HomeMy WebLinkAbout2010-090
(NOTE: COMPANION RESOLUTION 2010-91)
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RESOLUTION NO. 2010-90
RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY
OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT
AND ISSUANCE OF A PURCHASE ORDER TO FAlRVIEW FORD OF SAN
BERNARDINO FOR THE PURCHASE OF FOUR (4) 2010 FORD CROWN VICTORIA
POLICE INTERCEPTORS AND AWARD A LEASE-PURCHASE AGREEMENT TO
BANK OF AMERICA.
BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE
CITY OF SAN BERNARDINO AS FOLLOWS:
SECTION 1. The City Manager of the City of San Bernardino is hereby authorized tQ
execute on behalf of said City an Agreement between the City of San Bernardino and Fairview
Ford, a copy of which is attached hereto, marked Exhibit "A" and incorporated herein by
reference as fully as though set forth at length.
SECTION 2. This purchase is exempt from the formal contract procedures of Section
3.04.010 of the Municipal Code, pursuant to Section 3.04.010. B.3 of said Code "Purchases
approved by the Mayor and Common Council".
SECTION 3. That Fairview Ford has offered a purchase price of $26,924.12 per 2010
Ford Crown Victoria vehicle, which includes tax for a total not to exceed $107,696.48 pursuant
to Section 3.04.010 B-3 of the Municipal Code.
SECTION 4. The Purchase Order shall reference this Resolution Number and shall
read, "for the purchase of four (4) 2010 Ford Crown Victoria Police Interceptors" and shall
incorporate the terms and conditions of the Agreement.
SECTION S. That Bank of America provided the lowest rate quote for the lease-
purchase of a four (4) Ford Crown Victorias, marked Exhibit "C". Pursuant to this
determination the Director of Finance is hereby authorized to execute lease-purchase
documents with Bank of America.
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2010-90
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RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY
OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT
AND ISSUANCE OF A PURCHASE ORDER TO FAIRVIEW FORD OF SAN
BERNARDINO FOR THE PURCHASE OF FOUR (4) 2010 FORD CROWN VICTORIA
POLICE INTERCEPTORS AND AWARD A LEASE-PURCHASE AGREEMENT TO
BANK OF AMERICA.
SECTION 6. The authorization to execute the above referenced Purchase Order and
Agreement is rescinded if not issued within sixty (60) days of the passage ofthis Resolution.
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2010-90
RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY
OF SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT
AND ISSUANCE OF A PURCHASE ORDER TO FAlRVIEW FORD OF SAN
BERNARDINO FOR THE PURCHASE OF FOUR (4) 2010 FORD CROWN VICTORIA
POLICE INTERCEPTORS AND AWARD A BID FOR LEASE PURCHASE
FINANCING TO BANK OF AMERICA.
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I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor
joint
and Common Council of the City of San Bernardino at a regular meeting thereof, held
on the 3rd day of May
Council Members: AYES
MARQUEZ X
DESJARDINS X
BRINKER X
-
SHORETT X
KELLEY X
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JOHNSON X
X
MCCAMMACK
,2010, by the following vote, to wit:
NAYS
ABSTAIN ABSENT
~~h.~
Rachel G. Clark, City Clerk
The foregoing resolution is hereby approved this b'TH day of _~
2010.
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es F. Penman, City Attorney
2010-90
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VENDOR SERVICE AGREEMENT
This Vendor Service Agreement is entered into this 3rd day of May 2010, by and
between Fairview Ford ("VENDOR") and the City of San Bernardino ("CITY" or "San
Bernardino").
WITNESSETH:
WHEREAS, the Mayor and Common Council have determined that it is in the best
interest of the CITY to contract for the purchase of four (4) 2010 Ford Crown Victoria Police
Interceptors; and
WHEREAS, the City of San Bernardino has determined that vendor possesses the
professional skills and ability to provide said services for the City;
NOW, THEREFORE, the parties hereto agree as follows:
1. SCOPE OF SERVICES.
For the remuneration stipulated in paragraph 2, San Bernardino hereby engages the
services of VENDOR to provide those products and services as set forth in its proposal dated
November 4, 2009, attached hereto, marked Attachment "1" and incorporated herein by this
reference as fully as though set forth at length.
2. COMPENSATION AND EXPENSES.
a. For the services delineated above, the CITY, upon presentation of an invoice, shall
pay the VENDOR up to the amount of $26,924.12 for each 2010 Ford Crown
Victoria Police Interceptor and to provide and perform those products and services
described in Section I above. Total amount not-to-exceed $107,696.48 for all four
(4) 2010 Ford Crown Victoria Police Interceptors.
b. No other expenditures made by VENDOR shall be reimbursed by CITY.
Exhibit "A"
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2010-90
3. TERM.
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The term ofthis agreement shall be for a period of one (1) year.
This Agreement may be terminated at any time by thirty (30) days prior written notice
by either party. The terms of this Agreement shall remain in force unless amended by written
agreement of the parties executed on or before date of expiration of current term of the
agreement.
4. INDEMNITY.
Vendor agrees to and shall indemnify and hold the City, its elected officials, employees,
agents or representatives, free and harmless from all claims, actions, damages and liabilities of
any kind and nature arising from bodily injury, including death, or property damage, based or
asserted upon any or alleged act or omission of Vendor, its employees, agents, or
subcontractors, relating to or in any way connected with the accomplishment of the work or
performance of service under this Agreement, unless the bodily injury or property damage was
actually caused by the sole negligence of the City, its elected officials, employees, agents or
representatives. As part of the foregoing indemnity, Vendor agrees to protect and defend at its
own expense, including attorney's fees the City, its elected officials, employees, agents or
representatives from any and all legal actions based upon such actual or alleged acts or
omissions. Vendor hereby waives any and all rights to any types of express or implied
indemnity against the City, its elected officials, employees, agents or representatives, with
respect to third party claims against the Vendor relating to or in any way connected with the
accomplishment of the work or performance of services under this Agreement.
S. INSURANCE.
While not restricting or limiting the foregoing, during the term of this Agreement,
VENDOR shall maintain in effect policies of comprehensive public, general and automobile
Exhibit "A"
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liability insurance, in the amount of $1,000,000.00 combined single limit, and statutory
worker's compensation coverage, and shall file copies of said policies with the CITY's Risk
Manager prior to undertaking any work under this Agreement. CITY shall be set forth as an
additional named insured in each policy of insurance provided hereunder. The Certificate of
Insurance furnished to the CITY shall require the insurer to notify CITY of any change or
termination in the policy. Insurer shall give CITY 30 days notice prior to enactment and any
change or termination of policy.
6. NON-DISCRIMINATION.
In the performance of this Agreement and in the hiring and recruitment of employees,
VENDOR shall not engage in, nor permit its officers, employees or agents to engage in,
discrimination in employment of persons because of their race, religion, color, national origin,
ancestry, age, mental or physical disability, medical conditions, marital status, sexual gender or
sexual orientation, or any other status protected by law, except as permitted pursuant to Section
12940 of the California Government Code.
7. INDEPENDENT CONTRACTOR.
VENDOR shall perform work tasks provided by this Agreement, but for all intents and
purposes VENDOR shall be an independent contractor and not an agent or employee of the
CITY. VENDOR shall secure, at its expense, and be responsible for any and all payment of
Income Tax, Social Security, State Disability Insurance Compensation, Unemployment
Compensation, and other payroll deductions for VENDOR and its officers, agents, and
employees, and all business licenses, if any are required, in connection with the services to be
performed hereunder.
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Exhibit "A"
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2010-90
8. BUSINESS REGISTRATION CERTIFICATE AND OTHER REQUIREMENTS.
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VENDOR warrants that it possesses or shall obtain, and maintain a business registration
certificate pursuant to Chapter 5 of the Municipal Code, and any other license, permits,
qualifications, insurance and approval of whatever nature that are legally required of VENDOR
to practice its business or profession.
9. NOTICES.
Any notices to be given pursuant to this Agreement shall be deposited with the United
States Postal Service, postage prepaid and addressed as follows:
TO THE CITY:
Public Services Director
300 North "D" Street
San Bernardino, CA 92418
Telephone: (909) 384-5140
TO THE VENDOR:
Fairview Ford Sales Inc.
808 West 2nd Street
San Bernardino, CA 92412-5516
Telephone: (909) 386-0281
Attn: Todd Eff
10. ATTORNEYS' FEES
In the event that litigation is brought by any party in connection with this Agreement,
18 the prevailing party shall be entitled to recover from the opposing party all costs and expenses,
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including reasonable attorneys' fees, incurred by the prevailing party in the exercise of any of
its rights or remedies hereunder or the enforcement of any of the terms, conditions or
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provisions hereof. The costs, salary and expenses of the City Attorney and members of his
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office in enforcing this Agreement on behalf of the CITY shall be considered as "attorneys'
fees" for the purposes of this paragraph.
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Exhibit "A"
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2010-90
11. ASSIGNMENT.
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VENDOR shall not voluntarily or by operation of law assign, transfer, sublet or
encumber all or any part of the VENDOR's interest in this Agreement without CITY's prior
written consent. Any attempted assignment, transfer, subletting or encumbrance shall be void
and shall constitute a breach of this Agreement and cause for the termination of this
Agreement. Regardless of CITY's consent, no subletting or assignment shall release VENDOR
of VENDOR's obligation to perform all other obligations to be performed by VENDOR
hereunder for the term of this Agreement.
12. VENUE.
The parties hereto agree that all actions or proceedings arising in connection with this
Agreement shall be tried and litigated either in the State courts located in the County of San
Bernardino, State of California or the U.S. District Court for the Central District of California,
Riverside Division. The aforementioned choice of venue is intended by the parties to be the
mandatory and not permissive in nature.
13. GOVERNING LAW.
This Agreement shall be governed by the laws of the State of California.
14. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding on and inure to the benefit of the parties to this
Agreement and their respective heirs, representatives, successors, and assigns.
15. HEADINGS.
The subject headings of the sections of this Agreement are included for the purposes of
convenience only and shall not affect the construction or the interpretation of any of its
proVISIOns.
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Exhibit "A"
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2010-90
16. ENTIRE AGREEMENT; MODIFICATION.
This Agreement constitutes the entire agreement and the understanding between the
parties, and supercedes any prior agreements and understandings relating to the subject manner
of this Agreement. This Agreement may be modified or amended only by a written instrument
executed by all parties to this Agreement.
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Exhibit "A"
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2010-90
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VENDOR SERVICE AGREEMENT
FAIRVIEW FORD SALES INC.
IN WITNESS THEREOF, the parties hereto have executed this Agreement on the day
and date set forth below.
Dated: 05/ R ,2010
:~;4~
Dated ~ ~ ,2010
B:
Charles E. McNe
lty Manager
Approved as to Form:
EXHIBIT "A"
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2010-90
Attachment 11111
..
@
F~VIEWFORD
FLEET & TRUCK CENTER
808 w. 2ad STREET'
P.O. Box 5516
SAN BERNARDINO, CA. 9241% ,
(909) 386-0281 or Fu: (909) 386-0292
11/04/09 20:31:34
Dealer: !'71156
Page: 1 of 2
Order Type: 58 Price Level: 015
PO Number:
VEHICLE ORDER CONFIRMATION
->
order No: 0000 priority:
Ord Code: 730A Cust/Flt Name:
RETAIL
P7B POLICE INTERCEP $27415
A: M6640A B: M6373L C:
H CLTH BUCKETS/llR
N CHlIRCOlIL BLACK
7301'. ORDER CODE
'. DUAL EXHAUST
.17" STEEL SPARE
.Ml\NUl\L AIR COND
. ENG IDLE METER
99V . 4 . 6L OKC E'F'l va
44Q .ELEC ADD TRANS
TCl .P235/55R17 BSW
CAt. BOARD FEES
14T TRUNK PACK
FRT LICENSE BKT
(65)
NC
NC
NC
NC
190
NC
2010 CROWN VICTORIA
Ord FIN: QC414
CITY OF SB
175
177
2lA
423
435
'RETAIL
HORN/SIREN PREP $40
SILICONE HOSES ' 320
PWR DRIVER SEAT 380
,CAt EM NOT REQD
KEY CODE 1294X
TOTAL BASE AND opTIONS
TOTALDSO/SPO OPTIONS
TOTAL
50
32295
935
33230
11/04/09.20:31:42
Dealer: F71156
Pagel 2 of 2
Order Type: 5B Price Level: 015
PO Number:
==>
VEHICLE ORDER CONFI~TION
order No:
Ord COde:
0000 Priority:
730A cust/F1t Name:
RETAIL
478 c/LAMPS DISABLE
SlY DUAL SPOT LAMPS
53M NOISE SUPPRESS
61H nECKLD REL IP/n
63B SMOKERS PACKAGE
67R llR DR HND mop
76A BLACK BUMPERS
794 PRICE CONCESSN
90B LHlRH PANELS
936 CAt SER VEH EXP
948 RR WINDOW DEL
96B FR'l' MLDG WINST
DSO/SPO OPTIONS
SP213 PAINT CIll\RGE
SP DLR ACCT ADJ
$20
340
95
60
10
25
NC
2485
NC
25
30
2010 CROWN vICTORIA
ord FIN: QC414
CI'I'Y OF SB
SP FLT ACCT CR
FUEL CHARGE
B4A NET INV FLT OPT
PRICED DORA
DEST AND DELIV
TOTAL BASE AND OPTIONS
TOTAL DSO/SPO OPTIONS
TOTAL
935
RETAIL
NC
NC
875
32295
935
33230
2010-90
FAIRVIEW FORD - RETAIL - Work Bneet
K=========m============~.=====.===================~=======================~=======n=
~j) 3-13-09
Customer:
Horne Ph#:
work Fn#:
Salespsn:
=========5=======-=======================================.=====_=====~=====E========
Stock #: <NEW>
Purchase:
Trade-In: N/A
Bank
Price 24,693.00
Accessories .00
9% Sales Tax 2,222.37
Service Agreement .00
Cash Price 26,915.37
DMV .00
Tire Fee 8.75
Insurance Premiums .00
Total Purchase 26,924.12
Trade-In .00
Less pay-Off .00
Net Trade-In .00
~eferred Down .00
Amount Paid Now .00
Total Downpayment .00
Amount Financed 26,924.12 &::'H.
CUSTOMER'S ACCEPTANCE
2010-90
MASTER EQUIPMENT LEASE/PURCHASE AGREE~IENT
This Master Equipment Lease/Purchasc Agrcement No, 2114500-06000 (the
"Agreement") dated as of May 10,2010, and entered into between Bank of America, National
Association, a national banking association ("Lessor "), and City of San Bernardino, a body
corporate and politic existing under the laws of the Statc of California ("Lessee "),
WITNESSETH:
WHEREAS, Lessee desires to lease and acquire from Lessor certain Equipment described
in each Schedule (as each such term is defined herein), subject to the ternlS and conditions of and
for the purposes set forth in each Lease; and in the event of a conflict the tenns of a Schedule
prevail; and
WHEREAS, the relationship between the parties shall be a continuing one and items of
equipment may be added to the Equipment from time to time by execution of additional
Schedules by the parties hereto and as otherwise provided herein; and
WHEREAS, Lessee is authorized under the constitution and laws ofthe State to enter into
this Agreement and the Schedules hereto for the purposes set forth herein;
NOW, THEREFORE, for good and valuable consideration, receipt of which is hereby
acknowledged, and in consideration of the premises hereinafter contained, the parties hereby
agree as follows:
ARTICLE I
Seetion 1.01. Definitions. The following terms will have the meanings indicated below
unless the context clearly requires otherwise:
"Acquisition Amount" means the amount specified in each Lease and represented by
Lessee to be sufficient to acquire the Equipment listed in such Lease,
"Acquisition Fund" means, with respect to any Lease, the fund cstablishcd and held by
the Acquisition Fund Custodian pursuant to the related Acquisition Fund Agreemcnt, if any,
"Acquisition Fund Agreement" means, with respect to any Lease, an Acquisition Fund
and Account Control Agreement, substantially in the form of Exhibit A attached hereto, in form
and substance acceptable to and executed by Lessee, Lessor and the Acquisition Fund Custodian,
pursuant to which an Acquisition Fund is established and administcred.
"Acquisition Fund Custodian" means the Acquisition Fund Custodian identified in any
Acquisition Fund Agreement, and its successors and assigns,
#765674vl (BAPCCICA Abatement Lease Temptate)
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"Acquisition Period" means, with respcct to each Lease, that period statcd in the
Schedule to such Lease during which the Lease Proceeds attributable to such Lease may be
expended on Equipment Costs,
"Agreement" means this Master Equipment LeaseIPurchase Agrcement, including the
exhibits hereto, together with any amendments and modifications to the Agreement pursuant to
Section 13,05.
"Code" means the Internal Revenue Code of 1986, as amended, Each reference to a
Section of the Code herein shaH be deemed to include the Uniled States Treasury Regulations
proposed or in effect thereunder. >
"Commencement Date" means, for each Lease, the date when Lessee's obligation to pay
rent commences under such Lease, which date shall be the earlier of (i) the date on which the
Equipment listed in such Lease is accepted by Lessee in the manner described in Section 5.01,
and (ii) the date on which sufficient moneys to purchase the Equipment listed in such Lease are
deposited for that purpose with an Acquisition Fund Custodian.
"Contract Rate" means the rate identified as such in the applicable Schedule,
"Equipment" means the property listed in each of the Leases and all replacements,
repairs, restorations, modifications and improvements thereof or thereto made pursuant to
Section 8,01 or Article V. Whenever reference is made in this Agreement to Equipment listed in
a Lease, such reference shall be deemed to include all such replacements, repairs, restorations,
moditlcations and improvements of or to such Equipment.
"Equipment Costs" means the total cost of the Equipment listed in each Lease, including
soft costs such as freight, installation and taxes paid up front by Lessor and all capitalizable
consulting and training fees approved by Lessor, legal fees, financing costs, and other costs
necessary to vest full, clear legal title to the Equipment in Lessee, subject to the security interest
granted to and retained by Lessor as set froth in each Lease, and otherwise incurred in connection
with the financing provided by the lease-purchase of the Equipment as provided in each Lease;
provided that (i) any such soft costs on a cumulative basis shall not exceed a percentage of the
Maximum Equipment Cost approved by Lessor and (ii) in no event shall capitalizable delivery
charges, installation chargcs, taxes and similar capitalizable soft costs relating to such Equipment
be included without Lessor's prior consent
"Event o/Delimlt" means an Event of Det:1ult described in Section 12.0 I.
"l.ease" means a Schedule and the terms of this Agreement which are incorporated by
reference into such Schedule, Each Schedl!le shall constitute a separatc and independent Lea,se.
,
"Lease Proceeds" means, with respect to each Lease, thc total amount of money to be
paid by Lessor to VendoL
"Lease Term" for each Lease means the Original Term and all Renewal Tenns therein
provided and for this Agreemcnt means the period from the date hereof until this Agreement is
tenninated..
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2010-90
"Lessee" means the entity referred to as I,essee in the first parah'Taph of this Agreement.
"Lessor" means (a) the entity rcferred to as Lessor in the lirst paragraph of this Ah'Tec-
ment or (b) any assignee or transferee of any right, title or interest of Lessor in and to the
Equipment under a Lease or any Lease (including Rental Payments thereunder) pursuant to
Section 11.01, but does not include any cntity solely by reason of that entity retaining or
assuming any obligation of Lessor to perfom] undcr a Lease.
"Material Adverse Change" means (prior to the Utilization Period Expiration, a
do\vnblade in Lessee's extef11a] debt rating of hvo or more subgrades by ciiher Ivloody's
Investors Service, Inc" or Standard & Poor's Ratings Group or any equivalent successor.credit
rating agency, or any downgrade by either sueh agency that would cause Lessee's credit rating to
be below investment grade, and (be) thereafter, any change in Lessee's creditworthiness that
could have a material adverse effect on (i) the financial condition or operation of Lessee [and its
subsidiaries taken as a whole], or (ii) Lessee's ability to perform its obligations under this
Agreement or any Lease,
"Maximum Equipment Cost" means the cumulative amount specified in the latest
Schedule executed under this Agreement.
"Original Term" means the period from the Commencement Date for each Lease until
the end of the fiscal year of Lessee in effect at such Commencement Date.
"Purchase Price" means, with respect to the Equipment listed on a Lease, the amount
that Lessee may pay to Lessor to purchase such Equipment as provided in such Lease,
"Renewal Terms" means the renewal terms of each Lease, each having a duration of one
year and a term coextensive with Lessee's fiscal year, "s specified in the Schedule applicable
thereto.
"Rental Payments" means the basic rental payments payable by Lessee under each Lease
pursuant to Section 4,01, in each case consisting of a principal component and an interest
component.
"Schedule" means each separately numbered Schedule of Property substantially in the
form of Schedule of Property No. 3 hereto together with a Rental Payment Schedule attached
thereto substantially in the form of Exhibit A-I hereto,
"State" means the State of California,
"Utilizatiun Period" means the date, with respect to each Lease not funded under an
Acquisition Fund Agreement, by which Lessee must deliver an Acceptance Certificate lor the
Equipment under such Lease as indicated in Section 3,04(b).
"Vendor" means the manufacturer or supplier of the Equipment or any other person as
well as the agents or dealers of the manufacturer or supplier from whom Lessor arranged
Lessee's acquisition and linancing of the Equipment pursuant to the applicable Lease.
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2010-90
ARTICLE II
Section 2,01. Representations and Covenanls of'Lessee, Lessee reprcscnts, covenants
and warrants for the benefit of Lessor on the date hereof and as of the Commenccment Date of
each Lease as follows:
(a) Lessee is a state or a political subdivision thereof within the meaning of
Section I 03( c) of the Code, duly organized and existing under the constitution and laws of the
State with full power and authority to enter into this Agreement and each Lease and the
transactions contemplated hereby and to perform all of its obligations hereunder and under each
Lease, .
(b) Lessee has duly authorized the execution and delivery of this Agreement and each
Lease by proper action of its governing body at a meeting duly called, regularly convened and
attended throughout by the requisite quorum of the members thereof, or by other appIopriate
official approval, and all requirements have been met and procedures have occurred in order to
ensure the validity and enforceability of this Agreement and each Lease,
(c) No event or condition that constitutes, or with the giving of notice or the lapse of
time or both would constitute, an Event of Default exists at the date hereof.
(d) Lessee will do or cause to be done all things necessary to preserve and keep in full
force and effect its existence as a body corporate and politic,
(e) Lessee has complied with such public bidding requirements as may be applicable
to this Agreement and each Lease and the acquisition by Lessee ofthe Equipment as provided in
each Lease, .
(f) During the Lease Term, the Equipment will be used by Lessee only for the
purpose of performing essential governmental or proprietary functions of Lessee consistent with
the permissible scope of Lessee's authority, Lessee does not intend to sell or otherwise dispose
of the Equipment or any interest therein prior to the last Rental Payment (including all Renewal
Terms) scheduled to be paid under each Lease,
(g) Lessee has kept and throughout the Lease Term of any Lease shall keep, its books
and records in accordance with generally accepted accounting principles and practices
consistently applied, and shall deliver to Lessor (i) annual audited financial statements (including
(I) a balance sheet, (2) statement of revenues, cxpenses and changes in flmd balances for budget
and actual, (3) statement of cash flows and notes, and (4) schedules and attaclunents to the
financial statemcnts) within 180 days of its fiscal end, (ii) such other financial statements, and
information as Lessor may reasonably requcst and (iii) its annual budget for the following fiscal
year when approved but not later thail 30 days prior to its current fiscal year end, The financial
statements described in subsection (i) shall be accompanied by an unqualified opinion of
Lessees's auditor. Credit information relating tot Lessee may be disseminated among Lessor and
any of its affiliates and any oftheir respective successors and assign,
(h) Lessee has an immediate need for the Equipment listed on each Schedule and
expects to make immediate use of the Equipment listed on each Schedule, Lessee's need for the
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201 0-90
Equipment is not temporary and Lessee does not expect the need for any item of the Equipment
to diminish during the Lease Term to such item,
(i) The paymcnt of the Rental Pa)1nents or any portion thereof is not (under the temlS
of any Lease or any underlying arrangement) directly or indirectly (x) secured by any interest in
propcrty used or to be used in any activity carried on by any person other than a state or local
governmental unit or payment in respect of such property; or (y) on a present value basis, dcrivcd
from payments (whether or not to Lessee) in respect of property, or borrowed money, used or to
be used in any activity carried on by any person other than a state or local governmental unit.
The Equipment will not be used, directly or indirectly, in any activity carried on by any p'erson
other than a state or local governmental unit. No portion of the Equipment Cost for the
Equipment will be used, directly or indirectly, to make or finance loans to any person other than
Lcssee, Lessee has not entered into any management or other service contract with respect to the
use and operation of the Equipment.
(j) There is no pending litigation, tax claim, proceeding or dispute that may adversely
affect Lessee's tinancial condition or impairs its ability to perform its obligation hereunder.
Lessee will, at its expense, maintain its legal existence in good standing and do any further act
and execute, acknowledge, deliver, file, register and record any further documents Lessor may
reasonably request in order to protect Lessor's security interest in the Equipment and Lessor's
rights and benefits under this Lease.
ARTICLE III
Section 3,01, Lease of Equipment, Subject to the terms of this M,aster Lease, Lessor
agrees to provide the funds specified in each Lease to be provided by it to acquire the Equipment,
up to an amount equal to the Maximum Equipment Cost. Upon the execution of each Lease,
Lessor demises, leases, transfers and lets to Lessee, and Lessee acquires, rents and leases from
Lessor, the Equipment as set forth in such Lease and in accordance with the terms thereof. The
Lease Term for each Lease may be continued, solely at the option of Lessee, at the end of the
Original Term or any Renewal Term for the next succeeding Renewal Term up to the maximum
Lease Term set forth in such Lease. At the end of the Original Term and at the end of each
Renewal Term until the maximum Lease Term has been completed, Lessee shall be deemed to
have exercised its option to continue each Lease for the next Renewal Term unless Lessee shall
havc tcnninated such Lease pursuant to Section 3.03 or Section 10,01. The terms and conditions
during any Renewal Tenn shall be the same as the terms and conditions during the Original
Tenn, except that the Rental Paymcnts shall bc as provided in the applicable Lease,
Section 3,02, Continuation of Lease Term, Lessee intends, subject to Section 3,03, to
continue the Lease Tcnn of each Lease and to pay the Original Tenn and all Renewal Terms.and
to pay the Rental Payments thereund~L Lcssee affirms that sufficient funds are available for the
current fiscal year, and Lessee reasonably believes that an amount sufficient to makc all Rental
Payments during the entire Lease Term of each Lease can be obtained from legally available
funds of Lessee, Lessee further intcnds to do all things lawfully within its power to obtain and
maintain funds sufficient and available to discharge its obligation to make Rental Payments due
hcreunder, including making provision for such payments to the extent necessary in each budget
or appropnation request submitted and adopted i!1 accordance with applicable provisions of law,
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to have such pOliion of the budget or appropriation request approved and to exhaust all available
reviews and appeals in the event such portion of the bUdget or appropriation request is not
approved,
Section 3JJ3, Abatement. During any peliod 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 defcct with respect to any Equipment, there is substantial
interference with the use and posscssion by Lessee of such Equipment, the rent applicable to such
Equipment shall be abated proportionately in whole or in part, Lessee shall immechately notify
Lessor upon the occurrence of any event causing substantial interference with Lessee's ltSe and
possession of any Equipment, and such notice shall be provided prior to the abatement of any
rent. The amount of abatement shall be such that the remaining rental obligation lor each rental
period represents fair consideration for the use and possession of the portions of the Equipment
that are not affected by such interference. Such abatement shall commence on the date that
Lessee's use and possession of the affected Equipment is restricted because of such interference
and end on the earlier of (i) the date on which the use and possession thereof are restored to
Lessee, or (ii) the date on which Lessee either (x) replaces the affected Equipment or (y) uses the
proceeds of insurance or condemnation award to pay the applicable Purchase Price therefor.
Notwithstanding any such interference with Lessee's use and possession of a portion of the
Equipment, this Lease shall continue in full force and effect with respect to any remaining
Equipment. Lessee waives the benefits of Civil Code Sections 1932 and any and all other rights
to terminate this Lease by virtue of any interference with the use and possession of any
Equipment.
Section 3,04, Conditions to Lessor's Performance.
(a) As a prerequisite to the performance by Lessor of any of its obligations pursuant
to any Lease, Lessee shall deliver to Lessor the following'
(i) A fully completed Schedule, executed by Lessee;
(ii) An Acquisition Fund Agreement, executed by Lessec and the Acquisition
Fund Custodian, unless Lessor pays 100% of the Acquisition Amount directly to the
Vendor upon execution of the Lease;
(iii) A Certificate executed by the Clerk or Secretary or othcr comparable
officer of Lessee, in substantially the form attached hereto as Exhibit C, completed to the
satisfaction of Lessor;
(iv) A certified copy of a resolution, ordinance or othcr ofticial action of
Lessee's govcrning body authorizing the execution and delivery of this Least. and
perfornlance by Lessee of its bbligations hereunder;
(v) An opinion of counsel to Lessec in substantially the 1,)Ill] attached hcreto
as Exhibit D respecting such Leasc and otherwise satisfactory to Lcssor:
(vi) Evidence of insurance as required by SeCtion 7,02 hereof;
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(vii) All documents, including financing statements, affidavits, notices and
similar instnlInents, in limn satisbctory to Lessor, which Lessor deems necessary or
appropriate at that time pursuant to Section (',02;
(viiI) A copy of a fully completed and executed Fornl 8038;
(ix) If any Equipment units arc motor vehiclcs, properly competed certificates
oftitle for such vehicles; and
(x) Such other itenls, if any, as are set forth in such Lease or are reasonably
required by Lessor. v
(b) In addition, the performance by Lessor of any of its obligations pursuant to any
Lease shall be subject to: (i) no material adverse change in the financial condition of Lessee since
the date of this Lease, (ii) no Event of Default having occurred, and (iii) if no Acquisition Fund
has been established, the Equipment must be accepted by Lessee no later than date listed as the
Utilization Period Expiration in the applicable Schedule.
(c) Subject to satisfaction of the foregoing, Lessor will pay the Acquisition Amount
for Equipment described in a Schedule to the Vendor or, if authorized by Lessee's governing
body, will reimburse Lessee for the prior payment of any such Acquisition Amounts by Lessee to
the Vendor, upon receipt of the documents described in Sections 5.01(a) and (b); or if an
Acquisition Fund has been established pursuant to an Acquisition Fund Agreement, Lessor will
deposit the Acquisition Amount for Equipment dcscribed in the Schedule with the Acquisition
Fund Custodian.
(d) This Agreement is not a commitment by Lessor to enter Into any Lease not
currently in existence, and nothing in this Agreement shall bc construed to impose any obligation
upon Lessor to enter into any proposed Lease, it being understood that whether Lessor enters into
any proposed Lease shall be a decision solely within Lessor's discretion,
(e) Lessee will cooperate with Lessor in Lessor's review of any proposed Lease.
Without limiting the foregoing, Lessee will provide Lessor with any documentation or
information Lessor may request in connection with Lessor's review of any proposed Lease. Such
documentation may include, without limitation, documentation conccrning the Equipment and its
contemplated use and location and documentation or infomlation concerning the financial status
of Lessee and other matters related to Lessee,
ARTICLE IV
Scction 401. Rental Paymcnls. Subject to Section 3,03, Lessee shall promptly'pay
Rental Payments, in lawful money of the United States of America, to Lessor on the dates and in
such amounts as provided in each Lease, Lessee shall pay Lcssor a charge on any Rental
Payment not paid on the date such payment is due at the rate equal to the Contract Rate plus 5%
per annum or the maximum amount pennitted by law, whichever is less, from such date, Lessee
shall not pennit the federal government to guarantee any Rental Payments under any Lease.
Rental Payments consist of pnncipal and interest pa}111ents as more fully detailed on each
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Schcdule, thc interest on which hegins to accmc as of the Commencement Date for each such
Schedule,
Sectiun 4,02, Intercst and Principal Cumpunents, A portion of each Rental Payment is
paid as, and represents payment ot~ interest, and the Balance of each Rental Payment is paid as,
and represents payment of, plincipaL Each Lease shall set forth the principal and interest
components of each Rental Payment payable thereunder during the Lcase Tenn.
Section 4,03, Rental Payments to Constitllte a ClIrrent Expense of Lessee, Lessor and
Lessee understand and intend that the obiigation of Lessee to pay Rental Payments under each
Lease shall constitute a currcnt expense of Lessee payable solely from its general fund or other
funds that are legally available for that purpose and shall not in any way be constmed to be a debt
of Lessee in contravention of any applicable constitutional or statutory limitation or requirement
concerning the creation of indebtedness by Lessee, nor shall anything contained herein or in a
Lease constitute a pledge of the general tax revenues, funds or moneys of Lessee,
Section 4.04, Rental Payments to be Unconditional. Except as provided in Section 3.03,
the obligations of Lessee to make Rental Payments and to perform and observe the other
covenants and agreements contained in each Lease shall be absolute and unconditional in all
events without abatement, diminution, deduction, set-off or defense, for any reason, including
without limitation any failure of the Equipment, after it has been accepted by lessee, any defects,
malfunctions, breakdowns or infirmities in the equipment or any accident, condemnation or
unforeseen circumstances. Lessee's obligations to make Rental Payments or pay other amounts
hereunder shall not be abated on account of obsolescence or failure of the Equipment to perform
as desired.
Section 4,05, Tax Covenant. Lessee agrees that it will not take any action that would
cause the interest component of Rental Payments to be OJ to become ineligible for the exclusion
from gross income of the owner or owners thereof for federal income tax purposes, nor will it
omit to take or cause to be taken, in timely manner, any action, which omission would cause the
interest component of Rental Payments to be or to become ineligible for the exclusion from gross
income of the owner or owners thereof for federal income tax purposes,
Section 4,06, Event of Taxability, Upon the occurrence of an Event of Taxability, the
interest component shall be at a Taxable Rate rctroactive to the date as of which the interest
component is determined by the Intemal Revenue Service to he includible in the gross income of
the owner or owners thereof tor federal income tax purposes, and Lessee will pay such additional
amount as will result in the owner receiving the intcrest component at the Taxable Rate identitled
in the related Lease,
For purposes of this Section, "Evcnt of Taxability" means a deternlination that the
interest component is includible for federal income tax purposes in the gross income of thc
owner thereof due to Lessee's action or failure to take any action.
Section 4,07. Mandatory Prepayment. If the Lease Proceeds are deposited into an
Acquisition Fund, any funds remaining in the Acquisition Fund on or after the Acquisition
Period and not applied to Equipment Costs, shall be applied, in Lessor's discretion hased upon
the amount remaining in such Fund, on the next Rental Payment date to eithcr: (i) all or a portion
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of the next Rcntal Payment and if such amount is in excess of the next Rental Payment then, any
remaining balance shall be applied to all or a portion of the next succeeding Rental Payments
until fully applied; or (ii) as prepaY111ent to the remaimng principal balance owing under the
Schedule in the inverse order of maturity.
ARTICLE V
Section 5,01. DelivClY. Installation and Acceptance afEquipment.
(a) Lessee shall order the Equipment, cause the Equipmcnt to be delivered and
installed at the location specified in the Leases and pay any and all delivery and installation costs
and other Equipment Costs in connection therewith. When the Equipment listed in any Lease
has been delivered and installed, Lessee shall promptly accept such Equipment and evidence said
acceptance by executing and delivering to Lessor an acceptance certificate in the form attached
hereto as Exhibit E.
(b) Lessee shall deliver to Lessor original invoices and bills of sale (if title to such
Equipment has passed to Lessee) relating to each item of Equipment accepted by Lessee. With
Iespect to Equipment not purchased through an Acquisition Fund, Lessor shall, upon receipt of
an Acceptance Certificate from Lessee, prepare a Schedule of Property and Rental Payment
Schedule W the forms attached hereto as Exhibits B-1 and B-2, Lessee shall execute and deliver
such Schedules to Lessor within 5 business days of receipt.
Section 5,02. Quiet Enjoyment of Equipment, So long as Lessee is not in default under
the related Lease, neither Lessor nor any entity claiming by, through or, under Lessor, shall
interfere with Lessee's quiet use and enjoyment of the Equipment during the Lease Term,
Section 5,03. Location; Inspection. Once installed, no item of the Equipment will be
relocated from the base location specified for it in the Lease on which such item is listed without
Lessor's consent, which consent shall not be unreasonably withheld, Lessor shall have the right
at all reasonable times during regular business hours to enter into and upon the property of
Lessee for the purpose of inspecting the Equipment.
Section 5,04, Use and Maintenance of the Equipment, Lessee will not install, use,
operate, or maintain the Equipment improperly, carelessly, in violation of any applicable law or
in a marmer contrary to that contemplated by the related Lease, Lesscc shall provide all permits
and licenses, if any, necessary for the installation and operation of the EqUIpment. In addition,
Lessec agrces to comply in all respects with all applicable laws, regulations and rulings of any
legislative, executive, administrative, or judicial body; providcd that Lessee may contest in good
faith the validity or application of any such law, regulation or ruling in any reasonable m'lnner
that does not, in the opinion of Lessor, adversely affect the interest (including the reversionary
interest) of Lessor in and to the Equipment or its interest or rights under the Lease.
Lessee agrees that it will maintain, preserve, and keep thc Equipment in good repair and
working order, in a condition comparable to that recommended by the manuhlcturcL Lcssor
shall have no responsibility to maintain, rcpair or make improvcmcnts or additions to the
Equipment. In all cases, Lessee agrees to pay any costs necessary for the manufacturer to rectify
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thc Equipment as eligible for manuf"eturer's maintenance upon the return of the Equipment to
Lessor as provided tor herein,
Lessee shall not alter any item of Equipment or install any accessory, equipment or device
on an ,tem of Equipment if that would impair any applicable warranty, the originally intended
function or the value of that Equipment. All repairs, parts, accessories, equipment and devices
furnished, affixed to or installed on any Equipment, excluding temporary replaccments, shall
thereupon become subject to the interest of Lessor therein.
ARTICLE VI
.'
Section 6,01. Title to the Equipment. During each Lease Term, and so long as Lessee is
not in default under Article XII hereof, all right, title and interest in and to each item of the
Equipment shall be vested in Lessee immediately upon its acceptance of each item of Equipment,
subject to the terms and conditions of the applicable Lease. Lessee shall at all times protect and
defend, at its own cost and expense, its title in and to the Equipment from and against all claims,
liens, and legal processes of its creditors, and keep all Equipment free and clear of all such
claims, liens, and processes. Upon the occurrence of an Event of Default or upon termination of
a Lease pursuant to Section 3.03 hereof, full and unencumbered legal title to the Equipment shall
pass to Lessor, and Lessee shall have no further interest therein, In addition, upon the
occurrence of such an Event of Default or such termination, Lessee shall execute and deliver to
Lessor such documents as Lessor may request to evidence the passage of such legal title to
Lessor and the termination of Lessee's interest therein, and upon request by Lessor shall deliver
possession of the Equipment to Lessor in accordance with Section 12.02, Upon purchase of the
Equipment under a Lease by Lessee pursuant to Section 10.01, Lessor's security interest or other
interest in the Equipment shall terminate, and Lessor shall execute and deliver to Lessee such
documents as Lessee may request to evidence the termination of Lessor's security interest in the
Equipment subject to the related Lease.
Section 6,02, Security Interest. To secure the payment of all of Lesssee's obligations
under each Lease, upon the execution of such Lease, Lessee grants to Lessor a security interest
constituting a first lien on (a) the Equipment:applicable to such Lease, (b) moneys and
investments held from time to time in the Acquisition Fund and (c) any and all proceeds of any of
thc foregoing, Lessec agrees to execute and authorizes Lessor to file such notices of assignment,
chattel mortgages, financing statements and other documents, in form satisfactory to Lessor,
which Lessor deems necessary or appropriatc to establish and maintain Lessor's security interest
in the Equipment. the Acquisition Fund and the proceeds thereof
Section 603 Personal Property, The Equipment is and will remain personal property
and will not be decmed to be allixed to or a part of the real estate on which it may be situated
notwithstanding that the Equipment or any part thereof may be or hereafter become in any
maImer physically affixed or attached to real estate or any building thercon, Upon the request of
Lessor, Lessee will, at Lessee's expense, furnish a waiver of any interest in the Equipment from
any party having an interest in any such real estate or building,
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ARTICLE VII
Section 7,()J. Liens, Taxes. Other Governmental Charges and [Trdity Charges. Lessee
shall keep the Equipment fTee of alllcvies, liens, and encumbrances except those created by each
Lease, The parties to this Ah'Tecment contcmplate that the Equipment will be used for a
governmental or proprietary purpose of Lessce and that the Equipment will therefore be exempt
from all property taxes, If the use, possession or acquisition of any Equipment is nevertheless
determined to be subject to taxation, Lessee shall pay when due all taxes and governmental
charges lawfully assessed or levied against or with respect to such Equipment. Lessee shall pay
all utility and other charges incurred in the use and maintenance of the Equipment. Lessee-shall
pay such taxes or charges as the same may become due; provided that, with respect to any such
taxes or charges that may lawfully be paid in installments over a period of years, Lessee shall be
obligated to pay only such installments as accrue during each Lease Term.
Section 7. 02, Insurance. Lessee covenants that it is an authorized self-insured public
entity for purposes of general liability, automobile liability, worker's compensation and property
coverage including but not limited to rental interruption coverage in an amount which shall cover
Rental Payments for no less than 24 months in the event Lessee exercises it rights to abate any
Rental Payments or portions thereof pursuant to Section 3.03 of the Agreement and warrants that
through its program of self-insurance, it has adequate coverage or resources to protect against
liabilities arising out of the terms, conditions and obligations of this Agreement. Lessee shall
furnish to Lessor evidence of such self-insurance coverage through each Lease Term. Lessee
shall not cancel or modify such self-insurance coverage in any way that would affect the interests
of Lessor without first giving written notice thereof to Lessor at least 30 days in advance of such
cancelled or modification,
Section 7,03 Risk of Loss, Subject to Section 3,03, whether or not covered by
insurance of self-insurance, Lessee hereby assumes all risk of loss of, or damage to and liability
related to injury or damage to any person or property arising from the Equipment from any cause
whatsoever, and no such loss of or damage to or liability arising from the Equipment shall relieve
Lessee of the obligation to make the Rental Payments or to perform any other obligation under
this Lease, Whether or not covered by insurance or self-insurance, Lessee hereby agrees to
reimburse Lessor (to the fullest extent permitted by applicable law, but only from legally
available funds) for any and all liabilities, obligations, losses, costs, claims, taxcs or damages
suffered or incurred by Lessor, regardless of the cause thereof and all expenses incurred in
connection therewith (including without limitation, counsel fees and expcnses, and penalties
connected therewith imposed on interest receive) arising out of or as s result of (a) entering into
of this Agreement or any of the transactions contemplated hereby, (b) the ordering, acquisition,
ownership usc, operation, conditions, purchase, delivery, acceptancc, rejection, storage or retum
of any item the Equipment, (c) any accident in conncction with the operation, use, condition,
possession, storage or return of any,item of the Equipment rcsulting in damage to property or
injury to or death to any person, andlor (d) the breach of any covenant of Lessee in connection
with a Lease or any material misrepresentation provided by Lessee in connection with a Leasc,
The provisions of this paragraph shall continue in full force and effect notwithstanding the full
payment of all obligations under all Leases or the termination of the Lease Tenn under Lease for
any reason,
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See/ion 7.(J4 Advunces In the evcnt Lessee shall filii to keep the Equipment in good
repair and working order, Lessor may, but shall be under nCl obligation to, maintain and repair the
Equipment and pay the cost thcreof All amounts so advanccd hy Lessor shall constitute
additional rent for the then current Original Ternl or Renewal Term and Lessee covcnants and
agrees to pay such amounts so advanced by Lessor with interest thereon from the duc date until
paid at a rate equal to the Contract Rate plus 5% pcr annum or the maximum amount pennittcd
by law, whichever is less..
ARTICLE VIII
Section 8.01. Damage, Destruction and Condemnation. Unless Lessee shall have
exercised its option to purchase the Equipment by making payment of the Purchase Price as
provided in the related Lease, if, prior to the tcnnination of the applicable Lease Term, (a) the
Equipment or any portion thereof is destroyed, in whole or in part, or is damaged by fire or other
casualty or (b) title to, or the temporary use of, the Equipment or any part thereof shall be taken
under the exercise or threat of the power of eminent domain by any governmental body or by any
person, firm or corporation acting pursuant to governmental authority, Lessee and Lessor will
cause the Net Proceeds of any insurance claim or condemnation award or sale under threat of
condemnation to be applied to the prompt replacement, repair, restoration, modification or
improvement of the Equipment. Any balance of the Net Proceeds remaining after such work has
been completed shall be paid to Lessee,
If Lessee elects to replace any item of the Equipment (the "Replaced Equipment")
pursuant to this Section, the replacement equipment (the "Replacement Equipment") shall be of
similar type, utility and condition to the Replaced Equipment and shall be of equal or greater
value than the Replaced Equipment. Lessor shall receive a first priority security interest in any
such Replacement Equipment. Lessee shall represent, warrant and covenant to Lessor that each
item of Replacement Equipment is free and clear of all claims, liens, security interests and
encumbrances, excepting only those liens created by or through Lessor, and shall provide to
Lessor any and all documents as Lessor may reasonably request in connection with the
replacement, including, but not limited to, documentation in f0fl11 and substance satisfactory to
Lessor evidencing Lessor's security interest in the'Replacement Equipment.
Lessor and Lessee hereby acknowledge and agree that any Replacement Equipment
acquired pursuant to this paragraph shall constitute "Equipment" for purposes of this Agreement
and the related Lease, Lessee shall complete the documentation of Replacement Equipment on
or before the next Rent Payment date after thc occunence of a casualty event, or be required to
exercise the Purchase Option WIth respcct to thc damagcd equipmcnt.
For purposes of this Article, the term "Net Proceeds" shall mean the amount rcmaining
from the gross proceeds of any insurancc claim or condemnation award or sale under threat of
condemnation after deducting all cxpenses, including attorneys' fees, incurred in the collection
thereof
Section 8.02, InsuffiCiency olNet Proceeds, If the Nct Proceeds arc insufficient to pay in
full the cost of any repair, restoration, modification or improvemcnt referred to in Section 8,01,
Lessee shall either (a) complete such replacement, repair, restoration, modification or
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improvement and pay any costs thereof in excess of the amount of the Net Proceeds, or (b) payor
cause to be paid to Lessor the amount of thc then applicahle Purchase Price for the Equipment,
and, upon sucli payment, the applicable Lease Tenn shall tenninate and Lessor's interest in the
Equipment shall tenninate as provided in Section 6.01 hereof. The amount ofthc Net Proceeds,
if any, remaining after complcting such repair, restoration, modification or improvement or after
purchasing such Equipment and such othcr Equipment shall be retained by Lessee, If Lcssee
shall make any payments pursuant to this Section, Lessee shall not be entitled to any
reimbursement therefor ti-om Lessor nor shall Lessee be entitled to any diminution of the
amounts payable undcr Al1iele IV,
ARTICLE IX
Section 9,01, Disclaimer of Warranties, Lessor makes no warranty or representation,
either express or implied, as to the value, design, condition, merchantability or fitness for
particular purpose or fitness for use of the Equipment, or any other warranty or representation,
express or implied, with respect thereto and, as to Lessor, Lessee's acquisition of the Equipment
shall be on an "as is" basis. In no event shall Lessor be liable for any incidental, indirect, special
or consequential damage in connection with or arising out of this Agreement, any Lease, the
Equipment or the existence, furnishing, functioning or Lessee's use of any item, product or
service provided for in this Agreement Lease or any Lease.
Section 9,02, Vendor's Warranties. Lessor hereby irrevocably appoints Lessee its agent
and attorney-in-fact during each Lease Term, so long as Lessee shall not be in default under the
related Lease, to assert ti-om time to time whatever claims and rights (including without
limitation warranties) relating to the Equipment that Lessor may have against Vendor. Lessee's
sole remedy for the breach of such warranty, indemnification or representation shall be against
Vendor of the Equipment, and not against Lessor. Anysuch matter shall not have any effect
whatsoever on the rights and obligations of Lessor with respect to any Lease, including the right
to receive full and timely payments under a Lease. Lessee expressly acknowledges that Lessor
makes, and has made, no representations or warranties whatsoever as to the existence or the
availability of such warranties by Lessor of the Equipment.
ARTICLE X
Section 10,01. Purchase Option, Lessee shall have the option to purchase all of the
Equipment listed in a Lease, upon giving written notice to Lessor at least 30, but not more than
120, days bet(lrc the date of purchase, at the following times and upon the following tenns:
(al From and after the date specified in thc related Schedule (the "Purchase Option
Commencement Date "), on the RentSl Payment dates specified in each Lease, upon payment in
full of the Rental Payments then due under such Lease plus thc then applicable Purchase Price,
which may include a prepayment premium on the unpaid balance as set f()[th in the applicable
Schcdulc: or
(b) In the event of substantial damage to or destruction or condemnation of
substantially all of the Equipment listed in a Lease, on the day specified in Lessee's notice to
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Lessor of its exercise of the purchase option upon payment in lull to Lessor of the Rental
Payments then due under such Lease plus the then applicable Purchase Price: or
(c) Upon the expiration of the Lease Term, upon payment in lull of all Rental
Payments then due and all other amounts then owing undcr the Leasc, and the payment of $1,00
to Lessor.
After payment of the applicable Purchase Price, Lessee will own the rclated Equipment,
and Lessor's right, titlc and interests in and to such Equipmcnt will bc transferred and terminated
in accordance with Section 6.01.
.
ARTICLE XI
Section ]],01. Assignment by Lessor,
(a) Lessor's right, title and interest in and to Rental Payments and any other amounts
payable by Lessee under any and all of the Leases, its security interest in the Equipment subject
to each such Lease, and all proceeds therefrom may be assigned and reassigned in whole or in
part to one or more assignees or subassignees by Lessor, without the necessity of obtaining the
consent of Lessee; provided. that any such assigrunent, transfer or conveyance to a trustee for the
benefit of owners of certificates of participation shall be made in a manner that conforms to any
applicable State law. Nothing in this Section 11.01 shall be construed, however, to prevent
Lessor from executing any such assigrunent, transfer or conveyance that does not involve funding
through the use of certificates of participation within the meaning of applicable State law,
including any such assigrunent, transfer or conveyance as part of a multiple asset pool to a
partnership or trust; provided such certificates are sold only on a private placement basis (and not
pursuant to any "public offering") to a purchaser(s) who represent that (i) such purchaser has
sufficient knowledge and experience in financial and business matters to be ablc to evaluate the
risks and merits of the investment, (ii) such purchaser understands neither the Lease nor
certificates will be registered under the Securities Act of 1933, (iii) such purchascr is either an
"accredited investor" within the meaning of Regulations D under the Securities Act of 1933, or a
qualified institutional buyer within the meaning of Rule 144A, and I(iv) it is the intention of such
purchaser to acquirc such certificates (A) for investment for its own account or (B) for resale in a
transaction exempt from rcgistration under the Securities Aet of 1933; providcd further, that in
any event, Lessee shall not be required to make Rental Payments, to send noticcs or to otherwise
deal with respect to matters arising under a Lease with or to morc than one individual on entity,
(b) Unless to an affiliatc controlling, controlled by or under common control with
Lessor, no assignment, transfer or conveyance permitted by this Section 110 I shall he effective
until Lcssee shall have received a ;vritten notice of assignment that discloses the !Jame' and
address of each such assignee; provided, that if such assignment is made to a hank or tmst
company as tmstee or paying agent for owners of certificates of participation, tmst certificates or
partnership interests with respect to the Rental Payment payable under a Lease, it shall thereafter
be sufficient that Lessee receives notices of the name and address of the bank or trust company as
tmstree or paying agent. During eaeh Lease Term, Lessee shall keep, or cause to he kept a
complete and accurate record of all such assignments in foml necessary to comply with Scctopm
149 of the Code. Lessee shall retain all such notices as a register of all assignees and shall make
t-/765674vl (BAPCClCA Abatement Lease Template) 14
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ail payments to the assignee or assignees designated in such register. Lessee shall not have the
right to and shall not assert against any assignee any claim, counterclaim or other right Lessec
may have against Lessor or the Vendor. Assignments in part may includc without limitation
assignment of all of Lessor's security interest in and to the Equipment listed in a particular Lease
and all rights in, to and under the Lease related to such Equipment. The option granted in this
Section may be scparately exercised from time to time with respect to the Equipment listed in
cach Lease, but such option does not pennit the assignment of less than all of Lessor's interests
in the Equipment listed in a single Lease,
(c) If Lessor notifies Lessee of its intcnt to assign the Lease, Lessee agrees thatjt shall
executc and deliver to Lessor a Notice and Aeknowledgcment of Assigmnent substantially in the
form of Exhibit F attached to this Lease within five (5) business days after its receipt of such
request.
Section 11,02, Assignment and Subleasing by Lessee. None of Lessee's right, title, and
interest in, to and under any Lease or any portion of the Equipment may be assigned or encum-
bered by Lessee for any reason.
ARTICLE XII
Section 12.01. Events of Default Defined, Any of the following events shall constitute an
"Event of Default" under a Lease:
(a) Failure by Lessee to pay any Rental Payment or other payment required to be paid
under any Lease at the time specified herein;
(b) Failure by Lessee to observe and perfofIll any covenant, condition or agreement
on its part to be observed or performed, other than as referred to in subparagraph (a) above, for a
period of 30 days after written notice specifying such failure and requesting that it be remedied is
given to Lessee by Lessor, unless Lessor shall agree in writing to an extension of such time prior
to its expiration; provided that, if the failure stated in the notice cannot be corrected 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 default is corrected;
(c) Any statement, representation or warranty made by Lessee in or pursuant to any
Lease or its execution, delivery or perfonnance shall prove to have been false, incorrect,
misleading, or breached in any matcrial respect on the date when made;
(d) Any dcfault occurs under any other agrecment with Bank of Anlerica, N.A, apd its
affiliates for borrowing money, lea'se financing of property or otherwise receiving credit under
which Lessee is an obligor under which there is outstanding, owing or committed an aggregate
amount of a least 10% of Lessee's aggregate current long- and short-term indebtedness, if such
default consists of (i) thc failure to pay any indebtedness when due or (ii) the failure to perfonn
any other obligation thereunder and gives the holder of the indcbtedness the right to accelerate
the indebtedness;
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(e) Lessee shall (i) apply for or consent to the appointment of a recciver, trustee,
custodian or liquidator of Lessce, or of all or a substanti,il part of the assets of Lessec, (ii) be
unable, fail or admit in writing its inability gcnerally to pay its dcbts as they become due,
(iii) make a general assignmcnt for the benefit of creditors, (Iv) have an order for relief entered
against it under applicable federal bankruptcy law, or (v) tile a voluntary petition in bankruptcy
or a petition or an answer seeking reorganization or an arrangement with creditors or taking
advantage of any insolvency law or any answer admitting the material allegations of a petition
filed against Lessee in any bankruptcy, reorganization or insolvency proceeding; or
(f) An ordcr, judgment or decree shall bc cntered by any court of cOl1lPetent
jurisdiction, approving a petition or appointing a rcceiver, trustee, custodian or liquidator or
Lessee or of all or a substantial part of the assets of Lessee, in each case without its application,
approval or consent, and such order, judgment or decree shall continue unstayed and in effect for
any period of 30 consecutive days,
Section 12,02. Remedies on Default. Whenever any Event of Default exists, Lessor shall
have the right, at its sole option without any further demand or notice, to take one or any
combination of the following remedial steps:
(a) By written notice to Lessee, Lessor may declare all Rental Payments payable by
Lessee pursuant to such Lease and other amounts payable by Lessee under such Lease to the end
of the then current Original Term or Renewal Term to be due;
(b) With or without terminating the Lease Term under such Lease, Lessor may enter
the premises where the Equipment listed in such Lease is located and retake possession of such
Equipment or require Lessee at Lessee's expense to promptly return any or all of such Equipment
to the possession of Lessor at such place within the United States as Lessor shall specify, and sell
or lease such Equipment or, for the account of Lessee, sublease such Equipment, continuing to
hold Lessee liable, but solely from legally available funds, for the difference between (i) the
Rental Payments payable by Lessee pursuant to such Lease and other amounts related to such
Lease or the Equipment listed therein that are payable by Lessee to the end of the then current
Original Term or Renewal Term, as the case may be, and (ii) the net proceeds of any such sale,
leasing or subleasing (after deducting all expenses of Lessor in exercising its remedies under
such Lease, including without limitation all expenses of taking possession, storing,
reconditioning and selling or leasing such Equipment and all brokerage, auctioneer's and
attorney's fees), subject, however, to the provisions of Section 3,03, The exercise of any such
remedies respecting any such Event of Default shall not relieve Lessee of any other liabilities
under any othcr Lease or the Equipment listed therein;
(c) Lessor may take whatever action at law or in equity may appear necessary or
desirable to enforce its rights und",r such Lease Or as a secured party in any or all of the
Equipment subject to such Lease: and
(d) by action pursuant to the California Code of Civil Procedure, or as otherwise
provided by law, obtain the issuance of a writ of mandamus enforcing, for the entire balance of
the remaining Lease Tenn, the duty of Lessec to appropriate and take all other administrative
steps necessary for the payment of rents, and other amounts due hereunder.
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Section 12,03, No Remedy Etclusive, No remedy herein conferred upon or reserved to
Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in
addition to every other remedy given under a Lease no'" or hereafter existing at law or in equity,
No delay or omission to exercise any right or power accrumg upon any default shall impair any
such right or power or shall be construed to be a waivcr thereof, but any such right or power may
be exercised from time to time and as often as may be deemed expedient. In order to cntitle
Lessor to exercise any remedy reserved to it in this Article it shall not be necessary to give any
notice other than such noticc as may be required in this Article,
Section 12.04, Application of Moneys, Any net proceeds from the exercise ..f any
remedy under this Agreement, including the apphcation specified in Section l2,02(b)(ii) (after
deducting all expenses of Lessor in exercising such remedies including without limitation all
expenses of taking possession, storing, reconditioning and selling or leasing Equipment and all
brokerage, auctioneer's or attorney's fees), shall be applied as follows:
(a) If such remedy is exercised solely with respect to a single Lease, Equipment listed
in such Lease or rights thereunder, then to amounts due pursuant to such Lease and other
amounts related to such Lease or such Equipment.
(b) If such remedy is exercised with respect to more than one Lease, Equipment listed
in more than one Lease or rights under more than one Lease, then to amounts due pursuant to
such Leases pro rata,
ARTICLE XIII
Section 13.0J. Notices. All notices, certificates or other communications under any
Lease shall be sufficiently given and shall be deemed given when delivered or mailed by
registered mail, postage prepaid, or delivered by overnight courier, or sent by facsimile
transmission (with electronic confirmation) to the parties hereto at the addresses immediately
after the signatures to this Agreement (or at such other address as either party hereto shall
designate in writing to the other for notices to such party) and to any assignee at its address as it
appears on the registration books maintained by Lessee.
Section ]3,02. Binding Effect. Each Lease shall inurc to the benefit of and shall be
binding upon Lessor and Lessee and their respective succcssors and assigns,
Section 13,03, Severability, In the event any provision of any Lease shall be held invalid
or unenforceable by any court of competent jurisdiction, such holding shall not mvalidate or
render unenforceable any other provision hercof
Section ]3,04, Amendments: Changes and l'vfodrjications, This Agreement and each
Lease may only be amcnded by Lcssor and Lessee in writing,
Section 13,0), Execution in Counterparts, This Agreement and each Lease may be
simultaneously executed in several counterparts, each of which shall be an original and all of
which shall constitute but one and thc same instrument.
#765674vl (BAPCCICA Abatement Lease Templale) 17
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Section 13,06, Applicable Law. This Agreement and each Lease shall be governed by
and construed in accordance with the laws of the State,
Seclion J 3,07, Captions. The captions or headings in this Agreement and in each Lease
are for convenience only and in no way define, limit or describe thc scope or intent of any
provisions or sections of this Agreement or any Lease.
IN WITNESS WHEREOF, Lcssor and Lessee have caused this Agrccment to be executed in
their names hy their duly authorized representatives as of the date first above written,
LESSOR:
Bank of America, National Association
555 California Street, 4th Floor
San Francisco, California 94104
LESSEE:
City of San Bernardino
300 North D Street
San Bernardino, CA 92418
~iu, 'It!:!rq;~J.,--
By ~~ ~~~ Ib~
Title A~~istant Vice President
(Seal)
~~es~ h.~
Title City Clerk
:
#7G5674v1 (BAPCC"CA Abatement LC;lSC Template) 18
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SCHEDULE OF PROPERTY No. 3
Re: Master Equipment LeaselPurchase Agreement No, 2114500-06000
dated as of May 10, 2010, between Bank of America, National
Association, as Lessor, and City of San Bernardino, as Lessee
1. Defined Tenns. All terms used herein have the meanings ascribed to them
III the above-referenced Master Equipment LeaselPurchase Agreement (the "Master
Equipment Lease ").
2. Equipment. The following items of Equipment are hereby included under
this Schedule of the Master Equipment Lease.
Various police vehicles
3. Payment Schedule.
(a) Rental Payments. The Rental Payments shall be in such amounts
and payable on such dates as set forth in the Rental Payment Schedule attached to this
Schedule as Exhibit A-I. Rental Payments shall commence on the date on which the
Equipment listed in this Schedule is accepted by Lessee, as indicated in an Acceptance
Certificate substantially in the form of Exhibit B to the Master Equipment Lease or the
date on which sufficient moneys to purchase the Equipment are deposited for that
purpose with an Acquisition Fund Custodian, whichever is earlier.
(b) Purchase Price Schedule. The PUIchase Price on each Rental
Payment date for the Equipment listed in this Schedule shall be the amount set forth for
such Rental Payment date in the "Purchase Price" column of the Rental Payment
Schedule attached to this Schedule. The Purchase Price is in addition to all Rental
Payments then due under this Schedule (including the Rental Payment shown on the
same line in the Rental Payment Schedule).
4. Representations. Warranties and Covenants. Lessee hereby represents,
warrants and covenants that its Iepresentations, warranties and covenants set forth in the
Master Equipment Lease are true and correct as though made on the date of
commencement of Rental Payments on this Schedule. Lessee further represents and
warrants that no material adverse change in Lessee's financial condition has occurred
since the date of the Master Equipment Lease.
5. The Lease. The terms and provisions of the Master Equipment Lease
(other than to the extent that theyrelate solely to other Schedules or Equipment listed on
other Schedules) are hereby incorporated into this Schedule by reference and made a part
hereof
6, Lease Proceeds, The Lease Proceeds which Lessor shall pay to the
Acquisition Fund Custodian in connection with this Schedule is $323,700,00, of which
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$0,00 is for deposit to the Expense Fund and the balance is for deposit to the Acquisition
Fund,
7. Acquisition Period, The Acquisition Period applicable to this Schedule
shall end on May 10,2011.
8.
10,2013,
Lease Term, The Lcase Term shall consist of 36 months, ending on May
9. Purchase Option Commencernent Date. For pUlposes of Section 10.01 of
the Lease, the Purchase Option Commencement Date is May 10,2013.
10. Pre-Payment Premium, On any Rental Payment Date after the first half of
the lease term, Lessee shall have the option to purchase all Equipment under a Schedule
upon payment in full of the Rental Payments then due under such Schedule plus the then
applicable Purchase Price, which will not include a prepayment premium on the unpaid
balance as set forth in the applicable Schedule,
11. Registration. Any Equipment that is a motor vehicle is to be registered and
titled as follows:
Registered Owner:
City of San Bernardino
(a)
(b)
Lienholder:
Bank of America, N. A.
2059 Northlake Parkway
Mail Code GA3-003-04-01
Tucker, GA 30084-5399
Lessee shall be responsible for the correct titling of all Equipment leased hereunder.
Lessee will cause the original Certificates of Title to be delivered to Lessor for retention in
Lessor's files throughout the term of the Lease.
#765674v1 (BAPCCICA Abatement Lease Template) A-2
Dated: May 10,2010
LESSOR:
Bank of America, National Association
555 California Street, 4th Floor
San Francisco, California 94104
BY_~4~ \a~
Assistant Vice President
Title
:
2010-90
#765674vl (BAPCClCA Abatement Lease Template) A-3
LESSEE:
City of San Bernardino
300 North D Street
San Bernardino, CA 92418
, / J/::? /
By WPduf1~bc~
Title Director of Finance
(Seal)
Attest:
Byfl~ b. ~
Title City Clerk
2010-90
EXHIBIT A-1
RENTAL PAYMENT SCHEDULE
Rental Rental Interest
Payment Payment Portion Principal Purchase
Date Amount 3,7800% Portion Balance
5/10/2010 323,700,00
11/10/2010 57,574.46 6.117,93 51,456,53 272,243.47
5/10/2011 57.574.46 5.145.40 52,429.06 219,814.40
11/10/2011 57,574.46 4.154.49 53,419,97 166,394.43
5/10/2012 57.574.46 3.144,85 54,429,61 111,964.82
11/10/2012 57,574.46 2.116.14 55,458.33 56,506.49
5/10/2013 57,574.46 1,067,97 56,506.49 0
TOTAL 345,446,79 21,746,79 323,700,00
Prepayment Premium for purposes of Section 10,01 (a) is 0%.
For purposes of this Lease, "Taxable Rate," with respect to the interest
component of Rental Payments, means an annual rate of interest equal to
5,5048%,
LESSEE:
City of San Bernardino
'L/
By:
Title Director of Finance
2010-90
ACQUISITION FUND AND ACCOUNT CONTROL AGREEMENT
Tbis Acquisition Fund and Account Control Agreement (tbis "Agreement"),
dated as of May 10, 2010, by and among Bank of America, National Association, a
national banking association (hereinafter referred to as "Lessor"), City of San
Bernardino, a political subdivision of the state of California (hereinafter referred to as
"Lessee") and Deutsche Bank National Trust Company, a national trust company
(hereinafter rcfcrred to as "Acquisition Fund Custodian"),
Reference is made to that certain Master Equipment LeaselPurchase Agreement No.
2114500-06000 dated as of May 10, 20 I 0, between Lessor and Lessee (hereinafter referred to as
the "Lease"), covering tbe acquisition and lease of certain Equipment described therein (the
"Equipment"), It is a requirement of the Lease that the Equipment Cost of the Equipment (an
amount not to exceed $323,700.00 be deposited into an escrow under terms satisfactory to
Lessor, for tbe purpose of fully funding the Lease, and providing a mechanism for the
application of such amounts to the purchase of and payment for the Equipment.
The parties agree as follows:
1. Creation of Acquisition Fund.
(a) There is hereby created a special trust fund to be known as the "City of
San Bernardino #2114500-06000 (Schedule No.3) Acquisition Fund" (the "Acquisition Fund")
to be held in trust by the Acquisition Fund Custodian for the purposes stated herein, for the
benefit of Lessor and Lessee, to be held, disbursed and returned in accorc\ance with the terms
hereof.
(b) The Acquisition Fund Custodian shall invest and reinvest moneys on deposit in the
Acquisition Fund in Qualified Investments in accordance with written instructions received from
Lessee. Lessee shall be solely responsible for ascertaining that all proposed investments and
reinvestments are Qualified Investments and that they comply with federal, state and local laws,
regulations and ordinances governing investment of such funds and for providing appropriate
notice to the Acquisition Fund Custodian for the reinvestment of any maturing investment.
Accordingly, neither the Acquisition Fund Custodian nor Lessor shall be responsible for any
liability, cost, expense, loss or claim of any kind, directly or indirectly arising out of or related to
the investment or reinvestment of all or any portion of tbe moneys on deposit in the Acquisition
Fund, and Lessee agrees to and does hereby release tbe Acquisition Fund Custodian and Lessor
from any such liability, cost, expenscs, loss or claim, Interest on tbe Acquisition Fund shall
become part ortbe Acquisition Fund, and gains and losses on the investment of the moneys on
deposit in the Acquisition Fund shall be borne by tbe Acquisition Fund. For purposes of this
agreement, "Qualified Investments" means any investments which meet thc requirements of
[state law citationJ, IN THE ABSENCE OF WRITrEN INSTRUCTIONS, THE ACQUISITION FUND
CUSTODIAN IS HEREBY AUTHOIUZED AND DIRECTED TO INVEST AND RE-INVEST ALL FUNDS ON
HAND IN FDIC INSURED CEkTIFICAIES OF DFPOSITS (4) WEEKS MATURITY AND WITH AN
AUTOMATIC FOUR (4) WFEKS Ror L-OVER UNllL OTHERWISE DIRECTED,
#765408vl (BAPCCiAFA General)
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(c) Unless the Acquisition Fund is carlier terminated in accordance with the
provisions of paral,,'Taph (d) below, amounts in the Acquisition Fund shall bc disbursed by the
Acquisition Fund Custodian in payment of amounts described in Section 2 hereof upon receipt of
writtcn authorization(s) from Lessor, as is more fully described in Section 2 hereof. If the
amounts in the Acquisition Fund arc insufficient to pay such amounts, Lessee shall provide any
balance of the funds nceded to complete thc acquisition of the Equipment. Any moneys
remaining in the Acquisition Fund after May 10, 2011 (the "Acquisition Period") shall be
applied as provided in Section 4 hereof.
(d) Thc Acquisition Fund shall be ternlinated at the earliest of (i) th\Y final
distribution of amounts in thc Acquisition Fund or (ii) written notice given by Lessor of the
occurrence of a default or tenllination of the Lease due to non-appropriation.
(e) The Acquisition Fund Custodian may act in reliance upon any writing or
instrument or signature which it, in good faith, beheves to be genuine and may assume the
validity and accuracy of any statement or assertion contained in such a writing or instrument.
The Acquisition Fund Custodian shall not be liable in any manner for the sufficiency or
correctness as to form, manner of execution, or validity of any instrument nor as to the identity,
authority, or right of any person executing the same; and its duties hereunder shall be limited to
the receipt of such moneys, instruments or other documents received by it as the Acquisition
Fund Custodian, and for the disposition of the same in accordance herewith.
(f) Unless the Acquisition Fund Custodian is guilty of gross negligence or
willful misconduct with regard to its duties hereunder, Lessee agrees to and does hereby release
and indemnify the Acquisition Fund Custodian and hold it harmless from any and all claims,
liabilities, losses, actions, suits or proceedings at law or in equity, or any other expense, fees or
charges of any character or nature, which it may incur 9r with which it may be threatened by
reason of its acting as Acquisition Fund Custodian under this agreement; and in connection
therewith, does to the extent permitted by law indemnify the Acquisition Fund Custodian against
any and all expenses; including reasonable attorneys' fees and the cost of defending any action,
suit or proceeding or resisting any claim.
(g) If Lessee and Lessor shall be in disagreement about the interpretation of
the Lease, or about the rights and obligations, or the propriety of any action contemplated by thc
Acquisition Fund Custodian hereunder, the Acquisition Fund Custodian may, but shall not be
required to, file an appropriate civil action to resolve the disagreement. The Acquisition Fund
Custodian shall be reimbursed by Lessee for all costs, including reasonable attorneys' fees, in
connection with such civil action, and shall bc fully protected in suspending all or part of its
activities under thc Lease until a fInal judgment in such action is received,
(h) The Acquisition Fund Custodian may consult with counscl of its own
choice and shall have full and complete authorization and protection with the opinion of such
counsel. Tlle Acquisition Fund Custodian shall otherwise not be Iiablc for any mistakes of fact
or crrors of judgment, or for any acts or omissions of any kind unless caused by its willful
misconduct.
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(i) Lessee shall reimburse the Acquisition Fund Custodian for all reasonable
costs and expenscs, including those of the Acquisition Fund Custodian's a!lomeys, agents and
employees incurred for extra-ordinary administration of the Acquisition Fund and the
perfonnance of the Acquisition Fund Custodian's powers and duties hereunder in connection
with any Event of Default under the Lease, or in connection with any disputc between Lessor
and Lessee concerning the Acquisition Fund,
2, Acquisition of Property,
(a) Acquisition Contracts, Lessee will arrange for, supervise and provige for,
or cause to be supervised and provided for, the acquisition of the Equipment, with moneys
available in the Acquisition Fund. Lessee represents the estimated costs of the Equipment are
within the funds estimated to be available therefor, and Lessor makes no warranty or
representation with respect thereto. Lessor shall have no liability under any of the acquisition or
construction contracts. Lessee shall obtain all necessary permits and approvals, if any, for the
acquisition, equipping and installation of the Equipment, and the operation and maintenance
thereof.
(b) Authorized Acquisition Fund Disbursements, Disbursements from the
Acquisition Fund shall be made for the purpose of paying (including the reimbursement to
Lessee for advances from its own funds to accomplish the purposes hereinafter described) the
cost of acquiring the Equipment.
(c) Requisition Procedure, No disbursement from the Acquisition Fund shall
be made unless and until Lessor has approved such requisition, Prior to disbursement from the
Acquisition Fund there shall be filed with the Acquisition Fund Custodian a requisition for such
payment in the form of Disbursement Request attached hereto as Schedule I, stating each
amount to be paid and the name of the person, firm or corporation to whom payment thereof is
due, Each such requisition shall be signed by an authorized representative of Lessee (an
"Authorized Representative") and by Lessor, and shall be subject to the following:
I. Delivery to Lessor of a certi,ficate of Lessee to the effect that:
(i) an obligation in the stated amount has been incurred by Lessee, and that
the same is a proper charge against the Acquisition Fund for costs relating
to the Equipment identified in the Lease, and has not been paid; (ii) the
Authorized Representative has no notice of any vendor's, mechanic's or
other liens or rights to liens, chattel mortgages, conditional sales contracts
or security interest which should be satisfied or dischargcd before such
payment is madc;, (iii) such requisition contains no item representing
payment on account, or any retaincd pcrcentages which Lessee is, at thc
date of such certificate, entitled to retain; and (iv) the Equipment is
insured in accordance with the Lease,
2, Delivery to Lcssor of an Acceptance Certificate executed by Lessee,
together with any Purchase A!,,'fccment Assignment or bill of sale and
invoice therefor as required by Section 3,04 ofthe Lcase;
#765408vl (BAPCClAFA General)
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3, The disbursement shall occur during the Acquisition Period set forth in the
Schedule applicable to such Equipment;
4, There shall exist no Event of Default (nor any event which, with notice or
lapse of time or both, would become an Event of Default); and
5, No material adverse change in Lesscc's or any guarantor's financial
condition shall have occurred since the date of the Lease,
3, Deposit to Acquisition Fund, Upon satisfaction of the conditions specified III
Section 3,04 of the Lease, Lessor will cause the Lease Procceds to be deposited In the
Acquisition Fund, Lessee agrees to pay any costs with respect to the Equipment in excess of
amounts available therefor in the Acquisition Fund,
4, Excessive Acquisition Fund, Following the final disbursement from the
Acquisition Fund at the end of the Acquisition Period, or termination of the Acquisition Fund as
otherwise provided herein, the Acquisition Fund Custodian shall transfer any remaindeI from the
Acquisition Fund to Lessor for application to amounts owed under the Lease in accordance with
Section 4,07 of the Lease.
5, Securitv Interest. The Acquisition Fund Custodian and Lessee acknowledge and
agree that the Acquisition Fund and all proceeds thereof are being held by Acquisition Fund
Custodian for disbursement or return as set forth herein, Lessee hereby grants to Lessor a first
priority perfected security interest in the Acquisition Fund, and all proceeds thereof, and all
investments made with any amounts in the Acquisition Fund. If the Acquisition Fund, or any
part thereof; is converted to investments as set forth in this agreement, such .investments shall be
made in the name of Acquisition Fund Custodian and the Acquisition Fund Custodian hereby
agrees to hold such investments as bailee for Lessor so that Lessor is deemed to have possession
of such investments for the purpose of perfecting its security interest.
6. Control of Acquisition Account. In order to perfect Lessor's security interest by
means of control in (i) the Acquisition Fund established hereunder, (ii) all securities entitlements,
investment property and other financial assets now or hereafter credited to the Acquisition Fund,
(iii) all of Lessee's rights in respect of the Acquisition Fund, such securities entitlements,
investment property and other financial assets, and (iv) all products, proceeds and revenues of
and from any of the foregoing personal property (collectively, the "Collateral"), Lessor, Lessee
and Acquisition Fund Custodian further agree as follows:
(a) All tenns used in this Section 6 which are defined in the Commercial
Code of the state of California ("Commercial Code") but are not otherwise defined herein shall
have the meanings assigned to sucl) lenns in the Commercial Code, as in effect on the date of
this Agreement.
(b) Acquisition Fund Custodian will comply with all cntitlement orders
originated by Lessor with respect to the Collateral, or any portion of the Collateral, without
further consent by Lcssee,
#765408,,1 (BAPCC/AFA General)
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(c) Acquisition Fund Custodian hereby reprcsents and warrants (a) that the
records of Acquisition Fund Custodian show that Lessee is the sole owner of the Collateral,
(b) that Acquisition Fund Custodian has not been served with any notice oflevy or received any
notice of any security interest in or other claim to the Collatcral, or any portion of the Collateral,
other than Lessor's claim pursuant to this Agrecment, and (c) that Acquisition Fund Custodian is
not presently obligated to accept any entitlemcnt order trom any person with respect to the
Collateral, except for entitlement orders that Acquisition Fund Custodian is obligated to accept
from Lessor under this Agreement and entitlement orders that Acquisition Fund Custodian,
subject to the provisions of paragraph (e) below, is obligated to accept from Lessee,
(d) Without the prior written consent of Lessor, Acquisition Fund Custodian
will not enter into any agreement by which Acquisition Fund Custodian agrees to comply with
any entitlement order of any person other than Lessor or, subject to the provisions of
paragraph (e) below, Lessee, with respect to any portion or all of the Collateral. Acquisition
Fund Custodian shall promptly notify Lessor if any person requests Acquisition Fund Custodian
to enter into any such agreement or otherwise asserts or seeks to assert a lien, encumbrance or
adverse claim against any portion or all of the Collateral.
(e) Except as otherwise provided in this paragraph (e) and subject to
Section 1 (b) hereof, Acquisition Fund Custodian may allow Lessee to effect sales, trades,
tIansfers and exchanges of Collateral within the Acquisition Fund, but will not, without the prior
written consent of Lessor, allow Lessee to withdraw any Collateral from the Acquisition Fund.
Acquisition Fund Custodian acknowledges that Lessor reserves the right, by delivery of written
notice to Acquisition Fund Custodian, to prohibit Lessee from effecting any withdrawals
(including withdrawals of ordinary cash dividends and interest income), sales, trades, transfers or
exchanges of any Collateral held in the Acquisition Fund. Further, Acquisition Fund Custodian
hereby agrees to comply with any and all written instructions delivered by Lessor to Acquisition
Fund Custodian (once it has had a reasonable opportimity to comply theIewith) and has no
obligation to, and will not, investigate the reason for any action taken by Lessor, the amount of
any obligations of Lessee to Lessor, the validity of any of Lessor's claims against or agreements
with Lessee, the existence of any defaults under such agreements, or any other matter.
(f)
comply with all
Custodian.
Lessee
instructions
hereby irrevocably authorizes Acquisition Fund Custodian to
and entitlement orders delivered by Lessor to Acquisition Fund
(g) Acquisition Fund Custodian will not attempt to assert control, and does
not claim and will not accept any security or other interest in, any part of the Collateral, and
Acquisition Fund Custodian will not exercise, cnforce or attempt to enforce any right of setoff
against the Collateral, or otherwise charge or deduct from the Collateral any amount whatsoever.
,
(h) Acquisition Fund Custodian and Lessee hereby agree that any property
held in the Acquisition Fund shall be treated as a financial asset under such section of thc
Commercial Code as corresponds with Section 8-102 of the Unifonn Commercial Code,
notwithstanding any contrary provision of any other agrecment to which Acquisition Fund
Custodian may be a party
ff765408vl (BAPCCIAFA Gene"l)
5
2010-90
(i) Acquisition Fund Custodian is hereby authorized and instructed, and
hereby af,'fees, to send to Lessor at its address set forth in Section 7 below, concurrently with the
send1l1g thercof to Lessce, duplicate copics of any and all monthly Acquisition Fund statemcnts
or reports issued or sent to Lessee with respect to the Acquisition Fund,
7, Misccllancous, Capitalizcd tcrms not otherwise dcfined herein shall have the
meanings assigned to them in the Lease, This agreement may not be amended except in writing
signed by all parties hereto, 111is agrecment may be executed in one or more counterparts, each
of which shall be deemed to bc an original instrument and each shall have the force and effect of
an original and all of which together constitute, and shall be dcemed to constitute, one and the
same instrument. Notices hereunder shall be madc in writing and shall be deemed to have been
duly given when personally delivcred or when deposited in the mail, first class postage prepaid,
or delivered to an express carrier, charges prepaid, or sent by facsimile with electronic
confirmation, addressed to each party at its address below:
Ifto Lessor:
Bank of America, National Association
555 California Street, 4th Floor
Mail Code: CA5-705-04-01
San Francisco, CA 94104
Attn: Contract Administration
Fax: (415) 765-7373
If to Lessee:
City of San Bernardino
300 North D Street
San Bernardino, CA 92418
Attn: Mr. Michael Gomez
Fax: (909) 384-5043
If to Acquisition
Fund Custodian:
Deutsche Bank National Trust Company
101 California Street, 46th Floor
San Francisco, CA 94111
Attn: Raafat Albert Sarkis
Phone: (415) 617-2801
Fax: (415) 617-4270
:
#765408,,1 (BAPCCiAFA General)
6
2010-90
In Witness \Vhereof the parties have executed this Acquisition Fund and Account
Control Agreement as of the date first above written,
City of San Bernardino,
as Lessee
~b~/iL
/
Bank of AmerIca, NatIOnal Association,
as Lessor
By. ~~~C2,~
By
Title.
Assistant Vice President
TItle: Director of Finance
.
Deutsche Bank National Trust Company
As Acquisition Fund Custodian
By:
Title:
By:
Title:
:
n65-11l~hl rn-\I'CC':\F\ (;l;~l1cr;lll
7
2010-90
In Witness Whereof, the parties have executed this Acquisition Fund and Account
Control Agreement as of the date first above written,
Bank of America, National Association,
as Lessor
City of San Bcmardino,
as Lessee
By:
By:
Title:
'T':..1_.
llUC::.
.
By:
Title:
By:
onia N. Flores
ViCR President
Title:
#765408vl (BAPCCI AF A General)
7
2010-90
CERTIFICATE
The undersigned, a duk elected and acting City Clerk
_~e Cl~~ ~fsan Bernar lnf"Lessee") certifies as follows:
Secretary of
A The following listed persons arc duly elected and acting ofticials of Lessee (the
"Officials ") in the capacity set forth opposite their respcctive names below and that thc facsimile
signatures are true and correct as of the date hereof;
B, The Officials are duly authorized, on behalf of Lessee, to negotiate, execute and deliver the
Master Equipment Lease/Purchase Agreement No, 2114500-06000, dated as of May 10, 20 I 0, and the
Schedule(s) thereunder and all future Schedule(s) (the "Agreements ") by and between Lesse; and Bank
of America, National Association and these Agreements are binding and authorized Agreements of
Lessee, enforceable in all respccts in accordance with their tcrms,
Michael Gomez
Financial Analyst
:;~": ~L
~
~
Name of Official
Title
Barbara Pachon
Director of Finance
Kate Myers
Accounting Manager
Dated May 6. 2010
By (2,~k. ~
'>-
Title City Clerk
(The signer of this Certificate cannot be listed above as authorized to execute the Agreements.)
"
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'9,
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W
ill
if>
2010-90
W~9
Request for Taxpayer
Identification Number and Certification
Give form to the
requestef. Do not
send to the IRS.
Form
(Rev. October 2007)
Department ollhe TrEasury
InI6"'<:I1 Revenue Service
tJame (as sho\'.n on your income tax return)
CITY OF SAN BERfoI!'RJ)~N~____
Bus;ne~s n2:T1e, il dlfferentlrom abo\,'1::
Check appropriate box 0 IndiVidual/Soil.' pruprtelor 0 Co'pU;:'l,on
o Limited liaLJiI,ty company. En(er the tax clas~lticat>(.rl (D~dlslegaraed enl.:)
ex Other (see im,trucl,on,) .. GOVERNMENT
Address (number, street, and apl. or su;le no)
30~~D.
Cit)', state, and ZIP code
ST.
o Partnership
(: corporallcn, F=par1nerslllp) J'
Enter your TIN in the appropriate box The TIN provided must match the name given on Line 1 \0 avoid
backup withholding. For individuals, this is your social security number (SSN) However, for a resident
alien, sole proprietor, or disregarded entity, see the Part I insfructions on page 3. For other entities, il is
your employer identification number (EIN). If you do not have a number, see How to gel a TIN on page 3.
Note. If the account is in more than one name, see Ihe char1 on page <1 for guidelines on whose
number to enter.
SAN BERNARDINO
List account nUnlbel\s) here (optional)
CALI FORNIA
~ hemp!
payee
U----TRcq,,-"ec, 00'" "'d odd"" [opl,ooo'[
,924~8_ ~
- ~--
BANK OF AMER}CA
[ Socio' "co:,ty nom~"
or
Employer identification number
95-: 6000772
Under penalties of perjury, I cer1ify that
1 The number shown on this form is my c.onecl taxpayer identifiC<ltion number (or I am waiting for a number to be issued 10 me), and
2 r ain not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been nolilied by the Internal
Revenue Service (IRS) that I am SUbject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has
notified me that I am no longer subject to backup withholding, and
3. I am a U.S. citizen or other U.S. person (defined below)
Certification Instructions. You must cross out item 2 above If you have been notified by the IRS that you are currently subject to backup
withholding because you have failed to repor1 all interest and dividends on your tax return. For real estate transactions, item 2 does not apply.
For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement
arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the Certification, but you must
provide your correct TIN. See the instructions on page 4
Sign
Here
Taxpayer Identi!,icalion Number (TIN) __
Certification
Signature 01
U.S. person ~
General Instructions
Section references are to the Internal Revenue Code unless
otherwise noted.
Purpose of Form
A person who is required to file an information return with the
IRS must obtain your correct taxpayer identification number (TiN)
to report, for example, income paid to you, real estate
transactions, mortgage interest you paid, acquisition or
abandonment of secured property, cancellation of debt, 0>
contributions you made to an IRA
Use Form W-g only if you are a U.S. person (including a
resident alien), to provide your correct TIN to the person
requesting it (the requester) and, when applicable, 10
1. Certify that the TIN you are giving is correct (or you arE
waiting for a number to be issued),
2. Cer1ify that you are not subject to backup v~lthholdlng, or
3 Claim exemption hom backup withholding if you are a US
exempt payee. If applicable, you are also certitying that as 3
U.S. person, your allocable share of any partnership income from
a U.S. trade or business is not subject to the withholding tax on
foreign partners' share of effectively connected income
Note. If a requester gives you a form other than Form \\1-9 to
request your TIN, you must use the requester's lorrn il 1\ rs
subslanti2.!I)-' Similar to this Form \^j-g
Date ..
Y 6
2010
Definition of a U.S. person. For federal tax purposes, you are
considered a U.S. person if you are:
4: An individual who is a U.S. citizen or U.S. resident alien,
.. A partnership, corporation, company, or. association created or
organized in the United States or under the laws of the United
States,
" An estate (other than a foreign estate), or
f A domestic trust (as defined in Regulations section
3017701-7)
Special rules for partnerships, Partnerships that conduct a
trade or business in the United States are generally required to
pa\-' a \Nithholding tax on any foreign partners' share of income
from such business Further, in cert2in cases where a Form \\1-9
has not been received. a partnership is required to presume that
a partner is a foreign person, and pay the withholding tax
Therefore. ij you are a U.S person that is a partner' in a
partn€tship conducting a trade or business in the United States,
provide Form \1'-,1-9 to the partnership to eslablish your U.S
status and 3':oid withholding on your share of partnership
Income
The person who gives Form W.9 to the partnership for
purposes of establishing its U S status and avoidino withholci.10
on its allocable share of net Hlcome tram the partnership -
conducting a trade or business in the United States IS in thl':
fc:dlo\'ilrH] cases
t Th::: U S C'.., nH c! J (j:sregcrced '2rll:t:, end flot \tIe tniit~"
c<;~ Ih lL'231X
FDrm W-9 IR",. lQ-~'C('-