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HomeMy WebLinkAbout5.816 Original Contract L.EAF F'inancial Corporation STATE AND LOCAL GOVERNMENT MASTER LEASE AGREEMENT This MASTER LEASE AGREEMENT ("Agreement") IS dated as of January 2, 2007, and IS by and between LEAF Funding, Inc., with offices located at 110 S Poplar Street, SUite 101, Wilmington, DE 19801, ItS successors and assigns ("Lessor") and City of Port Angeles, an agency, department or political subdiVISion of the State of Washington haVing chief executive offices located at 321 E 5th Street, Port Angeles WA 98362 ("Lessee") The parties hereto for good and valuable conslderalion and Intending to be legally bound hereby agree as follows 1 LEASE This Agreement establishes the general terms and conditions under which Lessor may, from lime to time, lease Systems (as hereinafter defined) to Lessee The terms hereof shail be deemed to form a part of each Master Lease Schedule (each a "Lease") executed by the parties which references thiS Agreement Items of "Equipment," "Licensed Materials," "Project Costs" and "Maintenance" shall be as Identified In each Lease and together With all other property descnbed therein and all substitutions: replacements, parts, additions and accessones thereto shall be collectively referred to as a "System" Lessee hereby requests Lessor to purchase the System from the suppller(s) thereof (hereinafter called "Vendor") and to lease the System to Lessee on the terms and conditions contained herein Each Lease shall constitute a separate lease agreement incorporating all the terms hereof In the event of a conflict between the provIsions of any Lease and the provIsions hereof, the provIsions of the Lease shall prevail 2 LEASE TERM AND PAYMENTS ThiS Agreement shall become effective upon acceptance and execution by Lessor and shall remain effective at least until the expiration of the term of the last Lease hereunder Each Lease shall become effective upon acceptance and execution by Lessor and shall be for the term provided therein The term of each Lease shall commence on the "Commencement Date," as defined In the Lease With an Intenm term and "Base Term Commencement Date" as set forth therein and shall thereafter continue unlil all obligations of the Lessee under the Lease shall have been fully performed ("Lease Term") The amount of the Lease Payments on each Lease ("Lease Payments") are based upon the estimated total cost of the System on the applicable Schedule The Lease Payments shall be adjusted proportionately upward or downward If the actual total cost of the System on the applicable Lease exceeds or IS less than the estimate, With such adjustment being confirmed In wntlng Intenm Rent and Base Term Rent shall be due and payable as set forth In the Lease All payments made by or on behalf of Lessee hereunder shall be nonrefundable LESSEE'S OBLIGATION TO PAY SUCH LEASE PAYMENTS SHALL BE ABSOLUTE AND UNCONDITIONAL AND IS NOT SUBJECT TO ANY ABATEMENT SET-OFF, DEFENSE OR COUNTERCLAIM FOR ANY REASON WHATSOEVER All payments hereunder shall be made to Lessor at ItS address specified above (or such other place as Lessor, In wntlng, directs) Without notice or demand therefor If the term of a Lease IS extended, "Lease Term" shall be deemed to refer to all extensions thereof Whenever any payment IS not made by Lessee Within ten (10) days of when due, Lessee agrees to pay to Lessor, not later than one month thereafter, an amount equal to the lesser of seven and one half percent (7 5%) of such delayed payment or the maximum amount permitted by applicable law as compensation for Lessor's Internal operating expenses anslng as a result of such delayed payment Such amount shall be payable In addition to all amounts payable by Lessee as a result of the exercise of any of the remedies herein provided 3 DELIVERY AND ACCEPTANCE As between Lessee and Lessor delivery and Installalion arrangements and costs are the sole responSibility of Lessee Lessee agrees to accept the System when delivered, Installed and operating to Vendor's specifications and to execute the Delivery and Acceptance Certificate supplied by Lessor as eVidence thereof Lessee agrees to hold Lessor harmless from specific performance of thiS Agreement and from damages, If for any reason, the Vendor falls to deliver, or delays In delivery of, the System so ordered or If the System IS unsatisfactory for any reason whatsoever Lessee's execullon of the Delivery and Acceptance Certificate shall conclUSively establish that the System covered thereby IS acceptable to Lessee for all purposes of the Lease related thereto If Lessee cancels or terminates a Lease pnor to the Commencement Date or If Lessee falls or refuses to sign the Delivery and Acceptance Certificate Within a 5. ~/l.p ~ C\.~ reasonable time, not to exceed five (5) bUSiness days, after the System has been delivered, Installed and IS operating to Vendor's specifications, Lessor shall have the option of treating the Lease as cancelled by Lessee and Lessee shall automatically assume all of Lessor's nghts and obligations as purchaser of the System, whether under an AcqUISition Agreement or otherwise If Lessee has entered Into any purchase, licenSing, maintenance or Similar agreements With the Vendor (each an "Acquisition Agreement") covenng the System or any portion thereof, Lessee transfers and assigns to Lessor all of Lessee's nghts, but none of ItS obligations (except for Lessee's obligation to pay for the System, to the extent approved by Lessor, upon Lessor's acceptance of the Lease), With respect to the AcqUiSition Agreement, including Without limitation the nght to take title to the System 4 SELECTION OF SYSTEM AND DISCLAIMER OF WARRANTY If the System IS not properly Installed, does not operate as represented or warranted by the Vendor, or IS unsatisfactory for any reason, Lessee shall make any claim on account thereof solely against the Vendor and shall, nevertheless, pay Lessor all Lease Payments under the Lease and shall not set up against Lessee's obligations any such claims as a defense, counterclaim, set-off or otherwise So long as Lessee IS not In breach or default of thiS Agreement or any Lease hereunder, Lessor hereby assigns to Lessee any nghts which Lessor may have against the Vendor for breach of warranty or other representation respecting any Item of the System All proceeds of any warranty recovery by Lessee from the Vendor of any Item of the System shall first be used to repair or replace the affected Item NOTWITHSTANDING ANY PROVISION CONTAINED HEREIN TO THE CONTRARY, LESSEE DOES NOT WAIVE ANY RIGHTS OR REMEDIES IT MAY HAVE AGAINST THE VENDOR OF THE SYSTEM Lessee has selected both the System and the Vendor from whom Lessor covenants to purchase the System at Lessee's request LESSEE ACKNOWLEDGES THAT LESSOR HAS NO EXPERTISE OR SPECIAL FAMILIARITY ABOUT OR WITH RESPECT TO THE SYSTEM LESSEE AGREES THAT THE SYSTEM LEASED HEREUNDER IS LEASED "AS-IS" AND IS OF A SIZE, DESIGN AND CAPACITY SELECTED BY LESSEE AND THAT LESSEE IS SATISFIED THAT THE SAME IS SUITABLE FOR LESSEE'S PURPOSES, AND THAT LESSOR HAS MADE NO REPRESENTATION OR WARRANTY WITH RESPECT TO THE SUITABILITY OR DURABILITY OF SAID SYSTEM FOR THE PURPOSES AND USES OF LESSEE, OR ANY OTHER REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT THERETO, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE LESSOR FURTHER DISCLAIMS ANY LIABILITY FOR LOSS, DAMAGE OR INJURY TO LESSEE OR THIRD PARTIES AS A RESULT OF ANY DEFECTS, LATENT OR OTHERWISE, IN THE SYSTEM WHETHER ARISING FROM THE APPLICATION OF THE LAWS OF STRICT LIABILITY OR OTHERWISE LESSEE ACKNOWLEDGES THAT NEITHER THE VENDOR NOR ANY SALESPERSON, EMPLOYEE, REPRESENTATIVE OR AGENT OF THE VENDOR IS AN AGENT OR REPRESENTATIVE OF LESSOR AND THAT NONE OF THE ABOVE IS AUTHORIZED TO WAIVE OR ALTER ANY TERM, PROVISION OR CONDITION OF THIS AGREEMENT OR ANY LEASE HEREUNDER, OR MAKE ANY REPRESENTATION OR WARRANTY WITH RESPECT TO THIS AGREEMENT, ANY LEASE HEREUNDER OR THE SYSTEM LEASED HEREUNDER REGARDLESS OF CAUSE, LESSEE WILL NOT ASSERT ANY CLAIM WHATSOEVER AGAINST LESSOR FOR LOSS OF ANTICIPATORY PROFITS OR ANY OTHER INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES, NOR SHALL LESSOR BE RESPONSIBLE FOR ANY DAMAGES OR COSTS WHICH MAY BE ASSESSED AGAINST LESSEE IN ANY ACTION FOR INFRINGEMENT OF ANY UNITED STATES LETTERS PATENT OR COPYRIGHT LESSOR MAKES NO WARRANTY AS TO THE TREATMENT OF THIS AGREEMENT OR ANY LEASE HEREUNDER FOR TAX OR ACCOUNTING PURPOSES 5 TITLE, PERSONAL PROPERTY AND LOCATION The EqUipment IS, and shall at all times be and remain the sole and exclUSive property of Lessor, and Lessee, notWithstanding any trade-In or down payment made by Lessee or on ItS behalf With respect to the EqUipment, shall have no nght, title or Interest therein or thereto, except as to the use thereof subject to the terms and conditions of thiS Agreement and the related Lease hereunder NotWithstanding anything to the contrary In thiS Agreement or any Lease, Page 1 of 5 1 0-5-05 neither this Agreement nor any Lease grants any nght, title or Interest In or to that portion of any System constituting or contammg software and/or operation manuals, plans, specifications and documentatton related thereto (collectively, "Licensed Materials") Any nghts that Lessee may have with respect to Licensed Matenals shall anse only pursuant to license agreements between Lessee and the licensor(s) of such Licensed Matenals (collectively, the "Licensors") which license agreements (the "LIcenses") may be contamed within the packaging associated with the System All title to and ownership of the Licensed Matenals (together with all nghts In patents, copynghts, trade secrets and other Intellectual property nghts applicable thereto) are and shall remain In the Licensors dunng and after the term of thiS Agreement Any use of the terms "sell," "purchase," "license," "lease," and the like In thiS Agreement or any Lease with respect to Licensed Matenals shall be Interpreted In accordance with thiS Section 5 Lessee will not directly or Indirectly create, mcur, assume or suffer to eXist any lien on or with respect to the System or Lessor's Interest thereto, except such liens as may anse through the Independent acts or omissions of the Lessor Lessee, at ItS own expense, will promptly pay, satisfy or otherwise take such actions as may be necessary to keep the System free and clear of any and all such liens The System IS, and at all times shall remain, personal property notwlthstandmg that the System or any Item thereof may now be, or hereafter become, m any manner affixed or attached to, or Imbedded In, or permanently resttng upon real property or any Improvement thereof or attached In any manner to what IS permanent If requested by Lessor pnor to or at any time dunng the Lease Term, Lessee will obtain and deliver to Lessor waivers of Interest or liens In recordable form, sattsfactory to Lessor, from all persons claiming any Interest In the real property on which an Item of the System IS Installed or located The System shall be kept at the address deSignated In each Lease and shall not be removed therefrom without the pnor wntten consent of the Lessor, which consent shall not be unreasonably withheld Lessor may reqUIre plates or markings to be affixed to or placed on the EqUipment Indicating the Lessor's ownership of the EqUipment 6 USE, MAINTENANCE AND INSPECTION Lessee shall use the System solely In the conduct of ItS bUSiness and m a careful and proper manner consistent with the reqUIrements of all applicable Insurance policies and shall permit only qualified personnel to operate the System Lessee will not modify the System In any way without the pnor wntten consent of Lessor, which consent shall not be unreasonably withheld Lessee shall not attach or mcorporate the EqUipment or LIcensed Matenals to or In any other Item of equipment or software In such a manner that the EqUipment or Licensed Matenals becomes or may be deemed to have become an accession to or a part of such other Item of equipment or software If any parts or accessones forming part of the System become worn out, lost, destroyed, damaged beyond repair or otherwise permanently rendered unfit for use, Lessee, at ItS own expense, shall within a reasonable time cause such parts or accessones to be replaced by replacement parts or accessones which are free and clear of all liens, encumbrances or nghts of others and have a utility at least equal to the parts or accessones replaced All equipment, Licensed Matenals accessones, upgrades, parts and replacements for or which are added to or become attached to the System, which are essential to the operation of the System or which cannot be detached from the System without matenally Interfenng with the operation of the System or adversely affecting the value and utility which the System would have had wIthout the addItion thereof, shall Immediately become the property of Lessor, and shall be deemed Incorporated In the System and subject to the terms of thiS Agreement and the related Lease as If onglnally leased hereunder Lessee shall not make any matenal alterations to the System without the pnor wntten consent of Lessor, which consent shall not be unreasonably withheld Upon reasonable advance notice, Lessor shall have the nght to Inspect the System and all mamtenance records with respect thereto, If any, at any reasonable time dunng normal bUSiness hours At ItS own expense, Lessee Will cause the System to be kept, used and maintained as recommended by the Vendor and Vendor's maintenance manuals and plans by competent and duly qualified personnel In accordance with applicable governmental regulations, If any, and In as good operating condition as when delivered to Lessee hereunder, ordinary wear and tear resulting from proper use alone excepted In the event the Lease Payments mclude the cost of mamtenance and/or service being proVided by Vendor, Lessee acknowledges that Lessor IS not responsible for provldmg any reqUired maintenance and/or service for the System Lessee shall make all claims for service and/or maintenance solely to the Vendor and Lessee's obligation to make all required Lease Payments shall remam unconditional 7 ASSIGNMENT LESSEE MAY NOT ASSIGN THIS AGREEMENT, ANY LEASE OR THE RIGHTS HEREUNDER, NOR SHALL THE LESSEE SUBLEASE OR LEND THE SYSTEM OR SUBMIT IT TO BE USED BY ANYONE OTHER THAN LESSEE'S EMPLOYEES WITHOUT THE PRIOR WRITTEN CONSENT OF LESSOR, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD Lessor may at any time assign all or part of any Interest In thiS Agreement or any Lease and In each Item of the System and monies to become due to Lessor hereunder, and, Lessor may grant secunty Interests In the System, subject to the Lessee's nghts therein In such events, all the provIsions of thiS Agreement or any Lease hereunder for the benefit of Lessor shall Inure to the benefit of and be exercised by or on behalf of such ASSignee or transferee of any of Lessor's nghts, title and mterests hereunder (an "Assignee"), but the ASSignee shall not be liable for or be reqUired to perform any of Lessor's obligations to Lessee The Lessor may direct that all Lease Payments due and to become due under thiS Agreement or any Lease hereunder and aSSigned by Lessor shall be paid directly to ASSignee, upon notice of such assignment to Lessee The nght of the ASSignee to the payment of the aSSigned Lease Payments, the performance of all Lessee's obligations and to exercise any other of Lessor's nghts hereunder shall not be subject to any defense, counterclaim or set-off which the Lessee may have or assert against the Lessor, and the Lessee hereby agrees that It Will not assert any such defenses, set-offs, counterclaIms and claims against the ASSignee No such assignment by Lessor shall relieve Lessor of ItS obligations or limit or otherwise affect Lessee's nghts and/or obligations hereunder 8 RETURN OF SYSTEM The Lessee shall, at ItS sole expense, surrender each Item of the System then subject to any Lease hereunder at the expiration or earlier termlnatton of the Lease Term by prOViding the reqUIred notice to Lessor and delivenng the Item to the Lessor at a location deSignated by the Lessor Within the Continental United States In the case of Licensed Matenals, Lessee shall terminate ItS use of all Licensed Matenals and assign to Lessor all of Lessee's nghts under the applicable Licenses Lessee shall arrange for the return shipment of the System, Includmg the Licensed Matenals, and ItS Insurance m transit m accordance With the Lessor's Instructtons and at the Lessee's sole expense When an Item of the Licensed Matenals or EqUipment IS surrendered to the Lessor It shall be m the condition and repair reqUired to be maintained under thiS Agreement It Will also be free of all eVidence of advertiSing or Insignia placed on It by the Lessee and meet all legal and regulatory requirements and be free of all liens If Lessor reasonably determines that an Item of Licensed Matenals or EqUipment, once It IS returned, IS not In the condition reqUired hereby, Lessor may cause the repair, service, upgrade, modification or overhaul of the Item of Licensed Matenals or EqUipment to achieve such condition and upon demand, Lessee shall promptly reimburse Lessor for all amounts reasonably expended m connection With the foregOing Upon request, Lessee shall certify In wnttng to Lessor that Lessee has ceased all use of the Licensed Matenals Should Lessee not return the System (or any portion thereof) at the end of the Lease Term, or continue to use the Licensed Matenals, Lessee shall continue to make Lease Payments to Lessor In the sum equal to the last Lease Payment and at the same Intervals as set out In the Lease as a month- to-month lease term (or other term as deSignated by Lessor) until, With proper notice, the System IS returned by Lessee The acceptance of said Lease Payments by Lessor shall not waive Lessor's nght to have the System promptly returned to Lessor pursuant to the provIsions hereof, nor shall the acceptance of said Lease Payments be deemed to be an extension of the Lease Term 9 RISK OF LOSS Lessee hereby assumes and shall bear the entire nsk of loss (Including theft, requIsition of use, erasure or moperabllity) or destructton of or damage to the System from any and every cause whatsoever, whether or not Insured, until the System IS returned to Lessor No such loss or damage shall relieve Lessee from any obllgatton under thiS Agreement or any Lease hereunder, which shall continue In full force and effect In the event of damage to or loss or destruction of the System (or any Item thereof), Lessee shall promptly notify Lessor In wntlng of such fact and shall, at the option of Lessor, (a) place the same In good repair, condition and working order, (b) replace the Licensed Matenals and/or EqUipment With like Licensed Matenals and/or EqUipment In good repair, condition and working order, acceptable to Lessor and transfer clear title to or a nght to use, as appropnate, such Licensed Matenals and/or replacement EqUipment to Lessor, whereupon such Licensed Matenals and/or EqUipment shall be subject to the Lease and be deemed the System for purposes hereof, or (c) on the due date for the next Lease Payment or upon the expiration of the Lease, whichever first occurs, pay to Lessor all amounts then due but unpaid, plus the present value of the total of all unpaid Lease Payments for the entire Lease Term plus the estimated fair market value of the System at the end of the ongmally scheduled Lease Term or the agreed upon purchase option pnce, If any, all of Page 2 of 5 10-5-05 which shall be discounted to the date of payment by Lessee at an annual rate equal to the lesser of four percent (4%) or the rate then available for United States Treasury obligations having an average life equal to one half of the remaining Lease Term ("Present Value Rate"), plus all taxes, whereupon the Lease shall terminate with respect thereto 10 INSURANCE Prior to the Lease Commencement Date, Lessee shall obtain, maintain and keep the System Insured against all risks of loss or damage, In an amount not less than the replacement cost or Stipulated Loss Value of the System, whichever IS greater, without deductible and without co- Insurance Lessee shall maintain such Insurance coverage for the enllre Lease Term Lessee shall also obtain and maintain for the entire Lease Term, comprehenSive public liability Insurance covering liability for bodily Injury, Including death, and property damage resulting from the purchase, ownership, leasing, maintenance, use, operallon or return of the System with a combined Single limit of not less than Two Million Dollars ($2,000,000) per occurrence All said Insurance shall be In a form and an amount and with companies reasonably satisfactory to Lessor Lessor, ItS successors or assigns, shall be the sole named loss payee with respect to Insurance for damage to or loss of the System and shall be named as an additional Insured on the public liability Insurance Lessee shall pay all premiums for such Insurance and shall deliver to Lessor certificates of Insurance, or other eVidence satisfactory to Lessor eVidencing the Insurance reqUired hereby, along with proof, satisfactory to Lessor, of the payment of the premiums for such Insurance poliCies All Insurance shall provide for at least thirty (30) days advance written notice to Lessor before any cancellation, expiration or material modification thereof and also provide that no act or default of any person other than Lessor, ItS agents or those claiming under Lessor, Will affect Lessor's right to recover under such policy or poliCies In case of loss Lessee hereby Irrevocably appoints Lessor as Lessee's attorneY-in-fact (which power shall be deemed coupled With an Interest) to make claim for, receive payment of, and execute and endorse all documents, checks or drafts received In payment for loss or damage under any such Insurance policy Unless Lessee IS In default, Lessee may With the prior written approval of Lessor, settle and adjust all such claims Lessee agrees If Lessee shall fail to procure, maintain, and pay for such Insurance, Lessor shall have the right, but not the obligation, to obtain such Insurance on behalf of and at the expense of Lessee In the event Lessor does obtain such Insurance, Lessee agrees to pay all costs thereof With the next Lease Payment or as specified by Lessor Alternatively, Lessor may forego acquIring Insurance on Lessee's behalf and charge Lessee a monthly administrative fee for Lessor's costs In monitoring and administering such defiCiency and Lessee shall remain liable for any damage to or caused by the System 11 INDEMNIFICATION To the extent not prohibited by applicable law, Lessee assumes and agrees to Indemnify, defend and keep harmless Lessor, ItS agents and employees, from and against any and all losses, damages, InJUrieS, claims, demands and expenses, Including legal, consulting and expert expenses (other than such as may directly and proXimately result from the gross negligence or Willful misconduct of Lessor, ItS agents or employees), arising on account of the ordering (whether by AcqUISition Agreement or otherwise), acquIsition, delivery, Installation or rejection of the System, the posseSSion, maintenance, use, condition (including Without limitation, latent and other defects, any claim In tort for strict liability, and any claim for patent, trademark or COPYright Infringement) or operation of any Item of the System, and by whomsoever used or operated, dUring the Lease Term With respect to that Item of the System, the loss, damage, destruction, environmental Impact, removal, return, surrender, sale or other diSpOSition of the System, or any Item thereof Lessor shall give Lessee notice of any claim or liability hereby Indemnified against The obligations contained In thiS paragraph continue beyond the termination of the Lease If the liability occurred dUring the Lease Term 12 EVENTS OF DEFAULT The term "Event of Default" shall mean any one or more of the follOWing (a) Lessee shall fall to make any Lease Payment, or any other payment under any Lease, as It becomes due and such failure IS not cured Within ten (10) days, or (b) Lessee shall fall to perform or observe any of the covenants set forth In Paragraph 10, or (c) Lessee shall fall to perform or observe any other covenant, condition or agreement to be performed or observed by It hereunder or In any Lease and such failure IS not cured Within 30 days after the date of notice thereof by Lessor to Lessee, or (d) Lessee shall enter Into any transaction of merger or consolidation In which It IS not the surviving entity or sell, transfer or otherwise dispose of all or substantially all of ItS assets ("Assets") unless the surviVing entity or the entity acquIring such Assets assumes all the duties and obligations of Lessee hereunder and which merger, consolidation, sale or transfer must be approved In wrllIng by Lessor, or (e) (I) Lessee or any guarantor of Lessee's obligations hereunder ("Guarantor") shall commence any action (A) for relief under any eXisting or future law of any JUrisdiction, domestic or foreign, relating to bankruptcy, Insolvency, reorganization or relief of debtors, or (B) seeking appointment of a receiver, custodian or other Similar offiCial for It or for ItS Assets or making a general assignment for the benefit of ItS creditors, or (II) there shall be commenced against Lessee any action (A) of a nature referred to In clause (I) which results In the entry of an order for relief or any such other relief and remains undlsmlssed or undischarged for a period of 30 days, or (B) seeking attachment, execullon or Similar process against ItS assets which results In the entry of an order for any such relief which shall not be vacated or discharged Within 30 days from the entry thereof, or (III) Lessee shall generally not, or be unable to, pay ItS debts as they come due, or (f) Lessee or any Guarantor shall die or (If an entity) liqUidate or dissolve Itself or be liqUidated or terminated, or (g) Any representation or warranty made by Lessee herein or otherwise furnished Lessor In connection With thiS Agreement or any Lease hereunder shall prove at any time to have been untrue or misleading In any material respect, or (h) Lessee or any Guarantor defaults on any Indebtedness for borrowed money, lease, or Installment sale obligation to Lessor or any affiliate of Lessor when any applicable grace period for such obligation has expired, or (I) Lessee or any Guarantor defaults on any Indebtedness for borrowed money, lease, or Installment sale obligation, In each case when any applicable grace period for such obligation has expired and the lender, lessor or creditor has commenced to exercise any remedy, but only If the Indebtedness or other obligation IS In an amount equal to or In excess of $50,000, or (J) Lessor shall reasonably deem Itself Insecure as a result of a material adverse change In Lessee's finanCial condition, operations or ownership, or (k) Lessee shall default In ItS obligations under a License 13 REMEDIES Upon the occurrence of any Event of Default, Lessor may declare thiS Agreement or any Lease hereunder to be In default and exercise anyone or more of the follOWing remedies (a) declare the entire unpaid balance of Lease Payments for the unexpired term of the Lease hereunder Immediately due and payable and Similarly accelerate the balances due under any other Leases between Lessor and Lessee Without notice or demand, (b) sue for and recover all Lease Payments and other monies due and to become due under the Lease hereunder, plus the estimated fair market value of the System at the end of the Originally scheduled Lease Term or any agreed upon Purchase Option, all of which shall be discounted to the date of default at the Present Value Rate (defined In Section 9 hereof), but only to the extent permitted by law, (c) charge Lessee Interest on all monies more than thirty days past due Lessor at the lesser of one and one half percent (1 5%) per month or the maximum rate permitted by law from the date of default until paid, (d) require Lessee to assemble all EqUipment and Licensed Materials at Lessee's expense, at a place reasonably deSignated by Lessor and/or (e) remove any phYSical obstructions for removal of the EqUipment from the place where the EqUipment IS located and take possession of any or all Items of System, Without demand or notice, wherever same may be located, disconnecting and separating all such Items of the System from any other property Lessee hereby waives any and all damages occaSioned by such retaking except such damages as may be caused by Lessor's gross negligence or Willful misconduct Lessor may, at ItS option, use, Ship, store or repair any or all Items of the System so removed and shall sell, lease or otherwise dispose of any such System at a private or publiC sale In the event Lessor disposes of the System, Lessor shall give Lessee credit for any sums received by Lessor from the sale or lease of the System after deduction of the expenses of sale or lease Lessee shall also be liable for and shall pay to Lessor (I) all expenses Incurred by Lessor In connection With the enforcement of any of Lessor's remedies, including all expenses of repossessing, storing, shipping, repairing and selling the System, and (II) to the extent not prohibited by applicable law, Lessor's reasonable attorney's fees and expenses Lessor and Lessee acknowledge the difficulty In establishing a value for the unexpired Lease Term and oWing to such difficulty agree that the prOVISions of thiS paragraph represent an agreed measure of damages and are not to be deemed a forfeiture or penalty All remedies of Lessor hereunder are cumulative, are In addition to any other remedies proVided for by law, and may, to the extent permitted by law, be exerCised concurrently or separately The exercise of anyone remedy shall not be deemed to be an election of such remedy or to preclude the exercise of any other remedy No failure on the part of the Lessor to exercise and no delay In exercIsing any right or remedy shall operate as a waiver thereof or modify the terms of thiS Agreement or any Lease hereunder A waiver of default shall not be a waiver of any other or subsequent default Lessor's recovery hereunder shall In no event exceed the maximum recovery permitted by law Notwithstanding any prOVISion contained herein to the Page 3 of 5 10-5-05 contrary, the termination or cancellation of a Lease shall not affect Lessee's duty to perform Lessee's obligations under such Lease to Lessor In full 14 LAWS, REGULATIONS AND TAXES Lessee shall comply with all laws, regulations and orders relating or pertaining to the System, this Agreement or any Lease hereunder and Lessee shall be responsible for, as and when due, and shall indemnify and hold Lessor harmless from and against all present and future taxes and other governmental charges, or any Increases therein (Including, without limitation, sales, use, leasing and stamp taxes and license and registration fees) and amounts In lieu of such taxes and charges and any penalties or Interest on any of the foregoing, Imposed, levied upon, In connection with, or as a result of the purchase, ownership, delivery, leasing, possession or use of the System, or based upon or measured by the Lease Payments or receipt with respect to thiS Agreement or any Lease hereunder Lessee shall not, however, be obligated to pay any taxes on or measured by Lessor's net Income Lessee authonzes Lessor to add to the amount of each Lease Payment any sales, use or leasing tax that may be Imposed on or measured by such Lease Payment Lessee shall pay Lessor on demand, as additional rent, the amount of the personal property tax reqUired to be paid by Lessor as owner of the System, plus reasonable costs Incurred In collecllng and admlnlstenng any taxes, assessments or fees and remitting them to the appropnate authontles In the event Lessee does not pay all sums speCified above, Lessor has the nght, but not the obligation, to pay the same If Lessor shall so pay any of the aforementioned, then the Lessee shall remit such amount with the next Lease Payment Upon direction by Lessor, Lessee shall file the personal property tax declaration, pay the personal property tax for each System location and forward to Lessor at Lessor's request a copy of the personal property tax declaration listing the System The obligations contained In thiS Section shall continue beyond the termination of the Lease If the obligations occurred dunng the Lease Term 15 FURTHER ASSURANCES, UCC FILINGS Lessee shall execute and deliver to Lessor upon Lessor's request such further and additional documents, Instruments and assurances as Lessor deems necessary (a) to acknowledge and confirm, for the benefit of Lessor or any Assignee, all of the terms and conditions of all or any part of thiS Lease and Lessor's or Assignee's nghts with respect thereto, and Lessee's compliance with all of the terms and provIsions hereof and (b) to preserve, protect and perfect Lessor's or Assignee's nght, title or Interest hereunder and In any System, including, without limitation, such Uniform Commercial Code ("UCC") financing statements or amendments, control agreements, corporate resolullons, certificates of compliance, notices of assignment or transfers of Interests, and restatements and reaffirmations of Lessee's obligations and ItS representations and warranties with respect thereto as of the dates requested by Lessor from time to time In furtherance thereof, Lessor may file or record thiS Lease or a memorandum or a photocopy hereof (which for the purposes hereof shall be effective as a finanCing statement) so as to give notice to third parties, and Lessee hereby Irrevocably authonzes Lessor to file and record, and appoints Lessor as ItS attorneY-In-fact to execute (If applicable), file and record, UCC flnancmg statements, amendments thereto and other lien recordation documents with respect to the System, ratifies such authonzatlon and appointment with respect to any UCC finanCing statements or amendments thereto pnor to the date of any Lease, and Lessee agrees to payor reimburse Lessor for any lien searches, filing, recording or stamp fees or taxes anslng from or relating to any such filings and for Lessor's other documentation costs Lessee hereby covenants and agrees that It shall not file any corrective or termination statement with respect to any UCC finanCing statements recorded by or for the benefit of Lessor with respect to the EqUipment without Lessor's pnor wntten consent It IS the mtent of the parties that each Lease IS a true lease, and the filing of a finanCing statement under the UCC or other applicable law shall not be construed as eVidence that any secunty mterest was Intended to be created, but only to give public notice of Lessor's ownership of the System Lessee hereby grants to Lessor, to secure the payment and performance In full of all of Lessee's obligations under the Leases, a secunty Interest In all Items of System subject to a Lease In which Lessee may now or hereafter have nghts, and all parts, accessones, accessions and attachments thereto, and all replacements, Substitutions and exchanges (Including trade-ins) for such goods, together with proceeds of all of the foregOing, Including proceeds in the form of goods, accounts, chattel paper, documents, Instruments, general Intangibles, Investment property, depOSit accounts, letter of credit nghts and supporting obligations (the "Collateral"), prOVided that with respect to any Lease, the foregOing grant of a secunty Interest IS made on a precautionary baSIS and shall not of Itself be a factor In determining whether the Collateral secures an obligation or whether the Lease creates a secunty Interest 16 LESSEE REPRESENTATIONS AND WARRANTIES Lessee hereby represents, warrants and covenants to Lessor the following with respect to each Lease as of the date Lessee executes the Delivery and Acceptance Receipt related thereto (a) Lessee IS organized and validly eXisting under the laws of the state of ItS organization, with adequate power and capacity to enter Into the Lease, all documents related to the purchase of the System and any other documents required to be delivered In connection with the Lease or the System (hereinafter "Documents") and IS duly qualified to do bUSiness wherever necessary to carry on ItS present bUSiness, Including all states where the System IS to be located, and Lessee will not change ItS form or state of organization without the pnor wntten consent of Lessor, (b) the Documents have been duly authonzed, executed and delivered by Lessee and conslitute valid, legal and binding agreements, enforceable In accordance with their terms, except as may be limited under applicable bankruptcy and Insolvency laws, (c) no approval, consent or withholding of objections IS required from any federal, state or local governmental authonty or Instrumentality with respect to the entry Into or performance by Lessee of the Documents, except such as have already been obtained, (d) the entry Into and performance by Lessee of ItS obligations under the Documents will not (I) violate any Judgment, order, law or regulation applicable to Lessee or (II) result m any breach of, constitute a default under or result In the creation of any lien, charge, secunty Interest or other encumbrance upon any Item of the System pursuant to any Indenture, mortgage, deed of trust, bank loan or credit agreement or other Instrument (other than the Lease or any purchase money secunty Interest retained by any supplier) to which Lessee IS a party, (e) there are no SUitS or proceedings pending or threatened In court or before any regulatory commiSSion, board or other administrative governmental agency against or affectmg Lessee, which will have a matenal adverse effect on the ability of Lessee to fulfill ItS obligations under the Lease, (f) the balance sheet and statement of Income of Lessee, or of any consolidated group of which Lessee IS a member, heretofore delivered to Lessor have been prepared In accordance with generally accepted accounting pnnclples and fairly present the financial POSition of Lessee on and as of the date thereof and the results of ItS or their operallons for the penod or penods covered thereby, (g) the EqUipment, subject to any Lease, IS essential to the Immediate performance of a governmental or propnetary function by Lessee within the scope of ItS authonty and will be used dunng the Term of such Lease only by Lessee and only to perform such function, (h) Lessee Intends to use the EqUipment for the entire Term of such Lease and all EqUipment will be used for bUSiness purposes only and not for personal, family or household purposes, (I) Lessee has complied fully with all applicable law governmg open meetmgs, public bidding and appropnatlons required In connection with thiS Lease and the acquIsition of the EqUipment, (j) there has been no matenal change In the budget for Lessee's current Fiscal Penod Since ItS adoption, (k) Lessee's obligations to pay Rent and any other amounts due under thiS Lease constitute a current expense and not a debt of Lessee under applicable state law, and (I) no provIsion of thiS Lease constitutes a pledge of the tax or general revenues of Lessee Since the date of such balance sheet and statement of Income there has been no matenal adverse change In the financial or operating condition of Lessee or of ItS consolidated group Lessee acknowledges that Lessor has relied upon thiS representation In entenng Into thiS Agreement and each Lease hereunder 17 NOTICES Wntten notices to be given hereunder shall be deemed to have been given when delivered personally or deposited In the United States malls or nationally recognized delivery service, postage prepaid, addressed to such party at ItS address set forth above or at such other address as such party may have subsequently proVided in wnling 18 SUPPLIER'S CONTRACT AND LESSEE'S WAIVERS Lessor and Lessee agree that each Lease IS a Finance Lease as that term IS defined In Article 2A of the UCC Lessee acknowledges that Lessor has appnsed Lessee of the Identity of the System supplier Lessor hereby notifies Lessee that Lessee may have nghts pursuant to the contract with the supplier and the Lessee may contact the supplier for a descnptlon of any nghts or warranties that Lessee may have under thiS contract Lessee hereby waives any and all nghts and remedies granted Lessee by Sections 303 and 508 through 522 of Article 2A of the UCC The waivers contained herein shall not constitute a waiver by Lessee of any of ItS nghts or remedies against the Vendor of the System 19 FINANCIAL STATEMENTS Lessee agrees to submit financial statements or tax returns If ItS financial statements are unaudited within 90 days from the end of ItS fiscal year and Lessee warrants to Lessor that all financial statements furnished and to be furnished have been and Will be prepared In accordance with generally accepted accountmg pnnclples, are an Page 4 of 5 10-5-05 accurate reflection of Lessee's fmanclal condition and that there has been no matenal adverse change m the financial condition of Lessee or any guarantor of Lessee's obligations smce the dates of preparallon and submiSSion of the financial statements submitted to Lessor Lessee agrees to deliver to Lessor at any time or times hereafter such Informalion or documents, mcludlng, without limitation, certified resolutions, financial statements and legal opinions, as Lessor may request 20 CHOICE OF LAW This Agreement and each Lease hereunder shall be deemed to have been made In Washmgton and, except for local filing requirements and laws relating to conflict of laws, shall be governed by and construed In accordance with the laws of the State of Washington Lessee hereby consents to and agrees that personal junsdlctlon over Lessee and subject matter junsdlctlon over the System shall be with the state or federal courts In Washington with respect to any provIsion of this Agreement or any Lease hereunder Lessee agrees that service of process m any action or proceeding may be duly effected upon Lessee by mailing such process via certified mall, return receipt requested Lessee also agrees to waive ItS nght to a tnal by JUry 21 NONAPPROPRIATION Notwithstanding anythmg contained In thiS Agreement to the contrary, m the event that suffiCient funds are not Date appropnated and budgeted by Lessee's governing body or are not otherwise available from other legally available sources m any fiscal penod for the payment of Lease Payment and other amounts due under any Lease, the Lease shall term mate on the last day of the fiscal penod for which appropnatlons were received or other amounts are available to pay amounts due under the Lease without penalty or expense to Lessee of any kmd whatsoever, except as to the portions of Lease Payments or other amounts herein agreed upon for which funds shall have been appropnated or are otherwise available Lessee Will Immediately notify the Lessor or ItS assignee of such occurrence In the event of such termination, Lessee shall Immediately cease all use of the System, and shall, at ItS sole expense and nsk, Immediately de-mstall, disassemble, pack, crate, msure, and return the System subject to such Lease to Lessor (all In accordance with Section 8 of thiS Agreement) Such Equipment shall be In the same condition as when received by Lessee (reasonable wear, tear and depreciation resulting from normal and proper use excepted), shall be In good operatmg order and mamtenance as required by the Lease, shall be free and clear of any liens (except Lessor's lien) and shall comply with all applicable laws and regulations Lessee agrees to execute and deliver to Lessor all documents reasonably requested by Lessor to eVidence the transfer of legal and benefiCial title to such Equipment to Lessor and to eVidence the termination of Lessee's mterest In such Equipment Lessor Will have all legal and equitable nghts and remedies to take possession of the Equipment If Lessee exercises any nght to term mate a Lease due to non-appropnatlon of funds, Lessee shall not replace the System with functionally Similar equipment or products for a penod of one year follOWing the effective date of such termmatlon At Lessor's request, Lessee shall promptly prOVide supplemental documentation as to such Non-Appropnatlon satisfactory to Lessor Lessee's exercise of ItS nghts pursuant to thiS Section 21 shall not affect the survival of any Indemnity and other prOVISions (other than the obligalion to lease the Equipment and pay amounts due under the Lease) which survive the termlnallon of the Lease 22 ENTIRE AGREEMENT, NON-WAIVER AND SEVERABILITY ThiS Agreement and each Lease hereunder contain the entire agreement and understanding between Lessee and Lessor relaling to the subject matter of each Lease No agreements or understandmgs shall be bmdmg on the parties hereto unless set forth In wntlng and Signed by the parties All obligations of the Lessee, If more than one, shall be jomt and several No waiver by Lessor of any breach or default shall constitute a waiver of any additional or subsequent breach or default by Lessor nor shall It be a waiver of any of Lessor's nghts Any provIsion of thiS Agreement or any Lease hereunder which for any reason may be held unenforceable In anyone junsdlclion shall, as to such jUnSdlctlon, be Ineffeclive to the extent of such unenforceabllity without mvalidatlng the remaining provISions of thiS Agreement or any Lease hereunder, and any such unenforceabllity In anyone junsdlctlon shall not render such prOVIsion unenforceable In any other junsdlclion Any signature, execution and delivery of any document or Instrument may be satisfied, In Lessor's sole dlscrelion and to the extent permitted by the UCC, by authentication of such document or Instrument as a record wlthm the meanmg of Article 9 of the UCC Page 5 of 5 IN WITNESS WHEREOF, the parties hereto have caused thiS Agreement to be duly executed by their authonzed representatives as of the date first above wntten LEESSEE City. of Port An.gele~ By 741~~''n161.~ PnntName p~ 'E. MA.7)S~N TItle Date By Pnnt Name Title 10-5-05 . LEAF jlINAN~tM.f G{YI{ITotO"Wfl MASTER LEASE SCHEDULE This Master Lease Schedule No 1 ("Lease") IS by and between LEAF Funding, Inc. ("Lessor") and City of Port Angeles ("Lessee") and Incorporates the terms and conditions of that certain Master Lease Agreement dated as of January 2, 2007 between Lessor and Lessee ("Master Lease") Lessor hereby leases to Lessee and Lessee hereby leases from Lessor the following descnbed Items of Equipment, Licensed Matenals, Maintenance and/or Project Costs (collectively, the "System") for the Lease Term and on terms and conditions set forth herein The Lease shall become effective as against Lessor upon Lessor's execution hereof 1 SYSTEM (see Attachment A) SYSTEM LOCATION 321 E 5th Street BILLING ADDRESS (If other than System location) PO Box 1150 Port Angeles, WA 98362 Port Angeles, WA 98362 2 LEASE TERM The Lease shall commence on the day that Lessee executes a Delivery and Acceptance Certificate With respect to the System ("Commencement Date") The Base Lease Term of the Lease shall be for the term Indicated below and shall commence on the first day of the calendar month following the Commencement Date ("Base Term Commencement Date") Base Lease Term 36 months (3 annualized payments In advance) 3 LEASE PAYMENTS (a) Base Term Rent consists of the following annual payments 1-3 $2182061 $ $ TBD Total $2182061 + taxes Number Amount Taxes $ $ $ $ The first Installment of Base Term Rent shall be due and payable upon the date specified In Lessor's InVOice therefor, With the remaining Base Term Rent payments due monthly on the same day of each subsequent month until paid In full (b) Intenm Rent IS due and payable In full on the date speCified In Lessor's Involce(s) therefor and shall be computed by diViding one payment of Base Term Rent by thirty (30) and multiplYing the result by the number of days from and including the Commencement Date to and including the day preceding the Base Term Commencement Date (c) On or before the Commencement Date, Lessee shall pay Lessor an amount equal to $2194561 ("Advance Payment") The Advance Payment shall be applied to Lessee's first Base Term Rent Payment, With any balance to be applied to the subsequent Base Term Rent payments In Inverse order of their accrual 4 LEASE END OPTIONS ProVided no Event of Default shall have occurred and remain uncured, Lessee may upon the expiration of the Base Lease Term exercise anyone of the following options With respect to not less than all Items of EqUipment and Licensed Matenals leased hereunder, (I) return the System to Lessor, (II) extend the Lease Term at the then fair rental value ("Fair Rental Value") for an extension term the length of which shall be determined by agreement between Lessee and Lessor or (III) purchase the System for cash at the System's then fair market value, plus any and all applicable taxes ("Fair Market Value") Lessee agrees to prOVide Lessor With wntten notice of Lessee's deCISion not less than 90 days pnor to the expiration of the Base Lease Term If Lessee falls to give Lessor 90 days pnor wntten notice, the Lease Term shall automatically be extended Without notice to Lessee upon the same terms and conditions for an additional 90 days and may be terminated thereafter upon 90 days pnor wntten notice to Lessor Upon receipt of Lessee's notice of termination and Page 1 of 3 2-21-06 pnor to the return of the System, Lessor shall be entitled to expose the System for resale or lease at the Lessee's premises dunng reasonable business hours (so long as such exposure does not unreasonably Interfere with Lessee's business operations) If by proper notice Lessee elects to purchase the System and upon receipt by Lessor of the Fair Market Value and all other sums due hereunder, Lessor shall convey all of Lessor's nght, title and Interest in and to the EqUipment to Lessee free of liens and encumbrances created by Lessor, but otherwise on an AS-IS, WHERE-IS baSIS and Without representation or warranty and permit Lessee to continue to use the Licensed Matenals In accordance With the applicable Llcense(s) Fair Market Value and Fair Rental Value shall mean an amount which would obtain In an arm's-length transaction between an Informed and willing buyer/lessee (other than a dealer) and an Informed and willing seller/lessor under no compulsion to sell or lease (assuming for this purpose that the System shall have been maintained In accordance With this Lease) and will be determined by agreement between Lessor and Lessee 5 INDEX RATE The Lease Payments set forth In Section 3 hereof are based upon a two (2) year Swap rate of 5 17000% ("Index Rate") Lessor reserves the nght to adjust the Lease Payments to reflect changes In excess of five (5) baSIS pOints In the Index Rate as reported In The Wall Street Journal on the Commencement Date (or next bUSiness day If the Commencement Date IS not a bUSiness day) The amount of any such adjustment shall be determined by increasing the ImpliCit rate of this Schedule by one (1) baSIS pOint for every baSIS pOint Increase In the Index Rate Lessor Will provide Lessee With a wntten notice of any adjustment In the Lease Payments 6 ADDITIONAL PROVISIONS (None) Lease # 2110 LEAF FUNDING, INC. LESSEE City of Port Angeles By !!i~ ~. 7J?~ ~~~Na~- _$~_~ Date 2,Zb Z C> By Print Name Title Date Page 2 of 3 2-21-06 "."" U LEAF Financial Corporation ATTACHMENT A TO MASTER LEASE SCHEDULE NO.1 ISSUED PURSUANT TO MASTER LEASE AGREEMENT DATED January 2, 2007 BY AND BETWEEN City of Port Angeles ("LESSEE") AND LEAF FUNDING, INC. ("LESSOR") SYSTEM DESCRIPTION: 40 GATEWAY E-4500D DESKTOPS W/19" LCD MONITORS (QUOTE #337744-4) LESSEE City of Port Angeles By ~ ~~ /rZ~ Pnnt Name ~ e. ~ctPn Title (!c'~ 1fAAN~rtZ- Date (/o-Z..-/t!)7 I / Page 3 of 3 Title Date LEAF FUNDING, I By Pnnt Name ~ 2-21-06 LEAF Financial Corporation DELIVERY AND ACCEPTANCE CERTIFICA TE LESSEE INFORMATION Full Legal Name City of Port Angeles Billing Address PO BOX 1150 City PORT ANGELES County (!1J1J Of)fJJr\ State WASHINGTON Date of System Delivery DBA Name (If Any) Phone 360-417-4722 Zip Code 98362 On behalf of Lessee, I hereby certify that all of the equipment, software and other Items (collectively, "System") referred to In Master Lease Schedule No 1 ("Lease") Issued pursuant to that certain Master Lease Agreement, dated as of January 2, 2007 by and between Lessee and LEAF Funding, Inc ("Lessor") has been delivered to and been received by Lessee at the locatlon(s) set forth In the Lease, that all installation or other work necessary pnor to the use thereof has been examined by the Lessee and IS In good operating order and condition and IS In all respects satisfactory to Lessee, and that the EqUipment IS accepted by the Lessee for all purposes under the Lease Lessee represents and warrants that the Date of System Delivery and the Billing Address set forth above and the System Location set forth In the Lease are correct By ItS execution and delivery of this Acceptance Certificate, Lessee hereby reaffirms all of the representatIons, warranties and covenants contained In the Lease as of the date hereof, and further represents and warrants to Lessor that no Event of Default, and no event or condition which with notice or the passage of time or both would constitute an Event of Default, has occurred and IS continuing as of the date hereof Lessee further certifies to Lessor that Lessee has selected the System and has received and approved the purchase order, purchase agreement or supply contract under which the System Will be acqUIred for all purposes of the Lease ACCORDINGLY, I AUTHORIZE LESSOR TO PURCHASE THE SYSTEM DO NOT SIGN THIS DELIVERY AND ACCEPTANCE CERTIFICATE UNTIL YOU HAVE RECEIVED THE SYSTEM LESSEE SIGNATURE For Lessor Use Only Name of person venfylng Delivery & Acceptance of EquIpment: L ~y~ G fA~ By ~ Z- 7Yl;~~n ,~ M~ E, MAOSrEN Signature of Employee who made telephone venficatlon' Pnnt Name JiU.-,.v,A-6E~ /1A( Title Date of Telephone Venflcatlon J-;/)- r /0'7- Date THE ABOVE SIGNATORY AFFIRMS THAT HE/SHE IS A DULY AUTHORIZED CORPORATE OFFICER OR OFFICIAL, PARTNER OR PROPRIETOR OF THE ABOVE NAMED LESSEE @ LEAF Financial Corporation 2003, all nghts reserved Page 1 of 1 5-19-03 SECRETARY'S CERTIFICATE C!..., T 'I C!..LE R. K. The undersigned (Assistfil'it) Seeretary of the Company stated below, 6E~~Y J. {)P"iDW hereby certifies to LEAF Funding, Inc.,("LEAF") the following: (Print Name), ~ IT" ~LE RK... I am the duly elected EAssistflflt) ~eer@tary of (! 'T' V Dr: F8R."" A.N~EA ~J~ , (the "Company"). In that capacity I am familiar with the Company's books and records. The following individuals named below hold the positions set forth next to their names. Additionally, said individuals have corporate authority to execute contracts and equipment lease agreements on behalf of the Company. I further certify that I am familiar with the signatures of said individuals and that the signatures set forth adjacent to names are the true and correct signatures of said individuals. NAME tr(~( ~ fi. M..4o~ OFFICE 6(7 MAN~EI2...- SIGNATURE 711~t1- CW(~' IN WITNESS WHEREOF, th~Signed officer has executed this Certificate and affixed the seal of the Company this . daYOf~, ~D()'7 . BY. [affix Corporate Seal] ~;~E~^-- TITLE: ( '. .~ Gateway. CUSTOM INTEGRATED SOLUTIONS (CIS) SOFTWARE INSTAllATION AGREEMENT This Agreement IS made this day of , 200 ("Effective Date") by and between Gateway Companies, Inc, ("Gateway") and ("Customer"). Under the following terms and conditions, Gateway Will receive (or furnish), replicate and Install ("Software") on Gateway computer products ("Products") purchased by Customer 1. Title Title or license to copynghts and patents in the Software (and the source and object code assOCiated with the Software) are and shall remain the property of Customer or Customer's licensors All copies of the Software made by or for Gateway, as well as any and all Software developed by Gateway for Customer's benefit, shall remain the property of Customer Gateway shall Install the Software only on Customer deSignated Products. 2 License Grant In order to perform thiS serVice, Customer hereby grants to Gateway and ItS affiliates a nonexclusive, nontransferable license and right to Internally manufacture, use, and reproduce copies of the Software as contemplated herein If necessary to fulfill Customer's instructions, such grant shall also Include the nght to modify, create and reproduce computer denvatlve works, which works shall belong to the licensor of the Software 3 Representations & Warranties Customer represents and warrants that (1) It has full power to enter into thiS Agreement, (2) it has all nghts, title, and Interest In the Software and the nght to copy or have copies made for ItS own use, and such rights can be conveyed to Gateway Without restnctlon for the purposes contemplated herein, (3) modifications which the Customer requests Gateway to make to the Software do not Infnnge upon or mlsappropnate any copynght, patent, trade secret, or other propnetary nghts of any third party, (4) the media upon which the Software IS proVided to Gateway by Customer IS free from all defects and VIruses ,and (5) Installation of the Software shall not by Itself result In any performance problems or degradation of the Gateway Products 4 Export Control Compliance. Customer shall comply With any applicable export control laws and regulations as they apply to the Software and/or the export of Gateway Products onto which the Software has been installed as contemplated by thiS Agreement, and shall obtain any permits and licenses reqUired for the lawful export, operation and use of such Products or components thereof Customer shall Indemnify and defend Gateway against any breach of ItS obligations under thiS paragraph and shall pay all resulting costs, damages and attorney's fees related thereto 5. Indemnification' To the extent permitted by law, the Customer agrees to Indemnify, hold harmless and defend Gateway, ItS officers, directors, contractors and employees from and against any assertions, claims, causes of action, liabilities, costs, losses, and damages, Including direct, Indirect, or consequential damages arising out of or relating to any matter contemplated by thiS Agreement Including' (1) alleged Infnngement or Violation of any trademark, copynght, trade secret, nght of publiCity or pnvacy, patent or other propnetary nght With respect to the Software, (2) any possession or use of confidential or propnetary information or trade secrets Customer has obtained from sources other than Gateway, (3) any Customer failure to comply With federal, state or local law (including notice of any ITAR encryption requirements), and (4) the breach of any representation, covenant or warranty stated herein 6 General ProvIsions All matters anslng as between Gateway and Customer With respect to the subject matter of this Agreement which are not specifically addressed herein shall be governed by the Gateway Standard Terms and Conditions of Sale accompanYing the Products, which are Incorporated herein by this reference IN WITNESS WHEREOF Gateway and Customer have executed this Agreement as of the Effective Date by signature of their authonzed representatives. Gateway Companies, Inc BY TITLE DATE ~~~~. ~~ ~2006, Gateway Companies, Inc., all rights reserved Gateway Confidential, rev 10.1206 . . ~-- .........--_._---~,._- '. -' ~.."."-,.... ~ - - FORT ,ANGELES -Cl1Y:OF WAS H I N G TON, U. S. A. HUMAN RESOURCES OFFICE Date: December 21,2006 To: To Whom It May Concern From: Bob Coons, Human Resources Manager ~~ RE: LiabilIty and Property Insurance for the City of Port Angeles Attached are the insurance coverage documents for Liability and Property coverage for the City of Port Angeles. These are for 2006 and we have not receIved our 2007 coverage documents as of this date. The coverage limits will be the same. The City calTies a $5,000 deductible for property coverage and $100,000 for liability insurance. We purchase our insurance through a pool of public agencIes, mostly cities. The agency is Washington Cities Insurance Authority. If you need addItional information please contact me at 360-417-4511. Thank you. Attachments: Coverage documents for Liability and Property Coverage. -~~, WCIA Coveraoe Document #CT-2005 Paoe 2 WASHINGTON CITIES INSURANCE AUTHORITY LIMITS/ULTIMATE NET LOSS: SELF-INSURED LAYER LlMIT. Self-insured Coverage Document CT-2005 January 1,2005, to January 1,2006 12:01 am Pacific Standard Time $3,000,000 PER OCCURRENCE REINSURED EXCESS LAYER LlMIT' $11,000,000 PER OCCURRENCE TOTAL LlMIT: $14,000,000 PER OCCURRENCE, subject to aggregates and sub-limits below and In Section I.D, (Coverage LImits) In the WCIA Jomt Protection Program. AGGREGATE L1MITS/SUB-LlMITS: Above self-insured layer limits $30,000,000 general aggregate per Member, $20,000,000 annual aggregate Errors or OmiSSions Liability Coverage per Member, and a $5,000,000 Employment PractIce Liability annual aggregate per member. $3,000,000 per occurrence limit and $3,000,000 annual aggregate per Member applYing to Terronsm. L DESCRIPTION OF COVERAGE General Liabihty, Automobile Liability, Stop-Gap Coverage, Errors or OmiSSions Liability and Employee Benefits Liability. LIMITS OF LIABILITY rOR ALL COVERAGE. The limits/Ultimate Net Loss stated herein and the rules below set the maximum the Authority will pay regardless of the number of. a. members; b. claims made or laWSUits brought; or c. persons or organizations making claims or bnnging lawsuits 'TERRITORY: This coverage applies to General Liability, Automobile liabilIty, Stop-Gap Coverage, Errors or OmiSSions Liability and Employee Beneiit Liability occurnng anywhere in the United States of America, its teniwnes and possessions or Canada MEMBERS COVERED BY THIS AGREEMENT: Aberdeen Anacortes A Regional Coalition for Housing Arlington Auburn Balnbndge Island Battle Ground Benton County Emergency Services Bonney Lake Bothell Burien Camas Centralia Chehlills Cheney or' Kenmore Kent Kirkland Lacey La Conner Lake Forest Park Lake Stevens Leavenworth Long Beach Longvlew LOTI Alliance Mabton Maple Valley Marysville Marysville Fire District Pullman-Moscow Regional Airport PuyaJlup Renton Rlchland Sammamlsh Shelton Shoreline Skagit 911 Snohomish Snohomish Co. Dept. Emerg. Mgt. Snohomish Co. Emergency Radio Sys. SNOCOM/Medic 7 SNOPAC Snoqualmie Soap Lake WCIA Coveraqe Document #CT-2005 Chelan Clark Regional Emerg Serv Ag. (CRESA) Clarkston Cle Elum Clyde HIli Coupevllle Covington Cowlitz Sewer Operating Board Des MOines Eastslde pubilc Safety Communications eClty -Gov Alilance Edgewood Edmonds Elma Emergency Services Coordinating Agency Enumclaw Fife Goldendale Grandview Grays Harbor 911 Communications Hoquiam Issaquah Kelso Paae 3 McCleary Moses Lake Pullman Medical Lake Medina Mercer Island Mill Creek Milton Monroe Monroe Fire Dlstnct Montesano Mountlake T'errace Mount Vernon MukIlteo Newcastle Normandy Park North Bonneville Ocean Shores Olympia Pasco PEN COM Port Angeles Port Townsend Spolcane Valley Stanwood Steilacoom Spokane Valley Sumner Thurston RegIOnal Planning Council T oppenish Tukwila Tumwater Union Gap UniverSity Place Valley Communications Walla Walla WA Cities Insurance Authority Washougal ~ Water Operating Board Westport Woodlnville Woodway Yakima Valley Conference of Govern Yarrow Point Zillah ThiS document IS not an msurance policy. The Washmgton CIties Insurance Authority (Authority) IS not an Insurance company. This document IS an agreement by the Authonty and its members to pay all covered losses subject to the limits and other terms and conditIOns of this Agreement and any addenda attached, In consideration of the assessments paid by the members, thiS Agreement provIdes the following coverages: I. COVERAGE AGREEMENTS 1. Coverage -A. GENERAL & AUTOMOB1LE LIABILITY COVERAGE In consideration of the assessment herein provided, the Authority hereby agrees, subject to the Ilmitatlons, terms and conditions hereinafter mentioned, to pay on behalf of the member all sums which the member shall be obligated to pay by reason of liability: a Imposed upon the member by law, Dr b. assumed under contract Dr agreement by the member and/or any officer, director, offiCial, or employee of the member, while actmg in his or her capacity as such: for damages, direct or consequential and expenses, all as more fully defined by the term "ultimate net loss" on account of: i. personal injury, it. property damage, IIi. advertising liability, caused by or arising out of an occurrence during the coverage penod The coverage for the liability assumed under contract In l.A.i.b. above shall be limited to the terms, conditions, IJmitations and exclusions in the Coverage Document. "Damages" as used in this section and this Agreement, do not include pLinitive or exemplary damages or fines or penalties awarded against the member. E\I-IDEN,CE {iF PR;OPERIT"V--'INSURANC-E, CERTIFICATE NUMBER. , _ - _ _ -- . n SEA-000825137-07 THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER OTHER THAN THOSE PROVIDED IN THE POLICY THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES LISTED HEREIN I I PRODUCER Marsh USA Inc The Financial Center 1215 Fourth Avenue SUite 2300 Seattle, WA 98161.1095 Attn Cheryl Bermudez 206-613.2468 823057 _SUB_PROP-05-06 'MARSH COMPANY LEXINGTON INS CO EFFECTIVE DATE (MMIDDIYY) 12/01/05 POLICY NUMBER 0431948 LOAN NUMBER INSURED MEMBER CITY OF PORT ANGELES WASHINGTON CITIES INSURANCE AUTHORITY ATTN ERIC LARSON PO BOX 88030 TUKWILA, WA 98138 CONT. UNTIL TERMINATED IF CHECKED THIS REPLACES PRIOR EVIDENCE DATED - ~ -' -- ,--- 'J ::.:-: '. _.:',.-.-. -;-:.- , ': - -, - , " "PROPERT.Y !NFORMATlqN -LOCATiON J DESCRIPTION CITY OF PORT ANGELES IS INCLUDED AS AN ADDITIONAL INSURED AS RESPECTS THEIR INTEREST AND AS REOUIRED BY WRITTEN CONTRACT AS PER SCHEDULE LOCATIONS WITH THE INSURANCE COMPANY AND MARSH USA INC -~--- .:." , .CpVERAG E-JN~ ORMATIGN This.certifi~te:superse~~=:; .iln~'"~Jila c:s,-any,prev!ously:i~ued 'c,ertificate.tor::the:IJ~~cn)e-riod not~d.below;:,.",. '>. :-,0-,;-: . ,';: -13:c : _" c~-_...::;'.:!.::.;;:::'~ ___ ._:' _ ~..., '._ _ =_ ,", ~...." _ __L __"-" _ ...~,............_ _____._ _ _ ___~_ ___ _ '>- - __ ~,-- >- -, - -,-=<-- --- -.... - ~~ ~ .- - -- -- --- --'- - --.... - - - - ..:--,,_:./':'.., :;.,o,,'_n.-.l - -, J, ""-~"- ii' - THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED HEREIN HAVE BEEN ISSUED TO THE INSURED NAMED HEREIN FOR THE POLICY PERJOD'lNO'iCATED NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH 'RESPECT TO WHICH THE CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES LISTED HEREIN IS SUBJECT TO ALL THE TERMS, CONDITIONS AND EXCLUSIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS COVERAGES I PERILS J FORMS AMOUNT OF INSURANCE ($) . DEDUCTIBLE "ALL RISK" OF PHYSICAL LOSS OR DAMAGE PER OCCURRENCE, SUBJECT TO POLICY TERMS, CONDITIONS, LIMITATIONS, AGGREGATES AND EXCLUSIONS 300,000,000 500,000 PER OCC ':\THOUAKE, PER OCCURRENCE AND ANNUAL AGGREGATE n.oOD, PER OCCURRENCE AND ANNUAL AGGREGATE, EXCEPT FLOOD IN ZONES AN, PER OCCURRENCE AND ANNUAL AGGREGATE UNSCHEDULED TUNNELS,BRIDGES,DAMS,CATWALKS, ROADWAYS, HIGHWAYS, STREETS, SIDEWALKS, CULVERTS, STREET LIGHTS AND TRAFFIC SIGNALS 'THE AOP DEDUCTIBLE IS $500,000 PER OCCURRENCE, WITH A $1,000,000 ANNUAL AGGREGATE DEDUCTIBLE AND A $10,000 MAINTENANCE DEDUCTIBLE' ;R,EM~RKS (Includir19-SpeclaIC~ndlbDns)_::"'~;'-,,,;:':~: ::-'.: "'<" ~,---~'>-,-::~~--_.,; ,- ':--:" ---' ." ,,,'.-'-. 'PLj~ASE'REF'ER-Tb'THE POLICY FbFfsp{tfFlcTERM~:rtONDIi:ToNS);':Nb ExcLTTsToNS'- --.----' VEHICLES ARE SUBJECT TO A $100,000,000 LIMIT AND A $50,000 DEDUCTIBLE FOR OFF-PREMISES COMPREHENSIVE DAMAGE SPECIALL Y TRAINED ANIMALS ARE SUBJECT TO A $1 ,000,000 LIMIT ($50,000 PER ANIMAL) AND A $25,000 DEDUCTIBLE 100,000,000 100,000,000 50,000,000 2%/$100,000 Mm 250,000 3%1500,000 Mm 250,000 -'- --- ,"" - - -'" -= . --~ .. LEXINGTON INSURANCE COMPANY LIBERTY MUTUAL FIRE INSURANCE COMPANY CONTINENTAL CASUALTY COMPANY 0431948 M02-L9L-436190-o15 RMP271 069369 PRIMARY $100M $50M xs $100M $15oM xs $150M __ .1 ,~c'~ .... __ >"".....:, "C'H"--'-":_>",,::.; ~_ ~,~~'.. ~"~;:'...,..,~: !'::.~~,",,~::..'::;;-":;^' ~, ~.~ ", 1 -, ~ ,- ~--l -.~, {'I.: r- . ' <' _ ::", ~". .:: U:,:. :2~.._':n ...~~ ' 'CANCELLATION - -' u~,...,";;."'~ -~-:_~~ - -,- , ~ '. SHOULD ANY OF THE POLICIES LISTED HEREIN BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, THE INSURER AFFORDING COVERAGE WILL ENDEAVOR TO MAIL~ DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED HEREIN, BUT FAILURE TO MAIL SUCH NOTICE SHALL IMPOSE NO OBLIGATION OR LIABILITY OF ANY KIND UPON THE INSURER AFFORDING COVERAGE, ITS AGENTS OR REPRESENTATIVES, OR THE ISSUER OF THIS CERTIFICATE. CERTIFICATE HOLDER '" -- - ~ "-- - -- - ------ - - -:;."_1, r ~~ . :,,- " ~ ---' -' - , ". ,- --..!... " , , _ ~ _" -.:':'l~'~~ -=.: -~:'~", .' '. - .;: - :_"',,,,=:- J- NATURE OF INTEREST NAME AND ADDRESS MEMBER CITY OF PORT ANGELES, WASHINGTON CITIES INSURANCE AUTHORITY ATTN: ERIC LARSON PO BOX 88030 TUKWILA, WA 98138 D MORTGAGEE ~ ADDITIONAL INSURED D LOSS PAYEE D (OTHER) MARSH USA INC. , _ _'__'~___""''''~Y __,Q,o!legn s.J-lL!ffm~n~: ~ -~}~ ~r~~:~ .:";~~~~':; :~,~~~~~:i;;~li~(~::~( ,~~ '-',~r7~~~f~i;;{g~~~':~:;" ~. ~q~~D ~~ ~'F7: ~127~~~~f~:,~ -.,. , !- t~=- ~ " WASHINGTON CITIES INSURANCE AUTHORITY PROPERTY PROGRAM I INSURANCE SUMMARY NAMED INSURED PERIOD: PERILS INSURED: PROPERTY INSURED: CARRIERS AND LINE: POLICY FORM: LIMITS: $300,000,000 $150,000,000 $150,000,000 $100,000,000 $100,000,000 $50,000,000 $100,000,000 $100,000,000 $25,000,000 $25,000,000 $25,000,000 $25,000,000 $25,000,000 $25,000,000 $10,000,000 $10,000,000 $10,000,000 $10,000,000 $10,000,000 $10,000,000 Washington Cities Insurance Authority and its affiliated, Subsidiary, and associated companies and/or corporations and the Insured's Interest in partnerships and Jomt ventures as now exist or may hereafter be constituted or acquired and any party In interest which the Insured is responsible to insure. December 1, 2005 to December 1, 2006 "Ail_Risk" of Direct Physical Loss or Damage mcluding Certified (TRIA) and Non-Certified Acts of Terrorism, Earthquake and Flood and as may be more fully defined in the policy form. Blanket Real and Personal Property, Business Interruption, Demolition Increased Cost of Construction, Debris Removal, Course of Construction, Sue & Labor Primary $100,000,000: Lexington Insurance Company Policy #0431855 I AM Best Rating: A++ rxV) $50.000,000 xs $100,000.000: Liberty Mutual Fire Insurance Company Polley #MQ2-L9L-436190-015 I AM Best Rating: A ()CV) $150.000 000 xs $150.000.000: Continental Casualty Company Policy# RMP271 069369 I AM Best Rating: P. (XV) Pnmarv $100.000 000: WCIA 05-06 Manuscript Form Excess Lavers: Fallowing Form following Primary Per Occurrence: All Perils Terrorism (Certified (TRIA) and Non-Certified) Accounts Receivable Earthquake (Annual Aggregate) Flood (Annual Aggregate) Flood for Zones AN (Annual Aggregate) On and Off Premises Vehicle Comp;ehensive Damage On Premises Vehicle Comprehensive and Collision Damage Extra Expense Automatic Acquisition/Newly Acquired Locations (120 days reporting) Errors and Omissions Course of Construction Demolition and Increased Cost of Construction Off Premises Service Interruption Business Interruption Miscellaneous Unnamed Locations Transit Newly Acquired Vehicles (per acquisition) Contingent Business Interruption / Tax Interruption Expediting Expenses This summary is for your reference only. Please refer to the policy for specific terms, con-cJjflDns, /Jmits and exclusIOns. 1 of 2 MARSH WASHINGTON C!TIES INSURANCE AUTHORITY PROPERTY PROGRAM I INSURANCE SUMMARY DEDUCTIBLES: - DEFINITIONS: KEY CONDITIONS: VALUATION: TERRITORY: $10,000,000 $10,000,000 $5,000,000 $2,500,000 $2,500,000 $1,000,000 $1,000,000 $500,000 $500,000 $500,000 $250,000 $250,000 Excluded $500,000 $1,000,000 $10,000 2% $250,000 3% $50,000 $25,000 $50,000 24 hours Clvil Authority IngressfEgr~ss Scheduled Landscapmg, tees, sand traps, greens and athletic fields Unscheduled Fine Arts Watercraft under 28 feet Unscheduled Landscaping, tees, sand traps, greens and athletic fields Animals (not to exceed $50,000 per ammal) Jewelry, Furs, PrecIous Metals and Stones (Separately) Claims PreparatIOn f Professional Fees Personal Property OutSide of USA (per occurrence) Accidental Contamination f Pollution Cleanup (Annual Aggregate) Unscheduled tunnels, bridges dams, catwalks, roadways, highways, streets, sidewalks, culverts, street lights and traffic signals Money and Securities All-Risk Basic Deductible (AOP) Annual Aggregate Pool Deductible Maintenance Deductible (After Aggregate Reached) of values for Earthquake, subject to a $100,000 minimum per occurrence Flood, except: of values for Flood in Zones AN, subject to a $500,000 minimum per occurrence Vehicles (Off-Premises) Specially Trained Animals Fme Arts Service Interruption Waiting Period Description of Aqqreaate Pool Deductible There is a $1,000,000 aggregate deductible and a $500,000 AOP per occurrence deductible (other specified deductibles may also apply). Every time there is a loss over $1 0,000, the deductible IS eroded by the amount ofthe loss. When the aggregate is eroded in its entirety, a $10,000 mamtenance deductible is applied to each successive loss. Losses that Do Not Erode the Aqareaate Vehicle Losses, Contractors Equipment, Watercraft, Scheduled Fine Arts, Animal Losses, Tees and Greens, Earthquake, Flood and Tax Interruption. War and Terrorism Endorsement; Mold and Fungus Exclusion; Pollution and Contamination Exclusion Property Damaqe: Replacement Cost Time Element: Actual Loss Sustained Mobile Equipment: Actual Cash Value United States of America, its possessions and territories and Canada This summary is for your reference only. Please refer to the poilcy for specific terms, condItions, limits and exclusions. 2of2 MARSH FI-~ or R-1:Plv' NrG.EtE1S 1 --- -j~~~~ 7-- - = = WAS H I N G TON, U. S. A. CITY ATTORNEY OPINION OF LEGAL COUNSEL TO: LEAF Funding, Inc. 1818 Market Street, 9th Floor Philadelphia, P A 19103 .Re: Schedule No.1 issued pursuant to that certain State. and Local Government Master Lease "purchase Agreement, dated as of January 2, 2007 (together, the "Lease"), each by and between City of Port Angeles ("Lessee") and LEAF Funding, Inc. ("Lessor") I I I ' , I Ladies and Gentlemen: I am ~egal Coun.sel for City of Port Angeles,("Lessee"), and I am familiar with the above- : referenced Lease by'and by tween LEAF Funding, Inc, as Lessor, and Lessee. Capitalized terms : that are not defined herein shalL have the meanings given these terms in the Lease. . Based upon my , ' : examination of the Lease, and such other documents, records and papers as I deem to be relevant , and necessary as the basis for my opinion set forth below, it is my opinion that: 1. Lessee is a fully constituted political subdivision or agency or department of the I State of Washington. . 2. Th.e Lessee is a State or a political subdivision the(eof, as those terms ~e used in Section 103 of the Code, and is authorized by the applicable Constitution and laws to enter into the Lease and to carry out its obligations thereunder. No further approval, consent or withholding i of objections is required from any Federal, state or local governmental authority with respect to , the entering into or the performance by the Lessee of the Lease and the transaction( s) contemplated , hereby. . 3. Excluding the insurance provisions set forth in Section 10 'of the Lease, the ,; indemnification provisions set forth in Section 11 of the Lease, ~d the representations set forth . : in Section 16(k) ofthe Lease; the Lease cQnstitutes a legal, valid and -binding obligation of Lessee ! enforceable in ac'cordall~e with its terms. The Lease does not violate or create a default under any , i instrument or agreement binding on Lessee. The opinion set forth in this Paragraph 3 is qualified I to the extent that the enforcement of Lessor's rights and remedies under the Lease may be limited 'i by laws relating to bankruptcy, reorganization, insolvency, moratorium or other similar laws of general application affecting the rights of creditors, by the applicatiolJ. of equitable principles and the exercise of judicial discretion, and by limitations on legal' remedies against muniCipal corporations in the State of Washington. 321 EAST FIFTH STREET · POBOX 1 150 · PORT ANGE'LES, WA 98362,-0217 PHON E. 360-417-453'0 · FAX 369-417-4529. TTY 360-417-4645 E-MAIL attorney@cltyofpa us 4. There' are-no pending or threatened actions or proceedings before-any court or administr~tive agency that could have a material adverse ~ffect on tp.e Lease. 5. The entering into and performance of the Lease is not contrary to and does not violate any judgment, order, law or regulation or constitute a default by Lessee under aily other agreement or instrument. ' . 6. The System is persona.! property and will not bec~me a fixture. 7. With respect to.the Lease, Lessee has fully complied with all applicable law governing open meetings, public bidding and appropriations required in connection with the Lease and the acquisition of the System. 8.. The Lessee shall be the only entity to own, operate and use the System during the 'Term of the Lease. Very truly yours, ~~ William E. Bloor City Attorney January 11, 2007 G:\LEGAL\LETT~RS.2007\OpmionLetterl-11-67 .wpd