R-2012-055-2012-04-30RESOLUTION NO. 2012-55
RESOLUTION OF THE CITY OF PEARLAND, TEXAS, APPROVING THE ISSUANCE OF
$56,915,000 DEVELOPMENT AUTHORITY OF PEARLAND TAX INCREMENT
CONTRACT REVENUE AND REFUNDING BONDS, SERIES 2012; APPROVING A BOND
RESOLUTION, INDENTURE OF TRUST, A PRIVATE PLACEMENT LETTER, ESCROW
AGREEMENT AND OTHER DOCUMENTS RELATING TO THE BONDS; MAKING
CERTAIN FINDINGS AND CONTAINING OTHER PROVISIONS RELATED THERETO
STATE OF TEXAS
COUNTIES OF BRAZORIA AND HARRIS
CITY OF PEARLAND
WHEREAS, by City Ordinance No. 891, the City of Pearland, Texas (the "City") created
Reinvestment Zone Number Two, City of Pearland, Texas (the "Zone") pursuant to Chapter 311,
Texas Tax Code (the "TIRZ Act"); and
WHEREAS, by Resolution No. 2004-107 adopted by the City Council of the City on
June 28, 2004, the City authorized the creation of the Development Authority of Pearland (the
"Authority") as a local government corporation pursuant to Subchapter D of Chapter 431, Texas
Transportation Code (the "LGC Act"), to aid, assist and act on behalf of the City in the
performance of the City's governmental and proprietary functions with respect to the common
good and general welfare of the Zone; and
WHEREAS, by City Ordinance No. R2004-170, the City authorized an agreement with
the Zone and the Authority (the "Tri -Party Agreement"), which sets forth, among other things,
the duties and responsibilities of the Authority, the City and the Zone as they relate to
reimbursements for Project Costs (as defined in the Indenture) in the Zone, and pursuant- to
which the City and the Zone have agreed to pay the Authority on an annual basis certain of the
Tax Increments (as defined in the Indenture) then available in the Tax Increment Fund (as
defined in the Indenture); and
WHEREAS, the Tri -Party Agreement authorizes the Authority to issue bonds secured by
payments made to the Authority under the Tri -Party Agreement and further authorizes the
Authority to issue such bonds for the purpose of making developer reimbursements for Project
Costs only with the approval of the City; and
WHEREAS, the Authority has previously issued its $13,995,000 Tax Increment Contract
Revenue Bonds, Series 2004, (the "Series 2004 Bonds"), its $9,775,000 Tax Increment Contract
Revenue Bonds, Series 2005 (the "Series 2005 Bonds"), its $9,970,000 Tax Increment Contract
Revenue Bonds, Series 2006 (the "Series 2006 Bonds"), its $15,950,000 Tax Increment Contract
Revenue Bonds, Series 2007 (the "Series 2007 Bonds"); and its $8,815,000 Tax Increment
Contract Revenue Bonds, Series 2009 (the "Series 2009 Bonds") (collectively, the "Refunded
HOU:3211404.2
Bonds"); and now desires to refund the Refunded Bonds in order to restructure the Authority's
debt; and
WHEREAS, the Authority desires to issue its Tax Increment Contract. Revenue and.
Refunding Bonds, Series 2012 in the aggregate principal amount of $56,915,000 (the "Bonds")
pursuant to a resolution authorizing the issuance of the Bonds (the "Bond Resolution") adopted
by the Authority on April 30, 2012, and the Authority desires to use the proceeds from the sale of
such Bonds for the purposes of (1) refunding the Refunded Bonds; (2) paying Project Costs
(which includes amounts owed to developers under certain development agreements and the
acquisition and the construction of certain public works and public improvements within the
Zone), and (3) paying costs of issuance of the Bonds, all under and pursuant to the authority of
the Act and all other applicable law; and
WHEREAS, in order to further secure the Bonds, the Authority has determined to enter
into an Indenture of Trust (the "Indenture") with Wells Fargo Bank, National Association (the
"Trustee") for the purpose of assigning and pledging to the Trustee the Contract Tax Increments
(as defined in the Indenture), for the purpose of establishing the Pledged Revenue Fund, the
Project Fund, the Debt Service Fund, and the Debt Service Reserve Fund pursuant hereto and
thereby providing the Pledged Revenues (as defined in the Indenture) to be held by the Trustee to
secure the payment of principal of and interest on the Bonds and any Additional Parity Bonds
from time to time issued under the Indenture and the Bond Resolutions; and
WHEREAS none of the proceeds of the Bonds shall be used for the purpose of paying or
otherwise providing for educational facilities, and
WHEREAS the City Council desires to approve the issuance of the Authority's Tax
Increment Contract Revenue and Refunding Bonds, Series 2012; Now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS THAT:
Section 1. Preamble. The facts and recitations set out in the preamble of this Resolution
are found to be true and correct and are hereby adopted and made a part hereof for all purposes.
Section 2. Approval of Bonds; Authorization of Agreements; Approval of
Reimbursements. City Council hereby approves the issuance of the Bonds by the Authority and
all reasonable agreements necessary in connection with the issuance of the Bonds, including
without limitation the following: the Indenture (attached hereto as Exhibit A), the Private
Placement Letter with Capital One, N.A. (attached hereto as Exhibit B), the Escrow Agreement
(attached hereto as Exhibit C) and any and all other documents and agreements reasonable and
necessary for the Authority to issue the Bonds (collectively, the "Agreements"). City Council
hereby reconfirms its prior approval of certain developer reimbursements and acknowledges that
a portion of the proceeds from the sale of the Bonds will be used to make such reimbursements.
Section 3. Approval of Bond Resolution. City Council hereby approves the Authority's
Bond Resolution authorizing the issuance of the Authority's $56,915,000 Development
Authority of Pearland Tax Increment Contract Revenue and Refunding Bonds, Series 2012, a
copy of which is attached hereto as Exhibit D.
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HOU:321 1404.2
Section 4. Authorization of Other Matters Relating Thereto. The Mayor, City Secretary
and other officers and agents of the City are hereby authorized and directed to do any and all
things necessary or desirable to carry out the provisions of this Resolution.
Section 5. Effective Date. This Resolution shall take effect immediately upon passage.
Section 6. Public Meeting. It is officially found, determined and declared that the
meeting at which this Resolution is adopted was open to the public and public notice of the time,
place and subject matter of the public business to be considered at such meeting, including this
Resolution, was given all as required by the Texas Government Code, Chapter 551, as amended.
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HOU:3211404.2
PASSED AND APPROVED this 30 day of April, 2012.
ATTEST:
HOU:3211404.2
Mayor
City of Pearland
CAPITAL ONE PUBLIC FUNDING, LLC
April 30, 2012
Board of Directors
Development Authority of Pearland
Re: Development Authority of Pearland (the "Authority")
$56,915,000 Tax Increment Contract Revenue and Refunding Bonds,
Series 2012
Board Members:
Subject to the conditions stated herein, Capital One Public Funding, LLC (the
"Purchaser"), hereby agrees to purchase the Authority's Tax Increment Contract
Revenue and Refunding Bonds, Series 2012, in the principal amount of $56,915,000 at
par (the "Bonds").
The Bonds will bear interest at a rate of 3.07 percent per annum from the date of
delivery until, but not including, May 17, 2022, and thereafter will bear interest at the
lesser of (a) the highest rate permitted by applicable law; (b) 6.0 percent per annum; or
(c) 65% of the three, six, nine or twelve month LIBOR Rate plus 2.0 percent per annum,
which LIBOR Rate and corresponding rate period may be adjusted every three months,
every six months, every nine months or every twelve months at the election of the
Authority. The Bonds will have the terms and redemption provisions and be secured as
described in the Authority's Resolution authorizing the issuance of the Bonds (the
"Bond Resolution") and the Indenture of Trust, as may be supplemented, securing the
Bonds (the "Indenture"). The Authority reserves the right to redeem or refund the
bonds as provided in the Bond Resolution and the Indenture.
Purchaser's agreement to purchase, and the Authority's agreement to sell, the
Bonds are subject to Purchaser's receipt, on or before the date of purchase, of the
following: .
1.The duly executed Bonds payable to the order of Purchaser (which may be
delivered to the Paying Agent/Registrar on behalf of the Purchaser);
2.The opinion of Allen Boone Humphries Robinson LLP, Houston, Texas
and Andrews Kurth LLP, Houston, Texas to the effect that (i) the
Indenture and the Bond Resolution have been authorized, executed and
delivered by the Authority and constitute valid and binding obligations of
the Authority; (ii) the Bonds have been authorized, executed, issued and
delivered by the Authority, and are the legal and valid special obligations
382971_2.doc
of the Authority and are entitled to the benefits and security of the
Indenture; and (iii) the interest on the Bonds is exempt from federal
income taxation under existing statutes, regulations, published rulings,
and court decisions existing on the date of said opinion;
3.Certified copies of the Bond Resolution and Indenture;
4.Certified copies of the approval of the City of Pearland, Texas (the "City);
5.A copy of the agreement between the City, the Zone, and the Authority
(the "Tri-Party Agreement") and the City Ordinance approving the Tri-
Party Agreement; and
7.The Authority's certification to the effect that no litigation of any nature is
then pending against, or to the best knowledge of the certifying directors,
threatened against the Authority contesting or attacking the Bonds;
restraining or enjoining the authorization, execution, or delivery of the
Bonds; affecting the provisions made for the payment of or security for the
Bonds; in any manner questioning the authority of proceedings for the
authorization, execution or delivery of the Bonds; or affecting the validity
of the Bonds, the Bond Resolution, the Indenture, the corporate existence
of the Authority, or the titles of the then present directors of the Board.
8.A certificate reflecting a Captured Appraised Value which, at the
Participants' current tax rates, will generate Contract Tax Increments that
will be at least 125 percent of projected Average Annual Debt Service of
the Bonds. Capitalized in the preceding sentence shall have the meaning
ascribed thereto in the Indenture.
Purchaser recognizes that the Bonds constitute limited obligations of the
Authority and are payable solely from the Contract Tax Increments, as defined in the
Indenture, and certain funds on deposit with the Trustee, as defined in the Indenture,
together with earnings and investments thereon (collectively, the "Pledged Revenues").
Purchaser recognizes that the Bonds are not payable from any other funds of the
Authority other than the Pledged Revenues. Purchaser further recognizes that the
Bonds are limited obligations solely of the Authority and are not obligations of the City
and do not give rise to a charge against the general credit or taxing powers of the City,
Brazoria County, Fort Bend County, Alvin Independent School District, the State of
Texas or any entity other than the Authority.
Purchaser recognizes that the Bonds involve risks and has made such inspection
and investigation of the Authority and its affairs as it deemed necessary to determine
the investment quality of the Bonds. Purchaser represents and warrants that:
1.Purchaser is acquiring the Bonds for its own account as evidence of a loan
and has no present intention to reoffer the Bonds as a bondhouse, broker,
dealer or other person acting as underwriter or wholesaler.
2.Purchaser is an "accredited investor" within the meaning of section 2(15)
of the Securities Act of 1933 and/or a "qualified institutional buyer" as
defined in Rule 144A under the Securities Act of 1933, as amended.
3.Purchaser has had an opportunity to make its own investigation of the
condition of the Authority and the financial risks associated with the
purchase and ownership of the Bonds and has evaluated fully such risks.
Purchaser has had access to all information to which a reasonable investor
would attach significance in making an investment decision with respect
to the purchase of the Bonds.
4.Purchaser recognizes that the Authority has represented that the Bonds
are high risk investments which are suitable only for sophisticated and
well informed investors with sufficient knowledge and experience in
financial and business matters to evaluate the merits and risks involved in
the purchase and ownership of the Bonds.
5.Purchaser assures the Authority that it is a sophisticated and well
informed investor. Purchaser acknowledges that the Bonds are not
suitable for ordinary investors and, accordingly, will not make any sale or
distribution to any person or entity except to a person or entity who is
able to and does confirm in writing to Purchaser and the Authority the
representations contained in paragraphs (1) through (4) and this
paragraph to the same extent as if such paragraphs referred to such
person or entity.
6.Purchaser is familiar with the creation, operation and financing of local
government corporations created under Chapter 431, Subchapter D of the
Texas Transportation Code, and tax increment reinvestment zones created
under Chapter 311, Texas Tax Code. Purchaser further represents that it is
familiar with the practice in the City of using local government
corporations to administer and operate tax increment reinvestment zones
and to issue tax increment contract revenue bonds to pay for the projects
of tax increment reinvestment zones.
7.Purchaser is able and willing to bear the economic risk of the purchase
and ownership of the Bonds. Purchaser further understands and
acknowledges that the Bonds and any interest thereon are payable solely
from and to the extent of the Pledged Revenues and no other Authority
funds shall be encumbered, pledged, committed or used to pay the Bonds
or interest accrued thereon.
Notwithstanding anything herein to the contrary, the Purchaser's obligation to
purchase the Bonds shall be subject to the condition precedent that from the date hereof
to the date of delivery of the Bonds, there shall not have occurred. any: (i) material
adverse change in the financial condition or general affairs of the Authority;. (ii) event,
court decision, proposed law or rule which may have the effect of changing the federal
income tax incidents of the Bonds or the interest thereon or the transaction
contemplated herein; or (iii) international or national crisis, suspension of stock
exchange trading or banking moratorium materially affecting, in the Purchaser's
opinion, the market value of the Bonds.
In consideration of the purchase of the Bonds by the Purchaser, the Authority
agrees to provide the Purchaser with audited annual financial statements and copies of
any annual financial information that is otherwise required to be provided by the
Authority in connection with its continuing disclosure undertakings entered into
pursuant to United States Securities and Exchange Commission Rule 15c2-12 (the
"Rule"), if any, with respect to other bonds of the Authority, each within 180 days after
each fiscal year end. The parties hereto acknowledge and agree that the Purchaser is
not a participating underwriter within the meaning of the Rule. The Authority further
agrees to provide the Purchaser with copies of any annual report prepared by the City
under Section 311.016, Texas Tax Code, within 30 days after the City's deadline to
prepare the report.
Purchaser has not provided, and will not provide, financial, legal, tax, accounting
or other advice to or on behalf of the Authority with respect to the Bonds and the
Authority has not relied on the Purchaser for such advice.
[EXECUTION PAGES FOLLOW]
Respectfully submitted,
CAPITAL ONE PUBLIC FUNDING, LLC
The above and foregoing offer is hereby accepted by Development Authority of
Pearland, as of the 30 th day of April, 2012.
Chairman, Board of Directors
ATTEST:
Secretary, Board of Directors
GENERAL CERTIFICATE
STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
We, the undersigned, Chair and Secretary of the Development Authority of Pearland (the
"Authority"), hereby make and execute this certificate for the benefit of all persons interested in the
Authority's $56,915,000 Tax Increment Contract Revenue and Refunding Bonds, Series 2012 (the
"Bonds"), dated May 1, 2012, now in the process of issuance. Capitalized terms not defined herein
are those defined in the Resolution authorizing the issuance of the Bonds. We certify that:
1.WHEREAS, by Ordinance No. 891, adopted on December 21, 1998, the City of
Pearland (the "City") created Reinvestment Zone Number Two, City of Pearland, Texas (the
"TIRZ") pursuant to Chapter 311, Texas Tax Code, and approved a preliminary project plan for
the TIRZ and a preliminary reinvestment zone financing plan for the TIRZ; and
2.The City, by Resolution No. 2004-107, duly adopted on June 28, 2004, authorized
the creation of the Authority to aid, assist and act on behalf of the City in the performance of the
City's governmental and proprietary functions with respect to, and to provide financing for, the
TIRZ.
3.WHEREAS, by Ordinance No. R2004-170, adopted on October 11, 2004, the
City approved that certain Agreement by and between the City, the TIRZ, and the Authority (the
"Tri-Party Agreement"), pursuant to which the City delegated to the Authority the power and
authority to issue, sell or deliver its bonds, notes or other obligations in accordance with the
terms of the Tri-Party Agreement; and
4.Attached hereto as Exhibit A and Exhibit B, respectively, is a true, correct, and
complete copy of the Certificate of Incorporation of the Authority, together with the Articles of
Incorporation of the Authority, which were filed with the Secretary of State of Texas on July 14,
2004, and a complete copy of the Bylaws of the Authority. The Authority's Articles of
Incorporation and Bylaws have not been amended, repealed, changed, or altered since the Authority
was created.
5.Attached hereto as Exhibit C is a true, correct, and complete copy of a Certificate of
Continued Fact from the Secretary of State of Texas. Attached hereto as Exhibit D is a true, correct,
and complete copy of a Certificate of Good Standing from the Comptroller of Public Accounts of
the State of Texas.
6.On April 30, 2012, the Board of Directors of the Authority consisted of the
following persons:
Torn Reid Chair
Bill Sloan Vice-Chair
Ed Baker Secretary
Torn Pool Director
Anthony D. Carbone Director
I-IOU:3213719.3
7.No litigation is pending or, to the best of our knowledge, threatened against the
Authority with respect to the issuance of the Bonds, or the title or authority of the officers and
directors of the Authority.
8.Due notice of all meetings relating to the sale, issuance, and delivery of the Bonds
has been given to the directors of the Authority in accordance with the Authority's Bylaws and State
law.
9.Attached hereto as Exhibit E is a true and correct copy of the combined debt service
schedule for the Bonds.
10.The resolution authorizing the issuance of the Bonds and other documents relating to
the issuance of the Bonds (the "Bond Documents") (a) have been properly executed by the
Authority and due performance thereof has been authorized by the Authority, (b) are in substantially
the form as approved by or on behalf of the Authority and (c) are in full force and effect and have
not been amended or rescinded except as may have been approved by the Chairman of the
Authority with the advice of Bond Counsel.
11.The Authority has taken no action that, if finally concluded, would constitute a
breach or violation of any of the covenants and provisions of the Bond Documents.
12.The terms and performance of the Bond Documents by the Authority are not in
conflict with the Articles of Incorporation or Bylaws of the Authority or any other instrument or
restriction to which the Authority is a part or subject.
13.The Authority has determined that the Project will promote and develop new and
expanded business enterprises that create or retain "primary jobs," as such term is defined in Section
501.002(12) of the Texas Local Government Code, as amended.
14.For any twelve (12) consecutive months of the preceding 18-month period
immediately preceding the month in which the Resolution authorizing the Bonds was adopted
(the "Base Period"), the Pledged Revenues were equal to at least 1.25% of the average annual
principal and interest requirements on all Parity Bonds that will be Outstanding after the issuance
of the Bonds.
15.Attached as Exhibit F is a schedule showing a history of Pledged Revenue
collections for the past three years.
16.The new money portion of the Bonds is being used for developer reimbursement
for Infrastructure Improvements for Village 3, Phase 1 & 2 Improvements.
[Signature page follows.].
2
I-IOU:3213719.3
WITNESS OUR HANDS this of April, 2012.
DEVELOPMENT AUTHORITY OF PEARLAND
Chair
vi I
Secretary
S-1
HOU:3213719.1
EXHIBIT A
Articles of Incorporation
HOU:3213719.1
Corporations sec6o Geoffrey S. Connor.
P.O.$ox 13697 CAD
Secretary of State
Austin, Texas 7$711-3697 `L'
Office .of the Secretary . of State
CERTIFICATE OF INCORPORATION •
• OF
DEVELOPMENT AUTHORITY OF PEARLAND
• Filing Number: 800364974
The undersigned, as Secretary of State of Texas, hereby certifies that Articles of Incorporation for the
•above named corporation have been received in this office and have been found to conform to law.
Accordingly, the undersigned, as Secretary .'of State, and by virtue of the authority vested in the Secretatj ►
•by law, hereby issues this Certificate of Incorporation.
Issuance of this Certificate of Incorporation does not authorize the use of a name in this state in violation
of the'rigbts of another under the federal Trademark Act of 1946, the Texas tradernarc law, the Assumed
• Business orProfessional Name Act, or the common law.
Dated: 07/14/2004
Effective: 07/14/2004
^ ^r
\\ `! ter,
Geoffrey S. Connor
Secretary of State
Corne•visit us on the interact at http ://www.sos.state .t%.ns/
PHONE(512) 463-5555 . • • FAX(512) 463-5709 • T1Y7-1-1
Prep wd by: Rosa Anellano •
Corporations Section art E a ' • ueoirrey -.b'. t;onnor
P-OJ3ox 13697 Secretary of State
Austin; Texas 78711-3697
..Office of the Secretary of State
July 14,201J4
Attu: KRISTA
Capitol. Services Inc .
P O Box 1831
Austin, TX 78767 USA
RE: DEVELOPMENT AUTHORITY OF PEARLAND
File Number:. 800364974
It has been our pleasure to file the articles of incorporation and issue the enclosed •certificate of
incorporation evidencing the existence of the newly created corporation.
Corporations organized under the Texas Non-Profit Corporation Act • do not, automatically qualify for
an exemption from federal and state taxes. . Shortly, 'the Comptroller of Public Accounts will be
contacting the. corporation at its registered office for information that will assist the Comptroller in
setting up the franchise tax account for the corporation. If you need to contact the Comptroller about
franchise .taxes or exemption therefrom, you may contact the agency by calling (800) 252-1381, by e-
mail to tax.help .ctia.state.tx.us 'oi by.writing P. O. Box 13528, Austin, TX 78711-3528: Telephone
questions regarding' other business taxes,• including sales •taxes, should be directed to, (800) .252-5555.
Information on exemption from federal taxes is available from the Internal Revenue Service.
Non-profit corporations do not file annual reports with the Secretary of State, but do file a report not
more often than once every four years as requested by the Secretary. It is important for the corporation
to continuously maintain a registered agent and office in Texas as this is the address to which the
Secretary of State will send a request to file a periodic report. Failure to maintain' a registered agent or
office in Texas, failure to file a change to the agent or. office information ,: or failure, to file a report
when requested may result in involuntary dissolution -of the corporation. Additionally, .a non-profit
corporation will file documents with the Secretary of State if the . corporation needs to amend one of tha
provisions in its articles of incorporation.
If we can be of further service at any time, please let us know. • '
Sincerely,
Corporations Section
Statutory Filings Division
(512) 463-5555
Enclosure
come visit us on the intemet at bttpJ/www.sos.state.tx.ust
PHOt^`E(512) 463-55=5 FAX(512) 463-5709 5 m7-i-1
FILED
ARTICLES OF INCORPORATION . In the Office.of the
Secretary of •State of Texas
OF'
JUL 14 290k ...
DEVELOPMENT AUTHORITY OF PEARLAND.
Corporations Section
• We, the undersigned natural persons, each of whore is at least eighteen (18) years of age
or more and a qualified voter of the City of Pearland, Texas'(the "City") 'and 'a citizen of the State
of Texas, acting as incorporators of a corporation under the provisions ,of Subchapter D of
Chapter 431, Texas Tiansportation Code (the "Act'), and Chapter 394, Texas Local Government
• Code (the "Local Government • Code'), do hereby adopt the following Articles of Incorporation
for such corporation:
ARTICLE I
The name of the corporation . is' DEVELOPMENT AIJTBORITY OF PEARLAND (the
"Autthbrity").
- ARTICLE 71
The Authority is a public non-profit corporation.
ARTICLE III •
'The period of duration of the Authority shall be perpetual'. .
• ARTICLE IV '
The Authority is organized for the purpose of aiding, assisting, and acting on behalf of
the City in the performance of its governmental functions to promote the common good and
general welfare and, particularly, to promote,. develop, encourage and maintain, housing,
educational Tacilities, employment, commerce, industrial and economic development in the City.
The' Authority is further organized to aid, assist and act on behalf of the City:
• (a) in the development' of a policy to finance development and redevelopient of
residential, educational facilities, commercial, industrial, and park/open space ' properties in the
City; and
(b) in the development and implementation of development and redevelopment
policies' for the City, including the acquisition of land for development and redevelopment
purposes.
The Authority is formed pursuant to and shall have all corporate powers provided by the
provisions of the Act as it now or may hereafter be amended, and Chapter 394, Texas Local
Government Code, which authorizes the Authority to assist and act on behalf of the City and to
engage in activities in the furtherance of the puiposes for its creation.
rtou .2-M-17
0
an
The Authority shall have turd exercise all of the rights, powers, privileges, authority, and
functions given by the general laws 'of Texas to non-profit corporations incorporated Under the
Act including, without limitation, Article 1396, \r ernon's Texas Civil. Statutes.
The Authority .shall have all other powers of a like or different nature not' prohibited by
law which are available to non-profit'cotporations in Texas and which are necessary or useful to
enable the Authority to perform the purposes for.which it is created, including the power to issue
bonds, notes-or other obligations, and otherwise exercise its borrowing power to. accomplish the
purposes for which it was' created, provided that the Authority shall not issue bonds without the,
consent-of the City Council of the City.
The Authority is created as a local .government corporation pursuant to the Act and shall
be a governmental unit, within the meaning of Subdivision (2), Section 101 .0O1,. Texas Civil
• Practice and' Remedies Code. . The operations of the Authority are governmental and not
proprietary functions for purposes of the Texas Tori Claims Act, Section 101.001 et seq.,.Texas
• Civil Practice and. -Remedies Code. The Authority shall have the power to` acquire laud in
accordance with the Act as amended from time to time. .
ARTICLE V . .. S
The Authority shall have no members and shall have no stock. ' ..
ARTICLE VI . .
Al) powers of the Authority shall be •vested in .a Board consisting of five(5)persons. The..
4i initial directors of the Authority' ("Director" or "Directors') shall'be those persons named in
Article Vlll. Persons ser ving as Directors' to the Authority may simultaneously be members of
the City'Couricil .of the City, provided, however that at no time shall more.thantwo Directors of
the Board . also be members of the City Council of the City. Each initial Director and all.
subsequent Directors shall be residents of the City. Each initial Director named in Article VIII
hereof shall serve for the term prescribed in the Bylaws.. Subsequent Directors shall be
appointed by position to the Board by the City Council of the City as prescribed in the Bylaws..
Except. as provided in the Articles of Incorporation,' each Director shall serve for the tent
provided in the Bylaws. Any Director may be removed from office at any time, with :or without
cause, by the City Council of the City.
The initial Chair, shall be Toni Reid. Mayor , and the City Council of the City shall
designate each subsequent Chair of the Board. .
If any of the following persons is- not serving as a member of the Board, he or she or their
designee shall serve as an ex-officio, non-voting member. of the Board:
(1)-City Manager;
(2)' Ci'ry :Attorney; and
(3)', Deputy City Manager.
)40U•2?R9-37.4
In addition, the Board of Directors of the Authority may designate one or more -representatives of
the, Alvin Independent School District; Pearland Independent School. District, Harris County!'
Brazoria County, Fort Bend County or other political subdivisions as ex officio, non-voting
T members of the Board of Directors 'Ex-officio .members of the Board are non-voting members
and are not required to be residents of the City.
All other matters pertaining to the internal affairs of the Authority shall be governed by
the Bylaws of the Authority, so long as such Bylaws are not inconsistent with •these Articles. of
4% incorporation, or the laws of the State of Texas.
'k ARTICLE VII
The street address of the initial registered office of the Authority is 3519 Liberty Drive,
Pearland, Texas ' 77581, and the name of its initial registered agent at such address is . Damn
Coker, Cit y Attorney, 3519 Liberty Drive, Pearland, Texas 77581.
ARTICLE Viii
The number of Directors initially._ constituting the Board is ' five (5). The names,'
addresses; and positions of the live (5) initial, Directors, each of whom resides within the City are
as follows:
Name and. Address
Tom Pool ,. Position One • .
2120 Country Club Drive
• Pearland, Texas 77581
Bill Sloan Position Two
1935• Timbcrcreek .
Pearland, Texas 77581
• Henry Stanaland Position Three
5108 Carmona
Pearland, Texas 77584
• Ed Baker 'Position Four
2405 Londonderrvv Drive
• Pearland, Texas 77581 .
Tom Reid Position Five
• 2716 Stratford
Pearland, Texas 77581
ARTICLE IX
The names and street addresses_ of the incorporators, each of whom resides within the
City are as follows: .
3.
UOU:22542:• s
Name and Address
Bill Eisen
3519 Liberty Drive
Pearland, Texas,.77581 .
Alan Mueller
3519 Liberty Drive
Pearland, Texas, 77581
FredWelch .
• 3519.Ia'berty Drive
Pearland, Texas, 77581
-ARTICLE X
•
Resolution No. 2004-107 approving the form of these Articles oflncorporatioA has been.
adopted by the City Council of the City on June .28, 2004.'
ARTICLE XI
No Director. shall be liable to the. Authority for monetary damages for an act or omission
in the director's capacity as a Director, except for liability (i) for, any breach of the Director's
ditty of loyalty to the Authority, (ii) for acts or omissions not in good faith or which involve
• intentional misconduct or a knowing violation of law, (iii) for any transaction from which the
Director received an improper benefit, whether or not the benefit resulted from an act taken
within the scope of the Director's office, or (iv) for acts or omissions for which the liability of a
Director is expressly provided by statute. • Any .repeal or amendment . of this Article by, the
Directors shall be prospective only,, and shall not adversely affect any limitation onthe personal
liabilit y of -a Director existing -at the time of, such repeal or amendment. In addition to the
circumstances in which a Director is not- personally: liable as set forth in the preceding sentences,
a .Director shell not be .liable to the fullest -exierit permitted by any amendment to the Texas
• statutes hereafter enacted that further limits the liability of a Director.
ARTICLE XII
In accordance with the provisions of Section 50l (c)(3) of the U.S; Interval Revenue Code
of 1986, as amended (the "Code'), and regardless of any other provisions of these Articles of
Incorporation or the laws of the. State of Texas, the Authority; (a) shalt not permit any part of the
• net tannings of the Authority to inure to the benefit of any private individualexc t that
reasonable compensation may be paid for personal services rendered to or for the Authority in
effecting one or more of itspurposes); shall not.devote more than an insubstantial ti b (b) part of its
activities- to attempting to influence legislation by propaganda or otherwise; (c) shall not
participate in, or intervene in (including . the publication or distribution of statements), any
political campaign on behalf of any candidate for public office; and (d) shall not attempt to
influence the outcome.of any eleciion for public office or to . carry on directly or indirectly, any
voten registration drives. Any income earned by the Authority after payment of reasonable
expcnses. debt and establishing a reserve shall accrue to the City.
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110U ,' X5923 .4
The City shall, at.. all times, have an unrestricted-right to receive any income earned by the
Authority, exclusive of ' amounts needed to cover •reasonable expenditures and reasonable
reserves for future activities.. Unless otherwise directed by the City; -any income of the Authority
.received by the City shall be deposited into the City's General Fund,. or a 'successor fund. No
pact of the Authority's income shall inure to, the benefit of any private:interests :• -
If the Board of Directors dedermiines . by resolution► that the purposes for which the
Authority was. formed have been substantially met and all bonds_ issued by and all obligations
incurred by the Authority have - been fully paid, the Board. shall. execute ' a certificate of
dissolution which states those facts and declares the Authority'.dissolved .in accordance with the
requirements of Section 394.026 of Texas Local'Governmerit`Code,,or.with applicable law-ihen'
in existence. In the event of dissolution or liquidation qi the Authority, all assets, will be turned
• over to the Finance Department of the City, or its successor, for deposit into the.City's General
Fund unless the City Council of the City shall otherwise direct.
Any capital project(s) of the Authority as we as , all plans and specifications of any
• improvements to be made by the Authority shall be approved in writing by the City Engineer.
ARTICLE alll
If the Authority is a private foundation within the meaning of Section 509(a) of the Code,
the Authority. (a) shall distribute its income for each taxable year at such time and • in such
manner as not to become subject to the tax on undistributed income imposed by Section 4942 of
the Code; (b) shall not engage-in any act . of self-deaiing as defined in Section 4941(d) of the
Code; (c) shall not retain any excess'business holdings as defined in Section 4943(c) of the Code;'
(d) shall not make any investments in such manner as to . subject it to talc: under Section 4944 of
the Code; and (e) shall not make •any taxable expenditures as defined in Section 4945(d) of the
Code.
ARTICLE XIV
The City Council of the City may at • any time consider and approve an ordinance
directing the Board to proceed with the dissolution of the Authority, at which time the Board
4 ': shall proceed with the dissolution of the Authority in accordance with applicable slate law: The
failure of the Board to .proceed with the dissolution of the Authority in accordance with this
Article shall be deemed a cause - for the removal from office of any or all of the Directors as
permitted by Article V1 of those Articles of Incorporation.
ARTICLE XN
These Articles m iv not be changed or amended unless approved by the Cit y Council of
the Cit y. .
5
IN WITNESS WHEREOI=, we have hereunto set our hands this :j._ day bf p
2004.
Bill Eisen, Incorporator ASL
Alan 4ueller, Incorporator
EXHIBIT B
Amended Bylaws
HOU:3213719.1
BYLAWS
OF
DEVELOPMENT AUTHORITY
OF PEARLAND
A Texas Local Government Corporation
(Created by the City of Pearland, Texas)
Date of Adoption: July 27, 2004
TABLE OF CONTENTS
P age
ARTICLEI. PURPOSES ...............................................................................................................1
ARTICLEII. BOARD OF DIRECTORS .......................................................................................1
Section 1.Appointment, Classes, Powers, Number, and Term of Office ...............................1
Section 2.Meetings of Directors .............................................................................................2
Section3.Annual Meetings ....................................................................................................2
Section4.Regular Meetings ...................................................................................................2
Section 5.Special and Emergency Meetings ..........................................................................2
Section6.Quorum ...................................................................................................................3
Section 7.Conduct of Business ...............................................................................................3
Section8.Committees ...........................................................................................:.................3
Section 9.Compensation of Directors .....................................................................................4
Section 10.Director's Reliance on Consultant Information ......................................................4
ARTICLEIII.OFFICERS ..............................................................................................................4
Section 1.Titles and Term of Office .......................................................................................4
Section 2.Powers and Duties of the Chair ..............................................................................4
Section 3.Powers and Duties of the Vice-Chair .....................................................................4
Section 4.Execution of Documents ........................................................................................5
Section5.Treasurer ..................................................................................................................5
Section6.Secretary .................................................................................................................5
Section7.Compensation ..........................................................................................................5
Section 8.Officer's Reliance on Consultant Information ........................................................5
ARTICLE IV.INDEMNIFICATION OF DIRECTORS AND OFFICERS ..................................6
Section 1.Right to Indemnification ........................................................................................6
Section2.Advance Payment ...................................................................................................6
Section 3.Indemnification of Employees and Agents ............................................................6
Section 4.Appearance as a Witness ........................................................................................7
Section 5.Non-exclusivity of Rights ..........................................................................._..........7
Section6. 'Insurance ................................................................................................................7
Section7.Notification .......................................... ................................................................7
Section8.Savings Clause .......................................................................................................7
ARTICLE V.AMENDMENTS TO BYLAWS .............................................................................8
ARTICLE VI.MISCELLANEOUS PROVISIONS .......................................................................8
Section1.Fiscal Year ...............................................................................................................8
Section2.Seal .........................................................................................................................8
Section 3.. Notice and Waiver of Notice ..................................................................................8
Section4.Resignations ...........................................................................................................8
Section5.Gender ....................................................................................................... ......8
Section 6.Appropriations and Grants .....................................................................................8
Section 7 Legal Authorities Governing Construction of Bylaws ...........................................8
Section8 Heading ..................................................................................................................9
Section 9 Parties Bound .............................................................................. .....9 ......................
Section10 Effective Date .........................................................................................................9
BYLAWS
OF THE
DEVELOPMENT AUTHORITY
OF PEARLAND
ARTICLE I.
PURPOSES
Development Authority of Pearland (the "Authority") is organized for the purpose of
aiding, assisting, and acting on behalf of the City of Pearland, Texas (the "City") in the
performance of their governmental functions to promote the common good and general welfare
of the City to promote the economic development and diversification of the City, to develop,
encourage and maintain employment, and to develop and expand commerce in the City.
The Authority is formed pursuant to the provisions of Chapter 431, Texas Transportation
Code, as amended ("the Act") as it now or may hereafter be amended, and Chapter 394, Local
Government Code, which authorizes the Authority to assist and act on behalf of the City and to
engage in activities in the furtherance of the purposes for its creation.
The Authority shall have and exercise all of the rights, powers, privileges, authority, and
functions given by the general laws of Texas to non-profit corporations incorporated under the
Act including, without limitation, Article 1396, Vernon's Texas Civil Statutes, as , amended.
The Authority shall have all other.powers of a like or different nature not prohibited by
law which are available to non-profit corporations in Texas and which are necessary or useful to
enable the Authority to perform the purposes for which it is created, including the power to issue
bonds, notes or other obligations, and otherwise exercise its borrowing power to accomplish the
purposes for which it was created, provided that the Authority shall not issue bonds without the
consent of the City Council of the City.
The Authority is created as a local government corporation pursuant to the Act and shall
be a governmental unit within the meaning of Subdivision (2), Section 101.001, Civil Practice
and Remedies Code. The operations of the Authority are governmental and not proprietary
functions for purposes of the Texas Tort Claims Act, Section 101.001 et seq., Civil Practice and
Remedies Code. The Authority shall have the power to acquire land in accordance with the Act
as amended from time to time.
ARTICLE II.
'BOARD OF DIRECTORS
Section I. Appointment, Classes, Powers, Number, and Term of Office. All powers of
the Authority shall be vested in the Board of Directors (the "Board of Directors"). The Board of
Directors shall initially consist of five (5) persons.. At no time shall more than two (2) Directors
also be members of the City Council of the City. The City Council shall appoint all of the
Directors.
Each Director shall serve for a term which expires on the date set forth below for the
position to which such person was appointed, or until his or her successor is appointed by the
City. unless such Director has been appointed to fill an unexpired term in which case the term of
the Director shall expire on the expiration date of the term of the Director whose position he or
she was appointed to fill or until his or her successor is appointed and qualifies for the position.
Any Director may be removed from office at any time, with or without cause, by the City
Council. The number. of Directors may only be increased or decreased by consent of the City
Council of the City.
The terms of office for the Directors shall be staggered. Positions 1, 3 and 5 shall expire
on September 30 of the next odd year following the initial appointment of Directors for such
positions. Positions 2 and 4 shall expire on September 30 of the next even year following the
initial appointment of Directors to such positions. The Directors' term of office for all positions
following initial appointment shall be two years ending September 30 of the odd or even year
indicated in this paragraph. All Directors shall hold their respective offices until their successor-
is appointed and qualifies as a Director. The City Manager, Deputy City Manager and City
Attorney shall serve as ex efficio members of the Board of Directors and shall not be entitled to
vote.
Section 2. Meetings of Directors. The Directors may hold their meetings and may have
an office and keep the books of the Authority at City Hall or such other location in the City as
the Board of Directors may from time to time determine; provided, however, in the absence of
any such determination, such place shall be the registered office of the Authority in the State of
Texas.
To the extent provided by law, the meetings of the Board of Directors and any committee
of the Board of Directors shall be held in accordance with and notice of such meetings shall be
filed for the same length of time and in the same manner and location as is required of a City
under Chapter 551, Government Code, as amended (the "Open Meetings Act").
To the extent provided by law, the Authority, the Board of Directors, and any committee
of the Board of Directors exercising the powers of the Authority are subject to Chapter 552,
Government Code, as amended (the "Public Information Act").
Section 3. Annual Meetings. The annual meeting of the Board of Directors shall be held
at the time and at the location in the City designated by the resolution of the Board of Directors
for the purposes of transacting such business as may be brought before the meeting.
Section 4. Regular Meetings. Regular meetings of the Board of Directors shall be held
at such times and places as shall be designated, from time to time, by resolution of the Board of
Directors.
Section 5. Special and Emergency Meetings. Special and emergency meetings of the
Board of Directors shall be held whenever called by the Chair of the Board of Directors or the
Secretary or by a majority of the Directors who are serving duly appointed terms of office at the
time the meeting is called.
The Secretary shall give notice of each special meeting in person, by telephone,
facsimile, e-mail, mail or telegraph at least three (3) days before the meeting to each Director and
to the public in compliance with the Open Meetings Act. Notice of each emergency meeting
shall also be given in the manner required of the City under Section 551.045 of the Open
Meetings Act. - Unless otherwise indicated in the notice thereof, any and all matters pertaining to
the purposes of the Authority may be considered and acted upon at a special or emergency
meeting. At any meeting at which every Director shall be present, even though without any
notice, any matter pertaining to the purposes of the Authority may be considered and acted upon
to the extent allowed by the Open Meetings Act.
Section 6. Quorum. A majority of the Board of Directors shall constitute a quorum for
the consideration of matters pertaining to the purposes of the Authority. If at any meeting of the
Board of Directors there is less than a quorum present, a majority of those present may adjourn
the meeting from time to time. The act of a majority of the Directors present and voting at a
meeting at which a quorum is in attendance shall constitute the act of the Board of Directors,
unless the act of a greater number is required by law, by the Articles of Incorporation, or by these
Bylaws.
A Director who is present at a meeting. of the Board of Directors at which any corporate
action is taken shall be presumed to have assented to such action unless his dissent or abstention
shall be entered in the minutes of the meeting or unless he shall file his written dissent or
abstention to such action with the person acting as the secretary of the meeting before the
adjournment thereof or shall forward such dissent or abstention by registered mail to the
Secretary of the Board of Directors immediately after the adjournment of the meeting. Such
right to dissent shall not apply to a Director who voted in favor of the. action.
Section 7. Conduct of Business. At the meetings of the Board of Directors, matters
pertaining to the purposes of the Authority shall be considered in such order as from time to time
the Board of Directors may determine.
At all meetings of the Board of Directors, the Chair shall preside, and in the absence of
the Chair, the Vice-Chair shall preside. In the absence of the Chair and the Vice-Chair, a chair
shall be chosen by the Board of Directors from among the Directors present.
The Secretary of the Board of Directors shall act as secretary of all meetings of the Board
of Directors, but in the absence of the Secretary, the presiding officer may appoint, any person to
act as secretary of the meeting.
Section 8. Committees. The Board of Directors may, by resolution passed by a majority
of the Directors, designate two (2) or more Directors to constitute. one or more committees. A
committee shall act in the manner provided in the authorizing resolution. Each committee so
designated shall keep regular minutes of the transactions of its meetings and shall cause such
minutes to be recorded in books kept for that purpose in the office of the Authority, and shall
report the same to the Board of Directors from time to time.
M
Section 9. Compensation of Directors. Directors, as such, shall not receive any salary
or compensation for their services as Directors; unless otherwise directed by the City Council. A
Director may be reimbursed for reasonable out-of-pocket expenses incurred as a Director in
accordance with guidelines established by the Board of Directors which are reasonable and
necessary in carrying out the Board of Directors' purposes.
Section 10. Director's Reliance on Consultant Information. A Director shall not be
liable if while acting in good faith and with ordinary care, he relies on information, opinions,
reports, or statements, including financial statements and other financial data that were prepared
or presented by:
(a)one or more other officers or employees of the Authority;
(b)legal counsel, public accountants, or other persons as to matters the officer
reasonably believes are within the person's professional or expert competence; or
(c)a committee of the Board of Directors of which the Director is not a member.
ARTICLE III.
OFFICERS
Section 1. Titles and Term of Office. The officers of the Authority shall be a chair of
the Board of Directors, one or more vice chairs of the Board of Directors, a secretary, a treasurer,
and such other officers as the Board of Directors may from time to time shall elect. One person
may hold more than one office, except that the Chair of the Board may not hold the office of
Secretary. The term of office for each officer (other than the Treasurer) shall be coincident with
the Director's term of office.
All officers (other than the Treasurer) shall be subject to removal, with or without cause,
at any time by a vote of a majority of the whole Board of Directors.
A vacancy in the office of any officer (other than the Treasurer) shall be filled by the
Board of Directors. The designation of the Treasurer shall be governed by the provisions of
Section 5 of this Article.
Section 2. Powers and Duties of the Chair. The Chair shall be a member of the Board
of Directors and shall preside at all meetings of the Board of Directors. He or she shall have
such duties as are assigned by the Board of Directors. The Chair may call special or emergency
meetings of the Board of Directors.
Section 3. Powers and Duties of the Vice-Chair. The Vice-Chair shall be a member of
the Board of Directors and shall perform the duties and exercise the powers of the, Chair upon the
Chair's death, absence, disability, or resignation, or upon the Chair's inability to perform the
duties of his or her office. Any action taken by the Vice-Chair in the performance of the duties
of the Chair shall be conclusive evidence of the absence or inability to act of the Chair . at the
time such action was taken.
Section 4. Execution of Documents. In furtherance of the purposes of the Board of
Directors and subject to the provisions of the Articles of Incorporation and By-laws, the Board of
Directors may authorize the Chair or Vice Chair to sign and execute all bonds, notes, deeds,
conveyances, franchises, assignments, mortgages, notes, contracts and other obligations in the
name of the Authority.
Section 5. Treasurer. Notwithstanding the provisions of any other Section of this
Article, the City of Pearland Director of Finance shall be the Treasurer of the Authority. The
Treasurer shall have custody of all the funds and securities of the Authority which come into his
or her hands. When necessary or proper, he or she may endorse, on behalf of the Authority, for
collection, checks, notes and other obligations and shall deposit the same to the credit of the
Authority in a special Authority fund in the City's depository bank or banks. He or she may sign
all receipts and vouchers for payments made to the Authority, either alone or jointly with such
other officer as is designated by the Board of Directors. Whenever requested by the Board of
Directors, he or she shall perform all acts incident to the position of Treasurer subject to the
control of the Board of Directors and he or she shall, if required by the Board of Directors, give
such bond for the faithful discharge of his or her duties in such form as the. Board of Directors
may require. All Authority funds shall be secured in the same manner as City funds, as required
by Chapter 2256, Government Code, the Public Funds Investment Act.
Section 6. Secretary. The Secretary shall keep the minutes of all meetings of the Board-
of Directors in books provided for that purpose. He or she shall attend to the giving and
serving of all notices; in furtherance of the purposes of the Authority and subject to the
limitations contained in the Articles of Incorporation, he or she may sign with the Chair in the
name of the Authority and/or attest the signatures thereof, all contracts, conveyances,
franchises, bonds, deeds, assignments, mortgages, notes and other instruments of the
Authority. He or she shall have charge of the Authority's books and records, except the books
of account and financial records and securities of which the Treasurer shall have custody and
charge, and such other books and papers as the Board of Directors may direct, and, he or she
shall in general perform all duties incident to the office of Secretary subject to the control of
the Board of Directors
Section 7. Compensation. Officers may not receive salary or compensation for
personal services. Members of the Board of Directors, even in their capacity as officers, are
not entitled to compensation
Section 8. Officer's Reliance on Consultant Information. In the discharge of a duty
imposed or power conferred on an officer of the Authority, the officer may in good faith and
with ordinary care rely on information, opinions, reports, or statements, including financial
statements and other financial data that were prepared or presented by
(a)one or more other officers or employees of the Authority, including members of
the Board of Directors; or
(b)legal counsel, public accountants, or other persons as to matters the officer
reasonably believes are within the person's professional or expert competence.
ARTICLE IV.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1. Right to Indemnification. Subject to the limitations and conditions as
provided in this Article IV and the Authority's Articles of Incorporation, each person who
was or is made a party or is threatened to be made a party to or is involved in any
threatened, pending or completed action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative (hereinafter a "Proceeding"), or any appeal in
such a proceeding or any inquiry or investigation that could lead to such a proceeding., by
reason of the fact that he or she, or a person of whom he or she is the legal representative,
is or was a director or officer of the Authority or while a director or officer of the
Authority, is or was serving at the request of the Authority as a director, officer, partner,
venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or
domestic corporation, partnership, joint venture, sole proprietorship, trust, employee
benefit plan or other enterprise, shall be indemnified by the Authority to the fullest extent
permitted by the Texas Non-Profit Corporation Act, as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such amendment
permits the Authority to provide broader indemnification rights than said law permitted
the Authority to provide prior to such amendment) against judgments, penalties (including
excise and similar taxes and punitive damages), fines, settlements and reasonable expenses
(including, without limitation, attorneys' fees) actually incurred by such person in
connection with such proceeding, and indemnification under this Article IV shall continue
as to a person who has ceased to serve in the capacity which initially entitled such person to
indemnity hereunder. The rights granted pursuant to this Article IV shall be deemed
contract rights, and no amendment, modification or repeal of this Article IV shall have the
effect of limiting or denying any such rights with respect to actions taken or proceedings
arising prior to any such amendment, modification or repeal. It is expressly acknowledged
that the indemnification provided in this Article IV could involve indemnification for
negligence or under theories of strict liability.
Section 2. Advance Payment. The right to indemnification conferred in this Article IV
shall include the right to be paid in advance or reimbursed by the Authority the reasonable
expenses incurred by a person of the type entitled to be indemnified under Section 1 who was, is
or is threatened to be made a named defendant or respondent in a proceeding in advance of the
final disposition of the proceeding and without any determination as to the person's ultimate
entitlement to indemnification; provided, however, that the payment of such expenses incurred
by any such person in advance of the final disposition of a proceeding, shall be made only upon
delivery to the Board of Directors of a written affirmation by such Director or officer of his or
her good faith belief that he or she has met the standard of conduct necessary for indemnification
under this Article IV and a written undertaking, by or on behalf of such person, to repay all
amounts so advanced if it shall ultimately be determined that such indemnified person is not
entitled to be indemnified under this Article IV or otherwise.
Section 3. Indemnification of Employees and Agents. The Authority, by adoption of a
resolution of the Board of Directors, may indemnify and advance expenses to an employee or
agent of the Authority to the same extent and subject to the same conditions under which it may
4
indemnify and advance expenses to Directors, and officers under this Article IV; and the
Authority may indemnify and advance expenses to persons who are not or were not Directors.
officers, employees or agents of the Authority but who are or were serving at the request of the
Authority as a Director, officer, partner, venturer, proprietor, trustee, employee, agent or similar
functionary of another foreign or domestic corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan or other enterprise against-any liability asserted
against him or her and incurred by him or her in such a capacity or arising out of his or her status
as such a person to the same extent that it may indemnify and advance expenses to Directors
under this Article IV.
Section 4. Appearance as a Witness. Notwithstanding any other provision of this
Article IV, the Authority may pay or reimburse expenses incurred by a Director or officer in
connection with his or her appearance as a witness or other participation in a proceeding
involving the Authority or its business at a time when he or she is not a named defendant or
respondent in the proceeding.
Section 5. Non-exclusivity of Rights. The right to indemnification and the advancement
and payment of expenses conferred in this Article IV shall not be exclusive of any other right
which a Director or officer or other person indemnified pursuant to Section 3 of this Article IV
may have or hereafter acquire under any law (common or statutory), provision of the Articles of
Incorporation of the Authority or these Bylaws, agreement, vote of shareholders or disinterested.
Directors or otherwise.
Section 6. Insurance. The Authority may purchase and maintain insurance, at its
expense, to protect itself and any person who is or was serving as a Director, officer, employee
or agent of the Authority or is or was serving at the request of the Authority as a Director,,
officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another
foreign or domestic corporation, partnership, joint venture, proprietorship, employee benefit
plan, trust or other enterprise against any expense, liability or loss, whether or not the Authority
would have the power to indemnify such person against such expense, liability or loss under this
Article IV.
Section 7. Notification. Any indemnification of or advance of expenses to a Director or
officer in accordance with this Article IV shall be reported in writing to the members of the
Board of Directors with or before the notice of the next regular meeting of the Board of Directors
and, in any case, within the 12-month period immediately • following the date of the
indemnification or advance.
Section 8. Savings Clause. If this Article IV or any portion hereof shall be invalidated
on any ground by any court of competent jurisdiction, then the Authority shall nevertheless
indemnify and hold harmless each Director, officer or any other person indemnified pursuant to
this Article IV as to costs, charges and expenses (including attorneys fees), judgments, fines and
amounts paid in settlement with respect to any action, suit or proceeding, whether civil, criminal,
administrative or investigative, to the full .extent permitted by any applicable portion of this
Article IV that shall not have been invalidated and to the fullest extent permitted by applicable
law.
'1
ARTICLE V.
AMENDMENTS TO BYLAWS
.A proposal to alter, amend, or repeal these Bylaws shall be made by the affirmative vote
of a majority of the full Board of Directors at any annual or regular meeting, or at any special
meeting if notice of the proposed amendment be contained in the notice of said special meeting.
However, any proposed change or amendment to the Bylaws must be approved by the City
Council of the City to be effective.
ARTICLE VI.
MISCELLANEOUS PROVISIONS
Section 1. Fiscal Year.. The fiscal year of the Authority shall run concurrently with the-
fiscal year of the City.
Section 2. Seal. The seal of the Authority shall be such as from time to time may be
approved by the Board of Directors.
Section 3. Notice and Waiver of Notice. Whenever any notice whatever, other than
public notice of a meeting given to comply with the Open Meetings Act, is required to be given
under the provisions of these Bylaws, such notice shall be deemed to be sufficient if given by
depositing the same in -a post office box in a sealed postpaid wrapper addressed to the person
entitled thereto at his or her post office address, as it appears on the books of the Authority, and
such notice shall be deemed to have been given on the day of such mailing. A waiver of notice,
signed by the person or persons entitled to said notice, whether before or after the time stated
therein, shall be deemed equivalent thereto.
Section 4. Resignations. Any Director or officer may resign at any time. Such
resignations shall be made in writing and shall take effect at the time specified therein, or, if no
time be specified,, at the time of its receipt by. the Chair or Secretary. The acceptance of a
resignation shall not 'be necessary to make it effective, unless expressly so provided in the
resignation.
Section S. Gender. References herein to the masculine gender shall also refer to the
feminine in all appropriate cases and vice versa.
Section 6. Appropriations and Grants. The Authority shall have the power to request
and accept any appropriation, grant, contribution, donation, or other form of aid from the federal
government, the State, any political subdivision, or municipality in the State, or from any other
source.
Section 7. Legal Authorities Governing Construction of Bylaws. The Bylaws shall be
construed in accordance, with the laws of the State of Texas. All references in the Bylaws to
statutes, regulations, or other sources of legal authority shall refer to the authorities cited, or their
successors, as they may be amended .from time to time.
Section 8. Heading The headings used in the Bylaws are used for convenience and
shall not be considered in construing the terms of the Bylaws.
Section 9. Parties Bound. The Bylaws shall be binding upon and inure to the benefit of
the directors, offices and agents of the Authority and their respective heirs, executors,
administrators, legal representatives, successors and assigns except as otherwise provided in the
Bylaws.
Section 10. Effective Date. These Bylaws, and any subsequent amendments thereto,
shall be effective of and from the date upon which approval has been given both by the Board of
Directors and the City Council of the City.
0
CERTIFICATE OF SECRETARY
I certify that I am the duly elected and acting secretary of the DEVELOPMENT
AUTHORITY OF PEARLAND, and the foregoing Bylaws constitute the Bylaws of the
Authority. These Bylaws were approved by the City Council of the City of Pearland,
Texas, at a meeting held on June 28, 2004, and adopted at a meeting of the Board of
Directors of the Authority held on July 27, 2004:
Signed this November 15, 2004.
SECR TARY, DEVELOPMENT AUTHORITY
OF PEARLAND
EXHIBIT C
Certificate of Fact
HOU:3213719.1
Corporations Section TE of Hope Andrade
P.O.Box 13697 G, f Secretary of State
Austin, Texas 78711-3697 x
Office of the Secretary of State
Certificate of Fact
The undersigned, as Secretary of State of Texas, does hereby certify that the document, Articles of
Incorporation for DEVELOPMENT AUTHORITY OF PEARLAND (file- number 800364974), a
Domestic Nonprofit Corporation, was filed in this office on July 14, 2004.
It is further certified that the entity status in Texas is in existence.
In testimony whereof, I have hereunto signed my name
officially and caused to be impressed hereon the Seal of
State at my office in Austin, Texas on May 08, 2012.
1
(If
Hope Andrade
Secretary of State
Come visit us on the internet at http://www.sos.state.tx.us/
Phone: (512) 463-5555 Fax: (512) 463-5709 Dial: 7-1-1 for Relay Services
Prepared by: SOS-WEB TID: 10264 Document: 420704290003
EXHIBIT D
Certificate of Good Standing
1-IOU:3213719.1
Certificate of Account Status - Exempt Letter Page 1 of 1
EXHJBT 1?
TEXAS Corti rxoLLER OF Pusuuc ACCOUNTS
C.AROLE KEETON STRAThORN • COMPTROLLER • AUSTIN, TEXAS 78774
November 10, 2004
CERTIFICATE OF ACCOUNT STATUS
THE STATE OF TEXAS
COUNTY OF TRAVIS
I, Carole Keeton Strayhorn, Comptroller of Public Accounts of the State of
Texas, DO HEREBY CERTIFY that according to the records of this office
DEVELOPMENT AUTHORITY OF PEARLAND
is exempt from payment of franchise tax and consequently is in good standing
with this office.
GIVEN UNDER MY HAND AND
SEAL OF OFFICE in the City of
Austin, this 10th day of
November, 2004 A.D.
Carole Keeton Strayhorn
Texas Comptroller
Taxpayer number: 12016779725
File number: 0800364974
Form 05-303(Rev. 1-03/6)
. http://ecpa.cpa.state.tx.us/coa/servlet/cpa.app.coa.CoaLetter 11/10/2004
EXHIBIT E
Combined Debt Service Schedule
Oevopneit Authority of Peadand. Texas
Current Debt pkrs New Debt
FINAL NIJM080S- Tax nen'tent Contract Revenue and Reftnding Sods, Series 2012
Dated Date 0512212012 New•Mev1eu Deliverer Date 85?2212012
New Interest Interest
Year Current Principal 3-07050 3.075%Total Total New Tot Debt
Sndlng Debt Due Dwe Due New Principal
3320 Requirement 09101 02104 88101 Interest & Interest Requirement
2012 2,973.245 5,1200 27438 27,43&282.433 4,310,334
20.13 0.270,583 313,800 45,208 43,205 90,412 405,412 4,033,013
2014 2.075.770 325,800 40,371 40.371 80,741 403,741 4,381,311
2815 2,970,787 333,303 33,332 35.332 70,784 400,754 4,289,551
2015 3,076.340 348.008 30,316 30.335 50,833 403.833 4.373,081
21317 2,9313,683 355,000 23,007 25,007 50,195 4133,105 .4,385,882
2019 3.077.257 385,800 10,848 19.543 28,208 404,298 4,381,553
2010 3376.484 375,303 14,048 34,045 28,091 403,091 4,370,343
2020 3,383,035 285.000 8,2.80 e..289 16,578 281.578 4,344,613
2021 3,860.388 275,360 4,221 4,221 8,443 283,443 4,143.820
2822 3.800,120 ..3,900128
2023 1,057.187 3,057,107
2024 3.866.016 3,333,033
2023 2.362.039 3,082.080
2025 3.8854005 .3,859.005
2027 3.254337 3,854,037
2028 2.851.566 3,051,565
2020 3,880.972 3.858372
rotafs 078454,312 03,250,000 .5223,575 3250,813 .5472,561 03.723,591 974.17G,900
NEWI2: Dated Date: 0512212012 Principal Due Dates: 09)91/2012 - 32101/220.21 MaturingAmuo1: 325e0O0.08
HOU:3213719.1
EXHIBIT F
Schedule Of Pledged Revenue Collections
Tax Year Increment Collection
2009 $ 9,974,707
2010 11,688,990
2011 10,233,939
HOU:3213719.3
GENERAL CERTIFICATE OF THE CITY OF PEARLAND, TEXAS
I, the undersigned, City Secretary of the City of Pearland, Texas (the "City"), make this
certification for the benefit of the Attorney General of the State of Texas and all persons
interested in the proceedings for the issuance of the Tax Increment Contract Revenue and
Refunding Bonds, Series 2012 (the `Bonds"), now in process of issuance by the Development
Authority of Pearland.
The following persons are the current members of the City Council of the City:
Tom Reid
Scott Sherman
Woodrow "Woody" Owens
Susan Sherrouse
Felicia Harris
Greg Hill
Mayor
Mayor Pro Tem/Councilmember, Position 2
Councilmember, Position 1
Councilmember, Position 3
Councilmember, Position 4
Councilmember, Position 5
2. Bill Eisen is the City Manager, Claire Bogard is the Director of Finance, Young
Lorfing is the City Secretary and Darrin Coker is the City Attorney of the City.
WITNESS MY HAND AND THE OFFICIAL SEAL OF THE CITY, this J day of
May, 2012.
CITY OF PEARLAND, TEXAS
I-IOU:3217873.1
CERTIFICATE OF COVERAGE
I, the undersigned, Director of Finance of the City of Pearland, Texas, in relation to the
Development Authority of Pearland Tax Increment Contract Revenue and Refunding Bonds,
Series 2012 (the "Bonds"), hereby certifies as follows:
The Captured Appraised Value which, at the Participants' current tax rates, will generate
Contract Tax Increments that will be at least 125 percent of projected Average Annual Debt
Service of the Bonds. Capitalized in the preceding sentence shall have the meaning ascribed
thereto in the Indenture.
Capitalized terms used herein but undefined shall have the meaning set forth in the
Indenture of Trust for the Bonds, dated May 1, 2012.
DEVELOPMENT AUTHORITY OF
PEARLAND
Dated: May 22, 2012 By:
Claire Bogard
Director of Finance
HOU:3219048.1
SIGNATURE IDENTIFICATION AND
NO-LITIGATION CERTIFICATE
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
We, the undersigned officers of the Development Authority of Pearland (the
"Authority"), certify that we officially signed, by our manual or facsimile signatures, on behalf
of the Corporation, the following described bonds, to wit:
DEVELOPMENT AUTHORITY OF PEARLAND TAX INCREMENT
CONTRACT REVENUE AND REFUNDING BONDS, SERIES 2012, dated
May 1, 2012, in the original aggregate principal amount of $56,915,000 (the
"Bonds").
That the Bonds have been duly and officially executed by the undersigned with their
manual or facsimile signatures in the same manner appearing hereon, and the undersigned hereby
adopt and ratify their respective signatures in the manner appearing on each of the Bonds,
whether in manual or facsimile form, as the case may be, as their own signatures.
That on the date of such signing and on the date hereof, we were and are the duly chosen,
qualified and acting officers authorized to execute the Bonds.
We further certify that no litigation is pending or, to our knowledge, threatened in any
court to restrain or enjoin the issuance or delivery of the Bonds, or the levy, collection or
application of the sales taxes pledged or to be pledged to pay the principal of and interest on the
Bonds, or the pledge thereof, or in any way contesting or affecting the validity of the Bonds, the
resolution dated April 30, 2012 authorizing the issuance, sale and delivery of the Bonds (the
"Resolution"), or contesting the powers of the Corporation or the authorization of the Bonds or
the Resolution.
We further certify that the information and data contained in the General Certificate dated
April 30, 2012, remain true and correct as of this date.
HOU:3213999.1
Notary Public
MARIA ESCALANTE RODRIGUFL
NOTARY PUBLIC
STATE OF TEXA S _
Commission F^cpires 02-02-2013
Typed or Printed Name:
My Commission Expires:
2'
(Notary Seal)
WITNESS OUR HANDS AND THE SEAL OF THE CORPORATION this
L , 2012.
SIGNATURES TITLE OF OFFICE
Chair
Secretary
Before me, on this day personally appeared the foregoing individuals, known to me to be
the persons whose names were subscribed in my presence to the foregoing instrument.
Given under my hand and seal of office this3'"day of , 2012.
HOU:3213999.1
ATTORNEY GENERAL OF TEXAS
GREG ABBOTT
May 21, 2012
THIS IS TO CERTIFY that the Development Authority of Pearland (the
"Issuer") has submitted to me Development Authority of Pearland Tax Increment
Contract Revenue and Refunding Bond, Series 2012 (the "Bond") in the principal
amount of $56,915,000 for approval. The Bond is dated May 1, 2012, numbered I-1,
and was authorized by a Resolution of the Issuer passed on April 30, 2012 (the
"Resolution").
I have examined the law and such certified proceedings and other papers as I deem necessary
to render this opinion.
As to questions of fact material to my opinion, I have relied upon representations of the Issuer
contained in the certified proceedings and other certifications of public officials furnished to me
without undertaking to verify the same by independent investigation.
I express no opinion relating to the official statement or any other offering material relating
to the Bond.
I have not investigated the sufficiency of the security for the Bond or the probability of
payment as specified therein, and express no opinion with respect thereto.
Based on my examination, I am of the opinion, as of the date hereof and under existing law,
as follows (capitalized terms, except as herein defined, have the meanings given to them in the
Resolution):
(1)The Bond has been issued in accordance with law and is a valid and binding limited
obligation of the Issuer.
(2)The Bond is payable from and equally and ratably secured by a lien on the Pledged
Revenues.
(3)The Bond does not constitute, within the meaning of any statutory or constitutional
provision, an indebtedness, an obligation or a loan of credit of the City of Pearland,
Texas, the State of Texas, Alvin Independent School District, Brazoria County,
Texas, Fort Bend County, Texas or any other municipality, county, or other
municipal or political corporation or subdivision of the State of Texas. Neither the
City of Pearland, Texas nor Alvin Independent School District, Brazoria County,
Texas, nor Fort Bend County, Texas is obligated to make payments on the Bond.
POST OFFICE Box 12548, AUSTIN, TEXAS 78711-2548 TEL: (512) 463-2100 WWW.TEXASATTORNEYGENERA L. GOV
An Equal Employment Opportunity Employer - Printed on Recycled Paper
Development Authority of Pearland Tax Increment Contract Revenue and Refunding Bond, Series
2012 - $56,915,000
- Page 2 -
Therefore, the Bond is approved.
The Comptroller is instructed that she may register the Bond without the cancellation of the
underlying securities being refunded thereby.
No. 53701
Attorney . : ral of the State. of Texas,
Book No. 2012-B
MA
OFFICE OF COMPTROLLER
OF THE STATE OF TEXAS
I, Melissa Mora, q Bond Clerk OX Assistant Bond Clerk in the office of the Comptroller of the State
of Texas, do hereby certify that, acting under the direction and authority of the Comptroller on the
21st day of May, 2012, I signed the name of the Comptroller to the certificate of registration
endorsed upon the:
Development Authority of Pearland, Tax Increment Contract Revenue and Refunding Bond, Series
2012,
numbered I-1, dated May 1, 2012, and that in signing the certificate of registration I used the
following signature:
IN WITNESS cate this the 21st day of May, 2012.
I, Susan Combs, Comptroller of Public Accounts of the State of Texas, certify that the person
who has signed the above certificate was duly designated and appointed by me under authority
vested in me by Chapter 403, Subchapter H, Government Code, with authority to sign my name to
all certificates of registration, and/or cancellation of bonds required by law to be registered and/or
cancelled by me, and was acting as such on the date first mentioned in this certificate, and that the
bonds/certificates described in this certificate have been duly registered in the office of the
Comptroller, under Registration Number 80098.
GIVEN under my hand and seal of office at Austin, Texas, this the 21st day of May, 2012.
SUSAN COMBS
Comptroller of Public Accounts
of the State of Texas
OFFICE OF COMPTROLLER
OF THE STATE OF TEXAS
I, SUSAN COMBS, Comptroller of Public Accounts of the State of Texas,
do hereby certify that the attachment is a true and correct copy of the opinion of
the Attorney General approving the:
Development Authority of Pearland, Tax Increment Contract Revenue and
Refunding Bond, Series 2012
numbered 1-1, of the denomination of $ 56,915,000, dated May 1, 2012, as
authorized by issuer, interest 3.07 percent, under and by authority of which said
bonds/certificates were registered electronically in the office of the Comptroller,
on the 21st day of May, 2012, under Registration Number 80098.
Given under my hand and seal of office, at Austin, Texas, the 21st day of
May, 2012.
L £..
SUSAN COMBS
Comptroller of Public Accounts
of the State of Texas
FEDERAL TAX CERTIFICATE
I, the undersigned officer of the Development Authority of Pearland (the
"Authority"), make this certification for the benefit of all persons interested in the
exclusion from gross income for federal income tax purposes of the interest to be paid
on the Authority's Tax Increment Contract Revenue and Refunding Bonds, Series 2012
(the "Bonds"), which are being issued in the aggregate principal amount of $56,915,000
and delivered simultaneously with the delivery of this certificate. I do hereby certify as
follows in good faith on the date of issue of the Bonds:
1.Responsible Officer. I am the duly chosen, qualified and acting officer of
the Authority for the office shown below my signature; as such, I am familiar with the
facts herein certified and I am duly authorized to execute and deliver this certificate on
behalf of the Authority. I am the officer of the Authority charged, along with other
officers of the Authority, with responsibility for issuing the Bonds.
2.Code and Regulations. The Bonds are subject to the provisions of sections
141, 148, 149 and 150 of the Internal Revenue Code of 1986, as amended (the "Code"),
and the Treasury Regulations (the "Regulations") heretofore promulgated under
sections 141, 148, 149 and 150 of the Code. These provisions of the Code and
Regulations impose restrictions on the use of bond-financed facilities and on the
investment of bond proceeds. This certificate is being executed and delivered pursuant
to sections 1.141-1 through 1.141-15, 1.148-0 through 1.148-11, 1.149(b)-1, 1.149(d)-1,
1.149(g)-1, 1.150-1 and 1.150-2 of the Regulations.
3.Definitions. The capitalized terms used in this certificate (unless
otherwise defined) that are defined in the Resolution authorizing the issuance of the
Bonds dated April 30, 2012 and the Indenture of Trust dated as of May 1, 2012 between
the Authority and Regions Bank, as Trustee (the "Indenture" and, together with the
Resolution, the "Bond Documents") shall for all purposes hereof have the meanings
therein specified. All such terms defined in the Code or Regulations shall for all
purposes hereof have the same meanings as given to those terms in the Code and
Regulations unless the context clearly requires otherwise.
4.Reasonable Expectations. The facts and estimates that are set forth in this
certificate are accurate. The expectations that are set forth in this certificate are
reasonable in light of such facts and estimates. There are no other facts or estimates that
would materially change such expectations. In connection with this certificate, the
undersigned has to the extent necessary reviewed the certifications set forth herein with
other representatives of the Authority as to such accuracy and reasonableness. The
undersigned has also relied, to the extent appropriate, on representations set forth in
the certificate of Capital One Public Funding, LLC, the initial purchaser of the Bonds
(the "Initial Purchaser"), attached hereto as Exhibit A, the certificate of BOSC, Inc., the
Authority's financial advisor, attached hereto as Exhibit B, and the report (the "Report")
of Grant Thornton LLP, certified public accountants, dated May 22, 2012 and attached
as an exhibit to the escrow agreement dated as of May 1, 2012 between the Authority.
and Regions Bank, as escrow agent (the "Escrow Agreement"). The undersigned is
aware of no fact, estimate or circumstance that would create any doubt regarding the
accuracy or reasonableness of all or any portion of such documents.
5. Description of Governmental Purpose. The Authority is issuing the Bonds
pursuant to the Bond Documents (a) to provide funds that will be used to advance
refund and defease the entire outstanding principal amount of the Authority's Tax
Increment Contract Revenue Bonds, Series 2004, originally issued in the amount of
$13,995,000 (the "Series 2004 Bonds"), the Authority's Tax Increment Contract Revenue
Bonds, Series 2005, originally issued in the amount of $9,775,000 (the "Series 2005
Bonds"), the Authority's Tax Increment Contract Revenue Bonds, Series 2006, originally
issued in the amount of $9,970,000 (the "Series. _2006 Bonds"), the Authority's Tax
Increment Contract Revenue Bonds, Series 2007, originally issued in the amount of
$15,950,000 (the "Series 2007 Bonds") and the Authority's Tax Increment Contract
Revenue Bonds, Series 2009, originally issued in the amount of $8,815,000 (the "Series
2009 Bonds" and, together with the Series 2004 Bonds, the Series 2005 Bonds, the Series
2006 Bonds and the Series 2007 Bonds, the "Prior Bonds"), pursuant to the Escrow
Agreement, (b) to pay costs of water, wastewater and storm sewer improvements,
streets, drainage, parks and sidewalks within Shadow Creek Ranch, as set forth in the
Project Plan (the "New Money Project") and (c) to pay the costs of issuance of the
Bonds. The Report details all relevant aspects of the application of the proceeds of the
Bonds and the Authority's program to refund the Prior Bonds. Specifically, all of the
Series 2004 Bonds maturing on September 1, 2012 through September 1, 2016, inclusive,
September 1, 2019, September 1, 2021, September 1, 2023 and September 1, 2028, in the
amount of $10,810,000, the Series 2005 Bonds maturing on September 1, 2012 through
September 1, 2021, inclusive, September 1, 2025 and September 1, 2028, in the amount of
$7,225,000, the Series 2006 Bonds maturing on September 1, 2012 through September 1,
2026, inclusive, and September 1, 2028, in the amount of $8,570,000, the Series 2007
Bonds maturing on September 1, 2012 through September 1, 2027, inclusive, and
September 1, 2029, in the amount of $14,415,000, and the Series 20079 Bonds maturing
on September 1, 2012 through September 1, 2023, inclusive, September 1, 2026,
September 1, 2027 and September 1, 2029 in the amount of $8,210,000 (collectively, the
"Refunded Bonds") will be called for redemption and retired with proceeds of the
Bonds. The Refunded Bonds are being defeased in order to achieve a present-value
savings in the debt service payable by the Authority. September 1, 2014 is the first date
on which the Refunded Bonds that are Series 2004 Bonds are subject to optional
redemption, September 1, 2015 is the first date on which the Refunded Bonds that are
Series 2005 Bonds are subject to optional redemption, September 1, 2016 is the first date
on which the Refunded Bonds that are Series 2006 Bonds are subject to optional
redemption, September 1, 2012 is the first date on which the Refunded Bonds that are
Series 2007 Bonds are subject to optional redemption and September 1, 2018 is the first
-2-
date on which the Refunded Bonds that are Series 2009 Bonds are subject to optional
redemption and on such dates all of the Refunded Bonds will be called for redemption
in advance of their scheduled maturities and retired with proceeds of the Bonds. The
Authority has no present intent to issue any additional bonds. The Bonds are the first
advance refunding of the Refunded Bonds, all of which are original bonds.
6.The Prior Bonds. No portion of the purchase price of any of the Prior
Bonds was provided by the issuance of any other issue of obligations. All of the
original and investment proceeds allocable to the Prior Bonds have been expended. No
portion of the proceeds of, the Prior Bonds was used to pay the principal of, or interest
on, any other issue of governmental obligations. In addition, other than to the extent of
preliminary expenditures (i.e., architectural, engineering, surveying, soil testing,
reimbursement bond issuance, and similar costs that are incurred prior to
commencement of acquisition, construction, or rehabilitation of .a project, other than
land acquisition, site preparation, and. similar costs incident, to commencement of
construction), no portion of the proceeds of the Prior Bonds was used to reimburse the
Authority for any expenditures made by the Authority prior to the respective issuance
dates of the Prior Bonds.
The Authority has maintained a debt service fund (the "Debt Service Fund") and
a debt service reserve fund (the "Reserve Fund") for the Prior Bonds and has on hand in
such funds certain amounts that were to be used for the payment of debt service or to
secure the payment of debt service on the Prior Bonds. The Debt Service Fund will be
continued for the payment of debt service on the Bonds under the Bond Documents for
purposes of the payment of debt service on the Bonds as described in paragraph 16
below. The Reserve Fund is no longer required.
The balance in the Reserve Fund as of the date of this certificate (the "Reserve
Fund Amount") is approximately $1,374,330.00. The Reserve Fund Amount is allocable
to the Refunded Bonds. Such amount will be deposited into the escrow fund created
under the Escrow Agreement (the "Escrow Fund") and used on the date hereof together
with proceeds of the Bonds to purchase United States Treasury Obligations in the open
market (the "Escrowed Securities"), the proceeds of which will be used as described in
the Report to pay the principal of, and interest on, the Refunded Bonds.
7.Use of Amounts Allocable to Prior Bonds. Other than amounts described
in paragraph 6 above, there are no amounts on hand that represent proceeds of the
Prior Bonds, replacement proceeds of the Prior Bonds or accumulated earnings on such
proceeds.
8.Expenditure of Proceeds of the Bonds. The sale proceeds from the
issuance of the Bonds will be $56,915,000.00. Such amount represents the stated
redemption price at maturity (excluding accrued interest for those Bonds the interest on
which is paid at least once annually) of the Bonds, equal to $56,915,000.00. No portion of
-3-
the purchase price of any of the Bonds is provided by the issuance of any other issue of
obligations. The sale proceeds will be expended as follows:
(a)The amount of $53,372,254.46 will be deposited in the Escrow Fund and
used on the date hereof to purchase Escrowed Securities, the proceeds of which will be
used as described in the Report to pay the principal of, and interest and redemption
premium, if any, on, the Refunded Bonds. No portion of the proceeds of the Bonds is
expected to be used to pay any interest on, or principal of, any issue of governmental
obligations other than the Bonds and the Refunded Bonds.
(b)The amount of $289,500.00 will be disbursed to pay costs of issuance on
the Bonds.
(c)The amount of $3,099.76 represents a rounding amount and will be
deposited in the Project Fund and used to pay additional costs of the New Money
Project.
(d)The amount of $145.78 will be deposited as the initial cash balance in the
Escrow Fund and disbursed on September 1, 2012 to pay debt service on the Refunded
Bonds. Pending disbursement, such amount will not be invested.
(e)The amount of $3,250,000.00 will be deposited in the Project Fund and
used to pay the costs of the New Money Project. The aggregate amount of the costs of
acquisition and construction of the New Money Project is anticipated to be not less than
such amount. Any costs of the New Money Project not financed out of original or
investment proceeds of the Bonds will be financed out of the Authority's available
funds.
9.Pre-issuance Accrued Interest. Interest on the Bonds begins to accrue
from the date of delivery. Accordingly, the Authority will not receive any amount
representing accrued interest on the Bonds.
10.Investment Proceeds. The amount described in paragraph 8(d) will not be
invested. Except for earnings on the amounts described in paragraphs 8(b), 8(c) and
8(e), the amounts, if any, earned by the Authority from investments pursuant to Section
4.02 of the Escrow Agreement, and the amount of $7.08 set forth in the Report as the
amount expected to be remaining in the Escrow Fund following the final debt service
payment with respect to the Refunded Bonds on September 1, 2018, all amounts
received by the Authority, such as interest and dividends, resulting from the
investment of any original proceeds or investment proceeds of the Bonds will be
deposited in the Escrow Fund for the Refunded Bonds and used to pay the principal of,
and interest and redemption premium, if any, on, the Refunded Bonds. Earnings on the
amounts described in paragraphs 8(b), 8(c) and 8(e) will be used for one of the purposes
described in such paragraphs.
0
11.Transferred Proceeds. There are no other transferred proceeds with
respect to the Bonds because all of the proceeds of Refunded Bonds have been or will be
expended prior to the first dates on which amounts are disbursed from the Escrow
Fund to pay principal of the Refunded Bonds.
12.No Replacement Proceeds. Other than amounts described herein, there
are no amounts that have a sufficiently direct nexus to the Bonds or to the governmental
purposes of the Bonds, including the expected use of amounts to pay debt service on
the Refunded Bonds, that the amounts would have been used for such purpose if the
proceeds of the Bonds were not used or to be used for such purpose.
(a)No Sinking Funds. unds. Other than to the extent described herein, there is no
debt service fund, redemption fund, reserve fund, replacement fund, or similar fund
reasonably expected to be used directly or indirectly to pay principal or interest on the
Bonds.
(b)No Pledged Funds. Other than amounts described herein, there is no
amount that is directly or indirectly, other than solely by reason of the mere availability
or preliminary earmarking, pledged to pay principal or interest on the Bonds, or to a
guarantor of part or all of the Bonds, such that such pledge provides reasonable
assurance that such amount will be available to pay principal or interest on the Bonds if
the Authority encounters financial difficulty. For purposes of this certification, an
amount is treated as so pledged if it is held under an agreement to maintain the amount
at a particular level for the direct or indirect benefit of the holders or the guarantor of
the Bonds.
(c)No Other Replacement Proceeds. There are no other replacement
proceeds allocable to the Bonds because the Authority reasonably expects that the term
of the Bonds will not be longer than is reasonably necessary for the governmental
purposes of the Bonds. Furthermore, if the term of the Bonds is longer than is
reasonably necessary for the governmental purposes of the Bonds, the Authority does
not reasonably expect to have available amounts during the portion of such period that
is longer than is reasonably necessary. The Bonds would be issued to achieve a debt
service savings independent of any arbitrage benefit as evidenced by the expectation
that the Bonds reasonably would have been issued if the interest on the Bonds were
included in gross income (assuming that the hypothetical taxable interest rate would be
the same as the actual tax-exempt interest rate).
(d)Weighted Average Maturity. The weighted average maturity of the Bonds
does not exceed the remaining weighted average maturity of the Refunded Bonds and
the weighted average maturity of the Refunded Bonds is not greater than 120 percent of
the weighted average estimated economic life of the portion of the New Money Project
financed by the Refunded Bonds, determined in accordance with section 147(b) of the
Code. Such weighted average estimated economic life is determined in accordance
-5-
with the following assumptions: (a) The weighted average was determined by taking
into account the respective costs of each of the assets financed by the Refunded Bonds;
(b) the reasonably expected economic life of an asset was determined as of the later of
the date hereof or the date on which such asset is expected to be placed in service (i.e.,
available for use for the intended purposes of such asset); (c) the economic lives used in
making this determination are not greater than the useful lives used for depreciation
under section 167 of the Code prior to the enactment of the current system of
depreciation in effect under section 168 of the Code (i.e., the "mid-point lives") under
the asset depreciation range ("ADR") system of section 167(m) of the Code, as set forth
in Revenue Procedure 83-35, 1983-1 C.B. 745, where applicable, and the "guideline
lives" under Revenue Procedure 62-21, 1962-2 C.B. 418, in the case of structures; and (d)
land or any interest therein has not been taken into account in determining the average
reasonably expected economic life of such Project, unless 25 percent or more of the net
proceeds of any issue is to be used to finance land.
13. No Excess Gross Proceeds. Except for the amounts described in
paragraph 8(c) above, earnings on the amounts described in paragraphs 8(b) and 8(c)
above, and the amount of $7.08 described in paragraph 10 above, all gross proceeds of
the Bonds are allocable to:
(a)the payment of principal, interest or call premium on the Refunded Bonds
as described in paragraph 8(a) above;
(b)the payment of pre-issuance accrued interest on the Bonds as described in
paragraph 9 above;
(c)the payment of costs of issuance of the Bonds as described in paragraph
8(b) above;
(d)a reasonably required reserve or replacement fund as described in
paragraph 7 above and paragraph 16 below;
(e)the payment of administrative costs allocable to repaying the Refunded
Bonds, carrying and repaying the Bonds or investments of the Bonds;
(f)transferred proceeds allocable to expenditures for the governmental
purpose of the Prior Bonds as described in paragraph 7 above;
(g)replacement proceeds in a sinking fund for the Bonds; and
(h)costs of the New Money Project.
Investment earnings on the amounts described in paragraphs 8(b) and 8(c) are
expected to be de minimis; therefore, the sum of the investment earnings on the
amounts described in paragraphs 8(b) and 8(c), the amount described in paragraph 8(c)
Ii'
and the amount described in paragraph 10 will be less than one percent of the original
proceeds of the Bonds. Under Section 4.02 of the Escrow Agreement, the Escrow Agent
will reinvest certain cash balances in the Escrow Fund pending their use to pay debt
service on the Refunded Bonds. The yield that such investments are expected to earn,
based on current interest rates for investments with maturities similar to such
investments, will be less than the yield on the Bonds. Accordingly, and as set forth in
paragraph 10 above, the amount earned from such investments is not expected to
exceed an amount which, when aggregated with other amounts described herein,
exceeds one percent of the original proceeds of the Bonds.
14.Yield on the Bonds. The Bonds bear interest at a variable rate. For
purposes of this certificate, the yield on the Bonds is computed separately for each
computation period. The yield for each computation period is the discount rate that,
when used in computing the present value as of the first day of the computation period
of all of the payments of principal, interest and fees for qualified guarantees, if any, on
the Bonds that are attributable to the computation period, produces an amount equal to
the present value, using the same discount rate, of the aggregate issue price of the
Bonds as of the issue date. For purposes of determining the yield on the Bonds, the
issue price of the Bonds is the price paid by the Initial Purchaser. The issue price is
based on the representations of the Initial Purchaser set forth in Exhibit A. No issuance
costs, or costs of carrying or repaying the Bonds are taken into account for purposes of
computing the yield on the Bonds. Based upon the representations of the Initial
Purchaser set forth in Exhibit A hereto, the issue price of the Bonds aggregated
$56,915,000.00.
The yield on the Bonds through the first computation period, as shown in the
Report, is 3.071183 percent. The yield on the Bonds through the second computation
period, as shown in the Report, is 3.071199 percent.
15.Temporary Periods and Yield Restriction.
(a) New Money Project. The Authority has incurred or will incur within six
months of the date hereof a binding obligation to a third party which is not subject to
any contingencies within the control of the Authority or a related party pursuant to
which the Authority is obligated to expend at least five percent of the sale proceeds of
the Bonds on the New Money Project. The Authority reasonably expects that work on
or acquisition of the New Money Project will proceed with due diligence to completion
and that the proceeds of the Bonds will be expended on the New Money Project with
reasonable dispatch. The Authority reasonably expects that 85 percent of the sale
proceeds of the Bonds will have been expended on the New Money Project prior to the
date that is three years after the issue date. Any sale proceeds not expended prior to the
date that is three years after the issue date, will be invested at a yield not "materially
higher" than the yield on the Bonds, except as set forth in paragraph 13 below. The
Authority reasonably expects that any amount derived from the investment of moneys
-7-
received from the sale of the Bonds and from the investment of such investment income
will not be commingled with substantial other receipts or revenues of the Authority and
will be expended prior to the date that is three years after the issue date, or one year
after receipt of such investment income, whichever is later. Any such investment
proceeds not expended prior to such date will be invested at a yield not "materially
higher" than the yield on the Bonds, except as set forth in paragraph 13 below.
(b)Uninvested Amounts. The amounts described in paragraph 8(d) will not
be invested and, therefore, are not subject to yield restriction.
(c)Issuance Costs. It is expected that the amount described in paragraph 8(b)
will be disbursed within 13 months of the date hereof for costs of issuing the Bonds;
therefore, such amount will be invested for an allowable temporary period. To the
extent any portion of the amount described in paragraph 8(b) is not expended as
described herein, the Authority will take steps to restrict the investment of such
amounts to a yield which is not materially higher than the yield on the Bonds.
(d)Rounding Amount. The amount described in paragraph 8(c) will be
invested at a yield that is not higher than the yield on the Bonds.
(e)Yield on the Escrowed Securities. The yield on the Escrowed Securities is
computed using the same compounding interval and financial conventions used to
compute the yield on the Bonds. The yield on the Escrowed Securities is the discount
rate that, when used in computing the present value as of the date the Escrowed
Securities were first allocated to the Bonds of all unconditionally payable receipts to be
actually or constructively received from the Escrowed Securities, produces an amount
equal to the amounts to be actually or constructively paid for the Escrowed Securities.
The Escrowed Securities are all yield restricted nonpurpose investments that are a
single class of investments and that are treated as a single investment because all of the
Escrowed Securities were purchased with Bond proceeds and held in a refunding
escrow as described in paragraph 8(a) above. The Authority has allocated gross
proceeds of the Bonds in the amount described in paragraph 8(a) above to the purchase
of the Escrowed Securities in accordance with section 1.148-6(c) of the Regulations. The
amount shown in paragraph 8(a) is the sum of the purchase prices shown for the
Escrowed Securities in the Report. The payment for each of the Escrowed Securities set•
forth in the Report and aggregating the amount shown in paragraph 8(a) does not
exceed the fair market value of such Escrowed Securities determined on the date on
which a contract to purchase the Escrowed Securities became binding and adjusted to
take into account qualified administrative costs allocable to each such Escrowed
Security. For this purpose, the fair market value of an Escrowed Security is the price at
which a willing buyer would purchase the investment from a willing seller in a bona
fide, arm's length transaction. Each of the Escrowed Securities is of a type traded on an
established securities market. Further for this purpose, qualified administrative costs
that are taken into account in determining payments and receipts on the Escrowed
Securities include only costs and expenses paid, directly or indirectly to purchase, sell
or retire the Escrowed Securities that are reasonable, direct administrative costs other
than carrying costs, legal and accounting fees, recordkeeping and customary costs and
general overhead and similar indirect costs. The amount and nature of such
administrative costs taken into account with respect to the Escrowed Securities are
comparable to administrative costs that would be charged for the same investment or a
reasonably comparable investment if acquired with a source of funds other than gross
proceeds of tax-exempt bonds. The Escrowed Securities were acquired in arm's-length
transactions and no amounts were paid to reduce the yield on such securities below the
market yield. As shown in the Report, the yield on the Escrowed Securities, determined
in the manner set forth in this paragraph and based on a purchase price for the
Escrowed Securities of $54,746,584.46, is 0.828451 percent, a yield that is not higher than
the yield on the Bonds. As set forth in paragraph 10 above, Section 4.02 of the Escrow
Agreement provides that certain cash balances in the Escrow Fund can be reinvested.
Based on current interest rates for investments with maturities similar to such
investments, the reinvestment of these balances is expected to be at a yield not in excess
of the yield on the Bonds.
Pursuant to section 1.148-9(g) of the Regulations, the Authority hereby elects to
waive the temporary period available with respect to those proceeds of the Bonds
deposited in the Escrow Fund as described in paragraph 8(a) above to the extent such
proceeds are used to purchase investments the proceeds of which are to be used to pay
debt service on the Refunded Bonds.
The Authority has covenanted in the Bond Documents to comply with, among
other things, the requirements of section 148(d) of the Code and, if required, the
Authority will satisfy this requirement with respect to earnings on the Escrowed
Securities out of funds other than those in the Escrow Fund.
(f)Waiver of 30-Day Temporary Period. Pursuant to section 1.148-9(g) of the
Regulations, the Authority hereby elects to waive the 30-day temporary period
available under section 1.148-9(d)(2)(i) of the Regulations.
(g)Reserve Fund Amount. Until such amounts are expended, the Reserve
Fund Amount will be invested at all times at a yield that does not exceed the yield on
any series of Prior Bonds. The Reserve Fund Amount will not be allocated to
expenditures for principal, interest or stated redemption price on the Refunded Bonds
faster than ratably with proceeds of the Bonds in the Escrow Fund, as required by
Section 1.148-9(c)(2)(i) of the Regulations. .
16. Funds.
(a) Debt Service Fund. Pursuant to the Indenture, the Authority has
confirmed the debt service fund designated the "Debt Service Fund," which will be
0
used primarily to achieve a proper matching of revenues and debt service on the Bonds,
within each Bond Year. The revenues are anticipated to be sufficient to pay debt service
each year on the Bonds. The Debt Service Fund will be depleted at least once each year
except for a reasonable carryover amount not to exceed the greater of (a) one year's
earnings on the Debt Service Fund or (b) one-twelfth of annual debt service. The
Authority reasonably expects that any such revenues deposited in the Debt Service
Fund will be disbursed within 13 months of the date of receipt of such revenues by the
Authority. Amounts on deposit in the Debt Service Fund may be invested for an
allowable temporary period of 13 months from the date such amount are deposited into
the Debt Service Fund. Any such amount not expended within such period will be
invested at a yield not "materially higher" than the yield on the Bonds, except as set
forth in paragraph 17 below.
(b) Reserve Fund. The Reserve Fund confirmed in the Indenture will be used
to secure payment of debt service on the Bonds in the event that the monies in the Debt
Service Fund are insufficient. The Authority will periodically deposit revenues into the
Reserve Fund in an amount sufficient to cause the balance in the Reserve Fund to be at
least equal to the Reserve Fund requirement as defined in the Resolution. The
Resolution for the Bonds does not provide for a Reserve Requirement. To the extent
that the portion of the amount in deposit in the Reserve Fund allocable to the Bonds, if
any, in the aggregate exceeds the least of (a) ten percent of the stated principal amount
of the Bonds (or sale proceeds in the event that the amount of original issue discount
exceeds two percent multiplied by the stated redemption price at maturity of the
Bonds), (b) the maximum annual principal and interest requirements of the Bonds, and
(c) 125 percent of average annual principal and interest requirements of the Bonds, such
excess will be invested in obligations the yield on which is not in excess of the yield on
the Bonds, except as set forth in paragraph 17 below.
17.Minor Portion. All gross proceeds will be invested in accordance with
paragraphs 15 and 16 above. To the extent such amounts remain on hand following the
periods set forth in paragraphs 15 and 16 above or exceed the limits set forth in
paragraph 16 above, the Authority will invest such amounts at a restricted yield as set
forth in such paragraphs; provided, however, that a portion of such amounts, not to
exceed in the aggregate the lesser of $100,000 or five percent of the sale proceeds of the
Bonds, may be invested at a yield that is higher than the yield on the Bonds.
18.Issue. There are no other obligations which (a) are sold at substantially
the same time as the Bonds (i.e., within 15 days), (b) are sold pursuant to the same plan
of financing with the Bonds, and (c) will be paid out of substantially the same source of
funds as the Bonds.
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19. Compliance With Rebate Requirements.
(a)General. The Authority has covenanted in the Bond Documents that it
will take all necessary steps to comply with the requirement that "rebatable arbitrage
earnings" on the investment of the "gross proceeds" of the Bonds, within the meaning
of section 148(d) of the Code be rebated to the federal government. Specifically, the
Authority will (a) maintain records regarding the investment of the "gross proceeds" of
the Bonds as may be required to calculate such "rebatable arbitrage earnings"
separately from records of amounts on deposit in the funds and accounts of the
Authority which are allocable to other bond issues of the Authority or moneys which
do not represent "gross proceeds" of any bonds of the Authority, (b) calculate at such
intervals as may be required by applicable Regulations, the amount of "rebatable
arbitrage earnings," if any, earned from the investment of the "gross proceeds" of the
Bonds and. (c) pay, not less often than every fifth anniversary date of the delivery of the
Bonds and within 60 days following the final maturity of the Bonds, or on such other
dates required or permitted by applicable Regulations, all amounts required to be
rebated to the federal government. Further, the Authority will not indirectly pay any
amount otherwise payable to the federal government pursuant to the foregoing
requirements to any person other than the federal government by entering into any
investment arrangement with respect to the "gross proceeds" of the Bonds that might
result in a reduction in the amount required to be paid to the federal government
because such arrangement results in a smaller profit or a larger loss than would have
resulted if the arrangement had been at arm's-length and had the yield on the issue not
been relevant to either party.
(b)Two-Year Spending Exception. The Authority hereby makes the elections,
if any, set forth below for purposes of the two-year spending exception from arbitrage
rebate:
DO NOT
ELECT ELECT N/A
® q q 1. To use actual facts to apply the provisions of
paragraphs (e) through (1n) of section 1.148-7 of the
Regulations. Section 1.148-7(f) (2) of the Regulations.
q q q 2. To exclude earnings on a reasonably required
reserve or replacement fund from the definition of
"available construction proceeds" for purposes of the
spending requirements. Section 1.148-7(i) (2) of the
Regulations.
q ® q 3. To treat the portion of the Tax-Exempt Bonds
that is not a refunding issue as two, and only two,
separate issues, one of which (a) meets the definition
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of a construction issue and (b) is reasonably expected
as of the date hereof to finance all of the construction
expenditures to be financed by the Tax-Exempt Bonds.
Section 1.148-7(j) (1) of the Regulations.
q ® q 4. To pay a penalty (the "1-1/2% penalty") to the
United States in lieu of the obligation to pay arbitrage
rebate on available construction proceeds in the event
that the Tax-Exempt Bonds fail to satisfy any of the
semiannual spending requirements for the two-year
rebate exception. Section 1.148-7(k) (1) of the
Regulations.
The Authority reasonably expects that at least 75 percent of the "available
construction proceeds" of the Bonds, within the meaning of section 1.148-7(i) of the
Regulations, will be allocated to "construction expenditures," within the meaning of
section 1.148-7(g) of the Regulations, for property owned by the Authority.
20. Not an Abusive Transaction.
(a)General. No action taken in connection with the issuance of the Bonds is
or will have the effect of (a) enabling the Authority to exploit, other than during an
allowable temporary period, the difference between tax-exempt and taxable interest
rates to obtain a material financial advantage (including as a result of an investment of
any portion of the gross proceeds of the Bonds over any period of tune,
notwithstanding that, in the aggregate, the gross proceeds of the Bonds are not invested
in higher yielding investments over the term of the Bonds), and (b) overburdening the
tax-exempt bond market by issuing more bonds, issuing bonds earlier, or allowing
bonds to remain outstanding longer than is otherwise reasonably necessary to
accomplish the governmental purposes of the Bonds, based on all the facts and
circumstances. Specifically, (i) the primary purpose of each transaction undertaken in
connection with the issuance of the Bonds is a bona fide governmental purpose; (ii) each
action taken in connection with the issuance of the Bonds would reasonably be taken to
accomplish the governmental purposes of the Bonds if the interest on the Bonds were
not excludable from gross income for federal income tax purposes (assuming the
hypothetical taxable interest rate would be the same as the actual tax-exempt interest
rate on the Bonds); (iii) the proceeds of the Bonds will not exceed by more than a minor
portion the amount necessary to accomplish the governmental purposes of the Bonds
and will in fact not be substantially in excess of the amount of proceeds allocated to
expenditures for the governmental purposes of the Bonds.
(b)No Re-refunding. No portion of the Refunded Bonds has been refunded
or defeased other than by reason of the issuance of the Bonds.
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(c)No Sinking Fund. No portion of the Bonds has a term that has been
lengthened primarily for the purpose of creating a sinking fund or similar fund. with
respect to the Bonds and thereby eliminating significant amounts of negative arbitrage
in the Escrow Fund.
(d)No Noncallable Bonds. The Refunded Bonds do not include any
noncallable Prior. Bonds that have been refunded in order to invest proceeds in the
Escrow Fund allocable to the noncallable Refunded Bonds at a yield that is higher than
the yield on the Bonds and thereby eliminate significant amounts of negative arbitrage
in the Escrow Fund.
(e)No Window Refunding. No portion of the Bonds has been structured
with maturity dates the primary purpose of which is to make available released
revenues that will enable the Authority , to avoid transferred proceeds or to make
available revenues that may be invested to be ultimately used to pay debt service on
another issue of obligations.
(f)No Sale of Conduit Loan. No portion of the gross proceeds of the Prior
Bonds or the Bonds has been or will be used to acquire, finance, or refinance any
conduit loan.
21.No Arbitrage. On the basis of the foregoing facts, estimates and
circumstances, it is expected that the gross proceeds of the Bonds will not be used in a
manner that would cause any of the Bonds to be an "arbitrage bond" within the
meaning of section 148 of the Code and the Regulations. To the best of the knowledge
and belief of the undersigned, there are no other facts, estimates or circumstances that
would materially change such expectations.
22.No Private Use, Payments or Loan Financing.
(a) General. The Authority reasonably expects, as of the date hereof, that no
action or event during the entire stated term of the Bonds will cause either the "private
business tests" or the "private loan financing test," as such terms are defined in the
Regulations, to be met. Specifically,
(i) Not more than 10 percent of the proceeds of the Bonds will be used
and no portion of the proceeds of the Prior Bonds has been used in a trade or business
of a nongovernmental person. For purposes of determining use, the Authority will
apply rules set forth in applicable Regulations and Revenue Procedures promulgated
by the Internal Revenue Service, including, among others, the following rules: (A) Any
activity carried on by a person other than a natural person or a state or local
governmental unit will be treated as a trade or business of a nongovernmental person;
(B) the use of all or any portion of the New Money Project financed by the Prior Bonds
is treated as the direct use of proceeds; (C) a nongovernmental person will be treated as
-13-
a private business user of proceeds of the Bonds or the Prior Bonds as a result of
ownership, actual or beneficial use of the proceeds pursuant to a lease, or a
management or incentive payment contract, or certain other arrangements such as a
take-or-pay or other output-type contract; and (D) the private business use test is met if
a nongovernmental person has special legal entitlements to use directly or indirectly the
New Money Project.
(ii)The Authority has not taken and will not take any deliberate action
that would cause or permit the use of any portion of the New Money Project to change
such that such portion will be deemed to be used in the trade or business of a
nongovernmental person for so long as any of the Bonds remains outstanding (or until
an opinion of nationally recognized bond counsel is received to the effect that such
change in use will not adversely affect the excludability from gross income for federal
income tax purposes of interest payable on the Bonds)... For this purpose any action
within the control of the Authority is treated as a deliberate action. A deliberate action
occurs on the date the Authority enters into a binding contract with a nongovernmental
person for use of the New Money Project that is not subject to any material
contingencies.
(iii)No portion of the proceeds of the Bonds will be directly or
indirectly used to make or finance a loan to any person other than a state or local
governmental unit.
(b) Dispositions of Personal Property in the Ordinary Course. The Authority
does not reasonably expect that it will sell or otherwise dispose of personal property
components of the New Money Project financed with the Bonds other than in the
ordinary course of an established governmental program that satisfies the following
requirements:
(i)The weighted average, maturity of the portion of the Bonds
financing personal property is not greater than 120 percent of the reasonably expected
actual use of such personal property for governmental purposes;
(ii)The reasonably expected fair market value of such personal
property on the date of disposition will be not greater than 25 percent of its cost;
(iii)Such personal property will no longer be suitable for its
governmental purposes on the date of disposition; and
(iv)The Authority is required to deposit amounts received from such
disposition in a commingled fund with substantial tax or other governmental revenues
and the Authority reasonably expects to spend such amounts on governmental
programs within 6 months from the date of commingling.
-14-
(c) Other Agreements. The Authority will not enter into any agreement with
any nongovernmental person regarding the use of all or any portion of the New Money
Project during the stated term of the Bonds unless such agreement will not adversely
affect the treatment of interest on the Bonds as excludable from gross income for federal
income tax purposes.
23.Weighted Average Maturity. The Weighted Average Maturity of the
Bonds set forth on Exhibit B attached to this Certificate is the sum of the products of the
Issue Price of each group of identical Bonds and the number of years to maturity
(determined separately for each group of identical Bonds and taking into account
mandatory redemptions), divided by the aggregate Sale Proceeds of the Bonds.
24.Bonds are not Hedge Bonds. Not more than 50 percent of the proceeds of
the new money portion of the Bonds will be invested in nonpurpose investments (as
defined in section 148(d)(6)(A) of the Code) having a substantially guaranteed yield for
four years or more within the meaning of section 149(g)(3)(A)(ii) of the Code, and the
Authority reasonably expects that at least 85 percent of the spendable proceeds of the
new money portion of the Bonds will be used to carry out the governmental purposes
of the Bonds within the three-year period beginning on the date the Bonds are issued.
Furthermore, the Authority represents that not more than 50 percent of the proceeds of
each issue of which the Refunded Bonds are a part was invested in nonpurpose
investments (as defined in section 148(d)(6)(A) of the Code) having a substantially
guaranteed yield for four years or more within the meaning of section 149(g)(3)(A)(ii) of
the Code, and the Authority reasonably expected at the time each issue of which the
Refunded Bonds are a part was issued that at least 85 percent of the spendable proceeds
of each such issue would be used to carry out the governmental purposes of such issues
within the corresponding three-year period beginning on the respective dates of issue of
such Refunded Bonds.
EXECUTION PAGE FOLLOWS
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DEVELOPMENT AUTHORITY OF
PEARLAND
B y: d4
Tom Reid, Chair
Date: May 22, 2012
-16-
EXHIBIT A
CERTIFICATE OF INITIAL PURCHASER
Capital One Public Funding, LLC is the Initial Purchaser (the "Initial Purchaser")
of the Development Authority of Pearland (the "Authority") Tax Increment Contract
Revenue and Refunding Bonds, Series 2012 in the principal amount of $56,915,000 (the
"Bonds"). I, the undersigned, hereby certify as follows on behalf of the Initial
Purchaser:
1.I am the duly chosen, qualified and acting officer of the Initial
Purchaser for the office shown below my signature; as such, I am familiar with
the facts herein certified and I am duly authorized to execute and deliver this
certificate on behalf of the Initial Purchaser. I am the officer of the Initial
Purchaser charged with responsibility for the Bonds.
2.The Initial Purchaser has purchased the Bonds from the Authority
for an aggregate purchase price of $56,915,000.00, which price includes no
amount of accrued interest. The Initial Purchaser intends to hold the Bonds for
investment purposes and not in the capacity of bondhouse, broker., dealer, or
similar person or organization acting in the capacity of underwriter or
wholesaler. The Bonds are not being offered to the public and is not being issued
in exchange for property. The issue price described above is equal to the fair
market value of the Bonds on the sale date. For this purpose, the sale date is the
first date on which there is a binding contract for the sale or exchange of the
Bonds.
The Initial Purchaser hereby authorizes the Authority to rely on the statements
made herein in connection with making the representations set forth in the Federal Tax
Certificate to which this certificate is attached and in its efforts to comply with the
conditions imposed by the Code on the exclusion of interest on the Bonds from the
gross income of their owners. The Initial Purchaser hereby authorizes Allen Boone
Humphries Robinson LLP and Andrews Kurth LLP to rely on this certificate for
purposes of its opinion regarding the treatment of interest on the Bonds as excludable
from gross income for federal income tax purposes. Capitalized terms used herein and
not otherwise defined have the meaning ascribed to such terms in the Federal Tax
Certificate to which this certificate is attached.
CAPITAL IC DIN LLC
Y: B
^ -
F
^
Title:
Date: May 22, 2012
EXHIBIT B
CERTIFICATE OF FINANCIAL ADVISOR
BOSC, Inc. has acted as financial advisor (the "Financial Advisor") to the
Development Authority of Pearland (the "Authority"), in connection with the sale and
delivery of the Tax Increment Contract Revenue and Refunding Bonds, Series 2012, in
the aggregate amount of $56,915,000.00 (the "Bonds"). In addition, the Financial
Advisor has acted as bidding agent (the "Bidding Agent") in connection with the
purchase of certain investment agreements on behalf of the Authority. I, the
undersigned, hereby certify as follows:
1.I am the duly chosen, qualified and acting officer of the Financial
Advisor for the office shown below my signature; as such, I am familiar with the
facts herein certified and I am duly authorized to execute and deliver this
certificate on behalf of the Financial Advisor. I am the officer of the Financial
Advisor charged, along with other officers of the Financial Advisor, with
responsibility for issuing the Bonds.
2.The Financial Advisor computed the Weighted Average Maturity
of the Bonds to be 9.221 years, as set forth in paragraph 23 of the Federal Tax
Certificate.
3.I have worked closely with representatives of the Authority in
structuring the financial terms of the Bonds and the refunding of the Refunded
Bonds. The Financial Advisor has also performed certain computations that are
the subject of the Report. I hereby confirm that the assumptions that are
described in the Report as provided by the Financial Advisor are true, accurate
and complete. I further hereby represent that to the best of my knowledge the
statements set forth in paragraph 20 of the Federal Tax Certificate, to which this
certificate is attached, are true.
4.The Bidding Agent has acted on behalf of the Authority in
receiving bids for the purchase by the Authority of acquisition of United States
Treasury Obligations (the "Securities"). The Bidding Agent has made a bona fide
solicitation for the Securities, a copy of which is attached to this certificate as
Exhibit B-1, which satisfies all of the following requirements:
(a) The bid specifications attached hereto were timely forwarded to
potential providers of the Securities.
(b)The bid specifications attached hereto include all material terms of
the bid. A term is material if it may directly or indirectly affect the
yield or the cost of the Securities.
(c)The bid specifications attached hereto include a statement notifying
potential providers of the Securities that submission of a bid is a
representation (i) that the potential provider did not consult with
any other potential provider about its bid, (ii) that the bid was
determined without regard to any other formal or informal
agreement that the potential provider has with the Authority or
any other person, and (iii) that the bid is not being submitted solely
as a courtesy to the Authority or any other person for purposes of
satisfying the requirements of Section 1.148-5(d)(6)(iii)(B)(l) or (2) of
the Regulations. -
(d)The terms of the bid specifications attached hereto are
commercially reasonable. A term is commercially reasonable if
there is a legitimate business purpose for the term other than to
increase the purchase price or reduce the yield of the Securities.
For example, the hold-firm period must be no longer than the
Authority reasonably requires.
(e)All potential providers of the Securities had an equal opportunity
to bid. For example, no potential provider was given the
opportunity to review other bids (i.e., a last look) before providing
a bid.
(f)At least three reasonably competitive providers were solicited for
bids with respect the Securities. A reasonably competitive provider
is a provider that has an established industry reputation as a
competitive provider of the type of investments being purchased.
(g)The Bidding Agent did not bid to provide the Securities.
5. The Bidding Agent received the bids to provide the Securities as attached
hereto. Specifically,
(a) The Bidding Agent received at least three bids with respect to the
Securities from providers that the Bidding Agent solicited under a
bona fide solicitation meeting the requirements of paragraph 4
above and that, to the best of the knowledge of the undersigned,
did not have a material financial interest in the Authority's bonds.
A lead underwriter in a negotiated underwriting transaction is
deemed to have a material financial interest in the issue until 15
B-2
days after the issue date of the issue. Any entity acting as a
financial advisor with respect to the purchase of the Securities at
the time the bid specifications were forwarded to potential
providers has a material financial interest in the issue. A provider
that is a related party to a provider that has a material financial
interest in the issue is deemed to have a material financial interest
in the issue.
(b) At least one of the three bids with respect to the Securities
described in paragraph 5(a) above is from a reasonably competitive
provider, within the meaning of paragraph 4(f) above.
6. The Bidding Agent further certifies with respect to the Securities:
(a)The winning bid is the lowest cost bona fide bid for the Securities.
The lowest cost bid is either the lowest cost bid for the portfolio or,
if the Authority compares the bids on an investment by investment
basis, the aggregate cost of a portfolio comprised of the lowest cost
bid for each investment.
(b)The provider of the Securities certified the administrative costs that
it paid (or expected to pay, if any) to third parties in connection
with supplying the Securities.
(c)The Bidding Agent has provided to the Authority (1) the receipt or
other record of the amount actually paid by the Authority for the
Securities, including a record of any administrative costs paid by
the Authority, and the certification under paragraph 5(b) above;
(2) for each bid that is submitted, the name of the person and entity
submitting the bid, the time and date of the bid, and the bid results;
and (3) the bid solicitation form and, if the terms of the purchase
deviated from the bid solicitation form or a submitted bid is
modified, a brief statement explaining the deviation and stating the
purpose for the deviation.
7. The Bidding Agent has received a fee in the amount of $37,000 as
compensation for serving as Bidding Agent. The aggregate fee is comparable to a fee
that would be charged for reasonably comparable investments if acquired with a source
of funds other than gross proceeds of tax-exempt obligations and that such aggregate
fee does not exceed the lesser of (A) $37,000 and (B) 0.20% of the computational base. In
the event that 0.20% of the computational base is less than $3,000.00, the minimum fee
will be $3,000.00. The computational base is defined as per Section 1.148-
5(e)(2)(iii)(B)(2) of the Regulations.
B-3
The Financial Advisor hereby authorizes the Authority to rely on the statements made
herein in connection with making the representations set forth in the Federal Tax
Certificate to which this certificate is attached and in its efforts to comply with the
conditions imposed by the Code on the exclusion of interest on the Bonds from the
gross income of their owners. The Financial Advisor hereby authorizes Allen Boone
Humphries Robinson LLP and Andrews Kurth LLP to rely on this certificate for
purposes of its opinion regarding the treatment of interest on the Bonds as excludable
from gross income for federal income tax purposes. Capitalized terms used herein and
not otherwise defined have the meaning ascribed to such terms in the Federal Tax
Certificate to which this certificate is attached.
BOSC, INC.
By:
Name: ^A YL3 D 7/1 71
Title: 11(/6 ^^l jj - — i --
Date: May 22, 2012
B-5
E^M1 - &-
BOSC, Inc.
A subsidiary of BOK Financial Corp.
Date: April 24, 2012
To: Escrow Security Providers
From: John Robuck (713-289-5897)
BOSC, Inc.
RE: Invitation to Offer Escrow Securities
$56,815,000,000*
DEVELOPMENT AUTHORITY OF PEARLAND (THE "AUTHORITY")
(A NON-PROFIT GOVERNMENT CORPORATION ACTING ON BEHALF OF THE CITY OF PEARLAND, TEXAS)
TAX INCREMENT CONTRACT REVENUE REFUNDING BONDS, SERIES 2012 (THE "BONDS")
Offer Submittal: By or about 11:00 AM EASTERN Time on April 30, 2012 to BOSC, Inc.,
Attention: John Robuck 713-289-5897. Notification to each responding provider
of securities (an "Offeror") is anticipated as soon as practicable after facsimile
receipt of the attached competitive offering form. Written offerings are
required and should be sent via fax to 713-354-0257 (see attached "EXHIBIT
C — Escrow Securities Competitive Offering Form").
Bid Objective: The Authority is issuing a portion of the above referenced Bonds to provide for
the refunding of all or a portion of the Authority's currently outstanding debt.
BOSC, Inc. (the "Bidding Agent"), on behalf of the Authority, is soliciting eligible
providers to offer to sell securities for the funding / satisfaction of the Escrow
Requirements detailed below. The Escrow Requirements must be funded by the
winning Offeror (the "Provider") with Eligible Securities, as further described
below. The Eligible Securities provided by the Provider (the "Escrow Securities")
must provide cash flow sufficient to satisfy the Escrow Requirements. The
Provider will be obligated to deliver the Escrow Securities on the Settlement
Date.
Eligible Securities: 1.) Direct, non-callable U.S. Treasury Obligations, or obligations which are fully
and unconditionally guaranteed by the U.S. Government, which shall not
contain provisions permitting the prepayment or redemption thereof, and
shall not include participation interests in such obligations, such as custodial
receipts or shares in mutual funds or unit investment trusts.
2.) Non-callable obligations of agencies or instrumentalities of the U.S.
Government that are rated as to investment quality "AAA" or its equivalent
by a nationally recognized rating agency.
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FIND/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Invitation to Offer Escrow Securities
Development Authority of Pearland
® Tax Increment Contract Revenue Refunding Bonds, Series 2012
A subsidiary of BOK Financial Corp.
Page 2 of 7
Escrow Requirements: See attached "EXHIBIT A — Escrow Requirements."
Settlement Date: Settlement date for the purchase of the Escrow Securities will be on March 22,
2012.
Identifying Escrow: By 12:00 Noon Eastern on April 30, 2012, the Provider must detail the securities
which will be delivered on the Settlement Date. The portfolio details and
duplicate trade confirmations shall be provided to the Bidding Agent, the Escrow
Agent and the Verification Agent.
Escrow Agent: Wells Fargo Bank, N.A.
Verification Agent: Grant Thornton LLP
Delivery: By submitting an offer, the Provider guarantees delivery of the Escrow Securities
to the Escrow Agent on or before 11:00 AM Eastern time on the Settlement
Date. In the event of notification by the Escrow Agent of a failed security
delivery, the Provider will be required to immediately deliver cash to satisfy the
Escrow Requirements.
Basis of Award: In accordance with Treasury Regulations, it is anticipated that the Escrow
Securities will be purchased by the Authority from the Provider offering the
lowest cost portfolio of Eligible Securities that produces cash flow sufficient to
satisfy the Escrow Requirements, provided that the cost of the portfolio of
Eligible Securities does not exceed the cost of the most efficient SLGS portfolio
available on April 30, 2012.
Provider Non -Performance: In the event of non-performance on the part of the Provider, the Provider hereby
acknowledges and affirms that the Provider shall be liable to the Escrow Agent,
on behalf of the Authority, for any and all actual and incidental damages.
Contingency: Although the Authority is expected to close on the Settlement Date, neither the
Authority nor any other member of the financing team will have any liability
whatsoever for any loss resulting from a delay of the closing of the Bonds or a
failure to close. The Provider recognizes that the Escrow Agent will not purchase
the Escrow Securities if the Bonds do not close.
Disclosures: This Invitation to Offer Escrow Securities and the submission of an offer to
provide securities by any party does not obligate the Authority in any manner
whatsoever.
The Provider shall sign a certificate substantially the same as the attached
"EXHIBIT B — Certificate of Securities Provider" attached hereto.
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINR.=1/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
A : Invitation to Offer Escrow Securities
" '
•
Development Authority of Pearland
t Tax Increment Contract Revenue Refunding Bonds, Series 2012
•
A subsidiary of BOK Financial Corp.
Page 3 of 7
The Authority reserves the right to amend, modify or withdraw this Invitation to
Offer Escrow Securities; to waive or revise any requirement of this Invitation to
Offer Escrow Securities; to acquire any supplemental information from any
responding party; to reject any offers submitted hereto in order to obtain a higher
yielding offer than those previously submitted; to accept or reject any or all offers;
to negotiate or hold discussion with any responding party in the preparation of its
offer.
The Bidding Agent makes no representations or warranties as to the ability of the
Authority or any other party to the financing to meet their respective obligations.
The information provided herein has been furnished solely by the Authority;
BOSC, Inc. does not guarantee its accuracy or completeness.
Any Offeror submitting an offer acknowledges and certifies the following: (a) the
submission of an offer is a representation that the Offeror did not consult with
any other Offeror about its offer; (b) the offer was determined without regard to
any other formal or informal agreement that the Offeror has with the Authority
or any other person (whether or not in connection with the Bond issue); (c) the
offer is not being submitted solely as a courtesy to the Authority or any other
person for purposes of satisfying the requirements of Treasury Regulations
Section 1.148-5(d)(6)(iii)(B)(1) or (2), including the requirement of obtaining at
least three bids; (d) the terms of the offer specifications are commercially
reasonable in accordance with Treasury Regulations; and (e) the Offeror did not
have the opportunity to review other offers (i.e. last look) before providing an
offer.
Fee: A brokerage fee of $37,000 will be paid to BOSC, Inc. by the Provider within two
business days of the Settlement Date.
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
I'INRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Invitation to Offer Escrow Securities
BOS
Development Authority of Pearland
e Tax Increment Contract Revenue Refunding Bonds, Series 2012
Page 4 of 7 A subsidiary of 80K. Financial Corp.
$56,815,000*
DEVELOPMENT AUTHORITY OF PEARLAND
(A non-profit local government corporation action on behalf of the City of Pearland, Texas)
TAX INCREMENT CONTRACT REVENUE REFUNDING BONDS, SERIES 2012
Date
Estimated
Re uirements*
09/01/2012 $16,980,178.78
03/01/2013 803,058.77
09/01/2013 2,278,058.77
03/01/2014 772,251.27
09/01/2014 11,792,251.27
03/01/2015 493,455.01
09/01/2015 7,548,455.01
03/01/2016 333,015.63
09/01/2016 7,668,015.63
03/01/2017 177,153.75
09/01/2017 562,153.75
03/01/2018 168,250.63
09/01/2018 6,298,250.63
Total 55,874,548.90
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Invitation to Offer Escrow Securities
BOSC Development Authority of Pearland Inc. Tax Increment Contract Revenue Refunding Bonds, Series 2012
OA subsidiary of B0K Financial Corp.
Page 5 of 7
To: Development Authority of Pearland
3519 Liberty Drive
Pearland, Texas 77581
RE: Development Authority of Pearland
Tax Increment Contract Revenue Refunding Bonds, Series 2012
CERTIFICATE OF SECURITIES PROVIDER
(the "Securities Provider") is the provider of certain United States Treasury
Obligations (the "Securities") purchased in connection with the issuance of the Development Authority of Pearland, Texas (the
"Issuer") Tax Increment Contract Revenue Refunding Bonds, Series 2012 (the "Bonds"). Capitalized terms used herein and not
otherwise defined have the meaning given to such terms in the No-Arbitrage Certificate to which this certificate is attached. I, the
undersigned, hereby certify as follows on behalf of the Securities Provider:
1.I am the duly chosen, qualified and acting officer of the Securities Provider for the office shown below my
signature; as such, I am familiar with the facts herein certified and I am duly authorized to execute and deliver this certificate on
behalf of the Securities Provider. I am the officer of the Securities Provider charged, along with other officers of the Securities
Provider, with responsibility for the transactions described herein.
2.As of the date on which the Securities Provider's bid was made and accepted, the cost of the Securities
(determined net of broker's fees, if any) was not greater than the cost of reasonably comparable investments, if any, offered by the
Securities Provider to other persons involving the investment of a source of funds other than gross proceeds of an issue of tax-
exempt bonds. A copy of the bid submitted by the Securities Provider is attached hereto.
3.The bid submitted by the Securities Provider was (i) determined without consultation with another potential
provider, (ii) determined without regard to any other formal or informal agreement with the Issuer or any other person (whether
or not in connection with the issuance of the Bonds), and (iii) not submitted solely as a courtesy to the Issuer or any other person
for purposes of satisfying the requirements of Section 1.148-5(d)(6)(iii)(B)(1) or (2) of the Regulations, including the requirement
of obtaining at least three bids.
4.The Securities Provider (i) is regularly engaged in providing investments of the type purchased, and (ii) is a
reasonably competitive provider of investments of the type purchased.
5.In connection with the Securities, a fee of $37,000 will be paid by the Securities Provider to BOSC, Inc. [and a
fee of $_____________ will be paid by the Securities Provider to ]. No other
administrative costs will be, or are expected to be, paid by the Securities Provider in connection with the Securities. For purposes
of the preceding sentence, "administrative costs" include any brokerage commission paid with respect to the Securities (including
any interest payments on the Securities retained by a broker) and any costs paid by or on behalf of the Issuer for brokerage or
selling commissions, legal and accounting fees, investment advisory fees, recordkeeping, safekeeping, custody and similar costs
and expenses.
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated.
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Invitation to Offer Escrow Securities BS Development Authority of Pearland Inc. Tax Increment Contract Revenue Refunding Bonds, Series 2012
Page 6 of 7
A subsidiary of 80K Financial Corp.
6. Neither the Securities Provider nor any person related thereto has any material financial interest in the Bonds.
Neither the Securities Provider nor any person related thereto acted as lead underwriter in connection with the Bonds, nor as
financial advisor in connection with the Securities or bidding thereon. The Securities Provider did not participate in the
structuring of the Bond transaction, including without limitation, the determination of the amount of bonds to be refunded, the
size of the refunding escrow, or the manner in which the escrow is to be invested.
The Issuer is hereby authorized to rely on the statements made herein in connection with making the representations set
forth in the No-Arbitrage Certificate to which this certificate is attached and in its efforts to comply with the conditions imposed
by the Code on the exclusion of interest on the Bonds from the gross income of their owners. Allen Boone Humphries
Robinson LLP is hereby authorized to rely on this certificate for purposes of their opinion regarding the treatment of interest on
the Bonds as excludable from gross income for federal income tax purposes.
EXECUTED on this day of , 2012.
By:.
N
Schedule A
Description Maturity Purchase Price
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Invitation to Offer Escrow Securities
Development Authority of Pearland
X . ® Tax Increment Contract Revenue Refunding Bonds, Series 2012
Page 7 of 7 A subsidiary of 80K. Financial Corp.
$56,815,000*
DEVELOPMENT AUTHORITY OF PEARLAND
(A non-profit local government corporation action on behalf of the City of Pearland, Texas)
TAX INCREMENT CONTRACT REVENUE REFUNDING BONDS, SERIES 2012
ESCROW SECURITIES COMPETITIVE OFFERING FORM
Offers are due telephonically on April 30, 2012 by or about 11:00 AM EASTERN Time to John Robuck at 713-289-5897 with facsimile
confirmation immediately thereafter to 713-354-0257. Award is subject to market change and expected as soon as practicable after
facsimile receipt of this offering form.
Cost to the Authority to satisfy the Escrow Requirements outlined in the "Invitation to Offer Escrow Securities" for settlement on
March 22, 2012:
Final Maturity Value:(If applicable)
Principal Cost:$
Accrued:$ (If applicable)
Total Securities Cost:$
Cash Deposit:$__________________________ (If applicable)
Total Escrow Cost:$
Provider:
Contact:
Phone:
The offers submitted conform to the specifications set forth in the attached "Invitation to Offer Escrow Securities" dated April 24, 2012
the Authority reserves the right to reject any and all offers, to waive irregularities, and to change the time that offers are due. Providers
agree to hold the Authority and its consultants and agents harmless in the submission of an offer. The Providers are responsible for any
and all costs associated with the submission of an offer. By submitting this offer form, the eligible Provider acknowledges the following:
(a) the potential Provider did not consult with any other potential Provider about its offer; (b) the offer was determined without regard
to any other formal or informal agreement that the potential Provider has with the Authority or any other person (whether or not in
connection with the Bond issue); (c) the offer is not being submitted solely as a courtesy to the Authority or any other person for
purposes of satisfying the requirements of obtaining at least three offers; (d) the terms of the offer specifications are commercially
reasonable in accordance with Treasury Regulations; and (e) the potential Provider did not have the opportunity to review other offers
(i.e. last look) before providing a offer. The Provider's offer, however, is subject to the following conditions if left blank, it is assumed
that there are no conditions to the offer):
Signed: Dated:
Title:
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Invitation to Offer Escrow Securities
BOAC,Development Authority
Bonds, Series
ies 2 12 I nc.j Tax Increment Contract Revenue Refunding Bonds Series 2012
A subsidiary of BOK Financial Corp.
Page7of7
EXHIBIT C — Escrow Securities Competitive Offering Form
$56,815,000*
DEVELOPMENT AUTHORITY OF PEARLAND
(A non-profit local government corporation action on behalf of the City of Pearland, Texas)
TAX INCREMENT CONTRACT REVENUE REFUNDING BONDS, SERIES 2012
ESCROW SECURITIES COMPETITIVE OFFERING FORM
Offers are due telephonically on April 30, 2012 by or about 11:00 AM EASTERN Time to John Robuck at 713-289-5897 with facsimile
confirmation immediately thereafter to 713-354-0257. Award is subject to market change and expected as soon as practicable after
facsimile receipt of this offering form.
Cost to the Authority to satisfy the Escrow Requirements outlined in the "Invitation to Offer Escrow Securities" for settlement on
March 22, 2012:
Final Maturity Value: (If applicable)
Principal Cost: $
Accrued:. $ (If applicable)
Total Securities Cost: $_y 'O
Cash Deposit: $
''JJ
(If applicable)
Total Escrow Cost:$ T e' 6. 211
)
Provider: e. P G "_^A/ G G
Contact:
Phone: /i — S3 ' 026
The offers submitted conform to the specifications set forth in the attached "Invitation to Offer Escrow Securities" dated April 25, 2012
the Authority reserves the right to reject any and all offers, to waive irregularities, and to change the time that offers are due, Providers
agree to hold the Authority and its consultants and agents harmless in the submission of an offer. The Providers are responsible for any
and all costs associated with the submission of an offer. By submitting this offer form, the eligible Provider acknowledges the following:
(a) the potential Provider did not consult with any other potential Provider about its offer; (b) the offer was determined without regard
to any other formal or informal agreement that the potential Provider has with the Authority or any other person (whether or not in
connection with the Bond issue); (c) the offer is not being submitted solely as a courtesy to the Authority or any other person for
purposes of satisfying the requirements of obtaining at least three offers; (d) the terms of the offer specifications are commercially
reasonable in accordance with Treasury Regulations; and (e) the potential Provider did not have the opportunity to review other offers
(i.e. last look) before providing a offer. The Provider's offer, however, is subject to the following conditions (if left blank, it is assumed
that there are no conditions to the offer):
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Page 1 of 1
From: Gilbert, Ethan [ethan.gilbert@baml.com ]
Sent: Monday, April 30, 2012 10:00 AM
To: Robuck, John
Subject: RE: REVISED Invitation to Offer Escrow Securities to the Development Authority of Pearland
For the Pearland deal with total draws 55,874,548.90, a final draw date of 9/1/2018 and a settlement date of 5/22/2012 we will charge: 54,803,654.52
Please let me know if there are any questions,
Ethan
From: Robuck, John [mailto:JRobuck@boscinc.com]
Sent: Thursday, April 26, 2012 10:48 AM
To: Robuck, John
Cc: O'Hara, Ryan
Subject: REVISED Invitation to Offer Escrow Securities to the Development Authority of Pearland
Please find attached a revised invitation to offer escrow securities for the Development Authority of Pearland, Texas. The settlement date for the securities is May 22,
2012.
Bids are due by or about 11:00 AM EASTERN Time on April 30 2012 to BOSC, Inc., Attention: John Robuck 713-289-5897.
Notification to each responding provider of securities (an "Offeror") is anticipated as soon as practicable after facsimile receipt of the attached competitive offering form.
Written offerings are required and should be sent via fax to 713-354-0257 (see attached "EXHIBIT C — Escrow Securities Competitive Offering Form").
Should any questions arise or additional information be needed, please contact me at 713-289-5897.
John H. Robuck
Investment Banker
BOSC, Inc. (an affiliate of Bank of Texas)
Texas Public Finance
5 Houston Center
1401 McKinney Street, Suite 1650
Houston, Texas 77010
Phone: (713) 289-5897
Fax: (713) 354-0257
Mobile: (281) 610-8335
Email: irobuckta boscinc.conr
BOSC, Inc. A subsidiary of BOK Financial Corporation. An affiliate of BOKF, NA dba Bank of Albuquerque, Bank of Arkansas, Bank of Arizona, B
BOSC, Inc does not accept orders by electronic mail.
This message w/attachments (message) is intended solely for the use of the intended recipient(s) and may contain information that is privileged, confidential or proprietary. If
you are not an intended recipient, please notify the sender, and then please delete and destroy all copies and attachments, and be advised that any review or dissemination of,
or the taking of any action in reliance on, the information contained in or attached to this message is prohibited.
Unless specifically indicated, this message is not an offer to sell or a solicitation of any investment products or other financial product or service, an official confirmation of
any transaction, or an official statement of Sender. Subject to applicable law, Sender may intercept, monitor, review and retain e-communications (EC) traveling through its
networks/systems and may produce any such EC to regulators, law enforcement, in litigation and as required by law.
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References to "Sender" are references to any subsidiary of Bank of America Corporation. Securities and Insurance Products: * Are Not FDIC Insured * Are Not Bank
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Attachments that are part of this EC may have additional important disclosures and disclaimers, which you should read. This message is subject to terms available at the
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http://www.bankofamerica.com/emaildisclaimer . By messaging with Sender you consent to the foregoing.
file://C:\Users\smoore\AppData\Local\Microsoft\Windows\Temporary Internet Files\Cont... 5/21/2012
From:BB&T CM Fixed Income 804 6447682 04/30/2012 11:07 #284 P.002/002
Invitation to Offer Escrow Securities
B ^aC f
Inc.
Develop and n g Bonds , S e ies 2012
Tax Increment Contract Revenue Refunding Bonds, Series 2022
Page 7of7 A subsidiary of 80K Financial Corp.
EXHIBIT C --- Escrow Securities Competitive Offering Form
$56,815,000*
DEVELOPMENT AUTHORITY OF PEARLAND
(A non-profit local government corporation action on behalf of the City of Pearland, Texas)
TAX INCREMENT CONTRACT REVENUE REFUNDING BONDS, SERIES 2012
ESCROW SECURITIES COMPETITIVE OFFERING FORM
Offers are due telephonically on April 30, 2012 by or about 11:00 AM EASTERN Time to John Robuck at 713-289-5897 with facsimile
confirmation immediately thereafter to 713-354-0257. Award is subject to market change and expected as soon as practicable after
facsimile receipt of this offering form.
Cost to the Authority to satisfy the Escrow Requirements outlined in the "Invitation to Offer Escrow Securities" for settlement on
March 22, 2012:
Final Maturity Value: (If applicable)
Principal Cost:
Accrued: $ (If applicable)
Total Securities Cost:
Cash Deposit: $________________________ (If applicable)
Total Escrow Cost:$
Provider: /_/,—,7's-
Contact: U`^/j
j
^^ / //
Phone: L< [ v 9/'
The offers submitted conform to the specifications set forth in the attached "Invitation to Offer Escrow Securities" dated April 25, 2012
the Authority reserves the right to reject any and all offers, to waive irregularities, and to change the time that offers are due. Providers
agree to hold the Authority and its consultants and agents harmless in the submission of an offer. The Providers are responsible for any
and all costs associated with the submission of an offer. By submitting this offer form, the eligible Provider acknowledges the following:
(a) the potential Provider did not consult with any other potential Provider about its offer; (b) the offer was determined without regard
to any other formal or informal agreement that the potential Provider has with the Authority or any other person (whether or not in
connection with the Bond issue); (c) the offer is not being submitted solely as a courtesy to the Authority or any other person for
purposes of satisfying the requirements of obtaining at least three offers; (d) the terms of the offer specifications are commercially
reasonable in accordance with Treasury Regulations; and (e) the potential Provider did not have the opportunity to review other offers
(i.e. last look) before providing a offer. The Provider's offer, however, is subject to the following conditions (if left blank, it is assumed
that there are no conditions to the offer):
Title: v
* Preliminary, subject to change before the Settlement Date.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
EXHIBIT C
CERTIFICATE OF OPEN MARKET SECURITIES PROVIDER
APR 30 2012 12:02 PM FR CANTOR FITZGERRLD12 829 5420 TO 917133540257 P.01/01
0
Invitation to Offer Escrow Securities
: 0 , Inc.
DevelopmentnuRcfun Authority iea2012
Tax Increment Contract Re venue I2cfundiri Bonds, Series 2012
A subsidiary of SOK Financial Corp.
Page 7 of 7
EXHIBIT C - Escrow Securities Competitive Offering Form
$56,x15,000*
DEVELOPMENT AUTHORITY OF PEARLAND
(A non-profit local governm,cnt corporation action on behalf of the City of Pearl.3 sd, Texas)
TAX INCREMENT CONTRACT REVENUE Ill~ E LADING BONDS, SERIES 2012
ESCROW SECURITIES COMPETITIVE OFFERING FORM
Offers are due telephonically on April 30, 2012 by or about 11:00 AM EASTERN Time to john Robuck at 713-289-5$97 with facsimile
confirmation immediately thereafter to 713-354-0257. Award is subject to market change and expected as soon as practicable after
facsimile receipt of this offering form.
Cost to the Authority to satisfy the li.scrow Requirements outlined in the "Invitation to Offer Escrow Securities" for settlement on May
22,2012:
Final Maturity Value: (If applicable)
Principal Cost; $_
Accrued: $ --- (If applicable)
Total Securities Cost: $
Cash Deposit: $ (If applicable)-
Total Escrow Cost:$ o. pe [
Providcr: Al //j
Contact-, __ t gC
C
/
J
Phone: 2f2_ r L] — YI 3
The offers submitted conform to the specifications set forth in the attached "Invitation to Offer Escrow Securities" dated April 25, 2012
the Authority reserves the right to reject any and all offers; to waive irregularities, and to change the time that offers are due. Providers
agree to hold the Authority and its consultants and agents harmless in the submission of an offer-'I'hc Providers are responsible for any
and all costs associated with the submission of an offer. By submitting this offer form, the eligible Provider acknowledges the following:
(a) the potential Provider did not consult with any other potential Providcr about its offer; (b) the offer was determined without regard
to any other formal or informal agreement that the potential Providcr has with the Authority or any other person (whether or not in
connection with the Bond issue); (c) the offer is not being submitted solely as a courtesy to the Authority or any other person for
purposes of satisfying the requirements of obtaining at least three offers; (d) the terms of the offer specifications are commercially
reasonable in accordance with Treasury Regulations; and (e) the potential Provider did not have the opportunity to review other offers
(i.e. last look) before providing a offer. The Provider's offer, however, is subject to the following conditions (if left blank, it is assumed
that there are no conditions to the offer):
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I
^.... . . . • +c. .,a:•<,,ce.l by. a i.Y .>.a l k ii.r .,,,,.it:.....k ............... .--... i ... , nH Tar' 1LLC 1<>nn<>!'...,C:1,S1...,.•>u..........t.l.
** TC)TAI PAGF . Pi l **
Form 8038-G I Information Return for Tax-Exempt Governmental Obligations
► Under Internal Revenue Code section 149(e) (Rev. September 2011) OMB No. 1545-0720
- See separate instructions. Department of the Treasury I Caution: If the issue price is under $100, 000, use Form 8038-GC. Internal Revenue Service
ITitI Reporting Authority If Amended Return, check here ► q
1 Issuer's name 2 Issuer's employer identification number (EIN)
Development Authority of Pearland 20-1677972
3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instructions)3b Telephone number of other person shown on 3a
4 Number and street (or P.O. box if mail is not delivered to street address)Room/suite 5 Report number (For IRS Use Only)
3919 Liberty Drive 3
6 City, town, or post office, state, and ZIP code 7 Date of issue
Pearland, Texas 77581 May 22, 2012
8 Name of issue 9 CUSIP number
Tax Increment Contract Revenue and Refunding Bonds, Series 2012 NIA
10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see 10b Telephone number of officer or other
instructions)employee shown on 1Oa
Bill Eisen, City Manager 281 -652-1663
Type of Issue (enter the issue price). See the instructions and attach schedule.
11 Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
12 Health and hospital . . . . . . . . . . . . . . . . . . . . . . . . . .
13 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14 Public safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
15 Environment (including sewage bonds) . . . . . . . . . . . . . . . . . . . .
16 Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
17 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
18 Other. Describe ► Streets, sidewalks, utilities, parks
19 If obligations are TANS or RANs, check only box 19a . . . . . . . . . . . . . ► q
If obligations are BANS, check only box 19b . . . . . . . . . . . . . . . . ► q
20 If obligations are in the form of a lease or installment sale, check box . . . . . . . . ► q
11
12
13
14
15
16
17
18 56,915,000 00
ITIIllI Description of Obligations. Complete for the entire issue for which this form is being filed.
(a) Final maturity date (b) Issue price (c) Stated redemption
price at maturity
(d) Weighted
average maturity (e) Yield
21 9/1/2029 56,915,000.00 56,915,000.00 9.221 years VR %
Uses of Proceeds of Bond Issue (including underwriters' discount)
22 Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . .
23 Issue price of entire issue (enter amount from line 21, column (b)) . . . . .
24 Proceeds used for bond issuance costs (including underwriters' discount) . . 24 289,500 00
25 Proceeds used for credit enhancement . . . . . . . . . . . . 25 0 00
26 Proceeds allocated to reasonably required reserve or replacement fund . 26 0 00
27 Proceeds used to currently refund prior issues . . . . . . . . . 27 0 00
28 Proceeds used to advance refund prior issues . . . . . . . . . 28 53,372,400 24
29 Total (add lines 24 through 28) . . . .
30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here)
22 0 00
23 56,915,000 00
.
29 53,661,900 24
30 3,253,099 76
Description of Refunded Bonds. Complete this part only for refunding bonds.
31 Enter the remaining weighted average maturity of the bonds to be currently refunded . . . . ► years
32 Enter the remaining weighted average maturity of the bonds to be advance refunded . . . . ► 9.8865 years
33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) . . . . . . ► 9/1/2018
34 Enter the date(s) the refunded bonds were issued ► (MM/DD/YYYY) 12/15/2004;11/22/2005;10/27/2006;10125/2007; 6/2312009
For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 63773S Form 8038 -G (Rev. 9-2011)
Form 8038-G (Rev. 9-2011)Page 2
Miscellaneous
35 Enter the amount of the state volume cap allocated to the issue under section 141 (b)(5) . . . . 35 0 00
36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract
(GIC) (see instructions) . . . . . . . . . . . . . . . . . . . . . . . 36a 0 00
b Enter the final maturity date of the GIC ►
c Enter the name of the GIC provider 0-
37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans
to other governmental units . . . . . . . . . . . . . . . . . . . . . . . . 37 o 00
38a If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► q and enter the following information:
b Enter the date of the master pool obligation ►
c Enter the EIN of the issuer of the master pool obligation ►
d Enter the name of the issuer of the master pool obligation ►
39 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box . . .. ► q
40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . . . . . . . . .. ► q
41a If the issuer has identified a hedge, check here ► q and enter the following information:
b Name of hedge provider 0-
c Type of hedge ►
d Term of hedge ►
42 If the issuer has superintegrated the hedge, check box . . . . . . . . . . . . . . . . . . . .. ► q
43 If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated
according to the requirements under the Code and Regulations (see instructions), check box . . . . . . .. ► q
44 If the issuer has established written procedures to monitor the requirements of section 148, check box . . . .. ► q
45a If some portion of the proceeds was used to reimburse expenditures, check here ► q and enter the amount
of reimbursement . . . . . . . . . ►
b Enter the date the official intent was adopted ►
Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge
Signature and belief, they are true, corc , complete. I further declare that I consent to the IRS's disclosure of the issuer's return information, as necessary to
and process this ret n, to the pe on tha I have
r
authorized above.
Consent cC, 6IZZ Z Tom Reid, Chair
Signature of issuer's authorized representative Date y Type or print name and title
Paid Print/Type preparer's name Preparer's signature Date
5/2 2/1 2-. Check q if IPTIN
Preparer Tina M. Kyle self-employed P01066476
Use Only Firm's name ► Allen Boone Humphries Robinson LLP Firm's EIN ► 74-3091731
Firm's address ► 3200 Southwest Fwy, Ste 2600, Houston, TX 77027 I Phone no. 713 -860-6400
Form 8038-G (Rev. 9-2011)
PAYING AGENT/REGISTRAR AGREEMENT
THIS PAYING AGENT/REGISTRAR AGREEMENT dated as of April 30, 2012
(together with any amendments or supplements hereto, the "Agreement") is entered into by and
between the DEVELOPMENT AUTHORITY OF PEARLAND (the "Issuer"), and REGIONS
BANK, as paying agent/registrar (together with any successor in such capacity, the "Bank").
WITNESSETH:
WHEREAS, the Issuer has duly authorized and provided for the issuance of its
Development Authority of Pearland Tax Increment Contract Revenue and Refunding Bonds,
Series 2012 (the "Bonds") to be issued as fully registered bonds.
WHEREAS, all things necessary to make the Bonds the valid obligations of the Issuer, in
accordance with their terms, will be done upon the issuance and delivery thereof;
WHEREAS, the Issuer and the Bank wish to provide the terms under which the Bank will
act as Paying Agent to pay the principal of, redemption premium, if any, and interest on the
Bonds, in accordance with the terms thereof, and under which the Bank will act as Registrar for
the Bonds; and
WHEREAS, the Issuer and the Bank have duly authorized the execution and delivery of
this Agreement; and all things necessary to make this Agreement the valid agreement of the
parties, in accordance with its terms, have been done.
NOW, THEREFORE, it is mutually agreed as follows:
ARTICLE I.
APPOINTMENT OF BANK AS
PAYING AGENT AND REGISTRAR
Section 1.1. Appointment.
The Issuer hereby appoints the Bank to act as Paying Agent with respect to the Bonds, to
pay to the Registered Owners of the Bonds, in accordance with the terms and provisions of this
Agreement and the resolution authorizing the issuance of the Bonds (the "Resolution"), the
principal of, redemption premium, if any, and interest on all or any of the Bonds.
The Issuer hereby appoints the Bank as Registrar with respect to the Bonds.
The Bank hereby accepts its appointment, and agrees to act as Paying Agent and
Registrar with respect to the Bonds.
Section 1.2. Compensation.
As compensation for the Bank's services as Paying Agent/Registrar, the Issuer hereby
agrees to pay the Bank the fees set forth in the Bank's fee schedule attached as Exhibit A hereto.
HOU:3213762.3
The Bank reserves the right to amend the fee schedule at any time, provided the Bank shall have
furnished the Issuer with a written copy of such amended fee schedule at least 75 days prior to
the date that the new fees are to become effective.
In addition, the Issuer agrees to reimburse the Bank upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Bank in accordance with any of
the provisions hereof (including the reasonable compensation and the expenses and
disbursements of its agents and counsel).
ARTICLE II.
DEFINITIONS
Section 2.1. Definitions.
For all purposes of this Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
"Bank" means Regions Bank, a commercial bank duly organized and existing under the
laws of the United States of America.
"Bond" or "Bonds" means any one or all of the "Development Authority of Pearland Tax
Increment Contract Revenue and Refunding Bonds, Series 2012" authorized by the Resolution.
"Financial Advisor" means BOSC, Inc. and it's successors.
"Issuer" means the Development Authority of Pearland.
"Resolution" means the resolution of the Issuer authorizing the issuance of the Bonds.
"Paying Agent" means Regions Bank when it is performing the functions of paying agent
under this Agreement.
"Person" means any individual, corporation, partnership, joint venture, association, joint
stock company, trust, unincorporated organization or government or any agency or political
subdivision of a government or any entity whatsoever.
"Registrar" means the Bank when it is performing the function of registrar under this
Agreement.
"Registered Owner" means the Person in whose name any Bond is registered in the books
of registration maintained by the Bank under this Agreement.
All other capitalized terms shall have the meanings assigned to them in the Resolution.
2
HOU:3213762.3
ARTICLE III.
DUTIES OF THE BANK
Section 3.1. Initial Delivery of the Bonds.
The Bonds will be initially registered and delivered by the Bank to the purchaser
designated by the Issuer as set forth in the Resolution. If such purchaser delivers a written
request to the Bank not later than five business days prior to the date of initial delivery, the Bank
will, on the date of initial delivery, exchange the Bonds initially delivered for Bonds of
authorized denominations, registered in accordance with the instructions in such request and the
Resolution.
Section 3.2. Duties of Pang Agent.
As Paying Agent and on behalf of the Issuer, the Bank shall, provided adequate funds
have been provided to it for such purpose by or on behalf of the Issuer, timely pay on behalf of
the Issuer the principal of and interest on each Bond in accordance with the provisions of the
Resolution.
If the issue is to be Depository Trust Company (DTC) eligible, the Paying Agent will
comply with all eligibility requirements as outlined and agreed upon in the eligibility
questionnaire.
Section 3.3. Duties of Registrar.
The Bank shall provide for the proper registration of the Bonds and the timely exchange,
replacement and registration of transfer of the Bonds in accordance with the provisions of the
Resolution. Any changes to Registered Owners for such exchange, replacement and registration
shall be made by the Bank only in accordance with the Resolution. The Bank will maintain the
books of registration in accordance with the Resolution and the Bank's general practices and
procedures in effect from time to time.
Section 3.4. Unauthenticated Obligations.
The Issuer shall provide an adequate inventory of unauthenticated Bonds to facilitate
transfers. The Bank covenants that it will maintain such unauthenticated Bonds in safekeeping
and will use reasonable care in maintaining such Bonds in safekeeping, which shall be not less
than the care it maintains for debt securities of other government entities or corporations for
which it serves as registrar, or which it maintains for its own bonds.
Section 3.5. Reports.
Upon request of the Issuer, the Bank will provide the Issuer reports which will describe in
reasonable detail all transactions pertaining to the Bonds and the books of registration for the
period of time specified by the Issuer. The Issuer may also inspect and make copies of the
information in the books of registration and such other documents related to the Bonds and in the
Bank's possession at any time the Bank is customarily open for business, provided that
;3
HOU:3213762.3
reasonable time is allowed the Bank to provide an up-to-date listing or to convert the information
into written form.
The Bank will not release or disclose the content of the books of registration to any
person other than to, or at the written request of, an authorized officer or employee of the Issuer,
except upon receipt of a subpoena, court order or as otherwise required by law. Upon receipt of
a subpoena, court order or other lawful request, the Bank will notify the Issuer immediately so
that the Issuer may contest the subpoena, court order or other request if it so chooses.
Section 3.6. Canceled Obligations. ions.
All Bonds surrendered for payment, redemption, transfer, exchange or replacement, if
surrendered to the Bank, shall be promptly canceled by it and, if surrendered to the Issuer, shall
be delivered to the Bank and, if not already canceled, shall be promptly canceled by the Bank.
The Issuer may at any time deliver to the Bank for cancellation any Bonds previously
authenticated and delivered which the Issuer may have acquired in any manner whatsoever, and
all Bonds so delivered shall be promptly canceled by the Bank. All canceled Bonds held by the
Bank shall be destroyed and evidence of such destruction shall be furnished to the Issuer.
Section 3.7. Reliance on Documents, Etc.
(a)The Bank may conclusively rely, as to the truth of the statements and correctness
of the opinions expressed therein, on certificates or opinions furnished to the Bank by the Issuer.
(b)The Bank shall not be liable to the Issuer for actions taken under this Agreement
as long as it acts in good faith and exercises due diligence, reasonableness and care, as prescribed
by law, with regard to its duties hereunder.
(c)This Agreement is not intended to require the Bank to expend its own funds for
performance of any of its duties hereunder.
(d)The Bank may exercise any of the powers hereunder and perform any duties
hereunder either directly or by or through agents or attorneys.
(e)The Bank may rely and shall be protected by the Issuer against any claim by the
Issuer or any other Person in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note,
security, or other paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties. Without limiting the generality of the foregoing
statement, the Bank need not examine the ownership of any Bond, but is protected in acting upon
receipt of a Bond containing an endorsement or instruction of transfer or power of transfer which
appears on its face to be signed by the holder or an agent of the holder. The Bank shall not be
bound to make any investigation into the acts or matters stated in a resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note,
security or other paper or document supplied by Issuer.
(f)The Bank may consult with legal counsel, and the advice of such counsel or any
opinion shall be full and complete authorization and protection with respect to any action taken,
El
HOU:3213762.3
suffered or omitted by it hereunder in good faith and in reliance thereon; provided that any such
written advice or opinion is supplied to the Issuer by the Bank.
Section 3.8. Money Held by
Money held by the Bank hereunder shall be held in trust for the benefit of the Registered
Owners of the Bonds.
The Bank shall be under no obligation to pay interest on any money received by it
hereunder.
All money deposited with the Bank hereunder shall be secured in the manner and to the
fullest extent required by law for the security of funds of the Issuer.
Any money deposited with the Bank for the payment of the principal of or interest on any
Bonds and remaining unclaimed by the Registered Owner after the expiration of three years from
the date such funds have become due and payable shall be reported and disposed of by the Bank
in accordance with the provisions of Texas law including, to the extent applicable, Title 6 of the
Texas Property Code, as amended. To the extent such provisions of the Property Code do not
apply to the funds, such funds shall be paid by the Bank to the Issuer upon receipt of a written
request therefor from the Issuer. The Bank shall have no liability to the Registered Owners of
the Bonds by virtue of actions taken in compliance with the foregoing provision.
The Bank shall deposit all moneys received from the Issuer into a trust account to be held
in a fiduciary capacity for the payment of the Bonds, with such moneys in the account that
exceed the deposit insurance available by the Federal Deposit Insurance Corporation to be fully
collateralized with securities or obligations that are eligible under the laws of the State of Texas
to secure and be pledged as collateral for trust accounts until the principal and interest on such
Bonds have been presented for payment and paid to the Registered Owners.
Section 3.9. Indemnification. To the extent permitted by law, the Issuer agrees to
indemnify the Bank for, and hold it harmless against, any loss, liability, or expense incurred
without negligence or bad faith on its part, arising out of or in connection with its acceptance or
administration of its duties hereunder, including the cost and expense against any claim or
liability in connection with the exercise or performance of any of its powers or duties under this
Agreement.
Section 3.10. Interpleader. The Authority and the Escrow Agent agree that the Escrow
Agent may seek adjudication of any adverse claim, demands or controversy over its persons as
well as funds on deposit in a court of competent jurisdiction within the State of Texas; waive
personal service of any process; and agree that service of process by certified or registered mail,
return receipt requested, to the address set forth in this Agreement shall constitute adequate
service. The Authority and the Escrow Agent further agree that the Escrow Agent has the right
to file a bill of interpleader in any court of competent jurisdiction within the State of Texas to
determine the rights of any person claiming an interest herein.
W1
HOU:3213762.3
ARTICLE IV
MISCELLANEOUS PROVISIONS
Section 4.1. May Own Bonds.
The Bank, in its individual or any other capacity, may become the owner or pledgee of
Bonds with the same rights it would have if it were not the Paying Agent and Registrar for the
Bonds.
Section 4.2. Amendment.
This Agreement may be amended only by an agreement in writing signed by both of the
parties hereof.
Section 4.3. Assignment.
This Agreement may not be assigned by either party without the prior written consent of
the other.
Section 4.4. Notices.
Any request, demand, authorization, direction, notice, consent, waiver or other document
provided or permitted hereby to be given or furnished to the Issuer or the Bank shall be mailed or
delivered to the Issuer or the Bank, respectively, at the addresses shown herein, or such other
address as may have been given by one party to the other by 15 days' written notice.
Section 4.5. Effect of Headings.
The Article and Section headings herein are for convenience only and shall not affect the
construction hereof.
Section 4.6. Successors and Assigns.
All covenants and agreements herein by the Issuer and the Bank shall bind their
successors and assigns, whether so expressed or not. This Agreement shall not be assigned by
the Bank without the prior written consent of the Issuer.
Section 4.7 Severability.
If any provision of this Agreement shall be invalid or unenforceable, the validity and
enforceability of the remaining provisions hereof shall not in any way be affected or impaired.
Section 4.8. Benefits of Agreement.
Nothing herein, express or implied, shall give to any Person, other than the parties hereto
and their successors hereunder, any benefit or any legal or equitable right, remedy or claim
hereunder.
HOU:3213762.3
Section 4.9. Resolutions Govern Conflicts.
This Agreement and the Resolution constitute the entire agreement between the parties
hereto relative to the Bank acting as Paying Agent and Registrar and if any conflict exists
between this Agreement and the Resolution, the Resolution shall govern. The Bank agrees to be
bound by the terms of the Resolution with respect to, the Bonds.
Section 4.10. Term and Termination.
This Agreement shall be effective from and after its date and will terminate on the date of
final payment by the Bank of principal, redemption premium, if any, and interest of the Bonds.
This Agreement may be terminated for any reason by the Issuer or the Bank at any time upon 60
days' written notice; provided, however, that no such termination shall be effective until a
successor has been appointed and has accepted the duties of the Bank hereunder. In the event of
early termination, regardless of circumstances, the Bank shall deliver to the Issuer or its designee
all funds, Bonds and all books and records pertaining to the Bank's role as Paying Agent and
Registrar with respect to the Bonds, including, but not limited to, the books of registration.
Section 4.11. Merger, Conversion, Consolidation or Succession.
Any corporation into which the Bank may be merged or converted or with which it may
be consolidated, or any corporation resulting from any merger, conversion, or consolidation to
which the Bank shall be a party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Bank shall ipso facto be the successor of the Bank hereunder
without the execution or filing of any paper or any further act on the part of either of the parties
hereto. In case any Bond shall have been registered, but not delivered, by the Bank then in
office, any successor by merger, conversion, or consolidation to such authenticating Bank may
adopt such registration and deliver the. Bonds so registered with the same effect as if such
successor Bank had itself registered the Bonds.
Section 4.12. Bank Not a Trustee.
This Agreement shall not be construed to require the Bank to enforce any remedy which
any Registered Owner may have against the Issuer during any default or event of default under
any agreement between any Registered Owner and the Issuer, including the Bond Order or to act
as trustee for such Registered Owner.
Section 4.13. Counterparts.
This Agreement may be executed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were upon the same
instrument.
Section 4.14. Governing Law.
This Agreement shall be construed in accordance with and shall be governed by the laws
of the State of Texas.
7
HOU:3213762.3
DEVELOPMENT AUTHORITY OF PEARLAND
By:
Chair
ADDRESS: 3519 Liberty Drive
Pearland, Texas 77581
ATTEST:
Secretary
S-1
HOU:3213762. I
REGIONS BANK
By:
Name: R. DOW glas Milner
Title: Vice President
ADDRESS: 1717 St. James Place, Suite 500
Houston, Texas 77056
Attn: Corporate Trust
ATTEST:
B
Title:_! E .P ESDENT
(SEAL)
S-2
HOU:3213762.2
EXHIBIT A
FEE SCHEDULE
HOU:3213762.3
REGIONS
Trustee, Paying Agent, Registrar and Escrow Services for
Development Authority of Pearland
Tax Increment Contract Revenue and Refunding Bonds
Series 2012
Schedule of Fees
Acceptance Fee :....................................$1,000
Annual PAR Fee Option :......................$4,000 Annually in Advance
Annual Escrow Fee Option :..................$3,000
Trustee Counsel :............. .......... $4000 Cap
Fees are payable at the closing of this transaction. Thereafter, fees and any expenses will
be billed on the anniversary date of the closing.
The above-mentioned fees are basic charges and do not include out-of-pocket expenses,
which will be billed in addition to the regular charges as required. Out-of-pocket
expenses shall include, but are not limited to: telephone tolls, stationery, travel and
postage expenses.
Charges for performing extraordinary or other services not contemplated at the time of
the execution of the transaction or not specifically covered elsewhere in this schedule will
be determined by appraisal in amounts commensurate with the service to be provided.
Counsel fees, if ever retained as a result of default or other extraordinary occurrence on
behalf of the bondholders or Regions will be billed at cost. Quote does not include legal
fees for trustee counsel opinions.
Services not included in this Fee Schedule, but deemed necessary or desirable by you,
may be subject to additional charges based on a mutually agreed upon fee schedule.
Our proposal is subject in all aspects to Region's review and acceptance of the final
financing documents, which set forth our duties and responsibilities.
By: /s/ Doug Milner
Doug Milner
Vice President
PA PING AGENT/REGISTRAR'S RECEIPT
The undersigned duly authorized representative of Regions Bank, paying agent/registrar
for the following described bonds:
DEVELOPMENT AUTHORITY OF PEARLAND TAX INCREMENT
CONTRACT REVENUE AND REFUNDING BONDS, SERIES 2012, dated
May 1, 2012, in the total authorized aggregate amount of $56,915,000,
certifies that said bonds have been delivered to the Purchaser, and that the purchase price has
been received on behalf of the Authority.
EXECUTED AND DELIVERED this 22 nd day of May, 2012.
REGIONS BANK
By:
Title: VICE PRESIDENT
1-IOU:3219706.1
NGHIEM V. DOAN
DEPUTY CITY ATTORNEY
TELEPHONE (281) 652-1665
LAWRENCE G. PROVINS
ASSISTANT CITY ATTORNEY II
TELEPHONE (281) 652-1666
KATIE A. LEININGER
ASSISTANT CITY ATTORNEY I
TELEPHONE (281) 997-5918
DARRIN M. COKER
CITY ATTORNEY
TELEPHONE (281) 652-1678
JENIFER K. SMITH
LEGAL SECRETARY
TELEPHONE (281) 652-1664
TELECOPIER (281) 652-1679
May 22, 2012
Development Authority of Pearland
Capital One Public Funding, LLC
Re: $56,915,000 Development Authority of Pearland Tax Increment Contract Revenue Bonds, Series 2012 (the
"Bonds")
Ladies and Gentlemen:
I have reviewed: (i) City of Pearland Ordinance No. 891, creating Reinvestment Zone Number Two, City of
Pearland, Texas (the "Zone"), (ii) City of Pearland Ordinance No. 918, approving the Project Plan and Reinvestment
Zone Financing Plan (the "Project Plan"), (iii) City of Pearland Resolution No. 2004-107, authorizing the
incorporation of the Development Authority of Pearland (the "Authority"), (iv) City of Pearland Ordinance No.
1276, approving the Enlarging of the Boundaries of the Zone, Amending the Project Plan, (v) City of Pearland
Ordinances No. 1312 and 1313 enlarging the Zone, (vi) City of Pearland Ordinances No. 1312 and 1314 amending
the Project Plan, and (vii) the City of Pearland Resolution No. R2012-55, authorizing the issuance of the Bonds
(together with the above-mentioned ordinance and resolution, the "Ordinances and Resolutions"), (viii) that certain
Agreement by and between the City of Pearland, Texas (the "City"), the Zone, and the Authority as approved by the
City Council by Ordinance No. R2004-170, as amended by City Resolution No. R2007-143 (the "Tri-Party
Agreement"), (ix) that certain Interlocal Agreement approved by the City by Resolution No. R99-45 adopted by the
City Council on June 14, 1999, by and between the City, the Zone, and Alvin Independent School District (the
"AISD Agreement"), (x) that certain Interlocal Agreement approved by the City by Resolution No. R99-62 adopted
by the City Council on August 30, 1999, by and between the City, the Zone, and Brazoria County, as amended by a
First Amendment approved by the City by Resolution No. R2006-181 (the "Brazoria Agreement"), and (xi) that
certain Interlocal Agreement approved by the City by Resolution No. R99-57 adopted by the City Council on
August 9, 1999, as amended by a First Amendment approved by the City by Resolution No. R2006-182, (the "Fort
Bend Agreement," and together with the Tri-Party Agreement, the AISD Agreement and the Brazoria Agreement,
the "Agreements"). I have also conducted such other investigations of fact and law as I have found necessary or
advisable for the purposes of this opinion. As the City Attorney, I am also aware of litigation and other legal matters
related to the City that come to my attention in the performance of my duties.
Based on such review, I am of the opinion that:
I. The City is a home rule city duly organized and existing under the Constitution and laws of the State of Texas
with full power and authority, among other things, (i) to adopt and perform its duties and obligations under the
Agreements, and (ii) to collect and transfer to the Authority the tax increments described in the Tri-Party
Agreement.
2. The Agreements have been duly authorized, executed and delivered by, and the Ordinances and Resolutions
have been duly adopted by, the City, and assuming due authorization, execution and delivery by the other parties
thereto, such instruments constitute legal, valid and binding obligations of the City enforceable in accordance with
their terms, except to the extent that their enforceability may be limited by applicable provisions of the federal
bankruptcy laws and any other similar laws affecting the rights of creditors of political subdivisions generally, and
except that such enforceability is subject to general principals of equity and the exercise of judicial discretion
3519 LIBERTY DRIVE • PEARLAND, TEXAS 77581-5416 • 281-652-1600 • www.ci.pearland.tx.us
`a' Printed on Recycled Paper
regardless of whether such enforceability is considered in a proceeding in law or at equity).
3.To my knowledge, compliance with the provisions of the Agreements and the Ordinances and Resolutions does
not conflict with or constitute a breach of or default under, any applicable law, administrative regulation, court order
or consent decree of the State of Texas or any department, division, agency, or instrumentality thereof or any loan
agreement, note, resolution, indenture, agreement or other instrument to which the City is a party.
4.All approvals, consents and orders of any governmental authority, board, agency or commission having
jurisdiction which would constitute conditions precedent to the performance by the City of its obligations under the
Agreements and the Ordinances and which reasonably can be obtained at this time have been obtained.
5.Except as disclosed in writing by the City to the addresses on or prior to the date of the sale of the Bonds, there
is no litigation or proceeding against the City, pending or to my knowledge, after due inquiry, threatened, in any way
contesting or affecting the validity or enforceability of the Agreements or the Ordinances and Resolutions, or
contesting the powers of the City or its authority with respect to the Ordinances and Resolutions or the Agreements.
In making the above statements, I have not reviewed the dockets of courts or relevant administrative agencies nor
have I contacted such courts or agencies; I have relied solely on information brought to my attention as City
Attorney as of the date of this letter.
The information set forth herein is as of the date of this letter, and I disclaim any undertaking to advise you of
changes which thereafter may be brought to my attention. This letter is solely for your information in connection
with the sale of the Bonds and may not be relied upon by any other person without my prior written consent. It is
not to be quoted in whole or in part or otherwise referred to in any documents, except for a closing list or transcript
of the proceedings related to the issuance of the Bonds, including a transcript submitted to the Attorney General of
the State of Texas, and is not to be filed with or furnished to any other governmental entity or person, without my
prior written consent. The opinions herein expressed and the statements herein made are limited in all respects to
the laws of the State of Texas and applicable federal law.
Sincerely yours,
Darrin Coker,
City Attorney
haynesboone
May 22, 2012
Development Authority of Pearland
Pearland, Texas
Re: Development Authority of Pearland Tax Increment Contract Revenue and
Refunding Bonds Series 2012 (the "Bonds")
Ladies and Gentlemen:
We have acted as counsel to Regions Bank, an Alabama banking corporation (the
"Bank"), in its capacity as bond trustee under an Indenture of Trust dated as of May 1, 2012,
relating to the Bonds referred to above (the "Bond Indenture") between the Development
Authority of Pearland (the "Issuer") and the Bank.
For the purpose of rendering the opinions contained herein, we have been furnished with,
and have relied upon the original or a copy of the fully executed Bond Indenture, the Paying
Agent/Registrar Agreement dated as of April 30, 2012 between the Issuer and the Bank (the
"Paying Agent/Registrar Agreement") and the Escrow Agreement dated as of May 1, 2012
between the Issuer and the Bank (the "Escrow Agreement" and, together with the Bond
Indenture and the Paying Agent/Registrar Agreement, collectively the "Bank Documents").
In addition to the Bank Documents, other documents which we have reviewed in
rendering this opinion, and upon which we have relied, include the following:
(i)the Restated Articles of Incorporation and the By-laws (as amended and restated
on May 13, 2010) of the Bank and the Certificate of the Bank and attachments
thereto delivered by the Bank at the closing of the above-captioned transaction;
(ii)a Certificate from the Secretary of the State of Alabama as of a recent date
indicating that the Bank is in existence and is in good standing in the State of
Alabama;
(iii)the Foreign Bank or Trust Company Filing of the Bank with the Secretary of State
of Texas;
Haynes and Boone, LLP
Attorneys and Counselors
One Houston Center
1221 McKinney Street, Suite 2100
Houston, Texas 77010-2007
Phone: 713.547.2000
Fax: 713.547.2600
www.haynesboone.com
Development Authority of Pearland
Page 2
(iv)a Certificate of Account Status from the Texas Comptroller of Public Accounts as
of a recent date indicating that the Bank is in good standing with that office;
(v)a Certificate of Good Standing as of a recent date from the Department of
Revenue of the State of Alabama indicating that the Bank is in good standing with
that office; and
(vi)such other records, agreements, certificates of public officials, and other
documents as we have deemed necessary for the purposes of rendering the
opinions herein expressed and as have been furnished to us by the Bank.
Scope of Examination and
General Assumptions and Qualifications
We have been furnished with and examined originals or copies, certified or otherwise
identified to our satisfaction, of all such records of the Bank and other instruments, certificates of
officers and representatives of the Bank, certificates of public officials, and other documents as
we have deemed necessary or desirable as a basis for the opinions hereinafter expressed. As to
questions of fact material to the opinions expressed below, we have relied, with your consent and
to the extent we deem appropriate, upon representations made to us by officers of the Bank
(including representations contained in the Certificate of the Bank and attachments thereto
delivered at the closing of the transaction described herein) and other documents, records, and
instruments furnished to us by the Bank, without independent check or verification of the
accuracy of such representations.
In making our examinations, we have assumed, with your consent, (i) the genuineness of
all signatures, (ii) the authenticity of all documents submitted to us as originals, (iii) the
conformity to original documents of all documents submitted to us as certified or photostatic
copies, (iv) the authenticity of the originals of the documents referred to in the immediately
preceding clause (iii), (v) that the parties to the Bank Documents (other than the Bank) have full
power, authority, and legal right to enter into and to perform their respective obligations under
the Bank Documents, and the due authorization, execution, and delivery of the Bank Documents
by authorized officers of the parties thereto (other than the Bank), (vi) that the Bank Documents
constitute the valid, binding, and enforceable agreements of the parties thereto (other than the
Bank), and (vii) the correctness and accuracy of all facts set forth in all certificates and reports
identified in this opinion.
Our opinion in paragraph 1 below as to the existence and good standing of the Bank in
the State of Alabama and the qualification of the Bank to do business and its good standing in the
State of Texas is based solely upon the Certificate of Good Standing from the Department of
Revenue of the State of Alabama, the Foreign Bank or Trust Company filing of the Bank with.
Development Authority of Pearland
Page 3
the Secretary of State of Texas, and the Certificate of Account Status from the Texas
Comptroller of Public Accounts, as the case may be, without further investigation as to the
criteria for existence and good standing of the Bank in Alabama and Texas the or qualification to
do business in Texas or any related legal issues. We have made no additional investigation after
the date of the certificates referenced to above in rendering such opinion.
We express no opinion as to the status of any of the Series 2012 Bonds under (i) any
federal securities law, including, but not limited to, the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, the Trust Indenture Act of 1939, as amended, or
any state securities or "blue sky" law; (ii) any federal, state, or local tax law; or (iii) any usury
law.
The opinions expressed below are qualified to the extent that a bank regulatory agency or
other entity with jurisdiction over the Bank may limit or suspend any rights, power or authority
of the Bank.
Our opinions set forth below are limited solely to matters governed by the laws of the
State of Texas and the federal law of the United States of America, and we express no opinion as
to questions concerning the laws of any other jurisdiction.
Specific Limitations and Qualifications
on Opinions Regarding Enforceability
With respect to our opinion set forth in Paragraph 3 below, we advise you that:
1.The enforceability of the Bank Documents is subject to the effects of
(i) applicable bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium,
rearrangement, liquidation, conservatorship, or similar laws . of general application now or
hereafter in effect relating to or affecting the rights of creditors generally, (ii) general equity
principles, and (iii) statutory provisions of the federal Bankruptcy Code and the Uniform
Fraudulent Conveyance Act as adopted by the State of Texas (and related court decisions)
pertaining to the voidability of preferential or fraudulent transfers, conveyances, and obligations.
2.The opinion that the Bank Documents is enforceable is also subject to the
qualification that certain of the remedial, waiver, and other provisions of such agreements may
not be enforceable; but such unenforceability will not, in our judgment, render the Bank
Documents invalid as a whole or substantially interfere with the realization of the principal legal
benefits and/or security intended to be provided by such agreements, except to the extent of any
procedural delay which may result therefrom.
haynesboone
Development Authority of Pearland
Page 4
3.We express no opinion as to: (a) the enforceability of provisions of the Bank
Documents to the extent that such provisions: (i) purport to waive or affect any rights to notices
required by law and that are not subject to waiver; (ii) purport to waive trial by jury; (iii) state
that the Bank's failure or delay in exercising rights, powers, privileges or remedies under such
agreements shall not operate as a waiver thereof; (iv) purport to indemnify any person for
violations of federal or state securities laws or environmental laws, or any obligation to the
extent such obligation arises from or is a result of such person's own fraud, negligence, or willful
misconduct or to the extent that such indemnification is inconsistent with public policy;
(v) purport to establish or satisfy certain factual standards or conditions; (vi) purport to sever
unenforceable provisions from the Bank Documents, to the extent that the enforcement of
remaining provisions would frustrate the fundamental intent of the parties to such documents;
(vii) restrict access to legal or equitable remedies; (viii) purport to provide remedies inconsistent
with applicable law; or (ix) providing that decisions by a party are conclusive or may be made in
its sole discretion; (b) whether a court would grant specific performance or any other equitable
remedy with respect to enforcement of any provision contained in the Bank Documents; (c) the
enforceability of any provision in the Bank Documents that purports to appoint an agent for
service of process or establish or otherwise affect jurisdiction, venue, evidentiary standards, or
limitation periods, or procedural rights in any suit or other proceeding; (d) the enforceability of
any provision in the Bank Documents that purports to waive, subordinate, or otherwise restrict or
deny access to rights, benefits, claims, causes of action, or remedies that cannot be waived,
subordinated, or otherwise restricted or denied; (e) the enforceability of any provision in the
Bank Documents that allows the Bank to accelerate the maturity date of the obligations
evidenced by such agreements, to institute foreclosure proceedings, or to exercise any similar
right, without notice to the person or entity signatory thereto or bound thereby; (f) the
enforceability of any provision contained in the Bank Documents relating to the appointment of a
receiver, to the extent that appointment of a receiver is governed by applicable statutory
requirements, and to the extent that such provision may not be in compliance with such
requirements; (g) the effect of the law of any jurisdiction wherein the Bank may be located or
wherein the enforcement of such agreements may be sought that limits the rates of interest
legally chargeable or collectible; or (h) the enforceability of any provision in the Bank
Documents requiring written amendments or waivers of such documents insofar as it suggests
that oral or other modifications, amendments, or waivers could not effectively be agreed upon by
the parties or that the doctrine of promissory estoppel might not apply.
4.We express no opinion regarding the enforceability of any documents or
agreements referenced in the Bank Documents (other than the Bank Documents).
Based on our examination of the foregoing as aforesaid, we are of the opinion that, as of
the date hereof:
haynesboone
Development Authority of Pearland
Page 5
The Bank is in good standing and qualified to do business in the State of Texas.
2.The Bank has all requisite power and authority to execute and deliver the Bank
Documents in the capacities therein stated, and to perform its obligations under, and consummate
all of the transactions to be performed by it as contemplated by, such agreements.
3.The Bank Documents have been duly authorized, executed, and delivered by the
Bank in the capacities therein stated. The Bank Documents constitute the legal, valid, and
binding obligations of the Bank in the capacities therein stated, enforceable in accordance with
their respective terms.
This opinion (i) is rendered pursuant to your request and is solely for your information
and assistance in connection with the above transactions, and may not be relied upon by any
other person or for any other purpose without our prior written consent, (ii) has been prepared in
accordance with the customary practice of lawyers who regularly give, and lawyers who
regularly advise recipients regarding, opinions of this kind, (iii) is delivered and is effective as of
the date of this opinion first shown above, and, accordingly, this opinion is based on matters
existing on such date, and we undertake no, and hereby disclaim any, obligation after the date of
this opinion to advise you of any change in any of the opinions rendered herein or any change in
any of the facts upon which any such opinions may be based, and (iv) is limited to the matters
stated herein and no opinions may be inferred or implied beyond the matters expressly stated
herein. The opinions expressed herein are for the sole benefit of, and may only be relied on by
the persons to whom it is addressed. In no manner are our opinions to be relied upon for any
reason other than for the purpose for which they are being furnished.
Respectfully submitted,
HAYNES AND BOONE, LLP
942374_I.DOC
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Escrow Agreement"), dated for convenience as
of May 1, 2012, but effective on the Escrow Funding Date described herein, is made and entered
into by and between the Development Authority of Pearland (the "Authority"), and Regions
Bank, as escrow . agent (together with any successor or assign in such capacity, the "Escrow
Agent").
WHEREAS, the Authority heretofore issued certain bonds and other obligations
(hereinafter defined as the "Refunded Bonds") that it desires to refund in advance of their
maturities;
WHEREAS, pursuant to Chapter 431, Texas Transportation Code, as amended (the
"Act") the Authority is authorized and empowered to sell bonds in an amount sufficient, together
with other available funds or resources, to provide for the payment of obligations which are to be
discharged, deposit the proceeds of such refunding bonds with a paying agent and enter into an
escrow or similar agreement with such paying agent for the safekeeping, investment,
reinvestment, administration, and disposition of such deposit of proceeds, upon such terms and
conditions as the parties may agree, provided such deposit may be invested only in direct
obligations of the United States of America, including obligations the principal of and interest on
which are unconditionally guaranteed by the United States of America, and which may be in
book entry form and which shall mature and/or bear interest payable at such times and in such
amounts as will be sufficient to provide for the scheduled payment of such discharged bonds;
WHEREAS, the Board of Directors of the Authority has adopted a resolution (the
"Refunding Bond Resolution") authorizing the issuance, sale and delivery of the Authority's
Tax Increment Contract Revenue and Refunding Bonds, Series 2012 (the "Refunding Bonds"),
for the purpose, among other things, of providing the funds necessary to refund the Refunded
Bonds;
WHEREAS, to provide for the payment of the Refunded Bonds, the Authority has
provided for the transfer to the Escrow Agent pursuant to this Escrow Agreement of proceeds of
the Refunding Bonds together with any other legally available funds, if any; and
WHEREAS, the Board of Directors of the Authority has further determined to effectuate
the advance refunding of the Refunded Bonds pursuant to this Escrow Agreement, under which
provision is made for the safekeeping, investment, reinvestment, administration and disposition
of proceeds of the Refunding Bonds so as to provide firm banking and financial arrangements for
the discharge and final payment of the Refunded Bonds;
NOW, THEREFORE, in consideration of the mutual undertakings, promises and
agreements herein contained, and other good and valuable consideration, the receipt and
sufficiency of which hereby are acknowledged, and in order to secure the full and timely
payment of the principal of and interest on the Refunded Bonds, the Authority and the Escrow
Agent contract and agree as follows:
I-IOU:3212867.3
ARTICLE I.
DEFINITIONS AND INTERPRETATIONS
Section 1.1. Definitions. Unless otherwise expressly provided or unless the context
clearly requires otherwise, the following terms shall have the respective meanings specified
below for all purposes of this Escrow Agreement:
"Authority" shall mean the Development Authority of Pearland and, where appropriate,
its Board of Directors.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the applicable
regulations thereunder and under the Internal Revenue Code of 1954.
"Escrow Agent" shall mean Regions Bank, in its capacity as escrow agent hereunder, and
any successor or assign in such capacity.
"Escrow Agreement" shall mean this escrow agreement.
"Escrow Deposit" shall mean the initial deposit into the Escrow Fund, as more
particularly described in Section 2.1.
"Escrow Fund" shall mean the fund created in Section 3.1 of this Escrow Agreement to
be administered by the Escrow Agent pursuant to the provisions of this Escrow Agreement.
"Escrow Funding Date" shall mean the date on which the District Deposits with the
Escrow Agent the cash and Escrowed Securities described in Section 2.1.
"Escrowed Securities" shall mean the Limited Yield Securities and the Open Market
Securities.
"Limited Yield Securities" shall mean the noncallable United States Treasury
Obligations-State and Local Government Series to be initially purchased with proceeds of the
Refunding Bonds, as more fully described in the Report attached hereto, together with all
reinvestments of the proceeds thereof as may be directed in Section 4.2 or permitted in Section
4.3(b).
"Open Market Securities" shall mean the United States Treasury securities to be
purchased in the open market with cash and the proceeds of the Refunding Bonds, as more fully
described in the Report attached hereto, together with all reinvestments of the proceeds thereof
as may be directed in Section 4.2 or permitted in Section 4.3(b), or cash or obligations
substituted therefor pursuant to Section 4.3(a).
"Paying Agent for the Refunded Bonds" shall mean Wells Fargo Bank, N.A., and its
successors and assigns.
"Refunded Bond Resolution" shall mean the Authority's resolution authorizing the
issuance, sale and delivery of the Refunded Bonds.
2
HOU:3212867.3
"Refunded Bonds" shall mean the Authority's outstanding bonds listed on Exhibit B
hereto.
"Refunding Bond Resolution" shall mean the Authority's resolution adopted April 30,
2012, authorizing the issuance, sale and delivery of the Refunding Bonds.
"Refunding Bonds" shall mean the Authority's Tax Increment Contract Revenue and
Reftinding Bonds, Series 2012, dated May 1,.2012.
"Report" shall mean the verification report prepared by Grant Thornton LLP, independent
certified public accountants, relating to the advance refunding of the Refunded Bonds, a copy of
which is attached hereto as Exhibit A, and any subsequent verification report required by
Section 4.3.
Section 1.2. Interpretations. The titles and headings of the articles and sections of this
Escrow Agreement 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 the terms hereof. This
Escrow Agreement and all of the terms and provisions hereof shall be liberally construed to
effectuate the purposes set forth herein and to achieve the intended purpose of providing for the
refunding of the Refunded Bonds in accordance with applicable law.
ARTICLE II.
DEPOSIT OF FUNDS AND ESCROWED SECURITIES
Section 2.1. Deposits to Escrow Fund. On the Escrow Funding Date, the Authority shall
deposit, or cause to be deposited, into the Escrow Fund the Escrow Deposit, consisting of the
following:
(a)Escrowed Securities more fully described in the Report; and
(b)A beginning cash balance as provided in the Report.
ARTICLE III.
CREATION AND OPERATION OF ESCROW FUND
Section 3.1. Escrow Fund. On the Escrow Funding Date, the Escrow Agent will create
on its books a special fund and irrevocable escrow to be knows as the Development Authority of
Pearland Tax Increment Revenue and Refunding Bonds, Series 2012 Escrow Fund (the "Escrow
Fund"). On the Escrow Funding Date, the Escrow Deposit described in Section 2.1 will be
deposited to the credit of the Escrow Fund. The Escrow Deposit and all proceeds therefrom shall
be the property of the Escrow Fund and shall be applied only in strict conformity with the terms
and conditions hereof. All Escrowed Securities, all proceeds therefrom and all cash balances
from time to time on deposit in the Escrow Fund are hereby irrevocably pledged to the payment
of the principal of, redemption premium, if any, and interest on the Refunded Bonds, which
HOU:3212867.3
payment shall be made by timely transfers to the Paying Agent for the Refunded Bonds of such
amounts at such times as are provided in Section 3.2. When the final transfers have been made
to the Paying Agent for the Refunded Bonds for the payment of such principal of, redemption
premium, if any, and interest on the Refunded Bonds, any balance then remaining in the Escrow
Fund shall be transferred to the Authority, and the Escrow Agent shall thereupon be discharged
from any further duties hereunder.
Section 3.2. Payment of Principal, Redemption Premium, if any, and Interest;
Redemption of Certain Refunded Bonds. (a) The Escrow Agent is hereby irrevocably instructed
to transfer to the Paying Agent for the Refunded Bonds from the cash balance from time to time
on deposit in the Escrow Fund the amounts required to pay the principal of, redemption
premium, if any, and interest on the Refunded Bonds in the amounts and at the times shown in
the Report; provided, however, that funds transferred to the Escrow Fund from the interest and
sinking funds for the Refunded Bonds, if any, and all investment earnings thereon be used for the
payment of the principal of, redemption premium, if any, and interest on the Refunded Bonds
prior to the use of proceeds of the Refunding Bonds for such purpose.
(b) Except for amounts transferred to the Paying Agent for the Refunded Bonds
pursuant to Section 3.2(a) and to the Authority pursuant to Section 4.2, the Escrow Agent agrees
that it shall never make any withdrawals from the Escrow Fund or assert any claims, liens or
charges against the Escrow Fund.
Section 3.3. Sufficiency of Escrow Fund. The Authority represents (based upon the
Report) that the successive receipts of the principal of and interest on the Escrowed Securities
will assure that the cash balance on deposit from time to time in the Escrow Fund will be at all
times sufficient to provide money for transfer to the Paying Agent for the Refunded Bonds at the
times and in the amounts required to pay the interest on the Refunded Bonds as such interest
comes due and to pay the principal of, redemption premium, if any, and interest on the Refunded
Bonds as the Refunded Bonds mature or are called for redemption, all is more fully set forth in
the Report. If, for any reason, at any time, the cash balances on deposit or scheduled to be on
deposit in the Escrow Fund shall be insufficient to transfer the amounts required by the Paying
Agent for the Refunded Bonds to make the payments set forth in Section 3.2, the Authority shall
timely deposit into the Escrow Fund, from lawfully available funds, additional funds in the
amounts required to make such payments. Notice of any such insufficiency shall be given
promptly by the Escrow Agent to the Authority as hereinafter provided, but the Escrow Agent
shall not in any manner be responsible for any insufficiency of funds in the Escrow Fund or the
Authority's failure to make additional deposits thereto.
Section 3.4. Trust Fund. The Escrow Agent at all times shall hold the Escrow Fund, the
Escrowed Securities and all other assets of the Escrow Fund wholly segregated from all other
funds and securities on deposit with the Escrow Agent; it shall never allow the Escrowed
Securities or any other assets of the Escrow Fund to be commingled with any other funds or
securities of the Escrow Agent; and it shall hold and dispose of the assets of the Escrow Fund
only as set forth herein. The Escrowed Securities and other assets of the Escrow Fund always
shall be maintained by the Escrow Agent for the benefit of the holders of the Refunded Bonds;
and a special account evidencing such fact shall be maintained at all times on the books of the
Escrow Agent. The holders of the Refunded Bonds shall be entitled to the same preferred claim
4
HOU:3212867.3
and first lien upon the Escrowed Securities, the proceeds thereof and all other assets of the
Escrow Fund to which they are entitled as holders of the Refunded Bonds. The amounts
received by the Escrow Agent under this Escrow Agreement shall not be considered as a banking
deposit by the Authority,, and the Escrow Agent shall have no right or title with respect thereto
except as escrow agent under the terms hereof. The amounts received by the Escrow Agent
hereunder shall not be subject to warrants, drafts or checks drawn by the Corporation or, except
to the extent expressly herein provided, by the Paying Agent for the Refunded Bonds.
Section 3.5. Security for Cash Balances. Cash balances from time to time on deposit in
the Escrow Fund, to the extent not insured by the Federal Deposit Insurance Corporation or its
successor, shall be continuously secured by a pledge of direct obligations of, or obligations
unconditionally guaranteed by, the United States of America, having a market value at least
equal to such cash balances.
Section 3.6 Grant of Security Interest. In order to secure payment when due of the
principal of and interest on the Refunded Bonds, the Authority hereby pledges and grants to the
Escrow Agent, for the account of the holders or owners of the Refunded Bonds and of any
appurtenant coupons, a security interest in all of its right, title, and interest, if any, in and to all
funds held hereunder and all investments thereof and agrees that the Escrow Agent shall have
and may exercise all of the rights of a secured party granted by the Texas Uniform Commercial
Code in respect thereof to the same extent as if such Code applied to such security interest.
ARTICLE IV.
LIMITATION ON INVESTMENTS
Section 4.1. General. Except as herein otherwise expressly provided, the Escrow Agent
shall not have any power or duty to invest any money held hereunder, to make substitutions of
the Escrowed Securities or to sell, transfer or otherwise dispose of the Escrowed Securities.
Section 4.2. Reinvestment of Proceeds of Open Market Securities. The Escrow Agent is
hereby authorized and directed to reinvest proceeds of the Open Market Securities, if any, which
are attributable to amounts received as principal of or interest on the Open Market Securities and
which are not immediately needed to pay the Refunded Bonds in direct obligations of the United
States of America, i.e., United States Treasury Bonds, Bills and Notes, in the amounts, and
maturing and bearing interest, all as set out in the Report. The Corporation hereby designates
and appoints the Escrow Agent as its agent and duly authorized representative for purposes of
subscribing for and purchasing such obligations, all of which shall constitute Escrowed
Securities. Any income or increment earned from such reinvestment remaining after final
payment of the Refunded Bonds, shall be promptly transferred to the Authority.
Section 4.3. Substitution of Securities. (a) Concurrently with the sale and delivery of the
Refunding Bonds, the Authority may, upon compliance with the conditions stated in subsection
(c) of this Section 4.3, at its option, substitute cash or non-interest bearing obligations of the
United States Treasury (i.e., Treasury obligations which mature and are payable in a stated
amount on the maturity date thereof and for which there are no payments other than the payment
5
I-IOU:3212867.3
made on the maturity date) for non-interest bearing Open Market Securities listed in the Report,
but only if such cash and/or substituted non-interest bearing direct obligations of the United
States Treasury:
(i)are in an amount, and/or mature in an amount, which, together with any cash
substituted for such obligations, is equal to or greater than the amount payable on
the maturity date of the obligation listed in the Report for which such obligation is
substituted, and
(ii)mature on or before the maturity date of the obligation listed in the Report for
which such obligation is substituted.
The Authority may at any time substitute any Open Market Securities which, as permitted by the
preceding sentence, were not deposited to the credit of the Escrow Fund, for the cash and/or
obligations that were substituted concurrently with the sale and delivery of the Refunding Bonds
for such Open Market Securities.
(b)At the written request of the Authority, and upon compliance with the conditions
hereinafter stated in subsection (c) of this Section 4.3, the Escrow Agent shall sell, transfer,
otherwise dispose of or request the redemption of all or any portion of the Escrowed Securities
and apply the proceeds therefrom to purchase Refunded Bonds or direct obligations of, or
obligations the principal of and interest on which are unconditionally guaranteed by, the United
States of America which do not permit the redemption thereof at the option of the obligor.
(c)Any such transaction described in subsections (a) and (b) of this Section 4.3 may
be affected by the Escrow Agent only if (1) the Escrow Agent shall have received a written
opinion from a recognized frnn of certified public accountants that such transaction will not
cause the amount of money and securities in the Escrow Fund to be reduced below an amount
which will be sufficient, when added to the interest to accrue thereon, to provide for the payment
of principal of, redemption premium, if any, and interest on the remaining Refunded Bonds as
they become due, and (2) the Escrow Agent shall have received the unqualified written legal
opinion of nationally recognized bond counsel or tax counsel acceptable to the Authority and the
Escrow Agent to the effect that (a) such transaction will not cause any of the Refunded Bonds or
Refunding Bonds to be an "arbitrage bond" within the meaning of the Code and (b) that such
transaction complies with the Constitution and laws of the State of Texas and with all relevant
documents relating to the issuance of the Refunded Bonds and the Refunding Bonds.
Section 4.4. Arbitrage. The Authority hereby covenants and agrees that it shall never
request the Escrow Agent to exercise any power hereunder or permit any part of the money in
the Escrow Fund or proceeds from the sale of Escrowed Securities to be used directly or
indirectly to acquire any securities or obligations if the exercise of such power or the acquisition
of such securities or obligations would cause any Refunding Bonds to be an "arbitrage bond"
within the meaning of the Code.
6
I-IOU:3212867.3
ARTICLE V.
RECORDS AND REPORTS
Section 5.1. Records. The Escrow Agent shall keep books of record and account in
which complete and correct entries shall be made of all transactions relating to the receipt,
disbursement, allocation and application of the money and Escrowed Securities deposited to the
Escrow Fund and all proceeds thereof, and such books shall be available for inspection at
reasonable hours and under reasonable conditions by the Authority and the holders of the
Refunded Bonds.
Section 5.2. Reports. For the period beginning on the Escrow Funding Date and ending
on September 30, 2012, and for each twelve (12) month period thereafter while this Agreement
remains in effect, the Escrow Agent shall prepare and send to the Authority within thirty (30)
days following the end of such period a written report summarizing all transactions relating to
the Escrow Fund during such period, including, without limitation, credits to the Escrow Fund as
a result of interest payments on or maturities of the Escrowed Securities and transfers from the
Escrow Fund to the Paying Agent for the Refunded Bonds or otherwise, together with a detailed
statement of all Escrowed Securities and the cash balance on deposit in the Escrow Fund as of
the end of such period.
ARTICLE VI.
CONCERNING THE ESCROW AGENT
Section 6.1. Representations of Escrow Agent. Regions Bank, hereby represents that it
has all necessary power and authority to enter into this Escrow Agreement and undertake the
obligations and responsibilities imposed upon it herein and that it will carry out all of its
obligations hereunder.
Section 6.2. Limitation on Liability. The liability of the Escrow Agent to transfer funds
to the Paying Agent for the Refunded Bonds for the payments of the principal of, redemption
premium, if any, and interest on the Refunded Bonds shall be limited to the proceeds of the
Escrowed Securities and the cash balances from time to time on deposit in the Escrow Fund.
Notwithstanding any provision contained herein to the contrary, the Escrow Agent shall have no
liability whatsoever for the insufficiency of funds from time to time in the Escrow Fund or any
failure of the obligor of the Escrowed Securities to make timely payment thereon, except for its
obligation to notify the Authority promptly of any such occurrence.
The recitals herein and in the proceedings authorizing the Refunding Bonds shall be
taken as the statements of the Authority and shall not be considered as made by, or imposing any
obligation or liability upon, the Escrow Agent. The Escrow Agent is not a party to the
Refunding Bond Resolution or the Refunded Bond Resolutions and in its capacity as Escrow
Agent is not responsible for or bound by any of the provisions thereof. In its capacity as Escrow
Agent, it is agreed that the Escrow Agent need look only to the terms and provisions of this
Escrow Agreement.
7
I-IOU:3212867.3
The Escrow Agent makes no representation as to the value, condition or sufficiency of
the Escrow Fund, or any part thereof, or as to the title of the Authority thereto, or as to the
security afforded thereby or hereby, and the Escrow Agent shall incur no liability or
responsibility with respect to any of such matters.
It is the intention of the Authority and the Escrow Agent that the Escrow Agent shall
never be required to use or advance its own funds or otherwise incur personal financial liability
in the performance of any of its duties or the exercise of any of its rights and powers hereunder.
The Escrow Agent shall not be liable for the performance of any duties, except such
duties as are specifically set forth in this Escrow Agreement, and no implied covenants or
obligations shall be read into this Escrow Agreement. Nothing herein contained shall relieve the
Escrow Agent from liability for its own grossly negligent action, grossly negligent failure to act
or willful misconduct, except that this sentence shall not be construed to limit the effect of the
immediately preceding sentence. The Escrow Agent shall not incur any liability for any error of
judgment made in good faith by a responsible officer thereof, unless it shall be proved that it was
grossly negligent in ascertaining the pertinent facts. The Escrow Agent shall be protected in
acting upon any notice, resolution, request, consent, order, certificate, report, opinion, bond or
other paper or document believed by it to be genuine, and to have been signed or presented by
the proper party or parties. The Escrow Agent may consult with counsel, and the opinion of such
counsel shall be full and complete authorization and protection in respect of any action taken or
suffered by it in good faith and in accordance therewith.
Unless it is specifically provided otherwise herein, the Escrow Agent has no duty to
determine or inquire into the happening or occurrence of any event or contingency or the
performance or failure of performance of the Authority with respect to arrangements or contracts
with others, with the Escrow Agent's sole duty hereunder being to safeguard the Escrow Fund
and to dispose of and deliver the same in accordance with this Escrow Agreement. If, however,
the Escrow Agent is called upon by the terms of this Escrow Agreement to determine the
occurrence of any event or contingency, the Escrow Agent shall be obligated, in making such
determination, only to exercise reasonable care and diligence, and in the event of error in making
such determination the Escrow Agent shall be liable only for its own misconduct or its
negligence. In determining the occurrence of any such event or contingency the Escrow Agent
may request from the Authority or any other person such reasonable additional evidence as the
Escrow Agent in its discretion may deem necessary to detenmine any fact relating to the
occurrence of such event or contingency, and in this connection may make inquiries of, and
consult with the Authority, among others, at any time.
The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in
good faith in the exercise of reasonable care and believed by it to be within the discretion or
power conferred upon it by this Escrow Agreement, nor shall the Escrow Agent be responsible
for the consequences of any error of judgment; and the Escrow Agent shall not be answerable
except for its own gross neglect or default, nor for any loss unless the same shall have been
through its gross negligence or want of good faith.
In the absence of bad faith, the Escrow Agent may rely conclusively upon the truth,
completeness and accuracy of the statements, certificates, opinions, resolutions and other
0
I-HOU:3212867.3
documents conforming to the requirements of this Escrow Agreement, and shall not be obligated
to make any independent investigation with respect thereto.
To the full extent permitted by law, the Authority agrees to indemnify, defend and hold
the Escrow Agent harmless from and against any and all loss, damage, tax, liability and expense
that may be incurred by the Escrow Agent arising out of or in connection with its acceptance or
appointment as Escrow Agent hereunder, including attorneys fees and expenses of defending
itself against any claim or liability in connection with its performance hereunder except that the
Escrow Agent shall not be indemnified for any loss, damage, tax, liability, or expense resulting
from its own negligence or willful misconduct.
Section 6.3. Compensation. On the Escrow Funding Date, the Authority will pay the
Escrow Agent, as a fee for performing the services hereunder and for all expenses incurred or to
be incurred by the Escrow Agent in the administration of this Escrow Agreement as set out in
Exhibit C. If the Escrow Agent is requested to perform any extraordinary services hereunder,
the Authority hereby agrees to pay reasonable fees to the Escrow Agent for such extraordinary
services and to reimburse the Escrow Agent for all expenses incurred by the Escrow Agent in
performing such extraordinary services. It is expressly provided that the Escrow Agent shall
look only to the Authority for the payment of such additional fees and reimbursement of such
additional expenses. The Escrow Agent hereby agrees that in no event shall it ever assert any
claim or lien against the Escrow Fund for any fees for its services, whether regular, additional or
extraordinary, as Escrow Agent, or in any other capacity, or for reimbursement for any of its
expenses.
Section 6.4. Successor Escrow Agents. If at any time the Escrow Agent or its legal
successor or successors should become unable, through operation of law or otherwise, to act as
escrow agent hereunder, or if its property and affairs shall be taken under the control of any state
or federal court or administrative body because of insolvency or bankruptcy or for any other
reason, a vacancy shall forthwith exist in the office of Escrow Agent hereunder. In such event
the Authority, by appropriate action, shall promptly appoint an Escrow Agent to fill such
vacancy. If no successor Escrow Agent shall have been appointed by the Authority within 60
days, a successor may be appointed by the holders of a majority in aggregate principal amount of
the Refunded Bonds then outstanding by an instrument or instruments in writing filed with the
Authority, signed by such holders or by their duly authorized attorneys. If, in a proper case, no
appointment of a successor Escrow Agent shall be made pursuant to the foregoing provisions of
this section within three months after a vacancy shall have occurred, the holder of any Refunded
Bond then out-standing may apply to any court of competent jurisdiction to appoint a successor
Escrow Agent. Such court may thereupon, after such notice, if any, as it may deem proper,
prescribe and appoint a successor Escrow Agent.
Any successor Escrow Agent shall be qualified to act in such capacity under Chapter
1207, Texas Government Code, as amended, and shall be a Authority organized and doing
business under the laws of the United States or the State of Texas, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000
and subject to supervision or examination by federal or state authority.
I-IOU:3212867.3
Any successor Escrow Agent shall execute, acknowledge and deliver to the Authority
and the Escrow Agent an instrument accepting such appointment hereunder, and the Escrow
Agent shall execute and deliver an instrument transferring to such successor Escrow Agent,
subject to the terms of this Agreement, all the rights, powers and trusts of the Escrow Agent
hereunder. Upon the request of any such successor Escrow Agent, the Authority shall execute
any and all instruments in writing for more fully and certainly vesting in and confirming to such
successor Escrow Agent all such rights, powers and duties. The Escrow Agent shall pay over to
its successor Escrow Agent a proportional part of the Escrow Agent's fee paid hereunder.
The Escrow Agent at the time acting hereunder may at any time resign and be discharged
from the escrow hereby created by giving not less than sixty (60) days' written notice to the
Authority specifying the date when such resignation will take effect. No such resignation shall
take effect unless a successor Escrow Agent shall have been appointed by the holders of the
Refunded Bonds or by the Authority as herein provided and such successor Escrow Agent shall
have accepted such appointment, in which event such resignation shall take effect immediately
upon the appointment and acceptance of a successor Escrow Agent.
The Escrow Agent may be removed at any time by an instrument or concurrent
instruments in writing delivered to the Escrow Agent and to the Authority and signed by the
holders of a majority in aggregate principal amount of the Refunded Bonds then outstanding.
Section 6.5. Interpleader. The Authority and the Escrow Agent agree that the Escrow
Agent may seek adjudication of any adverse claim, demands or controversy over its persons as
well as funds on deposit in a court of competent jurisdiction within the State of Texas; waive
personal service of any process; and agree that service of process by certified or registered mail,
return receipt requested, to the address set forth in this Agreement shall constitute adequate
service. The Authority and the Escrow Agent further agree that the Escrow Agent has the right
to file a bill of interpleader in any court of competent jurisdiction within the State of Texas to
determine the rights of any person claiming an interest herein.
ARTICLE VII.
MISCELLANEOUS
Section 7.1. Notices. Any notice, authorization, request or demand required or permitted
to be given hereunder shall be made or given in writing and shall be deemed to have been duly
given when mailed by registered or certified mail, postage prepaid, addressed as follows:
To the Escrow Agent:
Regions Bank
1717 St. James Place, Suite 500
Houston, Texas 77056
Attention: Corporate Trust Services
10
HOU:3212867.3
To the Authority:
Development Authority of Pearland
c/o the City of Pearland
3519 Liberty Drive
Pearland, Texas 77581
Attn: City Manager
The United States Post Office registered or certified mail receipt showing delivery of the
aforesaid shall be conclusive evidence of the date and fact of delivery. Either party hereto may
change the address to which notices are to be delivered by giving to the other party not less than
ten days' prior written notice thereof.
Section 7.2. Termination of Responsibilities. Upon the taking by the Escrow Agent of
all the actions as described herein, the Escrow Agent shall have no further obligations or
responsibilities hereunder to the Authority, the holders of the Refunded Bonds or to any other
person or persons in connection with this Escrow Agreement.
Section 7.3. Binding Agreement; Amendment. This Escrow Agreement shall be binding
upon the Authority and the Escrow Agent and their respective successors and legal
representatives and shall inure solely to the benefit of the holders of the Refunded Bonds, the
Authority, the Escrow Agent and their respective successors and legal representatives. This
Escrow Agreement shall not be subject to amendment without the written consent of the holders
of all Refunded Bonds then outstanding.
Section 7.4. Severability. If any one or more of the provisions contained in this Escrow
Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect,
such invalidity, illegality or unenforceability shall not affect any other provision of this Escrow
Agreement, but this Escrow Agreement shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein.
Section 7.5. Governing Law. This Escrow Agreement shall be governed exclusively by
the provisions hereof and by the applicable laws of the State of Texas.
Section 7.6. Time of Essence. Time shall be of the essence in the performance of
obligations from time to time imposed upon the Escrow Agent by this Escrow Agreement.
[SIGNATURE PAGE FOLLOWS]
11
1-IOU:3212867.3
EXECUTED as of the date first written above, but effective as set forth herein.
DEVELOPMENT AUTHORITY OF PEARLAND
r
By: Y
Chair
ATTEST:
Secretary
REGIONS BANK
By:_
Name:
Title:
ATTEST:
By:_
Name:
Title:
(SEAL)
S-1
HOU:3212867.1
EXECUTED as of the date first written above, but effective as set forth herein.
DEVELOPMENT AUTHORITY OF PEARLAND
By:
Chair
ATTEST:
Secretary
REGIONS BANK
By:
Name: R flôuplas Milner
Title: Vice President
ATTEST:
By:
Name:
Title: VIC E PRESIDENT
(SEAL)
S-1
HOU:3212867.2
EXHIBIT A
VERIFICATION REPORT
[See Tab No. 4]
HOU:3212867.3
EXHIBIT B
SCHEDULE OF REFUNDED BONDS
Tax Increment Contract Revenue Bonds, Series 2004
Tax Increment Contract Revenue Bonds, Series 2005
Tax Increment Contract Revenue Bonds, Series 2006
Tax Increment Contract Revenue Bonds, Series 2007
Tax Increment Contract Revenue Bonds, Series 2009
I-IOU:32128673
EXHIBIT C
FEE SCHEDULE
I-IOU:3212867.3
Trustee, Paying Agent, Registrar and Escrow Services for
Development Authority of Pearland
Tax Increment Contract Revenue and Refunding Bonds
Series 2012
Schedule of Fees
Acceptance Fee:.................................... $1, 000
Annual PAR Fee Option :......................$4,000 Annually in Advance
Annual Escrow Fee Option :..................$3,000
Trustee Counsel: .......................... $4000 Cap
Fees are payable at the closing of this transaction. Thereafter, fees and any expenses will
be billed on the anniversary date of the closing.
The above-mentioned fees are basic charges and do not include out-of-pocket expenses,
which will be billed in addition to the regular charges as required. Out-of-pocket
expenses shall include, but are not limited to: telephone tolls, stationery, travel and
postage expenses.
Charges for performing extraordinary or other services not contemplated at the time of
the execution of the transaction or not specifically covered elsewhere in this schedule will
be determined by appraisal in amounts commensurate with the service to be provided.
Counsel fees, if ever retained as a result of default or other extraordinary occurrence on
behalf of the bondholders or Regions will be billed at cost. Quote does not include legal
fees for trustee counsel opinions.
Services not included in this Fee Schedule, but deemed necessary or desirable by you,
may be subject to additional charges based on a mutually agreed upon fee schedule.
Our proposal is subject in all aspects to Region's review and acceptance of the final
financing documents, which set forth our duties and responsibilities.
By: Is/ Doug Milner
Doug Milner
Vice President
ESCROW AGENT'S RECEIPT FOR DOCUMENTS, SECURITIES, AND FUNDS
The undersigned, acting through its duly authorized officer, as Escrow Agent (the "Escrow
Agent") under the Escrow Agreement, dated as of May 1, 2012 (the "Escrow Agreement"),
between it and the Development Authority of Pearland (the "Authority"), relating to the Authority's
Tax Increment Contract Revenue and Refunding Bonds, Series 2012 (the "Refunding Bonds"),
hereby acknowledges receipt of the following:
A copy of the Escrow Agreement and a copy of the Report.
2. The following securities and funds which have been deposited to the Escrow Fund
as provided in Section 2.01 of the Escrow Agreement as of the date hereof:
(a)Escrowed Securities more fully described in the Report; and
(b)A beginning cash balance as provided in the Report
As a result of the receipt of the foregoing, the Escrow Agreement between the Escrow
Agent and the Authority has become effective as of the date hereof.
IN WITNESS WHEREOF, I have hereunto set my hand this 22 day of May, 2012.
REGIONS BANK
By:
Title: VICE PRESIDENT
HOU:3219713.1
CLOSING CERTIFICATE
Re: Development Authority of Pearland Tax Increment Contract Revenue and
Refunding Bonds, Series 2012
The undersigned is the duly acting Chairman of the Board of Directors of the
Development Authority of Pearland (the "Authority"). Pursuant to the Investment Letter
between Capital One Public Funding, LLC, the 'purchaser and the Authority, dated April 30,
2012 relating to the sale and purchase of the captioned Bonds (the "Bonds"), I hereby certify as
follows:
No litigation is pending against, nor to the best of my knowledge, threatened against the
Authority contesting or attacking the Bonds; restraining or enjoining the authorization,
execution, or delivery of the Bonds; affecting the provisions made for the payment of or security
for the Bonds; in any manner questioning the authority of proceedings for the authorization,
execution or delivery of the Bonds; or affecting the validity of the Bonds, the Bond Resolution,.
the Indenture, the corporate existence of the Authority, or the titles of the present directors of the
Board.
HOU:3218896.1
DEVELOPMENT AUTHORITY OF
PEARLAND
Dated: May 22, 2012 By: Uv?^t `
Chairman, Board of Directors
HOU:3218896.1
a-BOSC,Inc,John Robuck
Vice President
1401 McKinney Street, Suite 1650
Houston, Texas 77010
Phone: (713) 289-5897
Email: jrobuck@boscinc.com
May 21, 2012
Doug Milner
Vice President
Regions Bank
1717 St. James Place, Suite 500
Houston, Texas 77056
RE: Development Authority of Pearland
$56,915,000 Tax Increment Contract Revenue and Refunding Bonds, Series 2012 (the "Bonds")
Dear Mr. Milner:
The delivery of the above referenced bonds is scheduled for Tuesday, May 22, 2012 at 10:00 a.m. at your bank at the
above captioned address. Tanya Fischer of Andrews Kurth LLP, Houston, Texas, Bond Counsel, will be handling
legal matters relating to the closing.
At or prior to closing, the Wells Fargo Bank, N.A. will wire $1,374,330.00 representing the Reserve Fund
Contribution to Regions Bank ("Regions Bank") as follows:
Regions Bank
Birmingham, Alabama
ABA#: 062005690
Account #: 0017541387
Account Name: Wealth Management Operations
FFC: Development Authority of Pearland Closing
Attn: Jeri Jones (713) 693-5347
At or prior to closing, Capital One Public Funding LLC ("COPF") will wire $56,915,000.00 to Regions Bank in
immediately available funds as indicated above.
Receipt Recap:
From COPF $56,915,000.00
From the Wells Fargo Banks, N.A. 1,374,330.00
$58,289,330.00
Regions Bank will disburse the total amount of $58,289,330.00 as follows:
1. $54,746,730.23 shall be deposited into an escrow fund by Regions Bank to defease certain of the Authority's
outstanding debt obligations (the "Refunded Bonds").
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Development Authority of Pearland
Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Page 2
2.$3,256,142.27 (representing $3,250,000.00 in Project Fund Proceeds and $6,142.27 for Costs of Issuance)
shall be wired, as follows:
Wells Fargo Bank
Account Name: Development Authority of Pearland
ABA #: 121-000-248
Account #: 1007284258
3.$84,500.00 (representing $75,000.00 in Co-Bond Counsel fees and expenses and $9,5000 in Attorney General
Fees) shall be wired to Andrews Kurth LLP in consideration of their role of Co-Bond Counsel as described
below:
JPMorgan Chase Bank
ABA #: 113 000 609
Account #: 00100184952
Attn: Tiffany Sanders (713) 750-3725
Reference: 10566226, 0021230 / 199283
4.$75,000.000 shall be wired to Allen Boone Humphries Robinson LLP in consideration for their role as Co-
Bond Counsel as described below:
Allen Boone Humphries Robinson LLP
c/o Amegy Bank of Texas
P.O. Box 27459
Houston, Texas 77227
ABA #: 113 011 258
Account #: 3280756
5.$88,457.50 shall be wired to BOSC, Inc. in consideration of their role as Financial Advisor as described
below:
Bank of Oklahoma, N.A.
ABA #: 1039-0003-6
FBO: BOSC, Inc.
Account #: 473549335
Reference: Development Authority of Pearland
Attn.. Andrea White (405.272.2438)
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
Development Authority of Pearland
Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Page 3
6.$16,500.00 representing Verification Agent fees and expenses shall be wired to Grant Thornton LLP, as
follows:
Harris N.A.
ABA # 071 000 288
Swift Code: HATRUS44
Account # 2750602
Bank Address: 111 West Monroe Street, Chicago IL 60690
Beneficiary: Grant Thornton LLP
Reference: Bill Number 952444879
Client Number: 0177572
7.$10,000.00 representing Bank Counsel fees and expenses shall be wired to Fulbright & Jaworski LLP as
described below:
Amegy Bank of Texas
5 Post Oak Park
Houston, Texas 77027
ABA #: 113 011 258
Account #: 129909
Account Name: Fulbright & Jaworski LLP Operating
Reference: Marcus W. Deitz
File Number: 08015167 (Development Authority of Pearland)
8.$12,000.00 shall be withdrawn by Regions Bank from the proceeds of the Bonds and credit such sum to its
account as the Paying Agent Annual Administration fee and Escrow Agent Fee for the Bonds.
Please contract n e should you have any questions regarding this matter, or if I may be of any further assistance.
Respectfully submitted,
John Robuck
Vice President
BOSC, Inc.
Cc: Bill Eisen, City of Pearland, Texas
Claire Bogard, City of Pearland, Texas
Rick Witte, Andrews Kurth LLP
Tanya Fischer, Andrews Kurth LLP
Gregg Jones, Andrews Kurth LLP
Lynne Humphries, Allen Boone Humphries Robinson LLP
Trey Lary, Allen Boone Humphries Robinson LLP
Tina Kyle, Allen Boone Humphries Robinson LLP
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount-invested.
Development Authority of Pearland
Tax Increment Contract Revenue and Refunding Bonds, Series.2012
Page 4
Jessica Holoubek, Allen Boone Humphries Robinson LLP
Sylvia Moore, Allen Boone Humphries Robinson LLP
John Taylor, Capital One
Marcus Deitz, Fulbright, & Jaworski LLP
Mark Peroutka, Grant Thornton LLP
David LaFlamme, Grant Thornton LLP
Cary Gilliam, Regions Bank
Ryan O'Hara, BOSC, Inc.
Andrea White, BOSC, Inc.
Broker/Dealer Services and Securities offered by BOSC, Inc., an SEC registered investment adviser, a registered broker/dealer, member
FINRA/SIPC. SEC registration does not imply a certain level of skill or training. Insurance offered by BOSC Agency, Inc., an affiliated
agency. Investments and insurance are not insured by FDIC, are not deposits or other obligations of, and are not guaranteed by, any bank or
bank affiliate. Investments are subject to risks, including possible loss of principal amount invested.
f
May 18, 2012
Kathleen Wagner
Vice President & Trust Officer
Wells Fargo Bank, National Association
750 N. St. Paul Place, Suite 1750
MAC T9263-170
Dallas, Texas 75201
RE: Development Authority of Pearland
$56,915,000 Tax Increment Contract Revenue and Refunding Bonds, Series 2012 (the "Bonds")
Dear Ms. Wagner.
The delivery, of the above referenced bonds is scheduled for Tuesday, May 22, 2012 at 10:00 a.m. At or prior to
closing, please wire transfer from the Debt Service Reserve Fund $1,374,330.00 representing the Reserve Funds for
the Authority's Series 2005 and Series 2009 bond issues to Regions Bank ("Regions Bank") as follows:
Regions Bank
Birmingham, Alabama
ABA#: 062005690
Account #: 0017541387
Account Name: Wealth Management Operations
FFC: Development Authority of Pearland Closing
Attn: Jeri Jones (713) 693-5347
After closing, all remaining funds in the Debt Service Reserve Fund, the Pledge Revenue Fund and Debt Service
Fund shall be wired to the Authority, as follows:
Wells Fargo Bank
Account Name: Development Authority of Pearland
ABA #: 121-000-248
Account #: 1007284258
Please contract Claire Bogard at (281) 652-1671 should you have any questions regarding this matter, or if I may be
of any further assistance.
Sincerely,
Torn Reid
Chairman
3519 LIBERTY DRIVE • PEARLAND, TEXAS 77581-5416 • 281-652-1600 • www ci.peariand.tc.us
aP(n[ed on Reeyeled Paper
Development Authority of Pearland, Texas
Refunding Effects
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Less: Debt Service Plus:
Year Ending Current Total on Refunded Current Interest Bonds Capital Post Rfndg Post Rfnd
09/29 Debt Service Bonds (1)Principal Interest Appr Bonds Debt Service Savings (2)
2012 4,200,358 3,050,179 2,680,000 480,505 4,310,684
2013 4,199,826 4,199,826.2,720,000 1,665,015 4,385,015
2014 4,199,711 4,199,711 2,800,000 1,581,511 4,381,511
2015 4,199,779 4,199,779 2,885,000 1,495,551 4,380,551
2016 4,198,414 4,198,414 2,970,000 1,406,981 4,376,981
2017 4,201,536 4,201,536 3,070,000 1,315,802 4,385,802
2018 4,199,318 4,199,318 3,160,000 1,221,553 4,381,553
2019 4,199,861 4,199,861 3,255,000 1,124,541 4,379,541.
2020 4,084,511 4,084,511 3,120,000 1,024,613 4,144,613
2021 4,082,346 4,082,346 3,215,000 928,829 4,143,829
2022 4,083,428 4,083,428 3,030,000 830,128 3,860,128
2023 4,086,434 4,086,434 3,130,000 737,107 3,867,107
2024 4,087,070 4,087,070 3,225,000 641,016 3,866,016
2025 4,082,421 4,082,421 3,320,000 542,009 3,862,009
2026 4,084,968 4,084,968 3,425,000 440,085 3,865,085
2027 4,086,763 4,086,763 3,530,000 334,937 3,864,937
2028 4,084,363 4,084,363 3,635,000 226,566 3,861,566
2029 4,082,313 4,082,313 3,745,000 114,972 3,859,972
Totals $74,443,420 $73,293,241 $56,915,000 $16,111,721 $74,176,900
(1)- This column only reflects debt payments scheduled after the closing date of 05/22/2012.
(2)- Savings are reduced by fund transfers at closing totaling $1,374,330.00 (see Sources of funds report).
DAP 2012: RUNI2REFAGGPRIOR AGGREFAGGNEWI2 Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:55 v9.53
Page-1
Development Authority of Pearland, Texas•
Sources & Uses Report
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Sources of Funds:
Principal Amount of Current Interest Bonds (CIBs)56,915,000.00
Issuer Contribution of Reserve Fund 1,374,330.00
Total SOURCES of Funds $58,289,330.00
Uses of Funds:
Open Market Escrow Cost 54,746,723.28
New Money Proceeds 3,250,000.00
Issuance Expenses: ($289,500.00)
Bond Counsel 150,000.00
Attornery General Fee 9,500.00
Financial Advisory 88,500.00
Paying Agent Fees 10,000.00
Bank Counsel 10,000.00
Miscellaneous 5,000.00
Verification Agent 16,500.00
Rounding Amount 3,106.72
Total USES of Funds $58,289,330.00
Miscellaneous Bond Issuance Information:
Delivery Date:05/22/2012
Principal Amount of Bonds Being Refunded 49,230,000.00
Principal Amount of the Refunding Bonds 56,915,000.00
Proceeds of "The (new) Bonds"56;915,000.00
Rate/Yield on the Refunded Bonds 4.81771906%
"All Costs Included" TIC on the New Issue is 3.13696447%
Federal Arbitrage Yield on the New Issue is 3.07037433%
Yield on Escrow 0.81739657%
DAP_2012: RUN12REF NEWI2REF NEW12 AGGREF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:55 v9.53
Page -2
Development Authority of Pearland, Texas
Partial Form 8038-G Report (Rev. 11-2000)
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 05/22/2012 Refunding Issue Delivery Date = 05/22/2012
Part Ill Description of Obligations. (Complete for the entire issue for which this form is beinq filed.)
(a) Final maturity
date (b) Issue price (c) Stated redemption (d) Weighted (e) Yield
price at maturity I average maturity
21 09/01/2029 I $56,915,000.00 $56,915,000.00 9.221 years 3.070374%
Part IV Uses of Proceeds of Bond Issue (including underwriters' discount)
22 Proceeds used for accrued interest 22 0.00
23 Issue price of entire issue (enter amount from line 21, column (b))23 56,915,000.00
24 Proceeds used for bond issuance costs (including underwriters discount)24 289,500.00 ##
25 Proceeds used for credit enhancement 25 0.00 ##
26 Proceeds allocated to reasonably required reserve or replacement fund 26 0.00 ##
27 Proceeds used to currently refund prior issues 27 0.00 ##
28 Proceeds used to advance refund prior issues 28 53,372,393.28 ##
29 Total (add lines 24 through 28)29 53,661,893.28
30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here)30 3,253,106.72
Part V Description of Refunded Bonds (Complete this part only for refunding bonds.)
31 Enter the remaining weighted average maturity of the bonds to be currently refunded => 0.0000 years
32 Enter the remaining weighted average maturity of the bonds to be advance refunded => 9.8865 years
33 Enter the last date on which the refunded bonds will be called => 09/01/2018
34 Enter the date(s) the refunded bonds were issued See each Issue's O/S
Note: $1,374,330.00 in transerred dollars were allocated to adjust downward the amounts reflected in lines 27 & 28.
DAP 2012: RUN12REF NEWI2REF NEW12 Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 {JHR} 04/30/2012 @ 14:55 v9.53
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Development Authority of Pearland, Texas
Proof of Federal Arbitrage Yield
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date 05/22/2012 Delivery Date 05/22/2012
Proceeds to:Interest to:Recoverable,Disc Term BAB Total PV of Adj D/S
Face Bondholder(+)Bondholder(+)Recurring Total Bond Adjstmt "Direct Pymt"Adjusted to
Dates Amounts Issuer(-)Issuer(-) Fees Debt Service for Yld Cale Adjustment Cash Flow 3.07037433%
05/22/2012 0.00 -56,915,000.00 0.00 0.00 0.00 0.00 0.00 -56,915,000.00 -56,915,000.00
09/01/2012 2,680,000.00 2,680,000.00 480,504.89 0.00 3,160,504.89 0.00 0.00 3,160,504.89 3,134,132.49
03/01/2013 0.00 0.00 832,507.25 0.00 832,507.25 0.00 0.00 832,507.25 813,078.23
09/01/2013 2,720,000.00 2,720,000.00 832,507.25 0.00 3,552,507.25 0.00 0.00 3,552,507.25 3,417,139.51
03/01/2014 0.00 0.00 790,755.25 0.00 790,755.25 0.00 0.00 790,755.25 749,123.20
09/01/2014 2,800,000.00 2,800,000.00 790,755.25 0.00 3,590,755.25 0.00 0.00 3,590,755.25 3,350,274.52
03/01/2015 0.00 0.00 747,775.25 0.00 747,775.25 0.00 0.00 747,775.25 687,146.13
09/01/2015 2,885,000.00 2,885,000.00 747,775.25 0.00 3,632,775.25 0.00 0.00 3,632,775.25 3,287,758.98
03/01/2016 0.00 0.00 703,490.50 0.00 703,490.50 0.00 0.00 703,490.50 627,051.35
09/01/2016 2,970,000.00 2,970,000.00 703,490.50 0.00 3,673,490.50 0.00 0.00 3,673,490.50 3,224,832.90
03/01/2017 0.00 0.00 657,901.00 0.00 657,901.00 0.00 0.00 657,901.00 568,816.61
09/01/2017 3,070,000.00 3,070,000.00 657,901.00 0.00 3,727,901.00 0.00 0.00 3,727,901.00 3,174,384.41
03/01/2018 0.00 0.00 610,776.50 0.00 610,776.50 0.00 0.00 610,776.50 512,225.14
09/01/2018 3,160,000.00 3,160,000.00 610,776.50 0.00 3,770,776.50 0.00 0.00 3,770,776.50 3,114,531.96
03/01/2019 0.00 0.00 562,270.50 0.00 562,270.50 0.00 0.00 562,270.50 457,394.28
09/01/2019 3,255,000.00 3,255,000.00 562,270.50 0.00 3,817,270.50 0.00 0.00 3,817,270.50 3,058,312.00
03/01/2020 0.00 0.00 512,306.25 0.00 512,306.25 0.00 0.00 512,306.25 404,242.46
09/01/2020 3,120,000.00 3,120,000.00 512,306.25 0.00 3,632,306.25 0.00 0.00.3,632,306.25 2,822,787.35
03/01/2021 0.00 0.00 464,414.25 0.00 464,414.25 0.00 0.00 464,414.25 355,455.03
09/01/2021 3,215,000.00 3,215,000.00 464,414.25 0.00 3,679,414.25 0.00 0.00 3,679,414.25 2,773,583.49
03/01/2022 0.00 0.00 415,064.00 0.00 415,064.00 0.00 0.00 415,064.00 308,149.20
09/01/2022 3,030,000.00 3,030,000.00 415,064.00 0.00 3,445,064.00 0.00 0.00 3,445,064.00 2,518,991.52
03/01/2023 0.00 0.00 368,553.50 0.00 368,553.50 0.00 0.00 368,553.50 265,407.61
09/01/2023 3,130,000.00 3,130,000.00 368,553.50 0.00 3,498,553.50 0.00 0.00 3,498,553.50 2,481,331.46
03/01/2024 0.00 0.00 320,508.00 0.00 320,508.00 0.00 0.00 320,508.00 223,881.68
09/01/2024 3,225,000.00 3,225,000.00 320,508.00 0.00 3,545,508.00 0.00 0.00 3,545,508.00 2,439,167.28
03/01/2025 0.00 0.00 271,004.25 0.00 271,004.25 0.00 0.00 271,004.25 183,621.12
09/01/2025 3,320,000.00 3,320,000.00 271,004.25 0.00 3,591,004.25 0.00 0.00 3,591,004.25 2,396,325.93
03/01/2026 0.00 0.00 220,042.25 0.00 220,042.25 0.00 0.00 220,042.25 144,617.04
09/01/2026 3,425,000.00 3,425,000.00 220,042.25 0.00 3,645,042.25 0.00 0.00 3,645,042.25 2,359,388.11
03/01/2027 0.00 0.00 167,468.50 0.00 167,468.50 0.00 0.00 167,468.50 106,761.18
09/01/2027 3,530,000.00 3,530,000.00 167,468.50 0.00 3,697,468.50 0.00 0.00 3,697,468.50 2,321,497.16
03/01/2028 0.00 0.00 113,283.00 0.00 113,283.00 0.00 0.00 113,283.00 70,050.60
09/01/2028 3,635,000.00 3,635,000.00 113,283.00 0.00 3,748,283.00 0.00 0.00 3,748,283.00 2,282,773.90
03/01/2029 0.00 0.00 57,485.75 0.00 57,485.75 0.00 0.00 57,485.75 34,480.55
09/01/2029 3,745,000.00 3,745,000.00 57,485.75 0.00 3,802,485.75 0.00 0.00 3,802,485.75 2,246,285.60
Totals 56,915,000.00 0.00 16,111,716.89 0.00 73,026,716.89 0.00 0.00 16,111,716.89 0.00
Plus PV of Bond Insurance ..........0.00 '!..
0.00
DAP 2012: AGGNEWI2 Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR)04/30/201.2 @ 14:55 v9.53
Page-4
Development Authority of Pearland, Texas
Aggregation Spreadsheet Report
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Data are Principal Amounts Data are to Maturity
FY 09/30
Dates Totals NEW12REF NEW12
2012 2,680,000.00 2,375,000.00 305,000.00
2013 2,720,000.00 2,405,000.00 315,000.00
2014 2,800,000.00 2,475,000.00 325,000.00
2015 2,885,000.00 2,555,000.00 330,000.00
2016 2,970,000.00 2,630,000.00 340,000.00
2017 3,070,000.00 2,715,000.00 355,000.00
2018 3,160,000.00 2,795,000.00 365,000.00
2019 3,255,000.00 2,880,000.00 375,000.00
2020 3,120,000.00 2,855,000.00 265,000.00
2021 3,215,000.00 2,940,000.00 275,000.00
2022 3,030,000.00 3,030,000.00
2023 3,130,000.00 3,130,000.00
2024 3,225,000.00 3,225,000.00
2,025 3,320,000.00 3,320,000.00
2026 3,425,000.00 3,425,000.00
2027 3,530,000.00 3,530,000.00
2028 3,635,000.00 3,635,000.00
2029 3,745,000.00 3,745,000.00
Totals $56,915,000.00 $53,665,000.00 $3,250,000.00
Component Face Amt — Title ----- V From To
NEW12REF $53,665,000.00 Refunding Issue
NEW12 $3,250,000.00 New Money Portion
DAP 2012: AGGNEWI2 Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:55 v9.53
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Development Authority of Pearland, Texas
Issuance Expenses for NEWI2REF
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds,Series 2012
Expenses for NEW12REF
Expense Raises Exp has no
Expense Title Type Units Arb Yield Affect
on Arb Yield Total
Underwriters Discount V 0.000000 0.00 0.00 0.00
Bond Counsel F 150,000.00 0.00 150,000.00 150,000.00
Attornery General Fee F 9,500.00 0.00 9,500.00 9,500.00
Ratings F 0.00 0.00 0.00 0.00
Financial Advisory F 88,500.00 0.00 88,500.00 88,500.00
Paying Agent Fees F 10,000.00 0.00 10,000.00 10,000.00
Printing F 0.00 0.00 0.00 0.00
Bank Counsel F 10,000.00 0.00 10,000.00 10,000.00
Miscellaneous F 5,000.00 0.00 5,000.00 5,000.00
Verification Agent F 16,500.00 0.00 16,500.00 16,500.00
Totals $0.00 $289,500.00 $289,500.00
Type: F - Fixed Expense
V - Variable Expense Based on Issue Size
D - Variable Expense Based on Total Debt Service
E - Variable Expense Based on Total Debt Service Less Accrued Interest
R - Variable Expense Based on Reserve Fund Requirement
} DAP 2012: EXPI2REF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:55 v9.53
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Development Authority of Pearland, Texas
Refunding Effects
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Less: Debt Service Plus:Refunding Issue
Year Ending Current Total on Refunded Current Interest Bonds Capital Post Rfndg Post Rfndg
09129 Debt Service Bonds (1)Principal Interest Appr Bonds Debt Service Savings (2)
2012 4,200,358 3,050,179 2,375,000 453,067 3,978,246 -1,152,218
2013 4,199,826 4,199,826 2,405,000 1,574,603 3,979,603 220,223
2014 4,199,711 4,199,711 2,475,000 1,500,770 3,975,770 223,942
2015 4,199,779 4,199,779 2,555,000 1,424,787 3,979,787 219,992
2016 4,198,414 4,198,414 2,630,000 1,346,349 3,976,349 222,065
2017 4,201,536 4,201,536 2,715,000 1,265,608 3,980,608 220,929
2018 4,199,318 4,199,318 2,795,000 1,182,257 3,977,257 222,061
2019 4,199,861 4,199,861 2,880,000 1,096,451 3,976,451 223,411
2020 4,084,511 4,084,511 2,855,000 1,008,035 3,863,035 221,477
2021 4,082,346 4,082,346 2,940,000 920,386 3,860,386 221,960
2022 4,083,428 4,083,428 3,030,000 830,128 3,860,128 223,300
2023 4,086,434 4,086,434 3,130,000 737,107 3,867,107 219,327
2024 4,087,070 4,087,070 3,225,000 641,016 3,866,016 221,054
2025 4,082,421 4,082,421 3,320,000 542,009 3,862,009 220,413
2026 4,084,968 4,084,968 3,425,000 440,085 3,865,085 219,883
2027 4,086,763 4,086,763 3,530,000.334,937 3,864,937 221,826
2028 4,084,363 4,084,363 3,635,000 226,566 3,861,566 222,797
2029 4,082,313 4,082,313 3,745,000 114,972 3,859,972 222,341
Totals $74,443,420 $73,293,241 $70,454,312 $2,614,781 $53,665,000 $15,639,133
(1)- This column only reflects debt payments scheduled after the closing date of 05/22/2012.
(2)- Savings are reduced by fund transfers at closing totaling $1,374,330.00 (see Sources of funds report).
DAP 2012: RUNI2REF AGGPRIOR AGGREF NEWI2REF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR} 04/30/2012 @ 14:55 v9.53
Page -7
Development Authority of Pearland, Texas
Refunding Analysis Savings Report
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Maturing Proceeds @ Interest Total Escrowed FY Begins
09/30 Cumulative PV of Savings
Dates Amount Issue Date Coupon Yield Amount Debt Service Debt Savings Savings(1)3.07037433%
05/22/2012 -1,374,330.00 -1,374,330.00 -1,374,330.00
09/01/2012 2,375,000 2,375,000.00 3.070 3.070000 453,066.76 2,828,066.76 3,050,178.78 222,112.02 -1,152,217.98 220,258.64
03/01/2013 787,301.50 787,301.50 1,112,413.15 325,111.65 -827,106.33 317,524.21
09/01/2013 2,405,000 2,405,000.00 3.070 3.070000 787,301.50 3,192,301.50 3,087,413.15 -104,888.35 -931,994.68 -100,891.60
03/01/2014 750,384.75 750,38.4.75 1,072,355.65 321,970.90 -610,023.78 305,019.63
09/01/2014 2,475,000 2,475,000.00 3.070 3.070000 750,384.75 3,225,384.75 3,127,355.65 -98,029.10 -708,052.88 -91,463.88
03/01/2015 712,393.50 712,393.50 1,029,889.40 317,495.90 -390,556.98 291,753.54
09/01/2015 2,555,000 2,555,000.00 3.070 3.070000 712,393.50 3,267,393.50 3,169,889.40 -97,504.10 -488,061.08 -88,243.82
03/01/2016 673,174.25 673,174.25 984,206.90 311,032.65 -177,028.43 277,236.78
09/01/2016 2,630,000 2,630,000.00 3.070 3.070000 673,174.25 3,303,174.25 3,214,206.90 -88,967.35 -265,995.78 -78,101.42
03/01/2017 632,803.75 632,803.75 935,768.15 302,964.40 36,968.62 261,940.90
09/01/2017 2,715,000 2,715,000.00 3.070 3.070000 632,803.75 3,347,803.75 3,265,768.15 -82,035.60 -45,066.98 -69,855.00
03/01/2018 591,128.50 591,128.50 884,658.78 293,530.28 248,463.30 246,167.94
09/01/2018 2,795,000 2,795,000.00 3.070 3.070000 591,128.50 3,386,128.50 3,314,658.78 -71,469.72 176,993.58 -59,031.54
03/01/2019 548,225.25 548,225.25 829,930.65 281,705.40 458,698.98 229,160.94
09/01/2019 2,880,000 2,880,000.00 3.070 3.070000 548,225.25 3,428,225.25 3,369,930.65 -58,294.60 400,404.38 -46,704.33
03/01/2020 504,017.25 504,017.25 772,255.65 268,238.40 668,642.78 211,657.29
09/01/2020 2,855,000 2,855,000.00 3.070 3.070000 504,017.25 3,359,017.25 3,31,2,255.65 -46,761.60 621,881.18 -36,340.01
03/01/2021 460,193.00 460,193.00 713,673.15 253,480.15 875,361.33 194,009.54
09/01/2021 2,940,000 2,940,000.00 3.070 3.070000 460,193.00 3,400,193.00 3,368,673.15 -31,519.85 843,841.48 -23,760.01
03/01/2022 415,064.00 415,064.00 651,713.77 236,649.77 1,080,491.25 175,692.03
09/01/2022 3,030,000 3,030,000.00 3.070 3.070000 415,064.00 3,445,064.00 3,431,713.77 -13,350.23 1,067,141.02 -9,761.54
03/01/2023 368,553.50 368,553.50 585,716.89 217,163.39 1,284,304.41.156,386.57
09/01/2023 3,130,000 3,130,000.00 3.070 3.070000 368,553.50 3,498,553.50 3,500,716.89 2,163.39 1,286,467.80 1,534.37
03/01/2024 320,508.00 320,508.00 516,035.02 195,527.02 1,481,994.82 136,579.80
09/01/2024 3,225,000 3,225,000.00 3.070 3.070000 320,508.00 3,545,508.00 3,571,035.02 25,527.02 1,507,521.84 17,561.57
03/01/2025 271,004.25 271,004.25 441,210.64 170,206.39 1,677,728.23 115,324.72
09/01/2025 3,320,000 3,320,000.00 3.070 3.070000 271,004.25 3,591,004.25 3,641,210.64 50,206.39 1,727,934.62 33,503.41
03/01/2026 220,042.25 220,042.25 362,483.76 142,441.51 1,870,376.13 93,615.97
09/01/2026 3,425,000 3,425,000.00 3.070 3.070000 220,042.25 3,645,042.25 3,722,483.76 77,441.51 1,947,817.64 50,126.88
03/01/2027 167,468.50 167,468.50 278,381.26 110,912.76 2,058,730.40 70,706.89
09/01/2027 3,530,000 3,530,000.00 3.070 3.070000 167,468.50 3,697,468.50 3,808,381.26 110,912.76 2,169,643.16 69,637.82
03/01/2028 113,283.00 113,283.00 189,681.26 76,398.26 2,246,041.42 47,242.25
09/01/2028 3,635,000 3,635,000.00 3.070 3.070000 113,283.00 3,748,283.00 3,894,681.26 146,398.26 2,392,439.68 89,159.26
03/01/2029 57,485.75 57,485.75 96,156.25 38,670.50 2,431,110.18 23,194.97
09/01/2029 3,745,000 3,745,000.00 3.070 3.070000 57,485.75 . 3,802,485.75 3,986,156.25 183,670.50 2,614,780.68 108,501.76
$53,665,000 $53,665,000.00 $15,639,128.76 $69,304,128.76 $73,293,239.44 $2,614,780.68 $1,765,014.53
Acc Int
Grnd Total $53,665,000 $53,665,000.00 $15,639,128.76 $69,304,128.76 $73,293,239.44 $2,614,780.68 $1,765,014.53
(1) Includes: -1,374,330.00 Transfer. and $0.00 New Funds.
DAP 2012: RUN12REF NEWI2REFAGGREF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR} 04/30/2012 @ 14:56 v9.53
Page-8
Page-9
Development Authority of Pearland, Texas
Escrow Coverage Analysis - Investment Receipts vs. Cash Requirements
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Escrow Start Date is 05/22/2012
Idle $ Days
Escrow Escrow (Idle #Days Other Cash Draw Escrow
Dates Maturing Amounts Coupon Interest x Ball $1 000)Investments Required Fund Balance
05/22/2012 0.00 0.00 23.52 0.00 0.00 420.07
07/17/2012 0.00 115,303.13 3,934.59 0.00 0.00 115,723.20
08/20/2012 0.00 11,512.50 636.18 0.00 0.00 127,235.70
08/25/2012 0.00 55,320.00 365.11 0.00 0.00 182,555.70
08/27/2012 0.00 12,790.63 195.35 0.00 0.00 195,346.33
08/28/2012 0.00 50,341.89 737.06 0.00 0.00 245,688.22
08/31/2012 16,706,000.00 31,323.75 16,983.01 0.00 0.00 16,983,011.97
09/01/2012 0.00 0.00 390.98 0.00 16,980,178.78 2,833.19
01/17/2013 0.00 115,303.13 4,016.63 0.00 0.00 118,136.32
02/20/2013 0.00 11,512.50 648.24 0.00 0.00 129,648.82
02/25/2013 0.00 55,320.00 369.94 0.00 0.00 184,968.82
02/27/2013 555,000.00 12,790.63 752.76 0.00 0.00.752,759.45
02/28/2013 0.00 50,623.13 803.38 0.00 0.00 803,382.58'
03/01/2013 0.00 0.00 44.04 0.00 803,058.77 323.81
07/15/2013 200,000.00 0.00 400.65 0.00 0.00 200,323.81
07/17/2013 0.00 115,303.13 10,731.32 0.00 0.00 315,626.94
08/20/2013 1,842,000.00 11,512.50 10,845.70 0.00 0.00 2,169,139.44
08/25/2013 0.00 55,320.00 4,448.92 0.00 0.00 2,224,459.44
08/27/2013 0.00 3,425.00 2,227.88 0.00 0.00 2,227,884.44
08/28/2013 0.00 50,623.13 9,114.03 0.00 0.00 2,278,50.7.57
09/01/2013 0.00 0.00 61.93 0.00 2,278,058.77 448.80
01/17/2014 0.00.115,303.13 4,514.33 0.00 0.00 115,751.93
02/25/2014 0.00 55,320.00 342.14 0.00 0.00 171,071.93
02/27/2014 548,000.00 3,425.00 722.50 0.00 0.00 722,496.93
02/28/2014 0.00 50,623.13 773.12 0.00 0.00 773,120.06
03/01/2014 0.00 0.00 119.89 0.00 772,251.27 868.79
07/17/2014 0.00 115,303.13 4,530.70 0.00 0.00 116,171.92
08/25/2014 0.00 55,320.00 514.48 0.00 0.00 171,491.92
08/28/2014 11,571,000.00 50,623.13 47,172.46 0.00 0.00 11,793,115.05
09/01/2014 0.00 0.00 119.20 0.00 11,792,251.27 863.78
01/17/2015 0.00 115,303.13 2,323.34 0.00 0.00 116,166.91
02/06/2015 322,000.00 0.00 8,325.17 0.00 0.00 438,166.91
02/25/2015 0.00 55,320.00 1,973.95 0.00 0.00 493,486.91
03/01/2015 0.00 0.00 4.34 0.00 493,455.01 31.90
07/15/2015 86,000.00 0.00 . 172.06 0.00 0.00 86,031.90
07/17/2015 5,271,000.00.115,303.13 109,446.70 0.00 0.00 5,472,335.03
08/06/2015 1,863,000.00 0.00 44,012.01 0.00 0.00 7,335,335.03
08/12/2015 158,000.00 0.00 97,413.36 0.00 0.00 7,493,335.03
08/25/2015 0.00 55,320.00 52,840.59 0.00 0.00 7,548,655.03
09/01/2015 0.00 0.00 31.60 0.00 7,548,455.01 200.02
02/06/2016 278,000.00 0.00 5,285.80 0.00 0.00 278,200.02
02/25/2016 0.00 55,320.00 1,667.60 0.00 0.00 333,520.02
03/01/2016 0.00 0.00 68.60 0.00 333,015.63 504.39
07/15/2016 218,000.00 0.00 4,807.10 0.00 0.00 218,504.39
Page-10
I I idea x nave
Page-11
Development Authority of Pearland, Texas
Open Market Securities -- Settlement Date of 05/22/2012
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Open Market Escrow
Principal Accrued .
Name /CUSIP (Maturity)Amount Rate $ Price Yield/DR Cost Interest Total Cost
U.S. T-Notes 912828PH7 08/31/2012 16,706,000 0.375000 100.097420 0.020008 16,722,274.99 14,129.74 16,736,404.73
U.S. AGY's 3133XP2W3 02/27/2013 555,000 3.375000 102.461050 0.150001 568,658.83 4,422.66 573,081.49
Agency Discount31359YBS5 07/15/2013 200,000 0.000000 .99.748000 0.216516 199,496.00 0.00 199,496.00
U.S. AGY's 31398AX31 08/20/2013 1,842,000 1.250000 101.309330 0.195999 1,866,117.86 5,884.17 1,872,002.03
U.S. AGY's 3135G0AP8 02/27/2014 548,000.1.250000 101.758810 0.250001 557,638.28 1,617.36 559,255.64
U.S. AGY's 3135G0BY8 08/28/2014 11,571,000 0.875000 101.297860 0.300374 11,721,175.38 23,342.89 11,744,518.27
Agency Discount31358C3V6 02/06/2015 322,000 0.000000 99.058000 0.342545 318,966.76 0.00 318,966.76
Agency Discount31359YBW6 07/15/2015 86,000 0.000000 98.595000 0.440209 84,791.70 0.00 84,791.70
U.S. AGY's 3134A4VC5 07/17/2015.5,271,000 4.375000 111.938520 0.549999 5,900,279.39 80,071.61 5,980,351.00
Agency Discount31358C3W4 08/06/2015 1,863,000 0.000000 98.255000 0.536465 1,830,490.65 0.00 1,830,490.65
Agency Discount31358AES5 08/12/2015 158,000 0.000000 98.246000 0.536483 155,228.68 0.00 155,228.68
Agency Discount31358C3X2 02/06/2016 278,000 0.000000 97.624000 0.631262 271,394.72 0.00 271,394.72
Agency Discount31359YBY2 07/15/2016 218,000 0.000000 96.943000 0.726416 211,335.74 0.00 211,335.74
Agency D1scount31358C3Y0 08/06/2016 1,863,000 0.000000 96.941000 0.716487 1,806,010.83 0.00 1,806,010.83
U.S. AGY's 3137EACW7 08/25/2016 5,532,000 2.000000 105.185640 0.760000 5,818,869.61 26,738.00 5,845,607.61
Agency Discount3l358C3Z7 02/06/2017 177,000 0.000000 95.638000 0.912446 169,279.26 0.00 169,279.26
Agency Discount31358C4A1 08/06/2017 562,000 0.000000 94.205000 1.096845 529,432.10 0.00 529,432.10
Agency Discount31358C4B9 02/06/2018 168,000 0.000000 93.402000 1.138677 156,915.36 0.00 156,915.36
Agency Discount31359YCC9 07/15/2018 4,435,000 0.000000 90.558000 1.514085 4,016,247.30 0.00 4,016,247.30
Agency Discount31358C4C7 08/06/2018 1,863,000 0.000000 90.472000 1.513048 1,685,493.36 0.00 1,685,493.36
Totals $54,218,000 $54,590,096.80 $156,206.43 $54,746,303.23
WAM = 2.475 yrs
Yield = 0.82845120
DAP_2012: OMSI2ESC Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:56 v9.53
Page-12
Development Authority of Pearland, Texas
Aggregation Spreadsheet Report
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Data are Principal Amounts Data are to Maturity
FY 09130
Dates Totals OLD2004R OLD2004BR OLD2005R OLD2006R OLD2007R OLD2009R OLD2009AR
2012 1,900,000.00 425,000.00 300,000.00 375,000.00 485,000.00 315,000.00
2013 1,975,000.00 440,000.00 315,000.00 395,000.00 500,000.00 325,000.00
2014 2,055,000.00 460,000.00 330,000.00 405,000.00 520,000.00 -340,000.00
2015 2,140,000.00 485,000.00 340,000.00 425,000.00 540,000.00 350,000.00
2016 2,230,000.00 505,000.00 360,000.00 440,000.00 560,000.00 365,000.00
2017 2,330,000.00 530,000.00 375,000.00 455,000.00 585,000.00 385,000.00
2018 2,430,000.00 555,000.00 390,000.00 480,000.00 605,000.00 400,000.00
2019 2,540,000.00 585,000.00 390,000.00 460,000.00 680,000.00 425,000.00
2020 2,540,000.00 615,000.00 410,000.00 480,000.00 620,000.00 415,000.00
2021 2,655,000.00 645,000.00 425,000.00 '500,000.00 650,000.00 435,000.00
2022 2,780,000.00 675,000.00 450,000.00 520,000.00 680,000.00 455,000.00
2023 2,915,000.00 710,000.00 470,000.00 540,000.00 710,000.00 485,000.00
2024 3,055,000.00 420,000.00 330,000.00 485,000.00 570,000.00 740,000.00 260,000.00 250,000.00
2025 3,200,000.00 445,000.00 345,000.00 510,000.00 590,000.00 775,000.00 285,000.00 250,000.00
2026 3,360,000.00 475,000.00 360,000.00 530,000.00 620,000.00 810,000.00 565,000.00
2027 3,530,000.00 500,000.00 380,000.00 560,000.00 640,000.00 850,000.00 600,000.00
2028 3,705,000.00 535,000.00 390,000.00 585,000.00 675,000.00 885,000.00 635,000.00
2029 3,890,000.00 3,220,000.00 670,000.00
Totals $49,230,000.00 $9,005,000.00 $1,805,000.00 $7,225,000.00 $8,570,000.00 $14,415,000.00 $7,710,000.00 $500,000.00
Component Face Amt ----- Title -----From To
OLD2004R $9,005,000.00 Tax Increment Contract Revenue Bonds,
OLD2004BR $1,805,000.00 Tax Increment Contract Revenue Bonds,
OLD2005R $7,225,000.00 Tax Increment Contract Revenue Bonds,
OLD2006R $8,570,000.00 Tax Increment Contract Revenue Bonds,
OLD2007R $14,415,000.00 Tax Increment Contract Revenue Bonds, Series 2007
OLD2009R $7,710,000.00 Series 2009 Bonds
OLD2009AR $500,000.00 Series 2009 Bonds
DAP 2012: AGGREF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:56 v9.53
Page-13
Development Authority of Pearland, Texas
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03/01/2012 Tax Increment Contract Revenue Bonds,Delivery Date = 03/01/2012
Series 2004
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 -425,000.00 425,000.00 4.450 4.450000 100.000000 227,956.88 652,956.88 652,956.88 652,956.88
03/01/2013 ----- -218,500.63 218,500.63 -218,500.63
09/01/2013 -440,000.00 440,000.00 4.600 4.600000 100.000000 218,500.63 658,500.63 877,001.26 658,500.63
03/01/2014 ----- -208,380.63 208,380.63 -208,380.63
09/01/2014 -460,000.00 460,000.00 4.700 4.700000 100.000000 208,380.63 668,380.63 876,761.26 8,348,380.63
03/01/2015 ----- -197,570.63 197,570.63 --
09/01/2015 -485,000.00 *485,000.00 4.700 4.700000 100.000000 197,570.63 682,570.63 880,141.26 -
03/01/2016 ----- . -186,173.13 186,173.13 --
09/01/2016 -505,000.00 *505,000.00 4.800 4.800000 100.000000 186,173.13 691,173.13 877,346.26 -
03/01/2017 ----- -174,053.13 174,053.13 --
09/01/2017 - (4)530,000.00 *530,000.00 .5.000 5.000000 100.000000 174,053.13 704,053.13 878,106.26 -
03/01/2018 ----- -160,803.13 160,803.13 --
09/01/2018 - (4)555,000.00 *555,000.00 5.000 5.000000 100.000000 160,803.13 715,803.13 876,606.26 -
03/01/2019 ----- -146,928.13 146,928.13 --
09/01/2019 1,670,000.00 (4)585,000.00 *585,000.00 5.000 5.000000 100.000000 146,928.13 731,928.13 878,856.26 -
03/01/2020 ----- -132,303.13 132,303.13 --
09/01/2020 - (1)615,000.00 *615,000.00 5.000 5.000000 100.000000 132,303.13 747,303.13 879,606.26
03/01/2021 ----.- -116,928.13 116,928.13 --
09/01/2021 1,260,000.00 (1)645,000.00 *645,000.00 5.000 5.000000 100.000000 116,928.13 761,928.13 878,856.26 -
03/01/2022 ----- -100,803.13 100,803.13 --
09/01/2022 - (2)675,000.00 *675,000.00 5.125 5.125000 100.000000 100,803.13 775,803.13 876,606.26 -
03/01/2023 ----- -83,506.25 83,506.25 --
09/01/2023 .1,385,000.00 (2)710,000.00 *710,000.00 5.125 5.125000 100.000000 83,506.25 793,506.25 877,012.50 -
03/01/2024 ----- -65,312.50 65,312.50 --
09/01/2024 (3)420,000.00 *420,000.00 5.500 5.500000 100.000000 65,312.50 485,312.50 550,625.00 -
03/01/2025 ----- -53,762.50 53,762.50 --
09/01/2025 - (3)445,000.00 *445,000.00 5.500 5.500000 100.000000 53,762.50 498,762.50 552,525.00 -
03/01/2026 --- .-- -41,525.00 41,525.00 --
09/01/2026 - (3)475,000.00 *475,000.00 5.500 5.500000 100.000000 41,525.00 516,525.00 558,050.00 -
03/01/2027 ----- -28,462.50 28,462.50 --
09/01/2027 - (3)500,000.00 *500,000.00 5.500 5.500000 100.000000 28,462.50 528,462.50 556,925.00 -
03/01/2028 ----- -14,712.50 14,712.50 --
09/01/2028 2,375,000.00 (3)535,000.00 *535,000.00 5.500 5.500000 100.000000 14,712.50 549,712.50 564,425.00 -
Total 6,690,000.00 9,005,000.00 9,005,000.00 4,087,406.98 13,092,406.98 13,092,406.98 10,086,719.40
Acc Int -----
Grand Ttls 6,690,000.00 9,005,000.00 9,005,000.00 4,087,406.98 13,092,406.98 13 092,406.98 10,086,719.40
* - Bonds callable ...09/01/2014@100.000
TIC (Intl. all expenses).... 5.20170575% Average Coupon .......5.22469176%
TIC (Arbitrage TIC)......... 5.20170575% Average Life (yrs)... 8.69 IRS Form 8038-G NIC = 5.224692% (with Adjstmnt of $0.00).
Bond Years ..................78,232.50 WAM (yrs) .............8.687674 NIC = 5.224692% (with Adjstmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" identifies each respective term bond.
DAP 2012: OLD2004R Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 {JHR}04/30/2012 @ 14:56 v9.53
Page-14
Development Authority of Pearland, Texas
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03/01/2012 Tax Increment Contract Revenue Bonds, Delivery Date = 03/01/2012
Series 2004
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - -- - - - 48,509.38 48,509.38 48,509.38 48,509.38
03/01/2013 - -- - - - 48,509.38 48,509.38 -48,509.38
09/01/2013 - -- - - - 48,509.38 48,509.38 97,018.76 48,509.38
03/01/2014 - -- - - - 48,509.38 48,509.38 -48,509.38
09/01/2014 - -- - - - 48,509.38 48,509.38 97,018.76 1,853,509.38
03/01/2015 - -- - - - 48,509.38 48,509.38 --
09/01/2015 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2016 - -- - - - 48,509.38 48,509.38 --
09/01/2016 - -- - - - 48,509.38 48,509.38 97,018.76
03/01/2017 - -- - - - 48,509.38 48,509.38 --
09/01/2017 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2018 - -- - - - 48,509.38 48,509.38 --
09/01/2018 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2019 - -- - - - 48,509.38 48,509.38 --
09/01/2019 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2020 - -- - - - 48,509.38 48,509.38 -
09/01/2020 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2021 - -- - - - 48,509.38 48,509.38 --
09/01/2021 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2022 - -- - - - 48,509.38 48,509.38 --
09/01/2022 - -- - - - 48,509.38 48,509.38 97,018.76
03/01/2023 - -- - - - 48,509.38 48,509.38 --
09/01/2023 - -- - - - 48,509.38.48,509.38 97,018.76 -
03/01/2024 - -- - - - 48,509.38 48,509.38 --
09/01/2024 (1) 330,000.00 *330,000.00 5.375 5.375000 100.000000 48,509.38 378,509.38 427,018.76 -
03/01/2025 - -- - - - 39,640.63 39,640.63 --
09/01/2025 - (1) 345,000.00 *345,000.00 5.375 5.375000 100.000000 39,640.63 384,640.63 424,281.26 -
03/01/2026 - -- - - - 30,368.75 30,368.75 -
09/01/2026 - (1) 360,000.00 *360,000.00 5.375 5.375000 100.000000 30,368.75 390,368.75 420,737.50 -
03/01/2027 - -- - - - 20,693.75 20,693.75 --
09/01/2027 - (1) 380,000.00 *380,000.00 5.375 5.375000 100.000000 20,693.75 400,693.75 421,387.50 -
03/01/2028 - -- - - - 10,481.25 10,481.25 --
09/01/2028 1,805,000.00 (1) 390,000.00 *390,000.00 5.375 5.375000 100.000000 10,481.25 400,481.25 410,962.50 -
Total 1,805,000.00 1,805,000.00 1,805,000.00 1,415,103.26 3,220,103.26 3,220,103.26 2,047,546.90
Acc Mt - -- --
Grand Ttls 1,805,000.00 1,805,000.00 1,805,000.00 1,415,103.26 3,220,103.26 3,220,103.26 2,047,546.90
* - Bonds callable ... 09/01/2014@100.000
TIC (Incl. all expenses) .... 5.37500053% Average Coupon .......5.37500051%
TIC (Arbitrage TIC) ......... 5.37500053% Average Life (yrs)... 14.59 IRS Form 8038-G NIC = 5.375001 % (with Adjstmnt of $0.00).
Bond Years ..................26,327.50 WAM (yrs) .............14.585873 NIC = 5.375001% (with Adjstmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" identifies each respective term bond.
DAP_2012: OLD2004BR Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR)04/30/2012 @ 14:56 v9.53
Page-15
Development Authority of Pearland, Texas
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03101/2012 Tax Increment Contract Revenue Bonds,Delivery Date = 03/01/2012
Series 2005
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - 300,000.00 300,000.00 4.125 4.125000 100.000000 164,164.38 464,164.38 464,164.38 464,164.38
03/01/2013 - ---- -157,976.88 157,976.88 -157,976.88
09/01/2013 - 315,000.00 315,000.00 4.250 4.250000 100:000000 157,976.88 472,976.88 630,953.76 472,976.88
03/01/2014 - ---- -151,283.13 151,283.13 -151,283.13
09/01/2014 - 330,000.00 330,000.00 4.375 4.375000 100.000000 151,283.13 481,283.13 632,566.26 481,283.13
03/01/2015 - ---- -144,064.38 144,064.38 -144,064.38
09/01/2015 - 340,000.00 340,000.00 4.500 4.500000 100.000000 144,064.38 484,064.38 628,128.76 6,424,064.38
03/01/2016 - ---- -136,414.38 136,414.38 --
09/01/2016 - 360,000.00 *360,000.00 4.250 4.250000 100.000000 136,414.38 496,414.38 632,828.76
03/01/2017 - ---- -128,764.38 128,764.38 --
09/01/2017 - 375,000.00 *375,000.00 4.350 4.350000 100.000000 128,764.38 503,764.38 632,528.76 -
03/01/2018 - ---- -120,608.13 120,608.13 --
09/01/2018 - 390,000.00 *390,000.00 4.500 4.500000 100.000000 120,608.13 510,608.13 631,216.26
03/01/2019.- ---- -111,833.13 111,833.13 --
09/01/2019 - 390,000.00 *390,000.00 4.500 4.500000 100.000000 111,833.13 501,833.13 613,666.26 -
03/01/2020 - ---- -103,058.13 103,058.13 --
09/01/2020 - 410,000.00 *410,000.00 4.600 4.600000 100.000000 103,058.13 513,058.13 616,116.26 -
03/01/2021 - ---- -93,628.13 93,628.13 -
09/01/2021 - 425,000.00 *425,000.00 4.500 4.500000 100.000000 93,628.13 518,628.13 612,256.26 -
03/01/2022 - ---- -84,065.63 84,065.63 --
09/01/2022 - (1) 450,000.00 *450,000.00 4.625 4.625000 100.000000 84,065.63 534,065.63 618,131.26 -
03/01/2023 - ---- -73,659.38 ' 73,659.38 -
09/01/2023 - (1) 470,000.00 *470,000.00 4.625 4.625000 100.000000 73,659.38 543,659.38 617,318.76 -
03/01/2024 - ---- -62,790.63 62,790.63 --
09/01/2024 (1) 485,000.00 *485,000.00 4.625 4.625000 100.000000 62,790.63 547,790.63 610,581.26 -
03/01/2025 - - •--- -51,575.00 51,575.00 --
09/01/2025 1,915,000.00 (1) 510,000.00 *510,000.00 4.625 4.625000 100.000000 51,575.00 561,575.00 613,150.00 -
03/01/2026 - ---.- -39,781.25 39,781.25 --
09/01/2026 - (2) 530,000.00 *530,000.00 4.750 4.750000 100.000000 39,781.25 569,781.25 609,562.50 -
03/01 /2027 - ---- -27,193.75 27,193.75 --
09/01/2027 - (2) 560,000.00 *560,000.00 4.750 4.750000 100.000000 27,193.75 587,193.75 614,387.50 -
03/01/2028 - ---- -13,893.75 13,893.75 --
09/01/2028 1,675,000.00 (2) 585,000.00 *585,000.00 4.750 4.750000 100.000000 13,893.75 598,893.75 612,787.50 -
Total 3,590,000.00 7,225,000.00 7,225,000.00 3,165,344.50 10,390,344.50 10,390,344.50 8,295,813.16
Acc Int - -----
Grand Ttls 3,590 000.00 7 ,225 000.00 7,225,000.00 3,165,344.50 10 390,344.50 10,390,344.50 8,295,813.16
* - Bonds callable ... 09/01/2015@100.000
TIC (Inca. all expenses) .... 4.61808456% Average Coupon ....... 4.62786578%
TIC (Arbitrage TIC) ......... 4.61808456% Average Life (yrs)... 9.47 IRS Form 8038-G NIC = 4.627866% (with Adjstmnt of $0.00).
Bond Years ..................68,397.50 WAM (yrs) .............9.466782 NIC = 4.627866% (with Adjstmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" identifies each respective term bond.
DAP 2012: OLD2005R Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 {JHR}04/30/2012 @ 14:56 v9.53
Page-16
Page-17
I Ilnvnlnnmcnt Anthnrit y of Pnarhnrl TQv c
Page-18
Page-19
Development Authority of Pearland, Texas
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03/01/2012 Series 2009 Bonds Delivery Date = 03/01/2012
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 --- - - - 13,906.25 13,906.25 13,906.25 13,906.25
03/01/2013 --- - - - 13,906.25 13,906.25 -13,906.25
09/01/2013 -- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2014 --- - - - 13,906.25 13,906.25 -13,906.25
09/01/2014 --- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2015 --- - - - 13,906.25 13,906.25 -13,906.25
09/01/2015 --- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2016 --- - - - 13,906.25 13906.25 -13,906.25
09/01/2016 --- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2017 --- - - - 13,906.25 13,906.25 -13,906.25
09/01/2017 --- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2018 --- - - - 13,906.25 13,906.25 -13,906.25
09/01/2018 --- - - - 13,906.25 13,906.25 27;812.50 513,906.25
03/01/2019 --- - - - 13,906.25 13,906.25 --
09/01/2019 --- - - - 13,906.25 13,906.25 27,812.50
03/01/2020 --- - - - 13,906.25 13,906.25 --
09/01/2020 --- - - - 13,906.25 13,906.25 27,812.50 -
03/01/2021 --- - - - 13,906.25 13,906.25 -
09/01/2021 --- - - - 13,906.25 13,906.25 27,812.50 -
03/01/2022 --- - - 13,906.25 13,906.25 --
09/01/2022 --- - - - 13,906.25 13,906.25 27,812.50
03/01/2023 --- - - 13,906.25 13,906.25 --
09/01/2023 -- - - - 13,906.25 13,906.25 27,812.50 -
03/01/2024 --- - - - 13,906.25 13,906.25 -
09/01/2024 -250,000.00 *250,000.00 5.500 5.500000 100.000000 13,906.25 263,906.25 277,812.50 -
03/01/2025 --- - - - 7,031.25 7,031.25 --
09/01/2025 -250,000.00 `250,000.00 5.625 5.625000 100.000000 7,031.25 257,031.25 264,062.50 • -
Total -500,000.00 500,000.00 361,718.75 861,718.75 861,718.75 680,781.25
Acc Int --- ----
Grand Ttls 500 000.00 500 000.00 361 718.75 861 718.75 861 718.75 680 781.25
- Bonds callable ...09/01/2018@100.000
TIC (Intl. all expenses) .... 5.56414824% Average Coupon ....... 5.56490385%
TIC (Arbitrage TIC) ......... 5.56414824% Average Life (yrs) ... 13.00 IRS Form 8038-G NIC = 5.564904% (with Adjstmnt of $0.00).
Bond Years .................. 6,500.00 WAM (yrs) .............13.000000 NIC = 5.564904% (with Adjstmnt of $0.00).
DAP 2012: OLD2009AR Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR)04/30/2012 @ 14:57 v9.53
Page-20
Development Authority of Pearland, Texas
Proof of Federal Arbitrage Yield
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date 05/22/2012 Refundinq Issue Delivery Date 05/22/2012
Proceeds to:Interest to:Recoverable,Disc Term BAB Total PV of Adj D/S
Face Bondholder(+)Bondholder(+)Recurring Total Bond Adjstmt "Direct Pymt"Adjusted to 05/22/2012
Dates Amounts Issuer(-) Issuer(-)Fees Debt Service for Yld Calc Adjustment Cash Flow 3.07036456%
05/22/2012 0.00 -53,665,000.00 0.00 0.00 0.00 0.00 0.00 -53,665,000.00 -53,665,000.00
09/01/2012 2,375,000.00 2,375,000.00 453,066.76 0.00 2,828,066.76 0.00 0.00 2,828,066.76 2,804,468.42
03/01/2013 0.00 0.00 787,301.50 0.00 787,301.50 0.00 0.00 787,301.50 768,927.55
09/01/2013 2,405,000.00 2,405,000.00 787,301.50 0.00 3,192,301.50 0.00 0.00 3,192,301.50 3,070,659.72
03/01/2014 0.00 0.00 750,384.75 0.00 750,384.75 0.00 0.00 750,384.75 710,878.27
09/01/2014 2,475,000.00 2,475,000.00 750,384.75 0.00 3,225,384.75 0.00 0.00 3,225,384.75 3,009,374.34
03/01/2015 0.00 0.00 712,393.50 0.00 712,393.50 0.00 0.00 712,393.50 654,633.28
09/01/2015 2,555,000.00 2,555,000.00 712,393.50 0.00 3,267,393.50 0.00 0.00 3,267,393.50 2,957,079.63
03/01/2016 0.00 0.00 673,174.25 0.00 673,174.25 0.00 0.00 673,174.25 600,029.39
09/01/2016 2,630,000.00 2,630,000.00 673,174.25 0.00 3,303,174.25 0.00 0.00 3,303,174.25 2,899,746.00
03/01/2017 0.00 0.00 632,803.75 0.00 632,803.75 0.00 0.00 632,803.75 547,117.95
09/01/2017 2,715,000.00 2,715,000.00 632,803.75 0.00 3,347,803.75 0.00 0.00 3,347,803.75 2,850,725.23
03/01/2018 0.00 . 0.00 591,128.50 0.00 591,128.50 0.00 0.00 591,128.50 495,747.71
09/01/2018 2,795,000.00 2,795,000.00 591,128.50 0.00 3,386,128.50 0.00 0.00 3,386,128.50 2,796,827.60
03/01/2019 0.00 0.00 548,225.25 0.00 548,225.25 0.00 0.00 548,225.25 445,969.07
09/01/2019 2,880,000.00 2,880,000.00 548,225.25 0.00 3,428,225.25 0.00 0.00 3,428,225.25 2,746,619.54
03/01/2020 0.00 0.00 504,017.25 0.00 504,017.25 0.00 0.00 504,017.25 397,702.21
09/01/2020 2,855,000.00 2,855,000.00 504,017.25 0.00 3,359,017.25 0.00 0.00 3,359,017.25 2,610,407.36
03/01/2021 0.00 0.00 460,193.00 0.00 460,193.00 0.00 0.00 460,193.00 352,224.46
09/01/2021 2,940,000.00 2,940,000.00 460,193.00 0.00 3,400,193.00 0.00 0.00 3,400,193.00 2,563,105.69
03/01/2022 0.00 0.00 415,064.00 0.00 415,064.00 0.00 0.00 415,064.00 308,149.49
09/01/2022 3,030,000.00 3,030,000.00 415,064.00 0.00 3,445,064.00 0.00 0.00 3,445,064.00 2,518,994.01
03/01/2023 0.00 0.00 368,553.50 0.00 368,553.50 0.00 0.00 368,553.50 265,407.89
09/01/2023 3,130,000.00 3,130,000.00 368,553.50 0.00 3,498,553.50 0.00 0.00 3,498,553.50 2,481,334.16
03/01/2024 0.00 0.00 320,508.00 0.00 320,508.00 0.00 0.00 320,508.00 223,881.94
09/01/2024 3,225,000.00 3,225,000.00 320,508.00 0.00 3,545,508.00 0.00 0.00 3,545,508.00 2,439,170.16
03/01/2025 0.00 0.00 271,004.25 0.00 271,004.25 0.00 0.00 271,004.25 183,621.35
09/01/2025 3,320,000.00 3,320,000.00 271,004.25 0.00 3,591,004.25 0.00 0.00 3,591,004.25 2,396,328.99
03/01/2026 0.00 0.00 220,042.25 0.00 220,042.25 0.00 0.00 220,042.25 144,617.23
09/01/2026 3,425,000.00 3,425,000.00 220,042.25 0.00 3,645,042.25 0.00 0.00 3,645,042.25 2,359,391.36
03/01/2027 0.00 0.00 167,468.50 0.00 167,468.50 0.00 0.00 167,468.50 106,761.33
09/01/2027 3,530,000.00 3,530,000.00 167,468.50 0.00 3,697,468.50 0.00 0.00 3,697,468.50 2,321,500.57
03/01/2028 0.00 0.00 113,283.00 0.00 113,283.00 0.00 0.00 113,283.00 70,050.70
09/01/2028 3,635,000.00 3,635,000.00 113,283.00 0.00 3,748,283.00 0.00 0.00 3,748,283.00 2,282,777.48
03/01/2029 0.00 0.00 57,485.75 0.00 57,485.75 0.00 0.00 57,485.75 34,480.60
09/01/2029 3,745,000.00 3,745,000.00 57,485.75 0.00 3,802,485.75 0.00 0.00 3,802,485.75 2,246,289.34
Totals 53,665,000.00 0.00 15,639,128.76 0.00 69,304,128.76 0.00 0.00 15,639,128.76 0.00
Plus PV of Bond Insurance ..........0.00
0.00
DAP_2012: NEWI2REF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:57 v9.53
Page-21
Development Authority of Pearland, Texas
Current Debt plus New Debt
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date 0 512 2/2 01 2 New Money Portion Delivery Date 05/22/2012
New Interest Interest
Year Current Principal @ 3.070%@ 3.070%Total Total New Total Debt
Ending Debt Due Due Due New Principal Service
09/29 Requirement 09101 03/01 09/01 Interest & Interest Requirement
2012 3,978,246 305,000 27,438 27,438 332,438 4,310,684
2013 3,979,603 315,000 45,206 45,206 90,412 405,412 4,385,015
2014 3,975,770 325,000 40,371 40,371 80,741 405,741 4,381,511
2015 3,979,787 330,000 35,382 35,382 70,764 400,764 4,380,551
2016 3,976,349 340,000 30,316 30,316 60,633 400,633 4,376,981
2017 3,980,608 355,000 25,097 25,097 50,195 405,195 4,385,802
2018 3,977,257 365,000 19,648 19,648 39,296 404,296 4,381,553
2019 3,976,451 375,000 14,045 14,045 '28,091 403,091 4,379,541
2020 3,863,035 265,000 8,289 8;289 16,578 281,578 4,144,613
2021 3,860,386 275,000 4,221 4,221 8,443 283,443 4,143,829
2022 3,860,128 3,860,128
2023 3,867,107 3,867,107
2024 3,866,016 3,866,016
2025 3,862,009 3,862,009
2026 3,865,085 3,865,085
2027 3,864,937 3,864,937
2028 3,861,566 3,861,566
2029 3,859,972 3,859,972
Totals $70,454,312 $3,250,000 $222,575 $250,013 $472,591 $3,722,591 $74,176,900
NEW12: Dated Date: 05/22/2012 Principal Due Dates: 09/0112012 - 09/01/2021 Maturing Amount: 3,250,000.00
DAP 2012: NEW12 AGGPOSTREF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:57 v9.53
Page-22
Page-23
Development Authority of Pearland, Texas
Proof of Federal Arbitrage Yield
FINAL NUMBERS- Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date 05/22/2012 New Money Portion Delivery Date 05/22/2012
Proceeds to:Interest to:Recoverable,Disc Term BAB Total PV of Adj DIS
Face Bondholder(+)Bondholder(+)Recurring Total Bond Adjstmt "Direct Pymt"Adjusted to 05/2212012
Dates Amounts Issuer(-) Issuer l-)Fees Debt Service for Yld Cale Adjustment Cash Flow 3.07067136%
05/22/2012 0.00 -3,250,000.00 0.00 0.00 0.00 0.00 0.00 -3,250,000.00 -3,250,000.00
09/01/2012 305,000.00 305,000.00 27,438.13 0.00 332,438.13 0.00 0.00 332,438.13 329,663.88
03/01/2013 0.00 0.00 45,205.75 0.00 45,205.75 0.00 0.00 45,205.75 44,150.64
09/01/2013 315,000.00 315,000.00 45,205.75 0.00 360,205.75 0.00 0.00 360,205.75 346,478.87
03/01/2014 0.00 0.00 40,370.50 0.00 40,370.50 0.00 0.00 40,370.50 38,244.86
09/01/2014 325,000.00 325,000.00.40,370.50 0.00 365,370.50 0.00 0.00 365,370.50 340,898.57
03/01/2015 0.00 0.00.35,381.75 0.00 35,381.75 0.00 0.00 35,381.75 32,512.76
09/01/2015 330,000.00 330,000.00 35,381.75 0.00 365,381.75 0.00 0.00 365,381.75 330,677.11
03/01/2016 0.00 0.00 30,316.25 0.00 30,316.25 0.00 0.00 30,316.25 27,021.88
09/01/2016 340,000.00 340,000.00 30,316.25 0.00 370,316.25 0.00 0.00 370,316.25 325,084.03
03/01/2017 0.00 0.00 25,097.25 0.00 25,097.25 0.00 0.00 25,097.25 21,698.60
09/01/2017 355,000.00 355,000.00 25,097.25 0.00 380,097.25 0.00 0.00 380,097.25 323,655.64
03/01/2018 0.00 0.00 19,648.00 0.00 19,648.00 0.00 0.00 19,648.00 16,477.43
09/01/2018 365,000.00 365,000.00 19,648.00 0.00 384,648.00 0.00 0.00 384,648.00 317,700.21
03/01/2019 0.00 0.00 14,045.25 0.00 14,045.25 0.00 0.00 14,045.25 11,425.27
09/01/2019 375,000.00 375,000.00 14,045.25 0.00 389,045.25 0.00 0.00 389,045.25 311,687.74
03/01/2020 0.00 0.00 8,289.00 0.00 8,289.00 0.00 0.00 8,289.00'6,540.40
09/01/2020 265,000.00 265,000.00 8,289.00 0.00 273,289.00 0.00 0.00 273,289.00 212,376.93
03/01/2021 0.00 0.00 4,221.25 0.00 4,221.25 0.00 0.00 4,221.25 3,230.79
09/01/2021 275,000.00 275,000.00 4,221.25 0.00 279,221.25 0.00 0.00 279,221.25 210,474.38
Totals 3,250,000.00 0.00 472,588.13 0.00 3,722,588.13 0.00 0.00 472,588.13 0.00
Plus PV of Bond Insurance ..........0.00
0.00
DAP 2012: NEWI 2 Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 04/30/2012 @ 14:58 v9.53
Page-24
United States of America
State of Texas
Number Registered
I-1 $56,915,000
DEVELOPMENT AUTHORITY OF PEARLAND
TAX INCREMENT CONTRACT REVENUE AND REFUNDING BOND
SERIES 2012
DATED DATE: May 1, 2012
REGISTERED OWNER: CAPITAL ONE PUBLIC FUNDING, LLC
PRINCIPAL AMOUNT: FIFTY SIX MILLION NINE HUNDRED FI^'.TEEN TI- OUSAND
AND NO/100 DOLLARS
The DEVELOPMENT AUTHORITY OF PEARLAND (the "Authority"), a not-for-profit
local government corporation created by the.. City-of PeaTland (the "City"), in the Counties of
Brazoria and Fort Bend, in the State of. Texas; for='value received, promises to pay, but solely
from certain Pledged Revenues as hereinafter'pfvided, to the Registered Owner identified
above or registered assigns, on the Maturity Date specified above, upon presentation and
surrender of t1iis Series 2012-Bond at the designated office of the Paying Agent/Registrar (the
"Paying Agen - Regi ixar")initially, Regions Bank, the principal amount identified above,
such principal is legal fender for the payment of debts due the United States of America, and to
pay, solely fromuch Pledged Revenues, interest thereon to be paid as described herein,
calculated on the basis of a 360-day year of twelve 30-day months, from the later of the date of
delivery to the Purchaser, or the most recent interest payment date to which interest has been
paid or duly provided for. Interest on this Series 2012 Bond is payable by check on March 1 and
September 1, be ginnin g on September 1, 2012, mailed to the Registered Owner as shown on the
books of registration kept by the Paying Agent/Registrar as of the fifteenth (15th) calendar day
of the month next preceding each interest paymeizt date, or by such other method, acceptable to
the Paying Agent/Registrar, requested by and at the risk and expense of the Registered Owner.
THIS SERIES 2012 BOND shall be subject to mandatory sinking fund redemption in
installments according the following schedule:
Principal Maturity Date Interest
Amount September 1 Rate
$2,680,000 2012 3.07
2,720,000 2013 3.07
2,800,000 2014 3.07
2,885,000 2015 3.07
2,970,000 2016 3.07
3,070,000 2017 3.07
3,160,000 2018 3.07
3,255,000 2019 3.07
Page 1 of 6
3,120,000 2020 3.07
3,215,000 2021 3.07
3,030,000 2022 3.07
3,130,000 2023 3.07
3,225,000 2024 3.07
3,320,000 2025 3.07
3,425,000 2026 3.07
3,530,000 2027 3.07
3,635,000 2028 3.07
3,745,000 2029 3.07
THE SERIES 2012 BONDS AND ALL PARITY BONDS AR,, MITE*OBI.,TGATIONS
OF THE AUTHORITY, PAYABLE SOLELY OUT OF THE PLEDGED REVENUE$, WHICH IS
THE SOLE ASSET OF THE AUTHORITY PLEDGED THERFa#•QR. T-HE'SERIES" 2012 BONDS
ARE OBLIGATIONS SOLELY OF THE AUTHORITY A P n . CONS' ITUTE, WITHIN
THE MEANING OF ANY STATUTORY OR CONSTITUTIONAL + PROVISION, AN
INDEBTEDNESS, AN OBLIGATION OR A LOAN 1T,CREIITOF THE CITY OF PEARLAND,
THE STATE OF TEXAS, ALVIN INDEPEN SCIrIOOL IIST1JCT, BRAZORIA COUNTY,
FORT BEND COUNTY OR ANY OT R ' MUNICIPA •ITY, COUNTY, OR OTHER
MUNICIPAL OR POLITICAL CORP ATI ORUBD1VISION OF THE STATE OF TEXAS.
NEITHER THE CITY OF PE I ND, 1 I INDEPENDENT SCHOOL DISTRICT, rte. r :
BRAZORIA COUNTY NOR FORT: ETI COUT^TTY IS OBLIGATED TO MAKE PAYMENTS
ON THE SERIES 2012 BO,w. ,
Jf=
THIS SERI .;:W2 BQvtF IS ONE OF A DULY AUTHORIZED SERIES OF SERIES 2012
BONDS aggregag .F 915000 issued for the purpose of (1) paying Project Costs, (2)
refunding the Ref lfndsi and (3) paying costs of issuance, all under and pursuant to the
authority of the Act aftd Il other applicable laws, and a resolution adopted by the Authority on
April 30, 2012 (the "Resolution"). None of the proceeds of the Series 2012 Bonds shall be used
for the purpose of paying or otherwise providing for educational facilities. Terms not otherwise
defined herein shall have the meaning ascribed thereto in the Resolution
THIS BOND shall accrue interest from the date of delivery until, but not including, May
22, 2022, at a rate of 3.07% per annum. Beginning May 22, 2022, the interest rate shall reset on
each Adjustment Date to the Applicable Rate for the corresponding Variable Rate Period with
the first such Adjustment Date being May 22, 2022, until the date of final maturity or
prepayment prior to maturity.
THIS SERIES 2012 BOND AND THE SERIES OF WHICH IT IS A PART are limited
obligations of the Authority that are together with all other Parity Bonds heretofore or hereafter
issued under the Indenture described below, payable from, and are equally and ratably secured
by a lien on the Pledged Revenues, which include the Contract Tax Increments, moneys on
deposit in the Pledged Revenue Fund, the Debt Service Fund, and interest earned on moneys
deposited therein, as defined and more fully provided in the Indenture of Trust dated as of May
1, 2012, between the Authority and Regions Bank, as Trustee (the "Indenture"). This Series 2012
Page 2 of 6
Bond and the series of which it is a part and all other Parity Bonds, together with the interest
thereon, are payable solely from such Pledged Revenues.
THE AUTHORITY RESERVES THE RIGHT during the Fixed Rate Period, at its option,
to redeem in whole or in part the Series 2012 Bonds on any date, at par plus accrued interest on
the amounts called for redemption to the date fixed for redemption.
THE AUTHORITY RESERVES THE RIGHT during any Variable Rate Period, at its
option, to redeem in whole or in part the Series 2012 Bonds on the final day of any Variable Rate
Period, at par plus accrued interest on the amounts called for redemption to the date fixed for
redemption. Also, during any Variable Rate Period, the Authority reserves the right, at its
option; to redeem in whole or in part the Series 2012 Bonds on any date other than the final date
of any Variable Rate Period, at par plus accrued interest on the amounts called for redemption
to the date fixed for redemption, plus payment of the cost, if any, as,.reasonably determined by
the Purchaser, resulting from the breakage of any LIBOR contrac(of the. Purchasgr:.`associated
with the Series 2012 Bonds for such Variable Rate Period : ^'`
UNLESS WAIVED BY THE OWNER, NOTICE OF ANY RED`EV;iYMPT1ON shall be given
at least thirty (30) days prior to the date fixe&''for redemption rby-`first class mail, addressed to
the Registered Owners of each Series X012 Bond tei^?be redeemed in whole or in part at the
address shown on the books of registrati .:kept by the Paying Agent/Registrar. Such notices
shall state the redemption date, the redemption price, the place at which Series 2012 Bonds are
to be surrey dere.d for payment and y1i less than all Series 2012 Bonds Outstanding of a particular
maturity a'o.beredeemed, the numbers of the Series 2012 Bonds or portions thereof of such
maturity to be re4een1el. When Series 2012 Bonds or portions thereof have been called for
redemption, ar ue provision has been made to redeem the same, the principal amounts so
redeemed shall be payable solely from the funds provided for redemption, and interest which
would otherwise accrue on the amounts called for redemption shall terminate on the date fixed
for redemption.
THIS SERIES 2012 BOND IS TRANSFERABLE only upon presentation and surrender at
the designated office of the Paying Agent/Registrar, duly endorsed for transfer or accompanied
by an assignment duly executed by the Registered Owner or his authorized representative,
subject to the terms and conditions of the Resolution.
THIS SERIES 2012 BOND IS EXCHANGEABLE at the designated office of the Paying
Agent/Registrar for Series 2012 Bonds in the principal amount of $5,000 or any integral
multiple thereof, subject to the terms and conditions of the Resolution.
NEITHER THE AUTHORITY NOR THE PAYING AGENT/REGISTRAR shall be
required to transfer or exchange any Series 2012 Bond during the period beginning on the
fifteenth calendar day of the month next preceding any interest payment date and ending on
such interest payment date or to transfer any Series 2012 Bond called for redemption during the
30 day period prior to the redemption date.
THIS SERIES 2012 BOND shall not be valid or obligatory for any purpose or be entitled
to any benefit under the Resolution unless this Series 2012 Bond is either (i) registered by the
Comptroller of Public Accounts of the State of Texas by registration certificate attached or
Page 3 of 6
affixed hereto or (ii) authenticated by the Paying Agent/Registrar by due execution of the
authentication certificate endorsed hereon.
THE AUTHORITY HAS RESERVED THE RIGHT to issue Additional Parity Bonds,
subject to the restrictions contained in the Resolution and the Indenture, which may be equally
and ratably payable from, and secured by a lien on and pledge of, the Pledged Revenues in the
same manner and to the same extent as the Parity Bonds and this Series 2012 Bond and the
series of which it is a part..
IT IS HEREBY DECLARED AND REPRESENTED that this Series, 20 ,pond has been
' duly and validly issued and delivered; that all acts, conditions, and t imgquire'Ei or proper to
be performed, exist, and be done precedent to or in the issuanc e delivery of this Series 2012
Bond have been performed, existed, and been done in acco ianc th'law; "that the Series 2012
Bonds do not exceed any statutory limitation; andw:thatprovsion.hs been made for the
payment of the principal of and interest on this eries;2012 Bond and all of the Parity Bonds by
the creation of the aforesaid lien on and pledge of the .Pledged Revenues as provided in the
Indenture. ?y _
IN WITNESS WHEREOIthe Authori " _ has caused this Series 2012 Bond to be executed
by the manual or facsimile signatures of thCiiair and Director.
DEVELOPMENT AUTHORITY OF
PEARLAND
Chair, Board of Directors
Director, Board of Directors
Page 4 of 6
(SEAL)
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.
I hereby certify that this Series 2012 Bond has been examined, certified as to validity, and
approved by the Attorney General of the State of Texas, and that this Series 2012 Bond has been
registered by the Comptroller of Public Accounts of the State of Texas.
WITNESS MY SIGNATURE AND SEAL this n MAY .
Page 5 of 6
Assignment
For value received, the undersigned hereby sells, assigns, and transfers unto
(Please print or. type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Tra tree '' k
the within Series 2012 Bond and all rights thereunder, and hereby t g y lxxvocaUly`;corisfii't rtes and
appoints
attorney to transfer said Series 2012 Bond on the books pt %tr'registration thereof, with full
power of substitution in the premises.
DATED_________________
Signature Guaranteed:
skims— Registered Owner
NOTICE: Signa r _ , must be guaranteed by NOTICE: The signature above must
an institution whx is a participant in the correspond to the name of the Registered
Securities Transfer Agent Medallion Program Owner as shown on the face of this Bond in
("STAMP") or similar program. every particular, without any alteration,
enlargement or change whatsoever.
Page 6 of 6
Houston Overnight
Date: Signature
TO FROM DESCRIPTION # OF PCS
Total # of
packages:
HOU:3219689.1
Development Authority of Pearland
$56,915,000 Tax Increment Contract Revenue
and Refunding Bonds, Series 2012
1. Approving Opinion of Co-Bond Counsel
2. Investment Letter
3. Escrow Agreement
4. Verification Report of Grant Thornton LLP
5. Certificate of Escrow Agent
6. Notice of Redemption Letter – Wells Fargo Bank, N.A.
7. Certificate of Paying Agent
8. Indenture of Trust
9. City Resolution Authorizing the Issuer to Issue the Bonds
10. Certified Copy of Issuer Resolution Authorizing the Issuance of the Bonds
11. General Certificate of Issuer
12. General Certificate of City
13. Certificate of Coverage
14. Signature Identification and No-Litigation Certificate
15. Attorney General’s Opinion and Comptroller’s Registration Certificate
16. Federal Tax Certificate and IRS Form 8038-G
17. Paying Agent/Registrar Agreement
18. Paying Agent/Registrar Receipt
19. Opinion of City Attorney
20. Opinion of Trustees’ Counsel
21. Escrow Agent’s Receipt for Documents, Securities, and Funds
HOU:3219689.1
22. Closing Certificate
23. Closing Memorandum, Instruction Letter from Authority to Well Fargo
Bank, N.A. and Final Numbers
24. Specimen Bond
Cash Flow and Yield Verification Report
Development Authority of Pearland, Texas
May 22, 2012
Contents
Letter
Exhibit A Schedule of Sources and Uses of Funds
Exhibit 8 Escrow Account Cash Flow
Exhibit B-1 Cash Receipts From and Yield on the Open-Market Securities
Exhibit B-2 Purchase Price of the Open-Market Securities
Exhibit B-3 Debt Service Payments on the 2004 Bonds
Exhibit B-4 Debt Service Payments on the 2005 Bonds
Exhibit B-5 Debt Service Payments on the 2006 Bonds
Exhibit B-6 Debt Service Payments on the 2007 Bonds
Exhibit B-7 Debt Service Payments on the 2009 Bonds
Exhibit C Debt Service Payments and Yield on the Bonds
Appendix I Applicable schedules provided by BOSC, Inc.
Grantlhornton
Report of Independent Certified Public Accountants
On Applying Agreed-Upon Procedures
Development Authority of Pearland
c/o the City of Pearland
3519 Liberty Drive
Pearland, Texas
Andrews Kurth LLP
1717 Main Street, Suite 3700
Dallas, Texas
Audit • Tax • Advisory
Grant Thornton LLP
200 S 6th Street, Suite 500
Minneapolis, MN 55402-1459
T 612.332.0001
F 612.332.8361
www. GrantThornton.com
Allen Boone I-Iumphries Robinson LLP
3200 Southwest Fwy., Suite 2600
Houston, Texas
BOSC, Inc.
1401 McKinney Street, Suite 1650
Houston, Texas
Regions Bank
4400 Post Oak Parkway
Houston, Texas
Texas Attorney General's Office
300 West 15 th Street, Seventh Floor
Austin, Texas
$56,915,000
Development Authority of Pearland, Texas
Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated May 22, 2012
We have performed the procedures described in this report, which were agreed to by the
Development Authority of Pearland, Texas (the "Authority") and BOSC, Inc. (the "Financial
Advisor"), to verify the mathematical accuracy of certain computations contained in the
schedules attached in Appendix I provided by the Financial Advisor. The Financial Advisor is
responsible for these schedules. These procedures were performed solely to assist you in the
issuance of the above-captioned bond issue (the "Bonds") for the purpose of refunding the
Authority's outstanding Tax Increment Contract Revenue Bonds, Series 2004 (the "2004
Bonds"), Tax Increment Contract Revenue Bonds, Series 2005 (the "2005 Bonds"), Tax
Increment Contract Revenue Bonds, Series 2006 (the "2006 Bonds"), Tax Increment Contract
Revenue Bonds, Series 2007 (the "2007 Bonds") and Tax Increment Contract Revenue Bonds,
Series 2009 (the "2009 Bonds") (collectively referred to as the "Refunded Bonds") as
summarized on the next page. This engagement was performed in accordance with Statements
on Standards for Attestation Engagements established by the American Institute of Certified
Public Accountants. The sufficiency of these procedures is solely the responsibility of the
addressees of this report who are the specified parties. Consequently, we make no
representation regarding the sufficiency of the procedures described in this report either for the
purpose for which this report has been requested or for any other purpose.
Grant Thornton LLP
U.S. member firm of Grant Thornton International Ltd
Page 2
Principal Principal Maturities Redemption Redemption
Series Issued Dated Refunded Refunded Date Price
9-1-12 to
9-1-16, 9-1-19,
9-1-21, 9-1-23
2004 $13,995,000 December 1, 2004 $10,810,000 and 9-1-28 9-1-14 100%
9-1-12 to
9-1-21,9-1-25
2005 $9,775,000 October 1, 2005 $7,225,000 and 9-1-28 9-1-15 100%
9-1-12 to
9-1-26 and
2006 $9,970,000 October 1, 2006 $8,570,000 9-1-28 9-1-16 100%
9-1-12 to
9-1-27 and
2007 $15,950,000 October 1, 2007 $14,415,000 9-1-29 9-1-12 100%
9-1-12 to
9-1-23, 9-1-26,
9-1-27 and
2009 $8,815,000 June 1, 2009 $8,210,000 9-1-29 9-1-18 100%
VERIFICATION OF ESCROW ACCOUNT CASH FLOW SUFFICIENCY
The Financial Advisor provided us with schedules (Appendix I) summarizing future escrow
account cash receipts and disbursements. These schedules indicate that there will be sufficient
cash available in the escrow account to pay the principal and interest on the Refunded Bonds
assuming the 2004 Bonds maturing on and after September 1, 2015 will be redeemed on
September 1, 2014 at 100 percent of par plus accrued interest, the 2005 Bonds maturing on and
after September 1, 2016 will be redeemed on September 1, 2015 at 100 percent of par plus
accrued interest, the 2006 Bonds maturing on and after September 1, 2017 will be redeemed on
September 1, 2016 at 100 percent of par plus accrued interest, the 2007 Bonds maturing on and
after September 1, 2013 will be redeemed on September 1, 2012 at 100 percent of par plus
accrued interest, and the 2009 Bonds maturing on and after September 1, 2019 will be
redeemed on September 1, 2018 at 100 percent of par plus accrued interest.
The attached Exhibit A (Schedule of Sources and Uses of Funds) was compiled based upon
information provided by the Financial Advisor.
As part of our engagement to recalculate the schedules attached as Appendix I we prepared
schedules attached hereto as Exhibits B through B-7 independently calculating future escrow
account cash receipts and disbursements and compared the information used in our
calculations to the information listed below contained in applicable pages of the following
documents:
• Trade confirmations provided by the Financial Advisor used to acquire certain United
States Treasury Notes (the "T-Notes"), Federal Home Loan Bank Notes (the
"FHLB"), Federal National Mortgage Associates Strips and Notes (collectively, the
"FNMA"), and Federal Home Loan Mortgage Corporation Notes (the "FHLMC")
(collectively referred to as the "Open-Market Securities") insofar as the Open-Market
Securities are described as to the principal amounts, interest rates, purchase prices and
maturity dates; and
• Resolutions for the Refunded Bonds and Official Statements for the 2005 Bonds and
the 2009 Bonds provided by the Financial Advisor insofar as the Refunded Bonds are
described as to the maturity and interest payment dates, principal amounts, interest
rates and optional redemption dates and price.
Page 3
Our procedures, as summarized in Exhibits B through B-7, prove the mathematical accuracy of
the schedules provided by the Financial Advisor summarizing future escrow account cash
receipts and disbursements. The schedules provided by the Financial Advisor and those
prepared by us reflect that the anticipated receipts from the Open-Market Securities, together
with an initial cash deposit of $145.78 to be deposited into the escrow account on May 22,
2012, will be sufficient to pay, when due, the principal and interest related to the Refunded
Bonds assuming the 2004 Bonds maturing on and after September 1, 2015 will be redeemed on
September 1, 2014 at 100 percent of par plus accrued interest, the 2005 Bonds maturing on and
after September 1, 2016 will be redeemed on September 1, 2015 at 100 percent of par plus
accrued interest, the 2006 Bonds maturing on and after September 1, 2017 will be redeemed on
September 1, 2016 at 100 percent of par plus accrued interest, the 2007 Bonds maturing on and
after September 1, 2013 will be redeemed on September 1, 2012 at 100 percent of par plus
accrued interest, and the 2009 Bonds maturing on and after September 1, 2019 will be
redeemed on September 1, 2018 at 100 percent of par plus accrued interest.
VERIFICATION OF YIELDS
The Financial Advisor provided us with schedules (Appendix I) which indicate that the yield on
the cash receipts from the Open-Market Securities is less than the yields on the Bonds for the•
yield period beginning on May 22, 2012 and ending on May 22, 2017 (the "First Yield Period")
and the Bonds for the yield period beginning on May 22, 2017 and ending on May 22, 2022 (the
"Second Yield Period"). These schedules were prepared based on the assumed settlement date
of May 22, 2012 using a 360-day year with interest compounded semi-annually. The term
"yield", as used herein, means that yield which, when used in computing the present value of all
payments of principal and interest to be paid or received on an obligation produces an amount
equal to, in the case of the cash receipts from the Open-Market Securities, the purchase price,
and in the case of the Bonds, the issue price. Our engagement with respect to the computation
of the yields on the Bonds consists of computing a bond yield for the First Yield Period and
the Second Yield Period. In this report, we have defined the bond yields thus computed as the
"Bond Yield for the First.Yield Period" and the "Bond Yield for the Second Yield.Period".
As part of our engagement to recalculate the schedules attached as Appendix I we prepared
schedules attached hereto as Exhibits B-1 and C independently calculating the yields on (i) the
cash receipts from the Open-Market Securities calculated on Exhibit B-1, and (ii) the Yield on
the Bonds for the First Yield Period and the Second Yield Period using the Resolution
provided by the Financial Advisor insofar as the Bonds are described as to the maturity and
interest payment dates, dated date, principal amounts and interest rates. The Financial Advisor
provided us with the issue price to the public. The results of our calculations, based on the
aforementioned assumptions, are summarized below:
Yield Exhibit
• Yield on the cash receipts from the
Open-Market Securities 0.828451% B-1
• Bond Yield for the First Yield Period 3.071183% C
• Bond Yield for the Second Yield Period 3.071199% C
Our procedures, as summarized in Exhibits B-1 and C, prove the mathematical accuracy of the
schedules provided by the Financial Advisor summarizing the yields. The schedules provided
by the Financial Advisor and those prepared by us reflect that the yield on the cash receipts
from the Open-Market Securities is less than the Yield on the Bonds for the First Yield Period
and the Second Yield Period.
Page 4
We were not engaged to, and did not, perform an examination or a review in accordance with
Statements on Standards for Attestation Engagements established by the American Institute of
Certified Public Accountants, the objective of which would be the expression of an
examination opinion or limited assurance on the items referred to above. Accordingly we do
not express such an opinion or limited assurance. Had we performed additional procedures,
other matters might have come to our attention that would have been reported to you.
This report is intended solely for the information and use of those to whom this letter is
addressed and is not intended to be and should not be used by anyone other than these
specified parties.
TL -t P
Minneapolis, Minnesota
May 22, 2012
Exhibit A
Development Authority of Pearland, Texas
SCHEDULE OF SOURCES AND USES OF FUNDS
May 22, 2012
SOURCES:
Principal amount of the Bonds $56,915,000.00
Issuer Contribution of Reserve Fund 1,374,330.00
$58,289,330.00
USES:
Purchase price of the Open-Market Securities
Beginning cash deposit to the escrow account
New Money proceeds
Costs of issuance
Contingency
$54,746,584.46
145.78
3,250,000.00
289,500.00
3,099.76
$58,289,330.00
Exhibit B
Page 1 of 2
Development Authority of Pearland, Texas
ESCROW ACCOUNT CASH FLOW
Dates
Cash deposit on
May 22, 2012
07-17-12
08-20-12
08-25-12
• 08-27-12
08-28-12
08-31-12
09-01-12
01-17-13
02-20-13
02-25-13
02-27-13
02-28-13
03-01-13
07-15-13
07-17-13
08-20-13
08-25-13
08-27-13
08-28-13
09-01-13
01-17-1.4
02-25-14
02-27-14
02-28-14
03-01-14
07-17-14
08-25-14
08-28-14
09-01-14
01-17-15
02-06-15
02-25-15
Cash
receipts from
Open-Market
Securities
(Exhibit B-1)
$115,303.13
11,512.50
55,320.00
12,790.63
50,623.13
16,737,323.75
115,303.13
11,512.50
55,320.00
567,790.63
50,623.13
200,000.00
115,303.13
1,853,512.50
55,320.00
3,425.00.
50,623.13
115,303.13
55,320.00
551,425.00
50,623.13
115,303.13
55,320.00
11,621,623.13
115,303.13
322,000.00
55,320.00
Debt service
payments on
Refunded Bonds
(Exhibits B-3
through B-7)
$16,980,178.75
803,058.75
2,278,058.75
772,251.25
11,792,251.25
Cash
balance
$145.78
115,448.91
126,961.41
182,281.41
195,072.04
245,695.17
16,983,018.92
2,840.17
118,143.30
129,655.80
184,975.80
752,766.43
803,389.56
330.81
200,330.81
315,633.94
2,169,146.44
2,224,466.44
2,227,891.44
2,278,514.57
455.82
115,758.95
171,078.95
722,503.95
773,127.08
875.83
116,178.96
171,498.96
11,793,122.09
870.84
116,173.97
438,173.97
493,493.97
Exhibit B
Page 2 of 2
Development Authority of Pearland, Texas
ESCROW ACCOUNT CASH FLOW
Cash Debt service
receipts from payments on
Open-Market Refunded Bonds
Securities (Exhibits B-3 Cash
Dates (Exhibit B-1)through B-7)balance
03-01-15 493,455.00 38.97
07-15-15 86,000.00 86,038.97
07-17-15 5,386,303.13 5,472,342.10
08-06-15 1,863,000.00 7,335,342.10
08-12-15 158,000.00 7,493,342.10
08-25-15 55,320.00 7,548,662.10
09-01-15 7,548,455.00 207.10
02-06-16 278,000.00 278,207.10
02-25-16 55,320.00 333,527.10
03-01-16 333,015.63 511.47
07-15-16 218,000.00 218,511.47
08-06-16 1,863,000.00 2,081,511.47
08-25-16 5,587,320.00 7,668,831.47
09-01-16 7,668,015.63 815.84
02-06-17 177,000.00 177,815.84
03-01-17 177,153.75 662.09
08-06-17 562,000.00 562,662.09
09-01-17 562,153.75 508.34
02-06-18 168,000.00 168,508.34
03-01-18 168,250.63 257.71
07-15-18 4,435,000.00 4,435,257.71
08-06-18 1,863,000.00 6,298,257.71
09-01-18 6,298,250.63 7.08
$55,874,410.07 $55,874,548.77
Exhibit B-1
Page 1 of 2
Development Authority of Pearland, Texas
CASH RECEIPTS FROM AND YIELD ON THE OPEN -MARKET SECURITIES
Cash Present value on
receipts from May 22, 2012
Receipt Interest Open-Market using a yield of
date Principal rate Interest Securities 0.828451%
07-17-12 $115,303.13 $115,303.13 $115,157.59
08-20-12 11,512.50 11,512.50 11,489.26
08-25-12 55,320.00 55,320.00 55,201.98
08-27-12 12,790.63 12,790.63 12,762.76
08-28-12 50,623.13 50,623.13 50,511.65
08-31-12 $16,706,000 0.375%31,323.75 16,737,323.75 16,699,314.10
01-17-13 115,303.13 115,303.13 114,682.54
02-20-13 11,512.50 11,512.50 11,441.86
02-25-13 55,320.00 55,320.00 54,974.26
02-27-13 555,000 3.375%12,790.63 567,790.63 564,216.12
02-28-13 50,623.13 50,623.13 50,303.28
07-15-13 200,000 0.000%200,000.00 198,112.06.
07-17-13 -115,303.13 115,303.13 114,209.46
08-20-13 1,842,000 1.250%11,512.50 1,853,512.50 1,834,540.74
08-25-13 55,320.00 55,320.00 54,747.48
08-27-13 3,425.00 3,425.00 3,389.40
08-28-13 50,623.13 50,623.13 50,095.77
01-17-14 115,303.13 115,303.13 113,738.32
02-25-14 55,320.00 55,320.00 54,521.64
02-27-14 548,000 1.250%3,425.00 551,425.00 543,442.05
02-28-14 50,623.13 50,623.13 49,889.12
07-17-14 115,303.13 115,303.13 1.13,269.13
08-25-14 55,320.00 55,320.00 54,296.73
08-28-14 11,571,000 0.875%50,623.13 11,621,623.13 11,405,868.39
01-17-15 115,303.13 115,303.13 112,801.88
02-06-15 322,000 0.000%322,000:00 314,877.49
02-25-15 55,320.00 55,320.00 54,072.75
07-15-15 86,000 0.000%86,000.00 83,791.20
07-17-15 5,271,000 4.375%115,303.13 5,386,303.13 5,247,721.65
08-06-15 1,863,000 0.000%1,863,000.00 1,814,276.01
08-12-15 158,000 0.000%158,000.00 153,846.55
08-25-15 55,320.00 55,320.00 53,849.69
02-06-16 278,000 0.000%278,000.00 269,612.52
02-25-16 55,320.00 55,320.00 53,627.55
07-15-16 218,000 0.000%218,000.00 210,652.18
08-06-16 1,863,000 0.000%1,863,000.00 1,799,338.50
Exhibit B-1
Page 2 of 2
Development Authority of Pearland, Texas
CASH RECEIPTS FROM AND YIELD ON THE OPEN -MARKET SECURITIES
Cash Present value on
receipts from May 22, 2012
Receipt Interest Open-Market using a yield of
date Principal rate Interest Securities 0.828451%
08-25-16 5,532,000 2.000% 55,320.00 5,587,320.00 5,394,038.79
02-06-17 177,000 0.000%177,000.00 170,246.44
08-06-17 562,000 0.000%562,000.00 538,326.61
02-06-18 168,000 0.000%168,000.00 160,259.42
07-15-18 4,435,000 0.000%4,435,000.00 4,215,238.16
08-06-18 1,863,000 0.000%1,863,000.00 1,769,831.43
$54,218,000 $1,656,410.07 $55,874,410.07 $54,746,584.46
Purchase price of the Open-Market Securities $54,746,584.46
The sum of the present values of the cash receipts from the Open-Market Securities on May 22, 2012,
using a yield of 0.828451%, is equal to the purchase price of the Open-Market Securities.
Exhibit B-2
Development Authority of Pearland, Texas
PURCHASE PRICE OF THE OPEN-MARKET SECURITIES
Maturity Principal Interest Accrued Purchase
Type date amount rate Price Cost interest price
T-Notes 08-31-12 $16,706,000 0.375%100.097420%$16,722,274.99 $14,129.74 $16,736,404.73
FHLB 02-27-13 555,000 3.375%102.461050%568,658.83 4,422.66 573,081.49
FNMA 07-15-13 200,000 0.000%99.748000%199,496.00 199,496.00
FNMA 08-20-13 1,842,000 1.250%101.309330%1,866,117.86 5,884.17 1,872,002.03
FNMA 02-27-14 548,000 1.250%101.758810%557,638.28 1,617.36 559,255.64
FNMA 08-28-14 11,571,000 0.875%101.297860%11,721,175.38 23,624.13 11,744,799.51
FNMA 02-06-15 322,000 0.000%99.058000%318,966.76 318,966.76
FNMA 07-15-15 86,000 0.000%98.595000%84,791.70 84,791.70
FHLMC 07-17-15 5,271,000 4.375%111.938520%5,900,279.39 80,071.61 5,980,351.00
FNMA 08-06-15 1,863,000 0.000%98.255000%1,830,490.65 1,830,490.65
FNMA 08-12-15 158,000 0.000%98.246000%155,228.68 155,228.68
FNMA 02-06-16 278,000 0.000%97.624000%271,394.72 271,394.72
FNMA 07-15-16 218,000 0.000%96.943000%211,335.74 211,335.74
FNMA 08-06-16 1,863,000 0.000%96.941000%1,806,010.83 1,806,010.83
FHLMC 08-25-16 5,532,000 2.000%105.185640%5,818,869.60 26,738.00 5,845,607.60
FNMA 02-06-17 177,000 0.000%95.638000%169,279.26 169,279.26
FNMA 08-06-17 562,000 0.000%94.205000%529,432.10 529,432.10
FNMA 02-06-18 168,000 0.000%93.402000%156,915.36 156,915.36
FNMA 07-15-18 4,435,000 0.000%90.558000%4,016,247.30 4,016,247.30
FNMA 08-06-18 1,863,000 0.000%90.472000%1,685,493.36 1,685,493.36
$54,218,000 $54,590,096.79 $156,487.67 $54,746,584.46
Exhibit B-3
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS ON THE 2004 BONDS
Interest Debt service
Date Principal rate Interest payments
09-01-12 $425,000 4.450%$276,466.25 $701,466.25
03-01-13 267,010.00 267,010.00
09-01-13 440,000 4.600%267,010.00 707,010.00
03-01-14 256,890.00 256,890.00
09-01-14 9,945,000 (1)256,890.00 10,201,890.00
$10,810,000 $1,324,266.25 $12,134,266.25
(1) Actual maturity dates, principal amounts and interest rates are as follows:
Maturity Principal Interest ..
date amount rate
09-01-14 $460,000 4.700%
09-01-15 485,000 4.700%
09-01-16 505,000 4.800%
09-01-19 1,670,000 5.000%
09-01-21 1,260,000 5.000%
09-01-23 1,385,000 5.125%
09-01-28 2,375,000 5.500%
09-01-28 1,805,000 5.375%
$9,945,000
Exhibit B-4
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS ON THE 2005 BONDS
Interest Debt service
Date Principal rate Interest payments
09-01-12 $300,000 4.125%$164,164.38 $464,164.38
03-01-13 157,976.88 157,976.88
09-01-13 315,000 4.250%157,976.88 472,976.88
03-01-14 151,283.13 151,283.13
09-01-14 330,000 4.375%151,283.13 481,283.13
03-01-15 144,064.38 144,064.38
09-01-15 6,280,000 (1)144,064.38 .6,424,064.38
$7,225,000 $1,070,813.16 $8,295,813.16
(1) Actual maturity dates, principal amounts and interest rates are as follows:
Principal Interest
amount rate
$340,000 4.500%
360,000 4.250%
375,000 4.350%
390,000 4.500%
390,000 4.500%
410,000 4.600%
425,000 4.500%
1,915,000 4.625%
1,675,000 4.750%
$6,280,000
Maturity
date
09-01-15
09-01-16
09-01-17
09-01-18
09-01-19
09-01-20
09-01-21
09-01-25
09-01-28
Exhibit B -5
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS ON THE 2006 BONDS
Interest Debt service
Date Principal rate Interest payments
09-01-12 $375,000 4.000%$179,193.13 $554,193.13
03-01-13 171,693.13 171,693.13
09-01-13 395,000 4.000%171,693.13 566,693.13
03-01-14 163,793.13 163,793.13
09-01-14 405,000 4.000%163,793.13 568,793.13
03-01-15 155,693.13 155,693.13
09-01-15 .425,000 4.000%155,693.13 580,693.13
03-01-16 147,193.13 147,193.13
09-01-16 6,970,000 (1)147,193.13 7,117,193.13
$8,570,000 $1,455,938.17 $10,025,938.17
(1) Actual maturity dates, principal amounts and interest rates are as follows:
Maturity Principal Interest
date amount rate
09-01-16 $440,000 4.000%
09-01-17 455,000 4.000%
09-01-18 480,000 4.000%
09-01-19 460,000 4.000%
09-01-20 480,000 4.100%
09-01-21 500,000 4.200%
09-01-22 520,000 4.250%
09-01-23 540,000 4.300%
09-01-24 570,000 4.300%
09-01-25 590,000 4.350%
09-01-26 620,000 4.400%
09-01-28 1,315,000 4.375%
$6,970,000
Exhibit B-6
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS ON THE 2007 BONDS
interest Debt service
Date Principal rate Interest payment
09-01-12 $14,415,000 (1) $319,054.38 $14,734,054.38
(1) Actual maturity dates, principal amounts and interest rates are as follows:
Maturity Principal Interest
date amount rate
09-01-12 $485,000 4.000%
09-01-13 500,000 3.700%
09-01-14 520,000 3.750%
09-01-15 540,000 3.800%
09-01-16 560,000 4.000%
09-01-17 585,000 4.000%
09-01-18 605,000 4.125%
• 09-01-19 •680,000 4.250%
09-01-20 620,000.4.375%
09-01-21 650,000 4.500%
09-01-22 680,000 4.500%
09-01-23 710,000 4.500%
09-01-24 740,000 4.500%
09-01-25 775,000 4.500%
09-01-26 810,000 4.700%
09-01-27 850,000 4.750%
09-01-29 4,105,000 . 4.750%
$14,415,000
Interest
rate Interest
3.125%$211,300.63
206,378.75
3.750%206,378.75
200,285.00
3.875%200,285.00
193,697.50
4.500%193,697.50
185,822.50
4.750%1.85,822.50
177,153.75
4.625%177,153.75
168,250.63
(1)168 250.63
$2,474,476.89
Debt service
payments
$526,300.63 •
206,378.75
531,378.75
200,285.00
540,285.00
193,697.50
543,697.50
185,822.50
550,822.50
177,153.75
562,153.75
168,250.63
6,298,250.63
$10,684,476.89
Date
09-01-12
03-01-13
09-01-13
03-01-14
09-01-14
03-01-15
09-01-15
03-01-16
09-01-16
03-01-17
09-01-17
03-01-18
09-01-18
Principal
$315,000
325,000
340,000
350,000
365,000
385,000
6,130,000
$8,210,000
Exhibit B-7
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS ON THE 2009 BONDS
(1) Actual maturity dates, principal amounts and interest rates are as follows:
Maturity Principal Interest
date amount rate
09-01-18 $400,000 5.000%
09-01-19 425,000 5.000%
09-01-20 415,000 5.000%
09-01-21 435,000 5.125%
09-01-22 455,000 5.250%
09-01-23 485,000 5.375%
09-01-24 250,000 5.500%
09-01-25 250,000 5.625%
09-01-26 1,110,000 5.700%
09-01-27 600,000 5.750%
09-01-29 1,305,000 5.875%
$6,130,000
Exhibit C
Page 1 of 2
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS AND YIELD ON THE BONDS
(Bond Yield For The First Yield Period)
$2,680,000 3.070%$480,504.89
832,507.25
• 2,720,000 3.070%832,507.25
790,755.25
2,800,000 3.070%790,755.25
747,775.25
2,885,000 3.070%747,775.25
703,490.50
2,970,000 3.070%703,490.50
657,901.00
296,055.45
$14,055,000 $7,583,517.84
Date
05-22-12
09-01-12
03-01-13
09-01-13
03-01-14
09-01-14
03-01-15
09-01-15
03-01-16
09-01-16
03-01-17
05-22-17
Bond Total debt
value service
($56,915,000.00) (1) ($56,915,000.00)
Present value on
May 22, 2012
using a yield of
3.071183%
($56,915,000.00)
3,134,125.62
813,073.22
3,417,104.82
749,112.61
3,350,213.83
687,130.94
3,287,673.24
627,032.50
3,224,723.13
568,794.98
37,056,015.11
$0.00
Interest Total debt
Principal rate Interest service
$3,160,504.89 3,160,504.89
832,507.25 832,507.25
3,552,507.25 •3,552,507.25
790,755.25 790,755.25
3,590,755.25 3,590,755.25
747,775.25 747,775.25
3,632,775.25 3,632,775.25
703,490.50 703,4-90.50
3,673,490.50 3,673,490.50
657,901.00 657,901.00
296,055.45 42,860,000.00 (2)43,156,055.45
$21,638,517.84 ($14,055,000.00)$7,583,517.84
(1)Bond valuation as of May 22, 2012
- Principal amount of the Bonds $56,915,000.00
(2)Bond valuation as of May 22, 2017
- Principal amount of the Bonds $42,860,000.00
Exhibit C
Page 2 of 2
Development Authority of Pearland, Texas
DEBT SERVICE PAYMENTS AND YIELD ON THE BONDS
(Bond Yield For The Second Yield Period)
_Present value on
May 22, 2017
Interest Total debt Bond Total debt using a yield of
Date Principal rate Interest service value service 3.071199%
05-22-17 ($42,860,000.00) (1)($42,860,000.00)($42,860,000.00)
09-01-17 $3,070,000 3.070%$361,845.55 $3,431,845.55 3,431,846 3,403,201.38
03-01-18 610,776.50 610,776.50 610,777 596,518.47
09-01-18 3,160,000 3.070%610,776.50 3,770,776.50 3,770,777 3,627,054.11
03-01-19 562,270.50 562,270.50 562,271 . 532,660.15
09-01-19 3,255,000 3.070%562,270.50 3,817,270.50 3,817,271 3,561,553.77
03-01-20 512,306.25 512,306.25 512,306 470,758.19
09-01-20 3,120,000 3.070%512,306.25 3,632,306.25 3,632,306 3,287,247.13
03-01-21 464,414.25 464,414.25 464,414 413,939.72
09-01-21 3,215,000 3.070%464,414.25 3,679,414.25 3,679,414 3,229,921.07
03-01-22 415,064.00 415,064.00 415,064 358,847.52
05-22-22 186,778.80 186,778.80 27,040,000.00 (2)27,226,779 23,378,298.48
$15,820,000 $5,263,223.35 $21,083,223.35 ($15,820,000.00)$5,263,223.35 $0.00
(1) Bond valuation as of May 22, 2017
- Principal amount of the Bonds $42,860,000.00
(2) Bond valuation as of May 22, 2022
Principal amount of the Bonds $27,040,000.00
APPENDIX I
Applicable schedules provided by
BOSC, Inc.
Development Authority of Pearland, Texas
Sources & Uses Report
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Sources of Funds:
Principal Amount of Current Interest Bonds (CIBs)56,915,000.00
Issuer Contribution of Reserve Fund 1,374,330.00
Total SOURCES of Funds $58,289,330.00
Uses of Funds:
Open Market Escrow Cost 54,746,584.45
Initial Cash Contibution to the Escrow . 145.78
New Money Proceeed. 3,250,000.00
Issuance Expenses: ($289,500.00)
Bond Counsel 150,000.00
Atlornery General Fee 9,500.00
Financial Advisory 88,500.00
Paying Agent Fees 10,000;00
Bank Counsel 10,000.00
Miscellaneous 5,000.00
Verification Agent 16,5 00.00
Rounding Amount 3,099.77
Total USES of Funds $58,289,330.00
Miccellanennc Rand Iccnanr-e Infnrmaiinn_
Delivery Date:05/22/2012
Principal Amount of Bonds Being Refunded 49,230;000.00
Principal Amount of the Refunding Bonds 56,915,000.00
Proceeds of "The (new) Bonds"56,915,000.00
Rate/Yield on the Refunded Bonds 4.81 771 906
"All Costs Included" TIC on the New Issue is 3.13696447
Federal Arbitrage Yield on the New Issue is 3.07037433%
Yield on Escrow 0.62848825
Total Debt Service Savings -1,107,807.45
Present Value Savings 3.07037433%-1,485,026.75
Total Debt Service Savings as a Percent of
Total Debt Service of Refunded Bonds -1.51147290%
Present Value Savings as a Percent of
Principal Amount of Bonds Being Refunded -3.01650773
DAP 2012: RUNI2REFNEWI2REFNEWI2 AGGREF Prepared by: BOSC, Inc. - Houston, Texas (713) 289 .5897 (JHR) 05/02/20129110:14 v9.53
Page-2
Development Authority of Pearland, Texas
Escrow Coverage Analysis - Investment Receipts vs. Cash Requirements
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Escrow Start Date is 05/22/2012
Idle $ Days
Escrow Escrow (Idle#Days Other Cash Draw Escrow
Dates Maturing Amounts Coupon Interest x Bal /$1,000)Investments Required Fund Balance
05/22/2012 0.00 0.00 8.16 145.78 0.00 145.78
07/17/2012 0.00 115,303.13 3,925.26 0.00 0.00 115,448.91
06/20/2012 0.00 11,512.50 634.81 0.00 0.00 126,961.41
08/25/2012 0.00 55,320.00 364.56 0.00 0.00 182,281.41
08/27/2012 0.00 12,790;63 195.07 0.00 0.00 - 195,072.04
06/28/2012 0.00 50,623.13 737.09 0.00 0.00 245,695.17
08/31/2012 16,706,000.00 31,323.75 16,983.02 0.00 0.00 16,983,018.92
09/01/2012 0.00 0.00 391.94 0.00 16,980,178.78 2,840.14
01/17/2013 0.00 115,303.13 4,016.87 0.00 0.00 118,143.27
02/20/2013 0.00 11,512.50 648.28 0.00 0.00 129,655.77
02/25/2013 0.00 55,320.00
___
369.95 0.00 0.00 184,975.77
02/27/2013 555,000.00 12,790.63 752.77 0.00 0.00 752,766.40
02/28/2013 0.00 50,623.13 803.39 0.00 ,0.00 803,389.53
03/01/2013 0.00 0.00 44.98 -0.00 803,058.77 330.76
07/15/2013 200,000.00 0.00 400.66 0.00 0.00 200,330.76
07/17/2013
_
0.00 115,303.13 10,731.55 0.00 0.00 315,633.89
08/20/2013 1,842,000.00 11,512.50 10,845.73 0.00 0.00 2,169,146.39
08/25/2013 0.00 55,320.00 4,448.93 ' 0.00 0.00 2,224,466.39
08/27/2013 0.00 3,425.00 2,227.89 0.00 0.00 2,227,891.39
08/28/2013 0.00 50,623.13 9,114.06 0.00 0.00 2,278,514.52
09/01/2013 0.00 0.00 62.89 0.00 2,278,058.77 455.75
01/17/2014 0.00 115,303.13 4,514.60 0.00 0.00 115,758.88
02/25/2014 0.00 55,320.00 342.16 0.00 0.00 171,078.88
02/27/2014 548,000.00 3,425.00 722.50 0.00 0.00 722,503.88
02/28/2014 0.00 50,623.13 773.13 0.00 0.00 773,127.01.
03/01/2014 0.00 0.00 120.85 0.00 772,251.27 675.74
07/17/2014 0.00 115,303.13 4,530.98 0.00 0.00 116,178,87
08/25/2014 0.00 55,320.00 514.50 0.00 0.00 171,498.87
08/28/2014 11,571,000.00 50,623.13 . 47,172.49 0.00 0.00 11,793,122.00
09/01/2014 0.00 - 0.00 120.16 0.00 11,792,251.27 870.73
01/17/2015 0.00 115,303.13 2,323.48 0.00 0.00 116,173.86
02/06/2015 322,000.00 0.00 8,325.30,0.00 0.00 438,173.86
02/25/2015 0.00 55,320.00 1,973.98 0.00 0.00 493,493.86
03/01/2015 0.00 0.00 5.28 0.00 493,455.01 38.85
07/15/2015 86,000.00 0.00 172.08 .0.00 _ 0.00 86,038.85
07/17/2015 5,271,000.00 115,303.13 109,446.84 0.00 0.00 5,472,341.98
08/06/2015 1,863,000.00 0.00 44,012.05 0.00 0.00 7,335,341.98
08/12/2015 158,000.00 0.00 97,413.45 0.00 0.00 7,493,341.98
08/25/2015 0.00 55,320.00 52,840.63 0.00 0.00.7,548,661.98
09/01/2015 0.00 0.00 0.00 32.70 0.00 7,548,455.01 206.97
02/06/2016 278,000.00
_
0.00 5,285.93 0.00'0.00 278,206.97
02/25/2016 0.00 55,320.00 1,667.63 0.00 0.00 -333,526.97
03/01/2016 0.00 0.00 69.54 0.00 333,015.63 511.34
07/15/2016 218,000.00 0.00 4,807.25 0.00 0.00 - 218,511.34
Page-10
Idle $ Days
Escrow Escrow (Idle #Days Other Cash Draw Escrow
Dales Maturing Amounts Coupon Interest x Be[ / $1,000)Investments Required Fund Balance
08/06/2016 1,863,000.00 0.00 39,548.72 0.00 0.00 2,081,511.34
08/25/2016 5,532,000.00 55,320.00 53,681.82 '0.00 0.00 7,668,831.34
09/01/2016 0.00 0.00 128.88 0.00 7,668,015.63 815.71
02/06/2017 177,000.00 0.00 4,089.76 0.00 0.00 177,815.71
03/01/2017 0.00 0.00 104.59 0.00 177,153.75 661.96
08/06/2017 562,000.00 0.00 14,629.21 0.00 0.00 562,661.96
09/01/2017 0.00 0.00 80.30 0.00 562,153.75 508.21
02/06/2018 168,000.00 0.00 3,875.69 0.00 0.00 168,508.21
03/01/2018 0.00 0.00 35.03 0.00 168,250.63 257.58
07/15/2018 .4,435,000.00 0.00 97,575.67 0.00 0.00 4,435,257.58
08/06/2018 1,863,000.00 0.00 163,754.70 0.00 0.00 6,298,257.58
09/01/2018 0.00 0.00 0.00 0.00 6,298,250.63 6.95
Totals $54,218,000.00 $1,656,410.07 $832,399.74 $145.78 $55,874,548.90
Cost of Securities Purchased for Escrow $54,590,096.79
Accrued Interest of Securities Purchased for Escrow 156,487.67
Initial Cash Deposit to Escrow 0.23
Total Cost of Escrow $54,746,584.69
Investment YLD (Based on Proceeds Arrival Dates)0.82845074%
Arbitrage YLD (Final Maty(s) May be "Rolled" Into 0% SLGs)0.81739606
Principal Amount of Bonds Defeased 49,230,000.00
Settlement Date for Investments 05/22/2012
qkq
FF
bb{
DAP 2012: RUN12REF OMSI2REF AGGREF OMSI2ESC CSHESC Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR)05/02/2012 @ 10:16 v9.53
Page-11
Development Authority of Pearland, Texas
Open Market Securities -- Settlement Date of 05/22/2012
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
n ^A^vLe4 Ce
Principal Accrued
Name/CUSIP Maturit Amount Rate $ Price Yield/DR Cost Interest Total Cost
U.S.T-Notes 912828PH7 08/31/2012 16,706,000 0.375000 100.097420 0.020008 16,722,274.99 14,129.74 16,736,404.73
U.S. AGY's 3133XP2W3 02/27/2013 555,000 3.375000 102,461050 0.150001 568,658.83 4,422.66 573,081.49
Agency Discount31359YBSS 07/15/2013 200,000 0.000000 99.748000 0.216516 199,496.00 0.00 199,496.00
U.S. AGY's 31398AX31 08/20/2013 1,842,000 1.250000 101.309330 0.195999 1,866,117.86 5,884.17 1,872,002.03
U.S. AGY's 3135G0AP8 02/27/2014 548,000 1.250000 101.758810 0.250001 557,638.28 1,617.36 559,255.64
U.S. AGY's 3135GOBYB 08/28/2014
__
11,571,000 0.875000 101.297860 0.300374 11,721,175.38 23,624.13 11,744,799.51
Agency Discoun13i358C3V6 02/06/2015 322,000 0.000000 99.058000 0.342545 318,966.76 0.00 318,966.76
Agency Dlscount3l359YBW6 07/15/2015 86,000 .0.000000 98.595000 0.440209 84,791.70 0.00 - 84,791.70
U.S.AGY's 3134A4VC5 07/17/2015 5,271,000 4.375000 111.938520 0.549999 5,900,279.39 80,071.61 5,980,351.00
Agency Discounl31358C3W4 08/06/2015 1,863,000 0.000000 98.255000 0.536465 1,830,490.65 0.00 1,830,490.65
Agency D1scount31358AES5 08/12/2015 158,000 0.000000 98.246000 0.536483 155,228.68 0.00 155,228.68
Agency Discount31358C3X2 02/06/2016 278,000 0.000000 97.624000 0.631262 271,394.72 0.00 271,394.72
Agency Discount31359YBY2 07/15/2016 218,000 0.000000 96.943000 0.726416 211,335.74 0.00 211,335.74
Agency Discount3135803Y0 08/06/2016 1,863,000 0.000000 96.941000 0.716487 1,806,010.83 0.00 1,806,010.83
U.S. AGY's 3137EACW7 08/25/2016 5,532,000 2.000000 105.185640 0.760000 5,818,869.61 26,738.00 5,845 607.61
Agency Discount3135803Z7
_
02/06/2017 177,000 0.000000 95.638000 0.912446 169,279.26 0.00 169,279.26
Agency Discounl31358C4A1 08/06/2017 562,000 0.000000 94.205000 1.096845 529,432.10 0.00 529,432.10
Agency Oixcounl31358C4139 .02/06/2018 168,000 0.000000 93.402000 1.138677 156,915.36 0.00 156,915.36
Agency Discount31359YCC9 07/15/2018 4,435,000 0.000000 90.558000 1.514085 4,016,247.30 0.00 4,016,247.30
Agency Discount31358C4C7 08/06/2018 1,863,000 0.000000 90.472000 1.513048 1,685,493.36 0.00 1,685,493.36
Totals $54,218,000 $54,590,096.80 $156,487.67 $54,746,584.47
WAM = 2.475 yrs
Yleld = 0.82845074
DAP 2012: OMS12ESC Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 05/02/2012 @ 10:16 v9.53
Page-12
Development Authority of Pearland, Texas
FINAL NUMBERS -Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03/01/2012 Tax Increment Contract Revenue Bonds,Delivery Date = 03/01/2012
Series 2004
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 -425,000.00 425,000.00 . 4.450 4.450000 100.000000 227,956.88 652,956.88 652,956.88 652,956.88
03/01/2013 --- -218,500.63 218,500.63 -218,500.63
09/01/2013 -440,000.00 440,000.00 4.600 4.600000 100.000000 218,500.63 658,500.63 877,001.26 658,500.63
03/01/2014 -----208,380.63 208,380.63 -208,380.63
09/01/2014 460,000.00.460,000.00 4.700 4.700000 100.000000 208,380.63 668,380.63 876,761.26 6,348,380.63
03/01/2015 ----- -197,570.63 197,570.63 --
09/01/2015 -485,000.00 •485,000.00 4.700 4.700000 100.000000 197,570.63 682,570.63 880,141.26 -
03/01/2016 . ----- -186,173.13 186,173.13 --
09/01/2016 -505,000.00 505,000.00 4.800 4.800000 100.000000 186,173.13 - 691,173.13 877,346.26 -
03/01/2017 --174,053.13 174,053.13 _ -
09/01/2017 - (4)530,000.00 "530,000.00 5.000 5.000000 100.000000 174,053.13 704,053.13 878,106.26 -
03/01/2018 ----- -160,803.13 160,803.13 --
09/01/2018 - (4)555,000.00 `555,000.00 5.000 5.000000 100.000000 160,803.13 715,803.13 876,606.26
03/01/2019 ----- -146,928.13 146,928.13 -
09/01/2019 1,670,000.00 (4)585,000.00 585,000.00 5.000 5.000000 100.000000 146,928.13 731,928.13 878,856.26
03/0112020 ---- -132,303.13 132,303.13 --
09/01/2020 • (1)615,000.00 '615,000.00 5.000 5.000000 100.000000 132,303.13 747,303.13 879,606.26
03/01/2021 ---- -116,928.13 116,928.13 -
09/01/2021 1,260,000.00 (1)645,000.00 645,000.00 5.000 5.000000 100.000000 116,928.13 761,928.13 878,856.26
03/01/2022 -- -100,803.13 100,803.13
09/01/2022 - (2)675,000.00 675,000.00 5.125 5.125000 100.000000 100,803.13 775,803.13 876,606.26 -
03/01/2023 ---- -83,506.25 83,506.25 -
09/01/2023 1,385,000.00 (2)710,000.00 '710,000.00 5.125 5.125000 100.000000 83,506.25 793,506.25 877,012.50
03/01/2024 ----- -65,312.50 65,312.50 --
09/01/2024 - (3)420,000.00 '420,000.00 5.500 5.500000 100.000000 65,312.50 485,312.50 550,625.00 -
03/01/2025 ----- -53,762.50 53,762.50 -
09/01/2025 - (3)445,000.00 445,000.00 5.500 5.500000 100.000000 53,762.50 498,762.50 552,525.00 -
63/01/2026 ---- -41,525.00 41,525.00 -
09/01/2026 - (3)475,000.00 475,000.00 5.500 5.500000 100.000000 41,525.00 516,525.00 558,050.00
03/01/2027 ---28,462.50 28,462.50 -
D9/01/2027 - (3)500,000.00 '500,000.00 5.500 5.500000 100.000000 28,462.50 528,462.50 556,925.00 -
03/01/2028 --- -14,712.50 14,712.50 -
09/01/2028 2,375,000.00 (3)535,000.00 '535,000.00 5.500.5.500000 100.000000 14,712.50 549,712.50 564,425.00 -
Total 6,690,000.00 9,005,000.00 9,005,000.00 4,087,406.98 13,092,406.98 13,092,406.98
4
10,086,719.40
Acc Int -----
Grand Ttls 6,690,000.00 9 005000.00 9,005,000.00 4 087 406.98 13 092 406.98 13 092 406.98 10 086 719.40
* - Bonds callable ... 09/01/2014@100.000
TIC ((ntl. all expenses) .... 5.20170575%Average Coupon .......5.22469176
TIC (Arbitrage TIC).........5.20170576%Average Life (yrs)... 8.69 IRS Form 8038-G NIC = 5.224692% (with Adjstmnl of $0.00).
Bond Years ..................78,232.50 WAM (yrs) .............8.687674 NIC = 5.224692% (with Adjstmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" Identifies each respective term bond.
DAP 2012: OLD2004R Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 05/02/2012 @ 10:17 v9.53
Page-14
Development Authority of Pearland, Texas
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03/01/2012 Tax Increment Contract Revenue Bonds, Delivery Date = 03/01/2012 Series 2004
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - -- - - - 48,509.38 48,509.38 48,509.38 48,509.38
03/01/2013 -- 48,509.38 48,509.38 -48,509.38
09/01/2013 - - - - 48,509.38.48.509.38 97,018.76 48,509.38
03/01/2014 -- - - - ., 48,509.38 48,509.38 -- 48,509.38
09/01/2014 - - 48,509.38 48,509.38 97,018.76 1,853,509.38
03/01/2015 - -- - - - 48,509.38 48,509.38 -
09/01/2015 - -- - - - 48,509.38 48,509.38 97,018.76
03/01/2016.. -- - - - 48,509.38 48,509.38 --
09/01/2016 - -- - - - 48,509.38 48,509.38 97,018.76 _
03/01/2017 48,509.38 48,509.38__
09/01/2017 - -. - - - - 48,509.38 48,509.38 97018.76 -
03/01/2018 - -- - - - 48,509.38 48,509.38 -
09/01/2018 -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2019 -- - - - 48,509.38 48,509.38 -
09/01/2019 - -- 48,509.38 48,509.38 97,018.76 -
03/01/2020 - -- - - - 48,509.38 48,509.38 -
09/01/2020 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2021 - -- - - - 48,509.38 48,509.38 --
09/01/2021 -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2022 -48,509.38 48,509.38 --
09/01/2022 - -- - - 48,509.38 48,509.38 97,018.76
03/01/2023 - -- - - - 48,509.38 48,509.38 -
09/01/2023 - -- - - - 48,509.38 48,509.38 97,018.76 -
03/01/2024 - -- - - - 48,509.38 48,509.38 -
09/01/2024 - (1) 330 000.00 *330 000.00 5.375 5,375000 100.000000 48,509.38 378 509.38 427,018.76
03/01/2025 - -- - - - 39,640.63
_
39,640.63
09/01/2025 - (1) 345,000.00 *345,000.00 5.375 5.375000 100.000000 39,640.63 384,640.63 424,281.26
03/01/2026 - -- - - - - 30,368.75 30,368.75 -
09/01/2026 - (1) 360,000.00 ' 360,000.00 5.375 5.375000 100.000000 30,368.75 390,368.75 420,737.50 -
03/01/2027 20,693.75 20,693.75
09/01/2027
_ __
(1)
_
380,000.00 "380,000.00 5.375 5.375000 100.000000 20,693.75 400,693.75 421,387.50 { -t
03/01/2028 - -- - - - 10;481.25 10,481.25 -_
09/01/2028 1,805,000.00 (1) 390,000.00 *390,000.00 5.375 5.375000 100.000000 10,481.25 400,481.25 410,962.50
Total 1,805,000.00 1,805,000.00 1,805,000.00 1,415,103.26 3,220,103.26 3,220,103.26 2,047,546.90
Acc Int
Grand Tits
- -
1,805,000.00 1805 000.00
-
1,805,000.00 1,415,103.26 - 3 220 103.26 - 3,220,103.26 -
2 047 546.90
- Bonds callable ... 09/01/2014@100.000
TIC (Incl. all expenses) .... 5.37500053% Average Coupon .......5.37500051%
TIC (Arbitrage TIC).........5.37500053% Average Life (yrs)... 14.59 IRS Form 8038-G NIC = 5,375001% (with Adjstmnt of $0.00).
Bond Years ..................26,327.50 WAM (yrs) .............14.585873 NIC = 5.375001% (with Ad'stmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" Identifies each respective term bond.
DAP 2012: OLD2004BR Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR)05/02/2012 @ 10:17 v9.53 f-
Page-15
Development Authority of Pearland, Texas
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 03/01/2012 Tax Increment Contract Revenue Bonds,Delivery Date = 03/01/2012
Series 2005
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - 300,000.00 300,000.00 4.125 4.125000 . 100.000000 164,164.38 464,164.38 464,164.38 464,164.38
03/01/2013 - ---- -157,976.88 157,976.88 -157,976.88
09/01/2013 - 315,000.00 315,000.00 4.250 4.250000 100.000000 157,976.88 472976.88 630,953.76 472,976.88
03/01/2014 - ---- -151,283.13 151,283.13 -151,283.13
09/01/2014 330,000.00 330,000,00 4.375 4.375000 100.000000 151,283.13 _ 481,283.13 632,566.26 481,283.13
03/01/2015
_
---- -144,064.38 144,064.38 -144,064.38
09/01/2015 - 340,000.00 340,000.00 4.500 4.500000 100.000000 .144,064.38 484,064.38 628,128.76 6,424,064.38
03/01/2016 - ----136,414.38 136,414.38 -
09/01/2016 - 360,000.00 360,000.00 4.250 4.250000 100.000000 136,414.38 496,414.38 632,828.76
03/01/2017 ---- -128,764.38 128,76 4.38 -
09/01/2017 - 375,000.00 375,000.00 4.350 4.350000 100.000000 128,764.38 503,764.38 632,528.76 -
03/01/2018 - ---- -120,608.13 120,608.13 --
09/01/2018 - 390,000.00 390,000.00 4.500 4.500000 100.000000 120,608.13 510,608.13 631,216.26
03/01/2019 ---- -111,833.13 111,833.13 --
09/01/2019 390 ,000.00 390,000.00 4.500 4.500000 100.000000 111,833.13 501,833.13 613,666.26
03/01/2020 - ---- . .103,058.13 103,058.13 -
09/01/2020 - 410,000.00 '410,000.00 4.600 4.600000 100.000000 103,058.13 513,058.13 616,116.26
03/01/2021 --- -93,628.13 93,628.13 -
09/01/2021 - 425,000.00 •425,000.00 4.500 4.500000 100.000000 93,628.13 518,628.13 612,256.26 -
03/01/2022 - ---- - 84,065.63 84,065.63 _-
09/01/2022 - (1) 450,000.00 •450,000.00 . 4.625 4.625000 100.000000 84,065.63 534,065.63 618,131.26 .•
1 03/01/2023 - ---- -73,659.38 73,659.38 -
09/01/2023 • (1) 470,000.00 '470,000.00 4.625 4.625000 100.000000 73,659.38 543,659.38 617,318.76
03/01/2024 - --- -62,790.63 62,790.63 -
09/01/2024 - (1) 4 8_5 000.00 '485,000.00 4.625 4.625000 100,000000 62,790.63 547,790.63 610,581.26 _
03/01/2025 - --- -51,575.00 51,575.00
09/01/2025 1,915,000.00 (1) 510,000.00 •510,000.00 '4.625 4.625000 100.000000 51,575.00 561,575.00 613,150.00
03/01/2026 - --- -39,781.25 39,781.25 -
09/01/2026 - (2) 530,000.00 530,000.00 4.750 4.750000 100.000000 39,781.25 569,781.25 609,562.50 -
03/01/2027 - -.27,193.75 27,193.75
09/01/2027 - (2) 560,000.00 '560,000.00 . 4.750 4.750000 100.000000 27,193.75 587,193.75 614,387.50 -
03/01/2028 - ---- -13,893.75 13,893.75 -
09/01/2028 1,675,000.00 (2) 585,000.00 '585,000.00 4.750 4.750000 100.000000 13,893.75 598,893.75 612,787.50 _ I
Total 3,590,000.00 7,225,000.00 7,225,000.00 3,165,344.50 10,390,344.50 -10,390,344.50 8,295,813.16
Acc Int -----
Grand Tits 3,590,000.00 7 225 000.00 7,225,000.00 3 165 344.50 10 390 344.50 10 390 344.50 8,295,813.15
' - Bonds callable ,,, 09/01/2015@100.000
TIC (loci. all expenses) ...- 4.61808456% Average Coupon .......4.62786578%
TIC (Arbitrage TIC) .........4.61808456% Average Life (yrs)... 9.47 IRS Form 8038-G NIC = 4.627866%(with Adjstmnt of $0.00).
Bond Years ..................68,397.50 WAM (yrs) .............9.466782 NIC = 4.627866% (with Adjstmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" Identifies each respective term bond.
DAP 2012: OLD2005R Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (Jill?) 05/02/2012 @ 10:17 v9.53
Page-16
Development Authority of Pearland, Texas
FINAL NUMBERS - Tax Increment Contract Revenue and.Refunding Bonds, Series 2012
Dated Date = 03101/2012 Tax Increment Contract Revenue Bonds,Delivery Date = 03/01/2012
Series 2006 CIFG Insured
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - 375,000.00 375,000.00 4.000 4.000000 100.000000 179,193.13 554;193.13 554,193.13 554,193.13
03/01/2013 - ---- -171,693.13 171,693.13 171,693.13
09/01/2013 - 395,000.00 395,000.00 4.000 4.000000 100.000000 171,693.13 566,693.13 738,386.26 566,693.13
03/01/2014 - --- -163,793.13 163,793.13 -163,793.13
09/01/2014 405,000.00 405,000.00 4.000 4.000000 100.000000 163,793.13 568,793.13 732,586.26 568,793.13
03/01/2015 ---- -155,693.13 155,693.13 -155,693.13
09/01/2015 - 425,000.00 425,000.00 4.000 4.000000 100.000000 155,693.13 580,693.13 736,386.26 580,693.13
03/01/2016 - ---- -147,193.13 147,1.93.13 -147,193.13
09/01/2016 - 440,000.00 440,000.00 4.000 4.000000 100.000000 147,193.13 587,193.13 734,386.26 7,117,193.13
03/01/2017 ---- -138,393.13 138,393_13 --
09/01/2017 - 455,000.00 '455,000.00 4.000 4.000000 100.000000 138,393.13 593,393.13 731,786.26 -
03/01/2018 - ---- -129,293.13 129,293.13 -
09/01/2018 - 480,000.00 •480,000.00 4.000 4.000000 100.000000 129,293.13 609,293.13 738,586.26 -
03/01/2019 ---- -119,693.13 119,693.13 -
09/01/2019 460,000,00 `460,000.00 4.000 4.000000 100.000000 119,693.13 579,693.13 699,386.26
03/01/2020 ' .-- -110,493.13 110,493.13 -
_
09/01/2020 - 480,000.00.480,000.00 '4.100 4.100000 100.000000 110,493.13 590,493.13 700,986.26 -
03/01/2021 - ----100,653.13 100,653.13 -
09/01/2021 - - 500,000.00 `500,000.00 4.200 4.200000 100.000000 100,653.13 600,653.13 701,306.26 -
03/01/2022 - ----90,153.13 90,153.13 -
09/01/2022 - 520,000.00 '520,000.00 4.250 4.250000 100.000000 90,153.13 610,153.13 700,306.26 -
03/01/2023 - ---- -79,103.13 79,103.13 --
09/01/2023 - 540,000.00 '540,000.00 4.300 4.300000 100.000000 79,103.13 619,103.13 698,206.26 -
03/01/2024 - ---- -67,493.13 67,493.13
09/01/2024 570 000.00 '570,000.00 4.300 4.300000 100.000000 67,493.13 637,493.13 704,986.26 -
03/01/2025 - ---- -55,238.13
_
55,238.13 -
09/01/2025 - 590,000.00 •590,000.00 4.350 4.350000 100.000000 55,238.13 645,238.13 700,476.26
03/01/2026 --- -42,405.63 42,405.63 --
09/01/2026 - 620,000.00 •620,000.00 4.400 4.400000 100.000000 42,405.63 662,405.63 704,811.26 -
03/01/2027 --.- -28,765.63 28,765.63 -
09/01/2027 - (1) 640,000.00 '640,000.00 4.375.4.375000 . 100.000000 28,765.63 668,765.63 697,531.26
03/01/2028 - ---_ _14,765.63 14,765.63
09/01/2028 1,315,000.00 (1) 675,000.00 675,000.00 4.375 4.375000 100.000000 14,765.63 689,765.63 704,531.26 -
Total 1,315,000.00 8,570,000.00 8,570,000.00 3,408,838.29 11,978,838.29 11,978,838.29 10,025,938.17
Ace Int ----
Grand Tits 1,315,000.00 8 570 000.00 8,570,600.00 3 408 838.29 11,978,838.29 11 978 838.29 10 025 938.17
' - Bonds callable ... 09/0l/2016@100.000
TIC (Intl. all expenses).... 4.25217073% Average Coupon .......4.26264635%
TIC (Arbitrage TIC).........4.25217073% Average Life (yrs)... 9.33 IRS Form 8038-G NIC = 4.262646%(with Adjstmnt of $0.00).
Bond Years ..................79,970.00 WAM (yrs) .............9.331389 NIC = 4.262646% (with Adjstmnt of $0.00).
Term bonds and their respective sinking payments are marked by "(n)" where each "n" identifies each respective term bond.
DAP 2012: OLD2006R Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5.897(JHR)05/02/2012 n$ 10:17 v9.53
ti
Page-17
Development Authority of Pearland, Texas
FINAL NUMBERS -Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Data = 03/01/2012 Tax Increment Contract Revenue Bonds; Series 2007 Delivery Date = 03/01/2012
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - 485,000.00 485,000.00 4.000 4,000000 100.000000 319,054.38 804,054.38 804,054.38 14,734,054.38
03/01/2013 - -----309,354.38 309,354.38 --
09/01/2013 - 500,000.00 •500,000.00 3.700 3.700000 100.000000 309,354.38 809,354.38 1,118,708.76 . -
03/01/2014 -----300,104.38 300,104.38 -
09/01/2014 - 520,000.00 `520,000.00 3.750 3.750000 100.000000 300,104.38 820,104.38 1,120,208.76
03/0112015 - ----290,354.38 290,354.38 -
09/01/2015 - 540,000.00 540,000.00 3.800 3.800000 100.000000 290,354.38 830,354.38 1,120,708.76
03/01/2016 - -----280,094.38 280,094.38 --
09/01/2016 - 560,000.00 •560,000.00 4.000 4.000000 100.000000 280,094.38 - 840,094.38 1,120,188.76
03/01/2017 -_268,894.38 268,894.38 -
09/01/2017 585,000.00 585,000.00 4.000 4.000000 100.000000 268,894.38 853,894.38 1,122,788.76 -
03/01/2018 - -----257,194.38 257,194.38 -it
09/01/2018 - 605,000.00 •605,000.00 4.125 4.125000 100.000000 257,194.38 862,194.38 1,119,388.76
03/01/2019 -----244,716.25 244,716.25 --
09/01/2019 - 680,000.00 '680,000.00 4.250 4.250000 100.000000 244,716.25 924,716.25 1,169,432.50 -
03/01/2020 - -----230,266.25 230,266.25 -
09/01/2020 - .620,000.00 `620,000.00 4.375 4.375000 100.000000 230,266.25 850,266.25 1,080,532.50
03/01/2021 - -----216,703.75 216,703.75 --
09/01/2021 - 650,000.00 650,000.00 4.500 4.500000 100.000000 216,703.75 866,703.75 1,083,407.50 -
03/01/2022 --202,078.75 202,078.75 -
09/01/2022 - 680,000.00 `680,000.00 4.500 4.500000 100.000000 202,078.75 882,078.75 1,084,157.50
03/01/2023 - -----186,778.75 186,778.75 --t
09/01/2023 710,000.00 710,000.00 4.500 4.500000 100.000000 186,778.75 896,778.75 1,083,557.50
03/01/2024 ----170,803.75 170,803.75 --
09/01/2024 740,000.00 `74000000 4.500 4.500000 100.000000 170,803.75 910,803.75 1,081,607.50
03/01/2025 - -----154,153.75 154,153.75 --
09/01/2025 775,000.00 `775,000.00 4.500 4.500000 100.000000 154,153.75 929,1 53.75 1,083,307.50 -
03/01/2026 - ----136,716.25 136,716.25 --
09/01/2026 - 810,000.00 810,000.00 4.700 4.700000 100.000000 136,716.25 946,716.25 1,083,432.50
03/01/2027 -----117 681.25 117,681.25 --
09/01/2027 - 850,000.00 850,000.00 4.750 4.750000 100.000000 117,681.25 967,681.25 1,085,362.50
03/01/2028 ----97,493.75 97,493.75 --
09/01/2028 - (1) 885,000.00 '885,000.00 4.750 4.750000 100.000000 97,493.75 982,493.75 1,079,987.50
03/01/2029 - -----76,475.00 76,475.00 -
09/01/2029 4,105,000.00 (1) 3,220,000.00 3,220,000.00 4.750 4.750000 100.000000 76,475.00 3,296,475.00 3,372,950.00 -
rtt
Total 4,105,000.00. 14,415,000.00 14,415,000.00 7,398,781.94 21,813,781.94 21,813,781.94 14,734,054.38
Acc Int ----
Grand Ttts 4,105,000.00 14 415 000.00 14 415 000.00 7,398,781.94 21 813 781.94 21 813 781.94 14 734 054.38
- Bonds callable ... 09/01/2012@100.000
TIC (Intl, all expenses).;.. 4.56711319% Average Coupon .......4.58732508%
TIC (Arbitrage TIC).........4.15411092% Average Life (yrs) 11.19 IRS Form 8038-G NIC = 4.587325% (with Adjstmnt of $0.00).
Bond Years ..................161,287.50 WAM rs) .............11.188866 NIC- 4.587325% (with Adjstmntof$0.00).
Thrm..hnnds and their respective ym mare marked by "(n)' where s i nkin g each "n" Identifies each respective term bond.
DAP 2012: OLD2007R -Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 05/02/2012 @ 10:17 v9.53 i!
Page-18
Development Authority of Pearland, Texas
FINAL NUMBERS -Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date =03/01/2012 Series 2009 Bonds Delivery Date = 03/01/2012
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates •Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 -315,000.00 315,000.00 3.125 3.125000 100.000000 197,394.38 512,394.38 512,394.38 512,394.38
03/01/2013 ------192,472.50 192,472.50 -192,472.50
09/01/2013 325,000.00 325,000.00 3.750 3.750000 100.000000 192,472.50 517,472.50 709,945.00 517,472.50
03/01/2014 - .----186,378.75 186,378.75 -186,378.75
09/01/2014 340,000.00 340,000.00 3.875 3.875000 100.000000 186,376.75 526,378.75 712,757.50 526,378.75
03/01/2015 -----179,791.25 179,791.25 -179,791.25
09/01/2015 -350,000.00 350,000.00 4.500 4.500000 100.000000 179,791.25 529,791.25 709,582.50 529;791.25
03/01/2016 ------171,916.25 171,916.25 -171,916.25
09/01/2016 -365,000.00 365,000.00 4.750 4.750000 100.000000 171,916.25 536,916.25 708,832.50 536,916.25
03/01/2017 -----163 247.50 163,247.50 -163,247.50
09/01/2017 -385,000.00 385,000.00 4.625 4.625000 100.000000 163,247.50 548,247.50 7111,495.00 548,247.50
03/01/2018 -----154,344.38 154,344.38 -154,344.38
09/01/2018 -400,000.00 400,000.00 5.000 5.000000 100.000000 154,344.38 554,344.38 708,688.76 5,784,344.38
03/01/2019 -----144,344.38 144,344.38 --
09/01/2019 425,000.00 425,000.00 5.000 5.000000 100.000000 144,344.38 569,344.38 713,688.76 -
03/01/2020 -----133,719.38 133,719.38 -
09/01/2020 -415,000.00 `415,000.00 5.000 5.000000 100.000000 133,719:38 548,719.38 682,438.76
03/01/2021 -----123,344.38 123,344.38
09/01/2021 -435,000.00 `435,000.00 5.125 5.125000 100.000000 123,344.38 558,344.38 681,688.76
03/01/2022 112,197.50 112,197.50
09/01/2022 -455,000.00 455,000.00 5.250 5.250000 100.000000 112,197.50 567,197.50 679,395.00 -
03/01/2023 -----100,253.75 100,253.75
09/01/2023 -485,000.00 485,000.00 5.375 5.375000 100.000000 100,253.75 585,253.75 685,507.50
03101/2024 ------87,219.38 87,219.38 -
09/01/2024 _ (2 )260,000,00 '260 000.00 5.700 5.700000 100.000000 87,219.38 347,219.38 434,438.76
03/01/2025 ------79,809.38 79,809.38 --
09/01/2025 - (2)285,000.00 •285,000.00 5.700 5.700000 100.000000 79,809.38 364,809.38 444,618.76
03/01/2026 ------71,686.88 71,686.88 --
09/01/2026 1,110,000.00 (2)565,000.00 565,000.00 5.700 5.700000 100.000000 71,686.88 636,686.88 708,373.76 -
03/01/2027 ---55,584.38 55,584.38 --
09/01/2027 -600,000.00 '600,000.00 5.750 5.750000 100.000000 55,584.38 655,584.38 - 711,168.76 -
03/01/2028 -----.-38,334.38 38,334.38 --
09/01/2028 - (1)635,000.00 `635,000.00 5.875 5.875000 100.000000 38,334.38 673,334.38 711,668.76 -
03/01/2029 ------19,681.25 19,681.25 --
09/01/2029 1,305,000.00 (1)670,000.00`670,000.00 5.875 5.875000 100.000000 19,681.25 689,681.25 '709,362.50 -
Total 2,415,000.00 7,710,000.00 7,710,000.00 4,226,045.72 11,936,045.72 11,936,045.72 10,003,695.64
Ac Int ---
Grand Ttls .2,415,000.00 7 710 000,00 7,710,000.00 4 226 045.72 11 936 045.72 11 936 045.72 10 003 695.64
• - Bonds callable ... - 09/01/2018@100.000
TIC (Incl. all expenses) .... 5.43642905%Average Coupon ....... 5.48303045%
TIC (Arbitrage TIC) .........5.43642905%Average Life (yrs)... 10.00 IRS Form 8038-6 NIC = 5.483030% (with Adjstmnt of $0.00).
Bond Years ..................77,075.00 WAM (yrs) .............9.996757 NIC = 5.483030% (with Ad slmnt of $0.00).
Term bonds and their rspsc0tve d by "(n)' where each "n" Iderilifies each respective term bond.
DAP 2012: OLD2009R Prepared by: BOSC, Inc. - Houston, Texas (713) 289.5897 (JHR) 05/02/2012 @ 10:171,9.53
Page-19
Development Authority of Pearland, Texas
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date =03/01/2012 Series 2009 Bonds Delivery Date = 03/01/2012
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates . Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call {{
09/01/2012.-- - - - 13,906.25 13,906.25 13,906.25 13,906.25
03/01/2013 - -- - - - 13,906.25 13,906.25 -13,906.25
09/01/2013 - -- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2014 - -- - - 13,906.25 13,906.25 -13,906.25
09/01/2014 - __ - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2015
_
- -- - - - 13,906.25 13,906.25 13,906.25..
09/01/2015 - -- - - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2016 - -- - - - 13,906.25 13,906.25 -13,906.25
09/01/2016 - -- - - - 13,906.25 13,906.25.27,812.50 13,906.25
03/01/2017 - 13,906.25 13,906.25 13,906.25
09/01/2017 - -- - - 13,906.25 13,906.25 27,812.50 13,906.25
03/01/2018 - -- - - 13,906.25 13,906.25 13,906.25
09/01/2018 - -- - - - 13,906.25 13,906.25 27,812.50 513,906.25
03/01/2019 - -- - - - 13,906.25 13,906.25 -
09/01/2019 -__ 13,906.25 - 13,906.25 27,812.50
03/01/2020
__
- -- - 13,906.25 13,906.25 --
09/01/2020 - -- - - - 13,906.25 13,906.25 27,812.50 -
03/01/2021 - -- - - - 13,906.25 13,906.25 --.
09/01/2021 - -- - - 13,906.25 13,906.25 27,812.50 -
03101/2022 -- - - 13,906.25 13,906.25 --
09/01/2022 - -. . - - - 13,906.25 13,906.25 27,812.50 -
03/01/2023 - -- - - - 13,906.25 13,906.25 -- {
09/01/2023 -- - - 13,906.25 13,906.25 27,812.50
03/01/2024 - - - 13,906.25 13,906.25 --
09/01/2024 250,000.00 '250000.00 5.500 5.500000 100.000000 13,906.25 263,906.25 277,812.50
03/01/2025 - -- - - - 7,031.25 7,031.25 -
09/01/2025 - 250,000.00 *250,000.00 5.625 5.625000 100.000000 7,031:25 257,031.25 264,062.50 -
Total - 500,000.00 500,000.00 361,718.75 861,718.75 861,718.75 680,781.25
Ace Int ----
Grand Ttls 500' 000.00 . 500 000.00 361 718.75 861 718.75 861 718.75 680 781.25
- Bonds callable ...09/01/2018@100.000
TIC (Intl. all expenses).... 5.56414824% Average Coupon .......5.56490365%
TIC (Arbitrage TIC) .........5.56414824% Average Life (yrs)... 13.00 IRS Form 8038-G NIC = 5.564904% (with Ad(simnt of $0.00).
Bond Years ..................6,500.00 WAM (yrs) .............13.000000 NIC = 5,564904/ (with Ad'stmnt of $0.00).
DAP 2012: OLD2009AR Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 05/02/2012 @ 10:17 v9.53
Page-20
Development Authority of Pearland, Texas FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 05/22/2012 Refunding Issue Delivery Date = 05122/2012
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
06/01/2012 - -------53,706,187.89
09/01/2012 - 2,375,000.00 '2,375,000.00 3.070 3.070000 100.000000 453,066.76 2,828,066.76 2,828,066.76
03/01/2013 ---787,301.50 7.87,301.50
09/01/2013 - 2,405,000.00 '2,405,000.00 3.070 3.070000 -100.000000 787,301.50 3,192,301.50 3,979,603.00 -
03/01/2014 ----_ -__ 750,384.75 750,384.75 -_
09/01/2014 - 2,475,000.00 '2,475,000.00 3.070 3.070000 100.000000 750,384.75 3,225,384.75 3,975,769.50
03/01/2015 .. ----712,393.50 712,393.50 -
09/01/2015 - 2,555,000.00 '2,555,000.00 3.070 3.070000 100.000000 712,393.50 3,267,393.50 3,979,787.00 -
03/01/2016 ---673,174.25 673,174.25 -
09/01/2016 .2,630,000.00 `2,630,000.00 3.070 3.070000 100.000000 673,174.25 3,303,174.25 3976,348.50 -
03/01/2017 - -----632,803.75 632,803.75
09/01/2017 - 2,715,000.00 '2,715,000.00 3.070 3.070000 100.000000 632,803.75 3,347,803.75 3,980,607.50
03/01/2018 -----591,128.50 591,128.50 -
09/01/2018 2,795,000.00 '2,795,000.00 3070 3.070000 100.000000 591,128.50 3,386,128.50 3,977,257.00
03/01/2019 548,225.25 548,225.25
09/01/2019 - 2,880,000.00 '2,880,000.00 3.070 3.070000 100.000000 548,225.25 3,428,225.25 3,976,450.50 -
03/01/2020 - ----504,017.25 504,017.25 --
09/01/2020 - 2,855,000.00 '2,855,000.00 3.070 3.070000 100.000000 504,017.25 3,359,017.25 3,863,034.50
03/01/2021 - -----460,193.00 460,193.00 --
09/01/2021 2,940,000.00 'X2,940,000.00 3.070 3.070000 100.000000 460,193.00 3,400,193.00 3,860,386.00
03/01/2022 - ----415,064.00 415,064.00
09/01/2022 - 3,030,000.00 '3,030,000.00 3.070 3.070000 100.000000 415;064.00 3,445,064.00 3,860,128.00
03/01/2023 - -----368,553.50 368,553.50 -
09/01/2023 - 3,130,000.00 '3,130,000.00 3.070 3.070000 100.000000 368,553.50 3,498,553.50 3,867,107.00 -
03/01/2024 320 508.00 320,508.00
09/01/2024 - 3,225,000.00 '3,225,000.00 3.070 3.070000 100.000000 320,508.00 3,545,508.00 3,866,016.00
03/01/2025 - -----271,004.25 271,004.25 -
09/01/2025 - 3,320,000.00 '3,320,000.00 3.070 3.070000 100.000000 271,004.25 3,591,004.25 3,862,008.50
03/01/2026 - -----220,042.25 220,042.25 -
09/01/2026 3,425 000.00 '3,425,000.00 3.070 3.070000 100.000000 220,042.25 3,645,042.25 3,865,084.50
03/01/2027 - -----167,468.50 167,468.50 .-
09/01/2027 - 3,530,000.00 '3,530,000.00 3.070 3.070000 100.000000 167,468.50 3,697,468.50 3,864,937.00 -
03/01/2028 - -----113,283.00 113,283.00 -
09/01/2028 - 3,635,000.00 '3,635,000.00 3.070 3.070000 100.000000 113,283.00 3,748,283.00 3,861,566.00
03/01/2029 57,485.75 57,485.75 -
09/01/2029 3,745,000.00 '3,745,000.00 3.070 3.070000 100.000000 57,485.75 3,802,485.75 3,859,971.50
Total - 53,665,000.00 53,665,000.00 15,639,128.76 69,304,128,76 69,304,128.76 53,706,187.89
Acc Int - ---
Grand Ills 53 665 000.00 53 665 000.00 15 639 128.76 69 304 128.76 69 304128.76 53 706187.89
* - Bonds callable :..06/01/2012@100.000
TIC (Inci. all expenses) ....3.13915709% Average Coupon ....... 3.07000000%
TIC (Arbitrage TIC) .........
Bond Years ..................
3.07036456% Average Life (yrs) ... 9.49
509,417.88 WAM (yrs) ............. 9.492553
IRS Form 8038-G NIC = 3.070000% (with Adjstmnt of $0.00).
NIC = 3.070000% (with Adjstmnt of $0.00).
DAP 2012: NEWI2REF Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (3HR) 05/02/2012 t?a 10:16 v9.53
Page-9
Development Authority of Pearland, Texas
FINAL NUMBERS - Tax Increment Contract Revenue and Refunding Bonds, Series 2012
Dated Date = 0 5/2 212 01 2 New Money Portion Delivery Date = 05/22/2012
Term Bond Bond Coupon Interest Total Fiscal Year Debt Service +!
Dates Maturities Redemptions Proceeds Rate Yield Price Amount Debt Service Debt Service to Call
09/01/2012 - 305,000.00 305,000.00 3.070 3.070000 100.000000 27,438.13 332,438.13 332,438.13 3,277,438.13
03/01/2013 - --- - - 45,205.75 45,205.75 --
09/01/2013 - 315,000.00 '315,000.00 3.070 3.070000 100.000000 45,205.75 360,205.75 405,411.50
03/01/2014 - ---- - 40,370.50 40,370.50 -
09/01/2014 325,000.00 '325,000.00 3.070 3.070000 100.000000 40,370.50 365;370.50 _• 405,741.00 -
03/01/2015
-.
---- - 35,381.75 35,381.75 --
09/01/2015 - 330,000.00 '330,000.00 3.070 3.070000 100.000000 35,381.75 365,381.75 400,763.50
03/01/2016 - ---- - 30,316.25 30,316.25 --
09/01/2016 - 340,000.00 '340,000.00 3.070 3.070000 100.000000 30,316.25 370,316-25 400,632.50
03/01/2017 -- 25,097.25 25,097.25 -
09/01/2017
__
- 355,000.00 '355,000.00 3.070 3.070000 100.000000 25,097.25 380,097.25 405,194.50
03/01/2018 - ---- - 19,648.00.19,648.00 --
09/01/2018 - 365,000.00 '365,000.00 3.070 3.070000 100.000000 19,648.00 384,648.00 404,296.00
03/01/2019 --- 14,045.25 14,045.25 --
09/01/2019 375,000.00 '375,000.00 3.070 3.070000 100.000000 14,045.25 389,045.25 403,090.50
03/01/2020
_
- ---- - 8,289.00 8,269.00
09/01/2020 - 265,000.00 •265,000.00 3.070 3070000 100.000000 8,289.00 273,289.00 281,578.00
03/01/2021 - --- 4,221.25 4,221.25 --
09/01/2021 - 275,000.00 •275,000.00 3.070 3.070000 100.000000 4,221.25 279,221.25 283,442.50 -
Total - 3,250,000.00 3,250,000.00 472,588.13 3,722,588.13 3,722,588.13 3,277,438.13
Acctnt -----
Grand Tlls 3,250,900,00 3 250 000.00 472 588.13 3,722,588.13 3 722 588.13 3,277,438.13
• - Bonds callable ... 09/01/2012@100.000
TIC (Intl. all expenses) .... 3.07067136% Average Coupon ....... 3.07000003%
TIC (Arbitrage TIC).........3.07007136% Average Lite (yrs)... 4.74 IRS Form 8038-G NIC = 3.070000% (with Adjstmnt of $0.00).
Bond Years .................. 15,393.75 WAM (yrs) .............4.736538 NIC = 3,070000% (with Adjstmnt of $0.00).
DAP 2012: NEW12 Prepared by: BOSC, Inc. - Houston, Texas (713) 289-5897 (JHR) 05/02/2012 0 10:18 v9.53
Page-23
DEVELOPMENT AUTHORITY OF PEARLAND, TEXAS
YIELD CALCULATION (5 -YEAR)
Present Value on
May 22, 2012
Interest Total Debt Bond Total Debt Using A Yield Of
Date Principal Rate Interest Service Value Service 3.071183%
5/22/2012 ($56,915,000.00)($56,915,000.00)($56,915,000.00)
9/1/2012 $2,680,000.00 3.070%$480,504.89 $3,160,504.89 3,160,504.89 3,134,125.62
3/1/2013 832,507.25 832,507.25 832,507.25 813,073.22
9/1/2013 2,720,000.00 3.070%832,507.25 3,552,507.25.3,552,507.25 3,417,104.82
3/1/2014 790,755.25 790,755.25 790,755.25 749,112.61
9/1/2014 2,800,000.00 3.070%790,755.25 3,590,755.25 3,590,755.25 3,350,213.83
3/1/2015 747,775.25 747,775.25 747,775.25 687,130.94
9/1/2015 2,885,000.00 3.070%747,775.25 3,632,775.25 3,632,775.25 3,287,673.24
3/1/2016 703,490.50 703,490.50 703,490.50 627,032.50
9/1/2016 2,970,000.00 3.070%703,490.50 3,673,490.50 3,673,490.50 3,224,723.13
3/1/2017 657,901.00 657,901.00 657,901.00 568,794.98
5/22/2017 296,055.45 296,055.45 42,860,000.00 43,156,055.45 37,056,015.10
Total $14,055,000.00 $7,583,517.84 $21,638,517.84 ($14,055,000.00)$7,583,517.84 $0.00
DEVELOPMENT AUTHORITY OF PEARLAND, TEXAS
YIELD CALCULATION (10-YEAR)
Present Value on
May 22, 2017
Interest Total Debt Bond Total Debt Using A Yield Of
Date Principal Rate Interest Service Value Service 3.071199%
5/22/2017 ($42,860,000.00)($42,860,000.00)($42,860,000.00)
9/1/2017 $3,070,000.00 3.070%$361,845.55 $3,431,845.55 3,431,845.55 3,403,201.38
3/1/2018 610,776.50 610,776.50 610,776.50 596,518.47
9/1/2018 3,160,000.00 3.070%610,776.50 3,770,776.50 3,770,776.50 3,627,054.10
3/1/2019 562,270.50 562,270.50 562,270.50 532,660.15
9/1/2019 3,255,000.00 3.070%562,270.50.3,817,270.50 3,817,270.50 3,561,553.77
3/1/2020 512,306.25 512,306.25 512,306.25 470,758.19
9/1/2020 3,120,000.00 3.070%512,306.25 3,632,306.25 3,632,306.25 3,287,247.13
3/1/2021 464,414.25 464,414.25 464,414.25 413,939.72
9/1/2021 3,215,000.00 3.070%464,414.25 3,679,414.25 3,679,414.25 3,229,921.07
3/1/2022 415,064.00 415,064.00 415,064.00 358,847.52
5/22/2022 186,778.80 186,778.80 27,040,000.00 27,226,778.80 23,378,298.47
Total $15,820,000.00 $5,263,223.35 $21,083,223.35 ($15,820,000.00)$5,263,223.35 $0.00
By:
Nan
Titl1-.
CERTIFICATE OF ESCROW AGENT RELATING TO
AUTHORITY OF OFFICER AND SIGNATURE IDENTIFICATION
I, the undersigned officer of Regions Bank (the "Bank"), do hereby execute and deliver
this certificate for the benefit of the Attorney General of the State of Texas and the purchasers of,
and all other persons interested in the validity of, the DEVELOPMENT AUTHORITY OF
PEARLAND TAX INCREMENT CONTRACT REVENUE AND REFUNDING BONDS,
SERIES 2012 (the "Bonds"), and I do hereby certify as follows:
1.That I am the duly chosen, qualified and acting officer of the Bank for the office
shown beneath my signature and I am duly authorized to execute and deliver this certificate.
2.That attached as Exhibit "A" to this certificate is a certified copy of the Bank's
resolution, in full force and effect as of the date of this certificate, relating to the corporate
authority of the Bank to enter into a certain Escrow Agreement by and between the Bank and the
Development Authority of Pearland, for the purpose of creating an escrow fund for the issuance
of the Bonds, and designating the officer of the Bank authorized to execute such Escrow
Agreement.
3.That the following is the duly elected, qualified and acting officer of the Bank
having the authority to act for an in the name of the Bank as set forth in Exhibit "A" and that the
signature set opposite his name is a true and correct signature:
NAME TITLE SIGN URE
R. Douglas Milner Vice President
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of
the Bank this day of May, 2012.
REGIONS BANK
HOU:3217198.1
CERTIFICATE
I, Cary Gilliam, a duty authorized Assistant Secretary of Regions Bank, an Alabama state-chartered banking
corporation headquartered in Birmingham, Alabama, hereby certify as follows:
1. Following is a true and correct copy of Article IV, Sections 10 -11 and Article V, Sections 9 and 12 of
the By-Laws of Regions Bank, as adopted by the Board of Directors at a duty convened meeting held
on May 13, 2010, at which a quorum was present, and the same are in full force and effect on the
date hereof:
"Article IV. Officers
Section 10. Officer in Char g e of Trust Department.
The officer in charge of the Trust Department shall be designated as such by the Board of
Directors and shall have the word "Trust" included in or appended to his or her title and shall
exercise general supervision and management over the affairs of the Trust Department. That officer
is hereby empowered to appoint all necessary agents or attorneys; also to make, execute and
acknowledge all checks, bonds, certificates, deeds, mortgages, notes, releases, leases, agreements,
contracts, bills of sale, assignments, transfers, powers of attorney or of substitution, proxies to vote
stock, or any other instrument in writing that may be necessary in the purchase, sate, mortgage,
tease, assignment, transfer, management or handling, in any way of any property of any description
held or controlled by the Bank in any fiduciary capacity. Said officer shall have such other duties and
powers as shall be designated by the Board of Directors.
Section 11. Other Officers in Trust Department.
The various other officers in the Trust Department shalt each have the word "Trust" in their
title and are empowered and authorized to make, execute, and acknowledge all checks, bonds,
certificates, deeds, mortgages, notes, releases, leases, agreements, contracts, bills of sate,
assignments, transfers, powers of attorney or substitution, proxies to vote stock or any other
instrument in writing that may be necessary to the purchase, sale, mortgage, lease, assignments,
transfer, management or handling in any way, of any property of any description held or controlled
by the Bank in any fiduciary capacity.
Article V. Miscellaneous
Section 9. Checks, Drafts, Transfers, etc.
The Chief Executive Officer, the President, any Regional or Local President, any Vice
President or Assistant Vice President, any Trust Officer or any Assistant Trust Officer, or Branch
Manager or any other employee designated by the Board of Directors, is authorized and empowered
on behalf of the Bank and in its name to sign and endorse checks and warrants, to draw drafts, to
issue and sign cashier's checks, to guarantee signatures, to give receipts for money due and payable
to the Bank, to sell, assign and transfer shares of capital stock, bonds, or other personal property or
securities standing in the name of or held by the Bank, whether in its own right or in any fiduciary
capacity, and to make or join in such consents, requests or commitments with respect to the same as
may be appropriate or authorized as to the holder thereof, and to sign such other papers and do such
other acts as are necessary in the performance of his or her duties. The authority conveyed to any
employee designated by the Board may be limited by general or specific resolution of the Board.
40-000062/200-07 - Exhibit I -Certification 10-1-10.docx
Section 12. Execution of Instruments and Documents.
The Chief Executive Officer, or the President, or any Regional or Local President or any Vice
President is authorized, in his or her discretion, to do and perform any and all corporate and official
acts in carrying on the business of the Bank, including, but not limited to, the authority to make,
execute, acknowledge, accept and deliver any and all deeds, mortgages, releases, bills of sale,
assignments, transfers, leases (as lessor or lessee), powers of attorney or of substitution, servicing or
sub-servicing agreements, vendor agreements, proxies to vote stock or any other instrument in
writing that may be necessary in the purchase, sale, lease, assignment, transfer, discount,
management or handling in any way of any property of any description held, controlled or used by
Bank or to be held, controlled or used by Bank, either in its own or in its fiduciary capacity and
including the authority from time to time to open bank accounts with the Bank or any other
institution, to borrow money in such amounts for such lengths of time, at such rates of interest and
upon such terms and conditions as any said officer may deem proper and to evidence the
indebtedness thereby created by executing and delivering in the name of the Bank promissory notes
or other appropriate evidences of indebtedness, and to guarantee the obligations of any subsidiary or
affiliate of the Bank. The enumeration herein of particular powers shall not restrict in any way the
general .powers and authority of said officers.
By way of example and not limitation, such officers of the Bank are authorized to execute,
accept, deliver and issue, on behalf of the Bank and as binding obligations of Bank, such agreements
and instruments as may be within the officer's area of responsibility, including, as applicable,
agreements and related documents (such as schedules, confirmations, transfers, assignments,
acknowledgments, and other documents) relating to derivative transactions, loan or letter of credit
transactions, syndications, participations, trades, purchase and sate or discount transactions,
transfers and assignments, servicing and sub-servicing agreements, vendor agreements,
securitizations, and transactions of whatever kind or description arising in the conduct of the Bank's
business.
The authority to execute and deliver documents, instruments, and agreements may be
limited by resolution of the Board of Directors, by a committee of the Board of Directors, by the Chief
Executive Officer, or by the President, by reference to subject matter, category, amount,
geographical location, or any other criteria, and may be made subject to such policies, procedures,
and levels of approval as may be adopted or amended from time to time.
2. I further certify that the following individuals are duly elected and serving officers of Regions
Bank holding the title shown by his or her name below and that such officers are assigned to the Trust
Department of Regions Bank or otherwise shown on the records of Regions Bank as occupying a position in
which he or she acts on behalf of Regions Bank in a trust capacity.
Name Title
R. Douglas Milner Vice President, Trust
IN WITNESS WHEREOF, I have set my hand and affixed the seal of Regions Bank, an Alabama banking
corporation, on this the 14th day of May, 2012.
Cary Liam
SEAL
Assistant cretary
40-000062/200-07 - Exhibit I - Certification 10-1-10.docx
Corporate Trust Department
Exhibit A
R. Douglas Milner, Vice President
DEVELOPMENT AUTHORITY OF PEARLAND
3519 Liberty Drive
Pearland, Texas 77581
May 1, 2012
Wells Fargo Bank, National Association
750 N. St. Paul Place, Suite 1750
MAC T9263-170
Dallas, Texas 75201
Re: Development Authority of Pearland Tax Increment Contract Revenue and
Refunding Bonds, Series 2012 (the "Bonds")
Ladies and Gentlemen:
The Development Authority of Pearland, Texas (the "Authority") has authorized the
issuance of the referenced Bonds for the purpose of refunding and defeasing certain of the
Authority's Bonds as described in the attached Notice of Redemption (the "Refunded Bonds").
The resolutions authorizing the issuance of the Refunded Bonds (the "Resolutions") require that
written notice be sent in thename of the Authority not less than 30 days prior to a redemption
date.
As paying agent/registrar for the Refunded Bonds, Wells Fargo Bank, N.A. is instructed
to send notices in connection with each Refunded Bond in accordance with the respective
Resolutions authorizing the issuance of the. Refunded Bonds. The notices and the calls for
redemption are conditional in all respects upon the closing of the referenced Bonds.
Please acknowledge your receipt of this letter and the enclosures by signing the enclosed
counterpart of this letter in the space provided below and returning it to Tanya Fischer at
Andrews Kurth LLP, 600 Travis, Suite 4200, Houston, Texas 77002.
DEVELOPMENT AUTHORITY OF PEARLAND
By: /s/
Chair, Board of Directors
HOU:3216745.3
Receipt of Notice of Redemption for certain Development Authority of Peland
Refunded Bonds as described in the attached Notice of Redemption, acknowledged this /'day
of May, 2012:
WELLS FARGO BANK, NATIONAL ASSOCIATION
By: Nov
Name: s'uu L. V . ps lava
Title: 0.ccao ^'C Ass •c:oAc.
HOU:3216745.1
NOTICE OF REDEMPTION
NOTICE is hereby given that the Development Authority of Pearland (the "Authority") will redeem
the following bonds (the "Refunded Bonds") of the Authority as follows:
Series
Tax Increment Contract Revenue
Bonds, Series 2004
Tax Increment Contract Revenue
Bonds, Series 2005
Tax Increment Contract Revenue
Bonds, Series 2006
Original Principal Call Remaining
Maturity Amount Date/Price Outstanding
09/01/2012 $425,000 Escrowed to Maturity $0
09/01/2013 440,000 Escrowed to Maturity $0
09/01/2014 460,000 Escrowed to Maturity $0
09/01/2015 485,000 09/1/2014 @ 100%$0
09/01/2016 505,000 09/1/2014 @ 100%$0
09/01/2019 1,670,000(a)09/1/2014 @ 100%$0
************
09/01/2021 1,260,000(a)09/1/2014 @ 100%$0
************
09/01/2023 1,385,000(a)09/1/2014 @ 100%$0
************
09/01/2028 1,805,000(a)09/1/2014 @ 100%$0
09/01/2028 2,375,000(a)09/1/2014 @ 100%$0
09/01/2012 $300,000 Escrowed to Maturity $0
09/01/2013 315,000 Escrowed to Maturity $0
09/01/2014 330,000 Escrowed to Maturity $0
09/01/2015 340,000 Escrowed to Maturity $0
09/01/2016 360,000 09/1/2015 @ 100%$0
09/01/2017 375,000 09/1/2015.@l00%$0
09/01/2018 390,000 09/1/2015 @ 100%$0
09/01/2019 390,000 09/1/2015 @ 100%$0
09/01/2020 410,000 09/1/2015 @ 100%$0
09/01/2021 425,000 09/1/2015 @ 100%$0
09/01/2025 1,915,000(a)09/1/2015 @ 100%$0
************
09/01/2028 1,675,000(a)09/1/2015 @ 100%$0
09/01/2012 $375,000 Escrowed to Maturity $0
09/01/2013 395,000 Escrowed to Maturity $0
09/01/2014 405,000 Escrowed to Maturity $0
09/01/2015 425,000 Escrowed to Maturity $0
09/01/2016 440,000 Escrowed to Maturity $0
09/01/2017 455,000 09/1/2016 @ 100%$0
09/01/2018 480,000 09/l/2016@100%$0
09/01/2019 460,000 09/1/2016@100%$0
09/01/2020 480,000 09/1/2016 @ 100%$0
09/01/2021 500,000 09/1/2016 @ 100%$0
09/01/2022 520,000 09/1/2016 @ 100%$0
09/01/2023 540,000 09/1/2016 @ 100%$0
09/01/2024 570,000 09/1/2016 @ 100%$0
09/01/2025 590,000 09/1/2016 @ 100%$0
09/01/2026 620,000 09/1/2016 @ 100%$0 *********
09/01/2028 1,315,000(a)09/1/2016 @ 100%$0
HOU:3216745.3
Tax Increment Contract Revenue
Bonds, Series 2007 09/01/2012 $485,000 Escrowed to Maturity $0
09/01/2013 500,000 09/1/2012@100%$0
09/01/2014 520,000 09/1/2012 @ 100%$0
09/01/2015 540,000 09/1/2012 @ 100%$0
09/01/2016 560,000 09/1/2012@100%$0
09/01/2017 585,000 09/1/2012 @ 100%$0
09/01/2018 605,000 09/1/2012@100%$0
09/01/2019 680,000 09/1/2012 @ 100%$0
09/01/2020 620,000 09/1/2012 @ 100%$0
09/01/2021 650,000 09/1/2012 @ 100%$0
09/01/2022 680,000 09/1/2012@100%$0
09/01/2023 710,000 09/1/2012 @ 100%$0
09/01/2024 740,000 09/1/2012 @ 100%to
09/01/2025 775,000 09/1/2012 @ 100%$0
09/01/2026 810,000 09/1/2012 @ 100%$0
09/01/2027 850,000 09/1/2012 @ 100%$0
09/01/2028 4,105,000(a)09/1/2012 @ 100%$0
Tax Increment Contract Revenue
Bonds, Series 2009 09/01/2012 $315,000 Escrowed to Maturity $0
09/01/2013 325,000 Escrowed to Maturity $0
09/01/2014 340,000 Escrowed to Maturity $0
09/01/2015 350,000 Escrowed to Maturity $0
09/01/2016 365,000 Escrowed to Maturity $0
09/01/2017 385,000 Escrowed to Maturity $0
09/01/2018 400,000 Escrowed to Maturity $0
09/01/2019 425,000 09/1/2018 @ 100%$0
09/01/2020 415,000 09/1/2018@100%$0
09/01/2021 435,000 09/1/2018 @ 100%$0
09/01/2022 455,000 09/1/2018 @ 100%$0
09/01/2023 485,000 09/1/2018 @ 100%$0
09/01/2024 250,000 09/1/2018 @ 100%$0
09/01/2025 250,000 09/1/2018 @ 100%$0
************
09/01/2026 1,110,000(a)09/1/2018@100%$0
09/01/2027 600,000 09/1/2018 @ 100%$0
09/01/2029 1,305,000(a)09/1/2018 @ 100%$0
(a) Represents a Term Bond.
HOU:3216745.3
The redemption price for the Refunded Bonds is 100% of the par amount thereof plus
accrued interest to the date of redemption. The principal amount of Refunded Bonds being redeemed
shall become due and payable on the redemption date specified above, and upon the Authority's
making due provision for the payment of the redemption price of such bonds, the interest on the
principal amount of bonds being redeemed shall cease to accrue from and after the date of
redemption.
Payment of the redemption price for the principal amount of bonds being redeemed shall be
made at the Designated Payment/Transfer Office of the Paying Agent/Registrar only upon
presentation and surrender by the holder thereof.
Dated: May 1, 2012
Chair, Board of Directors
Development Authority of Pearland
HOU:3216745.3
CERTIFICATE OF PAYING AGENT
This certificate is made by Wells Fargo Bank, N.A. (the "Bank"), as paying agent for the
Development Authority of Pearland Tax Increment Contract Revenue Bonds, Series 2004, Series
2005, Series 2006, Series 2007 and Series 2009 (the "Refunded Bonds"). I hereby certify the
following:
a.The Bank agrees to continue to serve as paying agent for the Refunded
Bonds and to limit the Bank's remedies for nonpayment of fees under the
Paying Agent/Registrar Agreements currently in effect for such Refunded
Bonds to an action for amounts due and owing thereunder.
b.The Refunded Bonds will be called for redemption prior to their scheduled
maturities on the redemption dates, at the redemption price of par plus
accrued interest and, pursuant to the Bond Resolution. The Board of
Directors have directed giving notice of redemption in accordance with the
resolutions authorizing the Refunded Bonds. The Bank acknowledges
receipt of such notice of redemption instructions.
Witness my signature this 17 day of May, 2012.
WELLS FARGO BANK, N.A.
By:
Title: ^/I(,Q^/ ^'^1Gr
HOU:3218379.1
INDENTURE OF TRUST
By And Between
DEVELOPMENT AUTHORITY OF PEARLAND,
the "Authority"
and
REGIONS BANK
as "Trustee"
DATED AS OF MAY 1, 2012
SECURING
DEVELOPMENT AUTHORITY OF PEARLAND
TAX INCREMENT CONTRACT REVENUE AND REFUNDING BONDS
SERIES 2012
HOU:3210582.5
TABLE OF CONTENTS
Pa e
ARTICLE I DEFINITIONS AND INTERPRETATION ................................................................3
Section1.01 Definitions .................................................................................................3
Section 1.02 Recitals, Table of Contents, Titles and Headings .....................................9
Section 1.03 Interpretation .............................................:...............................................9
ARTICLE II GRANTING CLAUSES ..........................................................................................10
ARTICLE III AUTHORIZATION OF TAX INCREMENT CONTRACT REVENUE
BONDS; GENERAL TERMS AND PROVISIONS OF TAX
INCREMENT CONTRACT REVENUE BONDS; ADDITIONAL
PARITY BONDS AND SUBORDINATE LIEN OBLIGATIONS ......................12
Section 3.01 Authorization of Tax Increment Contract Revenue Bonds .....................12
Section 3.02 Additional Parity Bonds ..........................................................................12
Section 3.03 Subordinate Lien Obligations .................................................................13
Section3.04 Declaration ..............................................................................................14
ARTICLE IV FUNDS AND INVESTMENTS .............................................................................15
Section 4.01 Creation of Funds ....................................................................................15
Section 4.02 Pledged Revenue Fund ...........................................................................15
Section 4.03 Debt Service Fund ...................................................................................16
Section 4.04 Debt Service Reserve Fund .....................................................................16
Section4.05 Project Fund ............................................................................................17
Section 4.06 Surplus Fund ...........................................................................................17
Section4.07 Rebate Fund ............................................................................................17
Section 4.08 Investments; Earnings .............................................................................18
ARTICLE V COVENANTS OF THE AUTHORITY ..................................................................20
Section 5.01 Payment of Tax Increment Contract Revenue Bonds and
Performance of Obligations ....................................................................20
Section 5.02 Recordation and Execution of Security Instruments ..............................20
Section 5.03 Title Encumbrances of Pledged Revenues ..............................................20
Section 5.04 Pledged Revenues Not Encumbered .......................................................20
Section 5.05 Collection of Contract Tax Increments ...................................................21
Section 5.06 Amendment of Tri-Party Agreement ......................................................21
ARTICLE VI DEFAULT AND REMEDIES ................................................................................22
Section 6.01 Events of Default ....................................................................................22
Section6.02 Notices ....................................................................................................22
Section 6.03 Notice of Default .....................................................................................22
Section 6.04 Remedies in General ................................................................................22
Section 6.05 Appointment of Receivers ......................................................................23
Section 6.06 Trustee May Act Without Possession of Tax Increment Contract
RevenueBonds .......................................................................................23
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HOU:3210582.5
Section 6.07 Trustee as Attorney in Fact ......................................................................23
Section 6.08 Remedies Not Exclusive .........................................................................23
Section 6.09 Limitation on Suits ..................................................................................23
Section 6.10 Right of Owners of the Tax Increment Contract Revenue Bonds
to Direct Proceedings ..............................................................................24
Section 6.11 Restoration of Rights and Remedies .......................................................24
Section 6.12 Waiver of Stay or Extension Laws ..........................................................25
Section 6.13 Delay or Omission Not Waiver ...............................................................25
ARTICLEVII DISCHARGE ........................................................................................................26
Section 7.01 Discharge by Payment ............................................................................26
Section 7.02 Discharge by Deposit ..............................................................................26
ARTICLE VIII THE TRUSTEE ..........................................................................................:........28
Section 8.01 Acceptance of Trusts ...............................................................................28
Section 8.02 Reliance by Trustee .................................................................................30
Section 8.03 Certificate of the Authority as Proof .......................................................30
Section 8.04 Trustee May Own Tax Increment Contract Revenue Bonds ..................30
Section 8.05 Compensation of Trustee ........................................................................30
Section 8.06 Removal of Trustee ..................................................................................30
Section 8.07 Resignation of Trustee ............................................................................31
Section 8.08 Appointment of Successor Trustee .........................................................31
Section 8.09 Powers of Successor Trustee ..................................................................31
Section 8.10 Merger, Conversion or Consolidation of Trustee ...................................32
Section 8.11 Funds Transfer ...................................................................................::...32
ARTICLE IX MODIFICATION OF INDENTURE .....................................................................33
Section 9.01 Supplemental Indentures Not Requiring Consent of Owners of
the Tax Increment Contract Revenue Bonds ..........................................33
Section 9.02 Supplemental Indentures Requiring Consent of Owners of the
Tax Increment Revenue Bonds ...............................................................33
Section9.03 Consents ..................................................................................................34
ARTICLE X GENERAL PROVISIONS .......................................................................................35
Section 10.01 Proof of Execution of Writings and Ownership .....................................35
Section 10.02 Benefits of Indenture ...............................................................................35
Section 10.03 No Individual Liability ............................................................................35
Section10.04 Notice ......................................................................................................3 6
Section 10.05 Governing Law ........................................................................................36
Section10.06 Severability .............................................................................................36
Section 10.07 Successors and Assigns ...........................................................................36
Section 10.08 Execution in Several Counterparts ..........................................................36
11
HOU:3210582.5
INDENTURE OF TRUST
THIS INDENTURE OF TRUST, dated as of the 1st day of May, 2012, (the "Indenture"),
is made by and between DEVELOPMENT AUTHORITY OF PEARLAND, a not-for-profit
local government corporation organized under Chapter 431, Texas Transportation Code and
existing under the laws of the State of Texas (the "Authority"), and Regions Bank, an Alabama
state banking corporation with a corporate trust office in Houston, Texas (together with any
successor trustee hereunder, the "Trustee").
WITNESSETH
WHEREAS, by Ordinance No. 891, adopted on December 21, 1998, the City of Pearland
(the "City") created Reinvestment Zone Number Two, City of Pearland, Texas (the "TIRZ")
pursuant to Chapter 311, Texas Tax Code, and approved a preliminary project plan for the TIRZ
and a preliminary reinvestment zone financing plan for the TIRZ; and
WHEREAS, by Resolution No. 2004-107, adopted on June 28, 2004, the City authorized
the creation of the Authority to aid, assist and act on behalf of the City in the performance of the
City's governmental and proprietary functions with respect to, and to provide financing for, the
TIRZ; and
WHEREAS, by Ordinance No. R2004-170, adopted on October 11, 2004, the City
approved that certain Agreement by and between the City, the TIRZ, and the Authority (the "Tri-
Party Agreement"), pursuant to which the City delegated to the Authority the power and
authority to issue, sell or deliver its bonds, notes or other obligations in accordance with the
terms of the Tri-Party Agreement; and
WHEREAS, the Authority has previously issued its $13,995,000 Tax Increment Contract
Revenue Bonds, Series 2004, (the "Series 2004 Bonds"), its $9,775,000 Tax Increment Contract
Revenue Bonds, Series 2005 (the "Series 2005 Bonds"), its $9,970,000 Tax Increment Contract
Revenue Bonds, Series 2006 (the "Series 2006 Bonds"), its $15,950,000 Tax Increment Contract
Revenue Bonds, Series 2007 (the "Series 2007 Bonds"); and its $8,815,000 Tax Increment
Contract Revenue Bonds, Series 2009 (the "Series 2009 Bonds") (collectively, the "Refunded
Bonds");
WHEREAS, the Authority intends to issue its Tax Increment Contract Revenue Bonds
(as herein defined), in one or more series; and
WHEREAS, by Resolution No. 2012-55, adopted on April 30, 2012, the City authorized
the Authority to issue, sell, or deliver its Tax Increment Contract Revenue and Refunding Bonds,
Series 2012 for purpose of paying Project Costs and refunding the Refunded Bonds; and
WHEREAS, the Participants (as herein defined) have agreed to make certain payments,
which are sufficient to pay the principal of, interest on and redemption requirements of the Tax
Increment Contract Revenue Bonds, the charges and expenses of paying agents, registrars and
trustees utilized in connection with the issuance of the Tax Increment Contract Revenue Bonds,
and all amounts required to establish and maintain the funds to be established under this
Indenture and the Bond Resolution (as herein defined); and
HOU:3210582.5
WHEREAS, in order to further secure the Tax Increment Contract Revenue Bonds, the
Authority has determined to enter into this Indenture with the Trustee for the purpose of
assigning and pledging to the Trustee the Contract Tax Increments (as herein defined), for the
purpose of establishing the Pledged Revenue Fund, the Project Fund, the Debt Service Fund, the
Debt Service Reserve Fund and the Surplus Fund pursuant hereto and thereby providing the
Pledged Revenues (as herein defined) to be held by the Trustee to secure the payment of
principal of and interest on all Tax Increment Contract Revenue Bonds from time to time issued
under the Bond Resolutions.
NOW, THEREFORE, in consideration of the premises, the acceptance by the Trustee of
the trusts hereby created, the purchase and acceptance of the Tax Increment Contract Revenue
Bonds by the Owners thereof, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Authority and the Trustee do hereby mutually
covenant and agree, for the equal and proportionate benefit of the respective Owners from time
to time of the Tax Increment Contract Revenue Bonds, as follows:
[END OF RECITALS]
HOU':3210582.5
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01 Definitions. Unless otherwise expressly provided or unless the context
clearly requires otherwise, the following terms shall have the respective meanings specified
below for all purposes of this Indenture:
"Act" shall mean Chapter 431, Texas Transportation Code, as amended.
"Additional Parity Bonds" shall mean the additional parity Tax Increment Contract
Revenue Bonds permitted to be issued by the Authority pursuant to Section 3.02 of this
Indenture.
"AISD" shall mean Alvin Independent School District.
"AISD Agreement" shall mean that Interlocal Agreement approved by the City by
Resolution No. R99-45, adopted on June 14, 1999, by and between the City, AISD and the TIRZ
pursuant to which AISD has agreed to transfer a portion of its Tax Increment to the Tax
Increment Fund, as amended.
"Annual Debt Service" means for any annual period (any fiscal year or any other twelve
(12) consecutive calendar month period), an amount equal to the sum of (i) all interest on the
Bonds which is due during such period, plus (ii) that portion of the Principal Installment or
Installments of the Bonds which is due during such period, as limited and calculated in the
following manner:
(a). Except as modified below, (i) for any twelve (12) consecutive calendar
month period other than the calendar year, whether or not such period constitutes the
Authority's current fiscal year or any future Authority fiscal year, the aggregate amount
of interest on and Principal Installment of the Bonds which was paid or mandatorily
redeemed or is scheduled to accrue and be paid or mandatorily redeemed during such
twelve (12) consecutive month period; and (ii) for any fiscal year while the Authority's
fiscal year is the same as the calendar year, the aggregate amount of interest on and
Principal Installment of the Bonds which was paid or mandatorily redeemed or is
scheduled to accrue and be paid or mandatorily redeemed after January 1 of such fiscal
year and on or before the next following January 1; and
(b). As to any annual period prior to the date of any calculation, such
requirements shall be calculated solely on the basis of Bonds which were Outstanding as
of the first (1st) day of such period; and as to any future year such requirements shall be
calculated solely on the basis of Bonds Outstanding as of the date of calculation; and
(c)As to any Bonds that bear interest at a variable interest rate which cannot
be ascertained at the time of .calculation, an interest rate equal to the greater of (i) an
annual interest rate as reasonably determined by the Authority's financial advisor which
rate shall be equal to the Bond Buyer Revenue Bond Index (or, if the Bond Buyer
Revenue Bond Index is unavailable, a comparable index chosen), or (ii) the weighted
3
1-IOU:3210582.5
average rate of interest born by such Bonds (or other indebtedness of comparable credit
quality, maturity and purchase terms in the event that such Bonds were not outstanding)
during the preceding Fiscal Year (or any period of comparable length ending within 180
days) prior to the date of calculation, shall be presumed to apply for all future dates and
the principal shall be evenly allocated over the life of the Bond issue with an equal
amount of principal deemed due each year but solely for the purpose of spreading the
principal requirements for calculation of coverage; and
(d) Notwithstanding the foregoing, all amounts which are deposited to the
credit of the Debt Service Reserve Fund from original proceeds from the sale of any
Bonds and amounts which have been or are expected to be realized as interest and
investment earnings on amounts on deposit in the Debt Service Fund (other than those
amounts which are to be deposited into the Rebate Fund pursuant to Section 4.07 of this
Indenture) and which are used or scheduled to be used to pay interest on or Principal
Installments of Bonds during any annual period, shall be deemed to reduce the Annual
Debt Service for any such annual period to the extent of such interest and investment
earnings; and the amount of such deposits shall be excluded from and shall not constitute
Annual Debt Service for any such annual period.
For purposes of calculating a Reserve Requirement, "Annual Debt Service" shall be
defined as provided in the Bond Resolution establishing such Reserve Requirement.
"Authority" shall mean the Development Authority of Pearland, or its legal successors.
"Authorized Representative" shall mean the Chairman or the Vice Chairman of the
Authority designated to perform a specified act, to sign a specified document or to act generally
on behalf of the Authority by a written instrument furnished to the Trustee.
"Average Annual Debt Service" shall mean the total Annual Debt Service (as of the date
of the calculation) divided by the remaining number of years until the final maturity of the
Bonds. The Average Annual Debt Service calculated under this Indenture shall remain in effect
until the next date when such calculation is required under this Indenture. For the purposes of
calculating the Average Annual Debt Service, any fractional year shall be included in the
calculation as a full year.
"Board" shall mean the Board of Directors of the Authority.
"Bond Counsel" shall mean Allen Boone Humphries Robinson LLP and Andrews Kurth
LLP or such other nationally recognized firm engaged by the Authority.
"Bond Resolutions" shall mean the resolutions from time to time adopted by the
Authority authorizing the Tax Increment Contract Revenue Bonds.
"Bonds" or "Tax Increment Contract Revenue Bonds" shall mean one or more series of
bonds issued by the Authority pursuant to this Indenture and the Bond Resolutions.
"Brazoria County" shall mean Brazoria County, Texas.
4
HOU:3210582.5
"Brazoria County Agreement" shall mean that Interlocal Agreement approved by the City
by Resolution No. R99-62, adopted on August 30, 1999, by and between the City, Brazoria
County and the TIRZ pursuant to which Brazoria County has agreed to transfer a portion of its
Tax Increment to the Tax Increment Fund, as amended.
"Business Day" shall mean any day which is not a Saturday, Sunday, a day on which
banking institutions in the city where the principal corporate trust office of the Paying
Agent/Registrar is located are authorized by law or executive order to close, or a legal holiday.
"Captured Appraised Value" shall mean, with respect to each Taxing Unit in each year,
the total appraised value of real property taxable by the Taxing Unit and located in the TIRZ for
that year less the Tax Increment Base of the Taxing Unit.
"City" shall mean the City of Pearland, Texas.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and all applicable
Internal Revenue Service Regulations thereunder.
"Contract Tax Increments" shall mean Tax Increments from time to time required to be
deposited by the Participants into the Tax Increment Fund pursuant to the TIRZ Act and the
Participant Contracts and payable to the Authority by the City pursuant to the Tri-Party
Agreement.
"Costs of Issuance" shall mean all charges, costs and expenses of the Authority incurred
in connection with the authorization, issuance, sale and delivery of Tax Increment Contract
Revenue Bonds including, but not limited to, legal fees, financial advisory fees, bond insurance
premiums, fiscal or escrow agent fees, printing fees, accounting fees, consultant fees, verification
fees, travel expenses, rating agency fees, fees of the Trustee and its counsel and Attorney
General fees.
"Debt Service" shall mean the Principal Installments and interest on the Bonds.
"Debt Service Fund" shall mean the fund so designated and created pursuant to Article
IV of this Indenture.
"Debt Service Reserve Fund" shall mean one or more of the funds so designated and
created by a Bond Resolution pursuant to Article IV of this Indenture.
"Eligible Investments" shall mean any investments permitted by the Authority's written
Investment Policy, as may be amended from time to time, adopted pursuant to the Public Funds
Investment Act, Chapter 2256, Texas Government Code, as amended.
"Event of Default" shall mean any Event of Default described in Section 6.01 of this
Indenture.
"Exempt Securities" means bonds or other evidences of obligations, the interest on which
is exempt from federal income taxation under Section 103(a) of the Code.
5
HOU:3210582.5
"Fair Market Value" shall mean as of any particular time:
(i)as to Eligible Investments the bid and asked prices of which are published
on a regular basis in a financial journal or publication of general circulation in the
United States of America, the bid price for such Eligible Investments so published
on or most recently prior to the date of valuation by the Trustee, or
(ii)as to Eligible Investments the bid and asked prices of which are not
published on a regular basis in a financial journal or publication of general
circulation in the United States of America, the average bid price on such Eligible
Investments at the date of valuation by the Trustee, as reported to the Trustee by
any two nationally recognized dealers (in the opinion of the Trustee) in such
Eligible Investments.
"Fiscal Year" mans the fiscal year of the Authority, initially the 12-month period ending
September 30, 2012.
"Fort Bend County" shall mean Fort Bend County, Texas.
"Fort Bend County Agreement" shall mean that Interlocal Agreement approved by the
City by Resolution No. R99-57, adopted on August 9, 1999, by and between the City, Fort Bend
County and the TIRZ pursuant to which Fort Bend County has agreed to transfer a portion of its
Tax Increment to the Tax Increment Fund, as amended.
"Fund" shall mean any one or more, as the case may be, of the separate special Funds
created and established or required to be maintained pursuant to this Indenture.
"Interest Payment Date", when used in connection with any Bond, shall mean March 1
and September 1 commencing on such March 1 or September 1 as shall be set forth in the Bond
Resolution for such Bonds.
"Mandatory Redemption Installment" shall mean, as of any particular date of calculation
and with respect to any Series of Bonds, the amount of money to be applied to the mandatory
redemption (including any mandatory redemption premium, if any) of Bonds in any fiscal year
prior to maturity pursuant to this Indenture or any Bond Resolution, as such Mandatory
Redemption Installment shall have been previously reduced by the principal amount of any
Bonds of such Series of the maturity with respect to which such Mandatory Redemption
Installment is payable which are purchased or redeemed by the Trustee in accordance with the
provisions of this Indenture or of any Bond Resolution, other than a Mandatory Redemption
Installment redemption or purchase.
"Maximum Annual Debt Service" shall mean the greatest amount of the Annual Debt
Service calculated for any future fiscal year.
"Outstanding" when used with reference to Bonds, shall mean, as of a particular date, all
Bonds theretofore and thereupon delivered except: (a) any Bond canceled by or on behalf of the
Authority at or before said date, (b) any Bond defeased or no longer considered Outstanding
pursuant to the provisions of the Resolution or otherwise defeased as permitted by applicable
Cel
HOU:32 10532.5
law, and (c) any such Bond in lieu of or in substitution for which another Bond shall have been
delivered pursuant to the Resolution.
"Owner" or "Registered Owner", when used with respect to any Bond shall mean the
person or entity in whose name such Bond is registered in the Register. Any reference to a
particular percentage or proportion of the Owners shall mean the Owners at a particular time of
the specified percentage or proportion in aggregate principal amount of all Bonds then
Outstanding under the Resolution.
."Parity Bonds" shall mean the Bonds and each series of Additional Parity Bonds from
time to time hereafter issued, but only to the extent such Parity Bonds remain Outstanding.
"Participant Contracts" shall mean, collectively, the Tri-Party Agreement, the AISD
Agreement, the Brazoria County Agreement, the Fort Bend County Agreement, and any other
contracts or orders heretofore or from time to time hereafter entered into between the Authority
and Participants, containing provisions with respect to the payment by Participants of Tax
Increments.
"Participants" shall mean the City, AISD, Brazoria County and Fort Bend County.
"Paying Agent/Registrar" shall mean the bank or trust company so designated in the
Bond Resolutions.
"Pledged Revenue Fund" shall mean the fund so designated and created pursuant to
Article IV of this Indenture.
"Pledged Revenues" shall have the meaning assigned to that term in Article II of this
Indenture.
"Principal Installment" means, as of any particular date of computation and with respect
to Bonds of a particular Series, an amount of money equal to the aggregate of (a) the principal
amount of Outstanding Bonds of said Series which mature on a single future date, reduced by the
aggregate principal amount of such Outstanding Bonds of such Series which would at or before
said future date be retired as a result of Mandatory Redemption Installments applied in
accordance with this Indenture plus (b) the amount of any Mandatory Redemption Installment
payable on said future date for the retirement of any Outstanding Bonds of said Series.
"Principal Installment Payment Date", when used in connection with any Bond, shall
mean September 1 of each year in which principal is scheduled to be paid.
"Project and Financing Plan" shall mean the final Project Plan and Reinvestment Zone
Financing Plan of the TIRZ adopted by the Board of Directors of the TIRZ on August 23, 1999,
and approved by the City on August 23, 1999, by Ordinance No. 918, and as amended from time
to time.
"Project Costs" shall mean all project costs identified in the Project and Financing Plan as
authorized by the TIRZ Act and the Tri-Party Agreement.
7
HOU:3210582.5
"Project Fund" shall mean the fund so designated and created pursuant to Article IV of
this Indenture.
"Rebate Fund" shall mean the fund so designated and created pursuant to Article IV of
this Indenture.
"Register" or "Bond Register" shall mean the books of registration kept by the Paying
Agent/Registrar in which are maintained the names and addresses of, and the principal amounts
of the Bonds registered to, each Owner.
"Regulations" shall mean the Income Tax Regulations promulgated under the Code.
"Reserve Fund Surety Policy" shall mean an insurance policy or other credit agreement,
as such term is defined by Section 1371.001., Texas Government Code, in a principal amount
equal to the portion of the Reserve Requirement or a particular Debt Service Reserve Fund to be
satisfied and issued by a financial institution or insurance company which on the initial date of
such policy has a rating for its long term unsecured debt or claims paying ability in the highest
letter category by two major municipal securities evaluation sources.
"Reserve Requirement" for a particular Series of Bonds shall be defined in the Bond
Resolution authorizing the issuance of such Series of Bonds, if such Bond Resolution imposes
such a requirement. There shall be no Reserve Requirement for the series of bonds (the "Series
2012 Bonds") authorized by the Bond Resolution dated April 30, 2012.
"Series" shall mean all of the Bonds authenticated and delivered on issuance and
pursuant to this Indenture or any Bond Resolution authorizing the issuance of such Bonds as a
separate series of Bonds or any Bonds thereafter authenticated and delivered in lieu of or in
substitution for such Bonds.
"State" or "State of Texas" shall mean the State of Texas.
"Surplus Fund" shall mean the Authority's Surplus Fund so designated and created
pursuant to Article IV of this Indenture.
"Tax Increment" shall mean, with respect to each Taxing Unit in each year, the amount
of property taxes levied by the Taxing Unit for that year on the Captured Appraised Value of real
property taxable by the Taxing Unit and located in the TIRZ.
"Tax Increment Base" shall mean the total appraised value of property in the TIRZ as of
January 1, 1998 plus the total appraised value of real property taxable by a Taxing Unit and
annexed into the TIRZ as determined on January 1 of the year in which such property was
annexed into the TIRZ.
"Tax Increment Contract Revenue Bonds" or "Bonds" shall mean one or more series of
bonds issued by the Authority pursuant to this Indenture and the Bond Resolutions.
"Tax Increment Fund" shall mean the City's TIRZ Tax Increment Fund created and
maintained in accordance with Ordinance No. 891 and the TIRZ Act.
8
HOU:3210582.5
"Taxing Unit" shall mean, in addition to the Participants, a special district or authority
(including a junior college district, a hospital district, a navigation district, or other district
created by or pursuant to the V.T.C.A. Water Code), or any other political subdivision of the
State of Texas, whether created by or pursuant to the Texas Constitution or a local, special, or
general law, that is authorized to impose and is imposing ad valorem taxes on real property in the
TIRZ, even if the governing body of another political unit determines the tax rate for the unit or
otherwise governs its affairs.
"TJRZ" shall mean Reinvestment Zone Number Two, City of Pearland, Texas as
enlarged from time to time
"TIRZ Act" shall mean Chapter 311, Texas Tax Code; as amended.
. "Tr-Party Agreement" shall mean that certain Agreement by and between the City, the
TIRZ, and the Authority approved by the City by Ordinance No. R2004-170, adopted on October
11, 2004, and adopted on October 5, 2004, by the Board and the Board of Directors of the TIRZ,
as amended.
"Trustee" shall mean Regions Bank, and its successors in that capacity.
Section 1.02 Recitals, Table of Contents, Titles and Headings. The terms and phrases
used in the recitals of this Indenture have been included for convenience of reference only and
the meaning, construction and interpretation of such words and phrases for purposes of this
Indenture shall be determined solely by reference to Section 1.01. hereof. The table of contents,
titles and headings of the articles and sections of this Indenture 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 Indenture or any provision hereof or in ascertaining intent, if any
question of intent should arise.
Section 1.03 Interpretation. 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. This Indenture and all the terms and
provisions hereof shall be liberally construed to effectuate the purposes set forth herein and to
sustain the validity of this Indenture and the Tax Increment Contract Revenue Bonds.
[END OF ARTICLE I]
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ARTICLE II
GRANTING CLAUSES
In order to secure the payment of the principal of, redemption premium, if any, and
interest on all Tax Increment Contract Revenue Bonds as the same are issued and become due
and payable, whether at maturity or by prior redemption, and the performance and observance of
all of the covenants and conditions herein contained, and in consideration of the premises, the
acceptance by the Trustee of the trusts hereby created, the purchase and acceptance of the Tax
Increment Contract Revenue Bonds by the Owners thereof, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Authority does
hereby GRANT, BARGAIN, CONVEY, ASSIGN and PLEDGE to the Trustee and its
successors in trust hereunder, subject to the provisions of this Indenture, all of the Authority's
right, title and interest in and to the following described properties and interests, direct or
indirect, whether now owned or hereafter acquired (collectively, the "Pledged Revenues"):
(a)The Contract Tax Increments and all. of the Authority's right, title and
interest thereto under the Participant Contracts and the Tri-Party Agreement. (By
definition, the Contract Tax Increments do not include the Tax Increments of Taxing
Units other than the City, AISD, Brazoria County and Fort Bend County.)
(b)All moneys deposited or required to be deposited in the Pledged Revenue
Fund, the Debt Service Fund, and the Debt Service Reserve Fund held by the Trustee
pursuant to the provisions of this Indenture and all interest earnings and investment
income therefrom.
(c)Any and all property of every kind and nature (including without
limitation, cash, obligations or securities) which may from time to time hereafter be
conveyed, assigned, hypothecated, endorsed, pledged, mortgaged, granted, or delivered to
or deposited with the Trustee as additional security hereunder by the Authority, or anyone
on behalf of the Authority, or which pursuant to any of the provisions hereof may come
into the possession or control of the Trustee as security hereunder, or of a receiver
lawfully appointed hereunder, all of which property the Trustee is authorized to receive,
hold and apply according to the terms hereof. If and when an agreement is reached with
Fort Bend Independent School District or another Taxing Unit for the payment of its Tax
Increments into the Tax Increment Fund, the Authority may, but not necessarily will,
grant its right, title and interest in such Tax Increments to the Trustee as security
hereunder.
TO HAVE AND TO HOLD all the same, with all rights and privileges appurtenant
thereto, unto the Trustee and its successors in trust forever.
IN TRUST, NEVERTHELESS, upon the terms and trusts herein set forth, for the equal
and proportionate benefit and security of the Owners from time to time of the Tax Increment
Contract Revenue Bonds secured and to be secured hereunder, or any of them, without
preference, priority or distinction as to lien or otherwise of any Tax Increment Contract Revenue
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Bond over any other Tax Increment Contract Revenue Bond, except as otherwise expressly
provided in this Indenture.
PROVIDED, HOWEVER, that if the Authority, its successors or assigns, shall well and
truly pay, or cause to be paid, the principal of the Tax Increment Contract Revenue Bonds and
the interest and redemption premium, if any, due or to become due thereon, at the times and in
the manner provided in the Tax Increment Contract Revenue Bonds, and in the Bond Resolutions
according to the true intent and meaning thereof, and shall cause the payments to be made into
the - Funds maintained hereunder in the amounts required by this Indenture and the Bond
Resolutions, or shall provide, as permitted hereby, for the payment thereof by depositing with the
Trustee or Paying Agent/Registrar the entire amount due or to become due thereon, or an amount
sufficient to provide for the payment thereof, and shall pay or cause to be paid to the Trustee all
sums of money due or to become due to it in accordance with the terms and provisions hereof,
then this Indenture and the rights and liens hereby granted shall cease, terminate and be void;
otherwise this Indenture is to be and shall remain in full force and effect.
[END OF ARTICLE II]
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ARTICLE III
AUTHORIZATION OF TAX INCREMENT CONTRACT REVENUE BONDS; GENERAL
TERMS AND PROVISIONS OF TAX INCREMENT CONTRACT REVENUE BONDS;
ADDITIONAL PARITY BONDS AND SUBORDINATE LIEN OBLIGATIONS
Section 3.01 Authorization of Tax Increment Contract Revenue Bonds. (a) The Tax
Increment Contract Revenue Bonds may be authorized from time to time by the Authority
pursuant to Bond Resolutions duly adopted by the Board, which Bond Resolutions shall specify
the dates, denominations, principal amounts, interest rates, maturities, redemption provisions,
forms of bonds, manner of payment, provision for execution and authentication, application of
proceeds and all other terms and provisions of the Tax Increment Contract Revenue Bonds not
otherwise provided herein.
(b) At or prior to the issuance of each series of Tax Increment Contract
Revenue Bonds pursuant to any Bond Resolution, the Authority shall provide to the
Trustee the following:
(i)a certified copy of the Bond Resolution;
(ii)the approving opinion of the Authority's Bond Counsel with
respect to such series of Tax Increment Contract Revenue Bonds to the effect (i)
that the Bonds are legal, valid and binding obligations of the Authority except to
the extent that their enforceability may be limited by applicable provisions of the
federal bankruptcy laws and any other similar laws affecting the rights of
creditors of political subdivisions generally, and except that such enforceability is
subject to general principles of equity and the exercise of judicial discretion
(regardless of whether such enforceability is considered in a proceeding in law or
at equity), and (ii) that the Bonds are issued pursuant to the terms of this
Indenture;
(iii)if such series of Tax Increment Contract Revenue Bonds are being
issued to refund any previously issued Tax Increment Contract Revenue Bonds,
the identity, redemption date and redemption price of the Tax Increment Contract
Revenue Bonds to be refunded;
(iv)a debt service schedule with regard to such series of Tax Increment
Contract Revenue Bonds and all Tax Increment Contract Revenue Bonds that will
then be Outstanding after the issuance of such series of Tax Increment Contract
Revenue Bonds and refunding of any Tax Increment Contract Revenue Bonds
being refunded thereby; and
(v)the amount of the Reserve Requirement, for such series of Tax
Contract Revenue Bonds, if any, and the amount of the Reserve Requirement with
respect to any other series of Tax Increment Revenue Bonds, if any.
Section 3.02 Additional Parity Bonds. The Authority reserves the right to issue, for any
lawful purpose (including the refunding of any previously issued Parity Bonds), one or more
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series of Additional Parity Bonds payable from and secured by a lien on the Pledged Revenues,
on a parity with the Bonds, and any previously issued Additional Parity Bonds; provided,
however, that no Additional Parity Bonds may be issued unless:
(a)The Additional Parity Bonds mature on, and interest is payable on, the
Principal Installment Payment Dates and Interest Payment Dates, respectively;
(b)The City has approved issuance of the Additional Parity Bonds on the
terms set forth in the Tri-Party Agreement, as the same may be modified from time to
time;
(c)There shall be on deposit in the particular Debt Service Reserve Funds (to
the extent created and established by Bond Resolutions pursuant to Section 4.04), after
the issuance of the Additional Parity Bonds, an amount equal to the Reserve Requirement
on all Bonds that have a Reserve Requirement that will be Outstanding after the issuance
of such Additional Parity Bonds;
(d)The Authority certifies that it is not in material default with the terms of
the Indenture, any Bond Resolution, or the Tri-Party Agreement;
(e)The Authority has received a certificate meeting the requirements set forth
in paragraph (f) below which shows Captured Appraised Value which, at the
Participants' tax rates then in existence, will generate Contract Tax Increments that will
be at least 125 percent of projected Average Annual Debt Service, taking into account the
Bonds and the Additional Parity Bonds to be issued; provided, however, that this
requirement shall not apply to the issuance of any series of Additional Parity Bonds for
refunding purposes that will have the result of reducing the Average Annual Debt Service
requirements on Parity Bonds; and
(f)The certificate required by paragraph (e) above may be either: (i) a
certificate of the appropriate county appraisal district or districts showing certified values,
adjusted for exemptions, (ii) a certificate of the appropriate county appraisal district or.
districts showing estimated or preliminary values, adjusted for exemptions and losses due
to protests based on historical data (iii) a certificate of a registered Texas tax
assessor/collector showing certified values of the appropriate county appraisal district or
districts, adjusted for exemptions or estimated or preliminary values of the appropriate
county appraisal district or districts, adjusted for exemptions and losses due to protests
based on historical data, or (iv) a projection prepared by an independent real estate
appraiser.
Section 3.03 Subordinate Lien Obligations. The Authority reserves the right to issue,
for any lawful purpose, bonds, notes or other obligations secured in whole or in part by liens on
all or part of the Pledged Revenues that are junior and subordinate to the lien on Pledged
Revenues securing payment of the Parity Bonds. Such subordinate lien obligations may be
further secured by any other source of payment lawfully available for such purposes. Such
subordinate lien obligations will provide that they are payable from all or part of the Pledged
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Revenues only if and to the extent such amounts could otherwise be deposited to the Debt
Service Reserve Fund (for Reserve Fund Surety Policy obligations) or to the Surplus Fund.
Section 3.04 Declaration. It is hereby expressly declared that all revenues, receipts,
moneys and other properties hereby pledged are to be dealt with and disposed of under, upon and
subject to the terms, conditions, covenants, agreements, uses and purposes set forth in this
Indenture.
[END OF ARTICLE III]
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ARTICLE IV
FUNDS AND INVESTMENTS
Section 4.01
Funds:
(A)
(B)
(C)
(D)
(E)
(F)
Creation of Funds There are hereby created or confirmed the following
Pledged Revenue Fund;
Debt Service Fund;
Debt Service Reserve Fund;
Project Fund;
Rebate Fund; and
Surplus Fund.
Each Fund, other than the Surplus Fund and the Project Fund, shall be maintained by the Trustee
separate and apart from all other funds of the Authority. The Authority shall maintain its Surplus
Fund and Project Fund at a depository of the Authority's selection and in accordance with the
Tri-Party Agreement. The Pledged Revenue Fund, the Debt Service Fund and the Debt Service
Reserve Fund shall constitute trust funds which shall be held in trust by the Trustee solely for the
benefit of the Owners of the Tax Increment Contract Revenue Bonds.
Section 4.02 Pledged Revenue Fund. There is hereby created and established with the
Trustee a fund to be designated the "Pledged Revenue Fund." The Contract Tax Increments
shall be deposited into the Pledged Revenue Fund. Money in the Pledged Revenue Fund shall be
held in trust by the Trustee and applied in the following manner and order of priority:
(A)First, to the Debt Service Fund amounts necessary to make the amounts on
deposit therein equal to the interest and Principal Installments due on the Tax Increment
Contract Revenue Bonds in the period ending on the next March 1;
(B)Second, to the extent created in a Bond Resolution, to the particular Debt
Service Reserve Funds amounts required to attain the Reserve Requirement on a pro rata
basis (based upon the percentage of the Reserve Requirement for such Series of Bonds
compared to the Reserve Requirement for all Bonds);
(C)Third, to the payment of fees and expenses of the Trustee and Paying
Agent/Registrar; and
(D)Fourth, to the Surplus Fund for use by the Authority for any lawful
purpose. Moneys can be transferred from the Pledged Revenue Fund to the Surplus Fund
at any time provided that immediately prior to any such transfers the deposits required by
Sections 4.02(A) through (C) above have been made or provided for.
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Section 4.03 Debt Service Fund. There is hereby created and established with the
Trustee a fund to be designated the "Debt Service Fund." Money in the Debt Service Fund shall
be held in trust by the Trustee. The Authority shall deposit or cause to.be deposited into the Debt
Service Fund accrued interest on the Tax Increment Contract Revenue Bonds, capitalized interest
on the Tax Increment Contract Revenue Bonds, transfers from the Pledged Revenue Fund as
provided in Section 4.02, transfers from the Debt Service Reserve Fund as provided in Section
4.04, and, to the extent necessary, other Pledged Revenues in such amounts and at such times to
provide that amounts necessary to pay interest and Principal Installments, due on the Tax
Increment Contract Revenue Bonds. The Trustee shall transfer on each Interest Payment Date
and each Principal Installment Payment Date to the Paying Agent/Registrar such amounts in the
Debt Service Fund to pay Principal Installments and interest on the Tax Increment Contract
Revenue Bonds as the same become due. With respect to any Tax Increment Contract Revenue
Bonds that are subject to be paid and credited through The Depository Tnist Company, the
Trustee shall make all such transfers such that the Authority shall be in compliance with the
Principal and Interest Guidelines in the Operational Arrangement of the Depository Trust
Company, as amended from time to time. Otherwise, such transfers shall be made as may be
reasonably requested by the Owners of any Series of Tax Increment Contract Revenue Bonds.
Section 4.04 Debt Service Reserve Fund. Each Bond Resolution authorizing a Series of
Bonds may create and establish with the Trustee one or more funds to be designated a "Debt
Service Reserve Fund." A Debt Service Reserve Fund may be pledged to the payment of a
particular Series of Bonds and may be so designated (e.g. "Series 2012 Debt Service Reserve
Fund"). Money in a Debt Service Reserve Fund shall be held in trust by the Trustee and held
solely for the benefit of the Owners of the particular Series of Bonds for which it was created.
Each Debt Service Reserve .Fund shall initially be funded as provided in the respective Bond
Resolutions.
(A)If, on any Interest Payment Date or Principal Installment Payment Date,
after transferring funds to the Debt Service Fund as provided in Section 4.02, the Debt
Service Reserve Fund contains amounts less than the Reserve Requirement for a
particular Series of Bonds, the Trustee shall withdraw from the Pledged Revenue Fund
and deposit into each Debt Service Reserve Fund containing less than the Reserve
Requirement for. such Debt Service Reserve Fund, the amount required to attain the
Reserve Requirement for each Series of Bonds. If there are not sufficient funds in the
Pledged Revenue Fund to fund the Reserve Requirement of the various Debt Service
Reserve Funds, the Trustee shall deposit to each Debt Service Reserve Fund containing
less than the Reserve Requirement an amount calculated on a pro rata basis (based upon
the percentage of the sum of Reserve Requirements for each individual Series of Bonds
with Reserve Requirements compared to sum of the Reserve Requirements for all Series
of Bonds) into the Debt Service Reserve Fund all interest and income earned from the
investment of amounts credited to the Debt Service Reserve Fund until the Reserve
Requirements of the various Debt Service Reserve Funds are again attained.
(B)So long as a Debt Service Reserve Fund contains amounts at least equal to
the sum of the Reserve Requirements, all earnings on such Debt Service Reserve Fund
shall be transferred and deposited, as collected, into the Debt Service Fund.
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(C)Amounts deposited into a Debt Service Reserve Fund (i) shall be used to
pay interest on or Principal Installments of the Tax Increment Contract Revenue Bonds of
that particular Series when insufficient funds are available for such purpose in the Debt
Service Fund or (ii) may be applied toward the payment of interest on or Principal
Installments of Tax Increment Contract Revenue Bonds of the particular Series in
connection with the refunding or redemption of such Series of Tax Increment Contract
Revenue Bonds.
(D)The Authority expressly reserves the right at any time to satisfy all or part
of the Reserve Requirement for one or more of the Debt Service Reserve Funds by
obtaining for the benefit of one or more of the Debt Service Reserve Funds one or more
Reserve Fund Surety Policies. In the event the Authority elects to substitute at any time a
Reserve Fund Surety Policy for any funded amounts in a Debt Service Reserve Fund, it
may apply any bond proceeds thereby released, to the greatest extent permitted by law, to
any purposes for which any Bonds were issued and any other funds thereby released to
any purposes for which such funds may lawfully be used, including the payment of debt
service on any Bonds. The premium for any Reserve Fund Surety Policy shall be paid
from bond proceeds or other funds of the Authority lawfully available for such purpose.
Any Reserve Fund Surety Policy shall be authorized by resolution. All amounts deposited
in or required to be deposited in a Debt Service Reserve Fund may be used to pay
obligations incurred to providers of Reserve Fund Surety Policies, including amounts
advanced thereunder, interest on such advances and related costs and expenses.
Section 4.05 Project Fund. There is hereby created and established a fund to be
designated the "Project Fund" and held and maintained by the Authority. Subaccounts may be
established and created as the Authority deems appropriate.
The Project Fund and any subaccounts thereof, shall initially be funded as provided in the
Bond Resolutions. The money and securities in the Project Fund shall be applied as provided
herein.
Authority is hereby authorized and directed to make disbursements from the Project Fund
and any subaccounts thereof and to issue its checks therefor or otherwise pay for Project Costs
including the repayment of any loans, notes or other obligations used to finance Project Costs.
Section 4.06 Surplus Fund. Subject to the provisions of Section 4.02(D), there shall be
deposited into the Surplus Fund any amounts remaining in the Pledged Revenue Fund. After
transfer to the Surplus Fund, such amounts may be used by the Authority for any lawful purpose
free from the lien and pledge of this Indenture.
Section 4.07 Rebate Fund.
(A) Any provision hereof to the contrary notwithstanding, amounts credited to
the Rebate Fund shall be free and clear of any lien created by the Indenture. The Trustee
shall transfer from the Pledged Revenue Fund to the credit of the Rebate Fund each
amount directed by the Authority to be transferred thereto.
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(B)Within five days after each transfer of funds to the Rebate Fund necessary
to meet the requirements of Article VIII of the Bond Resolution or this Section 4.07, the
Trustee shall withdraw from the Rebate Fund and pay to the United States the balance of
the Rebate Fund. All payments to the United States pursuant to this Section shall be (i)
made by the Trustee for the account and in the name of the Authority, (ii) paid by check
mailed by registered mail (return receipt requested), addressed to the Internal Revenue
Service Center, Ogden, Utah 84201 (or such other Service Center as may be designated
by the Internal Revenue Service from time to time), and (iii) accompanied by the relevant
Internal Revenue Service Form 8038-T provided by the Authority.
(C)The Trustee shall preserve copies (either in original form or by image) of
all statements and forms received from the Authority pursuant to this Indenture and all
records maintained by it of transactions in the Rebate Fund and shall deliver such
materials to the Authority within 60 days following the discharge of the last of the Bonds.
(D)The Trustee may in good faith conclusively rely on the instructions of the
Authority with regard to any actions to be taken by it pursuant to this Section and shall
have no liability for any consequences of any failure of the Authority to supply accurate
or sufficient instructions.
(E)If at any time during the term of this Indenture, the Trustee or the
Authority desires to take any action that would otherwise be prohibited by the terms of
this Section, such person will be permitted to take such action only if it shall first obtain
and provide to the other person named herein an opinion of Bond Counsel (acceptable to
both the Trustee and the Authority) to the effect that such action will not adversely affect
the exclusion of interest on the Bonds from gross income of the holders thereof for
federal income tax purposes and shall be in compliance with the laws of the State of
Texas and the terms of this Indenture.
Section 4.08 Investments; Earnings. Monies deposited into the Pledged Revenue Fund,
the Debt Service Fund, and the Debt Service Reserve Fund shall be invested and reinvested in
Eligible Investments as directed in writing to the Trustee by the Authority; provided that all such
Eligible Investments shall be directed by the Authority in such manner that the money required
to be expended from any Fund will be available at the proper time or times.
(A)All investments and any profits realized from or interest accruing on such
investments shall belong to the Fund from which the monies for such investments were
taken (except as otherwise expressly provided in this Indenture). All losses on
investments shall be charged against the Fund to which such investments are credited.
The Trustee shall have the right to have sold in the open market a sufficient amount of
any such investments at any time that a Fund does not have sufficient uninvested funds
on hand to meet the obligations payable out of such Fund. The Trustee shall not be liable
or responsible for any loss resulting from any such investment or resulting from the sale
of any such investment as herein authorized.
(B)At the direction of the Authority, a portion of the investment income from
any Fund may be paid directly to the Rebate Fund, free and clear of the lien and pledge of
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this Indenture, for payment to the United States pursuant to Section 4.07 in order to
maintain the tax-exempt status of the Bonds.
(C)The Trustee may make any investment through its or an affiliate's
investment department, and the Trustee or such affiliate may receive compensation in
connection with such investments. As amounts invested are needed for disbursement
from any Funds, the Trustee shall cause a sufficient amount of the investments credited to
that Fund to be redeemed or sold and converted into cash to the credit of that Fund.
Securities transaction charges incident to any purchase, sale, or redemption of Eligible
Investments shall be charged to the Authority.
(D)The Authority by its execution of this Indenture covenants to restrict the
investment of money in the Funds created under this Indenture in such manner and to
such extent, if any, as may be necessary, after taking into account reasonable expectations
at the time the Bonds are delivered to their original purchaser, so that the Bonds will not
constitute arbitrage bonds under the Code and the Regulations, and the Trustee hereby
agrees to comply with the Authority's instructions with respect to the investment of
money in the Funds created under this Indenture.
(E)The Authority has covenanted to provide the Trustee with written
instructions to assure that any amounts that, in accordance with the Code and applicable
regulations, are required to be invested at a restricted yield will be invested either (i) in
Exempt Securities or (ii) at a yield that is not materially higher than the yield on the
Bonds, determined in accordance with the Code and applicable Regulations, unless in the
opinion of Bond Counsel, investment of such at a higher rate will not adversely affect the
exclusion from gross income of interest on the Tax Increment Contract Revenue Bonds
for federal income tax purposes. For the purpose of applying this Section, amounts on
deposit in each Fund shall be accounted for on a first in, first out basis. The Trustee, at
the Authority's direction, is authorized to yield restrict any investment in accordance with
Article VIII of the Bond Resolutions.
(F)For the purpose of determining the amount on deposit to the credit of any
such Fund, obligations in which money in such Fund shall have been invested shall be
valued at the Fair Market Value. The Trustee shall provide a valuation of the Eligible
Investments in the Funds established under this Indenture as of the last Business Day of
each month.
[END OF ARTICLE IV]
HOU:3210582.5
ARTICLE V
COVENANTS OF THE AUTHORITY
Section 5.01 Payment of Tax Increment Contract Revenue Bonds and Performance of
Obligations. The Authority covenants to promptly pay or cause to be paid the principal of,
redemption premium, if any, and interest on the Tax Increment Contract Revenue Bonds as the
same become due and payable, whether at maturity or by prior redemption, in accordance with
the terms of the Tax Increment Contract Revenue Bonds and the Bond Resolutions; to pay when
due all fees, charges and other amounts due to the Trustee and the Paying Agent/Registrar for the
discharge of their duties hereunder; and to faithfully keep and perform all of its covenants,
undertakings and agreements contained in this Indenture, the Tri-Party Agreement, the Bond
Resolutions and the Tax Increment Contract Revenue Bonds.
Section 5.02 Recordation and Execution of Security Instruments. The Authority
covenants to cause this Indenture, any supplemental indentures, and all other security
instruments, financing statements and supplements thereto that may be necessary, to be filed,
recorded, and refiled, in such manner, at such times and in such places as may be required by law
in order to fully preserve and protect the rights and security of the Owners of the Tax Increment
Contract Revenue Bonds and to perfect and preserve the lien of this Indenture. Without limiting
the generality of the foregoing, the Authority shall execute and deliver such additional
instruments and perform such additional acts as may be necessary and proper after the execution
of this Indenture and to transfer to any successor Trustee or Trustees the assets, powers,
instruments and funds held in trust hereunder and to confirm the lien of this Indenture with
respect to any Bond or Tax Increment Contract Revenue Bonds, and shall take all action that
may at any time be necessary, in the opinion of the Trustee, to secure the interests of the Owners
of the Tax Increment Contract Revenue Bonds.
Section 5.03 Title Encumbrances of Pledged Revenues. The Authority covenants that it
has good and indefeasible title to the Contract Tax Increments, subject to the assignments and
pledges contained herein. So long as any Tax Increment Contract Revenue Bonds remain
Outstanding, except as permitted by Sections 3.02 and 3.03 of this Indenture, the Authority
covenants not to sell, transfer, assign, pledge, encumber, mortgage or otherwise dispose of,
directly or indirectly, by merger or otherwise, or cause or suffer same, or create or allow to
accrue or exist any lien upon, all or any part of its interest in the Pledged Revenues or any
portion thereof, except for the lien of this Indenture.
Section 5.04 Pledged Revenues Not Encumbered. (a) The Pledged Revenues are not in
any manner pledged to the payment of any debt or obligation of the Authority other than the Tax
Increment Contract Revenue Bonds. The Authority covenants that it will not in any manner
pledge or further encumber the Pledged Revenues unless such pledge or encumbrance is junior
and subordinate to the lien and pledge hereunder securing the Tax Increment Contract Revenue
Bonds.
(b) Provided, however, the lien on, pledge of, and rights in and to the Contract
Tax Increments established, made, and granted in Article II of this Indenture and this
Section 5.04 constitutes a lien thereon, subject only to the rights, if any, of the holders of
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bonds or other obligations that have been heretofore or are hereafter issued by a
Participant that are payable from and secured by a general levy of ad valorem taxes
throughout the taxing jurisdiction of the Participant.
Section 5.05 Collection of Contract Tax Increments. Subject to the provisions of
applicable law and the Tri-Party Agreement, the Authority covenants and agrees to use its best
efforts to cause each Participant to pay to the City, when due, all Contract Tax Increments to
provide for the payment of principal of and interest on the Tax Increment Contract Revenue
Bonds.
Section 5.06 Amendment of Tri-Party Agreement. The Authority covenants not to
cause any amendment of the Tr-Party Agreement that will in any manner materially impair the
rights of the Owners of the Tax Increment Contract Revenue Bonds.
[END OF ARTICLE V]
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ARTICLE VI
DEFAULT AND REMEDIES
Section 6.01 Events of Default. An Event of Default hereunder shall consist of any of
the following acts or occurrences:
(A)failure to pay when due Principal Installments or interest on any Tax
Increment Contract Revenue Bond; or
(B)failure to deposit to the Debt Service Fund money sufficient for the
payment of any Principal. Installments or interest payable on the Tax Increment Contract
Revenue Bonds by no later than the date when such Principal Installment or interest
becomes due and payable.
Section 6.02 Notices. In order to provide the Authority with information with respect
to its obligations under this Indenture, the Trustee shall provide the Authority the following
notices:
(A)Notice of any draws upon any Debt Service Reserve Fund which are
required to be transferred to the Debt Service Fund for the payment of Principal
Installments of or interest on any Tax Increment Contract Revenue Bonds, together with
the description of the amount drawn; and
(B)Notice of transfers to the Surplus Fund pursuant to Section 4.02 and
Section 4.06.
Section 6.03 Notice of Default. The Trustee shall also be required to give reasonably
prompt notice to the Authority of the occurrence of any Event of Default hereunder of which the
Trustee has actual knowledge.
Section 6.04 Remedies in General. If an Event of Default hereunder shall occur and be
continuing, then, in addition to all of the other rights and remedies granted to the Trustee
hereunder, the Trustee in its discretion, subject to the provisions of this Indenture, may proceed
to protect and enforce its rights and the rights of the Owners of Tax Increment Contract Revenue
Bonds by suit, action or proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this Indenture, the Bond Resolutions or
the Tax Increment Contract Revenue Bonds or in aid of the execution of any power granted in
this Indenture or for the enforcement of any other legal, equitable or other remedy, as the
Trustee, being advised by counsel, shall deem most effectual to protect and enforce any of the
rights of the Trustee or such Owners of the Tax Increment Contract Revenue Bonds, including,
without limitation, the right to seek a writ of mandamus issued by a court of competent
jurisdiction compelling the members of the Board or other officers of the Authority or any
Participant to make payment of the Contract Tax Increments (but only from and to the extent of
the sources provided in this Indenture and the Participant Contracts) or to observe and perform
such covenant, obligations or conditions of this Indenture or the Tri-Party Agreement.
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Section 6.05 Appointment of Receivers. If an Event of Default hereunder shall occur
and be continuing, and upon filing of a bill in equity or commencement of other judicial
proceedings to enforce the rights of the Trustee and the Owners hereunder, the Trustee shall be
entitled as a matter of right, and to the extent permitted by law, to the appointment of a receiver
or receivers of the Pledged Revenues and the income, rents, profits and use thereof pending such
proceedings, with such powers as the court making such appointment shall confer.
Section 6.06 Trustee May Act Without Possession of Tax Increment Contract Revenue
Bonds. All rights of action under this Indenture or under any Tax Increment Contract Revenue
Bonds may be enforced by the Trustee without possession of any of the Tax Increment Contract
Revenue Bonds or the production thereof on any trial or other proceedings relative thereto, and
any such suit or proceedings instituted by the Trustee shall be brought in its name, as Trustee for
the ratable benefit of the Owners of the Tax Increment Contract Revenue Bonds, subject to the
provisions of this Indenture.
Section 6.07 Trustee as Attorney in Fact. The Trustee is hereby appointed (and the
Owners of the Tax Increment Contract Revenue Bonds, by taking and owning same from time to
time, shall be deemed to have so appointed the Trustee) the true and lawful attorney in fact of the
Owners of the Tax Increment Contract Revenue Bonds, to make or file, in the names of the
Owners of the Tax Increment Contract Revenue Bonds, or in behalf of all Owners of the Tax
Increment Contract Revenue Bonds as a class, any proof of debt, amendment to proof of debt,
petition or other document, and to do and perform any and all acts and things for and in the name
of the Owners of the Tax Increment Contract Revenue Bonds as a class as may be necessary or
advisable, in the judgment of the Trustee, in order to have the claims of the Owners of the Tax
Increment Contract Revenue Bonds against the Authority approved in any equity receivership,
insolvency, liquidation, bankruptcy, reorganization or other proceedings to which the Authority
shall be a party and to receive payment of or on account of such claims. Any such receiver,
assignee, liquidator or trustee is hereby authorized by each of the Owners to make such payments
to the Trustee, and in the event that the Trustee shall consent to the making of such payments
directly to the Owners, to pay to the Trustee any amount due for compensation and expenses of
the Trustee, including counsel fees, incurred up to the date of such distribution, and the Trustee
shall have full power of substitution and delegation in respect of any such powers.
Section 6.08 Remedies Not Exclusive. No remedy herein conferred upon or reserved to
the Trustee 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 Tax Increment Contract Revenue Bonds, or now or hereafter existing at
law or in equity or by statute. No delay or omission to exercise any right or power accruing upon
any default shall impair any such right or power or shall be construed to be a waiver of any such
default or acquiescence therein, and every such right and power may be exercised from time to
time and as often as may be deemed expedient.
Section 6.09 Limitation on Suits. All rights of action in respect of this Indenture shall
be exercised only by the Trustee, and no Owner of any Bond secured hereunder shall have any
right to institute any suit, action or proceeding at law or in equity for the appointment of a
receiver or for any other remedy hereunder or by reason hereof, unless and until the Trustee shall
have received written request of the Owners of not less than twenty-five percent (25%) in
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aggregate principal amount of the Tax Increment Contract Revenue Bonds then Outstanding and
shall have been furnished reasonable indemnity and shall have refused or neglected for ten (10)
days thereafter to institute such suit, action or proceedings. The making of such request and the
furnishing of such indemnity shall in each and every case be conditions precedent to the
execution and enforcement by any Owner of any Bond of the powers and remedies given to the
Trustee hereunder and to the institution and maintenance by any such Owner of any action or
cause of action for the appointment of a receiver or for any other remedy hereunder, but the
Trustee may, in its discretion, and when duly requested in writing by the Owners of not less than
twenty-five percent (25%) in aggregate principal amount of the Tax Increment Contract Revenue
Bonds then Outstanding and when furnished indemnity satisfactory to protect it against
expenses, charges and liability shall, forthwith, take such appropriate action by judicial
proceedings or otherwise in respect of any existing default on the part of the Authority as the
Trustee may deem expedient in the interest of the Owners of the Tax Increment Contract
Revenue Bonds.
Nothing contained in this Article, however, shall affect or impair the right of any Owner,
which shall be absolute and unconditional, to enforce the payment of the Principal Installments
and interest on the Tax Increment Contract Revenue Bonds of such Owner, but only out of the
moneys for such payment as herein provided, or the obligation of the Authority, which shall also
be absolute and unconditional, to make payment of the Principal Installments and interest on the
Tax Increment Contract Revenue Bonds issued hereunder, but only out of the fends provided
herein for such payment, to the respective Owners thereof at the time and place stated in said Tax
Increment Contract Revenue Bonds.
Section 6.10 Right of Owners of the Tax Increment Contract Revenue Bonds to Direct
Proceedings. Notwithstanding any provision of this Indenture to the contrary, the Owners of
more than fifty percent (50%) in aggregate principal amount of the Tax Increment Contract
Revenue Bonds then Outstanding shall have the right, at any time, by an instrument or
instruments in writing executed and delivered to the Trustee, to direct the time, method and place
of conducting all proceedings to be taken in connection with the enforcement of the terms and
conditions of this Indenture or for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee or any other proceedings hereunder; provided, however, that
such direction shall not be contrary to law or the provisions of this Indenture, and the Trustee
shall have the right to decline to follow any such direction if the Trustee in good faith shall
determine that the proceeding so directed would involve it in personal liability or would be
unjustly prejudicial to the Owners of the Tax Increment Contract Revenue Bonds not consenting.
Section 6.11 Restoration of Rights and Remedies. If the Trustee or any Owner of a
Bond has instituted any proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been determined
adversely to the Trustee or to such Owner of a Bond, then and in every such case the Authority,
the Trustee and the Owners of the Tax Increment Contract Revenue Bonds shall, subject to any
determination in such proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and the Owners of the Tax
Increment Contract Revenue Bonds shall continue as though no such proceeding had been
instituted.
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Section 6.12 Waiver of Stay or Extension Laws. To the extent that it may lawfully do
so, the Authority covenants that it will not at any time insist upon, plead or in any manner
whatsoever claim or take the benefit or advantage of any stay or extension law whenever or
wherever enacted, which may affect the covenants or the performance of this Indenture. The
Authority also covenants that it will not otherwise hinder, delay or impede the execution of any
power herein granted to the Trustee.
Section 6.13 Delay or Omission Not Waiver. No delay or omission of the Trustee or of
any Owner of any Bond to exercise any right or remedy accruing upon any Event of Default
hereunder shall impair any such right or remedy or constitute a waiver of any such Event of
Default or an acquiescence therein. Every right and remedy given by this Article or by law to the
Trustee or to the Owners may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Owners of the Tax Increment Contract Revenue Bonds, as the
case may be.
[END OF ARTICLE VI]
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ARTICLE VII
DISCHARGE
Section 7.01 Discharge by Payment. When all Tax Increment Contract Revenue Bonds
have been paid in full as to principal and as to interest and premium, if any, or when all Tax
Increment Contract Revenue Bonds have become due and payable, whether at maturity or by
prior redemption or otherwise, and the Authority shall have provided for the payment of the
whole amount due or to become due on all Tax Increment Contract Revenue Bonds then
outstanding, including all interest which has accrued thereon or which may accrue to the date of
maturity or redemption by depositing with the Trustee or the Paying Agent/Registrar, for
payment of such outstanding Tax Increment Contract Revenue Bonds and the interest thereon
and any premium which may be due thereon, the entire amount due or to become due thereon, or
amounts and investments sufficient to provide for such payment as provided in the Bond
Resolutions, and the Authority shall also have paid or caused to be paid all sums payable
hereunder by the Authority, including the compensation due or to become due the Trustee, then
the Trustee shall, upon receipt of a letter of instructions from the Authority requesting the same,
discharge and release the lien of this Indenture and execute and deliver to the Authority such
releases or other instruments as shall be required to release the lien hereof.
Section 7.02 Discharge by Deposit. The Authority may discharge its obligation to the
Owners of any or all of the Tax Increment Contract Revenue Bonds to pay principal, interest and
redemption premium (if any) thereon in any manner then permitted by law, including, but not
limited to, by depositing with any paying agent for such Tax Increment Contract Revenue Bonds
either: (i) cash in an amount equal to the principal amount and redemption premium, if any, of
such Tax Increment Contract Revenue Bonds plus interest thereon to the date of maturity or
redemption, or (ii) pursuant to an escrow or trust agreement, cash and/or Investments in principal
amounts and maturities and bearing interest at rates sufficient (in the opinion of an independent
certified public accountant) to provide for the timely payment of the principal amount and
redemption premium, if any, of such Tax Increment Contract Revenue Bonds plus interest
thereon to the date of maturity or redemption; provided, however, that if any of the Tax
Increment Contract Revenue Bonds are to be redeemed prior to their respective dates of
maturity, provision shall have been made for giving notice of redemption as provided in the
Bond Resolution authorizing such Tax Increment Contract Revenue Bonds. Upon such deposit,
such Tax Increment Contract Revenue Bonds shall no longer be regarded to be Outstanding or
unpaid.
For the purpose of this Section 7.02, "Investments" shall mean:
(a)direct noncallable obligations of the United States, including .obligations
that are unconditionally guaranteed by the United States;
(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 Authority authorizes the discharge by deposit
of any or all of the Tax Increment Contract Revenue Bonds, are rated as to investment
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quality by a nationally recognized investment rating firm not less than AAA or its
equivalent; and
(c) noncallable obligations of a state or an agency or a county, municipality,
or other political subdivision of a state that have been refunded and that, on the date the
Authority authorizes the discharge by deposit of any or all of the Tax Increment Contract
Revenue Bonds, are rated as to investment quality by a nationally. recognized investment
rating firm of not less than AAA or its equivalent.
[END OF ARTICLE VII]
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ARTICLE VIII
THE TRUSTEE
Section 8.01 Acceptance of Trusts. The Trustee, for itself and its successors and
assigns, hereby accepts the trusts under this Indenture, but only upon the following terms and
conditions set forth in this Article.
(a). Notwithstanding any provision of the Indenture to the contrary, prior to an
Event of Default hereunder, and after the curing of any such Event of Default, the Trustee
shall not be liable for the performance of any duties, except such duties as are specifically
set forth in this Indenture, and no implied covenants or obligations shall be read into this
Indenture against the Trustee. In case of an Event of Default which has not been cured,
the Trustee shall exercise such of the rights and powers vested in it by this Indenture and
shall use the same degree of care and skill in its exercise thereof as a prudent person
would exercise or use under the circumstances in the conduct of his own affairs.
(b)In the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely upon the truth, completeness and accuracy of the letters of instruction,
statements, certificates, opinions, certified resolutions and other certified showings
conforming to the requirements of this Indenture.
(c)The Trustee may execute any of the trusts or powers hereof and perform
any duties required of it, by or through attorneys or agents selected by it with reasonable
care, and shall be entitled to, and shall be protected in relying upon, advice of counsel
concerning all matters of trust hereof and its duties hereunder, and may in all cases pay
such reasonable compensation as it shall deem proper to all such attorneys and agents as
may reasonably be required and employed in connection with the trusts hereof, and the
Trustee shall not be responsible for the acts or negligence of such attorneys, agents or
counsel, if selected with reasonable care.
(d)The Trustee shall not be responsible for any recitals herein, in the Bond
Resolutions or in the Tax Increment Contract Revenue Bonds. The Trustee may require
of the Authority full information and advice as to the performance of the covenants,
conditions and agreements contained in this Indenture. The recitals and statements of fact
and warranties contained in this Indenture, the Bond Resolutions and in the Tax
Increment Contract Revenue Bonds shall be taken as statements by the Authority and
shall not be considered as made by or as imposing any obligation or liability upon the
Trustee.
(e)Except as otherwise provided in this. Indenture, the Trustee shall not be
bound to recognize any person as an Owner of any Bond or to take action at such persons
request, unless such person's name appears as the Registered Owner of such Bond in the
Register.
(f)Except as otherwise expressly provided by the provisions of this
Indenture, the Trustee shall not be obligated and may not be required to give or furnish
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any notice, demand, report, request, reply, statement, advice or opinion to. any Owner of
any Bond or to the Authority or any other person, and the Trustee shall not incur any
liability for its failure or refusal to give or furnish same unless obligated or required to do
so by express provision of the provisions hereof.
(g). Nothing herein contained shall relieve the Trustee from liability for its
own grossly negligent action or failure to act or its own willful misconduct, except that
the Trustee shall not incur any liability (i) for any error of judgment made in good faith
by a responsible officer or responsible officers thereof, unless it shall be proved that it
was grossly negligent in ascertaining the pertinent facts, or (ii) in respect of any action
taken or omitted to be taken by it in good faith in accordance with the direction of the
Owners of the percentage of the Tax Increment Contract Revenue Bonds specified herein
relating to the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred upon the Trustee under
this Indenture.
(h)None of the provisions contained in this Indenture shall require the
Trustee to advance, expend or risk its own funds or to otherwise incur financial liability
in the performance of any of its duties or in the exercise of any of its rights or powers, if
there is reasonable ground for believing that the repayment of such funds or liability is
not reasonably assured to it by the security afforded to it by the terms of this Indenture.
(i)The Trustee shall have no responsibility with respect to any information in
any offering memorandum or other disclosure material distributed . with respect to the Tax
Increment Contract Revenue Bonds, and the Trustee shall have no responsibility for
compliance with securities laws in connection with the issuance and sale of the Tax
Increment Contract Revenue Bonds.
) In the event the Trustee shall receive inconsistent or conflicting requests
and indemnity from two or more groups of Owners, each representing less than a
majority of the aggregate principal amount of the Tax Increment Contract Revenue
Bonds then Outstanding, the Trustee, in its sole discretion, may determine what action, if
any, shall be taken.
(k) Except as otherwise especially provided by the provisions of this
Indenture, the Trustee shall not be obligated and may not be required to give or furnish
any notice, demand, report, request, reply, statement, advice or opinion to any Owner of
any Tax Increment Revenue Bond or to the Authority or any other person, and the
Trustee shall not incur any liability for its failure or refusal to give or furnish same unless
obligated or required to do so by express provisions hereof.
(1) The Trustee shall not be required to give any bond or surety with respect
to the performance of its duties or the exercise of its powers under this Indenture.
(m) Until termination of this • Indenture, the Trustee shall file continuation
statements at the Authority's expense as required to continue in effect the Uniform
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Commercial Code financing statement filed with the Secretary of State of the State of
Texas listing the Trustee as the secured party and the Authority as the debtor.
Section 8.02 Reliance by Trustee. To the extent not prohibited by this Article, the
trustee may rely, and shall be protected in acting upon, any letters of instruction, statements,
certificates, certified resolutions, opinions, notices, consents, orders, appraisals, reports, policies,
bonds or other papers or documents believed by it to be genuine and to have been signed or
presented to it by the proper person or persons, and the Trustee may consult with counsel and the
opinion of such counsel shall be full and complete authorization and protection in respect of any
action taken or suffered by the Trustee hereunder in good faith and in conformity with the
opinion of such counsel. Notwithstanding the foregoing, upon receipt by the Trustee of
documents furnished to it by the Authority which are specifically required to be delivered under
this Indenture, the Trustee shall examine the same to determine whether they conform to the
requirements of this Indenture; however, the Trustee shall have no obligation to analyze the same
or evaluate their substance.
Section 8.03 Certificate of the Authority as Proof. Whenever in the administration of
the trusts of this Indenture, the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering any action hereunder, then, in the absence of
bad faith on the part of the Trustee, and unless other evidence in respect thereof be herein
specifically prescribed, and unless an Event of Default hereunder, to the actual knowledge of the
Trustee, shall have occurred and be continuing, such matter may be deemed to be conclusively
proved and established by a certificate of the Authority, executed by the Chairman of the
Authority and delivered to the Trustee, and such certificate shall be full warranty to the Trustee
for any action taken or suffered by it under the provisions of this Indenture in reliance thereon.
Section 8.04 Trustee May Own Tax Increment Contract Revenue Bonds. The Trustee,
in its individual or any other capacity, may become the owner or pledgee of Tax Increment
Contract Revenue Bonds or other certificates or evidences of ownership or pledge thereof issued
hereunder, with the same rights it would have if it were not the Trustee.
Section 8.05 Compensation of Trustee. The Authority shall pay to the Trustee in a
timely manner all reasonable fees, charges and expenses of the Trustee (including the reasonable
fees, charges and expenses of its agents and counsel) for the administration and execution of the
trusts hereby created and the performance of its powers and duties hereunder, including the
ordinary and extraordinary services performed by the Trustee under this Indenture. Whenever the
Trustee incurs expenses or renders services in connection with any bankruptcy or insolvency
proceeding, such expenses (including the fees and expenses of its counsel) and the compensation
of such services are intended to constitute expenses of administration under any bankruptcy or
insolvency law or law relating to creditors' rights generally.
Section 8.06 Removal of Trustee. The Trustee may be removed at any time by an
instrument or concurrent instruments in writing, signed by the Owners of a majority in principal
amount of the Tax Increment Contract Revenue Bonds then Outstanding and delivered to the
Trustee, with notice thereof given to the Authority.
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Section 8.07 Resignation of Trustee. The Trustee may at any time resign and be
discharged from the trusts hereby created by giving written notice to the Authority and by
providing written notice to the Owners of its intended resignation at least sixty (60) days in
advance thereof. Such notice shall specify the date on which such resignation shall take effect
and shall be sent by first class mail, postage prepaid to each Registered Owner of Tax Increment
Revenue Bond. Resignation by the Trustee shall not take effect unless and until a successor to
such Trustee shall have been appointed as hereinafter provided.
Section 8.08 Appointment of Successor Trustee. In case the Trustee hereunder shall
resign, or shall be removed or dissolved, or shall be in the course of dissolution or liquidation, or
shall otherwise become incapable of acting hereunder, or in case the Trustee shall be taken under
control of any public officer or officers or a receiver appointed by a court, a successor may be
appointed by the Owners of a majority in principal amount of the Tax Increment Contract
Revenue Bonds then Outstanding, by an instrument or concurrent instruments in writing, signed
by such Owners or their duly authorized representatives and delivered to the Trustee, with notice
thereof given to the Authority; provided, however, that in any of the events above mentioned, the
Authority may nevertheless appoint a temporary Trustee to fill such vacancy until a successor
shall be appointed by the Owners in the manner above provided, and any such temporary Trustee
so appointed by the Authority shall immediately and without further act be automatically
succeeded by the successor to the Trustee appointed by the Owners. The Authority shall provide
written notice to the Owners of the appointment of any successor Trustee, whether temporary or
permanent, in the manner provided in the preceding Section of this Indenture for providing
notice of the resignation of the Trustee. Any successor Trustee or temporary Trustee shall be a
trust company or bank in good standing located in or incorporated under the laws of the State of
Texas duly authorized to exercise trust powers and subject to examination by federal or state
authority, having a reported capital and surplus of not less than $100,000,000.
In the event that no appointment of a successor Trustee is made by the Owners or by the
Authority pursuant to the foregoing provisions of this Section at the time a vacancy in the office
of the Trustee shall have occurred, the Owner of any Bond issued hereunder or the retiring
Trustee may apply to any court of competent jurisdiction for the appointment of a successor
Trustee, and such court may thereupon, after such notice as it shall deem proper, if any, appoint a
successor Trustee.
Section 8.09 Powers of Successor Trustee. Each successor Trustee appointed
hereunder shall execute, acknowledge and deliver to its predecessor and to the Authority, an
instrument in writing accepting such appointment hereunder, and thereupon such successor
Trustee, without any further act, deed or conveyance, shall become fully vested with all the
estates, properties, rights, powers, trusts, duties and obligations of its predecessor, but such
predecessor Trustee shall, nevertheless, on the written request of the Authority, execute and
deliver an instrument transferring to such successor Trustee all the estates, properties, rights,
powers, trusts, duties and obligations of such predecessor hereunder. Each predecessor Trustee
shall immediately deliver all properties, securities and moneys held by it to its successor;
provided, however, that before any such delivery is required or made, all proper fees, advances
and expenses of the predecessor Trustee shall be paid in full. Should any deed, conveyance or
instrument in writing be required from the Authority by any successor Trustee for properties,
rights, powers, trusts, duties and obligations hereby vested or intended to be vested in the
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predecessor Trustee, any and all such deeds, conveyances and instruments in writing shall, on
request, be executed, acknowledged and delivered by the Authority. The resignation of any
Trustee, appointing a successor Trustee hereunder, together with all deeds, conveyances and
other instruments provided for in this Article shall, at the expense of the Authority, be properly
filed or recorded and a copy thereof shall be filed with such successor Trustee, together with a
statement showing such filing or recordation..
Section 8.10 Merger, Conversion or Consolidation of Trustee. Notwithstanding any
provision hereof to the contrary, any corporation or association into which the Trustee may be
merged or converted, or with which it may be consolidated, or any corporation succeeding to all
or substantially all of the corporate trust business of the Trustee, or any corporation or
association resulting from any merger, conversion or consolidation to which the Trustee shall be
a party, shall be the successor Trustee under this Indenture without the execution or filing of any
instrument or any other act on the part of any of the parties hereto.
Section 8.11 Funds Transfer. If any payment is to be made by the Trustee to the
Authority or its designee by funds transfer, the Authority agrees to enter into an agreement
concerning funds transfer instructions in a form to be provided by the Trustee. Until the
Authority executes such an agreement, the Trustee shall not be required to make any payment
under the Indenture to the Authority or its designee by funds transfer.
[END OF VIII]
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ARTICLE IX
MODIFICATION OF INDENTURE
Section 9.01 Supplemental Indentures Not Requiring Consent of Owners of the Tax
Increment Contract Revenue Bonds. The Authority and the Trustee may, without the consent of
the Owners of any of the Tax Increment Contract Revenue Bonds, enter into one or more
supplemental indentures, which shall form a part hereof, for any one or more of the following
purposes:
(a)to cure any ambiguity, inconsistency or formal defect or omission in this
Indenture;
(b)to grant to or confer upon the Trustee for the benefit of the Owners of the
Tax Increment Contract Revenue Bonds any additional rights, remedies, powers or
authority that may lawfully be granted to or conferred upon the Owners of the Tax
Increment Contract Revenue Bonds or the Trustee or either of them;
(c)to subject to the lien of this Indenture additional revenues; properties or
collateral;
(d)to modify, amend or supplement this Indenture or any supplemental
indenture in such manner as to provide further assurances that interest on the Tax
Increment Contract Revenue Bonds will, to the greatest extent legally possible, be
excludable from gross income for federal income tax purposes;
(e)to obtain bond insurance for any Tax Increment Contract Revenue Bonds;
(f)to provide for one or more Reserve Fund Surety Policies;
(g)to permit the assumption of the Authority's obligations hereunder by any
other entity that may become the legal successor to the Authority; and
(h)to define or redefine the Reserve Requirement or clarify the relationship
between particular Debt Service Reserve Funds and particular series of Bonds.
provided, however, that no provision in such supplemental indenture shall be inconsistent with
this Indenture or shall impair in any manner the rights of the Owners of the Tax Increment
Contract Revenue Bonds.
Section 9.02 Supplemental Indentures Requiring Consent of Owners of the Tax
Increment Revenue Bonds. Except as otherwise provided in the preceding Section, any
modification, change or amendment of this Indenture may be made only by a supplemental
indenture adopted and executed by the Authority and the Trustee with the consent of the Owners
of not less than a majority of the aggregate principal amount of the Tax Increment Contract
Revenue Bonds then Outstanding.
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Notwithstanding the preceding paragraph of this Section, no modification, change or
amendment to this Indenture shall, without the consent of the Owner of each Bond so affected,
extend the time of payment of the Principal Installments or interest thereon, or reduce the
Principal Installments or premium, if any, thereon; or the rate of interest thereon, or make the
Principal Installments or interest thereon payable in any coin or currency other than that
hereinbefore provided, or deprive such Owner of the lien hereof on the revenues pledged
hereunder. Moreover, without the consent of the Owner of each Bond then Outstanding, no
modification, change or amendment to this Indenture shall permit the creation of any lien on the
revenues pledged hereunder equal or prior to the lien hereof, or reduce the aggregate principal
amount of Tax Increment Contract Revenue Bonds, the Owners of which are required to approve
any such modification, change or amendment of this Indenture.
Section 9.03 Consents. Consents required pursuant to this Article shall be valid only if
given following the giving of notice by or on behalf of the Authority requesting such consent,
setting forth the substance of the supplemental indenture in respect of which such consent is
sought and stating that copies thereof are available at the office of the Trustee for inspection, to
the Owners of Tax Increment Contract Revenue Bonds whose consent is required in accordance
with the provisions of this Article. Such notice shall be given by sending such notice by first-
class mail; postage prepaid, to the registered Owners of such Tax Increment Contract Revenue
Bonds. Any consent or other action by an Owner of any Bond in accordance with this Article
shall bind every future owner of the same Bond and the Owner of any Bond issued in exchange
therefor or in lieu thereof.
[END OF ARTICLE IX]
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ARTICLE X
GENERAL PROVISIONS
Section 10.01 Proof of Execution of Writings and Ownership. Any instrument provided
in this Indenture to be signed or executed by the Owners of all or any portion of the Tax
Increment Contract Revenue Bonds may be in any number of writings of similar tenor and may
be signed or executed by such Owners in person or by their duly authorized representatives.
Proof of the execution of any such instrument, or of the writing appointing any such agent, or of
the ownership of any Bond, shall be sufficient for any of the purposes of this Indenture and shall
be conclusive in favor of the Authority and the Trustee with respect to any actions taken by
either under such instruments if:
(a)the fact and date of the execution by any person of any such instrument is
proved by (i) a certificate of any officer of any jurisdiction who by law has power to take
acknowledgments of deeds within such jurisdiction, to the effect that the person signing
such instrument acknowledged before him the execution thereof, or (ii) an affidavit of a
witness of such execution; and
(b)the ownership of any Bond registered as to both principal and interest is
proved by the registration books kept by the Paying Agent/Registrar.
Section 10.02 Benefits of Indenture. The covenants, stipulations and agreements
contained in this Indenture are and shall be for the sole and exclusive benefit of the parties
hereto, their successors and assigns, and the Owners of the Tax Increment Contract Revenue
Bonds, and nothing in this Indenture expressed or implied shall be construed to confer upon or
give to any other person any right, remedy or claim under or by reason of this Indenture.
Section 10.03 No Individual Liability. No covenant or agreement contained in the Tax
Increment Contract Revenue Bonds or in this Indenture shall be deemed to be the covenant or
agreement of any member of the Board of Directors of the Authority or any officer, agent,
employee or representative of the Authority in his individual capacity, and neither the officers,
agents, employees or representatives of the Authority nor any person executing the Tax
Increment Contract Revenue Bonds shall be personally liable thereon or be subject to any
personal liability or accountability by reason of the issuance thereof, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability being expressly released and waived as a condition of and in
consideration for the execution of this Indenture, the adoption of the Bond Resolutions and the
issuance of the Tax Increment Contract Revenue Bonds.
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Section 10.04 Notice. Any notice, demand, direction, request, or other instrument
authorized or required by this Indenture to be given to or filed with the Trustee or the Authority
shall be deemed to be effective for all purposes of this Indenture if and when sent by (i) personal
delivery, to the persons designated below at the address designated below, (ii) registered or
certified mail, postage prepaid, to the address specified below or (iii) facsimile transmission to
the number specified below with confirmation of receipt by telephone, or to such other person, at
such other address or to such other number as may be designated in writing by the parties:
Trustee: Regions Bank
Corporate Trust Services
1717 St. James Place, Suite 500
Houston, TX 77056
Attn: Doug Milner
Facsimile: (713) 693-5348
Telephone: (713) 693-5303
Authority: Development Authority of Pearland
c/o the City of Pearland
3519 Liberty Drive
Pearland, Texas 77581
Attn: City Manager
Facsimile: (281) 652-1708
Telephone: (281) 652-1663
Section 10.05 Governing Law. This Indenture shall be governed in all respects,
including validity, interpretation and effect, by, and shall be enforceable in accordance with, the
laws of the State of Texas.
Section 10.06 Severability. If any provision of this Indenture shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining portions shall not in any
way be affected or impaired. In case any covenant, stipulation, obligation or agreement contained
in the Tax Increment Contract Revenue Bonds, the Bond Resolutions or in this Indenture shall
for any reason be held to be usurious or in violation of law, then such covenant, stipulation,
obligation or agreement shall be deemed to be the covenant, stipulation, obligation or agreement
of the Authority to the full extent permitted by law.
Section 10.07 Successors and Assigns. This Agreement shall be binding upon the
Authority and the Trustee and their successors and assigns.
Section 10.08 Execution in Several Counterparts. This Indenture may be simultaneously
executed in several counterparts all of which shall constitute one and the same instrument and
each of which shall be, and shall be deemed to be, an original.
T1
HOU:3210582.5
IN WITNESS WHEREOF, the Authority and the Trustee have caused this Indenture to
be signed, sealed and attested on their behalf by their duly authorized representatives, all as of
the date first hereinabove written.
DEVELOPMENT AUTHORITY OF PEARLAND
Chair
ATTEST:
Secretary
By:_
Title:
Trustee
ATTEST:
By:_
Title:
(SEAL)
37
HOU:3210582.2
IN WITNESS WHEREOF, the Authority and the Trustee have caused this Indenture to
be signed, sealed and attested on their behalf by their duly authorized representatives, all as of
the date first hereinabove written.
DEVELOPMENT AUTHORITY OF PEARLAND
Chair
ATTEST:
Secretary
REGIONS BANK, Tr stee
By:
Title: VICE PRESIf N
Trustee.
ATTEST:
(SEAL)
37
HOU:3210582.3
CERTIFICATE FOR RESOLUTION
THE STATE OF TEXAS
COUNTIES OF BRAZORIA AND HARRIS
CITY OF PEARLAND
I, the undersigned officers of the City of Pearland, Texas (the "City"), hereby certify as
follows:
1.The City Council of the City convened in a regular meeting on April 30, 2012, at the
regular meeting place thereof, within the City, and the roll was called of the duly constituted officers and
members of the City Council, to wit:
Tom Reid Mayor
Woodrow "Woody" Owens Councilmember
Scott Sherman Councilmember
Susan Sherrouse Councilmember
Felicia Harris Councilmember
Greg Hill Councilmember
and all of such persons were present except Felicia Harris, thus constituting a quorum. Whereupon,
among other business, the following was transacted at said meeting: a written
RESOLUTION OF THE CITY OF PEARLAND, TEXAS APPROVING THE
RESOLUTION AUTHORIZING THE ISSUANCE OF THE DEVELOPMENT
AUTHORITY OF PEARLAND TAX INCREMENT CONTRACT REVENUE AND
REFUNDING BONDS SERIES 2012; APPROVING A BOND RESOLUTION,
INDENTURE OF TRUST, PRIVATE . PLACEMENT LETTER, ESCROW
AGREEMENT AND OTHER DOCUMENTS RELATING TO THE BONDS; MAKING
CERTAIN FINDINGS AND CONTAINING OTHER PROVISIONS RELATED
THERETO
(the "Resolution") was duly introduced for the consideration of the City Council and read in full. It was
then duly moved and seconded that the Resolution be adopted; and, after due discussion, such motion,
carrying with it the adoption of the Resolution, prevailed and carried by the following vote:
AYES: 4 NAYS: 0 ABSTENTIONS: 0
2.That a true, full and correct copy of the Resolution adopted at the meeting described in
the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been
duly recorded in the City Council's minutes of such meeting; that the above and foregoing paragraph is a
true, full and correct excerpt from the City Council's minutes of such meeting pertaining to the adoption
of the Resolution; that the persons named in the above and foregoing paragraph are the duly chosen,
qualified and acting officers and members of the City Council as indicated therein; that each of the
officers and members of the City Council was duly and sufficiently notified officially and personally, in
advance, of the date, hour, place and subject of the aforesaid meeting, and that the , Resolution would be
introduced and considered for adoption at such meeting, and each of such officers and members
consented, in advance, to the holding of such meeting for such purpose; that such meeting was open to the
public as required by law; and that public notice of the date, hour, place and subject of such meeting was
given as required by the Open Meetings Law, Chapter 551, Texas Government Code.
HOU:3213644.1
SIGNED AND SEALED this April 30, 2012.
Cj4fSecretf F Mayor
I Y OF ARLAND, T XAS CITY OF PEARLAND, TEXAS
HOU:3213644.1
RESOLUTION NO. 2012-55
RESOLUTION OF THE CITY OF PEARLAND, TEXAS, APPROVING THE ISSUANCE OF
$56,915,000 DEVELOPMENT AUTHORITY OF PEARLAND TAX INCREMENT
CONTRACT REVENUE AND REFUNDING BONDS, SERIES 2012; APPROVING A BOND
RESOLUTION, INDENTURE OF TRUST, A PRIVATE PLACEMENT LETTER, ESCROW
AGREEMENT AND OTHER DOCUMENTS RELATING TO THE BONDS; MAKING
CERTAIN FINDINGS AND CONTAINING OTHER PROVISIONS RELATED THERETO
STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
WHEREAS, by City Ordinance No. 891, the City of Pearland, Texas (the "City") created
Reinvestment Zone Number Two, City of Pearland, Texas (the "Zone") pursuant to Chapter 311,
Texas Tax Code (the "TIRZ Act"); and
WHEREAS, by Resolution No. 2004-107 adopted by the City Council of the City on
June 28, 2004, the City authorized the creation of the Development Authority of Pearland (the
"Authority") as a local government corporation pursuant to Subchapter D of Chapter 431, Texas
Transportation Code (the "LGC Act"), to aid, assist and act on behalf of the City in the
performance of the City's governmental and proprietary functions with respect to the common
good and general welfare of the Zone; and
WHEREAS, by City Ordinance No. R2004-170, the City authorized an agreement with
the Zone and the Authority (the "Tri-Party Agreement"), which sets forth, among other things,
the duties and responsibilities of the Authority, the City and the Zone as they relate to
reimbursements for Project Costs (as defined in the Indenture) in the Zone, and pursuant to
which the City and the Zone have agreed to pay the Authority on an annual basis certain of the
Tax Increments (as defined in the Indenture) then available in the Tax Increment Fund (as
defined in the Indenture); and
WHEREAS, the Tri-Party Agreement authorizes the Authority to issue bonds secured by
payments made to the Authority under the Tri-Party Agreement and further authorizes the
Authority to issue such bonds for the purpose of making developer reimbursements for Project
Costs only with the approval of the City; and
WHEREAS, the Authority has previously issued its $13,995,000 Tax Increment Contract
Revenue Bonds, Series 2004, (the "Series 2004 Bonds"), its $9,775,000 Tax Increment Contract
Revenue Bonds, Series 2005 (the "Series 2005 Bonds"), its $9,970,000 Tax Increment Contract
Revenue Bonds, Series 2006 (the "Series 2006 . Bonds"), its $15,950,000 Tax Increment Contract
Revenue Bonds, Series 2007 (the "Series 2007 Bonds"); and its $8,815,000 Tax Increment
Contract Revenue Bonds, Series 2009 (the "Series 2009 Bonds") (collectively, the "Refunded
HOU:3211404.3
Bonds"); and now desires to refund the Refunded Bonds in order to restructure the Authority's
debt; and
WHEREAS, the Authority desires to issue its Tax Increment Contract Revenue and
Refunding Bonds, Series 2012 in the aggregate principal amount of $56,915,000 (the "Bonds")
pursuant to a resolution authorizing the issuance of the Bonds (the "Bond Resolution") adopted
by the Authority on April 30, 2012, and the Authority desires to use the proceeds from the sale of
such Bonds for the purposes of (1) refunding the Refunded Bonds; (2) paying Project Costs
(which includes amounts owed to developers under certain development agreements and the
acquisition and the construction of certain public works and public improvements within the
Zone), and (3) paying costs of issuance of the Bonds, all under and pursuant to the authority of
the Act and all other applicable law; and
WHEREAS, in order to further secure the Bonds, the Authority has determined to enter
into an Indenture of Trust (the "Indenture") with Regions Bank (the "Trustee"), for the purpose
of assigning and pledging to the Trustee the Contract Tax Increments (as defined in the
Indenture), for the purpose of establishing the Pledged Revenue Fund, the Project Fund, the Debt
Service Fund, and the Debt Service Reserve Fund pursuant hereto and thereby providing the
Pledged Revenues (as defined in the Indenture) to be held by the Trustee to secure the payment
of principal of and interest on the Bonds and any Additional Parity Bonds from time to time
issued under the Indenture and the Bond Resolutions; and
WHEREAS none of the proceeds of the Bonds shall be used for the purpose of paying or
otherwise providing for educational facilities, and
WHEREAS the City Council desires to approve the issuance of the Authority's Tax
Increment Contract Revenue and Refunding Bonds, Series 2012; Now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND,
TEXAS THAT:
Section 1. Preamble. The facts and recitations set out in the preamble of this Resolution
are found to be true and correct and are hereby adopted and made a part hereof for all purposes.
Section 2. Approval of Bonds; Authorization of Agreements; Approval of
Reimbursements. City Council hereby approves the issuance of the Bonds by the Authority and
all reasonable agreements necessary in connection with the issuance of the Bonds, including
without limitation the following: the Indenture (attached hereto as Exhibit A), the Private
Placement Letter with Capital One, N.A. (attached hereto as Exhibit B), the Escrow Agreement
(attached hereto as Exhibit C) and any and all other documents and agreements reasonable and
necessary for the Authority to issue the Bonds (collectively, the "Agreements"). City Council
hereby reconfirms its prior approval of certain developer reimbursements and acknowledges that
a portion of the proceeds from the sale of the Bonds will be used to make such reimbursements.
Section 3. Approval of Bond Resolution. City Council hereby approves the Authority's
Bond Resolution authorizing the issuance of the Authority's $56,915,000 Development
Authority of Pearland Tax Increment Contract Revenue and Refunding Bonds, Series 2012, a
copy of which is attached hereto as Exhibit D.
2
HOU:3211404.3
Section 4. Authorization of Other Matters Relating Thereto. The Mayor, City Secretary
and other officers and agents of the City are hereby authorized and directed to do any and all
things necessary or desirable to carry out the provisions of this Resolution.
Section 5. Effective Date. This Resolution shall take effect immediately upon passage.
Section 6. Public Meeting. It is officially found, determined and declared that the
meeting at which this Resolution is adopted was open to the public and public notice of the time,
place and subject matter of the public business to be considered at such meeting, including this
Resolution, was given all as required by the Texas Government Code, Chapter 551, as amended.
HOU:3211404.3
PASSED AND APPROVED this day of April, 2012.
Mayor
City of Pearland
ATTEST:
irk //. /I^' J •
HOU:3211404.2
EXHIBIT A
Indenture of Trust
See Transcript Tab 8
A-I
HOU:3211404.3
EXHIBIT B
Private Placement Letter
See Transcript Tab 2
B-1
HOU:3211404.3
EXHIBIT C
Escrow Agreement
See Transcript Tab 3
C-1
HOU:3211404.3
EXHIBIT D
Bond Resolution
See Transcript Tab 10
D-1
HOU:3211404.3
CERTIFICATE FOR RESOLUTION
THE STATE OF TEXAS §
COUNTIES OF BRAZORIA AND HARRIS §
CITY OF PEARLAND §
I, the undersigned officer of the Board of Directors of the Development Authority of
Pearland (the "Authority"), hereby certify as follows:
1.The Board of Directors of the Authority convened in a special meeting on April 30, 2012,
at the regular meeting place of the Authority; and the roll was called of the duly constituted officers and
members of the Authority, to wit:
Tom Reid Chair
Bill Sloan Vice-Chair
Ed Baker Secretary
Tom Pool Director
Anthony D. Carbone Director
and all of such persons were present, thus constituting a quorum. Whereupon, among other business, the
following was transacted at said meeting: a written
RESOLUTION AUTHORIZING THE ISSUANCE OF THE DEVELOPMENT
AUTHORITY OF PEARLAND TAX INCREMENT CONTRACT REVENUE AND
REFUNDING BONDS SERIES 2012; APPROVING DOCUMENTS RELATING TO
THE SERIES 2012 BONDS; AUTHORIZING THE REDEMPTION PRIOR TO
MATURITY OF CERTAIN OUTSTANDING BONDS AND THE EXECUTION AND
DELIVERY OF AN ESCROW AGREEMENT AND THE PURCHASE OF CERTAIN
ESCROWED SECURITIES; AND CONTAINING OTHER PROVISIONS RELATED
THERETO
(the "Resolution") was duly introduced for the consideration of the City Council and read in full. It was
then duly moved and seconded that the Resolution be adopted; and, after due discussion, such motion,
carrying with it the adoption of the Resolution, prevailed and carried by the following vote:
AYES: 5 NAYS: 0 ABSTENTIONS: 0
2.That a true, full and correct copy of the Resolution adopted at the meeting described in
the above and foregoing paragraph is attached to and follows this certificate; that the Resolution has been
duly recorded in the City Council's minutes of such meeting; that the above and foregoing paragraph is a
true, full and correct excerpt from the City Council's minutes of such meeting pertaining to the adoption
of the Resolution; that the persons named in the above and foregoing paragraph are the duly chosen,
qualified and acting officers and members of the City Council as indicated therein; that each of the
officers and members of the City Council was duly and sufficiently notified officially and personally, in
advance, of the date, hour, place and subject of the aforesaid meeting, and that the Resolution would be
introduced and considered for adoption at such meeting, and each of such officers and members
consented, in advance, to the holding of such meeting for such purpose; that such meeting was open to the
public as required by law; and that public notice of the date, hour, place and subject of such meeting was
given as required by the Open Meetings Law, Chapter 551, Texas Government Code.
HOU:3213646.1
SIGNED this April 30, 2012.
Secretary Chair
Board of Directors Board of Directors
HOU:3213646.1
RESOLUTION AUTHORIZING THE ISSUANCE OF $56,915,000 DEVELOPMENT
AUTHORITY OF PEARLAND TAX INCREMENT CONTRACT REVENUE AND
REFUNDING BONDS, SERIES 2012; APPROVING DOCUMENTS RELATING TO
THE SERIES 2012 BONDS; AUTHORIZING THE REDEMPTION PRIOR TO
MATURITY OF CERTAIN OUTSTANDING BONDS AND THE EXECUTION AND
DELIVERY OF AN ESCROW AGREEMENT AND THE PURCHASE OF CERTAIN
ESCROWED SECURITIES; AND CONTAINING OTHER PROVISIONS RELATED
THERETO
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE DEVELOPMENT
AUTHORITY OF PEARLAND:
ARTICLE I
RECITALS
WHEREAS, by Ordinance No. 891, adopted on December 21, 1998, the City of
Pearland (the "City") created Reinvestment Zone Number Two, City of Pearland, Texas
(the "TIRZ") pursuant to Chapter 311, Texas Tax Code, and by Ordinance No. 1276,
adopted on July 10, 2006, the City approved an annexation of land into the TIRZ; and
WHEREAS, by Ordinance No. 918, adopted on August 23, 1999, the City
approved a preliminary project plan for the TIRZ and a preliminary reinvestment zone
financing plan for the TIRZ, which it amended by Ordinance No. 1276, adopted on July
10, 2006, by Ordinance No. 1312 adopted on November 13, 2006, and by Ordinance No.
1314, adopted on November 13, 2006; and
WHEREAS, by Resolution No. 2004-107, adopted on June 28, 2004, the City
authorized the creation of the Development Authority of Pearland (the "Authority") to
aid, assist and act on behalf of the City in the performance of the City's governmental
and proprietary functions with respect to, and to provide financing for the TIRZ; and
WHEREAS, by Ordinance No. R2004-17, adopted on October 11, 2004, the City
approved and on October 5, 2004, the Boards of Directors of the TIRZ and the Authority
approved that certain Agreement by and between the City, the TIRZ, and the Authority,
as amended by Amendment No. 1 to the Tri-Party Agreement, dated September 17,
2007 (collectively, the "Tr-Party Agreement"), pursuant to which the City delegated to
the Authority the power and authority to issue, sell or deliver its bonds, notes or other
obligations in accordance with the terms of the Tri-Party Agreement; and
WHEREAS, the Authority has issued its $13,995,000 Tax Increment Contract
Revenue Bonds, Series 2004, (the "Series 2004 Bonds"), its $9,775,000 Tax Increment
Contract Revenue Bonds, Series 2005 (the "Series 2005 Bonds"), its $9,970,000 Tax
1
HOU:3209953.10
Increment Contract Revenue Bonds, Series 2006 (the "Series 2006 Bonds"), its
$15,950,000 Tax Increment Contract Revenue Bonds, Series 2007 (the "Series 2007
Bonds"); and its $8,815,000 Tax Increment Contract Revenue Bonds, Series 2009 (the
"Series 2009 Bonds") (collectively, the "Refunded Bonds");
WHEREAS, the Authority now desires to issue bonds to refund the Refunded
Bonds and to pay Project Costs;
WHEREAS, the Authority wishes to refund the Refunded Bonds in order to
restructure the Authority's debt and that such refunding is in the best interests of the
Authority.
WHEREAS, the Authority is authorized to issue refunding bonds for the purpose
of refunding the Refunded Bonds in advance of their maturities, and to accomplish such
refunding by depositing directly with a paying agent for the Refunded Bonds the
proceeds of such refunding bonds, together with other available funds, in an amount
adequate to provide for the payment or redemption of the Refunded Bonds, and that
such deposit shall constitute the making of firm banking and financial arrangements for
the discharge and final payment or redemption of the Refunded Bonds; and
WHEREAS, the Authority desires to enter into an escrow agreement (the
"Escrow Agreement") with Regions Bank (the "Escrow Agent"), pursuant to which
proceeds of the refunding bonds herein authorized, together with other available funds,
will be deposited, and applied in a manner adequate to provide for the full and timely
payment of all interest on and principal of the Refunded Bonds; and
WHEREAS, upon the issuance of the refunding bonds herein authorized, the
Refunded Bonds shall no longer be regarded as being outstanding, and the pledges,
liens, trusts and all other covenants, provisions, terms and conditions of the resolutions
authorizing the issuance of the Refunded Bonds shall be, with respect to the Refunded
Bonds, discharged, terminated and defeased;
WHEREAS by Resolution No. R2012-55 adopted on April 30, 2012, the City
authorized the Authority to issue, sell, or deliver its Tax Increment Contract Revenue
and Refunding Bonds, Series 2012; and
WHEREAS, as permitted by the Act, the Authority desires to issue its Tax
Increment Contract Revenue and Refunding Bonds, Series 2012 upon the terms and
conditions and for the purposes herein provided.
2
HOU:3209953. 10
ARTICLE II
DEFINITIONS AND INTERPRETATIONS
Section 2.1: Definitions. In this Resolution, the following terms shall have
the following meanings, unless the context clearly indicates otherwise. Terms not
defined herein shall have the meanings assigned to such terms in the Indenture:
The term "Adjustment Date" shall have the meaning defined in the definition of
"Applicable Rate."
The term "Applicable Rate" shall mean the lesser of (a) the Maximum Rate or
(b) 65% of LIBOR Rate plus two hundred basis points (2.0%) per annum, with said rate
to . be adjusted every three months, every six months, every nine months or every twelve
months at the election of the Authority (each, an "Adjustment Date") to reflect any
change in said rate at the time of any such adjustment.
The term "Business Day" shall mean any day which is not a Saturday, Sunday, or
a day on which banking institutions in the city where the designated payment office of
the Paying Agent/Registrar is located are authorized by law or executive order to close,
or a legal holiday.
The "Code" means the Internal Revenue Code of 1986, as amended.
The term "Comptroller" shall mean the Comptroller of Public Accounts of the
State of Texas.
The term "Escrow Agent" shall mean Regions Bank, or any successor thereto.
The term "Escrow Agreement" shall mean that certain Escrow Agreement, dated
as of May 1, 2012, by and between the Escrow Agent and the Authority.
The term "Escrow Fund" shall mean the fund created in Section 3.1 of the Escrow
Agreement to be administered by the Escrow Agent pursuant to the provisions of the
Escrow Agreement.
The term "Fixed Rate" shall mean 3.07% per annum.
The term "Fixed Rate Period" shall mean May 22, 2012 through and including
May 21, 2022.
The term "Highest Lawful Rate" shall mean with respect to the Series 2012 Bonds
the maximum net effective interest rate permitted by law to be paid thereon as
provided by Chapter 1204, Texas Government Code, as amended, or any successor
thereto.
HOU:3209953.10
The term "Indenture" shall mean the Indenture of Trust dated as of May 1, 2012,
between the Authority and Regions Bank, as Trustee.
The term "Initial Series 2012 Bond" shall mean the Initial Series 2012 Bond
authorized by Section 3.4(d).
The term "Interest Payment Date" shall mean, with respect to the Series 2012
Bonds, September 1, 2012, and each March 1 and September 1 thereafter until maturity
or redemption, or such other Interest Payment Date that is set forth in the Resolution.
The term "Issuance Date" shall mean the date on which each such Series 2012
Bond is authenticated by the Paying Agent/Registrar and delivered to and paid for by
the Purchaser.
The term "LIBOR Rate" shall mean the London Interbank Offered Rate for three
(3) months, six (6) months, nine (9) months or twelve (12) months as published in The
Wall Street Journal under "Latest" in the "Money Rates" column on the banking day
immediately preceding the Adjustment Date (or, if such source is not available, such
alternate source as reasonably determined by the Purchaser and approved by the
Authority). If the Adjustment Date in any particular month would otherwise fall on a
day that is not a banking day then, at Purchaser's option, the Adjustment Date for that
particular month will be the first banking day immediately following thereafter.
"Banking day" shall mean any day other than Saturday or Sunday or other day that
commercial banks in the State of Texas or London, England are authorized to close or
are in fact closed.
The term "Maximum Rate" shall mean with respect to the Series 2012 Bonds, the
lesser of 6% per annum or the Highest Lawful Rate.
The term "Purchaser" shall mean the Capital One Public Funding, L.L.C. as
initial purchaser of the Series 2012 Bonds.
The term "Paying Agent/Registrar" shall mean Regions Bank, and its successors
in that capacity.
The term "Record Date" shall mean, for any Interest Payment Date, the fifteenth
(15th) calendar day of the month next preceding each Interest Payment Date.
The term "Resolution" or "Bond Resolution" shall mean this Resolution
Authorizing the Issuance of $56,915,000 Development Authority of Pearland Tax
Increment Contract Revenue and Refunding Bonds, Series 2012, and all amendments
hereof and supplements hereto.
n
HOU:3209953.10
The term "Series 2012 Bond" or "Series .2012 Bonds" shall mean the Authority's
Tax Increment Contract Revenue and Refunding Bonds, Series 2012 authorized by this
Resolution.
The term "Variable Rate Period" shall mean the period from and including any
Adjustment Date to and including the day immediately preceding the next following
Adjustment Date and beginning May 22, 2022. Each Variable Rate Period shall be three
(3), six (6), nine (9) or twelve (12) months as selected by the Authority on each
Adjustment Date.
Section 2.2: Interpretations. All terms defined herein and all pronouns used
in this Resolution shall be deemed to apply equally to singular and plural and to all
genders. The 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.
This Resolution and all the terms and provisions hereof shall be liberally construed to
effectuate the purposes set forth herein and to sustain the validity of the Parity Bonds
and the validity of the lien on and pledge of the Pledged Revenues to secure the
payment of the Parity Bonds.
ARTICLE III
TERMS OF THE SERIES 2012 BONDS
Section 3.1: Amount, Purpose, Authorization. The Series 2012 Bonds shall
be issued in the aggregate principal amount of $56,915,000 for the purpose of (1) paying
Project Costs, (2) refunding the Refunded Bonds, and (3) paying costs of issuance, all
under and pursuant to the authority of the Act and all other applicable law. None of
the proceeds of the Series 2012 Bonds shall be used for the purpose of paying or
otherwise providing for educational facilities.
It is hereby found and determined that such refunding will benefit the Authority
by restructuring a portion of its outstanding bonds and by providing a gross savings of
$2,614,780.68, and a net present value savings of $1,765,014.53, in the debt service
payable by the Authority, that such benefit is sufficient consideration for the refunding
of the Refunded Bonds, and that the refunding of the Refunded Bonds is in the best
interest of the Authority.
Section 3.2: Name, Designation, Date, and Interest Payment Dates. The
Series 2012 Bonds shall be designated as the "DEVELOPMENT AUTHORITY OF
PEARLAND TAX INCREMENT CONTRACT REVENUE AND REFUNDING BONDS,
SERIES 2012," shall be issued in fully registered form, without coupons and shall be
dated May 1, 2012 (the "Dated Date"). The Series 2012 Bonds shall bear interest at the
19
HOU:3209953.10
rates set forth in Section 3.3 from the later of the date of delivery, or the most recent
Interest Payment Date to which interest has been paid or duly provided for, calculated
on the basis of a 360-day year of . twelve 30-day months, payable, semiannually on
March 1 and September 1, commencing September 1, 2012, until maturity or earlier
redemption.
Section 3.3: Principal Amounts and Interest Rates; Numbers and
Denomination. The Series 2012 Bonds shall be initially issued in the principal amounts
and bearing interest at the rates set forth below, and may be transferred and exchanged
as set out in this Resolution. The Series 2012 Bonds shall mature, subject to prior
redemption in accordance with this Resolution, on September 1 , 2029. The Series 2012
Bonds shall accrue interest from the date of delivery until, but not including, May 22,
2022, at the Fixed Rate. Beginning May 22, 2022, the interest rate shall reset on each
Adjustment Date to the Applicable Rate for the corresponding Variable Rate Period
with the first such Adjustment Date being May 22, 2022, until the date of final maturity
or prepayment prior to maturity. The Initial Bond shall be numbered I-1 and the
definitive Series 2012 Bonds shall be numbered with R-1. Series 2012 Bonds delivered
on transfer of or in exchange for other Series 2012 Bonds shall be numbered in the order
of their authentication by the Paying Agent/Registrar, shall be in the denomination of
$100,000 or $5,000 increments thereof, and shall mature on the same date and bear
interest at the same rate as the Series 2012 Bond or Series 2012 Bonds in lieu of which
they are delivered. The Bonds will be subject to mandatory sinking fund redemption in
installments according to the following schedule:
Principal Maturity Date Interest
Amount September 1 Rate
$2,680,000 2012 3.07
2,720,000 2013 3.07
2,800,000 2014 3.07
2,885,000 2015 3.07
2,970,000 2016 3.07
3,070,000 2017 3.07
3,160,000 2018 3.07
3,255,000 2019 3.07
3,120,000 2020 3.07
3,215,000 2021 3.07
3,030,000 2022 3.07
3,130,000 2023 3.07
3,225,000 2024 3.07
3,320,000 2025 3.07
3,425,000 2026 3.07
3,530,000 2027 3.07
3,635,000 2028 3.07
6
HOU:3209953.10
3,745,000 2029 3.07
Section 3.4: Execution and Registration of Series 2012 Bonds. (a) The Series
2012 Bonds shall be signed by the Chair or Vice Chair or Director of the Board and
countersigned by the Secretary or Director of the Board, by their manual, lithographed,
or facsimile signatures. Such facsimile signatures on the Series 2012 Bonds shall have
the same effect as if each of the Series 2012 Bonds had been signed manually and in
person by each of said Directors or officers.
(b)If any Director or officer of the Authority whose manual or facsimile
signature shall appear on the Series 2012 Bonds shall cease to be such Director or officer
before the authentication of such Series 2012 Bonds or before the delivery of such Series
2012 Bonds, such manual or facsimile signature shall nevertheless be valid and
sufficient for all purposes as if such Director or officer had remained in such office.
(c)Except as provided below, no Series 2012 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 Paying Agent/Registrar's Authentication Certificate
substantially in the form provided herein, duly authenticated by manual execution by
an officer or duly authorized signatory of the Paying Agent/Registrar. In lieu of the
executed Paying Agent/Registrar's Authentication Certificate described above, the
Initial Series 2012 Bond delivered at the Issuance Date shall have attached thereto the
Comptroller's Registration Certificate substantially _ in the form provided herein,
manually executed by the Comptroller, or by his duly authorized agent, which
certificate shall be evidence that the Initial Series 2012 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 Authority, and has been registered by the Comptroller.
(d)On the Issuance Date, the Initial Series 2012 Bond, being a single bond
representing the entire principal amount of the Series 2012 Bonds, payable in stated
installments to the Purchaser or their designee, executed by manual or facsimile
signature of the Chair or Vice Chair and Secretary or Director of the Board, approved by
the Attorney General, and registered and manually signed by the Comptroller of Public
Accounts, shall be delivered to the Purchaser or their designee. Upon payment for the
Initial Series 2012 Bond, the Paying Agent/Registrar shall cancel the Initial Series 2012
Bond and deliver the definitive Series 2012 Bonds to the Purchaser in accordance with
Section 3.12.
Section 3.5: Payment of Principal and Interest. The Paying Agent/Registrar
is hereby appointed as the registrar and paying agent for the Series 2012 Bonds. The
principal of the Series 2012 Bonds shall be payable, without exchange or collection
charges, in any coin or currency of the United States of America which, on the date of
payment, is legal tender for the payment of debts due the United States of America,
upon their presentation and surrender as they respectively become due and payable,
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whether at maturity or by prior redemption, at the designated office of the Paying
Agent/Registrar. The interest on each Series 2012 Bond shall be payable by check on
the Interest Payment Date, mailed by the Paying Agent/Registrar on or before each
Interest Payment Date to the Owner of record as of the Record Date, to the address of
such Owner as shown on the Register, or by such other method, acceptable to the
Paying Agent/Registrar, requested by and at the risk and expense of the Owner.
If the date for the payment of principal or interest on any Series 2012 Bond is not
a Business Day, then the date for such payment shall be the next succeeding Business
Day, and payment on such date shall have the same force and effect as if made on the
original date such payment was due.
Section 3.6: Successor Paying A ent/Re isg trars. The Authority covenants
that at all times while any Series 2012 Bonds are Outstanding it will provide a
commercial bank, or trust company or other entity duly . qualified and legally
authorized to act as Paying Agent/Registrar for the Series 2012 Bonds. The Authority
reserves the right to change the Paying Agent/Registrar for the Series 2012 Bonds on
not less than sixty (60) days written notice to the Paying Agent/Registrar, so long as
any such notice is effective not less than sixty (60) days prior to the next succeeding
principal or interest payment date on the Series 2012 Bonds. Promptly upon the
appointment of any successor Paying Agent/Registrar, the previous Paying
Agent/Registrar shall deliver the Register or a copy thereof to the new Paying
Agent/Registrar, and the new Paying Agent/Registrar shall notify each Owner, by
United States mail, first class postage prepaid, of such change and of the address of the
new Paying Agent/Registrar. Each Paying Agent/Registrar hereunder, by acting in
that capacity, shall be deemed to have agreed to the provisions of this Section.
Section 3.7: Special Record Date. If interest on any Series 2012 Bond is not
paid on any Interest Payment Date and continues unpaid for thirty (30) days thereafter,
the Paying Agent/Registrar shall establish a new record date for the payment of such
interest, to be known as a "Special Record Date." The Paying Agent/Registrar shall
establish a Special Record Date when funds to make such interest payment are received
from or on behalf of the Authority. Such Special Record Date shall be fifteen (15) days
prior to the date fixed for payment of such past due interest, and notice of the date of
payment and the Special Record Date shall be sent by United States mail, first class,
postage prepaid, not later than five (5) days prior to the Special Record Date, to each
Owner of record of an affected Series 2012 Bond as of the close of business on the day
prior to the mailing of such notice.
Section 3.8: Ownership; Unclaimed Principal and Interest. Subject to the
further provisions of this Section, the Authority, the Paying Agent/Registrar and any
other person may treat the person in whose name any Series 2012 Bond is registered as
the absolute Owner of such Series 2012 Bond for the purpose of making and receiving
payment of the principal of or interest on such Series 2012 Bond, and for all other
HOU:3209953.10
purposes, whether or not such Series 2012 Bond is overdue, and neither the Authority
nor the Paying Agent/Registrar shall be bound by any notice or knowledge to the
contrary. All payments made to the person deemed to be the Owner of any Series 2012
Bond in accordance with this Section 3.8 shall be valid and effectual and shall discharge
the liability of the Authority and the Paying Agent/Registrar upon such Series 2012
Bond to the extent of the sums paid.
Amounts held by the Paying Agent/Registrar which represent principal of and
interest on the Series 2012 Bonds remaining unclaimed by the Owner after the
expiration of three (3) years from the date such amounts have become due and payable
shall be remitted to the Authority, except to the extent that they are required by law to
be reported and disposed of by the Paying Agent/Registrar in accordance with the
applicable provisions of Texas law including, to the extent applicable, Title 6 of the
Texas Property Code, as amended.
Section 3.9: Registration of Bonds. (a) The Series 2012 Bonds shall be
registered in the name of Capital One Public Funding, LLC
(b) Notwithstanding any other provision of this Resolution to the contrary,
the Authority and the Paying Agent/Registrar shall be entitled to treat and consider the
person in whose name each Series 2012 Bond is registered in the Register as the absolute
Owner of such Series 2012 Bond for the purpose of payment of principal of and interest
on the Series 2012 Bonds, for the purpose of giving notices of redemption and other
matters with respect to such Series 2012 Bond, for the purpose of registering transfer
with respect to such Series 2012 Bond, and for all other purposes whatsoever. The
Paying Agent/Registrar shall pay all principal of, premium, if any, and interest on the
Series 2012 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 Authority's obligations with respect to payments of principal, premium, if any, and
interest on the Series 2012 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 Series 2012 Bond
certificate evidencing the obligation of the Authority to make payments of amounts due
pursuant to this Resolution.
Section 3.10: Reserved.
Section 3.11: Reserved.
Section 3.12: Registration, Transfer, and Exchange. So . long as any Series
2012 Bonds remain Outstanding, the Paying Agent/Registrar shall keep the Register at
its designated office and, subject to such reasonable regulations as it may prescribe, the
Paying Agent/Registrar shall provide for the registration and transfer of Series 2012
Bonds in accordance with the terms of this Resolution.
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Each Series 2012 Bond shall be transferable only upon the presentation and
surrender thereof at the designated office of the Paying Agent/Registrar, duly endorsed
for transfer, or accompanied by an assignment duly executed by the Registered Owner
or his authorized representative in form satisfactory to the Paying Agent/Registrar.
Upon due presentation of any Series 2012 Bond in proper form for transfer, the Paying
Agent/Registrar shall authenticate and deliver in exchange therefor, a new Series 2012
Bond or Series 2012 Bonds, registered in the name of the transferee or transferees, in
authorized denominations and of the same maturity, aggregate principal amount, and
Dated Date, and bearing interest at the same rate as the Series 2012 Bond or Series 2012
Bonds so presented.
All Series 2012 Bonds shall be exchangeable upon presentation and surrender
thereof at the designated office of the Paying Agent/Registrar for a Series 2012 Bond or
Series 2012 Bonds of the same maturity, Dated Date, and interest rate and in any
authorized denomination, in an aggregate amount equal to the unpaid principal
amount of the Series 2012 Bond or Series 2012 Bonds presented for exchange. The
Paying Agent/Registrar shall be and is hereby authorized to authenticate, deliver and
exchange Series 2012 Bonds in accordance with the provisions of this Section 3.12. Each
Series 2012 Bond delivered in accordance with this Section 3.12 shall be entitled to the
benefits and security of this Resolution to the same extent as the Series 2012 Bond or
Series 2012 Bonds in lieu of which such Series 2012 Bond is delivered.
The Authority or the Paying Agent/Registrar may require the Owner of any
Series 2012 Bond to pay a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with the transfer or exchange of such Series 2012
Bond. Any fee or charge of the Paying Agent/Registrar for such transfer or exchange
shall be paid by the Authority.
The Paying Agent/Registrar shall not be required to transfer or exchange any
Series 2012 Bond during the period beginning on a Record Date or a Special Record
Date and ending on the next succeeding Interest Payment Date or to • transfer or
exchange any Series 2012 Bond called for redemption during the period beginning
thirty days prior to the date fixed for redemption and ending on the date fixed for
redemption; provided, however, that this limitation shall not apply to the exchange by
the Owner of the unredeemed portion of a Series 2012 Bond called for redemption in
part.
Section 3.13: Cancellation of Series 2012 Bonds. All Series 2012 Bonds paid or
redeemed in accordance with this Resolution, and all Series 2012 Bonds in lieu of which
exchange Series 2012 Bonds or replacement Series 2012 Bonds are authenticated and
delivered in accordance herewith, shall be cancelled upon the making of proper records
regarding such payment or redemption and retained in accordance with the Paying
Agent/Registrar's document retention policy. Upon request of the Authority therefore,
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the Paying Agent/Registrar shall furnish the Authority with appropriate certificates of
cancellation of such Series 2012 Bonds.
Section 3.14: Mutilated, Lost, or Stolen Series 2012 Bonds. Upon the
presentation and surrender to the Paying Agent/Registrar of a mutilated Series 2012
Bond, the Paying Agent/Registrar shall authenticate and deliver in exchange therefor a
replacement Series 2012 Bond of like maturity, Dated Date, interest rate and principal
amount, bearing a number not contemporaneously Outstanding. The Authority or the
Paying Agent/Registrar may require the Owner of such Series 2012 Bond to pay a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith and any other expenses connected therewith, including the fees
and expenses of the Paying Agent/Registrar.
If any Series 2012 Bond is lost, apparently destroyed, or wrongfully taken, the
Authority, pursuant to the applicable laws of the State of Texas and in the absence of
notice or knowledge that such Series 2012 Bond has been acquired by a bona fide
purchaser, shall execute and the Paying Agent/Registrar shall authenticate and deliver
a replacement Series 2012 Bond of like maturity, Dated Date, interest rate and principal
amount, bearing a number not contemporaneously Outstanding, provided that the
Owner thereof shall have:
(1)furnished to the Authority and the Paying Agent/Registrar satisfactory
evidence of the ownership of and the circumstances of the loss,
destruction or theft of such Series 2012 Bond;
(2)furnished such security or indemnity as may he required by the Paying
Agent/Registrar and the Authority to save them harmless;
(3)paid 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 may be imposed; and
(4)met any other reasonable requirements of the Authority and the Paying
Agent/Registrar.
If, after the delivery of such replacement Series 2012 Bond, a bona fide purchaser of the
original Series 2012 Bond in lieu of which such replacement Series 2012 Bond was
issued presents for payment such original Series 2012 Bond, the Authority and the
Paying Agent/Registrar shall be entitled to recover such replacement Series 2012 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
Authority or the Paying Agent/Registrar in connection therewith.
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If any such mutilated, lost, apparently destroyed or wrongfully taken Series 2012
Bond has become or is about to become due and payable, the Authority in its discretion
may, instead of issuing a replacement Series 2012 Bond, authorize the Paying
Agent/Registrar to pay such Series 2012 Bond.
Each replacement Series 2012 Bond delivered in accordance with this Section 3.14
shall be entitled to the benefits and security of this Resolution to the same extent as the
Series 2012 Bond or Series 2012 Bonds in lieu of which such replacement Series 2012
Bond is delivered.
Section 3.15: Redemption. The Series 2012 Bonds are subject to optional and
mandatory sinking fund redemption on the dates and for the redemption prices set
forth in the form of the Series 2012 Bond in this Resolution.
Principal amounts may be redeemed only in integrals of $100,000. If a Series
2012 Bond subject to redemption is in a denomination larger than $100,000, a portion of
such Series 2012 Bond may be redeemed, but only in integral multiples of $5,000. In
selecting portions of Series 2012 Bonds for redemption, the Paying Agent/ Registrar
shall treat each Series 2012 Bond as representing that number of Series 2012 Bonds of
$100,000 denomination or any integral multiple of $5,000 in excess thereof. The Paying
Agent/Registrar shall select the particular Series 2012 Bonds to be redeemed within any
given maturity by lot or other random selection method. Upon surrender of any Series
2012 Bond for redemption in part, the Paying Agent/Registrar, in accordance with this
Resolution, shall authenticate and deliver in exchange therefor a Series 2012 Bond or
Series 2012 Bonds of like maturity and interest rate in an aggregate principal amount
equal to the unredeemed portion of the Series 2012 Bond so surrendered.
Unless waived by the Owner, notice of any redemption identifying the Series
2012 Bonds to be redeemed shall be given as provided in the form of Series 2012 Bond
in this Resolution. Any notice given as provided in this Section 3.15 shall be
conclusively presumed to have been duly given, whether or not the Owner receives
such notice. By the date fixed for redemption, due provision shall be made with the
Paying Agent/Registrar for payment of the redemption price of the Series 2012 Bonds
or portions thereof to be redeemed, plus accrued interest to the date . fixed for
redemption. When Series 2012 Bonds have been called for redemption in whole or in
part and due provision has been made to redeem the same as herein provided, the
Series 2012 Bonds or portions thereof so redeemed shall no longer be regarded as
Outstanding except for the purpose of receiving payment solely from the funds so
provided for redemption, and the rights of the Owners to collect interest which would
otherwise accrue after the redemption date on any Series 2012 Bond or portion thereof
called for redemption shall terminate on the date fixed for redemption.
Section 3.16: Limited Obligations. THE SERIES 2012 BONDS AND ALL
PARITY BONDS ARE LIMITED OBLIGATIONS OF THE AUTHORITY, PAYABLE
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SOLELY OUT OF THE PLEDGED REVENUES, WHICH IS THE SOLE ASSET OF THE
AUTHORITY PLEDGED THEREFOR. THE SERIES 2012 BONDS ARE OBLIGATIONS
SOLELY OF THE AUTHORITY AND DO NOT CONSTITUTE, WITHIN THE
MEANING OF ANY STATUTORY OR CONSTITUTIONAL PROVISION, AN
INDEBTEDNESS, AN OBLIGATION OR A LOAN OF CREDIT OF THE CITY OF
PEARLAND, THE STATE OF TEXAS, ALVIN INDEPENDENT SCHOOL DISTRICT,
BRAZORIA COUNTY, FORT BEND COUNTY OR ANY OTHER MUNICIPALITY,
COUNTY, OR OTHER MUNICIPAL OR POLITICAL CORPORATION OR
SUBDIVISION OF THE STATE OF TEXAS. NEITHER THE CITY OF PEARLAND,
ALVIN INDEPENDENT SCHOOL DISTRICT, BRAZORIA COUNTY NOR FORT
BEND COUNTY IS OBLIGATED TO MAKE PAYMENTS ON THE SERIES 2012
BONDS.
ARTICLE IV
FORM OF SERIES 2012 BONDS AND CERTIFICATES
Section 4.1: Forms. The form of the Series 2012 Bonds, including the form of
the Paying Agent/Registrar's authentication certificate, the form of assignment, and the
form of the Comptroller's Registration Certificate for the Series 2012 Bonds to be
initially issued, shall be substantially as follows, with such additions, deletions and
variations, as may be necessary or desirable and not prohibited by this Resolution:
(a) Form of Bond
United States of America
State of Texas
Number Registered
DEVELOPMENT AUTHORITY OF PEARLAND
TAX INCREMENT CONTRACT REVENUE AND REFUNDING BOND
SERIES 2012
INTEREST RATE: MATURITY DATE: DATED DATE: May 1, 2012
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
The DEVELOPMENT AUTHORITY OF PEARLAND (the "Authority"), a not-
for-profit local government corporation created by the City of Pearland (the "City"), in
the Counties of Brazoria and Fort Bend, in the State of Texas, for value received,
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promises to pay, but solely from certain Pledged Revenues as hereinafter provided, to
the Registered Owner identified above or registered assigns, on the Maturity Date
specified above, upon presentation and surrender of this Series 2012 Bond at the
designated office of the Paying Agent/Registrar (the "Paying Agent/Registrar"),
initially, Regions Bank, the principal amount identified above, such principal is legal
tender for the payment of debts due the United States of America, and to pay, solely
from such Pledged Revenues, interest thereon to be paid as described herein, calculated
on the basis of a 360-day year of twelve 30-day months, from the later of the date of
delivery to the Purchaser, or the most recent interest payment date to which interest has
been paid or duly provided for. Interest on this Series 2012 Bond is payable by check on
March 1 and September 1, beginning on September 1, 2012, mailed to the Registered
Owner as shown on the books of registration kept by the Paying Agent/Registrar as of
the fifteenth (15th) calendar day of the month next preceding each interest payment
date, or by such other method, acceptable to the Paying Agent/Registrar, requested by
and at the risk and expense of the Registered Owner.
THIS SERIES 2012 BOND shall be subject to mandatory sinking fund redemption
in installments according the following schedule (insert schedule from Section 3.3):
THE SERIES 2012 BONDS AND ALL PARITY BONDS ARE LIMITED
OBLIGATIONS OF THE AUTHORITY, PAYABLE SOLELY OUT OF THE PLEDGED
REVENUES, WHICH IS THE SOLE ASSET OF THE AUTHORITY PLEDGED
THEREFOR. THE SERIES 2012 BONDS ARE OBLIGATIONS SOLELY OF THE
AUTHORITY AND DO NOT CONSTITUTE, WITHIN THE MEANING OF ANY
STATUTORY OR CONSTITUTIONAL PROVISION, AN INDEBTEDNESS, AN
OBLIGATION OR A LOAN OF CREDIT OF THE CITY OF PEARLAND, THE STATE
OF TEXAS, ALVIN INDEPENDENT SCHOOL DISTRICT, BRAZORIA COUNTY,
FORT BEND COUNTY OR ANY OTHER MUNICIPALITY, COUNTY, OR OTHER
MUNICIPAL OR POLITICAL CORPORATION OR SUBDIVISION OF THE STATE OF
TEXAS. NEITHER THE CITY OF PEARLAND, ALVIN INDEPENDENT SCHOOL
DISTRICT, BRAZORIA COUNTY NOR FORT BEND COUNTY IS OBLIGATED TO
MAKE PAYMENTS ON THE SERIES 2012 BONDS.
THIS SERIES 2012 BOND IS ONE OF A DULY AUTHORIZED SERIES OF
SERIES 2012 BONDS aggregating $56,915,000 issued for the purpose of (1) paying
Project Costs, (2) refunding the Refunded Bonds, and (3) paying costs of issuance, all
under and pursuant to the authority of the Act and all other applicable laws, and a
resolution adopted by the Authority on April 30, 2012 (the "Resolution"). None of the
proceeds of the Series 2012 Bonds shall be used for the purpose of paying or otherwise
providing for educational facilities. Terms not otherwise defined herein shall have the
meaning ascribed thereto in the Resolution
THIS BOND shall accrue interest from the date of delivery until, but not
including, May 22, 2022, at a rate of 3.07% per annum. Beginning May 22, 2022, the
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interest rate shall reset on each Adjustment Date to the Applicable Rate for the
corresponding Variable Rate Period with the first such Adjustment Date being May 22,
2022, until the date of final maturity or prepayment prior to maturity.
THIS SERIES 2012 BOND AND THE SERIES OF WHICH IT IS A PART are
limited obligations of the Authority that are together with all other Parity Bonds
heretofore or hereafter issued under the Indenture described below, payable from, and
are equally and ratably secured by a lien on the Pledged Revenues, which include the
Contract Tax Increments, moneys on deposit in the Pledged Revenue Fund, the Debt
Service Fund, and interest earned on moneys deposited therein, as defined and more
fully provided in the Indenture of Trust dated as of May 1, 2012, between the Authority
and Regions Bank, as Trustee (the "Indenture"). This Series 2012 Bond and the series of
which it is a part and all other . Parity Bonds, together with the interest thereon, are
payable solely from such Pledged Revenues.
THE AUTHORITY RESERVES THE RIGHT during the Fixed Rate Period, at its
option, to redeem in whole or in part the Series 2012 Bonds on any date, at par plus
accrued interest on the amounts called for redemption to the date fixed for redemption.
THE AUTHORITY RESERVES THE RIGHT during any Variable Rate Period, at'
its option, to redeem in whole or in part the Series 2012 Bonds on the final day of any
Variable Rate Period, at par plus accrued interest on the amounts called for redemption
to the date fixed for redemption. Also, during any Variable Rate Period, the Authority
reserves the right, at its option, to redeem in whole or in part the Series 2012 Bonds on
any date other than the final date of any Variable Rate Period, at par plus accrued
interest on the amounts called for redemption to the date fixed for redemption, plus
payment of the cost, if any, as reasonably determined by the Purchaser, resulting from
the breakage of any LIBOR contract of the Purchaser associated with the Series 2012
Bonds for such Variable Rate Period.
UNLESS WAIVED BY THE OWNER, NOTICE OF ANY REDEMPTION shall be
given at least thirty (30) days prior to the date fixed for redemption by first class mail,
addressed to the Registered Owners of each Series 2012 Bond to be redeemed in whole
or in part at the address shown on the books of registration kept by the Paying
Agent/Registrar. Such notices shall state the redemption date, the redemption price,
the place at which Series 2012 Bonds are to be surrendered for payment and, if less than
all Series 2012 Bonds Outstanding of a particular maturity are to be redeemed, the
numbers of the Series 2012 Bonds or portions thereof of such maturity to be redeemed.
When Series 2012 Bonds or portions thereof have been called for redemption, and due
provision has been made to redeem the same, the principal amounts so redeemed shall
be payable solely from the funds provided for redemption, and interest which would
otherwise accrue on the amounts called for redemption shall terminate on the date fixed
for redemption.
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THIS SERIES 2012 BOND IS TRANSFERABLE only upon presentation and
surrender at the designated office of the Paying Agent/Registrar, duly endorsed for
transfer or accompanied by an assignment duly executed by the Registered Owner or
his authorized representative, subject to the terms and conditions of the Resolution.
THIS SERIES 2012 BOND IS EXCHANGEABLE at the designated office of the
Paying Agent/Registrar for Series 2012 Bonds in the principal amount of $5,000 or any
integral multiple thereof, subject to the terms and conditions of the Resolution.
NEITHER THE AUTHORITY NOR THE PAYING AGENT/REGISTRAR shall be
required to transfer or exchange any Series 2012 Bond during the period beginning on
the fifteenth calendar day of the month next preceding any interest payment date and
ending on such interest payment date or to transfer any Series 2012 Bond called for
redemption during the 30 day period prior to the redemption date.
THIS SERIES 2012 BOND shall not be valid or obligatory for any purpose or be
entitled to any benefit under the Resolution unless this Series 2012 Bond is either (i)
registered by the Comptroller of Public Accounts of the State of Texas by registration
certificate attached or affixed hereto or (ii) authenticated by the Paying Agent/Registrar
by due execution of the authentication certificate endorsed hereon.
THE AUTHORITY HAS RESERVED THE RIGHT to issue Additional Parity
Bonds, subject to the restrictions contained in the Resolution and the Indenture, which
may be equally and ratably payable from, and secured by a lien on and pledge of, the
Pledged Revenues in the same manner and to the same extent as the Parity Bonds and
this Series 2012 Bond and the series of which it is a part.
IT IS HEREBY DECLARED AND REPRESENTED that this Series 2012 Bond has
been duly and validly issued and delivered; that all acts, conditions, and things
required or proper to be performed, exist, and be done precedent to or in the issuance
and delivery of this Series 2012 Bond have been performed, existed, and been done in
accordance with law; that the Series 2012 Bonds do not exceed any statutory limitation;
and that provision has been made for the payment of the principal of and interest on
this Series 2012 Bond and all of the Parity Bonds by the creation of the aforesaid lien on
and pledge of the Pledged Revenues as provided in the Indenture.
IN WITNESS WHEREOF, the Authority has caused this Series 2012 Bond to be
executed by the manual or facsimile signatures of the Chair and Director.
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DEVELOPMENT AUTHORITY OF
PEARLAND
Chair, Board of Directors
Director, Board of Directors
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(b) Form of Registration Certificate of Comptroller of Public Accounts.
COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. -
I hereby certify that this Series 2012 Bond has been examined, certified as to
validity, and approved by the Attorney General of the State of Texas, and that this
Series 2012 Bond has been registered by the Comptroller of Public Accounts of the State
of Texas.
WITNESS MY SIGNATURE AND SEAL this
Comptroller of Public Accounts
of the State of Texas
(SEAL)
(c) Form of Paying Agent/Registrar's Authentication Certificate
AUTHENTICATION CERTIFICATE
It is hereby certified that this Series 2012 Bond
has been delivered pursuant to the Bond
Resolution described in the text of this
Series 2012 Bond.
Regions Bank, as Trustee
By:
Authorized Signature
Date of Authentication:
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(d) Form of Assignment ment
Assignment
For value received, the undersigned hereby sells, assigns, and transfers unto
(Please print or type name, address, and zip code of Transferee)
(Please insert Social Security or Taxpayer Identification Number of Transferee)
the within Series 2012 Bond and all rights thereunder, and hereby irrevocably
constitutes and appoints
attorney to transfer said Series 2012 Bond on the books kept for registration thereof,
with full power of substitution in the premises.
DATED:
Signature Guaranteed:
Registered Owner
NOTICE: Signature(s) must be guaranteed NOTICE: The signature above must
by an institution which is a participant in correspond to the name of the Registered
the Securities Transfer Agent Medallion Owner as shown on the face of this Bond
Program ("STAMP") or similar program. in every particular, without any alteration,
enlargement or change whatsoever.
(e) The Initial Series 2012 Bond shall be in the form set forth in paragraphs
(a), (b) and (d) of this Section, except for the following alterations:
(i) the Initial Series 2012 Bond shall be numbered I-1
Section 4.2: Legal Opinion. The approving opinion of Bond Counsel may be
printed on the Series 2012 Bonds, but errors or omissions in the printing of such opinion
or such numbers shall have no effect on the validity of the Series 2012 Bonds.
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ARTICLE V
ADDITIONAL BONDS
Section 5.1: Additional Parity Bonds. The Authority reserves the right to
issue, for any lawful purpose (including the refunding of any previously issued Parity
Bonds), one or more series of Additional Parity Bonds payable from and secured by a
lien on the Pledged Revenues, on a parity with the Series 2012 Bonds, and any
previously issued Parity Bonds; provided, however, that Additional Parity Bonds may
be issued only in accordance with the provisions of Article III of the Indenture.
Section 5.2: Subordinate Lien Obligations. The Authority reserves the right
to issue, for any lawful purpose, bonds, notes or other obligations secured in whole or
in part by liens on the Pledged Revenues that are junior and subordinate to the lien on
Pledged Revenues securing payment of the Parity Bonds. Such subordinate lien
obligations may be further secured by any other source of payment lawfully available
for such purposes.
ARTICLE VI
COVENANTS AND PROVISIONS
RELATING TO ALL PARITY BONDS
Reference is made to Article V of the Indenture. All covenants made by the
Authority therein are hereby incorporated into this Resolution.
ARTICLE VII
PROVISIONS CONCERNING SALE AND
APPLICATION OF PROCEEDS OF SERIES 2012 BONDS
Section 7.1: Sale. The Series 2012 Bonds are hereby sold to the Purchaser by
means of a private placement, and the price at the par value thereof, is hereby approved
and delivery of the Series 2012 Bonds to the Purchaser shall be made upon payment
therefor in accordance with the terms of sale and the terms and conditions of the Private
Placement Letter, which is attached hereto as Exhibit A, and is hereby approved, and
such price and terms are hereby found and determined to be the most advantageous
reasonably obtainable by the Authority. The Chair and other appropriate officers,
agents and representatives of the Authority are hereby authorized to do any and all
things necessary or desirable to provide for the issuance and delivery of the Series 2012
Bonds.
Section 7.2: Application of Proceeds. Proceeds from the sale of the Series
2012 Bonds shall, promptly upon receipt by the Trustee, be applied as follows:
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(a)$53,665,000 from proceeds, together with 1,081,723.28 from the
Authority's Reserve Fund, shall be deposited to the Escrow Fund for the
Refunded Bonds.
(b)$3,250,000 from proceeds shall be deposited in the Project Fund.
(c)$289,500 from proceeds shall be used to pay Cost of Issuance.
(d)All remaining proceeds from the sale of the Series 2012 Bonds shall be
deposited into the Debt Service Fund.
Section 7.3: Redemption of Refunded Bonds. To restructure the annual debt
service requirements of the Authority in order to create a debt service savings, the
Authority hereby authorizes and directs that the Refunded Bonds be called for
redemption prior to maturity (or, if applicable, escrowed to their respective maturities)
in the amounts, at the dates and at the redemption prices set forth in Exhibit E attached
hereto, and the Chair is hereby authorized and directed to take all necessary and
appropriate action to give or cause to be given a notice of redemption and/or a notice of
defeasance to the holders or paying agent/registrars, as appropriate, of such bonds,
and, if required, to publish such notices, all in the manner required by the documents
authorizing the issuance of such Refunded Bonds.
Section 7.4: Escrow of Agreement. The discharge and defeasance of the
Refunded Bonds shall be effectuated pursuant to the terms and provisions of the
Escrow Agreement to be entered into by and between the Authority and the Escrow
Agent, which shall be substantially in the form attached hereto as Exhibit C, the terms
and provisions of which are hereby approved, subject to such insertions, additions and
modifications as shall be necessary (a) to carry out the program designed for the
Authority by its financial advisor, which shall be certified as to mathematical accuracy
by Grant Thornton LLP, whose Report shall be attached to the Escrow Agreement, (b)
to comply with all applicable laws and regulations relating to the refunding of the
Refunded Bonds (c) to minimize the Authority's cost of refunding and (d) to carry out
the other intents and purposes of this Resolution, and the Chair is hereby authorized to
execute and deliver such Escrow Agreement on behalf of the Authority in multiple
counterparts and the Authority Secretary is hereby authorized to attest thereto.
Section 7.5: Purchase of Escrowed Securities. To assure the purchase of the
Escrowed Securities referred to in the Escrow Agreement, the Chair or other .authorized
officer of the Authority is hereby authorized (a) to subscribe for, agree to purchase and
purchase such obligations of the United . States of America, in such amounts and
maturities and bearing interest at such rates as may be provided for in the Report to be
attached to the Escrow Agreement, and to execute any and all subscriptions, purchase
agreements, commitments, letters of authorization and other documents necessary to
effectuate the foregoing, and any actions heretofore taken by such officials for such
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purpose are hereby ratified and approved, and (b) to authorize such contributions to
the Escrow Fund as are provided in the Escrow Agreement.
ARTICLE VIII
TAX EXEMPTION
Section 8.1: Federal Income Tax Exclusion. (a) General. The Authority
intends that the interest on the Series 2012 Bonds shall be excludable from gross income
for federal income tax purposes pursuant to sections 103 and 141 through 150 of the
Internal Revenue Code of 1986, as amended (the 'Code), and the applicable Income Tax
Regulations (the "Regulations"). The Authority covenants and agrees not to take any
action, or knowingly omit to take any action within its control, that if taken or omitted,
respectively, would cause the interest on the Series 2012 Bonds to be includable in gross
income, as defined in section 61 of the Code, for federal income tax purposes. In.
particular, the Authority covenants and agrees to comply with each requirement of this
Section 8.1; provided, however, that the Authority shall not be required to comply with
any particular requirement of this Section 8.1 if the Authority has received an opinion of
nationally recognized bond counsel ("Counsel's Opinion") that such noncompliance
will not adversely affect the exclusion from gross income for federal income tax
purposes of interest on the Series 2012 Bonds or if the Authority has received a
Counsel's Opinion to the effect that compliance with some other requirement set forth
in this Section 8.1 will satisfy the applicable requirements of the Code and the
Regulations, in which case compliance with such other requirement specified in such
Counsel's Opinion shall constitute compliance with the corresponding requirement
specified in this Section 8.1.
(b)No Private Use or Payment and No Private Loan Financing. The
Authority shall certify, through an authorized officer, employee or agent that based
upon all facts and estimates known or reasonably expected to be in existence on the
date the Series 2012 Bonds are delivered, that proceeds of the Series 2012 Bonds will not
be used, in a manner that would cause the Series 2012 Bonds to be "private activity
bonds" within the meaning of section 141 of the Code and the Regulations promulgated
thereunder. Moreover, the Authority covenants and agrees that it will make such use of
the proceeds of the Series 2012 Bonds including interest or other investment income
derived from Bond proceeds, regulate the use , of property financed, directly or
indirectly, with such proceeds, and take such other and further action as may be
required so that the Series 2012 Bonds will not be "private activity bonds" within the
meaning of section 141 of the Code and the Regulations promulgated thereunder.
(c)No Federal Guarantee. The Authority covenants and agrees that it has not
and will not take any action, and has not knowingly omitted and will not knowingly
omit to take any action within its control, that, if taken or omitted, respectively, would
cause the Series 2012 Bonds to be federally guaranteed within the meaning of section
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HOU:3209953. 10
149(b) of the Code and the applicable Regulations thereunder, except as permitted by
section 149(b)(3) of the Code and such Regulations.
(d)No Hedge Bonds. The Authority covenants and agrees that it has not and
will not take any action, and has not knowingly omitted and will not knowingly omit to
take any action, within its control, that, if taken or omitted, respectively, would cause
the Series 2012 Bonds to be hedge bonds within the meaning of section 149(g) of the
Code and the applicable Regulations thereunder.
(e)No Arbitrage. The Authority shall certify, through an authorized officer,
employee or agent that based upon all facts and estimates known or reasonably
expected to be in existence on the date the Series 2012 Bonds are delivered, the
Authority will reasonably expect that the proceeds of the Series 2012 Bonds will not be
used in a manner that would cause the Series 2012 Bonds to be "arbitrage bonds"
within the meaning of section 148(a) of the Code and the applicable Regulations
promulgated thereunder. Moreover, the Authority covenants and agrees that it will
make such use of the proceeds of the Series 2012 Bonds including interest or other
investment income derived from Bond proceeds, regulate investments of proceeds of
the Series 2012 Bonds, and take such other and further action as may be required so that
the Series 2012 Bonds will not be "arbitrage bonds" within the meaning of section 148(a)
of the Code and the applicable Regulations promulgated thereunder.
(f)Arbitrage Rebate. If the Authority does not qualify for an exception to the
requirements of Section 148(f) of the Code relating to the required rebate to the United
States, the Authority will take all necessary steps to comply with the requirement that
certain amounts earned by the Authority on the investment of the "gross proceeds" of
the Series 2012 Bonds (within the meaning of section 148(f)(6)(B) of the Code), be
rebated to the federal government. Specifically, the Authority will (i) maintain records
regarding the investment of the gross proceeds of the Series 2012 Bonds as may be
required to calculate the amount earned on the investment of the gross proceeds of the
Series 2012 Bonds separately from records of amounts on deposit in the funds and
accounts of the Authority allocable to other bond issues of the Authority or moneys
which do not represent gross proceeds of any bonds of the Authority, (ii) calculate at
such times as are required by applicable Regulations, the amount earned from the
investment of the gross proceeds of the Series 2012 Bonds which is required to be
rebated to the federal government, and (iii) pay., not less often than every fifth
anniversary date of the delivery of the Series 2012 Bonds or on such other dates as may
be permitted under applicable Regulations, all amounts required to be rebated to the
federal government. Further, the Authority will not indirectly pay any amount
otherwise payable to the federal government pursuant to the foregoing requirements to
any person other than the federal government by entering into any investment
arrangement with respect to the gross proceeds of the Series 2012 Bonds that might
result in a reduction in the amount required to be paid to the federal government
because such arrangement results in a smaller profit or a larger loss than would have
23
HOU:3209953.10
resulted if the arrangement had been at arm's length and had the yield on the issue not
been relevant to either party.
(g)Information Reporting. The Authority covenants and agrees to file or
cause to be filed with the Secretary of the Treasury, not later than the 15th day of the
second calendar month after the close of the calendar quarter in which the Series 2012
Bonds are issued, an information statement concerning the Series 2012 Bonds, all under
and in accordance with section 149(e) of the Code and the applicable Regulations
promulgated thereunder.
(h)Continuing Obligation. Notwithstanding any other provision of this
Resolution, the Authority's obligations under the covenants and provisions of this
Section 8.1 shall survive the defeasance and discharge of the Series 2012 Bonds.
Section 8.2: Continuing Obligation. Notwithstanding any other provision of
this Resolution, the Authority's representations and obligations under the covenants
and provisions of this Article VIII shall survive the defeasance and discharge of the
Series 2012 Bonds for as long as such matters are relevant to the exclusion of interest on
the Bonds from the gross income of the owners for federal income tax purposes.
Section 8.3: Qualified Tax-Exempt Obligations. The Series 2012 Bonds are
NOT Qualified Tax-Exempt Obligations for financial institutions.
ARTICLE IX
AUTHORIZATION AND CONFIRMATION OF AGREEMENTS
Section 10.1: Agreements. The Board hereby approves issuance of the Series
2012 Bonds and all reasonable agreements necessary or convenient in connection with
the issuance of the Series 2012 Bonds, including without limitation the following:
Private Placement Letter by and between the Authority and Capital One Public
Funding, LLC, the Purchaser, in the form attached hereto as Exhibit A; the
Paying/Agent Agreement attached hereto as Exhibit B; the Escrow Agreement attached
hereto as Exhibit C; the Indenture attached hereto as Exhibit D; and any and all other
documents and agreements reasonable and necessary to issue the Series 2012 Bonds
(collectively, the "Agreements"). The Board, by a majority vote of its members, at a
regular meeting, hereby approves the form, terms, and provisions of the Agreements
and authorizes the execution and delivery of the Agreements.
!01
HOU:3209953.10
ARTICLE X
MISCELLANEOUS
Section 10.1: Further Proceedings. The Chair, Vice Chair, Secretary,
Directors, and other appropriate officials of the Authority are hereby authorized and
directed to do any and all things necessary and/or convenient to carry out the intent,
purposes and terms of this Resolution, including the execution and delivery of such
certificates, documents or papers necessary and advisable.
Section 10.2: Severability. If any Section, paragraph, clause or provision of
this Resolution shall for any reason be held to be invalid or unenforceable, the invalidity
or unenforceability of such Section, paragraph, clause or provision shall not affect any
of the remaining provisions of this Resolution.
Section 10.3: Open Meeting. It is hereby officially found and determined that
the meeting at which this Resolution was adopted was open to the public, and that
public notice of the time, place and purpose of said meeting was given, all as required
by the Texas Open Meetings Act.
Section 10.4: Parties Interested. Nothing in this Resolution expressed or
implied is intended or shall be construed to confer upon, or to give to, any person or
entity, other than the Authority, the Paying Agent/Registrar, the Trustee and the
Owners of the Series 2012 Bonds, any right, remedy or claim under or by reason of this
Resolution or any covenant, condition or stipulation hereof, and all covenants,
stipulations, promises and agreements in this Resolution shall be for the sole and
exclusive benefit of the Authority, the Paying Agent/Registrar, the Trustee and the
Owners of the Series 2012 Bonds.
Section 10.5: Repealer. All orders, resolutions and ordinances, or parts
thereof, inconsistent herewith are hereby repealed to the extent of such inconsistency.
Section 10.6: Effective Date. This Resolution shall become effective
immediately upon passage by this Authority and signature of the Chair, Vice Chair, or
Director of the Authority.
[Execution Page Follows]
25
HOU:3209953.10
PASSED AND APPROVED this 30 th day of April, 2012.
/s/ Tom Reid
By:
Chair, Board of Directors
ATTEST:
/s/ Ed Baker
By:
Secretary, Board of Directors
HOU:3209953.10
Exhibits
A.Private Placement Letter (Tab 2)
B.Paying Agent Agreement (Tab 17)
C.Escrow Agreement (Tab 3)
D.Indenture (Tab 8)
E.Refunded Bonds (Attached to Escrow Agreement)
HOU:3209953.10
DEVELOPMENT AUTHORITY OF PEARLAND
$56,915,000 TAX INCREMENT CONTRACT REVENUE
AND REFUNDING BONDS, SERIES 2012
TRANSCRIPT OF PROCEEDINGS
May 22, 2012
Andrews Kurth LLP
600 Travis, Suite 4200
Houston, Texas 77002
(713) 220-4200
HOU:3191335.5
ALLEN BOONE HUMPHRIES ROBINSON LLP
ANDREWS KURTH LLP
3200 SOUTHWEST FREEWAY 600 TRAvIs
SUITE 2600
SUITE 4200
HOUSTON, TEXAS 77027
HOUSTON, TEXAS 77002
May 22, 2012
Development Authority of Pearland
Pearland, Texas
Capital One Public Funding, LLC, as Purchaser
Melville, New York
Regions Bank
Houston, Texas
Wells Fargo Bank, National Association
Dallas, Texas
We have acted as Co-Bond Counsel to the Development Authority of Pearland
(the "Issuer") in connection with the issuance and sale of the Issuer's Tax Increment
Contract Revenue and Refunding Bonds, Series 2012, in the aggregate principal amount
of $56,915,000 (the "Bonds") pursuant to the terms of a Trust Indenture dated as of
April 30, 2012 (the "Indenture"), between the Issuer and Regions Bank (the "Trustee"),
and a Bond Resolution, dated as of May 1, 2012 (the "Resolution"). Except as otherwise
indicated, terms defined in the Indenture are used in this opinion with the meanings
assigned to them in the Indenture.
In our capacity as Co-Bond Counsel, we have participated in the preparation of
and have examined a transcript containing certified copies of certain proceedings of the
Board of Directors of the Issuer, and certain certificates and other documents of
representatives of the City of Pearland, Texas (the "City"), Reinvestment Zone Number
Two, City of Pearland, Texas (the "Zone"), Alvin Independent School District ("AISD"),
Brazoria County, Fort Bend County, the Issuer, the Trustee, and of others. We have
relied upon those certificates as to certain factual matters which we have not
independently verified. We have also examined such portions of the Constitution and
statutes of the State of Texas, and such applicable provisions of the Internal Revenue
Code of 1986, as amended (the "Code"), court decisions, regulations and published
rulings of the Internal Revenue Service, as we have deemed necessary for the purposes
of this opinion.
Reference is made to an opinion of even date of the City Attorney of the City
with respect to, among other matters, the authority of the City to enter into and perform
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its obligations under the Tri-Party Agreement and the participation agreements with
AISD, Brazoria County and Fort Bend County and their authorization, execution,
delivery, binding effect and enforceability by and upon the City.
Based on the foregoing, and subject to the matters set forth below, we are of the
opinion that:
1.The Issuer is duly created and validly existing as a Texas nonprofit local
government corporation acting on behalf of the City created pursuant to
Chapter 431, Texas Transportation Code, and has the corporate power to
adopt the Resolution, enter into and perform the obligations under the
Indenture, and issue the Bonds. The transcript of proceedings evidences
complete legal authority for the issuance of the Bonds in full compliance
with the Constitution and the laws of the State of Texas presently
effective.
2.The Indenture and Resolution have been duly authorized by the Issuer,
have been duly executed and delivered by the Issuer and constitute valid
and binding obligations of the Issuer. By the terms of the Indenture, all of
the Issuer's right, title and interest in and to the Pledged Revenues, which
include the Contract Tax Increments and the amounts required from time
to time to be deposited in or credited to the account of the Debt Service
Fund, the Reserve Fund, and the Pledged Revenue Fund created pursuant
to the Indenture, together with any investments and reinvestments
thereof, have been assigned to the Trustee.
3.The Bonds have been duly authorized, executed, issued and delivered by
the Issuer and are the legal and valid obligations of the Issuer. The Bonds
are entitled to the benefits and security of the Indenture. The Bonds are
payable by the Issuer out of the Pledged Revenues created by the
Indenture and the revenues derived therefrom.
4.The Bonds are limited obligations solely of the Issuer and are not general
obligations of the Issuer, the State of Texas, Brazoria County, Fort Bend
County, the City, AISD, or any other entity. The Issuer has no authority to
levy taxes.
5.The transcript of certified proceedings evidences that firm banking and
financial arrangements have been made for the discharge and final
payment of the bonds being refunded pursuant to an escrow agreement
entered into between the District and the Escrow Agent on or effective as
of the date of delivery of the Bonds, and that therefore such bonds are
deemed to be fully paid and no longer outstanding under the Indenture of
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Trust dated November 15, 2004, between the Issuer and Wells Fargo Bank,
National Association, as Trustee, as supplemented and amended to date,
except for the purpose of being paid from the funds provided therefor in
such escrow agreement.
6. We have examined executed Bond numbered IB-1. In our opinion, the
form of said Bond and its execution is regular and proper.
IT IS OUR FURTHER OPINION that:
1.Interest on the Bonds is excludable from gross income of the holders
thereof for federal income tax purposes under existing law.
2.Interest on the Bonds is not includable in the alternative minimum tax on
individuals and corporations, except that interest on the Bonds will be included in the
"adjusted current earnings" of a corporation (other than any S corporation, regulated
investment company, REIT, REMIC or FASIT) for purposes of computing its alternative
minimum tax liability.
In providing such opinions, we have relied on representations of the Issuer, the
City, the Issuer's financial advisors, the Zone, and the Purchaser (as defined in the Bond
Resolution), with respect to matters solely within the knowledge of the Issuer, the City,
the Issuer's financial advisors, the Zone, and the Purchaser, which we have not
independently verified, and have assumed continuing compliance with the covenants
in the Indenture and Resolution pertaining to those sections of the Code which affect
the exclusion from gross income of interest on the Bonds for federal income tax
purposes. We further have relied on the Verification Report of Grant Thornton L.L.P. of
even date herewith with regard to the mathematical accuracy of certain computations.
In the event that such representations or report are determined to be inaccurate or
incomplete, interest on the Bonds could become includable in gross income from the
date of their original delivery, regardless of the date on which the event causing such
inclusion occurs.
Except as stated above, we express no opinion as to any federal, state or local tax
consequences resulting from the ownership of, receipt or accrual of, interest on, or
acquisition, ownership or disposition of, the Bonds.
Owners of the Bonds should be aware that the ownership of tax-exempt
obligations may result in collateral federal income tax. consequences to financial
institutions, property and casualty insurance and life insurance companies, certain S
corporations with Subchapter C earnings and profits, individual recipients of Social
Security or Railroad Retirement benefits, taxpayers who may be deemed to have
incurred or continued indebtedness to purchase or carry tax-exempt obligations,
taxpayers owning an interest in a FASIT that holds tax-exempt obligations and
individuals otherwise qualifying for the earned income credit. In addition, certain
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foreign corporations doing business in the United States may be subject to the "branch
profits tax" on their effectively-connected earnings and profits (including tax-exempt
interest such as interest on the Bonds).
The opinions set forth above are based on existing law, which is subject to
change. Such opinions further are based on our knowledge of facts as of . the date
hereof. We assume no duty to update or supplement these opinions to reflect any facts
or circumstances that may hereafter come to our attention or to reflect any changes in
any law that may hereafter occur or become effective. Moreover, our opinions are not a
guarantee of result and are not binding on the Internal Revenue Service (the "Service");
rather, such opinions represent our legal judgment based upon our review of existing
law and in reliance upon the representations and covenants referenced above that we
deem relevant to such opinions. The Service has an ongoing audit program to
determine compliance with rules that relate to whether interest on state or local
obligations is includable in gross income for federal income tax purposes. No assurance
can be given whether or not the Service will commence an audit of the Bonds. If an
audit is commenced, in accordance with its current published procedures, the Service is
likely to treat the Issuer as the taxpayer. We observe that the Issuer has covenanted in
the Resolution not to take any action, or omit to take any action within its control, that if
taken or omitted, respectively, may result in the treatment of interest on the Bonds as
includable in gross income for federal income tax purposes.
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385293