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HomeMy WebLinkAboutLease Purchase AgreementCORPORATION MUNICIPAL LEASE-PURCHASE AGREEMENT DATED May 2, 2017 COUNTY OF KITTITAS "YOUR PUBLIC FINANCE PARTNER" 345 Miron Drive Southlake, TX 76092 800.883.1199 www.goV(~p.com May 17, 2017 345 MIRON DRIVE SOUTHLAKE, TEXAS 76092 817 4215400 Jerald V . Pettit, County Auditor County of Kittitas 205 West 5th Avenue, Suite 105 Ellensburg, WA 98926 WWW.GOVCAP.COM RE: Municipal Lease-Purchase Agreement No.7768, dated as of May 2, 2017, by and between the County of Kittitas and Government Capital Corporation . Dear Jerald V . Pettit: Please be advised that Government Capital Corporation ("GCC") has assigned all its right, title and interest in the Agreement, and in the equipment leased thereunder, and the right to receive payments thereunder to Central Trust Bank. As of the date above, funds have been made available for disbursement or may have been disbursed. Please contact your GCC representative with any questions you may have. Notification Sign all three (3) letters. Return two (2) in the envelope provided and keep one (1) for your records. The purpose of this letter is to inform you that your lease agreement has been placed with Central Trust Bank . Exe cuted Lease Agreement This is your copy for your records. Insurance Update your insurance coverage to include Central Trust Bank as Loss Payee. Send, or instruct the insurance company to forward a Certificate of Insurance showing Central Trust Bank as Loss Payee, to my attention at our Corporate Office. Payments Payments 2 through 5, due under the Agreement should be made to Central Trust Bank, 111 E. Miller St., Jefferson City, MO, 65101. Additi.onal payment information is in the Lease Agreement, Exhibit B. ~k-' An n Schmidt Post-Closing Coordinator ACKNOWLEDGED AND ACCEPTED: COUNTY OF KITTITAS Signed By:-,~:L£...:LC::""!"!'~_~;;,.a;~~ ____ _ J MUNICIPAL LEASE-PURCHASE AGREEMENT THIS MUNICIPAL LEASE-PURCHASE AGREEMENT No.7768 (hereafter referred to as "Agreement") dated as of May 2, 2017, by and between Government Capital Corporation, a Texas corporation (herein referred to as "Lessor"), and County of Kittitas, a political subdivision or agency of the State of Washington (hereinafter referred to as "Lessee"). WITNESSETH: In consideration of the mutual covenants and conditions hereinafter set forth, the parties hereto agree as follows: 1. Term and Payments. Lessor hereby leases to Lessee and Lessee hereby leases from Lessor the property described in Exhibit A hereto (hereinrlftf'r, with nil rp.rlnr.p.ment parts, substitutions, proceeds, increases, additions, accessions, repairs and accessories incorporated therein or affixed thereto, referred to as the "Property") for the amounts to be paid in the sums (the "Lease Payments") from any and all legally available funds and on the dates (the "Lease Payment Dates") set forth in Exhibit B hereto. The obligation of the Lessee to make the Lease Payments called for in Exhibit B hereto shall be absolute and unconditional in all events and shall not be subject to any set-off, defense, counterclaim or recoupment for any reason. The term of the lease hereunder shall commence upon the dated date of the Exhibit B and shall continue until the end of the Lessee's current fiscal period and thereafter for such additional fiscal periods as are necessary to complete the anticipated total lease term as set forth in Exhibit B, unless earlier terminated as provided herein. 2. Section Deleted. 3. Taxes. In addition to the Lease Payments to be made pursuant to Section 1 hereof, Lessee agrees to pay Lessor, as additional rent, on demand, an amount equal to all licenses, assessments, sales, use, real or personal property, gross receipts or other taxes, levies, imposts, duties or charges, if any, together with any penalties, fines, or interest thereon imposed against or on Lessor, Lessee or the Property by any governmental authority upon or with respect to the Property or the purchase, ownership, rental, possession, operation, return or sale of, or receipt of payments for, the Property, except any Federal or state income taxes, if any, payable by Lessor. Lessee may contest any such taxes prior to payment provided such contest does not involve any risk of sale, forfeiture or loss of the Property or any interest therein. 4. Lessee's Covenants and Representations. Lessee covenants and represents as follows: (a) Lessee represents, and will provide an opinion of its counsel to the effect that, it has full power and authority to enter into this Agreement which has been duly authorized, executed, and delivered by Lessee and is a valid and binding obligation of Lessee enforceable in accordance with its terms, and all requirements for execution, delivery and performance of this Agreement have been, or will be, complied with in a timely manner; (b) All Payments hereunder have been, and will be, duly authorized and paid when due out of funds then on hand and legally available for such purposes; (c) There are no pending or threatened lawsuits or administrative or other proceedings contesting the authority for, authorization of performance of, or expenditure of funds pursuant to, this Agreement; (d) Information supplied and statements made by Lessee in any financial statement or current budget prior to or contemporaneously with the Agreement are true and correct; (e) Lessee has an immediate need for, and expects to make immediate use of, substantially all the Property, which need is not temporary or expected to diminish in the foreseeable future; (f) There are no circumstances presently affecting the Lessee that could reasonably be expected to alter its foreseeable need for the Property or adversely affect its ability or willingness to budget funds for the payment of sums due hereunder; (g) No lease, rental agreement, lease-purchase agreement, payment agreement or contract for purchase to which Lessee has been a party at any time during the past ten (10) years has been terminated by Lessee as a result of insufficient funds being appropriated in any Fiscal Year. No event has occurred which would constitute an event of default under any debt, revenue bond or obligation which Lessee has issued during the past ten (10) years. (h) Lessee will pay the Lease Payment Due by check, wire transfer, or ACH only. (i) The parties assume that Lessor can exclude the interest component of the Lease Payments from Federal gross income. Lessee covenants and agrees that it will (i) if the transaction is escrow funded, rebate an amount equal to excess earnings on the Escrow Fund to the Federal Government if required by, and in accordance with, Section 148(f) of the Code, and make the annual determinations and maintain the records required by regulations applicable thereto; (ii) use a book entry system to register the owner of this Agreement so as to meet the applicable requirements of Section 149(a)(3) of the Code; (iii) timely file a Form 8038-G or, if the invoice price of the Property is less than $100,000, a form 8038(GC) with the Internal Revenue Service in accordance with Section 149(e) of the Code; (iv) not permit the Property to be directly or indirectly used for a private business use within the meaning of Section 141 of the Code; and (v) comply with all provisions and regulations applicable to excluding interest from Federal gross income pursuant to Section 103 of the Code. S. Use and Licenses. Lessee shall pay and discharge all operating expenses and shall cause the Property to be operated by competent persons only. Lessee shall use the Property only for its proper purposes and will not install, use, operate or maintain the Property improperly, carelessly, or in violation of any applicable law, ordinance, rule or regulation of any governmental authority, or in a manner contrary to the nature of the Property or the use contemplated by its manufacturer. Lessee shall keep the property at the location stated on the Certificate of Acceptance executed by Lessee upon delivery of the Property until Lessor, in writing, permits its removal, and the Property shall be used solely in the conduct of the Lessee's operations. Lessee shall obtain, at its expense, all registrations, permits and licenses, if any, required by law for the installation and operation of the Property . Any license plates used on the Property shall be issued in the name of the Lessee. If a certificate of title is issuable with respect to the Property. it shall be delivered to the Lessor showing the interest of the Lessor. GOVERNMENT CAPITAL MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 1 6. Maintenance. Lessor shall not be obligated to make any repairs or replacements. At its own expense, Lessee shall service, repair and maintain the Property in as good condition, repair, appearance and working order as when delivered to Lessee hereunder, ordinary wear and tear from proper use alone excepted, and shall replace any and all parts thereof which may from time to time become worn out, lost, stolen, destroyed, or damaged beyond repair or rendered unfit for intended use, for any reason whatsoever, all of which replacements shall be free and clear of all liens, encumbrances and claims of others and shall become part of the Property and subject to this Agreement. Lessor may, at its option, discharge such costs, expenses and insurance premiums necessary for the repair, maintenance and preservation of the Property, and all sums so expended shall be due from Lessee in addition to rental payments hereunder. 7. Alterations. (a) Lessee may, at its own expense, install or place in or on, or attach or affix to, the Property such equipment or accessories as may be necessary or convenient to liSP thp Proflerty for its intended purposes provided that such equipment or accessories do not impair the value or utility of the Property. All such equipment and accessories shall be removed by Lessee upon termination of this Agreement, provided that any resulting damage shall be repaired at Lessee's expense. Any such equipment or accessories not removed shall become the property of Lessor. (b) Without the written consent of Lessor, Lessee shall not make any other alterations, modifications or improvements to the Property except as required or permitted hereunder. Any other alterations, modifications or improvements to the Property shall immediately become part of the Property, subject to the provisions hereof. Without the prior written consent of Lessor, Lessee shall not affix or attach any of the Property to any real property. The Property shall remain personal property regardless of whether it becomes affixed or attached to real property or permanently rests upon any real property or any improvement thereon. 8. Liens. Lessee shall not directly or indirectly create, incur, assume or suffer to exist any mortgage, security interest, pledge, lien, charge, encumbrance or claim on or with respect to the Property, title thereto or any interest therein, except the respective rights of Lessor and Lessee hereunder. 9. Damage to or Destruction of Property. Lessee shall bear the entire risk of loss, damage, theft or destruction of the Property from any and every cause whatsoever, and no loss, damage, destruction or other event shall release Lessee from the obligation to pay the full amount of the rental payments or from any other obligation under this Agreement. In the event of damage to any item of the Property, Lessee will immediately place the same in good repair, with the proceeds of any insurance recovery applied to the cost of such repair. If Lessor determines that any item of Property is lost, stolen, destroyed or damaged beyond repair, Lessee, at the option of Lessor, will either (a) replace the same with like property in good repair or (b) on the next Lease Payment Date, pay Lessor (i) all amounts then owed by Lessee to Lessor under this Agreement, including the Lease Payment due on such date, and (ii) an amount equal to the applicable Option to Purchase Value set forth in Exhibit B. 10. Insurance. Lessee shall either be self-insured with regard to the Property or shall purchase and maintain insurance with regard to the Property. Lessee shall indicate on each Certificate of Acceptance executed in relation to this Agreement its election to be self-insured or company insured with regard to the Property listed on that Certificate of Acceptance. Whether Lessee is self-insured or company insured, Lessee shall, for the term of this Agreement, at its own expense, provide comprehensive liability insurance with respect to the Property, insuring against such risks, and such amounts as are customary for lessees of property of a character similar to the Property. In addition, Lessee shall, for the term of this Agreement, at its own expense, provide casualty insurance with respect to the Property, insuring against customary risks, coverage at all times not less than the amount of the unpaid principal portion of the Lease Payments required to be made pursuant to Section 1 as of the last preceding Payment Date specified in Exhibit B on which a Lease Payment was made. If insurance policies are provided with respect to the Property, all insurance policies shall be with insurers authorized to do business in the State where the Property is located and shall name both Lessor and Lessee as insureds as their respective interest may appear. Insurance proceeds from casualty losses shall be payable solely to the Lessor, subject to the provisions of Section 9 . Lessee shall, upon request, deliver to Lessor evidence of the required coverages together with premium receipts, and each insurer shall agree to give Lessor written notice of non-payment of any premium due and ten (10) days notice prior to cancellation or alteration of any such policy. Lessee shall also carry and require any other person or entity working on, in or about the Property to carry workmen's compensation insurance covering employees on, in or about the Property. In the event Lessee fails, for any reason, to comply with the requirements of this Section, Lessee shall indemnify, save harmless and, at Lessee's sole expense, defend Lessor and its agents, employees, officers and directors and the Property against all risk of loss not covered by insurance. 11. Lessee Negligence. Lessee assumes all risks and liabilities, whether or not covered by insurance, for loss or damage to the Property and for injury to or death of any person or damage to any property, whether such injury or death be with respect to agents or employees of Lessee or of third parties, and whether such property damage be to Lessee's property or the property of others, which is proximately caused by the negligent conduct of Lessee, its officers, employees and agents. Lessee hereby assumes responsibility for and agrees to reimburse Lessor for all liabilities, obligations, losses, damages, penalties, claims, actions, costs and expenses (including reasonable attorney's fees) of whatsoever kind and nature, imposed on, incurred by or asserted against Lessor that in any way relate to or arise out of a claim, suit or proceeding based in whole or in part upon the negligent conduct of Lessee, its officers, employees and agents, to the maximum extent permitted by law. 12. No Warranty. ALL WARRANTIES, PROMISES AND SERVICE AGREEMENTS, IF ANY, RELATING TO THE PROPERTY THAT THE MANUFACTURERS OR THE PARTY WHO SUPPLIED THE PROPERTY TO LESSOR (THE "VENDOR") HAVE MADE TO LESSOR IN CONNECTION WITH OR AS PART OF THE CONTRACT BY WHICH LESSOR ACQUIRED THE PROPERTY ARE HEREBY ASSIGNED TO LESSEE. Lessee may communicate with Vendor and receive an accurate and complete statement of all such warranties, promises and service agreements, if any. All claims or actions on any warranty so assigned shall be made or prosecuted by Lessee, at its sole expense, upon prior written notice to Lessor. Lessor may, but shall have no obligation whatsoever to participate in such claim or action on such warranty, at Lessor's expense. Any recovery under such a warranty shall be made payable jointly to Lessee and Lessor. Lessee acknowledges that Lessee has selected the Vendor and that Lessee has directed Lessor to acquire the Property from Vendor in connection with this Agreement. Lessee further acknowledges that this Agreement is a "Finance Lease" within the meaning of the Uniform Commercial Code and that Lessee is entitled to the Vendor's warranties and promises described above, if any. LESSOR HAS MADE AND MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AND ASSUMES NO OBLIGATION WITH RESPECT TO THE TITLE, MERCHANTABILITY, CONDITION, QUALITY OR FITNESS OF THE PROPERTY DESCRIBED IN EXHIBIT A FOR ANY PARTICULAR PURPOSE OR THE CONFORMITY OF THE PROPERTY TO ANY SPECIFICATION OR PURCHASE ORDER, OR AS TO THE PROPERTY'S DESIGN, DELIVERY, INSTALLATION OR OPERATION. All such risks shall be borne by Lessee without in any way MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 2 excusing Lessee from its obligations under this Agreement, and Lessor shall not be liable to Lessee for any damages on account of such risks. 13. Option to Purchase. Provided Lessee has complied with the terms and conditions of this Agreement, Lessee shall have the option to purchase not less than all of the Property which is then subject to this Agreement, "as is" at the payment date, for the Option to Purchase Values set forth in Exhibit B by giving written notice to Lessor not less than sixty (60) days prior to the date specified in Exhibit B for the exercise of such option; provided that upon Lessee's timely payment of all Lease Payments specified in Exhibit B, Lessee shall be deemed to have properly exercised its option to purchase the Property and shall be deemed to have acquired all of Lessor's right, title and interest in and to the Property, free of any lien, encumbrance or security interest except such liens, encumbrances or security interest as may be created, or permitted and not discharged, by Lessee but without other warranties. Payment of the applicable Option to Purchase Value shall occur on the applicable Lease Payment Date specified in Exhibit B hereto, nt whir:h timp. I p.ssor shnll, IJnlp.ss not rp.qlJirp.d hp.reundp.r, dp.liver to Lessp.p. a quitclaim hill of si'llp. transfp.rring Lessor's interest in the Property to Lessee free from any lien, encumbrance or security interest except such as may be created, or permitted and not discharged, by Lessee but without other warranties. Upon Lessee's actual or constructive payment of the Option to Purchase Value and Lessor's actual or constructive delivery of a quitclaim bill of sale covering the Property, this Agreement shall terminate except as to obligations or liabilities accruing hereunder prior to such termination. 14. Default and Lessor's Remedies. (a) The occurrence of one or more of the following events shall constitute an Event of Default, whether occurring voluntarily or involuntarily, by operation of law or pursuant to any order of any court or governmental agency: (1) After written notice of missed payment and ten (10) day cure period, Lessee fails to make any payment hereunder when due; (2) Lessee fails to comply with any other covenant, condition or agreement of Lessee hereunder for a period of the ten (10) days after notice thereof; (3) Any representation or warranty made by Lessee hereunder shall be untrue in any material respect as of the date made; (4) Lessee makes, permits or suffers any unauthorized assignment, transfer or other disposition of this Agreement or any interest herein, or any part of the Property or any interest therein; or (5) Lessee becomes insolvent; or admits in writing its inability to pay its debts as they mature; or applies for, consents to or acquiesces in the appointment of a trustee, receiver or custodian for the Lessee or a substantial part of its property; or, in the absence of such application, consent or acquiescence, a trustee, receiver or custodian is appointed for Lessee or a substantial part of its property and is not discharged within sixty (60) days; or any bankruptcy, reorganization, debt arrangement, moratorium, or any proceeding under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding is instituted by or against Lessee and, if instituted against Lessee, is consented to or acquiesced in by Lessee or is not dismissed within sixty (60) days. (b) Upon the occurrence of any Event of Default specified herein, Lessor may, at its sole discretion, exercise any or all of the following remedies: (1) Enforce this Agreement by appropriate action to collect amounts due or to become due hereunder, by acceleration of otherwise, or to cause Lessee to perform its other obligations hereunder in which event Lessee shall be liable for all costs and expenses incurred by Lessor; (2) Take possession of the Property, without demand or notice and without court order or any process of law, and remove and relet the same for Lessee's account, in which event Lessee waives any and all damages resulting there from and shall be liable for all costs and expenses incurred by Lessor in connection therewith and the difference, if any, between the amounts to be paid pursuant to Section 1 hereof and the amounts received and to be received by Lessor in connection with any such reletting; (3) Terminate this Agreement and repossess the Property, in which event Lessee shall be liable for any amounts payable hereunder through the date of such termination and all costs and expenses incurred by Lessor in connection therewith; (4) Sell the Property or any portion thereof for Lessor's account at public or private sale, for cash or credit, without demand on notice to Lessee of Lessor's intention to do so, or relet the Property for a term and a rental which may be equal to, greater than or less than the rental and term provided herein. If the proceeds from any such sale or rental payments received under a new agreement made for the periods prior to the expiration of this Agreement are less than the sum of (i) the costs of such repossession, sale, relocation, storage, reconditioning, reletting and reinstallation (including but not limited to reasonable attorneys' fees), (ii) the unpaid principal balance derived from Exhibit B as of the last preceding Lease Payment Date specified in Exhibit B, and (iii) any past due amounts hereunder (plus interest on such unpaid principal balance at the rate specified in Section 19 hereof, prorated to the date of such sale), all of which shall be paid to Lessor, Lessor shall retain all such proceeds and Lessee shall remain liable for any deficiency; or (5) Pursue and exercise any other remedy available at law or in equity, in which event Lessee shall be liable for any and all costs and expenses incurred by Lessor in connection therewith. "Costs and expenses", as that term is used in this Section 14, shall mean, to the extent allowed by law: (i) reasonable attorneys' fees if this Agreement is referred for collection to an attorney not a salaried employee of Lessor or the holder of this Agreement; (ii) court costs and disbursements including such costs in the event of any action necessary to secure possession of the Property; and (iii) actual and reasonable out-of-pocket expenses incurred in connection with any repossession or foreclosure, including costs of storing, reconditioning and reselling the Property, subject to the standards of good faith and commercial reasonableness set by the applicable Uniform Commercial Code. Lessee waives all rights under all exemption laws. (6) Under no circumstances shall Lessee be liable under this subsection 14 (b) for any amount in excess of the sum appropriated pursuant to Section 1 hereof for the previous and current fiscal years, less all amounts previously due and paid during such previous and current fiscal years from amounts so appropriated. MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 3 15. Termination. Unless Lessee has properly exercised its option to purchase pursuant to Section 13 hereof, lessee shall, upon the expiration of the term of this Agreement or any earlier termination hereof pursuant to the terms of this Agreement, deliver the Property to Lessor unencumbered and in at least as good condition and repair as when delivered to Lessee, ordinary wear and tear resulting from proper use alone excepted, by loading the Property, at Lessee's sole expense, on such carrier, or delivering the Property to such location, as Lessor shall provide or designate at or within a reasonable distance from the general location of the Property. If Lessee fails to deliver the Property to Lessor, as provided in this Section 15, on or before the date of termination of this Agreement, Lessee shall pay to Lessor upon demand, for the hold-over period, a portion of the total payment for the applicable period as set forth in Exhibit B prorated from the date of termination of this Agreement to the date Lessee either redelivers the Property to Lessor or Lessor repossesses the Property. Lessee hereby waives any right which it now has or which might be acquired or conferred upon it by any law or order of any court or other qovernmental authority to terminate this Agreement or its obligations hereunder, except in accordance with the express provisions hereof. 16. Assignment. Without Lessor's prior written consent, Lessee will not either (i) assign, transfer, pledge, hypothecate, grant any security interest in or otherwise dispose of this Agreement or the Property or any interest in this Agreement or the Property; or (ii) sublet or lend the Property or permit it to be used by anyone other than Lessee or Lessee's employees. Lessor may assign its rights, title and interest in and to this Agreement, the Property and any other documents executed with respect to this Agreement and/or grant or assign a security interest in this Agreement and the Property, in whole or in part. Any such assignees shall have all of the rights of Lessor under this Agreement. Subject to the foregoing, this Agreement inures to the benefit of and is binding upon the heirs, executors, administrators, successors and assigns of the parties hereto. No assignment or reassignment of any of Lessor's rights, title or interest in this Agreement or the Property shall be effective with regard to Lessee unless and until Lessee shall have received a copy of the document by which the assignment or reassignment is made, disclosing the name and address of such assignee. No further action will be required by Lessor or by Lessee to evidence the assignment. During the term of this Agreement, Lessee shall keep a complete and accurate record of all such assignments in form necessary to comply with the United States Internal Revenue Code of 1986, Section 149 (a), and the regulations, proposed or existing, from time to time promulgated thereunder. 17. Personal Property. The Property is and shall at all times be and remain personal property. 18. Title. Upon acceptance of the Property by Lessee hereunder, Lessee shall have title to the Property during the term of this Agreement; however, in the event of an Event of Default hereunder and for so long as such Event of Default is continuing. 19. lessor's Right to Perform for lessee. If Lessee fails to make any payment or perform or comply with any of its covenants or obligations hereunder, Lessor may, but shall not be required to, make such payment or perform or comply with such covenants and obligations on behalf of Lessee, and the amount of any such payment and the expenses (including but not limited to reasonable attorneys' fees) incurred by Lessor in performing or complying with such covenants and obligations, as the case may be, together with interest thereon at the highest lawful rate, shall be payable by Lessee upon demand. 20. Interest on Default. If Lessee fails to pay any Lease Payment specified in Section 1 hereof within ten (10) days after the due date thereof, Lessee shall pay to Lessor interest on such delinquent payment from the due date until paid at the highest lawful rate. 21. Notices. Any notices to be given or to be served upon any party hereto in connection with this Agreement must be in writing and may be given by certified or registered mail, and shall be deemed to have been given and received forty-eight (48) hours after a registered or certified letter containing such notice, postage prepaid, is deposited in the United States mail, and if given otherwise shall be deemed to have been given when delivered to and received by the party to whom it is addressed. Such notice shall be given to the parties at their respective addresses designated on the signature page of this Agreement or at such other address as either party may hereafter designate. 22. Security Interest. As security for Lessee's covenants and obligations hereunder, Lessee hereby grants to Lessor, and its successors, a security interest in the Property, all accessions thereto and proceeds therefrom, and, in addition to Lessor's rights hereunder, all of the rights and benefits of a secured party under the Uniform Commercial Code as in effect from time to time hereafter in the State in which the Property is located or any other State which may have jurisdiction over the Property. Lessee agrees to execute, acknowledge and deliver to Lessor in recordable form upon request financing statements or any other instruments with respect to the Property or this Agreement considered necessary or desirable by Lessor to perfect and continue the security interest granted herein in accordance with the laws of the applicable jurisdiction. Lessee hereby authorizes Lessor or its agent/assigns to sign and execute on its behalf, any and all necessary UCC-1 forms to perfect the Purchase Money Security interest herein granted to Lessor . 23. Tax Exemption. Lessee certifies that it does reasonably anticipate that not more than $10,000,000 of "qualified tax-exempt obligations" as that term is defined in Section 265 (b) 3 (D) of the Internal Revenue Code of 1986 ("the Code"), will be issued by it and any subordinate entities during the current calendar year . Further, Lessee designates this issue as comprising a portion of the $10 million in aggregate issues to be designated as "qualified tax exempt obligations" eligible for the exception contained in Section 265 (b) 3 (D) of the Code allowing for an exception to the general rule of the Code which provides for a total disallowance of a deduction for interest expense allocable to the carrying of tax exempt obligations. 24. Continuing Disclosure. Specifically and without limitation, Lessee agrees to provide audited financial statements, prepared by a certified public accountant not later than six (6) months after and as of the end of each fiscal year. Periodic financial statement shall include a combined balance sheet as of the end of each such period, and a combined statement of revenues, expenditures and changes in fund balances, from the beginning of the then fiscal year to the end of such period certified as correct by one of Lessee's authorized agents. If Lessee has subsidiaries, the financial statements required will be provided on a consolidated and consolidation basis. 25. Miscellaneous. (a) Lessee shall, whenever requested, advise Lessor of the exact location and condition of the Property and shall give the Lessor immediate notice of any attachment or other judicial process affecting the Property, and indemnify and save Lessor harmless from any loss or damage caused thereby. Lessor may, for the purpose of inspection at all reasonable times enter upon any job, building or place where the Property and the books and records of the Lessee with respect thereto are located. MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 4 (b) If Lessor either (i) receives notice, in any form, from the Internal Revenue Service; or (ii) reasonably determines, based on an opinion of independent tax counsel selected by Lessor and approved by Lessee, which approval Lessee shall not unreasonably withhold; that Lessor may not exclude any interest paid hereunder from Federal gross income because Lessee breached a covenant contained herein, then Lessee shall pay to Lessor, within thirty (30) days after Lessor notifies Lessee of such determination, an amount which, with respect to rental payments previously paid and taking into account all penalties, fines, interest and additions to tax (including all federal, state and local taxes imposed on the interest component of all Lease Payments due through the date of such event), will restore to Lessor its after-tax yield (assuming tax at the highest marginal tax rate and taking into account the time of receipt of payments and reinvestment at the after-tax yield rate) on the transaction evidenced by this Agreement through the date of such payment. Additionally, Lessee agrees that upon the occurrence of such an event, it shall pay as additional rent to Lessor on each succeeding Lease Payment due date such amount as will maintain such after-tax yield to Lessor. (e) Time is of the essence. No covenant or obligations hereunder to be performed by Lessee may be waived except by the written consent of Lessor, and a waiver of any such covenant or obligation or a forbearance to invoke any remedy on any occasion shall not constitute or be treated as a waiver of such covenant or obligation as to any other occasion and shall not preclude Lessor from invoking such remedy at any later time prior to Lessee's cure of the condition giving rise to such remedy. Lessor's rights hereunder are cumulative and not alternative. (d) This Agreement shall be construed in accordance with, and governed by, the laws of the State in which the Property is located. (e) This Agreement constitutes the entire agreement between the parties and shall not be modified, waived, discharged, terminated, amended, altered or changed in any respect except by a written document Signed by both Lessor and Lessee. (f) Any term or provision of this Agreement found to be prohibited by law or unenforceable shall be ineffective to the extent of such prohibition or unenforceability without, to the extent reasonably possible, invalidating the remainder of this Agreement. (g) The Lessor hereunder shall have the right at any time or times, by notice to Lessee, to deSignate or appoint any person or entity to act as agent or trustee for Lessor for any purposes hereunder. (h) All transportation charges shall be borne by Lessee. Lessee will immediately notify Lessor of any change occurring in or to the Property, of a change in Lessee's address, or in any fact or circumstance warranted or represented by Lessee to Lessor, or if any Event of Default occurs. (i) Use of the neuter gender herein is for purposes of convenience only and shall be deemed to mean and include the masculine or feminine gender whenever and wherever appropriate. (j) The captions set forth herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. (k) Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective heirs, executors, administrators, legal representatives, successors and assigns, where permitted by this Agreement. [Signature Page follows] MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 5 t 2.....ff.... IN WITNESS WHEREOF, the parties h e executed this Agreement as of the ~ day of nI !¢i.( KeIth M\IIer Director of __ ~~~ ______ ~~r-______ ~O~e~~ons MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 6 in the year 2017. EXHIBIT A DESCRIPTION OF PROPERTY MUNICIPAL LEASE-PURCHASE AGREEMENT NO.7768 (THE "AGREEMENT") BY AND BETWEEN Lessor, Government Capital Corporation and Lessee, County of Kittitas Dated as of May 2, 2017 QTY DESCRIPTION Two (2) Two (2) Two (2) Two (2) Two (2) Six (6) Thirty (30) One (1) One (1) One (1) One (1) Two (2) Two (2) One (1) One (1) One (1) One (1) One (1) One (1) One (1) Election Equipment Verity Touch Writer w/Access Verity Accessible Booth Okidata B4310 Printer Toner Cartridge, Okidata B4310, Black Printer Stand Verity Key -Electronic Security Token vOrive -Flash memory card/audio card for use with Verity devices Battery charger, 1 Bay -1-bay charger for verity voting device battery Verity Build -Verity build software license Verity Central -Verity Central (Server) software license Verity Count -Verity Count software license Verity Workstation -Workstation for verity software 23" Flat Panel monitor Ethernet Switch, 8 port Verity headset Canon OR-G1130 Central Scanner Okidata C831 Printer Toner Cartridge, Okidata C831, Black Okidata B4310 Printer Toner Cartridge, Okidata B4310, Black PROPERTY LOCATION: 205 West 5th Avenue, Suite 105 Ellensburg, WA 98926 MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 7 EXHIBIT B » SCHEDULE OF PAYMENTS &. OPTION TO PURCHASE PRICE « MUNICIPAL LEASE PURCHASE AGREEMENT No.7768 (THE "AGREEMENT") BY AND BETWEEN Lessor: Government Capital Corporation and Lessee: County of Kittitas Schedule dated as of May 17, 2017 PMT PMT DATE TOTAL INTEREST PRINCIPAL OPTION TO PURCHASE NO , MO DAY YR PAYMENT PAID PAID after pmt on this line 1 At Signing $31,927 .56 $0.00 $31,927.56 N/A 2 5/17/2018 $31,927.56 $3,883.01 $28,044.55 $91,539.93 3 5/17/2019 $31,927.56 $2,958.94 $28,968.62 $61,717.79 4 5/17/2020 $31,927.56 $2,004.42 $29,923.14 $31,209.74 5 5/17/2021 $31,927.56 $1,018.43 $30,909.13 $1.00 Grand Totals $159,637.80 $9,864 .80 $149,773.00 Rate: 3.295% MUNICIPAL LEASE-PURCHASE AGREEMENT -PAGE 8 / INCUMBENCY, INSURANCE, AND ESSENTIAL USE CERTIFICATES MUNICIPAL LEASE-PURCHASE AGREEMENT No.7768 (THE "AGREEMENT") BY AND BETWEEN Lessor, Government Capital Corporation and Lessee, County of Kittitas Dated as of May 2, 2017 I, Julie Kjorsvik, do hereby certify that I am the duly elected or appointed and acting Clerk of the Board (Keeper of the Records), of County of Kittitas, a political subdivision or agency duly organized and existing under the laws of the State of Washington, that I have custody of the records of such entity, and that, as of the date hereof, the indlvidual(s) named below are the duly elected or appointed officer(s) of such entity holding the office(s) set forth opposite their respective name(s). I further certify that (i) the signature(s) set opposite their respective name(s) and title(s) are their true and authentic signature(s), and (ii) such officers have the authority on behalf of such entity to enter into that certain Municipal Lease-Purchase Agreement dated as of May 2, 2017, between such entity and Government Capital Corporation. Signature lomld V. PeWt Coooty A"d;toc ~ ~;L.o,~]+6~-- B",tJI IN WITNESS WHEREOF, I have duly executed this certificate hereto this __ day of ~k .2017 . ~ ,<l BY:~ /~+n-z <k:. JulleOVi;trer 0 Boa rd Lessee certifies that property and liability insurance, if applicable, have been secured in accordance with the Agreement and such coverage will be maintained in full force for the term of the Agreement. "Lessor or its Assigns" should be designated as loss payee until Lessee is notified, in writing, to substitute a new loss payee. The following information is provided about insurance-- INSURANCE COMPANY/AGENT'S NAME : W ~:~+C'" CowV\;h'.v. r( l ~k.-.poo L INSURANCE COMPANY ADDRESS : d55~ te. V'J ~Dh.,t\AW"I f2-I:.Q S W, Sui,1e.. I 01:;7 1lur~a..W\ WA .c1&5l L- 31RO-2..C1:2 .. -t-t44/o 0lO'~ PHONE NUMBER: POLICY NUMBER: __ ----.:...t(:::.....;..oll....:..-_..:....~..::....:~=5_=_k_P:........:...O _"_O _L-___ I<..:_·_T _C.....:O=___ ________ _ I, Jerald V. Pettit, County Auditor, of County of Kittitas ("Lessee"), hereby certify that the Property to be leased to the undersigned under the certain Lease Agreement, dated as of May 2, 2017, between such entity and Government Capital Corporation ("Lessor"), will be used by the undersigned Lessee for the following purpose: (PLEASE FILL OUT PRIMARY USE BELOW) PRIMARY USE--__ £""""","J.L_~......,z.-,-/i....l<(J....:..IfI,-S=-__________________ _ The undersigned hereby represents that the use of the Property is essential to its proper, efficient and economic operation . IN WITNESS WHEREOF, I have set my hand this ;J~ day of t?J /l-CA.... 1 2017 . By Lessee : ,~ ~ . Pettit, Cou nty u~------ For Lessee: County of Kittitas MUNICIPAL LEASE-PURCHASE AGREEMENT .. PAGE 9 Form 803 8 -G Information Return for Tax-Exempt Governmental Obligations (Rev . September 2011 ) Department of the Treasury Internal Revenue Service ~ Under Internal Revenue Code section 149(e) ~ See separate instructions. OMS No . 1545-0720 Caution: If the issue price is under $1 00,000, use Fo rm B03B-G C. 1 Issuer's name .COUIl 91-6001349 3a Julie person (other than issuer) with whom the IRS may communicate about this return (see instructions) k, Clerk of the Board 3b Telephone number of other person shown on 3a 4 Number and street (or P.O. box if mail is not del iv ered to street address) 205 West 5th Avenue 6 City , town, or post office, state, and ZIP code WA 98926 Lease Purchase ll11m •• m,.nt No.7768 Room/suite 105 10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see instructions) Jerald V. Pettit, County Auditor 11 12 13 Transportation . 14 Public safety. 15 Environment (including sewage bonds) 16 Housing 17 Utilities 509-962-7557 5 Report number (For IRS Use 7 Date of issue 05/17/2017 9 CUSIP number None 1 Db Telephone number of officer or other employee shown on 10a 509·962·7557 18 Other. Describe ~ Election Equi pment ~--~~~------------------------------------------~ 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 23 Issue price of entire issue (enter amount from line 21, column (b)) 24 Proceeds used for bond issuance costs (including underwriters ' d iscount) . 25 Proceeds used for credit enhancement . 26 Proceeds allocated to reasonably required reserve or replacement fund 27 Proceeds used to currently refund prior issues 28 Proceeds used to advance refund prior issues 29 Total (add lines 24 through 28) . 29 N/A 30 ceeds of the is s ue 31 Enter the remaining weighted average maturity of the bonds to be currently refunded . ~ N/A years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded ~ N/A years 33 Enter the last date on which the refunded bonds will be called (MM/DDIYYYY) ~ N/A 34 Enter the date(s) the refunded bonds were issued ~ (MM/ODIYYYY~ For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 63773S Form 8038-G (Rev . 9-2011) Form B038-G (Rev. 9-2011) Page 2 i:Jffii'li 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 (GIG) (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 ~ D and enter the follOWing Information: b Enter the date of the master pool obligation ~ ____________________ _ 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)(8)(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 ~ D and enter the following information: b Name of hedge provider ~ c Type of hedge ~ ________________ _ d Term of hedge ~ _________________ _ o D 42 If the issuer has superintegrated the hedge, check box ~ D 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 . ~ D 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 ~ D and enter the amount of reimbursement . . ~ b Enter the date the official intent was adopted ~ Signature and Consent Paid Preparer Use Only Firm's name ~ Him's adareSS ~ ~ D Form a038-G (Rev. 9-2011)