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HomeMy WebLinkAbout2011-055 (IMPORTANT NOTE: COMPANION RESOLUTION 2011-56) RESOLUTION NO. 2011-55 1 RESOLUTION AUTHORIZING THE EXECUTION OF AN AGREEMENT AND ISSUANCE OF A PURCHASE ORDER TO CREST CHEVROLET OF SAN 2 BERNARDINO PURSUANT TO SECTION 3.04.010-B3 OF THE MUNICIPAL CODE, FOR ONE (1) 2010 SCHWARZE M6000 BROOM SWEEPER POWERED BY 3 COMPRESSED NATURAL GAS TO BE UTILIZED BY THE PUBLIC SERVICES 4 DEPARTMENT STREET DIVISION; AND AWARD A LEASE-PURCHASE AGREEMENT TO PINNACLE PUBLIC FINANCE. 5 BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE 6 CITY OF SAN BERNARDINO AS FOLLOWS: 7 SECTION 1. That the City Manager of the City of San Bernardino is hereby authorized 8 to execute on behalf of said City an Agreement between the City of San Bernardino and Crest 9 Chevrolet, a copy of which is attached hereto, marked Exhibit "A" and incorporated herein by 10 reference as fully as though set forth at length. 11 12 13 14 15 16 17 SECTION 2. That this purchase is exempt from the formal contract procedures of Section 3.04.010 of the Municipal Code, pursuant to Section 3.04.010-B3 of said Code "Purchases approved by the Mayor and Common Council". SECTION 3. That Crest Chevrolet has olTered a negotiated purchase pnce of $320,589.07 including tax pursuant to Section 3.04.010-B3 of the Municipal Code for one (I) Year 2010 Schwarze M6000 Broom Sweeper powered by Compressed Natural Gas (CNG). 18 Pursuant to this determination the Director of Finance or her designee is hereby authorized to 19 20 issue a Purchase order to Crest Chevrolet of San Bernardino, in the amount of $320,589.07, 21 which will facilitate the procurement of the vehicle; and award a bid for lease purchase 22 23 24 25 26 27 III financing to Pinnacle Public Finance. SECTION 4. That the Purchase Order shall reference this Resolution Number and shall read, "One 2010 CNG powered Schwarze M6000 Broom Sweeper." P.O. not to exceed $320,589.07 and shall incorporate the terms and conditions of the Agreement. 28 2011-55 RESOLUTION AUTHORIZING THE EXECUTION OF AN AGREEMENT AND ISSUANCE OF A PURCHASE ORDER TO CREST CHEVROLET OF SAN 1 BERNARDINO PURSUANT TO SECTION 3.04.010-B3 OF THE MUNICIPAL CODE, FOR ONE (1) 2010 SCHWARZE M6000 BROOM SWEEPER POWERED BY 2 COMPRESSED NATURAL GAS TO BE UTILIZED BY THE PUBLIC SERVICES DEPARTMENT STREET DIVISION; AND AWARD A LEASE-PURCHASE 3 AGREEMENT TO PINNACLE PUBLIC FINANCE. 4 SECTION 5. That Pinnacle Public Finance provided the lowest rate quote for the lease- 5 6 purchase of a one (I) Schwarze M6000 Broom Sweeper powered by Compressed Natural Gas (CNG), marked Exhibit "B". Pursuant to this determination the Director of Finance is hereby 7 8 authorized to execute lease-purchase documents with Pinnacle Public Finance. 9 SECTION 6. The authorization to execute the above referenced Purchase 10 Order and Agreement is rescinded ifit is not issued within sixty (60) days of the 11 passage of this Resolution. 2011-55 RESOLUTION AUTHORIZING THE EXECUTION OF AN AGREEMENT AND ISSUANCE OF A PURCHASE ORDER TO CREST CHEVROLET OF SAN 1 BERNARDINO PURSUANT TO SECTION 3.04.010-B3 OF THE MUNICIPAL CODE, FOR ONE (1) 2010 SCHWARZE M6000 BROOM SWEEPER POWERED BY 2 COMPRESSED NATURAL GAS TO BE UTILIZED BY THE PUBLIC SERVICES DEPARTMENT STREET DIVISION; AND AWARD A LEASE-PURCHASE 3 AGREEMENT TO PINNACLE PUBLIC FINANACE. 4 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor 5 joint and Common Council of the City of San Bernardino at a regular meeting thereof, held 6 7 Council Members: 8 9 on the 7th day of March , 20 II, by the following vote, to wit: AYES NAYS ABSTAIN ABSENT MARQUEZ x 10 VACANT 11 BRINKER 12 13 x SHORETT -----X- x KELLEY 14 JOHNSON x 15 16 MCCAMMACK 17 18 19 20 x RacheLG. Clark, City Clerk . ,j?~:J<.<.~'iA)~.r The foregoing resolution is hereby approved this 97711 day of _ March ~ 2011. 21 22 23 24 25 26 27 28 03tc. /? ~ Tobin Brinker, Mayor Pro Tern City of San Bernardino 2011-55 VENDOR SERVICE AGREEMENT This Vendor Service Agreement is entered into this 7th day of March 2011, by and . NOW, THEREFORE, the parties hereto agree as follows: SCOPE OF SERVICES. For the remuneration stipulated, San Bernardino hereby engages the serVIces of VENDOR to provide those products and services as set forth in its quote, a copy of which is attached hereto as Attachment "2" and incorporated by this reference. 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 $320,589.07, for the purchase of one (1) 2010 Schwarze M6000 (CNG) powered Broom Sweeper. b. No other expenditures made by VENDOR shall be reimbursed by CITY. 3. TERM; TERMINATION. The term of this agreement shall be for one year. Exhibit "A" I 2011-55 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 Vendor expressly warrants that all products and services supplied to City by Vendor purposes of this section shall not be deemed to require more than 60 calendars days notice before commencement of efforts by the City to effect cover or a cure except upon written agreement of the Parties. 5. 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 Exhibit "A" 2 2011-55 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 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. NON-D1SCRIMINA nON. 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, Exhibit "A" 3 2011-55 I ancestry, age, mental or physical disability, medical conditions, marital status, sexual gender or 1 sexual orientation, or any other status protected by law. 2 3 8. INDEPENDENT CONTRACTOR. VENDOR shall perform work tasks provided by this Agreement, but for all intents and 4 5 purposes VENDOR shall be an independent contractor and not an agent or employee of the 6 7 8 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 9 10 employees, and all business licenses, if any are required, in connection with the services to be performed hereunder. 11 12 9. 13 14 15 16 17 18 19 BUSINESS REGISTRATION CERTIFICATE AND OTHER REQUIREMENTS. 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 licenses, permits, qualifications, insurance and approval of whatever nature that are legally required of VENDOR to practice its business or profession. NOTICES. Any notices to be given pursuant to this Agreement shall be deposited with the United 20 States Postal Service, postage prepaid and addressed as follows: 21 TO THE CITY: Public Services Director 300 North "D" Street San Bernardino, CA 92418 Telephone: (909) 384-5140 22 23 24 25 26 27 28 TO THE VENDOR: Crest Chevrolet 909 West 21st Street San Bernardino, CA 92402-0501 Telephone: (909) 883-8833 Attn: Dan Zank Exhibit "A" 4 2011-55 10. ATTORNEYS' FEES. In the event that litigation is brought by any party in connection with this Agreement, the prevailing party shall be entitled to recover from the opposing party all costs and expenses, 11. ASSIGNMENT. 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 ofthis Agreement. VENUE. The parties hereto agree that all actions or proceedings arising in connection with this 13. GOVERNING LAW. This Agreement shall be governed by the laws of the State of California. Exhibit "A" 5 2011-55 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. SEVERABILITY. If any provision of this Agreement is determined by a court of competent jurisdiction to 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. 3 date set forth below. 4 5 Dated: ,2011 6 7 8 9 Dated ,2011 1 2 10 2011-55 VENDOR SERVICE AGREEMENT CREST CHEVROLET IN WITNESS THEREOF, the parties hereto have executed this Agreement on the day and Crest Chevrolet By: CITY OF SAN BERNARDINO By: Charles E. McNeely, City Manager 11 Approved as to Form: 12 13 By: James F. Penman, City Attorney 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Exhibit "A" 7 2011-55 ~~\.a tI, DO iT~ ttTODA!I!lt ..\~~ - I G.!!!!!S-T ........... .......... . . . . . ~'VL Phone (909) 883-8833 FAX (909) 886-4418 . . . . . . . ...................... www.crestchevy.com 909 W. 21st st. . P.O. Box 501 San Bernardino. CA 92402-0501 FEBUARY 9,2011 DON JOHNSON CITY OF SAN BERNARDINO 182 S SIERRA WAY SAN BERNARDINO SUBJECT: SCHWARZE M-6000CNG AS PER OUR CONVERSATION CREST CHEVROLET WILL HANDLE THE DMV PAPERWORK ON THE SCHWARZE M-6000 CNG FOR $250.00. THIS IS A LIST OF THE CHARGES FROM KELLY THE FEE FOR THE DMV PAPERWORK, AND THE CALIFORNIA STATE TIRE FEE FOR EACH UNIT. BASE PRICE SALES TAX SUB TOTAL TIRE FEE CREST CHARGE FOR DMV PAPERWORK 293,873.00 26,448.57 326,321.57 17.50 250.00 320,589.07 PLEASE CALL ME IF YOU HAVE ANY QUESTIONS. ~. THANK YOU,. '. ) " <;:~--- DANNY~NK FLEET MANAGER -j Factory Authorized ~ Sales and Service ~ .~UIPment Attachment "2" SALES SERVICE ~Wtt-55 RENTALS 1884 WOODLAWN STREET, UPLAND. CA 91788 TEL. 909.920.4557 FAX. 909.920.4558 TF. 800.288.7933 WWW.KELLYEQUIPMENT.COMSUPPORT@KELLYEQUIPMENT.COM PROPOSAL Contact: leon Schrader Company: City of San Bernardino Address: 300 N. 0 Street City, Slate Zip: San Bernardino CA Telephone: Fax: E~aU Address: 92418 Proposel Date: 7-Feb-2011 Created By: S. McElvy Manufacturer: Schwarze Unit Model: M-6000CNG ChasslsITractor: StefUng Actera FOB Point: Upland. CA Special Instructions: Model: New Schwarze M.eOOOCNG Single Engine Do&Ign Conveyor Typo Ekwator \\tIh Chain and Sprocket Drtve Squeegee 58-lnoh MaIn Broom Pneumatic Main Broom PaUam Control, In Cab Adju.tment 3-Way POCWY8 Elevator Adju81ment Elevator Jam A1all11 and Indicator 35-Gallon Hydraulic Reservoir Dual Gutter Broom Rood Lights Rear Mounted Main Broom Rood Lights Resr Mounted Strobe B_COR with GuerU Cab Mounted Strobe Beeoon wtIh Guerd Standard 12-Month Wananty Paint Standard WhlCe Tenns: COD or Finance Status: New Order DeU""ry: 80-120 Days ARO Stock #: Order Expires: 3O-Days ~Clflcations . Yard High Dump Hopp8f Dump Helghl16-lnches to 138-.tnches Variable 14.000 Ibo. Hoppe, LIt Capaoily Dual ~nch GuUaf Brooms Dual Gutter Broom nit. Hydraulic, In Cab Control Pneumatic Gunar Broom DoMl Pr888Ure Control 300-GaDon Water Storage Tank Front Mounted Spray Bar Main Broom Spray Ber Gutter Broom Spray Bar(s) Water Level Gauge In Cab 12-VotJ Electric Water Pump AQIIO Rule 1186 and 1186.1 Certified (PM-1D Certified) Tractor Specifications Cummine 8.9 LJer CNG Engine AIieon ROS-3500 5-Speed Automatic Trsnsmlsaion 33.000 Ibs., GVWR ChassIs Air Conditioned Cab AMJFMfCO Stereo 2.speed Rar AIle Chalmers Rear Suspension System Paint Standard White 24-Monttl Towing Warranly, Sterling Chassis Alto Lube System Optional EquIpment AvaUable Included with Proposal Model: 2009 Slerllna Actera Conventional Chassis 133-lnch Wheel Ba90 Conventional Ch886iB Dual Steertng and Controls Dual Air Ride Seats Cruise Control Air Brakos Grey Vinyt Interior S1andard 2-Year Unliniled MtIe Chassis Warranty Standard 3-yee,rTransmis&ion Warranty Warranty: AllIson Transmission, s..Vears Wan;ahly: Cummins Engine, 5-Yea.rs, 300,000 Miles On Sile S8fV1oe and Operator Training On SUe Warranty Repair Sweeper No Charge No Ctlarge Safety Camera System. Right and Rear Cameras Se"" Unit Pricinq: .ft , ~.. Unit Price: Other: San Bernardino Pricing Structure R3435 Other: Camera System Option Unit Total: freight, Delivery and PDI Documentation Fee: State Tlre Tax, Per l1re Caflfomia State Sales Tax: Total PrIce FOB Destination 18.:6,,1 $ 294,913.00 $ (8.99(l.OO) $ 2,450.00 $ 288,373.00 $ 5,500.00 $ $ $ $ 10.50 25,232.64 319,118.104. @ Rate $1.75 F'n~,"clna ProDOSill lease or Loan: Length of Term: Proposed lender: Order Tenns and Conditions Amount 10 Finance: $. Lease Residual: $ Inlerelil Rate: Down Payment $ Doc Fee $ Monthly Payment: $ PluaTlVl: Price valid for 3D days unless othlJl'Wise stated above. Terms are COD or proper execlJl:ion oflinanclng arrangement. In stock units are 5Ubjectto prior 681&. Delivery terms are best estimates and subject to delaY5 beyond our control. Fl1snclng tel'Tl'l5 pravlded for budgetary purposes only and are suqect to credit approval. New equipment is offered with all s1andard tactorywarrantle&. Addiional warranties may be available blot are not part of this propoul unlns otheMSSltated. MUlti unit orsp&Cific unit discounts may require purchase of one or more uni!5. A 15% non-refundable security deposit is required far all special orderequipm.nt. Kelly Equipment Signature Nome Title customer SIgnature Name Title ;,1. ... Pinnacle Public Finance A BanKU:1ited Company 2011-55 MASTER EQUIPMENT LEASE PURCHASE AGREEMENT This Master Equipment Lease Purchase Agreement dated as of March 11, 20 II and entered into between Pinnacle Public Finance, Inc" a Delaware corporation ("Lessor"), and City of San Bernardino, a body corporate and politic existing under the laws of tbe State of California ("Lessee"), 1. Allreement. Lessee agrees to lease from Lessor certain "Equipment" as described in each Equipment Schedule (Exhibit A), which together with a Rental Payment Schedule (Exhibit A- I) constitute a "Schedule", subject to the terms and conditions of and for the purposes set fOlth in each Lease, 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, Each Schedule and the terms and provisions of this Agreement (which includes all exhibits hereto, together with any amendments and modifications pursuant thereto) which are incorporated by reference into such Schedule shall constitute a separate and independent lease and installment purchase of the Equipment therein described and are referred to herein as a "Lease". 2. Term. The "Commencement Date" for each Lease is the date when interest commences to accrue 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 11, or (ii) the date on which sufficient monies to purchase the Equipment listed in such Lease are deposited for that purpose with an escrow agent, or (iii) the date sufficient monies are set aside for acquisition of Equipment as evidenced in Exhibit D, if applicable, The "Lease Term" for each Lease means the Original Term and all Renewal Terms therein provided and for this Agreement means the period from the date hereof until this Agreement is terminated, The "Original Term" means the period from the Commencement Date for each Lease until the end of Lessee's fiscal year or biennium (as the case may be) (the "Fiscal Period") in effect at such Commencement Date, The "Renewal Term" for each Lease is each term having a duration that is coextensive with the Fiscal Period, , 3. Representations and Covenants of Lessee. Lessee represents, covenants and warrants for the benefit of Lessor on the date hereof and as of the Commencement Date of each Lease as follows: (a) Lessee is a public body corporate and politic duly organized and existing under the constitution and laws of the State with full power and authority under the constitution and laws of the state where the Lessee is located ("State") 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 and held in accordance with State law, or by other appropriate official approval, and all requirements have been met and procedures have occurred to ensure the validity and enforceability of this Agreement and each Lease~ (c) 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: (d) Lessee has complied with such public bidding requirements as may be applicable to this Agreement and each Lease and the acquisition by Lessee of the Equipment as provided in each Lease; (e) during the Lease Term, the Equipment will be used by Lessee solely and exclusively for the purpose of performing essential governmental or proprietary functions of Lessee consistent with the permissible scope of Lessee's authority; (f) Lessee will annually provide Lessor with current financial statements, budgets, proof of appropriation for the ensuing Fiscal Period, and such other financial information relating to the ability of Lessee to continue each Lease as may be requested by Lessor; and (g) 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, 4, Tax and Arbitra2e Reoresentations, Lessee hereby represents as follows: (a) the estimated total costs of the Equipment listed in each Schedule will not be less than the total principal portion of the Rental Payments listed in such Rental Payment Schedule; (b) the Equipment listed in each Schedule has been ordered or is expected to be ordered within 6 months of the Commencement Date, and all amounts deposited in escrow to pay for the Equipment, and interest earnings, will be expended on costs of the Equipment and the financing within 3 years of Commencement Date; (c) no proceeds of any Lease will be used to reimburse Lessee for expenditures made more than 60 days prior to the Commencement Date or, if earlier, more than 60 days prior to any official action taken to evidence an intent to finance; (d) Lessee has not created or established, and does not expect to create or establish, any sinking fund or similar fund (I) that is reasonably expected to be used to pay the Rental Payments, or (ii) that may be used solely to prevent a default in the payment of the Rental Payments; (e) the Equipment listed in each Schedule has not been and is not expected to be sold or otherwise disposed of by Lessee, either in whole or in part, prior to the last maturity of Rental Payments: (f) Lessee will comply with all applicable provisions of the Internal Revenue Code of 1986, as amended ("Code"), including without limitation Sections 103 and 148 thereof, and the applicable regulations of the Treasury Department to maintain the exclusion of the interest components of Rental Payments from gross income for purposes of federal income taxation; and (g) Lessee intends that each Lease not constitute a "true" lease for federal income tax purposes. 5. Lease of Eauioment. Upon the execution of each Lease, Lessor demises, leases, transfers, and Jets to Lessee, and Lessee acquires, rents, leases and hires from Lessor, the Equipment 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 an)' Renewal Term for the next succeeding Renev,'al Term up to the maximum Lease Tenn"set forth in such Lease. At the end of the Original Teflll and at the end of each Renewal Term the Lease Tem EXH/lifT ;'5" shall be automatically extended upon the successive appropriation by Lessee's governing body of amounts sufficient to pay Rental Payments and other amounts payable under the related Lease during the next succeeding Fiscal Period until all Rental Payments payable under such Lease have been paid in full, unless Lessee shall have terminated such Lease pursuant to Section 7 or Section 22. The terms and conditions during any Renewal Term shall be the same as the terms and conditions during the Original Term, except that the Rental Payments shall be as provided in the applicable Lease. 6. Continuation of Lease Term. Lessee currently intends, subject to Section 7, to continue the Lease Term of each Lease through the Original Term and all Renewal Terms and to pay the Rental Payments thereunder. Lessee reasonably believes that legally available funds in an amount sufficient to make all Rental Payments during the maximum Lease Term of each Lease can be obtained. Lessee currently intends to do all things lawfully within its power to obtain and maintain funds from which the Rental Payments may be made, including making provision for such payments to the extent necessary in each budget or appropriation request submitted and adopted in accordance with applicable provisions afIaw. Notwithstanding the foregoing, the decision whether or not to budget and appropriate funds or to extend the applicable Schedule for any Renewal Tenn is within the discretion of the governing body of Lessee. 7. Nonappropriation. Lessee is obligated only to pay such Rental Payments under each Lease as may lawfully be made from funds budgeted and appropriated for that purpose. Should Lessee fail to budget, appropriate or otherwise make available funds to pay Rental Payments under any Lease following the then current Original Term or Renewal Term, such Lease or Leases shall be deemed terminated at the end of the then current Original Term or Renewal Tern1. Lessee agrees to deliver notice to Lessor of such termination at least 30 days prior to the end of the then current Original Term or Renewal Term, but failure to give such notice shall not extend the term beyond such Original Term or Renewal Term. If any Lease is terminated in accordance with this Section, Lessee agrees to peaceably deliver the Equipment to Lessor at the location(s) to be specified by Lessor. 8. Conditions to Lessor's Performance. This Agreement is not a commitment by Lessor to enter into any Lease not currently in existence, and nothing in this Agreement shall be 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. Lessee will cooperate with Lessor in Lessor's review of any proposed Lease. Lessee understands that Lessor requires certain documentation and information necessary to enter into any Lease and Lessee agrees to 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 concerning the Equipment and its contemplated use and location and documentation or information concerning the financial status of Lessee and other matters related to Lessee. 2011-55 9. Rental Pavments. Lessee shall promptly pay "Rental Payments" as described in Exhibit A-I to each Lease, exclusively from legally available funds, to Lessor on the dates and in such amounts as provided in each Lease. Lessee shall pay Lessor a charge on any Rental Payment not paid on the date such payment is due at the rate of 12% per annum or the maximum rate permitted by law, whichever is less, from such date until paid. Rental Payments consist of principal and interest portions. Lessor and Lessee understand and intend that the obligation of Lessee to pay Rental Payments under each Lease shall constitute a current expense of Lessee and shall not in an~y way be construed to he a deht 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 monies of Lessee. 1 O. RENTAL PAYMENTS TO BE UNCONDITIONAL. EXCEPT AS PROVIDED IN SECTION 7, 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 LIMIT A nON ANY FAILURE OF THE EQUIPMENT TO BE DELIVERED OR INSTALLED. ANY DEFECTS, MALFUNCTIONS, BREAKDOWNS OR INFIRMITlES IN THE EQUIPMENT OR ANY ACCIDENT, CONDEMNATION OR UNFORESEEN CIRCUMSTANCES 11. Deliver\': Installation: Acceotance. Lessee shall order the Equipment, cause the Equipment to be delivered and installed at the location specified in each Lease and pay any and all delivery and installation costs in connection therewith. When the Equipment listed in any Lease has been delivered and installed, Lessee shall immediately accept such Equipment and evidence said acceptance by executing and delivering to Lessor an Acceptance Certificate (Exhibit B). Lessor shall provide Lessee with quiet use and enjoyment of the Equipment during the Lease Term. 12. Location: Inspection. Once installed, no item of the Equipment will be moved from the 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. 13. Use: Maintenance. Lessee will not install, use, operate or maintain the Equipment improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by the related Lease. Lessee shall provide all permits and licenses, if any, necessary for the installation and operation of the Equipment. In addition, Lessee agrees to comply in all respects with all applicable laws, regulations and rulings of any legislative, executive, administrative or judicial body. Lessee agrees that it will, at Lessee's own cost and expense. maintain, preserve and keep the Equipment in good repair and working order. Lessee will enter into a maintenance contract for the Equipment that is acceptable to Lessor. 14. Title. Upon acceptance of the Equipment under a Lease by Lessee, title to the Equipment shall vest in Lessee subject to Lessor's rights under the Lease; provided that title shall thereafter immediately and without any action by Lessee vest in Lessor, and Lessee shall immediately surrender possession of the Equipment to Lessor, upon (a) any tennination of the applicable Lease other than termination pursuant to Section 22 or (b) the occurrence of an Event of Default. Transfer of title to Lessor pursuant to this Section shall occur automatically without the necessity of any bill of sale, certificate of title or other instrument of conveyance. Lessee shall. nevertheless, execute and deliver any such instruments as Lessor may request to evidence such transfer. 15. Securitv Interest. To secure the payment of all of Lessee's obligations under each Lease, upon the execution of such Lease, Lessee grants to Lessor a security interest constituting a first and exclusive lien on the Equipment applicable to such Lease and on all proceeds therefrom. Lessee agrees to execute such additional documents, in form satisfactory to Lessor, which Lessor deems necessary or appropriate to establish and maintain its security interest in the Equipment. The Equipment is and will remain personal property and will not be deemed to be affixed to or a part of the real estate on which it may be situated. 16. Liens, Taxes. Other Governmental Char2es and Utilitv Char2es. Lessee shall keep the Equipment free of all levies, liens and encumbrances except those created by each Lease. The parties to this Agreement contemplate that the Equipment will be used for governmental or proprietary purposes of Lessee 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. 17. Insurance. At its own expense, Lessee shall during each Lease Term maintain (a) casualty insurance insuring the Equipment against loss or damage by fire and all other risks covered by the standard extended coverage endorsement then in use in the State and any other risks reasonably required by Lessor, in an amount at least equal to the then applicable "Purchase Price" of the Equipment as described in Exhibit A-I of each Lease; (b) liability insurance that protects Lessee from liability in all events in form and amount satisfactory to Lessor; and (c) workers' compensation coverage as required by the laws of the State; provided that, with Lessorls prior written consent, Lessee may self~insure against the risks described in clauses (a) and (b). Lessee shall furnish to Lessor evidence of such insurance or self-insurance coverage throughout each Lease Term. Lessee shall not materially modify or cancel such insurance or self-insurance coverage without first giving written notice thereof to Lessor at least 10 days in advance of such cancellation or modification. All such insurance described in 2011-55 clauses (a) and (b) above shall contain a provision naming Lessor as a loss payee and additional insured. 18. Advances. In the event Lessee shall fail to keep the Equipment in good repair and working order, Lessor may, but shall be under no obligation to, maintain and repair the Equipment and pay the cost thereof. All amounts so advanced by Lessor shall constitute additional rent for the then current Original Term or Renewal Term and Lessee agrees to pay such amounts so advanced by Lessor with interest thereon from the advance date until paid at the rate of 12% per annum or the maximum rate permitted by law, whichever is less. 19. Dama2e. Destruction and Condemnation. If (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, finn or corporation acting pursuant to governmental authority, Lessee and Lessor will cause the Net Proceeds to be applied to the prompt replacement, repair, restoration, modification or improvement of the Equipment to substantially the same condition as existed prior to the event causing such damage, destruction, or condemnation, unless Lessee shall have exercised its option to purchase the Equipment pursuant to Section 22. Any balance of the Net Proceeds remaining after such work has been completed shall be paid to Lessee. For purposes of this Section, the tenn "Net Proceeds" shall mean (y) the amount of insurance proceeds received by Lessee for replacing, repairing, restoring, modifying, or improving damaged or destroyed Equipment, or (z) the amount remaining from the gross proceeds of any condemnation award or sale under threat of condemnation after deducting all expenses, including attorneys' fees, incurred in the collection thereof. If the Net Proceeds are insufficient to pay in full the cost of any replacement, repair, restoration, modification or improvement referred to herein, Lessee shall eitber (a) complete such replacement, repair, restoration, modification or improvement and pay any costs thereof in excess of the amount of the Net Proceeds, or (b) pursuant to Section 22 purchase Lessor's interest in the Equipment and in any other Equipment listed in the same Lease. The amount of the Net Proceeds, if any, remaining after completing such replacement, repair, restoration, modification or improvement or after purchasing Lessor's interest in the Equipment and such other Equipment shall be retained by Lessee. If Lessee shall make any payments pursuant to this Section, Lessee shall not be entitled to any reimbursement therefor from Lessor nor shall Lessee be entitled to any diminution of the amounts payable under Section 9. 20. 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 WARRANTY WITH RESPECT THERETO WHETHER EXPRESS OR IMPLIED. AND LESSEE ACCEPTS SUCH EQUIPMENT AS IS AND WITH ALL FAULTS. IN NO EVENT SHALL LESSOR BE LIABLE FOR ANY INCIDENTAL. INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE IN CONNECTION WITH OR ARISING OUT OF ANY LEASE OR THE EXISTENCE, FURNISHING, FUNCTIONING OR LESSEE'S USE OF ANY ITEM, PRODUCT OR SERVICE PROVIDED FOR IN ANY LEASE. 21. Vendor's Warranties. Lessor hereby irrevocably appoints Lessee as 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 from time to time whatever claims and rights (including without limitation warranties) relating to the Equipment that Lessor may have against Vendor. The term "Vendor" means any supplier or manufacturer of the Equipment as well as the agents or dealers of the manufacturer or supplier from whom Lessor purchased or is purchasing such Equipment. Lessee's sole remedy for the breach of such warranty, indemnification or representation shall be against Vendor of the Equipment, and not against Lessor. Any such matter shaJl not have any effect whatsoever on the rights or 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 Vendor of the Equipment. 22. Purchase Option. Lessee shall have the option to purchase Lessor's interest in all of the Equipment listed in any Lease, upon giving written notice to Lessor at least 60 days before the date of purchase, at the folIowing times and upon the following terms: (a) on the Rental Payment dates specified in each Lease, upon payment in fuII of the Rental Payments then due under such Lease plus the then applicable Purchase Price as referenced in Exhibit A-I; 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 Lessor of its exercise of the purchase option upon payment in fuII to Lessor of the Rental Payments then due under such Lease plus the then applicable Purchase Price plus accrued interest from the immediately preceding Rental Payment date to such purchase date. 23. Asshmment. Lessor's right, title and interest in and to each Lease, including Rental Payments and any other amounts payable by Lessee thereunder and aII proceeds therefrom, may be assigned and reassigned to one or more assignees or subassignees by Lessor without the necessity of obtaining the consent of Lessee; provided that any such assignment shall not be effective until (a) Lessee has received written notice, signed by the assignor, of the name and address of the assignee, and (b) it is registered on the registration books. Lessee shaII retain all such notices as a register of all assignees in compliance with Section 149(a) of the Code, and shaII make all payments to the assignee or assignees designated in such register. Lessee agrees to execute aII documents that may be reasonably requested by Lessor or any assignee to protect its interests and property assigned pursuant to this Section. Lessee shall not have the right to and shall not assert against any assignee any claim, counterclaim or other right Lessee may have against Lessor or Vendor. Assignments may include 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 2011-55 under the Lease related to such Equipment. Lessee hereby agrees that Lessor may, without notice to Lessee, sell, dispose of, or assign this Agreement or any particular Lease or Leases through a pool, trust, limited partnership, or other similar entity, whereby one or more interests are created in this Agreement or in a Lease or Leases, or in the Equipment listed in or the Rental Payments under a particular Lease or Leases. None of Lessee's right, title and interest in, to and under any Lease or any portion of the Equipment listed in each Lease may be assigned, subleased, or encumbered by Lessee for any reason without obtaining prior written consent of Lessor. 24. Events of Default. 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 a Lease at the time specified therein; (b) failure by Lessee to observe and perform 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 wriUen notice specifying such failure and requesting that it be remedied is given to Lessee by Lessor; (c) any statement, representation or warranty made by Lessee in or pursuant to any Lease shall prove to have been false, incorrect, misleading or breached in any material respect on the date when made; or (d) Lessee institutes any proceedings under any bankruptcy, insolvency, reorganization or similar law or a receiver or similar official is appointed for Lessee or any of its property. 25. 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 immediately due and payable; (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 for the difference between (i) the Rental Payments payable by Lessee pursuant to such Lease and other amounts related to such Lease of 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 7 hereof. The exercise of any such remedies in respect of any such Event of Default shall not relieve Lessee of any other liabilities under any other Lease or the Equipment listed therein; and (c) Lessor may take \vhatever action at law or in equity may appear necessary or desirable to enforce its rights under such Lease ?r as a secured party in any or all of the Equipment. Any net proceeds from the exercise of any remedy under a Lease (after deducting all costs and expenses referenced in the Section) shall be applied as follows: (i) 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; or (ii) 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. 26. No Remedv Exclusive. 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 now or hereafter existing at law or in equity. 27. Notices. All notices or other communications under any Lease shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, to the parties hereto at the addresses listed below (or at such other address as either party hereto shall designate in writing to the other for notices to such party), or to any assignee at its address as it appears on the registration books maintained by Lessee. 28. Release and Indemnification. To the extent permitted by State law, and subject to Section 7, Lessee shall indemnifY, release, protect, hold harmless, save and keep harmless Lessor from and against any and all liability, obligation, loss, claim, tax and damage whatsoever, regardless of cause thereof, and all expenses in connection therewith (including, without limitation, attorney's fees and expenses, penalties connected therewith imposed on interest received) arising out of or as result of (a) entering into any Lease, (b) the ownership of any item of Equipment, (c) the ordering, acquisition, use, operation, 2011-55 condition, purchase, delivery, rejection, storage or return of any item of Equipment, (d) any accident in connection with the operation, use, condition, possession, storage or return of any item of Equipment resulting in damage to property or injury to or death to any person, and/or (e) the breach of any covenant or any material representation contained in a Lease. The indemnification arising under this Section shall continue in full force and effect notwithstanding the full payment of all obligations under all Leases or the termination of the Lease T enn under all Leases for any reason. 29. Miscellaneous Provisions. Each Lease shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. References herein to "Lessor" shall be deemed to include each of its assignees and subsequent assignees from and after the effective date of each assignment as perrnitted by Section 23. In the event any provision of any Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision thereof. Each Lease may be amended by mutual written consent of Lessor and Lessee. 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 the same instrument. The captions or headings in this Agreement and in each Lease are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement or any Lease. This Agreement and each Lease shall be governed by and construed in accordance with the laws of the State. IN WITNESS WHEREOF, Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives as of the date first above written. (LESSOR) Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, AZ 85255 Signature: ~~~~~r~t~e~VVo ~ \~5 \0.01 \ Name/Title: Date: (LESSEE) City of San Bernardino 300 N. "0" Street, 4" Floor, Finance San Bernardino, CA 92418 Signature: Name/Title: Date: APi'ROVED AS TO FORM: James F. Penman, City Attorney By: 2011-55 EXHIBIT A SCHEDULE OF PROPERTY NO. I RE: MASTER EQUIPMENT LEASE PURCHASE AGREEMENT entered into as of March 11,2011, ("Agreement"), between Pinnacle Public Finance, Inc. ("Lessor") and City of San Bernardino ("Lessee"). All terms used and not otherwise defined herein have the meanings ascribed to them in the Agreement. The following items of Equipment are hereby included under this Schedule to the Agreement. To the extent that less than all of the Equipment subject to this Schedule has been installed and accepted by Lessee on or prior to the date hereof, Lessee hereby acknowledges that a portion of the Equipment has not been delivered, installed and accepted by Lessee for purposes of this Lease and Lessor hereby commits to provide funds in an amount sufficient to pay the costs to acquire and install the Equipment. In consideration of the foregoing, Lessee hereby acknowledges and agrees that its obligation to make Rental Payments as set forth in this Schedule is absolute and unconditional as of the date hereof and on each date and in the amounts as set forth in the Rental Payment Schedule, subject to the terms and conditions of the Lease. Ninety five percent of the financing costs are being used to acquire assets that will be capitalized. DESCRIPTION OF EOUlPMENT Quantity Description Model No. Serial No. 1 2 2 I 3 Roll Off Refuse Truck Front Loader Refuse Trucks Side Loader Refuse Trucks Street Sweeper Ford F-550 Trucks Lessee hereby represents, warrants and covenants that its representations, warranties and covenants set forth in the Agreement are true and correct as though made on the Commencement Date of Rental Payments under this Schedule. The terms and provisions of the Agreement (other than to the extent that they relate solely to other Scbedules or Equipment listed on other Scbedules) are hereby incorporated into this Schedule by reference and made a part hereof. Dated: March 11. 201 J Lessor: Pinnacle Public Finance, Inc. Lessee: City of San Bernardino Date: ~D'~Q41~ . een . Jime SIIP,Operatinns d-\ '~'5 \~()II , Signature: Signature: Name/Title: Name/Title: Date: 2011-55 EXHIBIT A-I . RENTAL PAYMENT SCHEDULE RE: Schedule of Property No. I dated March 11,2011 to Master Equipment Lease Purchase Agreement dated as of March 11,2011 between Pinnacle Public Finance, lnc., as Lessor, and City of San Bernardino, as Lessee. Rate 2.8900% Payment Payment Purchase Outstanding Date Amount Interest Principal Price Balance PMNT # 3/11/2011 $2,090,406.11 1 9/11/2011 $165,999.37 $30,206.37 $135,793.00 $1,993,705.37 $1,954,613.11 2 3/11/2012 $165,999.37 $28,244.16 $137,755.21 $1,853,195.06 $1,816,857.90 3 9/11/2012 $165,999.37 $26,253.60 $139,745.77 $1,710,654.37 $1,677,112.13 4 3/11/2013 $165,999.37 $24,234.27 $141,765.10 $1,566,053.97 $1,535,347.03 5 9/11/2013 $165,999.37 $22,185.76 $143,813.61 $1,419,364.09 $1,391,533.42 6 3/11/2014 $165,999.37 $20,107.66 $145,891.71 $1,270,554.54 $1,245,641.71 7 9/11/2014 $165,999.37 $17,999.52 $147,99985 $1,119,59470 $1,097,641.86 8 3/11/2015 $165,999.37 $15,860.92 $150,138.45 $966,453.48 $947,503.41 9 9/11/2015 $165,999.37 $13,691.42 $152,307.95 $811,09937 $795,195.46 10 3/11/2016 $165,999.37 $11,490.57 $154,508.80 $653,500.39 $640,686.66 11 9/11/2016 $165,999.37 $9,257.92 $156,741.45 $493,624.11 $483,945.21 12 3/11/2017 $165,999.37 $6,993.01 $159,006.36 $331,437.63 $324,938.85 13 9/11/2017 $165,999.37 $4,695.37 $161,304.00 $166,907.55 $163,634.85 14 3/11/2018 $165,999.37 $2,364.52 $163,634.85 $0.00 TOTALS $2,323,991.18 $233,585.07 $2,090,406.11 COMMENCEMENT DATE: March 11, 2011 City of San Bernardino Signature: Name/Title: Date: 2011-55 EXHIBIT B FINAL ACCEPTANCE CERTIFICATE Re Schedule of Property No 1 dated March 11, 2011 to Master Equipment Lease Purchase Agreement dated as of March II, 2011 between Pinnacle Public Finance. lnc" as Lessor, and City of San Bernardino, as Lessee In accordance with the Master Equipment Lease Purchase Agreement (the "Agreement"), the undersigned Lessee hereby certifies and represents to, and agrees with Lessor as follows (1) All of the Equipment (as such tenn is defined in the Agreement) listed in the ahove-refcrenced Schedule of Property (the "Schedule") has been delivered, imtalled and accepted on the date hereof (2) Lessee has conducted such inspection and/or testing of the Equipment listed in the Schedule as it deems necessary and appropriate and hereby acknowledges that it accepts the Equipment for all purposes (3) Lessee is currently maintaining the insurance coverage required by' Section 17 urthe Agreement (4) No event or condition that constitutes, or with notice or lapse of time, or both, would constitute, an Event of Default (as defined in the Agreement) exists at the date hereof LESSEE City of San Bernardino Signature NameITitle Acceptance Date 2011-55 INSURANCE COVERAGE REQUIREMENTS LESSOR: Pinnacle Public Finance, Inc. LESSEE: City of San Bernardino Please Reference Control # 100319 on Certificate ofInsurance 1. In accordance with Section 17 of the Agreement, we have instructed the insurance agent named below: (Please fill in name, address and telephone number). Telephone: Fax: ) Contact: a. All Risk Physical Damage Insurance on the leased equipment evidenced by a Certificate ofInsurance and Long Form Loss Payable Clause naming Pinnacle Public Finance, Inc. and/or its assigns, as Loss Payee. Coverage Required: Full Replacement Value b. Public Liability Insurance evidenced by a Certificate of Insurance naming Pinnacle Public Finance, Inc. and/or its assigns as Additional Insured. Minimum Coverage Required: $5,000,000 OR 2. Pursuant to Section 17 of the Agreement, we are self-insured for all risk, physical damage, and public liability and will provide proof of such self-insurance in letter form together with a copy of the statute authorizing this form of insurance. p'roof of insurance coverage will be provided prior to the time the Equipment is delivered to us. PLEASE LIST NAME & ADDRESS AS FOLLOWS: Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, AZ 85255 LESSEE' City of San Bernardino Signature: NameiTitle: Date: 2011-55 PAYMENT INSTRUCTIONS Pursuant to the Master Equipment Lease Purchase Agreement dated March 11,2011 (the "Agreement"), Schedule of Property No. I, dated March I I, 2011, between Pinnacle Public Finance. Inc. (the "Lessor") and City of San Bernardino (the "Lessee"), Lessee hereby acknowledges the obligations to make Rental Payments promptly when due, in accordance with Exhibit A-I to the Agreement. LESSEE NAME: TAX ID#: INVOICE MAILING ADDRESS: Mail invoices to the attention of: Phone ( Fax ( Approval ofInvoices required by: .__~_Phonc (--.-J Fax ( Accounts Payable Contact" Phone ( Fax(___ Processing time for Invoices: Approval:. Checks: Do you have a Purchase Order Number that you would like included on the invoice? 1\0 Yes PO# Do your Purchase order numbers change annually? No_ Yes_ Processing time for neVi purchase orders: LESSEE: City of San Bernardino Signature Name/Tille Date 2011-55 BANK QUALIFIED DESIGNATION SCHEDULE NO.1 DATED MARCH 11, 2011 TO MASTER LEASE PURCHASE AGREEMENT DATED MARCH 11,2011 Lessee hereby represents and certifies the following (please check one): Bank Qualified D Lessee has designated, and hereby designates, this Lease as a "qualified tax-exempt obligation" for the purposes and within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"). In making that designation, Lessee hereby certifies and represents that: . As of the date hereof in the current calendar year, neither Lessee nor any other issuer on behalf of Lessee has designated more than $10,000,000 (the statutory limitation through 12/3l/20 II) of obligations (including this Lease) as "qualified tax-exempt obligations"; . Lessee reasonably anticipates that the total amount of tax-exempt obligations (including fbis Lease) to be issued by or on behalf of Lessee (or allocated to Lessee) during the current calendar year will not exceed $10,000,000; . The Lease will not be at any time a "private activity bond" as defined in Section 141 of the Code; . The Lease is not subject to control by any entity and there are no entities subject to control by Lessee; and . Not more than $10,000,000 of obligations of any kind (including the Lease) issued by, on behalf of or allocated to Lessee will be desiguated for purposes of Section 265(b )(3) of the Code during the current calendar year. Non-Bank Qualified o Lessee has not designated this Lease as a "qualified tax-exempt obligation" for the purposes and within the meaning of Section 265(b)(3) of the Code. LESSEE: City of San Bernardino Signature: x Printed Name/Title: x Date: x 2011-55 PPF 100319 1 Issuer's name Information Return for Tax-Exempt Governmental Obligations II>- Under Internal Revenue Code section 149(e) ... See separate instructions. Caution: If the issue price is under $100,000, use Form 8038~GC. If Amended Return, check here .... D 2 Issuer's errpIoyer identification I'll.f1"bef" (BN) OMS No.1 545-0720 Focm 8038.G (Rev, May 2010) Department of the Treasury Internal Revenue Service Authorit Cit of San Bernardino 3 Number and street (or P.O. box if mail is not delivered to street address) 300 N. "0" Street, 4th Floor, Finance 5 City, town, or post office, state, and ZIP code San Bernardino, CA 92418 7 Name of issue Room/suite 4 Report number (For IRS Use Only) 3 6 Date of issue 03/11/2011 8 CUSIP number Sch of Prop No.1 dtd 3/11/2011 to MELPA dtd 3/11/2011 9 Name and title of officer of the issuer or other person whom the IRS may call for more information 10 Telephone number of officer or other person Ty e of Issue enter the issue rice See instructions and attach schedule 11 Education 12 Health and hospital 13 Transportation. 14 Public safety . 15 Environment (including sewage bonds). 16 Housing 17 Utilities .' . 18 Other. Describe'" Public Works Vehicles 19 If obligations are TANs or RANs, check only box 19a If obligations are BANs. check only box 19b 20 If obligations are in the form of a lease or installment sale, check box ~D ~D ~D 11 Oeser; tion of Obli ations. Com lete for the entire issue for which this form is bein (b) Issue price (cl Stated redemption price at maturity (d) Weighted average maturity (el Yield $2,090,406.11 3.6335 underwriters' discount years 2.8900 % 0 00 $2,090,406 11 0 00 0 00 0 00 0 00 0 00 29 0 00 30 $2,090,406 11 years years 637735 Form B03B-G (Rev. 5-2010) 22 23 24 25 26 27 28 29 30 Proceeds used for accrued interest. Issue price of entire issue (enter amount from line 21, column (b)) Proceeds u,sed for bond issuance costs (including underwriters' discount) Proceeds used for credit enhancement Proceeds allocated to reasonably required reserve or replacement fund. Proceeds used to currently refund prior issues Proceeds used to advance refund prior issues . Total (add lines 24 through 28) . Nonrefundln roceeds of the issue subtract line 29 from line 23 and enter amount here Oeseri tion of Refunded Bonds Com lete this art onl for refund in 24 25 26 27 28 31 Enter the remaining weighted average maturity of the bonds to be currently refunded. 32 Enter the remaining weighted average maturity of the bonds to be advance refunded. 33 Enter the last date on which the refunded bonds will be called (MM/DDIYYYY) 34 Enter the date(s) the refunded bonds were issued iii-- (MM/DDNYVY) For Privacy Act and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 2011-55 Form 8038-G (Rev. 5-2010) Miscellaneous Page 2 38 39 40 Enter the amount of the state volume cap allocated to the issue under section 141 (b)(5) . Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIG) (see instructions) . Enter the final maturity date of the GIC .... Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units 37a b If this issue is a loan made from the proceeds of another tax-exempt issue, check box.... 0 and enter the name of the issuer.... and the date of the issue .... If the Issuer has designated the issue under section 265(b)(3)(B)(i)(lll) (small issuer exception), check box If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box If the issuer has identified a hedge, check box. 35 36a b 37 ~ D ~D ~D Signature and Consent Under penalties at perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowled~w and belief, they are true, correct, and complete. I further declare that I consent to the IRS's disclosure of the issuer's return information. as necessarJ to process this return, to the person that I have authorized above. Paid Preparer's Use Only ~ Signature of issuer's authorized representative Preparer's ... signature ,; Firm's name r yours if self-employed). address, and ZIP code Date ~ Type or print name and title Preparer's SSN or PTIN P01269392 3119149 ( 480 ) 585-3789 Phone no. Form 8038-G (Rev. 5-2010) 2011-55 CERTIFICATE OF SIGNATURE AUTHORITY OF LESSEE March 11,2011 Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite liS Scottsdale, AZ 85255 RE: Schedule of Property No. I dated March II, 20 II ("Lease") to the Master Equipment Lease Purchase Agreement dated March II, 20 II ("Agreement"), by and between City of San Bernardino ("Lessee") and Pinnacle Public Finance, Inc. ("Lessor"). Dear Pinnacle Public Finance, lnc" 1, the undersigned, do hereby certifY (i) that (please print the name llml title of the person who signed the lemie t!ocumellls 011 the line above) the officer of Lessee who executed the foregoing Lease and Agreement on behalf of Lessee and whose genuine signature appears thereon, is the duly qualified and acting officer of Lessee as stated beneath his or her signature and has been authorized to execute the foregoing Lease and Agreement on behalf of Lessee, and (ii) that the budget year of Lessee is from to Sincerely. Signature: Name/Title: Dated: The Certificate of Signature Authority of Lessee should be cxecuted by an authorized individual confirmjug the executioner of the remaining documents is authorized. This document cannot be signed by the person signing the lease documents. 2011-55 ESCROW AGREEMENT This Escrow Agreement, dated as of March II, 20 II by and among Pinnacle Public Finance, Inc., a Delaware corporation ("Lessor"), City of San Bernardino ("Lessee"), and The Bank of New York Mellon Trust Company, N.A., a national banking association with a corporate trust office in St Louis, MO, as Escrow Agent (the "Escrow Agen!"): In consideration of the mutual covenants and agreements herein set forth, the parties hereto do hereby covenant and agree as follows: I. This Escrow Agreement relates to and is hereby made a part of Schedule of Property No. I dated as of the date hereof, between Lessor and Lessee, to the Master Equipment Lease Purchase Agreement dated March II, 20 I] between Lessor and Lessee ("Lease"). 2. Except as otherwise defined herein, all terms defined in the Lease shall have the same meaning for the purposes of this Escrow Agreement as in the Lease. 3. Lessor, Lessee and the Escrow Agent agree that the Escrow Agent will act as sole Escrow Agent under the Lease and this Escrow Agreement, in accordance with the terms and conditions set forth in this Escrow Agreement. The Escrow Agent shall not be deemed to be a party to the Lease and this Escrow Agreement shall be deemed to constitute the entire agreement among Lessor, Lessee, and Escrow Agent. 4. There is hereby established in the custody of Escrow Agent a special trust fund designated the Acquisition Fund (the "Acquisition Fund") to be held and administered by the Escrow Agent in trust for the benefit of Lessor and Lessee in accordance with the Escrow Agreement. 5. (a) Lessor shall deposit $2,090,406.11 in the Acquisition Fund Moneys held by the Escrow Agent hereunder shall be invested and reinvested by the Escrow Agent upon order of a representative of Lessee in Qualified Investments (as hereinafter defined) maturing or subject to redemption at the option of the holder thereof prior to the date on which it is expected that such funds will be needed. Such investments shall be held by the Escrow Agent in the Acquisition Fund, and any interest earned on such investments shall be paid to Lessee. (b) The parties recognize and agree that the Escrow Agent will not provide supervision, recommendations or advice relative to either the investment of the Acquisition Fund or the purchase, sale, retention or other disposition of any Qualified Investment. The Lessee warrants that the investments directed to be purchased by the Escrow Agent pursuant to this paragraph 5 are Qualified Investments as defined in paragraph 6 of this Escrow Agreement. The Lessee will give at least ten (10) business days advance notice for the purchase of United States Treasury Obligations-State and Local Government Series time/demand deposit securities. (c) Any loss or expense incurred from an investment will be borne by the Acquisition Fund. Ifthe Escrow Agent does not receive directions to invest the monies held in the Acquisition Fund, its only obligation with respect to the Acquisition Fund shall be to hold it or deposit uninvested without liability for interest or other compensation to either party. (d) The Escrow Agent is hereby authorized to execute purchase and sales of Qualified Investments through the facilities of its own trading or capital markets operations. The Escrow Agent shall send statements to each of the parties periodically reflecting activity for the Escrow Account for the preceding month. 6. "Qualified Investmcnts" shall be defined for purposes of this Escrow Agreement as follows: 2011-55 (a) For Leases not qualified for the arbitrage rebate exception for small governmental units under Section 148(f)( 4 )(C) of the Code, "Qualified Investments" means, to the extent the same are at the time legal for investment of the funds being invested: (i) United States Treasury Bills or United States Treasury Notes traded on an open market or issued directly by the United States at a yield not exceeding % per annum, (ii) United States Treasury Obligations - State and Local Governmental Series time deposit securities with a yield not exceeding % per annum, (iii) obligations the interest of which is not includable in the gross income of the owner thereof for federal income tax purposes under Section 103 of the Code and which are rated AA or better by Standard & Poors Corporation or Aa or better by Moody's Investors Service, Inc., (iv) shares of qualified regulated investment companies which distribute exempt- interest dividends within the meaning of Section 852 of the Code and which are rated AA or better by Standard & Poors Corporation or Aa or better by Moody's Investors Service, Inc. (tax-exempt mutual funds), (v) United States Treasury Obligations - State and Local Government Series demand deposit securities, or (vi) Money Market Fund or Money Market Deposit Account that is fully FDIC-insured as agreed to by the Lessee. (b) For Leases qualified for the arbitrage rebate exception for small governmental units under Section I 48(f)(4)(C) of the Code, "Qualified Investments" means to the extent the same are at the time legal for investment of the funds being invested: (i) direct general obligations of the United States of America; (ii) obligations, the timely payment of the principal and interest on which is fully and unconditionally guaranteed by the United States of America; (iii) general obligations of the agencies and instrumentalities of the United States of America acceptable to Lessor; (iv) certificates of deposits, time deposits, bank deposits or demand deposits with any bank or savings institution including the Escrow Agent or any affiliate thereof, provided that such certificates of deposit, time deposits, bank deposits or demand deposits, if not insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation, are fully secured by obligations described in (i), (ii) or (iii) above, or (v) repurchase agreements with any state or national bank or trust company, including the Escrow Agent or any affiliate thereof, that are secured by obligations of the type described in (i), (ii) or (iii) above, provided that such collateral is fi'ee and clear of claims of third parties and that the Escrow Agent or a third party acting solely as agent for the Escrow Agent has possession of such collateral and a perfected first security interest in such collateral. 7. Moneys in the Acquisition Fund shall be used to pay for the cost of the acquisition of the Equipment. Payment shall be made from the Acquisition Fund for the cost of acquisition of part or all Equipment upon presentation to the Escrow Agent of one or more properly executed Payment Request and Acceptance Cel1ificates, a form of which is attached hereto as Exhibit A, executed by Lessee and approved by Lessor, together with an invoice for the cost of the acquisition of the Equipment for which payment is requested and a written approval by Lessor of the Vendor to be paid. 8. Concerning the Escrow Agent. Notwithstanding any provision contained herein to the contrary, the Escrow Agent, including its officers, directors, employees and agents, shall: (a) not be liable for any action taken or omitted under this Escrow Agreement so long as it shall have acted in good faith and without negligence; and shall have no responsibility to inquire into or determine the genuineness, authenticity, or sufficiency of any securities, checks, or other documents or instruments submitted to it in connection with its duties hereunder; (b) be entitled to deem the signatories of any documents or instruments submitted to it hereunder as being those purported to be authorized to sign such documents or instruments on behalf of the parties hereto, and shall be entitled to rely upon the genuineness of the signatures of such signatories without inquiry and without requiring substantiating evidence of any kind; and have no liability for acting upon any written and/or facsimile and/or email instructions presented by Lessee/Lessor/Pinnacle Public Finance, Inc. in connection with this Escrow Agreement which the Escrow Agent in good faith believes to be genuine. 2011-55 (c) be entitled to refrain from taking any action contemplated by this Escrow Agreement in the event that it becomes aware of any disagreement between the parties hereto as to any facts or as to the happening of any contemplated event precedent to such action; (d) have no responsibility or liability for any diminution in value of any assets held hereunder which may result from any investments or reinvestment made in accordance with any provision which may be contained herein; (e) be entitled to compensation for its services hereunder as per Exhibit B, which is attached hereto and made a part hereof, and for reimbursement of its out-of-pocket expenses including, but not by way ofIimitation, the fees and costs of attorneys or agents which it may find necessary to engage in performance of its duties hereunder, all to be paid by Lessee, and the Escrow Agent shall have, and is hereby granted, a prior lien upon any property, cash, or assets ofthe Acquisition Fund, with respect to its unpaid fees and nonreimbursed expenses, superior to the interests of any other persons or entities, and shall be entitled and is hereby granted the right to set off and deduct any unpaid fees and/or nonreimbursed expenses from amounts on deposit pursuant to this Escrow Agreement. (I) be under no obligation to invest the deposited funds or the income generated thereby until it has received a Fonn W-9 or W-8, as applicable, from each of the parties hereto, regardless of whether any party is exempt from reporting or withholding requirements under the Internal Revenue Code of 1986, as amended; (g) have no liability for acting upon any written instruction presented by Lessor in connection with this Escrow Agreement which the Escrow Agent in good faith believes to be genuine. Furthermore, the Escrow Agent shall not be liable for nay act or omission in connection with this Agreement except for its own negligence, willful misconduct or bad faith. The Escrow Agent shall not be liable for any loss or diminution in value of the Acquisition Fund as a result of the investments made by the Escrow Agent; (h) in the event any dispute shall arise between the paIiies with respect to the disposition or disbursement of any of the assets held hereunder, be permitted to interplead all of the assets held hereunder into a court of competent jurisdiction, and thereafter be fully relieved from any and all liability or obligation with respect to such interpleaded assets. The parties further agree to pursue any redress or recourse in connection with such a dispute, without making the Escrow Agent a party to same; (i) only have those duties as are specifically provided herein, which shall be deemed purely ministerial in nature, and shall under no circumstance be deemed a fiduciary for any of the parties to this Escrow Agreement. The Escrow Agent shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument, or document between the other parties hereto, in connection herewith, including, without limitation, the Lease referred to in the preamble or the body of this Escrow Agreement. This Agreement sets forth all matters pertinent to the escrow contemplated hereunder, and no additional obligations of the Escrow Agent shall be inferred from the terms of this Escrow Agreement or any other Agreement. IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY (i) DAMAGES OR EXPENSES ARlSING OUT OF THE SERVICES PROVIDED HEREUNDER, OTHER THAN DAMAGES WHICH RESULT FROM THE ESCROW AGENT'S FAILURE TO ACT IN ACCORDANCE WITH THE REASONABLE COMMERCIAL STANDARDS OF THE BANKING BUSINESS, OR (ii) SPECIAL OR CONSEQUENTIAL DAMAGES, EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; (j) have the right, but not the obligation, to consult with nationally-recognized counsel of its choice and shall not be liable for action taken or omitted to be taken by the Escrow Agent either in accordance with the advise of such counselor in accordance with any opinion of counsel to Lessor addressed and delivered to the Escrow Agent; 2011-55 (k) have the right to perform any of its duties hereunder through agents, attorneys, custodians or nominees; and (1) shall not be required by any provision of this Escrow Agreement to expend or risk its own funds in the performance of its duties if it shall have reasonable grounds for believing that repayment of such funds is not reasonably assured to it. Any banking association or corporation into which the Escrow Agent (or substantially all of its corporate trust business) may be merged, converted or with which the Escrow Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Escrow Agent shall be a party, succeed to all the Escrow Agent's rights, obligations and immunities hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. 9. Tax Matters. a) Reporting of Income: The Escrow Agent shall report to the Internal Revenue Service, as of each calendar year-end, all income earned from the investment of any sum held in the Escrow Fund against Lessee, whether or not said income has been distributed during such year, as and to the extend required by law. b) Preparation and Filing of Tax Returns: Any tax returns required to be prepared and filed will be prepared and filed by Lessee with the Internal Revenue Service in all years income is earned, whether or not income is received or distributed in any particular tax year, and Escrow Agent shall have no responsibility for the preparation and/or filing or any tax return with respect to any income earned by the Acquisition Fund. c) Pavment of Taxes: Any taxes payable on income earned from the investment of any sums held in the Acquisition Fund shall be paid by Lessee, whether or not the income was distributed by the Escrow Agent during any particular year. 10. The Acquisition Fund shall terminate upon the occurrence of the earlier of (a) the presentation of a proper Payment Request and Acceptance Certificate with the portion thereof designated "Final Acceptance Certificate" properly executed by Lessee, or (b) the presentation of written notification by the Lessor, or if the Lessor shall have assigned its interest under the Agreement, then the assignees or subassignees of all of Lessor's interest under the Lease or an Agent on their behalf, that an Event of Default has occurred or that Lessee has terminated the Lease pursuant to Section 7 of the Lease. Upon termination as described in clause (a) of this paragraph, any amount remaining in the Acquisition Fund shall be used to prepay, in the sole discretion of the Lessor, either (i) principal payments thereafter due under the lease in the inverse order or their maturities, or (ii) proportionately to each principal payment thereafter due under the Lease. In the event that Lessor elects to apply such amounts in accordance with clause (i) of the preceding sentence, Lessee shall continue to make Rental Payments as scheduled under the Lease. In the event that Lessor elects to apply such amounts in accordance with clause (ii) of this Section 10, Lessor shall provide Lessee with a revised payment schedule which shall reflect the revised principal balance and reduced Rental Payments due under the Lease. Upon termination as described in clause (b) of this paragraph, any amount remaining in the Acquisition Fund shall immediately be paid to Lessor or, pro rata, to any assignees or subassignees of Lessor. II. The Escrow Agent may at any time resign by giving at least 39 days written notice to Lessee and Lessor, but such resignation shall not take effect until the appointment of a successor Escrow Agent. The substitution of another bank or trust company to act as Escrow Agent under this Escrow Agreement may occur by written agreement of Lessor and Lessee. In addition, the Escrow Agent may be removed at any time, with or without cause, by an instrument in writing executed hy the Lessor and Lessee. In the event of any resignation or removal of the Escrow~Agent, a successor Escrow Agent shall bc appointed by an instrument in writing executed by Lessor and Lesscc. Such successor Escrow Agent shall indicate its acceptance of such 2011-55 appointment by an instrument in writing delivered to Lessor, Lessee, and the predecessor Escrow Agent. Thereupon such successor Escrow Agent shall, without any further act or deed, be fully vested with all the trust, powers, rights, duties and obligations of the Escrow Agent under this Escrow Agreement, and the predecessor Escrow Agent shall deliver all moneys and securities held by it under this Escrow Agreement to such successor Escrow Agent. 12. The Escrow Agent incurs no liability to make any disbursements pursuant to the Escrow Agreement except from funds held in the Acquisition Fund. The Escrow Agent makes no representations or warranties as to the title to any Equipment or as to the performance of any obligations of Lessor or Lessee. In the event the Escrow Agent becomes involved in litigation by reason of the administration of the Acquisition Fund, it is hereby authorized to deposit with the appropriate Clerk of the Court, in which the litigation is pending, any and all funds, securities or other property held by it pursuant hereto, less its reasonable fees, expenses and advances, and thereupon shall stand fully relieved and discharged of any further duties regarding the Acquisition Fund. Also, in the event the Escrow Agent is threatened with litigation by reason of this Escrow. Agreement regarding the Acquisition Fund, it is hereby authorized to file an interpleader action in any court of competent jurisdiction and to deposit with the Clerk of such Court, any funds, securities, or other property held by it, less its reasonable fees, expenses and advances, and thereupon shall stand fully relieved and discharged of any further duties regarding the Acquisition Fund. 13. Notices. Any notice, consent or request to be given in connection with any of the terms or provisions of this Escrow Agreement shall be in writing and be given in person, by facsimile transmission or courier delivery service or by mail, and shall become effective (a) on delivery if given in person, (b) on the date of delivery if sent by facsimile with receipt confirmed by telephone or by courier delivery service, or (c) four business days after being deposited in the mails, with proper postage prepaid for first-class registered or certified mail. Notices shall be addressed as follows: (i) if to Lessor: Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, AZ 85255 Attention: Investment Associate Fax Number: (480) 419-3603 (ii) if to Lessee: City of San Bernardino 300 N. "D" Street, 4th Floor, Finance San Bernardino, CA 92418 Attention: Michael Gomez Phone Number: (909) 384-5146 Tax lD: (iii) ifto the Escrow Agent: The Bank of New York Mellon Trust Company, N.A., 911 Washington Ave. St. Louis, MO 63101 14. In the event any provision of this Escrow Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, snch holding shall not invalidate or render unenforceable any other provision hereof. 15. This Escrow Agreement may not be amended except by a written instrument executed by Lessor, Lessee and the Escrow Agent. 2011-55 16. Governing Law, Counterparts. This Agreement shall be construed in accordance with the laws of the State of California. It may be executed in several counterparts, each one of which shall constitute an original and all collectively shall constitute but one instrument. IN WITNESS WHEREOF, Lessor, Lessee and the Escrow Agent have caused this Escrow Agreement to be executed by their duly authorized representatives. Pinnacle Public Finance. Inc. Lessor Citv of San Bernardino Lessee - By~n O'~?\L~ Cathleen D. JI . nez 0 Title: SVP, Operations By: Title: The Bank of New York Mellon Trust Companv. N.A. Escrow Agent By: Title: 2011-55 Exhibit A Escrow Al!reement Pavrnent Reauest and Acceotance Certificate To: The Bank of New York Mellon Trust Company, KA. AUn: James Agnew 911 Washington Ave. St. Louis. MO Phone Number: (314) 613.8203 Fax Number: (314) 613.8286 and Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, A.Z 85255 RE Schedule of Propeli)' No. I dated March 11,2011 to the Master Equipmenl Lease Purchase Agreement dated March 11, 2011 The Escrow Agent is hereby requested to pay from the Acquisition Fund to the person or corporation designated below as Payee, the sum set forth helow in payment of a portion or all of the cost of the acquisition of the equipment described below. The amount shown below is due and payable under the invoice of the Payee attached hereto with respect to the cost of the acquisition of the equipment and has not formed the basis of any prior request for payment. The equipment described below is part or all of the "Equipment" listed in the Schedule of Property No.1 dated March 1 L 201\ to the Master Equipment Lease Purchase Agreement dated March 11,2011 (the "Agreement"). Ouantity Serial Number/Descriotion: Amount: Payee: Payee's Federal JD Number: Lessee hereby l:er1ifies and represents to and alo'lCCS with Lessor a s follows (1) Tile equipment described above has b\:eIl deliv\:red. installed and accepted on the date hereof (2) Lessee has conducted such inspection and/or testing of said equipment as it deems necessary and appropriate and hercby acknowledges that it accepts said equipment for all purposes (3) Lessee is currently maintaining the Insurance covcrage required by Section]7 of the Agreement (4) No event or condition that constitutes, or with notice or lapse of lime or both would constitute, an Event of Default (as stich term is defined in the A!,,'Teement) exists at tbe date hereof Datcd City of San Bernardino LESSEE By Title Approved Pinnacle Public Finance, Inc. LESSOR By____ Title_ FI:-IAL ACCEPTANCE CERTIFICATE m.ns CERTIF!CATE IS TO BE EXECUTED ONLY WHEN ALL EQUIPMENT HAS BEEN ACCEPTED) Tbe undersigned hereby certifies that the equipment described abov\:, together with the equipment described in and acccpted by Payment Request and Acccptance C\:r1ificatcs previously filed by Lessee with the Lessor pursuant 10 the A!,,'Tcemcnt, constitutes all of the Equipment subject to the A!,,'Teemenl Dated LESSEE Bv Tltk 100319 2011-55 Exhibit B Escrow A2:reement (Escrow A2ent Fee Schedule) The Escrow Agent shall be entitled to fees for its ordinary services as follows: A one-time fee of $750.00 upon receipt of the Final Acceptance Certificate signed by Lessor/Lessee. This fee may be paid from interest earnings. In addition, the Escrow Agent shall be entitled to compensation and reimbursement of expenses for any extraordinary service provided pursuant to this Escrow Agreement. The foregoing right shall include the costs of any additional services performed by Escrow Agent which is not customarily considered to be a usual service provided in the administration of this escrow. CUSTOMER NOTICE REQUIRED BY THE USA PATRIOT ACT To help the US government fight the funding of terrorism and money laundering activities, US Federal law requires all financial institutions to obtain, verify, and record information that identifies each person (whether an individual or organization) for which a relationship is established. What this means to you: When you establish a relationship with The Bank of New York Mellon Trust Company, N.A., we will ask you to provide certain information (and documents) that will help us to identify you. We will ask for your organization's name, physical address, tax identification or other government registration number and other information that will help us to identify you. We may also ask for a Certificate of Incorporation or similar document or other pertinent identifying documentation for your type of organization. 2011-55 VENDOR SERVICE AGREEMENT 1 2 3 4 5 WITNESSETH: 6 WHEREAS, the Mayor and Common Council has determined that it is advantageous 7 and in the best interest of the CITY to contract for the purchase of one (I) 2010 Schwarze 8 M6000 (CNO) powered Broom Sweeper; and 9 WHEREAS, the City of San Bernardino did not solicit and accept quotes from 10 available vendors for the purchase of one (I) 2010 Schwarze M6000 (CNO) powered Broom 11 12 Sweeper; and, 13 NOW, THEREFORE, the parties hereto agree as follows: 14 1. SCOPE OF SERVICES. 15 16 17 18 19 2. 20 21 22 23 24 25 26 27 28 This Vendor Service Agreement is entered into this 7th day of March 2011, by and between Crest Chevrolet ("VENDOR") and the City of San Bernardino ("CITY" or "San Bernardino"). For the remuneration stipulated, San Bernardino hereby engages the services of VENDOR to provide those products and services as set forth in its quote, a copy of which is attached hereto as Attachment "2" and incorporated by this reference. COMPENSATION AND EXPENSES. a. For the services delineated above, the CITY, upon presentation of an invoice, shall 3. pay the VENDOR up to the amount of $320,589.07, for the purchase of one (I) 2010 Schwarze M6000 (CNO) powered Broom Sweeper. b. No other expenditures made by VENDOR shall be reimbursed by CITY. TERM; TERMINATION. The term of this agreement shall be for one year. 2011-55 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. WARRANTY Vendor expressly warrants that all products and services supplied to City by Vendor 5. INDEMNITY. Vendor agrees to and shall indemnify and hold the City, its elected otllcials, 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 2 2011-55 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 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 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, 3 2011-55 ancestry, age, mental or physical disability, medical conditions, marital status, sexual gender or 1 2 3 4 sexual orientation, or any other status protected by law. 8. INDEPENDENT CONTRACTOR. VENDOR shall perform work tasks provided by this Agreement, but for all intents and 5 purposes VENDOR shall be an independent contractor and not an agent or employee of the 6 7 8 9 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 10 performed hereunder. 11 12 9. 13 14 15 16 17 18 19 20 BUSINESS REGISTRATION CERTIFICATE AND OTHER REQUIREMENTS. 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 licenses, permits, qualifications, insurance and approval of whatever nature that are legally required of VENDOR to practice its business or profession. 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: 21 TO THE CITY: Public Services Director 300 North "D" Street San Bernardino, CA 92418 Telephone: (909) 384-5140 22 23 24 TO THE VENDOR: 25 26 27 28 Crest Chevrolet 909 West 21 st Street San Bernardino, CA 92402-0501 Telephone: (909) 883-8833 Attn: Dan Zank 4 2011-55 10. ATTORNEYS' FEES. In the event that litigation is brought by any party in connection with this Agreement, n. ASSIGNMENT. VENUE. The parties hereto agree that all actions or proceedings arising in connection with this 21 Agreement shall be tried and litigated either in the State courts located in the County of San 22 Bernardino, State of California or the U.S. District Court for the Central District of California, 23 Riverside Division. The aforementioned choice of venue is intended by the parties to be 24 mandatory and not permissive in nature. 25 26 27 28 13. GOVERNING LAW. This Agreement shall be governed by the laws of the State of California. 5 2011-55 14. SUCCESSORS AND ASSIGNS. 1 2 3 15. HEADINGS. 4 5 6 7 provIsions. 8 16. 9 10 11 12 13 14 and effect. 15 17. ENTIRE AGREEMENT; MODIFICATION. 16 17 18 19 20 21 III 22 III 23 III 24 III 25 26 27 28 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. The subject headings of the sections of this Agreement are included for the purposes of convemence only and shall not affect the construction or the interpretation of any of its SEVERABILITY. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable for any reason, such determination shall not affect the validity or enforceability of the remaining terms and provisions hereof or of the offending provision in any other circumstance, and the remaining provisions of this Agreement shall remain in full force 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. III 6 2011-55 1 2 3 VENDOR SERVICE AGREEMENT CREST CHEVROLET IN WITNESS THEREOF, the parties hereto have executed this Agreement on the day and Iii'" 2011-55 II.~-, ~..\.. 1..' DO iT~ jl!;TODA'!lf I'.\~\; ........... ........., CREST ! -. j ..:l:::;&~,..l.=- · 81, '" : :'~ 1: : ~:-. . . ~~ . : ~ : . . . . . . ...................... 909W, 21st st, . P.Q,Box501 San Bernardino, CA 92402.()501 www.crestchevy.com Phone (909) 6B3-6633 FAX (909) 661>-4416 FEBUARY 9,2011 DON JOHNSON CITY OF SAN BERNARDINO 182 S SIERRA WAY SAN BERNARDINO SUBJECT: SCHWARZE M-6000CNG AS PER OUR CONVERSATION CREST CHEVROLET WILL HANDLE THE DMV PAPERWORK ON THE SOHWARZE M-6000 CNG FOR $250.00. THIS IS A LIST OF THE CHARGES FROM KELLY THE FEE FOR THE DMV PAPERWORK, AND THE CALIFORNIA STATE TIRE FEE FOR EACH UNIT. BASE PRICE SALES TAX SUB TOTAL TIRE FEE CREST CHARGE FOR DM\' PAPERWORK 293,873,00 26,448,57 326,321.57 17.50 250.00 320,589.07 PLEASE CALL ME IF YOU HAVE ANY QUESTIONS. THANK YOU,. . ./ /.) - ___~ __'7~- DANNY ZANK FLEET MANAGER -~/.~ / '- J // ) Factory Authorized ~ Sales and Service ~ .~UIPment 2011-55 Attachment "2" SALES SERVICE PARTS RENTAlS 1884 WOODLAWN STREET, UPLAND, CA 91786 TEL. 909.920.4557 FAX. 909.920.4558 TF. 800.288.7933 WWW.KELLYEQUIPMENT.COMSUPPORT@KELLYEQUIPMENT.COM PROPOSAL Contact: Leon Schrader Company: City of San Bernardino Address: 300 N. 0 Street City, Stale Zip: San Bernardino CA Telephone: Fax: EooMail Address: 92418 Proposal Dillte: 7-Feb-2011 Created By: S. MoEIvy Manufacturer: Schwarze Untt Model: M-6OOllCNG ChasslsfTractor: Sterting Actara FOB Point: Upland, CA Special Instructions: Model: New Schwarze M-6000CNG Slnglo Englno Dosign Conveyor Type Ekwalor v..fIh Chain and Sprocket Drive Squeegee S8-lnoh Main Broom Pneumatic Main Broom PaUem Control, In Cab Adjustment 3-Way Pa&itive Etevlltor Adjustment Elevator Jam A1E1nn and Indicator 35-Gallon Hydl'llulic Reservo.. Dual Gutter Broom Aood Lights Rear Mounted Main Broom Aood Lights Reer Mounted Strube BEIQCOO with Guard Cab Mounted Strobe B8aoon wtth Guard Standard 12-Monlh Warranty Paint Standard White Tenns: COD or Finance Status: New Order Delivery: 60-120 DaysARO Stock #: Order Expires: 3O-Days Untt Specifications S.o Cubla Yom High Dump Hopper Dump Helghl1~lnches to 138-tnches Variable 14,000 Ibs. Hopper LfI Capacity Dual44-lnch Gutter Brooms Dual Gutter Broom nit, Hydraulic, In Cab Control Pneumatic Gutter Broom 00Y<<1 Pressure Control 300-Galon Water Storage Tardl: Front Mounted Spray Bar Main Broom Spray Bar Gutter Broom Spnrv Bar(s} VWmer Level Gauge In Cab 12~VOU Eiecl.ric Water Pump ACMD Rule 1.186 and 1166.1 Certified (pM-1D Certified) Tractor Specifications Cummins 8.9 Lifer CNG Engine AIli80n RO$-3500 5-Speed Automatic Trensmil!il!iion 33,000 Ibs, GVWR Chassis Air Condlioned Cab AMIFMICD Slereo 2...speed Rear Axle Chalmers Rear Suspension Sy&lem Paint Standard While 24M3nth Towing Wananty, Sterling Chassis ADo Lube System Model: 2009 Sterlina Actera Conventional Chassis 133-lnch Whoal Baao Convenllonal Chassis Dual Steering and Controls Dual Alr Ride Seats Cruise Control Air Brakes Grey Vinyl Interior Standard 2~Year Unlmiled Mile ChaB&is Warranty Standard 3-YearTransmission Warranty Wananty: AUl$on Transmis&ion, 5-Y8Qrs Wartanty: Cummins Engine, 5.Yean;, 300,000 Miles Optional Equipment Available Included with Proposal On Site SefVlce and Operator TraIning On SRe Wammty Repair SWeeper No Charge No Charge Safety Camera Syslem, Right and Rear Cameras Below Unit Pricina: .1\ , ~ .. Unit Price: Other: San Bernardino Pricing Structure R3435 Other: Camera Syslem Option Unit Total: Freight, [)Ollvery and POI Documentation Fee: State Tlre Tax, PerTlre Caflfomia S1aie Sal8& Tax: Total Price FOB Destination 18.:5%1 $ 2M,913.DD $ (8,99(l.00) $ 2,450.00 $ 288,373.00 $ 5.500.00 $ $ $ $ 10.50 25,232.64 319,116.14 @ Rale $1.75 Flmmc!ng ProOO5al lease or Loan: length of Term: Proposed lender: Order Tenns ilnd COndUions Amount to Finance: $. lease Residual: $ Interest Rate: Down Payment $ Doc Fee $ Monthly Payment: $ PjllllT~ Price vaijd for30 days unless otherwise Iltated above. Terms are COD or properexeclllOn otnnanc:ing arrangement. In stock units are Sllbjectto prior sale. Oeliveryterms are best estimates and Sll~ect to detay.. beyond our control. Financing term5 provKled for budgetary purposes only and are subject 10 credit approval. New equlJ:lTlent is offerBd with all standard filctory WlIlTl!Inties. Addrional warrantie5 may be available bul: are not part of this propoS2l1 unless otherwise stated. Multi unit or specific unit discounts may require purchlls9 of one or more 1JI1its. A 15% non-refundllble security deposit is required for all special order equipment Kelly Equipment Signature Name customer Signature Name Trtle Tme ;;l, .,. Pinnacle Public Finance A BankUnited Company 2011-55 MASTER EQUIPMENT LEASE PURCHASE AGREEMENT This Master Equipment Lease Purchase Agreement dated as of March II, 2011 and entered into between Pinnacle Public Finance, Inc., a Delaware corporation ("Lessor"), and City of San Bernardino, a body corporate and politic existing under the laws of tbe State of California ("Lessee"). 1. Allreement. Lessee agrees to lease from Lessor certain "Equipment" as described in each Equipment Schedule (Exhibit A), which together with a Rental Payment Schedule (Exhibit A- I) constitute a "Schedule", subject to the terms and conditions of and for the purposes set forth in each Lease. 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. Each Schedule and the terms and provisions of this Agreement (which includes all exhibits hereto, together with any amendments and moditications pursuant thereto) which are incorporated by reference into such Schedule shall constitute a separate and independent lease and installment purchase of the Equipment therein described and are referred to herein as a "Lease". 2. Term. The "Commencement Date" for each Lease is the date when interest commences to accrue 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 11, or (ii) the date on which sufficient monies to purchase the Equipment listed in sLlch Lease are deposited for that purpose with an escrow agent, or (iii) the date sufficient monies are set aside for acquisition of Equipment as evidenced in Exhibit 0, if applicable. The "Lease Term" for each Lease means the Original Term and all Renewal Terms therein provided and for this Agreement means the period from the date hereof until this Agreement is terminated. The "Original Term" means the period from the Commencement Date for each Lease until the end of Lessee's fiscal year or biennium (as the case may be) (the "Fiscal Period") in effect at such Commencement Date. The "Renewal Term" for each Lease is each term having a duration that is coextensive with the Fiscal Period. . 3. Reoresentations and Covenants of Lessee. Lessee represents, covenants and warrants for the benefit of Lessor on the date hereof and as of the Commencement Date of each Lease as follows: (a) Lessee is a public body corporate and politic duly organized and existing under the constitution and laws of the State with full power and authority under the constitution and laws of the state where the Lessee is located ("State") 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 and held in accordance with State law, or by other appropriate official approval, and all requirements have been met and procedures have occurred to enSLlre tbe validity and enforceability of this Agreement and each Lease: (c) Lessee vvill 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: (d) Lessee has complied \vith such public bidding requirements as may be applicable to this Agreement and each Lease and the acquisition by Lessee of the Equipment as provided in each Lease; (e) during the Lease Term, the Equipment will be used by Lessee solely and exclusively for the purpose of perfonning essential governmental or proprietary functions of Lessee consistent with the permissible scope of Lessee's authority; (f) Lessee will annually provide Lessor with current financial statements, budgets, proof of appropriation for the ensuing Fiscal Period, and such other financial information relating to the ability of Lessee to continue each Lease as may be requested by Lessor; and (g) 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. 4. Tax and Arbitra{!e Reoresentations. Lessee hereby represents as follows: (a) the estimated total costs of the Equipment listed in each Schedule will not be less than the total principal portion of the Rental Payments listed in such Rental Payment Schedule; (b) the Equipment listed in each Schedule has been ordered or is expected to be ordered within 6 months of the Commencement Date, and all amounts deposited in escrow to pay for the Equipment, and interest earnings, will be expended on costs of the Equipment and the financing within 3 years of Commencement Date; (c) no proceeds of any Lease \vill be used to reimburse Lessee for expenditures made more than 60 days prior to the Commencement Date or, if earlier, more than 60 days prior to any official action taken to evidence an intent to finance; (d) Lessee has not created or established, and does not expect to create or establish, any sinking fund or similar fund (i) that is reasonably expected to be used to pay the Rental Payments, or (ii) that may be used solely to prevent a default in the payment of the Rental Payments; (e) the Equipment listed in each Schedule has not been and is not expected to be sold or otherwise disposed of by Lessee, either in whole or in part, prior to the last maturity of Rental Payments; (I) Lessee will comply with all applicable provisions of the Internal Revenue Code of 1986, as amended ("Code"), including without limitation Sections 103 and 148 thereof, and the applicable regulations of the Treasury Department to maintain the exclusion of the interest components of Rental Payments from gross income for purposes of federal income taxation; and (g) Lessee intends that each Lease not constitute a "true" lease for federal income tax purposes. 5. Lease of Eouioment. Upon the execution of each Lease, Lessor demises, leases, transfers, and lets to Lessee, and Lessee acquires, rents. leases and hires from Lessor, the Equipment 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 Renc\val 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 Renev....al Term the Lease Term shall be automatically extended upon the successive appropriation by Lessee's governing body of amounts sufficient to pay Rental Payments and other amounts payable under the related Lease during the next succeeding Fiscal Period until all Rental Payments payable under such Lease have been paid in full, unless Lessee shall have terminated such Lease pursuant to Section 7 or Section 22. The terms and conditions during any Renewal Term shall be the same as the terms and conditions during the Original Term, except that the Rental Payments shall be as provided in the applicable Lease. 6. Continuation of Lease Term. Lessee currently intends, subject to Section 7, to continue the Lease Term of each Lease through the Original Term and all Renewal TernlS and to pay the Rental Payments thereunder. Lessee reasonably believes that legally available funds in an amount sufticient to make all Rental Payments during the maximum Lease Term of each Lease can be obtained. Lessee currently intends to do all things lawfully within its power to obtain and maintain funds from which the Rental Payments may be made, including making provision for such payments to the extent necessary in each budget or appropriation request submitted and adopted in accordance with applicable provisions of law. Notwithstanding the foregoing, the decision whether or not to budget and appropriate funds or to extend the applicable Schedule for any Renewal Term is within the discretion of the governing body of Lessee. 7. Nonaoorooriation. Lessee is obligated only to pay such Rental Payments under each Lease as may lawfully be made from funds budgeted and appropriated for that purpose. Should Lessee fail to budget, appropriate or otherwise make available funds to pay Rental Payments under any Lease following the then current Original Term or Renewal Term, such Lease or Leases shall be deemed terminated at the end of the then current Original Term or Renewal Tenn. Lessee agrees to deliver notice to Lessor of such ternlination at least 30 days prior to the end of the then current Original Term or Renewal Tenn, but failure to give such notice shall not extend the term beyond such Original Term or Renewal Term. If any Lease is terminated in accordance with this Section, Lessee agrees to peaceably deliver the Equipment to Lessor at the location(s) to be specified by Lessor. 8. Conditions to Lessor's Performance. This Agreement is not a commitment by Lessor to enter into any Lease not currently in existence, and nothing in this Agreement shall be 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. Lessee will cooperate with Lessor in Lessor's review of any proposed Lease. Lessee understands that Lessor requires certain documentation and information necessary to enter into any Lease and Lessee agrees to 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 concerning the Equipment and its contemplated use and location and documentation or information concerning the financial status of Lessee and other matters related to Lessee. 2011-55 9. Rental Pavments. Lessee shall promptly pay "Rental Payments" as described in Exhibit A-I to each Lease, exclusively from legally available funds, to Lessor on the dates and in such amounts as provided in each Lease, Lessee shall pay Lessor a charge on any Rental Payment not paid on the date such payment is due at the rate of 12% per annum or the maximum rate permitted by law, whichever is less. from such date until paid. Rental Payments consist of principal and interest portions. Lessor and Lessee understand and intend that the obligation of Lessee to pay Rental Payments under each Lease shall constitute a current expense of Lessee and shall not in any way be construed to be a debt of Lessee in contravention uf any-' applicable constitutional or statutu!}' limitation or requirement concerning the creation qf indebtedness hy Lessee, nor shall anything contained herein ur in a Lease constitute a pledge of the general tax revenues, funds or monies of Lessee. 10. RENTAL PAYMENTS TO BE UNCONDITIONAL. EXCEPT AS PROVIDED IN SECTION 7, THE OBLIGATIONS OF LESSEE TO MAKE RENTAL PA YMENTS 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 TO BE DELIVERED OR INSTALLED, ANY DEFECTS, MALFUNCTIONS, BREAKDOWNS OR INFIRMITIES IN THE EQUIPMENT OR ANY ACCIDENT, CONDEMNATION OR UNFORESEEN CIRCUMSTANCES. 11. Deliverv: Installation: Accentance. Lessee shall order the Equipment, cause the Equipment to be delivered and installed at the location specified in each Lease and pay any and all delivery and installation costs in connection therewith. When the Equipment listed in any Lease has been delivered and installed, Lessee shall immediately accept such Equipment and evidence said acceptance by executing and delivering to Lessor an Acceptance Certificate (Exhibit B). Lessor shall provide Lessee with quiet use and enjoyment of the Equipment during the Lease Term. 12. Location: Insnection. Once installed, no item of the Equipment will be moved from the 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 propclty of Lessee for the purpose of inspecting the Equipment. 13. Use: Maintenance. Lessee will not install, use, operate or maintain the Equipment improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by the related Lease. Lessee shall provide all permits and licenses, if any, necessary for the installation and operation of the Equipment. In addition, Lessee agrees to comply in all respects with all applicable laws, regulations and rulings of any legislative, executive, administrative or judicial body. Lessee agrees that it wilL at Lessee's own cost and expense, maintain, preserve and keep the Equipment in good repair and working order. Lessee will enter into a maintenance contract for the Equipment that is acceptable to Lessor. 14. Title. Upon acceptance of the Equipment under a Lease by Lessee, title to the Equipment shali vest in Lessee subject to Lessor's rights under the Lease; provided that title shali thereafter immediately and without any action by Lessee vest in Lessor, and Lessee shali immediately surrender possession of the Equipment to Lessor, upon (a) any termination of the applicable Lease other than termination pursuant to Section 22 or (b) the occurrence of an Event of Default. Transfer of title to Lessor pursuant to this Section shall occur automatical1y without the necessity of any bill of sale, certificate of title or other instrument of conveyance. Lessee shall, nevertheless, execute and deliver any such instruments as Lessor may request to evidence such transfer. 15. Security Interest. To secure the payment of all of Lessee's obligations under each Lease, upon the execution of such Lease, Lessee grants to Lessor a security interest constituting a first and exclusive lien on the Equipment applicable to such Lease and on ali proceeds therefrom. Lessee agrees to execute such additional documents, in form satisfactory to Lessor, which Lessor deems necessary or appropriate to establish and maintain its security interest in the Equipment. The Equipment is and will remain personal property and wili not be deemed to be affixed to or a part of the real estate on which it may be situated. 16. Liens, Taxes, Other Governmental Char~es and Utilitv Char~es. Lessee shall keep the Equipment free of all levies, liens and encumbrances except those created by each Lease. The parties to this Agreement contemplate that the Equipment wili be used for governmental or proprietary purposes of Lessee and that the Equipment wili therefore be exempt from all property taxes. 1 f 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 shali pay ali 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. 17. Insurance. At its own expense, Lessee shall during each Lease Term maintain (a) casualty insurance insuring the Equipment against loss or damage by fire and all other risks covered by the standard extended coverage endorsement then in use in the State and any other risks reasonably required by Lessor, in an amount at least equal to the then applicable "Purchase Price" of the Equipment as described in Exhibit A-I of each Lease; (b) liability insurance that protects Lessee from liability in all events in form and amount satisfactory to Lessor; and (c) workers' compensation coverage as required by the la\vs of the State; provided that, with Lessor's prior written consent, Lessee may self-insure against therisks described in clauses (a) and (b). Lessee shall turnish to Lessor evidence of such insurance or self-insurance coverage throughout each Lease Term. Lessee shall not materially modify or cancel such insurance or self-insurance coverage without first giving written notice thereof to Lessor at least ] 0 days in advance of slIch cancellation or modification. All such insurancl: described in 2011-55 clauses (a) and (b) above shall contain a provIsion nammg Lessor as a loss payee and additional insured. 18. Advances. In the event Lessee shall faii to keep the Equipment in good repair and \vorking order, Lessor may, but shall be under no obligation to, maintain and repair the Equipment and pay the cost thereof. All amounts so advanced by Lessor shall constitute additional rent for the then current Original Term or Renewal Term and Lessee agrees to pay such amounts so advanced by Lessor with interest thereon from the advance date until paid at the rate of 12% per annum or the maximum rate pemitted by law, whichever is less. 19. Dama2e, Destruction and Condemnation. If (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 ot; the Equipment or any part thereof shall be taken under the exercise or threat of the power of eminent domain by any govenunental body or by any person, tirm or corporation acting pursuant to governmental authority. Lessee and Lessor will cause the Net Proceeds to be applied to the prompt replacement, repair, restoration, modification or improvement of the Equipment to substantially the same condition as existed prior to the event causing such damage, destruction, or condemnation, unless Lessee shall have exercised its option to purchase the Equipment pursuant to Section 22. Any balance of the Net Proceeds remaining after sucb work has been completed shall be paid to Lessee. For purposes of this Section, the term "Net Proceeds" shaU mean (y) the amount of insurance proceeds received by Lessee for replacing, repairing, restoring, modifying, or improving damaged or destroyed Equipment, or (z) the amount remaining from the gross proceeds of any condemnation award or sale under threat of condemnation after deducting all expenses, including attorneys' fees, incurred in the collection thereof. If the Net Proceeds are insufficient to pay in full the cost of any replacement, repair, restoration, modification or improvement referred to herein, Lessee shall either (a) complete such replacement, repair, restoration, modification or improvement and pay any costs thereof in excess of the amount of the Net Proceeds, or (b) pursuant to Section 22 purchase Lessor's interest in the Equipment and in any other Equipment listed in the same Lease. The amount of the Net Proceeds, if any, remaining after completing such replacement, repair, restoration, modification or improvement or after purchasing Lessor's interest in the Equipment and such other Equipment shall be retained by Lessee. If Lessee shall make any payments pursuant to this Section, Lessee shall not be entitled to any reimbursement therefor from Lessor nor shall Lessee be entitled to any diminution of the amounts payable under Section 9. 20. 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 WARRANTY WITH RESPECT THERETO WHETHER EXPRESS OR IMPLIED, AND LESSEE ACCEPTS SUCH EQUIPMENT AS IS AND WITH AI.1. FAULTS. IN NO EVENT SHALL LESSOR BE LIABLE FOR ANY INCIDENTAL. INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE IN CONNECTION WITH OR ARISING OUT OF ANY LEASE OR THE EXISTENCE, FURNISHING, FUNCTIONING OR LESSEE'S USE OF ANY ITEM, PRODUCT OR SERVICE PROVIDED FOR IN ANY LEASE. 21. Vendor's Warranties. Lessor hereby irrevocably appoints Lessee as 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 from time to time whatever claims and rights (including without limitation warranties) relating to the Equipment that Lessor may have against Vendor. The term "Vendor" means any supplier or manufacturer of the Equipment as well as the agents or dealers of the manufacturer or supplier from whom Lessor purchased or is purchasing such Equipment. Lessee's sole remedy for the breach of such wan-anty. indemnification or representation shall be against Vendor of the Equipment, and not against Lessor. Any such matter shall not have any effect whatsoever on the rights or 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 Vendor of the Equipment. 22. Purchase Ootion. Lessee shall have the option to purchase Lessor's interest in all of the Equipment listed in any Lease, upon giving written notice to Lessor at least 60 days before the date of purchase, at the following times and upon the following terms: (a) on the Rental Payment dates specified in each Lease, upon payment in full of the Rental Payments then due under such Lease plus the then applicable Purchase Price as referenced in Exhibit A.I; 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 Lessor of its exercise of the purchase option upon payment in full to Lessor of the Rental Payments then due under such Lease plus the then applicable Purchase Price plus accrued interest from the immediately preceding Rental Payment date to such purchase date. 23. Assil:mment. Lessor's right, title and interest in and to each Lease, including Rental Payments and any other amounts payable by Lessee thereunder and all proceeds thererrom, may be assigned and reassigned to one or more assignees or subassignees by Lessor without the necessity of obtaining the consent of Lessee; provided that any such assignment shall not be effective until (a) Lessee has received written notice, signed by the assignor, of the name and address of the assignee, and (b) it is registered on the registration books. Lessee shall retain all such notices as a register of all assignees in compliance with Section I 49(a) of the Code, and shall make all payments to the assignee or assignees designated in such register. Lessee agrees to execute all documents that may be reasonably requested by Lessor or any assignee to protect its interests and property' assigned pursuant to this Section. Lessee shall not have the right to and shall not assert against any assignee any claim, counterclaim or other right Lessee may have against Lessor or Vendor. Assignments may include 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 2011-55 under the Lease related to such Equipment. Lessee hereby agrees that Lessor may, without notice to Lessee, sell, dispose of, or assign this Agreement or any particular Lease or Leases through a pool, trust, limited partnership, or other similar entity, whereby one or more interests are created in this Agreement or in a Lease or Leases, or in the Equipment listed in or the Rental Payments under a particular Lease or Leases. None of Lessee's right, title and interest in, to and under any' Lease or any portion of the Equipment listed in each Lease may be assigned, subleased, or encumbered by Lessee for any reason \vithout obtaining prior written consent of Lessor. 24. Events of Default. 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 a Lease at the time specified therein; (b) failure by Lessee to observe and perform 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 \\Titten notice specifying such failure and requesting that it be remedied is given to Lessee by Lessor; (c) any statement, representation or warranty made by Lessee in or pursuant to any Lease shall prove to have been false, incorrect, misleading or breached in any material respect on the date when made; or (d) Lessee institutes any proceedings under any bankruptcy, insolvency, reorganization or similar law or a receiver or similar ofticial is appointed for Lessee or any of its property. 25. 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 Tenn or Renewal Term to be immediately due and payable; (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 for the difference between (i) the Rental Payments payable by Lessee pursuant to such Lease and other amounts related to such Lease of the Equipment listed therein that are payable by Lessee to the end of the then current Original Term or Renewal Tenn, 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 7 hereof. The exercise of any such remedies in respect of any such Event of Default shall not relieve Lessee of any other liabilities under any other Lease or the Equipment listed therein; and (c) Lessor may take whatever actioll at law or in equity may appear necessary or desirable to enforce its rights under such Lease ?r as a secured party in any or all of the Equipment. Any net proceeds from the exercise of any remedy under a Lease (after deducting all costs and expenses referenced in the Section) shall be applied as follows: (i) 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; or (ii) 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. 26. No Remedv Exclusive. 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 now or hereafter existing at law or in equity. 27. Notices. All notices or other communications under any Lease shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, to the parties hereto at the addresses listed below (or at such other address as either party hereto shall designate in writing to the other for notices to such party), or to any assignee at its address as it appears on the registration books maintained by Lessee. 28. Release and Indemnification. To the extent permitted by State law, and subject to Section 7, Lessee shall indemnify, release, protect, hold harmless, save and keep harmless Lessor from and against any and all liability, obligation, loss, claim, tax and damage whatsoever, regardless of cause thereof, and all expenses in connection therewith (including, without limitation, attorney's fees and expenses, penalties connected therewith imposed on interest received) arising out of or as result of (a) entering into any Lease, (b) the ownership of any item of Equipment, (c) the ordering, acquisition, lise, operation, 2011-55 condition, purchase, delivery, rejection, storage or return of any item of Equipment, (d) any accident in connection with the operation, use, condition, possession, storage or return of any item of Equipment resulting in damage to property or injury to or death to any person, and/or (e) the breach of any covenant or any material representation contained in a Lease. The indemnification arising under this Section shall continue in full force and effect notwithstanding the full payment of all obligations under all Leases or the termination of the Lease Term under all Leases for any reason. 29. Miscellaneous Provisions. Each Lease shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. References herein to "Lessor" shall be deemed to include each of its assignees and subsequent assignees from and after the effective date of each assignment as permitted by Section 23. In the event any provision of any Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision thereof. Each Lease may be amended by mutual written consent of Lessor and Lessee. 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 the same instrument. The captions or headings in this Agreement and in each Lease are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement or any Lease. This Agreement and each Lease shall be governed by and construed in accordance with the laws of the State. IN WITNESS WHEREOF, Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives as of the date first above written. (LESSOR) Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite J 15 Scottsdale, AZ 85255 Signature: M!~~~~t~e~anYo ~ \~5\&O' \ Name/Title: Date: (LESSEE) City of San Bernardino 300 N. "D" Street, 4'" Floo , Finance San Bernardino, CA 8 Signature: Name/Title: eli/1/C16, hrl(/~ '1 3 Jrl //1 , "Y /J1,M/;,~ oc. Date: APPROVED AS TO FORM: James F. Penman, City Attorney <' 2011-55 EXHIBIT A SCHEDULE OF PROPERTY NO.1 RE: MASTER EQUIPMENT LEASE PURCHASE AGREEMENT entered into as of March 11,2011, ("Agreement"), between Pinnacle Public Finance, Inc. ("Lessor") and City of San Bernardino ("Lessee"). All terms used and not otherwise defined herein have the meanings ascribed to them in the Agreement. The following items of Equipment are hereby included under this Schedule to the Agreement. To the extent that less than all of the Equipment subject to this Schedule has heen installed and accepted by Lessee on or prior to the date hereof, Lessee hereby acknowledges that a portion of the Equipment has not been delivered, installed and accepted by Lessee for purposes of this Lease and Lessor hereby commits to provide funds in an amount sufficient to pay the costs to acquire and install the Equipment. In consideration of the foregoing, Lessee hereby acknowledges and agrees that its obligation to make Rental Payments as set forth in this Schedule is absolute and unconditional as of the date hereof and on each date and in the amounts as set forth in the Rental Payment Schedule, subject to the terms and conditions of the Lease. Ninety five percent of the financing costs are being used to acquire assets that will be capitalized. DESCRIPTION OF EQUIPMENT Ouantity Description Model No. Serial No. 1 2 2 ] 3 Roll Off Refuse Truck Front Loader Retuse Trucks Side Loader Refuse Trucks Street Sweeper Ford F-SSO Trucks Lessee hereby represents, warrants and covenants that its representations, warranties and covenants set forth in the Agreement are true and correct as though made on the Commencement Date of Rental Payments under this Schedule. The terms and provisions of the Agreement (other than to the extent that they relate solely to other Schedules or Equipment listed on other Schedules) arc hereby incorporated into this Schedule hy reference and made a part hereof. Dated: March I L 2011 Lessor: Pinnacle Public Finance, Inc. Lessee: City of San Bernardino Signature: ~Ji~e'~d SIIP,Operat;!)"" d\ 'd-'5 \~l)11 , Signature: Name/Title: Name/Title: Date: Date: 2011-55 EXHIBIT A-I RENTAL PAYMENT SCHEDULE RE: Schedule of Property No. I dated March 11,2011 to Master Equipment Lease Purchase Agreement dated as of March 11,2011 betvveen Pinnacle Public Finance, Inc., as Lessor, and City' of San Bernardino, as Lessee. Rate 2.8900% Payment Payment Purchase Outstanding Date Amount Interest Principal Price Balance PMNT # 3/11/2011 $2,090,406.11 1 9/11/2011 $165,999.37 $30,206.37 $135,793.00 $1,993,705.37 $1,954,613.11 2 3/11/2012 $165,999.37 $28,244.16 $137,755.21 $1,853,195.06 $1,816,857.90 3 9/11/2012 $165,999.37 $26,253.60 $139,745.77 $1,710,654.37 $1,677,112.13 4 3/11/2013 $165,999.37 $24,234.27 $141,765.10 $1,566,053.97 $1,535,347.03 5 9/11/2013 $165,999.37 $22,185.76 $143,813.61 $1,419,364.09 $1,391,533.42 6 3/11/2014 $165,999.37 $20,107.66 $145,891.71 $1,270,554.54 $1,245,641.71 7 9/11/2014 $165,999.37 $17,999.52 $147,999.85 $1,119,594.70 $1,097,641.86 8 3/11/2015 $165,999.37 $15,860.92 $150,138.45 $966,453.48 $947,503.41 9 9/11/2015 $165,999.37 $13,691.42 $152,307.95 $811,099.37 $795,195.46 10 3/11/2016 $165,999.37 $11,490.57 $154,508.80 $653,500.39 $640,686.66 11 9/11/2016 $165,999.37 $9,257.92 $156,741.45 $493,624.11 $483,945.21 12 3/11/2017 $165,999.37 $6,993.01 $159,006.36 $331,437.63 $324,938.85 13 9/11/2017 $165,999.37 $4,695.37 $161,304.00 $166,907.55 $163,634.85 14 3/11/2018 $165,999.37 $2,364.52 $163,634.85 $0.00 TOTALS $2,323,991.18 $233,585.07 $2,090,406.11 COMMENCEMENT DATE: March 11,2011 City of San Bernardino Signature: Name/Title: Date: 2011-55 EXHIBIT B FINAL ACCEPTANCE CERTIFICATE Re Schedule of Property No.1 dated March 11,2011 to Master Equipment Lease Purchase Agreement dated as of March II, 201 t between Pinnacle Public Finance, Inc, as Lessor, and City of San I3emardino, as Lessee In accordance with the Master Equipment Lease Purchase Agreement (the "Agreement"). the undersigned Lessee hereby certifies and represents to, and agrees with Lessor as follows (1) All of the Equipment (as such term is defined in the Agreement) listed ill the aho\'c-rdcrenccd Schedule of Property (the "Schedule") has been delivered, installed and accepted on the date hereof (2) Lessee has conducted such inspection and/or testing urlhe Equipml.:llt listed illthc Schedule as it deems necessary and appropriate and hereby acknowledges that it accepts the Equipment for all purposes (3) Lessee IS currently maintaining the insurance coverage required by Section 17 \lrthc Agn:ctllcnt (4) No evelll or condition that constitutes, or with noticc or IlipSC ol'time, or hoth. would constitute, an Event of Default (as derll1cd in the Agreement) exists at the date hereof. LESSEE City of San Bernardino Signature Name/Title Acceptance Date 2011-55 INSURANCE COVERAGE REQUIREMENTS LESSOR: Pinnacle Public Finance, Inc. LESSEE: City of San Bernardino Please Reference Control # 100319 on Certificate ofInsurance 1. In accordance with Section 17 ofthc Agreement, we have instructed the insurance agent named below: (Please fill in name, address and telephone number). Telephone: Fax: Contact: a. All Risk Physical Damage Insurance on the leased equipment evidenced by a Certificate of Insurance and Long Form Loss Payable Clause naming Pinnacle Public Finance. Inc. and/or its assigns, as Loss Payee. Coverage Required: Full Replacement Value b. Public Liability Insurance evidenced by a Certificate of Insurance naming Pinnacle Public Finance, Inc. and/or its assigns as Additional Insured. Minimum Coverage Required: $5.000,000 OR 2. Pursuant to Section 17 of the Agreement, we are selfinsured for all risk, physical damage, and public liability and will provide proof of such self-insurance in letter [ann together with a copy of the statute authorizing this form of insurance. Proofof insurance coverage will be provided prior to the time the Equipment is delivered to us. PLEASE LIST NAME & ADDRESS AS FOLLOWS: Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, AZ 85255 LESSEE: City of San Bernardino Signature: NameITitle: Date: 2011-55 PAYMENT INSTRUCTIONS Pursuant to the Master Equipment Lease Purchase Agreement dated March 11, 2011 (the "AgrccmcnC), Schedule of Property No.1, dated March 11,2011, between Pinnacle Public Finance, Inc. (the ;'Lessor") and City of San Bernardino (the "Lessee"), Lessee hereby acknowledges the obligations to make Rental Payments promptly when due, in accordance with Exhibit ^.} to the Agreement. LESSEE NAME: TAX 10#: INVOICE MAILING ADDRESS' Mail inv'oices to the attention of: Phone (_)~ F,lX ( Approval of Invoices required b,y: ____Phone (_t. Fax I_I Accounts Pa)'able Contact: Phone (_)___ ('axC_J Processing time for Invoices: ,Approval: Checks: Do you have a Purchase Order Number that )'ou would like included on the invoice? No Yes PO# Do your Purchase order numbers change annually? No Ycs~_ Processing time for new purchase ordcrs:___ LESSEE: City of San Bernardino Signature: Name/rille Date 2011-55 BANK QUALIFIED DESIGNATION SCHEDULE NO.1 DATED MARCH 11,2011 TO MASTER LEASE PURCHASE AGREEMENT DATED MARCH 11,2011 Lessee hereby represents and certifies the following (please check one): Bank Qualified n Lessee has designated, and hereby designates, this Lease as a "qualified tax-exempt obligation" for the purposes and within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"). In making that designation, Lessee hereby certifies and represents that: . As of the date hereof in the current calendar year, neither Lessee nor any other issuer on behalf of Lessee has designated more than $10,000,000 (the statutory limitation through 12/31/2011) of obligations (including this Lease) as "qualified tax-exempt obligations"; . Lessee reasonably anticipates that the total amount of tax-exempt obligations (including this Lease) to be issued by or on behalf of Lessee (or allocated to Lessee) during the current calendar year will not exceed $10,000,000; . The Lease will not be at any time a "private activity bond" as defined in Section 141 of the Code; . The Lease is not subject to control by any entity and there arc no entities subject to control by Lessee; and . Not more than $10,000,000 of obligations of any kind (including the Lease) issued by, on behalf of or allocated to Lessee will be designated for purposes of Section 265(b)(3) of the Code during the current calendar year. Non-Bank Qualified D Lessee has not designated this Lease as a "qualified tax-exempt obligation" for the purposes and within the meaning of Section 265(b)(3) of the Code, LESSEE: City of San Bernardino Signature: x Printed Name/Title: x Date: x Line 2: Lines 9 and 10: Line 38: Sillnature and Consent: 2011-55 Instructions for 8038-G: Updated for use with May, 2010 form The below described lines need to be completed by the Lessee: Enter the Lessee's EIN number An issuer (Lessee) that does not have an employer identification number (EIN) should apply for one on Form 58-4, Application for Employer Identification Number. This form may be obtained at Social Security Administration offices or by calling 1-800-TAX-FORM (1-800- 829-3676). You can also get this form on the IRS website at www.irs.qov. You may receive an EIN by telephone by following the instructions for Form SS-4. Enter the name, title, and telephone number of the officer of the Issuer whom the IRS may call for more information If the issuer wishes to designate a person other than an officer of the issuer (including a legal representative Of paid preparer) whom the IRS may call for more information with respect to this return, enter the name, title, and telephone number of such person. Bank Qualified Designation Check this box if this Lease is designated as a "small issuer exception" under section 265(b)(3)(B)(i)(III). (Lessee reasonably anticipates that the total amount of tax-exempt obligations (including this Lease) to be issued by or on behalf of Lessee (or allocated to Lessee) during the calendar year 2011 will not exceed $10,000,000.) Please provide an authorized signature, date, and printed (or typed) name and title of the individual signing on behalf of Lessee. Information Return for Tax-Exempt Governmental Obligations .. Under Internal Revenue Code section 149(e) .. See separate instructions. Caution: If the issue price is under $100,000, use Form B038-GG. If Amended Return, check here ~ D 2 Issuer's errpIoyer identification I'lIJT'ber (8N) 2011-55 Form 8038-G (Rev. May 2010) Department of the Treasury Internal Revenue Service Authorit 1 Issuer's name Cit of San Bernardino 3 Number and street (or P,O. box if mail is not delivered to street address) 300 N. "D" Street, 4th Floor, Finance 5 City, town, or post office, state, and ZIP code San Bernardino, CA 92418 7 Name of issue PPF 100319 OMB No. 1545-0720 6 Date of issue 4 Report number (For IRS Use Only) Room/suite 03/11/2011 8 CUSIP number Sch of Prop No.1 dtd 3/11/2011 to MELPA dtd 3/11/2011 9 Name and title of officer of the issuer or other person whom the IRS may call for more information 10 Telephone number of officer or other person 31 Enter the remaining weighted average maturity of the bonds to be currently refunded. 32 Enter the remaining weighted average maturity of the bonds to be advance refunded. 33 Enter the last date on which the refunded bonds will be called (MM/DDIYYYY) 34 Enter the date(s) the refunded bonds were issued.... (MM/DDNYYY) For Privacy Act and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 637738 Form 8038-G (Rev. 5-2010) enter the issue rice See instructions and attach schedule 11 Education 12 Health and hospital 13 Transportation. 14 Public safety 15 Environment (including sewage bonds). 16 Housing. 17 Utilities . . . . 18 Other. Describe ~ Public Works Vehicles 19 If obligations are TANs or RANs, check only box 19a If obligations are BANs, check only box 19b 20 If obligations are in the form of a lease or installment sale, check box ~D ~D ~D ations, Com lete for the entire issue for which this form is bein filed. (b) Issue price (e) Stated redemption price at maturity (d) Weighted average maturity 03/11/2018 $ 2,090,406.11 $ Uses of Proceeds of Bond Issue includin $2,090,406.11 3.6335 underwriters' discount years 22 23 0 00 0 00 0 00 0 00 0 00 29 30 bonds. ~ ~ ~ 22 23 24 25 26 27 28 29 30 24 25 26 27 28 11 12 13 14 15 16 17 18 $2,090,406 11 (e) Yield 2.8900 % o 00 $2,090,406 11 o 00 $2,090,406 11 years years 2011-55 Form 8038-G (Rev. 5-2010) Page 2 Miscellaneous Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) . Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIG) (see instructions) Enter the final maturity date of the GIC ... Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units b If this issue is a loan made from the proceeds of another tax-exempt issue, check box.... D issuer.... and the date of the issue .... If the ,ssuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box If the issuer has identified a hedge, check box. 35 35 36a 36a b 37 37a and enter the name of the 38 39 40 ~D ~D ~D Signature and Consent Under penalties of perJUry, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. I further declare that I consent to the IRS's disclosure of the issuer's return information, as necessary to process this return, to the person that I have authorized above. Paid Preparer's Use Only ~ Signature of issuer's authorized representative Preparer's ~ signature r; - Firm's name r yours if sell-employed), address, and ZIP code Date Preparer's SSN or PTIN P01269392 3119149 ( 480 ) 585-3789 Form 8038-G (Rev. 5-2010) 2011-55 CERTIFICATE OF SIGNATURE AUTHORITY OF LESSEE March 11,2011 Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, AZ 85255 RE: Schedule of Property No. I dated March II, 20 II ("Lease") to the Master Equipment Lease Purchase Agreement dated March II, 20 II ("Agreement"), by and between City of San Bernardino ("Lessee") and Pinnacle Public Finance, Inc. ("Lessor"). Dear Pinnacle Public Finance, Inc., I, the undersigned, do hereby certify (i) that (please print the name and title of the person who signed the lease documents on the line ahove) the officer of Lessee who executed the foregoing Lease and Agreement on behalf of Lessee and whose genuine signature appears thereon, is the duly qualified and acting officer of Lessee as stated beneath his or her signature and has been authorized to execute the foregoing Lease and Agreement on behalf of Lessee, and (ii) that the budget year of Lessee is from to Sincerely, Signature: NameITitle: Dated: The Certificate of Signature Authority of Lessee should be executed by an authorized individual confirmjng the executioner of the remaining documents is authorized. This document cannot be signed by the person signing the lease documents. 2011-55 ESCROW AGREEMENT This Escrow Agreement, dated as of March 11, 20 II by and among Pinnacle Public Finance, Inc., a Delaware corporation ("Lessor"), City of San Bernardino ("Lessee"), and The Bank of New York Mellon Trust Company, N.A., a national banking association with a corporate trust office in St Louis, MO, as Escrow Agent (the "Escrow Agent"): In consideration of the mutual covenants and agreements herein set forth, the parties hereto do hercby covenant and agree as follows: I. This Escrow Agreement relates to and is hereby made a part of Schedule of Property No. I dated as of the date hereof, between Lessor and Lessee, to the Master Equipment Lease Purchase Agreemcnt dated March 11, 20 II between Lessor and Lessee ("Lease"). 2. Except as otherwise defined herein, all terms defined in the Lease shall have the same meaning for the purposes of this Escrow Agreement as in the Lease. 3. Lessor, Lessee and the Escrow Agent agree that the Escrow Agent will act as sole Escrow Agent under the Lease and this Escrow Agreement, in accordance with the terms and conditions set forth in this Escrow Agreement. The Escrow Agent shall not be deemed to be a party to the Lease and this Escrow Agreement shall be deemed to constitute the entire agreement among Lessor, Lessee, and Escrow Agent. 4. There is hereby established in the custody of Escrow Agent a special trust fund designated the Acquisition Fund (the "Acquisition Fund") to be held and administered by the Escrow Agent in trust for the benefit of Lessor and Lessee in accordance with the Escrow Agreement. 5. (a) Lessor shall deposit $2,090,406.11 in the Acquisition fund. Moneys held by the Escrow Agent hereunder shall be invested and reinvested by the Escrow Agent upon order of a representative of Lessee in Qualified Investments (as hereinafter defined) maturing or subject to redemption at the option of the holder thereof prior to thc date on which it is expected that such funds will be needed. Such investments shall be held by the Escrow Agent in the Acquisition Fund, and any interest earned on such investments shall be paid to Lessee. (b) The parties recognize and agree that the Escrow Agent will not provide supervision, recommendations or advice relative to either the investment of the Acquisition Fund or the purchase, sale, retention or other disposition of any Qualified Investment. The Lessee warrants that the investments directed to be purchased by the Escrow Agent pursuant to this paragraph 5 are Qualified Investments as defined in paragraph 6 of this Escrow Agreement. The Lessee will give at least ten (10) business days advance notice for the purchase of United States Treasury Obligations-State and Local Government Series time/demand deposit securities. (c) Any loss or expense incurred from an investment will be borne by the Acquisition Fund. If the Escrow Agent does not receive directions to invest the monies held in the Acquisition Fund, its only obligation with respect to the Acquisition Fund shall be to hold it or deposit uninvested without liability for interest or other compensation to either party. (d) The Escrow Agent is hereby authorized to execute purchase and sales of Qualified Investments through the facilities of its own trading or capital markets operations. The Escrow Agent shall send statements to each of the parties periodically reflecting activity for the Escrow Account for the preceding month. 6. "Qualified Investments" shall be defined for purposes of this Escrow Agreement as follows: 2011-55 (a) For Leases not qualified for the arbitrage rebate exception for small governmental units under Section 148(1)(4 )(C) of the Code, "Qualified Investments" means, to the extent the same are at the time legal for investment of the funds being invested: (i) United States Treasury Bills or United States Treasury Notes traded on an open market or issued dircctly by the United States at a yield not exceeding % per annum, (ii) Unitcd States Treasury Obligations - State and Local Governmental Series time deposit securities with a yield not exceeding % per annum, (iii) obligations the interest of which is not inclndable in the gross income of the owner thereof for federal income tax purposes under Section 103 of the Code and which are rated AA or better by Standard & Poors Corporation or Aa or better by Moody's Investors Service, Inc., (iv) shares of qualified regulated investment companies which distribute exempt- interest dividends within the meaning of Section 852 of the Code and which are rated AA or better by Standard & Poors Corporation or Aa or better by Moody's Investors Service, Inc. (tax-exempt mutual funds), (v) United States Treasury Obligations - State and Local Government Series demand deposit securities, or (vi) Money Market Fund or Money Market Deposit Account that is fully FDIC-insured as agreed to by the Lessee. (b) For Leases qualified for the arbitrage rcbatc exception for small governmental units nnder Section I 48(1)(4)(C) of the Code, "Qualified Investments" means to thc extent the same are at the time legal for investment of the funds bcing invested: (i) direct general obligations ofthe United States of Amcrica; (ii) obligations, the timely payment of the principal and interest on which is fully and unconditionally guaranteed by the United States of America; (iii) general obligations of the agencies and instrumentalities of the United States of America acceptable to Lessor; (iv) certificates of deposits, time deposits, bank deposits or demand deposits with any bank or savings institution including the Escrow Agent or any affiliate thereof, provided that such ccrtificates of deposit, time deposits, bank deposits or demand deposits, if not insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation, are fully secured by obligations described in (i), (ii) or (iii) above, or (v) repurchase agreements with any state or national bank or trust company, including the Escrow Agent or any affiliate thereof, that are secured by obligations of the typc described in (i), (ii) or (iii) above, provided that such collateral is ITee and clear of claims of third parties and that the Escrow Agent or a third party acting solely as agent for the Escrow Agent has possession of such collateral and a perfected first sccurity interest in such collateral. 7. Moneys in the Acquisition Fund shall be used to pay for the cost of the acquisition ofthe Equipment. Payment shall be made trom thc Acquisition Fund for the cost of acquisition of part or all Equipment upon presentation to the Escrow Agent of one or more properly executed Payment Request and Acceptance Certificates, a form of which is attached hereto as Exhibit A, executed by Lessee and approved by Lessor, together with an invoice for the cost of the acquisition of the Equipment for which payment is requested and a written approval by Lessor of the Vendor to be paid. 8. Concerning the Escrow Agent. Notwithstanding any provision contained herein to the contrary, the Escrow Agent, including its officers, directors, employees and agents, shall: (a) not be liable for any action taken or omitted under this Escrow Agreement so long as it shall have acted in good faith and without negligence; and shall have no responsibility to inquire into or determine the genuineness, authenticity, or sufficiency of any securities, checks, or other documents or instruments submitted to it in connection with its duties hereunder; (b) be entitled to deem the signatories of any documents or instruments submitted to it hereunder as being those purported to be authorized to sign such documents or instruments on behalf of the parties hereto, and shall be entitled to rely upon thc gcnuineness of the signatures of such signatories without inquiry and without requiring substantiating evidence of any kind; and have no liability for acting upon any written and/or facsimilc and/or email instructions prescntcd by Lessee/Lessor/Pinnacle Public Finance, Inc. in connection with this Escrow Agreement which thc Escrow Agent in good faith believcs to be genuine. 2011-55 (c) be entitled to refrain from taking any action contemplated by this Escrow Agreement in the event that it becomes aware of any disagreement between the parties hereto as to any facts or as to the happening of any contemplated event precedent to such action; (d) have no responsibility or liability for any diminution in value of any assets held hereunder which may result from any investments or reinvestment made in accordance with any provision which may be contained herein; (e) be entitled to compensation for its services hereunder as per Exhibit B, which is attached hcrcto and made a part hereof, and for reimbursement of its out-of-pocket expenses including, but not by way of/imitation, the fees and costs of attorneys or agents which it may find necessary to engage in performance of its duties hereunder, all to be paid by Lessee, and the Escrow Agent shall have, and is hereby granted, a prior lien upon any property, cash, or assets of the Acquisition Fund, with respect to its unpaid fees and nonreimbursed expenses, superior to the interests of any other persons or entities, and shall be entitled and is hereby granted the right to set off and deduct any unpaid fees and/or nonreimbursed expenses from amounts on dcposit pursuant to this Escrow Agreement. (I) be under no obligation to invest the deposited funds or the income generated thereby until it has received a Fonn W-9 or W-8, as applicable, from each of the parties hereto, regardless of whether any paliy is exempt from reporting or withholding requirements under the Internal Revenue Code of 1986, as amended; (g) have no liability for acting upon any written instruction presented by Lessor in connection with this Escrow Agreement which the Escrow Agent in good faith believes to be genuine, Furthermore, the Escrow Agent shall not be liable for nay act or omission in connection with this Agreement except for its own negligence, willful misconduct or bad faith, The Escrow Agent shall not be liable for any loss or diminution in value ofthe Acquisition Fund as a result of the investments made by the Escrow Agent; (h) in the event any dispute shall arise between the parties with respect to the disposition or disbursement of any of the assets held hereunder, be permitted to interplead all ofthc assets held hereunder into a court of competent jurisdiction, and thereafter be fully relieved trom any and all liability or obligation with respect to such interpleaded assets, The parties further agree to pursue any redress or recourse in connection with such a dispute, without making the Escrow Agent a party to same; (i) only have those duties as are specifically provided herein, which shall be deemed purely ministerial in nature, and shall under no circumstance be deemed a fiduciary for any of the parties to this Escrow Agreement. The Escrow Agent shall neither be responsible for, nor chargeable with, knowledge of the terms and conditions of any other agreement, instrument, or document between the other parties hereto, in connection herewith, including, without limitation, the Lease referred to in the preamble or the body of this Escrow Agreement. This Agreement sets forth all matters pertinent to the escrow contemplatcd hereunder, and no additional obligations of the Escrow Agent shall be inferred from the terms of this Escrow Agreement or any other Agreement. IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY (i) DAMAGES OR EXPENSES ARlSING OUT OF THE SERVICES PROVIDED HEREUNDER, OTHER THAN DAMAGES WHICH RESULT FROM THE ESCROW AGENT'S FAILURE TO ACT IN ACCORDANCE WITH THE REASONABLE COMMERCIAL STANDARDS OF THE BANKING BUSINESS, OR (ii) SPECIAL OR CONSEQUENTIAL DAMAGES, EVEN IF THE ESCROW AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; Ul have the right, but not the obligation, to consult with nationally-recognized counsel of its choice and shall not be liable for action taken or omitted to be taken by the Escrow Agent either in accordancc with thc advise of such counselor in accordance with any opinion of counscl to Lessor addressed and delivered to the Escro\v Agent; 2011-55 (k) have the right to perform any of its duties hereunder through agents, attorneys, custodians or nominees; and (I) shall not be required by any provision of this Escrow Agreement to expend or risk its own funds in the performance of its duties if it shall have reasonable grounds for believing that repayment of such funds is not reasonably assured to it. Any banking association or corporation into which the Escrow Agent (or substantially all of its corporate trust business) may be merged, converted or with which the Escrow Agent may be consolidated, or any corporation resulting from any mcrger, conversion or consolidation to which the Escrow Agent shall be a party, succeed to all the Escrow Agent's rights, obligations and immunities hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. 9. Tax Matters. a) Reporting of Income: The Escrow Agent shall report to the Internal Revenue Service, as of each calendar year-end, all income earned from the investment of any sum held in the Escrow Fund against Lessee, whether or not said income has been distributed during such year, as and to the extend required by law. b) Preparation and Filing of Tax Returns: Any tax returns required to be prepared and filed will be prepared and filed by Lessee with the Internal Revenue Service in all years income is earned, whether or not income is received or distributed in any particular tax year, and Escrow Agent shall have no responsibility for the preparation and/or filing or any tax return with respect to any income earned by the Acquisition Fund. c) Payment of Taxes: Any taxes payable on income earned from the investment of any sums held in the Acquisition Fund shall be paid by Lessee, whether or not the income was distributed by the Escrow Agent during any particular year. 10. The Acquisition Fund shall terminate upon the occurrence of the earlier of (a) the presentation of a proper Payment Request and Acceptance Certificate with the portion thereof designated "Final Acceptance Certificate" properly executed by Lessee, or (b) the presentation of written notification by the Lessor, or if the Lessor shall have assigned its interest under the Agreement, then the assignees or subassignees of all of Lessor's interest under the Lease or an Agent on their behalf, that an Event of Default has occurred or that Lessee has terminated the Lease pursuant to Section 7 of the Lease. Upon termination as described in clause (a) of this paragraph, any amount remaining in the Acquisition Fund shall be used to prepay, in the sole discretion of the Lessor, either (i) principal payments thereafter due under the lease in the inverse order or their maturities, or (ii) proportionately to each principal payment thereafter due under the Lease. In the event that Lessor elects to apply such amounts in accordance with clause (i) of the preceding sentence, Lessee shall continue to make Rental Payments as scheduled under the Lease. In the event that Lessor elects to apply such amounts in accordance with clause (ii) of this Section 10, Lessor shall provide Lessee with a revised payment schedule which shall reflect the revised principal balance and reduced Rental Payments due under the Lease. Upon termination as described in clause (b) of this paragraph, any amount remaining in the Acquisition Fund shall immediately be paid to Lessor or, pro rata, to any assignees or sub assignees of Lessor. II. The Escrow Agent may at any time resign by giving at least 39 days written notice to Lessee and Lessor, but such rcsignation shall not take effect until the appointment of a successor Escrow Agent. The substitution of another bank or trust company to act as Escrow Agent under this Escrow Agreement may occur by written agreement of Lessor and Lessce. In addition, the Escrow Agent may be removed at any time, with or without cause, by an instrument in writing executed by the Lessor and Lessee. In the event of any resignation or removal of thc Escrow,Agent, a successor Escrow Agent shall be appointed by an instrument in writing executed by Lessor and Lessee. Such successor Escrow Agent shall indicate its acceptance of such 2011-55 appointment by an instrument in writing delivered to Lessor, Lessee, and the predecessor Escrow Agent. Thereupon such successor Escrow Agent shall, without any further act or deed, be fully vested with all the trust, powers, rights, duties and obligations of the Escrow Agent under this Escrow Agreement, and the predecessor Escrow Agent shall deliver all moneys and securities held by it under this Escrow Agreement to such successor Escrow Agent. 12. The Escrow Agent incurs no liability to make any disbursements pursuant to the Escrow Agreement except from funds held in the Acquisition Fund. The Escrow Agent makes no representations or warranties as to the title to any Equipment or as to the performance of any obligations of Lessor or Lessee. In the event the Escrow Agent becomes involved in litigation by reason of the administration ofthe Acquisition Fund, it is hereby authorized to deposit with the appropriate Clerk of the Court, in which the litigation is pending, any and all funds, securities or othcr property held by it pursuant hereto, less its reasonable fees, expenses and advances, and thereupon shall stand fully relieved and discharged of any further duties regarding the Acquisition Fund. Also, in the event the Escrow Agent is threatened with litigation by reason of this Escrow Agreement regarding the Acquisition Fund, it is hereby authorized to file an interpleader action in any court of competent jurisdiction and to deposit with the Clerk of such COutt, any funds, securities, or other propelty held by it, less its reasonable fees, expenses and advances, and thereupon shall stand fully relieved and discharged of any further duties regarding the Acquisition Fund. 13. Notices. Any notice, consent or request to be given in connection with any of the terms or provisions ofthis Escrow Agreement shall be in writing and be given in person, by facsimile transmission or courier delivery service or by mail, and shall become effective (a) on delivery if given in person, (b) on the date of delivery if sent by facsimile with receipt confirmed by telephone or by courier delivery service, or (c) four business days after being deposited in the mails, with proper postage prepaid for first-class registered or certified mail. Notices shall be addressed as follows: (i) if to Lessor: Pinnacle Public Finance, Inc. 8377 East Hartford Drive, Suite 115 Scottsdale, AZ 85255 Attention: Investment Associate Fax Number: (480) 419-3603 (ii) if to Lessee: City of San Bernardino 300 N. "0" Street, 4,h Floor, Finance San Bernardino, CA 92418 Attention: Michael Gomcz Phone Number: (909) 384-5146 Tax ID: (iii) if to the Escrow Agent: The Bank of New York Mellon Trust Company, N.A., 911 Washington Ave. St. Louis, MO 6310 I 14. In the event any provision of this Escrow Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 15. This Escrow Agreement may not be amended except by a written instrumcnt cxccuted by Lessor, Lessee and the Escrow Agent. 2011-55 16. Governing Law, Counterparts. This Agreement shall be construed in accordance with the laws of the State of California. It may be executed in several counterparts, each one of which shall constitute an original and all collectively shall constitute but one instrument. IN WITNESS WHEREOF, Lessor, Lessee and the Escrow Agent have caused this Escrow Agreement to be executed by their duly authorized representatives. Pinnacle Public Finance, Inc. Lessor Citv of San Bernardino Lessee . BY~ ()\rL~ Cathleen D. JI. nez 0 Title: SVP, Operations By: Title: The Bank of New York Mellon Trust Companv, N.A. Escrow Agent By: Title: 2011-55 Exhibit A Escrow Al!reement Payment Reauest and Acceotance Certificate To; The Bank ofNe\\' York Mellon Trust Company, N.A. Attn: .lames Agnew' 911 Washington Ave. St. Louis. MO Phone Number: (314) 613.8203 Fax Number: (314) 613.8286 and Pinnacle Public Finance, Jne. 8377 East Hartford Drive. Suite 115 Scottsdale. AZ 85255 RE: Schedule of Property No. 1 dated March 11, 2011 to the Master Equipmenl Lease Purchase Agreement daled March 11, 2011 The Escrow Agent is hereby' requested to pay from the Acquisition Fund to the person or corporation designated below as Payee. the sum set forth below in payment of a portion or all ofthc cost of the acquisition of the equipment described below. The amount sho\vn bclo\v is due and payable LInder the invoice of the Paj'cc attached hereto with respect to the cost of the acquisition of the equipment and has not formed the basls or any prior request for payment. The equipment described below is part or all of the "Equipment" listed in the Schedule of Property No.1 dated March II. 20 II to the Master Equipment Lease Purchase Agreement dated March 11, 2011 (the "Agreement'"). Ouantitv Serial Number/DescriDtion: Amount: Payee: Payee's FederallD Number: Lt:ssec herl:by certitlesand represents 10 ilndagrccs with Lessor as follows (I) TheequiplllcIlt desnibcd abovc has beell delivt:rt:d. instalJed and accepted on the datehcrcof (2) Lessce has conducted such inspt:diun andior testing of said eqLliprncnt as it deems necessary and appropriate and hereby acknowledges that it accepts said cquipment for all Jllllvoses (]) Lessee is currently maintaining the insurance covcrage required by SectiOll 17 ufthe ^b'TCement (4) No event or condition that eOllstitutes, or with notice ()[' lapse oftimt: or both would constitute, an Event ofDcfault (as such term is dcfiued in the ^b'Teement) exists at the date hereof. Dated City of San Bernardino LESSEE By Title Approved" Pinnacle Public Finance, Inc. LESSOR B)______ TItle --- ._- FINAL ACCEPTANCE CERTIFICATE (THIS CERTIFICATE IS TO BE EXECUTED ONLY WHEN ALL EQUIPMENT HAS BEEN ACCEPTED) lh~ undersi!,'lled hereby certifies that the equipment described above, lOgcther with the equipment described in and accepted by Payment Requcsl and Acceptance Certiticates previously filed by Lesst:t: with the Lessor pursuant to the Agreement constitutes all of tile Equipmcnt subject to the ^h'Teement Dated LESSEE 15: ritle 100319 2011-55 Exhibit B Escrow A~reement (Escrow A2ent Fee Schednle) The Escrow Agent shall be entitled to fees for its ordinary services as follows: A one-time fee of $750.00 npon receipt of the Final Acceptance Certificate signcd by Lessor/Lessee. This fee may be paid from interest earnings. In addition, the Escrow Agent shall be entitled to compensation and reimbursement of expenses for any extraordinary service provided pursuant to this Escrow Agreement. The foregoing right shall include the costs of any additional services performed by Escrow Agent which is not customarily considered to be a usual service provided in the administration of this escrow. CUSTOMER NOTICE REQUIRED BY THE USA PATRIOT ACT To help the US government fight the funding of terrorism and money laundering activities, US Federal law requires all financial institutions to obtain, verify, and record information that identifies each person (whether an individual or organization) for which a relationship is established. What this means to you: When you establish a relationship with The Bank of New York Mellon Trust Company, N.A., we will ask you to provide certain information (and documents) that will help us to identify you. We will ask for your organization's name, physical address, tax identification or other government registration number and other information that will help us to identify you. Wc may also ask for a Certificate of Incorporation or similar document or other pertinent identifying documentation for your type of organization.