HomeMy WebLinkAboutPR 18669: SIEMENS INDUSTRY PURCHASE AGREEMENT P.R No. 18669
DHE: 10/20/14
RESOLUTION NO.
A RESOLUTION AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASING SCHEDULE
AND RELATED DOCUMENTS TO A MASTER LEASE PURCHASE AGREEMENT TO FUND
THE FINANCING OF THE PERFORMANCE CONTRACTING AGREEMENT BETWEEN THE
CITY OF PORT ARTHUR AND SIEMENS INDUSTRY, INC., BUILDING TECHNOLOGIES
DIVISION, TO IMPROVE THE WATER SYSTEM INFRASTRUCTURE, WHICH INCLUDES A
CITY-WIDE RETROFIT TO FIXED BASED SYSTEM, AUTOMATIC METER READING SYSTEM
UPGRADE, REPLACING LEAKING FIRE HYDRANTS, AND LARGE WATER METERS, IN THE
NOT-TO-EXCEED AMOUNT OF $8,021,021.00; WHICH WILL BE FUNDED BY THE
MASTER LEASE PURCHASE AGREEMENT WITH SIEMENS PUBLIC,INC.
WHEREAS, the City of Port Arthur has extensively reviewed measures to improve its water
system infrastructure and decrease water loss; and
WHEREAS, pursuant to Resolution Number 12-147, the City Council authorized the original
Performance Contract with Siemens Industry, Inc. (Siemens); and
WHEREAS, pursuant to Resolution Number 13-552, the City Manager executed a Master Lease
Purchase Agreement with Siemens Public, Inc.; and
WHEREAS, pursuant to Resolution Number 14-406, the City Manager executed the contract for
Phase III of a performance contracting agreement between the City and Siemens Industry, Inc., Building
Technologies Division, for the replacement of leaking fire to fixed based hydrants, large water meters
and a city-wide retrofit system and automatic meter reading system upgrade.
WHEREAS, the proposed cost of said project is $8,021,021.00, which will be funded by the City
of Port Arthur by this Master Lease Purchase Agreement; and
WHEREAS, said improvements will provide operational cost savings and improve the water
system infrastructure.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR:
That the facts and opinions in the preamble are true and correct.
That it is deemed in the best interest of the City of Port Arthur to execute the leasing schedule
and related documents (Exhibit A) to the Master Lease Purchase Agreement to fund the financing of
the performance contracting agreement between the City of Port Arthur and Siemens Industry, Inc.,
Building Technologies Division, to improve the water system infrastructure which includes a city-wide
retrofit to fixed based system, automatic meter reading system upgrade, replacing leaking fire
hydrants, and large water meters.
That a copy of the caption of this Resolution shall be spread upon the Minutes of the City
Council
READ,ADOPTED,AND APPROVED,this day of , 2014 AD, at a
Regular Meeting of the City council of the City of Port Arthur,Texas by the following vote:AYES
Mayor:
Councilmembers:
NOES:
Mayor
ATTEST:
City Secretary
APPROVED AS TO FORM:
City Attorney
EXHIBIT "A"
SIEMENS Siemens Public, Inc.
LEASING SCHEDULE #280-0002481-001
(Escrow)
LESSOR: SIEMENS PUBLIC,INC. LESSEE: CITY OF PORT ARTHUR,TEXAS
3411 Silverside Road 444 4th Street
Hanby Building,Suite 100 Port Arthur,TX 77641
Wilmington,DE 19810 (409)983-8101
(800)327-4443
LEASING SCHEDULE #280-0002481-001 dated November_, 2014 (herein also referred to as the "Leasing Schedule" or "Lease"), to that
certain Master Lease Purchase Agreement dated November 22,2013(herein"Agreement"),between Lessor and Lessee.
1. EQUIPMENT DESCRIPTION: See Exhibit A attached hereto 6. CONCLUDING PAYMENT: See Lease Payment Schedule
and incorporated herein. attached hereto and incorporated herein as Exhibit B.
2. LEASE COMMENCEMENT DATE: The date that Lessor 7. EQUIPMENT LOCATION: See Exhibit A attached hereto and
executes this Leasing Schedule and provides funds hereunder, incorporated herein.
as reflected on the signature lines of Lessor below.
8. MAXIMUM EQUIPMENT COST: $8,021,021
3. STATE OF LESSEE: TX
9. LEASE PAYMENT LOCATION: Unless Lessor specifies in
4. NUMBER OF LEASE PAYMENTS: 56(quarterly) writing otherwise, all payments shall be sent by wire transfer as
follows:
5. LEASE PAYMENT(per payment period): See Lease Payment Account Title:Siemens Public,Inc.
Schedule attached hereto and incorporated herein as Bank:Citibank,New York
Exhibit B.
Bank Address: 111 Wall Street,New York,New York 10043 USA
Swift Code:CITIUS33
ABA(for Wires and ACH):021000089
Account Number:30824094
10. STATEMENT OF INTENT: It is the intent of Lessor and Lessee that for federal, state and local income tax purposes, the transaction
contemplated hereby will be a conditional sale or financing arrangement consisting of a loan from the Lessor directly to the Lessee, and
the Lessee acquiring and being deemed the owner of the Equipment. For income tax purposes,the parties shall take no action or file any
return or other document inconsistent with such intentions unless otherwise required by U.S.federal, state or local tax law or as directed
by the Internal Revenue Service or a similar state tax authority.
ADDITIONAL TERMS AND CONDITIONS AND OTHER IMPORTANT PROVISIONS ARE SET FORTH ON THE FOLLOWING PAGE.
IN WITNESS WHEREOF,th?parties hereto have duly executed the Lease as of the dates set forth below. For all purposes hereof,the date of the Lease
shall be the date of Lessor's acceptance as set forth below. LESSEE ACKNOWLEDGES THAT NEITHER LESSOR NOR THE SUPPLIER IS AN AGENT
OR REPRESENTATIVE OF THE OTHER AND NEITHER HAS AUTHORITY TO BIND THE OTHER. Lessee certifies that all representations and
warranties of Lessee in the Lease are true as of the date of the Lease.
ACCEPTED BY: BY EXECUTION HEREOF, THE SIGNER CERTIFIES THAT(S)HE HAS
READ THE ENTIRE LEASE, THAT LESSOR OR ITS
LESSOR: SIEMENS PUBLIC,INC. REPRESENTATIVES HAVE MADE NO AGREEMENTS OR
REPRESENTATIONS EXCEPT AS SET FORTH HEREIN, OR IN THE
AGREEMENT,AND THAT(S)HE IS DULY AUTHORIZED TO EXECUTE
BY: THE LEASE ON BEHALF OF LESSEE.
(Authorized Signature)
NAME: LESSEE:CITY OF PORT ARTHUR,TEXAS
(Printed or Typed)
TITLE:
(Printed or Typed) BY:
(Authorized Signature)
NAME:John Comeaux
BY: (Printed or Typed)
(Authorized Signature)
TITLE:City Manager
NAME: (Printed or Typed)
(Printed or Typed) DATE:November_,2014
TITLE:
(Printed or Typed)
DATE:November_,2014
COUNTERPART NO. _ OF 2 SERIALLY NUMBERED MANUALLY EXECUTED COUNTERPARTS. TO THE EXTENT THAT THIS DOCUMENT
CONSTITUTES CHATTEL PAPER UNDER THE UNIFORM COMMERCIAL CODE,NO SECURITY INTEREST IN THIS DOCUMENT MAY BE CREATED
THROUGH THE TRANSFER AND POSSESSION OF ANY COUNTERPART OTHER THAN COUNTERPART NO.1.
11. AMENDMENT TO SECTION 3 OF THE AGREEMENT: For purposes of this Lease,Section 3 of the Agreement shall be deleted and the following
substituted therefor:
"3. Purchase Contracts,Acquisition of Equipment.
(a) The Equipment shall be acquired and installed pursuant to one or more purchase or acquisition contracts(the"Purchase Contracts")to
be entered into by and between Lessee and one or more vendors,suppliers or contractors(the"Suppliers")for the acquisition and installation of the
Equipment. Lessee and Lessor agree that Lessee shall be solely responsible for the selection,size,design and specifications of the Equipment
and that Lessor shall have no duty or responsibility therefor or for the negotiation,execution or delivery of any Purchase Contract.
(b) Lessee represents,warrants and covenants that the cost of the Equipment shall in no event exceed the Maximum Equipment Cost as set
forth in the Leasing Schedule.
(c) Lessee shall enter into Purchase Contracts for the acquisition or installation of the Equipment,the total cost of which shall not exceed the
Maximum Equipment Cost. Further, Lessee shall, after entering into such Purchase Contracts, proceed with due diligence and complete the
acquisition and installation of all the Equipment by no later than eighteen (18) months after the Lease Commencement Date. If the cost of the
Equipment exceeds the monies available in the Escrow Fund(the"Escrow Fund")created by the Escrow Agreement Relating to Equipment Subject
to the Lease(the"Escrow Agreement")among Lessor, Lessee and the Escrow Agent named therein (the"Escrow Agent"), Lessee shall pay the
remaining cost of the Equipment from its other available funds.
(d) Lessee hereby sells, assigns, transfers and sets over to Lessor, all of its rights, title and interest, but none of its obligations or
responsibilities,in and to the Purchase Contracts(whether now in existence or hereafter entered into),including,without limitation,all right,title and
interest of Lessee in and to the Equipment and all of Lessee's rights and remedies under the Purchase Contracts,and the right either in Lessor's
own behalf or in Lessee's name to take all such proceedings,legal equitable or otherwise,that it might take,save for the Lease.
(e) Prior to disbursements under the Escrow Agreement,either directly to one or more Suppliers or in reimbursement of advance payments
by Lessee,for all or a portion of the Equipment accepted by Lessee pursuant to the Lease and the Purchase Contracts, Lessee shall furnish the
Escrow Agent with a requisition requesting disbursement in the form attached as Exhibit A to the Escrow Agreement completed and executed by
Lessee and approved for payment by Lessor,together with the supporting documents referred to in the requisition. Upon the delivery to Escrow
Agent of such instruments,Lessee shall be found to have accepted that portion of the Equipment and related services and labor represented by the
requisition.
(f) If Lessee has not accepted all the Equipment within eighteen(18)months after the Lease Commencement Date or such longer period as
agreed to by the parties in writing(the"Nonacquired Equipment Date"),the Lease shall not as a result thereof be void or voidable,nor shall Lessor
be liable to Lessee for any loss or damage resulting from such nonacceptance of Equipment. Prior to the Nonacquired Equipment Date, Lessee
may,with Lessor's prior written consent,substitute items of Equipment equal in value for items of Equipment not delivered. If all or a part of the
original or substituted Equipment has not been accepted by Lessee on or before the Nonacquired Equipment Date,the Lease shall terminate as to
such unaccepted portion of the Equipment (the "Nonacquired Equipment") as of the Nonacquired Equipment Date. Exhibit A to this Leasing
Schedule shall be deemed to be automatically amended to delete all reference to the Nonacquired Equipment. As set forth in the Escrow
Agreement, a payment to Lessor pursuant to Section 3.5 of the Escrow Agreement shall constitute a partial prepayment of Lease Payments(as
hereinafter defined), and upon receipt of such prepayment, Lessee authorizes Lessor to prepare a revised Exhibit B to this Leasing Schedule
reflecting such prepayment,which shall be delivered to Lessee, and Lessee shall acknowledge such revised Exhibit B in writing if requested by
Lessor.
(g) Monies held by the Escrow Agent pursuant to the Escrow Agreement shall be paid to Lessor in accordance with Section 3.5 of the
Escrow Agreement, including, without limitation, upon the occurrence of a Default or upon a termination of the Lease as a result of Lessee's
governing body failing to appropriate sufficient funds to pay the Lease Payments and other amounts due hereunder for any fiscal period.
(h) Lessee hereby represents as follows:
(i) The estimated total costs of the Equipment, including costs of negotiating and preparing the Lease and any assignment of the
Lease by Lessor,shall not be less than the total principal portion of the Lease Payments.
(ii) The Equipment has been ordered or is expected to be ordered within six months of the Lease Commencement Date, and the
Equipment is expected to be delivered and installed, and the Supplier fully paid, within eighteen (18) months of the Lease
Commencement Date.
(iii)Lessee has not created or established,and does not expect to create or establish,any sinking fund or other similar fund(a)that is
reasonably expected to be used to pay the Lease Payments, or(b)that may be used solely to prevent a default in the payment of the
Lease Payments.
(iv)The Equipment has not been and is not expected to be sold or otherwise disposed of by Lessee,either in whole or in part,prior to
the expiration of the Maximum Lease Term(as defined in Section 5 of the Agreement).
(v) To the best of Lessee's knowledge,information and belief,all expectations referenced above are reasonable."
12. AMENDMENT TO SECTION 6 OF THE AGREEMENT: For purposes of this Lease,Section 6 of the Agreement shall be deleted and the following
substituted therefor:
"6. Delivery and Acceptance. Lessee,as Lessor's agent,shall cause the Equipment to be delivered to Lessee at the location specified in Exhibit A
("Equipment Location"). Lessee shall pay all transportation and other costs,if any,incurred in connection with delivery of the Equipment. Lessee shall
accept the Equipment(by delivery of a requisition request as described in Section 3(e) above) as soon as it has been delivered and is operational.
Concurrently with the delivery of its final requisition request,Lessee shall evidence its acceptance of all Equipment by executing and delivering to Lessor
an Acceptance Certificate substantially in the form attached to the Escrow Agreement. Such Acceptance Certificate shall include the description of all
Equipment covered by any and all requisition requests issued under the Lease (the "Final Equipment Description"). Exhibit A shall be deemed
automatically amended to the extent necessary to correct any differences between Exhibit A and the Final Equipment Description."
13. AMENDMENT TO AGREEMENT: The following Section 28 is hereby added to the Agreement:
28. Role of Lessor. Lessor has not acted and will not act as a fiduciary for Lessee or as Lessee's agent or municipal advisor. Lessor has
not and will not provide financial, legal,tax,accounting or other advice to Lessee or to any financial advisor or placement agent engaged by
Lessee with respect to a Lease. Lessee,its financial advisor,placement agent or municipal advisor,if any,shall each seek and obtain its own
financial, legal, tax, accounting and other advice with respect to a Lease from its own advisors (including as it relates to structure, timing,
terms and similar matters).
14. MISCELLANEOUS: Lessor and Lessee agree that the terms and conditions of the Agreement are hereby incorporated into this Leasing Schedule
to the same extent as if such terms and conditions were set forth in full herein. THIS LEASING SCHEDULE(AS INCORPORATING THE TERMS OF
THE AGREEMENT), TOGETHER WITH ANY EXHIBITS AND ATTACHMENTS HERETO, CONTAIN THE COMPLETE AGREEMENT OF THE
PARTIES WITH RESPECT TO ITS SUBJECT MATTER AND SUPERSEDE AND REPLACE ANY PREVIOUSLY MADE PROPOSALS,
REPRESENTATIONS,WARRANTIES AND AGREEMENTS. Capitalized terms used herein,which are not otherwise defined herein, shall have the
same meanings as set forth in the Agreement. Any amendments contained or incorporated into this Leasing Schedule,which in any way alter the terms
of the Agreement,shall be effective only with respect to this Leasing Schedule and shall be ineffective with respect to any other Leasing Schedule. The
Lease shall become effective at the time of Lessor's acceptance(by execution hereof)at its corporate offices,by an authorized representative of Lessor.
EXHIBIT A
to
Leasing Schedule#280-0002481-001
DESCRIPTION OF EQUIPMENT
Energy savings equipment as described in the Performance Contracting Agreement dated September 25, 2014,
by and between Lessee and Siemens Industry, Inc., Building Technologies Division.
(See Exhibit A-1 attached hereto for Scope of Work and Services and Equipment locations, all of which are
located in Jefferson County, Texas.)
(The foregoing property description shall be deemed to be automatically amended to the extent necessary to
conform to the Final Equipment Description as provided in Section 6 of the Agreement.)
Lessor: SIEMENS PUBLIC, INC. Lessee: CITY OF PORT ARTHUR,TEXAS
By: By:
Title: Title: City Manager
By:
Title:
EXHIBIT B
to
Leasing Schedule#280-0002481-001
LEASE PAYMENT SCHEDULE
Lease Commencement Date: November_,2014
Principal Amount: $8,021,021
Interest Rate: %
(The following draft payment schedule is based on a principal amount of$8,021,021,an interest rate of 3.00%,
and a November 10,2014 closing date. The final rate will be set approximately three days prior to the Lease Commencement Date
in accordance with the signed proposal dated July 29,2014.1
Payment of Payment of Total Cumulative
Payment Lease Interest Current Compounded Payment of Debt Service Compounded Principal Concluding
Date Payment Accrued Interest Interest Principal Paid Interest Balance Payment'
11/10/2014 $8,021,021.00 n/a
12/10/2014 $20,052.55 - - - - $20,052.55 8,021,021.00 n/a
3/10/2015 60,308.05 - - - - 80,360.60 8,021,021.00 n/a
6/10/2015 60,760.36 - - - - 141,120.97 8,021,021.00 n/a
9/10/2015 61,216.06 - - - - 202,337.03 8,021,021.00 n/a
12/10/2015* $156,804.35 61,675.19 $61,675.19 $95,129.16 - $156,804.35 107,207.87 8,021,021.00 $8,290,793.44
3/10/2016 156,804.35 60,961.72 60,961.72 95,842.63 - 156,804.35 11,365.23 8,021,021.00 8,193,033.96
6/10/2016 156,804.35 60,242.90 60,242.90 11,365.23 $85,196.22 156,804.35 - 7,935,824.78 8,094,541.27
9/10/2016 156,804.35 59,518.69 59,518.69 - 97,285.66 156,804.35 - 7,838,539.12 7,995,309.90
12/10/2016 154,385.36 58,789.04 58,789.04 - 95,596.31 154,385.35 - 7,742,942.81 7,897,801.66
3/10/2017 154,385.36 58,072.07 58,072.07 - 96,313.29 154,385.36 - 7,646,629.52 7,799,562.11
6/10/2017 154,385.36 57,349.72 57,349.72 - 97,035.64 154,385.36 - 7,549,593.88 7,700,585.76
9/10/2017 154,385.36 56,621.95 56,621.95 - 97,763.40 154,385.35 - 7,451,830.49 7,600,867.09
12/10/2017 159,016.91 55,888.73 55,888.73 - 103,128.19 159,016.92 - 7,348,702.29 7,495,676.34
3/10/2018 159,016.91 55,115.27 55,115.27 - 103,901.65 159,016.92 - 7,244,800.64 7,389,696.65
6/10/2018 159,016.91 54,336.00 54,336.00 - 104,680.91 159,016.91 - 7,140,119.74 7,282,922.13
9/10/2018 159,016.91 53,550.90 53,550.90 - 105,466.02 159,016.92 - 7,034,653.71 7,175,346.79
' After payment of the Lease Payment and all other amounts then due. The Concluding Payment also contains prepayment fees,if applicable. Prepayments,
as provided in Section 21 of the Lease, are permitted only on the due date of the Lease Payment that is asterisked and on the due date of each Lease
Payment thereafter.
Payment of Payment of Total Cumulative
Payment Lease Interest Current Compounded Payment of Debt Service Compounded Principal Concluding
Date Payment Accrued Interest Interest Principal Paid Interest Balance Payment'
12/10/2018 163,787.42 52,759.90 52,759.90 - 111,027.52 163,787.42 - 6,923,626.20 7,062,098.72
3/10/2019 163,787.42 51,927.20 51,927.20 - 111,860.23 163,787.43 - 6,811,765.96 6,948,001.28
6/10/2019 163,787.42 51,088.24 51,088.24 - 112,699.18 163,787.42 - 6,699,066.79 6,833,048.12
9/10/2019 163,787.42 50,243.00 50,243.00 - 113,544.42 163,787.42 - 6,585,522.37 6,717,232.82
12/10/2019 168,701.05 49,391.42 49,391.42 - 119,309.63 168,701.05 - 6,466,212.74 6,595,536.99
3/10/2020 168,701.05 48,496.60 48,496.60 - 120,204.46 168,701.06 - 6,346,008.27 6,472,928.44
6/10/2020 168,701.05 47,595.06 47,595.06 - 121,105.99 168,701.05 - 6,224,902.28 6,349,400.33
9/10/2020 168,701.05 46,686.77 46,686.77 - 122,014.28 168,701.05 - 6,102,888.00 6,224,945.76
12/10/2020 173,606.41 45,771.66 45,771.66 - 127,834.75 173,606.41 - 5,975,053.25 6,094,554.32
3/10/2021 173,606.41 44,812.90 44,812.90 - 128,793.51 173,606.41 - 5,846,259.74 5,963,184.94
6/10/2021 173,606.41 43,846.95 43,846.95 - 129,759.46 173,606.41 - 5,716,500.28 5,830,830.28
9/10/2021 173,606.41 42,873.75 42,873.75 - 130,732.66 173,606.41 - 5,585,767.62 5,697,482.97
12/10/2021 178,651.14 41,893.26 41,893.26 - 136,757.89 178,651.15 - 5,449,009.73 5,557,989.92
3/10/2022 178,651.14 40,867.57 40,867.57 - 137,783.57 178,651.14 - 5,311,226.16 5,417,450.68
6/10/2022 178,651.14 39,834.20 39,834.20 - 138,816.95 178,651.15 - 5,172,409.21 5,275,857.39
9/10/2022 178,651.14 38,793.07 38,793.07 - 139,858.08 178,651.15 - 5,032,551.13 5,133,202.15
12/10/2022 183,839.04 37,744.13 37,744.13 - 146,094.91 183,839.04 - 4,886,456.22 4,984,185.34
3/10/2023 183,839.04 36,648.42 36,648.42 - 147,190.62 183,839.04 - 4,739,265.60 4,834,050.91
6/10/2023 183,839.04 35,544.49 35,544.49 - 148,294.55 183,839.04 - 4,590,971.05 4,682,790.47
9/10/2023 183,839.04 34,432.28 34,432.28 - 149,406.76 183,839.04 - 4,441,564.30 4,530,395.58
12/10/2023 189,177.00 33,311.73 33,311.73 - 155,865.27 189,177.00 - 4,285,699.03 4,371,413.01
3/10/2024 189,177.00 32,142.74 32,142.74 - 157,034.26 189,177.00 - 4,128,664.77 4,211,238.07
6/10/2024 189,177.00 30,964.99 30,964.99 - 158,212.02 189,177.01 - 3,970,452.75 4,049,861.80
9/10/2024 189,177.00 29,778.40 29,778.40 - 159,398.61 189,177.01 - 3,811,054.13 3,887,275.22
12/10/2024 194,660.01 28,582.91 28,582.91 - 166,077.11 194,660.02 - 3,644,977.02 3,717,876.56
3/10/2025 194,660.01 27,337.33 27,337.33 - 167,322.68 194,660.01 - 3,477,654.34 3,547,207.42
6/10/2025 194,660.01 26,082.41 26,082.41 - 168,577.60 194,660.01 - 3,309,076.73 3,375,258.27
9/10/2025 194,660.01 24,818.08 24,818.08 - 169,841.94 194,660.02 - 3,139,234.79 3,202,019.48
' After payment of the Lease Payment and all other amounts then due. The Concluding Payment also contains prepayment fees,if applicable. Prepayments,
as provided in Section 21 of the Lease, are permitted only on the due date of the Lease Payment that is asterisked and on the due date of each Lease
Payment thereafter.
-2-
Payment of Payment of Total Cumulative
Payment Lease Interest Current Compounded Payment of Debt Service Compounded Principal Concluding
Date Payment Accrued Interest Interest Principal Paid Interest Balance Payment'
12/10/2025 200,301.12 23,544.26 23,544.26 - 176,756.86 200,301.12 - 2,962,477.93 3,021,727.49
3/10/2026 200,301.12 22,218.58 22,218.58 - 178,082.54 200,301.12 - 2,784,395.39 2,840,083.30
6/10/2026 200,301.12 20,882.97 20,882.97 - 179,418.15 200,301.12 - 2,604,977.24 2,657,076.78
9/10/2026 200,301.12 19,537.33 19,537.33 - 180,763.79 200,301.12 - 2,424,213.45 2,472,697.72
12/10/2026 206,101.54 18,181.60 18,181.60 - 187,919.94 206,101.54 - 2,236,293.51 2,281,019.38
3/10/2027 206,101.54 16,772.20 16,772.20 - 189,329.34 206,101.54 - 2,046,964.17 2,087,903.45
6/10/2027 206,101.54 15,352.23 15,352.23 - 190,749.31 206,101.54 - 1,856,214.86 1,893,339.16
9/10/2027 206,101.54 13,921.61 13,921.61 - 192,179.93 206,101.54 - 1,664,034.93 1,697,315.63
12/10/2027 212,065.54 12,480.26 12,480.26 - 199,585.28 212,065.54 - 1,464,449.66 1,493,738.65
3/10/2028 212,065.54 10,983.37 10,983.37 - 201,082.17 212,065.54 - 1,263,367.49 1,288,634.84
6/10/2028 212,065.54 9,475.26 9,475.26 - 202,590.28 212,065.54 - 1,060,777.20 1,081,992.75
9/10/2028 212,065.54 7,955.83 7,955.83 - 204,109.71 212,065.54 - 856,667.49 873,800.84
12/10/2028 218,197.51 6,425.01 6,425.01 - 211,772.50 218,197.51 - 644,894.99 657,792.89
3/10/2029 218,197.51 4,836.71 4,836.71 - 213,360.80 218,197.51 - 431,534.19 440,164.88
6/10/2029 218,197.51 3,236.51 3,236.51 - 214,961.00 218,197.51 - 216,573.19 220,904.65
9/10/2029 218.197.51 1,624.30 1.624.30 216,573.19 218.197.49 - - -
Totals $10,237,177.60 $2,216,156.68 $2013,819.65 $202,337.03 $8,021,021.00 $10,237,177.68
[The remainder of this page left blank intentionally.]
' After payment of the Lease Payment and all other amounts then due. The Concluding Payment also contains prepayment fees,if applicable. Prepayments,
as provided in Section 21 of the Lease, are permitted only on the due date of the Lease Payment that is asterisked and on the due date of each Lease
Payment thereafter.
-3-
(Signature page to Exhibit B to Leasing Schedule#280-0002481-001—Lease Payment Schedule]
Lessor: SIEMENS PUBLIC,INC. Lessee: CITY OF PORT ARTHUR,TEXAS
By: By:
Title: Title:City Manager
By:
Title:
-4-
ESCROW AGREEMENT RELATING TO EQUIPMENT
SUBJECT TO LEASING SCHEDULE#280-0002481-001
NAME AND ADDRESS NAME AND ADDRESS NAME AND ADDRESS
OF LESSOR OF LESSEE OF ESCROW AGENT
Siemens Public, Inc. City of Port Arthur, Texas UMB Bank, N.A.
3411 Silverside Road 444 4th Street 2 S. Broadway, Suite 435
Hanby Building, Suite 100 Port Arthur, TX 77641 St. Louis, MO 63102
Wilmington, DE 19810 Attn: City Manager Attn: Corporate Trust
Attn: President Fax: 409-982-6743 Fax: 314-612-8499
Fax : 302-479-7152
Escrow Fund: "City of Port Arthur, Texas Equipment Acquisition Escrow Fund"
Escrow Fund Deposit: $8,021,021.00
Maximum Financed Lease Preparation Costs: $-0-
In consideration of the mutual agreements and covenants herein contained and for other valuable consideration,
the parties hereto agree as follows:
ARTICLE 1
DEFINITION AND RULES OF CONSTRUCTION
1.1. Definitions. Terms defined in the Lease and capitalized herein shall,for purposes of this Escrow Agreement(the
"Escrow Agreement"), have the meanings given them in the Lease unless the context requires otherwise. The terms
defined below shall have the meanings given to them below:
"Acquisition Costs" means the amount paid for any portion of the Equipment upon the Lessee's acceptance
thereof in connection with the acquisition and installation of the Equipment, all of which shall have been approved by the
Lessor in its sole discretion.
"Authorized Officer of Lessee"means the Mayor or City Manager of the Lessee or any of their designees.
"Authorized Officer of Lessor"means any of the officers designated on an officer list provided by the Lessor to the
Escrow Agent from time to time.
"Code" means the Internal Revenue Code of 1986, as amended.
"Effective Date"means the Lease Commencement Date,as defined in the Lease.
"Escrow Agent" means the Escrow Agent identified above and its successors and assigns.
"Escrow Fund"means the Escrow Fund identified above.
"Escrow Fund Deposit"means the Escrow Fund Deposit identified above.
"Lease" means that certain Leasing Schedule referenced in the title to this Escrow Agreement under Master
Lease Purchase Agreement dated November 10, 2014, between the Lessor and the Lessee.
"Lessee"means the Lessee identified above and its successors and assigns.
"Lessor"means the Lessor identified above and its successors and assigns.
"Maximum Financed Lease Preparation Costs" means the Maximum Financed Lease Preparation Costs identified
above.
"Permitted Investments" means the following to the extent permitted by applicable law and to the extent they
comply with the Arbitrage Investment Instructions attached hereto as Exhibit B:
(i) Bonds or interest-bearing notes or obligations of the United States, or those for which the
faith and credit of the United States are pledged for the payment of principal and interest, which mature on
or before the date on which the proceeds of such bonds, notes or obligations are expected to be used for
the purpose set forth herein;
(ii) Bonds or interest-bearing notes or obligations that are guaranteed as to principal and interest
by a federal agency of the United States,which mature on or before the date on which the proceeds of such
bonds, notes or obligations are expected to be used for the purpose set forth herein;
(iii) Mutual funds invested exclusively in investments described in the preceding Subparagraphs
(i) and (ii), or agreements to repurchase such investments, including those mutual funds for which the
Escrow Agent or an affiliate of the Escrow Agent serves as investment manager, administrator, shareholder
servicing agent, and/or custodian or subcustodian, notwithstanding that (a)the Escrow Agent or an affiliate
of the Escrow Agent receives fees from such funds for services rendered, and (b) the Escrow Agent
charges and collects fees for services rendered pursuant to this Escrow Agreement, which fees are
separate from the fees received from such funds; and
(iv) Interest-bearing deposits of the Escrow Agent.
"Principal Office", when used with respect to the Escrow Agent, means the office of the Escrow Agent situated in
St. Louis, Missouri, at which the Escrow Agent conducts a corporate trust business.
1.2. Rules of Construction. Words of the masculine and feminine genders shall be deemed and construed to
include the neuter gender. Unless the context otherwise indicates, the singular number shall include the plural number
and vice versa, and words importing persons shall include corporations and associations, including public bodies, as well
as natural persons. The terms "hereby," "hereof," "hereto," "herein," "hereunder" and any similar terms, as used in this
Escrow Agreement, refer to this Escrow Agreement.
ARTICLE 2
RECITALS AND REPRESENTATIONS
2.1. Lease Purchase Agreement. The Lessor and the Lessee have entered into the Lease whereby the Lessor has
agreed to lease certain Equipment to the Lessee and the Lessee has agreed to lease said Equipment from the Lessor.
Under the terms of the Lease, the Lessor and the Lessee agree that the Lessee shall provide for the acquisition and
installation of the Equipment.
2.2. Deposit of Monies. To provide for payment of Acquisition Costs, the Lessor will deposit, or cause to be
deposited on its behalf, with the Escrow Agent,the Escrow Fund Deposit.
2.3. Lease Payments. Under the Lease, the Lessee is obligated to pay to the Lessor or its assigns Lease Payments
for the lease of the Equipment.
2.4. Conditions Precedent Satisfied. All acts, conditions and things required by law to exist, happen and be
performed precedent to and in connection with the execution and entering into of this Escrow Agreement have happened
and have been performed in regular and due time, form and manner as required by law, and the parties hereto are now
duly empowered to execute and enter into this Escrow Agreement.
ARTICLE 3
ESTABLISHMENT AND ADMINISTRATION OF ESCROW FUND
3.1. Escrow Fund. The Escrow Fund is hereby established with the Escrow Agent. The Escrow Agent shall keep the
Escrow Fund separate and apart from all other funds and monies held by it. The Escrow Agent agrees to receive and
deposit in the Escrow Fund the Escrow Fund Deposit.
3.2. Administration of the Escrow Fund.
3.2.1. The Escrow Agent shall administer the Escrow Fund as provided in this Section 3.2.
3.2.2. Amounts in the Escrow Fund shall be disbursed for Acquisition Costs as follows:
3.2.2.1. Disbursements for costs incurred in connection with the negotiation and preparation of the
Lease and any assignment of the Lessor's interest in the Lease in an amount not to exceed the
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Maximum Financed Lease Preparation Costs shall be made by the Escrow Agent upon receipt of
written instructions from the Lessor; and
3.2.2.2. Disbursements from the Escrow Fund for Acquisition Costs other than costs associated
with the negotiation and preparation of the Lease and any assignment of the Lessor's interest in the
Lease shall be made by the Escrow Agent upon receipt of a Requisition Requesting Disbursement
in the form attached hereto as Exhibit A, executed by an Authorized Officer of Lessee and
approved for payment by an Authorized Officer of Lessor. So long as the Escrow Agent disburses
funds in accordance with the written instructions of the Lessor pursuant to Section 3.2.2.1 or the
requisition provided for above, it shall have no liability on account of disbursements from the
Escrow Fund under Section 3.2.2 hereof.
3.2.3. After completion of the installation of all of the Equipment and concurrently with its delivery of the final
Requisition Requesting Disbursement, the Lessee shall deliver to the Escrow Agent an Acceptance Certificate
executed by an Authorized Officer of Lessee, substantially in the form of Attachment I to Exhibit A hereto, setting
forth the final acceptance date for the Equipment. Upon receipt of the Acceptance Certificate and the final
Requisition Requesting Disbursement, and subject to the provisions of Section 3.4 hereof, the Escrow Agent shall
pay the balance of any amounts remaining in the Escrow Fund as follows: (i) if so directed in writing by an
Authorized Officer of Lessee and approved in writing by an Authorized Officer of Lessor, the amount specified in
that direction shall be paid to the Lessee to reimburse the Lessee for the interest portion of Lease Payments paid
by the Lessee during the acquisition period for the Equipment, and (ii) any of the balance not paid to the Lessee
pursuant to clause (i) shall be paid to the Lessor on behalf of the Lessee to be applied by the Lessor to prepay a
portion of the Lessee's principal obligations under the Lease.
3.2.4. No amounts shall be withdrawn or transferred from or paid out of the Escrow Fund except as provided in
this Article 3.
3.2.5. If the monies in the Escrow Fund are not sufficient to pay all of the Acquisition Costs, the Lessee shall
pay from other funds the balance of the Acquisition Costs as they come due.
3.3. Monies in Escrow Fund. The monies and the investments held by the Escrow Agent under this Escrow
Agreement are irrevocably held in trust for the benefit of the Lessor and the Lessee, 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 the Lessor or the Lessee. With respect to any
interest that the Lessee may have in the Escrow Fund, the parties hereto intend that the Lessor have a security interest in
the Escrow Fund, and such security interest is‘hereby granted by the Lessee, to secure payment of all sums due to the
Lessor under the Lease. For such purpose, the Escrow Agent hereby agrees to (a) act as control agent for the Lessor in
connection with the perfection of such security interest, (b) note, or cause to be noted, on all books and records relating to
the Escrow Fund, the Lessor's security interest therein, and (c) comply with entitlement orders or other instructions
originated by the Lessor in accordance with Section 3.2 above directing disposition of the funds in the Escrow Fund
without further consent by the Lessee.
3.4. Investment of Monies in Escrow Fund.
3.4.1. All monies held by the Escrow Agent in the Escrow Fund shall be invested and income and earnings
thereon shall be distributed in accordance with the provisions of this Section 3.4.
3.4.2. The Escrow Agent shall invest amounts on deposit in the Escrow Fund in Permitted Investments as
directed by an Authorized Officer of Lessee in writing. In the absence of such written instructions, Escrow Agent
shall invest such monies in investments of the type described in subparagraph (iv) of the definition of Permitted
Investments.
3.4.3. All interest or income on the Escrow Fund shall be deposited in the Escrow Fund.
3.4.4. The Escrow Agent shall not be liable for any loss or decrease in value resulting from the making or
disposition of any investment pursuant to the provisions of this Section 3.4, and any such losses shall be charged
to the Escrow Fund with respect to which such investment was made.
3.4.5. The Escrow Agent shall have the right to liquidate any investments held, in order to provide funds
necessary to make required payments under this Escrow Agreement. The Escrow Agent in its capacity as
escrow agent hereunder shall not have any liability for any loss sustained as a result of any investment made
pursuant to the instructions of the Lessee or as a result of any liquidation of any investment prior to its maturity or
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for the failure by the Lessee to give the Escrow Agent instructions to invest or reinvest the Escrow Fund or any
earnings thereon.
3.4.6. The Lessee and the Escrow Agent shall comply with the Arbitrage Investment Instructions attached
hereto as Exhibit B. The Arbitrage Investment Instructions shall be amended at any time, without action by any
party hereto, if in the opinion of counsel nationally recognized in the area of tax-exempt municipal obligations and
satisfactory to the Lessor and the Lessee, such amendment is necessary or desirable to ensure that the interest
portion of the Lease Payments are excludable from gross income for federal income tax purposes. Neither such
instructions, whether or not amended, nor any failure to amend such instructions shall affect or diminish any
obligation or liability of the Lessee under the Lease, including without limitation Section 9 thereof.
3.5. Termination. The Escrow Fund shall be closed upon the earlier of:
(i) completion of the acquisition and installation of the Equipment as evidenced by an Acceptance
Certificate and payment of all of the Acquisition Costs therefor;
(ii) twenty-four months from the Effective Date (or such later date as may be agreed to in writing by the
Lessor and the Lessee with notice in writing to the Escrow Agent);
(iii) if the Lease is subject to non-appropriation, receipt of a written notice to the Escrow Agent from the
Lessor that the Lease has terminated because the Lessee's governing body has failed to appropriate funds
for the payment of Lease Payments and other amounts due under the Lease for any fiscal period; or
(iv) receipt of a written notice to the Escrow Agent from the Lessor that a Default under the Lease has
occurred.
Upon the occurrence of one of the events described above, the Escrow Agent shall pay the balance of any funds
then remaining in the Escrow Fund to the Lessor or its assigns on behalf of the Lessee to be applied as a prepayment of a
portion of the Lessee's principal obligation under the Lease in a manner determined by the Lessor.
ARTICLE 4
COVENANTS, DEFAULT AND LIMITATION OF LIABILITY
4.1. No Obligation with Respect to Performance by Escrow Agent. The Lessor and the Lessee shall have no
obligation or liability to any party with respect to the performance by the Escrow Agent of any duty imposed upon it under
this Escrow Agreement.
4.2. No Liability by Escrow Agent. The Escrow Agent makes no representations or warranties as to the title to the
Equipment or as to the performance of any obligations of the Lessor or the Lessee.
4.3. No Responsibility for Sufficiency. The Escrow Agent shall not be responsible for the sufficiency of the Lease.
The Escrow Agent shall not be responsible or liable for any loss or decrease in value suffered in connection with any
investment of funds made by it under the terms of and in accordance with this Escrow Agreement.
4.4. Indemnification to Escrow Agent. The Lessee hereby agrees to indemnify and hold the Escrow Agent and its
directors, officers, agents and employees (collectively, the "Indemnitees") harmless from and against any and all claims,
liabilities, losses, damages, fines, penalties, and expenses, including out-of-pocket, incidental expenses, legal fees and
expenses ("Losses") that may be imposed on, incurred by, or asserted against, the Indemnitees or any of them for
following any instruction or other direction upon which the Escrow Agent is authorized to rely pursuant to the terms of this
Escrow Agreement. In addition to and not in limitation of the immediately preceding sentence, the Lessee also agrees to
indemnify and hold the Indemnitees and each of them harmless from and against any and all Losses that may be imposed
on, incurred by, or asserted against the Indemnitees or any of them in connection with or arising out of the Escrow Agent's
performance under this Escrow Agreement, provided the Escrow Agent has not acted with negligence, engaged in willful
misconduct, or breached any provision of this Escrow Agreement. The provisions of this Section 4.4 shall survive the
termination of this Escrow Agreement and the resignation or removal of the Escrow Agent for any reason.
ARTICLE 5
THE ESCROW AGENT
5.1. Appointment of Escrow Agent. The Escrow Agent is hereby appointed to serve in such capacity and the
Escrow Agent shall receive, hold, invest and disburse the monies paid to it pursuant to this Escrow Agreement and the
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income and earnings thereon for credit to the Escrow Fund, and shall perform certain other functions, all as herein
provided and subject to the terms and conditions of this Escrow Agreement.
5.2. Acceptance of Appointment. In consideration of the compensation herein provided for, the Escrow Agent
accepts the appointment above referred to, subject to the terms and conditions of this Escrow Agreement. The Escrow
Agent undertakes to perform only such duties as are expressly set forth herein. The duties and responsibilities of the
Escrow Agent hereunder shall be determined solely by the express provisions of this Escrow Agreement, and no further
duties or responsibilities shall be implied. The Escrow Agent shall not have any liability under, nor duty to inquire into the
terms and provisions of any agreement or instructions, other than outlined in this Escrow Agreement. The Escrow Agent
shall not incur any liability for following the instructions herein contained or expressly provided for, or written instructions
given by the Lessor.
5.3. Escrow Agent; Duties, Removal and Resignation. By executing and delivering this Escrow Agreement, the
Escrow Agent accepts the duties and obligations of the Escrow Agent provided for in this Escrow Agreement, and agrees
to perform such duties and obligations with the same degree of care and skill customarily exercised by financial
institutions in the performance of the duties similar to those set forth in this Escrow Agreement.
The Lessor may, by written request, remove the Escrow Agent initially a party to this Escrow Agreement, and any
successor thereto, and may appoint a successor Escrow Agent, but any such successor shall be a bank or trust company
having a combined capital (exclusive of borrowed capital) and surplus of at least Twenty-five Million Dollars
($25,000,000.00) and subject to supervision or examination by federal or state authority. If such bank or trust company
publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining
authority above referred to, then for the purposes of this Section, the combined capital and surplus of such bank or trust
company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so
published.
The Escrow Agent may at any time resign by giving thirty(30)days written notice to the Lessor, but its resignation
shall not become effective until a successor Escrow Agent has been appointed. Upon receiving such notice of
resignation, the Lessor shall promptly appoint a successor Escrow Agent by an instrument in writing; provided, however,
that in the event the Lessor does not appoint a successor Escrow Agent within sixty (60) days following receipt of such
notice of resignation, the resigning Escrow Agent, at the expense of the Lessor, may petition an appropriate court having
jurisdiction to appoint a successor Escrow Agent. Any resignation or removal of the Escrow Agent and appointment of a
successor Escrow Agent shall become effective upon acceptance of appointment by the successor Escrow Agent. Upon
written notice to the Lessor, any corporation or association into which the Escrow Agent in its individual capacity may be
merged or converted or with which it may be consolidated, or any corporation or association resulting from any merger,
conversion or consolidation to which the Escrow Agent in its individual capacity shall be a party, or any corporation or
association to which all or substantially all the corporate trust business of the Escrow Agent in its individual capacity may
be sold or otherwise transferred, shall be the Escrow Agent hereunder without further act.
5.4. Compensation of the Escrow Agent. The Lessee shall pay$500 to the Escrow Agent on the Effective Date as
compensation for its agreement to provide services under this Escrow Agreement and thereafter either(a) $900 per year
annually payable in arrears or (b) $75 per month or portion thereof for any partial years to the date of termination of this
Escrow Agreement payable in arrears. The Lessee shall be responsible for paying any and all brokerage fees or
commissions or similar expenses incurred in the investment and reinvestment of the Escrow Fund and all other expenses
incurred in connection with this Escrow Agreement, including reasonable attorneys' fees and expenses for matters in
which the Lessee (and/or the Lessor) and the Escrow Agent are not adverse parties and which are not related to the
Escrow Agent's negligence,willful misconduct or breach of any provision of this Escrow Agreement.
5.5. Protection to the Escrow Agent. The Escrow Agent shall be protected in acting upon any notice, resolution,
request, consent, order, certificate, report, opinion, bond, or other paper or document believed by it to be genuine, and to
have been signed or presented by the proper party or parties. The Escrow Agent shall be under no duty to inquire into or
investigate the validity or accuracy of any such document. The Escrow Agent may consult with counsel, who may or may
not be counsel to the Lessor or the Lessee, and the opinion or advice of such counsel shall be full and complete
authorization and protection in respect of any action taken or suffered by it under this Escrow Agreement in good faith and
in accordance therewith.
Whenever the Escrow Agent shall deem it necessary or desirable that a matter be proved or established prior to
taking or suffering any action under this Escrow Agreement, such matter (unless other evidence in respect thereof be
therein specifically prescribed) may be deemed to be conclusively proved and established by a certificate of an Authorized
Officer of Lessee or an Authorized Officer of Lessor, or both, as appropriate, and any such certificate shall be full warrant
for any action taken or suffered in good faith under the provisions of this Escrow Agreement upon the faith thereof, but in
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its discretion the Escrow Agent may in lieu thereof accept other evidence of such fact or matter or may require such
further additional evidence as to it may seem reasonable.
In the event that the Escrow Agent shall be uncertain as to its duties or rights hereunder or shall receive
instructions, claims or demands from any party hereto which, in its opinion, conflict with any of the provisions of this
Escrow Agreement, the Escrow Agent shall provide written notice to the Lessor and Lessee of the reason of such
uncertainty or the receipt of instructions, claims or demands (with a copy thereof to the parties hereto), and it shall be
entitled to refrain from taking any action and its sole obligation shall be to keep safely all property held in escrow until it
shall be directed otherwise in writing by all of the other parties hereto or by a final order or judgment of a court of
competent jurisdiction.
Except as otherwise expressly provided in this Escrow Agreement, any request order, notice or other direction
required or permitted to be furnished pursuant to any provision hereof by the Lessee or the Lessor shall be sufficiently
executed if executed in the name of the Lessee or the Lessor by an Authorized Officer of Lessee or Lessor, as the case
may be.
The Escrow Agent either as principal or agent, may also engage in or be interested in any financial, fiduciary,
agency or other transaction with the Lessee or the Lessor, and may act as depository, trustee, or agent for any assignee
of the Lessor or other obligations of the Lessee as freely as if it were not Escrow Agent hereunder.
The recitals, statements and representations in this Escrow Agreement shall be taken and construed as made on
the part of the Lessee and not by the Escrow Agent, and the Escrow Agent does not assume, and shall not have, any
responsibility or obligation for the correctness of any thereof.
The Escrow Agent may execute any of the trusts or powers hereof and perform the duties required of it hereunder
by or through attorneys, agents, or receivers, and shall be entitled to advice of counsel concerning all matters of trust and
its duties hereunder, and the Escrow Agent shall not be answerable for the default or misconduct of any such attorney,
agent or receiver selected by it with reasonable care. The Escrow Agent shall not be answerable for the exercise of any
discretion or power under this Escrow Agreement or for anything whatever in connection with the Escrow Fund
established hereunder, except only for its own willful misconduct, negligence or breach of any provision of this Escrow
Agreement.
Anything in this Escrow Agreement to the contrary notwithstanding, in no event shall the Escrow Agent be liable
for special, indirect or consequential loss or damage of any kind whatsoever(including, but not limited to, lost profits) even
if advised of the likelihood of such loss or damage and regardless of the form of action.
The Escrow Agent shall not be required to take notice or be deemed to have notice of any default hereunder
unless the Escrow Agent shall be specifically notified in writing of such default by the Lessee or the Lessor. All notices or
other instruments required hereunder to be delivered to the Escrow Agent must, in order to be effective, be delivered to
the office of the Escrow Agent as specified in Section 6.3 herein, and in the absence of such notice so delivered, the
Escrow Agent may conclusively assume there is no such default except as aforesaid.
The Escrow Agent shall not be required to give any bond or surety in respect of the execution of the said trusts
and powers or otherwise in respect of the premises.
Before taking such action hereunder, the Escrow Agent may require that it be furnished an indemnity bond
satisfactory to it for the reimbursement to it of all expenses to which it may be put and to protect it against all liability,
except liability which is adjudicated to have resulted from the Escrow Agent's negligence, willful misconduct or breach of
any provision of this Escrow Agreement.
ARTICLE 6
AMENDMENT;ADMINISTRATIVE PROVISIONS
6.1. Amendment. This Escrow Agreement may only be amended by written agreement among all of the parties.
6.2. Escrow Agent to Keep Records. The Escrow Agent shall keep a copy of this Escrow Agreement and books
and records of all monies received and disbursed under this Escrow Agreement, which shall be available for inspection by
the Lessor at any time during regular business hours upon prior written request. In addition, the Escrow Agent shall
furnish monthly statements of any monies received and disbursed during such period and the balance of any monies held
and a listing of the investment(s)of such monies at the end of such monthly period to the Lessor.
6.3. Notices. All communications hereunder shall be in writing, shall be sent to the appropriate notice address set
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forth on Page 1 of this Agreement, or at such other address as any party hereto may have furnished to the other parties in
accordance with this section, and shall be deemed to be duly given and received:
(i) upon delivery if delivered personally or upon confirmed transmittal via telephone call-back to
one of the phone numbers listed on Schedule 1 hereto or such other phone number as provided by the
Lessor to the Escrow Agent if by facsimile; or
(ii) on the date received if sent by overnight courier or if mailed by prepaid certified mail, return
receipt requested.
In the event that the Escrow Agent, in its sole discretion, shall determine that an emergency exists, the Escrow Agent may
use such other means of communication as the Escrow Agent deems appropriate. All written notices hereto shall be
simultaneously given to Lessor's Fiscal Agent, Siemens Financial Services, Inc., 170 Wood Avenue South, Iselin, NJ
08830, Attention: Chief Financial Officer.
6.4. Governing Law. This Escrow Agreement shall be construed and governed in accordance with the laws of the
State of New York without regard to its principles of conflicts of laws (other than Section 5-1401 of the New York General
Obligations Law), and any action brought hereunder shall be brought in the courts of the State of New York, located in the
County of New York. Each party hereto irrevocably waives any objection on the grounds of venue, forum non-conveniens
or any similar grounds and irrevocably consents to service of process by mail or in any other manner permitted by
applicable law, and consents to the jurisdiction of said courts.
6.5. Security Procedures. In the event funds transfer instructions are given (other than in writing at the time of
execution of this Escrow Agreement) whether in writing, by telecopier or otherwise, the Escrow Agent shall seek
confirmation of such instructions by telephone call-back to the person or persons designated on Schedule 1 hereto, and
the Escrow Agent may rely upon the confirmation of anyone purporting to be the person or persons so designated. The
persons and telephone numbers for individuals authorized to give or confirm payment instructions may be changed only in
a writing actually received and acknowledged by the Escrow Agent. The Escrow Agent and the beneficiary's bank in any
funds transfer may rely solely upon any account numbers or similar identifying numbers provided by the Lessor or the
Lessee to identify(i)the beneficiary, (ii)the beneficiary's bank, or(iii)an intermediary bank. The Escrow Agent may apply
any of the escrowed funds for any payment order it executes using any such identifying number, even when its use may
result in a person other than the beneficiary being paid, or the transfer of funds to a bank other than the beneficiary's bank
or an intermediary bank designated. The parties to this Escrow Agreement acknowledge that these security procedures
are commercially reasonable. All funds transfer instructions must include the signature of the person(s) authorizing said
funds transfer.
6.6 Severability. Any provision of this Escrow Agreement found to be prohibited by law shall be ineffective only to
the extent of such prohibition, and shall not invalidate the remainder of this Escrow Agreement.
6.7. Binding on Successors. This Escrow Agreement shall be binding upon and inure to the benefit of the parties
and their respective successors and assigns.
6.8. Headings. Headings preceding the text of the several Articles and Sections hereof, and the table of contents, are
solely for convenience of reference and shall not constitute a part of this Escrow Agreement or affect its meaning,
construction or effect.
6.9. Execution in Counterparts; Electronic Transaction. This Escrow Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which shall constitute but one and the same instrument.
All signatures of the parties to this Escrow Agreement may be transmitted by facsimile, and such facsimile will, for all
purposes, be deemed to be the original signature of such party whose signature reproduces and will be binding upon such
party. If one of the parties requests after the date of this Escrow Agreement that the other parties hereto deliver a copy of
the Escrow Agreement with an original signature page to such requesting party, the non-requesting parties shall promptly
deliver a copy of this Escrow Agreement with an original signature page to the requesting party. In addition, the
transaction described herein may be conducted and related documents may be stored by electronic means. Copies,
telecopies, facsimiles, electronic files and other reproductions of original executed documents shall be deemed to be
authentic and valid counterparts of such original documents for all purposes, including the filing of any claim, action or suit
in the appropriate court of law.
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6.10. Force Majeure. In the event that any party to this Escrow Agreement is unable to perform its obligations under
the terms of this Escrow Agreement because of acts of God, strikes, equipment or transmission failure or damage
reasonably beyond its control, or other cause reasonably beyond its control, such party shall not be liable for damages to
the other parties for any unforeseeable damages resulting from such failure to perform or otherwise from such causes.
Performance under this Escrow Agreement shall resume when the affected party is able to perform substantially that
party's duties.
6.11 Tax Identification Numbers. Upon execution of this Agreement,the Lessee shall provide the Escrow Agent with
a fully executed W-8 or W-9 IRS form, or such other tax document as is appropriate for the Lessee, which shall include
the Lessee's Tax Identification Number. All interest or other income earned under the Escrow Agreement shall be for the
account of Lessee and shall be so reported by the Escrow Agent to the Internal Revenue Service and all other applicable
taxing authorities. The Escrow Agent shall report, and, as required, withhold and remit, to the appropriate authorities, any
taxes as it determines may be required by any law or regulation in effect at the time of a distribution or as otherwise
required. In the event that any earnings remain undistributed at the end of any calendar year, Escrow Agent shall report
to the Internal Revenue Service or such other authority such earnings as it deems appropriate or as required by any
applicable law or regulation or, to the extent consistent therewith, as directed in writing by the Lessor and Lessee.
6.12 Account Opening Information. In order to assist the United States government to prohibit 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. Accordingly, in order to establish the Escrow Fund, the
Escrow Agent will ask for information that will allow the Escrow Agent to identify all relevant parties.
IN WITNESS WHEREOF, the parties have executed and attested this Escrow Agreement by their officers
thereunto duly authorized as of the Effective Date.
CITY OF PORT ARTHUR,TEXAS,as Lessee
By:
Name:John Comeaux
Title: City Manager
UMB BANK, N.A.,as Escrow Agent
By:
Name:
Title:
SIEMENS PUBLIC, INC.,as Lessor
By:
Name:
Title:
By:
Name:
Title:
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FEDERAL TAX CERTIFICATE
This FEDERAL TAX CERTIFICATE (the "Tax Certificate"), is executed as of November 10,
2014, by the CITY OF PORT ARTHUR,TEXAS (the"City").
RECITALS
1. This Tax Certificate is being executed and delivered in connection with Leasing Schedule
#280-0002481-001 dated November 10, 2014, to Master Lease Purchase Agreement dated November
22, 2013 (the "Agreement"), entered into between the City, as lessee, and Siemens Public, Inc., as
lessor("Lessor").
2. The Internal Revenue Code of 1986, as amended, and the applicable Regulations and
rulings issued by the U.S. Treasury Department(the"Regulations") impose certain limitations on the uses
and investment of proceeds of the Agreement and of certain other money relating to the Agreement, and
set forth the conditions under which the interest component of lease payments payable under the
Agreement will be excluded from gross income for federal income tax purposes.
3. The City is executing this Tax Certificate in order to set forth certain facts, covenants,
representations, and expectations relating to the use and investment of proceeds of the Agreement and
the property financed with those proceeds and of certain other related money, in order to establish and
maintain the exclusion from gross income for federal income tax purposes of the interest component of
lease payments payable under the Agreement, and to provide guidance for complying with the arbitrage
rebate provisions of Code§ 148(f).
4. The City adopted a Tax and Securities Compliance Procedure on November 12, 2013
(the "Tax Compliance Procedure"), for the purpose of setting out general procedures for the City to
continuously monitor and comply with the federal income tax requirements set out in the Code and the
Regulations.
NOW,THEREFORE, in consideration of the foregoing and the mutual representations, covenants
and agreements set forth in this Tax Certificate, the City represents, covenants and agrees as follows:
Section 1. Definitions of Words and Terms. Except as otherwise provided in this Tax
Certificate or unless the context otherwise requires, capitalized words and terms used in this Tax
Certificate have the same meanings as set forth in the Agreement, and certain other words and phrases
have the meanings assigned in Code §§ 103, 141-150 and the Regulations. The following words and
terms used in this Tax Certificate have the following meanings:
"Agreement" means, collectively, Leasing Schedule #280-0002481-001 dated November 10,
2014 to that certain Master Lease Purchase Agreement dated November 22, 2013, between the City, as
lessee, and Lessor, as lessor.
"Annual Compliance Checklist" means a checklist for the Equipment designed to measure
compliance with the requirements of this Tax Certificate and the Tax Compliance Procedure after the
Closing Date substantially in the form attached as Exhibit D.
"Bond Counsel" means Andrews Kurth LLP, Houston, Texas, or other nationally recognized firm.
of bond counsel.
"City" means the City of Port Arthur, Texas.
"Closing Date" means November 10, 2014.
"Code" means the Internal Revenue Code of 1986, as amended.
"Compliance Officer" means the Director of Finance of the City or other person named in the
Tax Compliance Procedure.
"Equipment" means certain energy savings equipment for the City to be acquired by the City
with proceeds of the Agreement, as listed on Exhibit C to this Tax Certificate.
"Escrow Agent" means UMB Bank, N.A., as escrow agent under the Escrow Agreement.
"Escrow Agreement" means the Escrow Agreement relating to Equipment Subject to Leasing
Schedule #280-0002481-001 dated the date hereof, among the City, Lessor and the Escrow Agent, as
amended from time to time.
"Escrow Fund" means the fund of that name established and administered by the Escrow Agent
pursuant to the Escrow Agreement.
"Final Written Allocation" means the Final Written Allocation of expenditures prepared by the
Compliance Officer in accordance with the Tax Compliance Procedure and Section 4(d) of this Tax
Agreement.
"Gross Proceeds" means (a) sale proceeds (any amounts actually or constructively received by
the City from the execution and delivery of the Agreement), (b) investment proceeds (any amounts
received from investing sale proceeds), (c) any amounts held in a sinking fund for the Agreement, (d) any
amounts held in a pledged fund or reserve fund for the Agreement, and (e) any other replacement
proceeds.
"Guaranteed Investment Contract" is any investment with specifically negotiated withdrawal or
reinvestment provisions and a specifically negotiated interest rate, including any agreement to supply
Investments on two or more future dates(e.g.,a forward supply contract).
"IRS" means the Internal Revenue Service.
"Lessor" means Siemens Public, Inc., a Delaware corporation, and its successor or assigns.
"Management Agreement" means a legal agreement defined in Regulations § 1.141-3(b) as a
management, service, or incentive payment contract with an entity that provides services involving all or a
portion of the Equipment, such as a contract to manage the Equipment or a portion thereof. Contracts for
services that are solely incidental to the primary governmental function of the Equipment (for example,
contracts for janitorial, office equipment repair, billing or similar services); however, are not treated as
Management Agreements.
"Measurement Period" means, with respect to each item of property financed as part of the
Equipment, the period beginning on the later of(i) the Closing Date or(ii) the date the property is placed in
service and ending on the earlier of (A) the final maturity date of the Agreement or (B) the end of the
expected economic useful life of the property.
"Non-Qualified Use" generally means any use of the Equipment in a trade or business carried
on by any Non-Qualified User that is different in form or substance from the use made of the Equipment
by any other member of the general public. Generally, ownership, a lease, or any other use that provides
a Non-Qualified User a special legal right or entitlement to use the Equipment will constitute Non-
Qualified Use. Use pursuant to a Qualified Use Agreement is not a Non-Qualified Use.
"Non-Qualified User" means any person or entity other than a Qualified User.
"Opinion of Bond Counsel" means the written opinion addressed to Lessor of a firm of
nationally recognized bond counsel acceptable to Lessor to the effect that the proposed action or the
failure to act will not adversely affect the exclusion of the interest component of lease payments on the
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Agreement from gross income for federal income tax purposes or an opinion describing additions,
modifications or additional procedures required to preserve the interest component of lease payments on
the Agreement from gross income for federal income tax purposes.
"Post-Issuance Tax Requirements" means those requirements related to the use of proceeds
of the Agreement,the use of the Equipment and the investment of Gross Proceeds after the Closing Date.
"Qualified Use Agreement"means any of the following:
(1) A lease or other short-term use by members of the general public who use the
Equipment on a short-term basis in the ordinary course of the City's governmental purposes.
(2) Agreements with Qualified Users or Non-Qualified Users to use all or a portion of
the Equipment for a period up to 200 days in length pursuant to an arrangement whereby(a)the use
of the Equipment under the same or similar arrangements is predominantly by natural persons who
are not engaged in a trade or business and(b)the compensation for the use is determined based on
generally applicable, fair market value rates that are in effect at the time the agreement is entered
into or renewed. Any Qualified User or Non-Qualified User using all or any portion of the Equipment
under this type of arrangement may have a right of first refusal to renew the agreement at rates
generally in effect at the time of the renewal.
(3) Agreements with Qualified Users or Non-Qualified Users to use all or a portion of
the Equipment for a period up to 100 days in length pursuant to arrangements whereby(a)the use of
the property by the person would be general public use but for the fact that generally applicable and
uniformly applied rates are not reasonably available to natural persons not engaged in a trade or
business, (b) the compensation for the use under the arrangement is determined based on
applicable, fair market value rates that are in effect at the time the agreement is entered into or
renewed,and(c)the Equipment was not constructed for a principal purpose of providing the property
for use by that Qualified User or Non-Qualified User.Any Qualified User or Non-Qualified User using
all or any portion of the Equipment under this type of arrangement may have a right of first refusal to
renew the agreement at rates generally in effect at the time of the renewal.
(4) Agreements with Qualified Users or Non-Qualified Users to use all or a portion of
the Equipment for a period up to 50 days in length pursuant to a negotiated arm's-length
arrangement at fair market value so long as the Equipment was not constructed for a principal
purpose of providing the property for use by that person.
"Qualified User" means a State, territory, possession of the United States, the District of
Columbia, or any political subdivision thereof, or any instrumentality of such entity, but it does not include
the United States or any agency or instrumentality of the United States.
"Regulations" means United States Treasury Regulations governing obligations the interest on
which is excluded from gross income for federal income tax purposes under Code§§ 103 and 141-150.
"Special Tax Counsel"means Gilmore& Bell, P.C., Kansas City, Missouri.
"State"means the State of Texas.
"Tax Compliance File" means documents and records for the Agreement maintained by the
Compliance Officer pursuant to this Tax Certificate and the Tax Compliance Procedure.
"Tax Compliance Procedure" means the City's Tax and Securities Compliance Procedure dated
November 12, 2013.
"Yield"means the yield on the Agreement, computed under Regulations§1.148-4.
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Section 2. Purpose of the Agreement. The Agreement is being executed and delivered to
provide funds to acquire the Equipment. On the Closing Date, all proceeds of the Agreement will be
deposited in the Escrow Fund and used to acquire the Equipment, including payment of interest on the
Agreement during the acquisition and installation period.
Section 3. Purchase Price; Agreement Yield; Expenditure of Proceeds; Rebate and
Yield Restriction.
(a) Purchase Price. Lessor has represented in the Certificate of Lessor dated as of the
Closing Date and attached to this Tax Certificate as Exhibit E, that on the Closing Date it has purchased
the Agreement for $8,021,021.00, without accrued interest (the "Purchase Price"), and that it intends to
hold the Agreement for its own account with no present intention to sell, assign or transfer the Agreement
to any other entity.
(b) Yield. Based on the Purchase Price, the Yield on the Agreement is %, as
computed by Special Tax Counsel and shown on Exhibit A. The City has not entered into an interest
rate swap agreement with respect to any portion of the proceeds of the Agreement.
(c) Expenditure of Proceeds. On the Closing Date, the sale proceeds of the Agreement in
the amount of$8,021,021.00 will be deposited in the Escrow Fund held by the Escrow Agent pursuant to
the Escrow Agreement and used to acquire the Equipment and pay interest on the Agreement during the
acquisition and installation period. The City has incurred, or will incur within 6 months after the Closing
Date, a substantial binding obligation to a third party to spend at least 5% of the sale proceeds on the
Equipment. The acquisition and installation of the Equipment and the allocation of the sale proceeds to
expenditures will proceed with due diligence. At least 85% of the sale proceeds will be used to carry out
the governmental purpose of the Agreement within 3 years after the Closing Date, and not more than
50% of the proceeds of the Agreement will be invested in investments having a substantially guaranteed
yield for 4 years or more.
(d) Rebate and Yield Restriction Requirements.
(1) Expectations. All Agreement proceeds will be deposited in the Escrow Fund and
used within 18 months of the Closing Date to acquire and install the Equipment. The City has not
established and does not expect to establish: (A) any sinking fund or other similar fund that is
expected to be used to pay principal or interest portions of lease payments under the Agreement;
or(B)any reserve or replacement fund for the Agreement.
(2) Specific Arbitrage Rebate Instructions. The City will comply with the
requirements of the Arbitrage Investment Instructions included as Exhibit B to the Escrow
Agreement (the "Arbitrage Instructions"). The City acknowledges that the "Small Issuer
Exception" as described in Section 4 of the Arbitrage Instructions does not apply to the
Agreement. [Sublectato revision; after completed tax questionnaire is received:]
(3) Arbitrage Rebate and Yield Reduction Payments. If required, the City will timely
file IRS Form 8038-T (Arbitrage Rebate, Yield Reduction and Penalty in Lieu of Arbitrage Rebate)
and pay any arbitrage rebate or yield reduction payments required by the Code or the
Regulations.
Section 4. Use of Equipment; Post-Issuance Tax Requirements and Record Keeping.
(a) General— Restrictions on Use of Equipment. Throughout the Measurement Period, for
federal tax purposes, all of the Equipment will be owned by the City. As of the Closing Date, the City
does not expect that any portion of the Equipment will be used in a Non-Qualified Use throughout the
Measurement Period. Unless the City obtains an Opinion of Bond Counsel, the City will not enter into any
legal agreement that gives a Non-Qualified User a legal right to use more than 10% of the Equipment.
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This restriction will not apply to use of the Equipment by any natural person employed by the City. The
City specifically represents and covenants as follows:
(1) Management Agreements. As of the Closing Date, the City does not have any
Management Agreements with Non-Qualified Users with respect to the Equipment. During the
Measurement Period,the City will not enter into any Management Agreements with Non-Qualified
Users with respect to the Equipment without first obtaining an Opinion of Bond Counsel. ESubject
to revsign after completed tax questionnaire is received.]
(2) Leases. As of the Closing Date, the City has not entered into any leases with
Non-Qualified Users other than Qualified Use Agreements with respect to the Equipment. During
the Measurement Period, the City will not enter into any leases with Non-Qualified Users other
than Qualified Use Agreements with respect to the Equipment without first obtaining an Opinion
of Bond Counsel. [Subject to revision;after completed tax questionnaire is received.]
(b) Written Policies and Procedures of the City. The City intends for the Tax Compliance
Procedure, as supplemented by this Tax Certificate, to be its primary written policies and procedures for
monitoring compliance with the Post-Issuance Tax Requirements for the Agreement and to supplement
any other formal policies and procedures related to the Post-Issuance Tax Requirements that the City has
established. The provisions of this Tax Certificate are intended to be consistent with the Tax Compliance
Procedure. In the event of any inconsistency between the Tax Compliance Procedure and this Tax
Certificate, the terms of this Tax Certificate will govern.
(c) Compliance Officer. The City, when necessary to fulfill the Post-Issuance Tax
Requirements, will, through the Compliance Officer, sign Form 8038-T in connection with the payment of
arbitrage rebate or yield reduction payments, participate in any federal income tax audit of the Agreement
or related proceedings under a voluntary compliance agreement procedures (VCAP) or undertake a
remedial action procedure pursuant to Regulations§ 1.141-12.
(d) Final Written Allocation. The City will prepare written records substantiating the allocation
of proceeds the Agreement to the acquisition and installation of the Equipment through requisitions from
the Escrow Fund established under the Escrow Agreement. Attached hereto as Exhibit F is a sample
Final Written Allocation.
(e) Annual Compliance Checklist. Attached as Exhibit D is a form of Annual Compliance
Checklist for the Agreement. The Compliance Officer will prepare and complete an Annual Compliance
Checklist for the Equipment at least annually. In the event the Annual Compliance Checklist identifies a
deficiency in compliance with the requirements of this Tax Certificate, the Compliance Officer will obtain
an Opinion of Bond Counsel and take actions to correct any deficiency. The Compliance Officer will
retain a completed copy of all Annual Compliance Checklists in the Tax Compliance File.
(f) Record Keeping. The Compliance Officer will maintain the Tax Compliance File for the
Agreement in accordance with the Tax Compliance Procedure. Unless otherwise specifically instructed in
a written Opinion of Bond Counsel or to the extent otherwise provided in this Tax Certificate, the
Compliance Officer shall retain records related to the Post-Issuance Tax Requirements until 3 years
following the final maturity of(i)the Agreement or(ii) any obligation issued to refund the Agreement. Any
records maintained electronically must comply with Section 4.01 of Revenue Procedure 97-22, which
generally provides that an electronic storage system must (1) ensure an accurate and complete transfer
of the hardcopy records which indexes, stores, preserves, retrieves and reproduces the electronic
records, (2) include reasonable controls to ensure integrity, accuracy and reliability of the electronic
storage system and to prevent unauthorized alteration or deterioration of electronic records, (3) exhibit a
high degree of legibility and readability both electronically and in hardcopy, (4) provide support for other
books and records of the City, and (5) not be subject to any agreement that would limit the ability of the
IRS to access and use the electronic storage system on the City's premises.
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Section 5. Miscellaneous
(a) Form 8038-G. A copy of the completed and fully executed IRS Form 8038-G
(Information Return for Tax-Exempt Governmental Obligations) is attached to this Tax Certificate as
Exhibit B. The Form 8038-G was prepared by Special Tax Counsel as paid preparer, based on
representations and covenants by the City and Lessor that are contained in this Tax Certificate and the
exhibits hereto or otherwise made by the City and Lessor. The information contained on IRS Form 8038-
G is true, complete and correct to the knowledge of the undersigned and the undersigned is authorized to
sign the Form 8038-G on behalf of the City and deliver it to Special Tax Counsel for filing with the IRS.
The City has allocated $ of the sale proceeds of the Agreement to reimburse
expenditures made prior to the Closing Date and that amount should be reflected on Line 45a of Form
8038-G.
(b) Single Issue. The Agreement will be executed and delivered on the Closing Date. No
other debt obligations of the City (1) are being sold within 15 days of the execution and delivery of the
Agreement, (2) are being sold under the same plan of financing as the Agreement, and (3) are expected
to be paid from substantially the same source of funds as the Agreement (disregarding guarantees from
unrelated parties, such as bond insurance).
(c) No Federal Guaranty. The payment of lease payments on the Agreement is not, and the
City will not permit the payment of lease payments on the Agreement to be, directly or indirectly,
guaranteed by the United States of America or any agency thereof.
(d) Record Owner. Pursuant to Code § 149(a), the City will maintain or cause to be
maintained a record of the owner(s) of the Agreement and the person or entity entitled to the receipt of
the principal and interest payments on the Agreement. Transfer of ownership of the Agreement is
effective only if entered in these records.
(e) Agreement Not Qualified Tax-Exempt Obligation. The Agreement is not designated as a
"qualified tax-exempt obligation" under Code§265(b)(3).
(f) Reliance. The City understands that its certifications will be relied upon by the law firm of
Gilmore & Bell, P.C., in rendering its opinion as to the validity of the Agreement and the exclusion from
federal gross income of the interest component of lease payments on the Agreement and in preparation
of IRS Form 8038-G.
(g) Enforceability. If any provision in this Tax Certificate or in the Agreement is determined to
be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will
not be affected or impaired.
(h) Electronic Transactions. The transaction described in this Tax Certificate may be
conducted, and related documents may be stored, by electronic means.
[The remainder of this page left blank intentionally.]
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IN WITNESS WHEREOF,the undersigned, by execution of this Tax Certificate, hereby makes the
foregoing certifications, representations, and agreements contained in this Tax Certificate on behalf of the
City.
CITY OF PORT ARTHUR, TEXAS
By:
Title: City Manager
7
OFFICER'S CERTIFICATE
Issued in Connection with Leasing Schedule#280-0002481-001 dated November_, 2014
(the "Lease"), to Master Lease Purchase Agreement dated November 22, 2013 (the
"Agreement") between Lessee and Siemens Public, Inc.
The undersigned, being a duly qualified and acting officer of the City of Port Arthur, Texas ("Lessee"),
DOES HEREBY CERTIFY AS FOLLOWS:
1. Attached hereto are true and complete copies of the resolutions or other authorizing
document adopted, signed and approved by the governing body of Lessee, authorizing
execution and delivery of (a) the Lease, as incorporating the terms and conditions of the
Agreement, (b)the Escrow Agreement Relating to Equipment Subject to Leasing Schedule
#280-0002481-001 dated November , 2014 (the "Escrow Agreement"), among Lessee,
Siemens Public, Inc. and the escrow agent named therein, (c) the Federal Tax Certificate
dated November _, 2014 (the "Tax Certificate"), (d) the Performance Contracting
Agreement dated September 25, 2014 (the "Energy Savings Contract"), by and between
Lessee and Siemens Industry, Inc., Building Technologies Division, and (e) all related
documents, and consummation of the transactions contemplated thereby.
2. The official of Lessee who executed the Lease, as incorporating the terms and conditions
of the Agreement, the Escrow Agreement, the Tax Certificate and the Energy Savings
Contract on behalf of Lessee and whose signature appears on those documents; (a) is the
duly qualified and acting officer of Lessee as stated beneath his or her signature, and (b)
has been authorized to execute those documents on behalf of Lessee.
3. The following official or representative of Lessee is authorized to act on behalf of Lessee in
matters relating to the Lease, as incorporating the terms and conditions of the Agreement,
the Escrow Agreement and the Energy Savings Contract and the Equipment covered
thereby:
Name Office Signature
John Comeaux City Manager
4. The budget year of Lessee is from October 1 to September 30.
IN WITNESS WHEREOF, the undersigned has executed this Officer's Certificate as of the date set forth
below.
Name: Sherri Bellard
Title: City Secretary
Date: November_, 2014
ESSENTIAL USE/SOURCE OF FUNDS CERTIFICATE
LESSEE NAME: City of Port Arthur,Texas
Re: Leasing Schedule #280-0002481-001 dated November_, 2014 (the "Lease") to Master
Lease Purchase Agreement dated November 22, 2013, between the undersigned
("Lessee")and Siemens Public, Inc.
This certificate confirms and affirms that the equipment described in the Lease referenced above (the "Equipment") is
essential to the functions of the Lessee or to the services Lessee provides its citizens. Further, Lessee has an immediate
need for, and expects to make immediate use of, substantially all such Equipment, which need is not temporary or
expected to diminish in the foreseeable future. Lessee will use such Equipment only for the purpose of performing one or
more of Lessee's governmental or proprietary functions consistent with the permissible scope of its authority.
1. Is the Equipment new, an upgrade, additional or a replacement? If replacement, how old is the existing equipment?
If new, is the Equipment for a start-up program?
The Equipment will be new. It replaces existing equipment. Existing fire hydrants are over 30 years old. The
large meters range from 5-25 years old. The AMI fixed base system consists of new antenna on existing
meters and the infrastructure to support it.
2. Please fully explain the use of the Equipment, including any specific department which may be its primary user.
Fire Hydrants and Water Meters—used City-wide.
3. If any of the Equipment is computer software, on what hardware will the software run, and is the existing hardware
owned or being leased?
The software will be cloud based and runs on any city computer through internet access. The City will be
paying a Hosting Fee for this software and that fee is computed into the cash flow presented to the City.
4. From which fund will lease payments be made?
General Fund.
5. Will any loan or grant monies be used to make lease payments?
No.
CITY OF PORT ARTHUR,TEXAS
By:
Name: John Comeaux
Title: City Manager
Date: November_, 2014
INSURANCE COVERAGE REQUIREMENTS
TO LESSOR: SIEMENS PUBLIC, INC. its Successors and/or Assigns ATIMA
(CERTIFICATE c/o Siemens Financial Services, Inc.
HOLDER) 3411 Silverside Road
Hanby Building, Suite 100
Wilmington, DE 19810
FROM LESSEE: CITY OF PORT ARTHUR,TEXAS
(INSURED) 444 4th Street
Port Arthur, TX 77641
LEASING SCHEDULE #280-0002481-001 dated November _, 2014 (the "Lease"), to MASTER LEASE PURCHASE
AGREEMENT dated November 22, 2013 (the"Agreement") between the undersigned ("Lessee")and Siemens Public, Inc.
EQUIPMENT LOCATIONS: Various locations throughout the City of Port Arthur, Texas
SUBJECT: INSURANCE COVERAGE REQUIREMENTS
Check All Appropriate Boxes:
• Third-Party Insurance. In accordance with Section 16 of the Agreement, we have instructed the insurance
agent named below to issue the insurance indicated below (please fill in name, address and telephone
number of insurance agent):
Texas Municipal League Risk Pool
P.O. Box 149194
Austin, TX 78714-9194
▪ All Risk Physical Damage Insurance on the leased equipment (Equipment") covered by the Lease,
evidenced by a Certificate of Insurance and Long Form Loss Payable Clause naming Siemens
Public, Inc., and/or its assigns,as additional insured and loss payee.
Coverage Required: Full Replacement Value
• Public Liability Insurance evidenced by a Certificate of Insurance naming Siemens Public, Inc.,
and/or its assigns as Additional Insured.
Minimum Coverage Required:
$500,000.00 per person
$500,000.00 aggregate bodily injury liability
$100,000.00 property damage liability
Proof of insurance coverage will be provided prior to the time the Equipment is delivered to us.
❑ Self Insurance. Pursuant to Section 16 of the Agreement,we are self-insured for:
❑ All risk, physical damage.
❑ Public liability.
Such self-insurance covers Siemens Public, Inc. and its assigns to the same extent that commercial
insurance would otherwise be required to do so by the Lease. We will provide proof of such self-
insurance in letter form together with a copy of the statute or other authority authorizing this form of
insurance.
LESSEE: CITY OF PORT ARTHUR,TEXAS
By:
Name: John Comeaux
Title: City Manager
Date: November_, 2014
LESSEE'S PAYMENT INSTRUCTIONS
Re: Leasing Schedule #280-0002481-001 dated November _, 2014 (the "Lease"), to Master Lease
Purchase Agreement dated November 22, 2013, between the City of Port Arthur, Texas, as lessee,
and Siemens Public, Inc., as lessor
Siemens Public, Inc.
3411 Silverside Road
Hanby Building, Suite 100
Wilmington, DE 19810
Ladies and Gentlemen:
The City of Port Arthur, Texas (the "Lessee"), hereby instructs Siemens Public, Inc. to disburse the following
amounts to the following parties in connection with the Lease:
1. $ to UMB Bank, N.A., as escrow agent, consisting of the proceeds of the Lease, to be
applied to finance the"Equipment"as described in the Lease, as follows:
Wire Instructions:
Bank Name: UMB Bank, N.A.
ABA Routing No.: 101000695
BNF Name: Trust Operations/CT-STL
BNF Acc: 9800006823
Reference: Siemens/Port Arthur, TX/D Wilson
Dated: November ,2014.
CITY OF PORT ARTHUR,TEXAS
By
Name: John Comeaux
Title: City Manager
SIEMENS
October 22,2014
City of Port Arthur,Texas
444 4th Street
Port Arthur,Texas 77641
Re: Leasing Schedule #280-0002481-001 dated November 10, 2014 (the "Lease") to
Master Lease Purchase Agreement dated as of November 22, 2013, between the
City of Port Arthur,Texas,as lessee,and Siemens Public,Inc.,as lessor
Ladies and Gentlemen:
Thank you for selecting Siemens Public, Inc. ("Siemens") as your lender. We are delivering this letter to
describe our role in the transaction.
Siemens has not acted and will not act as your agent or serve as your municipal advisor (as defined in
Section 15B of the Securities Exchange Act of 1934). We have no fiduciary duty to you and intend only
to enter into an arms-length transaction involving extending credit to you through the purchase of a lease
purchase agreement.
Any quote or indication of interest provided to you consists solely of the terms under which Siemens may
be willing to enter into a transaction with you for Siemens'own account.
Please acknowledge the foregoing by signing where indicated below and returning this letter via e-mail to
our counsel, Gilmore & Bell, P.C. (e-mail: jjackson a gilmorebell.com). In addition, please identify
below any registered municipal advisor, financial advisor or placement agent you are working with on
this transaction.
Please let us know if you or your counsel would like to further discuss these matters.Thank you again for
doing business with us. We look forward to working with you.
SIEMENS PUBLIC, INC.
❑ Placement Agent/Financial Advisor/
Registered Municipal Advisor:
(Name of Firm)
❑ No Placement Agent/Financial Advisor/Registered Municipal Advisor
Acknowledgement:
CITY OF PORT ARTHUR,TEXAS
By:
Name:
Title: