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<br />FROM :~SSOCI~TES DETROIT
<br />
<br />;02 TO
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<br />sorvices per10rming function, similar to the funcUons of the Equipment,
<br />and. it this Leaso termInate, pursuant to this S.ctlon. LeSle. agrees
<br />that during th. fiscal pariOd immedlataly following the flacal p.rlo~ in
<br />which such t.rmlnation occurs it will not so purChase, I.ua, ranI or
<br />othelWis. aCQulr. the usa of any luch Olh.r eQulpmanl or a.l'\lic.s,
<br />
<br />7. REPRESENTATIONS, COVENANTS AND WARRANTIES,
<br />lessee represents. covonants and warrants as of the dale heraof and
<br />at all timos during the lease Term that: (I) Le,... is A at.te or a fully
<br />conSlltul.d political aubdivislon thereof, 0' ils obligations heraunder
<br />constltut. obligation. I..uad on behaH of a stat. Of a pollllcal .ubdivlslon
<br />thareof, .uch Ihat any Int.r..t d.rlv.d under thiS L.ase will Qualify tor
<br />.xemptlon from Federal income taxas under taction' 03 of Ihe Internol
<br />Rev.nu. Cod. of ,9S6, as amondad (the "COde"), and thaI It will do
<br />or cau.. to b. done all things neco.sary to p",..",o and k.op in full
<br />force and eff.ct (a) It. existence and (b) this Lea.e: (II) the exeeullon,
<br />delivery and p.r1ormanee by th. L...ee 01 this Leue and all documents
<br />ex""utM in connection herewith, Including, without IImll.llon, Soh.dul.
<br />A hereto and the O.liv.ry and Acceptanca C.rtiflcata r.farred 10 In
<br />Section 3 hereof (the L.... together with all such dooumoOls shall be
<br />collectively rofQ((ed to hareln BS the .jleaa9 Documentsl') have been
<br />dUly authorlze~ by all necasury action on the part Of the Leaseo: (III)
<br />\h. "ea.. Documanl8 eoch consUtuto a legal, valid .nd binding
<br />Obligation of the LessAI!I Anforeeable In accordance with their respeolive
<br />lerms: (Iv) no additional governmental orders, perml.slons, consents,
<br />epprov.ls or authorizations are re~ulred to b. obtalnad and no
<br />. regislralions Or declarations ars required to be flied In connection with
<br />the ..ecu'ion and dollvery of tho Loaao Documents; (v) Le.sea hao
<br />sufficlanl appropriations or othor funds available to pay all Lease
<br />PaymOnls and other amounts due hereunder for Ihe current fiscal
<br />parlod; (vi) tho uso of the Equlpm.nt by Le....I. ..s.nU.I'o ond will
<br />be IImlled to the performance by Lessee 01 one or more governmental
<br />functions of Lessea consistent with the perml..lble scope of L.....'.
<br />authority; (vII) no portion of tho E~ulpmant will be used directly Or
<br />indirectly In eny trede or business carrl.d on by any parson other than
<br />Le.s.e; and <vIII) no portion of the E~ulpm.nt will be u.ed by .n
<br />org.niz..ion d.scrlb.d in ..cUon 501 (0) (3) of th. Code and (Ix) this
<br />Lease does not constitute ah arbitrage obllgi!tlon within the meaning
<br />of .ectlon ,.e of Ihe Cod. and Is not fedaraliy guerantaed within the
<br />meaning of SeOtion 149(b) 01 the COde,
<br />Les... .hall d.llver to Lessor an opinion of Less.e'. counsel In form
<br />and 9ubslance 81881 forth herein or as otherwlle acceptable to Le$$or.
<br />In In. avenl thet a quesUon arises 1$ to Lessee'. qualification as a
<br />pclltical SUbdivision. L.ss.a egrees 10 exacute a power Of attorney
<br />eulhorizin; Lessor 10 make application to the Internal Revenue Sel'\lioe
<br />for a letter ruling with respect to the Issue.
<br />
<br />6, TITLE TO EQUIPMENT, Upon acceplance of tho Equlpmont by
<br />LesleR hereunder I title to the Equipment wlll veSl In Lessee subject
<br />10 Lessor's rights und.r this La.se; provided, howav.r, that (I) In tha
<br />aven. Of t.rmination at this L.ase pursuant to Sactlon 6 he rOOf, (iI) upon
<br />the occurrence of en Event of Default hereunder, and es long as SUch
<br />Event of D.fault i. continuing, or (ill) In the event that the purchase
<br />option has not b..n .xerciseo prior to Iha Explrellon Date, Iltl. will
<br />Immadlately vast In L.ssor or Its .ssignoo without ony action by Las$Ba
<br />and "essee shall Immediately surrender possesSion Of the EqUipment
<br />10 Lessor or lis a..ign.e in Iho manner $8t forth In Seclion 5 hereol.
<br />
<br />9, USE; REPAIRS, L.ssee will uSQ tha Equipment In a caroful menn.,
<br />lor the use contemplated by the manufacturer of lhe Equipment. LeBsee
<br />.hell comply wllh all I.ws. ordinance., Insuranc. pollci.. and
<br />'egulations relallng to the possession. use, ope'atlon or m.lntenence
<br />of lhe Equipment. Lessea, at It. exponse, will keep the Equipment In
<br />good working order .nd ropalr .nd furnish .11 p.rts, m.chanisms .nd
<br />device. required thorefor,
<br />
<br />10, ALTERATIONS, Lassoo will not make eny .lIerallons, additions
<br />or improvemenlS 10 the Equipment without leslor', prior wrinen
<br />Consent unless such alt.r.tlons. additions or Improvements mllY be
<br />readily removed wl1hout dame.ge to the tQulpmenl.
<br />
<br />2147858519
<br />
<br />.991, 11-11
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<br />06:04PM ~408 P.08/1S
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<br />11, LOCATION; INSPECTION, Th. Equlpm.nt will nOI bo r.movec!
<br />from or, If Ihe Equipment con lilts of relling stock, its permanent base
<br />wilr not be changed from th~ equIpment Location without Le5~r's pnor
<br />written consent whiCh wIll not be unr"asonably withheld. Lessor wUl
<br />be antllled to enter upon the E~ulpment Location or aleewhere ~lInn9
<br />reasonable bu~lnoss hours 10 in.peet the Equipment or observe liS USe
<br />and op.rallon,
<br />
<br />, 2, LIENS AND TAXES, ".I....hall k..p tho Equiomont froo .nd
<br />clear of alllevfe,. liens and encumbranoes 9lCcept lhasa creal9<1 und~r
<br />thl. Laa.., L.ssee sh.1I p.y, whon duo, all charge. .nd taxas (local,
<br />stato and federal) whloh may now or hereefter be impoaad upon the
<br />ownership, leasing, rental. sale, purch.50, poss.sslon or use of the
<br />Equlpm.nt, .xoluding however, all laxes on or m.asured by Lessor'.
<br />income, If L..s.. falls to p.y said cherges, or taxes when due, L.ssor
<br />may, but need not, pay said charge. or taxes and. in such event, Lessee
<br />shall ralmburaa L...or th.refor on demand. with interest .t the
<br />maximum rate permitted by law from Ihe date of such payment by
<br />Lessor to tt-.o data of reimbura9ment by Lessee.
<br />
<br />13, RISK OF LOSS; DAMAGE; DESTRUCTION, Lessee ..sllmas
<br />all riak of loss of or damage to the Equipment from any causa
<br />Whatsoever, and no luch Ioos 01 or damoge to Ihe E~uipm.nt nor defect
<br />therein nor unfitness or Obsolescence theruof shall relieve Lessee- of
<br />the obligation \0 make Leasa peyments Or to porform eny other
<br />obligation unde, this Leaae. In the evenl of ~amogo to any item of
<br />Equipment, L....e wllllmmedlalely piece the same in good repslr with
<br />the prooDods of any insuranoe recovery applied lO the cost 0: such
<br />r.palr, If Lassor determin..that any Item of Equipment Is lost, stol.n.
<br />destroyed or damaged beyond repair, Les.~e, althe option of La..o"
<br />wilt either (a) replace Ihe ..me with like equipment In gOOd repair, or
<br />(b) on the n.~t Leas. Payment Dat., pay l,0ssor: (I) all amount. thAn
<br />owed by Lessae to Lessor under this Leese, including the L...e
<br />Payment due on such date, and (II) an amount equal 10 the appllc.bie
<br />Concluding Payment s61 fonh In Schedule A opposite such Lease
<br />Payment D8te. In the event that Lessee Is obligated to make such
<br />payment purouant 10 subparagraph (b) Abov. with rasp..t to l.sa thAn
<br />all of th. Equipment, Leosor will provide Lossee with the pre rata amount
<br />01 tha Lease Paym.nt and the Concluding Payment to be made by
<br />lesseD with respoot to the Equipment whioh has suffored the evant
<br />OIIOS$,
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<br />14"PERSONAL PROPERTY, The Equipment Is end will remain
<br />personal property and will not be daemed to be affixed or attached to
<br />realestole or any building thereon, If requested by Lossor, Lossoo will,
<br />at L.ssee'. .xpens., furnish a wolv.r of any InW..t In thO Fqulpm001
<br />from any party having an Inter..t In any suoh ro.1 aslato or building.
<br />
<br />15. INSURANCE. Lessee, wlll, at Its ex~)enSf3, maintain at all times
<br />during tha La.s. T.rm, fir. and extandad coverage, public Ilobility nnd
<br />property ~amago Insurance with respect to Ihe Equipment In sucli
<br />amounts, covering such risks, and with such Insurers as shall bo
<br />satisfactory to La..or, 0', with Lessor's prior writton consent, may .all-
<br />insure against any or aUauch risk.. In no event wlll the Insurance limits
<br />b. less then the amount of tha Ih.n appllcabl. Concluding Peyment
<br />with rospeot to SUch Equipment. EaOh Insuranoe pOlicy will name
<br />L.sse. as an Insured and Lessor or~. a.signs as an additional Insured,
<br />and will tontaln B clause requirIng the Insurer 10 glv8 lessor or its
<br />assigns at lea.t thirty (30) days prior written notlco of any oltoration
<br />In the lerms of .uch pOlicy or the cancollallon thereof. Th. procee~.
<br />of any .uch pollcle. will be payabla to Le.see and Lossor or Its ..slgns
<br />as their Interests may appear. Upon accsptance of the Equipment snn
<br />upon each Insura.nce renewal date, lessee will deliver to LessOr El
<br />certificate evidencing SUCh Insurance. In the event that Lesseo has bean
<br />permlned to &elf.lneure. Lossee wIll furnish lessor wUh a letter or
<br />c.rtlflcete 10 Buch .HoCI. In tho avent of any lo.s, d.mage, InJlIry or
<br />aocldenllnvolving the ~qulpmanl, L....a wltl promptly provido Lossor
<br />with written notice thereof and make available to Lessor aU Informs1ion
<br />and documenta1ion relating thereto and shall permll Lessor to
<br />p.rtiClpate and cooparata wllh Lesle. In making .ny claim for Insurance
<br />In respect thereof.
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