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Res 03-12 Creating a Nonprofit Corporation Pursuant to the Texas Education CodeTOWN OF WESTLAKE RESOLUTION NO. 03-12 A RESOLUTION ORDERING THE CREATION OF A NONPROFIT CORPORATION PURSUANT TO THE TEXAS EDUCATION CODE, APPROVING ARTICLES OF INCORPORATION AND BYLAWS FOR, AND APPOINTING THE INITIAL DIRECTORS OF, THE CORPORATION, APPOINTING CERTAIN CONSULTANTS, AND RESOLVING RELATED MATTERS WHEREAS, Section 53.35(b) of Chapter 53 of the Education Code, the Higher Education Authority Act, as amended (the "Act"), authorizes this Board of Aldermen, as the governing body of the Town of Westlake, Texas (the "Town"), to order the creation of a nonprofit corporation (the "Corporation") under the Act to act on behalf of the Town as its duly constituted authority and instrumentality, within the meaning of the Internal Revenue Code of 1986, as amended, for the purpose of aiding institutions of higher education, accredited primary or secondary schools, or authorized charter schools, as those terms are defined in the Act, in providing educational facilities and housing facilities and facilities incidental, subordinate or related thereto or appropriate in connection therewith; WHEREAS, the Act empowers, among other things, the Corporation to provide financing for "educational facilities" and/or "housing facilities, " each as defined by the Act, and facilities incidental, subordinate, or related thereto or appropriate in connection therewith (any such facilities shall be referred to as the "Facilities"); WHEREAS, the Act provides that the Facilities need not be located within the town limits of the Town; WHEREAS, the Act authorizes the Corporation to issue revenue bonds (`Bonds") and/or to enter into other obligations ("Obligations") that, among other things, will facilitate the acquisition, construction, equipping, and/or the financing of the Facilities; WHEREAS, no Bonds or Obligations of the Corporation will constitute obligations (whether special, general, or moral) of the Town; WHEREAS, the Act provides that the directors of the Corporation are to be appointed by the Board of Aldermen of the Town; WHEREAS, this Board of Aldermen intends, by the adoption of this Resolution, to take all action necessary to order the creation of the Corporation with all of the corporate powers and authority granted under the Act; WHEREAS, the meeting at which this Resolution has been considered was open to the public as required by law, and public notice of the time, place, and subject of the meeting has been given in accordance with Chapter 551, Government Code; NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF ALDERMEN OF THE TOWN OF WESTLAKE, TEXAS: SECTION 1. The findings and declarations contained in the preamble of this Resolution are hereby incorporated as part of this Resolution. SECTION 2. This Board of Aldermen hereby finds and determines that it is in the best interest of the Town and its inhabitants that the Corporation, to be named as specified in the Corporation's articles of incorporation (the "Articles"), be created pursuant to the Act to act on behalf of the Town as its duly constituted authority and instrumentality for the purposes and with the powers and authority prescribed by the Act. SECTION 3. This Board of Aldermen hereby orders the creation of the Corporation and approves the Articles in substantially the form attached to this Resolution as Exhibit -A, and hereby authorizes the incorporators of the Corporation (as identified in such Articles) to file the Articles with the Secretary of State in accordance with law. In the event that the name for the Corporation specified in the Articles is not available, the incorporators are hereby authorized to change the Corporation's name in the Articles without the further approval of the Town. SECTION 4. This Board of Aldermen hereby appoints the persons identified in the Articles (none of whom is an officer or employee of the Town) to serve as the initial members of the board of directors of the Corporation. SECTION 5. This Board of Aldermen hereby approves the initial bylaws of the Corporation in substantially the form attached to this Resolution as Exhibit -B. SECTION 6. It is intended that the Corporation be a duly constituted authority and instrumentality of the Town within the meaning of regulations and/or revenue rulings of the Treasury Department and/or the Internal Revenue Service of the United States promulgated under Sections 103 and 115 of the Internal Revenue Code of 1986. SECTION 7. With respect to the Town and its instrumentalities, the Board of Aldermen hereby appoints Scott Bradley, as "General Counsel," Larry Williamson, as "Financial Advisor," Thomas Allen Moon, as "Finance Counsel," Jenkens & Gilchrist, P. C., as "Special Finance Counsel," and Block & Associates, Inc., as the "Real Estate and Finance Consultant." SECTION S. This Resolution shall take effect immediately upon its adoption. PASSED AND APPROVED ON THIS 24TH DAY OF FEBRUARY 2003. ATTEST: GingerkCrosswy, Town cretary APPROVED AS TO FORM: List of Exhibits: Exhibit -A Articles of Incorporation Exhibit -B Bylaws Scott Bradley, Mayor 01 Trent O. Petty, Town Mager ARTICLES OF INCORPORATION of TEXAS CHARTER SCHOOL CORPORATION -- LTTS CHARTER SCHOOL, INC. PROJECT Pursuant to Section 53.35(b) of Chapter 53 of the Education Code, the Higher Education Authority Act, as amended (the "Act"), we, the undersigned natural persons, each of whom is above the age of 18 years and is acting on behalf of and as directed by the Town of Westlake, Texas (the "Town"), do hereby adopt the following Articles of Incorporation for such corporation ("Corporation"): ARTICLE I The name of the Corporation is "Texas Charter School Corporation — LTTS Charter School, Inc. Project." ARTICLE II The Corporation is a nonprofit corporation created under the Act. ARTICLE III The duration of the Corporation is perpetual (subject to dissolution according to law as provided in these Articles of Incorporation). ARTICLE IV The purpose of the Corporation is to act on behalf of the Town as its duly constituted authority and instrumentality and, in connection therewith, to exercise all powers and authority granted, under the Act and other applicable law, to corporations created under Section 53.35(b) under the Act. ARTICLE V The Corporation shall have no members and is a nonstock corporation. ARTICLE VI The street address of the initial registered office of the Corporation is 3 Village Circle, Suite 207, Westlake, Texas 76262, and the name of the initial registered agent at that address is Scott Bradley. ARTICLE VII All powers and authority of the Corporation shall be vested in a board of directors (the "Board"), subject limitations imposed by law or otherwise, each member of which shall be appointed by resolution of the governing body of the Town. The number of directors and their terms of office shall be fixed by the bylaws of the Corporation consistent with the Act. The directors shall serve without compensation, except that they shall be entitled to reimbursement for the actual expenses they incur in the performance of their official duties. ARTICLE VIII The number of directors constituting the initial Board shall be seven. The respective names and addresses of the initial directors, none of whom is an officer or employee of the Town, arc as follows: TAMN. LTCSC -- LTTS Charter School, Inc. Project. 1/28/2003 Name of Initial Director 1. James P. Carter 2. Worth Blake 3. Annette Bush 4. Dr. Forrest Watson 5. Dr. John Brooks 6. Becky Rogers 7. Address 204 Fresh Meadow Dr. Trophy Club, Texas 76262 244 Oak Hill Drive Trophy Club, Texas 76262 203 Oak Hill Drive Trophy Club, Texas 76262 301.1 Lombardi Way Cedar Park, Texas 78613 513 Sides Ct. Lewisville, Texas 75057 403 Bryn Meadow Southlake, Texas 76092 ARTICLE IX The respective names and street addresses of the incorporators, each of who is a citizen of the State of Texas and is at least 18 years of age, are as follows: Name of Incorporator I . Fred Held 2. Don Redding 3. Larry Sparrow 4. Buddy Brown 5. Bill Frey Address 4105 Aspen Lane Westlake, Texas 76262 5925 Janet Court Westlake, Texas 76262 4035 Aspen Lane 76262 Westlake, Texas 76262 13298 Thornton Drive Westlake, Texas 76262 5924 Janet Court Westlake, Texas 76262 ARTICLE X On February 24, 2003 the governing body of the Town duly adopted a resolution ordering the creation of the Corporation, authorizing the Corporation to act on behalf of the Town as its duly constituted authority and instrumentality, and approving the form of these Articles of Incorporation. 2 TAM. V.1.TCSC — LTTS Charter School, Inc. Project. 1/28/2003 ARTICLE XI These Articles of Incorporation may be amended from time to time by a majority vote of the entire membership of the Board with the approval of the governing body of the Town. Neither the Corporation's initial bylaws nor any amendment thereof shall take effect until approved by the governing body of the Town. ARTICLE XII No dividends shall be paid by the Corporation and no part of its earnings shall be distributed to or inure to the benefit of the Corporation's directors or officers or to any private person, firm, corporation, or association except in reasonable amounts for services rendered. ARTICLE XIII The governing body of the Town, in its discretion and without any action by the Board, may at any time change the structure, organization, programs, or activities of the Corporation or may dissolve the Corporation. If the Board determines that the Corporation's purposes have been substantially accomplished, and all of the Corporation's debts and claims have been satisfied, or satisfaction thereof has been provided for, the Board shall, upon approval by the governing body of the Town, dissolve the Corporation. Any dissolution of the Corporation shall be subject to any limitations on the impairment of contracts prescribed by the respective constitutions and other applicable law of the United States of America and the State of Texas. Ifthe Corporation is dissolved when it has, or is entitled to, any interest in any funds or other property of any kind (real, personal, or mixed), such interest shall not be transferred to private ownership but shall be transferred and delivered to the Town (after satisfaction or provision for satisfaction of the Corporation's debts and claims has been made). ARTICLE XIV Regardless of any other provisions of these Articles of Incorporation or the laws of the State of Texas, the Corporation shall not: (1) permit any part of the net earnings of the Corporation to inure to the benefit of any private individual (except that reasonable compensation may be paid for personal services rendered to or for the Corporation affecting one or more of its purposes); (2) devote more than an insubstantial part of its activities to attempting to influence legislation by propaganda or otherwise; or (3) participate in, or intervene in (including the publication or distribution of statements), any political campaign on behalf of any candidate for public office. ARTICLE XV Notwithstanding any other provisions in these Articles to the contrary, (1) the Corporation shall not engage in any business activity other than in connection with and reasonably related to the financing, acquisition, ownership, and operation of a charter school educational facility (the "Project") to be owned by LTTS Charter School, Inc. and/or any affiliate, successor, or assignee thereof as long as any debt, secured by a mortgage against the Project, is outstanding and has not been defeased, and (2) no amendment shall be made to this Article XV without the unanimous consent of all directors. TAM. V.I .TCSC — LTTS Charter School, Inc. Project. 1 /2812003 ARTICLE XVI Subject to the requirements of any agreement made by the Corporation relating to any bonds issued by the Corporation or the requirements of any agreement to which the Corporation is subject, subsequent to the repayment of all bonds issued by the Corporation, any property of the Corporation securing such bonds will revert, automatically, to the Town. IN WITNESS WHEREOF, we have executed these Articles of Incorporation on February 24, 2003. Incorporators Fred Held: Don Redding: Larry Sparrow: Buddy Brown: Bill Frey: STATE OF TEXAS COUNTY OF TARRANT I, the undersigned, a Notary Public of the State of Texas, certify that on this February 24, 2003, personally appeared before me Fred Held, Don Redding, Larry Sparrow, Buddy Brown, and Bill Frey who, being by me first duly sworn, severally declared that they are the persons who signed the foregoing document as incorporators and that the statements therein contained are true, IN WITNESS WHEREOF, the foregoing instrument was acknowledged before me on the date and year above written. Notary Public, State of Texas Ginger Crosswy: My Commission Expires:„�a [SEAL] �e gip { �s1� .rrz":a IS TATE OF TEXP1,115 Up. GVL,12149 4 TAM.V.I.TCSC—NEW FRON=RS Charger School, Inc. Project. 1/28/2003 BYLAWS of TEXAS CHARTER SCHOOL CORPORATION — LTTS CHARTER SCHOOL, INC. PROJECT ARTICLE I POWERS AND OPERATIONS IN GENERAL SECTION 1.1. Powers of Corporation. The Texas Charter School Corporation — LTTS Charter School, Inc. Project (the "Corporation") shall have all of the powers and authority granted to nonprofit corporations created under Section 53.35(b), Texas Education Code, as amended (the "Act"). The Corporation shall be managed by the Board of Directors (the "Board of Directors") in accordance with the Act. SECTION 1.2. Supervision by Board of Aldermen. As the instrumentality of the Town of Westlake (the "Town"), the Corporation and its policies are subject to supervision by the Town's Board of Aldermen (the "Board of Aldermen.") SECTION 1.3. Student Assistance Program. (a) The Corporation shall establish a program (the "Student Assistance Program") to provide assistance to students attending institution(s) of higher education whose principal campus is located in the State of Texas. (b) Students qualifying for assistance shall be referred to as "Recipients," who in order to qualify must: of Texas, and (i) be a graduate of a high school located in the State of Texas, (ii) attend an institution of higher education whose principal campus is located in the State (iii) meet the requirements promulgated from time to time by the Board of Directors. (c) Recipients may be provided use of student housing facilities owned by the Corporation at a cost less than the cost paid by other students residing in the same student housing facility (the assistance provided to each Recipient shall be referred to as a "Scholarship"). (d) The Student Assistance Program shall be funded exclusively from those funds (if any) of the Corporation that are (i) not subject to a lien and/or pledge securing the Corporation's bonds or other obligations, (ii) not required for the timely payment of the Corporation's operation and maintenance expenses, and TCSC--LTTS.BYLAWS —Page 1 TAM.v2.2/06/2003 (iii) authorized by the Board of Directors. (e) Corporation funds not used to provide funds for the Student Assistance Program may be used for any lawful purpose. SECTION 1.4. Regulations. The Corporation, by action of the Board of Directors, may promulgate regulations (the "Regulations") governing the Corporation's operations and implementation of the Student Assistance Program. The Regulations shall not conflict with, and shall be subject to, these Bylaws and the Articles of Incorporation (the "Articles") of this Corporation. ARTICLE 11 THE BOARD OF DIRECTORS SECTION 2.1. Number Appointment, Term Disqualifications, and Removal of Directors. (a) The Directors constituting the initial Board of Directors are those specified in the Articles. (b) The Board of Directors shall consist of seven Directors. (c) Successor Directors (including Directors filling vacancies) shall be appointed by the Board of Aldermen. (d) The tern of each Director shall be two years. (e) As a Director's term expires, the Director shall continue to serve until a successor is appointed and assumes office; provided that, if a Director is removed or resigns, the Director's office shall be deemed vacant upon the removal or resignation. (f) Any Director may be removed at any time (with or without cause) by the Board of Aldermen. (g) No officer or employee of the Town may serve as a Director. SECTION 2.2. Resignation. Any Director may resign at anytime, A resignation shall be made by written instrument and shall take effect at the time specified therein or, if no time is specified, at the time of its receipt by the president or the secretary of the Corporation. The acceptance of a resignation is not necessary to make it effective unless expressly provided in the instrument of resignation. SECTION 2.3. Committees. (a) With respect to the management of the Corporation, the Board of Directors, by resolution adopted by a majority of the Directors present, may designate one or more committees that, to the extent provided in the resolution, shall have the authority of the Board of Directors in the management of the Corporation. Each committee shall consist of two or more Directors. Committees that do not have the TCSC--LTTS.BYLAWS — Page 2 TAM.v2.2/06/2003 authority of the Board of Directors in the management of the Corporation may be designated by resolution of the Board of Directors and membership on any committee is not limited to Directors. (b) With respect to the administration of the Student Assistance Program, an Education Leadership Advisory Committee (the "Advisory Committee") empowered to advise the Board of Directors concerning student needs, assistance, and other matters relating to Scholarships, may be established by the President. The Advisory Committee shall be composed of five members and shall include two Directors. The President shall be empowered to appoint and remove all members of the Advisory Committee. SECTION 2.4. Compensation of Directors. Directors are not entitled to receive any compensation for their services as officers, except for reimbursement of their actual expenses incurred in the performance of their official duties. ARTICLE III THE OFFICERS AND DUTIES SECTION 3.1. Officers. (a) The officers of the Corporation shall be a president (the "President"), a vice president (the "Vice President"), a secretary (the "Secretary"), an assistant secretary (the "Assistant Secretary"), a treasurer (the "Treasurer"), an assistant treasurer (the "Assistant Treasurer"), an executive director (the "Executive Director"), and such other officers as the Board of Directors may from time to time appoint. (b) The President and Vice President shall be Directors, but no other officers are required to be Directors. (c) The same person may hold more than one office, except that the President shall not hold the office of Secretary. SECTION 3.2. Appointment, Term, Removal. Vacancv of Offices. (a) Each officer shall be appointed by the Board of Directors for a term of two years and, in the absence of resignation or removal, shall continue to serve until his/her successor is appointed and assumes office, except that the Executive Director shall automatically cease being an officer upon the removal or resignation of the Executive Director. (b) Each officer is subject to removal from office (with or without cause) at any time by the vote of a two-thirds majority of the Directors in office. (c) A vacancy in any office shall be filled in the same manner as the original appointment for the unexpired term thereof. SECTION 3.3 President. (a) The president is the chief executive officer of the Corporation and, subject to the actions of the Board of Directors, shall have general charge and supervision of the management of the affairs of the Corporation. TCSC--LTTS.BYLAWS — Page 3 TAM.v2.2/06/2003 (b) The President shall preside at all meetings of the Board of Directors. (c) The President shall cause all orders and resolutions of the Board of Directors to be put into effect. (d) The President shall sign and execute all legal documents and instruments in the name of the Corporation when authorized to do so by the Board of Directors; provided that the Board of Directors may delegate the signing and execution thereof to some other officer or to an agent of the Corporation. SECTION 3.4. Vice President. (a) In the event of the absence or disability of the President, the Vice President shall discharge the powers and duties of the President. (b) The Vice President shall perform such additional duties as may be assigned from time to time by the Board of Directors. SECTION 3.5. Secretary. (a) The Secretary shall have charge of the records and correspondence of the Corporation under the direction of the President. (b) The Secretary is responsible for the giving of notice of meetings of the Board of Directors. (c) The Secretary shall attend the Board of Directors meetings and shall take and keep minutes of, and record all votes cast at, the meetings. (d) The Secretary shall discharge such other duties as may be assigned from time to time by the President or the Board of Directors. SECTION 3.6. Assistant Secretary. (a) In the event of the absence or disability of the Secretary, the Assistant Secretary shall discharge the powers and duties of the Secretary. (b) The Assistant Secretary shall perform such additional duties as may be assigned from time to time by the Board of Directors. SECTION 3.7. Treasurer. (a) To the extent not otherwise provided in any resolution of the Board of Directors relating to the issuance of bonds or other obligations of the Corporation or to instruments authorized by the Board of Directors to provide security therefor, the Treasurer shall have the custody of all the funds and securities of the Corporation and shall deposit them to the credit of the Corporation in such banks or other depositories as the Board of Directors may designate. (b) The Treasurer shall keep proper books of account and other records showing at all times the amount of the funds and other property belonging to the Corporation and of all receipts and disbursements of the Corporation. TCSC--LTTS.BYLAWS — Page 4 TAM, v2.2/06/2003 (c) Under the direction of the Board of Directors, the Treasurer shall disburse all money and sign all checks and other instruments drawn on or payable out of the funds of the Corporation and shall make transfers and other dispositions of the funds and securities of the Corporation as may be ordered by the Board of Directors. (d) The Treasurer shall also discharge such additional duties as may be assigned from time to time by the Board of Directors. (e) Upon the request of the President and/or the Board of Directors, the Treasurer shall render an accounting of all transactions of the Treasurer and of the financial condition of the Corporation. (f) The Treasurer shall give bond only if required to do so by the Board of Directors. SECTION 3.8. Assistant Secretary. (a) In the event of the absence or disability of the Treasurer, the Assistant Treasurer shall discharge the powers and duties of the Treasurer. (b) The Assistant Treasurer shall perform such additional duties as may be assigned from time to time by the Board of Directors. SECTION 3.9. Executive Director. (a) The Executive Director shall be appointed by the President, on terms approved by the Board of Directors and consented to by the Board of Aldermen. In connection with the employment of the Executive Director, the Corporation shall enter into an employment contract with the Executive Director, which contract shall be approved by the Board of Directors and consented to by the Board of Aldermen. (b) The Executive Director shall (i) report and be accountable to the Board of Directors, the Board of Aldermen, and the President, carry out instructions given by the President, and (iii) be subject to removal (for cause or without cause) at anytime by the President and/or the Board of Directors. (c) If the Executive Director is removed, the Corporation shall hire, as a successor Executive Director, the person appointed by the President on terms approved by the Board of Directors and consented to by the Board of Alden -nen. (d) Without any action by the Board of Directors, the Executive Director shall serve ex officio as both Assistant Secretary and Assistant Treasurer. TCSC--LTTS.BYLAWS — Page 5 TAM.v2.2/06/2003 SECTION 3. 10. Compensation of Officers. Officers who are not Directors may receive compensation for their services as officers on terms approved by the Board of Directors. ARTICLE IV MEETINGS SECTION 4.1. Meetinas of Directors. (a) The Board of Directors shall hold its meetings at the principal office of the Corporation; provided that, if the President determines that, with respect to any regular or special meeting, an alternative meeting place is appropriate, the President may designate an alternative place for such meeting. (b) The time and place of each meeting of the Board of Directors shall be provided in each notice of meeting. (c) Regular meetings of the Board of Directors shall be held at the times designated by resolution of the Board of Directors. (d) Special meetings of the Board of Directors shall be held whenever called by the President or the Secretary or by the Board of Directors at the time and place specified by the officer calling the special meeting. (e) Unless otherwise indicated in the notice of a special meeting, any matter that may be acted upon by the Board of Directors at a regular meeting may be acted upon at a special meeting. (f) Except as otherwise provided by law, notice to Directors of a regular meeting is not required. Notice of the time and place of each special meeting shall be given to each Director (either by personal delivery, United States mail, telephone, telecopy, or any other lawful means) not later than two hours in advance of the meeting. Notice of any Board of Directors meeting to persons other than Directors shall be given if and to the extent required by law. (g) Attendance by a Director at a meeting shall constitute a waiver by the Director of any notice of meeting, unless the Director attends the meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called or convened. A waiver of a notice in writing, signed by any person entitled to notice (whether before or after the time for giving the notice) shall be deemed to be the equivalent to the giving of notice. SECTION 4.2. Quorum. A majority of the number of Directors fixed by these bylaws as constituting the Board of Directors shall constitute a quorum for the transacting of the business of the Corporation. The act of a majority of the Directors present at a meeting at which a quorum is in attendance shall constitute the act of the Board of Directors except as otherwise required by law or by these Bylaws or the Articles. TCSC--LTTS.BYLAWS -- Page 6 TAM.v2.2/06/2003 SECTION 4.3. Order of Business. The Board of Directors shall consider the matters before it in such order as the presiding officer ofthc Board of Directors may determine. ARTICLE V ADMINISTRATION SECTION 5.1. St_ of in . (a) Upon the recommendation of the President and the approval of the Board of Directors, the Corporation may hire full or part-time employees to carry out the functions of the Corporation. (b) Staff functions of the Corporation may be performed by employees of the Town if and to the extent approved by the Board of Aldermen and if the Town is reimbursed for all actual costs of the performance of the staff functions. (c) The Executive Director shall be the senior staff member of the Corporation, and all employees of the Corporation shall report to the Executive Director. SECTION 5.2. Engagement of Consultants. (a) To assist the Corporation in acquiring, financing, and managing the Corporation's projects and administering the Student Assistance Program and other activities of the Corporation, the Corporation shall retain a general counsel (the "General Counsel"), a finance counsel (the "Finance Counsel"), a special finance counsel (the "Special Finance Counsel"), a financial adviser (the "Financial Adviser"), and a real estate and finance consultant (the "Real Estate and Finance Consultant"). Collectively, the General Counsel, the Finance Counsel, the Special Finance Counsel, the Financial Adviser, and the Real Estate and Finance Consultant shall be referred to as the "Consultants." (b) Each of the Consultants shall be designated by resolution of the Board of Directors and the Board of Aldermen and shall be responsible directly to the President, the Board of Directors, and the Board of Aldermen. (e) Each of the Consultants shall be employed pursuant to a written agreement that (i) shall preclude the Consultants from having any conflicts -of -interest with either the Corporation or the Town and (ii) shall prescribe the compensation payable to the Consultant. With respect to the relationship between the Corporation and the Town, the interest of the Town shall be paramount. (f) The General Counsel shall not be compensated for services rendered. (g) Each Consultant entitled to compensation shall be compensated on the basis of effort and, as a condition to being compensated, shall furnish the Board of Directors with a written statement that describes in reasonable detail the services rendered, the number of hours spent in rendering the services, and the amount charged for the services. SECTION 5.3. Responsibilities of Executive Director. The Executive Director shall be responsible for the following: TCSC--LTTS.BYLAWS — Page 7 TAM.v2.2/06/2003 (a) If the Corporation has oversight responsibilities, including, but not limited to, approval of budgets, monitoring the performance of the Corporation's property manager(s) (if any), obtaining insurance, and other related matters, for any project that the Corporation has financed and/or owns, the Executive Director, with respect to the provisions that are contained in the documents governing the acquisition, financing, operations, and management of the project (collectively, such documents shall be referred to as the "Project Administration Documents"), shall certify in writing to the Board of Directors at least once each calendar quarter the following: (i) the Corporation is in compliance with all material requirements applicable to the Corporation that are contained in the Project Administration Documents, (ii) the project is being managed by the Corporation's property manager(s) in compliance the Project Administration Documents, (iii) the budget for the project has been timely submitted to the Board of Directors and is in compliance with the Project Administration Documents, and (iv) such other matters as may be requested by the President and/or the Board of Directors. (b) If the Executive Director is unable to certify to the matters referred to in Section 5.3(a) above, the Executive Director shall provide a written statement to the President stating in reasonable detail the reasons that the Executive Director cannot make such certification. (c) No later than 60 days prior to the beginning of each fiscal year, the Executive Director shall. prepare and submit to the Board of Directors an annual budget containing all material revenues and expenses relating to all corporate activities of the Corporation. (d) With respect to any project budget that is required to be approved by the Board of Directors, the Executive Director shall make written recommendations to the Board of Directors regarding the budget. (e) The Executive Director shall provide to the Board of Directors and the Board of Aldermen a monthly transaction report showing all income received and expenses paid during each calendar month. Upon the request of the President or a majority of the Board of Directors, the Executive Director shall provide any financial report, to the extent reasonably possible, to the Board of Directors and the Board of Aldermen. (f) In performing the duties assigned to the Executive Director, the Executive Director shall confer with each of the Consultants to the extent the Executive Director believes that consultation is appropriate to assure that the duties of the Executive Director will be performed properly. SECTION 5.4. Records. (a) The Corporation shall keep complete corporate and financial records, including all banking records, and minutes of the proceedings of its Board of Directors and of committees (if any) of the Board of Directors in accordance with applicable law. (b) The records and minutes shall be made available for inspection at all reasonable times by any (i) Director, and TCSC--LTTS.BYLAWS — Page 8 TAM.v2.2106/2003 (ii) Town representative authorized by the Board of Aldermen. (c) The Secretary and Assistant Secretary, under the supervision of the Executive Director, shall be responsible for keeping and maintaining the Corporation's records. SECTION 5.5. Authorization to Write Checks. The President, the Treasurer, the Executive Director, and the Assistant Treasurer each shall be authorized to write checks on behalf of the Corporation from any bank or trust account maintained by the Corporation for any purpose authorized by the Board of Directors; provided that, with respect to any check in excess of $5,000, the check must be signed by two officers at least one of which must be a Director. SECTION 5.6. Administrative Fees. The Corporation may prescribe fees payable by applicants for financial participation and/or assistance by the Corporation and such other fees and charges as the Board of Directors determines appropriate to defray the administrative expenses incurred in the operation of the Corporation or to be used for any other lawful purposes. SECTION 5.7. Fiscal Year. The fiscal year of the Corporation shall be the annual period determined by resolution of the Board of Directors. SECTION 5.8. Amounts Owning to Town. The Corporation shall pay any amounts owed to the Town for permitting its employees to provide staffing for the Corporation upon receipt (or as promptly thereafter as practicable) from any of its funds available for such payment. ARTICLE VI MISCELLANEOUS PROVISIONS SECTION 6.1. Time for Taking Effect.. These Bylaws shall take effect upon their adoption by the Board of Aldermen and the Board of Directors. SECTION 6.2. Seal. The official seal of the Corporation shall be as determined by the Board of Directors. The seat shall not be necessary to the proper execution by the officers of the Corporation of any document or instrument unless otherwise specified by the Board of Directors. TCSC--LTTS.BYLAWS — Page 9 TAM.v2.2/0612003 SECTION 6.3. Amendments. These Bylaws may be amended at any time, and from time to time, by resolution of the Board of Directors, which amendment shall not take effect until approved by the governing body of the Town. SECTION 6.4. Interpretation. These Bylaws shall be liberally construed to effect the purposes of the Corporation. If any part of these Bylaws is ruled invalid by a court of competent jurisdiction, the remainder of these Bylaws shall remain in effect to the fullest extent possible under the application of such ruling. References in these Bylaws to the singular number shall include the plural and vice versa (unless the context otherwise requires). SECTION 6.5. Special Requirements. The Corporation shall comply with the following special requirements: (a) The Corporation shall maintain its books and records separate and apart from any other legal entity. (b) The Corporation shall not commingle its assets with the assets of any other legal entity. (c) The Corporation shall maintain financial records separate from any other legal entity. (d) The Corporation shall maintain an "arms -length" relationship with all other legal entities except as otherwise may be required by law. (e) The Corporation shall pay the salaries of its own employees. TCSC--LTTS.BYLAWS —Page 10 TAM.v2.2/06/2003