HomeMy WebLinkAboutOrdinance 16185ORDINANCE NO. (Q S
ORDINANCE APPROVING THE RESOLUTION OF SERVICE
CENTER RELOCATION, INCORPORATED AUTHORIZING THE
ISSUANCE OF BONDS BY THE SERVICE CENTER RELOCATION,
INCORPORATED AND THE EXECUTION OF A LEASE WITH AN
OPTION TO PURCHASE AGREEMENT THE EXECUTION OF A
BOND PURCHASE AGREEMENT RELATING TO THE SALE OF
THE BONDS, AND APPROPRIATING AVAILABLE FUNIDS FOR
THE PURPOSE OF FUNDING LEASE PAYMENTS DURING THE
2004-2005 FISCAL YEAR.
WHEREAS, Sernce center Relocation, Incorporated (the `Corporation ') was created under
the auspices of the City of Fort Worth, Texas (the `City); and
WHEREAS, the Corporation by resolution to be adopted October 26, 2004 will authorize the
issuance of the hereinafter described bonds for the purposed described in said resolution, and
WHEREAS, it is deemed necessary and advisable that this Ordinance be adopted.
THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT
WORTH THAT
Sectionl The resolution (the `Resolution') adopted by the Corporation, m substantially the
form and substance as attached to this Ordinance and made a part hereof for all purposes, is hereby
approved, and tax increment contract revenue bond sin the principal amount not to exceed
$25,000,000 (the `Bonds"), may be issued for the purpose of providing all or a portion of the cost of
the project as specified m the Resolution (the `Project"); and said Resolution, Bonds and Project are
hereby approved.
Section 2. The `Lease with an Option to Purchase Agreement" between the City and the
Corporation, in substantially the form and substance as attached to this Resolution and made a part
hereof for all purposes (the `Lease"), is hereby approved and the Interim City Manager and the City
Secretary are hereby authorized to execute, attest, seal and deliver the Lease on behalf of the City
Section 3 The `Bond Purchase Agreement" by and among the City The Corporation, and
the underwriters named therein, in substantially the form and substance as attached to this Ordinance
and made a part hereof for all purposes (the `Purchase Agreement"), is hereby approved and the
Interim City Manager and the City Secretary are hereby authorized to execute, attest, seal and deliver
the Purchase Agreement on behalf of the City
Section 4 There is hereby appropriated for the General Fund of the City moneys sufficient to
enable the City to make Lease Payments under the terms of the Lease for the period ending
September 30, 2005
Section 5 This Ordinance shall be effective immediately upon its adoption by the City
Council.
APPR D AS TO FORM AND LEGALITY
G~GCr~~G~~/
City Attorney
Adopted. ['~ (' ~,y ~ ~T ~
SERVICE CENTER RELOCATION INCORPORATED
RESOLUTION
OF THE BOARD
WHEREAS, the Crty of Fort Worth ("City") has an existing Service Center
located on Harley Avenue;
WHEREAS, the City wishes to relocate the Service Center to a more desirable
location with the Crty
WHEREAS, the City authorized the formation of Service Center Relocation,
Incorporated, a Local Government Corporation ("Corporation') for the construction and
subsequent lease to the City of the new Service Center
NOW THEREFORE, BE IT RESOLVED that the Corporation is hereby
authorizes the issuance of Service Center Relocation, Incorporated Lease Revenue
Bonds, Series 2004 (Service Center Project), in an Aggregate Principal Amount not to
Exceed $25 Million.
FURTHER RESOLVED that the Corporation hereby approves the Indenture of
Trust and other contract documents related thereto and other contract documents relating
to the bonds and other provisions related thereto
BE IT FURTHER RESOLVED that the Secretary or any Assistant Secretary of
the Corporation is herby authorized and directed to certify the adoption of this
Resolution.
Adopted this 26th day of October 2004
By
Wendy Davis, President
LEASE WITH AN OPTION TO PURCHASE AGREEMENT
Between the
CITY OF FORT WORTH, TEXAS
as Lessee
and the
SERVICE CENTER RELOCATION INCORPORATED
as Lessor
Dated as of
October 1 2004
Table of Contents
Page No.
ARTICLE I. DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1 O1 Defuutions. 1
SECTION 1 02. General Rules of Construction. 4
SECTION 1 03 Preamble 5
ARTICLE II. GENERAL REPRESENTATIONS COVENANTS AND WARRANTIES
SECTION 2.01 General Representations, Covenants, and Warranties of Lessee. 5
SECTION 2 02. General Representations, Covenants, and Warrantees of Lessor 5
SECTION 2.03 General Assurances ~ 6
ARTICLE III. LEASE
ARTICLE IV THE PROJECT
SECTION 4 O1 Desi~ri, Construction, Acquisition, or Installation of Protect. 7
SECTION 4 02 Access to Project. 8
SECTION 4..03 Maintenance of Protect by Lessee. 8
SECTION 4 04 Use of the Project. g
SECTION 4 OS Lessee's Ne:zb>?ence; Liability Insurance. 8
SECTION 4 06 Property Insurance. 9
SECTION 4 07 Worker's Compensation Insurance. 9
SECTION 4 08 Requirements for Insurance Policies 10
SECTION 4 09 Utility Charges. 11
SECTION 4 10 Taxes. 11
SECTION 4 11 Modification of Protect by Lessee. 11
SECTION 4 12. Liens. 12
SECTION 4 13 Damage, Destruction. and Condemnation. 12
SECTION 4 14 Cooperation of Lessee. 14
SECTION 4 15 Installation of Lessee's Equipment. 14
SECTION 4 16 Assignment of Warranties. 15
SECTION 4 17 Insurance Required of Contractors. 15
SECTION 4 18 Wire Transfer Procedures. 15
ARTICLE V TERM OF LEASE 15
SECTION 5 O 1 Term of Lease 15
ARTICLE VI. PROJECT COSTS AND LEASE PAYMENTS 16
SECTION 6 O1 Protect Costs. Issuance Costs, Payment of Costs 16
'SECTION 6 02. Lease Payments. 16
SECTION 6 03 Current Expenses 17
SECTION 6 04 Lessee's Obligation. 17
ARTICLE VII. OPTION TO PURCHASE 17
SECTION 7 01 When Available. 17
SECTION 7 02 Exercise of Option. 17
SECTION 7 03 Release of Lessor's Interest. 1 g
ARTICLE VIII. ASSIGNMENT SUBORDINATION SUBLEASING,
MORTGAGING, AND SELLING 1 g
SECTION 8 O1 Assi~,nment by Lessor lg
SECTION 8 02. Assi~mnent by Lessee. 1 g
SECTION 8 03 Restriction on Mortgage or Sale of Protect by Lessee. 19
ARTICLE IX. THE BONDS 19
SECTION 9 O 1 Issuance and Sale of the Bonds. 19
SECTION 9 02. Cooperation.bv Lessee 19
SECTION 9 03 Maintenance of Tax Exempt Status of the Bonds 19
SECTION 9 04 Contmumg Disclosure Undertalang 21
ARTICLE X. REMEDIES 23
SECTION 10 O 1 Remedies on Event of Default of Lessee. 23
SECTION 10 02. Notices of Appropnation or Nonappropnation Tennmation on
Event of Nonappropnation 24
SECTION 10 03 Remedies on Event of Default of Lessor 24
SECTION 10 04 Lessor's Lien 25
SECTION 10 OS Delav; Notice 25
SECTION 10 06 No Remedy Exclusive. 25
SECTION 10 07 No Additional Waiver Implied by One Waiver 25
ARTICLE XI. TITLE 25
ARTICLE XII. HAZARDOUS MATERIALS 25
SECTION 12.01 Restrictions Reeardme Hazardous Substances 25
SECTION 12.02. Compliance with Hazardous Substance Laws 26
SECTION 12.03 Trustee`s Right to Conduct Assessments 26
SECTION 12.04 Remedial Action 26
SECTION 12.05 Discovery of Hazardous Substances 27
SECTION 12.06. Lessee's Limited Rieht to Mamtam Hazazdous Materials 27
ARTICLE XIII. MISCELLANEOUS PROVISIONS 27
SECTION 13 O1 Notices. 27
SECTION 13 02 Bmdm Effect. 28
SECTION 13 03 Severability 28
SECTION 13 04 Amendments. Chances, and Modifications. 28
SECTION 13 OS Approval and Registration 28
SECTION 13 06 Execution m Counterparts. 28
.~
SECTION 13 07 Applicable Law
SECTION 13 08 Complete Agreement.
SECTION 13 09 Survival of Representations and Warranties
SECTION 13 10 Time of Essence.
SECTION 13 11 References to Lessor
SECTION 13 12. Secuntv Interest.
Execution Page and Aclrnowledgment Pages
EXHIBIT A LEGAL DESCRIPTION
EXHIBIT B FORM OF FINAL ACCEPTANCE CERTIFICATE
EXHIBIT C LIST OF PERMITTED ENCUMBRANCES
EXHIBIT D-1 INITIAL LEASE PAYMENT SCHEDULE
EXHIBIT D-2 PURCHASE OPTION PRICE
EXHIBIT E TYPES AND AMOUNTS OF REQUIRED INSURANCE
EXHIBIT F FORM OF CERTIFICATE OF APPROPRIATION
EXHIBIT G LIABILITY INSURANCE COVERAGE REQUIREMENTS
EXHIBIT H ENVIRONMENTAL ASSESSMENTS AND RELATED MATERIALS
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THIS LEASE WITH AN OPTION TO PURCHASE AGREEMENT (the 'Lease'), dated as of
October 1 2004 by and between the CITY OF FORT WORTH, TEXAS a home-rule municipality and a
political subdivision of the State of Texas and pemutted assigns (the 'Lessee or the City"), and
SERVICE CENTER RELOCATION INCORPORATED a nonprofit corporation duly organized under
the laws of the State of Texas, together with its successors and assigns (the 'Lessor" or the
'Corporation').
WITNESSETH.
WHEREAS the Lessee is authorized by the laws of the State of Texas, including its home-rule
city charter to enter into contracts for the use or purchase or other acgwsition of real property or
unprovements to real property and for the use and acquisition of personal property•
WHEREAS the Lessor has been organized pursuant to Subchapter D Chapter 431 Texas
Transportation Code, as amended ("the Act") by the City Council of the City•
WHEREAS on October 26, 2004 .the Board of Directors of the Lessor adopted a resolution
authorizing the issuance of Service Center Relocation, Incorporated Lease Revenue Bonds, Series 2004
(Service Center Project), in an Aggregate Principal Amount Not to Exceed $25 Million, Approving an
Indenture of Trust and Other Contract Documents Relating to the Bonds, and Containing Other
Provisions Related Thereto (such resolution referred to herein as the 'Senes 2004 Bond Resolution')•
WHEREAS the Lessor is entering into an 'Indenture of Trust" dated as of October 1 2004 with
Wells Fargo Bank, National Association (the 'Trust Indenture'),
WHEREAS the Lessee and the Lessor are willing to enter into this Lease to facilitate the
acquisition and construction of the Project;
NOW THEREFORE, in the Iomt and mutual exercise of their powers, and in consideration of the
mutual covenants herein contained, the Corporation, as Lessor hereby leases the Project to the Crty and
the City as the Lessee, hereby leases the Project from the Lessor upon the terms and conditions set forth
in this Lease and the parties hereto agree as follows.
ARTICLE I. DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1 Oi Definitions. Unless the context otherwise requues, the terms defined in this
Section 1 O1 shall, for all purposes of this Lease, have the meanings herein specified. Capitalized terms
used herein without being defined herein shall, for the purposes of this Lease, have the meanings given
them in the Trust Indenture unless the context requires otherwise
Appropriate or Appropriated The adoption by the City Council of the City of a budget or
amendments to the budget for a Fiscal Year which includes the Lease Payments, other payments required,
if any to be made by the City under the Lease, and any other payments elected to be made by the City
under the Lease, if any during the respective Fiscal Year
Closing Date The date of initial delivery of and payment for the Bonds.
Code The Internal Revenue Code of 1986 as amended, including. applicable regulations
published rulings and court decisions thereunder
Completion Date The date upon which the Project is complete, as evidenced by the Lessee's
execution and delivery to the Lessor and the Trustee of a Final Acceptance Certificate.
Contract Documents As defined in the Development Agreement.
Developer Concho Development I, LP
Development Agreement The Development Agreement between the Corporation and Concho
Development I, LP dated as of 2004 and any duly authorized and executed amendment
thereto.
Event ofDefault The occurrence of any of the following events
(a) failure by the Lessee to make a Lease Payment (other than by virtue of an Event of
Nonappropnation) within ten calendar days after the due date thereof;
(b) failure by the Lessor to construct or cause to be constructed the Project in accordance with the
terms and conditions hereof;
(c) failure by the Lessee or the Lessor to observe and perform any covenant, condition, or
agreement, on its part to be observed or performed by it hereunder other than as referred tom (a) or (b)
above, and such failure is not cured within 30 calendar days after written notice thereof is provided to the
party m default by the other party hereto or the Trustee, specifying the nature of such default and
requesting that it be remedied unless (i) the Trustee shall agree in writing to an extension of such period
or (ii) if the failure is such that rt cari be corrected, but not within such period, and corrective action is
instituted by the defaulting party within the applicable period and such failure is corrected with due
diligence until satisfied after receipt by the defaulting party of such wntten notice from the Trustee,
(d) any material statement, representation, or warranty made by the Lessee in this Lease or in any
writing ever delivered by the Lessee pursuant to or in connection with this Lease is false, misleading, or
erroneous in any material respect;
(e) the filing by the Lessee of a voluntary petition in bankruptcy or failure by the Lessee
promptly to lift any execution, garnishment, or attachment of such consequence as would impair the
ability of the Lessee to carry on its operations at the Project, or adjudication of the Lessee as a bankrupt,
or assignment by the Lessee for the benefit of creditors, or the entry by the Lessee into an agreement of
composition with creditors, or the approval by a court of competent jurisdiction of a petition applicable to
the Lessee in any proceedings instituted under the provisions of the Federal Bankruptcy Code, as
amended, or under any sunilar federal or State laws which may hereafter be enacted,
(f) any event which shall occur or any condition which shall exist the effect of which is to cause a
hen (except Permitted Encumbrances and the Financing Documents) to be placed on the Project or the
Lessee's interest in the Project, and not released within 60 days, or
(g) a final judgment against the Lessee for an amount in excess of $100 000 shall be outstanding
for any period of 60 days or more from the date of its entry and shall not have been discharged in full or
stayed pending appeal, and a lien is placed on the Project or Lessee's interest in the Project.
Lessee shall- provide written notification to Lessor and Trustee promptly upon the occurrence of
any Event of Default identified in subsection (e), (f) or (g) of this defaution of 'Event of Default.
Event of Nonappropriation The failure of the Lessee to Appropriate in the budget adopted pnor
to the commencement of any Fiscal Yeaz sufficient funds to pay the Lease Payments or any other
amounts due hereunder for such Fiscal Yeaz or the reduction of any appropriation to an amount
insufficient to permit the Lessee to pay the Lease Payments or any other amounts due hereunder
Final Acceptance Certificate A certificate, in the form attached hereto as Exhibit 'B executed
by the Lessee.
Financing Documents Collectively this Lease, the Trust Indenture and the Bond Resolution.
Fiscal Year Each 12 month fiscal penod of Lessee commencing on October 1 and ending on
September 30 of the following year or such other annual accounting penod as the Lessee may hereafter
adopt.
Guaranteed Maximum Price of the Project The amount designated as the Guazanteed
Maximum Price m the Development Agreement.
Hazardous Substances This term shall be defined as set forth in Section 12.01 hereof.
Hazardous Substance Laws This .term shall be defined as set forth in Section 12.01 hereof.
Land The real property located in the City described m Exhibit A of this Lease.
Lease Payment An amount of money which, when added to the amount then on deposit in the
Payment Account, will equal (i) the amount of interest to become due on the Bonds on .the next Interest
Payment Date, (ii) the amount of principal to become due on the Bonds, whether by maturity or by
mandatory sinking fund redemption, on the next Principal Payment Date, and (iii) the amount of any
interest on overdue principal and interest required to be paid pursuant to the Trust Indenture and the Bond
Resolution. Attached as Exhibit D-1 hereto is an initial schedule of Lease Payments.
Lease Payment Date Initially February 25 2005 and each August 25 and February 25
thereafter for so long as this Lease is in effect.
Lessee Representative The City Manager any Assistant City Manager or any other officer or
employee of Lessee who is designated m wasting by resolution of the City Council of the City as a Lessee
Representative for the purposes of this Lease.
Lessor or Corporation Service Center Relocation, Incorporated, and its successors and assigns.
Lessor Representative Any director or officer of Lessor who is designated in writing by
resolution of the Corporations Board of Directors as a Lessor Representative for the purposes of this
Lease.
Net Proceeds Any insurance proceeds or condemnation award paid to the Lessor the Lessee, or
the Trustee with respect to the Project remaining after payment of all reasonable expenses incurred in the
collection thereof.
Permitted Encumbrances The matters described on Exhibit C attached hereto
Plans and Speci, jScations Architectural and engineering drawuigs and specifications prepared by
the Developer and approved by the Lessee describing the Project and any similarly approved changes
thereto.
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Project The Land, together with the consolidated shop, admimstration and equipment services
building and all improvements related thereto to be constructed thereori pursuant to this Lease and also
including any and all easements and all rights of ingress and egress to and from ad~oming property
(whether such rights now exist or subsequently anse) and all items of personal property whether now
owned or hereafter acquired with amounts on deposit in the Project Fund for and on behalf of and for the
use of the Lessee, including but not luruted to any and all furniture, fixtures, machinery and equipment
and any and all other items of personal property
Project Costs All costs of acquiring, constructing, reconstructing, unproving and expanding the
Project, including the cost of acquiring the land, the cost of machinery and equipment, interest during
construction and for up to one year after completion of construction, whether or not capitalized, and other
costs and expenses incident to or necessary for acquriing, constructing, reconstructing, unproving or
expanding the Project or placing the Project in operation.
Purchase Option Date (i) on any Bond redemption date and (ii) in the event of damage,
destruction, or condemnation of the Project, a date prior thereto established pursuant to Sections
4 13(a)(iii) or 4 13(b)(iii) of this Lease.
Purchase Option Price For each Purchase Option Date prior to , 202_, an amount
which will be sufficient to pay the principal of all Bonds then Outstanding, the redemption premium, if
any and accrued interest thereon to the date fixed for redemption in accordance with the applicable Bond
Resolution, together with any other amounts then due or past due hereunder including the fees and
expenses of the Trustee, less the funds held by the Trustee in any account of the Trust Fund (other than
the Rebate Account) as of the redemption date of the Bonds and on , 202_, One Dollar ($1 00),
provided that all amounts due and payable hereunder have been paid. A schedule showing the Purchase
Option Price, based on the original principal amount of the Bonds, is attached hereto as Exhibit D-2.
Regulations Any proposed, temporary or final income tax regulations issued pursuant to
Sections 103 and 141 through 150 of the Code, which aze applicable to the Bonds. Any reference to any
specific Regulation shall also mean, as appropriate, any proposed, temporary or final income tax
regulation designed to supplement, amend, or replace the specific Regulation referenced.
State The State of Texas.
Term The term of the Lease as detennined pursuant to Article V hereof.
Trust Indenture The 'Indenture .of Trust" between the Corporation and the Trustee, dated as of
October 1 2004 and any duly authorized and executed amendment thereto
Trustee Wells Fargo Bank, National Association, its successors and perrrutted assigns.
Trustee Representative Any officer of Trustee who is designated in writing as a Trustee
Representative for the purposes of the Trust Indenture and this Lease.
SECTION 1 02 General Rules of Construction. (a) When m this Lease the context requires, (i) a
reference to the singular number includes the plural and vice versa and (ii) a word .denoting gender
includes the masculine, feminine, and neuter
(b) The table of contents and the titles given to any article or section of this Lease aze for
convemence only and aze not intended to modify the article or section.
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(c) References to any constitutional, statutory or regulatory provision means such provision as it
exists as of the date of this Lease and any future amendments to such provision or successor provisions
thereof.
SECTION 1 03 Preamble. The statements and findings in the preamble of this .Lease are hereby
adopted and made a part of this Lease.
ARTICLE II. GENERAL REPRESENTATIONS COVENANTS, AND WARRANTIES
SECTION 2.01 General Representations, Covenants and Warranties of Lessee. The Lessee
represents, covenants, and warrants as follows
(a) the Lessee is a duly formed and validly existing home-rule mumcipality and political
subdivision governed by the laws of the State;
(b) the Lessee has full power and authority to execute this Lease and to perform its obligations
hereunder
(c) the governing body of the Lessee has duly authorized the execution of this Lease, and the
performance of its obligations hereunder
(d) the execution of this Lease -and the performance of its obligations hereunder and compliance
with the terms hereof by the Lessee will not conflict with, or constitute a default under any law
(including admimstrative rule), judgment, decree, order permit, license, agreement, mortgage, lease, or
other instrument to which the Lessee is subject or by which the Lessee or any of its property is bound,
(e) the Lessee presently expects to have sufficient funds available to satisfy its obligations under
this Lease and the Lessee will use its best efforts to manage its affairs in such a way as to maxinuze the
amount of funds available to the Lessee; provided, however the Lessee has no obligation to appropriate,
regazdless of the amount of lawfully available funds in its possession in any Fiscal Yeaz•
(f) this Lease is. the legal, valid, and binding obligation of the Lessee, enforceable in accordance
with its terms,
(g) the Lessee will use the Project during the Term for the public purposes of the Lessee and in
accordance with the provisions and lnnitations set forth iii Section 4 04 hereof;
(h) the Lessee agrees to keep the Project free and clear of all liens, encumbrances, and security
interests (other than Permitted Encumbrances) and
(i) except for approval of the Attorney General of Texas, which will be obtained prior to Closing,
no further approval, consent, or withholding of objections is required from any governmental authority
with respect to this Lease.
SECTION 2 02. General Representations Covenants and Warranties of Lessor The Lessor
represents, covenants, and warrants as follows
(a) the Lessor is a validly existing nonprofit corporation authorized to operate under the Act;
(b) the Lessor has the full power and authority to execute the Financing Documents and perform
its obligations thereunder
(c) the Lessor has the full power and authonty to issue, sell, and deliver the Bonds and to use the
proceeds thereof for the Project, and agrees to take all steps legally required and incidental for the valid,
lawful, and enforceable authorization, issuance, sale, and delivery thereof;
(d) the Corporations Board of Directors has duly authonzed the execution of the Financing
Documents and the performance of the Lessor's obligations thereunder
(e) the execution of the Financing Documents and the performance of its obligations thereunder
and compliance with the terms thereof by the Lessor will not conflict with, or constitute a default under
any law (including admuustrative rule), judgment, decree, order penmt, license, agreement, mortgage,
lease, or other instnunent to which the Lessor is subject or by which the Lessor or any of its property is
bound,
(f) the Lessor is not in violation. of any law which violation could adversely affect the
performance of its obligations under the Financing Documents,
(g) upon termination of this Lease pursuant to Section 5 O1 subsection (a), (d) or (e) hereof, the
Lessor will deliver to Lessee all documents which are or may be necessary to vest all of the Lessor's nght;
title, and interest in and to the Project in the Lessee and will release all liens and encumbrances in favor of
the Lessor created under this Lease with respect to the Project as provided in Article VII,
(h) the Lessor agrees to keep the Project free and clear of all hens, encumbrances, and security
interests (other than the Permitted Encumbrances and the liens created or evidenced by the Financing
Documents)
(i) on the Closing Date, the Lessor will hold fee simple title to the Land, subject to Penrutted
Encumbrances and the liens created or evidenced by the Financing Documents, and, will, for the period of
time commencing on the date of the execution of this Lease and expiring on the termination of this Lease,
warrant and forever defend all and singular Lessee's leasehold interest in the Land unto the Lessee, its
successors, and permitted assigns against every person whomsoever lawfully claiming the same, or any
part thereof;
(j) subject to compliance by the Lessee with the provisions of this Lease, the Lessor hereby
covenants to provide the Lessee dunng the Tenn with the quiet use and enjoyment of the Land, subject to
the Permitted Encumbrances and the teens of the Financing Documents, and the Lessee shall peaceably
and quietly have and hold and enjoy such property without suit, trouble, or hindrance from the Lessor
(k) except for the approval of the Attorney General of Texas, no further approval, consent, or
withholding of objections is required from any govenunental authonty with respect to the execution,
delivery and performance of this Lease;
(1) the Lessor has complied with and will comply with all open meeting laws and all other state
and federal laws applicable to the Lessor relating to the approval and construction of the Project and the
payment of Project Costs
(m) this Lease is the legal, valid, and binding obligation of Lessor enforceable in accordance
with its terms.
SECTION 2.03 General Assurances. The Lessor and the Lessee, subject to Section 2.01(e) each
agrees .that (to the extent permitted by law) it will take or cause to be taken all actions necessary to
preserve its existence in full force and effect and to cant' out the teens of this Lease.
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ARTICLE III. LEASE
In consideration of the mutual covenants and agreements set forth in this Lease, and other good
and valuable consideration, the Lessor denuses and leases the Protect to the Lessee, and the Lessee leases
the Protect from the Lessor all in accordance with the teens and provisions of tlus Lease. This Lease
shall be subtect and subordinate to the Trust Indenture and any other Financing Document; provided,
however if a Lessee Event of Default or an Event of Nonappropnation has not occurred, the Lessee may
not be depnved of its nghts to the Protect as provided in the Lease, including the nght of possession and
use of the Protect and its right to exercise its option to purchase.
ARTICLE IV THE PROJECT
SECTION 4 O1 Design, Construction. Acquisition, or Installation of Protect. (a)(i) The Lessor
hereby agrees to
(A) acquue and construct the Protect in accordance with the terms and conditions hereof;
(B) cause the Protect to be designed, constructed, acquued, or installed m compliance with all
State and federal laws applicable to the design, construction, demolition, acquisition, or
installation of the Protect; and
(C) to obtain all approvals necessary from the appropriate governmental authonties, including the
Lessee, and, to the extent required by local ordinance, plat the Land as a separate tract.
(ii) On or. before the Closing Date, the Lessor will enter into the Development Agreement with
respect to the acquisition, construction and development of the Protect.
(iii) The Lessor shall use its best efforts to comply with all reasonable requests of the Lessee in
connection with the design, construction, acgwsrtion, or installation of the Protect, including without
lurutation, review of the Contract Documents governing the construction and development of the Protect.
(iv) The Lessee agrees to pay from lawfully available funds any amount of the Protect Costs in
excess of the amount on deposit in the Protect Fund which is set aside to pay Protect Costs.
(v) Subtect to the limitation of Section 9 03(a), investment earnings of funds on deposit in the
Protect Fund shall remain in the Protect Fund to pay Protect Costs.
(b) The Lessee shall exercise due care m the use, operation, and maintenance of the Protect and
shall not use, operate, or maintain the Protect unproperly carelessly in violation of any State or federal
law or for a purpose, or in a manner contrary to that contemplated by this Lease. Additionally the
Lessee shall not unreasonably obstruct or lender the Lessor m carrying out its duties under and pursuant
to this Lease. Lessee shall obtain all permits and licenses necessary for the operation, possession, and use
of the Protect. Lessee shall comply with all State and federal laws applicable to the use, possession, and
operation of the Protect and, if compliance with any such State and federal law requues changes or
additions to be made to the Protect, such changes or additions shall be made in accordance with Section
4 11 hereof.
(c) On the Closing Date, the Lessor shall assign to the Trustee all of its nght, title, and interest,
but none .of its responsibilities, obligations, or liabilities under the Development Agreement, including but
not limited to the nght to exercise .such rights and remedies conferred on the Lessor as may be necessary
to protect the interest of the Bondholders.
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(d) The Lessee shall not charge the Lessor any City of Fort Worth development fees or water
fees, except unpact fees dunng the construction of the Project.
SECTION 4 02. Access to Protect. (a) Dunng construction of the Project, the Lessor shall
provide access to the Project site to the Lessee s mspectors perfonnmg then normal duties associated with
construction sites withm the City In addition; the Lessee shall identify individuals who will be permitted
into the Project area to make observations for the sole purpose of determining if the Project is bemg
constructed in accordance with the Contract Documents These mdividuals shall have no authonty to
direct any subcontractors m the performance of the construction of the Project but shall make all
communication with the Developer
(b) After construction of the Project has been completed and the Lessee has delivered its Final
Acceptance Certificate, the Lessor and the Lessee each agrees that the Lessor any Lessor Representative,
the Lessee, any Lessee Representative, the Trustee, and any Trustee Representative shall have the nght at
all reasonable times to enter upon and to examme and inspect the Project. The Lessee and the Lessor
each further agrees that the Lessor and any Lessor Representative shall have such nghts of access to the
Project as may be reasonably necessary to cause the proper .maintenance of the Project m the event of
failure by the Lessee to perform its obligations hereunder or to carry out the Lessor's obligations and
exercise the Lessor's nghts under Article X hereof, or to determine whether the Lessee is m compliance
with this Lease.
SECTION 4 03 Maintenance of Project by Lessee. (a) After construction of the Project has been
completed and the Lessee has delivered its Final Acceptance Certificate, dunng the Tenn, the Lessee shall
mamtain, preserve, and keep the Project m good repair working order and condition, and from tune to
time, make or cause to be made all repairs, replacements, and mzprovements necessary to keep the Project
in such condition. The Lessee agrees to pay the expenses of such maintenance from Appropnated
lawfully available funds. The Lessor shall have no responsibility for such mamtenance, or for any such
repairs, replacements, or improvements.
(b) Subject to the provisions of Section 9 03 of this Lease, the Lessee shall have the nght to
contract with a third party to .mamtam, repair replace and improve the Project, as necessary to keep the
Project in good repair working order and condition, to the extent that such contract does not adversely
affect the exclusion of mterest on the Bonds for federal income tax purposes, provided that the Lessor
Lessee and Trustee may rely on an opmion of Bond Counsel that the exclusion of mterest on the Bonds
for federal mcome tax purposes will not be adversely affected by the contract with such third party and
further provided, that Lessee shall not be relieved of its obligation to mamtam the Project by entering into
a contract with a third party to perform such dunes.
SECTION 4 04 Use of the. Protect. The Lessee will use the Project for any lawful purpose
consistent with the normal intended use of the Protect so long as such use does not adversely affect the
treatment of the Bonds as obligations described m section 103 of the Code, the mterest on which is
excludable from gross income" for purposes of federal mcome taxation.
SECTION 4 OS LESSEE'S NEGLIGENCE. LIABILITY INSURANCE. (a) TO THE EXTENT
PERMITTED BY THE LAWS OF THE STATE, THE LESSEE ASSUMES ALL RISKS AND
LIABILITIES WHETHER OR NOT COVERED BY INSURANCE, FOR LOSS OR DAMAGES TO
THE PROJECT AND FOR INJURY TO OR DEATH OF ANY PERSON OR DAMAGES TO .ANY
PROPERTY WHETHER SUCH INJURY OR DEATH BE WITH RESPECT TO AGENTS OR
EMPLOYEES OF THE LESSEE OR OF THIRD PARTIES AND WHETHER SUCH PROPERTY
DAMAGE BE TO THE LESSEE'S PROPERTY OR THE PROPERTY OF OTHERS IF SUCH
INJURY DEATH, LOSS OR DAMAGE BE PROXIMATELY CAUSED BY THE NEGLIGENT
CONDUCT OF THE LESSEE, ITS OFFICERS EMPLOYEES AGENTS GUESTS OR INVITEES
8
TO THE EXTENT PERMITTED BY THE LAWS OF THE STATE OF TEXAS, THE LESSEE
HEREBY ASSUMES RESPONSIBILITY FOR AND AGREES TO REIMBURSE THE LESSOR,
FROM AND TO THE EXTENT OF LAWFULLY AVAILABLE FUNDS IN EXCESS OF THE
AMOUNTS REQUIRED TO BE PAID BY THIS LEASE AND THE FUNDS REQUIRED TO BE
HELD BY THE TRUSTEE PURSUANT TO THE TRUST AGREEMENT FOR ALL LIABILITIES,
OBLIGATIONS LOSSES DAMAGES PENALTIES CLAIMS ACTIONS COSTS AND
EXPENSES OF WHATSOEVER KIND AND NATURE, IMPOSED ON INCURRED BY OR
ASSERTED AGAINST THE LESSOR THAT IN ANY WAY RELATE TO OR ARISE OUT OF A
CLAIM, SUIT OR PROCEEDING BASED IN WHOLE OR IN PART UPON THE CONDUCT OF
THE LESSEE, ITS OFFICERS EMPLOYEES AGENTS, GUESTS OR INVITEES
(b) Dunng the Term, the Lessee shall procure from Appropnated lawfully available funds, and
maintain continuously in effect, or cause to be procured and maintained continuously in effect, with
respect to the Project, a policy of insurance or coverage of comprehensive general {public) liability on an
occurrence based :form with a combined single lumt, or provide a self funded program, as set out in
Exhibit E, against liability for m~uries to or death of any person or damage to or loss of property ansing
out of or in any way relating to the 'maintenance, use, or operation of the Project or any part thereof. The
Trustee and the Lessor shall be named as additional insureds. The insurance or coverage shall include
coverage for preuuses/operation, independent contractors, products/completed operations, personal and
bodily injury contractual liability and explosion, collapse, and underground property damage in the
amounts set out m Exhibit E. The insurance required under this subpazagraph may be provided through
an 'umbrella policy which provides coverage for any one occurrence in the minimum coverage amount
previously set forth.
SECTION 4 06 Property Insurance Dunng the Tenn, the Lessee shall procure from
Appropriated lawfully available funds, and maintain continuously in effect, or cause to be procured and
maintained continuously in effect, with respect to the Project, all-nsk and its equivalent property
insurance in a coverage amount not less than the greater of the replacement value of the Project or the
amount of the Purchase Option Pnce then applicable, subject only to the standard exceptions, limitations,
and exclusions customarily contained in such policies. The Lessee shall ensure that at all tunes the luruts
of coverage are sufficient to pay for the full replacement cost of the property at the tune of loss, without
deduction or depreciation. All policies of insurance or coverage requu-ed by this section shall be issued to
the Lessee as the fu-st named insured or such other term stipulating sumlaz meamng. Additionally all
polices shall be camed in the names of the Lessor and the Trustee, as thee- interests may appear and
shall name the Trustee as the loss payee. The Net Proceeds of insurance requued by this Section shall be:
deposited by the Lessor the Lessee or the Trustee to the Insurance and Condemnation Fund pursuant to
Section 4 06 of the Trust Indenture and shall be applied as provided in Section 4 13 hereof.
SECTION 4 07 Worker's Compensation Insurance. Dunng the Tenn, Lessee shall, from
Appropnated lawfully available funds, carry Worker's Compensation Insurance covering all employees of
the Lessee on, m, neaz or about the Project and, upon request, shall funush to the Lessor and the Trustee
certificates evidencing such coverage throughout the Term. In lieu of carrying Worker's Compensation
Insurance, the Lessee may to the extent pernutted by and in compliance with applicable State law
provide a program of self insurance for worker's compensation clauns and in such event shall fiumsh to
the Trustee evidence of the Lessee's compliance with such State law Any such coverage shall be as set
out m Exhibit E.
SECTION 4.08 Requirements for Insurance Policies.
All policies of insurance or coverage required to be obtained pursuant to Sections 4 OS 4 06, 4 07
and 4 17 may be carried under a sepazate policy or a rider or endorsement; shall be written by an
insurance company approved by the Lessor and shall be taken out and maintained with insurance
companies organized under the laws of one of the states of the United States and qualified and licensed to
write insurance or coverage in the State of the types and amounts required and have A.M. Best ratings of
at least A VII. If the rating is below A VII, written approval of the Lessor is required to take out
insurance with such company Additionally all such policies or coverage shall contain a provision that
the insurer shall not cancel or revise coverage thereunder without giving written notice to the Lessor the
Lessee, and the Trustee at least 45 calendar days before the cancellation or revision becomes effective. At
least 30 days before the expiration of any such policy the Lessee shall furnish to the Lessor and the
Trustee evidence that the policy has been renewed or replaced by another policy conforming to the
provisions of this Article N unless such insurance is no longer obtainable, in which event the Lessee
shall notify the Lessor and the Trustee of this fact. In addition, the following requirements shall apply
(i) The Lessor its officers, employees and volunteers shall be named as an additional insured, the
foregoing nothwithstanding, the additional insured requirement does. not apply to Workers s
Compensation policies.
(ii) Any such policies shall provide for waiver of rights of recovery (subrogation) in favor of the
Lessor
(iii) If insurance policies are not written for specified coverage lunits, an umbrella or excess
liability insurance for any differences is required, excess liability shall follow form of the prunary
coverage.
(iv) Unless otherwise stated, all required insurance shall be written on the occurrence basis If
coverage is underwritten on a claims-made basis, the retroactive date shall be coincident with or prior to
the date of the contractual agreement and the certificate of insurance shall state that the coverage is
claims-made and the retroactive date. The insurance coverage shall be maintained for the duration of the
contractual .agreement and for five (5) years following completion of the service provided under the
contractual agreement or for the warranty period, whichever is longer An .annual certificate of insurance
submitted to the Lessee shall evidence such insurance coverage.
(v) The deductible or self insured retention (SIR) affecting required insurance coverage shall be
acceptable to and approved in writing by the Lessor in regazds to asset value and stockholders equity In
lieu of traditional insurance, alternative coverage maintained through insurance pools or nsk retention
groups, must also be approved by the Lessor
(vi) The Lessor at its sole discretion, reserves the right to review the insurance requirements and
to make reasonable adjustments to insurance coverages and their lunits when deemed necessary and
prudent by the Lessor based upon changes in statutory law court decision or the claims history of the
industry The Lessor shall be required to provide prior notice of ninety days
(vii) The Lessor shall be entitled, upon request and without expense, to receive copies of policies
and endorsements thereto and may make any reasonable requests for deletion or revision or modifications
of particular policy terms, conditions, lnnitations, or exclusions except where policy provisions are
established by law or regulations buiding upon either of party or the underwriter on any such policies.
10
SECTION 4 09 Utility Chaz~es, Approvals
(a) During the Term, the Lessee shall pay from Appropriated lawfully available funds directly to
vendors and suppliers all deposits, chazges, fees, and costs incurred for all utility equipment and services
connected with the use and occupancy of the Project, including, but not luruted to, water sewer refuse
removal, electricity gas, and telephone; and the Lessee shall pay directly for ~anitonal services and
related supplies connected with the operations of the Project.
(b) The Lessee hereby represents and warrants that, either as of the date hereof or on or before
commencement of construction or with respect to water and samtary sewer services, on or before
completion of construction, of the Project, as the case may be, all utility services necessary for the
construction of the Project and the operation thereof for then intended purposes aze available at the
boundaries of the Land in public ways, including without lunitation, water supply all regmred storm
drainage facilities, sanitary sewer facilities, gas, electric, and telephone facilities, and all necessazy steps
have been taken by Lessee and any such govenunental authorities to assure complete construction and
installation of such utility services.
(c) The Lessee further represents and warrants that the Lessee has obtained or as and when
applicable following commencement of construction will obtain tunely all necessary approvals,
including, without limitation, all environmental approvals, from any and all governmental, administrative,
or judicial bodies having ~unsdiction over the Project or the Lessee requisite to the acgmsrtion,
construction, and, to the extent the same can be legally obtained prior to completion of construction of the
Project, operation of the Project.
SECTION 4 10 Taxes. (a) After delivery of the Final Acceptance Certificate, the Lessee shall
pay from Appropriated lawfully available funds any sales, property use, license, or other taxes respecting
the Project, unposed, assessed, levied, or becoming due and payable on or after the effective date of this
Lease, together with any penalties, fines, or interest thereon. Lessee shall have the right to seek and
pursue exemption from ad valorem or other taxation of all or any portion of the Project. Any tax
statement received by the Lessor for taxes payable by the Lessee shall be promptly forwarded by the
Lessor to the Lessee for payment. The Lessee may after notifying the Trustee in writing, at its own
expense, in good faith contest any such taxes or payments in lieu of taxes and permit the items so
contested to remain unpaid during the period of contest and any appeal therefrom, unless the Trustee shall
first notify the Lessee that, in the opinion of its counsel, by nonpayment of any such items, the hen or
security interests of the Trustee will be materially endangered or the Project or any part thereof will be
subject to loss or forfeiture, in which case such taxes, assessments, or payments in lieu thereof shall be
promptly paid.
(b) The Lessee shall provide to the Trustee annually within 3.0 days after the end of its Fiscal
Yeaz written certification that all such taxes have been paid or are being contested or evidence that the
Project is exempt from ad valorem taxation.
SECTION 4 11 Modification of Project by Lessee. During the Tenn, and after delivery of the
Final Acceptance Certificate to the Trustee, the Lessee shall have the right to remodel the Project or to
make additions, modifications, and uprovements thereto from Appropriated .lawfully available funds
All such .additions, modifications, and improvements shall thereafter comprise part of the Project and
shall be subject to the provisions of this Lease. Such additions,. modifications, and improvements must
not m any way damage the Project or cause. it to be used for purposes other than those authorized under
the provisions of State or federal law the Project, upon completion of any additions, modifications, and
uprovements made pursuant to this Section, .must be verified in writing by the Architect to be of a value
11
not less than the value of the Project immediately prior to the making of such additions, modifications,
and uprovements. Any property for which a substitution or replacement is made pursuant to this
Section, may be disposed of by the Lessee in such manner and on such terms as determined by the
Lessee.
SECTION 4 12. Liens. (a) After delivery of the Final Acceptance Certificate, the Lessee shall
not, directly or indirectly create, incur assume, or suffer to exist any mortgage, pledge, lien, charge,
encumbrance, or claun on or with respect to the Project or this Lease or the Lessee's interest herein, othei
than the respective nghts of the Lessor and the Lessee as provided in this Lease, the Financing
Documents, and Penmtted Encumbrances The. Lessee shall promptly take such action as may be
necessary to discharge or remove any such mortgage, pledge, lien, charge, encumbrance, or claun if the
same shall arise at any tune, and reunburse the Lessor from lawfully available funds for any expense
incurred by it in order to discharge or remove any such mortgage, pledge, lien, charge, encumbrance, or
claun.
(b) After delivery of the Final Acceptance Certificate, the Lessee will not permit any mechanic's,
matenalman's, or other lien to be established or remain against the Project for labor or materials furnished
m connection with any additions, modifications, improvements, repairs, renewals, or replacements made
by the Lessee pursuant to Sections 4 Ol 4 03 or 4 11 hereof. If any such lien is filed and the Lessee shall
first notify the Lessor of the Lessee's intention to do so the Lessee may m good faith contest any hen
filed or established against the Project and, m such event, may penmt the items so contested to remain
undischarged and unsatisfied during the period of such contest and any appeal therefrom unless the
Lessor shall notify the Lessee that, m the opuuon of Lessor's counsel, by nonpayment of any such hen the
interest of the Lessor m the Project will be adversely affected or materially endangered or the Project or
any part thereof will be subject to loss or forfeiture, in such event, the Lessee shall, from any lawfully
available funds, promptly pay and cause to be satisfied and discharged- all such unpaid hens or provide the
Lessor with full security against any such loss of forfeiture, in form satisfactory to the Lessor The Lessor
will cooperate fully with the Lessee in any such contest, upon request of the Lessee, if the Lessee agrees
to pay the Lessor's expenses.
SECTION 4 13 Damage, Destruction, and Condemnation. (a) If the Project or any portion
thereof is destroyed or damaged by fire or other casualty and.
(i) if the amount of Net Proceeds deposited into the Insurance and Condemnation Fund is
sufficient for the necessary repau and/or replacement of the Project and the Lessee has not
exercised its option to purchase pursuant to Section 7 02 hereof, the Lessor shall make all
necessary repairs and/or replacements by making requisitions through the Trustee from the
Insurance and- Condemnation Fund pursuant to Section 4 06 of the Trust Indenture;
(ii) if the amount of Net Proceeds deposited into the Insurance and Condemnation Fund is
insufficient for the necessary repair and/or replacement of the Project, the Lessee may within 45
days of the date of the initial deposit of the Net Proceeds, deposit into the Insurance and
Condemnation Fund, from Appropriated lawfully available funds, the amount needed for the
completion of all necessary repau and/or replacement of the Project and upon such deposit the
Lessor shall make all necessary repaus and/or replacements by making reqursitions through the
Trustee from the Insurance and Condemnation. Fund pursuant to Section 4 06 of the. Trust
Indenture
(iii) if the Project has been damaged to an extent which results in the Lessee's inability to use
50% or more of the Project for municipal purposes as certified in writing to the Corporation and
the Trustee by a licensed architect or registered professional engineer and if the amount of Net
12
Proceeds deposited into the Insurance and Condemnation Fund is insufficient for the necessary
repau and/or replacement of the Project, the Lessee may exercise its option to purchase .the
Project on the next Purchase Option Date for which it is possible to give notice of its intent to
purchase in accordance with the procedures set forth ui Section 7 02 hereof and, in such event,
any Net Proceeds on deposit in the Insurance and Condemnation Fund shall. be applied as a credit
toward the Purchase Option Price; or
(iv) if the amount on deposit in the Insurance and Condemnation Fund is insufficient for the
complete repair and/or replacement of the Project, and the Lessee does not, within 45 days of the
date of such deposit of Net Proceeds with the Trustee, deposit into the Insurance and
Condemnation Fund the amount needed to complete the repau and/or replacement of the Project
or exercise its option to purchase the Project in accordance with Section 7 02 hereof, the amount
on deposit in the Insurance and Condemnation Fund will be transferred into the Debt Service
Fund by the Trustee and used in accordance with Section 4 03 of the Trust Indenture, solely for
the purpose of redeeming Bonds prior to their maturity
Regazdless of the insufficiency of the Net Proceeds for either the repau and/or replacement of the Project
or for the exercise of the option to purchase, the Lessee shall remain obligated to continue to pay the
Lease Payments from Appropriated lawfully available funds.
(b) If title to or the temporary use of the Project or any part thereof, or the interest of Lessee,
Lessor or the Trustee in the Project or any part thereof, shall be taken under the exercise of the power of
eminent domain by any govenunental body or by any person, firm, or corporation acting under
governmental authority the Lessee shall have the rights and obligations specified in this Section with
respect to the Net Proceeds of any condemnation award. The Lessee, Lessor and Trustee shall promptly
deposit the Net Proceeds of any condemnation awazd with the Trustee for credit to the Insurance .and
Condemnation Fund and.
(i) if the Net Proceeds of any condemnation award aze sufficient to replace the Project or the
portion thereof taken and the Lessee has not exercised its option to purchase pursuant to Section
7 02 hereof, the Trustee shall disburse amounts from the Insurance and Condemnation Fund for
such replacement in accordance with Section 4 06 of the Trust Indenture,
(ii) if the Net Proceeds of any condemnation award are insufficient to replace the Project or the
portion thereof taken, the Lessee may within 45 days of the initial deposit of the Net Proceeds,
deposit with the Trustee, from Appropriated lawfully available funds, the amount which, when
added to the amount of the condemnation award, will total the full amount needed for the
replacement of the Project or the portion thereof taken and upon such deposit the Trustee shall
disburse amounts from the Insurance and Condemnation Fund for such replacement in
accordance with Section 4 06 of the Trust Indenture,
(iu) if the Lessee is unable to use 50% or more of the Project for municipal purposes, as certified
m writing to the Corporation and the Trustee by a licensed architect or registered professional
engineer as a result of such eminent domain proceeding or taking and if the Net Proceeds of any
condemnation award are insufficient to replace the Project or the portion thereof taken, the Lessee
may exercise rts option to purchase the Project on the next Bond Payment Date for which rt is
possible to give notice of its intent to purchase in accordance with the procedures set forth in
Section 7 -02 hereof and, m such event, any .Net Proceeds on deposit m the Insurance and
Condemnation Fund shall be applied as a credit towazd the Purchase Option Price; or
13
(iv) if the Net Proceeds are uisufficient to pay in full the cost of the replacement of all or any
portion of the Project, and the Lessee does not; within 45 days of such deposit of Net Proceeds
with the Trustee, exercise its option to purchase in accordance with Section 7 02 hereof or deposit
into the Insurance and Condemnation Fund an amount of Appropnated lawfully available funds
which together with the Net Proceeds so deposited with the Trustee will be sufficient to replace
the Project or the portion thereon taken, the amount on deposit in the Insurance and
Condemnation Fund will be transferred into the Debt Service Fund by the Trustee and used in
accordance with Section 4 03 of the Trust Indenture, solely for the purpose of redeeming Bonds
pnor to their maturity
Regardless of the insufficiency of the Net Proceeds for either the replacement of the Project or for the
exercise of the option to purchase, the Lessee shall remain obligated to continue to pay the Lease
Payments from Appropriated lawfully available funds.
(c) Notwithstanding anything to the contrary contained in subparagraph (b) above, or anywhere
else in this Lease, if title to or the temporary use of the Project or any part thereof, or the interest of the
Lessor or the Trustee in the Project or any part thereof, shall be taken under the exercise of the power of
eminent domain by the Lessee, the Lessor and the Lessee hereby expressly acknowledge and agree, to the
extent permitted by law and pursuant to the requirements of Section 21 012 of the Texas Property Code,
that the damages payable to the Lessor or the Trustee, as the case may be, pursuant to such exercise of the
power of eminent domain by the Lessee shall be an amount which will be sufficient on the date payment
is made by the Lessee to the Lessor the Trustee, or the clerk of the court of a court of competent
jurisdiction, together with amounts, if any on deposit m the Debt Service Fund and the Project Fund, to
pay an amount equal to the Purchase Option Price for the Project on the next Purchase Option Date. The
Lessee agrees that the provisions of this subparagraph (c) shall survive the termination of this Lease,
notwithstanding anything herein to the contrary
SECTION 4 14 Cooperation of Lessee. The Lessee shall cooperate fully with the Lessor m filing
any proof of loss with respect to any insurance policy described in Sections 4 OS 4 06 or 4 07 and in the
prosecution or defense of any prospective or pending condemnation proceeding with respect to the
Project or any part thereof and will,. to the extent it may lawfully do so, pennrt the Lessor to litigate in any
proceeding resulting therefrom in the name of and on behalf of the Lessee. In no event will the Lessee
voluntarily settle, or consent to the settlement of, any proceeding ansing out of any insurance claun or
any prospective or pending condemnation proceeding with respect to the Project or any part thereof
without the wntten consent of the Lessor and the Trustee. The Lessee shall file and pursue any clauns it
has under any insurance policies described m Sections 4 OS 4 06 4 07 and, if applicable, 4 17 hereof and
shall not voluntarily settle, or consent to the settlement of, any proceeding arising out of any such
insurance claun, without the Lessor's pnor written consent.
SECTION 4 15 Installation of Lessee's Equipment. The Lessee may at any tune, in its sole
discretion and with funds other than the amounts in the Project Fund, install items of movable funuture,
fixtures, machinery and equipment m or upon the Project, which items shall be identified by the Lessee
as property of Lessee not included m the Project. All such items so identified shall remain the sole
property of Lessee, in which the Lessor and Trustee shall have no interest, and may be modified or
removed by the Lessee at any time, provided that the Lessee shall repair and restore any and ahl damage to
the Project from the installation, modification or removal of such items Nothing in this Lease shall
prevent the Lessee from purchasing items of moveable furniture, machinery and equipment to be
installed pursuant to this Section under a conditional sale or lease with option to purchase contract, or
subject to a vendor's hen or security agreement as security for the unpaid portion of the purchase pace
thereof, provided that no such lien or security interest shall attach to any part of the Project; provided
further however that to the extent the Lessee's obligation under any such conditional sale or lease with
14
option to purchase contract is payable solely from Appropnated lawfully available funds, such obingatnon
shall be payable only from Appropnated lawfully available funds m excess of the amount required to be
paid annually under this Lease. Notwithstanding this Section or any other provision of this Lease to the
contrary all items of personal property including movable furniture, fixtures, machinery and equipment
which aze acquued wrath funds provided by the Project Fund estabinshed by the Trust Indenture, shall be
subject to the hens unposed by the Tnst Indenture, and shall be consndered a part of the Trust Estate.
SECTION 4 I6 Assngmnent of Warrantees. Subject to Sectnon 4 Ol(d) hereof, the Lessor hereby
assigns to the Lessee, for and during the Term, all of its interest in all warranties acid guarantees, express
or empleed, issued on or applecable to the Project, and the Lessor hereby authorizes the Lessee to obtain
the customary services furneshed in connecteon with such warrantees and guarantees.
SECTION 4 17 Insurance Reounred of Contractors. During the eruteal construction of the Project
the Lessor and thereafter dunng any mayor constructeon, renovateon or restorateon involving an aggregate
expendeture of more than $100 000 the Lessee shall cause all contractors to obtain the insurance coverage
set out en Exhibit G attached hereto and encorporated by reference herein for all purposes.
SECTION 4 18 Wire Transfer Procedures. If any payment es to be made by the Trustee to the
Lessee or any designee by were transfer the Lessee agrees to enter ento an agreement concerning were
transfer,enstructeons en a form to be proveded by the Trustee. Until the Lessee executes such an
agreement, the Trustee shall not be required to make any payment under the Trust Agreement to the
Lessee or any desegnee by wire transfer
ARTICLE V TERM OF LEASE
SECTION 5 O1 Term of Lease.
This Lease shall be and remaen in effect with respect to the Project for a Lease term (the 'Term')
commencing on the date hereof and continuing until terminated upon the occurrence of the first of the
following events
(a) the exercese by the Lessee of its opteon to purchase pursuant to Artecle VII of this Lease, and
the payment of all amounts due and oweng hereunder
(b) the end of the Fnscal Yeaz in whch an Event of Nonappropnateon occurs,
(c) the effective date of terminateon of thes Lease by Lessor or Trustee pursuant to the exercise of
the rights of the Lessor to terminate thes Lease upon the occurrence of an Event of Default pursuant to
Artecle X,
(d) the payment by Lessee of all Lease Payments and all other amounts requereci to be paid by
Lessee hereunder
(e) the defeasance of the Bonds pursuant to Section 6 6 of the Bond Resolution, or
(f) Mazch 1 2034
15
ARTICLE VI. PROJECT COSTS AND LEASE PAYMENTS
SECTION 6 O1 Protect Costs. Issuance Costs. Payment of Costs (a) The Lessor and the Lessee
agree that.
(i) the amount of Project Costs to be paid under the Development Agreement shall not exceed the
Guaranteed Maximum Pnce of the Project set forth in the Development Agreement, unless
increased as a result of change orders to the plans and specifications as penmtted by the
Development Agreement;
(ii) Costs of Issuance payable from the Project Fund shall not exceed $ ,provided that
any such amount not disbursed within three months of the date of this Lease shall remain in the
Project Fund and maybe used for the payment of all other Project Costs,
(iii) all Project Costs, including Project Costs paid under the Development Agreement, Issuance
Costs and the acquisition costs of the Land, to be paid from the Project Fund shall not exceed
$ ,
(iv) the sum of $ from the proceeds of the Bonds shall be deposited into the Project
Fund in order to ensure that sufficient funds will be available when required to pay all the Project
Costs (which includes Issuance Costs and the acquisition costs of the Land) on the Closing Date;
(v) the proceeds of the Bonds, including accrued interest on the Bonds (if any), shall be
deposited in the funds and accounts maintained under the Trust Indenture and in the amounts
directed by written instruction of the Lessor to the Trustee on the Closing Date, and the use and.
disbursement of such funds shall be governed by the Trust Indenture.
(b) Prior to disbursements from the Project Fund under the Trust Indenture by the Trustee for
Issuance Costs, the Lessor shall furnish the Trustee with a Requisition Requesting Disbursement of
Issuance Costs in the form prescribed in Exhibit A to the Trust Indenture.
(c) On .completion of the Project, and as a condition of the final disbursement of Project Costs
from the Project Fund,. the Lessor shall certify to the Trustee that: (i) all work was performed to its
satisfaction in accordance with the Plans and Specifications, (ii) that all necessary certificates, approvals,
licenses, and permits required to be obtained from any .governmental boazd, agency or department have
been obtained, including a certificate of occupancy if applicable, and (iii) all releases or waivers of
mechanic's and matenahnan's hens have been obtained m connection with the construction of the Project.
Concurrently with the delivery of such .certificate by the Lessor the Lessee shall deliver to the Lessor .and
the Trustee the Final Acceptance Certificate, evidencing the Lessee s acceptance of the Project as suitable
for use as a building and related improvements for a maintenance and service facility
(d) Upon the earlier of November 1 2007 or receipt .by the Trustee of the Final Acceptance
Certificate and receipt of the certificate of the Corporation as described in subsection (c) above, the
amount remaining m the Project Fund shall be transferred by the Trustee to the Debt Service Fund, and
the Project Fund shall be closed.
SECTION 6 02 Lease Payments (a) Dunng the Term, the Lessee shall pay to the Trustee for
the account of the Lessor the .Lease Payments from Appropriated lawfully available funds on the Lease
Payment Dates in accordance with the payment schedule attached hereto as Exhibit D-1 To the extent
permitted by law the Lease Payments not paid as of the date. of the next corresponding Bond Payment
16
Date shall bear interest at the lesser of 15% per annum or the highest rate penmtted by law The
Lessee ,shall be entitled to a credit against such Lease Payments at the times and in the amounts set forth
in, and detemm~ed in accordance with, the Trust Indenture, if any All Lease Payments received by
Trustee shall be applied m the manner required by the Trust Indenture. The Trustee may rely upon an
opimon of counsel m determm,ng the foregoing rate of interest.
(b) The Lessee agrees to pay from Appropriated lawfully available funds, the fees for services
and expenses of the Trustee, the cost of engagement of a rebate analyst, and any rebate to be paid to the
Umted States of Amenca required to be paid pursuant to the Trust Indenture and the Bond Resolutions.
(c) The Lease Payments and the fees and expenses of the Trustee pursuant to the Trust Indenture
shall be payable to the Trustee at its address specified in the Trust Indenture, or to such other person or
entity and at such other address as the Trustee may designate by written notice to the Lessee, in lawful
money of the United States of America.
(d) The Lessee further agrees to pay from Appropriated lawfully available funds other amounts
related to the operation and maintenance of the Project, including without linutation, utility charges,
ad valorem taxes (which shall be paid prior to their delinquency except as provided in Section 4 10)
which are unposed on the Project, if any and the premiums of insurance policies relating to the Project,
each in the amounts and at the tiiries as provided herein or in the Trust Indenture.
SECTION 6 03 Current Expenses. The obligations of the Lessee under this Lease, including its
obligation to pay the Lease Payments, shall constitute a current expense of the Lessee in each Fiscal Year
and shall not constitute an indebtedness of the Lessee within the meamng of the laws of the State.
Nothing herein shall constitute a pledge by Lessee of any taxes or other money other than Appropriated
lawfully available funds for the current Fiscal Year to the payment of Lease Payments due hereunder
SECTION 6 04 Lessee's Obheation. (a) Subject to subsection (b) of this Section, the obligation
of the Lessee to make Lease Payments shall be absolute and unconditional. Notwithstanding any dispute
arising with regard to the Project, the Lessee shall make all Lease Payments when due and shall not
withhold Lease Payments pending final resolution of any dispute related to the Project, nor shall Lessee
assert any right of set-off or counterclaun against its obligation to make such Lease Payments. The
Lessee's obligation to make Lease Payments shall not be abated through .accident or unforeseen
circumstances. The obligation to make Lease Payments is an independent covenant.
(b) The obligation of the Lessee to make Lease Payments is subject to the sufficiency of
Appropriated lawfully available funds. The Lessee presently intends to continue this Lease for the Term
and to pay all Lease Payments or other payments required hereunder The Lessee reasonably believes,
based upon current State law the Lessee's financial practices, and other factors, that lawfully available
funds in an amount .sufficient to make all such Lease Payments or other payments will be available for
such purposes. The Lessee's obligation, intent and belief under this Section 6 04 is subject to the proviso
m Section 2.01(e)
ARTICLE VII. OPTION TO PURCHASE
SECTION 7 Ol When Available On each Purchase Option Date, the Lessee shall have the
option to purchase the Lessor's interest m the Project for an amount equal to the Purchase Option Pnce.
SECTION 7 02. Exercise of Option. The Lessee shall give written notice to the Lessor and
Trustee of its intention to exercise its option to purchase not less than 45 calendar days pnor to the
Purchase Option Date on which the option to purchase is to be exercised and shall deposit with the
17
Trustee on or before such Purchase Option Date an amount of Appropnated lawfully available funds
equal to any and all unpaid Lease Payments to the extent not otherwise included within the calculation of
the Purchase Option Pnce, and any other amounts then due or past due and the applicable Purchase
Option Pnce less the funds held by the Trustee m the Project Fund, the Debt Service Fund, and the
Insurance and Condemnation Fund, on such date and available to redeem the Bonds pursuant to the teens
of the Trust Indenture. The Trustee shall use the money so deposited to redeem the Bonds in accordance
with the teens of the Trust Indenture.
,SECTION 7 03 Release of Lessor's Interest. (a) Upon Lessor's and Trustee s receipt of Lessee's.
notice of intention to exercise its option to purchase, the Lessor and the Trustee shall, concurrently
therewith or as soon as practicable thereafter take all reasonable actions at the request and expense of
Lessee necessary to authorize, execute, and deliver to the Lessee any and all documents necessary to vest
in the. Lessee all of the Lessor's nght, title, and interest in and to the Project by special warranty deed, free
and clear of all hens, leasehold interests, and encumbrances other than Permitted Encumbrances,
including, if necessary a release of any and all items or interests created under the provisions of this
Lease and the Trust Indenture.
(b) Upon deposit by Lessee in full of all amounts required by Section 7 02 hereinabove and upon
satisfaction of all requirements under Article VII of the Trust Indenture, the Lessee shall have no further
obligations under this Lease, and the Lessor and Trustee shall concurrently therewith or as soon as
practicable thereafter deliver to the Lessee any and all documents necessary to vest in the Lessee all of the
Lessor's right, title, and interest in and to the Project, free and clear of all liens, leasehold interests, and
encumbrances created under the provisions of this Lease, the Trust Indenture and the Development
Agreement.
(c) Upon the release and termination of this Lease and the execution by the Lessee and the
Lessor of a new lease relating to the Project due to the making of firm banking and financial or other
arrangements for the payment and discharge of the Bonds, the Lessee shall have no further obligations
under this Lease, but the Lessor shall retain its right, title and interest in and to the Project, free and clear
of all liens, leasehold interests and encumbrances relating to this Lease, so that the Lessor may encumber
the Project in connection with the execution. of a new lease relating to the Project.
ARTICLE VIII. ASSIGNMENT' SUBORDINATION
SUBLEASING MORTGAGING AND SELLING
SECTION 8 O1 Assignment by Lessor (a) The Lessor may assign its nght, title, and interest in
this Lease. The Lessee acknowledges that the Lessor will assign its nght, title, and interest, but not its
obligations, responsibilities, or liabilities, in the Lease Payments to the Trustee for the benefit of the
Bondholders. The Lessee shall pay all Lease Payments and all other amounts required to be paid by this
Lease to or at the direction of Trustee. The Lessor and the Lessee each represents, warrants, covenants,
and agrees that it will do, execute, acknowledge, and deliver all and every further act, deed, conveyance,
transfer .and assurance necessary or proper for the perfection of any and all of the security interests in .the
Lease Payments granted and provided for m the Trust Indenture, including but not lunited to executing or
causing to be executed .such financing statements and continuation statements as shall be necessary under
applicable law to perfect and maintain such security interests.
(b) Any rights of and obligations owed hereunder to the Trustee by the Lessee or the Lessor shall
be owed to the Trustee m its capacity as assignee of Lessor's nghts hereunder
SECTION 8 02 Assignment by Lessee. During the Tenn, the Lessee's interest in the Project may
not be assigned or subleased by the Lessee without the pnor written consent of the. Lessor and the
Trustee.
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SECTION 8 03 Restriction on Mortea~e or Sale of Pro3ect by Lessee. The Lessee may not
mortgage, sell, assign, transfer convey or otherwise encumber its mterest m the Project or any portion
thereof dunng the Term without the pnor wntten consent of the Lessor and the Trustee.
ARTICLE IX. THE BONDS
SECTION 9 Ol Issuance and Sale of the Bonds. Subject to applicable terms, lmutations, and
procedures, the Lessor will issue and sell the Bonds to finance the Project at such mterest rate or rates and
upon such terms as approved by the Lessee and m accordance rvrth applicable law
SECTION 9 02. Cooperation by Lessee. The Lessee shall take the action(s), enter into the
agreement(s) provide the certification(s) contemplated by this Lease, and otherwise cooperate with the
Lessor and its agents to effect the lawful issuance and sale of the Bonds.
SECTION 9 03 Maintenance of Tax Exempt Status of the Bonds. The Lessee and Lessor shall at
all times do and perform all acts permitted by law and necessary or desirable in order to ensure that the
interest on the Bonds shall be excludable from gross income for federal mcome tax purposes.
(a) The Lessee and Lessor covenant to take any action necessary. to assure, or refram from any
action which would adversely affect, the treatment of the Bonds as obligations described in section 103 of
the Code, the mterest .on which is not includable m the gross mcome of the holder for purposes of
federal mcome taxation. In furtherance thereof, the Lessee and Lessor covenant as follows
(i) to take any action to assure that no more than 10 percent of the proceeds of the Bonds
or the projects financed therewith (less amounts deposited to a reserve fund, if any) are used for
any 'pnvate business use, as defined in section 141(b)(6) of the Code or if more than 10 percent
of the proceeds or the projects financed therewith are so used, such amounts, whether or not
received by the I.eesse and Lessor with respect to such pnvate business use, do not, under the
teens of this Lease or any underlying arrangement, directly or indirectly secure or provide for the
payment of more than 10 percent of the debt service on the Bonds, m contravention of section
141(b)(2) of the Code,
(ii) to take any action to assure that m the event that the 'pnvate business use described
in subsection (i) hereof exceeds 5 percent of the proceeds of the Bonds or the projects financed
therewith (less amounts deposited into a reserve fund, if any) then the amount in excess of 5
percent is used fora 'pnvate business use which is 'related and not disproportionate, within
the meaning of section 141(b)(3) of the Code, to the govenunental use;
(iii) to take any action to assure that no amount which is greater than the lesser of
$5 000 000 or 5 percent of the proceeds of the Bonds (less amounts deposited into a reserve
fund, if any) is directly or indirectly used to finance loans to persons, other than state or local
governmental amts, m contravention of section 141(c) of the Code;
(iv) to refrain from taking any action which would otherwise result in the Bonds being
treated as 'pnvate activity bonds. within the meaning of section 141(b) of the Code,
(v) to refram from taking any action that would result in the Bonds being 'federally
guaranteed within the meaning of section 149(b) of the Code
19
(vi) to refrain from using any portion of the proceeds of the Bonds, dnrectly or indurectly
to acquure or to replace funds which were used, dnrectly or indurectly to acquure investment
property (as defined in section 148(b)(2) of the Code) which produces a materially higher yield
over the term of the Bonds, other than investment property acquired wrath
(1) proceeds of the Bonds invested for a reasonable temporary period of 3 years or
less or un the case of a refunding bond, for a period of 30 days or less until such proceeds
are needed for the purpose for which the bonds aze issued,
(2) amounts invested in a bona fide debt service fund, within the meamng of
section 1.148-1(b) of the Treasury Regulations, and
(3) amounts deposited in any reasonably requnred reserve or replacement fund to
the extent such amounts do not exceed 10 percent of the proceeds of the Bonds,
(vii) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as
proceeds of the Bonds, as may be necessary so that the Bonds do not otherwise contravene the
requirements of section 148 of the Code (relating to azbntrage) and, to the extent applicable,
section 149(d) of the Code (relating to advance refundings) and
(viii) to pay to the Umted States of America at least once during each five year penod
(begumm~g on the date of delivery of the Bonds) an amount that ns at least equal to 90 percent of
the 'Excess Earnings, within the meaning of section 148(f) of the Code and to pay to the Umted
States of Ameruca, not later than 60 days after the Bonds have been paud in full, 100 percent of
the amount then requnred to be paud as a result of Excess Earnings under sectnon 148(f) of the
Code.
In order to facuhtate compliance with the above covenant (vii), in the Indenture a 'Rebate Fund"
has been estabinshed by the Lessor for the sole benefit of the Umted States of America, and such fund
shall not be subject to the claum of any other person, including wnthout hunutatuon the Bondholders. The
Rebate Fund ns established for the addutuonal purpose of complnance with sectnon 148 of the Code.
The Lessee and Lessor understand that the term 'proceeds includes dusposntuon proceeds" as
defined in the Treasury Regulations and, in the case of refunding bonds, transferred proceeds (if any) and
proceeds of -the refunded bonds expended prior to the date of issuance of the Bonds. It us the
understanding of the Lessee and Lessor that the covenants contained hereon are untended to assure
complnance with the Code and any regulations or rulings promulgated by the U S Department of the
Treasury pursuant thereto In the event that regulatuons or rulnngs are hereafter promulgated whuch
modufy or expand provisuons of the Code, as applicable to the Bonds, the Lessee and Lessor will not be
requnred to comply wuth any covenant contained hereon to the extent that such failure to comply in the
opimon of natuonally recogmzed bond counsel, will not adversely affect the exemption from federal
income taxatuon of interest on the Bonds under section 103 of the Code. In the event that regulatuons or
rulings are hereafter promulgated which umpose addutuonal requirements whuch are applucable to the
Bonds, the Lessee and Lessor agree to comply wuth the addutuonal requuremeuits to the extent necessary in
the opimon of natuonally recognized bond counsel, to preserve the exemptuon from federal income
taxatuon of interest on the Bonds under sectnon 103 of the Code In furtherance of such intention, the
Lessee and Lessor hereby authorize and direct an authoruzed officer of the Lessee or the Lessor to execute
any documents, certificates or reports requnred by the Code and to make such elections, on behalf of the
Lessee and Lessor whuch may be permutted by the Code as aze consustent with the purpose for the
ussuance of the Bonds.
20
(b) The Lessor covenants to account for the expenditure of sale proceeds and investment
earnings to be used for the Project on its books and records in accordance with the requirements of the
Internal Revenue Code. The Lessee and Lessor recognize that in order for the proceeds to be considered
used for the reimbursement of costs, the proceeds must be allocated to expenditures within 18 months of
the,later of the date that (1) the expenditure is made, or (2) the Project is completed, but in no event later
than three years after the date on which. the ongmal expenditure is paid. The foregoing notwithstanding,
the Lessee and Lessor recognize that in order for proceeds to be expended under the Code, the sale
proceeds or investment earnings must be expended no more than 60 days after the earlier of (1) the fifth
anniversary of the delivery of the Bonds, or (2) the date the Bonds aze retired. The Lessee and Lessor
agree to obtain the advice of nationally-recognized bond counsel if such expenditure fails to comply with
the foregomg to assure that such expenditure will not adversely affect the tax-exempt status of the Bonds.
For purposes hereof, the Lessee and Lessor shall not be obligated to comply with this covenant if the.
Lessee or the Lessor obtains an opinion from nationally-recognized bond counsel that such failure to
comply will not adversely affect the excludability for federal income tax purposes from gross income of
the interest.
(c) The Lessee and. Lessor covenant that the property constituting the Project will not be sold
or otherwise disposed of in a transaction resulting m the receipt by the Lessee and/or Lessor of cash or
other compensation, unless the Lessor obtains an opinion of nationally recognized bond counsel that such
sale or other disposition will not adversely affect the tax-exempt status of the interest due on the Bonds.
For purposes of the foregoing, the portion of the property compnsing personal property and disposed of
m the ordinary course shall not be treated as a transaction resulting in the receipt of cash or other
compensation. For purposes hereof, the Lessee and Lessor shall not. be obligated to comply with this
covenant if the Lessee or the Lessor obtains an opinion from nationally-recognized bond counsel that
such failure to comply will not adversely affect the excludability for federal income tax purposes from
gross income of the interest.
SECTION 9 04 Continum~ Disclosure Undertakm~. For long as the City is a Lessee under the
terms of this Lease, it shall undertake to perform the following:
(a) Annual Reports (i) The Lessee shall provide annually to each NRMSIR and any SID
within six months after the end of each Fiscal Year ending in or after 2004 financial uifonnation and
operating data with respect to the Lessee of the general type included an the final Official Statement
authorized by the Serves 2004 Bond Resolution. Any financial statements so to be provided shall be (1)
prepared in accordance with the accounting pnnciples described in the Serves 2004 Bond Resolution, or
such other accounting principles as the Lessee may be required to employ from time to tune pursuant to
state law or regulation, and (2) audited, if the Lessee commissions an audit of such statements and the
audit is completed within the penod during which they must be provided. If the audit of such financial
statements is not complete within such period, then the Lessee shall provide unaudited financial
statements within such penod and shall provide audited financial statements for the applicable Fiscal Yeaz
to each NRMSIR (as defined in the Senes 2004 Bond Resolution) and any SID (as defined m the Serves
2004 Bond Resolution), when and if the audit report on such statements becomes available
(ii) If the Lessee changes its Fiscal Year it will notify each NRMSIR and any .SID of the change
(and of the date of the new Fiscal Year end) prior to the next date by which the Lessee otherwise would
be required to provide financial information and operating data pursuant to this Section. The financial
information and operating data to be provided pursuant to this Section may be set forth m full in one or
more documents or may be included by specific reference to any document (including an official
statement or other offering document, if it is available from the MSRB as defined m the Senes 2004
Bond Resolution) that theretofore has been provided to each NRMSIR and any SID or filed with the SEC
(as defined in the Senes 2004 Bond Resolution)
21
(b) Maternal Event Notices The Lessee shall notify any SID and either each NRMSIR or the
MSRB, in a tunely manner of any of the following events with respect to the Bonds, of such event ns
matenal within the meaning of the federal secunties laws
1 Prnncnpal and interest payment delinquencies;
2. Non-payment related defaults,
3 Unscheduled draws on debt service reserves reflecting financial difficulties
4 Unscheduled draws on crednt enhancements reflecting financnal difficulties,
5 Substitution of crednt or liquidnty providers, or them failure to perform,
6 Adverse tax opuions or events affecting the tax-exempt status of the Bonds,
7 Modnficatnons to nghts of holders of the Bonds
8 Bond calls,
9 Defeasances,
10 Release, substntution, or sale of property secunng repayment of the Bonds, and
11 Rating changes.
The Lessee shall notify any SID and either each NRMSIR or the MSRB in a timely manner of
any failure by the Lessee to provide financnal infonnatnon or operating data in accordance wrath subsection
{a) of this Section by the tune requnred by such subsection. '
(c) Lnmitatnons. Disclaimers, and Amendments. (i) The Lessee shall be obligated to observe and
perform the covenants specified in this Section for so long as, but only for so long as, the Lessee remains
an obingated person with respect to the Bonds within the meaning of the Rule (as defined in the 2004
Bond Resolution) except that the Lessee nn any event will grave notice of any deposnt made in accordance
wrath the Bond Resolutnons or applicable law that causes Bonds no longer to be outstanding.
(ii) The provnsnons of thus Section are for the sole benefit of the Holders and beneficial owners of
the Bonds, and nothing in thus Sectnon, express or inplned, shall gave any benefit or any legal or equitable
rnght, remedy or clanm hereunder to any other person. The Lessee undertakes to provnde only the
financnal information, operating data, financnal statements, and notnces whnch rat has expressly agreed to
provnde pursuant to thus Sectnon and does not hereby undertake to provide any other uifonnation .that may
be relevant or maternal to a complete presentatnon of the Lessee's financnal results, condntion, or prospects
or to update any information provnded m accordance wrath thus Sectnon or othenwnse, except as expressly
provnded herein. The Lessee does not make any representation or warranty conceiving such uformation
or rats usefulness to a decnsion to invest in or sell Bonds at any future date.
(iii) UNDER NO CIRCUMSTANCES SHALL THE LESSEE BE LIABLE TO THE HOLDER
OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON IN CONTRACT OR TORT
FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE LESSEE,
WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART OF .ANY COVENANT SPECIFIED
IN THIS SECTION BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON IN CONTRACT
OR TORT FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN
ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.
(iv) No default by the Lessee in observing or performing rats obligations under this Section shall
comprnse a breach of or default under .thus Lease for purposes of any other provnsnon of thus Lease..
Nothing in this Sectnon ns intended or shall act to dnsclairri, waive, or otherwise limnt the dunes of the
Lessee under federal and state secuntres laws.
22
(v) The provisions of this $ection may be amended from tune to tune to adapt to changed
circumstances that arse from a change in legal requirements, a change in law or a change in the identity
nature, status, or type of operations of the Lessee, but only if (1) the provisions of this Section, as so
amended, would have permitted an underwater to purchase or sell Bonds in the prunary offering of the
Bonds in compliance with the Rule, taking into account any amendments or interpretations of the Rule
since such offering as well as such changed circumstances and (2) either (a) the Holders of a ma~onty in
aggregate principal amount of the outstanding Bonds consent to such amendment or (b) a person that is
unaffiliated with the Lessee (such as nationally recognized bond counsel) determines that such
amendment will not materially unpair the interest of the holders and beneficial owners of the Bonds. If
the provisions of this Section are amended, the .amendment shall include with any amended financial
information or operating data next provided in accordance with subsection (a) of this Section an
explanation, in narrative form, of the reason for the amendment and of the unpact of any change in the
type of financial information or operating data so provided.
ARTICLE X. REMEDIES
SECTION 10 O1 Remedies on Event of Default of Lessee. (a) Upon an Event of Default of the
Lessee, the Lessor or the Trustee, on behalf of the Lessor shall have the right, to the extent permitted by
applicable law to take one or any combination of the following remedial steps
(i) tennmate the Lessee's nght to possess the Project without tenninaring this -Lease by giving
written notice thereof to the Lessee, in which event the Lessee shall pay to the Lessor (A) all Lease
Payments and other amounts accrued hereunder to the date of termination of possession, and (B) all Lease
Payments during the remainder of the then current Fiscal Year to the extent of Appropriated lawfully
available funds, duninished by any net sums thereafter received by the Lessor or the Trustee, as
applicable, m relettmg the Project. Unless the Lessor or the Trustee delivers wntten notice to the Lessee
expressly stating that it has elected to terminate this Lease, all actions taken by the Lessor or the Trustee
to dispossess or exclude the .Lessee from the Project shall be deemed to be taken under this Section
10 O1(a)(i), or
(ii) terminate this Lease by giving the Lessee 30 days written notice thereof, in which even (A) at
the expiration of which period of time the Lessee shall immediately surrender possession and control of
the Project to the Lessor or the Trustee, and (B) the Lessee shall pay to the Lessor the sum of (1) all Lease
Payments and other amounts accrued hereunder through the date of termination, and (2) an amount equal
to (I) the total Lease Payments that the Lessee would have been required to pay for the remainder of the
then current Fiscal Year to the extent of Appropriated lawfully available funds discounted to the present
value at a per annum rate equal to percent L-%) per annum, minus (II) the then present fair
rental value of the Project for such period, sunilarly discounted, or
(iii) with or without notice, and to the extent permitted by law alter locks or other secunty
devices at the Project to deprive the Lessee of access thereto however if the Lessee's right of possession
of the Project has not been terminated under Section 10 O1(a)(Ij and if this Lease has not been tennuiated
under Section 10 O1(a)(ii), then the Lessor or the Trustee, as applicable, shall permit the Lessee to regain
access to the Project when the Event of Default is cured (including payment of all costs and expenses
incurred by the Lessor the Trustee, or the Bondholders resulting therefrom), and, further the Lessee
shall, to the extent of Appropriated lawfully available funds, continue to be responsible for the Lease
Payments that accrue during such lock-out period, or
(iv) take whatever action at law or in equity may appear necessary or desirable to collect the
Lease Payments then due or as they become due during the Term or to enforce performance and
observance of any other obligations, agreement, or covenant of the Lessee under this Lease
23
(b) Upon the termination of this Lease by the Lessor the Lessee shall ummediately surrender
possession of the Project to the Trustee.
SECTION 10 02. Notices of Appropriation or Nonappropriation, Termination on Event of
Nonappropriation. (a) On or before the last day of each Fiscal Year the Lessee shall deliver to the Lessor
and the Trustee written certification of its appropriation of available funds sufficient to pay Lease
Payments and other payments required, if any to be made by the Lessee under this Lease during the next
succeeding Fiscal Yeaz such certification to be in substantially the form attached as Exhibit F hereto (the
'Certificate of Appropriation')
(b) In addition, the Lessee shall provide the Lessor and the Trustee with written notice within 72
hours of action by the governing body of the Lessee during any Fiscal Yeaz which would constitute a
failure to Appropriate available funds in an amount which is sufficient to pay the Lease Payments, and
any other payments, if any required to be made by the Lessee in accordance with this Lease due during
such Fiscal Yeaz
(c) In the event that the Trustee does not receive the Certificate of Appropriation from the Lessee
within the tune period required m Section 10 02(a) hereof, the Trustee shall promptly give written notice
thereof to the Lessee and the Lessor Thereafter if the Lessee fails to deliver the Certificate of
Appropriation within calendaz ten days of its receipt of the foregoing notice from the Trustee, the Trustee
shall promptly give written notice to the Bondholders of its failure to timely receive the Certificate of
Appropriation. The Trustee shall also give prompt written notification to the Bondholders of its receipt of
a notice from the Lessee pursuant to paragraph (b) of this Section.
(d) Upon the occurrence of an Event of Nonappropriation, without further demand or notice, this
Lease shall ternunate at the end of the Fiscal Yeaz for which sufficient Appropriations have been made,
and the Lessee shall immediately upon the expiration of the said Fiscal Year surrender possession and
control of the Project to the Lessor and convey or release its interest in the Project to the Lessor
(e) Upon termination of this Lease pursuant to Section 10 02(d), if the Lessee has not delivered
possession and control of the Project to the Lessor or Trustee and conveyed or released its interest m the
Project as therein required, the termination shall nevertheless be effective, but the Lessee shall be
responsible, from and to the extent of lawfully available funds as provided in this Lease and the Trust
Indenture, for the payment of damages in an amount equal to the amount of Lease Payments which
thereafter would have come due in the absence of an Event of Nonappropriation which aze attributable to
the number of days during which the Lessee fails to take such actions
SECTION 10 03 Remedies on Event of Default of Lessor Upon an Event of Default of the
Lessor the Lessee or the Trustee shall have the right, to the extent permitted by law upon ten calendaz
days written notice delivered to the Lessor by the Lessee or the Trustee, to take one or any combination
of the following remedial steps.
(a) bring suit for specific performance requiring Lessor to complete construction of the Project m
accordance with the teens and provisions hereof, or
(b) take whatever action at law or in equity may appear necessary or desirable to enforce
performance and observance of any other obligation, agreement, or covenant of the Lessor under this
Lease.
The remedies conferred on .the Lessee upon the occurrence of an Event of Default of the Lessor
are the Lessee s exclusive remedies
24
SECTION 10 04 Lessor's Lien. The Lessee hereby grants to the Lessor as security for Lease
Payments due and to become due for the Term, a security mterest in all machinery equipment,
furruslungs, and other articles of tangible personal property of every kind and nature acquired by the
Lessee with the amounts deposited into the Project Fund pursuant to this Lease, and all additions,
substitutions, or replacements thereto and proceeds thereof.
SECTION 10 OS Delay; Notice. No delay or omission to exercise any right or power accruing
upon any Event of Default or Event of Nonappropnation shall impair any such right or power or shall be
construed to be a waiver thereof, but any such right or power may be exercised from time to tune and as
often as may be deemed expedient. In order to entitle any party to exercise any remedy reserved to it in
this Lease it shall not be necessary to give any notice, other than such notice as may be required in this
Lease.
SECTION 10 06 No Remedv Exclusive. To the extent not otherwise provided herein, no remedy
herein conferred upon or reserved to the Lessor or the Lessee is intended to be exclusive, and every such
remedy shall be cumulative and shall be in addition to every other remedy given under this Lease or now
or hereafter existing atlaw or in equity
SECTION 10 07 No Additional Waiver Implied by One Waiver In the event any agreement
contained in this Lease should be breached by either party and thereafter waived by the other party such
waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other
breach hereunder
ARTICLE XI. TITLE
(a) During the Term, legal title to the Project and any and .all repairs, replacements, substitutions,
and modifications to the Project shall be in the Lessor subject to the Permitted Encumbrances and the
Financing Documents: After delivery of the Final Acceptance Certificate, the Lessee shall not permit any
hen or encumbrance of any kind to exist against the title to the Project while this Lease is in effect, other
than the Permitted Encumbrances and the Financing Documents. Upon termination of this Lease under
Section 5 O1 subsection (a) or (d) hereof, full and unencumbered, with the exception of the Permitted
Encumbrances, legal title to the Project shall immediately be conveyed by Lessor to the Lessee, and the
Lessor shall execute and deliver to the Lessee such documents as the Lessee may request to evidence the
conveyance of such title to the Lessee and the termination of the Lessor's mterest m the Project.
(b) Upon the release and termination of this Lease under Section 5 O1(e) hereof and the
execution by the Lessee and the Lessor of a new lease relating to the Project due to the making of firm
banking and financial or other arrangements for the payment and discharge of the Bonds, the Lessee shall
have no further obligations under this Lease, but the Lessor shall retain its right, title and mterest m and to
the Project, free and clear of all liens, leasehold interests and encumbrances relating to this Lease, so that
the Lessor may encumber the Project in connection with the execution of a new lease relating to the
Project.
ARTICLE XII. HAZARDOUS MATERIALS
SECTION 12.01 Restrictions Regarding Hazardous Substances Except as provided in Section
12.06 the Lessee, its agents, employees, contractors, affiliates, licensees, or invitees (within this Article
XII collectively designated the 'Lessee') shall not generate, manufacture, store, dispose of, or otherwise
use or hold on or under or about the Project or transport to, from, or across the Project .any Hazardous
Substances (as.-defined below in this Section 12 Ol) without the prior written consent of the Lessor which
consent shall not be unreasonably withheld. The Lessee shall at no time permit, suffer or acquiesce m
any other person undertaking the foregoing without the Lessor's written consent, which shall not be
25
unreasonably withheld. For purposes of this Article XII and to the extent permitted by law any acts or
omissions of the Lessee or others acting for or on behalf of the Lessee (whether or not they aze negligent,
intentional, willful, or unlawful) shall be strictly attributable to the Lessee. The Lessee shall give the
Lessor and the Trustee at least 30 days written notice of the Lessee's intention to generate, manufacture,
store, use, dispose of, or transport any Hazazdous Substances. The Lessor shall have ten days in which to
approve or disapprove such actions in a written instrument delivered to the Lessee and the Trustee. As
used herein, 'Hazardous Substances means any oil, flammable materials, explosives, asbestos,
radioactive materials or wastes, medical waste, or other hazazdous, extremely hazazdous, toxic,
contaminated or polluting materials, substances, chemicals, or wastes including, without lmrutation, any
'hazardous" or 'toxic substances wastes, or materials under any federal, state, or local law ordinance,. or
regulation relating to industrial hygiene, environmental protection, or the use, analysis, generation,
manufacture, storage, or transportation of such substances (collectively 'Hazazdous Substance Law(s)")
The Land was remediated pursuant to the Texas Risk Reduction Program (TRRP), Chapter 350 of Title
30 of the Texas Administrative Code, under the ~unsdiction of the Texas Commission on Environmental
Quality (TCEQ) and EPA Region 6 A Phase I Environmental Site Assessment was completed on the
Land and issued on May 5 1998 on behalf of the U S General Services Administration ("Phase I"
attached hereto as part of Exhibit H) A Phase II Environmental Assessment was completed on the Land
and issued on January 22, 2004 ("Phase II" attached hereto as part of Exhibit H) The TCEQ issued a
letter dated April 19 2004 (attached as part of Exhibit H) stating that the TRRP Remedy Standard A
Commercial/Industrial protective concenEration levels ("PCLs ') have been achieved such that no `Post
Response Action Caze is required, however institutional controls are .required. The TCEQ issued a
second letter dated May 19 2004 (attached as part of Exhibit H) concerning ongoing responsibilities on
the property As part of the TRRP a `Deed Notice complying with the requirements of TRRP has been
filed on the property identifying certain environmental conditions and/or required use linutations
(attached as part of Exhibit H) The affected property currently meets the TRRP standards for
commercial/industrial. use only and not for residential purposes. No remediation rs required by the TCEQ
as long as the affected property is not to be used for residential purposes. The parties hereto acknowledge
that institutional controls have been placed on the Land.
SECTION 12 02. Compliance wrath Hazardous Substance Laws The Contract Documents shall
require the Developer trade contractors and subcontractors, at their own expense, to comply wrath all
Hazardous Substance Laws The Lessee shall, at its own expense, (i) comply wrath all Hazardous
Substance Laws, including, without limitation, those controlling the dischazge of materials or wastes into
or through any sanitary sewer serving the Project; (ii) shall cause any and all Hazardous Substances
removed from the Project to be removed and transported solely by duly licensed haulers to duly licensed
facilities for final disposal of such materials and wastes, except as dischazged into the sanitary sewer in
strict accordance and confornuty with all applicable Hazardous Substance Laws, and (iii) cause all
contamination to be cleaned up or all Hazardous Substances to be removed from the Project and
transported for use, storage, or disposal, in accordance and compliance with all Hazazdous Substance
Laws.
SECTION 12.03 Trustees Right to Conduct Assessments. Upon the occurrence and during the
continuation of an Event of Default or an Event of Nonappropnation, the Trustee and its agents and
representatives shall have the right upon reasonable prior notice to the Lessor and the Lessee and during
regular business hours to enter and visit the Project for the purposes of observing the Project and
conducting environmental assessments, which assessments may involve tests on any part of the Project,
including, without limitation, taking and removing soil or groundwater samples The Trustee has no duty
however to visit or observe the Project or to conduct tests, and no site visa, observation or testing by the
Trustee or rats agents shall unpose any liability on the Trustee. In no event shall any site visit, observation
or testing by the Trustee or its agents be a representation that there has been or shall be compliance with
any Hazardous Substance Law Neither the Lessee nor any other party is entitled to rely on any site visit,
26
observation or testing by the Trustee as aforesaid, unless expressly granted by the Trustee. The Trustee
owes no duty of care to protect the Lessee, the Lessor or any other party against, or to inform the Lessee,
the Lessor or any other party of, any adverse condition affecting the Protect. The Trustee may in its
discretion disclose to the Lessee, the Lessor or any other party (except to any governmental authority if
required by law) any report or finding made as a result of, or in connection with, any site visit,
observation or testing by the Trustee. The Lessee understands and agrees that the Trustee makes no
wazranty or representation to the Lessee or any other party regarding the truth, accuracy or completeness
of any such report or findings that may be disclosed. The Lessee also understands that, depending on the
results of any site visit, observation or testing by the Tnzstee and disclosed to the Lessee, the Lessee may
have a legal obligation to notify orie or more governmental authorities of the results, that such reporting
requirements aze site-specific, and aze to be evaluated by the Lessee without advise or assistance from the
Trustee. The Trustee shall make reasonable efforts to avoid interfering with the Lessee's use of the
Protect m exercising any rights provided m this subsection. The Lessee acknowledges that the Trustee
cannot control or otherwise assure the truthfulness or accuracy of the results of any of its environmental
inspections and. that the release of such results to prospective bidders at a foreclosure or sale of the Protect
may have a material adverse effect upon the amount which a party may bid at such sale. The Lessee
agrees that the Trustee shall have no liability whatsoever as a result of delivering the results of any of its
environmental inspections to any thud party
SECTION 12.04 Remedial Action. Notwithstanding the foregoing, upon 30 days written notice
to the Lessee, the Lessor may at its sole option (but without any obligation to do so), and, to the extent
permitted by law at the Lessee's sole cost and expense from Appropriated lawfully available funds, (a)
undertake any remedial action to remove any Hazardous Substances from the Protect or clean-up any
contamination resulting from the Lessee's violation of any of the requirements of this Article and/or (b)
participate m any proceeding under any Hazardous Substance Law against the Lessee or relating to the
Protect azismg from the Lessee's violation of any of the requirements of this Article.
SECTION 12.05 Discovery of Hazardous Substances. Except as provided in Section 12.06 if
the Lessee determines or has reasonable cause to believe that any Hazardous Substances are located on or
beneath the Protect, then upon such discovery or suspicion of the presence of the Hazazdous Substances
the Lessee shall inunediately give written notice of that condition to the Lessor and to the Trustee and
shall conduct at its expense (but solely from legally available funds) environmental assessments on the
Land.
SECTION 12.06 Lessee's Limited Right to Maintain Hazardous Materials The Lessor
acknowledges and agrees that the Lessee will be operating a municipal facility on the site of the Protect,
and that m the ordinary course of operating the facility the Lessee may have need to use and store above
ground or underground reasonable quantities of Hazardous Substances. The Lessor further acknowledges
and agrees that nothing herein shall prohibit, and the consent of the Lessor is hereby expressly granted,
and no further notice is required to the Lessor or Trustee, for the use, disposal, storage, or possession on
under or about the Protect of such Hazardous Substances as are necessary for or incidental and related to
the Lessee's performance of its obligations .contained in this Lease related to the Lessee's operation of a
mumcipal facility on the site of the Protect and to the maintenance, repair and preservation of the Protect.
The Lessee agrees to provide .the Lessor and the Trustee upon the Lessor's or Trustee's reasonable request,
any and all information concerning Hazardous Substances used or stored m connection with the operation
of the Protect, including without limitation, inventory records, manifests, and material safety data sheets
The Lessor's acknowledgment of the Lessees possible storage or use of Hazardous Substances on the site
of the Protect does not release the Lessee from any of its obligations under this Lease. If the Lessee
receives notice from any local, state, or federal governmental agency of any proposed action against the
Lessee under or in violation of any Hazardous Substance Law pertaining to the Protect, the Lessee shall
promptly provide the Lessor and the Trustee with a copy of such notice.
27
ARTICLE XIII. MISCELLANEOUS PROVISIONS
SECTION 13 O1 Notices. (a) All notices, certificates, or other communications hereunder shall
be in wasting and delivered by certified mail, return receipt requested, telex, telegram, or other electronic
transrnission, or by express or personal delivery prepaid, and addressed as follows
(i) If to the Lessee or the Lessor to the address set forth on the signature page hereof;
{ii) If to the Trustee' Wells Fargo Bank, National Association
505 Main Street, Surte 301
Fort Worth, Texas 76102
Attention. Mark Dunn
Phone 817 334-7061 Fax. 817-885-8650
(iii) If to the Concho Development I, LP
Deyeloper• 100 East 15~' Street, Surte 640
Fort Worth, Texas 76,102
Attention. Pat Cornell
Phone• ,Fax.
(b) Any party to this Lease may designate any additional or different address to which
communications under this Lease shall be delivered by giving at least five days advance notice thereof to
the affected party(ies)
(c) A provision of this Lease that provides for a different method of giving nonce or otherwise
conflicts with this Section supersedes this Section to the extent of the conflict.
(d) A copy of all notices delivered hereunder shall be delivered to the Trustee. Notices sent by
mail shall be deemed delivered five days after deposit in the U S mail, certified, return receipt requested,
.postage prepaid, provided that Notices sent by any means other than such U S mail and any Notice sent
to the Trustee shall be deemed delivered only upon receipt.
SECTION 13 02. Binding Effect. This Lease shall more to the benefit of and shall be binding
upon Lessor and Lessee and then respective successors and assigns, as and to the extent permitted by law
and the terms of this Lease.
SECTION 13 03 Severability In the event any provision of this Lease shall be held invalid or
unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render
unenforceable any other provision hereof.
SECTION 13 04 Amendments, Chances and Modifications The Lessee and the Lessor by
mutual agreement in wasting, may amend this Lease if, before the amendment takes effect:
(a) the Lessee and the Lessor obtain an opinion of their legal counsel to the effect that such
amendment is permitted under the law governing the Lessee and the Lessor
(b) the Lessor obtains an opinion of nationally-recognized Bond Counsel to the effect that such
amendment will not adversely affect the status of the Bonds as obligations described by section 103 of the
Code, the interest on which is excludable from gross income for federal income tax purposes, and
(c) either of the following requirements is satisfied.
28
(i) the Lessor obtains an opinion of counsel acceptable to the Trustee that such
amendment will not adversely effect the nghts of the Bondholders, or
(ii) the owners of at least 51% m aggregate principal amount of the Outstanding Bonds
affected by such amendment consent thereto, except that the consent of the owner of each
Outstanding Bond affected by such amendment is requued if .such amendment would decrease
the muumum percentage of Bondholders requued for effective consent to such amendment, or if
such amendment affects the amount of the Lease Payments or the Lease Payment Dates.
SECTION 13 OS Approval and. Re~stration. The Lessee Representative is hereby authonzed to
have control of this Lease and all necessary records and proceedings pertauung to this Lease pending the
investigation, examination, and approval by the Attorney General of the State of Texas of the Bonds.
SECTION 13 06 Execution m Counterparts. This Lease may be executed in several
counterparts, each of which -shall be an onginal and ali of which shall constitute. but one and the same
mstnunent.
SECTION 13 07 Applicable Law This Lease shall be governed by and construed m accordance
with the laws of the State.
SECTION 13 08 Complete Agreement. This Lease supersedes and takes the place of any and all
previous agreements entered into between the parties hereto with respect to the subject matter hereof.
SECTION 13 09 Survival of Representations and Warranties The representations, covenants,
and warranties contained in this Lease shall survive the termination of this Lease.
SECTION 13 LO Time of Essence. Time is of the essence m this Lease.
SECTION 13 11 References to Lessor References to Lessor with respect to nghts, title, and
interest of Lessor .(but not its obligations, responsibilities and liabilities) shall mean the Trustee.
References to Lessor with respect to obligations, responsibilities, and liabilities shall mean Service Center
Relocation, Incorporated and shall not include the Trustee. References to consent or approval of the
Lessor shall be deemed a nght of the Lessor It is specifically provided that the Trustee is a thud party
beneficiary hereunder and that there is no other thud party beneficiary to this Lease
SECTION i3 12. Secunty Interest. In order to secure all of its obligations hereunder Lessee
hereby (i) grants to Lessor a first and pnor secunty interest m any and all nght, title, and interest of
Lessee in the personal ,property portion of the Project purchased or otherwise acquued with amounts on
deposit m the Project Fund, and in all additions, attachments, accessions, and substitutions thereto, and on
any proceeds therefrom, (ii) agrees that this Lease or any other document may be filed as a financing
statement evidencing such secunty interest, and (iii) agrees to execute and deliver all financing
statements, certificates of title, and other instruments necessary or appropriate to evidence such secunty
interest.
[Execution page follows]
29
IN WITNESS WHEREOF the Lessor has caused this Lease to be executed m rts corporate name
by rts duly authorized officer and the Lessee has caused this Lease to be executed m its name by rts duly
authonzed officer as' of the date first wntten above.
LESSOR OR CORPORATION
SERVICE CENTER
RELOCATION INCORPORATED
ATTEST
Secretary of the Board of Du'ectors
President of the Board of Directors
Address 1000 Throckmorton
Fort Worth, TX 76102
[CORPORATION SEAL)
ATTEST
City Secretary
APPROVED AS TO FORM.
City Attorney
[CITY SEAL]
LESSEE OR CITY
CITY OF FORT WORTH, TEXAS
Interun City Manager
Address 1000 Throckmorton
Fort Worth, TX 76102
EXECUTION PAGE FOR LEASE
30
STATE OF TEXAS §
COUNTY OF TARRANT §
This instrument was acknowledged before me on 2004 by
Wendy Davis, President of the Board of Directors of the SERVICE CENTER RELOCATION
INCORPORATED a Texas nonprofit corporation, on behalf of said corporation.
[NOTARY S E A L]
Print Name
Notary Public m and for the State of Texas
My Commssion expires
STATE OF TEXAS §
COUNTY OF TARRANT §
This instrument was acknowledged before me on , 2004
by Charles Boswell, as Interun City Manager of the CITY OF FORT WORTH, TEXAS
Printed Name•
Notary Public m and for the State of Texas
My Commission expires
[NOTARY S E A L]
ACKNOWLEDGMENT PAGE FOR LEASE
31
EXHIBIT A
LEGAL DESCRIPTION
Al
EXHIBIT B
FORM OF FINAL ACCEPTANCE CERTIFICATE
The CITY OF FORT WORTH, TEXAS as lessee under that certain LEASE WITH AN OPTION
TO PURCHASE AGREEMENT dated as of October 1 2004 (the 'Lease"), with SERVICE CENTER
RELOCATION INCORPORATED (the 'Lessor"), hereby acknowledges receipt in good condition of all
of the property and improvements described in Exhibit A attached hereto and in the plans and
specifications, hereby accepts such property and improvements and hereby certifies that the Lessor has
fully and satisfactorily performed all covenants and conditions to be performed by rt under the Lease. with
regazd to the acquisition, design, construction, and installation of such property and improvements, that
such property and improvements constitute all of the Project as that term is defined in the Lease, and that
such property and improvements are suitable for use as a building and related unprovements for a
maintenance and service facility in conformity with all applicable local, State, and federal law
There is no litigation, action, suit, or proceeding, pending, or to the best of my knowledge,
threatened before any court, admuustrative agency arbitrator or governmental body that challenges the
organization or existence of the City• the authority of their respective officers and officials, the proper
authorization, approval, or execution of the Lease and other authorization, approval, or execution of the
Lease and other documents contemplated thereby or the ability of the City otherwise to perform its
obligations under the Lease and the other documents and the transactions contemplated thereby
By executing this Certificate, Lessee hereby waives as to the Bondholders and the Trustee .any
warranty of merchantability or suitability for commercial purposes, express or unphed.
By accepting the Project, Lessee does not waive its right to enforce construction and
manufacturers warranties with respect to the Developer contractors or subcontractors, and the materals
and equipment suppliers. The acceptance by Lessee of the Project shall also not waive or relingwsh
Lessee's rights to require the Developer contractors or subcontractors and material and equipment
suppliers to complete. all punchhst items.
This Certificate does not and shall not prejudice any rights against thud parties presently extant
on the date hereof or which may come into existence hereafter
DATE
CITY OF FORT WORTH, TEXAS
By
Title•
B-1
[Exhibit A to be attached to Final Acceptance Certificate]
Exhibit A
The real property located in Tarrant County
legal descnption of Land], together with the building
service- facility and all nnprovements related thereto tc
all items of personal property acquired with amounts
Lease) for and on behalf of. and for the use of the Lessee.
Texas, described. m Attachment A hereto [attach
and related improvements for a mamtenance and
be constructed thereon pursuant to the Lease and
~n deposit m the Project Fund (as defined m the
B-2
EXHIBIT C
LIST OF PERMITTED ENCUMBRANCES
'Pennithed Encumbrances" means, as of any particular tune, (i) the Lease, the Trust Indenture, the
Bond Resolution, and the Bonds, and (ii) presently existing utility access, and other easements and rights
of way restrictions, and exceptions (other than hens) described in the title policy delivered to the Trustee
at the tune of execution of the Lease•
[List Other Permitted Encumbrances]
C-1
EXHIBIT D-1
INITIAL LEASE PAYMENT SCHEDULE
[See Attached]
D-1
EXHIBIT D-2
PURCHASE OPTION PRICE
[See Attached]
D-2
EXHIBIT E
TYPES AND AMOUNTS OF REQUIRED INSURANCE
In accordance with the Texas Tort Clauns Act, the Lessee s liability is limited to money damages u7 a
maximum amount of $250 000 for each person and $500 000 for each single occurrence for bodily injury
or death and $100 000 for each single occurrence for injury to or destruction of property for all
government functions. Damage for which the Crty of Fort Worth would ultunately be found liable would
be paid duectly by the City through its self funded program and not by a commercial insurance company
Statutory workers compensation insurance, coverage is self funded to the $500 000 00 retention lumt per
incident over which commercial coverage responds with no upper cap and, employer s liability coverage
is maintained at the $1 000 000 00 policy linut.
The Lessee maintains a commercial Excess General Excess Liability and Excess Workers Compensation
policy with a seven hundred fifty thousand dollazs ($750 000) self-insured retention, per occurrence and
as respects combined insured damages and insured allocated costs and expenses of investigation, defense,
negotiation, and settlements applicable to such- damages The excess general liability lumt for all damages
for all bodily injury and property damage l~abihty coverages provided by commercial policy including
damages for care and loss of services, shall not be greater than one million dollazs ($1 000 000) per
occurrence and the sum of three million dollazs ($3 000 000) m the aggregate.
E1
EXHIBIT F
FORM OF CERTIFICATE OF APPROPRIATION
CERTIFICATE OF APPROPRIATION
I, the undersigned, bemg the duly appomted City Manager of the City of Fort Worth, Texas (the
'City or the 'Lessee', do hereby certify as follows
1 This certificate is given in accordance with Section 10 02(a) of that certain 'Lease With an
Option to Purchase Agreement" dated October 1 2004 (the 'Lease'd by and between Service Center
Relocation, Incorporated (the 'Lessor's and the Lessee. All caprtahzed terms used herem and not
otherwise defined have the meanings assigned m the Lease.
2. On the _ day of ,the City Council of the Lessee adopted a
budget for the Fiscal Year commencmg October 1 and endmg September 30
which includes the Lease Payments and other payments required, if any to be made by the Lessee under
the Lease dunng such Fiscal Year
Dated.
City Manager
Fi
EXHIBIT G
LIABILITY INSURANCE COVERAGE REQUIREMENTS
Contractor's Coverage
G-1
fi.~
EXHIBIT H
ENVIRONMENTAL ASSESSMENTS AND RELATED MATERIALS
H1
SERVICE CENTER RELOCATION INCORPORATED
(a nonprofit corporation acting on behalf of the City of Fort Worth, Texas)
$23,425,000
LEASE REVENUE BONDS, SERIES 2004
(SERVICE CENTER PROJECT)
BOND PURCHASE AGREEMENT
November _ 2004
Board of Directors
Service Center Relocation, Incorporated
1000 Throckmorton
Fort Worth, Texas 76102
The Honorable Mayor and
Members of the City Council
City of Fort Worth
1000 Throckmorton
Fort Worth, Texas 76102
Ladies and Gentlemen.
The undersigned Oppenheimer & Co RBC Dain Rauscher Inc. and Samuel A.
Ramirez & Co., Inc. (together the `Underwriter") offers to enter into the following agreement
(this `Bond Purchase Agreement") with the Service Center Relocation, Incorporated (the
`Issuer") and the City of Fort Worth, Texas (the `City") which, upon the Issuer's and the City's
written acceptances of this offer will be binding upon the Issuer the City and the Underwriter
This offer is made subject to the Issuer's and the City's written acceptances hereof on or before
10.00 p.m., Fort Worth, Texas time, on November _ 2004 and, if not so accepted, will be
subject to withdrawal by the Underwriter upon notice delivered to the Issuer and the City at any
time prior to the acceptance hereof by the Issuer and the City Terms not otherwise defined
herein shall have the meanings set forth in the Resolution and the Indenture (as defined in
Paragraph 1(a) hereof) or in the Official Statement. The Underwriter has heretofore authorized
Oppenheimer & Co. (the `Representative") to execute this Bond Purchase Agreement on its
behalf.
1 Purchase and Sale of the Bonds. Subject to the terms and conditions and in
reliance upon the representations, warranties and agreements set forth herein, the Underwriter
hereby agrees to purchase from the Issuer and the Issuer hereby agrees to sell and deliver to the
Underwriter at Closing (as defined herein), all (but not less than all) of the Issuer's $23 425 000
Lease Revenue Bonds, Series 2004 (Service Center Project) (the `Bonds"). Inasmuch as this
purchase and sale represents a negotiated transaction, the Issuer understands, and hereby
confirms, that the Underwriter is not acting as a fiduciary of the Issuer but rather is acting solely
in its individual capacity as Underwriter for its own account. The Underwriter acknowledges
that the Bonds are secured by revenues that are subject to annual appropriation by the City
OPP480/75000
Dallas 877917 4.DOC
Council of the City and that there is no assurance that a future City Council will appropriate
moneys sufficient to enable the Issuer to pay debt service on the Bonds.
The principal amount of the Bonds to be issued, the dated date therefor the maturities,
interest rates per annum and yields are set forth in Schedule I hereto. The Bonds shall be as
described in, and shall be issued and secured under and pursuant to an ordinance to be adopted
by the City Council (the `Ordinance") on October 26, 2004 a resolution adopted by the Issuer's
Board of Directors (the `Resolution ') on October 26, 2004 a Lease with an Option to Purchase
Agreement dated as of October 1 2004 between the Issuer and the City (the `Lease") and an
Indenture of Trust dated as of October 1 2004 between the Issuer and Wells Fargo Bank,
National Association (the `Trustee") (the `Indenture"), authorizing the issuance of the Bonds
and containing other matters. The purchase price for the Bonds shall be $
(representing the par amount of the Bonds of $ less an original issue discount of
$ ,less an underwriting discount of $ ), less $ paid on behalf
of the Issuer to XL Capital Assurance Inc. ("XLCA') as the insurance premium for the
municipal bond insurance policy insuring the timely .payment of principal and interest on the
Bonds, plus accrued interest calculated on the basis of a 360-day year of twelve 30-day months,
from the dated date of the Bonds to the Closing. The payment to XLCA is being made by the
Underwriter as an accommodation to the Issuer
Delivered to the Issuer herewith as a good faith deposit is a check of the Representative
payable to the order of the Issuer in clearing house funds in the amount of $ In the
event you accept this offer such check shall be held uncashed by you until the time of Closing,
at which time such check shall be returned uncashed to the Representative. In the event that the.
Issuer does not accept this Bond Purchase Agreement, such check will be immediately returned
to the Representative. Should the Issuer fail to deliver the Bonds at the Closing, or should the
Issuer be unable to satisfy the conditions of the obligations of the Underwriter to purchase,
accept delivery of and pay for the Bonds, as set forth in this Agreement (unless waived by the
Underwriter), or should such obligations of the Underwriter be terminated for any reason
permitted by this Bond Purchase Agreement, such check shall immediately be returned to the
Representative. In the event that the Underwriter fails (other than for a reason permitted
hereunder) to purchase, accept delivery of and pay for the Bonds at the Closing as herein
provided, such check shall be cashed and the amount thereof retained by the Issuer as and for
fully liquidated damages for such failure of the Underwriter and, except as otherwise set forth
herein, no party shall have any further rights against the other hereunder The Underwriter
hereby agrees not to stop payment, or cause payment to be stopped, on such check unless the
Issuer has breached any of the terms of this Bond Purchase Agreement. The Underwriter and the
Issuer understand that in such event the Issuer's actual damages may be greater or may be less
than such amount. Accordingly the Underwriter hereby waives any right to claim that the
Issuer's actual damages are less than such amount, and the Issuer's acceptance of this offer shall
constitute a waiver of any right the Issuer may have to additional damages from the Underwriter
2. Public Offerins?. The Underwriter agrees to make a bona fide public offering of all
the Bonds at a price not to exceed the public offering price set forth on the inside cover of the
Official Statement, and may subsequently change such offering price without any requirement of
prior notice. The Underwriter may offer and sell the Bonds to certain dealers (including dealers
OPP480/75000
Dallas 877917 4.DOC
2
depositing Bonds into investment trusts) and others at prices lower than the public offering price
stated on the inside cover of the Official Statement.
3 Official Statement.
(a) The Preliminary Official Statement of the Issuer dated October _, 2004
including the cover page and Appendices thereto, relating to the Bonds (collectively the
`Preliminary Official Statement"), as amended to conform to the terms of this Bond Purchase
Agreement and with changes and amendments to the date hereof as have been mutually agreed to
by the Issuer and the Underwriter is referred to herein as the `Official Statement.
(b) The Preliminary Official Statement has been prepared for use in connection with
the public offering, sale and distribution of the Bonds by the Underwriter The Issuer hereby
represents and warrants that the Preliminary Official Statement delivered to the Underwriter
immediately prior to or concurrently herewith has been deemed final by the Issuer as of its date,
except for 'the omission of such information which is dependent upon the final pricing of the
Bonds for completion, all as permitted to be excluded by Rule 15c2 12 under the Securities
Exchange Act of 1934 as amended ("Rule 15c2 12"). Until the final Official Statement has been
prepared and is available for distribution, the Issuer shall provide to the Underwriter sufficient
quantities of the Preliminary Official Statement as the Underwriter deems necessary to satisfy
the obligations of the Underwriter under Rule 15c2 12 with respect to distribution to each
potential customer upon request, of a copy of the Preliminary Official Statement.
(c) As soon as practicable after the date hereof, and in any event within seven
business days after the acceptance of this Bond Purchase Agreement by the Issuer the Issuer
shall deliver or cause to be delivered to the Underwriter without charge, in sufficient time to
accompany any confirmation requesting payment from any customers of the Underwriter a
reasonable number of copies of the final Official Statement relating to the Bonds, which will be
determined by an officer duly authorized by the Issuer to be a final Official Statement for
purposes of Rule 15c2 12.
(d) The Issuer ratifies and confirms the use of the Preliminary Official Statement and
authorizes the Official Statement to be used in connection with the offering of the Bonds, and
ratifies and approves the prior distribution of the current drafts of each thereof by the
Underwriter prior to the availability of the final version thereof.
(e) If, after the date of this Bond Purchase Agreement to and including the date the
Underwriter is no longer required to provide an Official Statement to potential customers who
request the same pursuant to Rule 15c2 12 (the earlier of (i) 90 days from the `end of the
underwriting period" (as defined in Rule 15c2 12) and (ii) the time when the Official Statement
is available to any person from a nationally recognized municipal securities information
repository but in no case less than 25 days after the end of the underwriting period for the
Bonds), the Issuer becomes aware of any fact or event that might or would cause the Official
Statement, as then supplemented or amended, to contain any untrue statement of a material fact
or to omit to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances when the Official Statement is delivered to a
purchaser not misleading, or if it is necessary to amend or supplement the Official Statement to
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comply with law the Issuer will notify the Underwriter (and for the purposes of this clause
provide the Underwriter with such information as it may from time to time request), and if, in the
opinion of the Underwriter such fact or event requires preparation and publication of a
supplement or amendment to the Official Statement, the Issuer will forthwith prepare and
furnish, at the Issuer's own expense (in a form and manner approved by the Underwriter), a
reasonable number of copies of either amendments or supplements to the Official Statement so
that the statements in the Official Statement as so amended and supplemented will not, in light of
the circumstances when the Official Statement is delivered to a purchaser be misleading or so
that the Official Statement will comply with law If such notification shall be subsequent to the
Closing, the Issuer shall furnish such legal opinions, certificates, instruments and other
documents as the Underwriter may deem necessary to evidence the truth and accuracy of such
supplement or amendment to the Official Statement.
(~ The Underwriter hereby agrees to timely file the Official Statement with a
nationally recognized municipal securities information repository Unless otherwise notified in
writing by the Underwriter the Issuer can assume that the `end of the underwriting period" for
purposes of Rule 15c2 12 shall be the date of the Closing.
4 Representations and Warranties.
that:
(a) The Issuer hereby represents and warrants to and covenants with the Underwriter
(1) Existence; Power; and Authority The Issuer is anon-profit corporation
incorporated pursuant to the Subchapter D Chapter 431 Texas Transportation Code, and
the general laws of the State of Texas (the `Local Government Corporation Act"),
operating as such under the Texas Constitution and laws of the State of Texas and has full
legal right, power and authority and at the date of Closing will have the full legal right,
power and authority (i) to issue the Bonds, (ii) to authorize the preparation of the
Preliminary Official Statement and the Official Statement and to authorize their use and
distribution by the Underwriter (iii) to enter into this Bond Purchase Agreement and to
sell and deliver the Bonds to the Underwriter as provided herein, (iv) to adopt the
Resolution, and to execute and deliver the Lease, and the Indenture and to carry out and
consummate the actions contemplated thereby and (v) to carry out and consummate all
other transactions contemplated by each of the aforesaid documents, and the Issuer has
complied and will at the Closing be in compliance in all respects, with the terms of the
Local Government Corporation Act as it pertains to such transactions,
(2) Due Authorization. The Issuer's Board. of Directors has duly adopted the
Resolution, which by its terms approved and authorized the execution and delivery of the
Lease, the Indenture (which are unmodified from their date of adoption and are in full
force and effect at the time of the execution hereof), this Bond Purchase Agreement, the
Official Statement and the Bonds, and has authorized the taking of any and all such
actions as may be required on the part of the Issuer to carry out, give effect to and
consummate the transactions contemplated by this Bond Purchase Agreement, the
Official Statement and the Bonds;
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(3) No Adverse Actions. At the time of the Issuer's acceptance of this offer by
the execution hereof, there is, and at the date of the Closing there will be, no action, suit,
proceeding, inquiry or investigation, at law or in equity or before or by any court, public
board or body pending or known to be threatened against or affecting the existence of the
Issuer or the title of its officials to their respective positions, nor to the best of the
knowledge of the Issuer is there any basis therefor wherein an unfavorable decision,
ruling or finding would adversely affect the validity or enforceability of the Resolution,
the Lease, the Indenture, the Bonds, this Bond Purchase Agreement or any agreement or
instrument relating thereto, used or contemplated for use in the consummation of the
transactions contemplated by the Resolution, the Lease, the Indenture, this Bond
Purchase Agreement or the Official Statement;
(4) No Defaults. Except as may be disclosed in the Official Statement, the
Issuer is not, in any material respect which would adversely affect the validity or
marketability of the Bonds, in breach of or default under any applicable law or
administrative regulation of the State of Texas or any department, division, agency or
instrumentality thereof, or of the United States or any agency or instrumentality thereof
or any applicable judgment or decree or any loan agreement, note, resolution, certificate,
agreement or other instrument to which the Issuer is a party or is otherwise subject; and
the execution and delivery of the Official Statement, this Bond Purchase Agreement, the
Bonds, the Lease, and the Indenture, and compliance with the provisions of each thereof,
will not conflict with or constitute a material breach of or default under any applicable
law or administrative regulation of the State of Texas or any department, division, agency
or instrumentality thereof, or of the United States or any agency or instrumentality
thereof or any applicable judgment or decree or any loan agreement, note, resolution,
certificate, agreement or other instrument to which the Issuer is a party or is otherwise
subject;
(5) All Ap royals. All approvals, consents and orders of any governmental
authority board, agency or commission having jurisdiction which would constitute a
condition precedent to the performance by the Issuer of its obligations hereunder and
under the Resolution, the Indenture, the Lease, the Bonds and this Bond Purchase
Agreement will be obtained prior to Closing;
(6) Validity of the Bonds. The Bonds, this Bond Purchase Agreement, the
Indenture and the Lease conform to the descriptions thereof contained in the Official
Statement; and the Bonds, when issued, authenticated and delivered in accordance with
the Resolution and the Indenture, and sold to the Underwriter as provided in this Bond
Purchase Agreement, will be duly authorized, validly issued and outstanding obligations
of the Issuer secured in the manner and subject to the limitations provided in the
Resolution and the Indenture, and described in the Official Statement and entitled to the
benefits of the Resolution and the Indenture; subject to applicable bankruptcy
insolvency reorganization, moratorium and other laws affecting creditors' rights
generally and subject, as to enforceability to the general principles of equity (regardless
of whether enforcement is sought in a proceeding in equity or at law),
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(7) Accuracy of Information in Official Statement. At the time of the Issuer's
acceptance hereof and (unless the Official Statement is amended or supplemented
pursuant to subparagraph (a)(9) of this Paragraph 4) at all times subsequent thereto up to
and including the date of the Closing, the Official Statement (including the financial
statements and other financial and statistical data included therein) is and will be true and
correct in all material respects and does not and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they were
made, not misleading;
(8) Accuracy of Information in Official Statement After Amendment or
Supplement. If the Official Statement is amended or supplemented pursuant to
subparagraph (a)(9) of this Paragraph 4 at the time of each supplement or amendment
thereto and at all times subsequent thereto up to and including the date of the Closing, the
Official Statement, as so supplemented or amended (including the financial statements
and other financial and statistical data included therein), will not contain any untrue
statement of a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading;
(9) Amending or Supplementing Official Statement. If between the date of
this Bond Purchase Agreement and the 91st day following the date of the Closing an
event occurs of which the Issuer has knowledge and which would cause the Official
Statement to contain any untrue statement of a material fact or to omit to state any
material fact required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading, the Issuer
shall notify the Underwriter and if, in the reasonable judgment of the Issuer or the
Underwriter such event requires an amendment or supplement to the Official Statement,
the Issuer will, at its expense, amend and supplement the Official Statement in a form and
in a manner jointly approved by the Issuer and the Underwriter
(10) Prohibition Against Incurring Debt. Between the date of this Bond
Purchase Agreement and the delivery of the Bonds, the Issuer will not, without the prior
written consent of the Underwriter (which consent shall not be unreasonably withheld),
issue bonds, certificates, notes or other obligations for borrowed money which are or
would be payable from or constitute a charge on the revenues pledged to secure the
payment of the Bonds in the Indenture, and between the respective dates as of which
information is given in the Official Statement and the date of the delivery of the Bonds,
except as described in the Official Statement, the Issuer has not incurred and will not
incur any material long-term liabilities;
(11) Application of Proceeds. The Issuer will apply the proceeds of the Bonds
for the purposes, and in accordance with the description of the application of such
proceeds, set forth in the Official Statement;
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(12) Maintaining Tax Exemption of Interest on the Bonds. The Issuer will not
take or omit to take any action which will adversely affect the exclusion from income for
federal income tax purposes of the interest on the Bonds, and
(13) Amendment or Supplement of Documents. The Issuer will cooperate with
the Underwriter to amend or supplement the Indenture or the Lease as may be required
by any rating agency in connection with obtaining or maintaining a rating for the Bonds.
(b) The City represents and warrants to and agrees with the Underwriter (and it shall
be a condition of the obligation of the Underwriter to purchase and accept delivery of the Bonds
that the City shall so represent, warrant and agree as of the date of the Closing) that:
(1) Existence; Power; and Authority The City is a home rule municipality and
political subdivision of the State of Texas and a body politic and corporate and has full
legal right, power and authority (i) to enter into this Bond Purchase Agreement, (ii) to
adopt the Ordinance and to carry out and consummate the actions contemplated thereby
(iii) to enter into the Lease, and (iv) to carry out and consummate all other transactions
contemplated by each of the aforesaid documents,
(2) Due Authorization. The City Council has duly adopted the Ordinance
(which is unmodified from its date of adoption and is in full force and effect at the time
of the execution hereof) and has duly approved the execution and delivery of the Lease
and this Bond Purchase Agreement, and has authorized the taking of any and all such
actions as may be required on the part of the City to carry out, give effect to and
consummate the transactions contemplated by the Lease and this Bond Purchase
Agreement;
(3) No Adverse Actions. At the time of the City's acceptance of this offer by
the execution hereof, there is, and at the date of the Closing there will be, no action, suit,
proceeding, inquiry or investigation, at law or in equity or before or by any court, public
board or body pending or known to be threatened against or affecting the existence of the
City or the title of its officials to their respective positions, nor to the best of the
knowledge of the City is there any basis therefor wherein an unfavorable decision, ruling
or finding would adversely affect the validity or enforceability of the Ordinance, the
Lease, this Bond Purchase Agreement or any agreement or instrument relating thereto,
used or contemplated for use in the consummation of the transactions contemplated by
the Ordinance, the Lease or this Bond Purchase Agreement;
(4) No Defaults. Except as may be disclosed in the Official Statement, the
City is not, in any material respect which would adversely affect the validity or
marketability of the Bonds, in breach of or default under any applicable law or
administrative regulation of the State of Texas or any department, division, agency or
instrumentality thereof, or of the United States or any agency or instrumentality thereof
or any applicable judgment or decree or any loan agreement, note, resolution, certificate,
agreement or other instrument to which the City is a party or is otherwise subject; and the
execution and delivery of the Ordinance, the Lease and this Bond Purchase Agreement,
and compliance with the provisions of each thereof, will not conflict with or constitute a
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material breach of or default under any applicable law or administrative regulation of the
State of Texas or any department, division, agency or instrumentality thereof, or of the
united States or any .agency or instrumentality thereof or any applicable judgment or
decree or any loan agreement, note, resolution, certificate, agreement or other instrument
to which the City is a party or is otherwise subject;
(5) All Ap royals. All approvals, consents and orders of any governmental
authority board, agency or commission having jurisdiction which would constitute a
condition precedent to the performance by the City of its obligations hereunder and under
the Ordinance, the Lease and this Bond Purchase Agreement will be obtained prior to
Closing;
(6) Financial Statements. Excerpts from the financial statements of the City
contained in Appendix C to the Official Statement present fairly the financial position of
the City as of September 30, 2003 and the results of its operations for its fiscal year then
ended, and such statements have been prepared in accordance with the format described
therein,
(7) Maintaining Tax-Exemption of Interest on the Bonds. The City will not
take or omit to take any action which will adversely affect the exclusion from income for
federal income tax purposes of the interest on the Bonds, and
5 Delivery of, and Payment for, the Bonds. At or before 10.00 a.m., Fort Worth,
Texas time, on November 18, 2004 or on such other date as may be mutually agreed upon by the
Issuer and the Underwriter (the `Closing"), the Issuer will, subject to the terms and conditions
hereof, deliver the Bonds to the Underwriter duly executed and authenticated, together with the
other documents hereinafter mentioned, and the Underwriter subject to the terms and conditions
hereof, will accept such delivery and pay the purchase price of the Bonds as set forth in Section 1
in immediately available funds by wire transfer to the account of the Issuer as indicated by the
Trustee. Payment for the Bonds as aforesaid shall be made at the offices of Kelly Hart &
Hallman, 201 Main Street, Suite 2500, Fort Worth, Texas 76102, or such other place as shall
have been mutually agreed upon by the Issuer and Underwriter Concurrently with such
payment by the Underwriter the Issuer shall return to the Representative, the good faith check
referred to in Paragraph 1 hereof.
Delivery of the Bonds shall be made through the book-entry only system of The
Depository Trust Company New York, New York. The Bonds shall be delivered in definitive
fully registered form, bearing CUSIP numbers without coupons, with one Bond for each maturity
in the aggregate principal amount of such stated maturity registered in the name of Cede & Co.,
all as provided in the Indenture, and shall be made available to the Underwriter at least one
business day before the Closing for the purpose of inspection.
6 Survival of Representations and Warranties. Unless otherwise set forth herein, the
representations and agreements in this Bond Purchase Agreement shall remain operative and in
full force and effect regardless of any investigation made by or on behalf of the Underwriter and
shall survive the delivery of the Bonds hereunder
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7 Certain Conditions to Underwriter's Obli atg ions. T'he Underwriter has entered
into this Bond Purchase Agreement in reliance upon the representations, warranties and
agreements of the Issuer and the City contained herein, and in reliance upon the representations,
warranties and agreements to be contained in the documents and instruments to be delivered at
Closing and upon the performance by the Issuer and the City of their obligations hereunder both
as of the date hereof and as of the date of Closing. Accordingly the Underwriter's obligation
hereunder to purchase, accept delivery of and pay for the Bonds shall be conditioned upon the
performance by the Issuer and the City of their obligations hereunder and under such documents
and instruments at or prior to the Closing and shall also be subject to the following conditions,
any one or more of which may be waived by the Underwriter
(a) Continued Full Force and Effect of Documents. That at the time of the Closing,
the Resolution, the Ordinance, the Indenture, the Lease, the Official Statement and all related
actions of the Issuer and the City with respect to the issuance of the Bonds shall be in full force
and effect and shall not have been amended, modified or supplemented, except as may have been
agreed to by the Underwriter
(b) Termination of Bond Purchase Agreement by the Underwriter The Underwriter
shall have the right to cancel its obligation to purchase the Bonds if, between the date of this
Bond Purchase Agreement and the Closing, the market price or marketability of the Bonds shall
be materially adversely affected, in the reasonable judgment of the Underwriter (as evidenced by
a written notice to the Issuer terminating the obligation of the Underwriter to accept delivery of
and pay for the Bonds), by the occurrence of any of the following:
(1) legislation shall be enacted by or introduced in the Congress or
recommended to the Congress for passage by the President of the United States, or the
Treasury Department of the United States or the Internal Revenue Service or any member
of the Congress or favorably reported for passage to either House of the Congress by any
committee of such House to which such legislation has been referred for consideration, a
decision by a court of the United States or of the State or the United States Tax Court
shall be rendered, or an order ruling, regulation (final, temporary or proposed), press
release, statement or other form of notice by or on behalf of the Treasury Department of
the United States, the Internal Revenue Service or other governmental agency shall be
made or proposed, the effect of any or all of which would be to impose, directly or
indirectly federal income taxation upon interest received on obligations of the general
character of the Bonds or the interest on the Bonds as described in the Official Statement,
or other action or events shall have transpired which may have the purpose or effect,
directly or indirectly of changing the federal income tax consequences of any of the
transactions contemplated herein, or any other action or events shall have occurred
which, in the reasonable judgment of the Underwriter materially adversely affect the
market for the Bonds or the market price generally of obligations of the general character
of the Bonds;
(2) legislation introduced in or enacted (or resolution passed) by the Congress
or an order decree, or injunction issued by any court of competent jurisdiction, or an
order ruling, regulation (final, temporary or proposed), press release or other form of
notice issued or made by or on behalf of the Securities and Exchange Commission, or any
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other governmental agency having jurisdiction of the subject matter to the effect that
obligations of the general character of the Bonds, including any or all underlying
arrangements, are not exempt from registration under or other requirements of the 1933
Act, or that the Indenture is not exempt from qualification under or other requirements of
the Trust Indenture Act, or that the issuance, offering, or sale of obligations of the general
character of the Bonds, including any or all underlying arrangements, as contemplated
hereby or by the Official Statement or otherwise, is or would be in violation of the federal
securities laws as amended and then in effect;
(3) any state blue sky or securities commission or other governmental agency
or body shall have withheld registration, exemption or clearance of the offering of the
Bonds as described herein, or issued a stop order or similar ruling relating thereto,
(4) a general suspension of trading in securities on the New York Stock
Exchange or the American Stock Exchange, the establishment of minimum prices on
either such exchange, the establishment of material restrictions (not in force as of the date
hereof) upon trading securities generally by any governmental authority or any national
securities exchange, a general banking moratorium declared by federal, State of New
York, or State officials authorized to do so,
(5) any amendment to the federal or state Constitution or action by any federal
or state court, legislative body regulatory body or other authority materially adversely
affecting the tax status of the Issuer or the City its properly income, securities (or
interest thereon), or the validity or enforceability of the collection of revenues to pay
principal of and interest on the Bonds;
(6) any event occurring, or information becoming known which, in the
reasonable judgment of the Underwriter makes untrue in any material respect any
statement or information contained in the Official Statement, or has the effect that the
Official Statement contains any untrue statement of material fact or omits to state a
material fact required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
(7) there shall have occurred since the date of this Bond Purchase Agreement
any materially adverse change in the affairs or financial condition of the City•
(8) the United States shall have become engaged in hostilities which have
resulted in a declaration of war or a national emergency or there shall have occurred any
other outbreak or escalation of hostilities or a national or international calamity or crisis,
financial or otherwise, the effect of such outbreak, calamity or crisis on the financial
markets of the United States being such as, in the reasonable opinion of the Underwriter
would materially or adversely affect the ability of the Underwriter to market the Bonds;
(9) any fact or event shall exist or have existed that, in the Underwriter's
reasonable judgment, requires or has required an amendment of or supplement to the
Official Statement;
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(10) there shall have occurred any downgrading, or any notice shall have been
given of (A) any intended or potential downgrading or (B) any review or possible change
that does not indicate the direction of a possible change, in the rating accorded any of the
City's obligations (including the rating to be accorded the Bonds) by any `nationally
recognized statistical rating organization, as such term is defined for purposes of Rule
436(g)(2) under the 1933 Act; and
(11) the purchase of and payment for the Bonds by the Underwriter or the
resale of the Bonds by the Underwriter on the terms and conditions herein provided shall
be prohibited by any applicable law governmental authority board, agency or
commission,
(c) No Default in Payment of Debt Service. That neither the Issuer nor the City shall
have failed to pay principal of or interest on, when due, any of its outstanding, obligations for
borrowed money
(d) Agreement to Provide Continuing Disclosure of Information. That the City shall
have agreed, for so long as the City is the lessee of the Project, to provide certain periodic
information and notices of material events in accordance with the Securities and Exchange
Commission Rule 15c212 as described in the Preliminary Official Statement under
`CONTINUING DISCLOSURE OF INFORMATION The Underwriter has reviewed the
agreement set forth in the Lease, and the Underwriter's obligation to accept and pay for the
Bonds is conditioned upon delivery to the Underwriter of a certified copy of the Lease
containing the agreement described under such heading;
(e) Documents to be Received by the Underwriter That, at the Closing, the
Underwriter shall receive a copy of the transcript of proceedings relating to the authorization and
issuance of the Bonds, including each of the following documents:
(1) Transaction Documents. The Resolution, certified on behalf of the Issuer
the Ordinance certified on behalf of the City and executed counterparts of the Official
Statement, the Indenture and the Lease with such amendments, modifications or
supplements thereto as may have been agreed to by the Underwriter
(2) Bond Counsel Opinion. An approving opinion, dated the date of Closing,
of Co-Bond Counsel, McCall, Parkhurst & Horton L.L.P Dallas, Texas and Kelly
Hart & Hallman, A Professional Corporation, Fort Worth, Texas ("Bond Counsel") in
substantially the form set forth in Appendix D to the Official Statement;
(3) City Attorney Opinion. An opinion of the City Attorney dated the date of
Closing, addressed to the Issuer Underwriter and the Trustee, to the effect that (i) the
City is organized and existing pursuant to the Constitution and laws of the State of Texas
with full authority to authorize the creation of the Issuer under the Local Government
Corporation Act; (ii) the City has the requisite right, power and authority to (1) execute
and deliver the Lease and (2) perform its obligations under and carry out and
consummate all other transactions described in the Lease; (iii) the Lease has been duly
authorized, executed and delivered by the City and constitutes a legal, valid and binding
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obligation of the City enforceable in accordance with its terms; (iv) the execution and
delivery by the City of the Lease do not and each of its obligations under such document
may be complied with in a manner which will not, conflict with, or constitute a violation
of, any of the provisions of the Constitution or laws of the State of Texas, (v) there is no
authorization, approval or consent of the City in connection with its execution, delivery
and performance of its obligations under the Lease required by any federal, state or other
governmental regulatory agency having jurisdiction in .the premises, other than the
approval of the Attorney General of the State of Texas, which has been obtained, (vi)
except as disclosed in the Official Statement, no litigation is pending, or to such
counsel s knowledge, threatened, in any court (1) seeking to restrain or enjoin the
issuance or delivery of the Bonds or the execution and delivery of the Lease, or in any
way contesting or affecting the validity or enforcement of the Bonds or the Lease, or
contesting the powers of the City or any authority for the issuance of the Bonds or the
execution and delivery of the Lease, or (2) except as disclosed in the Official Statement,
in which a final adverse decision would materially adversely affect the financial
condition of the City or (3) contesting in any way the completeness, accuracy or fairness
of the Official Statement; and (vii) the statements in the Official Statement under the
captions `RISK FACTORS, `THE PROJECT `THE CITY" AND `LITIGATION"
fairly and accurately summarize in all material respects the matters described therein,
(4) Issuer's Opinion. An opinion of counsel to the Issuer dated the date of
Closing, addressed to the City the Underwriter and the Trustee, to .the effect that (i) the
Issuer has the requisite right, power and authority to (1) adopt the Resolution and to
execute and deliver the Lease, the Indenture (together with -the Resolution, the `Issuer
Documents") and (2) perform its obligations under and carry out and consummate all
other transactions described in the Issuer Documents; (iii) the Issuer Documents have
been duly authorized, executed and delivered by the Issuer and constitute legal, valid and
binding obligations of the Issuer enforceable in accordance with their terms, (iv) the
execution and delivery by the Issuer of the Issuer Documents do not and each of its
obligations under such documents may be complied with in a manner that will not,
conflict with, or constitute a violation of, any of the provisions of the Constitution or laws
of the State of Texas; (v) there is no authorization, approval or consent of the Issuer in
connection with its execution, delivery and performance of its obligations under the
Issuer Documents required by any federal, state or other governmental regulatory agency
having jurisdiction in the premises, other than the approval of the Attorney General of the
State of Texas, which has been obtained, (vi) except as disclosed in the Official
Statement, no litigation is pending, or to such counsel s knowledge, threatened, in any
court (1) seeking to restrain or enjoin the issuance or delivery of the Bonds or the
execution and delivery of the Issuer Documents, or in any way contesting or affecting the
validity or enforcement of the Bonds or the Issuer Documents, or contesting the powers
of the Issuer or any authority for the issuance of the Bonds or the execution and delivery
of the Issuer Documents, or (2) except as disclosed in the Official Statement, in which a
final adverse decision would materially adversely affect the financial condition of the
Issuer or (3) contesting in any way the completeness, accuracy or fairness of the Official
Statement; and (vii) the statements in the Official Statement under the captions `RISK
FACTORS, `THE PROJECT `THE CORPORATION" AND `LITIGATION" fairly
and accurately summarize in all material respects the matters described therein,
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(5) Bond Counsel s Supplemental Opinion. A supplemental opinion of Bond
Counsel, addressed to the Issuer the City and the Underwriter and dated the date of
Closing, to the effect that the offering and sale of the Bonds are not required to be
registered under the Securities Act of 1933 as amended, the Indenture is not required to
be qualified under the Indenture Act of 1939 as amended, and further that the Issuer's
Bond Counsel has reviewed the information appearing in the Official Statement under the
captions `INTRODUCTION `PLAN OF FINANCING, `THE BONDS" (other than
the subsection entitled `Book-Entry-Only System"), `SECURITY FOR THE BONDS,
`RISK FACTORS Constitutionality of the Lease Obligation, `THE
CORPORATION `TAX MATTERS, `LEGAL MATTERS, `CONTINUING
DISCLOSURE OF INFORMATION" (other than the section entitled `Compliance with
Prior Undertakings"), `REGISTRATION AND QUALIFICATION OF BONDS FOR
SALE, `THE BONDS AS LEGAL INVESTMENTS IN TEXAS" and APPENDIX A,
solely to determine whether the information relating to the Bonds, the Resolution, the
Indenture and the Lease contained under such captions fairly and accurately summarizes
the provisions of the documents referred to therein and is correct as to matters of law•
such opinion also shall contain a provision to the effect that the opinion referred to in
subparagraph (2) above may be relied upon by the Underwriter to the same extent as if
such opinion were addressed to them,
(6) Certificate as to Tax Exemption. A certificate signed by the an authorized
official of the Issuer that (i) sets forth facts, estimates and circumstances in existence on
the date of the Closing, which facts, estimates and circumstances shall be sufficiently set
forth therein to support the conclusion that it is not expected that the proceeds of the
Bonds will be used in a manner or that the Issuer will take any action or omit to take any
action that would cause the Bonds to be `arbitrage bonds, within the meaning of the
Internal Revenue Code of 1986, as amended (the `Code"), and the regulations, temporary
regulations and proposed regulations promulgated under the Code, and (ii) states that to
the best of the knowledge and belief of such official there are no other facts, estimates or
circumstances that would materially affect such expectations,
(7) Counsel to the Underwriter's Opinion. An opinion, dated the date of the
Closing and addressed to the Underwriter of Vinson & Elkins L.L.P Dallas, Texas
("Counsel to the Underwriter"), to the effect that the offer and sale of the Bonds are not
required to be registered under the Securities Act of 1933 as amended, and that the
.Indenture is not required to be qualified under the Indenture Act of 1939 as amended. In
addition, such firm shall state that without having undertaken to determine independently
the accuracy or completeness of the statements contained in the Official Statement, based
upon such counsel s participation in the preparation of the Official Statement, nothing
has come to such counsel s attention which gives such counsel reason to believe that the
Official Statement as of the date of the Bond Purchase Agreement and as of the date of
the Closing (except for financial statements and other financial and statistical data as to
which no view need be expressed) contained or contains any untrue statement of a
material fact or omitted or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading;
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(8) Issuer's Closing Certificate. A certificate, dated as of the Closing Date
from the Issuer executed by the President of the Board of Directors or other duly
authorized official of the Issuer acting in his or her official capacity to the effect that (i)
the representations, warranties and covenants of the Issuer contained herein are true and
correct in all material respects on and as of the date of the delivery of the Bonds, with the
same effect as if made on the date of the delivery of the Bonds by the Issuer (ii) except
as described in the Official Statement, no litigation is pending or to the best of such
official s knowledge and belief, threatened in any court in any way affecting the
existence of the Issuer or the titles of its officials to their respective positions, or seeking
to restrain or to enjoin the issuance, sale or delivery of the Bonds, or the application of
revenues and assets of the Issuer or in any way contesting or affecting the validity or
enforceability of the Bonds, the Resolution, the Indenture, the Lease or the Bond
Purchase Agreement, or contesting in any way the completeness or accuracy of the
Preliminary Official Statement or the Official Statement, or contesting the powers of the
Issuer or its authority with respect to the Bonds, the Resolution, the Indenture, the Lease
or the Bond Purchase Agreement; (iii) as of the date of the Closing, the Official
Statement (excluding the appendices thereto, except Appendix A) of the Issuer does not
contain any untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; (iv) no event affecting the
Issuer has occurred since the date of the Official Statement to the date of the Closing
which should be disclosed in the Official Statement for the purposes for which it is to be
used or which it is necessary to disclose therein in order to make the statements and
information therein not misleading in any material respect; (v) the Resolution, the
Indenture, the Lease, and the Bond Purchase Agreement are valid, legal and binding
obligations of the Issuer and have not been amended, modified, supplemented or
repealed, except as contemplated by this Bond -Purchase Agreement or as may have been
agreed to by Underwriter and are in full force and effect; and (vi) the Issuer has
complied in all material respects with all the agreements and satisfied all material
conditions on its part to be performed or satisfied at or prior to the delivery of the Bonds;
(9) City's Closing Certificate. A certificate, dated as of the date of Closing
from the City executed by the appropriate officials of the City to the effect that (i) the
representations, warranties and covenants of the City contained herein are true and
correct in all material respects on and as of the date of the delivery of the Bonds, with the
same effect as if made on the date of the delivery of the Bonds, (ii) except as described in
the Official Statement, no litigation is pending, or to the best of such official s knowledge
and belief, threatened in any court in any way affecting the existence of the City or the
titles of its officials to their respective positions, or seeking to restrain or to enjoin the
application of revenues by the City or in any way contesting or affecting the validity or
enforceability of the Lease or the Bond Purchase Agreement, or contesting in any way
the completeness or accuracy of the information regarding the City contained in the
Preliminary Official Statement or the Official Statement, or contesting the powers of the
City or its authority with respect to the Lease or the Bond Purchase Agreement; (iii) the
Lease and the Bond Purchase Agreement are valid, legal and binding obligations of the
City and have not been amended, modified, supplemented, or repealed, except as may
have been agreed to by the Underwriter and are in full force and effect; and (iv) there has
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been no material adverse change in the financial condition of the City from the annual
financial report included in Appendix C to the Official Statement.
(10) Attorney Generals Opinion. The approving opinion of the Attorney
General in respect of the Bonds,
(11) Comptroller's Registration Certificate. The registration certificate of the
Comptroller in respect of the Bonds,
(12) Real Estate Documents. Copies of the survey appraisal, Title Insurance
Commitments, Environmental Assessments and remediation plans and insurance
certificates;
(13) Bond Insurance. The municipal bond insurance policy issued by XLCA
with respect to the Bonds, together with the customary opinion of its legal counsel as to
the validity and enforceability of such policies and the fairness and accuracy of the
language in the Official Statement describing XLCA and such policies,
(14) Ratin Letters. Evidence of the rating of Moody's Investor Services, Inc.,
Standard & Poor's Ratings Services and Fitch of Aaa, AAA and AAA respectively
on the Bonds, in a form acceptable to the Underwriter and
(15) Additional Certificates. Instruments and Opinions. Such additional
certificates, instruments or opinions as Bond Counsel or Counsel to the Underwriter may
reasonably deem necessary or desirable.
(f) Performance of Obligations. That the Issuer and the City shall perform or have
performed in all material respects at or prior to the Closing all of the Issuer's and the City's
obligations, respectively required under or specified in this Bond Purchase Agreement to be
performed at or prior to the Closing.
All certificates, instruments, opinions and documents referred to above shall be in form
and substance reasonably satisfactory to Bond Counsel and Counsel to the Underwriter
If the Issuer or the City should be unable to satisfy the conditions to the obligation of the
Underwriter to pay for the Bonds contained in this Bond Purchase Agreement or if the
obligations of the Underwriter shall be terminated for any reason permitted hereby neither the
Underwriter the Issuer nor the City shall be under further obligation hereunder
8. Receipt For Bonds. At the Closing, contemporaneously with the receipt of the
Bonds by the Underwriter the Underwriter will deliver to the Issuer a receipt therefor in form
satisfactory to Bond Counsel, signed by the Underwriter
9 Reproduction of Bond Counsel s Opinion on the Bonds. The opinion of Bond
Counsel as described in Paragraph 7(e)(2) may be reproduced on the Bonds.
10 Payment of Expenses. The Underwriter shall have no obligation to pay and the
Issuer shall pay any expenses incident to the performance of the Issuer's obligations hereunder
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including, but not limited to: (a) the cost of the preparation and printing of the Bonds, if any• (b)
the fees, if any for bond ratings; (c) the fees and disbursements of Bond Counsel, the Financial
Advisor and of any other attorneys, engineers, accountants and other experts, consultants or
advisors retained by the Issuer (d) the costs of preparing, printing and mailing the Preliminary
Official Statement and the Official Statement; (e) any legally required publication expenses; (f)
the cost of any premium for any municipal bond insurance policy (g) the out-of-pocket
expenses, including the cost of travel, of any officials of the Issuer and (h) any other expenses
mutually agreed to by the Issuer and the Underwriter to be reasonably considered expenses of the
Issuer which are incident to the transactions contemplated hereby The Underwriter shall pay (i)
the cost of preparation and printing of this Bond Purchase Agreement; (ii) all advertising
expenses in connection with the public offering of the Bonds, and (iii) all other expenses
incurred by them in connection with the public offering of the Bonds, including the fees and
disbursements of counsel retained by the Underwriter
11 Notices. Any notice or other communication to be given to the Issuer under this
Bond Purchase Agreement may be given by delivering the same in writing to the Issuer at the
address indicated above, Attention. President (with copies to the City), and any such notice to be
given to the Underwriter may be given by delivering the same in writing to Oppenheimer & Co.,
4717 Grand Ave., #800, Kansas City MO 64112, Attention. Jack Holland.
12. Parties in Interest. This Bond Purchase Agreement as heretofore specified shall
constitute the entire agreement between us and is made solely for the benefit of the Issuer the
City and the Underwriter (including successors or assigns of the Underwriter) and no other
person shall acquire or have any right hereunder or by virtue hereof. This Bond Purchase
Agreement may not be assigned by the Issuer or the City All of the Issuer's and City's
representations, warranties and agreements contained in this Bond Purchase Agreement shall
remain operative and in full force and effect, regardless of (i) any investigations made by or on
behalf of the Underwriter (ii) delivery of and payment for the Bonds pursuant to this Bond
Purchase Agreement; and (iii) any termination of this Bond Purchase Agreement.
13 Effectiveness. This Bond Purchase Agreement shall become effective upon the
acceptance hereof by the Issuer and the City and shall be valid and enforceable at the time of
such acceptance.
14 Governing_Law THIS BOND PURCHASE AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF TEXAS
15 Severability If any provision of this Bond Purchase Agreement shall be held or
deemed to be or shall, in fact, be invalid, inoperative or unenforceable as applied in any
particular case in any jurisdiction or jurisdictions, or in all jurisdictions because it conflicts with
any provision of any Constitution, statute, rule of public policy or any other reason, such
circumstances shall not have the effect of rendering the provision in question invalid, inoperative
or unenforceable in any other case or circumstance, or of rendering any other provision or
provisions of this Bond Purchase Agreement invalid, inoperative or unenforceable to any extent
whatever
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16. Business Dav For purposes of this Bond Purchase Agreement, `business day"
means any day on which the New York Stock Exchange is open for trading.
17 Section Headings. Section headings have been inserted in this Bond Purchase
Agreement as a matter of convenience of reference only and it is agreed that such section
headings are not a part of this Bond Purchase Agreement and will not be used in the
interpretation of any provisions of this Bond Purchase Agreement.
18. Counterparts. This Bond Purchase Agreement may be executed in several
counterparts each of which shall be regarded as an original (with the same effect as if the
signatures thereto and hereto were upon the same document) and all of which shall constitute one
and the same document.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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If you agree with the foregoing, please sign the enclosed counterpart of this Bond
Purchase Agreement and return it to the Underwriter This Bond Purchase Agreement shall
become a binding agreement between you and the Underwriter when at least the counterpart of
this letter shall have been signed by or on behalf of each of the parties hereto
Respectfully submitted,
OPPENHEIMER & CO
RBC DAIN RAUSCHER 1NC
SAMUEL A. RAMIREZ & CO INC.
By OPPENHEIMER & CO
as Representative
By
Title: Managing Director
APPROVED AND ACCEPTED AS
OF THE DATE HEREOF
SERVICE CENTER RELOCATION INCORPORATED
By
President, Board of Directors
Attest:
Secretary Board of Directors
CITY OF FORT WORTH, TEXAS
By•
Interim City Manager
Attest:
City Secretary
Schedule I Maturity Schedule
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SCHEDULEI
$23 425,000
LEASE REVENUE BONDS, SERIES 2004
(SERVICE CENTER PROJECT),
BOND PURCHASE AGREEMENT
Interest Accrues from. November 1 2004
$ Serial Bonds
Princi al Maturity
Amount(a~(b)(oxd> (February 5) Interest Rate Price or Yield
$ _% Term Bonds, due March 12034 Yield %(e)
ca) The Bonds are ubject to optional redemption whole, but of part, upon the rcise by the City of its
option to purchase the project pursuant to the Lease, on March 1 2014 or any September 1 or March 1
thereafter at the par alue thereof plus ccrued nterest to the edemption date.
cb) The Bonds subject to mandatory edemption and prepayment whole, but not in part, at price of par
plus accrued nterest to the date of edemption upon the ise by the City of its option to purchase upon
a casualty loss condemnation of the Project
~°~ The Bonds are subject to mandatory partial redemption, prior to their maturities, the inverse
chronological rder of their cheduled maturities, at a edemption price equal to the principal amount
thereof, plus trued interest to the date fixed for redemption, with and to the extent money the Project
Fund xceeds $100,000 on the rliest of (i) the xt Interest Payment Date for which notice of redemption
be given nder the Indenture following November 1 2007 (ii) ipt by the Trustee of Final
Acceptance Certificate as required by the Lease Agreement upon completion of the Project.
(a~ The Bonds maturing and after March 1 2015 are ubject to optional redemption, whole or part, and
if part principal amounts of $5,000 or ny ntegral multiple thereof, on March 1 2014 or
any date thereafter at the par alue thereof plus creed nterest to the redemption date.
(e) The Bonds are ubject to mandatory redemption In part by lot the following years
nd the following amounts, at a price equal to the principal amount thereof and accrued and npaid
nterest to the date of edemption, without premium:
Year Principal Amount Year Principal Amount
*Final Maturity
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Schedule I 1