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HomeMy WebLinkAboutResolution 1992-054 RESOLUTION NO. 92-54 A RESOLUTION authorizing the issuance of "NORTH RICHLAND HILLS PARK AND RECREATION FACILITIES DEVELOPMENT CORPORATION SALES TAX REVENUE BONDS, SERIES 1992 "; pledging certain "Pledged Revenues" of the Corporation, including "Gross Sales Tax Revenues", to the payment of the principal of and interest on said Bonds and enacting other provisions incident and related to the issuance, payment, security and delivery of said bonds, including the approval of a Financing/Use Agreement with the City, and resolving other matters incident and related to the issuance and sale of the Bonds. WHEREAS, the Board of Directors of the North Richland Hills Park and Recreation Facilities Development Corporation (the "Corporation") hereby finds and determines that $7,500,000 in principal amount of bonds should be issued at this time to finance the costs of land, buildings, equipment, facilities and improvements suitable for use for amateur (including children's) sports, athletic, entertainment and public park purposes and events, including (i) the construction of phase I of an athletic complex which includes an aquatic and tennis center, (ii) the acquisition of land and its development as soccer and baseball facilities and (iii) the payment of the costs of issuance related to the Bonds (the "Project"); and WHEREAS, the Board of Directors has further determined and hereby finds that the Project to be financed by the issuance of the bonds is for and on behalf of the City of North Richland Hills, Texas, and the principal amount of such bonds and other obligations of the Corporation payable in whole or in part from the "Pledged Revenues" (hereinafter defined), together with the amount of the costs of other projects (other than such bonds and other obligations) for which payments to be made in cash directly from such "Pledged Revenues" do not, in the aggregate, exceed $135,000,000; now, therefore, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE NORTH RICHLAND HILLS PARK AND RECREATION FACILITIES DEVELOPMENT CORPORATION: SECTION 1. Authorization - Desianation - PrinciDal Amount - PurDose. Bonds of the Corporation shall be and are hereby authorized to be issued in the aggregate principal amount of $7,500,000 to be designated and bear the title "NORTH RICHLAND HILLS PARK AND RECREATION FACILITIES DEVELOPMENT CORPORATION SALES TAX REVENUE BONDS, SERIES 1992 ", hereinafter referred to as the "Bonds" to finance the costs of land, buildings, equipment, facilities and improvements suitable for use for amateur (including children's) sports, athletic, entertainment and public park purposes and events, including (i) the construction of phase I of an athletic complex which includes an aquatic and tennis center, 0048171 currency of the United states of America, which at the time of payment is legal tender for the payment of public and private debts, and shall be without exchange or collection charges to the Holders. The selection and appointment of Team Bank, Fort Worth, Texas to serve as Paying Agent/Registrar for the Bonds is hereby approved and confirmed. The Corporation covenants to maintain and provide a Paying Agent/Registrar at all times until the Bonds are paid in full and discharged. Any successor Paying Agent/Registrar shall be a bank, trust company, financial institution or other entity qualified and authorized to serve in such capacity and perform the duties and services of Paying Agent/Registrar. Upon any change in the Paying Agent/Registrar for the Bonds, the Corporation agrees to promptly cause a written notice to be sent to the Holder affected by United states Mail, first class postage prepaid, which notice shall identify and give the address of the new Paying Agent/Registrar. Principal of and premium, if any, on the Bonds shall be payable at the Stated Maturities or upon their earlier redemption, only upon presentation and surrender of the Bonds to the Paying Agent/Registrar at its principal office. Interest on the Bonds shall be paid to the Holders whose name appear in the security Register at the close of business on the Record Date (the 15th day of the month next preceding each interest payment date) and shall be paid by the Paying Agent/Registrar (i) by check sent United states Mail, first class postage prepaid, to the address of the Holder recorded in the Security Register or (ii) by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the Holder. If the date for the payment of the principal of or interest on the Bonds shall be a Saturday, Sunday, a legal holiday, or a day when banking insti tutions in the city where the Paying Agent/Registrar is located is authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day when 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 payment was due. In the event of a non-payment of interest on one or more maturities on a scheduled payment date, and for thirty (30) days thereafter, a new record date for such interest payment for such maturity or maturities (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the Corporation. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date by united States Mail, first class postage prepaid, to the address of each Holder of such maturity or maturities appearing on the Security 0048171 -3- Register at the close of business on the last business day next preceding the date of mailing of such notice. SECTION 4. Redemotion. (a) optional Redemption. The Bonds maturing on and after September 1, 2003 shall be subject to redemption prior to maturity, at the option of the Corporation, in whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if within a stated Maturity by lot by the Paying Agent/ Registrar), on September 1, 2002 or on any date thereafter at the redemption price of par plus accrued interest to the date of redemption. (b) Exercise of Redemotion option. At least forty-five (45) days prior to a date set for the redemption of Bonds (unless a shorter notification period shall be satisfactory to the Paying Agent/Registrar), the Corporation shall notify the Paying Agent/Registrar of its decision to exercise the right to redeem Bonds, the principal amount of each Stated Maturity to be redeemed, and the date set for the redemption thereof. The decision of the Corporation to exercise the right to redeem Bonds shall be entered in the minutes of the governing body of the Corporation. (c) Selection of Bonds for Redemotion. If less than all outstanding Bonds of the same Stated Maturity are to be redeemed on a redemption date, the paying Agent/Registrar shall treat such Bonds as representing the number of Bonds outstanding which is obtained by dividing the principal amount of such Bond by $5,000 and shall select the Bonds, or principal amount thereof, to be redeemed within such Stated Maturity by lot. (d) Notice of RedemDtion. Not less than thirty (30) days prior to a redemption date for the Bonds, a notice of redemption shall be sent by united States Mail, first class postage prepaid, in the name of the corporation and at the Corporation's expense, to each Holder of a Bond to be redeemed in whole or in part at the address of the Holder appearing on the Security Register at the close of business on the business day next preceding the date of mailing such notice, and any notice of redemption so mailed shall be conclusively presumed to have been duly given irrespective of whether received by the Holder. All notices of redemption shall (i) specify the date of redemption for the Bonds, (ii) identify the Bonds to be redeemed and, in the case of a portion of the principal amount to be redeemed, the principal amount thereof to be redeemed, (iii) state the redemption price, (iv) state that the Bonds, or the portion of the principal amount thereof to be redeemed, shall become due and payable on the redemption date specified, and the interest thereon, or on the portion of the principal amount thereof to be redeemed, shall cease to accrue from and after the redemption date, and (v) specify that payment of the redemption price for the Bonds, or the principal amount thereof to be redeemed, shall be made at the principal office of the Paying Agent/ Registrar only upon 0048171 -4- presentation and surrender thereof by the Holder. If a Bond is subject by its terms to prior redemption and has been called for redemption and notice of redemption thereof has been duly given or waived as herein provided, such Bond (or the principal amount thereof to be redeemed) shall become due and payable, and interest thereon shall cease to accrue from and after the redemption date therefor, provided moneys sufficient for the payment of such Bonds (or of the principal amount thereof to be redeemed) at the then applicable redemption price are held for the purpose of such payment by the paying Agent/Registrar. SECTION 5. Reaistration - Transfer - Exchanae of Bonds - Predecessor Bonds. A Security Register for the Bonds relating to their registration, payment, and transfer or exchange shall at all times be kept and maintained on behalf of the Corporation by the paying Agent/Registrar, as provided herein and in accordance with the provisions of an agreement with the Paying Agent/Registrar and such rules and regulations as the Paying Agent/Registrar and the Corporation may prescribe. The Paying Agent/Registrar shall obtain, record, and maintain in the Security Register the name and address of each registered owner of the Bonds issued under and pursuant to the provisions of this Resolution. Any Bond may, in accordance with its terms and the terms hereof, be transferred or exchanged for Bonds of other authorized denominations upon the Security Register by the Holder, in person or by his duly authorized agent, upon surrender of such Bond to the principal office of the Paying Agent/Registrar for cancellation, accompanied by a written instrument of transfer or request for exchange duly executed by the Holder or by his duly authorized agent, in form satisfactory to the Paying Agent/Registrar. Upon surrender for transfer of a Bond at the principal office of the paying Agent/Registrar, one or more new certificates evidencing the Bonds, in authorized denominations, of like Stated Maturity and of a like aggregate principal amount as the Bond or Bonds surrender for transfer shall be registered and issued to the assignee or transferee of the previous Holders. At the option of the Holder, Bonds may be exchanged for other Bonds of authorized denominations and having the same Stated Maturity, bearing the same rate of interest and of like aggregate principal amount as the Bonds surrendered for exchange, upon surrender of the Bonds to be exchanged at the principal office of the paying Agent/Registrar. Whenever any Bonds are surrendered for exchange, the paying Agent/Registrar shall register and deliver new printed certificates evidencing the Bonds, executed on behalf of, and furnished by, the Corporation, to the Holder requesting the exchange. All Bonds issued upon any transfer or exchange of Bonds shall be delivered at the principal office of the Paying Agent/Registrar, or sent by united States Mail, first class postage prepaid, to the Holder and, upon the delivery thereof, the same shall be valid 0048171 -5- obligations of the Corporation, evidencing the same obligation to pay, and entitled to the same benefits under this Resolution, as the Bonds surrendered in such transfer or exchange. All transfers or exchanges of Bonds pursuant to this section shall be made without expense or service charge to the Holder, except as otherwise herein provided, and except that the Paying Agent/Registrar shall require payment by the Holder requesting such transfer or exchange of any tax or other governmental charges required to be paid with respect to such transfer or exchange. Bonds canceled by reason of an exchange or transfer pursuant to the provisions hereof are hereby defined to be "Predecessor Bonds," evidencing all or a portion, as the case may be, of the same obligation to pay evidenced by the Bond or Bonds registered and delivered in the exchange or transfer therefor. Additionally, the term "Predecessor Bonds" shall include any mutilated, lost, destroyed, or stolen Bond for which a replacement Bond has been issued, registered and delivered in lieu thereof pursuant to section 26 hereof and such new replacement Bond shall be deemed to evidence the same obligation as the mutilated, lost, destroyed, or stolen Bond. SECTION 6. Book-Entrv Only Transfers and Transactions. Notwithstanding the provisions contained in sections 3, 4 and 5 hereof relating to the payment, and transfer/exchange of the Bonds, the Corporation hereby approves and authorizes the use of "Book-Entry Only" securities clearance, settlement and transfer system provided by The Depository Trust Company (DTC), a limited purpose trust company organized under the laws of the State of New York, in accordance with the requirements and procedures identified in the Letter of Representation, by and between the Corporation, the Paying Agent/Registrar and DTC (the "Depository Agreement") relating to the Bonds. Pursuant to the Depository Agreement and the rules of DTC, the Bonds shall be deposited with DTC who shall hold said Bonds for its participants (the "DTC Participants"). While the Bonds are held by DTC under the Depository Agreement, the Holder of the Bonds on the security Register for all purposes, including payment and notices, shall be Cede & Co., as nominee of DTC, notwithstanding the ownership of each actual purchaser or owner of each Bond (the "Beneficial Owners") being recorded in the records of DTC and DTC participants. In the event DTC determines to discontinue serving as securities depository for the Bonds or otherwise ceases to provide book-entry clearance and settlement of securities transactions in general or the Corporation determines that DTC is incapable of properly discharging its duties as securities depository for the Bonds, the Corporation covenants and agrees with the Holders of the Bonds to cause Bonds to be printed in definitive form and provide for the Bond certificates to be issued and delivered to DTC 0048171 -6- Participants and Beneficial Owners, as the case may be. Thereafter, the Bonds in definitive form shall be assigned, transferred and exchanged on the Security Register maintained by the Paying Agent/Registrar and payment of such Bonds shall be made in accordance with the provisions of Sections 3, 4 and 5 hereof. SECTION 7. Execution - Reaistration. The Bonds shall be executed on behalf of the Corporation by the Chairman of the Board of Directors or President of the Corporation under its seal reproduced or impressed thereon and attested by the Secretary of the Corporation. The signature of said officers on the Bonds may be manual or facsimile. Bonds bearing the manual or facsimile signatures of individuals who are or were the proper officers of the Corporation on the Issue Date shall be deemed to be duly executed on behalf of the Corporation, notwithstanding that such individuals or either of them shall cease to hold such offices at the time of delivery of the Bonds to the initial purchasers and with respect to Bonds delivered in subsequent exchanges and transfers. No Bond shall be entitled to any right or benefit under this Resolution, or be valid or obligatory for any purpose, unless there appears on such Bond either a certificate of registration substantially in the form provided in Section 9C, manually executed by the Comptroller of Public Accounts of the State of Texas or his duly authorized agent, or a certificate of registration substantially in the form provided in Section 9D, manually executed by an authorized officer, employee or representative of the Paying Agent/Registrar, and either such certificate upon any Bond duly signed shall be conclusive evidence, and the only evidence, that such Bond has been duly certified, registered and delivered. SECTION 8. Initial Bond(s). The Bonds herein authorized shall be initially issued either (i) as a single fully registered bond in the total principal amount noted in Section 1 with principal installments to become due and payable as provided in Section 2 hereof and numbered T-1, or (ii) as nineteen (19) fully registered bonds, being one bond for each year of maturity in the applicable principal amount and denomination and to be numbered consecutively from T-1 and upward (hereinafter called the "Initial Bond(s) ") and, in either case, the Initial Bond(s) shall be registered in the name of the initial purchaser(s) or the designee thereof. The Initial Bond(s) shall be the Bonds submitted to the Office of the Attorney General of the State of Texas for approval, certified and registered by the Office of the Comptroller of Public Accounts of the State of Texas and delivered to the initial purchaser(s). Any time after the delivery of the Initial Bond(s), the Paying Agent/Registrar, pursuant to written instructions from the initial purchaser(s), or the designee thereof, shall cancel the Initial Bond(s) delivered hereunder and exchange therefor definitive Bonds of authorized denominations, Stated Maturities, principal amounts and bearing applicable interest rates for transfer and delivery to the Holders named at the addresses 0048171 -7- identified therefor; all pursuant to and in accordance with such written instructions from the initial purchaser(s), or the designee thereof, and such other information and documentation as the Paying Agent/Registrar may reasonably require. SECTION 9. Forms. A. Forms Generally. The Bonds, the Registration certificate of the Comptroller of Public Accounts of the State of Texas (to be printed on the Initial Bond(s) only), the certificate of Registration, and the form of Assignment to be printed on each of the Bonds, shall be substantially in the forms set forth in this section with such appropriate insertions, omissions, substitutions, and other variations as are permitted or required by this Resolution and may have such letters, numbers, or other marks of identification (including identifying numbers and letters of the Committee on Uniform Securities Identification Procedures of the American Bankers Association) and such legends and endorsements (including insurance legends on insured Bonds and any reproduction of an opinion of counsel) thereon as may, consistently herewith, be established by the Board of Directors of the Corporation or determined by the officers executing such Bonds as evidenced by the execution thereof. Any portion of the text of any Bonds may be set forth on the reverse thereof, wi th an appropriate reference thereto on the face of the Bond. The Bonds, including the Ini tial Bond (s) , shall be typewritten, printed, lithographed, or engraved or produced in any other similar manner, all as determined by the officers executing such Bonds as evidenced by their execution thereof. B. Form of Bond. REGISTERED NO. REGISTERED $ UNITED STATES OF AMERICA STATE OF TEXAS NORTH RICHLAND HILLS PARK AND RECREATION FACILITIES DEVELOPMENT CORPORATION SALES TAX REVENUE BOND, SERIES 1992 Issue Date: November 15, 1992 Interest Rate: Stated Maturity: CUSIP NO: Registered Owner: Principal Amount: DOLLARS The North Richland Hills Park and Recreation Facilities Development Corporation (hereinafter referred to as the "corporation"), a non-profit industrial development corporation organized and existing under the laws of the state of Texas, including Section 4B of Article 5190.6, Tex. Rev. civ. st. Ann., as 0048171 -8- amended, (the "Act"), with its principal office located in Tarrant County, Texas, for value received, hereby promises to pay to the order of the Registered Owner named above, or the registered assigns thereof, solely from the revenues and sources pledged under the Resolution identified below, the Principal Amount stated above (or so much thereof as shall not have been paid upon prior redemption) on the Stated Maturity date specified above and to pay interest (computed on the basis of a 360-day year of twelve 30-day months) on the unpaid Principal Amount hereof from the Issue Date at the per annum rate of interest specified above; such interest being payable on March 1 and September 1 of each year, commencing september 1, 1993. Principal of this Bond is payable at its Stated Maturity or redemption to the registered owner hereof, upon presentation and surrender, at the principal office of the Paying Agent/Registrar executing the registration certificate appearing hereon, or its successor. Interest is payable to the registered owner of this Bond (or one or more Predecessor Bonds, as defined in the resolution hereinafter referenced) whose name appears on the "Security Register" maintained by the paying Agent/Registrar at the close of business on the "Record Date", which is the 15th day of the month next preceding each interest payment date and interest shall be paid by the Paying Agent/Registrar by check sent United States Mail, first class postage prepaid, to the address of the registered owner recorded in the Security Register or by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the registered owner. All payments of principal of, premium, if any, and interest on this Bond shall be without exchange or collection charges to the owner hereof and in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts. This Bond is one of the series specified in its title issued in the aggregate principal amount of $7,500,000 (herein referred to as the "Bonds") to finance the costs of land, buildings, equipment, facilities and improvements suitable for use for amateur (including children's) sports, athletic, entertainment and public park purposes and events, including (i) the construction of phase I of an athletic complex which includes an aquatic and tennis center, (ii) the acquisition of land and its development as soccer and baseball facilities and (iii) the payment of the costs of issuance related to the Bonds, in conformity with the Constitution and laws of the State of Texas, including the Act, and pursuant to an Resolution adopted by the governing body of the Corporation (herein referred to as the "Resolution"). The Bonds maturing on and after September 1, 2003 may be redeemed prior to their stated Maturities, at the option of the corporation, in whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if within a stated Maturity by lot by the Paying Agent/Registrar), on September 1, 2002 or on any date thereafter at the redemption price of par plus accrued interest thereon to the redemption date. At least thirty days 0048171 -9- prior to the date fixed for any redemption of Bonds, the Corporation shall cause a written notice of such redemption to be sent by United states Mail, first class postage prepaid, to the registered owners of each Bond to be redeemed at the address shown on the Security Register and subject to the terms and provisions relating thereto contained in the Resolution. If this Bond (or any portion of the principal sum hereof) shall have been duly called for redemption and notice of such redemption duly given, then upon such redemption date this Bond (or the portion of the principal sum hereof to be redeemed) shall become due and payable, and, if moneys for the payment of the redemption price and the interest accrued on the principal amount to be redeemed to the date of redemption are held for the purpose of such payment by the Paying Agent/Registrar, interest shall cease to accrue and be payable from and after the redemption date on the principal amount hereof redeemed. In the event of a partial redemption of the principal amount of this Bond, payment of the redemption price of such principal amount shall be made to the registered owner only upon presentation and surrender of this Bond to the principal office of the Paying Agent/Registrar, and there shall be issued to the registered owner hereof, without charge, a new Bond or Bonds of like maturity and interest rate in any authorized denominations provided in the Resolution for the then unredeemed balance of the principal sum hereof. If this Bond is called for redemption, in whole or in part, the Corporation and the Paying Agent/Registrar shall not be required to transfer this Bond to an assignee of the Holder within 45 days of the redemption date therefor; provided, however, such limitation on transferability shall not be applicable to an exchange by the Holder of the unredeemed balance hereof in the event of its redemption in part. The Bonds are payable solely from and equally and ratably secured by a pledge of the "Pledged Revenues" (as defined in the Resolution) received by the Corporation, including the receipts from a Sales Tax levied for the benefit of the Corporation pursuant to the Act and an election held in the City. The Bonds do not constitute a legal or equitable, pledge, charge, lien or encumbrance upon any property of the Corporation or the City of North Richland Hills, Texas (the "City") except with respect to the "Pledged Revenues". This Bond may not be paid in whole or in part from any property taxes raised or to be raised by the City and is not a debt of and does not give rise to a claim for payment against the City, except as to the sales and use tax revenues held by the city and required under the Act to be paid over to the Corporation. Neither the State of Texas, the City or any political corporation, subdivision or agency of the state of Texas shall be obligated to pay this Bond or the interest hereon and neither the faith and credit nor the taxing power of the state, the City or any other political corporation, subdivision or agency thereof is pledged to the payment of the principal of and interest on this Bond except as noted above. subject to satisfying the terms and conditions prescribed therefor, the Corporation has reserved the right to issue additional revenue obligations payable, in whole or in part, from the "Pledged Revenues" and equally and ratably secured in like manner and effect as the Bonds. 0048171 -10- Reference is hereby made to the Resolution, a copy of which is on file in the principal office of the Paying Agent/Registrar, and to all of the provisions of which the Holder by the acceptance hereof hereby assents, for definitions of terms; the description of and the nature and extent of the security for the payment of the Bonds; the rights of Holders of the Bonds the terms and conditions for the issuance of additional obligations; the terms and conditions relating to the payment, transfer or exchange of this Bond; the conditions upon which the Resolution may be amended or supplemented with or without the consent of the Holders; the rights, duties, and obligations of the Corporation and the Paying Agent/Registrar; the terms and provisions upon which the encumbrances, pledges, charges and covenants made therein may be discharged; and for the other terms and provisions contained therein. Capitalized terms used herein have the same meanings assigned in the Resolution. This Bond, subject to certain limitations contained in the Resolution, may be transferred on the Security Register only upon its presentation and surrender at the principal office of the Paying Agent/Registrar, with the Assignment hereon duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Paying Agent/Registrar duly executed by, the registered owner hereof, or his duly authorized agent. When a transfer on the Security Register occurs, one or more new fully registered Bonds of the same Stated Maturity, of authorized denominations, bearing the same rate of interest, and of the same aggregate principal amount will be issued by the Paying Agent/Registrar to the designated transferee or transferees. The Corporation and the Paying Agent/Registrar, and any agent of either, may treat the registered owner hereof whose name appears on the Security Register (i) on the Record Date as the owner entitled to payment of interest hereon, (ii) on the date of surrender of this Bond as the owner entitled to payment of principal hereof at its Stated Maturity or its redemption, in whole or in part, and (iii) on any other date as the owner for all other purposes, and neither the Corporation nor the Paying Agent/Registrar, or any agent of either, shall be affected by notice to the contrary. In the event of non-payment of interest on a scheduled payment date and for thirty (30) days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the Corporation. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date by United States Mail, first class postage prepaid, to the address of each Holder appearing on the Security Register at the close of business on the last business day next preceding the date of mailing of such notice. 0048171 -11- It is hereby certified, recited, represented and covenanted that the Corporation is a non-profit industrial development corporation duly organized and legally existing under and by virtue of the Constitution and laws of the state of Texas, including the Act; that all acts, conditions and things required to exist and be done precedent to and in the issuance of the Bonds to render the same lawful and valid special obligations of the Corporation have been properly done, have happened and have been performed in regular and due time, form and manner as required by law; and that due provision has been made for the payment of the principal of and interest on the Bonds from the sources and in the manner provided in the Resolution. In case any provision in this Bond or any application thereof shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions and applications shall not in any way be affected or impaired thereby. The terms and provisions of this Bond and the Resolution shall be construed in accordance with and shall be governed by the laws of the state of Texas. IN WITNESS WHEREOF, the Board of Directors of the Corporation has caused this Bond to be duly executed under the official seal of the Corporation as of the Issue Date. NORTH RICHLAND HILLS PARK AND RECREATION FACILITIES DEVELOPMENT CORPORATION ATTEST: President OR Chairman of the Board of Directors Secretary (SEAL) 0048171 -12- C. *Form of Registration Certificate of Comptroller of Public Accounts to Aopear on Initial Bonds only. REGISTRATION CERTIFICATE OF COMPTROLLER OF PUBLIC ACCOUNTS OF PUBLIC ACCOUNTS ) ) ) ) ) OFFICE OF THE COMPTROLLER REGISTER NO. THE STATE OF TEXAS I HEREBY CERTIFY that this Bond has been examined, certified as to validity and approved by the Attorney General of the state of Texas, and duly registered by the Comptroller of Public Accounts of the State of Texas. WITNESS my signature and seal of office this (SEAL) Comptroller of Public Accounts of the state of Texas D. Form of certificate of Paying Agent/Registrar to Aooear on definitive Bonds. REGISTRATION CERTIFICATE OF PAYING AGENT/REGISTRAR This Bond has been duly issued and registered in the name of the Registered Owner shown above under the provisions of the within-mentioned Resolution and duly approved, or a Predecessor Bond hereof duly approved, by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts, as shown by the records of the Paying Agent/Registrar. Team Bank, Fort Texas as Agent/Registrar Worth, Paying Registration date: By Authorized Signature 0048171 -13- E. Form of Assianment. ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns, and transfers unto (Print or typewrite name, address, and zip code of transferee:) (Social Security or other identifying number: ) the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints attorney to transfer the within Bond on the books kept for registration thereof, with full power of substitution in the premises. DATED: Signature guaranteed: NOTICE: The signature on this assignment must correspond with the name of the registered owner as it appears on the face of the within Bond in every particular. F. The Initial Bond(s) shall be in the form set forth in paragraph B of this section. except that the form of a single fully reaistered Initial Bond shall be modified as follows:: (i) immediately under the name of the bond the headings "Interest Rate " and "Stated Maturity " shall both be omitted;" (ii) Paragraph one shall read as follows: The North Richland Hills Park and Recreation Facilities Development Corporation (hereinafter referred to as the "Corporation"), a non-profit industrial development corporation organized and existing under the laws of the State of Texas, including section 4B of Article 5190.6, Tex. Rev. civ. st. Ann., as amended, (the "Act"), with its principal office located in Tarrant County, Texas, for value received, hereby promises to pay to the order of the Registered Owner named above, or the registered assigns thereof, solely from the revenues and sources pledged under the Resolution identified below, the Principal Amount hereinabove stated on September 1 in each of the years and in principal amounts and bearing interest at per annum rates in accordance with the following schedule: YEAR PRINCIPAL INSTALLMENTS INTEREST RATE (Information to be inserted from schedule in Section 2 hereof). 0048171 -14- (or so much thereof as shall not have been paid upon prior redemption) and to pay interest (computed on the basis of a 360-day year of twelve 30-day months) on the unpaid Principal Amount hereof from the Issue Date at the per annum rate of interest specified above; such interest being payable on March 1 and September 1 of each year, commencing september 1, 1993. Principal installments of this Bond are payable at its Stated Maturity or on a prepayment date to the registered owner hereof, upon its presentation and surrender, at the principal offices of Team Bank, Fort Worth, Texas (the "Paying Agent/Registrar"). Interest is payable to the registered owner of this Bond (or one or more Predecessor Bonds, as defined in the resolution hereinafter referenced) whose name appears on the "Security Register" maintained by the Paying Agent/Registrar at the close of business on the "Record Date", which is the 15th day of the month next preceding each interest payment date and interest shall be paid by the Paying Agent/Registrar by check sent united states Mail, first class postage prepaid, to the address of the registered owner recorded in the Security Register or by such other method, acceptable to the Paying-Agent/Registrar, requested by, and at the risk and expense of, the registered owner. All payments of principal of, premium, if any, and interest on this Bond shall be without exchange or collection charges to the owner hereof and in any coin or currency of the united States of America which at the time of payment is legal tender for the payment of public and private debts. SECTION 10. Definitions. For all purposes of this Resolution and in particular for clarity with respect to the issuance of the Bonds herein authorized and the pledge and appropriation of revenues to the payment of the Bonds, the following definitions are provided: "Act" - The Development Corporation Act of 1979, Vernon's Ann. civ.st. Art. 5190.6, as amended at any time. "Additional Obligations" - Bonds, notes or other evidences of indebtedness which the Corporation reserves the right to issue or enter into, as the case may be, in the future in accordance with the terms and conditions provided in section 18 hereof and which, together with the Bonds, are equally and ratably secured by a parity pledge of and claim on the Pledged Revenues under the terms of this Resolution and a Supplemental Resolution. "Average Annual Debt Service" - That amount which, at the time of computation, is derived by dividing the total amount of Debt Service to be paid over a period of years as the same is scheduled to become due and payable by the number of years taken into account in determining the total Debt Service. capitalized interest payments provided from proceeds or borrowings of the Corporation 0048171 -15- shall be excluded in making the aforementioned computation. "Board" - The Board of Directors of the Corporation. "Bonds" - The "North Richland Hills Park and Recreation Facilities Development Corporation Sales Tax Revenue Bonds, Series 1992 ", dated November 15, 1992, authorized by this Resolution. "city" - The City of North Richland Hills, Texas. "Corporation" - The North Richland Hills Park and Recreation Facilities Development Corporation, a non-profit industrial development corporation organized and existing under and pursuant to the laws of the state of Texas, including section 4B of the Act, with its principal place of business in Tarrant County, Texas. "Debt Service" - As of any particular date of computation, with respect to any obligations and with respect to any period, the aggregate of the amounts to be paid or set aside by the corporation as of such date or in such period for the payment of the principal of, premium, if any, and interest (to the extent not capitalized) on such obligations; assuming, in the case of obligations without a fixed numerical rate, that such obligations bear, or would have borne, interest at the maximum legal per annum rate applicable to such obligations, and further assuming in the case of obligations required to be redeemed or prepaid as to principal prior to maturity, the principal amounts thereof will be redeemed prior to maturity in accordance with the mandatory redemption provisions applicable thereto. "Depository" - A commercial bank or other qualified financial institution eligible and qualified to serve as the custodian of the Corporation's monetary accounts and funds. "Fiscal Year" - The twelve month financial accounting per~od used by the Corporation ending September 30 1n each year, or such other twelve consecutive month period established by the Corporation. "Government obligations" - Direct obligations of the united States of America, including obligations the principal of and interest on which are fully and 0048171 -16- 0048171 unconditionally guaranteed by the united states of America. "Gross Sales Tax Revenues" - All of the revenues or receipts due or owing to, or collected or received by or on behalf of the Corporation by the City or otherwise pursuant to section 4B of the Act and the election held August 8, 1992, less any amounts due and owed to the Comptroller of Public Accounts of the state of Texas as charges for the collection of the Sales Tax or retention by said Comptroller for refunds and to redeem dishonored checks and drafts, to the extent such charges and retention are authorized or required by law. "outstanding" - When used in this Resolution with respect to Bonds or Parity Bonds, as the case may be, means, as of the date of determination, all Bonds and Parity Bonds theretofore sold, issued and delivered by the Corporation, except: (1) those Bonds or Parity Bonds canceled or delivered to the transfer agent or registrar for cancellation in connection with the exchange or transfer of such obligations; (2) those Bonds or Parity Bonds paid or deemed to be paid in accordance with the provisions of Section 25 hereof or similar provisions of any Supplemental Resolution authorizing the issuance of Additional Bonds. (3) those Bonds or Par i ty Bonds that have been mutilated, destroyed, lost, or stolen and replacement obligations have been registered and delivered in lieu thereof. "Parity Bonds" - Collectively, Additional Obligations. the Bonds and "Pledged Revenues" Collectively (i) Gross Sales Tax Revenues from time to time deposited or owing to the Pledged Revenue Fund and (ii) such other money, income, revenue, receipts or other property as may be specifically dedicated, pledged or otherwise encumbered in a supplemental Resolution for the payment and security of Parity Bonds. "Required Reserve" - The amount required to be accumulated and maintained in the Reserve Fund under the provisions of section 15 hereof. "Sales Tax" - The local sales and use tax authorized under Section 4B of the Act , approved at an election held on August 8, 1992, and the effective date for the -17- imposition and application of such Sales Tax within the corporate limits of the City by the Comptroller of Public Accounts of the state of Texas being January 1, 1993, together with any increases in the rate of such Sales Tax authorized and provided by law. "Supplemental Resolution" - Any resolution of the Board supplementing this Resolution for the purpose of authorizing and providing the terms and provisions of the Bonds or Additional Obligations, or supplementing or amending this Resolution for any other authorized purpose permitted in Section 18 or 25 hereof, including resolutions authorizing the issuance of Additional Obligations or pledging and encumbering income, revenues, receipts or property other than the Gross Sales Tax Revenues to the payment and security of the Parity Bonds. SECTION 11. Pledae. The Corporation hereby covenants and agrees that the Pledged Revenues, with the exception of those in excess of the amounts required for the payment and security of the Parity Bonds, are hereby irrevocably pledged to the payment and security of the Bonds and Additional Obligations, if issued, including the establishment and maintenance of the special funds created and established in this Resolution and any Supplemental Resolution, all as hereinafter provided. The Corporation hereby resolves the parity Bonds shall constitute a lien on the Pledged Revenues in accordance with the terms of this Resolution and any Supplemental Resolution, which lien shall be valid and binding wi thout any further action by the corporation and without any filing or recording with respect thereto except in the records of the Corporation. SECTION 12. Pledged Revenue Fund. The corporation hereby agrees and covenants to establish and maintain a fund or account at a Depository for the deposit of the Pledged Revenues as received and collected by the Corporation, which fund or account shall be known on the books and records of the corporation as the "Pledged Revenue Fund". All Pledged Revenues deposited to the credit of such Fund shall be accounted for separate and apart from all other revenues, receipts and income of the Corporation and, with respect to the Gross Sales Tax Revenues, the Corporation shall further account for such funds separate and apart from the other Pledged Revenues deposited to the credit of the Pledged Revenue Fund. All Pledged Revenues deposited to the credit of the Pledged Revenue Fund shall be appropriated and expended to the extent required by this Resolution and any Supplemental Resolution for the following uses and in the order of priority shown: First: To the payment of the amounts required to be deposited in the Bond Fund for the payment of Debt Service on the Parity Bonds as the same becomes due and payable. 0048171 -18- Second: To the payment of the amounts required to be deposited in the Reserve Fund to establish and maintain the Required Reserve in accordance with the provisions of this Resolution and any Supplemental Resolution. Third: To the payment of amounts required to be deposited in any other fund or account required by any Supplemental Resolution authorizing the issuance of Parity Bonds; and Fourth: To any fund or account held at any place or places, or to any payee, required by any other resolution of the Board which authorized the issuance of obligations or the creation of debt of the Corporation having a lien on the Pledged Revenues subordinate to the lien created herein on behalf of the Parity Bonds. Any Pledged Revenues remaining in the Pledged Revenue Fund after satisfying the foregoing payments, or making adequate and sufficient provision for the payment thereof, may be appropriated and used for any other lawful purpose now or hereafter permitted by law. SECTION 13. Bond Fund. For the purpose of providing funds to pay the principal of and interest on Parity Bonds, the Corporation agrees and covenants to maintain a separate and special account or fund on the books and records of the Corporation known as the "NRH Park and Recreation Facilities Development Corp. Debt Service Account" (the "Bond Fund"), and all monies deposited to the credit of such Fund shall be held in a special banking fund or account maintained at a Depository of the Corporation. The Corporation covenants that there shall be deposited into the Bond Fund prior to each principal and interest payment date from the Pledged Revenues an amount equal to one hundred per centum (100%) of the interest on and the principal of the Bonds then falling due and payable, and such deposits to pay principal and accrued interest on the Bonds shall be made in substantially equal monthly installments on or before the 20th day of each month, beginning on or before the 20th day of the month next following the delivery of the Bonds to the initial purchasers. The required deposits to the Bond Fund for the payment of principal of and interest on the Bonds shall continue to be made as hereinabove provided until (i) the total amount on deposit in the Bond Fund and Reserve Fund is equal to the amount required to fully pay and discharge all Parity Bonds (principal and interest) then Outstanding or (ii) the Bonds are no longer Outstanding. SECTION 14. Reserve Fund. The Corporation agrees and covenants to maintain on the books and records of the Corporation a separate and special fund or account to be known as the "Reserve Account" (the "Reserve Fund"), which fund or account shall be a 0048171 -19- special banking fund maintained at a Depository. All Pledged Revenues deposited to the credit of such fund or account shall be used solely for the payment of the principal of and interest on the Parity Bonds when (whether at maturity, upon a redemption date or any interest payment date) other funds available for such purposes are insufficient, and, in addition, may be used to the extent not required to maintain the "Required Reserve", to pay, or provide for the payment of, the final principal amount of a series of Parity Bonds so that such series of Parity Bonds is no longer deemed to be "Outstanding" as such term is defined herein. The total amount to be accumulated and maintained in the Reserve Fund by reason of the issuance of the Bonds shall be $675,000 (the "Required Reserve"), and immediately following the delivery of the Bonds to the initial purchasers, there shall be deposited to the credit of the Reserve Fund from the proceeds of sale of the Bonds the sum of $675,000 (the "Initial Deposit"). Beginning on or before the 20th day of the month next following the month the Bonds are delivered to the initial purchasers and on or before the 20th day of each following month, the Corporation agrees that there shall cause to be deposited to the Reserve Fund from the Pledged Revenues an amount equal to at least one-thirty-sixth (1/36th) of the difference between the Required Reserve and the Initial Deposit. After the Required Reserve has been fully accumulated and while Required Reserve is maintained on deposit in such Fund, no further monthly deposits shall be required to be made to the Reserve Fund. As and when Additional Obligations are delivered or incurred, the Required Reserve shall be increased, if required, to an amount equal to the Average Annual Debt Service (calculated on a Fiscal Year basis) for all parity Bonds then Outstanding (after giving effect to the issuance of the Additional Obligations), as determined on the date each series of Additional Obligations are delivered or incurred, as the case may be. Any additional amount required to be accumulated and maintained in the Reserve Fund shall be deposited in full to the credit of the Reserve Fund in cash immediately after the deli very of the then proposed Additional Obligations. While the cash and investments in the Reserve Fund total not less than the Required Reserve, no deposits need be made to the credit of the Reserve Fund; but, if and when the Reserve Fund at any time contains less than the Required Reserve , the Corporation covenants and agrees to cure the deficiency in the Required Reserve by resuming monthly deposits to said Fund from the Pledged Revenues; such monthly deposits to be in amounts equal to not less than 1/36th of the then total Required Reserve to be maintained in said Fund and to be made on or before the 20th day of each month until the total Required Reserve then required to be maintained in said Fund has been fully restored. The Corporation further covenants and agrees that the Pledged Revenues shall be applied and appropriated and used to establish and maintain the Required 0048171 -20- Reserve and to cure any deficiency in such amounts as required by the terms of this Resolution and any Supplemental Resolution. During such time as the Reserve Fund contains the total Required Reserve, the Corporation may, at its option, withdraw all surplus in the Reserve Fund in excess of the Required Reserve and deposit such surplus in the Pledged Revenue Fund. SECTION 15. Deficiencies. If on any occasion there shall not be sufficient Pledged Revenues to make the required deposits into the Bond Fund or Reserve Fund, such deficiency shall be cured as soon as possible from the next available Pledged Revenues, or from any other sources available for such purpose. SECTION 16. Payment of Bonds. While any of the Bonds are Outstanding, the Treasurer of the Corporation (or other designated financial officer of the Corporation) shall cause to be transferred to the Paying Agent/Registrar, from funds on deposit in the Bond Fund, and, if necessary, in the Reserve Fund, amounts sufficient to fully pay and discharge promptly as each installment of interest and principal of the Bonds accrues or matures; such transfer of funds to be made in such manner as will cause immediately available funds to be deposited with the Paying Agent/Registrar for the Bonds at the close of the business day next preceding the date of payment for the Bonds. SECTION 17. Investments - Security of Funds. (a) Money in any Fund required to be maintained pursuant to this Resolution may, at the option of the Corporation, be invested in obligations and in the manner prescribed by the Public Funds Investment Act of 1987 (Article 842a-2, Vernon's Texas Revised Civil statutes Annotated), including investments held in book-entry form; provided that all such deposits and investments shall be made in such a manner that the money required to be expended from any Fund will be available at the proper time or times and provided further the maximum stated maturity for any investment acquired with money deposited to the credit of the Reserve Fund shall be limited to five (5) years from the date of the investment of such money. Such investments shall be valued in terms of current market value within 45 days of the close of each Fiscal Year and, with respect to investments held for the account of the Reserve Fund, wi thin 45 days of the date of passage of each authorizing document of the Board pertaining to the issuance of Additional Obligations. All interest and income derived from deposits and investments in the Bond Fund immediately shall be credited to, and any losses debited to, the appropriate account of the Bond Fund. All interest and interest income derived from deposits in and investments of the Reserve Fund shall, subject to the limitations provided in section 15 hereof, be credited to and deposited in the Pledged Revenue Fund. All such investments shall be sold promptly when necessary to prevent any default in connection with the Bonds. 0048171 -21- (b) That money deposited to the credit of the Pledged Revenue Fund, Bond Fund and Reserve Fund, to the extent not invested and not otherwise insured by the Federal Deposit Insurance Corporation or similar agency, shall be secured by a pledge of direct obligations of the United states of America, or obligations unconditionally guaranteed by the united states of America. SECTION 18. Issuance of Additional Parity Obliaations. Subject to the provisions hereinafter appearing as to conditions precedent which must be satisfied, the Corporation reserves the right to issue, from time to time as needed, Additional Obligations for any lawful purpose. Such Additional Obligations may be issued in such form and manner as the Corporation shall determine, provided, however, prior to issuing or incurring such Additional Obligations, the following conditions precedent for the authorization and issuance of the same are satisfied, to wit: (1) The Treasurer of the Corporation (or other officer of the Corporation then having the primary responsibility for the financial affairs of the Corporation) shall have executed a certificate stating that, to the best of his or her knowledge and belief, the Corporation is not then in default as to any covenant, obligation or agreement contained in the Resolution or a Supplemental Resolution. (2) The Corporation has secured from a certified public accountant a certificate or opinion to the effect that, according to the books and records of the Corporation, the Gross Sales Tax Revenues received by the Corporation during any twelve (12) consecutive months out of the previous eighteen (18) months next preceding the adoption of the Supplemental Resolution authorizing the Additional Obligations were equal to not less than 1.50 multiplied by the Average Annual Debt Service during such twel ve consecuti ve month per iod with respect to the Parity Bonds then outstanding and after giving effect to the issuance of the Additional Obligations then being issued. Additionally, for the purpose of providing this certificate or opinion, if the Corporation shall not have received Gross Sales Tax Revenues for a full 12 month period, one-half of the amount of sales tax revenues actually received by the City under Chapter 321, TEX.TAX CODE, may be used for the months during which the Corporation did not receive Gross Sales Tax Revenues. (3) The Required Reserve to be accumulated and maintained in the Reserve Fund is increased to the extent required by Section 15. SECTION 19. Refunding Bonds. The Corporation reserves the right to issue refunding bonds to refund all or any part of the Parity Bond~ (pursuant to any law then available) upon such terms 0048171 -22- and conditions as the Board may deem to be in the best interest of the Corporation, and if less than all such Parity Bonds then outstanding are refunded, the conditions precedent prescribed (for the issuance of Additional Bonds) set forth in Section 19 hereof shall be satisfied, and shall give effect to the refunding. SECTION 20. Riaht to Create Subordinate Debt. Except as may be limited by a Supplemental Resolution, the Corporation shall have the right to issue or create any debt payable from or secured by a lien on all or any part of the Pledged Revenues for any lawful purpose without complying with the provisions of section 18 or 19 hereof, provide the pledge and the lien thereof is subordinate to the pledge and lien established, made and created in Section 11 of this Resolution with respect to the Pledged Revenues to the payment and security of the Parity Bonds. SECTION 21. Confirmation and Levy of Sales Tax. (a) The Board hereby confirms the earlier levy by the City of the Sales Tax at the rate voted at the election held by and within the City on August 8, 1992, and the Board hereby warrants and represents that the City has duly and lawfully ordered the imposition and collection of the Sales Tax upon all sales, uses and transactions as are permitted by and described in Section 4B of the Act throughout the boundaries of the City as such boundaries existed on the date of said election and as they may be expanded from time to time. (b) While any Bonds are Outstanding, the Corporation covenants, agrees and warrants to take and pursue all action permissible to cause the Sales Tax, at said rate or at a higher rate if legally permitted, to be levied and collected continuously, in the manner and to the maximum extent permitted by law, and to cause no reduction, abatement or exemption in the Sales Tax or rate of tax below the rate stated, confirmed and ordered in subsection (a) of this Section to be ordered or permitted while any Bonds shall remain Outstanding. (c) If the City shall be hereafter authorized by law to apply, impose and levy the Sales Tax on any taxable items or transactions that are not subject to the Sales Tax on the date of the adoption hereof, to the extent it legally may do so, the Corporation hereby covenants and agrees to use its best efforts to cause the City to take such action as may be required to subject such taxable items or transactions to the Sales Tax. (d) The Corporation agrees to take and pursue all action legally permissible to cause the Sales Tax to be collected and remitted and deposited as herein required and as required by Section 4B of the Act, at the earliest and most frequent times permitted by law. 0048171 -23- (e) The Corporation agrees and covenants at all times, and to use its best efforts to cause the City, to comply with Section 4B of the Act or in the alternative, shall, by appropriate notice, direction, request or other legal method, use its good-faith efforts to cause the Comptroller of Public Accounts of the State of Texas (the "Comptroller") to pay all Gross Sales Tax Revenues directly to the Corporation for deposit to the Pledged Revenue Fund. If the Comptroller shall refuse or shall not be legally obligated to make transfers in accordance with such notice, direction or request, then the Corporation shall cause the Gross Sales Tax Revenues to be deposited to the credit of the Pledged Revenue Fund in their entirety immediately upon receipt thereof by the city. SECTION 22. Records and Accounts. The Corporation hereby covenants and agrees that while any of the Bonds are Outstanding, it will keep and maintain complete records and accounts in accordance with generally accepted accounting principles, and following the close of each Fiscal Year, it will cause an audit of such books and accounts to be made by an independent firm of certified public accountants. Each such audit, in addition to whatever other matters may be thought proper by the accountant, shall particularly include the following: (1) A statement in reasonable detail regarding the receipt and disbursement of the Pledged Revenues for such Fiscal Year; and (2) A balance sheet for the Corporation as of the end of such Fiscal Year. Such annual audit of the records and accounts of the corporation shall be in the form of a report and be accompanied by an opinion of the accountant to the effect that such examination was made in accordance with generally accepted auditing standards and contain a statement to the effect that in the course of making the examination necessary for the report and opinion, the accountant obtained no knowledge of any default of the Corporation on the Bonds or in the fulfillment of any of the terms, covenants or provisions of this Resolution, or under any other evidence of indebtedness, or of any event which, with notice or lapse of time, or both, would constitute a failure of the Corporation to comply with the provisions of this Resolution or if, in the opinion of the accountants, any such failure to comply with a covenant or agreement hereof, a statement as to the nature and status thereof shall be included. Copies of each annual audit report shall be furnished upon written request, to any Holders of any of said Bonds. The audits herein required shall be made within 120 days following the close of each Fiscal Year insofar as is possible. 0048171 -24- The Holders of any Bonds or any duly authorized agent or agents of such Holders shall have the right to inspect such records, accounts and data of the Corporation during regular business hours. SECTION 23. Representations as to Security for the Bonds. (a) The corporation represents and warrants that, except for the Parity Bonds, the Pledged Revenues are and will be and remain free and clear of any pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or of equal rank with, the pledge and lien created in or authorized by this Resolution except as expressly provided herein. (b) The Bonds and the provisions of this Resolution are and will be the valid and legally enforceable obligations of the Corporation in accordance with their terms and the terms of this Resolution, subject only to any applicable bankruptcy or insolvency laws or to any laws affecting creditors rights generally. (c) The Corporation shall at all times, to the extent permitted by law, defend, preserve and protect the pledge of the Pledged Revenues and all the rights of the Holders against all claims and demands ot all persons whomsoever. (d) The Corporation will take, and use its best efforts to cause the City to take, all steps reasonably necessary and appropriate to collect all delinquencies ,in the collection of the Sales Tax to the fullest extent permitted by the Act. (e) The provisions, covenants, pledge and lien on and against the Pledged Revenues, as herein set forth, are established and shall be for the equal benefit, protection and security of the owners and holders of Parity Bonds without distinction as to priority and rights under this Resolution. (f) The parity Bonds shall constitute special obligations of the Corporation, payable solely from, and equally and ratably secured by a parity pledge of and lien on, the Pledged Revenues, and not from any other revenues, properties or income of the corporation. The Bonds may not be paid in whole or in part from any property taxes raised or to be raised by the City and shall not constitute debts or obligations of the State or of the City, and the Holders, shall never have the right to demand payment out of any funds raised or to be raised by any system of ad valorem taxation. SECTION 24. satisfaction of Obliaation of CorDoration. If the Corporation shall payor cause to be paid, or there shall otherwise be paid to the Holders, the principal of, premium, if any, and interest on the Bonds, at the times and in the manner stipulated in this Resolution, then the pledge of the Pledged Revenues under this Resolution and all other obligations of the Corporation to the Holders shall thereupon cease, terminate, and become void and be discharged and satisfied. 0048171 -25- Bonds or any principal amount(s) shall be deemed to have been paid within the meaning and with the effect expressed above in this section when (i) money sufficient to pay in full such Bonds at maturity or to the redemption date therefor, together with all interest due thereon, shall have been irrevocably deposited with and held in trust by the paying Agent/Registrar, or an authorized escrow agent, or (ii) Government Obligations shall have been irrevocably deposited in trust with the Paying Agent/Registrar, or an authorized escrow agent, which Government Obligations have been certified by an independent accounting firm to mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money, together with any moneys deposited therewith, if any, to pay when due the Bonds on the stated Maturities thereof or (if notice of redemption has been duly given or waived or if irrevocable arrangements therefor accepted to the Paying Agent/Registrar have been made) the redemption date thereof. The Corporation covenants that no deposit of moneys or Government Obligations will be made under this section and no use made of any such deposit which would cause the Bonds to be treated as "arbitrage bonds" within the meaning of section 148 of the Internal Revenue Code of 1986, as amended, or regulations adopted pursuant thereto. Any moneys so deposited with the Paying Agent/ Registrar, or an authorized escrow agent, and all income from Government Obligations held in trust by the Paying Agent/Registrar, or an authorized escrow agent, pursuant to this section in excess of the amount required for the payment of the Bonds shall be remitted to the District or deposited as directed by the District. Furthermore, any money held by the Paying Agent/Registrar for the payment of the principal of and interest on the Bonds and remaining unclaimed for a period of four (4) years after the Stated Maturity, or applicable redemption date, of the Bonds such moneys were deposited and are held in trust to pay shall, upon the request of the Corporation, be remitted to the Corporation against a written receipt therefor. Notwithstanding the above and foregoing, any remittance of funds from the Paying Agent/Registrar to the corporation shall be subject to any applicable unclaimed property laws of the State of Texas. SECTION 25. Resolution a Contract - Amendments. This Resolution shall constitute a contract with the Holders from time to time, be binding on the Corporation, and shall not be amended or repealed by the Corporation while any Bond remains outstanding except as permitted in this section. The Corporation, may, without the consent of or notice to any Holders, from time to time and at any time, amend this Resolution in any manner not detrimental to the interests of the Holders, including the curing of any ambiguity, inconsistency, or formal defect or omission herein. In addition, the corporation may, with the written consent from the owners holding a majority in aggregate principal amount of the Parity Bonds then outstanding affected thereby, amend, add to, or rescind any of the provisions of this Resolution; provided that, 0048171 -26- without the written consent of all Holders of outstanding Bonds effected, no such amendment, addition, or rescission shall (1) extend the time or times of payment of the principal of, premium, if any, and interest on the Bonds, reduce the principal amount thereof, the redemption price therefor, or the rate of interest thereon, or in any other way modify the terms of payment of the principal of, premium, if any, or interest on the Bonds, ( 2 ) give any pref erence to any Bond over any other Bond, or (3) reduce the aggregate principal amount of Bonds or Parity Bonds, as the case may be, required to be held for consent to any such amendment, addition, or rescission. SECTION 26. Mutilated - Destroyed - Lost and Stolen Bonds. In case any Bond shall be mutilated, or destroyed, lost or stolen, the Paying Agent/Registrar may execute and deliver a replacement Bond of like form and tenor, and in the same denomination and bearing a number not contemporaneously outstanding, in exchange and substitution for such mutilated Bond, or in lieu of and in substitution for such destroyed, lost or stolen Bond, only upon the approval of the Corporation and after (i) the filing by the Holder thereof with the Paying Agent/Registrar of evidence satisfactory to the Paying Agent/Registrar of the destruction, loss or theft of such Bond, and of the authenticity of the ownership thereof and (ii) the furnishing to the Paying Agent/Registrar of indemnification in an amount satisfactory to hold the Corporation and the Paying Agent/Registrar harmless. All expenses and charges associated with such indemnity and with the preparation, execution and delivery of a replacement Bond shall be borne by the Holder of the Bond mutilated, or destroyed, lost or stolen. Every new Bond issued pursuant to this section in lieu of any mutilated, destroyed, lost, or stolen Bond shall constitute a replacement of the prior obligation of the Corporation, whether or not the mutilated, destroyed, lost, or stolen Bond shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Resolution equally and ratably with all other outstanding Bonds. SECTION 27. Covenants Reaardina Tax-Exempt Status. (a) Definitions. When used in this section 27, the following terms have the following meanings: "Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any, enacted on or before the Issue Date. "Computation Date" has the meaning stated in Treas. Reg. § 1.148-8(b) (1). "Gross Proceeds" has the meaning stated in Treas. Reg. § 1.148-8(d). 0048171 -27- "Investment" has the meaning stated in Treas. Reg. S 1.148-8(e). "Issue Date" means the date on which the Bonds are first authenticated and delivered to the initial purchasers against payment therefor. "Nonpurpose Investment" means any Investment in which Gross Proceeds of the Bonds are invested and which is not acquired to carry out the governmental purpose of the Bonds. Obligations acquired with proceeds of the Bonds that are to be used to discharge the Refunded Bonds are Nonpurpose Investments. "Rebatable Arbitrage" has the meaning stated in Treas. Reg. § 1.148-2. "Yield of" (1) any Investment shall be computed in accordance with Treas. Reg. §1.148-2, and (2) the Bonds has the meaning stated in Treas. Reg. § 1.148-3. (b) Not to Cause Interest to Become Taxable. The Corporation shall not use, permit the use of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition, construction, or improvement of which is to be financed directly or indirectly with Gross Proceeds) in a manner which, if made or omitted, respectively, would cause the interest on any Bond to become includable in the gross income, as defined in section 61 of the Code, of the owner thereof for federal income tax purposes. without limiting the generality of the foregoing, unless and until the Corporation shall have received a written opinion of counsel nationally recognized in the field of municipal bond law to the effect that failure to comply with such covenant will not adversely affect the exclusion of interest on any Bond from gross income for federal income tax purposes pursuant to Section 103 of the Code, the Corporation shall comply with each of the specific covenants in this section. (c) No Private Use or Private Payments. The Bonds are being issued to finance the costs of the Project for on behalf of the City, a political subdivision of the state of Texas, and in connection therewith, the city and the corporation will execute an agreement relating to the ownership, operation and maintenance of the project while the Bonds are outstanding and unpaid, which agreement provides that, except as permitted by section 141 of the Code and the regulations and rulings thereunder, the land to be acquired with the issuance of the Bonds shall at all times prior to the last maturity of the Bond: 0048171 -28- -----' (1) be exclusively owned, operated and maintained by the city, and prohibits the City from using or permi tting the use of such Gross Proceeds or any property acquired, constructed, or improved with such Gross Proceeds in any activity carried on by any person or entity other than a state or local government, unless such use is solely as a member of the general public, and (2) prohibits the city from directly or indirectly imposing or accepting any charge or other payment for use of Gross Proceeds of the Bonds or for any property acquired, constructed, or improved indirectly with such Gross Proceeds, other than taxes of general application within the city or interest earned on investments acquired with such Gross Proceeds pending application for their intended purposes. (d) No Private Loan. Except to the extent permitted by section 141 of the Code and the regulations and rulings thereunder, the Corporation shall not use Gross Proceeds of the Bonds to make or finance loans to any person or entity other than a state or local government. For purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a person or entity if (1) property acquired, constructed, or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction which creates a debt for federal income tax purposes, (2) capacity in or service from such property is committed to such person or entity under a take-or-pay, output, or similar contract or arrangement, or (3) indirect benefits, or burdens and benefits of ownership, of such Gross Proceeds or any property acquired, constructed, or improved with such Gross Proceeds are otherwise transferred in a transaction which is the economic equivalent of a loan. (e) Not to Invest at Hiaher Yield. Except to the extent permitted by section 148 of the Code and the regulations and rulings thereunder, the Corporation shall not, at any time prior to the final stated Maturity of the Bonds, directly or indirectly invest Gross Proceeds of the Bonds in any Investment (or use such Gross Proceeds to replace money so invested), if as a result of such investment the Yield of all Investments allocated to such Gross Proceeds whether then held or previously disposed of, exceeds the Yield of the Bonds. (f) Not FederallY Guaranteed. Except to the extent permitted by section 149 (b) of the Code and the regulations and rulings thereunder, the Corporation shall not take or omit to take any action which would cause the Bonds to be federally guaranteed within the meaning of section 149(b) of the Code and the regulations and rulings thereunder. (g) Information Report. The corporation shall timely file with the Secretary of the Treasury the information required by 0048171 -29- section 149(e) of the Code with respect to the Bonds on such form and in such place as such Secretary may prescribe. (h) Payment of Rebatable Arbitraae. Except to the extent otherwise provided in section 148(f) of the Code and the regulations and rulings thereunder, (1) The Corporation and the City shall account for all Gross Proceeds of the Bonds (including all receipts, expenditures, and investments thereof) on their respective books of account separately and apart from all other funds (and receipts, expenditures, and investments thereof) and shall maintain all records of such accounting with other public records relating to the issuance of the Bonds until six years after the final computation Date. The Corporation may, however, to the extent permitted by section 148(f) of the Code and the regulations thereunder, commingle Gross Proceeds of the Bonds with other money of the Corporation, provided that the corporation separately accounts for each receipt and expenditure of such Gross Proceeds and the obligations acquired therewith. (2) Not less frequently than each computation Date, the corporation shall either (i) cause to be calculated by a nationally recognized accounting or financial advisory firm or (ii) calculate and cause its calculations to be verified by a nationally recognized accounting or financial advisory firm, in either case in accordance with rules set forth in section 148(f) of the Code and Treas. Reg. § 1.148-2 and rulings thereunder, the Rebatable Arbitrage with respect to the Bonds. The corporation shall maintain such calculations relating to the issuance of the Bonds until six years after the final computation Date. (3) As additional consideration for the issuance of the Bonds by the initial purchasers and the loan represented thereby, and in order to induce such purchase by measures designed to result in the excludability of the interest thereon from the gross income of the owners thereof for federal income tax purposes, the Corporation shall pay to the united States the amount described in paragraph (2) above and the amount described in paragraph (4) below, at the times, in the installments, to the place, in the manner, and accompanied by such forms or other information as is or may be required by section 148 (f) of the Code and Treas. Reg. §§ 1.148-1 through 1.148-9 and rulings thereunder. (4) The Corporation shall exercise reasonable diligence to assure that no errors are made in the calculations required by paragraph (2) and, if such error 0048171 -30- is made, to discover and promptly to correct such error within a reasonable amount of time thereafter, including payment to the united states of any Correction Amount as described in Treas. Reg. § 1.148-1(c) (2) and any penalty under Treas. Reg. § 1.148-1(c) (3) (ii) (B). (5) The Corporation shall not, at any time prior to the earlier of the Stated Maturity or final payment of the Bonds, enter into any transaction that reduces the amount required to be paid to the united states pursuant to this subsection (h) because such transaction results in a smaller prof it or a larger loss than would have resulted if the transaction had been at arm's length and had the Yield of the Bonds not been relevant to either party. SECTION 28. Notices to Holders - Waiver. Wherever this Resolution provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and sent by united states Mail, first class postage prepaid, to the address of each Holder as it appears in the security Register. In any case where notice to Holders is given by mail, neither the failure to mail such notice to any particular Holders, nor any defect in any notice so mailed, shall affect the sufficiency of such notice with respect to all other Bonds. Where this Resolution provides for notice in any manner, such notice may be waived in writing by the Holder entitled to receive such notice, either before or after the event with respect to which such notice is given, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Paying Agent/Registrar, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. SECTION 29. Cancellation. All Bonds surrendered for payment, redemption, transfer or exchange, if surrendered to the Paying Agent/Registrar, shall be promptly canceled by it and, if surrendered to the Corporation, shall be delivered to the Paying Agent/Registrar and, if not already canceled, shall be promptly canceled by the Paying Agent/Registrar. The Corporation may at any time deliver to the Paying Agent/Registrar for cancellation any Bonds previously certified or registered and delivered which the Corporation may have acquired in any manner whatsoever, and all Bonds so deli vered shall be promptly canceled by the Paying Agent/Registrar. All canceled Bonds held by the Paying Agent/Registrar shall be destroyed as directed by the Corporation. SECTION 30. Sale of Bonds. The sale of the Bonds to Merrill Lvnch & Co. and associates (herein referred to as the "Purchasers") at the price of par plus a premium of $ -0- and accrued interest from the Issue Date to the date of delivery is hereby approved and confirmed. Delivery of 0048171 -31- the Bonds to the Purchasers shall occur as soon as possible upon payment being made therefor in accordance with the terms of sale. SECTION 31. Aporoval and Execution of Financina/Use Aareement with the City. The "Financing/Use Agreement" (the "Agreement") by and between the corporation and the City, attached hereto as Exhibit A and incorporated herein by reference as a part of this Resolution for all purposes, is hereby approved as to form and content, and such Agreement in substantially the form and substance attached hereto, together with such changes or revisions as may be necessary to accomplish the financing or benefit the corporation, is hereby authorized to be executed by the President and secretary of the Corporation and as the act and deed of this Board; and such Agreement as executed by said officials shall be deemed approved by the Board and constitute the Agreement herein approved. SECTION 32. Official statement. That the Official statement, together with all amendments and supplements thereto issued on behalf of the Corporation, prepared in the initial offering and sale of the Bonds by the Corporation is hereby approved as to form and content and the Board of Directors hereby finds that the information and data contained in said Official Statement pertaining to the Corporation and its financial affairs is true and correct in all material respects and no material facts have been omitted therefrom which are necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The use of such Official statement in the reoffering of the Bonds by the Purchasers is hereby approved and authorized. SECTION 33. Proceeds of Sale. The proceeds of sale of the Bonds, excluding the accrued interest recei ved from the Purchasers and the Initial Deposit to the Reserve Fund, shall be deposited in a construction fund in accordance with the Agreement. Pending expenditure for the Project, such proceeds of sale may be invested in authorized investments and, subject to the provisions of Section 27(h) hereof, any investment earnings realized shall be expended for the Project or deposited in the Bond Fund. All surplus proceeds of sale of the Bonds, including investment earnings, remaining after completion of the Project and paying or making provision for the payment of the amounts owed pursuant to section 27(h) (2) hereof shall be deposited to the credit of the Bond Fund. SECTION 34. Printed opinion. The obligation of the Purchasers to accept delivery of the Bonds is subject to being furnished a final opinion of Fulbright & Jaworski, Attorneys, Dallas, Texas, approving such Bonds as to their validity, said opinion to be dated and delivered as of the date of delivery and payment for such Bonds. An executed counterpart or a true and correct reproduction of said opinion shall accompany the Bonds or 0048171 -32- be printed on the reverse side of each definitive Bond issued is printed form is hereby approve and authorized. SECTION 35. CUSIP Numbers. CUSIP numbers may be printed or typed on the definitive Bonds. It is expressly provided, however, that the presence or absence of CUSIP numbers on the definitive Bonds shall be of no significance or effect as regards the legality thereof and neither the Corporation nor attorneys approving said Bonds as to legality are to be held responsible for CUSIP numbers incorrectly printed or typed on the definitive Bonds. SECTION 36. Control and CustodY of Bonds. The President of the Board shall be and is hereby authorized to take and have charge of all necessary orders and records pending investigation by the Attorney General of the state of Texas, and shall take and have charge and control of the Ini tial Bond (s) pending the approval thereof by the Attorney General, the registration thereof by the Comptroller of Public Accounts and the delivery thereof to the Purchasers. Furthermore, the Chairman of the Board of Directors or the President, vice President, Secretary and Treasurer of the Corporation, anyone or more of said officials, are hereby authorized and directed to furnish and execute such documents and certifications relating to the corporation and the issuance of the Bonds, as may be necessary for the approval of the Attorney General, registration by the Comptroller of Public Accounts and delivery of the Bonds to the initial purchasers and, together with the Corporation's financial advisor, general counsel, bond counsel and the Paying Agent/Registrar, make the necessary arrangements for the delivery of the Initial Bond(s) to the Purchasers and the initial exchange thereof for definitive Bonds. SECTION 37. Benefits of Resolution. Nothing in this Resolution, expressed or implied, is intended or shall be construed to confer upon any person other than the Corporation, the Paying Agent/Registrar and the Holders, any right, remedy, or claim, legal or equitable, under or by reason of this Resolution or any provision hereof, this Resolution and all its provisions being intended to be and being for the sole and exclusive benefit of the Corporation, the Paying Agent/Registrar and the Holders. SECTION 38. Inconsistent Provisions. All orders or resolutions, or parts thereof, which are in conflict or inconsistent with any provision of this Resolution are hereby repealed to the extent of such conflict and the provisions of this Resolution shall be and remain controlling as to the matters contained herein. SECTION 39. Governina Law. This Resolution shall be construed and enforced in accordance with the laws of the State of Texas and the united states of America. 0048171 -33- SECTION 40. Severability. If any prov1s1on of this Resolution or the application thereof to any circumstance shall be held to be invalid, the remainder of this Resolution and the application thereof to other circumstances shall nevertheless be valid, and the Board hereby declares that this Resolution would have been enacted without such invalid provision. SECTION 41. Construction of Terms. If appropriate in the context of this Resolution, words of the singular number shall be considered to include the plural, words of the plural number shall be considered to include the singular, and words of the masculine, feminine or neuter gender shall be considered to include the other genders. SECTION 42. Public Meetina. It is officially found, determined, and declared that the meeting at which this Resolution is adopted was open to the public and public notice of the time, place, and subject matter of the public business to be considered at such meeting, including this Resolution, was givEm, all as required by Article 6252-17, Vernon's Texas civil statutes, as amended. SECTION 43. Effective Date. This Resolution shall be in force and effect from and after its passage on the date shown below. PASSED AND ADOPTED, this November 23, 1992. NORTH RICHLAND HILLS PARK AND RECREATION FACILITIES DEVELOPMENT CORPORATION K I)f~ President ATTEST: C) ~ " "-;/ . "..i! ¿(~.-L.n~, /::..U_<-L-<--o 1/ Secretary ¡.. (Corporation Seal) 0048171 -34- (¡X~{IP , FINANCING/USE AGREEMENT This Financing/Use Agreement (this "Agreement') is made to be effective as of the 23rd day of November, 1992, by and between the city of North Richland Hills, Texas, a duly incorporated and existing municipal corporation and political subdivision of the State of Texas (the "city") and the North Richland Hills Parks and Recreation Facilities Development corporation, a non-profit industrial development corporation organized and existing under the laws of the state of Texas, including Vernon's Ann. ci v . st., section 4B of Article 5190.6, (the "Corporation") R E C I TAL S WHEREAS, the corporation on behalf of the city is to finance the costs of land, buildings, equipment, facilities and improvements suitable for use for amateur (including children's) sports, athletic, entertainment and public park purposes and events, including (i) the construction of phase I of an athletic which includes an aquatic and tennis center and (ii) the acquisition of land and its development as soccer and baseball facilities(the "Project"); and WHEREAS, such financing contemplates the issuance and sale of the Corporation's tax exempt bonds in the principal amount of $7,500,000, and the proceeds of sale are to be used by the City to design and construct the project; and WHEREAS, the city will have full responsibility for the design and construction of the Project and the Corporation shall have no duties or responsibilities with respect to the Project other than to provide for the financing of its costs; AGREEMENT 1. Financina of proiect: For and in consideration of the city's covenants and agreements herein contained and subject to the terms contained herein, the Corporation hereby agrees to issue and sale a series of obligations to be known as "North Richland Hills Park and Recreation Facilities Development Corporation Sales Tax Revenue Bonds, Series 1992", hereinafter called the "Bonds", and deposit the proceeds of sale of the Bonds to a construction fund or account to be designated by the City, and the City hereby agrees and covenants that all proceeds of sale deposited to the credit of such construction account shall be used solely to pay the costs of the Project. 2. Use of Proiect. until all the Bonds have been fully paid, discharged and retired, the upkeep and maintenance of the project will be the responsibility of the City and the Corporation shall have no responsibility with respect to the operation, upkeep and maintenance of the Project. .. ~..« tt\:\\'?:>\\ . 0048218 3. Collection and Transfer of Proceeds of Sales Tax. The city agrees, in cooperation with the Corporation, to take such actions as are required to cause the "Gross Sales Tax Revenues" (as such term is defined in the resolution authorizing the issuance of the Bonds) received from the comptroller of Public Accounts of the State of Texas for and on behalf of the Corporation to be transferred and deposited immediately upon receipt by the City to the credit of the banking or monetary fund maintained at the depository designated by the Corporation and known on the books and records of the Corporation as the "Pledged Revenue Fund". 4. Recognition of Tax Exempt Financina. The City hereby acknowledges and recognizes that the Bonds are being issued as "state or local bonds" under and pursuant to section 103(a) of the Internal Revenue Code of 1986, as amended, and the City hereby covenants and agrees with respect to the use of proceeds of sale of the Bonds and the use of the Project as follows: (a) Definitions. When used in this paragraph, the fOllowing terms have the following meanings: "Code" means the Internal Revenue Code of 1986, as amended by all legislation, if any, enacted on or before the Issue Date. "Computation Date" has the meaning stated in Treas. Reg. § 1.148-8 (b) (1) . "Gross Proceeds" has the meaning stated in Treas. Reg. § 1.148-8(d). "Investment" has the meaning stated in Treas. Reg. § 1.148-8(e). "Issue Date" means the date on which the Bonds are first authenticated and delivered to the initial purchasers against payment therefor. "Nonpurpose Investment" means any Investment in which Gross Proceeds of the Bonds are invested and which is not acquired to carry out the governmental purpose of the Bonds. Obligations acquired with proceeds of the Bonds that are to be used to discharge thê Refunded Bonds are Nonpurpose Investments. "Rebatable Arbitrage" has the meaning stated in Treas. Reg. § 1.148-2. "Yield of" (i) any Investment shall be computed in accordance with Treas. Reg. §1.148-2, and 0048218 \< ~ \l\\ \:6 \ .. .'. -2- (ii) the Bonds has the meaning stated in Treas. Reg. § 1.148-3. (b) Not to Cause Interest to Become Taxable. The City shall not use, permit the use of, or omit to use Gross Proceeds or any other amounts (or any property the acquisition, construction, or improvement of which is to be financed directly or indirectly with Gross Proceeds) in a manner which, if made or omitted, respecti vely , would cause the interest on any Bond to become includable in the gross income, as defined in section 61 of the Code, of the owner thereof for federal income tax purposes. without limiting the generality of the foregoing, unless and until the city shall have received a written opinion of counsel nationally recognized in the field of municipal bond law to the effect that failure to comply with such covenant will not adversely affect the exclusion of interest on any Bond from gross income for federal income tax purposes pursuant to section 103 of the Code, the city shall comply with each of the specific covenants in this paragraph. (c) No Private Use or Private Payments. The Bonds are being issued to finance the Project and, except as permitted by section 141 of the Code and the regulations and rulings thereunder, the Project shall at all times prior to the last maturity of the Bonds: (i) be exclusively owned, operated and maintained by the City, and the City shall not use or permit the use of such Gross Proceeds or any property acquired, constructed, or improved with such Gross Proceeds in any activity carried on by any person or entity other than a state or local government, unless such use is solely as a member of the general public, and (ii) the City shall not directly or indirectly impose or accept any charge or other payment for use of Gross Proceeds of the Bonds or for any property acquired, constructed, or improved indirectly wi th such Gross Proceeds, other than taxes of general application within the City or interest earned on investments acquired with such Gross Proceeds pending application for their intended purposes. (d) No Private Loan. Except to the extent permitted by section 141 of the Code and the regulations and rulings thereunder, the City shall not use Gross Proceeds of the Bonds to make or finance loans to any person or entity other than a state or local government. For purposes of the foregoing covenant, such Gross Proceeds are considered to be "loaned" to a person or entity if (i) property acquired, constructed, or improved with such Gross Proceeds is sold or leased to such person or entity in a transaction which creates a debt for federal income tax purposes, (ii) capacity in or service from such property is committed to such person or entity under a take-or-pay, output, or similar contract 0048218 {\ ~J,\\\fð\\ k~3_ or arrangement, or (iii) indirect benefits, or burdens and benefits of ownership, of such Gross Proceeds or any property acquired, constructed, or improved with such Gross Proceeds are otherwise transferred in a transaction which is the economic equivalent of a loan. (e) Not to Invest at Hiaher Yield. Except to the extent permitted by section 148 of the Code and the regulations and rulings thereunder, the City shall not, at any time prior to the final stated Maturity of the Bonds, directly or indirectly invest Gross Proceeds of the Bonds in any Investment (or use such Gross Proceeds to replace money so invested), if as a result of such investment the Yield of all Investments allocated to such Gross Proceeds whether then held or previously disposed of, exceeds the Yield of the Bonds. (f) Not Federally Guaranteed. Except to the extent permitted by section 149 (b) of the Code and the regulations and rulings thereunder, the City shall not take or omit to take any action which would cause the Bonds to be federally guaranteed within the meaning of section 149 (b) of the Code and the regulations and rulings thereunder. (g) Payment of Rebatable Arbitraae. Except to the extent otherwise provided in section 148(f) of the Code and the regulations and rulings thereunder, (i) The City shall account for all Gross Proceeds of the Bonds (including all receipts, expenditures, and investments thereof) on their respective books of account separately and apart from all other funds (and receipts, expenditures, and investments thereof) and shall maintain all records of such accounting with other public records relating to the Project until six years after the final computation Date. The City may, however, to the extent permitted by section 148(f) of the Code and the regulations thereunder, commingle Gross Proceeds of the Bonds with other money of the city, provided that the city separately accounts for each receipt and expenditure of such Gross Proceeds and the obligations acquired therewith. (ii) Not less frequently than each computation Date, the city shall either (aa) cause to be calculated by a nationally recognized accounting or financial advisory firm or (bb) calculate and cause its calculations to be verified by a nationally recognized accounting or financial advisory firm, in either case in accordance with rules set forth in section 148(f) of the Code and Treas. Reg. S 1.148-2 and rulings thereunder, the Rebatable Arbitrage with respect to the Bonds. The City shall maintain such calculations relating to the issuance ^ 0048218 {\, <>.~, .~ ,\,. ",)1'\" . \ΕΎ ,;~. -4- of the Bonds until six years after the final computation Date. (iii) As additional consideration for the issuance of the Bonds by the initial purchasers thereof and the loan represented thereby, and in order to induce such purchase by measures designed to result in the excludability of the interest thereon from the gross income of the owners thereof for federal income tax purposes, the City shall remit to the Corporation for payment to the United states the amount described in paragraph (g) (ii) above and the amount described in paragraph (g) (iv) below, at the times, in the installments, to the place, in the manner, and accompanied by such forms or other information as is or may be required by section 148 (f) of the Code and Treas. Reg. S§ 1.148-1 through 1.148-9 and rulings thereunder. (i v) The City shall exercise reasonable diligence to assure that no errors are made in the calculations required by paragraph (g) (ii) and, if such error is made, to discover and promptly to correct such error within a reasonable amount of time thereafter, including the amount remitted to the Corporation for payment to the United states of any Correction Amount as described in Treas. Reg. S 1.148-1(c) (2) and any penalty under Treas. Reg. S 1. 148 -1 ( c) (3) (i i) (B) . (v) The City shall not, at any time prior to the earlier of the stated Maturity or final payment of the Bonds, enter into any transaction that reduces the amount required to be paid to the united states pursuant to this subparagraph (g) because such transaction results in a smaller profit or a larger loss than would have resulted if the transaction had been at arm's length and had the Yield of the Bonds not been relevant to either party. 5. Modifications. This Agreement shall not be changed orally, and no executory agreement shall be effective to waive, change, modify or discharge this Agreement in whole or in part unless such executory agreement is in writing and is signed by the parties against whom enforcement of any waiver, change, modification or discharge is sought. 6. Entire Aareement. This Agreement, including the Exhibits, contains the entire agreement between the parties pertaining to the subject matter hereof and fully supersedes all prior agreements and understandings between the parties pertaining to such subject matter. 7 . Counteroarts. This Agreement may be executed in several counterparts, and all such executed counterparts shall constitute 0048218 \0\ "I.' ,\\,~ \\~)~\., \. ~" \~ -5- the same agreement. It shall be necessary to account for only one such counterpart in proving this Agreement. 8. Severabili ty. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement shall nonetheless remain in full force and effect. 9. Applicable Law. This Agreement shall in all respects be governed by, and construed in accordance with, the substantive federal laws of the united states and the laws of the state of Texas. 10. caotions. The section headings appearing in this Agreement are for convenience of reference only and are not intended, to any extent and for any purpose, to limit or define the text of any section or any subsection hereof. IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the date and year first above written. ATTEST: t. Cf~Á~ ~-GA' Secretary (corporation Seal) NORTH RICHLAND HILLS PARK AND RECREATION I'ACILITIBS KLJil7~ORATIOIJ President CITY O~ NORTH RICHLAND HILLS, TEXAS ~~~~Æ~ C· Secretary (City Seal) S-~~) M r 0048218 ~" " \,~~ -6-