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HomeMy WebLinkAboutResolutions 5483 - Financing of a Master Lease Purchase Agreement for Elgin SweeperVersion February 2023 RESOLUTION 5483 A RESOLUTION RELATING TO THE FINANCING OF A MASTER LEASE PURCHASE AGREEMENT DATED AS OF 02/03/2023, BETWEEN LEASE SERVICING CENTER, INC. DBA NCL GOVERNMENT CAPITAL (LESSOR) AND THE CITY OF BOZEMAN (LESSEE) AND SCHEDULE NO. 001 THERETO DATED AS OF FEBRUARY 3, 2023. WHEREAS, The Street Division uses Sweepers to Clean Streets and Bike Lanes for all Modes of Travel. Sweeping Debris from the Road Keeps the Particles from Becoming Airborne and out of the Stormwater System. NOW, THEREFORE, BE IT RESOLVED by the City Commission (The “Commission”) of the City of Bozeman, Montana (the “City”), as follows: Section 1 Determination of Need. The Governing Body of Lessee has determined that a true and very real need exists for the acquisition of the Equipment described on Exhibit A of Schedule No. 001 to the Master Lease Purchase Agreement dated as of 2/3/2023, between City of Bozeman (Lessee) and Lease Servicing Center, Inc. dba NCL Government Capital (Lessor). Section 2 Approval and Authorization. The Governing Body of Lessee has determined that the Agreement and Schedule, substantially in the form presented to this meeting, are in the best interests of the Lessee for the acquisition of such Equipment, and the Governing Body hereby approves the entering into of the Agreement and Schedule by the Lessee and hereby designates and authorizes the following person(s) to execute and deliver the Agreement and Schedule on Lessee’s behalf with such changes thereto as such person(s) deem(s) appropriate, and any related documents, including any Escrow Agreement, necessary to the consummation of the transaction contemplated by the Agreement and Schedule. The City of Bozeman is authorized to enter into the lease/purchase financing with Lease Servicing Center, Inc. dba NCL Government Capital to finance their 2022 Elgin Broom Bear from Joe Johnson Equipment LLC in the amount of $277,720.00 with 5 annual payments of $63,370.03. DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Version February 2023 PASSED, ADOPTED, AND APPROVED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the _____ day of ___________________, 20____. ___________________________________ CYNTHIA L. ANDRUS Mayor ATTEST: ___________________________________ MIKE MAAS City Clerk APPROVED AS TO FORM: ___________________________________ GREG SULLIVAN City Attorney DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 March21st 23 City of Bozeman 121 N Rouse Ave Bozeman, MT 59715 Enclosed you will find finance documentation for your recent equipment purchase. Please review, sign, and date all the enclosed documents. Be sure to completely list your insurance information. Do not alter documents in any way. Please return the following items to my attention:  Master Lease Purchase Agreement  Exhibit A – Description of Equipment of Lease Agreement  Exhibit B – Schedule of Payments  Exhibit E – Lessee Resolution  Exhibit F – Bank Qualified Certificate  Exhibit G – Agreement to Provide Insurance  Exhibit H – Lessee Certificate  Notice of Assignment and Letter of Direction  Internal Escrow Letter  Lease Payment Instructions  Exhibit C-1 – Payment Request and Partial Acceptance Certificate  Exhibit C-2 – Final Acceptance  8038-G Copy of Tax Exempt Certificate (please provide if applicable) Include in the return documentation a check in the amount of $500.00 made payable to Lease Servicing Center, Inc. dba NCL Government Capital. This is the one-time documentation & processing fee. Please call me at 320-763-7600 with any questions you may have and thank you for your business. We hope to continue to work with you for many years to come. Please let us know if we can be of any assistance in the future! Sincerely, Tim Goetsch Enclosures DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 1 MASTER LEASE PURCHASE AGREEMENT Lessee Lessor City of Bozeman Lease Servicing Center, Inc. dba NCL Government Capital 121 N Rouse Ave 510 22nd Ave E., Ste 501 Bozeman, MT 59715 Alexandria, MN 56308 Dated as of February 3, 2023 This Master Lease Purchase Agreement dated as of the date listed above is between Lessor and Lessee listed directly above. Lessor desires from time to time to lease the Equipment described in Equipment Schedules (each a “Schedule”) to be attached hereto to Lessee and Lessee desires to lease such Equipment from Lessor subject to the terms and conditions of this Agreement, which are set forth below, and the applicable Schedule. I. Definitions: Section 1.01. Definitions. The following terms will have the meanings indicated below unless the context clearly requires otherwise: “Agreement’ means this Master Lease Purchase Agreement. “Budget Year” means the Lessee’s fiscal year. “Commencement Date” is the date when Lessee’s obligation to pay rent begins. “Equipment” means the items of Equipment listed on Exhibit “A” to each Schedule and all replacements, restorations, modifications and improvements. “Lease” means this Agreement and an individual Schedule hereto, which shall collectively constitute the terms and conditions applicable to the lease of the Equipment subject thereto. “Lessee” means the entity listed above as Lessee and which is leasing the Equipment from Lessor under the provisions of this Agreement and a Schedule. “Lessor” means the entity originally listed above as Lessor or any of its assignees. “Lease Term” means the Original Term and all Renewal Terms applicable to a Lease. “Original Term” means the period from the Commencement Date until the end of the Budget Year of Lessee. “Renewal Term” means the annual term which begins at the end of the Original Term and which is simultaneous with Lessee’s Budget Year. “Rental Payments” means the payments Lessee is required to make under this Agreement as set forth on Exhibit “B” to each Schedule made subject thereto. “Schedule” means a schedule substantially in the form attached hereto and all exhibits thereto pursuant to which Lessor and Lessee agree to the lease of the Equipment described therein and which together with the terms of the Agreement applicable thereto constitutes an individual Lease. “State” means the state in which Lessee is located. II. Lessee Warranties Section 2.01. With respect to each Lease, Lessee represents, warrants and covenants as follows for the benefit of Lessor or its assignees: (a) Lessee is the State or a political subdivision of the State within the meaning of Section 103 of the Internal Revenue Code of 1986, as amended (the "Code") or a constituted authority authorized to issue obligations on behalf of the State or political subdivision of the State within the meaning of the treasury regulations promulgated under the Code. (b) Lessee is authorized under the Constitution and laws of the State to enter into this Agreement and each Schedule, and has used such authority to properly execute and deliver this Agreement and each Schedule. Lessee has followed all proper procedures of its governing body in executing this Agreement and each Schedule. The Officer of Lessee executing this Agreement and each Schedule has the authority to execute and deliver this Agreement and such Schedule. This Agreement and each Schedule constitute a legal, valid, binding and enforceable obligation of the Lessee in accordance with their terms. (c) Lessee has complied with all statutory laws and regulations that may be applicable to the execution of this Agreement and each Schedule. (d) Lessee shall use the Equipment only for essential, traditional government purposes. (e) Should the Lessee cease to be an issuer of tax exempt obligations or if the obligation of Lessee created under any Lease ceases to be a tax exempt obligation for any reason, then Lessee shall be required to pay additional sums to the Lessor or its assignees so as to bring the after tax yield on any Lease to the same level as the Lessor or its assignees would attain if the transaction continued to be tax-exempt. (f) Lessee has never non-appropriated funds under an agreement similar to this Agreement. (g) Lessee will submit to the Secretary of the Treasury an information reporting statement as required by the Code with respect to each Lease. (h) Upon request by Lessor, Lessee will provide Lessor with current financial statements, reports, budgets or other relevant fiscal information. (i) Lessee shall retain the Equipment free of any hazardous substances as defined in the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. 9601 et. seq. as amended and supplemented. (j) Lessee presently intends to continue each Lease for the Original Term and all Renewal Terms as set forth on Exhibit "B" to the Schedule relating thereto. The official of Lessee responsible for budget preparation will include in the budget request for each Budget Year the Rental Payments to become due in such Budget year, and will use all reasonable and lawful means available to secure the appropriation of money for such Budget Year sufficient to pay the Rental Payments coming due therein. Lessee reasonably believes that moneys can and will lawfully be appropriated and made available for this purpose. Section 2.02. Escrow Agreement. In the event both Lessor and Lessee mutually agree to utilize an escrow account, then immediately following the execution and delivery of any Schedule, Lessor and Lessee agree to execute and deliver and to cause an escrow agent to execute and deliver an escrow agreement. Such Lease shall take effect only upon execution and delivery of the escrow agreement by the parties thereto. Lessor shall deposit or cause to be deposited with the escrow agent for credit to an equipment acquisition fund the sum specified in such Schedule which shall be held, invested and disbursed in accordance with the escrow agreement. III. Acquisition of Equipment, Rental Payments and the Purchase Option Price Section 3.01. Acquisition: Lessee shall advise Lessor of its desire to lease Equipment and of the desired lease terms. Upon agreement by Lessor and Lessee as to the lease of such Equipment and such terms, Lessee shall be solely responsible for the ordering of the Equipment and the delivery and installation thereof. Lessor shall furnish to Lessee a Schedule relating to such Equipment, which shall become effective upon the execution and delivery of such Schedule, all documents contemplated hereby and thereby with respect to such Schedule, and the earlier of Lessee's written acceptance of such Equipment or the deposit into escrow of moneys to pay for such Equipment as provided in Section 2.02. Nothing herein shall obligate Lessor to lease any Equipment to Lessee until Lessor shall have concurred in writing to the lease of such Equipment. Section 3.02. Rental Payments. Lessee shall promptly pay Rental Payments under each Schedule, from any and all legally available funds, exclusively to Lessor or its assignees, in lawful money of the United States of America. The Rental Payments shall be sent to the location specified by the Lessor or its assignees. The Rental Payments shall constitute a current expense of the Lessee and shall not constitute an indebtedness of the Lessee. Lessor shall have the option to charge interest at the highest lawful rate on any Rental Payment received later than the due date. The Rental Payments will be payable without notice or demand. Section 3.03. Rental Payments Unconditional. Except as provided under Section 4.01, THE OBLIGATIONS OF LESSEE TO MAKE RENTAL PAYMENTS AND TO PERFORM AND OBSERVE THE OTHER COVENANTS CONTAINED IN THIS AGREEMENT SHALL BE ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS WITHOUT ABATEMENT, DIMINUTION, DEDUCTION, SET-OFF OR DEFENSE. Section 3.04. Purchase Option Price. With respect to each Schedule, upon 30 days written notice, Lessee shall have the option to pay, in addition to any DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Rental Payment due thereunder, the corresponding Purchase Option Price which is listed on the same line on Exhibit B to such Schedule. If Lessee chooses this option and pays the Purchase Option Price to Lessor then Lessor will transfer any and all of its rights, title and interest in the Equipment subject to such Lease to Lessee. Section 3.05. Lease Term. The Lease Term of each Lease shall be the Original Term and all Renewal Terms thereunder until all the Rental Payments due thereunder are paid as set forth in the applicable Schedule except as provided under Section 4.01 and Section 9.01 below. If, after the end of the budgeting process which occurs at the end of the Original Term or any Renewal Term, Lessee has not terminated a Lease pursuant to Section 4.01 hereof then the Lease Term for such Lease shall be extended into the next Renewal Term and the Lessee shall be obligated to make the Rental Payments that come due during such Renewal Term. Section 3.06. Disclaimer of Warranties. LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY, AND FITNESS FOR PARTICULAR PURPOSE OR ANY OTHER WARRANTY WITH RESPECT TO THE EQUIPMENT. LESSOR SHALL NOT BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE ARISING OUT OF THE INSTALLATION, OPERATION, POSSESSION, STORAGE OR USE OF THE EQUIPMENT BY LESSEE. IV. Non-Appropriation Section 4.01. Non-Appropriation. If insufficient funds are available in Lessee’s budget for the next Budget Year to make the Rental Payments for the next Renewal Term under any Lease, then Lessee shall have the option to non-appropriate the funds to pay the Rental Payments for the next Renewal Term with respect to such Lease. Lack of a sufficient appropriation shall be evidenced by the passage of an ordinance or resolution by the governing body of Lessee specifically prohibiting Lessee from performing its obligations under such Lease for a designated Budget Year and all subsequent Budget Years. If Lessee chooses this option, then all obligations of the Lessee under such Lease regarding Rental Payments for all remaining Renewal Terms shall be terminated at the end of the then current Original Term or Renewal Term without penalty or liability to the Lessee of any kind provided that if Lessee has not delivered possession of the Equipment subject to such Lease to Lessor as provided herein and conveyed to Lessor or released its interest in such Equipment by the end of the last Budget Year for which Rental Payments were paid, the termination shall nevertheless be effective but Lessee shall be responsible for the payment of damages in an amount equal to the amount of the Rental Payments thereafter coming due under Exhibit “B” to the Schedule for such Lease which are attributable to the number of days after such Budget Year during which Lessee fails to take such actions and for any other loss suffered by Lessor as a result of Lessee’s failure to take such actions as required. Lessee shall immediately notify the Lessor as soon as the decision to non-appropriate is made. If such non-appropriation occurs, then Lessee shall deliver the Equipment to Lessor or to a location designated by Lessor at Lessee’s expense. Lessee shall be liable for all damage to the Equipment other than normal wear and tear. If Lessee fails to deliver such Equipment to Lessor, then Lessor may enter the premises where such Equipment is located and take possession of the Equipment and charge Lessee for costs incurred. V. Insurance, Damage, Insufficiency of Proceeds, Lessee Negligence Section 5.01. Insurance. Lessee shall maintain both casualty insurance and liability insurance at its own expense with respect to the Equipment. Lessee shall be solely responsible for selecting the insurer(s) and for making all premium payments and ensuring that all policies are continuously kept in effect during the term of any Lease. Lessee shall provide Lessor with a Certificate of Insurance, which lists the Lessor and/or assigns as a loss payee and an additional insured on the policies with respect to the Equipment. (a) Lessee shall insure the Equipment against any loss or damage by fire and all other risks covered by the standard extended coverage endorsement then in use in the State and any other risks reasonably required by Lessor in an amount at least equal to the then applicable Purchase Option Price of the Equipment. Alternatively, Lessee may insure the Equipment under a blanket insurance policy or policies. (b) The liability insurance shall insure Lessor from liability and property damage in any form and amount satisfactory to Lessor. (c) Provided that, with Lessor's prior written consent, Lessee may self-insure against the risks described in (a) and (b) above. Lessee shall furnish Lessor evidence of such self-insurance coverage throughout each Lease Term. Lessee shall not materially modify or cancel such self-insurance coverage without first giving written notice thereof to Lessor at least 10 days in advance of such cancellation or modification. (d) All insurance policies issued or affected by this Section shall be so written or endorsed such that the Lessor and its assignees are named additional insured and loss payees and that all losses are payable to Lessee and Lessor or its assignees as their interests may appear. Each policy issued or affected by this Section shall contain a provision that the insurance company shall not cancel or materially modify the policy without first giving thirty 30 days advance notice to Lessor or its assignees. Lessee shall furnish to Lessor certificates evidencing such coverage throughout each Lease Term. Section 5.02. Damage to or Destruction of Equipment. Lessee assumes the risk of loss or damage to the Equipment. If the Equipment or any portion thereof is lost, stolen, damaged, or destroyed by fire or other casualty, Lessee will immediately report all such losses to all possible insurers and take the proper procedures to attain all insurance proceeds. At the option of Lessor, Lessee shall either (1) apply the Net Proceeds to replace, repair or restore the Equipment or (2) apply the Net Proceeds to the applicable Purchase Option Price. For purposes of this Section and Section 5.03, the term Net Proceeds shall mean the amount of insurance proceeds collected from all applicable insurance policies after deducting all expenses incurred in the collection thereof. Section 5.03. Insufficiency of Net Proceeds. If there are no Net Proceeds for whatever reason or if the Net Proceeds are insufficient to pay in full the cost of any replacement, repair, restoration, modification or improvement of the Equipment, then Lessee shall, at the option of Lessor, either complete such replacement, repair, restoration, modification or improvement and pay any costs thereof in excess of the amount of the Net Proceeds or apply the Net Proceeds to the Purchase Option Price and pay the deficiency, if any, to the Lessor. Section 5.04. Lessee Negligence. Lessee assumes all risks and liabilities, whether or not covered by insurance, for loss or damage to the Equipment and for injury to or death of any person or damage to any property whether such injury or death be with respect to agents or employees of Lessee or of third parties, and whether such property damage be to Lessee’s property or the property of others including, without limitation, liabilities for loss or damage related to the release or threatened release of hazardous substances under the Comprehensive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act or similar or successor law or any state or local equivalent now existing or hereinafter enacted which in any manner arise out of or are incident to any possession, use, operation, condition or storage of any Equipment by Lessee which is proximately caused by the negligent conduct of Lessee, its officers, employees and agents. Lessee hereby assumes responsibility for and agrees to reimburse Lessor for all liabilities, obligations, losses, damages, penalties, claims, actions, costs and expenses including reasonable attorneys’ fees of whatsoever kind and nature, imposed on, incurred by or asserted against Lessor that in any way relate to or arise out of a claim, suit or proceeding, based in whole or in part upon the negligent conduct of Lessee, its officers, employees and agents, to the maximum extent permitted by law. VI. Title and Security Interest Section 6.01. Title. Title to the Equipment shall vest in Lessee when Lessee acquires and accepts the Equipment. Title to the Equipment subject to a Lease will automatically transfer to the Lessor in the event Lessee non-appropriates under Section 4.01 with respect to such Lease or in the event Lessee defaults under Section 9.01 with respect to such Lease. In either of such events, Lessee shall execute and deliver to Lessor such documents as Lessor may request to evidence the passage of legal title to the Equipment subject to such Lease to Lessor. Section 6.02. Security Interest. To secure the payment of all Lessee’s obligations under each Lease, Lessee hereby grants to Lessor a security interest under the Uniform Commercial Code constituting a first lien on the Equipment described more fully on Exhibit “A” to each Schedule. The security interest established by this section includes not only all additions, attachments, repairs and replacements to the Equipment but also all proceeds therefrom. Lessee agrees that Lessor or its assignee may execute such additional documents including financing statements, affidavits, notices, and similar instruments, for and on behalf of Lessee which Lessor deems necessary or appropriate to protect Lessor’s interest in the Equipment and in this Agreement and each Lease. Lessee authorizes Lessor to record such documentation as necessary for Lessor to perfect its security interest. Section 6.03. Personal Property. The Equipment is and shall at all times be and remain personal property notwithstanding that the Equipment or any part thereof may be or hereafter become in any manner affixed or attached to or embedded in or permanently rested upon real property or any building thereon or attached in any manner to what is permanent by means of cement, plaster, nails, bolts, screws or otherwise. DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3 VII. Assignment Section 7.01. Assignment by Lessor. All of Lessor’s rights, title and/or interest in and to each Lease may be assigned and reassigned in whole or in part to one or more assignees or sub-assignees (including a registered owner for lease participation certificates) by Lessor at any time without the consent of Lessee. No such assignment shall be effective as against Lessee until the assignor shall have filed with Lessee written notice of assignment identifying the assignee. Lessee shall pay all Rental Payments due under each Lease to or at the direction of Lessor or the assignee named in the notice of assignment. Lessee shall keep a complete and accurate record of all such assignments. Section 7.02. Assignment by Lessee. None of Lessee’s right, title and interest under this Agreement, each Lease and in the Equipment may be assigned by Lessee unless Lessor approves of such assignment in writing before such assignment occurs and only after Lessee first obtains an opinion from nationally recognized counsel stating that such assignment will not jeopardize the tax-exempt status of the obligation. VIII. Maintenance of Equipment Section 8.01. Lessee shall keep the Equipment in good repair and working order. Lessor shall have no obligation to inspect, test, service, maintain, repair or make improvements or additions to the Equipment under any circumstances. Lessee will be liable for all damage to the Equipment, other than normal wear and tear, caused by Lessee, its employees or its agents. Lessee shall pay for and obtain all permits, licenses and taxes necessary for the installation, operation, possession, storage or use of the Equipment. If the Equipment includes any titled vehicles, then Lessee is responsible for obtaining such titles from the State and also for ensuring that Lessor is listed as first lien holder on all of the titles. Lessee shall not use the Equipment to haul, convey or transport hazardous waste as defined in the Resource Conservation and Recovery Act, 42 U.S.C. 6901 et. seq. Lessee shall not during the term of this Agreement create, incur or assume any levies, liens or encumbrances of any kind with respect to the Equipment except those created by this Agreement. The Equipment is and shall at all times be and remain personal property. Lessee shall allow Lessor to examine and inspect the Equipment at all reasonable times. IX. Default Section 9.01. Events of Default defined. The following events shall constitute an “Event of Default” with respect to a Lease: (a) Failure by Lessee to pay any Rental Payment listed on Exhibit “B” to the Schedule for fifteen 15 days after such payment is due according to the Payment Date listed on Exhibit “B”. (b) Failure to pay any other payment required to be paid under this Agreement and the Schedule at the time specified herein and therein and a continuation of said failure for a period of fifteen 15 days after written notice by Lessor that such payment must be made. If Lessee continues to fail to pay any payment after such period, then Lessor may, but will not be obligated to, make such payments and charge Lessee for all costs incurred plus interest at the highest lawful rate. (c) Failure by Lessee to observe and perform any warranty, covenant, condition, promise or duty under this Agreement or the Schedule for a period of thirty 30 days after written notice specifying such failure is given to Lessee by Lessor, unless Lessor agrees in writing to an extension of time. Lessor will not unreasonably withhold its consent to an extension of time if corrective action is instituted by Lessee. Subsection (c) does not apply to Rental Payments and other payments discussed above. (d) Any statement, material omission, representation or warranty made by Lessee in or pursuant to this Agreement or the Schedule which proves to be false, incorrect or misleading on the date when made regardless of Lessee’s intent and which materially adversely affects the rights or security of Lessor under this Agreement or the applicable Schedule. (e) Any provision of this Agreement or the Schedule which ceases to be valid for whatever reason and the loss of such provision, would materially adversely affect the rights or security of Lessor. (f) Lessee admits in writing its inability to pay its obligations. Lessee defaults on one or more of its other obligations. Lessee applies or consents to the appointment of a receiver or a custodian to manage its affairs. Lessee makes a general assignment for the benefit of creditors. Section 9.02. Remedies on Default. Whenever any Event of Default exists with respect to any Lease, Lessor shall have the right to take one or any combination of the following remedial steps: (a) With or without terminating the Lease, Lessor may declare all Rental Payments and other amounts payable by Lessee thereunder to the end of the then current Budget Year to be immediately due and payable. (b) With or without terminating the Lease, Lessor may require Lessee at Lessee’s expense to redeliver any or all of the Equipment subject thereto to Lessor to a location specified by Lessor. Such delivery shall take place within 15 days after the event of default occurs. If Lessee fails to deliver such Equipment, Lessor may enter the premises where such Equipment is located and take possession of such Equipment and charge Lessee for cost incurred. Notwithstanding that Lessor has taken possession of such Equipment, Lessee shall still be obligated to pay the remaining Rental Payments under the Lease due up until the end of the then current Original Term or Renewal Term. Lessee will be liable for any damage to such Equipment caused by Lessee or its employees or agents. (c) Lessor may take whatever action at law or in equity that may appear necessary or desirable to enforce its rights. Section 9.03. No Remedy Exclusive. No remedy herein conferred upon or reserved to Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under the Lease 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 shall be construed to be a waiver thereof, X. Miscellaneous Section 10.01. Notices. All notices shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, to the parties at their respective places of business as first set forth herein or as the parties shall designate hereafter in writing. Section 10.02. Binding Effect. This Agreement and each Schedule shall inure to the benefit of and shall be binding upon Lessee and Lessor and their respective successors and assigns. Section 10.03. Sever ability. In the event any provision of this Agreement or any Lease 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 10.04. Amendments, Addenda, Changes or Modifications. This Agreement and each Lease may be amended, added to, changed or modified by written agreement duly executed by Lessor and Lessee. Section 10.05. Execution in Counterparts; Electronic Execution. This Agreement and each Lease may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Consent to Electronic Signatures: Lessor and Lessee consent to execute this Agreement and all necessary Exhibits electronically in conformance with the Montana Uniform Electronic Transactions Act, Title 30, Chapter 18, Part 1, MCA. Section 10.06. Captions. The captions or headings in this Agreement do not define, limit or describe the scope or intent of any provisions or sections of this Agreement. DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Section 10.07. Entire Writing. This Agreement and all Schedules executed hereunder constitute the entire writing between Lessor and Lessee. No waiver, consent, modification or change of terms of this Agreement or any Lease shall bind either party unless in writing and signed by both parties, and then such waiver, consent, modification or change shall be effective only in the specific instance and for the specific purpose given. There are no understandings, agreements, representations, conditions, or warranties, express or implied, which are not specified herein regarding this Agreement or any Lease or the Equipment leased thereunder. Any terms and conditions of any purchase order or other documents submitted by Lessee in connection with this Agreement which are in addition to or inconsistent with the terms and conditions of this Agreement or any Lease will not be binding on Lessor and will not apply to this Agreement or any Lease. Section 10.08. Jurisdiction and Venue. Lessor and Lessee agree that this Agreement is governed in all respects by the laws of the State of Montana. Lessee hereby consents to any and all process which may be served in any such suit, action or proceeding, (i) by mailing a copy thereof by registered and certified mail, postage prepaid, return receipt requested, to the Lessee's address shown in this Agreement or as notified to the Lessor and (ii) by serving the same upon the Lessee in any other manner otherwise permitted by law, and agrees that such service shall in every respect be deemed effective service upon Lessee.. Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives listed below. Lessee: City of Bozeman Lessor: Lease Servicing Center, Inc. dba NCL Government Capital By: By: Typed: Jeff Mihelich Print: Title: City Manager Title: Date: __________________________________ Date: _________________________________ DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 EXHIBIT A A DESCRIPTION OF EQUIPMENT OF LEASE AGREEMENT RE: Master Lease Purchase Agreement dated as of 2/3/2023 between Lease Servicing Center, Inc. dba NCL Government Capital (Lessor) and City of Bozeman (Lessee) and Schedule No. 001 thereto dated as of February 3, 2023. Below is a detailed description of all the items of Equipment including quantity, model number and serial number where applicable: Quantity 1 VIN #/Serial Number 4MH12000 Type, Make, Model 2022 Elgin Broom Bear EQUIPMENT LOCATION Complete only if equipment will not be located at Lessee’s address BILLING ADDRESS: 121 N Rouse Ave Bozeman, MT 59715 GARAGING ADDRESS: 814 N Bozeman Ave Bozeman, MT 59715 Lessee authorizes Lessor or its assigns to insert or modify, if needed, the Vehicle Identification Number (“VIN”), or Serial Number, in the above description of the Equipment to correspond to the final delivered and accepted Equipment as shown on the respective invoice or other supporting documents. Lessee: City of Bozeman Lessor: Lease Servicing Center, Inc. dba NCL Government Capital By: By: Typed: Jeff Mihelich Print: Title: City Manager Title: Date: __________________________________ Date: __________________________________ DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 EXHIBIT B B SCHEDULE OF PAYMENTS Interest Rate = 6.612% Amount Financed = $277,720.00 Start Date = 2/17/2023 Number Date Payment Interest Principal Purchase Option* 1 4/1/2023 $63,370.03 $2,193.21 $61,176.82 N/A 2 4/1/2024 $63,370.03 $14,317.00 $49,053.03 $176,300.13 3 4/1/2025 $63,370.03 $11,073.80 $52,296.23 $121,253.12 4 4/1/2026 $63,370.03 $7,616.18 $55,753.85 $62,566.62 5 4/1/2027 $63,370.03 $3,929.96 $59,440.07 $0.00 *Assumes that all rental payments and other amounts due on and prior to that date have been paid. Lessee: City of Bozeman BY: TYPED: Jeff Mihelich TITLE: City Manager DATE: DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 EXHIBIT E E LESSEE RESOLUTION Re: Master Lease Purchase Agreement dated as of 2/3/2023, between Lease Servicing Center, Inc. dba NCL Government Capital (Lessor) and City of Bozeman (Lessee) and Schedule No. 001 thereto dated as of February 3, 2023. At a duly called meeting of the Governing Body of the Lessee (as defined in the Agreement) held on ____________________, 20___ the following resolution was introduced and adopted: BE IT RESOLVED by the Governing Body of Lessee as follows: 1. Determination of Need. The Governing Body of Lessee has determined that a true and very real need exists for the acquisition of the Equipment described on Exhibit A of Schedule No. 001 to the Master Lease Purchase Agreement dated as of 2/3/2023, between City of Bozeman (Lessee) and Lease Servicing Center, Inc. dba NCL Government Capital (Lessor). 2. Approval and Authorization. The Governing Body of Lessee has determined that the Agreement and Schedule, substantially in the form presented to this meeting, are in the best interests of the Lessee for the acquisition of such Equipment, and the Governing Body hereby approves the entering into of the Agreement and Schedule by the Lessee and hereby designates and authorizes the following person(s) to execute and deliver the Agreement and Schedule on Lessee’s behalf with such changes thereto as such person(s) deem(s) appropriate, and any related documents, including any Escrow Agreement, necessary to the consummation of the transaction contemplated by the Agreement and Schedule. The City of Bozeman is authorized to enter into the lease/purchase financing with Lease Servicing Center, Inc. dba NCL Government Capital to finance their 2022 Elgin Broom Bear from Joe Johnson Equipment LLC in the amount of $277,720.00 with 5 annual payments of $63,370.03. Authorized Individual(s): Jeff Mihelich - City Manager (Printed or Typed Name and Title of individual(s) authorized to execute the Agreement) 3. Adoption of Resolution. The signatures below from the designated individuals from the Governing Body of the Lessee evidence the adoption by the Governing Body of this Resolution. By: (Signature of Secretary, Board Chairman or other member of the Governing Body) Print Name: Title: (Print name of individual who signed directly above) (Title of individual who signed directly above) Attested By: (Signature of one additional person who can witness the passage of this Resolution) Print Name: Title: (Print name of individual who signed directly above) (Title of individual who signed directly above) DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Cyndy Andrus MAYOR City ClerkMike Maas March 21 23 EXHIBIT F F BANK QUALIFIED CERTIFICATE Re: Master Lease Purchase Agreement dated as of 2/3/2023, between Lease Servicing Center, Inc. dba NCL Government Capital (Lessor) and City of Bozeman (Lessee) and Schedule No. 001 thereto dated as of February 3, 2023. Whereas, Lessee hereby represents that it is a “Bank Qualified” Issuer for the calendar year in which this Agreement and Schedule are executed by making the following designations with respect to Section 265 of the Internal Revenue Code. (A “Bank Qualified Issuer” is an issuer that issues less than ten million ($10,000,000) dollars of tax-exempt obligations during the calendar year). Now, therefore, Lessee hereby designates this Agreement and Schedule as follows: 1. Designation as Qualified Tax-Exempt Obligation. Pursuant to Section 265(b)(3)(B)(ii) of the Internal Revenue Code of 1986 as amended (the “Code”), the Lessee hereby specifically designates the Agreement and this Schedule as a “qualified tax-exempt obligation” for purposes of Section 265(b)(3) of the Code. In compliance with Section 265(b)(3)(D) of the Code, the Lessee hereby represents that the Lessee will not designate more than $10,000,000 of obligations issued by the Lessee in the calendar year during which the Agreement is executed and delivered as such “qualified tax-exempt obligations”. 2. Issuance Limitation. In compliance with the requirements of Section 265(b)(3)(C) of the Code, the Lessee hereby represents that the Lessee (including all subordinate entities of the Lessee within the meaning of Section 265(b)(3)(E) of the Code) reasonable anticipates not to issue in the calendar year during which the Agreement and Supplement are executed and delivered, obligations bearing interest exempt from federal income taxation under Section 103 of the Code (other than “private activity bonds” as defined in Section 141 of the Code) in an amount greater than $10,000,000. By: (Signature of individual authorized to execute this Exhibit) Typed Name: Jeff Mihelich (Typed name of individual who signed directly above) DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 EXHIBIT G G AGREEMENT TO PROVIDE INSURANCE Lessee: City of Bozeman Lessor: Lease Servicing Center, Inc. dba NCL Government Capital AOIA Address: 121 N Rouse Ave Address: 510 22nd Ave E., Ste 501 Bozeman, MT 59715 Alexandria, MN 56308 Phone: (406) 582-3206 Phone: (320) 763-7600 Description of Equipment: Quantity 1 VIN #/Serial Number 4MH12000 Type, Make, Model 2022 Elgin Broom Bear Value: $304,970.00 I understand that to provide protection from serious financial loss, should an accident or loss occur, my lease contract requires the equipment to be continuously covered with insurance against the risks of fire and theft, and that failure to provide such insurance gives the Lessor the right to declare the entire unpaid balance immediately due and payable. Accordingly, I have arranged for the required insurance through the insurance company shown below and have requested my agent to note Lessor’s interest in the equipment and name Lessor as additional insured. NAME OF AGENT INSURANCE COMPANY Name: Name: Address: Policy #: Phone: Lessee: City of Bozeman BY: TYPED: Jeff Mihelich TITLE: City Manager DATE: DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 406-443-0907 700 W Custer Ave Helena, MT 59604-6669 Montana Municipal Interlocal AuthorityBritani Laughery 012-LIAB-2023-1 3/29/2023 EXHIBIT H H LESSEE CERTIFICATE RE: Master Lease Purchase Agreement dated as of 2/3/2023 between Lease Servicing Center, Inc. dba NCL Government Capital (Lessor) and City of Bozeman (Lessee) and Schedule No. 001 thereto dated as of February 3, 2023. I, the undersigned, hereby certify that I am a duly qualified representative of Lessee and that I have been given the authority by the Governing Body of Lessee to sign this Certificate of Acceptance with respect to the above referenced Master Lease Purchase Agreement (the “Lease”). I hereby certify that: 1. Lessee has appropriated and/or taken other lawful actions necessary to provide moneys sufficient to pay all Rental Payments required to be paid under the Lease during the current Budget Year of Lessee, and such moneys will be applied in payment of all Rental Payments due and payable during such current Budget Year. 2. The governing body of Lessee has approved the authorization, execution and delivery of the Lease on its behalf by the authorized representative of Lessee who signed the Lease. 3. During the term of the Lease, the Equipment will be used for essential governmental functions. Such functions are: ___________________________________________________________________________________ ___________________________________________________________________________________ 4. The source of funds (fund Item in budget) for the Rental Payments that come due under Exhibit B of this Lease is as follows: ___________________________________________________________________________________ ___________________________________________________________________________________ 5. Lessee reasonably expects and anticipates that adequate funds will be available for all future Rental Payments that will come due under Exhibit B because: ___________________________________________________________________________________ ___________________________________________________________________________________ Lessee: City of Bozeman BY: TYPED: Jeff Mihelich TITLE: City Manager DATE: DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Fund. Yes, the property tax assessment for street maintenance will be collected and available for all future rental payments. Property tax assessments for street maintenance accounted for in a separate Street Maintenance Sweep bike lanes. Sweep streets. 3/29/2023 NOTICE OF ASSIGNMENT AND LETTER OF DIRECTION Lease Servicing Center, Inc. dba NCL Government Capital ("Lessor") hereby gives notice to City of Bozeman (“Lessee”) that it has assigned all of its rights to receive payments under the Master Lease Purchase Agreement dated February 3, 2023, Schedule No. 001 as set out in Section 7.01, and in any of the Equipment now or hereafter leased thereunder, including without limitation all amounts of rent, insurance, and condemnation proceeds, indemnity or other payment proceeds due to become due as a result of the sale, lease of other disposition of the Equipment, all rights to receive notices and give consents and to exercise the rights of the Lessor under the Lease, and all rights, claims and causes of action which Assignor may have against the manufacturer or seller of the Equipment in respect of any defects therein. This Master Lease Purchase Agreement requires 5 annual payments of $63,370.03. As of the date of assignment, 5 annual payments of $63,370.03 remain on the contract and should be forwarded to the assignee at the following address: “ASSIGNEE” Santander Bank, N.A. P. O. Box 847386 Boston, MA 02284-7386 1-800-238-4009 FEIN: 23-1237295 * Please list the following as lien holder on vehicle titles: Santander Bank, N.A. 3 Huntington Quadrangle, #101N Melville, NY 11747 Any assigned payments received by Lessor are received in trust for assignee and will be immediately delivered to Assignee. LEASE SERVICING CENTER, INC. DBA CITY OF BOZEMAN NCL GOVERNMENT CAPITAL (Lessor/Assignor) (Lessee) BY: ___________________________ BY: _____________________________ PRINT: TYPED: Jeff Mihelich TITLE: TITLE: City Manager DATE: __________________________ DATE: _____________________________ DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 Internal Escrow Letter 2/3/2023 Santander Bank, N.A. 3 Huntington Quadrangle, Suite 101N Melville, NY 11747 RE: Schedule No. 001 dated February 3, 2023 to Master Lease Purchase Agreement dated as of 2/3/2023 (the “Lease”), between City of Bozeman (Lessee) and Lease Servicing Center Inc. dba NCL Government Capital (Lessor), concurrently assigned to Santander Bank, N.A. (“Assignee”). Ladies and Gentlemen: We have entered into the above referenced Lease for the purpose of financing the equipment listed in Attachment #1 (the "Equipment") in the amount of $277,720.00 (the "Financed Amount"). Lessee hereby requests that Lessor retain $277,720.00 (the "Retained Amount"). Lessee further requests that Lessor hold the Retained Amount in an internal escrow pending Lessor's receipt of confirmation from Lessee that the Equipment has been delivered, inspected and accepted for all purposes by the Lessee and that payment can be remitted to the vendor of such Equipment. There will be no separate escrow fee charged to Lessee for internally escrowing the Retained Amount. Lessee understands and agrees that interest shall accrue on the entire Financed Amount as of the date hereof, and further understands and agrees that any interest earned on the Retained Amount shall be paid to Lessor in consideration of managing the internal escrow account. Lessee acknowledges that Lessor may commingle the Retained Amount held by Lessor for the benefit of Lessee with other funds held by Lessor for its own account, so long as Lessor maintains segregation of such amounts on the books and records of Lessor. Sincerely, Lessee: City of Bozeman BY: TYPED: Jeff Mihelich TITLE: City Manager DATE: DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 Internal Escrow Letter Attachment #1 Quantity Year Make Type/Style/Model VIN/Serial Number Price 1 2022 Elgin Broom Bear 4MH12000 $277,720.00 Total Cost: $277,720.00 Down Payment $0 Total Amount Financed $277,720.00 DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 LEASE PAYMENT INSTRUCTIONS Lessee: ___________________________________________________________________ Tax ID#: ___________________________________________________________________ Invoice Mailing Address: ___________________________________________________ ___________________________________________________ Mail invoices to the attention of: __________________________ Phone: ____________________ Fax: _______________________ Email: _____________________ Approval of Invoices required by: __________________________ Phone: ____________________ Fax: _______________________ Email: _____________________ Accounts Payable Contact: __________________________ Phone: ____________________ Fax: _______________________ Email: _____________________ Processing time for Invoices: ______ Approval: _________Checks: _________ Do you have a Purchase Order Number that you would like included on the invoice? No __ Yes __ PO# ___________________ Description needed for Lease Payment Invoices (up to 54 characters including a PO#) : ___________ _________________________________________________________________________________ Does your PO# change annually? No ____ Yes ____ Processing time for new purchase orders:____________ DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 EXHIBIT C-1 PAYMENT REQUEST AND PARTIAL ACCEPTANCE CERTIFICATE RE: Master Lease Purchase Agreement dated as of February 3, 2023, between Lease Servicing Center, Inc. dba NCL Government Capital (Lessor) and City of Bozeman (Lessee) and Schedule No. 001 thereto. I, the undersigned, hereby certify that I am a duly qualified representative of Lessee and that I have been given the authority by the Governing Body of Lessee to sign this Certificate of Acceptance with respect to the above referenced Master Lease Purchase Agreement and Schedule No. 001 (the “Lease”). I hereby certify that: 1. The Equipment described below (comprising part of the Equipment described on Lease Exhibit A) has been delivered and installed in accordance with Lessee’s specifications and Lessee hereby requests and authorizes Lessor to disburse, or direct the escrow agent to disburse, to Lessee or the vendor described below net proceeds of the Lease in the amount specified by wire transfer or by check. Such amount has not formed the basis for a previous request for payment. 2. Lessee has conducted such inspection and/or testing of such Equipment as it deems necessary and appropriate and hereby acknowledges that it accepts such Equipment for all purposes. 3. Rental Payments are due and owing as set forth in Exhibit B to the Lease. 4. Lessee has obtained insurance coverage as required under the Lease. 5. Lessee is exempt from all personal property taxes and is also exempt from sales and/or use taxes with respect to the Equipment and the Rental Payments. 6. No event or condition that constitutes or would constitute an Event of Default exists as of the date hereof. Quantity Year Make Type/Style/Model VIN/Serial Number Price 1 2022 Elgin Broom Bear 4MH12000 $277,720.00 Total Cost: $277,720.00 Down Payment $0 Total Amount Financed $277,720.00 Vendor Name and Address: Joe Johnson Equipment LLC 62 LaGrange Ave Rochester, NY 14613 Vendor Federal ID Number: Lessee: City of Bozeman BY: TYPED: Jeff Mihelich TITLE: City Manager DATE: DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 EXHIBIT C-2 FINAL ACCEPTANCE Re: Master Lease Purchase Agreement dated as of 2/3/2023, between Lease Servicing Center, Inc. dba NCL Government Capital (Lessor) and City of Bozeman (Lessee) and Schedule No. 001 thereto. I, the undersigned, hereby certify that I am a duly qualified representative of Lessee and that I have been given the authority by the Governing Body of Lessee to sign this Final Acceptance Certificate with respect to the above referenced Master Lease Purchase Agreement and Schedule No. 001 (the “Lease”). I hereby certify that: 1. All Equipment described on Exhibit A has been delivered and installed in accordance with Lessee’s specifications and Lessee hereby requests and authorizes Lessor to direct the escrow agent to apply the remaining net proceeds of the Lease to Lessee’s next Rental Payment due. 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 all purposes. 3. Rental Payments with respect to such Equipment are due and owing as set forth in Exhibit B to the Lease. 4. Lessee has obtained insurance coverage as required under the Lease. 5. Lessee is exempt from all personal property taxes and is also exempt from sales and/or use taxes with respect to the Equipment and the Rental Payments. 6. No event or condition that constitutes or would constitute an Event of Default exists as of the date hereof. Lessee: City of Bozeman BY: TYPED: Jeff Mihelich TITLE: City Manager DATE: DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 3/29/2023 Form 8038-G (Rev. September 2011) Department of the Treasury Internal Revenue Service Information Return for Tax-Exempt Governmental Obligations ▶ Under Internal Revenue Code section 149(e) ▶ See separate instructions. Caution: If the issue price is under $100,000, use Form 8038-GC. OMB No. 1545-0720 Part I Reporting Authority If Amended Return, check here ▶ 1 Issuer’s name 2 Issuer’s employer identification number (EIN) 3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instructions)3b Telephone number of other person shown on 3a 4 Number and street (or P.O. box if mail is not delivered to street address)Room/suite 5 Report number (For IRS Use Only) 3 6 City, town, or post office, state, and ZIP code 7 Date of issue 8 Name of issue 9 CUSIP number 10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see instructions) 10b Telephone number of officer or other employee shown on 10a Part II Type of Issue (enter the issue price). See the instructions and attach schedule. 11 Education ..............................11 12 Health and hospital ..........................12 13 Transportation ............................13 14 Public safety .............................14 15 Environment (including sewage bonds) ....................15 16 Housing ..............................16 17 Utilities ..............................17 18 Other. Describe ▶18 19 If obligations are TANs or RANs, check only box 19a ............. ▶ If obligations are BANs, check only box 19b ................ ▶ 20 If obligations are in the form of a lease or installment sale, check box ........ ▶ Part III Description of Obligations. Complete for the entire issue for which this form is being filed. 21 (a) Final maturity date (b) Issue price (c) Stated redemption price at maturity (d) Weighted average maturity (e) Yield $ $ years % Part IV Uses of Proceeds of Bond Issue (including underwriters’ discount) 22 Proceeds used for accrued interest .....................22 23 Issue price of entire issue (enter amount from line 21, column (b)) ...........23 24 Proceeds used for bond issuance costs (including underwriters’ discount) ..24 25 Proceeds used for credit enhancement ............25 26 Proceeds allocated to reasonably required reserve or replacement fund .26 27 Proceeds used to currently refund prior issues .........27 28 Proceeds used to advance refund prior issues .........28 29 Total (add lines 24 through 28) .......................29 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) ...30 Part V Description of Refunded Bonds. Complete this part only for refunding bonds. 31 Enter the remaining weighted average maturity of the bonds to be currently refunded .... ▶years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded .... ▶years 33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) ...... ▶ 34 Enter the date(s) the refunded bonds were issued ▶ (MM/DD/YYYY) For Paperwork Reduction Act Notice, see separate instructions.Cat. No. 63773S Form 8038-G (Rev. 9-2011) City of Bozeman 81-6001238 John Van Delinder 406-582-3206 121 N Rouse Ave Bozeman, MT 59715 2/17/2023 Master Lease Purchase Agreement Dated as of February 3, 2023 Aaron Funk - Controller 406-582-2335 2022 Elgin Broom Bear 277,720 00 4/01/2027 277,720.00 4.08 6.612 DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Form 8038-G (Rev. 9-2011)Page 2 Part VI Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) ....35 36 a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIC) (see instructions) .........................36a b Enter the final maturity date of the GIC ▶ c Enter the name of the GIC provider ▶ 37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental units ........................37 38 a If this issue is a loan made from the proceeds of another tax-exempt issue, check box ▶and enter the following information: b Enter the date of the master pool obligation ▶ c Enter the EIN of the issuer of the master pool obligation ▶ d Enter the name of the issuer of the master pool obligation ▶ 39 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box .... ▶ 40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box ............. ▶ 41 a If the issuer has identified a hedge, check here ▶and enter the following information: b Name of hedge provider ▶ c Type of hedge ▶ d Term of hedge ▶ 42 If the issuer has superintegrated the hedge, check box ..................... ▶ 43 If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated according to the requirements under the Code and Regulations (see instructions), check box ........ ▶ 44 If the issuer has established written procedures to monitor the requirements of section 148, check box ..... ▶ 45a If some portion of the proceeds was used to reimburse expenditures, check here ▶and enter the amount of reimbursement ......... ▶ b Enter the date the official intent was adopted ▶ Signature and Consent Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. I further declare that I consent to the IRS’s disclosure of the issuer’s return information, as necessary to process this return, to the person that I have authorized above.▲Signature of issuer’s authorized representative Date ▲Type or print name and title Paid Preparer Use Only Print/Type preparer’s name Preparer's signature Date Check if self-employed PTIN Firm’s name ▶ Firm's address ▶ Firm's EIN ▶ Phone no. Form 8038-G (Rev. 9-2011) DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Userid: CPM Schema: instrx Leadpct: 100%Pt. size: 9 Draft Ok to PrintAH XSL/XML Fileid: Instructions/I8038G/201209/A/XML/Cycle04/source (Init. & Date) _______Page 1 of 4 14:33 - 10-Aug-2012The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Instructions for Form 8038-G(Rev. September 2012) (Use with the September 2011 revision of Form 8038-G.) Information Return for Tax-Exempt Governmental Obligations Department of the TreasuryInternal Revenue Service Section references are to the Internal Revenue Code unless otherwise noted. General Instructions Purpose of Form Form 8038-G is used by issuers of tax-exempt governmental obligations to provide the IRS with the information required by section 149(e) and to monitor the requirements of sections 141 through 150. Who Must File IF the issue price (line 21, column (b)) is... THEN, for tax-exempt governmental obligations issued after December 31, 1986, issuers must file... $100,000 or more A separate Form 8038-G for each issue Less than $100,000 Form 8038-GC, Information Return for Small Tax-Exempt Governmental Bond Issues, Leases, and Installment Sales For all build America bonds and recovery zone economic development bonds use Form 8038-B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds. For tax credit bonds and specified tax credit bonds use Form 8038-TC, Information Return for Tax Credit Bonds and Specified Tax Credit Bonds. When To File File Form 8038-G on or before the 15th day of the 2nd calendar month after the close of the calendar quarter in which the bond is issued. Form 8038-G may not be filed before the issue date and must be completed based on the facts as of the issue date. Late filing. An issuer may be granted an extension of time to file Form 8038-G under Section 3 of Rev. Proc. 2002-48, 2002-37 I.R.B. 531, if it is determined that the failure to file timely is not due to willful neglect. Type or print at the top of the form “Request for Relief under section 3 of Rev. Proc. 2002-48” and attach a letter explaining why Form 8038-G was not submitted to the IRS on time. Also indicate whether the bond issue in question is under examination by the IRS. Do not CAUTION ! submit copies of the trust indenture or other bond documents. See Where To File next. Where To File File Form 8038-G, and any attachments, with the Department of the Treasury, Internal Revenue Service Center, Ogden, UT 84201. Private delivery services. You can use certain private delivery services designated by the IRS to meet the “timely mailing as timely filing/paying” rule for tax returns and payments. These private delivery services include only the following:DHL Express (DHL): DHL Same Day Service.Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First.United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A.M., UPS Worldwide Express Plus, and UPS Worldwide Express. The private delivery service can tell you how to get written proof of the mailing date. Other Forms That May Be Required For rebating arbitrage (or paying a penalty in lieu of arbitrage rebate) to the Federal government, use Form 8038-T, Arbitrage Rebate, Yield Reduction and Penalty in Lieu of Arbitrage Rebate. For private activity bonds, use Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues. For build America bonds (Direct Pay), build America bonds (Tax Credit), and recovery zone economic development bonds, complete Form 8038-B, Information Return for Build America Bonds and Recovery Zone Economic Development Bonds. For qualified forestry conservation bonds, new clean renewable energy bonds, qualified energy conservation bonds, qualified zone academy bonds, qualified school construction bonds, clean renewable energy bonds, and all other qualified tax credit bonds (except build America bonds), file Form 8038-TC, Information Return for Tax Credit Bonds and Specified Tax Credit Bonds. Rounding to Whole Dollars You may show amounts on this return as whole dollars. To do so, drop amounts less than 50 cents and increase amounts from 50 cents through 99 cents to the next higher dollar. Questions on Filing Form 8038-G For specific questions on how to file Form 8038-G send an email to the IRS at TaxExemptBondQuestions@irs.gov and put “Form 8038-G Question” in the subject line. In the email include a description of your question, a return email address, the name of a contact person, and a telephone number. Definitions Tax-exempt obligation. This is any obligation, including a bond, installment purchase agreement, or financial lease, on which the interest is excluded from income under section 103. Tax-exempt governmental obligation. A tax-exempt obligation that is not a private activity bond (see next) is a tax-exempt governmental obligation. This includes a bond issued by a qualified volunteer fire department under section 150(e). Private activity bond. This includes an obligation issued as part of an issue in which:More than 10% of the proceeds are to be used for any private activity business use, andMore than 10% of the payment of principal or interest of the issue is either (a) secured by an interest in property to be used for a private business use (or payments for such property) or (b) to be derived from payments for property (or borrowed money) used for a private business use. It also includes a bond, the proceeds of which (a) are to be used directly or indirectly to make or finance loans (other than loans described in section 141(c)(2)) to persons other than governmental units and (b) exceeds the lesser of 5% of the proceeds or $5 million. Issue price. The issue price of obligations is generally determined under Regulations section 1.148-1(b). Thus, Aug 10, 2012 Cat. No. 63774D DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Page 2 of 4 Fileid: Instructions/I8038G/201209/A/XML/Cycle04/source 14:33 - 10-Aug-2012The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. when issued for cash, the issue price is the first price at which a substantial amount of the obligations are sold to the public. To determine the issue price of an obligation issued for property, see sections 1273 and 1274 and the related regulations. Issue. Generally, obligations are treated as part of the same issue if they are issued by the same issuer, on the same date, and in a single transaction, or a series of related transactions. However, obligations issued during the same calendar year (a) under a loan agreement under which amounts are to be advanced periodically (a “draw-down loan”) or (b) with a term not exceeding 270 days, may be treated as part of the same issue if the obligations are equally and ratably secured under a single indenture or loan agreement and are issued under a common financing arrangement (for example, under the same official statement periodically updated to reflect changing factual circumstances). Also, for obligations issued under a draw-down loan that meet the requirements of the preceding sentence, obligations issued during different calendar years may be treated as part of the same issue if all of the amounts to be advanced under the draw-down loan are reasonably expected to be advanced within 3 years of the date of issue of the first obligation. Likewise, obligations (other than private activity bonds) issued under a single agreement that is in the form of a lease or installment sale may be treated as part of the same issue if all of the property covered by that agreement is reasonably expected to be delivered within 3 years of the date of issue of the first obligation. Arbitrage rebate. Generally, interest on a state or local bond is not tax-exempt unless the issuer of the bond rebates to the United States arbitrage profits earned from investing proceeds of the bond in higher yielding nonpurpose investments. See section 148(f). Construction issue. This is an issue of tax-exempt bonds that meets both of the following conditions: 1. At least 75% of the available construction proceeds are to be used for construction expenditures with respect to property to be owned by a governmental unit or a section 501(c)(3) organization, and 2. All the bonds that are part of the issue are qualified 501(c)(3) bonds, bonds that are not private activity bonds, or private activity bonds issued to finance property to be owned by a governmental unit or a section 501(c)(3) organization. In lieu of rebating any arbitrage that may be owed to the United States, the issuer of a construction issue may make an irrevocable election to pay a penalty. The penalty is equal to 11 2% of the amount of construction proceeds that do not meet certain spending requirements. See section 148(f)(4)(C) and the Instructions for Form 8038-T. Pooled financing issue. This is an issue of tax-exempt bonds, the proceeds of which are to be used to finance purpose investments representing conduit loans to two or more conduit borrowers, unless those conduit loans are to be used to finance a single capital project. Specific Instructions Part I—Reporting Authority Amended return. An issuer may file an amended return to change or add to the information reported on a previously filed return for the same date of issue. If you are filing to correct errors or change a previously filed return, check the Amended Return box in the heading of the form. The amended return must provide all the information reported on the original return, in addition to the new or corrected information. Attach an explanation of the reason for the amended return and write across the top, “Amended Return Explanation.” Failure to attach an explanation may result in a delay in processing the form. Line 1. The issuer's name is the name of the entity issuing the obligations, not the name of the entity receiving the benefit of the financing. For a lease or installment sale, the issuer is the lessee or the purchaser. Line 2. An issuer that does not have an employer identification number (EIN) should apply for one on Form SS-4, Application for Employer Identification Number. You can get this form on the IRS website at IRS.gov or by calling 1-800-TAX-FORM (1-800-829-3676). You may receive an EIN by telephone by following the instructions for Form SS-4. Line 3a. If the issuer wishes to authorize a person other than an officer or other employee of the issuer (including a legal representative or paid preparer) to communicate with the IRS and whom the IRS may contact about this return (including in writing or by telephone), enter the name of such person here. The person listed in line 3a must be an individual. Do not enter the name and title of an officer or other employee of the issuer here (use line 10a for that purpose). Note. By authorizing a person other than an authorized officer or other employee of the issuer to communicate with the IRS and whom the IRS may contact about this return, the issuer authorizes the IRS to communicate directly with the individual entered on line 3a and consents to disclose the issuer's return information to that individual, as necessary, to process this return. Lines 4 and 6. If you listed an individual on line 3a to communicate with the IRS and whom the IRS may contact about this return, enter the number and street (or P.O. box if mail is not delivered to street address), city, town, or post office, state, and ZIP code of that person. Otherwise, enter the issuer's number and street (or P.O. box if mail is not delivered to street address), city, town, or post office, state, and ZIP code. Note. The address entered on lines 4 and 6 is the address the IRS will use for all written communications regarding the processing of this return, including any notices. Line 5. This line is for IRS use only. Do not make any entries in this box. Line 7. The date of issue is generally the date on which the issuer physically exchanges the bonds that are part of the issue for the underwriter's (or other purchaser's) funds. For a lease or installment sale, enter the date interest starts to accrue in an MM/DD/YYYY format. Line 8. If there is no name of the issue, please provide other identification of the issue. Line 9. Enter the CUSIP (Committee on Uniform Securities Identification Procedures) number of the bond with the latest maturity. If the issue does not have a CUSIP number, write “None.” Line 10a. Enter the name and title of the officer or other employee of the issuer whom the IRS may call for more information. If the issuer wishes to designate a person other than an officer or other employee of the issuer (including a legal representative or paid preparer) whom the IRS may call for more information about the return, enter the name, title, and telephone number of such person on lines 3a and 3b. Complete lines 10a and 10b even if you complete lines 3a and 3b. Part II—Type of Issue Elections referred to in Part II are made on the original bond documents, not on this form. Identify the type of obligations issued by entering the corresponding issue price (see Issue price under Definitions earlier). Attach a schedule listing names and EINs of organizations that are to use proceeds of these obligations, if different from those CAUTION ! CAUTION ! -2- DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Page 3 of 4 Fileid: Instructions/I8038G/201209/A/XML/Cycle04/source 14:33 - 10-Aug-2012The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. of the issuer, include a brief summary of the use and indicate whether or not such user is a governmental or nongovernmental entity. Line 18. Enter a description of the issue in the space provided. Line 19. If the obligations are short-term tax anticipation notes or warrants (TANs) or short-term revenue anticipation notes or warrants (RANs), check box 19a. If the obligations are short-term bond anticipation notes (BANs), issued with the expectation that they will be refunded with the proceeds of long-term bonds at some future date, check box 19b. Do not check both boxes. Line 20. Check this box if property other than cash is exchanged for the obligation, for example, acquiring a police car, a fire truck, or telephone equipment through a series of monthly payments. (This type of obligation is sometimes referred to as a “municipal lease.”) Also check this box if real property is directly acquired in exchange for an obligation to make periodic payments of interest and principal. Do not check this box if the proceeds of the obligation are received in the form of cash, even if the term “lease” is used in the title of the issue. Part III—Description of Obligations Line 21. For column (a), the final maturity date is the last date the issuer must redeem the entire issue. For column (b), see Issue price under Definitions earlier. For column (c), the stated redemption price at maturity of the entire issue is the sum of the stated redemption prices at maturity of each bond issued as part of the issue. For a lease or installment sale, write “N/A” in column (c). For column (d), the weighted average maturity is the sum of the products of the issue price of each maturity and the number of years to maturity (determined separately for each maturity and by taking into account mandatory redemptions), divided by the issue price of the entire issue (from line 21, column (b)). For a lease or installment sale, enter instead the total number of years the lease or installment sale will be outstanding. For column (e), the yield, as defined in section 148(h), is the discount rate that, when used to compute the present value of all payments of principal and interest to be paid on the obligation, produces an amount equal to the purchase price, including accrued interest. See Regulations section 1.148-4 for specific rules to compute the yield on an issue. If the issue is a variable rate issue, write “VR” as the yield of the issue. For other than variable rate issues, carry the yield out to four decimal places (for example, 5.3125%). If the issue is a lease or installment sale, enter the effective rate of interest being paid. Part IV—Uses of Proceeds of Bond Issue For a lease or installment sale, write “N/A” in the space to the right of the title for Part IV. Line 22. Enter the amount of proceeds that will be used to pay interest from the date the bonds are dated to the date of issue. Line 24. Enter the amount of the proceeds that will be used to pay bond issuance costs, including fees for trustees and bond counsel. If no bond proceeds will be used to pay bond issuance costs, enter zero. Do not leave this line blank. Line 25. Enter the amount of the proceeds that will be used to pay fees for credit enhancement that are taken into account in determining the yield on the issue for purposes of section 148(h) (for example, bond insurance premiums and certain fees for letters of credit). Line 26. Enter the amount of proceeds that will be allocated to such a fund. Line 27. Enter the amount of the proceeds that will be used to pay principal, interest, or call premium on any other issue of bonds within 90 days of the date of issue. Line 28. Enter the amount of the proceeds that will be used to pay principal, interest, or call premium on any other issue of bonds after 90 days of the date of issue, including proceeds that will be used to fund an escrow account for this purpose. Part V—Description of Refunded Bonds Complete this part only if the bonds are to be used to refund a prior issue of tax-exempt bonds. For a lease or installment sale, write “N/A” in the space to the right of the title for Part V. Lines 31 and 32. The remaining weighted average maturity is determined without regard to the refunding. The weighted average maturity is determined in the same manner as on line 21, column (d). Line 34. If more than a single issue of bonds will be refunded, enter the date of issue of each issue. Enter the date in an MM/DD/YYYY format. Part VI—Miscellaneous Line 35. An allocation of volume cap is required if the nonqualified amount for the issue is more than $15 million but is not more than the amount that would cause the issue to be private activity bonds. Line 36. If any portion of the gross proceeds of the issue is or will be invested in a guaranteed investment contract (GIC), as defined in Regulations section 1.148-1(b), enter the amount of the gross proceeds so invested, as well as the final maturity date of the GIC and the name of the provider of such contract. Line 37. If the issue is a pooled financing issue (as defined under Pooled financing issue in Definitions), enter the amount of the proceeds used to make loans to other governmental units, the interest on which is tax-exempt. Line 38. If the issue is a loan of proceeds from a pooled financing issue (as defined under Pooled financing issue in Definitions), check the box and where asked for the date of issue, EIN, and name of the issuer of the master pool obligation, enter the date of issue, EIN, and name of the issuer of the pooled financing issue. Line 40. Check this box if the issue is a construction issue and an irrevocable election to pay a penalty in lieu of arbitrage rebate has been made on or before the date the bonds were issued. The penalty is payable with a Form 8038-T for each 6-month period after the date the bonds are issued. Do not make any payment of penalty in lieu of arbitrage rebate with this form. See Rev. Proc. 92-22, 1992-1 C.B. 736 for rules regarding the “election document.” Line 41a. Check this box if the issuer has identified a hedge on its books and records according to Regulations sections 1.148-4(h)(2)(viii) and 1.148-4(h)(5) that permit an issuer of tax-exempt bonds to identify a hedge for it to be included in yield calculations for computing arbitrage. Line 42. In determining if the issuer has super-integrated a hedge, apply the rules of Regulations section 1.148-4(h)(4). If the hedge is super-integrated, check the box. Line 43. If the issuer takes a “deliberate action” after the issue date that causes the conditions of the private business tests or the private loan financing test to be met, then such issue is also an issue of private activity bonds. Regulations section 1.141-2(d)(3) defines a deliberate action as any action taken by the issuer that is within its control regardless of whether there is intent to violate such tests. Regulations section 1.141-12 explains the conditions to taking remedial action that prevent an action that causes an issue to meet the private business tests or private loan financing test from being treated as a deliberate action. Check the box if the issuer has established written procedures to ensure timely remedial action for all nonqualified bonds according to -3- DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223 Page 4 of 4 Fileid: Instructions/I8038G/201209/A/XML/Cycle04/source 14:33 - 10-Aug-2012The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Regulations section 1.141-12 or other remedial actions authorized by the Commissioner under Regulations section 1.141-12(h). Line 44. Check the box if the issuer has established written procedures to monitor compliance with the arbitrage, yield restriction, and rebate requirements of section 148. Line 45a. Check the box if some part of the proceeds was used to reimburse expenditures. Figure and then enter the amount of proceeds that are used to reimburse the issuer for amounts paid for a qualified purpose prior to the issuance of the bonds. See Regulations section 1.150-2. Line 45b. An issuer must adopt an official intent to reimburse itself for preissuance expenditures within 60 days after payment of the original expenditure unless excepted by Regulations section 1.150-2(f). Enter the date the official intent was adopted. See Regulations section 1.150-2(e) for more information about official intent. Signature and Consent An authorized representative of the issuer must sign Form 8038-G and any applicable certification. Also print the name and title of the person signing Form 8038-G. The authorized representative of the issuer signing this form must have the authority to consent to the disclosure of the issuer's return information, as necessary to process this return, to the person(s) that have been designated in Form 8038-G. Note. If the issuer in Part 1, lines 3a and 3b authorizes the IRS to communicate (including in writing and by telephone) with a person other than an officer or other employee of the issuer, by signing this form, the issuer's authorized representative consents to the disclosure of the issuer's return information, as necessary to process this return, to such person. Paid Preparer If an authorized officer of the issuer filled in this return, the paid preparer's space should remain blank. Anyone who prepares the return but does not charge the organization should not sign the return. Certain others who prepare the return should not sign. For example, a regular, full-time employee of the issuer, such as a clerk, secretary, etc., should not sign. Generally, anyone who is paid to prepare a return must sign it and fill in the other blanks in the Paid Preparer Use Only area of the return. The paid preparer must:Sign the return in the space provided for the preparer's signature (a facsimile signature is acceptable),Enter the preparer information, andGive a copy of the return to the issuer. Paperwork Reduction Act Notice. We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws. You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required by section 6103. The time needed to complete and file this form varies depending on individual circumstances. The estimated average time is: Learning about the law or the form ........... 2 hr., 41 min. Preparing, copying, assembling, and sending the form to the IRS .... 3 hr., 3 min. If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear from you. You can write to the Internal Revenue Service, Tax Products Coordinating Committee, SE:W:CAR:MP:T:M:S, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send the form to this office. Instead, see Where To File. -4- DocuSign Envelope ID: F6C19076-7192-4496-BE1F-F6E3AC59C223