KERR COUNTY JUVENILE BOARD JUVENILE DETENTION FACILITY LEASE-PURCHASE $2,962,000.00 TRANSCRIPT OF PROCEEDINGS BICKERSTAFF, HEATH & SMILEY, L.L.P. INDEX Kerr County Juvenile Board Juvenile Detention Facility Lease-Purchase 1. Resolution of the Kerr County Juvenile Board, Approving, Ratifying and Confirming a Lease Providing for the Acquisition, Construction and Equipping of a Juvenile Detention Facility and Other Matters Relating Thereto dated March 30, 1994 _ 2. Order of the Commissioners Court of Kerr County Appointing the Kerr County Juvenile Board as Agent to Lease, Design, Finance, Construct and Operate a Secure Juvenile Probation Facility; Providing that the County Shall have no Financial Liability; Making _ Findings and Grants; and Providing for Other Matters Related Thereto dated March 30, 1994 _ 3. Resolution of the Commissioners Court of Kerr County Appointing the Kerr County Juvenile Board as its Agent to Execute Various Specific Documents in Connection with the Lease, Design, Finance, Construction and Operation of the Secure Juvenile Detention __ Facility; Making Findings and Grants and Providing for Other Matters Related Thereto dated July 12, 1994 -- 4. Resolution of the Kerr County Juvenile Board Approving Various Documents Relating to the Kerr County Juvenile Detention Facility, and Authorizing Board Members to Sign Same dated July 14, 1994 5. Resolution of the Kerr County Juvenile Board ("The Board") Appointing District Judge E. Karl Prohl and Kerr County Auditor Tommy Tomlinson as Agents of the Board for - Purposes of Executing Draw Requests as Appropriate for the Kerr County Juvenile Detention Facility dated July 14, 1994 -" 6. Resolution of the Kerr County Juvenile Board Approving the First Amendment to an Escrow Agreement Relating to the Kerr County Juvenile Facility dated July 14, 1994 7. Incumbency Certificate 8. Lease-Purchase Agreement 9. Assignment of Lease Agreement 10. Notice of Assignment and Request _ 11. Escrow Agreement 12. First Amendment to an Escrow Agreement Relating to the Kerr County Juvenile Facility 13. Essential Use and Source of Funds Certificate 14. Operation and Management Agreement 15. Operations Fund Agreement 16. Standard Form of Agreement Between Owner and Architect 17. Development Agreement 18. Warranty Deed 19. Deed of Trust Including Security Agreement and Financing Statement 20. ChiCorp Financial Services, Inc. letter to Kerr County, Texas _ 21. Opinion of Counsel for Lessee 22. Opinion of Bickerstaff, Heath & Smiley, L.L.P. 23. Financing Statements (2) - 24. No Arbitrage Certificate 25. IRS Form 8038-G 26. Title Policy A CERTIFICATE FOR A RESOLUTION OF THE KERB COUNTY JUVENILE BOARD APPROVING A LEASE, AN ASSIGNMENT, AND -' RESOLVING OTHER MATTERS RELATED TO A JUVENILE DETENTION' FACILITY I, the undersigned, secretary for the Ken County Juvenile Board, Texas, DO_ -HEREBY ~' CERTIFY as follows: _ 1. The Kerr County Juvenile Board (the "Board") convened in a special called meeting on March 30, 1994 at the regular meeting place in the Ken County Courthouse, Kerrville, Texas, and the roll was called of the duly constituted members of the Court, to wit: 198th-District Judge Emil Karl Prohl _ 216th-District Judge Stephen B. Ables County Judge W. G. (Bill) Stacy _ and all of such persons were present, except Stephen B. Ables, thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written A RESOLUTION OF THE KERR COUNTY JUVENILE BOARD APPROVING A LEASE, AN ASSIGNMENT AND RESOLVING OTHER - MATTERS RELATED TO A JUVENILE DETENTION FACILITY - (the "Resolution") was duly introduced for the consideration of the Board and read in full. It was then duly moved and seconded that the Resolution be adopted, and, after due discussion, said motion, carrying with it the adoption of the Resolution carried by the following votes: AYES: 2 NOES: 0 ABSTENTIONS : 0 2. A true and complete copy of the Resolution adopted at the meeting described in the above _ and foregoing paragraph is attached to and follows this certificate; the Resolution has been duly signed and attested by the proper officers and, as signed, has been duly recorded in the Board's minutes of said meeting; the above and foregoing paragraph is a true and complete excerpt from Ccrtifica[c for Rcsolution Page 1 the Board's minutes of said meeting; the above and foregoing paragraph is a true and complete excerpt from the Board's minutes of said meeting pertaining to the adoption of the Order; said -- meeting was open to the public as required by law; and written notice of the date, place, and subject of said meeting was given as required by the Open Meetings Act, Chapter 551, Texas Government Code. WITNESS MY HAND AND SEAL on this 30th day of March, 1994. ,. ,~ .. ~,- _ Secretary Kerr County Juvenile Board _. Certificate for Resolution Page 2 RESOLUTION OF THE KERB COUNTY JUVENILE BOARD, APPROVING, RATIFYING AND CONFIRMING A LEASE "-" PROVIDING FOR THE ACQUISITION, CONSTRUCTION AND EQUIPPING OF A JUVENILE DETENTION FACILITY AND OTHER MATTERS RELATING THERETO WHEREAS, the Commissioners Court of Kerr County (the "Court") has found the - immediate acquisition, purchase and construction of a secure residential juvenile detention facility (the "Juvenile Detention Facility" or "Facility") and the operation thereof is necessary - to preserve and protect the public health and safety of the citizens of Ken County, Texas (the "County"); _ WHEREAS, the Kerr County Juvenile Board (the "Board"), as created and constituted pursuant to the provisions of §152.1391 of the Texas Human Resources Code, was appointed by the Court as the agent of the Court and the County, pursuant to §262.001, Texas Local _ Government Code, to obtain and acquire a secure juvenile detention facility; WHEREAS, there is an immediate need. and public necessity for the financing, design _ and construction of the Facility to protect the public health, safety and welfare; WHEREAS, the Texas Juvenile Probation Commission ("TJPC") has promulgated rules - that authorize the use of TJPC Community Corrections Program funds for juvenile residential services; - WHEREAS, the TJPC provides funds from State appropriations to local Juvenile Probation Boards for Fiscal Year 1994; and - WHEREAS, the Board has requested that TJPC permit it to use part of its allocated TJPC Community Corrections Funds for purposes of providing residential services pursuant to the terms of the attached Lease-Purchase Agreement (the "Lease"); and WHEREAS, the TJPC has approved the Board's plan and the use of such funds to provide residential services pursuant to the Lease; WHEREAS, the District is in compliance with the rules of the TJPC and is eligible to receive and will be certified to the Comptroller for receipt of TJPC Community Corrections _ Funds; and _ WHEREAS, to the extent that the Legislature continues to appropriate funds for the Community Corrections Program the TJPC will allocate those funds to the Board pursuant to state law; NOW, THEREFORE, BE IT RESOLVED BY THE KERB COUNTY JUVENILE BOARD THAT: 1. Findings. The recitations hereinabove are found to be true and correct, are incorporated herein as findings of fact, and the Board hereby: (a) grants an - exemption, pursuant to § 262.024(a)(2), Local Government Code, for the ' acquisition of the Juvenile Detention Facility; and (b) formally accepts the Court's appointment of the Board, pursuant to § 262.001, Local Government Code, as the _ County's agent to obtain and contract for the design, financing, construction and operation of the Facility. _ 2. Acquisition of Facility. All previous actions by the Board, with respect to the Lease, the §262.024(a)(2) exemption, the § 262.001 appointment, the acquisition, - financing, construction, equipping or operation of the Juvenile Detention Facility, are hereby ratified and approved and the immediate acquisition of the Facility is found necessary to preserve and protect the public safety and health of the youth _ and citizens of Ken County. 3. Approval of the Lease. The Lease, between ReCor, Inc. and the Board, as _ agent for the County, spread on the minutes of this meeting, is hereby approved, confirmed and ratified and may be executed and deliverd. _ 4. Approval of Documents. The form and substance of the financing documents spread on the minutes of this meeting of the Board are hereby approved and the Chairman, Chief Juvenile Probation Officer and/or Judge of the 198th Judicial - District are hereby authorized to execute and deliver such documents. 5. Authority of Chair, etc.. The Board hereby authorizes the Chairman of the - Board, the Chief Juvenile Probation Officer and/or the Judge of the 198th Judicial District to (a) sign, execute, certify, verify, acknowledge, deliver, accept, file and record (as appropriate) the Lease, the Escrow Agreement, Notice of Assignment -- and other instruments and documents spread on the minutes of this meeting and requiring signature by the Board, and (b) to deliver, or cause to be delivered, any and all such documents; provided that this Resolution shall never be interpreted - as creating a .debt or liability of the County or the Board; provided that, notwithstanding any term or provision herein or in the attached exhibits and documents to the contrary, neither Kerr County nor the Board shall be responsible - for the payment of any principal, interest or Rental Payments due or to become due with respect to the Lease, or the attached exhibits and documents, nor any other expense, fee, sum or amount except as to revenues received for the housing _ of persons in the Facility, and appropriations made to and received by the Board, as agent for Kerr County, or otherwise, from TJPC or any other governmental entity. Kerr County Juvenile Board - Resolution -2- 6. Ratification of Actions. All actions heretofore taken by the Board, and all things done by the members of the Board, and the County Commissioners, pursuant to ~-- their official authority, with respect to the transaction contemplated hereby, be and the same are hereby ratified, approved and adopted as the acts of the Board. -' 7. Lease as Special Obligation. The Lease shall be a special obligation payable solely as set forth therein, and the Lessor, and any assignees or successors of the Lessor, shall never have the right to demand payment thereof out of funds raised "' or to be raised by taxation. 8. Designation as Qualified Tax-Exempt Obligation. The Board hereby designate _ the Lease as a "qualified tax-exempt obligation" as defined in the Internal Revenue Code of 1986, as amended (the "Code"). _ 9. ~rther Procedures. The appropriate officers, employees, agents and representatives of the Board shall be and are hereby expressly authorized, _ empowered and directed, from time to time, to do and perform all such acts and things and to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the Board, as agent for the County, certificates _ and certifications, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Order and of the Lease. 10. Effective Date. This Resolution shall be in force and effect from and after its passage on this date. 11. Open Meetings. It is hereby officially found and determined that this meeting was open to the public, and public notice of the time, place and purpose of said -- meeting was given, all as required by the Open Meetings Act, Chapter 551, Texas Government Code. . - ADOPTED AND PASSED this the 30th day of March, 1994. .~~~ ~~~r ~~ William G. Stacy, County Judge - Attest: _ ~ `~ ~ . stricttCounty,Cle7. ;~Ex- fficd~o Clerk of the Kerr County Eomi~'ssioners Court - •- u Kerr Ceunty. Juvenile Boarc~~ ._ ~ CERTIFICATE FOR AN ORDER OF THE COMMISSIONERS COURT' OF RERR COUNTY APPOINTING THE KERR COUNTY J[JVENlLE BOARD - AS AGENT TO LEASE, DESIGN~FIN~.~NCE, CONSTRUCT AND OPERATE A SECURE JUVENILE PROBATION FACILITY; PROVIDING _ THAT TIC COUNTX SHALL HAVE NCl FINANCIAL LIABILITY; MAKING FINDINGS AND GRANTS; AND FROVIDING FOR OTHER M~.TTERS RELATED THERETO. ~ :: - ~~ Z, the undersigned, County Clerk and Ex-Officio Clerk of the Coxbmissioners Court of - Kerr County, Texas, I?O HEREBY CERTIFY as foll-o~as: 1. The Comxnissiozters Court of err County, Teas (the "Court") convened in a - [regularlspecial) meeting on the, day of , 199 at'the regular meeting place in the County Courthouse, Ke:nrville, Texas, and the roll was.-called 6f the duly constituted members of the Court, to wit: County Judge W. G. (Bill~tacy Commissioner, Precinct 1 Ray Liman Commissioner, Precinct 2 T~>~ c~~y Coz~annissioner, Precinct 3 Glenn K. H.olekamp Cozn~issioner, Precinct 4 Bruce Oehler - ~~ and all of such persons were present, except _ ,thus constituting a quorum. Whereupon, among other business, the following was transacted at the meeting: a written AN ORDER OF THE COMMISSIONERS EOURT OF KERB COUNTY .._ APPOINTA~TG THE KERB COUNTY JUVENII,E BOARD AS AGENT TO LEASE, DESIGN, FINANCE, CONSTRUCT AND OPERATE A SECURE JUVENILE PROBATION FACILITX; PROVIDING THAW THE COUNTX __ SOALL HAVE NO FINANCIAL LI,A-BILITI'; MAKIlVG FINDINGS ANA GRANTS; AND PROVxAING FOR OTHER MATTERS REL,A-.TED THERETO. (the "Order") was duly introduced fox the consideration of the Court and read in full, It was then duly moved and seconded that the Order be adopted, and, after due discussion, said motion, - carrying with it the adoption of the Order, carried by the followiz~.g votes: YES: 5 NOES: d -- -... ,P~BSTENTIONS: ~ 2. A true and complete copy of the Order adopted at the meeting described in the above and foregoing paragraph is attached to and follows this certificate; the Order has been "° duly signed and attested by the proper officers and, as signed, has been duly recorded in the Court's minutes of said meeting; the above and foregoing paragraph is a true and complete excerpt from the Court's minutes of said meeting pertaining to the adoption of the Order; said meeting was open to the public as required by law; and written notice of the date, place, and subject of said meeting was given as required by Open Meetings Act, Chapter 551, Texas Government Code. W~~'NESS MY HAND and the SEAL of the COURT this ~ day of _ l ( ~ , 199; ~;~;., , ~ .cam Co ry Clerk and Ex-O cio Clerk of the Commissioners Court of Kerr County, Texas (Comm. Crt. Seal) 2 AN ORDER OF THE COMMISSIONERS COURT OF KERB COUNTY APPOINTING THE KERB COUNTY JUVENILE BOARD _ AS AGENT TO LEASE, DESIGN, FINANCE, CONSTRUCT AND OPERATE A SECURE JUVENILE PROBATION FACILITY; PROVIDING THAT THE COUNTY SHALL HAVE NO FINANCIAL - LIABILITY; MAKING FINDINGS AND GRANTS; AND PROVIDING FOR OTHER MATTERS RELATED THERETO. WHEREAS, the Commissioners Court of Kerr County ("the Commissioners Court") - finds that the immediate acquisition, purchase and construction of a secure residential juvenile detention facility (the "Juvenile Detention Facility" or "Facility") and the operation thereof is necessary to preserve and protect the public health and safety of the citizens of Kerr County; and WHEREAS, since the Legislature created the Kerr County Juvenile Board (the "Board"), pursuant to §152.1391, Texas Human Resources Code, the Commissioners Court and the Board - (jointly "the County") have worked to provide juvenile probation services; and WHEREAS, the Legislature has appropriated funds to the Texas Juvenile Probation - Commission ("TJPC") which has promulgated rules that authorize the use of TJPC Community Corrections Program funds for juvenile residential services; and WHEREAS, the acquisition of the Facility by lease-purchase on the terms set forth in the Lease-Purchase Agreement before this Court is advisable and in the best interest of the citizens of Kerr County, Texas; and WHEREAS, the source of funds for meeting the obligations under the Lease-Purchase _ Agreement is to be revenues actually received for housing residents/juvenile detainees at the Facility, and from appropriations, if any, received from the Texas Juvenile Probation Commission for the express purpose of paying the obligations under the Lease-Purchase - Agreement. - NOW, THEREFORE, BE IT ORDERED BY THE COMMISSIONERS COURT THAT: 1. Findings. The recitations hereinabove are found to be true and correct, are - incorporated herein as findings of fact, and the Commissioners Court hereby: (a) grants an exemption, pursuant to § 262.024(a)(2), Local Government Code, for the acquisition of the Juvenile Detention Facility; and (b) appoints the Board, - pursuant to § 262.001, Local Government Code, as its agent to obtain and contract for the design, financing, construction and operation of the Facility. 2. Acquisition of Facility. All previous actions by the County Commissioners, with - respect to the Lease, the §262.024(a)(2) exemption, the § 262.001 appointment, the acquisition, financing, construction, equipping or operation of the Juvenile Detention Facility, are hereby ratified and approved and the acquisition and lease - of the Juvenile Detention Facility is found to be necessary to preserve and protect the public safety and health of the youth and citizens of Ken County. - 3. Apuroval of the Lease. The Lease, between ReCor, Inc. and the Board, as agent for the County, spread on the minutes of this meeting, is hereby approved, confirmed and ratified and the Board is hereby authorized to exercise its - discretion and judgment and to execute and deliver the Lease. 4. Auproval of Documents. The form and substance of the financing documents - spread on the minutes of this meeting of the Commissioners Court are hereby approved and the Board is hereby authorized to execute and deliver such documents and to do all things necessary or advisable and in the best interests of _ the County to consummate the transaction described therein. 5. Authority of Board. The Board is hereby authorized to (a) sign, execute, certify, verify, acknowledge, deliver, accept, file and record any and all instruments and documents, and (b) take, or cause to be taken, any and all such action, in the name and on behalf of the Board and Kerr County or otherwise, as in the Board's judgment is necessary, desirable or appropriate in order to consummate the transactions contemplated by or otherwise to effect the purposes _ of the foregoing documents including the approval of minor corrections and non- substantive changes to the wording and language of the attached documents as may be reasonably required and that are not material; provided that this Order shall never be interpreted as creating, and the Board is not authorized to create, any debt or liability of Kerr County; and provided that, notwithstanding any term or provision herein or in the attached exhibits and documents to the contrary, _ Kerr County shall not be responsible for the payment of any principal, interest or Rental Payments due or to become due with respect to the Lease, or the attached exhibits and documents, nor any other expense, fee, sum or amount - except as appropriated by the TJPC for that purpose or received as revenues for the housing of persons in the Facility pursuant to Interlocal Contract. -2- 6. Ratification of Actions. All actions heretofore taken by the Commissioners Court, and all things done by the members of the Board, the County Judge and - the County Commissioners, pursuant to their official authority, with respect to the transaction contemplated hereby, be and the same are hereby ratified, approved and adopted as the acts of the Commissioners Court. 7. Lease as Special Obligation. The Lease shall be a special obligation payable _ solely as set forth therein, and the Lessor, and any assignees or successors of the Lessor, shall never have the right to demand payment thereof out of funds raised or to be raised by taxation. 8. Designation as Qualified Tax-Exempt Obligation. The Commissioners Court hereby designates, and authorizes the Board to designate, the Lease as a "qualified tax-exempt obligation" as defined in the Internal Revenue Code of 1986, as amended (the "Code"). _ 9. Further Procedures. The appropriate officers, employees, agents and representatives of the Board shall be and are hereby expressly authorized, empowered and directed, from time to time, to do and perform all such acts and _ things and to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the County all such instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the - terms and provisions of this Order and of the Lease. 10. Effective Date. This Order shall be in force and effect from and after its passage on the date shown below. 11. Open Meetings. It is hereby officially found and determined that this meeting - was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by the Open Meetings Act, Chapter 551, Texas Government Code. ADOPTED AND PASSED this the 30th day of March, 1993. ., William G. Stacy, County Judge Attest:-. ~, - i _ C my Clerlf,> ~- ~ icio Cferk ~f the Kerr County Commissioners Court :.P,~ .1~,,~ ~ ~ ,,,~~ _ ,.. ~ -3- A RESOLUTION OF THE COMNIISSIONERS COURT OF KERR COUNTY APPOINTING THE KERB COUNTY JUVENII.E BOARD AS ITS - AGENT TO EXECUTE VARIOUS SPECIFIC DOCUMENTS IN CONNECTION WITH THE LEASE, DESIGN, FINANCE, CONSTRUCTION AND OPERATION OF THE SECURE JUVENILE - DETENTION FACILITY; MAKING FINDINGS AND GRANTS AND PROVIDING FOR OTHER MATTERS RELATED THERETO. WHEREAS, the Commissioners' Court of Ken County ("the Commissioners Court") .__ hereby affirms its conclusion that the immediate acquisition, purchase, construction and operation upon completion of a secure residential juvenile detention facility ("Facility") and the operation thereof is necessary to preserve and protect the public health and safety of the citizens _ of Kerr County; and WHEREAS the Commissioners' Court has previously delegated to the Kerr County - Juvenile Board ("the Board") the authority to execute and deliver the Lease and other financing documents related to or necessary to achieve this end; and WHEREAS the Commissioners Court recognizes that various specific documents remain to be executed to implement the acquisition, purchase, construction and operation upon completion of the Facility, including, but not necessarily limited to: (1) Operation and - Management Agreement; (2) Operations Fund Agreement; (3) First Amendment to the Escrow Agreement relating to the Facility; (4) Development Agreement; and (5) Amendment to the Architect's Agreement with ReCor; NOW THEREFORE, BE IT RESOLVED BY THE CONIlVIISSIONERS COURT THAT: - 1. Findings and Authority of the Board: (a) The Commissioners Court hereby approves the form and substance of the documents referred to above and submitted to the Commissioners Court - on July 12, 1994; the final executed versions of which will be placed in the Commissioners Court's records along with this Order. (b) The recitations hereinabove are found to be true and correct, are incorporated herein as findings of fact, and the Commissioners Court _ hereby (i) reaffirms its earlier grant of an exemption, pursuant to §262.024(a)(2), Local Government Code, for the acquisition of the Facility; and (ii) specifically appoints and authorizes the Board to act as _ its agent for the purpose of executing all necessary documents, including the documents referred to above, and to make minor modifications to said documents, as the Board deems necessary. (c) The appropriate officers, employees, agents and representatives of the Board shall be and are hereby expressly authorized, empowered and _ directed, from time to time, to do and perform all such acts and things and to execute, acknowledge and deliver in the name and under the _ corporate seal and on behalf of the County all such instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Order. 2. Effective Date: This Order shall be in Force and effect from and after its passage on the date _ shown below. 3. Open Meetings: _ It is hereby officially found and determined that this meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by the Open Meetings Act, Chapter 551, Texas Government _ Code. AD0~1'ED[ A~TD PASSED this ~ day of July, 1994. .r _ ~ ~~" - ~ C . _ ;~,. ' -- --~ - WILLIAM G. STACY, County Judge . .~ y ~~ , ,~.. ~~ittest:.. •,~ ~ >> - i -c___ County Clerk, Ex-Officio r of the Kerr County Commissioners Court A RESOLUTION OF THE KERB COUNTY JUVENILE BOARD - APPROVING VARIOUS DOCiJMENT5 RELATING TO THE KERB COUNTY JUVENILE DETENTION FACII.ITY, AND AUTHORIZING BOARD MEMBERS TO SIGN SAME. - WHEREAS, the Commissioners' Court of Ken County ("the Commissioners Court") has affirmed its previous conclusion that the immediate acquisition, purchase, construction and operation upon completion of a secure residential juvenile detention facility ("Facility") is -' necessary to preserve and protect the public health and safety of the citizens of Ken County; and WHEREAS the Commissioners' Court has specifically delegated to the Ken County -` Juvenile Board ("the Board") the authority to do and perform all such acts and things and to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the _ County all instruments necessary to implement acquisition, purchase, construction and/or operation of the Facility; and _ WHEREAS the Board expressly finds that at this time it is necessary and desirable to execute the following documents on order to implement the stated purpose of the Commissioners Court: (1) Operation and Management Agreement; (2) Operations Fund Agreement; (3) _ Development Agreement; and (4) No Arbitrage Certificate; _ NOW THEREFORE, BE IT RESOLVED BY THE KERR COUNTY JUVENILE BOARD THAT: 1. Findings: The following documents, originals of which are attached hereto and incorporated - herein by reference, are hereby approved and accepted: (1) Operation and Management Agreement; (2) Operations Fund Agreement; (3) Development Agreement; and (4) No Arbitrage Certificate; 2. Authorization of Signatures: The Chairman of this Board, or any other member of this Board, and the Chief -- Juvenile Probation Officer are hereby authorized to approve said documents, and to sign, execute, certify, verify, acknowledge and deliver such documents, including draw requests; 3. Effective Date: This Resolution shall be in force and effect from and after its passage; and 4. Qpen Meeting: It is hereby officially found and determined that this meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by the Open Meetings Act, Chapter 551, Texas Government Code. ADOPTED AND PASSED this day of July, 1994. Kerr County Juvenile Board s ~- v ~ C_ WII,LIAM G. STACY, ounty Judge Attest: County Clerk, Ex-Officio C of _ the Kerr County Commissioners Court . ,~ f: r ~ - '~~ ~ ~ .~ ~.~, ~> J`, ~"`-. Simon J. Hams, Chief Juvenile Probation Officer 2 A RESOLUTION OF THE KERR COUNTY ~E BOARD ("THE •-- BOARD") APPOINTING DISTRICT JUDGE E. KARL PROHL AND KERB COUNTY AUDITOR TOMMY TOMLINSON AS AGENTS OF THE BOARD FOR PURPOSES OF EXECUTING DRAW REQUESTS AS -° APPROPRIATE FOR THE KERB COUNTY JUVENILE DETENTION FACII,ITY WHEREAS the Ken County Commissioners' Court has specifically delegated to the _ Ken County Juvenile Board ("the Board") the authority to do and perform all necessary acts and things and to execute, acknowledge and deliver in the name and under the corporate seal and on behalf of the County all instruments necessary to implement acquisition, purchase, construction and/or operation of the Facility; and WHEREAS the Board finds that all necessary documents have been signed to permit the process of final design and construction to take place; and WHEREAS the Board recognizes that during this period of design and construction there will be numerous requests for release of funds from the escrow agreement, and that it would be impractical for the Board to meet each time that a decision must be made with respect to a draw _ request; NOW THEREFORE, BE IT RESOLVED BY THE KERR COUNTY JUVENIIE BOARD THAT: 1. Authorization of Signatures: 198th Judicial District Court Judge E. Karl Prohl and the Ken County Auditor are hereby authorized to review, approve and execute each payment request on behalf of the Board without prior explicit approval by the entire Board, provided that no payment request will be considered as approved for release of funds until and unless both Judge Prohl's and Mr. Tomlinson's signatures appear thereon, signifying their review and approval of said payment request(s) pursuant to the terms and conditions of the various agreements between the parties (ChiCorp, ReCor, Inc., and Ken County). 2. Effective Date: This Resolution shall be in force and effect from and after its passage; and 3. Open Meeting: It is hereby officially found and determined that this meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by the Open Meetings Act, Chapter 551, Texas Government Code. ADOPTED AND PASSED this day of July, 1994. ' ' l ,~~' ~ , _. ' ~ ~ ~~ k tF. f f~ . ~ . A'ttest:~ - ~~~~ ,~' County Clerk, Ex-Officio C rk of _ the Ken County Commissioners Court Kerr County Juvenile Board WILLIAM G. STACY, County Judge Simon J. Hams, Chief Juvenile Probation Officer 2 (j RESOLUTION OF THE KERB COUNTY JUVENII,E BOARD APPROVING THE FIRST AMENDMENT TO AN ESCROW - AGREEMENT RELATING TO THE KERB COUNTY JUVENII,E FACILITY WHEREAS, other counties and juvenile boards have expressed intent to place juveniles in the proposed Ken County Juvenile Facility but are not prepared to encumber funds and contract for beds prior to the substantial completion, or the start of construction of the Facility; WHEREAS, the Escrow Agreement Relating to the Kerr County Juvenile Facility, dated - as of March 31, 1994, should be amended to permit construction to begin as soon as possible; _ WHEREAS, the Commissioners Court of Kerr County has approved an amendment to the Escrow Agreement and authorized this Board to approve and cause the execution of the Amendment; NOW, THEREFORE, BE IT RESOLVED BY THE KERB COUNTY JUVENII.E BOARD: _ 1. That the First Amendment to the Escrow Agreement Relating to the Kerr County Juvenile Facility, dated as of March 31, 1994 ("First Amendment"), attached hereto and incorporated herein by referenced is hereby approved and accepted. 2. That the Chairman of this Board, or any other member of this Board, and the Chief Juvenile Probation Officer are hereby authorized to approve said First Amendment and - to sign, execute, certify, verify, acknowledge and deliver such Amendment Number One. 3. This Resolution shall be in force and effect from and after its passage. 4. It is hereby officially found and determined that this meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by - the Open Meetings Act, Chapter 551, Texas Government Code. ,, + ~' ~ , 199 ADOPTED AND PASSED this the day of . ` ~ ~ -' 1 z f ,, -. ; ', J ,~__..._ ~ ~ _ -f.. Kerr County.Juvenile Board 1 ,~' 1 E ~ ~'~ ~ ~~ William G. Stacy, airman .... _ ,. _- ~~ _ - / - ~ _ ~ ~.J tee-- -~~ ~r7,cu~ County Clerk, Ex-Officio erk of Simon J. Harris, Chief Juvenile _ the Kerr County Juvenile Board Probation Officer STATE OF TEXAS § -- KERB COUNTY § INCUMBENCY CERTIFICATE - I, Emil Karl Prohl, Judge of the 198th Judicial District, do hereby certify that I am a duly elected or appointed and acting member of the board of the Kerr County Juvenile Board, - an agency, political subdivision or governmental entity of the State of Texas, that I have access to and shared authority and control over the records of such entity, and that as of the date hereof, the individuals named below are the duly elected or appointed officers of such entity holding the offices set forth opposite their respective names. I further certify that (i) the signatures set opposite their respective names and titles are their true and authentic signatures, and (ii) such officers have the authority on behalf of such entity to enter into that certain Lease - dated as of March 31, 1994 between such entity and ReCor, Inc. NAME TITLE r SIGN TURE - William G. Stacy, Chairman of the Board h ~ , ~ '~" `~- E~'`t~ County Judge Simon J. Harris Chief Juvenile Probation Officer ~~-y-~ - w~-~-~ IN WITNESS WHEREOF, I have duly executed this certificate and affixed the seal of - such entity hereto this 30th day of March, 1994. Name: Emil Karl Prohl _ Title: Judge, 198th Judicial District 7 STATE OF TEXAS § _ § COUNTY OF KERB § LEASE -PURCHASE AGREEMENT - This Lease -Purchase Agreement (the "Lease") is made and entered into as of the 31st day of March, 1994, by and between ReCor, Inc., a Texas corporation, (the "Lessor") and the - Kerr County Juvenile Board, as agent for Kerr County, Texas, a unit, agency, governmental entity or political subdivision of the State of Texas, (the "Lessee"). Article 1. Demise, Description, Use and Term - Section 1.1 Lease of Facility. Lessor hereby leases to Lessee, and Lessee hereby takes and rents from Lessor, that certain property situated in Ken County, Texas (the "County") and more particularly described in Exhibit "A" hereto (the "Leased Premises"), to be used for a secure - juvenile detention facility (the "Facility") as Lessee, in its discretion determines. Section 1.2 Term of Lease. The term of this Lease shall be for a period of fifteen (15) - years from the Effective Date described in Section 2.2 below (the "Term"). At the end of said Term, Lessee may, at its option, renew this Lease on terms and rents to be negotiated. Article 2. Rentals Section 2.1 Monthlx Rental Payments. Lessee agrees to and shall pay Lessor at Kerr County, Texas, or at such other location as directed, 180 rental payments in the amount of Twenryseven Thousand Nine Hundred Sixty-Five and 49/100 Dollars ($27,965.49) per month as rent (the "Rental Payments"). Any Rental Payment may be paid in advance at the discretion of Lessee. Section 2.2 Rental Commencement. Rental Payments shall commence on the first day of the calendar month, and become due and payable on the first day of each calendar month _ thereafter during the Term of this Lease, after the earlier to occur of (i) the occupancy of the Facility after the issuance of a Certificate of Occupancy for the Facility, (ii) the delivery to Lessee of a certification by an architect selected by Lessee and Lessor and licensed by the State of Texas of substantial completion of the Facility, or (iii) the first payment date set forth and provided in the "Amortization Schedule & Purchase Option" attached hereto as Exhibit "B" and incorporated herein for all purposes (the "Effective Date"). Section 2.3 Rental Payments Unconditional -Exceptions Except as otherwise provided in Section 7.1 or Section 17.5 below, the obligations of Lessee to make the Rental Payments - required under this Lease shall be absolute and unconditional and shall not be subject to diminution by set-off, counterclaim, abatement or otherwise; and until such time as all the Rental Payments have been made, Lessee: (a) will not suspend or discontinue, or permit the suspension or discontinuance of any _ payment provided for in this Article 2; (b) 'will perform and observe all of its other agreements contained in this Lease; and (c) will not terminate this Lease for any cause, including without limiting the generality and specifications thereof, any acts or circumstances that may constitute _ failure of consideration, destruction of or damage to the Leased Premises, commercial frustration of purpose, any change in tax or other laws or administrative rulings of or administrative actions by the United States of America _ or the State of Texas or any political subdivision of either, or any failure of the Lessor to perform or observe any agreement, whether express or implied, or any duty, liability or obligation arising out of or in connection with this Lease. Section 2.4 No Abatement or Set-Off. Except as otherwise provided in Sections 7.1 or 17.5, there shall be no abatement or reduction of Rental Payments or any other payment required - hereunder for any reason notwithstanding any dispute between the Lessee and Lessor, or their respective assigns, or any engineer, contractor or vendor of the Leased Premises, or any other person. Lessee shall make all payments of Rental Payments and other payments due hereunder when due, and shall not withhold any Rental Payments or other payments due hereunder pending final resolution of such dispute, nor shall the Lessee assert any right of set-off or counterclaim against its obligation to make such payments required under this Lease. Section 2.5 Default by Lessee. As provided in Section 17.5, all the obligations of Lessee pursuant to this Lease are subject to the provisions of Section 17.5. Save and except as provided - in Sections 7.1 and 17.5, if Lessee defaults in the payment of any Rental Payment hereunder, subject to the terms of this Section 2.5 such Rental Payment shall bear •interest at the most recent rate published by the Consumer Credit Commissioner of the State of Texas in the Texas Register at the time of default. In no event shall such interest rate be less than ten percent (10%) per annum or exceed twenty percent (20 %) per annum and in no event shall the interest rate charged _ exceed the maximum rate allowable by applicable state and federal law. Said interest rate shall be assessed on the unpaid balance from the date it is due until actually paid. In like manner, all other obligations, benefits, and monies which may become due to Lessor from Lessee under _ the terms hereof, or which are paid by Lessor because of Lessee's default hereunder, shall bear interest as described above. Said interest shall accrue from the date due until paid, or as to sums paid by the Lessor because of Lessee's default hereunder, from the date such payments are made _ by Lessor until the date Lessor is reimbursed by Lessee therefor. Section 2.6 Assignment by Lessor. Lessee acknowledges that Lessor has assigned the _ Rental Payments to ChiCorp Financial Services, Inc. (the "Assignee") at the following address: Kerr County Juvenile Board "' Lease-Purchase Agreement 2 Chicorp Financial Services, Inc. _ 208 South LaSalle St. Chicago, Illinois 60604 Attention: Ramona Regas, Vice President ^ The Assignee has, by providing the funds for the construction of the Leased Premises, discharged alI of its obligations under the Lease. Upon further assignment of Assignee's interest _ herein, Assignee will cause written notice of such assignment to be sent to Lessee which notice will be sufficient if it discloses the name of the assignee and address to which further payments hereunder should be made. In compliance with Section 149(a) of the Internal Revenue Code of _ 1986, amended (the "Code"), Lessee hereby designates the Assignee to be its agent for the purposes of maintaining a book entry system identifying the ownership of interests in and to this Lease and the Assignee hereby accepts its duties as agent hereunder. The Assignee shall have and enjoy all the rights but not the duties of Lessor pursuant to this Lease. Section 2.7 Lessor Failure to Perform. In the event Lessor fails to perform any of its - obligations under this Lease the Lessee shall promptly notify Lessor and Assignee in writing, stating the details of the Lessor's failure to perform. Notwithstanding Lessor's failure to perform, Lessee agrees to pay directly to Assignee the Rental Payments, as set forth in Section - 2.1, on each and every Rental Payment date. Article 3. Taxes and Assessments Section 3.1 Taxes. In addition to the foregoing sums, Lessee shall, as further consideration for this Lease, pay and discharge all ad valorem taxes, general and special assessments, and other charges of every description which during the Term of this Lease may be levied on or assessed against the Leased Premises, including all interests therein, improvements thereto, or _ property thereon, whether belonging to Lessor or Lessee or to which either of them may become liable in relation thereto. Section 3.2 Timely Payment by Lessee. Lessee agrees to and shall pay all the foregoing ad valorem taxes, if any, assessments and charges not less than twenty (20) days prior to the delinquency thereof, and give written notice of such to Lessor within five (5) days after such _ payment is made. _ Section 3.3 Advance by Lessor. If Lessee fails to pay any such ad valorem taxes or assessments or fails to give written notice of any payment thereof at least ten (10) days prior to the time the same becomes delinquent, Lessor may, at its option, at any time within or after such _ ten (10) day period, pay any ad valorem taxes or assessments, together with all penalties and interest which may have been added thereto. Any such amount so paid by Lessor shall become immediately due and payable by Lessee to Lessor, together with interest thereon at the rate and _ manner as described in Section 2.5 hereinabove. Any such payment which Lessor may make Kerr County Juvenile Board "- Lease-Purchase Agreement 3 pursuant to this Section 3.3 shall not constitute a waiver of any rights which Lessor may have _ under the provisions of this Lease or as provided by law. Section 3.4 Tax Exemption. Notwithstanding anything to the contrary in this Article 3, the _ Lessee and Lessor agree the Leased Premises are exempt from taxation in accordance with the laws of the State of Texas, and that Lessee shall have the full right to administratively or judicially challenge any tax or assessment levied or attempted to be levied on the Leased _ Premises. Save and except to the extent it becomes necessary to pay any tax or assessment to protect the property and security interests of the Lessee, Lessor and Assignee, the Lessee may, in its sole discretion, elect not to pay any tax or assessment until such time as the tax or _ assessment is determined to be due and owing on the Leased Premises by a final judgment issued by a court of competent jurisdiction. Article 4. Insurance - Section 4.1 Casualty & Rental Insurance. Lessee agrees to and shall, within ten (10) days prior to Lessee's occupancy of the Leased Premises, secure from a good and responsible company or companies doing insurance business in the State of Texas, and maintain during the - entire Term of this Lease, the following coverages: (a) A policy or policies of insurance issued by and binding upon the insurance - company, insuring the Leased Premises against all risk of direct physical loss in an amount equal to no less than the greater of (i) the amount shown in the stipulated loss value column shown in Exhibit "B" attached to this Lease and - incorporated herein for all purposes, or (ii) eighty percent (80 %) of the full replacement cost of the Leased Premises, as of the date of the loss; and - (b) An insurance policy or policies issued by and binding upon the insurance company, insuring against the interruption of Rental Payments, under any and all circumstances save and except those set forth in Section 17.5; and (c) If the Lessee fails to secure or maintain the foregoing insurance, Lessor shall be permitted to obtain such insurance on Lessee's behalf and shall be compensated - by the Lessee for the cost of the insurance so incurred by Lessor. _ Section 4.2 Liability & Additions Insurance . Lessee agrees that, at all times during the Term of this Lease, Lessee shall: _ (a) Keep the Leased Premises, Lessee and Lessor insured against liability for personal injuries, death or property damages arising or in any manner occasioned by the acts of negligence of the Lessee, or others in its custody, in the operation Kerr County Juvenile Board Lease-Purchase Agreement 4 or use of the Leased Premises, for an amount reasonably satisfactory to Lessee _ and approved by Lessor; and (b) Be responsible for providing insurance for improvements it makes to the Leased _ Premises or personal property of Lessee placed upon the Leased Premises; and (c) ' If the Lessee fails to secure or maintain the foregoing insurance, Lessor shall be _ permitted to obtain such insurance on Lessee's behalf and shall be compensated by the Lessee for the cost of the insurance so incurred by Lessor. Section 4.3 Additional Requirements. All insurance policies required under the provisions of this Article 4 shall include the Lessee, Assignee and Lessor as an insured or additional insured, and shall provide that such parties may, although additional insureds, recover for any covered loss suffered by reason of Lessee's negligence. All policies provided for in this Article 4 shall be in such form, with such companies, and with such loss payable clauses as shall be approved by Lessor, which approval Lessor agrees not to unreasonably withhold. Certified copies of the polices provided for herein, or certificates of insurance evidencing the policy provided for herein, shall be delivered to Lessor, Assignee and Lessee, as applicable, on or before the Effective Date. All policies provided for in this Article 4 shall certify that the policy may not be canceled or altered without forty-five (45) days prior written notice to Lessor, and shall contain the insured's written obligation to notify Lessor, in writing, of any delinquency in premium payments at least forty-five (45) days prior to any cancellation or modification of any policy. All deductibles, if any, under any such insurance policies shall be subject to the prior approval of Lessor and all certificates delivered to Lessor shall specify the limits of the policy and all deductibles thereunder. Article 5. Exterior Maintenance Section 5.1 Exterior Maintenance. Except as otherwise provided •in this Section 5.1 and in _ Section 6.1, Lessee shall be obligated to, at its own expense, maintain the roof, foundation, all outside utilities and the structural soundness of the Facility in good repair and condition, except for reasonable wear and tear. Lessee further agrees to repair and/or replace components of the Facility that may be damaged due to neglect or any structural defect. Under this Lease it is _ recognized that for one year following the Effective Date, all product defects and workmanship are covered under contractor's warranties, and limited warranties on air conditioning _ compressors have been granted by contractors for five (5) years following the Effective Date. Lessor has the obligation to show proof of warranties covering product components and workmanship for one (1) year following the Effective Date. Lessor may give notice to Lessee _ of the need for repairs and corrections and Lessee shall proceed promptly to make such repairs and corrections. Kerr County Juvenile Board -' Lease-Purchase Agreement 5 Article 6. Interior Maintenance Section 6.1 Interior Maintenance. Lessee shall, at its own expense and risk, maintain all _ interior walls and ceilings of the Facility and also all interior windows, window glass, doors, electrical fixtures, and plumbing fixtures in good repair and condition. Lessee shall paint all interior walls~as required. Lessee shall furnish and regularly replace furnace filters consistent _ with heating/air conditioning systems manufacturer specifications. Usual janitorial and maintenance service, including sweeping and waxing of floors, vacuuming, trash collection and disposal, the cleaning of windows, dusting, and the replacement of light bulbs or fluorescent _ tubes in the light fixtures will be the responsibility of Lessee. Lessee shall maintain all grounds including, but not limited to, mowing, trimming, watering of plants and lawn as to maintain a good cosmetic look to the grounds. All maintenance and upkeep required by Lessee shall be - made in accordance with the manufacturer's recommendations. Lessee shall be obligated for all repairs to the heating/air conditioning system and the replacement of any components not covered by any existing warranty. In the event Lessee shall fail to comply with any of the - requirements of Section 5.1 or this Section 6.1 hereof, Lessor shall have the right, but not the obligation, to cause repairs or corrections to be made and any reasonable cost incurred by Lessor therefor shall be payable by Lessee to Lessor. Upon termination of this Lease, the Purchase - Option not having been exercised, Lessee shall deliver to Lessor the Leased Premises in good repair and condition, reasonable wear and tear excepted. Lessee shall repair any damage caused by Lessee's negligence or default hereunder, or negligence of Lessee's invitees, employees or -" customers. The Lessee will periodically have said building fumigated and/or sprayed for insects and rodents. Lessee grants Lessor a right of access to the Leased Premises to accomplish the intent of the provisions of this Lease, including Article 5 and Article 6 hereof. Article 7. Partial or Total Destruction of Leased Premises Section 7.1 Destruction of Facility. In the event the Facility should be totally destroyed _ by fire, tornado, or any other casualty, or in the event the Facility should be so damaged that rebuilding or repairs cannot be completed within one hundred eighty (180) days after the date of such damage, either Lessor or Lessee may at its option terminate this Lease, in which event _ Rental Payments which may become due subsequent to the date of such damage shall be abated during the unexpired portion of this Lease effective with the date of such damage. In the event the Facility should be damaged by fire, tornado, or other casualty covered by casualty insurance, _ but only to the extent that rebuilding or repairs can be completed within one hundred eighty (180) days after the date of such damage, or if the damage should be more serious but neither Lessor or Lessee elects to terminate this Lease, then in either such event Lessor shall within _ sixty (60) days after the date of such damage commence to rebuild or repair the Facility and shall proceed with reasonable diligence to restore the Facility to substantially the same condition in which it was immediately prior to the happening of the casualty. In the event that the Facility _ is totally untenable, the Lessor shall abate the Rental Payments due during the time the Facility Kerr County Juvenile Board - Lease-Purchase Agreement 6 is unfit for occupancy. If the Facility is not totally untenable, the Lessor shall allow the Lessee a fair diminution of Rental Payments due during the time the Facility is partially unfit for _ occupancy. It is specifically provided, however, that: (i) any rights or benefits provided to Lessee by this Section 7.1 are subject to Lessee having obtained and maintained in full force and effect the insurance coverages required to be provided by Lessee pursuant Article 4, and Section 4.1(b) specifically; and (ii) no abatement or partial abatement of Rental Payments pursuant to this Section 7.1 shall be or constitute a release, waiver or forfeiture of the benefits of any _ insurance provided pursuant to Section 4.1(b) or pursuant to any other provision hereof. In the event any mortgage instrument, deed of trust, security agreement or other financing document for the Facility should require that the casualty insurance proceeds be used to retire the mortgage, the Lessor shall have no obligation to rebuild and this Lease shall terminate upon notice to Lessee. _ Any obligation of the Lessor under this Article 7 shall be limited to the extent of the proceeds of casualty insurance actually received by the Lessor with regard to the Facility. Such obligations are further limited by the provisions herein regarding repair and replacement of the - Facility, and with regard to the application of insurance proceeds. Article 8. Utilities Section 8.1 Utilities. Lessee shall pay for all utilities furnished the Leased Premises for - the term of this Lease, including, but not limited to, electricity, gas, water and telephone service. Article 9. Assignment or Sub-Lease ` Section 9.1 Assignment or Sub-Lease by Lessee. Lessee agrees not to assign this Lease or sub-lease the Leased Premises, or any part thereof, or any right or privilege connected therewith, or to allow any other person, except Lessee's agents, contractors and employees, to _ occupy the Leased Premises or any part thereof, without first obtaining the Lessor's prior written consent. Lessee's interest in this Lease is not assignable by operation of law, nor is any assignment of its interest herein valid without Lessor's prior written consent. Article 10. Signs Section 10.1 Erection of Signs: Lessee shall not place signs or other objects upon the roof _ of any building on the Leased Premises or paint or otherwise deface the exterior walls of any building except with the prior written approval of Lessor. Notwithstanding the foregoing Lessee shall have the right to erect such other signs as it may desire subject to any applicable _ government laws, ordinances, or other requirements. Lessee shall remove all signs upon the Kerr County Juvenile Boazd "' Lease-Purchase Agreement 7 termination of this Lease. Any signor object installed on or removed from the Leased Premises _ shall be installed or removed in such manner as to avoid injury, defacement, or overloading of the building and the other improvements. _ Article 11. Alterations _ Section 11.1 Alterations by Lessee. Lessee shall not create any openings in the roof or exterior walls, nor make 'any alterations, additions, or improvements to the Leased Premises without the prior written consent of Lessor. All fixtures and improvements, including but not _ limited to floor coverings and heating and air conditioning units and all alterations, additions, and improvements, except trade fixtures, installed at the expense of Lessee, shall be the property of the Lessor and shall remain upon and be surrendered with the Leased Premises as a part - thereof at the termination of the Lease. Article 12. Liability of Lessee Section 12.1 Lessor Independent Contractor. At all times that this Lease is in effect, the - parties agree that Lessor is and shall be deemed to be an independent contractor and not an agent or employee of Lessee with respect to its acts or omissions hereunder. For all purposes hereunder, Lessor is and shall be deemed an independent contractor and it is mutually agreed -- that nothing contained herein shall be deemed or construed to constitute a partnership or joint venture between the parties hereto. The insurance requirements provided in Article 4 and the indemnification and hold harmless provisions provided in this Article 12 shall be in full force - and effect to the fullest extent permitted by law. Section 12.2 Limited Indemnity. Lessee agrees, to the fullest extent if any permitted by _ law, to indemnify and hold harmless Lessor and its officers, directors, agents, employees and representatives from and against all liability for any and all claims, suits, demands, and/or _ actions arising from or based upon intentional or negligent acts or omissions on the part of Lessee, its officers, directors, agents, representatives, employees, members, visitors, contractors and subcontractors (excluding Lessor) which may arise out of or result from Lessee's occupancy _ or use of the Leased Premises and/or activities conducted in connection with or incidental to this Lease. Lessee shall also indemnify Lessor and its officers, directors, agents, representatives and employees against any and all mechanic's and materiahnen's liens or any other types of liens _ imposed upon the Leased Premises arising as a result of Lessee's conduct or activity. Section 12.3 Limited Indemnity -Nature of Claim. The indemnity provisions in this _ Article 12 extend to any and all such claims, suits, demands, and/or actions regardless of the type of relief sought thereby, and whether such relief is in the form of damages, judgments, costs and reasonable attorney's fees and expenses, or any other legal or equitable form of _ remedy. These indemnity provisions shall apply regardless of the nature of the injury or harm Kerr County Juvenile Board -- Lease-Purchase Agreement g alleged, whether for injury or death to persons or damage to property, and whether such claims are alleged as common law, statutory or constitutional claims, or otherwise. These indemnity _ provisions shall apply whether the basis for claims, suit, demand, and/or action may be attributable in whole or in part to the Lessee, or to any of its agents, representatives, employees, members, visitors, contractors, and subcontractors if any (excluding Lessor), or to anyone _ directly or indirectly employed by any of them. _ Section 12.4 Claims Asserted by Certain Third Parties. Lessee agrees the indemnity provisions of this Article 12 shall apply to any and all claims, suits, demands and/or actions based upon or arising from any such claim asserted by or on behalf of Lessee or (excluding _ Lessor) any of its members, visitors, agents, employees, contractors and subcontractors. Section 12.5 Lessor Not Responsible for Lessee Actions. It is expressly understood and _ agreed that the Lessor shall not be liable or responsible for the negligence of Lessee, its agents, servants, and employees. Lessee further agrees that it shall at all times exercise reasonable precautions for the safety of representatives, employees, members, visitors, contractors and -- subcontractors (if any), and/or sub-lessees, and other persons, as well as for the protection of supplies and equipment and the personal property of Lessor or other persons on the Leased Premises. Lessee and Lessor further agree to comply with all applicable provisions of Federal, -- State, and municipal safety laws, regulations and ordinances. Section 12.6 Lessee Not Responsible for Lessor Actions. It is expressly understood and - agreed that the Lessee shall not be liable or responsible for the negligence of Lessor, its agents, servants, and employees, when Lessor is acting in its capacity as Lessor. Lessor further agrees that it shall at all times, when entering upon the Lease Premises as Lessor, exercise reasonable precautions for the safety of representatives, employees, members, visitors, contractors and subcontractors (if any), sub-lessees, and other persons, as well as for the protection of supplies and equipment and the personal property of Lessee or other persons on the Leased Premises. Section 12.7 Notice of Claim. Lessee and the Lessor each agree to give the other party prompt and timely notice of any such claim made or suit instituted which in any way, directly or indirectly, contingently or otherwise, affects or might affect the Lessee or the Lessor. Lessee further agrees that these indemnity provisions shall be considered as an additional remedy to Lessor and not an exclusive remedy. Section 12.8 Liability Insurance. Lessee agrees that, pursuant to Section 4.2, it shall obtain or cause to be obtained for the benefit of Lessee and Lessor, and keep in full force and effect _ during the Term of this Lease, a policy or policies of liability insurance (or liability risk pool coverage) sufficient to protect Lessee and Lessor from the claims and matters referenced in this _ Article 12. Lessor and Lessee agree that such insurance may be provided by the operator pursuant to an operation and management agreement for the Facility, and Lessee agrees that it shall require any person, firm or entity contracting to operate and manage the Facility to provide _ insurance or risk pool coverage in such amounts as Lessee may deem reasonable and sufficient Kerr County Juvenile Board ~' Lease-Purchase Agreement 9 to provide insurance or coverage against any claims or matters referenced in this Article 12. Lessor further agrees that, provided it has in writing approved the policy or policies of insurance - or coverage provided pursuant to Section 4.2, including specifically the insurance or coverage provided pursuant to Section 4.2(a), and this Article 12, save and except for any mechanic and materialmen lien or similar lien filed against the Leased Premises as a result of conduct or _ activity of the Lessee, the obligation of Lessee to Lessor pursuant to this Article 12 shall be limited to the insurance or coverage so provided and approved. Article 13. Access Section 13.01 Access by Lessor. Lessor may, during the term of this Lease, at reasonable times, enter the Leased Premises to view, inspect, show to prospective purchasers, and to _ exercise and accomplish any of its rights and responsibilities under this Lease. Article 14. .... Breach and Remedies Section 14.1 Breach. A breach or default under this Lease shall have occurred upon: (a) Failure by Lessee to pay when due any Rental Payments or other sums payable by Lessee hereunder, immediately upon written notice from Lessor; (b) Vacation or abandonment of the Leased Premises by Lessee; - (c) Commencement of any case, action, or proceeding by, against, or concerning Lessee under any federal or state bankruptcy, insolvency, or other debtor's relief law, including without limitation a case, cause of action, or proceeding seeking - Lessee's financial reorganization or an arrangement with any of Lessee's creditors; . ~' (d) Voluntary or involuntary appointment of a receiver, trustee, keeper or other person who takes possession of substantially all of Lessee's assets or of any asset used in Lessee's business on the Leased Premises, regardless of whether such "` appointment is as a result of insolvency or any other cause; (e) Execution of an assignment for the benefit of creditors of substantially all assets of Lessee available by law for the satisfaction of judgment creditors; (f) Commencement of proceeding for winding up or dissolving (whether voluntary _ or involuntary) the entity of Lessee; _ (g) Levy of a writ of attachment or execution on Lessee's interest under this Lease; Kerr County Juvenile Board - Lease-Purchase Agreement 10 (h) Transfer or attempted transfer of this Lease by Lessee contrary to the provisions of this Lease; (i) Breach by Lessee of any other term, covenant, condition, warranty, or provision contained in this Lease or of any other obligation owing or due to Lessor, including, without limitation, such terms, covenants, conditions, warranties, or -provisions the violation of which are specifically designated as events of breach or default of Lessee hereunder, and further including but not limited to improper _ use of the Leased Premises or operation of the Lessee's business in violation of any applicable laws rules, or regulations; (j) Failure of Lessee to comply with any material rule or standard, after notice and failure to cure for a reasonable period of not less than thirty (30) days, of the _ Texas Juvenile Probation Commission applicable to it or its operation of the Leased Premises; or ,.... (k) Failure of Lessee to make a timely request to the Texas Juvenile Probation Commission for funds to satisfy its obligations under the Lease as contemplated and described in the Essential Use and Source of Funds Certificate attached _ hereto as Exhibit "C" and incorporated herein for all purposes. Section 14.2 Rights of Lessor Upon Lessee's Default. Subject to and except as provided - in Section 17.5, upon the occurrence of any event of breach or default, Lessor shall have the option to do any one or more of the following without notice or demand, in addition to and not in limitation of any other remedy permitted by law or by this Lease: (a) Terminate this Lease, in which event Lessee shall immediately surrender the Leased Premises to Lessor. If Lessee shall fail to so surrender the Leased - Premises, Lessor may without notice and without prejudice to any other remedy Lessor may have for possession or arrearage in rent, enter upon and take possession of the Leased Premises and expel or remove Lessee and its effects -' without being liable to prosecution or any claim for damages therefor. To the extent, if any, permitted by law, Lessee agrees to indemnify Lessor for all loss and damage which Lessor may suffer by reason of such termination, whether - through inability to relet the Leased Premises or otherwise, including any loss of rental for the remainder of the Lease Term. - (b) Lessor may remove all of Lessee's personal property from the Leased Premises, and may store such personal property in a public warehouse or at another place of its choosing at Lessee's expense or to Lessee's account. (c) Enter upon and take possession of the Leased Premises as the agent of Lessee without terminating this Lease and without being liable to prosecution or any Kerr County Juvenile Board - Lease-Purchase Agreement 11 claim for damages therefor. Entry only, without notice of termination, will not _ terminate the Lease. Lessor may relet the Leased Premises as the agent of Lessee and receive the rent therefor, in which event Lessee shall pay to Lessor on demand the cost of renovating, repairing and altering the Leased Premises for a _ new tenant or tenants, together with interest on any sums so advanced computed at the highest lawful rate per annum from the date of the expenditure of such ' sums until such payment is received by Lessor, and any deficiency that may arise _ by reason of such reletting. Lessor, however, shall have no duty to relet the Leased Premises and the failure of Lessor to relet the Leased Premises shall not release or affect Lessee's liability for Rental Payments and other charges due _ hereunder or for damages. (d) Lessor may do whatever Lessee is obligated to do by the provisions of this Lease _ and may enter the Leased Premises without being liable to prosecution or any claim for damages therefor, in order to accomplish such purpose. Lessee agrees to reimburse Lessor immediately upon demand for any expenses, including - attorneys' fees, which Lessor may incur in thus effecting compliance with this Lease on behalf of Lessee, together with interest on any sums so advanced computed at the highest lawful rate per annum from the date of the expenditure -- of such sums until such payment is received by Lessor, and Lessee further agrees that Lessor shall not be liable for any damages resulting to Lessee from such action, whether caused by the negligence of Lessor or otherwise. Section 14.3 Continuance of Lease. Upon the occurrence of any event of breach or default by Lessee and unless and until Lessor elects to terminate this Lease pursuant to Section 14.2 above, this Lease shall continue in effect after the occurrence of any event of breach or default by Lessee and Lessor may enforce all rights and remedies under this Lease, including without limitation, the right to recover payment of Rental Payments as they become due. Neither efforts by Lessor to mitigate damages caused by an event of breach or default by Lessee nor the acceptance of any Rental Payments shall constitute a waiver by Lessor of any of Lessor's rights or remedies, including the rights and remedies specified in Section 14.2 above. Section 14.4 Security Interest in Facility. The rights of Lessor under this Article 14 are subject to Section 17.5 and additional to all other rights to which Lessor is entitled in accordance _ with applicable law. Notwithstanding any other provision of this Lease to the contrary, in the event Lessee fails to pay any Rental Payment or to perform any other fmancial obligation _ pursuant to this Lease as a result of a failure to appropriate and/or insufficient revenues as set forth in Section 17.5, Lessor's remedies shall be limited to the Facility and the funds and revenues then available pursuant to appropriations specifically for and with respect to the Lease _ and the Interlocal Contracts for the housing of juveniles in the Facility. Notwithstanding any other provision of this Lease to the contrary, in the event of a breach or default by Lessee the Lessor shall have the right to terminate this Lease or to reenter and take possession of the _ Leased Premises, with or without terminating this Lease, pursuant to any section, term or Kerr County Juvenile Board -" Lease-Purchase Agreement 12 provision of this Lease, and Assignee may exercise any such right or power pursuant to the Lease or any agreement between Lessee and the Assignee. Article 15. Effect of Lessor's Waiver Section r5.1 Waiver by Lessor. Lessor's waiver of a breach or default of any covenant _ or condition of this Lease is not a waiver of breach or default of any others, or of subsequent breach or default of the one waived. Lessor's acceptance of Rental Payments after breach or default is not a waiver of the breach or default, except of breach or default of the covenant to _ pay Rental Payments or Rental Payments accepted. Article 16. Effect of Eminent Domain Proceedings Section 16.1 Condemnation. Eminent domain proceedings resulting in the condemnation - of part of the Leased Premises that leave the rest reasonably usable by Lessee for purposes of the business for which the Leased Premises are leased will not terminate this Lease unless Lessor at its option terminates the Lease by giving written notice of termination to Lessee. The effect - of any such condemnation will be to terminate the Lease as to the portion of the Leased Premises condemned, and leave the Lease in effect as to the remainder of the Leased Premises. Lessee's Rental Payments for the remainder of the Lease term shall in such case be reduced by - the amount that the usefulness of the Leased Premises to it for such business purpose is reduced. Article 17. Miscellaneous Provisions Section 17.1 Governing. Law. This Lease shall be construed and enforced in accordance - with the laws of the State of Texas and the parties hereto shall interpret, construe and enforce its terms, conditions and provisions consistent with, and in a manner to preserve and protect, the continuing exercise and performance by Lessee of its governmental duties, discretion and -' control. All obligations of the parties created hereunder are performable in the County. Section 17.2 Successors. The covenants and agreements contained in this Lease shall be ` binding on and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors, and assigns except as may otherwise be expressly provided herein. Section 17.3 Severability. In case any one or more of the provisions contained herein shall _ for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceabiliry shall not affect any other provision of this Lease, but this Lease shall be construed as if such invalid, illegal or unenforceable provision had not been contained Kerr County Juvenile Board -- Lease-Purchase Agreement 13 herein. However, if Lessee's obligation to pay the Rental Payments is determined to be invalid or unenforceable, this Lease at the option of Lessor shall terminate. Section 17.4 Other Agreements. This Lease constitutes the sole and only agreement of the parties hereto and supersedes any prior written or oral lease agreement between the parties - respecting the within subject matter. _ Section 17.5 Ayyropriations. Notwithstanding any provision of this Lease to the contrary, the obligations of the Lessee contained herein are subject to and contingent upon appropriations by the State Legislature of state funds through the Texas Juvenile Probation Commission, or its successor, and the terms and conditions set forth in the Essential Use and Source of Funds _ Certificate attached as Exhibit "C" and incorporated herein for all purposes. _ Section 17.6 Attorney's Fees. If any action at law or in equity, including an action for declaratory relief, is brought to enforce or interpret the provisions of this Lease, the prevailing party shall be entitled to recover reasonable attorney's fees from the other party, which fees may _ be set by the court in the trial of such action brought for that purpose, and which fees shall be in addition to any other relief which may be awarded. _ Section 17.7 Notices. Any notice required or desired to be given under this Lease shall be in writing with copies directed as indicated and shall be personally delivered or given by mail. Any notice given shall be deemed to have been given when hand delivered or, if mailed, - as of seventy-two hours from the time when notice was deposited in the United States mails (certified or registered, return receipt requested, postage prepaid), addressed to the party to be served with a copy as indicated herein. Either party may change its address for purposes of - notice by giving notice of such change of address to the other party in accordance with the provisions of this Section 17.7. At the date of execution of this Lease, the addresses of the parties are: Lessee: Kerr County Juvenile Board, 624 Jefferson -- Kerrville, Texas 78028 Attention: Chief Juvenile Probation Officer ~' With copies to: County Judge and Judge, 198th Judicial District Kerr County Courthouse - Kerrville, Texas 78028. _ Lessor: ReCor, Inc. 5912 Balcones Drive, Suite 250 Austin, Texas 78731 Attention: President Kerr County Juvenile Board - Lease-Purchase Agreement 14 Assignee: ChiCorp Financial Services, Inc. 208 South LaSalle St. Chicago, Illinois 60604 Attention: Ramona Regas, Vice President Section 17.8 Operation and Management Contract. Lessee may, in its sole discretion, from time to time Contract for operation and management of the Leased Premises or directly operate _ and manage the Leased Premises; provided that, in the event Lessee directly operates and manages the Leased Premises, Lessee agrees to and shall perform each duty and responsibility stipulated herein to be performed by the Management Contractor. Subject to the Lessee _ hereafter giving written notice to Lessor, on or before the Effective Date, that it will directly operate and manage the Leased Premises, Lessee agrees to enter into a contract with a third party (the "Management Contractor") for the operation and management of the Leased Premises _ (the "Operation and Management Contract") on or before the Effective Date. Lessee further agrees the Operation and Management Contract (if any) shall require the Management Contractor to administratively: (a) collect the costs, expenses and fees payable by Lessee pursuant to - Articles 3, 4, 5 and 6 of this Lease; (b) secure and account for all funds; (c) secure all required property and liability insurance; and (d) make timely payment of all such tax, insurance and maintenance costs for and on behalf of Lessee. Section 17.9 Additional Covenants of Lessee. Lessee represents, covenants and warrants that it is an agency, a unit, a political subdivision or a governmental entity of the State of Texas, - or that Lessee's obligation under this Lease constitutes an obligation issued on behalf of a state or political subdivision thereof, and that: - (a) Any portion of the Rental Payments or other payments made by it in connection with this Lease which may subsequently be deemed interest derived under this Lease will qualify for exemption from federal income taxes under Section 103 of the Internal Revenue Code -' of 1986, as amended (the "Code"); (b) This Lease represents a valid deferred payment obligation for the amount herein set - forth and that Lessee, having the legal capacity to enter into the same, is not in contravention of any Town/Ciry, District, County or State statute rule, regulation, or other governmental provision; (c) Lessee agrees (i) it will do or cause to be done all things necessary to preserve and keep _ the Lease in full force and effect; (ii) it has complied with all bidding requirements where necessary and by due notification presented this Lease for approval and adoption as a valid obligation on its part; and (iii) it has sufficient appropriations or other funds available to pay _ all amounts due hereunder for the current fiscal period; (iv) that during the term of this Lease, the Leased Premises will be used by Lessee only for the purpose of performing one or more governmental or proprietary functions of Lessee consistent with the permissible _ scope of Lessee's authority and will not be used in a trade or business of any person or Kerr County Juvenile Board "' Lease-Purchase Agreement 15 entity other than the Lessee; (v) it will take no action that will cause any portion of any Rental Payment deemed to be interest to become includable in gross income of the recipient _ for purposes of deferral of income taxation under the Code, as amended, and Lessee will take, and will cause its officers, employees and agents to take, all affirmative action legally within its power to prevent any such portion of any Rental Payment subsequently deemed _ to be interest from being includable in gross income for purposes of federal income taxation under the Code; and (vi) it will timely file the appropriate Forms 8033-G with the Internal Revenue Service; and (d) During the Term of this Lease, the compensation arrangements provided in any _ Operation and Management Contract executed by the Lessee for or with respect to the Facility shall satisfy the requirements of Section 5 of Revenue Procedure 93-19, as amended, and any then existing subsequent applicable regulations and rulings, so as to not _ cause the Facility to be treated as used in a private business use under section 141(b) of the Code, and (i) no such Operation and Management Contract shall provide for any compensation for services based, in whole or in part, on a share of net profits from the _ operation of the Facility; but (ii) shall provide a compensation arrangement and contract term authorized pursuant to sections 5.02(a),(b),(c) or (d), and 5.03 of Revenue Procedure 93-19, as amended, or its successor. Article 18. Purchase Options and Use Section 18.1 Continuing_Option to Purchase. Lessee shall have the option to purchase Lessor's interest in this Lease and the Leased Premises on any applicable payment date for - Rental Payments after the eighty-seventh (87th) month following the Effective Date ("Option Payment Date") providing: (i) Lessee is not in default under the Lease; (ii) Lessee gives notice to Lessor of its intention to exercise this option at least sixty (60) days prior to the Option Payment Date on which the option is to be exercised; (iii) Lessee has complied with all applicable laws concerning acquisition of property; (iv) there is a specific purchase option price shown in Exhibit "B" hereto and incorporated herein for all purposes on that Option Payment -' Date; and (v) on the Option Payment Date, the Lessee shall deposit with the Lessor an amount equal to all Rental Payments and any other amounts then due or past due (including but not limited to the Rental Payment due on the Option Payment Date) together with the applicable Purchase Option Price set forth in Exhibit "B". The closing shall be on the Option Payment Date or the first business day preceding the Option Payment Date at the office of the Lessor or such other place as Lessor may direct. Section 18.2 Option at Expiration of Term. In consideration of the timely payment of the _ Rental Payments hereunder, the Lessee shall further have the option to purchase Lessor's interest in this Lease and the Leased Premises for the sum of One Dollar ($1.00) upon the expiration of the Lease Term, provided: (i) Lessee is not in default under the Lease; (ii) Lessee gives notice to Lessor of its intention to exercise this option within sixty (60) days from the date the Kerr County Juvenile Board Lease-Purchase Agreement 16 last scheduled Rental Payment is made and Lessee has been provided written notice by Lessor requesting directions for delivery of the deed held in escrow; and (iii) Lessee complies with all applicable laws concerning acquisition of the Leased Premises. Article 19. Permitted Uses Section 19.1 Premises Use. The Lessee will use the Leased Premises in a manner contemplated by this Lease and in the Essential Use and Source of Funds Certificate and shall comply with all applicable laws, ordinances, claims, damages, fees and charges arising out of its possession, use or maintenance. The Lessee, at its expense, shall be responsible for and shall pay all charges for the maintenance of the Leased Premises. No more than ten percent (10%) of the use of any unit of the Leased Premises in any month will be by persons or entities other than the Lessee or its employees on matters relating to such employment, and no more than five percent (5 %) of use of any unit of the Leased Premises in any month will be unrelated to use by or for the Lessee; provided that the admission of persons assigned to the Facility by Lessee pursuant to a contract or agreement with a jurisdiction, unit or agency created pursuant to statute to perform governmental services similar to those performed by Lessee shall be deemed to be a use by Lessee. IN WITNESS WHEREOF, this Lease is executed as of the date above set forth: LESSEE: LESSOR: KERR COUNTY JLJVENII,E BOARD, RECOR, INC. - as agent for Kerr County, Texas I-~ ' ~ am` • ~„ -~~-,c - By: . By: Name: Simon J. Harris Name: Glen Heckman Title: Chief Juvenile Officer _ Title: President ^ /~ By: - r s ATTEST:- -- --_ Name: Wil lain G. Stac ~ Title: County Judge By• ~ Corporate Secretary [seal] .~ ~., _ 1~1, ~ r Kerr County Juvenile Board ` _ ~ Lease-Purchase Agreement '~. '"°' 17 ~'~~, , EXHIBIT "A" PROPERTY: Lot 1, Block 1, and Lot 1, Block 2, Final Plat of RECOR SUBDIVISION, a subdivision according to map or plat recorded in Volume ~, Pages 212 of the Plat Records of Rerr County, Texas. EXHIBIT "B" AMORTIZATION SCHEDULE & PURCHASE OPTION 1V U/ 1JILJLU:10J0 fUULlUUJ Uij-LU-~4 1L.11I1V1 fRV1Y1 1,AIVURI P11~K1YU1t1L Ex~xbir a - Payment Real Property Lease Lessee: Kerr County FIriC No. Date Schedule -Purchase Juvenzle Payment Amount Number 1 Agreement D~tenti,on F>scility, TX Interest Purchase Portion of Option Stipulated Payment Prxnc~.pal Price Loss Value 1 3/ 1/95 27,965.49 19,253.00 s,712.49 N/A 3,276,455 2 4/ x/95 27,965.49 19,196.37 $,769.12 N/A 3,265,213 3 5/ 1/95 27,965.49 19,139.37 6,826.12 N/A 3,253,914 4 6/ 1/95 27,965.49 19,082.00 8,883.49 N/A 3,242,557 5 '~/ 1/95 27,965.49 19,024.26 8,941.23 N/A 3,231,142 Fi 8/ 1/95 27,965.49 18,966.14 8,999.35 NJA 3,219,669 7 9/ 1J95 27,965.49 18,907.64 9,057.84 N/A 3,208,137 8 l0/ 1/95 27,965.49 1.8,848.77 9,116.72 N/A 3,196,546 9 11/ 1/95 27,965.49 18.789.51. 9,175.98 N/A 3,184,897 i0 12/ 1J95 2'/,965.49 18,729.86 9,235.62 N/A 3,173,187 11 1/ 1/96 27,9&5.49 28,669.83 9,295.65 N/A 3,161,418 :12 2/ 1/96 27,965.49 18,609.9:1 9,356.07 N/A 3,149,589 13 3j 1/96 27,965.49 18,548.60 9,416.89 N/A 3,137,700 14 4/ 1/9b 27,965.45 18,487.39 9,478.1 N/A 3,125,750 15 5/ 1/96 27,965.49 18,425.78 9,539.71 N/A 3,113,739 16 6/ 1/96 27,965.49 18,363.77 9,601.71 N/A 3,101,666 17 7/ 1/96 27,965.49 18,301.3E 9,664.13 N/A 3,089,532 18 S/ 1/96 27,965.49 18,238.54 9,726.94 N/A 3,077,336 19 9/ 1/96 27,965.49 18,175.32 9,790.17 N/A 3,065,o7s 20 aoJ x/96 27,965_x9 18,111.6s 9,853.80 N/A 3,052,757 z:L 11/ 1/96 27,9&5.49 18,047.63 9,917.$5 NjA 3,040,373 22 12/ 1/9b 27,965.49 17,993.17 9,982.32 NjA 3,o27,9z6 23 Z/ 1/97 27,9G5.49 17,918.28 10,047.20 NiA 3,015,416 24 2/ 1/97 27,9&5.49 17,852.97 1t~,112.51 N/A 3,002,842 25 3/ 1/97 27,965.49 17.787.?.4 10,178.24 N/A 2,990,203 26 4/ 1/97 27,965.49 17,721.0$ 10,244.40 NjA 2,977,500 27 5/ 1/97 27,965.49 3.7,654.50 10,310.59 N/A 2,9F4,'732 28 6/ 1/97 27,965.49 17,587.47 10,3%f3.01 N/A 2,951,899 29 7/ 1/97 27,965.49 17,520.02 10,445.47 NfA 2,939,001 30 8/ 1/97 27,965.49 17,452.12 _ 10,513.36 N/A 2,926,036 31 9/ 1/97 27,965.49 17,383.79 10,5$1.70 N/A 2,913,006 32 1.0/ 1/97 27,965.49 17,315.00 10,650.4$ N/A 2,899,909 33 11/ X/97 27,965.49 x.7,245.78 10,719.71. N/A 2,8$6,745 34 12/ 1/97 27,9&5.49 17,176.10 14,789.39 N/A 2,$73,514 35 1/ 1/9$ 27,965.49 17,105.97 10,$59.52 N/A 2,a6o.,215 36 2/ 1/9E 27,965.49 17,035.38 10,930.11 N/A 2,846,$49 3'T 3/ 1/98 27,965.49 16,964.33 11,00X.15 NfA 2,833,414 38 4/ 1/98 27,965.49 1&,892.83 11,072.66 N/A 2,819,911 39 5/ 1/98 27,965.49 16,820.85 11,144.63 N/A 2,806,339 40 6/ 1/98 27,9&5.49 16,748.41 1.x,217,07 N/A 2,792,697 41 7/ 1/98 27,965.49 1,6,675.50 11,289.98 NJA 2,778,986 42 F3/ 1/98 2'/,965.49 16,602.12 11,363.37 N/A 2,7&5,205 43 9/ 1/98 2?,9&5.49 16,528.26 11,437.23 N/A 2,751,:54 44 10/ 1/98 27,965.49 16,453.91 21,57.1.57 N/A 2,737,432 45 7.1/ 1/98 27,965.49 16,379.09 7.1,586.40 NjA 2,723,438 46 12/ 1/98 27,965.49 16,303.78 11,661.71 N/A ti,709,374 47 1/ 1/99 27,965.49 16,ZL7.98 11,737.52 N/A 2,695,237 48 2 f 1/99 Z7, 965 .49 16, 153..68 1.1, 813.80 N/A 2, 681, 025 :;:,49 3/ ]./99 2T, 965 .49 16, 074.89 11, 890 _ ~9 NJA 2, 666, 74$ SO 4/ 1./99 27,965.4y 25,997.60 11,967.88 NfA 2,652,394 51 5/ 1/99 27,9&5,49 15,919.81 12,045.67 NfA 2,&3'7,967 52 6/ 1/99 27,965.49 15,841.52 12,123.97 N/A 2,623,466 53 7/ ljyy 27,965.49 15,762.71 12,202.78 N/A 2,6x$,891 + V V J: V V J 1~11Y 111VV 1t1L 1V J/ iJ1LJLU.~UJU u~'-co-~~ !c•li[m r~uivi ~niw~i ~ Exhibit 8 - Payment Schedule - Real Property Lease-Purchase Lessee: Kerr County Juvenile Number 1 Agreement DetCntion Facility, TX Interest PortYOn of Fdyment 15,683.39 15,603.56 15,523.21 15,442.33 15,360.93 15,279.00 15,196.54 15,113.54 15,030.00 14,945.92 1.4, 861.30 14,776.12 14,690,39 14,604.10 14,517.25 x4,429.84 14,341.86 14,253.30 14,164.17 14,074.46 7.3, 984.17 13,$93.29 13,801.82 ~.~ , 7x9.76 13,617.10 13,523.83 7.3,429.96 13,335.48 13,240.39 13,144.67 13,048.34 12,951.38 12,AS3.79 12,755.56 12,656.69 12,557.19 12,457.03 12,356.23 12,254.77 12,152.65 12,49.87 11,946.41 11,842.29 11,737.49 11,632.01 11,525.84 ~.1, 418.98 11x311.43 11,203.18 11,094.22 10,984.5b 7.0, B74 . 7.E3 10,763.09 Pmt NO. Date 54 55 S6 57 58 s9 60 6 ~. 62 63 64 65 66 67 68 69 70 71 72 73 ?4 75 76 77 78 79 $0 $1 82 83 $4 85 86 $7 $a 89 90 91 92 93 94 9s 96 97 98 99 100 7.01 ~::, 102 '`~03 104 105 106 8/ 9/ 1Q/ 11/ l2/ 1/ 7./ 3/ 4/ 5/ 6/ 7/ 8/ 9i 1.0 / 1x1 12f i/ z/ 3/ 4/ 5j 6/ 7/ 8/ 9/ lo/ 11/ 12/ 1/ ~1 3/ 4/ 5/ 6/ 7/ 8/ 9/ 7 0/ 11/ 12/ 1/ 2/ 3/ 4/ 5/ FI 7/ 8/ 9/ a.al 11/ 12/ ~./9~ 1/99 1/~9 1/99 1/99 ~. joo 1Jfl0 1/00 1/40 1/00 1/00 1/00 1/00 7./00 1/DO 1/00 ~.j00 ~/oi 1/O1 1/01 l/ol 1/al x/01 1/01 1/01 1/U1 1/01 1/(?7. 1/01 1/02 i/a2 1/02 1/02 11x2 1/,02 1/02 1/02 1/02 1/02 1/02 1/02 11x3 1./03 1/03 1/03 1/43 1/03 1/43 1/03 1/03 Z/03 1/03 1/Q3 Payment Amount 27,965.49 27,965.49 27, 965 .49 27,865.49 27,965.49 27,965.49 27,965.45 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965,49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,9h5.49 27,965.49 27,965.49 27,9ss.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 27,965.49 Purchase Option scipulated Principal Price Loss value 12,282.09 N/A 2,594,242 12,361.93 N/A 2,579,518 12,442.28 N/A 2,564,718 12,523.15 N/A 2,549,$44 7.2, 604.56 D7/A 2, 534, 893 12,686.49 N/A 2,51y,866 12,768.95 N/A 2,504,7G2 12,851.95 N/A 2,489,582 12,935.48 N/A 2,4?4,323 13,019.56 N/A 2,458,987 13,104.19 N/A 2,443,573 ].3,189.37 N/A 2,428,080 13,275.10 N/A 2,412,508 13,36].39 N/A 2,396,856 13,448.24 N/A 2,382,124 13,535.65 N/A 2,365,313 13,G23.63 N/A 2,349,420 13,77.2.19 N/A 2,333,446 13,801.31 N/A 2,317,391 13,891.02 N/A 2,301,254 13,981.31 N/A 2,285,035 14,p72_l_9 N/A 2,258,732 14,163.66 N/A 2,252,347 14,255.73 N/A 2,235,878 14,348.39 N/A 2,23.9,324 14,441.65 N/A 2,202,687 14,535.52 N/A 2,185,964 14,630.00 N/A 2,169,7.56 14,725.10 N/A 2,152,262 14,820.81' ~ N/A 2,235,"L $2 14,917.15 2,118,216 2,118,216 15, 014.7.1 N/A 2, 101, 062 15,111.70 N/A 2,083,821 15,209.93 N/A 2,066,491 15,308.79 N/A 2,fl49,074 15,408.30 N/A 2,031,567 15,50$.45 NiA 2,013,971 15,609_?.6 N/A 1,996,285 15,77.0.72 N/A 2,978,509 15,812.84 N/A 1,960,642 3.5, 91~ .62 N/A 1, 942, 684 16,019.07 N/A 1,924,634 16,123.20 1,906,493 1,906,493 16,228.00 N/A 1,8$8,258 1&,333.48 N/A 1,869,931 16,439.65 N/A 1,551,510 16,546.50 N/A 1,832,994 16,654.06 N/A 1,814,385 16,762.37. N/A 1,795,680 16,871.26 N/A 1,776,880 16, 980.93 N/A 1, '75.7 , 984 17,091.3a N/A 1,738,992 17, 202 .40 AT/A 1, 719, 902 Vv LU ~-= 1L 111111 l It V1Y1 I~LLl VVa.l ' '"~" ExIS~.bit B - Payment Schedule Real Property Lease~Furchase Lessee: Kerr County Juvenile Pmt Payment NO. Date Amount Number 1 Agreement Detention Facility, TX Interest Portion O~ Payment Principal Purchase option Stipulated Price Lass Value 107 ^+1/ 1/04 27,965.49 10,65].28 17,314.21 N/A 1,700,716 108 2/ 1/04 27,965.49 10,53$.73 17,426.75 1,681,431 1,681,~l31 109 3/ 1/0'4 27,965.49 10,425.46 27,540.03 N/A 1,662,048 110 4/ 1/04 27,965.49 10,311.45 1'1,654.04 N/A 1,642,566 111 5/ 1/04 27,965.49 10,196.70 17,768.79 N/A 1,622,984 112 6/ 1/04 27,965.49 10,0$1.20 17,$84.29 N'/A 1,603,303 113 7/ 1/04 27,965.49 y,964.95 18,000.53 N/A 1.,583,521 114 8/ 1/04 27,965.49 9,847.95 18,117.54 N/A 1,563,638 11.5 9/ 1/04 27,965.49 9,730.18 18,235.30 N/A 1,543,553 1,16 io/ ~/og 27,965.49 9,611,66 18,353.83 N/A 1,523,567 1.17 11/ 1/04 27,965.49 9,492.36 18,473.13 N/A 1,503,378 118 12/ 1/04 27,965.49 9,372.28 18,5y3.21 N/A 1,483,086 114 1/ 1./05 27,965.49 9,257..42 18,714.06 NfA 1,462,690 120 2/ 1/05 27,865.49 9,129.78 18,835.70 1,a42,191 1,442,191 z21 3/ 1/05 27,965.49 9,007.35 18,958.14 N/A 1,421,586 122 4/ 1/05 27,965.49 8,884.12 19,081.36 N/A 1,400,877 123 5/ 1/05 2?,965.49 8,760_D9 19,205.39 NfA 1,380,062 124 6/ 1/05 27,965.49 8,635,26 19,330.,23 N/A 1,359,140 125 ?/ 7./05 27,965.49 8,509.6x 29,455.87 NJA 1,338,122 126 8/ 7./05 27,965.49 8,383.15 19,582.34 N/A 1,326,976 127 9/ 1/05 27,965.49 8,255,86 19,709.62 NfA 3,,295,733 128 10/ 1/05 27,965.49 8,127.75 7.9,837.73 N/A 2,274,3$1 128 71/ 1/45 2'7,965.49 7,998.81. 19,966.68 NiA 1,252,920 130 12/ 1/05 27,965.49 7,869.02 20,096.46 N'/A 1,231,350 231 1/ 1/06 27,965.49 7,735.40 20,227.09 N/A 1,209,670 132 2/ ~./a6 27,965.49 7,606.92 20,35$.57 1,187,$78 3,1$7,878 133 3/ 1/06 27,965.49 7,474.59 20,490.90 N/A 1,165,976 134 4/ 1/06 27,965,49 7,341,40 20,624.09 N/A 1,243,962 135 5/ 1/06 27,965.49 7,207.34 20,758.7.4 " N/A 1,121,835 136 6/ 1/06 27,965.49 7,072.41 ' 20,893.07 N/l~ 1,099,596 137 7j i/06 27,965.49 6,936.61 21,028.$8 N/A 1,1177,243 138 $/ 1/06 27,965.49 6,799.92 21,165.57 N/A 1,054,776 139 9/ 1/06 27,965.49 6,662.35 21.,303.14 N/A 1,032,194 140 10/ 1/06 27,965.49 6,523.$7 21,441.61 N/A 1,009,497 141 17./ 1/06 27,965.49 6,3$4.50 21,5$0.98 N/A 986,684 142 12/ 1/06 27,965.49 6,244.23 21,721.26 N/A 963,755 143 1/ 1/07 27,955.49 6,103.04 21,862.45 N/A 940,709 144 2/ 7./07 27,965.49 5,960.93 22,004.55 ~~.7,545 917,345 145 3/ 1/07 27,965.49 5,317.90 22,7.47.58 N/A 894,263 146 4/ 1/07 27,965.49 5,673.94 22,291.54 N/A 870,862 147 5f 1/07 27,965.49 5,529.05 22,436.44 N/A 847,341 14II 6/ 1/07 27,965.49 5,383.21. 22,582.27 N/A 823,701 149 7/ 1/07 27,965.49 5,236.43 22,729.06 N/A 799,939 150 8/ 1/07 27,965.49 S,OSS.G9 22,876.80 N/A 776,057 151 9/ 1/07 27,965.49 4,939.99 23,025.50 N/A 752,053 l52 10/ 1/07 27,965.49 4,790.32 23,175.16 N/A 727,926 153 11/ 1/07 37,965.49 4,639.69 23,325.$0 N/A 703,676 54 7 12/ 1/07 27,965.49 4,4$8.07 23,477,42 iV/A 679,302 . '~'~' `..55 1/ 7./0$ 27, 965 _49 4, 335 .46 23, 630 _ 02 N/A 554, 804 156 2/ 1/On 27,965.49 4,1$1.87 23,793.62 630,1$0 630,180 157 3l 1./08 27,965.49 4,027.28 23,938.27. N/A 60,431 158 4/ 1/08 27,965.49 3,A71.68 2-4,093.81 N/A 580,556 159 5/ 1.l~78 27,965.49 3,715.07 24,250.42 N/A 555,554 1 VUV! UV V l L L. l iL` v L! i L L v V! L V L C. V 4 V V V V V UU LU J`r 1 L l 11 lu l AVirl V111 VVriI E~L7lib it B - Paymerat Schedule NUmbe]C ~. _ Real Prapex•ty Leas e-Purchase 1~gxeement Lesse e: Kerr County Juvenile Detention Facil~.ty, TX Interest Purchase ` Pmt Payment Port~,on a~ Option stipulated No. Date Amount Payment Principal price Loss value 160 5/ 1/08 27,965.49 3,557 44 24,40$.05r ^_..____N/A- __+530,424 - 161 7/ 1/08 21,965.49 3,398.79 24,566,70 N/A 505,166 162 8/ 1/0~ 27,965.49 3,239.10 24,726.38 N'/A 479,779 163 9/ 1/08 27,965.49 3,078.38 24,887,10 ~N/A 454,262 164 ~ 10/ 1/48 27,965.49 2,916.62 25,048.87 N/A 428,615 - l65 11/ 1/08 27,965.49 2,753.80 25,211.69 N/A 402,838 166 12/ 1/OB 27,965.49 2,589.92 25,375.56 1V/A 376,928 167 1/ 1/09 27,965.49 2,424.98 25,540.50 N/A 350,$97 -- ~ 168 2/ 1/09 27,965.49 2,259.97 25,706.52 324,712 324,712 169 3/ I/o9 2'/,965.49 2,091.88 25,$73.61 N/A 298,404 170 4/ 1/09 27,965.49 1,923.70 26,041,79 N/A 271,9G2 171 5j 1/09 27,965.49 1,,754.43 26,211,06 NjA 245,384 - 172 6/ 1/09 27,965.49 1,584.05 26,381.4 3 N/A 218,6?1 173 7/ 1/09 27,965.49 1,412.58 26,552.91 N/A 131,822 174 8/ 1/09 27,9G~.49 1x239.98 26,725.51 N/A 164,836 - 175 9/ 1/09 27,965.49 1,066.27 26,899.22 N/A 137,712 176 10/ 1/09 27,965.49 891.42 27,074.07 N/A 110,449 177 11/ 1/09 27,965.49 715.44 27,250.05 N/A 83,047 178 12/ 1/09 27,965.49 538.31 27,427.17 N/A 55,SOG - 179 1/ 1/10 27,965.49 360.04 2'1,605.45 N/A 27,823 Aso 2/ 1/10 2?,965.49 1$0.60 27,784.88 -. 5,033,7H7.S7 2.071,78?.57 2,962,000.00 The above schedule n ains $211,785.00 in Capitali~efl lrltere - ngxeed to by : ~'~'"~z'-~~.-„ Date : ~ ~t~' ~' Title : ~=~'c'.~.,, G2 ~-~.,~`- L~ EXHIBIT "C" STATE OF TEXAS § COUNTY OF KERB § ESSENTIAL USE AND SOURCE OF FUNDS CERTIFICATE This Exhibit is attached and made a part of the Lease-Purchase Agreement dated as of _ March 31, 1994, between ReCor, Inc., as Lessor, and the Kerr County Juvenile Board, as agent for Kerr County, Texas (the "Board"), as Lessee. All capitalized terms used herein and not otherwise defined shall have the same meaning as used in the Lease. This confirms and affirms that the Leased Premises is essential to the function of the undersigned and to the service we provide our citizens. Further, we have an immediate need for, and expect to make immediate use of, substantially all of the Leased Premises which is not temporary or expected to diminish in the foreseeable - future. The Leased Premises will be used by us only for the purpose of performing one or more of our governmental or proprietary functions consistent with the permissible scope of our authority. Specifically, the Leased Premises was selected by us to be used as a secure juvenile - detention facility (the "Facility"). The secure juvenile detention facility program is a vital link in the statewide initiative to divert juvenile violators from state facilities and allow them to return to the local community as productive and law abiding citizens. Therefore, the Board has agreed that it shall make timely requests for funds from the State Legislature through the Texas Juvenile Probation Commission ("TJPC"), when and as consistent - with TJPC policies and procedures in effect from time to time and funds are available for such purposes, to enable the Lessee to make all payments under the Lease, or to pay Lessee's obligations under the Lease, or for direct payment of amounts pursuant to Interlocal Contract. -' Lessee further agrees that in the event such funds are appropriated by the Legislature and provided to Lessee by the TJPC, Lessee shall utilize such funds to maintain and satisfy its obligations pursuant to the Lease. The Board has further agreed that it shall place juvenile offenders from the County, who are _ placed and confined in the custody of the Board by court order, in the Facility and that it shall work to obtain Interlocal Contracts with other jurisdictions that have responsibility for juvenile offenders and access to funds from the State Legislature through the TJPC for the housing and _ placement of juveniles. The Board will seek Interlocal Contracts to enable the Lessee to make all payments under the Lease from TJPC funds appropriated directly to the Board therefor and/or to jurisdictions contracting to place juveniles in the Facility. The funds, if any, appropriated and _ received directly from TJPC for the purpose of paying Lessee's obligations under the Lease and funds available from Interlocal Contracts will be applied to the Lease obligations. The sources of funds for the payment of all the obligations of Lessee under the Lease will be the revenues actually received from the housing of juveniles that are in the custody and "' jurisdiction of the Board, pursuant to court order or Interlocal Contracts with other jurisdictions. The funding for the Board and other entities to house residents at the Facility derives from discretionary appropriations to the Board and other entities and from funds provided by the State _ Legislature through the TJPC. The TJPC has agreed that it will take the steps required to have funds appropriated by the State Legislature in each biennium and to actively pursue the _ requirements necessary for appropriations during the term of the Lease. The estimated useful life of the Leased Premises based upon our projected needs is in excess _ of twenty (20) years. Our source of funds for payments of the Rental Payments due under the Lease for the current fiscal year is appropriations from the State of Texas. We expect and anticipate adequate funds to be available for all future Rental Payments due after the current _ fiscal year. - LESSEE: Kerr County Juvenile Board, as agent for Ken County Texas. By: Name: - Title: William G. Stacy Chairman of the Board _ By: Name: Simon J. Harris Title: Chief Juvenile Probation Officer LEASE # ASSIGNMENT OF LEASE AGREEMENT TO: CHIC-ORP FINANCIAL SERVICES, INC. RE: Lease between the Kerr County Juvenile Board, as agent for Kerr County, Texas, as Lessee, and the undersigned, as Lessor, dated as of November 15, 1993. For value received, the undersigned, ReCor, Inc. ("Assignor"), hereby sells, assigns, -' transfers and sets over to ChiCorp Financial Services, Inc., its successors and assigns ("Assignee"), WITHOUT RECOURSE as to the financial ability of the Lessee to pay, the _ above-named Lease ("Lease"), together with all rental payments due and to become due thereunder, and all moneys due and to become due in connection with the exercise by Lessee of an option, if any, to purchase the property described in the Lease. All capitalized terms used herein and not otherwise defined shall have the same meanings as set forth in the Lease. Assignor also assigns to Assignee all of Assignor's rights and remedies under the Lease, _ including the right to take, in Assignor's or Assignee's name, any and all proceedings, legal, equitable or otherwise, that Assignor might otherwise take save for this Assignment. It is acknowledged that Assignee has paid full value for this assignment and that Assignee's rights _ shall include, but not be limited to, the right to exercise Lessee's purchase option in the event of default by Lessee and termination of the Lease and the eviction of or vacation of the property by Lessee. As security for all amounts due under the lease, and all other present and future indebtedness or obligations of Assignor to Assignee of every kind and nature whatsoever - associated with the Lease or the Lessee, Assignor hereby grants to Assignee a security interest in all real and personal property covered by and described in the Lease. Title to all such property shall remain in the Assignor and is not transferred to Assignee for any purpose. Upon payment in full of the Rent Payments and discharge in full of the Lease obligations, this Assignment shall become and be void and of no effect and the Assignee shall issue a written - release of this assignment in recordable form; provided that the affidavit, certificate, letter or statement of any officer, agent or attorney of the Assignee showing any part of the Indebtedness to remain unpaid or any of the Lease obligations to be unfulfilled shall be and constitute `- conclusive evidence of notice of the validity, effectiveness and continuing force of this Assignment and any person may, and is hereby authorized to, rely thereon. The Assignor hereby authorizes and directs the Lessee and any other or future occupant as Lessee of the Lease - Premises or any part thereof to pay over to the Assignee all Rent Payments and to continue so to do until otherwise notified by the Assignee. Lessee is authorized to rely on written notices from Assignee as conclusively establishing the fact, circumstance, condition, or event of default by Lessor, and Lessee shall have no duty to inquire or ascertain whether any such fact or event of default actually exists. It is further specifically provided that Assignee shall have no - obligation of Assignor as Lessor under the Lease. Assignor warrants that: Assignor is the owner of the property described in the Lease free from all liens and encumbrances except as set forth in the Title Policy for said property and the Lease; the Lcase is the only document executed between Lessor and Lessee concerning the property described in the Lease; the Lease is genuine and enforceable and is and will continue - free from defenses, set-offs and counterclaims; all signatures, names, addresses, amounts and other statements of fact contained therein are true and correct; the aggregate unpaid rental shown therein is correct; and the Assignor will comply with all its warranties and other obligations with - respect thereto; the Lease transaction conforms to all applicable laws and regulations; the Lease constitutes and will continue to constitute a valid reservation of unencumbered title to or first lien upon or security interest in the property covered thereby, effective against all persons; if _ filing, recordation or any other action or procedure is permitted or required by statute or regulation to perfect such reservation of title, lien or security interest, the same has been accomplished. If Assignor breaches any of the foregoing it will, upon Assignee's request, _ promptly repurchase the Lease for an amount equal to the unpaid rentals thereon, including accrued interest, plus any expenses of collection, repossession, closing costs, transportation and _ storage incurred by Assignee, less any customary refund by Assignee of unearned charges. Assignor agrees that Assignee may in Assignor's name endorse all remittances received, and Assignor gives express permission to Assignee to release, on terms satisfactory to Assignee or _ by operation of law or otherwise, or to compromise or adjust any and all rights against and grant extensions of time of payment to Lessee, or any other person, on any obligation of the Lease or on any accompanying guaranty, or to agree to the substitution of a lessee, without notice to _ Assignor and without affecting Assignor's obligations hereunder. Assignor shall have no authority to, and will not, without Assignee's prior written consent, accept payments of rentals or option prices, repossess or consent to the return of the property described in the Lease or _ modify the terms thereof. Assignee's knowledge at any time of any material breach of or non- compliance with any of the foregoing shall not constitute any waiver by Assignee. Assignor waives notice of acceptance hereof. EXECUTED this the 30th day of March, 1994 ATTEST: -7 B Corporate Secretary [Seal] Assignment of Lease - ~, `~~:~ `/ ~~ ~..v /~~~i ~~~ ` Lessor-Assignor: ReCor, In . By: Name: Glen Heckman Title: President 2 STATE OF TEXAS § COUNTY OF TRAVIS § -- This instrument was acknowledged before me on this theme day of-~ie'r, , by Glen Heckman, President of ReCor, Inc. , a Texas core ation, for said corporation. Notary Public, State of Texas ~.~ ~~` P~~~ A ~9~2~ 7tl V 1~ e• ~,~t hL'taa,r ~'L'~IIC, Satz. ~^~ e~'ls ~,,~, „ I~iy Co~ranlsslon ~xalres ~''':o. %'~ JANUARY J, IJ95 _ Assignment of Lease 3 !D STATE OF TEXAS COUNTY OF KERR NOTICE OF ASSIGNMENT AND REQUEST Recor Inc., ("Lessor") hereby gives notice to Kerr County Juvenile Board, as agent _ for Kerr County, Texas ("Lessee") that Lessor has assigned all of its rights to the payments due under the Lease, dated as of March 31, 1994, between Lessor and Lessee (the "Lease") to Chicorp Financial Services, Inc. , 208 South Lasalle Street, Chicago, Illinois 60604. Lessor hereby requests, gives notice and instructs Lessee that payments that hereafter come due pursuant to the Lease be paid to Chicorp Financial Services, Inc. 208 South Lasalle - Street, Chicago, Illinois 60604 or its Assignee. Lessee hereby acknowledges that as of April 1, 1994 there will be 180 lease payments of Twentyseven Thousand Nine Hundred Sixtyfive and 49/100 Dollars ($27,965.49) remaining to be paid under the Lease-Purchase Agreement with the first payment due March 1, 1995 and continuing through the payment due February 1 2010. DATED this 30th day of March, 1994. - ReCor Inc (Lessor) By: - Name: Glen Hec an Title: President A- - --- By.: corporate Secretary (SEAL) ACKNOWLEDGED AND AGREED this the 30th day of March, 1994 Kerr County Juvenile Board (Lessee) ~. By• f - By: ~~~~-~- Name: William G. Stacy Name: Simon J. Harris Title: Chairman Title: Chief Juvenile Probation Officer ,.:~,,, -, . ~ ; ,l j b~ ~~' ~-, t ,:, ,,,~ LESSEE BILLING AND INVOICING INSTRUCTIONS. LESSEE: PLEASE COMPLETE THIS SECTION OR FURNISH UNDER SEPARATE COVER sluing Address: 700_~7ain, i~errville, Texas 78028 sluing contact: Z~Y Tc~rllirison 210/396-1337 210/896-7380 74-6001494 Phone Number Fax Number Federal Tax ID Number: - Contraa/Purchase Order/Requisition Number [o be included on invoice None - Other special invoicing instructions:. J~ ESCROW AGREEMENT RELATING TO THE KERB COUNTY JUVENILE FACILITY THIS ESCROW AGREEMENT Relating to the Kerr County Juvenile Facility (the "Escrow Agreement"), is made as of the 31st day of March 1994 by and between The Chicago Corporation, a Delaware Corporation ("Escrow Agent"), ReCor, Inc., a Texas corporation ("Lessor"), the Kerr County Juvenile Board, as agent for Kerr County, Texas ("Lessee") and ChiCorp Financial Services, Inc., a Delaware corporation ("CFSI"). Witnesseth that, in the joint and mutual exercise of their powers, and in consideration of the mutual covenants herein contained, the parties hereto recite and agree as follows: _ ARTICLE I. DEFINITIONS AND RULES OF CONSTRUCTION Section 1.01. Definitions. Capitalized terms herein shall have the meanings given them _ in the Lease, as hereinafter defined, except as follows: "Assignment" means the Assignment of Lease-Purchase Agreement, dated as of even date _ herewith, transferring and conveying the Lease from the Lessor to CFSI. "Beneficiary" means the Beneficiary set forth in the Deed of Trust. "Costs of the Project" means (a) obligations of the Lessor incurred, or reimbursement to the Lessor, for labor and to contractors, builders and materialmen in connection with the acquisition, construction and installation of the Project; (b) the cost of contract bonds and of insurance of all kinds that may be required or necessary during the course of construction of the Project which is not paid by the contractor or contractors or otherwise -- provided for; (c) all costs of engineering services, including test bearings, surveys, estimates, plans and specifications and preliminary investigations, and supervising construction, as well as for the performance of other duties required by or consequent upon the proper construction of the Project; and (d) all other costs which the Lessor shall be required to pay, under the terms of any contract or contracts, for the acquisition, construction and installation of the Project. "Deed of Trust" or "Mort~a~e" means the Deed of Trust (with Security Agreement and Assignment of Rents and Leases) dated as of even date herewith from the Lessor to - Victor Elting III, Trustee, as security for performance under the Lease. "Distribution" means any payment received as principal or interest pursuant to the Lease. "Escrow Fund" has the meaning set forth in § 3.01 hereof. "Event of Default" means a default under the Lease, as defined in Article 14 thereof. - "Lease" means that certain Lease-Purchase Agreement between the Lessor and Lessee, dated as of March 31, 1994, together with all riders, exhibits, addenda, amendments and supplements thereto. "Owner" means CFSI, its successors and assigns, the owner of the Mortgage and Lease pursuant to the Assignment. "Payment Date" means any payment due dates as set forth in the Schedule of Payments attached hereto as Exhibit "A" . "Payments" means all payments due and to become due under the Schedule of Payments attached hereto as Exhibit "A" . "Principal Office", means the principal office of the Escrow Agent situated at 208 South LaSalle, Chicago, IL 60604. "Project" means the acquisition, construction and equipping of the Property. "Pr pert.X" means the property set forth in the Deed of Trust. _ "Rental Deposit" means a dollar amount equal to three (3) Rental Payments. "Requisition Certificate" means a certificate in the form attached as Exhibit "B". ARTICLE II. RECITALS AND REPRESENTATIONS - Section 2.01. Assignment. The Lessor shall execute and deliver the Assignment to CFSI and CFSI shall contemporaneously deposit with the Escrow Agent a portion of the proceeds to be derived from the transfer and sale of the Lease by CFSI to its assignee. Section 2.02. Lease. The Lessor and the Lessee have entered into the Lease whereby the Lessor has agreed to lease the Property to the Lessee and the Lessee has agreed to lease the - Property from the Lessor. Under the Lease, the Lessee is obligated to pay to the Lessor or its assigns Rental Payments for the lease of the Property. _ Section 2.03. Assignment and Security for Benefit of Owner. As security for the payments coming due under the Lease, the Lessor will convey the Property and assign all of its right, title and interest in and to the Lease, insofar as it relates to such Property and the right Escrow Agreement -- Kerr County Juvenile Facility 2 to receive payments with respect to such Property, to CFSI pursuant to the Deed of Trust and the Assignment of Lease. Section 2.04. Acquisition and Construction. The Lease provides that the Lessor shall cause the Property to be acquired, constructed and installed in accordance with the Lease, and - the Escrow Agent shall not be obligated to assume or perform any obligation of the Lessee or of the Lessor under the Lease with respect thereto or by reason of anything contained in this Escrow Agreement. Section 2.05. Escrow Agent. The Lessor agrees to employ the Escrow Agent to receive, apply and disburse the Payments to the Owner, all as hereinafter provided. Section 2.06. Authority to Contract. Each of the parties has authority to enter into this Escrow Agreement and has taken all actions necessary to authorize its execution and delivery by its duly authorized officers signing at the signature page hereof and the performance of its respective obligations hereunder; provided that the obligations of the Lessee shall be _ limited to the proceeds from the sale of the Lease and to appropriations, if any, made and received by the Lessee. - Section 2.07. 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 required by law, and the parties hereto are now fully empowered to execute and enter into this Escrow Agreement. ARTICLE III. ESTABLISHMENT AND ADMINISTRATION OF FUNDS AND ACCOUNTS Section 3.01. Establishment of the Escrow Fund. (a) The Escrow Agent shall establish an Escrow Fund which shall consist of various accounts as provided for herein and as specified in a letter of instruction to the Escrow Agent from the Lessor and CFSI or its assignee. These accounts shall include (but not be limited to) an Acquisition Fund, a Construction - Account, a Payment Account and a Redemption Account. The Escrow Agent shall further establish a Tax and Insurance Escrow Account upon request of the Owner. - (b) Upon execution of this Escrow Agreement, the Lease, the Assignment and Notice of Assignment, the Escrow Agent shall deposit $ 2,962,000.00 into the Acquisition Fund held by Escrow Agent for paying the costs of the land, development, legal and financing expenses - and to establish the accounts and funds hereinafter provided in this Article and the Escrow Agent shall promptly pay and disburse therefrom Lessee's and CFSI's legal fees and all the costs, underwriting fees and expenses of CFSI. Escrow Agreement - Kerr County Juvenile Facility 3 (c) Thereafter, upon written notice from CFSI to Escrow Agent that CFSI is in receipt of: (i) properly executed Interlocal Cooperation Agreements for 24 beds in the Facility - (including the beds to be used by Lessee); (ii) an executed Operation and Management Agreement between ReCor, Inc. and Lessee; and (iii) the Mortgagee Title Policy, Deed of Trust, required certificates, opinions and miscellaneous financing documents, all acceptable to CFSI, - the Escrow Agent shall fund and disburse the the costs and expenses for acquisition of the land and listed in a closing statement executed by each of the parties to the closing and approved by CFSI, and shall allocate the balance of the Acquisition Account as follows: (1) $211,785.00 to ~' the Payment Account as capitalized interest for the payment of interest on the Facility during construction; (2) $83,896.47 to the Payment Account as the Rental Deposit; and (3) the balance of the Acquisition Fund to the Construction Account. Section 3.02. The Construction Account. Within the Escrow Fund, there shall be _ established a special account to be designated as the "Construction Account. " Disbursements of moneys in the Construction Account shall be made no more frequently than once each month for Costs of the Project, provided that at the time of each such disbursement (1) no Event of _ Default, or event which, with the giving of notice or lapse of time or both, would be an event of default, exists under this Agreement, (2) no litigation or proceedings are pending or threatened (including proceedings under Title Eleven of the United States Code) against the _ Lessor, the Project or the contractor, which litigation or proceedings are material (or which, in the case of the contractor, could materially affect the completion of the Project); and (3) the Escrow Agent has received a properly executed draw request in the same form as attached hereto _ as Exhibit "B" . Disbursements shall be made promptly by the Escrow Agent as instructed in the draw request. Section 3.03. Certificate as to Completion. The completion date of the Project and the payment of the Costs of the Project shall be evidenced to the Escrow Agent by (a) a permanent certificate of occupancy or its equivalent for the Project from all applicable governmental authorities having jurisdiction over the premises, together with any other necessary governmental approvals; and (b) certifications that the Project has been fully and finally completed in accordance with Lessee's specifications as evidenced by a properly executed draw - request in the form of Exhibit "B" indicating that the request is the final request from Lessor. Section 3.04. The Payment Account. (a) Within the Escrow Fund, there shall be - established a special account to be designated as the "Payment Account." Subject to the Owner exercising the Option provided in Section 5.03 hereof, such account shall be maintained by the Escrow Agent until all Payments are paid in full pursuant to the terms of the Lease. Any - payment made by the Lessor and/or Lessee to the Escrow Agent shall be immediately deposited by the Escrow Agent in the Payment Account. Additionally, notwithstanding the Section 5.03 Option, a portion of the proceeds from the sale of the Lease to CFSI equal to the Rental Deposit _ shall be deposited in the Payment Account. Payments received by the Escrow Agent shall be first applied in whole or in part as necessary to replenish and maintain the Rental Deposit. Escrow Agreement Kerr County Juvenile Facility 4 (b) The Escrow Agent shall withdraw from the Payment Account, on each Payment Date, an amount equal to the amount of principal and interest payments due with respect to the - Lease on such Payment Date, and shall cause the same to be applied to the payment of principal and interest payments due with respect to the Lease on such Payment Date. Except as is necessary to pay any delinquent Payments, an amount equal to the Rental Deposit shall be reserved in the Payment Account until the final payment is made of all amounts owed to the Owner under the Lease. - (c) To the extent that, on the final Payment Date with respect to the Lease, the balance in the Payment Account for the Lease exceeds the amount due to the Owner under this Section 3.04, then such excess shall be applied first to any delinquent Distributions or deficiencies due the Owner and the remainder to the Lessor. Such excess shall include, without limitation, the Rental Deposit reserved pursuant to subsection 3.04(a) of this Escrow Agreement. _ Section 3.05. The Redemption Account. Within the Escrow Fund, there shall be established a separate account designated the "Redemption Account" . Moneys to be used for redemption of the Lease shall be deposited in the Redemption Account and shall include: _ proceeds of insurance or condemnation; all other moneys, exclusive of the Rental Deposit, derived from the lease, sale, sublease or other disposition of the Property; and such other _ amounts as may be paid to the Escrow Agent in respect of the Property, other than as provided for in Sections 3.02, 3.04 and 3.06 of this Escrow Agreement. Except for insurance or condemnation proceeds applied to repair or replacement of Property under the terms of the Deed _ in Trust, said moneys shall be set aside in the Redemption Account solely for the purpose of redeeming all or part of the Lease in advance of its maturity and shall be applied to the payment of principal and interest with respect to the Lease to be redeemed upon presentation and _ surrender of such Lease. To the extent that the balance in the Redemption Account exceeds the amount needed to _ redeem the Lease in accordance with this Section, then such excess shall be applied first to any delinquent Distributions or deficiencies due any Owner and the remainder to the Lessor. -- Section 3.06. Tax and Insurance Escrow Account. Upon the request of the Beneficiary, the Escrow Agent shall establish a Tax and Insurance Escrow Account and Lessor and/or Lessee shall pay to Escrow Agent for deposit into such account funds sufficient to pay all taxes, assessments and insurance premiums for and with respect to the Property. From and after the creation of said account, if any, the Escrow Agent shall accept and use such funds for the purpose of paying the insurance premiums, taxes and assessments on the Property. Section 3.07. Investment of 1~nds. All moneys held by the Escrow Agent in any of the accounts constituting the Escrow Fund established pursuant to this Escrow Agreement shall -' be invested at the written direction of the Lessor in a taxable money market portfolio restricted to obligations with maturities of one year or less, composed of obligations issued or guaranteed Escrow Agreement _ Kerr County Juvenile Facility S as to payment of principal and interest by the full faith and credit of the U.S. government or repurchase agreements secured by U.S. government obligations. ARTICLE IV. RESPONSIBILITIES OF THE ESCROW AGENT Section 4.01. Filin s. CFSI and the Lessor shall provide a completed I.R.S. Form W-8 or Form W-9 to the Escrow Agent at the signing of this agreement. The Escrow Agent may delay accepting escrow funds or property until the I.R.S. forms have been provided. For -" purposes of reporting to tax authorities, the Escrow Agent will report all income earned by the escrow as paid upon distribution. Lessor agrees to indemnify and hold the Escrow Agent harmless against all liability for tax withholding and/or reporting for any payments made by Escrow Agent pursuant to the Escrow Agreement. Such indemnity shall survive the termination or discharge of this Escrow Agreement or resignation of the Escrow Agent. Section 4.02. Amendment. No amendment, modification or addition hereto shall have effect or be binding unless in writing and executed by all of the parties hereto or their respective duly authorized representatives. Section 4.03. Limited Duties. The Escrow Agent shall have no duties or obligations except those expressly set forth in this Escrow Agreement, and no implied duties or obligations shall be read into this Escrow Agreement against the Escrow Agent. The Escrow Agent shall have no responsibilities or liability to any of the parties hereto or their successors for any action _ taken by it in good faith upon receipt of any instruments or other writing believed by it to be properly signed or presented. In case any property deposited under this Escrow Agreement shall be attached, garnished or levied upon pursuant to an order of court or other authority having jurisdiction, or the delivery thereof shall be stayed or enjoined by an order of court, or any order, judgment or decree shall be made or entered by any court affecting such property, or any part thereof, the Escrow Agent shall obey and comply with all final writs, orders, judgments or decrees so entered or issued by any court, without the necessity of inquiry whether such court had jurisdiction; and, with respect to such writ, order, judgment, or decree, the Escrow Agent shall be held harmless and indemnified by the parties hereto, jointly and severally, by reason of such compliance. Upon receipt of notice of an order, writ, judgment or decree, the Escrow Agent will transmit copies of said writ, other process or pleading received to all parties hereto. Section 4.04. Obligation to Make Pavment. The Escrow Agent shall have no obligation to make any payment or disbursement of any type pursuant hereto or to incur any financial liability in the performance of its duties hereunder unless there shall have been deposited with the Escrow Agent sufficient funds therefor. Escrow Agreement ,_ Kerr County Juvenile Facility f) Section 4.05. Indemnification of The Escrow Agent. The Escrow Agent may conclusively rely upon and shall be protected, indemnified and held harmless by Lessor and ._.. CFSI in acting upon the written (which shall include, without limitation, instructions given by facsimile or other telecommunications device) or oral instructions of any officer or authorized representative of either of them or of counsel to either of them with respect to any matter relating to its actions as Escrow Agent hereunder, and the Escrow Agent shall be entitled to request that further instructions be given in writing. Section 4.06. Reliance on Representations. In performing its duties under this Escrow Agreement, the Escrow Agent is authorized to conclusively rely upon any statement, consent, request, requisition, agreement or other instrument not only as to its due execution, its validity, - and the effectiveness of its provisions, but also as to the truth and accuracy of any information contained therein, which the Escrow Agent shall in good faith believe to be genuine or to have been represented or signed by a proper person or persons. The Escrow Agent shall not be liable _ for any error or judgment made in good faith by an officer of the Escrow Agent, unless it shall be proved that the Escrow Agent was grossly negligent in ascertaining the pertinent facts or acted intentionally in bad faith. The Escrow Agent shall have no liability for any action or omission to act with respect to its duties under this Escrow Agreement undertaken in good faith reliance upon the advice of its counsel. Section 4.07. Fees and Expenses. Lessor shall reimburse the Escrow Agent directly for all out-of-pocket expenses incurred by the Escrow Agent in connection with the negotiation, preparation and execution of this Escrow Agreement or in the performance of its duties as Escrow Agent hereunder, including, but not limited to the reasonable fees of its counsel in reviewing this Escrow Agreement or in performing other legal services in connection herewith, _ and including specifically but without limitation any legal or other expenses with respect to any action for interpleader by the Escrow Agent. Lessor and CFSI shall, in addition, pay the fees and expenses to the Escrow Agent directly in accordance with Exhibit "C" attached hereto. _ Section 4.08. Extraordinary Expenses by Escrow Agent. Lessor covenants and agrees to indemnify the Escrow Agent and hold it harmless against any loss, liability or expense arising _ out of or in connection with the performance of its duties hereunder, including, but not limited to, legal and other fees and expenses and including specifically but without limitation, any legal or other expenses with respect to any action for interpleader by the Escrow Agent, except that _ the Escrow Agent shall not be indemnified against any such loss, liability or expense arising out of its gross negligence or willful misconduct. The Escrow Agent shall be under no obligation to institute or defend any action, suit or legal proceeding in connection herewith, unless first indemnified and held harmless to its satisfaction in accordance with the foregoing. Such indemnity shall survive the termination or discharge of this Escrow Agreement or resignation of the Escrow Agent. Section 4.09. Notices. All notices, reports, instructions, requests and other communications given under this Escrow Agreement shall be either (i) sent in writing and served Escrow Agreement Kerr County Juvenile Facility 7 personally by delivery to a responsible officer at the party's offices listed on the signature pages hereto or delivered by first class, registered or certified United States mail, return receipt - requested, postage prepaid; or (ii) sent by facsimile and then acknowledged as received by return facsimile by the intended recipient. Notices shall be directed to the addresses or facsimile numbers as follows: To Lessor: RECOR, Inc. 5912 Balcones Drive, Suite 250 -' Austin, Texas 78731 Phone (512) 452-6477 FAX (512) 452-9604 To Lessee: Kerr County Juvenile Board 624 Jefferson Kerrville, Texas 78028 _ Attention: Chief Juvenile Probation Officer Phone: (210) 896-2202 Fax: (210) 896-7380 To CFSI: ChiCorp Financial Services, Inc. 208 South LaSalle _ Chicago, IL 60604 Attention: Romona Regas, Vice Pres. Phone: (312) 855-4162 Fax: (312) 855-6002 with a copy to: Bickerstaff, Heath and Smiley, L.L.P. 98 San Jacinto Center #1800 _ Austin, Texas 78701 Attention: Barney Knight Phone (512) 472-8021 FAX (512) 320-5638 To Escrow Agent: The Chicago Corporation 208 South LaSalle Chicago, IL 60604 Attention: Victor Elting, Sr. Vice Pres. Phone: (312) 855-5882 Fax: (312) 855-6002 A party may change its address or numbers for notices under this Escrow Agreement by giving written notice to the other party in accordance with this paragraph. Escrow Agent shall have - no responsibility for or duty to notify any party hereto or any other party of any payment required or maturity occurring under this Escrow Agreement or under the terms of any instrument deposited herewith unless such notice is explicitly provided for herein. Section 4.10. Resignation of Escrow Agent. The Escrow Agent may resign at any time by giving ten days written notice to Lessor, Lessee and CFSI at the addresses below. On the Escrow Agreement Kerr County Juvenile Facility 8 effective date of such resignation, the resigning Escrow Agent may deliver to any Escrow Agent appointed by Lessor and CFSI, all documents and money held hereunder, and thereupon the - Escrow Agent will be released of any further responsibility or obligation in connection with the funds held in Escrow under this Escrow Agreement. - Section 4.11. Contlictin~ Demands. In the event of any conflicting demands, disagreements or disputes arising out of the subject matter of this Escrow Agreement or should the Escrow Agent resign and the Lessor and CFSI fail to select another Escrow Agent to act in - its stead, the Escrow Agent shall have the right, at its option, to refuse to comply with any claims or demands on it, or refuse to take any other action hereunder, so long as such disagreement continues; in doing so the Escrow Agent shall not be or become liable for damages - or interest to Lessor, Lessee or CFSI or to any persons for its failure to comply with such conflicting or adverse demands. The Escrow Agent may continue to so refuse to act until (i) the rights of the adverse claimants have been finally adjudicated in a court assuming and having - jurisdiction; or (ii) all differences have been settled by mutual agreement and the Escrow Agent shall have been notified thereof in a writing signed by all interested persons. Alternatively, the Escrow Agent may file a suit in interpleader for the purpose of having the respective rights of the claimants adjudicated, and deposit with the court all funds and documents held hereunder. Section 4.12. Governing Law. This Escrow Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Texas. Venue shall be in Kerr County, Texas. This Escrow Agreement, together with the attached Exhibits and the _ documents referred to herein, constitutes the entire agreement among the parties pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements and undertakings of the parties in connection herewith. All of the terms, covenants, conditions and provisions of this Escrow Agreement shall bind and inure to the benefit of the parties hereto and to their respective successors and assigns. No failure or delay on the part of the Escrow Agent in exercising any right, power or remedy may be, or may be deemed to be, a waiver thereof; nor may any single or partial exercise or any right, power or remedy preclude any other or further exercise of any other right, power or remedy. In the event one or more provisions of this Escrow Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Escrow Agreement shall not be affected or impaired. Each of the parties hereto shall, at the request of the other party, deliver to the requesting party all further documents or other assurances as may reasonably be necessary to give full affect to this Agreement and to allow each party fully to enjoy and exercise the rights accorded to it under this Agreement. This Escrow Agreement may be executed in any number of counterparts, each of which shall be an original and all of which shall be deemed to be one - and the same instrument. Escrow Agreement _ Kerr County Juvenile Facility 9 ARTICLE V. - ADMINISTRATIVE AND MISCELLANEOUS Section 5.01. Escrow Agent to Keep Records. The Escrow Agent shall keep a copy - of this Escrow Agreement on file and will provide. its standard accounting statements to the Lessor, Lessee and CFSI on a monthly basis. The foregoing shall be available for inspection by the parties hereto upon reasonable notice during regular business hours. Section 5.02. Escrow and Delivery of Deed. Upon acceptance of the Project and all the Property by the Lessee pursuant to Section 3.03 of this Escrow Agreement, the Lessor shall - execute and place in escrow with the Escrow Agent a warranty deed, in the form and substance of Exhibit "D" attached hereto and made a part hereof for all purposes (the "Deed"), to be held _ in escrow by the Escrow Agent and delivered to the Lessee upon Lessee exercising the purchase option as provided in Article 18 of the Lease. In the event the Lease is otherwise lawfully terminated the Escrow Agent shall deliver the Deed to the Owner or the Lessor as directed in - writing by the Owner or the Lessor. Section 5.03. Owner Payment Option. Notwithstanding any other provision herein, _ the Owner shall have the option to require that Payments be made directly to the Owner (the "Option"). The Option may not be exercised until the certifications of final completion have been made and all Costs of the Project paid as provided in § 3.03. The Owner may exercise _ the Option only by giving written notice to Lessor, Lessee and the Escrow Agent directing that payments be made to the Owner. After exercising the Option the Owner shall keep all Payment records and this Escrow Agreement shall otherwise remain in full force and effect and the Escrow Agent shall continue to hold the Rent Deposit and Deed. IN WITNESS WHEREOF, the parties have executed and attested this Escrow Agreement by - their officers thereunto duly authorized as of the date and year first above written. KERR COUNTY JUVENILE BOARD, THE CHICAGO CORPORATION, - as Agent for K County, Texas as Escrow Agent - Name: William G. S cy Name: G~c 7'G` ~« ~'~ =% Title: Chairman of the Board Title: ~~_ -~- /~ - CHICORP FINANCIAL SERVICES, INC. RECOR, INC. By: ,.~ ~ By: ~r~.,., Name: Ramona Regas CJ Name: Glen Heckman Title: Vice President Title: President Escrow Agreement - Kerr County Juvenile Facility EXHIBIT "A" AMORTIZATION SCHEDULE & PURCHASE OPTION Escrow Agreement Kerr County Juvenile Facility -" UJ-LU~~4 !L• 11I1Y1 PRUlYl !U ~/ 1JILJLUJUJG URIVUAI I'11VH1Vt,1HL fUUL/UUJ ' ExlTibit B -- Payment Schedule Number 1 __ Real Prope rty Le ase-Purchase Agreement Lessee : Ke rr County Juvenile Deten>;ion Fac:iia.ty, Tx Interest Furchase "- Pmt Payment Portion of Option Stipulated No. Dace Amount Payment PrYncipa3 Price Loss Value 1 3/ 1/95 27.965.45 19,253.00 'x,712.49 Y N/A~ ^3,276,455 "` 2 4j 1/95 27,965.49 19,3.96.37 8,769.12 NJA 3,265,213 3 5/ 3./95 27,965.49 1.9,139.37 8,826.12 N/A 3,253,914 4 6/ 1/95 27,965.49 19,082.40 8,1383.49 N/A 3,242,557 5 '~/ 1/95 27,965.49 19,024.26 8,941.23 N/A 3,231,142 6 8i 1/95 27,965.49 18,966.14 8,999.35 N/A 3,219,669 7 9/ 1/95 2'7,965.49 18,907.64 9,057.84 N/A 3,208,137 8 10/ 1/95 27,965.49 18,848.77 9,116.72 NjA 3,196,546 _ 9 11/ 1/95 27,965.49 18.789.51 9,x?5.98 N/A 3,184,897 ~a 12/ 1/95 2"1,965.49 18,729.86 9,235.62 N/A 3,173,187 11 1/ 1/96 27,965.49 18,669.83 9,295.65 N/A 3,161,415 12 2/ 1/96 27,965.49 18,609.41 9,356.07 NJA 3,149,589 13 3/ 1/96 27,965.49 18,548.60 9,426.89 N/A 3,137,700 14 4/ 1/96 27,96x.49 18,487.39 9,478.10 N/A 3,125,750 _ 15 5/ 1/96 27,965.49 18,425.78 9,539.71 NJA 3,1,13,739 16 6/ 1/96 27,965.Q9 18,363.77 9,601.71 N/A 3,101,666 1? 7/ 1/96 27,965.49 18,301.36 9,664.13 lv/A 3,089,532 18 e/ 1/56 x7,965.49 18,238.54 9,726.94 N/A 3,077,336 _ 19 9/ 1/96 27,965.49 18,175.32 9,790.17 N/A 3,065,078 20 10/ 1/96 27,965_x9 18,111.68 9,853.80 N/A 3,452,757 Z1. 11/ 1/96 27,965.49 3.8,047.63 9,917.$5 N/A 3,040,373 22 12/ 1/96 27,965,49 X7,983.17 9,982.32 N/A 3,027,926 . 23 ~ Z/ 1/97 27,965,49 17,918.28 10,047.20 N/A 3,415,416 - 24 2/ 1/97 27,965.49 17,852.97 10,112.51 N/A 3,002,842 25 3/ 1/97 27,965.49 17.787.24 x0,178.24 tv/A 2,990,203 - .'~.6 4/ 1/97 27,965.49 17,721.08 10,244.40 N/A 2,977,500 27 5/ 1/97 27,965.49 17,654.50 10,314.99 N/A 2,9F,4,732 28 6/ 1/97 27.965.49 17,587.4'7 10,3%!3.01 N/A 2,951,899 ,._ 29 7/ 1/97 27,965.49 17,520.02 10,445.47 N/A 2,939,001 30 8/ ]./97 27,965.49 17,452,12 10,513.36 N/A 2,926,036 31 9/ ]/97 2'7,9G5,49 17,383.79 10,581.70 NiA 2,913,006 32 10/ 1/97 27,965.49 3.7,315.00 10,650.48 N/A 2,899,909 33 11/ 1/97 27,965.49 3.7,245.7F1 10,719.71 N/A 2,886,745 34 Z2/ 1/97 27,965.49 17,176.10 10,789.39 N/A 2,873,514 35 1/ 1/98 27,965.49 3.7,105.97 10,859.52 N/A 2,960,215 .- 36 2/ 1/9$ 27,965.49 17,035.38 10,930.11 N/A 2,846,849 3'7 3/ 1/98 27,965.49 16,964.33 11,001.15 N/A 2,833,424 38 4/ 1/98 27,965.49 16,892.83 11,072.66 N/A 2,819,911 39 5/ 1/98 27,965.49 16,F320.$5 7.1,144.63 N/A 2,$06,339 40 6/ 1/98 27,965.49 16,748.41 11,217.07 N/A 2,792,697 41 7/ 1/98 27,965.49 16,675.50 11,389.98 N/A 2,7?$,98b 42 II/ 1/98 2"/,965.49 16,602.12 11,363.37 N/A 2,765,205 "_ 43 9/ 1/99 27,965,49 26,52$.26 12,437.23 N/A 2,751,:54 44 10i 1/9$ 27,965.49 16,453.91 11x511,57 N/A 2,737,432 45 7.1j 1/98 27,965.49 16,379,09 1.1,586.40 N/A 2,723,438 46 12/ 1/98 27,965,49 16,303.7$ 11,661.71 N/A 2,709,374 47 1/ 1/99 27,965.49 16,227.98 11,737.51 N/A 2,695,237 48 2/ 1/99 27,965.49 1.6,151.68 11,813.84 NJA 2,681,429 49 3/ 1./99 27, 965 .49 16, 074.89 11, $90.59 N/~. 2, 666,748 _ 50 4/ 1/J9 27,965.49 15,997.64 11,967.88 N/A 2,652,394 51 5/ 1199 27,965,49 15,919.81 12,045.67 N/A 2,637,967 52 6/ 1/99 27,965.49 15,941.5? 12,123.97 N/A 2,623,46b 53 7/ 1/y9 27,965.49 15,762.71 12,202.78 NjA 2,60$,891 a V V J/ V V J L V J/ 1 J 1 L J L U J V J V ~_ UJ~LG ~4 1L•1111Y1 fnUlYi LIIl~~~nL 1'1lrniv~ini E3ciiibit B - Payment Schedule Number Z -` Real Prope rty Lease-Purchase Agreement Lesse e: Ke rr County Juvenile Detention Facility, TX Interest Purchase Pmt Payment Portion of optic,n stipulated NO. Date Amount Fayment PrinCa.pal FriCe Loss Value 54 8/ 1/99 27,965.49 15,683.39 12,282.09^ r N/A 2,594,242 _ 55 9/ 1/99 27,965.49 15,603.56 12,361.93 N/A 2,579,518 56 10/ 1/39 27,965.49 15,523.21 12,442.28 N/A 2,564,718 57 11/ 1/99 27,965.49 15,442.33 12,523.7.5 "N/A 2,549,844 - 58 12/ 1/99 27,965.49 15,360.93 ].2,604.56 N/A 2,534,893 59 1/ 1/00 27,965.49 15,279.00 12,6$6.49 N/A 2,51y,866 60 ?./ 1/00 27,965.49 15,196.54 12,768.95 N/A 2,504,762 61 3/ 1/00 27,965.49 15,113.54 12,851.95 NjA 2,489,582 _ 62 4/ 1/00 27,965.49 i5,o3o.ao X2,935.48 N/A 2,474,323 63 5/ 1/00 27,965.49 14,945.92 13,03.9.56 N/A 2,458,9$7 64 6/ 1/00 27,965.49 14,861.3Q 13,104.19 N/A 2,443,573 65 7/ 1/00 27,965.49 14,776.12 ].3,189.37 N/A 2,428,080 66 8/ 1/00 27x965.49 14,690.39 13,275.10 N/A 2,412,508 67 9/ ]./00 27,965.49 14,604.10 13,367.39 N/A 2,396,856 68 1.0/ 1/00 27,965.49 14,517.25 13,448.24 N/A 2,381,224 69 11./ 1/00 27,965.49 14,429.84 13,535.65 N/A 2,365,313 70 12/ 3./00 27,965.49 14,341.86 13,G23.63 N/A 2,349,420 71 1/ 1/01 27,965.49 14,253.30 13,77.2.19 N/A 2,333,446 72 2/ 1/O1 27,965.49 24,164.17 13,801.32 N/A 3,317,391 73 3/ ]./OZ 27,965.49 14,074.46 13,891.02 N/A 2,301,254 74 4/ 1/01 27,965.49 7.3,984.17 13,981.,31 N/A 2,285,035 75 5i 3./01. 27,965.49 23,$93.29 14,072.19 N/A 2,268,732 __ 76 6/ 1/O1 27,965.49 13,801.82 3.4,163.66 N/A 2,252,347 77 ~., 7/ 1/O1 27,965.49 3.3,709.76 14,255.73 N/A 2,235,878 _ 78 8/ 1/03. 27, 965 .49 13, 617 ;10 14, 348 .39 N/A 2, 27.9, 324 - 79 9/ 1/01 27,965.49 13,523.83 14,441.65 N/A 2,202,687 $0 14/ 1/01 27,965.49 7.3,429.96 14,535.52 N/A 2,185,964 81 I1/ 1/03. 27,965.49 13,335.48 14,630.00 N/A 2,169,156 82 12/ i/O1 27,965.49 13,240.39 14,725.10 NjA 2,152,262 83 1/ 1/02 27,965.49 13,144.67 14,820.82• N/A 2,135,182 84 2/ 1/02 27,965.49 13,048.34 14,917.15 2,118,216 2,118,216 85 3/ 1/02 27,965.49 12,951.38 15,014.1.1 NjA 2,101,062 86 4/ 1/02 27,965.49 12,853.79 7.5,111.70 N/A 2,083,821 87 5/ 1/02 27,965.49 12,755.56 15,209.93 N/A 2,066,491 88 6/ 1/p2 27,965.49 12,656,69 15,30$.79 N/A 2,049,074 89 7/ 1/02 27,965.49 12,557.19 15,408.30 N/A 2,031,567 90 8/ 1/02 27,965.49 12,457.03 15,508.45 N/A 2,013,971 93. 9/ 1/02 27,965.49 12,356.23 15,609.26 NjA ~,,996,a85 92 ~dJ 3.j02 27,965.49 12,254.77 15,710,72 N/A 1,978,5Q9 - 93 11/ 1/02 27,965.49 12,152.65 15,812.84 N/A 1,960,642 94 12/ 1/42 27,965.49 12,049.87 3.5,915.62 N/A 1,942,684 95 1/ 1/03 27,965.49 11,946.41 16,019.07 N/A 1,924,634 96 2/ X/03 27,965,49 11,842.29 16,123,20 1,906,493 1,906,A93 _ 97 3/ 7./03 27, 9H5.49 11, 737.49 L6, '128.00 N/A 1, 888, 258 98 4/ 1/03 27,965.49 3.1,632.01 16,333,48 NiA 1,869,931 99 5/ 1/03 27,965.49 11,525.$4 16,439.65 N/A 7.,s5Z,510 - 100 ~/ 1/03 27,965.49 21.,418.9$ 1.6,546,50 N/A 1,832,994 ].O1 7/ 1/03 27,965.49 11,311.43 16,654,06 N/A 1,814,385 _.102 8/ 7_/03 27,965.49 7.1,203.18 16,762.31 N/A x,795,680 03 9/ 1/03 27,965.49 11,094.22 16,871.26 N/A 1,776,880 `- 104 a.0/ 1/03 27, 965 .49 3.0, 984.56 16, 980.93 N/A 1, 757, 984 105 11/ 1./03 27,965.49 10,874.1$ 1.7,092.30 N/A 1,738,992 106 1Z/ 1/03 27,965.49 10,713.09 17,202.40 N/A 1,719,902 UJ LU JZ 1L1111M1 lli Ulll U111 ..~.~~ '""'~~~~~•/ ~, ,,, .._v..vvvv~ vvz~ vuv ExYfib it B - Payment Schedule Number 1 •- Real Property Lease~Purchase Agreement Lesse e: Kerr County Juvenile Detention FaGi Xity, TX Interest Purchase l~mt Payment Portion o~ Option Stipulated No. Date Amount Payment Principal Price Loss Value 107 1/ 1/04 27,965.49 10,651.28 17,314.21 N/A 1,700,716 .~ 108 2/ 1/04 27,965.49 10,538.73 17,426.75 1,681,431 1,681,431. 109 3/ 1/0~ 27,965.49 10,425.46 27,540,03 N/A 1,662,046 110 4/ 1/04 27, 965.49 10, 37.1.45 7.'1, 654.04 ~ N/A 1, 642, 566 - 111 5/ 1/04 27,965.49 X0,196.?0 17,768,79 N/A 1,622,9$4 112 6/ 1/04 27,965.49 10,081.20 27,884.29 N/A 1,603,303 113 7/ 1f04 27,965.49 9,964.95 18,000.53 N/A 1,583,521 214 8/ 1x04 27,965.49 9,$47.95 28,117.54 N/A 1,563,638 _ 115 9/ Z/04 27,965.49 9,730.18 18,235.30 N/A 1,543,653 1.15 10/ ~ja4 27,965.49 9,611.66 1.8,353.83 N/A ].,523,567 7.17 11/ 1/04 27,965.49 9,492.36 28,473.13 N/A 1,503,378 - 118 12/ 1/04 27,965.49 9,372.28 18,5y3.21 N/A 1,483,086 119 1/ 7,/05 27,965.49 9,257..42 18, X4.06 N/A 1,462,690 120 2/ 1/05 27,965.49 9,129.78 18,835.70 1,442,191 ~,442,i91 _ 121 3/ 1/05 27,96x.49 g,o07.35 18,958.14 N/A 1,421,586 122 4/ 1/05 27,965.49 8,884.12 19,081.36 N/A 1,400,877 123 5/ 1/05 27,965.49 8,760.09 19,205.39 N/A 1,380,062 124 6/ 1/05 :7,965.49 8,635.26 19,330._23 N/A 1,359,240 - 125 7/ 1/05 27,965.49 8,509.61 19,455,87 N/A 1,338,112 1.26 8/ 1/05 27,965.49 8,383.15 19,582.34 N/A 1,316,976 127 9/ 1/05 27,965.49 8x255.$6 19,709.62 NfA 1,295,733 128 10/ 1/05 27,965.49 8,1.27.75 19,837.73 N/A 1,274,381 129 ~ l1/ 1/O5 27,965.49 7,998.87. 19,966.68 N/A 1,252,920 ••~ 130 12/ 1/05 27,965.49 7,869.02 20,096.46 N/A 1,231,350 131. if 1106 27,965.49 7,738.40 20,227.Os N/A 1,209,670 132 2/ 1./06 27,965.49 7,606.92 20,358.57 1,187,878 1,187,878 133 3/ 1/06 27,965.49 7,474.59 20,49Q.90 N/A 1,165,876 134 4/ 1/06 27,965.49 7,341..40 20,624.09 N/A 1,243,962 135 5/ 1/06 27,965.49 7,207.34 20,758.14 N/A 1,121,835 136 6/ 1/06 27,965.49 7,072.41 20,893.07' N/R 1,099,596 137 7/ 1/b6 27,965.49 6,936.61 21,028.88 N/A 1,077,243 138 8/ 1/06 27,965.49 6,799.92 21,165.57 N/A 1,054,776 _ 139 9/ 1/06 27,965.49 6,662.35 21,303.14 N/A 1,032,194 140 10/ 1/06 27,965.49 6,523.$7 21,441.61 NfA 1,009,497 141 11/ 1/06 27,965,49 6,384.50 21,580.98 N/A 986,684 - 142 12/ 1/06 2?,965.49 6,244.23 21,721.26 N/A 963,755 143 1/ 1/07 2'7,965.49 6,103.04 21,862.45 N/A 940,709 144 2/ 1/07 27,965.49 5,960.93 22,004.55 4.7,545 917,45 145 3/ 1/07 27,965.49 5,817.90 22,147.58 N/A 894,263 ~- 146 4/ 1/07 27,965.49 5,673.94 22,291.54 N/A 870,862 147 . 5f 1/07 27,965.49 5,529.05 22,436.44 N/A 847,341 14f3 6/ 1/07 27,965.49 5,383.21. 22,582.27 N/A 823,701 - X49 7/ 1/0? 27,965.49 5,236.43 22,729.06 NfA 799,939 150 8/ I/07 27,965.49 5,08$.b9 22,876.80 N/A 776,057 1.51 9/ 1/07 27,955.49 4,939.99 23,025.50 N/A 752,053 152 10/ 1/07 27,965.49 4,790.32 23,175.16 N/A 727,926 153 11/ i1o7 27,965.49 4,639.69 23,325.80 N/A 703,674 1.54 12/ 1/07 27,965.49 4-488.07 23,477.42 N/A 679,302 t `.S5 1/ 1./08 27,965.49 4,335.46 23,ti30.02 N/A 554,804 156 2J 1/Oi3 27,965.49 4,181.87 23,7$3.62 630,180 630,180 157 3/ 1./08 27,965.49 4,027.28 23,938.21 1V/A 605,431 158 4/ 1j08 27,965.49 3,871.68 24,093.81 N/A 580,556 a.s9 5/ i/U8 27,965.49 3,715.07 24,250.42 N/A 555,554 - VU~ LU JT 1L 11A iLL l u V/ 1 V 1 LV ~. V uuuv 1 t\Vlu U1111, V 1\1 1 iNUi.a./.~ V U V/ U U V / Exhib it B - payment Schedule Number 1 - Real Propexty Lease-Purchase Agreement _ Lesse e: Kerr County Juvenile Detention Facil ity, TX ~~ Intexest Purchase _ Pmt Payment Pox-ti.on o~ Opticn stipulated . No. Date Amount Payment Principal Price Loss tTalue 160 ~/ 1/os 27, 965'49 3, 5S7 44 z4, 408. os r^-^----N/~- ^ ^530, 424 - 161 7/ 1/08 27,965.49 3,398.79 24,566.70 N/A 505,166 162 8/ 1i0$ 27,965.49 3,239.10 24,726.38 N'/A 479,779 163 9/ 1/08 27,965.49 3,078.38 24,887.10 ~N/A 454,2G2 - 164 10/ I/08 27,965.49 2,916.62 25,048,87 N/A 428,615 x.65 11/ 1/08 27,965.49 2,753.80 25,211.69 N/A 4U2,838 166 12/ 1/08 27,965.49 2,589.92 25,375.56 N/A 376,928 I67 ~ 1/ 1/09 27,965.49 2,424.98 25,540.50 N/A 350,897 _ 168 2/ 1/09 27,965.49 2,259.97 25,706.52 324,712 324,X2 169 3/ i/o9 2'!,965.49 2,091.88 25,873.61 N/A 298,404 170 4/ 1/09 27,965.49 1,923.70 26,041.79 N/A 271,962 171 5/ 1/09 27,965.49 1,754.43 26+211.06 N/A 245,384 17z 6/ 1/09 27,965.49 1,5$4.05 26,381.4 3 N/A 218,671 173 7/ 1/09 27,965.49 1,412.58 26,552.91 N/A x.91,822 174 $/ 1/09 27,9G~.49 1,239.98 26,725.51 N/A 164,836 175 9/ 7./09 27,945.49 1,066.27 26,899.22 N/A 137,712 176 10/ 1/09 27,965.49 891.42 27,074.07 N/A 110,449 177 11/ 1/09 27,965.49 715.44 27,250.05 ~T/A 83,047 - 17$ 12/ 1/09 27,96'5.49 538.31 27,427.17 N/A 55,506 179 1/ 1/14 27,965.49 360.04 2'1,605.45 N/A 27,823 180 2/ 1/10 27,965.49 180.60 27,7$4.88 " ~.. 5,033,787.57 2,071,787.57 2,962,000.00 . The ab ove schedu]„e n ins $211,785.00 in Capitalized inters t _ Agxeed to by: GI' ~ Date: ~ ~ Title; EXHIBIT "B" -- PAYMENT REQUEST FORM TO: The Chicago Corporation (The "Escrow Agent") FROlVI: ChiCorp Financial Services, Inc. ("ChiCorp"); Seabreeze Construction Company ("Contractor/Builder"); ReCor, Inc. ("Lessor"); Bernard Jason Merritt ("Architect"); and Kerr County Juvenile Board ("Lessee") SUBJECT: Escrow Agreement dated as of March 31, 1994, ('The "Escrow Agreement") and _ the Lease-Purchase Agreement, dated as of March 31, 1994, between ReCor, Inc. , as Lessor, and the Kerr County Juvenile Board, Individually and as agent _ for Ken County, Texas, as Lessee, (the "Lease") for the Lease of a juvenile probation facility (the "Facility") _ This represents Requisition Certificate No. _ in the total amount of $ for payment of those Costs of the Facility detailed in the attached payment instructions. _ The undersigned Lessee, Lessor, Architect and Contractor/Builder certify that: 1. All of the expenditures for which moneys are requested hereby represent proper - Costs of the Facility, have not been included in a previous Requisition Certificate and the Contractor/Builder represents that such expenditures have been properly recorded in the Contractor/Builder's books. 2. The moneys requested hereby are not greater than those necessary to meet obligations due and payable or to pay and reimburse the Contractor/Builder for - fees or funds actually earned or advanced for Costs of the Facility. The moneys requested do not include retention or other moneys not yet due or earned under construction contracts. 3. After payment of moneys hereby requested, there will remain available to the Contractor/Builder (from the Acquisition Fund) sufficient funds to complete the substantially in accordance with the Plans. EXECUTED this day of 1994. Seabreeze Construction Company By: Name: John McCabe Title: By: Name: Title: Bernard Jason Merritt, AIA Partner/Principal Escrow Agreement Kerr County Juvenile Facility 1 EXHIBIT "B" -- PAYMENT REQUEST FORM PAGE 2 of 2 The undersigned Lessee and Lessor agree that (i) the above statements are, to the best of its knowledge, true, (ii) the amount of this requisition constitutes a final or partial - acceptance of the Facility; and (iii) that if the final acceptance does not occur prior to 1994 that the unspent construction funds will become the property of the Lessee and that rent will commence pursuant to Article 2 of the Lease-Purchase Agreement. Agreed to this day of 1994. Agreed to this the day of ,1994. Kerr County Juvenile Board, _ Lessee ReCor, Inc., Lessor - By: By: Name: Simon J. Harris Name: Title: Chief Juvenile Probation Officer Title: Approved for payment this the - day of ,1994. ChiCorp Financial Services, Inc. By: Name: Ramona Regas Title: Vice President Escrow Agreement Kerr County Juvenile Facility 2 EXHIBIT "C" _ STATE OF TEXAS § COUNTY OF KERB § ESSENTIAL USE AND SOURCE OF FUNDS CERTIFICATE This Exhibit is attached and made a part of the Lease-Purchase Agreement dated as of _ March 31, 1994, between ReCor, Inc., as Lessor, and the Kerr County Juvenile Board, as agent for Ken County, Texas (the "Board"), as Lessee. All capitalized terms used herein and not otherwise defined shall have the same meaning as used in the Lease. This confirms and affirms that the Leased Premises is essential to the function of the undersigned and to the service we provide our citizens. Further, we have an immediate need for, and expect to make immediate use of, substantially all of the Leased Premises which is not temporary or expected to diminish in the foreseeable - future. The Leased Premises will be used by us only for the purpose of performing one or more of our governmental or proprietary functions consistent with the permissible scope of our authority. Specifically, the Leased Premises was selected by us to be used as a secure juvenile -~ detention facility (the "Facility"). The secure juvenile detention facility program is a vital link in the statewide initiative to divert juvenile violators from state facilities and allow them to return to the local community as productive and law abiding citizens. Therefore, the Board has agreed that it shall make timely requests for funds from the State Legislature through the Texas Juvenile Probation Commission ("TJPC"), when and as consistent - with TJPC policies and procedures in effect from time to time and funds are available for such purposes, to enable the Lessee to make all payments under the Lease, or to pay Lessee's obligations under the Lease, or for direct payment of amounts pursuant to Interlocal Contract. _ Lessee further agrees that in the event such funds are appropriated by the Legislature and provided to Lessee by the TJPC, Lessee shall utilize such funds to maintain and satisfy its obligations pursuant to the Lease. The Board has further agreed that it shall place juvenile offenders from the County, who are _ placed and confined in the custody of the Board by court order, in the Facility and that it shall work to obtain Interlocal Contracts with other jurisdictions that have responsibility for juvenile offenders and access to funds from the State Legislature through the TJPC for the housing and _ placement of juveniles. The Board will seek Interlocal Contracts to enable the Lessee to make all payments under the Lease from TJPC funds appropriated directly to the Board therefor and/or to jurisdictions contracting to place juveniles in the Facility. The funds, if any, appropriated and _ received directly from TJPC for the purpose of paying Lessee's obligations under the Lease and funds available from Interlocal Contracts will be applied to the Lease obligations. The sources of funds for the payment of all the obligations of Lessee under the Lease will be the revenues actually received from the housing of juveniles that are in the custody and ~~ jurisdiction of the Board, pursuant to court order or Interlocal Contracts with other jurisdictions. The funding for the Board and other entities to house residents at the Facility derives from discretionary appropriations to the Board and other entities and from funds provided by the State ~~ Legislature through the TJPC. The TJPC has agreed that it will take the steps required to have funds appropriated by the State Legislature in each biennium and to actively pursue the requirements necessary for appropriations during the term of the Lease. The estimated useful life of the Leased Premises based upon our projected needs is in excess _ of twenty (20) years. Our source of funds for payments of the Rental Payments due under the Lease for the current fiscal year is appropriations from the State of Texas. We expect and anticipate adequate funds to be available for all future Rental Payments due after the current fiscal year. _ LESSEE: Kerr County Juvenile Board, as agent for Kerr County Texas. By: Name: William G. Stacy - Title: Chairman of the Board _ By: Name: Simon J. Harris Title: Chief Juvenile Probation Officer EXHIBIT "D" GENERAL WA,~tRAN'rY DEED THE STATE OF TEXAS _ COUNTY OF KERB KNOWN ALL MEN BY THESE PRESENTS: - THAT THE UNDERSIGNED, ,hereinafter referred to as "Grantor", for and in consideration of the sum of TEN DOLLARS ($10.00) cash, and other good and valuable consideration in hand paid by ReCor, Inc., hereinafter referred to as - "Grantee", the receipt and sufficiency of which is hereby fully acknowledged and confessed, has GRANTED, SOLD and CONVEYED, and by these presents does hereby GRANT, SELL and CONVEY UNTO ReCor, Inc., as "Grantee", all Grantor's right, title and interest in and to the - following described real property situated in Kerr County, Texas, to-wit: _ together with all improvements thereon, fixtures affixed thereto, and appurtenances thereto including all of Grantor's right, title and interest in and to all leases, if any, affecting the Land, _ and all rights, privileges, and easements appurtenant to the Land, which are owned by the Grantor, including without limitation, all mineral, oil, gas and other hydrocarbon substances on and under the Land, as well as all development rights, air rights, water, water rights, and water _ stock relating to the Land and any other easements, rights-of--way or appurtenances used in connection with the beneficial use and enjoyment of the Land including, without limitation, any and all rights of Grantor in and to all roads, alleys, easements, streets and ways adjacent to the - Land, and the rights of ingress and egress thereto from the public streets. This conveyance, however, is made and accepted subject to any and all validly existing - encumbrances, conditions and restrictions, relating to the hereinabove described property as reflected by the records of the County Clerk of Kerr County, Texas. TO HAVE AND TO HOLD the above described premises, together with all and singular the rights and appurtenances thereto in anywise belonging unto the said Grantee, Grantee's ~' successors and assigns forever; and Grantor does hereby bind Grantor's successors and assigns, to WARRANT AND FOREVER DEFEND all and singular the said premises unto the said Grantee, Grantee's successors and assigns, against every person whomsoever claiming or to claim the same or any part thereof. EXECUTED this day of 1994. [if corporation, partnership, etc. insert name here.] [signatures as appropriate] By: Name: Title: THE STATE OF TEXAS § _ § COUNTY OF KERR § The foregoing instrument was acknowledged before me on the _ day of January, 1994, by [complete as appropriate to the entity or individual]. NOTARY PUBLIC In And For the State of Texas My Commission Expires: GRANTEE'S ADDRESS: _ ReCor, Inc. _ Austin, Texas RETURN RECORDED DEED TO: ._ Bickerstaff, Heath & Smiley, L.L.P. 98 San Jacinto Blvd. , Suite 1800 Austin, Texas 78701-4039 ATTENTION: Barney L. Knight General Warranty Deed to ReCor, Inc. 2 L FIRST AMENDMENT TO AN ESCROW AGREEMENT RELATING TO ` THE KERB COUNTY JUVENILE FACILITY -' THIS FIRST AMENDMENT TO AN ESCROW AGREEMEN RELATING TO THE KERB COUNTY JUVENILE FACII,I1'Y, is made as of this the I~~ay of ~ , 1994 by and between The Chicago Corporation, a Delaware Corporation ("Escrow Agent"), eCor, _ Inc., a Texas corporation ("Lessor"), the Kerr County Juvenile Board, as agent for Kerr County, Texas ("Lessee") and ChiCorp Financial Services, Inc., a Delaware corporation _ ("CFSI"). The Escrow Agent, Lessor, Lessee and CFSI shall be jointly referred to herein as the "Parties" . RECITALS: WHEREAS, the Parties heretofore entered into an Escrow Agreement Relating to the _ Ken County Juvenile Facility (the "Escrow Agreement"), dated as of the 31st day of March 1994; _ WHEREAS, the Escrow Agreement provided certain conditions precedent for the release of funds and monies deposited into the Escrow Fund pursuant to the Escrow Agreement; - WHEREAS, Section 3.01(c) of the Escrow Agreement provided, in part, that the Escrow Agent would not release and pay certain funds until such time as CFSI notified Escrow Agent that it had received properly executed Interlocal Cooperation Agreements for 24 beds in the - Facility (including the beds to be used by Lessee); WHEREAS, through numerous contacts with other governmental entities the Lessee has -- determined an interest in placing juveniles in the Facility which should produce sufficient numbers of Resident Clients to satisfy Lessee's revenue requirements and governmental purposes; WHEREAS, Lessee has determined that, although such entities have expressed their intention to place juveniles in the Facility when completed, they will not contract for beds until ~' the Facility is substantially complete; and WHEREAS, the Parties agree that amendment of Section 3.01(c) of the Escrow _ Agreement to delete the requirement that Lessee obtain properly executed Interlocal Cooperation Agreements for 24 beds in the Facility prior to the release of funds from the Escrow Fund will facilitate implementation of the Parties intent; WHEREAS, Lessee, with the Assistance of the Operator, has obtained more than 24 _ "Statements of Interest" indicating other governmental entities' intention to use the facility; NOW, THEREFORE, for and in consideration of the premises and mutual covenants _ herein contained, the Parties hereby contract, covenant and agree as follows: Section One. Subsection (c) of Section 3.01 of the Escrow Agreement is hereby - amended to read as follows: _ (c) Thereafter, upon written notice from CFSI to Escrow Agent that CFSI is in receipt of: (i) sufficient Statements of Interest to house juveniles in the Facility having been received, in CFSI's judgement, to indicate a market base for the _ Facility; (ii) an executed Operation and Management Agreement between ReCor, Inc. and Lessee; and (ii) the Mortgagee Title Policy, Deed of Trust, required certificates, opinions and miscellaneous financing documents, all acceptable to _ CFSI, the Escrow Agent shall fund and disburse the costs and expenses for acquisition of the land as listed in a closing statement executed by each of the parties to the closing and approved by CFSI, and shall allocate the balance of the _ Acquisition Account as follows: (1) $211,785.00 to the Payment Account as capitalized interest for the payment of interest on the Facility during construction; (2) $83,896.47 to the Payment Account as the Rental Deposit; and (3) the balance -- of the Acquisition Fund to the Construction Account. Section Two. The Payment Request Form, attached to the Escrow Agreement as Exhibit - "B", is hereby amended in its entirety to read as provided in Exhibit "A" hereto, and, as so amended, is attached hereto and incorporated herein for all purposes as Exhibit "A". -- Section Three. Save and except for the amendments set forth above, each and every term, condition and provision of the Escrow Agreement shall remain in full force and effect. ` IN WITNESS WHEREOF, the parties have executed and attested this Amendment Number One to the Escrow Agreement by their officers thereunto duly authorized as of the date first above written. KERB COUNTY JUVENILE BOARD, THE CHICAGO CORPORATION, _ as Agent for Kerr~ounty, Texas as Escrow A/gent ~-~ Y~ _ Name: William G. Stacy Name: `/~ f6; - % f~~: Title: Chairman of the Board Title: ~ ~~.- ,~'.~' CffiCORP FINANCIAL SERVICES, INC. RECOR, C. _ By: By: Name: Ramona Regas ~ Name: Glen Heckman Title: Senior Vice President ~ ,Title: President ~~~~ .- '`~ ~_ 2 EXHIBIT A -- PAYMENT REQUEST FORM - TO: The Chicago Corporation (The "Escrow Agent") FROM: ChiCorp Financial Services, Inc. ("ChiCorp"); - SAE/Spa-Glass, Inc. ("Contractor/Builder"); ReCor, Inc. ("Lessor"); Harry Golemon & Assoc. ("Senior Architect"); and '- Ken County Juvenile Board ("Lessee") SUBJECT: Escrow Agreement dated as of March 31, 1994, (The "Escrow Agreement") and _ the Lease-Purchase Agreement, dated as of March 31, 1994, between ReCor, Inc., as Lessor, and the Kerr County Juvenile Board, Individually and as agent _ for Ken County, Texas, as Lessee, (the "Lease") for the Lease of a juvenile probation facility (the "Facility") _ This represents Requisition Certificate No. _ in the total amount of $ for payment of those Costs of the Facility detailed in the attached payment instructions. _ The undersigned Lessee, Lessor, Senior Architect and Contractor/Builder certify that: 1. All of the expenditures for which moneys are requested hereby represent proper _ Costs of the Facility, have not been included in a previous Requisition Certificate and the Contractor/Builder represents that such expenditures have been properly recorded in the Contractor/Builder's books. - 2. The moneys requested hereby are not greater than those necessary to meet obligations due and payable or to pay and reimburse the Contractor/Builder for - fees or funds actually earned or advanced for Costs of the Facility. The moneys requested do not include retention or other moneys not yet due or earned under construction contracts. 3. After payment of moneys hereby requested, there will remain available to the Contractor/Builder (from the Acquisition Fund) sufficient funds to complete the -' Facility substantially in accordance with the Plans. EXECUTED this day of , 199_. SAE/SPA-GLASS, INC. _ By: Name: Fred Raley Title: President By: _ Name: Title: Harry Golemon, Sr. AIA Partner/Principal -- EXHIBIT A -PAYMENT REQUEST FORM PAGE Z OF 2 - The undersigned Lessee and Lessor each agree that (i) the above statements are, to the best of its lrnowledge, true; (ii) the amount of this requisition constitutes a final or partiai acceptance of the Facility; and (iii) that id the final acceptance does not occur prior to - 199_, that the unspent construction funds will become the property of the Lessee and that rent will commence pursuant to Article 2 of the Lease Purchase Agreement. "' AGREED TO THIS day of AGREED TO THIS DAY OF 1994. , 1994 Kerr County Juvenile Board, ReCor, Inc., _ Lessee . Lessor By: _ By: Name: Name: William G. Stacy Title: Title: Kerr County Judge. _ ~ _ Approved for payment this the day - of , 1994. ChiCorp Financial Services, Inc. By: _ Name: Ramona Regas Title: Senior Vice President c~ EXHIBIT "C" ~- STATE OF TEXAS § COUNTY OF KERB § ESSENTIAL USE AND SOURCE OF FUNDS CERTIFICATE This Exhibit is attached and made a part of the Lease-Purchase Agreement dated as of March 31, 1994, between ReCor, Inc., as Lessor, and the Kerr County Juvenile Board, as agent for Kerr County, Texas (the "Board"), as Lessee. All capitalized terms used herein and not otherwise defined shall have the same meaning as used in the Lease. _ This confirms and affirms that the Leased Premises is essential to the function of the undersigned and to the service we provide our citizens. _ Further, we have an immediate need for, and expect to make immediate use of, substantially all of the Leased Premises which is not temporary or expected to diminish in the foreseeable _ future. The Leased Premises will be used by us only for the purpose of performing one or more of our governmental or proprietary functions consistent with the permissible scope of our authority. Specifically, the Leased Premises was selected by us to be used as a secure juvenile _ detention facility (the "Facility"). The secure juvenile detention facility program is a vital link in the statewide initiative to divert juvenile violators from state facilities and allow them to return to the local community as productive and law abiding citizens. _ Therefore, the Board has agreed that it shall make timely requests for funds from the State Legislature through the Texas Juvenile Probation Commission ("TJPC "), when and as consistent _ with TJPC policies and procedures in effect from time to time and funds are available for such purposes, to enable the Lessee to make all payments under the Lease, or to pay Lessee's obligations under the Lease, or for direct payment of amounts pursuant to Interlocal Contract. Lessee further agrees that in the event such funds are appropriated by the Legislature and provided to Lessee by the TJPC, Lessee shall utilize such funds to maintain and satisfy its obligations pursuant to the Lease. The Board has further agreed that it shall place juvenile offenders from the County, who aze placed and confined in the custody of the Board by court order, in the Facility and that it shall work to obtain Interlocal Contracts with other jurisdictions that have responsibility for juvenile offenders and access to funds from the State Legislature through the TJPC for the housing and placement of juveniles. The Board will seek Interlocal Contracts to enable the Lessee to make all payments under the Lease from TJPC funds appropriated directly to the Board therefor and/or to jurisdictions contracting to place juveniles in the Facility. The funds, if any, appropriated and received directly from TJPC for the purpose of paying Lessee's obligations under the Lease and funds available from Interlocal Contracts will be applied to the Lease obligations. The sources of funds for the payment of all the obligations of Lessee under the Lease will be the revenues actually received from the housing of juveniles that are in the custody and •- jurisdiction of the Board, pursuant to court order or Interlocal Contracts with other jurisdictions. The funding for the Board and other entities to house residents at the Facility derives from discretionary appropriations to the Board and other entities and from funds provided by the State ~- Legislature through the TJPC . v~~~. has ad th~ a~t it will take the steps required to have funds appropriated by the Sta a gis afore m eac iennium and to actively pursue the requirements necessary for appropriations during the term of the Lease. The estimated useful life of the Leased Premises based upon our projected needs is in excess of twenty (20) years. Our source of funds for payments of the Rental Payments due under the -" Lease for the current fiscal year is appropriations from the State of Texas. We expect and anticipate adequate funds to be available for all future Rental Payments due after the current fiscal year. LESSEE: By: Name: Title: By: Name: Title: Ken County Juvenile Board, as agent for Kerr County Texas. William G. Stacy Chairman of the Board I.~( Simon J. Harris Chief Juvenile Probation Officer ~;, OPERATION AND MANAGEMENT AGREEMENT for the KERR COUNTY JUVENILE FACILITY This OPERATION AND MANAGEMENT AGREEMENT for the KERB COUNTY JUVENILE FACII,ITY (the "Agreement") is made as of S 1 1994 by and between - RECOR, INC. (the "Contractor") and the JUVENILE BOA OF KERB COUNTY (the "Board"), an agency and instrumentality of Kerr County, Texas (the "County"),apolitical subdivision of the State of Texas, upon the terms, conditions and provisions herein set forth. WITNESSETH WHEREAS, the Board and the Contractor have made provision for the financing and construction of a secure juvenile probation and challenge facility in Kerrville, Kerr County, _ Texas, which facility shall be known as the Kerr County Juvenile Facility (the "Facility"); and, WHEREAS, the Board and the Contractor desire to enter into a contract under which _ the Contractor shall provide the management and supervision of the Facility and shall provide, or cause to be provided, the operation of the Facility in accordance with the laws of the State of Texas and the rules and procedures promulgated by the Texas Juvenile Probation Commission - (the "Commission"); and, WHEREAS, the Board shall, with respect to each duty, responsibility, obligation, right - and authority undertaken or to be undertaken pursuant to the terms, conditions and provisions of this Agreement, be and is acting as the agent of the County as authorized by the County; - NOW THEREFORE, in consideration of the mutual rights, duties, benefits and obligations herein exchanged, the parties hereto do covenant, agree and bind themselves as follows: ARTICLE ONE PURPOSES 1.01. The Contractor shall manage, supervise and operate the Facility for the Board and _ receive, supervise and care for each juvenile that is assigned to and enrolled in the Facility (the "Resident Client") by the Board pursuant to applicable law. The Board acting directly or through its officers, employees and designees, in its discretion, may assign Resident Clients to _ the Facility that are referred for placement by court order and that originate from: (a) within Kerr County; (b) a jurisdiction that enters into an interlocal contract with the Board to reserve space for the on-going placement of persons in the Facility; or (c) a jurisdiction that contracts with the Board on a limited basis to house one or more individuals in the Facility. 1.02. The Contractor shall manage and supervise the Facility to remain in compliance - with all local, state and federal health, fire and safety codes and shall document such compliance at the beginning of each fiscal year. Such documentation shall consist of certificates from the local health department, Fire Marshall and building inspector and copies thereof shall be -~ forwarded to the Commission, as required or requested. The Facility shall be managed, operated, maintained and utilized in conformance and compliance with applicable law, and the standards and regulations of the American Corrections Association (the "ACA"), the -- Commission, or the following, whichever are higher: (a) the design, amenities and physical condition of the Facility buildings shall meet: - (i) the applicable electrical, plumbing, sanitation, fire, building, zoning and other applicable code requirements of each governmental jurisdiction in which the Facility is located; and (ii) the existing applicable requirements and standards of - the Board, the Commission and the ACA; _ (b) the number of clients shall be limited and established programs shall be structured to assure the Facility size and operation shall meet the needs of the program and comfortably accommodate the number of clients served; (c) sleep space, lounge areas, room for group and individual counseling of Resident Clients and office space for use by Board representatives at the Facility shall not _ be reduced; (d) the number of square feet/occupant shall be in accordance with local building codes and Commission standards and shall be at least 60 square feet per occupant/bed in sleeping areas with hall space, bathrooms and built-in closets not included in the 60 square feet; (e) the number of toilets, wash basins, bathtubs, and/or showers shall meet all applicable standards, but no less than one toilet and one wash basin shall be - provided for every five (5) Resident Clients, and at least one temperature controlled shower or bath shall be provided for every ten (10) Resident Clients. Toilets shall have seats and be enclosed with partitions, and all bathroom facilities _ shall be maintained in operating condition. (f) adequate heating, air conditioning, ventilation, lighting, and acoustical systems _ shall be provided to ensure healthful and comfortable living and working conditions for Resident Clients and staff. These systems shall serve all rooms, _ including living areas/units, sleeping areas/units, bathrooms, dining rooms, activity rooms, and hallways. Lighting shall be suitable for the tasks to be performed. All housing areas must provide access to a drinking fountain. (g) a separate activity room shall be large enough to accommodate and provide seating for all Resident Clients for meetings and recreational activities, such as TV, radio, library and table games; at least one operational color TV shall be Operation and Management Agreement Page 2 ` Kerr County Juvenile Facility _ provided for every 25 Resident Clients; the weight room shall be separate to allow for non-interference of activities; provided, however, the activity room and - smaller rooms shall be allowed to accommodate fewer people as long as all Resident Clients have the equal opportunity to attend meetings or recreational activities; (h) an outside recreational area for activities such as basketball, volleyball, etc. shall be maintained; and (i) an emergency fire plan with written procedures for safe evacuation of Resident Clients and staff shall be established and maintained and each new Resident Client shall be briefed on evacuation procedures as a part of the standard intake and orientation briefing procedures which shall be developed and applied to each - Resident Client upon their initial arrival at the Facility (the "intake process"); the fire exit plans shall be posted incompliance with local fire codes and monthly fire drills, requiring the evacuation of each occupied building, shall be held and _ documented (including the time and date of the drill, the amount of time to evacuate each building, the number of Resident Clients evacuated and a description of any problem areas found during evacuation procedure); the _ documentation shall be signed by the employee conducting the drill and shall be available for inspection at the Facility during regular business hours; _ (j) all safety plans and procedures shall be in accordance with and meet all requirements of 37 T.A.C. §343.8, including all amendments or recodifications thereof; (k) living units/areas, sleeping units/areas, activity areas, common areas, kitchen areas and dining areas shall be in accordance with 37 T.A.C. §343.8, including - all amendments or recodifications thereof; (1) all classification, segregation, and separation requirements of the Commission - shall be followed; and (m) all supervision requirements of the Commission shall be followed 1.03. Notwithstanding anything herein to the contrary, the physical plant, programs, _ staffing, services and operation and management of the Facility shall be in accordance with the standards of the Commission applicable thereto, including the standards set forth in Chapter 343 of the Texas Administrative Code (§§343.1 - 343.18) and any amendments, additions or recodifications thereof. 1.04. The Contractor shall work cooperatively with the Board and the Commission and _ agrees the Board and Commission have the right to inspect the Facility prior to the placement Operation and Management Agreement Page 3 Kerr County Juvenile Facility _ of any Resident Client and there shall be no placements made until both the Contractor and the Facility are in compliance with all contract provisions, and all standards or regulations of the - Commission. ARTICLE TWO TERM - 2.01. This Agreement is effective on the date set forth in the initial paragraph of this Agreement. The original term of this Agreement shall be three (3) years and such term shall commence on the date the first Resident Client shall occupy the Facility (the "Commencement - Date") and shall end on the third anniversary date thereafter (the "Term"); provided that the Board may, at its sole option, terminate this Agreement without penalty, liability or cost on the second anniversary date hereof upon thirty (30) days written notice. 2.02 The Board and the Contractor may negotiate a new agreement at the end of the _ original term. In such event, the selection of the Contractor shall be at the sole discretion of the Board and the Contractor shall provide operation, management and supervision of the Facility pursuant to the terms and conditions of such negotiated successor operation and _ management agreement. 2.03. Except as provided in 2.01, the Board may unilaterally terminate this Agreement _ only for reason of the Contractor's failure to operate or cause the operation of the Facility in compliance with the terms of this Agreement, State law, the applicable rules and procedures of the Commission and the applicable standards of the ACA. However, prior to any such - termination, the Board shall give written notice to the Contractor setting forth in detail all matters of alleged non-compliance and giving Contractor thirty (30) days within which to correct the matters of noncompliance set forth in the notice; save and except, where a material (and not - a single incident) failure of the Contractor poses an immediate threat to the health, safety or welfare of the residents of the Facility or the condition or security of the Facility, only seventy- two (72) hours notice and opportunity to cure shall be required, subject to immediate action if -' the delay of 72 hours creates a further danger to the safety, health or welfare of the Resident Clients. - ARTICLE THREE FACILITY REVENUES. COSTS & PAYMENTS 3.01. The duties and obligations of the Board to the Contractor, pursuant to or arising _ from this Agreement, shall be and are subject to appropriations and the receipt by the Board of revenues from jurisdictions placing residents in the Facility; and the financial duties and obligations of the Board pursuant to this Agreement shall be and are hereby limited to the _ appropriations and revenues actually received by the Board for and with respect to the Facility. Operation and Management Agreement Page 4 Kerr County Juvenile Facility 3.02. The Contractor shall monthly prepare and submit to the Board or its designee, no later than the 5th day of each month, a Monthly Attendance and Enrollment Report and other -- reports required by the Board. 3.03. The Contractor shall participate in an annual program evaluation and annual fiscal audit of the facility including the maintenance and availability of accurate and up-to-date program, client and financial records for inspection. _ 3.04. During the term of this Agreement: (a) the Board shall pay the Contractor $83.00 per long-term Resident Client and _ $73.00 per short-term Resident Client per day for the operation and management services set forth herein; (b) notwithstanding the foregoing, the Board shall pay the Contractor the per diem long-term or short-term rate, whichever is applicable, less a discount of $10.00, _ for each Resident Client placed in the Facility by the Board from Kerr County, Texas, unless the Leaseholder's Rights Fee as set forth below is opted for by the Board, in which case the Board shall pay the rates set forth in (a) for its own _ Resident Clients; (c) the payments to the Contractor pursuant to this section shall be payable solely _ from "Net Facility Revenues" as that term is defined herein. There shall be no accrual of unpaid compensation from months in which the Net Facility Revenues are insufficient to pay the compensation to the Contractor in whole or in part, - however, uncollected Net Facility Revenues from a month billed will be paid and applied when collected in accordance with this Agreement. - (d) the payments to the Contractor pursuant to this section shall, with respect to Resident Clients placed in the Facility by other jurisdictions be subject to the actual receipt by the Board of the contract fees and revenues therefor from the jurisdiction for which the Resident Clients are being housed under contract. The term "day" means atwenty-four (24) hour period, or part thereof, beginning at twelve o'clock midnight (12:00 a.m.). _ 3.05. The Board reserves the right to withhold or require the return of funds upon substantial non-compliance with applicable regulations, standards, policies or this Agreement if the Contractor fails to remedy or cure the non-compliance within thirty (30) days of written _ notice from the Board thereof, unless the non-compliance poses an immediate threat to security or safety of Resident Clients, in which case only seventy-two (72) hours notice and opportunity to cure shall be required, subject to immediate action if the delay of 72 hours creates a further _ danger to the safety, health or welfare of the Resident Clients. Operation and Management Agreement Page 5 -' Kerr County Juvenile Facility - 3.06. The term "Facility Revenue" shall mean all monies actually received by the Board for the housing at the Facility of Resident Clients from other jurisdictions, and all monies - payable by the Board for its own Resident Clients housed at the Facility. 3.07. The term "Net Facility Revenues" means the amount of Facility Revenues - remaining after the payment of all Lease Payments and other payments due under that certain Lease Purchase Agreement by and between the Board and RECOR, INC., including payments for the insurance, tax, and maintenance obligations under the Lease Purchase Agreement, and - after replenishment of the Operating Fund under the terms of the Operating Fund Agreement unless such replenishment is not required by the Board. - 3.08. The Board shall have the option every 180 days (based on the Commencement Date) under this Agreement to opt to receive from the Contractor a Leaseholder's Rights fee of - $3.00 per each Resident Client from all jurisdiction, per day in lieu of the $10.00 per Resident Client, per day discount set forth in Section 3.04(b). This option may only be exercised if the total average population for the Facility in the preceding 30 days exceeded 24 Resident Clients. 3.09. Save and except for charges for additional services to be provided by the Contractor to any Resident Client pursuant to a separate written agreement between the _ Contractor and the jurisdiction placing Resident Clients in the Facility to which the Board has provided written consent, all revenues received by any party, including the Contractor, with respect to the Facility shall be the property of the Board as agent for the County. 3.10. The Facility Revenues received for each month billed shall be paid to the County Auditor as the agent of the Board. The Auditor shall place the Facility Revenues in a special - segregated account. When sufficient Facility Revenues for the month billed are in the account to pay the amounts due and payable for that month under the Lease-Purchase Agreement, such funds shall be paid over to the Escrow Agent as provided in the Escrow Agreement Relating to - the Ken County Juvenile Facility dated March 31, 1994. The Net Facility Revenues received on the account of Resident Clients housed during a month billed (the facility revenues remaining after payments due and payable for that month under the Lease-Purchase Agreement are made) -' shall be deposited by the Auditor in an account at a financial institution designated by the Contractor within a reasonable time (not to exceed 10 calendar days) after receipt. ARTICLE FOUR DUTIES OF CONTRACTOR 4.01 The Contractor shall manage and shall operate and provide, or cause the _ operation and provision under Contractor's supervision and primary responsibility: (a) the documentation of all agreements or contracts of the Board with other -.~. jurisdictions, as referenced in Sec. 1.01, to (i) assure the documentation Operation and Management Agreement Page 6 -' Kerr County Juvenile Facility reasonably necessary for each such contract is complete and (ii) that any such contract or agreement is not inconsistent with the terms of this Agreement, prior --. to the housing of any person in the Facility pursuant to a contract between the Board and another jurisdiction; ~- (b) all services, supplies, amenities, benefits and equipment necessary to (i) comply with the terms of this Agreement and all contracts with other jurisdictions for the housing of Resident Clients/juveniles, (ii) meet or exceed State law requirements, - the rules and procedures promulgated by the Commission and the applicable standards of the ACA, and (iii) comply with applicable court orders and the Operational Plan; (c) intake facilities and Resident Client accounting which may encompass bookkeeping, record keeping and billing, system of controls, identification systems and records, communication interface with law enforcement agencies, and such statistical records as may be required by law; _ (d) attendants to control ingress and egress, maintain the requisite level of internal security and to monitor the activities of the Resident Clients within the Facility; (e) food and beverage services shall be provided in accordance with all applicable standards, sanitation and health codes and individualized and special needs. All _ menus shall be planned and reviewed in advance by a registered dietitian or physician. Meals shall meet the dietary requirements of the United States Department of Agriculture school breakfast, lunch and dinner dietary allowances - unless some other standard is specified by the Commission. Menu or food service plans shall be prepared, and a schedule shall be followed whenever possible. Menu plans are kept for one year. The menus shall contain a variety - of foods and recognize special occasions and holidays. The quality of the food and beverage services provided will be periodically reviewed by the Board or its designee, and the Contractor will immediately correct any deficiencies or - concerns noted by the Board or its designee. Special diets shall be provided: (i) to a Resident Client upon the recommendation of a physician or -' dentist. (ii) to a Resident Client whose religious beliefs require it. Staff members shall supervise the Resident Clients during meals. Staff _ monitoring Resident Clients while they are eating need not eat, but if they do, the Staff must eat the same food served to the Resident Clients unless the staff member is on a special diet ordered by his physician or dentist or a special diet _ is required by his or her religious beliefs. Two hot meals and one other meal Operation and Management Agreement Page 7 "' Kerr County Juvenile Facility which need not be hot shall be provided at regular meal times during each 24 hour period. No more than 14 hours may elapse between the evening meal and _. breakfast, unless a snack is provided. Notwithstanding anything herein to the contrary, all food and beverage service shall be provided by the Contractor in accordance with the applicable standards of the Commission. (f) clothing shall be provided to Resident Clients at least in accordance with Commission Standards, including those set forth at 37 T.A.C. §343.12 or any - amendment or recodification thereof. The use of uniforms is discouraged but not absolutely prohibited. The Contractor shall assure that a schedule is followed that provides for a daily bath or shower for each Resident Client, and shall promote, w' encourage and provide instruction on proper hygiene, and provide all necessary hygienic supplies. (g) laundry service for all Resident Clients in accordance with ACA and Commission Standards, clean linens to each Resident Client at least once weekly and clean = bath and hand towels twice per week, all without any deposit or fee being charged; _ (h) procurement and purchasing; (i) recreational, vocational and counseling services; (j) bookkeeping and financial accounting; - (k) basic medical care (see Article V of this Agreement); (1) training of personnel employed at the Facility, including such security, -- professional, law enforcement and cultural sensitivity training and education as may be required from time to time by the Commission, applicable ACA standards, the Board, the terms of this Agreement, third party contracts or - agreements executed by the Board, and the terms of all insurance policies applying to the Facility; ` (m) all repair, upkeep, maintenance and cleaning without any additional fee or profit to the Contractor; (n) a risk management program, including periodic risk management reviews and assessments; _ (o) all personnel services, miscellaneous supplies and benefits necessary to operation of the Facility, or the care and control of Resident Clients, including toiletries and hygiene supplies; Operation and Management Agreement Page 8 "' Kerr County Juvenile Facility (p) payment of all utility charges and fees, and, the payment of all valid taxes and assessments [if any] against the Facility, and any lien charged upon the Facility ..W. or any part thereof as a result of actions or inactions of the Operator; (q) engineering and maintenance; (r) an inventory of the Facility furnishings at start up, with statement the furnishings are sufficient and appropriate for the number of projected Resident Clients, and thereafter keep, maintain and replace such furnishings at its expense; (s) proper bedding to each Resident Client, clothing storage space which -' accommodates both hanging and folded clothing, a locked storage space or drawer for personal articles; a key to the storage area for personal articles shall be provided to both the Resident Client and the facility director; and (t) the provision of all such other services or tangible things that are necessary to _ care for the Resident Clients housed at the Facility, including all services and tangible things required by Commission standards or directives. _ 4.02. Contractor shall prepare and furnish such reports and audits as may be required by either the Lease or this Agreement to be submitted to the Board or any other firm, person or entity with respect to the operation of the Facility or the Resident Clients therein and, in _ addition, such other reports as may be required by State or federal law, the State of Texas or any agency thereof, the United States or any agency thereof, or any state or political subdivision thereof contracting with the Board to place Resident Clients in the Facility. Contractor shall prepare all reports required by the Commission for the Facility. 4.03. Contractor shall obtain, and thereafter maintain, all the proper and required - local, state and federal permits, licenses and certification(s) (the "Certifications") necessary for the Facility to serve as a secure juvenile probation detention facility. The Contractor shall maintain such Certifications as required. If, after such Certifications have been obtained, the Contractor is required by State law, other applicable law, Court Order, the rules and procedures promulgated by the Commission or the applicable ACA standards, to perform additional work or services, or to modify the Facility, the Board and the Contractor shall consult and, if ` appropriate, subject to appropriations and/or revenues therefor, agree upon a temporary increase in the schedule of payments sufficient over a reasonable period of time to reimburse the Contractor for the cost of such operational modifications. 4.04. Subject to the terms, conditions and limitations hereof and all applicable _ regulations, the Contractor will properly supervise all Resident Clients that are assigned to the Facility and for whom there is space available within the design, statutory and regulatory limits. Operation and Management Agreement Page 9 Kerr County Juvenile Facility 4.05. Notwithstanding anything contained herein to the contrary, the Board shall have no liability for any employees, agents, subcontractors or assigns of the Contractor. The Contractor hereby agrees to indemnify and hold the Board, the County and their officials, officers, employees, agents and assigns harmless from all costs, claims, expenses, and liabilities whatsoever which may be incurred by or arising from any and all acts done or omitted to be done by Contractor, or the employees, agents, subcontractors and assigns of Contractor, in connection with services performed or to be performed under this Agreement. - 4.06. The interviewing, hiring, training, assignment, certification, control, management, compensation, promotion and termination of all members of the Facility's administration and staff shall be the responsibility and obligation of Contractor. The Contractor - shall furnish reports on such matters to the Board when so requested by the Board. The Contractor will use its best efforts to hire and train local personnel. Staffing shall conform with the following: (a) the qualifications, selection, training and staff development shall comply with _ Commission standards, and written job descriptions for all employee positions at the Facility shall be prepared and provided to the Board; _ (b) a sufficient number of trained and qualified employees shall be on duty, awake and fully dressed at all times to meet all contractual requirements and to monitor Facility control, security and Resident Client safety; (c) the Board shall be notified within 72 hours of any change in the position of Facility Director; (d) adequate staff with provision for supervision of male and female Resident Clients shall be maintained in accordance with all legal requirements, including Commission standards. 4.07. The Contractor shall use its best efforts to purchase goods and services within the County. 4.08. No later than ninety (90) calendar days after the end of each calendar year in which the Contractor obtains an audit of Contractor or the Facility, during the term of this Agreement, the Contractor shall deliver to the Board a copy of any such audit of the Contractor and/or the Facility. The Contractor shall provide an audit during the third year of this Agreement and such audit shall be prepared by an independent auditor in compliance with GAAP and shall cover all aspects of Facility revenues, expenditures and operations. Audits may further _ be undertaken by the Board and, if undertaken, shall be accomplished, treated and responded to consistent with the following requirements. Operation and Management Agreement Page 10 '- Kerr County Juvenile Facility (a) The Board or the Commission may, at their cost and expense, conduct a complete Facility audit during any calendar year or may conduct such audit annually and -~ for such purpose, the Board, the Commission, their agents and employees shall have the right to examine and audit all books and records of the Facility. - (b) The Contractor shall receive written notice of any deficiencies raised in any audit of the Facility and, if corrections are required, shall submit to the Board and to the Commission, within ten (10) days of receipt of notice, a plan of correction - indicating the action to be taken and the time frames for full compliance. The Board or Commission shall review the plan of correction and shall either concur with the plan or, specifically identify corrective actions to be taken and the time- -' frame for completion. All deficiencies shall be corrected within 30 days from the date of the notice. (c) A substantive failure by the Contractor to comply with contractual terms and conditions which result in a material breach of security or health and safety _ standards may result in the immediate cancellation of the contract. (d) The Contractor shall provide the Board, within 30 days of receipt, copies of audit _ reports on all audit reviews that are conducted by other agencies or organizations. 4.09. The Contractor hereby agrees and covenants that all duties and activities of _ Contractor set forth in this Agreement and this Article Four, whether performed directly by Contractor or by others under Contractor's management and supervision, shall be performed in accordance with all controlling agreements and contracts, State and other applicable law, rules - and regulations promulgated by the Commission and applicable standards promulgated by the ACA. The standards provided in this Agreement shall be the minimum standards and shall control when no higher applicable standard established by the ACA, the Board or the -- Commission shall govern. In the event of a conflict between any of such standards an applicable, higher standard of the ACA shall supersede the terms of this Agreement and a standard of the Commission shall supersede the ACA standards. 4.10. All duties, activities and reports of Contractor set forth in this Article Four shall be at Contractor's sole cost and expense except as provided by the Lease or this Agreement; the _ fees, charges and costs provided to be paid by the Board (if any) shall be paid from the Board's funds and accounted for by Contractor as a service to the Board, and no amounts shall be paid _ pursuant to this Article Three for such duties, activities and reports. 4.11. The Contractor is associated with the Board for the purposes and to the extent _ set forth in this Agreement for the performance of operation and management services for the Facility, and Contractor is and shall be an independent contractor and, subject to the terms of this Agreement, shall have the sole right to supervise, manage, operate, control, and direct the _ performance of the details incident to its duties under this Agreement. Nothing contained in this Operation and Management Agreement Page 11 Kerr County Juvenile Facility Agreement shall be deemed or construed to create a partnership or joint venture, to create the relationships of an employer-employee or principal-agent, or to otherwise create any liability for -- the Board whatsoever with respect to the indebtedness, liabilities, and obligations of the Contractor. The Contractor shall be solely responsible for (and the Board shall have no obligation with respect to) payment of all federal income, F.I.C.A., and other taxes owed or - claimed to be owed by the Contractor, arising out of this Agreement, and the Contractor shall indemnify and hold the Board harmless from and against, and shall defend the Board against, any and all losses, damages, claims, costs, penalties, liabilities, and expenses whatsoever arising -' or incurred because of, incident to, or otherwise with respect to any such taxes. 4.12. In the event the Board shall at anytime be desirous of contracting with a jurisdiction that does not reserve beds in the Facility for the housing of that jurisdiction's clients within the Facility, the Contractor will develop and submit to Board for its approval a standard _ form of contract to be offered to and to be executed by the Board with any such jurisdiction. The standard contract shall provide that the contract (a) is cancelable at the option of the Board in the event of a failure of the Contractor to perform its duties under this Agreement or in the _ event the Contractor terminates this Agreement in accordance with its terms, (b) requires that all payments be made by such contracting jurisdiction directly to the Board and accounted for pursuant to this Agreement and (c) that the contracting jurisdiction shall pay for each such client _ all medical treatment costs and expenses of such client that are in excess of basic medical services as defined in this Agreement. Each contract with any such jurisdiction must be specifically accepted and executed by the Board, may include such amendments or alterations to the standard form as the Board may specifically approve and, save and except as approved by both the Contractor and the Board, shall not include anything that is inconsistent with the terms and provisions of this Agreement or the Lease. 4.13. In the event the Board contracts with another jurisdiction for the housing of that jurisdiction's clients in the Facility, the Contractor shall provide billing services and is authorized and directed to bill the Board fvr the fees provided in Article Three, and each jurisdiction each calendar month, one calendar month in arrears, for the aggregate amount due pursuant to the agreement between the Board and such jurisdiction, and/or between the Board _ and Contractor pursuant to this Agreement. A copy of each billing to a contracting jurisdiction shall be forwarded simultaneously to the Board. The billings to other jurisdictions contracting with the Board shall be in the name of the Board and shall be payable to the Board. 4.14. The Contractor shall maintain the roof, foundation, all outside utilities and _ structural soundness of the building (excluding windows and doors) in good repair, except for reasonable wear and tear. Such maintenance includes the duty to repair and/or replace components of the building that may be damaged due to neglect or any structural defect; _ provided that it is recognized that in the first year of occupancy, all product defects and workmanship are covered under warranties, with a five (5) year limited warranty on air conditioning compressors. Operation and Management Agreement Page 12 Kerr County Juvenile Facility 4.15. The Contractor shall provide the services hereinafter set forth in this Section 4.15 at its own expense and risk. Contractor shall maintain all interior walls and ceilings of the - building and also all interior windows, window glass, doors, electrical fixtures, and plumbing fixtures in good repair and condition; painting all interior walls as required, furnishing and regularly replacing furnace filters consistent with heating/air conditioning systems manufacturer -- specifications. The Contractor's duties shall include all usual janitorial and maintenance service including sweeping and waxing of floors, vacuuming, trash collection and disposal, the cleaning of windows, dusting and the replacement of light bulbs or fluorescent tubes in the light fixtures ~"' will be the responsibility of the Contractor. Contractor shall maintain all grounds including but not limited to, mowing, trimming, watering of plants and lawn as to maintain a good cosmetic look to the grounds. All maintenance and upkeep required by the Board shall be made in _ accordance with the manufacturer's recommendations. During the original term hereof only, Contractor shall be obligated for all repairs to the heating/air conditioning system including _ replacement of any components not covered by any existing warranty. In the event Contractor fails to comply with any of the requirements of this Article Four, the Board shall have the right, but not the obligation, to cause repairs or corrections to be made and any reasonable cost _ therefore shall be payable as provided in this Article Four. Contractor shall repair any damage caused by its negligence or default hereunder, or the negligence of its invitees, employees or customers, and deliver the leased premises in good repair and condition, reasonable wear and _ tear excepted. The Contractor will periodically have the Facility fumigated and/or sprayed for insects and rodents as needed. - 4.16. The Contractor shall pay all lawfully levied taxes or assessments against the Facility, the real property on which it is located, or the personal property used in conjunction therewith. If the Contractor fails to pay such taxes or assessments the Board may, but is not - required to, pay the taxes or assessments and recover the same from the Contractor, including all attorney's fees and costs incurred in the collection of the same. 4.17. The Contractor shall provide all services and accommodations required by applicable law, standards or regulations for the operation of the Facility whether or not specifically set forth herein. ARTICLE FIVE MEDICAL CARE _ 5.01. Basic medical care will be made available by Contractor at Contractor's sole cost, and without charge or reimbursement pursuant to Article Three of this Agreement, to all Resident Clients housed at the Facility. For the purposes of this Agreement "basic medical _ care" shall be limited to any condition which can be "self-treated" by the Resident Clients or which may be treated by a lay technician acting under guidelines provided by a medical doctor, including first aid for emergencies. This shall include the dispensing of "over-the-counter" _ medications which have been approved for inventory by the Facility's medical consultant. _ Operation and Management Agreement Page 13 Kerr County Juvenile Facility 5.02. Consistent with its duties to provide basic medical care the Contractor shall establish a program which includes: (a) the training of all supervisory staff in emergency first aid procedures and cardiopulmonary resuscitation (CPR); (b) adopting written medical backup plans which are communicated to all employees and Resident Clients; (c) maintaining sufficient first aid supplies and equipment to adequately support the overall basic medical care requirements of the Resident Client population; (d) maintaining, replacing and replenishing medical first aid supplies and equipment - in accordance with prescribed standards recognized or approved by a licensed health authority or organization that has the expertise to evaluate, assess and determine the potential need for or condition of the required first aid supplies and equipment; (e) written policies that set forth required procedural guidelines to be followed in the _ administration and management of all Resident Client medication, including (i) policy guidelines governing the standards for storage, security, monitoring, dispensing and maintaining administrative control and accountability of medication; - (ii) administrative control and accountability procedures requiring a written record of the name of the Resident Client, date, time, name of medication and signature of the authorized and trained employee of the Contractor -- dispensing the medication; (iii) restrictions providing that medication shall only be administered and -' recorded by an employee authorized or trained to dispense medication and to record the dispensation of medication; _ (iv) requirements that all medication must be secured in a suitable locked container with control records audited by the Contractor on a monthly basis. (v) requirements that in the event a Resident Client is released from the Facility without his/her medication, the medication shall be disposed of in accordance with Board standards, which disposition shall be witnessed and then documented on the client's medical log sheet; Operation and Management Agreement Page 14 Kerr County Juvenile Facility (f) all written policies and training required by 37 T.A.C. §343.13 or any amendments or recodifications thereof; (g) written policies and procedures for the prompt notification of the Resident Client's next of kin in the case of serious illness, surgery, injury or death; and (h) requirements that a death in the Facility shall be immediately reported to the proper local authorities; (i) all services and procedures required to provide medical care to Resident Clients in accordance with applicable law. 5.03. The costs of hospitalization, prescription drugs, surgical and dental care (and related non-local transportation costs) for Resident Clients shall be the obligation of the jurisdiction from which the Resident Client was assigned to the Facility. Such costs incurred by Contractor shall be invoiced by Contractor directly to the obligated jurisdiction. Under no circumstance shall the Board or the County be responsible for medical costs incurred with regard to a Resident Client from another jurisdiction, and payment therefor shall be solely the obligation of the jurisdiction from which the Juvenile Resident was assigned. 5.04. State certification and licensing requirements shall apply to all health care _ personnel responsible for dispensing medical services to clients. 5.05. Except as directed by the Board or required by lawful authority, the Contractor shall not knowingly accept or admit into the Facility any Resident Client who represents a significant health, medical or safety risk to the employees or the Resident Clients of the Facility. - 5.06. The Contractor shall develop workplace guidelines which address HIV policies, confidentiality and employee/ client education programs in compliance with State law. The guidelines shall, at minimum, substantially incorporate the model workplace guidelines - developed by the Texas Department of Health or those, if any, of the Board and the Commission. The Contractor shall maintain written policies and guidelines which include: "`~ (a) confidentiality guidelines regarding AIDS and HIV medical information for employees and Resident Clients, with policies consistent with guidelines published _ by the Department of Health and with state and federal laws and regulations; and (b) educational programs regarding HIV/AIDS based on the model education program _ created by the Texas Department of Health, tailored to meet the needs of all employees and Resident Clients, including the use of Braille, or telecommunications devices for the deaf, and the needs of persons with physical _ or mental disabilities. Operation and Management Agreement Page 15 "- Kerr County Juvenile Facility 5.07. The Contractor shall provide the Board and/or the Commission with copies of the above-stated policies and programs at on or before the commencement of this Agreement and, in any event, the Contractor shall not be eligible for payment until verification of compliance with these provisions is provided by the Contractor. ARTICLE SIX COMPLIANCE WITH STANDARDS 6.01. The Contractor shall prepare and adopt, prior to admitting any Resident Client to the Facility, a Procedures Manual for the operation of the Facility so as to assure that the _ Facility is operated fully in accordance with State and other applicable law and regulations, rules and procedures promulgated by the Commission and applicable standards promulgated by the _ ACA. The Contractor shall, from time to time, make such modifications and corrections in the said Procedures Manual as are necessary to keep the Facility in compliance with such laws, rules, regulations and standards. The Contractor shall prepare all such manuals, guidelines and policies required by Commission regulations, including those required by Chapter 343 of the Texas Administrative Code and all amendments and recodifications thereof. _ 6.02. The Contractor shall require that all employees at the Facility are adequately trained and certified, as appropriate, to perform at standards required by State and other applicable law, the rules and procedures promulgated by the Commission and the applicable -. standards promulgated by the ACA. 6.03. Prior to receiving any Resident Client, Contractor shall develop and submit to Board for its approval a detailed plan illustrating how Contractor intends to facilitate evaluation and monitoring of operations to ensure compliance with this Agreement. The monitoring plan, as amended from time to time, shall be adhered to throughout the term of this Agreement and shall include requirements for: (a) reporting procedures; (b) frequency of reporting; (c) subject-matter to be reported; and (d) an administrative/management audit system providing periodic assessment of facility operations designed to reveal the degree of compliance with the all policies and procedures. _ 6.04. The internal administrative/management audit conducted by the Contractor shall exist apart from any external or continuing audit conducted by the Board or any other agency. Operation and Management Agreement Page 16 _ Kerr County Juvenile Facility _ 6.05. The Contractor shall maintain an in-house community service work project log and volunteer log which shall include dates, times, location, work performed and the Resident -- Clients -facility employees assigned to the project. All community service work projects shall have the prior approval of the Board. - 6.06. Notwithstanding any other term or provision of this Agreement, the minimum standards for the operation and management of the Facility shall be the higher of the applicable standards of the ACA, the standards, rules and procedures of the Commission or the terms of - this Agreement. Where such standards, rules and procedures conflict those of the Commission shall govern over all others and both the ACA standards and the Commission's standards shall govern over those established by this Agreement. ARTICLE SEVEN DUTIES OF THE BOARD 7.01. Provided that the rated and design capacity of the Facility shall not be exceeded, the Board covenants and agrees to transfer to the Facility all juveniles that are referred by the Courts and that: (a) reside within Kerr County and that the Board does not elect to place in a facility then operated by the Board and constructed prior to the date hereof; (b) are referred for placement in the Facility by a district, department, board or County that has by inter-local agreement contracted with the Board to participate and reserve space in the Facility; (c) the _. Board contracts with another jurisdiction to place and house in the Facility, or in any facility similar or equal to the Facility that is controlled by or is owned by the Board; or (d) comes under the control and/or jurisdiction of the Board by virtue of a contract with another - jurisdiction. 7.02. This Agreement shall not apply to, and the Board shall be solely responsible for, - the housing, care and control of any juvenile housed by the Board at another Facility not operated by the Contractor. -' 7.03. The Board shall cooperate with Contractor in all matters of law enforcement, security and communications and shall employ its reasonable influence and persuasion to obtain such cooperation from the law enforcement agencies within Kerr County. 7.04. The Board may reasonably cooperate and assist the Contractor in the future with - on-going training, at Contractor's expense, of Contractor employees, agents or subcontractors. Such training, if any, shall generally be accomplished by permitting a reasonable participation by Contractor employees in local training programs, in-house training or by presentations at the Facility. Any such training assistance by the Board shall be performed solely as a convenience to Contractor, and the Board shall not be liable for any duty of care or performance with respect to such training assistance. Contractor shall remain solely responsible for the training of its employees, agents and subcontractors. Operation and Management Agreement Page 17 '- Kerr County Juvenile Facility 7.05. The Board shall assist and cooperate with the Contractor in obtaining and providing information needed by Contractor in the screening of candidates for employment. 7.06. It is agreed that the first priority for bed space in the Facility is to assure space is available for such persons that reside within Kerr County and that are referred for placement - by courts. However, the Board and Contractor agree it shall be to their mutual benefit and interest that the Facility be utilized by a Resident Client population within the design limits of bed capacity. To this end, and throughout the Term of this Agreement, the Board and - Contractor agree to cooperate and work to manage and limit long-term vacancies by contracting with other jurisdictions for the housing of residents from such other jurisdictions. 7.07. It is understood and agreed that neither the Board or the County is obligated to pay any amounts due from it hereunder from any source other than Facility Revenues, and that Facility Revenues are the sole source of funding therefor. ARTICLE EIGHT RESIDENT CLIENT PROGRAMS, MONITORING & STAFFING _ 8.01. The Contractor shall provide housing, supervision, and programs for all Resident Clients including programs and treatment for substance (alcohol and/or drug) abuse, aggressive offenders, sexual abuse offenders, behavior modification, literacy education, job readiness, employment training and living skills. As provided hereinbefore, the Contractor shall provide all programs, treatments, education or training required by applicable law, including the standards and regulations of the Commission, as part of its services under this Agreement. 8.02. Programs shall include the following: - (a) Orientation- all Resident Clients entering the Facility shall complete an orientation that includes: - (i) intake with a counselor; (ii) psychological assessment as necessary; (iii) physical examination of medical problems; (iv) orientation to Facility rules and regulations; (v) urine screening upon intake and at random or as needed basis; and (vi) assignment to a primary counselor. Operation and Management Agreement Page 18 - Kerr County Juvenile Facility (b) Living Skills -topics shall include but not be limited to: (i) budgeting, banking and credit management; (ii) housing; (iii) information and education on AIDS; (iv) health and nutrition; and (v) relationships/interaction with family/peers. (c) Job Readiness/Employment Training -topics to include but not be limited to: (i) evaluation of job skills; (ii) appropriate attire for job search; (iii) assertiveness training; (iv) applications and resumes; (v) interviews, including role playing; (vi} telephone skills; (vii) expectations of an employer; and (viii) educational films on securing employment. (d) Substance Abuse -topics shall include but not be limited to: (i) disease concept of alcoholism and drug addiction; (ii) physical and psychological effects of alcoholism and drug abuse; (iii) the family disease of alcohol and drug abuse; (iv) relapse prevention; (v) recovery; Operation and Management Agreement Page 19 '- Kerr County Juvenile Facility (vi) history and information on Alcoholics Anonymous, Narcotics Anonymous and the 12 steps; (vii) Alcoholics Anonymous and Narcotics Anonymous groups. - (e) Educational Program -topics to include but not be limited to: (i) ESL for non-English speakers; (ii) literacy screening; - (iii) adult remedial education classes; and (iv) GED screening and classes. (f) Special Needs Counseling -group and individual for: (i) sex offenders; and _ (ii) aggressive offenders. (g) All .other programs required by applicable Commission standards or _ determinations. 8.03. The placement of all clients shall be at the discretion of the Courts and no - person shall become a Resident Client of the Facility except upon assignment by the Board, acting directly or through its officers, employees and designees. - 8.04. From and after the commencement date of this Agreement, the Contractor shall be required to accept any placement referral from the Board as designated by space. The failure of the Contractor to accept a referral may result in the discontinuance of placements in the - Facility. 8.05. Participation by Resident Clients in all programs shall be made available by the - Contractor at no cost to such Resident Clients; provided that grants and/or endowments are not considered as costs to the client; and provided further that intake fees and deposits shall be strictly prohibited. 8.06. A written individualized assessment shall be completed for each Resident Client for every level of service provided and such assessment shall: (a) identify objectives to be accomplished while the Resident Client is at the Facility; Operation and Management Agreement Page 20 "' Kerr County Juvenile Facility (b) be completed within 72 hours of the Resident Client's arrival at the facility; _ (c) be signed and dated by a Facility employee and the Resident Client; (d) photograph each Resident Client during intake and maintain the photograph in the - Resident Client's file; and (e) at intake, provide the Resident Client with a copy of the rules, disciplinary procedures and evacuation procedures. 8.07. In the event the Contractor determines it can no longer work with a particular -' Resident Client, the Contractor shall notify the Board in writing of this fact along with its recommended action; provided that no Resident Client shall be discharged without the prior _ knowledge and consent of the Board. If the Resident Client poses a threat to the Contractor's employees or others proper law enforcement authorities shall be notified immediately and the Resident Client shall be detained until proper action is taken in response to the violation. When the client poses a threat to any employee or other Resident Client notice may be immediately provided to the Board via telephone communication with a designated Board representative. All interlocal agreements shall provide for the immediate return of Resident Clients to the _ contracting jurisdiction upon a determination by the Contractor, with the consent of the Board, that the Resident Client should be removed from the Facility. The procedure set out above may be modified by the Operations Manual if the specific procedure is approved in writing by the _ Board. 8.08. Upon discharge of long-term clients, the Contractor shall formulate a recommended aftercare residential plan for each client and absent suitable family support, the Contractor shall develop a recommended independent living plan. Aftercare plans shall be updated every thirty (30) days or as changes occur. 8.09. Appropriate safeguards shall be established to enable the Contractor to closely monitor the whereabouts of each Resident Client, including a daily system and periodic - accounting for all Resident Clients assigned to the Facility and providing that such Resident Clients shall only be allowed to leave the facility to conduct court approved business. Documentation showing implementation of this system shall be kept by the Contractor. 8.10. The Contractor shall provide a designated area for family visitation which shall _ accommodate visitors and also provide shelter during inclement weather. Family visits shall be allowed on weekends and during hours specified by the Contractor, provided the client is satisfactorily participating in required programs. 8.11. The Contractor shall adopt "Disciplinary Procedures" including procedures for the processing of violations and setting the types of sanctions which may be imposed. Such _ procedures shall be reviewed by the Board and the Commission, and each Resident Client shall Operation and Management Agreement Page 21 "- Kerr County Juvenile Facility _ be notified of the disciplinary process and provided with a copy of the procedures at intake. The Board shall be provided with a report and the recommended sanction if a Resident Client _ commits a significant violation. 8.12. The Contractor shall be responsible for maintaining accurate and complete case - records, reports and statistics as necessary for the evaluation of the program. Safeguards sufficient to protect the confidentiality of Resident Client records and to minimize the possibility of theft, loss or destruction shall be maintained. Safeguards, rules, procedures and standards - shall be provided for Resident Client records that: (a) recognize that any and all records provided to the Facility or any Facility ^' employee by the Board are deemed confidential and privileged information pursuant to guidelines established by the Commission and the Board; _ (b) prevent records from being disclosed to the Resident Client or to any person other than authorized Board or court employees who have a need to access said information; (c) require all Resident Client's records to be locked in a file cabinet accessible only _ to the Contractor and Board employees; (d) require individual case files for each Resident Client to be maintained on a _ current basis and for a period of not less than three (3) years after discharge of the Resident Client; - (e) require all files to include: identification data; probation plans and conditions of probation; pertinent case history; intake forms and facility needs assessment; referrals for service to other agencies and follow-up information on referrals; - chronological entries on at least a weekly basis to include dates, times, length of time of all counseling sessions, group sessions, orientations and required activities with signed attendance sheets signed by both the client and a facility employee - and a synopsis of each activity; correspondence regarding the case; records of significant incidents; signed release of information forms; past employment; and records of adjustment to include disciplinary reports and statements of progress - and/or compliance; _ (f) provide medical records and psychological assessments shall be maintained in a file separate from other client records; and _ (g) require that records and information listed in subsection (e) above shall be maintained in Resident Client files regardless of the level of care and that files and photo copies shall be made available to the court upon request. Operation and Management Agreement Page 22 - Kerr County Juvenile Facility 8.13. The Contractor shall provide all such other or different programs, monitoring, administration, and staffing required by applicable law or regulation for the operation of the _ Facility, whether or not specifically set forth herein, including all requirements of Chapter 343, Texas Administrative Code, and amendments or recodifications thereto. ARTICLE NINE LIABILITY AND INDEIVINITY 9.01. The Board and Contractor agree to jointly and severally act to ensure that neither becomes responsible for any actions taken with regard to any Resident Client prior to the -' delivery of such Resident Client to the Contractor's employees, officers and agents at the Facility. To the extent possible and allowed by law, the Board and Contractor will insure that _ all Resident Client agreements and contracts with another jurisdiction provide that the contracting jurisdiction shall defend, indemnify and hold harmless the Board and Contractor for any claims, damages or losses arising or alleged to have arisen from acts or failures to act, including but not _ limited to claims of false arrest, false imprisonment, wrongful detention, violation of civil rights, and all other claims of a similar nature, occurring prior to the delivery of any Resident Client to the Facility, or occurring after the release of any Resident Client therefrom to the contracting _ jurisdiction or assigning agency. 9.02. Contractor agrees to and hereby does defend, hold harmless and indemnify the _ Board and its officers, directors, employees, agents, and representatives from and against any and all claims, damages, demands, losses, costs, assessments and expenses incurred or suffered by the Board or its officers, directors, employees, agents or representatives that arise out of or - result from any cause or claim or any negligent or wrongful act, or failure to act pursuant to the provisions of this Agreement by the Contractor or its officers, employees, agents or representatives, or its subcontractors or assigns, and including, specifically, claims made that - arise out of alleged simple negligence of the officers, directors, employees and agents of the Board while on the premises of the Facility. - 9.03. The Contractor agrees to and does hereby assume responsibility for the care, maintenance and repair of the real and personal property that is: (a) owned by the Contractor or the Board; (b) is located at the Facility and (c) is used by the Contractor in the operation or maintenance of the Facility. - 9.04. Notwithstanding the foregoing or any other term provision or condition of this Agreement, as to third parties and third party claims, nothing in this Agreement is intended to nor shall be interpreted to: (a) waive or deprive the Board or the Contractor of any legal _ defense; (b) give, grant or bestow any legal right, defense or benefit upon any third party; or (c) deprive the Board or the Contractor of the benefits of any legal defense, including sovereign and official immunity, or the benefits of any law limiting damages. Operation and Management Agreement Page 23 Kerr County Juvenile Facility ARTICLE TEN INSURANCE 10.01. Contractor shall obtain and maintain in force during the term of this Agreement - beginning not later than the Commencement Date, at its sole cost, risk and expense and without charge or reimbursement to the Board, a policy or policies of liability insurance by an insurers} acceptable to Board and in an aggregate amount of no less than One Million Dollars - ($1,000,000) in coverage for any single claim thereunder. Save and except as hereafter modified by the parties in writing, such insurance shall be in addition to the coverage maintained or required to be maintained by the Board and shall insure against all claims whatsoever against - Contractor or the Board, or their officers, employees, agents and representatives, in connection with the detention, care, security, housing and training of Resident Clients of the Facility, including but not limited to claims based on violations or alleged violations of civil rights arising from services performed by Contractor or its employees, agents, subcontractors or assigns pursuant to this Agreement. 10.02. During the Term of this Agreement or any extended Term hereof, the Contractor shall at, its sole cost and expense, obtain, keep and maintain in full force and effect, an _ insurance policy or policies providing worker's compensation insurance (or its approved and authorized equivalent) in amounts not less than the amounts required by State law. _ 10.03. Prior to the Commencement Date the Contractor shall assure the insurance required pursuant to this Section 10.04 is in full effect. The Contractor may secure such insurance, or additional insurance, through companies licensed to do business in the State of - Texas, and thereafter secure and maintain insurance coverages in effect, as follows: (a) a policy or polices of insurance insuring the Facility buildings and premises - against all casualty and hazard risks and other risks of direct physical loss; (b) a policy or policies insuring against the interruption of rental payments under any - and all circumstances, with the exception of Article 17.5 of the Lease; provided that all such polices shall be for the benefit of the Board, the Contractor and any assignees of the Lease and all such policies shall name both the Lessor (or its -' assignee) and the Board as beneficiaries of said insurance; (c) a policy insuring against claims and liability for personal injuries, death or - property damages, that arise or are in any manner occasioned by premise defects or the acts or negligence of the Contractor or others in the custody, operation or use of the Facility; Operation and Management Agreement Page 24 "" Kerr County Juvenile Facility (d) all Contractor's vehicles (including those owned, leased or hired), regardless of purpose, shall be covered by automobile liability insurance in such amounts as are - agreed from time to time by the Contractor and Board; and (e) all other policies of insurance required by the Lease Purchase Agreement between - RECOR, Inc. , as Lessor, and the Board regarding the Facility. 10.04. Save and except as specifically provided in this Article Ten, each and every -' policy of insurance required by this Article Ten shall name the Board as an additional insured and shall provide that such policy may not be canceled or modified except upon at least thirty (30) calendar days notice in writing to both the Contractor and the Board. 10.05. Contractor shall provide to the Board insurance certificates as proof of the _ insurance policies obtained in accordance with this Article Ten and if, thorough no fault of the Contractor, such insurance policies are canceled or endorsed in such way as to limit such insurance coverage, Contractor shall provide the Board written notice thereof immediately, and _ Contractor may obtain, as soon as possible and at its own cost, replacement insurance policies. 10.06. The Board shall, however, be responsible for providing worker's compensation _ coverage and liability insurance for its officers, agents and employees, and insurance [if any] for its personal property used or stored at the Facility. - 10.07. The Contractor's obligations hereunder are subject to the terms and conditions of Section 14.07 of this Agreement, except to the extent of general liability policies (including civil rights coverage) See 10.01 and 10.03(c) and (d)) required hereunder with regard to the - operation of the Facility by the Contractor. ARTICLE ELEVEN MONITORING BY THE BOARD -' 11.01. The Board shall regularly monitor the operation of the Facility, and, to this end, the Board's designated representative may conduct a thorough on-site inspection of the Facility at least once during each month throughout the term of this Agreement. Such monitoring by - Board shall not relieve the Contractor of any duties, standards of care or responsibility. The Board, Chief Juvenile Probation Officer and/or any Board designee shall be given full access to conduct, and will conduct, any other inspections required by law, including the annual certification process for the Facility provided by §51.12(c) of the Texas Family Code. Operation and Management Agreement Page 25 - Kerr County Juvenile Facility ARTICLE TWELVE _ MAINTENANCE, UPKEEP AND REPAIR 12.01. All maintenance, upkeep and repair costs for the Facility shall be paid, or caused - to be paid, by Contractor pursuant to subsection 4.01 of this Agreement to the extent of sufficient Facility Revenues collected. - 12.02. Contractor shall make no alteration, addition or improvement to the Facility unless the Board consents in writing to such alteration, addition or improvement. ARTICLE THIRTEEN ADDITIONAL PROVISIONS 13.01. Notwithstanding Contractor's obligation to perform, or cause to be performed, _ all duties and services set forth in this Agreement in consideration of the compensation to be paid hereunder to Contractor, the Board and Contractor recognize and agree that operation changes, and additional services desired by entities contracting for the placement of Resident _ Clients, may, at some future time, require that Contractor provide services not included in the terms of this Agreement. In such event, the Board and the Contractor shall negotiate and execute written terms, conditions and amendments hereto or supplementary agreements prior to _ any such services being provided or compensation earned. 13.02. To the extent, if any, specifically authorized by the Board and another - jurisdiction placing Resident Clients in the Facility, the Contractor may make a separate and independent agreement with any such jurisdiction, agency or organization for the education or training of any such resident so long as such jurisdiction, agency or organization has the legal - right, capacity and authority to enter into a contract with Contractor for the education or training of any such Resident Client. The reimbursement of costs for these additional services shall be payable directly to Contractor by the appropriate contracting jurisdiction. The Contractor shall °' provide the Board with copies of all such contracts or agreements which shall be separate and independent of and impose no responsibility on the Board. _ 13.03. The Contractor may not assign, transfer or contract with a third party for the provision of any portion of its duties or responsibilities hereunder except with the express written approval of the Board on terms and conditions accepted and approved by the Board. However, the Contractor may contract with third parties to provide to it goods or services to allow the Contractor to perform under this Agreement without prior Board consent. 13.04. Notwithstanding anything to the contrary contained herein, in the event that the Lease is in default or notice of default or termination has been given prior to the Board's _ exercise of its option to purchase the Facility pursuant to the Lease and, as a result thereof, the Operation and Management Agreement Page 26 "- Kerr County Juvenile Facility Board surrenders possession of the Facility to the Contractor or its assigns, this Agreement shall be immediately terminated and canceled, and the Board and Contractor shall have no future __ duties, obligations or liabilities to each other in connection with this Agreement or in connection with the termination and cancellation of this Agreement. - 13.05. The Contractor and the Board further agree that the Board's liability, pursuant to this Agreement, is limited to Facility Revenues actually received and available for distribution to the Contractor after payment of amounts due under the Lease (Article Three), and claims or - causes that are covered by an insurance policy naming the Board as an insured or additional insured. In no event shall the Board ever be liable, for any cause or claim, to Contractor or its suppliers, contractors and subcontractors or their successors or assigns for any assessment, - claim, damage, payment or amount, whether for direct, indirect, or consequential damages, lost profits or loss of business, except to the extent of such revenues, fees and insurance coverage. The Contractor shall provide notice of this limitation and paragraph in each third party contract entered into pursuant to Section 13.03 of this Agreement or otherwise, and all who deal with Contractor with regard hereto, or with regard to the Facility, shall do so with notice hereof. 13.06. In the event of the occurrence of any damage to or loss of the Facility that materially affects the continued operation of the Facility the Contractor shall immediately notify the Board of such loss or damage. (a) If the damage or loss to the Facility is equal to fifty percent (50%) or less of the _ total value of the Facility and insurance proceeds or other funds, are available, the Contractor shall immediately proceed to obtain the repair and reconstruction of the Facility in consultation with the Board only as to the plans and quality of - repair. The Board has no obligation to appropriate any funds for this purpose, except insurance proceeds received therefor. -- (b) In the event the damage or loss to the Facility exceeds fifty percent (50%) of the value of the Facility and the repairs, rebuilding and reconstruction can be completed within one hundred eighty (180) calendar days after the date of such damage, the Contractor shall commence such rebuilding and reconstruction of the Facility within sixty (60) days from the date of the damage. In such event, the Contractor shall fund the repairs and reconstruction from insurance proceeds or - monies appropriated to or approved by the Board [if any, and none being required] and reconstruct the Facility upon plans and specifications approved by - the Board or, absent such approval, based upon the original plans and specifications for the Facility. _ (c) In the event the damage or loss to the Facility exceeds fifty percent (50%) of the value of the Facility and the rebuilding and reconstruction cannot be completed within one hundred eighty (180) calendar days after the date of such damage, the Operation and Management Agreement Page 27 '~ Kerr County Juvenile Facility Board shall promptly decide whether or not to rebuild and reconstruct the Facility. In such event: (i) if the Board decides to rebuild the Facility, the rebuilding and reconstruction shall be funded from insurance proceeds or monies - appropriated or approved by the Board [if any, and none being required] and the Contractor shall commence such rebuilding and reconstruction within sixty (60) days from the date of the damage and based upon plans - and specifications approved by the Board or, absent such approval, based on the original plans and specifications for the Facility; (ii) if the Board decides not to rebuild this Facility, then, in that event, this Agreement shall terminate immediately upon such determination; or (iii) if the Board determines that rebuilding, repairing, or restoring the Facility is practicable and desirable, and proceeds to cause such rebuilding, repairing, or restoring, the Contractor and the Board may never-the-less jointly determine to terminate this Agreement and to execute a new agreement for the supervision of the reconstruction and the subsequent _ operation and management of the new Facility. 13.07. In the event title to or the temporary use of the Facility, or any part thereof, shall - be taken in condemnation or by the exercise of the power of eminent domain by any governmental entity or by any person acting under governmental authority, promptly after such condemnation or exercise of the power of eminent domain, the Board and Contractor shall - jointly determine whether to restore or replace the Facility. If the decision is to restore or replace the Facility, the Contractor shall forthwith proceed with such restoration or replacement, which restoration or replacement shall thereupon become part of the Facility. In such case, any - proceeds received from any award or awards in respect of the Facility or any part thereof made in such condemnation or eminent domain proceedings, after payment of all expenses incurred in the collection thereof, shall be for payment of, or reimbursement for, the costs of such "' restoration or replacement. If the Contra8, 19G l , 1963. 19(16, 1967, 1970, 197-1, 197'. 198' br The American Ins[itute of .architects, 1735 tiew York .1t _-~c. ~.~' , Washington. D C. ZO(N11~ violatrs the copyright lams of the l'nited Stares end will be sublrct to lcg~l prusecunon. AIA DOCUMENT 8141 OWNER-ARCHITECT ~.~~REE~tENT • FOURTEENTH EDITION •AIA" O19R? T}iE ANERICA\ INSTI"iUTE OF ARCNITECT~. ! ~~` ~EVC' PORK AVENUE. N Vt', ti'ASHINGTON. D C. ?IANI(i B~ 4~-~ 9S7 WARNING: Unlicensed photocopying violates U. S. copyright laws and is subject to legal prosecution. TERr~-IS AND CONDITIONS OF AGREEMENT SE1'WEEN OWNER AND ARCHITECT _ ARTICLE 1 ARCHITECT'S RESPONSIBILITIES -- 1.1 ARCHITECT'S SERVICES 1.1.1 The Architect's services consist of those sen•ices per- furmrd by the Architect, Architect's employees and Architect's - consultants as enumerated in Anicfes ?and 3 of this Agreement and ant other services included in anicle 12. 1.1.2 The Architect's services shall be performed as expedi- tiously as is consistent with professional skill and care and the orderl}• progress of the Work. Upon request of the Ott•ner, the Architect shall submit for the Owner s approval a schedule for the performance of the Architects sen•ices which may be adjusted as the Project proceeds, and shall include allowances for periods of time required for the On-ner's review and for approval of submissions by authorities having jurisdiction over the Project. Time limits established b~- this schedule approved b}' the Oa-ner shall not, except for rea~nable cause, be exceeded by the Architect or Owner. 1.1.3 The sen•ices covered by this Agreement are subject to the time limitations contained in Subparagraph 11.5.1. ARTICLE 2 SCOPE OF ARCHITECT'S BASIC SERVICES 2.1 DEFINITION 2.1.1 The Architect's Basic Services consist of those described in Paragraphs 2.2 through 2.6 and am- other services identified in Article 12 as pan of Basic Services, and include normal sttuc- tural, mechanical and electrical engineering services. 2.2 SCHEMATIC DESIGN PHASE 2.2.1 The Architect shall review the program famished bs the Oct•ner to ascertain the requirements of the Project and shall arrit•e at a mutual understanding of sucZ requirements n•ith the Owner. 2.2.2 The Architect shall provide a preliminary evaluation of the OR•ner's program, schedule ar.~ construction budget requirements, each in terms of the other. subject to the limita- bons set forth in Subparagraph 5.2.1. 2.2.3 The Architect shall re~•iew R•It.`- ~:e Owner alternative approaches to design and constructio- of the Project. 2.2.4 Based on the mutually agreed-::~~~n program, schedule and construction budget requiremer.:<. the Architec[ shall prepare. for approval b}• the Owner. ~~hematic Design Dcxu- ments consisting of dra~tiings and other ~~~cumcnts Illustrating the scale and relationship of Project a.:-:p~)nents. 2.2.5 The architect shall submit to ts:e OR-ner a preliminary- estimate of Construction Cost based ur: current area, volume or other unit costs. 2.3 DESIGN DEVELOPMENT PHASE 2.3.1 iiised on the •appnn•ed Scher.:~;:c Design Dr)cum~nts and an. adjuuments authorized by the • ,n nee in the ltrugram. schedule or construction budget, the Architect shall prep:uc. far appn7eal by the O>,•ner, Design Development Documents ctimsisting of drawings and other documents to fix and describe the size and character of the Project as to architectural, stn)r- tural, mechanical and electrical systems, materials and such other elements as may be appropriate. 2.3.2 The Architect shall advise the On•ner of any- adjustments to the preliminary estimate of Construction Cost. 2.4 CONSTRUCTION DOCUMENTS PHASE 2.4.1 Based on the appro~•ed Design Development Docu- ments and any further adjustments in the scope or quality of the Project or in the construction budget authorized by the Owner, the Architect shalt prepare, for approval by the Owner. Construction Documents consisting of Drawings and Specifica- tions setting forth in detail the requirements for the construc- tion of the Project. 2.4.2 The Architect shall assist the Owner in the preparation of the necessary bidding information, bidding forms, the Condi- tions of the Contract, and the form of Agreement between the Owner and Contractor. 2.4.3 The Architect shall ad~•ise the Oa•ner of an}' adjustments to previous preliminary estimates of Construction Cost indi- cated by changes in requirements or general market Conditions. 2.4.4 The Architect shall assist the On•ner in connection with the Owner's responsibility- for filing documents required for the approval of governmental authorities having jurisdiction over the Project. ~.. 2.5 BIDDING OR NEGOTIATION PHASE 2.5.1 The Architect, fotlon•ing the Owner's appro~-al of the Construction Documents and of the latest preliminan• estimate of Construction Cost, shall assist the Oa•ner in obtaining bids or negotiated proposals and assist in awarding and preparing contracts for construction. 2.6 CONSTRUCTION PHASE-ADMINISTRATION OF THE CONSTRUCTION CONTRACT 2.6.1 The .architect's respon:ibilin• to pro~•ide Basic Services for the Construction Phase under this Agreement commences ~~•ith the award of the Contract for Construction and termi- nates at the earlier of the issuance to the Owner of the final Certificate for Pavmrnt or 6U days after the date of Suhstan- tial Com}7letinn of the \\~~rk. 2.6.2 The architect shall provide administration of the Con- tract for Construction as set forth below and in the edition of AIA Document A2g1, Genera! Conditions of the Contract for Constructirn, current as of the date of this Agreement, unless otherwise provided in this Agreement. 2.6.3 Duties. responsibilities and limitations of authorin• of [hc architect ;halt nut fx: restricted. modified or extended without written agreement of the On-nrr and Architect with consent of the Contractor, which con:rnt shall not be unrcau)nahh ~~ ithheid. AIA DOCUMENT B1A1 • cwcYF.H~.;tir.tllTF~ ' :ŁE~ItNI' Fr)1 kTF.E\~TII EUI~r1r)ti • ,;IA' • i`>M- THE .iS1EkIr.AX I~~TITI 'r h: OF ARCHITF.r°1'~ '-6 ~~a' ~'~ )NK :~\'F.\I'E:. \ u . ~t tti1flVGl'I lti. U r. 4eHK~ 6141-1987 2 WARNING: Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. 2.6.4 'I-hc• :vi hltc•i t shall he .t rrprr~c•nt.tm c of and shall advi.c• anti iunsuit with thc• (7ivner f I I during icrnstntrtiun until final h:n au•nt to thc• C cxurartur is ~htc. an~i +'! :ts an Additional tier- t~ic'c• at thc• O~{-nrr . dirc•rtion fn,m time u r time during thc• ror- rriticrn hrriod c(c•sirihed in thc• (:Unlrait t~rr Cunstntction. "I'ht: architect steal{ h.tcc• authority n, act cm hehalC u( the (hvncr nnlc to thc• extent l.mrided in this Agrcrmrnt unless othenyiu nxxlificci h.' ct~rittc•n instrumem 2.6.5 'fhc• Arrhitcct shall ~•isit the stte at intervals appropriate u) the aa,~r of construction or as othcrn•ise agreed by Stec lh~•nrr :atd Arrhitrct in n•ri[ing to heiume gcnerall}• familiar tyith Stec progress and yuality c,f the \\~uck completed and to cirterminc in general if the \\ urk is bring prrformcd inr man- ner indicating that the \C'ork when completed will he in accur- ~tancr n•ith the Contract Documents Hc,~eycr, the Architect shall nut hr required to make exhaustive ur continuous on-site inspections a) check the qualin ur yuan[ity of the Work. On the basis of on-sire uhsen•ations as an architect, the Architect shall keep the O~~ner informed of the Progress and quality of the \1'ork. and shall endeavor to gua:.l the On•ner against defects and deficiencies in the \~-ork .[fore extensrr•e site rc~r-P+P)tturl0u »tal• (~e• agreett rr, lLc au -~rltlitiorra! Sert•ice, us descrilx~d i)r Parcrgrcrpl.) ;.?.1 2.6.6 The Architect shall not have control over or charge of and shall not be responsible for construction means, methods, techniques. sequences or procedures. or for safet}• precautions and program_c in connection R-ith the \\'ork. since these are solely the Contractors responsibilin- under the Contract for Construction. The Architect shall not he responsible for the Contractors schedules or failure ro earn' out the \XJork in accor- dance n•ith the Contract Documents. The Architect shall not haee control over or charge of acts or omissions of the Cornrac- ror. Subcontracrors. or their agents or employees, or of any ocher persons performing portions of the \C'ork. 2.6.7 The Architect shall at all times ha,~e access to the Work R-here{•er it is in preparation or progres>. 2.6.8 Except as may otherwise be pro~-ided in [he Contract Documents or when direct communications have been spe- cialh- authorized. the OR-ner and Contractor shall communicate through the .Architect. Communications ~~~ and R•ith the Archi- tecc's consultants shall be through the a:chitect. 2.6.9 Based on the architect's obseryar~ ^s and evaluations of the Contractors -~ppljcations for Pa~'me-:c. the ?trchitect shall reyien• and certill~ the amount- due the Contractor. 2.6.10 The Archirect s certification fv: ~ ~}~ment shall consti- tute a represemation to the On~ner. based on the architect's observations at the site as provided in St;'~p:tragraph 2.6.5 and on the data comprising the Contractor"> application for Pay- ntent, that. w [he best of the arhiter~= ~t:,~n~ledge. informa- tion and bzlief. Stec \\ork ha: pry ~,aresed :_ the point indicated and the qualin- of \\i~rk i< ir+. a;c~~rd::r.;e ~~ith the Contract Documents. The foregoing repre~entattons are subject to an evaluation of the \t"r,rk for conf~irmar.ce ~-ith the Contract Documents upon Substantial Compleuor.. to results of subse- quent tests and inspections. to minor de,-:atic~ns from the Con- tract Documents correctable prior to completion and to spe- ciiic qualifications expressed b.~ t~c arc:sect The issuance of a Certificate fur Pa.-ment Shall further cons:::utr a representation that the Cuntractur is entitled [~, , ayntcr.- :^ the amount certi- tir~1. Hocccycr. the issuance of a Crnitics:: f,,r Payment shall nc n hr a represrntauc rn that the architr:: `'.s~ ~. t 1 made exhaus- u,c nr cvntinur,u~ un~~rtc insPc~r,~ ut~ ' -.::ck the quality ur yurntin of the \Y~urk• (') rc•virt~rd construction mc:uts, ntcth- otls, trrhniyucs. scyuc•nres ur pnx-rclurcs, ({) reviewed topics of rcyuisitiuns rcccived (runt tiuhrontraca)rs and material sup- hlicrs tool other d:ua requested by the <)~~•rn•r w sulxtantiate the Cuntrle•u)r's ri};ht to pa~•mc•nt or (-t) asrc•rtained how or for .chat I,url>,>sc the Contractor has used munc•c previously paid un amount of the Contrtrt Swn. 2.6.11 The Architect shall hrye au[hurin• to reject V('urk which ck>cs nut conform to Stec Contract Dcx'umcnts. \>;'hcncvcr the Archite•rt considers it nrcrssrn• ur adyisahte for implementa- ti~n uC the intent of the Contract fhtcuments, the Architect will have authority to reyuirc additional inspection or testing of the Work in accordance with the provisions of the Contract Docu- ments, w-hrther or not such \\-urk is fabricated, installed or completed. Hon•ever, neither this :wthorit}• of the Architect nor a decision made in goad faith either to exercise or not to exer- cise such authority shall give rise to a duty or responsibility of the Architect to the Contractor. Subcantracutrs, material and equipment suppliers, their agents or employees or other per- sons performing ponians of the \t('ork. 2.6.12 The Architect shall review and approve or take other appropriate action upon Contractor's submittals such as Shop Dran-ings. Product Data and Samples. but onh• for the limited purpose of checking for conformance R•ith information given :tnd the design concept expressed in the Contract Documents. The Architect's action shall be taken with such reasonable promptness as to cause no delay in the \X'ork or in the con- struction of the Owner or of separate contractors. ~•hile allow- ing sufficient time in the Architect's professional judgment to permit adequate review. RevieR• of such submiuals is not con- ducted for the purpose of decemtining the accurac}' and com- pleteness of other details such as dimensions and quantities or for substantiating instructions fot installation or performance of equipment ors}•stems designed b}• [he Contractor, all of which remain the responsibility of the Contractor [o the extent required b}• the Contract Documents. The Architect's review shall not constitute approval of safet}• precautions or, unless othern-ise specificall}• stated b}- the Architect, of construction means. methods, techtques. sequences or procedures. The Architect's approval of a specific item shall not indicate approval of an assemb!}• of t<•hich the item is a component. \\'hen professional certification of performance characteristics of materials. s}•stems or equipment is required b{• the Contract Documents. the Architect shall be entitled to rely upon such certification to establish that the materials, s}'stems or equip- ment Rill meet the performance criteria required b}' the Con- tract Documents. 2.6.13 The Architect shall prepare Change Orders and Con- s[ruction Change Directives, n'ith supporting documentation and data if deemed necessan• b.' the architect as provided in Subparagraphs 3.1.1 and 3.3.i, for the Owner's approval and execution in accordance n•ith the Contract Documents, and ma}• authorize minor changes in the \~'ork not involving an adjustment in the Contract Sum or an extension of the Contract Time ~-hich are not inconsistent rich the intent of the Contract Documents. 2.6.14 The .Architect shall conduct inspections to determine the date or dates of Substantial Completion and Stec date of final completion. shall receive and fonyard to the On•ner for the n,+•ner's ret-ice.- anct records w-rittcn ~•arranties and related ducumen[s required h{• the Contract Documents and aiscm- hlrcl by the Contractor, and shall Issue a final Certificate for Pay- ment upon compliance ~•ith the requirements of [he Contract 1)ocuntents AIA DOCUMENT Bt{1 • !)~f'M1EK~.{KCHtTECT AGKEEMENT • FOURTEENTH EDITION • AlA• • ©1987 3 8~4~-987 -Hi A~11iRICAN1NtiTITI'TEOFAKCHITECTS, I'iSNF.VG'YORKA\'ENCE,NV:',WASHINGTON.D.C 2(x)06 WARNING: Unlicensed photocopying violates U. S. copyright laws and is subject to legal prosecution. • ~rrr> 2.6.15 The Architect shall interpret and decitk marten con- cernin~; performance of the O~cnrr and Contractor under the reyuirrtnents uC the Contract Documents on written rcyurst of either the Owner or Contractor The architect's reslx)nse to such requests shall he made with rra_:unable promptness and within any time limits agreed upon. 2.6.16 Interpretations and dreuion~ of the Architect shall be consistent ~•ith the intent of and reasonably inferable from the Contract Documents and shall be in ~•riting or in the fom~ of dran•ings. Vi'hen making such interpretations and initial deci- sions, the Architect shall endeavor to secure faithful perfor- mance by both Owner and Contractor. shall not show partiality to either, and ::hall not be liable for results of interpreca[ions or decisions so rendered in good faith. 2.6.17 The Architect's decisions on matters relating to aes[he- tic effect shall be final if consistent ~•ith the intent expressed in the Contract Documents. 2.6.18 The architect shall render n•ritten decisions within a reasonable time on all claims, dispute: or other matters in ques- tion betn•een the Owner and Contractor relating co the execu- tion or progrev of the Work as pro~~ided in the Contract Documents. 2.6.19 The Architect's decisions on claims, disputes or other matters, including those in question bet~•een the On•ner and Contractor, except for those relating to aesthetic effect as pro- vided in Subparagraph 2.6.1', shall tx subject to arbitration as provided in this Agreement and in the Contract Documents. ARTICLE 3 ADDITIONAL SERVICES 3.1 GENERAL 3.1.1 The sen•ices described in this Article 3 are not included in Basic Sen•ices unless so identified in article 12, and the}' shall be paid for b.- the Owner as pro~•ided in this Agreement, in addition to the compensation for Basic Services. The sen•ices described under Paragraphs 3? and ^.f stall onk be provided if authorized or confirmed in n-riting b}• the Oa•ner. If sen•ices described under Contingent additional Services in Paragraph 3.3 are required due to circumstance; be~•ond the architect's control. the architect shall notifi- tae Owner prior to com- mencing such services. If the Owner deems that such sen•ices described under Paragraph 3.3 are :vt required. the On•ner shall gi~•e promp[ written notice to tk:r architect. If the OR•ner indicates in R-riting that all or part ~ ~.° such Contingent addi- tional Sen-ices are not required. the arC.`.1irCt shall hac~e no obli- gation to pro.•ide those sen•ices 3.2 PROJECT REPRESENTATION BEYOND BASIC SERVICES 3.2.1 If more extensit•r representat:~ •n at the site than is described in Subparagraph ? (i.i is rec.:::;.i. the architect shall pro~•ide one or more Project Represe^ta:i~•rs to a_sist in cam•- ing out such additional on-site resp„^~thilities. 3.2.2 Project Rcpresrntati~-rs shall be ~elrctrd, rmplo}~ed and directed h~• the architect. and tht .~:;.^.:Ir~t shall hr compcn- sated therefor a~ agreed he the Can`.:: and Archttect. The doors. respumihilttirs ant! limitatiu, . .: .urthorit~- of Project Krpresenta[i~•e~ shall he as dcscrihr~ ::~ the edition of ala lh)cuntent fi~i! current as ut the dal. •r ;i~t~ agrrrnu•nt. unless othcrn isr agreed 3.2.3 'through the ohsen•atie)ns by sorb Pn)ject Itrpresrn- rttivrs, the Architect shall endeavor to provide further proter [ion fi)r the Owner againa defects and drticicncirs in the ~~'ork. but the furnishing of such prujrc't repr(:.untatiun shall ncx motiif}• the rights, respunsihilitirs or ohtig;uiuns of the Architect a.. described elsewhere in this agreement. 3.3 CONTINGENT ADDITIONAL SERVICES 3.3.1 Making revision, in Drawings, Specifications ur other documents when such revisions are: .1 incoltsistent n•ith approvals or instruc[ions pre~-ioush given b}• the On•ner, including revisions made nece~- san• by adjustments in the Owner's progrtnt ur Prui- ect budget; .2 required by the enactment or revision of codes, laws or regulations subsequent to the preparation of such documents; or .3 due to changes required as a result of the Ow-ner's fail- ure to render decision. in a timely manner. 3.3.2 Providing sen•ices required because of significant changes in the Project including, but not limited to, size, qual- ity, complexit}•, the On•ner's schedule, or the method of bid- ding ornegotiating and contracting for construction, except for services required under Subparagraph 5.2.5. 3.3.3 Preparing Drat~•ings, Specifications and ocher documen- tation and supporting data, evaluating Contractor's proposals. and providing other sen•ices in connection with Change Orders and Construction Change Directit•es. 3.3.4 Providing services in connection n•ith evaluating substi- tutions proposed by the Contractor and making subsequent revisions to Drawings, Specifications and other documentation resulting therefrom. ~- 3.3.5 Providing consultation concerning replacement of \Y'ork damaged b}' fire or other cause during construction, and fur- nishing services required in connection with the replacement of such Work. 3.3.6 Providing sen•ices made necessan• by the default of the Contractor, by major defects or deficiencies in the ~Y'ork of the Contractor, or by failure of performance of either the Owner or Contractor under the Contract for Construction. 3.3.7 Providing services in eti•aluating an extensit•e number of claims submitted by the Contractor or others in connection ~•ith the Fork. 3.3.8 Pro~-iding services in connection R-ith a public hearing. arbitration proceeding or legal proceeding except where the architect is pam• thereto. 3.3.9 Preparing documents for alternate, separate or sequential bids or providing sen•ice5 in connection a-ith bidding. neRutia- tinn or construction prior to the completion of the Construc- tion Documents Phase. 3.4 OPTIONAL ADDITIONAL SERVICES 3.4.1 Providing anal}~ses of the t~ei nrr'S needs and pn,Kr;un- ming the rcyuirements r,t the PruJc•( 3.4.2 Nn,~•iding fin:uteial tea1F.VT • FOl'RTEE^tTH EDITION •AIA' I')N- TIIFa~IEkIr:ANI\~TIT('TF.UF.~tt(.HITF.~:T~ :''°VE~%•YQRKA~'EVCE.NVt'.~%•ASHINC,l"C)\.U(. _'(MKN. 8141-1987 4 WARNING: Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. 3.4.4 Providing special sun•rys, cnyuunmcntal audits and suhmicsiuns required for approvals of l;uvemmental authorities or other: h:n•ing jurisdiction over tht• Project. 3.4.5 Pnwiding sen•ices relative to future lacilitics, systems and equipment. 3.4.6 Pn)yiding scn•ices [o im•cstiyatt• existing conditions or facilities ur to make mrisured drawings thereof. 3.4.7 Providing sc:n•icrs w verif}~ the accurrc}• of drawings or other infi)mtation furnished b}' the Owner. 3.4.8 Providing coordination of construction performed by separate contractors or by the Owner'' vn-n forces and coordi- nation of sen•ices required in connection with construction performed and equipment supplied b}~ the Owner. 3.4.9 Providing services in connection with the work of a con- struction manager or separate consultants retained b}• the Owner. 3.4.10 Providing detailed estimates of Construction Cost. 3.4.11 Providing detailed quantin• sun~eys or im•entories of material. equipment and labor. 3.4.12 Providing analyses of on•ning and operating costs. 3.4.13 Providing interior design and other similar services required for or in connection n•ith the selection, procurement or installation of furniture, furnishings and related equipment. 3.4.14 Providing sen•ices for planning Tenant or rental spaces. 3.4.15 :itakirtg investigations, incrntori~ of materials or equip- mrnt. or valuations and detailed appraisal of existing facilities. 3.4.16 Preparing a set of reproducible record drawings show- ing significant changes in the work made during construction based on marked-up prints, drawings and other data famished by the Conaactor to the Architect. 3.4.17 Providing assistance in the utilization of equipment or systems such as testing, adjusting and ba]ancing, preparation of operation and maintenance manuals. training personnel for operation and maintenance, and consultation during operation. 3.4.18 Providing sen•icec after issuance to the Oa•ner of the final Certificate for Pa}•ment, or in [he absence of a final Cer- tificate for Payment, more than 60 days after the date of Sub- stantial Completion of the Vi•ork. 3.4.19 Providing services of consultant> for other than archi- tectural. structural, mechanical and elecncal engineering por- tions of the Project provided as a pan ~~; Basic Services. 3.4.20 Providing an}• other sen-ices not ~~thena-ise included in this Agreement or not customarih• fur:•~ished in accordance n ith generall.~ accepted architectural practice. ARTICLE 4 OWNER'S RESPONSIBILITIES 4.1 The On per shall provide full in:c,rmation regarding requirements fur the Project. including a program which shal{ set forth the ~)cyner•s objectives. schedule constraints and cri- teria, indudin;~ space rcyuiremcnts and relationships, flexi- bilit}~. expandability, special ryuipmrn;. wstems and site requirements 4.2 the Uwncr shell establish anti upd.ur :ut uccr.tll hutif;t•t fur the Project, inclutlinl; thc• Constnit•tiun Cost, the (t~yncr's tuber costs and reasonable contingrncics «•Lut•d to all of these- costs. 4.3 If requested b}• the Architect, the (hyper shalt furnish rvi- drnct• that financialrrranpc•nicnts hayt• Ixt•n math to fulfill the On•ner s obligations under this Agrecnu•nt. 4.4 Thr Owner shall designate a rcprt:centrtivr authoriztd to act on the Oa•ncr's behalf frith respt•ct to the Project. The Owner ar such authorized « presentative .hall renttrr dreifENT • FOURTEENTH EDITION • AIAe • ©1987 THE AMERICAN INSTITUTE OF ARCHITECTS, t'3i ~E~1C YORK AVENUE, N.W., WASHINGTON, D.C. 2trUUG 8141-1987 6 WARNING: Unlicensed photocopying violates U.S. copyright laws and is subject to legal prosecution. _ ~ •~cept by writtrn consent containing a specific reference t this [cement signed by the Owner, Architect, and any cr person rneit}• sought to be joined. Consent tom Itnuon irnoh•ing dditional person or entin• shall pot constitute consent to arbit n of an}' claim, dicpute other matter in question not describe the written c rat or with a person or entity not named or d 'bed t ein. The foregoing agree- ment to arbitrate and other cements to arbitrate with an additional person or emit my co tcd to by the parties to this Agreement shall specifically rn cable in accordance with applicable 1 in any tour[ having ju 'coon thereof. 7.4 The rd rendered by the arbitrator or arbitra shall be final d judgment may be entered upon it in accordan with icable law in any court having jurisdiction thereof. ARTICLE 8 .3~F TERMINATION, SUSPENSION OR ABANDONMENT 8.1 This Agreement may be terminated by either party upon not less than seven days' written notice should the other party fail substantially co perform in accordance with the terms of this Agreemrnt through no fault of the parry initiating the termination. 8.2 If the Project is suspended by the OnTter for more than 30 consecutive days, the Architect shall be :ompensated for ser- vices performed prior to notice of such suspension. When the Projec[ is resumed, the Architect's compensation shall be equi- tably adjusted to provide for expenses incurred in the intetTUp- tion and resumption of the Architect's sen•ices. 8.3 This Agreement may bt terminated by the Owner upon not less than seven days' writtrn notice to the Architect in the event that the Project is permartrntiy abandoned. If the Project is abandoned by the Owner for more than 90 consecutive days, the Architect may terminate this Agreemrnt by giving written notice. 8.4 Failure of the Ownu to make pa}•mrnts to the Architect in accordance with this Agreemrnt shall be considered substantial nonperfomtance and cause for termination. 8.5 If the Owner fails to make payment when due the Archi- tect for services and expenses, the Architect may, upon seven days' written notice to the Owner, suspend performance of ser- vices under this Agreement. Unless payment in full is received by the Architect within seven days of the date of the notice, the suspension shall take effect without further notice. In the even[ of a suspension of services, the Architect shall have no liability to the Owner for delay or damage caused the Owner because of such suspension of services. 8.6 In the event of termination not the fault of the Architect, the Architect shall be compensated for sences performed prior to termination, together with Reimbursable Expenses then due . and al! Termination Expenses as defined in Paragraph 8.7. 8.7 Termination Expenses are in addition to compensation for Basic and Additional Services, and include expenses which arc directl}• attributable to termination. Termination Expenses shall _ be computed as a percentage of the total compensation for Basic Services and Additional Services earned to the time of ter- mination, as fotloa•s: .1 Twenty percent of the total compensation for Basic - and Additional Sen•ices earned to date if termination occurs before or during the predesign, site anal}•sis, or Schematic Design Phases: or .2 Trn percent of the total compensation for Buie and Additional Services earned to date if terminuion Decors during the Design Development Phase; or .3 Five percent of the total compensation for Basic and Additional Services earned to date if termination occurs during any subsequent phase. ARTICLE 9 MISCELLANEOUS PROVISIONS 9.1 UNess otherwise provided, this Agreement shall be gov- erned by the law of the principal place of business of the Architect. 9.2 Terms in this Agreement shall have the same meaning as those in AIA Document A201, Grneral Conditions of the Con- tract for Construction, current as of the date of this Agreemrnt. 9.3 Causes of action between the parries to this Agreement pertaining to acts or failures to act shall be deemed to have accrued and the applicable statutes of fimitadons shall com- mence to run not later than either the date of Substantial Com- pletion for acts or failures to act occumng prior to Substantial Completion, or the date of issuance of the final Certificate for Payment for acts or failures to act Decocting after Substantial Completion. 9.4 The Owner and Architect waive all rights against each other and against the contractors, consultants, agents and employees of the other for damages, but oN}• to the extent cov- ered by property insurance during construction, except such rights as they may have to the proceeds of such insurance as set forth in the edition of AIA Documrnt A201, General Conditions of the Contract for Construction, current as of the date of this Agrcemrnt. The Owner and Architect each shall require similar R•aivers from their contractors, consultants and agents. ~-• 9.5 The Owner and Architect, respectivel}•, bind themselves, their partners, successors, assigns and legal representatives to the other parry to this Agreement and to the partners, succes- sors, assigns and legal representatives of such other party with respect to all covenants of this Agreement. Neither Owner nor Architect shall assign this Agreement without the written con- srnt of the ocher. 9.6 This Agrcesnrnt represents the entire and integrated agree- ment betwern the Owner and Architect and supersedes all prior negotiations, representations or agreements, either writ- ten or oral. This Agreement may be amended only by written instrtrrrtrnt signed by both Owner and Architect. 9.7 Nothing contained in this Agreement shall create a contrac- tual relationship with or a cause of action in favor of a third party against either the Owner or Architect. 9.8 Unless otherwise provided in this Agreement, the Architect and Architect's consultants shall have no responsibility for the discovery, presence, handling, removal or disposal of or expo- sure of persons to hazardous materials in any form at the Project site, including but not limited to asbestos, asbestos products, pohdtbtinated biphrn}•! (PCB} or other toxic substances. 9.9 The Architect shall have the right to include representa- tions of the design of the Project, including photographs of the exterior and interior, among the Architect's promotional and professional materials. The Architect's materials shall not include the Owner's confidential or proprietary information if the Owner has previousl}' advised the Architect in writing of AIA DOCUktENT 8141 •OWNER-ARCHITECT AGREEMENT • FOURTEENTH EDITION • AlA• • ©1987 8141-19$7 THE AMERICAN INSTITUTE OF ARCHITECTS, t 735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 2000(1 WARNING: Unlicensed photocopying violates U.S. eopyrrght laws and is subieet to legal prosecution. the specific intirrntation c(xtsiderrd b.' the O~~•ner to be confi- dential or pn)prirtan•. The Un•ner shall provide professional credit for the Architect On the amstru~tiun sign and in the pro- motional materials f(Ir the Project. ARTICLE 10 PAYMENTS TO THE ARCHITECT 10.1 DIRECT PERSONNEL EXPENSE 10.1.1 Direct Personnel Expense is drfinrd as the direct salaries of the Architect's personnel enraged on the Project and the portion of the cost of their mandatory and customary con- tributions and benefits related thereto. such as employment taees and other statuton• emplo}•ee benefits, insurance, sick leave, holidays, vacations, pensions an~i similar contributions and benefits. 10.2 REIMBURSABLE EXPENSES 10.2.1 Reimbursable Expenses are in addition to compensa- tion for Basic and Additional Sen•icr_' and include expenses incurred b}• the Architect and Architects employees and con- sultants in the interest of the Project, as identified in the folloR•- ing Clauses. 10.2.1.1 Expense of transportation in connection with [he Project; expenses in connection with authorized out-of--town travel; long-distance communications: and fees paid for secur- ing approval of authorities having jurisdiction over the Project. 10.2.1.2 Expense of reproductions. Fvstage and handling of Dran•ings, Specifications and other documents. - -10.2.1.3 If atithorizt:d in advance by the OR•ner, expense of ovenime n•ork requiring higher than regular rates. --:C~r', 10.2.1.4 Expense of renderings, models and mock-ups requested by the Owner. 10.2.1.5 Expense of additional insurace coverage or limits, including professional liability insurar~e. requested by the On•ner in excess o€ that normally carne.: by the Architect and Architect's consultants. _ .: -, 10.3 PAYMENTS ON ACCOUNT OF BASIC SERVICES . - l )twt. 10.3.2 Subsequent payments for Basic Services shall be made monthly and, where applicable, shalt be in proportion to ser- vices performed within each phase of sen•ice, on the basis sec forth in Subparagraph 11.2.2. 10.3.3 If and to the extent that the time initially established in Subparagraph 1 ] .5.1 of this Agrremrnt is exceeded or extrndrd through no fault of the Architect, compensation for any ser- vices rendered during the additional period of time shall be computed in the manner set forth in Subparagraph 1 1.3.2. 10.3.4 When compensation is based on a percentage of Con- struction Cost and any ponions of the Project are deleted or otherwise not constructed, compensation for those portions of the Project shall be pa}•able to the extent sen•ices are per- formed on [hose portions, in accordance with the schedule sec forth in Subparagraph 11.2.2, based on (1) the lowest bona fide bid or negotiated proposal, or (2) if no such bid or proposal is received, the most recent preliminary estimate of Construction Cost or detailed estimate of Construction Cost for such por- lions of the Project. 10.4 PAYMENTS ON ACCOUNT OF ADDITIONAL SERVICES 10.4.1 Pa}~ments on account of the Architects additional Sen•ices and for Reimbursable Expenses shall be made monthly upon presentation of the Architect's statement of services ren- dered or expenses incurred. 10.5 PAYMENTS WITHHELD 10:5:1 No deductions shall be made from the Architect's com- pensation on account of penalty, liquidated damages or other stuns withheld from payments to contractors, of on account of the cost of changes in the V('ork other than those for which the Architect has been found to be liable. ' 10.6 ARCHITECT'S ACCOUNTING RECORDS 10.6.1 Records of Reimbursable Expenses and expenses per- taining to Additional Sen•ices and services performed on the basis of a multiple of Direct Personnel Expense shall be avail- able to the Owner or the Oarner's authorized representative at mutually convenient times. _ ARTICLE 11 BASIS OF COMPENSATION The Oa•ner shall compensate the Architect as follows: REFER TO ARTICLE 12.3. 1~-h.'~Hi~14~-P7~Y,ifŁ?i~'o` 86" to ) ~t. 11.2 BASIC COMPENSATION 11.2.1 FOR BASIC SERVICES. as descr~+ed in Article 2, and any other sen•ices included in Article 13 as part of Basic Sen•ices. Basic Compensation shall be computed as foL'on-s: /peserf brtsrs r j cr~mpensarron, nrcludntg strpu[a:r1 :unrs. mu!!iples ur perceruages. and idertuj}' phases ro u•/ricb /xrrttter/ur nre[(K.ds of onn/rensutt.a apple. tj ._. neressan~/ / w n --~----~--- r_,. _r ca ... i!__ _._,. _,. ,. a...d .... .. a. ,. ..L.-0.. L. ,..,71 1... .... ...... ,..+.. .J +., ~ 1 ,.~~_s-.,r ~-c~rrrrcttut ~ ~ it~u~ ~,v.a~.~ u~\. 1V411M1 ~ ~...... A stipulated lump sum fee of $107,000.00 AIA DOCUMENT 8141 • <)~7t'NER-ARCHITECT .AGe2EE?LENT • FOURTEENTH EDITION • AlA~ • ©19H7 THE A~IERICA~ I~STiTCTŁ OF .ARCHITECTS. 1": c XE~(' YORK AVENUE. N W., WASHINGTON, D.C. _'(I111Xt (One Hundred Seven Thousand and No/100 Dollars 8141-1987 8 WARNING: UnBcensed photxopying violates U.S. copyright laws and is subject to legal prosecution. 11.2.2 Vl'hrrr compensation is based un a stipulated sum or percentage of Construction Cost, progrccs payments for Basic Sen•ices in rach phase shall total thr following percentages of the total Basic Comprnsation payable: (/ns.+r mlrlrrrn,url plxtaa as apprt+priate.) Schematic Design Phase: F1 fteen percrnt (15 %) Design De~•rlopment Phase: Twenty percent(20 ~°) Construction Documents Phase: FO rty percrnt (40 %) Bidding or Negotiation Phase: F 1 Ye percent ( 5 g~°) Construction Phase: Twenty percent (20 °~°) Total Basic Compensation: 11.3 COMPENSATION FOR ADDITIONAL SERVICES one hundred percent (100°) 11.3.1 FOR PROJECT REPRESENTATION BEYOND BASIC SERVICES, as described in Paragraph 3.2, compensation shall be com- puted as follows: To be negotiated prior to any work being performed. 11.3.2 FOR ADDITIONAL SERVICES OF THE ARCHITECT, as described in Articles 3 and 12, other than (1) Additional Project Representation. as described in Paragraph 3.2, and (2) services included in Article 12 as part of Basic Services, but excluding sertices of consultants, compensation shall be computed as follows: ^ (hrsert basis aj iompe+rsattwr. inclrrdirrg rates a+:,f•,r nru/t(pfes o/Diretl Pprsorute! Fxpertse jor Principals a+tG enrplnrees, and iOrntijl• Prrrrcrpa/s and c/assrjP rnrplrn ees. rj rr,luired /dentijr specific sen•ice= -r. u~bicb part(cular methods of rnmpensatio+r applt: ij rtxessarg) r To be negotiated prior to any work being performed. ~__ :??{~r + 11.3.3 FOR ADDITIONAL SERVICES OF CONSULTANTS, including additional structural, mechanical and electrical engineering services and those provided under Subparagraph 3.4.19 or identified in Article 12 as part of Additional Services, a multiple of One and One tenth ( 1.10 }tunes the amounu billed to the Architect foe such services. (/derrlijr sperijtt hpes ojmnsultants in Artide )-. ij ra•/uirrd_) 11.4 REIMBURSABLE EXPENSES 11.4.1 FOR REIMBURSABLE EXPENSES. u described in Paragraph 10.2, and any other items included in Article 12 as Reimbursable Expenses, a multiple of One and 0 ne tenth ( 1.10) times the expenses incurred by the Architect, the Architect's emplo}•ees and consultants in the interest of the Project. 11.5 ADDITIONAL PROVISIONS _ 11.5.1 IF THE BASIC SERVICES covered by this Agreement have not bern completed within twel Ve months ( I Z ) months of the date hereof, through no fault of the Architect, extension of the Architect's services beyond that time shall be compensated as provided in Subparagraphs 10.3.3 and 11.3.2. are due and payable ( )days from the date of ' -- ~ Amounts unpaid _ e s interest at the rate entered below, or i reo at c legal rate pre.•ailing from time to time at the principal p ace o 'test. /insert rate of rnrer[st agreed upon./ -~ (Usury loos and requrrements under the Federal Tr,,tb in Lendi»g Act, similar state a,dloca/ mresumer credit lams and order regulations at the Ou•rrer's and Archi- tecr's prtncrpa/ places u/business. the location u/ the Project acrd edsewbere may ajjerr the ralidiry of this prr,risron. Specific legal advice should be obtained wuh respect v, delettrns rr modijiuttions. and also regarding requirements such as written disclosures or uwir+ers.) AIA t>~OCUFRENT 8141 • OWNER•ARCHITEC7 AGREEMENT • FOURTEE!:TH EDITION • AtA• • ©1997 °' 9 8141-1987 THE AMERICAN tNSTITtrrE OF ARCHITECTS, 1735 NEW YORK AVENUE, ~ w'., WASItINGTON, D.C.:0006 WARNING: Unlicenseo photocopying violates U.S. copyright laws and is subject to legal prosecution. 11.5.3 The rates and multiplcs sct forth for Additional Scrvica shall be annually adjustcd in acrnrdancc with normal salary rcvicw '~' practices of the Architect. ARnc~E ~z OTHER CONDITIONS OR SERVICES (l~csert desrnpt(ons of other services, (dentiJy Add(ttonat Servtca (nduded uitbin Bask ComPensatJOtr and tnod(ficat(oncs ro the paymen(anG a~nperesation (erns Included in Ibis Agreement.) _ 12.1 If a dispute arises out of or related to this contract, or the breach thereof, and if said dispute cannot be settled through direct discussions, the parties agree to first endeavor to settle the dispute in an amicable manner by mediation through a renowned mediation service before having recourse to arbitration or a judicial forum. 12.2 Architect's services shall provide the Owner construction documents that - conform to the design criteria set forth in the ACA Standards and Codes. Architect shall provide the Owner with Contract Documents that conform to tj~e design standards and facility requirements o~ the Texas Juvenile Probation _ Commission (including, but not limited to, applicable requirements of Title 37, Chapter 343 of the Texas Admin'strative Code or any amendments or recodifications thereof), the ACA, and other applicable standards, codes and laws, including the Americans with Disabilities Act and all regulations - promulgated thereunder. 12.3 Progress Payments for Basic Services shall be made according to the following _ schedule. Payments are contingent upon financing of the project and financial draws as follows: First Financial Draw $32,100.00 An amount based on the percentage of completion of Basic Services for each subsequent Financial Draw. Progress Payments will be made to the Architect within five days after the Owner has received each Financial Draw. 12.4 Architect's Basic Services shall include civil engineering consultation. This Agreement cntered into as of the day and year first writtcn above. CONTINUED...... . O (Signatuse) (Pn"rated name and title) l l CAUTION: You should sign an original AIA document which has this caution printed in red. An original assures that changes wlli not be obscured as may occur when documents are reproduced. AIA DOCUIMEM 8141 •OWNER-ARCHITECT AGREEMENT ~ FOURTEENTH EDITION ~ AIAe • ®1987 THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 20006 B14~-~ 987 t O WARNING: Unlleensed photocopying violates U.S. copyright laws and Is wbjeet to legal pioseeutlon. 11.5.3 The rata and multlplcs set forth for Additional Services shat! tx annually adjtutcd in accordancc with normal salary rcvicw "- practices of the Architect. ARTICLE 12 OTHER CONDITIONS OR SERVICES (tnseK descrtpltoras of other aerv(ces, laentijy Additlond Seroica lnduGeG eultbin Britt Conrpensatton aid nmidfJtratlons to the payment and compensation terms b+cludad !n tGls /IgfMne7tt.) _ 12.5 Architect understands and agrees that the sole source of funds to pay the compensation due to the Architect hereunder shall be the funds specifically escrowed therefor under the Escrow Agreement relating to the Kerr County Juvenile Facility signed on or about March 31, 1994 (hereinafter "Escrow _ Agreement"), and that all such payments of compensation to the Architect shall be subject to and in accordance with the procedures set forth in said Escrow Agreement. Further, the Architect agrees that in no circumstance - shall the Kerr County Juvenile Board or Kerr County, Texas be responsible or liable for any fee or compensation due to Architect hereunder or for any ' damages, costs, or expenses incurred by the Architect. 12.6 Owner is acting as Developer to create a detention facility on behalf of and for the Kerr County Juvenile Board acting as Agent for Kerr County, Texas, and the Architect's services shall be for the benefit of the Board as well as - the Owner. In consideration of the Board's execution of the Lease Purchase Agreement and future consent to draws under the Escrow Agreement where appropriatE the Architect hereby agrees that Architect owes a duty to the Board to provide - services under. 'this Agreement in accordance with the terms of the Agreement and in accordance with the standards and practices applicable to its profession. Furthermore, the Architect agrees that it shall act in the interest of the _ Board in reviewing applications for payment and draw requests, and that such payment and draw requests shall be verified by the Architect as true and correct and substantiated by appropriate evidence. Draw requests shall be on the form and by the method required under the Escrow Agreement. CONTINUED.. This Agrecment entered into as of the day and yrar first written above. OWNER (Stgrtcuurr) (printed name and title) ARCHITECT (Signature) (Punted name and title) I I CAUTION: You should sign an original AIA document which has this caution printed to red. An original assures that changes will not be obscured as may occur when documents are reproduced. AIA DOCUMEM 8141 • OWNER-ARCHITECT AGREEMENT • FOURTEENTH EDIT70N • AIAe • ®1987 THE AMERICAN INSTTfUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 20006 81411957 I O WARNING: Unikensed photooopyirg violates LLS copyright laws and is wbJect to legal prosecution. 11.5.3 The rates and multiples set forth for Additional Services shall tx annually adjusted In accordance with normal salary review ~' practiccs of the Architect. ARTICLE 12 OTHER CONDITIONS OR SERVICES (Insert descriptions of other services, tdenttjy Additional Serutces included u~ttNn Basic Compercmtion and matijications to the payment and compensation terms trtcluded in arts .4,grc~ement-J 12.7 Architect shall maintain acceptable professional liability insurance which provides coverage for the services provided under the Agreement. Architect shall provide the Owner and County Attorney with proof of acceptable - professional liability insurance within five (5) days from any request therefor. 12.8 The laws of the State of Texas shall control with regard to the construction _ and interpretation of this Agreement, and shall be applicable to all disputes and actions based on or under the terms of this Agreement. This Agreement shall be deemed in all respects performable in Kerr County, Texas, and venue of any disputes shall lie in a court of competent jurisdiction in _ Kerr County, Texas. This Agreement entcred into as of the day and year first written above. ARCHITECT (Signature) (Printed _ I 1 CAUTION: You should sign an original AIA document which has this caution printed in red. An original assures that changes will not be obscured as may occur when documents are reproduced. AIA DOCUMENT 8141 •OWNER-ARCHITECT AGREEMENT • FOURTEENTH EDITION • AIA • ©1987 THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W., WASHINGTON, D.C. 20006 8141-1987 I O WARNING: Unlicensed photocopying violates U.S. topyrigM laws snd is subieet to legal proseeutlon. (~ DEVELOPMENT AGREEMENT _ This Development Agreement (hereinafter "Agreement") is entered into by and between the Kerr County Juvenile Board as Agent for Kerr County, Texas (hereinafter "Board") and RECOR, INC. (hereinafter "Developer") on this I i- _~Ziay of July, 1994. RECITALS - WHEREAS, the Developer has submitted a proposal to the Board for the financing, design, construction and operation of a 48 bed secure regional juvenile detention facility (hereinafter "Facility") to be constructed in accordance with all standards, rules and regulations _ of the Texas Juvenile Probation Commission, the standards of the American Corrections Association, all applicable fire and safety codes, the Americans with Disabilities Act and regulations promulgated thereunder, and in accordance with all other applicable laws whether they be Federal, State or Local in nature, and WHEREAS, the parties desire this Agreement to constitute a contract whereby the Developer will provide the design, financing, and construction of the Facility on the site approved by the Board. _ NOW, THEREFORE, for and in consideration of the benefits to accrue to each of the parties, the receipt and adequacy of which is hereby acknowledged, the parties hereby contract, _ covenant and agree that: I. PRE-CONSTRUCTION AND DESIGN 1.01 The Developer shall immediately after the date hereof execute a contract with an architect (hereinafter "Architect") acceptable to the Board for the design and preparation of - architectural and engineering plans and specifications for the proposed Facility in conformance with all standards of the Juvenile Probation Commission, American Corrections Association, and other applicable law, including all local codes and regulations and the Americans with - Disabilities Act. Such architectural contract shall contain such terms that are approved by the Board and its counsel. The contract shall clearly set forth that the architectural fees are payable solely out of the amounts contained in the Construction Account established under that certain "J Escrow Agreement relating to the Kerr County Juvenile Facility made by and between Chicago Corporation, the Kerr County Juvenile Board, RECOR, INC., and ChiCorp Financial Services _ on or about March 31, 1994. It shall be the Developer's responsibility to assure that sufficient amounts are budgeted from the Construction Account or other amounts received by the Developer to pay the Architect, and Developer shall be directly liable and responsible for any _ amounts payable to the Architect under the architectural contract and indemnifies and holds the Board and County harmless for any such amounts. The Developer shall cooperate with the Architect, and warrants and guarantees the performance of the Architect of each and every duty _ and condition provided in this Agreement, all proposals for this Facility submitted, the Lease Purchase Agreement, and the Operations & Management Agreement for and with respect to the design, plans, and specifications for the Facility, whether provided by the Architect, engineer __ or otherwise. 1.02 The Developer shall submit all plans prepared by the Architect to the Board for approval, which shall take action thereon within ten (10) days of receipt thereof unless additional - time is needed for review, including approval of site plans, Schematic Design Documents, Design Development Documents, Construction Documents and the Contract Documents. Approval by the Board shall not release the Developer nor the Architect from any obligation, - warranties or claims with regard to their performance under this Agreement or the architectural agreement. -' 1.03 The Developer shall obtain all land necessary for the construction of the Facility and provision of Facility services and programs at a site submitted to and approved by the Board. The land shall be sufficient in size, geology, and topography for the location of the Facility, and such matters shall be certified to the Board by the Developer and Architect upon submission of the site for approval. The land may not be acquired prior to approval by the _ Board of said land and site. The Developer shall obtain good and marketable title to the property free and clear of all liens and encumbrances save and except those encumbrances that the Board accepts, and those in accordance with and acceptable under the Lease Purchase _ Agreement and Escrow Agreement. The Developer shall obtain a mortgage title policy and owner's title policy. The Developer shall take no action to cause any lien to be asserted against the land, and shall assure that its contractors and subcontractors do not create any lien or encumbrance upon the property. In any case, the land shall be acquired and maintained in a way so that title is acceptable to the Board and ChiCorp Financial Services, Inc., as assignee of all of the Lessor's interest and rights under the Lease Purchase Agreement, and so that upon the _ payment of all lease obligations by the Board the title passes to the Board free and clear of all liens and encumbrances not expressly accepted. - 1.04 The sole source of funds for payment of land acquisition costs, including title policy and closing costs, legal fees, survey fees, and other such costs and expenses is the fund established therefor under the Escrow Agreement, and the Board and County shall have no - liability or responsibility therefor other than the responsibility to pay the lease payments in accordance with the Lease Purchase Agreement, and only to the extent required therein. II. CONSTRUCTION 2.01 The Developer shall enter into contracts for the construction of the Facility. The ~" Contract of Construction shall be with a good and reputable contractor acceptable to the Board, and shall be in a form containing substantially the same terms as contained in AIA Document _ A101. There shall be a 10% retainage requirement in all Construction Contracts. All costs of construction shall be included in the construction budget. In no event shall the Board or the County be responsible for payment of any such contracts or construction costs, and it is agreed _ that the sole source of funding for such contracts and costs is the fund maintained in the Construction Account pursuant to the Escrow Agreement. In no event shall the total amount of project costs for the construction of the Facility exceed the amount allocated therefor in the _ Construction Account under the Escrow Agreement, and Developer shall, in coordination with the Architect, use its good faith and best efforts to assure that the project stays within the proposed construction budget, and shall be solely accountable for any cost overruns. The term Development Agreement Page 2 Kerr County Juvenile Facility "project costs" shall mean all costs and expenses incidental to and reasonably necessary for the acquisition, financing, design, construction, furnishing, and certification of the project, _ including, but not limited, the cost and expenses for all land acquisition and closing costs, amounts owed to the Developer under this Agreement, if any, consulting and professional fees, financing fees, permits, insurance during construction, utilities to site, construction, furnishing - and supplies, equipment, inspection and contingencies. 2.02 The Developer shall provide oversight, supervision and coordination of design, - construction and certification of the Facility; provided that Developer shall work in conjunction and harmony with the Architect. The Developer will provide all services necessary to present the Board with a completed Facility that meets all applicable standards and codes as constructed, and which is ready and certified by the Texas Juvenile Probation Commission and the Board for occupancy by Resident Clients, and to assure compliance with all budgetary and time constraints. - 2.03 The following shall be the approved budget for the project, and the Developer shall make every reasonable effort to complete and obtain certification of the project at a cost not to exceed the total budget amount. Further, the Developer shall obtain the Board's authorization and approval prior to incurring any cost or liability in excess of the total budget amount for any following line items: Description: Bid Amount: Legal Finance Bonding Insurance Title Policy Sub-Total Building Construction - Land Utilities & Site Prep. F.F. & E. Security & Surveillance Architect & Engineer Start Up Costs _ Adm. & Inspection Total Project Costs $ 15,000.00 $ 25,000.00 $ 39,000.00 $ 9,000.00 $ 37,000.00 $ 125,000.00 $1,634,318.53 $ 70,000.00 $ 100,000.00 $ 190,000.00 $ 115,000.00 $ 107,000.00 $ 250,000.00 $ 75,000.00 $2,666,318.53 In no circumstance shall the total costs, including all compensation to the Developer, exceed the amount escrowed therefor under the terms and conditions of the Escrow Agreement. Development Agreement Page 3 Kerr County Juvenile Facility 2.04 The Developer and its contractor will indemnify and hold the Board and the County harmless from all claims or causes of action of any kind, including all claims for bodily - injury, sickness and property damage, which may arise from Developer's and contractor's operation under this Agreement and/or the Construction Contract. - 2.05 The Developer will purchase and maintain, or cause the Contractor to purchase and maintain, such insurance as will protect Contractor from the claims set forth below which may arise out of or result from the Contractor's operations under this Agreement whether such -' operations be by Contractor or by any subcontractor or by anyone directly or indirectly employed by any of them, or by anyone for whose acts any of them may be liable, including, but not limited to: Claims under workers' compensation, disability benefit or other similar employee benefit acts which are applicable to the work to be performed. Claims for damages because of bodily injury, occupational sickness or disease, _ or death of his employees under any applicable employer's liability law. Claims for damages because of bodily injury, or death of any person other than _ his employees. Claims for damages insured by usual personal injury liability coverage which are _ sustained (1) by any person as a result of an offense directly or indirectly related to the employment of such person by the Contractor or (2) by any other person. -- Claims for damages, other than to the work itself, because of injury to or destruction of tangible property, including loss of use therefrom - Claims for damages because of bodily injury or death of any person or property damage arising out of the ownership, maintenance or use of any motor vehicle. -' 2.06 The Developer will purchase and maintain, or cause the Contractor to purchase and maintain, Comprehensive General Liability Insurance which shall include premises- operations, (including explosion, collapse and underground coverage) elevators, independent - contractors, completed operations, and blanket contractual liability on all written contracts, all including broad form property damage coverage, with limits of liability not less than the following: 1. Comprehensive General Liability. Standard Texas Form with Combined Single - Limit covering Bodily Injury, Property Damage, and Completed Operations in an amount not less than $2,000,000.00. Development Agreement Page 4 Kerr County Juvenile Facility - 2. Comprehensive Automobile Liability a. Bodily Injury $100,000.00 Each Person $300,000.00 Each Occurrence - b. Property Damage $100,00.00 Each Occurrence Comprehensive General Liability Insurance may be arranged under a single policy for the full - limits required or by a combination of underlying policies with the balance provided by an Excess or Umbrella Liability Policy. - 2.07 The Developer shall provide, or cause the Architect and the Engineer to provide, professional liability or an errors and omissions insurance policy for the benefit of the parties hereto. The policy shall name the Board and County as insureds and the Developer as an - additional insured. 2.08 The Developer shall maintain, or shall require that the Contractor maintain, - builders risk insurance at all times prior to the completion of the Facility and, in the event of any casualty prior to the completion of the Facility, the proceeds of such insurance shall be used _ by the Developer and such Contractor to repair or replace the damaged portion of the Facility. 2.09 All of the policies of insurance referenced above shall name the Board and County as an additional named insured and shall contain a provision that coverages afforded thereunder will not be cancelled or not renewed until at least sixty (60) days' prior written notice has been given to the Board and the County. Certificates of Insurance showing such coverages to be in -- force shall be filed with the Board and the County prior to commencement of the Work. 2.10 The Developer shall provide Performance and Payment Bonds pursuant to Chapter - 2253, Government Code (Vernon's 1994) before the Contractor commences work, and shall perform and provide each and every duty, work, responsibility and service necessary to the design, construction and final acceptance of the Facility, pursuant to the terms, conditions, - provisions and requirements of the Construction Contract. The Construction Contract shall be additionally accompanied by adequate and appropriate builders risk insurance, commercial general liability insurance, workers compensation, and automobile liability insurance, in each _ case naming the Board and County as additional insureds, in such amounts as shall be approved by an authorized representative of the Board and County. - 2.11 Time is of the essence on this Project. The Contract of Construction shall provide for substantial completion of the Facility no later than February 1, 1995. 2.12 The Developer shall obtain all required permits and approvals necessary for the construction of the Facility, and shall obtain all required approvals and certifications of the Texas Juvenile Probation Commission for the Facility during construction and/or at substantial and/or final completion. Development Agreement Page 5 Kerr County Juvenile Facility _ 2.13 Upon substantial completion of the Facility as certified by the Architect, the Developer shall provide the Board with a certificate representing that the acquisition, _ construction, equipping and furnishing of the Facility is substantially complete in accordance with the Contract Documents, proposal of RECOR, the ACA and TJPC standards, and all other applicable standards and regulations, and that the Facility is available for occupancy and use. 2.14 Changes in plans and specifications (Contract Documents) during the construction and equipping of the Facility must be approved in writing by the Board or its designee. 2.15 Payment for construction costs and services shall be made on the basis of progress payments. The process of application for and certification of payment shall be as set forth in -' the Architectural Agreement and Construction Contract, however, the additional step of the submission of a formal Draw Request as required by the Escrow Agreement shall be required before the funds for the payment of any amounts applied for and certified can be released from _ escrow. The Draw Request will be in the form required by the Escrow Agreement, and shall be accompanied by such supporting data substantiating the right to payment of the funds as the Architect, Board, Lessor (or its assignee), and/or Escrow Agent may require. 2.16 Final Completion will be achieved when all "punch-list" items have been _ completed and all required approvals for occupancy of the Facility have been obtained by the Developer. _ 2.17 A complete project schedule will be submitted to the Board within thirty (30) days of this Agreement being executed. _ 2.18 All amounts payable under this Agreement or for the Project, whether or not for construction, are subject to the Draw Request procedure set out in the Escrow Agreement, and shall be accompanied by such supporting data substantiating the right to payment of the funds - as the Architect, Board, Lessor (or its assignee), and/or Escrow Agent may require. III. PAYMENTS TO DEVELOPER The Escrow Agreement provides for $2,962,000.00 to be deposited in various accounts by the Escrow Agent. Under the terms of the Escrow Agreement, $211,785.00 is to be placed in the Payment Account as capitalized interest for the payment of interest on the Facility during construction, $83,896.47 is to be placed in the Payment Account as the Rental Deposit, and the balance of the money is to be placed in the Construction Account. Payments to the Developer _ from the Construction Account under this Agreement shall be as set forth in the Escrow Agreement. Notwithstanding the foregoing, the Board may direct the Escrow Agent to retain from payments to the Developer an amount which will insure that there are sufficient funds at all times to complete the Project, and may direct that payments of certain amounts be made directly _ to a contractor or creditor of the Developer if the same is deemed necessary by the Board. Development Agreement Page 6 Kerr County Juvenile Facility IV. ASSIGNMENT _ Except as specifically provided above and in the Lease Purchase Agreement, no party hereto shall be entitled to assign its rights or obligations hereunder without the prior written consent of the other Party hereto. Any attempted assignment without the prior written consent- - of the other Party (except as set forth above) shall be null and void. V. AMENDMENT This Agreement can only be amended by a written instrument executed by the Parties hereto. VI. LIABILITY OF COUNTY a' Except for the obligations of the Board/County specifically set forth herein, the Board/County shall have no liability with respect to the performance of any provision hereof. _ Under no circumstance shall the Board/County be responsible for any amounts payable hereunder, or under other contracts entered into to achieve the acquisition and construction of the Facility, save and except lease payments due under the Lease Purchase Agreement, and only _ to the extent set forth therein, its sole responsibility being to consent to the release of Escrow Funds where proper. VII. GOVERNING LAW This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Texas. Venue for any action arising under this Agreement or any related documents shall be in Kerr County, Texas - EXECUTED on July ~~, 1994. - KERR COUNTY JWENILE BOARD RECOR, INC. t, ! G ~L By: - d By: Name: William G. St cy Name: Glenn Heckm nn Title: County Judge Title: President ATTEST: By: orporate ec Development Agreement Page 7 Kerr County Juvenile Facility ~ :~ Q ls~~~ TY DE D THE STATE OF TEXAS ~ VOL ~~~1. PAGfU<.~~ KNOW ALL MEN BY THESIS PRESENTS -" CQUNTY OF KERR ~ THAT SCHRExNER'COLLEGE, acting herein by and through its duly .- authorized officers, hereina:~ter referred to as "GRANTOR", whether one or more, for and in consideration of the sum of TEN AND NO/100 ($J.0.00) DOLLARS cash, and other good and valuable consideration, in hand paid by RECOR, ZNC. , hereinafter referred to as "GRANTEE" , whether one or more,•receipt of which ~.s hereby acknowledged, and for rahich no ].sett, expressed, or implied, is zetained or shall exist, has GRANT$D, SARGAzNLD, SOLD and CONVEXED, and by these - presents does GRANx, El~aRGAIN, SELL and CONVEY unto GRANTEE, the property, lying and being situated in Kerr County, Texas, together with all rights, benefits, privileges, tenements, hereditaments and -_." appurtenances thereon or in anywise appertaining thereto and together with any and all improvements thereon (collectively, the "property") described as follo~rs: All that certain tract or parcel of land lying and being situated in the County of Kerr, State of Texas, more particularly described in and subject to the exceptions - st$ted in Exhibit "A" attached•hereto and made a part hereof for all purposes. TO RAVE AND TO HOLD the Property, together With, all and singular the rights and appurtenances thereto a.n anywise belonging, subject as aforesaid, unto GRANTEE, and GRANTSE's successors and assigns, forever; and GRANTOR does hereby hind GRANTOR, and •` GRANTOR'S successors to WARRANT AND FOREVER DEFEND, all and singular the Property, subject as aforesaid, unto GRANTEE, az~d GRANTE$'s successors and assigns against every person Whomsoever - lawfully claiming ar to claim the same or any part thereof. EXECUTED this the `11th day of October, X994. - SCHREIN COLLEGE FILED aR f~~CO BY: l~ - 3 . ~ M Name : , ' ~ 'k . .,..,..... Title : f- +~' at.....,.... _ Q~T 2 7 1994 ~~ t ~ ~• ~ ~ ~ , ' o~tnf 7 as Name : Gar ett Mynatt ~ my ou ep~iY Title: Vice President for Business ~ ~ ~ ,~(,~ ~~ Affairs 9\10e~.aes\47D01 vas ~~~~ pacE~~~ THE STATE Ok' TEXAS § COUNTY OF RERR § Th~.s document was subscribed and sworn to before me this j/~ ~~ ~~ day of October, 1994 by l SAM M. JUMCxN_ , ~ President of SCHREINER COLLEGE, on behalf of said SCHREYNER COLLEGE, and in the capacity herein stated. ~~,~~,~ Jimmie L. Peschel N public, State of Texas Notary Public ' '~ ~ STATE OF TEXA5 '~'a+~`'~ tAr Caem~. Exp.1-3t-97 T'8 COUNTY OF KERR ~ -- Th.a.s document was subscribed and swam to before me this /~~ day of Octabex, 1994 by GARRETT MYNFSTT, Vine President far Busi.iness Affairs of SCEREINE~t COLLEGE, on beha7:f of said 5CHREINER COLLEGE, _ and in the capacity herein stated. ~ M. Jimmie I.. PesChel - ~ ~ « kocary Pubtk STATE OF TEl(AS ~''~~ ~~ 1~rcaan. ~-.1~i-97 1~+~~ Gra s s RECOR, Inc. 912 Balcones Ar.~ Suite 250 Austin Texas 1 t • o ry PubYic, State of Texas RECORDER'S NO1F JIT 11ME QF RECOf~3AilON t~lStAU1r~N7" i~1PtD _ r m ~E tAi~ FOR BESTPFIQTpp~PMC ~'}'~, ~(` ~AOOUCi'10N DtfE 70 O~TE14 QAJ6S OF t'Filt~lF, COCOROF PAWTO~i IMK, BJiCKGROilNd OP P/1F~ lll.i:GiBf1t7Y, CARSON OR PIi017p COPY, ETG. Ascosiu RAa~! ~ ep~ r i!`Y --- VcSt, 7 7 / PG ~ _ tt~aNa oars ~aMX~ A~~D oCT 2~ 1994 ~ ~~~ ~~ ~ ~~~ Prow~orn ner~a+~,Mtr+dtM at~.~~auNddNdllaA~d p~pNti a~wdodorontp ~wMd~nou~am+~~FIdIGdl~t+ 1~11~fi~~TAIEQFTE1~l~6~ CCIM~rpF ~d~~MAtfO~nFiMNwnbrS~~G~siM "i0a~lcR~oae~ot ~Mp1p aio~~ae ~AoE~tnme oC~ z ~ i9~4 ~~ .8~, ~ cfl~~mrcc>`.Ak~x~cou .Tats ~' 9\1o87.g95\47x01 EXHIBIT "A" von Q~~~ PACfQQQ PROPERTYt Lot 1, Block 1, and Lat 1, Black 2, Final Plat of RECOR SUBDIVISION, a subdivision according to map or plat recorded 3.n _ Vol.vme ~ 6 , Paget 212 of the Plat Records of Kerr County, Texas. EXCEBTSONSs 1. Taxes for 1994 and subsequent years. 2. Easement from the City of Kerrville to Lone Star Gas Company, retarded Volume ,J., Page 4U2 of the Easement Records of Kerr County, Texas. 3. Easement from the City of Kerrville to Lane Star Gas Company recorded in Volume 5, Page 21 of the Easement, Records of Kerr County, Texas. 4. Easement recorded in Volume 2, Page 26 of the Easement Records of Kerr County, Texas, from Julia Elizabeth Nye _ to Lone Star Gas Company. a. Easement from R. Peschel]., et ux to 'texas Public Utilities Co., recorded in Volume 46, Page 396 of the _ Deed ReGOrds of Kerr County; Texas. 6. Easement from Rudolph Paschall, et ux t.o the Texas Powez & Light Company recorded in Volume 46, Page 627 of the Deed Records of Kerr County, Texas. 7. Easement from P. J. Kelly, et ux to Texas Power & Light _ Company recorded in Volume 54, Qage 241 of the Dead Records of Kerr County, Texas. _ 8. Easement to LCRA recorded in Volume 76, Page 355 of the Deed Records of Kerr County, Texas. _ 9. Easement from the City of Kerrville to L.C.R.A. recorded in Volume 2, Page 564 of the Easement Records of Kerr County, Texas. 10. Easements granted to the City of ~Cexrville in Deed recorded in Volume 180, Page 402 of the Deed Records of Kez'r County, Texas r 11. All matters shown on the Final Plat of RECOA SUBDIVISION, recorded or to be recorded in the Plat 12eaords of Kerr _ County, xexas. 9\067.095\E7fA E7C$IBIT "A" ~ 1 _ as1'7"7 ~vo~ 0771 PacEO`~7 DEED OF TRUST INCLUDING SECURITY AGREEMENT AND FINANCING STATEMENT - Date: October ? (/1994 Grantor: ReCor, Inc. Grantor's mailing address: 5912 Balcones Drive, Suite 250, Austin, Texas 78731 Trustee: Victor Elting, III _ Trustee's mailing address: 208 South LaSalle, Chicago, Illinois 60604 Beneficiary: ChiCorp Financial Services, Inc. Beneficiary's mailing address: 208 South LaSalle, Chicago, Illinois 60604 - The Lease: The Lease-Purchase Agreement, dated March 31, 1994, executed by Grantor, as Lessor, and the Kerr County Juvenile Board, as Lessee (the "Lease"). The Lease for purposes of this Deed of Trust shall include all other leases executed in substitution therefor or in modification, renewal or extension thereof, in whole or in part. Lease Payments: The payments, including interest, as set forth and described in Section 2.1 - of the Lease. Property: (a) The real estate (herein called the "Land") described in Exhibit "A" which is _ attached hereto and incorporated herein by reference, and (i) all buildings, structures, fixtures and improvements now or hereafter situated or to be situated on the Land (herein collectively called the "Improvements"); and (ii) all right, _ title and interest of Grantor in and to (1) all streets, roads, alleys, easements, rights-of--way, licenses, rights of ingress and egress, vehicle parking rights and _ public places, existing or proposed, abutting, adjacent, used in connection with or pertaining to the Land or the Improvements; (2) any strips or gores between the Land and abutting or adjacent properties; and (3) all water and water rights, Deed of Trust Kerr County Juvenile Facility 1 VOL 0~~1 FaCEQ,~~ __ timber, crops and mineral interests on or pertaining to the Land. The Land, Improvements and other rights, titles and interests referred to above are herein sometimes collectively called the "Premises." (b) All fixtures, equipment, systems, machinery, furniture, furnishings, inventory, accessions, goods, building and construction materials, supplies, and articles of _ personal property, of every kind and character, now owned or hereafter acquired by Grantor, which are now or hereafter attached to or situated in, on or about the Land or the Improvements, or used in or necessary to the complete and proper - planning, development, use, occupancy or operation thereof, or acquired (whether delivered to the Land or stored elsewhere) for use or installation in or on the Land or the Improvements, and all renewals and replacements of, substitutions - for and additions to the foregoing, including, but without limiting the foregoing, any and all fixtures, equipment, machinery, systems, facilities and apparatus for heating, ventilating, air conditioning, refrigerating, plumbing, lighting, - generating, cleaning, storage, incinerating, sewage or waste disposal, irrigation, fire extinguishing, communications, transportation, data processing, security and alarm, laundry, food or drink preparation, gas, electrical and electronic, and - recreational uses or purposes; all tanks (but excluding underground storage tanks unless such tanks are specifically described herein), pipes, wiring, conduits, ducts, doors, partitions, rugs and other floor coverings, wall coverings, windows, _ drapes, window screens and shades, awnings, fans, motors, engines and boilers; and decorative items and art objects. The properties referred to in this paragraph are herein sometimes collectively called the "Accessories." (c) All (i) plans and specifications for the Improvements; (ii) Grantor's rights, but not _ liability for any breach by Grantor, under all commitments, insurance policies, construction contracts, architectural contracts, engineering contracts and other contracts and general intangibles (including but not limited to trademarks, trade _ names and symbols) related to the Premises or the Accessories or the operation thereof; (iii) deposits (including but not limited to Grantor's rights in tenants' security deposits, deposits with respect to utility services to the Premises, and any _ deposits or reserves hereunder or under any other Loan Document for taxes, insurance or otherwise), money, accounts, instruments, documents, notes and chattel paper arising from or by virtue of any transactions related to the Premises - or the Accessories; (iv) permits, licenses, franchises, certificates and other rights and privileges obtained in connection with the Premises or the Accessories; (v) leases, rents, royalties, bonuses, issues, profits, revenues and other benefits of the - Premises and the Accessories; (vi) oil, gas and other hydrocarbons and other minerals produced from or allocated to the Land and all products processed or obtained therefrom, and the proceeds thereof; (vii) engineering, accounting, title, - legal, and other technical or business data concerning the Property which are in Deed of Trust Kerr County Juvenile Facility 2 VOL 0~771P~GfOO9 - the possession of Grantor or in which Grantor can otherwise grant a security interest, and all books, files, records, magnetic media, and other forms of recording or obtaining access to such data; and (viii) other properties, rights, _ titles and interests specified in this Deed of Trust as being part of the Property. (d) All (i) proceeds of or arising from the properties, rights, titles and interest _ referred to in defining the Property, including but not limited to proceeds of any sale, lease or other disposition thereof, proceeds of each policy of insurance relating thereto (including premium refunds), proceeds of the taking thereof or of _ any rights appurtenant thereto, including change of grade of streets, curb cuts or other rights of access, by eminent domain or transfer in lieu thereof for public or quasi-public use under any law, and proceeds arising out of any damage thereto; - and (ii) other interests of every kind and character which Grantor now has or hereafter acquires in, to or for the benefit of the properties, rights, titles and interests referred to in defining the Property and all property used or useful in - connection therewith, including but not limited to rights of ingress and egress and remainders, reversions and reversionary rights or interests. If the estate of Grantor in any of the property referred to in defining the Property is a leasehold - estate, this conveyance shall include, and the lien and security interest created hereby shall encumber and extend to, all additional title, estates, interests or rights which may hereafter be acquired by Grantor in or to the property demised - under the Lease creating the leasehold estate. - Exceptions to Conveyance and Warranty: _ Any and all validly existing conditions and restrictions, relating to the above described property as now reflected by the deed records of the County Clerk of Kerr County, Texas. Granting Clause: For value received, the receipt and sufficiency of which are hereby acknowledged by Grantor, and to secure performance by Grantor and the Lessee of their respective duties pursuant to the Lease, including but not limited to the payment of the Lease Payments by Lessee, Grantor conveys the Property to Trustee in trust. If Grantor performs or causes to be performed all the covenants and conditions of the Lease, including payment of the Lease Payments to Beneficiary, this Deed of Trust shall have no further effect and Beneficiary shall release it at Grantor's - expense. - Deed of Trust Kerr County Juvenile Facility 3 ~~ot O771P~~~O~O Grantor's Representations and Warranties: Grantor represents and warrants that: (1) it agrees to defend the title to the Property; (2) it has given all notices and followed the process and procedures required by law to accept transfer of the Property and to authorize the execution of the Lease and this Deed of Trust; (3) it has good title to the Property subject to the Lease; and (4) the Lease is valid, unmodified and in full force and effect and no default exists thereunder. _ Grantor's Obligations: Grantor agrees, subject to appropriations therefor, to: (1) keep the Property in good repair and condition; (2) pay all taxes and assessments on the Property, if any, when due; (3) preserve the lien's priority as it is established in this Deed of Trust; (4) perform all of its obligations under the Lease, and to cause the Lease Payments to be made by Lessee, subject to - its terms, conditions and limitations, and give prompt notice to Beneficiary of any failure to do so; (5) maintain an insurance policy that: (a) covers all improvements for their full insurable value as determined when the policy is issued and renewed, unless the Lease provides for a _ lesser amount or the Beneficiary approves a smaller amount in writing; (b) contains an 80% coinsurance clause; (c) provides fire and extended coverage, including windstorm coverage; (d) protects Beneficiary with a standard mortgage clause; (e) provides flood insurance at any time _ the Property is in a flood hazard area; and (f) contains such other coverage as Beneficiary may reasonably require; (6) comply at all times with the requirements of the 80% coinsurance clause; (7) deliver the insurance policy to Beneficiary and deliver renewals to Beneficiary at least ten -' days before expiration; (8) keep any buildings occupied as required by the insurance policy; and (9) if this is not a first lien, pay all prior lien notes that Grantor is personally liable to pay and abide by all prior lien instruments. Beneficiary's Rights: (1) Beneficiary may appoint in writing a substitute or successor trustee, succeeding to all rights and responsibilities of Trustee. (2) Beneficiary may apply any proceeds received under the insurance policy either to reduce the Lease or to repair or replace damaged or destroyed improvements covered by the policy. (3) If Grantor fails to perform any of Grantor's _ obligations, subject to appropriations therefor by Grantor, Beneficiary may perform those obligations and be reimbursed by Grantor on demand at the place where the Lease is payable for any sums so paid, including attorney's fees, plus interest on those sums from the dates of payment at the rate stated in the Lease. The sum to be reimbursed shall be secured by this Deed of Trust. (4) If Grantor defaults on the Lease or fails to perform any of Grantor's obligations or if default occurs on a prior lien note or other instrument, and the default continues after -- Beneficiary gives Grantor notice of the default and the time within which it must be cured, as ,_ Deed of Trust Kerr County Juvenile Facility 4 VOL 0~771PAC~O~1 _ may be required by law or by written agreement, then Beneficiary may: (a) request Trustee to foreclose this lien, in which case Beneficiary or Beneficiary's agent shall give notice of the foreclosure sale as provided by the Texas Property Code as then amended; and (b) purchase the _ Property at any foreclosure sale by offering the highest bid. Trustee's Duties: If requested by Beneficiary to foreclose this lien, Trustee shall: (1) either personally or .._.. by agent give notice of the foreclosure sale as required by Section 51.002 of the Texas Property Code as then amended; (2) sell or convey all or part of the Property to the highest bidder for cash with a general warranty binding Grantor, subject to prior liens and to other exceptions to - conveyance and warranty; and (3) from the proceeds of the sale, pay, in this order: ( a ) expenses of foreclosure, including but not limited to, a commission to Trustee of 5 % of the bid, title and appraisal fees; (b) to Beneficiary, the full amount of the Lease Payments, interest, attorney's fees, and other charges due and unpaid pursuant to the terms of the Lease; (c) any amounts required by law to be paid before payment to Grantor; and (d) to Grantor, any balance. General Provisions: 1. If any of the Property is sold under this Deed of Trust, Grantor shall immediately surrender possession to the purchaser. If Grantor fails to do so, Grantor shall become a tenant at sufferance of the purchaser, subject to an action for forcible detainer. 2. Recitals in any Trustee's deed conveying the Property will be presumed to be true. _ 3. Proceeding under this Deed of Trust, filing suit for foreclosure, or pursuing any other remedy will not constitute an election of remedies. 4. This lien shall remain superior to liens created even if the time of payment of all or part of the Lease Payments is extended or part of the Property is released. 5. If any portion of the Lease cannot be lawfully secured by this Deed of Trust, payments shall be applied first to discharge that portion. 6. Grantor assigns to Beneficiary all sums payable to or received by Grantor from condemnation of all or part of the Property, from private sale in lieu of condemnation, and from - damages caused by public works or construction on or near the Property. After deducting any expenses incurred, including attorney's fees, Beneficiary may release any remaining sums to Grantor or apply such sums to reduce the Lease. Beneficiary shall not be liable for failure to collect or to exercise diligence in collecting any such sums. _ Deed of Trust Kerr County Juvenile Facility 5 'vo~0~~1Pac104? 7. Grantor assigns to Beneficiary absolutely, not only as collateral, all present and -' future rent and other income and receipts from the Property. Grantor warrants the validity and enforceability of the assignment. Grantor may as Beneficiary's licensee collect rent and other income and receipts as long as Grantor is not in default under the Lease or this Deed of Trust. _ Grantor will apply all rent and other income and receipts to payment of the Lease, satisfaction of the Lease Payments and performance of this Deed of Trust, but if the rent and other income and receipts exceed the amount due under the Lease and this Deed of Trust, Grantor may retain the excess. If Grantor defaults in payment of the Lease Payments or performance of this Deed of Trust, Beneficiary may terminate Grantor's license to collect and then as Grantor's agent may - rent the Property if it is vacant and collect all rent and other income and receipts. Beneficiary neither has nor assumes any obligations as lessor or landlord with respect to any occupant of the Property. Beneficiary may exercise Beneficiary's rights and remedies under this paragraph without taking possession of the Property. Beneficiary shall apply all rent and other income and receipts collected under this paragraph first to expenses incurred in exercising Beneficiary's rights and remedies and then to Grantor's obligations under the Lease and this Deed of Trust in the order determined by Beneficiary. Beneficiary is not required to act under this paragraph, and acting under this paragraph does not waive any of Beneficiary's other rights or remedies. If Grantor becomes a voluntary or involuntary bankrupt, Beneficiary's filing a proof of claim - in bankruptcy will be tantamount to the appointment of a receiver under Texas law. 8. Interest on the Lease Payments secured by this Deed of Trust shall not exceed the -- maximum amount of nonusurious interest that may be contracted for, taken, reserved, charged, or received under law; any interest in excess of that maximum amount shall be credited towards the Lease Payments or, if they have been paid, refunded. On any acceleration or required or - permitted prepayment, any such excess shall be canceled automatically as of the acceleration or prepayment or, if already paid, credited towards the Lease Payments or, if the Lease Payments have already been paid, refunded. This provision overrides other provisions in this and all other - instruments concerning the Lease Payments. 9. If all or any part of the Property or an interest therein is sold or transferred by _ Grantor without Beneficiary's prior written consent, Beneficiary may declare the Lease Payments secured by this Deed of Trust immediately payable. In that event, Beneficiary will notify Grantor that the Lease Payments are payable, in full; if they are not paid within twenty (20) days ~' after Grantor receives the notice, Beneficiary may, without further notice or demand to Grantor, invoke any remedies provided in this instrument for default. Beneficiary shall have waived such _ option to accelerate if, prior to the sale or transfer, Beneficiary and the person to whom the Property is to be sold or transferred reach an agreement in writing that the credit of such person is satisfactory to Beneficiary and that the interest payable on the Lease Payments secured by this Deed of Trust shall be at such lawful rate as Beneficiary shall request. If Beneficiary has waived the option to accelerate provided in this paragraph 9, and if Grantor's successor in interest has executed a written assumption of the Lease or a new lease, and said assumption or __ new lease has been accepted in writing by Beneficiary, Beneficiary shall release Grantor from _ Deed of Trust Kerr County Juvenile Facility 6 'von ~0~~1 Q~cFfl~~ all obligations under this Deed of Trust and the Lease. 10. With respect to any portion of the Property described in this Deed of Trust which constitutes personal property or fixtures governed by the Uniform Commercial Code of the State _ of Texas (hereinafter called the "Code"), this Deed of Trust shall constitute a security agreement between Grantor as the Debtor and Beneficiary as the Secured Party, and Grantor hereby grants _ to Beneficiary a security interest in such portion of the Property. Cumulative of all other rights of Beneficiary hereunder, Beneficiary shall have all of the rights conferred upon secured parties of the Code. Grantor will execute and deliver to Beneficiary all financing statements that may from time to time be required by Beneficiary to establish and maintain the validity and priority of the security interest of Beneficiary, or any modification thereof. Beneficiary may exercise any or all of the remedies of a Secured Party available to it under the Code with respect to the _ Property, and it is expressly agreed that, if upon default Beneficiary should proceed to dispose of the Property in accordance with the provision of the Code, then ten (10) days' notice by Beneficiary to Grantor shall be deemed to be reasonable notice under any provisions of the Code ._ requiring such notice; provided, however, the Beneficiary may at its option dispose of the Property in accordance with rights and remedies with respect to the Property pursuant to the provisions of this Deed of Trust, in lieu of proceeding under the Code. 11. Information concerning the security interest created by this instrument may be obtained from Beneficiary, as secured party, at the address of Beneficiary stated above. The mailing address of the Grantor, as Debtor, is as set out above. 12. No waiver of any default on the part of Grantor or breach of any of the provisions of this Deed of Trust or of the Lease shall be considered a waiver of any subsequent default or breach, and no delay or omission in exercising or enforcing the rights and powers herein granted shall be construed as a waiver of such rights and powers, and likewise no exercise or - enforcement of any rights or powers hereunder shall be held to exhaust such rights and powers, and every such right and power may be exercised from time to time. Acceptance by Beneficiary of partial payments shall not constitute a waiver of the default by failure to make full payments. 13. When the context requires, singular nouns and pronouns include the plural. 14. If any provision of this Deed of Trust is held to be illegal, invalid, or unenforceable under present or future laws effective while this Deed of Trust is in effect, the _ legality, validity and enforceability of the remaining provisions of this Deed of Trust shall not be affected thereby, and in lieu of each such illegal, invalid or unenforceable provision there shall be added automatically as a part of this Deed of Trust a provision which is legal, valid and _ enforceable and as similar in terms to such illegal, invalid or unenforceable provision as may be possible. If any of the Lease Payments should be unsecured, said unsecured portion shall be completely paid prior to the payment of the secured portion of such Lease Payments, and all _ payments made on account of the Lease Payments shall be considered to have been paid on and Deed of Trust Kerr County Juvenile Facility 7 ~o~ 0~7~71 PacE~4~ applied first to the complete payment of the unsecured portion of the Lease Payments. 15. This Deed of Trust shall bind, inure to the benefit of, and be exercised by successors in interest of all parties. EXECUTED this the 1lthday of October, 1994. ReCor, Inc. By: _ Name: Title: THE STATE OF TEXAS § - § Bruce C. Willial>~Y Chairman of the Board COUNTY OF KERR § Bruce This instrument was acknowledged before me on the(I day of October, 1994, by ~~ C. Williap~ls, Chairman of the Board of ReCor, Inc. -. ~ . o ry Public in and for the State of Texas ~µr Jimmie L. Peschel AFTER RECORDING, RETURN TO: ~' ~' Nlatary i~nlic STATE OF TEXAS Bickerstaff, Heath & Smiley, L.L.P. ~4~~~py ~rc«m,. Exp. 1-37-97 _ 98 San Jacinto Blvd., Suite 1800 Q~X'6~ ~~ Austin, Texas 78701 N Mp ~ ATTENTION: Barney L. Knight G~ F,L~ ~~~ ~2~1 ~-~f c.; cxa t ....... l~P ,_ ~~iN~tite~ i~ ~~~' OCT 2 71994 . .. ... ~tyCflUfi .@i ' t:111y :Xc`t~. ,~ ~~, Deed of Trust Kerr County Juvenile Facility g EXHIBIT "A" ~~o~ 077'1 PAGEQ45 PROPERTY: Lot 1, Block 1, and Lot 1, Block 2, Final Plat of RECOR SUBDIVISION, a subdivision according to map or plat recorded in Volume ~ 6 , Page ~ 212 of the Plat Records of Kerr County, Texas . EXCEPTIONS: 1. Taxes for 1994 and subsequent years. _ 2. Easement from the City of Kerrville to Lone Star Gas Company, recorded Volume 1, Page 402 of the Easement Records of Kerr County, Texas. - 3. Easement from the City of Kerrville to Lone Star Gas Company recorded in Volume 5, Page 21 of the Easement Records of Kerr County, Texas. 4. Easement recorded in Volume 2, Page 26 of the Easement Records of Kerr County, Texas, from Julia Elizabeth Nye _ to Lone Star Gas Company. 5. Easement from R. Peschell, et ux to Texas Public Utilities Co., recorded in Volume 46, Page 388 of the - Deed Records of Kerr County, Texas. 6. Easement from Rudolph Peschell, et ux to the Texas Power _ & Light Company recorded in Volume 46, Page 627 of the Deed Records of Kerr County, Texas. 7. Easement from P. J. Kelly, et ux to Texas Power & Light Company recorded in Volume 54, Page 241 of the Deed Records of Kerr County, Texas. - 8. Easement to LCRA recorded in Volume 76, Page 356 of the Deed Records of Kerr County, Texas. _ 9. Easement from the City of Kerrville to L.C.R.A. recorded in Volume 2, Page 564 of the Easement Records of Kerr County, Texas. i°' 10. Easements granted to the City of Kerrville in Deed recorded in Volume 180, Page 402 of the Deed Records of Kerr County, Texas. 11. All matters shown on the Final Plat of RECOR SUBDIVISION, recorded or to be recorded in the Plat Records of Rerr _ County, Texas. 9\1087.095\SXA EXHIBIT "A"- 1 V~~ 0~~71 ~~~fOQ G a~owa~w neon whcn n~tna tM wte, n~ a uN of ttu aildo~a o~Rr b~e~uNOtooio-a 1n0~f~tsir. T11E8TATEOF7EKAE onaao~cro~a~goo~du~-c~em~aion OCT 2 ~ i994 `~ • t'a Cou~rtvcx~ac,~ ~~/ ,~ AfiCORD va. ~ ~,~ ~c 37 v ~aNO o~rE OCT271994 ~~~ p~ YwA~ t ~nf~wV~! f v~ CHICORP FINANCIAL SERVICES, INC. May 25, 1994 - Ken County, Texas Attention: Honorable William G. Stacy County Judge - Ken County Courthouse Kerrville, TX 78028 - RE: Lease-Purchase Agreement ("Lease Agreement") between ReCor, Inc. ("Lessor") and Ken County Juvenile Board as agent for Ken County, Texas ("Lessee") Honorable Judge and Commissioners: _ ChiCorp Financial Services, Inc. ("ChiCorp") has purchased the Lease Agreement under the terms of an Assignment (the "Assignment") from ReCor, Inc. to ChiCorp. In consideration of the Lessee entering into the Lease Agreement in the form acceptable to ChiCorp, _ ChiCorp hereby represents and warrants to you as follows: 1. ChiCorp is an entity that comes within one of the categories listed under the _ definition of "accredited investor" under Rule 501(a) of Regulation D promulgated by the Securities and Exchange Commission in accordance with the Securities Act of 1933, as amended. We have sufficient knowledge and experience in financial and business matters, - including purchase and ownership of municipal lease and installment purchase obligations, to be able to evaluate the risks and merits of the investment represented by the purchase of the Lease Agreement. 2. ChiCorp has made its own inquiry and analysis, to the extent it has deemed appropriate with respect to the Lessee, the Lease Agreement and other material factors - affecting the credit standing of the Lessee, the security for the Lease Agreement and the ability of the Lessee to fulfill its obligations under the Lease Agreement. Copies of the Lease Agreement, and the Order dated March 31, 1994 of the Issuer authorizing the Lease - Agreement have been delivered to ChiCorp. ChiCorp understands that no financial information or statistical data in connection with this transaction has been reviewed by the _ Issuer or its attorneys, Haley Davis. ChiCorp acknowledges that no independent feasibility study has been prepared in connection with the Lease Agreement. 208 South LaSalle Street - Chicago, Illinois 60604 312.855.5880 AN AFFILIATE OF THE CHICAGO CORPORATION CHICORP FINANCIAL SERVICES, INC. 3. ChiCorp has had access to information, including financial statements, and other financial information, and such legal documentation as we deem necessary and has had the opportunity to ask questions and receive answers from individuals concerning the Lessee and its credit standing and the Lease Agreement, and we have made our own analysis as to the credit of the Lessee, the security of the Lease Agreement and Assignment, and the ability of the Lessee to make its payments under the Lease Agreement, so that, as a sophisticated investor, ChiCorp has been able to make its decision to purchase the bonds. - 4. ChiCorp understands that the Lease Agreement and Assignment (a) are not being registered under the Securities Act of 1933 and are not being registered or otherwise qualified for sale under the "Blue Sky" laws and regulations of any state, (b) will not be "' listed on any stock or other securities exchange, (c) will carry no rating from any rating service, and (d) may not be readily marketable. ChiCorp reaffirms that it is able to bear the economic risk of the investment for an indefinite period of time, and acknowledge that _ the Agreement and Assignment cannot be sold unless they are subsequently registered under such Act or an exemption from registration is available. 5. We acknowledge and represent that (i) there is no trustee or other party which has undertaken either orally or in writing, to assist in disposing of the land and facilities _ acquired under the Lease Agreement in the event sufficient funds are not appropriate to enable the Lessee to continue its obligations under the Lease Agreement in the event sufficient funds are not appropriated to enable the Lessee to continue its obligations under _ the Lease Agreement, and (ii) that there are no other contractual arrangements, expressed or implied, between us and any other party other than the Lessee or its agencies or departments, pursuant to which we would be entitled to receive financial benefits or _ managerial services which would affect the economic return under the Assignment. 6. ChiCorp acknowledges that the Lessee and its attorneys and financial advisors have made no representations regarding the quality, creditworthiness or liquidity of the Lease Agreement. ChiCorp has not relied upon any statements made by or any information prepared by the Lessee or its attorneys or financial advisors. 7. ChiCorp acknowledges that no placement memorandum or other disclosure document has been prepared by the Lessee in connection with the execution and delivery of the Lease Agreement. 8. ChiCorp is acquiring the Lease Agreement for the account of a single, - sophisticated, institutional investor (the "Investor"). The Investor is acquiring the Lease Agreement for its own account for investment and not with a view to dividing its _ participation with others or with a view to, or for resale in connection with, a "distribution" (as that term is used in the Securities Act of 1933, as amended, and Rules and Regulations of the Securities and Exchange Commission promulgated thereunder) of all or any portion thereof. The Investor has no present intention of selling, negotiating or otherwise disposing _ of the Lease Agreement of any participation therein; provided, however, the Investor retains the right and power at all times to dispose of its property. CHICORP FINANCIAL SERVICES, INC. 9. ChiCorp shall not assign or offer the Lease Agreement for sale without - complying with applicable securities laws and will not reassign this transaction without informing you in writing of such assignment. NAME & TITLE Ramona Regas, Senior Vice President SIGNATURE: Q,,yr~/+ru~- ~ . DATE: ~~a~/9~ TE ,~ a - OFFICE OF THE COUNTY ATTORNEY KERB COUNTY, TEXAS COUNTY COURTHOUSE, SUITE B20 - 700 EAST MAIN STRBBC KBRRVILLB, TEXAS 78028-3324 TBLBPHONB (210) 896-3338 FAX (210) 896-0304 "' DAVm M. MOTLEY, couxrr A7'rortlr6Y ILSB D. BAILBY, wssisr,~rrr oocrxrr wrtaRr~r HAROLD J. DANIORD, Asstsi'~x[ oouxrr ATTOR116Y "' April 28, 1994 Recor, Inc. 5912 Balcones Drive _ Suite 250 Austin, Texas 78731 Bickerstaff, Heath & Smiley, L.L.P. - Attorneys at Law 98 San Jacinto Blvd, Suite 1800 Austin, Texas 78701-4039 Re: Lease-Purchase Agreement dated as of March 31, 1994, between the Kerr County Juvenile Board, as Agent for Kerr "' County, Texas as Lessee, and Recor, Inc., as Lessor - Gentlemen: As County Attorney for Kerr County, Texas, counsel for Lessee, _ I have examined duly executed originals of the Lease-Purchase Agreement, dated as of March 31, 1994 (the Lease), between the Kerr County Juvenile Board, as agent for Kerr County, Texas, as Lessee, and Recor, Inc., as Lessor, and the proceedings taken by the Lessee - to authorize and execute the Lease. Based upon such examination and upon such other examination as I have deemed necessary, I am of the opinion that: (a) The Lessee is a duly created and validly existing governmental entity of the State of Texas and, for the purposes of the Lease, the duly appointed agent of Kerr - County, Texas, a political subdivision of the State of Texas authorized by the Constitution and laws of that state to enter into the transactions contemplated by the - Lease and carry out its obligations thereunder; v~ (b) The Lease has been duly authorized, executed and delivered by Lessee pursuant to Constitutional and/or _ statutory provisions which authorize transactions as here undertaken, and the Lease is a legal, valid and binding obligation on behalf of the Lessee, enforceable in accordance with its terms and conditions; (c) The signature of the official(s) which appear on the Lease and attached documents are true and genuine and the _ individual holds the office set forth below his/her name; (d) No approval, consent or withholding of objection is required from any governmental authority with respect to the entering into or performance by Lessee of the Lease or the transactions contemplated thereby, or if any such approval is required it has been obtained; (e) The entering into and performance if the Lease will not violate any judgment, order, law or regulation applicable _ to Lessee or result in any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest or other encumbrance upon any assets of the Lessee or on the property subject to the - Lease pursuant to any instrument to which the Lessee is a party or by which it or its assets may be bound; _ (f) There are no actions, suits or proceedings pending or, to our knowledge, threatened against or affecting Lessee in any court or before any governmental commission, board or authority which, if adversely determined, will have a - material or adverse effect on the ability of Lessee to perform its obligations under the Lease; - (g) The Commissioners Court of Kerr County granted an exemption pursuant to Section 262.024(a)(2), Texas Local Government Code, with respect to the public bidding _ requirements applicable to this transaction; and (h) To the best of my knowledge, all representations made by Lessee in the Lease are true and accurate as of this -- date . Sincerly. ': Davi~tley County Attorney DM/ib 2 Bickerstaff, Heath & Smiley, L.L.P. A REGISTERED LIMITED LIABILITY PARTNERSHIP SAN JACINTO CENTER, SUITE 1800 98 SAN JACINTO BOULEVARD AUSTIN, TEXAS 78701-4039 512~4~2-8021 FAX: 5121320-5638 October 11, 1994 VIA FAX (312) 855-6002 Ms. JoAnne Rogers Vice President _ ChiCorp Financial Services, Inc. 208 South LaSalle Chicago, Illinois 60604 STEVE BICKERSTAFF C. ROBERT HEATH' MARTHA E. SMILEY THOMAS M. POLLAN' ANN CLARKE SNELL ANDREW KEVER' CAROLVN E SHELLMAN DOUGLAS G. CAROOM' LINDA AAKER MVRA A. McDANIEL SUSAN C. GENTZ ROBIN A. CASEY KATIE BONG MANUEL O. MENDEZ' SYDNEY W. FALK, JR. DAVID MENDEZ' CATHERINE BROWN FRYER' PATRICIA E. RANT J. GREG HUDSON WILLIAM D. OUGAT III JESUS SIFUENTES DEBORAH HERZBERG LOOMIS BARNEY L. KNIGHT LYNN RAY SHERMAN MARGO L. FRASIER KEVIN W. COLE MICHAEL SHAUNESSV VALERIE P KIRK J. STEPHEN RAVEL GILBERT J. BERNAL JR. DIANA L NICHOLS CHRIS VON DOHLEN ERIC H. DRUMMOND SARA HARDNER LEON MIGUEL A. HUERTA MADISON JECHOW S. SHAWN JAMAIL JOHN H. KNOX OF COVNSEL MARCO MUNOZ" GEORGE E. DIBRELL 'Board Certified, Administrative Law Texas Board of Legal Specialization 'L~censed in Mexico only RE: Lease-Purchase Agreement, dated as of March 31, 1994, between ReCor, Inc. , _ ("Lessor") and the Kerr County Juvenile Board ("Lessee"). Dear Ms. Rogers: I have examined the Lease-Purchase Agreement, dated as of March 31, 1994, between the Lessee and Lessor (the "Lease"), the Deed of Trust, the Escrow Agreement, a Resolution - of the Kerr County Juvenile Board (the "Board"), an Order of the Kerr County Commissioners Court (the "Court"), a Resolution by the Lessor's board, the Interlocal Agreement, miscellaneous documents as enclosed and the proceedings taken by the Lessee to authorize and execute the Lease between ReCor, as Lessor, and the Board, as Lessee (hereinafter sometimes collectively referred to as the "Financing Documents"). Based upon an examination of state law and my reliance upon the Financing Documents and representations by officers and employees - of the Lessee, Lessor, the Court and the Texas Juvenile Probation Commission ("TJPC") and the opinions of the counsels for Lessee, I am of the opinion that: _ A. Authorization and Validity of Actions. (1) The Lessee is authorized and existing pursuant to state statute and is a duly ~~ created and validly existing political subdivision, agent thereof, unit, agency or governmental entity of the State of Texas authorized by the Constitution and laws of that state to enter into the transactions contemplated by the Lease and to carry out its obligations thereunder; Ms. JoAnne Rogers -2- October 11, 1994 (2) The Lease has been properly authorized, executed and delivered by Lessee pursuant to Constitutional and statutory provisions which authorize this transaction in accordance with its terms and conditions, and the Lease is a legal, valid and binding obligation on behalf of the Lessee, enforceable in accordance with its terms and conditions; (3) The signature of the official(s) which appear on the Lease are true and genuine and the individuals hold the office set forth below his/her name. (4) No approval, consent or withholding of objection is required from any governmental authority with respect to the entering into or performance by Lessee of the Lease or the transactions contemplated thereby, or if any such approval is required it has been obtained; (5) The entering into and performance of the Lease will not violate any judgment, order, law or regulation applicable to Lessee or result in any breach of, or _ constitute a default under, or result in the creation of any lien, charge, security interest or other encumbrance upon any assets of the Lessee or on the property _ subject to the Lease pursuant to any instrument to which the Lessee is a party or by which it or its assets may be bound; (6) There are no actions, suits or proceedings pending or, to our knowledge, threatened against or affecting Lessee in any court or before any governmental commission, board or authority which, if adversely determined, will have a _ material adverse effect on the ability of Lessee to perform its obligations under the Lease; (7) To the best of my knowledge, all representations made by Lessee in the Lease are true and accurate as of this date. (8) The Lease and the Financing Documents were authorized, approved and executed in conformance with the applicable laws and regulations of the State of Texas including the provisions requiring opportunity for competitive proposals. B. Tax Exemption. _ As to the validity and enforceability of the Lease against the Lessee, the present or future title to, and prior claims against, the land and the juvenile detention facility which comprise the security for the Lease, and with respect to factual matters that are relevant to a determination _ of the tax-exempt nature of the interest to be paid as part of the rental payments on the Lease, we have relied upon and assumed to be correct the opinion of Lessee's counsel, the above referenced documents, warranties and representations. Ms. JoAnne Rogers -3- October 11, 1994 Based upon the foregoing, we are of the opinion as of the date hereof and under existing -. law, as follows: (1) The rental payments pursuant to the Lease are payable solely from the payments -- to be made by the Lessee to Lessor from revenues and funds to be appropriated by Lessee, and from the security interests and the mortgage liens granted in the Financing Documents, and are not payable from any other source or funds of the - Lessee, or any other political subdivision of the State, or of the State save and except to the extent of appropriations from the State Legislature to the TJPC" that are transferred by the TJPC to local governmental entities contracting to place - juveniles in the Facility. A Mortgagee's title policy will be issued and the Lessor and Lessee have found the title and condition of the title to be acceptable for the intended use of the land and security pursuant to the Deed of Trust. (2) Except as discussed below, the interest portion of the rental payments on the Lease is excludable from the gross income of the owners for federal income tax _ purposes under the statutes, regulations, published rulings and court decisions existing on the date of this opinion. In expressing the aforementioned opinions, we have relied on, and assume compliance with certain representations and covenants regarding the use and investment of the proceeds of _ the Lease. We call your attention to the fact that failure to comply with such representations and covenants may cause the interest portion of the rental payments on the Lease to become includable in gross income retroactively to the date of the Lease. We call your attention to the fact that the interest on tax-exempt obligations, such as the Lease, is (a) included in a corporation's alternative minimum taxable income for purposes of determining the alternative minimum tax and the environmental tax imposed on corporations by sections 55 and 59A of the Code, (b) subject to the branch profits tax imposed on foreign corporations by section 884 of the Code, and (c) included in the passive investment income of - an S corporation and subject to the tax imposed by section 1375 of the Code. C. Qualifications and Limitations. The opinions expressed herein are subject to and limited by the following additional qualifications, assumptions, and exclusions: (1) Specified Laws. The opinion as to the enforceability of the Financing Documents is subject to the qualification that enforcement of such documents is limited by the following: Ms. JoAnne Rogers -4- October 11, 1994 (a) principles of equity which may limit the availability of certain equitable remedies; (b) bankruptcy, insolvency, reorganization, moratorium, and other similar laws of general application affecting the rights and remedies of parties to contracts in general; and (c) the legislative appropriation of funds to Lessee for its obligations pursuant to the Lease. _ 2. General Laws. The opinion as to the enforceability of the Lease is further subject to the qualification that the enforceability of certain of the remedial, waiver, and other provisions of the Lease may be limited or otherwise affected by certain `~ other applicable laws, which may impair the enforceability of certain remedial, waiver, and other provisions of the Lease; provided that, such additional laws will not, in our opinion, substantially interfere with the practical realization of the benefits of the Deed of Trust and Escrow Agreement, except for the consequences of procedural delays which may result therefrom. 3. General Assumptions. The opinions herein rendered are based upon the assumption that: (a) all documents submitted to us as originals are authentic, all documents submitted to us as copies are true and correct reproductions of the _ originals of such documents and all documents have been submitted to us; (b) all individuals executing the Financing Documents are sui juris. _ 4. Financial Ability. No opinion is given or expressed, nor should any opinion be inferred or implied, as to the financial, physical, or business ability of Lessee or any other party to meet or satisfy the obligations under the Financing Documents. D. Scone and General Statements. This Opinion is being provided to you for the purpose of consummating the transactions evidenced by the Financing Documents, and, without prior written consent, it may not be relied upon, used, circulated, quoted, or otherwise referred to, in any manner by any person, firm, governmental authority, or entity whatsoever, other than reliance thereon by the Lessor solely for the purpose of consummating the transactions evidenced by the Financing Documents. Ms. JoAnne Rogers -5- October 11, 1994 This Opinion is rendered as of the date hereof, and I undertake no, and hereby disclaim any, obligation to advise you of any changes or any new developments which might affect any matters or opinions set forth herein. - We have not been requested to investigate or verify and have not independently investigated or verified any records, data or other material relating to the financial condition or capabilities of the Lessee, the State, the County or the Board and have not assumed any °' responsibility with respect thereto. Except as otherwise expressly set forth herein, our opinions are limited in all respects to the laws of the State of Texas and the federal law of the United States, and we assume no responsibility as to the applicability thereto or the affect thereon of the laws of any other jurisdictions. Very truly yours, Bickerstaff, Heath & Smiley, L.L.P. ~--- ~~~ By: Barney L. Knight, Partner t'3 FILING OFFICE COPY -UCC-21 •~ ;~wrih Bata i anri 1. p~btor 2. Secured Part' 3. For Filing Officer - Recor, Inc. ChiCorp Fin. Serv. , In ~~ 27tY~~ Oct. ~i,94 5912 Balcones Dr. 208 South LaSalle St. PArf;icuDtE Suite 250 b~r.~ ~ ` Austin, Tx. 78731 Ch:;.cago, IL 60604 ~,~, ~ ~ ~,~ }~ e & Kerr Cnty. Juv. Brd. 39.00 + 5.00 + 1.00 624 Jefferson Assignee Nonstandard Form #13579 L 0771 PaGEO47 ~Y O - See Oversize File No. ~ Cross Reference. See: Filed by: Fidelity Abstract 2:30 P.M: - Return to: Bickerstaff, Heath & Smiley, LLP 98 San Jacinto Blvd., Suite 1800 Austin, T x. 78701-4039 Attn: Barney L. Knight STANDARD FORM UCC-Z1 -Approved by the Secretary of State of Texas - 11) FiLif\?G OFFiCt~ CtaPY STANDARD FORM-FORM UCC-Z 1'APPROVED BY SECRETART OF STATE OF TE %AS~FOR SALE 8Y ROYER & SCNl1TT5 COMMERCIAL PRINTING DIYISION FINANCING STATEMENT von 077 Pacf04~ - [TO BE FILED WITH COUNTY CLERK'S OFFICE) This Financing Statement is presented to a Filing Officer for filing pursuant to the Uniform Commercial Code. 1. Debtor's Name and mailing address: - ReCor, Inc. 5912 Balcones Dr. Suite 250 - Austin, Texas 78731 Kerr County Juvenile Board, as agent for Kerr County, Texas -' 624 Jefferson Kerrville, Texas 78028 2. Secured Party's name and mailing address: ChiCorp Financial Services, Inc. 208 South LaSalle Street Chicago, Illinois 60604 3. This Financing Statement covers the following types or items -- of property ("Collateral"): All furnishings, fixtures, equipment, systems, machinery _ and items of personal property, including all renewals, replacements, substitutions and additions to or therefor, now or hereafter placed upon that certain 18 acres more or less in the City of Kerrville, Kerr County, Texas, as - said land is more particularly described in a "Deed of Trust Including Security Agreement and Financing Statements" dated of even date herewith, to be filed of - record with the County Clerk of Kerr County, Texas, and in the Real Property Records of Kerr County, Texas, upon and against the real property described in "Exhibit A" - attached hereto and incorporated hereon for all purposes. The above goods are or are to become fixtures on the above-referenced property located at 3401 Legion Drive, Kerrville, Texas. This security interest does not attach _ to those items referred to that have been specifically purchased by funds of the Kerr County Juvenile Board and which are not renewals, replacements or substitutions. Kerr County Juvenile Facility Financing Statement 1 ~VOL 071 PHGEO~3:J DEBTORS' SIGNATIIRE: RECOR, INC. ' • G e Heckmann President KERB COUNTY JUVENILE BOARD, - as agent for Kerr County, Texas _ By William G. Stac Chairman of the Board SECIIRED PARTY'S SIGNATIIRE: - CHICORP FINANCIAL SERVICES, INC. _ By: JoAnne Rogers Vice President FOR FILING OFFICER ONLY: - Return file-marked copy of original to: Bickerstaff, Heath & Smiley, L.L.P. 98 San Jacinto Blvd., Suite 1800 _ Austin, Texas 78701-4039 Attention: Barney L. Knight _ ~ic4li~y ~-~~-t-ru~t ~-f~~~Et ~ 2ti ~cfk-~ 7 s~r~- RECORDEF!'S NOTE AT TIME OF f~CC~iDAT10N INSTR!!~.'fElr'T fD TO 8E IIcQiJA1E F{~ ~•L'i' P'ri.'~TOGRP,F'N1C REPROI~IICTIOhI Dt!E TG DEP'iN ~ DAr'tKt~s:SS 4P PRh'T, CQ~ OF FRIIVT QR !"!K, BACKGRQtS~Ha ~ PAPER, i41JEG181tlTY, CARBON OR PHOTO COPY, EtC. - Kerr County Juvenile Facility Financing Statement 2 EXHIBIT "A" ~VOL 071 PAGEO~O PROPERTY: Lot 1, Block 1, and Lot 1, Block 2, Final Plat of RECOR SUBDIVISION, a subdivision according to map or plat recorded in Volume ~ 6 , Pages 212 of the Plat Records of Kerr County, Texas. EXCEPTIONS: 1. Taxes for 1994 and subsequent years. 2. Easement from the City of Kerrville to Lone Star Gas Company, recorded Volume 1, Page 402 of the Easement Records of Kerr County, Texas. - 3. Easement from the City of Kerrville to Lone Star Gas Company recorded in Volume 5, Page 21 of the Easement. Records of Kerr County, Texas. 4. Easement recorded in Volume 2, Page 26 of the Easement Records of Kerr County, Texas, from Julia Elizabeth Nye to Lone Star Gas Company. 5. Easement from R. Peschell, et ux to Texas Public Utilities Co., recorded in Volume 46, Page 388 of the - Deed Records of Kerr County, Texas. 6. Easement from Rudolph Peschell, et ux to the Texas Power _ & Light Company recorded in Volume 46, Page 627 of the Deed Records of Kerr County, Texas. 7. Easement from P. J. Kelly, et ux to Texas Power & Light Company recorded in Volume 54, Page 241 of the Deed Records of Kerr County, Texas. -- 8. Easement to LCRA recorded in Volume 76, Page 356 of the Deed Records of Kerr County, Texas. _ 9. Easement from the City of Kerrville to L.C.R.A. recorded in Volume 2, Page 564 of the Easement Records of Kerr County, Texas. - 10. Easements granted to the City of Kerrville in Deed recorded in Volume 180, Page 402 of the Deed Records of Kerr County, Texas. 11. All matters shown on the Final Plat of RECOR SUBDIVISION, recorded or to be recorded in the Plat Records of Kerr County, Texas. 9\1087.095\Exa EXHIBIT "A"- 1 ~~~ 0771 ~~~f0~1 CONTINUATION - FINANCING STATEMENT 1;SS`79 TERMINATION ReCor, Inc. PAPERS ENCLOSED: - - Financ(ng Statement 10 - 2 7 - ~ 4 2 : 3 0 P : M . , - Amendment Ass(gnment - Release of Collateral Continuation - Termination REAL ESTATE RECORDS - ReCor, Inc. 5912 Balcones Dr., Suite 250 ~ Austin, Tx. ?8731 - ", Kerr County Juvenile Soard , 624 Jefferson ' ~ , Kerrville, Tx. X7$028 .' l- , - ~+ ~ 4 - t .e ' - ~ '' TO , 1`. ~ - ChiCorp~'FinaricYal 'Serve , "Inc 4 :~~s ~',~... 208 South LaSalle St. =', ~ "~~~.=`~~=;-'- _ Chicago, IL 60604 Filed by: Fidelity Abstract -'- Return to: Bickerstaff, Heath & Smiley - 98 San Jacinto Blvd. Suite 1800 Austin, Tx.' 78701-4039 - 27t~, ~~ 94 0 ~, ~ sfipoRD R~~e rte' VOS. ~ 7 ~ PG 7 pECOR01td(i DAi~ OCT 2`~ X994 ~.~~ (~a~.~ ~ G~`' ~~ ~ •+'~ oourm a.ERK ~R c~ouMY arov~an neren wrocn reatrxxtae sa~e.rentai auteotthedoeaboCpraplrly oocwaaooiorarea~wwelld~eu~enta~leunde~~eOi~Nla+l ~~y~~~ dao~ Ittheitnrta~»PeoAereonb~ynw~a~a~i~e~E00R0E0M'>~ O~idalPDppCRecaOSat~taooenwatKe~-(k~. e~ufon 4CT 27 1994 a ~~ ~ ~~ ~+ COUPRYCIERK.i~RRCOt! ~7'~XAS FiIM- PATR~IA DYE a~ ~ n ~~2 ~R ~~r. rw. ~' !~ ~ iii,.... ~"`_ .r...~ o~o.~r N~~x~' ;~ 39.00 + 5.00 .+ 1.00 G~~r L` NO ARBITRAGE CERTIFICATE 1. In General. - 1.1. The undersigned is the duly appointed Chief Juvenile Officer of the Kerr County Juvenile Board, an agent for Kerr County, Texas ("Issuer"). - 1.2. This certificate is executed for the purpose of establishing the reasonable expectations of the Issuer as to future events regarding the Lease Purchase Agreement (the - "Lease") being delivered as of the date of this certificate. The Issuer has not been notified of any listing or proposed listing of the Issuer by the Internal Revenue Service as an issuer that may not certify its obligations. 1.3. To the best of the undersigned~s knowledge, information and belief , the expectations contained in this certificate are - reasonable. 1.4. The undersigned is an officer of the Issuer delegated - with the responsibility of issuing and delivering the Lease. 1.5. The Lease is being entered into pursuant to an Order of the Kerr County Commissioners Court and a Resolution -' ("Resolution") of the Issuer. Capitalized terms not otherwise defined herein shall have the same meanings ascribed to them in the Lease unless the context in which they appear requires - otherwise. 2. The Purpose of the Lease. 2.1. The Lease is being entered into for the purpose of acquiring a facility in Kerr County. - 2.2. The Lease will be payable from the appropriation of rental payments from the Texas Juvenile Probation Commission, as appropriated by the Texas Legislature, and Kerr County, ..._ Texas to the Issuer. 2.3 The proceeds of the Lease are not expected to exceed the amounts necessary for the governmental purpose of the Lease. 3. Source and Disbursement of Funds. - 3.1. Pursuant to the Lease, ReCor, Inc., as Lessor, has assigned its interest in the Lease to ChiCorp Financial Services, Inc. ("CFSI") as the Assignee, and CFSI has gross _ funded the Lease in the principal amount of $2,962,000.00. 3.2. The $2,962,000.00 of net proceeds of the Lease will be _ applied: to deposit $2,962,000.00 in the Acquisition Fund with $2,666,318.50 of such amount being used to pay the costs of the land, development, legal and financing expenses; $83,896.47 as a Rental Deposit; and $211,785.00 as capitalized .- interest for payment of interest during the construction of the Facility. 4. Temporary Period. 4.1. The Issuer has incurred, or reasonably expects to incur within six months after the issuance of the Notes, a - substantial binding obligation to commence acquisition and construction of the Improvements, pursuant to which the Issuer is or will be oblig to expend at least $100,000.00. - ec~ec~ -Fob ~ ~ w ~ ~-h ~ h PI'S ~1 g 4.2 . Construction i ~~~-~-^.,*' ~• • ~'^Y ~°~ •, and the undersigned reasonably expects that such construction will proceed with due diligence to completion. 4.3. All amounts in the 1994 Acqusition Fund, including all investment earnings, will be expended either for the - Improvements or, if and when found not to be required for such expenditure, will be used to pay Rental Payments within three years after the date of this certificate. 5. Anticipated Completion Period. 5.1 The Issuer reasonably anticipates that all of the - spendable proceeds of the Lease will be expended on the Land and the Improvements and related expenses within eighteen months from the date of execution of the Lease. 5.2 The Issuer reasonably anticipates that the following schedule for expenditures of the available construction proceeds for the construction of the facility will take place - within the following time periods: a. 15~ within the first six months; - b. 60$ within 1 year of the date the Lease is executed; and c. 100$ within 18 months of the date the Lease is - executed. 6. Acquisition Fund -- Capitalized Interest. 6.1. Money deposited in the Acquisition Fund by the Issuer for the Lease as capitalized interest will be used to pay the interest on the Lease during construction of the Facility and the Issuer reasonably expects that there will be no other funds that will be so used. kunoarL.bllc Page 2 7. Other Obligations. There are no other obligations of the Issuer which (a) are issued at substantially the same time as the Lease (i.e., within 31 days hereof) , (b) are sold pursuant to a common plan _ of financing with the Lease, and (c) will be paid out of the same source and have substantially the same claim to be paid out of substantially the same source of funds as the Lease. - 8. Rebate to United States. The Issuer has covenanted in the Lease that it will comply _ with the requirements of the Code, which includes section 148(f) of the Code, relating to the required rebate steps to ensure that all earnings on gross proceeds of the Lease in excess of the yield on the Lease required to be rebated to the United States will be timely paid to the United States. T ~ -` DATED: ~, 1994 kcmoaCL.blk KERB COUNTY JUVENILE BOARD By : ~. ~~ Simon J. Harris Chief Juvenile Officer Pege 3 ~ ~/ ~, v ~( i~nf r ~ Return r x v-E7i'e t GoV~'nm .. i s ions F«m $~~B-G a mat~.,rt fo tat Obi g t _ (Rev. October 1989) - t7nder Section 149(e) OepaRment of the Treasury - See separate Instructions Internal Revenue Service (Use Form 8038-GC if the issue price is under ~ 100,000) ~ 9 10 11 12 13 14 15 16 17 ` 18 y ., OMS No. 1545-0720 Expires 5-31-92 tf-,~tl Reoortine Autfiarity Check box if Amended Return - n 1 Issuer's name 2 Issuer's employer identification number Iterr~Cotlnty Juvenile Board, as agent for Kerr Coup 74-6001494 3 Number and street 4 Repoli number 624 Jefferson G19 94 - 1 5 Ciry or town, state, and Z1P code 6 Oate of issue Kerrville, TX= 78028 ~ 3 31 4 7 Name of Issue 8 Cl1SIP (Humber rerr County Juvenile Detention Facili Lease l'urclase ~ -N A ;jj Type of Issue (check box(es) that applies and enter the Issue Price) Check box if obligations are tax or other revenue anticipation bo ^ Check box if obligations are in the form of a lease or i ~m€nt ^ Education E` ~~t ~ ~ Q Health and hospital : ~~~~, ~ .. ~~.i~~. Transportation ~_ ` i •''' ~~ ~` j ^ Public safety ~:', ~-~~ ~`,~ ~~~~~. ~, ~ . REG ^E t'dd' bod ~~~ issue price . ,~r~ . •',`I . nwronmen (In u Ing sewage n s) ~ ~ f ^ Housing := '. %~ ~ . `~ . ~ ~ . ^ Utilities ;;`'~ -~~~~ ~ :~ .1. ^ Other. Describe (see Instruction) - _ _ Deserintian of (°) ~) (c) < (e) Stafed redemption wcrghted (0 (rd Net interest Maturity date Interest rate Issue price rice at mat avers ma Yreld cast 19 Final maturity N A N A 96 N .lA N/A 20 Entire issue . , 962, 000.00 I A 15 ears 96 4.663 ~ r Uses of Ori final Proceeds of Bond Issues inUUdin underwriters' ascount 22 Proceeds used foraccrued interest 21 N A 22 issue price of entire issue (enter tine 20c) . .. i . ~ ~ ~ . 2Z N A 23 23 N A Proceeds used for bond issuance costs (including underwriters' discount) . 24 Proceeds used for credit enhancement . 24 N A 25 Proceeds allocated to reasonably required reserve or replacement fund 25 N A 26 Proceeds used to refund prior issues . 26 N/A 27 Total (add lines 23, 24, 25, and 26) . _ ,! 27 N A 28 Nonrefundin roceeds of the issue subtract line 27 from line 22 and enter amount here 28 N A Oescri tion of Refunded Bonds com lete this art onl for refundin bonds) 29 Enter the remaining weighted average maturity of the bonds to be refunded - N/A years 30 Enter the last date on which the refunded bonds will be called . - N/A 31 Enter the datefs the refunded bonds were issued 1 N A Miscellaneous __ 32 Enter the amount of the state volume cap allocated to the issue ~ . - N/A 33 Enter the amount of the bonds designated by the issuer under section 265(bx3xBKx111) (small $2, 962, 000.00 issuer exception) - 34 Pooled financings: I N/A a Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental units - b Check box if this issue is a loan made from the proceeds ofanothertax-exempt issue - ^ and enter the name of the issuer - and the date of the issue - Under penaibes of perjury, 1 declare that I trove examined this return and accomparrying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Please ~ ~G~ Sign Here ~,~~~ ` ~ WiJ.liaTii G. Stacy, Chairman o , Signature of officer Date Type or print name a nd title ~~ ]30ard For Paperwork Reduction Act Notice, see page 1 of the Instructions. Form 8038-G (Rev. to-a9> 15/90 Pub:ished by Tax Management Inc.. a Subsidiary of The Bureau of National Affairs, Inc. 8U38-G.1 125 ~0 Bickerstaff, Heath & Smiley, L.L.P. A REGISTERED LIMITED LIABILITY PARTNERSHIP STEVE BICKERSTAFF C. ROBERT HEATH' MARTHAE SMILEV THOMAS M POLLAN' ANN CLARKE SNELL ANDREW KEVER' CAROLVN E. SHELLMAN DOVGLAS G. CAROOM• LINDA AAKER M V RA A. McDANIEL SVSAN C. GENTZ ROBIN A. CASEY KATIE BONG MANUEL O. MENDEZ' SYDNEY W. FALK, JR. DAVID MENDEZ' CATHERINE BROWN FRYER' PATRICIA E. RANT J GREG HUDSON WILLIAM D. DUCAT III JESUS SIFUENTES DEBORAH HERZBERG I OOMIS BARNEY L. KNIGHT LYNN RAV SH ERMAN MARCO L. FRASIER KEVIN W. COLE MICHAEL SHAUNESSY VALERIE P KIRK J. STEPHEN RAVEL GILBERT J. BERNAL. JR. DIANA L. NICHULS CHRIS VON DOHLEN ERIC H. DRUMMOND SARA HARDNER LEON MIGUEL A HUERTA MADISON JEC;HOW S. SHAWN JAMAIL JOHN FI. KNOX SAN JAGINTO CENTER, SUITE 1800 98 SAN JACINTO BOULEVARD AUSTIN. TEXAS 78701-4039 512472E021 FAX. 512,320-5638 November 17, 1994 OF COUNSEL MARCO MUNOZ" GEORGE E. DIBRELL 'Board Certified, Administrative Lew- Tezas Boerd of Lepel Spacializatgn 'Licensed in Mexru ony 'jt., / Ms. Ilse D. Bailey Assistant County Attorney N~~ 2 ~ }99~ County Courthouse, Suite B20 700 East Main Street ~ __ ~~~~ Kerrville, Texas 78028-5324 RE: Lease-Purchase Agreement dated as of March 31, 1994, between the Kerr County Juvenile Board, as Agent for Kerr County, Texas as Lessee, and ReCor, Inc., as Lessor Dear Ms. Bailey: Pursuant to my phone conversation with you yesterday, enclosed are five (5) original Incumbency Certificates regarding the above- referenced Juvenile Facility. Please obtain the signatures of the County Judge, Judge Prohl, County Auditor and County Clerk and forward these to our office at your earliest convenience. Keep one original for your files. If you have any questions, please do not hesitate to call. Sincerely, ~~~~ Beth Myers Legal Assistant Knight to Barney L. :bsm Enclosures Bickerstaff, Heath & Smiley, L.L.P. A REGISTERED LIMITED LIABILITY PARTNERSHIP SAN JACINTO CENTER, SUITE 1800 98 SAN JACINTO BOULEVARD AUSTIN, TEXAS 78701-4039 512.472-8021 FAX. 5121320-5638 November 9, 1994 Ms. Ilse D. Bailey Assistant County Attorney County Courthouse, Suite B20 700 East Main Street Kerrville, TX 78028-5324 STEVE BICKERSTAFF C. ROBERT HEATH' MARTHA E SMILEY THOMAS M. POLLAN' ANN CLARKF SNELL ANDREW KEVER' CAROLVN E SHELLMAN DOVGLAS G. CAROOM' LINDA AAKER MVRA A. Mc DANIEL SUSAN C. GENTZ ROBIN A. CASEY KATIE BOND MANUEL O. MENDEZ' SYDNEY W. FALK, JR. DAVID MENOEZ' CATHERINE BROWN FRYER' PATRICIA E. RANT J. GREG HUDSON WILLIAM D. DUGAT III JESUS SIFUENTES DEBORAH HERZBERG LOOMIS BARNEV L KNIGHT LYNN RAV SHERMAN MARGO L. FRASIER KEVIN W COLE MICHAEL SNAUNESSV VALERIE P KIRK J STEPHEN RAVEL GILBERT J. BERNAL JR DIANA L NICHOLS CHRIS VON DOHLEN ERIC H. DRUMMOND SARA HARDNER LEON MIGUEL A. HUERTA MADISON JECHOW S. SHAWN JAMAIL JOHN H. KNOX OF COUNSEL MARCO MUIVOZ" GEORGE E. DIBRELL 'Board Certified, Administrative Law- TexaS Board of Legal SpeclallZatron 'Licensed In Mexico only Lvov i o RE: Kerr County Juvenile Board Lease-Ptirc ase o a Juvenile Detention Facility Dear Ilse: Enclosed is an original transcript of the proceedings for the above-referenced facility. Upon receipt of the policy we will forward a copy to your office. Please note that, although title to the land had been cleared, the title company in Kerrville had given a binding commitment for the Mortgagee's Title Policy, the premium for that policy had been paid, and the project funded, the title company has refused to issue the Mortgagee's Title Policy. As a result, we have now demanded a return of the premium and requested Stewart Title Guaranty Company to issue the Mortgagee's Title Policy. Also, when the Commissioners Court has executed the Order approving the First Amendment to the Escrow Agreement, which was forwarded to you on October 20, 1994, please keep one for your files and forward the remaining orders to our office. If you have any questions, please do not hesitate to call. Sincerely, • ~~~ Barney L . Knight J ~'-`r'~~. BLK:bsm Enclosure STATE OF TEXAS § KERB COUNTY § INCUMBENCY CERTIFICATE I, Patricia Dye, County Clerk, Ex-Officio Clerk of the Kerr County Commissioners Court and the Kerr County Juvenile Board, do hereby certify that I have access to and shared authority and control over the records of such entity, and that as of the date hereof, the individuals named below are the duly elected or appointed officers of such entity holding the offices set forth opposite their respective names. I further certify that (i) the signatures set opposite their respective names and titles are their true and authentic signatures, and (ii) such officers have the authority on behalf of such entity to enter into that certain Lease dated as of March 31, 1994 between such entity and ReCor, Inc. NAME Robert A. Denson County Judge Emil Karl Prohl Judge, 198th Judicial District Tommy Tomlinson TITLE SIGNATURE Chairman of the Board Board Member County Auditor Kerr County IN WITNESS WHEREOF, I have duly executed this certificate and affixed the seal of such entity hereto this _~n+r day of November, 1994. By: '~ ,l _ _ Name: Patricia Dye ~` Title: County Clerk, Ex-Officio Clerk of the Kerr County Commissioners Court .5 ' ~s~AiY f -; ~~ ,- S '~ r .r~~ CERTIFICATION OF TUVENILE DETENTION FACILITY BE IT REMEMBERED that on therJ"T~ day of ~~P-ril~e~- , 1995, the members of the Kerr County Juvenile Board have certified the Recor-Kerrville Juvenile Detention Facility, located in Kerrville, Ken County, Texas, as suitable for the detention of children in accordance with the Texas Family Code, Section 51.12. U R ERT A. D ON, Ken County Judge Chairman of the Juvenile Board EMIL KARL PROHL, 198th District Judge Member of the Juvenile Board h e2~ N B. ABLES, 216th District Judge of the Juvenile Board ~ Daroi ~~GGAn. t4 9~ PATRICI YE C Co , Tw3 ~' Ocpab