HomeMy WebLinkAbout04-19-2016 Item 10 Fleet Replacement Acceleration
Meeting Date: 4/19/2016
FROM: Garret Olson, Fire Chief
Daryl Grigsby, Public Works Director
Prepared By: Jeremy Schmidt, Fire Mechanic
Julie Cox, Administrative Analyst
Ryan Betz, Administrative Analyst
Isaac Shuck, Fleet Supervisor
Tim Bochum, Public Works Deputy Director
SUBJECT: FLEET REPLACEMENT ACCELERATION
RECOMMENDATION
1. Approve acceleration of three vehicle replacements from FY 2016-17 to FY 2015-16 due
to the extended period of time between order and receipt; and
2. Approve the lease purchase of one 2016 Pierce Arrow XT PUC 75’ Quint Aerial Fire
Apparatus in the amount of $894,650; and
3. Approve the lease purchase of one 2016 International/Tymco Street Sweeper Truck in the
amount of $246,817.60; and
4. Authorize the City Manager, Finance Director and City Attorney to execute all related
documents on behalf of the city to execute a five year agreement with PNC Equipment
Finance to accomplish these two lease purchases (Attachment G); and
5. Authorize the Finance Director to execute the purchase orders in the amounts noted and
associated with the fleet replacements described in Attachment A; and
6. Approve revenue appropriation of $36,096 from the Fleet Sale of Surplus Property fund
and expenditures of $36,096 for Command Vehicle CIP ($16,247) and Ambulance/Squad
CIP ($19,849) for new equipment requirements for Ambulance/Squad and Command
Vehicle; and
7. Authorize the surplus designation of Fleet Asset No. 9403, a 1991 Pierce 75’ Quint, Fleet
asset 0021, a 2000 Chevrolet Tahoe, and Fleet Asset No. 0317, a 1998 Ford E350
Ambulance, Fleet Asset No. 0206 2001 Freightliner/Tymco Sweeper Truck by sale,
auction, trade-in or other method in accordance with the City’s policies and procedures as
prescribed in the Financial Management Manual Section 405-L and 480.
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REPORT-IN-BRIEF
Three specialized vehicles are rapidly approaching end of useful life. As a result of the extended
time required to procure such specialized vehicles, staff recommend the accelerated replacement
of the following: Fire Aerial Quintuple (“Quint”) Apparatus, Fire Command Vehicle and Public
Works Street Sweeper. A Quint combination pumper-aerial serves a dual purpose, both as a fire
pumper and an aerial apparatus. By definition, this includes an aerial ladder greater than 50 feet,
minimum water tank of 300 gallons, fire pump capable of 750 gallons per minute, and ability to
incorporate specific inventories of ancillary equipment including hose and ground ladders.
These three vehicles were each approved for replacement FY 2016-17. Additionally, the Fire
Squad/Ambulance was approved for replacement in FY 2015-16. New ambulance crash
standards, however, require a more expensive gurney system and an increased cost of $19,849.
The Fire Command vehicle requires a more expensive radio system because the old system is no
longer available. The new system increases by cost by $16,247. Staff is proposing the use of
Fleet Sale of Surplus Property revenue from FY 2015 -16 to pay for the additional costs
associated with these vehicle acquisitions.
This item was removed from the March 15, 2016 agenda so that staff could analyze financing
documents provided by the lender that were delivered that day. This review has occurred and
staff is now recommending approval of the item.
DISCUSSION
Background
The build time for these vehicles ranges from approximately six to twelve months due to their
complexity. Given this long build time and the condition of the current fleet, staff is requesting
this replacement acceleration to ensure continuity of service and decreased maintenance
expenses to keep aged apparatus in service. Emergency vehicles are a vital part of the service
delivery for the San Luis Obispo City Fire Department. The Fire Department responds to over
5,000 emergency service calls annually. A Fire Apparatus Quint, Squad Ambulance and
Command Vehicle, were all approved to be replaced as part of the 2015-17 Financial Plan in
Fiscal Year 2016-17. Fire and Fleet operations developed a Fire Quint Apparatus, Squad and
Command Vehicle specification committee that took into account the unique features of our
community and identified the overall best fit for City’s fire vehicles. The new Fire Quint
Apparatus will replace a 23 year-old unit and the Squad will replace City an 18 year-old unit.
The Command vehicle will replace a 16 year-old unit. The new vehicles will provide a higher
level of service while reducing costs and staff time for maintenance. The new Quint will also
meet highest emission standards.
The replacement of the 2001 Freightliner/Tymco Street Sweeper Truck, used daily by the Streets
Maintenance staff, was approved as part of the 2015-17 Financial Plan in Fiscal Year 2016-17,
this vehicle is now fourteen years old and is well beyond its useful life replacement target of
eight years for sweeper vehicles. This truck is used primarily for critical City streets sweeping
maintenance and paving operations cleanup. Additionally, it is used to assist the Police
Department with vehicle accident cleanup, cleaning the City Corporation Yard’s wash bay area,
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and assisting the Utilities Department in cleanup after water main breaks and/or storm drain
cleaning. Similar to the fire apparatus discussed above, the sweeper lead time for vehicle
production is six to twelve months. Ordering the vehicle now allows for delivery in the fiscal
year that is planned for in the Financial Plan.
Fire Apparatus Quint – Sole Source Purchase Recommended
Following extensive analysis, Staff is seeking the authorization to purchase a 2016 Pierce 75’
Quint Aerial PUC Pumper. Pierce Fire apparatus has been a dependable platform for emergency
response in the City for more than a quarter century.
Why a Sole Source Purchase of the Quint is Recommended
Staff recommends a sole source purchase award to South Coast Fire Equipment in the amount of
$894,650.29 for the purchase of a 2016 Pierce Arrow XT Quint 75 Foot Aerial PUC Fire
Pumper. (Attachment B) City purchasing guidelines allow for sole source when supplies or
equipment have been uniformly adopted in use by the City or otherwise standardized. The Pierce
Fire Quint Aerial Pumper has been the standard aerial apparatus for the City of San Luis Obispo
for the last quarter century. While there are other vendors that could provide aerial apparatus,
staff is recommending Pierce due to a variety of issues, including; equipment standardization and
familiarity by both the fire engineer and the fire mechanic, production time reduction resulting
from working experience the City has established with Pierce’s manufacturing staff, and the
benefits of utilizing local vehicle vendors like California-based South Coast Fire Equipment.
South Coast Fire Equipment is providing the purchasing quote for aerial apparatus at the base
price reflective of a nationally utilized cooperative purchasing agreement. Used as a pricing
standard throughout the fire service, this master contract is commonly known as the HGAC, or
Houston Galveston Area Council cooperative purchasing agreement. While the City is not
purchasing through the HGAC, the City’s price for this apparatus is the same of this cooperative
purchasing agreement.
The Fire Department has a significant equipment and training investment with maintaining
Pierce manufactured apparatus. Fire Fleet already has an inventory of spare parts, filters and
maintenance items specific to the Pierce fire aerial apparatus platform. This inventory would be
costly to retrofit to accommodate another make of engine. Additionally, the Fire Department Fire
Vehicle Mechanic is specially trained and equipped to provide maintenance to Pierce
manufactured fire apparatus. All current front-line heavy duty fire apparatus is manufactured by
Pierce. Continuing with Pierce heavy duty apparatus maximizes the training and specialty tools
already provided to staff, thus controlling costs. Finally, the cost for the Pierce Aerial Apparatus
is comparable to that of other vendors.
Squad Rescue Ambulance - Cooperative Purchasing
The City’s Financial Management Manual, Section 405-I page 14, recommends fleet purchases
using either a State cooperative purchasing contract or “piggyback” agreements with local
agencies.
All Fleet purchases such as Police patrol vehicles, general purpose fire trucks, sedans
station wagons, passenger vans, light to heavy trucks, utility vehicles, and construction
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equipment should generally be acquired new through State of California Multiple Award
Schedule (CMAS) contracts. Specialized units not generally available through CMA
should generally be acquired new through “piggyback” purchases, where other local
agencies have conducted competitive procurements and made those contracts available
to the City.
CMAS contracts that leverage prices by other agencies provide substantial cash discounts for the
City when making these procurements as well as expedite the purchasing process. Having the
capability to make a purchase through an established purchasing agreement, as opposed to an
independent purchase, will provide the City additional savings to be utilized to purchase
additional replacement equipment. Staff conducted bids from the National Joint Purchasing
Alliance (NJPA), the HGACBuy Cooperative Purchasing Program (HGACBuy Contract No.
SW04-14 and local vendors Perry Ford and Alfano Motors per City’s Financial Management
Manual Section 405-I, page 14 line 3. This policy states:
3. Contact any local dealers that might have been potential bidders to ensure that the
cooperative contract price is a good value and prudent alternative to advertising for
bids.
a. Use local dealer within the city limits if they can provide the same brand, model and
configuration of item(s) identified in cooperative purchase agreement(s) at or below
the cooperative purchasing net cost within the same terms and conditions.
Per the City’s purchasing policy, staff is seeking Council approval to purchase one Squad Rescue
Ambulance for $199,849. Staff has concluded that the 2016 Ford F550 4WD with Leader
Industries ambulance package would make the best fit for the Fire Department’s Squad Rescue
Ambulance needs (Attachment C). The vehicle will be outfitted through Leader Ambulance, a
well-known and well reputed fire equipment builder and repair facility located in Southern
California. The price quote benefits from the cost competitive bid process obtained by the City of
Downieville Fire Department. The chassis for the vehicle will be purchased through Perry Ford,
a local vendor, and transported to Leader for production.
Squad Chassis
Perry Ford was the lowest bid for the Squad Chassis. Staff recommends approval of using Perry
Ford for this purchase. (Attachment E)
Command Vehicle
Per the City’s purchasing policy, staff is seeking Council approval to purchase one new Fire
Battalion Chief (BC) Command vehicle currently budgeted and approved for replacement as part
of the 2015-17 Financial Plan in Fiscal Year 2016-17. Staff has concluded after an extensive
analysis that the 2016 Chevrolet Suburban 4WD 4-door, 1500 series would make the best fit for
the Fire Departments’ command vehicle requirements. Pursuant to City purchasing guidelines,
staff explored the use of a multi-year cooperative purchasing agreement with the National Joint
Powers Alliance (NJPA), contract #102811 (expires 1/17/17), to purchase one Chevrolet
Suburban 4WD 4-door. This resulted in a quote totaling $49,456.04 through its approved
Chevrolet dealer, National Auto Fleet Group. Per City purchasing guidelines, staff contacted the
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local dealer, Alfano Motors of San Luis Obispo, for comparative pricing and received a quote
totaling $46,961.75. Alfano Motors was the lowest bid for the Command Vehicle Chassis. Staff
recommends approval of using Alfano Motors for this purchase. (Attachment D) An additional
$16,247 is also requested as the radio in the replacement Command Vehicle is no longer
available and a new model radio kit ($16,247) for the vehicle is required.
Sweeper Truck
Pursuant to City purchasing guidelines, staff explored use of a multi -year cooperative purchasing
agreement with HGACBuy Contract No. SW04-14, effective through April 30, 2016, to purchase
a sweeper truck that met City specifications. This resulted in a quote totaling $246,817.80
through its approved dealer, Tymco Inc. Per City purchasing guidelines, staff searched for a local
dealer for comparison pricing and found no local sweeper truck dealers. (Attachment F)
FISCAL IMPACT
Lease Purchase
The City has strategically used lease options as ways to reduce significant variations in the costs
of replacing vehicles or other specialty equipment. Due to the high cost of the fire engine and
sweeper, staff proposed and Council approved debt financing of these two vehicles in the 2015-
17 Financial Plan to stabilize the annual costs needed to be paid from the Fleet Fund. Staff is
seeking the authorization to execute a lease purchase agreement with PNC Equipment Finance
(Attachment G), - for the acquisition of the new Fire Apparatus Quint and the Tymco Street
Sweeper. These purchases are budgeted and approved for replacement as part of the 2016-17
Financial Plan. In the 2015-17 Financial Plan, pages G7 and G10 provide estimates of the
estimated debt financing to acquire these vehicles. The proposed annual lease payments are
within the budgeted amounts in the financial plan and the proposed financing was reviewed by
PFM, the City’s independent financial advisor.
Funding for the replacement apparatus listed in the table below was approved in the 2015-17
Financial Plan. Since the approval of the 2015-17 Financial Plan, new standard equipment
requirements have occurred such as gurney and radio kit for the Ambulance Van Package and
the Command Vehicle. The ambulance budget expected that the current patient gurney could be
reused with the new vehicle.
The existing gurney for the Ambulance does not meet the triple K Ambulance Crash Standards
and requires purchase of a new gurney $16,169 plus $3,680 for increased cost for required
equipment, totaling $19,849. The radio in the replacement Command Vehicle is no longer
available and a new model radio kit ($16,247) for the vehicle is required. (Attachment H) The
current budgets for these vehicles are not sufficient to cover these additional costs. Staff
recommends approval of $36,096 from Fleet Sale of Surplus Property revenue fund to cover the
additional costs.
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Department
Adopted
Budget Fiscal Year
New
Equipment
Requirements Total Cost
Fire
Ambulance Package Van 180,000 15-16 19,849 199,849
Aerial Fleet Apparatus 900,000 16-17 n/a 900,000
Command Vehicle
(Emergency Response
SUV) 99,400 16-17 16,247 115,647
Public Works
HD Truck Sweeper Unit 266,600 16-17 n/a 266,600
Lease Purchase Terms
Staff has worked with private lenders and the City’s Financial Advisor to review financing offers
from various entities. Staff is recommending that we enter into a lease agreement with PNC
Equipment Finance, LLC to provide financing of the vehicles. PNC’s terms were the same or
better than other lenders and final annual interest rate for the lease is set at 1.70%.
The following table reflects the annual payments for the lease agreement. The Financial Plan
Debt Services estimates anticipated up to 4% for the APR for this lease and because the City
negotiated a substantially less interest rate, the financial plan covers the proposed debt services
costs with savings available to cover other vehicles purchases.
PNC Equipment Financial
Amount Borrowed: $1,141,468.09
Annual Payments: (1) $240,067.42
(2) $240,067.42
(3) $240,067.42
(4) $240,067.42
(5) $240,067.42
Total Amount Paid: $1,200,337.10
Annual Interest Rate: 1.70%
The adopted Financial Plan anticipated that a partial payment for this lease would be necessary
in FY 2016-17. The first payment for the lease will be $240,067.42 and due on April 28, 2017 or
later if the leased equipment is not delivered to the City. The change to the payment plan in the
Debt Service Fund will be updated as part of the 2016-17 Budget Supplement.
ALTERNATIVES
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Deny Funding Transfer and Purchase. The City Council could choose to deny or defer the
Quint 75’ Aerial Fire Apparatus, Command and Squad Rescue and Street Sweeper vehicles.
Staff does not recommend this option as the replacements were approved as part of the 2015-17
Financial Plan. The vehicles above have met its useful target life in both years and mileage.
Denying or deferring the purchase could result in costly maintenance and repairs due to aging
vehicles.
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Attachment A Purchase Orders
Authorize the Finance and Information Technology Director to execute the purchase orders listed
below:
1. a purchase order to South Coast Fire Equipment in the amount of $894,650.29 for the
purchase of one new 2016 Pierce Arrow XT PUC 75’ Quint Aerial Fire Apparatus and
2. a purchase order to International/Tymco in the amount of $246,817.80 for the purchase of
one new 2016 Sweeper Truck and
3. a purchase order to Alfano Motors in the amount of $46,961.75 for the purchase of one
new 2016 Chevrolet Suburban 1500 Command Vehicle Chassis and
4. a purchase order to Perry Ford in the amount of $55,118.88 for the purchase of one new
2016 Ford F550 Ambulance Chassis and
5. a purchase order to Leader Emergency Vehicles in the amount of $144,730.09 for the
purchase build of one new Ambulance/Squad and
6. a purchase order to Motorola Solutions in the amount of $16,247.52 for the purchase of a
radio kit for the Command Vehicle Chassis
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10941 Weaver Avenue
South El Monte, CA 91733
Kevin Oberthier, Factory Direct Sales
Mobile: (559) 761-9382
Fax: (559) 276-3235
2-Feb-2016
TERMS SHIP VIA
COD Ground
QUANTITY EACH EXTENDED AMOUNT
1 $133,998.00 133,998.00$
Sub-Total 133,998.00$ 133,998.00$
1 Sales Tax 8.00%10,719.84$ 10,719.84$
7 CA Tire Fee $1.75 (Per Tire)12.25$ 12.25$
1 DMV Fee's
TOTAL QUOTED AMOUNT 144,730.09$ 144,730.09$
Customer Approval:Payment: (Please check one)
Leasing
Company Check
Wire Transfer
Quotation is valid for 60 days
Stryker power cot, Electric Modular door locks,
Features. "E" Start, Unlock Switch, Tinted Windows, Cot Stop.
Safety Net, Console, LED Lighting, Zico Bottle Holder.Pre-set Reg,
Chassis Will be Provided by SLOFD.
FOB
South El Monte, CA
QUOTATION
Signature
San Luis Obispo F.D.
2160 Santa Barbara Ave
San Luis Obispo , CA. 93401
THANK YOU FOR YOUR BUSINESS
Pricing
Date
Delivery 120-140 Days after receipt of chassis
DESCRIPTION
Purchaser agrees to defend, indemnify and hold Halcore Group Inc., dba Leader Industries, harmless from any claims, costs (including actual
attorney's fees), damages and liabilities caused in whole or impart by any alteration or modification of, or change
TERMS: All Vehicle Sales Are C.O.D. Titles to be Processed Upon Receipt of Payment in Full.
2016 Ford F-550 Type-1 4x4 Leader Conversion
Inverter / Charger, "H" Tank set-up, Hidden Door Switch,
Liquid Spring system, Paint Ford Red, Rear Chevrons, lettering
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Tax Exempt Lease Purchase **updated**
SALES ORGANIZATION: South Coast Fire - Jon Contact information:
LESSEE: City San Luis Obispo Monday, March 28, 2016
TYPE OF EQUIPMENT: Pierce 75' Arrow XT Kim Simon
EQUIPMENT COST:
$894,650.29 including discounts and
sales tax plus street sweeper
$246,817.60
Locator: B3-B230-05-07
CUSTOMER DOWNPAYMENT: $0.00 155 East Broad St
TRADE-IN: $0.00 Columbus, OH 43215
DELIVERY TIME: Std delivery P: (800) 820-9041, ext. 1
PAYMENT MODE: Annual In Arrears M: (614)-670-3994
FIRST PAYMENT DUE DATE: 1 Year After Lease Commencement Fax:(800)-678-0602
LEASE COMMENCEMENT DATE: Upon contract signing with Pierce Kim.simon@pnc.com
Term 5 years
Number of Payments 5 annual
Payment Amount $240,067.42
Interest rate 1.70%
NOTE: All lease documents must be fully executed within 14 days of the date of this proposal. Failure to receive completed documents may alter the final payment schedule due to
changes in rates and/or discounts. There will be a $250 fee if an escrow option is necessary.
PERFORMANCE BOND: To utilize the prepay program, a performance bond is required. Said performance bond shall be paid for directly to Pierce manufacturing or financed by PNC
Equipment Finance as part of the transaction
TYPE OF FINANCING: Tax-exempt Lease Purchase Agreement with a $1.00 buy out option at end of lease term. Said agreement shall be a net lease arrangement whereby lessee is
responsible for all costs of operation, maintenance, insurance, and taxes.
BANK QUALIFICATION: This proposal assumes that the lessee will not be issuing more than $10 million in tax-exempt debt this calendar year. Furthermore, it is assumed that the lessee
will designate this issue as a qualified tax-exempt obligation per the tax act of 1986.
LEGAL TITLE: Legal title to the equipment during the lease term shall vest in the lessee, with PNC Equipment Finance perfecting a first security interest
AUTHORIZED SIGNORS: The lessee's governing board shall provide PNC Equipment Finance with its resolution or ordinance authorizing this agreement and shall designate the
individual(s) to execute all necessary documents used therein.
LEGAL OPINION: The lessee's counsel shall furnish PNC Equipment Finance with an opinion covering this transaction and the documents used herein. This opinion shall be in a form and
substance satisfactory to PNC Equipment Finance.
VOLUNTEER FIRE DEPARTMENTS: If Lessee is a Volunteer Fire Department, a public hearing under the requirements of Section 147(f) of the Internal Revenue Code of 1986 shall be
conducted to authorize this transaction. It is recommended that a notice of the public hearing be published 10 to 14 days in advance of the public hearing.
This proposal will be valid for April 28, 2016 from the above date and is subject to final credit approval by PNC Equipment Finance and approval of the lease documents in PNC Equipment
Finance's sole discretion. To render a credit decision, lessee shall provide PNC Equipment Finance with their most recent two years' audited financial statements, copy of their most
recent interim financial statement, and current budget.
Accepted by:____________________________________ Proposal submitted by_____________________
10.g
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Quote Number:QU0000349962
Effective:02 FEB 2016
Effective To:27 MAY 2016
Bill-To:Ultimate Destination:
SAN LUIS OBISPO FIRE DEPARTMENT SAN LUIS OBISPO FIRE DEPARTMENT
2160 2160
SANTA BARBARA STREET SANTA BARBARA STREET
SAN LUIS OBISPO, CA 93401 SAN LUIS OBISPO, CA 93401
United States United States
Attention:Sales Contact:
Name:Jeremy Schmidt Name:Tammie Massirer
Email:jschmidt@slocity.org Email:Tammie.Massirer@motorolasolutions.com
Phone:805-781-7375 Phone:19166260493
Contract Number:LA COUNTY (CA)
Freight terms:FOB Destination
Payment terms:Net 30 Due
Item Quantity Nomenclature Description List price Your price Extended Price
1 3 M25KSS9PW1AN APX6500 VHF MID POWER $2,194.00 $1,645.50 $4,936.50
1a 3 G806BE ADD: ASTRO DIGITAL CAI
OPERATION
$515.00 $386.25 $1,158.75
1b 3 G442AJ ADD: O5 CONTROL HEAD $432.00 $324.00 $972.00
1c 3 G67BC ADD: REMOTE MOUNT MID POWER $297.00 $222.75 $668.25
1d 3 G398AU ENH: 3 YEAR REPAIR SERVICE
ADVANTAGE
$182.00 $182.00 $546.00
1e 3 GA00179AB ADD: NO REMOTE CABLE NEEDED ---
1f 6 W22BA ADD: PALM MICROPHONE $72.00 $54.00 $324.00
1g 3 G444AE ADD: APX CONTROL HEAD
SOFTWARE
---
1h 3 G89AC ADD: NO RF ANTENNA NEEDED ---
1i 6 G831AD ADD: SPKR 15W WATER RESISTANT $60.00 $45.00 $270.00
1j 3 G48BD ENH: CONVENTIONAL OPERATION
APX6500
$500.00 $375.00 $1,125.00
1k 3 GA00092AC ADD: DUAL-CONTRL HD HARDWARE $570.00 $427.50 $1,282.50
2 1 M25SSS9PW1AN APX6500 UHF R2 MID POWER $2,194.00 $1,645.50 $1,645.50
2a 1 G806BE ADD: ASTRO DIGITAL CAI
OPERATION
$515.00 $386.25 $386.25
2b 1 G442AJ ADD: O5 CONTROL HEAD $432.00 $324.00 $324.00
2c 1 G67BC ADD: REMOTE MOUNT MID POWER $297.00 $222.75 $222.75
2d 1 G398AU ENH: 3 YEAR REPAIR SERVICE
ADVANTAGE
$182.00 $182.00 $182.00
2e 1 GA00179AB ADD: NO REMOTE CABLE NEEDED ---
2f 2 W22BA ADD: PALM MICROPHONE $72.00 $54.00 $108.00
2g 1 G444AE ADD: APX CONTROL HEAD
SOFTWARE
---
2h 1 G89AC ADD: NO RF ANTENNA NEEDED ---
2i 2 G831AD ADD: SPKR 15W WATER RESISTANT $60.00 $45.00 $90.00
2j 1 G48BD ENH: CONVENTIONAL OPERATION
APX6500
$500.00 $375.00 $375.00
2k 1 GA00092AC ADD: DUAL-CONTRL HD HARDWARE $570.00 $427.50 $427.50
Estimated Tax Amount $1,203.52
Total Quote in USD $16,247.52
10.h
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This pricing utilizes LA Contract Master Purchase Agreement MA-IS-1240419-2
PO Issued to Motorola Solutions Inc. must:
>Be a valid Purchase Order (PO)/Contract/Notice to Proceed on Company Letterhead. Note: Purchase Requisitions cannot be accepted
>Have a PO Number/Contract Number & Date
>Identify "Motorola Solutions Inc." as the Vendor
>Have Payment Terms or Contract Number
>Be issued in the Legal Entity's Name
>Include a Bill-To Address with a Contact Name and Phone Number
>Include a Ship-To Address with a Contact Name and Phone Number
>Include an Ultimate Address (only if different than the Ship-To)
>Be Greater than or Equal to the Value of the Order
>Be in a Non-Editable Format
>Identify Tax Exemption Status (where applicable)
>Include a Signature (as Required)
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E05
- 1 -
Master Lease-Purchase Agreement
Between
CITY OF SAN LUIS OBISPO AND PNC EQUIPMENT FINANCE, LLC
DOCUMENT INDEX
Master Lease-Purchase Agreement – Sign and provide title on the last page
Lease Schedule with Schedule A-1 – Sign and title
Vehicle Schedule Addendum –Sign and title
Escrow Agreement
o Exhibit 1 – General Investment Direction Letter
o Exhibit 2 – Escrow Agent Fees and Expenses
o Exhibit 3 – Requisition Request and Certificate of Acceptance
o Money Market Escrow Investment Letter- Please sign or contact Scott Miller at 614-849-
3402 with U.S Bank to select a different investment that meets your requirements.
Incumbency Certificate and Resolution– List your authorized signor(s) and title(s); have secretary
or appropriate trustee attest to the information and signature(s) provided by signing and printing
his/her name, title and date. The person who validates the signatures should not sign the
lease documents. The resolution must reflect the title(s) of the individual(s) who have
authorization to sign the documents.
Opinion of Counsel Letter – Enclosed is a template. Please ask your attorney to prepare on
his/her letterhead, and include all of the items in the template.
Title - The terms of your contract specify that the Lender be listed as the lienholder and hold the
original title during the term of the lease. In addition, we will need a copy of the front and back of
the MSO listing Oshkosh Capital, 995 Dalton Ave, Cincinnati, OH 45203 as first lien holder.
Insurance Request Form – Fill in your insurer’s information and sign. Please contact your
insurer, prior to delivery, to obtain a certificate of insurance. Please enclose the certificate with
the signed documentation or have the insurer fax the certificate directly to me.
Three Party Agreement – Sign and title.
Delivery & Acceptance Certificate – At point of delivery, fill out this form and fax it to me.
Please return the original via US Postal Service.
IRS FORM 8038-G – Sign, date, and title
Invoice for escrow payment – please send your check in the amount of $250.00, made
payable to PNC Equipment Finance, LLC.
Minutes of Governing Body (approving the purchase & finance of equipment) – Please return a
copy with the documents.
Sales Contract or Purchase Order - please provide a copy of the Sales Contract enter into
with Pierce Manufacturing or a copy of the Purchase Order issued to Pierce Manufacturing
Inc.
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E05
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MASTER LEASE – PURCHASE AGREEMENT
Dated as of April 28, 2016
This Master Lease-Purchase Agreement together with all addenda, riders and attachments
hereto, as the same may from time to time be amended, modified or supplemented (“Master Lease”) is
made and entered by and between PNC Equipment Finance, LLC (“Lessor”) and the Lessee identified
below (“Lessee”).
LESSEE: City of San Luis Obispo
1. LEASE OF EQUIPMENT. Subject to the terms and conditions of this Master Lease, Lessor agrees to
lease to Lessee, and Lessee agrees to lease from Lessor, all Equipment described in each Schedule
signed from time to time by Lessee and Lessor.
2. CERTAIN DEFINITIONS. All terms defined in the Lease are equally applicable to both the singular
and plural form of such terms. (a) “Schedule” means each Lease Schedule signed and delivered by
Lessee and Lessor, together with all addenda, riders, attachments, certificates and exhibits thereto, as
the same may from time to time be amended, modified or supplemented. Lessee and Lessor agree that
each Schedule (except as expressly provided in said Schedule) incorporates by reference all of the terms
and conditions of the Master Lease. (b) “Lease” means each Schedule and this Master Lease as
incorporated into said Schedule. (c) “Equipment” means the property described in each Schedule,
together with all attachments, additions, accessions, parts, repairs, improvements, replacements and
substitutions thereto. (d) “Lien” means any security interest, lien, mortgage, pledge, encumbrance,
judgment, execution, attachment, warrant, writ, levy, other judicial process or claim of any nature
whatsoever by or of any person.
3. LEASE TERM. The term of the lease of the Equipment described in each Lease (“Lease Term”)
commences on the first date any of such Equipment is accepted by Lessee pursuant to Section 5 hereof
and, unless earlier terminated as expressly provided in the Lease, continues until Lessee’s payment and
performance in full of all of Lessee’s obligations under the Lease.
4. RENT PAYMENTS.
4.1 For each Lease, Lessee agrees to pay to Lessor the rent payments in the amounts and at the
times as set forth in the Schedule A-1 attached to the Schedule (“Rent Payments”). A portion of each
Rent Payment is paid as and represents the payment of interest as set forth in the Schedule A-1. Rent
Payments will be payable for the Lease Term in U.S. dollars, without notice or demand at the office of
Lessor (or such other place as Lessor may designate from time to time in writing).
4.2 If Lessor receives any payment from Lessee after the due date, Lessee shall pay Lessor on
demand as a late charge five per cent (5%) of such overdue amount, limited, however, to the maximum
amount allowed by law.
4.3 EXCEPT AS SPECIFICALLY PROVIDED IN SECTION 6 HEREOF OR IN ANY WRITTEN
MODIFICATION TO THE LEASE SIGNED BY LESSOR, THE OBLIGATION TO PAY RENT PAYMENTS
UNDER EACH LEASE SHALL BE ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS AND SHALL
NOT BE SUBJECT TO ANY SETOFF, DEFENSE, COUNTERCLAIM, ABATEMENT OR RECOUPMENT
FOR ANY REASON WHATSOEVER.
5. DELIVERY; ACCEPTANCE; FUNDING CONDITIONS.
5.1 Lessee shall arrange for the transportation, delivery and installation of all Equipment to the
location specified in the Schedule (“Location”) by Equipment suppliers (“Suppliers”) selected by Lessee.
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E05
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Lessee shall pay all costs related thereto unless Lessor otherwise agrees to pay such costs as stated in
the Schedule.
5.2 Lessee shall accept Equipment as soon as it has been delivered and is operational. Lessee
shall evidence its acceptance of any Equipment by signing and delivering to Lessor the applicable
Schedule. If Lessee signs and delivers a Schedule and if all Funding Conditions have been satisfied in
full, then Lessor will pay or cause to be paid the costs of such Equipment as stated in the Schedule
(“Purchase Price”) to the applicable Supplier.
5.3 Lessor shall have no obligation to pay any Purchase Price unless all reasonable conditions
established by Lessor (“Funding Conditions”) have been satisfied, including, without limitation, the
following: (a) Lessee has signed and delivered the Schedule and its Schedule A-1; (b) no Event of Default
shall have occurred and be continuing; (c) no material adverse change shall have occurred in the Internal
Revenue Code of 1986, as amended, and the related regulations and rulings thereunder (collectively, the
“Code”); (d) no material adverse change shall have occurred in the financial condition of Lessee or any
Supplier; (e) the Equipment is reasonably satisfactory to Lessor and is free and clear of any Liens (except
Lessor’s Liens); (f) all representations of Lessee in the Lease remain true, accurate and complete; and (g)
Lessor has received all of the following documents, which shall be reasonably satisfactory, in form and
substance, to Lessor: (1) evidence of insurance coverage required by the Lease, (2) an opinion of
Lessee’s counsel; (3) reasonably detailed invoices for the Equipment; (4) Uniform Commercial Code
(UCC) financing statements; (5) copies of resolutions by Lessee’s governing body, duly authorizing the
Lease and incumbency certificates for the person(s) who will sign the Lease; (6) such documents and
certificates relating to the tax-exempt interest payable under the Lease (including, without limitation, IRS
Form 8038G or 8038GC) as Lessor may request; and (7) such other documents and information
previously identified by Lessor or otherwise reasonably requested by Lessor.
6. TERMINATION FOR GOVERNMENTAL NON-APPROPRIATIONS.
6.1 For each Lease, Lessee represents and warrants: that it has appropriated and budgeted
the necessary funds to make all Rent Payments required pursuant to such Lease for the remainder of the
fiscal year in which the Lease Term commences; and that it intends to make Rent Payments for the full
Lease Term as scheduled on the applicable Schedule A-1 so long as funds are appropriated in each
fiscal year by its governing body. Lessee reasonably believes that moneys in an amount sufficient to
make all Rent Payments can and will lawfully be appropriated and made available therefor. All Rent
Payments shall be payable out of the general funds of Lessee or out of other funds legally available
therefor. Lessor agrees that the Leases will not be general obligations of Lessee and that the Leases
shall not constitute pledges of either the full faith and credit of Lessee or the taxing power of Lessee.
6.2 If Lessee’s governing body fails to appropriate sufficient funds in any fiscal year for Rent
Payments or other payments due under a Lease and if other funds are not available for such payments,
then a “Non-Appropriation Event” shall be deemed to have occurred. If a Non-Appropriation Event
occurs, then: (a) Lessee shall give Lessor immediate notice of such Non-Appropriation Event and provide
written evidence of such failure by Lessee’s governing body; (b) on the Return Date, Lessee shall return
to Lessor all, but not less than all, of the Equipment covered by the affected Lease, at Lessee’s sole
expense, in accordance with Section 21 hereof; and (c) the affected Lease shall terminate on the Return
Date without penalty or expense to Lessee, provided, that Lessee shall pay all Rent Payments and other
amounts payable under the affected Lease for which funds shall have been appropriated or are otherwise
available, provided further, that Lessee shall pay month-to-month rent at the rate set forth in the affected
Lease for each month or part thereof that Lessee fails to return the Equipment under this Section 6.2.
“Return Date” means the last day of the fiscal year for which appropriations were made for the Rent
Payments due under a Lease.
7. NO WARRANTY BY LESSOR. The Equipment is sold “AS IS”. LESSEE ACKNOWLEDGES
THAT LESSOR DID NOT MANUFACTURE THE EQUIPMENT. LESSOR DOES NOT REPRESENT
THE MANUFACTURER, OWNER, OR DEALER, AND LESSEE SELECTED THE EQUIPMENT BASED
UPON LESSEE’S OWN JUDGMENT. LESSOR MAKES NO WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE
OR OTHERWISE OR AS TO THE EQUIPMENT’S VALUE, DESIGN, CONDITION, USE, CAPACITY OR
DURABILITY. LESSEE AGREES THAT REGARDLESS OF CAUSE, LESSOR IS NOT RESPONSIBLE
FOR, AND LESSEE WILL NOT MAKE ANY CLAIM AGAINST LESSOR FOR, ANY DAMAGES,
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E05
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WHETHER CONSEQUENTIAL, DIRECT, SPECIAL OR INDIRECT INCURRED BY LESSEE IN
CONNECTION WITH THE EQUIPMENT OR THIS MASTER LEASE – LEASE PURCHASE
AGREEMENT. NEITHER THE M ANUFACTURER, THE DEALER, NOR ANY SALESPERSON,
EMPLOYEE OR AGENT OF THE DEALER OR MANUFACTURER, IS LESSOR’S AGENT OR HAS
ANY AUTHORITY TO SPEAK FOR LESSOR OR TO BIND LESSOR IN ANY WAY. For and during the
Lease Term, Lessor hereby assigns to Lessee any manufacturer’s or Supplier’s product warranties,
express or implied, applicable to any Equipment and Lessor authorizes Lessee to obtain the customary
services furnished in connection with such warranties at Lessee’s sole expense. Lessee agrees that (a)
all Equipment will have been purchased by Lessor in accordance with Lessee’s specifications from
Suppliers selected by Lessee, (b) Lessor is not a manufacturer or dealer of any Equipment and has no
liability for the delivery or installation of any Equipment, (c) Lessor assumes no obligation with respect to
any manufacturer’s or Supplier’s product warranties or guaranties, (d) no manufacturer or Supplier or any
representative of said parties is an agent of Lessor, and (e) any warranty, representation, guaranty or
agreement made by any manufacturer or Supplier or any representative of said parties shall not be
binding upon Lessor.
8. TITLE; SECURITY INTEREST.
8.1 Upon Lessee’s acceptance of any Equipment under its Lease, title to the Equipment shall
vest in Lessee, subject to Lessor’s security interest therein and all of Lessor’s other rights under such
Lease including, without limitation, Sections 6, 20 and 21 hereof.
8.2 As collateral security for the Secured Obligations, Lessee hereby grants to Lessor a first
priority security interest in any and all of the Equipment (now existing or hereafter acquired) and any and
all proceeds thereof. Lessee agrees to execute and deliver to Lessor all necessary documents to
evidence and perfect such security interest, including, without limitation, Uniform Commercial Code
(UCC) financing statements and any amendments thereto.
8.3 “Secured Obligations” means Lessee’s obligations to pay all Rent Payments and all other
amounts due and payable under all present and future Leases and to perform and observe all covenants,
agreements and conditions (direct or indirect, absolute or contingent, due or to become due, or existing or
hereafter arising) of Lessee under all present and future Leases.
9. PERSONAL PROPERTY. All Equipment is and will remain personal property and will not be
deemed to be affixed or attached to real estate or any building thereon.
10. MAINTENANCE AND OPERATION. Lessee agrees it shall, at its sole expense: (a) repair and
maintain all Equipment in good condition and working order, in accordance with manufacturer’s
instructions, and supply and install all replacement parts or other devices when required to so maintain
the Equipment or when required by applicable law or regulation, which parts or devices shall
automatically become part of the Equipment; and (b) use and operate all Equipment in a careful manner
in the normal course of its operations and only for the purposes for which it was designed in accordance
with the manufacturer’s warranty requirements, and comply with all laws and regulations relating to the
Equipment. If any Equipment is customarily covered by a maintenance agreement, Lessee will furnish
Lessor with a maintenance agreement by a party reasonably satisfactory to Lessor. No maintenance or
other service for any Equipment will be provided by Lessor. Lessee will not make any alterations,
additions or improvements (“Improvements”) to any Equipment without Lessor’s prior written consent
unless the Improvements may be readily removed without damage to the operation, value or utility of
such Equipment, but any such Improvements not removed prior to the termination of the applicable Lease
shall automatically become part of the Equipment.
11. LOCATION; INSPECTION. Equipment will not be removed from, or if Equipment is rolling stock its
permanent base will not be changed from, the Location without Lessor’s prior written consent which will
not be unreasonably withheld. Upon reasonable notice to Lessee, Lessor may enter the Location or
elsewhere during normal business hours to inspect the Equipment.
12. LIENS, SUBLEASES AND TAXES.
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12.1 Lessee shall keep all Equipment free and clear of all Liens except those Liens created under
its Lease. Lessee shall not sublet or lend any Equipment or permit it to be used by anyone other than
Lessee or Lessee’s employees.
12.2 Lessee shall pay when due all Taxes which may now or hereafter be imposed upon any
Equipment or its ownership, leasing, rental, sale, purchase, possession or use, upon any Lease or upon
any Rent Payments or any other payments due under any Lease. If Lessee fails to pay such Taxes when
due, Lessor shall have the right, but not the obligation, to pay such Taxes. If Lessor pays any such
Taxes, then Lessee shall, upon demand, immediately reimburse Lessor therefor. “Taxes” means present
and future taxes, levies, duties, assessments or other governmental charges that are not based on the
net income of Lessor, whether they are assessed to or payable by Lessee or Lessor, including, without
limitation (a) sales, use, excise, licensing, registration, titling, gross receipts, stamp and personal property
taxes, and (b) interest, penalties or fines on any of the foregoing.
13. RISK OF LOSS.
13.1 Lessee bears the entire risk of loss, theft, damage or destruction of any Equipment in whole
or in part from any reason whatsoever (“Casualty Loss”). No Casualty Loss to any Equipment shall
relieve Lessee from the obligation to make any Rent Payments or to perform any other obligation under
any Lease. Proceeds of any insurance recovery will be applied to Lessee’s obligations under this Section
13.
13.2 If a Casualty Loss occurs to any Equipment, Lessee shall immediately notify Lessor of the
same and Lessee shall, unless otherwise directed by Lessor, immediately repair the same.
13.3 If Lessor determines that any item of Equipment has suffered a Casualty Loss beyond repair
(“Lost Equipment”), then Lessee shall either: (a) immediately replace the Lost Equipment with similar
equipment in good repair, condition and working order free and clear of any Liens (except Lessor’s Liens)
and deliver to Lessor a bill of sale covering the replacement equipment, in which event such replacement
equipment shall automatically be Equipment under the applicable Lease; or (b) on the next scheduled
Rent Payment date, pay Lessor (i) all amounts owed by Lessee under the applicable Lease, including the
Rent Payment due on such date plus (ii) an amount equal to the applicable Termination Value set forth in
the Payment Schedule to the applicable Lease. If Lessee is making such payment with respect to less
than all of the Equipment under a Lease, then Lessor will provide Lessee with the pro rata amount of the
Rent Payment and Termination Value to be paid by Lessee with respect to the Lost Equipment.
13.4 Lessee shall bear the risk of loss for, shall pay directly, and shall defend against any and all
claims, liabilities, proceedings, actions, expenses (including reasonable attorney’s fees), damages or
losses arising under or related to any Equipment, including, but not limited to, the possession, ownership,
lease, use or operation thereof. These obligations of Lessee shall survive any expiration or termination of
any Lease. Lessee shall not bear the risk of loss of, nor pay for, any claims, liabilities, proceedings,
actions, expenses (including attorney’s fees), damages or losses which arise directly from events
occurring after any Equipment has been returned by Lessee to Lessor in accordance with the terms of the
applicable Lease or which arise directly from the gross negligence or willful misconduct of Lessor.
14. INSURANCE.
14.1 (a) Lessee at its sole expense shall at all times keep all Equipment insured against all risks
of loss or damage from every cause whatsoever for an amount not less than the Termination Value of the
Equipment. Proceeds of any such insurance covering damage or loss of any Equipment shall be payable
to Lessor as loss payee. (b) The Total Amount Financed as set forth on the Schedule A-1 does not
include the payment of any premium for any liabilit y insurance coverage for bodily injury and/or property
damage caused to others and no such insurance will be purchased by Lessor. (c) Lessee at its sole
expense shall at all times carry public liability and property damage insurance in amounts reasonably
satisfactory to Lessor protecting Lessee and Lessor from liabilities for injuries to persons and damage to
property of others relating in any way to any Equipment. Proceeds of any such public liability or property
insurance shall be payable first to Lessor as additional insured to the extent of its liability, and then to
Lessee.
14.2 All insurers shall be reasonably satisfactory to Lessor. Lessee shall promptly deliver to
Lessor satisfactory evidence of required insurance coverage and all renewals and replacements thereof.
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Each insurance policy will require that the insurer give Lessor at least 30 days prior written notice of any
cancellation of such policy and will require that Lessor’s interests remain insured regardless of any act,
error, misrepresentation, omission or neglect of Lessee. The insurance maintained by Lessee shall be
primary without any right of contribution from insurance which may be maintained by Lessor.
15. PURCHASE OPTION. Upon thirty (30) days prior written notice by Lessee to Lessor, and so long as
there is no Event of Default then existing, Lessee shall have the option to purchase all, but not less than
all, of the Equipment covered by a Lease on any Rent Payment due date by paying to Lessor all Rent
Payments then due (including accrued interest, if any) plus the Termination Value amount set forth on the
Payment Schedule to the applicable Lease for such date. Upon satisfaction by Lessee of such purchase
conditions, Lessor shall release its Lien on such Equipment and Lessee shall retain its title to such
Equipment “AS-IS, WHERE-IS,” without representation or warranty by Lessor, express or implied, except
for a representation that such Equipment is free and clear of any Liens created by Lessor.
16. LESSEE’S REPRESENTATIONS AND WARRANTIES. With respect to each Lease and its
Equipment, Lessee hereby represents and warrants to Lessor that:
(a) Lessee has full power, authority and legal right to execute and deliver the Lease and to
perform its obligations under the Lease, and all such actions have been duly authorized by appropriate
findings and actions of Lessee’s governing body;
(b) the Lease has been duly executed and delivered by Lessee and constitutes a legal, valid and
binding obligation of Lessee, enforceable in accordance with its terms;
(c) the Lease is authorized under, and the authorization, execution and delivery of the Lease
complies with, all applicable federal, state and local laws and regulations (including, but not limited to, all
open meeting, public bidding and property acquisition laws) and all applicable judgments and court
orders;
(d) the execution, delivery and performance by Lessee of its obligations under the Lease will not
result in a breach or violation of, nor constitute a default under, any agreement, lease or other instrument
to which Lessee is a party or by which Lessee’s properties may be bound or affected;
(e) there is no pending, or to the best of Lessee’s knowledge threatened, litigation of any nature
which may have a material adverse effect on Lessee’s ability to perform its obligations under the Lease;
and
(f) Lessee is a state, or a political subdivision thereof, as referred to in Section 103 of the Code,
and Lessee’s obligation under the Lease constitutes an enforceable obligation issued on behalf of a state
or a political subdivision thereof.
17. TAX COVENANTS. Lessee hereby covenants and agrees that:
(a) Lessee shall comply with all of the requirements of Section 149(a) and Section 149(e) of the
Code, as the same may be amended from time to time, and such compliance shall include, but not be
limited to, keeping a complete and accurate record of any assignments of any Lease and executing and
filing Internal Revenue Form 8038G or 8038GC, as the case may be, and any other information
statements reasonably requested by Lessor;
(b) Lessee shall not do (or cause to be done) any act which will cause, or by omission of any act
allow, any Lease to be an “arbitrage bond” within the meaning of Section 148(a) of the Code or any Lease
to be a “private activity bond” within the meaning of Section 141(a) of the Code; and
(c) Lessee shall not do (or cause to be done) any act which will cause, or by omission of any act
allow, the interest portion of any Rent Payments to be or become includable in gross income for Federal
income taxation purposes under the Code.
(d) If Lessor either (i) receives notice, in any form, from the IRS; or (ii) reasonably determines,
based on an opinion of independent tax counsel selected by Lessor and approved by Lessee, which
approval Lessee shall not unreasonably withhold, that Lessor may not exclude the interest component of
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any Rent Payment under a Tax-Exempt Lease from federal gross income because Lessee breached a
covenant contained herein, then Lessee shall pay to Lessor, within thirty (30) days after Lessor notifies
Lessee of such determination, the amount which, with respect to Rent Payments previously paid and
taking into account all penalties, fines, interest and additions to tax (including all federal, state and local
taxes imposed on the interest component of all Rent Payments under such Tax-Exempt Lease due
through the date of such event) that are imposed on Lessor as a result of the loss of the exclusion, will
restore to Lessor the same after-tax yield on the transaction evidenced by such Tax-Exempt Lease
(assuming tax at the highest marginal corporate tax rate) that it would have realized had the exclusion not
been lost. Additionally, Lessee agrees that upon the occurrence of such an event with respect to a
Tax-Exempt Lease, it shall pay additional rent to Lessor on each succeeding Rent Payment due date in
such amount as will maintain such after-tax yield to Lessor. Lessor’s determination of the amount
necessary to maintain its after-tax yield as provided in this subsection (b) shall be conclusive (absent
manifest error). Notwithstanding anything in a Tax-Exempt Lease to the contrary, any payment that
Lessee is required to make pursuant to this subsection (b) shall be made only from Legally Available
Funds.
18. ASSIGNMENT.
18.1 Lessee shall not assign, transfer, pledge, hypothecate, nor grant any Lien on, nor otherwise
dispose of, any Lease or any Equipment or any interest in any Lease or Equipment.
18.2 Lessor may assign its rights, title and interest in and to any Lease or any Equipment, and/or
may grant or assign a security interest in any Lease and its Equipment, in whole or in part, to any party at
any time. Any such assignee or lien holder (an “Assignee”) shall have all of the rights of Lessor under the
applicable Lease. LESSEE AGREES NOT TO ASSERT AGAINST ANY ASSIGNEE ANY CLAIMS,
ABATEMENTS, SETOFFS, COUNTERCLAIMS, RECOUPMENT OR ANY OTHER SIMILAR
DEFENSES WHICH LESSEE MAY HAVE AGAINST LESSOR. Unless otherwise agreed by Lessee in
writing, any such assignment transaction shall not release Lessor from any of Lessor’s obligations under
the applicable Lease. An assignment or reassignment of any of Lessor’s right, title or interest in a Lease
or its Equipment shall be enforceable against Lessee only after Lessee receives a written notice of
assignment which discloses the name and address of each such Assignee. Lessee shall keep a
complete and accurate record of all such assignments in the form necessary to comply with Section
149(a) of the Code. Lessee agrees to acknowledge in writing any such assignments if so requested.
18.3 Each Assignee of a Lease hereby agrees that: (a) the term Secured Obligations as used in
Section 8.3 hereof is hereby amended to include and apply to all obligations of Lessee under the
Assigned Leases and to exclude the obligations of Lessee under any Non-Assigned Leases; (b) said
Assignee shall have no Lien on, nor any claim to, nor any interest of any kind in, any Non-Assigned
Leases; and (c) Assignee shall exercise its rights, benefits and remedies as the assignee of Lessor
(including, without limitation, the remedies under Section 20 of the Master Lease) solely with respect to
the Assigned Leases. “Assigned Leases” means only those Leases which have been assigned to an
Assignee pursuant to a written agreement; and “Non-Assigned Leases” means all Leases excluding the
Assigned Leases.
18.4 Subject to the foregoing, each Lease inures to the benefit of and is binding upon the heirs,
executors, administrators, successors and assigns of the parties hereto.
19. EVENTS OF DEFAULT. For each Lease, “Event of Default” means the occurrence of any one or
more of the following events as they may relate to such Lease: (a) Lessee fails to make any Rent
Payment (or any other payment) as it becomes due in accordance with the terms of the Lease, and any
such failure continues for ten (10) days after the due date thereof; (b) Lessee fails to perform or observe
any of its obligations under Sections 12.1, 14 or 18.1 hereof; (c) Lessee fails to perform or observe any
other covenant, condition or agreement to be performed or observed by it under the Lease and such
failure is not cured within thirty (30) days after receipt of written notice thereof by Lessor; (d) any
statement, representation or warranty made by Lessee in the Lease or in any writing delivered by Lessee
pursuant thereto or in connection therewith proves at any time to have been false, misleading or
erroneous in any material respect as of the time when made; (e) Lessee applies for or consents to the
appointment of a receiver, trustee, conservator or liquidator of Lessee or of all or a substantial part of its
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assets, or a petition for relief is filed by Lessee under any federal or state bankruptcy, insolvency or
similar law, or a petition in a proceeding under any federal or state bankruptcy, insolvency or similar law is
filed against Lessee and is not dismissed within sixty (60) days thereafter; or (f) Lessee shall be in default
under any other Lease or under any other financing agreement executed at any time with Lessor.
20. REMEDIES. If any Event of Default occurs, then Lessor may, at its option, exercise any one or more
of the following remedies:
(a) Lessor may require Lessee to pay (and Lessee agrees that it shall pay) all amounts then
currently due under all Leases and all remaining Rent Payments due under all Leases during the fiscal
year in effect when the default occurs together with interest on such amounts at the highest lawful rate
from the date of Lessor’s demand for such payment.
(b) Lessor may require Lessee to promptly return all Equipment to Lessor in the manner set forth
in Section 21 (and Lessee agrees that it shall so return the Equipment), or Lessor may, at its option, enter
upon the premises where any Equipment is located and repossess such Equipment without demand or
notice, without any court order or other process of law and without liability for any damage occasioned by
such repossession;
(c) Lessor may sell, lease or otherwise dispose of any Equipment, in whole or in part, in one or
more public or private transactions, and if Lessor so disposes of any Equipment, then Lessor shall retain
the entire proceeds of such disposition free of any claims of Lessee, provided, that the net proceeds of
any such disposition shall be applied to amounts payable by Lessee under clause (a) above of this
Section only to the extent that such net proceeds exceed the applicable Termination Value set forth in the
applicable Schedule A-1;
(d) Lessor may terminate, cancel or rescind any Lease as to any and all Equipment;
(e) Lessor may exercise any other right, remedy or privilege which may be available to Lessor
under applicable law or, by appropriate court action at law or in equity, Lessor may enforce any of
Lessee’s obligations under any Lease; and/or
(f) Lessor may require Lessee to pay (and Lessee agrees that it shall pay) all out-of-pocket costs
and expenses incurred by Lessor as a result (directly or indirectly) of the Event of Default and/or of
Lessor’s actions under this section, including, without limitation, any attorney fees and expenses and any
costs related to the repossession, safekeeping, storage, repair, reconditioning or disposition of any
Equipment.
None of the above remedies is exclusive, but each is cumulative and in addition to any other remedy
available to Lessor. Lessor’s exercise of one or more remedies shall not preclude its exercise of any
other remedy. No delay or failure on the part of Lessor to exercise any remedy under any Lease shall
operate as a waiver thereof, nor as an acquiescence in any default, nor shall any single or partial exercise
of any remedy preclude any other exercise thereof or the exercise of any other remedy.
21. RETURN OF EQUIPMENT. If Lessor is entitled under the provisions of any Lease, including any
termination thereof pursuant to Sections 6 or 20 of this Master Lease, to obtain possession of any
Equipment or if Lessee is obligated at any time to return any Equipment, then (a) title to the Equipment
shall vest in Lessor immediately upon Lessors notice thereof to Lessee, and (b) Lessee shall, at its sole
expense and risk, immediately de-install, disassemble, pack, crate, insure and return the Equipment to
Lessor (all in accordance with applicable industry standards) at any location in the continental United
States selected by Lessor. Such Equipment shall be in the same condition as when received by Lessee
(reasonable wear, tear and depreciation resulting from normal and proper use excepted), shall be in good
operating order and maintenance as required by the applicable Lease, shall be free and clear of any
Liens (except Lessor’s Lien) and shall comply with all applicable laws and regulations. Until Equipment is
returned as required above, all terms of the applicable Lease shall remain in full force and effect
including, without limitation, obligations to pay Rent Payments and to insure the Equipment. Lessee
agrees to execute and deliver to Lessor all documents reasonably requested by Lessor to evidence the
transfer of legal and beneficial title to such Equipment to Lessor and to evidence the termination of
Lessee’s interest in such Equipment.
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22. LAW GOVERNING. Each Lease shall be governed by the laws of the state of the lessee (The
“State”).
23. NOTICES. All notices to be given under any Lease shall be made in writing and either personally
delivered or mailed by certified mail to the other party at its address set forth herein or at such address as
the party may provide in writing from time to time. Any such notices shall be deemed to have been
received five (5) days subsequent to mailing if sent by regular or certified mail, or on the next business
day if sent by overnight courier, or on the day of delivery if delivered personally.
24. FINANCIAL INFORMATION; INDEMNITY; POWER OF ATTORNEY. Within thirty (30) days of their
completion in each fiscal year of Lessee during any Lease Term, Lessee will deliver to Lessor upon
Lessor’s request the publicly available annual financial information of Lessee. To the extent permitted by
law, Lessee shall indemnify, hold harmless and, if Lessor requests, defend Lessor and its shareholders,
affiliates, employees, dealers and agents against all Claims directly or indirectly arising out of or
connected with (a) the manufacture, installation, use, lease, possession or delivery of the Equipment, (b)
any defects in the Equipment, any wrongful act or omission of Lessee, or its employees and agents, or (c)
any claims of alleged breach by Lessee of this Master Lease or any related document. “Claims” means
all losses, liabilities, damages, penalties, expenses (including attorney’s fees and costs), claims, actions
and suits, whether in contract, tort or otherwise. Lessee hereby appoints Lessor its true and lawful
attorney-in-fact (with full power of substitution) to prepare any instrument, certificate of title or financing
statement covering the Equipment or otherwise protecting Lessor’s interest in the Equipment, to sign
Lessee’s name with the same force and effect as if signed by Lessee, and to file same at the proper
location(s); and make claims for, receive payment of, and execute and endorse all documents, checks or
drafts for loss, theft, damage or destruction to the Equipment under any insurance.
25. ANTI-MONEY LAUNDERING/INTERNATIONAL TRADE LAW COMPLIANCE.
Lessee represents and warrants to Lessor, as of the date of this Master Lease, the date of each
advance of proceeds pursuant to this Master Lease, the date of any renewal, extension or modification of
this Master Lease or any Lease, and at all times until this Master Lease and each Lease has been
terminated and all amounts thereunder have been indefeasibly paid in full, that: (a) no Covered Entity (i)
is a Sanctioned Person; (ii) has any of its assets in a Sanctioned Country or in the possession, custody or
control of a Sanctioned Person; or (iii) does business in or with, or derives any of its operating income
from investments in or transactions with, any Sanctioned Country or Sanctioned Person in violation of any
law, regulation, order or directive enforced by any Compliance Authority; (b) the proceeds of any Lease
will not be used to fund any operations in, finance any investments or activities in, or, make any payments
to, a Sanctioned Country or Sanctioned Person in violation of any law, regulation, order or directive
enforced by any Compliance Authority; (c) the funds used to repay any Lease are not derived from any
unlawful activity; and (d) each Covered Entity is in compliance with, and no Covered Entity engages in
any dealings or transactions prohibited by, any laws of the United States, including but not limited to any
Anti-Terrorism Laws. Lessee covenants and agrees that it shall immediately notify Lessor in writing upon
the occurrence of a Reportable Compliance Event.
As used herein: “Anti-Terrorism Laws” means any laws relating to terrorism, trade sanctions
programs and embargoes, import/export licensing, money laundering, or bribery, all as amended,
supplemented or replaced from time to time; “Compliance Authority” means each and all of the (a) U.S.
Treasury Department/Office of Foreign Assets Control, (b) U.S. Treasury Department/Financial Crimes
Enforcement Network, (c) U.S. State Department/Directorate of Defense Trade Controls, (d) U.S.
Commerce Department/Bureau of Industry and Security, (e) U.S. Internal Revenue Service, (f) U.S.
Justice Department, and (g) U.S. Securities and Exchange Commission; “Covered Entity” means Lessee,
its affiliates and subsidiaries, all guarantors, pledgors of collateral, all owners of the foregoing, and all
brokers or other agents of Lessee acting in any capacity in connection with this Master Lease or any
Lease; “Reportable Compliance Event” means that any Covered Entity becomes a Sanctioned Person, or
is indicted, arraigned, investigated or custodially detained, or receives an inquiry from regulatory or law
enforcement officials, in connection with any Anti-Terrorism Law or any predicate crime to any Anti-
Terrorism Law, or self-discovers facts or circumstances implicating any aspect of its operations with the
actual or possible violation of any Anti-Terrorism Law; “Sanctioned Country” means a country subject to a
sanctions program maintained by any Compliance Authority; and “Sanctioned Person” means any
individual person, group, regime, entity or thing listed or otherwise recognized as a specially designated,
prohibited, sanctioned or debarred person or entity, or subject to any limitations or prohibitions (including
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but not limited to the blocking of property or rejection of transactions), under any order or directive of any
Compliance Authority or otherwise subject to, or specially designated under, any sanctions program
maintained by any Compliance Authority.
26. USA PATRIOT ACT NOTICE.
To help the government fight the funding of terrorism and money laundering activities, Federal law requires
all financial institutions to obtain, verify and record information that identifies each lessee that opens an
account. What this means: when Lessee opens an account, Lessor will ask for the business name,
business address, taxpayer identifying number and other information that will allow Lessor to identify
Lessee, such as organizational documents. For some businesses and organizations, Lessor may also need
to ask for identifying information and documentation relating to certain individuals associated with the
business or organization.
27. SECTION HEADINGS. All section headings contained herein or in any Schedule are for convenience
of reference only and do not define or limit the scope of any provision of any Lease.
28. EXECUTION IN COUNTERPARTS. Each Schedule to this Master Lease may be executed in
several counterparts, each of which shall be deemed an original, but all of which shall be deemed one
instrument. Only one counterpart of each Schedule shall be marked “Lessor’s Original” and all other
counterparts shall be deemed duplicates. An assignment of or security interest in any Schedule may be
created through transfer and possession only of the counterpart marked “Lessor’s Original.”
29. ENTIRE AGREEMENT; WRITTEN AMENDMENTS. Each Lease, together with the exhibits attached
thereto and made a part hereof and other attachments thereto, and other documents or instruments
executed by Lessee and Lessor in connection therewith, constitute the entire agreement between the
parties with respect to the lease of the Equipment covered thereby, and such Lease shall not be modified,
amended, altered, or changed except with the written consent of Lessee and Lessor. Any provision of
any Lease found to be prohibited by law shall be ineffective to the extent of such prohibition without
invalidating the remainder of the Lease.
30. HEAVY-DUTY VEHICLE GREENHOUSE GAS EMISSION REDUCTION REGULATION.
(a) If the equipment leased pursuant to the Lease is a tractor, the Lessee of this heavy-duty
tractor understands that when using a heavy-duty tractor to pull a 53-foot or longer box-type trailer on a
highway within California, the heavy-duty tractor must be compliant with sections 95300-95312, title 17,
California Code of Regulations, and that it is the responsibility of the Lessee to ensure this heavy-duty
tractor is compliant. The regulations may require this heavy-duty tractor to have low-rolling-resistance
tires that are U.S. Environmental Protection Agency (U.S. EPA) SmartWay Verified Technologies prior to
current or future use in California, or may entirely prohibit use of this tractor in California if it is a model
year 2011 or later tractor and is not a U.S. EPA SmartWay Certified Tractor.
(b) If the equipment leased pursuant to the Lease is a trailer, the Lessee of this box-type trailer
understands that when using a heavy-duty tractor to pull a 53-foot or longer box-type trailer on a highway
within California, the box-type trailer must be compliant with sections 95300-95312, title 17, California
Code of Regulations, and that it is the responsibility of the Lessee to ensure this box-type trailer is
compliant. The regulations may require this trailer to have low-rolling-resistance tires and aerodynamic
technologies that are U.S. Environmental Protection Agency SmartWay Verified Technologies prior to
current or future use in California.
(c) Notwithstanding anything in the Lease to the contrary, the Lease does not prohibit the Lessee
from modifying the trailer, at Lessee’s cost, to be compliant with the requirements of the California Heavy-
Duty Vehicle Greenhouse Gas Emission Reduction Regulation.
31. IMPORTANT INFORMATION ABOUT PHONE CALLS. By providing telephone number(s) to
Lessor, now or at any later time, Lessee authorizes Lessor and its affiliates and designees to contact
Lessee regarding Lessee account(s) with Lessor or its affiliates, whether such accounts are Lessee
individual accounts or business accounts for which Lessee is a contact, at such numbers using any
means, including but not limited to placing calls using an automated dialing system to cell, VoIP or other
wireless phone number, or leaving prerecorded messages or sending text messages, even if charges
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- 11 -
may be incurred for the calls or text messages. Lessee consents that any phone call with Lessor may be
monitored or recorded by Lessor.
City of San Luis Obispo
(“Lessee”)
By:
Title:
Attention: Finance Director
990 Palm Street
San Luis Obispo, CA 93401
PNC Equipment Finance, LLC (“Lessor”)
By:
Title
155 East Broad Street, B4-B230-05-7
Columbus, OH 43215
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LEASE SCHEDULE NO. 196140000
Dated As Of April 28, 2016
This Lease Schedule (this “Schedule”) is attached and made a part of the Master Lease-Purchase
Agreement referenced below, together with all exhibits, schedules, addenda, and other attachments thereto,
executed by Lessee and Lessor (the “Lease”). Unless otherwise defined herein, capitalized terms will have the
same meaning ascribed to them in the Master Lease. All terms and conditions of the Master Lease are
incorporated herein by reference. To the extent that there is any conflict between the terms of the Lease and
this Schedule, the terms of this Schedule shall control.
Master Lease-Purchase Agreement dated April 28, 2016
1. EQUIPMENT DESCRIPTION. As used in the Lease, “Equipment” means all of the property described in
Schedule A-1 attached to this Schedule and all attachments, additions, accessions, parts, repairs,
improvements, replacements and substitutions thereto.
2. RENTAL PAYMENTS; LEASE TERM. The Rental Payments to be paid by the Lessee to Lessor, the
commencement date thereof and the lease term of this Lease Schedule are set forth on the Schedule A-1
attached to this Lease Schedule.
3. ESSENTIAL USE; CURRENT INTENT OF LESSEE. Lessee represents that the use of the Equipment is
essential to Lessee’s proper, efficient and economic functioning or to the services that Lessee provides to its
citizens and the Equipment will be used by Lessee only for the purpose of performing its governmental or
proprietary functions consistent with the permissible scope of its authority. Lessee currently intends for the
full Lease Term: to use the Equipment; to continue this Lease; and (if applicable) to make Rent Payments if
funds are appropriated in each fiscal year by its governing body.
4. ACCEPTANCE OF EQUIPMENT. AS BETWEEN LESSEE AND LESSOR, LESSEE AGREES THAT (A)
LESSEE HAS RECEIVED AND INSPECTED ALL EQUIPMENT; (B) ALL EQUIPMENT IS IN GOOD
WORKING ORDER AND COMPLIES WITH ALL PURCHASE ORDERS, CONTRACTS AND
SPECIFICATIONS; (C) LESSEE ACCEPTS ALL EQUIPMENT FOR PURPOSES OF THE LEASE “AS-IS,
WHERE IS”; AND (D) LESSEE WAIVES ANY RIGHT TO REVOKE SUCH ACCEPTANCE.
5. BANK QUALIFIED. LESSEE CERTIFIES THAT IT HAS DESIGNATED THIS LEASE AS A QUALIFIED
TAX-EXEMPT OBLIGATION IN ACCORDANCE WITH SECTION 265(b)(3) OF THE CODE, THAT IT HAS
NOT DESIGNATED MORE THAN $10,000,000 OF ITS OBLIGATIONS AS QUALIFIED TAX-EXEMPT
OBLIGATIONS IN ACCORDANCE WITH SUCH SECTION FOR THE CURRENT CALENDAR YEAR AND
THAT IT REASONABLY ANTICIPATES THAT THE TOTAL AMOUNT OF TAX-EXEMPT OBLIGATIONS
TO BE ISSUED BY LESSEE DURING THE CURRENT CALENDAR YEAR WILL NOT EXCEED
$10,000,000.
6. RE-AFFIRMATION OF THE MASTER LEASE-PURCHASE AGREEMENT. Lessee hereby re-affirms all of
its representations, warranties and obligations under the Master Lease Purchase Agreement (including,
without limitation, its obligation to pay all Rental Payments, its disclaimers in Section 7 thereof and its
representations in Section 6.1 and 16 thereof).
City of San Luis Obispo
(“Lessee”)
PNC Equipment Finance, LLC (“Lessor”)
By: By:
Title:
Title:
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E28
Schedule A-1
1. EQUIPMENT LOCATION & DESCRIPTION:
City of San Luis Obispo
136 N Chorro
San Luis Obispo, CA 93401
San Luis Obispo County
2016 Pierce Arrow XT 75' PUC VIN#
TYMCO Model 600 Regenerative Air Street Sweeper VIN#
2. LEASE PAYMENT SCHEDULE.
(a) Accrual Date: April 28, 2016
(b) Amount Financed:
i. Purchase Price for Pierce Arrow XT 75” PUC $869,806.17
Purchase Price for Street Sweeper $219,535.00
Sales Tax $84,361.92
Freight $9,000.00
ii. Purchase Price Deduction $0.00
Prepay Discounts $41,235.00
Trade In $0.00
iii. Total Amount Financed (Cash Sale Price minus
Purchase Price Deductions) $1,141,468.09
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E28
(c) Payment Schedule:
Accrual Date: April 28, 2016
Rent Payment
Number
Rent Payment
Date
Rent Payment
Amount
Interest
Portion Principal Portion Termination
Value
1 4/28/2017 240,067.42 19,404.96 220,662.46 948,429.80
2 4/28/2018 240,067.42 15,653.70 224,413.72 717,283.67
3 4/28/2019 240,067.42 11,838.66 228,228.76 482,208.04
4 4/28/2020 240,067.42 7,958.77 232,108.65 243,136.14
5 4/28/2021 240,067.42 4,012.92 236,054.50 1.00
City of San Luis Obispo PNC Equipment Finance, LLC
(“Lessee”) (“Lessor”)
By: By:
Title: Title:
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E28
VEHICLE SCHEDULE ADDENDUM
Dated As Of April 28, 2016
Lease Schedule No. 196140000 Dated April 28, 2016
Lessee: City of San Luis Obispo
Reference is made to the above Lease Schedule (“Schedule”) to the Master Lease-Purchase
Agreement identified in the Lease Schedule (“Master Lease”) by and between PNC Equipment Finance,
LLC (“Lessor”) and the above Lessee (“Lessee”). This Addendum amends and modifies the terms and
conditions of the Schedule and is hereby made a part of the Schedule. Unless otherwise defined herein,
capitalized terms defined in the Master Lease shall have the same meaning when used herein.
NOW THEREFORE, as part of the valuable consideration to induce the execution of the
Schedule, Lessor and Lessee hereby agree to amend the Schedule as follows:
1. In the event that any unit of Equipment covered by the Schedule is a vehicle or trailer under
applicable State law, then the following provisions shall also apply to the Schedule to the extent permitted
by law,
(a) each manufacturer’s statement of origin and certificate of title shall state that Lessor has the
first and sole lien on or security interest in such unit of Equipment;
(b) the public liability and property damage insurance required by the terms of the paragraph titled
“Insurance in the Master Lease shall be in an amount not less than $1,000,000.00 per person insured and
$2,000,000.00 combined single limit per unit per occurrence (provided, that if the unit of Equipment is a
bus or other passenger vehicle, then such insurance amount shall be such larger amount as may be
reasonably required by Lessor) and $1,000,000.00 for damage to property of others;
(c) Lessee shall furnish and permit only duly licensed, trained, safe and qualified drivers to
operate any such unit of Equipment, and such drivers shall be agents of Lessee and shall not be agents
of Lessor; and
(d) Lessee shall cause each such unit of Equipment to be duly registered and licensed as
required by applicable State law with Lessor noted as lien holder and Lessee as owner.
2. Except as expressly amended by this Addendum and other modifications signed by Lessor,
the Schedule remains unchanged and in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Addendum as of the date first referenced
above.
City of San Luis Obispo PNC Equipment Finance, LLC
(“Lessee”) (“Lessor”)
By: By:
Title: Title:
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E24
RESOLUTION
Municipality/Lessee: City of San Luis Obispo
Principal Amount Expected To Be Financed: $1,141,468.09
WHEREAS, the Municipality is a political subdivision of the State in which Municipality is located (the
“State”) and is duly organized and existing pursuant to the Constitution and laws of the State.
WHEREAS, pursuant to applicable law, the governing body of the Municipality (“Governing Body”) is
authorized to acquire, dispose of and encumber real and personal property, including, without limitation,
rights and interest in property, leases and easements necessary to the functions or operations of the
Municipality.
WHEREAS, the Governing Body hereby finds and determines that the execution of one or more Master
Lease-Purchase Agreements (“Leases”) in the principal amount not exceeding the amount stated above
for the purpose of acquiring the property (“Equipment”) to be described in the Leases is appropriate and
necessary to the functions and operations of the Municipality.
WHEREAS, PNC Equipment Finance, LLC (“Lessor”) shall act as Lessor under said Leases.
NOW, THEREFORE, Be It Ordained by the Governing Body of the Municipality:
Section 1. Either one of the _______________________ OR _______________________ (each an
“Authorized Representative”) acting on behalf of the Municipality, is hereby authorized to negotiate, enter
into, execute, and deliver one or more Leases in substantially the form set forth in the document presently
before the Governing Body, which document is available for public inspection at the office of the
Municipality. Each Authorized Representative acting on behalf of the Municipality is hereby authorized to
negotiate, enter into, execute, and deliver such other documents relating to the Lease as the Authorized
Representative deems necessary and appropriate. All other related contracts and agreements necessary
and incidental to the Leases are hereby authorized.
Section 2. By a written instrument signed by any Authorized Representative, said Authorized
Representative may designate specifically identified officers or employees of the Municipality to execute
and deliver agreements and documents relating to the Leases on behalf of the Municipality.
Section 3. The aggregate original principal amount of the Leases shall not exceed the amount stated
above and shall bear interest as set forth in the Leases and the Leases shall contain such options to
purchase by the Municipality as set forth therein.
Section 4. The Municipality’s obligations under the Leases shall be subject to annual appropriation or
renewal by the Governing Body as set forth in each Lease and the Municipality’s obligations under the
Leases shall not constitute general obligations of the Municipality or indebtedness under the Constitution
or laws of the State.
Section 5. As to each Lease, the Municipality reasonably anticipates to issue not more than $10,000,000
of tax-exempt obligations (other than “private activity bonds” which are not “qualified 501(c)(3) bonds”)
during the current calendar year in which each such Lease is issued and hereby designates each Lease
as a qualified tax-exempt obligation for purposes of Section 265(b) of the Internal Revenue Code of 1986,
as amended.
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E24
6
001.1145120.3
Section 6. This resolution shall take effect immediately upon its adoption and approval.
ADOPTED AND APPROVED on this ________________, 2016.
The undersigned Secretary/Clerk of the above-named Municipality hereby certifies and attests that the
undersigned has access to the official records of the Governing Body of the Municipality, that the
foregoing resolutions were duly adopted by said Governing Body of the Municipality at a meeting of said
Governing Body and that such resolutions have not been amended or altered and are in full force and
effect on the date stated below.
LESSEE: City of San Luis Obispo
____________________________________________ [SEAL]
Signature of Secretary/Clerk of Municipality
Print Name: ___________________________________
Official Title:___________________________________
Date: _______________________________________
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E24
CERTIFICATE OF INCUMBENCY
Lessee: City of San Luis Obispo
Lease Schedule No.: 196140000 Dated: April 28, 2016
I, the undersigned Secretary/Clerk identified below, do hereby certify that I am the duly elected or
appointed and acting Secretary/Clerk of the above Lessee (the “Lessee”), a political subdivision duly
organized and existing under the laws of the State where Lessee is located, that I have the title stated
below, and that, as of the date hereof, the individuals named below are the duly elected or appointed
officers of the Lessee holding the offices set forth opposite their respective names.
[NOTE: Use same titles as Authorized Representatives stated in Resolutions.]
_________________________
Name
__________________________
Title
_________________________
Signature
_________________________
Name
__________________________
Title
_________________________
Signature
IN WITNESS WHEREOF, I have duly executed this certificate and affixed the seal of such
Lessee as of the date set forth below.
____________________________________________ [SEAL]
Signature of Secretary/Clerk of Lessee
Print Name: __________________________________
Official Title:___________________________________
Date: ________________________________________
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E34
FORM OF OPINION OF COUNSEL
(To Be Typed on Attorney’s Letterhead Stationary)
Date:
Lessee: City of San Luis Obispo
Lessor: PNC Equipment Finance, LLC
Re: Lease Schedule No. 196140000 dated April 28, 2016, together with its Master Lease-Purchase
Agreement dated April 28, 2016, by and between the above-named Lessee and the above-named
Lessor
Gentlemen:
I have acted as counsel to Lessee with respect to the Lease Schedule, the Master Lease-Purchase
Agreement and all other agreements described above or related thereto (collectively, the “Agreements”) and various
related matters, and in this capacity have reviewed a duplicate original or certified copy of the Agreements and such
other documents as I have deemed necessary for the purposes of this opinion.
Based upon the examination of such documents, it is my opinion that:
1. Lessee is a political subdivision of the State of California (the “State”) duly organized, existing and operating
under the Constitution and laws of the State.
2. Lessee is authorized and has power under State law to enter into all of the Agreements, and to carry out its
obligations thereunder and the transactions contemplated thereby.
3. The Agreements and all other documents related thereto have been duly authorized, approved, and executed by
and on behalf of Lessee, and each of the Agreements is a valid and binding contract of Lessee enforceable in
accordance with its terms, except to the extent limited by State and Federal law affecting creditor’s remedies and
by bankruptcy, reorganization or other laws of general application relating to or affecting the enforcement of
creditors’ rights.
4. The authorization, approval and execution of the Agreements and all other proceedings of Lessee relating to the
transactions contemplated thereby have been performed in accordance with all applicable Local, State and
Federal laws (including open meeting laws and public bidding and property acquisition laws).
5. To the best of my knowledge, there is no litigation or proceeding pending before any court, administrative agency
or governmental body, that challenges: the organization or existence of Lessee; the authority of its officers; the
proper authorization; approval and execution of any of the Agreements or any documents relating thereto; the
appropriation of monies to make payments under the Agreements for the current fiscal year; or the ability of
Lessee otherwise to perform its obligations under the Agreements and the transactions contemplated thereby.
6. Lessee is a political subdivision of the State as referred to in Section 103 of the Internal Revenue Code of 1986,
as amended, and the related regulations and rulings thereunder.
Lessor, its Assignee and any of their assigns may rely upon this opinion.
Very truly yours,
Attorney
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I01
INSURANCE COVERAGE DISCLOSURE
PNC Equipment Finance, LLC, LESSOR
City of San Luis Obispo, LESSEE
RE: INSURANCE COVERAGE REQUIREMENTS
1. In accordance with the Lease Schedule (“Schedule”) to the Master Lease-Purchase Agreement
identified in the Lease Schedule (“Master Lease”), Lessee certifies that it has instructed the insurance
agent named below (please fill in name, address, and telephone number):
to issue: (check to indicate coverage)
a. All Risk Physical Damage Insurance on the leased Equipment evidenced by a Certificate of Insurance
and Long Form Loss Payable Clause naming PNC Equipment Finance, LLC and/or its assigns as Loss
Payee.
Coverage Required: Termination Value Specified
b. Public Liability Insurance evidenced by a Certificate of Insurance naming PNC Equipment Finance,
LLC and/or its assigns as an Additional Insured.
Minimum Coverage Required:
$1,000,000.00 per person
$2,000,000.00 aggregate bodily injury liability
$1,000,000.00 property damage liability
Proof of insurance coverage will be provided to PNC Equipment Finance, LLC, 155 East Broad Street,
B4-B230-05-7, Columbus, OH 43215, prior to the time that the property is delivered to Lessee.
OR
2. Pursuant to the Master Lease, Lessee represents and warrants, in addition to other matters under the
Agreement, that it is lawfully self-insured for: (check to indicate coverage)
a. All risk, physical damage in the amount specified in 1(a) above.
b. Public liability for not less than the amounts specified in 1(b) above.
Lessee has attached a signed letter describing self-insurance.
LESSEE: City of San Luis Obispo
By: _________________________________ Title: ___________________________________
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I01
INSURANCE INFORMATION
Please provide the following information to your insurance company to help
expedite receipt of the necessary coverage:
ITEMS WHICH NEED TO BE REFLECTED ON INSURANCE CERTIFICATE:
• PNC Equipment Finance, LLC must be named Loss Payee and Additional
Insured
• 30 Days Notice of Cancellation
• Not Less than $2,000,000.00 limits on liability
• Certificate must reflect a short equipment description
• Certificate must reflect an expiration date
Certificate Holder Information:
PNC Equipment Finance, LLC, its successors and/or all assigns
155 East Broad Street, B4-B230-05-7
Columbus, OH 43215
Please send a FAX copy of certificate to Cheryl Kennedy at 1-800-678-0602.
The original should be mailed to the same at:
PNC Equipment Finance, LLC
155 East Broad Street, B4-B230-05-7
Columbus, OH 43215
Please call Cheryl Kennedy at 1-800-820-9041, ext. 4, if you have any questions.
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E28
THREE PARTY AGREEMENT
Dated as of April 28, 2016
“Lessee” means City of San Luis Obispo
“Schedule” means Lease Schedule No. 196140000 Dated April 28, 2016, together with its Schedule A-1.
Reference is made to the Lease Schedule (“Schedule”) and to the Master Lease-Purchase
Agreement (“Master Lease”) identified in said Lease Schedule, described above between PNC
Equipment Finance, LLC (“Lessor”) and the Lessee identified above which relates to Equipment
described in Schedule A-1 to the Lease Schedule attached therein (“Equipment”) to be supplied by Pierce
Manufacturing Inc. (“Supplier”). For good and valuable consideration, receipt of which is hereby
acknowledged, Lessee, Lessor and Supplier hereby agree as follows:
1. Notwithstanding anything to the contrary in the Lease Schedule, Lessee hereby notifies Lessor that
the Equipment has not yet been delivered to Lessee and the Equipment has not yet been accepted by
Lessee for purposes of the Lease Schedule. Lessee agrees to execute and deliver to Lessor a Delivery
and Acceptance Certificate in the form attached hereto as Exhibit A upon the circumstances set forth in
said Certificate.
2. All parties hereto agree that the Purchase Price of the Equipment shall be as set forth below if said
Purchase Price is paid on or before the Advance Payment Date set forth below:
Purchase Price:
Sales Tax:
$869,806.17
$66,079.12
Vendor Discounts: $41,235.00
Advance Payment Date: April 28, 2016
3. Upon execution of the Lease Schedule and delivery of all documents relating thereto required by
Lessor, Lessee agrees that it shall pay the Lessee Down Payment stated below and Lessor agrees that it
shall pay the balance of the Purchase Price (the “Amount Financed”) stated below. Lessee agrees that
the Lease Term and Lessee’s obligation to pay Rent Payments shall commence on the date set forth in
the Lease Schedule notwithstanding the delivery of the Equipment at a later date.
Lessee Down Payment: $0.00
Trade In:
Amount Financed:
$0.00
$1,141,468.09
4. (a) Supplier anticipates that it shall deliver the Equipment to Lessee by the Anticipated Delivery
Date set forth below.
Anticipated Delivery Date: May 28, 2017
(b) Supplier hereby agrees that it shall deliver the Equipment to Lessee no later than the Outside
Delivery Date set forth below and that such Equipment shall comply with all specifications and
requirements of Lessee and with the terms and conditions of any purchase order/purchase
agreement relating thereto.
Outside Delivery Date: July 28, 2017
5. If for any reason whatsoever Supplier fails to comply with its agreements set forth in subparagraph
4(b) of this Agreement by the Outside Delivery Date for any piece of Equipment (the “Delayed
Equipment”), and the Lessee has not agreed to revise the Outside Delivery Date with respect to such
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E28
Delayed Equipment, then Supplier hereby agrees as follows only for the Delayed Equipment:
(a) On the first business day after the Outside Delivery Date, Supplier shall pay to Lessee the Lessee
Down Payment for the Delayed Equipment plus interest at the Prime Rate plus one percent (1%)
per annum from the Advance Payment Date to the date of such payment;
(b) On the first business day after the Outside Delivery Date, Supplier shall pay to Lessor for the
Delayed Equipment the Amount Financed plus interest at the Prime Rate plus one percent (1%)
per annum from the Advance Payment Date to the date of such payment; and
(c) “Prime Rate” means the prime rate of interest as published from time to time in the Wall Street
Journal.
If there is more than one piece of Equipment subject to the Lease, and some of the Equipment is
delivered in accordance with subparagraph 4(b) of this Agreement, the payments owed pursuant to the
Lease shall be modified to reflect only the obligations due on the Equipment that was delivered pursuant
to subparagraph 4(b) of this Agreement. The new payment obligation will be determined based on the
amount financed for the Equipment delivered to the Lessee, and based on the interest rate in effect as of
the date of Lease commencement.
6. If Supplier makes the payments described in paragraph 5 above for the Delayed Equipment under
the circumstances set forth above and if Lessee has otherwise paid and performed its obligations under
the Lease Schedule as of such payment date for the Delayed Equipment, then Lessee and Lessor agree
that the Lease Schedule shall terminate as of the date of such payments by Supplier as to the Delayed
Equipment only. Lessee’s obligations shall continue unabated for the Equipment that was delivered
pursuant to subparagraph 4(b) of this Agreement.
7. Supplier agrees that a Performance Bond will be issued which names the Supplier as Principal, the
Lessee as Obligee and the Lessor as Additional Obligee. This Performance Bond will apply solely to the
terms and conditions of the purchase order/purchase agreement, including related equipment
specifications and warranties, as issued by the lessee and accepted by the Supplier. The “Contract
Date” referred to in the Performance Bond shall be the date of the Three Party Agreement. Except as
expressly set forth herein, the Lease Schedule and the terms and conditions of the purchase
order/purchase agreement for the equipment remain unchanged and in full force and effect.
8. Except as expressly set forth herein, the Lease Schedule and terms and conditions of the purchase
order/purchase agreement for the Equipment remain unchanged and in full force and effect.
IN WITNESS WHEREOF, the duly authorized officers of the parties set forth below hereby
execute and deliver this Agreement as of the date first written above.
City of San Luis Obispo PNC Equipment Finance, LLC
(“Lessee”) (“Lessor”)
By: By:
Title: Title:
Pierce Manufacturing Inc.
(“Supplier”)
By:
Title:
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E28
Exhibit A
DELIVERY & ACCEPTANCE CERTIFICATE
Lease Schedule No. 196140000
Reference is made to the above Lease Schedule (“Schedule”), which has been executed and
delivered by the undersigned Lessee (“Lessee”) and PNC Equipment Finance, LLC (“Lessor”). This
Certificate amends and supplements the terms and conditions of the Lease Schedule and is hereby made
a part of the Lease Schedule. Unless otherwise defined herein, capitalized terms defined in the Master
Lease-Purchase Agreement and the Lease Schedule shall have the same meaning when used herein;
provided, that “Equipment” shall mean the Equipment described in the Schedule A-1 and in any
attachment or exhibit to this Certificate.
Notwithstanding anything to the contrary, expressed or implied, in the Lease Schedule or its
Schedule A-1, Lessee agrees as follows:
1. ACCEPTANCE OF EQUIPMENT. As of the Acceptance Date stated below and as between Lessee
and Lessor, Lessee hereby agrees that: (a) Lessee has received and inspected all Equipment; (b) all
Equipment is in good working order and complies with all purchase orders, contracts and
specifications; (c) Lessee accepts all Equipment for purposes of the Lease “as-is, where-is”; and (d)
Lessee waives any right to revoke such acceptance.
ACCEPTANCE DATE:
2. RENT PAYMENTS. Lessee hereby agrees that Lessee will pay the Rent Payments for the
Equipment in the amounts and on the dates specified in Schedule A-1 to the Lease Schedule.
City of San Luis Obispo
(“Lessee”)
By: __________________________________
Title: __________________________________
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ESCROW RIDER
Dated As of April 28, 2016
Lease Schedule No. 196140000 Dated April 28, 2016
MASTER LEASE-PURCHASE AGREEMENT DATED APRIL 28, 2016
LESSEE: CITY OF SAN LUIS OBISPO
Reference is made to the above Lease Schedule (“Schedule”) to the Master Lease-Purchase Agreement
identified in the Schedule (“Master Lease”) by and between PNC Equipment Finance, LLC (“Lessor”) and the above
lessee (“Lessee”). As used herein, “Lease” shall mean the Schedule and the Master Lease, but only to the extent that
the Master Lease related to the Schedule. This Addendum amends and modifies the terms and conditions of the
Lease and is hereby made a part of the Lease. Unless otherwise defined herein, capitalized terms defined in the
Master Lease shall have the same meaning when used herein.
NOW, THEREFORE, as part of the valuable consideration to induce the execution of the Lease, Lessor and
Lessee hereby agree to amend the Lease as follows:
1. “Escrow Agreement” means the Escrow Agreement relating to a Schedule, dated the Commencement Date
under such Schedule and substantially in the form attached to this Master Lease, among Lessor, Lessee and
the escrow agent therein identified, with respect to the Escrow Fund established and to be administered
thereunder. “Escrow Fund” means the fund of that name established pursuant to an Escrow Agreement.
2. Lessee and Lessor together with a mutually acceptable escrow agent agree to enter into an escrow agreement
(Escrow Agreement”) establishing a fund (“Equipment Acquisition Fund”) from which the Purchase Price of the
Equipment will be paid. The terms and conditions of the Escrow Agreement shall be satisfactory in form and
substance, to Lessor and Lessee.
3. In order to provide financing to pay the costs to acquire and install the Equipment (“Total Amount Financed”)
as described in a Schedule, Lessor and Lessee hereby agree to execute and deliver an Escrow Agreement
relating to such Schedule on the date on which the Funding Conditions for such Schedule are satisfied as
provided in Section 5.3. If Lessee signs and delivers a Schedule and an Escrow Agreement and if all Funding
Conditions have been satisfied in full, then Lessor will deposit or cause to be deposited into an Escrow Fund
under the related Escrow Agreement an amount (which may include estimated investment earnings thereon)
equal to the Purchase Price for the Equipment to be financed under the related Schedule.
4. Lessee shall, at its sole expense, arrange for the transportation, delivery and installation of all Equipment to
the location specified in the Schedule (“Location”) by Equipment suppliers (“Suppliers”) selected by Lessee.
Lessee shall accept Equipment for purposes of the related Lease as soon as it has been delivered and is
operational. Lessee shall evidence its acceptance of any Equipment by signing and delivering to Lessor a
Certificate of Acceptance in the form and manner required by the applicable Escrow Agreement.
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5. If a Non-Appropriation Event or an Event of Default occurs prior to Lessee’s acceptance of all the Equipment
under the related Schedule, the amount then on deposit in the Escrow Fund shall be applied to prepay the
unpaid principal component of the Rent Payments in whole on the first business day of the month next
succeeding the occurrence of either such Event plus accrued interest to the prepayment date; provided,
however, that the amount to be prepaid by Lessee pursuant to this Section 5 shall first be paid from moneys
in the related Escrow Fund and then from Legally Available Funds and other moneys available for such
purpose as a result of the exercise by Lessor of its rights and remedies under the related Schedule. Any funds
on deposit in the Escrow Fund on the prepayment date described in this Section 5 in excess of the unpaid
principal component of the Rent Payments to be prepaid plus accrued interest thereon to the prepayment date
shall be paid promptly to Lessee.
6. To the extent that Lessee has not accepted items of Equipment before the eighteen-month anniversary of the
Commencement Date identified on the related Schedule, the amount then on deposit in the related Escrow
Fund shall be applied to prepay the unpaid principal component of the Rent Payments in part, in inverse order
of Rent Payments, on the first business day of the next month plus accrued interest to the prepayment date;
provided, however, that the amount to be prepaid by Lessee pursuant to this Section 6 shall first be paid from
moneys in the related Escrow Fund and then from Legally Available Funds. Notwithstanding any such partial
prepayment, the related Schedule shall remain in full force and effect with respect to the portion of the
Equipment accepted by Lessee during such eighteen-month period, and the portion of the principal component
of Rent Payments remaining unpaid after such prepayment plus accrued interest thereon shall remain payable
in accordance with the terms of the related Schedule. Upon Lessor’s request, Lessee shall execute an
amendment to the related Payment Schedule that reflects the change to the Rent Payments as a result of
such partial prepayment.
7. As collateral security for Lessee’s obligations to pay all Rent Payments and all other amounts due and payable
under each Lease and to perform and observe all covenants, agreements and conditions (direct or indirect,
absolute or contingent, due or to become due or existing or hereafter arising) of Lessee under such Lease,
Lessee hereby grants to Lessor a first priority, exclusive security interest in any and all of the Equipment (now
existing or hereafter acquired) under each Lease, moneys and investments held from time to time the Escrow
Fund under each Escrow Agreement and any and all proceeds of any of the foregoing. Lessee agrees to
execute and deliver to Lessor all necessary documents to evidence and perfect such security interest,
including, without limitation, Uniform Commercial Code (UCC) financing statements and any amendments
thereto and certificates of title or certificates of origin (or applications thereof) noting Lessor’s interest thereon.
8. The Lease Term of the Lease shall commence on the earlier of the date specified in the Payment Schedule to
the Lease or the date of Lessor’s deposit of funds into the Equipment Acquisition Fund. Notwithstanding the
statements regarding delivery and acceptance of the Equipment in the Schedule, the parties acknowledge that
the Equipment will be delivered or installed as provided in the Escrow Agreement.
9. The delivery of documents and the satisfaction of any other conditions required by the Escrow Agreement or
this Addendum shall be additional Funding Conditions for the Lease.
10. Upon Lessee’s execution of the Escrow Agreement, Lessee hereby represents and warrants to Lessor that:
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(a) Lessee has full power, authority and legal right to execute and deliver the Escrow Agreement and
to perform its obligations under the Escrow Agreement, and all such actions have been duly authorized by
appropriate findings and actions of Lessee’s governing body;
(b) the Escrow Agreement has been duly executed and delivered by Lessee and constitutes a legal,
valid and binding obligations of Lessee, enforceable in accordance with its terms; and
(c) the Escrow Agreement is authorized under, and the authorization, execution and delivery of the
Escrow Agreement complies with, all applicable federal, state and local laws and regulations (including, but
not limited to, all open meeting, public bidding and public investment (laws) and all applicable judgments and
court orders.
11. The opinion of Lessee’s legal counsel will include statements to the same effect as the representations of
Lessee in paragraph 10 above.
12. It shall be an additional event of default under the Lease if lessee fails to pay or perform any of its obligations
under the Escrow Agreement or this Addendum or if any of the representations of Lessee in the Escrow
Agreement or this Addendum prove to be false, misleading or erroneous in any material respect.
Except as expressly amended by this Rider and other modifications signed by Lessor, the Lease remains
unchanged and in full force and effect.
IN WITNESS WHEREOR, the parties hereto have executed this Rider as of the date first referenced above.
City of San Luis Obispo PNC Equipment Finance, LLC
(Lessee) (Lessor)
By: By
TITLE: TITLE:
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ESCROW AGREEMENT
THIS ESCROW AGREEMENT (“Escrow Agreement”) is made as of April 28, 2016 by and among PNC EQUIPMENT
FINANCE, LLC (“Lessor”), City of San Luis Obispo (“Lessee”) and U.S. BANK NATIONAL ASSOCIATION, as escrow agent
(“Escrow Agent”).
Lessor and Lessee have heretofore entered into that certain Master Lease-Purchase Agreement dated as of
April 28, 2016 (the “Master Lease”) and a Lease Schedule 196140000 thereto dated April 28, 2016 (the “Schedule”
and, together with the terms and conditions of the Master Lease incorporated therein, the “Lease”). The Lease
contemplates that certain equipment described therein (the “Equipment”) is to be acquired from the vendor(s) or
manufacturer(s) thereof. After acceptance of the Equipment by Lessee, the Equipment is to be leased by Lessor to
Lessee pursuant to the terms of the Lease.
The Lease further contemplates that Lessor will deposit an amount equal to the anticipated aggregate
acquisition cost of the Equipment (the “Total Amount Financed”), being $246,817.80, with Escrow Agent to be held in
escrow and applied on the express terms set forth herein. Such deposit, together with all interest and other additions
received with respect thereto (hereinafter the “Escrow Fund”) is to be applied to pay the vendor(s) or manufacturer(s)
of the Equipment (the “Vendor”) its invoice cost (a portion of which may, if required, be paid prior to final acceptance of
the Equipment by Lessee); and, if applicable, to reimburse Lessee for progress payments already made by it to the
Vendor of the Equipment.
The parties desire to set forth the terms on which the Escrow Fund is to be created and to establish the rights
and responsibilities of the parties hereto.
NOW, THEREFORE, in consideration of the sum of Ten Dollars ($10.00) in hand paid, and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. (a) Escrow Agent hereby agrees to serve as escrow agent upon the terms and conditions set
forth herein. (b) The moneys and investments held in the Escrow Fund are irrevocably held in trust for the benefit of
Lessee and Lessor, and such moneys, together with any income or interest earned thereon, shall be expended only as
provided in this Escrow Agreement, and shall not be subject to levy or attachment or lien by or for the benefit of any
creditor of either Lessee or Lessor. Lessor, Lessee and Escrow Agent intend that the Escrow Fund constitute an
escrow account in which Lessee has no legal or equitable right, title or interest until satisfaction in full of all conditions
contained herein for the disbursement of funds by the Escrow Agent therefrom. However, if the parties’ intention that
Lessee shall have no legal or equitable right, title or interest until all conditions for disbursement are satisfied in full is
not respected in any legal proceeding, the parties hereto intend that Lessor have a security interest in the Escrow
Fund, and such security interest is hereby granted by Lessee to secure payment of all sums due to Lessor under the
Lease. For such purpose, Escrow Agent hereby agrees to act as agent for Lessor in connection with the perfection of
such security interest and agrees to note, or cause to be noted, on all books and records relating to the Escrow Fund,
the Lessor’s interest therein.
2. On such day as is determined to the mutual satisfaction of the parties (the “Closing Date”), Lessor shall
deposit with Escrow Agent cash in the amount of the Purchase Price, to be held in escrow by Escrow Agent on the
express terms and conditions set forth herein.
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On the Closing Date, Escrow Agent agrees to accept the deposit of the Purchase Price by Lessor, and further
agrees to hold the amount so deposited together with all interest and other additions received with respect thereto, as
the Escrow Fund hereunder, in escrow on the express terms and conditions set forth herein.
3. Escrow Agent shall at all times segregate the Escrow Fund into an account maintained for that express
purpose, which shall be clearly identified on the books and records of Escrow Agent as being held in its capacity as
Escrow Agent. Securities and other negotiable instruments comprising the Escrow Fund from time to time shall be
held or registered in the name of Escrow Agent (or its nominee). The Escrow Fund shall not, to the extent permitted
by applicable law, be subject to levy or attachment or lien by or for the benefit of any creditor of any of the parties
hereto (except with respect to the security interest therein held by Lessor).
4. The cash comprising the Escrow Fund from time to time shall be invested and reinvested by Escrow
Agent in one or more investments as directed by Lessee in Exhibit 1. Escrow Agent will use due diligence to collect
amounts payable under a check or other instrument for the payment of money comprising the Escrow Fund and shall
promptly notify Lessee and Lessor in the event of dishonor of payment under any such check or other instruments..
Interest or other amounts earned and received by Escrow Agent with respect to the Escrow Fund shall be deposited in
and comprise a part of the Escrow Fund.
5. Upon request by Lessee and Lessor, Escrow Agent shall send monthly statements of account to Lessee
and Lessor, which statements shall set forth all withdrawals from and interest earnings on the Escrow Fund as well as
the investments in which the Escrow Fund is invested.
6. Escrow Agent shall take the following actions with respect to the Escrow Fund:
(a) Upon Escrow Agent’s acceptance of the deposit of the Purchase Price, an amount equal to
Escrow Agent’s set-up fee, as set forth on Exhibit 2 hereto, shall be disbursed from the Escrow Fund to
Escrow Agent in payment of such fee.
(b) From time to time, Escrow Agent shall pay to the Vendor of the Equipment payments then due
and payable with respect thereto upon receipt of duly executed Requisition Request and Certificate of
Acceptance form attached as Exhibit 3 hereto, subject to Lessor’s prior written approval of each such
Requisition Request and Certificate of Acceptance.
(c) If an Event of Default or Non-Appropriation Event occurs under the Lease prior to the Lessee’s
acceptance of all the Equipment or to the extent that funds have not been disbursed from the Escrow Fund
within the eighteen-month period identified in the Lease, funds then on deposit in the Escrow Fund shall be
applied to the prepayment of Rent Payments under the Lease as instructed by Lessor.
(d) Upon receipt by Escrow Agent of written notice from Lessor that the purchase price of the
Equipment has been paid in full, Escrow Agent shall apply the then remaining Escrow Fund, first, to all
outstanding fees and expenses incurred by Escrow Agent in connection herewith as evidenced by its
statement forwarded to Lessor and Lessee, and, second, to Lessor for application against the interest
component of Rent Payments under the Lease as provided therein, unless otherwise agreed by Lessor.
7. The fees and expenses, including any legal fees, of Escrow Agent incurred in connection herewith shall
be the responsibility of Lessee. The basic fees and expenses of Escrow Agent shall be as set forth on Exhibit 2 hereto
and Escrow Agent is hereby authorized to deduct such fees and expenses from the Escrow Fund as and when the
same are incurred without any further authorization from Lessee or Lessor. Escrow Agent may employ legal counsel
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- 6 -
and other experts as it deems necessary for advice in connection with its obligations hereunder. Escrow Agent waives
any claim against Lessor with respect to compensation hereunder.
8. Escrow Agent shall have no liability for acting upon any written instruction presented by Lessor in
connection with this Escrow Agreement, which Escrow Agent in good faith believes to be genuine. Furthermore,
Escrow Agent shall not be liable for any act or omission in connection with this Escrow Agreement except for its own
negligence, willful misconduct or bad faith. Escrow Agent shall not be liable for any loss or diminution in value of the
Escrow Fund as a result of the investments made by Escrow Agent.
9. Escrow Agent may resign at any time by giving thirty (30) days’ prior written notice to Lessor and
Lessee. Lessor may at any time remove Escrow Agent as Escrow Agent under this Escrow Agreement upon written
notice. Such removal or resignation shall be effective on the date set forth in the applicable notice. Upon the effective
date of resignation or removal, Escrow Agent will transfer the Escrow Fund to the successor Escrow Agent selected by
Lessor.
10. This Escrow Agreement and the escrow established hereunder shall terminate upon receipt by Escrow
Agent of the written notice from Lessor specified in Section 6(c) or Section 6(d) hereof.
11. In the event of any disagreement between the undersigned or any of them, and/or any other person,
resulting in adverse claims and demands being made in connection with or for any moneys involved herein or affected
hereby, Escrow Agent shall be entitled at its option to refuse to comply with any such claim or demand, so long as
such disagreement shall continue, and in so refusing Escrow Agent may refrain from making any delivery or other
disposition of any moneys involved herein or affected hereby and in so doing Escrow Agent shall not be or become
liable to the undersigned or any of them or to any person or party for its failure or refusal to comply with such
conflicting or adverse demands, and Escrow Agent shall be entitled to continue so to refrain and refuse so to act until:
(a) the rights of the adverse claimants have been finally adjudicated in a court assuming and
having jurisdiction of the parties and the moneys involved herein or affected hereby; or
(b) all differences shall have been adjusted by agreement and Escrow Agent shall have been
notified thereof in writing signed by all of the persons interested.
12. All notices (excluding billings and communications in the ordinary course of business) hereunder shall be
in writing, and shall be sufficiently given and served upon the other party if delivered (a) personally, (b) by United
States registered or certified mail, return receipt requested, postage prepaid, (c) by an overnight delivery by a service
such as Federal Express or Express Mail from which written confirmation of overnight delivery is available, or (d) by
facsimile with a confirmation copy by regular United States mail, postage prepaid, addressed to the other party at its
respective address stated below the signature of such party or at such other address as such party shall from time to
time designate in writing to the other party, and shall be effective from the date of mailing.
13. This Escrow Agreement shall inure to the benefit of and shall be binding upon the parties hereto and
their respective successors and assigns. No rights or obligations of Escrow Agent under this Escrow Agreement may
be assigned without the prior written consent of Lessor.
14. This Escrow Agreement shall be governed by and construed in accordance with the California laws of
the state of California This Escrow Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof, and no waiver, consent, modification or change of terms hereof shall bind any
party unless in writing signed by all parties.
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IN WITNESS W HEREOF, the parties hereto have caused this Escrow Agreement to be duly executed as of the
day and year first above set forth.
PNC EQUIPMENT FINANCE, LLC, as Lessor
By
Name: _________________________________
Title: __________________________________
Address: 155 E. Broad St., 5th Floor
Columbus, OH 43215
City of San Luis Obispo , as Lessee
By ______________________________________
Name: _________________________________
Title: __________________________________
Attention: Finance Director
Address: 990 Palm Street
San Luis Obispo, CA 93401
U.S BANK NATIONAL ASSOCIATION, as Escrow Agent
By
Name: _________________________________
Title: __________________________________
Address: 10 West Broad Street, 12th Floor
Columbus, OH 43215
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EXHIBIT 1
INVESTMENT DIRECTION LETTER
U.S. Bank National Association
10 W. Broad St.
CN OH TT4
Columbus, OH 43215
Re: Escrow Agreement dated as of April 28, 2016,
among PNC Equipment Finance, LLC as Lessor,
City of San Luis Obispo as Lessee, and
U.S. Bank National Association, as Escrow Agent
Ladies and Gentlemen:
Pursuant to the above-referenced Escrow Agreement, $246,817.80 will be deposited in escrow with you on or
about April 28, 216. Such funds shall be invested in one or more of the following qualified investments in the amounts
indicated:
AMOUNT OF
PLEASE CHECK DESIRED QUALIFIED INVESTMENTS: INVESTMENT
1.
Direct general obligations of the United States of
America;
$ __________
2.
Obligations – the timely payment of the principal of and interest on which is fully and unconditionally guaranteed by the United States of America;
$
3.
General obligations of the agencies and instrumentalities of the United States of America acceptable to Lessor;
$
4.
Money market funds whose investment parameters target investments in securities as described above;
$
IF NONE OF THE ABOVE BOXES ARE CHECKED, INVESTMENT SHALL BE MADE IN MONEY MARKET
FUNDS AS DESCRIBED IN THE FOURTH CATEGORY ABOVE, UNTIL LESSEE DIRECTS OTHERWISE.
Very truly yours,
CITY OF SAN LUIS OBISPO, AS LESSEE
By: _______________________________________
Name: _________________________________
Title: __________________________________
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EXHIBIT 2
ESCROW AGENT FEES AND EXPENSES
SET-UP FEES
$250.00 payable from the Escrow Fund upon acceptance of escrow deposit.
EXPENSES
Any and all out-of-pocket expenses incurred by Escrow Agent will be the responsibility of Lessee and paid
from the Escrow Fund.
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155 E. Broad St., B4-B230-05-7,
Columbus, Ohio 43215 • Telephone (800) 811-4796
Please Retain for Future Reference
Page No. 1
INVOICE # 04282016
Bill To:
City of San Luis Obispo
2160 Santa Barbara Ave
San Luis Obispo, CA 93401
Remit To:
PNC Equipment Finance, LLC
155 E. Broad St., B4-B230-05-7
Columbus, OH 43215
INVOICE
Lease No. 196140000
Initial Charges:
Escrow Payment $250.00
PAY THIS AMOUNT $250.00
INVOICE DATE
3/28/2016
DUE DATE
4/28/2016
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F-2004.1-1 MMDA Eff: 4/30/04
U.S. BANK NATIONAL ASSOCIATION
MONEY MARKET ACCOUNT
DESCRIPTION AND TERMS
The U.S. Bank Money Market account is an U.S. Bank National Association (“U.S. Bank”) interest-bearing
time deposit account designed to meet the needs of U.S. Bank’s Corporate Trust Services Escrow Group
and other Corporate Trust customers of U.S. Bank. Selection of this investment includes authorization to
place funds on deposit with U.S. Bank.
U.S. Bank uses the daily balance method to calculate interest on this account (actual/365 or 366) by
applying a daily periodic rate to the principal balance in the account each day. Interest is accrued daily and
credited monthly to the account. Interest rates are determined at U.S. Bank’s discretion, and may be tiered
based on customer deposit amount.
The owner of the account is U.S. Bank as Agent for its trust customers. U.S. Bank’s trust department
performs all account deposits and withdrawals. The deposit account is insured by the Federal Deposit
Insurance Corporation up to $250,000.
AUTOMATIC AUTHORIZATION
In the absence of specific written direction to the contrary, U.S. Bank is hereby directed to invest and
reinvest proceeds and other available moneys in the U.S. Bank Money Market Account.
City of San Luis Obispo ___________________________________
Company Name Signature of Authorized Directing Party
____________________________________
Trust Account Number – includes existing Title / Date
and future sub-accounts unless otherwise directed
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EXHIBIT 3
REQUISITION REQUEST AND CERTIFICATE OF ACCEPTANCE NO._______
(to be submitted with each requisition request for payment to the vendor)
-or-
____ (√) FINAL REQUISITION REQUEST AND CERTIFICATE OF ACCEPTANCE
(to be submitted with the final requisition request upon acceptance of the Equipment)
The Escrow Agent is hereby requested to pay from the Escrow Fund established and maintained under that certain
Escrow Agreement dated as of April 28, 2016 (the “Escrow Agreement”) by and among PNC Equipment Finance, LLC (the
“Lessor”), City of San Luis Obispo (the “Lessee”), and U.S. Bank National Association (the “Escrow Agent”), the amount set
forth below to the named payee(s). The amount shown is due and payable under a purchase order or contract (or has been
paid by and not previously reimbursed to Lessee) with respect to equipment being leased under that certain Master
Lease-Purchase Agreement dated as of April 28, 2016 (the “Master Lease”) and Lease Schedule 196140000 thereto dated
April 28, 2016 (the “Schedule” and, together with the terms and conditions of the Master Lease incorporated therein, the
“Lease”), by and between the Lessor and the Lessee, and has not formed the basis of any prior requisition request.
PAYEE AMOUNT
Total requisition amount $______________
The undersigned, as Lessee under the Lease hereby certifies:
1. The items of the Equipment, as such term is defined in the Lease, fully and accurately described on the
Equipment List attached hereto have been delivered and installed at the location(s) set forth therein.
2. A present need exists for the Equipment which need is not temporary or expected to diminish in the near future.
The Equipment is essential to and will be used by the Lessee only for the purpose of performing one or more governmental
functions of Lessee consistent with the permissible scope of Lessee’s authority.
3. The estimated useful life of the Equipment based upon the manufacturer’s representations and the Lessee’s
projected needs is not less than the Lease Term of lease with respect to the Equipment.
4. The Lessee has conducted such inspection and/or testing of the Equipment as it deems necessary and
appropriate and hereby acknowledges that it accepts the Equipment for all purposes as of the date of this Certificate.
5. The Equipment is covered by insurance in the types and amounts required by the Lease.
6. No Event of Default or Non-Appropriation Event, as each such term is defined in the Lease, and no event
which with the giving of notice or lapse of time, or both, would become such an Event of Default or Non-Appropriation Event
has occurred and is continuing on the date hereof.
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7. Sufficient funds have been appropriated by the Lessee for the payment of all Rent Payments due under the
Lease during Lessee’s current fiscal year.
8. Based on the foregoing, Lessor is hereby authorized and directed to fund the acquisition of the Equipment set
forth on the Equipment List by paying, or causing to be paid, the manufacturer(s)/vendor(s) the amounts set forth on the
attached invoices.
9. The following documents are attached hereto and made a part hereof:
(a) Original Invoice(s);
(b) Copies of Certificate(s) of Origin designating Lessor as lienholder if any part of the Equipment
consists of motor vehicles, and evidence of filing; and
(c) Requisition for Payment
10. If this is the final acceptance of Equipment, then as of the Acceptance Date stated below and as between the
Lessee and the Lessor, the Lessee hereby agrees that: (a) the Lessee has received and inspected all of the Equipment
described in the Lease; (b) all Equipment is in good working order and complies with all purchase orders, contracts and
specification; (c) the Lessee accepts all Equipment for purposes of the Lease “as-is, where-is”; and (d) the Lessee waives
any right to revoke such acceptance.
If Lessee paid an invoice prior to the commencement date of the Lease and is requesting reimbursement for such payment,
also attach a copy of evidence of such payment together with a copy of Lessee’s Declaration of Official Intent and other
evidence that Lessee has satisfied the requirements for reimbursement set forth in Treas. Reg. §1.150-2.
Acceptance Date: __________________
City of San Luis Obispo , as Lessee
By
Name: _________________________________
Title: ___________________________________
Date: ______________________________________
PNC Equipment Finance, LLC, as Lessor
By:
Title:
Date:
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PNC Equipment Finance, LLC
INFORMATION REQUEST
LESSEE NAME: City of San Luis Obispo
FEDERAL TAX I.D. # ___________________________________________
BILLING ADDRESS:
________________________________________________________________________
Billing Contact
________________________________________________________________________
Street Address or Post Office Box
________________________________________________________________________
City, State and Zip
_____________________________________________________________________________________
Phone Number Fax Number
____________________________________________
Email Address
PHYSICAL ADDRESS (IF DIFFERENT):
________________________________________________________________________
Street Address or Post Office Box
________________________________________________________________________
City, State and Zip
Require Board Approval for Payments? _______ Yes _______ No
Board Meeting Date? ___________________
Require signed vouchers for payments? _______ Yes _______ No
We typically mail our invoices 30 days in advance. Taking into account a 7-day mail period, do you foresee any problem that
would prevent the payment from being received on or before the due date?
______ Yes _______ No
Please list any special instructions below:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
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Form 8038-G
(Rev. September 2011)
Department of the Treasury
Internal Revenue Service
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 8038-GC.
OMB No. 1545-0720
Part I Reporting Authority If Amended Return, check here ▶
1 Issuer’s name 2 Issuer’s employer identification number (EIN)
3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instructions)3b Telephone number of other person shown on 3a
4 Number and street (or P.O. box if mail is not delivered to street address)Room/suite 5 Report number (For IRS Use Only)
3
6 City, town, or post office, state, and ZIP code 7 Date of issue
8 Name of issue 9 CUSIP number
10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see
instructions)
10b Telephone number of officer or other
employee shown on 10a
Part II Type of Issue (enter the issue price). See the instructions and attach schedule.
11 Education ..............................11
12 Health and hospital ..........................12
13 Transportation ............................13
14 Public safety .............................14
15 Environment (including sewage bonds) ....................15
16 Housing ..............................16
17 Utilities ..............................17
18 Other. Describe ▶18
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 ........ ▶
Part III Description of Obligations. Complete for the entire issue for which this form is being filed.
21
(a) Final maturity date (b) Issue price (c) Stated redemption
price at maturity
(d) Weighted
average maturity (e) Yield
$ $ years %
Part IV Uses of Proceeds of Bond Issue (including underwriters’ discount)
22 Proceeds used for accrued interest .....................22
23 Issue price of entire issue (enter amount from line 21, column (b)) ...........23
24 Proceeds used for bond issuance costs (including underwriters’ discount) ..24
25 Proceeds used for credit enhancement ............25
26 Proceeds allocated to reasonably required reserve or replacement fund .26
27 Proceeds used to currently refund prior issues .........27
28 Proceeds used to advance refund prior issues .........28
29 Total (add lines 24 through 28) .......................29
30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) ...30
Part V Description of Refunded Bonds. Complete this part only for refunding bonds.
31 Enter the remaining weighted average maturity of the bonds to be currently refunded .... ▶years
32 Enter the remaining weighted average maturity of the bonds to be advance refunded .... ▶years
33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) ...... ▶
34 Enter the date(s) the refunded bonds were issued ▶ (MM/DD/YYYY)
For Paperwork Reduction Act Notice, see separate instructions.Cat. No. 63773S Form 8038-G (Rev. 9-2011)
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Form 8038-G (Rev. 9-2011)Page 2
Part VI Miscellaneous
35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) ....35
36 a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract
(GIC) (see instructions) .........................36a
b Enter the final maturity date of the GIC ▶
c Enter the name of the GIC provider ▶
37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans
to other governmental units ........................37
38 a If this issue is a loan made from the proceeds of another tax-exempt issue, check box ▶and enter the following information:
b Enter the date of the master pool obligation ▶
c Enter the EIN of the issuer of the master pool obligation ▶
d Enter the name of the issuer of the master pool obligation ▶
39 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box .... ▶
40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box ............. ▶
41 a If the issuer has identified a hedge, check here ▶and enter the following information:
b Name of hedge provider ▶
c Type of hedge ▶
d Term of hedge ▶
42 If the issuer has superintegrated the hedge, check box ..................... ▶
43 If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated
according to the requirements under the Code and Regulations (see instructions), check box ........ ▶
44 If the issuer has established written procedures to monitor the requirements of section 148, check box ..... ▶
45a If some portion of the proceeds was used to reimburse expenditures, check here ▶and enter the amount
of reimbursement ......... ▶
b Enter the date the official intent was adopted ▶
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.
▲
Signature of issuer’s authorized representative Date
▲
Type or print name and title
Paid
Preparer
Use Only
Print/Type preparer’s name Preparer's signature Date Check if
self-employed
PTIN
Firm’s name ▶
Firm's address ▶
Firm's EIN ▶
Phone no.
Form 8038-G (Rev. 9-2011)
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RESOLUTION NO. _____ (2016 Series)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN LUIS
OBISPO, CALIFORNIA, APPROVING THE LEASE PURCHASE OF A
FIRE ENGINE AND A STREET SWEEPER FROM PNC EQUIPMENT
FINANCE, LLC AND APPROVING THE FINAL FORM OF FINANCING
DOCUMENTS AND OFFICIAL ACTIONS
WHEREAS, the City of San Luis Obispo (the “City”) is a political subdivision of the
State of California and is duly organized and exist ing pursuant to the Constitution and laws of
the State; and
WHEREAS, the City of San Luis Obispo (the “City”) maintains fire protection and street
maintenance services and which includes rolling stock equipment which must be replaced from
time to time.
WHEREAS, pursuant to applicable law, the City of San Luis Obispo may acquire,
dispose of and encumber real and personal property, including, without limitation, rights and
interest in property, leases and easements necessary to the functions or operations of the city.
WHEREAS, the City Council has considered a Lease Purchase Financing proposal
offered by PNC Equipment Finance, LLC and desires to authorize the execution of the lease in
the amount of $1,141,468.09.
WHEREAS, the final form of the legal documentation relating to the financing has been
prepared and the City Council wishes at this time to approve the final financing plan and the
final form of such legal documentation
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis
Obispo as follows/or that (whatever action is needed):
SECTION 1. Approval of Lease Purchase Financing Proposal. The City Council hereby
approves the Lease Purchase of a new 2016 Pierce Arrow XT PUC Quint Aerial Fire Apparatus
in the not to exceed amount of $894,650.29 and a new 2016 TYMCO Model 600 Regenerative
Air Street Sweeper Truck in the not to exceed amount of $246,817.80 from PNC Equipment
Finance, LLC in accordance with the Lender Financing Proposal in the form on file with the City
Clerk.
SECTION 2. The City’s obligations under the Lease shall be subject to annual
appropriation or renewal by the City Council as set forth in the Lease and the Municipality’s
obligations under the Lease shall not constitute general obligations of the Municipality or
indebtedness under the Constitution or laws of the State.
SECTION 3. Master Lease Purchase Agreement. The City Council hereby approves the
Master Lease Purchase Agreement relating to the financing of the fire engine, between the City
and PNC Equipment Finance, LLC in the form thereof on file with the City Clerk together with
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Resolution No. _____ (2016 Series) Page 2
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any changes therein or additions thereto deemed advisable by an Authorized Officer; provided
that the execution thereof by an Authorized Officer shall be conclusive evidence of the approval
of any such changes or additions. An Authorized
Officer is hereby authorized and directed for and in the name and on behalf of the City to
execute, and the City Clerk is hereby authorized and directed to attest, the final form of the
Installment Sale Agreement.
SECTION 4. Official Actions. The Mayor, the City Manager, the Director of Finance
and Information Technology, the City Clerk and all other officers of the City are each authorized
and directed in the name and on behalf of the City to make any and all assignments, certificates,
requisitions, agreements, notices, consents, instruments of conveyance, warrants and other
documents, which they or any of them deem necessary or appropriate in order to consummate
any of the transactions contemplated by the agreements and documents approved under this
Resolution. Whenever in this Resolution any officer of the City is authorized to execute or
countersign any document or take any action, such execution, countersigning or action may be
taken on behalf of such officer by any person designated by such officer to act on his or her
behalf in the case such officer is absent or unavailable.
SECTION 5. As to the Lease Agreement, the City reasonably anticipates to issue not
more than $10,000,000 of tax-exempt obligations (other than “private activity bonds” which are
not “qualified 501(c)(3) bonds”) during the current calendar year in which the Lease is issued
and hereby designates this Lease as a qualified tax -exempt obligation for purposes of Section
265(b) of the Internal Revenue Code of 1986, as amended.
SECTION 6. Effective Date. This Resolution shall take effect immediately upon its
passage and adoption.
Upon motion of _______________________, seconded by _______________________,
and on the following roll call vote:
AYES:
NOES:
ABSENT:
The foregoing resolution was adopted this _____ day of _____________________ 2016.
____________________________________
Mayor Jan Marx
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Resolution No. _____ (2016 Series) Page 3
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ATTEST:
____________________________________
Lee Price, MMC
Interim City Clerk
APPROVED AS TO FORM:
_____________________________________
J. Christine Dietrick
City Attorney
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City
of San Luis Obispo, California, this ______ day of ______________, _________.
______________________________
Lee Price, MMC
Interim City Clerk
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