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HomeMy WebLinkAboutKOCH FINANCIAL CORP. - Lease/Purchase Agreement Public Works Department Equipment 2/5/96 - 1996-02-05Council/Agency Meeting Held: r� Deferred/Continued to:AaAe2=::� XApproved ❑ Conditionally Approved ❑ Denied V� , City Clerk's Signatu e Council Meeting Date: 2/5/96 Department ID Number: AS 96-003 CITY OF HUNTINGTON BEACH REQUEST FOR COUNCIL ACTION SUBMITTED TO: HONORABLE MAYOR AND CITY COUNCIL MEMBERS SUBMITTED BY: MICHAEL T. UBERUAGA, City Admini PREPARED BY: ROBERT J. FRANZ, Deputy City Admini SUBJECT: PUBLIC WORKS EQUIPMENT LEASE/PURCHASE FINANC Statement of Issue, Funding Source, Recommended Action, Alternative Action(s), Analysis, Environment Status, Aftachment(s) Statement of Issue: The City is acquiring the following budgeted equipment for the Public Works Department; 1. Street Sweepers 2. Asphalt Patch Truck Funding Source: Per approved budget, page 129 Eguiament_ Account Number Budget Sweepers E-IQ-PW-858-702-00 $42,000/yr Asphalt Patch Truck E-IQ-PW-863-702-00 $19,000/yr Recommended Action: Approve the tax-exempt equipment lease purchase agreement with Koch Financial Corporation and authorize the Mayor and City Clerk to execute the agreement. Authorize and direct Deputy City Administrator to sign and deliver all necessary forms and other documents in connection with the above agreement. Analysis: Koch Financial corporation submitted the lowest cost proposal for this lease - purchase financing. four other bidders responded to our Request for Proposal. The total cost for this equipment is $452,520. including interest cost at 5.285% for Street Sweepers on a 7 year term. 5.235% for Asphalt Patch Truck. This payment schedule is in Exhibit B of the agreement. 0016483.01 01M6196 4:16 PM S QUEST FOR COUNCIL ACTIN MEETING DATE: 215196 DEPARTMENT ID NUMBER: AS 96-003 Insurance for the equipment being purchased through this lease -purchase agreement will be provided by the City consistent with current policies and procedures. This equipment will be insured through our commercial insurance policy except for the trailer which will be self - insured. Alternative Actions : Do not approve lease purchase. Attachment(s): Equipment Lease Purchase Agreement Worksheet 1 - Cost breakdown of Tymco Sweeper, Worksheet 2 - Cost breakdown of Asphalt Patch truck Worksheet 3 - List of bidders 0016483.01 -2- 01/28/96 4:44 PM frooe desk of: EVELYN SCHUBERT Deputy City Clerk City of Huntington Beach P.O. Box 190 - Huntington Beach, CA 92648 (714) 53$-5405 eeu-�d CITY oto. A/1W EQUIPMENT LEASE CURCHASE AGREESIE�T This EQUIPMENT LEASE PURCHASE AGREEMENT (the "Agreement"), dated as of January 15, 1996, and entered into beta+een Koch Financial Corporation, a Kansas Corporation ("Lessor"), and the City of Huntington Beach, a body corporate and politic existing under the laws of the State of California ("Lessee"). WITVESSETH: WHEREAS, Lessor desires to lease the Equipment, as hereinafter described in Exhibit "A", to Lessee and Lessee desires to lease the Equipment from Lessor subject to the terms and conditions of and for the purposes set forth in this Agreement; and WHEREAS, Lessee is authorized under the constitution and laws of the State of California to enter into this agreement for the purposes set forth herein; NOW, THEREFORE, in considerations of the premises and the mutual covenants and agreements herein set forth, Lessor and Lessee do hereby covenant and agree as follows: ARTTCLE I Section 1.01. DefmitipIL4. The following terns will have the meanings indicated below unless the context clearly requires otherwise. "Agreement" means this Equipment Lease Purchase Agreement and any schedule or exhibit made a part hereof by the parties hereto, together with any amendments to the Agreement made pursuant to section 13.06. "Code" means the Internal Revenue Code of 1986, as amended. "Commencement Date" is the date when the term of this Agreement and Lessee's obligation to pay rent commences, which date shall be the earlier of (i) the date on which the Equipment is accepted by Lessee in the manner described in Section 5.01, or (ii) the date on which sufficient monies to purchase the Equipment are deposited for that purpose with an escrow agent. "Equipment" means the property described in Exhibit "A", Equipment Description, and all replacements, repairs, restorations, modifications and improvements thereof or thereto made pursuant to Article VIII. "Escrow Agreement" means the Escrow Agreement, dated as of the date hereof, among Lessor, Lessee and Boatmen's Trust Company, as Escrow Agent. "Event of Default" means any event of default described in Section 12.01. "Issuance Year" means the calendar year in which the Commencement Date occurs. "Lease Term" means the Original Tenn and all Renewal Terms. "Lessee" means the entity described as such in the first paragraph of this Agreement, its successors and its assigns. "Lessor" means the entity described as such in the first paragraph of this Agreement, its successors and its assigns. "Original Term" means the period from the Commencement Date until the end of the budget year of Lessee in effect on the Commencement Date. "Purchase Price" means the amount designated as such on Exhibit 13 hereto that Lessee may, in its discretion, pay to Lessor to purchase the Equipment. "Renewal Terms" means the renewal terms of this Agreement, each having a duration of one year and a term coextensive with Lessee's budget year. "Rental Payments" means the basic rental payments payable by Lessee pursuant to Section 4.0 L "Rental Payment Date" means the date upon which any Rental Payment is due and payable as provided in Exhibit B. "State" means the state in which Lessee is located. "Vendors" means the manufacturer of the Equipment as well as agents or dealers of the manufacturer from whom Lessor purchased or is purchasing the Equipment. 17J ARTICLE II Section 2.01. Reoresentations and Cgvenants of 1_essee. Lessee represents, covenants and warrants for the benefit of Lessor as follows: (a) Lessee is a public body corporate and politic duty organized and existing under the constitution and laws ofthe State with full power and authority to enter into this Agreement and the transactions contemplated hereby and to perform all of its obligations hereunder. (b) Lessee has duly authorized the execution and delivery of this Agreement by proper action by its governing body at a meeting duly called, regularly convened and attended throughout by the requisite majority of the members thereof or by other appropriate official approval, and all requirements have been met and procedures have occurred in order to ensure the validity and enforceability ofthis Agreement. (c) No event or condition that constitutes, or with the giving ofnotice or the (apse of time or both would constitute, an Event ofDrfault exists at the date hereof. (d) Lessee has, in accordance with the requirements of law, fully budgeted and appropriated sufficient funds for the current budget year to make the Rental Payments scheduled to come due during the current budget year, and to meet its other obligations for the current budget year, and such funds have not been expended for other purposes. (e) Lessee will do or cause to be done all things necessary to preserve and keep in full fora and effect its existence as a public body corporate and politic. (1) Lessee has complied with such public bidding requirements as may be applicable to this Agreement and the acquisition by Lessee of the Equipment, except that future acquisitions of items of Equipment shall be acquired by Lessee pursuant to competitive bids in compliance 10 h applicable law. (g) During the Lease Term, the Equipment will be used by Lessee only for the purpose of performing essential governmental or proprietary functions of Lessee consistent with the permissible scope oftessee's authority. (h) Lessee will annually provide Lessor with current financial statements, budgets, proofs of appropriation for the ensuing budget year and other such financial information relating to the ability of Lessee to continue this Agreement as may be requested by Lessor. (i) Lessee will comply with all applicable provisions of the Code, including without limitation Sections 103 and 148 thereof, and the applicable regulations of the Treasury Department to maintain the exclusion of the interest components of Rental Payments from gross income taxation. 6) Lessee will use the proceeds of this Agreement as soon as practicable and with all reasonable dispatch for the purpose for which the Agreement has been entered into. No part of the proceeds of the Agreement shall be invested in any securities, obligations or other investments or used, at any time, directly or indirectly, in a manner which, if such use had been reasonably anticipated an the date of issuance of the Agreement, would have caused any portion of the Agreement to become "arbitrage bonds" within the meaning of Section 103(b)(2) or Section 148 of the Code and the applicable regulations of the Treasury Department. Section 2.02. Certification as to Arbitrage. Lessee hereby represents as follows: (a) The estimated total costs of the Equipment will not be less than the total principal amount of the Rental Payments. (b) The Equipment has been ordered or is expected to be ordered within six months of the Commencement Date, and the Equipment is expected to be delivered and installed, and the Vendor fully paid, within one year of the Commencement Date. (c) Lessee has not created or established, and does not expect to create or establish, any sinking fund or other similar fund (i) that is reasonably expected to be used to pay the Rental Payments, or (ii) that may be used solely to prevent a default in the payment of the Rental Payments. (d) The Equipment has not been and is not expected to be sold or otherwise disposed of by Lessee, either in whole or in major pan, prior to the last maturity of the Rental Payments. (e) To the best of our knowledge, information and belief, the above expectations are reasonable. (f) Lessee has not been notified of any listing or proposed listing of it by the Internal Revenue Service as an issuer whose arbitrage certificates may not be relied upon. ARTICLE Ill Section 3.01. Lease of Equip111ta. Lessor hereby demises, leases and lets to Lessee, and Lessee rents, leases and hires from Lessor, the Equipment in accordance with this Agreement for the Lease Term. The Lease Term may be continued, solely at the option of Lessee, at the end of flie Original Term or any Renewal Tem for an additional Renrwal Tcmi up to the maximum I,rmc Tcnii set forth in Exhibit B hereto. At the end of Me Original Term :uld at the end of each Renewal Tern, until the maximum Lease 'Teri, has been completed. Lessee shall be deamed to huve exerciced its option to continue this Agreement IN the next Renewal Term if I..esscc budgets and apprnpriatcs or otherwise mukcs legally available 11inds to pay Rental Payments for such Renewal l emi, unless Lessee Shull have remnnnicd this Agrermrni pursuant to Section 10.01. the tennis acid conditions during any Renewal Tenn shall be the sonic zo the terms and eunditions during the Original Trrm, except that the Rental Payment shalt be us provided on Exhibit B herew. Section 3.02. CQntinuarion Qf LeaSg Ir_. Lcssee intends, subject N Sccrion 3.03, to continue the "c Term through the Original Term Lind all Renewal Terns and to pay the Rental Payments hereunder. Lessee reasonably believes that IegOy avuiluhle hinds in an .unount sufficient to make all Rentiil Payments during the entire Lca_nc Temi can N obtained. Section 3.03. '.4onfipproprintion. Nolwilhstumding any nnher provisions of this Agreement, I..essee is Obligated only to pay such Rtittnl Payments under thin Agreement as may lawfidly he made from finds budgeted and appropriated for shut purpose during Lessees then current budget year. Should Lcssee l ail to budget, appropriate nr otherwise make avallable funds to pay Renal Payments loltuwing the then current Original Tcrm nr Renewal Term, this Agreement shall be dccmed terminnted at the end of the then current Original Term or Renewal Term. Lesser agrees to deliver notice to lx-vinr of such termination it least 90 duys prior to the end of then curanl Oribin:d Terns or Renewal Tcnn, but Ibilure to give such wilice Shall not extend the term hcyond such Origind Term or Renewal Term. If this Agreement is terminulcd in accordance with This Section. Lcssce agreed to peaccuhly deliver the Fquipincrit to i.essor al the locittion(s) to be spcciticd by Lessor. ARTICLE IV Section 4.01. Aretul t°avments. Leases shall promptly pity Rental Puymcntc, exclusively froin legally available funds, in lawlul money of the United States of Arrmrrica to t_essnr on the dates and in such amounts us described on Exhibit B hereto. Lessee %hull pay Lessor a charge on any Rental Puymcnt nut paid on the date such payment is due at the rate of 121A per annum or the maximum amount permitted by law, whichever is Jess, from such lute. A portion at each Rental Payment is paid as and represents paymcnr at, in(eresr, as set roah en Exhibit H hereto. Section 4.02 9tval N me s to Com-filMCorti. Lc%wr end l..cssco understand Lind intend that the obligation ,if Lessee to pay Rental Payments hereunder shall constitute a current Cxpenst: of Lessee and shall no in any way he construed to be a debt or txssre in cmitravcrition of any applicable constitutional or statutory limitation or requirement governing the creation of indchtechicss by Lessee. nor shall unything contained herein constitute a pledge Of the grnerul lux revenue-., Fund+ nr mnticys of Lessee. Section 4.03. fiEbTAI_ paXWl:.N-l-g 10 RF UNCONDITU)NAL, EXCEPT AS PROVIDED IN SECTION 3.03, Tire OBLIGATiONS OF LESSEE TO W''%-KE RENTAL PAYMI NTS AND TO PF,IIFOR\f AND OBSERVE THE Of HER COVF,NANTS AND AGREEMFNTS CONTAINED HEREIN SHALL BC ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS WITHOUT ABATE:NiFNT, DIMINI,ITION, DEDUCTION. SET-OFF OR DEFENSE, FOR ANY RF:ASCIN, iNCLUDiNG WITHOUT LIMITATION ANY PAILURIi' OF THE EQUIPMENT, ANY DEFECTS, MALFLNCTIONS, BREAKDOWNS OR INFIRMITIES iN THE EQUIPMENT Ok ,WY ACCIDENT, CONDEMNATION OR tINFORESEEN CIRCUMSTANCES. ARTICLE V Section 5.01. Deliver, Instatlatlon and _Acceptance _or.Ibc .gltipment. Lessee shaft Order lire 13quipment. cause the Fcluipmcnt to be dellvered :uid in►tullyd ut the location spccifed on Exhibit A in this Agreement and pay any and all delivery and installation costa in connection tlierewitla, When IN Equipment has been delivered, installed, tested Lind accepted by Lessee, Lcssee shall immediately accept the Equipment and evidence said acceptance by executing and delivering to Lessor an acceptance certith utr-ueceptuhle to Lessor, included herein as Exhibit C. Sea:rion 5.02. Cniny=ras mr Lessor shall provide Lcssee with quiet use mid enjoyment or thtf Equipment during the lease Term. and Lessee shall peaecubly and quietly have, hold Lind crliny tht Equiptilcm during the Lease Torte, without wit, trouble ur hindrance From Lessor. cxcrpt us olhcnvisn expressly srl rorth in this Agreement. No Registered Owner shall interfere with such quirt use and enjoyment during the Leine Term so lung us Uiiwr is nut in default under thi% Agreemrnt. Seelion 5_03, 1"a l= Imprcriun. Once installed, the Equipmcnt will not be moved lion) the loeaGon specified on Exhibit A to this Agrocnient without Lessor's consent, which consent shall not be unrewonahly withheld, lessor shall have the right -,it all reasonable times during Ngtilar btisincss hours to enter into and upon the property or Lessee liar the purpose of inspecting the Equipment, Section 5 04. t_icc and 4tabitenance, or the rL ... 'pmeat. L cssrc will not in%till. use. nperate nr maintain the Equipment improperly, cnreleccly, in vinlarian of any applicable law or in a nmanner contrary to that "intermpluted by this Agreement- Lessee shall provide all permits and licenses, if any, necessary liar the installation and nperation of rile Equipment. In ,addition. Lessee agrees to comply in WI respects with all applicahle laws. rcguluriom tend rulings of any Icgi%lutivc, executive, administrative or judicial body; provided that Lassre may cunirst in goad faith the validity or application of Ally +u.h law, regulation or ruling in arty reasonablc manner shut does not, in the npininn of t.eccor, adversely affect tN_ interest of Lessor in and to the Equipment or its interest or rights under thi9 Agreement, I_essde agrees that it will, at Lessuds own oust and expense, maintain, preserve and keep the F,quipmcnt in good repair and working order. I egyor shall have na responslbiliry to maintain, repair or make irnpruvcments or additions to the Equipmcnt, Upon the request of Lessor. Lesser will enter into n maintenance contract for Lhc Equipment wifli Vendor. Section 10.01. The amount of the Net Proceeds, if any, remaining after completing such repair, restoration, modification or improvement or after purchasing Lessor's interest in the Equipment shall be retained by Lessee. If Lessee shall make any payments pursuant to this Section, Lessee shall not be entitled to any reimbursement therefor from Lessor nor shall Lessee be entitled to any diminution of the amounts payable under Article IV. ARTICLE IX Section 9_01. DISCLAIMER OF WARRANTIES. LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALL'E, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE OR FITNESS FOR USE OF THE EQUIPMENT, OR WARRANTY WITH RESPECT THERETO. IN NO EVENT SHALL LESSOR BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE IN CONNECTION WITH OR ARISIN9OUT OF THIS AGREEMENT OR THE EXISTENCE, FUTRNISHING, FUNCTIONING OR LESSEE'S USE OF ANY ITEM, PRODUCT OR SERVICE PROVIDED FOR IN THIS AGREEMENT. Section 9,02. Vendor's Warranties. Lessor hereby irrevocably appoints Lessee its agent and attorney -in -fact during the Lease Tenn, so long as Lessee shrill not be in default hereunder, to assert from time to time whatever claims and rights (including without limitation warranties) related to the Equipment that Lessor may have against the Vendor. Lessee's sole remedy for the breach of such warranty, indemnification, or representation shall be against the Vendor of the Equipment and not against Lessor. Any such matter shall not have any effect whatsoever on the rights and obligations of Lessor with respect to this Agreement, including the right to receive full and timely payments hereunder. Lessee expressly acknowledges that Lessor makes, and has made, no representations or warranties whatsoever as to the existence orthe availability of such warranties by the Vendor of the EquipmenL ARTICLE X Section 10.01. purchase Ootion. Lessee shall have the option to purchase Lessor's interest in the Equipment, upon giving written notice to Lessor at least 60 days before the date of purchase, at the following times and upon the following terms: (a) On the Rental Payment Dates specified in Exhibit R, upon payment in full of the Rental Payments then due hereunder plus the then applicable Purchase Price plus $1.00 to Lessor; or (b) In the event of substantial damage to or destruction or condemnation of substantially all of the Equipment, on the day Lessee specifies as the purchase date in Lessee's notice to Lessor of its exercise of the purchase option, upon payment in full of the Rental Payments then due hereunder plus the then applicable Purchase Price to Lessor. ARTICLE XI Section 11.01. Assignment by Lesw . Lessor's right, title and interest in, to and under this Agreement and the Equipment may be assigned and reassigned in whole or in part to one or more assignees or subassignees by Lessor; provided that (a) any assignment, shall not be effective until Lessee has received written notice, signed by the assignor, of the name, address and tax identification number of the assignee. Lessee shall retain all such notices as a register of all assignees and shall make all payments to the assignee or assignees designated in such register. Lessee agrees to execute all documents, including notices of assignment and chattel mortgages or financing statements that may be reasonably requested by Lessor or any assignee to protect its interests in the Equipment and in this Agreement- Lessee shall not have the right to and shall not assert against any assignee any claim, counterclaim, or other right Lessee may have against Lessor. Section 11.02. Assignment and Subleasing by Lessee. None of Lessee's right, title and interest in, to and under this Agreement and in the Equipment may be assigned or encumbered by Lessee for any reason, except that Lessee may sublease all or part of the Equipment if Lessee obtains the prior written consent of Lessor and an opinion of nationally recognized counsel in the area of tax exempt municipal obligations satisfactory to Lessor that such subleasing will not adversely affect the exclusion of the interest components of the Rental Payments from gross income for federal income tax purposes. Any such sublease of all or part of the Equipment shall be subject to this Agreement and the rights of the Lessor in, to and under this Agreement and the Equipment ARTICLE XI1 Section 12.01. Evgnts of j2efault Defined. Subject to the provisions of Section 3.03, any of the following events shall constitute an "Event of Default" under this Agreement: (a) Failure by Lessee to pay any Rental Payment or other payment required to be paid hereunder at the time specified herein; (b) Failure by Lessee to observe and perform any covenant, condition or agreement on its pan to be observed or performed, other than as referred to in subparagraph (a) above, for a period of 30 days after written notice specifying such failure and requesting that it be remedied is given to Lessee by Lessor, unless Lessor shall agree in writing to an extension of such time prior to its expiration; provided that, if the failure stated in the notice cannot be corrected within the applicable period, Lessor will not unreasonably withhold its consent to an extension of such time if corrective action is instituted by Lessee within the applicable period and diligently pursued until the default is corrected; (c) Any statement, representation or warranty made by Lessee in or pursuant to this Agreement or its execution, delivery or performance shall prove to have been false, incorrect, misleading or breached in any material respect on the date when made; (d) Any provision of this Agreement shall at any time for any reason cease to be valid and binding on Lessee, or shall be declared to be null and void, or the validity or enforceability thereof shWI be contested by Lessee or any governmental agency or authority if the loss of such provision would materially adversely affect the rights or security of Lessor, or Lessee shall deny that it has any further liability or obligation under this Agreement; (e) Lessee shall (i) apply for or consent to the appointment of a receiver, trustee, custodian or liquidator of Lessee, or of all or a substantial part of the assets of Lessee, (H) be unable, fail or admit in writing its inability generally to pay its debts as they become due, (M) make a general assignment for the benefit of creditors, (iv) have an order for relief entered against it under applicable federal bankruptcy law, or (v) file a voluntary petition in bankruptcy or a petition or an answer seeking reorganization or an arrangement with creditors or taking advantage of any insolvency law or any answer admitting the material allegations of a petition filed against Lessee in any bankruptcy, reorganization or insolvency proceeding; or (f) An order, judgment or decree shall be entered by any court of competent jurisdiction, approving a petition or appointing a receiver, trustee, custodian or liquidator of Lessee or of all or a substantial part of the assets of Lessee, in each case without its application, approval or consent, and such order, judgment or decree shall continue unstayed and in effect for any period of 30 consecutive days. Section 12.02. Remedies, on Default. Whenever any Event of Default exists, Lessor shall have the right, at its sole option without any further demand or notice, to take one or any combination of the following remedial steps: (a) By written notice to lessee, Lessor may declare all Rental Payments and other amounts payable by Lessee hereunder to the end of the then current Original Term or Renewal Term to be due; (b) With or without terminating this Agreement, Lessor may enter the premises where the Equipment is located and retake possession of the Equipment or require Lessee at Lessee's expense to promptly return any or all of the Equipment to the possession of Lessor at such place within the United States as Lessor shall specify, and sell or lease the Equipment or, for the account of Lessee, sublease the Equipment, continuing to hold Lessee liable for the difference between (i) the Rental Payments and other amounts payable by lessee hereunder to the end of the then current Original Term or Renewal Term, and (ii) the net proceeds of any such sale, leasing or subleasing (after deducting all expenses of Lessor in exercising its remedies under this Agreement, including without limitation all expenses of taking possession, storing, reconditioning and selling or leasing the Equipment and all brokerage, auctioneers' and attorneys' fees); and (c) Lessor may take whatever action at law or in equity may appear necessary or desirable to enforce its rights as the owner of the Equipment. Section 12.03. NaJgmedyExc] live. No remedy herein conferred upon or reserved to Lessor is intended to be exclusive and every such remedy shall be cumulative and shall he in addition to every other remedy given under this Agreement now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to he a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle Lessor to exercise any remedy reserved to it in this Article it shall not be necessary to give any notice other than such notice as may be required in this Article. ARTICLE X I R Section 13.01. No�tico- All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, to the parties hereto at the addresses immediately after the signatures to this Agreement (or at such other address as either party hereto shall designate in writing to the other for notices to such party), to any assignee at its address as it appears on the registration books maintained by Lessee or the Agent. Section 13.02. En im-Agmtmmit. This Agreement constitutes the entire agreement between Lessor and Lessee. Section 13.03. ElInding-E&CS. This Agreement shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. Section 13.04. SgyCMbility. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. Section 13.05. Amsi]dme Chagg�s and il�odifications. This Agreement may be amended by Lessor and Lessee. Section 13.06. . This Agreement may be simuitaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 13.07. A9q1kAWsygw. This Agreement shall be governed by and construed in accordance with the laws of the State. Section 13.09. Cap i=. The captions or headings in this Agreement are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement. IN ATINESS WI-IEREOF, Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives as of the date written above. (LESSOR) Koch Financial Corporation 4111 E. 37th St, North Wichita, Kansas 67220 BY TITLE (LESSEE) City of Huntington Beach 2000 Main St. Huntington Beach, Ca 96248 Zwo--C' BY TITLE Ma Ve ATTEST -Y7f��o TITLE ( QTY C1 EkK APPROVED AS TO FORM GA1L HUTTON, City Attorney OMV i Tymco Street Sweepers Model 600 P-B Asphalt Patch Truck Model 13-5 (LESSE$) City of Huntington Beach 2000 Mrun St. Huntington Beach, Califomia 96248 By Title EXHIBIT B TO EQUIPMENT LEASE PURCHASE AGREEMENT RENTALPAYMENT SCHFDULE Rental Payment Rental Payment Rental Payment Interest Principal Purchase Number Due Date Amount Portion Portion Price 1 4115196 S13,111.81 $3,614.69 $9,497.12 S270,263.75 2 7/15/96 $13,111.81 $3,489,73 $9,622.09 $260,449.23 3 10/15/96 $13,111.81 $3,363.11 $9,748.70 $250,505.55 4 1/15/97 S13,11111 $3.234.83 $9,876.98 $240,431.04 5 4/15/97 $13,111.81 $3,104.87 $10,006.94 $230,223.96 6 7/15/97 $13,111.81 S2,973.19 $10,138.62 $219,882.56 7 10/ 15/97 $13,111.81 $2,839.78 $10,272.03 $209,405.09 8 1115198 $13,111.81 $2, 704.62 S 10,407.19 $198,789.75 9 4/15/98 $13,111.91 S2,567.67 $10,544.14 $188,034.73 10 7/15/98 $13,111.81 S2,428.93 $10,682.88 $177,138.19 11 10115198 S13,111.81 $2,298.35 S10,S23.46 $166,098.27 12 1115/99 $13,111.81 $2,145.93 S 10,965.88 $154,913.07 13 4/15/99 $13,111.81 S2,001.64 SI1,110.l7 $143,580.69 14 7115199 $13,111,81 $1,855.44 $11,256,37 $132,099.20 15 10/15/99 $13,111.81 $1,707.33 $11,404.48 $120,466.63 16 1/15/00 S13,111.61 $1,557.26 $11,554.55 $108,680.98 17 4/15/00 $13,111.81 S1,405.22 $11,706.59 $96,740.26 18 7115/00 $13,111.81 $1,251.18 $11,860.64 $94,642.41 19 10/15/00 $13,111.81 $1,095.11 S12,016.70 $72,385.37 20 1115101 $13,111.81 $936.98 $12,174.83 $59,967.05 21 4/15/01 $7,792.53 $776.78 $7,015.75 $52,810.98 22 7/15/01 $7,792.53 S684.08 $7,108.45 S45,560.36 23 10/15/01 S7,792.53 $590.16 S7,202.37 $38,213.95 24 1/15102 $7,792.53 S495.00 $7,297.53 $30,770.47 25 4115/02 $7,792.53 $398.58 $7,393.95 $23,228.64 26 7/15/02 $7,792.53 $300.89 $7,491.64 $15,587.17 27 10/15/02 S7,792.53 S201.91 $7,590.62 $7,844.73 28 1/15/03 $7,792.53 $101.62 S7,690.91 $1.00 Totals: $324,576.46 S50,114.88 $274,461.58 (LESSEE) City of Huntington Beach 2000 Main St. Huntington Beach, California 96248 By Title EXHIBIT C TO EQI IPMEN17 LEASE PURCHASE AGREEMENT ACCEPTANCE CERTIFICATE Koch Financial Corporation 4111 E. 37th St., North Wichita, Kansas 67220 Re: Equipment Lease Purchase Agreement, dated as of January 15, 1996 (the "Agreement"), between Koch Financial Corporation ("Lessor') and the City of Huntington Beach ("Lessee'). Ladies and Gentlemen: In accordance with the Agreement, the undersigned Lessee hereby certifies and represents to, and agrees with, Lessor as follows: (1) All of the Equipment (as defined in the Agreement) has been delivered, installed and accepted on the date hereof. (2) 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 an purposes. (3) Lessee is currently maintaining the insurance coverage required by section 7.02 of the Agreement. (4) No event or condition that constitutes, or with notice or lapse of time, or both, would constitute an Event of Default (as defined in the Agreement) exists at the date hereof. Dated: (Lessee) City of Huntington Beach 2000 Main SL Huntington Beach, California 96248 By: [SEAL] Title: 0 • (TO BE PR]NTED ON ATTORNEYS LETTERHEAD) EXHIBIT D TO EQUIPMENT LEASE PURCHASE AGREEMENT As legal counsel to Lessee, I have examined the Equipment Lease Purchase Agreement dated as of January 15, 1996 (the "Agreement"), between Koch Financial Corporation (the "Lessor") and the City of Huntington Beach (the "Lessee"), which, among other things, provides for the sale to and purchase by the Lessee of the Equipment, (b) an executed counterpart of the ordinance or resolution of Lessee which, among other things, authorizes Lessee to execute the Agreement and (c) such other opinions, documents and matters of law as 1 have deemed necessary in connection with the following opinions. Based on the foregoing, I am of the following opinions: (1) Lessee is a public body corporate and politic, duly organized and existing under the laws of the State, and has a substantial amount of one or more of the following sovereign powers: (a) the power to tax, (b) the power of eminent domain, and (c) police power; (2) Lessee has the requisite power and authority to purchase the Equipment and to execute and deliver the Agreement and to perform its obligations under the Agreement; (3) 'The Agreement and the other documents either attached thereto or required therein have been duly authorized, approved and executed by and on behalf of Lessee, and the Agreement is a valid and binding obligation of Lessee enforceable in accordance with its terms; (A) The authorization, approval and execution of the Agreement and all other proceedings of Lessee relating to the transactions contemplated thereby have been performed in accordance with all open meeting laws, public bidding laws and all other applicable state and federai laws; and (5) There is no proceeding pending or threatened in any court or before any govemmental authority or arbitration board or tribunal that, if adversely determined, would adversely affect the transactions contemplated by the Agreement or the security interest of Lessor or its assigns, as the case may be, in the Equipment. All capitalized terms herein shot[ have the same meanings as in the foregoing Agreement. Lessor, its successors and assigns, including without limitation any Registered Owners, and any counsel rendering an opinion on the tax-exempt status of the interest components of Rental Payments are entitled to rely on this opinion. Printed Name: Dated: Address: Signature: Telephone No: 0 J EXHIBIT E TO EQUIPMENT LEASE. PURCHASE AGREENIEN7 CEI&nFICATE OF CLFRK OR SECREIARY OE LESSEE I, the undersigned, do hereby certify (i) that the officer of Lessee who executed the foregoing Agreement of behalf of Lessee and whose genuine signature appears thereon, is the duly qualified and acting officer of lessee as stated beneath his or her signature and has been authorized to execute the foregoing Agreement on behalf of Lessee, and (ii) that the budget year of Lessee is Flom Jowly-14D Juae30 Off° b sr r fi Soetar, bar go - Dated: By:_ Title: Gentlemen: This confirms and affirms that the Equipment described in Exhibit A to Equipment Lease Purchase Agreement dated January 15, 1996 (the "Agreement") is essential to the function of the undersigned or to the service we provide to out citizens. Further, we have an immediate need for, and expect to make immediate use of, substantially all such Equipment which is not temporary or expected to diminish on the foreseeable future. Such Equipment will be used by us only for the purpose of performing one or more of our governmental or proprietary functions consistent with the permissible scope of out authority. Specifically, such Equipment was selected by us to be used as follows: The estimated useful life of such Equipment based upon manufacturer's representations and our projected needs is Our source of Ponds for Rental Payments due under the Agreement for the current fiscal year is We expect and anticipate adequate funds to be available for all future Rental Payments due after the current fiscal year for the following reasons: (Lessee) City of Huntington Beach 2000 Main St. Huntington Beach, Califomia 96248 By: TitJe: w:W-F6doclhuntbea2 Foy 8038.� Information R& for Tax -Exempt Governmental legations ► under Internal Revenue Code section 149(e) OMS No. 1545-0720 (Rev. May 1995) ► See separate Instructions. inMOMW PAPA"nw e� (Note: Use Form 8Li38-GG if the Issue price 1s under $100,00I0.) F9.1m Rennrtina Authnrity If Amended Return. check here ► I-1 1 Issuer's ram$ City of t to -Beach------- 2 Issuers employer identification number 3 Number and street (or P.O. box .If -mall -Is not delivered to street address) Room/suite . 4._ Deport number G19 - 6 City, town. or post office, state, and ZIP code Huntington Beach CA 92648 6 Date of Issue 7 Name of issue a CUSiP number IM2 of Issue check applicable boxes and enter the issue rice 9 10 11 12 13 14 15 16 17 18- ❑ Education (attach schedule -see Instructions) . . . . . . . . . . ❑ Health and hospital (attach schedule -see inst actions) . . . . . . . ❑ Transportation . . . . . . . . . . . . . . . . . . . . ❑ Public safety. . . . . . . . . . . . . . . . . . . ❑ Environment (including sewage bonds) . . . . . . . . . . . . ❑ Housing . . . . . . . . . . . . . . . . . . . . . . ❑ utilities . . . . . . . . . . . . . . . . . . . . . . ® Other. Describe (sea Instructions) ► If obligations are tax or other revenue anticipation bonds, check box ► ❑ If obligations are in the form of a lease or installment sale, check box ► . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . 9 Is 10 11 12 13 14 15 16 274 461. 58 Description of Obligations Maturity date ilttererost rate IoBb) mption emption rede rice at meta Weighted average maturity Y eld Jet intered CW 19 Final maturity. N/A N/A % N/A N/A $274,461.58 N/A 6 ears .2 g� 20 Entire issue Uses of Proceeds of Bond Issue (inckKring underwriters' discount NIA 21 Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . 21 72 22 Issue price of entire issue (enter amount from line 20, column (c)) . . . . . . . . 23 Proceeds used for bond issuance costs (including tide writers' discount) . 23 24 Proceeds used for credit enhancement . . . . . . . . . . 24 25 Proceeds allocated to reasonably required reserve or teptacement fund . . 25 26 Proceeds used to currently refund prior issues . . . . . . . 26 27 Proceed-- used to advance refund prior issues 97 28 Total (add lines 23 through 27) . . 28 29 29 Nonrefundin roceeds of the Issue subtract line 28 from line 22 and enter arstou'Where . 1 U6ccri lion of Refunded Bonds Co to this part on for refunding bonds. 30 Enter the remaining weighted average maturity of the bonds to be currently refunded . ► years 31 Enter the remaining weighted average maturity of the bonds to be advance refunded . . . ► years 32 Enter the last date on which the refunded bonds win be called . . . . . . . . . . ► 33 Enter the data s the refunded bonds were issued • Miscellaneous N/A 34 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) 34 35 Enter the amount of the bonds deslgna4ed by the issuer tinder section 265(b)(3)(BXI]011) (small issuer exception) 35 36a Enter the amount of gross Proceeds invested or to be invested in a gram toad investment contract (see instructions) i 36a b Enter the final maturity date of the guaranteed investment contract . ► 37 Pooled firiancings: a Proceeds of this issue that are to be used to make bans to other governmental units 137a b If this issue Is a loan made from the proceeds of another tax-exempt issue, check box ► ❑ and enter the name of the 38 39 Issuer ► and the date of the Issue ► 1f the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . ► ❑ If the issuer has identified a hedge, check box► ❑ PxW penalties of perjury, I declare mi e that 1 have exaned the ralmn and accompanying echeduies•and statemente, and to the bast of my knowledge enexamined and belief, they one b—, owect, and a mpiete. Please Sign Here `Type , Signature of lasuer's authorized representative Date or print name and title For Paperwork Reduction Act Notice, see page 1 of the instructions. cat. No. 637738 For, 8038-G (Rev. 5-9s) 9 /Yasd en ngoNd p.prr REORDER FROM STATE OF CALIFORNIA Regietr6, Inc. UNIFORM COMMERCIAL CODE - FINANCING STATEMENT - FORM UCC-1 (REV. 111/91) 5I4 PIERCE $T. D. 225.67 ANORA. MN. SS]U! (c:21.91.17'! IMPSANT-Read instructions on back befor ing out form This FINANCING STATEMENT is presented for filing and will remain effective with certain exceptions for a period Of five years from the date of filing pursuant to section 9403 of the California Uniform Commercial Code. 1. AEBTOR (LAST NAME FIRST) -IF AN INDIVIDUAL) 1A. SOCIAL SECURITY OR FEDERAL TAR N City of Huntineton Beach 1B. MAILING ADDRESS CITY. STATE to. ZIPCODE 2000 Main Street Ztington Beach, CA 192648 2. ADDITIONAL DEBTOR (1F ANY) (LA$T NAME FIRST —IF AN INDIVIDUAL) 2A. SOCIAL SECURITY OR FEDERAL TAX ) 2s. MAILING ADDRESS 2C• CITY. STATE 2D. ZIP CODE 3. DEBTOR'S TRADE NAMES OR STYLES (IF ANY) 3A. FEDERAL TAX NUMBER 4. SECURED PARTY 4A. SOCIAL SECURITY NO.. FEDERAL TAK NO_ NAME Koch Financial Corporation ON SANK TRANSIT AND A.B.A. NO. MAILING ADDRESS 4111 E. 37th Street North CITY Wichita STATE KS ZIP CODE 67220 48-1115169 5. ASSIGNEE OF SECURED PARTY IIF ANY} SA. SOCIAL sECDNiTT No.. FEDERAL TAX No. OR BANK TRANSIT AND A-B.A. NO. NAME MAILING ADDRESS CITY STATE ZIP CODE s. This FINANCING STATEMENT covers the following types or items of property (include description of real property on wh located and owner of record when required by instruction 4). Equipment Lease/Purchase Agreement dated as of January 15, 1996 by and between Debtor and Secured Party. Equipment as listed: (2) Tymco Model 600 Street Sweepers (1) P-B Model B-5 Asphalt Patch Truck © i 70. DEBTOR(8) SIGNATURE NOT REQUIRED IN ACCORDANCE WITH 7. CHECK I yA PRODUCTS OF COLLATERAL INSTRUCTION 5 (D) ITEM: IF APPLICABLE I ElARE ALSO COVERED ❑ (1) ❑ (2) ❑ (3) ❑ (4 ) I S. CHECK Fx_1 I IF APPLICABLE i 1 9. - SI NATURR(S) OF DEBTORS) ❑ DEBTOR IB A "TRANSMITTING UTILITY" IN ACCORDANCE WITH UCC 1 9105 (1) (n) City of Huntington Beach 0- BIG Koch Financial. Corporation 1 1. Return copy to: NAME ADDRESS { CITY } STATE ZIP CODE L Koch Financial Corporation 4111 E. 37th Street North Wichita, KS 67220 DATE; I C i 10. THIS SPACE FOR USE OF FILING OFFICER jJl o III (DATE. TIME, FILE NUMBER G AND FILING OFFICER) e -I 0 2 3 4 5 6 7 8 9 O WQRKSHEET #1 Lessor: City of Huntington Beach Public Works Vendor: GCS Incorporated 1126 E. Truslow Ave Fullerton CA 92631 Attn: Terry Roberts Equipment: 2/ea 1996 Tymco Model 600 w/Ford Model LN7000 truck chassis with diesel engine Cost: List $88,720.001ea $177,440.00 Sales Tax 7.75% $13,751.60 Freight $3,000.00 Set-up $600.001ea $1.200.00 Service Training $2,000.00 $197, 391.60 I. Trade in's $8,000.00/ea - 1 fi 000.00 Total Cost $181,391.60 Lessee: Koch Financial Corporation 4111 East 37th Street North Wichita, Kansas 67220 (Randy A. Bushman) Terms of Lease: 7 years Delivery date: April 5, 1996 (90 days) Interest Rate: 5.285% Frequency: Quarterly in arrears Amount: $7,792.53 Account # E-IQ-PW-858-702-00 Budget: $42,0001yr x 7 = $294,000.00 Paper Cost: $36,799.26 0016446.01 01 f26196 2:19 PM WORKSHEET #2 Lessor: City of Huntington Beach Public Works Vendor: Nixon Egli Equipment Co. 12030 Clark St. Santa Fe Springs, CA 90670 Attn: Ron C. Des Jarden Equipment: P-B Model B-5 Asphalt Patch Truck w11996 Ford F-800 chassis Cost: $88,232.00 Sales Tax 7.75% 6.837.98 $95,069.98 Trade In $2,000.00 Lessee: Koch Financial Corporation 4111 East 37th Street North Wichita, Kansas 67220 (Randy A. Bushman) Terms of lease: Delivery Date: Interest Rate: Frequency: Amount: Account #: Budget: Paper Cost: 5 years May 15, 1996 (130 days) 5.235% Quarterly in arrears $5,319.28 E-IQ-PW-863-702-00 $19,000.00/yr x 5 = $95,000.00 $13,315.58 $93,069.98 0016446.01 01/26/96 2:19 PM WORKSHEET #3 LENDERS: KOCH FINANCIAL M.L. STERN & CO. I MFG j GE CAPITAL I MPA FINANCIAL EQUIPMENT Quarterly P mts Quarterly P mts Orty P rots Quarterly P mts Quarterly P mts T mco Sweeper $8768.21 $8908.12 $8811.07 No Bid $8944.00 Asphalt Patch Truck $5486.74 $5548.34 $5494.24 $5530.11 Lump sum Tractor/Backhoe $4132.20 $4178.59 $4137.85 $4164.87 item #2,3,4 at: Zieman Trailer $731.57 $739.731 $732.571 $737.35 $10495.00 Fire Truck $13373.93 $13524.07 $13479.65 $13559.00 0 0016446.01 01126M 2:37 PM RCA ROUTING'SHEET INITIATING DEPARTMENT: Administrative Services SUBJECT: PW Equipment Lease COUNCIL MEETING DATE: February 5, 1996 :_ .RCA. ATTACHMENTS ..... STATUS Ordinance (w/exhibits & legislative draft if applicable) Not Apellicable Resolution (wlexhibits & legislative draft if applicable) Not Applicable Tract Map, Location Map and/or other Exhibits Not Applicable Contract/Agreement (wlexhibits if applicable) (Signed in full b the City Attome Attached Subleases, Third Party Agreements, etc. (Approved as to form by City Attome Not Applicable Certificates of Insurance (Approved by the City Attome Not Applicable Financial Impact Statement Unbudget, over $5,000 Not Applicable Bonds If applicable) Not Applicable Staff Report (If applicable) Not Applicable Commission, Board or Committee Report (If applicable) ot Applicable Findings/Conditions for Approval and/or Denial Not Applicable EXPLANATION.FOR MISSING.ATTACHMENTS ... REVIEWED RETURNED: FO Administrative Staff Assistant City Administrator initial City Administrator Initial Citv Clerk ( ) ....... .EXPL'ANATION FOR .:RETURWOF:.ITEM, ...: �z