Loading...
09-07-05-Resolution-Lease Purchase Agreement with Government Capital Corporation Utility Metering System-09/19/2005RESOLUTION NO. 09-07-05 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANGER, TEXAS, APPROVING A LEASE PURCHASE AGREEMENT, ATTACHED AS EXHIBIT "A", FOR THE PURPOSE OF PROCURING A "UTILITY METERING SYSTEM"; AUTHORIZING THE CITY MANAGER TOEXECUTE THE AGREEMENT ON BEHALF OF THE CITY; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Sanger, Texas ("the City"), subject to review by the City's legal counsel, desires to enter into that certain Lease -Purchase Agreement dated as of September 19, 2005 by and between the City and Government Capital Corporation ("GCC"), for the purpose of procuring said UTILITY METERING SYSTEM ("the Project"); NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SANGER, TEXAS: Section 1. That the City enter into a Lease -Purchase Agreement with Government Capital Corporation, attached hereto as Exhibit "A" and made part hereof for all purposes, for the purpose of procuring the UTILITY METERING SYSTEM described therein. Section 2. That the Lease -Purchase Agreement dated as of S e p t emb e r 19 , 2005, by and between the City and Government Capital Corporation is designated by the City as a "qualified tax-exempt obligation" for the purposes of Section 265 (b) (3) of the Internal Revenue Code of 1986, as amended. Section 3. That, City Manager, is hereby authorized to sign the Lease -Purchase Agreement on behalf of the City of Sanger. Section 4. This Resolution shall take effect from and after its passage, and it is accordingly so resolved. PASSED AND APPROVED by the City Council of Sanger, Texas in a meeting held on the 19 th of September 2005, APPROVED: Tommy ATTEST: Rose Chavez, City w!s L"" Y ry R'•ti%b t r ey oeM alp asp s°eae.a •000 THIS MUNICIPAL LEASE -PURCHASE AGREEMENT No.4O15 (hereafter referred to as "Agreement") dated as of September 19, 2005, by and between Government Capital Corporation, a Texas corporation (herein referred to as Lessor"), and City of Sanger, a political subdivision or agency of the State of Texas (hereinafter referred to as "Lessee"). WITNESSETH: In consideration of the mutual covenants and conditions hereinafter set forth, the parties hereto agree as follows: 1. Term and Payments. Lessor hereby leases to Lessee and Lessee hereby leases from Lessor the property described in Exhibit A hereto (hereinafter, with all replacement parts, substitutions, proceeds, increases, additions, accessions, repairs and accessories incorporated therein or affixed thereto, referred to as the "Property") for the amounts to be paid in the sums (the "Lease Payments") and on the dates (the "Lease Payment Dates") set forth in Exhibit B hereto. Except as specifically provided in Section 2 hereof, the obligation of the Lessee to make the Lease Payments called for in Exhibit B hereto shall be absolute and unconditional in all events and shall not be subject to any set-off, defense, counterclaim or recoupment for any reason. The term of the lease hereunder shall commence upon the dated date of the lease and shall continue until the end of the Lessee's current fiscal period and thereafter for such additional fiscal periods as are necessary to complete the anticipated total lease term as set forth in Exhibit B, unless earlier terminated as provided herein. The interest rate and payments under this Agreement may be adjusted by the Lessor, or its Assigns, on the fifth 51h) anniversary of the agreement (each, an "Adjustment Date". Notice of any rate adjustment shall be given in writing to the Lessee on or before the 30`h business day prior to such rate adjustment (the "Determination Date"). The interest rate shall be adjusted to the five year treasury rate on the Determination Date, plus 66 basis points. "Treasury Rate" shall mean, as of the Determination Date, the ask yield of the United States Treasury obligations (as compiled by and published in the most recently published issue of the Wall Street Journal). Upon any rate adjustment, the future installments of principal and interest payable under this Agreement shall be adjusted. Any such adjustment shall be set forth in a new amortization schedule which the Lessor, or its Assignee, shall prepare using the same format as used to produce the original amortization schedule. Once the amortization schedule is prepared, the Lessor or its Assignee, shall attach it to the Agreement and shall deliver a copy of same to the Lessee. 2. Renewal and Non -Appropriation. Lessee agrees that it will take all necessary steps and make timely requests for the appropriation of funds to make all Lease Payments called for under Exhibit B, and use its best efforts and take all steps to cause such appropriations to be made. In the event that (i) funds for the succeeding fiscal period cannot be obtained, (H)Lessee has exhausted all legally available means for making payment called for under this Agreement, (iii) Lessee has invoked and diligently pursued all legal procedures by which payment called for under this agreement may be made, (iv) such failure to obtain funds has not resulted from any act or failure to act of Lessee, v) Lessee has not acquired, and has no intent to acquire during the subsequent fiscal period, items of property having functions similar to those of the Property or which provide similar benefits to Lessee, and (vi) no funds have been appropriated for the acquisition of such property, Lessee may terminate this Agreement at the end of any fiscal period during the payment schedule set forth in Exhibit B by giving notice to Lessor or its successors at least sixty (60) days prior to the first day of such fiscal period for which appropriations cannot be made. Such failure to obtain proper appropriation and approval of the full amount of funds necessary to make required payments hereunder during any fiscal period subsequent to the current fiscal period shall terminate all Lessee's right, title and interest in and obligations under this Agreement and to all the Property, effective on the last day of the last fiscal period for which appropriation or approval was properly obtained. 3. Taxes. In addition to the Lease Payments to be made pursuant to Section 1 hereof, Lessee agrees to indemnify and hold Lessor harmless from and against and to pay Lessor, as additional rent, on demand, an amount equal to all licenses, assessments, sales, use, real or personal property, gross receipts or other taxes, levies, imposts, duties or charges, if any, together with any penalties, fines, or interest thereon imposed against or on Lessor, Lessee or the Property by any governmental authority upon or with respect to the Property or the purchase, ownership, rental, possession, operation, return or sale of, or receipt of payments for, the Property, except any Federal or state income taxes, if any, payable by Lessor. Lessee may contest any such taxes prior to payment provided such contest does not involve any risk of sale, forfeiture or loss of the Property or any interest therein. 4. Lessee's Covenants and Representations. Lessee covenants and represents as follows: a) Lessee represents, and will provide an opinion of its counsel to the effect that, it has full power and authority to enter into this Agreement which has been duly authorized, executed, and delivered by Lessee and is a valid and binding obligation of Lessee enforceable in accordance with its terms, and all requirements for execution, delivery and performance of this Agreement have been, or will be, complied with in a timely manner; b) All Payments hereunder have been, and will be, duly authorized and paid when due out of funds then on hand and legally available for such purposes; Lessee will, to the extent permitted by State law and other terms and conditions of this Agreement, include in its budget for each successive fiscal period during the term of this Agreement a sufficient amount to permit Lessee to discharge all of its obligations hereunder, and Lessee has budgeted and available for the current fiscal period sufficient funds to comply with its obligations hereunder; c) There are no pending or threatened lawsuits or administrative or other proceedings contesting the authority for, authorization of performance of, or expenditure of funds pursuant to, this Agreement; d) Information supplied and statements made by Lessee in any financial statement or current budget prior to or contemporaneously with the Agreement are true and correct; e) Lessee has an immediate need for, and expects to make immediate use of, substantially all the Property, which need is not temporary or expected to diminish in the foreseeable future; specifically Lessee will not give priority or parity in the appropriation of funds for the acquisition or use of any additional property for purposes or functions similar to those of the Property. rcucaei w-rmni i eeee.onarueec eracm our f) There are no circumstances presently affecting the Lessee that could reasonably be expected to alter its foreseeable need for the Property or adversely affect its ability or willingness to budget funds for the payment of sums due hereunder; and g) Lessee's right to terminate this Agreement as specified in Section 2 hereof was not an independently bargained for consideration, but was included solely for the purpose of complying with the requirements of the laws of the State in which Lessee is located. h) No lease, rental agreement, lease -purchase agreement, payment agreement or contract for purchase to which Lessee has been a party at any time during the past ten (10) years has been terminated by Lessee as a result of insufficient funds being appropriated in any Fiscal Year. No event has occurred which would constitute an event of default under any debt, revenue bond or obligation which Lessee has issued during the past ten (10) years. S. Use and Licenses. Lessee shall pay and discharge all operating expenses and shall cause the Property to be operated by competent persons only. Lessee shall use the Property only for its proper purposes and will not install, use, operate or maintain the Property improperly, carelessly, or in violation of any applicable law, ordinance, rule or regulation of any governmental authority, or in a manner contrary to the nature of the Property or the use contemplated by its manufacturer. Lessee shall keep the property at the location stated on the Certificate of Acceptance executed by Lessee upon delivery of the Property until Lessor, in writing, permits its removal, and the Property shall be used solely in the conduct of the Lessee's operations. Lessee shall obtain, at its expense, all registrations, permits and licenses, if any, required by law for the installation and operation of the Property. Any license plates used on the Property shall be issued in the name of the Lessee. If a certificate of title is issuable with respect to the Property, it shall be delivered to the Lessor showing the interest of the Lessor. 6. Maintenance. Lessor shall not be obligated to make any repairs or replacements. At its own expense, Lessee shall service, repair and maintain the Property in as good condition, repair, appearance and working order as when delivered to Lessee hereunder, ordinary wear and tear from proper use alone excepted, and shall replace any and all parts thereof which may from time to time become worn out, lost, stolen, destroyed, or damaged beyond repair or rendered unfit for intended use, for any reason whatsoever, all of which replacements shall be free and clear of all liens, encumbrances and claims of others and shall become part of the Property and subject to this Agreement. Lessor may, at its option, discharge such costs, expenses and insurance premiums necessary for the repair, maintenance and preservation of the Property, and all sums so expended shall be due from Lessee in addition to rental payments hereunder. 7. Alterations. a) Lessee may, at its own expense, install or place in or on, or attach or affix to, the Property such equipment or accessories as may be necessary or convenient to use the Property for its intended purposes provided that such equipment or accessories do not impair the value or utility of the Property. All such equipment and accessories shall be removed by Lessee upon termination of this Agreement, provided that any resulting damage shall be repaired at Lessee's expense. Any such equipment or accessories not removed shall become the property of Lessor. b) Without the written consent of Lessor, Lessee shall not make any other alterations, modifications or improvements to the Property except as required or permitted hereunder. Any other alterations, modifications or improvements to the Property shall immediately become part of the Property, subject to the provisions hereof. Without the prior written consent of Lessor, Lessee shall not affix or attach any of the Property to any real property. The Property shall remain personal property regardless of whether it becomes affixed or attached to real property or permanently rests upon any real property or any improvement thereon. 8. Liens. Lessee shall not directly or indirectly create, incur, assume or suffer to exist any mortgage, security interest, pledge, lien, charge, encumbrance or claim on or with respect to the Property, title thereto or any interest therein, except the respective rights of Lessor and Lessee hereunder. 9. Damage to or Destruction of Property. Lessee shall bear the entire risk of loss, damage, theft or destruction of the Property from any and every cause whatsoever, and no loss, damage, destruction or other event shall release Lessee from the obligation to pay the full amount of the rental payments or from any other obligation under this Agreement. In the event of damage to any item of the Property, Lessee will immediately place the same in good repair, with the proceeds of any insurance recovery applied to the cost of such repair. If Lessor determines that any item of Property is lost, stolen, destroyed or damaged beyond repair, Lessee, at the option of Lessee, will either (a) replace the same with like property in good repair or (b) on the next Lease Payment Date, pay Lessor (i) all amounts then owed by Lessee to Lessor under this Agreement, including the Lease Payment due on such date, and (ii) an amount equal to the applicable Option to Purchase Value set forth in Exhibit B. 10. Insurance. Lessee shall either be self -insured with regard to the Property or shall purchase and maintain insurance with regard to the Property. Lessee shall indicate on each Certificate of Acceptance executed in relation to this Agreement its election to be self -insured or company insured with regard to the Property listed on that Certificate of Acceptance. Whether Lessee is self -insured or company insured, Lessee shall, for the term of this Agreement, at its own expense, provide comprehensive liability insurance with respect to the Property, insuring against such risks, and such amounts as are customary for lessees of property of a character similar to the Property. In addition, Lessee shall, for the term of this Agreement, at its own expense, provide casualty insurance with respect to the Property, insuring against customary risks, coverage at all times not less than the amount of the unpaid principal portion of the Lease Payments required to be made pursuant to Section 1 as of the last preceding Payment Date specified in Exhibit B on which a Lease Payment was made. If insurance policies are provided with respect to the Property, all insurance policies shall be with insurers authorized to do business in the State where the Property is located and shall name both Lessor and Lessee as insureds as their respective interest may appear. Insurance proceeds from casualty losses shall be payable solely to the Lessor, subject to the provisions of Section 9. Lessee shall, upon request, deliver to Lessor evidence of the required coverages together with premium receipts, and each insurer shall agree to give Lessor written notice of non-payment of any premium due and ten (10) days notice prior to cancellation or alteration of any such policy. Lessee shall also carry and require any other person or entity working on, in or about the Property to carry workmen's compensation insurance covering employees on, in or about the Property. In the event Lessee fails, for any reason, to comply with the requirements of this Section, Lessee shall indemnify, save harmless rcucaei w wrmm i ceec.enaruncc eracckxw and, at Lessee's sole expense, defend Lessor and its agents, employees, officers and directors and the Proper y against all risk of loss not covered by insurance. 11. Indemnification. Lessee shall indemnify, to the extent permitted by law, and save harmless Lessor and its agents, employees, officers and directors from and, at Lessee's expense, defend Lessor and its agents, employees, officers and directors against all liability, obligations, losses, damages, penalties, claims, actions, costs and expenses (including but not limited to reasonable attorneys' fees) of whatsoever kind or nature which in any way relate to or arise out of this Agreement or the ownership, rental, possession, operation, condition, sale or return of the Property. All amounts which become due from Lessee under this Section 11 shall be credited with any amounts received by the Lessor from insurance provided by the Lessee and shall be payable by Lessee within thirty (30) days following demand therefor by Lessor and shall survive the termination or expiration of this Agreement. 12. No Warranty. EXCEPT FOR REPRESENTATIONS, WARRANTIES, AND SERVICE AGREEMENTS RELATING TO THE PROPERTY MADE OR ENTERED INTO BY THE MANUFACTURERS OR SUPPLIERS OF THE PROPERTY, ALL OF WHICH ARE HEREBY ASSIGNED TO LESSEE, LESSOR HAS MADE AND MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AND ASSUMES NO OBLIGATION WITH RESPECT TO THE TITLE, MERCHANTABILITY, CONDITION, QUALITY OR FITNESS OF THE PROPERTY DESCRIBED IN EXHIBIT A FOR ANY PARTICULAR PURPOSE OR THE CONFORMITY OF THE PROPERTY TO SPECIFICATION OR PURCHASE ORDER, ITS DESIGN, DELIVERY, INSTALLATION OR OPERATION. All such risks shall be borne by Lessee without in any way excusing Lessee from its obligations under this Agreement, and Lessor shall not be liable to Lessee for any damages on account of such risks. All claims or actions on any warranty so assigned shall be made or prosecuted by Lessee, at its sole expense, upon prior written notice to Lessor. Lessor may, but shall have no obligation whatsoever to, participate in such claim or action on such warranty, at Lessor's expense. Any recovery under such a warranty shall be made payable jointly to Lessee and Lessor. 13. Option to Purchase. Provided Lessee has complied with the terms and conditions of this Agreement, Lessee shall have the option to purchase not less than all of the Property which is then subject to this Agreement, "as is" at the payment date, for the Option to Purchase Values set forth in Exhibit B by giving written notice to Lessor not less than sixty (60) days prior to the date specified in Exhibit B for the exercise of such option; provided that upon Lessee's timely payment of all Lease Payments specified in Exhibit B, Lessee shall be deemed to have properly exercised its option to purchase the Property and shall be deemed to have acquired all of Lessor's right, title and interest in and to the Property, free of any lien, encumbrance or security interest except such liens, encumbrances or security interest as may be created, or permitted and not discharged, by Lessee but without other warranties. Payment of the applicable Option to Purchase Value shall occur on the applicable Lease Payment Date specified in Exhibit B hereto, at which time Lessor shall, unless not required hereunder, deliver to Lessee a quitclaim bill of sale transferring Lessor's interest in the Property to Lessee free from any lien, encumbrance or security interest except such as may be created, or permitted and not discharged, by Lessee but without other warranties. Upon Lessee's actual or constructive payment of the Option to Purchase Value and Lessor's actual or constructive delivery of a quitclaim bill of sale covering the Property, this Agreement shall terminate except as to obligations or liabilities accruing hereunder prior to such termination. 14. Default and Lessor's Remedies. a) The occurrence of one or more of the following events shall constitute an Event of Default, whether occurring voluntarily or involuntarily, by operation of law or pursuant to any order of any court or governmental agency: 1) Lessee fails to make any payment hereunder when due or within ten (10) days thereafter; 2) Lessee fails to comply with any other covenant, condition or agreement of Lessee hereunder for a period of the ten (10) days after notice thereof; 3) Any representation or warranty made by Lessee hereunder shall be untrue in any material respect as of the date made; 4) Lessee makes, permits or suffers any unauthorized assignment, transfer or other disposition of this Agreement or any interest herein, or any part of the Property or any interest therein; or 5) Lessee becomes insolvent; or admits in writing its inability to pay its debts as they mature; or applies for, consents to or acquiesces in the appointment of a trustee, receiver or custodian for the Lessee or a substantial part of its property; or, in the absence of such application, consent or acquiescence, a trustee, receiver or custodian is appointed for Lessee or a substantial part of its property and is not discharged within sixty (60) days; or any bankruptcy, reorganization, debt arrangement, moratorium, or any proceeding under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding is instituted by or against Lessee and, if instituted against Lessee, is consented to or acquiesced in by Lessee or is not dismissed within sixty (60) days. b) Upon the occurrence of any Event of Default specified herein, Lessor may, at its sole discretion, exercise any or all of the following remedies: 1) Enforce this Agreement by appropriate action to collect amounts due or to become due hereunder, by acceleration of otherwise, or to cause Lessee to perform its other obligations hereunder in which event Lessee shall be liable for all costs and expenses incurred by Lessor; 2) Take possession of the Property, without demand or notice and without court order or any process of law, and remove and relet the same for Lessee's account, in which event Lessee waives any and all damages resulting there from and shall be liable for all costs and expenses incurred by Lessor in connection therewith and the difference, if any, between the amounts to be paid pursuant to Section 1 hereof and the amounts received and to be received by Lessor in connection with any such reletting; 3) Terminate this Agreement and repossess the Property, in which event Lessee shall be liable for any amounts payable hereunder through the date of such termination and all costs and expenses incurred by Lessor in connection therewith; ncueoei inim nom 1 CAQc.oi WrWh= eroceucur 4) Sell the Property or any portion thereof for Lessor's account at public or private sale, for cash or credit, without demand on notice to Lessee of Lessor's intention to do so, or relet the Property for a term and a rental which may be equal to, greater than or less than the rental and term provided herein. If the proceeds from any such sale or rental payments received under a new agreement made for the periods prior to the expiration of this Agreement are less than the sum of (1) the costs of such repossession, sale, relocation, storage, reconditioning, reletting and reinstallation (including but not limited to reasonable attorneys' fees), (ii) the unpaid principal balance derived from Exhibit B as of the last preceding Lease Payment Date specified in Exhibit B, and (iii) any past due amounts hereunder (plus interest on such unpaid principal balance at the rate specified in Section 19 hereof, prorated to the date of such sale), all of which shall be paid to Lessor, Lessor shall retain all such proceeds and Lessee shall remain liable for any deficiency; or 5) Pursue and exercise any other remedy available at law or in equity, in which event Lessee shall be liable for any and all costs and expenses incurred by Lessor in connection therewith. "Costs and expenses," as that term is used in this Section 14, shall mean, to the extent allowed by law: (i) reasonable attorneys' fees if this Agreement is referred for collection to an attorney not a salaried employee of Lessor or the holder of this Agreement; (ii) court costs and disbursements including such costs in the event of any action necessary to secure possession of the Property; and (iii) actual and reasonable out-of-pocket expenses incurred in connection with any repossession or foreclosure, including costs of storing, reconditioning and reselling the Property, subject to the standards of good faith and commercial reasonableness set by the applicable Uniform Commercial Code. Lessee waives all rights under all exemption laws. 6) Under no circumstances shall Lessee be liable under this subsection 14 (b) for any amount in excess of the sum appropriated pursuant to Section 1 hereof for the previous and current fiscal years, less all amounts previously due and paid during such previous and current fiscal years from amounts so appropriated. 15. Termination. Unless Lessee has properly exercised its option to purchase pursuant to Section 13 hereof, lessee shall, upon the expiration of the term of this Agreement or any earlier termination hereof pursuant to the terms of this Agreement, deliver the Property to Lessor unencumbered and in at least as good condition and repair as when delivered to Lessee, ordinary wear and tear resulting from proper use alone excepted, by loading the Property, at Lessee's sole expense, on such carrier, or delivering the Property to such location, as Lessor shall provide or designate at or within a reasonable distance from the general location of the Property. If Lessee fails to deliver the Property to Lessor, as provided in this Section 15, on or before the date of termination of this Agreement, Lessee shall pay to Lessor upon demand, for the hold -over period, a portion of the total payment for the applicable period as set forth in Exhibit B prorated from the date of termination of this Agreement to the date Lessee either redelivers the Property to Lessor or Lessor repossesses the Property. Lessee hereby waives any right which it now has or which might be acquired or conferred upon it by any law or order of any court or other governmental authority to terminate this Agreement or its obligations hereunder, except in accordance with the express provisions hereof. 16. Assignment. Without Lessor's prior written consent, Lessee will not either (i) assign, transfer, pledge, hypothecate, grant any security interest in or otherwise dispose of this Agreement or the Property or any interest in this Agreement or the Property; or (fi) sublet or lend the Property or permit it to be used by anyone other than Lessee or Lessee's employees. Lessor may assign its rights, title and interest in and to this Agreement, the Property and any other documents executed with respect to this Agreement and/or grant or assign a security interest in this Agreement and the Property, in whole or in part. Any such assignees shall have all of the rights of Lessor under this Agreement. Subject to the foregoing, this Agreement inures to the benefit of and is binding upon the heirs, executors, administrators, successors and assigns of the parties hereto. No assignment or reassignment of any of Lessor's rights, title or interest in this Agreement or the Property shall be effective with regard to Lessee unless and until Lessee shall have received a copy of the document by which the assignment or reassignment is made, disclosing the name and address of such assignee. No further action will be required by Lessor or by Lessee to evidence the assignment, but Lessee will acknowledge receipt of such assignments in writing if so required. During the term of this Agreement, Lessee shall keep a complete and accurate record of all such assignments in form necessary to comply with the United States Internal Revenue Code of 1986, Section 149 (a), and the regulations, proposed or existing, from time to time promulgated thereunder. 17. Personal Property. The Property is and shall at all times be and remain personal property. 18. Title. Upon acceptance of the Property by Lessee hereunder, Lessee shall have title to the Property during the term of this Agreement; however, in the event of (1) an Event of Default hereunder and for so long as such Event of Default is continuing, or (ii) termination of this Agreement pursuant to the provisions of Section 2 hereof, title shall be reverted immediately in and shall revert to Lessor free of any right, title or interest of Lessee unless Lessor elects otherwise. 19. Lessor's Right to Perform for Lessee. If Lessee fails to make any payment or perform or comply with any of its covenants or obligations hereunder, Lessor may, but shall not be required to, make such payment or perform or comply with such covenants and obligations on behalf of Lessee, and the amount of any such payment and the expenses (including but not limited to reasonable attorneys' fees) incurred by Lessor in performing or complying with such covenants and obligations, as the case may be, together with interest thereon at the highest lawful rate, shall be payable by Lessee upon demand. 20. Interest on Default. If Lessee fails to pay any Lease Payment specified in Section 1 hereof within ten (10) days after the due date thereof, Lessee shall pay to Lessor interest on such delinquent payment from the due date until paid at the highest lawful rate. rcucaei wimir10e1 1 CACC.0110/`NECC ER0CCIJ=MT 21. Notices. Any notices to be given or to be served upon any party hereto in connection with this Agreement must be in writing and may be given by certified or registered mail, and shall be deemed to have been given and received forty-eight (48) hours after a registered or certified letter containing such notice, postage prepaid, is deposited in the United States mail, and if given otherwise shall be deemed to have been given when delivered to and received by the party to whom it is addressed. Such notice shall be given to the parties at their respective addresses designated on the signature page of this Agreement or at such other address as either party may hereafter designate. 22. Security Interest. As security for Lessee's covenants and obligations hereunder, Lessee hereby grants to Lessor, and its successors, a security interest in the Property, all accessions thereto and proceeds therefrom, and, in addition to Lessor's rights hereunder, all of the rights and benefits of a secured party under the Uniform Commercial Code as in effect from time to time hereafter in the State in which the Property is located or any other State which may have jurisdiction over the Property. Lessee agrees to execute, acknowledge and deliver to Lessor in recordable form upon request financing statements or any other instruments with respect to the Property or this Agreement considered necessary or desirable by Lessor to perfect and continue the security interest granted herein in accordance with the laws of the applicable jurisdiction. Lessee hereby authorizes Lessor or its agent/assigns to sign and execute on its behalf, any and all necessary UCC-1 forms to perfect the Purchase Money Security interest herein granted to Lessor. 23. Tax Exemption. Lessee certifies that it does reasonably anticipate that not more than $10,000,000 of "qualified tax-exempt obligations," as that term is defined in Section 265 (b) 3 (D) of the Internal Revenue Code of 1986 ("the Code"), will be issued by it and any subordinate entities during 2005. Further, Lessee designates this issue as comprising a portion of the $10 million in aggregate issues to be designated as "qualified tax exempt obligations" eligible for the exception contained in Section 265 (b) 3 (D) of the Code allowing for an exception to the general rule of the Code which provides for a total disallowance of a deduction for interest expense allocable to the carrying of tax exempt obligations. 24. Continuing Disclosure. Specifically and without limitation, Lessee agrees to provide audited financial statements, prepared by a certified public accountant not later than eight (8) months after and as of the end of each fiscal year. Periodic financial statement shall include a combined balance sheet as of the end of each such period, and a combined statement of revenues, expenditures and changes in fund balances, from the beginning of the then fiscal year to the end of such period. certified as correct by one of Lessee's authorized agents. If Lessee has subsidiaries, the financial statements required will be provided on a consolidated and consolidation basis. 25. Miscellaneous. a) Lessee shall, whenever requested, advise Lessor of the exact location and condition of the Property and shall give the Lessor immediate notice of any attachment or other judicial process affecting the Property, and indemnify and save Lessor harmless from any loss or damage caused thereby. Lessor may, for the purpose of inspection at all reasonable times enter upon any job, building or place where the Property and the books and records of the Lessee with respect thereto are located. b) Lessee agrees to equitably adjust the payments payable under this Agreement if there is a determination for any reason that the interest payable pursuant to this Agreement (as incorporated within the schedule of payments) is not excludable from income in accordance with the Internal Revenue Code of 1986, as amended, such as to make Lessor and its assigns whole. c) Time is of the essence. No covenant or obligations hereunder to be performed by Lessee may be waived except by the written consent of Lessor, and a waiver of any such covenant or obligation or a forbearance to invoke any remedy on any occasion shall not constitute or be treated as a waiver of such covenant or obligation as to any other occasion and shall not preclude Lessor from invoking such remedy at any later time prior to Lessee's cure of the condition giving rise to such remedy. Lessor's rights hereunder are cumulative and not alternative. d) This Agreement shall be construed in accordance with, and governed by, the laws of the State in which the Property is located. e) This Agreement constitutes the entire agreement between the parties and shall not be modified, waived, discharged, terminated, amended, altered or changed in any respect except by a written document signed by both Lessor and Lessee. f) Any term or provision of this Agreement found to be prohibited by law or unenforceable shall be ineffective to the extent of such prohibition or unenforceability without, to the extent reasonably possible, invalidating the remainder of this Agreement. g) The Lessor hereunder shall have the right at any time or times, by notice to Lessee, to designate or appoint any person or entity to act as agent or trustee for Lessor for any purposes hereunder. h) All transportation charges shall be borne by Lessee. Lessee will immediately notify Lessor of any change occurring in or to the Property, of a change in Lessee's address, or in any fact or circumstance warranted or represented by Lessee to Lessor, or if any Event of Default occurs. i) Use of the neuter gender herein is for purposes of convenience only and shall be deemed to mean and include the masculine or feminine gender whenever and wherever appropriate. j) The captions set forth herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. rcucaei u1 wrID61 i rAtC.GI IgrNACC erOMAPMr k) Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective heirs, executors, administrators, legal representatives, successors and assigns, where permitted by this Agreement. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day of71-in the year 2005. Lessor: Government Capital Corporation Authbrized'Signature ( v ' 345 Miron Dr. Mj4Harger Southlake, TX 76092 Director of Operations Lessee: City of Sanger Ja Smit - y Manager 20 Boll r S reet Sa , TX 6266 Witness Signature: ..-"1-"Yz- Print Name: Print Title l UL'm C P'6A Lei &O I off. Witness Signature:l oUct> Print Name:— i Print Title: V 0-/, Q lc rcucom unuiriom 1 r&QP.OI WrWAQ9 eroccucur EXHIBIT DESCRIPTION OF PROPERTY MUNICIPAL LEASE -PURCHASE AGREEMENT No. 4015 (THE "AGREEMENT") BY AND BETWEEN Lessor, Government Capital Corporation and Lessee, City of Sanger Dated as of September 19, 2005 Utility Metering System PRODUCT DESCRIPTION PART NUMBER QUANTITY AMCO C700 5/8"X3/4" positive displacement, C75834BZPBIDGILC 2350 cold water meter, bronze body, polymer bottom, poly register housing,USG digital register with 5' inline connector for an Itron 50W-2 Water Pit ERT Module AMCO C700 3/4"X3/4" same as above C734SBZPBIDGILC 28 AMCO C700 1" bronze body,bronze bottom, C71 BZBBIDGILC 29 then same as above AMCO C700 1 1/2" bronze body, then same C7112BZIDGILC 23 AMCO C700 2" same as above C72BZIDGILC 29 AMCO T3000 1 1/2" bronze turbine,same above T3112BZIDGILC25; 112BOS 1 but with 25' inline connector; bronze strainer AMCO T3000 2" bronze turbine w/ 25' ILC + T32BZIDGILC25; 2BOS 2 AMCO T3000 3" bronze turbine w/ 25' ILC + T33BZIDGILC25; 3BRS 3 AMCO T3000 4" bronze turbine w/ 25' ILC + T34BZIDGILC25; 4BRS 3 AMCO T3000 6" bronze turbine w/ 25' ILC + T36BZIDGILC25 6BRS 1 AMCO C3000 8" bronze compound with 2" C700 C38BZIDGILC25; 6BRS 1 bronze by-pass meter, both with registers as above and with 25' ILC AMCO 4" MAGMASTER WELL METER 4MMRF 2 AMCO 8" MAGMASTER WELL METER 8MMRF 1 ITRON 50W-2 WATER PIT ERT MODULE ERW-0153-501 2474 ROD MOUNT KITS FOR ERTs CFG-0010-303 2474 ITRON MV-RS 7.0 Route Management Platform MVRS7.0 1 for up to 10,000 connections ITRON FC200R Handheld with ERT Radio FC2R 3 Transceiver and standard peripherals ITRON Single Serial Desk Dock with Extra OEM-0065-051 3 Battery Charging Bay ITRON Mobile Collection Unit with Mapping MC2RM 1 FCC LICENSE FCC 1 Interface MV-RS with INCODE UBS IF 1 Training and Implementation by USM&T T&I 1 Itron Solid State Electric Meter/ w Itron ERT 2600 Itron Single Phase Solid State Demand Meter 200 PROPERTY LOCATION: Throughout the City Sanger, TX 76266 rcucoei uuuir oei iaeec.ouarueec eooeGuaur EXHIBIT B SCHEDULE OF PAYMENT'S & OPTION TO PURCHASE PRICE << MUNICIPAL LEASE -PURCHASE AGREEMENT No.4015 (THE "AGREEMENT") BY AND BETWEEN Lessor: Government Capital Corporation and Lessee: City of Sanger Dated as of September 19, 2005 PMT PMT DATE TOTAL INTEREST PRINCIPAL OPTION TO PURCHASE NO. MO. DAY YR PAYMENT PAID PAID after pmt on this line 1 09/05/06 104,454.81 39,361.30 65,093.51 N/A 2 09/05/07 104,454.81 37,116.54 67,338.27 N/A 3 09/05/08 104,454.81 33,750.30 70,704.51 626,943.48 4 09/05/09 104,454.81 30,215.78 74,239.03 547,566.41 5 09/05/10 104,454.81 26,504.57 77,950.24 465,014.26 6 09/05/11 104,454.81 22,607.84 81,846.97 379,160.02 7 09/05/12 104,454.81 18,516.31 85,938.50 289,871.61 8 09/05/13 104,454.81 14,220.24 90,234.57 197,011.66 9 09/05/14 104,454.81 9,709.42 94,745.39 100,437.32 10 09/05/15 104,454.81 4,973.03 99,481.78 1.00 Grand Totals 1,044,548.10 236,975.33 807,572.77 Accepted By Lessee: Ja Smit , City Manager rcwp AAI AaIAIirmaI 1 GACF.O .rWACF U 099AIPMT INCUMBENCY, INSURANCE, AND ESSENTIAL USE CERTIF IC A I MUNICIPAL LEASE -PURCHASE AGREEMENT No.4015 (THE "AGREEMENT") BY AND BETWEEN Lessor, Government Capital Corporation and Lessee, City of Sanger Dated as of September 19, 2005 I, Rose Chavez (NAME), do hereby certify that I am the duly elected or appointed and acting City Secretary (Keeper of the Records) (TITLE), of City of Sanger, a political subdivision or agency duly organized and existing under the laws of the State of Texas, that I have custody of the records of such entity, and that, as of the date hereof, the individual(s) named below are the duly elected or appointed officer(s) of such entity holding the office(s) set forth opposite their respective name(s). I further certify that (i) the signature(s) set opposite their respective name(s) and title(s) are their true and authentic signature(s), and (ii) such officers have the authority on behalf of such entity to enter into that certain Municipal Lease -Purchase Agreement dated as of September 19, 2005, between such entity and Government Capital Corporation. Name Title Sig ature 12 Jack Smith City Manager IN WITNESS WHEREOF, I have duly executed this certificate and affixed t e s I of s ch entity hereto this `f .2! day of 2005. BY: Ll-L (—A Rose Chavez, City Secretary Lessee certifies that property and liability insurance, if applicable, have been secured in accordance with the Agreement and such coverage will be maintained in full force for the term of the Agreement. "Lessor or its Assigns" should be designated as loss payee until Lessee is notified, in writing, to substitute a new loss payee. The following information is provided about insurance: INSURANCE COMPANY/AGENT'S NAME: I INSURANCE COMPANY ADDRESS: o &y PHONE NUMBER: X 7J(J(/ ' 53, POLICY NUMBER Y -/ /3 I, Jack Smith, City Manager, of City of Sanger ("Lessee"), hereby certify that the Equipment to be leased to the undersigned under the certain Lease Agreement, dated as of September 19, 2005, between such entity and Government Capital Corporation ("Lessor"), will be used by the undersigned Lessee for the following purpose: (PLEASE FILL OUT PRIMARY USE BELOW) PRIMARY USE:X w*i 4oK & The undersigned hereby represents that the use of the Equipment is essential to its proper, efficient and economic operation. ;( IN WITNESS WHEREOF, I have set my hand this L1 ` day ofV 0 T , 2005. rC"90e1 Ill iuirIDAI I CACC.CI IOrNECC Ar PGPUF"T CERTIFICATE OF ACCEPTANCE MUNICIPAL LEASE -PURCHASE AGREEMENT No. 4015 (THE "AGREEMENT") BY AND BETWEEN Lessor, Government Capital Corporation and Lessee, City of Sanger Dated as of September 19, 2005 1. ACCEPTANCE: In accordance with the Agreement, Lessee hereby certifies that all of the Property described herein i) has been received by Lessee, (ii) has been thoroughly examined and inspected to the complete satisfaction of Lessee, iii) had been found by Lessee to be in good operating order, repair and condition, (iv) has been found to be of the size, design, quality, type and manufacture specified by Lessee, (v) has been found to be and is wholly suitable for Lessee's purposes, and (vi) is hereby unconditionally accepted by Lessee, in the condition received, for all purposes of this Agreement. 2. PROPERTY: UTILITY METERING SYSTEM, SEE ATTACHED EXHIBIT A. 3. USE: The primary use of the Property is as follows: (PLEASE FILL OUT PRIMARY USE BELOW) PRIMARY USE: 4. PROPERTY LOCATION: Throughout the City Sanger, TX 76266 5. INVOICING: Invoices shall be sent to the following address, including to whose attention invoices should be directed: Attention: Rose Chavez Post Office Box 1729 201 Boliver Street Sanger, TX 76266 6. INSURANCE: Lessee certifies that property and liability insurance have been secured in accordance with the Agreement and such coverage will be maintained in force for the term of the Agreement. Lessor will be designated as loss payee until Lessee is notified, in writing, to substitute a new loss payee. Company Insured Agreement). Election to self -insure (in accordance with Section 10 of the X7. MAINTENANCE: In accordance with Section 6 of the Agreement, Lessee agrees to, at its own expense, service, repair and maintain the Property for the term of the Agreement as follows: Maintenance Contract Election to self -maintain ACCEPTED on this the Y 9( day of Y p Gov e , 2005. rcuconi ui PAeC. iiuruneo erOMA910r NICHOLS, JACKSON, DILLARD, HAGER & SMITH, L.L.P. Robert L. Dillard, III rdillard@njdhs.com Rosalie Chavez City of Sanger 201 Bolivar Street P.O. Box 1729 Sanger, Texas 76266 Attorneys & Counselors at Law 1800 Lincoln Plaza 500 North Akard Dallas, Texas 75201 214)965-9900 Fax (214) 965-0010 E-mail NJDHS@NJDHS.com October 24, 2005 ROBERT L. DILLARO. JR. (1913-2000) H. LOUIS NICHOLS LAWRENCE W. JACKSON OFCOUNSEL RE: Lease Purchase Agreement/City of Sanger and Government Capital Corporation Dear Rose: Enclosed please find the required opinion of counsel for the Lease Purchase Agreement No. 4015 between the City of Sanger and Government Capital Corporation, dated September 19, 2005. You are authorized to release this Opinion Letter to Government Capital Corporation when the Municipal Lease Purchase Agreement and all the necessary other agreements are executed by the appropriate officers of the City. I have received a copy of the City Council resolution indicating that the agreement has been duly authorized and that it will be executed and delivered by the City to Government Capital Corporation. The agreement contains a covenant and representation by the City that this agreement is a valid and binding obligation of the City enforceable in accordance with its terms and that all requirements for execution, delivery and performance of the agreement have been, or will be, complied with in a timely manner. I have also been furnished an excerpt from the budget showing appropriations sufficient to pay the first year annual payment, which I understand will come one-half from the electric fund and one-half from the water fund. I have also been furnished a copy of the Notice of Competitive Bidding. It is my understanding that this notice was published in the City's official newspaper as required by Chapter 252 of the Local Government Code. If this is incorrect, please let me know. Please let me know if there are any further questions with regard to this matter. Very truly yours, RLD/mew Enclosure 78877 MUNICIPAL LEASE -PURCHASE AGREEMENT No. 4015 (THE "ACRE=iyIENT") BY AND BETWEEN Lessor, Government Capital Corporation and Lessee, City of Sanger TAX ID #75-6000661 Dated as of September 19, 2005 THIS ESCROW AGREEMENT (the "Agreement') is made and entered into as of September 19, 2005, ("Agreement Date") by and among Government Capital Corporation ("Lessor"), City of Sanger ("Lessee") and , ("Agent'). WITNESSETH: WONS =aria 3uak Texas, NA WHEREAS, Lessor and Lessee have entered into a certain Municipal Lease -Purchase Agreement dated as of September 19, 2005, (the "Lease") pursuant to which the property more particularly described therein (the "Equipment') will be leased to the Lessee under the terms stated in the Lease; WHEREAS, Lessor and Lessee desire to make funding arrangements for the acquisition of the Equipment, and Agent agrees to serve as escrow agent for such funding and acquisition; NOW THEREFORE, in consideration of the mutual agreements and covenant herein contained and for other valuable consideration, the parties hereby agree as follows: 1. Agent shall undertake the duties and obligations of escrow agent as set forth in this Agreement. Agent shall not be deemed to be a party to the Lease. 2. Lessor has delivered to Agent the sum of $799,577.00 ("Escrow Amount') for deposit by Agent in the City of Sanger Escrow Account (the "Fund"). The Fund will be administered by Agent pursuant to the terms of this Agreement. 3. Deposits in the Fund shall be used to pay for the acquisition of the Equipment. The Equipment may be acquired as individual items or as groups of items. Agent shall make disbursements from the Fund in payment for the acquisition of each item or group of items of the Equipment promptly upon receipt of a properly executed Payment Request Form, in the form attached hereto as Exhibit A", for that portion of the acquisition of the Equipment for which payment is requested. Upon full acquisition of an item or group of items of the Equipment, any remaining cost of such item or group of items shall be disbursed promptly by the Agent upon receipt of a properly executed Acceptance Certificate and a corresponding Payment Request Form in the form attached hereto as Exhibit "A", for that portion of the Equipment for which payment is requested. Payment by Agent shall be to the payee shown on the Payment Request Form. 4. Agent will invest the Fund, as specified by Lessor, in general obligations of the United States or in obligations fully insured by the United States or in certificates of deposit of a bank which is either fully insured by an agency of the federal government or fully collateralized by such federal or federally guaranteed obligations , or in no-load money market mutual funds registered with and regulated by the Securities and Exchange Commission that includes in their investment objectives the maintenance of a stable net asset value of $1 for each share. Agent will retain in the Fund all earnings from investment of the Fund until termination of the Fund pursuant to Section 5 hereof. 5. Upon execution of one or more Certificates of Acceptance by Lessee and payment of acquisition costs by Agent for all the Equipment, this Agreement and the Funds shall terminate, and Agent shall transfer to Lessor all remaining sums in the Fund. If not terminated earlier, this Agreement and the Fund shall terminate on March 19, 2006 ("Termination Date"). In this latter event, interest accrued pursuant to investment of the Fund under the terms of Section 4 hereof and all remaining principal in the Fund shall be transferred by Agent to Lessor; Exhibit "A" attached to the Lease shall thereupon be revised to delete any nonacquired portions of the Equipment and to substitute an amended amortization payment schedule to reflect the reduced acquisition costs. 6. Lessor and Lessee may by written agreement between themselves remove the Agent, at any time and for any reason, and appoint a successor escrow agent. Such removal shall not be effective until thirty (30) days after written notice thereof if provided to Agent. 7. Agent may at any time and for any reason resign as escrow agent by giving written notice to Lessor and Lessee of its intention to resign and of the proposed date of resignation, which date shall be not less than thirty (30) days after giving Lessee and Lessor written notice of intent to resign, nor less than thirty (30) days after being appointed by Lessor and Lessee. 8. Agent shall have no obligation under the terms of this Agreement to make any disbursement except from the Fund. Agent makes no warranties or representations as to the Equipment or as to performance of the obligations of Lessor or Lessee under this Agreement or the Lease. 9. To the limited extent required to perfect the security interest granted by Lessee to Lessor in the cash and negotiable instrument from time to time comprising the Fund, Lessor hereby appoints the Agent as its security agent, and the Agent hereby accepts the appointment as security agent, and agrees to hold physical possession of such cash negotiable instruments on behalf of Lessor. 10. This Agreement may be amended by written agreement executed by all the parties. 11. This Agreement may be executed in several counterparts, each of which shall be an original. IN WITNESS WHEREOF, the parti h ve executed this A reement as of the date first written above. LESSOR: Governmen it I rp r lion BY: Authorized ' ner, arli arger LESSEE: City of (aer Director of Operations BY: Jack ith, ity M ager AGENT: j . S yarga Balk TpYas, NA BY:l t4CrO- Agent Rep, A ent Rep Title W9041 Iu IMIrIDAI 106=-_ mrueec eroeeucur Form 8038-G Rev. November 2000) Department of the Treasury Internal Revenue service Information Return for Tax -Exempt Governmental Obllgat ons Under Internal Revenue Code section 149(e) OMB No. 1545.0720 See separate Instructions. Caution: if the issue price is under $100,000, use Form 8038-GC. Reporting Authority If Amended Return, check 7ere > 1 Issuer's name 2 Issuer's employer identification number City of Sanger 3 Number and street (or P.O. box if mail is not delivered to street address) Room/suite 4 Report number 201 Boliver Street 3 -01 5 City, town, or post office, state, and ZIP code 6 Date of issue Sanger, TX 76266 11— 1> , —0 7 Name of issue 3 CUSIP number Municipal tease -Purchase Agreement # 4015 NA 9 Name and title of officer or legal representative whom the IRS may call for more information 10 Telephone number of officer or legal representative Jack Smith, City Manager 940 ) 458-7930 Type of Issue (check applicable box(es) and enter the issue price) See instructions and attach schedule 11 Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Health and hospital . . . . . . . . . . . . . . . . . . . . . . . . . 13 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Public safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Environment (including sewage bonds) . . . . . . . . . . . . . . . . . . 16 Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Utilities . . . . . . . . . . . . . . . . . . . 18 Other. Describe Utility Metering System 19 If obligations are TANS or RANs, check box If obligations are BANS, check box 20 If obligations are in the form of a lease or installment sale, check box 11 12 13 14 15 16 17 18 807,572.77 Description of Obligations. Complete for the entire issue for which this form is beinq filed. a) Final maturity date b) Issue price c) Stated redemption price at maturity d) Weighted average maturity e) Yield 211 09-05-15 807,572.77 NA 10 ears 4.999 % Uses of Proceeds of Bond Issue (including underwriters' discount) 22 Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . . . 23 Issue price of entire issue (enter amount from line 21, column (b)) . . , , , , 24 Proceeds used for bond issuance costs (including underwriters' discount) 24 NA 25 Proceeds used for credit enhancement . . . . . . . . 25 NA 26 Proceeds allocated to reasonably required reserve or replacement fund 26 NA 27 Proceeds used to currently refund prior issues . . . . . 27 NA 28 Proceeds used to advance refund prior issues . . . . . 28 NA 29 Total (add lines 24 through 28) . . . . . 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) . 22 NA 23 NA 29 NA 30 NA MTM Description of Refunded Bonds (Complete this part only for refunding bonds.) 31 Enter the remaining weighted average maturity of the bonds to be currently refunded . , . NA years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded , . , NA years 33 Enter the last date on which the refunded bonds will be called . . . . . . . . . . . NA 34 Enter the date(s) the refunded bonds were issued NA Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) 35 NA 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (see instructions) 36a NA b Enter the final maturity date of the guaranteed investment contract NA Ml 37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units 37a NA b If this issue is a loan made from the proceeds of another tax-exempt issue, check box and enter the name of the issuer and the date of the issue 38 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box 39 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . . . . . . . . . 40 If the issuer has identified a hedge, check box . . . . . . . . . . . . . . . . . . . . . . El. Under penalties u7 I decl hat I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, the re tr e, c rre , a9d complete. Sign Here p 2 ' 'Jack Smith, City Manager Sig ,. re of is er's thorized representative Date Type or print name and title For Paperwork R uctio Act otice, see page 2 of the Instructions. Cat. No. 63773S Form 8038-G (Rev. 11-2000) I/ C`OV/E',RMIMIE',MIT' CAPIITAL, November 8, 2005 Jack Smith, City Manager City of Sanger 201 Boliver Street CORPORATE OFFICE Sanger, TX 76266 345 MIRON DRIVE SOUTHLAKE, Tx 76092 RE: Municipal Lease -Purchase Agreement No.4015, dated as of September 19, 2005, by and between the City of Sanger and Government Capital8174215400 Corporation FAX 817 488 8477 Gentlemen: REGIONAL OFFICES Please be advised that Government Capital Corporation has assigned all its right, title and interest in the Agreement, and in the equipment leased thereunder, and the right to receive payments thereunder 303 HIGHWAY 51 SOUTH to WELLS FARGO BANK, NA. BROOKHAVEN, MS 39601 601 823 6000 Notification Sign all three (3) letters. Return two (2) in the envelope provided and keep one (1) for your FAX 601 823 6009 records. The purpose of this letter is to inform you that your lease agreement has been placed with Wells Fargo Bank, NA. 3405 ROCKWOOD Executed Lease Agreement ENID, OK 73703 This is your copy for your records. 580 747 1911 Insurance FAX 817 488 8477 Update your insurance coverage to include Wells Fargo Bank, NA as Loss Payee. Send, or instruct the insurance company to forward a Certificate of Insurance showing Wells Fargo 3106 LAKEFIELD WAY Bank, NA as Loss Payee, to my attention at our Corporate Office. SUGAR LAND, TX 77479 Payments 281 565 6545 Payments 1 through 10, due under the Agreement should be made to Wells Fargo Bank, MAC FAX 281 491 7820 T5415-041, 505 Main Street, Suite 400, Ft. Worth, TX 76102. Additional payment information is in the Lease Agreement, Exhibit B. 2384 HIGHWAY 59 EAST BEEVILLE, TX 78102 Sincerely, 361 362 2760 FAX 361 362 2763 Ri `•L Richard Briggs Post -Closing Coordinator ACKNOWLEDGED AND ACCEPTED: CITY Sign, Title Print Name: Jie"'Ile L.M 7W Date: YOUR PUBLIC FINANCE PARTNER"