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PACE OWNER CONTRACT

THIS PACE OWNER CONTRACT (“Contract”) is made as of the ____ day of

_____________, 20__, by and between Travis County, Texas (“Travis County”) and

_____________________________________ (“Property Owner”).

RECITALS

A. Travis County has established a program to facilitate the financing by property

owners of energy and water conserving improvements for commercial, industrial, agricultural,

and large multifamily residential (5 or more dwelling units) real property (the “PACE Program”)

pursuant to Resolution No. ____________________________, dated

_________________________________2015, adopted by the Travis County Commissioners

Court in accordance with the provisions of the Property Assessed Clean Energy Act (the “PACE

Act”), Texas Local Government Code, Chapter 399. The Travis County Commissioners Court

has designated the entire territory within Travis County’s jurisdiction as a region within which

the authorized County official named below and the record owners of such real property may

enter into written contracts to impose assessments to repay the financing by owners of qualified

projects on the owner’s property. Unless otherwise expressly provided in this Contract, all terms

used herein have the same meanings ascribed to them in the PACE Act.

B. Property Owner is the legal and record owner of the tract of qualified commercial,

industrial, agricultural, or large multifamily residential real property within Travis County’s

jurisdiction located at ____________________________________,______________________,

Texas, and more fully described in Exhibit A attached hereto and made a part hereof (the

“Property”).

C. Pursuant to Application number _______________, Property Owner has applied

to Travis County to participate in the PACE Program by installing or modifying on the Property

certain permanent improvements intended to decrease water or energy consumption or demand,

which are or will be fixed to the Property as “qualified improvements”, as defined in Section

399.002 of the PACE Act. The installation or modification of such qualified improvements on

the Property will be a “qualified project” as defined in Section 399.002 of the PACE Act (the

“Project”).

D. Financing for the Project will be provided to Property Owner by

____________________________________________________ (the “Lender”), a qualified

lender selected by Property Owner, pursuant to a PACE Lender Contract executed by Lender and

Travis County, as required by Section 399.006(c) of the PACE Act. The PACE Lender Contract

calls for Travis County to impose a contractual assessment (the “Assessment”) on the Property at

the request of Property Owner for the benefit of Lender, as permitted by the PACE Act. The

financing will include only those costs and fees for which an assessment may be imposed under

the PACE Act. Pursuant to the PACE Lender Contract, Lender and Property Owner have

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negotiated the terms of a contract (the “Financing Documents”), the unsigned form of which is

attached hereto as Exhibit B, for the repayment to Lender of the financing advanced to Property

Owner for the Project. Travis County has agreed to maintain and continue the Assessment for

the benefit of Lender until such financing is repaid in full and to release the Assessment upon

notice from Lender of such payment, or foreclose the lien securing the Assessment for the

benefit of Lender upon notice from Lender of a default by Property Owner. Lender has agreed to

service the debt secured by the Assessment, either directly or through a designated servicer.

F. As required by Section 399.010 of the PACE Act, Property Owner notified the

holder(s) of any mortgage liens on the Property at least thirty (30) days prior to the date of this

Contract of Property Owner’s intention to participate in the PACE Program. The written consent

of each mortgage holder to the Assessment was obtained prior to the date of this Contract and is

attached hereto as Exhibit C and made a part hereof.

AGREEMENT

NOW, THEREFORE, the parties hereby agree as follows:

1. Imposition of Assessment. In consideration for the financing advanced or to be

advanced to Property Owner by Lender for the Project under the PACE Program pursuant to the

PACE Lender Contract, Property Owner hereby requests and agrees to the imposition by Travis

County of the Assessment on the Property in the total amount of $__________________,

together with all contractual interest provided in the contract between Property Owner and

Lender according to the Financing Documents attached hereto as Exhibit B, which set out the

amount financed, repayment installments, and amortization schedule for such Assessment.

Property Owner promises and agrees to pay such amount and interest to the order of Travis

County, in care of Lender, in satisfaction of the Assessment imposed pursuant to this Contract

and the PACE Act. Accordingly, Travis County hereby imposes the Assessment on the Property

to secure the payment of such amount, in accordance with the requirements of the PACE

Program and the provisions of the PACE Act.

2. Maintenance and Enforcement of Assessment. In consideration for Lender’s

agreement to advance financing to Property Owner for the Project pursuant to the PACE Lender

Contract, Travis County agrees to maintain and continue the Assessment on the Property for the

benefit of Lender until the amount set out above, contractual interest, and any statutory penalties

or interest, attorney’s fees, or costs accrued thereon in the event of default are paid in full and to

release the Assessment upon notice from Lender of such payment. Travis County agrees to

enforce the Assessment against the Property for the benefit of Lender in the event of a default by

Property Owner.

3. Installments. The Assessment, including the amount financed and contractual

interest, is due and payable in installments as set forth in the Financing Documents attached

hereto as Exhibit B and made a part hereof. As required by Section 399.009(a) (8) of the PACE

Act, the period during which such installments are payable does not exceed the useful life of the

Project. When the Assessment has been paid in full, Travis County’s rights under this Contract

will cease and terminate, and upon notice from Lender Travis County will execute and record a

release of the Assessment and this Contract.

4. Assignment of Right to Receive Installments. Lender will have the right to

assign or transfer the right to receive the installments of the financing secured by the

Assessment, provided all of the following conditions are met:

(a) The assignment or transfer is made to a qualified lender as defined in the PACE

Lender Contract;

(b) Property Owner, the PACE Program Administrator, and Travis County are

notified in writing of the assignment or transfer and the address to which payment of the

future installments should be mailed at least 30 days before the next installment is due

according to the payment schedule included in the Financing Documents attached hereto

as Exhibit B; and

explicit written assumption of all of Lender’s obligations under PACE Lender Contract.

Upon written notice to Property Owner, the PACE Program Administrator, and Travis County of

an assignment or transfer of the right to receive the installments that meets all of these

conditions, Travis County will execute a release of the Lender making such assignment from the

PACE Lender Contract and all of the obligations of the Lender under such Contract accruing

after the date of the assignment will be assumed by and transferred to such assignee or

transferee. Any attempt to assign or transfer the right to receive the installments that does not

meet all of these conditions is void.

5. Lien Priority and Enforcement. Pursuant to Section 399.014 of the PACE Act,

(a) Delinquent installments of the debt secured by the Assessment will incur

interest and penalties in the same manner and in the same amount as delinquent property

taxes, viz., a delinquent installment incurs a penalty of 6% of the amount of the

installment for the first calendar month it is delinquent plus 1% for each additional month

or portion of a month the installment remains unpaid prior to July 1 of the year in which

it becomes delinquent. However, an installment delinquent on July 1 incurs a total

penalty of 12% of the amount of the delinquent installment without regard to the number

of months it has been delinquent. A delinquent installment will also accrue interest at the

rate of 1% for each month or portion of a month that the installment remains unpaid.

Subject to the limitation set out in paragraph 13 below, penalties and interest payable

under this paragraph will be retained by Travis County to compensate it for the cost of

enforcing the Assessment.

(b) The Assessment, together with any penalties and interest thereon,

(1) is a first and prior lien against the Property from the date on which this

Contract is filed in the Official Public Records of Travis County, as provided by

Section 399.013 of the PACE Act, until the financing secured by the Assessment

and any penalties and interest are paid; and

(2) such lien has the same priority status as a lien for any other ad valorem

tax, pursuant to Section 399.014(a)(2) of the PACE Act.

the debt secured by the Assessment that has not yet become due is not eliminated by

foreclosure of a property tax lien, according to Section 399.014(b) of the PACE Act. In

the event of a sale or transfer of the Property by Property Owner, the obligation for the

Assessment will be transferred to the succeeding owner without recourse on Travis

County or the PACE Program Administrator, and with recourse on Property Owner only

for any unpaid installments of the Assessment that became due during Property Owner’s

period of ownership.

(d) In the event of a default by Property Owner in payment of the installments

called for by the Financing Documents, the lien created by the Assessment will be

enforced by Travis County in the same manner according to Texas Tax Code Secs. 33.41

to 34.23 that a property tax lien against real property may be enforced by a local

government, to the extent the enforcement is consistent with Section 50, Article XVI,

Texas Constitution.

(e) In a suit to collect a delinquent installment of the Assessment, Travis

County will be entitled to recover costs and expenses, including attorney's fees in the

amount of 15% of the total amount of the delinquent installment, penalties, and interest

due, in the same manner according to Texas Tax Code Sec. 33.48 as in a suit to collect a

delinquent property tax.

6. Written Contract Required by PACE Act. This Contract constitutes a written

contract for the Assessment between the Property Owner and Travis County as required by

Section 399.006 of the PACE Act. A Notice of Contractual Assessment Lien will be recorded in

the Official Public Records of Travis County as notice of the contractual Assessment, in

accordance with the requirements of Section 399.013 of the PACE Act.

7. Binding Effect. This Contract inures to the benefit of Travis County and is

binding upon Property Owner, its heirs, successors, and assigns.

8. Notices. All notices and other communications required or permitted by this

Contract shall be in writing and mailed by certified mail, return receipt requested, addressed to

the other party at its address shown below the signature of such party or at such other address as

such party may from time to time designate in writing to the other party, and shall be effective

from the date of receipt.

9. Governing Law. This Contract shall in all respects be governed by and construed

in accordance with the laws of the State of Texas.

10. Entire Agreement. This Contract constitutes the entire agreement between Travis

County and Property Owner with respect to the subject matter hereof and may not be amended or

altered in any manner except by a document in writing executed by both parties.

11. Further Assurances. Property Owner further covenants and agrees to do, execute

and deliver, or cause to be done, executed, and delivered all such further acts for implementing

the intention of this Contract as may be reasonably necessary or required.

12. Counterparts. This Contract may be executed in any number of counterparts, all

of which when taken together shall constitute one agreement binding on the parties,

notwithstanding that all parties are not signatories to the same counterpart.

13. Interest. Interest and penalties in the event of default, as provided above, are

explicitly authorized by Section 399.014(d) of the PACE Act. However, in no event will the

total amount of interest on the Assessment, including statutory interest payable to Travis County

and contractual interest payable to Lender under the Financing Documents, exceed the maximum

amount or rate of nonusurious interest that may be contracted for, charged, or collected under

Texas law (the “usury limit”). If the total amount of interest payable to Travis County and

Lender exceeds the usury limit, the interest payable to Travis County will be reduced and any

interest in excess of the usury limit will be credited to the amount payable to Travis County or

refunded. This provision overrides any conflicting provisions in this Contract.

14. Special Provisions. (to be added as necessary)

EXECUTED as of _______________________________________________, 2015 by:

PROPERTY OWNER: TRAVIS COUNTY, TEXAS

By: By:

Name: Bruce Elfant, Travis County Tax

Assessor-Collector

Address:

P.O. Box 149328

____________________________________ Austin, Texas 78714-9328

AUTHORIZED COUNTY OFFICIAL

EXHIBIT A

PROPERTY DESCRIPTION

EXHIBIT B

FINANCING DOCUMENTS

EXHIBIT C

MORTGAGE HOLDER(S) CONSENT

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