HomeMy WebLinkAboutResolution - 3554 - Agreement - Science Spectrum - Land Acqusition & Management For Omnimax Theater - 02/28/1991Resolution No. 3554
February 28, 1991
Item #22
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RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the Mayor of the City of Lubbock BE and is hereby authorized and
directed to execute for and on behalf of the City of Lubbock a Land Acqui-
sition and Management Agreement between the City of Lubbock and Science
Spectrum, attached herewith, which shall be spread upon the minutes of the
Council and as spread upon the minutes of this Council shall constitute and
be a part of this Resolution as if fully copied herein in detail.
Passed by the City Council this 28th day of February , 1991.
B. C. MCMIN , MAYOR
ATTEST:
ngtte uoya, city secr
APPROVED AS TO CONTENT:
J. -Robert Massengale,
Assistant City Manager
APPROVED AS TO FORM:
Do d G. Vandiver,
First Assistant City Attorney
LETTER OF AGREEMENT BY SCIENCE SPECTRUM
REGARDING ACCESS AND PARKING FOR AND TO CITY
OF LUBBOCK AT SCIENCE SPECTRUM EXHIBIT HALL AREA
In consideration of a reservation for access and parking in
favor of Science Spectrum, contained in the first paragraph of the
second page of a General Warranty Deed from Science Spectrum to the
City of Lubbock, conveying Lot 3E, Times Square Addition to the
City of Lubbock, Lubbock County, Texas, the undersigned Science
Spectrum acting through its President hereunto duly authorized to
act on its behalf, do hereby promise and agree to grant to the City
of Lubbock a similar easement by grant to the City of Lubbock, as
is made by said reservation for access and parking in favor of
Science Spectrum in the event that the City of Lubbock needs and
requires such a reciprocal access and parking easement so as to
properly comply with the Planning, Building, Zoning, and Fire and
any Safety Regulations of the City of Lubbock or State of Texas in
such cases made and provided so long as the Science Exhibit Hall
use is continued in the area.
EXECUTED this the day of , 1991.
SCIENCE SPECTRUM
BY•
CASSANDRA L. HENRY, President
LAND ACQUISITION AND
MANAGEMENT AGREEMENT
between
The City of Lubbock, Texas
and
Science Spectrum
Dated as of February 28, 1991
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TABLE OF CONTENTS
Page
RECITALS . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND GENERAL PROVISIONS
Section
1.1.
Definitions . . . . . . . . . . . . . .
3
Section
1.2.
Definitions of General Terms . . . . .
9
Section
1.3.
Computations . . . . . . . . . . . . . .
10
Section
1.4.
Certificates and Opinions . . .
11
Section
1.5.
Exhibits . . . . . . . . . . . . . . . .
12
Section
1.6.
Benefits of Agreement . . . . . . . . .
12
Section
1.7.
Inconsistent Provisions . . . . . . .
13
Section
1.8.
Governing Law . . . . . . . . . . . . .
13
Section
1.9.
Incorporation of Recitals of the Parties
14
Section
1.10.
Notices -Waivers . . . . . . . . . . . .
14
Section
1.11.
Construction of Terms . . . . . . . . .
1.5
Section
1.12.
Public Meeting . . . . . . . . . . . . .
15
Section
1.13.
Effective Date . . . . . . . . . . . . .
16
Section
1.14.
Term of Agreement . . . . . . . . .
16
Section
1.15.
Waivers and Amendments . . . . . . . . .
16
Section
1.16.
Successors and Assigns . . . . . . . . .
17
Section
1.17.
Counterparts . . . . . . . . . . . . . .
17
Section
1.18.
Table of Contents; Article Titles;
Captions . . . . . . . . . . . . . . .
17
Section
1.19.
Entire Agreement . . . . . . . . . . . .
18
Section
1.20.
Partial Invalidity . . . . . . . . . . .
18
Section
1.21.
Further Assurances . . . . . . . . . . .
18
ARTICLE TWO
CITY'S INTENDED FINANCING
Section 2.1. City to Issue Obligations . . . . . . . 19
Section 2.2. Authority Retained in City . . . . 19
Section 2.3. Conditions to Issuance of Obligations 21
ARTICLE THREE
CREATION OF FUNDS AND ACCOUNTS;
CREDITS THERETO AND PAYMENTS THEREFROM
Section
3.1.
Creation of City Funds and Accounts
26
Section
3.2.
Deposits to Exhibition Hall/
Auditorium Fund . . . . . . . . . . .
26
Section
3.3.
Deposits to Construction Fund . . . . .
26
Section
3.4.
Payments from Exhibition Hall/
Auditorium Fund . . . . . . . . . . .
27
Section
3.5.
Payments from Construction Fund . . . .
29
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ARTICLE FOUR
CONVEYANCE OF PROPERTY
Section
4.1.
Agreement to Convey and Accept . . .
. . 31
Section
4.2.
Closing . . . . . . . . . . . . . .
. . 32
Section
4.3.
Conditions to Closing . . . .
. . 34
Section
4.4.
Evidence of Title . . . . . . . . .
. . 35
Section
4.5.
Representations and Warranties . . .
. . 38
Section
4.6.
The Manager's Covenants . . . . . .
. . 39
Section
4.7.
Prorations . . . . . . . . . . . . .
. . 40
Section
4.8.
Title Charges . . . . . . . . . . .
. . 40
Section
4.9.
Risk of Loss . . . . . . . . . . .
. . 40
Section
4.10.
Condemnation . . . . . . . . ... . .
. . 41
Section
4.11.
Default by the Manager . . . . . .
. . 42
Section
4.12.
Time of Essence . . . . . . . . .
. . 42
Section
4.13.
Further Assurances . . . . . . . . .
. . 42
Section 5.1.
Section 5.2.
Section 5.3.
Section 5.4.
Section 5.5.
Section 5.6.
Section 5.7.
Section 5.8.
Section 5.9.
Section 5.10.
Section 5.11.
Section 5.12.
Section 5.13.
Section 5.14.
Section 5.15.
Section 5.16.
Section 5.17.
ARTICLE FIVE
MANAGEMENT AGREEMENT
Retention of Services . . . . . . . . .
43
Manager's Authority . . .. . .
43
Control Retained in the City . . . . . .
44
Relationship of the Parties . . . . . .
45
Management of the Exhibition Hall/
6.3.
Auditorium . . . . . . . . . . . . . .
46
Employees . . . . . . . . . . . . . .
47
Administrator . . . . . . . . . . . . .
48
Inside Consultants . . . . . . . . . . .
48
Outside Consult -ants . . . .i. . .
48
Recommendations Concerning Operations
49
Legal Compliance . . . . . . . . . . . .
49
Insurance. . . . . . . . . . . . . . .
49
Rate and Fee Schedule . . . . . . . . .
50
Preparation and Adoption of Annual
Budget . . . . . . . . . . . . . . . .
50
Accounting Records . . . . . . . . . . .
51
Manager's Covenants Regarding Maintenance
of Tax -Exempt Status of Certificates of
Obligation . . . . . . . . . . . . .
52
Ownership in City . . . . . . . . . . .
61
ARTICLE SIX
DEFAULTS AND REMEDIES
Section
6.1.
Events of Default . . . . . . . . .
. 62
Section
6.2.
Remedies . . . . . . . . . . . . . . .
. 64
Section
6.3.
Waiver of Stay or Extension Laws . . .
. 65
Section
6.4.
Undertaking for Costs . . . . . . . .
. 65
Section
6.5.
Termination of Proceedings . . . . . .
. 66
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ARTICLE SEVEN
PURCHASE OPTION
Section 7.1. Conditional Agreement of Purchase and
Sale. . . . . . . . . . . . . . . . 67
Section 7.2. Preservation of Status of Property . . . 69
Section 7.3. Proceeds of Sale . . . . . . . . . . . . 70
SIGNATURE PAGE
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71
This Land Acquisition and Management Agreement (the
"Agreement") is made and entered into as of the 28th day of
February, 1991 by and between the City of Lubbock, Texas (the
"City"), a home -rule city of the State of Texas duly organized
and existing pursuant to its charter and the laws of the State
of Texas, and Science Spectrum (the "Manager"), a non-profit
corporation organized under the laws of the State of Texas and
qualified as a tax exempt organization under Section 501(a) of
the Internal Revenue Code as an organization described in
Section 501(c)(3) of the Internal Revenue Code; for the
following purposes and considerations, to -wit:
RECITALS OF THE PARTIES
WHEREAS, the Manager has been actively engaged in the
development and promotion of educational and scientific
demonstrations and exhibits in the City, and
WHEREAS, IMAX Systems Corporation ("ISC") of Toronto,
Ontario, Canada, is one of the world's leading designers,
manufacturers, and producers of audiovisual equipment used in
the production of exhibitions for cultural, scientific, and
educational purposes, and
WHEREAS, ISC has provided the necessary audiovisual
equipment for the establishment of exhibition halls/auditoriums
in a number of locations in the United States and such
exhibition halls/auditoriums have demonstrated their value in
advancing the cultural, educational, and scientific development
of the communities in which they are located, and
WHEREAS, the Manager has entered into arrangements with
ISC for the delivery of a system suitable for the operation of
an exibition hall/auditorium in the City, to be used for
presentation of cultural, scientific, and educational programs,
which arrangement includes the lease of necessary audiovisual
equipment which is subject to patent and trademark rights owned
by ISC, and
WHEREAS, the City, for the benefit of all the citizens
of the. City, desires to provide, pursuant to statutory
authority in Tex. Rev. Civ. Stat. Ann. art. 1269j-4.1 (Vernon
Supp. 1991), an exhibition hall/auditorium for cultural,
educational, and scientific programs and to contract with the
Manager in the acquisition of certain land and the management
of an exhibition hall/auditorium utilizing audiovisual
equipment of the type provided by ISC, and
WHEREAS, the City and the Manager desire to enter into
this Agreement for the purpose of evidencing their respective
agreements and intentions concerning such project:
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NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements herein set forth, the parties
hereto agree as follows:
ARTICLE ONE
DEFINITIONS AND GENERAL PROVISIONS
Section 1.1. Definitions. In this Agreement the
following terms have the following respective meanings unless
the context hereof clearly requires otherwise:
"Account" means any of the accounts referred. to herein
or created or affirmed by an Ordinance.
"Act" means Tex. Rev. Civ. Stat. Ann. art 1269j-4.1
(Vernon Supp. 1991) as now in effect or as hereafter amended.
"Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified
Person. For purposes of this definition, "control" when used
with respect to any specified Person means the power to direct
the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities
or the power to appoint and remove its directors, by contract,
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or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agreement" means this Land Acquisition and Management
Agreement as originally executed or as amended from time to
time by the parties.
"Bond Counsel" means any attorney or firm of attornies
of nationally recognized standing in the field of municipal
bond law.
"Budget" means the annual budget for the operation and
maintenance of the Exhibition Hall/Auditorium.
"Business Day" means any day other than (1) a Saturday
or a Sunday, (2) a legal holiday or the equivalent on which
banking institutions generally are authorized or requested to
close in the City, or (3) a day of which the New York Stock
Exchange is closed.
"Certificate Concerning Tax -Exempt Status and Related
Matters" means a certificate, in form and substance
satisfactory to Bond Counsel, to be executed by an authorized
officer of the Manager as of the Issue Date, relating to such
matters as Bond Counsel may deem necessary in order to opine
regarding the status of the interest on the Certificates under
federal income tax law.
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"Certificates of Obligation" means the combination tax
and limited exhibition hall/auditorium revenue certificates of
obligation of the City issued for the purpose of financing the
construction and improvement of the exhibition/hall auditorium
and the acquisition of the Site.
"City" means the City of Lubbock, Texas.
"Closing" has the meaning given in Section 4.2.(a).
"Closing Date" has the meaning given in Section 4.2.(a).
"Code" means the Internal Revenue Code of 1986, as
amended and in force and effect on the Issue Date.
"Contractual Obligations" means the general obligation
contractual obligations of the City issued for the purpose of
financing acquisition of an interest in the Equipment.
"Counsel" means an attorney or attornies selected by the
Person such Counsel represents and qualified to perform the
services required of such Counsel under this Agreement.
"Effective Date" means the date specified in Section
1.13.
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"Equipment" means the personal property leased by ISC to
the Manager pursuant to the Lease.
"Event of Default" means the occurrence of any event
specified as an Event of Default in Section 6.1.
"Exempt Person" means any organization described in
Section 501(c)(3) of the Code and exempt from tax under Section
501(a) of the Code, the District of Columbia, any state of the
United States, any possession of the United States, and any
political subdivision of any such State or possession if such
political subdivision has more than an insubstantial amount of
any of the power to tax, the power of eminent domain, or the
police power.
"Exhibition Hall/Auditorium" means the public building
of the City owned and operated pursuant to authority granted in
the Act, located on the Site, and the construction and
improvement of which is financed by the Certificates.
"Fiscal Year" means the twelve-month accounting period
of the Person with respect to which such term is used.
"Fund" means any of the funds referred to in this
Agreement or created or affirmed by an Ordinance.
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"Gross Revenues" means all receipts, revenues, and
moneys of every kind paid or payable to the City as a result or
consequence of owning the Site, Exhibition Hall/Auditorium, or
an interest in the Equipment (other than restricted grants or
gifts and proceeds of instruments).
it ISCIImeans IMAX Systems Corporation of Toronto,
Ontario, Canada.
"Instruments" means the Certificates and the Contractual
Obligations, collectively.
"Issue Date" means, as to the Instruments, the date of
the authentication and delivery of the initial obligations of
the Instruments in exchange for the purchase price therefor.
"Lease" means the System Lease Agreement between the
Manager and ISC.
"Maintenance and Operating Expenses" means the expenses
of operation and maintenance of the Site, the Exhibition
Hall/Auditorium, and the Equipment, including, without
limitation, all salaries, management fees, labor, materials,
interest, repairs and additions necessary to render efficient
service, and all payments required to be made to ISC under the
Lease.
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"Manager" means Science Spectrum.
"Net Revenues means Gross Revenues less Maintenance and
Operating Expenses.
"Official Statement" means any disclosure document or
combination of documents prepared in connection with the
offering and issuance of the Instruments.
"Opening" means the date upon which the Exhibition
Hall/Auditorium is ready for use as certified in writing by the
Manager to the City.
"Opinion of Counsel" means a written opinion of Counsel.
"Ordinance" means the written document or documents in
the form finally approved and adopted by the City Council of
the City authorizing the issuance of the Certificates or the
Contractual Obligations.
"Person" means any individual, corporation, partnership,
joint venture, association, joint-stock company, trust,
unincorporated organization, or government or any agency or
political subdivision thereof.
"Primary Goal" has the meaning given in Section 5.1.
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"Purchase Price" means $ 650,000.00 being the total
amount to be paid by the City to the Manager at Closing on the
Closing Date for the acquisition of the Site, exclusive of all
Costs of Closing.
"Regulations" means the applicable proposed, temporary,
or final Income Tax Regulations promulgated under the Code, as
such regulations may be amended or supplemented from time to
time.
"Site" has the meaning given in Section 4.1.(a).
"Statutes" means the statutory authority for the
authorization and issuance of the Instruments.
"Term" has the meaning given in Section 1.14.
"Written Policies and Procedures" means written
directions, orders, or guidelines of the City relating to the
operation and management of the Exhibition Hall/Auditorium and
Equipment as in effect from time to time and delivered to the
Manager.
Section 1.2. Definitions of General Terms. Unless the
context shall clearly indicate otherwise, or may otherwise
require, in this Agreement the terms "herein", "hereunder",
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"hereby", "hereto", "hereof" and any similar terms refer
to this Agreement as a whole and not to any particular article,
section or subdivision hereof.
Unless the context shall clearly indicate otherwise, or
may otherwise require, in this Agreement: (i) references to
articles, sections and other subdivisions, whether by number or
letter or otherwise, are to the respective or corresponding
articles, sections or subdivisions of this Agreement as such
articles, sections or subdivisions may be amended from time to
time; (ii) references to articles, chapters, subchapters and
sections of the Statutes, or to any public law or other statute
of the United States or any section thereof, are to the
respective or corresponding articles, chapters, subchapters,
sections and statutes as they may be amended from time to time;
(iii) the word "heretofore" means before the date of
execution of this Agreement, the word "now" means at the date
of execution of this Agreement, and the word "hereafter"
means after the date of execution of this Agreement.
Section 1.3. Computations. Unless the person making
the computation has actual knowledge that facts shall then be
otherwise, all computations required for the purposes of this
Agreement shall be made on the assumption that: (i) the
principal of and interest on the Instruments shall be paid as
and when the same become due; and (ii) all credits required by
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this Agreement to be made to any Fund or Account shall be made
in the amounts and at the times required.
Section 1.4. Certificates and Opinions. Any Opinion of
Counsel may be qualified by reference to bankruptcy,
insolvency, reorganization, moratorium and other laws affecting
creditors' rights and similar matters.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified
by, or covered by .the. opinion of, only one such Person, or that
they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of the City may
be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, Counsel,
unless such officer knows, or in the exercise of ordinary care
should know, that the certificate or opinion or representations
with respect to the matters upon which his or her certificate
or opinion is based are erroneous. Any such certificate or
Opinion of Counsel may be based, insofar as it relates to
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factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the City stating
that the information with respect to such factual matters is in
the possession of the City, unless such Counsel knows, or in
the exercise of ordinary care should know, that the certificate
or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Agreement,
they may, but need not, be consolidated and form one instrument.
Section 1.5. Exhibits. Attached to and by reference
made a part of this Agreement are the following exhibits:
Exhibit A: Form of Supplemental Opinion of Bond
Counsel
Exhibit B: Metes and Bounds Description of the
Site
Exhibit C: Title Exceptions
Section 1.6. Benefits of Agreement. Nothing in this
Agreement, expressed or implied, is intended or shall be
construed to confer upon any person other than the City, the
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Manager, and the owners from time to time of the Instruments,
any right, remedy, or claim, legal or equitable, under or by
reason of this Agreement or any provision hereof, this
Agreement and all its provisions being intended to be and being
for the sole and exclusive benefit of the City, the Manager,
and the owners from time to time of the Instruments.
Section 1.7. Inconsistent Provisions. All ordinances,
orders or resolutions, or parts thereof, which are in direct
conflict or inconsistent with any provision of this Agreement
are hereby repealed to the extent of such conflict and the
provisions of this Agreement shall be and remain controlling as
to the matters contained herein• provided, however, that to the
extent of any conflict between the provisions of this Agreement
and the Ordinances, the provisions of the Ordinances shall
control. The parties agree that no provision of the Ordinances
or the Instruments shall ever be construed as impairing the
obligation of this contract it being expressly agreed that the
provisions of this Agreement shall be subject and subordinate
in all respects to the provisions of the Ordinances and the
Instruments.
Section 1.8. Governing Law. This Agreement shall be
construed and enforced in accordance with the laws of the State
of Texas and the United States of America.
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Section 1.9. Incorporation of Recitals of the Parties.
The recitals of the parties contained in the preamble hereof
are hereby incorporated by reference and made a part of this
Agreement for all purposes as if the same were restated in full
in this Section.
Section 1.10. Notices -Waiver. Wherever this Agreement
provides for notice of any event, such notice shall be shall be
sufficiently given (unless otherwise herein expressly provided)
if in writing and sent by United States Mail, first class
postage prepaid, to the address of the party to receive such
notice specified below at the close of business on the Business
Day next preceding the mailing of such notice.
If to the City at:
City of Lubbock, Texas
Municipal Building
1625 13th Street
Lubbock, Texas 79401
Attention: Assistant City Manager
for Financial Services
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If to the Manager at:
Science Spectrum
5052 50th Street
Lubbock, Texas 79414
Attention: President
Where this Agreement provides for notice in any manner,
such notice may be waived in writing by the party entitled to
receive such notice, either before or after the event with
respect to which such notice is given, and such waiver shall be
the equivalent of such notice.
Section 1.11. Construction of Terms. If appropriate in
the context of this Agreement, words of the singular number
shall be considered to include the plural, words of the plural
number shall be considered to include the singular, and words
of the masculine, feminine or neuter gender shall be considered
to include the other genders. The parties acknowledge that the
parties and their counsel have reviewed and revised this
Agreement and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of
this Agreement or any exhibits or amendments hereto.
Section 1.12. Public Meeting. It is officially found,
determined, and declared by the City that the meeting at which
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this Agreement is approved by the City 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 Agreement, was given, all as required by Article 6252-17,
Vernon's Texas Civil Statutes, as amended.
Section 1.13. Effective Date. This Agreement shall
take effect and be in full force upon its execution and
delivery by the parties hereto.
Section 1.14. Term of Agreement. The term of this
Agreement shall be the period of time from the latest date
shown as the date either the City or the Manager executed this
Agreement until the date which is the date the final payment
from the City to the Manager is due pursuant to Section 3.4(a)
hereof, unless sooner terminated as provided in this
Agreement. This Agreement shall terminate automatically, and
without the requirement of any action by the parties, upon
notification by the Internal Revenue Service to the Manager
that it is no longer an organization described in Section
501(c)(3) of the Code.
Section 1.15. Waivers and Amendments. Except with
respect to waivers referred to in Article Four which may occur
as provided in Article Four, any provision of this Agreement
may be waived if, but only if, such waiver is in writing and
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signed by the City and the Manager. Any provision of this
Agreement may be amended by any provision of the Ordinances and
otherwise if, but only if, such amendment is in. writing and is
signed by the City and the Manager. No waiver or amendment
shall be effective if such waiver or amendment would have a
material adverse effect on the rights of the owners from time
to time of the Instruments.
Section 1.16. Successors and Assigns. The provisions
of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted
successors and assigns. The Manager agrees that it will not
assign this Agreement or take or permit the taking of any
action which would result in a successor to the Manager without
the prior written consent of the City, which consent may be
withheld in the City's sole and absolute discretion.
Section 1.17. Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute
one and the same instrument.
Section 1.18. Table of Contents; Article Titles;
Captions. The Table of Contents, Article Titles, and Section
Captions in this Agreement are inserted for convenience of
reference only and in no way define, describe, limit, or expand
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the scope or intent of this Agreement or any of the provisions
hereof.
Section 1.19.. Entire Agreement. This Agreement
contains the entire agreement between the parties relating to
the transactions contemplated hereby on its Effective Date.
All prior or contemporaneous agreements, understandings,
representations or statements, oral or written, are superseded
hereby. It is expressly provided that amendments to this
Agreement may be made by the Ordinances.
Section 1.20. Partial Invalidity. Any provision of
this Agreement which is unenforceable or invalid or the
inclusion of which would affect the validity, legality, or
enforcement of this Agreement shall be of no effect, but all
the remaining provisions of this Agreement shall remain in full
force and effect.
Section 1.21. Further Assurances. Both the City and
the Manager agree that it will without further consideration
execute and deliver such other documents and take such other
action as may be reasonably requested by the other party to
consummate more effectively the transactions contemplated
hereby.
[END OF ARTICLE ONE]
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ARTICLE TWO
CITY'S INTENDED FINANCING
Section 2.1. City to Issue Obligations. Subject to the
conditions set forth in this Article Two, the City agrees to
borrow the sum of at least Five Million and No/100 Dollars
($5,000,000.00) to acquire the Site and to finance the
construction and equipment of the Exhibition Hall/Auditorium.
Such borrowing is to be evidenced through the issuance of
Certificates of Obligation, the interest on which is excludable
from gross income of the owners thereof for federal income tax
purposes, Contractual Obligations the interest on which may be
includable in gross income of the owners for federal income tax
purposes. All financial obligations of the City pursuant to
this Agreement are conditioned upon, and are in all respects
subject to, the issuance by the City of the Instruments and
upon the Manager fulfilling its obligations pursuant to the
Ordinances and this Agreement. The City shall at all times
prior to the final maturity of the Certificates of Obligation
own all portions of the property financed with the proceeds of
the Certificates of Obligation.
Section 2.2. Authority Retained in City. The City
agrees to provide copies of the Ordinances to the Manager at
least three weeks prior to their adoption in order to allow the
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Manager to review and comment upon the provisions of the
Ordinances. The Manager will be allowed three Business Days
from, but not including, the day it receives the Ordinances to
comment on the Ordinances. The City reserves the right to
unilaterally reject any comment it receives from the Manager.
The City shall notify the Manager of any such unilateral
rejection within three Business Days from, but not including,
the day it receives the Manager's comments. In the event of.
any such unilateral rejection by the City, the Manager may,
within one Business Day from, but not including, the day it
receives the City's notice of rejection, notify the City of its
termination of this Agreement. In the event the Manager
terminates this Agreement under such circumstances, neither
party shall have any further obligation to the other. In the
event the Manager does not terminate this Agreement under such
circumstances, the Manager shall be deemed to have accepted the
provisions of the Ordinances. All details, characteristics,
terms and procedures with respect to the Instruments shall be
and remain solely at the discretion of the City. This
Agreement shall not bind the City in any manner with respect to
the details, characteristics, terms and procedures with respect
to issuance of the Instruments until the Instruments have been
issued, except that the City agrees to use reasonable diligence
in proceeding with the issuance of the Instruments. In the
event the City fails for any reason, whether within its control
or not, to issue the Instruments prior to August 1, 1991, the
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City shall be deemed to have terminated this Agreement for
cause and neither the City nor the Manager shall have any
claim, cause of action, or recourse against the other as a
result of such termination by virtue of the approval,
execution, or delivery of this Agreement.
Section 2.3. Conditions to Issuance of Instruments.
Unless and until each of the following conditions has been
satisfied, or waived by the City at its sole discretion, the
City shall have no obligation under this Agreement to deliver
the Instruments:
(a) No suit, action, investigation or legal or
administrative proceeding shall be seriously threatened or
pending before any court or governmental agency which is likely
to result in the restraint, prohibition or the obtaining of
damages or other relief in connection with the issuance of the
Instruments or the consummation of the transactions
contemplated hereby, or which, in the opinion of the City,
would have a materially adverse effect on the transactions
contemplated hereby.
(b) All steps to be taken and all instruments and
other documents to be executed, and all other legal matters in
connection with the transactions contemplated by this Agreement
shall be reasonably satisfactory in legal form and effect to
Counsel for the City.
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(c) At or prior to the issuance and delivery of the
Instruments, the City shall have received two (2) executed
copies of each of the following documents:
(l) the approving Opinion, dated the Issue
Date, of Fulbright & Jaworski, as bond counsel ("Bond
Counsel"), delivered to the City, relating to, among
other things, the validity of the Instruments, and the
tax-exempt status of the interest on the Certificates of
Obligation for federal income tax purposes;
(2) an Opinion, dated the date of the issuance
and delivery of the Instruments, of Bond Counsel,
addressed to the City containing the information
specified in Exhibit A hereto;
(3) a certificate of the Manager, dated the
Issue Date and signed on its behalf by the President of
its Board of Trustees, in form satisfactory to the City,
to the effect that the representations and warranties of
the Manager herein, or in any certificate or document
delivered by the Manager pursuant to the provisions
hereof, are true and correct on and as of the Issue Date
as though such representations and warranties were made
on and as of the Issue Date, and all agreements or
conditions to be performed or complied with by the
Manager hereunder on or prior to the Issue Date have
been performed or complied with;
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(4) a copy of the resolutions or other
proceedings of the Manager authorizing the execution and
delivery of this Agreement and the transactions
contemplated hereby, in each case certified by the
Secretary of the Board of Trustees of the Manager as
having been duly adopted and being in full force and
effect and as being true, accurate and complete copies
thereof;
(5) an unqualified opinion, dated on or prior
to the Issue Date, of the Attorney General of the State
of Texas, relating to the legality and validity of the
Instruments, and approving the Instruments, as required
by law;
(6) evidence satisfactory to the City that the
Instruments have been registered by the Comptroller of
Public Accounts of the State of Texas as required by law;
(7) a letter from each of the nationally
recognized rating services which now maintain a rating
on the debt of the City indicating a rating for the
Instruments which is not lower than the rating now
assigned by each such rating service, respectively, to
debt of the City;
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(8) a certificate, dated the Issue Date,
executed by the President of the Board of Directors of
the Manager, to the effect that except to the extent
heretofore disclosed to the City, no litigation is
pending or, to the knowledge of such Person, threatened,
in any court to restrain or enjoin the operations or
activities of the Manager, or in any way contesting or
affecting the creation, organization, or tax-exempt
status of the Manager or the validity of this Agreement,
or contesting the powers of the Manager to execute,
deliver, and perform this Agreement;
(9) a certificate, dated the Issue Date, of the
President of the Board of Directors of the Manager, to
the effect that no event affecting the Manager has
occurred since the date of the City's Official Statement
relating to the Instruments which should be disclosed
therein for the purpose for which it is to be used or
which is necessary to be disclosed therein in order to
make the statements and information therein not
misleading in any respect and the information contained
in such Official Statement relating to the Manager and
this Agreement is true, complete, and correct in all
material respects;
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(10) a Certificate Concerning -Tax-Exempt Status
and Related Matters of the Manager, dated the Issue
Date, and signed by the President of the Board of
Directors of the Manager, in the form approved by Bond
Counsel; and
(11) such additional legal opinions,
certificates, proceedings, instruments and other
documents as Bond Counsel may reasonably request to
evidence compliance by the Manager with legal
requirements, the truth and accuracy, as of the Issue
Date, of the representations and warranties of the
Manager contained herein and the due performance or
satisfaction by the Manager at or prior to such time of
all agreements then to be performed and all conditions
then to be satisfied by the Manager.
All such opinions, certificates, letters, agreements and
documents will be in compliance with the provisions hereof only
if they are satisfactory in form and substance to the City and
to Bond Counsel. The City shall be entitled to receive such
conformed copies or photocopies of such opinions, certificates,
letters, agreements and documents as the City may reasonably
request.
[END OF ARTICLE TWO]
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ARTICLE THREE
CREATION OF FUNDS AND ACCOUNTS,
CREDITS THERETO AND PAYMENTS THEREFROM
Section 3.1. Creation of City Funds and Accounts. The
City agrees to create and establish in the Ordinance
authorizing the issuance and delivery of the Certificates of
Obligation an "Exhibition Hall/Auditorium Fund," a
"Construction Fund" and such other Funds and Accounts as the
City, in its sole discretion, shall deem advisable.
Section 3.2. Deposits to Exhibition Hall/Auditorium
Fund. All Gross Revenues shall be deposited, as received by
either the City or the Manager, in the Exhibition
Hall/Auditorium Fund. The provisions of the Ordinance
authorizing the Certificates of Obligation may, in the sole
discretion of the City, establish alternate Funds or Accounts
to which such deposits may be made.
Section 3.3. Deposits to Construction Fund. Proceeds
of the Instruments shall be deposited to separate Accounts
within the Construction Fund and shall be used as specified in
this Agreement and in the Ordinances authorizing the
Certificates of Obligation and Contractual Obligations.
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Section 3.4. Payments from Exhibition Hall/Auditorium
Fund.
(a) From amounts on deposit in the Exhibition
Hall/Auditorium Fund deposited thereto as provided in Section
3.2 of this Agreement, and not otherwise, the City agrees to
pay to the Manager during the Term of this Agreement an amount
equal to Gross Revenues of the Exhibition Hall/Auditorium for
the one-year period commencing with the Opening and ending on
the day prior to the first anniversary of the Opening and,
thereafter, an amount equal to Gross Revenues of the Exhibition
Hall/Auditorium less Two Hundred Thousand and No/100 Dollars
($200,000) per year, until the last Business Day of the month
during which the twenty-first annual anniversary of the Opening
occurs. Payments to the Manager shall be made on the last
Business Day of each month in which a payment is due. The
first monthly payment shall be made on the last Business Day of
the month in which the Opening occurs. The first twelve
monthly payments shall equal the Gross Revenues of the
Exhibition Hall/Auditorium since the date of the prior monthly
payment date (except the first monthly payment which shall
equal the Gross Revenues of the Exhibition Hall/Auditorium
since the Opening). Following the first twelve monthly
payments, the next eleven (11) monthly installments in each
year shall equal the Gross Revenue of the Exhibition
Hall/Auditorium for such month less Sixteen Thousand Six
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Hundred Sixty -Six Dollars and Sixty -Six Cents ($16,666.66) and
the twelfth monthly installment in each year shall equal the
Gross Revenues of the Exhibition Hall/Auditorium for such month
plus any other amount deposited to the Exhibition
Hall/Auditorium Fund during such year remaining after making
the required calculation of the amounts therein to be retained
by the City, less Sixteen Thousand Six Hundred Sixty -Six
Dollars and Seventy -Four Cents ($16,666.74) plus the amount of
any deficiency in the amount to be retained by the City with
respect to all prior monthly payments for any year.
(b) The Manager agrees to use all amounts paid to it
pursuant to this Section 3.4 first for the payment of
Maintenance and Operating Expenses (other than amounts owed to
it for services as the Manager) and second, if there be any
amounts remaining after the payment by the Manager for
Maintenance and Operating Expenses (other than amounts owed to
it for services as the Manager) to pay it for services as
Manager. The Manager agrees to use its fee, for its exempt
purpose within the corporate limits of the City for the direct
benefit of the City and its citizens to accomplish public
purposes of the City.
(c) The amounts to be paid to the Manager pursuant to
this Section 3.4 are payable only to the extent of amount
deposited to the Exhibition Hall/Auditorium Fund as provided in
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Section 3.2 and only to the extent of funds then on deposit,
less any amounts to be retained by the City, on each date on
which a payment is due. The Manager shall have no lien or
encumbrance on Gross Revenues except to the extent required and
allowed by the Act. The amounts to be paid to the Manager
pursuant to this Section 3.4 are to be paid for the benefit of
the City; it being expressly agreed that no such payment shall
be made in a manner which results in a lending of credit of the
City or a gratuitous application of public funds to private use.
Section 3.5. Payments from Construction Fund. (a) In
consideration of the assignment of the Lease to the City and
the acquisition of the interest in the Equipment described
therein, in addition to the amounts otherwise required to be
paid under the Lease, the City agrees to pay to the Manager,
from an Account of the Construction Fund into which the
proceeds of the Contractual Obligations are deposited the
amounts required to be paid by the City as assignee of the
Lease to ISC for the Equipment pursuant to Section 2.1 of the
Lease at such time or times as the City as assignee of the
Lease is obligated to make such payments to ISC pursuant to
Section 2.1 of the Lease. The Manager agrees to pay such
amounts to ISC in compliance with the provisions of Section 2.1
of the Lease. The City shall pay from the Account of the
Construction Fund into which the proceeds of the Contractual
Obligations are deposited, all costs of the issuance of the
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Instruments which cannot be or are not paid from the Account of
the Construction Fund into which the proceeds of the
Certificates of Obligation are deposited.
(b) The City agrees to pay to the Manager, from the
Account of the Construction Fund into which the proceeds of the
Certificates of Obligation are deposited the Purchase Price on
the Closing Date and, against such invoices and supporting
documentation as may be reasonably required by the City,
amounts for the payments of costs of constructing the
Exhibition Hall/Auditorium. The City shall pay from the
Account of the Construction Fund into which the proceeds of the
Certificates of Obligation are deposited, an amount of the
costs of issuance of the Certificates of Obligation which does
not exceed the amount described in Section 147(g) of the Code.
No amount shall be paid from the Account of the Construction
Fund into which the proceeds of the Certificates of Obligation
are deposited to acquire the City's interest in the Equipment.
(c) Any amounts remaining in the Accounts in the
Construction Fund following payment of all costs of issuance
permitted to be paid therefrom, completion of the construction
of the Exhibition Hall/Auditorium and acquisition of the
Equipment shall be deposited as provided in the Ordinances
authorizing issuance of the Instruments.
[END OF ARTICLE THREE]
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ARTICLE FOUR
CONVEYANCE OF PROPERTY
Section 4.1. Agreement to Convey and Accept. In
consideration of their covenants set forth in this Agreement,
the Manager agrees to convey to the City, and the City agrees
to accept the conveyance from the Manager, of the following
described property on the terms and conditions set forth in
this Article Four:
(a) All of the land (the "Site") situated in the City
of Lubbock, the County of Lubbock and the State of Texas,
described on Exhibit B attached hereto and made a part hereof.
(b) All structures, buildings, improvements and
fixtures, if any, located on the Site on the Closing Date
("Improvements"). Improvements are not intended to include any
structures, buildings, improvements, and fixtures to be
constructed by the City after the Closing Date and
specifically, do not include the Exhibition Hall/Auditorium.
(c) All personal property, if any, owned by the
Manager located on or in the Site or Improvements and used in
connection with the operation and maintenance of the Site or
Improvements ("Personal Property").
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(d) All intangible property (including specifically
but without limitations the Manager's rights under the Lease)
owned by the Manager and used in connection with the Site,
Improvements and Personal Property, including all trademarks
and trade names used in connection with any part of the Site
and Improvements, all hereditaments, privileges, tenements and
appurtenances belonging to the Site, all right, title and
interest of the Manager in and to all open or proposed
highways, streets, roads, avenues, alleys, easements, strips,
gores and rights-of-way in, on, across, in front of, contiguous
to, abutting or adjoining the Site, and all licenses, permits
and warranties now in effect with respect to the Site,
Improvements and Personal Property ("Intangible Property"), all
of which shall be transferred to City pursuant to an assignment
in a form acceptable to the City and Furnished by the Manager
("Assignment of Intangible Property").
The Site, Improvements, Personal Property, and
Intangible Property are sometimes collectively referred to in
this Article Four as "Premises".
Section 4.2. Closing. (a) The consummation of the
conveyance of the Premises ("Closing") shall take place at the
City Hall of the City, on a date (the "Closing Date") mutually
agreed upon by the parties, but not later than the earlier of:
(i) thirty (30) days after termination of the Due Diligence
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Period as described in Section 4.3 of this Agreement; or (ii)
sixty (60) days after the Issue Date, unless such date is
extended by written agreement signed by the parties. The
Closing Date shall be on or after the Issue Date and prior to
commencement of construction of the Exhibition Hall/Auditorium.
(b) At Closing, the Manager shall deliver the following
documents: (i) A General Warranty Deed in recordable form
properly executed on behalf of the Manager, conveying to the
City the Site and Improvements in fee simple, subject only to
the Permitted Exceptions; (ii) A Bill of Sale in a form
acceptable to the City and furnished by the Manager executed by
the Manager, conveying to the City the Personal Property; (iii)
An affidavit sworn by an officer of the Manager to the effect
that the Manager is not a "foreign person" which affidavit
shall be in a form acceptable to the City and furnished by the
Manager, or in such other form as may be prescribed by federal
regulations; and (iv) A duly executed Assignment of Intangible
Property as described in section 4.1(d) of this Agreement
assigning and conveying to the City the Intangible Property;
(c) At Closing, the City shall deliver to the Manager
the Purchase Price for the Site and such evidence as the
Manager's Counsel may reasonably require as to the authority of
the person or persons executing documents on behalf of the City.
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Section 4.3. Conditions to Closing. In addition to all
other conditions to the completion of the transaction described
in this Agreement, the Manager and the City agree that the
closing of this sale and purchase is subject to satisfaction,
approval or waiver by the City of the following conditions on
or before 5:00 p.m., Lubbock, Texas time, within thirty (30)
days after the Issue Date ("Due Diligence Period"):
(a) inspection and approval of the physical condition
and use of the Premises, including without limitation, the
-:availability for access, utility services, zoning,
environmental risks, engineering and soil conditions. For the
purpose of conducting physical inspections, the Manager agrees
to provide the City and its authorized agents reasonable access
to the Premises at all reasonable times during the Due
Diligence Period upon at least forty-eight (48) hours prior
written notice to the Manager. The City shall provide the
Manager with written notice of any objectionable physical
conditions on or relating to the Premises, which the City will
require be corrected prior to Closing.
(b) Inspection and approval of such documents
relating to the Premises as the City may request, all of which
shall be made available to the City at the offices of the
Manager at reasonable times for inspection and copying by the
City at the City's expense.
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In the event any of the conditions set forth in this
Section 4.3 are not satisfied or waived by the City within the
Due Diligence Period, the City shall notify the Manager in
writing of termination of this Agreement ("City's Termination
Notice") prior to the expiration of the Due Diligence Period.
Upon receipt of the City's Termination Notice, both the Manager
and the City shall be released and discharged from all further
obligations under this Agreement, and neither the Manager nor
the City shall be subject to any claim by the other for damages
of any kind. If no City's Termination Notice has been served
upon the Manager within the time provided in this Section 4.3,
all conditions shall be deemed to have been satisfied or waived
and the City's obligations to close shall be firm with respect
to the conditions of this Section 4.3.
Section 4.4. Evidence of Title. As evidence of the
Manager's title, the Manager shall deliver to the City:
(a) Title Commitment. As soon as practicable after
the execution of this Agreement by the Manager but before the
Issue Date, at the Manager's expense, a title commitment for an
owner's policy of title insurance, on the standard form
promulgated by the Texas State Board of Insurance, issued by a
title company acceptable to the City in the amount of the price
paid by the Manager to acquire the Premises showing good and
indefeasible title to the Premises in the Manager's name
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subject only to (i) the title exceptions described on Exhibit C
attached hereto and made a part hereof, and (ii) liens and
encumbrances arising from and after the date of approval of
this Agreement by the City of a definite or ascertainable
amount which can be removed at Closing (collectively "Permitted
Exceptions"). If the commitment discloses exceptions other
than the Permitted Exceptions, the City, within fifteen (15)
Business Days following the date on which the City received the
commitment, shall deliver to the Manager written notice of the
City's objections, if any, to such exceptions ("Unpermitted
Exceptions"). If the City ;fails- -to °deliver such written notice
or objection to the Manager within such fifteen (15) Business
Day period, the City shall be deemed to have waived its right
to object to such Unpermitted Exceptions, which shall
thereafter be deemed Permitted Exceptions. In the event that
the City shall so object to any such Unpermitted Exceptions,
the Manager shall notify the City within five (5) Business Days
following the date of the City's notice of such objections that
the Unpermitted Exceptions have been, or will be at or prior to
Closing, removed from the commitment or are or will be insured
around by the title company pursuant to an endorsement to the
title policy. In such event, if reasonably required to allow
the parties to prepare for closing, the Closing Date shall be
deferred to a date mutually agreed upon by the parties, but not
later than December 31, 1991.
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(b) Survey. As soon as practicable after the
execution of this Agreement by the Manager, at the Manager's
expense, a survey of the Site and Improvements, prepared and
certified to have been made in accordance with ALTA/ACSM
standards on or after the execution of this Agreement by the
Manager by a registered land surveyor. The City agrees to
reimburse the Manager for the expense of the survey on the
Closing Date after the Closing has occurred. If the survey
shows any material encroachments over a building, set -back or
property line, a prohibited encroachment of a material nature
:over, - -any easement or any other matter which does or could in
the future materially interfere with the use, operation or
financing of the Site and Improvements or render title thereto
unmarketable and which are not Permitted Exceptions
(collectively "Survey Defects"), the City, within fifteen (15)
Business Days of the date it receives the survey, may deliver
to the Manager written notice of those Survey Defects to which
it objects, or the City will be deemed to have waived any right
to such objection. The Manager shall have fifteen (15)
Business Days ("Survey Cure Period") from the date of receipt
of the City's notice of objections, if any, to cure the Survey
Defects. If the Manager fails to do so, the City shall, within
ten (10) days after the end of the Survey Cure Period, elect
either to terminate this Agreement by delivering written notice
thereof to the Manager within said ten-day period, or be deemed
to have accepted the Premises as is. If the City fails to
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deliver such notice of termination within the time provided,
(i) the City shall be deemed to have agreed to accept the
Premises as is, and (ii) this Agreement shall remain in full
force and effect. All Survey Defects (1) to which the City
makes no objection within the time provided in this paragraph,
or (2) which the Manager does not cure within the Survey Cure
Period, and provided the City does not terminate this Agreement
as permitted herein, will, in either case, thenceforth be
deemed Permitted Exceptions.
Section.. 4.5. Representations- ' and , Warranties,, The
Manager represents and warrants that as of the date of its
execution of this Agreement and as of the Closing Date:
(a) the Manager has received no notice from any
governmental authority of any pending or threatened (i)
zoning, building, fire, or health code violations or violations
of other governmental requirements or regulations with respect
to the Premises that have not previously been corrected, or
(ii) any condemnation of the Premises. The Manager further
warrants and represents that in the event it receives any such
notice prior to the Closing Date, it will provide to the City
copies of any such notice. The Manager agrees to correct any
matters disclosed in such notice. If any such matter cannot be
corrected by the Manager by Closing, the Manager agrees to pay
to the City at Closing the amount estimated to be required to
correct such matter.
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(b) That as of the date hereof, there are no leases
or other agreements for occupancy in effect with respect to the
Premises.
(c) That the Manager has received no notices .from
insurers of defects in the Improvements which have not been
corrected.
(d) That there are no legal actions pending or
threatened against the Premises nor are there any violations of
any building codes , or other statutes affec.tin.g. . the - .use,
occupancy and enjoyment of the Premises.
(e) That the representations and warranties contained
in this section shall survive the Closing.
Section 4.6. The Manager's Covenants. Between the date
of the execution of this Agreement and the Closing, the Manager
shall:
(a) Maintain the Premises in its present condition,
ordinary wear and tear excepted; and
(b) Maintain all casualty, liability and hazard
insurance currently in force with respect to the Premises.
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Section 4.7. Prorations. The following adjustments to
the Purchase Price paid hereunder shall be made between the
Manager and the City and shall be prorated (as applicable) on a
per diem basis as if the City owned the Premises for the entire
day on the Closing Date: All real estate taxes and
installments of special assessments due and payable in the
calendar year of Closing. All other installments of special
assessments not yet due and payable shall be paid by, or the
responsibility of, the City.
ge-ction 4.8. Title Charges. -The Cit°y shall- pay the
cost of recording the instruments of conveyance. If the
transaction is terminated by either party on account of default
by the other, the defaulting party shall pay all escrow costs
billed by the title company. In the event this transaction
shall close as provided in this Agreement, closing costs shall
be paid by the City. Each party shall pay its own attorneys'
fees except as otherwise provided in this Agreement.
Section 4.9. Risk of Loss. The Manager shall bear all
risk of loss with respect to the Premises up to the Closing
Date. Notwithstanding the foregoing, in the event of damage to
the Premises by fire or other casualty prior to the Closing
Date, the Manager shall repair and restore the Premises. The
Manager shall promptly notify the City in writing of any such
fire or other casualty.
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Section 4.10. Condemnation. In the event between the
date of this Agreement and the Closing Date, any condemnation
or eminent domain proceedings are initiated (by any
governmental entity other than the the City) which might result
in the taking of any part of the Improvements to the Site or
the taking or closing of any right of access to the Premises,
the City may:
(a) terminate this Agreement by written notice to the
Manager; or
(b) proceed with the Closing, in which event the
Manager shall assign to the City all of the Manager's right,
title and interest in and to any award made in connection with
such condemnation or eminent domain proceedings.
The Manager shall immediately notify the City in writing
of the commencement or occurrence of any condemnation or
eminent domain proceedings. If such proceedings would result
in the taking of any Improvements to the Site or the taking or
closing of any right of access to the Premises, the City shall
then notify the Manager, within ten (10) days of the City's
receipt of the Manager's notice, whether the City elects to
exercise its rights under subparagraph (a) or subparagraph (b)
of this Section 4.10. Closing shall be delayed, if necessary,
until the City makes such election.
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Section 4.11. Default by the Manager. If this
transaction is not consummated by reason of a default by the
Manager hereunder, the City shall have the right to: (a)
declare this, Agreement terminated, and (b) recover money
damages from the Manager, but such money damages shall be
limited to actual out-of-pocket expenses incurred by the City
and shall not include consequential damages.
Section 4.12. Time of Essence. Time is of the essence
with respect to the transactions contemplated by Article Two
this Agreement.
Section 4.13. Further Assurances. Both the Manager and
the City agree that they will without further consideration
execute and deliver such other documents and take such other
action, whether prior or subsequent to Closing, as may be
reasonably requested by the other party to consummate more
effectively the transactions contemplated hereby.
[END OF ARTICLE FOUR]
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ARTICLE FIVE
MANAGEMENT AGREEMENT
Section 5.1. Retention of Services. The primary goal
of this Article is to secure for the City the expertise and
services necessary to operate the Exhibition Hall/Auditorium at
a level consistent with the community in which the Exhibition
Hall/Auditorium is to be located and with economic efficiency
consistent with such level (the "Primary Goal"). The City
hereby retains the Manager to manage and supervise construction
of the Exhibition Hall/Auditorium and to supervise, operate and
manage the Exhibition Hall/Auditorium in the name, for the
account, and on behalf of the City, pursuant and subject to the
terms and conditions set forth in this Article, and the Manager
hereby accepts such retention and agrees to render such
services as are hereinafter set forth. The compensation to be
paid to the Manager for its services as Manager under this
Agreement shall be paid solely from the source and only to the
extent provided in Section 3.4. Subject to the foregoing, the
City agrees to pay the Manager the Gross Revenues, less amounts
to be retained by the City pursuant to Section 3.4, less
Maintenance and Operating Expenses.
Section 5.2. Manager's Authority. Subject to the
City's authority set forth in Section 5.3 of this Article, the
Manager shall have the full responsibility to supervise,
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operate and manage the day-to-day operations of the Exhibition
Hall/Auditorium in accordance with the Budget and Written
Policies and Procedures of the Exhibition Hall/Auditorium as
established from time to time by the City and to perform the
specific functions set out in this Article without the prior
consultation or approval of the City, except, that prior
specific authorization of the City must be obtained for any
action by the Manager on the following:
(a) Commitment of the City for capital expenditures
not included in the Budget of the Exhibition Hall/Auditorium;
(b) Execution of or otherwise binding of the City to
any contract or lease;
(c) Disposition of any asset of the City; and
(d) Execution of any contract or agreement with any
third party with respect to the Premises or the Exhibition
Hall/Auditorium.
Section 5.3. Control Retained in the City. The
governing body of the City shall retain all authority placed in
it by law which is non -delegable and shall retain such other
authority as shall not have been specifically delegated by it
to the Manager pursuant to the terms of the Article or
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otherwise. No provision of this Article or this Agreement is
intended to delegate, or shall be construed as delegating, any
non -delegable right or power of the City. To the extent of any
conflict or inconsistency between the provisions of any other
Section of this Agreement and this Section 5.3., the provisions
of the Section 5.3 shall control and the provisions in conflict
with or inconsistent with this Section 5.3 shall be of no force
or effect.
Section 5.4. Relationship of the Parties. The
Manager's appointment and actions hereunder are in the status
of an independent contractor to the City. In furtherance
thereof, the City and the Manager acknowledge and agree that
one is neither the employee, employer, principal, nor agent of
the other. Nothing contained in this Agreement shall
constitute or be construed to be or to create a partnership or
joint venture between the City and the Manager with respect to
the Exhibition Hall/Auditorium or any equity interest in the
Exhibition Hall/Auditorium on the part of the Manager. The
Manager and its Affiliate shall have the right to render
similar services for other Persons, whether or not engaged in
the same business, and may enter into such other business
activities as the Manager and its Affiliate, in their sole
discretion, may determine, including, but not limited.to, other
transactions with the City that are beyond the scope of this
Agreement.
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Section 5.5. Management of the Exhibition
Hall/Auditorium. Consistent with all materially applicable
federal, state and local laws, the Manager shall perform those
functions reasonably required to manage the operations of the
Exhibition Hall/Auditorium in accordance with accepted
management techniques and the reasonable exercise of its
judgment. Without limiting the generality of the foregoing the
Manager shall be responsible for the performance of the
following duties during the Term of this Agreement:
(a) subject to the approval of the City and in
compliance with procurement laws applicable to the City,
engagement of an architect and arranging for architectural and
engineering services for the construction of the Exhibition
Hall/Auditorium;
(b) entering into all appropriate lease and service
agreements with ISC, or such other provider of equipment for
the operation of the Exhibition Hall/Auditorium as may be
selected by the Manager; provided, however, that the Manager
must obtain the City's prior written approval of all lease and
service agreements with ISC or any other Person;
(c) subject to the approval of the City and in
compliance with procurement laws applicable to the City,
selection, supervision, and payment of all contractors engaged
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to provide labor, materials, and equipment in connection with
the construction of the Exhibition Hall/Auditorium;
(d) provision of all personnel reasonably necessary
to supervise and direct the completion of the construction of
the Exhibition Hall/Auditorium;
(e) entering into all necessary agreements for
exhibitions to be displayed within the Exhibition
Hall/Auditorium;
(f) operation and management of the Exhibition
Hall/Auditorium following its completion and provision of all
personnel, labor, and material reasonably necessary to properly
operate the Exhibition Hall/Auditorium; and
(g) from amounts paid to it by the City, the Manager
shall timely pay all Maintenance and Operating Expenses.
Section 5.6. Employees. The Manager shall be
responsible for hiring, promotion, discharge and supervision of
all employees performing services in and about the Exhibition
Hall/Auditorium. Such employees shall be in the employ of the
Manager and, as such, the Manager shall be solely liable to
such employees for their wages, compensation, and "employee
benefits," if any ("employee benefits" being defined as an
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employer's contribution to F.I.C.A., unemployment compensation,
and other employment taxes, pension plan contribution, worker's
compensation, group life and accident and health insurance
premiums, retirement, disability and other similar benefits
applicable to such employees), all of which shall be set and
determined solely by the Manager.
Section 5.7 Administrator. The Manager shall provide
a full-time administrator of the Exhibition Hall/Auditorium to
oversee the day-to-day management thereof. The administrator
shall be the employee of the Manager, but shall at all times be
acceptable to the City.
Section 5.8. Inside Consultants. The Manager shall
provide such consultants who are employees of the Manager as it
deems necessary to achieve the Primary Goal, except for
consultation services in connection with extraordinary matters
which are not covered by this Agreement. (Such "extraordinary
matters" being defined as any matter deemed by the Manager, in
its sole discretion, to involve such extraordinary time and
expense as to warrant prior approval thereof by the City before
undertaking to provide any services in connection therewith.)
Section 5.9. Outside Consultants. The Manager shall
recommend to, and if approved by the City, use its best efforts
to engage, on behalf of the City and at the City's sole
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expense, such consultants who are not employees of the Manager
as it deems necessary to achieve the Primary Goal.
Section 5.10. Recommendations Concerning Operations. At
least annually, the Manager shall consult with and make
recommendations to the City concerning the operations of the
Exhibition Hall/Auditorium.
Section 5.11. Legal Compliance. The Manager shall
comply with all applicable federal, state and local rules,
regulations, statutes, laws and ordinances governing the
operations of the Exhibition Hall/Auditorium.
Section 5.12. Insurance. The Manager shall arrange for
and obtain, at the City's expense and subject to the approval
of the City to the extent not described in Written Policies and
Procedures, insurance with respect to the Exhibition
Hall/Auditorium of such kinds, in such form and amounts, and
with such company or companies, all to the extent available and
as the City shall deem adequate and desirable, and in
accordance with any agreement of the City relating to the
Exhibition Hall/Auditorium. The City and the Manager shall be
named as coinsureds or additional insureds, to the extent their
interests appear on all such insurance maintained with respect
to the Exhibition Hall/Auditorium. If the Manager shall
arrange for and obtain such insurance, it may provide all or
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part of said insurance in the form of one or more blanket
policies applying to it or to its Affiliates, with the
applicable prorated expense thereof being applied to the
Exhibition Hall/Auditorium.
Section 5.13. Rate and Fee Schedule. The Manager shall
determine the fee schedules for all services and rates charged
by the Exhibition Hall/Auditorium; provided, however, that
rates and charges for the Exhibition Hall/Auditorium shall be
approved by the City, in consultation with, and based upon
recommendations of, the Manager. Such fees and rates shall be
in compliance with the requirements of Section 3(c) of the Act,
shall be consistent with the financial viability of the
Exhibition Hall/Auditorium and shall be consistent with fees
and rates prevailing from time to time in the community.
Section 5.14. Preparation and Adoption of Construction
Budge and Annual Budget. The Manager shall prepare a detailed
construction budget with respect to the construction of the
Exhibition Hall/Auditorium and shall cause such construction
budget to be presented to the City prior to awarding any
contract for the construction of the Exhibition
Hall/Auditorium. The construction budget shall be based upon
bids received by the Manager in compliance with applicable
procurement law pertaining to the City. Upon adoption of the
construction budget by the City, the Manager shall be
authorized to commence, or cause to be commenced, construction
of the Exhibition Hall/Auditorium for the City.
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The Manager shall prepare an annual detailed Budget for
the Exhibition Hall/Auditorium setting forth, in part, major
operating objectives, anticipated revenue, expenses, cash flow
and capital expenditures and shall cause such Budget to be
presented to the City not later than thirty (30) days prior to
the commencement of each Fiscal Year of the City for its
acceptance, rejection, or modification by the City. Upon
adoption or any modification of such Budget by the City, it
shall serve as a guide for the operation of the Exhibition
Hall/Auditorium during the ensuing year. If a Budget is
disapproved upon its submission, then the last month of the
prior year's Budget shall be used as a guideline for operating
the Exhibition Hall/Auditorium until a new Budget therefor is
approved by the City. In the event that the City disapproves
any Budget, such disapproval shall specify those items which
are disapproved, and the Manager shall resubmit an altered
Budget to the City within ten (10) days following such
disapproval.
Section 5.15. Accounting Records. The Manager shall
maintain or cause to be maintained, in accordance with
Generally Accepted Accounting Principals, the accounting
records of the Exhibition Hall/Auditorium and shall cause to be
delivered to the City, within thirty (30) days after the close
of each Fiscal Year, a balance sheet and a related statement of
revenue and expenses showing the results of the operations of
the Exhibition Hall/Auditorium during such Fiscal Year.
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Section 5.16. Manager's Covenants Regarding Maintenance
of Tax -Exempt Status of Certificates of Obligation.
A. General. The Manager shall not take any action
or omit to take any action which, if taken or omitted,
respectively, would adversely affect the excludability of
interest on any Certificate of Obligation from the gross
income, as defined in section 61 of the Code, of the owner
thereof for federal income tax purposes. The Manager and the
City shall execute such amendments hereof and supplements
hereto (and shall comply with the provisions thereof) as may,
in the Opinion of Counsel, be necessary to preserve or perfect
such exclusion. The Manager shall comply with each specific
covenant in this Section at all times prior to the last
maturity of the Certificates of Obligation, unless and until
there shall have been delivered to the Manager and the City an
Opinion of Counsel to the effect that failure to comply with
such covenant, either generally or to the extent stated
therein, shall not adversely affect the excludability of
interest on any Certificate of Obligation from the gross
income, as defined in section 61 of the Code, of the owner
thereof for federal income tax purposes, and thereafter such
covenant shall no longer be binding upon the Manager, generally
or to such extent as the case may be, anything in any other
Subsection of this Section to the contrary notwithstanding.
All defined terms used in this Section 5.16 not otherwise
defined in this Agreement shall have the meaning set forth in
the Regulations.
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B. Warranty of Representations. All representations,
warranties, and certifications made by the Manager in
connection with the delivery of the Certificates of Obligation
on the Issue Date, including, but not limited to, those
representations, warranties, and certifications contained in
any Certificate Concerning Tax -Exempt Status and Related
Matters executed by the Manager, are and shall be true,
correct, and complete in all material respects.
C. Tax -Exempt Status of the Manager. The Manager
represents and warrants that:
(1) its purposes, character, activities, and
methods of operation have not changed materially since
its organization and are not materially different from
the purposes, character, activities, and methods of
operation at the time of its determination by the
Internal Revenue Service to be an organization described
in section 501(c)(3) of the Code;
(2) it has not diverted a substantial part of
its corpus or income for a purpose or purposes other
than the purpose or purposes for which it is organized
or operated;
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(3) it has not operated in a manner that would
result in it being classified as an "action"
organization within the meaning of Section
1.501(c)(3)-1(c)(3) of the Regulations, including, but
not limited to, promoting or attempting to influence
legislation by propaganda or otherwise as a substantial
part of its activities;
(4) none of its directors, officers, or
incorporators, or any person or entity controlled by it,
or any other person or entity having a personal or
private interest in its activities has acquired or
received, directly or indirectly, any of its income or
assets, in any form, other than as reported or to be
reported to the Internal Revenue Service for its
appropriate fiscal year;
(5) it has not received any indication or
notice whatsoever to the effect that its exemption from
federal income taxation under section 501(a) of the Code
has been revoked or modified, or that the Internal
Revenue Service is considering revoking or modifying
such exemption, and such exemption is still in full
force and effect;
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(6) it has timely filed with the Internal
Revenue Service all requests for determination, reports,
and returns required to be filed by it, and such
requests for determination, reports, and returns have
not omitted or misstated any material fact;
(7) it has not devoted more than an
insubstantial part of its activities in furtherance of a
purpose other than an exempt purpose within the meaning
of section 501(c)(3) of the Code; and
(8) it has not taken any action, nor knows of
any action that any other Person has taken, nor knows of
the existence of any condition, which would cause it to
lose its exemption from federal income taxation under
section 501(a) of the Code or cause interest on the
Certificates of Obligation to be includable in the
income of the recipients thereof for federal income tax
purposes.
D. Maintenance of Tax -Exempt Status of the Manager.
The Manager shall be organized and shall conduct its operations
in such a manner so as to qualify as an organization described
in section 501(c)(3) of the Code.
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E. Limited Non -Exempt Use or Loan of Proceeds. The
Manager shall not use (or permit the use of) any proceeds of
the Certificates of Obligation, or any income from the
investment thereof or any property financed with such proceeds
or income in any trade or business carried on by any person or
entity which is not an Exempt Person or in any unrelated trade
or business, as defined in section 513(a) of the Code, of an
Exempt Person or permit the direct or indirect loan of any such
proceeds, income, or property to any person or entity other
than an Exempt Person or to any person or entity which is an
Exempt Person for use in an unrelated trade or business, as
defined in section 513(a) of the Code, if the amount of such
proceeds, income, or property so used or loaned or portions
thereof so used in the aggregate, when added to the costs of
issuance financed directly or indirectly with Certificates of
Obligation proceeds, exceeds 5% of the proceeds of the
Certi:fidalfes Of Obligation,.'.,,F-or purposes, of Ah•is, Subsect°ion,
property is considered to be "used" by a Person if:
(1) it is sold or otherwise disposed of, or
leased, to such person or entity;
(2) it is operated, managed, or otherwise
physically employed, utilized, or consumed by such
person or entity, excluding operation or management
pursuant to an agreement which meets the guidelines set
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forth in Revenue Procedure 82-14, 1982-1 C.B. 459 or
82-15, 1982-1 C.B. 460, including any amendments or
revisions thereto;
(3) capacity in or output or service from such
property is reserved or committed to such person or
entity under a take -or -pay, output, incentive payment,
or similar contract or arrangement;
(4) such property is used to provide service to
(or such service is committed to or reserved for) such
person or entity on a basis or terms which are different
from the basis or terms on which such service is
provided (or committed or reserved) to members of the
public generally; or
(5) substantial benefits and burdens of
ownership of such property are otherwise effectively
transferred to such person or entity,
but the investment of amounts held for the credit of any fund
or account established under the Ordinance authorizing the
issuance of the Certificates of Obligation in accordance with
the applicable provisions thereof shall not constitute "use" of
property or a "loan" of proceeds. For purposes of this
Subsection, proceeds are considered to be "loaned" to a person
if:
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(a) property financed with proceeds of the
Certificates of Obligation or any income from the investment
thereof is sold or leased to such person or entity in a
transaction which creates a debt for federal income tax
purposes;
(b) capacity in or service from such property is
committed to such person or entity under a take -or -pay, output,
or similar contract or arrangement; or
(c) indirect benefits, or burdens and benefits of
ownership, of such property are otherwise transferred to such
person or entity in a transaction which is the economic
equivalent of a loan,
and the amount of any such "loan" is the cost of such property
financed with proceeds or investment-income°af the Certificates
of Obligation.
F. Ceiling on Aggregate Amount of Bonds. The
Manager shall not take, omit to take, or suffer to occur any
action which, if taken, omitted, or suffered, respectively,
would cause the aggregate authorized face amount of all
previously issued and outstanding obligations (a) the interest
on which is excludable from the gross income, as defined in
section 61 of the Code, of the owners thereof for federal
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income tax purposes pursuant to section 103 of the Code or any
predecessor provisions and (b) which is or shall become
allocated, pursuant to section 145(b)(2) of the Code, (i) to
the Manager or (ii) to any other Person who is or shall become
an owner or a principal user of the project financed with the
Certificates of Obligation within the meaning of
section 144(a)(3) of the. Code, during the three-year period
beginning on the later of the Issue Date or the date such
project is first placed in service, when added to the initial
principal amount of the Certificates of Obligation, to exceed
$150,000,000.
G. Prohibition on Certain Uses. The Manager shall
not use or permit the use of any proceeds of the Certificates
of Obligation or any income from the investment thereof
(1) Prohibited Facilities: to provide any
airplane, skybox, or other private luxury box, any
facility primarily used for gambling, or any store the
principal business of which is the sale of alcoholic
beverages for consumption off premises, or
(2) Costs of Issuance: to pay or otherwise
finance costs of issuance of the Certificates of
Obligation (e.g., underwriting compensation, trustee and
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rating agency fees, printing costs, City fees, and fees
and expenses of counsel) in an amount which exceeds 2%
of the proceeds of the Certificates of Obligation.
H. Not to Cause Classification as Arbitrage Bonds.
The Manager shall not take any action or omit to take any
action with respect to the Gross Proceeds of the Certificates
of Obligation or of any amounts expected to be used to pay the
principal thereof or the interest thereon which, if taken or
omitted, respectively, would cause any Certificates of.
Obligation to be classified as an "arbitrage bond" within the
meaning of section 148 of the Code.
I. Not to Create Gross Proceeds. The Manager shall
not pledge or otherwise encumber, or permit the pledge or
encumbrance of, any money, investment, or investment property
as security for payment of the Certificates of Obligation, and
shall not establish any segregated reserve or similar fund for
such purpose unless in the Opinion of Counsel such action will
not adversely affect the excludability of interest on any
Certificates of Obligation from the gross income, as defined in
section 61 of the Code, of the owner thereof for federal income
tax purposes.
J. No Federal Guarantees. Except to the extent
permitted by section 149(b) of the Code and the regulations and
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rulings thereunder, the Manager shall not take or omit to take
any action which would cause the Certificates of Obligation to
be "federally guaranteed" within the meaning of section 149(b)
of the Code and the regulations and rulings thereunder.
Section 5.17. Ownership in City. The City shall own
all assets, tangible and intangible, which are purchased in
connection with the Exhibition Hall/Auditorium, including any
leasehold rights acquired by the Manager under its contracts
with ISC and all additions and accessions to such property
during the term of this Agreement. To the extent property and
leasehold rights are acquired by the Manager in connection with
the Exhibition Hall/Auditorium in its name, such property and
leasehold rights shall be held by it as trustee for the benefit
of the City, subject to the provisions of this Agreement.
[END OF ARTICLE FIVE]
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ARTICLE SIX
DEFAULTS AND REMEDIES
Section 6.1. Events of Default. If any of the
following events occur, it is hereby defined as and declared to
be and to constitute an Event of Default, whatever the reason
therefor and whether voluntary or involuntary or effected by
operation of law:
(A) default in the performance of any of the
Manager's obligations with respect to the transmittal of moneys
to be credited to the Exhibition Hall/Auditorium Fund under the
provisions hereof and such default shall have continued for a
period of four (4) days; or
(B) default in the performance or observance of any
other of the covenants, agreements or conditions on the part of
the Manager contained in this Agreement, and such default shall
have continued for a period of ninety (90) days after written
notice thereof, specifying such default, shall have been given
by the City to the Manager; or
(C) if the Manager shall
(1) admit in writing its inability to pay its
debts generally as they become due; or
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(2) consent to the appointment of a custodian
(as that term is defined in the federal Bankruptcy Code)
for or assignment to a custodian of the whole or any
substantial part of the Manager's property, or fail to
stay, set aside or vacate within ninety (90) days from
the date of entry thereof any order or decree entered by
a court of competent jurisdiction ordering such
appointment or assignment; or
(3) commence any proceeding or file a petition
under the provisions of the federal Bankruptcy Code for
liquidation, reorganization or adjustment of debts, or
under any insolvency law or other statute or law
providing for the modification or adjustment of the
rights of creditors or fail to stay, set aside or vacate
within ninety (90) days from the date of entry thereof
any order or decree entered by a court of competent
jurisdiction pursuant to an involuntary proceeding,
whether under federal or state law, providing for
liquidation or reorganization of the Manager or
modification or adjustment of the rights of creditors.
The determination of whether an Event of Default has
occurred and is continuing shall be made by the City. The
Manager agrees that it shall have no right to challenge or
question any such determination and agrees to be bound by any
such determination.
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Section 6.2. Remedies. If an Event of Default has
occurred and is continuing, the City may pursue any available
remedy by suit at law or in equity to enforce the covenants of
the Manager herein, including, without limitation, any remedy
of a secured party under the Texas Uniform Commercial Code,
foreclosure and mandamus, and may pursue such appropriate
judicial proceedings as the City shall deem most effective to
protect and enforce, or aid in the protection and enforcement
of, the covenants and agreements herein. If an Event of
Default has occurred and is continuing, the City may by notice
in writing to the Manager, declare this Agreement terminated,
and in such event, the Manager shall be considered to be a
Tenant -at -Will, and in addition to all other rights and
remedies available to the City under applicable law, the City
shall have all rights and remedies of a landlord under the law
of the State of Texas. The City shall be entitled to immediate
possession of the Exhibition Hall/Auditorium, and it may remove
the Manager and its employees and property, if any, therefrom
without being deemed guilty of any manner of trespass.
No remedy by the terms of this Agreement conferred upon
or reserved to the City is intended to be exclusive of any
other remedy, but each and every such remedy shall be
cumulative and shall be in addition to any other remedy given
to the City hereunder or now or hereafter existing at law or in
equity or by statute. The assertion or employment of any right
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or remedy hereunder shall not prevent the concurrent assertion
or employment of any other appropriate right or remedy.
No delay or omission to exercise any right or power
accruing upon any Event of Default shall impair any such right
or power or shall be construed to be a waiver of any such Event
of 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 by the City.
No waiver of any default or Event of Default hereunder
shall extend to or shall affect any subsequent default or Event
of Default or shall impair any rights or remedies consequent
thereon.
Section 6.3. Waiver of Stay or Extension Laws. To the
extent that such rights may lawfully be waived, neither the
Manager nor anyone claiming through it or under it shall or
will set up, claim, or seek to take advantage of any stay or
extension laws now or hereafter in force, which may affect the
covenants or agreements contained in this Agreement and the
Manager, for itself and all who may claim through or under it,
hereby waives, to the extent that it lawfully may do so, the
benefit of all such laws.
Section 6.4. Undertaking for Costs. The Manager and
the City agree that any court may in its discretion, in any
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suit by or on behalf of the City for the enforcement of any
right or remedy under this Agreement, assess reasonable costs,
including reasonable attorneys fees, against the Manager in
such suit, having due regard to the merits and good faith of
the claims or defenses made by the Manager.
Section 6.5. Termination of Proceedings. In case the
City shall have proceeded to enforce any right under this
Agreement and such proceedings shall have been discontinued or
abandoned for any reason, or shall have been determined
adversely to the City, then and in every such case the Manager
and the City shall, subject to any determination in such
proceedings, be restored to their former positions and rights
hereunder with respect to this Agreement, and all rights,
remedies and powers of the City shall continue as if no such
proceedings had been taken.
[END OF ARTICLE SIX]
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ARTICLE SEVEN
PURCHASE OPTION
Section 7.1. Conditional Agreement of Purchase and
Sale. Subject in all respects to applicable law regarding
disposition of City property, and to the extent they may
legally so agree, the parties agree that the Manager shall have
an option to purchase the Site and Exhibition Hall/Auditorium
and all other assets and property rights specifically related
to and used or useful in connection with the Exhibition
Hall/Auditorium on any date on the following terms and subject
to the following conditions:
(a) The outstanding Certificates of Obligation shall
at the time of such purchase be scheduled to mature or be
subject to redemption at par plus accrued interest to the date
of redemption with .nine (9)•,months,,from the date of such
purchase and sale;
(b) The Manager shall have delivered notice, in
writing, of its intent to exercise such option not less than
seventy-five (75) days prior to the proposed date of purchase
and sale (which date shall be set forth in such notice);
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(c) Following receipt of the Manager's notice
referred to in (b) above, the City shall have, if required to
do so at the time by applicable law, given notice to the
general public of the offer of the land for sale by publishing,
on two separate dates, with such sale to occur at least after
the fourteenth (14th) day after the date of the second
publication, in a newspaper of general circulation in Lubbock
County, Texas, with such publication to include a description
of the land, including its location, and the procedure by which
sealed bids to purchase the land may be submitted, or the City
shall have otherwise complied with then -applicable law (the
intent of this Section 7.01(c) being to require compliance with
Section 272.001(a) of the Local Government Code as in effect on
the Effective Date of this Agreement);
(d) The Manager shall have complied fully with the
applicable bidding requirements and shall have submitted the
highest and best bid received by the City;
e The Manager's bid shall be equal to or greater
than the greater of (1) the outstanding principal amount of the
Instruments, (2) the fair market value of the property, or (3)
the depreciated value of the property calculated on a cost
basis of the principal amount of Instruments issued by the
City, amortized over a 20 -year useful life utilizing the
straight line depreciation method, commencing on the Effective
Date of this Agreement; and
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(f) The Manager shall, at the time of such purchase
and sale, be in full compliance with all covenants,
representations, and obligations under this Agreement, the
Ordinance authorizing the Certificates of Obligation, and any
other document or certificate executed by the Manager in
connection with the issuance of the Certificates of Obligation.
Section 7.2. Preservation of Status of Property. In
order to preserve the status of the property to be purchased
and sold as described above, to avoid adverse tax consequences
to the owners from time to time of the Certificates of
Obligation, and to accomplish the public purpose for which the
Certificates of Obligation are issued, the City agrees that it
will not sell the property to any purchaser unless:
(a) The prospective purchaser is an organization
described in Section 501(c)(3) of the Code and has demonstrated
to the City's satisfaction that were it the Manager on the date
of such purchase and sale, the condition specified in Section
7.01(f) of this Agreement would be satisfied.
(b) The prospective purchaser has agreed in a
covenant running with the land to operate and maintain the
property as an Exhibition Hall/Auditorium in the same or
similar manner as the property has been operated and maintained
while owned by the City for at least five (5) complete years
from the date of suchpurchase and sale; and
-69-
5926E:
(c) The City has obtained an unqualified approving
opinion of Counsel nationally recognized in the field of
municipal bond law that such purchase and sale will not affect
the status of the interest paid or to be paid on the
Certificates of Obligation under federal income tax law.
Section 7.3. Proceeds of Sale. Proceeds from the sale
of the property shall be deposited in the interest and sinking
fund for the Certificates of Obligation.
[END OF ARTICLE SEVEN]
-70-
5 9 2 5 k.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized
officers as of the dates indicated below.
EXECUTED by the City this
(City Seale
ATTEST:
28th day of February, 1991
CITY OF LUBBOCK
By:
Mayor
EXECUTED by the Manager this 28th day of February, 1991.
SCIENCE SPECTRUM
President,
Board of Directors
-71-
5 9 2 6 E
EXHIBIT A
FORM OF SUPPLEMENTAL OPINION OF BOND COUNSEL MENTIONED ON
PAGE TWELVE OF CONTRACT.
APPROVED: t.._/MA)OR, CITY OF LUBBOCK
APPROVED: PRESIDENT,. BOARD OF DIRECTORS OF SCIENCE
SPECTRUM
FULBRINHT & .JAWORSKl
2200 Ross AVENuF_
SUITE 2a00
QALL-AS,TEXAS 75201
TZ.[�.+0'+t[:2i4/6b5.800C
PACSiM1LE: 2ic/&&8.9200
May 23, 1991
City of Lubbock, Texas
1525 13th Street
Lubbock, Texas 79401
NO{,3TON
WASMINGTON, C,C.
AUr.TIN
SAN ANTONIO
DALLAS
NSW YORK
LOB ANGELES
LONDON
ZURMH
HONG KONG
RE: $4,030,000 City of Lubbock, Texas, Combination Tax and
Exhibition Hall/Auditorium (Limited Pledge) Revenue.
Certificates of Cblioatian, Series 1991
----------------------------------------------
Ladies and Gentlemen:
In reference to the original issuance and sale of the
above described certificates of obligations (the
"Certificates") by the City of Lubbock, Texas (the "City"), we
served as Bond Counsel for the City. In our capacity as Bond
Counsel for the City, we prepared the ordinance (the
"Ordinance") authorizing the issuance of the Certificates,
adopted by the City Council of the City on April 24 and April
25, 1991, which also approved and authorized the distribution
of the Official Statement, dated April 1, 1991 (tile "Official
Statement") relating to the Certificates. -
Insofar as the Official. Statement is concerned, our
review and examination was limited to the information contained
therein under the caption "Bond and Certificate Information
(other than the sub -section. "Book -Entry -Only System")" and the
sun, -caption "Tax Exe�ption", and save and except for the
foregoing captions, we have rct undertaken -to determine
independently the accuracy,. completeness, or fairness of any
other information, data, or descriptions Contained in the
Official Statement, including particularly, but not limited to,
the financial and statistical data included therein,
0
Based upon and subject to the above and foregoing, and
our examination of such other information and documents,
including provisions of the Constituticn and applica"le State
of Texas and federal laws as we believe necessary to enable us
to render this opinion, we are of the opinion that under
applicable State of Texas and federal laws:
A. The information in the Official Statement relating
to the Certificates and the Ordinance contained under the
captions of the Official Statement describing such documents
presents a fair and accurate summary of the provisions of the
laws and instruments therein described.
B. The Certificates are exempted securities within the
meaning of Section 3(a)(2) of the Securities Act of 1933, as
amended, and it is not necessary in connection with the sale of
the Certificates to the public to register the Certificates
under the Securities Act of 1933, as amended, or to quality the
Ordinance under the Trust Indenture Act of 1939, as.amended.
C. In the performance of our duties as Bond Counsel for
the City, and our limited participation in the reviaw of the
Official Statement as noted above, no facts came to our
attention which would lead us to believe that, as of this date,
the Official Statement (except for the financial data and
statistical data and forecasts included therein and the
Appendices thereto to which no view is expressed) contains any
untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to
make the statements therein, in the light or the circumstances
under which they were made, not misleading.
This opinion is solely for your benefit in connection
with the referenced transaction and may net be relied on by,
nor copies delivered to, any other person, or used For any
other purpose, without our prior written consent.
6 2 3 7 E
Very truly yours,
EXHIBITS B AND C
ATTACHED COPY. OF TITLE COMMITMENT SHALL SERVE FOR THE LIMITED PURPOSE OF SERVING AS EXHIBITS
B AND C TO THE CONTRACT (SAID EXHIBITS B AND C BEING MENTIONED (N PAGE TWELVE OF THE CONTRACT)
SUCH LIMITED PURPOSE BEING TO SHOW THE LEGAL DESCRIPTION OF THE LAND TO BE CONVEYED WHICH
CONSTITUTES EXHIBIT B AND THE TITLE EXCEPTIONS WHICH CONSTITUTES EXHIBIT C'. ALL OTHER
PROVISIONS OF THE ATTACHED TITLE COMMITMENT (OTHER THAN THE LEGAL DESCRIPTION OF THE LAND
TO BE CONVEYED AND THE TITLE EXCEPTIONS) SHALL HAVE NO APPLICATION TO THIS CONTRACT INSOFAR
AS SERVING AS EXHIBITS B AND C HERETO IS CONCERNED.
APPROVED. ./�e1/� ,MAYOR, CITY OF LUBBOCK
APPROVED: , PRESIDENT, BOARD OF DIRECTORS OF SCIENCE
SPECTRUM
BG28151.3
%..VIVIIVII I IVICIV 1 IVV. uu LO.L.,J.LJ _•
:If�3 50,000.00. 4>t�
2/19/91 19/9 1_
3 3 5
Lauryers Title Insurance Corporation
National Headquarters - Richmond, Virginia
COMMITMENT FOR TITLE INSURANCE
...w- SCHEDULE A
ebrua
icies or Policy to be issued �
Form T-1.,,.OWNER POLICY OF TITLE INSURAN
Proposed Insured CITY OF LUBBOCK
Form T-2- _'MORTGAGEE POLICY OF TITLE INSURANCE
Proposed Insured.
a'c w% rya
Proposed
Borrower
Form T-13: ',MORTGAGEE TITLE POLICY BINDER ON IN
Proposed Insured:
9;
IM CONSTRUCTION LOAN
a s xa < a z T b
(d) OTHER art _♦t ¢ s x 4 a r rr
�''
#r F'� Proposed Insured -
'A
2' The `estate or interest in the Land described or referred to to this Commttment and covered
easement etc tdenUfy or describe! b z`F
d _ �rtir[�df x y� ,ri x' �`�- ✓,.7�. i , '�P h ��F i,L ,a92x a, z .
6
,Fee
to at the effective date hereof appears to be vested in
ECTRUM, a Texas Non-profit corporate
EXHIBIT "B
<,
f
99 1130
No
50,000.0
he land referred to to this Commitment is described as follows. ,r 3�r �� 4r a„
� � "�
iot Three -E (3-E),;TIME'S SQUARE Addition to the City"of Lubbock,'hubbock"
;ounty, Texas, according to the Map, Plat, and/or Dedication Deed thereof
ecorded in.Volume 1566,.`Page 343, Deed Records of Lubbock County, Texas,'
lescribed by metes and bounds as follows:.a
iEGINNING at point which is the Northwest corner 'Of Lot 3-E,r"TIME'Sg"SQUARE
Adition'to the City of Lubbock, `Lubbock County,'Texas, same point being
:he Northeast corner of Lot 5-13, TIME'S SQUARE Addition and in the South
tight -of -Wad line of Loop 289, ,
'HENCE N_.89 57' E, along the South Right -of -Way line of said Loop 289 a'
listance of 185.00 feet to 'a point `of curvature to the right;
'HENCE Southeasterly, around a curve to the right,"said curve having a
-adiusof-15 00 feet, "a central angle of 90% tangent lengths of 15.00* Y
'CONTINUED ON FOLLOWING PAGE ° ' t :yamsrtF
a " ' LUBBOCK _ ABSTRACT & ,TITLE COMPANY
=S p l• 2j .i '�"
"'l' Y x S A a Ko.. �# � '+r� y `2 I` `}'�,5'�� L Y �''.
}
Lubbock,^
Texas
.
Countersigned at
Authorized Off icer or A nt
B6181513
", Commitment No
-< � x. � -�
�� . � �
.� .k ,• � - :
commitment is invalid unless Schedule A—Page 1
Farm No. 42-31 (Seh AI-
- the insuring provisions and Sched-�
035-t -031-�200i4 t itho
in U-S.A
ules A, B, and C are attached.
ZONTINUED FROM SCHEDULE At BG281513
,feet, ''a chord distance of 21 .21 feet to al point in the West Right -of Way
i%
,;line of Canton Avenue;
q:
;.THENCE S 0°.03' E, along the West Right -of -Way' line Fof said Canton' Avenue,
`a distance" of 406.35 feet to a point of curvature;
THENCE Southwesterly, around a'curve to the right, said curve having a
-,_.radius of 1.5.00,feet, a central angle of „90°,.tangent lengths of 15.00
{f;feet, a'chord distance of 21.21 feet „to a point in the North Right-of-Way-
,:,T,,,,-line `line of :74th Street;
;THENCE S 89.°57' W, along the North Right -of -Way line-''o'f said 74th'8treet
'ta distance'of 185.00 feet to a point which is the Southwest corner of said
Lot 3-E, same being the Southeast-:z6or"ner-_,,of said Lot 5-B;
`THENCE N 0'03' W, along the East�'line af=raid Lot 5 B, a distance of
436.35,feet to the PLACE OF 'BEGINNINGi3,,j!
r } ,3f
r-
�i
4 -
y
ORIGINA
jawyers7itle
jnsurance
Gorv,%^ration�3
ZONTINUED FROM SCHEDULE At BG281513
,feet, ''a chord distance of 21 .21 feet to al point in the West Right -of Way
i%
,;line of Canton Avenue;
q:
;.THENCE S 0°.03' E, along the West Right -of -Way' line Fof said Canton' Avenue,
`a distance" of 406.35 feet to a point of curvature;
THENCE Southwesterly, around a'curve to the right, said curve having a
-,_.radius of 1.5.00,feet, a central angle of „90°,.tangent lengths of 15.00
{f;feet, a'chord distance of 21.21 feet „to a point in the North Right-of-Way-
,:,T,,,,-line `line of :74th Street;
;THENCE S 89.°57' W, along the North Right -of -Way line-''o'f said 74th'8treet
'ta distance'of 185.00 feet to a point which is the Southwest corner of said
Lot 3-E, same being the Southeast-:z6or"ner-_,,of said Lot 5-B;
`THENCE N 0'03' W, along the East�'line af=raid Lot 5 B, a distance of
436.35,feet to the PLACE OF 'BEGINNINGi3,,j!
r } ,3f
r-
�i
4 -
y
ORIGINA
1. (INSERT HERE ALL OTHER SPECIFIC EXCEPTIONS AS TO SUPERIOR LIENS, EASEMENTS, OUTSTANDING MINERAL AND r'
ROYALTY INTERESTS.
,2U') Underground Utility Easement across south end of wenty toot
subject property as shown on Plat with Dedication Deed recorded in Volume
'1566, Page 343, Deed Records,'Lubbock County, Texas.
B. An undivided 1/2 interest in all of the oil, gas and other minerals in,
on and under the 'insured premises heretofore reserved in instrument
recorded in Volume 228, Page.457, Deed Records of Lubbock County, Texas.
C. An undivided ,1/4th interest in all of the oil, gas and other minerals
in, on and under the insured premises heretofore convey'ad in instrument u '
recorded in Volume 296, Page 35, Deed Records of Lubbock County, Texas.
No .further search of the oil, gas and mineral interest has been made.
See requirement on Schedule C,, Item
ONTINUEDY ON FOLLOWING PAGE
"
Th
rs commitment is invalid unless r
the insur►ng provrsions and Sched-
ules A, B, and Care attached.
Forin No 42 31 {$rh, E+,i
Commitment No BG281 51 3
/_i
Lawyers Title jnsurance` Cor ration
k National Headquarters — Richmond Virginia
SCHEDULE B
policy or policies licies d will also contain the following exclusions and exceptions:
Schedule B of the poli to be issue
IKI
The policy will be subject to the Conditions and Stipulations thereof, the terms and conditions of the instrument creating the
estate insured, if any, shown in Schedule A and to the following matters which will be additional exceptions from the
rage of thepolicy:
i The following restrictive covenants of record itemized below, but in any Mortgagee Policy of Title Insurance or Mortgagee Title
Policy Binder on Interim Construction Loan, the Company will guarantee that any such restrictive covenants have not been violated
so as to affect and that a future violation thereof will not affect the validity or priority of the insured mortgage (insert specific
recording data or state )Delete this exception
tri s y ,rya `h•; w a ,, ,,
The survey Aexception will be amended "except as to ' "shortages in area" upon
.�
2 An discre anci , conflicts or sh rta es in area or bou da lines or en a h t , any overlapping of improvements
purvey Ping a ai4n€ri 1191 P�.
.
re�eipg o a current jus�1
3 Standby fees and taxes for the year 19 91 and subsequent years, and subsequent assessments for prior years due to change in
n land usage or ownership. not yet due and ,payable* E;
w'4. Usor claims o::
u ry f usury. (Mortgagee Policy or Mortgagee Title Policy Binder on Interim Construction Loan only)
5. Any right of recission contained in any CONSUMER CREDIT PROTECTION or TRUTH -IN -LENDING laws. (Mortgagee Policy or
Mortgagee Title Policy on Interim Construction Loan only.)
IF
6. No materials have been furnished or any labor performed in connection with the construction contemplated hereunder prior
to the execution, acknowledgment and delivery of the lien instrument described under SCHEDULE A hereof, if the land
.` described under SCHEDULE A forms any part of the homestead of the owner. (May be deleted if satisfactory evidence is
furnished before binder is issued.) (Mortgagee Title Policy Binder on Interim Construction Loan only.)
7 The following lien(s) and all terms, provisions and conditions of the'instrument(s) creating or evidencing said liens)
-. _
1. (INSERT HERE ALL OTHER SPECIFIC EXCEPTIONS AS TO SUPERIOR LIENS, EASEMENTS, OUTSTANDING MINERAL AND r'
ROYALTY INTERESTS.
,2U') Underground Utility Easement across south end of wenty toot
subject property as shown on Plat with Dedication Deed recorded in Volume
'1566, Page 343, Deed Records,'Lubbock County, Texas.
B. An undivided 1/2 interest in all of the oil, gas and other minerals in,
on and under the 'insured premises heretofore reserved in instrument
recorded in Volume 228, Page.457, Deed Records of Lubbock County, Texas.
C. An undivided ,1/4th interest in all of the oil, gas and other minerals
in, on and under the insured premises heretofore convey'ad in instrument u '
recorded in Volume 296, Page 35, Deed Records of Lubbock County, Texas.
No .further search of the oil, gas and mineral interest has been made.
See requirement on Schedule C,, Item
ONTINUEDY ON FOLLOWING PAGE
"
Th
rs commitment is invalid unless r
the insur►ng provrsions and Sched-
ules A, B, and Care attached.
Forin No 42 31 {$rh, E+,i
Commitment No BG281 51 3
/_i
ORIGINAL
- )rm No. 4231 (Sch. C)
No Text
No Text
FULBRIGHT & JAWORSKI
2200 ROSS AVENUE
SUITE 2800
DALLAS,TEXAS 75201
TELEPH ONE: 214/855-8000
TELECO PI ER: 214/855-8200
February 25, 1991
VIA FEDERAL EXPRESS
Mr. Robert Massengale
City of Lubbock
1625 13th Street
Lubbock, Texas 79457
R3ss4
HOUSTON
WASHINGTON, D.C.
AUSTIN
SAN ANTONIO
DALLAS
NEW YORK
LOS ANGELES
LONDON
ZURICH
HONG KONG
RE: Land Acquisition and Management Agreement between the City
of Lubbock, Texas, and Science Spectrum
--------------------------------------------
Dear Robert:
Enclosed please find two clean copies of the Land
Acquisition and Management Agreement.
Please advise me of the time of the council meeting on the
28th in order that I may make appropriate travel arrangements.,
Very truly yours,
-111e-u- i
Mark S. Westergard
MSW: lc
Enclosures
0 0 0 1 E- 7 7
LAND ACQUISITION AND
MANAGEMENT AGREEMENT
between
The City of Lubbock, Texas
and
Science Spectrum
Dated as of February 28, 1991
5 9 2 8 E- 1
TABLE OF CONTENTS
RECITALS . . . . . . . . . . . . . . .
ARTICLE ONE
DEFINITIONS AND GENERAL PROVISIONS
Section 1.1.
Section 1.2.
Section 1.3.
Section 1.4.
Section 1.5.
Section 1.6.
Section 1.7.
Section 1.8.
Section 1.9.
Section 1.10.
Section 1.11.
Section 1.12.
Section 1.13.
Section 1.14.
Section 1.15.
Section 1.16.
Section 1.17.
Section 1.18.
Section 1.19.
Section 1.20.
Section 1.21.
Section 2.1.
Section 2.2.
Section 2.3.
Definitions . . . . . . . . . . . . . .
Definitions of General Terms . . . . . .
Computations . . . . . . . . . . . . . .
Certificates and Opinions . . . . . . .
Exhibits . . . . . . . . . . . . . . .
Benefits of Agreement . . . . . . . . .
Inconsistent Provisions . . . . . . . .
GoverningLaw . . . . . . . . . . .
Incorporation of Recitals of the Parties
Notices -Waivers . . . . . . . . . .
Construction of Terms . . . . . . . . .
Public Meeting . . . . . . . . .
Effective Date . . . . . . .
Term of Agreement . . . . . . . . . .
Waivers and Amendments . . . . . . . . .
Successors and Assigns . . . . . . . . .
Counterparts . . . . . . . . . . . . .
Table of Contents; Article Titles;
Captions . . . . . . . . . . . . . .
Entire Agreement . . . . . . . . . . . .
Partial Invalidity . . . . . . . . . . .
Further Assurances . . . . . . . . . . .
ARTICLE TWO
CITY'S INTENDED FINANCING
City to Issue Obligations . . . . . . .
Authority Retained in City . . . . . . .
Conditions to Issuance of Obligations .
ARTICLE THREE
CREATION OF FUNDS AND ACCOUNTS;
CREDITS THERETO AND PAYMENTS THEREFROM
Section
3.1.
Creation
of City Funds and Accounts
Section
3.2.
Deposits
to Exhibition Hall/
Auditorium Fund . . . . . . . . . . .
Section
3.3.
Deposits
to Construction Fund . . . . .
Section
3.4.
Payments
from Exhibition Hall/
Auditorium Fund . . . . . . . . . . .
Section
3.5.
Payments
from Construction Fund . . . .
-i-
5 9 2 8 E- 2
Page
1
3
9
10
11
12
12
13
13
14
14
15
15
16
16
16
17
17
17
18
18
18
19
19
21
IF:
27
29
ARTICLE FOUR
CONVEYANCE OF PROPERTY
Section
4.1.
Agreement to Convey and Accept . . .
. . 31
Section
4.2.
Closing . . . . . . . . . . . . . .
. 32
Section
4.3.
Conditions to Closing . . . . _ . .
. . 34
Section
4.4.
Evidence of Title . . . . . . . .
. . 35
Section
4.5.
Representations and Warranties . . .
. . 38
Section
4.6.
The Manager's Covenants . . . .
. . 39
Section
4.7.
Prorations . . . . . . . . . . .
. . 40
Section
4.8.
Title Charges . . . . . . . . . . .
. 40
Section
4.9.
Risk of Loss . . . . . . . . . . . .
. . 40
Section
4.10.
Condemnation . . . . . . . . . . . .
. . 41
Section
4.11.
Default by the Manager . . . . . .
. . 42
Section
4.12.
Time of Essence . . . . . . . . . .
. . 42
Section
4.13.
Further Assurances . . . . . . . . .
. . 42
Section 5.1.
Section 5.2.
Section 5.3.
Section 5.4.
Section 5.5.
Section 5.6.
Section 5.7.
Section 5.8.
Section 5.9 -.-
Section 5.10.
Section 5.11.
Section 5.12.
Section 5.13.
Section 5.14.
Section 5.15.
Section 5.16.
Section 5.17.
ARTICLE FIVE
MANAGEMENT AGREEMENT
Retention of Services . . . . . . . . .
43
Manager's Authority . . . . . . . . .
43
Control Retained in the City . . . . . .
44
Relationship of the Parties . . . . . .
45
Management of the Exhibition Hall/
6.3.
Auditorium . . . . . . . . . . . .
46
Employees. . . . . . . . . . . . . . .
47
Administrator . . . . . . . . . . . . .
48
Inside Consultants . . . . . . . . . . .
48
Outside Consultants . . . . . . . . . .
48
Recommendations Concerning Operations
49
Legal Compliance . . . . . . . . . . . .
49
Insurance . . . . . . . . . . .
49
Rate and Fee Schedule . . . . . . . . .
50
Preparation and Adoption of Annual
Budget. . . . . . . . . . . . . . . .
50
Accounting Records . . . . . . . . .
51
Manager's Covenants Regarding Maintenance
of Tax -Exempt Status of Certificates of
Obligation . . . . . . . . . . . . . .
52
Ownership in City . . . . . . . . . . .
61
ARTICLE SIX
DEFAULTS AND REMEDIES
Section
6.1.
Events of Default . . . . . . . . . .
. 62
Section
6.2.
Remedies . . . . . . . . . . . . . .
. 64
Section
6.3.
Waiver of Stay or Extension Laws . . .
. 65
Section
6.4.
Undertaking for Costs . . . . . . . .
. 65
Section
6.5.
Termination of Proceedings . . . . . .
. 66
-ii-
5 9 2 8 E- 3
ARTICLE SEVEN
PURCHASE OPTION
Section 7.1. Conditional Agreement of Purchase and
Sale. . . . . . . . . . . . . .. . 67
Section 7.2. Preservation of Status of Property 69
Section 7.3. Proceeds of Sale . . . . . . . . . . 70
SIGNATURE PAGE
-iii -
5 9 2 8 E- 4
71
This Land Acquisition and Management Agreement (the
"Agreement") is made and entered into as of the 28th day of
February, 1991 by and between the City of Lubbock, Texas (the
"City"), a home -rule city of the State of Texas duly organized
and existing pursuant to its charter and the laws of the State
of Texas, and Science Spectrum (the "Manager"), a non-profit
corporation organized under the laws of the State of Texas and
qualified as a tax exempt organization under Section 501(a) of
the Internal Revenue Code as an organization described in
Section 501(c)(3) of the Internal Revenue Code; for the
following purposes and considerations, to -wit:
RECITALS OF THE PARTIES
WHEREAS, the Manager has been actively engaged in the
development and promotion of educational and scientific
demonstrations and exhibits in the City, and
WHEREAS, IMAX Systems Corporation ("ISC") of Toronto,
Ontario, Canada, is one of the world's leading designers,
manufacturers, and producers of audiovisual equipment used in
the production of exhibitions for cultural, scientific, and
educational purposes, and
WHEREAS, ISC has provided the necessary audiovisual
equipment for the establishment of exhibition halls/auditoriums
in a number of locations in the United States and such
exhibition halls/auditoriums have demonstrated their value in
advancing the cultural, educational, and scientific development
of the communities in which they are located, and
WHEREAS, the Manager has entered into arrangements with
ISC for the delivery of a system suitable for the operation of
an exibition hall/auditorium in the City, to be used for
presentation of cultural, scientific, and educational programs,
which arrangement includes the lease of necessary audiovisual
equipment which is subject to patent and trademark rights owned
by ISC, and
WHEREAS, the City, for the benefit of all the citizens
of the City, desires to provide, pursuant to statutory
authority in Tex. Rev. Civ. Stat. Ann. art. 1269j-4.1 (Vernon
Supp. 1991), an exhibition hall/auditorium for cultural,
educational, and scientific programs and to contract with the
Manager in the acquisition of certain land and the management
of an exhibition hall/auditorium utilizing audiovisual
equipment of the type provided by ISC, and
WHEREAS, the City and the Manager desire to enter into
this Agreement for the purpose of evidencing their respective
agreements and intentions concerning such project:
-2-
5 9 2 6 E
NOW, THEREFORE, in consideration of the premises and the
mutual, covenants and agreements herein set forth, the parties
hereto agree as follows:
ARTICLE ONE
DEFINITIONS AND GENERAL PROVISIONS
Section 1.1. Definitions. In this Agreement the
following terms have the following respective meanings unless
the context hereof clearly requires otherwise:
"Account" means any of the accounts referred to herein
or created or affirmed by an Ordinance.
"Act"
means
Tex. Rev.
Civ.
Stat.
Ann. art
1269]-4.1
(Vernon Supp.
1991)
as now in
effect
or as
hereafter
amended.
"Affiliate" ,of any specified Person means any other
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified
Person. For purposes of this definition, "control" when used
with respect to any specified Person means the power to direct
the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities
or the power to appoint and remove its directors, by contract,
-3-
5 9 2 6 E
or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agreement" means this Land Acquisition and Management
Agreement as originally executed or as amended from time to
time by the parties.
"Bond Counsel" means any attorney or firm of attornies
of nationally recognized standing in the field of municipal
bond law.
"Budget" means the annual budget for the operation and
maintenance of the Exhibition Hall/Auditorium.
"Business Day" means any day other than (1) a Saturday
or a Sunday, (2) a legal holiday or the equivalent on which
banking institutions generally are authorized or requested to
close in the City, or (3) a day of which the New York Stock
Exchange is closed.
"Certificate Concerning Tax -Exempt Status and Related
Matters" means a certificate, in form and substance
satisfactory to Bond Counsel, to be executed by an authorized
officer of the Manager as of the Issue Date, relating to such
matters as Bond Counsel may deem necessary in order to opine
regarding the status of the interest on the Certificates under
federal income tax law.
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"Certificates of Obligation means the combination tax
and limited exhibition hall/auditorium revenue certificates of
obligation of the City issued for the purpose of financing the
construction and improvement of the exhibition/hall auditorium
and the acquisition of the Site.
"City" means the City of Lubbock, Texas.
"Closing" has the meaning given in Section 4.2.(a).
"Closing Date" has the meaning given in Section 4.2.(a).
"Code" means the Internal Revenue Code of 1986, as
amended and in force and effect on the Issue Date.
"Contractual Obligations" means the general obligation
contractual obligations of the City issued for the purpose of
financing acquisition of an interest in the Equipment.
"Counsel" means an attorney or attornies selected by the
Person such Counsel represents and qualified to perform the
services required of such Counsel under this Agreement.
"Effective Date" means the date specified in Section
1.13.
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"Equipment" means the personal property leased by ISC to
the Manager pursuant to the Lease.
"Event of Default" means the occurrence of any event
specified as an Event of Default in Section 6.1.
"Exempt Person" means any organization described in
Section 501(c)(3) of the Code and exempt from tax under Section
501(a) of the Code, the District of Columbia, any state of the
United States, any possession of the United States, and any
political subdivision of any such State or possession if such
political subdivision has more than an insubstantial amount of
any of the power to tax, the power of eminent domain, or the
police power.
"Exhibition Hall/Auditorium" means the public building
of the City owned and operated pursuant to authority granted in
the Act, located on the Site, and the construction and
improvement of which is financed by the Certificates.
"Fiscal Year" means the twelve-month accounting period
of the Person with respect to which such term is used.
"Fund" means any of the funds referred to in this
Agreement or created or affirmed by an Ordinance.
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"Gross Revenues" means all receipts, revenues, and
moneys of every kind paid or payable to the City as a result or
consequence of owning the Site, Exhibition Hall/Auditorium, or
an interest in the Equipment (other than restricted grants or
gifts and proceeds of instruments).
"ISC" means IMAX Systems Corporation of Toronto,
Ontario, Canada.
"Instruments" means the Certificates and the Contractual
Obligations, collectively.
"Issue Date" means, as to the Instruments, the date of
the authentication and delivery of the initial obligations of
the Instruments in exchange for the purchase price therefor.
"Lease" means the System Lease Agreement between the
Manager and ISC.
"Maintenance and Operating Expenses" means the expenses
of operation and maintenance of the Site, the Exhibition
Hall/Auditorium, and the Equipment, including, without
limitation, all salaries, management fees, labor, materials,
interest, repairs and additions necessary to render efficient
service, and all payments required to be made to ISC under the
Lease.
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"Manager" means Science Spectrum.
"Net Revenues" means Gross Revenues less Maintenance and
Operating Expenses.
"Official Statement" means any disclosure document or
combination of documents prepared in connection with the
offering and issuance of the Instruments.
"Opening" means the date upon which the Exhibition
Hall/Auditorium is ready for use as certified in writing by the
Manager to the City.
"Opinion of Counsel" means a written opinion of Counsel.
"Ordinance" means the written document or documents in
the form finally approved and adopted by the City Council of
the City authorizing the issuance of the Certificates or the
Contractual Obligations.
"Person" means any individual, corporation, partnership,
joint venture, association, joint-stock company, trust,
unincorporated organization, or government or any agency or
political subdivision thereof.
"Primary Goal" has the meaning given in Section 5.1.
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"Purchase Price" means $ 650,000.00 , being the total
amount to be paid by the City to the Manager at Closing on the
Closing Date for the acquisition of the Site, exclusive of all
Costs of Closing.
"Regulations" means the applicable proposed, temporary,
or final Income Tax Regulations promulgated under the Code, as
such regulations may be amended or supplemented from time to
time.
"Site" has the meaning given in Section 4.1.(a).
"Statutes" means the statutory authority for the
authorization and issuance of the Instruments.
"Term" has the meaning given in Section 1.14.
"Written Policies and Procedures" means written
directions, orders, or guidelines of the City relating to the
operation and management of the Exhibition Hall/Auditorium and
Equipment as in effect from time to time and delivered to the
Manager.
Section 1.2. Definitions of General Terms. Unless the
context shall clearly indicate otherwise, or may otherwise
require, in this Agreement the terms "herein", "hereunder",
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"hereby", "hereto", "hereof" and any similar terms refer
to this Agreement as a whole and not to any particular article,
section or subdivision hereof.
Unless the context shall clearly indicate otherwise, or
may otherwise require, in this Agreement: (i) references to
articles, sections and other subdivisions, whether by number or
letter or otherwise, are to the respective or corresponding
articles, sections or subdivisions of this Agreement as such
articles, sections or subdivisions may be amended from time to
time; (ii) references to articles, chapters, subchapters and
sections of the Statutes, or to any public law or other statute
of the United States or any section thereof, are to the
respective or corresponding articles, chapters, subchapters,
sections and statutes as they may be amended from time to time;
(iii) the word "heretofore" means before the date of
execution of this Agreement, the word "now" means at the date
of execution of this Agreement, and the word "hereafter"
means after the date of execution of this Agreement.
Section 1.3. Computations. Unless the person making
the computation has actual knowledge that facts shall then be
otherwise, all computations required for the purposes of this
Agreement shall be made on the assumption that: (i) the
principal of and interest on the Instruments shall be paid as
and when the same become due; and (ii) all credits required by
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this Agreement to be made to any Fund or Account shall be made
in the amounts and at the times required.
Section 1.4. Certificates and Opinions. Any Opinion of
Counsel may be qualified by reference to bankruptcy,
insolvency, reorganization, moratorium and other laws affecting
creditors' rights and similar matters.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that
they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of the City may
be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, Counsel,
unless such officer knows, or in the exercise of ordinary care
should know, that the certificate or opinion or representations
with respect to the matters upon which his or her certificate
or opinion is based are erroneous. Any such certificate or
Opinion of Counsel may be based, insofar as it relates to
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factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the City stating
that the information with respect to such factual matters is in
the possession of the City, unless such Counsel knows, or in
the exercise of ordinary care should know, that the certificate
or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Agreement,
they may, but need not, be consolidated and form one instrument.
Section 1.5. Exhibits. Attached to and by reference
made a part of this Agreement are the following exhibits:
Exhibit A: Form of Supplemental Opinion of Bond
Counsel
Exhibit B: Metes and Bounds Description of the
Site
Exhibit C: Title Exceptions
Section 1.6. Benefits of Agreement. Nothing in this
Agreement, expressed or implied, is intended or shall be
construed to confer upon any person other than the City, the
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Manager, and the owners from time to time of the Instruments,
any right, remedy, or claim, legal or equitable, under or by
reason of this Agreement or any provision hereof, this
Agreement and all its provisions being intended to be and being
for the sole and exclusive benefit of the City, the Manager,
and the owners from time to time of the Instruments.
Section 1.7. Inconsistent Provisions. All ordinances,
orders or resolutions, or parts thereof, which are in direct
conflict or inconsistent with any provision of this Agreement
are hereby repealed to the extent of such conflict and the
provisions of this Agreement shall be and remain controlling as
to the matters contained herein; provided, however, that to the
extent of any conflict between the provisions of this Agreement
and the Ordinances, the provisions of the Ordinances shall
control. The parties agree that no provision of the Ordinances
or the Instruments shall ever be construed as impairing the
obligation of this contract it being expressly agreed that the
provisions of this Agreement shall be subject and subordinate
in all respects to the provisions of the Ordinances and the
Instruments.
Section 1.8. Governing Law. This Agreement shall be
construed and enforced in accordance with the laws of the State
of Texas and the United States of America.
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Section 1.9. Incorporation of Recitals of the Parties.
The recitals of the parties contained in the preamble hereof
are hereby incorporated by reference and made a part of this
Agreement for all purposes as if the same were restated in full
in this Section.
Section 1.10. Notices -Waiver. Wherever this Agreement
provides for notice of any event, such notice shall be shall be
sufficiently given (unless otherwise herein expressly provided)
if in writing and sent by United States Mail, first class
postage prepaid, to the address of the party to receive such
notice specified below at the close of business on the Business
Day next preceding the mailing of such notice.
If to the City at:
City of Lubbock, Texas
Municipal Building
1625 13th Street
Lubbock, Texas 79401
Attention: Assistant City Manager
for Financial Services
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If to the Manager at:
Science Spectrum
5052 50th Street
Lubbock, Texas 79414
Attention: President
Where this Agreement provides for notice in any manner,
such notice may be waived in writing by the party entitled to
receive such notice, either before or after the event with
respect to which such notice is given, and such waiver shall be
the equivalent of such notice.
Section 1.11. Construction of Terms. If appropriate in
the context of this Agreement, words of the singular number
shall be considered to include the plural, words of the plural
number shall be considered to include the singular, and words
of the masculine, feminine or neuter gender shall be considered
to include the other genders. The parties acknowledge that the
parties and their counsel have reviewed and revised this
Agreement and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of
this Agreement or any exhibits or amendments hereto.
Section 1.12. Public Meeting. It is officially found,
determined, and declared by the City that the meeting at which
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this Agreement is approved by the City 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 Agreement, was given, all as required by Article 6252-17,
Vernon's Texas Civil Statutes, as amended.
Section 1.13. Effective Date. This Agreement shall
take effect and be in full force upon its execution and
delivery by the parties hereto.
Section 1.14. Term of Agreement. The term of this
Agreement shall be the period of time from the latest date
shown as the date either the City or the Manager executed this
Agreement until the date which is the date the final payment
from the City to the Manager is due pursuant to Section 3.4(a)
hereof, unless sooner terminated as provided in this
Agreement. This Agreement shall terminate automatically, and
without the requirement of any action by the parties, upon
notification by the Internal Revenue Service to the Manager
that it is no longer an organization described in Section
501(c)(3) of the Code.
Section 1.15. Waivers and Amendments. Except with
respect to waivers referred to in Article Four which may occur
as provided in Article Four, any provision of this Agreement
may be waived if, but only if, such waiver is. in writing and
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5 926 E.
signed by the City and the Manager. Any provision of this
Agreement may be amended by any provision of the Ordinances and
otherwise if, but only if, such amendment is in writing and is
signed by the City and the Manager. No waiver or amendment
shall be effective if such waiver or amendment would have a
material adverse effect on the rights of the owners from time
to time of the Instruments.
Section 1.16. Successors and Assigns. The provisions
of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted
successors and assigns. The Manager agrees that it will not
assign this Agreement or take or permit the taking of any
action which would result in a successor to the Manager without
the prior written consent of the City, which consent may be
withheld in the City's sole and absolute discretion.
Section 1.17. Counterparts. This Agreement may be
executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute
one and the same instrument.
Section 1.18. Table of Contents; Article Titles;
Captions. The Table of Contents, Article Titles, and Section
Captions in this Agreement are inserted for convenience of
reference only and in no way define, describe, limit, or expand
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the scope or intent of this Agreement or any of the provisions
hereof.
Section 1.19. Entire Agreement. This Agreement
contains the entire agreement between the parties relating to
the transactions contemplated hereby on its Effective Date.
All prior or contemporaneous agreements, understandings,
representations or statements, oral or written, are superseded
hereby. It is expressly provided that amendments to this
Agreement may be made by the Ordinances.
Section 1.20. Partial Invalidity. Any provision of
this Agreement which is unenforceable or invalid or the
inclusion of which would affect the validity, legality, or
enforcement of this Agreement shall be of no effect, but all
the remaining provisions of this Agreement shall remain in full
force and effect.
Section 1.21. Further Assurances. Both the City and
the Manager agree that it will without further consideration
execute and deliver such other documents and take such other
action as may be reasonably requested by the other party to
consummate more effectively the transactions contemplated
hereby.
[END OF ARTICLE ONE].
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ARTICLE TWO
CITY'S INTENDED FINANCING
Section 2.1. City to Issue Obligations. Subject to the
conditions set forth in this Article Two, the City agrees to
borrow the sum of at least Five Million and No/100 Dollars
($5,000,000.00) to acquire the Site and to finance the
construction and equipment of the Exhibition Hall/Auditorium.
Suich borrowing is to be evidenced through the issuance of
Cer_ }icates of Obligation, the interest on which is excludable
from gross income of the owners thereof for federal income tax
purposes, Contractual Obligations the interest on which may be
includable in gross income of the owners for federal income tax
purposes. All financial obligations of the City pursuant to
this Agreement are conditioned upon, and are in all respects
subject to, the issuance by the City of the Instruments and
upon the Manager fulfilling its obligations pursuant to the
Ordinances and this Agreement. The City shall at all times
prior to the final maturity of the Certificates of Obligation
own all portions of the property financed with the proceeds of
the Certificates of Obligation.
Section 2.2. Authority Retained in City. The City
agrees to provide copies of the Ordinances to the Manager at
least three weeks prior to their adoption in order to allow the
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Manager to review and comment upon the provisions of the
Ordinances. The Manager will be allowed three Business Days
from, but not including, the day it receives the Ordinances to
comment on the Ordinances. The City reserves the right to
unilaterally reject any comment it receives from the Manager.
The City shall notify the Manager of any such unilateral
rejection within three Business Days from, but not including,
the day it receives the Manager's comments. In the event of
any such unilateral rejection by the City, the Manager may,
within one Business Day from, but not including, the day it
receives the City's notice of rejection, notify the City ^= its
termination of this Agreement. In the event the Manager
terminates this Agreement under such circumstances, neither
party shall have any further obligation to the other. In the
event the Manager does not terminate this Agreement under such
circumstances, the Manager shall be deemed to have accepted the
provisions of the Ordinances. All details, characteristics,
terms and procedures with respect to the Instruments shall be
and remain solely at the discretion of the City. This
Agreement shall not bind the City in any manner with respect to
the details, characteristics, terms and procedures with respect
to issuance of the Instruments until the Instruments have been
issued, except that the City agrees to use reasonable diligence
in proceeding with the issuance of the Instruments. In the
event the City fails for any reason, whether within its control
or not, to issue the Instruments prior to August 1, 1991, the
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City shall be deemed to have terminated this Agreement for
cause and neither the City nor the Manager shall Lave any
claim, cause of action, or recourse against the other as a
result of such termination by virtue of the approval,
execution, or delivery of this Agreement.
Section 2.3. Conditions to Issuance of Instruments.
Unless and until each of the following conditions has been
satisfied, or waived by the City at its sole discretion, the
City shall have no obligation under this Agreement to deliver
the Instruments:
(a) No suit, action, investigation or legal or
administrative proceeding shall be seriously threatened or
pending before any court or governmental agency which is likely
to result in the restraint, prohibition or the obtaining of
damages or other relief in connection with the issuance of the
Instruments or the consummation of the transactions
contemplated hereby, or which, in the opinion of the City,
would have a materially adverse effect on the transactions
contemplated hereby.
(b) All steps to be taken and all instruments and
other documents to be executed, and all other legal matters in
connection with the transactions contemplated by this Agreement
shall be reasonably satisfactory in legal form and effect to
Counsel for the City.
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(c) At or prior to the issuance and delivery of the
Instruments, the City shall have received two (20 executed
copies of each of the following documents:
(1) the approving Opinion, dated the Issue
Date, of Fulbright & Jaworski, as bond counsel ("Bond
Counsel"), delivered to the City, relating to, among
other things, the validity of the Instruments, and the
tax-exempt status of the interest on the Certificates of
Obligation for federal income tax purposes;
(2) an Opinion, dated the date of the issuance
and delivery of the Instruments, of Bond Counsel,
addressed to the City containing the information
specified in Exhibit A hereto;
(3) a certificate of the Manager, dated the
Issue Date and signed on its behalf by the President of
its Board of Trustees, in form satisfactory to the City,
to the effect that the representations and warranties of
the Manager herein, or in any certificate or document
delivered by the Manager pursuant to the provisions
hereof, are true and correct on and as of the Issue Date
as though such representations and warranties were made
on and as of the Issue Date, and all agreements or
conditions to be performed or complied with by the
Manager hereunder on or prior to the Issue Date have
been performed or complied with;
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(4) a copy of the resolutions or other
proceedings of the Manager authorizing the execution and
delivery of this Agreement and the transactions
contemplated hereby, in each case certified by the
Secretary of the Board of Trustees of the Manager as
having been duly adopted and being in full force and
effect and as being true, accurate and complete copies
thereof;
(5) an unqualified opinion, dated on or prior
tia the Issue Date, of the Attorney General of the State
of Texas, relating to the legality and validity of the
Instruments, and approving the Instruments, as required
by law;
(6) evidence satisfactory to the City that the
Instruments have been registered by the Comptroller of
Public Accounts of the State of Texas as required by law;
(7) a letter from each of the nationally
recognized rating services which now maintain a rating
on the debt of the City indicating a rating for the
Instruments which is not lower than the rating now
assigned by each such rating service, respectively, to
debt of the City;
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(8) a certificate, dated the Issue Date,
executed by the President of the Board of Directors of
the Manager, to the effect that except to the extent
heretofore disclosed to the City, no litigation is
pending or, to the knowledge of such Person, threatened,
in any court to restrain or enjoin the operations or
activities of the Manager, or in any way contesting or
affecting the creation, organization, or tax-exempt
status of the Manager or the validity of this Agreement,
or contesting the powers of the Manager to execute,
deliver, and perform this Agreement;
(9) a certificate, dated the Issue Date, of the
President of the Board of Directors of the Manager, to
the effect that no event affecting the Manager has
occurred since the date of the City's Official Statement
relating to the Instruments which should be disclosed
therein for the purpose for which it is to be used or
which is necessary to be disclosed therein in order to
make the statements and information therein not
misleading in any respect and the information contained
in such Official Statement relating to the Manager and
this Agreement is true, complete, and correct in all
material respects;
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(10) a Certificate Concerning Tax -Exempt Status
and Related Matters of the Manager, dated the Issue
Date, and signed by the President of the Board of
Directors of the Manager, in the form approved by Bond
Counsel; and
(11) such additional legal opinions,
certificates, proceedings, instruments and other
documents as Bond Counsel may reasonably request to
evidence compliance by the Manager with legal
requirements, the truth and accuracy, as of the Issue
Date, of the representations and warranties of the
Manager contained herein and the due performance or
satisfaction by the Manager at or prior to such time of
all agreements then to be performed and all conditions
then to be satisfied by the Manager.
All such opinions, certificates, letters, agreements and
documents will be in compliance with the provisions hereof only
if they are satisfactory in form and substance to the City and
to Bond Counsel. The City shall be entitled to receive such
conformed copies or photocopies of such opinions, certificates,
letters, agreements and documents as the City may reasonably
request.
[END OF ARTICLE TWO]
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ARTICLE THREE
CREATION OF FUNDS AND ACCOUNTS;
CREDITS THERETO AND PAYMENTS THEREFROM
Section 3.1. Creation of City Funds and Accounts. The
City agrees to create and establish in the Ordinance
authorizing the issuance and delivery of the Certificates of
Obligation an "Exhibition Hall/Auditorium Fund," a
"Construction Fund" and such other Funds and Accounts as the
;ty, in its sole discretion, shall deem advisable.
Section 3.2. Deposits to Exhibition Hall/Auditorium
Fund. All Gross Revenues shall be deposited, as received by
either the City or the Manager, in the Exhibition
Hall/Auditorium Fund. The provisions of the Ordinance
authorizing the Certificates of Obligation may, in the sole
discretion of the City, establish alternate Funds or Accounts
to which such deposits may be made.
Section 3.3. Deposits to Construction Fund. Proceeds
of the Instruments shall be deposited to separate Accounts
within the Construction Fund and shall be used as specified in
this Agreement and in the Ordinances authorizing the
Certificates of Obligation and Contractual Obligations.
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Section 3.4. Payments from Exhibition Hall/Auditorium
Fund.
(a) From amounts on deposit in the Exhibition
Hall/Auditorium Fund deposited thereto as provided in Section
3.2 of this Agreement, and not otherwise, the City agrees to
pay to the Manager during the Term of this Agreement an amount
equal to Gross Revenues of the Exhibition Hall/Auditorium for
the one-year period commencing with the Opening and ending on
the day prior to the first anniversary of the Opening and,
thereafter, an amount equal to Gross Revenues of the Exhibition
Hall/Auditorium less Two Hundred Thousand and No/100 Dollars
($200,000) per year, until the last Business Day of the month
during which the twenty-first annual anniversary of the Opening
occurs. Payments to the Manager shall be made on the last
Business Day of each month in which a payment is due. The
first monthly payment shall be made on the last Business Day of
the month in which the Opening occurs. The first twelve
monthly payments shall equal the Gross Revenues of the
Exhibition Hall/Auditorium since the date of the prior monthly
payment date (except the first monthly payment which shall
equal the Gross Revenues of the Exhibition Hall/Auditorium
since the Opening). Following the first twelve monthly
payments, the next eleven (11) monthly installments in each
year shall equal the Gross Revenue of the Exhibition
Hall/Auditorium for such month less Sixteen Thousand Six
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Hundred Sixty -Six Dollars and Sixty -Six Cents ($-16,666.66) and
the twelfth monthly installment in each year shall equal the
Gross Revenues of the Exhibition Hall/Auditorium for such month
plus any other amount deposited to the Exhibition
Hall/Auditorium Fund during such year remaining after making
the required calculation of the amounts therein to be retained
by the City, less Sixteen Thousand Six Hundred Sixty -Six
Dollars and Seventy -Four Cents ($16,666.74) plus the amount of
any deficiency in the amount to be retained by the City with
respect to all prior monthly payments for any year.
(b) The Manager agrees to use all amounts paid to it
pursuant to this Section 3.4 first for the payment of
Maintenance and Operating Expenses (other than amounts owed to
it for services as the Manager) and second, if there be any
amounts remaining after the payment by the Manager for
Maintenance and Operating Expenses (other than amounts owed to
it for services as the Manager) to pay it for services as
Manager. The Manager agrees to use its fee, for its exempt
purpose within the corporate limits of the City for the direct
benefit of the City and its citizens to accomplish public
purposes of the City.
(c) The amounts to be paid to the Manager pursuant to
this Section 3.4 are payable only to the extent of amount
deposited to the Exhibition Hall/Auditorium Fund as provided in
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Section 3.2 and only to the extent of funds then on deposit,
less any amounts to be retained by the City, on each date on
which a payment is due. The Manager shall have no lien or
encumbrance on Gross Revenues except to the extent required and
allowed by the Act. The amounts to be paid to the Manager
pursuant to this Section 3.4 are to be paid for the benefit of
the City; it being expressly agreed that no such payment shall
be made in a manner which results in a lending of credit of the
City or a gratuitous application of public funds to private use.
Section 3.5. Payments from Construction Fund. (a) In
consideration of the assignment of the Lease to the City and
the acquisition of the interest in the Equipment described
therein, in addition to the amounts otherwise required to be
paid under the Lease, the City agrees to pay to the Manager,
from an Account of the Construction Fund into which the
proceeds of the Contractual Obligations are deposited the
amounts required to be paid by the City as assignee of the
Lease to ISC for the Equipment pursuant to Section 2.1 of the
Lease at such time or times as the City as assignee of the
Lease is obligated to make such payments to ISC pursuant to
Section 2.1 of the Lease. The Manager agrees to pay such
amounts to ISC in compliance with the provisions of Section 2.1
of the Lease. The City shall pay from the Account of the
Construction Fund into which the proceeds of the Contractual
Obligations are deposited, all costs of the issuance of the
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Instruments which cannot be or are not paid from the Account of
the Construction Fund into which the proceeds of the
Certificates of Obligation are deposited.
(b) The City agrees to pay to the Manager, from the
Account of the Construction Fund into which the proceeds of the
Certificates of Obligation are deposited the Purchase Price on
the Closing Date and, against such invoices and supporting
documentation as may be reasonably required by the City,
amounts for the payments of costs of constructing the
Exhibition Hall/Auditorium. The City shall pay from the
Account of the Construction Fund into which the proceeds of the
Certificates of Obligation are deposited, an amount of the
costs of issuance of the Certificates of Obligation which does
not exceed the amount described in Section 147(g) of the Code.
No amount shall be paid from the Account of the Construction
Fund into which the proceeds of the Certificates of Obligation
are deposited to acquire the City's interest in the Equipment.
(c) Any amounts remaining in the Accounts in the
Construction Fund following payment of all costs of issuance
permitted to be paid therefrom, completion of the construction
of the Exhibition Hall/Auditorium and acquisition of the
Equipment shall be deposited as provided in the Ordinances
authorizing issuance of the Instruments.
[END OF ARTICLE THREE]
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ARTICLE FOUR
CONVEYANCE OF PROPERTY
Section 4.1. Agreement to Convey and Accept. In
consideration of their covenants set forth in this Agreement,
the Manager agrees to convey to the City, and the City agrees
to accept the conveyance from the Manager, of the following
described property on the terms and conditions set forth in
this Article Four:
(a) All of the land (the "Site") situated in the City
of Lubbock, the County of Lubbock and the State of Texas,
described on Exhibit B attached hereto and made a part hereof.
(b) All structures, buildings, improvements and
fixtures, if any, located on the Site on the Closing Date
("Improvements"). Improvements are not intended to include any
structures, buildings, improvements, and fixtures to be
constructed by the City after the Closing Date and
specifically, do not include the Exhibition Hall/Auditorium.
(c) All personal property, if any, owned by the
Manager located on or in the Site or Improvements and used in
connection with the operation and maintenance of the Site or
Improvements ("Personal Property").
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(d) All intangible property (including specifically
but without limitations the Manaaer`s rights under the Lease)
owned by the Manager and used in connection with the Site,
Improvements. and Personal Property, including all trademarks
and trade names used in connection with any part of the Site
and Improvements, all hereditaments, privileges, tenements and
appurtenances belonging to the Site, all right, title and
interest of the Manager in and to all open or proposed
highways, streets, roads, avenues, alleys, easements, strips,
gores and rights-of-way in, on, across, in front of, contiguous
to, abutting or adjoining the Site, and all licenses, permits
and warranties now in effect with respect to the Site,
Improvements and Personal Property ("Intangible Property"), all
of which shall be transferred to City pursuant to an assignment
in a form acceptable to the City and Furnished by the Manager
("Assignment of Intangible Property").
The Site, Improvements, Personal Property, and
Intangible Property are sometimes collectively referred to in
this Article Four as "Premises".
Section 4.2. Closing. (a) The consummation of the
conveyance of the Premises ("Closing") shall take place at the
City Hall of the City, on a date (the "Closing Date") mutually
agreed upon by the parties, but not later than the earlier of:
(i) thirty (30) days after termination of the Due Diligence
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Period as described in Section 4.3 of this Agreement; or (ii)
sixty (60) days after the Issue Date, unless such date is
extended by written agreement signed by the parties. The
Closing Date shall be on or after the Issue Date and prior to
commencement of construction of the Exhibition Hall/Auditorium.
(b) At Closing, the Manager shall deliver the following
documents: (i) A General Warranty Deed in recordable form
properly executed on behalf of the Manager, conveying to the
City the Site and Improvements in fee simple, subject only to
the Permitted Exceptions; (ii) A Bill of Sale in a form
acceptable to the City and furnished by the Manager executed by
the Manager, conveying to the City the Personal Property; (iii)
An affidavit sworn by an officer of the Manager to the effect
that the Manager is not a "foreign person" which affidavit
shall be in a form acceptable to the City and furnished by the
Manager, or in such other form as may be prescribed by federal
regulations; and (iv) A duly executed Assignment of Intangible
Property as described in section 4.1(d) of this Agreement
assigning and conveying to the City the Intangible Property;
(c) At Closing, the City shall deliver to the Manager
the Purchase Price for the Site and such evidence as the
Manager's Counsel may reasonably require as to the authority of
the person or persons executing documents on behalf of the City.
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Section 4.3. Conditions to Closing. In addition to all
other conditions to the completion of the transaction described
in this Agreement, the Manager and the City agree that the
closing of this sale and purchase is subject to satisfaction,
approval or waiver by the City of the following conditions on
or before 5:00 p.m., Lubbock, Texas time, within thirty (30)
days after the Issue Date ("Due Diligence Period"):
(a) inspection and approval of the physical condition
and use of the Premises, including without limitation, the
availability for access, utility services, zoning,
environmental risks, engineering and soil conditions. For the
purpose of conducting physical inspections, the Manager agrees
to provide the City and its authorized agents reasonable access
to the Premises at all reasonable times during the Due
Diligence Period upon at least forty-eight (48) hours prior
written notice to the Manager. The City shall provide the
Manager with written notice of any objectionable physical
conditions on or relating to the Premises, which the City will
require be corrected prior to Closing.
(b) Inspection and approval of such documents
relating to the Premises as the City may request, all of which
shall be made available to the City at the offices of the
Manager at reasonable times for inspection and copying by the
City at the City's expense.
0A
In the event any of the conditions set forth in this
Section 4.3 are not satisfied or waived by the City within the
Due Diligence Period, the City shall notify the Manager in
writing of termination of this Agreement ("City's Termination
Notice") prior to the expiration of the Due Diligence Period.
Upon receipt of the City's Termination Notice, both the Manager
and the City shall be released and discharged from all further
obligations under this Agreement, and neither the Manager nor
the City shall be subject to any claim by the other for damages
of any kind. If no City's Termination Notice has been served
upon the Manager within the time provided in this Section 4.3,
all conditions shall be deemed to have been satisfied or waived
and the City's obligations to close shall be firm with respect
to the conditions of this Section 4.3.
Section 4.4. Evidence of Title. As evidence of the
Manager's title, the Manager shall deliver to the City:
(a) Title Commitment. As soon as practicable after
the execution of this Agreement by the Manager but before the
Issue Date, at the Manager's expense, a title commitment for an
owner's policy of title insurance, on the standard form
promulgated by the Texas State Board of Insurance, issued by a
title company acceptable to the City in the amount of the price
paid by the Manager to acquire the Premises showing good and
indefeasible title to the Premises in the Manager's name
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subject only to (i) the title exceptions described on Exhibit C
attached hereto and made a part hereof, and (ii) liens and
encumbrances arising from and after the date of approval of
this Agreement by the City of a definite or ascertainable
amount which can be removed at Closing (collectively "Permitted
Exceptions"). If the commitment discloses exceptions other
than the Permitted Exceptions, the City, within fifteen (15)
Business Days following the date on which the City received the
commitment, shall deliver to the Manager written notice of the
City's objections, if any, to such exceptions ("Unpermitted
Exceptions"). If the City fails to deliver such written notice
or objection to the Manager within such fifteen (15) Business
Day period, the City shall be deemed to have waived its right
to object to such Unpermitted Exceptions, which shall
thereafter be deemed Permitted Exceptions. In the event that
the City shall so object to any such Unpermitted Exceptions,
the Manager shall notify the City within five (5) Business Days
following the date of the City's notice of such objections that
the Unpermitted Exceptions have been, or will be at or prior to
Closing, removed from the commitment or are or will be insured
around by the title company pursuant to an endorsement to the
title policy. In such event, if reasonably required to allow
the parties to prepare for closing, the Closing Date shall be
deferred to a date mutually agreed upon by the parties, but not
later than December 31, 1991.
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(b) Survey. As soon as practicable after the
execution of this Agreement by the Manager, at the Manager's
expense, a survey of the Site and Improvements, prepared and
certified to have been made in accordance with ALTA/ACSM
standards on or after the execution of this Agreement by the
Manager by a registered land surveyor. The City agrees to
reimburse the Manager for the expense of the survey on the
Closing Date after the Closing has occurred. If the survey
shows any material encroachments over a building, set -back or
property line, a prohibited encroachment of a material nature
over any easement or any other matter which does or could in
the future materially interfere with the use, operation or
financing of the Site and Improvements or render title thereto
unmarketable and which are not Permitted Exceptions
(collectively "Survey Defects"), the City, within fifteen (15)
Business Days of the date it receives the survey, may deliver
to the Manager written notice of those Survey Defects to which
it objects, or the City will be deemed to have waived any right
to such objection. The Manager shall have fifteen (15)
Business Days ("Survey Cure Period") from the date of receipt
of the City's notice of objections, if any, to cure the Survey
Defects. If the Manager fails to do so, the City shall, within
ten (10) days after the end of the Survey Cure Period, elect
either to terminate this Agreement by delivering written notice
thereof to the Manager within said ten-day period, or be deemed
to have accepted the Premises as is. If the City fails to
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deliver such notice of termination within the time provided,
(i) the City shall be deemed to have agreed to accept the
Premises as is, and (ii) this Agreement shall remain in full
force and effect. All Survey Defects (1) to which the City
makes no objection within the time provided in this paragraph,
or (2) which the Manager does not cure within the Survey Cure
Period, and provided the City does not terminate this Agreement
as permitted herein, will, in either case, thenceforth be
deemed Permitted Exceptions.
Section 4.5- Representations and Warranties. The
Manager represents and warrants that as of the date of its
execution of this Agreement and as of the Closing Date:
(a) the Manager has received no notice from any
governmental authority of any pending or threatened (i)
zoning.,..building, fire-, or health code violations or violations
of other governmental requirements or regulations with respect
to the Premises that have not previously been corrected, or
(ii) any condemnation of the Premises. The Manager further
warrants and represents that in the event it receives any such
notice prior to the Closing Date, it will provide to the City
copies of any such notice. The Manager agrees to correct any
matters disclosed in such notice. If any such matter cannot be
corrected by the Manager by Closing, the Manager agrees to pay
to the City at Closing the amount estimated to be required to
correct such matter.
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(b) That as of the date hereof, there are no leases
or other agreements for occupancy in effect with respect to the
Premises.
(c) -That the Manager has received no notices from
insurers of defects in the Improvements which have not been
corrected.
(d) That there are no legal actions pending or
threatened against the Premises nor are there any violations of
any building codes or other statutes affecting the use,
occupancy and enjoyment of the Premises.
(e) That the representations and warranties contained
in this section shall survive the Closing.
Section 4.6.- The Manager's Covenants. Between the date
of the execution of this Agreement and the Closing, the Manager
shall:
(a) Maintain the Premises in its present condition,
ordinary wear and tear excepted; and
(b) Maintain all casualty, liability and hazard
insurance currently in force with respect to the Premises.
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Section 4.7. Prorations. The following adjustments to
the Purchase Price paid hereunder shall be made between the
Manager and the City and shall be prorated (as applicable) on a
per diem basis as i_f the City owned the Premises for the entire
day on the Closing Date: All real estate taxes and
installments of special assessments due and payable in the
calendar year of Closing. All other installments of special
assessments not yet due and payable shall be paid by, or the
responsibility of, the City.
Section 4.8. Title Charges. The City shall pay the
cost of recording the instruments of conveyance. If the
transaction is terminated by either party on account of default
by the other, the defaulting party shall pay all escrow costs
billed by the title company. In the event this transaction
shall close as provided in this Agreement, closing costs shall
be paid by the City. Each party shall pay its own attorneys'
fees except as otherwise provided in this Agreement.
Section 4.9. Risk of Loss. The Manager shall bear all
risk of loss with respect to the Premises up to the Closing
Date. Notwithstanding the foregoing, in the event of damage to
the Premises by fire or other casualty prior to the Closing
Date, the Manager shall repair and restore the Premises. The
Manager shall promptly notify the City in writing of any such
fire or other casualty.
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Section 4.10. Condemnation. In the event between the
date of this Agreement and the Closing Date, any condemnation
or eminent domain proceedings are initiated (by any
governmental entity other than the the City) which might result
in the taking of any part of the Improvements to the Site or
the taking or closing of any right of access to the Premises,
the City may:
(a) terminate this Agreement by written notice to the
Manager; or
(b) proceed with the Closing, in which event the
Manager shall assign to the City all of the Manager's right,
title and interest in and to any award made in connection with
such condemnation or eminent domain proceedings.
The Manager shall immediately notify the City in writing
of the commencement or occurrence of any condemnation or
eminent domain proceedings. If such proceedings would result
in the taking of any Improvements to the Site or the taking or
closing of any right of access to the Premises, the City shall
then notify the Manager, within ten (10) days of the City's
receipt of the Manager's notice, whether the City elects to
exercise its rights under subparagraph (a) or subparagraph (b)
of this Section 4.10. Closing shall be delayed, if necessary,
until the City makes such election.
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Section 4.11. Default by the Manager. If this
transaction is not consummated by reason of a default. by the
Manager hereunder, the City shall have the; right to: (a)
declare this Agreement terminated, and (b) recover money
damages from the Manager, but such money damages shall be
limited to actual out-of-pocket expenses incurred by the City
and shall not include consequential damages.
Section 4.12. Time of Essence. Time is of the essence
with respect to the transactions contemplated by Article Two
this Agreemie--nt.
Section 4.13. Further Assurances. Both the Manager and
the City agree that they will without further consideration
execute and deliver such other documents and take such other
action, whether prior or subsequent to Closing, as may be
reasonably requested by the other party to consummate more
effectively the transactions contemplated hereby.
[END OF ARTICLE FOUR]
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ARTICLE FIVE
MANAGEMENT AGREEMENT
Section 5.1. Retention of Services. The primary goal
of this Article is to secure for the City the expertise and
services necessary to operate the Exhibition Hall/Auditorium at
a level consistent with the community in which the Exhibition
Hall/Auditorium is to be located and with economic efficiency
consistent with such level (the "Primary Goal"). The City
hereby retains the Manager to manage and supervise construction
of the Exhibition Hall/Auditorium and to supervise, operate and
manage the Exhibition Hall/Auditorium in the name, for the
account, and on behalf of the City, pursuant and subject to the
terms and conditions set forth in this Article, and the Manager
hereby accepts such retention and agrees to render such
services as are hereinafter set forth. The compensation to be
paid to the Manager for its services as Manager under this
Agreement shall be paid solely from the source and only to the
extent provided in Section 3.4. Subject to the foregoing, the
City agrees to pay the Manager the Gross Revenues, less amounts
to be retained by the City pursuant to Section 3.4, less
Maintenance and Operating Expenses.
Section 5.2. Manager's Authority. Subject to the
City's authority set forth in Section 5.3 of this Article, the
Manager shall have the full responsibility to supervise,
5
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operate and manage the day-to-day operations of the Exhibition
Hall/Auditorium in accordance with the Budget and Written
Policies and Procedures of the Exhibition Hall/Auditorium as
established from time to time by the City and to perform the
specific functions set out in this Article without the prior
consultation or approval of the City, except, that prior
specific authorization of the City must be obtained for any
action by the Manager on the following:
(a) Commitment of the City for capital expenditures
not included in the Budget of the Exhibition Hall/Auditorium;
(b) Execution of or otherwise binding of the City to
any contract or lease;
(c) Disposition of any asset of the City; and
(d) Execution of any contract or agreement with any
third party with respect to the Premises or the Exhibition
Hall/Auditorium.
Section 5.3. Control Retained in the City. The
governing body of the City shall retain all authority placed in
it by law which is non -delegable and shall retain such other
authority as shall not have been specifically delegated by it
to the Manager pursuant to the terms of the Article or
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otherwise. No provision of this Article or this Agreement is
intended to delegate, or shall be construed as delegating, any
non -delegable right or power of the City. To the extent of any
conflict or inconsistency between the provisions of any other
Section of this Agreement and this Section 5.3., the provisions
of the Section 5.3 shall control and the provisions in conflict
with or inconsistent with this Section 5.3 shall be of no force
or effect.
Section 5.4. Relationship of the Parties. The
Manager's appointment and actions hereunder are in the status
of an independent contractor to the City. In furtherance
thereof, the City and the Manager acknowledge and agree that
one is neither the employee, employer, principal, nor agent of
the other. Nothing contained in this Agreement shall
constitute or be construed to be or to create a partnership or
joint venture between the City and the Manager with respect to
the Exhibition Hall/Auditorium or any equity interest in the
Exhibition Hall/Auditorium on the part of the Manager. The
Manager and its Affiliate shall have the right to render
similar services for other Persons, whether or not engaged in
the same business, and may enter into such other business
activities as the Manager and its Affiliate, in their sole
discretion, may determine, including, but not limited to, other
transactions with the City that are beyond the scope of this
Agreement.
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Section 5.5. Management of the Exhibition
Hall/Auditorium. Consistent with all materially applicable
federal, state and local laws, the Manager shall perform those
functions reasonably required to manage the operations of the
Exhibition Hall/Auditorium in accordance with accepted
management techniques and the reasonable exercise of its
judgment. Without limiting the generality of the foregoing the
Manager shall be responsible for the performance of the
following duties during the Term of this Agreement:
(a) subject to the approval of the City and in
compliance with procurement laws applicable to the City,
engagement of an architect and arranging for architectural and
engineering services for the construction of the Exhibition
Hall/Auditorium ;
(b) entering into all appropriate lease and service
agreements with ISC, or such other provider of equipment for
the operation of the Exhibition Hall/Auditorium as may be
selected by the Manager; provided, however, that the Manager
must obtain the City's prior written approval of all lease and
service agreements with ISC or any other Person;
(c) subject to the approval of the City and in
compliance with procurement laws applicable to the City,
selection, supervision, and payment of all contractors engaged
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to provide labor, materials, and equipment in connection with
the construction of the Exhibition Hall/Auditorium;
(d) provision of all personnel reasonably necessary
to supervise and direct the completion of the construction of
the Exhibition Hall/Auditorium;
(e) entering into all necessary agreements for
exhibitions to be displayed within the Exhibition
Hall/Auditorium;
(f) operation and management of the Exhibition
Hall/Auditorium following its completion and provision of all
personnel, labor, and material reasonably necessary to properly
operate the Exhibition Hall/Auditorium; and
(g) from amounts paid to it by the City, the Manager
shall timely pay all Maintenance and Operating Expenses.
Section 5.6. Employees. The Manager shall be
responsible for hiring, promotion, discharge and supervision of
all employees performing services in and about the Exhibition
Hall/Auditorium. Such employees shall be in the employ of the
Manager and, as such, the Manager shall be solely liable to
such employees for their wages, compensation, and "employee
benefits," if any ("employee benefits" being defined as an
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employer's contribution to F.I.C.A., unemployment compensation,
and other employment taxes, pension plan contribution, worker's
compensation, group life and accident and health insurance
premiums, retirement, disability and other similar benefits
applicable to such employees), all of which shall be set and
determined solely by the Manager.
Section 5.7. Administrator. The Manager shall provide
a full-time administrator of the Exhibition Hall/Auditorium to
oversee the day-to-day management thereof. The administrator
shall be the employee of the Manager, but shall at all times be
acceptable to the City.
Section 5.8.
Inside Consultants.
The Manager shall
provide such consultants who are employees of the Manager as it
deems necessary to achieve the Primary Goal, except for
consultation services in connection with extraordinary matters
which are not covered by this Agreement. (Such "extraordinary
matters" being defined as any matter deemed by the Manager, in
its sole discretion, to involve such extraordinary time and
expense as to warrant prior approval thereof by the City before
undertaking to provide any services in connection therewith.)
Section 5.9. Outside Consultants. The Manager shall
recommend to, and if approved by the City, use its best efforts
to engage, on behalf of the City and at the City's sole
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expense, such consultants who are not employees of the Manager
as it deems necessary to achieve the Primary Goal.
Section 5.10. Recommendations Concerning Operations. At
least annually, the Manager shall consult with and make
recommendations to the City concerning the operations of the
Exhibition Hall/Auditorium.
Section 5.11. Legal Compliance. The Manager shall
comply with all applicable federal, state and local rules,
regulations, statutes, laws and ordinances governing the
operations of the Exhibition Hall/Auditorium.
Section 5.12. Insurance. The Manager shall arrange for
and obtain, at the City's expense and subject to the approval
of the City to the extent not described in Written Policies and
Procedures, insurance with respect to the Exhibition
Hall/Auditorium of such kinds, in such form and amounts, and
with such company or companies, all to the extent available and
as the City shall deem adequate and desirable, and in
accordance with any agreement of the City relating to the
Exhibition Hall/Auditorium. The City and the Manager shall be
named as coinsureds or additional insureds, to the extent their
interests appear on all such insurance maintained with respect
to the Exhibition Hall/Auditorium. If the Manager shall
arrange for and obtain such insurance, it may provide all or
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part of said insurance in the form of one or more blanket
policies applying to it or to its Affiliates, with the
applicable prorated expense thereof being applied to the
Exhibition Hall/Auditorium.
Section 5.13. Rate and Fee Schedule. The Manager shall
determine the fee schedules for all services and rates charged
by the Exhibition Hall/Auditorium; provided, however, that
rates and charges for the Exhibition Hall/Auditorium shall be
approved by the City, in consultation with, and based upon
recommendations of, the Manager. Such fees and rates shall be
in compliance with the requirements of Section 3(c) of the Act,
shall be consistent with the financial viability of the
Exhibition Hall/Auditorium and shall be consistent with fees
and rates prevailing from time to time in the community.
Section 5.14. Preparation and Adoption of Construction
Budge and Annual Budget. The Manager shall prepare a detailed
construction budget with respect to the construction of the
Exhibition Hall/Auditorium and shall cause such construction
budget to be presented to the City prior to awarding any
contract for the construction of the Exhibition
Hall/Auditorium. The construction budget shall be based upon
bids received by the Manager in compliance with applicable
procurement law pertaining to the City. Upon adoption of the
construction budget by the City, the Manager shall be
authorized to commence, or cause to be commenced, construction
of the Exhibition Hall/Auditorium for the City.
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The Manager shall prepare an annual detailed Budget for
the Exhibition Hall/Auditorium setting forth, in part, major
operating objectives, anticipated revenue, expenses, cash flow
and capital expenditures and shall cause such Budget to be
presented to the City not later than thirty (30) days prior to
the commencement of each Fiscal Year of the City for its
acceptance, rejection, or modification by the City. Upon
adoption or any modification of such Budget by the City, it
shall serve as a guide for the operation of the Exhibition
Hall/Auditorium during the ensuing year. If a Budget is
disapproved upon its submission, then the last month of the
prior year's Budget shall be used as a guideline for operating
the Exhibition Hall/Auditorium until a new Budget therefor is
approved by the City. In the event that the City disapproves
any Budget, such disapproval shall specify those items which
are disapproved, and the Manager shall resubmit an altered
Budget to the City within ten (10) days following such
disapproval.
Section 5.15. Accounting Records. The Manager shall
maintain or cause to be maintained, in accordance with
Generally Accepted Accounting Principals, the accounting
records of the Exhibition Hall/Auditorium and shall cause to be
delivered to the City, within thirty (30) days after the close
of each Fiscal Year, a balance sheet and a related statement of
revenue and expenses showing the results of the operations of
the Exhibition Hall/Auditorium during such Fiscal Year.
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Section 5.16. Manager's Covenants Regarding Maintenance
of Tax -Exempt Status of Certificates of Obligation.
A. General. The Manager shall not take any action
or omit to take any action which, if taken or omitted,
respectively, would adversely affect the excludability of
interest on any Certificate of Obligation from the gross
income, as defined in section 61 of the Code, of the owner
thereof for federal income tax purposes. The Manager and the
City shall execute such amendments hereof and supplements
hereto (and shall comply with the provisions thereof) as may,
in the Opinion of Counsel, be necessary to preserve or perfect
such exclusion. The Manager shall comply with each specific
covenant in this Section at all times prior to the last
maturity of the Certificates of Obligation, unless and until
there shall have been delivered to the Manager and the City an
Opinion of Counsel to the effect that failure to comply with
such covenant, either generally or to the extent stated
therein, shall not adversely affect the excludability of
interest on any Certificate of Obligation from the gross
income, as defined in section 61 of the Code, of the owner
thereof for federal income tax purposes, and thereafter such
covenant shall no longer be binding upon the Manager, generally
or to such extent as the case may be, anything in any other
Subsection of this Section to the contrary notwithstanding.
All defined terms used in this Section 5.16 not otherwise
defined in this Agreement shall have the meaning set forth in
the Regulations.
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B. Warranty of Representations. All representations,
warranties, and certifications made by the Manager in
connection with the delivery of the Certificates of Obligation
on the Issue Date, including, but not limited to, those
representations, warranties, and certifications contained in
any Certificate Concerning Tax -Exempt Status and Related
Matters executed by the Manager, are and shall be true,
correct, and complete in all material respects.
C. Tax -Exempt Status of the Manager. The Manager
represents and warrants that:
(1) its purposes, character, activities, and
methods of operation have not changed materially since
its organization and are not materially different from
the purposes, character, activities, and methods of
operation at the time of its determination by the
Internal Revenue Service to be an organization described
in section 501(c)(3) of the Code;
(2) it has not diverted a substantial part of
its corpus or income for a purpose or purposes other
than the purpose or purposes for which it is organized
or operated;
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(3) it has not operated in a manner that would
result in it being classified as an "action"
organization within the meaning of Section
1.501(c)(3)-l(c)(3) of the Regulations, including, but
not limited to, promoting or attempting to influence
legislation by propaganda or otherwise as a substantial
part of its activities;
(4) none of its directors, officers, or
incorporators, or any person or entity controlled by it,
or any other person or entity having a personal or
private interest in its activities has acquired or
received, directly or indirectly, any of its income or
assets, in any form, other than as reported or to be
reported to the Internal Revenue Service for its
appropriate fiscal year;
(5) it has not received any indication or
notice whatsoever to the effect that its exemption from
federal income taxation under section 501(a) of the Code
has been revoked or modified, or that the Internal
Revenue Service is considering revoking or modifying
such exemption, and such exemption is still in full
force and effect;
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(6) it has timely filed with the' Internal
Revenue Service all requests for determination, reports,
and returns required to be filed by it, and such
requests for determination, reports, and returns have
not omitted or misstated any material fact;
(7) it has not devoted more than an
insubstantial part of its activities in furtherance of a
purpose other than an exempt purpose within the meaning
of section 501(c)(3) of the Code; and
(8) it has not taken any action, nor knows of
any action that any other Person has taken, nor knows of
the existence of any condition, which would cause it to
lose its exemption from federal income taxation under
section 501(a) of the Code or cause interest on the
Certificates of Obligation to be includable in the
income of the recipients thereof for federal income tax
purposes.
D. Maintenance of Tax -Exempt Status of the Manager.
The Manager shall be organized and shall conduct its operations
in such a manner so as to qualify as an organization described
in section 501(c)(3) of the Code.
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E. Limited Non -Exempt Use or Loan of Proceeds. The
Manager shall not use (or permit the use of) any proceeds of
the Certificates of Obligation, or any income from the
investment thereof or any property financed with such proceeds
or income in any trade or business carried on by any person or
entity which is not an Exempt Person or in any unrelated trade
or business, as defined in section 513(a) of the Code, of an
Exempt Person or permit the direct or indirect loan of any such
proceeds, income, or property to any person or entity other
than an Exempt Person or to any person or entity which is an
Exempt Person for use in an unrelated trade or business, as
defined in section 513(a) of the Code, if the amount of such
proceeds, income, or property so used or loaned or portions
thereof so used in the aggregate, when added to the costs of
issuance financed directly or indirectly with Certificates of
Obligation proceeds, exceeds 5% of the proceeds of the
Certificates of Obligation. For purposes of this Subsection,
property is considered to be "used" by a Person if:
(1) it is sold or otherwise disposed of, or
leased, to such person or entity;
(2) it is operated, managed, or otherwise
physically employed, utilized, or consumed by such
person or entity, excluding operation or management
pursuant to an agreement which meets the guidelines set
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forth in Revenue Procedure 82-14, 1982-1 C.B. 459 or
82-15, 1982-1 C.B. 460, including any amendments or
revisions thereto;
(3) capacity in or output or service from such
property is reserved or committed to such person or
entity under a take -or -pay, output, incentive payment,
or similar contract or arrangement;
(4) such property is used to provide service to
(or such service is committed to or reserved for) such
person or entity on a basis or terms which are different
from the basis or terms on which such service is
provided (or committed or reserved) to members of the
public generally; or
(5) substantial benefits and burdens of
ownership of such property are otherwise effectively
transferred to such person or entity,
but the investment of amounts held for the credit of any fund
or account established under the Ordinance authorizing the
issuance of the Certificates of Obligation in accordance with
the applicable provisions thereof shall not constitute "use" of
property or a "loan" of proceeds. For purposes of this
Subsection, proceeds are considered to be "loaned to a person
if:
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5 9 2 6 E
(a) property financed with proceeds of the
Certificates of Obligation or any income from the investment
thereof is sold or leased to such person or entity in a
transaction which creates a debt for federal income tax
purposes;
(b) capacity in or service from such property is
committed to such person or entity under a take -or -pay, output,
or similar contract or arrangement; or
(c) indirect benefits, or burdens and benefits of
ownership, of such property are otherwise transferred to such
person or entity in a transaction which is the economic
equivalent of a loan,
and the amount of any such "loan" is the cost of such property
financed with proceeds or investment income of the Certificates
of Obligation.
F. Ceiling on Aggregate Amount of Bonds. The
Manager shall not take, omit to take, or suffer to occur any
action which, if taken, omitted, or suffered, respectively,
would cause the aggregate authorized face amount of all
previously issued and outstanding obligations (a) the interest
on which is excludable from the gross income, as defined in
section 61 of the Code, of the owners thereof for federal
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5 9 2 6 E
income tax purposes pursuant to section 103 of the Code or any
predecessor provisions and (b) which is or shall become
allocated, pursuant to section 145(b)(2) of the Code, (i) to
the Manager or (ii) to any other Person who is or shall become
an owner or a principal user of the project financed with the
Certificates of Obligation within the meaning of
section 144(a)(3) of the Code, during the three-year period
beginning on the later of the Issue Date or the date such
project is first placed in service, when added to the initial
principal amount of the Certificates of Obligation, to exceed
$150,000,000.
G. Prohibition on Certain Uses. The Manager shall
not use or permit the use of any proceeds of the Certificates
of Obligation or any income from the investment thereof
(1) Prohibited Facilities: to provide any
airplane, skybox, or other private luxury box, any
facility primarily used for gambling, or any store the
principal business of which is the sale of alcoholic
beverages for consumption off premises, or
(2) Costs of Issuance: to pay or otherwise
finance costs of issuance of the Certificates of
Obligation (e.g., underwriting compensation, trustee and
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rating agency fees, printing costs, City fees, and fees
and expenses of counsel) in an amount which exceeds 2%
of the proceeds of the Certificates of Obligation.
H. Not to Cause Classification as Arbitrage Bonds.
The Manager shall not take any action or omit to take any
action with respect to the Gross Proceeds of the Certificates
of Obligation or of any amounts expected to be used to pay the
principal thereof or the interest thereon which, if taken or
omitted, respectively, would cause any Certificates of
Obligation to be classified as an "arbitrage bond" within the
meaning of section 148 of the Code.
I. Not to Create Gross Proceeds. The Manager shall
not pledge or otherwise encumber, or permit the pledge or
encumbrance of, any money, investment, or investment property
as security for payment of the Certificates of Obligation, and
shall not establish any segregated reserve or similar fund for
such purpose unless in the Opinion of Counsel such action will
not adversely affect the excludability of interest on any
Certificates of Obligation from the gross income, as defined in
section 61 of the Code, of the owner thereof for federal income
tax purposes.
J. No Federal Guarantees. Except to the extent
permitted by section 149(b) of the Code and the regulations and
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5 9 2 6 E
rulings thereunder, the Manager shall not take or omit to take
any action which would cause the Certificates of Obligation to
be "federally guaranteed" within the meaning of section 149(b)
of the Code and the regulations and rulings thereunder.
Section 5.17. Ownership in City. The City shall own
all assets, tangible and intangible, which are purchased in
connection with the Exhibition Hall/Auditorium, including any
leasehold rights acquired by the Manager under its contracts
with ISC and all additions and accessions to such property
during the term of this Agreement. To the extent property and
leasehold rights are acquired by the Manager in connection with
the Exhibition Hall/Auditorium in its name, such property and
leasehold rights shall be held by it as trustee for the benefit
of the City, subject to the provisions of this Agreement.
[END OF ARTICLE FIVE]
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ARTICLE SIX
DEFAULTS AND REMEDIES
Section 6.1. Events of Default. If any of the
following events occur, it is hereby defined as and declared to
be and to constitute an Event of Default, whatever the reason
therefor and whether voluntary or involuntary or effected by
operation of law:
(A) default in the performance of any of the
Manager's obligations with respect to the transmittal of moneys
to be credited to the Exhibition Hall/Auditorium Fund under the
provisions hereof and such default shall have continued for a
period of four (4) days; or
(B) default in the performance or observance of any
other of the covenants, agreements or conditions on the part of
the Manager contained in this Agreement, and such default shall
have continued for a period of ninety (90) days after written
notice thereof, specifying such default, shall have been given
by the City to the Manager; or
(C) if the Manager shall
(1) admit
in writing
its
inability to pay its
debts generally as
they become
due;
or
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5 9 2 6 E
(2) consent to the appointment of a custodian
(as that term is defined in the federal Bankruptcy Code)
for or assignment to a custodian of the whole or any
substantial part of the Manager's property, or fail to
stay, set aside or vacate within ninety (90) days from
the .date of entry thereof any order or decree entered by
a court of competent jurisdiction ordering such
appointment or assignment; or
(3) commence any proceeding or file a petition
under the provisions of the federal Bankruptcy Code for
liquidation, reorganization or adjustment of debts, or
under any insolvency law or other statute or law
providing for the modification or adjustment of the
rights of creditors or fail to stay, set aside or vacate
within ninety (90) days from the date of entry thereof
any order or decree entered by a court of competent
jurisdiction pursuant to an involuntary proceeding,
whether under federal or state law, providing for
liquidation or reorganization of the Manager or
modification or adjustment of the rights of creditors.
The determination of whether an Event of Default has
occurred and is continuing shall be made by the City. The
Manager agrees that it shall have no right to challenge or
question any such determination and agrees to be bound by any
such determination.
-63-
5 9 2 6 E
Section 6.2. Remedies. If an Event of Default has
occurred and is continuing, the City may pursue any available
remedy by suit at law or in equity to enforce the covenants of
the Manager herein, including, without limitation, any remedy
of a secured party under the Texas Uniform Commercial Code,
foreclosure and mandamus, and may pursue such appropriate
judicial proceedings as the City shall deem most effective to
protect and enforce, or aid in the protection and enforcement
of, the covenants and agreements herein. If an Event of
Default has occurred and is continuing, the City may by notice
in writing to the Manager, declare this Agreement terminated,
and in such event, the Manager shall be considered to be a
Tenant -at -Will, and in addition to all other rights and
remedies available to the City under applicable law, the City
shall have all rights and remedies of a landlord under the law
of the State of Texas. The City shall be entitled to immediate
possession of the Exhibition Hall/Auditorium, and it may remove
the Manager and its employees and property, if any, therefrom
without being deemed guilty of any manner of trespass.
No remedy by the terms of this Agreement conferred upon
or reserved to the City is intended to be exclusive of any
other remedy, but each and every such remedy shall be
cumulative and shall be in addition to any other remedy given
to the City hereunder or now or hereafter existing at law or in
equity or by statute. The assertion or employment of any right
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5 9 2 6 E
or remedy hereunder shall not prevent the concurrent assertion
or employment of any other appropriate right or remedy.
No delay or omission to exercise any right or power
accruing upon any Event of Default shall impair any such right
or power or shall be construed to be a waiver of any such Event
of 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 by the City.
No waiver of any default or Event of Default hereunder
shall extend to or shall affect any subsequent default or Event
of Default or shall impair any rights or remedies consequent
thereon.
Section 6.3. Waiver of Stay or Extension Laws. To the
extent that such rights may lawfully be waived, neither the
Manager nor anyone claiming through it or under it shall or
will set up, claim, or seek to take advantage of any stay or
extension laws now or hereafter in force, which may affect the
covenants or agreements contained in this. Agreement and the
Manager, for itself and all who may claim through or under it,
hereby waives, to the extent that it lawfully may do so, the
benefit of all such laws.
Section 6.4. Undertaking for Costs. The Manager and
the City agree that any court may in its discretion, in any
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5926E;
suit by or on behalf of the City for the enforcement of any
right or remedy under this Agreement, assess reasonable costs,
including reasonable attorneys fees, against the Manager in
such suit, having due regard to the merits and good faith of
the claims or defenses made by the Manager.
Section 6.5. Termination of Proceedings. In case the
City shall have proceeded to enforce any right under this
Agreement and such proceedings shall have been discontinued or
abandoned for any reason, or shall have been determined
adversely to rhe City, then and in every such case the Manager
and the City shall, subject to any determination in such
proceedings, be restored to their former positions and rights
hereunder with respect to this Agreement, and all rights,
remedies and powers of the City shall continue as if no such
proceedings had been taken.
[END OF ARTICLE SIX]
-66-
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ARTICLE SEVEN
PURCHASE OPTION
Section 7.1. Conditional Agreement of Purchase and
Sale. Subject in all respects to applicable law regarding
disposition of City property, and to the extent they may
legally so agree, the parties agree that the Manager shall have
an option to purchase the Site and Exhibition Hall/Auditorium
and all other assets and property rights specifically related
to and used or useful in connection with the Exhibition
Hall/Auditorium on any date on the following terms and subject
to the following conditions:
(a) The outstanding Certificates of Obligation shall
at the time of such purchase be scheduled to mature or be
subject to redemption at par plus accrued interest to the date
of redemption with nine (9) months from the date of such
purchase and sale;
(b) The Manager shall have delivered notice, in
writing, of its intent to exercise such option not less than
seventy-five (75) days prior to the proposed date of purchase
and sale (which date shall be set forth in such notice);
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5 9 2 6 E
(c) Following receipt of the Manager's notice
referred to in (b) above, the City shall have, if required to
do so at the time by applicable law, given notice to the
general public of the offer of the land for sale by publishing,
on two separate dates, with such sale to occur at least after
the fourteenth (14th) day after the date of the second
publication, in a newspaper of general circulation in Lubbock
County, Texas, with such publication to include a description
of the land, including its location, and the procedure by which
sealed bids to purchase the land may be submitted, or the City
shall have otherwise complied with then -applicable law (the
intent of this Section 7.01(c) being to require compliance with
Section 272.001(a) of the Local Government Code as in effect on
the Effective Date of this Agreement);
(d) The Manager shall have complied fully with the
applicable bidding requirements and shall have submitted the
highest and best bid received by the City;
(e) The Manager's bid shall be equal to or greater
than the greater of (1) the outstanding principal amount of the
Instruments, (2) the fair market value of the property, or (3)
the depreciated value of the property calculated on a cost
basis of the principal amount of Instruments issued by the
City, amortized over a 20 -year useful life utilizing the
straight line depreciation method, commencing on the Effective
Date of this Agreement; and
-68-
5 9 2 6 E
(f) The Manager shall, at the time of such purchase
and sale, be in full compliance with all covenants,
representations, and obligations under this Agreement, the
Ordinance authorizing the Certificates of Obligation, and any
other document or certificate executed by the Manager in
connection with the issuance of the Certificates of Obligation.
Section 7.2. Preservation of Status of Property. In
order to preserve the status of the property to be purchased
and sold as described above, to avoid adverse tax consequences
to the owners from time to time of the Certificates of
Obligation, and to accomplish the public purpose for which the
Certificates of Obligation are issued, the City agrees that it
will not sell the property to any purchaser unless:
(a) The prospective purchaser is an organization
described in Section 501(c)(3) of the Code and has demonstrated
to the City's satisfaction that were it the Manager on the date
of such purchase and sale, the condition specified in Section
7.01(f) of this Agreement would be satisfied.
(b) The prospective purchaser has agreed in a
covenant running with the land to operate and maintain the
property as an Exhibition Hall/Auditorium in the same or
similar manner as the property has been operated and maintained
while owned by the City for at least five (5) complete years
from the date of such purchase and sale; and
-69-
5 9 2 6 E
(c) The City has obtained an unqualified approving
opinion of Counsel nationally recognized in the field of
municipal bond law that such purchase and sale will not affect
the status of the interest paid or to be paid on the
Certificates of Obligation under federal income tax law.
Section 7.3. Proceeds of Sale. Proceeds from the sale
of the property shall be deposited in the interest and sinking
fund for the Certificates of Obligation.
[END OF ARTICLE SEVEN]
-70-
5 9 2 6 E
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized
officers as of the dates indicated below.
EXECUTED by the City this 28th
(City Seal)
ATTEST:
day of February, 1991
CITY OF LUBBOCK
F r
By: B `'
00 A40��
Mayo
EXECUTED by the Manager this 28th day of February, 1991.
SCIENCE SPECTRUM
By: ,t -. 4n7
esident,
Board of Directors
-71-
5 9 2 6 E
No Text
No Text
8. REQUIREMENTS.
No Text
1.. The following restrictive covenants of record itemized below, but in any Mortgagee Policy of Title Insurance or Mortgagee Title
<.
Policy Binderon Interim Construction Loan, the Company will guarantee that any such restrictive covenants have not been violated
so as to affect, and that a future violation thereof will not affect the validity or priority of the insured mortgage (insert specific
Y recording data or state ,,):Delete this exception
�,The survey exception will be amended except as to shortages in area upon
2 An discre anci , conflicts or sh rta es in area or bou da lines or encr a h t , any overlapping of improvements f
rkn6e o a cutren purvey Jus 111
in € 'e ain�r%`�i<l ri
3. Standby fees and taxes for the year 19 91 and subsequent years, and subsequent assessments for prior years due to change in s
and usage or ownership. not yet due and payable* x
4. Usury or claims of usury. (Mortgagee Policy or Mortgagee Title Policy Binder on Interim Construction Loan only.)
5. Any right of recission contained in any CONSUMERCREDIT PROTECTION or TRUTH -IN -LENDING- laws. (Mortgagee Policy or;
Mortgagee Title Policy on Interim Construction Loan only) a.
Y
6. No materials have been furnished or any labor performed in connection with the construction contemplated hereunder prior
ao the execution, acknowledgment, and delivery of the -lien instrument described under SCHEDULE A hereof, if the land
described under SCHEDULE A forms any part of the homestead of the owner. (May be deleted if satisfactory evidence is
a;
icy Binder on Interim Construction Loan only.) r
furnished before binder is issued.) (Mortgagee Title Policy ;
7 The following lien(s) and all terms provisions and conditions of the mstrument(s) creating or evidencing said liens)
8. (INSERT HERE ALL OTHER SPECIFIC EXCEPTIONS AS TO SUPERIOR LIENS, EASEMENTS, OUTSTANDING MINERAL AND
ROYALTY INTEREVs7S, ETC. n
sA. Twenty foot t20 ) Underground Utility Easement across south end of a
:subject property as shown on Plat with Dedication Deed recorded in Volume`
1566, Page 343, Deed Records, Lubbock County, Texas.
B. An undivided 1/2 interest in all of the oil, gas and other minerals in
on and under the insured premises heretofore reserved in instrument
recorded in Volume 228,.Page .457, Deed Records of Lubbock County, Texas.
C. An undivided .1/4th interest in all of the oil, gas and other minerals
in, on and under the insured premises heretofore conveyed in instrument °^
recorded in Volume 296, Page 35, Deed Records of.Lubbock County, Texas.X:
r°No further search of the oil, 'gas and mineral interest has been made.
ee requirement on Schedule C, Item A
NTINUED ON FOLLOWING PAGE hb<3
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Lawyers Title jnsurance Corporation
This commitment is irnalid unless
l ¢
Ihe onsunnq provisions and SChed
i
National Headquarters —'Richmond, Virginia
,
W,;,":
SCHEDULE B
t
Schedule B of the policy
or policies to be issued will also contain the following exclusions and exceptions:
y
policy will be subject to the Conditions and Stipulations thereof, the terms and conditions of the instrument creating the
�,r* ..The
3 " estate insured, if any,
shown in Schedule A, and to the following matters which will be additional exceptions from the
µ.s . coverage of the poluy
1.. The following restrictive covenants of record itemized below, but in any Mortgagee Policy of Title Insurance or Mortgagee Title
<.
Policy Binderon Interim Construction Loan, the Company will guarantee that any such restrictive covenants have not been violated
so as to affect, and that a future violation thereof will not affect the validity or priority of the insured mortgage (insert specific
Y recording data or state ,,):Delete this exception
�,The survey exception will be amended except as to shortages in area upon
2 An discre anci , conflicts or sh rta es in area or bou da lines or encr a h t , any overlapping of improvements f
rkn6e o a cutren purvey Jus 111
in € 'e ain�r%`�i<l ri
3. Standby fees and taxes for the year 19 91 and subsequent years, and subsequent assessments for prior years due to change in s
and usage or ownership. not yet due and payable* x
4. Usury or claims of usury. (Mortgagee Policy or Mortgagee Title Policy Binder on Interim Construction Loan only.)
5. Any right of recission contained in any CONSUMERCREDIT PROTECTION or TRUTH -IN -LENDING- laws. (Mortgagee Policy or;
Mortgagee Title Policy on Interim Construction Loan only) a.
Y
6. No materials have been furnished or any labor performed in connection with the construction contemplated hereunder prior
ao the execution, acknowledgment, and delivery of the -lien instrument described under SCHEDULE A hereof, if the land
described under SCHEDULE A forms any part of the homestead of the owner. (May be deleted if satisfactory evidence is
a;
icy Binder on Interim Construction Loan only.) r
furnished before binder is issued.) (Mortgagee Title Policy ;
7 The following lien(s) and all terms provisions and conditions of the mstrument(s) creating or evidencing said liens)
8. (INSERT HERE ALL OTHER SPECIFIC EXCEPTIONS AS TO SUPERIOR LIENS, EASEMENTS, OUTSTANDING MINERAL AND
ROYALTY INTEREVs7S, ETC. n
sA. Twenty foot t20 ) Underground Utility Easement across south end of a
:subject property as shown on Plat with Dedication Deed recorded in Volume`
1566, Page 343, Deed Records, Lubbock County, Texas.
B. An undivided 1/2 interest in all of the oil, gas and other minerals in
on and under the insured premises heretofore reserved in instrument
recorded in Volume 228,.Page .457, Deed Records of Lubbock County, Texas.
C. An undivided .1/4th interest in all of the oil, gas and other minerals
in, on and under the insured premises heretofore conveyed in instrument °^
recorded in Volume 296, Page 35, Deed Records of.Lubbock County, Texas.X:
r°No further search of the oil, 'gas and mineral interest has been made.
ee requirement on Schedule C, Item A
NTINUED ON FOLLOWING PAGE hb<3
Commitment No' BG281513
x>4 P .,Erz
3`
J
This commitment is irnalid unless
Ihe onsunnq provisions and SChed
ules A li, and C are attached.
Fnrrn No 42 31 tSrh 10
Commitment No' BG281513
„ - d
INUED FROM SCHEDULE A, BG281513
feet, a chord distance of 21.21 feet to'a pointin the West Right o' Way
,line of Canton Avenue;y K r
THENCE S 0*031 E,`along'the West Right -of -Way line of said Canton Avenue, a
'a distance ;of 406.35 feet to a point of curvature; `
THENCE Southwesterly, around a curve to the right, 'said curve having a `,'1'
radius of ,1,5.00, feet, .a central angle of ,,90°, tangent lengths of 15.004
'feet,,a chord distance of 21.21 feet to apoint in the North Right of Way
line of 74th Street `= _
THENCE S 89,57' W, along'jthe North Right -of -Way line of said 74th Street,';
A distance of 185.00 feet to a point -which is the Southwest corner'of said
Lot 3 -E, -same being the Southeast c8r" -sof said Lot 5-B;
THENCE N 0003' W, 'along the _ ast,"e he -of =said Lot 5-B, a distance of
436.35 feet to the PLACE OF BEGINNING. =izi _ .AlWA
1'
ORIGINAL
a-
3 s J
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3
a ers+title jnsurance
L
Corporacion
A
„ - d
INUED FROM SCHEDULE A, BG281513
feet, a chord distance of 21.21 feet to'a pointin the West Right o' Way
,line of Canton Avenue;y K r
THENCE S 0*031 E,`along'the West Right -of -Way line of said Canton Avenue, a
'a distance ;of 406.35 feet to a point of curvature; `
THENCE Southwesterly, around a curve to the right, 'said curve having a `,'1'
radius of ,1,5.00, feet, .a central angle of ,,90°, tangent lengths of 15.004
'feet,,a chord distance of 21.21 feet to apoint in the North Right of Way
line of 74th Street `= _
THENCE S 89,57' W, along'jthe North Right -of -Way line of said 74th Street,';
A distance of 185.00 feet to a point -which is the Southwest corner'of said
Lot 3 -E, -same being the Southeast c8r" -sof said Lot 5-B;
THENCE N 0003' W, 'along the _ ast,"e he -of =said Lot 5-B, a distance of
436.35 feet to the PLACE OF BEGINNING. =izi _ .AlWA
1'
ORIGINAL
�,� ��, ,�, � __�L+VIVIIVII E IVICIV 1 IVV uu G01J1J
r m w a fr
BG281513 I 03 50,000.00 2/19/9
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�wf4Lawyers T tle jnsurance �or oration E
Headquarters — Richmond Virginia
J' *" `�u COMMITMENT FOR TITLE INSURANCE
SCHEDULE A
icies or Policy to be issues:
Form T-1,,- NER POLICY OF
Form T,1.3 ..,MORTGAGEE TITLE
OTHER
-'Proposed Insurec
he estate or' inter
asement, etc.--ide
ee"Simple ;
i`the land des
or describe)
ebruary '.19,
.E INSURANCE
UBBOCK j
ICF
INTERIM CONSTRUCTION LOAN
or referred to in this Commitment and covered herein:
ic6rd title thereto at the effective date hereof appears to be vested in:
CIENCE SPECTRUM, a Texas Non-profit corporation
C`
T B T'
No 99 1130
K 3
91 7.0'b ' -r`
o clock' _
0,000.00;
K The land referred to in this Commitment is described as followsz ft s >
;.rn!°•z „x s,t r r r. 's,9 -+s'rct m -ry` r 1 ^''tvz '' �y
�, aa?�sl r -'x r ^aka Y s ;;'s.,,. M 4«r wy e ,fl ax Fra shi,, J•;: 4: f ?., ;k
Lot Three` -E (3-E), TIME'S SQUARE Addition to the'City of Lubbock,'' Lubbock
4..Countyir Texas, according to the Map, Plat, and/or Dedication Deed thereof
=recorded in Volume 1566, -Page 343, Deed Records of Lubbock County, Texas,'
',described by metes and bounds as follows:
;BEGINNING at point which is the Northwest corner of Lot 3-E,'TIME'S SQUAR
-' Addition .,'to the City of Lubbock,Lubbock County, Texas, same 'point being
the Northeast corner of Lot 5-B, TIME'S SQUARE Addition and in the South,
-Right-of-Wad line of Loop289,
THENCE N 89 57' E, along the South Right -of -Way line of said Loop '289 a I
'distance 'of 185.00 'feet to a point of curvature to the right;
'THENCE_Southeasterly, around a curve to the right, said curve having a r
r,radius of 15.00 feet, a`central angle of 90', tangent lengths of 15.00*
*CONTINUED ON FOLLOWING PAGE 4 `�-= :, n-. w
live ,. �_x ��� , F rs�... _ .. ` . . ' ; s ... LUBBOCK ABSTRACT & TITLE COMPAN
t`�` `x'+' E , -'x ^�cw ,g >
1"%'�
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a <' Lubbock, .Texas
Countersigned at
a
Authorized Officer or AG9l' g t151:3
Commitment No 4
,1
a
- This is invalid `unless
. •�.'- commitment
Schedule A—Page
;,�,
'Form No. 42-31 (Sch. A)- `=the insuring provisions and Sched-
035-t -037.4200/4 litho in U.S A. ules A, B, and C are attached.
EXHIBITS B AND C
ATTACHED COPY OF TITLE COMMITMENT SHALL SERVE FOR THE LIMITED PURPOSE OF SERVING AS EXHIBITS
B AND C TO THE CONTRACT (SAID EXHIBITS B AND C BEING MENTIONED (N PAGE TWELVE OF THE CONTRACT)
SUCH LIMITED PURPOSE BEING TO SHOW THE LEGAL DESCRIPTION OF THE LAND TO BE CONVEYED WHICH
CONSTITUTES EXHIBIT B AND THE TITLE EXCEPTIONS WHICH CONSTITUTES EXHIBIT C'. ALL OTHER
PROVISIONS OF THE ATTACHED TITLE COMMITMENT (OTHER THAN THE LEGAL DESCRIPTION OF THE LAND
TO BE CONVEYED AND THE TITLE EXCEPTIONS) SHALL HAVE NO APPLICATION TO THIS CONTRACT INSOFAR
AS SERVING AS EXHIBITS B AND C HERETO IS CONCERNED.
c ^
APPROVED•,MAYOR, CITY OF LUBBOCK
T
APPROVED: , PRESIDENT, BOARD OF DIRECTORS OF SCIENCE
SPECTRUM
Based upon and subject to the above and foregoing, and
our examination of such other information and documents,
including provisions of the Constitution and applicable State
of Texas and federal laws as we believe necessary to enable us
to render this opinion, we are of the opinion that under
applicable State of Texas and federal laws:
A. The information in the Official Statement relating
to the Certificates and the Ordinance contained under the
captions of the Official Statement describing such documents
presents a fair and accurate summary of the provisions of the
laws and instruments therein described.
B. The Certificates are exempted securities within the
meaning of Section 3(a)(2) of the Securities Act of 1933, as
amended, and it is not necessary in connecticn with the sale of
the Certificates to the public to register the Certificates
under the Securities Act of 1433, as amended, or to qualify the
Ordinance under the Trust Indenture Act of 1939, as.amended.
C. In the performance of our duties as Bond Counsel for
the City, and our limited part icipat-ior, in the review of the
Official Statement as noted above, no facts came to our
attention which would lead us to believe that, as of this date,
the Official Statement (except for the financial data and
statistical data and forecasts included therein and the
Appendices thereto to which no view is expressed) contains any
untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to
make the statements therein, in the 'Light of the circumstances
under which they were made, not misleading.
This opinion is solely for your benefit in connection
with the referenced transaction and may net be relied on by,
nor copies delivered to, any other person, or used For any
other purpose, without our prior written consent.
Very truly yours,
6 2 S 7 5
FULBRIGHT & .JeAWORSK)
220o Ross AVF-Nuc
SUITE: 2800
MOUyTON
WAbh!NGTON, j,C.
D^LLAs,TEXA3 76201
A
NTO A
SAN ANTONIO
DALLAS
TZ.Lar+ON[:Y!4/6b5•SOOC
NEW YORK
FACStN7tLE:21c/s388-9200
X03 ANGELE'
LONDON
2URiCN
HONG KONG
May 23, 1991
City of Lubbock, Texas
1625 13th Street
Lubbock, Texas 79401
RE; $4,430,000 City of Lubbock, Texas, Combination Tax and
Exhibition Hall/Auditorium (Limited Pledge) Revenue
Certificates of Obligation, Series 1991
----------------------------------------------
Ladies and Gentlemen:
In reference to the original issuance and sale of the
above described certificates of obligations (the
"Certificates") by the City of Lubbock, Texas (the "City"), we
served as Bond Counsel for the City. In our capacity as Bond
Counsel for the City, we prepared the ordinance (the
"Ordinance") authorizing the issuance of the Certificates,
adopted by the City Council of the City on April 24 and April'
25, 1991, which also approved and authorized the distribution
of the Official Statement, dated April 1, 1991 (the "Official
Statement") relating to the Certificates.
Insofar as the Official Statement is concerned, our
review and examination was limited to the information contained
therein under the caption "Bond and Certificate Information
(other than the sub -section "Book -Entry -Only Systeim")" and the
sub -caption "Tax Exemption", and save and except for the
foregoing captions, we have not undertaken -to determine
independently the accuracy, completeness, or fairness of any
other infor*iation, data, or descriptions contained in the
Official Statement, including particularly, but not limited to,
the financial and statistical data included therein,
EXHIBIT A
FORM OF SUPPLEMENTAL OPINION OF BOND COUNSEL MENTIONED ON
PAGE TWELVE OF CONTRACT.
C
APPROVED: A MA)DR. CITY OF LUBBOCK
APPROVED•��&W�d'e,/� PRESIDENT,.BOARD OF DIRECTORS OF SCIENCE
SPECTRUM
LETTER OF AGREEMENT BY SCIENCE SPECTRUM
REGARDING REPAIR AND MAINTENANCE EASEMENT
FOR AND TO CITY OF LUBBOCK FOR BUILDING
AND/OR IMPROVEMENTS IF CONSTRUCTED ON LANDS
LATER CONVEYED TO CITY OF LUBBOCK BY SCIENCE SPECTRUM
The City of Lubbock is in the process of purchasing Lot 3E,
Times Square Addition to the City of Lubbock, Lubbock County,
Texas, from Science Spectrum, a Texas Nonprofit Corporation. If
additional land is needed in addition to said Lot 3E, which addi-
tional land is owned by Science Spectrum abutting and adjoining
said Lot 3E, then such additional land will be conveyed by Science
Spectrum to the City of Lubbock. If the design of the Science
Exhibit Hall calls for such additional land, and in connection
therewith, it is hereby agreed in consideration of the mutual ar-
rangements between Science Spectrum and the City of Lubbock, that
in addition to the additional land needed for such Science Exhibit
Hall (if such land is in fact needed), that Science Spectrum will
grant to the City of Lubbock an easement of ingress, egress, and
regress in, upon, over, along, and across abutting land owned by
Science Spectrum to the extent necessary to repair and maintain the
Science Exhibit Hall improvements constructed on such additional
land (if any) conveyed to the City of Lubbock by Science Spectrum.
EXECUTED this the day ofQL,1-1�, 1991.
SCIENCE SPECTRUM
- BY:
CASSANDRA L. HENRY, Arede