HomeMy WebLinkAboutRES 82-444 RESOLUTION OF THE CITY COUNCIL
APPROVING THE ISSUANCE OF
INDUSTRIAL DEVELOPMENT REVENUE BONDS BY THE
BEAUMONT INDUSTRIAL DEVELOPMENT CORPORATION
TO FINANCE A PROJECT FOR
700 CALDER, INCORPORATED
WHEREAS , by ordinance the City Council (the "Governing
Body") of the City of Beaumont, Texas (the "Unit") , authori-
zed and approved the creation of the Beaumont Industrial
Development Corporation (the "Corporation") as a nonstock,
nonprofit industrial development corporaion under the
provisions of the Development Corporation Act of 1979 , as
amended, Article 5190 . 6 , Vernon' s Annotated Texas Civil
Statutes (the "Act") ; and
WHEREAS, by Resolution adopted on November 16 , 1982 ,
the Governing Body approved a resolution authorizing the
issuance of industrial development revenue bonds by the
Corporation to finance the cost of facilities (the
"Project") for 700 Calder, Incorporated (the "User") , which
Project was described in said Resolution; and
WHEREAS , the Governing Body found and determined in
said Resolution, and now hereby confirms such findings and
determinations , that the issuance of the Bonds (as herein-
after defined) to finance the Project will accomplish the
specific public purpose for which the Corporation was
created; and
WHEREAS, in accordance with the terms of such Resolu-
tion, the Corporation now desires to sell and provide for
the issuance and sale of its $2 , 650 , 000 Industrial Develop-
ment Revenue Bonds , Series 1982 (700 Calder, Incorporated
Project) (the "Bonds") , by adopting a Resolution substan-
tially in the form attached hereto as Exhibit "A" (the "Bond
Resolution") ; and
WHEREAS, the Act provides that the Governing Body must ,
by written resolution adopted no more than sixty (60) days
prior to the date of the delivery of the Bonds , specifically
approve the resolution of the Corporation providing for the
issuance of the Bonds ;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
THE CITY OF BEAUMONT, TEXAS , THAT:
Section 1 . The proposed Bond Resolution providing
for the sale and issuance of the Bonds , substantially in the
form attached hereto as Exhibit "A" , is hereby specifically
approved.
Section 2 . The Governing Body hereby finds and
determines at the issuance of the Bonds to finance the
Project will accomplish the specific public purpose for
which the Corporation was created.
Section 3 . The Governing Body has considered
evidence of the posting of notice of this meeting and
officially finds , determines , recites and declares that a
sufficient written notice of the date , hour and place of
this meeting and of the subject of this Resolution was
posted on a bulletin board at a place convenient to the
public in the City. Hall of the Unit for at least 72 hours
preceding the convening of such meeting; such place of
posting was readily accessible to the general public at all
times from such time of posting until the convening of such
meeting; and such meeting was open to the public as required
by law at all times during which the Resolution and the
subject matter thereof were discussed, considered and
formally acted upon, all as required by the Open Meetings
Law, Article 6252-17 , Vernon' s Annotated Texas Civil
Statutes , as amended.
ADOPTED this day of .Novrember, 1982 .
�I JAJV4.-,,q iA6C_�
Ma o , City of Be nt, Texas
G �/ -2-
a
RESOLUTION AUTHORIZING THE ISSUANCE OF BEAUMONT
INDUSTRIAL DEVELOPMENT CORPORATION $2 , 650 , 000
INDUSTRIAL DEVELOPMENT REVENUE BONDS ,
SERIES 1982 (700 CALDER, INCORPORATED PROJECT) ,
AND THE EXECUTION OF A TRUST INDENTURE
AND OTHER RELATED DOCUMENTS
WHEREAS , Beaumont Industrial Development Corporation
(the "Corporation") is a nonstock, nonprofit industrial
development corporation organized and existing under the
laws of the State of Texas , including particularly the
Development Corporation Act of 1979 , as amended, Art.
5190 . 6 , Vernon' s Annotated Texas Civil Statutes (the "Act") ;
and
WHEREAS , the Corporation is a duly constituted public
instrumentality of the City of Beaumont , Texas (the "Unit") ,
a political subdivision of the State of Texas , within the
meaning of the regulations of the United States Treasury
Department (the "Regulations") and the rulings under the
Internal Revenue Code of 1954 , as amended (the "Code") , and
the Corporation is functioning and acting solely on behalf
of the Unit; and
WHEREAS , the Board of Directors of the Corporation (the
"Board") adopted a resolution on August 12 , 1982 (the
"Inducement Resolution") , pursuant to which a certain
Agreement to Issue Bonds between the Corporation and
700 Calder, Incorporated, a Texas corporation (the "User") ,
was executed and delivered, whereby in accordance with the
provisions of the Act , the Corporation agreed to provide for
the financing of the cost of the User' s project (the
"Project") which was initially described in Exhibit "A" to
the Agreement to Issue Bonds and which is more fully
described in the Loan Agreement between the Corporation and
the User; and
WHEREAS, for purposes of financing the cost of the
Project , the Corporation now desires (i) to authorize the
issuance of its Industrial Development Revenue Bonds ,
Series 1982 (700 Calder, Incorporated Project) (the
"Bonds") , in the maximum aggregate principal amount of
$2 , 650 , 000 , pursuant to the terms and provisions of a trust
indenture, (ii) to provide for the sale of the Bonds to the
purchaser described herein, (iii) to provide for the payment
of the principal of and premium, if any, and interest on the
Bonds with revenues derived from the loan of proceeds of the
EXHIBIT "A"
sale of the Bonds (except for any amount representing
accrued interest on the Bonds) to the User to finance the
cost of the Project pursuant to the terms and provisions of
a loan agreement and (iv) to take and authorize certain
other actions in connection with the foregoing; and
WHEREAS , on November 16 , 1982 , the governing body of
the Unit adopted a written resolution specifically approving
the Project , the Inducement Resolution and the Agreement to
Issue Bonds , and on November 23 , 1982 , the governing body of
the Unit adopted a written resolution specifically approving
this resolution of the Corporation providing for the
issuance of the Bonds ; and
WHEREAS, the Board has examined proposed forms of a
trust indenture , a loan agreement , a collateral assignment
and security agreement, a letter of representation and an
investment letter, all comprising a part of this resolution,
and the Board finds that the form and substance of such
documents are satisfactory and the recitals and findings
contained therein are true , correct and complete and hereby
adopts and incorporates by reference such recitals and
findings as if set forth in full in this resolution, and
finds that it is in the best interest of the public and the
Corporation and will assist in carrying out the public
purpose of the Corporation and the Act to authorize the
execution and delivery of such documents ; and
WHEREAS , the Board has examined the proposed form of a
deed of trust and security agreement from the User to Bruce
H. Whitehead, as mortgage trustee , for the benefit of the
Corporation, and the Board finds the form and substance of
such document is satisfactory;
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF
DIRECTORS OF BEAUMONT INDUSTRIAL DEVELOPMENT CORPORATION,
THAT:
Section 1. APPROVAL OF TRANSACTION.
(a) Approval of the Bonds . The Corporation hereby
authorizes and irects the issuance of the Bonds in the
maximum aggregate principal amount of $2 ,650 , 000 , in
accordance with a trust indenture substantially in the form
of the Trust Indenture , dated as of December 1, 1982 (the
"Trust Indenture") , by and between the Corporation and
Allied Merchants Bank of Port Arthur, Texas , as trustee (the
"Trustee") , attached to this resolution as Exhibit A, the
form, terms and provisions of such Indenture and the Bonds
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S
being hereby authorized and approved, and the President and
any Vice President of the Corporation are hereby severally
authorized and directed to execute and deliver such
Indenture and the Bonds on behalf of the Corporation, and
the Secretary of the Corporation is hereby authorized to
attest and affix the Corporation' s seal thereto, with such
changes therein as the officers executing the same may
approve, such approval to be conclusively evidenced by such
execution thereof.
(b) A royal of the Agreement. The loan of the
proceeds of the sale of the Bonds (except for any amount
representing accrued interest on the Bonds) by the Corpora-
tion to the User in order to provide financing for the costs
of acquiring and constructing the Project shall be effected
pursuant to the terms and provisions of a loan agreement
substantially in the form of the Loan Agreement dated as of
December 1 , 1982 (the "Agreement") , by and between the
Corporation and the User, attached to this resolution as
Exhibit B, the form, terms and provisions of the Agreement
being hereby authorized and approved, and the President and
any Vice President of the Corporation are hereby severally
authorized and directed to execute and deliver the Agreement
on behalf of the Corporation, and the Secretary of the
Corporation is hereby authorized to attest and affix the
Corporation' s seal thereto , with such changes therein as the
officers executing the same may approve , such approval to be
conclusively evidenced by such execution thereof.
(c) Requirement as to Deed of Trust and Collateral
Assignment. As a condition to the actions aut orized in
the Section, the User shall have executed a deed of trust
and security agreement substantially in the form of the Deed
of Trust and Security Agreement dated as of December 1 , 1982
(the "Deed of Trust") , from the User to Bruce H. Whitehead,
as mortgage trustee , for the benefit of the Corporation,
attached to this resolution as Exhibit C , the form, terms
and provisions thereof being hereby authorized and approved.
The assignment of the Corporation' s rights under the
Deed of Trust and the Note (as defined therein) to the
Trustee for the benefit of the holders of the Bonds , shall
be effected pursuant to the terms and provisions of a
collateral assignment and security agreement substantially
in the form of the Collateral Assignment and Security
Agreement dated as of December 1 , 1982 (the "Collateral
Assignment") , from the Corporation to the Trustee , and
attached to this Resolution as Exhibit D, the form, terms
and provisions of the Collateral Assignment being hereby
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a
authorized and approved, and the President and any Vice
President of the Corporation are hereby severally authorized
and directed to execute and deliver the Collateral
Assignment on behalf of the Corporation, and the Secretary
is hereby authorized to attest and affix the Corporation' s
seal thereto , with such changes therein as the officers
executing the same may approve , such approval to be
conclusively evidenced by such execution thereof.
(d) Conditions Precedent to Closing of the Transaction.
The actions and obligations authorized in this Section shall
be subject to and conditioned upon the receipt by the
Corporation at the Closing Date (as hereinafter defined) of
(i) a letter of representation from the User , duly
authorized and executed by the User, substantially in the
form of the Letter of Representation, dated the Closing Date
(the "Letter of Representation") and attached to this
resolution as Exhibit E, the form, terms and provisions of
the Letter of Representation being hereby authorized and
approved and the President and any Vice President of the
Corporation are hereby severally authorized to signify the
Corporation' s acceptance and confirmation of such Letter of
Representation by executing the same on behalf of the
Corporation in multiple counterparts ; (ii) an investment
letter, duly authorized and executed by the Purchaser (as
hereinafter defined) , substantially in the form of the
Investment Letter, dated the Closing Date (the "Investment
Letter") and attached to this resolution as Exhibit F, the
form, terms and provisions of such Investment Letter being
hereby authorized and approved; (iii) a certificate from a
representative of the Texas Industrial Commission (the
"Commission") , acting on behalf of the Commission,
evidencing final approval of the Loan Agreement; (iv) the
purchase price for the Bonds ; and (v) such opinions ,
evidences , certificates , instruments or other documents as
shall be requested by the Corporation' s Counsel or by Bond
Counsel , to evidence due performance or satisfaction by the
User at or prior to such time of all agreements then to be
performed and all conditions then to be satisfied by it.
(e) Approval of Sale of the Bonds . The sale and
delivery of the Bonds by t e Corporation to Allied Bank
Beaumont (the "Purchaser") , at the par value thereof plus
accrued interest from the date of the Bonds until the date
of delivery and payment for the Bonds (the "Closing Date") ,
is hereby authorized and approved. At the closing of such
sale , the Corporation agrees to pay the Purchaser as a
commitment fee therefor an amount in cash equal to 12% of
the total face amount of the Bonds which are then delivered.
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(f) Incorporation by Reference. All of the terms and
provisions of the documents attached as Exhibits A through F
to this resolution shall be and the same are hereby made a
part of this resolution.
(g) Additional Authorizations to Officers of the Corpo-
ration. The officers , employees and agents of the
Corporation, and each of them, shall be and each is
expressly authorized, empowered and directed from time to
time and at any time to do and perform all acts and things
and to execute , acknowledge and deliver in the name and
under the corporate seal and on behalf of the Corporation
all certificates , financing statements , instruments and
other papers , whether or not herein mentioned, as they may
determine to be necessary or desirable in order to carry out
the terms and provisions of this resolution and of the Bonds
to be issued hereunder, as well as the terms and provisions
of the Agreement , the Trust Indenture, the Deed of Trust ,
the Letter of Representation and the Collateral Assignment
hereby authorized and approved, such determination to be
conclusively evidenced by the performance of such acts and
things and the execution of any such certificate, financing
statement , instrument or other paper.
(h) Filing of Transcript. The officers of the
Corporation (with the assistance of the User) shall prepare
a final transcript of the proceedings relating to the
authorization, issuance , sale and delivery of the Bonds ,
which transcript shall be submitted to the Commission within
thirty (30) days after the Closing Date.
(i) Election Under the Code. The Corporation hereby
elects to --Ea- e Section 103 (E-)—(6–) (D) of the Code and the
Regulations promulgated thereunder apply to the Bonds , and
the President and the Secretary of the Corporation are
hereby severally authorized and directed to execute and
deliver a statement to the Internal Revenue Service to the
effect that the Corporation has so elected, and to deliver a
copy of such statement to the Purchaser and the User.
(j ) Effective Date of the Bond Resolution. This
resolution shall take effect and be in u 1 orce and effect
upon and after its passage.
(k) Defined Terms . Unless otherwise indicated, all
capitalize terms used herein shall have the meanings set
forth in (i) this resolution and (ii) the documents which
are incorporated herein pursuant to (f) above. This
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resolution is sometimes herein referred to as the "Bond
Resolution" .
Section 2 . DATE, DENOMINATION, NUMBERS , AND MATURITIES
OF THE BONDS. The Bon s initially authorized hereby shall
e dated December 1 , 1982 , shall be issued and delivered in
the form of a fully registered bond, without coupons ,
payable in installments to the registered owner thereof, or
its registered assigns , all in the manner hereinafter
provided, with the Bond to be numbered R-001 in the
denomination and principal amount of $2 , 650 ,000 . 00 , being
initially payable to Allied Bank Beaumont in annual
installments on the dates and in the amounts as set forth in
Section 5 hereof.
Section 3 . INTEREST ON THE BONDS. The Bonds initially
authorized hereby shall bear interest on the unpaid balance
of the principal amount thereof from the date of delivery to
the initial purchaser thereof (which date shall be indicated
by the Trustee in the Delivery Certificate appearing on the
Bond) to the scheduled due date , or date of prepayment or
redemption prior to the scheduled due date , of the principal
installments of the Bonds , at a per annum rate equal to the
Bond Interest Rate (as defined in Section 5 hereof) , with a
minimum rate of 9% per annum and a maximum rate of 15% per
annum. The interest shall be payable on the dates and in
the manner provided in Section 5 .
Section 4 . GENERAL CHARACTERISTICS OF THE BONDS.
(a) In General. The Bonds initially authorized hereby
shall be issued, shall be payable , may or shall be prepaid
or redeemed prior to the scheduled principal installment
payment dates , may be transferred and assigned, shall have
the characteristics , and shall be signed, executed and
sealed, all as provided and in the manner indicated in
Section 5 . After the Bonds have been authorized to be
issued by the Board but prior to the delivery of the Bonds ,
the Trustee shall authenticate the Bonds by executing the
Trustee ' s Certificate of Authentication appearing on the
Bonds as provided in Section 5 . In addition, on the date of
delivery of the Bonds to the initial purchasers thereof, the
Trustee shall fill in the date of delivery of the Bonds in
the Delivery Certificate appearing on the Bonds as provided
in Section 5 .
(b) RRe i�stration Books . The Corporation shall keep or
cause to be kept at the principal corporate trust office of
the Trustee books for the registration and transfer of Bonds
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(the "Bond Registration Books") and the Corporation hereby
appoints the Trustee as its registrar and transfer agent
(the "Registrar") to keep such books and make such
registrations and transfers under reasonable regulations as
the Corporation or the Registrar may prescribe; and the
Registrar will register or transfer as herein provided any
Bonds upon presentation thereof at such office. The
Corporation, the User and each Bondholder shall have the
right to inspect the Bond Registration Books during the
normal business hours of the Trustee .
Registration of the Bonds may be transferred only on
the Bond Registration Books upon surrender thereof by the
registered owner in person or by his duly authorized
attorney, by proper written instrument or transfer, in the
form and with guaranty of signatures satisfactory to the
Registrar, duly executed by such owner or attorney. Upon
such surrender for transfer of registration, the Registrar
shall make notation of such transfer on the Bonds in the
Assignment section appearing thereon and in the Bond Regis-
tration Books . Such transfers of registration shall be made
without charge to the owner of such Bonds , but any taxes or
other governmental charges required to be paid with respect
to the same shall be paid by the Bondholder requesting such
transfer of registration, as a condition precedent to the
exercise of such privilege.
(c) Payment to Registered Owner. The person in whose
name any Bond shall e registered on the Bond Registration
Books may be deemed and treated as the absolute owner
thereof for all purposes of this Bond Resolution and the
Trust Indenture whether or not such Bond shall be overdue,
and the Corporation, the Trustee , and the User shall not be
affected by any notice to the contrary; and payment of, or
on account of, the principal of, premium, if any, agreed
liquidated damages , if any, and interest on any such Bond
shall be made only to such registered owner thereof; but
such registration may be changed as provided herein. All
such payments shall be valid and effectual to satisfy and
discharge the liability upon such Bond to the extent of the
sum or sums so paid.
(d) Notation of Prepayment. The Corporation hereby
appoints t e Trustee as the Paying Agent for the Bonds .
Upon the prepayment or partial redemption of any Bond, the
Trustee, as Registrar and Paying Agent , shall note in the
Prepayment Record appearing on such Bond the amount of such
prepayment or redemption, the date said payment was made and
the remaining unpaid principal balance of said Bond and
shall then have said entry signed by an authorized official
of the Trustee. The Trustee shall also record such
information in the Bond Registration Books , and the Trustee
shall also record in the Bond Registration Books all
payments of principal installments on the Bonds when made on
their respective due dates .
Section 5 . FORM OF BOND. The form of Bond, together
with the forms of the various certificates and forms to
appear on the Bonds , shall be substantially as follows , with
necessary and appropriate variations , omissions , and
insertions as permitted or required by this Bond Resolution:
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FORM OF BOND
NO. $
UNITED STATES OF AMERICA
STATE OF TEXAS
BEAUMONT INDUSTRIAL DEVELOPMENT CORPORATION
INDUSTRIAL DEVELOPMENT REVENUE BOND
SERIES 1982
(700 CALDER, INCORPORATED PROJECT)
BEAUMONT INDUSTRIAL DEVELOPMENT CORPORATION (the
"Corporation") , being a nonstock, nonprofit industrial
development corporation organized and existing under the
laws of the State of Texas , including particularly the
Development Corporation Act of 1979 , Art. 5190 . 6 , Vernon' s
Annotated Texas Civil Statutes (the "Act") , and acting on
behalf of the City of Beaumont, Texas , hereby promises to
pay to or its
registered assigns , the aggregate principal amount of
DOLLARS
in installments , as follows :
PRINCIPAL PRINCIPAL
DATE AMOUNT DATE AMOUNT
1/1/85 1/1/95
2/1/85 2/1/95
3/1/85 3/1/95
4/1/85 4/1/95
5/1/85 5/1/95
6/1/85 6/1/95
7/1/85 7/1/95
8/1/85 8/1/95
9/1/85 9/1/95
10/1/85 10/1/95
11/1/85 11/1/95
12/1/85 12/1/95
1/1/86 1/1/96
2/1/86 2/1/96
3/1/86 3/1/96
4/1/86 4/1/96
5/1/86 5/1/96
6/1/86 6/1/96
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PRINCIPAL PRINCIPAL
DATE AMOUNT DATE AMOUNT
7/1/86 7/1/96
8/1/86 8/1/96
9/1/86 9/1/96
10/1/86 10/1/96
11/1/86 11/1/96
12/1/86 12/1/96
1/1/87 1/1/97
2/1/87 2/1/97
3/1/87 3/1/97
4/1/87 4/1/97
5/1/87 5/1/97
6/1/87 6/1/97
7/1/87 7/1/97
8/1/87 8/1/97
9/1/87 9/1/97
10/1/87 10/1/97
11/1/87 11/1/97
12/1/87 12/1/97
1/1/88 1/1/98
2/1/88 2/1/98
3/1/88 3/1/98
4/1/88 4/1/98
5/1/88 5/1/98
6/1/88 6/1/98
7/1/88 7/1/98
8/1/88 8/1/98
9/1/88 9/1/98
10/1/88 10/1/98
11/1/88 11/1/98
12/1/88 12/1/98
1/1/89 1/1/99
2/1/89 2/1/99
3/1/89 3/1/99
4/1/89 4/1/99
5/1/89 5/1/99
6/1/89 6/1/99
7/1/89 7/1/99
8/1/89 8/1/99
9/1/89 9/1/99
10/1/89 10/1/99
11/1/89 11/1/99
12/1/89 12/1/99
1/1/90 1/1/2000
2/1/90 2/1/00
3/1/90 3/1/00
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PRINCIPAL PRINCIPAL
DATE AMOUNT DATE AMOUNT
4/1/90 4/1/00
5/1/90 5/1/00
6/1/90 6/1/00
7/1/90 7/1/00
8/1/90 8/1/00
9/l/90 9/1/00
10/1/90 10/1/00
11/1/90 11/1/00
12/1/90 12/1/00
1/1/91 1/1/01
2/1/91 2/1/01
3/1/91 3/l/01
4/1/91 4/1/01
5/1/91 5/1/01
6/1/91 6/1/01
7/1/91 7/1/01
8/1/91 8/l/01
9/l/91 9/1/01
10/1/91 10/1/01
11/1/91 11/1/01
12/1/91 12/1/01
1/1/92 1/1/02
2/1/92 2/l/02
3/1/92 3/1/02
4/1/92 4/1/02
5/1/92 5/1/02
6/1/92 6/1/02
7/1/92 7/1/02
8/1/92 8/1/02
9/1/92 9/1/02
10/1/92 10/l/02
11/1/92 11/1/02
12/1/92 12/1/02
l/l/93 1/1/03
2/1/93 2/1/03
3/1/93 3/1/03
4/1/93 4/1/03
5/1/93 5/1/03
6/1/93 6/1/03
7/1/93 7/1/03
8/1/93 8/1/03
9/1/93 9/l/03
10/1/93 10/1/03
11/1/93 11/1/03
12/1/93 12/1/03
PRINCIPAL PRINCIPAL
DATE AMOUNT DATE AMOUNT
1/1/94 1/1/04
2/1/94 2/1/04
3/1/94 3/1/04
4/1/94 4/1/04
5/1/94 5/1/04
6/1/94 6/1/04
7/1/94 7/1/04
8/1/94 8/1/04
9/1/94 9/1/04
10/1/94 10/1/04
11/1/94 11/1/04
12/1/94 12/1/04
and to pay interest thereon, from the date of delivery
hereof (which date appears in the Delivery Certificate
endorsed on this Bond) , on the balance of said principal
amount from time to time remaining unpaid, at a per annum
rate equal to the Bond Interest Rate (as hereinafter
defined) , with a minimum rate of 9% per annum and a maximum
rate of 15% per annum, and at a rate of 15% per annum on
overdue principal and, to the extent legally permissible , on
overdue interest, with the interest being payable during the
period from December 1 , 1982 , and thereafter while this Bond
is outstanding, on the first day of each month commencing
January 1 , 1983 ; provided that such principal and interest
are payable solely from the sources and in the manner
hereinafter described, and solely as authorized and provided
in the Act.
THE TERM "PRIME RATE" shall mean the annual rate of
interest announced by Allied Bank Beaumont from time to time
for prime commercial loans of 90-day maturities to its most
creditworthy customers , adjusted on a quarterly basis . Such
adjustments shall be made on the first day of each January,
April, July and October (or if a non-banking day, then on
the succeeding banking day) , commencing January 1, 1983 .
For purposes of this Bond, the Prime Rate in effect on the
date hereof shall be deemed to be 12%. The term "Bond
Interest Rate" shall mean the Prime Rate multiplied by . 70 .
Accordingly, for purpose of illustration only, if the Prime
Rate equals 12% , the Bond Interest Rate would be 8 . 40% ,
increased to the minimum rate of 9% per annum.
THE TRUSTEE (as hereinafter defined) shall give the
Corporation and the User telephone notice [confirmed by the
Trustee ' s written notice to the User and the Corporation
r!�- �/�/ -12-
pursuant to the notice provisions contained in Section 6 . 06
of the Agreement (as hereinafter defined) ] of the Bond
Interest Rate, the Trustee ' s determination of such Rate and
the total interest due on the then outstanding principal
amount of this Bond (the "Interest Calculation") on a date
(the "Calculation Date") not less than five (5) days prior
to the date (the "Payment Date") fixed for any payment of
interest on any unpaid principal installment of this Bond.
The Interest Calculation shall establish the full amount of
interest due on a particular Payment Date. The Interest
Calculation with respect to a particular Payment Date shall
be made on the Calculation Date therefor using the Bond
Interest Rate as of such Calculation Date. If the Bond
Interest Rate as of a particular Payment Date differs from
the Bond Interest Rate as of the Calculation Date therefor,
the Interest Calculation for the period preceding the next
Calculation Date (and accordingly the amount of interest due
on the next Payment Date) shall be adjusted to reflect such
difference. Provided, however, with respect to the Interest
Calculation for the Payment Date on which the Corporation
shall pay the entire principal amount of this Bond, any such
adjustment shall be made on such Payment Date and the
Trustee shall provide the Corporation and the User with
telephone notice (confirmed by written notice as aforesaid)
of any such adjustment and the Corporation shall pay the
actual amount of interest due as of such Payment Date.
THE PRINCIPAL of and interest on this Bond shall be
payable in lawful money of the United States of America,
without exchange or collection charges . Payment of
principal and interest, shall be made to the registered
owner by check or draft mailed by Allied Merchants Bank of
Port Arthur, Texas (the "Trustee" , "Paying Agent" , and
"Registrar" for this Bond) or its successor appointed under
the Trust Indenture (hereinafter defined) , to the registered
owner at its address as it appears on the Bond Registration
Books kept by the Trustee; provided that in the alternative
such payment may be made by any other method requested in
writing by the registered owner, subject to the approval of
the Trustee. The final payment of principal on this Bond
shall be paid only upon surrender of this Bond to the
Trustee for cancellation. Any prepayment or redemption of
any principal installments of this Bond shall be made only
upon presentation of this Bond to the Trustee , who shall
make notation of such prepayment or redemption in the
Prepayment Record endorsed hereon.
THIS BOND is one of a series of Bonds dated as of
December 1 , 1982 , authorized and issued in the aggregate
-13-
principal amount of $2 , 650 , 000 pursuant to a resolution
adopted by the Board of Directors of the Corporation (the
"Bond Resolution") on behalf of the City of Beaumont , Texas ,
all issued or to be issued under a trust indenture, dated as
of December 1 , 1982 (the "Trust Indenture") , between the
Corporation and the Trustee, pursuant to and in full
conformity with the Constitution and the laws of the State
of Texas . The Bonds are issued in order to provide funds
for the Corporation to lend to 700 Calder, Incorporated (the
"User") , a Texas corporation qualified to do business in
that State, to finance the acquisition and construction of
certain commercial facilities (together with the User' s
interest in the site thereof, the "Project") . The proceeds
of the sale of the Bonds will be lent to the User pursuant
to a loan agreement , dated as of December 1, 1982 (the
"Agreement") , between the Corporation and the User, and the
User ' s obligations under the Agreement will be further
evidenced by the User' s execution and issuance of a note
(the "Note") in an amount equal to the aggregate principal
amount of the Bonds . Contemporaneously with the execution
of the Agreement, the User executed a deed of trust and
security agreement dated as of December 1 , 1982 (the "Deed
of Trust") , pursuant to which the User bargained, sold,
granted, conveyed, transferred, mortgaged, pledged and
assigned to Bruce H. Whitehead, as mortgage trustee, for the
use and benefit of the Corporation, and further granted to
the Corporation a security interest in, certain portions of
the Project, in order to secure the payment of the
Installment Loan Payments (as defined in the Agreement) and
the Note , according to their tenor and effect , and certain
other indebtedness of the User, and the performance and
observance by the User of all of the covenants expressed or
implied in the Deed of Trust , the Agreement , and the Note;
and the Corporation executed a collateral assignment and
security agreement dated as of December 1 1982 (the
"Collateral Assignment") , pursuant to which the Corporation
conveyed, assigned, transferred and delivered and granted a .
security interest to the Trustee in the Note and all rights ;
titles , interest , liens , privileges , claims , demands and
equities existing and to exist in connection with or as
security for payment of the Note , including its rights ,
titles and interests arising under the Deed of Trust in
order to secure payment of the Bonds according to their
tenor and effect and the performance by the Corporation of
all the covenants expressed or implied herein and in the
Trust Indenture and the Collateral Assignment.
ON ANY DATE, the unpaid principal installments of this
Bond are subject to optional prepayment or redemption and
-14-
may be prepaid or redeemed prior to their scheduled due
dates , by the Trustee, at the option of the Corporation,
upon written notice of the exercise of the option to prepay
or redeem delivered to the Trustee by the Corporation not
later than the 45th day prior to the date of prepayment or
redemption. Such unpaid principal installments may be so
prepaid or redeemed as a whole on any date , or in part on
any interest payment date (and, if in part, such installment
shall be prepaid or redeemed in inverse chronological order
of their scheduled due dates , and in amounts not less than
all of an unpaid principal installment) , for the principal
amount thereof and accrued interest thereon to the date of
prepayment or redemption but without any premium.
PROMPTLY AFTER ANY DATE ON WHICH the unpaid principal
installments of this Bond are subject to mandatory
prepayment or redemption as a whole as a result of
occurrence of a Taxable Event and a Final Determination of
Taxability, all such installments shall be prepaid or
redeemed prior to their scheduled due dates by the Trustee,
with funds which shall be furnished by the Corporation, on
the earliest practicable date , and in all events within
sixty days , following the latter of such occurrences as
provided for in the Agreement. The prepayment or redemption
price in such event shall be equal to the unpaid principal
amount of this Bond so prepaid or redeemed, plus accrued
interest to the date of prepayment or redemption, plus an
additional amount calculated by multiplying an amount equal
to 1% of the unpaid principal amount of this Bond by the
number of complete 3-month periods elapsed between the date
of the Taxable Event and the actual prepayment or redemption
date , with such additional amount being payable on the
prepayment or redemption date to the extent not theretofore
paid pursuant to the next following paragraph and with such
additional amount being the agreed liquidation damages (for
loss of a bargain and not as a penalty) which the owner of
this Bond will be due because of the breach of the covenants
in Section 4 . 06 of the Agreement with respect to the tax
exempt status of the interest on this Bond. Such prepayment
or redemption price shall constitute the entire amount due
with respect to this Bond as a result of the occurrence of a
Taxable Event and a Final Determination of Taxability.
IN ADDITION, if there shall be a Taxable Event and a
Final Determination of Taxability, the Corporation shall be
obligated to pay, and promptly shall make payment of, an
additional amount to the Trustee for the sole benefit of the
owner or owners of this Bond during the period between the
Taxable Event and the Final Determination of Taxability (the
�/ -15-
"Applicable Period") . Such payment shall be sufficient in
the aggregate to pay in respect of each principal
installment of this Bond which was paid or prepaid or
redeemed during the Applicable Period, the amount the owner
hereof would have received as agreed liquidated damages
pursuant to the immediately preceding paragraph if and
assuming that the aforesaid mandatory redemption date had
occurred on the actual date of payment or prepayment or
redemption of such principal installment. The Trustee shall
pay such additional amount to the owner or owners of this
Bond during the Applicable Period, as shown by the Bond
Registration Books.
ON ANY DATE but only with and to the extent of any
surplus funds remaining in the Construction Fund after the
completion of the Project as provided and required by
Section 16 of the Bond Resolution, the unpaid principal
installments of this Bond shall be prepaid or redeemed prior
to the scheduled due dates by the Trustee , in inverse
chronological order of their scheduled due in
(in the
denominations of $1, 000 or any integral multiple thereof or
in amounts not less than all of an unpaid principal
installment) , at a prepayment or redemption price equal to
the principal amount thereof to be prepaid or redeemed plus
accrued interest thereon to the date of prepayment or
redemption, and without premium.
IF THE FULL PRINCIPAL AMOUNT OF THS BOND IS OTHERWISE
UNPAID, and if between the first day of any July and August
in any year commencing on August 1 , 1987 , the owners of 75%
in aggregate principal amount of the Bonds then outstanding
shall notify the Trustee in writing that they elect
mandatory redemption of their Bonds , then, in such event ,
the Trustee shall so notify the Corporation and the User no
later than the tenth day of the next following September,
whereupon the Trustee shall redeem on the next following
December 1 , with funds provided by the Corporation, this
Bond and all other Bonds then outstanding at a redemption
price equal to the unpaid principal amount of this Bond and
all other Bonds on such December 1 , plus accrued interest
hereon to such date , but without premium of any kind.
ON OR BEFORE DECEMBER 1 , 1987 , this Bond is subject to
purchase in whole by the User or its designee , and may be
purchased by the User or its designee, at the User' s option,
at a purchase price equal to the unpaid principal
installments hereof, plus accrued interest hereon to the
date of purchase, and without premium. By the purchase and
acceptance of this Bond, the owner thereof agrees to enter
-16-
into a timely, binding commitment to sell this Bond to the
User or its designee on such date as the User or its
designee shall designate, which date shall be on or before
December 1, 1987 , at a price equal to the principal amount
hereof plus accrued interest hereon to the date of such
sale , and without premium.
THE AGREEMENT recites that any provision for any
payment of this Bond contained in the Agreement shall be
held to be subject to reduction to the amount allowed under
the usury laws of the State of Texas as now or hereafter
construed by the courts having jurisdiction, and it is
agreed by the Corporation and the owner of this Bond that in
no event shall usury be paid or collected with respect to
this Bond (whether as or in the form of liquidated damages
or otherwise) .
AT LEAST 7 DAYS PRIOR to the date fixed for any
prepayment or redemption of the unpaid principal
installments of this Bond, the Trustee shall cause a written
notice of such redemption to be mailed to the registered
owner of this Bond addressed to such owner at the address
appearing on the Bond Registration Books . By the date fixed
for any such prepayment or redemption, due provision shall
be made by the Corporation with the Trustee and the Paying
Agent for the payment of the principal amount of this Bond
which is to be prepaid or redeemed, plus accrued interest
thereon to the date fixed for prepayment or redemption, plus
any required prepayment or redemption premium, and any other
amounts due the owner of this Bond. If such written notice
of prepayment or redemption is given and if due provision
for payment of the redemption price is made, all as provided
above , the unpaid principal installments of this Bond which
are to be prepaid or redeemed, thereby automatically shall
be deemed to have been prepaid or redeemed prior to their
scheduled due dates , and they shall not bear interest after
the date fixed for prepayment or redemption, and they shall
not be regarded as being outstanding except for the right of
the owner hereof to receive the redemption price from the
Paying Agent out of the funds provided for such payment.
Upon presentation of this Bond to the Paying Agent , such
unpaid principal installments which are to be prepaid or
redeemed shall be paid at the redemption price. Except as
set forth above, this Bond is not subject to prepayment or
redemption prior to maturity.
IF THE DATE for the payment of the principal of or
interest on this Bond shall be a Saturday, Sunday, a legal
holiday, or a day on which banking institutions in the city
p //
-17-
where the Paying Agent is located are authorized by law or
executive order to close , then the date for such payment
shall be the next succeeding day which is not a Saturday,
Sunday, legal holiday, or day on which banking institutions
are authorized to close; and payment on such date shall have
the same force and effect as if made on the original date of
payment.
IT IS HEREBY CERTIFIED AND COVENANTED that this Bond
has been duly and validly authorized, issued, and delivered;
that all acts , conditions , and things required or proper to
be performed, exist, and be done precedent to or in the
authorization, issuance , and delivery of this Bond have been
performed, existed, and been done in accordance with law;
that this Bond is a special revenue obligation of the
Corporation, and that the principal of and interest on this
Bond are payable from and secured by a first lien on and
pledge of the payments designated as "Installment Loan
Payments" to be made or paid, or caused to be made or paid,
to the Trustee , pursuant to the Bond Resolution, the Trust
Indenture and the Agreement. The User, which is a
corporation organized and existing under the laws of the
State of Texas , is unconditionally obligated to make or pay,
or cause to be made or paid, without set-off, recoupment , or
counterclaim, to the Trustee each such "Installment Loan
Payment" for deposit into the Debt Service Fund created for
the benefit of the Bonds by the Bond Resolution, in
aggregate amounts sufficient to pay and redeem, and provide
for the payment and redemption of, the principal of and
interest on this Bond, and to pay all other amounts required
by the Agreement , the Bond Resolution, and the Trust
Indenture when due, subject to and as required by the
provisions of the Agreement, the Bond Resolution, and the
Trust Indenture.
THIS BOND is secured by the Trust Indenture whereunder
the Installment Loan Payments are pledged as collateral and
the Trustee is custodian of the Debt Service Fund and is
obligated to enforce the rights of the owner of this Bond
and to perform other duties in the manner and under the
conditions stated in the Trust Indenture. In case an "Event
of Default" , as defined in the Trust Indenture , shall occur,
the unpaid principal installments of this Bond may be
declared to be due and payable immediately upon the
conditions and in the manner provided in the Trust
Indenture. This Bond is additionally secured by the
Collateral Assignment of the Corporation' s rights with
respect to the Note and the Deed of Trust. Reference is
hereby made to the Bond Resolution, the Trust Indenture, the
Deed of Trust , the Agreement and the Collateral Assignment
for additional provisions with respect to the nature and
extent of the security, the rights , duties , and obligations
of the User, the Corporation, the Trustee, and the owner of
this Bond, the terms upon which this Bond is issued and
secured, and the modification of any of the foregoing.
THE CORPORATION has reserved the right , subject to the
restrictions stated in the Bond Resolution, to issue
additional parity revenue bonds ("Additional Bonds") which,
when issued and delivered, shall be payable from the Debt
Service Fund, and shall be payable from and secured by a
first lien on the pledge of "Installment Loan Payments"
pursuant to the Agreement and entitled to the benefits of
and secured by the Trust Indenture, and the Deed of Trust in
the same manner and to the same extent as , and shall be on a
parity with, this Bond and all then outstanding Additional
Bonds .
THE CORPORATION also has reserved the right to amend
the Bond Resolution and the Trust Indenture , as provided
therein; and under some (but not all) circumstances
amendments thereto must be approved by the owners of 75% in
aggregate principal amount of the Bonds then outstanding and
any Additional Bonds then outstanding.
THE BONDS AND any coupons appertaining thereto are
limited obligations of the Corporation and shall be payable
solely out of the revenues derived from or in connection
with the Agreement , including all sums deposited from time
to time pursuant to the Agreement, the Trust Indenture and
the Note in the Debt Service Fund established under the
Trust Indenture , and in certain events out of amounts
attributable to Bond proceeds or amounts secured through
exercise of the remedies provided in the Trust Indenture, or
in the Deed of Trust, or in the Collateral Assignment upon
occurrence of an event of default thereunder. Neither the
State of Texas nor the City of Beaumont nor any political
corporation, subdivision or agency of the State of Texas
shall be obligated to pay the principal of or premium, if
any, or liquidated damages , if any, or interest on the Bonds
and neither the faith and credit nor the taxing power of the
State of Texas , the City of Beaumont, or any other political
corporation, subdivision or agency of the State of Texas is
pledged to the payment of the principal of or interest on
the Bonds . No recourse under this Bond shall be had against
any past, present or future officer of the Corporation or of
the City of Beaumont . The Bonds shall never be paid in
whole or in part out of any funds raised or to be raised by
e412-Y �v -19-
taxation or out of any other revenues of the Corporation,
the City of Beaumont, or the State of Texas except those
revenues pledged by the Trust Indenture.
THIS BOND may be assigned and shall be transferred only
on the Bond Registration Books of the Corporation kept by
the Trustee , as Registrar, upon the terms and conditions set
forth in the Bond Resolution, the Trust Indenture and the
Assignment provisions endorsed hereon. Such transfers shall
be without expense to the owner hereof, but any taxes or
other governmental charges required to be paid with respect
to the same shall be paid by the owner requesting such
transfer as a condition precedent to the exercise of such
privilege. The registered owner of this Bond may be deemed
and treated by the Corporation, the Trustee, and the User,
as the absolute owner thereof for all purposes , including
payment and discharge of liability upon such Bond to the
extent of such payment , and the Corporation, the Trustee,
and the User shall not be affected by any notice to the
contrary.
THIS BOND shall not be valid or become obligatory for
any purpose or be entitled to any security or benefit under
the Trust Indenture until the Trustee ' s Certificate of
Authentication hereon shall have been signed by the Trustee
and the Delivery Certificate hereon shall have been
completed.
IN WITNESS WHEREOF, this Bond has been signed with the
manual or facsimile signatures of the President and the
Secretary of the Corporation, and the official seal of the
Corporation affixed on this Bond.
BEAUMONT INDUSTRIAL
ATTEST: DEVELOPMENT CORPORATION
By:
Secretary President
(CORPORATION' S SEAL)
J/ -20-
FORM OF TRUSTEE ' S CERTIFICATE OF AUTHENTICATION
TRUSTEE' S CERTIFICATE OF AUTHENTICATION
This Bond is the Bond initially issued under the pro-
visions of the within mentioned Agreement, Bond Resolution,
and Trust Indenture.
ALLIED MERCHANTS BANK OF
PORT ARTHUR, TEXAS
By:
Its : Authorized Officer
TRUSTEE
FORM OF ASSIGNMENT
ASSIGNMENT
FOR VALUE RECEIVED, the registered owner of this Bond
last listed below sells , assigns , and transfers the within
Bond to the Assignee lasted listed below, and hereby author-
izes the transfer of this Bond on the Bond Registration
Books of the Trustee. Such assignment shall not be
effective until such Assignee presents this Bond to the
Trustee for verification of such assignment and gives the
Trustee its address to which payments shall be made and the
Trustee makes notation of such Assignment below.
DATE OF REGISTERED SIGNATURE
ASSIGNMENT OWNER ASSIGNEE OF REGISTRAR
r� // -21-
FORM OF DELIVERY CERTIFICATE
DELIVERY CERTIFICATE
THIS BOND was delivered to and paid for by the
purchaser hereon on
FORM OF PREPAYMENT RECORD
PREPAYMENT RECORD
Principal Name & Title Signature
Date Prepayment Remaining of Authorized of
of or Principal Officer Authorized
Pmt. Redemption Balance Making Entry Officer
99 -22-
Section 6 . PLEDGE. The Bonds and the interest thereon
are and shall be pay�a Ie from and secured by a first lien on
and pledge of the payments designated as Installment Loan
Payments to be made or paid, or caused to be made or paid,
to the Trustee by the User, pursuant and subject to the
terms and provisions of this Bond Resolution, the Trust
Indenture, and the Agreement; and such Installment Loan Pay-
ents are further pledged irrevocably to the establishment
and maintenance of the Debt Service Fund hereinafter
created. The Bonds are additionally secured as provided in
the Collateral Assignment.
Section 7 . DEBT SERVICE FUND.
(a) Establishment of Debt Service Fund. A separate
and special trust fund to be designated and known as the
"Debt Service Fund" shall be established by the Corporation
with the Trustee for the benefit of the owners of the Bonds
pursuant to the Agreement and the Trust Indenture , and
maintained as provided in this Bond Resolution and the Trust
Indenture, as long as any of the Bonds , or interest thereon,
is outstanding and unpaid.
(b) Accrued Interest. Immediately after the delivery
of the Bonds to the initial purchasers thereof, all accrued
interest , if any, received from the proceeds from the sale
and delivery of the Bonds , shall be transferred by the
Trustee into the Debt Service Fund.
(c) Installment Loan Payments . Pursuant to the
Agreement and the Trust Indenture , the User shall make or
pay, or cause to be made or paid, to the Trustee , which
shall deposit into the Debt Service Fund, Installment Loan
Payments as follows :
(1) On or before each interest payment date as
provided in Section 5 hereof, an amount which,
together with any other amounts then on deposit
therein and available for such purposes , will be
sufficient to pay the interest coming due on the
Bonds on each interest payment date; and
(2) On or before each principal payment date as
provided in Section 5 hereof, an amount which,
together with any other amounts then on deposit
therein and available for such purpose , will be
sufficient to pay the principal of the Bonds
scheduled to be paid on each principal payment
date; and
-23-
�'�-�- 7 7
(3) On or before any optional or mandatory prepayment
or redemption date as permitted or required in
Section 5 hereof, an amount which, together with
any other amounts then on deposit and available
for such purpose, will be sufficient to pay the
prepayment or redemption price (including any
agreed liquidated damages) specified therein; and
(4) Promptly after the occurrence of a Taxable Event
and a Final Determination of Taxability, the
additional amount required to pay the agreed
liquidated damages to the owners of the Bonds for
any installments of principal which were unpaid on
the date of any Taxable Event, but which were paid
or redeemed prior to the prepayment or redemption
of all unpaid principal installments after a Final
Determination of Taxability, all as provided in
Section 5 hereof; and
(5) On any date on which the Bonds are declared to be
immediately due and payable pursuant to the Trust
Indenture , an amount which, together with any
other amounts then on deposit and available for
such purpose , will be sufficient to pay the
principal of all Bonds then outstanding and the
interest accrued thereon to such date; and
(6) Promptly after receipt of each statement and
request for payment , an amount equal to the
charges of the Trustee for performing the duties
of Trustee and Registrar, and the charges of the
Paying Agent for the Bonds , as designated in
Section 5 hereof, for paying or redeeming
principal installments of the Bonds , and paying
the interest thereon.
In the event the User should fail to make , or cause to be
made, any of the required Installment Loan Payments set
forth in this Section, each such required payment shall
continue as an obligation of the User until fully paid, and
the User agrees to pay the same to the Trustee , for the
benefit of the owners of the Bonds , with interest thereon,
to the extent legally permissible , at the rate of 15% per
annum, from the date any such payment was due until payment
thereof.
(d) Redemption. The Bonds initially authorized
hereby shall be subject to redemption, and may or shall be
redeemed, as specified in Section 5 hereof.
-24-
(e) Payments from Debt Service Fund. Except as
otherwise specifically provided in this Bond Resolution or
the Trust Indenture, the Debt Service Fund shall be used by
the Trustee only to pay the principal of, and prepayment or
redemption premium, if any, agreed liquidated damages , if
any, and interest on the Bonds , when due , and the charges of
the Trustee , Registrar, and Paying Agent; and the Trustee
shall make available to the Paying Agent , out of the Debt
Service Fund, the amounts required to pay or redeem the
principal of and interest on the Bonds when due , and the
Trustee shall make all other payments as required by this
Initial Bond Resolution and the Trust Indenture.
(f) Immediately Available Funds .. The User shall make
all Installment Loan Payments in funds that will be
immediately available and allow the Paying Agent to pay, in
lawful money of the United States of America, the principal,
interest, and other amounts with respect to the Bonds , when
due.
(g) Investment of Funds . Any money held as part of
the Debt Service Fund s a 1 be invested or reinvested by the
Trustee , upon the written direction of the Approving Officer
in any obligations of the United States Government or its
agencies or in certificates of deposit of banks approved by
the Trustee , including certificates of deposit of the
Trustee. The Trustee shall make no investments except as
specifically directed by the Approving Officer. The
investments of the Debt Service Fund shall be deemed to be a
part of such Fund, and, for the purpose of determining the
amount of money in such Fund, such investments shall be
valued at their cost or market value, whichever is lower.
The income and profits , including realized discount on
obligations purchased, received from such investments shall
be deposited in or credited to the Debt Service Fund, and
any losses on investments thereon shall be charged against
the Debt Service Fund. If at any time it shall become
necessary that some or all of the investments made with the
moneys from the Debt Service Fund be redeemed or sold to
raise moneys necessary to comply with the provisions of this
Bond Resolution or the Trust Indenture, the Trustee shall,
without further authorization, effect such redemption or
sale , employing, in the case of a sale, any commercially
reasonable method of effecting the same. The Trustee shall
not be liable or responsible for any loss resulting from any
such investment or resulting from the redemption or sale of
any such investment as herein authorized, except that the
Trustee shall be liable for (1) any loss resulting from its
willful or negligent failure, within a reasonable time after
-25-
receiving the written direction from the Approving Officer,
to make , redeem, or sell any investment in the manner
provided for herein, and (2) except for any redemption or
sale made pursuant to the next preceding sentence of this
paragraph, for any loss resulting from the making,
redeeming, or selling of any investment which was not
authorized by written direction of the Approving Officer.
If the Trustee is unable , after reasonable effort and within
a reasonable time, to make, redeem, or sell any such
investment, it shall so notify in writing the Approving
Officer and thereafter the Trustee shall be relieved of all
responsibility with respect thereto. In the event of any
such loss , the User shall make additional deposits to
restore same if and to the extent required to enable the
Trustee to make all payments required to be made from the
Debt Service Fund, and such additional deposits shall
constitute additional amounts of "Installment Loan
Payments" .
Section 8 . SECURITY FOR FUNDS . All uninvested money
in all Funds established pursuant to this Bond Resolution
(including the Debt Service Fund and the Construction Fund)
shall be secured by the Trustee.
Section 9 . THE USER' S PAYMENTS.
(a) Unconditional Obli ation. The User has
covenanted in t e Agreement and the Trust Indenture, and, by
the approval of this Bond Resolution, the User further has
unconditionally obligated itself and agreed, regardless of
and notwithstanding any provisions of the Agreement (other
than Sections 6 . 01 and 6 . 02 thereof relating to merger,
consolidation, transfer of assets , and assignment) , and
regardless of the provisions of any other agreement or
contract to the contrary, to make or pay, or cause to be
made or paid, without set-off, recoupment, or counterclaim,
the Installment Loan Payments to the Trustee in the amounts
required by Section 7 (c) to be made into the Debt Service
Fund, and to make such payments on or before the dates
specified in this Bond Resolution and the Trust Indenture;
and said payments by the User shall be and constitute the
Installment Loan Payments as contemplated and required by
the Agreement. Each Bondholder is and shall be entitled to
rely unconditionally on the agreements , covenants , and
representations set forth in this Bond Resolution and the
Trust Indenture.
(b) Prepayments . It is further understood that the
User may prepay all or any part of each Installment Loan
-26-
1-2-�z��
Payment , and any such prepayment , and any earnings thereon,
shall be applied by the Trustee to the payment of each
Installment Loan Payment; provided that the prepayment or
redemption at any time of any unpaid principal installments
of the Bonds prior to their due dates , with funds from any
source (whether from Installment Loan Payments or
otherwise) , shall not relieve the User of its obligation to
make or pay, or cause to be made or paid, each Installment
Loan Payment as specified in Section 9(a) , when due with
respect to any remaining unpaid principal installments of
the Bonds .
Section 10 . ADDITIONAL PARITY BONDS.
(a) Additional Bonds . The Corporation reserves the
right , upon the request of the User, to issue additional
parity revenue bonds ("Additional Bonds") in any amounts ,
for any lawful purpose or purposes , including the refunding
of any outstanding Bonds . Such Additional Bonds , along with
the Bonds authorized by this Bond Resolution, shall be
considered, constitute , and be "Bonds" as defined in, and
for all purposes of, the Agreement and the Trust Indenture.
When issued and delivered, such Additional Bonds , the
redemption premium, if any, agreed liquidated damages , if
any, and the interest thereon shall be payable from the Debt
Service Fund, and shall be payable from and secured by a
first lien on and pledge of Installment Loan Payments
pursuant to the Agreement, and secured by the Trust
Indenture and the Collateral Assignment in the same manner
and to the same extent as , and be on a parity with, all then
outstanding Bonds and Additional Bonds . Such Additional
Bonds may be issued in one or more series or issues , in
various principal amounts , maturing at different times ,
bearing interest at different rates , be payable in
installments or otherwise be redeemable prior to maturity,
with or without redemption premium, on whatever terms or
prices , and may contain such other provisions as may be
provided in any Bond Resolution authorizing the issuance of
such Additional Bonds . It is provided, however, that no
series or issue of Additional Bonds shall be issued unless :
(i) In the opinion of Bond Counsel (A) the issu-
ance of such Additional Bonds will not adversely affect
the exemption from federal income taxation of the
interest on the then outstanding Bonds and Additional
Bonds , or affect the validity of the then outstanding
Bonds or Additional Bonds and (B) such Additional Bonds
are secured in the same manner and to the same extent
-27-
as and are on a parity with all then outstanding Bonds
and Additional Bonds ;
(ii) A certificate is executed by the President
and Secretary of the Corporation to the effect that no
default exists in connection with the Bonds or the
Trust Indenture (or any amendment or supplemental
thereto) or with any of the covenants or requirements
of this Bond Resolution or the Bond Resolutions (or any
amendments or supplements thereto) authorizing the
issuance of all then outstanding Bonds and Additional
Bonds , and that the Debt Service Fund contains the
amount then required to be on deposit therein;
(iii) The Bond Resolution authorizing the issuance
of such series or issue of Additional Bonds provides
for additional Installment Loan Payments to be
deposited into the Debt Service Fund in amounts
sufficient to pay all principal of, redemption premium,
if any, agreed liquidated damages , if any, and interest
on such Additional Bonds , together with all Trustee,
Registrar, and Paying Agent fees and expenses
attributable to such Additional Bonds ;
(iv) The Approving Officer and the Trustee, but
only with the consent of the holders of at least
seventy five percent (75%) of the then outstanding
principal amount of the Bonds and Additional Bonds , if
any, approve in writing the Bond Resolution authorizing
the issuance of such series or issue of Additional
Bonds , as required by the Agreement;
(v) The Trustee , Paying Agent, and principal and
interest payment dates during any year in which
principal and interest on such Additional Bonds are
scheduled to be paid, are the same for the Additional
Bonds and the Bonds .
(vi) The Texas Industrial Commission expressly
gives its prior approval to the issuance of such Addi-
tional Bonds .
(b) Amendments to Trust Indenture Unnecessar . It
shall not be necessary or required that t e Trust Indenture
be amended or supplemented to cause any series or issue of
Additional Bonds to be secured by the Trust Indenture. All
that shall be necessary or required to cause any such Addi-
tional Bonds to be secured by the Trust Indenture is for the
Corporation to deliver to the Trustee a certified copy of
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the Bond Resolution authorizing their issuance prior to the
delivery of such Additional Bonds .
Section 11 . SPECIAL COVENANTS . The Corporation
further covenants as o ows :
(a) Installment Loan Payments Pledged to Bonds Only.
Other than f or t e payment ot the Bonds and except as
provided in this Bond Resolution, the Trust Indenture and
the Collateral Assignment , the Installment Loan Payments ,
the Deed of Trust and the Note have not in any manner been
pledged to the payment of any debt or obligation of the
Corporation.
(b) Non-Encumbrance. While any of the Bonds are
outstanding, the Corporation will not (except with respect
to the Bonds and any Additional Bonds and except as provided
in the Agreement , any Bond Resolution, or the Trust
Indenture) in any manner whatsoever create, assume , or
suffer to exist , directly or indirectly, any mortgage, lien,
encumbrance, pledge , or charge against the Debt Service
Fund, the Installment Loan Payments , the Construction Fund,
the Deed of Trust , the Note, or any property or moneys
deposited with the Trustee.
(c) Performance by Corporation. The Corporation will
carry out a= of its covenants and obligations under this
Bond Resolution; and the Corporation may be required to
carry out such covenants and obligations by all legal and
equitable means , including, but without limitation, actions
for specific performance and the use and filing of mandamus
proceedings in any court of competent jurisdiction against
the Corporation.
(d) Certain Modifications Prohibited. The Corporation
covenants and agrees that it will not execute or permit the
execution of any contract or agreement, or terminate or
amend the Agreement , in any manner that would relieve or
abrogate the obligations of the User to make or pay, or
cause to be made or paid, when due , all Installment Loan
Payments , in the manner and to the extent required by the
Agreement , this Bond Resolution, and the Trust Indenture, or
which would change or affect Sections 4 . 04 , 4 . 05 , 4 . 06 , 6 . 01
and 6 . 02 of the Agreement without the written consent of all
of the Bondholders and the Trustee.
Section 12 . THE BONDS ARE SPECIAL OBLIGATIONS . The
Bonds and any coupons appertaining thereto are limited
obligations of the Corporation and shall be payable solely
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out of the revenues derived from or in connection with the
Agreement , including all sums deposited from time to time
pursuant to the Agreement , the Trust Indenture and the Note
in the Debt Service Fund established under the Trust
Indenture , and in certain events out of amounts attributable
to Bond proceeds or amounts secured through exercise of the
remedies provided in the Trust Indenture, or in the Deed of
Trust, or in the Collateral Assignment upon occurrence of an
event of default thereunder. Neither the State of Texas nor
the City of Beaumont nor any political corporation,
subdivision or agency of the State of Texas shall be
obligated to pay the principal of or premium, if any, or
liquidated damages , if any, or interest on the Bonds and
neither the faith and credit nor the taxing power of the
State of Texas , the City of Beaumont , or any other political
corporation, subdivision or agency of the State of Texas is
pledged to the payment of the principal of or interest on
the Bonds . No recourse under this Bond shall be had against
any past , present or future officer of the Corporation or of
the City of Beaumont . The Bonds shall never be paid in
whole or in part out of any funds raised or to be raised by
taxation or out of any other revenues of the Corporation,
the City of Beaumont , or the State of Texas except those
revenues pledged by the Trust Indenture. No present or
future Commissioner , member, officer or employee of the
Texas Industrial Commission shall be held liable for the
performance of any agreement , covenant or obligation under
the Bonds , this Bond Resolution, the Agreement, or the Trust
Indenture, or for any claim based thereon or otherwise with
respect thereto.
Section 13 . AMENDMENTS.
(a) Amendment with Consent of Owners of 75% of the
Bonds . Su ject to approval in writing by t e Corporation
(with the consent of the Approving Officer of the User) , the
owners of 75% in aggregate principal amount of the then
outstanding Bonds shall have the right from time to time to
approve any amendment to any Bond Resolution or to the Trust
Indenture (provided that the Trustee must approve any
amendment to the Trust Indenture) which may be deemed
necessary or desirable by the Corporation; provided,
however , that nothing herein contained shall permit or be
construed to permit the amendment, without the consent of
the owner of each of the then outstanding Bonds affected
thereby, of the terms and conditions of any Bond Resolution,
the Bonds , or the Trust Indenture , so as to :
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(1) change the Debt Service Fund requirements ,
interest payment dates , mandatory redemption
provisions , or the due date or dates , or the
maturity or maturities of the outstanding Bonds ;
(2) reduce the rate of interest borne by any of the
outstanding Bonds ;
(3) reduce the terms of the principal of, redemption
premium, if any, liquidated damages , if any, or
interest on the outstanding Bonds , or impose any
conditions with respect to such payments ;
(4) modify the terms of payment of principal of,
redemption premium, if any, liquidated damages , if
any, or interest on the outstanding Bonds , or
impose any conditions with respect to such
payments ;
(5) affect the rights of the owners of less than all
of the Bonds then outstanding;
(6) decrease the minimum percentage of the principal
amount of Bonds necessary for consent to any such
amendment; or
(7) alter the obligations of the User to pay Install-
ment Loan- Payments in the manner and to the extent
provided in the Agreement, this Bond Resolution,
and the Trust Indenture.
(b) Notice of Amendment. If at any time the
Corporation shall esire to amend any Bond Resolution or the
Trust Indenture under this Section, the Corporation shall
file a copy of the proposed amendment at the principal
office of the Trustee and shall cause notice of the proposed
amendment to be published at least once in a financial
newspaper, journal or publication of general circulation in
The City of New York, New York, or in the State of Texas ,
during each calendar week for at least two successive
calendar weeks . If, because of temporary or permanent
suspension of the publication or general circulation of all
such financial newspapers , journals and publications , it is
impossible or impractical to publish such notice in the
manner provided herein, then such publication in lieu
thereof as shall be made by the Trustee shall constitute a
sufficient publication of notice. Such notice shall briefly
set forth the nature of the proposed amendment and shall
state that a copy thereof is on file at the principal office
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of the Trustee for inspection by all owners of Bonds . Such
publication is not required, however, if notice in writing
is given to each owner of Bonds .
(c) Consent to Amendment. Whenever at any time (but
not less than 30 days nor more than one year from the date
of the first publication of said notice or other service of
written notice) the Corporation shall receive an instrument
or instruments executed by the owners of at least 757 in
aggregate principal amounts of all Bonds then outstanding,
which instrument or instruments shall refer to the proposed
amendment described in said notice and shall specifically
consent to and approve such amendment, the Corporation may
adopt the amendatory resolution in substantially the same
form.
(d) Effect of Amendment. Upon the adoption of any
amendatory resolution pursuant to the provisions of this
Section, any such Bond Resolution or the Trust Indenture,
shall be deemed to be amended in accordance with such
amendatory resolution, and the respective rights , duties ,
and obligations of all the Bondholders under such amendatory
resolution or the Trust Indenture shall thereafter be deter-
mined and exercised subject in all respects to such
amendments .
(e) Consent of Bondholders . Any consent given by a
Bondholder pursuant to the provisions of this Section shall
be irrevocable for a period of six months from the date of
the first publication or other giving of the notice provided
for in this Section, and shall be conclusive and binding
upon all future owners of the same Bond during such period.
Such consent may be revoked at any time after six months
from the date of the first publication or other giving of
such notice by the Bondholder who gave such consent, or by a
successor in title , by filing notice thereof with the
Trustee and the Corporation, but such revocation shall not
be effective if the owners of 75% in aggregate principal
amount of the then outstanding Bonds have, prior to the
attempted revocation, consented to and approved the
amendment.
(f) Ownership of the Bonds . For the purpose of this
Section, the fact of being a Bondholder, the amount and
numbers of such Bonds , and the date of being a Bondholder
may be conclusively presumed, or may be proved by an
affidavit satisfactory to the Corporation and the Trustee of
the person claiming to be such Bondholder, or by a
certificate executed by any trust company, bank, banker, or
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any other depository wherever situated showing that at the
date therein mentioned such person has on deposit with such
trust company, bank, banker, or other depository, the Bonds
described in such certificate , or in any other manner,
whether or not the Bonds are so deposited, as the Trustee
may approve. The Corporation may conclusively presume that
the status of any Bondholders will continue until written
notice to the contrary is served upon the Corporation.
(g) Amendments Without Consent. Notwithstanding the
provisions of (a) through (f) of this Section, and without
publication of the proposed amendment and without the
consent of the Bondholders , but subject to approval of the
Approving Officer and, in the case of any amendment to the
Trust Indenture , with the approval of the Trustee , the
Corporation may, at any time, amend any Bond Resolution or
the Trust Indenture , to cure any ambiguity or cure , correct ,
or supplement any defective or inconsistent provision
contained therein, or make any other change that does not in
any respect materially and adversely affect the interest of
the Bondholders , provided that no such amendment shall be
made contrary to the proviso to Section 13(a) , and a duly
certified or executed copy of each such amendment shall be
filed with the Trustee.
Section 14 . ESTABLISHMENT OF CONSTRUCTION FUND.
(a) Deposit of Bond Proceeds into Construction Fund.
Prior to or immediately after the sale and delivery of the
Bonds authorized hereby, the Corporation shall establish the
Construction Fund with the Trustee, as defined in and
required by the Agreement . The Corporation shall deposit
all of the proceeds from the sale and delivery of the Bonds
authorized hereby into the Construction Fund. The Trustee
shall draw on and use the Construction Fund as hereinafter
provided. The amount so deposited into the Construction
Fund shall constitute the Loan made to the User by the
Corporation as contemplated and provided in the Agreement .
(b) Investment of Money in Construction Fund. Any
money held as part ot the Construction Fund, of er than the
amounts described in Section 15 (a) , shall be invested or
reinvested by the Trustee upon the written direction of the
Approving Officer in obligations of the United States
government or its agencies or in certificates of deposit of
banks approved by the Trustee , including certificates of
deposit of the Trustee. The Trustee shall make no
investments except as specifically directed in writing by
the Approving Officer. The investments of the Construction
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Fund shall be deemed to be a part of the Construction Fund,
and for the purpose of determining the amount of money in
. the Construction Fund, such investments shall be valued at
their cost or market value, whichever is lower. The income
and profits , (including realized discount on obligations)
received from such investments shall be deposited in or
credited to the Construction Fund, and any losses on
investments shall be charged against the Construction Fund.
Upon the written direction of the Approving Officer, the
Trustee shall redeem or sell all or any designated part of
such investments employing, in the case of a sale , any
commercially reasonable method of effecting the same. The
Trustee shall not be liable or responsible for any loss
resulting from the redemption or sale of any such investment
as herein authorized; except that , notwithstanding any
provisions of the Agreement, the Trustee shall be liable for
(1) any loss resulting from its willful or negligent
failure, within a reasonable time after receiving the
written direction from the Approving Officer, to make,
redeem, or sell any investment in the manner provided for
herein, and (2) any loss resulting from the making,
redeeming, or selling of any investment which was not
authorized by written direction of the Approving Officer.
If the Trustee is unable , after reasonable effort and within
a reasonable time after receipt of the required written
direction, to make, redeem, or sell any such investment, it
shall so notify in writing the Approving Officer, and
thereupon the Trustee shall be relieved of all liability or
responsibility with respect thereto.
(c) Deposit of Accrued Interest, Income , and Profits .
Any accrued interest received from the sale of the Bonds ,
and all income and profits received from the investment of
the Construction Fund shall , upon direction of the Approving
Officer (as soon as practicable after any receipt thereof
has been deposited in or credited to the Construction Fund) ,
be transferred by the Trustee and deposited into the Debt
Service Fund to be used 'to pay interest on the Bonds during
the period of construction of the Project.
Section 15 . PAYMENTS FROM CONSTRUCTION FUND.
(a) Co oration' s Administrative Overhead Expenses
and Other Costs . Immediately after the de ivery of t e
Bonds authorized hereby, the Trustee shall pay directly to
the Corporation the amount of $3 ,500 . 00 in accordance with
the Agreement, being the amount required to reimburse the
Corporation for its application fee and its administrative
and overhead expenses directly attributable and chargeable
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to the costs of issuance of the Bonds authorized hereby and
the acquisition, construction, commitment fees , equipping,
and furnishing of the Project. Also, immediately after the
delivery of the Bonds authorized hereby, the Trustee shall
pay directly out of the Construction Fund, promptly after
receiving the bills or statements therefor, all of the
actual expenses and costs of issuance of such Bonds ,
including, without limitation, financing charges , commitment
fees , printing and engraving expenses , the fees and expenses
of accountants , financial advisors , and attorneys , and the
initial fees and expenses of the Trustee.
(b) Reimbursement for and Payment of Cost of the Project.
Subject and subordinate to making the payments required by
the preceding paragraph, the Trustee shall make an initial
payment, if requested by the User in the manner described
below for payments from the Construction Fund, to reimburse
the User for any Cost of the Project, paid by the User prior
to such date of delivery. The Trustee shall make such
initial payment if requested, and shall make any subsequent
payments from the Construction Fund to enable the User to
pay, or to reimburse the User for paying, any Cost of the
Project , from time to time upon receipt by the Trustee of a
request of the User signed by the Approving Officer. Such
request shall be accompanied by a certificate (in the form
attached to the Agreement) stating with respect to each
payment as follows :
(i) the expenditures , in summary form, as to
which payment is to be made or for which reimbursement
is requested;
(ii) that the amounts requested are to be or have
been paid by the User for interest during construction,
acquisition and development of property, or to
contractors , subcontractors , materialmen, engineers ,
architects , or other persons who will perform or have
performed necessary or appropriate services or will
supply or have supplied necessary or appropriate
materials for the acquisition, construction, equipping,
and furnishing of the Project, as the case may be, and
that , to the best of the knowledge of the person
delivering the certificate, the fair value of such
interest , property, services , or materials is not
exceeded by the amounts requested to be paid;
(iii) that no part of the several amounts requested
to be paid to the User, as stated in such certificate
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has been or is the basis for the payment of any money
in any previous or then pending request;
(iv) that the payment of the amounts requested
will not result in a breach of any of the covenants of
the User contained in the Agreement, and particularly
those covenants in Sections and 4 . 06 and 6 . 04 thereof,
which relate to the Code and the Regulations ; and
(v) that the expenditure of such amounts to be
paid, when added to all previous disbursements from the
Construction Fund, will result in at least 90% of the
total of such disbursements , other than disbursements
for issuance expenses , being used to provide land or
property of a character subject to the allowance for
depreciation under Section 167 of the Code (which
expenditures are amounts paid or incurred that are , for
federal income tax purposes , chargeable to the
Project ' s capital account or would be so chargeable
with a proper election by the User [for example , under
Section 266 of the Code] but for a proper election by
the User to deduct such amounts) .
(c) Reliance by Trustee. The Trustee shall rely
fully on any such request ana certificate delivered pursuant
to this Section and shall not be required to make any
investigation in connection therewith. The Trustee may
request from time to time, and the User shall furnish,
supporting documentation for any amounts requested under
Section 15 (b) (ii) . If amounts paid by the Trustee with
respect to any portion of the Project should exceed the cost
thereof, the User shall promptly repay such overpayment into
the Construction Fund.
Section 16 . SURPLUS CONSTRUCTION FUNDS .
(a) Disposition of Surplus Funds . The completion of
the Project shaii be conc usive y evidenced, and the date of
completion shall be established by a written certificate of
completion to be signed by the Approving Officer and
delivered to the Trustee immediately upon completion of the
Project. If, upon the completion of the Project , there
shall be any surplus funds remaining in the Construction
Fund not required to provide for the payment of the Cost of
the Project , or if any funds are on hand in the Construction
Fund at the time of the release of the Trust Indenture under
the terms thereof, then any such funds shall be used
immediately to prepay or redeem principal installments of
the Bonds , in inverse chronological order, in the manner set
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forth in Section 5 hereof for the prepayment or redemption
of principal installments of the Bonds with surplus
Construction Fund moneys , to the extent of any such
available funds ; provided that prior to such use, the
Corporation and the Trustee shall have been furnished with
an unqualified opinion of Bond Counsel to the effect that
the use of moneys from the Construction Fund for such
purpose will be lawful and will not impair the exemption of
interest on the Bonds from federal income taxation; and
provided further that the User shall deposit into the
Construction Fund prior to such prepayment or redemption an
amount sufficient to cause the total amount in the
Construction Fund to be equal to (i) an integral multiple of
$1, 000 , or (ii) not less than all of the unpaid principal
installment or installments to be prepaid or redeemed.
(b) Disposition of Construction Fund upon Acceleration
and Redemption. I t e Trustee shall ec are the principal-
o± the Bonds- and the interest accrued thereon immediately
due and payable as the result of an Event of Default
specified in the Trust Indenture , or if the Bonds are
optionally or mandatorily prepaid or redeemed prior to
maturity as a whole in accordance with their terms , any
amounts remaining in the Construction Fund shall be used
immediately by the Trustee for the purpose of paying
principal of, redemption premium, if any, agreed liquidated
damages , if any, and interest on the Bonds when due.
Section 17 . DAMAGED, MUTILATED, LOST, STOLEN, OR
DESTROYED BONDS.
(a) Replacement Bonds . In the event any of the
outstanding Bonds aut orized hereby are damaged, mutilated,
lost , stolen, or destroyed, the Corporation shall execute,
and the Trustee shall authenticate , a new Bond of the same
principal amount and maturity of the damaged, mutilated,
lost , stolen, or destroyed Bond in exchange and substitution
for such Bond or in lieu of and substitution for such Bond.
(b) Application for Substitute Bonds . Application
for exchange and substitution o damage , mutilated, lost ,
stolen, or destroyed Bonds shall be made to the Corporation.
In every case, the applicant for a substitute Bond shall
furnish to the Corporation and to the Trustee such security
or indemnity as may be required by them to save each of them
and the Paying Agent harmless . In every case of loss ,
theft , or destruction of a Bond, the applicant shall also
furnish to the Corporation and to the Trustee evidence to
their satisfaction of the loss , theft, or destruction, and
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of the ownership of the lost Bond. In every case of damage
or mutilation of a Bond, the applicant shall surrender the
Bond so damaged or mutilated.
(c) No Default Occurred. Notwithstanding the
foregoing provisions of this Section, in the event any such
Bond shall have matured, and no default has occurred which
is then continuing in the payment of the principal of,
redemption premium, if any, agreed liquidated damages , if
any, or interest on the Bond, the Corporation may authorize
the payment of the same (without surrender thereof except in
the case of a damaged or mutilated Bond) instead of issuing
a substitute Bond, provided security or indemnity is
furnished as above provided in this Section.
(d) Char&e for Issuing Substitute Bonds . Prior to
the issuance of any substitute Bond, t e Corporation and the
Trustee may charge the owner of such Bond with all legal,
printing, and other expenses in connection therewith. Every
substitute Bond issued pursuant to the provisions of this
Section by virtue of the fact that any Bond is lost, stolen,
or destroyed shall constitute a contractual obligation of
the Corporation whether or not the lost , stolen, or
destroyed Bond shall be found at any time, or be enforceable
by anyone , and shall be entitled to all the benefits of the
Trust Indenture and this Bond Resolution equally and
proportionately with any and all other Bonds duly issued
under this Bond Resolution.
(e) Authority for Issuing Substitute Bonds . This
Bond Resolution snail constitute su icient authority for
the issuance of any such substitute bonds without necessity
of further action by the Board of Directors of the
Corporation or any other body or person, and the issuance of
such substituted Bonds is hereby authorized, notwithstanding
any other provisions of this Bond Resolution, except to the
extent otherwise required by law.
Section 18 . NO ARBITRAGE. The Corporation and the
User have covenants to anT—w—it-h the purchasers of the Bonds
that they will make no use of the direct or indirect
proceeds thereof at any time throughout the term thereof
which would cause the Bonds to be arbitrage bonds within the
meaning of Section 103 (c) of the Code or any Regulations or
rulings pertaining thereto; and by this covenant the
Corporation and the User are obligated to comply with the
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requirements of the aforesaid Section 103 (c) and all
applicable and pertinent Regulations relating to arbitrage
bonds .
THIS RESOLUTION PASSED and APPROVED this day of
November, 1982 .
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