HISD Public Facilities Corp. bond issuance official statement

8/14/2019 HISD Public Facilities Corp. bond issuance official statement

1/185

OFFICIAL STATEMENT

Dated March 9, 2006Ratings:Moodys: AaaS&P: AAASee FINANCIAL GUARANTYINSURANCE And RATINGS herein

NEW ISSUE - Book-Entry Only

In the opinion of Co-Bond Counsel, interest on the Bonds is excludable from gross income for federal income tax purposes under existing law, subject to thematters described under TAX MATTERS herein, and is not included in the alternative minimum taxable income of individuals. See TAX MATTERS for adiscussion of the opinions of Co-Bond Counsel, including the alternative minimum tax on corporations.

$33,600,000HOUSTON INDEPENDENT SCHOOL DISTRICT PUBLIC FACILITY CORPORATION

(a non-profit corporation acting on behalf of the Houston Independent School District,a political subdivision located in Harris County, Texas)

LEASE REVENUE BONDS (FOOD SERVICE WAREHOUSE PROJECT), SERIES 2006

Dated Date: April 1, 2006 Due: September 15, as shown on inside cover

The Houston Independent School District Public Facility Corporation Lease Revenue Bonds (Food Service Warehouse Project), Series 2006 (the Bonds) willbe issued by the Houston Independent School District Public Facility Corporation (the Corporation) as fully registered bonds in denominations of $5,000 orany integral multiple thereof, registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (DTC). DTCinitially will act as securities depository for the Bonds. Purchases of beneficial ownership interests in the Bonds will be made in book-entry form through DTCparticipants, and no physical delivery of the Bond certificates will be made to such purchasers. Defined terms used in this cover page are defined in the text ofthis Official Statement.

Interest on the Bonds will be payable semiannually on March 15 and September 15 in each year, commencing September 15, 2006, by JPMorgan Chase Bank,National Association (the Trustee) to Cede & Co., as registered owner of the Bonds, as described herein. Principal of, premium, if any, and interest on the

Bonds will be payable to Cede & Co., as registered owner of the Bonds, at the designated payment office of the Trustee in Houston, Texas. DTC will beresponsible for distributing the payments of principal of, premium, if any, and interest on the Bonds to the participating members of DTC who will in turn beresponsible for distributing such payments to the owners of beneficial interests in the Bonds. See THE BONDS - BOOK-ENTRY ONLY SYSTEM.

The Bonds are being issued pursuant to a resolution adopted by the Board of Directors of the Corporation under the authority of and in full conformity with thelaws of the State of Texas, particularly the provisions of the Public Facility Corporation Act, Chapter 303, Texas Local Government Code, as amended, and acertain Third Supplemental Trust Indenture Relating to the Houston Independent School District Food Service Warehouse Project, dated as of April 1, 2006(the Trust Indenture), by and between the Corporation and the Trustee, to finance the construction of certain public school facilities for the use and benefit ofthe Houston Independent School District (the District), to-wit: the construction of a new food service warehouse (the Project). A portion of the proceedsof the Bonds will also be used to fund a debt service reserve fund for the Bonds and to pay the costs of issuing the Bonds.

The principal of, premium, if any, and interest on the Bonds are payable from rental payments to be made by the District (the Rental Payments) to theCorporation pursuant to a certain Lease with an Option to Purchase dated as of April 1, 2006 (the Lease), as authorized by Section 271.004 of the TexasLocal Government Code, as amended. The Rental Payments are due at such times and in such amounts as will be required to pay the principal of, premium, ifany, and interest on the Bonds, as and when the same become due. As additional security for the Bonds, the Corporation will grant to the Trustee for thebenefit of the registered owners of the Bonds (i) a first mortgage lien on the real property relating to the Project and will assign and pledge the Corporationsinterest in the leases, rents, and certain other benefits from the Project, pursuant to a Mortgage and Security Agreement, and (ii) a first priority purchase moneysecurity interest in the personal property portion of the Project, pursuant to the Mortgage and Security Agreement. THE OBLIGATION OF THE DISTRICT TOMAKE RENTAL PAYMENTS IS A CURRENT EXPENSE, PAYABLE SOLELY FROM FUNDS TO BE ANNUALLY APPROPRIATED BY THE DISTRICT FOR SUCH USEFROM (I) ANY LAWFULLY AVAILABLE FUNDS APPROPRIATED BY THE TEXAS LEGISLATURE, WHICH UNDER CURRENT LAW IS LIMITED TO GUARANTEEDYIELD PROGRAM TIER ONE FUNDS,(II) ANY UNINTENDED SURPLUS MAINTENANCE TAX REVENUES, AND (III) UPON RECEIPT OF AN APPROVING OPINIONOF NATIONALLY RECOGNIZED CO-BOND COUNSEL, ANY OTHER FUNDS HEREAFTER DETERMINED TO BE AVAILABLE WITH RESPECT TO ANY PAYMENTOBLIGATED OR PERMITTED UNDER THE LEASE AS A RESULT OF A FINAL, NONAPPEALABLE JUDGMENT OF A COURT OF COMPETENT JURISDICTION,LEGISLATION HEREAFTER ENACTED, OR OTHER CHANGE IN STATE LAW.REMEDIES AVAILABLE UPON A FAILURE OF THE DISTRICT TO APPROPRIATE ORPAY RENTAL PAYMENTS ARE LIMITED TO TERMINATION OF THE DISTRICTS LEASEHOLD INTEREST, THE RIGHT TO TAKE POSSESSION AND CONTROL OFTHE PROJECT, AND THE RIGHT TO SELL OR LEASE THE PROJECT UPON FORECLOSURE UNDER THE MORTGAGE AND SECURITY AGREEMENT. NEITHERTHE FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OF TEXAS, THE DISTRICT, OR ANY OTHER POLITICAL SUBDIVISION OF THE STATE OFTEXAS IS PLEDGED TO THE PAYMENT OF THE PRINCIPAL OF, PREMIUM, IF ANY, OR INTEREST ON THE BONDS.

THE CORPORATIONS OBLIGATION WITH RESPECT TO THE PAYMENT OF THE PRINCIPAL OF, PREMIUM, IF ANY, AND INTEREST ON THE BONDS IS ASPECIAL, LIMITED, AND NON-RECOURSE OBLIGATION PAYABLE SOLELY FROM THE RENTAL PAYMENTS PAYABLE BY THE DISTRICT PURSUANT TO THELEASE AND FROM PROCEEDS FROM THE SALE OR OTHER LEASE OF THE PROJECT. THE CORPORATION HAS NO AUTHORITY TO LEVY TAXES. THE BONDSDO NOT CONSTITUTE AN OBLIGATION, EITHER SPECIAL, GENERAL, OR MORAL, OF THE DISTRICT, THE STATE, OR ANY OTHER POLITICAL SUBDIVISIONTHEREOF.

See Maturity and Pricing Schedule on the inside cover

Payment of the principal of and interest on the Bonds when due will be insured by a financial guaranty insurance policy to be issuedby Ambac Assurance Corporation (Ambac) simultaneously with the delivery of the Bonds. See FINANCIAL GUARANTYINSURANCE.

THE PURCHASE OF THE BONDS INVOLVES A DEGREE OF RISK. SEE RISKFACTORS.

The Bonds are subject to redemption upon the Districts exercise of a purchase option and at the Corporations option on the dates, at the prices, and in theamounts described herein. See THE BONDS - REDEMPTION.

The Bonds are offered for sale by the Initial Purchaser, when, as, and if issued by the Corporation, subject to the approving opinion of the Attorney General ofthe State of Texas as to validity and the opinion of Andrews Kurth LLP, Houston, Texas and Burney & Foreman, Co-Bond Counsel as to validity and taxexemption. Certain matters will be passed upon for the Corporation by Andrews Kurth LLP, Houston, Texas and Burney & Foreman, Houston, Texas. It isexpected that delivery of the Bonds will be made through the facilit ies of DTC on or about April 6, 2006.


2/185

i




MATURITY SCHEDULE

Interest Initial Interest Initial

Principal Rate Yield(a)

Principal Rate Yield(a)

425,000$ 2006 4.250 % 3.370 % 442404 BR9 1,260,000$ 2017(c)

4.250 % 4.110 % 442404 CC1

400,000 2007 4.250 3.420 442404 BS7 1,325,000 2018(c)

4.125 4.200 442404 CD9

405,000 2008 4.250 3.480 442404 BT5 1,385,000 2019(c)

4.125 4.300 442404 CE7

880,000 2009 4.250 3.530 442404 BU2 1,450,000 2020(c)

4.250 4.390 442404 CF4

915,000 2010 4.250 3.580 442404 BV0 1,515,000 2021(c)

4.375 4.460 442404 CG2

955,000 2011 4.250 3.690 442404 BW8 1,585,000 2022(c)

4.500 4.490 442404 CH0

995,000 2012 4.250 3.780 442404 BX6 1,660,000 2023(c)

4.500 4.520 442404 CJ6

1,045,000 2013 5.500 3.860 442404 BY4 1,735,000 2024(c)

4.500 4.550 442404 CK3

1,095,000 2014 5.500 3.920 442404 BZ1 1,815,000 2025(c)

4.500 4.580 442404 CL1

1,150,000 2015 5.500 3.970 442404 CA5 1,900,000 2026(c)

4.500 4.590 442404 CM9

1,205,000 2016 5.500 4.020 442404 CB3 1,985,000 2027(c)

4.500 4.600 442404 CN7

CUSIP(b)

Maturity

(September 15)

Maturity

(September 15)CUSIP(b)

$6,515,0004.625%TERM BONDS DUE SEPTEMBER 15,2030(c)PRICED TO YIELD 4.650%(a) CUSIP442404CR8(b)

(Accrued Interest from April 1, 2006 to be added)

(a) The initial yields are established by and are the sole responsibility of the Initial Purchaser, and may subsequently be changed.

(b) CUSIP Numbers have been assigned to the Bonds by the CUSIP Service Bureau and are included solely for the convenience of the purchasers of theBonds. Neither the District, the Corporation nor the Initial Purchaser shall be responsible for the selection or correctness of the CUSIP Numbers set forth

herein.

(c) The Corporation reserves the right, at its option, to redeem Bonds having stated maturities on and after September 15, 2017, in whole or part in principalamounts of $5,000 of integral multiples thereof, on September 15, 2016, or any date thereafter, at the par value thereof plus accrued interest to the date of

redemption. See THE BONDS REDEMPTION.


3/185

ii

HOUSTONINDEPENDENTSCHOOLDISTRICTPUBLICFACILITYCORPORATIONBOARDOFDIRECTORS

President............................................................................................................................................................... Lawrence Marshall

Director .......................................................................................................................................................................Leonel Castillo

Director ..........................................................................................................................................................................Diana Dvila

HOUSTON INDEPENDENT SCHOOL DISTRICTBOARD OF EDUCATION

President.........................................................................................................................................................................Diana Dvila

First Vice-President......................................................................................................................................... Manuel Rodriguez, Jr.

Second Vice-President .............................................................................................................................................Harvin C. Moore

Secretary ...........................................................................................................................................................Arthur M. Gaines, Jr.

Assistant Secretary......................................................................................................................................................... Greg Meyers

Member ......................................................................................................................................................................Dianne Johnson

Member ................................................................................................................................................................. Kevin H. Hoffman

Member ................................................................................................................................................................ Lawrence Marshall

Member ..............................................................................................................................................................Natasha M. Kamrani

CERTAIN APPOINTED OFFICIALS

Superintendent of Schools...............................................................................................................................Dr. Abelardo Saavedra

Chief Financial Officer ............................................................................................................................................. Melinda Garrett

Controller .................................................................................................................................................................Kenneth Huewitt

General Counsel, Office of General Counsel ............................................................................................... Elneita Hutchins-Taylor

Finance Attorney.........................................................................................................................................................Donald Boehm

CONSULTANTS AND ADVISORS

Co-Bond Counsel ............................................................................................................................................... Andrews Kurth LLP

Houston, Texas

Burney & Foreman

Houston, Texas

Co-Financial Advisor .................................................................................................................................First Southwest Company

Houston, Texas

Apex Securities, Inc.

Houston, Texas


4/185

iii

This Official Statement, which includes the cover page and appendices, does not constitute an offer to sell the Bonds in any jurisdiction toany person to whom it is unlawful to make such offer in such jurisdiction. No dealer, salesman, or other person has been authorized to giveany information or to make any representations other than those contained in this Official Statement in connection with the offering of the

Bonds, and, if given or made, such information or representation must not be relied upon.

This Official Statement is not to be construed as a contract with the purchasers of the Bonds. Statements contained in this Official Statement

which involve estimates, forecasts, or matters of opinion, whether or not expressly so described herein, are intended solely as such and are

not to be construed as a representation of facts.

The information set forth herein has been furnished by the District and the Corporation and includes information obtained from other

sources which are believed to be reliable, but it is not guaranteed as to accuracy or completeness and is not to be construed as a

representation by the Initial Purchaser. The information and expressions of opinions contained herein are subject to change without notice

and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that

there has been no change in the affairs of the District or the Corporation since the date hereof.

The Bonds are exempt from registration with the Securities and Exchange Commission and consequently have not been registered therewith.

The registration, qualification, or exemption of the Bonds in accordance with applicable securities law provisions of the jurisdictions in

which these securities have been registered, qualified, or exempted should not be regarded as a recommendation thereof.

In connection with the offering of the Bonds, the Initial Purchaser may overallot or effect transactions that stabilize or maintain the

market price of the Bonds at a level above that which might otherwise prevail in the open market. Such stabilizing, if commenced, may

be discontinued at any time.

TABLE OF CONTENTS

INTRODUCTION.................................................................1

PLAN OF FINANCING.......................................................2

RISK FACTORS...................................................................3

THE BONDS .........................................................................7

USES OF FUNDS................................................................10

DEBT SERVICE REQUIREMENTS OF THECORPORATION......................................................10

TRUST ESTATE........................................................................11RENTAL PAYMENTS ................................................................11MORTGAGE AND SECURITY AGREEMENT ...............................11RESERVE ACCOUNT ................................................................11REMEDIES...............................................................................11ADDITIONAL OBLIGATIONS ....................................................12

FINANCIAL GUARANTY INSURANCE ......................12PAYMENT PURSUANT TO FINANCIAL GUARANTY INSURANCE

POLICY .........................................................................12AMBAC ASSURANCE CORPORATION .......................................13INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE....14

RESERVE ACCOUNT SURETY BOND........................14

THE PROJECT ..................................................................14

THE CORPORATION ......................................................15

THE DISTRICT..................................................................15

FINANCIAL AND OPERATING INFORMATION FORTHE DISTRICT........................................................23

TIER ONE ALLOTMENTS .........................................................23UNDESIGNATED FUND BALANCES ..........................................24UNDESIGNATED GENERAL FUND BALANCE HISTORY.............24AVERAGE DAILY ATTENDANCE..............................................24AVERAGE DAILY ATTENDANCE HISTORY...............................24

TAXABLE ASSESSED VALUATIONS BY CATEGORY ................. 25TAX RATE,LEVY AND COLLECTION HISTORY ....................... 25TEN LARGEST TAXPAYERS .................................................... 26DEBT INFORMATION............................................................... 26AUTHORIZED BUT UNISSUED TAX-SUPPORTED BONDS ......... 27OTHER FINANCIAL MATTERS................................................. 29

TAX MATTERS................................................................. 30DISCOUNT BONDS .................................................................. 31PREMIUM BONDS ................................................................... 31

LITIGATION ..................................................................... 32

LEGAL MATTERS........................................................... 32

CONTINUING DISCLOSURE OF INFORMATION.. 32ANNUAL REPORTS ................................................................. 32MATERIAL EVENT NOTICES ................................................... 33AVAILABILITY OF INFORMATION FROM NRMSIRS AND SID 33LIMITATIONS AND AMENDMENTS .......................................... 33COMPLIANCE WITH PRIOR UNDERTAKINGS ........................... 34

RATINGS............................................................................ 34

INITIAL PURCHASER.................................................... 34

CERTIFICATION............................................................. 34

REGISTRATION AND QUALIFICATION OF BONDSFOR SALE ................................................................ 34

THE BONDS AS LEGAL INVESTMENTS IN TEXAS34MISCELLANEOUS........................................................... 35

APPENDICESSELECTED PROVISIONS OF THE FINANCING DOCUMENTS ......AANNUAL FINANCIAL REPORT ...............................................BFORM OF CO-BOND COUNSELS OPINION .............................CSPECIMEN FINANCIAL GUARANTY INSURANCE POLICY ........D


5/185

1

OFFICIAL STATEMENT

RELATING TO




INTRODUCTION

This Official Statement, which includes the preceding pages and the Appendices hereto, has been prepared by the HoustonIndependent School District Public Facility Corporation, a Texas nonprofit corporation (the Corporation) to provide certaininformation regarding the issuance by the Corporation of its Lease Revenue Bonds (Food Service Warehouse Project), Series2006 (the Bonds). Capitalized terms used in this Official Statement and not otherwise defined herein have the meaningsassigned to such terms in APPENDIX A -SELECTED PROVISIONS OF THE FINANCING DOCUMENTS - DEFINITIONS.

The Bonds are being issued pursuant to a resolution adopted by the governing body of the Corporation under the authority of and infull conformity with the laws of the State of Texas, particularly the provisions of Chapter 303, Texas Local Government Code (thePublic Facility Corporation Act), a Master Indenture and the Third Supplemental Trust Indenture, to finance the Project for thebenefit and use of the District. The Corporation will lease the Project to the District pursuant to the Lease with an Option to PurchaseRelating to the Houston Independent School District Food Service Warehouse Project (the Lease). Under the Lease, the District isrequired to make Rental Payments semiannually, commencing September 15, 2006, in consideration of the lease of the Project,which Rental Payments include principal and interest to be distributed semiannually to the Bondholders. The Corporation will assignits interest in the Lease, the Rental Payments, and the Project to the Trustee for the benefit of the Bondholders pursuant to a Deed of

Trust, Assignment of Rents and Leases and a Mortgage and Security Agreement, dated as of the date of delivery of the Bonds (theMortgage and Security Agreement), by and between the Corporation and the Trustee. The Corporation will also grant a firstpriority purchase money security interest in the personal property portion of the Project pursuant to the Mortgage and SecurityAgreement.

The Corporation and the Trustee have entered into a Master Trust Indenture as supplemented by a First Supplemental Indentureand a Second Supplemental Indenture, each dated as of May 1, 1998. Pursuant to the First Supplemental Indenture, theCorporation issued its $46,246,107.60 Lease Revenue Bonds (Cesar E. Chavez High School), Series 1998A. Pursuant to theSecond Supplemental Indenture, the Corporation issued its $47,999,984.95 Lease Revenue Bonds (West Side High School),Series 1998B. See DEBT SERVICE REQUIREMENTS OF THE CORPORATION. The Bonds will be issued pursuant to aThird Supplemental Indenture (the Trust Indenture).

THE PURCHASE OF THE BONDS INVOLVES A DEGREE OF RISK. SEE RISKFACTORS.

THE CORPORATIONS OBLIGATION WITH RESPECT TO THE PAYMENT OF THE PRINCIPAL OF , PREMIUM, IF ANY, AND INTEREST ON

THE BONDS IS A SPECIAL, LIMITED, AND NON-RECOURSE OBLIGATION PAYABLE SOLELY FROM THE RENTAL PAYMENTS PAYABLEBY THE DISTRICT PURSUANT TO THE LEASE AND FROM PROCEEDS FROM THE SALE OR OTHER LEASE OF THE PROJECT. THECORPORATION HAS NO AUTHORITY TO LEVY TAXES. THE BONDS DO NOT CONSTITUTE AN OBLIGATION, EITHER SPECIAL,GENERAL, OR MORAL, OF THE DISTRICT, THE STATE, OR ANY OTHER POLITICAL SUBDIVISION THEREOF.

THE OBLIGATION OF THE DISTRICT TO MAKE RENTAL PAYMENTS IS A CURRENT EXPENSE, PAYABLE SOLELY FROM FUNDS TO BEANNUALLY APPROPRIATED BY THE DISTRICT FOR SUCH USE FROM (I) ANY LAWFULLY AVAILABLE FUNDS APPROPRIATED BY THETEXAS LEGISLATURE, WHICH UNDER CURRENT LAW IS LIMITED TO GUARANTEED YIELD PROGRAM TIER ONE FUNDS,(II) ANYUNINTENDED SURPLUS MAINTENANCE TAX REVENUES, AND (III) UPON RECEIPT OF AN APPROVING OPINION OF NATIONALLYRECOGNIZED CO-BOND COUNSEL, ANY OTHER FUNDS HEREAFTER DETERMINED TO BE AVAILABLE WITH RESPECT TO ANY PAYMENTOBLIGATED OR PERMITTED UNDER THE LEASE AS A RESULT OF A FINAL, NONAPPEALABLE JUDGMENT OF A COURT OF COMPETENT

JURISDICTION, LEGISLATION HEREAFTER ENACTED, OR OTHER CHANGE IN STATE LAW. REMEDIES AVAILABLE UPON A FAILURE OF THEDISTRICT TO APPROPRIATE OR PAY RENTAL PAYMENTS ARE LIMITED TO TERMINATION OF THE DISTRICTS LEASEHOLDINTEREST, THE RIGHT TO TAKE POSSESSION AND CONTROL OF THE PROJECT, AND THE RIGHT TO SELL OR LEASE THE PROJECTUPON FORECLOSURE UNDER THE MORTGAGE AND SECURITY AGREEMENT. THE LEASE AND THE OBLIGATIONS OF THE DISTRICTTHEREUNDER DO NOT CONSTITUTE A PLEDGE, A LIABILITY, OR A CHARGE UPON THE FUNDS OF THE DISTRICT AND DO NOTCONSTITUTE A DEBT OR GENERAL OBLIGATION OF THE STATE OF TEXAS, THE CORPORATION, THE DISTRICT, OR ANY OTHERPOLITICAL SUBDIVISION OF THE STATE OF TEXAS. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE STATE OFTEXAS, THE DISTRICT, OR ANY OTHER POLITICAL SUBDIVISION OF THE STATE OF TEXAS IS PLEDGED TO THE PAYMENT OF THEPRINCIPAL OF, PREMIUM, IF ANY, OR INTEREST ON THE BONDS. THE CORPORATION HAS NO TAXING AUTHORITY.

The proceeds from the sale of the Bonds will be deposited into the Project Acquisition Account created by the Trust Indentureand used, together with the interest earnings thereon, to pay, or reimburse the Corporation for, payment of Project Costs,including costs (i) related to issuance of the Bonds, (ii) of construction of the Project, and (iii) to purchase a Reserve Accountsurety bond for the Bonds. On the Closing Date, there shall be deposited into the Payment Account the amount of accruedinterest to pay a portion of the interest due on the Bonds on September 15, 2006.

There follows in this Official Statement descriptions of the Plan of Financing and the Bonds and certain information regardingthe District and its finances. Such descriptions do not purport to be comprehensive or definitive. All descriptions of documents


6/185

2

contained herein are only summaries and are qualified in their entirety by reference to each such document, copies of which maybe obtained from the District upon payment of reasonable copying and delivery charges. All references to the Bonds arequalified in their entirety by reference to the definitive forms thereof and the information with respect thereto contained in theTrust Indenture.

PLAN OF FINANCING

The Project is being financed pursuant to Section 271.001 et. seq., Texas Local Government Code, as amended (the PublicProperty Finance Act), Chapter 303, Texas Local Government Code, as amended (the Public Facility Corporation Act) andSection 42.101 et. seq., Texas Education Code, as amended (the Tier One Act).

Section 271.004 of the Public Property Finance Act authorizes school districts to acquire real property and improvements byentering into lease purchase contracts provided that a notice of intent to enter into such contract is published at least 60 daysprior to execution of the contract. A notice of intention to enter into a lease purchase agreement pursuant to the Public PropertyFinance Act was published on January 16, 2005. The District approved an order authorizing the publication on January 13,2005. The Act imposes a duty upon the District to obtain the approval of its electorate if a valid petition containing thesignatures of at least five percent of the registered voters of the District is filed with the Board of Education of the District withinsixty (60) days of the date of publication of the notice of intent. No petition was presented within the required time.

The Public Facility Corporation Act authorizes the creation and utilization by school districts (and other governmental entities)of public facility corporations to issue bonds to provide for the acquisition, construction, rehabilitation, renovation, repair,equipping, furnishing, and placing in service of public facilities of its governmental sponsor. The Public Facility CorporationAct further authorizes school districts (and other governmental entities) to incur obligations in favor of public facilitycorporations to serve as security for the bonds to be issued by such corporations. The Corporation was formed pursuant to thePublic Facility Corporation Act to issue bonds, and to enter into leases, as lessor, with the District, as lessee, in order to financethe acquisition and construction of school facilities.

One of Districts primary sources of funds for making the Rental Payments under the Lease, which will in turn be used to makepayments of principal and interest on the Bonds, is revenues to be received by the District from biennial legislativeappropriations pursuant to the Tier One Act. Texas law provides a two-tiered education finance structure known as theFoundation School Program. The Tier One Act provides that the purpose of Tier One is to guarantee sufficient financing for allschool districts to provide a basic program of education that meets accreditation and other applicable legal standards. For eachstudent in average daily attendance a district is entitled to a basic allotment of $2,537, which is subject to various adjustmentsand special allotments to reflect variations and actual costs. To be eligible for the program, a district must provide its local shareof funding, defined as the amount produced when an effective tax rate of $0.86 per $100 valuation is applied to the taxable valueof property in the district for the prior tax year. To the extent that the $0.86 effective tax rate fails to produce the adjustedallotment from the districts own tax base, the State of Texas will fund the difference.

Another of the Districts sources of funds for making the Rental Payments under the Lease, which will be used to make

payments of principal and interest on the Bonds, is unintended surplus maintenance tax funds. Since these funds areunintended, these funds cannot be budgeted by the District, and, as such, there can be no assurance that such funds, if any, willbe available for making the Rental Payments. For more information on unintended surplus maintenance tax funds, seeFINANCIAL AND OPERATING INFORMATION FOR THE DISTRICT.

To provide funds for the acquisition and construction of the Project, the District and the Corporation will enter into the Leasewhereby the Corporation will agree to lease the Project to the District, and the District will agree to pay semiannual RentalPayments sufficient to pay principal, interest, and redemption premium, if any, on the Bonds when due. The District mayterminate the Lease by failing to appropriate money in any fiscal year for this purpose (see RISK FACTORS Nonappropriation). For a summary of certain provisions of the Lease, see APPENDIX A SELECTED PROVISIONS OFTHE FINANCING DOCUMENTS - SUMMARY OF CERTAIN PROVISIONS OF THE LEASE.

The Bonds are being issued pursuant to a resolution adopted by the Board of Directors of the Corporation and the TrustIndenture to finance the acquisition and remodeling of the Project. See THE PROJECT. A portion of the proceeds of theBonds will also be used to pay the costs of issuing the Bonds and to fund the reserve account. For more information on the TrustIndenture, see APPENDIX A SELECTED PROVISIONS OF THE FINANCING DOCUMENTS - S UMMARY OF CERTAINPROVISIONS OF THE INDENTURE.


7/185

3

To secure its obligations under the Trust Indenture, the Corporation will grant a first mortgage lien on and first deed of trust liento the real property portion of the Project and will assign and pledge the Corporations interest in the leases, rents, issues, profits,revenues, income, receipts, money, rights, and benefits of and from the Project for the use and benefit of the Trustee, on behalfof the registered owners of the Bonds, pursuant to the Mortgage and Security Agreement. The Corporation will also grant to theTrustee a first priority security interest in the machinery, equipment, furnishings, or other personal property acquired by theCorporation with the proceeds of the Bonds, and at any time installed or located at the Project site, and in the accounts,documents, chattel paper, instruments, and general intangibles arising in any manner from the Corporations ownership andoperation of the Project pursuant to the Mortgage and Security Agreement.

The Trust Indenture, the Lease, the Mortgage and Security Agreement, the Assignment of Construction Management Contract

(discussed below), and the Assignment of Architect Contract and Plans and Specifications (discussed below), are collectivelyreferred to herein as the Financing Documents. See RISK FACTORS herein.

RISK FACTORS

THE PURCHASE OF THE BONDS IS SUBJECT TO CERTAIN RISKS. EACH PROSPECTIVE INVESTOR IN THEBONDS IS URGED TO READ THIS OFFICIAL STATEMENT IN ITS ENTIRETY INCLUDING ITS APPENDICES.PARTICULAR ATTENTION SHOULD BE GIVEN TO THE FACTORS DESCRIBED BELOW WHICH, AMONGOTHERS, COULD AFFECT THE PAYMENT OF DEBT SERVICE ON THE BONDS, AND WHICH COULD ALSOAFFECT THE MARKETABILITY OF THE BONDS TO AN EXTENT THAT CANNOT BE DETERMINED.

NONAPPROPRIATION . . . Except to the extent that excess Bond proceeds are legally available, the Bonds and the interest thereonare payable solely from Rental Payments and other payments paid or payable by the District from and after the date of the Lease,and other income, charges, and funds realized from the lease, sale, transfer, or other disposition of the Project, together with allfunds and investments in all accounts established under the Trust Indenture, and all funds deposited with the Trustee pursuant tothe Financing Documents. The obligation of the District to pay Rental Payments is limited to those funds appropriated by theDistrict from (i) money appropriated biennially by the Legislature of the State that may lawfully be used with respect to anypayment obligated or permitted under the Lease, which under current law is limited to the Basic Allotment portion of Tier OneFunds, (ii) any unintended surplus maintenance tax funds of the District at the end of each fiscal year after payment of allmaintenance and operating expenses of the District for that fiscal year, and (iii) upon receipt of an approving opinion ofnationally recognized Co-Bond Counsel, any other funds hereafter determined to be available with respect to any paymentobligated or permitted under the Lease as a result of a final, nonappealable judgment of a court of competent jurisdiction,legislation hereafter enacted, or other change in State law. The funds described in (i), (ii), and (iii) together are referred to asAvailable Funds. See STATE AND LOCAL FUNDING OF SCHOOL DISTRICTS IN TEXAS. If Available Fundssufficient to pay the Rental Payments during the succeeding fiscal year are not appropriated by the District, the Lease willautomatically terminate at the end of the fiscal year for which sufficient funds have been appropriated. In such event, theDistrict must immediately, upon expiration of such fiscal year, surrender possession and control of the Project to the Trustee. Noassurances may be given that the Trustee will be able to manage or sell the Project in a manner that will produce sufficientrevenues therefrom to pay debt service on the Bonds.

There can be no assurance that the District will annually appropriate sufficient funds to pay the Rental Payments due in anygiven fiscal year. Accordingly, the likelihood that there will be sufficient funds to pay the principal of, premium, if any, andinterest on the Bonds is dependent upon certain facts which are beyond the control of the registered owners, including (a) thecontinuing need of the District for the Project, (b) the ability of the District to obtain funds from the Texas Legislature to payobligations associated with the Lease, (c) the demographic and economic conditions within the service area of the District, (d)the value, if any, of the Project in a sale instituted by the Trustee pursuant to the Trust Indenture and the Mortgage and SecurityAgreement, and (e) the rental value, if any, of the Project in the event the Trustee re-leases the Project to a third party or to theDistrict pursuant to an operating lease.

THE DISTRICT HAS NO OBLIGATION TO ADOPT OR MAINTAIN A BUDGET TO AVOID A TERMINATION OF THELEASE OR TO MAKE RENTAL PAYMENTS SUBSEQUENT TO THE TERMINATION OF THE LEASE UPON THEOCCURRENCE OF AN EVENT OF NON-APPROPRIATION. IF THE DISTRICT FAILS TO APPROPRIATE SUFFICIENTFUNDS TO MAKE RENTAL PAYMENTS, IT IS PROBABLE THAT THERE WILL NOT BE SUFFICIENT FUNDS TOPAY THE BONDS, WHEN DUE.

CONTINUED STATE APPROPRIATION OF TIER ONE FUNDS . . . Since 1989 State funding of education has been challenged onconstitutional grounds requiring the State Legislature to enact several funding programs, each of which differed in the manner inwhich State and local funds have been allocated to school districts. There is no assurance that the Texas Legislature will notchange the current system of funding for school districts in Texas and, thereby, adversely affect the Districts anticipated TierOne Funds. (See STATE AND LOCAL FUNDING OF SCHOOL DISTRICTS IN TEXAS and CURRENT SCHOOLFINANCE SYSTEM.)


8/185

4

DISTRICTS FUTURE LEVEL OF TIER ONE FUNDS . . . The money which may lawfully be used by the District for the RentalPayments is primarily from the Basic Allotment portion of its Tier One Funds received from the State.

Tier One Funds are provided to school districts based on a formula that includes, among other factors, the following primaryfactors relating to the District: (1) tax rate, (2) average daily attendance, (3) tax collection rate, and (4) assessed valuation ofproperty. A significant decrease in items (1), (2), or (3) or a significant increase in item (4) could have a material adverse affecton the amount of Tier One Funds allocated to the District and, therefore, on its ability to make the Rental Payments. For moreinformation on Tier One Funds, See STATE AND LOCAL FUNDING OF SCHOOL DISTRICTS IN TEXAS.

The Basic Allotment portion of Tier One Funds is equal to the State-funded portion of Tier One for the District minus amountsattributable to the special allotments received by the District for special education, compensatory education, bilingual education,career and technology, transportation, and the gifted and talented program (the Basic Allotment).

POSSIBLE FUTURE CHANGES TO THE TEXAS PUBLIC SCHOOL FINANCE SYSTEM . . . On November 22, 2005, the Texas SupremeCourt released its opinion in litigation styled Neeley v. West Orange-Cove Consolidated ISD et al. (West Orange-Cove), inwhich the Texas public school finance system (the Finance System) was held unconstitutional in certain respects. The TexasSupreme Courts order in West Orange-Cove affirmed a lower courts injunction prohibiting the distribution of certain Statefunds under the Finance System. The effective date of the injunction was postponed by the Texas Supreme Court from October1, 2005 to June 1, 2006 to allow the State time to consider structural changes to the Finance System, and to allow the FinanceSystem time to adjust to any such changes. The Governor has announced his intention to call a special legislative session duringwhich the State Legislature will consider public school finance legislation, but no date has been set for the start of that specialsession. The District can make no representation or prediction concerning how or if the Finance System may be changed in aspecial session of the State Legislature or whether the Finance System would be constitutional if legislative changes are enacted.Changes to the Finance System could substantially adversely affect the financial condition of the District. If the State Legislaturefails to enact remedial legislation before June 1, 2006, or the Texas Supreme Court does not stay the injunction, State funding ofthe Districts operations will be enjoined, and the Districts financial condition and prospects will be materially adverselyaffected. See STATE AND LOCAL FUNDING OF SCHOOL DISTRICTS IN TEXAS and CURRENT PUBLIC SCHOOLFINANCE SYSTEM herein.

THE EFFECT OF S.B.4 ON THE DISTRICT . . . During the 1999 Legislative Session, the Texas Legislature enacted Senate Bill 4(S.B. 4) See FINANCIAL AND OPERATING INFORMATION FOR THE DISTRICT Ad Valorem Tax Information.Pursuant to amendments made by S.B. 4 to Section 42.301 of the Texas Education Code, the guaranteed yield component of theFoundation School Program (Tier Two) is unavailable for the payment of debt service or capital outlay, including payments onlease-purchase agreements. However, as clarified in an All Bond Counsel letter from the Public Finance Division of the TexasAttorney General dated July 21, 1999, the Basic Allotment portion of Tier One Funds is available to make lease purchasepayments. There are still additional questions relating to S.B.4 which remain to be addressed and the full impact of S.B. 4 on theDistrict cannot be fully assessed at this time. For a further discussion of State funding for local school districts, see CURRENTSCHOOL FINANCE SYSTEM. The Districts financial condition, results of operations, and tax assessment and collection

experience have resulted from school finance systems that existed under predecessor statutes. In light of the recent enactment ofS.B. 4, all of the current and historical financial data included herein may not be indicative of the Districts future financialcondition.

CHANGES IN DEMOGRAPHIC AND ECONOMIC CONDITIONS . . . Changes in student population and economic, social, or otherconditions will affect demographics of the District and may reduce the Districts ability, need, or willingness to utilize theProject. In such event, the District may elect to terminate the Lease by failing to appropriate funds to make Rental Paymentsunder the Lease. For a description of the remedies of the Trustee in such case, see APPENDIX A SELECTED PROVISIONSOF THE FINANCING DOCUMENTS - SUMMARY OF CERTAIN PROVISIONS OF THE TRUST INDENTURE.

COMPLETION/CONSTRUCTION RISKS . . . The construction of the Project will be subject to risks typically associated withbuilding construction. These risks could have a material adverse effect on the willingness of the District to appropriate moneyfor the Project. The Corporation will enter into a construction management contract (the Construction Management Contract)wherein the Construction Administrator has agreed to provide the construction of the Project at a stipulated guaranteed maximum

sum. Performance under the Construction Management Contract and payment of obligations thereunder will be supported bypayment and performance bonds; however, enforcement of such bonds can take a significant amount of time. See THEPROJECT DESIGN AND CONSTRUCTION.


9/185

5

PREPAYMENT RISK . . . On each Bond Payment Date during the Term of the Lease beginning on September 15, 2006, theDistrict has the option to purchase the Corporations interest in the Project for an amount equal to the Purchase Option Price onsuch date as provided in the Lease. In such event, the Bonds may be redeemed prior to their final maturity and Bondholders maynot receive the full yield-to-maturity on their Bonds.

DAMAGE OR DESTRUCTION RISK . . . If all or a portion of the Project is damaged, destroyed or condemned and the Net Proceedsof any insurance or condemnation award are sufficient, the Districts judgment, to repair or replace the Project, the District isrequired to use such Net Proceeds for such purposes and the District is obligated to continue to pay the Rental Payments fromAvailable Funds. If the Net Proceeds are insufficient, in the Districts judgment, to pay in full the cost of any repair, restorationor replacement of the Project, the District may apply Available Funds in excess of the Rental Payments to fund the excess costs

or, in lieu of making the repairs, restorations, or replacements, the District has the option to terminate the Lease and all of theCorporations interest in the Project, by exercising its option to purchase on the next succeeding Bond Payment Date for which itis possible to give notice of intent to exercise its option to purchase in accordance with the Lease.

There can be no assurance that the Net Proceeds of an insurance or condemnation award will be sufficient to repair or restore theProject or that, if such Net Proceeds are insufficient for such purpose, the District will appropriate sufficient funds for the repair,replacement, or restoration of the Project, or for the payment of the principal of, premium, if any, and interest on the Bondsnecessary in order to exercise its option to purchase under the Lease.

POWER OF EMINENT DOMAIN . . . Pursuant to State law, the District has the power to exercise its rights under the doctrine ofeminent domain to condemn and take ownership of property for public use. There is no assurance that the District will notexercise its power of eminent domain in order to take possession of the Project and to terminate its obligations under the Lease.Under the eminent domain process, a State judge appoints a three-member panel of commissioners to arrive at a fair price for theDistrict to purchase the property. The District and the Corporation have agreed in the Lease, to the extent permitted by law, thatin the event the District determines to exercise its power of eminent domain to take the Corporations or the Trustees interest inthe Project or any part thereof, that the damages payable to the Corporation or the Trustee will be an amount which will besufficient to pay the principal of, premium, if any, and accrued interest on all outstanding Bonds to the earliest date for whichnotice of redemption can be given pursuant to the Trust Indenture. Any condemnation proceeds are to be deposited with theTrustee and distributed to the registered owners in accordance with the provisions of the Trust Indenture.

There is no precedential law in the State to indicate (i) whether or not the courts would prevent the Districts condemnation ofthe Project as an equitable abuse of its eminent domain power, or (ii) whether or not the courts would uphold the validity of theagreement of the District and the Corporation under the Lease to establish, in advance, the damages to be paid to the Corporationor the Trustee in the event that the District determines to exercise its power of eminent domain to acquire title to the Project. Ifthe agreement of the District and the Corporation is not upheld, there is no assurance that the fair price arrived at by the panelof commissioners will be sufficient to pay the principal of, redemption premium, if any, and interest on the Bonds thenoutstanding.

REMEDIES . . . If an Event of Default occurs under the Financing Documents, the practical realization of any rights upon any

default will depend on the exercise of various remedies specified in the Trust Indenture, the Mortgage and Security Agreement,and the Lease. The enforcement of any remedies granted to the Trustee under these agreements may be affected by variousmatters including: (i) federal bankruptcy laws; (ii) rights of third parties in cash, securities, and instruments not in possession ofthe Trustee, including accounts and general intangibles converted for cash; (iii) rights arising in favor of the United States ofAmerica or any agency thereof; (iv) present or future prohibitions against assignments in any federal statutes or regulations; (v)constructive trusts, equitable liens, or other rights imposed or conferred by any state or federal court in the exercise of itsequitable jurisdiction; (vi) the necessity for judicial action with respect to certain remedies, which is often subject to judicialdiscretion and delay; (viii) claims that might obtain priority if continuation statements are not filed in accordance with applicablelaws; (ix) rights to proceeds of any collateral may be impaired if appropriate action is not taken to continue the perfection of asecurity interest therein as required by the Texas Business and Commerce Code; (x) statutory liens; and (xi) any rights of partiessecured by encumbrances permitted by the Lease.

The various legal opinions to be delivered concurrently with the issuance of the Bonds will be qualified as to the enforceabilityof the remedies provided under the Bond documents as a result of limitations imposed by bankruptcy, reorganization, insolvency,fraudulent conveyance, or other similar laws affecting the rights of creditors generally and by general principles of equity andpublic policy considerations. If any of such limitations are imposed they may adversely affect the ability of the Trustee and theBondholders to enforce their claims and rights against the Corporation, the District, and the Project. Consequently, in the eventof a default, it is uncertain that the Trustee could successfully obtain an adequate remedy at law or in equity on behalf of theowners of the Bonds.

INABILITY TO LIQUIDATE OR DELAY IN LIQUIDATING THE PROJECT . . . An Event of Default or an Event of Nonappropriationgives the Trustee the right to sell or lease the Project. The Project is intended to be used as a food service warehouse. There canbe no assurance of the value of the Project for any other use. Accordingly, a potential purchaser of the Bonds should notanticipate that the sale or re-lease of the Project could be accomplished rapidly, on favorable terms or at all. Furthermore, anydelay in the ability of the Trustee to obtain possession of the Project may result in delays in the payment of debt service on theBonds after expenditure of the Reserve Account, if any.


10/185

6

There is no assurance that the Trustee will be able to sell or lease the Project after a termination of the Lease for anamount equal to the aggregate principal amount of the Bonds then outstanding plus accrued interest thereon. If theProject is sold or leased by the Trustee for an amount less than the aggregate principal amount of and accrued interest onthe Bonds, such partial payment would be the only remedy of the registered owners of the Bonds; upon such a partialpayment, no registered owner will have any further claim for payment upon the Corporation, the Trustee, or the District.

CONSTITUTIONALITY OF THE LEASE OBLIGATION . . . In City-County Solid Waste Control Board v. Capital City Leasing, 813S.W.2d 705 (Tex. Civ. App. 1991, writ den.), a Texas appellate court ruled that an equipment lease which required agovernmental unit to pursue annual appropriations creates an unconstitutional debt, thus rendering the lease void andunenforceable. The Texas Supreme Court declined, without comment, to hear the case on appeal. Although the Lease and the

Trust Indenture acknowledge that the Rental Payments and certain other financial obligations of the District and the Corporationare payable from funds that must be appropriated by the Texas Legislature and by the District, there is no explicit covenant in theLease requiring the District to seek an appropriation. Accordingly, Co-Bond Counsel believes the facts of such case aredistinguishable from the language contained in the Lease. However, there can be no guarantee that another court would notapply reasoning similar to that of the appellate court in the Capital City Leasing case to the Lease.

OTHER OBLIGATIONS OF THE DISTRICT . . . The obligation of the District to make Rental Payments will be satisfied from thefunds of the District which are appropriated for such use. To the extent the Basic Allotment and surplus maintenance taxrevenues are used by the District to make the Rental Payments, the District may enter into other obligations which mayconstitute additional charges against such funds from which the Rental Payments may be appropriated and, therefore, such fundsavailable for appropriation for Rental Payments may be decreased.

TRANSFERABILITY OF BONDS UPON A TERMINATION EVENT . . . Co-Bond Counsel has rendered no opinion with respect to theapplicability or inapplicability of the registration requirements of the Securities Act of 1933, as amended, to any Bondsubsequent to a termination of the Lease by reason of an Event of Default or an Event of Nonappropriation thereunder or due toan Event of Default under the Trust Indenture. If the Lease is terminated by reason of an Event of Default or an Event ofNonappropriation, there is no assurance that the Bonds may be transferred by a holder thereof without compliance with theregistration provisions of the Securities Act of 1933, as amended, or the availability of an exemption therefrom.

LOSS OF TAX-EXEMPT STATUS UPON A TERMINATION EVENT . . . Co-Bond Counsel has rendered no opinion as to the treatmentfor federal income tax purposes of any money received by a registered owner of the Bonds subsequent to a termination of theLease by reason of an Event of Default or an Event of Nonappropriation thereunder or due to an Event of Default under theTrustee Indenture. There is no assurance that any money received by the registered owners of the Bonds subsequent to suchevent will continue to be excludable from gross income for federal income tax purposes.

NONCOMPLIANCE WITH ARBITRAGE PROVISIONS:OCCURRENCE OF TAXABILITY . . . The Lease and the Trust Indenture obligatethe District and the Corporation to comply with requirements of federal law regarding rebate of certain investment proceeds tothe federal government. If the District or the Corporation fails to comply with those requirements, the Bonds would becomearbitrage bonds, and the interest portion of the Bond Payments could become includable in gross income for federal income

tax purposes retroactive to the date of issuance of the Bonds. Such a failure by the Corporation or the District to comply with thecovenants, conditions, or agreements on their part to be observed or performed by them under the Lease or the Trust Indenture, ifnot cured within 20 days of written notice thereof, will constitute an Event of Default under the Lease or the Trust Indenture, asapplicable. Thereafter, the Trustee will have the right to exercise one or more of the remedies set forth in the Trust Indenture orthe Lease, which may or may not include the acceleration of the principal of and accrued but unpaid interest on the Bonds. In noevent, however, would the registered owners of the Bonds be entitled to an increase in the interest rate on the Bonds and,accordingly, the after-tax yield to the registered owners would be materially decreased.

NON-RECOURSE OBLIGATION . . . The payment of principal, premium, if any, and interest on the Bonds is without recourse tothe Corporation and the ability of the Corporation to pay debt service on the Bonds is completely dependent upon the receipt ofRental Payments from the District. The only obligation of the Corporation is to provide the District with continued quietenjoyment of the Project, provided the District is not in default under the Lease. The Districts ability to perform its obligationsunder the Lease and its capability to appropriate money for the Lease may be adversely affected by the financial condition of theDistrict. See FINANCIAL AND OPERATING INFORMATION FOR THE DISTRICT.

RESALE OF BONDS . . . There may not be a secondary market for the Bonds, and the Initial Purchaser has not committed tomaintain such a market. In the secondary market for securities similar to the Bonds, the difference between the bid and askedprice may be greater than the difference between the bid and asked price for more traditional types of municipal securities.


11/185

7

THE BONDS

DESCRIPTION OF THE BONDS . . . The Bonds will be issued in an aggregate principal amount of $33,600,000 as fully registeredBonds in denominations of $5,000 or any integral multiple thereof. The Bonds will be dated as of April 1, 2006 and will bearinterest at the rates per annum shown on the inside cover page hereof from the dated date thereof, computed on the basis of a360-day year consisting of twelve 30-day months, payable on September 15, 2006, and semiannually thereafter on March 15 andSeptember 15 of each year (each, a Bond Payment Date), and will mature on September 15 in the years and in the amountsshown on the inside cover page hereof, unless earlier called for redemption. The definitive Bonds will be issued only in fullyregistered form in any integral multiple of $5,000 for any one maturity and will be initially delivered only to Cede & Co., thenominee of The Depository Trust Company (DTC) pursuant to the book-entry system described herein. Beneficial ownership

of the Bonds may be acquired in denominations of $5,000 or any integral multiple thereof. No physical delivery of the Bondswill be made to the beneficial owners thereof. Principal of and interest on the Bonds will be payable by the Trustee to Cede &Co., which will make distribution of the amounts so paid to the beneficial owners of the Bonds. See - BOOK-ENTRY-ONLYSYSTEM below.

BOOK-ENTRY-ONLY SYSTEM . . . This section describes how ownership of the Bonds is to be transferred and how the principalof, premium, if any, and interest on the Bonds are to be paid to and accredited by DTC while the Bonds are registered in itsnominee name. The information in this section concerning DTC and the Book-Entry-Only System has been provided by DTCfor use in disclosure documents such as this Official Statement. The District believes the source of such information to bereliable, but takes no responsibility for the accuracy or completeness thereof.

The District cannot and does not give any assurance that (1) DTC will distribute payments of debt service on the Bonds, orredemption or other notices, to DTC Participants, (2) DTC Participants or others will distribute debt service payments paid toDTC or its nominee (as the registered owner of the Bonds), or redemption or other notices, to the Beneficial Owners, or that theywill do so on a timely basis, or (3) DTC will serve and act in the manner described in this Official Statement. The current rulesapplicable to DTC are on file with the Securities and Exchange Commission, and the current procedures of DTC to be followedin dealing with DTC Participants are on file with DTC.

DTC will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities registered in the

name of Cede & Co. (DTC's partnership nominee). One fully-registered certificate will be issued for each maturity of the Bonds

in the aggregate principal amount or maturity amount, as applicable, of each such maturity and will be deposited with DTC.

DTC is a limited-purpose trust company organized under the New York Banking Law, a banking organization within the

meaning of the New York Banking Law, a member of the Federal Reserve System, a clearing corporation within the meaning

of the New York Uniform Commercial Code, and a clearing agency registered pursuant to the provisions of Section 17A of the

Securities Exchange Act of 1934. DTC holds securities that its participants (Direct Participants) deposit with DTC. DTC also

facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities

through electronic computerized book-entry changes in Participants' accounts, thereby eliminating the need for physical

movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing

corporations, and certain other organizations. DTC is owned by a number of its Direct Participants and by the New York Stock

Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC

system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or maintain

a custodial relationship with a Direct Participant, either directly or indirectly (Indirect Participants). The Rules applicable to

DTC and its Participants are on file with the Securities and Exchange Commission.

Purchases of Bonds under the DTC system must be made by or through DTC Participants, which will receive a credit for such

purchases on DTC's records. The ownership interest of each actual purchaser of each Bond (Beneficial Owner) is in turn to be

recorded on the Direct or Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of

their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transaction, as well

as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into

the transaction. Transfers of ownership interest in the Bonds are to be accomplished by entries made on the books of

Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their

ownership interests in the Bonds, except in the event that use of the book-entry system described herein is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTC's

partnership nominee, Cede & Co. The deposit of Bonds with DTC and their registration in the name of Cede & Co. effect no

change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC's records reflect

only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial

Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants,

and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject

to any statutory or regulatory requirements as may be in effect from time to time.


12/185

8

Redemption notices shall be sent to Cede & Co. If less than all of the Bonds within an issue are being redeemed, DTC's practiceis to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. will consent or vote with respect to the Bonds. Under its usual procedures, DTC mails an

Omnibus Proxy to the District as soon as possible after the Record Date (hereinafter defined). The Omnibus Proxy assigns Cede

& Co.'s consenting or voting rights to those Direct Participants to whose accounts the Bonds are credited on the Record Date

(identified in a listing attached to the Omnibus Proxy).

Principal and interest payments on the Bonds will be made to DTC. DTC's practice is to credit Direct Participants' accounts on

each payable date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it

will not receive payment on such payable date. Payments by Participants to Beneficial Owners will be governed by standinginstructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered

in street name, and will be the responsibility of such Participant and not of DTC, the Trustee or the District, subject to any

statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to DTC is the

responsibility of the Corporation, disbursement of such payments to Direct Participants shall be the responsibility of DTC, and

disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct and Indirect Participants.

DTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable

notice to the Corporation. Under such circumstances, in the event that a successor securities depository is not obtained, Bonds

are required to be printed and delivered.

The Corporation may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities

depository). In that event, Bonds will be printed and delivered.

Use of Certain Terms in Other Sections of this Official Statement

In reading this Official Statement it should be understood that while the bonds are in the Book-Entry Only System, references inother sections of this Official Statement to registered owners should be read to include the person for which the Participantacquires an interest in the Bonds, but (i) all rights of ownership must be exercised through DTC and the Book-Entry OnlySystem, and (ii) except as described above, notices that are to be given to registered owners under the Trust Indenture will begiven only to DTC.

Information concerning DTC and the Book-Entry Only System has been obtained from DTC and is not guaranteed as toaccuracy or completeness by, and is not to be construed as a representation by the Corporation or the Initial Purchaser.

Effect of Termination of Book-Entry-Only System

In the event that the Book-Entry-Only System is discontinued by DTC or the use of the Book-Entry-Only System is discontinuedby the Corporation, the following provisions will be applicable to the Bonds. The Bonds may be exchanged for an equal

aggregate principal amount of Bonds in authorized denominations and of the same maturity upon surrender thereof at theprincipal office for payment of the Trustee. The transfer of any Bond may be registered on the books maintained by the Trusteefor such purpose only upon the surrender of such Bond to the Trustee with a duly executed assignment in form satisfactory to theTrustee. For every exchange or transfer of registration of Bonds, the Trustee and the Corporation may make a charge sufficientto reimburse them for any tax or other governmental charge required to be paid with respect to such exchange or registration oftransfer. The Corporation shall pay the fee, if any, charged by the Trustee for the transfer or exchange. The Trustee will not berequired to transfer or exchange any Bond after its selection for redemption. The Corporation and the Trustee may treat theperson in whose name a Bond is registered as the absolute owner thereof for all purposes, whether such Bond is overdue or not,including for the purpose of receiving payment of, or on account of, the principal of, premium, if any, and interest on, suchBond.

REDEMPTION

EXTRAORDINARY OPTIONAL REDEMPTION-CASUALTY LOSS OR CONDEMNATION . . . The Bonds are subject to redemption andprepayment, in whole, but not in part, at a redemption price of 100% of the principal amount of the Bonds being redeemed, plusaccrued interest to the date of redemption, in the event of the exercise by the District of its option to purchase upon a casualtyloss or condemnation of the Project, and the payment by the District to the Trustee of the Purchase Option Price.

EXTRAORDINARY OPTIONAL REDEMPTION-TERMINATION OF LEASE . . . The Bonds shall be subject to redemption on any BondPayment Date, at the option of the Trustee, in whole but not in part, upon termination of the Lease due to the occurrence of anEvent of Default, Event of Non-Appropriation, or the Districts payment of the Purchase Option Price at a redemption price of100% of the principal amount of the Bonds being redeemed, plus accrued interest to the date of redemption.


13/185

9

OPTIONAL REDEMPTION . . . The Corporation reserves the right, at its option, to redeem Bonds having stated maturities on andafter September 15, 2017, in whole or in part in principal amounts of $5,000 or any integral multiple thereof, on September 15,2016, or any date thereafter, at the par value thereof plus accrued interest to the date of redemption. If less than all of the Bondsare to be redeemed, the Corporation may select the maturities of Bonds to be redeemed. If less than all the Bonds of anymaturity are to be redeemed, the Trustee (or DTC while the Bonds are in Book-Entry-Only form) shall determine by lot theBonds, or portions thereof, within such maturity to be redeemed. If a Bond (or any portion of the principal sum thereof) shallhave been called for redemption and notice of such redemption shall have been given, such Bond (or the principal amountthereof to be redeemed) shall become due and payable on such redemption date and interest thereon shall cease to accrue fromand after the redemption date, provided funds for the payment of the redemption price and accrued interest thereon are held bythe Trustee on the redemption date.

MANDATORY SINKING FUND REDEMPTION . . . In addition to the foregoing optional redemption provision, the Term Bonds aresubject to mandatory redemption prior to maturity in the amounts and on the dates set out below, at a price equal to the principalamount to be redeemed plus accrued interest to the redemption date:

$6,515,000 Term Bonds Due September 15, 2030

Due

Principal September 15

2,075,000$ 2028

2,170,000 2029

2,270,000 (maturity) 2030

Term Bonds to be redeemed in any year by mandatory sinking fund redemption shall be redeemed at par and shall be selected by

lot from and among the Term Bonds then subject to redemption. The Corporation, at its option, may credit against anymandatory sinking fund redemption requirement Term Bonds of the maturity then subject to redemption which have beenpurchased and canceled by the Corporation or have been redeemed and not theretofore applied as a credit against any mandatorysinking fund redemption requirement.

NOTICE OF REDEMPTION . . . If any of the Bonds are called for redemption, the Trustee will give written notice by first class(postage prepaid) mail not less than 30 days prior to the date fixed for redemption, in the name of the Corporation, of theredemption of such Bonds to the registered owner of each Bond to be redeemed in whole or in part at the address shown on theregistration books at the close of business on a day not later than the fifth day preceding the date of mailing. Any notice somailed will be conclusively presumed to have been duly given, whether or not the owner of such Bonds actually receives thenotice. Failure to give such notice by mail to any registered owner, or any defect therein, will not affect the validity of anyproceedings for the redemption of other Bonds.

PARTIAL REDEMPTION . . . If less than all of the Bonds are called for redemption, the particular Bonds or portions thereof ofsuch series to be redeemed shall be in amounts equal to $5,000 or an integral multiple thereof and shall be selected by the

Trustee ratably among each maturity of the Bonds and at random within each maturity. In selecting Bonds for redemption, theTrustee shall select Bonds to be redeemed in such a manner that, after such redemption, all remaining Bondholders own onlyBonds in denominations of $5,000 or any integral multiple thereof. Upon surrender of any Bond for redemption in part, theCorporation shall execute and the Trustee shall authenticate and deliver to the owner thereof a new Bond or Bonds of the sameinterest rate and maturity and of authorized denominations in an aggregate principal amount equal to the unredeemed portion ofthe Bond so surrendered.

EFFECT OF REDEMPTION . . . Notice of redemption having been given as provided above, the Bonds or portions thereofdesignated for redemption will become and be due and payable on the date fixed for redemption at the redemption price providedfor herein, provided funds for their redemption are on deposit at the place of payment at that time, and, unless the Corporationdefaults in the payment of the principal thereof, such Bonds or portions thereof will cease to bear interest from and after the datefixed for redemption, whether or not such Bonds are presented and surrendered for payment on such date. Thereafter, theowners of such Bonds will no longer be entitled to any security or benefit under the Trust Indenture except to receive payment ofthe redemption price. If any Bond or portion thereof called for redemption is not so paid upon presentation and surrender thereoffor redemption, such Bond or portion thereof will continue to bear interest at the rate set forth therein until paid or until due

provision is made for the payment of the same.


14/185

10

USES OF FUNDS

The proceeds from the sale of the Bonds, excluding accrued interest which will be deposited to the Payment Account, areexpected to be expended as follows:

Deposit to Project Acquisition Fund 33,073,143.00$

Costs of Issuance(1)

526,857.00

Total Uses of Funds 33,600,000.00$

_______________

(1) Includes Surety Bond premium.DEBT SERVICE REQUIREMENTS OF THE CORPORATION

The Corporation previously issued $94,246,093 Lease Revenue Bonds for the construction of the Cesar E. Chavez High Schooland the West Side High School.

Fiscal Total

Year Ending Outstanding Outstanding

June 30 Debt Service Principal Interest Total Debt Service

2006 8,070,000$ 8,070,000$

2007 8,245,000 425,000$ 1,456,624$ 1,881,624$ 10,126,624

2008 8,690,000 400,000 1,507,263 1,907,263 10,597,263

2009 9,145,000 405,000 1,490,156 1,895,156 11,040,156

2010 9,280,000 880,000 1,462,850 2,342,850 11,622,8502011 9,415,000 915,000 1,424,706 2,339,706 11,754,706

2012 9,890,000 955,000 1,384,969 2,339,969 12,229,969

2013 10,035,000 995,000 1,343,531 2,338,531 12,373,531

2014 10,515,000 1,045,000 1,293,650 2,338,650 12,853,650

2015 10,675,000 1,095,000 1,234,800 2,329,800 13,004,800

2016 10,840,000 1,150,000 1,173,063 2,323,063 13,163,063

2017 10,840,000 1,205,000 1,108,300 2,313,300 13,153,300

2018 3,885,000 1,260,000 1,048,388 2,308,388 6,193,388

2019 3,885,000 1,325,000 994,284 2,319,284 6,204,284

2020 3,885,000 1,385,000 938,391 2,323,391 6,208,391

2021 3,885,000 1,450,000 879,013 2,329,013 6,214,013

2022 3,885,000 1,515,000 815,059 2,330,059 6,215,059

2023 1,585,000 746,256 2,331,256 2,331,2562024 1,660,000 673,244 2,333,244 2,333,244

2025 1,735,000 596,856 2,331,856 2,331,856

2026 1,815,000 516,981 2,331,981 2,331,981

2027 1,900,000 433,394 2,333,394 2,333,394

2028 1,985,000 345,981 2,330,981 2,330,981

2029 2,075,000 253,334 2,328,334 2,328,334

2030 2,170,000 155,169 2,325,169 2,325,169

2031 2,270,000 52,494 2,322,494 2,322,494

135,065,000$ 33,600,000$ 23,328,755$ 56,928,755$ 191,993,755$

The Bonds


15/185

11

SECURITY FOR THE BONDS

Payments of principal and interest with respect to the Bonds are payable only from the Rental Payments to be paid by the Districtunder the Lease, from certain money held by the Trustee under the Trust Indenture, and from amounts received by the Trustee fromthe sale or other transfer of the Corporations interest in the Project after termination of the Lease following an Event of Default orEvent of Nonappropriation by the District.

TRUST ESTATE

All payments to be made by the Trustee under the Trust Indenture to the registered owners may be made only from the income

and proceeds from the Trust Estate and only to the extent that the Trustee has received income or proceeds from the Trust Estate.The Trust Estate consists of all right, title, and interest of the Corporation (i) in and to the Project, (ii) in and under the Leaseand the other Financing Documents, (iii) in and to all Rental Payments and other payments paid or payable by the District fromand after the date of the Trust Indenture, (iv) other income, charges, and funds realized from the lease, sale, transfer, or otherdisposition of the Project, (v) all funds and investments in all accounts (except the Rebate Fund) established under the TrustIndenture, and (vi) all funds deposited with the Trustee pursuant to the Financing Documents.

RENTAL PAYMENTS

The District is required to pay to the Trustee, for the account of the Corporation, the Rental Payments from Available Funds onSeptember 15, 2006, and each March 15 and September 15 thereafter for so long as the Lease is in effect. The amount of eachRental Payment required under the lease is equal to an amount of money which, when added to the amount then on deposit in thePayment Account, will equal (i) the amount of interest to become due on the Bonds on the next Bond Payment Date and (ii) theamount of principal to become due on the Bonds, whether by maturity or by mandatory sinking fund redemption, the next Bond

Payment Date. THE OBLIGATIONS OF THE DISTRICT UNDER THE LEASE, INCLUDING ITS OBLIGATION TO PAY THE RENTALPAYMENTS, CONSTITUTE A CURRENT EXPENSE OF THE DISTRICT IN EACH FISCAL YEAR, AND DO NOT CONSTITUTE ANINDEBTEDNESS OF THE DISTRICT WITHIN THE MEANING OF THE LAWS OF THE STATE. NOTHING IN THE LEASE IS TO CONSTITUTEA PLEDGE BY THE DISTRICT OF ANY TAXES OR OTHER MONEY, OTHER THAN AVAILABLE FUNDS FOR THE CURRENT FISCAL YEAR,TO THE PAYMENT OF RENTAL PAYMENTS DUE THEREUNDER.

MORTGAGE AND SECURITY AGREEMENT

To secure its obligations under the Trust Indenture, the Corporation will grant a first mortgage lien on and first deed of trust titleto the real property portion of the Project and will assign and pledge the Corporations interest in the leases, rents, issues, profits,revenues, income, receipts, money, rights, and benefits of and from the Project for the use and benefit of the Trustee on behalf ofthe owners of the Bonds, pursuant to the Mortgage and Security Agreement. Additionally, the Corporation will grant to theTrustee a first priority purchase money security interest in the machinery, equipment, furnishings, or other personal propertyacquired by the Corporation with the proceeds of the Bonds, and installed or located on the Project site, and substitutions orreplacements therefor, in any inventory of the Corporation now or hereafter located at the Project, and in the accounts,

documents, chattel paper, instruments, and general intangibles arising in any manner from the Corporations ownership andoperation of the Project pursuant to the Mortgage and Security Agreement.

RESERVE ACCOUNT

As additional security, a Reserve Account will be funded upon delivery of the Bonds in an amount equal to the ReserveRequirement to secure payment of the Bonds. Money within the Reserve Account is to be disbursed by the Trustee to payprincipal and interest on the Bonds to the extent that the amount on deposit in the Payment Account is insufficient therefore. SeeRESERVE ACCOUNT SURETY BOND. The Reserve Requirement is $2,342,850. See APPENDIX A SELECTEDPROVISIONS OF THE FINANCING DOCUMENTS.

REMEDIES

REMEDIES AVAILABLE UPON A FAILURE OF THE DISTRICT TO APPROPRIATE OR PAY RENTAL PAYMENTS ARE LIMITED TOTERMINATION OF THE DISTRICTS LEASEHOLD INTEREST, THE RIGHT TO TAKE POSSESSION AND CONTROL OF THE PROJECT, ANDTHE RIGHT TO SELL OR LEASE THE PROJECT UPON FORECLOSURE UNDER THE MORTGAGE AND SECURITY AGREEMENT. SeeAPPENDIX A SELECTED PROVISIONS OF THE FINANCING DOCUMENTS.

The enforcement by the Trustee of the remedies provided in the Financing Documents is subject to the application of principlesof equity and state and federal laws relating to bankruptcy, moratorium, reorganization, and creditors rights generally, and suchremedies may require the expenditure of money and considerable time to enforce.


16/185

12

ADDITIONAL OBLIGATIONS

The Corporation has covenented and agreed that no other obligations will be issued which are secured by a lien on the TrustEstate. The Corporation, however, has reserved the right to issue additional bonds or obligations payable from and secured byrental payments paid from Available Funds received by the Corporation (Additional Obligations); provided, however, that nosuch Additional Obligations may be issued unless and until the following conditions will have all been met:

(a) No Event of Default under the Trust Indenture is in existence at the time of issuance of the Additional Obligations;

(b) The issuance of the Additional Obligations is permitted by the laws of the State effective at the time of the

authorization of such Additional Obligations; and

(c) For the three fiscal years of the District prior to the year in which the resolution authorizing the issuance of theAdditional Obligations is adopted, money appropriated biennially by the Legislature of the State that may lawfully beused with respect to any payment obligated or permitted under the Lease (which under current law is limited toGuaranteed Yield Program Tier One Funds) is equal to not less than two times the average annual principal and interestrequirements of the Bonds and all Additional Obligations at the time outstanding, after giving effect to the issuance ofthe proposed Additional Obligations, as shown by the Districts audited financial statements.

FINANCIAL GUARANTY INSURANCE

PAYMENT PURSUANT TO FINANCIAL GUARANTY INSURANCE POLICY

Ambac Assurance has made a commitment to issue a financial guaranty insurance policy (the Financial Guaranty Insurance Policy)relating to the Bonds effective as of the date of issuance of the Bonds. Under the terms of the Financial Guaranty Insurance Policy,Ambac Assurance will pay to The Bank of New York, in New York, New York or any successor thereto (the Insurance Trustee) thatportion of the principal of and interest on the Bonds which shall become Due for Payment but shall be unpaid by reason ofNonpayment by the Obligor (as such terms are defined in the Financial Guaranty Insurance Policy). Ambac Assurance will make suchpayments to the Insurance Trustee on the later of the date on which such principal and interest becomes Due for Payment or within onebusiness day following the date on which Ambac Assurance shall have received notice of Nonpayment from the Trustee. The insurancewill extend for the term of the Bonds and, once issued, cannot be canceled by Ambac Assurance.

The Financial Guaranty Insurance Policy will insure payment only on stated maturity dates and on mandatory sinking fund installmentdates, in the case of principal, and on stated dates for payment, in the case of interest. If the Bonds become subject to mandatoryredemption and insufficient funds are available for redemption of all outstanding Bonds, Ambac Assurance will remain obligated to payprincipal of and interest on outstanding Bonds on the originally scheduled interest and principal payment dates including mandatorysinking fund redemption dates. In the event of any acceleration of the principal of the Bonds, the insured payments will be made at suchtimes and in such amounts as would have been made had there not been an acceleration.

In the event the Trustee has notice that any payment of principal of or interest on Bonds which has become Due for Payment and whichis made to a Holder by or on behalf of the Obligor has been deemed a preferential transfer and theretofore recovered from its registeredowner pursuant to the United States Bankruptcy Code in accordance with a final, nonappealable order of a court of competent

jurisdiction, such registered owner will be entitled to payment from Ambac Assurance to the extent of such recovery if sufficient fundsare not otherwise available.

The Financial Guaranty Insurance Policy does not insure any risk other than Nonpayment, as defined in the Policy. Specifically, theFinancial Guaranty Insurance Policy does not cover:

1. payment on acceleration, as a result of a call for redemption (other than mandatory sinking fund redemption) or as a result ofany other advancement of maturity.

2. payment of any redemption, prepayment or acceleration premium.3. nonpayment of principal or interest caused by the insolvency or negligence of any Trustee, Paying Agent, or bond Registrar,if any.

If it becomes necessary to call upon the Financial Guaranty Insurance Policy, payment of principal requires surrender of Bonds to theInsurance Trustee together with an appropriate instrument of assignment so as to permit ownership of such Bonds to be registered in thename of Ambac Assurance to the extent of the payment under the Financial Guaranty Insurance Policy. Payment of interest pursuant tothe Financial Guaranty Insurance Policy requires proof of Holder entitlement to interest payments and an appropriate assignment of theHolders right to payment to Ambac Assurance.

Upon payment of the insurance benefits, Ambac Assurance will become the owner of the Bonds, appurtenant coupon, if any, or right topayment of principal or interest on such Bonds and will be fully subrogated to the surrendering Holders rights to payment.


17/185

13

AMBAC ASSURANCE CORPORATION

Ambac Assurance Corporation (Ambac Assurance) is a Wisconsin-domiciled stock insurance corporation regulated by theOffice of the Commissioner of Insurance of the State of Wisconsin and licensed to do business in 50 states, the District ofColumbia, the Territory of Guam, the Commonwealth of Puerto Rico and the U.S. Virgin Islands, with admitted assets of

approximately $8,994,000,000 (unaudited) and statutory capital of approximately $5,649,000,000 (unaudited) as ofDecember31, 2005. Statutory capital consists of Ambac Assurances policyholders surplus and statutory contingency reserve. Standard &Poors Credit Markets Services, a Division of The McGraw-Hill Companies, Moodys Investors Service and Fitch Ratings haveeach assigned a triple-A financial strength rating to Ambac Assurance.

Ambac Assurance has obtained a ruling from the Internal Revenue Service to the effect that the insuring of Bonds by Ambac Assurancewill not affect the treatment for federal income tax purposes of interest on such Bonds and that insurance proceeds representingmaturing interest paid by Ambac Assurance under policy provisions substantially identical to those contained in its financial guarantyinsurance policy shall be treated for federal income tax purposes in the same manner as if such payments were made by the Obligor ofthe Bonds.Ambac Assurance makes no representation regarding the Bonds or the advisability of investing in the Bonds and makes norepresentation regarding, nor has it participated in the preparation of, the Official Statement other than the information supplied byAmbac Assurance and presented under the heading FINANCIAL GUARANTY INSURANCE.

Available Information

The parent company of Ambac Assurance, Ambac Financial Group, Inc. (the Company), is subject to the informational requirementsof the Securities Exchange Act of 1934, as amended (the Exchange Act), and in accordance therewith files reports, proxy statements

and other information with the Securities and Exchange Commission (the SEC). These reports, proxy statements and otherinformation can be read and copied at the SECs public reference room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549.Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. The SEC maintains an internet site athttp://www.sec.gov that contains reports, proxy and information statements and other information regarding companies that