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Home My WebLink AboutItem 10 - Refunding BondsMEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: BRUNO RUMBELOW, CITY MANAGER MEETING DATE: APRIL 17, 2018 SUBJECT: RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF CITY OF GRAPEVINE, TEXAS, GENERAL OBLIGATION REFUNDING BONDS, SERIES 2018 RECOMMENDATION: City Council to consider a resolution authorizing the issuance and sale of City of Grapevine, Texas, General Obligation Refunding Bonds, Series 2018; levying a tax in payment thereof; awarding the sale of the bonds, prescribing the form of said bonds; approving execution and delivery of a deposit agreement; approving the official statement, approving and enacting other provisions relating thereto. FUNDING SOURCE: Upon approval of the attached resolution, funds will be available in the General Long -Term Debt Group. BACKGROUND: This action will refund 2014 Certificates of Obligation that were used in the amount of $19,500,000 for the acquisition of land within the City used to promote new and expanded business enterprises and to pay for the costs of issuance related to the sale of the Certificates. The refund is estimated to reduce the interest rate from 5.52% to 4.20% and is estimated to save the City approximately $2,476,583. This action will not extend the term of the bonds, which will be fully retired in 2034. Staff recommends approval. J B/gj RESOLUATION NO. 2018-034 AUTHORIZING GRAPEVINE 4B ECONOMIC DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING BONDS, TAXABLE SERIES 2018 Dated: April 17, 2018 #5663887.3 TABLE OF CONTENTS Page Parties.........................................................................................................................................1 ARTICLE I DEFINITIONS AND OTHER PRELIMINARY MATTERS Section1.01. Definitions.........................................................................................................2 Section 1.02. Other Definitions...............................................................................................5 Section1.03. Findings.............................................................................................................5 Section 1.04. Table of Contents, Titles and Headings..............................................................5 Section1.05. Interpretation......................................................................................................6 ARTICLE II SECURITY FOR THE BONDS Section 2.01. Confirmation and Levy of Sales Tax..................................................................6 Section2.02. Pledge................................................................................................................6 Section 2.03. Resolution as Security Agreement......................................................................7 ARTICLE III AUTHORIZATION; GENERAL TERMS AND PROVISIONS REGARDING THE BONDS Section 3.01. Authorization.....................................................................................................7 Section 3.02. Date, Denomination, Maturities, Numbers and Interest.......................................8 Section 3.03. Medium, Method and Place of Payment............................................................. 8 Section 3.04. Execution and Initial Registration......................................................................9 Section3.05. Ownership..........................................................................................................9 Section 3.06. Registration, Transfer and Exchange................................................................10 Section 3.07. Cancellation and Authentication.......................................................................10 Section 3.08. Temporary Bonds............................................................................................. l l Section 3.09. Replacement Bonds..........................................................................................12 Section 3.10. Book -Entry Only System.................................................................................13 Section 3.11. Successor Securities Depository; Transfer Outside...........................................13 Section 3.12. Payments to Cede & Co...................................................................................14 ARTICLE IV REDEMPTION OF BONDS BEFORE MATURITY Section 4.01. Limitation on Redemption................................................................................14 Section 4.02. Optional Redemption.......................................................................................14 (i) #5663887.3 Section 4.03. Mandatory Sinking Fund Redemption..............................................................14 Section 4.04. Partial Redemption...........................................................................................16 Section 4.05. Notice of Redemption to Owners.....................................................................16 Section 4.06. Payment Upon Redemption..............................................................................16 Section 4.07. Effect of Redemption.......................................................................................17 Section 4.08. Conditional Notice of Redemption...................................................................17 30 ARTICLE V PAYING AGENT/REGISTRAR Section 5.01. Appointment of Initial Paying Agent/Registrar.................................................17 Section 5.02. Qualifications...................................................................................................17 Section 5.03. Maintaining Paying Agent/Registrar................................................................17 Section5.04. Termination.....................................................................................................18 Section 5.05. Notice of Change.............................................................................................18 Section 5.06. Agreement to Perform Duties and Functions....................................................18 30 Section 5.07. Delivery of Records to Successor.....................................................................18 ARTICLE VI FORM OF THE BONDS Section 6.01. Form Generally................................................................................................18 Section6.02. Form of Bonds.................................................................................................19 Section 6.03. CUSIP Registration..........................................................................................25 Section6.04. Legal Opinion..................................................................................................26 Section 6.05. Municipal Bond Insurance...............................................................................26 ARTICLE VII SALE OF THE BONDS; CONTROL AND DELIVERY OF THE BONDS Section 7.01. Sale of Bonds; Official Statement.....................................................................26 Section 7.02. Control and Delivery of Bonds.........................................................................27 ARTICLE VIII FUNDS AND ACCOUNTS, INITIAL DEPOSITS AND APPLICATION OF MONEY Section 8.01. Creation of Funds.............................................................................................27 Section 8.02. Deposit of Proceeds.........................................................................................28 Section 8.03. Sales Tax Revenue Fund..................................................................................28 Section 8.04. Debt Service Fund............................................................................................29 Section8.05. Reserve Fund...................................................................................................30 Section 8.06. Deficiencies in Funds....................................................................................... 30 #5663887.3 Section 8.07. Security of Funds.............................................................................................30 32 Section8.08. Investments...................................................................................................... 31 Section 8.09. Investment Income........................................................................................... 31 ARTICLE IX ADDITIONAL OBLIGATIONS Section 9.01. Issuance of Superior Lien Obligations Prohibited.............................................31 Section 9.02. Issuance of Additional Parity Obligations Authorized......................................31 ARTICLE X PARTICULAR REPRESENTATIONS AND COVENANTS Section 10.01. Pledged Funds and Pledged Revenues.............................................................. 32 Section 10.02. Accounts, Periodical Reports and Certificates..................................................32 Section10.03. General............................................................................................................33 Section 10.04. Repeal of Power to Collect Sales Tax...............................................................33 Section 10.05. Payment of the Bonds......................................................................................33 ARTICLE XI DEFAULT AND REMEDIES Section 11.01. Events of Default.............................................................................................33 Section 11.02. Remedies for Default.......................................................................................34 Section 11.03. Remedies Not Exclusive..................................................................................34 ARTICLE XII DISCHARGE Section 12.01. Discharge........................................................... Error! Bookmark not defined. ARTICLE XIII PAYMENT OF REFUNDED BONDS; REDEMPTION OF REFUNDED BONDS; APPROVAL OF DEPOSIT AGREEMENT Section 13.01. Deposit Agreement..........................................................................................35 Section 13.02. Redemption and Payment of Refunded Bonds..................................................35 Section 13.03. Notice of Deposit and Redemption...................................................................35 gym) #5663887.3 ARTICLE XIV LAPSE OF PAYMENT Section 14.01. Lapse of Payment.............................................................................................35 ARTICLE XV CONTINUING DISCLOSURE UNDERTAKING Section 15.01. Definitions of Continuing Disclosure Terms.....................................................36 Section 15.02. Annual Reports................................................................................................36 Section 15.03. Disclosure Event Notices.................................................................................36 Section 15.04. Limitations, Disclaimers and Amendments......................................................37 ARTICLE XVI AMENDMENTS Section16.01. Amendments.................................................................................................... 39 Section 16.02. Attorney General Modification.........................................................................39 Signatures.................................................................................................................................39 SCHEDULE I — Schedule of Refunded Bonds (iv) #5663887.3 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE GRAPEVINE 4B ECONOMIC DEVELOPMENT CORPORATION, AUTHORIZING THE ISSUANCE AND SALE OF GRAPEVINE 4B ECONOMIC DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING BONDS, TAXABLE SERIES 2018, IN THE AGGREGATE PRINCIPAL AMOUNT OF $ ; PRESCRIBING THE FORM OF SAID BONDS; AWARDING THE SALE OF THE BONDS; PROVIDING FOR THE SECURITY FOR AND PAYMENT OF SAID BONDS; AUTHORIZING THE EXECUTION AND DELIVERY OF A PAYING AGENT/REGISTRAR AGREEMENT AND DEPOSIT AGREEMENT; APPROVING THE OFFICIAL STATEMENT; AND CONTAINING OTHER PROVISIONS RELATING TO THE SUBJECT WHEREAS, the Grapevine 4B Economic Development Corporation (the "Corporation") is a non-profit industrial development corporation created, existing and governed by Chapters 501, 502 and 505, Texas Local Government Code, as amended (the "Act"); and WHEREAS, pursuant to the authority granted in the Act, the City of Grapevine, Texas (the "City") has levied a Sales Tax (as defined herein) in the amount of 1/2 of one cent for the benefit of the Corporation, to be used exclusively for the purposes set forth in the Act; and WHEREAS, the Corporation has previously pledged 3/4 of its Sales Tax to a contract between the Corporation and the Fort Worth Transportation Authority (the "Contract"); and WHEREAS, the Corporation has 1/4 of its Sales Tax that is not currently pledged to any obligations; and WHEREAS, the Corporation is authorized by the Act to issue its revenue bonds, to be secured by and payable from all or a portion of such Sales Tax, in the manner and for the purposes hereinafter provided; and WHEREAS, from Gross Sales Tax Revenues (as defined herein), and for so long as the Bonds remain outstanding, the Corporation will dedicate 1/4 of such Gross Sales Tax Revenues to the payment of the Bonds; and WHEREAS, the Corporation has previously issued its sales tax revenue bonds (hereinafter defined as the "Previously Issued Bonds") payable from and secured by a lien on and pledge of the Pledged Revenues (as defined in the Previously Issued Bond Resolution); and WHEREAS, the Corporation desires to refund the Previously Issued Bonds set forth on Schedule 1 attached hereto and incorporated by reference for all purposes (the "Refunded Bonds"); and #5663887.3 WHEREAS, the Board hereby finds and determines that the refunding of the Refunded Bonds for the purpose of achieving a net present value debt service savings of approximately $ is in the best interest of the Corporation; and WHEREAS, the Corporation hereby finds and determines that the issuance and delivery of the bonds hereinafter authorized is in the public interest and the use of the proceeds in the manner herein specified constitutes a valid public purpose; and WHEREAS, it is officially found, determined, and declared that the meeting at which this Resolution has been adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered and acted upon at said meeting, including this Resolution, was given, all as required by the applicable provisions of Chapter 551, Texas Government Code, as amended; Now, Therefore BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE GRAPEVINE 4B ECONOMIC DEVELOPMENT CORPORATION: ARTICLE I DEFINITIONS AND OTHER PRELIMINARY MATTERS Section 1.01. Definitions. Unless otherwise expressly provided or unless the context clearly requires otherwise, in this Resolution the following terms shall have the meanings specified below: "Additional Parity Obligations" means those obligations the Corporation reserves the right to issue on a parity with the Bonds herein authorized, in accordance with the terms and conditions prescribed in Section 9.02 hereof "Authorized Officer" means the President, Vice President, or Secretary of the Corporation or any other officer or employee of the Corporation, or any other person authorized to perform specific acts or duties by the Board or its bylaws. "Board" means the Board of Directors of the Corporation. "Bond" means any of the Bonds. "Bonds" means the Corporation's bonds entitled "Grapevine 413 Economic Development Corporation Sales Tax Revenue Refunding Bonds, Taxable Series 2018" authorized to be issued by Section 3.01 of this Resolution. "Closing Date" means the date of the initial delivery of and payment for the Bonds. "Code" means the Internal Revenue Code of 1986, as amended, including applicable regulations, published rulings and court decisions relating thereto. "Comptroller" means the Comptroller of Public Accounts of the State of Texas and any successor officer or official that may be charged by law with the duty of collecting Gross Sales -2- #5663887.3 Tax Revenues for the account of, and remitting the same to, the City for the account of the Corporation. "Corporation Order" means a written order signed in the name of the Corporation by an Authorized Officer and delivered to the Paying Agent, or another party hereunder. "Debt Service Fund" means the debt service fund established by Section 8.01 of this Resolution. "Deposit Agreement" means the Deposit Agreement relating to the Bonds authorized pursuant to Section 13.01 herein, by and between the paying agent/registrar for the Refunded Bonds, and the Corporation. "Designated Payment/Transfer Office" means (i) with respect to the initial Paying Agent/Registrar named herein, its corporate trust office in Dallas, Texas, and (ii) with respect to any successor Paying Agent/Registrar, the office of such successor designated and located as may be agreed upon by the Corporation and such successor. "DTC" means The Depository Trust Company of New York, New York, or any successor securities depository. "DTC Participant" means brokers and dealers, banks, trust companies, clearing corporations and certain other organizations on whose behalf DTC was created to hold securities to facilitate the clearance and settlement of securities transactions among DTC Participants. "Emma" means the Electronic Municipal Market Access System. "Event of Default" means any Event of Default as defined in Section 11.01 of this Resolution. "Fiscal Year" means October 1 through September 30. "Gross Sales Tax Revenues" means all of the revenues due or owing to, or collected or received by or on behalf of the Corporation, whether by the City or otherwise from or by reason of the levy of the Sales Tax, less any amounts due or owing to the Comptroller as charges for collection or retentions by the Comptroller for refunds and to redeem dishonored checks and drafts, to the extent such charges and retention are authorized or required by law. "Initial Bond" means the Bond described in Section 3.04(d) and 6.02(d). "Interest Payment Date" means the date or dates upon which interest on the Bonds is scheduled to be paid until the maturity of the Bonds, such dates being February 15 and August 15 of each year commencing August 15, 2018 to be set forth in the Pricing Certificate. "MSRB" means the Municipal Securities Rulemaking Board. "Original Issue Date" means the date of delivery of the Bonds to the Purchasers or such other date as set forth in the Pricing Certificate. -3- #5663887.3 "Owner" means the person who is the registered owner of a Bond or Bonds, as shown in the Register. "Parity Revenue Obligations" means the Previously Issued Bonds, Bonds and Additional Parity Obligations. "Paying Agent/Registrar" means that paying agent/registrar set forth in the Pricing Certificate or any successor thereto or an entity which is appointed as and assumes the duties of paying agent/registrar as provided in this Resolution. "Pledged Funds" means collectively (a) amounts on deposit in the Sales Tax Revenue Fund, (b) amounts on deposit in the Debt Service Fund, (c) amounts on deposit in the Reserve Fund, together with any investments or earnings belonging to said funds, and (d) any additional revenues, other moneys or funds of the Corporation which heretofore have been or hereafter may be expressly and specifically pledged to the payment of the Parity Revenue Obligations. "Pledged Revenues" means (a) 1/4 of the Gross Sales Tax Revenues from time to time deposited or owing to the Sales Tax Revenue Fund, and (b) such other money, income, revenues or other property which the Corporation may expressly and specifically pledge to the payment of Parity Revenue Obligations. "Pledged Sales Tax" means 1/4 of the Sales Tax. "Previously Issued Bonds" means the outstanding and unpaid revenue bonds of the Corporation designated as the Sales Tax Revenue Bonds, Taxable Series 2014, dated January 15, 2014. "Projects" means all properties, including land, buildings, and equipment of the types added to the definition of "projects" by the Act that are approved by the Board as necessary and appropriate to fulfill and carry out the purposes of the Corporation. "Purchaser" means the Purchaser(s) set forth in Section 7.01 herein. "Record Date" means the last business day of the month next preceding an Interest Payment Date, unless modified by the Pricing Certificate. "Refunded Bonds" means those outstanding bonds of the Corporation identified on Schedule 1 attached hereto. "Register" means the Register specified in Section 3.06(a) of this Resolution. "Representation Letter" means the Blanket Letter of Representations with respect to the Bonds between the Corporation and DTC. "Required Reserve" means the amount required to be maintained in the Reserve Fund pursuant to Section 8.05(a). "Reserve Fund" means the reserve fund established by Section 8.01 of this Resolution. -4- #5663887.3 "Reserve Fund Surety Bond" means any surety bond or insurance policy having a rating in the two highest respective rating categories by Moody's Investors Service, Inc. or Standard & Poor's, Ratings Services, a Standard & Poor's Financial Service LLC business, issued to the Corporation for the benefit of the Owners of the Bonds to satisfy any part of the Required Reserve as provided in Section 8.05(d) of this Resolution. "Resolution" means this Resolution. "Rule" means SEC Rule 15c2-12, as amended from time to time. "Sales Tax" means the 1/2 of one cent local sales and use tax authorized under the Act and heretofore authorized and levied by the City within its existing boundaries, and hereafter required to be levied and collected within any expanded areas included within the City pursuant to the Act, together with any increases in the rate thereof if provided and authorized by applicable law. "Sales Tax Collection Resolution" means that certain resolution adopted concurrently by the Board and the governing body of the City, bearing that name. "Sales Tax Revenue Fund" means the special fund so designated in Section 8.01 hereof. "SEC" means the United States Securities and Exchange Commission. "Special Payment Date" means the Special Payment Date prescribed by Section 3.03(b) of this Resolution. "Special Record Date" means the Special Record Date prescribed by Section 3.03(b) of this Resolution. "Unclaimed Payments" means money deposited with the Paying Agent/Registrar for the payment of the principal of or interest on the Bonds as the same come due and payable and remaining unclaimed by the Owners of Bonds for 90 days after the applicable payment or redemption date. Section 1.02. Other Definitions. The terms "Act," "Corporation" and "City" shall have the respective meanings assigned in the preamble to this Resolution. Section 1.03. Findings. The declarations, determinations and findings declared, made and found in the preamble to this Resolution are hereby adopted, restated and made a part of the operative provisions hereof. Section 1.04. Table of Contents, Titles and Headin&s. The table of contents, titles and headings of the Articles and Sections of this Resolution have been inserted for convenience of reference only and are not to be considered a part hereof and shall not in any way modify or restrict any of the terms or provisions hereof and shall never be considered or given any effect in construing this Resolution or any provision hereof or in ascertaining intent, if any question of intent should arise. -5- #5663887.3 Section 1.05. Interpretation. (a) Unless the context requires otherwise, words of the masculine gender shall be construed to include correlative words of the feminine and neuter genders and vice versa, and words of the singular number shall be construed to include correlative words of the plural number and vice versa. (b) This Resolution and all the terms and provisions hereof shall be liberally construed to effectuate the purposes set forth herein to sustain the validity of this Resolution. ARTICLE II SECURITY FOR THE BONDS Section 2.01. Confirmation and Levy of Sales Tax. (a) The Corporation 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 November 7, 2006, and the Corporation hereby warrants and represents that the City has duly and lawfully ordered the imposition and collection of the Pledged Sales Tax upon all sales, uses and transactions as are permitted by and described in 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) For so long as any Parity Revenue Obligations are outstanding, the Corporation covenants, agrees and warrants to take and pursue all action permissible under applicable law to cause the Pledged Sales Tax, at said rate to be levied and collected continuously, in the manner and to the maximum extent permitted by applicable law, and to cause no reduction, abatement or exemption in the Pledged Sales Tax or rate of tax below the rate stated, confirmed and ordered in subsection (a) of this Section to be ordered or permitted so long as any Parity Revenue Obligations shall remain outstanding. (c) If the City shall be authorized hereafter by applicable law to apply, impose and levy the Pledged Sales Tax on any taxable items or transactions that are not subject to the Pledged Sales Tax on the date of the adoption hereof, the Corporation, to the extent it legally may do so, hereby covenants and agrees to use its best efforts to cause the City to take such action as may be required by applicable law to subject such taxable items or transactions to the Pledged Sales Tax. (d) The Corporation agrees to take and pursue all action permissible under applicable law to cause the Pledged Sales Tax to be collected and remitted and deposited as herein required and as required by the Act, at the earliest and most frequent times permitted by applicable law. (e) The Corporation agrees and covenants at all times, and to use its best efforts to cause the City, to comply with the Sales Tax Collection Resolution. Section 2.02. Pledge. The Corporation hereby irrevocably pledges (a) the Pledged Revenues, and (b) the Pledged Funds (i) to the payment of the principal of, and the interest and any premiums on, all Parity Revenue Obligations which are or may be outstanding from time to time, and (ii) to the establishment and maintenance of the Reserve Fund. -6- #5663887.3 (a) The provisions, covenants, pledge and lien on and against the Pledged Revenues and the Pledged Funds, as herein set forth, are established and shall be for the equal benefit, protection and security of the Owners of the Parity Revenue Obligations without distinction as to priority and rights. (b) The Parity Revenue Obligations, including interest payable thereon, shall constitute special obligations of the Corporation, payable solely from and secured by a first lien on and pledge of the Pledged Revenues and Pledged Funds, and not from any other revenues, properties or income of the Corporation. Parity Revenue Obligations shall not constitute debts or obligations of the State or of the City, and the Owners of the Parity Revenue Obligations shall never have the right to demand payment out of any funds raised or to be raised by ad valorem taxation. Section 2.03. Resolution as Security Agreement. (a) An executed copy of this Resolution shall constitute a security agreement pursuant to applicable law, with the Owners as the secured parties. The lien, pledge, and security interest of the Owners created in this Resolution shall become effective immediately upon the Closing Date of the Bonds, and the same shall be continuously effective for so long as any Bonds are outstanding. (b) A fully executed copy of this Resolution and the proceedings authorizing it shall be filed as a security agreement among the permanent records of the Corporation. Such records shall be open for inspection to any member of the general public and to any person proposing to do or doing business with, or asserting claims against, the Corporation, at all times during regular business hours. (c) The provisions of this section are prescribed pursuant to the Act, the Texas Public Securities Procedures Act (Texas Government Code, Chapter 1201, as amended), and other applicable laws of the State. If any other applicable law, in the opinion of counsel to the Corporation, requires any filing or other action additional to the filing pursuant to this section in order to preserve the priority of the lien, pledge, and security interest of the Owners created by this Resolution, the Corporation shall diligently make such filing or take such other action to the extent required by law to accomplish such result. ARTICLE III AUTHORIZATION; GENERAL TERMS AND PROVISIONS REGARDING THE BONDS Section 3.01. Authorization. The Corporation's bonds to be designated "Grapevine 4B Economic Development Corporation Sales Tax Revenue Refunding Bonds, Taxable Series 2018," are hereby authorized to be issued and delivered in accordance with the laws of the State of Texas, particularly Chapters 501, 502 and 505, Texas Local Government Code, as amended in the aggregate principal amount of $ for the purpose of (i) refunding the Refunded Bonds, (ii) funding a debt service reserve fund, and (iii) paying the costs of issuing the Bonds. -7- #5663887.3 Section 3.02. Date, Denomination, Maturities, Numbers and Interest. (a) The Bonds shall be dated the date set forth in the Pricing Certificate, shall be in fully registered form, without coupons, in the denomination of $5,000 or any integral multiple thereof, and shall be numbered separately from one upward or such other designation acceptable to the Corporation and the Paying Agent/Registrar, except the Initial Bond, which shall be numbered T-1. (b) The Bonds shall mature on the dates and in the years and in the principal amounts set forth in the Pricing Certificate. (c) Interest shall accrue and be paid on each Bond respectively until the principal of such Bond shall have been paid or provision for such payment shall have been made, from the later of the date set forth in the Pricing Certificate or the most recent Interest Payment Date to which interest has been paid or provided for at the rate per annum for each respective maturity specified in the schedule contained in subsection (b) above. Such interest shall be payable semiannually on the dates set forth in the Pricing Certificate, computed on the basis of a 360 -day year of twelve 30 -day months. Section 3.03. Medium, Method and Place of Payment. (a) The principal of, premium, if any, and interest on the Bonds shall be paid in lawful money of the United States of America as provided in this Section. (b) Interest on the Bonds shall be payable to the Owners whose names appear in the Register at the close of business on the Record Date; provided, however, that in the event of nonpayment of interest on a scheduled Interest Payment Date, and for 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 (the "Special Payment Date," which shall be at least 15 days after the Special Record Date) shall be sent at least five business days prior to the Special Record Date by United States mail, first class postage prepaid, to the address of each Owner of a Bond appearing on the books of the Paying Agent/Registrar at the close of business on the last business day next preceding the date of mailing of such notice. (c) Interest on the Bonds shall be paid by check (dated as of the Interest Payment Date) and sent by the Paying Agent/Registrar to the person entitled to such payment, United States mail, first class postage prepaid, to the address of such person as it appears in the Register or by such other customary banking arrangements acceptable to the Paying Agent/Registrar and the person to whom interest is to be paid; provided, however, that such person shall bear all risk and expenses of such other customary banking arrangements. (d) The principal of each Bond shall be paid to the person in whose name such Bond is registered on the due date thereof (whether at the maturity date or the date of prior redemption thereof) upon presentation and surrender of such Bond at the Designated Payment/Transfer Office. (e) If a date for the payment of the principal of or interest on the Bonds is a Saturday, Sunday, legal holiday, or a day on which banking institutions in the city in which the Designated #5663887.3 Payment/Transfer Office is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not a Saturday, Sunday, legal holiday, or day on which such 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. (f) Subject to any applicable escheat, unclaimed property, or similar law, including Title 6 of the Texas Property Code, Unclaimed Payments remaining unclaimed by the Owners entitled thereto for three years after the applicable payment or redemption date shall be paid to the Corporation and thereafter neither the Corporation, the Paying Agent/Registrar, nor any other person shall be liable or responsible to any Owners of such Bonds for any further payment of such unclaimed moneys or on account of any such Bonds. Section 3.04. Execution and Initial Registration. (a) The Bonds shall be executed on behalf of the Corporation by the President and Secretary of the Corporation, by their manual or facsimile signatures. Such facsimile signatures on the Bonds shall have the same effect as if each of the Bonds had been signed manually and in person by each of said officers. (b) In the event that any officer of the Corporation whose manual or facsimile signature appears on the Bonds ceases to be such officer before the authentication of such Bonds or before the delivery thereof, such manual or facsimile signature nevertheless shall be valid and sufficient for all purposes as if such officer had remained in such office. (c) Except as provided below, no Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit of this Resolution unless and until there appears thereon the Certificate of Paying Agent/Registrar substantially in the form provided in this Resolution, duly authenticated by manual execution of the Paying Agent/Registrar. It shall not be required that the same authorized representative of the Paying Agent/Registrar sign the Certificate of Paying Agent/Registrar on all of the Bonds. In lieu of the executed Certificate of Paying Agent/Registrar described above, the Initial Bond delivered on the Closing Date shall have attached thereto the Comptroller's Registration Certificate substantially in the form provided in this Resolution, manually executed by the Comptroller of Public Accounts of the State of Texas or by his duly authorized agent, which certificate shall be evidence that the Initial Bond has been duly approved by the Attorney General of the State of Texas and that it is a valid and binding obligation of the Corporation, and has been registered by the Comptroller. (d) On the Closing Date, one Initial Bond representing the entire principal amount of the Bonds, payable in stated installments to the Purchaser or its designee, executed by manual or facsimile signature of the President and Secretary of the Corporation, approved by the Attorney General of Texas, and registered and manually signed by the Comptroller of Public Accounts of the State of Texas, will be delivered to the Purchaser or its designee. Upon payment for the Initial Bond, the Paying Agent/Registrar shall cancel the Initial Bond and deliver registered definitive Bonds to DTC in accordance with Section 3.10 hereof. Section 3.05. Ownership. (a) The Corporation, the Paying Agent/Registrar and any other person may treat the person in whose name any Bond is registered as the absolute owner of such Bond for the purpose of making and receiving payment of the principal thereof and premium, if any, thereon, for the further purpose of making and receiving payment of the interest -9- #5663887.3 thereon (subject to the provisions herein that interest is to be paid to the person in whose name the Bond is registered on the Record Date), and for all other purposes, whether or not such Bond is overdue, and neither the Corporation nor the Paying Agent/Registrar shall be bound by any notice or knowledge to the contrary. (b) All payments made to the person deemed to be the Owner of any Bond in accordance with this Section shall be valid and effectual and shall discharge the liability of the Corporation and the Paying Agent/Registrar upon such Bond to the extent of the sums paid. Section 3.06. Registration, Transfer and Exchange. (a) So long as any Bonds remain outstanding, the Corporation shall cause the Paying Agent/Registrar to keep at the Designated Payment/Transfer Office a register (the "Register") in which, subject to such reasonable regulations as it may prescribe, the Paying Agent/Registrar shall provide for the registration and transfer of Bonds in accordance with this Resolution. (b) The ownership of a Bond may be transferred only upon the presentation and surrender of the Bond at the Designated Payment/Transfer Office of the Paying Agent/Registrar with such endorsement or other evidence of transfer as is acceptable to the Paying Agent/Registrar. No transfer of any Bond shall be effective until entered in the Register. (c) The Bonds shall be exchangeable upon the presentation and surrender thereof at the Designated Payment/Transfer Office of the Paying Agent/Registrar for a Bond or Bonds of the same maturity and interest rate and in any denomination or denominations of any integral multiple of $5,000 and in an aggregate principal amount equal to the unpaid principal amount of the Bonds presented for exchange. The Paying Agent/Registrar is hereby authorized to authenticate and deliver Bonds exchanged for other Bonds in accordance with this Section. (d) Each exchange Bond delivered by the Paying Agent/ Registrar in accordance with this Section shall constitute an original contractual obligation of the Corporation and shall be entitled to the benefits and security of this Resolution to the same extent as the Bond or Bonds in lieu of which such exchange Bond is delivered. (e) No service charge shall be made to the Owner for the initial registration, subsequent transfer, or exchange for any different denomination of any of the Bonds. The Paying Agent/Registrar, however, may require the Owner to pay a sum sufficient to cover any tax or other governmental charge that is authorized to be imposed in connection with the registration, transfer or exchange of a Bond. (f) Neither the Corporation nor the Paying Agent/Registrar shall be required to issue, transfer, or exchange any Bond called for redemption, in whole or in part, where such redemption is scheduled to occur within forty-five (45) calendar days after the transfer or exchange date; provided, however, such limitation shall not be applicable to an exchange by the Owner of the uncalled principal balance of a Bond. Section 3.07. Cancellation and Authentication. (a) All Bonds paid or redeemed before scheduled maturity in accordance with this Resolution, and all Bonds in lieu of which exchange Bonds or replacement Bonds are authenticated and delivered in accordance with this Resolution, shall be cancelled and destroyed upon the making of proper records regarding such payment, -10- #5663887.3 redemption, exchange or replacement. The Paying Agent/Registrar shall dispose of the cancelled Bonds in accordance with the Securities Exchange Act of 1934. (b) Each substitute or replacement Bond issued pursuant to the provisions of Sections 3.06 and 3.09 of this Resolution, in conversion of and exchange for or replacement of any Bond or Bonds issued under this Resolution, shall have printed thereon a Paying Agent/Registrar's Authentication Certificate, in the form hereinafter set forth. An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, manually sign and date such Certificate, and no such Bond shall be deemed to be issued or outstanding unless such Certificate is so executed. No additional ordinances, orders, or resolutions need be passed or adopted by the Corporation, the governing body of the City, or any other body or person so as to accomplish the foregoing conversion and exchange or replacement of any Bond or portion thereof, and the Paying Agent/Registrar shall provide for the printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said Bonds shall be of customary type and composition and be printed on paper with lithographed or steel engraved borders of customary weight and strength. Pursuant to the Texas Public Securities Procedures Act (Texas Government Code, Chapter 1201, as amended), and particularly Subchapter D thereof, the duty of conversion and exchange or replacement of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of the above Paying Agent/Registrar's Authentication Certificate, the converted and exchanged or replaced Bonds shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Initial Bond which was originally delivered pursuant to this Resolution, approved by the Attorney General, and registered by the Comptroller of Public Accounts. (c) Bonds issued in conversion and exchange or replacement of any other Bond or portion thereof, (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bonds to be payable only to the registered owners thereof, (ii) may be redeemed prior to their scheduled maturities, (iii) may be transferred and assigned, (iv) may be converted and exchanged for other Bonds, (v) shall have the characteristics, (vi) shall be signed, and (vii) the principal of and interest on the Bonds shall be payable, all as provided, and in the manner required or indicated, in the Form of Bonds set forth in this Resolution. Section 3.08. Temporary Bonds. (a) Following the delivery and registration of the Initial Bond and pending the preparation of definitive Bonds, the proper officers of the Corporation may execute and, upon the Corporation's request, the Paying Agent/Registrar shall authenticate and deliver, one or more temporary Bonds that are printed, lithographed, typewritten, mimeographed or otherwise produced, in any denomination, substantially of the tenor of the definitive Bonds in lieu of which they are delivered, without coupons, and with such appropriate insertions, omissions, substitutions and other variations as the officers of the Corporation executing such temporary Bonds may determine, as evidenced by their signing of such temporary Bonds. (b) Until exchanged for Bonds in definitive form, such Bonds in temporary form shall be entitled to the benefit and security of this Resolution. (c) The Corporation, without unreasonable delay, shall prepare, execute and deliver to the Paying Agent/Registrar the Bonds in definitive form; thereupon, upon the presentation and -11- #5663887.3 surrender of the Bond or Bonds in temporary form to the Paying Agent/Registrar, the Paying Agent/Registrar shall cancel the Bonds in temporary form and authenticate and deliver in exchange therefor a Bond or Bonds of the same maturity and series, in definitive form, in the authorized denomination, and in the same aggregate principal amount, as the Bond or Bonds in temporary form surrendered. Such exchange shall be made without the making of any charge therefor to any Owner. Section 3.09. Replacement Bonds. (a) Upon the presentation and surrender to the Paying Agent/Registrar, at the Designated Payment/Transfer Office, of a mutilated Bond, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor a replacement Bond of like tenor and principal amount, bearing a number not contemporaneously outstanding. The Corporation or the Paying Agent/ Registrar may require the Owner of such Bond to pay a sum sufficient to cover any tax or other governmental charge that is authorized to be imposed in connection therewith and any other expenses connected herewith. (b) In the event that any Bond is lost, apparently destroyed or wrongfully taken, the Paying Agent/Registrar, pursuant to the applicable laws of the State of Texas and in the absence of notice or knowledge that such Bond has been acquired by a bona fide purchaser, shall authenticate and deliver a replacement Bond of like tenor and principal amount, bearing a number not contemporaneously outstanding, provided that the Owner first: (i) furnishes to the Paying Agent/Registrar satisfactory evidence of his ownership of and the circumstances of the loss, destruction or theft of such Bond; (ii) furnishes such security or indemnity as may be required by the Paying Agent/Registrar and the Corporation to save them harmless; (iii) pays all expenses and charges in connection therewith, including, but not limited to, printing costs, legal fees, fees of the Paying Agent/Registrar and any tax or other governmental charge that is authorized to be imposed; and (iv) satisfies any other reasonable requirements imposed by the Corporation and the Paying Agent/Registrar. (c) If, after the delivery of such replacement Bond, a bona fide purchaser of the original Bond in lieu of which such replacement Bond was issued presents for payment such original Bond, the Corporation and the Paying Agent/Registrar shall be entitled to recover such replacement Bond from the person to whom it was delivered or any person taking therefrom, except a bona fide purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Corporation or the Paying Agent/Registrar in connection therewith. (d) In the event that any such mutilated, lost, apparently destroyed or wrongfully taken Bond has become or is about to become due and payable, the Paying Agent/Registrar, in its discretion, instead of issuing a replacement Bond, may pay such Bond. (e) Each replacement Bond delivered in accordance with this Section shall constitute an original contractual obligation of the Corporation and shall be entitled to the benefits and -12- #5663887.3 security of this Resolution to the same extent as the Bond or Bonds in lieu of which such replacement Bond is delivered. Section 3.10. Book -Entry Only System. (a) The definitive Bonds shall be initially issued in the form of a separate single fully registered Bond for each of the maturities thereof. Upon initial issuance, the ownership of each such Bond shall be registered in the name of Cede & Co., as nominee of DTC, and, except as provided in Section 3.11 hereof, all of the outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC. (b) With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the Corporation and the Paying Agent/Registrar shall have no responsibility or obligation to any DTC Participant or to any person on behalf of whom such a DTC Participant holds an interest in the Bonds, except as provided in this Resolution. Without limiting the immediately preceding sentence, the Corporation and the Paying Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than an Owner, as shown on the Register, of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than an Owner, as shown in the Register of any amount with respect to principal of, premium, if any, or interest on the Bonds. Notwithstanding any other provision of this Resolution to the contrary, the Corporation and the Paying Agent/Registrar shall be entitled to treat and consider the person in whose name each Bond is registered in the Register as the absolute Owner of such Bond for the purpose of payment of principal of, premium, if any, and interest on the Bonds, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfer with respect to such Bond, and for all other purposes whatsoever. The Paying Agent/Registrar shall pay all principal of, premium, if any, and interest on the Bonds only to or upon the order of the respective Owners, as shown in the Register as provided in this Resolution, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Corporation's obligations with respect to payment of, premium, if any, and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner, as shown in the Register, shall receive a Bond certificate evidencing the obligation of the Corporation to make payments of amounts due pursuant to this Resolution. Upon delivery by DTC to the Paying Agent/Registrar of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions in this Resolution with respect to interest checks or drafts being mailed to the registered Owner at the close of business on the Record Date, the word "Cede & Co." in this Resolution shall refer to such new nominee of DTC. (c) The Representation Letter previously executed and delivered by the Corporation and applicable to the Corporation's obligations delivered in book -entry -only form to DTC as securities depository for said obligations is hereby ratified and approved for the Bonds. Section 3.11. Successor Securities Depository; Transfer Outside. In the event that the Corporation or the Paying Agent/Registrar determines that DTC is incapable of discharging its responsibilities described herein and in the Representation Letter, and that it is in the best interest of the beneficial owners of the Bonds that they be able to obtain certificated Bonds, or in the -13- #5663887.3 event DTC discontinues the services described herein, the Corporation or the Paying Agent/Registrar shall (i) appoint a successor securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants, as identified by DTC, of the appointment of such successor securities depository and transfer one or more separate Bonds to such successor securities depository or (ii) notify DTC and DTC Participants, as identified by DTC, of the availability through DTC of Bonds and transfer one or more separate Bonds to DTC Participants having Bonds credited to their DTC accounts, as identified by DTC. In such event, the Bonds shall no longer be restricted to being registered in the Register in the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor securities depository, or its nominee, or in whatever name or names Owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this Resolution. Section 3.12. Payments to Cede & Co. Notwithstanding any other provision of this Resolution to the contrary, so long as any Bonds are registered in the name of Cede & Co., as nominee of DTC, all payments with respect to principal of, premium, if any, and interest on such Bonds, and all notices with respect to such Bonds, shall be made and given, respectively, in the manner provided in the Representation Letter. ARTICLE IV REDEMPTION OF BONDS BEFORE MATURITY Section 4.01. Limitation on Redemption. The Bonds shall be subject to redemption before scheduled maturity only as provided in this Article IV. Section 4.02. Optional Redemption. (a) The Corporation reserves the option to redeem Bonds maturing on and after February 15, 2028, in whole or in part, before their scheduled maturity date, in integral multiples of $5,000, on February 15, 2027, or on any date thereafter (such redemption date or dates to be fixed by the Corporation) at a price equal to the principal amount of the Bonds called for redemption plus accrued interest from the most recent interest payment date on which interest has been paid or duly provided for to the redemption date. (b) The Corporation, at least 45 days before the redemption date (unless a shorter period shall be satisfactory to the Paying Agent/Registrar), shall notify the Paying Agent/Registrar of such redemption date and of the principal amount of Bonds to be redeemed. Section 4.03. Mandatory Sinking Fund Redemption. (a) The Bonds maturing February 15, 20, February 15, 20, and February 15, 20 (the "Term Bonds") are subject to scheduled mandatory redemption and will be redeemed by the Corporation, in part at a price equal to the principal amount thereof, without premium, plus accrued interest to the redemption date, out of moneys available for such purpose in the Interest and Sinking Fund, on the dates and in the respective principal amounts as set forth below. -14- #5663887.3 $ Term Bonds Maturing February 15, 20 Redemption Date Principal Amount February 15, 20 $ February 15, 20 February 15, 20 February 15, 20 February 15, 20* *maturity $ Term Bonds Maturing February 15, 20 Redemption Date Principal Amount February 15, 20 $ February 15, 20 February 15, 20 February 15, 20 February 15, 20* *maturity $ Term Bonds Maturing February 15, 20 Redemption Date Principal Amount February 15, 20 $ February 15, 20 February 15, 20 February 15, 20 February 15, 20* *maturity (b) At least forty-five (45) days prior to each scheduled mandatory redemption date, the Paying Agent/Registrar shall select for redemption by lot, or by any other customary method that results in a random selection, a principal amount of Term Bonds equal to the aggregate principal amount of such Term Bonds to be redeemed, shall call such Term Bonds for redemption on such scheduled mandatory redemption date, and shall give notice of such redemption. (c) In lieu of calling the Term Bonds described above, for mandatory redemption, the Corporation reserves the right to purchase such Term Bonds at a price not exceeding the principal amount thereof, plus accrued interest, with (a) moneys on deposit in the Interest and Sinking Fund which are available for the mandatory redemption of such Term Bonds or (b) other lawfully available funds. Upon any such purchase in lieu of redemption, not less than forty-five (45) days prior to a mandatory redemption date, the Corporation shall deliver such Term Bonds to the Paying Agent/Registrar prior to the selection of the Term Bonds for redemption and the -15- #5663887.3 principal amount so delivered shall be credited against the amount required to be called for redemption in that year. Section 4.04. Partial Redemption. (a) If less than all of the Bonds are to be redeemed pursuant to Section 4.02, the Corporation shall determine the maturity or maturities and the amounts thereof to be redeemed and shall direct the Paying Agent/Registrar to call by lot Bonds, or portions thereof within such maturity or maturities and in such principal amounts, for redemption. (b) A portion of a single Bond of a denomination greater than $5,000 may be redeemed, but only in a principal amount equal to $5,000 or any integral multiple thereof. The Paying Agent/Registrar shall treat each $5,000 portion of the Bond as though it were a single Bond for purposes of selection for redemption. (c) Upon surrender of any Bond for redemption in part, the Paying Agent/Registrar, in accordance with Section 3.06 of this Resolution, shall authenticate and deliver an exchange Bond or Bonds in an aggregate principal amount equal to the unredeemed portion of the Bond so surrendered, and such exchange shall be without charge, notwithstanding any provision of Section 3.06 to the contrary. (d) The Paying Agent/Registrar shall promptly notify the Corporation in writing of the principal amount to be redeemed of any Bond as to which only a portion thereof is to be redeemed. Section 4.05. Notice of Redemption to Owners. (a) The Paying Agent/Registrar shall give notice of any redemption of Bonds by sending notice by United States mail, first class postage prepaid, not less than 30 days before the date fixed for redemption, to the Owner of each Bond (or part thereof) to be redeemed, at the address shown on the Register at the close of business on the business day next preceding the date of mailing of such notice. (b) The notice shall state the redemption date, the redemption price, the place at which the Bonds are to be surrendered for payment, and, if less than all the Bonds outstanding are to be redeemed, an identification of the Bonds or portions thereof to be redeemed. (c) Any notice given as provided in this Section shall be conclusively presumed to have been duly given, whether or not the Owner receives such notice. Section 4.06. Payment Upon Redemption. (a) Before or on each redemption date, the Paying Agent/Registrar shall make provision for the payment of the Bonds to be redeemed on such date by setting aside and holding in trust an amount from the Interest and Sinking Fund or otherwise received by the Paying Agent/Registrar from the Corporation sufficient to pay the principal of, premium, if any, and accrued interest on such Bonds. (b) Upon presentation and surrender of any Bond called for redemption at the Designated Payment/Transfer Office on or after the date fixed for redemption, the Paying Agent/Registrar shall pay the principal of, premium, if any, and accrued interest on such Bond to the date of redemption from the money set aside for such purpose. -16- #5663887.3 Section 4.07. Effect of Redemption. (a) Notice of redemption having been given as provided in Section 4.04 of this Resolution, the Bonds or portions thereof called for redemption shall become due and payable on the date fixed for redemption and, unless the Corporation defaults in the payment of the principal thereof, premium, if any, or accrued interest thereon, such Bonds or portions thereof shall cease to bear interest from and after the date fixed for redemption, whether or not such Bonds are presented and surrendered for payment on such date. (b) If the Corporation shall fail to make provision for payment of all sums due on a redemption date, then any Bond or portion thereof called for redemption shall continue to bear interest at the rate stated on the Bond until due provision is made for the payment of same by the Corporation. Section 4.08. Conditional Notice of Redemption. The Corporation reserves the right, in the case of an optional redemption pursuant to Section 4.02 herein, to give notice of its election or direction to redeem Bonds conditioned upon the occurrence of subsequent events. Such notice may state (i) that the redemption is conditioned upon the deposit of moneys and/or authorized securities, in an amount equal to the amount necessary to effect the redemption, with the Paying Agent/Registrar, or such other entity as may be authorized by law, no later than the redemption date, or (ii) that the Corporation retains the right to rescind such notice at any time on or prior to the scheduled redemption date if the Corporation delivers a certificate of the Corporation to the Paying Agent/Registrar instructing the Paying Agent/Registrar to rescind the redemption notice and such notice and redemption shall be of no effect if such moneys and/or authorized securities are not so deposited or if the notice is rescinded. The Paying Agent/Registrar shall give prompt notice of any such rescission of a conditional notice of redemption to the affected Owners. Any Bonds subject to conditional redemption and such redemption has been rescinded shall remain Outstanding and the rescission of such redemption shall not constitute an event of default. Further, in the case of a conditional redemption, the failure of the Corporation to make moneys and or authorized securities available in part or in whole on or before the redemption date shall not constitute an event of default. ARTICLE V PAYING AGENT/REGISTRAR Section 5.01. Appointment of Initial Paying A en.Re isg tray. (a) The Bank of New York Mellon Trust Company, N.A. is hereby appointed as the initial Paying Agent/Registrar for the Bonds. Section 5.02. Qualifications. Each Paying Agent/Registrar shall be a commercial bank, a trust company organized under the laws of the State of Texas, or any other entity duly qualified and legally authorized to serve as and perform the duties and services of paying agent and registrar for the Bonds. Section 5.03. Maintaining Paying A end ism. (a) At all times while any Bonds are outstanding, the Corporation will maintain a Paying Agent/Registrar that is qualified under Section 5.02 of this Resolution. The President of the Corporation is hereby authorized and -17- #5663887.3 directed to execute an agreement with the Paying Agent/Registrar specifying the duties and responsibilities of the Corporation and the Paying Agent/Registrar. The signature of the President of the Corporation shall be attested by the Secretary of the Corporation. (b) If the Paying Agent/Registrar resigns or otherwise ceases to serve as such, the Corporation will promptly appoint a replacement. Section 5.04. Termination. The Corporation, upon not less than 60 days' notice, reserves the right to terminate the appointment of any Paying Agent/Registrar by delivering to the entity whose appointment is to be terminated written notice of such termination, provided, that such termination shall not be effective until a successor Paying Agent/Registrar has been appointed and has accepted the duties of Paying Agent/Registrar for the Bonds. Section 5.05. Notice of Change. Promptly upon each change in the entity serving as Paying Agent/Registrar, the Corporation will cause notice of the change to be sent to each Owner and any bond insurer by first class United States mail, postage prepaid, at the address in the Register, stating the effective date of the change and the name and mailing address of the replacement Paying Agent/Registrar. Section 5.06. Agreement to Perform Duties and Functions. By accepting the appointment as Paying Agent/Registrar, and executing the Paying Agent/Registrar Agreement, the Paying Agent/Registrar is deemed to have agreed to the provisions of this Resolution and that it will perform the duties and functions of Paying Agent/Registrar prescribed thereby. Section 5.07. Delivery of Records to Successor. If a Paying Agent/Registrar is replaced, such Paying Agent, promptly upon the appointment of the successor, will deliver the Register (or a copy thereof) and all other pertinent books and records relating to the Bonds to the successor Paying Agent/Registrar. ARTICLE VI FORM OF THE BONDS Section 6.01. Form Generally. (a) The Bonds, including the registration certificate of the Comptroller, the certificate of the Paying Agent/Registrar, and the assignment form to appear on each of the Bonds, (i) shall be substantially in the form set forth in this Article, with such appropriate insertions, omissions, substitutions, and other variations as are permitted or required by this Resolution, and (ii) 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 any reproduction of an opinion of counsel) thereon as, consistently herewith, may be determined by the Corporation or by the officers executing such Bonds, as evidenced by their execution thereof. (b) Any portion of the text of any Bonds may be set forth on the reverse side thereof, with an appropriate reference thereto on the face of the Bonds. -18- #5663887.3 (c) The Bonds shall be typed, printed, lithographed, or engraved, and may be produced by any combination of these methods or produced in any other similar manner, all as determined by the officers executing such Bonds, as evidenced by their execution thereof, except that the Initial Bond submitted to the Attorney General of Texas, the definitive Bonds delivered to DTC (or any successor securities depository) and any temporary Bonds may be typewritten or photocopied or otherwise produced. Section 6.02. Form of Bonds. The form of Bonds, including the form of the registration certificate of the Comptroller, the form of certificate of the Paying Agent/Registrar and the form of assignment appearing on the Bonds, shall be substantially as follows: (a) [Form of Bond] NEITHER THE STATE, THE CITY OF GRAPEVINE, TEXAS (THE "CITY") NOR ANY POLITICAL CORPORATION, SUBDIVISION, OR AGENCY OF THE STATE SHALL BE OBLIGATED TO PAY THIS BOND OR THE INTEREST THEREON 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 OR THE INTEREST ON THIS BOND. REGISTERED No. REGISTERED S United States of America State of Texas GRAPEVINE 4B ECONOMIC DEVELOPMENT CORPORATION SALES TAX REVENUE REFUNDING BOND, TAXABLE SERIES 2018 INTEREST RATE: MATURITY DATE: DELIVERY DATE: CUSIP NUMBER: % February 15, May 15, 2018 Grapevine 4B Economic Development Corporation (the "Corporation"), a non-profit industrial development corporation governed by Chapters 501, 502 and 505, Texas Local Government Code, as amended (the "Act"), in the State of Texas, for value received, hereby promises to pay to or registered assigns, on the Maturity Date specified above, the sum of DOLLARS unless this Bond shall have been sooner called for redemption and the payment of the principal hereof shall have been paid or provision for such payment shall have been made, and to pay -19- #5663887.3 interest on the unpaid principal amount hereof from the later of the Delivery Date specified above or the most recent interest payment date to which interest has been paid or provided for until such principal amount shall have been paid or provided for, at the per annum rate of interest specified above, computed on the basis of a 360 -day year of twelve 30 -day months, such interest to be paid semiannually on February 15 and August 15 of each year, commencing August 15, 2018. The principal of this Bond shall be payable without exchange or collection charges in lawful money of the United States of America upon presentation and surrender of this Bond at the corporate trust office in Dallas, Texas (the "Designated Payment/Transfer Office"), of The Bank of New York Mellon Trust Company, N.A., as initial Paying Agent/Registrar, or, with respect to a successor Paying Agent/Registrar, at the Designated Payment/Transfer Office of such successor. Interest on this Bond is payable by check dated as of the interest payment date, mailed by the Paying Agent/Registrar to the registered owner at the address shown on the registration books kept by the Paying Agent/Registrar or by such other customary banking arrangements acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the person to whom interest is to be paid. For the purpose of the payment of interest on this Bond, the registered owner shall be the person in whose name this Bond is registered at the close of business on the "Record Date," which shall be the close of business on the 15th day of the month next preceding such interest payment date; provided, however, that in the event of nonpayment of interest on a scheduled interest payment date, and for 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 (the "Special Payment Date," which shall be 15 days after the Special Record Date) shall be sent at least five business days prior to the Special Record Date by United States mail, first class postage prepaid, to the address of each Owner of a Bond appearing on the books of the Paying Agent/Registrar at the close of business on the last business day preceding the date of mailing such notice. If a date for the payment of the principal of or interest on the Bonds is a Saturday, Sunday, legal holiday, or a day on which banking institutions in the city in which the Designated Payment/Transfer Office is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not a Saturday, Sunday, legal holiday, or day on which such 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. This Bond dated April 15, 2018, is one of a series of fully registered bonds specified in the title hereof issued in the aggregate principal amount of $ (herein referred to as the "Bonds"), issued pursuant to a certain Resolution of the Board of Directors of the Corporation (the "Resolution") for the purpose of (i) refunding the Refunded Bonds (as defined in the Resolution), (ii) funding a debt service reserve fund; and (iii) paying the costs of issuing the Bonds. This Bond and all the bonds of the series of which it is a part constitute special obligations of the Grapevine 4B Economic Development Corporation and together with any additional parity revenue obligations which the Corporation has reserved the right to issue are -20- #5663887.3 payable as to both principal and interest solely from a first lien on and pledge of the Pledged Revenues and Pledged Funds, as described in the Resolution. The Corporation expressly reserves the right to issue further and additional special revenue obligations on a parity with the bonds of this issue; provided, however, that any and all such additional parity obligations may be issued only in accordance with and subject to the covenants, conditions, limitations and restrictions relating thereto which are set out and contained in the Resolution, to which reference is hereby made for more complete and full particulars. The Corporation has reserved the option to redeem the Bonds maturing on and after February 15, 2028, before their respective scheduled maturity in whole or in part in integral multiples of $5,000 on February 15, 2027, or on any date thereafter, at a price equal to the principal amount of the Bonds so called for redemption plus accrued interest to the redemption date. If less than all of the Bonds are to be redeemed, the Corporation shall determine the maturity or maturities and the amounts thereof to be redeemed and shall direct the Paying Agent/Registrar to call by lot Bonds, or portions thereof within such maturity or maturities and in such amounts, for redemption. Bonds maturing on February 15, in each of the years and , inclusive (the "Term Bonds"), are subject to mandatory sinking fund redemption prior to their scheduled maturity, and will be redeemed by the Corporation, in part at a redemption price equal to the principal amount thereof, without premium, plus interest accrued to the redemption date, on the dates and in the principal amounts shown in the following schedule: $ Term Bonds Maturing February 15, 20 Redemption Date February 15, 20 February 15, 20 February 15, 20 February 15, 20 February 15, 20* *maturity Principal Amount $ Term Bonds Maturing February 15, 20 Redemption Date February 15, 20 February 15, 20 February 15, 20 February 15, 20 February 15, 20* 'maturity -21- #5663887.3 Principal Amount $ Term Bonds Maturing February 15, 20 Redemption Date Principal Amount February 15, 20 $ February 15, 20 February 15, 20 February 15, 20 February 15, 20* *maturity The Paying Agent/Registrar will select by lot or by any other customary method that results in a random selection the specific Term Bonds (or with respect to Term Bonds having a denomination in excess of $5,000, each $5,000 portion thereof) to be redeemed by mandatory redemption. The principal amount of Term Bonds required to be redeemed on any redemption date pursuant to the foregoing mandatory sinking fund redemption provisions hereof shall be reduced, at the option of the Corporation, by the principal amount of any Bonds which, at least 45 days prior to the mandatory sinking fund redemption date (i) shall have been acquired by the Corporation at a price not exceeding the principal amount of such Bonds plus accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar for cancellation, or (ii) shall have been redeemed pursuant to the optional redemption provisions hereof and not previously credited to a mandatory sinking fund redemption. The Corporation reserves the right, in the case of an optional redemption pursuant to the provisions of the Resolution, to give notice of its election or direction to redeem Bonds conditioned upon the occurrence of subsequent events. Such notice may state (i) that the redemption is conditioned upon the deposit of moneys and/or authorized securities, in an amount equal to the amount necessary to effect the redemption, with the Paying Agent/Registrar, or such other entity as may be authorized by law, no later than the redemption date, or (ii) that the Corporation retains the right to rescind such notice at any time on or prior to the scheduled redemption date if the Corporation delivers a certificate of the Corporation to the Paying Agent/Registrar instructing the Paying Agent/Registrar to rescind the redemption notice and such notice and redemption shall be of no effect if such moneys and/or authorized securities are not so deposited or if the notice is rescinded. The Paying Agent/Registrar shall give prompt notice of any such rescission of a conditional notice of redemption to the affected Owners. Any Bonds subject to conditional redemption and such redemption has been rescinded shall remain Outstanding and the rescission of such redemption shall not constitute an Event of Default. Further, in the case of a conditional redemption, the failure of the Corporation to make moneys and or authorized securities available in part or in whole on or before the redemption date shall not constitute an event of default. Notice of such redemption or redemptions shall be sent by United States mail, first class postage prepaid, not less than 30 days before the date fixed for redemption, to the registered owner of each of the Bonds to be redeemed in whole or in part. Notice having been so given, the Bonds or portions thereof designated for redemption shall become due and payable on the -22- #5663887.3 redemption date specified in such notice, and from and after such date, notwithstanding that any of the Bonds or portions thereof so called for redemption shall not have been surrendered for payment, interest on such Bonds or portions thereof shall cease to accrue. As provided in the Resolution, and subject to certain limitations therein set forth, this Bond is transferable upon surrender of this Bond for transfer at the Designated Payment/Transfer Office, with such endorsement or other evidence of transfer as is acceptable to the Paying Agent/Registrar, and, thereupon, one or more new fully registered Bonds of the same stated maturity, of authorized denominations, bearing the same rate of interest, and for the same aggregate principal amount will be issued to the designated transferee or transferees. The Corporation, the Paying Agent/Registrar, and any other person may treat the person in whose name this Bond is registered as the owner hereof for the purpose of receiving payment as herein provided (except interest shall be paid to the person in whose name this Bond is registered on the Record Date or Special Record Date, as applicable) and for all other purposes, whether or not this Bond be overdue, and neither the Corporation nor the Paying Agent/Registrar shall be affected by notice to the contrary. IT IS HEREBY CERTIFIED AND RECITED that the issuance of this Bond and the series of which it is a part is duly authorized by law; that all acts, conditions and things required to be done precedent to and in the issuance of the Bonds have been properly done and performed and have happened in regular and due time, form and manner, as required by law; and that the total indebtedness of the Corporation, including the Bonds, does not exceed any constitutional or statutory limitation. IN WITNESS WHEREOF, this Bond has been duly executed on behalf of the Corporation. Secretary, Grapevine 4B Economic President, Grapevine 4B Economic Development Corporation Development Corporation -23- #5663887.3 (b) [Form of Certificate of Paying Agent/Registrar] CERTIFICATE OF PAYING AGENT/REGISTRAR This is one of the Bonds referred to in the within mentioned Resolution. The series of Bonds of which this Bond is a part was originally issued as one Initial Bond which was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. Dated: (c) [Form of Assignment] THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Paying Agent/Registrar an ASSIGNMENT Authorized Signatory 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 hereof, with full power of substitution in the premises. Date: Signature Guaranteed By: Authorized Signatory (d) Initial Bond Insertions. 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 and must be guaranteed in a manner acceptable to the Paying Agent/Registrar. (i) The Initial Bond shall be in the form set forth in paragraph (a) of this Section, except that: (A) immediately under the name of the Bond, the headings "INTEREST RATE" and "MATURITY DATE" shall both be completed with the words "As Shown Below" and the heading "CUSIP NO. " shall be deleted; -24- #5663887.3 (B) in the first paragraph: the words "on the Maturity Date specified above" shall be deleted and the following will be inserted: "on 0) in the years, in the principal installments and bearing interest at the per annum rates set forth in the following schedule: Years Principal Installments Interest Rates (Information to be inserted from the Pricing Certificate.) (C) the Initial Bond shall be numbered T-1. (ii) The following Registration Certificate of Comptroller of Public Accounts shall appear on the Initial Bond: REGISTRATION CERTIFICATE OF COMPTROLLER OF PUBLIC ACCOUNTS OFFICE OF THE COMPTROLLER § OF PUBLIC ACCOUNTS § REGISTER NO. THE STATE OF TEXAS § I HEREBY CERTIFY THAT there is on file and of record in my office a certificate to the effect that the Attorney General of the State of Texas has approved this Bond, and that this Bond has been registered this day by me. WITNESS MY SIGNATURE AND SEAL OF OFFICE this Comptroller of Public Accounts of the State of Texas [SEAL] Section 6.03. CUSIP Registration. The Corporation may secure identification numbers through the CUSIP Services Bureau managed by Standard & Poor's Financial Services LLC on behalf of the America Bankers Association, and may authorize the printing of such numbers on the face of the Bonds. It is expressly provided, however, that the presence or absence of CUSIP numbers on the Bonds shall be of no significance or effect as regards the legality thereof and neither the Corporation nor the attorneys approving said Bonds as to legality are to be held responsible for CUSIP numbers incorrectly printed on the Bonds. ' To be inserted from the Pricing Certificate. -25- #5663887.3 Section 6.04. Legal Opinion. The approving legal opinion of Bracewell LLP, Bond Counsel, may be printed on the back of or attached to each Bond over the certification of the Secretary of the Corporation, which may be executed in facsimile. Section 6.05. Municipal Bond Insurance. If municipal bond guaranty insurance is obtained with respect to the Bonds, the Bonds, including the Initial Bond, may bear an appropriate legend, as provided by the insurer. To the extent permitted by applicable law, the Corporation will comply with all notice and other applicable requirements of the insurer in connection with the issuance of the Bonds, as such requirements may be in effect and transmitted to the Corporation with the insurer' s commitment to issue such insurance. ARTICLE VII SALE OF THE BONDS; CONTROL AND DELIVERY OF THE BONDS Section 7.01. Sale of Bonds; Official Statement. (a) The Bonds, having been duly advertised and offered for sale at competitive bid, are hereby officially sold and awarded (the "Purchaser") for a purchase price equal to the principal amount thereof plus a cash premium of $ , being the bid which produced the lowest true interest cost to the City. The Initial Bond shall be registered in the name of the Purchaser or its designee. (b) The form and substance of the Preliminary Official Statement for the Bonds and any addenda, supplement or amendment thereto (the "Preliminary Official Statement") and the final Official Statement (the "Official Statement") presented to and considered at this meeting, are hereby in all respects approved and adopted, and the Preliminary Official Statement is hereby deemed final as of its date (except for the omission of pricing and related information) within the meaning and for the purposes of paragraph (b)(1) of Rule 15c2-12 under the Securities Exchange Act of 1934, as amended. The President or Vice President of the Corporation is hereby authorized and directed to execute the Official Statement and deliver appropriate numbers of copies thereof to the Representative. The Official Statement as thus approved, executed and delivered, with such appropriate variations as shall be approved by the President or Vice President of the Corporation and the Representative, may be used by the Purchasers in the public offering of the Bonds and sale thereof. The Corporation Secretary of the Corporation is hereby authorized and directed to include and maintain a copy of the Preliminary Official Statement and the Official Statement and any addenda, supplement or amendment thereto thus approved among the permanent records of this meeting. The use and distribution of the Preliminary Official Statement in the public offering of the Bonds is hereby ratified, approved and confirmed. (c) All officers and officials of the Corporation are authorized to take such actions and to execute such documents, certificates and receipts, and to make such elections with respect to the tax-exempt status of the Bonds, as they may deem necessary and appropriate in order to consummate the delivery of the Bonds. Further, in connection with the submission of the record of proceedings for the Bonds to the Attorney General of the State of Texas for examination and approval of such Bonds, the appropriate officer of the Corporation is hereby authorized and -26- #5663887.3 directed to issue a check of the Corporation payable to the Attorney General of the State of Texas as a nonrefundable examination fee in the amount required by Chapter 1202, Texas Government Code (such amount not to exceed $9,500). (d) The obligation of the Purchaser to accept delivery of the Bonds is subject to the Purchaser being furnished with the final, approving opinion of Bracewell LLP, Bond Counsel for the Corporation, which opinion shall be dated as of and delivered on the Closing Date. The President is hereby authorized and directed to execute the engagement letter with Bracewell LLP, setting forth such firm's duties as Bond Counsel for the Corporation, and such engagement letter and the terms thereof in the form presented at this meeting is hereby approved and accepted. Section 7.02. Control and Delivery of Bonds. (a) The President and Vice -President are hereby authorized to have control of the Initial Bond and all necessary records and proceedings pertaining thereto pending investigation, examination and approval of the Attorney General of the State of Texas, registration by the Comptroller of Public Accounts of the State of Texas, and registration with, and initial exchange or transfer by, the Paying Agent/Registrar. (b) After registration by the Comptroller of Public Accounts, delivery of the Bonds shall be made to the Purchaser under and subject to the general supervision and direction of the President of the Corporation, against receipt by the Corporation of all amounts due to the Corporation under the terms of sale. (c) In the event the President or Board Secretary are absent or otherwise unable to execute any document or take any action authorized herein, the Vice -President of the Board and any Assistant Board Secretary or other member of the Board, respectively, shall be authorized to execute such documents and take such actions, and the performance of such duties by the Vice - President of the Board and any Assistant Board Secretary or other member of the Board shall for the purposes of this Resolution have the same force and effect as if such duties were performed by the President or Board Secretary, respectively. ARTICLE VIII FUNDS AND ACCOUNTS, INITIAL DEPOSITS AND APPLICATION OF MONEY Section 8.01. Creation of Funds. (a) The Corporation hereby confirms and re- establishes the following funds to be held at the Corporation' s depository bank: (i) Project Development Fund; (ii) Debt Service Fund; (iii) Reserve Fund; (iv) Capital Improvement Fund; and (v) Sales Tax Revenue Fund. -27- #5663887.3 (b) Moneys on deposit in the Project Development Fund shall be used for paying costs of Projects for which Parity Revenue Obligations from time to time are issued. The Project Development Fund at all times shall be free of any lien, pledge or trust created by this Resolution and the resolution or resolutions authorizing Additional Parity Obligations. (c) The Sales Tax Revenue Fund is hereby confirmed as a special fund comprised of the Pledged Revenues, together with all other revenues as from time to time may be determined for deposit therein by the Corporation, and shall be maintained at the Corporation's depository bank for the benefit of the Owners of the Parity Revenue Obligations, subject to the further provisions of this Resolution. (d) The Debt Service Fund shall be maintained for the benefit of the Owners of the Parity Revenue Obligations. Money deposited in the Debt Service Fund shall be used to pay the principal of, premium, if any, and interest on the Parity Revenue Obligations when and as the same shall become due and payable. (e) The Reserve Fund shall be maintained for the benefit of the Owners of the Parity Revenue Obligations. Money deposited in the Reserve Fund shall be used to pay principal of and/or interest on Parity Revenue Obligations becoming due and payable when there is not sufficient money available in the Debt Service Fund for such purpose. Money on deposit in the Reserve Fund may be applied to the acquisition of a Reserve Fund Surety Bond. (f) Money from time to time on deposit in the Capital Improvement Fund shall be used for paying costs of authorized Projects the payment of which are not otherwise provided from the proceeds of Parity Revenue Obligations, and for any other lawful purposes permitted under applicable law. The Capital Improvement Fund at all times shall be free of any lien or pledge created by this Resolution and the resolution or resolutions authorizing the issuance Additional Parity Obligations. Section 8.02. Deposit of Proceeds. All amounts received on the Closing Date by the Paying Agent/Registrar for the payment of the purchase price for the Bonds shall be deposited and transferred in accordance with the following: (a) Proceeds of the Bonds in the amount of $ shall be deposited to the Reserve Fund for the Bonds; and (b) Proceeds of the Bonds in the amount of $ (including premium received on the Bonds in the amount of $) shall be deposited with the paying agent/registrar for the Refunded Bonds to refund the Refunded Bonds pursuant to the Deposit Agreement; and (c) The remaining balance received on the Closing Date, shall be deposited to a special account of the Corporation and used for the payment of the costs of issuing the Bonds. Any amounts not needed for the payment of costs of issuance shall be deposited to Debt Service Fund. Section 8.03. Sales Tax Revenue Fund. (a) All Pledged Revenues shall be deposited and transferred as received to the Sales Tax Revenue Fund. #5663887.3 (b) Moneys deposited in the Sales Tax Revenue Fund shall be pledged and appropriated to the following uses, in the order of priority shown: (i) First, to the payment, without priority, of all amounts required to be deposited in the Debt Service Fund herein established for the payment of Parity Revenue Obligations; (ii) Second, to the payment of all amounts required to be deposited in the Reserve Fund pursuant to this Resolution or any resolution relating to the issuance of Parity Revenue Obligations: (iii) Third, to any other fund or account required by any resolution authorizing Parity Revenue Obligations, the amounts required to be deposited therein; (iv) Fourth, to any fund or account, or to any payee, required by any other resolution of the Board which authorizes the issuance of obligations or the creation of debt of the Corporation having a lien on the Pledged Revenues subordinate to the lien and pledge created herein with respect to the Parity Revenue Obligations; and (v) Fifth, to the Capital Improvement Fund. Section 8.04. Debt Service Fund. (a) The Corporation hereby covenants and agrees to make deposits to the Debt Service Fund from moneys in the Sales Tax Revenue Fund, in substantially equal monthly, bi-monthly, quarterly or semi-annual installments as such money is received, to pay the principal of and interest on the Parity Revenue Obligations as follows: (i) Such amounts, on deposit and received following the Closing Date, as will be sufficient, together with other amounts, if any, then on hand in the Debt Service Fund and available for such purpose, to pay the interest scheduled to accrue and become due and payable with respect to the Parity Revenue Obligations on the next succeeding Interest Payment Date; (ii) Such amounts, on deposit and received following the Closing Date, as will be sufficient, together with other amounts, if any, on hand in the Debt Service Fund and available for such purpose, to pay the principal scheduled to mature and come due on the Parity Revenue Obligations on the next succeeding Interest Payment Date on which principal of the Bonds is to be payable. (b) The deposits to the Debt Service Fund for the payment of principal of and interest on the Parity Revenue Obligations shall continue to be made as hereinabove provided until such time as (i) the total amount on deposit in the Debt Service Fund and Reserve Fund is equal to the amount required to pay all outstanding obligations (principal and/or interest) for which said Fund was created and established to pay or (ii) the Parity Revenue Obligations are no longer outstanding, i.e., fully paid as to principal and interest or all of the Parity Revenue Obligations have been refunded. (c) Any proceeds of the Bonds not required for the purposes for which the Bonds are issued shall be deposited to the Debt Service Fund. -29- #5663887.3 Section 8.05. Reserve Fund. (a) The Corporation hereby covenants and agrees with the holders of the Parity Revenue Obligations that it will continuously maintain in the Reserve Fund an amount (hereinafter, the "Required Reserve") equal to the maximum annual principal and interest requirement of the Parity Revenue Obligations (calculated on a Fiscal Year basis as of the date the last series of Parity Revenue Obligations were authorized). The provisions of this Section 8.05 may be modified by the Pricing Certificate. (b) Prior to the delivery of each issue or series of Additional Parity Obligations, the Corporation shall cause the Required Reserve for the Parity Revenue Obligations then outstanding and the proposed Additional Parity Obligations to be calculated and determined. Upon delivery of such Additional Parity Obligations, the Corporation shall deposit into the Reserve Fund, from the proceeds of the Additional Parity Obligations or from other available funds, an amount equal to the difference between the amounts then on deposit in the Reserve Fund and the Required Reserve as calculated in the next preceding sentence. (c) In the event that the amount on deposit in the Reserve Fund is reduced below the Required Reserve, the amount on deposit in the Reserve Fund shall be restored to the Required Reserve by deposit of the Pledged Revenues first available after the deposit required by Section 8.03(b)(i). (d) The Reserve Fund may be funded in the amount of the Required Reserve by the deposit of a Reserve Fund Surety Bond sufficient to provide such portion of the Required Reserve. The Corporation further expressly reserves the right to substitute at any time a Reserve Fund Surety Bond for any funded amounts in the Reserve Fund and to apply the funds thereby released, to the greatest extent permitted by law, to any of the purposes for which the related Parity Revenue Obligations were issued or to pay debt service on the Parity Revenue Obligations. The Corporation shall not employ any Reserve Fund Surety Bond unless (i) the Corporation officially finds that the purchase of such Reserve Fund Surety Bond is cost effective, (ii) the Reserve Fund Surety Bond does not impose upon the Corporation repayment obligations (in the event the Reserve Fund Surety Bond is drawn upon) greater than can be funded from Pledged Revenues on a parity with the deposits that are otherwise required to be made to the Reserve Fund, and (iii) that any interest due in connection with such repayment obligations does not exceed the highest lawful rate of interest which may be paid by the Corporation at the time of delivery of the Reserve Fund Surety Bond. Section 8.06. Deficiencies in Funds. If the Corporation shall, for any reason, fail to pay into the Debt Service Fund or Reserve Fund the full amounts above stipulated, amounts equivalent to such deficiencies shall be set apart and paid into said funds from the first available revenues of the Corporation and such payments shall be in addition to the amounts hereinabove provided to be otherwise paid into said funds. Section 8.07. Security of Funds. All moneys on deposit in the funds referred to in this Resolution shall be secured in the manner and to the fullest extent required by the laws of the State of Texas for the security of funds of the Corporation, and moneys on deposit in such funds shall be used only for the purposes permitted by this Resolution. -30- #5663887.3 Section 8.08. Investments. (a) Money in the funds established by this Resolution, or any resolution authorizing the issuance of the Prior Bonds or any Additional Parity Obligations, at the option of the Corporation, may be invested in such securities or obligations as permitted under the laws of the State of Texas applicable to the Corporation. (b) Any securities or obligations in which money is so invested shall be sold and the proceeds of sale shall be timely applied to the making of all payments required to be made from the fund from which the investment was made. Section 8.09. Investment Income. Interest and income derived from investment of any fund created by this Resolution shall be credited to such fund. ARTICLE IX ADDITIONAL OBLIGATIONS Section 9.01. Issuance of Superior Lien Obligations Prohibited. The Corporation hereby covenants that so long as any principal or interest pertaining to any Parity Revenue Obligations remain outstanding and unpaid, it will not authorize or issue obligations secured by a lien on or pledge of the Pledged Revenues superior to the lien ascribed to the Parity Revenue Obligations. Section 9.02. Issuance of Additional Parity Obligations Authorized. In addition to the right to issue obligations of inferior lien, the Corporation reserves the right to issue Additional Parity Obligations which, when duly authorized and issued in compliance with law and the terms and conditions hereinafter appearing, shall be on a parity with the Bonds herein authorized, payable from and equally and ratably secured by a lien on and pledge of the Pledged Revenues and Pledged Funds; and the Bonds and Additional Parity Obligations shall in all respects be of equal dignity. The Additional Parity Obligations may be issued in one or more installments, provided, however, that none shall be issued unless and until the following conditions have been met: (a) The Corporation is not then in default as to any covenant, condition or obligation prescribed in a resolution authorizing the issuance of the outstanding Parity Revenue Obligations. (b) Each of the funds created for the payment, security and benefit of the Parity Revenue Obligations contains the amount of money then required to be on deposit therein. (c) The Corporation has secured from a Certified Public Accountant a certificate or report reflecting that for the Fiscal Year next preceding the date of the proposed Additional Parity Obligations, or a consecutive twelve (12) month period out of the fifteen (15) month period next preceding the month in which the resolution authorizing the proposed Additional Parity Obligations is adopted, the Pledged Sales Tax revenues were equal to at least 1.20 times the combined maximum annual principal and interest requirements on all Parity Revenue Obligations to be outstanding after the issuance of the proposed Additional Parity Obligations. (d) The Additional Parity Obligations are made to mature on an Interest Payment Date of each year in which they are scheduled to mature. -31- #5663887.3 (e) The resolution authorizing the Additional Parity Obligations provides that: (i) the Debt Service Fund be augmented by amounts adequate to accumulate the sum required to pay the principal and interest on such obligations as the same shall become due; and (ii) the amount to be maintained in the Reserve Fund shall be increased to an amount not less than the Required Reserve calculated to include the debt service of the proposed additional obligations; and (iii) any additional amount required to be maintained in the Reserve Fund shall be deposited therein upon delivery of such Additional Parity Obligations. (f) Parity Revenue Obligations may be refunded upon such terms and conditions as the Board may deem to be in the best interest of the Corporation; and if less than all such outstanding Parity Revenue Obligations are refunded, the proposed refunding obligations shall be considered as "Additional Parity Obligations" under the provisions of this Section, and the report or certificate required by paragraph (c) shall give effect to the issuance of the proposed refunding obligations and shall not give effect to the obligations being refunded. ARTICLE X PARTICULAR REPRESENTATIONS AND COVENANTS Section 10.01. Pledged Funds and Pledged Revenues. (a) The Corporation represents and warrants that it is and will be authorized by applicable law and by its articles of incorporation and bylaws to authorize and issue the Bonds, to adopt this Resolution and to pledge the Pledged Funds and Pledged Revenues in the manner and to the extent provided in this Resolution, and that the Pledged Funds and Pledged Revenues so pledged 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 for Parity Revenue Obligations. (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 the terms of this Resolution, subject only to any applicable bankruptcy or insolvency laws or to any applicable law affecting creditors' rights generally. (c) The Corporation shall at all times, to the extent permitted by applicable law, defend, preserve and protect the pledge of the Pledged Funds and Pledged Revenues and all the rights of the Owners under this Resolution and the resolutions authorizing the issuance of the Prior Bonds and any Additional Parity Obligations, against all claims and demands of 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 and other applicable law. Section 10.02. Accounts, Periodical Reports and Certificates. (a) The Corporation shall keep or cause to be kept proper books of record and account (separate from all other records and accounts) in which complete and correct entries shall be made of its transactions relating to the funds and accounts established by this Resolution and which, together with all other books and -32- #5663887.3 papers of the Corporation, shall at all times be subject to the inspection of, the Owner or Owners of not less than 5% in principal amount of the Parity Revenue Obligations then outstanding or their representatives duly authorized in writing. (b) The Corporation shall annually, within 120 days after the close of each Fiscal Year, mail or cause to be mailed to any Holder owning at least 25% of the outstanding Parity Revenue Obligations of a single series who so requests in writing, a copy of an annual report for said year containing the following statements in reasonable detail with respect to the Corporation: a balance sheet as of the end of said year and the preceding year, statements of revenue and expense and of changes in financial position for the year then ended and the preceding year setting forth revenues and expenses for such years in accordance with generally accepted accounting principles. Section 10.03. General. The Directors and Officers of the Corporation shall do and perform or cause to be done and performed all acts and things required to be done or performed by or on behalf of the Corporation under the provisions of this Resolution. Section 10.04. Repeal of Power to Collect Sales Tax. Any repeal or amendment of the right and power to levy, collect and apply the Sales Tax pursuant to the Act shall never be effective until all of the principal of and the interest on the Obligations, and the interest on the Parity Revenue Obligations have been paid in full or they have been lawfully defeased under Section 12.01. Section 10.05. Payment of the Bonds. While any of the Bonds are outstanding and unpaid, there shall be made available to the Paying Agent/Registrar, out of the Debt Service Fund, money sufficient to pay the interest on and the principal of the Bonds, as applicable, as will accrue or mature on each applicable Interest Payment Date. ARTICLE XI DEFAULT AND REMEDIES Section 11.01. Events of Default. Each of the following occurrences or events for the purpose of this Resolution is hereby declared to be an "Event of Default," to -wit: (i) the failure to make payment of the principal of or interest on any of the Bonds when the same becomes due and payable; (ii) default in the performance or observance of any other covenant, agreement or obligation of the Corporation, the failure to perform which materially, adversely affects the rights of the Owners, including but not limited to, their prospect or ability to be repaid in accordance with this Resolution, and the continuation thereof for a period of 30 days after notice of such default is given by any Owner to the Corporation; or (iii) An order of relief shall be issued by the Bankruptcy Court of the United States District Court having jurisdiction, granting the Corporation any relief under any Applicable Law, or any other court having valid jurisdiction shall issue an order or decree -33- #5663887.3 under applicable federal or state law providing for the appointment of a receiver, liquidator, assignee, trustee, sequestrator, or other similar official for the Corporation as applicable, of any substantial part of its property, affairs or assets, and the continuance of any such decree or order unstayed and in effect for a period of 90 consecutive days. Section 11.02. Remedies for Default. (a) Upon the happening of any Event of Default, then and in every case any Owner or an authorized representative thereof, including but not limited to, a trustee or trustees therefor, may proceed against the Corporation for the purpose of protecting and enforcing the rights of the Owners under this Resolution, by mandamus or other suit, action or special proceeding in equity or at law, in any court of competent jurisdiction, for any relief permitted by law, including the specific performance of any covenant or agreement contained herein, or thereby to enjoin any act or thing that may be unlawful or in violation of any right of the Owners hereunder or any combination of such remedies. (b) It is provided that all such proceedings shall be instituted and maintained for the equal benefit of all Owners of Bonds then outstanding. Section 11.03. Remedies Not Exclusive. (a) No remedy herein conferred or reserved is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given hereunder or under the Bonds or now or hereafter existing at law or in equity; provided, however, that notwithstanding any other provision of this Resolution, the right to accelerate the debt evidenced by the Bonds shall not be available as a remedy under this Resolution. (b) The exercise of any remedy herein conferred or reserved shall not be deemed a waiver of any other available remedy. ARTICLE XII DISCHARGE Section 12.01. Discharge. The Bonds may be defeased, discharged or refunded either (i) by depositing with the Comptroller of Public Accounts of the State a sum of money equal to the principal of, premium, if any, and all interest to accrue on the Bonds to maturity or redemption or (ii) by depositing with the Paying Agent/Registrar or other lawfully authorized entity amounts sufficient, together with the investment earnings thereon, to provide for the payment and/or redemption of the Bonds; provided that such deposits may be invested and reinvested only in (a) direct obligations of the United States of America, including obligations that are unconditionally guaranteed by the United States of America and (b) noncallable obligations of an agency or instrumentality of the United States, including obligations that are unconditionally guaranteed or insured by the agency or instrumentality and that, on the date the governing body of the Corporation adopts or approves the proceedings authorizing the issuance of refunding obligations, are rated as to investment quality by a nationally recognized investment rating firm not less than "AAA" or its equivalent; or (iii) any combination of (i) and (ii) above. -34- #5663887.3 ARTICLE XIII PAYMENT OF REFUNDED BONDS; REDEMPTION OF REFUNDED BONDS; APPROVAL OF DEPOSIT AGREEMENT Section 13.01. Deposit Agreement. The Deposit Agreement, in substantially the form presented at this meeting, and its execution and delivery by the President of the Board is hereby authorized and approved. The signature of the President of the Board shall be attested by the Secretary of the Board. Section 13.02. Redemption and Payment of Refunded Bonds. The Refunded Bonds are hereby called for redemption on the dates, in the principal amounts and at a redemption price equal to the principal amount thereof plus interest accrued thereon to the redemption dates all as set forth on Schedule I hereto. Following the deposit with the paying agent/registrar for the Refunded Bonds pursuant to the Deposit Agreement as herein specified, the Refunded Bonds shall be payable solely from and secured by the cash and/or securities on deposit in the Escrow Fund. Section 13.03. Notice of Deposit and Redemption. The Secretary of the Board is hereby authorized to cause notice of redemption to be given to the paying agent/registrar for the Refunded Bonds by delivery of a certified copy of this Resolution. The paying agent/registrar for the Refunded Bonds is hereby authorized and directed to give notice of deposit and notice of redemption with respect to the Refunded Bonds as required under the resolution pursuant to which the Refunded Bonds were issued. ARTICLE XIV LAPSE OF PAYMENT Section 14.01. Lapse of Payment. (a) Unclaimed Payments shall be segregated in a special escrow account and held in trust, uninvested, by the Paying Agent/Registrar for the account of the Owner of the Bonds to which the Unclaimed Payments pertain. (b) Subject to Title 6, Texas Property Code, Unclaimed Payments remaining unclaimed by the Owners entitled thereto for three years after the applicable payment or redemption date shall be applied to the next payment or payments on the Bonds thereafter coming due, and, to the extent any such money remains after the retirement of all outstanding Bonds, shall be paid to the Corporation to be used for any lawful purpose. Thereafter, neither the Corporation, the Paying Agent/Registrar nor any other person shall be liable or responsible to any Owners of such Bonds for any further payment of such unclaimed moneys or on account of any such Bonds, subject to Title 6, Texas Property Code. -35- #5663887.3 ARTICLE XV CONTINUING DISCLOSURE UNDERTAKING Section 15.01. Definitions of Continuing Disclosure Terms. (a) As used in this Article, the following terms have the meanings assigned to such terms below: Section 15.02. Annual Reports. (a) The Corporation shall cause the City to provide annually to the MSRB, (1) within six months after the end of each fiscal year of the Corporation, financial information and operating data with respect to the Corporation of the general type included in the final Official Statement in Tables 1-5, including financial statements of the City if audited financial statements of the City are then available, and (2) if not provided as part such financial information and operating data, audited financial statements of the City within 12 months after the end of each fiscal year, when and if available. Any financial statements to be provided shall be (i) prepared in accordance with the accounting principles appended to the Official Statement, or such other accounting principles as the City may be required to employ from time to time pursuant to state law or regulation, and (ii) audited, if the City commissions an audit of such financial statements and the audit is completed within the period during which they must be provided. If the audit of such financial statements is not complete within 12 months after any such fiscal year end, then the Corporation shall file unaudited financial statements within such 12 -month period and audited financial statements for the applicable fiscal year, when and if the audit report on such statements becomes available. (b) If the City or Corporation changes its fiscal year, it will notify the MSRB of the change (and of the date of the new fiscal year end) prior to the next date by which the City or Corporation otherwise would be required to provide financial information and operating data pursuant to this Section. (c) The financial information and operating data to be provided pursuant to this Section may be set forth in full in one or more documents or may be included by specific reference to any document (including an official statement or other offering document, if it is available from the MSRB) that theretofore has been provided to the MSRB or filed with the SEC. Section 15.03. Disclosure Event Notices. (a) The Corporation shall notify the MSRB, in a timely manner not in excess of ten (10) Business Days after the occurrence of the event, of any of the following events with respect to the Bonds: (i) Principal and interest payment delinquencies; (ii) Non-payment related defaults, if material; (iii) Unscheduled draws on debt service reserves reflecting financial difficulties; -36- #5663887.3 (iv) Unscheduled draws on credit enhancements reflecting financial difficulties; (v) Substitution of credit or liquidity providers, or their failure to perform; (vi) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; (vii) Modifications to rights of holders of the Bonds, if material; (viii) Bond calls, if material, and tender offers; (ix) Defeasances; (x) Release, substitution, or sale of property securing repayment of the Bonds, if material; (xi) Rating changes; (xii) Bankruptcy, insolvency, receivership or similar event of the Corporation;' (xiii) The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the Corporation, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; and (xiv) Appointment of a successor Paying Agent/Registrar or change in the name of the Paying Agent/Registrar, if material. (b) The Corporation shall provide to the MSRB, in an electronic format as prescribed by the MSRB, in a timely manner, notice of a failure by the Corporation to provide required annual financial information and notices of material events in accordance with Section 15.02 and section (a) above. All documents provided to the MSRB pursuant to this section shall be accompanied by identifying information, as prescribed by the MSRB, and will be available via EMMA at www.emma.msrb.org. (2) For the purposes of the event identified in (xii), the event is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for an obligated person in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the obligated person, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the obligated person. -37- #5663887.3 Section 15.04. Limitations, Disclaimers and Amendments. (a) The Corporation and the City shall be obligated to observe and perform the covenants specified in this Article for so long as, but only for so long as, the Corporation and the City remain an "obligated person" with respect to the Bonds within the meaning of the Rule, except that the Corporation in any event will give notice of any deposit made in accordance with Article XII that causes Bonds no longer to be Outstanding. (b) The provisions of this Article are for the sole benefit of the Owners and beneficial owners of the Bonds, and nothing in this Article, express or implied, shall give any benefit or any legal or equitable right, remedy, or claim hereunder to any other person. The Corporation undertakes to provide only the financial information, operating data, financial statements, and notices which it has expressly agreed to provide pursuant to this Article and does not hereby undertake to provide any other information that may be relevant or material to a complete presentation of the Corporation's financial results, condition, or prospects or hereby undertake to update any information provided in accordance with this Article or otherwise, except as expressly provided herein. The Corporation does not make any representation or warranty concerning such information or its usefulness to a decision to invest in or sell Bonds at any future date. UNDER NO CIRCUMSTANCES SHALL THE CORPORATION OR THE CITY BE LIABLE TO THE OWNER OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CORPORATION OR THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS ARTICLE, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE. (c) No default by the Corporation in observing or performing its obligations under this Article shall comprise a breach of or default under the Resolution for purposes of any other provisions of this Resolution. (d) Nothing in this Article is intended or shall act to disclaim, waive, or otherwise limit the duties of the Corporation under federal and state securities laws. (e) The provisions of this Article may be amended by the Corporation from time to time to adapt to changed circumstances that arise from a change in legal requirements, a change in law, or a change in the identity, nature, status, or type of operations of the Corporation, but only if (1) the provisions of this Article, as so amended, would have permitted an underwriter to purchase or sell Bonds in the primary offering of the Bonds in compliance with the Rule, taking into account any amendments or interpretations of the Rule to the date of such amendment, as well as such changed circumstances, and (2) either (a) the Owners of a majority in aggregate principal amount (or any greater amount required by any other provisions of this Resolution that authorizes such an amendment) of the outstanding Bonds consent to such amendment or (b) a person that is unaffiliated with the Corporation (such as nationally recognized bond counsel) determines that such amendment will not materially impair the interests of the Owners and beneficial owners of the Bonds. If the Corporation so amends the provisions of this Article, it -38- #5663887.3 shall include with any amended financial information or operating data next provided in accordance with Section 14.02 an explanation, in narrative form, of the reasons for the amendment and of the impact of any change in the type of financial information or operating data so provided. ARTICLE XVI AMENDMENTS Section 16.01. Amendments. This Resolution shall constitute a contract with the Owners, be binding on the Corporation, and shall not be amended or repealed by the Corporation so long as any Bond remains outstanding except as permitted in this Section. The Corporation may, without consent of or notice to any Owners, from time to time and at any time, amend this Resolution in any manner not detrimental to the interests of the Owners, including the curing of any ambiguity, inconsistency, or formal defect or omission herein. In addition, the Corporation may, with the written consent of the Owners of the Bonds holding a majority in aggregate principal amount of the Bonds then outstanding, amend, add to, or rescind any of the provisions of this Resolution; provided that, without the consent of all Owners of outstanding Bonds, no such amendment, addition, or rescission shall (i) extend the time or times of payment of the principal of and interest on the Bonds, reduce the principal amount thereof, the redemption price, or the rate of interest thereon, or in any other way modify the terms of payment of the principal of or interest on the Bonds, (ii) give any preference to any Bond over any other Bond, or (iii) reduce the aggregate principal amount of Bonds required to be held by Owners for consent to any such amendment, addition, or rescission. Section 16.02. Attorney General Modification. In order to obtain the approval of the Bonds by the Attorney General of the State of Texas, any provision of this Resolution may be modified, altered or amended after the date of its adoption if required by the Attorney General in connection with the Attorney General's examination as to the legality of the Bonds and approval thereof in accordance with the applicable law. Such changes, if any, shall be provided to the Board Secretary and the Board Secretary shall insert such changes into this Resolution as if approved on the date hereof. -39- #5663887.3 ADOPTED AND EFFECTIVE this day of April, 2018. President, Grapevine 4B Economic Development Corporation ATTEST: Secretary, Grapevine 4B Economic Development Corporation Signature Page of Resolution #5663887.3 SCHEDULE I SCHEDULE OF REFUNDED BONDS* Sales Tax Revenue Refunding Bonds, Taxable Series 2014 Principal Principal Interest Amount Amount Dated Date Maturity Date Rate Outstanding Refunded 1/15/2014 2/15/2019 3.070% $ 715,000 $ 715,000 2/15/2020 3.590% 740,000 740,000 2/15/2021 4.030% 770,000 770,000 2/15/2022 4.410% 800,000 800,000 2/15/2023 4.710% 840,000 840,000 2/15/2024 4.960% 880,000 880,000 2/15/2025 5.110% 925,000 925,000 2/15/2026 5.260% 975,000 975,000 2/15/2027 5.410% 1,030,000 1,030,000 2/15/2028 5.560% 1,085,000 1,085,000 2/15/2029 5.710% 1,150,000 1,150,000 2/15/2030 5.840% 1,220,000 1,220,000 2/15/20341) 5.990% 5,665,000 5,665,000 $16,795,000 $16,795,000 The 2019 - 2034 maturities will be redeemed prior to original maturity on May 17, 2018 at par plus accrued interest. (') Represents a Term Bond with mandatory sinking fund redemptions on February 15 in the years 2031, 2032, 2033 and a final maturity of February 15, 2034. Schedule I #5663887.3