16-R-81 - Agreement with AUC Group for lease of pre-packaged Sewer Treatment plant1 .111 =0 110 1 U11990TIOnn N10 ".1
NOW THEREFORE, WHEREAS, the City of Schertz has an executed agreement with
the developers of the CrossVine development to provide waste water treatment capacity; and
WHEREAS, the City of Schertz and it's waste water treatment partner, Cibolo Creek
Municipal Authority have determined that the current treatment plant is approaching its
maximum treatment capacity; and
WHEREAS, A.U.C. Group LP has a pre - packaged sewer treatment plant available for
lease that will double the capacity of the current plant; and
WHEREAS, the total cost of the project is estimated to be $511,700.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS
THAT:
Section 1. The City Council hereby authorizes the City Manager to enter into the
lease agreement attached in Exhibit A.
Section 2. The recitals contained in the preamble hereof are hereby found to be true,
and such recitals are hereby made a part of this Resolution for all purposes and are adopted as a
part of the judgment and findings of the City Council.
Section 3. All resolutions, or parts thereof, which are in conflict or inconsistent with
any provision of this Resolution are hereby repealed to the extent of such conflict, and the
provisions of this Resolution shall be and remain controlling as to the matters resolved herein.
Section 4. This Resolution shall be construed and enforced in accordance with the
laws of the State of Texas and the United States of America.
Section 5. If any provision of this Resolution or the application thereof to any person
or circumstance shall be held to be invalid, the remainder of this Resolution and the application
of such provision to other persons and circumstances shall nevertheless be valid, and the City
Council hereby declares that this Resolution would have been enacted without such invalid
provision.
Section 6. It is officially found, determined, and declared that the meeting at which
this Resolution is adopted was open to the public and public notice of the time, place, and subject
matter of the public business to be considered at such meeting, including this Resolution, was
given, all as required by Chapter 551, Texas Government Code, as amended.
Section 7. This Resolution shall be in force and effect from and after its final
passage, and it is so resolved.
lo 11111
ATTEST:
OW'Secretairy, Brenda Dennis
(CITY SEAL)
CITY OF SCHERTZ, TEXAS
41 e111
Mayor, Michael R. Carpenter
■ ,: o, ' W6
50448599.1 A -1
City of Sc hertz
EQUIPMENT LEASE
FOR
42,000 GPD EXPANSION
OF THE
INTERIM WASTEWATER TREATMENT PLANT
Au ust 22016
AUC Group, L. P.
Page 1 of 13
This Equipment Lease Agreement ("Lease Agreement") made this day of Jul�j
Subject to the terms and conditions in this Lease Agreement, Lessor hereby leases
deliver
Lessor will ' • Property to Lessee at an acceptable 4 • site for which
further Without demand • by Lessor, Lessee shall pay to Lessor
.s! iii !'t -•� • ^• �,�r • - -
is due and payable to Lessor immediately upon substantial completion of the installation of
the Leased Property.
SECTION 3 - TERMS
Unless Lessor terminates this Lease Agreement pursuant to the provisions of
Section 14 of this Agreement, this Agreement will remain in effect for twenty -four (24)
months commencing on the first day of the month following the substantial completion of
the installation of the Leased Property. However, this Lease Agreement will automatically
be extended and will continue under the same terms and conditions of this Lease
Agreement for successive ninety (90) day periods after the initial term until such a time as
Lessee gives Lessor eighty (80) days written notice of its intent to cancel and terminate this
Lease Agreement.
SECTION 4 RENTAL PAYMENTS
Lessee agrees to pay Lessor as rental for the use of the Leased Property
$10,400.00 per month for each of the twenty -four (24) months comprising the the initial term
of this Agreement. Each of the monthly Lease Payments are due and payable to Lessor on
the first (1 st) day of each month, in advance, and Lessor will make these payments at the
office of Lessor in Houston, Texas. Lessee will pay the first and last month's rent upon the
execution of this Lease Agreement by both parties. After that 24 month period, the monthly
Lease Payment will be $8500.00.
SECTION 5 - TITLE TO LEASED PROPERTY
The Leased Property will at all times be and remain the sole and exclusive property
of Lessor, and Lessee will not have any right to the Leased Property, but will have only the
right to use the Leased Property upon the terms and conditions contained in this Lease
Agreement. The Parties expressly agree that the Leased Property is and will remain
personal property even though it may be attached or affixed to real estate. If the Leased
Property is attached or affixed to real estate that a person or entity other than Lessee owns
Page 3 of 13
or that is subject to a mortgage, then Lessee will obtain and deliver to Lessor a consent and
waiver from the Landlord or Mortgagee, as the case may be, in a form acceptable to Lessor
that will permit Lessor to remove the Leased Property from the real estate at any time
during the term of, or after the expiration of, this Lease Agreement. Lessor may display
notice of its ownership of the Leased Property by affixing to each item of equipment an
identifying stencil or plate or other indication of ownership, and Lessee agrees that it will not
remove, deface, or obliterate any such notice.
SECTION 6 - LESSOR'S WARRANTIES
The Lessor covenants and agrees as follows:
a) The Lessor has, or will have by the Installation Date, clear and good title to the
Leased Property, free and clear of all liens and encumbrances, excepting only
the lien for current taxes not yet due and the lien or liens securing only the
purchase money mortgage of the equipment or financing secured by this Lease
Agreement.
b) The Leased Property equals or exceeds the current TCEQ Design Criteria as
specified in Section 1 and is in good and serviceable condition.
c) The Lessor will undertake any reasonable action that Lessee requests to enforce
any and all warranties or guarantees to which Lessor is entitled on the
equipment, or assign such warranties or guarantees to Lessee.
d) Lessee agrees that Lessor will not be liable to Lessee for any liability, claim,
loss, damage, or expense of any kind or nature caused directly or indirectly, by
the Leased Property or any inadequacy of the Lease Property for any purpose,
or any deficiency or defect in the Lease Property, or the use of maintenance of
the Leased Property, or any repairs, servicing, or adjustments to the Lease
Property, or any interruption or loss of service or use of the Leased Property, or
any loss of business, or any damage whatsoever and howsoever caused, unless
caused by Lessor or is a deficiency, defect, or inadequacy that occurs within 180
days after the Installation Date and that is not caused by Lessee or a third party.
Page 4 of 13
The provisions of this subsection d) will not apply to any liability, claim, loss,
damage, or expense caused by an event of default by Lessor as defined in
Section 14.
SECTION 7 - REMOVAL INSPECTION AND RETURN
Lessee will not remove the Leased Property the place of its initial installation without
the prior written consent of Lessor. Lessee will at all reasonable times and from time -to-
time allow Lessor, by or through any of its officers, agents, or attorneys, to examine and
inspect the Leased Property. Upon the termination of this Lease Agreement, Lessor will, at
its expense, remove the Leased Property from the site, and will have ninety (90) days from
the date that Lessee gives notice to Lessor that the Leased Property is no longer in service
to effectuate that removal. Lessee will be responsible for dewatering the Leased Property
and will deliver it to Lessor in a clean condition.
SECTION 8 - OPERATION MAINTENANCE AND REPAIR
Lessee will comply with and conform to all applicable municipal, state, and federal
laws relating to the operation of the Leased Property. Lessee will maintain the Leased
Property in good condition and running order at all times during the term of this Lease
Agreement, but will not be responsible for normal wear and tear or depreciation. Lessee
will purchase all additions, attachments, accessories, and repair parts at any time placed in
or on the Leased Property from Lessor or are equal quality of those Lessor originally
installed, and those additions, attachments, etc. will become a part of the Leased Property
and will be the property of the Lessor. Lessor will not have any responsibility for the
maintenance of the Leased Property after it is delivered to and accepted by Lessee and
before it is redelivered to Lessor as provided in this Agreement.
SECTION 9 - RISK OF LOSS AND INSURANCE
Lesse will bear all risk of loss or damage of the Leased Property Lessee will have
and maintain insurance at all times with respect to the Leased Property against risks of fire
Page 5 of 13
• r -r r -r r- .r- - r, •, a r r
as Lessor may reasonably -r -• - such insurance proceeds tr be payable to Lessor.
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FOR WILL CONTINUE WITH FULL FORCE AND EFFECT REGARDLESS OF THE
TERMINATION OF THIS LEASE WHETHER BY EXPIRATION OF TIME,
BY OPERATION OR OTHERWISE.
and interest to the equipment and the Lease Payments, free of any right of first refusal of
Lessee under this Agreement. Regardless of any contrary provision in this Agreement: (i) if
Lessee elects not to exercise this right of first refusal but Lessor fails to consummate the
sale to the offering party and /or (ii) if Lessor sells only a portion of Lessor's right, title, and
interest to the equipment and the Lease Payments, then Lessor shall re -offer any unsold
portion of Lessor's right, title, and interest to the equipment and the Lease Payments to
Lessee under all of the same rights as set forth in this Section 13 in each subsequent
transaction thereafter.
If Lessor makes an assignment its right, title, and interest to the equipment and the
Lease Payments after Lessee elects not the exercise its right of first refusal, the assignee
will thereupon acquire all of the rights and remedies possessed by or available to the
Lessor. Upon receiving proper notice of any such assignment, the Lessee will thereafter
make Lease Payments as in directed in that notice.
SECTION 14 - EVENTS OF DEFAULT
The following events will be deemed to be events of default by the Lessee under this
Lease Agreement:
a) Lessee fails to pay any Lease Payments during initial term and that failure
continues for a period of thirty (30) days after Lessee's receipt of written notice
from Lessor of lack of receipt of a Lease Payment.
b) Lessee fails to comply with any other term, provision, or covenant of this Lease
Agreement and does not cure that failure within thirty (30) days after Lesee's
receipt of written notice of the specific failures to comply from Lessor.
Upon the occurrence of any such events of default, Lessor will have the right to
declare the balance of the rental payable under this Lease Agreement to be due and
payable whereupon the that amount will become immediately due and payable, and Lessor
will have the right to retake and retain the Leased Property should the Lessee fail to make
payment of the outstanding balance within ten (10) business days of written notice of such
default delivered to Lessee by certified mail. If Lessor retakes the Leased Property under
Page 8 of 13
Except as otherwise provided in this Lease Agreement, each provision of this
address as Lessor may specify from time • time by written notice delivered to
b) Any notice or document required or permitted to be delivered under this
Agreement, except for the notice of payment required pursuant to this Section 5,
will be deemed to be delivered upon actual receipt by the Parties at the
respective addresses set out opposite their names below, or at such other
address as they have previously specified by written notice delivered in
accordance with this Section 15.
LESSEE City of Schertz
1400 Schertz Parkway
Schertz, Texas 78154
SECTION 16- INTERPRETATION
LESSOR AUC Group, L. P.
1800 Augusta, Suite 108
Houston, Texas 77057
Words of any gender used in this Lease Agreement will be held and construed to
include any other gender, and words in the singular number will be held to include the
plural, and vice versa, unless the context otherwise requires.
SECTION 17 — BINDING EFFECT
The terms, provisions, covenants and conditions contained in this Lease Agreement
will apply to, insure to the benefit of, and be binding upon the Parties and upon their
respective heirs, legal representatives, successors, and permitted assigns except as
otherwise expressly provided.
SECTION 18 — ENTIRE AGREEMENT AND AMENDMENTS
This instrument contains the entire agreement between the Parties. This Lease
Agreement may not be amended, altered, or changes except by an instrument in writing
signed by both Parties.
Page 10 of 13
SECTION 19 - TAXES / BENEFICIAL OWNERSHIP
While this Lease Agreement is in effect, any taxes that any taxing authority imposes
or levies on the Leased Property will be the responsibility of the Lessee. While this
Agreement is in effect the Lessee will be considered the beneficial Owner of the Leased
Property.
SECTION 20 - FORCE MAJEURE
(a) Definition. "Force Majeure" means and refers to acts of God; strikes, lockouts, or
other industrial disturbances; acts of public enemies; orders of any kind of the government
of the United States, the State of Texas, or any civil or military authority; the failure of the
government of the United States, the State of Texas, or any civil or military authority to act
upon a party's request; insurrections; riots; epidemics; landslides; lightning, earthquakes;
fires; hurricanes; storms; floods; washouts; droughts; arrests; restraint of government and
people; civil disturbances; explosions; accidents causing breakage of machinery, pipelines,
pumps, or other facilities; partial or entire failure of necessary utilities; or any other cause
not reasonably within the control of the party claiming such inability.
(b) Invocation. If, by reason of Force Majeure, any party will be rendered wholly or
partially unable to carry out its obligations under this Contract, then that party will give
written notice of the full particulars of such Force Majeure to the other party within a
reasonable time after its occurrence. The obligations of the party giving such notice, to the
extent affected by such Force Majeure, will be suspended during the continuance of the
inability claimed and for no longer period, and that party will in good faith use its best efforts
to remove or overcome such inability with all reasonable dispatch.
(c) Settlement of Strikes and Lockouts. The settlement of strikes and lockouts will be
entirely within the discretion of the party having the difficulty, and the above requirement
that any Force Majeure will be remedied with all reasonable dispatch will not require
settlement of strikes and lockouts by acceding to demands of the opposing party when such
settlement is unfavorable to it in the judgment of the party having the difficulty.
Page 11 of 13
EXECUTED this _ day of August, 2016.
By: AUC Management, L.L.C.
a Texas Limited Liability Company
its Sole General Partner
Todd Mueller, President
"Lessor"
City of Schertz
"Lessee"
Page 12 of 13
(1) Mechanical Clarifier with all internals
(2) Chlorine Contact Basin
(3) Aeration / Digester Basin
(4) Miscellaneous Air Distribution System with drops and Diffusers
(5) Interconnecting Pipe, Valves and Fittings
(6) Walkways, Stairs and Bridges
(7) PD Blowers with Controls
(8) Bar Screen Box
(9) Flow Paced Disinfection System ina FRP building
(10) Flow Measuring Equipment
(11) Non - potable water system with controls
All of the above shall be 460v, three phase
Page 13 of 13