2016-007 - Municipal Lease Agreement with Liberty National Bank for fire truck

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(if any) and proceeds of the refunded bonds expended prior to the Commencement Date. It is the understanding of the Lessee and the Lessor that the covenants contained herein are intended to assure compliance with the Code and any Treasury Regulations promulgated pursuant thereto. In the event that regulations or rulings are hereafter promulgated which modify or expand provisions of the Code, as applicable to this Lease, the Lessee and the Lessor will not be required to comply with any covenant contained herein to the extent that such failure to comply, in the opinion of nationally recognized bond counsel, will not adversely affect the exemption from federal income taxation of the Tax - Exempt Interest Component of the rent payments under section 103 of the Code. In the event that regulations or rulings are hereafter promulgated that impose additional requirements that are applicable to this Lease, the Lessee and the Lessor agree to comply with the additional requirements to the extent necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption from federal income taxation of the Tax - Exempt Interest Component of the rent payments under section 103 of the Code. In furtherance of such intention, the Lessee and the Lessor hereby authorize and direct the Mayor or City Manager of the Lessee to execute any documents, certificates or reports required by the Code and to make such elections, on behalf of the Lessee, which may be permitted by the Code, as are consistent with the purpose for the execution and delivery of this Lease. (n) The Lessor and the Lessee covenant to account for the expenditure of sale proceeds and investment earnings to be used for the property on their books and records by allocating proceeds to expenditures within 18 months of the later of the date that (a) the expenditure is made, or (b) the property is acquired. The foregoing notwithstanding, the Lessee shall not expend sale proceeds or investment earnings thereon more than 60 days after the earlier of (a) the fifth anniversary of the Commencement Date, or (b) the date the final payment is made under this Lease, unless the Lessee obtains an opinion of nationally- recognized bond counsel that such expenditure will not adversely affect the status, for federal income tax purposes, of the Tax - Exempt Interest Component of any rent payment hereunder. For purposes hereof, the Lessor and the Lessee shall not be obligated to comply with this covenant if they obtain an opinion that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the Tax - Exempt Interest Component of any rent payment. (o) The Lessee covenants that the property constituting the Equipment will not be sold or otherwise disposed of in a transaction resulting in the receipt by the Lessee of cash or other compensation, unless any action taken in connection with such disposition will not adversely affect the tax - exempt status of the Tax - Exempt Interest Component of any rent payment. For purpose of the foregoing, the Lessee may rely on an opinion of nationally- recognized bond counsel that the action taken in connection with such sale or other disposition will not adversely affect the tax - exempt status of the Tax - Exempt Interest Component of any rent payment. For purposes of the foregoing, the portion of the Equipment comprising personal property that is disposed of in the ordinary course shall not be treated as a transaction resulting in the receipt of cash or other compensation. For purposes hereof, the Lessee shall not be obligated to comply with this covenant if it obtains an opinion that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the Tax - Exempt Interest Component of any rent payment. 17. EVENT OF DEFAULT. The occurrence of any of the following events (each of them, an "Event of Default ") shall constitute a default under this Lease: (a) Failure of Lessee to pay any installment of rent or any other sum required by this Lease to be paid by Lessee within ten (10) consecutive calendar days after such payment first became due and Lessor is not required to give notice of default for its failure to receive rent. (b) Failure of Lessee to observe, perform or comply with any term, obligation, covenant or condition contained in this Lease or any Schedule (other than an obligation referred to in subparagraph (a) above) and the expiration of the applicable cure period, if any, with respect to that failure.