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HomeMy WebLinkAbout1994-291 RESOLUTION NO. 94-291 1 2 RESOLUTION OF THE CITY OF SAN BERNARDINO ACCEPTING A LEAS PURCHASE MASTER AGREEMENT FOR FIRST PUBLIC FINANCE CORPORATION AWARDING A LEASE PURCHASE SCHEDULE 1 AGREEMENT TO FIRST PUBLI FINANCE CORPORATION FOR THE FINANCING OF NINETY-EIGHT HUNDRE (9,800) 90 GALLON AUTOMATED REFUSE COLLECTION CONTAINERS, TO B UTILIZED BY THE PUBLIC SERVICES DEPARTMENT. 3 4 5 6 7 . and best BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY 0 SAN BERNARDINO AS FOLLOWS: SECTION 1. That First Public Finance Corporation is the lowes responsible bidder for the financing of ninety-eigh 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 hundred (9,800) 90 gallon automated refuse collection containers i accordance with financing bid #412-449 for the total amount 0 $429,083.50 at 6.5960% interest payable six (6) months in arrear over seven (7) years for a total payment of $535,217.30; pursuant t ~is determination, the Purchasing Agent is hereby authorized an directed to issue a Lease Purchase Schedule 1 Agreement for sai (9,800) each, automated refuse collectio ninety-eight hundred containers to said lowest and best responsible bidder; such awar shall only be effective upon the issuance of a Lease Purchas Schedule 1 Agreement by the Purchasing Agent; and all othe quotations therefore are hereby rejected. ;, " The authorization to execute the above reference SECTION 2. 1:Jl, " " Lease Purchase Schedule 1 Agreement is rescinded if the parties t the agreement fail to execute it within sixty (60) days of th passage of this resolution. I I I I I I I I I I I I I I I I September 13, 1994 -1- 94-291 , . 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION OF THE CITY OF SAN BERNARDINO ACCEPTING A LEAS PURCHASE MASTER AGREEMENT FOR FIRST PUBLIC FINANCE CORPORATION AWARDING A LEASE PURCHASE AGREEMENT TO FIRST PUBLIC FINANC CORPORATION FOR THE FINANCING OF NINETY-EIGHT HUNDRED (9,800) 9 GALLON AUTOMATED REFUSE COLLECTION CONTAINERS, TO BE UTILIZED BY TH PUBLIC SERVICES DEPARTMENT. I HEREBY CERTIFY that the foregoing resolution was duly adopte by the Mayor and Common Council of the City of San Bernardino at meeting thereof, held on the 19th day 0 reqular September , 199JL, by the following vote, to wit: Council Members: Aves Navs Abstain Absen NEGRETE ---1L CURLIN ---1L HERNANDEZ ---1L OBERHELMAN ---1L DEVLIN ---1L POPE-LUDLAM ---1L MILLER ---1L ~ City Clerk The foregoing resolution is hereby approved this Seotember , 1994. 22nd day 0 ~.. 6??rl TOM MINOR, Mayor City of San Bernardino 1/ " Approved as to form and legal content: James F. Penman, #orn~ By' '~"Ud <.-a." September 13, 1994 -2- _.it.. 94-291 CALIFORNIA MASTER LEASE WITH OPTION TO PURCHASE AGREEMENT THIS CALIFORNIA MASTER LEASE WITH OPTION TO PURCHASE AGREEMENT (this "Lease"), dated as of the day set forth on the execution page hereof, is made and entered into by and between First Public Finance Corporation, a corporation duly organized and existing under the laws of the State of Oklahoma, as Lessor ('Lessor"), whose principal business address is as shown on the execution page hereof; and the Lessee identified on the execution page 12 hereof, a political subdivision of the State of California (the "State'), as Lessee ("Lessee"), whose address is as shown on the execution page hereof. In consideration of the mutual covenants herein contained, the parties hereto recite and agree as follows: ARTICLE 1: Definitions and Exhibits Section 1.1. Definitions. Unless the context otherwise requires, the terms defined in this Section shall, for all purposes of this Lease, have the meanings herein specified, Contractor: Each of the manufacturers or vendors from whom Lessee (or Lessor at Lessee's request) has ordered or will order or with whom Lessee (or Lessor at Lessee's request) has contracted or will contract for the manufacture, delivery and/or installation of the Equipment. Equioment or Equioment Grouo: An item or items of personal property designated from time to me by Lessee which are described in an Equipment Schedule, and which are being or will be leased with option to purchase by Lessee pursuant to this Lease, An Equipment Group consists of the Equipment listed on any single page or set of pages of Exhibit A. auioment Schedule: A schedule consisting of the separate but like numbered pages of Exhibits A and B which have been completed with respect to Equipment Group and executed by Lessor and Lessee as indicated herein. Final Termination Date: With respect to any Equipment Group, the date specified in the Equipment Schedule relating thereto, which date corresponds to the end of the useful life of such Equipment Group_ Fiscal Year: The 12-month fiscal period of Lessee which commences in every year on the date shown on the execution page hereof and ends on the following date shown on the execution page hereof. Counsel~ An attomey duly admitted to the practice of law before the highest court of the State who could be a full-time employee of Lessor or Lessee. I nterest: The portion of any Rental Payment designated as and comprising interest as shown in any Equipment Schedule, Lease: With respect to each Equipment Group, this California Master Lease With Option to Purchase Agreement and the Equipment Schedule in which such Equipment Group is described, which shall constitute a separate contract relating to such Equipment Group. Net ProceedS: Any insurance proceeds or condemnation awards paid with respect to any Equipment remaining after payment therefrom of all expenses incurred in the collection thereof. pavment Date: The date upon which any Rental Payment is due and payable as provided in any Equipment Schedule. "'ermitted Encumbrances: As of any particular time: (i) liens for taxes and assessments not then delinquent, (Ii) this .ease and amendments hereto and (iii) Lessor's interest in the Equipment. Princioal: The portion of any Rental Payment designated as principal in any Equipment Schedule. ~.." '\.. ~ Califomialease.Page 1 . pur~hase ODtiD~'~pri~e'tith respect to any Equipment Group, as of the Payment Date specified in the Equipment ~hedule relating thereto,. the amount so designated and set forth opposite each such date in such Equipment . ~ cicheduJe.' , " , Rental pavment: With respect to any Equipment Group, the payment due trom Lessee to Lessor on each Payment Date during the Lease Term, as shown in the Equipment Schedule relating thereto. SpeciflcatiDns: The bid specifications and/or purchase order pursuant to which Lessee has ordered any Equipment trom a Contractor. State and Federal Law or Laws: The Constitution and any law of the State and any chMer, ordinance, rule or regulation of any agency or political subdivision of the State; and any law of the United States, and any rule or regulation of any federal agency. Term of This Lease or Lease Term: With respect to any Equipment Group, the period during which this Lease is in effect as specified in Section 4,1. Section 1.2. Exhibits Exhibit A: A schedule executed by Lessor and Lessee describing an Equipment Group being leased by Lessee pursuant to this Lease, and setting forth the date and amount of each Rental Payment coming due during the Lease Tenn with respect to such Equipment Group, the amount of such Rental Payments comprising Principal and Interest, and the price at which Lessee may exercise its option to purchase Lessor's interest in such Equipment Group in accordance with Article X. Lessee hereby and authorizes Lessor to insert the serial or other identifying numbers relating to the Equipment and the due date of each Rental Payment in Exhibit A when available, and Lessee hereby agrees to sign and return to Lessor any such schedule so completed by Lessor within three days of request by Lessor (provided that no failure by t .essee to sign and retlm any such schedule shall affect the validity and enforceability of any such schedule completed by _essor pursuant to the tenns hereof). Exhibit B: A form of Certificate of Acceptance of Lessee indicating that the Equipment Group described therein has been delivered and installed in accordance with the SpecifICations, and has been accepted by Lessee, the date on which Rental Payments shown in the page of Exhibit A relating thereto shall commence, and that certain other requirements have been met by Lessee. Exhibit C: A form of opinion of Counsel to Lessee as to the organiZation, nature and powers of Lessee: the validity, execution and delivery of this Lease and various related documents: the absence of litigation; and related matters. Exhibit D: A form of resolution of the governing body of Lessee relating to the Lease in the form of Exhioit D.1 hereto and, if applicable, also relating to certain federal tax matters in the form of Exhibit 0-2 hereto. ARTICLE II: REPRESENTATIONS, WARRANTIES AND COVENANTS Section 2.1. ReDresentations. Warranties and Covenants of Lessee. Lessee represents and warrants to and covenants with Lessor with respect to this Lease and each Equipment Schedule, as follows: (a) Lessee is a political subdivision of the State, dUly organized and existing under the Constitution and laws of the State, and is authorized under the Constitution and laws of the State to enter into this Lease and the transactions contemplated hereby, and to perform all of its obligations hereunder. (b) The execution and delivery of this Lease by the officer of Lessee executing it has been duly authorized by a duly adopted resolution of Lessee's governing body, or by other appropriate offICial action, and such action has complied and/or will comply with all public bidding and other State and Federal Laws applicable to this Lease and the .icquisition and financing of the Equipment by Lessee, " CaifomiaL.ease.Page 2 9 ~ ."1 0' (c) Lessee will use the Equipment during the Lease Term only to perform essential governmental functions, (d) Lessee will take no action that would cause the interest portion of the Rental Payments to become includable in gross income of the recipient for federal income tax purposes under the Internal Revenue Code of 1986, as amended (the "Codel, and Treasury Regulations promulgated thereunder (the "Regulationsl, and Lessee will take and will cause its officers, employees and agents to take all affirmative actions legally wlllin its power necessary to enslJ'e that the interest portion of the Rental Payments does not become includable in gross income of the recipient for federal income tax purposes under the Code and Regulations; all as amended from tine to time (including, without limitation, the calculation and payment of any rebate required to preserve such exclusion). (e) Lessee will submit to the Secretary of the Treasury information reporting statements and other information relating to this Lease and each Equipment Schedule at the times and in the forms required by the Code and the Regulations; and if applicable, Lessee will cause a resolution substantially in the form attached hereto as Exhibit 0 to be adopted by its governing body with respect to this Lease and each Equipment Schedule. (I) Upon delivery and installation of any Equipment Group, Lessee will provide to Lessor a completed and executed copy of a Certificate of Acceptance relating thereto in the form attached hereto as Exhibit B, and upon execution of this Lease and/or each Acceptance Certificate Lessee will provide to Lessor an opinion of its Independent Counsel in the form attached hereto as Exhilit C. (g) Lessee finds and determines that the amount of the Rental Payments set forth in the Equipment Schedules are equal to the fair rental value of the related Equipment Groups during the respective FISCal Year of Lessee in which such Rental Payments are made. (h) The Equipment will have a useful life that is substantially in excess of the Lease Term. 'RTICLE III: LEASE OF EQUIPMENT Section 3.1. Acquisition of Equloment. Lessee shall advise Lessor of its desire to lease Equipment and of the desired lease terms for the Equipment Group. Upon agreement by Lessor and Lessee as to the lease of the Equipment and such terms, Lessor shall furnish to Lessee a proposed Exhibit A relating to the Equipment Group completed insofar as possible. Lessee (or Lessor at Lessee's request) shall order the Equipment Group from the appropriate Contractor or Contractors and notify Lessor in writing of the Equipment cost and the estinated delivery period. Nothing herein shall obligate Lessor to lease any Equipment to Lessee until Lessor shaD have so concurred in writing. Section 3.2. Eouipment Delivery: Documentation. Lessor and Lessee shall complete and execute an Exhibit A with respect to each Equipment Group. Upon delivery of any Equipment Group, Lessee shall inspect such Equipment, and if such Equipment meets Lessee's Specifications, Lessee shall, within three (3) business days from the date of delivery of the Equipment Group, provide to Lessor a completed and executed copy of a Certificate of AcceptanCe relating thereto in the form attached hereto as Exhibit B. Simuttaneously with the delivery, Lessor and Lessee shall take all actions necessary to vest legal title to the Equipment Group in Lessee, and to perfect a security interest therein in favor of Lessor or a person, firm or corporation designated by it. Section 3.3. Lease: Enjoyment: Insoection. Lessor hereby leases to Lessee each Equipment Group made subject to this Lease, and Lessee hereby leases from Lessor such Equipment Group, upon the terms and conditions set forth in this Lease. Lessor hereby covenants to provide Lessee during the Lease Term with the quiet use and enjoyment of the Equipment, and Lessee shall during the Lease Term peaceably and quietly have and hold and enjoy the Equipment, without suit, trouble or hindrance from Lessor, except as expressly set forth in this Lease. Lessor will, at the request of Lessee and at Lessee's cost, join in any legal action in which Lessee asserts its right to such possession and enjoyment to the extent Lessor lawfully may do so. Lessee agrees that Lessor shall have the right at all reasonable times to examine and inspect the Equipment. Lessee flJ'ther agrees that Lessor shaH have such rights of access to the <:quipment as may be reasonably necessary to cause the proper maintenance of the Equipment in the event of failure by .essee to perform its obligations hereunder. CaIIomiaLease.Page S 94' 291", ' ARTICLE IV: TERM OF LEASE ,;ection 4.1. Lease Term. This Lease shall be in effect for a Lease Term commencing upon its date of execution and ending as provided in Section 4.2. This Lease shall be in effect with respect to each Equipment Group for a Lease Term commencing upon the date of execution of Exhibit A of the Equipment Schedule relating thereto and ending as provided in Section 4.2. unless such Lease Term is extended as provided in this Section. provided that Rental Payments relating to an Equipment Group shall be due and payable commencing upon execution of the related Certificate of Acceptance. If on the date of termination of this Lease with respect to any Equipment Group the Rental Payments shall not be fully paid. or provision therefor made. or if such Rental Payments shall have been abated at any time and for any reason, then such Lease Term shall be extended until the dale upon which all such Rental Payments shall be fully paid, except thai such Lease Term shall in no event extend beyond the Final Termination Date. Section 4.2. Termination of Lease Term. The Lease Term with respect to any Equipment Group will terminale upon the occurrence of the first of the following events: (a) the exercise by Lessee of its option to purchase Lessor's interest in such Equipment Group pursuant to Article X; (b) a default by Lessee with respect to such Equipment Group and Lessor's election to terminale this Lease with respect to such Equipment Group pursuant to Article XII; or (c) the payment by Lessee of all Rental Payments and all other amounts authorized or required to be paid by Lessee hereunder with respect to such Equipment Group. ARTICLE V: RENTAL PAYMENTS Section 5.1. Rental Payments. Subject to Section 5.2, Lessee agrees to pay Rental Payments with respect to each Equipment Group during the Lease Term, as rental for the use and possession of such Equipment Group, in the amounts and on the dates specified in the Equipment SChedule relaling thereto. provided that Rental Payments relating to an Equipment Group shall be due and payable commencing upon execution of the related Certificate of Acceptance. Lessee hereby authorizes Lessor to insert the due date of each Rental Payment on Exhibit A when available. and Lessee '1ereby agrees to sign and return to Lessor any such schedule so completed by Lessor within three days of request by _essor (provided that no failure by Lessee to sign and return any such schedule shall affect the validity and enforceability of any such schedule completed by Lessor pursuant to the terms hereOf). All Rental Payments shall be paid to Lessor; or to such other assignee(s) to which Lessor has assigned such Rental Payments as specified in Article XI, at such place as Lessor or such assignee(s) may from tine to time designale by written notice to Lessee. Lessee shall pay the Rental payments exclusively from moneys legally available therefor, in lawful money of the United States of America. Section 5.2. Abatement. During any period in which, by reason of material damage or destruction or taking under the power of eminent domain (or sale to any entity threatening the use of such power) or material title defect with respect to any Equipment Group, there is substantial interference with the use and possession by Lessee of any pan of such Equipment Group, the Rental Payments due hereunder with respect to such Equipment Group shall be abated propationately in whole or in part. The amount of abatement shall be such thai the remaining rental obligation for a given rental period represents fair consideralion for the use and possession of the portions of such Equipment Group that are complete and are not affected by such interference. Such abatement shall commence on the date thai Lessee's use and possession of all or a portion of such Equipment Group is restricted because it has not been completed or because of such interference and end on the earlier of the dale on which the use and possession thereof are restored to Lessee or the date on which Lessee uses the Net Proceeds of insurance or a condemnation awards to pay the Rental Payments or the applicable Purchase Option Price. In the event of any such interference, this Lease shall continue in full force and effect, Lessee waives the benefits of Civil Code Section 1932 and any and all other rights to terminate this Lease by virtue of any interference with the use and possession of the Equipment. Section 5.3. ApDroDriatlons. The person or entity in charge of preparing Lessee's budget will include in the budget request for each Rscal Year the Rental Paymel1lS to become due in such FISCal Year with respect to each Equipment Group. and wDl use all reasonable and lawful means available to seclJ'e the appropriation of money for such FISCal year sufficient to pay all such Rental Payments coming due therein. The covenants on the part of Lessee contained in this '.ease, including the covenant to budget and appropriate amounts necessary to make Rental Payments. shall be deemed .0 be duties imposed by law, and It shall be the duty of each and every public official of Lessee to take such action and do such things as are required by law in the performance of the official duty of such officials to enable Lessee to carry out and perform the covenants and agreements in this Lease agreed to be carried out and performed by Lessee. This Lease is a firm lease and not a non appropriatiOn lease. Caitomial.ea8e.Page 4 9,A ,""'" .fl! " . ~ seeton 5.4, Legallv Available Funds. The obligations of Lessee under this Lease, including its obligations to pay ',e Remal Paymems due with respect to any Equipment Group, in any FIScal year for which this Lease is in effect, shall not "onstitute an indebtedness of Lessee within the meaning of the Constitution and laws of the State. Remal Paymems shall be made from any funds legally available therefor, but nothing herein shall constitute a pledge by Lessee of any taxes or other moneys, other than moneys lawfully appropriated from time to time by or for the benefrt of Lessee for this purpose and the proceeds or Net proceeds of the Equipmem, to the paymem of any Remal paymem or other amoum coming due hereunder. Section 5.5. Rental Pavments to be Unconditional. The obligation of Lessee to make Remal paymems or any other paymems required hereunder shall be absolute and unconditional in all events except as otherwise specifically provided in this Lease. Notwithstanding any dispute between Lessee and Lessor or any other person, Lessee shall make all Remal paymems and other paymems required hereunder when due and shall not withhold any Remal paymem or other paymem pending final resolution of such dispute nor shall Lessee assert any right of set-off or coumerclaim against its obligation to make such Remal paymems or other paymems required under this Lease. Lessee's obligation to make Remal Payments or other paymems during the Lease Term shall not be abated through accidem or unforeseen circumstances except as provided in Section 5.2. ARTICLE VI: INSURANCE AND NEGLIGENCE Section 6.1. Liability Insurance. Upon ordering any Equipmem Group and prior to receipt of possession of the Equipment Group, Lessee shall take such measures as may be necessary to ensure that any liability for injuries to or death of any person or damage to or loss of property arising out of or in any way relating to the condition or the operation of the Equipmem Group or any part hereof, is covered by a blanket or other general liability insurance policy maimained by lessee, with a coverage limit of not less than $1,000,000 per occurrence, The Net proceeds of all such insurance shall be applied toward extinguishment or satisfaction of the liability with respect to which any Net Proceeds may be paid, <;ection 6.2. ProDertv Insurance. Upon receipt of possession of any Equipmem Group, Lessee shall have an , .ssume the risk of loss with respect thereto. Lessee shall procure and maimain continuously in effect during the Lease Term, all-risk insurance (including, if requested by Lessor, insurance against earth quakes), subject only to the standard exclusions contained in the policy, in such amoum as will be at least sufficiem so that a claim may be made for the full replacemem cost of any part of the Equipmem damages or destroyed and to pay the applicable Purchase Option Price of the Equipmem. Such insurance may be provided by a rider to an existing policy or under a separate policy. Such insurance may be written with customary deductible amounts acceptable to Lessor. The Net Proceeds of insurance required by this Section shall be applied to the prompt repair, restoration or replacemem of the Equipmem, or to the purchase of the Equipmem, as provided in Section 6.8. Any Net Proceeds not needed for those purposes shall be paid to Lessee, Section 6.3. Worker's ComDensation Insurance. If required by State Law, Lessee shall carry worker's compensation insurance covering all employees on, in, near or about the Equipmem, and upon request, shall furnish to Lessor certificates evidencing such coverage throughout the Lease Term, Section 6.4. Rental InterruDtion and Loss of Use and OccuDancy Insurance. Lessee shall maimain or cause to be maimained at its expense throughout the Lease Term, remal imerruption insurance against Loss of use of the Equipmem or portions thereof with coverage equal to the maximum total Remal payments payable by Lessee for any consecutive 24-month-period. The policy shall insure against abatemem of Remal paymems payable by Lessee resulting from Lessee's loss of use of the Equipmem or any substantial portion thereof and caused by any and all perils, either insured or uninsured, including acts of God. Such insurance may be maimained in conjunction with or separate from any other similar insurance carried by Lessee. The Net Proceeds of such insurance shall be payable to Lessor in amoums proportionate to Lessee's loss of use of the Equipment and the corresponding remal abatemem, if any, and shall supplemem Lessee's applicable Remal Paymems, if any, during the restoration period in sufficiem amoum to make Lessor whole, .ection 6.5. Requirements for All Insurance. All insurance policies (or riders) required by this Article shall be taken out and maimained with responsible insurance companies organized under the laws of one of the states of the United States and qualified to do business in the State; and shall comain a provision that the insurer shall not cancel or revise coverage thereunder without giving written notice to the insured parties at least ten (10) days before the cancellation or revision becomes effective, Each insurance policy or rider required by this Article shall name Lessor as an l., CalifomiaLeaae.Page 5 )4 29! add~ional insured party and loss payee and, if required by Lessor, shall include a lender's loss payable endorsement for "Ie benef~ of Lessor, Prior to delivery of the Equipment to the Lessee, Lessee shall depos~ w~h Lessor policies (and ,iders and endorsements, if applicable) evidencing any such insurance procured by ~, or a certificate or certificates of the respective ins'urers stating that such insurance is in full force and effect. Before the expiration of any such policy or rider, Lessee shall furnish to Lessor evidence that the policy has been renewed or replaced by another policy conforming to the provisions ofthis Article. Section 6.6. Self-Insurance. Notwithstanding the provisions of Sections 6.1 through 6.3, Lessee may elect to meet the requirements of any such Section through self-insurance provided by a Qualified Self-Insurance Program (defined below) having coverage Iim~s equal to or greater than those specified in such Section. In such event, Lessee shall give Lessor notice of such election and provide to Lessor a full, true and correct copy of all documents providing for the establishment and administration of the Qualified Self-Insurance Program and shall execute an addendum to this Lease, As used herein, "Qualified Self-Insurance Program" means a program of self.insurance which has been established by Lessee, or by Lessee and other political subdivisions of the State, pursuant to a State Law specifically authorizing the program, and which is funded in a manner similar to commercial insurance or in a manner specified in such Stale Law. Section 6.7. Lessee's Negllaence. Lessee assumes all risks and liabilities, whether or not covered by insurance, for loss or damage to any Equipment and for injury to or death of any person or damage to any property, whether such injury or death be w~h respect to agents or employees of Lessee or of third parties, and whether such property damage be to Lessee's property or the property of others, which is proximately caused by the negligent conduct of Lessee, ~s officers, employees and agents, Lessee hereby assumes responsibility for, indemnifies Lessor against and agrees to reimburse Lessor for all liabilities, obligations, losses, damages, penahies, claims, actions, costs and expenses (including reasonable attorneys' fees) of whatsoever kind and nature, imposed on, incurred by or asserted against Lessor that in any way relate to or arise out of a claim, suit or proceeding based in whole or in part upon the negligent conduct of Lessee, ~s officers, employees and agents, or based upon the possession, use, operation, condition or storage of the Equipment (unless caused by Lessor or its agents) to the maximum extent permitted by law. iection 6.8. Damaoe to or Destruction of EouiDment. If after delivery of any Equipment to Lessee all or any part of the Equipment is lost, stolen, destroyed or damages beyond repair, Lessee shall as soon as practicable after such event either: (a) replace the same at Lessee's sole cost and expense with equipment of equal or greater value to the Equipment immediately prior to the time of the loss occurrence, such replacement equipment to be subject to Lessor's reasonable approval, whereupon such replacement equipment shall be substituted in this Lease and the other related documents by appropriate endorsement or amendment; or (b) pay the applicable Purchase Option Price of the Equipment Group to which such Equipment belongs as set forth in Exhibit A. Lessee shall notify Lessor of which course of action it will take within fifteen (15) days after the loss occurrence. If Lessee fails or refuses to notify Lessor within the required period, Lessor may, at its option, declare the applicable Purchase Option Price of the Equipment Group to which such Equipment belongs set forth in Exhibit A immediately due and payable, and Lessee shall be obligated to pay the same. The Net Proceeds of all insurance payable with respect to the Equipment shall be available to Lessee and shall be sued to discharge Lessee's obligation under this Section. On payment thereupon of the Purchase Price Option w~h respect to any Equipment Group, this Lease shall terminate with respect to such Equipment and Lessee thereupon shall become ent~led to such Equipment AS IS, WITHOUT WARRANTIES, EXPRESS OR IMPLIED. INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR FITNESS FOR THE USE CONTEMPLATED BY LESSEE, except that such Equipment shall not be subject to any lien or encumbrance created by or arising through Lessor, ARTICLE VII: OTHER OBLIGATIONS OF LESSEE Section 7.1. Use: Permits. Lessee shall exercise due care in the installation, use, operation and maintenance of the Equipment, and shall not install, use, operate or maintain the Equipment improperly, carelesSly, in violation of any State and Federal Law or for a purpose or in a manner contrary to that contemplated by this Lease, Lessee shall obtain all permits and licenses necessary for the installation, operation, possession and use of the Equipment. Lessee shall comply with all State and Federal Laws applicable to the installation, use, possession and operation of the Equipment, and if .ompliance with any such State and Federal Law requires changes or additions to be made to the Equipment, such changes or additions shall be made by Lessee at its expense, CaWfomiaLeaS8.Page 6 . 94 24'1 Section 7.2. Maintenance of EouiDment by Lessee. Lessee shall, at its own expense, maintain, preserve and 1ep the Equipment in good repair, wor1<ing order and condttion, and shall from time to time make all repairs and ,dpiacements necessary to keep the Equipment in such condttion, Lessor shall have no responsibility for any of these repm or replacements. Section 7.3. Taxes. Other Governmental Charaes and Utility Charaes Except as expressly limtted by this Section, Lessee shall pay all taxes and other charges of any kind which are at any time lawfully assessed or levied against or wtth respect to the Equipment, the Rental Payments or any pan thereof, or which become due during the Lease Term, whether assessed against Lessee or Lessor. Lessees shall also pay when due all gas, water, steam, electricity, heat, power, telephone, and other charges incurred in the operation, maintenance, use, occupancy and upkeep of the Equipment, and all special assessments and charges lawfully made by any governmental body for public improvements that may be secured by a lien on the Equipment; provided that with respect to special assessments or other governmental charges that may lawfully be paid in installments over a period of years, Lessee shall be obligated to pay only such installments as are required to be paid during the Lease Term as and when the same become due. Lessee shall not be required to pay any federal, state or local income, inherttance, estate, succession, transfer, gift, franchise, gross receipts, profit, excess profit, capttal stock, corporate, or other similar tax payable by Lessor, its successors or assigns,unless such tax is made in lieu of or as a substitute for any tax, assessment or charge which is the obligation of Lessee under this Section, Section 7.4. Advances. If Lessee shall fail to perfonn any of its obligations under this Miele, Lessor may, but shall not be obligated to, take such action as may be necessary to cure such failure, including the advancement of money, and Lessee shall be obligated to repay all such advances on demand, with interest at the rate of 18% per annum or the maximum rate pennitted by law, whichever is less, from the date of the advance to the date of repayment. ARTICLE VIII:L TITLE; SECURITY INTEREST: LIENS ~ection 8.1. I.Ua... During the Lease Term wtth respect to any Equipment Group, and so long as Lessee is not in afault under Anicle XII, legal tttle to such Equipment Group and any and all repars, replacements, substitutions and modification to tt shall be in Lessee. Upon termination of this Lease wtth respect to any Equipment Group pursuant to Anicle XII, full and unencumbered legal title to such Equipment Group shall pass to Lessor, and Lessee shall have no funher interest therein. In etther of such events, Lessee shall execute and deliver to Lessor such documents as Lessor may request to evidence the passage of legal tttle to such Equipment Group to Lessor and the termination of Lessee's interest therein, and upon request by Lessor shall deliver possession of the Equipment Group to Lessor in accordance wtth Section 12.3. Upon termination of this Lease with respect to any Equipment Group through exercise of Lessee's option to purchase pursuant to Anicle X or through payment by Lessee of all Rental Payments and other amounts hereunder, Lessor's security or other interest in such Equipment Group shall terminate, and Lessor shall execute and deliver to Lessee such documents as Lessee may request to evidence the tennination of Lessor's security or other interest in such Equipment Group. Section 8.2. Security Interest. Lessee grants to Lessor a continuing, first priority security interest in and to the Equipment, all repairs, replacements, substttutions and modifications thereto or thereof made pursuant to Section 8.5 and all proceeds of the foregoing in order to secure Lessee's payment of all Rental Payments due during the Lease Term and the perfonnance of all other obligations herein to be performed by Lessee. Lessee will join wtth Lessor in executing such financing statements or other documents and will perform such acts as Lessor may request to establish and maintain a valid first lien and perfected security interest in the Equipment, If requested by Lessor, Lessee shall conspicuously mark the Equipment wtth appropriate lettering, labels or tags, and maintain such markings during the Lease Tenn, so as clearly to disclose Lessor's security interest in the Equipment. Section 8.3. Liens. During the Lease Term, Lessee shall not, directly or indirectly, create, incur, assume or suffer to exist any mongage, pledge, lien, charge, encumbrance or claim on or wtth respect to the Equipment, other than the respective rights of Lessor and Lessee as herein provided and Permitted Encumbrances. Except as expressly provided ''1 Section 7.3 and this Miele, Lessee shall promptly, at its own expense, take such action as may be necessary duly to <5Charge or remove any such mortgage, pledge, lien, charge, encumbrance or claim if the same shall arise at any time. Lessee shall reimburse Lessor for any expense incurred by Lessor in order to discharge or remove any such mongage, pledge, lien, charge, encumbrance or claim. CalfonUaleaae.Page 7 94291 Section 8.4. Installation of Lessee's Equipment. Lessee may at any time and from time to time. in its sole ';scretion and at rts own expense, install other rtems of equipment in or upon the Equipment. which rtems shall be .Jentified by tags or other symbols affixed thereto as property of Lessee. shall remain the sole property of Lessee. and may be modified or removed by Lessee at any time provided that Lessee shall repair and restore any and all damage to the Equipment resu~ing from the installation, modification or removal of any such rtems. Section 8.5. Modification of Eauioment. Lessee shall, at rts own expense, have the right to make repairs to the Equipment, and to make repairs, replacements, substitutions and modifications to all or any of the parts thereof. All such work and any part or component used or inslalled to make a repair or as a replacement, substrtution or modification, shall thereafter comprise part of the Equipment and be subject to the provisions of this Lease. Such work shall not in any way damage the Equipment or cause it to be used for purposes other than those authorized under the provisions of State and Federal Law or those contemplated by this Lease; and the Equipment, upon completion of any such work shall be a value which is not less than the value of the Equipment immediately prior to the commencement of such work. Section 8.6. Personal Property. The Equipment is and shall at all times be and remain personal property notwithstanding that the Equipment or any part thereof may be or hereafter become in any manner affixed or attached to or embedded in or permanently rested upon real property or any building thereon or attached in any manner to what is permanent by means of cement, plaster, nails. bolts, screws or otherwise. ARTICLE IX: WARRANTIES Section 9.1. Selection of Equipment. The Equipment and the Contractor have been selected by Lessee, and Lessor shall have no responsibility in connection wrth the selection of the Equipment, its suitability for the use intended by Lessee, the acceptance by the Contractor or its sales representative of the order submitted, or any delay or failure by the Contractor or its sales representative to manufacture, deliver or install the Equipment for use by Lessee. Lessee authorizes Lessor to add the serial number of the Equipment to Exhibit A when available. ,ectlon 9.1.2 Installation and Maintenance of Equioment. Lessor shall have no obligation to install, erect, test, inspect, service or maintain the Equipment under any circumstances, but such action shall be the obligations of Lessee or the Contractor. Section 9.3. Contractor's Warranties. Lessor hereby assigns to Lessee for and during the Lease Term, all of its interest, n any, in all Contractor's warranties and guarantees, express or implied, issued on or applicable to the Equipment, and Lessor hereby authorizes Lessee to obtain the customary services furnished in connection with such warranties and guarantees at Lessee's expense. Section 9.4. Patent Infrinaement. Lessor hereby assigns to Lessor for and during the Lease Term, all of its interest, n any, in patent indemnity protection provided by any Contractor with respect to the Equipment, Such assignment of patent indemnity protection by Lessor to Lessee shall constitute the entire liability of Lessor for any patent infringement by Equipment furnished pursuant to this Lease. Section 9.5. Disclaimer of Warranties. THE EQUIPMENT IS DELIVERED AS IS, AND LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDmON, MERCHANTABILITY OR RlNESS FOR ANY PARTICULAR PURPOSE OR RTNESS FOR THE USE CONTEMPLATED BY LESSEE OF THE EQUIPMENT, OR Am OTHER REPRESENTATION OR WARRANTY WITH RESPECT TO THE EQUIPMENT, IN NO EVENT SHALL LESSOR BE LIABLE FOR Am INCIDENTAL OR CONSEQUENTIAL DAMAGES IN CONNECTION WITH OR ARISING OUT OF THIS LEASE OR THE EQUIPMENT OR LESSEE'S USE OF THE EQUIPMENT. ARTICLE X: OPTION TO PURCHASE '>ection 10.1. When Available. Lessee shall have the option to purchase Lessor's interest in any Equipment Group n any Payment Date relating thereto for the then applicable Purchase Option Price set forth in the page of Exhibit A relating thereto, but only if Lessee is not in defau~ under this Lease, and only in the manner provided in this Article. CalifomiaLeaae.Page 8 "- / '4, ?~ i , . , j ection 10.2.' Exerci'se of Option. Lessee shall give notice to Lessor of its intention to exercise its option with ,aspect to any Equipment Group not less than thirty (30) days prior to the Payment Date on which the option is to be exercised and shall deposit with Lessor on the date of exercise an amount equal to all Rental Payments and any other amounts relating to such Equipment Group then due or past due (including the Rental Payment relating thereto due on the paymem Date on which the option is to be exercised) and the applicable Purchase Option Price set forth in the EquiprOent Schedule relating thereto. The closing shall be on the Payment Date on which the option is to be exercised at the office of Lessor. Section 10.3. Release of Lessor's Interest. Upon exercise of the purchase option with respect to any Equipment Group by Lessee, Lessor shall convey or release to Lessee all of its right, title and/or interest in and to the Equipment Group by delivering to Lessee such documents as Lessee deems necessary for this purpose. ARTICLE XI: ASSIGNMENT, SUBLEASING, MORTGAGING AND SELLING Section 11.1. AssiGnment by Lessoe Lessor shall not assign its obligations under this Lease, and no purported assignment thereof shall be effective. All of Lessor's right, title and/or interest in and to any Equipment Schedule, Equipment Group, the Rental Payments and other amounts due with respect thereto, and the right to exercise all rights under this Lease relating to such Equipment Schedule and Group may be assigned and reassigned in whole or in part tone or more assignees or sub assignees by Lessor at any time, without the consent of Lessee. No such assignment shall be effective as against Lessee unless and until the assignor shall have filed with Lessee a copy or written notice thereof identifying the assignee. During the Lease Term, Lessee shall keep a complete and accurate record of all such assignments. In the event Lessor assigns participations in its right, title and/or interest in and to any Equipment Schedule, Equipment Group, the Rental Payments and other amounts due with respect thereto, and the rights granted under this Lease relating thereto, such participants shall be considered to be Lessor with respect to their participated shares thereof, <;ection 11.2. AssiGnment and SubleasinG by Lessee. Neither this Lease nor Lessee's interest in an .quipment Group may be sold, assigned, subleased, transferred. pledged or mortgaged by Lessee without the written consent of Lessor. However, Equipment may be subleased by Lessee to a State agency or other political subdivision for the performance of essential government services by such agency or subdivision without the consent of Lessor, provided that: (a) this Lease and the obligation of Lessee to make Rental Payments hereunder. shall remain obligations of Lessee and (b) the sublessee assumes the obligations of Lessee under the Lease with respect to the Equipment subleased. Lessee shall immediately furnish to Lessor a true and complete copy of such sublease. No sublease shall cause the interest component of the Rental Payments due with respect to the Equipment Group to become includable in gross income of the recipient for federal income tax purposes, ARTICLI:, XII: EVENTS OF DEFAULT AND REMEDIES Section 12.1 Events of Default Defined. The following shall be "events of default' under this Lease with respect to any Equipment Group and the Equipment Schedule relating thereto, and the terms "events of defaui!' and "default' shall mean, whenever they are used in this Lease, with respect to any Equipment Group, anyone or more of the following events: (a) Failure by Lessee to pay any Rental Payment or other payment required to be paid under this Lease with respect to any Equipment Group at the time specified herein and the continuation of said failure for a period of three (3) days. (b) Failure by Lessee to observe and perform any covenant, condition or agreement on its part to be observed or performed with respect to any Equipment Group. other than as referred to in Clause (a) of this Section, for a period of thirty (30) days after written notice specifying such time prior to its expiration; provided, however, if the failure stated in the notice cannot be corrected within the applicable period, Lessor will not unreasonably withhold its consent to 'in extension of such time if corrective action is instituted by Lessee within the applicable period and diligently pursued .ntil the defaui! is corrected. (c) The determination by Lessor that any representation or warranty made by Lessee in this Lease was untrue in any material respect upon execution of this Lease or any Equipment Schedule. CaJitomialease.Page 9 : 94.,2.91 I' (d) The filing by Lessee of a voluntary petition in bankruptcy, or failure by Lessee promptly to lift any (ecution, garnishment or attachment of such consequence as would impair the ability of Lessee to carry on its dovernmental functions of adjudication of Lessee as a bankruptcy, or assignment by Lessee for the benefit of creditors, or the entry by Lessee into an agreement of composition with creditors, or the approval by a court of competent jurisdiction of a petition applicable to Lessee in any proceedings instituted under the provisions of the United States Bankruptcy Code, as amended, or under any similar acts which may hereafter be enacted, An event of default with respect to one Equipment Group shall not constitute an event of default with respect to any other Equipment Group. Section 12.2. Remedies on Default Whenever any event of default referred to in Section 12.1 shall have happened and be continuing with respect to any Equipment Group, Lessor shall have the right, at its option and without any further demand or notice, to take one or any combination of the following remedial steps: (a) Lessor, with or without terminating this Lease with respect to such Equipment Group, may collect each installment of Rental Payments as it becomes due and payable in accordance with the related Equipment Schedule, (b) Lessor, with or without terminating this Lease with respect to such Equipment Group, may repossess the Equipment Group by giving Lessee written notice to deliver such Equipment Group to Lessor, whereupon Lessee shall return the Equipment Group in the manner provided in Section 12.3: or in the event Lessee fails to do so within ten (10) days after receipt of such notice, Lessor may enter upon Lessee's premises where the Equipment Group is kept and take possession of the Equipment Group and charge Lessee for costs incurred in repossessing the Equipment Group, including reasonable attorneys' fees, Lessee hereby expressly waives any damages occasioned by such repossession, Notwithstanding the fact that Lessor has taken possession of the Equipment Group, Lessee shall continue to be responsible for the Rental Payments due with respect thereto as and when such Rental payments become or would have become due and payable, If this Lease has not been terminated with respect to such Equipment Group, Lessor shall 'eturn the Equipment to Lessee at Lessee's expense when the event of default is cured. (c) If Lessor takes possession and disposes (whether by sale, lease or otherwise) of such Equipment Group or any portion thereof, Lessor shall apply the proceeds of any such disposition to pay the following items in the following order: (i) all costs incurred in securing possession of the Equipment Group; (ii) all expenses incurred in completing the disposition; and (Iii) the balance of any Rental Payments with respect thereto as and when such Rental Payments would have become due and payable. Any disposition proceeds remaining after the requirements of Clauses (i), (ii) and (iiQ have been met shall be paid to Lessee. (d) By action pursuant to the California Code of Civil Procedure, or as otherwise provided by law, for the issuance of a writ of mandamus enforcing, for the entire balance of the Lease Term, ;;',,:, dL1y of Lessee to appropriate and take all other administrative steps necessary for the making of Rental Payments. (e) Lessor may take any other remedy available al law or in equity with respect to such event of default, including (without limitation) those requiring Lessee to perform any of its obligations hereunder or to pay any moneys due and payable to Lessor hereunder, provided Lessor shall have no right to accelerate Rental Payments or otherwise declare any Rental payments not then in default to be immediately due and payable. Section 12.3. Return of EouiDment. Upon the expiration or termination of this Lease with respect to any Equipment Group prior to the payment of all Rental Payments in accordance with Exhibit A, Lessee shall return such Equipment Group to Lessor in the condition, repair, appearance and working order required in Section 7,2, in the following manner as may be specified by Lessor: (a) by delivering the Equipment Group at Lessee's cost and expense to such place within the Stale as Lessor shall specify; or (b) by loading such portions of the Equipment Group are considered movable at Lessee's cost and expense, on board such carrier as Lessor shall specify and shipping the same, freight prepaid, to the place specified by Lessor. If Lessee refuses to return the Equipment Group in the manner designated, '.essor may repossess the Equipment Group and charge to Lessee the costs of such repossession nor pursue any 3ITledy described in Section 12.2. CalifomiaLease.Page 10 94 211 . Section 12.4. No Remedv Exclusive. No remedy conferred upon or reserved to Lessor by this Article is intended ) be exclusive and every such remedy shall be cumulative and shall be in add~ion to every other remedy given under this ~ease. No delay or omission to exercise any right or power accruing upon any defautt shall impair any such right or power or shall be construed to be a waiver thereof but any such right and power may be exercised from time to time and as often as may be deemed expedient by Lessor or its assignee. Section 12.5. A9reement to Pay Attornevs' Fees and Expenses. In the evem e~her party to this Lease should defautt under any of the provisions hereof and the non defautting party should employ attorneys and/or incur other expenses for the collection of moneys or for the enforcemem of performance or observance of any obligation or agreemem on the part of the defautting party herein comained, the defautting party agrees that ~ will on demand therefor pay to the non defautting party the reasonable fees of such attorneys and/or such other reasonable expenses so incurred by the non defautting party. Section 12.6. Late Charae. Whenever any event of defautt referred to in Section 12.1, Clause (a) shall have happened and be cominuing w~h respect to any Equipmem Group, Lessor shall have the right, at its option and w~hout any further demand or notice, to require a late paymem charge for each thirty (30) day period or part thereof during which such evem of default occurs equal to four percem (4%) of the delinquem amoum, and Lessee shall be obligated to pay the same immediately upon receipt of Lessor's written invoice therefor; provided, however, that this Section shall not be applicable if or to the extem that the application thereof would affect the validity of this Lease. ARTICLE XIII: ADMINISTRATION PROVISIONS Sectian 13.1. Natices. All notices, certificates, legal opinions or other communications hereunder shall be sufficiemly given and shall be deemed given when delivered or depos~ed in the Un~ed States mail in registered form w~h postage fully prepaid to the addresses specified on the execution page hereof; provided that Lessor and Lessetl, by notice given hereunder, may designate differem addresses to which subsequem notices, certificates, legal opinions or other communications will be sent. Sectian 13.2. Financial Information. During the Lease Term, Lessee annually will provide Lessor with current financial statements, budgets, proof of appropriation for the ensuing Fiscal year and such other financial information relating to the ability of Lessee to cominue this Lease as may be requested by Lessor or ~s assignee. Section 13.3. Blndina Effect. This Lease shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. Section 13.4. Severability. In the evem any provision of this Lease shall be held invalid or unenforceable by any court of competem jurisdiction, such hoiding :;i,a1i no invalidate or render unenforceable any other prc..-isic;; ~cr::of. Section 13.5. Amendments. Chanaes and Modifications. This Lease may be amended or any of its terms modified only by written document duly authorized, executed and delivered by Lessor and Lessee, Section 13.6. Caations. The captions or headings in this Lease are for convenience only and in no way define, Iim~ or describe the scope or iment of any provisions, Articles, Sections or Clauses of this Lease. Section 13.7. Further Assurances and Corrective Instruments. Lessor and Lessee agree that they will, from time to time, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, such supplernems hereto and such further instruments as may reasonable be required for correcting any inadequate or incorrect description of the Equipmem hereby leased or intended so to be, or for otherwise carrying out the expressed imention of this Lease. Section 13.8. Execution in CounterDarts. This Lease may be simultaneously executed in several coumerparts, each of which shall be an original and all of which shall constitute but one and the same instrumem, Section 13.9. ApDlicable Law. This Lease shall be governed by and construed in accordance w~h the laws of the State of California, CaJifomiaLeaae.Page 11 94-291 , . Section 13.10. Financino Statement. A carbon, photographic or other reproduction of this Lease or of any lancing statements signed by Lessee is sufficient as a financing statement in any state to perfect the security interests >lranted in this Lease, Section 13.11. Usurv. It is the intention of the parties hereto to comply with any applicable usury laws; accordingly, it is agreed that, notwithstanding any provisions to the contrary in this Lease, in no event shall this Lease require the payment or permit the collection of interest or any amount in the nature of interest or fees in excess of the maximum amount permitted by applicable law. Any such excess interest or fees shall first be applied to reduce Principal, and when no Principal remains, refunded to Lessee. In determining whether the interest paid or payable exceeds the highest lawful rate, the total amount of interest shall be spread through the Lease Term so that the interest is uniform through such term. ARTICLE XIV: ADDENDA TO LEASE Section 14.1. Addenda. The addendum or addenda checked on the execution page hereof are attached hereto and made a part hereof. Date of Lease: FI5ClII Year Commencement Date: FI5ClII Year Ending Date: Addenda. The following addendum or addenda which have been checked are attached hereto and made a part of this Lease: Addendum for Escrow Funding Addendum for Self-Insurance Addendum for Environmental Provisions Special Addendum There are no addenda to this Lease, IN WITNESS WHEREOF, Lessor has caused this Lease to be executed in its corporate name by its duly authorized officer, and Lessee has caused this Lease to be executed in its name by its duly authorized officer, LESSEE: LESSOR: First Public Finance 5800 E. Skelly Dr., Tulsa, Oklahom Corporation uite 1200 4135-6416 BY~ ~~ . Title:~'-,rl, &~ 'i .~~ SEP 2 9 19 4 Date: By: , ~'----ritle: Date: lo~ L/-9t./ CalifomiaLease.Page 12