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<br />services performing functions similar to the functions of the Equipment,
<br />and, it this Lease terminates pursuant to t.. <)ection. Lessee agrees
<br />Ihat during the fiscal period Immediately" ,Ing the fiscal period in
<br />which such termination occurs it will not so purchase, lease, rent or
<br />otherwise acquire the use of any such other equipment or services.,
<br />
<br />7. REPRESENTATIONS, COVENANTS AND WARRANTIES.
<br />Lessee represenls, covenants and warrants as of Ihe date hereof and
<br />at all limes during the Lease Term that: (i) Lessee is a state or a fully
<br />constituted political subdivision thereof, or Us obligations hereunder
<br />conslltute obligations issued on behalf of a state or a political subdivision
<br />thereof, such Ihet any Interest derived under this lease will qualify for
<br />exemption Irom Federal income taxes under section 103 of the Internal
<br />Revenue Code of 1986, as amended (the "Code"). and that it will do
<br />or cause 10 be done all things necessary to preserve and keep in lull
<br />lorce end effecl (a) ils existence and (b) this lease; (ii) the execution,
<br />delivery and performance by the lessee of this lease and all documents
<br />executed in connection herewith, including, withoullimitation, Schedule
<br />A herelo and Ihe Delivery and Acceptence Certificate referred to in
<br />Section 3 hereof (the Lease together with all such documents shall be
<br />collectively referred to herein 85 the "Lease Documents") have been
<br />duly authorized by all necessary action on the part of the lessee; (Iii)
<br />the lease Documents each constitute a legal, valid and binding
<br />obligation of the Lessee enforceable in accordance with their respective
<br />terms; (iv) no additional governmental orders, permissions, consents,
<br />approvals or authorizations are required to be obtained and no
<br />registrations or declarations are required to be filed in connection with
<br />Ihe execution and delivery of the Lease Documents; (v) lessee has
<br />sufficient appropriations or other funds available to pay all Lease
<br />Payments and other amounts due hereunder for the current tiscal
<br />period; (vi) Ihe use of the Equipment by lessee is essential to and will
<br />be limited to the performance by lessee of one or more governmental
<br />funcllons 01 lessee consistent with the permissible scope of lessee's
<br />authority; (vii) no portion 01 the Equipment will be used directly or
<br />Indirectly in any trade or business carried on by any person olher than
<br />Lessee; and (viii) no portion of the Equipment will be used by an
<br />organization described in section 501 (c) (3) olthe Code and (ix) this
<br />Lease does not constitute an arbitrage obligation within the meaning
<br />of section 148 of the Code and is not federally guaranteed within the
<br />meaning 01 section 149(b) of the Code.
<br />lessee shall deliver to lessor an opinion of Lessee's counsel in form
<br />and substance as setlorth herein or as otherwise acceptable to lessor.
<br />In the event that a question arises as to Lessee's qualification as a
<br />palillcal subdivision, Lessee agrees to execute a power of attorney
<br />authorizing Lessor to make application to the Internal Revenue Service
<br />for a letter ruling with respect to the issue.
<br />
<br />8. TITLE TO EQUIPMENT. Upan acceptance of the Equipment by
<br />lessee hereunder, title to the Equipment will vest in lessee subjecl
<br />to lessor's rights under this lease; provided, however. Ihat (i) in Ihe
<br />event of termination of this Lease pursuant to Section 6 hereof, (Ii) upan
<br />the occurrence of an Event of Default hereunder, and as long as such
<br />Event 01 Default is continuing, or (Iii) in the event Ihat the purchase
<br />option has not been exercised prior to the Expiration Date, title will
<br />immedialely vest in lessor or Its assignee without any action by lessee
<br />and Lessee shall immediately surrender possession of the Equipment
<br />to Lessor or its assignee in the manner set forth in Section 5 hereof.
<br />
<br />9. USE; REPAIRS. Lessee will use the Equipment in a carelul manner
<br />for Ihe use contemplated by the manufacturer of the Equipment. lessee
<br />shall comply with all laws, ordinances, insurance policies and
<br />regulations relating to the possession, use, operation or maintenance
<br />of the Equipment. lessee, at its expense, will keep the Equipment in
<br />good working order and repair and furnish all parts, mechanisms and
<br />devices required therefor.
<br />
<br />10. ALTERATIONS. Lessee will not make any alterations, additions
<br />or Improvemenls to the Equipment without Lessor's prior written
<br />consenl unless such alterations, additions or improvements may be
<br />readily removed without damage to the Equipment.
<br />
<br />11. L,-,~." ,IN; INSPECTION. The Equipment will not be removed
<br />from or, if the Equir "t consists of rolling stock, its permanent base
<br />will not be changed " the Equipment Location without Les~r's prior
<br />written consent which will not be unreasonably withheld. lessor will
<br />be entitled to enter upon the Equipment location or elsewhere during
<br />reasonable business hours to inspect the Equipment or observe its use
<br />and operation.
<br />
<br />12. LIENS AND TAXES. Lessee shall keep the Equipment free and
<br />clear of all levies, liens and encumbrances except those created under
<br />this lease. lessee shall pay. when due. all charges and taxes (local,
<br />stale and federal) which may now or herealter be imposed upon the
<br />ownership, leasing, rental, sale, purchase, posseSSion or use of the
<br />Equipment, excluding however, all taxes on or measured by Lessor's
<br />income. II Lessee fails to pay said charges, or taxes when due, lessor
<br />may, but need not, pay said charges or taxes and, in such evenl, Lessee
<br />shall reimburse Lessor therefor on demand, with interest at the
<br />maximum rale permitted by law Irom the dale of such paymenl by
<br />Lessor 10 the date of reimbursement by Lessee.
<br />
<br />13. RISK OF LOSS; DAMAGE; DESTRUCTION. Lessee assumes
<br />all risk of loss of or damage 10 the Equipmenl from any cause
<br />whatsoever, and no such loss ot or damage to the Equipment nor defect
<br />therein nor unfitness or obsolescence thereof shall relieve Lessee of
<br />the obligation to make Lease Payments or to perform any other
<br />obligation under this Lease. In the event of damage to any item of
<br />Equipmenl. lessee will immediately place the same in good repair with
<br />the proceeds of any insurance recovery applied to the cost of such
<br />repair. If lessor determines thai any ilem of Equipment is lost, stolen,
<br />destroyed or damaged beyond repair, Lessee, at the option of Lessor,
<br />will either (a) replace the same with like equipment In good repair, or
<br />(b) on the next lease Payment Date. pay lessor: (I) all amounts then
<br />owed by lessee to lessor under this lease, including the Lease
<br />Payment due on such date, and (Ii) an amount equal to the applicable
<br />Conciuding Payment set forth in Schedule A opposite such Lease
<br />Payment Date. In the event that Lessee is obligated to make such
<br />paymenl pursuant to subparagraph (b) above with respect to less than
<br />all of the Equipment, Lessor will provide Lessee with the pro rata amount
<br />of the Lease Payment and the Concluding Payment to be made by
<br />Lessee with respect to the Equipment which has suffered the event
<br />of loss.
<br />
<br />14. PERSONAL PROPERTY. The Equipment is and will remain
<br />personal property and will not be deemed to be affixed or attached to
<br />real eslale or any building thereon. If requested by Lessor, lessee will,
<br />at Lessee's expense, furnish a waiver of any interest In the Equipment
<br />from any party having an interest in any such real estate or building.
<br />
<br />15. INSURANCE. lessee, will, at its expense, maintain at all limes
<br />during the lease Term, fire and extended coverage, pUblic liability and
<br />property damage insurance wilh respect 10 the Equipment in such
<br />amounts, covering such risks, and with such insurers as. shall be
<br />satisfactory to Lessor, or, with Lessor's prior written consent, may self.
<br />insure against any or all such risks. In no event will the insurance limits
<br />be less than the amounl of Ihe then applicable Concluding Payment
<br />with respect to such Equipment. Each insurance policy will name
<br />Lessee as an insured and Lessor or its assigns as an additional insured.
<br />and will contain a clause requiring the insurer to give Lessor or Its
<br />assigns at least Ihirty (30) days prior written notice 01 any alteralion
<br />in the terms of such policy or the cancellation thereof. The proceeds
<br />of any such policies will be payable to Lessee and Lessor or its assigns
<br />as their interests may appear. Upon acceptance of the Equipment and
<br />upon each insurance renewal date, Lessee will deliver to Lessor a
<br />certificate evidencing such insurance. In the event that Lessee has been
<br />permitted to self.insure, Lessee will furnish Lessor with a letter or
<br />certificate to such effect. In the event of any loss, damage, injury or
<br />accidenl involving the Equipment, Lessee will promptly provide Lessor
<br />with written notice thereof and make av~ilabie to Lessor all information
<br />and documentation relating thereto and shall permit lessor to
<br />participate and cooperate with Lessee in making any claim for Insurance
<br />in respect thereof.
<br />
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