HomeMy WebLinkAbout13350RESOLUTION NO. 13350
A RESOLUTION APPROVING A STATE AND MUNICIPAL
LEASE/PURCHASE AGREEMENT BETWEEN THE CITY
OF PUEBLO, A MUNICIPAL CORPORATION, AND
COMMERCE BANK, A MISSOURI BANKING
CORPORATION, AND APPROVING AN ESCROW
AGREEMENT, AUTHORIZING EXECUTION THEREOF BY
THE PRESIDENT OF THE CITY COUNCIL, AND
AUTHORIZING THE EXECUTION AND DELIVERY OF ALL
OTHER DOCUMENTS REQUIRED THEREWITH BY THE
CITY MANAGER, AND AUTHORIZING ALL OTHER ACTION
NECESSARY TO THE CONSUMMATION OF THE
TRANSACTION CONTEMPLATED BY THIS RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
WHEREAS, the City of Pueblo, a Municipal Corporation (hereinafter “City”), is a
Colorado home rule city duly organized and existing under and by virtue of Article XX of
the Colorado Constitution, and is authorized thereby to purchase and lease personal
property for its municipal purposes for the benefit of City and its inhabitants and to enter
into contracts with respect thereto; and
WHEREAS, the City desires to purchase, acquire and lease certain fire apparatus
and equipment constituting personal property necessary for the performance of the Fire
Department’s duties; and
WHEREAS, the City desires to purchase, acquire and lease certain equipment
necessary for the City’s telephone network and voicemail system and such equipment
constitutes personal property necessary for the performance of all of the City’s duties and
function; and
WHEREAS, in order to acquire such equipment, City proposes to enter into a
Lease/Purchase Agreement, including all incorporated exhibits attached thereto (the
“Agreement”) with Commerce Bank, a Missouri Banking Corporation or a subsidiary
thereof (the “Lessor”), and Escrow Agreement with the Escrow Agent in substantially the
form as attached hereto; and
WHEREAS, City Council, as the governing body of the City, deems it for the benefit
of City and for the efficient and effective administration thereof to enter into the Agreement
for the purchase, acquisition and leasing of equipment therein described on the terms
and conditions therein provided; and
WHEREAS, the funds made available under the Lease will be applied to the
acquisition of the equipment in accordance with the terms of such Agreement and Escrow
Agreement; NOW, THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The form, terms and provisions of the Agreement are hereby approved in
substantially the form attached hereto with such insertions, omissions and changes as
shall be approved by the President of City Council and the City Attorney, the execution of
such documents being conclusive evidence of such approval; and the President of the
City Council is hereby authorized and directed to execute the Agreement and to deliver
the Agreement, and the City Clerk is authorized and directed to attest same and affix the
seal of the City thereto.
SECTION 2.
The City Manager is authorized and directed to take all action necessary or
reasonably required by the parties to the Agreement to carry out, give effect to and
consummate the transactions contemplated thereby (including the execution and delivery
of Acceptance Certificates, Payment Requests, any Tax Agreement and Arbitrage
Certificate, and Incumbency Certificate each with respect to the Equipment Schedule, as
contemplated in the Agreement) and to take all action necessary in conformity therewith,
including, without limitation, the execution and delivery of any closing and other
documents required to be delivered in connection with the Agreement.
SECTION 3.
The Agreement is expressly made subject to sufficient appropriations being made
therefore in each fiscal year after 2015. Nothing contained in this Resolution and the
Agreement, nor any other instrument, shall be construed with respect to the City as
incurring a pecuniary liability or charge upon the general credit of the City or against its
taxing power, nor shall the breach of any agreement contained in this Resolution and the
Agreement or any other instrument or document executed in connection therewith impose
any pecuniary liability upon the City or any charge upon its general credit or against its
taxing power, except to the extent that the rental payments payable under the Agreement
are special limited obligations of the Lessee as provided in such Agreement. Nothing in
the Agreement is intended, nor shall it be construed, to create any multiple-fiscal year
direct or indirect debt or other financial obligation whatsoever of the City.
SECTION 4.
The City Manager and Director of Finance of the City are each hereby designed to
act as authorized representatives of the City for purposes of the Agreement until such
time as the City Council shall designate any other or different authorized representative
for purposes of the Agreement.
SECTION 5.
The officers of the City are directed and authorized to perform any and all acts
consistent with the intent of this Resolution to effectuate the policies and procedures
described herein.
SECTION 6.
This Resolution shall become effective immediately upon final passage.
INTRODUCED: December 28, 2015
BY: Dennis Flores
City Clerk’s Office Item # M-2
Background Paper for Proposed
Resolution
COUNCIL MEETING DATE: December 28, 2015
TO: President Stephen G. Nawrocki and Members of City Council
CC: Sam Azad, City Manager
VIA: Gina Dutcher, City Clerk
FROM: Roni Kimbrel, Director Finance Department
Shawn Shelton, Fire Chief
Lori Pinz, Director Information Technology
SUBJECT: A RESOLUTION APPROVING A STATE AND MUNICIPAL LEASE/PURCHASE
AGREEMENT BETWEEN THE CITY OF PUEBLO, A MUNICIPAL
CORPORATION, AND COMMERCE BANK, A MISSOURI BANKING
CORPORATION, AND APPROVING AN ESCROW AGREEMENT,
AUTHORIZING EXECUTION THEREOF BY THE PRESIDENT OF THE CITY
COUNCIL, AND AUTHORIZING THE EXECUTION AND DELIVERY OF ALL
OTHER DOCUMENTS REQUIRED THEREWITH BY THE CITY MANAGER, AND
AUTHORIZING ALL OTHER ACTION NECESSARY TO THE CONSUMMATION
OF THE TRANSACTION CONTEMPLATED BY THIS RESOLUTION
SUMMARY:
This Resolution allow the Fire Department and IT Department to purchase necessary equipment.
PREVIOUS COUNCIL ACTION:
Not applicable.
BACKGROUND:
This resolution approves the master lease purchase agreement for the acquisition of two 2016
Peirce triple combination fire pumper trucks that will come fully equipped, one 2016 F-150
assistant Chief vehicle that is response ready, and two 2016 Ford Fusion staff cars. The two
Peirce pumper trucks will replace a 1997 Peirce pumper from station 5 and a 1996 Peirce pumper
from station 7. The equipment for these units will be supplied by two separate vendors. The
proposed 2016 F-150 Assistant Chief response vehicle will replace a 2002 F150 with over
150,000 miles and will be outfitted with emergency equipment by a separate vendor. The two
2016 food fusion staff cars will replace two 2001 ford Taurus each with over 150,000 miles. The
proposed vendors were selected after careful consideration of all submitted bids and represent
the best value for the city. The total cost of this project will be $992,906.84 plus interest.
As of April 2016, the voicemail system integrated with the City’s current phone system will no
longer be supported. The system and its hardware is obsolete and over 13 years old. Spare parts
are becoming increasingly difficult to locate. The City relies heavily on its voicemail system to
conduct its day-to-day business; therefore, it is imperative that we eliminate the possibility of a
catastrophic failure. To address the issue, the Information Technology Department conducted a
detailed analysis on replacing the voicemail component as well as the costs associated with the
next required upgrade to CORE phone system. Hosted Voice-over-IP (VoIP) solutions, other
VoIP manufacturer based phone systems, and upgrade options for our current Avaya system
were considered. To control costs, meet department voice and call accounting requirements, and
effectively manage VoIP network traffic across our Avaya network, it was determined that
upgrading our Avaya CS1K PBX with an Avaya IP Office solution was the best solution. As part
of this upgrade, the City of Pueblo’s core data network will need to be upgraded to accommodate
the new system. The current Avaya data switches will be upgraded to the Avaya Virtual Services
Platform (VSP) High availability 8400 data switches.
The new VoIP system will replace the current Avaya CS1K telephone network, including
handsets, in all current locations. The configuration also includes additional equipment and
licensing for 3 Fire Stations not currently served by the present system. This will eliminate leased
phone lines in these Fire Stations. All installed equipment, with the exception of phone sets (1-
year), will be covered under a 3-year warranty, maintenance and support plans which includes
software upgrades. Warranty coverage begins upon City acceptance of equipment.
FINANCIAL IMPLICATIONS:
The Fire Department vehicles and equipment and the Information Technology phone, voicemail
and data network upgrade equipment financing package totals $1,541,617.84, which will be
amortized over six years. The Fire Department and Information Technology Department will
make their respective lease payments through their operating budget. The City’s obligation under
the equipment lease shall be subject to annual appropriation by the City Council which is
recommended by the respective department directors.
Payment schedule for the lease/purchase payments, including interest at 1.82%, is as follows:
The City’s obligation under the equipment lease shall be subject to annual appropriation by the
City Council.
BOARD/COMMISSION RECOMMENDATION:
Not applicable.
STAKEHOLDER PROCESS:
Not applicable.
ALTERNATIVES:
City Council could deny this Resolution.
RECOMMENDATION:
Approve the Resolution
Attachments:
State and Municipal Lease/Purchase Agreement with Exhibits A through E
Escrow Agreement with Exhibits A through C
40*
®4,0®
COMMERCE BANK
STATE&MUNICIPAL LEASE/PURCHASE AGREEMENT
Lease Number: 1001112-003
This State and Municipal Lease/Purchase Agreement(the"Lease")is made and entered into on this,the Twenty-Eighth day of December,2015,by and
between Commerce Bank,with offices at 8000 Forsyth Boulevard, St. Louis, Missouri 63105 (herein called the"Lessor"), and the City of Pueblo, A
Municipal Corporation with its principal address at 230 S.Mechanic Street,Pueblo,Colorado 81003(herein called the"Lessee"),wherein it is agreed
as follows:
1. LEASE OF EQUIPMENT: Lessee hereby requests Lessor to acquire the equipment described in Exhibit A attached hereto and made a part
hereof. Subject to the terms and conditions hereof, Lessor agrees to lease to Lessee and Lessee agrees to lease from Lessor the equipment
described in Exhibit A, with all replacement parts, repairs, additions and accessories incorporated therein or affixed thereto (herein collectively
called the"Equipment").
2. DELIVERY AND ACCEPTANCE: Lessee agrees to order the Equipment from the supplier of such Equipment, but will not be liable for specific
performance of this Lease or for damages if for any reason the supplier delays or fails to fill the order. Lessee will cause the Equipment to be
delivered at the location specified in Exhibit A(the"Equipment Location"). Lessee will pay all transportation and other costs, if any, incurred in
connection with the delivery and installation of the Equipment. Any delay in such delivery will not affect the validity of this Lease. Lessee will
accept the Equipment as soon as it has been delivered and is operational, or as soon as any manufacturer or vendor preacceptance test period
has expired. Lessee will have no more than thirty(30)days from the date of delivery of the Equipment to accept such Equipment. In the event the
Equipment is not accepted by Lessee within thirty(30)days from the date of its delivery, Lessor, at Lessor's sole option, will have the right to
terminate this Lease. Lessee will evidence its acceptance of the Equipment by executing and delivering to Lessor a delivery and acceptance
certificate in the form of Exhibit B attached hereto and made a part hereof(the"Acceptance Certificate"). Lessee hereby authorizes the Lessor to
add to this Lease and to any other description of the Equipment the serial number of each item of Equipment when available.
3. TERM: This Lease will become effective upon the execution hereof by Lessee and Lessor. The initial term of this Lease will commence on the
earlier of the date Lessee executes the Acceptance Certificate or the date funds sufficient to purchase the Equipment are deposited with a bank or
trust company in an escrow fund(the"Start Date")and will extend through the end of Lessee's fiscal year containing the Start Date. Unless earlier
terminated as expressly provided for in this Lease,the term of this Lease will be automatically renewed on a year-to-year basis for the number of
annual fiscal periods necessary to comprise the lease term as set forth in Exhibit C attached hereto and made a part hereof(the"Lease Term").
4. RENT: Lessee agrees to pay Lessor or any Assignee (as defined in Section 22 below), the rental payments for the Equipment as set forth in
Exhibit C(the"Rental Payments"). A portion of each Rental Payment is paid as and represents the payment of interest as set forth in Exhibit C.
The Rental Payments will be payable without notice or demand, at the office of Lessor (or such other place as Lessor or any Assignee may
designate in writing, from time to time) and will commence on the Start Date or as otherwise set forth in Exhibit C, and the remaining Rental
Payments will be payable on the same day of each consecutive month or quarter or semiannual or annual period thereafter(as designated in
Exhibit C) for the duration of the Lease Term. Any notice, invoicing, purchase orders, quotations or other forms or procedures requested by
Lessee in connection with payment will be fully explained and provided to Lessor or any Assignee sufficiently in advance of the payment due date
for the completion thereof by Lessor or any Assignee prior to such payment date, but none of the foregoing will be a condition to Lessee's
obligation to make any such payment. If Lessee fails to pay any monthly rental payment or any other sums under the Lease within ten(10)days
when the same becomes due, Lessee shall pay to Lessor(in addition to and not in lieu of other rights of Lessor)a late charge equal to the greater
of five(5%) percent of such delinquent amount or Twenty-Five Dollars($25.00), but in any event not more than the maximum permitted by law.
Such late charge shall be payable by Lessee upon demand by Lessor and shall be deemed rent hereunder. Lessee acknowledges and agrees
that the late charge (i) does not constitute interest, (ii) is an estimate of the costs Lessor will incur as a result of the late payment and (iii) is
reasonable in amount. Lessor and Lessee understand and intend that the obligation of Lessee to pay Rental Payments hereunder will constitute a
current expense of Lessee and will not in any way be construed to be a debt of Lessee in contravention of any applicable constitutional or
statutory limitation or requirement concerning the creation of indebtedness by Lessee. EXCEPT AS SPECIFICALLY PROVIDED IN SECTION 8
HEREOF,THE RENTAL PAYMENTS SHALL BE ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS AND WILL NOT BE SUBJECT TO ANY
SETOFF, DEFENSE,COUNTERCLAIM,ABATEMENT OR RECOUPMENT FOR ANY REASON WHATSOEVER.
Notwithstanding the foregoing, in the event that Lessee, by its use of the Equipment or by its actions or omissions or by any means whatsoever,
causes any interest payments as set forth in Exhibit C to be included in Lessor's gross income, Lessee agrees that the interest portion of the
Rental Payments on Exhibit C will be adjusted commencing with the first day of the next succeeding fiscal year of the Lessee, but only if this
Lease is renewed for such fiscal year, and thereafter, so that Lessor, its Assignees and any participants with such, will be in the same after-tax
position they would have been in had such payment been excluded from the gross income of Lessor, its Assignees and any participants with such
under Section 103 of the Code.
5. AUTHORITY AND AUTHORIZATION: Lessee represents,warrants and covenants that(a)it will do or cause to be done all things necessary to
preserve and keep in full force and effect(i)its existence,and(ii)subject to Section 8 hereof,the Lease;(b)it has complied with all bidding and
budgeting requirements where necessary and by due notification has presented this Lease for approval and adoption as a valid obligation on its
part and that all requirements have been met and procedures have been followed to ensure the enforceability of the Lease;(c)it has sufficient
appropriations or other funds available to pay all amounts due hereunder for the current fiscal year period;(d)no event has occurred and no
condition exists which,upon the execution of this Lease or with notice or the passage of time or both,would constitute a default under any debt,
revenue or purchase obligation which it has issued or to which it is a party(the"Obligation")nor has it been in default under any Obligation at any
time during the past five(5)years,and(e)no lease,rental agreement or contract for purchase,to which Lessee has been a party,at any time
during the past five(5)years,has been terminated by Lessee as a result of insufficient funds being appropriated in any fiscal period.
6. LESSEE CERTIFICATION: Lessee warrants and covenants that(i) it is a state, or a political subdivision thereof,within the meaning of Section
103 of the Internal Revenue Code of 1986,as amended(the"Code"), and the related regulations and rulings thereunder; (ii)subject to Section 8
hereof,Lessee's obligation under this Lease constitutes an enforceable obligation issued by or on behalf of a state,or political subdivision thereof,
such that any interest income derived under this Lease and due Lessor or its Assignee,including,but not limited to,those amounts designated as
interest in Exhibit C,will not be includable in the gross income of Lessor, its Assignee or any participants with such for the purposes of federal
income taxation;(iii)this Lease represents a valid deferred payment obligation of Lessee for the amount herein set forth; (iv)Lessee has the legal
capacity to enter into this Lease and is not in contravention of any state,county,district,city or town statute,rule,regulation or other governmental
provision;(v)during the Lease Term,the Equipment will not be used in a trade or business of any other person or entity; (vi)Lessee will complete
and file on a timely basis,Internal Revenue Service form 8038G or 8038GC,as appropriate,in the manner set forth in Section 149(e)of the Code;
(vii) Lessee will not take any action or permit the omission of any action reasonably within its control which action or omission will cause the
interest portion of any Rental Payment hereunder to be includable in gross income for federal income taxation purposes.; (viii) Rental Payments
represent the fair value of the use of the respective Equipment, and that the Purchase Price represents the fair purchase price of the Equipment
and the Rental Payments do not exceed a reasonable amount so as to place the Lessee under an economic or practical compulsion to
appropriate moneys to make Rental Payments under the Lease or to exercise its option to purchase the Equipment pursuant to the Exhibit C. In
making such determinations, Lessee has given consideration to the current market value of the Equipment, the cost of acquiring the Equipment
and the option to purchase the Equipment; and (ix)the duration of the Lease Term does not exceed the weighted average useful life of the
Equipment.
7. APPROPRIATIONS AND ESSENTIAL USE: Lessee reasonably believes that sufficient funds can be obtained to make all Rental Payments
during the Lease Term. The responsible financial officer of Lessee will do all things lawfully within his or her power to obtain funds from which the
Rental Payments,including any Rental Payments required by Section 4 hereof, may be made,including making provisions for such payments,to
the extent necessary,in each proposed annual budget submitted for approval in accordance with applicable procedures of Lessee. Notwithstanding
the foregoing,the decision whether or not to budget or appropriate funds or to extend this Lease for any subsequent annual fiscal period is solely
within the discretion of the then current governing body of Lessee. It is Lessee's current intent to make the Rental Payments for the full Lease Term
if funds are legally available therefore,and in that regard Lessee represents that(a)the use of the Equipment is essential to its proper,efficient,
and economic functioning or to the services that it provides to its citizens;(b)Lessee has an immediate need for and expects to make immediate
use of substantially all the Equipment,which need is not temporary or expected to diminish in the foreseeable future;and(c)the Equipment will be
used by the Lessee only for the purpose of performing one or more of its governmental or proprietary functions consistent with the permissible
scope of its authority.
8. NONAPPROPRIATION OF FUNDS: In the event no funds or insufficient funds are appropriated and budgeted or otherwise made available for
Rental Payments, including any Rental Payments required by Section 4 hereof, for any fiscal period in which the Rental Payments for the
Equipment are due under this Lease,then,without penalty,liability or expense to Lessee,this Lease will thereafter terminate and be rendered null
and void on the last day of the fiscal period for which appropriations were made, except as to (i) the portions of the Rental Payments herein
agreed upon for which funds have been appropriated and budgeted or are otherwise available and (ii) Lessee's other obligations and liabilities
under this Lease relating to, accruing or arising prior to such termination. Lessee will, not less than sixty (60) days prior to the end of such
applicable fiscal period, in writing, notify Lessor and any Assignee of such occurrence, but failure to give such notice will not prevent such
termination. In the event of such termination,Lessee agrees to peaceably surrender possession of the Equipment to Lessor or its Assignee on the
day of such termination, packed for shipment in accordance with manufacturer's specifications and eligible for manufacturer's maintenance, and
freight prepaid and insured to any location in the continental United States designated by Lessor,all at Lessee's expense,Lessor or its Assignee
may exercise all available legal and equitable rights and remedies in retaking possession of the Equipment.
9. EXCLUSION OF WARRANTIES; LIMITATIONS OF LIABILITY; DISCLAIMER OF CONSEQUENTIAL DAMAGES: LESSEE HAS SELECTED
BOTH THE EQUIPMENT AND THE VENDOR(S) FROM WHOM LESSOR IS TO PURCHASE THE EQUIPMENT IN RELIANCE HEREON.
LESSEE ACKNOWLEDGES AND AGREES THAT THE EQUIPMENT IS OF A SIZE,DESIGN AND CAPACITY SELECTED BY LESSEE,THAT
LESSOR IS NOT A MANUFACTURER,VENDOR,DISTRIBUTOR OR LICENSOR OF SUCH EQUIPMENT,AND THAT LESSOR LEASES THE
EQUIPMENT AS IS AND HAS NOT MADE, AND DOES NOT HEREBY MAKE, ANY REPRESENTATION, WARRANTY OR COVENANT,
EXPRESS OR IMPLIED, WITH RESPECT TO THE MERCHANTABILITY, CONDITION, QUALITY, DURABILITY, DESIGN, OPERATION,
FITNESS FOR USE, OR SUITABILITY OF THE EQUIPMENT IN ANY RESPECT WHATSOEVER OR IN CONNECTION WITH OR FOR THE
PURPOSES AND USES OF LESSEE,OR ANY OTHER REPRESENTATION,WARRANTY OR COVENANT OF ANY KIND OR CHARACTER,
EXPRESS OR IMPLIED, WITH RESPECT THERETO INCLUDING ANY WARRANTIES OF TITLE OR AGAINST INFRINGEMENT OR ANY
WARRANTIES ARISING FROM A COURSE OF DEALING, USAGE OR PRACTICE, ALL OF WHICH ARE SPECIFICALLY DISCLAIMED BY
LESSOR AND IN NO EVENT SHALL LESSOR BE OBLIGATED OR LIABLE FOR ACTUAL, INCIDENTAL, CONSEQUENTIAL OR OTHER
DAMAGES OF OR TO LESSEE OR ANY OTHER PERSON OR ENTITY ARISING OUT OF OR IN CONNECTION WITH THE EQUIPMENT,
INCLUDING BUT NOT LIMITED TO THE SALE, LEASE, USE, PERFORMANCE OR MAINTENANCE OF THE EQUIPMENT, INCLUDING
INTERRUPTION OF SERVICE,LOSS OF DATA, LOSS OF REVENUE OR PROFIT,LOSS OF TIME OR BUSINESS,OR ANY SIMILAR LOSS,
EVEN IF ANY SUCH PERSON IS ADVISED IN ADVANCE OF THE POSSIBILITY OR CERTAINTY OF SUCH DAMAGES AND EVEN IF
LESSEE ASSERTS OR ESTABLISHES A FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY PROVIDED IN THIS LEASE.
Lessee acknowledges that neither the original vendor nor licensor of the Equipment (including the salespersons of any of them) is an agent of
Lessor,nor are they authorized to waive or alter any terms of this Lease. Lessee hereby waives any claim(including any claim based on strict or
absolute liability in tort)it might have against Lessor or any assignee of the Lessor for any loss,damage or expense caused by or with respect to
the Equipment. Lessor hereby assigns to Lessee during the Lease Term,to the extent permitted by law,all manufacturer's warranties,if any,that
it may have with respect to the Equipment, and Lessor authorizes Lessee to obtain the customary services furnished in connection with such
warranties at Lessee's expense. Lessor authorizes Lessee,to the extent permitted by law,to enforce in its own name any warranty,representation
or other claim enforceable against the manufacturer. Lessor assumes no responsibility for shipment,delivery,installation or maintenances,and all
claims of Lessee with respect thereto,whether for delay,damage or otherwise,will be made against the manufacturer. Lessor,at its option,may
provide in its purchase order that the manufacturer agrees that any of such claims may be made by Lessee directly against the manufacturer. The
obligation of Lessee to pay the Rental Payments as defined in Section 4 will not be abated, impaired or reduced by reason of any claims of Lessee
with respect to the Equipment,including but not limited to its condition,quality,workmanship,delivery,shipment,installation,defects or otherwise.
10. TITLE TO THE EQUIPMENT: The Equipment shall be acquired pursuant to a contract or purchase order issued by the City of Pueblo,CO, (the
"City")which contract or purchase order shall provide that legal title to the Equipment acquired thereunder be vested in Lessor, subject to the
beneficial interest of Lessee hereunder. Notwithstanding this method of acquisition, neither'The City" nor the Lessee shall be deemed to be the
"Vendor" of the equipment under this Lease pursuant to the terms of such contract or purchase order. During the Lease Term, title to the
Equipment and any and all additions, repairs, replacements or modifications thereto shall be in Lessor; provided, however,that in the event this
Lease is terminated by reason of the occurrence of an event described in Sections 3,20,or 21 hereof,title to the Equipment will be transferred to
the Lessee. In the event that the provisions of Section 20 are availed of by Lessor,or in the case of an Event of Nonappropriation as set forth in
Section 8 hereof,Lessee will surrender its interest in and possession of the Equipment to Lessor.
11. PERSONAL PROPERTY: The Equipment is,and will remain,personal property and will not be deemed to be affixed or attached to real property
or any building thereon. If requested by Lessor, Lessee will,at Lessee's expense,furnish to Lessor landlord or mortgagee waiver with respect to
the Equipment.
12. USE; REPAIRS: Lessee will use the Equipment in a careful manner for the use contemplated by the manufacturer of the Equipment and will
comply with all laws,ordinances, insurance policies and regulations relating to, and will pay all costs,claims,damages, fees and charges arising
out of, its possession, use or maintenance. Lessee, at its sole costs and expense, will maintain the Equipment according to the manufacturer's
recommended guidelines or the equivalent and meet any and all recertification requirements and will furnish proof of such maintenance, if
requested by Lessor and will furnish all needed servicing and parts,which parts will become part of the Equipment. If the Equipment is such as is
customarily covered by a maintenance agreement,Lessee will furnish Lessor with a maintenance agreement with a party satisfactory to Lessor.
13. ALTERATIONS: Lessee will not make any alterations, additions or improvements to the Equipment without Lessor's prior written consent, and
any permitted alteration or attachment which cannot be readily removed without damaging the Equipment's originally intended function or value
will become part of the Equipment.
14. LOCATION;INSPECTION: The Equipment will not be removed from, or if the Equipment consists of rolling stock,its permanent base will not be
changed from the Equipment Location without Lessor's prior written consent,which consent will not be unreasonably withheld. Lessor will be
entitled to enter upon the Equipment Location or elsewhere during reasonable business hours to inspect the Equipment or observe its use and
operations.
15. LIENS AND TAXES: Lessee will keep the Equipment free and clear of all levies,liens and encumbrances except those created under this Lease.
Lessee will pay,when due,all charges and taxes(federal,state and local)which may now or hereafter be imposed upon the ownership,leasing,
rental,sale, purchase, possession or use of the Equipment, excluding however, all taxes on or measured by Lessor's income. If Lessee fails to
pay said charges and taxes when due, Lessor will have the right, but will not be obligated, to pay said charges and taxes. If Lessor pays any
charges or taxes for which Lessee is responsible or liable under this Lease,Lessee will,upon demand,reimburse Lessor therefor.
16. RISK OF LOSS;DAMAGE;DESTRUCTION: Lessee assumes all risk of loss of or damage to the Equipment from any cause whatsoever,and no
such loss of or damage to the Equipment will relieve Lessee of the obligation to make the Rental Payments or to perform any other obligation
under this Lease. In the event of damage to any item of Equipment, Lessee will immediately place the same in good repair(the proceeds of any
insurance recovery will be applied to the cost of such repair). If Lessor determines that any item of Equipment is lost, stolen, destroyed or
damaged beyond repair, Lessee, at the option of Lessor,will (a) replace the same with like equipment in good repair; or(b)on the next Rental
Payment date pay to Lessor(i)all amounts owed by Lessee under this Lease,including the Rental Payment due on such date,and(ii)an amount
not less than the balance of the Rental Payments then remaining unpaid hereunder. In the event that Lessee is obligated to make such payment
with respect to less than all of the Equipment, Lessor will provide Lessee with the pro rata amount of the Rental Payment and the balance of the
Rental Payments then remaining unpaid hereunder, as applicable,to be made by Lessee with respect to the Equipment which has suffered the
event of loss.
17. INSURANCE: Lessee will,at its expense,maintain at all times during the Lease Term(a)fire and extended coverage,public liability and property
damage insurance with respect to the Equipment in such amounts,covering such risks,and with such insurers as will be satisfactory to Lessor. In
no event will the insurance limits be less than the greater of(i) an amount equal to the balance of the Rental Payments then remaining for the
Lease Term or(ii)any minimum required by any co-insurance provisions of such insurance,(b)liability insurance that protects Lessor from liability
in all events in form and amount satisfactory to Lessor, and (c)workers'compensation coverage as required by the laws of the state in which
Lessee is located. Each insurance policy required by clause (b) of the preceding sentence will name Lessee as an insured and Lessor or its
assigns as an additional insured and loss payee, as appropriate, and each insurance policy required by the preceding sentence will contain a
clause requiring the insurer to give Lessor or its Assignee at least thirty(30)days prior written notice of any alteration in the terms of such policy or
the cancellation thereof. The proceeds of any such policies will be payable to Lessee and Lessor or its assigns, as their interest may appear.
Upon acceptance of the Equipment and upon each insurance renewal date, Lessee will deliver to Lessor a certificate evidencing such insurance.
In the event of any loss, damage, injury or accident involving the Equipment, Lessee will promptly provide Lessor with written notice hereof and
make available to Lessor all information and documentation relating thereto. Notwithstanding the foregoing, with Lessor's prior written consent,
Lessee may self-insure against any and all risks for which insurance is required.
18. INDEMNIFICATION: To the extent permitted by law,and solely from legally available funds,Lessee agrees to indemnify Lessor against,and hold
Lessor, its Assignees, or any participants with such, harmless from, any and all claims, actions, proceedings, expenses, damages, liabilities or
losses (including, but not limited to, attorneys' fees and court costs) arising in connection with the Equipment, including, but not limited to, its
selection,purchase,delivery,possession,use,operation or return and the recovery of claims under insurance policies thereon.
19. EVENTS OF DEFAULT: The Term"Event of Default"as used in this Lease, means the occurrence of any one or more of the following events:
(a)Lessee fails to make any Rental Payment(or any other payment)as it becomes due in accordance with the terms of this Lease,and any such
failure continues for ten(10)days after the date thereof; (b) Lessee fails to perform or observe any other covenant,condition or agreement to be
performed or observed by it hereunder and such failure is not cured within ten(10)days after written notice thereof by Lessor;(c)the discovery by
Lessor that any statement,representation or warranty made by Lessee in this Lease or in any document delivered by Lessee pursuant hereto or in
connection herewith is false, misleading or erroneous in any material respect; (d) Lessee becomes insolvent, is unable to pay its debts as they
become due, makes an assignment for the benefit of creditors, applies or consents to the appointment of a receiver, trustee, conservator or
liquidator of Lessee or of all or substantial part of its assets, a petition for relief is filed by Lessee under federal bankruptcy,insolvency or similar
laws,or a petition in a proceeding under any bankruptcy,insolvency or similar laws, is filed against Lessee and is not dismissed within thirty(30)
days thereafter;(e)Lessee suffers an adverse material change in its financial condition or operations from the date hereof and,as a result,Lessor
deems itself insecure;or(f)Lessee is in default under any other agreement executed at any time with Lessor,its affiliates or Lessor's Assignee or
under any other agreement or instrument by which it is bound.
20. REMEDIES: Upon the occurrence of an Event of Default, Lessor may, at its option,exercise any one or more of the following remedies: (a)by
written notice to Lessee,declare an amount equal to all amounts then due under this Lease and all remaining Rental Payments which will become
due during the then current fiscal year of Lessee to be immediately due and payable, whereupon the same will become immediately due and
payable; (together with interest on such amount at the lesser of one and one-half(1 '/z%) percent per month or the maximum permitted by law
from the date on which Lessor has declared this Lease to be in default; (b)by written notice to Lessee,request Lessee to(and Lessee agrees that
it will), at Lessee's expense, promptly return the Equipment to Lessor in the manner set forth in Section 8 hereof, or Lessor, at its option, may
enter upon the premises where the Equipment is located and take immediate possession of and remove the same without liability to Lessor or its
agents for such entry or for damage to property or otherwise; (c) sell or lease the Equipment or sublease it for the account of Lessee, holding
Lessee liable for (i) all Rental Payments and other payments due to the effective date of such selling, leasing or subleasing, and (ii) for the
difference between the purchase price, rental and other amounts paid by the purchaser, lessee or sublessee pursuant to such sale, lease or
sublease and the remaining amounts payable by the Lessee through the end of the then current fiscal year of Lessee hereunder;and(d)exercise
any other right,remedy or privilege which may be available to it under applicable law,including the right to(i)proceed by appropriate court action
to enforce the terms of this Lease,(ii)recover damages for the breach of this Lease,and(iii)rescind this Lease as to any or all of the Equipment.
In addition, Lessee will remain liable for all covenants and indemnities under this Lease and for all legal fees and other costs and expenses,
including court costs, incurred by Lessor with respect to the enforcement of any of the remedies listed above or any other remedy available to
Lessor.
21. EARLY PURCHASE OPTION: Lessee may,upon sixty(60)days prior written notice to Lessor,and provided Lessee has fully paid and performed
all other obligations hereunder and provided no Event of Default has occurred and is continuing,pay to Lessor the applicable amount set forth on
Exhibit C attached hereto,whereupon title to the Equipment will become unconditionally vested in Lessee, and Lessor will transfer any and all of
its right, title and interest in the Equipment to Lessee as is, where is, without warranty, express or implied, except that Lessor will warrant to
Lessee that the Equipment is free and clear of any liens created by Lessor.
22. ASSIGNMENT: Except as expressly provided herein,Lessee will not(a)assign,transfer,pledge,hypothecate or grant any security interest in,or
otherwise dispose of,this Lease or the Equipment or any interest in this Lease or the Equipment or(b)sublet or lend the Equipment or permit the
Equipment to be used by anyone other than Lessee or Lessee's employees unless Lessee obtains the prior written consent of Lessor and an
opinion of nationally recognized counsel in the area of tax-exempt municipal obligations satisfactory to Lessor that such action will not adversely
affect the exclusion of the interest portions of the Rental Payments from gross income for federal income tax purposes.
Lessor,without the consent of Lessee,may assign all or any portion or portions of its right,title and interest in and to this Lease,the Equipment
and any other documents executed with respect to this Lease, and/or grant or assign all or any portion or portions of its security interest in this
Lease and the Equipment, in whole or in part to various assignees, their agents or trustees (each and any one hereinafter referred to as an
"Assignee"). Any such assignment to an Assignee may provide that the Lessor or the Assignee will act as a collection and paying agent for
owners of certificates of participation in this Lease,or may provide that a third-party trustee or agent will act as collection and paying agent for any
Assignee, provided that any such trustee or agent will maintain registration books as a register of all persons who are owners of certificates of
participation or other interest in Rental Payments and Lessee receives written notification of the name and address of the trustee or agent and a
copy of the pooling and fractionalization agency or trustee agreement, if any. Any such Assignee will have all of the assigned rights of Lessor
under this Lease. Subject to the foregoing, this Lease will inure to the benefit of and will be binding upon the heirs, executors, administrators,
successors and assigns of the parties hereto. Any assignment or reassignment of any of Lessor's right, title or interest in this Lease or the
Equipment will be effective upon receipt by Lessee of a duplicate original of the counterpart document by which the assignment or reassignment is
made, disclosing the name and address of each such Assignee and, where applicable, to whom further payments hereunder should be made.
During the Lease Term, Lessee covenants that it will keep a complete and accurate record of all assignments in form necessary to comply with
Section 149(a)of the Code and the regulations,proposed or existing,from time to time promulgated thereunder. Lessee agrees to acknowledge
in writing any assignments if so required.
Lessee agrees that, upon notice of assignment, if so instructed it will pay directly to the Assignee, or its Trustee or Agent without abatement,
deduction or setoff all amounts which become due hereunder. Lessee further agrees that it will not assert against any Assignee,Trustee or Agent
any defense, claim, counterclaim or setoff on account of any reason whatsoever with respect to any Rental Payments or other amounts due
hereunder or with respect to any action brought to obtain possession of the Equipment pursuant to this Lease.
23. FINANCIAL STATEMENTS: Each year during the term of this Lease, Lessee hereby agrees to deliver to Lessor a copy of: (i) annual audited
financial statements within one hundred twenty (120) days of Lessee's fiscal year-end; and (ii) within a reasonable period of time, any other
financial information Lessor requests from time to time.
24. NATURE OF AGREEMENT: Lessor and Lessee agree that upon the due and punctual payment and performance of the installments of Rental
Payments and other amounts and obligations under this Lease,title to the Equipment will vest permanently in Lessee as provided in this Lease,
free and clear of any interest,lien or security of Lessor therein.
25. AMENDMENTS: This Lease may be amended or any of its terms modified for the purpose of adding Equipment,with the written consent of the
parties hereto. In such event, additions to or additional exhibits attached hereto will be executed by Lessee. All other amendments or
modifications of the terms of this Lease (except for the addition or serial numbers for the Equipment as set forth in the Acceptance Certificate)
must be accomplished by written consent of Lessee and Lessor, or its Assignee, if any; provided, however,that no amendment of this Lease will
operate to reduce or delay any Rental Payments to be made hereunder without the consent of Lessor, or its Assignee, at the time of such
amendment.
26. NOTICES: All notices to be given under this Lease must be made in writing and mailed by certified mail to the other party at its address set forth
herein or at such address as the party may provide in writing from time to time. Any such notice will be deemed to have been received five(5)
days subsequent to mailing.
27. SECTION HEADINGS: All section headings contained herein are for the convenience of reference only and are not intended to define or limit the
scope of any provision of this Lease.
28. GOVERNING LAW: This agreement shall be governed by and construed in accordance with the laws of Colorado. Venue shall be proper in a
court of competent jurisdiction in Pueblo County,Colorado.
29. FURTHER ASSURANCES: Lessee will deliver to Lessor(i) an opinion of counsel in substantially the form of Exhibit D attached hereto or as
Lessor may otherwise request;and(ii)if applicable,a certificate of a duly authorized official as to designation as a qualified tax-exempt obligation.
Moreover, Lessee will execute or provide,as requested by Lessor,any documents and information that are reasonably necessary with respect to
the transaction contemplated by this Lease.
30. ENTIRE AGREEMENT: This Lease,together with the exhibits attached hereto and made a part hereof and other attachments hereto and other
documents or instruments executed by Lessee and Lessor in connection herewith, constitute the entire agreement between the parties with
respect to the lease of the Equipment,and this Lease will not be modified,amended,altered or changed except with the written consent of Lessee
or Lessor.
31. SEVERABILITY: Any provision of this Lease found to be prohibited by law will be ineffective to the extent of such prohibition without invalidating
the remainder of this Lease.
32. WAIVER: The waiver by Lessor of any breach by Lessee of any term, covenant or condition, hereof will not operate as a waiver of any
subsequent breach hereof.
33. CERTIFICATION AS TO ARBITRAGE: Lessee hereby represents as follows:
(a)The estimated total costs of the Equipment will not be less than the total principal amount of the Rental Payments.
(b)The Equipment has been ordered or is expected to be ordered within six months of the effective date of this Lease,and the Equipment
is expected to be delivered and installed,and the Vendor fully paid,within one(1)year of the effective date of this Lease.
(c) Lessee has not created or established, and does not expect to create or establish, any sinking fund or other similar fund (i) that is
reasonably expected to be used to pay the Rental Payments,or(ii)that may be used solely to prevent a default in the payment of Rental
Payments.
(d)The Equipment has not been, and is not expected to be,sold or otherwise disposed of by Lessee,either in whole or in major part,prior
to the final Rental Payment.
(e)To the best of Lessee's knowledge,information and belief,the above expectations are reasonable.
34. ELECTRONIC TRANSACTIONS: The parties agree that the transaction described herein may be conducted and related documents may be
stored by electronic means. Copies, telecopies, facsimiles, electronic files and other reproductions of original executed documents shall be
deemed to be authentic and valid counterparts of such original documents for all purposes, including the filing of any claim, action or suit in the
appropriate court of law.
ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY,EXTEND CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT
INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT,ARE NOT ENFORCEABLE. TO PROTECT YOU (LESSEE(S)AND US (LESSOR)
FROM MISUNDERSTANDING OR DISAPPOINTMENT,ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS
WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US EXCEPT AS WE MAY LATER
AGREE IN WRITING TO MODIFY IT.
BY SIGNING BELOW,YOU AND WE AGREE THAT THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN US.
LESSOR: Commerce Bank LESSEE:City of Pueblo,A Municipal Corporation
DATE: /_ /,, / DATE: /2 „� S
X 't �`-I X
Aut rized Signature and Title: Stephen G. aw. i,President of City Council
Beth M.Blumenthal
Corporate Officer.
EXHIBIT A TO
STATE& MUNICIPAL LEASE/PURCHASE AGREEMENT
Lease No. 1001112-003
Descnptlonrof Equipment; ,
r
DESCRIPTION OF LEASED EQUIPMENT(Make.Kind.Model Number.Serial Number,Any other pertinent identification)
Two(2)New Pierce Saber Medium Body Fire Pumpers with Equipment(VINs: ), $912,489.39
Two(2)New 2016 Ford Fusions(VINs: ), $39,192.00
One(1)New 2016 Ford F-150(VIN: ), $31,648.00
Emergency Lighting Equipment, $9,577.45
New Avaya IP Office Phone System and Network Infrastructure,
Data Core Upgrade and Call Management Software $548,711.00
TOTAL: $1,541,617.84
ElOCatloris -X154 ° 1 ,, / a 1 lj 'e l t
Street Address:2401 Sixth Avenue and 840 Pueblo Boulevard (Fire Pumpers); 1551 Bonforte Boulevard(Ford Fusions);425 West
Seventh Street(Ford F-150 and Emergency Lighting Equipment); and 200 South Main Street(Avaya Phone System)
City: Pueblo County: Pueblo
State:Colorado Zip Code: 81003
Lessee hereby certifies that the description of the property set forth above constitutes an accurate account of the Equipment as
referred to in the Lease.
LESSEE: Cit • -.:, ° in• ' -orporation
X a _�.- _ IA /a-ft / aotS'
Stephen . 1-..t .---,"'resident of City Council DATE
EXHIBIT B TO
STATE&MUNICIPAL LEASE/PURCHASE AGREEMENT
Lease No. 1001112-003
DELIVERY AND ACCEPTANCE CERTIFICATE
TO: Commerce Bank
Reference is made to the State and Municipal Lease/Purchase Agreement between the undersigned City of Pueblo,A Municipal
Corporation( Lessee"), and Commerce Bank("Lessor"),dated December 28,2015("Lease")and to the Equipment as such term is
defined therein. In connection therewith we are pleased to confirm to you the following:
1. All of the Equipment has been delivered to and received by the undersigned; all installation or other work necessary prior to the
use thereof has been completed;said Equipment has been examined and/or tested and is in good operating order and condition
and is in all respects satisfactory to the undersigned and as represented, and said Equipment has been accepted by the
undersigned and complies with all terms of the Lease. Consequently, you are hereby authorized to pay for the Equipment in
accordance with the terms of any purchase orders for the same.
2. In the future, in the event the Equipment fails to perform as expected or represented we will continue to honor the Lease in all
respects and continue to make our rental and other payments thereunder in the normal course of business and we will look
solely to the vendor,distributor or manufacturer for recourse.
3. We acknowledge that Lessor is neither the vendor nor manufacturer or distributor of the Equipment and has no control,
knowledge or familiarity with the condition,capacity, functioning or other characteristics of the Equipment
4. The serial number for each item of Equipment which is set forth on Exhibit A to the Lease is correct.
This certificate will not be considered to alter,construe, or amend the terms of the Lease.
LESSEE: City of Pueblo,A Municipal Corporation
X
Gina Dutcher,City Clerk
X / /
Stephen G.Nawrocki,President of City Council DATE
Federal Tax ID#: 84-6000615
EXHIBIT C
Lessee: City of Pueblo, A Municipal Corporation
Lessor: Commerce Bank
Lease Number: 1001112-003
Lease Term in
Months: Sixty(60)
Rental Periods: Annual, in Arrears
First Payment Date: 1/31/2016
Capital Cost of
Equipment: $1,541,617.84
Rental Payment Payment Amount Credited Amount Credited Outstanding
Date Amount to Interest to Capital Cost Balance
1/31/2016 268,999.05 1,948.43 267,050.62 1,274,567.22
1/31/2017 268,999.05 23,197.12 245,801.93 1,028,765.29
1/31/2018 268,999.05 18,723.53 250,275.52 778,489.77
1/31/2019 268,999.05 14,168.51 254,830.54 523,659.23
1/31/2020 268,999.05 9,530.60 259,468.45 264,190.78
1/31/2021 268.999.05 4,808.27 264,190.78 0.00
TOTALS: $1,613,994.30 $72,376.46 $1,541,617.84
Interest, if any, accruing from the Start Date to the actual date of funding shall be retained by
Lessor as additional consideration for entering into this Lease Purchase Agreement.
LESSEE: City of Pu-• • '..II-- •' :,•al Co ,• - ion
SIGNED B
NAME, TITLE: Stephen G. Nawrocki, President of City Council
• city of
iffj_ pu E • 1
LO
colorado
One City Hall Place,Third Floor Telephone:(719)562-3899
Pueblo,Colorado 81003 DEPARTMENT OF LAW Fax No.(719)544-1007
EXHIBIT D TO
STATE & MUNICIPAL LEASE/PURCHASE AGREEMENT
December 28, 2015
COMMERCE BANK
8000 Forsyth Blvd.
St. Louis, Missouri 63105
Re: State and Municipal Lease/Purchase Agreement No. 1001112-003, dated
December 28, 2015 (the "Lease"), between Commerce Bank ("Lessor") and
Pueblo, a Municipal Corporation("Lessee")
Ladies and Gentlemen:
As legal counsel to Lessee, I have examined (a) the Lease, which, among other things
provides for, at the option of the Lessee, the sale to and purchase by the Lessee of the
Equipment, (b) an executed counterpart of the ordinance or resolution of Lessee which, among
other things, authorizes Lessee to execute the Lease and (c) such other opinions, documents and
matters of law as I have deemed necessary in connection with the following opinions.
Based on the foregoing, I am of the following opinions:
1. Lessee is a public body corporate and politic, duly organized and existing under
the laws of the State, and has the following sovereign powers: (a) the power to tax, (b) the
power of eminent domain, and (c)police power.
2. Lessee has the requisite power and authority to execute and deliver the Lease and
to perform its obligations under the Lease including, at Lessee's option, the power and authority
to purchase the Equipment
3. The Lease and the other documents either attached thereto or required therein
have been duly organized, approved and executed by and on behalf of Lessee, and the Lease is a
valid and binding obligation of Lessee enforceable in accordance with its terms.
4. The authorization, approval and execution of the Lease and all other proceedings
of Lessee relating to the transactions contemplated thereby have been performed in accordance
with all open meeting laws,public bidding laws and all other applicable state and federal laws.
EXHIBIT D TO
STATE& MUNICIPAL LEASE/PURCHASE AGREEMENT
5. There is no proceeding pending or threatened in any court or before any
governmental authority or arbitration board or tribunal that, if adversely determined, would
adversely affect the transactions contemplated by the Lease or the ownership interest of Lessor
or its assigns, as the case may be, in the Equipment.
Furthermore, I confirm that the name of the Lessee as stated in the Lease, as Pueblo, a
Municipal Corporation, is the exact legal name of the Lessee for all purposes contemplated
herein.
All capitalized terms herein shall have the same meanings as in the Lease. Lessor, its
successors and assigns and any counsel rendering an opinion on the tax-exempt status of the
interest components of Rental Payments are entitled to rely on this opinion.
This opinion is rendered on the basis of the laws of the State of Colorado as enacted and
constituted on the date hereof and I disclaim any undertaking to advise you of changes which
thereafter may be brought to my attention or to the attention of the lawyers over whom I exercise
general supervision. I express no opinion as to any matter not set forth in the numbered
paragraphs herein. This opinion letter shall not be interpreted as a waiver of any rights or
protections offered to me under the Colorado Governmental Immunity Act, C.R.S. 24-10-101, et
seq., which rights and protections are expressly reserved.
Very truly yours,
->eY1"i4 4-<7 0 Va.-6" --
Daniel C. Kogovsek
City Attorney
EXHIBIT E TO
STATE& MUNICIPAL LEASE/PURCHASE AGREEMENT
Lease No. 1001112-003
I,Gina Dutcher, do hereby certify that I am the duly elected, or appointed and acting City Clerk of the City of Pueblo,A Municipal
Corporation,an agency duly organized and existing under the laws of the State of Colorado (the"Lessee"), and that the following
resolutions have been presented to and duly adopted by the ?u ebl 0 C-'1:1 4 e v u N c= L at a meeting duly and
regularly held and convened in accordance with applicable law on the .2 el day of T cP Mag 12. ,2015.
WHEREAS,the Lessee is entering a State and Municipal Lease/Purchase Agreement("Lease")dated December 28,2015,with
Commerce Bank;
WHEREAS, Lessee has carefully reviewed its financing requirements for the current calendar year and reasonably expects that it will
not issue more than ten million dollars($10,000,000)of tax-exempt obligations during the calendar year;
NOW,THEREFORE, be it RESOLVED, that the Lessee be, and hereby is, authorized to enter into the Lease with Commerce Bank
for a period of 60 months,and be it further
RESOLVED,.that the following officials of the Lessee be, and hereby are, authorized, empowered and directed to
sign on its behalf the Lease and any addenda, schedules, notes, UCC financing statements or other instruments
issued under the provision of the Lease and any other instrument or document which may be necessary or
expedient in connection with agreement upon or fulfillment of the provisions of the Lease.
Title Printed Name • •
President of City Council Stephen G. Nawrocki —�■
Director of Finance Roni Kimbrel 4�•.�-1
City Manager Sam Azad
RESOLVED, that pursuant to Section 265(b)(3)of the Internal Revenue Code of 1986, as amended,this Lease be
and hereby Is designated a"qualified tax-exempt obligation"includable within the ten million dollars($10,000,000)
of the aggregate issues designated as"qualified tax-exempt obligations"for the calendar year within which this
Lease is entered into.
RESOLVED, that Lessee shall not designate more than ten million dollars($10,000,000)of tax-exempt obligations
during the current calendar year as qualified tax-exempt obligations and Lessee,together with its subordinate
entities, does not reasonably expect to issue more than ten million dollars($10,000,000)of tax-exempt obligations
during the current calendar year.
th
IN WITNESS WHEREOF, I have duly executed this certificate and affixed the seal hereto this day o2$ of
be cerv, o ,r , 2015.
LESSEE: City of Pueblo,A Municipal Corporation
X • 111111\
Gina Dutcher`ity Clerk
STATE& MUNICIPAL LEASE/PURCHASE AGREEMENT
Lease No. 1001112-003
ESSENTIAL USE/SOURCE OF FUNDS LETTER
December 28,2015
Commerce Bank
8000 Forsyth Boulevard, Suite 510
St. Louis, Missouri 63105
Re: State and Municipal Lease/Purchase Agreement No. 1001112-003, dated December 28, 2015 (the"Lease"), between
Commerce Bank("Lessor")and the City of Pueblo,A Municipal Corporation("Lessee")
Ladies and Gentlemen:
This confirms and affirms that the Equipment described in the Lease is essential to the function of the undersigned or to the service
we provide to our citizens.
Further, we have an immediate need for, and expect to make immediate use of, substantially all such Equipment, which need is not
temporary or expected to diminish in the foreseeable future. Such Equipment will be used by us only for the purpose of performing
one or more of our governmental or proprietary functio s consi tent with the permissible scope of our authority. Specifically, such
Equipment was selected by`us to be used as follows: 1l ({2 � ��y��CPQ ��t b`v _6")v
The estimated useful life of such Equipment based upon manufacturer's representations and our projected needs is 10 -\ years.
Our source of funds for payments of the Rental Payments due under the Lease for the current fiscal year is:C1-e- `-e
We currently expect and anticipate adequate funds to be available for all future payments of rent due after the current fiscal year for
the following reasons: We (', " A MU-il,c.cti-po--C-i- r_CA- Q S�z��`ti h C 1�4=ct SI'vkc�. I q �•
Very truly yours,
LESSEE: City of Pueblo,A Municipal Corporation
Gina Dutch • I-
Stephen .Nawrocki,President of City Council DATE
Proof of Insurance
Insurance Agent Name: (J8 �t2 �1 % � / C
Agency Name: (j/`S7
Address: .3‘06 (A".1../t ,1�°7�/j 7 �d r%(,9.4 r✓e/ c Y�/
Phone Number: 3 D J -( 7 S�
E-Mail:
Ladies and Gentlemen:
Please add Commerce Bank,as both sole loss payee under the property insurance covering the equipment listed on the attached
Exhibit A and as additional insured under the general liability insurance policy. The minimum liability coverage is$1,000,000.00.
Please mail or fax an insurance certificate to:
Commerce Bank
P.O. Box 11309
St. Louis, MO 63105
Fax#314.746.3744
Please note that the Bank requires 30 day written notice of cancellation of the policy covering leased equipment.
LESSEE:Cit • e•lo,A Mun .'pal Corporation
X - — '. �� / . / o2Ot �
Step • - '" .ent of City Council DATE
Loril
merce Bank
"%oat6. Meenher FDIC
ACH Payment Authorization Form
Lease No. 1001112-003
Lessee: City of Pueblo,A Municipal Corporation
I authorize Commerce Bank ("Commerce")to initiate debit entries and to initiate, if necessary, credit entries and adjustments
for any debit entries in error on behalf of CBI Equipment Finance, Clayton Holdings or Commerce Bank as lender or lessor in
the amount shown, and from the checking or savings account with the depository institution ("Bank") named below, on the
payment due date.
Bank Name: k.K)As ���&cc o 34r.►1K ( i
� `
Address: � �t7Y"t1r` Ave_ AY\ -T n tO A 1 11 1,co
ABA Routing No.: \Oc%\ g
Account No.: CS-U 0000 ` \. XS Checking ( )Savings
This is a: W New or ( )Updated authorization form.
Annual Debit Amount: $268,999.05
Begin Auto Debit with Invoice Date Due:January 31,2016
Annual loan or lease rental payment,excluding sales tax. For leases, sales tax will be added to this amount, if applicable.
Interim or initial interest or rent and document fee will be auto debited.
Property taxes(if applicable)will not be auto debited.
The final or balloon payment,if different from the monthly payment,will not be auto debited.
I understand that this authorization will remain in full force and effect until I notify Commerce at the address or phone number
below that I wish to revoke this authorization. I understand that Commerce requires at least 5 days prior notice in order to
process any such cancellatio a
2 /2:/.20i 5�
Stephen . Nawrocki, President of City Council Date
Note that there is NO charge for this service.
Also, your"Bank" need not be Commerce to benefit from this feature. Any bank account can be auto debited. To commence
service please return this form with your document package or send this signed form and a voided check (unless
Commerce is already currently debiting this same account for another lease schedule)to:
Commerce Bank Equipment Finance Dept.
P.O. Box 11309
St. Louis, MO 63105 or
LeasingACH@Commercebank.com
To discontinue or amend service, please email the request to the address above or call Commerce Bank Equipment Finance
at 314.746.3726.
DISBURSEMENT LETTER
Date: January 6,2016
To: Commerce Bank
8000 Forsyth Boulevard, Suite 510
St. Louis, MO 63105
RE: Lease Number 1001112-003
Ladies and Gentlemen,
Please disburse the proceeds of the above lease as follows:
Wire or send to Commerce Bank Escrow Account $1,541,617.84
Total $1,541,617.84
Sincerely,
LESSEE: City o '•-•o orpor. .•n
X
Stephan G. Na,i!! • - • City Council
Lease No. 1001112-003
8038-G QUESTIONNAIRE
Name of Lessee: City of Pueblo,A Municipal Corporation
Address of Lessee: 230 S. Mechanic Street, Pueblo, CO 81003
Contact Person: Naomi Hedden, Director of Purchasing
Telephone Number: 719.553.2350
Email Address: purchasingt pueblo.us
Lessee's FEIN: 84-6000615
GENERAL
In September 2011, the Internal Revenue Service ("IRS") updated Form 8038-G (the form used by Lessees to
report the issuance of a tax-exempt obligation). The revised Form 8038-G asks specific questions about written
procedures to: (1) monitor private use of assets financed with proceeds of a tax-exempt obligation and, as
necessary, to take remedial actions to correct any violations of federal tax restrictions on the use of financed
assets; and (2) monitor the yield on the investment of gross proceeds of tax-exempt obligations and, as
necessary, make payments of arbitrage rebate earned to the United States. In addition, the revised Form 8038-
G asks Lessees to report whether any proceeds will be used to reimburse the Lessee for an expenditure paid
prior to issuance. This questionnaire is designed to obtain the information necessary to complete Form 8038-G
for the Lease. Lessee will be required to review and approve the information entered prior to signing the 8038-
G form.
At this time, the consequences of not having adopted written procedures to monitor private use of financed
assets and yield on the investment of gross proceeds of tax-exempt obligations are unknown. If you have
further questions,please consult your regular bond or legal counsel.
Part 1 -Written Tax Compliance Procedures
Note: If either of these questions is not answered, we will assume the Lessee has not adopted the described
procedures.
1. Has the Lessee established written procedures to monitor compliance with federal tax restrictions for the term of
the lease? The written procedures should identify a particular individual within Lessee's organization to monitor
compliance with the federal tax requirements related to use of the financed assets and descyibe actions to be taken in
the event failure to comply with federal tax restrictions is contemplated or discovered. Yes / No
2. Has the Lessee established written procedures to monitor the yield on the investment of proceeds of the Lease
on deposit in an escrow account or similar,f{ind prior to being spent and to ensure that any positive arbitrage rebate
earned is paid to the United States? Yes ✓✓ No_
Part 2-Reimbursement of Prior Expenditures
1. As of the funding date, were any of the proceeds of the Lease used to reimburse Lessee for
expenditures paid to acquire the financed assets prior to the funding date of the Lease? Yes_No
If yes, please attach a spreadsheet listing the expenditure(s) together with the date paid, vendor paid and
purpose of the expenditure or other proof of the expenditure(s) containing this information (i.e. invoices, receipts,
cancelled checks).
Items 2 and 3 need to be completed ONLY if the answer to item 1 above is YES.
2. Please attach a copy of Lessee's resolution of intent to finance the financed assets, which includes date of
adoption.
3. What is the amount of proceeds of the Lease reimbursed to Lessee? $
BY: Ye
NAME: Ilo►1L K� vAt t 1
TITLE: IS rt��v oK a-bl.c
DATE: lZ-ZQ- 1S`�
RESOLUTION NO. 13350
A RESOLUTION APPROVING A STATE AND MUNICIPAL
LEASE/PURCHASE AGREEMENT BETWEEN THE CITY
OF PUEBLO, A MUNICIPAL CORPORATION, AND
COMMERCE BANK, A MISSOURI BANKING
CORPORATION, AND APPROVING AN ESCROW
AGREEMENT, AUTHORIZING EXECUTION THEREOF BY
THE PRESIDENT OF THE CITY COUNCIL, AND
AUTHORIZING THE EXECUTION AND DELIVERY OF ALL
OTHER DOCUMENTS REQUIRED THEREWITH BY THE
CITY MANAGER, AND AUTHORIZING ALL OTHER ACTION
NECESSARY TO THE CONSUMMATION OF THE
TRANSACTION CONTEMPLATED BY THIS RESOLUTION
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
WHEREAS, the City of Pueblo, a Municipal Corporation (hereinafter "City"), is a
Colorado home rule city duly organized and existing under and by virtue of Article XX of
the Colorado Constitution, and is authorized thereby to purchase and lease personal
property for its municipal purposes for the benefit of City and its inhabitants and to enter
into contracts with respect thereto; and
WHEREAS, the City desires to purchase, acquire and lease certain fire apparatus
and equipment constituting personal property necessary for the performance of the Fire
Department's duties; and
WHEREAS, the City desires to purchase, acquire and lease certain equipment
necessary for the City's telephone network and voicemail system and such equipment
constitutes personal property necessary for the performance of all of the City's duties and
function; and
WHEREAS, in order to acquire such equipment, City proposes to enter into a
Lease/Purchase Agreement, including all incorporated exhibits attached thereto (the
"Agreement") with Commerce Bank, a Missouri Banking Corporation or a subsidiary
thereof(the "Lessor"), and Escrow Agreement with the Escrow Agent in substantially the
form as attached hereto; and
WHEREAS, City Council, as the governing body of the City, deems it for the benefit
of City and for the efficient and effective administration thereof to enter into the Agreement
for the purchase, acquisition and leasing of equipment therein described on the terms
and conditions therein provided; and
WHEREAS, the funds made available under the Lease will be applied to the
acquisition of the equipment in accordance with the terms of such Agreement and Escrow
Agreement; NOW, THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The form, terms and provisions of the Agreement are hereby approved in
substantially the form attached hereto with such insertions, omissions and changes as
shall be approved by the President of City Council and the City Attorney, the execution of
such documents being conclusive evidence of such approval; and the President of the
City Council is hereby authorized and directed to execute the Agreement and to deliver
the Agreement, and the City Clerk is authorized and directed to attest same and affix the
seal of the City thereto.
SECTION 2.
The City Manager is authorized and directed to take all action necessary or
reasonably required by the parties to the Agreement to carry out, give effect to and
consummate the transactions contemplated thereby(including the execution and delivery
of Acceptance Certificates, Payment Requests, any Tax Agreement and Arbitrage
Certificate, and Incumbency Certificate each with respect to the Equipment Schedule, as
contemplated in the Agreement) and to take all action necessary in conformity therewith,
including, without limitation, the execution and delivery of any closing and other
documents required to be delivered in connection with the Agreement.
SECTION 3.
The Agreement is expressly made subject to sufficient appropriations being made
therefore in each fiscal year after 2015. Nothing contained in this Resolution and the
Agreement, nor any other instrument, shall be construed with respect to the City as
incurring a pecuniary liability or charge upon the general credit of the City or against its
taxing power, nor shall the breach of any agreement contained in this Resolution and the
Agreement or any other instrument or document executed in connection therewith impose
any pecuniary liability upon the City or any charge upon its general credit or against its
taxing power, except to the extent that the rental payments payable under the Agreement
are special limited obligations of the Lessee as provided in such Agreement. Nothing in
the Agreement is intended, nor shall it be construed, to create any multiple-fiscal year
direct or indirect debt or other financial obligation whatsoever of the City.
SECTION 4.
The City Manager and Director of Finance of the City are each hereby designed to
act as authorized representatives of the City for purposes of the Agreement until such
time as the City Council shall designate any other or different authorized representative
for purposes of the Agreement.
SECTION 5.
The officers of the City are directed and authorized to perform any and all acts
consistent with the intent of this Resolution to effectuate the policies and procedures
described herein.
� � 3
.,.
SECTION 6.
This Resolution shall become effective immediately upon final passage.
INTRODUCED: December 28, 2015
1,..., 8 �1,`, )� I �~L \ Dennis Flores
`af ' f` ( � BY:
`i '/Vr. ° COUNCIL PERSON
(u"{ \� � A
-)
�- r,.-.(= -3 ' I, APPROVr D: .^"
� 1 A° PRESIDEN i�ITY COUNCIL
c� 7
ATTESTED BY: �►. _*_:: $ •
e ITY CLERK
Form 8038-G Information Return for Tax-Exempt Governmental Obligations
(Rev.September 2011) 'Under Internal Revenue Code section 149(e) OMB No.1545-0720
See separate instructions.
DepartmentInternalRevenue f the Treasury
Caution:If the issue price is under$100,000,use Form 8038-GC.
Service
Part'It Reporting Authority If Amended Return, check here ► ❑
1 Issuer's name 2 Issuer's employer identification number(EIN)
City of Pueblo,A Municipal Corporation 84-6000615
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)
230 S.Mechanic Street 13 a
6 City,town,or post office,state,and ZIP code 7 Date of issue
Pueblo,CO 81003 1/6/2016
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 10b Telephone number of officer or other
instructions) employee shown on 10a
Naomi Hedden 719.553.2350
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 ► Two Fire Pumpers,Three Fire Safety Vehicles,Phone System for IT Department 18 1,541,617. 84
19 If obligations are TANs or RANs,check only box 19a ► ❑ _ ,z
If obligations are BANs,check only box 19b ► ❑
20 If obligations are in the form of a lease or installment sale, check box ► ❑r , W :,
Part III Description of Obligations.Complete for the entire issue for which this form is being filed.
(a)Final maturity date (b)Issue price (c)Stated redemption (d)Weighted (e)Yield
price at maturity average maturity
21 1/31/2021 $ 1,541,617.84 $ NA 5 years 1.8200 %
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 VDescription 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)
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
36a 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
38a 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 ► ❑
41a If the issuer has identified a hedge,check here it. ❑ 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►
Under penalties of perjury,I declare that I have examined this return and accompanying schedules and statements,and to the best of my knowledge
Signature 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
and process this eturn,tot rson that I have authorized above.
Consent ��,�„ '< �L 12 -18- .2, 0 15" Roni Kimbrel,Director of Finance
1 Signature of issuer's authorized representative Date Type or print name and title
Paid Print/Type preparer's name i gnM� t' Dte� (T PTIN
Check ✓❑ if
Preparer
William
Mulder ( 4 self-employed P01696981
Use Only Firm's name ► William Mulder Firm's EIN ►
Firm's address ► 8000 Forsyth Boulevard,Suite 510,Saint Louis,MO 63105 Phone no. 314.746.3787
Form 8038-G(Rev.9-2011)
`YOU ISCOHQ
is i& A,L. r
c 5,
ESCROW AGREEMENT
This Escrow Agreement (the "Escrow Agreement"), dated as of December 28, 2015, and entered into
among COMMERCE BANK, a Missouri banking corporation (together with its successors and assigns, "Lessor"), the
CITY OF PUEBLO, A MUNICIPAL CORPORATION, a municipal corporation and political subdivision existing under
the laws of Colorado ("Lessee"), and THE COMMERCE TRUST COMPANY, a Missouri banking corporation, as
escrow agent(together with its successors and assigns, the"Escrow Agent").
Name of Acquisition Fund: "Pueblo III"
Amount of Deposit into the Acquisition Fund: $1,541,617.84
TERMS AND CONDITIONS
1. This Escrow Agreement relates to and is hereby made a part of the State and Municipal
Lease/Purchase Agreement dated as of December 28,2015, (the "Lease"), between Lessor and Lessee.
2. Except as otherwise defined herein,all terms defined in the Lease shall have the same meaning for
the purposes of this Escrow Agreement as in the Lease.
3. Lessor, Lessee and the Escrow Agent agree that the Escrow Agent will act as sole Escrow Agent
under the Lease and this Escrow Agreement, in accordance with the terms and conditions set forth in this Escrow
Agreement. The Escrow Agent shall not be deemed to be a party to the Lease, and this Escrow Agreement shall be
deemed to constitute the entire agreement between Lessor and Lessee and the Escrow Agent.
4. There is hereby established in the custody of the Escrow Agent a special trust fund designated as
set forth above (the "Acquisition Fund") to be held and administered by the Escrow Agent in trust for the benefit of
Lessor and Lessee in accordance with this Escrow Agreement.
5. Lessor shall deposit in the Acquisition Fund the amount specified above. Moneys held by the
Escrow Agent hereunder shall be invested and reinvested by the Escrow Agent upon written order of an authorized
Lessee representative, in accordance with the Arbitrage Instructions attached as Exhibit A, in Qualified Investments
(as defined below)maturing or subject to redemption at the option of the holder thereof prior to the date on which it is
expected that such funds will be needed. If an Authorized Lessee Representative fails to timely direct the investment
of any moneys held hereunder, the Escrow Agent shall invest and reinvest such moneys in Qualified Investments
described in 6(vi) below. Such investments shall be held by the Escrow Agent in the Acquisition Fund; any interest
and gain earned on such investments shall be deposited in the Acquisition Fund, and any losses on such investments
shall be charged to the Acquisition Fund. The Escrow Agent may act as purchaser or agent in the making or
disposing of any investment. Qualified Investments described in 6(vi) below will be subject to an annualized sweep
fee charged monthly to the earnings on monies invested.
6. "Qualified Investments" means, to the extent the same are at the time legal for investment of the
funds being invested: (i)direct general obligations of the United States of America; (ii)obligations the timely payment
of principal of and interest on which is fully and unconditionally guaranteed by the United States of America; (iii)
general obligations of the agencies and instrumentalities of the United States of America acceptable to Lessor; (iv)
certificates of deposit, time deposits or demand deposits with any bank or savings institution including the Escrow
Agent or any affiliate thereof, provided that such certificates of deposit, time deposits or demand deposits, if not
insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation, are
fully secured by obligations described in (i), (ii) or(iii) above; or(v) repurchase agreements with any state or national
bank or trust company, including the Escrow Agent or any affiliate thereof, that are secured by obligations of the type
described in (i), (ii) or(iii)above, provided that such collateral is free and clear of claims of third parties and that the
Escrow Agent or a third party acting solely as agent for the Escrow Agent has possession of such collateral and a
perfected first security interest in such collateral; or (vi) money market mutual funds that are invested in securities
described in (i), (ii) or(iii) and that are rated "Aaa"by Moody's Investors Service or"AAAm-G" by Standard & Poor's
Ratings Services or the comparable rating by Fitch IBCA, Inc.
7. Moneys in the Acquisition Fund shall be used to pay for the cost of acquisition of the Equipment
listed in the Lease. Such payment shall be made from the Acquisition Fund upon presentation to the Escrow Agent
of one or more properly executed Payment Request and Acceptance Certificates, a form of which is attached as
Exhibit B, executed by Lessee and approved by Lessor, together with an invoice for the cost of the acquisition of
said Equipment and a written approval by Lessor of the Vendor be paid. In making any disbursement pursuant to this
Section 7, the Escrow Agent may conclusively rely as to the completeness and accuracy of all statements in such
Payment Request and Acceptance Certificate, and the Escrow Agent shall not be required to make any inquiry,
inspection or investigation in connection therewith. The approval of each Payment Request and Acceptance
Certificate by the Lessor shall constitute unto the Escrow Agent an irrevocable determination by the Lessor that all
conditions precedent to the payment of the amounts set forth therein have been completed.
8. The Acquisition Fund shall terminate upon the occurrence of the earlier of(a)the presentation of a
proper Payment Request and Acceptance Certificate and the Final Acceptance Certificate, a form of which is
attached as Exhibit C, properly executed by Lessee, or(b)the presentation of written notification by the Lessor, or, if
the Lessor shall have assigned its interest under the Lease, then the assignees or subassignees of all of Lessor's
interest under the Lease or an Agent on their behalf, that the Lease has been terminated pursuant to Section 8 or 20
of the Lease. Upon termination as described in clause(a)of this paragraph, any amount remaining in the Acquisition
Fund shall be used to prepay the principal portion of Rental Payments unless Lessor directs that payment of such
amount be made in such other manner directed by Lessor that, in the opinion of nationally recognized counsel in the
area of tax-exempt municipal obligations satisfactory to Lessor, will not adversely affect the exclusion of the interest
components of Rental Payments from gross income for federal income tax purposes. If any such amount is used to
prepay principal, the Rental Payment Schedule attached to the Lease shall be revised accordingly as specified by
Lessor. Upon termination as described in clause(b)of this paragraph, any amount remaining in the Acquisition Fund
shall immediately be paid to Lessor or to any assignees or subassignees of Lessor interest in this Lease.
9. The Escrow Agent may at any time resign by giving at least 30 days written notice to Lessee and
Lessor, but such resignation shall not take effect until the appointment of a successor Escrow Agent. The
substitution of another bank or trust company to act as Escrow Agent under this Escrow Agreement may occur by
written agreement of Lessor and Lessee. In addition, the Escrow Agent may be removed at any time, with or without
cause, by an instrument in writing executed by Lessor and Lessee. In the event of any resignation or removal of the
Escrow Agent, a successor Escrow Agent shall be appointed by an instrument in writing executed by Lessor and
Lessee. Such successor Escrow Agent shall indicate its acceptance of such appointment by an instrument in writing
delivered to Lessor, Lessee and the predecessor Escrow Agent. Thereupon such successor Escrow Agent shall,
without any further act or deed, be fully vested with all the trusts, powers, rights, duties and obligations of the Escrow
Agent under this Escrow Agreement and the predecessor Escrow Agent shall deliver all moneys and securities held
by it under this Escrow Agreement to such successor Escrow Agent whereupon the duties and obligations of the
predecessor Escrow Agent shall cease and terminate. If a successor Escrow Agent has not been so appointed with
90 days of such resignation or removal, the Escrow Agent may petition a court of competent jurisdiction to have a
successor Escrow Agent appointed.
10. Any corporation or association into which the Escrow Agent may be merged or converted or with or
into which it may be consolidated, or to which it may sell or transfer its corporate trust business and assets as a
-2-
whole or substantially as a whole, or any corporation or association resulting from any merger, conversion, sale,
consolidation or transfer to which it is a party, shall be and become successor Escrow Agent hereunder and shall be
vested with all the trusts, powers, rights, obligations, duties, remedies, immunities and privileges hereunder as was its
predecessor, without the execution or filing of any instrument or any further act on the part of any of the parties
hereto.
11. The Escrow Agent incurs no responsibility to make any disbursements pursuant to the Escrow
Agreement except from funds held in the Acquisition Fund. The Escrow Agent makes no representations or
warranties as to the title to any Equipment listed in the Lease or as to the performance of any obligations of Lessor or
Lessee.
12. The Escrow Agent may act in reliance upon any writing or instrument or signature which it, in good
faith, believes to be genuine, may assume the validity and accuracy of any statement or assertion contained in such a
writing or instrument, and may assume that any person purporting to give any writing, notice, advice or instructions in
connection with the provisions hereof has been duly authorized to do so. The Escrow Agent shall not be liable in any
manner for the sufficiency or correctness as to form, manner and execution, or validity of this Escrow Agreement
other than its own execution thereof or any instrument deposited with it, nor as to the identity, authority or right of any
person executing the same; and its duties hereunder shall be limited to those specifically provided herein.
13. Unless the Escrow Agent is guilty of negligence or willful misconduct with regard to its duties
hereunder, Lessee, to the extent permitted by law, and Lessor jointly and severally hereby agree to indemnify the
Escrow Agent and hold it harmless from any and all claims, liabilities, losses, actions, suits or proceedings at law or in
equity, or any other expense, fees or charges of any character or nature, which it may incur or with which it may be
threatened by reason of its acting as Escrow Agent under this Escrow Agreement; and in connection therewith, to
indemnify the Escrow Agent against any and all expenses, including reasonable attorneys' fees and the cost of
defending any action,suit or proceeding or resisting any claim.
14. The aggregate amount of the costs,fees, and expenses of the Escrow Agent in connection with the
creation of the escrow described in and created by this Escrow Agreement and in carrying out any of the duties,
terms or provisions of this Escrow Agreement is a one time fee in the amount of $0.00 to be paid by Lessee
concurrently with the execution and delivery of this Escrow Agreement.
Notwithstanding the preceding paragraph, the Escrow Agent shall be entitled to reimbursement from Lessor
of reasonable out-of-pocket, legal or extraordinary expenses incurred in carrying out the duties, terms or provisions of
this Escrow Agreement. Claims for such reimbursement may be made to Lessor and in no event shall such
reimbursement be made from funds held by the Escrow Agent pursuant to this Escrow Agreement. The Escrow
Agent agrees that it will not assert any lien whatsoever on any of the money or Qualified Investments on deposit in
the Escrow Fund for the payment of fees and expenses for services rendered by the Escrow Agent under this Escrow
Agreement or otherwise.
15. If Lessee, Lessor or the Escrow Agent shall be in disagreement about the interpretation of the
Lease or this Escrow Agreement, or about the rights and obligations, or the propriety of any action contemplated by
the Escrow Agent hereunder, the Escrow Agent may, but shall not be required to, file an appropriate civil action to
resolve the disagreement. The Escrow Agent shall be indemnified by Lessor and Lessee, to the extent permitted by
law, for all costs, including reasonable attorneys'fees and expenses, in connection with such civil action, and shall be
fully protected in suspending all or part of its activities under this Escrow Agreement until a final judgment in such
action is received.
16. The Escrow Agent may consult with counsel of its own choice and shall have full and complete
authorization and protection for any action or non-action taken by the Escrow Agent in accordance with the opinion of
-3-
such counsel. The Escrow Agent shall otherwise not be liable for any mistakes of facts or errors of judgment, or for
any acts or omissions of any kind unless caused by its negligence or willful misconduct.
17. This Escrow Agreement shall be governed by and construed in accordance with the laws of
Colorado. Venue shall be proper in the court of the competent jurisdiction in Pueblo County, Colorado.
18. In the event any provision of this Escrow Agreement shall be held invalid or unenforceable by any
court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof.
19. This Escrow Agreement may not be amended except by a written instrument executed by Lessor,
Lessee and the Escrow Agent.
20. This Escrow Agreement may be executed in several counterparts, each of which so executed shall
be an original.
-4-
rr §
IN WITNESS WHEREOF, Lessor, Lessee and the Escrow Agent have caused this Escrow Agreement to be
executed by their duly authorized representatives.
COMMERCE BANK
LESSO �w /
!v4 /
By: - 1
Beth M.Blumenthal
Title: Corporate Officer
CITY OF PUEBLO,A MUNICIPAL CORPORATION
LESSEE
By: ___,=1411111111111.. .
Name: Stephen G. Nawrocki
Title: President of City Council
THE COMMERCE TRUST COMPANY
ESCROW AGENT
By13 �
Title:
PRESIDENT
-5-
EXHIBIT A
ARBITRAGE INSTRUCTIONS
These Arbitrage Instructions provide procedures for complying with § 148 of the Internal Revenue Code of
1986, as amended (the"Code"), in order to preserve the exclusion from federal gross income of the interest portions
of the Rental Payments under the Lease.
1. Temporary Period/Yield Restriction. Except as described in this paragraph, money in the
Acquisition Fund must not be invested at a yield greater than the yield on the Lease. Proceeds of the Lease in the
Acquisition Fund and investment earnings on such proceeds may be invested without yield restriction for three years
after the Start Date of the Lease. If any unspent proceeds remain in the Acquisition Fund after three years, such
amounts may continue to be invested without yield restriction so long as Lessee pays to the IRS all yield reduction
payments under§ 1.148-5(c)of the Treasury Regulations.
2. Opinion of Bond Counsel. These Arbitrage Instructions may be modified or amended in whole or
in part upon receipt of an opinion of nationally recognized counsel in the area of tax-exempt municipal obligations,
satisfactory to Lessor, that such modifications and amendments will not adversely affect the exclusion of the interest
components of Rental Payments from gross income for federal income tax purposes.
t }
EXHIBIT B
FORM OF PAYMENT REQUEST AND ACCEPTANCE CERTIFICATE
To: COMMERCE BANK, Lessor
THE COMMERCE TRUST COMPANY, Escrow Agent
8000 Forsyth Blvd., Suite 510
St. Louis, Missouri 63105
Re: "Pueblo III" Acquisition Fund established by the Escrow Agreement, dated as of December 28,
2015(the"Escrow Agreement")among Commerce Bank, as lessor("Lessor"), the City of Pueblo,A
Municipal Corporation ("Lessee"), and The Commerce Trust Company, as Escrow Agent (the
"Escrow Agent")
Ladies and Gentlemen:
The Escrow Agent is hereby requested to pay from the Acquisition Fund to the person or corporation
designated below as Payee, the sum set forth below in payment of a portion or all of the cost of the acquisition of the
equipment or the interest portions of Rental Payment(s) described below. The amount shown below is due and
payable under the invoice of the Payee attached hereto with respect to the cost of the acquisition of the equipment or
payment of the interest portions of Rental Payment(s)and has not formed the basis of any prior request for payment.
The equipment described below is part or all of the "Equipment" that is listed in State and Municipal
Lease/Purchase Agreement dated as of December 28,2015(the"Lease")described in the Escrow Agreement.
Equipment:
Payee:
Amount:$
Lessee hereby certifies and represents to and agrees with Lessor and the Escrow Agent as follows:
(1) The Equipment described above(a)has been delivered, installed and accepted on the date hereof,
or(b)the amount requested is a down payment currently due on said Equipment.
(2) If(1)(a)is applicable, Lessee has conducted such inspection and/or testing of said Equipment as it
deems necessary and appropriate and hereby acknowledges that it accepts said Equipment for all
purposes.
(3) If(1)(a) is applicable, Lessee is currently maintaining the insurance coverage required by Section
17 of the Lease.
Lessee hereby certifies and represents to Lessor and the Escrow Agent that no event or condition that
constitutes, or with notice or lapse of time or both would constitute, an Event of Default(as such term is defined in the
Lease)exists at the date hereof.
Dated: "Dec 21/ , 20 '1
CITY OF PUEBLO,A MUNICIPAL D&RA ION
LESSEE
By
Name: 5+e1Ledo G. NaL., ry k
Title: 1:5t- oar CA1 Co�aNc.1
APPROVED:
COMMERCE BANK
LESSOR
By:
Title:
EXHIBIT C
FINAL ACCEPTANCE CERTIFICATE
[THIS CERTIFICATE IS TO BE EXECUTED ONLY WHEN ALL EQUIPMENT
HAS BEEN ACCEPTED]
The undersigned hereby certifies that the equipment described above, together with the equipment
described in and accepted by Payment Request and Acceptance Certificates previously filed by Lessee with the
Escrow Agent and Lessor pursuant to the Escrow Agreement, constitutes all of the Equipment subject to the Lease.
Dated:
CITY OF PUEBLO,A MUNICIPAL CORPORATION
LESSEE
By:
Name:
Title: