HomeMy WebLinkAboutItem 16 - Aero DFW ProjectITEM 1P
MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: ROGER NELSON, CITY MANAGER'
MEETING DATE: FEBRUARY 5, 2002
SUBJECT: AERO DFW PROJECT
RECOMMENDATION:
City Council to consider approving a resolution approving the action of the Grapevine
Industrial Development Corporation for its Senior Air Cargo Revenue Bonds, Series 2002
(Cargo Acquisition Company, LLC Obligated Group).
FUNDING SOURCE:
The direct cost to the City is minimal and is covered by a fee of three-quarters of one
percent of the total amount of issuance (estimated at $45,000). All direct costs of issuance
will be born by the company.
BACKGROUND:
On December 12, 2001 the Industrial Development Corporation Board approved a
resolution expressing intent to issue tax-exempt bonds in the amount of approximately
$6,500,000 and to authorize reimbursement of expenditures incurred prior to the issuance
of the bonds. Representatives of Aero DFW, a freight forwarding company met with the
board and provided information describing their proposed project for the DFW Airport area.
The company will acquire the leasehold interest of facilities known as Cargo Buildings A,
B, C and D at DFW Airport, which includes an aggregate of approximately 160,000 square
feet of space. This is one of several similar projects which are being undertaken at six
airports nationwide at a total cost of approximately $89,000.000.
In order for the bond sale to take place, both the Industrial Development Corporation and
the City Council must approve authorizing resolutions. The IDC is scheduled to hold a
public hearing and consider their resolution at a meeting immediately prior to this Council
meeting. This agenda item is a resolution which wold approve the action of the IDC Board
to authorize bonds not to exceed $6,000,000.
The bonds are corporate obligations of the company and are not secured by any funds or
revenues of either the Industrial Development Corporation or the City. The company has
agreed to pay all costs of issuance and a fee of three-quarters of one percent of the total
January 31, 2002 (3:31 PM)
issuance amount as a fee to cover staff time and other miscellaneous costs associated
with issuance of the bonds.
The City Attorney has reviewed and approved the facts. Mr. Ben Brooks, bond counsel
from Vinson and Elkins will be present at the meeting along with a representative from the
company to respond to questions. A copy of Mr. Brooks' memorandum presented to the
Board is attached.
If this action is approved by the City Council, the bonds will be priced and sold along with
the other bonds by the other nine issuers in mid to late February.
If the City Council wishes to proceed with the bond issuance, approval of the resolution is
recommended.
WAG/cjc
H:IDCAeroDFW2-05-02
January 31, 2002 (3:31 PM)
Vmson&ElkinS
ATTORNEYS AT LAW
0
January 16, 2002
VINSON & ELKINS L.L.P.
3700 TRAMMELL CROW CENTER
2001 ROSS AVENUE
DALLAS, TEXAS 75201-2975
TELEPHONE (214) 220-7700
FAX (214) 220-7716
www.velaw.com
Ben Brooks
Direct Dial 214-220-7921
Direct Fax 214-999-7921
bbrooks@velaw.com
com
TO: Members of the Board of Directors of Grapevine Industrial Development
Corporation/ City Council of the City of Grapevine, Texas
FROM: Vinson & Elkins L.L.P., Bond Counsel
RE: Grapevine Industrial Development Corporation Senior Air Cargo Revenue
Bonds, Series 2002 (Cargo Acquisition Company, LLC Obligated Group)
In connection with the captioned financing, enclosed is the Resolution (the "Issuer
Resolution") of the Board of Directors (the "Board") of the Grapevine Industrial Development
Corporation (the "Issuer") entitled:
RESOLUTION AUTHORIZING GRAPEVINE INDUSTRIAT
DEVELOPMENT CORPORATION SENIOR AIR CARGO REVENUE
BONDS, SERIES 2002 (CARGO ACQUISITION COMPANY, LLC
OBLIGATED GROUP); APPROVING A FINANCING AGREEMENT, A
TRUST INDENTURE, AN OFFICIAL STATEMENT AND A CONTRACT OF
PURCHASE; AND OTHER MATTERS IN CONNECTION THEREWITH
The following is a summary of the Project to be financed by issuance of the above -
referenced bonds (the "Series 2002 Bonds ") and each of the basic documents utilized in the
transaction, all of which are to be authorized and approved by adoption of the Issuer Resolution:
PROJECT
Description of Project. The proceeds of the Series 2002 Bonds will be loaned to Aero
DFW, LP, a Delaware limited partnership (the "Company") to (i) finance the costs of acquisition,
construction, reconstruction, improvement and expansion of certain air cargo facilities at DFW
International Airport (the "Airport"), and located within the corporate boundaries of the City of
Grapevine, Texas (the "Project"), more particularly described in the Agreement (defined below),
and (ii) pay costs of issuance, including any insurance policy, if any, of the Series 2002 Bonds.
The Company has leased, and will improve, six warehouse and cargo facilities from the Airport,
which the Company will sublease to passenger airlines such as Continental Airlines and more
than 15 other tenants in the air cargo industry. The Project will be managed by Aeroterm U.S.,
Inc., a Delaware corporation.
AUSTIN * BEIJING • DALLAS HOUSTON - LONDON • MOSCOW • NEW YORK • SINGAPORE - WASHINGTON, D.C.
GRA328/10000
Memo to the Board and the City Council re the financing
Page 2
January 16, 2002
Plan of Financingfor the Pro'ect. On December 12 2001 the Bo
1 and passed and
approved a resolution, which, in part, declared the intent of the Issuer to proceed with the
issuance of tax-exempt revenue bonds for the purposes described above. In March, 2002, the
Company anticipates issuing its Master Indenture Senior Promissory Note (the "Series 2002
Note") under the Master Trust Indenture (described below) in an amount not to exceed
$6,000,000 for the purpose of securing the Issuer's Series 2002 Bonds in a like aggregate
principal amount.
_Relationship of Project to National Financing. The Grapevine Project is part of a larger
financing involving similar warehouse and cargo facilities located at approximately 10 airports
across the United States. These various projects will be leased by separate but related single
purpose entities (the "Affiliates") and financed by bonds to be issued by separate governmental
bodies. Each separate series of bonds, including the Series 2002 Bonds, will be marketed and
sold in concert. In addition, each separate series of bonds, including the Series 2002 Bonds, will
be cross -collateralized, with the revenues generated by each local project to be pooled and held
in trust under the Master Trust Indenture to secure each bond issue. The Series 2002 Bonds and
the majority of the other bonds will be issued on a "senior" basis, and thus will have first claim
on revenues held under the Master Trust Indenture, while certain of the other bonds will be
issued on a "subordinate" basis with a subordinate lien on those revenues.
SERIES 2002 BONDS
y , The proceeds of the sale of the Series 2002 Bonds, excluding any accrued interest, will be
loaned by the Issuer to the Company to (i) finance the costs of the Project and (ii) pay the costs
of the issuance of the Series 2002 Bonds, all as described above. The Series 2002 Bonds
constitute limited obligations of the Issuer and (i) are issued pursuant to the terms and conditions
of a Trust Indenture (described below), and (ii) are payable solely from payments required to be
made by the Company pursuant to a Financing Agreement (described below) and a pooled
resource of revenues deposited pursuant to the Master Trust Indenture (described below) by the
Company and the Affiliates. Except as described above, neither the State of Texas, the City nor
the Issuer will be obligated to make payments on the Bonds.
'FRUST INDENTURE
The Series 2002 Bonds are to be issued pursuant to a Trust Indenture (the "Indenture"),
between the Issuer and Bank One, National Association, as trustee (the "Trustee"). The
Indenture establishes the terms and conditions for issuance of the Series 2002 Bonds (i.e., the
date of the bonds, maturity dates for the bonds, form of the bonds, redemption provisions, etc.).
In addition thereto, the Indenture (a) establishes certain funds for disposition of: (i) the proceeds
received from the sale of the Series 2002 Bonds, (ii) payments made by the Company pursuant to
the terms and conditions of the Financing Agreement, and (iii) moneys received from investment
of proceeds of the Series 2002 Bonds; (b) defines certain events of default under the Indenture
and further establishes certain remedies in connection therewith; (c) defines the duties and
liabilities of the Trustee under the Indenture; and (d) establishes certain procedures for
supplementing the Indenture and amending the Agreement.
Page 3
January 16, 2002
FINANCING AGREEMENT
The Series 2002 Bonds are payable out of the revenues derived by the Issuer from the
Company pursuant to a Financing Agreement (the "Agreement"), between the Issuer and the
Company. The Agreement sets forth the terms and conditions by which the loan of the proceeds
of the Series 2002 Bonds will be made by the Issuer to the Company. In addition, the Issuer and
the Company make certain representations, warranties and covenants in the Agreement with
respect to their existence and the intended use of the proceeds of the Series 2002 Bonds.
PROMISSORY NOTE
The Issuer's right to receive payments under the Agreement is evidenced by the Series
2002 Note executed by the Company and made payable to the Trustee to secure the payment of
the Series 2002 Bonds, The Trustee as the holder of the Series 2002 Note will be entitled to the
benefit of certain covenants of the Company as set forth in the Master Trust Indenture (described
below). The Series 2002 Note will also be secured by a Mortgage on the leasehold facilities in
favor of the Trustee.
MASTER TRUST INDENTURE
The Series 2002 Note is to be issued pursuant to the terms and conditions of a Master
Trust Indenture, as supplemented by a First Supplement to Master Trust Indenture (collectively,
the "Master Indenture"), among the Company, the Affiliates and Bank One, National
Association, as master trustee. In addition to its establishing the terms and conditions upon
which the Series 2002 Note is to be issued, the Master Indenture also provides for the issuance of
other notes issued by the Affiliates in connection with the issuance of the Series 2002 Note. In
connection therewith, the Master Indenture sets forth certain requirements (i.e., form of
securities, redemption procedures, duties of master trustee, etc.) upon which such notes may be
issued. The Master Indenture also requires the Company to make certain covenants with respect
to its continued existence and its ability to incur additional debt.
CONTRACT OF PURCHASE
The Series 2002 Bonds are to be sold pursuant to the terms and conditions of a Contract
of Purchase dated the date of its execution and delivery (the "Contract of Purchase"), among the
Issuer, the Company and Salomon Smith Barney (the "Underwriter"). In addition, the Contract
of Purchase (i) requires the Issuer and the Company to make certain representations, warranties
and covenants in connection with the sale and delivery of the Series 2002 Bonds, and (ii)
authorizes the preparation and distribution of a Preliminary Official Statement and Official
Statement to be used by the Underwriter in their marketing of the Series 2002 Bonds.
Page 4
January 16, 2002
TEFRA HEARING
Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code") requires
that a public hearing (the "Tefra Hearing") be held with respect to the Series 2002 Bonds and the
use of proceeds thereof to finance the Project, and that a notice of such hearing be published no
less 14 days before the date of the hearing, in a newspaper of general circulation available to
residents of the City. The hearing gives the public the opportunity to express their views on the
Series 2002 Bonds and the Project. The notice of public hearing was published in the Fort -Worth
Star Telegram on January 18, 2002. The public hearing will be held at the Board's meeting on
February 5, 2002, prior to consideration of the Issuer's Resolution.
CITY APPROVAL
The City, pursuant to the Development Corporation Act of 1979, Texas Revised Civil
Statutes Annotated, Article 5190.6, as amended (the "Act"), has approved and provided for the
creation of the Issuer and is required by the Act to approve the issuance of any bonds issued by
the Issuer. Section 147(f) of the Code also requires that the Series 2002 Bonds and the financing
of the Project be approved by the "applicable elected representative" (the "Representative") of
the City after the public hearing. The City Council, acting as the Representative, will be asked to
adopt a written resolution specifically approving the Issuer's Resolution providing for the
issuance of the Series 2002 Bonds as required by the Code and the Act. A copy of the City's
proposed resolution is attached 'hereto.
We respectfully request the consideration by the Board of the Issuer Resolution and the
City Council of the City's Resolution at their respective February 5, 2002 meetings.
CITY OF GRAPEVINE RESOLUTION NO.
A RESOLUTION APPROVING THE ACTION OF THE GRAPEVINE
INDUSTRIAL DEVELOPMENT CORPORATION FOR ITS SENIOR AIR
CARGO REVENUE BONDS, SERIES 2002 (CARGO ACQUISITION
COMPANY, LLC OBLIGATED GROUP).
WHEREAS, by resolution, the City Council (the "City Council") of the City of
Grapevine, Texas (the "City"), authorized and approved the creation of the Grapevine Industrial
Development Corporation (the "Issuer") as a nonprofit industrial development corporation under
the provisions of the Development Corporation Act of 1979, Texas Revised Civil Statutes
Annotated, Article 5190.6, as amended (the "Act");
WHEREAS, the Act authorizes and empowers the Issuer to issue industrial development
revenue bonds on behalf of the City to pay all or part of the cost of projects pursuant to the Act;
WHEREAS, Aero DFW, LP (the `Borrower"), desires that the Issuer issue its Senior Air
Cargo Revenue Bonds, Series 2002 (Cargo Acquisition Company, LLC Obligated Group) (the
"Bonds"), in an amount not to exceed $6,000,000, as special limited obligations of the Issuer and
loan the proceeds thereof to the Borrower to finance the acquisition, construction, reconstruction,
improvement and expansion of certain leasehold air cargo facilities located at Dallas/Fort Worth
International Airport (the "Project");
WHEREAS, on February 5, 2002, the Board of Directors of the Issuer (the "Board")
adopted a resolution authorizing issuance of the Bonds and approving transaction documents
related thereto (the "Issuer Resolution");
WHEREAS, in connection with the proposed issuance of the Bonds, the City Council has
been presented with an Official Statement, a proposed Trust Indenture, a proposed Financing
Agreement, and a proposed Contract of Purchase, which documents include descriptions of (1)
the type of project, including the type of facilities to be provided; (2) the size of the Project and
its major components; (3) the location of the proposed Project; (4) the present ownership of the
location of the proposed Project; (5) the ownership of the proposed Project upon completion and
commencement of operations; and (6) the use of the location of the proposed Project;
WHEREAS, section 147(f) of the Internal Revenue Code of 1986, as amended (the
"Code"), requires that the Bonds be approved by the "applicable elected representative" (the
"Representative") after a public hearing following reasonable public notice;
WHEREAS, with respect to the Bonds, the Representative shall be the City Council;
WHEREAS, notice of a public hearing with respect to the Project and the Bonds which
was held by the duly appointed hearing officer of the Issuer on February 5, 2002, was published
no less than 14 days before said date, in a newspaper of general circulation available to residents
within the City, to be evidenced by the Affidavit of Publication attached to the Issuer's
Certificate of Public Hearing;
Grapevine City Resolution
WHEREAS, the Issuer has held such public hearing on the date and at the time and place
set out in such published notice, and conducted such hearing in a manner that provided a
reasonable opportunity for persons with differing views on the issuance of the Bonds and on the
location and nature of the Project to be heard;
WHEREAS, the Bonds are being issued pursuant to the Issuer Resolution to finance the
costs of the Project and costs of issuance, all as more fully provided in the above referenced
Financing Agreement;
WHEREAS, the Act and the Bylaws of the Issuer provide that the City Council must, by
written resolution adopted no more than 60 days prior to the date of the proposed delivery of the
Bonds, specifically approve the Issuer Resolution providing for the issuance of the Bonds; and
WHEREAS, the City Council finds and determines that the Project is furtherance of the
public purposes of the Act and therefore desires to approve the action of the Issuer in relation to
financing the Project for the Borrower.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF GRAPEVINE, TEXAS, THAT:
Section 1. Findings. The statements contained in the preamble to this Resolution are
hereby adopted as findings of fact and as part of the operative provisions hereof.
Section 2. Approval of Resolution. The "Resolution Authorizing Grapevine
Industrial Development Corporation Senior Air Cargo Revenue Bonds, Series 2002 (Cargo
"au
Acquisition Company, LLC Obligated Group); Approving a Financing Agreement, a Trust
Indenture, an Official Statement and a Contract Of Purchase; and Other Matters in Connection
Therewith," adopted by the Board on February 5, 2002, a copy of which is attached hereto as
Exhibit A and made a part hereof for all purposes, and providing for the issuance of "Grapevine
Industrial Development Corporation Senior Air Cargo Revenue Bonds, Series 2002 (Cargo
Acquisition Company, LLC Obligated Group)" in an aggregate amount not to exceed $6,000,000
is hereby specifically approved.
Section 3. Hearing. The City Council, acting solely in its capacity as Representative
for purposes of the approval requirements of section 147(f) of the Code and for no other purpose,
is authorized to approve, and does hereby approve, the Bonds. Such approval is not to be
construed as (i) a representation or warranty by the City Council or the City, the State of Texas,
or any other agency, instrumentality, or political subdivision of the State of Texas that the Bonds
will be paid or that any obligations assumed by any of the parties under the instruments delivered
in connection with the Bonds will in fact be performed, (ii) a pledge of faith and credit of or by
the City or the State of Texas or any agency, instrumentality or political subdivision of the State
of Texas or the City, or (iii) a representation or warranty by the City concerning the validity of
the corporate existence of the Issuer or the validity of the Bonds.
Section 4. Other Actions. The Mayor and the City Secretary of the City and the
other appropriate officers of the City are hereby jointly and severally authorized to execute and
deliver such endorsements, instruments, certificates, documents, or papers necessary and
advisable to carry out the intent and purposes of this resolution.
Grapevine City Resolution
Section 5. Open MeetiLig. It is hereby found, determined and declared that a
sufficient written notice of the date, hour, place and subject of the meeting of the City Council at
which this Resolution was adopted was posted at a place convenient and readily accessible at all
times to the general public at the City Hall of the City for the time required by law preceding this
meeting, as required by the Texas Open Meetings Act, Government Code Chapter 551, and that
the meeting has been open to the public as required by law at all times during which this
Resolution and the subject matter thereof have been discussed, considered and formally acted
upon. The City Council further ratifies, approves and confirms such written notice and the
contents and posting thereof.
Section 6. Effective Date. This Resolution shall take effect immediately upon its
adoption.
Grapevine City Resolution
0 ADOPTED THIS 5TH DAY OF FEBRUARY, 2002
ATTEST:
City Secretary
City of Grapevine, Texas
(Seal)
City Attorney
City of Grapevine, Texas
ua«
Mayor, City of Grapevine, Texas
Signature Page to City Resolution
Al
RESOLUTION AUTHORIZING GRAPEVINE INDUSTRIAL
DEVELOPMENT CORPORATION SENIOR AIR CARGO
REVENUE BONDS, SERIES 2002 (CARGO ACQUISITION
COMPANY, LLC OBLIGATED GROUP); APPROVING A
FINANCING AGREEMENT, A TRUST INDENTURE, AN
OFFICIAL STATEMENT AND A CONTRACT OF
PURCHASE; AND OTHER MATTERS IN CONNECTION
THEREWITH
WHEREAS, the City of Grapevine, Texas (the "City"), has, pursuant to the Development
Corporation Act of 1979, Texas Revised Civil Statutes Annotated, Article 5190.6, as amended
(the "Act"), approved and provided for the creation of the Grapevine Industrial Development
Corporation (the "Issuer") as a non -stock, non-profit corporation;
WHEREAS, the Issuer, on behalf of the City, is empowered to finance the costs of
projects located within the boundaries of the City to promote the development and expansion of
manufacturing, industrial and transportation facilities to promote and encourage employment and
the public welfare by the issuance of obligations of the Issuer;
WHEREAS, Aero DFW, LP, a Delaware limited partnership (the 'Borrower"), has
requested that the Issuer issue its revenue bonds and lend the proceeds thereof to the Borrower to
finance the cost of a Project (defined below) to be located within the boundaries of the City;
WHEREAS, no public funds or credit of the City may be pledged to the payment of such
revenue bonds, and such revenue bonds shall be payable solely from amounts made available by
the Borrower or facility for which such bonds are issued;
WHEREAS, in furtherance of the purposes of the Act, the Issuer proposes to issue its
revenue bonds in the aggregate principal amount not to exceed $6,000,000, which will be
designated "Grapevine Industrial Development Corporation Senior Air Cargo Revenue Bonds,
Series 2002 (Cargo Acquisition Company, LLC Obligated Group)" (the "Bonds"), the proceeds
of which will be loaned to the Borrower to finance the costs of acquisition, construction,
reconstruction, improvement and expansion of certain air cargo facilities (the "Project") more
particularly described in the Agreement (defined below), together with certain costs incident to
the issuance of the Bonds;
WHEREAS, the requirements of Section 147(f) of the Internal Revenue Code of 1986, as
amended (the "Code"), provide that a public hearing in connection with the proposed issuance of
the Bonds and the use of the proceeds thereof to finance the Project be held, and that notice of
such hearing be published no less than 14 days before the date of the public hearing in a
newspaper of general circulation available to residents within the City;
WHEREAS, notice of a public hearing with respect to the Project and the Bonds was
published more than 14 days before the date hereof, which is the hearing date, in a newspaper of
general circulation available to residents within the City;
Issuer Resolution Authorizing the Bonds
WHEREAS, the public hearing was held on the date and time and place set forth in the
published notice, at which time the public had the opportunity to express their views with respect
to the proposed financing to be authorized by this Resolution;
WHEREAS, Section 147(f) of the Code requires that the Bonds and the financing of the
Project be approved by the "applicable elected representative" (the "AER") of the City after a
public hearing following reasonable public notice;
WHEREAS, the City Council of the City proposes to adopt a written resolution
specifically approving this Resolution of the Issuer providing for the issuance of the Bonds as
required by the Act; and
WHEREAS, there have been presented to the Issuer proposed forms of each of the
following:
1. Financing Agreement (the "Agreement") between the Issuer and the Borrower;
2. Trust Indenture (the "Indenture") between the Issuer and Bank One, National
Association, as trustee (the "Trustee");
3. Preliminary Official Statement relating to the Bonds (the "Preliminary Official
Statement"); and
4. The bond purchase agreement or contract of purchase (the "Contract of
Purchase") among the Issuer, the Company and Salomon Smith Barney, as
underwriter (the "Underwriter");
The Agreement, the Indenture and the Contract of Purchase are collectively referred to
herein as the "Transaction Documents;"
NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE
GRAPEVINE INDUSTRIAL DEVELOPMENT CORPORATION:
Section 1. The Board hereby approves the Transaction Documents in substantially
the form and substance presented to the Board and the President or any Vice President of the
Issuer is hereby authorized and directed, for and on behalf of the Issuer, to date, sign, and
otherwise execute the Transaction Documents, and the Secretary or any Assistant Secretary is
authorized and directed, for and on behalf of the Issuer, to attest the Transaction Documents, and
such officers are hereby authorized to deliver the Transaction Documents.
Section 2. The Board hereby approves and authorizes the Bonds to be issued in the
aggregate principal amount not to exceed $6,000,000 according to the conditions set forth herein
and in the Indenture for the purpose of providing funds for costs of the Project. The President or
his designee is hereby authorized to act on behalf of the Board in selling and delivering the
Bonds and carrying out the other procedures specified in this Resolution, including determining
the price at which the Bonds will be sold, the years in which the Bonds will mature, the principal
amount to mature in each of such years, the rate of interest to be borne by each such maturity, the
aggregate principal amount of the Bonds, the first interest payment date, the dates, prices and
Issuer Resolution Authorizing the Bonds -2-
terms upon and at which the Bonds shall be subject to redemption prior to maturity at the option
of the Board, as well as any mandatory sinking fund redemption provisions, the purchase of a
Bond insurance policy for all or any portion of the Bonds, and all matters relating to the
issuance, sale of the Bonds and other procedures relating to the Bonds. Such approval shall be
evidenced by the execution of the Indenture and the Contract of Purchase by the authorized
officers of the Issuer.
Section 3. The Board hereby approves the Bonds in substantially the form and
substance set forth in the Indenture and the President and any Vice President and the Secretary or
any Assistant Secretary are hereby authorized and directed, for and on behalf of the Issuer, to
execute the Bonds or have their facsimile signatures placed upon the Bonds and to submit the
Bonds and a transcript of proceedings therefor to the Attorney General for the State of Texas for
approval and to the Comptroller of Public Accounts of the State of Texas for registration, and
such officers are hereby authorized and directed to deliver the Bonds, and the seal of the Issuer is
hereby authorized and directed to be affixed or placed in facsimile on the Bonds.
Section 4. The Board hereby approves the use of the information regarding the Issuer
described under the caption "THE ISSUERS" in the Preliminary Official Statement; provided
that the Issuer hereby disclaims any responsibility for the Preliminary Official Statement except
for the information concerning the Issuer provided under the caption "THE ISSUERS."
Section 5. Based solely upon representations made by the Borrower to the Board, the
Board hereby finds that:
(a) the Project will have the effect of increasing or stabilizing employment
within the City;
(b) the Project is required or suitable for the promotion of development and
expansion of transportation facilities and is in furtherance of the public
purposes of the Act; and
(c) all requirements for and prerequisites to final approval under the Issuer's
Local Regulations for Receiving and Approving Applications for
Financial Participation in Development Projects (the "Regulations") have
either been satisfied or waived and are in form and substance satisfactory
to this Board.
Section 6. The issuance of the Bonds by the Issuer shall be subject to and
conditioned upon the receipt by the Issuer, on or before the closing date of (i) a certificate from a
representative of the Texas Department of Economic Development (the "Department"), acting on
behalf of the Department, evidencing approval of the Bonds; (ii) approval of the Bonds and
Project by the City Council of the City; (iii) the approving opinion of the Attorney General of the
State of Texas and evidence of registration of the Bonds by the Comptroller of Public Accounts
of the State of Texas; (iv) the purchase price for the Bonds; (v) the Issuer's Administrative fee
equal to 3/4 of 1% of the principal amount of the Bonds; and (vi) such opinions, evidences,
certificates, instruments or other documents as shall be requested by Bond Counsel to evidence
Issuer Resolution Authorizing the Bonds - 3 -
due performance or satisfaction by the Borrower at or prior to such time of all agreements then to
be performed and all conditions then to be satisfied by it.
Section 7. The Board hereby approves (i) the submission of an application to the
Department for its approval relating to the issuance, sale and delivery of the Bonds, and (ii) the
submission to the Attorney General of the State of Texas for its approval relating to the issuance,
sale and delivery of the Bonds.
Section 8. The Trustee is hereby appointed to serve as trustee under the Indenture,
thereby serving as Paying Agent under the terms of the Indenture.
Section 9. The President, any Vice President, or the Secretary is hereby authorized to
execute and deliver to the Trustee the written order or application of the Issuer for the
authentication and delivery of the Bonds by the Trustee in accordance with the Indenture.
Section 10. All action (not inconsistent with provisions of this Resolution) heretofore
taken by the Board and officers of the Issuer directed toward the issuance of the Bonds and the
loan of the proceeds thereof to the Borrower to finance the costs of the Project shall be and the
same hereby is ratified, approved, and confirmed.
Section 11. The officers of the Issuer shall take all action necessary or reasonably
required to effectuate the issuance of the Bonds and take all action necessary or desirable to
provide for the loan of the proceeds thereof to finance the Project and for carrying out, giving
3 effect to, and consummating the transactions contemplated by the Bonds and this Resolution,
including without limitation, the execution and delivery of any closing documents in connection
with the issuance of the Bonds.
Section 12. The President and any Vice President are hereby authorized to approve
such changes to said documents as are necessary and appropriate to carry out the purposes of this
Resolution as may be approved by counsel to the Issuer, including such changes as are necessary
to assure that no Additional Bonds (as defined in the Indenture) may be issued without the
express authorization of the Issuer.
Section 13. After any of the bonds are issued, this Resolution shall be and remain
irrepealable until the Bonds or the interest thereon shall have been fully paid or provision for
payment shall have been made pursuant to the Indenture.
Section 14. If any section, paragraph, clause, or provision of the Resolution, or any
application thereof, shall be held to be invalid or unenforceable, the invalidity or
unenforceability of such section, paragraph, clause, or provision or application thereof shall not
affect any of the remaining provisions or applications of this Resolution. In case any obligation
of the Issuer authorized or established by this Resolution or the Bonds is held to be in violation
of law as applied to any person or in any circumstance, such obligation shall be deemed to be the
obligation of the Issuer to the fullest extent permitted by law.
Issuer Resolution Authorizing the Bonds -4-
ADOPTED this 5th day of February, 2002.
GRAPEVINE INDUSTRIAL
DEVELOPMENT CORPORATION
0
ATTEST:
C. Shane Wilbanks
Secretary
Ted R. Ware
President
Issuer Resolution Authorizing the Bonds EXECUTION PAGE