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<br />hereafter incorporated in and/or attached to the Equipment, Lessor shall have a secured interest therein upon such incorporation
<br />or attachment to the Equipment and lien-free title thereto (not including the lien of Lessor) shall be transferred to Lessor, without
<br />compensation to Lessee, upon termination of this Lease, except as otherwise expressly provided herein. Lessee does hereby grant
<br />to Lessor a security interest in all of its right, title and interest in, to and arising hereunder, the Equipment described herein and
<br />the proceeds of both to secure the payment and performance by Lessee of all of its liabilities and obligations arising hereunder and,
<br />in addition, all other obligations or liabilities of Lessee to Lessor, of any kind or character, direct or indirect, contingent or absolute,
<br />whether now existing or hereafter arising or incurred. This Agreement constitutes a security agreement and/or pledge agreement
<br />which pledges the Equipment to the Lessor to secure performance of this Agreement by Lessee. Lessor shall have all of the rights
<br />and remedies of a secured party under the Uniform Commercial Code of the State of Texas (the "State") and other applicable law
<br />in addition to all of its rights and remedies under the terms and conditions hereof. Lessee agrees to execute and file Uniform
<br />Commercial Code Financing Statements and any and all other documents and instruments necessary to perfect Lessor's interest
<br />in this Lease, the Equipment and the payments due hereunder. Upon termination of this Lease, subject to the exercise by Lessee
<br />of any purchase option, if any, hereunder, Lessee shall, without charge to Lessor, take all actions necessary and reasonably
<br />nested by Lessor to transfer ownership of the Equipment to Lessor, including, without limitation, transfer of title under the
<br />( ificate(s).
<br />
<br />7. REPRESENTATIONS. WARRANTIES AND COVENANTS OF LESSEE. Lessee represents, warrants and
<br />covenants to Lessor as follows:
<br />
<br />a. Lessee is and will remain, to the extent within Lessee's control, a body corporate and politic, duly organized
<br />and existing as a political subdivision under the Constitution and laws of the State.
<br />
<br />b. Lessee is fully authorized and permitted, and has received all authorizations, consents and approvals of
<br />governmental bodies or agencies necessary, if any, to enter into this Lease and to execute any and all documentation required
<br />herein, to lease the Equipment upon the terms set forth herein and to perform the terms of this Lease and all other documents
<br />executed in connection herewith, none of which conflicts with any provisions of the Constitution or laws of the State, regulations,
<br />ordinances, judgments or orders of public authorities applicable to Lessee.
<br />
<br />c. The governing body of Lessee has heretofore adopted the resolution attached hereto as Exhibit "B" and
<br />incorporated herein by reference authorizing the appropriate officials of Lessee to execute and deliver this Lease and all other
<br />documents relating hereto.
<br />
<br />d. This Lease, and all other documents executed or delivered in connection herewith are, and throughout the term
<br />of this Lease shall remain, valid and binding and enforceable legal obligations of Lessee, in accordance with its terms.
<br />
<br />e. The execution, delivery and performance by Lessee of this Lease and all other documents relating hereto will
<br />n :esult in any breach of the terms or conditions of any agreement or instrument under which Lessee is a party or is obligated,
<br />a Lessee is not in default in the performance or observance of any obligations, covenants or conditions of any such agreement
<br />O. ulstrument.
<br />
<br />f. No actions, suits or proceedings are pending or threatened against Lessee, nor, to the best of Lessee's
<br />knowledge, is there any basis therefor, that might adversely affect the payment by Lessee of the rental payments under this Lease,
<br />the performance by Lessee of its other obligations arising hereunder or under any documents executed in connection herewith, or
<br />the financial condition, business or operations of Lessee except as otherwise may be noted in Exhibit "DOl attached.
<br />
<br />g. All financial statements and budgets, if any, previously given and at any time hereafter given by or on behalf
<br />of Lessee are and shall be true, complete and correct as of the date thereof and do and shall fairly present Lessee's financial
<br />condition as of the date thereof, and there has been no material adverse change in the creditworthiness, financial condition or the
<br />results of the operations of Lessee since the date of the latest financial statements of Lessee, if any, given to Lessor.
<br />
<br />h. In addition to notices required herein, Lessee shall immediately give notice in writing to Lessor of (i) the
<br />occurrence of an Event of Default, or any condition, event or act which with the giving ofnotice,fa,ilure to cure, the passage of
<br />time, or all of the foregoing would constitute such an Event of Default; and (ii) any change in the name or nature of Lessee, any
<br />change in its form, management or organizational structure and any change in Lessee's address ofprincipallocation(s) of business
<br />or location(s) of the Equipment.
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