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R2005-0039 02-14-05RESOLUTION NO. R2005-39 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS, AWARDING A BID FOR THE LEASE/PURCHASE OF FIVE (5) PHILLIPS HEARTSTART MRx ALS MONITORS. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS: Section 1. That the City opened bids for lease/purchase financing of five (5) Phillips HeartStart MRx ALS Monitors, and such bids have been reviewed and tabulated. Section 2. That the City Council hereby awards the bid to Cybex Capital Corporation in accordance with Option 1 described in Exhibit "A" attached hereto. Section 3. The City Manager or his designee is hereby authorized to execute a contract for the Lease/Purchase of five (5) Phillips HeartStart MRx ALS Monitors. PASSED, APPROVED and ADOPTED this the 14th day of February , A.D., 2005. TOM REID MAYOR ATTEST: UN I , TY CRETAR APPROVED AS TO FORM: ~%r~.-., DARRIN M. COKER CITY ATTORNEY .~CYBEX Capita/ Corporation Date: January 10, 2005 To: Mr. Jeff Sundseth Pearland EMS Pearland, TX 77581 HEART From: Diane Thornton-Wallace Vice President, New Business Development Cybex Capital Corporation Thank you for the opportunity to present you with these competitive and flexible financing solutions for the Philips MRx equipment you need for your department. Finance Options Option I - 48 Months, 2% Interest Term: 48 Months Advance Payment: 1 @ $1777 Then 4 @ 0.00 Then 43 @ $1777 Purchase Option: $1.00 Option II - 60 Months, 2% Interest Term: 60 Months Advance Payment: Purchase Option 1 @ $1396 Then 4 @ 0.00 Then 55 @ $1396 $1.00 Quotations are subject to final rate and credit approval by Cybex Capital Corporation, its agents or assigns. Our payment quotations do not include taxes (if applicable). A documentation fee of $175 will be payable with the advance payment. Rates are subject to change; these quotes are valid for 30 days from the date of this letter. ~~L~ 1 ~1 LEASE #: 9322892 NOTICE: THIS IS A BINDING CONTRACT CONSISTING OF ALL TERMS ON BOTH SIDES. THIS CONTRACT WAS WRITTEN IN PLAIN LANGUAGE FOR YOUR BENEFIT. IT CONTAINS IMPORTANT TERMS AND CONDITIONS AND HAS LEGAL AND FINANCIAL CONSEQUENCES TO YOU. PLEASE READ IT CAREFULLY; FEEL FREE TO ASK QUESTIONS BEFORE SIGNING. PLAIN LANGUAGE MUNICIPAL LEASE Leasing Company: Bank of Blue Valley (Lessor) P. O. sox 26128 Overland Park. KS. 66225-6128 in, use EXACT registered corporate name.) 3519 Liberty Dr. Pearland, TX 77581 Equipment Location: 3519 Liberty Dr. Peadand, TX 77581 COUNTY OF: model, serial no. and all attachments.) (Attach separate "Schedule A" if necessary.) Five (5) HeartStart MRx ALS Monitors together with all present and future attachments, accessories, replacement parts and additions thereto and made a part thereof. ~ w' D Collateral securing other loans and leases with this Lessor also secures this lease, including, but not limited to, the equipment listed above. ii H Q ^/ Vendor: Phillips Medical Systems 2301 5th Ave.. Suite 200 Seattle. WA 98121 ~~ l~ ~ J `O~ RENTAL PAYMENTS: One (1) payment of $1,798.72 due at signing. Advance Payment(s): $ 1,798.72 50 46 Four (4) monthly payments of ED.OD followed by forty-five (45) monthly payments of Other: (Doc Fees) $ 175.00 MONTHS PAYMENTS 51,777.00 due beginning Total Payment Due: E 1,973.72 (Plus Applicable Taxes) Annual Interest Rate: 2.00 % Total Cost Being Financed: 578,2E 1. LEASE. You agree to lease trom us and we agree to lease to you the egwpmeni identified above together witi~ any replacerent parts, additions or repairs (the "~quiprrenY') under the terms stated in this Equipment Lease Agreement (the "Lease"). You authorize us to correct obvious errors in this Lease and to insert the Lease number, the serial numbers and other data identifying the Equipment, and other missing terms above (if any) following your execution of this Lease. 2. TERM. You agree this Lease will not start until we sign it. Once it starts, you agree it will continue for the full term shown above and any extension term (the "Term"), except as provided herein. 3. RENT. You agree to pay us monthly rent for the full Term in the amount shown above, except as provided in Section 4. That amount is based on the estimated cost of all Equipment, and you agree it may be adjusted upward or downward if the actual cost exceeds or is less than this estimate. The monthly due date and the due date for the first payment will be set by us but will not be more than 30 days from the day you accept delivery of the Equipment. Rent is due whether or not you receive an invoice from us. You will pay to us any required Advance Payment or Security Deposit when you sign this Lease. If we collect more than one payment as Advance Payment, we may apply such Advance Payment to the last rent payment. If all or any part of a payment is late, we may charge you a late fee of $25.00 or 7 % of the amount that is late, whichever is more. If you make any payment by any means that is refused or returned to us for any reason, you will pay us a returned item fee of $ 30.00. Unless a proper exemption certificate is provided, applicable sales and use taxes will be added to the rent. Time is of the essence with respect to all payments due and all of your other obligations under this Lease. 4. NON-APPROPRIATION OF FUNDS. You intend to remit all rent and-other payments to us for the full Term if funds are legally available. You agree to do all things within your power to obtain and maintain funds from which the rent may be paid, including making provisions for such payments to the extent necessary in each annual budget submitted and adopted in accordance with applicable provisions of the laws of the State, to have such portion of the budget approved and to exhaust all available review and appeals in the event such portion of the budget is not approved. You are, however, only obligated to pay rent under this Lease in fiscal years in which funds have been appropriated. In the event your governing body does not appropriate funds at any time during the Term for the Equipment subject to this Lease or for equipment which is functionally similar to the Equipment and operating funds are not otherwise available to you to pay the rent and other payments due and to become due under this lease, and there is no other legal procedure or available funds by or with which payment can be made to us, you may terminate this Lease on the last day of the fiscal period for which funds were appropriated, and all obligations to make rent payments shall terminate at the end of such fiscal period except as to the portion of rent for which funds shall have been appropriated and budgeted; provided that if you have not delivered possession of the Equipment to us and conveyed the Equipment or released your interest in the Equipment by the last day of the fiscal period, the termination will nevertheless be effective but you will be responsible for the payment of damages in an amount equal to the amount of the rent thereafter coming due which is attributable to the number of days after such fiscal period during which you fail to take such action, and for any other loss we may have suffered as a result of your failure to take such actions as required. In the event of anon-appropriation of funds, at least sixty (60) days prior to the end of your fiscal year, your chief executive officer (or legal counsel) shall certify in writing that (a) funds have not been appropriated for the fiscal period, (b) you have done all things within your power to obtain and maintain funds from which the rent may be paid and (c) you have exhausted all funds legally available for the payment of rent. To the extent permitted by law, if you terminate this Lease because of non-appropriation of funds, you may not purchase, lease or rent equipment performing functions similar to those performed by the Equipment for a period of twelve (12) months. This Section 4 shall not permit you to terminate this Lease in order to acquire any other Equipment or to allocate funds directly or indirectly to perform essentially the application for which the Equipment is intended. 5. ESCROW AGREEMENT. If Lessor and Lessee mutually agree to use an Escrow Account, then immediately following the execution and delivery of this Lease, Lessor, Lessee and the Escrow Agent will execute and deliver the Escrow Agreement. In such event, [his Lease will take effect only upon execution and delivery of the Escrow Agreement. We will deposit the sum of $78,265.80 with the Escrow Agent, which will be held, invested and disbursed in accordance with the Escrow Agreement. 6. DELIVERY. You agree that we are not responsible for delivery or installation of the Equipment. You will not have any claim against us if the manufacturer or supplier (collectively called the "Vendor" in this Lease) delays in delivery or installation, or if the Equipment is unsatisfactory for any reason. 7. SELECTION AND PURCHASE OF EQUIPMENT. You understand and agree that: (A) WE DID NOT SELECT, MANUFACTURE, SUPPLY OR INSPECT THE EQUIPMENT AND HAVE NO EXPERTISE REGARDING THE EQUIPMENT; (B) YOU SELECTED THE VENDOR AND THE EQUIPMENT-BASED ON YOUR OWN JUDGEMENT; (C) WE ARE BUYING THE EQUIPMENT AT YOUR REQUEST ONLY FOR THE PURPOSE OF LEASING 1T TO YOU; (D) YOU AGREE THAT THIS LEASE QUALIFIES AS A "FINANCE LEASE" AS THAT TERM IS DEFINED IN ARTICLE 2A OF THE UNIFORM COMMERCIAL CODE ("UCC"); (E) BEFORE SIGNING THIS LEASE, YOU RECEIVED AND APPROVED ANY SUPPLY CONTRACT BETWEEN US AND THE VENDOR; AND (F) YOU HAVE BEEN ADVISED IN WRITING (OR ARE NOW ADVISED IN THIS LEASE) THAT YOU MAY HAVE RIGHTS AGAINST THE VENDOR UNDER THE SUPPLY CONTRACT (IF ANY) AND THAT YOU MAY CONTACT THE VENDOR TO FIND OUT WHAT THESE RIGHTS AGAINST THE VENDOR ARE (IF ANY). LEASE AGREEMENT CONTINUES ON REVERSE SIDE -~ BY SIGNING THIS LEASE YOU ACKNOWLEDGE AND AGREE THAT: (i) YOU HAVE HAD AN OPPORTUNITY TO DISCUSS THE TERMS AND CONDITIONS IN THIS LEASE WITH US BEFORE SIGNING THIS DOCUMENT; (ii) YOU HAVE READ AND UNDERSTAND THE TERMS AND CONDITIONS ON THE FRONT AND BACK OF THIS LEASE; (iii) THIS LEASE IS A NET LEASE THAT CANNOT BE TERMINATED OR CANCELLED, EXCEPT AS PROVIDED IN SECTION 4; (iv) YOU HAVE AN UNCONDITIONAL OBLIGATION TO MAKE ALL PAYMENTS DUE UNDER THIS LEASE IN ALL FISCAL YEARS IN WHICH FUNDS HAVE BEEN BUDGETED AND APPROPRIATED AND YOU CANNOT WITHHOLD, SET-OFF OR REDUCE SUCH PAYMENTS FOR ANY REASON; (v) THE PERSON SIGNING BELOW IS AUTHORIZED TO SIGN THIS LEASE AND BIND YOU; (vi) THIS LEASE CONTAINS THE ENTIRE AGREEMENT BETWEEN THE PARTIES AND NO OTHER ORAL OR WRITTEN AGREEMENTS ARE IN EFFECT; (vii) THIS LEASE MAY NOT BE AMENDED EXCEPT BY A WRITTEN AGREEMENT SIGNED BY BOTH PARTIES AND WILL BE BINDING ON BOTH PARTIES, THEIR SUCCESSORS AND ASSIGNS; AND (viii) ANY FAILURE OF THE LESSOR TO EXERCISE ANY RIGHT HEREUNDER SHALL NOT BE CONSTRUED AS A WAIVER OF THE RIGHT TO EXERCISE THE SAME OR ANY OTHER RIGHT AT ANY TIME AND FROM TIME TO TIME THEREAFTER. /~~ ~ // 1 ~ ~ p j /]/ t-~--"- Date '` --a° ` AUTHORIZED SIGNATURE p"~"--"~"'~`~ vvitness Print Name and Title: Tele o No.: 281- -1662 DELIVERY AND ACCEPTANCE CERTIFICATION WE (THE LEASING CUSTOMER) CERTIFY THAT ALL EQUIPMENT REFERRED TO ABOVE HAS BEEN DELIVERED AND IS FULLY INSTALLED. WE ALSO CERTIFY THAT WE HAVE INSPECTED THE EQUIPMENT AND THAT IT IS IN GOOD OPERATING ORDER AND FIT FOR OUR INTENDED USE. WE UNCONDITIONALLY ACCEPT THE EQUIPMENT AND ACKNOWLEDGE THAT IT HAS NOT BEEN ACCEPTED ON A "TRIAL" BASIS. WE NOW REQUEST THAT THE LEASING COMPANY SIGN THE LEASE AND PAY THE EQUIPMENT VENDOR. WE UNDERSTAND THE IMPORTANCE OF THIS CERTIFICATION TO THE LEASING COMPANY PRIOR TO PAYING THE VENDOR, AND WE UNDERSTAND WE WILL BE PRECLUDED FROM DENYING THE TRUTH OF THIS CERTIFICATION IN THE FUTURE. X DATE OF DELIVERY AUTHORIZED SIGNATURE TITLE OPINION OF COUNSEL AS COUNSEL FOR City of Peanand, Texas (THE "LESSEE"), I HAVE EXAMINED THIS LEASE AND I AM OF THE OPINION THAT (a) THE EXECUTION, PERFORMANCE AND DELIVERY BY LESSEE OF THE LEASE HAVE BEEN DULY AUTHORIZED BY ALL NECESSARY ACTION ON THE PART OF LESSEE, (b) THE SIGNATURE(S) OF THE PERSON(S) WHO HAS EXECUTED THE LEASE IS TRUE AND GENUINE AND THIS PERSON(S) HAS THE AUTHORITY ON BEHALF OF LESSEE TO ENTER INTO THE LEASE, (c) THE LEASE CONSTITUTES A LEGAL, VALID AND 81NDING OBLIGATION OF LESSEE ENFORCEABLE IN ACCORDANCE WITH ITS TERMS; AND (d) LESSEE HAS SUFFICIENT MONIES AVAILABLE TO MAKE ALL PAYMENTS REQUIRED TO BE PAID UNDER THE LEASE DURING THE CURRENT FISCAL YEAR OF THE LESSEE, AND SUCH MONIES HAVE BEEN PROPERLY BUDGETED AND APPROPRIATED FOR THIS PURPOSE IN ACCORDANCE W ITH STATE LAW. X DATE ATTORNEY FOR LESSEE PRINTED NAME Lease Agreement -continued 8. IMPORTANT CONDITIONS. You understand and agree that: (A) YOU ARE UNCONDITIONALLY OBLIGATED TO PAY ALL LEASE PAYMENTS AND OTHER AMOUNTS DUE IN ALL FISCAL YEARS IN WHICH FUNDS HAVE BEEN APPROPRIATED NO MATTER WHAT HAPPENS, EVEN IF THE EQUIPMENT IS DAMAGED OR DESTROYED, IF IT IS DEFECTIVE, OR IF YOU CAN NO LONGER USE IT. (B) WE ARE LEASING THE EQUIPMENT TO YOU "AS IS" AND WE HAVE MADE NO REPRESENTATION, GUARANTEE OR WARRANTY, EXPRESS OR IMPLIED (INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE), REGARDING THE EQUIPMENT. WE DISCLAIM ALL SUCH WARRANTIES OR GUARANTEES OF ANY KIND, INCLUDING COMPLIANCE WITH ALL YEAR 2000 ISSUES. WE AGREE TO TRANSFER TO YOU ALL WARRANTIES, IF ANY, MADE BY THE VENDOR TO US. (C) WE WILL NOT BE LIABLE FOR ANY LOSS OR INJURY TO YOU OR ANY OTHER PERSON OR PROPERTY (including lost profits and consequential, incidental or special damages) CAUSED BY THE EQUIPMENT OR ITS FAILURE TO OPERATE. (D) To the extent permitted by applicable law, YOU WAIVE ANY AND ALL RIGHTS AND REMEDIES YOU HAVE UNDER ARTICLE 2A (Sections 508-522) OF THE UCC, INCLUDING BUT NOT LIMITED TO YOUR RIGHTS TO : (i) cancel or repudiate the Lease; (ii) reject or revoke acceptance of the Equipment; (iii) grant a security interest in the Equipment; (iv) accept partial delivery of the Equipment; (v) "cover" by making any purchase or lease of substitute equipment; (vi) seek specific performance against us; and (vii) recover damages from us for any breaches of warranty or for any other reason. If any provision of this Lease or the application thereof shall be held to 6e invalid or unenforceable, the same shall not affect in any respect whatsoever the validity or the application of any other provision of this Lease. (E) YOU UNDERSTAND THAT WE AND THE VENDOR ARE TWO SEPARATE AND INDEPENDENT COMPANIES, AND THAT NEITHER THE VENDOR NOR ANY OTHER PERSON IS OUR AGENT. YOU AGREE THAT NO REPRESENTATION, GUARANTEE OR WARRANTY BY THE VENDOR OR OTHER PERSON IS BINDING ON US, AND NO BREACH BY THE VENDOR OR OTHER PERSON WILL EXCUSE YOUR OBLIGATIONS TO US. YOU ALSO UNDERSTAND THAT ONLY OUR OFFICER IS AUTHORIZED TO WAIVE OR ALTER ANY OF THE TERMS OF THIS LEASE AND THAT ANY SUCH WAIVER OR ALTERATION MUST BE IN WRITING. (F) IF THE EQUIPMENT DOES NOT WORK AS REPRESENTED BY THE VENDOR, OR IF THE VENDOR OR ANY OTHER PERSON FAILS TO PROVIDE ANY SERVICE, OR IF THE EQUIPMENT IS UNSATISFACTORY FOR ANY OTHER REASON, YOU WILL MAKE ANY CLAIM SOLELY AGAINST THE VENDOR OR OTHER PERSON AND WILL MAKE NO CLAIM AGAINST US. 9. REPAIRS AND SERVICE. You understand that we are not responsible for repairs or service to the Equipment. You will use the Equipment in the manner for which it was intended, keep the Equipment in good condition and will service the Equipment as and when needed. All replacement parts and additions to the Equipment will become our property. 10. USE. You certify that the Equipment will be used solely for governmental use during the duration of this lease and in a manner complying with all applicable federal, state and local laws and regulations. You will not permit the equipment to be used in or for any private commercial activity. You will not (a) make any alterations to the Equipment; (b) allow it to be used by anyone but your employees; or (c) move it to any other location without our written permission. You will not attach the Equipment to any real estate. 11. RISK OF LOSS; DAMAGE; INSURANCE. You are responsible for any loss, destruction or damage to the Equipment from any cause at all, whether or not insured, from the time the Equipment is shipped to you until it is returned to us. NO SUCH LOSS OR DAMAGE SHALL IMPAIR YOUR OBLIGATIONS UNDER THIS LEASE WHICH SHALL CONTINUE IN FULL FORCE AND EFFECT. You will keep the Equipment insured against all risks of loss in an amount not less than the replacement cost, and will list us as the loss payee. If requested, you ~.vill also carry public liability insurance listing us as additional insured in amounts acceptable tc us. You agree to previde us with satisfactory writter. evidence of al! such insurance ar,d yeu agree to give us twenty (20) days prior written notice of any cancellation of any insurance. YOU AGREE THAT IF YOU FAIL TO OBTAIN SUCH INSURANCE, WE MAY (BUT ARE NOT OBLIGATED TO) OBTAIN IT AND CHARGE YOU A FEE IN WHICH CASE, WE WILL BE THE SOLE INSURED PARTY AND YOU WILL HAVE NO RIGHTS UNDER THE INSURANCE POLICY. YOU HEREBY GIVE US POWER OF ATTORNEY TO APPLY FOR INSURANCE BENEFITS AND TO ENDORSE CHECKS RECEIVED IN PAYMENT. 12. TAXES AND OTHER FEES. You understand that this is a "net" lease and agree to pay us upon demand for all taxes, if any (including sales, use, personal property and other taxes) and other fees of any kind which may be charged regarding the leasing, use or ownership of the Equipment. 13. INDEMNITY. You agree to defend us against and indemnify (reimburse) us for all claims, liabilities, losses, damages, costs and legal fees arising out of the manufacture, purchase, ownership, leasing, use or possession of the Equipment, including claims for property damage or injury to persons. This promise will continue after the end of the Term. 14. TITLE. Unless otherwise required by the laws of the state where you are located, you shall have title to the Equipment immediately upon delivery and shall be deemed to be the owner of the Equipment as long as you are not in default under this lease. In the event of a default or non-appropriation, title to the Equipment shall revert to us free and clear of any rights or interests you may have in the Equipment. YOU HEREBY GIVE US POWER OF ATTORNEY TO SIGN AND FILE FINANCING STATEMENTS. YOU AGREE TO PAY OUR FILING AND OTHER ADMINISTRATIVE AND PROCESSING FEES. You hereby grant to us a security interest in the Equipment and agree that the financing statements will create a perfected security interest in our favor. You will not allow any other liens or encumbrances to be placed on the Equipment. 15. DEFAULT. You agree that we may declare you in default if you (a) fail to make any payment for a period of twenty (20) days after the due date; (b) do not comply with any other term in this Lease or any other agreement you have with us; (c) any action is brought against you causing the Equipment to be taken or encumbered; (d) you become insolvent, make or consent to an assignment for the benefit of creditors, file or have filed against you a bankruptcy, sell all or substantially all of your assets, make or consent to the appointment of a receiver or trustee; (e) the Equipment or any part of it is abused, illegally used, misused, last, destroyed or damaged beyond repair; or (f) any insurance carrier cancels or threatens to cancel any insurance on [he Equipment. If any of these defaults occurs, you agree that we may take one or both of the following actions, in addition to other actions available under law: (A) terminate the Lease and/or sue for (i) any and all amounts which may be then due and payable by you to us under this Lease, plus (b) all rent payments remaining through the end of the then current fiscal year, and (ii) the costs listed in Section 16 below; AND (B) enter the Equipment site, without any court order or other process of law, and repossess the Equipment, or render the Equipment unusable without removal, or sue for a repossession court order. You agree to waive any trespass or right of action for damages as a result of our actions to enter, repossess and/or disable the Equipment. Following repossession: (a) all of your rights to the Equipment will end; (b) we may re-market the Equipment without advance notice to you; and (c) we may also sue for the amounts listed in 15(A) above without first re- marketing the Equipment. You agree that we are not required to repossess and re-market the Equipment, and you waive any rights under any law that provide otherwise. 16. RECOVERY COSTS. You agree to pay all of our recovery costs after a default, including: (a) attorney's fees equal to 25 % of the amount of our claim or $1500, whichever is greater; (b) reasonable attorney's fees for getting a repossession order, (c) costs of suit; (d) $250.00 to cover our internal collection overhead; (e) $225.00 to cover our internal repossession and re- marketing overhead if an internal repossession is made or attempted; and (f) all other reasonable out-of-pocket costs. You agree now that the above amounts are good and reasonable predictions of what our actual costs and overhead will be and are not penalties. 17. OPTION TO PURCHASE. Provided you are not in default, upon expiration of the Lease you have the option to purchase all, but not less than all, of the Equipment for $1.00 (plus all sales and other applicable taxes). Upon thirty (30) days written notice, you have the option to purchase the Equipment before the end of the Term by paying an amount equal to the principal portion of the remaining rent plus interest thereon at the Annual Interest Rate set forth above to the date of payment. 18. RETURN OF EQUIPMENT. At the end of the Term if you have not elected to purchase the Equipment pursuant to Section 17, or if you terminate the Lease pursuant to Section 4, or if you are in default and we make a written request, you will, at your expense, return the Equipment to us at a reasonable place to be designated by us. You agree to have the risk of toss during transit. If you fail to return the Equipment within ten (10) days after the end of the Term, you agree that we will have the option of extending the Lease on a month-to-month basis under the same terms as stated in this Lease. You agree to pay us for any damage to the Equipment heyond "ordinary wear and tear". You understand that any person who refuses to return or prevents us from repossessing the Equipment may be personally liable for conversion. 19. ASSIGNMENT; SUBLEASE. BECAUSE THIS LEASE WAS GRANTED TU YUU UN THE STRENvTH OF YOUR OWN CREUIi', YGU AGREE THAT YOU MAY NOT SELL OR ASSIGN (TRANSFER) ANY OF YOUR INTERESTS UNDER THE LEASE TO ANY OTHER PERSON OR SUBLEASE ANY OF THE EQUIPMENT. You agree that we may assign any or all of our interests under this Lease and/or the Equipment to one or more new owner(s) or secured party(ies) at any time without prior notice to you, and such new owner or secured party may also assign its rights. If it happens, you agree that the new owner or secured party will have the same rights we had under this Lease but will not have to perform any of our obligations (in which case we will keep those obligations). You will also agree that the rights of the new owner or secured party will not be subject to any claims, defenses or set-offs that you may have against us or any other person. You agree that any transfer by us would not materially change your obligations under the Lease or substantially increase your risks. 20. PLACE FOR SUIT. You agree that: (A) THIS LEASE WILL BE GOVERNED BY THE LAWS OF THE STATE OF KANSAS (where we maintain our principal office and where this Lease was executed by us); (B) YOU WAIVE TRIAL BY JURY AND CONSENT TO PERSONAL JURISDICTION IN THE STATE AND FEDERAL COURTS IN KANSAS; (C) ANY LEGAL PAPERS FOR ANY LAW SUIT WILL BE PROPERLY SERVED IF MAILED BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, WITH DELIVERY TO EITHER YOU OR YOUR REGISTERED AGENT; and (D) ANY LAW SUIT ARISING OUT OF THIS LEASE, REGARDLESS OF WHO FILES THE SUIT, MUST BE BROUGHT ONLY IN THE STATE OR FEDERAL COURTS IN JOHNSON COUNTY KANSAS AND NOT ELSEWHERE, UNLESS WE AGREE IN WRITING OR ELECT OTHERWISE. 21. LESSEE'S REPRESENTATIONS. You hereby represent and warrant to us that as of the date of this Lease, and throughout the Lease Term: (a) you are the entity indicated in this lease; (b) you are a State or a fully constituted political subdivision or agency of the State in which you are located; (c) you are duly organized and existing under the Constitution and laws of the State in which you are located; (d) you are authorized to enter into and carry out your obligations under this Lease, any document relative to the acquisition of the Equipment and any other documents required to be delivered in connection with this lease (collectively, the "Documents"); (e) the Documents have been duly authorized, executed and delivered by you in accordance with all applicable laws, rules, ordinances and regulations. The Documents are valid, legal, binding agreements, enforceable in accordance with their terms. The person(s) signing the Documents have the authority to do so, are acting with the full authorization of your governing body, and hold the offices indicated with their signatures, each of which are genuine; (f) the Equipment is essential to the immediate performance of a governmental or proprietary function by you within the scope of your authority and shall be used during the Term only by you and only to perform such tunction; (g) you have complied fully with all applicable law governing open meetings, public bidding, debt limitations and appropriations required in connection with this Lease and the acquisition of the Equipment; (h) you shall not do or cause to be done any act which shall cause, or by omission of any act allow, the interest portion of any Rent payment to become includable in gross income for Federal income tax purposes under the Code; (i) you shall comply with the information reporting requirements of Section 149(e) of the Code. Such compliance shall include, but not be limited to, the execution of 8038-G or 8038-GC Information Returns; and (j) all financial information you have provided to us is true and accurate and provides a good representation of your financial condition. YOU HEREBY AUTHORIZE US TO SHARE AND EXCHANGE WITH ANY OF OUR AFFILIATES OR NON-AFFILIATED CREDIT REPORTING AGENCIES CREDIT AND OTHER INFORMATION WE HAVE OBTAINED ON YOU. 22. SEVERABILITY. In the event any provision of this Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 23. EXECUTION IN COUNTERPARTS. This Lease may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Title: Date: 7 / ~~f h/ /;~~ Lease #: 9322892 BLUE ALLEY Member FDIC Q internetmortgage.cDm DOCUMENTATION INSTRUCTIONS , City of Pearland, Texas ACCOUNT NUMBER: 9322892 LENGTH OF CONTRACT : 50 months MONTHLY PAYMENT: $ 1,777.00 Dear Bill Esien: We are pleased to enclose the following documents for required signatures: xx Lease Agreement—Must have original signature with title. Security Agreement/Promissory Note-Must have original signature with title. xx Resolution -To be completed by Secretary/Clerk. xx Insurance assignment request. Personal Guaranty - Please sign where indicated with no title please. xx Delivery and Acceptance (on lease) xx Application xx Other IRS form 8038-GC Instructions for signatures: Proprietorship-Owner signs with a witness. Corporation-One authorized officer with a witness. xx Municipality-One authorized signer with a witness. xx Copy of Driver's License (both signer and witness please). Other Other documents needed: Articles of Incorporation xx Other Tax Exempt Form Please return all copies to BANK OF BLUE VALLEY along with a check drawn to the order of BANK OF BLUE VALLEY in the amount of $1,973.72 which represents the advance payment, documentation fee and/or Security Deposit as specified on the contract. Very truly yours, BANK OF BLUE VALLEY 1110BrALLEY BANK OF BLUE VALLEY PO BOX 26128 Mee mc Q OVERLAND PARK, KS ['Lessor Zip' not recognized] internetmortgage.com war. 913-338-1000 913-338-2898 Fax EQUIPMENT FINANCING APPLICATION B BUSINESS NAME/LESSEE TELEPHONE u City of Pearland, Texas 281-652-1662 EXT S ADDRESS(STREET) (CITY) (STATE) (COUNTY) (ZIP CODE) I 3519 Liberty Dr. Pearland TX 77581 N TYPE OF BUSINESS SIC CODE AGE OF BUSINESS FED.TAX NO. E Municipality ,74-6028909 s LOCATION OF EQUIPMENT(STREET) (CITY) (STATE) (COUNTY) (ZIP CODE) s 3519 Liberty Dr. Pearland TX Brazoria 77581 Business Structure Municipality O PRINCIPAL'S NAME TITLE %OWNERSHIP HOME PHONE NO. SOC.SEC.NO. W N HOME ADDRESS(STREET) (CITY) (STATE) (ZIP CODE) ❑ OWN DRIVERS LIC.NO. E ❑ RENT R PRINCIPAL'S NAME TITLE %OWNERSHIP HOME PHONE NO. SOC.SEC.NO. S H HOME ADDRESS(STREET) (CITY) (STATE) (ZIP CODE) ❑ OWN DRIVER'S LIC.NO. I ❑ RENT p PRINCIPAL'S NAME TITLE %OWNERSHIP HOME PHONE NO. SOC.SEC.NO. HOME ADDRESS(STREET) (CITY) (STATE) (ZIP CODE) ❑ OWN DRIVERS LIC.NO. ❑ RENT BANK BRANCH FAX TELEPHONE ACCOUNT UNDER NAME OF - CHECKING ACCT.NO. ORIGINAL BALANCE CURRENT BALANCE B A BANK BRANCH FAX TELEPHONE N K ACCOUNT UNDER NAME OF CHECKING ACCT.NO. ORIGINAL BALANCE CURRENT BALANCE S BANK BRANCH FAX TELEPHONE ACCOUNT UNDER NAME OF CHECKING ACCT.NO. ORIGINAL BALANCE CURRENT BALANCE COMPANY NAME ACCOUNT NO. TELEPHONE NO. CONTACT PERSON T R A D E S E VENDOR CONTACT Q Phillips Medical Systems Sales Operations u ADDRESS(STREET) (CITY) (STATE) (ZIP CODE) TELEPHONE 1 2301 5th Ave.,Suite 200 Seattle WA 98121 800-263-3342 p EQUIPMENT TO BE FINANCED NI Five(5)HeartStart MRx ALS Monitors together with all present and future attachments,accessories,replacement parts and additions thereto and made a part thereof. N T COST OF EQUIPMENT TERMS OF CONTRACT MONTHLY PAYMENT DUE AT CLOSING $78,265.80 50 months $ 1,777.00 $ 1,973.72 I hereby authorize Bank of Blue Valley or any credit bureau-or other x yA.-1 2-"p23 es investigative agency employed by Bank of Blue Valley to investigate the SIGNATURE DATE references herein listed or statements or other data obtained.from me or from any other person pertaining to my personal and/or business credit x and financial responsibility. SIGNATURE DATE Form 8038-GC ' Information Return for Small Tax-Exempt Governmental Bond Issues, Leases, and Installment Sales OMB No.1545-0720 (Rev. November 2000) ► Under Internal Revenue Code section 149(e) Department of the Treasury Caution: If the issue price of the issue is$100,000 or more, use Form 8038-G. Internal Revenue Service Part I Reporting Authority Check box if Amended Return ► ❑ 1 Issuer's name 2 Issuer's employer identification number City of Pearland,Texas 74 : 60289 9 3 Number and street(or P.O.box if mail is not delivered to street address) Room/suite 3519 Liberty Dr. 4 City,town,or post office,state,and ZIP code 5 Report number Pearland,TX 77581 5 6 Name and title of officer or legal representative whom the IRS may call for more information 7 Telephone number of officer or legal representative Bill Eisen,City Manager ( 281 ) 652-1600 Part II Description of Obligations Check if reporting: a single issue 0 or on a consolidated basis ❑ . 8a Issue price of obligation(s) (see instructions) 8a 78,265.80 b Issue date (single issue) or calendar year (consolidated) (see instructions) 10- 9 Amount of the reported obligation(s) on line 8a: a Used to refund prior issue(s) 9a b Representing a loan from the proceeds of another tax-exempt obligation (e.g., bond bank) . 9b 10 If the issuer has designated any issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check this box . . . ►❑ . 11 If any obligation is in the form of a lease or installment sale, check this box ►0 12 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check this box ►❑ Under penalties of perjury,I declare that I have examined this return and accompanying schedules and statements,and to the best of my knowledge Sign and belief,they are true,correct,and complete. Here al-r- �^23 DSO ,%l , -/n '/I Issuer's authorized representative Date r Type or print name and title General Instructions Thus, an issuer may file a separate Form Other Forms That May Be Required 8038-GC for each of a number of small For rebating arbitrage(or paying a penalty in Section references are to the Internal issues and report the remainder of small lieu of arbitrage rebate)to the Federal Revenue Code unless otherwise noted. issues issued during the calendar year on one government, use Form 8038-T,Arbitrage consolidated Form 8038-GC. However,a Rebate and Penalty in Lieu of Arbitrage Purpose of Form separate Form 8038-GC must be filed to give Rebate. For private activity bonds,use Form Form 8038-GC is used by the issuers of the IRS notice of the election to pay a penalty 8038, Information Return for Tax-Exempt tax-exempt governmental obligations to in lieu of arbitrage rebate. Private Activity Bond Issues. provide the IRS with the information required When To File by section 149(e)and to monitor the Rounding to Whole Dollars requirements of sections 141 through 150. To file a separate return,file Form 8038-GC You may show the money items on this on or before the 15th day of the second return as whole-dollar amounts.To do so, Who Must File calendar month after the close of the drop any amount less than 50 cents and Issuers of tax-exempt governmental calendar quarter in which the issue is issued. increase any amount from 50 to 99 cents to obligations with issue prices of less than To file a consolidated return,file Form the next higher dollar. $100,000 must file Form 8038-GC. 8038-GC on or before February 15th of the • Issuers of a tax-exempt governmental calendar year following the year in which the Definitions obligation with an issue price of$100,000 or issue is issued. ' Obligations.This refers to a single more must file Form 8038-G, Information Late filing.An issuer may be granted an tax-exempt governmental obligation if Form Return for Tax-Exempt Governmental extension of time to file Form 8038-GC under 8038-GC is used for separate reporting or to Obligations. Section 3 of Rev. Proc.88-10, 1988-1 C.B. multiple tax-exempt governmental obligations Filing a separate return. Issuers have the 635, if it is determined that the failure to file if the form is used for consolidated reporting. option to file a separate Form 8038-GC for on time is not due to willful neglect.Type or Tax-exempt obligation.This is a bond, any tax-exempt governmental obligation with print at the top of the form, "This Statement installment purchase agreement,or financial an issue price of less than$100,000. Is Submitted in Accordance with Rev. Proc. lease, on which the interest is excluded from An issuer of a tax-exempt bond used to 88-10."Attach to the Form 8038-GC a letter income under section 103. briefly stating why the form was not finance construction expenditures must file a submitted to the IRS on time.Also indicate Tax-exempt governmental obligation.A separate Form 8038-GC for each issue to whether the obligation in question is under tax-exempt obligation that is not a private give notice to the IRS that an election was examination by the IRS. Do not submit copies activity bond (see below)is a tax-exempt made to pay a penalty in lieu of arbitrage of any bond documents, leases, or installment governmental obligation.This includes a bond rebate(see the line 12 instructions). sale documents. See Where To File below. issued by a qualified volunteer fire Filing a consolidated return.For all department under section 150(e). tax-exempt governmental obligations with Where To File Private activity bond.This includes an issue prices of less than$100,000 that are File Form 8038-GC, and any attachments, obligation issued as part of an issue in which: not reported on a separate Form 8038-GC, with the Internal Revenue Service Center, • More than 10%of the proceeds are to be an issuer must file a consolidated information Ogden, UT 84201% used for any private activity business use, return including all such issues issued within and the calendar year. Cat.No.64108B Form 8038—GC (Rev.11-2000) u 14t ,,?„Fa,E .Tr d PEARLAND i E X A S 8 9 A, CERTIFICATION THE STATE OF TEXAS § COUNTIES OF BRAZORIA, HARRIS, & FORT BEND. § I, Young Lorfing, City Secretary of the City of Pearland, Texas, hereby certifies that the attached constitutes a true and correct copy of Resolution No. R2005-39 duly passed and approved by the City Council on the 14th day of February 2005. Witness my hand and seal of the City of Pearland, Texas, this 24th day of February 2005, at Pearland, Texas. ng Lorf' , R C' Secr ry (SEAL) 3519 LIBERTY DRIVE • PEARLAND,TEXAS 77581-5416 • 281-652-1600 • www.ci.pearland.tx.us CO Printed on Recycled Paper �BLt Membe FDIC Cr internetmortgage.com mho Bank of Blue Valley - CEFD P.O. Box 26128 Overland Park, KS. 66225 Phone: (913) 338-1000 Fax: (913) 338-2898 INVOICE Customer Name City of Pearland, Date: February 22, 2005 Texas Invoice # 9322892-001 Address 3519 Liberty Dr. Address City State Zip Pearland, TX 77581 Contact: Bill Esien Date Due Upon Receipt Phone 281-652-1662 Quantity Description TOTAL Advance Security Documentation Account Payment Please Bank Attn: PO Overland Box remit Blue 26128 Payment(s) Deposit: #9322892 is due a Valley check Fees: upon KS 66225-6128 Due: receipt payable to: $1,798.72 $0.00 $175 00 of CEFD Park, Payment Details Total: $1,973.72 Cash C Check ❑ CERTIFICATION AND RESOLUTION Young Lorfi ng , do hereby certify that I am the duly elected, or appointed and acting Secretary/Clerk of the City of Pearland, Texas an agency duly organized and existing under the laws of the State of TX (the "Lessee"), and that the following resolutions have been presented to and duly adopted by the City of Pearland, Texas at a. meeting duly and regularly held and convened in accordance with applicable law on the 14th day of February 200 5 WHEREAS, the Lessee is entering a Plain Language Municipal Lease ("Lease") dated February 23rd , 2005 with Bank of Blue Valley; WHEREAS, the Lessee has determined that a true and very real need exists for the Equipment described on the Lease; WHEREAS, Lessee has carefully reviewed its financing requirements for the current calendar year and reasonably expects that it will not issue more than ten million dollars ($10,000,000) of tax exempt obligations during the calendar year; NOW, THEREFORE BE IT RESOLVED, that the Lessee be, and hereby is, authorized to enter into the Lease with Bank of Blue Valley, and be it further RESOLVED, that Lessee designates and authorizes the following person(s) to execute and deliver the Lease and any related documents on Lessee's behalf necessary for the completion of the transaction, Authorized Individual: Willi am Eisen Title: City Manager (Print Name) Authorized Individual: Title: and be it further (Print Name) RESOLVED, that pursuant to Section 265 (b) (3) of the Internal Revenue Code of 1986, amended, this Lease be and hereby is designated a 'qualified tax-exempt obligation" included within the ten million dollars ($10,000,000) of the aggregate issues designated as "qualified tax- exempt obligations" for the calendar year within which this Lease is entered into, and be it further RESOLVED, that Lessee shall not designate more than ten million dollars ($10,000,000) of tax-exempt obligations during the current calendar year as qualified tax exempt obligations and Lessee, together with its subordinate entities does not reasonably expect to issue more than ten million dollars ($10,000,000) of tax exempt obligations during the current calendar year. IN WITNESS WHEREOF, I have duly executed this certification and resolution and affixed the seal hereto this 23rd day of February 200®‘sell°Ilesaeee�� �P R ra A LA / a • Lessee: City of Pearland, e 1 % •• / Te s o" Air .A��..f . Ae Addle st✓� e . q� Ci t /e e' , •:0 • CD r. • s • • • y 014, •••••• F4, Print Nark, & Title: Secrtpt`ary aeeeell11I At4in° ST BLUE AI41,EY internetmortgage.com t;oia February 22, 2005 From: City of Pearland, Texas 3519 Liberty Dr Pearland, TX 77581 To: Denise Gotwald Agent Name: Agent Address: P.O. Box 149194 City: Austin State: TX Zip: 78714-9194 Agent Phone #: 800-537-6655 Agent Fax #. (512) 491-2311 Re: Insurance Verification Request Greetings: We have entered into a financing agreement with Bank of Blue Valley for the following equipment with a value of $78 265.80. Five (5) HeartStart MRx ALS Monitors together with all present and future attachments, accessories, replacement parts and additions thereto and made a part thereof. EQUIPMENT LOCATION: 3519 Liberty Dr. Pearland, TX 77581 We are responsible for the cost as well as providing the coverage as identified below. Please see that we have immediate coverage and notify Bank of Blue Valley at once in the form of a COPY OF THE INSURANCE POLICY OR A CERTIFICATE OF INSURANCE. If the certificate is sent, please include therein the standard 30 day notice of cancellation clause XX PHYSICAL DAMAGE: Insurance is to be provided for fire, theft, extended coverage, vandalism and malicious mischief for the full value of the equipment. Bank of Blue Valley is to be named as LOSS PAYEE AS ITS INTERESTS MAY APPEAR. XX GENERAL LIABILITY: Coverage should be written with minimum limit of $1,000,000 per occurrence. Bank of Blue Valley is to be named as ADDITIONAL INSURED. If you have any questions, please do not hesitate to call: Sincerely, City of Pearland, Texas h Bank of Blue Valley - Commercial Equipment Finance Department P. O. Box 26128 Overland Park, KS. 66225-6128 (913) 338-1000 Fax: (913) 338-2898 Lease Agreement — continued 8. IMPORTANT CONDITIONS. You understand and agree that: (A) YOU ARE UNCONDITIONALLY OBLIGATED TO PAY ALL LEASE PAYMENTS AND OTHER AMOUNTS DUE IN ALL FISCAL YEARS IN WHICH FUNDS HAVE BEEN APPROPRIATED NO MATTER WHAT HAPPENS, EVEN IF THE EQUIPMENT IS DAMAGED OR DESTROYED, IF IT IS DEFECTIVE, OR IF YOU CAN NO LONGER USE IT. (B) WE ARE LEASING THE EQUIPMENT TO YOU "AS IS" AND WE HAVE MADE NO REPRESENTATION, GUARANTEE OR WARRANTY, EXPRESS OR IMPLIED (INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE), REGARDING THE EQUIPMENT. WE DISCLAIM ALL SUCH WARRANTIES OR GUARANTEES OF ANY KIND, INCLUDING COMPLIANCE WITH ALL YEAR 2000 ISSUES. WE AGREE TO TRANSFER TO YOU ALL WARRANTIES, IF ANY, MADE BY THE VENDOR TO US. (C) WE WILL NOT BE LIABLE FOR ANY LOSS OR INJURY TO YOU OR ANY OTHER PERSON OR PROPERTY (including lost profits and consequential, incidental or special damages) CAUSED BY THE EQUIPMENT OR ITS FAILURE TO OPERATE. (D) To the extent permitted by applicable law, YOU WAIVE ANY AND ALL RIGHTS AND REMEDIES YOU HAVE UNDER ARTICLE 2A (Sections 508-522) OF THE UCC, INCLUDING BUT NOT LIMITED TO YOUR RIGHTS TO : (I) cancel or repudiate the Lease; (II) reject or revoke acceptance of the Equipment; (iii) grant a security interest in the Equipment; (iv) accept partial delivery of the Equipment; (v) "cover" by making any purchase or lease of substitute equipment; (vi) seek specific performance against us; and (vii) recover damages from us for any breaches of warranty or for any other reason. If any provision of this Lease or the application thereof shall be held to be invalid or unenforceable, the same shall not affect in any respect whatsoever the validity or the application of any other provision of this Lease. (E) YOU UNDERSTAND THAT WE AND THE VENDOR ARE TWO SEPARATE AND INDEPENDENT COMPANIES, AND THAT NEITHER THE VENDOR NOR ANY OTHER PERSON IS OUR AGENT. YOU AGREE THAT NO REPRESENTATION, GUARANTEE OR WARRANTY BY THE VENDOR OR OTHER PERSON IS BINDING ON US, AND NO BREACH BY THE VENDOR OR OTHER PERSON WILL EXCUSE YOUR OBLIGATIONS TO US. YOU ALSO UNDERSTAND THAT ONLY OUR OFFICER IS AUTHORIZED TO WAIVE OR ALTER ANY OF THE TERMS OF THIS LEASE AND THAT ANY SUCH WAIVER OR ALTERATION MUST BE IN WRITING. (F) IF THE EQUIPMENT DOES NOT WORK AS REPRESENTED BY THE VENDOR, OR IF THE VENDOR OR ANY OTHER PERSON FAILS TO PROVIDE ANY SERVICE, OR IF THE EQUIPMENT IS UNSATISFACTORY FOR ANY OTHER REASON, YOU WILL MAKE ANY CLAIM SOLELY AGAINST THE VENDOR OR OTHER PERSON AND WILL MAKE NO CLAIM AGAINST US. 9. REPAIRS AND SERVICE. You understand that we are not responsible for repairs or service to the Equipment. You will use the Equipment in the manner for which it was intended, keep the Equipment in good condition and will service the Equipment as and when needed. All replacement parts and additions to the Equipment will become our property: 10. USE. You certify that the Equipment will be used solely for governmental use during the duration of this lease and in a manner complying with all applicable federal, state and local laws and regulations. You will not permit the equipment to be used in or for any private commercial activity. You will not (a) make any alterations to the Equipment; (b) allow it to be used by anyone but your employees; or (c) move it to any other location without our written permission. You will not attach the Equipment to any real estate. 11. RISK OF LOSS; DAMAGE; INSURANCE. You are responsible for any loss, destruction or damage to the Equipment from any cause at all, whether or not insured, from the time the Equipment is shipped to you until it is returned to us. NO SUCH LOSS OR DAMAGE SHALL IMPAIR YOUR OBLIGATIONS UNDER THIS LEASE WHICH SHALL CONTINUE IN FULL FORCE AND EFFECT. You will keep the Equipment insured against all risks of loss in an amount not less than the replacement cost, and will list us as the loss payee. If requested, you will also carry public liability insurance listing us as additional insured in amounts acceptable to us. You agree to provide us with satisfactory written evidence of all such insurance and you agree to give us twenty (20) days prior written notice of any cancellation of any insurance. YOU AGREE THAT IF YOU FAIL TO OBTAIN SUCH INSURANCE, WE MAY (BUT ARE NOT OBLIGATED TO) OBTAIN IT AND CHARGE YOU A FEE IN WHICH CASE, WE WILL BE THE SOLE INSURED PARTY AND YOU WILL HAVE NO RIGHTS UNDER THE INSURANCE POLICY. YOU HEREBY GIVE US POWER OF ATTORNEY TO APPLY FOR INSURANCE BENEFITS AND TO ENDORSE CHECKS RECEIVED IN PAYMENT. 12. TAXES AND OTHER FEES. You understand that this is a "net" lease and agree to pay us upon demand for all taxes, If any (including sales, use, personal property and other taxes) and other fees of any kind which may be charged regarding the leasing, use or ownership of the Equipment. 13. INDEMNITY. You agree to defend us against and indemnify (reimburse) us. for all claims, liabilities, losses, damages, costs and legal fees arising out of the manufacture, purchase, ownership, leasing, use or possession of the Equipment, including claims for property damage or injuryto persons. This promise will continue after the end of the Term. 14. TITLE. Unless otherwise required by the laws of the state where you are located, you shall have title to the Equipment immediately upon delivery and shall be deemed to be the owner of the Equipment as long as you are not in default under this lease. In the event of a default or non -appropriation, title to the Equipment shall revert to us free and clear of any rights or interests you may have in the Equipment. YOU HEREBY GIVE US POWER OF ATTORNEY TO SIGN AND FILE FINANCING STATEMENTS. YOU AGREE TO PAY OUR FILING AND OTHER ADMINISTRATIVE AND PROCESSING FEES. You hereby grant to us a security interest in the Equipment and agree that the financing statements will create a perfected security interest in our favor. You will not allow any other liens or encumbrances to be placed on the Equipment. 15. DEFAULT. You agree that we may declare you in default if you (a) fail to make any payment for a period of twenty (20) days after the due date; (b) do not comply with any other term in this Lease or any other agreement you have with us; (c) any action is brought against you causing the Equipment to be taken or encumbered; (d) you become insolvent, make or consent to an assignment for the benefit of creditors, file or have filed against you a bankruptcy, sell all or substantially all of your assets, make or consent to the appointment of a receiver or trustee; (e) the Equipment or any part of it is abused, illegally used, misused, lost, destroyed or damaged beyond repair; or (f) any insurance carrier cancels or threatens to cancel any insurance on the Equipment. If any of these defaults occurs, you agree that we may take one or both of the following actions, in addition to other actions available under law: (A) terminate the Lease and/or sue for (I) any and all amounts which may be then due and payable by you to us under this Lease, plus (b) all rent payments remaining through the end of the then current fiscal year, and (ii) the costs listed in Section 16 below; AND (B) enter the Equipment site, without any court order or other process of law, and repossess the Equipment, or render the Equipment unusable without removal, or sue for a repossession court order. You agree to waive any trespass or right of action for damages as a result of our actions to enter, repossess and/or disable the Equipment. Following repossession: (a) all of your rights to the Equipment will end; (b) we may re -market the Equipment without advance notice to you; and (c) we may also sue for the amounts listed in 15(A) above without first re- marketing the Equipment. You agree that we are not required to repossess and re -market the Equipment, and you waive any rights under any law that provide otherwise. 16. RECOVERY COSTS. You agree to pay all of our recovery costs after a default, including: (a) attorney's fees equal to 25% of the amount of our claim or $1500, whichever is greater; (b) reasonable attorney's fees for getting a repossession order; (c) costs of suit; (d) $250.00 to cover our internal collection overhead; (e) $225.00 to cover our internal repossession and re- marketing overhead if an internal repossession is made or attempted; and (f) all other reasonable out-of-pocket costs. You agree now that the above amounts are good and reasonable predictions of what our actual costs and overhead will be and are not penalties. 17. OPTION TO PURCHASE. Provided you are not in default, upon expiration of the Lease you have the option to purchase all, but not less than all, of the Equipment for $1.00 (plus all sales and other applicable taxes). Upon thirty (30) days written notice, you have the option to purchase the Equipment before the end of the Term by paying an amount equal to the principal portion of the remaining rent plus interest thereon at the Annual Interest Rate set forth above to the date of payment. 18. RETURN OF EQUIPMENT. At the end of the Term if you have not elected to purchase the Equipment pursuant to Section 17, or if you terminate the Lease pursuant to Section 4, or if you are in default and we make a written request, you will, at your expense, return the Equipment to us at a reasonable place to be designated by us. You agree to have the risk of loss during transit. If you fail to return the Equipment within ten (10) days after the end of the Term, you agree that we will have the option of extending the Lease on a month -to -month basis under the same terms as stated in this Lease. You agree to pay us for any damage to the Equipment beyond "ordinary wear and tear. You understand that any person who refuses to return or prevents us from repossessing the Equipment may be personally liable for conversion. 19. ASSIGNMENT; SUBLEASE. BECAUSE THIS LEASE WAS GRANTED TO YOU ON THE STRENGTH OF YOUR OWN CREDIT, YOU AGREE THAT YOU MAY NOT SELL OR ASSIGN (TRANSFER) ANY OF YOUR INTERESTS UNDER THE LEASE TO ANY OTHER PERSON OR SUBLEASE ANY OF THE EQUIPMENT. You agree that we may assign any or all of our interests under this Lease and/or the Equipment to one or more new owner(s) or secured party(ies) at any time without prior notice to you, and such new owner or securedparty may also assign its rights. If it happens, you agree that the new owner or secured party will have the same rights we had under this Lease but will not have to perform any of our obligations (in which case we will keep those obligations). You will also agree that the rights of the new owner or secured party will not be subject to any claims, defenses or set -offs that you may have against us or any other person. You agree that any transfer by us would not materially change your obligations under the Lease or substantially increase your risks. 20. PLACE FOR SUIT. You agree that: (A) THIS LEASE WILL BE GOVERNED BY THE LAWS OF THE STATE OF KANSAS (where we maintain our principal office and where this Lease was executed by us); (B) YOU WAIVE TRIAL BY JURY AND CONSENT TO PERSONAL JURISDICTION IN THE STATE AND FEDERAL COURTS IN KANSAS; (C) ANY LEGAL PAPERS FOR ANY LAW SUIT WILL BE PROPERLY SERVED IF MAILED BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, WITH DELIVERY TO EITHER YOU OR YOUR REGISTERED AGENT; and (D) ANY LAW SUIT ARISING OUT OF THIS LEASE, REGARDLESS OF WHO FILES THE SUIT, MUST BE BROUGHT ONLY IN THE STATE OR FEDERAL COURTS IN JOHNSON COUNTY KANSAS AND NOT ELSEWHERE, UNLESS WE AGREE IN WRITING OR ELECT OTHERWISE. 21. LESSEE'S REPRESENTATIONS. You hereby represent and warrant to us that as of the date of this Lease, and throughout the Lease Term: (a) you are the entity indicated in this lease; (b) you area State or a fully constituted political subdivision or agency of the State in which you are located; (c) you are duly organized and existing under the Constitution and laws of the State in which you are located; (d) you are authorized to enter into and carry out your obligations under this Lease, any document relative to the acquisition of the Equipment and any other documents required to be delivered In connection with this lease (collectively, the "Documents"); (e) the Documents have been duly authorized, executed and delivered by you In accordance with all applicable laws, rules, ordinances and regulations. The Documents are valid, legal, binding agreements, enforceable in accordance with their terms. The person(s) signing the Documents have the authority to do so, are acting with the full authorization of your governing body, and hold the offices indicated with their signatures, each of which are genuine; (f) the Equipment is essential to the immediate performance of a governmental or proprietary function by you within the scope of your authority and shall be used during the Term only by you and only to perform such function; (g) you have complied fully with all applicable law governing open meetings, public bidding, debt limitations and appropriations required in connection with this Lease and the acquisition of the Equipment; (h) you shall not do or cause to be done any act which shall cause, or by omission of any act allow, the interest portion of any Rent payment to become includable in gross income for Federal income tax purposes under the Code; (i) you shall comply with the information reporting requirements of Section 149(e) of the Code. Such compliance shall Include, but not be limited to, the execution of 8038-G or 8038-GC Information Returns; and (j) all financial information you have provided to us is true and accurate and provides a good representation of your financial condition. YOU HEREBY AUTHORIZE US TO SHARE AND EXCHANGE WITH ANY OF OUR AFFILIATES OR NON-AFFILIATED CREDIT REPORTING AGENCIES CREDIT AND OTHER INFORMATION WE HAVE OBTAINED ON YOU. 22. SEVERABILITY. In the event any provision of this Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. 23. EXECUTION IN COUNTERPARTS, This Lease may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. ACCEPTED BY LESSOR By: Title: Date: Lease #: 9322892 DEPARTMENT DRI V CLASS: C DL: DOB:06-27-52 HTS- EXPIRES: 06-27-07 avf'lt _ REST:A SE..r END ? ,.� EISEN,WILLIAM RA • TEXAS DEPARTMENT OF PUBLIC SAFETY DRIVER LICENSE CLASS:C DL: DOB: Q3-26-55 EXPIREtS:.03-26-07 REST: A END HT: 6-02 EYES BRN SEX: NI LORFING MELVIN YOUNG