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CITY OF SAN BERN~DINO - REQUEST F~ COUNCIL ACTION
. BARBARA PACHON MASTER CONTRACT FOR
From: DIRECTOR OF FINANCE Subject: KOCH FINANCIAL CORPORATION
Dept: FINANCE/PURCHASING
Date: AUGUST 10, 1994
Synopsis of Previous Council action:
09/21/94 - RECOMMENDED FOR APPROVAL BY WAYS & MEANS COMMITTEE
Recommended motion:
ADOPT RESOLUTION
~L/ d;j;~
/ Signature
~ntect person:
BARBARA PACHON, DIRECTOR OF FINANCE
Phone:
x - 5242
>upporting data etteched:
Ward:
:UNDING REQUIREMENTS:
Amount:
Source: (Acct. No.1
(Acct. DescriDtionl
Finance:
: :ouncil Notes:
5-0262
Agenda Item No / tJ
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CITY OF SAN BERNARDINO - REQUEST FOR COUNCIL ACTION
STAFF REPORT
The proposed action is to add a Lease Purchase Master Contract with
the city of San Bernardino. This will add to our library of
financing partners which currently includes Associated Commercial
Corporation, Access Public Funding, G.E. Capital, MLC Group,
Pacific Atlantic, MMC Government Finance, city corp North America,
Ford Motor Credit Co., Security Pacific Leasing and Pacificorp.
This will reduce the processing time in Lease Purchasing
Transactions.
It is requested that Council approve Koch Financial Corporation for
Lease Purchase Master Contract.
Koch Financial corporation
4111 East 37th Street North
Wichita KS 67220
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1 RESOLUTION NO.
2 RESOLUTION OF THE CITY OF SAN BERNARDINO ACCEPTING LEASE
PURCHASE MASTER AGREEMENT FOR KOCH FINANCIAL CORPORATION, FOR THE
3 FURNISHING OF LEASE PURCHASE FINANCING.
4 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AS FOLLOWS:
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SECTION 1. That Equipment Lease-Purchase Master Agreement
with Koch Financial Corporation (the "Agreement"), a copy of which
is attached hereto and incorporated herein as Exhibit "A", is
approved by the City of San Bernardino for the furnishing of
Lease-Purchase Financing; pursuant to this determination, said
Master Lease-Purchase Agreement by the Mayor of the City of San
Bernardino.
SECTION 2. The city shall not be obligated under the
Agreement unless and until the Agreement is fully executed and no
oral agreement relating thereto shall be implied or authorized.
The authorization to execute the above referenced Agreement is
rescinded if the parties fail to execute it within sixty (60) days
of the passage of this resolution.
SECTION 3.
No transactions shall be initiated under the
Master Lease contained in the Agreement without the approval of
the Mayor and Common council.
SECTION 4. The City shall not be obligated until a lease-
purchase schedule transaction for material, equipment, supplies or
contracted services is executed with the vendor under this
Agreement.
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RESOLUTION OF THE CITY OF SAN BERNARDINO ACCEPTING LEASE
PURCHASE MASTER CONTRACT FOR KOCH FINANCIAL CORPORATION FOR THE
FURNISHING OF LEASE PURCHASE FINANCING.
SECTION 5. The Purchasing Agent, Director of Finance and the
City Attorney are hereby authorized to execute such documents as
necessary for the administration of transactions under the
Agreement.
I HEREBY CERTIFY that the foregoing resolution was duly
adopted by the Mayor and Common Council of the City of San
Bernardino at the
meeting thereof, held on the
day of
COUNCIL MEMBERS
, 1994, by the following vote to wit:
AYES
NAYS
ABSTAIN
ABSENT
NEGRETE
CURLIN
HERNANDEZ
OBERHELMAN
DEVLIN
POPE-LUDLAM
MILLER
CITY CLERK
of
The foregoing resolution is hereby approved this
, 1994.
day
Approved as to form
and legal content:
Tom Minor, Mayor
City of San Bernardino
JAMES F. PENMAN
City Attorney
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No.
EQUIPMENT LEASE/PURCHASE AGREEMENT
DATED:
NAME AND ADDRESS OF LESSOR
Koch f"......w CorponIioo
41 I I Eat 37th _ Noo1h
Wichita, KS 67220
NAME AND ADDRESS OF LESSEE
Quantily
Deocriplton
DESCRJPTION OF EQUIPMENT
Modcl#
ScrialN
LocaIionof~
RENTAL PAYMENTS
RenIaI Pa~ _ ....11 be (1lIOlIIhIy) (quortorIy) (_) (......). _I PaynlOlU ....11 be mode 1ft _ WlIIl _ 4.01 and .... ScboduIe of RenIaI
PaynlOlU__uExhib.A. ThemoximumLcueTennofthia~is yeonand ..........
TERMS AND CONDITIONS
THE TERMS AND CONDITIONS OF THIS AGREEMENT SET FORTH ON PAGES TWO THROUGH
FIVE SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE.
IN WJnIESS WHEREOF. Lcaor and Lessee have callIeCIlIlis ~ to be executed in Iheir....... by Iheir duly.uthorized.........,..u... u or......... wnllal
above.
(LESSOR)
Koch f"......w CorponIioo
(LESSEE)
By
By
TIde
Title
(SEAL)
ATTEST:
Title:
CERTIFICATE OF CLERK OR SECRETARY OF LESSEE
I ...... ........ ~ on ....... Ii....... appean
Ihereon, is .... duly and ...... olf_ of Lessee u ...... _ bis .. her Ii....... and baa been aulhorized to ............ fonaoina ~ on _ oft-,
and (ii) thal.... budplyar of Lessee is _ to
Datod:
By
Tille:
OPINION OF COUNSEL
Iw IepI _ to t-, I have -.::= (.) .... -. ~ wbich, amona ocher Ill..... pnmdol r.. .... _ to and .......- by .... Lessee of the
~ (b) aD executed -..port of.... ~...__ .. I<OOIUlio.. of Lessee which, ~ _Ihinp, auIhorizco Lessee to ........ .... ~ and (.) ..... -
__ .....__ofJawu lha"_-r in.....-;... with.... rollowin&opinionL _ on.... fin&oina.l am of.... roIlowin&opinionI: (I) ~
is. publiobodyCOlpOlOlaand poIilio, duly orpnizod and -a""'" the ..... or.... SCale, and liu .1UbotanliaI........ ofone....... of.... rollowina_.. _ (.)
.... ........to_ (b).... ........of_ domain, and(.) police powa; (2) ~ baa the "-_........and authorityto.......-.... Equ~and to........ and_....
~ and to,..rom ifa obIiplionl........... ~ (3) the ~ and.... _.................... __.......... nquiraltbanin have been duly aIIIIIoriDd,
~ and.......... by and 00 _oft-, and.... ~ is. valid and bindins obIiplion of Lessee _ ill _ with ifa __ (4).... auIhorizalion,
~ and _ of.... ~ and all ocher proc:oedinp of Lessee maUna to the ............ ............... tbaroby have been pcdoomed ill . ..... with a11_
..-intI...... p1b1io biddin&..... and all ocher applicable..... and r......I.._ and (S)...... is no ............ pcndina.. thraIenod ill any..... .. boron any ........-.1
authority.. arbiInlion -.I.. In'bunallhal, if _Iy cleterminod, .....1eI _Iy aired ................ _laIcd by.... ~...... aoouriIy""" ofLcaor..
ifa _.... u .... cue may be, in .... EquipnMm. All c:apflaliad ....... heroin ....11 have the ...... meaninp u in the r.....ina A&reemooL Lcaor. ifa ... . and usi....
indudina without limilalion any RqistcraI Ownen, and any......1 nndorinc an opinion on the tax.......,. ...... of the ...... COI'_'" of RonIaI Pa)'lllGdS lie enliUed to
rely on thia opinion.
Printed Naaw: ~ It "I'll. J: A. '8 . ~ ,. ....J
Adlha: 8'0..J......;) '7r4'"
~... ~~.~" t'A 9.><111-
T...,.,....No.: 0-" JW.r:.rr
DaIcd: A"'t/" .10. I r~v
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ARTICLE I
Sec:ti.on 1.01. Deftnltio-. The following tenns will have the meanings indicated below unless the context clearly requires otherwise.
. AacnI. ...... any __ for.... ResiJl<red Ownen, if any. to lNhich.1I '" . portion oC Lcsoor'. ris/1~ titl, and in_ in, to and undoor this Asr<anenl and.... Equi..-u may be
&DipodtGr.... benefit oC.... ResiJl<red Owners.
.~. ...... paps one -Ih li.. oC this Equipm<nl LeascJPun:buc Ap<emenI, .... Tax Daipti... and Co_ and any other sc:hodul., ..nibit '" escrow
..- made. put henofby.... putieo hemo,loI<lh<< with any amendmenta to.... Asr<anenl made punuanl to Sectioo 13.06.
"Code....... the INa1IaIRewnuo Code of 1986.
"C4:lmrrK~ncD Date" is the date when the term of this Agreement and Lcucc'a obligation to pay rent ........_nccs. which date shall be the earlier of (i) the date on which the
Equipment ia a=pl<d by IMoee in............. ilaaibod in Soction 5.01. '" (Ii) the daIc 00 which sulfid...1IlIlI"Y' to purc:hue.... Equipment are depooit<d C'" thai
.Equ~":' == =bod 00 .... '- of this Apecmmt and .11 ""I........ts, rq>aira, _i.... modificati... and impso......... thereoC", thereto made
punuanl to Ai1ici1e VIII.
.Event ofDefauIl....... an EventoCDefauIl dacribod in S<c:lioo 12.01.
.Leue Patlicipolioo Cenif............. <atif...... <Viclencin8' rishllo ncoi... pro rata share oCRental P.yments and Purc:hue Pric:e payments.
.Leue Tam........... Oripl Tam and.1I R.......I T......
.1Moee........... entiIy _ u ouch 00 the fionI of this Ap<emenI, i.. su_ and i.. &Dip.
.Lasor"...... the entiIy _ibod u such 00.... '- oCthis ^-"' ita """""'" and i.. usip.
"OriJlinal Tam....... the period _.... c...._ 0.1e Wllil.... end of.... budp ~ oflMoee in elfecl.t.... C....._ Dale.
"PUIcbue Price....... the..- deoipatod u ouch 00 Exhibit A....... thallMoee may. '" i.. diacrelioo, pay to Loaor to purc:hue.... Equipment.
.ResiJl<red 0..-.. .......... resiJtond........ ofLeue Participalioo c.rtiCtcates.
"Renewal T............ the renewal...... of this ~ ...h haYin8' duration oCone year and . tam............ with Leuee', budsct year.
_ PaYR**"""" the buic.....1 payments payabl. by IMoee punuanl to Soctioo 4.01.
.RentaI Payment Period" ...... .... period besinnins 00 .... day . Ren..1 P.yment is due and ending.... day beC"" .... next Rental Payment ia due. The CUll Renta1 Payment
Pariod.....1 bqin 00.... c............... Dato in .11...... 1fRenta1 Payment Perioda are monthly. su"",u'" _I P.yment Perioda .....1 bqin 00.......... day of
_ mooth after.... Commenc:ema. 0.1e. IC _I Payment Perioda are quarterly. suboequ'" R....I P.yment Perioda ....11 bepn 00 .... ...... day of - third
..- after.... c........_.... Dale. If Rental P.yment Perioda are _i~ IUbocquenl Rental Payment Perioda ""11 bqin 00 .... ...... day of _ sixth mooth
after.... c..._..-nent Dale. If Rental Payment Perioda are ......~ ........u... Rental Payment Perioda....1I bqin 00 .... ....iwnary oC.... eo......_ Dato
in _ year. If the Commc<_ Dato is.... 29th, 30th '" 3111 day oC .1ROIIIh, any suboequ'" Rental Payment Period thaI.....1d oIherwiac bqin 00.... 29th,
30th ew 3111 ofa..- thai does ... include ouch. dale",,1I bqin on....1ul day of.... month.
"Stale".... the.... in which u.ee is IocaIed.
"Tax Daillft&liooo and Covenanta........... _ ...itled "Tax Daignati... and Covenants,. if any. ......Ied by IMoee and --
.Vendor".......... manu/iu:lURr of.... Equipment u...1I u.....senta or dealers of.... numufadum Crom INhe<n Loaor purc:hued '" ia purdwins.... Equipment.
ARTICLE II
Section 1.01 Reprnentatlons and Connan.. 01 J..e.uH. Lessee rcprescnu. covenants and wamnta for the benefit of Lc:sIor and any Regislcrcd Owners (aa
heRinbefore defined) u foIlow1:
(a) IMoee is a public body <XIIJIClr&Ie and politie duly cwganizod and .xiIling undoor.... c:ooIlilUlioo and Ia_ of.... S.... with lUll power and authority to enter into this
~ and.... uantaCli... <XlIIIcnlpIatod hereby and to perform all ofi.. obliplions hemuIder.
(b) IMoee baa duly autIloriz<cl.........roon and delive<y oCthis Asr<anenl by proper aetion by ita sowming body at . _ing duly ..lied, rogularly...._ and
attondecl_st-t by.... nquisiIe maior!'>.' oC.... memben.......C '" by other appnIpriato oWid.1 approval. and .11 roqui_ ha.. been "'" and proc:edura ha.. ..........
in order to ............ validity and onfe<eeabdity of this Ap<emenL
(e) No..... '" eondilion thaI_ "'with.... giYin8ofnolic:e "'....1_ oCtime "'both.....ld............ an Event ofDeC.ull exiata at.... daIc hereof.
(d) IMoee has, in __ with.... nqui_ oflaw.lUlly budscted and appoopriatod suffi...... fUndo C"'............ budp year to make.... Rental P.ymonta
_led to.... dua durins.... OriJlinal Term, .... to..... i.. other oblipli... C"'.... Oripl Term, and ouch fUndo ha.. nol been expended C'" other_
(e) IMoee will do "'...... to be done all thinp -rr to..-.. and keep in IUII_ and elf... ita.......... u. body <XIIJIClr&Ie and I"'lilie.
(I) Laue.... eompIied with ouch publie biddinJ! requirementa u may be opplic:abl. to this "-""" and.... aequisilion by IMoee of.... Equipment.
(J) DuriDc .... Leue Term, .... Equipment will be uoed by IMoee only C'" .... purpooe oC performing .........1 .............1 '" proprietary IU""'", of IMoee
lXlIlIiIlent with.... permissible oflMoee', authority.
(11) IMoee will :: provide Laue with ........ CIIl&IIciaI ............ bud.... proofS oC approprialion C'" .... .....ins budp year and such other flll&llcial
informal... reIatins to.... ability otlMoee fA) eoolinue this ~ u may be l'e<Jl'OIIed by Loaor.
(i) IMoee will <XlIIIJlly with .11 .pplicabl. provisions of.... Cod<, inc:luding ~llimi..lion Sections 103 and 148 thereot and .... opplic:abl. rogul....... of....
Treasury o.eo!'-" to _.....xdusioo of............. _.......... of Rental P.ymonta _ ..... ineome eo. purpooa offederal ineome taxation.
(j) IMoee will ....... proceedo of this ~ u.... u prac:ticabl. and with all reuooabl. dispatch f", .... pu"",",, f", lNhich .... "-""" baa been entered
into. No put of.... proceedo of.... ~.....I be ......... in any oecuri...... obliplions ew other in_ "'....... an any lime, cIirec:tly '" indirec:lIy. in. ......... which, if
ouch.... had been ~ anlieipaled on.... daIc of_ of.... Ap<emenI, .....Id ha.. c:auaed any portion of.... "-""" to be '" _ .ubi..... -. within....
.......... ofSectioo 103(b)(2) ew Section 148 oC.... Code and.... opplicable rogulalioos of.... Trouury ~
Sectioo 2.02. Ce_.. to Arllltn... IMoee hereby.......... u Collowl:
(.) The _ ~...... of.... Equ......... willnol be ...._.... ~ princ:ipa1....... of.... Rental Payments.
(b) nO ~.... been ....... ew is expeered to be....... within aix montho of.... C~...__ Dale. and.... Equipment ia expeered to be deli...... and
......1Ied, and.... vcncIoi IUIIy paid, within one year of.... C~......_.._. Dato.
(e) Laue baa'" CnatecI '" _ished. and does nol eXJNd to....... '" _b1ish, any sinking fimd '" other similar IUncI (i) thai ia reuooably expeered to be uoed to
pay.... Rental Pa~ ew (ii) thai may be uaed aoIely to praventa defaull in.... payment of.... Rental Payments.
(d) The Equ......... bu... been and ia nol expeered to be aoId '" oIherwiac dispooed oCby 1Moee. alba- in _I. '" in mai'" part, prior to....1ul maturity oC....
Rental P.,.(.) ~o.... bell ofLeuee'l know1edge. informatian and belie/; .... &bo.. expecIaIi... are reuonabIe.
(I) IMoee baa'" been noIiIied of any liIlin8 '" ...........Iisting of it by the Internal R...... Scrvic:e u an issuer whooe arbitrage -.-ficalelmay'" be ..lied upon.
ARTICLE III
Sec:lioo 3,01. I.-e orEqulpmeat. Loaor hereby ~ 1_ and Ieta to 1Moee, and 1Moee............ and hireo li'om Loaor. .... Equipment in -- with
this ~ Cewthe Leue Tam. The Leue Tam may be eonIinued.lOl.ly at.......... ofLeue<. at the.... of.... Oripl Tam '" any Renewal Tam for an adcIitiooaI
Renewal Tam up....... maximum Leue Tam. AI........ of.... Oripl Term and .1.... end oC_ Renewal Term lUllil.... maximum Leue Tam bu been eompIeIad, IMoee
.....1 be deemed to ha.. __ iIa opIian to c:onIinue this ~ f"'.... next Renewal Tam unIealMoee....1I ha.. taminatod this ~ punuanl to Sectioo 3.03 '"
purc:hued.... equi..... punuanl to Sec:Iioo 10.01. The...... and eooditions durins any Renewal Term ....11 be.......... u.... terms and eonditi... during.... OriJlinal Term.
exc:epl thai.... Rental Parn-*....II be u provided on Exhibit A........
Sec:Iioo 3.02. C..tlnual.... on..... Tenn. IMoee inIends. IUbjed to Sedion 3.03. to c:ontinue the Leue Term Ihroulh .... Original Term and .11 Renewal Tenns
md to pay the Rental Paymenll hereunder. L.cuee raaonably belicYCI that leplly available fundi in an amounlsuflic:ient to make III RcnIIl 'aymenta during the entire Leuc:
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'fam can be obtained. LesIee t\uther intends 10 do.11 thinI' lawfully within its power to obtain and maintain funds from which the Rental PaymentJ may be made. including
making provision for such payments to the extent nccaury in each budget or appropriation request submiucd and adopted in aecordance with applicable provisions of law, to
have such portion oCthe bwIpt or appropriation requat approved and to exhaust all.vail.ble revi.:ws and appeals in the event sucl1 portion of the budget or appropriation request
is not approved.
Sec:li... 3.03. N_ppro,_ !.alee is obIiptcd ...Iy to pay ..c:h R....I P.ymmlI under IhiI ~ .. may lawfUlly be I11Ide fi'om funds budpIod ODd
appI1IIl<iaIed for thol ....- durina !.aIee~ ..... ....... budpt~. Should !.alee fail.. bud.... -.;... or olherwise maIcc .vailable fimds .. pay RcnIaI Paymmll
foIlowin& tbe... ....... Ori..... 'tcnn or R..-I Term, IhiI Ajp<emenl..1I be deemed lem1inaIecIaI tbe end oftbe..... c:unent Oripl Tcnn or Renewal Term. !.alee
_to deli__ to [,.., of_ terminoli... alIcaaI90 days prior.. tbe end orthe ..... c:unent Oripl Tcnn or Renewal Term, but r.ilure to give _ notic:c "II not
....... tbe term beylXId _ Ori..... Tcnn or R..-I Term. Iflhil Ajp'eemenl is tcnnina1cd in aecordance with IhiI Sedi.... !.alee ._to peaceably deliver tbe Equipment
.. Laaor aI tbe 1ocaIion(1)" be apecif.... by Laaor.
Sec:li... 3.04. N__ To tbe __ pcrmi11cd by I.w, !.alee ._ thol iflhil Ajp'eemenl is termina1cd in aecordance with Sec:li... 3.03 !.alee will not
~ I.... or'"'!'..,..~ perfcoming _ aimll.. to 1hoae performed by tbe Equipmenl for I period of9O days followin, tbe end oftbe..... curren\ Originol Tcnn or
Renewal Term; provided 1hiI_"1I not be applicable in the event the Equipment"lI be aoId, re-Ieaacd or othcIwiac d'-" ofby Laaor ODd tbe __ rcoeived fi'om
_ ~ition, 1....11-. of_1Iic or dispoaili.... is ..mcicnt.. pay the then Ipplicable Purc:haac Price. This Sedi... ..1I.....in an full f.... ODd __g
tbe.........tiOIloflhil~
ARTICLE IV
_ 4.01. RcBtoI PayaMala. !.alee ahaIl promptly pay _I P.~ exdUlively fi'om lqally lvailable Iianda, in IawfUllIIOIII)' of the United StaIca of
Amorica to Laaor... tbe c......__.... Date ODd... the fUlt day of cadi RcnIaI P'ymcnI Period _, in _........ .. deaaibcd ... Exhibit A"""" !.alee ahaIl pay
Laaor......... any RcnIaI Payment not paid... the daIc _ payment is due.1 the _ of 111% per annum or the maximum IIIIClUlll pcnnit1cd by law, whi_ is lea, fi'om
_ daIc. A porti... of cadi RcnIaI Paymcnl is paid... ............ payment o( ~ .. act for1h... Exhibit A........
Sec:li... 4.02. _Pay1acllIa 10 Coaalltute. CUrrent E.,..... oflAaaec. Laaor ODd !.alee undenland ODd intend thol the oblipti... of!.alee to pay RcntaI
Paymenll hereunder lhall constitute. c;:ummt eJq)CfIU ofI..euee and _II not in any way be construed to be. debt of Lcsscc in contravention of any applicable constitutional or
IlaIlIIory limilalion or requirement eonc:cming the .....i... or _ by !.alee, nor shall anything .....incd ....... c:onaIilute. pledge of the gencnllaX.......... fimds or
monoya of!.alee.
_ 4.03. RENTAL PAYMENTS TO BE UNCONDITIONAL. E.'\:CEPT AS PROVIDED IN SECTION 3.03. TIlE OBUGATlONS OF LESSEE TO
MAKE RENTAL PAYMENTS AND TO PERFORM AND OBSERVE TIlE OTIlER COVENANTS AND AGREEMENTS CONTAINED HEREIN SHAlL BE
ABSOLUTE AND UNCONDmONAL IN ALL EVENTS WITHOlJr ABATEMENT, DlMIN1.TI10N. DEDUCTION, SET.QFF OR DEFENSE. FOR ANY REASON.
INCLUDING WlTHOlJr UMITATlON ANY FAILURE OF TIlE EQUIPMENT TO BE DELIVERED OR INSTALLED. ANY DEFECTS, MALFUNCTIONS,
BREAKDOWNS OR INF1RMlTIES IN TIlE EQUIPMENT OR ANY ACCIDENT, CONDEMNATION OR UNFORESEEN CIRCUMSTANCES.
ARTICLE V
Sedion '.01. DcIIv..,..I_ and A........... oft'" Equlpmcnl. Lcaec shall ordea.... Equipment, c:a... tbe Equipment 10 be deliveral ODd ~lIcd aI tbe
Ioc:au... apeoiIicd... tbe _ oflhil ~.... pay any and.1I delivery ODd i_llali... -. in _i...lh<rewith. When tbe Equipmenl baa been deliveral.... ~1Icd,
!.alee shall _aIcly....,. tbe Equipment ODd evidence aaid __ by .......ing ODd delivering to Laaor an __ certificate acccpIabIc.. Laaor.
Secti... '.02. EaJo1mcnl or Ill!ulpmenl. Laaor shall provide !.alee wilb quiet ... ODd cojoymcnl of the Equipment during the Leaac Term. .... !.alee ahaIl
peaceably and quietlr ha... hold ODd..oy the Equipment during tbe Leaac Term, without ..i~ trouble or hindrance fi'om Laaor, ......... olherwise _Iy act for1h in IhiI
AgreemcnI. No Rcgisterod Owner shallintert'eto wilb _ quiet ....... cojoyment durin, tbe Leaac Tcnn aol...g.. Lcaec is not in der.ull under Ibis AgreemcnI.
_ '.03. ~............. Once iI1IIallcd, the Equipmenl will not be moved fi'om tbe loc:aIioo apeoiIicd ... the fi'om of IhiI Agreement without ~
...-. which __ ahaII not be lIlll'CIOOIlabI wiIhhcId. Laaor shall have the richlal .1I........bl. timca durinc....1ar busi..... hou.. to...... into ODd UpOIl the Jl'-'Y of
!.alee for tbe....- ofinapoclinc the Equipmenl.
_ '.04. UN .... MaInt_ or the lll!ul.......L !.alee will not ~I~ .... .,.- or mainlain the Equipment improperly, c:areIculy, in violatiOll of any
opplicable law or in. _ c:onlnIylo thol conIOInfIIa1cd by IhiI ~ !.alee shall provide all permita ODd Iiccnaoa, if any. .........,. ror tbe ~lIa1i... .... ~ of
the Equ;p-o. In addition, Lcaec _to eomply in all ........ with .11 oppIic:abl. I..... ....lali.... .... rulinp of any legislati... ......u... odminislralive or judicial body;
providoci thol Lcaec may"'- in ...... faith the validity or oppIic:ation of any _ law, ....1atiOIl or ruling in any _ _ thol doea noI, in the opinion of Laaor,
adverseIy'- the __ ofLaaor in ODd.. the Equipment or.. intereat or rishU under IhiI ~ Lcaec ..... thol il wil~ aI ~ own .... .... -.
mainaain, ..-w and keep the Equipment in good repair 'and workinc order. I..cuor shall have no rapo..ibi~lo mainlain. repair to make ;"'.........cmcntl or additions to the
Equipmenl. UP'"' tbe........ ofLaaor, Lcaec will ...... into. mai................. for the Equipment with V .
ARTICLE VI
_ 6.01. TIt1c to 1...lll!ul......... UP'"' __ of the Equipmenl by !.alee, Ii'" to the Equipmenl ahaIl _ in !.alee aubj..... ~ richU under IhiI
ApaacnI; provided thollitlc ahaIl_ immedi.teIy.... without any ..xi... by !.alee _ in Laaor, .... Lcaec shall immediately............ poaaeaai... orthe Equipment ..
Laaor upon (.) any tenninaIion oflhil Agreement _ than tenninaIion punuant :0 Sedion 10.01 or (b) the - -co of an E_ of Default. It is tbe intent oftbe putiea
_ thol any _ of IitIc to Laaor pursuant to IhiI _ ahaIl ...... lutomatically without the ncccaaity of any bill of IlIe, ccrtiflCalc of tilIe or _ ~ of
conveyance. Lcaec ahal~ --............. deli_ any _ i-...-s.. Laaor may roqueat 10 evidence mc:h .........cr.
_ 6.02. Sewrlly lole-' To ....... tbe paymcnl or .11 of Lcaec'I obliplions under IhiI Ap-. Lcaec hcroby ..... .. Laaor . ao<uriIy intereat
COI'IItitutin& . tint lien on the Equipment and on all additiom. aa.ac:hmerua and accessions thereto. subltitutiOl1llhcref'or and proceeds Ihere&om. Lcucc apees to exacu1c such
additional documenIs. in (orm Jalwactory to Laaor. which LeIIor deeIm nccca.ary or appropriate to establish and maintain ilIlCl:Urity inIercst and the aecurity inlcrcIt of any
...;_ ofLaaor in tbe Equ;p-o.
_ 6.03.'_ Property. The Equipmenl is.... will remain perIOIlIl Jl'-'Y. The Equipmenl will not be""""" to be .II-.xcd to or. put of the ...1......
... which it may be aituatcd, nolwi1hatandinc thol tbe Equipment or any put_may be or hcraftcr bcc:omc in any IIWlIlcr phyaically affuccd or aIIachcd to _ .... ...... or
any ...ildina""""" Upon the........ ofLaaor. Lcaec wil~ aI ~ -. filmiah. waiver of any intereat io tbe Equipmenl fi'om any party having an intereat in any_
.... ...... or ...ikfinc.
ARTICLE VII
_7.01. LIcoa, T__ 0Iber eo.e.-atol <.'IIIf1ea and UIWIy Cho"... !.alee shall_ the Equipment fi'cc oralllevi...li............................
1hoae........ by IhiI ~ The putioa to IhiI ~ .............lhat the Equopmenl will be _ tor. CO.w..._4a1 or proprietary ....- of Lcaec .... thol the
Equipmenl will thaefon be........ fi'om.1I Jl'-'Y IaXCL If the .... poaaeaai... or ocquiaition of the Equipmenl is ncverthcI... determined to be aubj... .. taxation, Lcaec ahaIl
pay when due all......... ~ charpa lawfully _ or Ievicd .pinal or wilb........... the Equipmcnl. !.alee shall pay.1I utility ODd _ c:harpa incumd in the
... ODd maintenance oftbe EqWpmcnI. Lcaec shall pay auc:h..... or charpa............ may bcc:omc duo: pnnided that, wilb........... any _..... or charpa tholmay
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lawfully be paid in installments over a period of years. Lessee shall be obligated to pay only such installmenls which accrue during the Lease Term.
Section 7.02. Insu.nuace. At its own expense. I..cssee shall maintain <a> cuualty insurance insurinc the Equipment against loss or damage b)' fire and .11 other risks
c:overed by the IIIIndard extended coverage endonement then in use in the State and aftY. other risks reuonably required by Lessor in an amount at lcast cquallo the then applicable
Pun:Iwe Price of!he Equipment. (b) liability""""- that......... Lessor from liability in all._ in form and....... sotWadory to Lessor. and (c) workers' compenutian
c:cwnp u nquired by !he laws of!he State; ....vided that, with Leaor'I prior written ........ LesIee may ..If........ apinst the riIks described in cl..... (a) and (b). All
""""-..- _ caouaIty 1.....1ila1l be payable u hereinafter ....vidcd. LesIee Iilall fUmish to Lessor -'fi_ evidenc;nS such co....p throuJlhout!he Leaae Term.
All such """,,-1ilalI be with........ that an accepIable to "-or.1ila1l name Leaaee and Lessor u insureds and shall contain a provia;on to !he .lrec:t that such insurance IilalI
not be cancelled or modUaed materially without rU'll aivine wriucn notice tberofto Leaor allcasl 10 days in advance ofauch cancellation or modification. All such cuuahy
insunncle shall contain. provision making any loascs payable to Lcuec and l..eaor u their respective interelltl may appear.
Section 7.03. AlI_ In !he...... Leaaee Iilall fail to either maintain the i........ required by this Apement or keep the Equipment in Jood ropair and workinS
order. Lessor may. but IilalI be under 1IO obIipti... to. punchue !he nquired insu..... and pay the _ of!he premiums theroof and mainlain and repair the Equipment and pay
!he _ thereof: AlI_ ao advanced by Lessor Iilall constitu.. additi....1 rent for the then cumot OriJinaI Term or Renewal Term and Leaaee.........and _to pay
such _ao advanced by Lessor with _ _ _!he due _ until paid "' the .... of 18% per.....m or the maximum....... permitled by law. whichever is .....
ARTICLE VIII
Section S.OI. Damap, Deot_..... C............_ If (I) !he Equipment or any porti... _is daIroyed. in whole or in pan, or is damapd by f.. or other
caouaIty or (b) title.... or!he~... of; !he Equipment or any part _....11 be taken under the _ orthrat of the _ of......... domain by any ...~..,_lla1
body or by any _ linn or cooponIioa..... punuanlto ...R.....ntal authority. Leaaee and Lessor will ..... the Net ........... of any i.......... eIaim, condemnation awan!
or oaIo under thrat of _on to be applied to !he prompt ............... repair. .......ti.... modification or i.....v'"'''..nt of !he Equipment. ....... ....... shall ha..
.- iIa oplion to pun:haae!he Equipment punuanlto Sec:tion 10.01. Any bal..... .fthe Net ........... nmainiftJ after such work hu been completod shall be paid to LesIee.
For _ ofthia AIticIe,!he term "Net............ ....n _!he ....... nmaininS _ the BJOII procaeds of any insu..... claim, _... awan! or.... under threat of
_... after dedudinS all._ includinS attomcyI' f.... incurTed in the collection theroof.
Sec:tion 1.02.llIIUIIIdftKV .rNct Proceeds. If the Net Proceeds arc insufficient to pay in full the COI t of any replir. restoration. modiftc:l.tion or improvement
referred to in Sec:tioo 1.01. I..-lhail either (a) complete such replacement. repair. restoration. modification or improvement and pay any COlIS thcrcofin C'XCCII ofthc amount of
!he Net........... or (b) pun:hue Leaor'I iNaat in !he Equipment pu....... to Sec:tion 10.01. The amount of the Net Proceeds, if any. nmaininS after completinSsuch ropair.
.-..;on, modifICation or ~""v,ement or after punchuin8 Leaor'I in...... in the Equipment ....n be retained by LesIee. If Leaaee ....11 make any payments punuant to thia
Section. Leaee shall not be entitled to any reimbursement therefor from Lcaor nor shall Lessee be entitled to any diminution .fthe amounts payable under Article IV.
ARTICLE IX
Sec:ti... 9.01. DISCLAIMER OF WARRANTIES. LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR lMPUED. AS TO
THE VALUE, DESIGN. CONDmON. MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE OR FITNESS FOR USE OF THE EQUIPMENT. OR
WARRANTY WTI1I RESPECT THERETO AND IN NO EVENT SHALL LESSOR BE UABLE FOR ANY INCIDENT AI.. INDIRECT. SPECIAL OR
CONSEQUENTIAL DAMAGES IN CONNECTION WTI1I OR ARISING OUT OF THIS AGREEMENT OR THE EXISTENCE, FURNISHING. FUNCTIONING OR
LESSEE'S USE OF ANY ITEM. PRODUCT OR SERVICE PROVIDED FOR IN THIS AGREEMENT.
SccIion 9.02. Velldo.... W.........1a. l..eIIor hereby ilTeVOCably .ppoi.....l..euee ita aaent and aaomey.in-fact durinc the Lcue Term. 10 Jon, as LcIIce shall not be in
default hereunder. to aaert fi'om time to time whatever c:laims and ri~ (includina without limitation warranties) relalcd to the Equipmenelhal Leaor may have apinst Ihc
Vendor. Leaaee" ani. ranedy (or !he breach of such ~. ind.m,"f...tion or ............tion ....11 be apinst the Vendor of the Equipment and not apinst Lessor. Any such
........ IilalI not ha.. any elrect _ on !he riBfns and ohliptions of Lessor with ......... to this AJroement. includins the riJht to ....i.. full and timely payments
hereunder. LeIIee exprealy acknowledges that 1..cssor makes. and baa made. no repraentations or warrantia whllIoeVcr as 10 the existence or the availability of such warnntics
by the Vendor o(!he Equipmalt.
ARTICLE X
Section 10.01. ......... Opt...... LesIee....1I ha.. the option to pun:hue Leaor'I i_ in the Equipment. upon Bivins written notice to Lessor at ..... 60 days
before !he _ ofpun:haIC. at !he (oIlowinJ timca and upon !he followinS...... and upon such _ of the pun:hue option by Leaaee to all !he equipment. thia AsI=Mnl....n
..........:
(a) On !he Jut dal.":::- OriBinaI Tam or any Renewal Term then in elrect, upon payment in full of!he Rental Payments then due hereunder plus the then applicabl.
Pun:Iwe Price plus SI.OO to . or .
(b) In!he...... of............1 damap to or deolNction or c:ondaMation ofiubotantially all of the Equipment. on the day....... specif... u the pun:hue _ in
......... notice to Lessor ofill_ of the pun:hue opti.... upon payment in full of!he R....I Paymen1a then due.......nder plus the then applicabl. Pun:Iwe Price to Lessor.
ARTICLE XI
Sec:tion 11.01. AuI_t .., Laaor. Leaor'I riJhl. tide and _ in. to and under thia ApoemenI and !he Equi_ may be aaaisned and raaisned in whol. or
in part to ... ........ __ or......._ by Lessor and. to the ...... ofhis ......... by any ReoioIerod Owner, without the _ity of obtainins !he __ of Leaaee;
...,..uted that (a) any _...-. other than an ..i_ to or by a ReoioIerod Owner. ....11 not be elrecti.. until LesIee hu received written notice. sisned by the uaipor. of
!he....... _ and... idontiflCation lllIlllber of!he ..i..... and (b) any uaipmenlto or by a ReoioIerod Owner....1I not be elrecti.. until it i. reJistered on !he ~
boob kept by !he Apnt..... lOr........ ...........11 _in all such notices u a ~ of an uai_ (other than R.......... Ownen) and "II make all payments to the
_.,.. or uai_ doaipatad in such ~ or. in the cue ofRqistered Ownen, to the ApnL Leaae Panicipation Ccrtif...... may be.- and deli...... by !he Apnt to
Rqist<nd Ownen, if any. I.-....... to execute all _ includins notices of ..i_ and chattel rnonpps or fmancins -. that may be ........tJIy
~ by Lessor or '!"f __to ........ iIa ___ in the Equ~ and in thia AJroement. Leaaee &hall not ha.. the riJht to and ....11 not ...... against any uaipee or
RqisIered Owner any claim, .............. or other riJl1l Leaaee may ha.. apinst Lessor.
Sec:tion 11.02. Aula-t ..... Su-S by LouH. N.... of ......... riJht, tide and _ in. to and under this ApoemenI and in the Equipment may be
-sned or _ by ....... lOr any __ except that ....... may subleue all or part of the Equ~ ifLeslee obcains the prior written __ of Lessor and an opinion
of nationally __ -..I in the _ of... exempllllllllicipal obIiptions sotWadory to Laaor that such subleuins will not adveraely alrect !he udusion of the .......
_........,.. of!he Rental Paymen1a _ V- income lOr fcderaI income ... _ Any such subIceae of all or part of!he Equipment ....11 be subject to thia AsI=Mnl and
!he riJhll of!he Lessor in. to and under thia ^-- and !he Equipment.
ARTICLE XII
Sec:tion 12.01. Eo"" o( o....u" DeIIn.... Subject to !he provisions ofSection 3.03. any of the followinS ...... &hall constitu.. an .Event of DefauU. under thia
ApoemenI:
(a> Failure by Leaee 10 pay any Rental Payment or other payment required to be paid hereunder at the time specified ~in;
(b) Failure by Leaee to observe and perform any COvenant, condition or agreement on il5 part to be observed or performed. other than II referred lo in subparagraph
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(a)~abovc. for a period of30 days after ~ritten notice specifying such failure and requesting that it ~ remedied is given to I...cssee by Lcuor, unless 1..asor shaUagrce in writing to
an extension of suc:h time prior to its eJqtiration: provided that, if the failure stated in the notice cannot be correeted within the applicable period, Lessor will not unreasonably
withhold its consent to an extension of such time if corrective action is instituted by Lessee within the applicable period and diligently pursued until the defauk is correded;
(e) Ally stalement. representation or warranty made by Lessee in or pursuant to this Agreement or its execution. delivery or perfonnance shall prove to have been false,
~ __g..._ in any matcrial_ on the date when made;
(d) Lcaee oltaIl (i) apply C...... __ to the appoin1mcnt of a m:civcr. ......... eustodian ...Iiquidalor ofLeaee. or or all... a IUboIantial part of!he ..... ofLeaee.
(ii) be unable. fail ... admit in writing ita inability pnenlly to pay ita dcbIs u thcy beoome due. (iii) malee a pnenl usi.,- for the benefit of credi..... (iv) have an onler f...
relief entered apinIt it under applicable bankruptcy law. or (v) file a voluntary petition in bankruptcy or a petition or an answer seeking reorganization or an arrangement with
c:reditan or takinS advantqe of any inaolvenc:y law or any answer admittins the material allegatiorw of. petition filed apinsl Lcsscc in any bankrupeey. reorpnization or
insolvenc:y ..-edinB; ...
(e) An order.judgment or decree shall be entered by any court of competent jurisdiction. approving a petition or appointing a receiver, trustee, euslodian or liquidator
ofLcuee of all or.1UIMIIrdiaI part of the assets ofLesscc, in each ease withoul its application, approval or consent, and such order, judgment or decree ahall continue unsaayed
.... in efrect f... any period of30 COIIIOCUlive days.
Section 12.02. _lea 011 Default. Whenever any Event or o.rauh exists. Lesaor shall have the right. at ita IOle option without any fUrlha- demand ... noli... to
lake Cll1O... any combination of the following mnedial slepo:
(a) By _ noli.. to Leaaee, Leaor may declare all R....I PaymenU and other amounts payable by Lcaee herounder to the end orthe then <UlTOlll Original Tam
ar Renewal T<<m to be due;
(b) With... without terminating Ihis Agreement. Leaor may enler lIle ......... where the Equipment is loc:aled and retake -"'" of the Equipment or .....ire
Lcaee at Lcaee'a _ to JII'Ol1lPIIy.....m any... all of the Equipment to the ~on ofLeaor at audl p.... within Ihe UniIed S..... u Leaor oltaIl specity. and sell orluae
the Equipment or. for the account of Leuee. sublease the ~lpmcnt, continuing to hold Leuce liable for the difference between (i) the Rental Paymenll and other amounts
payable by Lcaee henunder to the end of!he then culTenl Original Term ... Renewal Term. and (ii) the net orooeeds or any IUch sale, ....ing orlUbleuing (after deducting all
expenses ofLeaor in exercising ill remedies under this Agreement, including without limitation all expenses ottakinl possession, lIorine, rcc:onditionine and sellina: or leasia, the
Equipment and all brokerqe. auc:tioneers' and 1IIomeyS' fees)~ and (e) Lessor may take whatc=ver action at law or in equity may appear necessary or desirable to cnfon:c its nJhts
u the owner of the Equipment.
Section 12.03. No _y Exduslv.. No mnedy herein c:onf...... upon or reserved to Leaor is intended to b< e""lusive and every aud1 mnedy shall be cumulative
and shall be in addition to every oIhcr nmedy given under this Agreement now or hereafter existing at law or in cquily. No delay or omission to exercise any richl or power
accnoing upon any def'auk oltaIl impair any audl rigllt... power or shall be c:onslrUed to be a waiver \hereof. but any aud1 rigllt or """.... may be exen:iaed fiom time to time and u
often as may be deemed expedieN.. In order to entitle 1..euor to exercise any remedy reserved to it in this Article it shall not be necessary to give any notice other than such notice
IS may be requited in this Article.
ARTICLE Xlll
Section 13.01. Notices. All notiea, c;:crtificates or other communications hereunder shall be suffICiently given and shall be deemed given when delivered or mailed by
rqioleRd mai~ poIlllge prepaid, to the par1ies......o at the addreaes on the front oflllis ........" (... at aud1 other addras sa eilba- party ....... shall desjJPlale in writing to !he
other far noticeIto such party). to any uaipee at its acIdraI.. it appears on the registration books maintained by LeIIee or the Apnt.
Section 13.02. ReIeue .....lodemnllkallon. To the e...... permitted by law. Lessee shall indenWfY. _ hold hannl.... save and keep Iwmleu Leaor fiom and
apinst any and all liability. obIiplioa.loa, claim. ... and damage~. repnll... of...... \hereof. and all __ in _on therewilh (inoludina wilhoutlinUlation
......... feea and __ and any foderal income lax and inIerat and _ki.. c:onneded lherewilh inlpoIed on interest m:cived) ariaing out of... u the _Ii of (a) the entering
into oflhia ~ (b) the ownenhip of any iIem of the Equipment. (c) the ordering. acquisition. use. operalion. c:ondilion. putdlaM, delivery. rejec:tion. -'10'" reIUllI of
any iIem oflhe Equipment. (d) any accident in _ion wilh the operation. use. condilion. ........... -'10 ... reIUllI of any iIem of the Equipment_hing in damap to
pn>perty... injwy to... death to any penon. andI... (e) the breach of any covenant herein ... any material ~ c:ontained herein. The indemnification nng under
Ihia....... &hall continue in &11 f_ and eIfec:t notwi_ndins the &11 payment of all obligations under Ihia Apemenlor the lerminalion of the Leue Tam for any........
Section 13.03. Eat1re A.. ___~L This Ajp=nenl_ the entire a........ between Leaor and Lessee.
Section 13.04. BInding Ell"_ This Apemenl shall inute to the benefi' of and shallb< binding upon Leaor and Lessee and their _ive sua:esson and usip
Section 13.05. 5n'enltlUty. In the event any provision of this Ap'eemenl shall be held inVIIlid or unenforceable by any court of competent jurisdic:tion, JUCh boldine
shall lICIt invalidate or render unenforceable 11II)' 0Iher provision hereof.
Section 13.06. Amend_ CIuuopa ..... Modllkat_ This Apemenl may be amended by Leaor and Lessee; provided Ihat no .....- Ihat a1f.... the
rigllls of the Registered Ownen shall be efrec:tive unl... ~ shall have been _ 10 by the Regis1ered Ownen ofa majority. in principal amounl, of the Lease Participation
Certif_ if any. then oulIIaIIding.
Section 13.07. Ex_In C_erpa.... This Apemenl may be simultaneously ......ted in aeveral oounterpo.... ead> of whic:b shall be an original and all of
whic:b oltaIl_ but Cll10 and the...... insIturMK.
Section 13.08. Applleoble Law. This Ap'eemenl shall be sovemed by and c:onslrUed in aoeordanc:e willl the laws orthe S.....
Sedion 13.09. C.ptIonL 1be captions or headings in this Ap'eemenl are for convenience only and in no way define, lintil or describe the scope or intent of any
provisions... _ oflhia AgrccmenI.
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E.XIIIBIT A TO EQUIPMENT LEASElPURCIIASE AGREEMENT
SCIlEDULE OF RENTAL PA YMENTS
Reallll Paymeal
~
RenllllP_I
Amounl
laterat
l!I!!!m
PriIodpol
!!!!:!!m!
Pun:_
PrI<.
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EXJlJBIT A TO EQUIPMENT LEASElPURCIIASE AGREEMENT
(CONTINUED)
SCIIEDULE OF RENTAL PA YMENTS
_P_t
l!!m!!!a
a..taI Payment
6m!!!m!
Internt
Portion
PriDdpal
l!J:!!!m
-
Plio_
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ACCEPTANCE CERTIFICATE
Koch Fmancial CorponliOll
4111 Eut 37th Stnet North
WidUta. Kanou 67226
R.:Equipment LeueIPun:hue Acnem<m. daIed u of
and "(Leuee")
. 19 _ (th. ""-"'")' between Koch Financi.1 CorporaliOll ("Leuor")
Ladies and Gentlemen:
III _ with the Acnem<m.the .......i..... Leuee henby _ifi.. and.......... to, and...... with, Leaot u ronowe:
(1) All of the Equipment(u defined in the A8Jeemenl) baa been deli....... _lied and a<<epIed 011 the _ hereol
(2) Leuee baa _ ow:h inopcctiOll and/or ....ing of the Equipment u i. deems neceaary and appropriaIe and henby odcnowIedges IhaI ~ ....... the
Equipmentforall_
(3) Leuee ia....-Jy nlIintainingthe inaurance 00_ "'I"iRd by Scdi0ll7.02 of the Acnem<m.
(4) No.....<< c:andition IhaI c:onsU1uleo. or with noIi<:e <<iapoe ofti.... orbolh, would constitute. an E_ ofomult (u defmed in the Apoemenl) exiala..the_
hereol
Daled:
LESSEE
(SEAL]
By
Title:
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(CROSS our ANY INAPPUCABLE PARAGRAPHS. INCLUDE PARAGRAPHS 1.2 AND 3 TO DESIGNATE THE AGREEMENT AS A "QUAUFlED TAX-E."\:EMPT
OBUGATlON", INCLUDE PARAGRAPHS 1.4 AND' TO QUALIFY fOR ARBITRAGE REBATE E.,CEPTlON fOR SMALL GOVERNMENTAL UNITS]
TAX DESIGNATIONS AND COVENANTS
I. The.......... ond desipalions _ ... forth are inleoded to be. ond hereby are, inc:arponlcd into the Equipment LeueIPun:huc: ~ dIIed
19 (the "ApocmcnI"), _ ("~) ond
- ("Leaee"), ond cxccpl u oIhcrwiJc defined herein, all ...... def..... on .... ApocmcnI dIaIl
have the I&IDC meamng herein U In the ~ The Commax:cmcnt Dale of1hc ApocmcnI is or will be in the calendar year 19_ (the "lauanc:e Y car").
2. Leaee hereby _paleo.... ~ u a "qualified tax_ obligation" u clef..... in Section 26'(b)(3)(B) of.... Code. The aar<P.'" ra.. _ ofall
tax_ obligations (excIudinc pri.... ....vity bonds o4her _ qualified '01(.X3) bonds) iaucd.. to be iaucd by Leaee ond all aubordinaIo....... lhenoofdurina....
......... You ia nolnaaonahly ellpllCI<d to m:eed SI0.ooo.ooo.
3. LoDee henbf............... Leaee ond all aubordinaIo ontiti.. .......fwill noI ..... in..... ofSIO,ooo.ooo of qualilied tax_ obtigation& (including the
Agreomenl but exdudinc....... acoi~ bonds o4her _ qualilied ~ 1(.X3) bonds) during the .......... Y.... wi...... firat _gan opinion of nationally nc:clIftizecI........
in........ of tax...... nmicipaI obhpti_ accepIable to ~..... the designation of.... A&r<a-U u a "quaIilied tax......... obliption" will noI be adwneJy alI'_
4. LoDee ...._* ond.............. it ia a CO_I unit under the laws of the S.... with genenJ taxing powers; the Agreomenl is noIa pri.... acoivity bond u
ddinod in Seclion 141 of the Code; 95"'...... of the net ..- of.... ~ will be uaed f..locaI .....w..._1IaI acoiviti.. of I.-; and the __ ra.. _ of
all tax...... obIipti_ (__ pri.... acoivity bonds) iaouecI..to be iaouecI by the Leaee ond all aubordinale ontiti.. thereofduring.... ..........Y.... ia not_y
expeoIecI to _ $5.000.000.
5. LoDee hereby............... Leaee ond all aubordina.. entiti.. .......fwill not..... in..... of $5,000.000 of tax ........ bonds (including the Agreomenl but
excluding private ac:Iivity bonds) during the lauance Year without first obtaining an opinion or nationally reeopizcd counsel in the ana oflaX-exanpt municipal obtiptions
accepIable to ~.....the excludability oflhe in...... on.... ApocmcnI from..... i...... for feclcTaI tax purposes will not be ad.....ly aff_
DalecI:
(SEAL]
LESSEE
ATTEST:
By.
Title:
CERTIFICATE OF CLERK OR SECRETARY OF LESSEE
~ the ull_oiped, do hereby certilY..... (i) the foregoing Tax Deoi~i_ and CoYenanla __ adopIecI and approved by action of the .......g body ofLeaee ala
meelin& duly called, .....Iarly __ ond .......... -..- by Ihe nqu..... majocity of.... memben thereof; (ii) .... oft"_ of Leaee wIlo _ the r-..mg Tax
Deoignation and CoYenanla on behalf of Leaee ond _ genuine oiJPlalUl< appeua _ ia Ihe duly qualiliecI ond acoing oft"_ of Leaee u Ila1ecI benea1h his .. her
oi......... and (io) said off_ hu been auIhorizecI to __.... fongoing Tax Deoignaliano ond eo........ on behalf ofLeoaee.
DalecI:
Titl.:
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ESSENTIAL USFJSOURCE OF FUNDS LETTER
Koch Financial Corponlion
4111 Eul371h SL North
Wichi1a, KS 67220
Re: Equipmcol Lcuc Apccmcn1 No.
GcntIemen:
TbiI confil1lll UIlI alfll1lll1hll the Equipmcol dcocribccl in the Equipment Lcuc Apccmcn1..rcmd 10...... (the . Apccmcn1") is _110 the l\mc:lion of the
undcnigned or to the IeI'Yice we provide to our citizens.
Further, we have an _ale need for, UIlI expccIlo make il11ll' '.'... UIC of, IUbotantially aJllUdl Equipment, which need is ...tomponry or cxpccIed 10 diminiIh
in the foraccahle fiItwo. Such Equipmcol will be used by us only for the purporc of performing one or..... of our govcmmcnIal or propriewy liln<liOlll_ wilh the
permissible _ of our au1hority. SpccU"",lIy,lUcIt Equipment wu ocIcc:tcd by us 10 be used IS follows:
Tbc IIIimaIcd uacIilllifc ofsuclt Equipment based upon manuf.......... rcpnscnIaIiOlll UIlI our projcc:tcd nccdo is
Our....... of_ for pa_ of the rent due under the Agrocmcnl for the oumnt fISCal yeor is
vcan.
We expec;:t and anticipate adequate funds to be .vailable for.1I future,.ymenls ofmrt due after the current fiscal yar for the following raaons:
Very truly youn.
Lcacc
By:
(SignalU" UIlI TnIc)
Dale: