Loading...
HomeMy WebLinkAboutCCpkt2016-11-22 AGENDA City Council Special Meeting Tuesday, November 22, 2016 @ 6:30 PM Anna City Hall, Council Chambers 111 N. Powell Parkway, Anna, Texas 75409 The City Council of the City of Anna will meet in Special Session at 6:30 PM, on November 22, 2016, at the Anna City Hall, Located at 111 North Powell Parkway (Hwy 5), to consider the f ollowing items. 1.Call to Order, Roll Call and Establishment of Quorum 2.Invocation and Pledge of Allegiance 3.Consider/Discuss/Action regarding a Resolution approving a Special Event Permit and an Agreement between the City of Anna and the Greater Anna Chamber of Commerce for the 2016 Christmas Parade. (Maurice Schwanke) a 4.Consider/Discuss/Action on an Ordinance canvassing November 8, 2016 election returns. (City Secretary) a 5.Consider/Discuss/Action on a Resolution of the Anna Community Development Corporation authorizing the issuance and sale of Sales Tax Revenue Bonds by the Corporation; Affirming a Sales Tax Remittance Agreement; and enacting other provisions relating to the subject. (Jessica Perkins) a 6.Consider/Discuss/Action on an Ordinance authorizing the issuance and sale of City of Anna, Texas General Obligation Refunding Bond, Series 2016, levying an annual ad valorem tax f or the payment of said Bond, and enacting other provisions relating to the subject. (City Manager) a 7.Consider/Discuss/Action regarding a Resolution authorizing the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. f or the purchase and installation of Advanced Metering Infrastructure. (Joseph Johnson) a 8.Consider/Discuss/Action regarding a Resolution approving a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, I nc. for the Advanced Metering Infrastucture Project. (City Manager) a 9.Adjourn. This is to certify that I, Carrie L. Smith, City Secretary, posted this agenda at a place readily accessible to the public at the Anna City Hall and on the City Hall bulletin board at or before 5:00 p.m. on November 18, 2016. ___________________________________ Carrie L. Smith, City Secretary 1. The Council may vote and/or act upon each of the items listed in this agenda. 2. The Council reserves the right to retire into exec utive session c oncerning any of the items listed on this agenda, whenever it is considered nec essary and legally justified under the Open Meeting Act. 3. Persons with a disability who want to attend this meeting who may need assistanc e should c ontact the City Secretary at 972 924-3325 two working days prior to the meeting so that appropriate arrangements c an be made. Item No. 3. City Council Agenda Staff Report Meeting Date: 11/22/2016 AGENDA IT EM : Consider/Discuss/Action regarding a Resolution approving a Special Event Permit and an Agreement between the City of Anna and the Greater Anna Chamber of Commerce f or the 2016 Christmas Parade. (Maurice Schwanke) SUM MARY: The Greater Anna Chamber of Commerce will host the annual Christmas Parade event on Saturday, December 10th, 2016. Preparation will start at approximately 9:00 a.m. with the actual parade starting at 12:00 noon. A request to close SH 5 (Powell Parkway) and Fourth Street has been approved by TxDOT. The parade will start at the Anna ISD Middle school and proceed south along Powell Parkway to 4th Street, east on 4th Street to Sherley Street, then south on Sherley Street to the Anna ISD Administration Building. The attached map identif ies the proposed route. The Parks Advisory Board recommended approval of the Special Event Permit at a special meeting held on Monday, October 24th, 2016. STAFF RECOM M ENDAT ION: Staff recommends approval of the attached Resolution and Special Event Permit. AT TACHMENT S: Description Upload Date Type Christmas Parade Resolution 11/16/2016 Resolution Exhibit 1 Special Event Agreement 11/16/2016 Exhibit Christmas Route 11/14/2016 Backup Material GACC Application 11/14/2016 Backup Material Item No. 4. City Council Agenda Staff Report Meeting Date: 11/22/2016 AGENDA IT EM : Consider/Discuss/Action on an Ordinance canvassing November 8, 2016 election returns. (City Secretary) SUM MARY: The attached Ordinance formally approves the results of the November 8, 2016 election on the City of Anna Proposition realocating a portion of the local option sales tax. The Proposition was approved by a vote of 2,217 in favor, and 1,160 in opposition. STAFF RECOM M ENDAT ION: Staff recommends approval of the attached Ordinance. AT TACHMENT S: Description Upload Date Type Election Canvass Ordinance 11/17/2016 Staff Report Item No. 5. City Council Agenda Staff Report Meeting Date: 11/22/2016 AGENDA IT EM : Consider/Discuss/Action on a Resolution of the Anna Community Development Corporation authorizing the issuance and sale of Sales Tax Revenue Bonds by the Corporation; Af f irming a Sales Tax Remittance Agreement; and enacting other provisions relating to the subject. (Jessica Perkins) SUM MARY: The Anna Community Development Corporation (CDC) has negotiated the purchase of an 85-acre tract of land generally located at the northeast corner of SH 5 and the Collin County Outer Loop. The Corporation intends to develop and market the land as a Business Park to increase employment in Anna and diversify the tax base. Af ter reviewing f inancing options, the CDC and Anna Economic Development Corporation (EDC) decided to jointly purchase the property. Both corporations will use cash toward a down payment and the CDC will finance the remainder of the purchase price with a bond. The attached resolution authorizes the CDC to issue sales tax revenue bonds f or the purchase of the property. The aggregate principal amount of the Bonds will not exceed $3,100,000. STAFF RECOM M ENDAT ION: Staff recommends approval of the attached Resolution. AT TACHMENT S: Description Upload Date Type Resolution Approving CDC Resolution 11/16/2016 Resolution Exhibit A, CDC Bond Resolution 11/17/2016 Exhibit Item No. 6. City Council Agenda Staff Report Meeting Date: 11/22/2016 AGENDA IT EM : Consider/Discuss/Action on an Ordinance authorizing the issuance and sale of City of Anna, Texas General Obligation Refunding Bond, Series 2016, levying an annual ad valorem tax for the payment of said Bond, and enacting other provisions relating to the subject. (City Manager) SUM MARY: Pursuant to a Plan of Finance presented by FirstSouthwest, the City’s financial advisor, on October 25, 2016; the City Council will consider an Ordinance authorizing the issuance of approximately $870,000 General Obligation Ref unding Bond, Series 2016 (the “2016 Bond”) in order to refinance $640,000 (which represents a portion of the currently outstanding Combination Tax and Revenue Certif icate of Obligation, Series 2007); and $165,000 (which represents a portion of the currently outstanding General Obligation Ref unding Bond, Series 2007) (the “Refunded Obligations”). Moreover, a portion of the proceeds of the 2016 Bond will be utilized to pay f inancing costs. The Ref unded Obligations currently carry a tax-exempt interest rate of 3.95%. The Refunded Obligations interest rate is scheduled to reset to 15% on February 15, 2017. February 15, 2017 is also the “call date” for the Refunded Obligations. On such “call date” the Refunded Obligations can be paid of f without penalty, it is the City’s plan to set up an escrow account with proceeds of 2016 Bond to have suf f icient f unds to pay of f the Ref unded Obligations on February 15, 2017 and avoid the interest rate reset. Pursuant to the Plan of Finance, it is expected the fixed tax-exempt interest rate on the 2016 Bond will be lower than the current 3.95% on the Ref unded Obligations. The 2016 Bond will be amortized through February 15, 2027 which represents the existing final maturity of the Refunded Obligations, there will be no extension of original maturity. The 2016 Bond early prepayment feature (call date) will be at the option of the 2016 Bond purchaser (investor). The $1,420,000 Combination Tax and Revenue Certificate of Obligation, Series 2007 was originally issued in March 2007 to finance street projects, drainage projects, signalization, landscaping, ri ght-of-way and land acquisi ti on and utility system i mprovements. The $370,000 General Obligation Refundi ng Bond, Seri es 2007 was original ly issued i n March 2007 to refinance the Limited Tax Note, Series 2006 which was a short term debt instrument issued to finance 19 acres of land at 1300 West FM 455 to be used in part for Natural Springs park. Both 2007 Refunded Obligati ons were sold to Bank of Ameri ca for a repayment term of 20 years, but a 10-year tax-exempt interest rate prici ng subject to reset in 2017. STAFF RECOM M ENDAT ION: Staff recommends approval of the attached Ordinance. AT TACHMENT S: Description Upload Date Type Ordinance Auhorizing GO Ref uding Bonds 11/17/2016 Ordinance Item No. 7. City Council Agenda Staff Report Meeting Date: 11/22/2016 AGENDA IT EM : Consider/Discuss/Action regarding a Resolution authorizing the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. f or the purchase and installation of Advanced Metering Infrastructure. (Joseph Johnson) SUM MARY: The City Council recently approved the Fiscal Year 2017 budget which included f unding assigned for the purchase and installation of Advanced Metering I nfrastructure. Advanced Metering Infrastructure (AMI) is essentially the inf rastructure necessary to allow two-way communication between a water meter and the City's utility billing system using RF and internet communication. The principal goal of AMI is to provide on-demand water consumption data. Additional benefits of AMI include increased ef f iciency and more productive use of department personnel, regular billing intervals, removal of human error, and detailed consumption data that will allow the customer to make inf ormed decisions about water use. W e estimate that Water department employees spend an average of 164 man hours per month reading water meters and on other associated tasks. The total annual cost ($36,471 labor plus $7,872 in f uel) is estimated at $44,384. This cost will increase as the number of utility customers increases. An entry level maintenance worker costs approximately $46,000 per year and works an average of 155 hours per month in the field. The AMI system would cost an estimated $1.3 million and would be financed over a ten-year period. The annual payments on the AMI system ($149,178) are approximately $59,000 more than the annual cost ($90,000) of our water meter replacement program. For just under the net annual cost of the AMI , the City could add additional staff to the Water department, but that would delay the full implementation of the more accurate and more efficient fully automated system. I n addition, the cost of manual and drive-by meter reading will increase as Anna continues to grow. The AMI project will change all the water meters during FY 2016-17 and will allow our Water department and Utility Billing staff to realize the labor saving benefits of the system within the f irst year. Over the past several months City staf f has met with various vendors that provide AMI. Our goal was to identif y the system that was most versatile, allowed for technologic advances without f ull system replacement, employed local and skilled customer service representatives, was cost ef f ective, and offered a durable and trustworthy product. The Neptune fixed-base AMI system distributed locally by HD Supply Waterworks, met or exceeded that criteria. Staff is recommending purchase and installation of the Neptune f ixed-base AMI system and will provide a more detailed briefing on the system during the regular Council meeting. The AMI system will also allow f or a customer web portal to be activated in the FY 2017-18 budget. The customer web portal has the option to provide customers with real time consumption data and customer driven consumption updates and alerts. This system will provide water customers more information and greater control over their water usage. STAFF RECOM M ENDAT ION: Staff recommends approval of the Resolution which authorizes the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. for the purchase and installation of advanced metering infrastructure. AT TACHMENT S: Description Upload Date Type Resolution approving AMI Project Agreement 11/16/2016 Resolution Exhibit 1, Master Project Agreement 11/16/2016 Exhibit Item No. 8. City Council Agenda Staff Report Meeting Date: 11/22/2016 AGENDA IT EM : Consider/Discuss/Action regarding a Resolution approving a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. f or the Advanced Metering I nf rastucture Project. (City Manager) SUM MARY: City Staf f has reviewed options for funding the Advanced Metering Infrastructure Project authorized under the FY 2016-2017 Budget. Staf f considered a traditional finance option through certificates of obligation and a lease/purchase proposal f rom US Bancorp. After evaluating the options and reviewing comments f rom the City’s Financial Advisor, Staff is recommending the approval of a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. to f inance the Project. Staff believes that the lease/purchase provides the best solution for the f or the following reasons: · Lower total cost · Faster availability of funds · No additional fees · No SEC disclosure requirements. The total cost of the Project is $1,340,009.75. The lease/purchase payments would be financed over ten (10) years at a 2% interest rate. The Lease Payment Schedule shown below requires equal annual payments of $149,178.63 over ten years. Payment No. Due Date Lease Payment Principal Portion Interest Portion Termination Amount 1 11/28/17 $149,178.63 $122,378.44 $26,800.20 NA 2 11/28/18 $149,178.63 $124,826.01 $24,352.63 $1,125,589.46 3 11/28/19 $149,178.63 $127,322.53 $21,856.11 $994,447.26 4 11/28/20 $149,178.63 $129,868.98 $19,309.66 $860,682.22 5 11/28/21 $149,178.63 $132,466.36 $16,712.28 $724,241.87 6 11/28/22 $149,178.63 $135,115.68 $14,062.95 $585,072.71 7 11/28/23 $149,178.63 $137,818.00 $11,360.64 $443,120.18 8 11/28/24 $149,178.63 $140,574.36 $8,604.28 $298,328.59 9 11/28/25 $149,178.63 $143,385.84 $5,792.79 $150,641.17 10 11/28/26 $149,178.63 $146,385.84 $2,952.07 0 T OTALS $1,491,786.33 $1,340,009.75 $151,776.58 Traditional certificates of obligation typically have a revenue and tax pledge as the security for the bond. With the lease/purchase option, the AMI equipment is the security. The lease/purchase option is subject to non-appropriation, meaning that the City would be required to return the equipment if the City failed to appropriate f unds and make the annual lease payment. Additionally, funds authorized under the lease agreement would be deposited in an interest bearing escrow account, and all payments to the vendor will be made by US Bancorp after the City has authorized payment. The analysis prepared by the Finance department Staff in September was based on the preliminary project cost estimate of $1,295,502. The actual amount is about $45,000 more that the preliminary estimate, however the analysis and conclusions are still valid. STAFF RECOM M ENDAT ION: Staff recommends approval of the attached Resolution and lease/purchase agreement. AT TACHMENT S: Description Upload Date Type Lease Purchase Agreement Resolution 11/16/2016 Resolution Exhibit 1, Lease Purchase Agreement 11/16/2016 Exhibit AMI Finance Plan Analysis 11/16/2016 Backup Material A Y{OUR} HOMETOWN AGENDA City Council Special Meeting Tuesday, November 22, 2016 @ 6:30 PM Anna City Hall, Council Chambers 111 N. Powell Parkway, Anna, Texas 75409 The City Council of the City of Anna will meet in Special Session at 6:30 PM, on November 22, 2016, at the Anna City Hall, Located at 111 North Powell Parkway (Hwy 5), to consider the following items. 1. Call to Order, Roll Call and Establishment of Quorum 2. Invocation and Pledge of Allegiance 3. Consider/Discuss/Action regarding a Resolution approving a Special Event Permit and an Agreement between the City of Anna and the Greater Anna Chamber of Commerce for the 2016 Christmas Parade. (Maurice Schwanke) 4. Consider/Discuss/Action on an Ordinance canvassing November 8, 2016 election returns. (City Secretary) 5. Consider/Discuss/Action on a Resolution of the Anna Community Development Corporation authorizing the issuance and sale of Sales Tax Revenue Bonds by the Corporation; Affirming a Sales Tax Remittance Agreement; and enacting other provisions relating to the subject. (Jessica Perkins) 6. Consider/Discuss/Action on an Ordinance authorizing the issuance and sale of City of Anna, Texas General Obligation Refunding Bond, Series 2016, levying an annual ad valorem tax for the payment of said Bond, and enacting other provisions relating to the subject. (City Manager) 7. Consider/Discuss/Action regarding a Resolution authorizing the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. for the purchase and installation of Advanced Metering Infrastructure. (Joseph Johnson) 8. Consider/Discuss/Action regarding a Resolution approving a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. for the Advanced Metering I nfrastucture Project. (City Manager) 9. Adjourn. This is to certify that I, Carrie L. Smith, City Secretary, posted this agenda at a place readily accessible to the public at the Anna City Hall and on the City Hall bulletin board at or before 5:00 p.m. on November 18, 2016. Carrie L. Smith, City Secretary 1. The Council may vote and/or act upon each of the items listed in this agenda. 2. The Council reserves the right to retire into executive session concerning any of the items listed on this agenda, whenever it is considered necessary and legally justified under the Open Meeting Act. 3. Persons with a disability who want to attend this meeting who may need assistance should contact the City Secretary at 972 924-3325 two working days prior to the meeting so that appropriate arrangements can be made. I Item No. 3. City Council Agenda Staff Report Meeting Date: 11 /22/2016 YfOUR? HOMETOWN AGENDAITEM: Consider/Discuss/Action regarding a Resolution approving a Special Event Permit and an Agreement between the City of Anna and the Greater Anna Chamber of Commerce for the 2016 Christmas Parade. (Maurice Schwanke) SUMMARY: The Greater Anna Chamber of Commerce will host the annual Christmas Parade event on Saturday, December 10th, 2016. Preparation will start at approximately 9:00 a.m. with the actual parade starting at 12:00 noon. A request to close SH 5 (Powell Parkway) and Fourth Street has been approved by TxDOT. The parade will start at the Anna ISD Middle school and proceed south along Powell Parkway to 4th Street, east on 4th Street to Sherley Street, then south on Sherley Street to the Anna ISD Administration Building. The attached map identifies the proposed route. The Parks Advisory Board recommended approval of the Special Event Permit at a special meeting held on Monday, October 24th, 2016. STAFF RECOMMENDATION: Staff recommends approval of the attached Resolution and Special Event Permit. ATTACHMENTS: Description Christmas Parade Resolution Exhibit 1 Special Event Agreement Christmas Route GACC Application Upload Date Type 11 /16/2016 Resolution 11 /16/2016 Exhibit 11 /14/2016 Backup Material 11 /14/2016 Backup Material CITY OF ANNA, TEXAS RESOLUTION NO. RESOLUTION APPROVING A SPECIAL EVENT PERMIT AND AN AGREEMENT BETWEEN THE CITY OF ANNA AND THE GREATER ANNA CHAMBER OF COMMERCE FOR THE 2016 ANNUAL CHRISTMAS PARADE WHEREAS, the Greater Anna Chamber of Commerce (the "GACC") has submitted a Special Event Permit application to conduct a Christmas Parade on Saturday, December 10`h, and WHEREAS, the City of Anna Parks Board has reviewed the application and is recommending that the City Council of the City of Anna, Texas (the "City Council") approve the Special Event Permit; and WHEREAS, according to Anna City Code of Ordinances, Part II, Article 47, the City shall enter into a Special Event Agreement (the "Agreement) incorporating the terms and conditions of said permit; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS THAT: Section 1. Recitals Incorporated The recitals set forth above are incorporated herein for all purposes as if set forth in full. Section 2. The City Council hereby approves the Special Event Permit application for the 2016 Annual Christmas Parade, and the Special Event Agreement attached hereto as Exhibit 1, incorporated herein for all purposes, and authorizes the City Manager to execute same on its behalf. The City Manager is further authorized to execute all documents and to take all other actions necessary to finalize, act under, and enforce the Agreement. PASSED by the City Council of the City of Anna, Texas, on this 22"d day of November, 2016. ATTEST: APPROVED: City Secretary Carrie L. Smith Mayor Mike Crist EXHIBIT 1 AGREEMENT FOR SPECIAL EVENT This Agreement for Special Event ("Agreement") is made by and between the City of Anna ("City"), and the Greater Anna Chamber of Commerce, Incorporated ("GACC") entered into on this 22nd, day of November, 2016. Section 1. Scope According to Anna City Code Ordinances, Part II, Article 47, Section the City enters into this Agreement with GACC for use of Powell Parkway, 4t" Street, Sherley Street and surrounding area for the Christmas Parade. Section 2. Definitions Meanings. For purposes of this Agreement, the following meanings shall apply: 1. City shall mean the City of Anna, Texas. 2. GACC shall mean the Greater Anna Chamber of Commerce, Incorporated. 3. Christmas Parade (Parade) shall mean the community event sponsored by the GACC and associated events and activities to take place in Anna, Texas on December 10t", 2016. 4. City Hall Parking Area means the parking area located at 111 North Powell Parkway. 5. Special Event means any event that operates wholly or partially within the incorporated City limits and may require the use of or assistance from any department or employee of the City, or the use of any City property. Section 3. General Requirements 3.01 Terms of Special Event Agreement The GACC has submitted a Special Event Permit application and sought authorization for the special event from the City of Anna Parks Board subject to entering into this agreement with the City. Said application is attached hereto as Exhibit A. The Council authorizes the Special Event, subject to the following restrictions, for which GACC will be responsible: Parking Restrictions: Page 1 of 6 All parking for the event will be conducted on premises designed or adapted for parking. Parking is to be prohibited on all public rights of way (shoulders, grass areas directly adjoining roadways, etc.). Event staff, signage, barricades, or a combination thereof, must be utilized to keep patrons from parking in rights of way. If parking areas are full, Event staff must be in place to direct vehicles to open parking areas. Vehicles on City/Park Property. Except for designated parking areas and other designated areas approved by the Director of Public Works, motor vehicles are prohibited from driving on City/Park property, except on designated paved parking areas and except as otherwise stated in this paragraph. At the discretion of the Director of Public Works motor vehicles may be allowed on some turf areas to deliver equipment but must be immediately removed when the delivery is complete. The City may prohibit any vehicle or trailer from driving on turf areas if in the opinion of the Director of Public Works the ground is too wet to support the weight of the vehicle. Except for small utility vehicles approved by the Director of Public Works, all motor vehicles are expressly prohibited from driving on or crossing the concrete walking trails. The applicant will ensure that all event participants observe these rules and will be responsible for paying for any damages to property caused by vehicles driven by participants of this event. Vendors and other Participants: Vendors and other persons or businesses providing entertainment or activities for the event may only locate on designated areas of the park that have been approved by the Director of Public Works. Section 4. Fees GACC represents that it has submitted a nonrefundable permit application fee in the amount fifty ($50.00) dollars, a refundable three hundred ($300.00) dollar deposit, and will pay for any additional actual costs incurred by the City in reviewing such application that exceeds said amount. Page 2 of 6 Section 5. Licenses and Permits The GACC shall obtain and pay for any and all permits, licenses, disposal fees, or any other costs required for the Parade and to fulfill this Agreement. The GACC must comply with all federal and state laws, and local ordinances while organizing and participating in the Parade. Section 6. Independent Contractor Status/ Liability/ Indemnity It is expressly understood and agreed that the City has no right of control, supervision, or direction over any work performed by the GACC relating in any way to the GACC's undertaking, promoting, operating, and performance of any other activity related to the Parade (the "Work"), including but not limited to its employees or its subcontractors, nor does the City have any control, supervision or direction of the means, methods, sequences, procedures, and techniques utilized to undertake, conduct, or complete any of the Work. There shall be no joint control over the Work. The GACC agrees to fully defend, indemnify and hold harmless the City from any claim, proceeding, cause of action, judgment, penalty, or any other cost or expense arising or growing out of, associated or in connection with the Work. The indemnification includes, but is not limited to, attorney fees incurred by the City in defending itself or in enforcing this Agreement. By entering into this Agreement, GACC waives all rights and remedies in law or in equity except to seek enforcement of specific performance of the obligations under this Agreement. This provision is not intended to and does not waive any of the City's governmental immunities, including immunity from suit and liability. Section 7. Insurance GACC shall procure and maintain for the duration of this Agreement and the Special Events insurance to cover claims for injuries to persons or damages to property, which may arise from or in conjunction with the performance of the Work or in any way related to the GACC's undertakings performed in connection with the Parade, including but not limited to coverage for GACC, its agents, representatives, employees, or subcontractors and Special Event participants, attendees and spectators. The insurance policy must be a Commercial General Liability Insurance Policy with combined single limits of liability for bodily injury and property damage of not less than $500,000 for each occurrence if the estimated attendance of the Special Event is up to a total of 4,999 persons, and $1,000,000 for each occurrence if the estimated attendance is a total of 5,000 persons or more. Failure of the GACC to maintain the required coverage is a breach of this Agreement and shall not relieve GACC of any other contractual responsibility or obligation. Each policy shall name the City as an additional insured and provide that there will be no alteration or modification which reduces coverage in any way prior to 30 days written notice being given to the City. A copy of a certificate of insurance shall be filed with the City's Secretary. Page 3 of 6 Section 8. Amendment; Termination This Agreement may not be amended or terminated except pursuant to a written instrument signed by both parties. Section 9. Notice Notice as required by this Agreement shall be in writing delivered to the parties via U.S. certified mail, return receipt requested, at the addresses listed below: City of Anna Carrie L Smith, City Secretary City of Anna 111 N. Powell Parkway Anna, Texas 75409 GACC Kevin Hall, Executive Director 218 W Fourth St Anna, Texas 75409 Each party shall notify the other in writing within 10 days of any change in the information listed in this section. Page 4 of 6 Section 10. No Waiver of Immunity Nothing in this Agreement waives any governmental immunity available to the City under Texas law. The provisions of this paragraph are solely for the benefit of the parties hereto and are not intended to create or grant any rights, contractual or otherwise, to any other person or entity. Section 11. Entire Agreement This Agreement represents the entire and integrated Agreement between the City and GACC and supersedes all prior negotiations, representations and/or agreements, either written or oral. This Agreement may be amended only by written instrument signed by both parties. Section 12. Governing Law and Venue This Agreement shall be governed by the laws of the State of Texas as to interpretation and performance. Any and all legal action necessary to enforce this Agreement shall be brought in a court of competent jurisdiction in Collin County, Texas or in the United States District Court for the Eastern District of Texas, Sherman Division. Section 13. Severability The provisions of this Agreement are severable. In the event that any paragraph, section, subdivision, sentence, clause, or phrase of this Agreement shall be found to be contrary to the law, or contrary to any rule or regulation having the force and effect of the law, such decisions shall not affect the remaining portions of this Agreement. Section 14. Contract Interpretation This Agreement is the result of negotiation between the parties, and shall, in the event of any dispute over the meaning or application of any portion thereof, be interpreted fairly and reasonably, and not to be more strictly construed against one party than another, regardless of which party originally drafted the section in dispute. Section 15. Force Majeure If a party is prevented or delayed from performing any of its obligations hereunder due to a natural or manmade event or condition not caused by such party and beyond such party's reasonable control, then such party's performance of those obligations shall be suspended until such time as the event or condition no longer prevents or delays performance. If any event or condition results in the creation of amounts of refuse in excess of ordinary amounts, then the parties Page 5 of 6 shall discuss, but shall not be bound to conclude, terms and conditions for collection of those excess amounts. Section 16. Assignment It is understood and agreed that GACC shall not assign, sublet, or transfer any of the rights and duties under the terms of this Agreement without the prior written approval of the City. Section 17. Effective Date This Agreement shall be effective upon the date first stated herein, and performance of this Agreement shall begin as soon thereafter as practicable. IN WITNESS WHEREOF, City and GACC have executed this Agreement. Kevin Hall, GACC Executive Director Philip Sanders Greater Anna Chamber of Commerce City Manager Page 6 of 6 _V M_ 1 1 5 .iw L'Wrr31 SPECIAL EVENT PERMIT APPLICATION Planning and Development Dept. 3223 N. Powell Pkwy Anna, TX 75409 cm ov uuu.nus 972-924-2616 Type of Event: ❑Carnival ❑Circus []Festival KParade ❑Tent ❑Other A licant Name: r t 2 AAWA L 0 Ali' 8 EX o F Cv M r Address: 218 w- T" T g. S t, TT-C City: N)VA State: TA Zip Code: �S p Phone#: `j'I a. - Ta 9 — S R-3 Email: Y, EV-1/N Re,4 AA/ }M F4 e-v Date: 10 *Note: Applications must be filed at least 30 da s in advance. APPLICATION FEE AND DEPOSIT REFUND INFORMATION Application Fee $50 non-refundable Deposit $300 refundable Same Information As Above if not the same, complete the next two lines Issue Deposit Refund To: Address: City: State: Zip Code ACTIVITY INFORMATION Dates of Activity: 5 ATIIe, PAY! D C. I o r 6 Reservation Time Block: n A Type of Activity (explain urpose of activity) 7 1 'AR -A OF SA1Vr L>JN ✓ p Estimated Number of People Attending Activit v v o Reservation Location: 411 f7 P-F-6r f,Ar`hPE IRcmTE'. Arts 51'.A9 owtJ1 on fAV S, f urn on H+� ST pn t Will Food and/or Beverages be on -site for the ctivit ? Yes ❑ No Will Alcohol be served or sold? ❑ Yes o if yes, include request letter If yes, please indicate who the vendors are (food and drinks): P-f'J K e-�-fl-e 6/-A- All wj?�&-jjlvr,- L*1Y ho 4 Please identify all other activities & structures (bounce house,, tents,Imusic, sports, games, etc.): f ell o/-�An1rA LA/I /A-f `/Ow%TLt / W% i r *If City Resources (Personnel, equipment and supplies) are used, the cost of Resources will be covered by the event sponsor. Ara I Item No. 4. City Council Agenda Staff Report Meeting Date: 11 /22/2016 YOUR) HOMETOWN AGENDAITEM: Consider/Discuss/Action on an Ordinance canvassing November 8, 2016 election returns. (City Secretary) The attached Ordinance formally approves the results of the November 8, 2016 election on the City of Anna Proposition realocating a portion of the local option sales tax. The Proposition was approved by a vote of 2,217 in favor, and 1,160 in opposition. STAFF RECOMMENDATION: Staff recommends approval of the attached Ordinance. ATTACHMENTS: Description Upload Date Type Election Canvass Ordinance 11 /17/2016 Staff Report CERTIFICATE FOR ORDINANCE I, the undersigned City Secretary of the City of Anna, Texas, hereby certify as follows: 1. The City Council of said City convened in Regular Session on the 22nd day of November, 2016, at the scheduled meeting place thereof, and the roll was called of the duly constituted officers and members of said City Council, to -wit: Mike Crist, Mayor John Beazley, Mayor Pro-Tem Justin Burr, Council Member Rene Martinez, Council Member Kenneth Pelham, Council Member Nathan Bryan, Council Member Lee Miller, Council Member Philip Sanders, City Manager Carrie L. Smith, City Secretary and all of said persons were present, except , thus constituting a quorum. Whereupon, among other business, the following was transacted at said meeting: a written Ordinance entitled ORDINANCE CANVASSING ELECTION RETURNS. was duly introduced for consideration and passage. It was then duly moved and seconded that said Ordinance be passed; and, after due discussion, said motion, carrying with it the passage of said Ordinance, prevailed and carried by the following vote: AYES: NOES: ABSTENTIONS: 2. A true, full and correct copy of the aforesaid Ordinance passed at the meeting described in the above and foregoing paragraph is attached to and follows this Certificate; said Ordinance has been duly recorded in the official minutes of said City Council; the above and foregoing paragraph is a true and correct excerpt from said minutes of said meeting pertaining to the passage of said Ordinance; the persons named in the above and foregoing paragraph, at the time of said meeting and the passage of said Ordinance, were the duly chosen, qualified and acting members of said City Council as indicated therein; each of said officers and member was duly and sufficiently notified officially and personally in advance, of the time, place and purpose of the aforesaid meeting and that said Ordinance would be introduced and considered for passage at said meeting; and said meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by Tex. Gov't Code Ann. ch. 551. 3. That the Mayor of said City has approved and hereby approves the aforesaid Ordinance; that the Mayor and the City Secretary of said City have duly signed said Ordinance; and that the Mayor and the City Secretary of said City hereby declare that their signing of this Certificate shall constitute the signing of the attached and following copy of said Ordinance for all purposes. SIGNED AND SEALED THE 22nd DAY OF NOVEMBER, 2016. ATTEST: Mike Crist, Mayor Carrie L. Smith, City Secretary (SEAL) Certificate for Ordinance Canvassing Election Returns for November 8, 2016 Special Election City of Anna, Texas ORDINANCE CANVASSING ELECTION RETURNS THE STATE OF TEXAS COUNTY OF COLLIN CITY OF ANNA WHEREAS, this City Council ordered an election to be held in said City on November 8, 2016 on the PROPOSITION hereinafter stated; and WHEREAS, said City Council has investigated all matters pertaining to said election, including the ordering, giving notice, officers, holding and making returns of said election; and WHEREAS, the election officers who held said election have duly made the returns of the result thereof, and said returns have been duly delivered to said City Council; and WHEREAS, it is hereby officially found and determined that the meeting at which this Ordinance was adopted was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by Chapter 551, Texas Government Code. THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS: 1. That the City Council officially finds and determines that said election was duly ordered, that proper notice of said election was duly given, that proper election officers were duly appointed prior to said election, that said election was duly held, that the City has complied with the Federal Voting Rights Act and the Texas Election Code, that due returns of the result of said election have been made and delivered, and that the City Council has duly canvassed said returns, all in accordance with law and the Ordinance calling said election. 2. That the City Council officially finds and determines that the following votes were cast at said election, on the submitted PROPOSITION by the resident, qualified electors of said City, who voted at the election: PROPOSITION The abolition of the sales and use tax within the City of Anna for the 2,217 FOR promotion and development of new and expanded business enterprises pursuant to Section 504.251, Texas Local Government Code, as amended, currently at the rate of one-half percent; the adoption of a sales and use tax within the City of Anna at the rate of one and one -quarter percent to be used for any purpose other than payment of bonds or other indebtedness, which would be an increase of one -quarter percent; and the adoption of a local sales and use tax in the City of 1,160 AGAINST Anna at the rate of three-quarters of one percent to be used for the promotion and development of new and expanded business enterprises and other public purposes pursuant to Section 505.251, Texas Local Government Code, as amended, which would be an increase of one -quarter percent; all of which would result in no net increase in the sales and use tax collected by the City of Anna. 3. That the City Council officially finds, determines and declares the result of said election to be that the PROPOSITION so submitted has received a favorable majority vote in all respects and has carried. STATE OF TEXAS § CANVASS OF THE CITY OF ANNA SPECIAL ELECTION COUNTY OF COLLIN § NOVEMBER 8, 2016 I, Bruce Sherbet, the undersigned Elections Administrator of Collin County, do hereby certify that I have made an actual check and comparison of all the ballots tabulated as voted with the Return Sheets, and the unused ballots as recorded on the Register of Official Ballots. I, therefore, make the following report of my findings from the November 8, 2016, City of Anna Special Election that was held in Collin County, Texas. I hereby certify the results to be a full, true and correct tabulation, audit and count of the votes cast in the said election. WITNESS, my hand on this the 16th day of November 2016. Bruce Sherbet Elections Administrator Collin County Election Summary Report Collin County, TX General Election November 8, 2016 Summary For Jurisdiction Wide, All Counters, Anna City Early Voting and Election Day Combined Accumulated Totals 73 of 73 Vote Centers Reporting Registered Voters 540084 - Cards Cast 3904 0.72% C Anna Proposition Total Number of Precincts 12 Precincts Reporting 12 100.0 % Vote For 1 Times Counted 3904/6110 63.9 % Total Votes 3377 Times Blank Voted 527 Times Over Voted 0 Number Of Under Votes 0 For 2217 65.65% Against 1160 34.35% Date:11/16/16 Time:10:00:47 Page:l of 1 Num. Report Precinct 214 - Num. Reporting 214 100.00% I Item No. 5. City Council Agenda Staff Report Meeting Date: 11 /22/2016 YOUR) HOMETOWN AGENDAITEM: Consider/Discuss/Action on a Resolution of the Anna Community Development Corporation authorizing the issuance and sale of Sales Tax Revenue Bonds by the Corporation; Affirming a Sales Tax Remittance Agreement; and enacting other provisions relating to the subject. (Jessica Perkins) SUMMARY: The Anna Community Development Corporation (CDC) has negotiated the purchase of an 85-acre tract of land generally located at the northeast corner of SH 5 and the Collin County Outer Loop. The Corporation intends to develop and market the land as a Business Park to increase employment in Anna and diversify the tax base. After reviewing financing options, the CDC and Anna Economic Development Corporation (EDC) decided to jointly purchase the property. Both corporations will use cash toward a down payment and the CDC will finance the remainder of the purchase price with a bond. The attached resolution authorizes the CDC to issue sales tax revenue bonds for the purchase of the property. The aggregate principal amount of the Bonds will not exceed $3,100,000. STAFF RECOMMENDATION: Staff recommends approval of the attached Resolution. ATTACHMENTS: Description Upload Date Type Resolution Approving CDC Resolution 11 /16/2016 Resolution Exhibit A, CDC Bond Resolution 11 /17/2016 Exhibit RESOLUTION APPROVING RESOLUTION OF THE ANNA COMMUNITY DEVELOPMENT CORPORATION AUTHORIZING THE ISSUANCE AND SALE OF SALES TAX REVENUE BONDS BY THE CORPORATION; AFFIRMING A SALES TAX REMITTANCE AGREEMENT; AND ENACTING OTHER PROVISIONS RELATING TO THE SUBJECT WHEREAS, the Anna Community Development Corporation (the "Corporation") has been incorporated and exists and operates as a duly constituted authority and instrumentality of the City of Anna, Texas (the "City"), created pursuant to Section 4B of Article 5190.6 of the Revised Civil Statutes of Texas, as amended (the "Act"), and now operates under Chapters 501, 502 and 505, Texas Local Government Code; WHEREAS, by resolutions adopted by the Board of Directors of the Corporation on July 24, 2012 (the "2012 Resolutions"), the Corporation authorized the issuance of the its Sales Tax Revenue Refunding Bond, Series 2012-A and Sales Tax Revenue Bond, Series 2012-B (the "Series 2012 Bonds"); WHEREAS, there has been presented to this City Council a resolution (the "2016 Resolution", and together with the 2012 Resolutions, the "Resolutions") of the Board of Directors of the Corporation authorizing the issuance and sale of the Corporation's Sales Tax Revenue Bonds, Series 2016 for the purpose of providing funds for acquiring land in the southern portion of the City, north of the Collin County Outer Loop, to be made suitable for industrial or commercial development, in order to sell or lease such land to new or expanding businesses, in order to promote new or expanded business development within the City (the "Projects"); WHEREAS, the Corporation and the City have previously entered into that certain Sales Tax Remittance Agreement, dated as of July 24, 2012, pursuant to which sales taxes collected by the City for the benefit of the Corporation pursuant to the Act shall be transferred and deposited into a fund for the use by the Corporation in the furtherance of its authorized powers and purposes; WHEREAS, this City Council finds and determines that it is necessary and appropriate to approve the 2016 Resolution and to affirm the Sales Tax Remittance Agreement and approve any necessary modifications thereto, for the purposes hereinabove provided; Now, Therefore BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ANNA: Section 1. The recitals set forth in the preamble hereof are incorporated herein and shall have the same force and effect as if set forth in this Section. The 2016 Resolution, attached hereto as Exhibit A, is hereby approved and the issuance by the Corporation of sales tax revenue bonds in the principal amount not to exceed $3,100,000 (the "Series 2016 Bonds"), for the purposes hereinabove stated, are hereby approved as a program of the Corporation pursuant to the Act. Section 2. The Sales Tax Remittance Agreement by and between the City and the Corporation is hereby affirmed and shall continue to govern the collection of the sales and use taxes by the City for the benefit of the Corporation, at a higher rate of three-quarters of one percent. Section 3. This Resolution shall be effective immediately upon adoption. SIGNED AND SEALED this November 22"', 2016. ATTEST: City Secretary Carrie L. Smith City of Anna, Texas Mayor Mike Crist City of Anna, Texas [CITY SEAL] EXHIBIT A 2016 Resolution (See attached) RESOLUTION AUTHORIZING THE ISSUANCE AND SALE OF ANNA COMMUNITY DEVELOPMENT CORPORATION SALES TAX REVENUE BONDS, TAXABLE SERIES 2016; PROVIDING FOR THE SECURITY FOR AND PAYMENT OF SAID BONDS; AND ENACTING OTHER PROVISIONS RELATING TO THE SUBJECT THE STATE OF TEXAS E ANNA COMMUNITY DEVELOPMENT CORPORATION § WHEREAS, Anna Community Development Corporation (the "Issuer") is a non-profit industrial development corporation created, existing and governed by the Development Corporation Act, formerly Article 5190.6, Texas Revised Civil Statutes, as amended, and now operates and exists and is governed under the recodified provisions of such Act, as a Type B corporation, as such Act has been codified in Chapters 501 through 507, Texas Local Government Code, as amended (the "Act"); WHEREAS, pursuant to the authority granted in the Act and an election held in the City on November 8, 2016, the City of Anna, Texas (the "City") may impose a three-quarters of one percent sales and use tax for the benefit of the Issuer (the "Sales Tax"), to be used exclusively for the purposes set forth in the Act; WHEREAS, by resolutions adopted by the Board of Directors of the Issuer (the "Board") on July 24, 2012 (the "2012 Resolutions"), the Issuer authorized the issuance of the Issuer's Sales Tax Revenue Refunding Bond, Series 2012-A and Sales Tax Revenue Bond, Series 2012-B (the "Series 2012 Bonds"); WHEREAS, the proceeds of the bond hereinafter authorized will be used for acquiring land in the southern portion of the City, north of the Collin County Outer Loop, to be made suitable for industrial or commercial development, in order to sell or lease such land to new or expanding businesses, in order to promote new or expanded business development within the City (the "Projects"); WHEREAS, the Issuer has heretofore adopted a resolution authorizing and directing the publication of a notice of the Issuer's intent to undertake the Projects, and said notice has been duly published in a newspaper of general circulation in said Issuer, said newspaper being a "newspaper" as defined in § 2051.044, Texas Government Code; WHEREAS, the Issuer received no petition from the registered voters of the City requesting that an election be held before the Projects or projects of the general type of Projects are undertaken; WHEREAS, the bonds hereafter authorized is being issued and delivered pursuant to the Act; WHEREAS, the Issuer and the City have previously entered into that certain Sales Tax Remittance Agreement, dated as of July 24, 2012, pursuant to which sales taxes collected by the City for the benefit of the Issuer pursuant to the Act shall be transferred and deposited into a fund for the use by the Issuer in the furtherance of its authorized powers and purposes; and WHEREAS, the Issuer now desires to issue Additional Obligations pursuant to the 2012 Resolutions, which Additional Obligations will be secured by a lien on the Pledged Revenues on a parity basis with the Series 2012 Bonds. WHEREAS, it is officially found, determined, and declared that the meeting at which this Resolution has been adopted was open to the public and public notice of the time, place and subject matter of the public business to be considered and acted upon at said meeting, including this Resolution, was given, all as required by the applicable provisions of Tex. Gov't Code Ann. ch. 551; Now, Therefore BE IT RESOLVED BY THE BOARD OF DIRECTORS OF ANNA COMMUNITY DEVELOPMENT CORPORATION: Section 1. DEFINITIONS. "Act" shall mean the Development Corporation Act, formerly Article 5190.6, Texas Revised Civil Statutes, as amended, as such Act has been recodified in Chapters 501 through 507, Texas Local Government Code, as amended. "Additional Obligations" shall mean bonds, notes or other evidences of indebtedness which the Issuer reserves the right to issue or enter into, as the case may be, in the future in accordance with the terms and conditions provided in Section 14 hereof and which, together with the Series 2012 Bonds and the Bonds, are equally and ratably secured by a parity pledge of and claim on the Pledged Revenues. "Average Annual Debt Service" means that amount which, at the time of computation, is derived by dividing the total amount of Debt Service to be paid over a period of years as the same is scheduled to become due and payable by the number of years taken into account in determining the total Debt Service. Capitalized interest payments provided from proceeds or borrowings of the Issuer shall be excluded in making the aforementioned computation. "Board" shall mean the Board of Directors of the Issuer. "Bond" or "Bonds" shall mean the Anna Community Development Corporation Sales Tax Revenue Bonds, Taxable Series 2016 authorized to be issued by this Resolution. "City" shall mean the City of Anna, Texas. "Comptroller" shall mean the Comptroller of Public Accounts of the State of Texas, and any successor official or officer thereto. "Credit Facility" shall mean (i) a policy of insurance or a surety bond, issued by an issuer of policies of insurance insuring the timely payment of debt service on governmental obligations, provided that at the time of acquisition of a Credit Facility a Rating Agency having an outstanding rating on Parity Obligations would rate the Parity Obligations fully insured or guaranteed by the issuer of the Credit Facility based on the rating of the issuer of the Credit Facility in one of its two highest generic rating categories for such obligations; and (ii) a letter or line of credit issued by any financial institution, provided that a Rating Agency having an outstanding rating on the Parity Obligations would rate the Parity Obligations in one of its two highest generic rating categories for such obligations if the letter or line of credit proposed to be issued by such financial institution secured the timely payment of the entire principal amount of the Parity Obligations and the interest thereon. "Credit Facility Payment" means any payment the Issuer is obligated to make from amounts deposited in the Reserve Fund with respect to a Credit Facility. "Debt Service" means, as of any particular date of computation, with respect to any obligations and with respect to any period, the aggregate of the amounts to be paid or set aside by the Issuer as of such date or in such period for the payment of the principal of, premium, if any, and interest (to the extent not capitalized) on such obligations; assuming, in the case of obligations without a fixed numerical rate of interest, that such obligations bear, or would have borne, interest at the maximum legal per annum rate applicable to such obligations, and further assuming in the case of obligations required to be redeemed or prepaid as to principal prior to maturity, the principal amounts thereof will be redeemed prior to maturity in accordance with the mandatory redemption provisions applicable thereto. "DTC" means The Depository Trust Company, New York, New York. "DTC Participant" means securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations on whose behalf DTC was created to hold securities to facilitate the clearance and settlement of securities transactions among DTC Participants. "Fiscal Year" shall mean the fiscal year of the Issuer, being the twelve month period ending September 30 of each year. "Holder," "Registered Owner" or words of similar import means the registered owner of the Bonds from time to time as shown in the books kept by the Paying Agent/Registrar as bond registrar and transfer agent. "Investment Act" shall mean the Public Funds Investment Act, Chapter 2256, Texas Government Code, as amended. "Issuer" shall mean Anna Community Development Corporation. "Maximum Annual Debt Service" shall mean the highest amount of Debt Service due on the Parity Obligations in any Fiscal Year. "Outstanding", when used in this Resolution with respect to Parity Obligations, including the Series 2012 Bonds and the Bonds, means, as of the date of determination, all Parity Obligations theretofore sold, issued and delivered by the Issuer, except: (1) those Parity Obligations canceled or delivered to the transfer agent or registrar for cancellation in connection with the exchange or transfer of such obligations; (2) those Parity Obligations paid or deemed to be paid in accordance with the provisions of Section 17 hereof or similar provisions of any resolution authorizing the issuance of Additional Obligations. (3) those Parity Obligations that have been mutilated, destroyed, lost, or stolen and replacement obligations have been registered and delivered in lieu thereof. "Parity Obligations" shall mean, collectively, the Series 2012 Bonds, the Bonds, and Additional Obligations. "Paying Agent/Registrar" shall mean the financial institution so designated in accordance with the provisions of Section 4 of this Resolution. "Pledged Revenues" shall mean all of the Issuer's receipts of the Sales Tax, less any amounts due or owing to the Comptroller as charges for collection or retention by the Comptroller for refunds and to redeem dishonored checks and drafts, to the extent such charges and retentions are authorized or required by law. "Rating Agency" shall mean any nationally recognized municipal securities rating agency. "Required Reserve" shall mean an amount equal to Maximum Annual Debt Service; provided, however, that for in any Fiscal Year in which the amount of the Sales Tax is equal to or greater than 1.50 times the amount of the Maximum Annual Debt Service, the amount of the Required Reserve shall be $0.00. "Sales Tax" shall mean the three-quarters of one percent sales and use tax levied by the City within the boundaries of the City as they now or hereafter exist, together with any increases in the aforesaid rate if provided and authorized by the laws of the State of Texas, including specifically the Act, and collected for the benefit of the Issuer, all in accordance with the Act, including particularly Chapter 505 thereof. "Transfer Agreement" shall mean the Sales Tax Remittance Agreement dated as of July 24, 2012, between the City and the Issuer. Section 2. RECITALS, AMOUNT AND PURPOSE OF THE BONDS. (a) The recitals set forth in the preamble hereof are incorporated herein and shall have the same force and effect as if set forth in this Section. (b) The bonds of Anna Community Development Corporation (the "Issuer") are hereby authorized to be issued and delivered, in one or more series, in the aggregate principal amount not to exceed $3,100,000 for the public purpose of providing funds for acquiring land in the southern portion of the City, north of the Collin County Outer Loop, to be made suitable for industrial or commercial development, in order to sell or lease such land to new or expanding businesses, in order to promote new or expanded business development within the City, a qualified project for the purposes authorized under and pursuant to the Act, and to pay the costs incurred in connection with the issuance of the Bonds. (c) Each Bond issued pursuant to this Resolution shall be designated: "ANNA COMMUNITY DEVELOPMENT CORPORATION SALES TAX REVENUE BOND, TAXABLE SERIES 2016," and initially there shall be issued, sold, and delivered hereunder fully registered bonds, without interest coupons, payable to the respective registered owners thereof (with the initial bonds being made payable to the initial purchaser as described in Section 21 hereof), or to the registered assignee or assignees of said bonds or any portion or portions thereof (in each case, the 'Registered Owner"). The Bonds shall be in the respective denominations and principal amounts, shall be numbered, shall mature and be payable on the date or dates in each of the years and in the principal amounts, and shall bear interest to their respective dates of maturity or redemption prior to maturity at the rates per annum, as set forth in the Pricing Certificate. Section 3. DELEGATION TO PRICING OFFICER. (a) As authorized by the Act, the President of the Board of Directors and the Chief Administrative Officer of the Issuer (each, a "Pricing Officer") are hereby authorized to act on behalf of the Issuer in selling and delivering the Bonds, carrying out the other procedures specified in this Resolution, including, determining the date of the Bonds, any additional or different designation or title by which the Bonds shall be known, whether the Bonds shall be sold and delivered in one or more series and the date and sale and delivery of each such series, the principal amount to be issued, the price at which the Bonds will be sold, the years in which the Bonds will mature, the principal amounts to be payable in each of such years, the rate of interest to be borne by each such principal amount, the interest payment and record dates, the price and terms upon and at which the Bonds shall be subject to redemption prior to maturity at the option of the Issuer, as well as any mandatory sinking fund redemption provisions, procuring municipal bond insurance for the Bonds or a Credit Facility to fund the Reserve Fund, and approving modifications to this Resolution and executing such instruments, documents and agreements as may be necessary with respect thereto, and all other matters relating to the issuance, sale, and delivery of the Bonds and obtaining municipal bond insurance for all or any portion of the Bonds and providing for the terms and provisions thereof applicable to the Bonds, all of which shall be specified in the Pricing Certificate; provided that: 4 (i) the aggregate principal amount of the Bonds shall not exceed $3,100,000; (ii) the true interest cost of the series of Bonds, prior to any reset of the interest rate on the Bonds, shall not exceed % per annum; (iii) the net effective interest rate on the Bonds shall not exceed the maximum rate set forth in Chapter 1204, Texas Government Code, as amended; (iv) the final maturity of the Bonds shall not exceed February 15, 20_; and (v) the delegation made hereby shall expire if not exercised by the Pricing Officer on or prior to the 60' day following adoption of this Resolution. (b) The Pricing Officer shall determine whether the Bonds will be sold by private placement or negotiated or competitive sale. The term "Bonds" as used in this Resolution shall mean and include collectively the bond initially issued and delivered pursuant to this Resolution and all definitive or substitute bonds exchanged therefor, as well as all other substitute bonds and replacement bonds issued pursuant hereto, and the term "Bonds" shall mean any of the Bonds, unless the context clearly indicates otherwise. (c) In establishing the aggregate principal amount of the Bonds, the Pricing Officer shall establish an amount not exceeding the amount authorized in Subsection (a) hereof, which shall be sufficient in amount to provide for the purposes for which the Bonds are authorized and to pay costs of issuing the Bonds. The Bonds shall be sold with and subject to such terms as set forth in the Pricing Certificate. Section 4. CHARACTERISTICS OF THE BOND. (a) Registration, Transfer and Exchange; Authentication. The Issuer shall keep or cause to be kept at the principal trust office of paying agent/registrar designated by the Pricing Officer in the Pricing Certificate (the "Paying Agent/Registrar"), books or records for the registration of the transfer and exchange of the Bonds (the "Registration Books"), and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such registrations of transfers and exchanges under such reasonable regulations as the Issuer and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers and exchanges as herein provided. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the Registered Owner of each Bond to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall be the duty of each Registered Owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for making such registration, transfer, exchange and delivery of a substitute Bond. Registration of assignments, transfers and exchanges of a Bond shall be made in the manner provided and with the effect stated in the FORM OF BOND set forth in this Resolution. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. Except as provided in Section 4(c) of this Resolution, an authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the Paying Agent/Registrar's Authentication Certificate, and, no such Bond shall be deemed to be issued or outstanding unless such Paying Agent/Registrar's Authentication Certificate is so executed. The Paying Agent/Registrar promptly shall cancel any Bond surrendered for exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the governing body of the Issuer or any other body or person so as to accomplish the foregoing exchange of any Bond, and the Paying Agent/Registrar shall provide for the printing, execution, and delivery of a substitute Bond in the manner prescribed herein. Pursuant to Chapter 1201, Government Code, as amended, the duty of transfer of a Bond as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of said Bond, the exchanged Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Bond initially issued and delivered pursuant to this Resolution (the "Initial Bond") , approved by the Office of the Attorney General of the State of Texas (the "Attorney General") and registered by the Office of the Comptroller of Public Accounts of the State of Texas (the "Comptroller"). (b) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, all as provided in this Resolution. The Paying Agent/Registrar shall keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the Bond, shall properly and accurately record all payments on the Bonds on the Registration Books, and shall keep proper records of all exchanges of a Bond, and all replacements of a Bond, as provided in this Resolution. However, in the event of a nonpayment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the Issuer. Notice of the past due interest shall be sent at least five business days prior to the Special Record Date by United States mail, first-class postage prepaid, to the address of the Registered Owner appearing on the Registration Books at the close of business on the last business day next preceding the date of mailing of such notice. (c) In General. The Bonds (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bond to be payable only to the Registered Owner thereof, (ii) may be exchanged for another Bond, (iii) may be transferred and assigned, (iv) shall have the characteristics, (vi) shall be signed, executed and authenticated, (vi) the principal of and interest on the Bonds shall be payable, and (vii) shall be administered and the Paying Agent/Registrar and the Issuer shall have certain duties and responsibilities with respect to the Bonds, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF BOND set forth in this Resolution. The Initial Bond is not required to be, and shall not be, authenticated by the Paying Agent/Registrar, but on each substitute Bond issued in exchange for any Bond issued under this Resolution the Paying Agent/Registrar shall execute the Paying Agent/Registrar's Authentication Certificate, in the form set forth in the FORM OF BOND. (d) Paying A end ig stray. The Issuer covenants with the Registered Owners of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent and legally qualified bank, trust company, financial institution, or other entity to act as and perform the services of Paying Agent/Registrar for the Bonds under this Resolution, and that the Paying Agent/Registrar will be a single entity. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 30 days written notice to the Paying Agent/Registrar, to be effective not later than 15 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Resolution. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Bonds, to the new Paying Agent/Registrar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to the Registered Owners of the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the 0 provisions of this Resolution, and a certified copy of this Resolution shall be delivered to each Paying Agent/Registrar. (e) Authentication. Except as provided below, no Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit of this Resolution unless and until there appears thereon the Paying Agent/Registrar's Authentication Certificate substantially in the form provided in this Resolution, duly authenticated by manual execution of the Paying Agent/Registrar. It shall not be required that the same authorized representative of the Paying Agent/Registrar sign the Certificate of Paying Agent/Registrar on the Bond. In lieu of the executed Paying Agent/Registrar's Authentication Certificate described above, the Initial Bond delivered on the closing date shall have attached thereto the Comptroller's Registration Certificate substantially in the form provided in this Resolution, manually executed by the Comptroller or by his duly authorized agent, which certificate shall be evidence that the Initial Bond has been duly approved by the Attorney General and that it is a valid and binding obligation of the Issuer, and has been registered by the Comptroller. (f) Substitute PUing_A ent�/Re isgi tray. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Resolution. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Bonds, to the new Paying Agent/Registrar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each Registered Owner of the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/Registrar. (g) Book -Entry Only System. The Bonds issued in exchange for the Initial Bond (the "Definitive Bonds") shall be initially issued in the form of a separate single fully registered Bond for each of the maturities thereof and the ownership of each such Bond shall be registered in the name of Cede & Co., as nominee of The Depository Trust Company of New York ("DTC"), and except as provided in subsections (i) and 0) of this Section, all of the outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC. (h) Blanket Issuer Letter of Representations. The execution and delivery of the Blanket Issuer Letter of Representations with respect to obligations of the Issuer is hereby ratified and confirmed; and the provisions thereof shall be fully applicable to the Bonds. Notwithstanding anything to the contrary contained herein, while the Bonds are subject to DTC's Book -Entry Only System and to the extent permitted by law, the Blanket Issuer Letter ofRepresentations is hereby incorporated herein and its provisions shall prevail over any other provisions of this Resolution in the event of conflict. (i) Bonds Registered in the Name of Cede & Co. With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the Issuer and the Paying Agent/Registrar shall have no responsibility or obligation to any securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations on whose behalf DTC was created ("DTC Participant") to hold securities to facilitate the clearance and settlement of securities transactions among DTC Participants or to any person on behalf of whom such a DTC Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, the Issuer and the Paying Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a registered owner of Bonds, as shown on the Registration Books, of any notice with respect to the Bonds, or (iii) the payment to any DTC Participant or any other person, other than a registered owner of Bonds, as shown in the Registration Books of any amount with respect to principal of or interest on the Bonds. Upon delivery by DTC to the Paying Agent/Registrar of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions in this Resolution with respect to interest checks being mailed to the registered owner at the close of business on the Record date, the words "Cede & Co." in this Ordinance shall refer to such new nominee of DTC. 0) Successor Securities Depository: Transfers Outside Book -Entry Only System. In the event that the Issuer determines that DTC is incapable of discharging its responsibilities described herein and in the Blanket Issuer Letter of Representations of the Issuer to DTC or that it is in the best interest of the beneficial owners of the Bonds that they be able to obtain certificated Bonds, the Issuer shall (i) appoint a successor securities depository, qualified to act as such under Section 17A of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants ofthe appointment of such successor securities depository and transfer one or more separate Bonds to such successor securities depository or (ii) notify DTC and DTC Participants of the availability through DTC of Bonds and transfer one or more separate Bonds to DTC Participants having Bonds credited to their DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in the Registration Books in the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor securities depository, or its nominee, or in whatever name or names registered owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this Resolution. (k) Payments to Cede & Co. Notwithstanding any other provision of this Resolution to the contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect to principal of and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in the Blanket Issuer Letter of Representations of the Issuer to DTC. (1) Cancellation of Initial Bond. On the closing date, the Initial Bond, representing the entire principal amount of the Bonds, payable in stated installments to the order of the initial purchaser of the Bonds designated in Section 21hereof or its designee, executed by manual or facsimile signature of the President and Secretary of the Board of Directors of the Issuer, approved by the Attorney General, and registered and manually signed by the Comptroller, will be delivered to such purchaser or its designee. Upon payment for the Initial Bond, the Paying Agent/Registrar shall insert the Issuance Date on Bond No. T-1, shall cancel the Initial Bond, and shall deliver to DTC on behalf of such purchaser one registered Definitive Bond for each year of maturity of the Bonds, in the aggregate principal amount of all of the Bonds for such maturity, registered in the name of Cede & Co., as nominee of DTC. To the extent that the Paying Agent/Registrar is eligible to participate in DTC's FAST System, pursuant to an agreement between the Paying Agent/Registrar and DTC, the Paying Agent/Registrar shall hold the Definitive Bonds in safekeeping for DTC. Section 5. FORM OF BOND. The form of the Bonds, including the form of Paying Agent/Registrar's Authentication Certificate, the form of Assignment and the form of the Comptroller's Registration Certificate to be attached to the Initial Bond, shall be, respectively, substantially as follows, with such appropriate variations, omissions or insertions as are permitted or required by this Resolution, and with the Bond to be completed with information set forth in the Pricing Certificate. (a) Form of Bond. NO. R- UNITED STATES OF AMERICA PRINCIPAL STATE OF TEXAS AMOUNT SALES TAX REVENUE BOND TAXABLE SERIES 2016 INTEREST RATE DELIVERY DATE MATURITY DATE CUSIP NO. REGISTERED OWNER: ANNA COMMUNITY DEVELOPMENT CORPORATION (the "Issuer"), being a nonstock, nonprofit industrial development corporation organized and existing under the laws of the State of Texas, including particularly the Development Corporation Act, formerly Article 5190.6, Texas Revised Civil Statutes, as amended, and now operating, existing and governed by the recodified provisions of such Act as a Type B corporation, under such Act, as such Act has been codified in Chapters 501 through 507, Texas Local Government Code, as amended (the "Act"), and acting on behalf of the City of Anna, Texas (the "City"), for value received, promises to pay, from the sources described herein, to the registered owner specified above, or registered assigns, the principal amount specified above, and to pay interest thereon, from the Delivery Date set forth above, on the balance of said principal amount from time to time remaining unpaid, at the rate per annum set forth above, calculated on the basis of a 360-day year of twelve 30-day months. Interest is payable on and semiannually on each and thereafter to the Maturity Date specified above, or the date of redemption prior to maturity; except, if this Bond is required to be authenticated and the date of its authentication is later than the first Record Date (hereinafter defined), such principal amount shall bear interest from the interest payment date next preceding the date of authentication, unless such date of authentication is after any Record Date but on or before the next following interest payment date, in which case such principal amount shall bear interest from such next following interest payment date; provided, however, that if on the date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being exchanged is due but has not been paid, then this Bond shall bear interest from the date to which such interest has been paid in full. THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity, or upon the date fixed for its redemption prior to maturity, at the principal corporate trust office of [NAME OF PAYING AGENT/REGISTRAR], [CITY], [STATE], which is the 'Paying Agent/Registrar" for this Bond. The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof on each interest payment date by check or draft, dated as of such interest payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer required by the resolution authorizing the issuance of this Bond (the 'Bond Resolution") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such interest payment date, to the registered owner hereof, at its address as it appeared on the day of the month preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. In addition, interest may be paid by such other method, acceptable to the Paying Agent/Registrar, requested 9 by, and at the risk and expense of, the registered owner. In the event of a non-payment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five business days prior to the Special Record Date by United States mail, first-class postage prepaid, to the address of each owner of a Bond appearing on the Registration Books at the close of business on the last business day next preceding the date of mailing of such notice. ANY ACCRUED INTEREST due at maturity or upon the redemption of this Bond prior to maturity as provided herein shall be paid to the registered owner upon presentation and surrender of this Bond for payment at the principal corporate trust office of the Paying Agent/Registrar. The Issuer covenants with the registered owner of this Bond that on or before each principal payment date and interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Debt Service Fund" created by the Bond Resolution, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bonds, when due. IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday, Sunday, a legal holiday or a day on which banking institutions in the city where the principal corporate trust office of the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day that is not such a Saturday, Sunday, legal holiday or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due. THIS BOND is one of a series of Bonds dated , authorized in accordance with the Constitution and laws of the State of Texas in the principal amount of $ for the public purpose of providing funds for acquiring land in the southern portion of the City, north of the Collin County Outer Loop, to be made suitable for industrial or commercial development, in order to sell or lease such land to new or expanding businesses, in order to promote new or expanded business development within the City (the "Projects"), a qualified project for the purposes authorized under and pursuant to the Act, and to pay the costs incurred in connection with the issuance of the Bonds. ON 5 , or on any date thereafter, the Bonds of this series may be redeemed prior to their scheduled maturities, at the option of the Issuer, with funds derived from any available and lawful source, as a whole, or in part, and, if in part, the particular Bonds, or portions thereof, to be redeemed shall be selected and designated by the Issuer (provided that a portion of a Bond may be redeemed only in an integral multiple of $5,000), at a redemption price equal to the principal amount to be redeemed plus accrued interest to the date fixed for redemption. THE BONDS scheduled to mature on in the years and ( the "Term Bonds") are subject to scheduled mandatory redemption by the Paying Agent/Registrar by lot, or by any other customary method that results in a random selection, at a price equal to the principal amount thereof, plus accrued interest to the redemption date, out of moneys available for such purpose in the interest and sinking fund for the Bonds, on the dates and in the respective principal amounts, set forth in the following schedule: Term Bond Term Bond Maturity: Maturity: , Principal Principal Mandatory Redemption Date Amount Mandatory Redemption Date Amount $ , $ 10 (maturity) (maturity) The principal amount of Term Bonds of a stated maturity required to be redeemed on any mandatory redemption date pursuant to the operation of the mandatory sinking fund redemption provisions shall be reduced, at the option of the Issuer, by the principal amount of any Term Bonds of the same maturity which, at least 45 days prior to a mandatory redemption date (1) shall have been acquired by the Issuer at a price not exceeding the principal amount of such Term Bonds plus accrued interest to the date of purchase thereof, and delivered to the Paying Agent/Registrar for cancellation, (2) shall have been purchased and canceled by the Paying Agent/Registrar at the request of the Issuer at a price not exceeding the principal amount of such Term Bonds plus accrued interest to the date of purchase, or (3) shall have been redeemed pursuant to the optional redemption provisions and not theretofore credited against a mandatory redemption requirement. AT LEAST 30 days prior to the date fixed for any optional redemption of the Bonds or portions thereof prior to maturity a written notice of such redemption shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, to the Registered Owner of each such Bond at its address as it appeared on the Registration Books on the 45th day prior to such redemption date; provided, however, that the failure of the Registered Owner to receive such notice, or any defect therein or in the sending or mailing thereof, shall not affect the validity or effectiveness of the proceedings for the redemption of Bonds. By the date fixed for any such redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the required redemption price for the Bonds or portions thereof which are to be so redeemed. If such written notice of redemption is sent and if due provision for such payment is made, all as provided above, the Bonds or portions thereof which are to be so redeemed thereby automatically shall be treated as redeemed prior to their scheduled maturities, and shall not bear interest after the date fixed for redemption, and shall not be regarded as being outstanding except for the right of the Registered Owners to receive the redemption price from the Paying Agent/Registrar out of the funds provided for such payment. IF AT THE TIME OF MAILING of notice of optional redemption there shall not have either been deposited with the Paying Agent/Registrar or legally authorized escrow agent immediately available funds sufficient to redeem all the Bonds called for redemption, such notice may state that it is conditional, and is subject to the deposit of the redemption moneys with the Paying Agent/Registrar or legally authorized escrow agent at or prior to the redemption date. If such redemption is not effectuated, the Paying Agent/Registrar shall, within five days thereafter, give notice in the manner in which the notice of redemption was given that such moneys were not so received and shall rescind the redemption. ALL BONDS OF THIS SERIES are issuable solely as fully registered bonds, without interest coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond Resolution, this Bond may, at the request of the registered owner or the assignee or assignees hereof, be assigned, transferred, converted into and exchanged for a like aggregate principal amount of fully registered Bonds, without interest coupons, payable to the appropriate registered owner, assignee or assignees, as the case may be, having the same denomination or denominations in any integral multiple of $5,000 as requested in writing by the appropriate registered owner, assignee or assignees, as the case may be, upon surrender of this Bond to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in the Bond Resolution. Among other requirements for such assignment and transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar, together with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond or any portion or portions hereof in any integral multiple of $5,000 to the assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed on this Bond may be executed by the registered owner to evidence the assignment hereof, but such method is not exclusive, and other instruments of assignment satisfactory to the Paying 11 Agent/Registrar may be used to evidence the assignment of this Bond or any portion or portions hereof from time to time by the registered owner. The Paying Agent/Registrar's reasonable standard or customary fees and charges for assigning, transferring, converting and exchanging any Bond or portion thereof will be paid by the Issuer. In any circumstance, any taxes or governmental charges required to be paid with respect thereto shall be paid by the one requesting such assignment, transfer, conversion or exchange, as a condition precedent to the exercise of such privilege. The Paying Agent/Registrar shall not be required to make any such transfer, conversion, or exchange (i) during the period commencing with the close of business on any Record Date and ending with the opening ofbusiness on the next following principal or interest payment date, or (ii) with respect to any Bond or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date.. IN THE EVENT any Paying Agent/Registrar for this Bond is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Resolution that it promptly will appoint a competent and legally qualified substitute therefor, and cause written notice thereof to be mailed to the registered owner of the Bond. THIS BOND shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Bond Resolution until the Paying Agent/Registrar's Authentication Certificate shall have been executed by the Paying Agent/Registrar or the Comptroller's Registration Certificate hereon shall have been executed by the Comptroller of Public Accounts of the State of Texas. IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly authorized, issued, sold, and delivered; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond have been performed, existed, and been done in accordance with law; that this Bond is a special obligation of the Issuer; that neither the State of Texas, the City, nor any political corporation, subdivision, or agency of the State of Texas, nor any member of the Board of Directors of the Issuer, either individually or collectively, shall be obligated to pay the principal of or the interest on this Bond and neither the faith and credit nor the taxing power (except as described below) of the State of Texas, the City, or any other political corporation, subdivision, or agency thereof is pledged to the payment of the principal of or the interest on this Bond, and all additional bonds issued on a parity therewith; that the principal of and interest on this Bond are secured by and payable from a first lien on and pledge of certain funds created under the Bond Resolution and the revenues defined in the Bond Resolution as the "Pledged Revenues", which include the proceeds of a three- quarters of one percent sales and use tax levied for the benefit of the Issuer by the City (the "Sales Tax") pursuant to Chapter 505 of the Act; and that the Registered Owners hereof shall not have the right to demand payment of the principal of or interest on this Bond from any tax proceeds other than the Sales Tax proceeds levied for the benefit of the Issuer by the City pursuant to Chapter 505 of the Act, or from any other source. THE ISSUER HAS RESERVED the right in the Bond Resolution, subject to certain conditions set forth therein, to issue obligations or incur indebtedness from time to time in the future on a parity with the Bond with respect to the pledge of and lien on the Pledged Revenues which secures the Bonds. The Issuer may also issue obligations or incur indebtedness which is secured on a junior and subordinate lien with respect to the Pledged Revenues THE ISSUER HAS RESERVED THE RIGHT to amend the Bond Resolution as provided therein, and under some (but not all) circumstances amendments thereto must be approved by the registered owners of the Bonds. BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all of the terms and provisions of the Bond Resolution, agrees to be bound by such terms and provisions, acknowledges that the Bond Resolution is duly recorded and available for inspection in the official minutes 12 and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and the Bond Resolution constitute a contract between each registered owner hereof and the Issuer. IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile signature of the President of the Board of Directors of the Issuer and countersigned with the manual or facsimile signature of the Secretary of the Board of Directors of said Issuer. (si ng ature) (si ng ature) Secretary, Board of Directors President, Board of Directors (b) Form of Paying Agent/Registrar's Authentication Certificate. PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE (To be executed if this Bond is not accompanied by an executed Registration Certificate of the Comptroller of Public Accounts of the State of Texas) It is hereby certified that this Bond has been issued under the provisions of the Bond Resolution described in the text of this Bond; and that this Bond has been issued in replacement of, or in exchange for, a Bond that originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. Dated: (c) Form of Assi ng ment. [NAME OF PAYING AGENT/REGISTRAR] [CITY], [STATE] Paying Agent/Registrar LN Authorized Representative ASSIGNMENT Please print or type clearly For value received, the undersigned hereby sells, assigns and transfers unto: Transferee's Social Security or Taxpayer Identification Number: Transferee's name and address, including zip code: the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints , attorney, to register the transfer of the within Bond on the books kept for registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: 13 NOTICE: Signature(s) must be guaranteed by an NOTICE: The signature above must correspond with eligible guarantor institution participating in a the name of the registered owner as it appears upon securities transfer association recognized signature the front of this Bond in every particular, without guarantee program. alteration or enlargement or any change whatsoever. (d) Form of Comptroller's Registration Certificate. COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. I hereby certify that this Bond has been examined, certified as to validity and approved by the Attorney General of the State of Texas, and that this Bond has been registered this day by me. Witness my signature and seal this Comptroller of Public Accounts of the State of Texas (COMPTROLLER'S SEAL) (e) Initial Bond Insertions. (i) The initial Bond shall be in the form set forth is paragraph (a) of this Section, except that: A. immediately under the name of the Bond, the headings "Interest Rate" and "Maturity Date" shall both be completed with the words "As shown below" and "CUSIP No. " shall be deleted. B. the first paragraph shall be deleted and the following will be inserted: "ANNA COMMUNITY DEVELOPMENT CORPORATION (the "Issuer"), being a nonstock, nonprofit industrial development corporation organized and existing under the laws of the State of Texas, including particularly the Development Corporation Act, formerly Article 5190.6, Texas Revised Civil Statutes, as amended, and now operating, existing and governed by the recodified provisions of such Act as a Type B corporation, under such Act, as such Act has been codified in Chapters 501 through 507, Texas Local Government Code, as amended (the "Act"), and acting on behalf of the City of Anna, Texas (the "City"), for value received, promises to pay, from the sources described herein, to the registered owner specified above, or registered assigns, the principal amount specified above, and to pay interest thereon, from the Delivery Date set forth above, on the balance of said principal amount from time to time remaining unpaid, at the rate per annum set forth above. The unpaid principal of this Bond shall mature and be payable in installments on the dates and in the principal installment amounts, and shall bear interest, calculated on the basis of basis of a 360-day year of twelve 30-day months, at the per annum rates, all as set forth in the following schedule: Payment Principal Interest Date Amount Rate (Information from Pricing Certificate to be inserted) 14 The Issuer promises to pay interest on the unpaid principal amount hereof (calculated on the basis of a 360-day year of twelve 30-day months) from at the respective Interest Rate per annum specified above. Interest is payable on , and semiannually on each and thereafter to the date of payment of the principal installment specified above, or the date of redemption prior to maturity; except, that if this Bond is required to be authenticated and the date of its authentication is later than the first Record Date (hereinafter defined), such Principal Amount shall bear interest from the interest payment date next preceding the date of authentication, unless such date of authentication is after any Record Date but on or before the next following interest payment date, in which case such principal amount shall bear interest from such next following interest payment date; provided, however, that if on the date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being exchanged is due but has not been paid, then this Bond shall bear interest from the date to which such interest has been paid in full." C. The Initial Bond shall be numbered "T-1." Section 6. PLEDGE. (a) The Bonds and any interest payable thereon, and any Additional Obligations which may be issued in accordance herewith and be Outstanding from time to time, and any interest payable thereon, are and shall be secured by and payable from a first lien on and pledge of the Pledged Revenues. The Bond is and will be secured by and payable only from the Pledged Revenues, and not from amounts on deposit in any other Funds or accounts of the Issuer, and are not secured by or payable from a mortgage or deed of trust on any real, personal or mixed properties of the Issuer. Neither the State of Texas, the City, nor any political corporation, subdivision, or agency of the State of Texas, nor any member of the Board of Directors of the Issuer, either individually or collectively, shall be obligated to pay the principal of or the interest on the Bond and neither the faith and credit nor the taxing power (except as described below) of the State of Texas, the City, or any other political corporation, subdivision, or agency thereof is pledged to the payment of the principal of or the interest on the Bonds. The Registered Owner of the Bonds shall not have the right to demand payment of the principal of or interest on this Bond from any tax proceeds other than the Sales Tax proceeds levied for the benefit of the Issuer by the City pursuant to Section 4B of the Act, or from any other source. (b) Article 1208, Government Code, applies to the issuance of the Bond and the pledge of the Pledged Revenues granted by the Issuer under this Section, and is therefore valid, effective, and perfected. Should Texas law be amended at any time while the Bond is outstanding and unpaid, the result of such amendment being that the pledge of the taxes granted by the Issuer under this Section is to be subject to the filing requirements of Chapter 9, Business & Commerce Code, in order to preserve to the Registered Owner of the Bond a security interest in said pledge, the Issuer agrees to take such measures as it determines are reasonable and necessary under Texas law to comply with the applicable provisions of Chapter 9, Business & Commerce Code and enable a filing of a security interest in said pledge to occur. Section 7. REVENUE FUND. There has been created and established on the books of the Issuer, and accounted for separate and apart from all other funds of the Issuer, a special trust fund entitled the "Anna Community Development Corporation Sales Tax Revenue Fund" (hereinafter called the "Revenue Fund"), which revenue fund is hereby affirmed. All Pledged Revenues shall be credited to the Revenue Fund immediately upon receipt. All Pledged Revenues deposited into the Revenue Fund shall promptly be transferred to the following funds in the following order of priority: FIRST: To the payment of the amounts required to be deposited in the Debt Service Fund for the payment of Debt Service on the Parity Obligations as the same becomes due and payable; 15 SECOND: To the payment of the amounts required to be deposited in the Reserve Fund pursuant to this Resolution or any resolution relating to the issuance of Parity Obligations; THIRD: To the payment of amounts required to be deposited in any other fund or account required by any resolution authorizing the issuance of Parity Obligations; and FOURTH: To any fund or account held at any place or places, or to any payee, required by any other resolution of the Board which authorized the issuance of obligations or the creation of debt of the Issuer having a lien on the Pledged Revenues subordinate to the lien created herein on behalf of the Parity Obligations. Any Pledged Revenues remaining in the Revenue Fund after satisfying the foregoing payments, or making adequate and sufficient provision for the payment thereof, may be appropriated and used for any other lawful purpose now or hereafter permitted by law. Section 8. DEBT SERVICE FUND. (a) For the sole purpose of paying the principal of and interest on the Parity Obligations Outstanding at any time, as the same come due (including principal coming due as a result of any mandatory redemption of the Parity Obligations), there has been created and established on the books of the Issuer a separate trust fund entitled the "Anna Community Development Corporation Sales Tax Revenue Bonds Debt Service Fund" (hereinafter called the "Debt Service Fund"), which Debt Service Fund is hereby affirmed. The Issuer covenants that there shall be deposited into the Debt Service Fund prior to each principal and interest payment date from the Pledged Revenues an amount equal to one hundred per cent (100%) of the interest on and the principal of the Bond then falling due and payable, and such deposits to pay principal and accrued interest on the Bond shall be made in substantially equal monthly installments on or before the 25th day of each month, beginning on or before the 25th day of the month next following the delivery of the Bond to the initial purchasers thereof, provided, however, that in any Fiscal Year the Issuer may elect to fund the Debt Service Fund on an accelerated basis and at any time when amounts on deposit in the Debt Service Fund are sufficient to make payment of all principal and interest coming due on the Outstanding Parity Obligations within the next twelve months, such deposits of Pledged Revenues to the Debt Service Fund may be discontinued, until there is once again an amount less than the principal and interest coming due on the Outstanding Parity Obligations within the next twelve months, at which time such deposits shall be resumed. (b) The required deposits to the Debt Service Fund for the payment of principal of and interest on the Bond shall continue to be made as hereinabove provided until (i) the total amount on deposit in the Debt Service Fund is equal to the amount required to fully pay and discharge the Bond (principal and interest) then Outstanding or (ii) the Bond is no longer Outstanding. Section 9. RESERVE FUND. (a) There has been created and ordered held at a depository of the Issuer, for the benefit of all Parity Obligations, the "Anna Community Development Corporation Sales Tax Revenue Bonds Reserve Fund" (hereinafter called the "Reserve Fund"), which Reserve Fund is hereby affirmed. To the extent that the amount on deposit in the Reserve Fund is at any time of calculation less than the Required Reserve, the Issuer shall deposit to the Reserve Fund the Required Reserve as provided in this Section or in a resolution authorizing the issuance of Parity Obligations. The Required Reserve amount for the Bonds may be funded by the deposit to the Reserve Fund of cash or a Credit Facility. If so funded with a Credit Facility or cash (whether at the time of delivery of Additional Obligations or by accumulation over time), a cash amount (or investments of cash) or the face value of a Credit Facility shall at least equal the Required Reserve. All funds, investments and Credit Facilities on deposit and credited to the Reserve Fund shall be used solely for (i) the 16 payment of the principal of and interest on Parity Obligations, when and to the extent other funds available for such purposes are insufficient, (ii) to make Credit Facility Payments and (iii) to the extent not required to maintain the Required Reserve, to pay, or provide for the payment of, the final principal amount of a series of Parity Obligations so that such series of Parity Obligations is no longer deemed to be "Outstanding" as such term is defined herein with reference to the Bond, or (iv) as provided in clause (d) below, any excess amount in the Reserve Fund may be transferred to the Revenue Fund and allocated in accordance with Section 7 hereof. Subject to subsection (e) of this Section, the Issuer may at any time substitute a qualifying Credit Facility for all or part of the cash or other Credit Facility on deposit in, or held for the benefit of, the Reserve Fund. (b) The Required Reserve may be calculated at the time of either of the following events: (1) the end of the Issuer's current Fiscal Year, or (ii) the date of delivery of any series of Additional Obligations; provided that the Required Reserve amount may be calculated on the occurrence of such events as if such event occurred as of the end of the Issuer's then -current Fiscal Year. (c) When and for so long as the cash and investments in the Reserve Fund and/or coverage afforded by a Credit Facility held for the account of the Reserve Fund equal the Required Reserve, no deposits need be made to the credit of the Reserve Fund; but, if and when the Reserve Fund at any time contains less than the Required Reserve, the Issuer covenants and agrees that the Issuer shall cure the deficiency in the Reserve Fund by making deposits to the Reserve Fund from the Pledged Revenues in accordance with Section 7 by monthly deposits in amounts equal to not less than 1/36th of the Required Reserve with any such deficiency payments being made on or before the last day of each month until the Required Reserve has been fully restored. Reimbursements to the provider of any Credit Facility deposited to the Reserve Fund shall constitute the making up of a deficiency to the extent that such reimbursements result in the reinstatement, in whole or in part, as the case may be, of the face value of the Credit Facility. The Issuer further covenants and agrees that, subject only to the prior deposits to be made to the Debt Service Fund, the Pledged Revenues shall be applied and appropriated and used to establish and maintain the Required Reserve, and any reserve fund that may be established for the benefit of any issue or series of Additional Obligations and to cure any deficiency in such amounts as required by the terms of this Resolution and any other resolution pertaining to the issuance of Additional Obligations. (d) Earnings and income derived from the investment of amounts held for the credit of the Reserve Fund shall be retained in the Reserve Fund until the Reserve Fund contains the Required Reserve. During such time as the Reserve Fund contains the Required Reserve, the Issuer may, at its option, withdraw all surplus funds in the Reserve Fund and deposit such surplus in the Revenue Fund. (e) Notwithstanding any other provision of this Resolution, if a Credit Facility is utilized in connection with the Bond after the issuance date of the Bond, the Board must specifically approve any such Credit Facility and any such Credit Facility must be submitted to the Attorney General (if submission is then required by law) for approval. (f) In the event that the Issuer deposits in the Reserve Fund a Credit Facility and there is a draw upon the Credit Facility, the Issuer shall reimburse the issuer of such Credit Facility for such draw, in accordance with the terms of any agreement pursuant to which the Credit Facility is used, from Pledged Revenues, however, such reimbursement from Pledged Revenues shall be subject to the provisions of subsection (c) of this Section and to the provisions of clause SECOND of Section 7. Section 10. TRANSFER. (a) Pursuant to the provisions of the Transfer Agreement, the City has agreed to do any and all things necessary to accomplish the transfer of the Sales Tax, at the higher rate of three-quarters of one percent, 17 collected for the benefit of the Issuer to the Revenue Fund on a monthly basis. The Transfer Agreement shall govern matters with respect to the collection of sales and use taxes from the Comptroller, credits and refunds due and owing to the Comptroller, and other matters with respect to the collection and transfer of the Sales Tax. (b) The President and the Treasurer of the Board and the Chief Administrative Officer of the Issuer are hereby ordered to do any and all things necessary to accomplish the transfer of money to the Funds established hereby in ample time to pay the principal of and interest on the Bonds. Section 11. INVESTMENTS. Money in any Fund established by this Resolution may, at the option of the Board, be invested in eligible investment securities as described in the Investment Act; provided that all such investments shall be made in such manner that the money required to be expended from any Fund will be available at the proper time or times. Investment earnings realized on investments attributable to the Debt Service Fund shall be retained therein and shall constitute a credit against the amount of money that is required to be on deposit therein for each payment of principal or interest. Such investments shall be valued in terms of current market value as of the last day of each Fiscal Year. Such investments shall be sold promptly when necessary to prevent any default in connection with the Bond. Section 12. FUNDS SECURED. Money in all Funds created by this Resolution, to the extent not invested, shall be secured in the manner prescribed by law for securing funds of the City. Section 13. PAYMENT. On or before the first payment date for the Bond, as set forth in the Pricing Certificate, and semiannually on or before each August 15 and February 15 thereafter while any portion of the Bond is Outstanding and unpaid, the Issuer shall cause to be transferred to the Paying Agent/Registrar amounts sufficient to make payment of the principal of and interest on the Bond to the Holder thereof with funds on deposit in the Debt Service Fund. Section 14. ADDITIONAL OBLIGATIONS. In addition to the right to issue obligations of inferior lien, the Issuer reserves the right to issue Additional Obligations which, when duly authorized and issued in compliance with law and the terms and conditions hereinafter appearing, shall be on a parity with the Bond herein authorized, payable from and equally and ratably secured by a lien on and pledge of the Pledged Revenues. The Additional Obligations may be issued in one or more installments, provided, however, that none shall be issued unless and until the following conditions have been met: (a) The President of the Board or the Chief Administrative Officer of the Issuer shall have executed a certificate stating (A) that, to the best of such person's knowledge and belief, the Issuer is not then in default as to any covenant or requirement contained in any resolution authorizing the issuance of outstanding Parity Obligations, and (B) either (1) payments into all special funds or accounts created and established for the payment and security of all outstanding Parity Obligations have been made and that the amounts on deposit in such special funds or accounts are the amounts then required to be on deposit therein or (2) the application of the proceeds of sale of such obligations then being issued will cure any such deficiency; (b) The Chief Administrative Officer signs and delivers to the Board a written certificate reflecting that for (i) the Fiscal Year next preceding the adoption of the resolution authorizing the proposed Additional Obligations or (ii) a consecutive twelve (12) month period out ofthe fifteen (15) month period next preceding the month in which the resolution authorizing the proposed Additional Obligations is adopted, the Pledged Revenues and interest earnings thereon were equal at least to 1.25 times the Maximum Annual Debt Service requirements on all Parity Obligations to be outstanding after the issuance of the proposed Additional Obligations; provided, however, that in the event an increase in the rate of the Sales Tax becomes effective prior to the date of a resolution authorizing 18 the issuance of Additional Obligations, such certificate or report shall calculate the Pledged Revenues for the calculation period as if such increased rate were in effect during the calculation period; and (c) The resolution authorizing the Additional Obligations provides that the Debt Service Fund be augmented by amounts adequate to accumulate the sum required to pay the principal and interest on such obligations as the same shall become due. SECTION 15. REFUNDING BONDS. The Issuer reserves the right to issue refunding Bonds to refund all or any part of the Parity Obligations (pursuant to any law then available) upon such terms and conditions as the Board may deem to be in the best interest of the Issuer, and if less than all such Parity Obligations then Outstanding are refunded, the conditions precedent prescribed (for the issuance of Additional Obligations) set forth in Section 14 hereof shall be satisfied, and shall give effect to the refunding. SECTION 16. SUBORDINATE DEBT. Except as may be limited by a future resolution authorizing the issuance of Parity Obligations, the Issuer shall have the right to issue or create any debt payable from or secured by a lien on all or any part of the Pledged Revenues for any lawful purpose without complying with the provisions of Section 14 or 15 hereof, provided the pledge and the lien securing such debt is subordinate to the pledge and lien established, made and created in Section 6 of this Resolution with respect to the Pledged Revenues to the payment and security of the Parity Obligations. SECTION 17. DEFEASANCE OF BOND. (a) Any Bond and the interest thereon shall be deemed to be paid, retired and no longer outstanding (a "Defeased Bond") within the meaning of this Resolution, except to the extent provided in subsection (d) of this Section, when payment of the principal of such Bond, plus interest thereon to the due date (whether such due date be by reason of maturity or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof, or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying Agent/Registrar in accordance with an escrow agreement or other instrument (the "Future Escrow Agreement") for such payment (1) lawful money of the United States of America sufficient to make such payment or (2) Defeasance Securities that mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money to provide for such payment, and when proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its services until the Defeased Bond shall have become due and payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the ad valorem taxes herein levied and pledged as provided in this Resolution, and such principal and interest shall be payable solely from such money or Defeasance Securities. (b) Any moneys so deposited with the Paying Agent/Registrar may at the written direction of the Issuer be invested in Defeasance Securities, maturing in the amounts and times as hereinbefore set forth, and all income from such Defeasance Securities received by the Paying Agent/Registrar that is not required for the payment of the Bond and interest thereon, with respect to which such money has been so deposited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer. Any Future Escrow Agreement pursuant to which the money and/or Defeasance Securities are held for the payment of a Defeased Bond may contain provisions permitting the investment or reinvestment of such moneys in Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the requirements specified in subsection (a)(i) or (ii) of this Section. All income from such Defeasance Securities received by the Paying Agent/Registrar which is not required for the payment of the Defeased Bond, with respect to which such money has been so deposited, shall be remitted to the Issuer or deposited as directed in writing by the Issuer. 19 (c) The term "Defeasance Securities" means any securities and obligations now or hereafter authorized by State law that are eligible to refund, retire or otherwise discharge obligations such as the Bond. (d) Until the Defeased Bond shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bond the same as if they had not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required by this Resolution. Section 18. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BOND. (a) Replacement Bond. In the event any outstanding Bond is damaged, mutilated, lost, stolen or destroyed, the Paying Agent/Registrar shall cause to be printed, executed and delivered, a new Bond of the same principal amount, maturity and interest rate, as the damaged, mutilated, lost, stolen or destroyed Bond, in replacement for such Bond in the manner hereinafter provided. (b) Application for Replacement Bond. Application for replacement of a damaged, mutilated, lost, stolen or destroyed Bond shall be made by the Registered Owner thereof to the Paying Agent/Registrar. In every case of loss, theft or destruction of a Bond, the Registered Owner applying for a replacement Bond shall furnish to the Issuer and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of loss, theft or destruction of a Bond, the Registered Owner shall furnish to the Issuer and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft or destruction of such Bond, as the case may be. In every case of damage or mutilation of a Bond, the Registered Owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or mutilated. (c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have matured, and no default has occurred that is then continuing in the payment of the principal of or interest on the Bond, the Issuer may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished as above provided in this Section. (d) Charge for Issuing Replacement Bond. Prior to the issuance of any replacement Bond, the Paying Agent/Registrar shall charge the Registered Owner of such Bond with all legal, printing, and other expenses in connection therewith. Every replacement Bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is lost, stolen or destroyed shall constitute a contractual obligation of the Issuer whether or not the lost, stolen or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Resolution. (e) Authority for Issuing_ Replacement Bond. In accordance with Sec. 1206.022, Government Code, this Section of this Resolution shall constitute authority for the issuance of any such replacement Bond without necessity of further action by the governing body of the Issuer or any other body or person, and the duty of the replacement of such Bond is hereby authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such Bond in the form and manner and with the effect, as provided in Section 4(a) of this Resolution for a Bond issued in exchange for another Bond. Section 19. CUSTODY, APPROVAL, AND REGISTRATION OF BOND; BOND COUNSEL'S OPINION; CUSIP NUMBERS AND CONTINGENT INSURANCE PROVISION, IF OBTAINED; ENGAGEMENT OF BOND COUNSEL. (a) The President of the Board is hereby authorized to have control of the Bond initially issued and delivered hereunder and all necessary records and proceedings pertaining to the Bond pending its delivery FA and their investigation, examination, and approval by the Attorney General of the State of Texas, and their registration by the Comptroller of Public Accounts of the State of Texas. Upon registration of the Bond said Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate attached to such Bond, and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Bond. The approving legal opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers (if obtained) may, at the option of the Issuer, be printed on the Bond issued and delivered under this Resolution, but neither shall have any legal effect, and shall be solely for the convenience and information of the Registered Owner of the Bond. In addition, if bond insurance is obtained, the Bond may bear an appropriate legend as provided by the insurer. (b) The obligation of the initial purchaser to accept delivery of the Bond is subject to the initial purchaser being furnished with the final, approving opinion of McCall, Parkhurst & Horton L.L.P., bond counsel to the Issuer, which opinion shall be dated as of and delivered on the date of initial delivery of the Bond to the initial purchaser. The engagement of such firm as bond counsel to the Issuer in connection with issuance, sale and delivery of the Bond is hereby approved and confirmed. The execution and delivery of an engagement letter between the Issuer and such firm, with respect to such services as bond counsel, is hereby authorized in such form as may be approved by the President of the Board, and the President of the Board is hereby authorized to execute such engagement letter. Section 20. [RESERVED]. Section 21. SALE OF BOND. (a) The Bonds shall be sold and delivered subject to the provisions of Section 2 and Section 3 and pursuant to the terms and provisions of a bond purchase agreement or purchase letter (the "Purchase Agreement") which the Pricing Officer is hereby authorized to execute and deliver and in which the purchaser or purchasers (the "Purchaser") of the Bonds shall be designated. The Initial Bond shall be registered in the name set forth in the Pricing Certificate. (b) The Pricing Officer is hereby authorized, in the name and on behalf of the Issuer, to approve, distribute, and deliver a preliminary official statement and a final official statement relating to the Bonds to be used by the Purchaser in the marketing of the Bonds. (c) The Pricing Officer is authorized, in connection with effecting the sale of the Bonds, to obtain from a municipal bond insurance company so designated in the Pricing Certificate (the "Insurer") a municipal bond insurance policy (the "Insurance Policy") in support of the Bonds. To that end, should the Pricing Officer exercise such authority and commit the Issuer to obtain a municipal bond insurance policy, for so long as the Insurance Policy is in effect, the requirements of the Insurer relating to the issuance of the Insurance Policy as set forth in the Pricing Certificate are incorporated by reference into this Resolution and made a part hereof for all purposes, notwithstanding any other provision of this Resolution to the contrary. The Pricing Officer shall have the authority to execute any documents to effect the issuance of the Insurance Policy by the Insurer. Section 22. FURTHER PROCEDURES. The President, Vice President of the Board and Secretary of the Board, and each of them, shall be and they are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things and to execute, acknowledge and deliver in the name of and on behalf of the Issuer a Paying Agent/Registrar Agreement with the Paying Agent/Registrar and all other instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Resolution, the Bond, the sale of the Bond and the private placement letter. In case any officer whose signature shall appear on any Bond shall cease to be such officer before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all purposes the same as if such officer had remained in office until such delivery. 21 Section 23. NO RULE 15c2-12 UNDERTAKING. The Issuer has not made an undertaking in accordance with Rule 15c2-12 of the Securities and Exchange Commission (the "Rule"). The Issuer is not, therefore, obligated pursuant to the Rule to provide any on -going disclosure relating to the Issuer or the Bond. Section 24. METHOD OF AMENDMENT. The Issuer hereby reserves the right to amend this Resolution subject to the following terms and conditions, to -wit: (a) The Issuer may from time to time, without the consent of any Registered Owner, except as otherwise required by paragraph (b) below, amend or supplement this Resolution in order to (i) cure any ambiguity, defect or omission in this Resolution that does not materially adversely affect the interests of the holders, (ii) grant additional rights or security for the benefit of the holders, (iii) add events of default as shall not be inconsistent with the provisions of this Resolution and that shall not materially adversely affect the interests of the holders, (iv) qualify this Resolution under the Trust Indenture Act of 1939, as amended, or corresponding provisions of federal laws from time to time in effect, or (v) make such other provisions in regard to matters or questions arising under this Resolution as shall not be inconsistent with the provisions of this Resolution and that shall not in the opinion of the Issuer's Bond Counsel materially adversely affect the interests of the holders. (b) Except as provided in paragraph (a) above, the Registered Owners of a majority in principal amount of Outstanding Parity Obligations shall have the right from time to time to approve any amendment hereto that may be deemed necessary or desirable by the Issuer; provided, however, that without the consent of the Registered Owners of all Outstanding Parity Obligations, nothing herein contained shall permit or be construed to permit amendment of the terms and conditions of this Resolution or in the Bonds so as to: (1) Make any change in the maturity of the Bonds; (2) Reduce the rate of interest borne by the Bonds; (3) Reduce the amount of the principal of payable on the Bonds; (4) Modify the terms of payment of principal or of interest on the Bonds or impose any condition with respect to such payment; or (5) Change the requirement with respect to Registered Owner consent to such amendment. (c) If at any time the Issuer shall desire to amend this Resolution under this Section, the Issuer shall send by U.S. mail to the Registered Owner of the Outstanding Parity Obligations a copy of the proposed amendment. (d) Whenever at any time within one year from the date of mailing of such notice the Issuer shall receive an instrument or instruments executed by the Registered Owners of majority in principal amount of all Parity Obligations Outstanding, which instrument or instruments shall refer to the proposed amendment and that shall specifically consent to and approve such amendment, the Issuer may adopt the amendment in substantially the same form. (e) Upon the adoption of any amendatory Resolution pursuant to the provisions of this Section, this Resolution shall be deemed to be modified and amended in accordance with such amendatory Resolution, and the respective rights, duties, and obligations of the Issuer and the Registered Owner of the Bonds shall thereafter be determined, exercised, and enforced, subject in all respects to such amendment. 22 (f) Any consent given by the Registered Owner of a Bond pursuant to the provisions of this Section shall be irrevocable for a period of six months from the date of the ailing of the notice provided for in this Section, and shall be conclusive and binding upon all future holders of the same Bond during such period. Such consent may be revoked at any time after six months from the date of the mailing of said notice by the Registered Owner, or by a successor in title, by filing notice with the Issuer. For the purposes of establishing ownership of the Bonds, the Issuer shall rely solely upon the registration of the ownership of such Bonds on the registration books kept by the Paying Agent/Registrar. Section 25. CONSTRUCTION FUND. The Issuer hereby creates and establishes and shall maintain on the books of the Issuer a separate fund to be entitled the "Series 2016 Bonds Construction Fund" for use by the Issuer for payment of all lawful costs associated with the acquisition and construction of the Projects as hereinbefore provided. Upon payment of all such costs, any moneys remaining on deposit in said Fund shall be transferred to the Debt Service Fund. Section 26. APPROVAL OF SALES TAX REMITTANCE AGREEMENT. The Sales Tax Remittance Agreement is hereby affirmed. The Issuer hereby confirms the City's depository bank as the Issuer's depository bank for the Sales Tax Fund established pursuant to the Sales Tax Remittance Agreement. Section 27. SEVERABILITY. If any section, article, paragraph, sentence, clause, phrase or word in this Resolution, or application thereof to any persons or circumstances is held invalid or unconstitutional by a court of competent jurisdiction, such holding shall not affect the validity of the remaining portion of this Resolution, despite such invalidity, which remaining portions shall remain in full force and effect. Section 28. EFFECTIVE DATE. This Resolution shall be effective immediately upon its adoption by the Board. (Execution Page Follows) 23 PASSED, APPROVED AND EFFECTIVE this President, Board of Directors ATTEST: Secretary, Board of Directors I Item No. 6. City Council Agenda Staff Report Meeting Date: 11 /22/2016 YOUR) HOMETOWN AGENDAITEM: Consider/Discuss/Action on an Ordinance authorizing the issuance and sale of City of Anna, Texas General Obligation Refunding Bond, Series 2016, levying an annual ad valorem tax for the payment of said Bond, and enacting other provisions relating to the subject. (City Manager) SUMMARY: Pursuant to a Plan of Finance presented by FirstSouthwest, the City's financial advisor, on October 25, 2016; the City Council will consider an Ordinance authorizing the issuance of approximately $870,000 General Obligation Refunding Bond, Series 2016 (the "2016 Bond") in order to refinance $640,000 (which represents a portion of the currently outstanding Combination Tax and Revenue Certificate of Obligation, Series 2007); and $165,000 (which represents a portion of the currently outstanding General Obligation Refunding Bond, Series 2007) (the "Refunded Obligations"). Moreover, a portion of the proceeds of the 2016 Bond will be utilized to pay financing costs. The Refunded Obligations currently carry a tax-exempt interest rate of 3.95%. The Refunded Obligations interest rate is scheduled to reset to 15% on February 15, 2017. February 15, 2017 is also the "call date" for the Refunded Obligations. On such "call date" the Refunded Obligations can be paid off without penalty, it is the City's plan to set up an escrow account with proceeds of 2016 Bond to have sufficient funds to pay off the Refunded Obligations on February 15, 2017 and avoid the interest rate reset. Pursuant to the Plan of Finance, it is expected the fixed tax-exempt interest rate on the 2016 Bond will be lower than the current 3.95% on the Refunded Obligations. The 2016 Bond will be amortized through February 15, 2027 which represents the existing final maturity of the Refunded Obligations, there will be no extension of original maturity. The 2016 Bond early prepayment feature (call date) will be at the option of the 2016 Bond purchaser (investor). The $1,420,000 Combination Tax and Revenue Certificate of Obligation, Series 2007 was originally issued in March 2007 to finance street projects, drainage projects, signalization, landscaping, right-of-way and land acquisition and utility system improvements. The $370,000 General Obligation Refunding Bond, Series 2007 was originally issued in March 2007 to refinance the Limited Tax Note, Series 2006 which was a short term debt instrument issued to finance 19 acres of land at 1300 West FM 455 to be used in part for Natural Springs park. Both 2007 Refunded Obligations were sold to Bank ofAmerica for a repayment term of 20 years, but a 10-year tax-exempt interest rate pricing subject to reset in 2017. STAFF RECOMMENDATION: Staff recommends approval of the attached Ordinance. ATTACHMENTS: Description Upload Date Type JrdfnanceAuhorizing GO Refuding Bonds 11/17/2016 Ordinance ORDINANCE NO. -2016 AUTHORIZING THE ISSUANCE AND SALE OF CITY OF ANNA, TEXAS GENERAL OBLIGATION REFUNDING BOND, SERIES 2016, LEVYING AN ANNUAL AD VALOREM TAX FOR THE PAYMENT OF SAID BOND, AND ENACTING OTHER PROVISIONS RELATING TO THE SUBJECT STATE OF TEXAS § COUNTY OF COLLIN § CITY OF ANNA § WHEREAS, there are presently outstanding the following obligations (the "Refunded Obligations") of the City of Anna, Texas (the "Issuer"), which are secured by a pledge by the Issuer to levy ad valorem taxes sufficient to pay principal of and interest on such obligations as they become due, within the limit prescribed by law, and certain of which are additionally secured by a pledge of limited surplus revenues of the Issuer's waterworks and sewer system: Combination Tax and Revenue Certificate of Obligation, Series 2007 Maturi , Date February 15, 2017 February 15, 2018 February 15, 2019 February 15, 2020 February 15, 2021 February 15, 2022 February 15, 2023 February 15, 2024 February 15, 2025 February 15, 2026 February 15, 2027 Principal Amount Outstanding $ 60,000 $ 30,000 $ 35,000 $ 40,000 $ 45,000 $ 55,000 $ 60,000 $ 75,000 $ 85,000 $100,000 $115,000 Principal Amount Refunded $ 0 $ 30,000 $ 35,000 $ 40,000 $ 45,000 $ 55,000 $ 60,000 $ 75,000 $ 85,000 $100,000 $115,000 General Obligation Refunding Bond, Series 2007 Maturity Date February 15, 2017 February 15, 2018 February 15, 2019 February 15, 2020 February 15, 2021 February 15, 2022 February 15, 2023 Principal Amount Outstanding $15,000 $10,000 $10,000 $10,000 $10,000 $15,000 $15,000 Principal Amount Refunded $ 0 $10,000 $10,000 $10,000 $10,000 $15,000 $15,000 February 15, 2024 $20,000 $20,000 February 15, 2025 $20,000 $20,000 February 15, 2026 $25,000 $25,000 February 15, 2027 $30,000 $30,000 WHEREAS, the Issuer now desires to refund all of the Refunded Obligations; WHEREAS, Chapter 1207, Texas Government Code, authorizes the Issuer to issue refunding bonds and to deposit the proceeds from the sale thereof, together with any other available funds or resources, directly with a paying agent for the Refunded Obligations or a trust company or commercial bank that does not act as a depository for the Issuer and is named in these proceedings, and such deposit, if made before the payment dates of the Refunded Obligations, shall constitute the making of firm banking and financial arrangements for the discharge and final payment of the Refunded Obligations; WHEREAS, Chapter 1207, Texas Government Code, further authorizes the Issuer to enter into an escrow or similar agreement with such paying agent for the Refunded Obligations or trust company or commercial bank with respect to the safekeeping, investment, reinvestment, administration and disposition of any such deposit, upon such terms and conditions as the Issuer and such paying agent or trust company or commercial bank may agree; WHEREAS, the Escrow Agent (as hereinafter defined) is a commercial bank that does not act as a depository for the Issuer; WHEREAS, the City Council of the Issuer hereby finds and declares a public purpose and deems it in the best interests of the Issuer to refund the Refunded Obligations in order to achieve a debt service savings and to restructure the Issuer's outstanding debt service, and that such refunding will result in a present value debt service savings of approximately $ and an actual debt service savings of $ to the Issuer; and WHEREAS, all the Refunded Obligations mature or are subject to redemption prior to maturity within 20 years of the date of the bond hereinafter authorized; WHEREAS, the bond hereafter authorized is being issued and delivered pursuant to the Constitution and laws of the State of Texas, including Chapter 1207. THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS: Section 1. AMOUNT AND PURPOSE OF THE BOND. The City Council of the Issuer hereby incorporates the recitals set forth in the preamble hereto as if set forth in full at this place and further finds and determines that said recitals are true and correct. The bond of the City of Anna, Texas (the "Issuer") is hereby authorized to be issued and delivered in the aggregate principal amount of $ FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND THE 2 REFUNDED OBLIGATIONS AND TO PAY THE COSTS OF ISSUANCE RELATED THERETO. Section 2. DESIGNATION, DATE, DENOMINATION, PAYMENT DATES AND INTEREST RATE OF BOND. The Bond issued pursuant to this Ordinance shall be designated: CITY OF ANNA, TEXAS GENERAL OBLIGATION REFUNDING BOND, SERIES 2016," and there shall be issued, sold, and delivered hereunder one fully registered Bond, without interest coupons, dated December 1, 2016, in the principal amount stated above, numbered R-1, with any Bond issued in replacement thereof being in the denomination and principal amount of $ or the remaining principal amount of the outstanding Bonds of this series if an exchange of a Bond is made after a reduction in the principal amount of the series (the "Authorized Denomination"), and numbered consecutively from R-2 upward, payable to the registered owner thereof, or to the registered assignee of said Bond (in each case, the "Holder"). Principal on the Bond shall be payable in installments in the amounts and on the dates specified in the FORM OF BOND set forth in this Ordinance. The Bond shall bear interest from the date of delivery to the date of payment or prepayment prior to maturity, calculated on the basis of a 360-day year of twelve 30-day months. Said interest shall be payable at such rates and in the manner provided and on the dates stated in the FORM OF BOND set forth in this Ordinance. Section 3. CHARACTERISTICS OF THE BOND. (a) Registration, Transfer and Exchange; Authentication. The Issuer shall keep or cause to be kept at the a corporate trust office of [NAME OF PAYING AGENT/REGISTRAR], [CITY], [STATE] (the "Paying Agent/Registrar"), books or records for the registration of the transfer of the Bond (the "Registration Books"), and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such registrations of transfers under such reasonable regulations as the Issuer and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations and transfers as herein provided within three days of presentation in due and proper form. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the Holder of the Bond to which payments with respect to the Bond shall be mailed, as herein provided; but it shall be the duty of the Holder to notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for making such registration and transfer of a substitute Bond. Registration of assignments and transfers of the Bond shall be made in the manner provided and with the effect stated in the FORM OF BOND set forth in this Ordinance. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. Except as provided in Section 3(c) hereof, an authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign said Bond, and 3 no such Bond shall be deemed to be issued or outstanding unless such Bond is so executed. The Paying Agent/Registrar promptly shall cancel a Bond surrendered for transfer or the Bond when paid in full. No additional ordinances, orders or resolutions need be passed or adopted by the governing body of the Issuer or any other body or person so as to accomplish the foregoing transfer of any Bond or portion thereof, and the Paying Agent/Registrar shall provide for the printing, execution and delivery of the substitute Bond in the manner prescribed herein. Pursuant to Subchapter D, Chapter 1201, Texas Government Code, the duty of transfer of the Bond as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of said Bond, said Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Bond which initially was issued and delivered pursuant to this Ordinance, approved by the Attorney General of the State of Texas (the "Attorney General"), and registered by the Comptroller of Public Accounts of the State of Texas (the "Comptroller"). (b) Payment of Bond and Interest. The Issuer hereby further appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bond, all as provided in this Ordinance. The Paying Agent/Registrar shall keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the Bond and shall properly and accurately record all payments on the Bond on the Registration Books, and shall keep proper records of all transfers of the Bond, and all replacements of the Bond, as provided in this Ordinance. However, in the event of a nonpayment of interest on a scheduled payment date, and for thirty (30) days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date by United States mail, first- class postage prepaid, to the address of the Holder appearing on the Registration Books at the close of business on the last business day next preceding the date of mailing of such notice. (c) In General. The Bond (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bond to be payable only to the Holder thereof, (ii) may be redeemed prior to maturity, (iii) may be transferred and assigned, (iv) shall have the characteristics, (v) shall be signed, sealed, executed and authenticated, (vi) the principal of and interest on the Bond shall be payable, and (vii) shall be administered and the Paying Agent/Registrar and the Issuer shall have certain duties and responsibilities with respect to the Bond, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF BOND set forth in this Ordinance. The Bond initially issued and delivered pursuant to this Ordinance is not required to be, and shall not be, authenticated by the Paying Agent/Registrar, but on each substitute Bond issued in exchange for any Bond the Paying Agent/Registrar shall execute the PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE, in the form set forth in the FORM OF BOND. (d) Substitute Paying Agent/Registrar. . The Issuer covenants with the Holder of the Bond that at all times while the Bond is outstanding the Issuer will provide a competent and legally qualified bank, trust company, financial institution or other agency to act as and perform the services 2 of Paying Agent/Registrar for the Bond under this Ordinance, and that the Paying Agent/Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 40 days written notice to the Paying Agent/Registrar, to be effective not later than 30 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Bond, to the new Paying Agent/Registrar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar, the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to the Holder of the Bond, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance, and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar. (e) On the closing date, the initial Bond No. R-1 representing the entire principal amount of the Bond, payable to the Purchaser, executed by manual or facsimile signature of the Mayor or Mayor Pro-Tem and City Secretary of the Issuer, approved by the Attorney General, and registered and manually signed by the Comptroller, will be delivered to the Purchaser or its designee. Section 4. FORM OF BOND. The form of the Bond, including the form of Paying Agent/Registrar's Authentication Certificate, the form of Assignment and the form of the Comptroller's Registration Certificate to be attached to the Bond initially issued and delivered pursuant to this Ordinance, shall be, respectively, substantially as provided in Exhibit A hereto, with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance. Section 5. TAX LEVY. (a) A special "Interest and Sinking Fund" is hereby created and shall be established and maintained by the Issuer at an official depository bank of said Issuer. Said Interest and Sinking Fund shall be kept separate and apart from all other funds and accounts of said Issuer, and shall be used only for paying the interest on and principal of said Bond. All ad valorem taxes levied and collected for and on account of said Bond shall be deposited, as collected, to the credit of said Interest and Sinking Fund. During each year while any of said Bond is outstanding and unpaid, the governing body of said Issuer shall compute and ascertain a rate and amount of ad valorem tax that will be sufficient to raise and produce the money required to pay the interest on said Bond as such interest comes due, and to provide and maintain a sinking fund adequate to pay the principal of said Bond as such principal matures (but never less than 2% of the original amount of said Bond as a sinking fund each year); and said tax shall be based on the latest approved tax rolls of said Issuer, with full allowances being made for tax delinquencies and the cost of tax collection. Said rate and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable 5 property in said Issuer, for each year while any of said Bond is outstanding and unpaid, and said tax shall be assessed and collected each such year and deposited to the credit of the aforesaid Interest and Sinking Fund. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of said Bond, as such interest comes due and such principal matures, are hereby pledged for such payment, within the limit prescribed by law. (b) Notwithstanding the requirements of subsection (a) of this Section, if Surplus Revenues or other lawfully available moneys of the Issuer are actually on deposit or budgeted and appropriated to be deposited in the Interest and Sinking Fund in advance of the time when ad valorem taxes are scheduled to be levied for any year, then the amount of taxes that otherwise would have been required to be levied pursuant to this Section may be reduced to the extent and by the amount of the Surplus Revenues or other lawfully available funds then on deposit or budgeted and appropriated to be deposited in the Interest and Sinking Fund. For purposes of this Section, "Surplus Revenues" means revenues derived by the Issuer from the ownership and operation of the Issuer's waterworks and sewer system (the "System") that remain after the payment of all maintenance and operation expenses thereof, and all debt service, reserve and other requirements in connection with all of the Issuer's revenue obligations (now or hereafter outstanding) or contractual obligations (now or hereafter existing) which are payable from all or any part of the net revenues of the System. If Surplus Revenues are budgeted and appropriated for deposit into the Interest and Sinking Fund, the Issuer: (i) shall transfer and deposit in the Interest and Sinking Fund each month an amount of not less than 1/12th of the annual debt service on the Bond to be paid from Surplus Revenues until the amount on deposit in the Interest and Sinking Fund equals the amount required for annual debt service on the Bond; (ii) shall establish, adopt and maintain an annual budget that provides for either the monthly deposit of sufficient Surplus Revenues and/or tax revenues, the monthly deposit of any other legally available funds on hand at the time of the adoption of the annual budget, or a combination thereof, into the Interest and Sinking Fund for the repayment of the Bond; and (iii) shall at all times maintain and collect sufficient System rates and charges in conjunction with any other legally available funds that, after payment of the costs of operating and maintaining the System, produce revenues in an amount not less than the debt service requirements of all outstanding revenue bonds of the Issuer and other obligations of the Issuer which are secured in whole or in part by a pledge of revenues of the System and for which the Issuer is budgeting the repayment of such obligations from the revenues of the System, or the Issuer shall provide documentation which evidences the levy of an ad valorem tax rate dedicated to the Interest and Sinking Fund, in conjunction with any other legally available funds except System rates and charges, sufficient for the repayment of System debt service requirements. 2 (c) Chapter 1208, Texas Government Code, applies to the issuance of the Bond and the pledge of the taxes and revenues granted by the Issuer under this Section, and is therefore valid, effective, and perfected. Should Texas law be amended at any time while the Bond is outstanding and unpaid, the result of such amendment being that the pledge of the taxes and revenues granted by the Issuer under this Section, is to be subject to the filing requirements of Chapter 9, Texas Business & Commerce Code, in order to preserve to the registered owner of the Bond a security interest in said pledge, the Issuer agrees to take such measures as it determines are reasonable and necessary under Texas law to comply with the applicable provisions of Chapter 9, Texas Business & Commerce Code and enable a filing of a security interest in said pledge to occur. Section 6. METHOD OF AMENDMENT. The Issuer hereby reserves the right to amend this Ordinance subject to the following terms and conditions: (a) The Issuer may from time to time, without the consent of the Holder, except as otherwise required by paragraph (b) below, amend or supplement this Ordinance in order to (i) cure any ambiguity, defect or omission in this Ordinance that does not materially adversely affect the interests of the Holder, (ii) grant additional rights or security for the benefit of the Holder, (iii) add events of default as shall not be inconsistent with the provisions of this Ordinance and that shall not materially adversely affect the interests of the Holder, (iv) qualify this Ordinance under the Trust Indenture Act of 1939, as amended, or corresponding provisions of federal laws from time to time in effect, or (v) make such other provisions in regard to matters or questions arising under this Ordinance as shall not be inconsistent with the provisions of this Ordinance and that shall not in the opinion of nationally -recognized bond counsel materially adversely affect the interests of the Holder. (b) Except as provided in paragraph (a) above, the Holder of the Bond shall have the right from time to time to approve any amendment hereto that may be deemed necessary or desirable by the Issuer; provided, however, that without the consent of the Holder of the Bond, nothing herein contained shall permit or be construed to permit amendment of the terms and conditions of this Ordinance or in the Bond so as to: (1) Make any change in the final maturity or any other date fixed hereby for the payment of an installment of principal of the Bond; (2) Reduce the rate of interest borne by the Bond; (3) Reduce the amount of the principal of, or redemption premium, if any, payable on the Bond; (4) Modify the terms of payment of principal or of interest or redemption premium the Bond or impose any condition with respect to such payment; or (5) Change the requirement with respect to approval by the Holder of the Bond necessary for consent to such amendment. 7 (c) If at any time the Issuer shall desire to amend this Ordinance under this Section, the Issuer shall send by U.S. mail to the Holder of the Bond a copy of the proposed amendment. (d) Whenever at any time within one year from the date of the mailing of such notice the Issuer shall receive an instrument or instruments executed by the Holder of the Bond, which instrument or instruments shall refer to the proposed amendment and shall specifically consent to and approve such amendment, the Issuer may adopt the amendment in substantially the same form. (e) Upon the adoption of any amendatory Ordinance pursuant to the provisions of this Section, this Ordinance shall be deemed to be modified and amended in accordance with such amendatory Ordinance, and the rights, duties, and obligations of the Issuer and the Holder of the Bond shall thereafter be determined, exercised, and enforced, subject in all respects to such amendment. For the purposes of establishing ownership of the Bond, the Issuer shall rely solely upon the registration of the ownership of such bond on the Registration Books kept by the Paying Agent/Registrar. Section 7. DEFEASANCE OF BOND. (a) The Bond or a portion of the principal amount thereof and the interest thereon shall be deemed to be paid, retired and no longer outstanding (a "Defeased Bond") within the meaning of this Ordinance, except to the extent provided in subsection (d) of this Section, when payment of the principal of the Bond, plus interest thereon to the due date (whether such due date be by reason of payment, final maturity or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof, or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying Agent/Registrar in accordance with an escrow agreement or other instrument (the "Future Escrow Agreement") for such payment (1) lawful money of the United States of America sufficient to make such payment or (2) Defeasance Securities that mature as to principal and interest in such amounts and at such times as will insure the availability of sufficient money to provide for such payment, and when proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its services until the Defeased Bond shall have become due and payable. At such time as the Bond or a portion thereof shall be deemed to be a Defeased Bond hereunder, as aforesaid, such Bond or portion thereof and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the ad valorem taxes or revenues herein levied and pledged as provided in this Ordinance, and such principal and interest shall be payable solely from such money or Defeasance Securities, and thereafter the Issuer will have no further responsibility with respect to amounts available to the Paying Agent/Registrar (or other financial institution permitted by applicable law) for the payment of such Defeased Bond, including any insufficiency therein caused by the failure of the Paying Agent/Registrar (or other financial institution permitted by applicable law) to receive payment when due on the Defeasance Securities. (b) Any moneys so deposited with the Paying Agent/Registrar may at the written direction of the Issuer be invested in Defeasance Securities, maturing in the amounts and times as hereinbefore set forth, and all income from such Defeasance Securities received by the Paying Agent/Registrar that is not required for the payment of the Bond or portion thereof and interest thereon, with respect to which such money has been so deposited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer. Any Future Escrow Agreement pursuant to which the money and/or Defeasance Securities are held for the payment of the Defeased Bond may contain provisions permitting the investment or reinvestment of such moneys in Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the requirements specified in (i) or (ii) of paragraph (a) above. All income from such Defeasance Securities received by the Paying Agent/Registrar that is not required for the payment of the Defeased Bond, with respect to which such money has been so deposited, shall be remitted to the Issuer or deposited as directed in writing by the Issuer. (c) The term "Defeasance Securities" means any securities and obligations now or hereafter authorized by State law that are eligible to refund, retire or otherwise discharge obligations such as the Bond. (d) Until the Defeased Bond shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bond the same as if it had not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required by this Ordinance. Section 8. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BOND. (a) Replacement Bond. In the event the Bond is damaged, mutilated, lost, stolen, or destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered a new bond of the same principal amount, final maturity, and interest rate, as the damaged, mutilated, lost, stolen, or destroyed Bond in replacement for the Bond in the manner hereinafter provided. (b) Application for Replacement Bond. Application for replacement of a damaged, mutilated, lost, stolen, or destroyed Bond shall be made by the Holder thereof to the Paying Agent/Registrar. In every case of loss, theft, or destruction of the Bond, the Holder applying for a replacement bond shall furnish to the Issuer and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of loss, theft, or destruction of the Bond, the Holder shall furnish to the Issuer and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Bond. In every case of damage or mutilation of the Bond, the Holder shall surrender to the Paying Agent/Registrar for cancellation the Bond. (c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have finally matured, and no default has occurred that is then continuing in the payment of the principal of or interest on the Bond, the Issuer may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Bond) 0 instead of issuing a replacement Bond, provided security or indemnity is furnished as above provided in this Section. (d) Charge for Issuing Replacement Bond. Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge the Holder of the Bond with all legal, printing, and other expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section by virtue of the fact that the Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all other Bonds duly issued under this Ordinance. (e) Authority for Issuing Replacement Bond. In accordance with Chapter 1201, Subchapter D, Texas Government Code, this Section of this Ordinance shall constitute authority for the issuance of any such replacement bond without necessity of further action by the governing body of the Issuer or any other body or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such Bond in the form and manner and with the effect, as provided in Section 3(a) of this Ordinance for a Bond issued in exchange for another Bond. Section 9. CUSTODY, APPROVAL, AND REGISTRATION OF BOND; BOND COUNSEL'S OPINION AND ENGAGEMENT OF BOND COUNSEL; APPROVAL OF ATTORNEY GENERAL REVIEW FEE. (a) The Mayor is hereby authorized to have control of the Bond initially issued and delivered hereunder and all necessary records and proceedings pertaining to the Bond pending its delivery and its investigation, examination, and approval by the Attorney General and registration by the Comptroller. Upon registration of the Bond the Comptroller (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate attached to the Bond, and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Certificate. If bond insurance is obtained, the Bond may bear an appropriate legend as provided by the insurer. (b) The obligation of the Purchaser to accept delivery of the Bond is subject to the Purchaser being furnished with the final, approving opinion of McCall, Parkhurst & Horton L.L.P., "Bond Counsel" to the Issuer, which opinion shall be dated as of and delivered on the date of initial delivery of the Bond to the Purchaser. The engagement of such firm as Bond Counsel to the Issuer in connection with issuance, sale and delivery of the Bond is hereby approved and confirmed. The execution and delivery of an engagement letter between the Issuer and such firm, with respect to such services as Bond Counsel, is hereby authorized in such form as may be approved by the Mayor of the Issuer (or the Mayor Pro-tem in the absence of the Mayor), and the Mayor of the Issuer (or the Mayor Pro-tem in the absence of the Mayor) is hereby authorized to execute such engagement letter. Section 10. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON THE BOND. The Issuer covenants to take any action necessary to assure, or refrain from any action that would adversely affect, the treatment of the Bond as an obligation described in section 103 of the 10 Internal Revenue Code of 1986, as amended (the "Code"), the interest on which is not includable in the "gross income" of the holder for purposes of federal income taxation. In furtherance thereof, the Issuer covenants as follows: (a) to take any action to assure that no more than 10 percent of the proceeds of the Bond or the projects refinanced therewith (less amounts deposited to a reserve fund, if any) are used for any "private business use," as defined in section 141(b)(6) of the Code or, if more than 10 percent of the proceeds or the projects financed therewith are so used, such amounts, whether received by the Issuer, with respect to such private business use, do not, under the terms of this Ordinance or any underlying arrangement, directly or indirectly, secure or provide for the payment of more than 10 percent of the debt service on the Bond, in contravention of section 141(b)(2) of the Code; (b) to take any action to assure that in the event that the "private business use" described in subsection (a) hereof exceeds 5 percent of the proceeds of the Bond or the projects refinanced therewith (less amounts deposited into a reserve fund, if any) then the amount in excess of 5 percent is used for a "private business use" that is "related" and not "disproportionate," within the meaning of section 141(b)(3) of the Code, to the governmental use; (c) to take any action to assure that no amount that is greater than the lesser of $5,000,000 or 5 percent of the proceeds of the Bond (less amounts deposited into a reserve fund, if any) is directly or indirectly used to finance loans to persons, other than state or local governmental units, in contravention of section 141(c) of the Code; (d) to refrain from taking any action that would otherwise result in the Bond being treated as a "private activity bond" within the meaning of section 141(b) of the Code; (e) to refrain from taking any action that would result in the Bond being "federally guaranteed" within the meaning of section 149(b) of the Code; (f) to refrain from using any portion of the proceeds of the Bond, directly or indirectly, to acquire or to replace funds that were used, directly or indirectly, to acquire investment property (as defined in section 148(b)(2) of the Code) that produces a materially higher yield over the term of the Bond, other than investment property acquired with — (1) proceeds of the Bond invested for a reasonable temporary period or, in the case of current refunding bonds, for a period of 90 days or less and in the case of advance refunding bonds, for a period of 30 days or less, until such proceeds are needed for the purpose for which the bonds are issued, (2) amounts invested in a bona fide debt service fund, within the meaning of section 1.148-1(b) of the rules and regulations of the United States Department of the Treasury ("Treasury Regulations"), and 11 (3) amounts deposited in any reasonably required reserve or replacement fund to the extent such amounts do not exceed 10 percent of the proceeds of the Bond; (g) to otherwise restrict the use of the proceeds of the Bond or amounts treated as proceeds of the Bond, as may be necessary, so that the Bond does not otherwise contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the extent applicable, section 149(d) of the Code (relating to advance refundings); and (h) to pay to the United States of America at least once during each five-year period (beginning on the date of delivery of the Bond) an amount that is at least equal to 90 percent of the 'Excess Earnings," within the meaning of section 148(f) of the Code and to pay to the United States of America, not later than 60 days after the Bond has been paid in full, 100 percent of the amount then required to be paid as a result of Excess Earnings under section 148(f) of the Code. In order to facilitate compliance with the above covenant (h), a "Rebate Fund" is hereby established by the Issuer for the sole benefit of the United States of America, and such fund shall not be subject to the claim of any other person, including without limitation the Holder. The Rebate Fund is established for the additional purpose of compliance with section 148 of the Code. For purposes of the foregoing (a) and (b), the Issuer understands that the term "proceeds" includes "disposition proceeds" as defined in the Treasury Regulations and, in the case of refunding bonds, transferred proceeds (if any) and proceeds of the refunded bonds expended prior to the date of issuance of the Bond. It is the understanding of the Issuer that the covenants contained herein are intended to assure compliance with the Code and any Treasury Regulations or rulings promulgated pursuant thereto. In the event that regulations or rulings are hereafter promulgated that modify or expand provisions of the Code, as applicable to the Bond, the Issuer will not be required to comply with any covenant contained herein to the extent that such failure to comply, in the opinion of nationally recognized bond counsel, will not adversely affect the exemption from federal income taxation of interest on the Bond under section 103 of the Code. In the event that regulations or rulings are hereafter promulgated that impose additional requirements that are applicable to the Bond, the Issuer agrees to comply with the additional requirements to the extent necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption from federal income taxation of interest on the Bond under section 103 of the Code. In furtherance of such intention, the Issuer hereby authorizes and directs the Mayor, City Manager, Finance Director and/or City Secretary of the Issuer to execute any documents, certificates or reports required by the Code and to make such elections, on behalf of the Issuer, that may be permitted by the Code, as are consistent with the purpose for the issuance of the Bond. Section 11. SALE OF BOND. The Bond is hereby sold and shall be delivered to [NAME OF PURCHASER] (the "Purchaser") for cash for the par value thereof, pursuant to the Purchase Letter dated the date of the adoption of this Ordinance. The Bond shall initially be registered in the name of the Purchaser. In satisfaction of Section 1201.022(a)(3)(B), Texas Government Code, and 12 upon consultation with the Issuer's Financial Advisor, it is hereby officially found, determined, and declared that the terms of the Bond as set forth herein are in the Issuer's best interests. Section 12. REDEMPTION OF REFUNDED OBLIGATIONS; ESCROW AGREEMENT. (a) The Issuer hereby directs that the Refunded Obligations be called for redemption on February 15, 2017. The redemption price shall be the par amount of the Refunded Obligations so redeemed plus interest accrued and unpaid to the date fixed for redemption. The paying agent for the Refunded Obligations is hereby directed to make appropriate arrangements so that the Refunded Obligations may be redeemed on such redemption date, including giving the appropriate notices of redemption as are required by the ordinances authorizing the Refunded Obligations. (b) The Mayor (or in the Mayor's absence, the Mayor Pro-Tem) of the Issuer is further authorized to enter into and execute on behalf of the Issuer with Regions Bank (the "Escrow Agent"), an escrow agreement in the form and substance as presented at this meeting, which escrow agreement agreement will provide for the payment in full of the Refunded Obligations (the "Escrow Agreement"). Section 13. FURTHER PROCEDURES. The Mayor of the Issuer (or the Mayor Pro-tem in the absence of the Mayor) and City Secretary of the Issuer and all other officers, employees and agents of the Issuer, and each of them, shall be and are hereby expressly authorized, empowered and directed from time to time and at any time to do and perform all such acts and things and to execute, acknowledge and deliver in the name and under the corporate seal, if required, and on behalf of the Issuer the Paying Agent/Registrar Agreement with the Paying Agent/Registrar, the Escrow Agreement with the Escrow Agent, the Purchase Letter, a Private Placement Agent Agreement with Frost Bank, and all other instruments, whether herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Ordinance, the Bond and the sale of the Bond. In case any officer whose signature shall appear on any Bond shall cease to be such officer before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all purposes the same as if such officer had remained in office until such delivery. Section 14. DISPOSITION OF PROJECT; ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR THE PROJECT. (a) The Issuer covenants that the property constituting the Project, being the property financed or refinanced with the proceeds of the Refunded Obligations (the "Project"), will not be sold or otherwise disposed in a transaction resulting in the receipt by the Issuer of cash or other compensation, unless any action taken in connection with such disposition will not adversely affect the tax-exempt status of the Bond. For purpose of the foregoing, the Issuer may rely on an opinion of nationally -recognized bond counsel that the action taken in connection with such sale or other disposition will not adversely affect the tax-exempt status of the Bond. For purposes of the foregoing, the portion of the property comprising personal property and disposed in the ordinary course shall not be treated as a transaction resulting in the receipt of cash or other compensation. For purposes hereof, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion of nationally -recognized bond counsel that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest on the Bond. 13 (b) The Issuer covenants to account for the expenditure of sale proceeds and investment earnings to be used for the Project on its books and records in accordance with the requirements of the Code. The Issuer recognizes that in order for the proceeds to be considered used for the reimbursement of costs, the proceeds must be allocated to expenditures within 18 months of the later of the date that (1) the expenditure is made, or (2) the Project is completed; but in no event later than three years after the date on which the original expenditure is paid. The foregoing notwithstanding, the Issuer recognizes that in order for proceeds to be expended under the Code, the sale proceeds or investment earnings must be expended no more than 60 days after the earlier of (1) the fifth anniversary of the delivery of the Bonds, or (2) the date the Bonds are retired. The Issuer agrees to obtain the advise of nationally -recognized bond counsel if such expenditure fails to comply with the foregoing to assure that such expenditure will not adversely affect the tax-exempt status of the Bonds. For purposes hereof, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion of nationally -recognized bond counsel that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest on the Bond. Section 15. NO RULE 15c2-12 UNDERTAKING. The Issuer has not made an undertaking in accordance with Rule 15c2-12 of the Securities and Exchange Commission (the "Rule"). The Issuer is not, therefore, obligated pursuant to the Rule to provide any on -going disclosure relating to the Issuer or the Bond. Section 16. GOVERNING LAW. This Ordinance shall be construed and enforced in accordance with the laws of the State of Texas (the "State") and the United States of America. Section 17. SEVERABILITY. If any provision of this Ordinance or the application thereof to any circumstance shall be held to be invalid, the remainder of this Ordinance and the application thereof to other circumstances shall nevertheless be valid, and the City Council hereby declares that this Ordinance would have been enacted without such invalid provision. Section 18. DESIGNATION AS QUALIFIED TAX-EXEMPT OBLIGATION. The Issuer hereby designates the Bond as a "qualified tax-exempt obligation" as defined in section 265(b)(3) of the Code, conditioned upon the Purchaser identified in Section 11 hereof certifying that the aggregate initial offering price of the Bond is no greater than $10 million (or such other amount permitted by such section 265 of the Code). Assuming such condition is met, in furtherance of such designation, the Issuer represents, covenants and warrants the following: (a) that during the calendar year in which the Bond is issued, the Issuer (including any subordinate entities) has not designated nor will designate obligations, which when aggregated with the Bond, will result in more than $10,000,000 (or such other amount permitted by such section 265 of the Code) of "qualified tax- exempt obligations" being issued; (b) that the Issuer reasonably anticipates that the amount of tax- exempt obligations issued, during the calendar year in which the Bond is issued, by the Issuer (or any subordinate entities) will not exceed $10,000,000 (or such other amount permitted by such section 265 of the Code); and, (c) that the Issuer will take such action or refrain from such action as necessary, and as more particularly set forth in this Section, in order that the Bond will not be considered a "private activity bond" within the meaning of section 141 of the Code. 14 Section 19. APPROPRIATION. To pay the debt service coming due on the Bond prior to receipt of the taxes levied to pay such debt service, if any, there is hereby appropriated from current funds on hand, which are hereby certified to be on hand and available for such purpose, an amount, which together with capitalized interest received from the sale of the Bond, if any, will be sufficient to pay such debt service, and such amount shall be used for no other purpose. 15 Exhibit A FORM OF BOND NO. R-1 UNITED STATES OF AMERICA PRINCIPAL STATE OF TEXAS AMOUNT CITY OF ANNA, TEXAS $ GENERAL OBLIGATION REFUNDING BOND, SERIES 2016 DATE OF DELIVERY: DECEMBER 22, 2016 REGISTERED OWNER: PRINCIPAL AMOUNT: The City of Anna, in Collin County, Texas (the "Issuer"), being a political subdivision of the State of Texas, for value received, promises to pay, from the sources described herein, to the registered owner specified above, or registered assigns (in each case, the "Holder"), the principal amount specified above, and to pay interest thereon, from the date of delivery set forth above, on the balance of said principal amount from time to time remaining unpaid. This Bond shall finally mature on February 15, 2027, but shall be payable in installments on the dates and in the principal installment amounts, and shall bear interest at a rates per annum, calculated on the basis of basis of a 360-day year of twelve 30-day months, as set forth in the following schedule: Principal Interest Payment Date Installment Rate August 15, 2017 February 15, 2018 February 15, 2019 February 15, 2020 February 15, 2021 February 15, 2022 February 15, 2023 February 15, 2024 February 15, 2025 February 15, 2026 February 15, 2027 The principal of and interest on this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The Issuer shall pay interest on this Bond on August 15, 2017 and on each August 15 and February 15 thereafter to the date of the final maturity hereof or the date of redemption prior to maturity. The last principal installment of this Bond shall be paid to the Holder hereof upon presentation and surrender of this Bond at final maturity, or upon A-1 the date fixed for its redemption prior to maturity, at the corporate trust office of [NAME OF PAYING AGENT/REGISTRAR], [CITY], [STATE], which is the " Paying Agent/Registrar" for this Bond. The payment of all other principal installments of and interest on this Bond shall be made by the Paying Agent/Registrar to the Holder hereof on each principal and interest payment date by check or draft, dated as of such principal and interest payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer required by the Bond Ordinance (as defined below) to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such interest payment date, to the Holder hereof, at its address as it appeared at the close of business on the last business day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. In addition, principal and interest may be paid by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the Holder. Any accrued interest due in connection with the payment of the final installment of principal of this Bond shall be paid to the Holder upon presentation and surrender of this Bond for payment or redemption at the designated corporate trust office of the Paying Agent/Registrar. The Issuer covenants with the Holder of this Bond that on or before each principal payment date, interest payment date, and accrued interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bond, when due. If the date for the payment of this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the city where the designated corporate trust office of the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due. This Bond is authorized and issued pursuant to and in compliance with Chapter 1207, Texas Government Code, as amended, and pursuant to the ordinance adopted by the Issuer authorizing the issuance hereof (the "Bond Ordinance"), in the original aggregate principal amount of $ , dated as of December 1, 2016 FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND THE REFUNDED OBLIGATIONS (AS DEFINED IN THE BOND ORDINANCE) AND TO PAY THE COSTS OF ISSUANCE RELATED THERETO. On , 20_, or any date thereafter, the unpaid principal installments of this Bond are subject to redemption, and may be redeemed prior to the scheduled due dates by the Issuer, in an amount of not less than $5,000, at a redemption price equal to the principal amount thereof to be redeemed plus accrued interest thereon to the date of redemption, without premium. The Issuer shall give written notice of its direction to redeem the principal installments of this Bond to the Paying Agent/Registrar and the Registered Owner of this Certificate by United States mail, first-class postage prepaid, no later than 20 days prior to the date fixed for redemption. A-2 This Bond is issuable solely as a single fully -registered Bond, without interest coupons in the denomination of $ or the remaining principal amount of the outstanding Bonds of this series if an exchange of a Bond is made after a reduction in the principal amount of the series (the "Authorized Denomination"). As provided in the Bond Ordinance, this Bond may, at the request of the Holder or the assignee or assignees hereof, be assigned and transferred in whole but not in part for a like aggregate principal amount Bond, without interest coupons, payable to the appropriate Holder, assignee or assignees, as the case may be, in the Authorized Denomination, upon surrender of this Bond to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in the Bond Ordinance. Among other requirements for such assignment and transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar, together with the proper instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond to the assignee this Bond is to be registered. The form of Assignment printed or endorsed on this Bond may be executed by the Holder to evidence the assignment hereof, but such method is not exclusive, and other instruments of assignment satisfactory to the Paying Agent/Registrar may be used to evidence the assignment of this Bond from time to time by the Holder. In the case of the assignment and transfer of this Bond, the reasonable standard or customary fees and charges of the Paying Agent/Registrar will be paid by the Issuer. In any circumstance, any taxes or governmental charges required to be paid with respect thereto shall be paid by the one requesting such assignment and transfer, as a condition precedent to the exercise of such privilege. The Issuer and the Paying Agent/Registrar may deem and treat the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or redemption price hereof and interest due hereon and for all other purposes. The Paying Agent/Registrar shall not be required to make any such transfer during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date. In the event any Paying Agent/Registrar for this Bond is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, and cause written notice thereof to be mailed to the Holder of the Bond. IT IS HEREBY certified, recited and covenanted that this Bond has been duly and validly authorized, issued and delivered; that all acts, conditions and things required or proper to be performed, exist and be done precedent to or in the authorization, issuance and delivery of this Bond have been performed, existed and been done in accordance with law; and that annual ad valorem taxes sufficient to provide for the payment of the interest on and principal of this Bond, as such interest comes due and such principal matures, have been levied and ordered to be levied against all taxable property in said Issuer, and have been pledged for such payment, within the limit prescribed by law, all as provided in the Bond Ordinance. The Issuer has reserved the right to amend the Bond Ordinance as provided therein, and under some (but not all) circumstances amendments thereto must be approved by the Holder of this Bond. A-3 By becoming the Holder of this Bond, the Holder thereby acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and the Bond Ordinance constitute a contract between each Holder hereof and the Issuer. MI IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile signature of the Mayor of the Issuer (or the Mayor Pro-tem in the absence of the Mayor), countersigned with the manual or facsimile signature of the City Secretary of the Issuer, and has caused the official seal of the Issuer to be duly impressed or placed in facsimile on, this Bond. (signature) (signature) Natha Wilkison, City Secretary Mike Crist, Mayor (SEAL) [Form of Paying Agent/Registrar's Authentication Certificate] PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE (To be executed if this Bond is not accompanied by an executed Comptroller's Registration Certificate) It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance described in the text of this Bond; and that this Bond has been issued in exchange for a bond of a series which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas. Dated: [NAME OF PAYING AGENT/REGISTRAR] [CITY], [STATE] Paying Agent/Registrar By Authorized Representative A-5 [Form of Assignment] ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto Please insert Social Security or Taxpayer Identification Number of Transferee (Please print or typewrite name and address, including zip code of Transferee) the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints , attorney, to register the transfer of the within Bond on the books kept for registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: Signature(s) must be guaranteed by an eligible guarantor institution participating in a securities transfer association recognized signature guarantee program. o NOTICE: The signature above must correspond with the name of the Registered Owner as it appears upon the front of this Bond in every particular, without alteration or enlargement or any change whatsoever. [Form of Comptroller's Registration Certificate] COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. I hereby certify that this Bond has been examined, certified as to validity, and approved by the Attorney General of the State of Texas, and that this Bond has been registered this day by me. Witness my signature and seal this (COMPTROLLER'S SEAL) Comptroller of Public Accounts of the State of Texas A-7 I Item No. 7. City Council Agenda Staff Report Meeting Date: 11 /22/2016 YOUR) HOMETOWN AGENDAITEM: Consider/Discuss/Action regarding a Resolution authorizing the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. for the purchase and installation of Advanced Metering Infrastructure. (Joseph Johnson) SUMMARY: The City Council recently approved the Fiscal Year 2017 budget which included funding assigned for the purchase and installation of Advanced Metering Infrastructure. Advanced Metering Infrastructure (AMI) is essentially the infrastructure necessary to allow two-way communication between a water meter and the City's utility billing system using RF and internet communication. The principal goal of AMI is to provide on -demand water consumption data. Additional benefits of AMI include increased efficiency and more productive use of department personnel, regular billing intervals, removal of human error, and detailed consumption data that will allow the customer to make informed decisions about water use. We estimate that Water department employees spend an average of 164 man hours per month reading water meters and on other associated tasks. The total annual cost ($36,471 labor plus $7,872 in fuel) is estimated at $44,384. This cost will increase as the number of utility customers increases. An entry level maintenance worker costs approximately $46,000 per year and works an average of 155 hours per month in the field. The AMI system would cost an estimated $1.3 million and would be financed over a ten-year period. The annual payments on the AMI system ($149,178) are approximately $59,000 more than the annual cost ($90,000) of our water meter replacement program. For just under the net annual cost of the AMI, the City could add additional staff to the Water department, but that would delay the full implementation of the more accurate and more efficient fully automated system. In addition, the cost of manual and drive -by meter reading will increase as Anna continues to grow. The AMI project will change all the water meters during FY 2016-17 and will allow our Water department and Utility Billing staff to realize the labor saving benefits of the system within the first year. Over the past several months City staff has met with various vendors that provide AMI. Our goal was to identify the system that was most versatile, allowed for technologic advances without full system replacement, employed local and skilled customer service representatives, was cost effective, and offered a durable and trustworthy product. The Neptune fixed -base AMI system distributed locally by HD Supply Waterworks, met or exceeded that criteria. Staff is recommending purchase and installation of the Neptune fixed -base AMI system and will provide a more detailed briefing on the system during the regular Council meeting. The AMI system will also allow for a customer web portal to be activated in the FY 2017-18 budget. The customer web portal has the option to provide customers with real time consumption data and customer driven consumption updates and alerts. This system will provide water customers more information and greater control over their water usage. STAFF RECOMMENDATION: Staff recommends approval of the Resolution which authorizes the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. for the purchase and installation of advanced metering infrastructure. ATTACHMENTS: Description Upload Date Type Resolution approving AMI Project Agreement 11 /16/2016 Resolution Exhibit 1, Master Project Agreement 11 /16/2016 Exhibit CITY OF ANNA, TEXAS RESOLUTION NO. A RESOLUTION OF THE CITY OF ANNA, TEXAS APPROVING AND AUTHORIZING THE CITY MANAGER TO ACT ON THE CITY'S BEHALF IN EXECUTING A MASTER PROJECT AGREEMENT WITH HD SUPPLY WATERWORKS, LTD., FOR ADVANCED METERING INFRASTRUCTURE. WHEREAS; The City of Anna has reviewed proposals from various vendors offering advanced metering infrastructure and found the fixed network advanced metering infrastructure system manufactured by Neptune Technology Group Inc. and distributed by HD Supply Waterworks, Ltd. to be the best value; and, WHEREAS; HD Supply Waterworks, Ltd. is the sole source distributor for Neptune Technology Group Inc. in the State of Texas; and, WHEREAS; the City Council of the City of Anna, Texas (the "City Council") previously approved the Fiscal Year 2017 budget which included funding for advanced metering infrastructure; and, WHEREAS; Staff recommends approving a Master Project Agreement (the Agreement) with HD Supply, Ltd. for the purchase and installation of advanced metering infrastructure (the "Project") attached hereto as Exhibit 1; and, WHEREAS; the Agreement includes all equipment and installation costs necessary to complete the Project with compensation to HD Supply, Ltd. for said costs in the amount of $1,340,009.75; and, WHEREAS; the City Manager has negotiated financing for the Project with US Bancorp; and, WHEREAS; the City Council desires to authorize the City Manager to execute an Agreement with HD Supply Waterworks, Ltd. for construction of the Project; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS, THAT: Section 1. Recitals Incorporated. The recitals above are incorporated herein as if set forth in full for all purposes. Section 2. Authorization. The City Council hereby approves the Master Project Agreement attached hereto as Exhibit 1, and authorizes, ratifies and approves the City Manager's execution of same. The City Manager is hereby authorized to execute all documents and to take all other actions necessary to finalize, act under, and enforce the Agreement with HD Supply Waterworks, Ltd. RESOLUTION: Advanced Metering Infrastructure Agreement PAGE 1 OF 2 11 /22/16 PASSED AND APPROVED by the City Council of the City of Anna, Texas, on this 22nd day of November 2016. ATTEST: APPROVED: City Secretary Carrie L. Smith Mayor Mike Crist RESOLUTION: Advanced Metering Infrastructure Agreement PAGE 2 OF 2 11/22/16 • PPLY WATERWORKS City of Anna Master Project Agreement HD Supply Waterworks, Ltd. 6959 State Highway 276 Royse City, TX 75189 Table of Contents Section Purposeand Scope............................................................................................................................. 1 Definitions and Terminology............................................................................................................. 2 Term................................................................................................................................................... 3 HD Supply Waterworks' Responsibilities......................................................................................... 4 Client's Responsibilities..................................................................................................................... 5 Defaultof Client................................................................................................................................. 6 Defaultof HD Supply Waterworks.................................................................................................... 7 Insolvency.......................................................................................................................................... 8 Taxes, Permits, and Fees.................................................................................................................... 9 Warranty............................................................................................................................................. 10 Indemnity........................................................................................................................................... 1 1 Safety................................................................................................................................................. 12 Liabilityand Force Majeure............................................................................................................... 13 Insurance............................................................................................................................................ 14 HazardousMaterials........................................................................................................................... 15 Cleanup.............................................................................................................................................. 16 Delaysand Access.............................................................................................................................. 17 Qualityof Materials.......................................................................................................................... 18 Financing........................................................................................................................................... 19 LegalGovernance.............................................................................................................................. 20 DisputeResolution............................................................................................................................. 21 Attorney's Fees................................................................................................................................. 22 Assignability..................................................................................................................................... 23 Notices.............................................................................................................................................. 24 BindingEffect................................................................................................................................... 25 Modifications.................................................................................................................................... 26 Severability....................................................................................................................................... 27 Appendix A Procurement, Installation and Management Contract Exhibit A-1 Material Procurement Summary for Installation Contract Exhibit A-2 Acceptance Certificate Appendix B Reserved Appendix C Reserved Appendix D Warranty Exhibit D-1 Manufacturers' Warranties 1 • SUPPLY. WATERWORKS Master Project Agreement This Master Project Agreement (as hereinafter defined, this "Agreement") dated as of November , 2016 between HD Supply Waterworks, Ltd. a limited partnership consisting of HD Supply Waterworks Group, Inc. (limited Partner) and HD Supply GP & Management, Inc. (General Partner) (as hereinafter defined, "HD Supply Waterworks"), and the City of Anna (as hereinafter defined, "Client"). 1. Purpose and Scope. The Agreement is a Master Project Agreement to provide certain Work to Client. HD Supply Waterworks agrees to undertake the necessary Work as specified in this Agreement, and Client agrees to take all actions that are identified in this Agreement and to pay HD Supply Waterworks in the manner contemplated by this Agreement. This Agreement consists of the text set forth herein and the text set forth in each Appendix to this Agreement that is executed and delivered by the Parties. The Appendices checked below are the only Appendices that have been executed and delivered by the Parties as part of this Agreement (provided, however, that Exhibits that are part of a stated Appendix also shall be part of this Agreement): [X ] Appendix A --Procurement, Installation and Management Contract [ ] Appendix B--Reserved [ ] Appendix C--Reserved [ X ] Appendix D--Warranty 2. Definitions and Terminology. When used in this Agreement or in any of its attachments, the following capitalized terms shall have the respective meanings as follows: "Agreement" shall mean this Master Project Agreement, to include all Appendices and Exhibits. "AWWA" shall mean the American Water Works Association "AMR" shall mean Automatic Meter Reading "AMI" shall mean Advanced Metering Infrastructure "Client" shall mean the City of Anna together with its successors. "Factory Installation Recommendation" shall mean guidelines for installation procedures given by the manufacturer of the equipment. "Financing Contract" shall mean any separate financing agreement that may be executed and delivered by the Parties as contemplated by Appendix C to this Agreement, but only to the extent that Section 1 of this Agreement shall indicate that Appendix C applies to this Agreement. No Financing Contract delivered pursuant to this Agreement shall constitute a part of this Agreement, and this Agreement does not constitute a part of any Financing Contract executed and delivered by the Parties. "Force Majeure" shall mean conditions beyond the reasonable control, or not the result of willful misconduct or negligence of the Party, including, without limitation acts of God, storms, extraordinary weather, acts of government units, strikes or labor disputes, fire, explosions, thefts, vandalism, riots, acts of war or terrorism, non -price related unavailability of Project Materials and Supplies, and unavailability of fuel. "Hazardous Materials" are any materials, substances, chemicals, and wastes recognized as hazardous or toxic (or other interchangeable terms of equal meaning) under applicable laws, regulations, rules, ordinances, and any governmental or authoritative body having jurisdiction over the execution of this Agreement and its attachments. "HD Supply Waterworks" shall mean HD Supply Waterworks, Ltd., a limited partnership, together with its successors. "Installation Contract" shall mean the Procurement, Installation, and Management Contract attached to this Agreement as Appendix A, but only to the extent that the Parties have executed and delivered such Appendix A. "Manufacturer Defect" shall mean any fault or defect in materials or workmanship that manifests itself during the Warranty Period and is covered by the manufacturer's warranty. "Manufacturer's Warranty Period" shall have the meaning set forth in Appendix D to this Agreement. "Party" shall mean either HD Supply Waterworks or Client. "Project" shall mean the work to be performed by HD Supply Waterworks or its subcontractors as described in this Agreement. "Project Materials and Supplies" shall mean the materials and equipment specified in Appendix A. "RF" shall be interchangeable with the term Radio Frequency. "State" shall mean the State of Texas in which Client is located. "Third Party" shall mean a person or entity other than Client or HD Supply Waterworks. "Utility Service Area" shall mean the geographic area where the Project will be installed and the Work (and, if applicable, the Services) will be performed. This geographic area shall be specifically defined as the service area of the City of Anna and any other geographic areas including Client's system that HD Supply Waterworks, in its discretion, shall approve in writing for inclusion in the Utility Service Area. Said approval shall not be unreasonably withheld or delayed. "Warranty Period" shall have the meaning set forth in Appendix D to this Agreement. "Work" shall mean all work required for the completion of HD Supply Waterworks' obligations under this Agreement, including, to the extent that the Parties execute and deliver the Installation Contract attached hereto as Appendix A, the installation Work contemplated by the Installation Contract. 3. Term. The Term of this Agreement shall begin on the commencement date as listed in the opening paragraph and, unless earlier terminated in the manner contemplated by this Agreement, shall continue for a period of one year. Thereafter, this Agreement will automatically renew for additional periods of one year each under the same terms and conditions, until terminated by either party as specified herein. Notwithstanding the foregoing, either Party may terminate this Agreement and the Services and Work described herein by giving the other Party sixty (60) days prior written notice of its termination of this Agreement. No such termination shall have the effect of terminating any Financing Contract between the Parties if there are any amounts outstanding in respect of such Financing Contract. 4. HD Supply Waterworks' Responsibility. HD Supply Waterworks shall provide Services, supply Project Materials and Supplies, and do all other Work as described in this Agreement. Without limiting the generality of the foregoing, HD Supply Waterworks shall maintain supervision of all its subcontractors. Any Work beyond the scope of the Work agreed to herein shall not be considered as part of this Agreement. There shall be no implied or verbal agreements between the Parties relating to the subject matter of this Agreement. 5. Client's Responsibility. Client shall be responsible for cooperating with HD Supply Waterworks, providing accurate information in a timely manner, and making payment in a timely manner for Work performed, Project Materials and Supplies furnished, or Services rendered. Client shall designate a representative who will be fully acquainted with the Work and will be reasonably accessible to HD Supply Waterworks and its subcontractors, and will have the authority to make decisions on behalf of Client. Client shall provide to HD Supply Waterworks and its subcontractors all information regarding legal limitations, utility locations and other information reasonably pertinent to this Agreement and the Project. Client shall be required to give prompt notice should it become aware of any fault or defect in the Project. 6. Default of Client. The following events shall be considered events of Default of Client: (a) The failure of Client to make payments to HD Supply Waterworks in accordance with the terms of this Agreement; (b) any written representation or warranty provided by Client that proves to be materially false or misleading when made; or (c) any material failure of Client to comply with or perform according to the terms of this Agreement or to correct such failure to perform within any cure period specified in this Agreement. If an event of Default by Client occurs, HD Supply Waterworks will exercise any and all remedies available to it under this Agreement. 7. Default of HD Supply Waterworks. The following events shall be considered events of default on the part of HD Supply Waterworks: (a) failure of HD Supply Waterworks to provide adequate personnel, equipment, and supplies in accordance with the provisions and specifications of this Agreement; (b) any failure to promptly re -perform, within a reasonable time, Work or Services that properly were rejected as defective or nonconforming; (c) the failure of HD Supply Waterworks to deliver its Work and Services free and clear of any lien or encumbrance by any subcontractor, laborer, materialman, or other creditor of HD Supply Waterworks; (d) any representation or warranty (other than a warranty as contemplated by Section 10 of this Agreement) provided by HD Supply Waterworks proves to be materially false or misleading when made; or (e) any material failure of HD Supply Waterworks to comply with or perform according to the terms of this Agreement or to correct such failure to perform within any cure period specified in this Agreement. In the event of default by HD Supply Waterworks, Client may exercise any and all remedies available to it under this Agreement. 8. Insolvency. In the event that either Party becomes insolvent or makes an assignment for the benefit of creditors or is adjudicated bankrupt or admits in writing that it is unable to pay its debts, or should any proceedings be instituted under any state or federal law for relief of debtors or for the appointment of a receiver, trustee, or liquidator of either Party, or should voluntary petition in bankruptcy or a reorganization or any adjudication of either Party as an insolvent or a bankrupt be filed, or should an attachment be levied upon either Parties equipment and not removed within five (5) days therefrom, then upon the occurrence of any such event, the other Party shall thereupon have the right to cancel this Agreement and to terminate immediately all work hereunder without further obligation. 9. Taxes, Permits, and Fees. HD Supply Waterworks shall be responsible for obtaining all permits and related permit fees associated with the Project; provided, however, that Client must disclose any known fees in advance of contract signing. Client shall be responsible for securing at its sole expense any other necessary approvals, easements, assessments, or required zoning changes. HD Supply Waterworks shall be responsible for all taxes measured by HD Supply Waterworks' income. 10. Warranty. The warranty provided by HD Supply Waterworks and the manufacturer on Project Materials and Supplies, Work, and Services shall be as set forth in Appendix D. 11. Indemnity. Subject to Sections 13 and 14 of this Agreement: (a) Except as otherwise expressly provided in Section I l(b) below, Client assumes all liability and risk associated with the use, operation, and storage of the Project Materials and Supplies and for property damage, injuries, or deaths associated with or arising out of the use and operation of the Project unless said damage, injury, or death is proximately caused by HD Supply Waterworks, its employees, subcontractors, or agents. If any such damage, injury, or death is proximately caused by any act or omission of HD Supply Waterworks, its employees, subcontractors or agents, then HD Supply Waterworks shall indemnify, defend, and save and hold harmless Client and its officials, officers, agents, and employees from and against any and all actual and direct liability, claims, demands, damages, losses, and expenses, including, but not limited to court costs and reasonable attorney fees and related expenses incurred by the Client. (b) HD Supply Waterworks shall indemnify, defend, and save and hold harmless Client and employees from and against all claims for payment of subcontractors or materialmen hired by HD Supply Waterworks for Work relating to the Project. HD Supply Waterworks and Client agree that HD Supply Waterworks is responsible only for damages that result from the intentional misconduct or the negligent act or omission of HD Supply Waterworks or its subcontractors. 12. Safety. HD Supply Waterworks shall have the primary responsibility for the supervision, initiation, and maintaining all safety precautions and programs necessary to complete its Work associated with the Project. HD Supply Waterworks agrees to comply with all applicable regulations, ordinances, and laws relating to safety. It shall be the responsibility of Client, however, to assure that HD Supply Waterworks is warned of any known hazards on sites owned by the Client where HD Supply Waterworks is authorized to do its Work. 13. Liability and Force Maieure. HD Supply Waterworks' liability under this Agreement shall not exceed the total dollar value of this Agreement or One Million Three Hundred Forty Thousand Nine and 75/100 Dollars ($1,340,009.75), whichever is less. Neither HD Supply Waterworks nor Client shall be responsible to each other for any indirect, consequential, incidental or special damages resulting in any form from the Project. Neither HD Supply al Waterworks nor Client shall be responsible to each other for injury, loss, damage, or delay that arise from Force Majeure. HD Supply Waterworks shall not be responsible for any equipment or supplies other than Project Equipment and Supplies, except that HD Supply Waterworks shall be responsible any actual and direct injury, loss, or damage related to such equipment or supplies that HD Supply Waterworks may cause by intentional conduct or negligence. 14. Insurance and Risk. During the Term of this Agreement, HD Supply Waterworks shall maintain the following insurance with an insurance company licensed to do business in the State of Texas by the State Insurance Commission or any successor agency that has a rating with Best Rate Carriers of at least an A- or above: (a) Comprehensive General Liability Insurance with bodily injury limits of not less than $500,000 for each occurrence and not less than $500,000 in the aggregate, and with property damage limits of not less than $100,000 for each occurrence and not less than $100,000 in the aggregate. (b) Automobile Liability Insurance with bodily injury limits of not less than $500,000 for each person and not less than $500,000 for each accident, and with property damage limits of not less than $100,000 for each accident. (c) Worker's Compensation Insurance in accordance with statutory requirements, and Employers' Liability Insurance with limits of not less than $100,000 for each accident. (d) HD Supply Waterworks shall furnish insurance certificates at Client's request to evidence such coverages. The insurance certificates shall name Client as an additional insured on all such policies, and shall contain a provision that such insurance shall not be canceled without 30 days' prior written notice to Client and HD Supply Waterworks. In such event, HD Supply Waterworks shall, prior to the effective date of the cancellation, serve substitute certificates furnishing the same coverage. 15. Hazardous Materials. The Project and the Work expressly excludes any Work or Services of any nature associated or connected with the identification, abatement, cleanup, control, removal, or disposal of Hazardous Materials or substances. Client warrants and represents that, to the best of Client's knowledge, there is no asbestos or other hazardous materials in the Project premises in areas that HD Supply Waterworks shall be required to perform work that in any way will affect HD Supply Waterworks' ability to complete the Project. If HD Supply Waterworks is made aware or suspects the presence of Hazardous Materials, HD Supply Waterworks reserves the right to stop work in the affected area and shall immediately notify Client. It shall remain Client's responsibility to correct the condition to comply with local and federal standards and regulations. Client shall remain responsible for any Claims that result from the presence of the Hazardous Materials. Client is responsible for proper disposal of all hazardous materials, including but not limited to lithium batteries. 16. Cleanup. HD Supply Waterworks will be responsible for keeping the Project area free from the accumulation of waste materials or trash that result from the Project -related Work. Upon completion of the initial Project - related Work, HD Supply Waterworks will remove all waste materials, trash, tools, construction equipment and supplies, and shall remove all surplus materials associated with the Project. 17. Delays and Access. If conditions arise that delay the commencement, completion, or servicing of the Project as a consequence of Force Majeure or failure of Client to perform its obligation that prevents HD Supply Waterworks or its agents from performing work, then HD Supply Waterworks will notify Client in writing of the existence of delay and the nature of the delay. Client and HD Supply Waterworks will then mutually agree upon any new completion dates, disbursement terms, and payment terms for the Work contemplated by this Agreement. Nothing in the foregoing sentence shall be deemed to relieve Client from its obligation to provide to the extent set forth in this Agreement HD Supply Waterworks and its subcontractors reasonable and safe access to facilities that are necessary for HD Supply Waterworks to complete the Work. 18. Quality of Materials. HD Supply Waterworks will use the Project Materials and Supplies specified in Appendix A. Where brand names and part numbers are specified HD Supply Waterworks will use the items listed in Appendix A unless specified items are unavailable or discontinued. In this instance HD Supply Waterworks will work with Client to choose a substitute. Where brand names are not specified, HD Supply Waterworks will choose Project Materials and Supplies that are within industry norms and standards. Should Client require Project Materials and Supplies with specific requirements, Client should make these specifications known in a timely manner. HD Supply Waterworks can use Client -furnished or Client -specific materials; however, Client will need to provide them or pay the difference in price and labor should any exist. Examples of Client specific requirements include but are not limited to country or state of origin, union manufactured, specific brand, or manufacturing process. 5 19. Financing. If the Parties so agree and have so indicated in Section 1 of this Agreement, HD Supply Waterworks shall provide financing for the Project pursuant to any separate Financing Contract executed and delivered by the Parties as contemplated by Appendix C. The Financing Contract is not part of this Agreement, and this Agreement is not part of the Financing Contract. 20. Legal Governance. The laws of the State shall govern this Agreement and the relationship of the Parties contemplated hereby. 21. Dispute Resolution. (a) The Parties will attempt in good faith to resolve through negotiation any dispute, claim or controversy arising out of or relating to this Agreement. Either Party may initiate negotiations by providing written notice to the other Party, setting forth the subject of the dispute and the relief requested. The recipient of such notice will respond in writing within three business days from receipt with a statement of its position on, and recommended solution to, the dispute. If the dispute is not resolved by these negotiations within 15 business days following the date of the initial written notice, the matter will be submitted to mediation in according with Section 21(b) below. (b) Except as provided herein, no civil action with respect to any dispute, claim, or controversy arising out of or relating to this Agreement may be commenced until the Parties have attempted in good faith to resolve the matter through a non -binding mediation proceeding, under the mediation procedure of the CPR Institute for Dispute Resolution ("CPR"), JAMS/Endispute, the American Arbitration Association ("AAA"), or as otherwise agreed upon by the Parties. Either Party may commence mediation by sending a written request for mediation to the other Party, within 45 business days following the expiration of the 15-business day period under subsection (a) above, setting forth the subject of the dispute and the relief requested. Unless the Parties agree otherwise in writing, a single mediator shall conduct the mediation, and the mediator shall be selected from an appropriate CPR, JAMS/Endispute, AAA or other panel as agreed upon by the Parties. The mediation shall be conducted in the county of the State in which Client has its principal office. Each Party may seek equitable relief prior to or during the mediation to preserve the status quo pending the completion of that process. Except for such an action to obtain equitable relief, neither Party may commence a civil action with respect to the matters submitted to mediation until after the completion of the internal mediation session, or 45 days after the date of filing the written request for mediation, whichever occurs first. Mediation may continue after the commencement of a civil action, if the Parties so desire. (c) The Parties further agree that in the event any dispute between them relating to this Agreement is not resolved under Section 21(a) or (b) above, exclusive jurisdiction shall be in the trial courts located within the county of the State in which Client has its principal office, any objections as to jurisdiction or venue in such court being expressly waived. (d) All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State or any other jurisdiction) that would cause the application hereto of the laws of any jurisdiction other than the laws of the State. 22. Attorney's Fees. In the event of any litigation between Parties hereto arising from or with respect to this Master Project Agreement, the Parties will each bear their own attorneys' fees and costs of the action. 23. Assignability. Client may not assign, delegate or otherwise transfer this Agreement or any of its rights or obligations hereunder without HD Supply Waterworks' prior written consent. 24. Notices. All notices and communications related to this Agreement shall be made in following address: If to Client: City of Anna Attn: City Manager I I I N. Powell Parkway Anna, Texas 75409 If to HD Supply Waterworks: HD Supply Waterworks, Ltd. 6959 State Highway 276 Royse City, TX 75189 on Shellie Rabroker HD Supply Waterworks, Ltd. 1601 S. Wall St. Belton, TX 76513 Shellie.Brinkman@HDSupply.com 25. Binding Effect. Each of Client and HD Supply Waterworks represents and warrants to the other that this Agreement has been duly authorized, executed and delivered by such Party and constitutes a legal, valid and binding agreement of such Party enforceable against such Party in accordance with its terms. 26. Modifications. This Agreement shall not be modified, waived, discharged, terminated, amended, altered or changed in any respect except by a written document signed and agreed to by both HD Supply Waterworks and Client. 27. Severability. Any term or provision 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. IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written. "HD SUPPLY WATERWORKS" HD SUPPLY WATERWORKS, LTD. By: Printed Name: Printed Title "CLIENT" City of Anna By: Printed Name: Printed Title 7 • SUPPLY. WATERWORKS Appendix A Procurement, Installation, and Management Contract Provider: HD Supply Waterworks, Ltd. ("HD Supply Waterworks") Client: City of Anna This Procurement, Installation, and Management Contract (the "Installation Contract") is an Appendix to the Master Project Agreement of even date herewith (the "Master Agreement") concerning the Project referenced in the Master Agreement. 1. Summary of Work. The Summary of Work for the Project contemplated by the Master Agreement consists of application design of the AMR system, providing and installing all Project Materials and Supplies as listed in Exhibit A-1, and management of the installation process. The purpose of this Work is to upgrade the existing system in order to provide an AMR -capable system that will meet or exceed the Factory Installation Recommendations. Summary of Work: Supply and installation of water meters, collectors and monopoles as specified in Exhibit A-1. 2. Project Implementation Period. The Project is projected to commence on the commencement date specified in the Master Agreement and will continue for a period of one year. Thereafter, this Installation Contract will automatically renew for additional periods of one year each under the same terms and conditions, until terminated by either party as specified in the Master Agreement. 3. Compensation. Client agrees to pay HD Supply Waterworks for the Project Materials and Supplies and work as described in Exhibit A-1 and additionally for each supplemental item as required by Client and agreed by the parties. In addition, Client agrees to pay HD Supply Waterworks for the Work and Services contemplated by this Installation Contract as set forth in the Master Agreement. Prices specified in Exhibit A-1 are valid for one year from the commencement date specified in the Master Agreement. Thereafter, HD Supply Waterworks will provide Client with 30 days' advance written notice of price changes. In the event the parties are unable to agree on price changes, this Installation Contract and the Master Agreement may be terminated by either party for convenience as specified in the Master Agreement. Payment terms shall be as follows: (a) Payment for Project Materials and Supplies. Client will make payment to HD Supply Waterworks for Project Materials and Supplies within 30 days of the receipt of an invoice for such Project Materials and Supplies (which will be invoiced no more frequently than weekly. No payment shall be made for Project Materials and Supplies, however, until Client shall have issued a related Acceptance Certificate, which Client shall issue promptly following its receipt of Project Materials and Supplies. (b) Draw Schedule. This Section 3(b) [ ] shall be applicable, or [ X ] shall not be applicable (mark as appropriate) to this Installation Contract. If this Section 3(b) is applicable, HD Supply Waterworks shall be entitled to percentage payment for its Work and Services in accordance with the following draw schedule: Draw Schedule: Project Start Date XX/XX/XXXX 25% Complete XX/XX/XXXX 50% XX/XX/XXXX 75% XX/XX/XXXX 100% XX/XX/XXXX No payment shall be made, however, until Client shall have issued an Acceptance Certificate with respect to such Work and Services, which Client shall issue promptly based on achievement of the draw schedule milestones set forth above. HD Supply Waterworks shall be paid for Project Materials and Supplies as set forth in Section 3(a) above. N. (c) No Draw Schedule. If the Parties have not agreed to a draw schedule in Section 3(b) above, Client shall pay HD Supply Waterworks for all Work and for Services as such Work and Services are performed, with HD Supply Waterworks to bill Client on a monthly basis for all of the foregoing. Client will make payment for all Work and Services performed under this Installation Contract within 30 days after receipt of HD Supply Waterworks' invoice for such Work and Services (which will be invoiced monthly). No payment shall be made, however, until Client shall have issued an Acceptance Certificate with respect to such Work and Services, which Client shall issue promptly based on achievement of the draw schedule milestones set forth above. HD Supply Waterworks shall be paid for Project Materials and Supplies as set forth in Section 3(a) above. (d) Financing Contract. Where the Parties have agreed to a separate Financing Contract (which is not part of this Contract, and this Contract is not part of the Financing Contract), payment shall be made as monies are advanced under the Financing Contract. 4. Installation Responsibilities of HD Supply Waterworks. (a) Project Installation. HD Supply Waterworks agrees to do the Work, provide the Services, and furnish the Project Materials and Supplies in accordance with Client's specifications that are attached to this Installation Contract during the estimated construction period listed above. HD Supply Waterworks will be responsible for installing the Project according to manufacturer standards. HD Supply Waterworks will warrant the Project Materials and Supplies, the Work, and any other Services as provided in Section 10 of the Master Agreement. Client may elect to execute a Service Contract with HD Supply Waterworks for additional maintenance provisions. (b) Water Shutoffs. HD Supply Waterworks, its agents and subcontractors, will be responsible for shutting off the water to each meter serviced as well as notifying each customer of the water shutoff. Some assistance may be required by Client with the notification of its customers. The Installation team will knock on the doors of residential customers as well as leave notifications on their doors. In the case of large commercial customers such as: schools, hospitals, nursing homes or any other commercial customer, special efforts will be made to ensure minimum disruption to their water needs. In order to prevent any damage from running flush valves or any other plumbing fixtures that are sensitive to water shutoffs, HD Supply Waterworks will schedule replacements with these commercial customers and will notify the maintenance personnel when turning the water back on at these facilities. Regardless of any effort of HD Supply Waterworks, ultimate responsibility of any and all fixtures inside buildings will remain the responsibility of the end user and/or Client as detailed in any Service Contract that exists between Client and its Customers. In the event that the service location lacks a curb stop, or it is defective, HD Supply or its representative will contact the utility. In this event the utility will either A) authorize HD Supply to repair the defect at the price as listed in appendix A-1 or, B) the utility will repair the defect themselves and notify HD Supply that the repair has been made or, C) Exclude the meter change out from the Project. (c) Meter Boxes, Vaults, and Roadways. HD Supply Waterworks is responsible for repairing any damages to meter boxes, vaults, and roadways that result from the installation of the Project; provided, however, that HD Supply Waterworks shall not be liable for pre-existing conditions or leaks. HD Supply Waterworks will install new meter boxes as authorized by the Client's representative, with appropriate lid selection, at a price mutually agreed upon. HD Supply Waterworks will not retain all existing water meters and materials pulled from the ground during the installation. (d) AMI Infrastructure Work. HD Supply Waterworks will develop a Scope of Work specific to the design, deployment, and execution of any AMI infrastructure work as per the Project needs. This Scope of Work will be tailored to the Project, as well as any site specific conditions. Once this Scope of Work is developed and mutually agreed upon by the Parties, it will become extension to the Master Project Agreement Appendix A, and as such will be binding between the parties. (e) Disposal. HD Supply Waterworks will be responsible for the disposal of all waste, debris and materials from the installation of the Project. (f) Liability. Water Meter Chan eg out: HD Supply Waterworks is responsible for any damages that occur within 6" on either side of the water meter resulting from the Project installation. Any damages incurred within this 6" area will be promptly repaired at the expense of HD Supply Waterworks. HD Supply Waterworks is not liable for damages I outside the 6" zone, either on the water distribution side or on the customer side incurred from the Project installation including shutoff, temporary outage, and restart of water service unless such damages are caused by the intentional or negligent conduct of HD Supply Waterworks, its employees, subcontractors, or agents. HD Supply Waterworks is not liable for any pre-existing conditions including leaks, faulty workmanship and materials from previous projects or rust. Should such conditions occur (i.e .leaks) HD Supply Waterworks may document them and at Client's written request repair them for a negotiated price. Back -Flow Prevention Devices: Should the Client elect to have HD Supply Waterworks install or repair any Back -Flow Prevention Devices, HD Supply Waterworks assumes no liability or responsibility for the proper functioning of these devices. HD Supply Waterworks recommends that the utility notify each customer about the potential impact of thermal expansion, but leaves this decision to the discretion of the utility. (g) Non -Covered Work. Contracted meter change outs contemplate a standard meter change out. In the event that locations exist where conditions exist which require nonstandard work (i.e. move a service location etc., move fences for or other customer structures & items for access, install systems in heavy traffic locations alleys, parking lots etc.), HD Supply and the Client will discuss pricing and work may proceed from this point or the Client may elect to excuse this work from the Project. In any event where safety concerns would cause undue risk to the work Crews. 5. Responsibilities of Client during Installation. (a) Owner -Furnished Data. Client shall provide HD Supply Waterworks all technical data in Client's possession, including previous reports, maps, surveys, and all other information in Client's possession that HD Supply Waterworks informs Client's representative is necessary as it relates to Project. Client shall be responsible for identifying the location of meters. Should HD Supply Waterworks require assistance in finding the meter location, Client shall locate the meter in a timely manner. (b) Access to Facilities and Property. Client shall make its system facilities and properties reasonably available and accessible for inspection by HD Supply Waterworks and affiliates. (c) Client Cooperation. Client support will be required during implementation of this Improvement Measure to obtain access to meter boxes/pits, infrastructure sites and to coordinate utility interruptions. Client will provide notification in its billing or by other means to its customers that HD Supply Waterworks is performing the designated work and that possible service interruption may result. (d) Timely Review. That Client through its designated representatives shall examine all invoices, and inspect all completed work by HD Supply Waterworks in a timely manner. In the event that a Client delay results in the lack of a progress payment disbursement, reserves the right to delay further work without penalty until such time as payments are made. HD Supply Waterworks further reserves all rights and options available to it under the Master Project Agreement. IN WITNESS WHEREOF, the Parties have executed this Installation Contract as of November , 2016. "HD SUPPLY WATERWORKS" HD SUPPLY WATERWORKS, LTD. Printed Name: Printed Title 10 "CLIENT" City of Anna By: Printed Name: Printed Title 11 • SUPPLY WATERWORKS Exhibit A-1 Material Procurement Summary For Installation Contract Provider: HD Supply Waterworks, Ltd. ("HD Supply Waterworks") Client: CITY OF ANNA This Material Procurement Summary is an Exhibit to and hence part of the Installation Contract contemplated by the Master Project Agreement (the "Master Agreement"), and it includes all Project Materials and Supplies to be used in connection with the Work contemplated by the Installation Contract and the Master Agreement, as the same will be identified specifically in future invoices generated by HD Supply Waterworks and attached to each Acceptance Certificate (Exhibit A-2) contained in the Installation Contract. A summary of the Project Materials and Supplies required for the Project is as follows: See attached. 12 Royse City office PROPOSAL CUSTOMER City of Anna ATTN: Steven Phone: NEP TUNE, ALL AMERICAN MADE PROJECT Mobile Read Package Enhanced 6959 Hwy 276 214-240-7805 fax 972-635-9325 TOLL FREE 1-800-225-2968 Jeff Richards AMRIAMI Product Specialist TERMS: NET 30 DATE: 111912016 Quantity Unit Size Description Unit Price Extension Neptune AMR/AMI Package Eqipment and Software 5 ea R900 GATEWAY V4 AC, UPS $ 9,375.00 $ 46,875.00 1 ea RANGER 3 XE HR2650I HANDHELD W/BLT $ 8,500.00 $ 8,500.00 1 ea MRX920 W/Panasonic Tough Book N/C N/C 1 ea N_SIGHT PLUS 5.0 Plus SOFTWARE $ 8,235.00 $ 8,235.00 Total Software/reading equip $ 63, 610.00 TRAINING & IMPLEMENTATION of SIGHT $ 7,060.00 METER INSTALL $ 180,589.00 METERS $ 910, 636.75 3 ea Install 3 V4 GATEWAYAC collectors $ 15,000.00 $ 45,000.00 1 ea 125' monopole W/V4 GATEWAY AC $ 55,556.00 $ 55,556.00 1 ea 75' monopole W/V4 GATEWAY AC $ 38,889.00 $ 38,889.00 Mobilization $ 38,669.00 $ 38,669.00 V4 GATEWAYINST. $ 178,114.00 Labor and installation/meters & e , $ 1,340,009.75 Thank you for the opportunity of submitting this quote. Royse City office PROPOSAL CUSTOMER City of Anna ATTN: Steven Phone: NEP TUNE, ALL AMERICAN MADE PROJECT Mobile Read Package Enhanced 6959 Hwy 276 214-240-7805 fax 972-635-9325 TOLL FREE 1-800-225-2968 Jeff Richards AMRIAMI Product Specialist TERMS: NET 30 DATE: 111912016 Quantity Unit Size Description Unit Price Extension Neptune AMR/AMI Package (METERS) 4412 ea R900I 5/8x3/4 Meters BRZ BTM T10 $ 189.00 $ 833,868.00 58 ea R900I 1" Meters BRZ BTM T10 $ 290.00 $ 16,820.00 5 ea R900I 1.5 Meters BRZ Body T10 $ 499.00 $ 2,495.00 42 ea R900I 2" Meters BRZ Body T10 $ 625.00 $ 26,250.00 10 ea R900I 2" Meters BRZ Body HP Turbine $ 725.00 $ 7,250.00 10 ea R900I 3" Meters BRZ Body TF Compound $ 1,106.00 $ 11,060.00 3 ea R900I 4" Meters BRZ Body TF Compound $ 2,781.25 $ 8,343.75 1 ea R900I 6" Meters BRZ Body TF Compound $ 4,550.00 $ 4,550.00 TOTAL METERS $ 910,636.75 Thank you for the opportunity of submitting this quote. Royse City office PROPOSAL CUSTOMER City of Anna ATTN: Steven Phone: NEP TUNE, ALL AMERICAN MADE PROJECT Meter Installation TERMS: NET 30 6959 Hwy 276 214-240-7805 fax 972-635-9325 TOLL FREE 1-800-225-2968 Jeff Richards AMRIAMI Product Specialist DATE: 1012512016 Quantity Unit Size Description Unit Price Extension Neptune AMR/AMI Package (METERS) 4412 ea R900I 5/8x3/4 Meters BRZ BTM T10 $ 38.00 $ 167,656.00 58 ea R900I 1" Meters BRZ BTM T10 $ 46.00 $ 2,668.00 5 ea R900I 1.5 Meters BRZ Body T10 $ 110.00 $ 550.00 42 ea R900I 2" Meters BRZ Body T10 $ 110.00 $ 4,620.00 10 ea R900I 2" Meters BRZ Body HP Turbine $ 110.00 $ 1,100.00 10 ea R900I 3" Meters BRZ Body TF Compound $ 265.00 $ 2,650.00 3 ea R900I 4" Meters BRZ Body TF Compound $ 265.00 $ 795.00 1 ea R900I 6" Meters BRZ Body TF Compound $ 550.00 $ 550.00 Meter Installation $ 180,589.00 Thank you for the opportunity of submitting this quote. Exhibit A-2 Acceptance Certificate Client under the Master Project Agreement (the "Master Agreement") with HD Supply Waterworks, Ltd. hereby certifies: This Acceptance Certificate is a Partial/Final (Circle one) Acceptance Certificate delivered under the Procurement, Installation, and Management Contract (the "Installation Contract") to which it is attached. 1. The Project Materials and Supplies listed on the attached invoice (or in the event of a final Acceptance Certificate all Project Materials and Supplies provided under the Installation Contract and the Master Agreement), have been delivered to Client. 2. Client has conducted such inspection and/or testing of the Project Materials and Supplies as it deems necessary and appropriate and hereby acknowledges that it accepts the Project Materials and Supplies for all purposes on the date indicated below. The Project Materials and Supplies have been examined and/or tested and to the best of Client's knowledge are in good operating order and condition and in all respects satisfactory to the undersigned and complies with the terms of the Installation Contract, subject, however, to the warranty provided in Section 10 of the Master Agreement. 3. Based on and the acceptance set forth herein, Client agrees that the Manufacturer's Warranty Period on all water equipment shall be deemed to have begun on the date when the manufacturer shipped such equipment and that the Manufacturer's Warranty Period shall end in accordance to the referenced warranties in Appendix D, Exhibit D-1. 4. Client has examined all Work and Services performed by HD Supply Waterworks and covered by the related invoice or draw requests and to the best of Client's knowledge finds such Work and Services to have been performed in a workmanlike manner and in accordance with all applicable specifications. Client therefore accepts such Work and Services. Based on the acceptance set forth herein, Client agrees that the Warranty Period for the Work and Services shall end on , 20 (i.e. one year from the date of shipment). The following is a punch list of items left to be completed for current phase or final phase (Circle one) of the Project: Insert Punch list Agreed to and Accepted as of , 20_ by: "CLIENT" CITY OF ANNA By: Printed Name: Printed Title 16 Appendix B (Reserved) 17 APPENDIX C (Reserved) follows: Appendix D WARRANTY The warranties on water meters included in Project Materials and Supplies, and on Work, and Services shall be as Project Materials and Supplies. (a) General. Meters and equipment included in Project Materials and Supplies that Client purchases from HD Supply Waterworks are warranted by the manufacturer to be free from Manufacturers' Defects for the period specified in the manufacturer's warranty. A copy of the present warranty of each meter manufacturer that will supply meters and equipment as part of the Project Materials and Supplies is attached hereto as Exhibit D-1. The term of such manufacturer's warranty shall be as set forth in such attached warranty (as the same may be changed from time to time during the course of the performance of the Master Agreement, but with changes to apply only to purchases of meters occurring after the change becomes effective), but generally the start date for meter and equipment warranties is the date of the manufacturer's shipment of such equipment as noted in the applicable Acceptance Certificate attached to this Agreement as Exhibit A-2 ("Manufacturer's Warranty Period"). PROJECT MATERIALS AND SUPPLIES OTHER THAN METERS and EQUIPMENT ARE NOT WARRANTED. HD SUPPLY WATERWORKS DOES NOT PROVIDE ANY SEPARATE WARRANTY FOR PROJECT MATERIALS AND SUPPLIES. (b) HD Supply Waterworks' Responsibility. Upon any breach of the manufacturer's warranty on a water meter noticed to HD Supply Waterworks during the applicable Manufacturer's Warranty Period, HD Supply Waterworks' sole responsibility shall be to cooperate with Client in arranging for the manufacturer to repair or replace any defective meters or equipment. 2. Installation Work and Services. (a) General. HD Supply Waterworks warrants that all installation Work and Services provided by HD Supply Waterworks shall be performed by HD Supply Waterworks in a workmanlike manner and in compliance with any specifications set forth in this Agreement, with such warranty to expire one year from the date when such installation Work was performed or such Services were provided (the "Warranty Period"). (b) Exclusive Remedy. Upon any breach of HD Supply Waterworks' warranty as to installation Work or Services during the applicable Warranty Period, HD Supply Waterworks' sole responsibility shall be to perform any corrective installation Work or Services necessary to bring HD Supply Waterworks' installation Work and Services into compliance with such requirements. 3. DISCLAIMER OF FURTHER WARRANTIES. EXCEPT FOR THE FOREGOING EXPRESS WARRANTY, HD SUPPLY WATERWORKS DISCLAIMS ALL EXPRESS AND IMPLIED WARRANTIES INCLUDING ALL IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL HD SUPPLY WATERWORKS BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES OF ANY KIND. 19 Exhibit D-1 Manufacturers' Warranties Attached to this Exhibit D-1 are the manufacturers' warranties for each of the manufacturers of Project Materials. 20 z l) c a) 2 - y a) o a`� a`) CD c c Y m v C c6 a .cO LE m m C.�J O a) - J Z cco E a o �- Q c ac } c m v E m a : a L o U 0 D G U) >c_ > C Y m >` N m - L CC,m U .co m C O C d O m Y y a i-+ C W Z >) a) m a + C - — Y Q u a o) a m E .E m c UX a t a L E co U a Y ,O Cn 7 M ay+ cm U G L a C cc C C m O O O ca C a O O l ■L i `> 3 a o, Q y ca CD co :j m o L ) �_ L -a) Q) T cc a Y > .--. y C (n C O O a) N a) a) 67 `m o m m c a) v o n 4 0 0 0 > o '-' o y Y n c m Z a a) LO 0 ,o Z72o c� E o -o m o a ma x '--' -C y am+ a c . y O EO w '00 2 C Ei N N m H m O a) T c� 7 W -mp a U m m m n 6] m �� ` H �- N O a) a a) m T> O m h O m QJ C CD m >- O C 7L a) O U O O C m Q) Y Y m Q) +m+ a) Z L a Cc o C a) Y U E CD a`) n m L � a) Z, > c6 y /� \ V a o m '�4g5 o E ou m c o o= m ami c n c m E o Z O m O M m ;y a) E c n w c 3 o m E O U Q O� O) n �/� t m E E n C .m .2 L �' L Q y �A � n Eo E to o L' CID N `' a�°i - m c Q c N a) �' O m o m aa)) N i a Y o a` A+ W Cl) Q m o o a � y E ai L Q 2 c2 z c U C > L E m m as o U a) i m o O U > o .� a5 's a c c m a w\ a) L _ T C/) ® co m U m O CL yW� T� om m o C 3 O O- m a) L m i T a) O ` O M. CD � z _'.. aL+ > a) -o - � LC) L Q ~ 3 L.L d � a t E aci O m t m _ m y m t0 _ m j m a) C> m c cc ~ w m c_ acc- 0 c _ y a) O a O p n.` O a) d -0 a� O p n m a) E L c E O m O- y U a a) m y Q cc m C o c-) O C ca .O O N m to m C an d m cc 6 0 C O (Q 2 CL = v cu m O LJD E a) C6 L a) m m m a) C= L O 01 Y0 0 a+a H a N- aJ m C^ a) — T O L m= C O co � _ O y -Q Q _C ` fL CL.n Co OT -o i 0 n Co Z U d cO.i F U = O] a y o m c m C U , rn m i o) T O m n— m 2 O C mLn y- m n O a) o C/) m-? cm 2 c Y O m T m Q y 0 L C /O� m m 0 U C O m C O O C — a) V L CL CD - m L .� m cn L C— O m d O Y �0 O c Y m Z o o °) m Z y v mm 2 .o A\ O W Q N a) d Q a) m n ?- O ID �i p f9 \ m -m0 C C a) a co m t� v, iy+ a) C L .G% n am+ p m y N n 0 ` Q U.D a`) a) y .c- m 6f m m o y o a) m Ci p Y Q rn U T V Y o c� �j`o a E Q O aJ N m m N O O Y T LL m 0 L a m N m '� E d \— cc., � r � d m w Z oy a) cco E m � W y y y y y W � O O O O O � Wa m m m m m � m m m m o 0 0 0 0 O O O O O d v o �o 0 0 0 W GJ � Q Lc7 = N N O M O LS') O d0 C.� C7 Q y y C O c O c O C O C O W � � O1 � � CW c 00 p0 O O O O O O W O O O O O O^ 00 � O COO Z u, N � O m y C O Cn C O m fn C O m y C O m C -- Y O O O U J .F C 4N+ E aL-+ .� E T w W d E O O N O N a aL N C� �-i O OU o) i E O- co cr W O L co C aL-+ — C aJ U o1 m O Lu O c Q) ca E O CL) O Q) O +� Q) w C L C ++ p U~ o o o U_ E o a= X Q Q m m w m > O>E aO+ U ULw a)-+ Q) O a] O L> T— Z z m Z T +LO+ C p Q m T O U C L J — o E ca c Y ° v Co N w w w J Z a -o C c O c:)~ co T 3 CD :tf«° a� p U Z 2 00 Z O o E y ,o a� ZcD- co�- Z O W O ac , '— m Qm co c m c a`ai o o c o Y o E o c E Q c u Q m x ■ o f— o 2wmJ o Q o y 3 E O� Q > m m >- o m Q o a� N .� a� o Q w a o� a h ai m 2 x z tEi W o E Y-moo m a? •� a� c 'rri 0. 'a) O C (cc6 Y C C E=+ J p Z W aJ L co O 1-8 N CD Z =Q� o� -Ey ZQcx7O co E ai a m a� 0> v3i O ca c j w z J d H Q Q Q (6 •— U .� E O .N W J m Q) m O O p T Q'o coQ N +L+ of Q M U d Z L L d cc m m E Z Q m p tz >- N _o _6 c a o Z 'a,w J CDZ BE cmQ U -O N C O w O r Q co � a Q > cc V7 � cm >; 2 ~ O O J r co a� Y L E m a� m e w m m p Z m W 'co E E a`D c E E i� a� +� a� ,� w p Q a O C L U O O m X CD C O aJ ~ J U"m O (� U Q U (o _Y, c 2 QJ _N O N a N 0 m aJ N L T= O cn C� H O a L L O a U N C-E C- m J V Cj N O N E w m co m a)< pp m Z a) E +�O a= z Q ++ a) L 0-2 _N T p CD Q NLu m N C C a)a) N T N O L aL-O a H= Z W� cD coN N-E (O Y -O E c6 J d W QJ L C N iL-� d Q) C a7 C a7 N '-' cD O) m Z c-)O O Z 'cc O O N c c-ai >=a a �'— ai�QL7cn �z `o aoi.� � vi a2 c Q �JC E a E o c2n w 0O n3 w O � .y N L E ai O O z` Ur CD (o y N co —O C T_ m C S O C Q CDz U E a . a) Y ,=--' o c m JpQ +� o m c Ni c a co °� o m d J cii o 12 m a= c m N a m c c— °' O � w Z z E z z mo m '� ai a� c a) O fi a `o a� p=— a C.c� c y z y o m E a5 o �_ cn H 'O ,3 0 0 m T L m C E Q w E c� L Zz -o a-�aiZ SQUp E m o ° O> ai ' co Z co m a> > > _ a� E Ci m c�.� c 'c m <o Z c-) x Su c O L m C o N° a`� -> O O a"ci m c°Ji ns co ai = ao o •� ? E cD o w p ~ Q co E co o N o> c m c� a o .� z 8 a� m Z a a� = n O E2 > a co c N o� S. O Q O m Q c c E y U m E@ W m 0 a�� O� coQ o o-o c a dim -a c �%=�Ow C N T L � C aJ L O E O m U O U z ._ a`o C.)' N y L o 0 o Q Q CC a E o c m a Wd -1 a= c co C. a` o C c c a m ,E S Q Z> o @ N )L `6-m Qm E m ca C� W W ED co in j > O �j c>° E N O V `o ai cm O 4 O m Q m w p- > Q > C LLU d W Q cc o o ° Y o m z�w Q aai )co aC)Ni }' >o aai -o CDJ Q m c o z E c H m m CO m .� `o a z o H J x z cn a o �y c., O ° + m Q>w LE ci 4) c-,2 > m C7 co Z'� ? o C.)Y io No m e w c/D Cl)� Q �� cL C� O N co w �wZw� O " o c �' a> > o O E O c N If w Z O v Q o G� co 'a a N a C._ O `o c Z' Q Cr x PZ> i Z E c a� Co E _o C x m. N > 2 Q w w CD C wi O .> N N ai C - C C L O H W CJ (n > �..' E E 'E ` L L a) N Q <o O L L a aJ .O 'O Q a) Z m m= aJ O � r- O a— Q) E Z O c co Y— - m co N a� } u.i O O ' c c y o co Co o >' — c aa) v} p d Y" a� 4Z. t_i a� .y a` a O a) �" o a` J z p p c E �+ _T O a� Z o ++ rNii co � '� o =o m Q w cv � Q C13y R m t N U r ID CD L (C�6 °: a T io L (C`6 aJ C C 8 T C L u c Z= Q o c co m c o m V- cc m p J o; R ID o� c R `o co R o .? c� R co u E a cv z x Q O d cD a� E m C O m aJ -O m N ° +a a M� E � � o E Lfl�� ° c .� Z���w 3 . LU uz 27 _/\ \7\ w� r z \ �& \ C[ w / ; z / \ \ � < \ LU \ CD \ < /CD § - } \ CD \ m \ ) ® \ / ± CD / § _ ./e ƒ\\ < cr / E \ \E_ \)Dƒ / -_ / \ ± 2 ) \ E } § ± ■ @ 3 y g ( / E / E5 E { s § /2 EL - k__ � Ea) / / 2 b OP( cm I \ % \ < o > _ \ \ Z \ \ 7 \ k \ \ \ $ § / > { - -00 \ k \ ■ K \ \ 2 2 CD \ \ ƒ § {■ ( R # 2 ® op _ _ ., ) \ 2 \ \ \ \ \ » / / ([ [ / ) _ 'MD/ � � y % \ y \ | — G = — - \ j j Cl- \ \ � : : � z w w� (7 5 w J Z �Q 2C/) O ro ro Q Q c c co > U U) a a L a O O a _ O C Q) Q E CD ay U U_ RS a CD y � U a aJ y O C C O O N z _Q m L E O O p w L y a3 L C a O C a3 y C,4o y a cm y O U a y CV C12 C 2 2-.- m a> > v 3 y T Q ^ O C y �F, v 'o p a U ID yc d E p a) a' :O� cc _ � 2 y U E a ID CO M Y ai O > a O >O > a y p >T O = J3 X i > h 2 O 0) a3 O h Cca O 0 p y Im o E a� a p c c ca c E cm. a . c ID a> > �' m a YC a3 � C O O y ayj � O a) E y _ca U ai C c = a) a� y <C E� E y L iCD L (Q a3 O w y Co — a) O_ /D C E Q U CD > N Z C m M CC)ID U C O o =a v co U pp p O U a) p a0 > O a CO cm a p a > a U Y a Q E m - a CD 6 O C a C C C O C O � CO = IDCO O y U O E a3 y aJ O C y ca Q . d m a a) c E cCD M c w C N 2 N O O O_ a co o a (O ca O ti Q) C y v= E a O C y a C ca -0 y a iJ C O U CD O y LJ O N y y (Q C a) ca co Cm >> C > (o a a c a C E CD E a) c O Ol c CD c � O N .0 U L � C CDa.N C O 01 (L Q) O >a C >6 > C > O Q) CU y O_ L a c E m .2 0 -�8 y U 2 '� L co a0 .� > U �_ a s E L a - a3 ai p i 1- C C/J U W, CO � d Q� wZ Z� Y C wmo Z zl" § 7E 2 7 \/% :D » wz z ( r Ld �& } �� 2 w ) \ z / \ � < $ \ \ E 2 / § / ■2 / \ _ \ - < 5 & \\ -) / ( § _ % _\ § (■_ & /{ < \ � /co \ eƒ 5 / / - - \\=t�occ }/ G \ ƒ\)) \ = e "E & <�i��e»° $ >=EƒE=e° 2y�§ $ &&2=G« $ -D\5-2& >yj/@2§ < \ E } o - C = z 2 § < Z\\\�L/\f _ \ /\/e\7»R \ } §E>C7a.�M3 / � \ \ C-3 cc \ <e...... \ } F LU � �QF- JZCl) D2� W ® w z ro = a s � f° o a o c co O N h O Cl) m Y W <7 O � m C > E O co IL O _ h C,O m cm_c �1� z z fl o? m W h d E a`� U U E W d C m O H O m 0 to Q C X O m Co O cm CL O aJ W C Cn 2' U O y O U m n p o_ •m -O rn —_ O O C O O U fl aL-+ Q Q 01 m m m y C U c z U m cc c O m i U ) -O a+ aco Q) c L O > U Q) O m y y O am L TCLQ) O L Q) U O N J QCD— _ m ) U m a C a Q " co m L E �° Z c a aci E E ti Q c O N a h 2 c •cm v� o C-) y E C C O U L WWc U Q) N m E c i U G E m > O YO O- m L Q E CD T O CID O lmn • L O `— Q U 0 H d m L y N Q) y L -p m m E m m C = > N _ 0 p O h 'c fn aai V cm > -_ o aL Eo .� M z m O E m ca X E c CDti CD-m E v a 6 E °� > Z O y (= y aC+ N Q) m CD O> _C O m •i m 'O W �••1 C CID > Q `u o 0> > a� v C o a 2 - o J Qn m o f - `o C/i o v O > - -o co ca cc z o> r.+ E a co C m E '> a`) c o o v5 A+ U Q •N a ID C1 0 6 S X o G `o a E c '� i CL - w W _ oo m a) _m m x E cn E y+ °) o a� m n y U `J O c a' c a� 0-0 Y cD z m m a) N = R (�-9 Q d CO •a N CO O- Q co fa " Q c O O (n ■ o o .� C o .y O 'm o .y c_ Q C ar c m c� E L E o Q m 0 if n `o -� `i' V m �° c� Q r0+ m aoi o m o o E o_ C7 -o cr p a 1. a� X CD h E co X C � o o f `a> c Y o p a Q O o o > a� (� m o> a`� W `o a� a s o a� E w m C Q = N Q Q E a) E N C Q) O y J Q E m o R m F -o .° o o G� L n `= L a C C- o a' m -o = c a� c y Z ti LE o` o C m s a� c� 2 X (c`6 d Q i CD c0 Q N aJ �--� �•+ h O> N i= E C` 'O Q J +••� U C a' c Co o m Y E L mtm= . E o_ c = c 2- E m • �°� C o� o- Q U o m> o � Q Q 0 O c O m Q cmi' o' m a` � E m.E5 LO m `o-o cn No c� E c o c 'a 9 _ n o E • c c m o v, � G m c a' o o n = m E m o > O 2 > ca 2 cm CD o f. E_ m aai g O o E a '� ,U 'a .0 Q E c o `o Z o Q c' d C Q a7 cn /yam C a a� y E Q N on Y a) Eco = a co 10 cD 2 p m ca ti L c a) y o 3 m o p W C F C c E M C C m E E a' ti C CL i m w a) C E ° aa) o 3 ._ c c O. ID . c 2 z� o a Y ao O c ai ao 6E.o ascm m a� ID as aai o 0 ( W CD Xw� W M,� Dmc�wSaiZQ2 G�Qc�mQmmZ wz g Z 0 0 • • • W w • • • • • Z • • • • • • • • • • • • 0 0 0 Z Q 3 \� ~ \ LU _ _/% \/ƒ r w ; z \ C � �\ rL� \ w ) z/ \ } � » < f ccCL _ § \ i cm c / - < , @ _-_ / \ ± 0 < 25- cc V 2 \ cc E _ \/ƒ/ ± O ® �\ §) < ca \ \\� �_■27M \ C? 3 � \\\�\ \ E § 2- C. 2- >< @5/Ea2« % m e.� Co § > \ r k\)®}\/ < � �/tƒ\tee } C7) • )`2\k t cc E co \ _ - E / ` a § @ CD -(a a) m » �2mysoo / § R/::::� § \ co } z p U w Z n3 c c m w cr Q~ Q U O cn "3 ao 'E E a� 'aoi Z H O w a E o cc ai c�a V! O> z Q a r Q W Z O C7 O_ � .y > O' E ca z Q W CC H J O~ �> w Z Q J_ H QQc } o a o a`� a c o `o c° O ~ oC > O � L O i C C a) C L W c0 _ G J Q z O g V) J Z ® M E E o �a_o a 3 0 0_ c c a ¢� o > O>} w 2 O Q vOv°o JU Zd 11Y� O c Z y O w W o O a� O L> Q '� N (L6 H o~C 2 W H d~> m En wQ z O T N > U U vi a) C :� Q m Q J ° O � 0 a a fl-cD cm 2 � CC cn am0�aCD \ Y 0 ~ 0 0 Q U V y Z (n C7 ~p w O ZIL vj To_ c c., Y o cn wZ O w Z Z w Z �n w Wz w CD -=o a s a x c a na c Q >,�'_, cav a o o � H O~ a Z cn W wOwcnOO c° Z� oa d CM o a`� a"i'� O cc C, E ti E J J x P-z J y T _ O d L (6 > T c � X~ c J [Q i i ''''' J W m Q Q ch a aEO+ a)U o a)Q C C O N E = >.m 2 �j J OC 0 A\ o 0 0 <° o c a w m Q a) O y CD CD Z CCC D O Z m a� 3z °;za = caca a�=LU a-o w J aJ O M . U p m y C O O L C O •N (a W d= 2 W = X m~ U m 2 U) W W C N o Q Q N C O O L W Z Q W H Q W Q cC J 2 y c . ai t 'o c � .E E O m � � w � � ~ U CD L• Q O 8 c0 W m Z W O O O_ a °� o L C— W CC', d O w Q /► C4 o v5 Ca m cu 'E Q U Lu ++ E ca`� a W� z¢ Z Cr mQozcroacn L a) a) o a o LEE S H N O >- w CD}r ~>> a o Z Q w c� O CD A! w E Z z 0 0 0 0 o W OC d �-7 Cn C7 0 L = •Y p Q a co W >_ Z Z Z 2 L o U •E a`� o ca `_' o o U d= H' Q C7 CD O h a ID.� w U d 'o UaJ O a W H W CDZ C/) Q +O+ O E C m O E (6 C m > } Z Q 2 CL Q J Q m v, o 'Q c a� m o a 6 Z v cn z oc J Q S S z U (a a O C y L O O O O C c' �' CD v� W W J (n C� Q p c* L a ° CD o a) rn c3 oo'yo > w cn Y �zWQ�g�a Cn VJ ate- L Z O = Q- V `O i L) J W a g w a) a a`� O y = o c ca O � $ a CD U NO N Z 0' C) H GC U 2 U C-) p z w W Q H V) H LU C cn Ca Z 0 cm 2 U .CL '�i Q CD a) o a70 CD- C_ —a •� m e aci y c > G Q o CC z= Z O CECD c� .Lo- ID a? E a W cn CD w w L C.(6 V O L C _? Q< w z O O U .E fQ„ J V) w L �i h N a> Gi .�. is CD X OC W w w U Q cc z w W W O m W Q o aE = E� o o ns Q w OC z0dCdccwo oo �! a o_ O 'CJ U d--- .5 CDc6 c o O U o_ Q> Lu X O CDw Q J m W J_ (./) 2 2 O o y `c co aoi o O J z o Q z= 0 C O_ m E v a •_ L fQ7 cn y J Q 2 C7 = w W N vi a� 4) aJ �z E a N O T O — m sQ�� W p z OC C7 == mE v)�¢ W L = E h U C- d 0 D O C �= oe W Z z ZO W o i c c ea c c a o E o y~~ Z a ~ Q w o o p a a� _ m cc c .— a) Z y 0 Z, O 3 f� CD N Gi O a) O� � (a Z 0 O v) O Z pJp H Q H w Z W O � Z = 01 L O L C E m Z z S2 cC ZCD d O a � od o w c a a� Q Ow Qo0 W X H e o C E Q a o ai r Q v�= cwn N cn Q LJA Y Q ry+ N C7 cccoo . L U c 'i o iri E > Y O = m c o ti c U o 2 } > Z H } 2� `' O W Z U o O �= as O L C m = Q Z= Q mo� o cc m c w h a� Q' c y a -o C7 ��.=z �� o W d Q= w Q� ���<QClw w Yd O O O >T >-Y U Y C N N E O Z N CD .0 i C an CDC O Q > = U Q C •� L>> c O > M - _F cW F L (n > Y L C > d a a) m C C C M m E QUJ _C d T a C �yV W CD -p C cc CDa) �) m CC M p p_ U O O a m m CD W m a c) QCD CD co - m cc c o a CD 0 F- c Qc } L L y W C '2 a) m N O a 00 co L •C =p ` Q m O O a z N E O r,' U d C N C C a O aJ N O vJ a m U C W Z Q CD C C E N E C y U +C- O C C Q aC N�? d W O aO+ C M C- E � C U U S O O N m o m `o - C E 1 Z 1 Q 2 m U M- m M Q� v, o Z Z m oo a ai a) o cci Eo z Z o .iD L N (m c 2 Co a c N y pm- C.7 m ti vi 't M c vi C C C O C > T n U n C7 C C M Co h O Q a m a m C cm M C C U C Y O) .E > L C aL-+ N U C p a) U O M E � L E L T M y y o c) a o �O m ai a m O C m C7 of IL E (C6ca L O ca O d �- C W N C C O E M H +C+ O O C C C -0 m co x >" W Z E E m m m C c C E L m N C N a) E C C ID C O- C m L C mp C a O) = C a) U C m m C nCD- C �-+ > C n m 2i —> L M C T n Ccc H Z W z W O m Z Z _ z E C z U Q7 O M x- N m0 C N 6C] O C y ccCD•� C ' O a'CM-0 C E M N LD m CDC .E L— C C m CDQ— '� C CD w U ` N C M E L 17 C m cmC � L O C � M L a � C m CDC LLJ 2 E U C O C >' U C CD 'O N d O C Z m m E a) N O E n m p) Q C .- �, co CD m L a p O `) m C O — W O v N ) O C C - a O •2 E oZf O U C m ® o co o o .m s a) c E m O_ OM L 00 C O O _tm aEp+ m h '_O) m n �_ E 0 LU i a C z O Cn a ao m y m C ao y N a n .E a M O z m N c) cm °' x c) >' C/i 2 O v E a C6 a) Z m m c°'. C C ? cu C w O d W (CO m iL-" o C -p y a a> Y L iL-+ c o ca n o ,L., Y C O y X J N t a C > o c C C m a L U L V z >' C m a (6 p L w O Q cn C m NO Cl) m m m '0 °� �' mo c C C a o . C aU+ o cc w o Q> Y N Y o Q g 3 m� E =m o o C E y z Q Q F' U d3 CL C Q 0 � O Q a O_ m N U O O y U +N+ m co M 'o c s E a ca o m an o W 2 2 oo M> `o 5 a M cci Co— c� U o C C y n o m c) E o m L c E c) o� co �' C M m e m p> o o m a� y o� ti c"i *o ,o, c� c) a t c m c c m o o m a w v' o m° co m p o a' C" o a c m> 'E c °' w LL a o o c� w E o y rn o� o ai p Y °J A+ W O c o Cl) n Y co c= N o m °2S a c o > �o �o p a o p co �i 'M c L " ' c Q cn y� T i ca Y� C U C CO CD d C L OM O� c (� w y> E C -O .0 -p y= Q c O" cc w 2 H d 9 Y C C aJ U L C C O d� U a) (6 O .- (�V co O E L O cn a ` O E O N iJ m C a C Q z Q C C N a m > M O +U+ C C O Co n C y O CD y a � C m C c am+ +C+ C y 2 to ♦+ Y m 2 2 M W Y m L a C Q O E C `� z m—CC YO N E a c E E N C C C M C a`� E m cL m 2 �' co W 2 C LL C CD > h CL Cl) C a co L y W C E Vi C " L aL-+ a Q C Cn -T., +L+ Y 1 . E U E m M > m N C C m' C Q E ="' (° E C O J D Q CL C Q C '� D) :5 Q) C C T co m U L m O C E Q O E O m O) m Q O) a C O X C Q J _N m a C -pC S W (>O C m C 'D C — C Q a) E m > V O) �J C E p) C o_ Z ¢� o o n 0 O d O Y CO OL `p '� C O T Z CO)N Y O m a n i m O C C 00 O - m C U m L U iC+ co N a C j-+--' U C O E E U w Q yO+ Q y C 2 O Y— c) E > > c m Q an O d o n m C+ > m C� L, M C E N E p Z T ■ T z N c Q) a) a) m C C C p_ o E m c o) L m C O �, L O V O p.-Ei p _m U Z CD /®/yyam� W Y O m C C ++ m z _ a Y C C O 0 C +N+ >� a) L N O n Q Q ■ C > U Q LLI iL-+ a=+ 0 a d O) U UO 'L-'co CL C y Y N C C L N C L n O_ Q y C y C® N L a) U co c a C C7) N m LLJ C CZS C �O Y O Q (U6 +L+ ? E N n p C O m 2 W J ■ O a iL-+ OO rn z 2i _ a) o C C �) co Co o O L-+ >j rn C a) a C C L cE d T O L T m y a a Y o cc o o 2 :N a) a J z� cc/ y 2L-+ C c aC+ O N> iC+ = U O C E m W L E o? O a C E E a n La y E V C C O E a L L y Q 0 m c y � — M 2 Q ? m Q� aci c o a z N C o f +�-' c vw7 E � y c Y° aa, C w c m U Q CD N n ac) C -ca m Q Y C o m m 3 6 w z O :Q O2 C o) � Y pOj c C M C U — cCo O p C C a c� ti 2 O n �m m y O> E- o p a Q cc co N L} m— o G> > O ab c � Q c 2 O m N co U c m= CO a'Y '� � � o V = Q Q a) � }? v' +� Q o .°)-� cfl ,m a�ni = cn fn coo M " oc z Q O C O C LL LL> ¢ c cM.i N caa c m = LL •� m W c M o c C o N— E -� -o m J w LM O aEi a) ) c`o s N y o c) E a) L a; .0 a) 'a F co c� w o U ai O W 'CO L � L C & >> .0 N � E CD d C~ C M M C ti U a Cn Pz W C y Q Co W a) — .. U lA C -o E C U L C O > 2� CO C C a p M a Q U E C +_+ fn m n 'O C -0 C m Z O_ m N C d a C c Q C M (%� 2 W V m a) L Z •�+ � cc o m m o a) rn a C oc D o a) > cd m C M c E C c .a > a) z o Q Q O i L Z d l8 .. v) d� a .E y M a) > E O C T? cm O CD N Z C/J O cc;Q Q n E. a L (06 z C C C! N O E E N C O. C) Y m h (U`O iC+ C C y = Q O E C Y C a� 2 O a Y a M M 7 O UJ T O E M C O ����o��� W ¢ ��wo _ gym wY�� O O LLJ L ��Y� y p �� C z E m O n c J U W --,,E O //_�� s= => c a) m O 'a) � cr iL-+ Y O m >, a) �n a) CU n Z w Q V H LOL > LCL E .5 -F G H C w N w L E aC+ +L-+ co H ED •C C LL �§K , W= � 2§ rl ]_ No t \ 2K 212 o _ - g - - - - � - \ - Ew _ ` 2 2No § k 2 _ .Q : : _ - .; go } ( \\I \ \ }# �}\\\\ �WE . c c - � �k) k))/\/ - \ .� % \\ v © a'� -- _ ,\/k)(2 ■ k#t± _ - ;#!` \ \ ` 2\\/)} $k\}�k =_ =z;;t§§ 2§\)\)\��� �(@\§#« --__ %| ��\/\} / \�k/\ �(}#k)) m �)(§\< 2zlflf(/{ff! ■f9(f! ■:v= _: » ,: Z a �W �amr V~7 �mmN H > g a ra = rc �m HIMf- kill� � e 01 3 m o `m' c m€? m c 3 m m gig d m m m o «mm v v �Lmc .�nQ ZE= E m H E `m �� //�� V/ c c 3 a c m « = E E w }' ? 9� a Q m m m U m iO E H 72 Zm.«m = �mv3 3 mwmo dtmdm5m �$m za5 L n4 «m " mEmgQ mo °�E Ec"'=Na R o f E _ o .- Z c �'a E 'm m m t 9 E = y �mc a !so to �n E„N L L U E V A� m Cm m r N O� 8 C'- Fm-'ay t $2$t'cm m2de .« mmcmmE; C RE d C y 3 g W N Q fl m 3 m m G y m L cu n.u�9�oE m3 m 1_ m m �. ymw_ mtm T� m Z m i Q C.m T C 6 O w0 U U 9m $ E c a nt m v r e a a >o 3 V E R E 0 m m� a c$o E" vi EEm mE acm�mc d d`ocES m ? = tr0 3 3 m E� E m `t r c m cm+ a w a c m m L'1 �` E m % g5 m a u- w 8- u a m m C .mm. r w iO E G Q "' �E� am LamZEm ? ffi..1 = Eoc.E m!c Zmn J Z r �v N V ima o o c V of 'x S m ¢ S P N r� _ 3 m C « m U m U n E m lJ E m m y d y E < `m, C m n E u n m m Q m m m_ {O m m Q y E Q E n m Z S E m m e r d m v Y a E e c2i m'� C H t na W m 3 0` c m `m m m Q s E n 3 N Z n 3 v {rl = m m a m 3 m a V Q V d N y�� 0 0 0 0 0 0 0 0 n m¢ LL o 0 v T o i . ¢ m 9 u H cm, in in e e m m N N- V' a m a a U d m w ¢ o O N m Y to rl Ommyo rr LL �p z a� r ga w5 $ Q S�=0 IL m �� 53S �y00 WZ 4 y 7 .- ����3 yZ�Uy ¢_ ¢¢ 2 U Z m m F 0 m c z m m P z O m Q- a� i � u� p m m ymm3 u m' m o�3' m� �mm zcd Upu�7 _ts 'c Em ani u m�- wimm¢zoQwo c E. mr Z'o £vvZ n E E ]03 w¢ZUZOH m o m y o �_ Z LL p a p w z U E a£ 3 ym OZ 0¢ p Z x 2 n A_` W c o 2 Z2 w o u �Lcm c.in n3 �+c�t o.c� ZOrZQTO��OO mm ZVjO¢F-� oCi Stu. Z y Z S Z 2 W v EOC=-'J u� z U m 2� m ? n ? m m m m U Z O Z j y mam - C mod Eo c�¢zp�czm-my U > E - - n 3 m m m m o •m E �` n$ y? m m ¢w�ic'i�rxi�Om QN Lam' g�Bm-c d m`na`� L t 2£ e q«m' c f� E= n � o� c my rpn2�HOs OOm cz y -'m Z Q m y E c m n9 1O E 8iw ywz¢�SCJ•1 Z_ « m m a c E m w i c Ez `m c Eo m a a m.t o.'3 m`2 �N2 Zpzx \ cm Ire ad."� w m c c my .' E m w3 ao �Zt�U> V/ m _ ..n wiz NOS _Z?2 E� yummEw �rnn ymSyist 6 0 - O o o E `c c a m y u m` n N wwZpF-wg¢m Q� -vim mmO02¢ui?yLL0 m H `m Z�i¢gQNO W — m E c = s a '^ «m'° o m m S S O w S Q -!Zr w z m_ E m c 3 E EUrD_�i �QQm , §\k R!! rl ° h� rEO : 2E _ > f - c { } \ C. E� kk/ � - - m _ }{ cr. ƒ\ | }) @ Q |/ CA _ - a _ �2 ■z : § . - -- )§{ 2: §� _ , - - k§ !(k -� - /ƒ/ k\) \ I - ; \f - ■ § t{<J; ff k}� . ! § k 2)kf$I F\E§;k[ r ■ E 2 i�®*®§f! 3 ~_m�\k\ 2\j\\}\� �_ ; „ }!\#Lu \)/� - Z i } k/ 27_\\6))k�� - �_ .- i!;§� -) ■!;■ff ±)(#7| f\\�)\, z})\\k ) �!=!k£i / f|,|t) �fik)}\ �)7$#!J}ƒ 2 _ Item No. 8. City Council Agenda Staff Report Meeting Date: 11 /22/2016 VOUR} HOMETOWN AGENDAITEM: Consider/Discuss/Action regarding a Resolution approving a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. for the Advanced Metering Infrastucture Project. (City Manager) SUMMARY: City Staff has reviewed options for funding the Advanced Metering Infrastructure Project authorized under the FY 2016-2017 Budget. Staff considered a traditional finance option through certificates of obligation and a lease/purchase proposal from US Bancorp. After evaluating the options and reviewing comments from the City's Financial Advisor, Staff is recommending the approval of a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. to finance the Project. Staff believes that the lease/purchase provides the best solution for the for the following reasons: Lower total cost Faster availability of funds No additional fees No SEC disclosure requirements. The total cost of the Project is $1,340,009.75. The lease/purchase payments would be financed over ten (10) years at a 2% interest rate. The Lease Payment Schedule shown below requires equal annual payments of $149,178.63 over ten years. Payment No. Due Date Lease Payment Principal Portion Interest Portion Termination Amount 1 11 /28/17 $149,178.63 $122,378.44 $26,800.20 NA 2 11 /28/18 $149,178.63 $124,826.01 $24,352.63 $1,125,589.46 3 11/28/19 $149,178.63 $127,322.53 $21,856.11 $994,447.26 4 11/28/20 $149,178.63 $129,868.98 $19,309.66 $860,682.22 5 11 /28/21 $149,178.63 $132,466.36 $16,712.28 $724,241.87 6 11 /28/22 $149,178.63 $135,115.68 $14,062.95 $585,072.71 7 11 /28/23 $149,178.63 $137,818.00 $11,360.64 $443,120.18 8 11/28/24 $149,178.63 $140,574.36 $8,604.28 $298,328.59 9 11 /28/25 $149,178.63 $143,385.84 $5,792.79 $150,641.17 10 11 /28/26 $149,178.63 $146,385.84 $2,952.07 0 TOTALS $1,491,786.33 $1,340,009.75 $151,776.58 Traditional certificates of obligation typically have a revenue and tax pledge as the security for the bond. With the lease/purchase option, the AMI equipment is the security. The lease/purchase option is subject to non -appropriation, meaning that the City would be required to return the equipment if the City failed to appropriate funds and make the annual lease payment. Additionally, funds authorized under the lease agreement would be deposited in an interest bearing escrow account, and all payments to the vendor will be made by US Bancorp after the City has authorized payment. The analysis prepared by the Finance department Staff in September was based on the preliminary project cost estimate of $1,295,502. The actual amount is about $45,000 more that the preliminary estimate, however the analysis and conclusions are still valid. STAFF RECOMMENDATION: Staff recommends approval of the attached Resolution and lease/purchase agreement. ATTACHMENTS: Description Lease Purchase Agreement Resolution Exhibit 1, Lease Purchase Agreement AMI Finance Plan Analysis Upload Date Type 11 /16/2016 Resolution 11 /16/2016 Exhibit 11 /16/2016 Backup Material CITY OF ANNA, TEXAS RESOLUTION NO. A RESOLUTION OF THE CITY OF ANNA, TEXAS APPROVING AND AUTHORIZING THE CITY MANAGER TO ACT ON THE CITY'S BEHALF IN EXECUTING A LEASE/PURCHASE AGREEMENT WITH U.S. BANCORP GOVERNMENT LEASING AND FINANCE, INC. FOR THE ADVANCED METERING INFRASTUCTURE PROJECT. WHEREAS, the City Council previously approved the Fiscal Year 2017 budget which included funding for the purchase of an advanced metering infrastructure system; and, WHEREAS, the City Council has authorized the City Manager to execute a Master Project Agreement with HD Supply, Ltd. for the purchase and installation of advanced metering infrastructure (the "Project"); and, WHEREAS, The City of Anna has reviewed options for funding the Project; and, WHEREAS, based on City Staff's evaluation and feedback from the City's Financial Advisor, the City Council finds that financing the Project through a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. is in the best interest of the City of Anna; and, WHEREAS, the City Council desires to authorize the City Manager to execute a Lease/Purchase Agreement with U.S. Bancorp Government Leasing and Finance, Inc. for the Project; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS, THAT: Section 1. Recitals Incorporated. The recitals above are incorporated herein as if set forth in full for all purposes. Section 2. Authorization. The City Council hereby approves the Master Tax -Exempt Lease/Purchase Agreement attached hereto as Exhibit 1, and authorizes, ratifies and approves the City Manager's execution of same. The City Manager is hereby authorized to execute all documents and to take all other actions necessary to finalize, act under, and enforce the Lease/Purchase Agreement. PASSED AND APPROVED by the City Council of the City of Anna, Texas, on this 22nd day of November 2016. ATTEST: APPROVED: City Secretary Carrie L. Smith Mayor Mike Crist DOCUMENT CHECKLIST PLEASE EXECUTE TWO (2) ORIGINALS OF ALL DOCUMENTS **NO FRONT AND BACK COPIES, PLEASE** RETURN ALL ORIGINALS TO: U.S. BANCORP GOVERNMENT LEASING AND FINANCE, INC. KEVIN JARAMILLO 950 17T" STREET, 7T" FLOOR DENVER, CO 80202 303-585-4079 ➢ Master Tax -Exempt Lease/Purchase Agreement — This document must be executed in the presence of a witness/attestor. The attesting witness does not have to be a notary, just present at the time of execution. ➢ Addendum/Amendment to Master Tax -Exempt Lease/Purchase Agreement — This document must be executed in the presence of a witness/attestor. The attesting witness does not have to be a notary, just present at the time of execution. ➢ Property Schedule No. 1 - This document must be executed in the presence of a witness/attestor. The attesting witness does not have to be a notary, just present at the time of execution. ➢ Property Description and Payment Schedule — Exhibit 1 ➢ Lessee's Counsel's Opinion — Exhibit 2. This exhibit will need to be executed by your attorney, dated and placed on their letterhead. Your attorney will likely want to review the agreement prior to executing this opinion. ➢ Lessee's General and Incumbency Certificate — Exhibit 3. Include in your return package a copy of the board minutes or resolution for our files. ➢ Payment of Proceeds Instructions — Exhibit 4. Intentionally Omitted. ➢ Acceptance Certificate — Exhibit 5. Intentionally Omitted. ➢ Bank Qualification and Arbitrage Rebate — Exhibit 6. ➢ Insurance Authorization and Verification — To be filled out by the Lessee and sent to your insurance carrier. A valid insurance certificate, or self-insurance letter if the Lessee self -insures, is required prior to funding. ➢ Notification of Tax Treatment ➢ Form 8038-G — Blank form and instructions provided to Lessee. Please consult your CPA, local legal or bond counsel to fill out. ➢ Escrow Agreement — This document needs to be executed by the Executing Official defined in the Lessee's Certificate — Exhibit 3. o Investment Direction Letter — Exhibit 1. This document needs to be executed by the Executing Official. o Schedule of Fees — Exhibit 2. o Requisition Request — Exhibit 3. This document should be retained by Lessee and utilized to request disbursements from the escrow account. Please make copies and fill out as many as are needed. o Final Acceptance Certificate - Exhibit 4. This document should be retained by Lessee and provided to Lessor once all the proceeds have been disbursed from the escrow account. o Class Action Negative Consent Letter— Exhibit 6. o IRS Form W-9. This document should be retained by Lessee and submitted with the Requisition Request(s) for each vendor being paid. Please make copies and fill out as many as are needed. Master Tax -Exempt Lease/Purchase Agreement Between: U.S. Bancorp Government Leasing and Finance, Inc. (the "Lessor") 13010 SW 68th Parkway, Suite 100 Portland, OR 97223 And: City of Anna (the "Lessee") PO Box 776 Anna, TX 75409 Attention: Joseph Johnson Telephone: 972-924-4510 Dated: November 28, 2016 ARTICLE I DEFINITIONS The following terms will have the meanings indicated below unless the context clearly requires otherwise: "Agreement" means this Master Tax -Exempt Lease/Purchase Agreement, including all exhibits and schedules attached hereto. "Code" is defined in Section 3.01(f). "Commencement Date" is the date when the term of a Property Schedule and Lessee's obligation to pay rent thereunder commences, which date shall be set forth in such Property Schedule. "Event of Default" is defined in Section 13.01. "Lease Payments" means the Lease Payments payable by Lessee under Article VI of this Agreement and each Property Schedule, as set forth in each Property Schedule. "Lease Payment Dates" means the Lease Payment dates for the Lease Payments as set forth in each Property Schedule. "Lease Term" means, with respect to a Property Schedule, the Original Term and all Renewal Terms. The Lease Term for each Property Schedule executed hereunder shall be set forth in such Property Schedule, as provided in Section 4.02. "Lessee" means the entity identified as such in the first paragraph hereof, and its permitted successors and assigns. "Lessor" means the entity identified as such in the first paragraph hereof, and its successors and assigns. "Nonappropriation Event" is defined in Section 6.06. "Original Term" means, with respect to a Property Schedule, the period from the Commencement Date until the end of the budget year of Lessee in effect at the Commencement Date. "Property" means, collectively, the property lease/purchased pursuant to this Agreement, and with respect to each Property Schedule, the property described in such Property Schedule, and all replacements, repairs, restorations, modifications and improvements thereof or thereto made pursuant to Section 8.01 or Article IX. "Property Schedule" means a Property Schedule in the form attached hereto for Property Schedule 1. Subsequent Property Schedules pursuant to this Agreement shall be numbered consecutively, beginning with Property Schedule 2. "Purchase Price" means the amount that Lessee may, in its discretion, pay to Lessor to purchase the Property under a Property Schedule, as provided in Section 11.01 and as set forth in the Property Schedule. "Renewal Terms" means the renewal terms of a Property Schedule, each having a duration of one year and a term coextensive with Lessee's budget year. "State" means the state where Lessee is located. "Vendor" means the manufacturer or contractor of the Property as well as the agents or dealers of the manufacturer or contractor from whom Lessor or Lessee purchased or is purchasing all or any portion of the Property. ARTICLE II 2.01 Property Schedules Separate Financings. Each Property Schedule executed and delivered under this Agreement shall be a separate financing, distinct from other Property Schedules. Without limiting the foregoing, upon the occurrence of an Event of Default or a Nonappropriation Event with respect to a Property Schedule, Lessor shall have the rights and remedies specified herein with respect to the Property financed and the Lease Payments payable under such Property Schedule, and except as expressly provided in Section 12.02 below, Lessor shall have no rights or remedies with respect to Property financed or Lease Payments payable under any other Property Schedules unless an Event of Default or Nonappropriation Event has also occurred under such other Property Schedules. ARTICLE III 3.01 Covenants of Lessee. As of the Commencement Date for each Property Schedule executed and delivered hereunder, Lessee shall be deemed to represent, covenant and warrant for the benefit of Lessor as follows: (a) Lessee is a public body corporate and politic duly organized and existing under the constitution and laws of the State with full power and authority to enter into this Agreement and the Property Schedule and the transactions contemplated thereby and to perform all of its obligations thereunder. (b) Lessee will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a body corporate and politic. To the extent Lessee should merge with another entity under the laws of the State, Lessee agrees that as a condition to such merger it will require that the remaining or resulting entity shall be assigned Lessee's rights and shall assume Lessee's obligations hereunder. (c) Lessee has been duly authorized to execute and deliver this Agreement and the Property Schedule by proper action by its governing body, or by other appropriate official approval, and all requirements have been met and procedures have occurred in order to ensure the validity and enforceability of this Agreement and the Property Schedule, and Lessee has complied with such public bidding requirements as may be applicable to this Agreement and the Property Schedule and the acquisition by Lessee of the Property thereunder. On or before the Commencement Date for the Property Schedule, Lessee shall cause to be delivered an opinion of counsel in substantially the form attached to the form of the Property Schedule as Exhibit 2. (d) During the Lease Term for the Property Schedule, the Property thereunder will perform and will be used by Lessee only for the purpose of performing essential governmental uses and public functions within the permissible scope of Lessee's authority. (e) Lessee will provide Lessor with current financial statements, budgets and proof of appropriation for the ensuing budget year and other financial information relating to the ability of Lessee to continue this Agreement and the Property Schedule in such form and containing such information as may be requested by Lessor. (f) Lessee will comply with all applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"), including Sections 103 and 148 thereof, and the regulations of the Treasury Department thereunder, from time to time proposed or in effect, in order to maintain the excludability from gross income for federal income tax purposes of the interest component of Lease Payments under the Property Schedule and will not use or permit the use of the Property in such a manner as to cause a Property Schedule to be a "private activity bond" under Section 141(a) of the Code. Lessee covenants and agrees that it will use the proceeds of the Property Schedule as soon as practicable and with all reasonable dispatch for the purpose for which the Property Schedule has been entered into, and that no part of the proceeds of the Property Schedule shall be invested in any securities, obligations or other investments except for the temporary period pending such use nor used, at any time, directly or indirectly, in a manner which, if such use had been reasonably anticipated on the date of issuance of the Agreement, would have caused any portion of the Property Schedule to be or become "arbitrage bonds" within the meaning of Section 103(b)(2) or Section 148 of the Code and the regulations of the Treasury Department thereunder proposed or in effect at the time of such use and applicable to obligations issued on the date of issuance of the Property Schedule. (g) The execution, delivery and performance of this Agreement and the Property Schedule and compliance with the provisions hereof and thereof by Lessee does not conflict with or result in a violation or breach or constitute a default under, any resolution, bond, agreement, indenture, mortgage, note, lease or other instrument to which Lessee is a party or by which it is bound by any law or any rule, regulation, order or decree of any court, governmental agency or body having jurisdiction over Lessee or any of its activities or properties resulting in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any property or assets of Lessee or to which it is subject. (h) Lessee's exact legal name is as set forth on the first page of this Agreement. Lessee will not change its legal name in any respect without giving thirty (30) days prior notice to Lessor. ARTICLE IV 4.01 Lease of Property. On the Commencement Date of each Property Schedule executed hereunder, Lessor will be deemed to demise, lease and let to Lessee, and Lessee will be deemed to rent, lease and hire from Lessor, the Property described in such Property Schedule, in accordance with this Agreement and such Property Schedule, for the Lease Term set forth in such Property Schedule. 4.02 Lease Term. The term of each Property Schedule shall commence on the Commencement Date set forth therein and shall terminate upon payment of the final Lease Payment set forth in such Property Schedule and the exercise of the Purchase Option described in Section 11.01, unless terminated sooner pursuant to this Agreement or the Property Schedule. 4.03 Delivery. Installation and Acceptance of Property. Lessee shall order the Property, shall cause the Property to be delivered and installed at the locations specified in the applicable Property Schedule and shall pay all taxes, delivery costs and installation costs, if any, in connection therewith. To the extent funds are deposited under an escrow agreement or trust agreement for the acquisition of the Property, such funds shall be disbursed as provided therein. When the Property described in such Property Schedule is delivered, installed and accepted as to Lessee's specifications, Lessee shall immediately accept the Property and evidence said acceptance by executing and delivering to Lessor the Acceptance Certificate substantially in the form attached to the Property Schedule. ARTICLE V 5.01 Enjoyment of Property. Lessee shall during the Lease Term peaceably and quietly have, hold and enjoy the Property, without suit, trouble or hindrance from Lessor, except as expressly set forth in this Agreement. Lessor shall not interfere with such quiet use and enjoyment during the Lease Term so long as Lessee is not in default under the subject Property Schedule. 5.02 Location; Inspection. The Property will be initially located or based at the location specified in the applicable Property Schedule. Lessor shall have the right at all reasonable times during business hours to enter into and upon the property of Lessee for the purpose of inspecting the Property. ARTICLE VI 6.01 Lease Payments to Constitute a Current Expense of Lessee. Lessor and Lessee understand and intend that the obligation of Lessee to pay Lease Payments hereunder shall constitute a current expense of Lessee and shall not in any way be construed to be a debt of Lessee in contravention of any applicable constitutional, statutory or charter limitation or requirement concerning the creation of indebtedness by Lessee, nor shall anything contained herein constitute a pledge of the faith and credit or taxing power of Lessee. Upon the appropriation of Lease Payments for a fiscal year, the Lease Payments for said fiscal year, and only the Lease Payments for said current fiscal year, shall be a binding obligation of Lessee; provided that such obligation shall not include a pledge of the taxing power of Lessee. 6.02 Payment of Lease Payments. Lessee shall promptly pay Lease Payments under each Property Schedule, exclusively from legally available funds, in lawful money of the United States of America, to Lessor in such amounts and on such dates as described in the applicable Property Schedule, at Lessor's address set forth on the first page of this Agreement, unless Lessor instructs Lessee otherwise. Lessee shall pay Lessor a charge on any delinquent Lease Payments under a Property Schedule in an amount sufficient to cover all additional costs and expenses incurred by Lessor from such delinquent Lease Payment. In addition, Lessee shall pay a late charge of five cents per dollar or the highest amount permitted by applicable law, whichever is lower, on all delinquent Lease Payments and interest on said delinquent amounts from the date such amounts were due until paid at the rate of 12% per annum or the maximum amount permitted by law, whichever is less. 6.03 Interest Component. A portion of each Lease Payment due under each Property Schedule is paid as, and represents payment of, interest, and each Property Schedule hereunder shall set forth the interest component (or method of computation thereof) of each Lease Payment thereunder during the Lease Term. 6.04 Lease Payments to be Unconditional. SUBJECT TO SECTION 6.06, THE OBLIGATIONS OF LESSEE TO PAY THE LEASE PAYMENTS DUE UNDER THE PROPERTY SCHEDULES AND TO PERFORM AND OBSERVE THE OTHER COVENANTS AND AGREEMENTS CONTAINED HEREIN SHALL BE ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS WITHOUT ABATEMENT, DIMINUTION, DEDUCTION, SET-OFF OR DEFENSE, FOR ANY REASON, INCLUDING WITHOUT LIMITATION, ANY DEFECTS, MALFUNCTIONS, BREAKDOWNS OR INFIRMITIES IN THE PROPERTY OR ANY ACCIDENT, CONDEMNATION OR UNFORESEEN CIRCUMSTANCES. THIS PROVISION SHALL NOT LIMIT LESSEE'S RIGHTS OR ACTIONS AGAINST ANY VENDOR AS PROVIDED IN SECTION 10.02. 6.05 Continuation of Lease by Lessee. Lessee intends to continue all Property Schedules entered into pursuant to this Agreement and to pay the Lease Payments thereunder. Lessee reasonably believes that legally available funds in an amount sufficient to make all Lease Payments during the term of all Property Schedules can be obtained. Lessee agrees that its staff will provide during the budgeting process for each budget year to the governing body of Lessee notification of any Lease Payments due under the Property Schedules during the following budget year. Notwithstanding this covenant, if Lessee fails to appropriate the Lease Payments for a Property Schedule pursuant to Section 6.06, such Property Schedule shall terminate at the end of the then current Original Term or Renewal Term. Although Lessee has made this covenant, in the event that it fails to provide such notice, no remedy is provided and Lessee shall not be liable for any damages for its failure to so comply. 6.06 Nonappropriation. If during the then current Original Term or Renewal Term, sufficient funds are not appropriated to make Lease Payments required under a Property Schedule for the following fiscal year, Lessee shall be deemed to not have renewed such Property Schedule for the following fiscal year and the Property Schedule shall terminate at the end of the then current Original Term or Renewal Term and Lessee shall not be obligated to make Lease Payments under said Property Schedule beyond the then current fiscal year for which funds have been appropriated. Upon the occurrence of such nonappropriation (a "Nonappropriation Event") Lessee shall, no later than the end of the fiscal year for which Lease Payments have been appropriated, deliver possession of the Property under said Property Schedule to Lessor. If Lessee fails to deliver possession of the Property to Lessor upon termination of said Property Schedule by reason of a Nonappropriation Event, the termination shall nevertheless be effective but Lessee shall be responsible for the payment of damages in an amount equal to the portion of Lease Payments thereafter coming due that is attributable to the number of days after the termination during which the Lessee fails to deliver possession and for any other loss suffered by Lessor as a result of Lessee's failure to deliver possession as required. In addition, Lessor may, by written instructions to any escrow agent who is holding proceeds of the Property Schedule, instruct such escrow agent to release all such proceeds and any earnings thereon to Lessor, such sums to be credited to Lessee's obligations under the Property Schedule and this Agreement. Lessee shall notify Lessor in writing within seven (7) days after the failure of the Lessee to appropriate funds sufficient for the payment of the Lease Payments, but failure to provide such notice shall not operate to extend the Lease Term or result in any liability to Lessee. 6.07 Defeasance of Lease Payments. Lessee may at any time irrevocably deposit in escrow with a defeasance escrow agent for the purpose of paying all of the principal component and interest component accruing under a Property Schedule, a sum of cash and non -callable securities consisting of direct obligations of, or obligations the principal of an interest on which are unconditionally guaranteed by, the United States of America or any agency or instrumentality thereof, in such aggregate amount, bearing interest at such rates and maturing on such dates as shall be required to provide funds sufficient for this purpose. Upon such defeasance, all right, title and interest of Lessor in the Property under said Property Schedule shall terminate. Lessee shall cause such investment to comply with the requirements of federal tax law so that the exclusion from gross income of the interest component of Lease Payments on said Property Schedule is not adversely affected. 6.08 Gross -Up. If an Event of Taxability occurs with respect to a Property Schedule, the interest component of Lease Payments on the Property Schedule shall thereafter be payable at the Taxable Rate, and Lessee shall pay to Lessor promptly following demand an amount sufficient to supplement prior Lease Payments on such Property Schedule so that Lessor receives the interest component of such Lease Payments, retroactive to the date as of which the interest component is determined to be includible in the gross income of Lessor for federal income tax purposes, calculated at the Taxable Rate, together with any penalties and interest actually imposed on Lessor as a result of the Event of Taxability. For purposes of this Section, "Event of Taxability" means, with respect to a Property Schedule, (a) a final determination by the Internal Revenue Service or a court of competent jurisdiction that the interest component of Lease Payments on the Property Schedule is includible for federal income tax purposes in the gross income of Lessor, or (b) receipt by Lessor of a written opinion of a nationally recognized public finance lawyer or law firm to the effect that there exists substantial doubt whether the interest component of Lease Payments on the Property Schedule is excludible for federal income tax purposes from the gross income of Lessor, in each case due to any action or failure to take action by Lessee. "Taxable Rate' means the interest rate at which the interest component of Lease Payments on a Property Schedule was originally calculated, divided by 0.65. ARTICLE VII 7.01 Title to the Property. Upon acceptance of the Property by Lessee and unless otherwise required by the laws of the State, title to the Property shall vest in Lessee, subject to Lessor's interests under the applicable Property Schedule and this Agreement. 7.02 Personal Property. The Property is and will remain personal property and will not be deemed to be affixed to or a part of the real estate on which it may be situated, notwithstanding that the Property or any part thereof may be or hereafter become in any manner physically affixed or attached to real estate or any building thereon. If requested by Lessor, Lessee will, at Lessee's expense, furnish a waiver of any interest in the Property from any party having an interest in any such real estate or building. 7.03 Security Interest. To the extent permitted by law and to secure the performance of all of Lessee's obligations under this Agreement with respect to a Property Schedule, including without limitation all Property Schedules now existing are hereafter executed, Lessee grants to Lessor, for the benefit of Lessor and its successors and assigns, a security interest constituting a first lien on Lessee's interest in all of the Property under the Property Schedule, whether now owned or hereafter acquired, all additions, attachments, alterations and accessions to the Property, all substitutions and replacements for the Property, and on any proceeds of any of the foregoing, including insurance proceeds. Lessee shall execute any additional documents, including financing statements, affidavits, notices and similar instruments, in form and substance satisfactory to Lessor, which Lessor deems necessary or appropriate to establish, maintain and perfect a security interest in the Property in favor of Lessor and its successors and assigns. Lessee hereby authorizes Lessor to file all financing statements which Lessor deems necessary or appropriate to establish, maintain and perfect such security interest. ARTICLE VIII 8.01 Maintenance of Property by Lessee. Lessee shall keep and maintain the Property in good condition and working order and in compliance with the manufacturer's specifications, shall use, operate and maintain the Property in conformity with all laws and regulations concerning the Property's ownership, possession, use and maintenance, and shall keep the Property free and clear of all liens and claims, other than those created by this Agreement. Lessee shall have sole responsibility to maintain and repair the Property. Should Lessee fail to maintain, preserve and keep the Property in good repair and working order and in accordance with manufacturer's specifications, and if requested by Lessor, Lessee will enter into maintenance contracts for the Property in form approved by Lessor and with approved providers. 8.02 Liens, Taxes, Other Governmental Charges and Utility Charges. Lessee shall keep the Property free of all levies, liens and encumbrances, except for the interest of Lessor under this Agreement. The parties to this Agreement contemplate that the Property will be used for a governmental or proprietary purpose of Lessee and, therefore, that the Property will be exempt from all property taxes. The Lease Payments payable by Lessee under this Agreement and the Property Schedules hereunder have been established to reflect the savings resulting from this exemption from taxation. Lessee will take such actions necessary under applicable law to obtain said exemption. Nevertheless, if the use, possession or acquisition of the Property is determined to be subject to taxation or later becomes subject to such taxes, Lessee shall pay when due all taxes and governmental charges lawfully assessed or levied against or with respect to the Property. Lessee shall pay all gas, water, steam, electricity, heat, power, telephone, utility and other charges incurred in the operation, maintenance, use, occupancy and upkeep of the Property. Lessee shall pay such taxes or charges as the same may become due; provided that, with respect to any such taxes or charges that may lawfully be paid in installments over a period of years, Lessee shall be obligated to pay only such installments as accrue during the then current fiscal year of the Lease Term for such Property. 8.03 Insurance. At its own expense, Lessee shall maintain (a) casualty insurance insuring the Property against loss or damage by fire and all other risks covered by the standard extended coverage endorsement then in use in the State and any other risks reasonably required by Lessor in an amount equal to at least the outstanding principal component of Lease Payments, and (b) liability insurance that protects Lessor from liability in all events in an amount reasonably acceptable to Lessor, and (c) worker's compensation insurance covering all employees working on, in, near or about the Property; provided that Lessee may self -insure against all such risks. All insurance proceeds from casualty losses shall be payable as hereinafter provided in this Agreement. All such insurance shall be with insurers that are authorized to issue such insurance in the State. All such liability insurance shall name Lessor as an additional insured. All such casualty insurance shall contain a provision making any losses payable to Lessor and Lessee as their respective interests may appear. All such insurance shall contain a provision to the effect that such insurance shall not be canceled or modified without first giving written notice thereof to Lessor and Lessee at least thirty (30) days in advance of such cancellation or modification. Such changes shall not become effective without Lessor's prior written consent. Lessee shall furnish to Lessor, on or before the Commencement Date for each Property Schedule, and thereafter at Lessor's request, certificates evidencing such coverage, or, if Lessee self -insures, a written description of its self-insurance program together with a certification from Lessee's risk manager or insurance agent or consultant to the effect that Lessee's self-insurance program provides adequate coverage against the risks listed above. 8.04 Advances. In the event Lessee shall fail to either maintain the insurance required by this Agreement or keep the Property in good repair and working order, Lessor may, but shall be under no obligation to, purchase the required insurance and pay the cost of the premiums thereof or maintain and repair the Property and pay the cost thereof. All amounts so advanced by Lessor shall constitute additional rent for the Lease Term for the applicable Property Schedule and shall be due and payable on the next Lease Payment Date and Lessee covenants and agrees to pay such amounts so advanced by Lessor with interest thereon from the date such amounts are advanced until paid at the rate of 12% per annum or the maximum amount permitted by law, whichever is less. ARTICLE IX 9.01 Damage or Destruction. If (a) the Property under a Property Schedule or any portion thereof is destroyed, in whole or in part, or is damaged by fire or other casualty, or (b) title to, or the temporary use of, the Property under a Property Schedule or any part thereof shall be taken under the exercise or threat of the power of eminent domain by any governmental body or by any person, firm or corporation acting pursuant to governmental authority, Lessor and Lessee will cause the Net Proceeds (as hereinafter defined) of any insurance claim, condemnation award or sale under threat of condemnation to be applied to the prompt replacement, repair, restoration, modification or improvement of the Property, unless Lessee shall have exercised its right to defease the Property Schedule as provided herein, or unless Lessee shall have exercised its option to purchase Lessor's interest in the Property if the Property Schedule so provides. Any balance of the Net Proceeds remaining after such work has been completed shall be paid to Lessee. For purposes of Section 8.03 and this Article IX, the term "Net Proceeds" shall mean the amount remaining from the gross proceeds of any insurance claim, condemnation award or sale under threat of condemnation after deducting all expenses, including attorneys' fees, incurred in the collection thereof. 9.02 Insufficiency of Net Proceeds. If the Net Proceeds are insufficient to pay in full the cost of any repair, restoration, modification or improvement referred to in Section 9.01, Lessee shall (a) complete such replacement, repair, restoration, modification or improvement and pay any costs thereof in excess of the amount of the Net Proceeds and, if Lessee shall make any payments pursuant to this Section, Lessee shall not be entitled to any reimbursement therefor from Lessor nor shall Lessee be entitled to any diminution of the amounts payable under Section 6.02, or (b) defease the Property Schedule pursuant to Section 6.07, or (c) exercise its option to purchase Lessor's interest in the Property pursuant to the optional purchase provisions of the Property Schedule, if any. The amount of the Net Proceeds, if any, remaining after completing such repair, restoration, modification or improvement or after such defeasance or purchase may be retained by Lessee. ARTICLE X 10.01 Disclaimer of Warranties. LESSOR MAKES NO (AND SHALL NOT BE DEEMED TO HAVE MADE ANY) WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION, THE DESIGN, OPERATION OR CONDITION OF, OR THE QUALITY OF THE MATERIAL, EQUIPMENT OR WORKMANSHIP IN, THE PROPERTY, ITS MERCHANTABILITY OR ITS FITNESS FOR ANY PARTICULAR PURPOSE, THE STATE OF TITLE THERETO OR ANY COMPONENT THEREOF, THE ABSENCE OF LATENT OR OTHER DEFECTS (WHETHER OR NOT DISCOVERABLE), AND LESSOR HEREBY DISCLAIMS THE SAME; IT BEING UNDERSTOOD THAT THE PROPERTY IS LEASED TO LESSEE "AS IS" ON THE DATE OF THIS AGREEMENT OR THE DATE OF DELIVERY, WHICHEVER IS LATER, AND ALL SUCH RISKS, IF ANY, ARE TO BE BORNE BY LESSEE. Lessee acknowledges that it has made (or will make) the selection of the Property from the Vendor based on its own judgment and expressly disclaims any reliance upon any statements or representations made by Lessor. Lessee understands and agrees that (a) neither the Vendor nor any sales representative or other agent of Vendor, is (i) an agent of Lessor, or (ii) authorized to make or alter any term or condition of this Agreement, and (b) no such waiver or alteration shall vary the terms of this Agreement unless expressly set forth herein. In no event shall Lessor be liable for any incidental, indirect, special or consequential damage in connection with or arising out of this Agreement, the Property Schedules, or the existence, furnishing, functioning or use of any item, product or service provided for in this Agreement or the Property Schedules. 10.02 Vendor's Warranties. Lessor hereby irrevocably assigns to Lessee all rights that Lessor may have to assert from time to time whatever claims and rights (including without limitation warranties) related to the Property against the Vendor. Lessee's sole remedy for the breach of such warranty, indemnification or representation shall be against the Vendor of the Property, and not against Lessor, nor shall such matter have any effect whatsoever on the rights and obligations of Lessor with respect to this Agreement, including the right to receive full and timely payments hereunder. Lessee expressly acknowledges that Lessor makes, and has made, no representations or warranties whatsoever as to the existence or the availability of such warranties of the Vendor of the Property. 10.03 Use of the Property. Lessee will not install, use, operate or maintain the Property improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by this Agreement and the applicable Property Schedule. Lessee shall provide all permits and licenses, if any, necessary for the installation and operation of the Property. In addition, Lessee agrees to comply in all respects with all laws of the jurisdiction in which its operations involving any item of Property may extend and any legislative, executive, administrative or judicial body exercising any power or jurisdiction over the items of the Property; provided that Lessee may contest in good faith the validity or application of any such law or rule in any reasonable manner that does not, in the opinion of Lessor, adversely affect the interest of Lessor in and to the Property or its interest or rights under this Agreement. Lessee shall promptly notify Lessor in writing of any pending or threatened investigation, inquiry, claim or action by any governmental authority which could adversely affect this Agreement, any Property Schedule or the Property thereunder. 10.04 Modifications. Subject to the provisions of this Section, Lessee shall have the right, at its own expense, to make alterations, additions, modifications or improvements to the Property. All such alterations, additions, modifications and improvements shall thereafter comprise part of the Property and shall be subject to the provisions of this Agreement. Such alterations, additions, modifications and improvements shall not in any way damage the Property, substantially alter its nature or cause it to be used for purposes other than those authorized under the provisions of state and federal law; and the Property, on completion of any alterations, additions, modifications or improvements made pursuant to this Section, shall be of a value which is equal to or greater than the value of the Property immediately prior to the making of such alterations, additions, modifications and improvements. Lessee shall, at its own expense, make such alterations, additions, modifications and improvements to the Property as may be required from time to time by applicable law or by any governmental authority. ARTICLE XI 11.01 Option to Purchase. Lessee shall have the option to purchase Lessor's entire interest in all of the Property subject to a Property Schedule and to terminate any restrictions herein on the Property under such Property Schedule on the last day of the Lease Term for a Property Schedule, if the Property Schedule is still in effect on such day, upon payment in full of the Lease Payments due thereunder plus payment of One (1) Dollar to Lessor. Upon exercise of the purchase option as set forth in this Section 11.01 and payment of the purchase price under the applicable Property Schedule, and performance by Lessee of all other terms, conditions and provisions hereof, Lessor shall deliver to Lessee all such documents and instruments as Lessee may reasonably require to evidence the transfer, without warranty by or recourse to Lessor, of all of Lessor's right, title and interest in and to the Property subject to such Property Schedule to Lessee. 11.02 Option to Prepay. Lessee shall have the option to prepay in whole the Lease Payments due under a Property Schedule, but only if the Property Schedule so provides, and on the terms set forth in the Property Schedule. Lessee shall give written notice to Lessor of its intent to purchase Lessor's interest in the Property at least sixty (60) days prior to the last day of the Lease Term for applicable Property Schedule. ARTICLE XII 12.01 Assignment by Lessor. Lessor's right, title and interest in, to and under each Property Schedule and the Property under such Property Schedule may be assigned and reassigned in whole or in part to one or more assignees or subassignees by Lessor without the necessity of obtaining the consent of Lessee; provided that any assignment shall not be effective until Lessee has received written notice, signed by the assignor, of the name, address and tax identification number of the assignee. Lessee shall retain all such notices as a register of all assignees and shall make all payments to the assignee or assignees designated in such register. Lessee agrees to execute all documents, including notices of assignment and chattel mortgages or financing statements that may be reasonably requested by Lessor or any assignee to protect its interests in this Agreement and the Property Schedules. 12.02 Property Schedules Separate Financings. Assignees of the Lessor's rights in one Property Schedule shall have no rights in any other Property Schedule unless such rights have been separately assigned. 12.03 Assignment and Subleasing by Lessee. NONE OF LESSEE'S RIGHT, TITLE AND INTEREST IN, TO AND UNDER THIS AGREEMENT AND IN THE PROPERTY MAY BE ASSIGNED, SUBLEASED OR ENCUMBERED BY LESSEE FOR ANY REASON, WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR. 12.04 Release and Indemnification Covenants. To the extent permitted by applicable law, Lessee shall indemnify, protect, hold harmless, save and keep harmless Lessor from and against any and all liability, obligation, loss, claim and damage whatsoever, regardless of cause thereof, and all expenses in connection therewith, including, without limitation, counsel fees and expenses, penalties and interest (collectively, "Losses") arising out of or resulting from the entering into this Agreement, any Property Schedules hereunder, the ownership of any item of the Property, the loss of federal tax exemption of the interest on any of the Property Schedules, the ordering, acquisition, use, operation, condition, purchase, delivery, rejection, storage or return of any item of the Property or any accident in connection with the operation, use, condition, possession, storage or return of any item of the Property resulting in damage to property or injury to or death to any person; provided, however, that Lessee shall not be required to indemnify Lessor for Losses arising out of or resulting from Lessor's own willful or negligent conduct, or for Losses arising out of or resulting from Lessor's preparation of disclosure material relating to certificates of participation in this Agreement and any Property Schedule (other than disclosure material provided to Lessor by Lessee). The indemnification arising under this Section shall continue in full force and effect notwithstanding the full payment of all obligations under this Agreement, or the applicable Property Schedule, or the termination of the Lease Term for such Property Schedule for any reason. ARTICLE XIII 13.01 Events of Default Defined. Any of the following shall constitute an "Event of Default" under a Property Schedule: (a) Failure by Lessee to pay any Lease Payment under the Property Schedule or other payment required to be paid with respect thereto at the time specified therein; (b) Failure by Lessee to observe and perform any covenant, condition or agreement on its part to be observed or performed with respect to the Property Schedule, other than as referred to in subparagraph (a) above, for a period of thirty (30) days after written notice specifying such failure and requesting that it be remedied is given to Lessee by Lessor, unless Lessor shall agree in writing to an extension of such time prior to its expiration; provided that, if the failure stated in the notice cannot be corrected within the applicable period, Lessor will not unreasonably withhold its consent to an extension of such time if corrective action is instituted by Lessee within the applicable period and diligently pursued until the default is corrected; (c) Any statement, representation or warranty made by Lessee in or pursuant to the Property Schedule or its execution, delivery or performance shall prove to have been false, incorrect, misleading or breached in any material respect on the date when made; (d) Lessee shall (i) apply for or consent to the appointment of a receiver, trustee, custodian or liquidator of Lessee, or of all or a substantial part of the assets of Lessee, (ii) be unable, fail or admit in writing its inability generally to pay its debts as they become due, (iii) make a general assignment for the benefit of creditors, (iv) have an order for relief entered against it under applicable federal bankruptcy law, or (v) file a voluntary petition in bankruptcy or a petition or an answer seeking reorganization or an arrangement with creditors or taking advantage of any insolvency law or any answer admitting the material allegations of a petition filed against Lessee in any bankruptcy, reorganization or insolvency proceeding; or (e) An order, judgment or decree shall be entered by any court of competent jurisdiction, approving a petition or appointing a receiver, trustee, custodian or liquidator of Lessee or of all or a substantial part of the assets of Lessee, in each case without its application, approval or consent, and such order, judgment or decree shall continue unstayed and in effect for any period of 60 consecutive days. The foregoing provisions of Section 13.01 are subject to the following limitation: if by reason of force maieure Lessee is unable in whole or in part to perform its agreements under this Agreement and the Property Schedule (other than the obligations on the part of Lessee contained in Article VI hereof) Lessee shall not be in default during the continuance of such inability. The term "force maieure" as used herein shall mean the following: acts of God; strikes, lockouts or other industrial disturbances; acts of public enemies; orders or restraints of any kind of the government of the United States or of the State or any of their departments, agencies or officials, or any civil or military authority; insurrections, riots, landslides, earthquakes, fires, storms, droughts, floods, explosions, breakage or accident to machinery, transmission pipes or canals; or any other cause or event not reasonably within the control of Lessee. A Nonappropriation Event is not an Event of Default. 13.02 Remedies on Default. Whenever any Event of Default exists with respect to a Property Schedule, Lessor shall have the right, at its sole option without any further demand or notice, to take one or any combination of the following remedial steps: (a) Without terminating the Property Schedule, and by written notice to Lessee, Lessor may declare all Lease Payments and other amounts payable by Lessee thereunder to the end of the then -current budget year of Lessee to be due, including without limitation delinquent Lease Payments under the Property Schedule from prior budget years, and such amounts shall thereafter bear interest at the rate of 12% per annum or the maximum rate permitted by applicable law, whichever is less; (b) Lessor may terminate the Property Schedule, may enter the premises where the Property subject to the Property Schedule is located and retake possession of the Property, or require Lessee, at Lessee's expense, to promptly return any or all of the Property to the possession of Lessor at such place within the United States as Lessor shall specify, and Lessor may thereafter dispose of the Property in accordance with Article 9 of the Uniform Commercial Code in effect in the State; provided, however, that any proceeds from the disposition of the property in excess of the sum required to (i) pay off any outstanding principal component of Lease Payments, (ii) pay any other amounts then due under the Property Schedule, and (iii) pay Lessor's costs and expenses associated with the disposition of the Property (including attorneys fees), shall be paid to Lessee or such other creditor of Lessee as may be entitled thereto, and further provided that no deficiency shall be allowed against Lessee except with respect to unpaid costs and expenses incurred by Lessor in connection with the disposition of the Property; (c) By written notice to any escrow agent who is holding proceeds of the Property Schedule, Lessor may instruct such escrow agent to release all such proceeds and any earnings thereon to Lessor, such sums to be credited to payment of Lessee's obligations under the Property Schedule; (d) Lessor may take any action, at law or in equity, that is permitted by applicable law and that may appear necessary or desirable to enforce or to protect any of its rights under the Property Schedule and this Agreement. Notwithstanding the foregoing, if the proceeds are insufficient to pay items (i) to (iii) in Section 13.02(b) in whole, Lessee shall remain obligated after application of proceeds to items (i) and (ii), to pay in whole the amounts for item (iii). 13.03 No Remedy Exclusive. No remedy herein conferred upon or reserved to Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle Lessor to exercise any remedy reserved to it in this Article it shall not be necessary to give any notice, other than such notice as may be required in this Article. 13.04 Costs and Attorney Fees. Upon the occurrence of an Event of Default by Lessee in the performance of any term of this Agreement, Lessee agrees to pay to Lessor or reimburse Lessor for, in addition to all other amounts due hereunder, all of Lessor's costs of collection, including reasonable attorney fees, whether or not suit or action is filed thereon. Any such costs shall be immediately due and payable upon written notice and demand given to Lessee, shall be secured by this Agreement until paid and shall bear interest at the rate of 12% per annum or the maximum amount permitted by law, whichever is less. In the event suit or action is instituted to enforce any of the terms of this Agreement, the prevailing party shall be entitled to recover from the other party such sum as the court may adjudge reasonable as attorneys' fees at trial or on appeal of such suit or action or in any bankruptcy proceeding, in addition to all other sums provided by law. ARTICLE XIV 14.01 Notices. All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when delivered or mailed by certified mail, postage prepaid, to the parties hereto at the addresses as specified on the first page of this Agreement (or at such other address as either party hereto shall designate in writing to the other for notices to such party), to any assignee at its address as it appears on the registration books maintained by Lessee. 14.02 Arbitrage Certificates. Unless a separate Arbitrage Certificate is delivered on the Commencement Date, Lessee shall be deemed to make the following representations and covenants as of the Commencement Date for each Property Schedule: (a) The estimated total costs, including taxes, freight, installation, and cost of issuance, of the Property under the Property Schedule will not be less than the total principal amount of the Lease Payments. (b) The Property under the Property Schedule has been ordered or is expected to be ordered within six months after the Commencement Date and the Property is expected to be delivered and installed, and the Vendor fully paid, within eighteen months from the Commencement Date. Lessee will pursue the completion of the Property and the expenditure of the net proceeds of the Property Schedule with due diligence. (c) Lessee has not created or established, and does not expect to create or establish, any sinking fund or other similar fund (i) that is reasonably expected to be used to pay the Lease Payments under the Property Schedule, or (ii) that may be used solely to prevent a default in the payment of the Lease Payments under the Property Schedule. (d) The Property under the Property Schedule has not been and is not expected to be sold or otherwise disposed of by Lessee, either in whole or in major part, prior to the last maturity of the Lease Payments under the Property Schedule. (a) There are no other obligations of Lessee which (i) are being sold within 15 days of the Commencement Date of the Property Schedule; (ii) are being sold pursuant to the same plan of financing as the Property Schedule; and (iii) are expected to be paid from substantially the same source of funds. (f) The officer or official who has executed the Property Schedule on Lessee's behalf is familiar with Lessee's expectations regarding the use and expenditure of the proceeds of the Property Schedule. To the best of Lessee's knowledge, information and belief, the facts and estimates set forth in herein are accurate and the expectations of Lessee set forth herein are reasonable. 14.03 Further Assurances. Lessee agrees to execute such other and further documents, including, without limitation, confirmatory financing statements, continuation statements, certificates of title and the like, and to take all such action as may be necessary or appropriate, from time to time, in the reasonable opinion of Lessor, to perfect, confirm, establish, reestablish, continue, or complete the interests of Lessor in this Agreement and the Property Schedules, to consummate the transactions contemplated hereby and thereby, and to carry out the purposes and intentions of this Agreement and the Property Schedules. 14.04 Binding Effect. This Agreement shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. 14.05 Severabilitv. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 14.06 Waiver of Jury Trials. Lessee and Lessor hereby irrevocably waive all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Agreement or the actions of Lessor or Lessee in the negotiation, administration, performance or enforcement hereof. 14.07 Amendments, Changes and Modifications. This Agreement may be amended in writing by Lessor and Lessee to the extent the amendment or modification does not apply to outstanding Property Schedules at the time of such amendment or modification. The consent of all assignees shall be required to any amendment or modification before such amendment or modification shall be applicable to any outstanding Property Schedule. 14.08 Execution in Counterparts. This Agreement and the Property Schedules hereunder may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. 14.09 Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State. 14.10 Captions. The captions or headings in this Agreement are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement. IN WITNESS WHEREOF, Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives as of the date first above written. Lessor: U.S. Bancorp Government Leasing and Finance, Inc. By: Name: Title: Lessee: City of Anna Name: Title: Attest: By: Name: Title: ADDENDUM (TEXAS) Master Tax -Exempt Lease/Purchase Agreement (Use addendum with each Property Schedule) THIS ADDENDUM, which is entered into as of November 28, 2016 between U.S. Bancorp Government Leasing and Finance, Inc. ("Lessor") and City of Anna ("Lessee"), is intended to modify and supplement the Master Tax -Exempt Lease/Purchase Agreement, dated as of November 28, 2016, between Lessor and Lessee (the "Master Agreement"), and is intended to modify and supplement Property Schedule No. 1 (the "Property Schedule") to the Master Agreement of even date herewith. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Master Agreement. The Master Agreement is amended to delete Section 6.05. 2 Lessor and Lessee agree that lease participation certificates in any Property Schedule shall not be issued without the approval of the Texas Attorney General. 3. Lessee represents and warrants pursuant to Texas Government Code Section 2252.908 and Texas Administrative Code Chapter 46 the following (select one of the applicable): Lessee has received the required "disclosure of interested parties" from Lessor that was submitted by Lessor to the Texas State Ethics Commission. The Property Schedule is for less than $1,000,000 and the following applies: (a) the governing body of Lessee has legal authority to delegate to its staff the authority to execute the Property Schedule; (b) the governing body of the Lessee has delegated to its staff the authority to execute the Property Schedule; and (c) the governing body of the Lessee did not participate in the selection of the business entity with which the Property Schedule is entered into. 4. The following shall be included in the Opinion of Lessee's Counsel provided to Lessor for the Property Schedule: 9. Texas Government Code Section 2252.908 and Texas Administrative Code Chapter 46 have been complied with by either filing of the required "disclosure of interested parties" to the Texas State Ethics Commission and the Lessee or due to the Property Schedule being less than $1,000,000 in value and the following applying: (a) the governing body of Lessee has legal authority to delegate to its staff the authority to execute the Property Schedule; (b) the governing body of the Lessee has delegated to its staff the authority to execute the Property Schedule; and (c) the governing body of the Lessee did not participate in the selection of the business entity with which the Property Schedule is entered into. IN WITNESS WHEREOF, Lessor and Lessee have caused this Addendum to be executed in their names by their duly authorized representatives as of the date first above written. Lessor: U.S. Bancorp Government Leasing and Finance, Inc. B: Name: Title: Lessee: City of Anna By: Name: Title: Attest: By Name: Title: Property Schedule No. 1 Master Tax -Exempt Lease/Purchase Agreement This Property Schedule No. 1 is entered into as of the Commencement Date set forth below, pursuant to that certain Master Tax -Exempt Lease/Purchase Agreement (the "Master Agreement"), dated as of November 28, 2016, between U.S. Bancorp Government Leasing and Finance, Inc., and City of Anna. 1. Interpretation. The terms and conditions of the Master Agreement are incorporated herein by reference as if fully set forth herein. Reference is made to the Master Agreement for all representations, covenants and warranties made by Lessee in the execution of this Property Schedule, unless specifically set forth herein. In the event of a conflict between the provisions of the Master Agreement and the provisions of this Property Schedule, the provisions of this Property Schedule shall control. All capitalized terms not otherwise defined herein shall have the meanings provided in the Master Agreement. 2. Commencement Date. The Commencement Date for this Property Schedule is November 28, 2016. 3. Property Description and Payment Schedule. The Property subject to this Property Schedule is described in Exhibit 1 hereto. Lessee shall not remove such property from the locations set forth therein without giving prior written notice to Lessor. The Lease Payment Schedule for this Property Schedule is set forth in Exhibit 1. 4. Opinion. The Opinion of Lessee's Counsel is attached as Exhibit 2. 5. Lessee's Certificate. The Lessee's Certificate is attached as Exhibit 3. 6. Proceeds. Exhibit 4 is intentionally omitted. 7. Acceptance Certificate. Exhibit 5 is intentionally omitted. 8. Additional Purchase Option Provisions. In addition to the Purchase Option provisions set forth in the Master Agreement, Lease Payments payable under this Property Schedule shall be subject to prepayment in whole at any time by payment of the applicable Termination Amount set forth in Exhibit 1 (Payment Schedule) and payment of all accrued and unpaid interest through the date of prepayment. 9. Private Activity Issue. Lessee understands that among other things, in order to maintain the exclusion of the interest component of Lease Payments from gross income for federal income tax purposes, it must limit and restrict the rights private businesses (including, for this purpose, the federal government and its agencies and organizations described in the Code § 501(c)(3)) have to use the Property. Each of these requirements will be applied beginning on the later of the Commencement Date or date each portion of the Property is placed in service and will continue to apply until earlier of the end of the economic useful life of the property or the date the Agreement or any tax-exempt obligation issued to refund the Property Schedule is retired (the "Measurement Period"). Lessee will comply with the requirements of Section 141 of the Code and the regulations thereunder which provide restrictions on special legal rights that users other than Lessee or a state or local government or an agency or instrumentality of a state or a local government (an "Eligible User") may have to use the Property. For this purpose, special legal rights may arise from a management or service agreement, lease, research agreement or other arrangement providing any entity except an Eligible User the right to use the Property. Any use of the Property by a user other than an Eligible User is referred to herein as "Non -Qualified Use". Throughout the Measurement Period, all of the Property is expected to be owned by Lessee. Throughout the Measurement Period, Lessee will not permit the Non -Qualified Use of the Property to exceed 10%. 10. Bank Qualification and Arbitrage Rebate. Attached as Exhibit 6. 11. Expiration. Lessor, at its sole determination, may choose not to accept this Property Schedule if the fully executed, original Master Agreement (including this Property Schedule and all ancillary documents) is not received by Lessor at its place of business by November 28, 2016. IN WITNESS WHEREOF, Lessor and Lessee have caused this Property Schedule to be executed in their names by their duly authorized representatives as of the Commencement Date above. Lessor: U.S. Bancorp Government Leasing and Finance, Inc. B: Name: Title: Lessee: City of Anna Name Title: Attest: By Name: Title: EXHIBIT 1 jProperty Description and Payment Schedule Re: Property Schedule No. 1 to Master Tax -Exempt Lease/Purchase Agreement between U.S. Bancorp Government Leasing and Finance, Inc. and City of Anna. THE PROPERTY IS AS FOLLOWS: The Property as more fully described in Exhibit A incorporated herein by reference and attached hereto. It includes all replacements, parts, repairs, additions, accessions and accessories incorporated therein or affixed or attached thereto and any and all proceeds of the foregoing, including, without limitation, insurance recoveries. PROPERTY LOCATION: Address City, State Zip Code USE: HD Water Meters - This use is essential to the proper, efficient and economic functioning of Lessee or to the services that Lessee provides; and Lessee has immediate need for and expects to make immediate use of substantially all of the Property, which need is not temporary or expected to diminish in the foreseeable future. Lease Payment Schedule Total Principal Amount: $1,340,009.75 Payment No. Due Date Lease Payment Principal Portion Interest Portion Termination Amount (After Making Payment for said Due Date) 1 28-Nov-2017 149,178.63 122,378.44 26,800.20 NA 2 28-Nov-2018 149,178.63 124,826.01 24,352.63 1,125,589.46 3 28-Nov-2019 149,178.63 127,322.53 21,856.11 994,447.26 4 28-Nov-2020 149,178.63 129,868.98 19,309.66 860,682.22 5 28-Nov-2021 149,178.63 132,466.36 16,712.28 724,241.87 6 28-Nov-2022 149,178.63 135,115.68 14,062.95 585,072.71 7 28-Nov-2023 149,178.63 137,818.00 11,360.64 443,120.18 8 28-Nov-2024 149,178.63 140,574.36 8,604.28 298,328.59 9 28-Nov-2025 149,178.63 143,385.84 5,792.79 150,641.17 10 28-Nov-2026 149,178.63 146,253.56 2,925.07 0.00 TOTALS 1,491,786.33 1,340,009.75 151,776.58 Interest Rate: 2.000% Lessee: City of Anna Name: Title: EXHIBIT Property Description Advanced Metering Infrastructure EXHIBIT 2 Lessee's Counsel's Opinion [To be provided on letterhead of Lessee's counsel.] November 28, 2016 U.S. Bancorp Government Leasing and Finance, Inc 13010 SW 68th Parkway, Suite 100 Portland, OR 97223 City of Anna PO Box 776 Anna, TX 75409 Attention: Joseph Johnson RE: Property Schedule No. 1 to Master Tax -Exempt Lease/Purchase Agreement between U.S. Bancorp Government Leasing and Finance, Inc. and City of Anna. Ladies and Gentlemen: We have acted as special counsel to City of Anna ("Lessee"), in connection with the Master Tax -Exempt Lease/Purchase Agreement, dated as of November 28, 2016 (the "Master Agreement"), between City of Anna, as lessee, and U.S. Bancorp Government Leasing and Finance, Inc. as lessor ("Lessor"), and the execution of Property Schedule No. 1 (the "Property Schedule") pursuant to the Master Agreement. We have examined the law and such certified proceedings and other papers as we deem necessary to render this opinion. All capitalized terms not otherwise defined herein shall have the meanings provided in the Master Agreement and Property Schedule. As to questions of fact material to our opinion, we have relied upon the representations of Lessee in the Master Agreement and the Property Schedule and in the certified proceedings and other certifications of public officials furnished to us without undertaking to verify the same by independent investigation. Based upon the foregoing, we are of the opinion that, under existing law: 1. Lessee is a public body corporate and politic, duly organized and existing under the laws of the State, and has a substantial amount of one or more of the following sovereign powers: (a) the power to tax, (b) the power of eminent domain, and (c) the police power. 2. Lessee has all requisite power and authority to enter into the Master Agreement and the Property Schedule and to perform its obligations thereunder. 3. The execution, delivery and performance of the Master Agreement and the Property Schedule by Lessee has been duly authorized by all necessary action on the part of Lessee. 4. All proceedings of Lessee and its governing body relating to the authorization and approval of the Master Agreement and the Property Schedule, the execution thereof and the transactions contemplated thereby have been conducted in accordance with all applicable open meeting laws and all other applicable state and federal laws. 5. Lessee has acquired or has arranged for the acquisition of the Property subject to the Property Schedule, and has entered into the Master Agreement and the Property Schedule, in compliance with all applicable public bidding laws. 6. Lessee has obtained all consents and approvals of other governmental authorities or agencies which may be required for the execution, delivery and performance by Lessee of the Master Agreement and the Property Schedule. 7. The Master Agreement and the Property Schedule have been duly executed and delivered by Lessee and constitute legal, valid and binding obligations of Lessee, enforceable against Lessee in accordance with the terms thereof, except insofar as the enforcement thereof may be limited by any applicable bankruptcy, insolvency, moratorium, reorganization or other laws of equitable principles of general application, or of application to municipalities or political subdivisions such as the Lessee, affecting remedies or creditors' rights generally, and to the exercise of judicial discretion in appropriate cases. 8. As of the date hereof, based on such inquiry and investigation as we have deemed sufficient, no litigation is pending, (or, to our knowledge, threatened) against Lessee in any court (a) seeking to restrain or enjoin the delivery of the Master Agreement or the Property Schedule or of other agreements similar to the Master Agreement; (b) questioning the authority of Lessee to execute the Master Agreement or the Property Schedule, or the validity of the Master Agreement or the Property Schedule, or the payment of principal of or interest on, the Property Schedule; (c) questioning the constitutionality of any statute, or the validity of any proceedings, authorizing the execution of the Master Agreement and the Property Schedule; or (d) affecting the provisions made for the payment of or security for the Master Agreement and the Property Schedule. 9. Texas Government Code Section 2252.908 and Texas Administrative Code Chapter 46 have been complied with by either filing of the required "disclosure of interested parties" to the Texas State Ethics Commission and the Lessee or due to the Property Schedule being less than $1,000,000 in value and the following applying: (a) the governing body of Lessee has legal authority to delegate to its staff the authority to execute the Property Schedule; (b) the governing body of the Lessee has delegated to its staff the authority to execute the Property Schedule; and (c) the governing body of the Lessee did not participate in the selection of the business entity with which the Property Schedule is entered into. This opinion may be relied upon by Lessor, its successors and assigns, and any other legal counsel who provides an opinion with respect to the Property Schedule. Very truly yours, By: _ Name: Title: Dated: EXHIBIT 3 Lessee's General and Incumbency Certificate GENERAL CERTIFICATE Re: Property Schedule No. 1 dated as of November 28, 2016 to the Master Tax -Exempt Lease/Purchase Agreement dated November 28, 2016 between U.S. Bancorp Government Leasing and Finance, Inc. and City of Anna. The undersigned, being the duly elected, qualified and acting (Title of Person to Execute Lease/Purchase Agreement) of the City of Anna ("Lessee") does hereby certify, as of November 28, 2016, as follows: 1. Lessee did, at a meeting of the governing body of the Lessee, by resolution or ordinance duly enacted, in accordance with all requirements of law, approve and authorize the execution and delivery of the above -referenced Property Schedule (the "Property Schedule") and the Master Tax -Exempt Lease/Purchase Agreement (the "Master Agreement') by the undersigned. 2. The meeting(s) of the governing body of the Lessee at which the Master Agreement and the Property Schedule were approved and authorized to be executed was duly called, regularly convened and attended throughout by the requisite quorum of the members thereof, and the enactment approving the Master Agreement and the Property Schedule and authorizing the execution thereof has not been altered or rescinded. All meetings of the governing body of Lessee relating to the authorization and delivery of Master Agreement and the Property Schedule have been: (a) held within the geographic boundaries of the Lessee; (b) open to the public, allowing all people to attend; (c) conducted in accordance with internal procedures of the governing body; and (d) conducted in accordance with the charter of the Lessee, if any, and the laws of the State. 3. No event or condition that constitutes, or with the giving of notice or the lapse of time or both would constitute, an Event of Default or a Nonappropriation Event (as such terms are defined in the Master Agreement) exists at the date hereof with respect to this Property Schedule or any other Property Schedules under the Master Agreement. 4. The acquisition of all of the Property under the Property Schedule has been duly authorized by the governing body of Lessee. 5. Lessee has, in accordance with the requirements of law, fully budgeted and appropriated sufficient funds for the current budget year to make the Lease Payments scheduled to come due during the current budget year under the Property Schedule and to meet its other obligations for the current budget year and such funds have not been expended for other purposes. 6. As of the date hereof, no litigation is pending, (or, to my knowledge, threatened) against Lessee in any court (a) seeking to restrain or enjoin the delivery of the Master Agreement or the Property Schedule or of other agreements similar to the Master Agreement; (b) questioning the authority of Lessee to execute the Master Agreement or the Property Schedule, or the validity of the Master Agreement or the Property Schedule, or the payment of principal of or interest on, the Property Schedule; (c) questioning the constitutionality of any statute, or the validity of any proceedings, authorizing the execution of the Master Agreement and the Property Schedule; or (d) affecting the provisions made for the payment of or security for the Master Agreement and the Property Schedule. IN WITNESS WHEREOF, the undersigned has executed this Certificate as of November 28, 2016. City of Anna By Signature of Person to Execute Lease/Purchase Agreement Print Name and Title of Person to Execute Lease/Purchase Agreement INCUMBENCY CERTIFICATE Re: Property Schedule No. 1 dated as of November 28, 2016 to the Master Tax -Exempt Lease/Purchase Agreement dated as of November 28, 2016 between U.S. Bancorp Government Leasing and Finance, Inc. and City of Anna. The undersigned, being the duly elected, qualified and acting Secretary or Clerk of the City of Anna ("Lessee") does hereby certify, as of November 28, 2016, as follows: As of the date of the meeting(s) of the governing body of the Lessee at which the above -referenced Master Agreement and the Property Schedule were approved and authorized to be executed, and as of the date hereof, the below -named representative of the Lessee held and holds the office set forth below, and the signature set forth below is his/her true and correct signature. (Signature of Person to Execute Lease/Purchase Agreement) (Print Name and Title) IN WITNESS WHEREOF, the undersigned has executed this Certificate as of November 28, 2016. Secretary/Clerk Print Name and Title: EXHIBIT4 Payment of Proceeds Instructions Intentionally Omitted. EXHIBIT 5 cceptance Certificate Intentionally Omitted. EXHIBIT 6 Bank Qualification And Arbitrage Rebate U.S. Bancorp Government Leasing and Finance, Inc. 13010 SW 68th Parkway, Suite 100 Portland, OR 97223 Re: Property Schedule No. 1 to Master Tax -Exempt Lease/Purchase Agreement between U.S. Bancorp Government Leasing and Finance, Inc. and City of Anna PLEASE CHECK EITHER: Bank Qualified Tax -Exempt Obligation under Section 265 Lessee hereby designates this Property Schedule as a "qualified tax-exempt obligation" as defined in Section 265(b)(3)(B) of the Code. Lessee reasonably anticipates issuing tax-exempt obligations (excluding private activity bonds other than qualified 501(c)(3) bonds and including all tax-exempt obligations of subordinate entities of the Lessee) during the calendar year in which the Commencement Date of this Property Schedule falls, in an amount not exceeding $10,000,000. or Not applicable. Arbitrage Rebate Eighteen Month Exception: Pursuant to Treasury Regulations Section 1.148-7(d), the gross proceeds of this Property Schedule will be expended for the governmental purposes for which this Property Schedule was entered into, as follows: at least 15% within six months after the Commencement Date, at least 60% within 12 months after the Commencement Date, and 100% within 18 months after the Commencement Date. If Lessee is unable to comply with Section 1.148-7(d) of the Treasury Regulations, Lessee shall compute rebatable arbitrage on this Agreement and pay rebatable arbitrage to the United States at least once every five years, and within 60 days after payment of the final Lease Payment due under this Agreement. Consult tax counsel if there is any chance that the Eighteen Month Exception will not be met. Lessee: City of Anna Name: Title: *Please be sure to select ONE option above. Language for UCC Financinq Statements Property Schedule No. 1 SECURED PARTY: U.S. Bancorp Government Leasing and Finance, Inc. DEBTOR: City of Anna This financing statement covers all of Debtor's right, title and interest, whether now owned or hereafter acquired, in and to the equipment leased to Debtor under Property Schedule No. 1 dated November 28, 2016 to that certain Master Tax -Exempt Lease/Purchase Agreement dated as of November 28, 2016, in each case between Debtor, as Lessee, and Secured Party, as Lessor, together with all accessions, substitutions and replacements thereto and therefore, and proceeds (cash and non -cash), including, without limitation, insurance proceeds, thereof, including without limiting, all equipment described on Exhibit A attached hereto and made a part hereof. Debtor has no right to dispose of the equipment. INSURANCE AUTHORIZATION AND VERIFICATION Date: November 28, 2016 Property Schedule No: 1 To: City of Anna (the "Lessee") From: U.S. Bancorp Government Leasing and Finance, Inc. (the "Lessor") 1310 Madrid St. Marshall, MN 56258 Attn: Kevin Jaramillo TO THE LESSEE: In connection with the above -referenced Property Schedule, Lessor requires proof in the form of this document, executed by both Lessee* and Lessee's agent, that Lessee's insurable interest in the financed property (the "Property") meets Lessor's requirements as follows, with coverage including, but not limited to, fire, extended coverage, vandalism, and theft: Lessor, AND ITS SUCCESSORS AND ASSIGNS, shall be covered as both ADDITIONAL INSURED and LENDER'S LOSS PAYEE with regard to all equipment financed or leased by policy holder through or from Lessor. All such insurance shall contain a provision to the effect that such insurance shall not be canceled or modified without first giving written notice thereof to Lessor and Lessee at least thirty (30) days in advance of such cancellation or modification. Lessee must carry GENERAL LIABILITY (and/or, for vehicles, Automobile Liability) in the amount of no less than $1,000,000.00 (one million dollars). Lessee must carry PROPERTY Insurance (or, for vehicles, Physical Damage Insurance) in an amount no less than the 'Insurable Value' $1,340,009.75, with deductibles no more than $10,000.00. *Lessee: Please execute this form and return with your document package. Lessor will fax this form to your insurance agency for endorsement. In lieu of agent endorsement, Lessee's agency may submit insurance certificates demonstrating compliance with all requirements. Should you have any questions, please contact Kevin Jaramillo at 303-585-4079. By signing, Lessee authorizes the Agent named below: 1) to complete and return this form as indicated; and 2) to endorse the policy and subsequent renewals to reflect the required coverage as outlined above. Agency/Agent: Address: Phone/Fax: Email: Lessee: City of Anna Name: Title: TO THE AGENT: In lieu of providing a certificate, please execute this form in the space below and promptly fax it to Lessor at 303-585-4732. This fully endorsed form shall serve as proof that Lessee's insurance meets the above requirements. Agent hereby verifies that the above requirements have been met in regard to the Property listed below. Print Name of Agency: X By: X (Agent's Signature) Print Name: X Date: Insurable Value: $1,340,009.75 ATTACHED: PROPERTY DESCRIPTION FOR PROPERTY SCHEDULE NO.: 1 Notification of Tax Treatment to Tax -Exempt Lease/Purchase Agreement This Notification of Tax Treatment is pursuant to the Master Tax -Exempt Lease/Purchase Agreement dated as of November 28, 2016 and the related Property Schedule No. 1 dated November 28, 2016, between Lessor and Lessee (the "Agreement"). Lessee agrees that this Property Schedule SHOULD be subject to sales/use taxes Lessee agrees that this Property Schedule should NOT be subject to sales/use taxes and Lessee has included our tax -exemption certificate with this document package X Lessee agrees that this Property Schedule should NOT be subject to sales/use taxes and no tax - exemption certificate is issued to us by the State Lessee agrees that this Property Schedule is a taxable transaction and subject to any/all taxes Lessee agrees that this Property Schedule is subject to sales/use taxes and will pay those taxes directly to the State or Vendor IN WITNESS WHEREOF, Lessee has caused this Notification of Tax Treatment to be executed by their duly authorized representative. Lessee: City of Anna Name: Title: Form 8038-G Information Return for Tax -Exempt Governmental Obligations (Rev. September 2011) ► Under Internal Revenue Code section 149(e) OMB No. 1545-0720 ► See separate instructions. Department of the Treasury Internal Revenue Service Caution: If the issue price is under $100,000, use Form 8038-GC. Reporting Authority If Amended Return, check here ► ❑ 1 Issuer's name 2 Issuer's employer identification number (EIN) 3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instructions) 3b Telephone number of other person shown on 3a 4 Number and street (or P.O. box if mail is not delivered to street address) Room/suite 5 Report number (For IRS Use Only) 3 6 City, town, or post office, state, and ZIP code 7 Date of issue 8 Name of issue 9 CUSIP number 10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see instructions) 10b Telephone number of officer or other employee shown on 10a Type of Issue (enter the issue price). See the instructions and attach schedule. 11 Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Health and hospital . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Public safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Environment (including sewage bonds) . . . . . . . . . . . . . . . . . . . . 16 Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Other. Describe ► 11 12 13 14 15 16 17 18 19 If obligations are TANS or RANs, check only box 19a . . . . . . . . . . . . . ► ❑ If obligations are BANS, check only box 19b . . . . . . . . . . . . . . . . ► ❑ 20 If obligations are in the form of a lease or installment sale, check box . . . . . . . . ► ❑ Description of Obligations. Complete for the entire issue for which this form is being filed. (a) Final maturity date (b) Issue price (c) Stated redemption price at maturity (d) Weighted average maturity (e) Yield 21 $ $ years LiULW 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 25 Proceeds used for credit enhancement . . . . . . . . . . . . 25 26 Proceeds allocated to reasonably required reserve or replacement fund . 26 27 Proceeds used to currently refund prior issues . . . . . . . . . 27 28 Proceeds used to advance refund prior issues . . . . . . . . . 28 29 Total (add lines 24 through 28) . . . . . . . . . . . . . . . . . . . . . . . 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) . . . 22 23 29 30 Description of Refunded Bonds. Complete this part only for refunding bonds. 31 Enter the remaining weighted average maturity of the bonds to be currently refunded . . . . ► years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded . . . . ► years 33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) . . . . . . ► 34 Enter the date(s) the refunded bonds were issued ► (MM/DD/YYYY) For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 63773S Form 8038-G (Rev. 9-2011) Form 8038-G (Rev. 9-2011) Page 2 LiULU Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) . . . . 35 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIC) (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . 36a b Enter the final maturity date of the GIC ► c Enter the name of the GIC provider ► 37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental units . . . . . . . . . . . . . . . . . . . . . . . . 37 38a If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► ❑ and enter the following information: b Enter the date of the master pool obligation Blo- c Enter the EIN of the issuer of the master pool obligation ► d Enter the name of the issuer of the master pool obligation ► 39 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box . . . . ► ❑ 40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . . . . . . . . . . ► ❑ 41a If the issuer has identified a hedge, check here ► ❑ and enter the following information: b Name of hedge provider ► c Type of hedge ► d Term of hedge ► 42 If the issuer has superintegrated the hedge, check box . . . . . . . . . . . . . . . . . . . . . ► ❑ 43 If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated according to the requirements under the Code and Regulations (see instructions), check box . . . . . . . . ► ❑ 44 If the issuer has established written procedures to monitor the requirements of section 148, check box . . . . . ► ❑ 45a If some portion of the proceeds was used to reimburse expenditures, check here ► ❑ and enter the amount of reimbursement . . . . . . . . . ► b Enter the date the official intent was adopted ► Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge Signature and belief, they are true, correct, and complete. I further declare that I consent to the IRS's disclosure of the issuer's return information, as necessary to and process this return, to the person that I have authorized above. Consent ' Signature of issuer's authorized representative Date ' Type or print name and title Paid Print/Type preparer's name Preparer's signature Date Check ❑ if PTIN Preparer self-employed Use Only Firm's name ► Firm's EIN ► Firm's address ► Phone no. Form 8038-G (Rev. 9-2011) Instructions for Form Department of the Treasury 8038-G ira Internal Revenue Service (Rev. September 2011) Information Return for Tax -Exempt Governmental Obligations Section references are to the Internal Revenue Code unless otherwise noted. General Instructions Purpose of Form Form 8038-G is used by issuers of tax-exempt governmental obligations to provide the IRS with the information required by section 149(e) and to monitor the requirements of sections 141 through 150. Who Must File IF the issue price THEN, for tax-exempt (line 21, column (b)) governmental is... obligations issued after December 31, 1986, issuers must file... $100,000 or more A separate Form 8038-G for each issue Less than $100,000 Form 8038-GC, Information Return for Small Tax -Exempt Governmental Bond Issues, Leases, and Installment Sales For all build America bonds and recovery zone economic development bonds use Form 8038-B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds. For tax credit bonds and specified tax credit bonds use Form 8038-TC, Information Return for Tax Credit Bonds and Specified Tax Credit Bonds. When To File File Form 8038-G on or before the 15th day of the 2nd calendar month after the close of the calendar quarter in which the bond is issued. Form 8038-G may not be filed before the issue date and must be completed based on the facts as of the issue date. Late filing. An issuer may be granted an extension of time to file Form 8038-G under Section 3 of Rev. Proc. 2002-48, 2002-37 I.R.B. 531, if it is determined that the failure to file timely is not due to willful neglect. Type or print at the top of the form "Request for Relief under section 3 of Rev. Proc. 2002-48" and attach a letter explaining why Form 8038-G was not submitted to the IRS on time. Also indicate whether the bond issue in question is under examination by the IRS. Do not submit copies of the trust indenture or other bond documents. See Where To File next. Where To File File Form 8038-G, and any attachments, with the Department of the Treasury, Internal Revenue Service Center, Ogden, UT 84201. Private delivery services. You can use certain private delivery services designated by the IRS to meet the "timely mailing as timely filing/paying" rule for tax returns and payments. These private delivery services include only the following: • DHL Express (DHL): DHL Same Day Service. • Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First. • United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A.M., UPS Worldwide Express Plus, and UPS Worldwide Express. The private delivery service can tell you how to get written proof of the mailing date. Other Forms That May Be Required For rebating arbitrage (or paying a penalty in lieu of arbitrage rebate) to the Federal government, use Form 8038-T, Arbitrage Rebate, Yield Reduction and Penalty in Lieu of Arbitrage Rebate. For private activity bonds, use Form 8038, Information Return for Tax -Exempt Private Activity Bond Issues. For build America bonds (Direct Pay), build America bonds (Tax Credit), and recovery zone economic development bonds, complete Form 8038-B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds. For qualified forestry conservation bonds, new clean renewable energy bonds, qualified energy conservation bonds, qualified zone academy bonds, qualified school construction bonds, clean renewable energy bonds, Midwestern tax credit bonds, and all other qualified tax credit bonds (except build America bonds), file Form 8038-TC, Information Return for Tax Credit Bonds and Specified Tax Credit Bonds. Rounding to Whole Dollars You may show amounts on this return as whole dollars. To do so, drop amounts less than 50 cents and increase amounts from 50 cents through 99 cents to the next higher dollar. Questions on Filing Form 8038-G For specific questions on how to file Form 8038-G send an email to the IRS at TaxExemptBondQuestions@irs.gov and put "Form 8038-G Question" in the subject line. In the email include a description of your question, a return email address, the name of a contact person, and a telephone number. Definitions Tax-exempt obligation. This is any obligation, including a bond, installment purchase agreement, or financial lease, on which the interest is excluded from income under section 103. Tax-exempt governmental obligation. A tax-exempt obligation that is not a private activity bond (see below) is a tax-exempt governmental obligation. This includes a bond issued by a qualified volunteer fire department under section 150(e). Private activity bond. This includes an obligation issued as part of an issue in which: • More than 10% of the proceeds are to be used for any private activity business use, and • More than 10% of the payment of principal or interest of the issue is either (a) secured by an interest in property to be used for a private business use (or payments for such property) or (b) to be derived from payments for property (or borrowed money) used for a private business use. It also includes a bond, the proceeds of which (a) are to be used directly or indirectly to make or finance loans (other than loans described in section 141(c)(2)) to persons other than governmental units and (b) exceeds the lesser of 5% of the proceeds or $5 million. Issue price. The issue price of obligations is generally determined under Regulations section 1.148-1(b). Thus, when issued for cash, the issue price is the first price at which a substantial amount of the obligations are sold to the public. To determine the issue price of an obligation issued for property, see sections 1273 and 1274 and the related regulations. Sep 20, 2011 Cat. No. 63774D Issue. Generally, obligations are treated as part of the same issue if they are issued by the same issuer, on the same date, and in a single transaction, or a series of related transactions. However, obligations issued during the same calendar year (a) under a loan agreement under which amounts are to be advanced periodically (a "draw -down loan") or (b) with a term not exceeding 270 days, may be treated as part of the same issue if the obligations are equally and ratably secured under a single indenture or loan agreement and are issued under a common financing arrangement (for example, under the same official statement periodically updated to reflect changing factual circumstances). Also, for obligations issued under a draw -down loan that meet the requirements of the preceding sentence, obligations issued during different calendar years may be treated as part of the same issue if all of the amounts to be advanced under the draw -down loan are reasonably expected to be advanced within 3 years of the date of issue of the first obligation. Likewise, obligations (other than private activity bonds) issued under a single agreement that is in the form of a lease or installment sale may be treated as part of the same issue if all of the property covered by that agreement is reasonably expected to be delivered within 3 years of the date of issue of the first obligation. Arbitrage rebate. Generally, interest on a state or local bond is not tax-exempt unless the issuer of the bond rebates to the United States arbitrage profits earned from investing proceeds of the bond in higher yielding nonpurpose investments. See section 148(f). Construction issue. This is an issue of tax-exempt bonds that meets both of the following conditions: 1. At least 75% of the available construction proceeds are to be used for construction expenditures with respect to property to be owned by a governmental unit or a section 501(c)(3) organization, and 2. All the bonds that are part of the issue are qualified 501(c)(3) bonds, bonds that are not private activity bonds, or private activity bonds issued to finance property to be owned by a governmental unit or a section 501(c)(3) organization. In lieu of rebating any arbitrage that may be owed to the United States, the issuer of a construction issue may make an irrevocable election to pay a penalty. The penalty is equal to 11/2% of the amount of construction proceeds that do not meet certain spending requirements. See section 148(f)(4)(C) and the Instructions for Form 8038-T. Specific Instructions Part I —Reporting Authority Amended return. An issuer may file an amended return to change or add to the information reported on a previously filed return for the same date of issue. If you are filing to correct errors or change a previously filed return, check the Amended Return box in the heading of the form. The amended return must provide all the information reported on the original return, in addition to the new or corrected information. Attach an explanation of the reason for the amended return and write across the top, "Amended Return Explanation." Failure to attach an explanation may result in a delay in processing the form. Line 1. The issuer's name is the name of the entity issuing the obligations, not the name of the entity receiving the benefit of the financing. For a lease or installment sale, the issuer is the lessee or the purchaser. Line 2. An issuer that does not have an employer identification number (EIN) should apply for one on Form SS-4, Application for Employer Identification Number. You can get this form on the IRS website at IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676). You may receive an EIN by telephone by following the instructions for Form SS-4. Line 3a. If the issuer wishes to authorize a person other than an officer or other employee of the issuer (including a legal representative or paid preparer) to communicate with the IRS and whom the IRS may contact about this return (including in writing or by telephone), enter the name of such person here. The person listed in line 3a must be an individual. Do not enter the name and title of an officer or other employee of the issuer here (use line 10a for that purpose). Note. By authorizing a person other than an authorized officer or other employee of the issuer to communicate with the IRS and whom the IRS may contact about this return, the issuer authorizes the IRS to communicate directly with the individual entered on line 3a and consents to disclose the issuer's return information to that individual, as necessary, to process this return. Lines 4 and 6. If you listed an individual on line 3a to communicate with the IRS and whom the IRS may contact about this return, enter the number and street (or P.O. box if mail is not delivered to street address), city, town, or post office, state, and ZIP code of that person. Otherwise, enter the issuer's number and street (or P.O. box if mail is not delivered to street address), city, town, or post office, state, and ZIP code. Note. The address entered on lines 4 and 6 is the address the IRS will use for all written communications regarding the processing of this return, including any notices. Line 5. This line is for IRS use only. Do not make any entries in this box. Line 7. The date of issue is generally the date on which the issuer physically exchanges the bonds that are part of the issue for the underwriter's (or other purchaser's) funds. For a lease or installment sale, enter the date interest starts to accrue in a MM/DD/YYYY format. Line 8. If there is no name of the issue, please provide other identification of the issue. Line 9. Enter the CUSIP (Committee on Uniform Securities Identification Procedures) number of the bond with the latest maturity. If the issue does not have a CUSIP number, write "None." Line 10a. Enter the name and title of the officer or other employee of the issuer whom the IRS may call for more information. If the issuer wishes to designate a person other than an officer or other employee of the issuer (including a legal representative or paid preparer) whom the IRS may call for more information about the return, enter the name, title, and telephone number of such person on lines 3a and 3b. Complete lines 10a and 10b even if you complete lines 3a and 3b. Part II —Type of Issue Elections referred to in Part II are made on the original bond documents, not on this form. Identify the type of obligations issued by entering the corresponding issue price (see Issue price under Definitions earlier). Attach a schedule listing names and EINs of organizations that are to use proceeds of these obligations, if different from those of the issuer, include a brief summary of the use and indicate whether or not such user is a governmental or nongovernmental entity. Line 18. Enter a description of the issue in the space provided. Line 19. If the obligations are short-term tax anticipation notes or warrants (TANs) or short-term revenue anticipation notes or warrants (RANs), check box 19a. If the obligations are short-term bond anticipation notes (BANs), issued with the expectation that they will be refunded with the proceeds of long-term bonds at some future date, check box 19b. Do not check both boxes. Line 20. Check this box if property other than cash is exchanged for the obligation, for example, acquiring a police car, a fire truck, or telephone equipment through a series of monthly payments. (This type of obligation is sometimes referred to as a ,'municipal lease.") Also check this box if real property is directly acquired in exchange for an obligation to make periodic payments of interest and principal. Do not check this box if the proceeds of the obligation are received in the form of cash, even if the term "lease" is used in the title of the issue. -2- Part III —Description of Obligations Line 21. For column (a), the final maturity date is the last date the issuer must redeem the entire issue. For column (b), see Issue price under Definitions earlier. For column (c), the stated redemption price at maturity of the entire issue is the sum of the stated redemption prices at maturity of each bond issued as part of the issue. For a lease or installment sale, write "N/A" in column (c). For column (d), the weighted average maturity is the sum of the products of the issue price of each maturity and the number of years to maturity (determined separately for each maturity and by taking into account mandatory redemptions), divided by the issue price of the entire issue (from line 21, column (b)). For a lease or installment sale, enter instead the total number of years the lease or installment sale will be outstanding. For column (e), the yield, as defined in section 148(h), is the discount rate that, when used to compute the present value of all payments of principal and interest to be paid on the obligation, produces an amount equal to the purchase price, including accrued interest. See Regulations section 1.148-4 for specific rules to compute the yield on an issue. If the issue is a variable rate issue, write WR" as the yield of the issue. For other than variable rate issues, carry the yield out to four decimal places (for example, 5.3125%). If the issue is a lease or installment sale, enter the effective rate of interest being paid. Part IV —Uses of Proceeds of Bond Issue For a lease or installment sale, write "N/A" in the space to the right of the title for Part IV. Line 22. Enter the amount of proceeds that will be used to pay interest from the date the bonds are dated to the date of issue. Line 24. Enter the amount of the proceeds that will be used to pay bond issuance costs, including fees for trustees and bond counsel. If no bond proceeds will be used to pay bond issuance costs, enter zero. Do not leave this line blank. Line 25. Enter the amount of the proceeds that will be used to pay fees for credit enhancement that are taken into account in determining the yield on the issue for purposes of section 148(h) (for example, bond insurance premiums and certain fees for letters of credit). Line 26. Enter the amount of proceeds that will be allocated to such a fund. Line 27. Enter the amount of the proceeds that will be used to pay principal, interest, or call premium on any other issue of bonds within 90 days of the date of issue. Line 28. Enter the amount of the proceeds that will be used to pay principal, interest, or call premium on any other issue of bonds after 90 days of the date of issue, including proceeds that will be used to fund an escrow account for this purpose. Part V—Description of Refunded Bonds Complete this part only if the bonds are to be used to refund a prior issue of tax-exempt bonds. For a lease or installment sale, write "N/A" in the space to the right of the title for Part V. Lines 31 and 32. The remaining weighted average maturity is determined without regard to the refunding. The weighted average maturity is determined in the same manner as on line 21, column (d). Line 34. If more than a single issue of bonds will be refunded, enter the date of issue of each issue. Enter the date in an MM/DD/YYYY format. Part VI —Miscellaneous Line 35. An allocation of volume cap is required if the nonqualified amount for the issue is more than $15 million but is not more than the amount that would cause the issue to be private activity bonds. Line 36. If any portion of the gross proceeds of the issue is or will be invested in a guaranteed investment contract (GIC), as defined in Regulations section 1.148-1(b), enter the amount of the gross proceeds so invested, as well as the final maturity date of the GIC and the name of the provider of such contract. Line 37. Enter the amount of the proceeds of this issue used to make a loan to another governmental unit, the interest of which is tax-exempt. Line 38. If the issue is a loan of proceeds from another tax-exempt issue, check the box and enter the date of issue, EIN, and name of issuer of the master pool obligation. Line 40. Check this box if the issue is a construction issue and an irrevocable election to pay a penalty in lieu of arbitrage rebate has been made on or before the date the bonds were issued. The penalty is payable with a Form 8038-T for each 6-month period after the date the bonds are issued. Do not make any payment of penalty in lieu of arbitrage rebate with this form. See Rev. Proc. 92-22, 1992-1 C.B. 736 for rules regarding the "election document." Line 41 a. Check this box if the issuer has identified a hedge on its books and records according to Regulations sections 1.148-4(h)(2)(viii) and 1.148-4(h)(5) that permit an issuer of tax-exempt bonds to identify a hedge for it to be included in yield calculations for computing arbitrage. Line 42. In determining if the issuer has super -integrated a hedge, apply the rules of Regulations section 1.148-4(h)(4). If the hedge is super -integrated, check the box. Line 43. If the issuer takes a "deliberate action" after the issue date that causes the conditions of the private business tests or the private loan financing test to be met, then such issue is also an issue of private activity bonds. Regulations section 1.141-2(d)(3) defines a deliberate action as any action taken by the issuer that is within its control regardless of whether there is intent to violate such tests. Regulations section 1.141-12 explains the conditions to taking remedial action that prevent an action that causes an issue to meet the private business tests or private loan financing test from being treated as a deliberate action. Check the box if the issuer has established written procedures to ensure timely remedial action for all nonqualified bonds according to Regulations section 1.141-12 or other remedial actions authorized by the Commissioner under Regulations section 1.141-12(h). Line 44. Check the box if the issuer has established written procedures to monitor compliance with the arbitrage, yield restriction, and rebate requirements of section 148. Line 45a. Check the box if some part of the proceeds was used to reimburse expenditures. Figure and then enter the amount of proceeds that are used to reimburse the issuer for amounts paid for a qualified purpose prior to the issuance of the bonds. See Regulations section 1.150-2. Line 45b. An issuer must adopt an official intent to reimburse itself for preissuance expenditures within 60 days after payment of the original expenditure unless excepted by Regulations section 1.150-2(f). Enter the date the official intent was adopted. See Regulations section 1.150-2(e) for more information about official intent. Signature and Consent An authorized representative of the issuer must sign Form 8038-G and any applicable certification. Also print the name and title of the person signing Form 8038-G. The authorized representative of the issuer signing this form must have the authority to consent to the disclosure of the issuer's return information, as necessary to process this return, to the person(s) that have been designated in Form 8038-G. Note. If the issuer in Part 1, lines 3a and 3b authorizes the IRS to communicate (including in writing and by telephone) with a person other than an officer or other employee of the issuer, by signing this form, the issuer's authorized representative consents to the disclosure of the issuer's return information, as necessary to process this return, to such person. Paid Preparer If an authorized officer of the issuer filled in this return, the paid preparer's space should remain blank. Anyone who prepares the return but does not charge the organization should not sign the return. Certain others who prepare the -3- return should not sign. For example, a regular, full-time employee of the issuer, such as a clerk, secretary, etc., should not sign. Generally, anyone who is paid to prepare a return must sign it and fill in the other blanks in the Paid Preparer Use Only area of the return. The paid preparer must: • Sign the return in the space provided for the preparer's signature (a facsimile signature is acceptable), • Enter the preparer information, and • Give a copy of the return to the issuer. Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws. You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required by section 6103. The time needed to complete and file this form varies depending on individual circumstances. The estimated average time is: Learning about the law or 2 hr., 41 min. the form ............. Preparing, copying, 3 hr., 3 min. assembling, and sending the form to the IRS ...... If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can write to the Internal Revenue Service, Tax Products Coordinating Committee, SE:W:CAR:MP:T:M:S, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send the form to this office. Instead, see Where To File. -4- Form W=9 Request for Taxpayer Give Form to the (Rev. r20eas Identification Number and Certification rend Star. not Department Department of the Treasury I send to the IRS. Internal Revenue Service 1 Name (as shown on your income tax return). Name is required on this line; do not leave this line blank. 2 Business name/disregarded entity name, if different from above N tv m to cL 3 Check appropriate box for federal tax classification; check only one of the following seven boxes: 4 Exemptions (codes apply only to c ❑ Individual/sole proprietor or ❑ C Corporation ❑ S corporation P ❑ Partnership ❑ Trust/estate certain entities, not individuals; see instructions on 3): arc single -member LLC page ®o � Limited liability company, Enter the tax classification C=C corporation, S=S corporation, P= artnershi ► ❑ tY P Y• ( P P p P) Exempt payee code (f any) � `p v Note. For a single -member LLC that is disregarded, do not check LLC; check the appropriate box in the line above for Exemption from FATCA reporting cthe tax classification of the single -member owner. code (if any) d ❑ Other (see instructions) ► (Applies to accounts maintained outside the U.S.) V w 5 Address (number, street, and apt. or suite no.) Requester's name and address (optional) U d Q 6 City, state, and ZIP code ro 7 List account number(s) here (optional) Taxpayer Identification Number (TIN) Enter your TIN in the appropriate box. The TIN provided must match the name given on line 1 to avoid Social security number backup withholding. For individuals, this is generally your social security number ( However, for resident alien, sole proprietor, or disregarded entity, see the Part I instructions on page 3. For other page ®m o entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN on page 3. or Note. If the account is in more than one name, see the instructions for line 1 and the chart on page 4 for guidelines on whose number to enter. (— number Under penalties of perjury, I certify that: 1. The number shown on this form is my correct taxpayer identification number (or I an, waiting for a number to be issued to me); and 2. 1 am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding; and 3. I am a U.S. citizen or other U.S. person (defined below); and 4. The FATCA cedes) entered on this form (if any) indicating that I am exempt from FATCA reporting is correct, Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the certification, but you must provide your correct TIN. See the instructions on page 3. Sign Here Signature of U.S. person Section references are to the Internal Revenue Code unless otherwise noted. Future developments. Information about developments affecting Form W-9 (such as legislation enacted after we release it) is at www.irs.gov/fw9. Purpose of Form An individual or entity (Form W-9 requester) who is required to file an information retum with the IRS must obtain your correct taxpayer identification number (TIN) which may be your social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN), to report on an information return the amount paid to you, or other amount reportable on an information return. Examples of information returns include, but are not limited to, the following: • Form 1099-INT (interest earned or paid) • Form 1099-DIV (dividends, including those from stocks or mutual funds) • Form 1099-MISC (various types of income, prizes, awards, or gross proceeds) • Form 1099-B (stock or mutual fund sales and certain other transactions by brokers) • Form 1099-S (proceeds from real estate transactions) • Form 1099-K (merchant card and third party network transactions) • Form 1098 (home mortgage interest), 1098-E (student loan interest), 1098-T (tuition) • Form 1099-C (canceled debt) • Form 1099-A (acquisition or abandonment of secured property) Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN, if you do not return Form W-9 to the requester with a TIN, you might be subject to backup withholding. See What is backup withholding? on page 2. By signing the filled -out form, you: 1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued), 2. Certify that you are not subject to backup withholding, or 3. Claim exemption from backup withholding if you are a U.S. exempt payee. If applicable, you are also certifying that as a U.S. person, your allocable share of any partnership income from a U.S. trade or business is not subject to the withholding tax on foreign partners' share of effectively connected income, and 4. Certify that FATCA code(s) entered on this form (if any) indicating that you are exempt from the FATCA reporting, is correct. See What is FATCA reporting? on page 2 for further information. Cat. No. 10231X Form W-9 (Rev. 12-2014) Form W-9 (Rev. 12-2014) Note. if you area U.S. person and a requester gives you a form other than Form W-9 to request your TIN, you must use the requester's form if it is substantially similar to this Form W-9. Definition of a U.S. person. For federal tax purposes, you are considered a U.S. person if you are: • An individual who is a U.S. citizen or U.S. resident alien; • A partnership, corporation, company, or association created or organized in the United States or under the laws of the United States; • An estate (other than a foreign estate); or • A domestic trust (as defined in Regulations section 301.7701-7). Special rules for partnerships. Partnerships that conduct a trade or business in the United States are generally required to pay a withholding tax under section 1446 on any foreign partners' share of effectively connected taxable income from such business. Further, in certain cases where a Form W-9 has not been received, the rules under section 1446 require a partnership to presume that a partner is a foreign person, and pay the section 1446 withholding tax. Therefore, if you are a U.S. person that is a partner in a partnership conducting a trade or business in the United States, provide Form W-9 to the partnership to establish your U.S. status and avoid section 1446 withholding on your share of partnership income. In the cases below, the following person must give Form W-9 to the partnership for purposes of establishing its U.S. status and avoiding withholding on its allocable share of net income from the partnership conducting a trade or business in the United States: • In the case of a disregarded entity with a U.S. owner, the U.S. owner of the disregarded entity and not the entity; • In the case of a grantor trust with a U.S. grantor or other U.S. owner, generally, the U.S. grantor or other U.S. owner of the grantor trust and not the trust; and • In the case of a U.S.trust (other than a grantor trust), the U.S.trust (other than a grantor trust) and not the beneficiaries of the trust. Foreign person. If you are a foreign person or the U.S. branch of a foreign bank that has elected to be treated as a U.S. person, do not use Form W-9. Instead, use the appropriate Form W-8 or Form 8233 (see Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities). Nonresident alien who becomes a resident alien. Generally, only a nonresident alien individual may use the terms of a tax treaty to reduce or eliminate U.S. tax on certain types of income. However, most tax treaties contain a provision known as a "saving clause." Exceptions specified in the saving clause may permit an exemption from tax to continue for certain types of income even after the payee has otherwise become a U.S. resident alien for tax purposes. If you are a U.S. resident alien who is relying on an exception contained in the saving clause of a tax treaty to claim an exemption from U.S. tax on certain types of income, you must attach a statement to Form W-9 that specifies the following five items: 1. The treaty country. Generally, this must be the same treaty under which you claimed exemption from tax as a nonresident alien. 2. The treaty article addressing the income. 3. The article number (or location) in the tax treaty that contains the saving use and its exceptions. 4. The type and amount of income that qualifies for the exemption from tax. 5. Sufficient facts to justify the exemption from tax under the terms of the treaty article. Example. Article 20 of the U.S.-China income tax treaty allows an exemption from tax for scholarship income received by a Chinese student temporarily present in the United States. Under U.S. law, this student will become a resident alien for tax purposes if his or her stay in the United States exceeds 5 calendar years. However, paragraph 2 of the first Protocol to the U.S.-China treaty (dated April 30, 1984) allows the provisions of Article 20 to continue to apply even after the Chinese student becomes a resident alien of the United States, A Chinese student who qualifies for this exception (under paragraph 2 of the first protocoo and is relying on this exception to claim an exemption from tax on his or her scholarship or fellowship income would attach to Form W-9 a statement that includes the information described above to support that exemption. If you are a nonresident alien or a foreign entity, give the requester the appropriate completed Form W-8 or Form 8233. Backup Withholding What is backup withholding? Persons making certain payments to you must under certain conditions withhold and pay to the IRS 28% of such payments. This is called "backup withholding." Payments that may be subject to backup withholding include interest, tax-exempt interest, dividends, broker and barter exchange transactions, rents, royalties, nonemployee pay, payments made in settlement of payment card and third party network transactions, and certain payments from fishing boat operators. Real estate transactions are not subject to backup withholding. You will not be subject to backup withholding on payments you receive if you give the requester your correct TIN, make the proper certifications, and report all your taxable interest and dividends on your tax return. Payments you receive will be subject to backup withholding if: 1. You do not furnish your TIN to the requester, 2. You do not certify your TIN when required (see the Part 11 instructions on page 3 for details), Page `2 3. The IRS tells the.requester that youu-furnished an incorrect TIN, 4. The IRS tells you that you are subject to backup withholding because you did not report all your interest and dividends on your tax return (for reportable interest and dividends only), or 5. You do not certify to the requester that you are not subject to backup withholding under 4 above (for reportable interest and dividend accounts opened after 1983 only). Certain payees and payments are exempt from backup withholding. See Exempt payee code on page 3 and the separate Instructions for the Requester of Form W-9 for more information. Also see Special rules for partnerships above. What is FATCA reporting? The Foreign Account Tax Compliance Act (FATCA) requires a participating foreign financial institution to report all United States account holders that are specified United States persons. Certain payees are exempt from FATCA reporting. See Exemption from FATCA reporting code on page 3 and the Instructions for the Requester of Form W-9 for more information. Updating Your Information You must provide updated information to any person to whom you claimed to be an exempt payee if you are no longer an exempt payee and anticipate receiving reportable payments in the future from this person. For example, you may need to provide updated information if you are a C corporation that elects to be an S corporation, or if you no longer are tax exempt. In addition, you must furnish a new Form W-9 if the name or TIN changes for the account; for example, if the grantor of a grantor trust dies. Penalties Failure to furnish TIN. If you fail to furnish your correct TIN to a requester, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. l penalty for false information with respect to withholding. If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty. Criminal penalty for falsifying information. Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. Misuse of TINS. If the requester discloses or uses TINs in violation of federal law, the requester may be subject to civil and criminal penalties. Specific Instructions Line 1 You must enter one of the following on this line; do not leave this line blank. The name should match the name on your tax return. If this Form W-9 is for a joint account, list first, and then circle, the name of the person or entity whose number you entered in Part I of Form W-9. aI Individual. Generally, enter the name shown on your tax return. If you have changed your last name without informing the Social Security Administration (SSA) of the name change, enter your first name, the last name as shown on your social security card, and your new last name. Note. ITIN applicant: Enter your individual name as it was entered on your Form W-7 application, line 1 a. This should also be the same as the name you entered on the Form 1040/1040A/1040EZ you filed with your application. b. Sole proprietor or single -member I.I.C. Enter your individual name as shown on your 1040/1040A/1040EZ on line 1. You may enter your business, trade, or "doing business as" (DBA) name on line 2. c. Partnership, LLC that is not a single -member LLC, C Corporation, or S Corporation. Enter the entity's name as shown on the entity's tax return on line 1 and any business, trade, or DBA name on line 2. d. Other entities. Enter your name as shown on required U.S. federal tax documents on line 1. This name should match the name shown on the charter or other legal document creating the entity. You may enter any business, trade, or DBA name on line 2. e. Disregarded entity. For U.S. federal tax purposes, an entity that is disregarded as an entity separate from its owner is treated as a "disregarded entity." See Regulations section 301.7701-2(c)(2)(iii). Enter the owner's name on line 1. The name of the entity entered on line 1 should never be a disregarded entity. The name on line 1 should be the name shown on the income tax return on which the income should be reported. For example, if a foreign LLC that is treated as a disregarded entity for U.S. federal tax purposes has a single owner that is a U.S. person, the U.S. owner's name is required to be provided on line 1. If the direct owner of the entity is also a disregarded entity, enter the first owner that is not disregarded for federal tax purposes. Enter the disregarded entity's name on line 2, "Business name/disregarded entity name." If the owner of the disregarded entity is a foreign person, the owner must complete an appropriate Form W-8 instead of a Form W-9. This is the case even if the foreign person has a U.S. TIN, Form W-9 (Rev. 12-2014) Line 2 _ If you have a business name, trade name, DBA name, or disregarded entity name, you may enter it on line 2. Line 3 Check the appropriate box in line 3 for the U.S. federal tax classification of the person whose name is entered on line 1. Check only one box in line 3. Limited Liability Company (LLC). If the name on line 1 is an LLC treated as a partnership for U.S. federal tax purposes, check the "Limited Liability Company" box and enter "P" in the space provided. If the LLC has filed Form 8832 or 2553 to be taxed as a corporation, check the "Limited Liability Company" box and in the space provided enter "C" for C corporation or "S" for S corporation. If it is a single -member LLC that is a disregarded entity, do not check the "Limited Liability Company" box; instead check the first box in line 3 "Individual/sole proprietor or single -member LLC." Line 4, Exemptions If you are exempt from backup withholding and/or FATCA reporting, enter in the appropriate space in line 4 any code(s) that may apply to you. Exempt payee code. • Generally, individuals (including sole proprietors) are not exempt from backup withholding. • Except as provided below, corporations are exempt from backup withholding for certain payments, including interest and dividends. o Corporations are not exempt from backup withholding for payments made in settlement of payment card or third party network transactions. • Corporations are not exempt from backup withholding with respect to attorneys' fees or gross proceeds paid to attorneys, and corporations that provide medical or health care services are not exempt with respect to payments reportable on Form 1099-MISC. The following codes identify payees that are exempt from backup withholding. Enter the appropriate code in the space in line 4. 1—An organization exempt from tax under section 501(a), any IRA, or a custodial account under section 403(b)(7) if the account satisfies the requirements of section 401(f)(2) 2—The United States or any of its agencies or instrumentalities 3—A state, the District of Columbia, a U.S. commonwealth or possession, or any of their political subdivisions or instrumentalities 4—A foreign government or any of its political subdivisions, agencies, or instrumentalities 5—A corporation 6—A dealer in securities or commodities required to register in the United States, the District of Columbia, or a U.S. commonwealth or possession 7—A futures commission merchant registered with the Commodity Futures Trading Commission 8—A real estate investment trust 9—An entity registered at all times during the tax year under the Investment Company Act of 1940 10—A common trust fund operated by a bank under section 584(a) 11—A financial institution 12—A middleman known in the investment community as a nominee or custodian 13—A trust exempt from tax under section 664 or descr bed in section 4947 The following chart shows types of payments that may be exempt from backup withholding. The chart applies to the exempt payees listed above, 1 through 13. IF the payment is for ... THEN the payment is exempt for .. . Interest and dividend payments All exempt payees except for 7 Broker transactions Exempt payees 1 through 4 and 6 through 11 and all C corporations. S corporations must not enter an exempt payee code because they are exempt only for sales of noncovered securities acquired prior to 2012. Barter exchange transactions and Exempt payees 1 through 4 patronage dividends Payments over $600 required to be Generally, exempt payees reported and direct sales over $5,0001 1 through 52 Payments made in settlement of Exempt payees 1 through 4 payment card or third party network transactions � See Form 1099-MISC, Miscellaneous Income, and its instructions. Page 3 Hoowever, the following payments made to corporation and reportable on Form 1099-MISC are not exempt from backup withholding: medical and health care payments, attorneys' fees, gross proceeds paid to an attorney reportable under section 6045(f), and payments for services paid by a federal executive agency. Exemption from FATCA reporting code. The following codes identify payees that are exempt from reporting under FATCA. These codes apply to persons submitting this form for accounts maintained outside of the United States by certain foreign financial institutions. Therefore, if you are only submitting this form for an account you hold in the United States, you may leave this field blank. Consuit with the person requesting this form if you are uncertain if the financial institution is subject to these requirements. A requester may indicate that a code is not required by providing you with a Form W-9 with "Not Applicable" (or any similar indication) written or printed on the line for a FATCA exemption code. A —An organization exempt from tax under section 501(a) or any individual retirement plan as defined in section 7701(a)(37) B—The United States or any of its agencies or instrumentalities C—A state, the District of Columbia, a U.S. commonwealth or possession, or any of their political subdivisions or instrumentalities D—A corporation the stock of which is regularly traded on one or more established securities markets, as described in Regulations section 1.1472-1(c)(1)(i) E—A corporation that is a member of the same expanded affiliated group as a corporation described in Regulations section 1.1 472-1 (c)(1)(i) F—A dealer in securities, commodities, or derivative financial instruments (including notional principal contracts, futures, forwards, and options) that is registered as such under the laws of the United States or any state G—A real estate investment trust H—A regulated investment company as defined in section 851 or an entity registered at all times during the tax year under the Investment Company Act of 1940 I —A common trust fund as defined in section 584(a) J—A bank as defined in section 581 K—A broker L—A trust exempt from tax under section 664 or described in section 4947(a)(1) M—A tax exempt trust under a section 403(b) plan or section 457(g) plan Note. You may wish to consult with the financial institution requesting this form to determine whether the FATCA code and/or exempt payee code should be completed. Line 5 Enter your address (number, street, and apartment or suite number). This is where the requester of this Form W-9 will mail your information returns. Line 6 Enter your city, state, and ZIP code. Part 1. Taxpayer Identification Number (TIN) Enter your TIN in the appropriate box. If you are a resident alien and you do not have and are not eligible to get an SSN, your TIN is your IRS individual taxpayer identification number (ITIN). Enter it in the social security number box. If you do no4 have an ITIN, see How to get a TIN below. If you are a sole proprietor and you have an EIN, you may enter either your SSN or IN. However, the IRS prefers that you use your SSN. If you are a single -member LLC that is disregarded as an entity separate from its owner (see Limited Liability Company (LLC) on this page), enter the owner's SSN (or IN, if the owner has one). Do not enter the disregarded entity's EIN. If the LLC is classified as a corporation or partnership, enter the entity's EIN. Note. See the chart on page 4 for further clarification of name and TIN combinations. How to get a TIN. If you do not have a TIN, apply for one immediately. To apply for an SSN, get Form SS-5, Application for a Social Security Card, from your local SSA office or net this form online at www.ssa.gov. You may also net this form by calling 1-800-772-1213. Use Form W-7, Application for IRS Individual Taxpayer Identification Number, to apply for an ITIN, or Form SS-4, Application for Employer Identification Number, to apply for an EIN. You can apply for an EIN online by accessing the IRS website at www.irs.gov/businesses and clicking on Employer Identification Number (EIN) under Starting a Business. You can get Forms W-7 and SS -4 from the IRS by visiting IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676), If you are asked to complete Form W-9 but do not have a TIN, apply for a TIN and write "Applied For" in the space for the TIN, sign and date the form, and give it to the requester. For interest and dividend payments, and certain payments made with respect to readily tradable instruments, generally you will have 60 days to get a TIN and give it to the requester before you are subject to backup withholding on payments. The 60-day rule does not apply to other types of payments. You will be subject to backup withholding on all such payments until you provide your TIN to the requester. Note. Entering "Applied For" means that you have already applied for a TIN or that you intend to apply for one soon. Caution: A disregarded U.S. entity that has a foreign owner must use the appropnate Form W-8. Form W-9 (Rev. 12-2014) (part II: Gertificauon To establish to the withholding agent that you are a U.S. person, or resident alien, sign Form W-9. You may be requested to sign by the withholding agent even if items 1, 4, or 5 below indicate otherwise. For a joint account, only the person whose TIN is shown in Part I should sign (when required). In the case of a disregarded entity, the person identified on line 1 must sign. Exempt payees, see Exempt payee code earlier. Signature requirements. Complete the certification as indicated in items 1 through 5 below. 1. Interest, dividend, and barter exchange accounts opened before 1984 and broker accounts considered active during 1983. You must give your correct TIN, but you do not have to sign the certification. 2. Interest, dividend, broker, and barter exchange accounts opened after 1983 and broker accounts considered inactive during 1983. You must sign the certification or backup withholding will apply. If you are subject to backup withholding and you are merely providing your correct TIN to the requester, you must cross out item 2 in the certification before signing the form. 3. Real estate transactions. You must sign the certification. You may cross out item 2 of the certification. 4. Other payments. You must give your correct TIN, but you do not have to sign the certification unless you have been notified that you have previously given an incorrect TIN. "Other payments" include payments made in the course of the requester's trade or business for rents, royalties, goods (other than bills for merchandise), medical and health care services (including payments to corporations), payments to a nonemployee for services, payments made in settlement of payment card and third party network transactions, payments to certain fishing boat crew members and fishermen, and gross proceeds paid to attorneys (including payments to corporations). 5. Mortgage interest paid by you, acquisition or abandonment of secured property, cancellation of debt, qualified tuition program payments (under section 529), IRA, Coverdell ESA, Archer MSA or HSA contributions or distributions, and pension distributions. You must give your correct TIN, but you do not have to sign the certification. What Name and Number To Give the Requester For this type of account: I Give name and SSN of: 1. Individual The individual 2. Two or more individuals point The actual owner of the account or, account) if combined funds, the first individual on the account' 3. Custodian account of a minor The minor (Uniform Gift to Minors Act) 4. a. The usual revocable savings The grantor -trustee' trust (grantor is also trustee) b. So-called trust account that is The actual owner' not a legal or valid trust under state law 5. Sole proprietorship or disregarded The owner entity owned by an individual 6. Grantor trust filing under Optional The grantor' Form 1099 Filing Method 1 (see Regulations section 1.6714(b)(2)(i) (A)) For this type of account: Give name and EIN of: 7. Disregarded entity not owned by an The owner individual 8. A valid trust, estate, or pension trust Legal entity° 9. Corporation or LLC electing The corporation corporate status on Form 8832 or Form 2553 10. Association, club, religious, The organization charitable, educational, or other tax- exempt organization 11, Partnership or multi -member LLC The partnership 12. A broker or registered nominee The broker or nominee 13, Account with the Department of The public entity Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments 14, Grantor trust filing under the Form The trust 1041 Filing Method or the Optional Form 1099 Filing Method 2 (see Regulations section 1.671-4(b)(2)() List first and circle the name of the person whose number you furnish. If only one person on a � joint account has an SSN, that person's number must be furnished. x Circle the minor's name and furnish the minor's SSN. Page 4 You roust show yourindividual name and you may also enter your business or DBA name on the "Business name/disregarded entity" name line. You may use either your SSN or EIN Of you have one), but the IRS encourages you to use your SSN. `List first and circle the name of the trust, estate, or pension trust. (Do not furnish the TIN of the personal representative or trustee unless the legal entity itself Is not designated in the account .)Also see Special rules for partnerships on page 2. •Note. Grantor also must provide a Form W-9 to trustee of trust. Note. If no name is circled when more than one name is listed, the number will be considered to be that of the first name listed. Secure Your Tax Records from Identity Theft Identity theft occurs when someone uses your personal information such as your name, SSN, or other identifying Information, without your permission, to commit fraud or other crimes. An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a refund. To reduce your risk: • Protect your SSN, • Ensure your employer is protecting your SSN, and • Be careful when choosing a tax preparer. If your tax records are affected by identity theft and you receive a notice from the IRS, respond right away to the name and phone number printed on the IRS notice or letter. If your tax records are not currently affected by identity theft but you think you are at risk due to a lost or stolen purse or wallet, questionable credit card activity or credit report, contact the IRS Identity Theft Hotline at 1-800-908-4490 or submit Form 14039, For more information, see Publication 4535, Identity Theft Prevention and Victim Assistance. Victims of identity theft who are experiencing economic harm or a system problem, or are seeking help in resolving tax problems that have not been resolved through normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can reach TAS by calling the TAS toll -free case intake line at 1-877-777-4778 orTTY/TDD 1-800-829-4059. Protect yourself from suspicious emails or phishing schemes. Phishing is the creation and use of email and websites designed to mimic legitimate business emails and websites. The most common act is sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft. The IRS does not initiate contacts with taxpayers via emails. Also, the IRS does not request personal detailed Information through email or ask taxpayers for the PIN numbers, passwords, or similar secret access information for their credit card, bank, or other financial accounts. If you receive an unsolicited email claiming to be from the IRS, forward this message to phishingQrs.gov. You may also report misuse of the IRS name, logo, or other IRS property to the Treasury Inspector General for Tax Administration (TIGTA) at 1-800-366-4484. You can forward suspicious emails to the Federal Trade Commission at: span®uce.gov or contact them at www.ftc.gov/idthett or 1-877-IDTHEFT (1-877-438-4338). Visit IRS.gov to learn more about identity theft and how to reduce your risk. Privacy Act Notice Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons (including federal agencies) who are required to file information returns with the IRS to report interest, dividends, or certain other Income paid to you; mortgage interest you paid; the acquisition or abandonment of secured property; the cancellation of debt; or contributions you made to an IRA, Archer MSA, or HSA. The person collecting this form uses the information on the form to file information returns with the IRS, reporting the above information. Routine uses of this information include giving it to the Department of Justice for civil and criminal litigation and to cities, states, the District of Columbia, and U.S. commonwealths and possessions for use in administering their laws. The information also may be disclosed to other countries under a treaty, to federal and state agencies to enforce civil and criminal laws, or to federal law enforcement and intelligence agencies to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Under section 3406, payers must generally withhold a percentage of taxable interest, dividend, and certain other payments to a payee who does not give a TIN to the payer. Certain penalties may also apply for providing false or fraudulent information. ESCROW AGREEMENT THIS ESCROW AGREEMENT ("Escrow Agreement') is made as of November 28, 2016 by and among U.S. Bancorp Government Leasing and Finance, Inc. ("Lessor'), City of Anna ("Lessee') and U.S. BANK NATIONAL ASSOCIATION, as escrow agent ("Escrow Agent'). Lessor and Lessee have heretofore entered into that certain Master Tax -Exempt Lease/Purchase Agreement dated as of November 28, 2016 (the "Master Agreement') and a Property Schedule No. 1 thereto dated November 28, 2016 (the "Schedule" and, together with the terms and conditions of the Master Agreement incorporated therein, the Agreement'). The Schedule contemplates that certain personal property described therein (the "Equipment') is to be acquired from the vendor(s) or manufacturer(s) thereof (the "Vendor'). After acceptance of the Equipment by Lessee, the Equipment is to be financed by Lessor to Lessee pursuant to the terms of the Agreement. The Master Agreement further contemplates that Lessor will deposit an amount equal to the anticipated aggregate acquisition cost of the Equipment (the "Purchase Price'), being $1,340,009.75, with Escrow Agent to be held in escrow and applied on the express terms set forth herein. Such deposit, together with all interest and other additions received with respect thereto (hereinafter the "Escrow Fund') is to be applied to pay the Vendor its invoice cost (a portion of which may, if required, be paid prior to final acceptance of the Equipment by Lessee); and, if applicable, to reimburse Lessee for progress payments already made by it to the Vendor of the Equipment. The parties desire to set forth the terms on which the Escrow Fund is to be created and to establish the rights and responsibilities of the parties hereto. Now, THEREFORE, in consideration of the sum of Ten Dollars ($10.00) in hand paid, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. Escrow Agent hereby agrees to serve as escrow agent upon the terms and conditions set forth herein. The moneys and investments held in the Escrow Fund are for the benefit of Lessee and Lessor, and such moneys, together with any income or interest earned thereon, shall be expended only as provided in this Escrow Agreement, and shall not be subject to levy or attachment or lien by or for the benefit of any creditor of either Lessee or Lessor. Lessor, Lessee and Escrow Agent intend that the Escrow Fund constitute an escrow account in which Lessee has no legal or equitable right, title or interest until satisfaction in full of all conditions contained herein for the disbursement of funds by the Escrow Agent therefrom. However, if the parties' intention that Lessee shall have no legal or equitable right, title or interest until all conditions for disbursement are satisfied in full is not respected in any legal proceeding, the parties hereto intend that Lessor have a security interest in the Escrow Fund, and such security interest is hereby granted by Lessee to secure payment of all sums due to Lessor under the Master Agreement. For such purpose, Escrow Agent hereby agrees to act as agent for Lessor in connection with the perfection of such security interest and agrees to note, or cause to be noted, on all books and records relating to the Escrow Fund, the Lessor's interest therein. 2. On such day as is determined to the mutual satisfaction of the parties (the "Closing Date'), Lessor shall deposit with Escrow Agent cash in the amount of the Purchase Price, to be held in escrow by Escrow Agent on the express terms and conditions set forth herein. On the Closing Date, Escrow Agent agrees to accept the deposit of the Purchase Price by Lessor, and further agrees to hold the amount so deposited together with all interest and other additions received with respect thereto, as the Escrow Fund hereunder, in escrow on the express terms and conditions set forth herein. 3. Escrow Agent shall at all times segregate the Escrow Fund into an account maintained for that express purpose, which shall be clearly identified on the books and records of Escrow Agent as being held in its capacity as Escrow Agent. Securities and other negotiable instruments comprising the Escrow Fund from time to time shall be held or registered in the name of Escrow Agent (or its nominee). The Escrow Fund shall not, to the extent permitted by applicable law, be subject to levy or attachment or lien by or for the benefit of any creditor of any of the parties hereto (except with respect to the security interest therein held by Lessor). 4. The cash comprising the Escrow Fund from time to time shall be invested and reinvested by Escrow Agent in one or more investments as directed by Lessee. Absent written direction from Lessee, the cash will be invested in the U.S. Bank National Association Money Market Deposit Fund. See Exhibit 1 Investment Direction Letter. Lessee represents and warrants to Escrow Agent and Lessor that the investments selected by Lessee for investment of the Escrow Fund are permitted investments for Lessee under all applicable laws. Escrow Agent will use due diligence to collect amounts payable under a check or other instrument for the payment of money comprising the Escrow Fund and shall promptly notify Lessee and Lessor in the event of dishonor of payment under any such check or other instruments. Interest or other amounts earned and received by Escrow Agent with respect to the Escrow Fund shall be deposited in and comprise a part of the Escrow Fund. Escrow Agent shall maintain accounting records sufficient to permit calculation of the income on investments and interest earned on deposit of amounts held in the Escrow Fund. The parties acknowledge that to the extent regulations of the Comptroller of Currency or other applicable regulatory entity grant a right to receive brokerage confirmations of security transactions of the escrow, the parties waive receipt of such confirmations, to the extent permitted by law. The Escrow Agent shall furnish a statement of security transactions on its regular monthly reports. Attached as Exhibit 6 is the Class Action Negative Consent Letter to be reviewed by Lessee. 5. Upon request by Lessee and Lessor, Escrow Agent shall send monthly statements of account to Lessee and Lessor, which statements shall set forth all withdrawals from and interest earnings on the Escrow Fund as well as the investments in which the Escrow Fund is invested. 6. Escrow Agent shall take the following actions with respect to the Escrow Fund: (a) Upon Escrow Agent's acceptance of the deposit of the Purchase Price, an amount equal to Escrow Agent's set-up fee, as set forth on Exhibit 2 hereto, shall be disbursed from the Escrow Fund to Escrow Agent in payment of such fee. (b) Escrow Agent shall pay costs of the Equipment upon receipt of a duly executed Requisition Request (substantially in the format of Exhibit 3) signed by Lessor and Lessee. Lessor's authorized signatures are provided in Exhibit 5. Lessee's authorized signatures will be provided in Exhibit 3 of Master Lease Purchase Agreement. Escrow Agent will use best efforts to process requests for payment within one (1) business day of receipt of requisitions received prior to 2:00 p.m. Central Time. The final Requisition shall be accompanied by a duly executed Final Acceptance Certificate form attached as Exhibit 4 hereto. (c) Upon receipt by Escrow Agent of written notice from Lessor that an Event of Default or an Event of Nonappropriation (if provided for under the Master Agreement) has occurred under the Agreement, all funds then on deposit in the Escrow Fund shall be paid to Lessor for application in accordance with the Master Agreement, and this Escrow Agreement shall terminate. (d) Upon receipt by Escrow Agent of written notice from Lessor that the purchase price of the Equipment has been paid in full, Escrow Agent shall pay the funds then on deposit in the Escrow Fund to Lessor to be applied first to the next Lease Payment due under the Master Agreement, and second, to prepayment of the principal component of Lease Payments in inverse order of maturity without premium. To the extent the Agreement is not subject to prepayment, Lessor consents to such prepayment to the extent of such prepayment amount from the Escrow Fund. Upon disbursement of all amounts in the Escrow Fund, this Escrow Agreement shall terminate. (e) This Escrow Agreement shall terminate eighteen (18) months from the date of this Escrow Agreement. It may, however, be extended by mutual consent of Lessee and Lessor in writing to Escrow Agent. All funds on deposit in the Escrow Fund at the time of termination under this paragraph, unless otherwise directed by Lessee in writing (electronic means acceptable), shall be transferred to Lessor. 7. The fees and expenses, including any legal fees, of Escrow Agent incurred in connection herewith shall be the responsibility of Lessee. The basic fees and expenses of Escrow Agent shall be as set forth on Exhibit 2 and Escrow Agent is hereby authorized to deduct such fees and expenses from the Escrow Fund as and when the same are incurred without any further authorization from Lessee or Lessor. Escrow Agent may employ legal counsel and other experts as it deems necessary for advice in connection with its obligations hereunder. Escrow Agent waives any claim against Lessor with respect to compensation hereunder. 8. Escrow Agent shall have no liability for acting upon any written instruction presented by Lessor in connection with this Escrow Agreement, which Escrow Agent in good faith believes to be genuine. Furthermore, Escrow Agent shall not be liable for any act or omission in connection with this Escrow Agreement except for its own negligence, willful misconduct or bad faith. Escrow Agent shall not be liable for any loss or diminution in value of the Escrow Fund as a result of the investments made by Escrow Agent. 9. Escrow Agent may resign at any time by giving thirty (30) days' prior written notice to Lessor and Lessee. Lessor may at any time remove Escrow Agent as Escrow Agent under this Escrow Agreement upon written notice. Such removal or resignation shall be effective on the date set forth in the applicable notice. Upon the effective date of resignation or removal, Escrow Agent will transfer the Escrow Fund to the successor Escrow Agent selected by Lessor. 10. Lessee hereby represents, covenants and warrants that pursuant to Treasury Regulations Section 1.148-7(d), the gross proceeds of the Agreement will be expended for the governmental purposes for which the Agreement was entered into, as follows: at least 15% within six months after the Commencement Date, such date being the date of deposit of funds into the Escrow Fund, at least 60% within 12 months after the Commencement Date, and 100% within 18 months after the Commencement Date. If Lessee is unable to comply with Section 1.148-7(d) of the Treasury Regulations, Lessee shall, at its sole expense and cost, compute rebatable arbitrage on the Agreement and pay rebatable arbitrage to the United States at least once every five years, and within 60 days after payment of the final rental or Lease Payment due under the Agreement. 11. In the event of any disagreement between the undersigned or any of them, and/or any other person, resulting in adverse claims and demands being made in connection with or for any moneys involved herein or affected hereby, Escrow Agent shall be entitled at its option to refuse to comply with any such claim or demand, so long as such disagreement shall continue, and in so refusing Escrow Agent may refrain from making any delivery or other disposition of any moneys involved herein or affected hereby and in so doing Escrow Agent shall not be or become liable to the undersigned or any of them or to any person or party for its failure or refusal to comply with such conflicting or adverse demands, and Escrow Agent shall be entitled to continue so to refrain and refuse so to act until: (a) the rights of the adverse claimants have been finally adjudicated in a court assuming and having jurisdiction of the parties and the moneys involved herein or affected hereby; or (b) all differences shall have been adjusted by Master Agreement and Escrow Agent shall have been notified thereof in writing signed by all of the persons interested. 12. All notices (excluding billings and communications in the ordinary course of business) hereunder shall be in writing, and shall be sufficiently given and served upon the other party if delivered (a) personally, (b) by United States registered or certified mail, return receipt requested, postage prepaid, (c) by an overnight delivery by a service such as Federal Express or Express Mail from which written confirmation of overnight delivery is available, or (d) by facsimile with a confirmation copy by regular United States mail, postage prepaid, addressed to the other party at its respective address stated below the signature of such party or at such other address as such party shall from time to time designate in writing to the other party, and shall be effective from the date of mailing. 13. This Escrow Agreement shall inure to the benefit of and shall be binding upon the parties hereto and their respective successors and assigns. No rights or obligations of Escrow Agent under this Escrow Agreement may be assigned without the prior written consent of Lessor. 14. This Escrow Agreement shall be governed by and construed in accordance with the laws in the state of the Escrow Agent's location. This Escrow Agreement constitutes the entire Agreement between the parties hereto with respect to the subject matter hereof, and no waiver, consent, modification or change of terms hereof shall bind any party unless in writing signed by all parties. 15. This Escrow Agreement and any written direction may be executed in two or more counterparts, which when so executed shall constitute one and the same agreement or direction. IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be duly executed as of the day and year first above set forth. U.S. Bancorp Government Leasing and Finance, Inc., as Lessor By: Name: Title: Address: 13010 SW 68 1h Parkway, Suite 100 Portland, OR 97223 City of Anna, as Lessee B: Name: Title: Address: PO Box776 Anna, TX 75409 U.S. BANK NATIONAL ASSOCIATION, as Escrow Agent By: Name: Title: Address: U.S. Bank National Association 950 17th Street, 12th Floor Denver, CO 80202 EXHIBIT 1 U.S. BANK NATIONAL ASSOCIATION MONEY MARKET ACCOUNT AUTHORIZATION FORM DESCRIPTION AND TERMS The U.S. Bank Money Market account is a U.S. Bank National Association ("U.S. Bank") interest -bearing money market deposit account designed to meet the needs of U.S. Bank's Corporate Trust Services Escrow Group and other Corporate Trust customers of U.S. Bank. Selection of this investment includes authorization to place funds on deposit and invest with U.S. Bank. U.S. Bank uses the daily balance method to calculate interest on this account (actual/365 or 366). This method applies a daily periodic rate to the principal balance in the account each day. Interest is accrued daily and credited monthly to the account. Interest rates are determined at U.S. Bank's discretion, and may be tiered by customer deposit amount. The owner of the account is U.S. Bank as Agent for its trust customers. U.S. Bank's trust department performs all account deposits and withdrawals. Deposit accounts are FDIC Insured per depositor, as determined under FDIC Regulations, up to applicable FDIC limits. U.S. BANK, WHEN ACTING AS AN INDENTURE TRUSTEE OR IN A SIMILAR CAPACITY, IS NOT REQUIRED TO REGISTER AS A MUNICIPAL ADVISOR WITH THE SECURITIES AND EXCHANGE COMMISSION FOR PURPOSES OF COMPLYING WITH THE DODD-FRANK WALL STREET REFORM & CONSUMER PROTECTION ACT. INVESTMENT ADVICE, IF NEEDED, SHOULD BE OBTAINED FROM YOUR FINANCIAL ADVISOR. AUTOMATIC AUTHORIZATION In the absence of specific written direction to the contrary, U.S. Bank is hereby directed to invest and reinvest proceeds and other available moneys in the U.S. Bank Money Market Account. The U.S. Bank Money Market Account is a permitted investment under the operative documents and this authorization is the permanent direction for investment of the moneys until notified in writing of alternate instructions. City of Anna Company Name Signature of Authorized Directing Party Trust Account Number — includes existing and Title/Date future sub -accounts unless otherwise directed EXHIBIT 2 Schedule of Fees for Services as Escrow Agent For City of Anna Equipment Lease Purchase Escrow CTS01010A Acceptance Fee The acceptance fee includes the administrative review of WAIVED documents, initial set-up of the account, and other reasonably required services up to and including the closing. This is a one-time, non-refundable fee, payable at closing. CTS04460 Escrow Agent Annual fee for the standard escrow agent services WAIVED associated with the administration of the account. Administration fees are payable in advance. Direct Out of Pocket Expenses Reimbursement of expenses associated At Cost with the performance of our duties, including but not limited to publications, legal counsel after the initial close, travel expenses and filing fees. Extraordinary Services Extraordinary Services are duties or responsibilities of an unusual nature, including termination, but not provided for in the governing documents or otherwise set forth in this schedule. A reasonable charge will be assessed based on the nature of the services and the responsibility involved. At our option, these charges will be billed at a flat fee or at our hourly rate then in effect. Account approval is subject to review and qualification. Fees are subject to change at our discretion and upon written notice. Fees paid in advance will not be prorated. The fees set forth above and any subsequent modifications thereof are part of your agreement. Finalization of the transaction constitutes agreement to the above fee schedule, including agreement to any subsequent changes upon proper written notice. In the event your transaction is not finalized, any related out-of-pocket expenses will be billed to you directly. Absent your written instructions to sweep or otherwise invest, all sums in your account will remain uninvested and no accrued interest or other compensation will be credited to the account. Payment of fees constitutes acceptance of the terms and conditions set forth. IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT: To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account. For a non -individual person such as a business entity, a charity, a Trust or other legal entity we will ask for documentation to verify its formation and existence as a legal entity. We may also ask to see financial statements, licenses, identification and authorization documents from individuals claiming authority to represent the entity or other relevant documentation. EXHIBIT 3 REQUISITION REQUEST The Escrow Agent is hereby requested to pay from the Escrow Fund established and maintained under that certain Escrow Agreement dated as of November 28, 2016 (the "Escrow Agreement') by and among U.S. Bancorp Government Leasing and Finance, Inc. (the "Lessor'), City of Anna (the "Lessee'), and U.S. Bank National Association (the "Escrow Agent'), the amount set forth below to the named payee(s). The amount shown is due and payable under a purchase order or contract (or has been paid by and not previously reimbursed to Lessee) with respect to equipment being financed under that certain Master Tax -Exempt Lease Purchase Agreement dated as of November 28, 2016 (the "Master Agreement') and Property Schedule No. 1 thereto dated November 28, 2016 (the "Schedule" and, together with the terms and conditions of the Master Agreement incorporated therein, the Agreement'), by and between the Lessor and the Lessee, and has not formed the basis of any prior requisition request. PAYEE AMOUNT INVOICE NO. EQUIPMENT Total requisition amount $ The undersigned, as Lessee under the Master Agreement, hereby certifies: 1. The items of the Equipment being acquired with the proceeds of this disbursement have been delivered and installed at the location(s) contemplated by the Master Agreement. The Lessee has conducted such inspection and/or testing of the Equipment being acquired with the proceeds of this disbursement as it deems necessary and appropriate, and such Equipment has been accepted by Lessee. 2. The costs of the Equipment to be paid from the proceeds of this disbursement have been properly incurred, are a proper charge against the Escrow Fund and have not been the basis of any previous disbursement. 3. No part of the disbursement requested hereby will be used to pay for materials not yet incorporated into the Equipment or for services not yet performed in connection therewith. 4. The Equipment is covered by insurance in the types and amounts required by the Agreement. 5. No Event of Default or Event of Nona ppropriation (if applicable), as each such term is defined in the Master Agreement, and no event which with the giving of notice or lapse of time, or both, would become such an Event of Default or Event of Nonappropriation has occurred and is continuing on the date hereof. 6. If Lessee paid an invoice prior to the commencement date of the Master Agreement, and is requesting reimbursement for such payment, Lessee has satisfied the requirements for reimbursement set forth in Treas. Reg. §1.150-2. Request Date: Lessor: U.S. Bancorp Government Leasing and Finance, Inc. B: Name: Title: Lessee: City of Anna Name: Title: Exhibit 4 Final Acceptance Certificate U.S. Bancorp Government Leasing and Finance, Inc. 13010 SW 68th Parkway, Suite 100 Portland, OR 97223 Re: Property Schedule No. 1 to Master Tax -Exempt Lease/Purchase Agreement between U.S. Bancorp Government Leasing and Finance, Inc. and City of Anna Ladies and Gentlemen: In accordance with the above -referenced Master Tax -Exempt Lease/Purchase Agreement (the "Master Agreement"), the undersigned ("Lessee") hereby certifies and represents to, and agrees with, U.S. Bancorp Government Leasing and Finance, Inc. ("Lessor"), as follows: (1) The Property, as such terms are defined in the above -referenced Property Schedule, has been acquired, made, delivered, installed and accepted on the date indicated below. (2) Lessee has conducted such inspection and/or testing of the Property as it deems necessary and appropriate and hereby acknowledges that it accepts the Property for all purposes. (3) No event or condition that constitutes, or with notice or lapse of time, or both, would constitute, an Event of Default or a Nonappropriation Event (as such terms are defined in the Master Agreement) exists at the date hereof. Acceptance Date: Lessee: City of Anna Name Title: Exhibit 6 Class Action Negative Consent Letter November 28, 2016 City of Anna PO Box 776 Anna, TX 75409 RE: USBGLF/City of Anna - - Class Action Litigation Claims Dear Joseph Johnson: U.S. Bank National Association ("U.S. Bank") has established its policies and procedures relative to class action litigation claims filed on behalf of its clients' accounts. This policy may impact future claims filed by U.S. Bank on behalf of the above -referenced account. Listed below are the policies regarding class action litigation claims: 1. U.S. Bank will file class action litigation claims, at no charge, on behalf of open, eligible agency or custody accounts upon receipt of proper documented authorization. This notice, with your ability to opt out as further described below, constitutes such documented authorization. 2. U.S. Bank will not file claims for agency or custody accounts that were open during the class action period but were closed prior to receipt of any notice of the class action litigation. 3. Assuming requisite information is provided by the payor to identify the applicable account, settlement proceeds of the class action litigation will be posted within a reasonable time following receipt of such proceeds to the entitled accounts that are open at such time. If entitled accounts are closed prior to distribution and receipt of settlement proceeds, they will be remitted to entitled beneficiaries or successors of the account net of any research and filing fees. Proceeds, less any research and filing fees, will be escheated if the entitled beneficiaries or successors of the account cannot be identified /located. If you wish U.S. Bank to continue to file class action litigation proofs of claim on behalf of your account, you do not need to take any further action. However, if you do not wish U.S. Bank to file class action proofs of claim on behalf of your account, you may notify us of this election by returning this letter with your signature and date provided below within 30 days or by filing a separate authorization letter with your Account Manager by the same date. The authorization and understanding contained in this communication constitutes an amendment of any applicable provisions of the account document for the above -referenced account. If you have any questions, please contact me at the below number. Sincerely, Leland Hansen Vice President 303-585-4594 ❑ No, U.S. Bank is not authorized to file class action litigation proofs of claim on behalf of the above -referenced account(s). By making this election, I acknowledge that U.S. Bank is not responsible for forwarding notices received on class action or litigation claims. ❑ Yes, U.S. Bank is authorized to file class action litigation proofs of claim on behalf of the above -referenced account(s). By making this election, I acknowledge that U.S. Bank is responsible for forwarding notices received on class action or litigation claims. Authorized Signer Date INTEROFFICE MEMORANDUM TO: PHILIP SANDERS —CITY MANAGER FROM: CLAYTON FULTON SUBJECT: AMI PLAN OF FINANCE DATE: SEPTEMBER 29, 2016 CC: JOSEPH JOHNSON, FINANCE STAFF The Public Worlcs Department received a lease purchase proposal from US Bank to finance the equipment purchase to begin the AMI conversion program. I have reviewed the proposal and consulted with our First Southwest to evaluate the optimal finance plan for the AMI project. Based upon my evaluation and the comments from First Southwest I believe it is in the best interest of the City of Anna to pursue the lease purchase proposal from US Bank. I have included a table summarizing my analysis below; however, I believe US Bank provides the best solution for the following reasons: • Lower total cost • Faster availability of fund • No additional fees • No disclosures following issuance While the average annual payment and total cost are not significantly different, I believe we should pursue savings where ever possible. Additionally, the US Bank proposal will provide access to capital in a more efficient manner and will not require additional closing costs, paying agent fees, or SEC disclosures. Some additional points to consider are the lease security and the non -appropriation and escrow requirements. If we issue a C/0 we will have a revenue and tax pledge as the security on the bond. Pursuing the lease option will result in the equipment being the security. The lease option is subject to non -appropriation; the equipment is required to be returned if the lease payment is not appropriated in the budget. Additionally, funds authorized under the lease agreement would be deposited into an interest bearing escrow account and all payment to the vendor will be made from US Bank after the City has authorized payment. US Bank FSW CO ::Rate 2.00% 1.74% PAR Amount 1,295,502 1,337,000 Annual PMT 144,224 145,028 Total Cost 11442,237 11450,280 146,735 1132 Term 10 years 10 years Time Frame 1-2 business after approval ` 75-90 Days Security Equipment Lien Tax Rate/Revenue Pledge Appropriation Yes No Lease Agreement Yes No Debt Financing No Yes Tax Exempt Yes Yes Count Against BQ Debt Yes Yes Funds to Escrow Yes No Additional Fees No Paying Agent SEC Disclosure No Yes I am also including information from an email FSW sent regarding their analysis. 1. Timing. Issuance of a C/O requires notice period of at least 31 days between publication of a notice of intent and issuance, plus closing will occur between 20 and 30 days after approval of C/O issuance by Council. I'd say this process would take 75 to 90 days from start to finish. You can always do a reimbursement resolution and use cash on hand to manage the timing issue. The leasing option is a more straight forward process without notice period and without Attorney General review process. 2. Security pledge. The C/O would be secured by the City's I&S tax rate and net revenue from the W&S system. As with all other C/Os, the legality of the obligation and pledge will be reviewed by the Attorney General. The fact that a C/O carries an I&S tax pledge allows the City to access lower interest cost than the leasing option. The leasing option is an appropriation pledge and not secured by the City's I&S tax or the City's net revenues from the W&S system in a way a C/O would be; repayment becomes part of the appropriation budget process, there's no obligation to levy a tax sufficient to repay or to impose W&S rates and charges that produce enough revenues to repay; moreover, the lease carries a lien on the equipment. 3. Amount of debt. The C/O is a higher liability with lower interest cost vs the lease which is less debt, but at a higher interest cost. C/O debt is accounted for in bond rating analysis as "parity" debt with existing obligations. Lease debt is not "parity" due to the appropriation nature of it. We don't expect either one to carry negative implications as it relates to rating metrics; it's a small obligation. 4. Additional charges. The C/O may come with additional annual paying agent fees ($400- $500 per year); insurance and others are not imposed by the lender. The lease will come with taxes and insurance as required by US Bank. 2 I spoke with US Bank and they have assured ine this is tax exempt, I atn still waiting on the answer regarding insurance; however, I assume this is equipment the will want to insure regardless of the funding mechanism. 5. Tax-exempt obligation. Both count against the City's Bank Qualified limit of $10,000,000 per calendar year. Probably no big deal since the City is not planning any big issuance this year. 3