Loading...
Municipal Serv/Dump Truck Lease 95MASIFA MUNICIPAL LEASE AND OPTION AGRE©kIQ'1'I' Agt�ett No. 1126 Lessor: Municipal Services Group, Inc. 5125 South Kipling Parkway Suite 300 Littleton, Colorado 80127 Lessee: City of la Quinta P. O. Box 1504 La Quinta, California 92253 This Mender Municipal leave and Option Agreement (the "Agreement') entered into between Municipal Services Group, Ine. (together with any assignee tbereof consecutively referred to herein as the 'f vvi and the City of he Qulrta ('1®ee'), a municipality duty organized and raising under tbe laws of the State of CalifoMa (State); WITNESSETH: WHEREAS, the Lessee devises to finance the Equipment pursuant to the terms of this Agreement and WHEREAS Lessor desires to lease rerfain Equipment (referred to collectively as the'Equipmene Or'Unit(s) of Equipment) to lasfee, and lessee devices to lease the Equipment tram teaser, subject to the terns and conditions of and for the purposes set forth in this Meshr lease Agreement and WHEREAS, the lessor, simutraneously with the execution and delivery of this Agreement, may enter into an eacrosv agreement (the'Escrow Agreement") with an escrow agent whereby the Lower, or its Assignee, if any, shall deposit monies sufficient to acquire the Equipment to be leaad hereunder; and WHEREAS, Lessee is authorized under the Commiution and laws of the State to enter into this Agreement for the purposes set forth herein; NOW, THEREFORE, for and in consideration of the premi es hereinafter contained, the parties hereby agree as follows: lessee represents, cavernous and warrants, for the benefit of leaver and its assignees, as follows: (a) lessee is a public body, corporate and politic, duly organized and existing under the Constitution and laws of the State. (b) lessee will do or cause to be done all things necessary to perverse and keep in full force and effect its examine as a body corporate and politic. (c) Losome is authorized under the Constitution and laws of the State matter into thisAgreement, all Individual Payment Schedules (as defined below) and the transaction contemplated hereby, and to perform all of its obligation hereunder. (d) lasses has been duty authorized to execute and deliver this Agreement and each of the Individual Payment Schedules under the terms and provision of the ordirmnce or resolution of its governing body, attached bereto as Exhibit A. and by other appropriate official approval, and further represents and warrants that all requirements have been met and procedures have accosted in order to imure the enforceability of this Agreement, and lessee has complied with such public bidding requirements as may be applicable to this Agreement and the acquisition by lessee of the Equipment hereunder. lessee shall cause to be executed an opinion of its counsel substantially in the form attached hereto as Exhibit B. (c) During the term of this Agreement, the Equipment will be used by lessee only for the purpose of performing one or more governmental or proprietary function of lessee consistent with the permissible scope of Iasee's authority and will not be used in a trade or business of any person or entity other than the Iesee. (0 Each lease of specthc Equipment or Unit(s) of Equipment hereunder shall be evidenced by an Individual Payment Schedule executed by Lessor and levee describing specific personal property, and setting forth provision relating in the rent, the term of lease, disposition of Equipment upon the expiation of the loam, term and other details with respect to it. The lease for each Unit of Equipment stall become effective on the Accrual Date as def ed below, and the Individual Payment Schedule for the Unit or Units) of Equipment shall specify such dam as the effective date of the 1. (the "Accrual Date). The original term (the "Original Term) of each Individual Payment Schedule slug commence on the Accrual Dare as indicated therein and shall terminate the last day of lessre's then current fiscal year. The term of the lease will be automatically renewed at the end of the Original Term or any renewal term (the "Renewal Term) for an additional one (1) year, unless the governing body of the lessee fails to appropriate sufficient funds for the making of rental payments for the next occurring Renewal Term as provided I. Section 4 of this Agreement The terms and condition during any Renewal Term shot be the same as the terms and condition during the Original Term except that the rental payments shall be m provided in the specific exhibit attached to the applicable Individual Payment Schedule. (g) During the period this Agreement is in force, lessee will annually provide, if requested by lessor, current financial statements, budgets, proof of appropriation for the ensuing fiscal year and such other fuunial information relating to the ale ity of lessee to continue this Agreement as may be reasonably requiumed by lever or its Assignee. (h) Each Unit of Equipment acquired under this Agreement will have a useful life in the hands of the lessee that is substantially in excess of the Original Term and at Renewal Terms specifically [elating to it. 0) At Equipment subject to this Agreement is, and during the period this Agreement is in force shall remain personal property. (j) This Agreement applies to at items of personal property acquired, or to be acquired, by lessee as evidencd by the execution of Individual Payment Schedules from time to time as may be required to fulfill lessee's equipment needs. 1 xpblYl.a.,4 The following terms will have meanings indicated below unless the context clearly requires otherwise: "Accrual Date" is the date when the term of the Individual Payment Schedule begin and lessee's obligation to pay rent accrues. The lease for each Unit of Equipment shall become effective on the Menial Date, which shall be the Dated Date specified in Exhrbit(s) E hereto. 'Acquisition Caet(s)" means the rota) cart of acquiring, including any delivery charges, and preparing the Equipment for the Iess " use. "Adjusted Base Interest Rats" mean the Base Interest Rah as adjusted and as dvcnbed in the Individual Payment Schedule. 'Base Interest Bate' mean the interest rate quoted to lessee at the inception of this Agreement as set forth in the respective Individual Payment Schedules attacbed hereto. "Cerfifficate of Acceptance' means the Certificate of Acceptance attached hereto as Exhibit F relating to the applicable Unit(s) of Equipment whereby Lessee acknowledges receipt of the applicable Unit of Equipment in good condition. Capyright IM Municipal Services Group, Inc. 'Individual Payment Schedole(s)' means the ac edules which identify specific Units of Equipment, the Arcmd Dares of the lease and terms thereof (which are treated as separate leaves) which may became a part of this Agreement from time on time. Each Individual Payment Schadale(s) shall comes of at lent, substantially the form: attached henna as Eshibit(s) A. Exhibk(s) B. Exlubit(s) C. Exhibit(s) D, Exlubit(s) E, and Exlubit(s) F, including an origuW invoice and any other documents needed to perfect a security interest in the Equipment by the lessor. Tease Term' memo collectively the Original Term and all Renewal Terms provided for in this Agreement. 'Purchase Price' muars the amount which Leases, may, in its discretion, pay to tosor in order to purchase the Equipment as set forth in Exhibit(s) E hereto or as set forth in any applicable Individnal Payment Schedule. 'Renal Payments' mean the rental payments payable by lessee for each Unit of Equipment pursuant to the provisions of this Agreement and any applicable Individual Payment Schedule during the lease Term, payable in consideration of the right of Iwce to use the Equipment during the lease Term Rental Payments shall be payable by lessee to the Lessor or its assignee in the amoant and at the time during the lease Term as set forth in the Individual Payment Schedule made a part of this Agreement. Vendor means W the manufacturer/contractor of the Equipment as well as the agents or dealers of the manufacturer from whom lessor purchased or is purchasing the Equipment or (U) shall mean, lessor, U so designated as berem above. ARTIM 3 DEPOSIT OF MONUS; ACQU® AND LEASE OF EQUIPMENT Section 3.01. Deposit of Mor es, Transfers Uoon Acceptance. In the event an Farrow Agreement is entered into paramour to this Agreement, lessor shall cause to be deposited le the Acquisition Fund created under such Escrow Agreement and held by the Escrow Agent, moNe sufficient to acquire the Equipment to be leaned hereunder. Upon the expiration of three years from the Accrual Date, artless notified earlier by the lessor and lessee, the garow, Agent shall apply any monies in the Aequisltion Fund representing the contract price to have been paid to the Vendor(s) for any portion of the Equipment and relatd equipment for which the lessee has nun esteemed a Certificate of Acceptance to the reduction of the Unpaid Principal Balance by paying such monies directly to the Lessor. The remaining Rental Payments shall be amended to reflect such prepayment of principal. The lessor and Issue shall expmse the Revised Individual Payment Schedule m acknowledge such change. Section S.M. lessee is Anent - Acquisition of Ne Fnuipment. Ivor hereby appoints the Lessee as its agent solely for the purpose of acquiring the Equipment and lemee hereby accepts such appointment Imes and lessor will do alt things necessary to effect the acquisition of the Equipment free and clear of any encumbrances ant subject the same to the security interest contemplated hereunder. lesser agrees to acquire the Equipment pursuant to the lessee's specifications. Failure by the Vendors to perform shall not affect lessee's obligation to make Rental Payment under this Agreement (ranee agrees that the Equipment will be acquired I. accordance with the terms, conditions and specifications therefor and on file with the lessor. Upon completion of acquisition of the Equipment satisfactory to the fessee and after authorization by the fessor, but in any event rut later than thirty (30) days following completion of such acquisition, Lessee shag deliver to the Escmw Agent an executed Certificate of Acceptance. Section 3.03. Payment of Acquisition Cost. Payment to the Vendors) of the Acquisition Costs) of acquiring the Equipment shall be made from the monies deposited with this Escrow Agent, as provided in Section 3.01, which shall be disbursed for that purpose in accordance with and upon compliance with Article 2 of the Farrow Agreement. ARTICLE 4 IPASR TERM Section 4.01. lease of Equipment Iasor hereby demises, leases and let to Icssre, and lessee rent, lenses and tires from lessor, the Equipment N accordance with the provisions of thin Agreement m have and to bold for the lease Term. Section 4.02. Commencement of Lease Term. The Original Term of any Individual Payment Schedule shall commence on the Accrual Dam and shall terminate the last day of user's than current fiscal year. The Leave Term will be automatically renewed at the and of the Original Term or any Renewal Term for an additional are year, unleo the Icssee gives written marine to lessor not less than ninety (90) days prior to the end of the Original Term or Renewal Term then us effect, or such other notice as may be provided in Article 6 hereof, of lessee's intention to mrmimte this Agreement at the end of the Original Terse or Renewal Term upon payment of the then applicable Purchase Prue pursuant to Articles 9 or Article 11. as the rase may be. The terms and confidant during any Renewal Term shall be the same as the mans and conditions during the Original Term, except that the Rental Payment sha l be as provided in the applicable Individual Payment SchdWe. Section 4.03. Termination of lease Term. The Lcase Term as it pertains to any Individual Payment ScbedWe will terminate upon the earEest of any of the following event: (a) the expiration of the Original Term or any Renewal Term of the applicable Individual Payment Schedule ant the non -renewal of such Individual Payment Schedule th the event of non -appropriation of funds pursuant to Section 6.06 hereof; (b) the exercise by lessee of the option to purchase the Equipment granted under the provisions of Articles 9 or 11 hereof; (c) a default by Lessee and lessors election to terminate this Agreement under Article 13: or (d) the payment by Lessee of all Rental Payment, ban payment charges, past due finance charges, monies due to release liens of any kind whatsoever, or other taxes anal utilities authorized or required to be paid by lessee hereunder or under any Individual Payment Schedule. This Agreement will automatically terminate in whole upon the last day of the ban Renewal Term with respect many Individual Payment Schdude(s) outstanding plus any other outstanding charges as set forth herein. r s sir n• s e ra lesmr hereby covenant to provide lessee during the lease Term with quiet use and enjoyment of the Equipment, and lessee shall during the lease Term, peaceably and quietly have and hold and enjoy the Equipment, without suit, trouble or hindrance from Lessor, except as expressly set forth in this Agreement lessor shall have the right at all reasonable times during business; hours to enter into and upon the property of lessee for the purpose of inspecting the Equipment ARTIOE 6 RENTAL. PAYI E Section 6.01. Rental Payments Constitute a Current Expense of Lessee. lessor and lessee understand and intend that the obligation of I wee to pay Rental Payment hereunder and under each Individual Payment Schedule shall constitute a current expense of lessee and shall not in any way be construed to be a data of lessee in contravention of any applicable constitutional or statutory limitations or requirement concerning the creation of indebtedness by Izsee, nor shall anything contained herein commute a pledge of the general rax revenues, funds or monies of leaves. Rental Payment shall be in consideration of lessee's use of the Equipment during the year in which such payment are due. Section 6.M. Payment of Renal Payment. lessee shall pay Rental Payment, exclusively from legally available monies from it gemral fund and such other legally available funds as may be designated by the lessee N lawful money of the United Stores of America to Ivor or, in the event of assignment by Ivor, to it Assignee, in the amount and an later than the date set forth in the applicable Individual Payment Schedule(s). lessee further agrees to forward Rental Payment to the Ivor or it Assignee at least ten (10) days prior to the due data thereof, as set forth in each applicable Individual Payment Schedule. In the event the Lessor or it Assignee does not receive Renal Payment within such pedal of time, then and in such event, a Twenty-five dollar (E25.00) late charge will be assessed plus finance charges baud on a Percentage of the outstanding principal balance, equal to the lesser of eighteen Percent (18%) per aunum or the highest interest ram legally allowable under the laws, of the State. Said charges shall be due and payable w of the date of the invoice for such charges. Section 6.03. Interest and Principal Components A portion of each Rental Payment payable hereunder is paid as, and represent payment of, interest, and the balance of the Rental Payment payable hereunder is paid as, and represent payment of, principal. Exhibit(s) E hereto and each Individual Payment Schedule set forth the interest component and the principal component of each Rental Payment during the Original Term and all Renewal Terms of the respective Individual Payment Schedules. Section 6.04. Rental Payment to be Unconditional. The obligations of Lawn to make payment of the Renal Payment required under this Article 6 and other sections of this Agte ssa m, and to perform and observe he covenant and agreement contained herein, shall be absolute and unconditional in all event, except as expressly provided under this Agreement. Notwithstanding any dispute between Lessee and Lessor, any Vendor or any other person. Lease shall make all Rental Payment when due and shall Out withhold any Rental Payment pending foal resolution of such dispme, cur shall lessee assert any right of set-off or counterclaim against its obligation to make such payment required ander this Agreement lessee's obligation to make Rental Payment during the Original Term or any Renewal Term shall not be abated through accident or unforeseen circumstances. Section 6.05. Continuation of lease Term by lessee. L' intends, subject to the provisions of Section 6.06 below, m continue the it. of the Equipment and all Units thereof through the Original Term and all of the Renewal Terms of each Individual Payment Schedule and to snake the Rental Payments as the same shall become due hereunder and under each Individual Payment Schedule lessee reamtably believes that legally available funds in an amount sufficient to make all Rental Payments during the Original Term and each of the Renewal Terms for the Individual Payment Schdules can be obtained. lessee further intends on do all things lawfully within its Power to obtain and maintain hinds from which the Rental Payments may be made, including making provision for such payments to the event necessary in each biennial or mutual budget submitted and adopted in accordance with applicable provisions of the laws of the Stare, to have such portion of the budge approved, and to exhaust all available reviews and appeaH in the event such portion of the budget is out approved. Section 6.06. Non -appropriation. In the event sufficient hinds are tnt available to be appropriated for the Rental payments requires, to be paid in due nest accosting Renewal Term, then lase¢ Trey terminate this Agreement to whole ouly by terminating andes a m y or OR of the Individual Payment Sch althe end of the then coconut Original Teror Renewal Term of the respective Icafvidual Payment Sebdulq and lessee shall not be &Ugated to make payment of the Rental Payments providd for in this Agreement or the Individual Payment Schdules beyond the then current Original or Renewal Tem. lessee agrees to deliver notice to lessor of such termination at least ninety (90) days prior m the end of the then current Original or Renewal Term. If this Agreement is temunatd under the provisions of this Section 6.06, lessee agrees peaceably to deliver the Unit or Units of Equipment subject to the Individual Payment Schedule or Schedules an, terminated to the lessor at the loretion or locations specified by lessor. TO THE EXTENT LAWF'UI, lessee agrees that if funds are appropriated to make Rental Payments for a succeeding fiscal year, it will rat terminate this Agreement or any Individual Payment Schedule during such fiscal year, and that if this Agreement or any Individual Payment Schedule is terminated porsnant to this provision by ran -appropriation prior to the making of all Rental Payments due bereunder, lessee will not replace the Equipment with Use same or similar property or retain others to provide the same or similar mrvira until after the date on which the not occurring Renewal Term of the applicable Individual Payment Schedule or Sell would have ended In the event of Non -appropriation, lessor shall have the right to recover the interest which shall have aeemed on the principal balance outstanding s, of the preceding Renal Payment due date, as set forth in the specific exhibit attached to the applicable Individual Payment Schdule. ARTIOE 7 T= M EQUOk . SECMM MEREST Section 7.01. Title to the Equipment. During the term of this Agreement, tide to the Equipment and any and all additions, repairs, replacements or modifications shall vest in Imes, subject to the rights of lessor hereunder. Following an event of default ns set forth in section 13.01 or nun appropriation as set forth in section 6.06, or upon other termination of this 1 see for any reason other don lease's rights =der Section 4.03, (b), title to the Equipment shall immediately vest in lamr, and Imes will reasonably surrender possession of the Equipment to Ieaor. Section 7.02. Security Interest. To secure the payment of all of lessee's obtgationa under this Agreement, Imes grants to Lessor a security interest commuting a fort lien can din Equipment and on all addition, attachments, accessions and substitutions thereto, and on any proceeds therefrom. lessee agrees m execute such additional documents, including financing statements, affidavits, notices and similar instruments, in fonts satisfactory to lessor, which Ieaor deems naceveary, or appropriate to establish and maintain its security interest, and upon assigmnrnt, the security interest of any Assignees of Imor, in the Equipment. I may request that lessee affix labels to the Equipment showing Lessor's interest in it during the term that the Agreement is in effect. ARTIOE 8 MADOFIIANQ; NWUgCAT1ON; TAXES; DiSURANtY AND O'111PR CHARGES Section 8.01. Maintenance of Equipment by Imee. Lessee agrees that at at tines during the lease Term, at lessee', own con and expense, to cause maintenance to he Performed in such away an ns to make all necessary ad proper repairs, replacements and renewals of such component Pints on may from time to time be required and to maintain, preserve and keep the Equipment in god repair, working order and condition. To the extent of the Provisioner of this Agreement and except as my otherwise be agreed to, neither the Lessor nor any of its Assigns shall have responsibility in any of these matters, or for the making of improvements or additions to the Equipment. Section B.U2. Taxes. Other Governmental Charges and Utility Charges The parties to this Agreement contemplate that the Equipment will be used for a governmental or proprietary purpose of lessee and, therefore, than, the Equipment will he exempt form, all mum presently assessed and levied with respect to personal property. In the event that the use, possession or acquisition of the Equipment is found to be sabject to taxation in any form (except for income rasa of lessor), lessee will pay during the lease Term, as the same respectively came due, all taxes and governmental charges of any kind whatsoever that may at any time be lawfully assesred or levied against or with respect to the Equipment and any equipment or other property acquired by lessee in substitution for, as a renewal or replacement of, or a mdif tion, improvement or addition Or the Equipment; providd that, with respect to any governmental charges Nat may lawfully be paid in installments over a period of years, lessee shall cause m be paid only such installments as have accrued during the tirne this Agreement is in effect. Section 8.03. Previsions Regarding Insurance. At its own expense lessee shall cause casualty, public liability and property damage insurance to be carried and maintained, or shall demonstrate to the satisfaction of lessor that adequate sel6insucance is providd based upon actuarial sound insurunce criteria as are mmiuent with generally accepted insurance industry standards with respect to the Equipment, sufficient to protect the Full Insurable Value (as that term is hereirafter defined) of the Equipment, and to protest lessor from liability in all events. All insurance proceeds From casualty losses shall be payable as hereinafter provided in this Agreement Iessee shall furnish to lessor CedJcata evidencing such coverage throughout the lease Term and for each Individual Payment Schedule. Imee shut notify lessor within five (5) business days of any event of damage to or destruction of the Equipment. The term Tull Insurable Value" an used herein shall mean the full replacement value of the Equipment Any insurance policy pursuant to this Section 8.03 shall be so written or endorsed as to make losses, if any, Payable to Imes and lessor as their respective interests may appear. The Net Proceed[ (at defined in Section 9.G1) of the insurance required in this Section 8.03 shall be applied as provided in Article 9 hereof. Each insurance policy providd for in this Section 8.03 sImU contain a provision to the effect that the insurance company shall not cancel the policy or modify it materially and adversely to the interest of lector witlnut Into giving written novice thereof to lessor at least 30 days in advance of such cancellation. Section 8.04. Advances. In the event Imes shall fat to maintain the full ireurance coverage required by this Agreement or shall fail m keep the Equipment in good repair and operating condition, Imor may (but shall be =der no obligation to) parch. the required policies of insurance and pay the premiums on the same or may cause m be made such repairs or replacements au are uocesary and provide for payment thereof; ad all amounts so advanced therefor by Iessur shall become additional rent for the then current Original Term or Renewal Term for the applicable Individual Payment Schedule or Schedules, which amounts, together with interest thereon at the rate of 18% per armour, lessee agrees to pay. Section 8.05. Tax Covenants. The lessee w91 not make or direct any use of the proceed of the obligation provided herein or any other funds of the Lessee which will cause such obligation to be an "arbitrage bond" within the mcmung of Section 148 of the Cade, to be "federally guaranteed" within the meaning of Section 149 of the Code, or to be a "private activity bond" within the meaning of Section 141 (a) of the Code. To that end, so long an any Renal Payments are unpaid, the lessee, with respect to such proceeds and such other foils, will comply with all requirements of such Cade sections and all regulation, of the United States Department of the Treasury issued thereunder to the extent that such requirements are, at the time, applicable and in effect. Furthermore, to the exert applicable pursuant to Section 148 (f) of the Code, lessee covenants to complete or cause to be completed all reporting requirements and rebate all positive arbitrage to the United States of America lessee covenants that the Equipment will be used only for the purpose of performing one or more governmental or proprietary function of lease, and the Equipment will not be usd lo a trade or business of any person or entity other than the Imes on a basis different from the general public. The Lessee will not use or permit the use of the Equipment by any person for a "private beamoss use" within the meming of Section 141 (b) of the Code in such manner or to such extent as would result in the inclusion of interest received hereunder in grow income for Wood income not purposes under Section 103 of the Code. The lessor and the Lessee shall at all times do and perform at acts and things permitted by law which are neeeaary, or desirable in order to assure that the interest comp want of the Rental Payments will not be included in the grove income of the lessor for federal income tax purposes. ARTIM 9 M F. DESTRUCTION AND coNDE UTgl1: USE OF NRr PR(af}SiRS Section 9.01. Damage, Destruction and Condeno m[ion. Unless lessee shall have exercised IN option to purchase the Equipment or any Unit thereof by making payment of the Purchase Price as provided herein or m the appUcabin Individual Payment Schedule, U prior to the termination of the lease Term (a) the Equipment or any Unit 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 Unit or any pact thereof shall be taken Order the exercise of the power of eminent domain by any governmental body or by any person, firm or corporation acting Order governmental authority, ]cease and lessor will cause the No Proceeds (as def ed below) of any insurance claim or condemnation awarded to be applied to the prompt repair, maturation, modification or improvement of the Equipment. Any balance of the Net Proceeds remaining after such work has been completed shall be paid to Lessee. For purposes of Section 8.03 and this Article 9, the term Net Proceeds" shall mean the amount remaining from the grey proceeds of any insurance claim or condemnation award after deducting all expenses (including attorneys' fees) incurred in the collection of such claim or award. Section 9.02. Insu(ficienev of Net Proceeds. Subject to the lessee's right to terminate Nis Agreement or any Individual Payment Schedule under Section 6.06 hereof, if the Net Proceed are insufficient m pay ta fall the cost of any repair, restoration, modification or improvement elected to in Section 9.01 hereof, lessee shall either (a) complete the repair or replacement of damaged property and Pay any cosy in excess of the amount of Net Proceeds or (b) pay to the lessor the amount of the applicable Purchase Price, applying Net Proceeds in such payment. ARTRIE 10 DISC, A OF WARRANTIES, VENDORS WARRANTEE% USE ap nlE EQU�/aHf Section 10.01. Disclaimer of Warranties. AS BETWEEN LESSOR AND LESSEE, DELIVERY OF EQUIPMENT TO LESSEE AND EXECUTION BY LESSEE OF AN INDMDUAL PAYMENT SCHEDULE WITH RESPECT THERETO SHALL CONSTITUTE LESSEES ACKNOWLEDGEMENT THAT THE EQUIPMENT IS IN GOOD ORDER AND CONDITION AND IS OF THE MANUFACTURE, DESIGN AND CAPACITY SELECTED BY THE LESSEE, THAT THE LESSEE IS SATISFIED THAT THE SAME IS SUITABLE FOR ITS PURPOSE, AND THAT FOR PURPOSES OF THIS AGREEMENT LESSORS ASSIGNEES MAKE NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED WITH RESPECT TO EQUIPMENT, INCLUDING WITHOUT LIMITATION, ITS VALUE, DESIGN, CAPACITY, CONDITION, MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE OR FITNESS INTENDED FOR USE OF THE EQUIPMENT, OR WARRANTY WITH RESPECT THERETO AND LESSOR AND ITS ASSIGNEES HEREBY DISCLAIM ALL SUCH REPRESENTATIONS AND WARRANTIES. THIS SECTION IS INTENDED APPLY BETWEEN THE LESSOR AND LESSEE ONLY TO THE EXTENT OF THE FINANCING CONTEMPLATED HEREIN AND IN NO ,VENT IS INTENDED TO AFFECT THE WARRANTIES OR REPRESENTATIONS CONTAINED IN OR INCLUDED WITHIN ANY CONTRACT ENTERED INTO FOR THE ACQUISITION OF THE EQUIPMENT EITHER WITH THE LESSOR, OR ANY OTHER VENDOR. NOTWITHSTANDING THE FOREGOING, IN THE EVENT LESSOR IS A VENDOR, LESSEE SHM,L BE ENTITLED TO ALL APPLICABLE VENDOR WARRANnES AS TO THE EQUIPMENT, PROVIDED THAT SUCH RIGHTS SHALL PERTAIN SOLELY TO LESSOR AS VENDOR, AND NOT n1 ANY SUCCESSORS OR ASSIGNS OF LESSOR UNDER THIS LEASE. In no event shall an Assigmo, if any, of lessor be liable for any incidental, induced, special or comnqumtiai damage in connection with or arising out of this Agreement or the aistence, furnishing, functioning or lessee's We of any item or products or services provided for in this Agreement. Section 10.02. Vendor's Warranties. lessor hereby Urevocably appoints Lessee its agent and attorney in -fad during the lease Term, so long as Lessee shall not be to default hereunder, to assert from time to time whatever claims and rights, including warranties of the Equipment, which lessor may have against the Vendor of rive Equipment beseevs, sole comedy for the branch of each warranty, indemnification or representation shag be against the Vendor of the Equipment and runt against an Assignee, if any, of lessor, nor shall such matter have my effect whatsoever on the rights and obligations of lessor with respect to this Agreement including the right to receive fail and timely payments hereunder. lessee expressly acknowledges that an Assignee, if any, of lessor makes, and has made, no representation or warranties whatsoever as to the emanate or avaflabifity of such warranties of the Vendor of des Equipment Se lion 1U.03. Use of the Equipment. leave will not use, operate or maintain the Equipment or cause the Equipment m be rued, operatedor maintained improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by this Agreement lessee shall provide or cause to be provided all permitr and licenses, U any, necessary for the operation of the Equipment; provided, however, that lessee nay contest te good faith the validity or application of any such law or rule in any reasonable manner which does no, in the opinion of lessor, adversely affect the estate of Lessor in and many of the items of the Equipment or its interest or rights under this Agreement Losses shall notify Lessor within five (5) business days if there are any claims or lawsuits arising in connection with the Equipment or use thereof. ARTIOE 11 opnox To PORt]iASE The Lessee is hereby granted the option to prepay all or a portion of its obligations under this Agreement and purchase the Equipment or any Unk thereof for the Purchase Prim set forth in Eshbit(s) E hereto or on any applicable Individual Payment Schedule(s). At the coquet of lessee, lessor's security interest in the Equipment will be termiwtd and this Agreement shall terminate: (a) at the end of the lease Term, upon payment in fail of Rental Payments due hereunder, plus all part due charges. U any; or (b) at any time during the Original Term or any Renewal Term, upon payment by lessee of the then applicable Purchase Prim as set forth ta the applicable Individual Payment Schedule, plus all part due charges, if any; or it) if the lease Term is terminated pursuant to Andcle 9 of this Agreement, in the event of coal damage, destr adon or condemnation of the Equipment or any Unit thereof and, U lessee is not on such data in default under this Agreement, upon payment of the then applicable Purchase Prim to lessor plus all past due charges, U any, subject to the lessee's right to terminate this Agreement or any Individual Payment Schedule under Section 6.06 hereof. In the event the Lessee purchase less than all of the Equipment, the related Individual Payment Schdule(s) shall be amended to relied such prepayment of principal and the remaining Rental Payments, shall be adjusted seconlingby. Further, the lessor and lessee agree to execute such reviaed Individual Payment Schedulebs). ARTIOE 12 ASSIGNMENT SUBIFASING, IND�T10N MORTGAGING AND SFJ1dNG Section 12.01. Aaiemnen[ by lector. This Agreement, and the lea es right to receive payte n s hereuMer, may be assigned ad reassigned in whole or in pan to one or more assignaa or subaaigune by lessor at any time subsequent to this mmdm n, without the necessary of obtaining the ..at of lessee; provided, however, that no such assignment or reassignment shall be effective males need Until (i) lessee shall have received notice of the assignment or reassignment disclosing the name sad address of the aaignee or subassignee, and (u) in the event that such aaigmnent or reassignment is made to a bank or trust company as remand, for holders of certificate or other evidence representing interest in this Agreement, or rights to receive amounts hereuMe, such bank or rust company agrees to maintain, or cause to be maintained on behalf of and as agent for Lesser, a bankentrysystem by which a reronl of the rmme and addresses of such holders as of any particular time is kept and agre®, upon request of lessee, to furnish such information to lessee. Upon receipt of notice of assignment, lessee agrees to reflect in a book entry the Assignee designated in such entire of assignment, and to make all payments to the Assignee designated in the noire of assignment, notwithstanding any claim, defense, set-off qr counterclaim whensoever (whether arising farm a breach of this Agreement or otherwise) that Lessee may from time to time have against lessor, or the Assignee. Lessee agrees to execute all documents, including nofiee of assignment and chattel mortgages or financing statements which may be reasonably requested by lessor or is Assignee to protect their interests in the Equipment and in this Agreement. Section 12.02. No Sale, Assignment or Subleasing by lessee. This Agreement and the interest of lessee in the Equipment may not be sold, assigned or encumbered by lemse without the prior written consent of lessor, which consent maybe withheld in the total discretion of the lessor taking into arrow, among other things, the treatment for federal income cos purposes of the interest component of Rental Payments. Section 12A3. Release and Indemnification Covenants. Except for the intentional or negligent ads of the Lessor or any of its employees or agents thereof arising out of or as the made of entering into this Agreement and to the extent Permitted by the laws and Constitution of the State, lessee shall protect, hold hunches and indemnify lector from ad against any and all liability, obligations, loess, claims and damages whatsoever, regardless of cause thereof, and expense in connection therewith, including, without finatation, counsel fees and apensa, penalties and interest arising out of or as the ra ak of the entering into of this Agreement, the ownership of any item of purchase, delivery, rejection, storage or towns of any item of the Equipment or any actident in connection with the operation, use, condition, possession, storage or rearm of any item of the Equipment resulting in damage to property or injury to or death to any person. The indem illimu on arising under this paragraph shall continue in fall forte and effect notwithstanding the full payment of all obligations under this Agreement or the termination of the Lease Term for any reason. lessee agree not m withhold or abate any portion of the payments required pursuant to this Agreement by reason of any defects, malfunctions, breakdowns or infirmities of the Equipment. To the extent the law allows, the Lessor shall indemnify hem agame and hold lessee harmless from any and all claims, actions, suits, proceedings, cause, expenses, damages, and liabilifies, including attorneys fors, arising out of, com creed with, or resulting from the negligmer or misconduct of lessor in performing its obligations under this lease. ARMC E 13 EVENTS OF DEFAULT AND RFI,®DS Section 13.01. Events of Default Defined. The following shall be "events of default under this Agreement and the terms 'event of defaule and "default' shall mean, whenever they are used in this Agreement, any one or more of the following events: (a) Failure by lessee to pay my Rental Payment or other payment required to be paid heremder at the time specified herein; and (b) Failure by lessee to observe and perform any covetuen, condition or agreement on its part to be observed or performed, other than as referred to in Section 13.01 (a), for a period of W days after written notice, specifying such faaume and requesting that it be remedied as given to lessee by Lauer, unlea besme shall agree in writing to an extension of such time prior to its apimthn; provided, howeer, if the failure stated in the notice cannot be roosted within the applicable Period, lessor will not unreasonably withhold its consent to an daemon of such time U corrosive action deemed appropriate by lessor in its sole discretion, is instituted by Lester, within the applicable Period and diligently purmod unit the default is corrected; and (c) A determination by Lessor that any representation or warranty of Lessee was untrue when made. The foregoing provision of this Section 13.01 are subject to (I) the provisions of Section 6.01; and (u) 9 by reason of force majeure lessee is enable in whole or in part to carry out its agreement on its part herein contained, other than the obligations on the part of Lessee contained in Article 6 and Section 8.03 boreal, lessee shall not be deemed in default during the moderated, of such inability. The Wren 'force majeure as used herein shall mean, without limitation, the following: ado of God, strikes, lockouts or other industrial disturbance; acts of public enemies, orders or restraints of any kind of the government of the United States of America or of the sate wherein lease is located or any of their departments, agencies or officials, or any civil or military authority; usnrmcrions; tins; lands4da; earthquakes; fires; storms; droughts; fioods; or explosions. Section 13.02. Revent emedies on Default. Whenever any of default referred to in Section 13AU hereof shall have happened and be continuing, lessor shall have the right, at its sole option without harbor demand or nonce, to coke one or any combination of the following remedial steps: (a) With or without terminating this Agreement, (i) enter upon the location and retake possession of the Equipment and set, lease or sublease the Equipment far the account of lessee, holding lesec liable for the rents and other amounts payable by icsee hereunder to the end of the Original Term or the then current Renewal Term; or fill require lessen to assemble, pack, return ant My the mats of returning the Equipment, within ten (10) days, to a location specified by the ftsor, and (b) Take whatever action at law or in equity may appear accusary, or desirable to enforce its rights m the lessor of the Equipment. Section 13.03. No Remedy Exclusive. No remedy herein conferred upon or reserved to ]esar is intended to be exclusive and every such remedy shall be cumulative and shag be in addition to every other remedy given under this Agreement or now or hereafter euisting at law or in equity. Any repossession or subsequent sale or lease by lessor of any item or Unit of Equipment shag not bar an action against Lessee for a deficiency, ant the bringing of any action against or the entry of judgment aga4ut lessee shag not bar lessors right to reposeas any or all Units of Equipment. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be consmned to be a waiver thereof, but any such right and power may be eaerciaed from time to time and as often as maybe deemed expedient. ARTIOF 14 1LLSmlANiU15 Section 14.01. Notices. All notica, certificates or other communication hereunder shag be sufficiently given and shall be deemed given when delivered or mailed by registered nag, postage prepaid, to the parties at they respective places of bossiness. Section 14.02. Binding Effect. This Agreement shall inure to the benefit of and shall be binding upon lessor and lessee and their respective sucresmrs and assign. Section 14.03. Sevembility. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall Out invalidate or renter unenforceable any Other provision hereof. Section 14.M. Amendments. The terms of this Agreement shag not be waived, altered, modified, supplemented or amended in any mamer whatsoever except by written instrument signed by the lessor and the lesscr, Our shag any such amendment that affect the rights of lessor's Assignee be effective without such Assignee's consent Section 14.05. Execution in Counterparts. This Agreement may be esecuted in several counterparts, each of which shag be an original and all of which shall constitute but one and the same instrument Section 14.06. Applicable law. This Agreement shall be governed by and mewed in accordance with the laws of the State of California. 5 tion 14.07. Captions. The captiotu or headings in thin Agreement are for convenience only and in no way defrm, limit or deunbe the scope or intent of any provisions or sections of this Agreement Section 14.08. Entire Agreement This Agreement constitutes the entire agreement between Iesmr and lessee. No waiver, common, modification or change of terms of this Agreement shall bind either party unless in writing signed by both parties, and then sub waiver, mment, modification or change shag be effective only in the specific instance and for the specific purpose given There are no understandings, agreements, representations or warranties, express or implied, not specified herein regarding this Agreement or the Equipment leased hereunder. Any come and conditions of any purchase order or other document submitted by lessee in connection with this Agreement which are in addition m or inconsistent with the terms and conditions of this Agreement will not be binding on lessor and will not apply m this Agreement twee by the signature below of its author ted representative acknowledges that it has read this Agreement. understands it, and agrees to be bound by is to. and conditions. IN WITNESS WHEREOF, lessor has executed this Agreement in is corporate name with is corporate seal hereunto affixed and athshd by is duty authorized officers, and tasee has mused this Agreement to be executed in is corporate name with is corporate seal hereunto affixed and attested by is duty authorized officers. Tuis document is dated as of the Accrued Date, whether or nor esecufed as of such data. LESSEE: City of La Quinta Tit Da LESSOR: Municipal Services Croup, Inc. 11 MIN., i� INDIVIDUAL PAYMENT SCHEDULE #1 m MASTER MUNICIPAL LEASE AND OPTION AGREEMENT NUMBER 1126 Entered into March 2, 199S, (the "Dated Date") by and between the lessor and the lessee. This Individual Payment Schedule #1 is made a part of Master Municipal I, and Option Agreement Number 1126 and hereby incorporates all terms and conditions of said Agreement with respect to Lessee's and Lessor's rights in the personal property described in this Schedule. This Individual Pavment Schedule consists of: Exhibit A Resolution of Governing Body Exhibit B Opinion of Lessee's Counsel Exhibit C Certificate as to Arbitrage Exhibit D Description of Equipment Exhibit E Schedule of Payments Exhibit F Acceptance Certificate Exhibit G Insurance Coverage Requirements Supplements: 8038-G IRS Filing Bank Eligibility Certificate Small Issuer Exemption Certificate LESSOR: Municipal Services Group, Inc. �u !/ Date:i LESSEE: By: �',\C`iiitty of La Quint_a,//n !"�/// / Title: Date: Agreement No. 1126 a•.t.n: s R SOLIITION OF GOVERNING BODY EXTRACT OF MINUTES LESSEE: City of La Quinta At a duly called meeting of the governing body of Lessee held on theday of �-b ru2e 19 'FS the following resolution was introduced and adopted. RESOLVED, whereas the governing body of Lessee has determined that a true and very real need exists for the acquisition of the Equipment described in the Individual Payment Schedule No. 1 and/or the Master Municipal Lease and Option Agreement No. 1126 (the "Agreement'D presented to this meeting; and WHEREAS, the governing body of Lessee has taken the necessary steps, including any legal bidding requirements, under applicable law to arrange for the acquisition of such Equipment, WHEREAS, the governing body hereby directs its legal counsel to review the Agreement and negotiate appropriate modifications to said Agreement so as to assure compliance with state law and local statutory law, prior to execution of the agreement by those persons so authorized by the governing body for such purpose, BE TT RESOLVED, by the governing body of lessee that: Finding: Authorized Officers. The terms of said Agreement are in the best interests of lessee for the acquisition of such Equipment, and the governing body of Lessee designates and confirms the following persons to execute and deliver, and to witness (or attest), respectively, the Agreement and any related documents necessary to the consummation of the transactions contemplated by the Agreement. RESOLVED, the acquisition of the Equipment, under the terms and conditions provided for in the Agreement, is necessary, convenient, in the furtherance of, and will at all times be used in connection with, the Lessee's governmental and proprietary purposes and functions (except to the extent that subleasing of the Equipment is permitted under terms of the Agreement) and are in the best interests of the lessee, and no portion of the Equipment will be used directly or indirectly in any trade or business carried on by any person other than a governmental unit of the State on a basis different from the general public. RESOLVED, the Lessee covenants that it will perform all acts within its power which are or may be necessary to insure the maintenance of its legal status as being a duly organized and existing entity under the laws of the State, which status is the basis for the interest portion of the Rental Payments coming due under the Agreement to at all times remain exempt from federal income taxation under the laws and regulations of the United States of America as presently enacted and construed or as hereafter amended. �ory)�S � (-�2✓Lo��Se (Name of Party to Execute Municipal I— & Option Agreement) caoVictrzo- �•��t �l2 (Name of Party to Attest or Witness Municipal Lease & Option Agrternart) Gimh'�QS � (�.enou2S� (Name of Parry to sign Acceptance Certificate) (Title) et L'-X 0�44te- (Title) Full Force and Effect. The undersigned further certifies that the above resolution has not been pgaled or amended and remains in full force and effect and further certifies that the above and foregoing Agreement is the same as presented at said eeting of the governingpody of Lessee. rd Secretary/Clerk (SEAL) Twf t 4 4a a" 78-495 CALLE TAMPICO — LA QUINTA, CALIFORNIA 92253 - (619) 777-7000 FAX (619) 777-7101 EXHIBIT B Municipal Services Group, Inc. 5125 South Kipling Parkway Suite 300 Littleton, Colorado 80127 Ladies and Gentlemen: With respect to that certain Master Municipal Lease and Option Agreement ("the Agreement") by and between Municipal Services Group, Inc. ("Lessor") and City of La Quinta ("Lessee") I believe that (1) the Lessee is a state of political subdivision thereof within the meaning of Section 103 of the Internal Revenue Code of 1986, as amended; (2) the execution, delivery and performance by the Lessee of the Lease has been duly authorized by all necessary action on the part of the Lessee; (3) the agreement is a legal, valid and binding obligation of Lessee, enforceable in accordance with its terms. To the extent lawful, in the event the Lessor obtains a judgment against Lessee in money damages, as a result of an event of default under the Agreement, Lessee will be obligated to pay such judgment. Sincerely, Dawn C. Honeywell City Attorney, City of La Quinta MAILING ADDRESS - P.O. BOX 1504 - LA QUINTA, CALIFORNIA 92253 4111 • Agreement No. 1126 CERTIFICATE AS TO ARBPIRAGE 1, the undersigned officer of City of la Quinta (the "Lessee'D being the person duly charged, with others, with responsibility of issuing the Lessee's obligation in the form of that certain agreement entitled "Municipal Lease and Option Agreement' (the "AgreementD numbered 1126, and issued said date HEREBY CERTIFY that: 1. The Agreement was issued by the lessee under and pursuant to existing law to finance the acquisition of the certain Equipment described therein. 2. Pursuant to the Agreement, the Lessee is entitled to receive said Equipment in consideration for the obligation of the Lessee under the Agreement. Said Equipment will be used in furtherance of the public purposes of the Lessee. The Lessee does not intend to sell said Equipment or said Agreement or to otherwise dispose of said Equipment during the tern of the Agreement. The Lessee will not receive any monies, funds, or other "proceeds" as a result of the Agreement. 3. The Lessee expects to make payments under the Agreement from its general funds on the basis of annual appropriations in amounts equal to the required payments under the Agreement. The remaining general funds of the Lessee are not reasonably expected to be used to make such payments and no other monies are pledged to the Agreement or reasonably expected to be used to pay principal and interest on the Agreement. 4. The Lessee has not received notice that its Certificate may not be relied upon with respect to its own issues nor has it been advised that any adverse action by the Commissioner of Internal Revenue is contemplated. S. The Lessee certifies that the Property (as defined in the Agreement) is or will be owned and operated by the Lessee and will not be used in the trade or business of any person on a basis different from the general public. To the best of my knowledge, information and belief the expectations herein expressed are reasonable and there are no facts, estimates or circumstances other than those expressed herein that would materially affect the expectations herein expressed. IN WITNESS WHEREOF, I have hereunto set my hand this /tV 6�6 day of In tr(2-h 19 LESSEE: '//C�[ityofIa _Quuinta12-,12 By Tide: fto Agreement No. I M aI•u: 1E DESCRIPTION OF EQUIPMENT' The Equipment which is the subject of the Individual Payment Schedule No. 1 to the Master Municipal lease and Option Agreement is as follows: One (1) 1995 International Model 4700 Dump Truck Together with all additions, accessions and replacements thereto. Lessee hereby certifies that the description of the Equipment set forth above constitutes an accurate description of the "Equipment', as defined in the attached Master Municipal Lease and Option Agreement applicable Individual Payment Schedule. LESSEE: {Chit, of La Quintaa By Tide: Address of Equipment Upon Delivery and Acceptance: I E-10ia igVs-;C� LA 9iA i &T-o CA 992 t 3 iv EXHIBIT E SCHEDULE OF PAYMENTS DATED DATE: MARCH 2, 1995 CITY OF LA QUINTA PHI PAYMENT PAYMENT PRINCIPAL INTEREST tk DATE -------------------------------- AMOUNT --------------------------------- PORTION PORTION 1 15 - Jul-95 8,66,1.23 7,982.11 682.12 2 15 - Ju1-96 8,664.23 7,446.10 1,218.13 3 15 - Ju1-97 8,664.23 8,032.10 632.13 TOTAL 25,992.70 23,460.32 2,532.38 LE SEE: CITYTY OI� BY: 1"IT LE: T PAGE 1 OF 2 PURCHASE PRICE 15,896.08 8,177.66 (0.00) DUE1BIT E SCHEDULE OF PAYMFIJ75 Base Interest Rate: 7.87% U. S. Treasury Note Yield: 7.70% U.S. Treasury Note Index Percent 102.21% Adjusted Base Interest Rare: Dated Date: March 2, 1995 Page 2 of 2 Provided all documents have been returned in a form acceptable to Lessor within thirty (30) days of the Dated Date (the "Period"), then the Base Interest Rate can remain in effect during the Period. In the event all documents have not been returned within the Period, in a form acceptable to Lessor, and/or if the U. S. Treasury Note Yield for a maturity comparable to the Lease Term increases significantly, the Lessor reserves the right to adjust and determine a new Base Interest Rate (the "Adjusted Base Interest Rate") pursuant to the provisions hereof. The Adjusted Base Interest Rate shall be determined by multiplying the U. S. Treasury Note Yield for a maturity comparable to the Lease Term (as of the business day immediately preceding the receipt of the documents by the Lessor) by the U. S. Treasury Note Index Percent. Such Adjusted Base Interest Rate shall be the applicable interest rate for the principal balance of the Equipment which is the subject of this Individual Payment Schedule, and the Lessor and the Lessee shall execute a revised Exhibit E to this Individual Payment Schedule to acknowledge such change. LESSEE: Ciiry of la Quinta By: IX44� - Title: Agreement No. 1126 I XIRBI I.W*x 7Y:t:rM' Mn' 1111 Y4 The undersigned, as Lessee under the Master Municipal Lease and Option Agreement (the "Agreement') numbered 1126, with Municipal Services Group, Inc. C'Irsso29, acknowledges receipt in good condi¢'on of the_E9uipment described in the Agreement or in the applicable Individual Payment Schedule attached thereto this /0 day of / 2e2e O j t /qg5 and certifies that Lessor has fully and satisfactorily performed all of its covenants and obligations required under the Agreement. ]essee confirms that it will commence payments in accordance with Article 6 of the Agreement or the provisions of the applicable Individual Payment Schedule. The undersigned officer of the Lessee hereby reaffirms in all respects the Certificate as to Arbitrage attached as Exhibit C to the Agreement, and represents that, to the best of his or her knowledge, information and belief, the expectations therein expressed were reasonable as of the Accrwd Date on which they were made, and are reasonable as of this date, and that there were, and are as of this date, no facts, estimates or circumstances other than those expressed therein that would materially affect the expectations expressed therein. LESS ity of la Quinm By: t�sll/J� R Tide A Agreement No. I E)UI]BTT G TO: Municipal Services Group, Inc. 5125 South Ripling Parkway Suite 300 Littleton, Colorado, 80127 FROM: City of la Quinta P. O. Box 1504 la Quinta, California 92253 SUWECr: INSURANCE COVERAGE REQUIREMENTS 1. In accordance with Section 8.03 of the Master Municipal lease and Option Agreement No. 1126, we have instructed the insurance agent named below (please fill in name, address, and telephone number) Zv�s�rane� Q.u�.11or•��..� emu( (�t2sHr4-, 0"2-Q gaalDa to issue: a. All Risk Physical Damage Insurance on the leased Equipment of Unit thereof (as defined in the Agreement) evidenced by a Certificate of Insurance and Long Form Iris Parable Clause naming 1e or "and/or its assijtne lass Pavae. Public Liability Insurance evidence by a Certificate of Insurance naming 'lessor and/or its assigns" as an Additional Insured. Minimum Coverage Required: $500,000.00 per person $500,000.00 aggregate bodily injury liability $300,000.00 property damage liability LOW 2. Pursuant to Section 8.03 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. 3. Proof of insurance coverage will be provided to Lessor prior to the time that the Equipment or Unit thereof is delivered to us. LESSEE: City of La Quinta By: Tide: Plm attach the Insurance Certificate to this Exhibit trip BANK EUGIBILFIY CERTIFICATE THIS BANK ELIGIBILITY CERTIFICATE is entered into this /O AZ. mar day of _ a re h 1995 and executed by City of la Quinta, as lessee, supplementing and adding to tease and Option Agreement No. 1126. WITNESSETH: WHEREAS, the Lessor and the Lessee have entered into a Municipal Lease and Option Agreement No. 1126; and WHEREAS, the Lessee desires to supplement the Agreement; NOW THEREFORE, in consideration of the premises hereinafter contained, the Lessee hereby certifies that: The Lessee has not issued or effected the issuance of, and reasonably anticipates that it shall not issue or effect the issuance of more than Ten Million Dollars ($10,000,000.00) of tax-exempt obligations during the 1995 calendar year, and hereby designates the lease of the Equipment to which this certificate pertains as a "qualified tax-exempt obligation," as defined by Section 265 (b) (3) of the Internal Revenue Code of 1986, as amended. In witness whereof, the Lessee has caused this Supplement to the Agreement to be executed by its respective officers thereunto duly authorized, all as of the date and year first above written. LESSEE: City of La Quinm Tide: age M,M SMALL ISSUER EXEMPTION CERTIFICATE THIS SMALL ISSUER EXEMPTION CERTIFICATE is entered into this /©__� day of NC ✓ \ . 1995 and executed by City of 1a Quinta, as lessee, supplementing and adding to Lease and Option Agreement No. 1126. WITNESSETT-I: WHEREAS, the lessor and the Lessee have entered into a Municipal base and Option Agreement No. 1126; and WHEREAS, the Lessee desires to supplement the Agreement; NOW THEREFORE, in consideration of the premises hereinafter contained, the parties hereto agree to supplement the Agreement as follows: The Lessee has not issued or effected the issuance of, and reasonably anticipates that it shall not issue or effect the issuance of, more than Five Million Dollars ($5,000,000.00) of tax-exempt bonds (other than private activity bonds) (such terms being within the meaning of Section 148 (f)(4)(C) of the Internal Revenue Code of 1986, as amended), during the 1995 calendar year. In witness whereof, the lessee has caused this Supplement to the Agreement to be executed by its respective officers [hereunto duly authorized, all as of the date and year first above written. LESSEE:: City of la Quints Arl Title: ar t_j/ J