HomeMy WebLinkAbout05674ORDINANCE NO. 5674
AN ORDINANCE CONCERNING THE FINANCING OF THE
ACQUISITION OF CERTAIN EQUIPMENT FOR PUBLIC
RECREATION PURPOSES; AUTHORIZING AND APPROVING
THE ISSUANCE OF CERTAIN CERTIFICATES OF
PARTICIPATION; AND AUTHORIZING AND APPROVING A
CONTRACT TO PURCHASE SAID EQUIPMENT, A LEASE
PURCHASE AGREEMENT, A SECURITY AND TRUST
AGREEMENT, AND OTHER RELATED DOCUMENTS AND
ACTIONS IN CONNECTION THEREWITH
WHEREAS, the City of Pueblo, Colorado (the "City "), is
authorized, pursuant to the home rule Charter of the City (the
"Charter ") to enter into lease and lease purchase agreements in
order to provide equipment for public recreation purposes; and
WHEREAS, the City Council of the City (the "City
Council ") has determined, and hereby determines, that the City
is in need of additional recreational equipment (the
"Equipment "); and
WHEREAS, the City Council has determined, and hereby
determines, that it is necessary and in the best interests of
the City and its residents that the Equipment be obtained; and
WHEREAS, for purposes of financing the acquisition of the
Equipment, the City Council has determined, and hereby
determines, that it is in the best interests of the City and its
residents that the City lease the Equipment from the City of
Pueblo, Colorado Municipal Building Corporation ( "PMBC)"
pursuant to that certain annually renewable Lease Purchase
Agreement (the "Lease "), presented to this meeting of the City
Council; and
WHEREAS, there has also been presented to this meeting of
the City Council a certain Security and Trust Agreement (the
"Agreement ") to be entered into between PMBC and The Pueblo Bank
and Trust Company, as trustee (the "Trustee "); and
WHEREAS, there has also been presented to this meeting of
the City Council a certain Resolution (the "Resolution) to be
adopted by PMBC; and
WHEREAS, Certificates of Participation (the
"Certificates ") will be sold in order to finance the acquisition
of the Equipment by PMBC.
PUEBLO: NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF
Section 1 . All action heretofore taken (not inconsistent
with the provisions of this ordinance) by the City Council or
the officers or employees of the City, directed toward
the officers or employees of the City, directed toward the
acquisition of the Equipment by the City, is hereby ratified,
approved and confirmed.
Section 2 . The City Council hereby finds and determines,
pursuant to the provisions of the Charter, that (i) acquisition
of the Equipment by PMBC pursuant to the Agreement; and (ii)
leasing the Equipment from PMBC, all under the terms and
provisions set forth in the Resolution, the Agreement and the
Lease, are necessary, convenient and in furtherance of the
governmental purposes of the City and are in the best interests
of the City; and the City Council hereby authorizes such
acquisitions of the Equipment and the leasing of it under the
terms and provisions of the Resolution, the Agreement and the
Lease.
Section 3 . The Lease, in substantially the form
presented to this meeting of the City Council and with
substantially the same content, is in all respects approved,
authorized and confirmed, and the President or Vice President of
the City Council is authorized and directed to affix his
signature to the Lease in substantially the form and with
substantially the same content as presented to this meeting of
the City Council, for and on behalf of the City, but with such
changes, modifications, additions or deletions therein as the
President of the City Council and the City Attorney shall deem
necessary, desirable or appropriate, the execution thereof to
constitute conclusive evidence of their approval of any and all
changes, modifications, additions or deletions therein from the
form and content of the Lease presented to this meeting.
Section 4 . The City Council hereby approves the
execution and delivery by PMBC and the Trustee of the Agreement,
in substantially the form and with substantially the same
content as presented to this meeting of the City Council, but
with such changes, modifications, additions or deletions therein
as the President of the City Council and the City Attorney shall
deem necessary, desirable or appropriate, the City Attorney's
release of his opinion in connection with the sale and delivery
of the Certificates to constitute conclusive evidence of such
approval.
Section 5 . The City Council hereby approves the
execution and delivery by PMBC of the Resolution, in
substantially the form and with substantially the same content
as presented to this meeting of the City Council, but with such
changes, modifications, additions or deletions therein as the
President of the City Council and the City Attorney shall deem
necessary, desirable or appropriate, the City Attorney's release
of his opinion in connection with the sale and delivery of the
Certificates to constitute conclusive evidence of such approval.
Section 6 . The City Council hereby authorizes and
consents to the issuance and sale of the Certificates pursuant
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to the Resolution. The City Council hereby authorizes and
approves the form, terms and provisions of the Certificates
contained in the Resolution, in substantially the form and with
substantially the same content as that presented to this meeting
of the City Council.
The City Council hereby authorizes, approves and directs
the sale of the Certificates in order to finance the acquisition
of the Equipment by PMBC.
Section 7 . The City Council hereby authorizes and
approves (a) the execution of the Lease by the City, (b) the
acquisition of the Equipment by PMBC pursuant to the Resolution,
and (c) the execution and delivery of any and all documents
necessary or desirable to accomplish such acquisition.
Section 8 . The City Clerk is hereby authorized and
directed to attest all signatures and acts of any official of
the City Council or the City in connection with the matters
authorized by this ordinance, and to place the seal of the City
on the Lease authorized and approved by this ordinance. The
President or Vice President of the City Council and other
officials of the City Council or the City are hereby authorized
to execute and deliver for and on behalf of the City any and all
additional certificates, documents and other papers and to
perform all other acts that they deem necessary or appropriate
in order to implement and carry out the transactions and other
matters authorized and contemplated by this ordinance.
Section 9 . NO PROVISION OF THIS ORDINANCE, THE
RESOLUTION, THE AGREEMENT, THE LEASE, OR THE CERTIFICATES SHALL
BE CONSTRUED AS CREATING OR CONSTITUTING A GENERAL OBLIGATION OR
OTHER INDEBTEDNESS OF THE CITY OR A MANDATORY PAYMENT OBLIGATION
OF THE CITY IN ANY FISCAL YEAR BEYOND A FISCAL YEAR FOR WHICH
THE CITY HAS APPROPRIATED AMOUNTS TO MAKE ANY PAYMENT WITH
RESPECT TO THE CERTIFICATES. THE CITY SHALL HAVE NO OBLIGATION
TO MAKE ANY PAYMENT WITH RESPECT TO THE CERTIFICATES EXCEPT IN
CONNECTION WITH THE PAYMENT OF THE BASE RENTALS AND ADDITIONAL
RENTALS (AS DEFINED IN THE LEASE) AND CERTAIN OTHER PAYMENTS
UNDER THE LEASE, WHICH PAYMENTS MAY BE TERMINATED BY THE CITY IN
ACCORDANCE WITH THE PROVISIONS OF THE LEASE.
Section 10 . The City Council hereby determines and
declares that the Base Rentals represent the fair value of the
use of the Equipment; and that the Purchase Option Price (as
defined in the Lease) represents the fair purchase price of the
Equipment. The City Council hereby determines and declares that
the Base Rentals do not exceed a reasonable amount so as to
place the City under an economic or practical compulsion to
renew the Lease or to exercise its option to purchase the
Equipment pursuant to the Lease. In making such determinations,
the City Council has given consideration to the value of the
Equipment, the uses and purposes for which the Equipment will be
employed by the City, the benefit to the citizens and residents
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of the City by reason of the acquisition of the Equipment and
the use of the Equipment pursuant to the terms and provisions of
the Lease, the option of the City to purchase the Equipment, and
the expected eventual vesting of the title to the Equipment in
the City. The City Council hereby determines and declares that
the acquisition of the Equipment and the leasing of the
Equipment pursuant to the Lease will result in equipment of
comparable quality and meeting the same requirements and
standards as would be necessary if the acquisition of the
Equipment were performed by the City other than pursuant to the
Lease. The City Council hereby determines and declares that the
period during which the City has an option to purchase the
Equipment (that is, the maximum term of the Lease, including all
Renewal Terms) does not exceed the useful life of the Equipment.
Section 11 . If any section, paragraph, clause or
provision of this ordinance (other than provisions as to the
payment of Base Rentals by the City during the Lease Term and
provisions for the conveyance of the Equipment to the City under
the conditions provided in the Lease) shall for any reason be
held to be invalid or unenforceable, the invalidity or
unenforcability of such section, paragraph, clause or provision
shall not affect any of the remaining provisions of this
ordinance.
Section 12 . All bylaws, orders and ordinances, or parts
thereof, inconsistent with this ordinance or with any of the
documents hereby approved, are hereby repealed only to the
extent of such inconsistency. This repealer shall not be
construed as reviving any bylaw, order or ordinance, or part
thereof.
Section 13 . This ordinance shall become effective on
final passage.
INTRODUCED March 25 , 1991
By: KENNETH HUNTER
Counci person
APPROVED:
Attest:
U
P ent, City Counci
IMI'M
C er
U
P ent, City Counci
IMI'M
APPROVED AS TO FORM BY
CITY ATTORNEY:
City Atto
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TABLE OF CONTENTS
(This Table of Contents is not a part of this Resolution
and is
only
for convenience of reference.)
Section
3.02
Creation of the Certificate Fund...........
9
Page
PREAMBLES ..................
...............................
1
ARTICLE I
9
Section
3.04
DEFINITIONS AND CONSTRUCTION
Section
1.01
Definitions
9
Section
1.02
............................
Construction
3
Section
3.06
...............................
4
Section
3.07
ARTICLE II
Section
3.08
AUTHORIZATION, TERMS, EXECUTION AND
10
10
Section
Section
3.09
3.10
ISSUANCE OF CERTIFICATES
10
Section
2.01
Authorized Amount of Certificates..........
4
Section
2.02
Issuance of Certificates ...................
5
Section
2.03
Limited Obligation... ...................
6
Section
2.04
Execution of the Certificates .............
6
Section
2.05
Validity of Certificate ....................
7
Section
2.07
Form of Certificates...... .......
7
Section
2.08
Mutilated, Lost, Stolen or Destroyed
Certificates........
7
Section
2.09
; ,,,,,,,,
Registration of Certificates Persons
Treated as Registered Owners; Transfer
and Exchange of Certificates ...............
8
Section
2.10
Cancellation of Certificates ...............
9
ARTICLE III
REVENUES AND FUNDS
Section
3.01
Source of Payment of Certificates..........
9
Section
3.02
Creation of the Certificate Fund...........
9
Section
3.03
Payments Into the Interest Account
of the Certificate Fund ....................
9
Section
3.04
Payments Into the Principal Account
of the Certificate Fund............
9
Section
3.05
Use of Moneys in the Certificate Fund......
9
Section
3.06
Custody of the Funds.. ..........
. ..
10
Section
3.07
.......
Creation of the Extradordinary
Section
3.08
Recemption Fund.. . ..........
Creation of the Acquisition Fund
10
10
Section
Section
3.09
3.10
Other Funds. . . .............
NonpresentmentofCertificates
10
Section
3.11
.............
Reports to the City from PMBC ..............
11
11
i
Section 3.12 Repayment to the City from PMBC............ 11
Section 3.13 Reports to the Trustee ..................... 11
Section 3.14 Depository of Funds ........................ 11
ARTICLE IV
REDEMPTION OF CERTIFICATES
Section
4.01
Redemption Dates and Prices ................
11
Section
4.02
Redemption Upon Termination of the Lease
17
Section
7.03
Term by Reason of Certain Events...........
12
Section
4.03
Notice of Redemption .......................
13
Section
4.04
Redemption Payments ........................
13
Section
4.05
Cancellation.... ..... .............
14
Section
4.06
Delivery of New Certificates Upon
Partial Redemption of Certificates.........
14
ARTICLE V
INVESTMENTS
Section 5.01 Investment of Money ........................ 14
Section 5.02 Arbitrage Certification .................... 15
ARTICLE VI
DISCHARGE OF OBLIGATIONS UNDER THE RESOLUTION
Section 6.01 Discharge of Obligations Under
theResolution ............................. 15
ARTICLE VII
DEFAULTS AND REMEDIES
Section
7.01
Events of Default ..........................
17
Section
7.02
Remedies on Default..... . ................
17
Section
7.03
Majority of Participants May
Control Proceedings.. . .............
18
Section
7.04
Rights and Remedies ofParticipants........
18
Section
7.05
Purchase of Equipment by Participants
or Trustee; Application of Certificates
Toward Purchase Price.. . .. ............
19
Section
7.06
Waiver of Appraisement, Valuation
Stay and Extension... . ..........
19
Section
7.07
Trustee May Enforce Rights Without
Certificates.. ... . ...................
20
Section
7.08
Delay or Omission NoWaiver................
20
Section
7.09
No Waiver of One Default to Affect
Section
7.10
Another ......... . ..... .................
Discontinuance of Proceedings on
20
Default; Position of Parties Restored......
20
Section
7.11
Waivers of Events of Default ...............
20
ii
Section 9.01 Evidence of Signature of Participants
and Ownership of Certificates .............
Section 9.02 Covenants of PMBC..... ............ ........
Section 9.03 Inspection of the Equipment ...............
Section 9.04 Parties Interest Herein.... . .....
Section 9.05 Titles, Headings, Captions, Etc...........
Section 9.06 Severability .........................
Section9.07 Governing Law ...........................
Section 9.08 Execution in Counterparts .................
Section 9.09 Notices. . �
..... ..............
Section 9.10 Payments Due onHolidays. .......
Section 9.11 Lessor, City and Trustee Representative...
TESTIMONIUM • ...... ...............................
NOTARY PUBLIC SEALS ....... ...............................
EXHIBIT A - -Form of Certificate of Participation..........
EXHIBIT B -- Description of the Equipment ..................
EXHIBIT C - -Form of Notice to Trustee pursuant
to Section 3. 13 ...............................
21
21
22
23
23
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24
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24
25
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25
25
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26
27 -28
A
B
C
iii
ARTICLE VIII
SUPPLEMENTAL RESOLUTIONS AND AMENDMENTS
OF THE LEASE
Section 8.01
Supplemental Resolutions Not Requiring
Consent of Participants
Section 8.02
....................
Supplemental Resolutions Requiring
Consent of Participants.........
Section 8.03
..
Execution of Supplemental Resolution.......
Section 8.04
Amendments, Etc. of the Lease Not
Requiring Consent of Participants..........
Section 8.05
Amendments, Etc. of the Lease Requiring
Consent of Participants
....................
ARTICLE IX
MISCELLANEOUS
Section 9.01 Evidence of Signature of Participants
and Ownership of Certificates .............
Section 9.02 Covenants of PMBC..... ............ ........
Section 9.03 Inspection of the Equipment ...............
Section 9.04 Parties Interest Herein.... . .....
Section 9.05 Titles, Headings, Captions, Etc...........
Section 9.06 Severability .........................
Section9.07 Governing Law ...........................
Section 9.08 Execution in Counterparts .................
Section 9.09 Notices. . �
..... ..............
Section 9.10 Payments Due onHolidays. .......
Section 9.11 Lessor, City and Trustee Representative...
TESTIMONIUM • ...... ...............................
NOTARY PUBLIC SEALS ....... ...............................
EXHIBIT A - -Form of Certificate of Participation..........
EXHIBIT B -- Description of the Equipment ..................
EXHIBIT C - -Form of Notice to Trustee pursuant
to Section 3. 13 ...............................
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23
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23
24
24
24
25
25
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25
25
25
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27 -28
A
B
C
iii
RESOLUTION
OF THE
CITY OF PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION
WHEREAS, the City of Pueblo, Colorado Municipal Building
Corporation ( "PMBC "), is incorporated as a nonprofit corporation
under the laws of the State of Colorado;
WHEREAS, the City of Pueblo, Colorado (the "City ") desires
PMBC to acquire certain equipment for the City (the "Equipment ")
and to finance the acquisition thereof;
WHEREAS, there has been presented to the Board of Directors
of PMBC (the "Directors ") a proposed Equipment Lease Purchase
Agreement, between the City and PMBC, to be dated May 23, 1991
(the "Lease ") and a Security and Trust Agreement (the
"Agreement ") between PMBC and The Pueblo Bank and Trust Company
as Trustee (the "Trustee ");
WHEREAS, the Lease and the Agreement provide for the
acquisition of the Equipment by PMBC, the Lease of the Equipment
to the City, and the financing of the Equipment through the
issuance of Certificates of Participation by PMBC;
WHEREAS, PMBC is willing to enter into the Lease with the
City and the Agreement with the Trustee and to do all other
things necessary and appropriate to effectuate the transactions
provided therein;
NOW, THEREFORE, the Board of Directors of the City of
Pueblo, Colorado Municipal Building Corporation hereby resolves
as follows:
1. The Directors hereby authorize the acquisition of the
Equipment identified and described in the Lease, and financing
of the Equipment upon the terms and provisions substantially as
contained in the forms of Lease and this Resolution presented to
this meeting, with such changes therein as are consistent with
this Resolution, as may be approved by the President of PMBC,
and the President and Secretary of PMBC are authorized and
directed to execute and deliver such Lease, the Agreement and
this Resolution for and on behalf of PMBC.
2. The issuance and sale of the Certificates of
Participation in the principal amount of $168,600 dated May 23,
1991 (the "Certificates ") as provided in and pursuant to the
terms of this Resolution and payable from certain payments under
the Lease is hereby authorized and approved subject to the
following:
a. the Certificates are authorized to be issued in
the maximum principal amount of $168,600;
b. the maximum number of years over which the
Certificates may mature shall be 4 years; and
C. the Certificates shall bear interest to December
1, 1994, at an interest rate of 8.0% per annum.
3. No provision of this Resolution, the Lease, the
Agreement or the Certificates, or the other documents described
herein, shall be construed as creating a general obligation or
other indebtedness of the City, nor as incurring or creating a
charge upon the general credit of the City or against its ad
valorem taxing powers; nor shall the breach of any provision
contained in any of the foregoing instruments impose any charge
upon the City's general credit or against its ad valorem taxing
powers; nor shall the Lease, this Resolution, the Agreement or
the Certificates or the other agreements, or any breach thereof,
give rise to the pecuniary liability of the City (except as
therein described), its agents, officers or employees. The City
shall have no obligation to pay out of its funds, revenues, or
amounts or to otherwise contribute any part of the cost of
making any payment with respect to the Certificates, except in
connection with payments required to be made under the Lease or
except for funds specifically pledged pursuant to the Lease,
which Lease may be terminated by the City in accordance with the
provisions thereof.
4. All proceedings, resolutions and actions of PMBC and
its officers taken in connection with the sale and issuance of
the Certificates are hereby ratified, confirmed and approved.
5. The officers of PMBC are hereby authorized and
directed to enter into such agreements and take all action
necessary or appropriate to effectuate the provisions of this
Resolution and to comply with the requirements of law, including
without limiting the generality of the foregoing:
a. the execution and delivery of such closing
certificates as may reasonably be required by Berkowitz, Brady &
Backus, P.C., Denver, Colorado, Special Counsel to PMBC relating
to (i) the tenure and identity of PMBC officials; and (ii) if in
accordance with the facts, the absence of litigation, pending or
threatened, affecting the validity of the Certificates;
b. the payment of the interest and premium, if any,
on the Certificates herein authorized, as the same shall accrue,
and the principal of said Certificates at maturity or upon prior
redemption without further warrant or order.
NOW THEREFORE, BE IT FURTHER RESOLVED BY THE BOARD OF
DIRECTORS OF THE CITY OF PUEBLO, COLORADO MUNICIPAL BUILDING
CORPORATION AS FOLLOWS:
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ARTICLE I
DEFINITIONS AND CONSTRUCTION
Section 1.01. Definitions All words and phrases defined
in Article I of the Lease shall have the same meaning in this
Resolution. In addition, the following terms, except where the
context indicates otherwise, shall have the respective meanings
set forth below.
"Deficiency" means the difference between the total amount
of principal and interest due on any Interest Payment Date for
the Certificates and the amount of Base Rentals paid by the City
and deposited in the Certificate Fund on or before such Interest
Payment Date to be used for payment of principal and interest on
the Certificates on such Interest Payment Date.
"Event of Default" means those defaults specified in
Section 7.01 of this Resolution.
"Federal Securities" means direct obligations of, or
obligations the timely payment of principal and interest of
which are fully and unconditionally guaranteed by, the United
States of America.
"Outstanding" or "Certificates Outstanding" means all
Certificates which have been executed and delivered, except:
(a) Certificates canceled or which shall have been
surrendered to the Trustee for cancellation;
(b) Certificates in lieu of which other Certificates
have been executed under Section 2.08 or 2.09 of this
Resolution;
(c) Certificates which shall have been redeemed as
provided in Article IV of this Resolution (including
Certificates redeemed on a partial payment as provided in
Section 4.02 of this Resolution); and
(d) Certificates paid or deemed to be paid in
accordance with the provisions of Article VI of this
Resolution.
"PMBC" means the City of Pueblo, Colorado Municipal
Building Corporation, a nonprofit corporation.
"Person" means natural persons, firms, associations,
corporations and public bodies.
"Rebate Fund" means the trust fund by that name which may
be created pursuant to Section 3.09 hereof.
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"Regular Record Date" means the fifteenth day (whether or
not a Business Day) next preceding each interest payment date
for the Certificates (other than a Special Record Date).
"Special Record Date" means a special date fixed to
determine the names and addresses of Registered Owners for
purposes of paying interest on a special interest payment date
for the payment of defaulted interest, all as further provided
in Section 2.02 hereof.
"Trust Estate" means the rights which are pledged and
conditionally assigned to the Trustee pursuant to this
Resolution, the Agreement and the Lease.
Section 1.02 Construction In this Resolution, unless
the context otherwise requires:
(a) Articles and Sections referred to by number shall
mean the corresponding Articles and Sections of this
Resolution.
(b) The terms "hereby," "hereof," "hereto," "herein,"
"hereunder" and any similar terms refer to this Resolution,
and the term "hereafter" shall mean after, and term
"heretofore" shall mean before, the date of execution and
delivery of this Resolution.
(c) Words of the masculine gender shall mean and
include correlative words of the female and neuter genders,
and words importing the singular number shall mean and
include the plural number and vice versa.
(d) Words importing the redemption of a Certificate
or the calling of a Certificate for redemption do not
include or connote the payment of such Certificate at its
stated maturity or the purchase of such Certificate.
(e) References in this Resolution to particular
sections of the Code, or any other legislation shall be
deemed to refer also to any successor sections thereto or
other redesignations for codification purposes and shall be
deemed to include any related Regulations.
(f) The terms "receipt," "received," "recovery,"
"recovered" and any similar terms, when used in this
Resolution with respect to moneys or payments due, shall be
deemed to refer to the passage of physical possession and
control of such moneys and payments to the Trustee.
ARTICLE II
AUTHORIZATION, TERMS, EXECUTION
AND ISSUANCE OF CERTIFICATES
Section 2.01. Authorized Amount of Certificates No
Certificates shall be issued hereunder except in accordance with
I!E,M
this Article II. The aggregate principal amount of Certificates
that may be issued shall be $168,600.
Section 2.02 Issuance of Certificates The Certificates
shall be issued in the form attached hereto as Exhibit A and
shall constitute assignments of proportionate undivided
interests in the right to receive Revenues under the Lease.
The Certificates shall be issuable solely as fully
registered Certificates without coupons in the denominations of
$1,000 and any integral multiple thereof. The Certificates
shall be lettered "R" and shall be numbered separately from 1
upward.
The Certificates shall be dated as of the date of their
authentication. The Certificates shall bear interest from May
23, 1991; provided, however, that if interest on the
Certificates shall be in default, Certificates issued in
exchange for Certificates surrendered for transfer or exchange
shall bear interest from the date to which interest has been
paid in full on the Certificates so surrendered.
The Certificates shall bear interest payable semi-
annually, on June 1 and December 1 of each year, commencing
December 1, 1991, until such Certificates are paid pursuant to
the provisions of this Resolution.
The Certificates shall mature on December 1 of the years,
and in the amounts, and shall bear interest at the rates per
annum, set forth below:
Maturity
Interest
Date
Rate
December 1)
Amount
Per Annum
1991
$37,400
8.0%
1992
40,400
8.0%
1993
43,700
8.0%
1994
47,100
8.0%
The principal of and premium, if any, on the Certificates shall
be payable to the registered owner thereof as shown on the
registration books kept by PMBC, upon presentation and surrender
thereof at the principal office of PMBC. Payment of interest on
any Certificate shall be made to the registered owner thereof by
check or draft mailed by PMBC, on or before each Interest
Payment Date (or, if such Interest Payment Date is not a
Business Day, on or before the next succeeding Business Day), to
the registered owner thereof at the address of such registered
owner shown on the registration books kept by PMBC at the close
of business on the Regular Record Date for such Interest Payment
Date; but any such interest not so timely paid or duly provided
for shall cease to be payable to the person who is the
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registered owner thereof at the close of business on the Regular
Record Date and shall be payable to the person who is the
registered owner thereof at the close of business on a Special
Record Date for the payment of any such defaulted interest.
Such Special Record Date shall be fixed by PMBC whenever moneys
become available for payment of the defaulted interest, and
notice of the Special Record Date shall be given to the
registered owners of the Certificates not less than ten days
prior thereto by first -class mail to each such registered owner
as shown on the registration books on a date selected by PMBC
stating the date of the Special Record Date and the date fixed
for the payment of such defaulted interest. PMBC may make
payments of interest on any Certificate by such alternative
means as may be mutually agreed to between the registered owner
of such Certificate and PMBC. All such payments shall be made
in lawful money of the United States of America without
deduction for the services of PMBC or the Trustee.
Section 2.03. Limited Obligation Each Certificate shall
evidence the assignment of a proportionate undivided interest in
the right to receive Revenues under the Lease. The Certificates
are payable solely from Revenues as, when and if the same are
received by PMBC. The Revenues are to be held in trust by PMBC
for such purposes in the manner and to the extent provided
herein.
NEITHER THE LEASE NOR THE CERTIFICATES CONSTITUTES A
GENERAL OBLIGATION OR OTHER INDEBTEDNESS OF THE CITY WITHIN THE
MEANING OF ANY CONSTITUTIONAL, STATUTORY OR CHARTER DEBT
LIMITATION. NEITHER THE LEASE, THE RESOLUTION NOR THE
CERTIFICATES HAVE DIRECTLY OR INDIRECTLY OBLIGATED THE CITY TO
MARE ANY PAYMENTS BEYOND THOSE APPROPRIATED FOR ANY FISCAL YEAR
IN WHICH THE LEASE SHALL BE IN EFFECT. EXCEPT TO THE EXTENT
PAYABLE FROM THE PROCEEDS OF THE SALE OF THE CERTIFICATES AND
INCOME FROM THE INVESTMENT THEREOF, FROM NET PROCEEDS OF
CONDEMNATION AWARDS, FROM NET PROCEEDS OF SUBLEASING THE
EQUIPMENT AND LEASING THE EQUIPMENT OR FROM OTHER AMOUNTS MADE
AVAILABLE UNDER THE RESOLUTION, THE CERTIFICATES WILL BE PAYABLE
DURING THE LEASE TERM SOLELY FROM BASE RENTALS TO BE PAID BY THE
CITY UNDER THE LEASE AND THE INCOME FROM CERTAIN INVESTMENTS
THEREUNDER. ALL PAYMENT OBLIGATIONS OF THE CITY UNDER THE
LEASE, INCLUDING, WITHOUT LIMITATION, THE OBLIGATION OF THE CITY
TO PAY BASE RENTALS, ARE FROM YEAR TO YEAR ONLY AND DO NOT
CONSTITUTE A MANDATORY PAYMENT OBLIGATION OF THE CITY IN ANY
FISCAL YEAR BEYOND A FISCAL YEAR IN WHICH THE LEASE SHALL BE IN
EFFECT. THE LEASE IS SUBJECT TO ANNUAL RENEWAL AT THE OPTION OF
THE CITY AND WILL BE TERMINATED UPON THE OCCURRENCE OF A
TERMINATION EVENT. IN SUCH EVENT, ALL PAYMENTS FROM THE CITY
UNDER THE LEASE WILL BE PAYABLE FROM CERTAIN MONEYS, IF ANY,
HELD BY PMBC UNDER THE RESOLUTION AND ANY MONEYS MADE AVAILABLE
BY ACTION OF THE TRUSTEE REGARDING THE EQUIPMENT.
Section 2.04. Execution of the Certificates Each
Certificate shall be executed by the manual or facsimile
so
signature of the President of PMBC, shall be attested with the
manual signature of the Secretary of PMBC and shall bear the
original or facsimile seal of PMBC. In case any official of
PMBC whose signature shall appear on the Certificates shall
cease to be such official before delivery of the Certificates,
such signature shall nevertheless be valid and sufficient for
all purposes, the same as if he or she had remained in office
until delivery.
Section 2.05. Validitv of Certificate No Certificate
shall be valid or obligatory for any purpose or entitled to any
security or benefit hereunder unless and until executed in the
manner prescribed by Section 2.04 of this Resolution, and such
execution of any Certificate shall be conclusive evidence that
such Certificate has been properly issued and delivered
hereunder.
Section 2.06. Form of Certificates The Certificates
shall be substantially in the form set forth in Exhibit A to
this Resolution, with such appropriate variations, omissions and
insertions as permitted or required hereby.
Section 2.07. Delivery of the Certificates Upon the
execution and delivery of the Agreement, PMBC shall execute and
deliver the Certificates in the aggregate principal amount of
$168,600, as hereinafter in this Section 2.07 provided.
a) Prior to the delivery by PMBC of any of the
Certificates, there shall be filed with PMBC (i) originally
executed counterparts of the Lease and the Agreement, (ii)
a certified copy of the Ordinance adopted by the City
Council approving the Lease and the issuance of the
Certificates pursuant to the Resolution; and (iii) a
certified copy of a Resolution adopted by the Board of
Directors of PMBC approving the Lease, the Agreement and
the issuance of the Certificates.
(b) PMBC shall have received evidence satisfactory to
PMBC establishing that PMBC has title or that PMBC will
receive title to the Equipment.
(c) Thereupon, PMBC shall deliver the Certificates to
the Purchasers thereof.
Section 2.08. Mutilated, Lost, Stolen or Destroyed
Certificates In the event that any Certificate is mutilated,
lost, stolen or destroyed, a new Certificate may be executed by
PMBC, of like date, maturity and denomination as that mutilated,
lost, stolen or destroyed; provided that PMBC shall have
received indemnity from the registered owner of the Certificate
satisfactory to it and provided further, in case of any
mutilated Certificate, that such mutilated Certificate shall
first be surrendered to PMBC, and in the case of any lost,
stolen or destroyed Certificate, that there shall be first
Mn
furnished to PMBC evidence of such loss, theft or destruction
satisfactory to PMBC. In the event that any such Certificate
shall have matured or is about to mature, instead of issuing a
duplicate Certificate, PMBC may pay the same without surrender
thereof. PMBC may charge the registered owner of the
Certificate with its reasonable fees and expenses in this
connection.
Section _2.09. Registration of Certific Pers
uerLi.iicares noacs for the registration and for the transfer
of Certificates shall be kept by PMBC as the registrar. Upon
surrender for transfer of a Certificate at the principal office
of PMBC, duly endorsed for transfer or accompanied by an
assignment duly executed by the registered owner or the attorney
of such registered owner duly authorized in writing, PMBC shall
execute and deliver in the name of the transferee or transferees
a new fully registered Certificate or Certificates for a like
aggregate principal amount and of a like maturity, series and
interest rate.
Certificates may be exchanged at the principal office of
PMBC for a like aggregate principal amount of Certificates of
the same date, maturity, series and interest rate, or for a like
aggregate principal amount of Certificates of other authorized
denominations of the same date, maturity, series and interest
rate. PMBC shall execute and deliver Certificates which the
registered owner thereof making the exchange is entitled to
receive, bearing numbers not then Outstanding.
PMBC shall not be required to transfer or exchange the
Certificates during the period of 15 days next preceding any
interest payment date of such Certificate nor to transfer or
exchange any Certificate after the publication or the mailing of
notice calling such Certificate for redemption has been given as
herein provided, nor during the period of 15 days next preceding
the giving of such notice of redemption.
As to any Certificate, the person in whose name the same
shall be registered on a Regular Record Date or Special Record
Date shall be deemed and regarded as the absolute owner thereof
for all purposes, and payment of either principal or interest on
the Certificate shall be made only to or upon the written order
of the registered owner thereof or the legal representative of
such registered owner, but such registration may be changed as
hereinabove provided. All such payments shall be valid and
effectual to satisfy and discharge such Certificate to the
extent of the sum or sums paid.
PMBC shall require the payment, by any Participant
requesting transfer or exchange of Certificates, of any tax, fee
or other governmental charge required to be paid with respect to
such transfer.
Section 2.10. Cancellation of Certificates Whenever any
outstanding Certificates shall be delivered to PMBC for
cancellation pursuant to this Resolution, upon payment thereof
or for or after replacement pursuant to Section 2.08 and 2.09 of
this Resolution, such Certificates shall be promptly canceled
and destroyed by PMBC.
ARTICLE III
REVENUES-AND FUNDS
Section 3.01. Source of Payment of Certificates The
Certificates shall be payable solely from Revenues received by
PMBC and do not constitute a general obligation or other
indebtedness of the City within the meaning of any
constitutional, statutory or Charter debt limitation. Revenues,
when, as and if received by PMBC, shall be held hereunder for
payment of the principal of, premium, if any, and interest on
the Certificates as provided in this Resolution.
Section 3.02. Creation of the Certificate Fund A special
fund shall be created and established by PMBC, to be designated
"City of Pueblo, Colorado, Equipment Lease Purchase Agreement,
Certificate of Participation Fund" (the "Certificate Fund "),
which shall be used to pay the principal of, premium, if any,
and interest on the Certificates. Within the Certificate Fund
there are hereby created and ordered established an Interest
Account and a Principal Account which shall be used as set forth
in Section 3.05 of this Resolution.
Section 3.03. Payments Into the Interest Account of the
Certificate Fund There shall be deposited into the Interest
Account of the Certificate Fund (a) all accrued interest and
capitalized interest, if any, received at the time of the
issuance; sale and delivery of the Certificates; (b) that
portion of each payment of Base Rentals made by the City which
is designated and paid as interest under Exhibit B to the Lease;
and (c) all other moneys received by PMBC under this Resolution
to be used for the purpose of paying interest on the
Certificates.
Section 3.04. Payments Into the Principal Account of the
Certificate Fund There shall be deposited into the Principal
Account of the Certificate Fund (a) that portion of each payment
of Base Rentals made by the City which is designated and paid as
principal under Exhibit B to the Lease; and (b) all other moneys
received by PMBC under this Resolution to be used for the
purpose of paying the principal of the Certificates.
Section 3.05. Use of Moneys in the Certificate Fund
Moneys in the Interest Account of the Certificate Fund shall be
used solely for the payment of the interest on the Certificates
except to the extent that moneys therein may be deposited in the
Rebate Fund, should such fund be established pursuant to Section
Im
3.09. Moneys in the Principal Account of the Certificate Fund
shall be used solely for the payment of the principal of the
Certificates, except to the extent that moneys therein may be
deposited in the Rebate Fund, should such a fund be established
pursuant to Section 3.09. In the event the Certificates are to
be redeemed in whole, any moneys remaining in the Certificate
Fund shall be applied to such redemption along with other moneys
held by PMBC for such purpose.
Amounts deposited into the Certificate Fund shall be
depleted at least once a year except for an amount not to exceed
the greater of one year's earnings on the Certificate Fund or
1 /12th of the annual debt service on the Certificates.
Section 3.06. Custody of the Funds All Funds created
under this Resolution shall be subject to the provisions of this
Resolution.
Section 3.07. Creation of the Extraordinary Redemption
Fund A special fund shall be created and established by PMBC
designated the "City of Pueblo, Colorado, Equipment Lease
Purchase Agreement, Extraordinary Redemption Fund" (the
"Extraordinary Redemption Fund ") into which shall be deposited
all Extraordinary Revenues and such funds as may be transferred
pursuant to Section 3.08, which are to be applied for the
redemption of the Certificates on the first Business Day for
which notice of redemption may be given. Moneys on deposit in
the Extraordinary Redemption Fund shall be disbursed for
redemption of the Certificates as provided in Section 4.01 of
this Resolution. Any income from investment of moneys in the
Extraordinary Redemption Fund and any funds remaining in the
Extraordinary Redemption Fund following a redemption of
Certificates as provided in Section 4.01 shall be deposited into
the Certificate Fund.
Section 3.08. Creation of the Acquisition Fund A special
fund shall be created and established by PMBC designated the
"City of Pueblo, Colorado Equipment Lease Purchase Agreement
Acquisition Fund" (the "Acquisition Fund ") into which shall be
deposited the net proceeds of the Certificates after payment of
all costs and fees associated with their issuance. Funds held
in the Acquisition Fund shall be used for the purchase of the
Equipment. To the extent that funds remain in the Acquisition
Fund on May 22, 1992, such funds shall be transferred to the
Extraordinary Redemption Fund. Any income from investment of
monies in the Acquisition Fund shall be deposited into the
Certificate Fund, except as provided in Section 5.01.
Section 3.09. Other Funds PMBC shall, if necessary,
establish a rebate fund for the investment of excess investment
earnings, if any, required to be paid to the United States
Treasury in respect to the Certificates ( "Rebate Fund ").
Notwithstanding any provision in this Resolution, the Agreement
or the Lease to the contrary, monies deposited into the Rebate
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Fund, if any, will not be pledged as security for the
Certificates and will not be used to pay debt service on the
Certificates. To the extent monies in the Rebate Fund are not
required for such payment, such monies shall be returned to the
City as a return of overpayment of Base Rentals upon discharge
or defeasance of the Resolution, pursuant to Article VI.
PMBC shall, if necessary, establish such other funds as it
may find necessary or convenient in order to carry out the
purposes expressed by this Resolution, the Agreement and the
Lease.
Section 3.10. Nonpresentment of Certificates In the
event any Certificate shall not be presented for payment when
due, if funds sufficient to pay such Certificate shall have been
made available to PMBC for the benefit of the registered owner
thereof, it shall be the duty of PMBC to hold such funds for a
period of six years, without liability for interest thereon, for
the benefit of the registered owner of such Certificate, who
shall be restricted exclusively to such funds for any claim of
whatever nature on his or her part under the Lease or this
Resolution or on or with respect to such Certificate. Any
unclaimed funds remaining after the expiration of the six year
period shall be returned by PMBC to the City.
Section 3.11. Reports to City Not less than once during
each calendar year, PMBC shall provide the City with an
accounting for all receipts to and disbursements from the funds
or accounts created hereunder.
Section 3.12. Repayment to the City from PMBC Upon a
discharge and a defeasance of the Resolution pursuant to Article
VI of this Resolution, any amounts remaining in the Certificate
Fund, the Extraordinary Redemption Fund, or otherwise held by
PMBC pursuant thereto shall be paid to the City as a return of
an overpayment of Base Rentals.
Section 3.13. Reports to Trustee PMBC shall notify the
Trustee on each Interest Payment Date whether it has received
and paid to the Participants sufficient Revenues to satisfy the
debt service requirements on the Certificates. The form for
said notice is attached hereto as Exhibit C.
Section 3.14. Depository of Funds All funds created
pursuant to this Resolution shall be deposited in accounts
established with the Trustee.
ARTICLE IV
REDEMPTION OF CERTIFICATES
Section 4.01. Redemption Dates and Prices The
Certificates are subject to redemption as set forth below:
(a) The Certificates shall be called for redemption on any
Interest Payment Date in the event of, and to the extent that
moneys are actually received by PMBC from the exercise by the
City of its option to purchase the Equipment, as provided in the
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Lease, upon payment of the then applicable Purchase Option
Price.
(b) The Certificates, in whole or in part, shall be
callable for redemption prior to maturity, at the option of the
City, on any Interest Payment Date.
(c) The Certificates shall be called for redemption in the
event and to the extent that Extraordinary Revenues or funds
pursuant to Section 3.08 are deposited into the Extraordinary
Redemption Fund, other than as provided in paragraph (a), (b) or
(d) or this Section.
(d) The Certificates may also be called for redemption as
set forth in Section 4.02 of this Resolution.
In the event the Certificates are redeemed pursuant to (a)
above, the Certificates shall be redeemed in whole, at par, p us
accrued interest to the redemption date.
In the event that the Certificates are redeemed pursuant to
(b) and (c) above, the Certificates shall be redeemed in whole,
or in part in inverse order of maturity and by lot within any
maturity, at par plus accrued interest to the redemption date,
on the first Business Day for which notice of redemption may be
given. When Certificates are to be redeemed in part, the
schedule of Base Rentals set forth in Exhibit B to the Lease
shall be recalculated by the Trustee.
Section 4.02. Redemution
Term by Reason of Certain Events The Certificates are callable
for redemption upon the occurrence of a Termination Event. If
the Certificates are to be redeemed subsequent to a Termination
Event as described in the preceding sentence, the Participants
shall have no right to payment from the City, the Lessor or the
Trustee, in redemption of their Certificates or otherwise,
except as expressly set forth in this Section 4.02.
Upon the occurrence of a Termination Event the Certificates
shall be payable from such moneys as may be obtained by PMBC
through the exercise of its rights under this Resolution. Upon
the occurrence of a Termination Event, PMBC may commence
proceedings for leasing the Equipment, or the sale or assignment
of PMBC's interest in the Equipment as provided in Sections 7.02
and 7.05 of this Resolution, and may call the Certificates for
redemption from and only to the extent of the Net Proceeds of
such leasing, sale or assignment of the Equipment and all other
moneys, if any, then on hand and being held by PMBC for the
Participants at 100% of the principal amount thereof plus
accrued interest to the redemption date.
In the event that such Net Proceeds of sale and other
moneys shall be insufficient to redeem the Certificates at 100%
of the principal amount thereof plus accrued interest to the
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redemption date, then such Net Proceeds of such leasing, sale or
assignment of the Equipment and other moneys shall be allocated
proportionately among the Certificates, according to the
principal amount thereof outstanding. In the event that such
Net Proceeds of such leasing, sale or assignment of the
Equipment and other moneys are in excess of the amount required
to redeem the Certificates then outstanding at 100% of the
principal amount thereof plus accrued interest to the redemption
date, after the Certificates have been redeemed, such excess
moneys shall be paid to the City. Prior to any distribution of
the Net Proceeds of such leasing, sale or assignment of the
Equipment in redemption of the Certificates pursuant to this
Section, PMBC shall be entitled to reimbursement for all costs
and expenses incurred thereby, from proceeds of such leasing,
sale or assignment. If the Certificates are to be redeemed
subsequent to a Termination Event from such Net Proceeds of such
leasing, sale or assignment of the Equipment for an amount less
than the aggregate principal amount thereof plus accrued
interest to the redemption date, no Registered Owner of any
Certificate shall have any further claim for payment against the
City, PMBC or the Trustee.
Section 4.03. Notice of Redemption Notice of the call
for any redemption, identifying the Certificates or portions
thereof to be redeemed and specifying the terms of such
redemption, shall be given by PMBC by mailing a copy of the
redemption notice by registered or certified mail at least 7
days and not more than 60 days prior to the date fixed for
redemption to the registered owner of each Certificate to be
redeemed at the address shown on the registration books;
provided, however, that failure to give such notice by mailing,
or any defect therein, shall not affect the validity of any
proceedings for the redemption of Certificates as to which no
such failure has occurred.
Any notice mailed as provided in this Section shall be
conclusively presumed to have been duly given, whether or not
the registered owner receives the notice.
If at the time of mailing of notice of redemption there
shall not have been deposited with PMBC moneys sufficient to
redeem all the Certificates called for redemption, which moneys
are or will be available for redemption of Certificates, such
notice will state that it is conditional upon the deposit of the
redemption moneys with PMBC not later than the opening of
business on the redemption date, and such notice shall be of no
effect unless such moneys are so deposited.
Section 4.04. Redemption Payments Prior to the date
fixed for redemption, funds shall be deposited with PMBC to pay,
and PMBC is hereby authorized and directed to apply such funds
to the payment of, the Certificates called, together with
accrued interest thereon to the redemption date, and any
required premium. Upon the giving of notice and the deposit of
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PMBC shall pay to the registered owners of Certificates so
redeemed, the amounts due on their respective Certificates, at
the principal office of PMBC upon presentation and surrender of
the Certificates; provided, however, that, if redeemed in part,
the Certificates may be redeemed only in multiples of $1,000.
Redemption payments shall be accompanied by a written
designation prepared by PMBC stating the portion of the payment
presenting the unpaid principal amount of the Certificate
immediately prior to the payment, the portion of the payment
representing interest, and the remaining portion, if any, which
shall be designated and paid as 'a redemption premium.
Section 4.05. Cancellation All Certificates which have
been redeemed shall not be reissued but shall be canceled and
cremated or otherwise destroyed by PMBC in accordance with
Section 2.10 hereof.
Section 4.06. Delivery of New Certificates Upon Partial
Redemption of Certificates Upon surrender and cancellation of
the Certificates for redemption in part only, a new Certificate
or Certificates of the same maturity and of authorized
denomination in an aggregate principal amount equal to the
unredeemed portion thereof, shall be executed on behalf of and
delivered by PMBC. The expenses of such execution, delivery and
exchange shall be paid by the City as Additional Rentals under
the Lease.
ARTICLE V
INVESTMENTS
Section 5.01. Investment of Moneys All moneys held as
part of the Certificate Fund, the Extraordinary Redemption Fund,
the Acquisition Fund or any other fund or account created
hereunder or under the Lease shall be deposited or invested and
reinvested by PMBC, at the direction of the City, in invest-
ments permitted for Colorado cities; provided, however, that
PMBC shall make no deposits or investments of any fund or
account created hereunder which shall interfere with or prevent
withdrawals for the payment of the Certificates at or before
maturity or interest thereon as required hereunder. All
investments and reinvestments of any amounts pursuant to this
Resolution or the Lease shall be made in compliance with the
requirements of the closing documents executed by the City in
connection with the issuance of the Certificates, unless PMBC
shall receive an opinion of nationally recognized municipal bond
counsel acceptable to the City and PMBC to the effect that an
alternate investment or reinvestment shall not adversely affect
the exclusion from gross income or alternative minimum taxable
income, for purposes of federal income taxation, of interest on
the Certificates, in which case such investment or reinvestment
shall be made in accordance with such opinion. Any and all such
deposits or investments shall be held by or under the control of
the Trustee.
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Except as may be necessary for the payment of rebate to the
United States, income from deposits or investments of moneys in
the Acquisition Fund and the Extraordinary Redemption Fund shall
be deposited into the Certificate Fund as provided in Sections
3.7 and 3.8 of this Resolution; otherwise, deposits or
investments shall at all times be a part of the fund or account
from which the moneys used to acquire such deposits or
investments shall have come, and all income and profits on such
deposits or investments shall be credited to, and losses thereon
shall be charged against, such' fund or account. In computing
the amount in any fund or account held under the provisions of
this Resolution, obligations purchased as a deposit or
investment of moneys therein shall be valued at the cost or
market price thereof, whichever is lower, exclusive of accrued
interest. With respect to all funds and accounts, valuation
shall occur annually. PMBC shall sell and reduce to cash a
sufficient amount of such deposits or investments whenever the
cash balance in any fund or account created hereunder is
insufficient to satisfy the purposes of such fund or account.
Section 5.02. Arbitrage Certification In reliance on the
direction of investments by the City as provided in Section 5.01
of this Resolution, and in reliance on the covenants of the City
in Section 11.6 of the Lease, PMBC certifies and covenants to
and for the benefit of the Participants that so long as any of
the Certificates remain outstanding, moneys in any fund or
account held by PMBC under this Resolution, whether or nor such
moneys were derived from the proceeds of the sale of the
Certificates or from any other source, will not be knowingly
deposited or invested in a manner which will cause the
Certificates to be classified as "arbitrage bonds" within the
meaning of Section 148 of the Code.
ARTICLE VI
DISCHARGE OF OBLIGATIONS UNDER THE RESOLUTION
Section 6.01. Discharge of Obligations Under the
Resolution If, when the Certificates secured hereby shall
become due and payable in accordance with their terms or
otherwise as provided in this Resolution, the whole amount of
the principal or, premium, if any, and interest due and payable
upon all of the Certificates shall be paid (or, in the case of
redemption of the Certificates pursuant to Section 4.01(d) of
this Resolution, if full or partial payment of the Certificates
and interest thereon is made as provided in Section 4.02 of this
Resolution), or provision shall have been made for the payment
of the same, together with all other sums payable hereunder,
then the right, title and interest of PMBC in and to all
covenants, agreements and other obligations of the City to PMBC
and the Participants shall thereupon cease, terminate and become
void and be discharged and satisfied. In such event, upon the
request of the City, PMBC shall transfer and convey to the City
the Equipment and PMBC shall execute such documents as may be
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reasonably be required by the City and shall turn over to the
City any surplus in any fund created under this Resolution.
All outstanding Certificates shall, prior to the maturity
or redemption date thereof, be deemed to have been paid within
the meaning and with the effect expressed in this Article VI if
(a) in case said Certificates are to be redeemed on any date
prior to their maturity, the City shall have given to PMBC in
form satisfactory to PMBC irrevocable instructions to give, on a
date in accordance with the provisions of Section 4.03 hereof,
notice of redemption of such Certificates on said redemption
date, such notice to be given in accordance with the provisions
of Section 4.03 hereof, (b) there shall have been deposited with
PMBC either moneys in an amount which shall be sufficient, or
Federal Securities which shall not contain provisions permitting
the redemption thereof at the option of the issuer thereof, the
principal of and the interest on which when due, and without any
reinvestment thereof, will provide moneys which, together with
the moneys, if any, deposited with or held by PMBC at the same
time, shall be sufficient to pay when due the principal of,
premium, if any, and interest due and to become due on said
Certificates on and prior to the redemption date or maturity
date thereof, as the case may be, and (c) in the event said
Certificates are not by their terms subject to redemption within
the next 60 days, the City shall have given PMBC in form
satisfactory to it irrevocable instructions to give, as soon as
practicable in the same manner as the notice of redemption is
given pursuant to Section 4.03 hereof, a notice to the
registered owners of such Certificates that the deposit required
by (b) above has been made with PMBC and that said Certificates
are deemed to have been paid in accordance with this Section and
stating such maturity or redemption date upon which moneys are
to be available for the payment of the principal of, premium, if
any, and interest on said Certificates. Neither the Federal
Securities nor moneys deposited with - PMBC pursuant to this
Section 6.01 or principal or interest payments on any such
Federal Securities shall be withdrawn or used for any purpose
other than, and shall be held in trust for, the payment of the
principal of, premium, if any, and interest on said
Certificates; provided any cash received from such principal or
interest payments on such Federal Securities deposited with
PMBC, if not then needed for such purpose, shall, to the extent
practicable, be reinvested in Federal Securities of the type
described in clause (b) of this paragraph maturing at the times
and in amounts sufficient to pay when due the principal of,
premium, if any, and interest to become due on said Certificates
on or prior to such redemption date or maturity date thereof, as
the case may be. At such time as any Certificates shall be
deemed paid as aforesaid, such Certificates shall no longer be
secured by or entitled to the benefits of this Resolution and
the Lease, except for the purpose of exchange and transfer and
any payment from such moneys or Federal Securities deposited
with the Trustee.
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Prior to any discharge of the obligations under this
Resolution becoming effective, the amounts required to be
deposited to discharge the obligations under this Resolution and
defease the Certificates shall be invested only in Federal
Securities.
ARTICLE VII
DEFAULTS AND REMEDIES
Section 7.01. Events of Default If any of the following
events occur it is hereby defined as and shall be deemed an
"Event of Default" under this Resolution:
(a) default by the City in the payment of Base
Rentals or Additional Rentals;
(b) The occurrence of a Termination Event; or
(c) The occurrence of an Event of Default as provided
in Section 14.1 of the Lease.
Section 7.02. Remedies on Default Upon the occurrence of
an Event of Default described in Section 7.01(b) of this
Resolution and pursuant to the Agreement, the Trustee shall
terminate the Lease Term, shall become entitled to possession of
the Equipment, and shall give notice to the City to deliver
possession of the Equipment as provided in Section 6.6 and 14.2
of the Lease, as the case may be; and the Trustee may, or as
provided in Section 7.03 of this Resolution, shall, without any
further demand or notice, take one or any combination of the
following additional remedial steps:
(a) The Trustee may lease the Equipment or any
portion thereof, all for the benefit of the Participants.
(b) The Trustee, on behalf of PMBC, may recover from
the City:
(i) the portion of Base Rentals and Additional
Rentals which would otherwise have been payable under
the Lease allocable to any period in which the City
continues to possess the Equipment; and
(ii) Base Rentals and Additional Rentals which
would otherwise have been payable by the City under
the Lease during the remainder, after the City gives
up possession of the Equipment, of the Original or
Renewal Term in which such Event of Default occurs;
provided, however, that if the Trustee does not
proceed to reposses and sell the Equipment reasonably
promptly after such Event of Default, the Trustee
shall be obligated to the City to use its best efforts
to lease the Equipment for the remainder of such
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Original or Renewal Term, as provided in paragraph (a
of this Section 7.02, and the Net Proceeds of such
leasing shall be offset against the amount recoverable
from the City under this paragraph (ii).
(c) In the event one Participant is the registered
owner of all of the Certificates, the Trustee may, and as
provided in Section 7.03 hereof, upon the written direction
of said Participant shall, convey the Equipment by bill of
sale without warranties, to said Participant.
(d) The Trustee may accelerate and declare the
principal of the Certificates due and payable at once,
without notice or demand.
(e) The Trustee may take whatever action at law or in
equity may appear necessary or desirable to enforce its
rights in and to the Equipment under the Lease and this
Resolution.
No right or remedy is intended to be exclusive of any other
rights or remedies, but each and every such right or remedy
shall be cumulative and in addition to any other remedy given
hereunder or now or hereafter existing at law or inequity or by
statute. However, notwithstanding any other provision of the
Lease or this Resolution, any and all remedies against the City
under the Lease or this Resolution shall be limited as provided
in Section 14.3 of the Lease.
Section 7.03. Majority of Participants May Control
Proceedings The registered owners of a majority in aggregate
principal amount of the Certificates then Outstanding, shall
have the right, at any time, to the extent permitted by law, by
an instrument or instruments in writing executed and delivered
to the Trustee, to direct the time, method and place of
conducting all proceedings to be taken in connection with the
enforcement of the terms and conditions of this Resolution, or
for the appointment of a receiver, and any other proceedings
hereunder; provided that such direction shall not be otherwise
than in accordance with the provisions hereof. The Trustee
shall not be required to act on any direction given to it
pursuant to this Section until the indemnity described in
Section 7(m) of the Agreement is furnished to it by such
Participants.
Section 7.04. Rights and Remedies of Participants No
Participant shall have any right to institute any suit, action
or proceeding in equity or at law for the enforcement of this
Resolution or for the execution of any trust hereof or for the
appointment of a receiver or any other remedy hereunder, unless
(a) a default has occurred of which the Trustee has been
notified as provided in Section 7(h) of the Agreement, or of
which by said Section it is deemed to have notice; Jb) such
default shall have become an Event of Default as de ined in
Section 7.01 of this Resolution; (c) the registered owners of
:W-M
not less than a majority in aggregate principal amount of
Certificates then outstanding shall have made written request to
the Trustee and shall have offered reasonable opportunity either
to proceed to exercise the powers hereinbefore granted or to
institute such action, suit or proceedings in its own name; (d)
such owners of the Certificates shall have offered to the
Trustee indemnity as provided in Section 7(m) of the Agreement;
and (e) the Trustee shall thereafter fail or refuse to exercise
the powers hereinbefore granted, or to institute such action,
suit or proceeding in its own name. The foregoing conditions
are hereby declared in every case to be conditions precedent to
the execution of the powers and trust of this Resolution, and to
any action or cause of action for the enforcement of this
Resolution, or for the appointment of a receiver or for any
other remedy hereunder; it being understood and intended that no
one or more Participants shall have any right in any manner
whatsoever to affect, disturb or prejudice the lien of this
Resolution by any action or to enforce any right hereunder
except in the manner herein provided and that all proceedings at
law or in equity shall be instituted, had and maintained in the
manner herein provided and for the benefit of the registered
owners of all Certificates then outstanding. Nothing contained
in this Resolution shall, however, affect or impair the right of
any Participant to enforce the payment of the principal of,
premium, if any, and interest on any Certificate at and after
the maturity thereof.
Section 7.05.
Trustee; Appiicazlon or Certificates Toward Purchase Price
Upon the occurrence of an Event of Default under this
Resolution, the lien on the Equipment created and vested in the
Trustee hereunder may be foreclosed either by sale at public
auction or by proceedings in equity. Upon any such sale, any
Participant or the Trustee may bid for and purchase the
Equipment and, upon compliance with the terms of sale, may hold,
retain and possess and dispose of such property in their own
absolute right without further accountability; and any purchaser
at any such sale may, if permitted by law, after allowing for
the proportion of the total purchase price required to be paid
in cash for the costs and expenses of the sale, compensation and
other charges, in paying purchase money, turn in all
Certificates then outstanding in lieu of cash, to the amount
which shall, upon distribution of the Net Proceeds of such sale,
be payable thereon. If the Trustee shall acquire title to the
Equipment as a result of any such foreclosure sale, or any
proceeding or transaction in lieu of foreclosure, the Trustee
shall thereafter sell the Equipment (except as provided in
paragraph (a) of Section 7.02 of this Resolution); and may take
any further lawful action with respect to the Equipment which
it, being advised by counsel, shall deem to be in the best
interest of the Participants, including but not limited to the
enforcement of all rights and remedies set forth in the Lease
and this Resolution and the taking of all other courses of
action permitted therein or herein.
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Section 7.06. Waiver of Appraisement, Valuation, Stay and
Extension The Lessor agrees, to the extent permitted by law,
that in case of the occurrence of an Event of Default, neither
the Lessor nor anyone claiming through or under the Lessor shall
or will set up, claim or seek to take advantage of any
appraisement, valuation, stay or extension laws now or hereafter
in force in order to prevent or hinder the enforcement or
foreclosure of this Resolution, or the absolute sale of the
Trust Estate, or the final and absolute putting into possession
thereof, immediately after such'sale, of the purchasers thereat;
and the Lessor, for itself and all who may at any time claim
through or under the Lessor, hereby waives, to the full extent
that it may lawfully do so, the benefit of all such laws, and
any and all right to have the estates comprised in the security
intended to be hereby created and marshalled upon any
foreclosure of the lien hereof and agrees that the Trustee or
any court having jurisdiction to foreclose such lien may sell
the Equipment as an entirety; provided, however, that Lessor,
for itself and all who may at any time claim through or under
the Lessor, shall retain all rights of redemption.
Section 7.07. Trustee May Enforce Rights Without
Certificates All rights of action and claims under this
Resolution or any of the Certificates outstanding hereunder may
be enforced by the Trustee without the possession of any of the
Certificates or the production thereof in any trial or
proceedings relative thereto; and any suit or proceeding
instituted by the Trustee shall be brought in its name as the
Trustee, without the necessity of joining as plaintiffs or
defendants any registered owners of the Certificates, and any
recovery of judgment shall be for the ratable benefit of the
registered owners of the Certificates, subject to the provisions
of this Resolution.
Section 7.08. Delav or Omission No Waiver No delay or
omission of the Trustee or of any Participant to exercise any
right or power accruing upon any default shall exhaust or impair
any such right or power or shall be construed to be a waiver of
any such default, or acquiescence therein; and every power and
remedy given by this Resolution may be exercised from time to
time and as often as may be deemed expedient.
Section 7.09. No Waiver of One Default to Affect Another
No waiver of any default hereunder, whether by the Trustee or
the Participants, shall extend to or affect any subsequent or
any other then existing default or shall impair any rights or
remedies consequent thereon.
Section 7.10.
rositi.on or Parties Restored In case the Trustee or the
Participants shall have proceeded to enforce any right under
this Resolution and such proceedings shall have been
discontinued or abandoned for any reason, or shall have been
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determined adversely to the Trustee or the Participants, then
and in every such case PMBC, the City, the Trustee and the
Participants shall be restored to their former positions and
rights hereunder with respect to the Trust Estate, and all
rights, remedies and powers of the Trustee, and the Participants
shall continue as if no such proceedings had been taken.
Section 7.11. Waivers of Events of Default The Trustee
may in its discretion waive any Event of Default hereunder and
its consequences, and notwithstanding anything else to the
contrary contained in this Resolution shall do so upon the
written request of the registered owners of two - thirds in
aggregate principal amount of all the Certificates the
Outstanding; provided, however, that there shall not be waived
without the consent of the registered owners of 100% of the
Certificates then Outstanding as to which the Event of Default
exists (a) any Event of Default in the payment of the principal
of or premium on any outstanding Certificates at the date of
maturity specified therein or (b) any default in the payment
when due of the interest on any such Certificates, unless prior
to such waiver or rescission, all arrears of interest and all
arrears of payments of principal and premium, if any, then due,
as the case may be, and all expenses of the Trustee in
connection with such default shall have been paid or provided
for.
ARTICLE VIII
SUPPLEMENTAL RESOLUTIONS AND
AMENDMENTS OF THE LEASE
Section 8.01. Supplemental Resolutions Not Recuiring
Consent of Participants PMBC may, with the written consent of
the City, but without the consent of or notice to the
Participants, make such Resolutions or agreements supplemental
hereto for any one or more or all of the following purposes:
(a) To add to the covenants and agreements of PMBC
contained in this Resolution other covenants and agreements
to be thereafter observed by PMBC;
(b) To cure any ambiguity, or to cure, correct or
supplement any defect or omission or inconsistent provision
contained in this Resolution or to make any provisions with
respect to matters arising under this Resolution or for any
other purpose if such provisions are necessary or desirable
and do not adversely affect the interests of the
Participants; or
(c) To subject to this Resolution additional revenues
or collateral.
Section 8.02. Supplemental Resolutions Requiring Consent
of Participants Exclusive of supplemental Resolutions covered
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by Section 8.01 hereof, the written consent of the City and the
consent of the registered owners of not less than two - thirds in
aggregate principal amount of the Certificates then Outstanding
shall be required for the execution by PMBC of any resolution or
resolutions supplemental hereto; provided, however, that without
the consent of the registered owners of all the Certificates at
the time Outstanding nothing herein contained shall permit, or
be construed as permitting:
(a) A change in the terms of redemption or maturity
of the principal amount of or the interest on any
Outstanding Certificate, or a reduction in the principal
amount of or premium payable under any redemption of any
Outstanding Certificate or the rate of interest thereon,
without the consent of the registered owner of such
Certificate;
(b) The deprivation of the registered owner of any
Certificate then Outstanding of the lien created by this
Resolution (other than as originally permitted hereby);
c) A privilege or priority of any Certificate or
Certi icates over any other Certificate or Certificates; or
(d) A reduction in the aggregate principal amount of
the Certificates required for consent to such supplemental
resolution.
If at any time the City or PMBC shall desire to make such
supplemental resolution for any of the purposes of this Section,
PMBC shall cause notice of the proposed execution of such
supplemental resolution to be mailed by registered or certified
mail to the registered owners of the Certificates then
Outstanding at the address shown on the registration books
maintained by PMBC. Such notice shall briefly set forth the
nature of the proposed supplemental resolution and shall state
that copies thereof are on file at the principal office of PMBC
for inspection by all Participants. If, within 60 days or such
longer period as shall be prescribed by the City following the
giving of such notice, the registered owners of not less than
two - thirds in aggregate principal amount of the Certificates
then outstanding at the time of the execution of any such
supplemental resolution shall have consented to and approved the
execution thereof as herein provided, no Participant shall have
any right to object to any of the terms and provisions contained
therein, or in the operation thereof, or in any manner to
question the propriety of the execution thereof, or to enjoin or
restrain the City or PMBC from executing the same or from taking
any action pursuant to the provisions thereof.
Section 8.03. Execution of Supplemental Resolution The
Trustee is authorized to loin with PMBC in the execution of any
such supplemental resolution and to make further agreements and
stipulations which may be contained therein, but the Trustee
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shall not be obligated to enter into any such supplemental
resolution which affects its rights, duties or immunities under
this Resolution. Any supplemental resolution executed in
accordance with the provisions of this Article shall thereafter
form a part of this Resolution; and all the terms and conditions
contained in any such supplemental resolution as to any
provision authorized to be contained therein shall be deemed to
be part of this Resolution for any and all purposes. In case of
the execution and delivery of any supplemental resolution,
express reference may be made thereto in the text of the
Certificates issued thereafter, if any, if deemed necessary or
desirable by PMBC.
Section 8.04. Amendments, Etc., of the Lease Not Requiring
Consent of Participants PMBC may, with the written consent of
the City, but without the consent of the or notice to the
Participants, consent to any amendment, change or modification
of the Lease as may be required (a) by the provisions of the
Lease or this Resolution, (b) for the purpose of curing any
ambiguity or formal defect or omission in the Lease, or (c) in
connection with any other change therein which, in the judgment
of PMBC, is not to the prejudice of the Participants.
Section 8.05. Amendments, Etc., of the Lease Requiring
Consent of Participants Except for the amendments, changes or
modifications permitted by Section 8.04 hereof, PMBC shall not
consent to any other amendment, change or modification of the
Lease without the giving of notice and the written approval or
consent of the registered owners of not less than two - thirds in
aggregate principal amount of the Certificates at the time
Outstanding given and procured as provided in Section 8.02
hereof. If at any time the City and PMBC shall desire any such
proposed amendment, change or modification of the Lease, PMBC
shall cause notice of such proposed amendment, change or
modification be given in the same manner as provided in
Section 8.02 hereof. Such notice shall briefly set forth the
nature of such proposed amendment, change or modification and
shall state that copies of the instrument embodying the same are
on file at the principal office of PMBC for inspection by all
Participants.
ARTICLE IX
MISCELLANEOUS
Section 9.01. Evidence of Signature of Participants and
Ownership of Certificates Any request, consent or other
instrument which this Resolution may require or permit to be
signed and executed by the Participants may be in one or more
instruments of similar tenor, and shall be signed or executed by
such Participants in person or by their attorneys appointed in
writing. Proof of the execution of any such instrument or of an
instrument appointing any such attorney, or the ownership of
Certificates shall be sufficient (except as otherwise herein
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expressly provided) if made in the following manner, but PMBC
may, nevertheless, in its discretion require further or other
proof in cases where it deems the same desirable:
(a) The fact and date of the execution by any
Participant or his or her attorney of such instrument may
be proved by the certificate of any officer authorized to
take acknowledgments in the jurisdiction in which he or she
purports to act that the person signing such request or
other instrument acknowledged to him or her the execution
thereof, or by an affidavit of a witness of such execution,
duly sworn to before a notary public.
(b) The fact of the owning by any person of
Certificates and the amounts and numbers of such
Certificates, and the date of the owning of the same, may
be proved by a certificate executed by any trust company,
bank or bankers, wherever situated, stating that at the
date thereof the party named therein did exhibit to an
officer of such trust company or bank or to such bankers,
as the property of such party, the Certificates therein
mentioned, if such certificate shall be deemed by PMBC or
the Trustee to be satisfactory. Either PMBC or the Trustee
may, in its discretion, require evidence that such
Certificates have been deposited with a bank, bankers or
trust company before taking any action based on such
ownership. In lieu of the foregoing, either PMBC or the
Trustee may accept other proofs of the foregoing, as it
shall deem appropriate.
Any request or consent of the registered owner of any
Certificate shall bind all future registered owners of such
Certificate in respect of any thing done or suffered to be done
by the City, PMBC or the Trustee, in accordance therewith.
Section 9.02. Covenants of PMBC PMBC hereby covenants to
Participants that PMBC will cooperate with the Trustee in the
enforcement of the Lease (and with all of its representations
and warranties under the Lease). PMBC agrees that wherever in
the Lease or Agreement it is stated that PMBC will notify the
Trustee, or whenever the Lease or Agreement gives the Trustee
some right or privilege or in any way attempts to confer upon
the Trustee the ability to protect the security for payment of
the Certificates, that such part of the Lease or Agreement shall
be as if it were set forth in full in this Resolution.
Section 9.03. Inspection of the Equipment PMBC and its
duly authorized agents shall have the right, on reasonable
notice to the City, at all reasonable times, to examine and
inspect the Equipment. PMBC and its duly authorized agents
shall also be permitted, at all reasonable times, to examine the
books, records, reports and other papers of the City with
respect to the Equipment.
-24-
Section 9.04. Parties Interest Herein With the exception
of rights herein expressly conferred on the City, nothing in
this Resolution expressed or implied is intended or shall be
construed to confer upon, or to give to, any person other than,
the City, PMBC, the Trustee and the Participants, any right,
remedy or claim under or by reason of this Resolution or any
covenant, condition or stipulation hereof; and all the
covenants, stipulations, promises and agreements in this
Resolution contained by and on behalf of PMBC shall be for the
sole and exclusive benefit of the City, the Lessor, the Trustee
and the Participants.
Section 9.05. Titles, Headings, Captions, Etc The
titles, captions and headings of the articles, sections and
subdivisions of this Resolution have been inserted for
convenience of reference only and shall in no way modify or
restrict any of the terms or provisions hereof.
Section 9.06. Severability In the event any provision of
this Resolution shall be held invalid or unenforceable by any
court of competent jurisdiction, such holding shall not
invalidate or render unenforceable any other provision hereof.
Section 9.07. Governing Law This Resolution shall be
governed and construed in accordance with the laws of the State
of Colorado, without regard to conflict of laws principles.
Section 9.08. Execution in Counterparts This Resolution
may be executed in several counterparts, each of which shall be
an original and all of which shall constitute but one and the
same instrument.
Section 9.09. Notices All notices, certificates or other
communications shall be sufficiently given and shall be deemed
given when delivered or mailed by certified or registered mail,
postage prepaid, as follows: if to the City, City of Pueblo,
One City Hall Place, Pueblo, Colorado 81003, Attention: City
Manager; if to PMBC, City of Pueblo, Colorado Municipal Building
Corporation, One City Hall Place, Pueblo, Colorado 81003,
Attention: President; and if to the Trustee, The Pueblo Bank
and Trust Company, 301 West Fifth Street, Pueblo, Colorado
81003, Attention: Corporate Trust Department. The City, PMBC
and the Trustee, may, by written notice, designate any further
or different addresses to which subsequent notices, certificates
or other communications shall be sent.
Section 9.10. Payments Due on Holidays If the date for
making any payment or the last day for performance of any act or
the exercising of any right, as provided in this Resolution,
shall not be a Business Day, such payment may be made or act
performed or right exercised on the next succeeding Business Day
with the same force and effect as if done on the normal date
provided in this Resolution.
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Section 9. 11. Lessor, City and Trustee Representatives
Whenever under the provisions hereof the approval of PMBC, the
City or PMBC is required, or the City, PMBC or the Trustee is
required to take some action at the request of the other, unless
otherwise provided, such approval or such request shall be given
for PMBC by a Lessor Representative, for the City by the City
Representative, and for the Trustee by the Trustee
Representative, and PMBC, the City and the Trustee shall be
authorized to act on any such approval or request.
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IN WITNESS WHEREOF, PMBC has caused this Resolution to be
executed in its corporate name and its corporate seal to be
hereto affixed and attested by their duly authorized officials
or officers, all as of the date first above written.
C SEAL l
Attest:
Sec' ary - �
CITY OF PUEBLO, COLORADO
MUNICIPAL BUILDING
CORPORATION, AS LESSOR
By:'
President
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STATE OF COLORADO )
) ss.
CITY OF PUEBLO )
The foregoing instrument was acknowledged before me as of
the 2�__rd day of 1991, by ewis A. Oui le , as
Preset of the Ci.tyof Pueblo , Co ora o Municipa —Building
Corporation, a Colorado nonprofit corporation.
WITNESS my hand and official seal.
[SEAL]
Notary Public
My commission expires:
.iy a it,�
8
ERE
STATE OF COLORADO
CITY OF PUEBLO
SS.
The foregoing instrument was acknowledged before me as of
the 23rd day of May� 1991, by Fav B. Kastel.ic
as Secretary of the city of Pueblo, Colorado Municipal Bui ing
Corporation, a Colorado nonprofit corporation.
WITNESS my hand and official seal.
: SEAL ]
My commission expires:
Aix
Notary Publ
r!
-29-
EXHIBIT A
CERTIFICATE OF PARTICIPATION
Evidencing Assignment of a
Proportionate Undivided Interest in
Rights to Receive Certain
Revenues Pursuant to the
Equipment Lease Purchase Agreement Between
CITY OF PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION,
as Lessor, and
CITY OF PUEBLO, COLORADO, as Lessee
No. R- $ 168,600
INTEREST RATE: MATURITY DATE: ORIGINAL ISSUE DATE:
8.0% December 1, 199_ May 23, 1991
REGISTERED OWNER:
PRINCIPAL SUM: DOLLARS
THIS CERTIFIES THAT THE REGISTERED OWNER (named above), or
registered assigns, has a proportionate undivided interest in
rights to receive certain revenues, as described below, pursuant
to an annually renewable Equipment Lease Purchase Agreement
dated as of May 23, 1991 (which agreement as from time to time
amended is referred to herein as the "Lease "), between CITY OF
PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION, a Colorado
nonprofit corporation, as lessor ( "PMBC") and CITY OF PUEBLO,
COLORADO (the "City "), as lessee. The interest of the
Registered Owner of this Certificate of Participation (this
"Certificate ") is secured as provided in the Lease, in
Resolution No. 1 of PMBC dated April 16, 1991, (the
"Resolution ") and the Security and Trust Agreement (the
"Agreement ") dated as of May 23, 1991, between PMBC and THE
PUEBLO BANK AND TRUST COMPANY, as trustee, or its successor (the
"Trustee ") for the Registered Owners of the Certificates (the
"Participants "), whereby certain of the rights of PMBC as lessor
under the Lease have been conditionally assigned by PMBC to the
Trustee for the benefit of the Participants. Under the
Resolution and the Agreement, PMBC has also granted to the
Trustee, for the benefit of the Participants, a security
interest in the Equipment (as hereinafter defined). Pursuant to
the Lease and the Resolution, the Registered Owner hereof is
entitled to receive, solely out of and to the extent available
from the sources hereinafter identified, on the Maturity Date
(stated above) (or earlier as hereinafter provided), the
Principal Sum (stated above), and interest thereon as described
in the Resolution at the Interest Rate (stated above) per annum
payable commencing on December 1, 1991, and semi - annually
thereafter on June 1 and December 1 of each year. Principal of
A -1
and any premium on this Certificate are payable in lawful money
of the United States of America upon presentation and surrender
thereof at the principal office of PMBC located in Pueblo,
Colorado; and interest on this Certificate is payable to the
Registered Owner hereof by check or draft of PMBC, to be mailed
to such Registered Owner, on or before each Interest Payment
Date (or, if such Interest Payment Date is not a Business Day,
as defined in the Resolution, on or before the next succeeding
it last appears in the
Business Day) , at his or her address as
registration books kept by PMBC.
REFERENCE IS MADE TO T FURTHER PROVISIONS OF THIS
CERTIFICATE PURPOSES F ON
ATTA I
THOUGH SETH S HALL FOR
FORTH HEREIN.
THIS CERTIFICATE MAY NOT BE ASSIGNED, PLEDGED, HYPOTHECATED
OR OTHERWISE TRANSFERRED OR ENCUMBERED WITHOUT THE TRANSFEREE
FIRST DELIVERING TO PMBC AND THE CITY AN EXECUTED INVESTMENT
LE REGISTERED HOLDERS HEREOF. LIVERED ON May
H REOF
This Certificate shall not be valid or become obligatory
for any purpose or be entitled to any security or benefit under
the Lease, the Resolution and the Agreement, until executed by
PMBC.
IN WITNESS WHEREOF, this Certificate has been executed with
the manual signatures of the President and Secretary of PMBC as
of the date set forth below.
Dated:
PUEBLO MUNICIPAL BUILDING
CORPORATION, as Lessor
B / A�,t
L
Y
resident
ATTEST
cZ G
Secret ry
2
ATTACHMENT I
to
CERTIFICATE OF PARTICIPATION
EVIDENCING ASSIGNMENT OF A
PROPORTIONATE UNDIVIDED INTEREST IN RIGHTS
TO RECEIVE CERTAIN REVENUES PURSUANT TO
THE EQUIPMENT
LEASE PURCHASE AGREEMENT
BETWEEN
CITY OF PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION,
AS LESSOR,
AND
CITY OF PUEBLO, COLORADO, AS LESSEE
This Certificate is one of an issue of Certificates
evidencing assignments of proportionate undivided interests in
rights to receive certain Revenues, as described below, pursuant
to the Lease and the Resolution, issued, in an aggregate
principal amount of $168,600, pursuant to the Resolution for the
purpose, among others, of providing funds to finance the
acquisition of certain public recreational equipment (the
"Equipment "), owned by PMBC and leased to the City pursuant to
the Lease.
Under the Lease, the Equipment, as defined in the Lease has
been leased by PMBC to the City; and the City has agreed to pay
directly to PMBC annual rental payments (the "Base Rentals ") in
consideration for its right to use the Equipment, the proceeds
of which are required by the Resolution to be distributed by
PMBC to the payment of the principal of, premium, if any, and
interest on the Certificates. In addition to the Base Rentals,
the City has agreed to make certain other payments (the
"Additional Rentals ") sufficient to pay the fees and expenses of
the Trustee, certain insurance premiums, taxes, and other
expenses expressly required to be paid by the City under the
Lease.
The Lease is subject to annual renewal at the option of the
City. The obligation of the City to pay Base Rentals and
Additional Rentals under the Lease will terminate in the event
that the City, for any reason, fails to budget and appropriate,
specifically with respect to the Lease, moneys to pay all Base
Rentals and reasonably estimated Additional Rentals during the
next occurring renewal term of the Lease. In the event that the
Lease Term (as defined in the Lease) is terminated by the City
as set forth above (herein referred to as an "Event of
Nonappropriation ") or is terminated by reason of an Event of
Default (as defined in the Lease), the principal amount of this
Certificate and interest hereon will be payable from such
moneys, if any, as may be available for such purpose, including
any moneys received by the Trustee from leasing, selling or
assigning its interest in the Equipment. Under certain
circumstances, this Certificate and the interest hereon may also
A -3
be payable from the Net proceeds (as defined in the Lease) and
casualty insurance policies. The Lease Term may also be
terminated in the event that the City shall exercise its option
to purchase the Equipment by making payment of the Purchase
Option Price (as defined in the Lease). In the event that the
City shall pay the Purchase Option Price, the proceeds thereof
are required to be used to pay the principal of, premium, if
any, and interest on the Certificates.
Reference is hereby made to the Lease, the Agreement and
the Resolution for a description of the rights, duties and
obligations of the City, PMBC, the Trustee and the Participants,
the terms upon which Additional Certificates may be issued, the
terms upon which the Certificates and any Additional
Certificates are secured, the terms and conditions upon which
the Certificates will be deemed to be paid at or prior to
maturity of redemption of the Certificates upon the making of
provision for the full or partial payment thereof, and the
rights of the Participants upon the occurrence of an Event of
Default or an Event of Nonappropriation.
NEITHER THE LEASE, THE RESOLUTION NOR THE CERTIFICATES
CONSTITUTES A GENERAL OBLIGATION OR OTHER INDEBTEDNESS OF THE
CITY WITHIN THE MEANING OF ANY CONSTITUTIONAL, STATUTORY OR
CHARTER DEBT LIMITATION. NEITHER THE LEASE, THE RESOLUTION NOR
THE CERTIFICATES HAVE DIRECTLY OR INDIRECTLY OBLIGATED THE CITY
TO MARE ANY PAYMENTS BEYOND THOSE APPROPRIATED FOR ANY FISCAL
YEAR IN WHICH THE LEASE SHALL BE IN EFFECT. EXCEPT TO THE
EXTENT PAYABLE FROM THE PROCEEDS OF THE SALE OF THE CERTIFICATES
AND INCOME FROM THE INVESTMENT THEREOF, FROM NET PROCEEDS OF
CERTAIN INSURANCE POLICIES, FROM NET PROCEEDS OF LEASING, SALE
OR ASSIGNMENT OF THE TRUSTEE'S INTEREST IN THE EQUIPMENT, OR
FROM OTHER AMOUNTS MADE AVAILABLE UNDER THE RESOLUTION, THIS
CERTIFICATE WILL BE PAYABLE DURING THE LEASE TERM SOLELY FROM
BASE RENTALS TO BE PAID BY THE CITY UNDER THE LEASE AND THE
INCOME FROM CERTAIN INVESTMENTS THEREUNDER. ALL PAYMENT
OBLIGATIONS OF THE CITY UNDER THE LEASE, INCLUDING, WITHOUT
LIMITATION, THE OBLIGATION OF THE CITY TO PAY BASE RENTALS, ARE
FROM YEAR TO YEAR ONLY AND DO NOT CONSTITUTE A MANDATORY PAYMENT
OBLIGATION OF THE CITY IN ANY FISCAL YEAR BEYOND A FISCAL YEAR
IN WHICH THE LEASE SHALL BE IN EFFECT. THE LEASE IS SUBJECT TO
ANNUAL RENEWAL AT THE OPTION OF THE CITY AND WILL BE TERMINATED
UPON THE OCCURRENCE OF A TERMINATION EVENT. IN SUCH EVENT, ALL
PAYMENTS FROM THE CITY UNDER THE LEASE WILL TERMINATE, AND THIS
CERTIFICATE AND THE INTEREST HEREON WILL BE PAYABLE FROM CERTAIN
MONEYS, IF ANY, HELD BY PMBC AND /OR THE TRUSTEE UNDER THE
RESOLUTION AND MONEYS MADE AVAILABLE BY ACTION OF THE TRUSTEE
PURSUANT TO THE RESOLUTION AND THE AGREEMENT REGARDING THE
EQUIPMENT. PMBC HAS NO OBLIGATION TO MAKE ANY PAYMENTS ON THE
CERTIFICATES.
The Certificates are issuable solely as fully registered
Certificates without coupons in denominations of $1,000 and any
integral multiple thereof.
A -4
This Certificate is transferable by the Registered Owner
hereof in person or by his or her attorney duly authorized in
writing on the registration books kept at the principal office
of PMBC upon surrender of this Certificate together with a duly
executed written instrument of transfer satisfactory to PMBC.
Upon such transfer, a new fully registered Certificate or
Certificates of the same maturity, of authorized denomination or
denominations, for the same aggregate principal amount, will be
issued to the transferee in exchange herefor, all upon payment
of the charges and subject to the terms and conditions set forth
in the Resolution. PMBC may deem and treat the person in whose
name this Certificate is registered as the absolute owner
hereof, whether or not this Certificate shall be overdue, for
the purpose of receiving payment and for all other purposes, and
neither the City nor PMBC shall be affected by any notice to the
contrary.
Certificates may be exchanged at the principal office of
PMBC for a like aggregate principal amount of Certificates of
the same date, maturity, series and interest rate, or for a like
aggregate principal amount of Certificates of other authorized
denominations of the same date, maturity, series and interest
rate. PMBC shall execute and deliver Certificates which the
registered owner thereof making the exchange is entitled to
receive, bearing numbers not then Outstanding.
PMBC shall not be required to transfer or exchange the
Certificates during the period of 15 days next preceding any
Interest Payment Date of such Certificate nor to transfer or
exchange any Certificate after the publication or the mailing of
notice calling such Certificate for redemption has been given as
herein provided, nor during the period of 15 days preceding the
giving of such notice of redemption.
In the event that this Certificate is called for redemption
in part only, upon surrender and cancellation of this
Certificate, a new fully registered Certificate or Certificates
of the same maturity, of authorized denomination, in an
aggregate principal amount equal to the unredeemed portion
hereof, shall be executed and delivered by PMBC to the
Registered Owner hereof.
The Certificates are subject to redemption as follows:
(a) The Certificates shall be called for redemption
on any Interest Payment Date in the event of, and to the
extent that moneys are actually received by PMBC from the
exercise by the City of its option to purchase the
Equipment, as provided in the Lease, upon payment of the
then applicable Purchase Option Price.
(b) The Certificates, in whole or in part, shall be
callable for redemption prior to maturity, at the option of
the City, on any Interest Payment Date.
A -5
wp m
(c) The Certificates shall be called for redemption
in the event and only to the extent that any Extraordinary
Revenues (as defined in the Lease) or funds remaining in
the Acquisition Fund on May 22, 1992 are deposited into the
Extraordinary Redemption Fund, other than as provided in
(a) or (b) above or in (d) below.
(d) The Certificates may also be called for
redemption as set forth below upon the occurrence of a
Termination Event.
In the event the Certificates are redeemed pursuant to (a)
above, the Certificates shall be redeemed in whole at par, plus
accrued interest to the redemption date.
In the event that the Certificates are redeemed pursuant to
(b) and (c) above, the Certificates shall be redeemed in whole,
or in part in inverse order of maturity and by lot within any
maturity, selected in such a manner as PMBC shall determine, at
a redemption price at par plus accrued interest to the
redemption date, on the first Business Day for which notice of
redemption may be given. If the Certificates are redeemed in
part and less than all of the Certificates of a single maturity
are to be redeemed, PMBC shall select Certificates of such
maturity for redemption, by lot in such manner as PMBC shall
determine.
Upon the occurrence of a Termination Event (as defined in
the Resolution), the Certificates shall be payable from such
moneys as may be obtained by the Trustee through the exercise of
its rights under the Agreement and the Resolution. Upon the
occurrence of a Termination Event, the Trustee may commence
proceedings for subleasing the Equipment or the sale or
assignment of the Trustee's interest in the Equipment as
provided in the Agreement and the Resolution, and may call the
Certificates for redemption from the Net Proceeds of such
subleasing, sale or assignment of the Equipment and all other
moneys, if any, then on hand and being held by the Trustee for
the Participants, subject to the provisions of the Resolution
and Agreement at 100% of the principal amount thereof plus
accrued interest to the redemption date. In the event that such
Net Proceeds and other moneys are insufficient to redeem the
Certificates at 100% of the principal amount thereof plus
accrued interest to the redemption date, such Net Proceeds and
other moneys shall be allocated proportionately among the
Certificates, according to the principal amount thereof
Outstanding. In the event that such Net Proceeds and other
moneys are in excess of the amount required to redeem the
Certificates at 100% of the principal amount thereof plus
accrued interest to the redemption date, then such excess moneys
shall be paid to the City. Prior to any distribution of such
Net Proceeds in redemption of the Certificates, the Trustee
shall be entitled to payment of its customary fees for all
services rendered in connection with such liquidation, as well
A -6
as reimbursement for all costs and expenses incurred thereby
from the proceeds of such foreclosure and sale. A PARTICIPANT
SHOULD NOT ANTICIPATE THAT IT WILL BE POSSIBLE TO REPOSSESS ON
AND SELL THE EQUIPMENT FOR AN AMOUNT EQUAL TO THE AGGREGATE
PRINCIPAL AMOUNT OF THE CERTIFICATES THEN OUTSTANDING PLUS
ACCRUED INTEREST THEREON. IF THE CERTIFICATES ARE REDEEMED
SUBSEQUENT TO THE OCCURRENCE OF A TERMINATION EVENT FOR AN
AMOUNT LESS THAN THE AGGREGATE PRINCIPAL AMOUNT THEREOF PLUS
ACCRUED INTEREST TO THE REDEMPTION DATE, NO REGISTERED OWNER OF
ANY CERTIFICATE SHALL HAVE ANY FURTHER CLAIM FOR PAYMENT AGAINST
THE CITY, PMBC OR THE TRUSTEE.
In the event any of the Certificates are called for
redemption as aforesaid, PMBC shall cause notice of the call for
redemption, identifying the Certificates or portions thereof to
be redeemed, to be given by mailing, at least 7 days and not
more than 60 days prior to the redemption date, as provided in
the Resolution. All Certificates so called for redemption shall
cease to bear interest after the specified redemption date,
provided that such funds as may be available for their
redemption pursuant to the Lease (which, in the case of a
Termination Event, as defined in the Resolution, may be less
than the full principal amount of the Outstanding Certificates
and accrued interest thereon to the redemption date) are on
deposit at the place of payment at that time.
PMBC shall pay to the Registered Owners of Certificates to
be redeemed, or their representatives duly authorized in
writing, the amounts due on their respective Certificates at the
principal office of PMBC; provided, however, that, if redeemed
in part, the Certificates may only be redeemed in multiples of
$1,000. Redemption payments shall be accompanied by a written
designation prepared by PMBC stating the portion of the payment
representing the unpaid principal amount of each Certificate
immediately prior to the payment, the portion representing
interest and the remaining portion, if any, which shall be
designated and paid as a redemption premium.
The Trustee may waive an Event of Nonappropriation or an
Event of Default under certain circumstances as provided in the
Lease, the Agreement and the Resolution.
The Resolution permits amendments thereto and to the Lease,
upon the agreement of the City and PMBC, and compliance with the
other requirements of the Resolution, including but not limited
to, in certain cases the approval of the Registered Owners of
not less than two - thirds or, for certain amendments, 100% in
aggregate principal amount of the Certificates at the time
Outstanding, as defined in the Lease. The Lease also contains
provisions permitting the City and PMBC to enter into amendments
to the Resolution and the Lease without the consent of the
Registered Owners of the Certificates for certain purposes. The
Resolution requires the written consent of the Trustee to any
amendment of the Resolution, the Agreement or the Lease which
modifies the rights, duties or immunities of the Trustee.
A -7
Any consent or request by the Registered Owner of this
Certificate shall be conclusive and binding upon such owner and
upon all future Registered Owners of this Certificate and of any
Certificate issued upon the transfer of this Certificate whether
or not notation of such consent or request is made upon this
Certificate.
This Certificate is issued with the intent that the laws of
the State of Colorado shall govern its legality, validity,
enforceability and construction.
Mfl
(Form of Transfer)
FOR VALUE RECEIVED the undersigned hereby sells, assigns
and transfers unto
(Please Insert Social Security or the
Identifying N er ol Transferee)
(Please Print or Type Name and A ress o
Transferee) t e within Certificate and all rights thereunder,
and hereby irrevocably constitutes and appoints
attorney to transfer the within Certificate
on the oo s ept for registration thereof, with full power of
substitution in the premises.
Dated:
Signature Guaranteed:
NOTICE: Signature(s) must
be guaranteed by a member
firm of the New York Stock
Exchange or a commercial
bank or trust company.
NOTICE: The signature to
this assignment must
correspond with the name as
it appears upon the face of
the within Certificate in
every particular without
alteration or enlargement
or any change whatever.
TRANSFER FEE MAY BE REQUIRED
A -9
EXHIBIT B
60 - 1991 Hyundai Gas Cars with these features:
Executive Suntop, Sweater Baskets,
Full Wheel Covers, Fleet Number Decals,
Optional Pin Stripe and Placement of Your
Logo on Car, 3 Year Parts and Labor Warranty
with 24 -Hour Guarantee.
10 - New Tires and Wheels
2 - 3/4 inch Discharge Tenaka Sump Pumps
Service manuals, adequate supply of spark plugs, air
cleaners, and a familiarization seminar to your
people.
NOTE: The above is subject to revision as additional
information is received (including but not limited to Serial
Numbers)
III!II I I � IR!!�I 111
EXHIBIT A
to
EQUIPMENT LEASE PURCHASE AGREEMENT
between
CITY OF PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION
and
CITY OF PUEBLO, COLORADO
50* - 1991 Hyundai Gas Cars including:
Executive Suntop, Sweater Baskets,
Full Wheel Covers
10 - New Tires and Wheels
2 - 3/4 inch Discharge Tenaka Sump Pumps
Service manuals, adequate supply of spark plugs, air
cleaners
* Plus an option for 10 more at the same price.
NOTE: The above is subject to revision as additional
information is received (including but not limited to Serial
Numbers)
EXHIBIT B
$168,600
THE CITY OF PUEBLO, COLORADO
LEASE PURCHASE AGREEMENT WITH
THE CITY OF PUEBLO MUNICIPAL BUILDING CORPORATION
LEASE PAYMENTS
TOTAL
DATE
PRINCIPAL
COUPON
INTEREST
RASE RE&MIS
FISCAL TOTAL
12/1191
37,400.00
8.00
7,530.80
44,930.80
44,930.80
611/92
5,248.00
5,248.00
12/1/92
40,400.00
8.00
5,248.00
45,648.00
50,896.00
6/1/93
3,632.00
3,632.00
12/1/93
43,700.00
8.00
3,632.00
47,332.00
50,964.00
6/1/94
1,884.00
1,884.00
12/1/94
47,100.00
8.00
1,884.00
48,984.00
50,868.00
168,600.00
29,058.80
197,658.80
SECURITY AND TRUST AGREEMENT
THIS SECURITY AND TRUST AGREEMENT dated as of May 23, 1991,
together with any amendments hereto made in accordance herewith,
(the "Agreement "), by and between the CITY OF PUEBLO, COLORADO
MUNICIPAL BUILDING CORPORATION ( "PMBC "), a nonprofit corporation
duly organized and existing under the laws of the State of
Colorado, and The Pueblo Bank and Trust Company, as trustee (the
"Trustee "), having an office and principal place of business in
Pueblo, Colorado, duly organized and existing under the laws of
the State of Colorado, being authorized to accept and execute
trusts of the character herein set out under and by virtue of
the laws of the State of Colorado;
W I T N E S S E T H:
WHEREAS, the City of Pueblo, Colorado (the "City "), for the
purposes of financing the acquisition of equipment (the
"Equipment" or "Collateral ") has entered into an annually
renewable Lease Purchase Agreement of even date herewith (the
"Lease "), between PMBC, as lessor, and the City, as lessee,
whereby the City has leased from PMBC the Equipment; and
WHEREAS, pursuant to the Lease, and subject to the right of
the City to terminate the Lease and other limitations as therein
provided, the City will pay certain Base Rentals and Additional
Rentals (as such terms are defined in the Lease) in consider-
ation for the right of the City to use the Equipment; and
WHEREAS, pursuant to this Agreement, PMBC has also granted
to the Trustee a security interest in the Equipment; and
WHEREAS, there will be executed and delivered by PMBC
pursuant to its Resolution dated May , 1991 (the
"Resolution ") one or more Certificates of Participation (the
"Certificates "), evidencing assignments of proportionate
interests in rights to receive Base Rentals and certain other
payments of which certain rights have been assigned to the
Trustee by PMBC; and
WHEREAS, the Certificates will be sold by PMBC to the
participants (the "Participants "); and
WHEREAS, the Trustee has entered into this Agreement for and
on behalf of the Participants, and will hold its rights
hereunder, including its rights with respect to the Equipment,
except as otherwise specifically provided herein, for the benefit
of the Participants, and will disburse moneys received by the
Trustee in accordance with this Agreement;
NOW, THEREFORE, THIS SECURITY AND TRUST AGREEMENT
WITNESSETH:
That PMBC, in consideration of the premises and the mutual
covenants herein contained and for the benefit of the
Participants and the sum of One Dollar ($1.00) to it duly paid by
the Trustee at or before the execution of these presents, and for
other good and valuable consideration, the receipt of which is
hereby acknowledged, in order to secure the payment of the
principal of, premium, if any, and interest on all Certificates
at any time outstanding under the Resolution and this Agreement,
(the "Obligations ") according to their tenor and effect, and to
secure the performance and observance of all the covenants and
conditions in the Certificates and herein contained, has
executed and delivered this Agreement and has granted unto The
Pueblo Bank and Trust Company (the "Trustee" or "Secured Party "),
and to its successors and assigns forever:
(a) a purchase money security interest in the
Equipment described in Exhibit A attached hereto, together
with all accessories, attachments, parts, equipment,
accessions or repairs now or hereafter affixed thereto or
used in connection therewith and substitutions or
replacements and proceeds thereof;
(b) all monies and securities from time to time held
by the Trustee under this Agreement or the Resolution
(except the Rebate Fund).
(c) all monies held by PMBC in the Acquisition Fund,
Certificate Fund, and Extraordinary Redemption Fund, except
as the same may be transferred to the Rebate Fund pursuant
to the Resolution. The Trustee specifically consents to the
use of such monies for the purposes set forth in the
Resolution.
TO HAVE AND TO HOLD the same with all privileges and ap-
purtenances hereby conveyed and assigned, or agreed or intended
to be, to the Trustee and its successors in said trust and
assigns forever;
IN TRUST, NEVERTHELESS, upon the terms herein set forth for
the equal and proportionate benefit, security and protection of
all Participants, without privilege, priority or distinction as
to the lien or otherwise of any of the Certificates over any
other of the Certificates;
PROVIDED, HOWEVER, that if the principal of the Certificates
and the premium, if any, and the interest due or to become due
thereon, shall be paid at the times and in the manner mentioned
in the Certificates according to the true intent and meaning
thereof, then upon such final payment this Agreement and the
rights hereby granted shall cease, terminate and be void;
-2-
subject to the terms, conditions, stipulations, covenants,
agreements, trusts, uses and purposes as hereinafter expressed,
and PMBC has agreed and covenanted, and does hereby agree and
covenant, with the Trustee for the benefit of the Participants,
as follows:
1. Representations and Covenants
(a) Representations. PMBC represents and warrants that (i)
PMBC has, or forthwith will acquire, title to the Collateral free
and clear of all liens and encumbrances; (ii) no financing
statement covering any of the Collateral is on file in any public
office; (iii) the certificate of incorporation of PMBC does not
prohibit the security interest granted herein and the execution
of this Agreement will not violate any law of any agreement to
which it is a party;
(b) Covenants. PMBC covenants and agrees that it; (i) will
keep of cause the Collateral to be kept in first class order,
repair, and running condition, will replace any worn, broken, or
defective parts and will house the Collateral in suitable shelter
and shall make no material alterations in the Collateral without
the prior written consent of the Trustee; (ii) will promptly pay
or cause to be paid all taxes levied or assessed, if any, against
the Collateral and will keep the Collateral free and clear of all
liens, attachments, and encumbrances; (iii) will allow the
Trustee and its representatives free access to the Collateral at
all reasonable times for the purpose of inspection; (iv) will
promptly notify the Trustee in writing of any loss or damage to
the Collateral; (v) will keep or cause the Collateral to be
insured in the manner provided in the Lease against loss by theft
and fire and against such other perils as is usually carried by
owners of similar properties; (vi) will cause the Trustee to be
indemnified against all claims arising out of or connected with
the ownership or use of the Collateral; (vii) will reimburse the
Trustee upon demand for all expenses incurred in connection with
perfecting the security interest granted herein or the
satisfaction thereof; (vii) will not abandon the Collateral; (ix)
will not sell, assign, lease, mortgage, or otherwise dispose of
any interest in the Collateral without first obtaining the
written consent of the Trustee; (x) will not use or permit the
Collateral to be used for any unlawful purpose or in violation of
any federal, state or municipal law, statute or ordinance or for
hire; (xi) will not permit the Collateral to become a part 'of or
to be affixed to any real property of any person without first
making arrangements satisfactory to the Trustee to protect its
security interest therein; and (xii) will provide the Trustee
with a comprehensive list of the Participant's names, addresses
and phone numbers, and update the list should PMBC become aware
of any change in the Participants.
(c) Breach. If PMBC fails to observe or perform any
covenant or agreement contained in the Security and Trust
Agreement, which failure is not remedied by PMBC within five (5)
days after written notice thereof, the Trustee may, in addition
-3-
to any other remedy, take whatever action may be necessary to
remedy such failure and should such action require the
expenditure of monies to protect and preserve the Trustee's
interest in the collateral (including but not limited to payment
of insurance premiums, repairs, storage, transportation, removal
of liens, etc.), then the amount of such expenditure shall become
forthwith due and payable by PMBC, and if the Trustee takes any
action authorized hereunder, the Trustee shall not be liable to
PMBC for damages as a result of delays, temporary withdrawals of
the Collateral from service or other causes.
2. Assignment of Insurance Proceeds PMBC hereby assigns
to the Trustee any and all monies (including but not limited to,
proceeds of insurance or return of unearned premiums), which may
become due under any policy insuring the Collateral against any
loss or damage in accordance with the terms of this Security and
Trust Agreement. The Trustee shall hold such monies for
application pursuant to Article X of the Lease and the Trustee
shall cooperate with PMBC and the City in assigning the proceeds
to PMBC or the City for the repair of the Equipment or purchase
of replacement equipment pursuant to Article X of the Lease.
3. Events of Default The occurrence of any of the
following events in addition to those events specified under
Article VII of the Resolution, shall constitute a default, as
such term is used herein: (a) failure to pay, when due, any
amount payable on any of the Obligations and the payments
required of PMBC specified in Section 1 hereof and such default
shall continue for a period of five (5) days; (b) if any
statement, representation, or warranty made herein shall be false
or breached in any material respect; (c) failure by PMBC to
observe or perform any other covenant or agreement herein or in
any other instrument specified above; (d) should PMBC become
insolvent (however evidenced) or commit any act of bankruptcy or
make a general assignment for the benefit of creditors, or if any
proceeding is instituted by or against PMBC for any relief under
any bankruptcy or insolvency laws, or if a receiver is appointed
of, or a writ or order of attachment or garnishment is made or
issued, or if any proceeding or procedure is commenced or any
remedy supplementary to or in enforcement of a judgement is
employed against, or with respect to any property of PMBC; (e)
termination or suspension of the transaction of the usual
business of PMBC; (g) should the Collateral be substantially
damaged or destroyed or should the Trustee deem the Collateral
unsafe or at any risk; or (g) PMBC shall default in the
performance of any obligation or in the payment of any sum due to
the Trustee under any other contract, agreement, arrangement, or
understanding, or any indebtedness of PMBC for borrowed money
shall become due and payable by acceleration of the maturity
thereof.
4. Remedies on Default Whenever a default shall be
existing, the Trustee in accordance with and in addition to those
rights and remedies set forth in Article VII of the Resolution,
-4-
shall have the following rights and remedies and the payment
requirements of PMBC specified in Section 1 hereof, as permitted
by applicable law: (a) to declare all Obligations due and
payable, at the option of the Trustee, without notice or demand;
(b) to enter the premises or such place or places where any of
the Collateral may be located and take and carry away the same,
by any of its representatives, with or without legal process, to
the Trustee's place of storage; (c) to sell the Collateral at
public sale, or private sale whether or not the Collateral is in
constructive possession of the Trustee or the person conducting
the sale, in one or more sales, as an entirety or in parcels, for
the best price that the Trustee can obtain and upon such terms as
the Trustee may deem desirable; (d) to require PMBC to pay all
expenses of such sale, taking, keeping, and storage of the
Collateral, including reasonable attorney's fees; (e) to apply
the proceeds of such sale to all expenses in connection with the
taking and sale of the Collateral, and any balance of such
proceeds toward the payment of the Obligations and other payment
requirements in such order of application as the Trustee may from
time to time elect; (f) to require PMBC to assemble the
Collateral upon the Trustee's demand, at PMBC's expense, and make
it available to the Trustee at a place designated by the Trustee
which is reasonably convenient to both parties; and (h) to
exercise any one or more rights or remedies accorded by the
Uniform Commercial Code. If the proceeds of any such sale are
insufficient to pay the expenses, as aforesaid, and the
Obligations and other payment requirements, PMBC agrees to pay
any deficiency to the Trustee upon demand and if such proceeds
are more than sufficient to pay such expenses and Obligations and
other payment requirements, the Trustee agrees to pay the surplus
to PMBC. No right or remedy is intended to be exclusive of any
other rights or remedies, but each and every such right or remedy
shall be cumulative and in addition to any other remedy given by
statute.
5. Financing Statement PMBC will join with the Trustee in
executing one or more financing statements pursuant to the
Uniform Commercial Code in form satisfactory to the Trustee.
PMBC hereby authorizes the Trustee to file a financing statement
signed only by the Trustee in all places where necessary to
perfect the Trustee's security interest in the Collateral in all
jurisdictions where such authorization is permitted by the
Uniform Commercial Code. Without limiting the foregoing, PMBC
agrees that whenever the Uniform Commercial Code requires PMBC to
sign a financing statement for filing purposes, PMBC hereby
appoints the Trustee or any of the Trustee's representatives as
PMBC's attorney and agent, with full power of substitution, to
sign or endorse PMBC's name on any such financing statement or
other document and authorizes the Trustee to file such a
financing statement in all places where necessary to perfect the
Trustee's Security Interest in the Collateral; and PMBC hereby
ratifies all acts of said attorney and said substitute and agrees
to hold the Trustee and said attorney harmless from any acts of
commission or omission or any error of judgment or mistake of
-5-
fact or law pertaining thereto. A photographic or other
reproduction of this Agreement, or any financing statement signed
by PMBC, is sufficient as a financing statement.
6. Notice of Default The Trustee shall not find PMBC in
default under this Agreement until the occurrence of one or more
of the following; (a) the Trustee has actual notice that a
default, as described in paragraph 3, has occurred and PMBC has
failed to cure the default within the prescribed period; or (b)
after the Trustee receives notice from one or more of the
Participants or any other person or entity that an event of
default has occurred.
7. Duties of the Trustee The Trustee hereby accepts the
trusts imposed upon it by this Agreement and the Resolution, and
agrees to perform said trusts (including, without limitation, the
delegation to the Trustee by PMBC of all duties of PMBC under the
Lease), but only upon and subject to the following express terms
and conditions, and any implied covenants or obligations which
shall be read into this Agreement against the Trustee:
(a) The Trustee, prior to the occurrence of an Event
of Default and after the curing of all Events of Default
which may have occurred, undertakes to perform such duties
and only such duties as are specifically set forth in this
Agreement or the Resolution. In case an Event of Default
has occurred (which has not been cured or waived) the
Trustee shall exercise such of the rights and powers vested
in it by this Agreement, and use the same degree of care and
skill in their exercise as a reasonable and prudent person
would exercise or use under the circumstances in the conduct
of his or her own affairs.
(b The Trustee may execute any of the trusts or
hereof ereof and perform any of its duties by or through
attorneys, agents, receivers or employees but shall be
answerable for the conduct of the same in accordance with
the standard specified above, and shall be entitled to act
upon an Opinion of Counsel concerning all matters of trust
hereof and the duties hereunder, and in all cases pay such
reasonable compensation to all such attorneys, agents,
receivers and employees as may reasonably be employed in
connection with the trusts hereof. The Trustee may act upon
an Opinion of Counsel and shall not be responsible for any
loss or damage resulting from any action or nonaction taken
by or omitted to be taken in good faith in reliance upon
such Opinion of Counsel.
(c) The Trustee shall not be responsible for any
recital herein or in the Certificates, or for the recording
or rerecording, filing or refiling of the Lease, the
Resolution or this Agreement or of any supplements thereto
or hereto or instruments of further assurance, or collecting
any insurance monies or for the validity of the execution by
PMBC of this Agreement or of any supplements hereto or
instruments of further assurance, or for the sufficiency of
the security for the Certificates issued hereunder or
intended to be secured hereby, or for the value of or title
to the Equipment, and the Trustee shall not be bound to
ascertain or inquire as to the performance or observance of
any covenants, conditions or agreements on the part of PMBC
or the City, except as provided herein; but the Trustee may
require of PMBC or the City full information and advice as
to the performance of the covenants, conditions and
agreements aforesaid. The Trustee shall have no obligation
to perform any of the duties of the City under the Lease;
and the Trustee shall not be responsible or liable for any
loss suffered in connection with any investment of funds
made by it in accordance with Section 5.01 of the
Resolution.
(d) The Trustee may become the registered owner of the
Certificates with the same rights which it would have if not
the Trustee.
(e) The Trustee shall be protected in acting upon any
notice, request, consent, certificate, order, affidavit,
letter, telegram or other paper or document believed to be
genuine and correct and to have been signed or sent by the
proper person or persons. Any action taken by the Trustee
pursuant to the Resolution or this Agreement upon the
request or authority or consent of any person who at the
time making such request or giving such authority or consent
is the owner of any Certificate shall be conclusive and
binding upon all future registered owners of the same
Certificate and upon any Certificates issued in place
thereof.
(f) As to the existence or nonexistence of any fact or
as to the sufficiency or validity of any instrument, paper
or proceeding, the Trustee shall be entitled to rely upon a
certificate signed on behalf of the City by the City
Representative or such other person as may be designated for
such purpose by a certified City resolution, as sufficient
evidence of the facts therein contained, and, prior to the
occurrence of a default of which the Trustee has been
notified as provided in subsection (h of this Section or of
which by said subsection it is deemed to have notice, shall
also be at liberty to accept a similar certificate to the
effect that any particular dealing, transaction or action is
necessary or expedient, but shall in no case be bound to
secure the same.
(g) The permissive right of the Trustee to do things
enumerated in this Agreement shall not be construed as a
duty and the Trustee shall not be answerable for other than
its negligence or willful default.
-7-
(h) The Trustee shall not be required to take notice
or be deemed to have notice of any default hereunder except
failure by the City or PMBC to cause to be made any of the
payments to the Trustee required to be made to it by the
Lease, the Resolution or this Agreement, unless the Trustee
shall be specifically notified in writing of such default by
PMBC or the City, or by the registered owners of at least
25% in aggregate principal amount of Certificates then
outstanding, and all notices or other instruments required
by this Agreement, the Lease or the Resolution to be
delivered to the Trustee, must, in order to be effective, be
delivered to the principal office of the Trustee, and in the
absence of such notice so delivered, the Trustee may
conclusively assume there is no default except as aforesaid.
(i) All monies received by the Trustee shall, until
used or applied or invested as herein provided, be held in
trust in the manner and for the purposes for which they were
received but need not be segregated from other funds except
to the extent required by this Agreement, the Resolution, or
by law. The Trustee shall not be under any liability for
interest on any monies received hereunder except such as may
be agreed upon.
(j) At any and all reasonable times the Trustee, and
its duly authorized agents, attorneys, experts, engineers,
accountants and representatives, shall have the right, but
shall not be required to inspect any and all of the
Equipment pledged herein, including all books, papers and
records of PMBC or the City pertaining to the Equipment.
(k) The Trustee shall not be required to give any bond
or surety in respect of the execution of the said trusts and
powers or otherwise in respect of the premises.
(1) Notwithstanding anything in this Agreement
contained, the Trustee shall have the right, but shall not
be required, to demand in respect of the execution and
delivery of any Certificates, the withdrawal of any cash, or
any action whatsoever within the purview of this Agreement,
any showings, certificates, opinions, appraisals, or other
information, or corporate action or evidence thereof, in
addition to that by the terms hereof required as a condition
of such action by the Trustee deemed desirable for the
purpose of establishing the right of PMBC or the City to the
execution and delivery of any Certificates, the withdrawal
of any cash, or the taking of any other action by the
Trustee.
(m) Before taking any action hereunder the Trustee may
require that satisfactory indemnity be furnished to it by
the Participants for the reimbursement of all expenses which
it may incur and to protect it against all liability, except
liability which may result from its negligence or willful
default, by reason of any action so taken.
IM
8. Fees and Expenses of Trustee The Trustee shall be
entitled to payment and reimbursement for its reasonable fees for
its services rendered hereunder as and when the same become due
and all expenses reasonably and necessarily made or incurred by
the Trustee.
9. _Resignation or Replacement of Trustee The present or
any future Trustee may resign by giving written notice to the
City and to PMBC not less than sixty (60) days before such
resignation is to take effect. Such resignation shall take
effect only upon the appointment of a successor qualified as
provided in the third paragraph of this paragraph 9. The present
or any future Trustee may be removed at any time by an instrument
in writing, executed by the registered owners of a majority in
aggregate principal amount of the Certificates then Outstanding
and delivered to the Trustee.
In case the present or any future Trustee shall at any time
resign or be removed or otherwise become incapable of acting, a
successor may be appointed by the registered owners of a majority
in aggregate principal amount of the Certificates then
outstanding by an instrument or concurrent instruments signed by
such Participants, or their attorneys -in -fact duly appointed;
provided that the City may, by an instrument executed by order of
the City Council, appoint a successor until a new successor shall
be appointed by the Participants as herein authorized. The City
upon making such appointment shall forthwith give notice thereof
to each Participant and to PMBC, which notice may be given
concurrently with the notice of resignation given by any
resigning Trustee. Any successor so appointed by the City shall
immediately and without further act be superseded by a successor
appointed in the manner above provided by the registered owners
of a majority in aggregate principal amount of the Certificates
Outstanding.
Every successor shall always be a bank or trust company in
good standing, qualified to act hereunder, and having a capital
and surplus of not less than $10,000,000. Any successor
appointed hereunder shall execute, acknowledge and deliver to the
City and to PMBC an instrument accepting such appointment
hereunder, and thereupon such successor shall, without any
further act, deed or conveyance, become vested with all the
estates, properties, rights, powers and trusts of its predecessor
in the trust hereunder with like effect as if originally named as
Trustee herein; but the Trustee retiring shall, nevertheless, on
the written demand of its successor, execute and deliver an
instrument conveying and transferring to such successor, upon the
trusts herein expressed, all the estates, properties, rights,
powers and trusts of the predecessor, which shall duly assign,
transfer and deliver to the successor all properties and monies
held by it under this Agreement, the Lease and the Resolution.
Should any instrument in writing from the City or PMBC be
required by any successor for more fully certainly vesting in and
am
confirming to it, the said conveyances and instruments in writing
shall be made, executed, acknowledged and delivered by the City
or PMBC on request of such successor.
The instruments evidencing the resignation or removal of the
Trustee and the appointment of a successor hereunder, together
with all other instruments provided for in this Section shall be
filed and /or recorded by the successor Trustee in each recording
office, if any, where this Agreement or the Resolution shall have
been filed and /or recorded.
10. Conversion, Consolidation or Merger of Trustee Any
bank or trust company into which the Trustee or its successor may
be converted or merged, or with which it may be consolidated, or
to which it may sell or transfer its trust business as a whole
shall be the successor Trustee under this Agreement, the Lease
and the Resolution with the same rights, powers, duties and
obligations and subject to the same restriction, limitations and
liabilities as its predecessor, all without the execution or
filing of any papers or any further act on the part of any of the
parties hereto or thereto, anything herein or therein to the
contrary notwithstanding.
11. Intervention by Trustee In any judicial proceeding to
which PMBC or the City is a party and which in the opinion of the
Trustee and its counsel has a substantial bearing on the
interests of registered owners of the Certificates, the Trustee
may intervene on behalf of registered owners of the Certificates,
and the Trustee shall do so if requested in writing by the
registered owners of at lease 25% in aggregate principal amount
in Certificates then Outstanding.
12. Escrowed Bill of Sale The Trustee agrees to hold the
escrowed bill of sale provided for in Section 12.3 of the Lease,
for the benefit of the City and to date and release the escrowed
bill of sale to the City, all as provided in said Section 12.3 of
the Lease.
13. Miscellaneous This Agreement is in addition to and
not in limitation of any other rights and remedies the Trustee
may have by virtue of any other instrument or agreement
heretofore, contemporaneously herewith or hereafter executed by
PMBC or by law or otherwise. If any provision of this Agreement
is contrary to applicable law such provision shall be deemed
ineffective without invalidating the remaining provisions hereof.
If and to the extent that applicable law confers any rights or
imposes any duties inconsistent with or in addition to any of the
provisions of this Agreement, the affected provision shall be
considered amended to conform thereto. The Trustee shall not by
any act, delay, omission, or otherwise be deemed to have waived
any of its rights or remedies hereunder. A Waiver by the Trustee
of any right or remedy hereunder on any one occasion, shall not
be construed as a bar to or waiver of any such right or remedy
which the Trustee would have had on any future occasion nor shall
-10-
provisions of this Agreement, the affected provision shall be
considered amended to conform thereto. The Trustee shall not by
any act, delay, omission, or otherwise be deemed to have waived
any of its rights or remedies hereunder. A Waiver by the Trustee
of any right or remedy hereunder on any one occasion, shall not
be construed as a bar to or waiver of any such right or remedy
which the Trustee would have had on any future occasion nor shall
the Trustee be liable for exercising or failing to exercise any
such right or remedy. It is expressly understood and agreed that
whenever the service of any notice to PMBC is required hereby or
is otherwise required such notice may be sent to PMBC by ordinary
mail to the address shown at the beginning of this Agreement, and
if so mailed, such notice shall after five days have expired from
such mailing be deemed sufficient notice thereof. This Agreement
shall be binding, jointly and severally, upon all parties
described as PMBC. This Agreement is executed in, and shall be
construed in accordance with the laws of the State of Colorado.
PMBC hereby acknowledges receipt of a true executed copy of
this SECURITY AND TRUST AGREEMENT.
Attest:
Secre airy
City of Pue o Co ra o
Municipal Building Corporation
{SEAL}
PUEBLO BANK AND TRUST COMPANY
By
By
-11-
EXHIBIT A
to
SECURITY AND TRUST AGREEMENT
between
CITY OF PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION
and
CITY OF PUEBLO, COLORADO
50* - 1991 Hyundai Gas Cars including:
Executive Suntop, Sweater Baskets,
Full Wheel Covers
10 - New Tires and Wheels
2 - 3/4 inch Discharge Tenaka Sump Pumps
Service manuals, adequate supply of spark plugs, air
cleaners
* Plus an option for 10 more at the same price.
NOTE: The above is subject to revision as additional information
is received (including but not limited to Serial Numbers)
-12-
EQUIPMENT LEASE PURCHASE AGREEMENT
THIS EQUIPMENT LEASE PURCHASE AGREEMENT dated as of May 23,
1991 (together with any amendments hereto made in accordance
herewith, this "Lease "), entered into by and between the CITY OF
PUEBLO, COLORADO MUNICIPAL BUILDING CORPORATION, as the lessor
hereunder ("PMBC"), a nonprofit corporation duly organized,
existing and in good standing under the laws of the State of
Colorado, and the CITY OF PUEBLO, COLORADO (the "City "), as
lessee hereunder, a home rule municipality, duly organized under
Article XX of the Constitution of the State of Colorado (the
"State ") and the Home Rule Charter (the "Charter ") of the City;
W I T N E S S E T H:
WHEREAS, the City is a duly and regularly created,
organized and existing home rule municipality, existing as such
under and by virtue of Article XX of the Constitution of the
State and the Charter of the City; and
WHEREAS, the City Council of the City (the "City Council ")
has the power, pursuant to Sections 1 -3 and 3 -9 of the Charter,
to enter into lease and lease purchase agreements in order to
provide for the financing of equipment; and
WHEREAS, the City Council also has the power, pursuant to
Sections 1 -3 and 3 -9 of the Charter, to purchase real and
personal property and to sell and convey real and personal
property of the City upon such terms and conditions as the City
Council may approve; and
WHEREAS, the City Council has determined, and hereby
determines, that the City is in need of certain equipment (the
"Equipment ") as hereafter described; and
WHEREAS, the City Council has determined, and hereby
determines, that it is necessary and in the best interests of
the City that the Equipment be acquired; and
WHEREAS, for purposes of providing for the City's
acquisition of the Equipment, the City Council has determined
and hereby determines that it is in the best interests of the
City that the City and PMBC enter into this Lease to provide for
the acquisition of the Equipment by the City; and
WHEREAS, PMBC is a nonprofit corporation, duly organized,
existing and in good standing under the laws of the State of
Colorado, and is duly qualified to do business in the State of
Colorado; and under its articles and bylaws, PMBC is authorized
to own and hold or lease real and personal property and to lease
the same as lessor and to act in the manner contemplated herein;
and
WHEREAS, pursuant to a certain Security and Trust Agreement
of even date herewith (the "Agreement "), by and between PMBC and
The Pueblo Bank and Trust Company, as trustee (the "Trustee "),
PMBC will conditionally assign certain of its rights, title and
interest in to this Lease (except the rights of PMBC under
Sections 13.3 and 14.3 of this Lease) to the Trustee for the
benefit of the Participants (as hereinafter defined); and
WHEREAS, there are being issued, pursuant to the
Resolution, Certificates of Participation (the "Certificates ")
evidencing assignments of proportionate undivided interests in
rights to receive certain payments under this Lease; and
WHEREAS, the obligation of the City to pay Base Rentals and
Additional Rentals (both as hereinafter defined) hereunder shall
be from year to year only; shall constitute currently budgeted
expenditures of the City; shall not constitute a mandatory
charge or requirement in any ensuing budget year; and shall not
constitute a general obligation or other indebtedness of the
City within the meaning of any constitutional, statutory or
Charter limitation or requirement concerning the creation of
indebtedness, nor a mandatory payment obligation of the City in
any ensuing fiscal year beyond any fiscal year during which this
Lease shall be in effect; and
WHEREAS, the Certificates shall evidence assignments of
proportionate undivided interests in the Revenues (as
hereinafter defined), shall be payable solely from the sources
herein provided, and shall not constitute a general obligation
or other indebtedness of the City within the meaning of any
constitutional, statutory or Charter limitation or requirement
concerning the creation of indebtedness, nor a mandatory payment
obligation of the City in any ensuing fiscal year beyond the
current fiscal year; and
WHEREAS, neither this Lease nor the issuance of the
Certificates shall directly or indirectly obligate the City to
make any payments beyond those appropriated for any fiscal year
during which this Lease shall be in effect; and
WHEREAS, the acquisition of the Equipment, and the
execution, performance and delivery of this Lease, have been
authorized, approved and directed by the City Council by an
ordinance adopted by the City Council; and
WHEREAS, the execution, delivery and performance of this
Lease by PMBC, and the conditional assignment by PMBC to the
Trustee, pursuant to the Resolution, of certain rights and
interest of PMBC in, to and under this Lease (except the rights
of PMBC under Sections 13.3 and 14.3 of this Lease), have been
authorized, approved and directed by all necessary and
IWM
appropriate action of PMBC, its board of directors and its
officers; and
WHEREAS, PMBC desires to lease the Equipment to the City,
and the City desires to lease the Equipment from PMBC, pursuant
to the terms and conditions and for the purpose set forth
herein;
NOW, THEREFORE, for and in consideration of the mutual
promises and covenants herein contained, the parties hereto
agree as follows:
ARTICLE I
DEFINITIONS
All words and phrases defined in Article I of the
Resolution shall have the same meaning in this Lease. In
addition, the following terms will have the meanings specified
below unless the context clearly requires otherwise:
"Acquisition Fund" means the special fund created under and
to be dispursed as provided in Section 3.08 of the Resolution.
"Additional Rentals" means the cost of all taxes, insurance
premiums, expenses and fees of the Trustee, costs of
maintenance, upkeep and repair, and all charges or costs which
the City assumes or agrees to pay hereunder with respect to the
Equipment, other than Base Rentals (together with interest that
may accrue thereon in the event that the City shall fail to pay
the same, as set forth herein), including but not limited to
costs and expenses charged to or incurred by PMBC at the request
of the City and in its capacity as Lessor hereunder.
"Agreement" means that certain Security and Trust Agreement
of even date herewith between PMBC and the Trustee, and any
amendments or supplements thereot.
"Base Rentals" means the payments payable by the City
pursuant to Section 6.2 of this Lease and Exhibit B hereto,
during the Original Term and any Renewal Term, which constitute
the payments payable by the City for and in consideration of the
right to use the Equipment during such Original Term or Renewal
Term.
"Base Rental Payment Date" means June 1 and December 1 of
each year, commencing December 1, 1991.
"Business Day" means any day other than a Saturday, Sunday
or legal holiday or day on which banking institutions in the
city in which the Trustee has its principal corporate trust
office or New York, New York are authorized or required by law
to close.
-3-
"Certificate Fund" means the special fund created under
Section 3.02 of the Resolution for the purpose of holding and
disbursing to the Participants the Base Rentals paid by the
City, and includes both the Principal Account and the Interest
Account thereof.
"Certificates of Participation" or "Certificates" means one
or more certificates or participation to be issued pursuant to
the Resolution evidencing assignments of proportionate undivided
interests in rights to receive Revenues.
"Charter" means the home rule Charter of the City, and any
amendments or supplements thereto.
"City" means City of Pueblo, Colorado or any successor to
its functions.
"City Council" means the City Council of the City or any
successor to its functions.
"City Representative" means the person at the time
designated to act on behalf of the City for the purpose of
performing any act under this Lease or the Resolution by a
written certificate furnished to the Trustee and PMBC containing
the specimen signature of such person or persons and signed on
behalf of the City by the President or Vice President of the
City Council.
"Code" means the Internal Revenue Code of 1986, as amended.
"Equipment" means that equipment listed on Exhibit A
attached hereto.
"Event of Default" means one or more events of default as
defined in Section 14.1 of this Lease.
"Event of Nonappropriation" means a nonrenewal of this
Lease by the City, determined by the failure of the City
Council, for any reason, to budget and appropriate, specifically
with respect to this Lease, moneys sufficient to pay all Base
Rentals and reasonably estimated Additional Rentals, as provided
in Section 6.6 of this Lease.
"Extraordinary Redemption Fund" means the special fund
created under Section 3.07 of the Resolution.
"Extraordinary Revenues" means (i) the Purchase Option
Price, if paid; (ii) all Net Proceeds, if any, of casualty
insurance and not applied to the repair, restoration,
modification, improvement or replacement of the Equipment, which
are received pursuant to the provisions of this Lease; and (iii)
all Net Proceeds, if any, derived from subleasing the Equipment
or any portion thereof, and the leasing, sale or assignment of
the Trustee's interest in the Equipment, pursuant to Sections
7.02 and 7.05 of the Resolution.
IME
" Force Majeure means, without limitation, the following:
acts of God; strikes, lockouts or other industrial disturbances;
acts of public enemies; orders of restraints of any kind of the
government of the United States of America or of the State or
any of their departments, agencies or officials or any civil or
military authority; insurrection; riots; landslides;
earthquakes; fires; storms; droughts; floods; explosions;
breakage or accidents to machinery, transmission pipes or
canals; or any other cause or event not within the control of
PMBC or the City.
"Independent Counsel" means an attorney duly admitted to
the practice of law before the highest court in the State of
Colorado and who is not an employee of PMBC, the Trustee or the
City.
"Interest Payment Date" means June 1 and December 1 of each
year, commencing December 1, 1991.
"Lease" means this Equipment Lease Purchase Agreement and
any amendments or supplements hereto, including the Exhibits
attached hereto.
"Lease Term" means the Original Term and any Renewal Terms
as to which the City may exercise its option to renew this
Lease, as further provided under Section 4.1 of this Lease;
subject to the terms and provisions of Sections 4.2, 6.1, 6.2
and 6.6 of this Lease. "Lease Term" refers to the time during
which the City is the lessee under the Lease; provided, however,
certain provisions of this Lease survive the termination of the
Lease Term, as further provided in Section 4.2 of this Lease.
"Lessor" means the City of Pueblo, Colorado Municipal
Building Corporation, a Colorado nonprofit corporation, ( "PMBC")
acting as lessor under this Lease and grantor under the
Agreement, or any successor thereto.
"Lessor Representative" means any of the following: i ) the
Chairman or President of PMBC; (ii) any Vice Chairman or Vice
President of PMBC; (iii) any Secretary or Assistant Secretary of
PMBC; or (iv) any other person or persons at the time designated
to act on behalf of PMBC for purposes of performing any act on
behalf of PMBC under this Lease or the Resolution by a written
certificate furnished to the City and the Trustee containing the
specimen signature of such person or persons and signed on
behalf of PMBC by the Chairman or President or any Vice Chairman
or Vice President of PMBC.
"Net Proceeds," when used with respect to any proceeds from
policies of insurance required hereby, or proceeds from any
foreclosure and sale of the Equipment, means the amount
remaining after deducting from the gross proceeds thereof all
expenses (including, without limitation, attorneys' fees and
costs) incurred in the collection of such proceeds or award.
1&70
"Opinion of Counsel" means an opinion in writing of legal
counsel, who may be counsel to the Trustee, the City or PMBC.
"Original Term" means the portion of the Lease Term which
terminates on December 31, 1991.
"PMBC" is the City of Pueblo, Colorado Municipal Building
Corporation, a nonprofit corporation.
"Participant" or "registered owner" of a Certificate means
the registered owner of any Certificate, as shown in the
registration books.
"Permitted Encumbrances" means, as of any particular time,
(i) liens for taxes and assessments not then delinquent, or
liens which may remain unpaid pursuant to the provisions of
Article VIII and Article IX of this Lease; (ii) this Lease and
the Agreement; (iii) any UCC Financing Statements filed to
perfect security interest pursuant to this Lease, the Agreement
or the Resolution; and (iv) such minor defects, irregularities,
encumbrances and clouds on title as normally exist with respect
to property of the general character of the Equipment and as do
not, in the opinion of the City Representative, materially
impair the value of or title to the Equipment.
"Purchase Option Price" means the amount payable, at the
option of the City, for the purpose of terminating this Lease
and purchasing the Equipment, which amount shall be equal to
such amount as shall be necessary to discharge the Resolution in
the manner provided in Article VI of the Resolution.
"Renewal Date" means January 1, 1992 and each January 1
thereafter.
"Renewal Term" means any optional Renewal Term of the Lease
Term as provided in Article IV of this Lease.
"Resolution" means that resolution of PMBC No. 1 dated May
1991.
"Revenues" means (i) Extraordinary Revenues, if any; ii
the Base Rentals; (iii.) all other revenues derived from this
Lease, excluding Additional Rentals and excluding payment
constituting compensation to the Trustee for its services; and
(iv) any other moneys to which the Trustee may be entitled for
the benefit of the Participants.
"State" means the State of Colorado.
"Termination Event" means (a) an Event of Nonappropriation,
(b) an Event of Default under the Lease followed by a
determination by the Trustee to terminate the Lease, or (c) an
exercise by the City of its right to terminate the Lease under
Section 10.3 of the Lease.
-6-
"Trustee" means The Pueblo Bank and Trust Company, a state
chartered banking corporation with its principal corporate trust
office located in Pueblo, Colorado, acting in the capacity of
trustee for the Participants pursuant to the Resolution and the
Agreement, and any successor thereto appointed under the
Resolution.
"Trustee Representative" means the person or persons at the
time designated to act on behalf of the Trustee for purposes of
performing any act on behalf of the Trustee under the
Resolution, the Agreement or this Lease by a written certificate
furnished to the City and PMBC containing the specimen signature
of such person or persons and signed on behalf of the Trustee by
and duly authorized officer of the Trustee.
ARTICLE II
REPRESENTATIONS, COVENANTS AND WARRANTIES
Section 2.1. Representations, Covenants and Warranties of
the City The City represents, covenants and warrants for the
benefit of the Trustee, the Participants and PMBC as follows:
(a) The City is a home rule municipality duly
organized and existing under Article XX of the Constitution
of the State and the Charter of the City. The City is
authorized by its Charter to enter into the transactions
contemplated by this Lease and to carry out its obligations
hereunder. The City has duly authorized and approved the
execution and delivery of this Lease and other documents
related to this transaction.
(b) The acquisition of the Equipment, under the terms
and conditions provided for in this Lease, is necessary,
convenient and in furtherance of the governmental purposes
of the City and is in the best interests of the City and
its inhabitants.
(c) During the Lease Term, the Equipment will at all
times be used by the City for the purpose of performing its
lawful governmental functions (except to the extent that
subleasing of the Equipment by the City is permitted by
Section 13.2 of this Lease).
(d) Neither the execution and delivery hereof, nor
the fulfillment of or compliance with the terms and
conditions hereof, nor the consummation of the transactions
contemplated hereby conflicts with or results in a breach
of the terms, conditions or provisions of any restriction
or any agreement or instrument to which the City is now a
party or by which the City is bound, or constitutes a
default under any of the foregoing or results in the
creation or imposition of any lien or encumbrance
whatsoever upon any of the property or assets of the City.
-7-
(e) To the knowledge of the City, there is no
litigation or proceeding pending or threatened against the
City or any other person affecting the right of the City to
execute this Lease or the ability of the City to make the
payments required hereunder or to otherwise comply with the
obligations contained herein.
Section 2.2. Representations, Covenants and Warranties of
Lessor PMBC represents, covenants and warrants for the benefit
of the City, the Trustee and the Participants as follows:
(a) PMBC is a nonprofit corporation duly organized,
existing and in good standing under the laws of the State,
is duly qualified to do business in the State, has all
necessary power and authority to enter into and perform and
observe the covenants and agreements on its part contained
in this Lease, is possessed of full power and authority to
own and hold real and personal property and to lease the
same as lessor, and by proper action has duly authorized
the execution and delivery of this Lease.
Jb) PMBC will not pledge or assign the Revenues or
any o its other rights under this Lease except pursuant to
the Resolution, and except for any assignment pursuant to
Section 13.1 of this Lease; and PMBC will not encumber the
Equipment except for Permitted Encumbrances.
(c) Neither the execution and delivery hereof, nor
the fulfillment of or compliance with the terms and
conditions hereof, nor the consummation of the transactions
contemplated hereby, conflicts with or results in a breach
of the terms, conditions and provisions of any restriction
or any agreement or instrument to which PMBC is now a party
or by which PMBC is bound, or constitutes a default under
any of the foregoing and will not conflict with or
constitute a violation of any constitutional or statutory
provision or order, rule, regulation, decree or ordinance
of any court, government or governmental authority having
jurisdiction over PMBC or its property and which conflict
or violation will have a material adverse effect on PMBC,
the Equipment or its operation.
(d) PMBC acknowledges and recognizes that this Lease
will be terminated at the end of the Original Term or any
Renewal Term in the event that sufficient funds are not
budgeted and appropriated by the City specifically with
respect to this Lease, to continue paying all Base Rentals
and Additional Rentals during the next occurring Renewal
Term, and that the acts of budgeting and appropriating
funds are legislative acts and, as such, are solely within
the discretion of the City Council.
(e) PMBC agrees that so long as any of the
Certificates are Outstanding, it will maintain its
existence, will continue to be qualified to do business in
the State, will maintain its principal place of business in
the State, will not dissolve and will not consolidate with
or merge into another legal entity or permit one or more
other legal entities to consolidate with or merge into it.
(f) There is no litigation or proceeding pending or,
to the knowledge of PMBC, threatened against PMBC or any
other person affecting the right of PMBC to execute or
deliver this Lease, the Agreement or the Resolution or to
comply with its obligations under this Lease, the Agreement
or the Resolution. Neither the execution and delivery of
this Lease, the Agreement or the Resolution by PMBC, nor
compliance by PMBC with its obligations under this Lease,
the Agreement and the Resolution, require the approval of
any regulatory body, any parent company, or any other
entity, which approval has not been obtained.
(g) This Lease constitutes a legal, valid and binding
obligation of PMBC enforceable in accordance with its
terms.
(h) PMBC owns the Equipment and has the authority and
the unencumbered right to lease the Equipment to the City
pursuant to this Lease.
ARTICLE III
DEMISING CLAUSE
PMBC demises
and leases the
Equipment
to the City, and the
City leases
the
Equipment from
PMBC, in
accordance with the
provisions
of
this Lease,
subject
only to Permitted
Encumbrances,
to
have and to hold for the
Original Term and the
Renewal Term,
if
any.
ARTICLE IV
LEASE TERM
Section 4.1. Commencement of Lease Term; Renewals The
Lease Term shall commence as of May 23, 1991. The Original Term
shall terminate on December 31, 1991. The Lease Term may be
continued, solely at the option of the City, for the first
Renewal Term starting January 1, 1992 and for additional Renewal
Terms thereafter, each of one year in duration, except that the
final Renewal Term, if any, shall commence on January 1, 1994
and shall terminate on December 31, 1994 or, if all Base Rentals
and Additional Rentals for such Renewal Term have not then been
paid by the City, on such later date as all Base Rentals and
Additional Rentals are paid by the City.
IM
In the event that the City shall determine, for any reason,
not to renew this Lease, the City shall give written notice to
such effect to the Trustee and PMBC not less than 30 days prior
to the end of the Original Term or the then current Renewal
Term; provided, however, that a failure to give such notice
shall not constitute an Event of Default, nor prevent the City
from declining to renew this Lease, nor result in any liability
on the part of the City.
The option of the City to renew or not to renew this Lease
shall be conclusively determined by whether or not the City
Council has, on or before the December 31 immediately preceding
the commencement of any Renewal Term, budgeted and appropriated,
specifically with respect to this Lease, moneys sufficient to
pay all the Base Rentals and reasonably estimated Additional
Rentals for such ensuing Renewal Term, all as further provided
in Section 6.6 of this Lease.
It is the intention of the City Council that the decision
to renew or not to renew this Lease shall be made solely by the
City Council and not by any other City officer, and the City
Manager of the City (or any other officer at any time charged
with the responsibility of formulating budget proposals) is
hereby directed to include in the budget proposals submitted to
the City Council, in any year in which this Lease shall be in
effect, items for all payments required for the ensuing Renewal
Term under this Lease. The City shall in any event, whether or
not the Lease is to be renewed, furnish the Trustee and Lessor
with copies of its annual budget promptly after the budget is
adopted.
The terms and conditions during any Renewal Term shall be
the same as the terms and conditions during the Original Term,
except that the Base Rentals shall be as provided in Exhibit B
to this Lease.
Section 4.2. Termination of Lease Term The Lease Term
shall terminate upon the earliest of any of the following
events:
(a) The expiration of the Original Term or any
Renewal Term during which there occurs an Event of
Nonappropriation (which is not thereafter waived) pursuant
to Article VI of this Lease;
(b) The purchase by the City of the Equipment as
provided in Article XII of this Lease (subject to the
proviso of (c) below, if applicable ) and the Certificates
shall have been paid or deemed paid pursuant to Article VI
of the Resolution;
(c) Discharge of the obligations under the
Resolution, as provided in Article VI of the Resolution
(except that, in the event of discharge of the obligations
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under the Resolution pursuant to the second paragraph of
Article VI of the Resolution, this Lease shall remain in
effect solely for the purpose of conferring rights upon the
Participants to payments of principal of, premium, if any,
and interest on the Certificates solely from moneys or
Federal Securities deposited in accordance with the
Resolution);
(d) An Event of Default and termination of the Lease
Term by the Trustee under Article XIV of this Lease;
(e) The election of the City to terminate the Lease
Term pursuant to Section 10.3(b) of this Lease; or
(f) December 31, 1994, which date constitutes the
last day of the final Renewal Term of this Lease, or such
later date as all Base Rentals and Additional Rentals
required hereunder shall be paid, with the effect that the
Certificates shall be paid or deemed paid pursuant to
Article VI of this Lease.
Termination of the Lease Term shall terminate all unaccrued
obligations of the City under this Lease (except for the
application of Section 7.02(b)(i) of the Resolution, in the
event the City holds over), and shall terminate the rights of
the City to possession of the Equipment under this Lease (except
to the extent of any conveyance pursuant to Article XII of this
Lease); but all other provisions of this Lease, including all
obligations of the City hereunder accrued prior to such
termination, and all obligations of the Trustee with respect to
the Participants and the receipt and disbursement of funds,
shall be continuing until the obligations under the Resolution
are discharged as provided in Article VI of the Resolution
(subject to the provision of (c) above, if applicable).
ARTICLE V
ENJOYMENT OF EQUIPMENT
PMBC hereby covenants that the City shall during the Lease
Term peaceably and quietly have and hold and enjoy the Equipment
without suit, trouble or hindrance from PMBC, except as
expressly required or permitted by this Lease, the Agreement or
the Resolution. PMBC shall not interfere with the quiet use and
enjoyment of the Equipment by the City during the Lease Term, so
long as the Lease Term shall be in effect. PMBC shall, at the
request of the City and at the cost of the City, join and
cooperate fully in any legal action in which the City asserts
its rights to such possession and enjoyment, or which involves
the imposition of any taxes or other governmental charges on or
in connection with the Equipment. In addition, the City may at
its own expense join in any legal action affecting its
possession and enjoyment of the Equipment, and shall be joined
(to the extent legally possible, and at the expense of the City)
in any action affecting its liabilities hereunder.
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Equitable title to the Equipment shall be deemed to vest in
the City, subject to the rights of PMBC and the Trustee under
this Lease, the Agreement and the Resolution.
ARTICLE VI
PAYMENTS BY THE CITY
Section 6.1. Payments to Constitute Currently Budgeted
Expenditures of the City The City and PMBC acknowledge and
agree that the Base Rentals and Additional Rentals hereunder
shall constitute currently budgeted expenditures of the City.
The obligations of the City under this Lease shall be from year
to year only (as further provided in Sections 4.1, 4.2, 6.2 and
6.6 hereof) , and shall not constitute a mandatory payment
obligation of the City in any fiscal year beyond a fiscal year
during which this Lease shall be in effect.
No provision of this Lease shall be construed or
interpreted as creating a general obligation or other
indebtedness of the City within the meaning of any
constitutional, statutory or Charter debt limitation. No
provision of this Lease shall be construed or interpreted as
creating a delegation of governmental powers nor as a donation
by or a lending of the credit of the City within the meaning of
Section 1 or 2 of Article XI of the Constitution of the State of
Colorado. Neither this Lease nor the issuance of the
Certificates shall directly or indirectly obligate the City to
make any payments beyond those appropriated for any fiscal year
in which the Lease shall be in effect. The City shall be under
no obligation to exercise its option to purchase the Equipment.
No provision of this Lease shall be construed to pledge or to
create a lien on any class or source of City moneys, nor shall
any provision of this Lease restrict the future issuance of any
City bonds or obligations payable from any class or source of
City moneys.
Section 6.2. Base Rentals and Additional Rentals The
City shall pay Base Rentals directly to PMBC for distribution to
the Participants in accordance with the Resolution during the
Lease Term on the due dates set forth in Exhibit B to this
Lease. The Base Rentals during the Original Term and any
Renewal Terms shall be in the amounts in the "Total Base Rental"
column, as set forth in Exhibit B to this Lease. There shall be
credited against the amount of Base Rentals otherwise payable
hereunder all amounts at the time on deposit in the Certificate
Fund and available for such payments to Participants. The
initial Base Rentals to be paid by the City on December 1, 1991
shall be in consideration for the use of the Equipment by the
City from May 23, 1991 until and including December 31, 1991.
Thereafter, Base Rentals due on June 1 and December 1 of any
year shall be in consideration for the use of the Equipment by
the City from the immediately preceding January 1 to and
including the immediately following December 31.
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In the event of any partial redemption of Certificates
prior to maturity, the Base Rentals shall be recalculated by
PMBC, so that the Base Rentals payable on December 1 shall be
equal to the amount necessary to pay the principal of and
interest on the Certificates coming due on the next Interest
Payment Date as the case may be.
The City shall pay Additional Rentals during the Lease Term
as herein provided. The Additional Rentals during the Lease
Term shall be in an amount sufficient to pay the fees and
expenses of the Trustee, payments for the cost of taxes,
insurance premiums, and all other expenses expressly required to
be paid hereunder or under the Resolution, including but not
limited to costs and expenses charged to or incurred by PMBC at
the request of the City and in its capacity as Lessor hereunder,
as well as for payments into the Rebate Fund, if any, required
by the Resolution. All Additional Rentals shall be paid by the
City on a timely basis directly to the Person or entity to which
such Additional Rentals are owed. If the estimates of the City
of Additional Rentals for any Renewal Term are not itemized in
the budget required to be furnished to the Trustee and Lessor
under Section 4.1 of this Lease, the City shall furnish an
itemization of such estimated Additional Rentals to the Trustee
and PMBC on or before the October 15 preceding such Renewal
Term.
Section 6.3. Interest Component A portion of each
payment of Base Rentals is paid as, and represents payment of,
interest, and Exhibit B attached hereto, as it may be amended
hereunder, sets forth the interest component of each payment of
Base Rentals.
Section 6.4. Manner of Payment The Base Rentals and, if
paid, the Purchase Option Price, shall be paid in lawful moneys
of the United States of America to PMBC. The obligation of the
City to pay the Base Rentals and Additional Rentals required
under this Article VI and other sections hereof, during the
Lease Term, shall be absolute and unconditional, and payment of
the Base Rentals and Additional Rentals shall not be abated
through accident or unforeseen circumstances. Notwithstanding
any dispute between the City and PMBC, the Trustee, any
Participant or any other person, the City shall, during the
Lease Term, make all payments of Base Rentals and Additional
Rentals when due and shall not withhold any Base Rentals or
Additional Rentals pending final resolution of such dispute
(except to the extent permitted by Sections 8.2 and 9.3 hereof
with respect to certain Additional Rentals), nor shall the City
assert any right of set -off or counterclaim against its
obligation to make such payments required hereunder. No action
or inaction on the part of PMBC or the Trustee shall affect the
City's obligation to pay all Base Rentals and Additional Rentals
(except to the extent provided by Sections 8.2 and 9.3 hereof
with respect to certain Additional Rentals), during the Lease
Term.
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Section 6.5. Expression of the City's Need for the
Equipment; Determinations as to Fair Market Value and Fair
Purchase Price The City hereby declares its current need for
the Equipment. It is hereby declared to be the present
intention and expectation of the City Council that this Lease
will be renewed annually until title to the Equipment is
acquired by the City pursuant to this Lease; but this
declaration shall not be construed as contractually obligating
or otherwise binding the City. The City and PMBC hereby agree
and determine that the Base Rentals hereunder during the
Original Term and any Renewal Term represent the fair value of
the use of the Equipment; and that the Purchase Option Price
represents the fair purchase price of the Equipment. The City
hereby determines that the Base Rentals do not exceed a
reasonable amount so as to place the City under an economic or
practical compulsion to renew this Lease or to exercise its
option to repurchase the Equipment hereunder. In making such
determinations, the City and PMBC have given consideration to
the value of the Equipment, the uses and purposes for which the
Equipment will be employed by the City, the benefit to the City
by reason of the acquisition pursuant to the terms and
provisions of this Lease, the option of the City to purchase the
Equipment, and the expected eventual vesting of title to the
Equipment in the City. The City hereby determines and declares
that the acquisition of the Equipment pursuant to this Lease
would meet the same requirements and standards as would be
necessary if the acquisition of the Equipment were done by the
City other than pursuant to this Lease. The City hereby
determines and declares that the period during which the City
has an option to purchase the Equipment (i.e., the maximum term
of this Lease including all Renewal Terms) does not exceed the
useful life of the Equipment.
Section 6.6. Nonappropriation In the event that the City
Council shall not budget and appropriate, specifically with
respect to this Lease, on or before December 31 of each year,
moneys sufficient to pay all Base Rentals and the reasonably
estimated Additional Rentals coming due for the next ensuing
Renewal Term, an Event of Nonappropriation shall be deemed to
have occurred (provided, however, that the Trustee shall declare
an Event of Nonappropriation on any earlier date on which the
Trustee receives written notice from the City that this Lease
will not be renewed; and provided further that the Trustee may
waive any Event of Nonappropriation which is cured by the City
within a reasonable time if in the judgment of the Trustee such
waiver is in the best interests of the Participants). In the
event that during the Original Term or any Renewal Term, any
Additional Rentals shall become due which were not included in
the current budget of the City, or which exceed the amounts
which were included therefor in the current budget of the City,
then, in the event that moneys are not specifically budgeted and
appropriated to pay such Additional Rentals within 90 days
subsequent to the date upon which such Additional Rentals are
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due, an Event of Nonappropriation shall be deemed to have
occurred, upon notice by the Trustee to the City to such effect
(subject to waiver by the Trustee as hereinbefore provided).
If an Event of Nonappropriation occurs, the City shall not
be obligated to make payment of the Base Rentals or Additional
Rentals or any other payments provided for herein which accrue
after the last day of the Original or Renewal Term during which
such Event of Nonappropriation occurs; provided, however, that
the City shall continue to be liable for Base Rentals and
Additional Rentals allocable to any period during which the City
shall continue to use the Equipment.
The City shall in all events give up possession of the
Equipment by the expiration of the Original or Renewal Term
during which an Event of Nonappropriation occurs. The City and
PMBC hereby acknowledge and agree that any termination of this
Lease shall terminate the City's rights as to the Equipment.
The Trustee, upon the occurrence of an Event of
Nonappropriation, shall be entitled to all moneys then on hand
and being held in all funds created under the Resolution, for
the benefit of the Participants. After the expiration of the
Original or Renewal Term during which an Event of
Nonappropriation occurs, the Trustee may proceed to foreclose on
and sell, lease or assign its interest in the Equipment or any
portion thereof, as provided in Section 7.02 and 7.05 of the
Resolution. All property, funds and rights acquired by the
Trustee by reason of any Event of Nonappropriation as provided
herein, less any moneys due and owing to the Trustee, shall be
held by the Trustee for the benefit of the Participants as set
forth in the Resolution.
Section 6.7. Disposition of Base Rentals Upon receipt by
PMBC of each payment of Base Rentals, PMBC shall apply the
amount of such Base Rentals in the following manner and order:
FIRST, the amount of such payment of Base Rentals
designated and paid as interest under Exhibit B, plus the
amount of any past due interest on the Certificates, shall
be deposited in the Interest Account of the Certificate
Fund.
SECOND, the remaining portion of such payment of Base
Rentals shall be deposited in the Principal Account of the
Certificate Fund.
ARTICLE VII
ACQUISITION OF THE EQUIPMENT
Section 7.1. Acquisition of the Equipment PMBC has
acquired the Equipment and agrees to lease the Equipment to the
City pursuant to this Lease. The City shall cause the Equipment
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to be insured against loss as provided in Section 9.3 hereof
insuring the Trustee's interest in the Equipment, and insuring
PMBC's interest in the Equipment, both subject to Permitted
Encumbrances. Said insurance shall be provided in an amount not
less than the principal amount of the Certificates. The City
shall provide proof of such coverage to PMBC and the Trustee at
such times and in such form as reasonably requested by PMBC or
the Trustee.
ARTICLE VIII
TITLE TO THE EQUIPMENT;
LIMITATIONS ON ENCUMBRANCES
Section 8.1. Title to the Equipment At all times during
the Lease Term, title to the Equipment shall remain in the name
of PMBC, subject to this Lease, the Resolution and any other
Permitted Encumbrances, until foreclosed on or conveyed as
provided in Section 7.02 of the Resolution or Article XII of
this Lease, notwithstanding (i) the occurrence of an Event of
Nonappropriation as provided in Section 6.6 of this Lease or one
or more Events of Default as defined in Section 14.1 of this
Lease; (ii) the occurrence of any event of damage or
destruction, as provided in Article X of this Lease; or (iii)
the violation by PMBC (or by the Trustee as assignee of PMBC
pursuant to the Resolution) of any provision of this Lease.
The City shall have no right, title or interest in the
Equipment or any additions and modifications to or replacements
of any portion of the Equipment, except as expressly set forth
in this Lease.
Section 8.2. No Encumbrance Mortgage or Pledge of
Equipment The City shall not permit any lien to be perfected
to or remain against the Equipment except as provided in the
Agreement; provided that, if the City shall first notify the
Trustee of the intention of the City so to do, the City may in
good faith contest any lien filed or perfected against the
Equipment, and in such event may permit the items so contested
to remain undischarged and unsatisfied during the period of such
contest and any appeal therefrom; provided, however, that during
the prosecution of such contest and appeal and until final
discharge of such lien, the City shall (a) provide a surety bond
in the amount of such lien in accordance with the laws of the
State, or (b) provide such other collateral or surety of payment
as the Trustee may deem acceptable in its sole discretion. PMBC
and the Trustee will cooperate fully with the City in any such
contest, upon the request and at the expense of the City.
Neither PMBC nor, except as provided above, the City, shall
directly or indirectly create, incur, assume or suffer to exist
any mortgage, pledge, lien, charge, encumbrance or claim on or
with respect to the Equipment, except Permitted Encumbrances.
The City shall promptly, at its own expense, take such action as
may be necessary to duly discharge any such mortgage, pledge,
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lien, charge, encumbrance or
shall have created, incurred
promptly, at its own expel
necessary to duly discharge
charge, encumbrance or claim
have created and incurred.
claim not excepted above which it
or suffered to exist. PMBC shall
Lse, take such action as may be
any such mortgage, pledge, lien,
not excepted above which it shall
ARTICLE IX
TAXES, INSURANCE AND OTHER CHARGES
Section 9.1. Modification of the Equipment; Installation
of Furnishings and Machinery of the City The City shall have
the privilege of making substitutions, modifications and
improvements to the Equipment, at its own cost and expense;
provided, however, that such substitutions, modifications and
improvements shall not in any way damage the Equipment or cause
the Equipment to be used for purposes other than lawful
governmental functions of the City or cause the City to violate
its covenants in Section 11.6 hereof; and provided that the
Equipment, improved or altered, upon completion of such
substitutions, modifications and improvements, shall be of a
value not less than the value of the Equipment immediately prior
to the making of substitutions, modifications and improvements.
Section 9.2. Taxes, Other Governmental Charges and Utility_
Charges In the event that the Equipment or any portion thereof
shall, for any reason, be deemed subject to taxation,
assessments or charges lawfully made by a governmental body, the
City shall, during the Lease Term, pay the amount of all such
taxes, assessments and governmental charges then due as
Additional Rentals. With respect to other governmental charges
which may be lawfully paid in installments over a period of
years, the City shall be obligated to provide for Additional
Rentals only for such installments as are required to be paid
during the Original or any Renewal Term. The City shall not
allow any liens for taxes, assessments or governmental charges
to exist with respect to the Equipment or any portion thereof,
or the rentals and revenues derived therefrom or hereunder.
The City may, at the expense and in the name of the City,
in good faith contest any such taxes, assessments and other
charges and, in the event of any such contest, may permit the
taxes, assessments or other charges so contested to remain
unpaid during the period of such contest and any appeal
therefrom unless the Trustee shall notify the City that, in the
opinion of Independent Counsel, by nonpayment of any such items
the security afforded pursuant to the Resolution will be
materially endangered or the Equipment or any portion thereof
will be subject to loss or forfeiture, or PMBC or the Trustee
will be subject to liability, in which event such taxes,
assessments or other charges shall be paid forthwith as
Additional Rentals (provided, however, that such payment shall
not constitute a waiver of the right to continue to contest such
taxes, assessments or other charges).
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Section 9.3. Provisions Regarding Casualty, Public
Liability and Property Damage Insurance Upon the execution and
delivery of this Lease, the City shall, at its own expense,
cause public liability insurance to be carried and maintained
with respect to the activities to be undertaken by and on behalf
of the City in connection with the use of the Equipment. Such
public liability insurance in connection with the Equipment
shall be in an amount not less than the amounts provided in the
Colorado Governmental Immunity Act, article 10 of title 24,
Colorado Revised States, as the same may be hereafter amended.
The public liability insurance required by this Section 9.3 may
be by blanket insurance policy or policies and may have a
deductible clause of an amount not to exceed $150,000 per
occurrence. If the City shall insure against similar risks by
self - insurance or by participation in a self- insurance pool, the
City, at its election, may provide for public liability
insurance with respect to the Equipment, partially or wholly by
means of an adequate self - insurance fund or self - insurance pool
meeting the requirements of law. All insurance provided by the
City shall also insure PMBC and the Trustee, as their interests
may appear.
The City may in its sole discretion, elect not to carry
casualty and property damage insurance on the Equipment. Should
the City elect to provide such insurance, then any such casualty
and property damage insurance policy shall be so written or
endorsed as to make losses payable to the Trustee subject to the
provisions of Section 10.2 and the Agreement, who, along with
the City and PMBC, shall be a co- insured. Each insurance policy
so provided shall contain a provision to the effect that the
insurance company shall not cancel the policy or modify it
materially and adversely to the interest of the Trustee or the
Participants, without first giving written notice thereof to the
City and the Trustee at least 30 days in advance of such
cancellation or modification. All insurance policies issued
pursuant to this Section 9.3, or certificates with respect
thereto, shall be deposited with the Trustee. No agent or
employee of the City shall have the power to adjust or settle
any loss with respect to the Equipment, whether or not covered
by insurance, without the prior written consent of the Trustee.
The consent of PMBC shall not be required for any such
adjustment or settlement.
Section 9.4. Advances In the event that the City shall
fail to pay any Additional Rentals during the Lease Term, the
Trustee may pay such Additional Rentals, which Additional
Rentals, together with interest thereon at the rate of 18% per
annum, the City agrees to reimburse to the Trustee.
ARTICLE X
DAMAGE AND DESTRUCTION
USE OF NET PROCEEDS
Section 10. 1. Damage and Destruction If, during the
Lease Term (i) the Equipment shall be destroyed (in whole or in
part), or damaged by fire or other casualty; or (ii) title to or
the use of all or any portion of the Equipment shall be lost by
reason of a defect in title thereto; then the City shall
continue to be obligated to continue to pay the amounts
specified in Sections 10.2 and 6.2 of this Lease.
Section 10.2. Obligation of the City to Repair and Replace
the Equipment The City shall cause the Net Proceeds of any
insurance policies made available by reason of any occurrence
described in Section 10.1 hereof, to be deposited in a separate
trust fund with the Trustee. All Net Proceeds so deposited
shall, at the option of the City, be applied by the City to the
prompt repair, restoration, modification, improvement or
replacement of the Equipment. The balance of any such Net
Proceeds remaining after such repair, restoration, modification,
improvement or replacement has been completed, or in the event
the City decides not to proceed with such repair, restoration,
modification, improvement or replacement, as provided in Section
10.3, shall be deposited into the Extraordinary Redemption Fund.
Any repair, restoration, modification, improvement or
replacement paid for in whole or in part out of such Net
Proceeds shall be the property of PMBC, subject to this Lease,
the Agreement and the Resolution, and shall be included as part
of the Equipment under this Lease, the Agreement and the
Resolution.
Section 10.3. Insufficiency of Net Proceeds; Discharge of
the Obligation of the City to Repair or Replace Equipment If
the Net Proceeds (plus any amount withheld therefrom by reason
of any deductible clause) shall be insufficient to pay in full
the cost of any repair, restoration, modification, improvement
or replacement of the Equipment which the City has decided at
its option to perform under Section 10.2 of this Lease, the City
shall elect to proceed under any of the following options:
(a) The City may at its option decide not to proceed
with such remaining work, in which event the balance of the
Net Proceeds shall be deposited into the Extraordinary
Redemption Fund.
(b) The City may complete the work and pay any cost
in excess of the amount of the Net Proceeds, and the City
agrees that, if by reason of any such insufficiency of the
Net Proceeds, the City shall make any payments pursuant to
the provisions of this Section 10.3(b), the City shall not
be entitled to any reimbursement therefor from PMBC, the
Trustee or the Participants, nor shall the City be entitled
to any diminution of the Base Rentals and Additional
Rentals payable under Section 6.2 of this Lease.
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(c) The City may apply the Net Proceeds of such
insurance policies to the payment of the Purchase Option
Price, in accordance with Article XII of this Lease. In
the event of an insufficiency of the Net Proceeds for such
purpose, the City shall pay such amounts as may be
necessary to equal the Purchase Option Price; and in the
event the Net Proceeds shall exceed the Purchase Option
Price, such excess shall be paid to or retained by the
City.
Section 10.4. Cooperation of Lessor PMBC shall cooperate
fully with the City and the Trustee in filing any proof of loss
with respect to any insurance policy or performance bond
covering the events described in Section 10.1 of this Lease, in
the prosecution or defense of any prospective or pending
condemnation proceeding with respect to the Equipment or any
portion thereof and hereby assigns to the Trustee any interest
it may have in such policies or rights of action for such
purposes. In no event shall PMBC voluntarily settle, or consent
to the settlement of, any proceedings arising out of any
insurance claim or prospective or pending condemnation
proceeding with respect to the Equipment or any portion
thereof, without the written consent of the Trustee and the
City.
ARTICLE XI
DISCLAIMER OF WARRANTIES; OTHER COVENANTS
Section 11.1. Disclaimer of Warranties NEITHER PMBC, THE
TRUSTEE NOR THE PARTICIPANTS MAKE ANY WARRANTY OR
REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE,
DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OR FITNESS FOR USE OF THE EQUIPMENT OR ANY OTHER
REPRESENTATION OR WARRANTY WITH RESPECT TO THE EQUIPMENT. The
City hereby acknowledges and declares that the City is solely
responsible for the operation and maintenance of the Equipment
during the Lease Term, and that neither PMBC, the Trustee nor
the Participants has any responsibility therefor. In no event
shall PMBC, the Trustee or the Participants be liable for any
direct or indirect, incidental, special or consequential damage
in connection with or arising out of this Lease or the
existence, furnishing, functioning or use by the City of any
item, product or service provided for herein.
Section 11.2. Further Assurances and Corrective
Instruments PMBC and the City agree that they will, from time
to time, execute, acknowledge and deliver, or cause to be
executed, acknowledged and delivered, such supplements hereto
and such further instruments as may reasonably be required for
correcting any inadequate or incorrect description of the
Equipment hereby leased or intended so to be, or for otherwise
carrying out the intention hereof.
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Section 11. 3. Lessor, City and Trustee Representatives
Whenever under the provisions hereof the approval of PMBC, the
City or the Trustee is required to take some action at the
request of the other, unless otherwise provided, such approval
or such request shall be given for PMBC by a Lessor
Representative, for the City by the City Representative, and for
the Trustee by the Trustee Representative, and PMBC, the City
and the Trustee shall be authorized to act on any such approval
or request.
Section 11.4. Compliance with Requirements During the
Lease Term, the City, PMBC and the Trustee shall observe and
comply promptly with all current and future orders of all courts
having jurisdiction over the Equipment or any portion thereof,
and all current and future requirements of all insurance
companies writing policies covering the Equipment or any portion
thereof.
Section 11.5. City Acknowledgment of the Resolution and
the Certificates The City acknowledges and agrees to the terms
of the Resolution and agrees to be bound thereby. The City
further acknowledges and agrees to the assignment by PMBC to the
Trustee, pursuant to the Resolution, of all rights, title and
interest of PMBC in, to and under this Lease (except the rights
of PMBC under Sections 13.3 and 14.3 of this Lease), and to the
delegation by PMBC to the Trustee, pursuant to the Resolution of
certain duties of PMBC under this Lease. The City acknowledges,
directs and agrees to the issuance and sale of the Certificates
pursuant to the Resolution. The City acknowledges and approves
the form of the Certificates contained in the Resolution.
Section 11.6. Tax Covenants PMBC and the City hereby
covenant to comply with all requirements of the Internal Revenue
Code of 1986, as amended (the "Code ") that must be satisfied
subsequent to the issuance of the Certificates in order that the
interest thereon be, or continue to be, excluded from gross
income and from alternative minimum taxable income, for purposes
of federal income taxation, unless PMBC and the City obtain an
opinion of nationally recognized municipal bond counsel to the
effect that compliance with such restrictions is not necessary
to preserve such exclusion.
Section 11.7. Designation of the Certificates as Qualified
Tax - Exempt Obligations The City represents that it reasonably
anticipates to issue (or has issued), together with governmental
entities which derive their issuing authority from the City or
are subject to substantial control by the City, including
without limitation, PMBC, not more than an aggregate total of
$10,000,000 of governmental or qualified section 501(c)(3)
organization bonds (as defined in the Code) during calendar year
1991. The City recognizes that governmental bonds include
tax - exempt obligations such as notes, leases, loans and
warrants. The City and PMBC hereby designate the Certificates
as qualified tax - exempt obligations within the meaning of
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Section 265 of the Code allowing banks, thrift institutions and
other financial institutions to avoid the loss of 100% of any
otherwise available interest deduction in direct proportion to
such institutions' tax - exempt holdings.
ARTICLE XII
CONVEYANCE OF THE EQUIPMENT
Section 12.1. Conveyance of the Equipment PMBC shall
transfer and convey to the City the Equipment (or, in the case
of (c) below, any portion of the Equipment to which PMBC may
then hold title), in the manner provided for in Section 12.2 of
this Lease; provided, however, that prior to such transfer and
conveyance:
(a) The City shall have paid the then applicable
Purchase Option Price and the obligations under the
Resolution shall have been discharged as provided in
Article VI of the Resolution; or
(b) The City shall have paid all Base Rentals set
forth in Exhibit B hereto, for the Original Term and all
Renewal Terms, including the final Renewal Term, and all
then current Additional Rentals required hereunder; or
(c) The obligations under the Resolution shall have
been discharged as provided in Article VI of the
Resolution.
The City is hereby granted the option to terminate the
Lease Term and to purchase the Equipment upon payment by the
City of the then applicable Purchase Option Price and upon
discharge of the obligations under the Resolution as provided in
Article VI of the Resolution.
Section 12.2. Manner of Conveyance At the closing of any
purchase or other conveyance of the Equipment pursuant to
Section 12.1 of this Lease, PMBC and the Trustee shall execute
and deliver to the City all necessary documents releasing this
Lease, the Agreement and the Resolution, and assigning,
transferring and conveying good and marketable title to the
Equipment, as the Equipment then exists, subject to the
following: (i) Permitted Encumbrances, other than this Lease,
the Agreement and any UCC financing statements, indicating the
City or PMBC as the debtor and PMBC or the Trustee as secured
party, filed to perfect any security interests granted under the
Lease or the Agreement; (ii) all liens, encumbrances and
restrictions created or suffered to exist by PMBC or the Trustee
as required or permitted by this Lease, the Resolution or the
Agreement or arising as a result of any action taken or omitted
to be taken by PMBC or the Trustee as required or permitted by
this Lease or the Resolution; and (iii) any lien or encumbrance
created by action of the City.
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II i1 I I II!111
Section 12.3 Escrowed Bill of Sale In order to
facilitate the enforcement by the City of the obligation of PMBC
to convey the Equipment to the City under the circumstances
provided in Section 12.1 of this Lease, PMBC shall deposit in
escrow with the Trustee, concurrently with the delivery of the
Certificates to the original Participants, a Bill of Sale as
provided in Article VI of the Resolution or payment of all Base
Rentals or upon discharge of the Resolution as provided in
Section 12.1(c) of this Lease, date and release the Bill of Sale
to the City.
ARTICLE XIII
ASSIGNMENT, SUBLEASING,
INDEMNIFICATION, MORTGAGING AND SELLING
Section 13.1. Assignment by Lessor; Replacement of Lessor
Certain of the rights of PMBC under this Lease, including rights
to receive and enforce payments hereunder (except the rights of
PMBC under Sections 13.3 and 14.3 of this Lease), have been
conditionally assigned to the Trustee pursuant to the
Resolution. In the event of any bankruptcy, insolvency, or
other similar proceeding as to PMBC, or in any other event which
in the judgment of the Trustee materially impairs the ability of
PMBC to serve as Lessor under this Lease or as grantor under the
Resolution, the Trustee may replace PMBC with such other entity
as it deems appropriate. In any such event PMBC shall cooperate
with the Trustee in conveying title to the Equipment and any and
all other right, title and interest of PMBC in, to and under
this Lease and the Resolution to such successor entity as the
Trustee may designate. Any costs or expenses incurred by or
charged to PMBC at the request of the Trustee and in the course
of cooperating with the Trustee pursuant to the provisions of
this Section shall be paid by the City.
Section 13.2. Assignment and Subleasing by the City This
Lease may not be assigned by the City for any reason. However,
the Equipment may be subleased, as a whole or in part, by the
City, but without the necessity of obtaining the consent of
PMBC, the Trustee or any Participants; subject, however, to each
of the following conditions:
(a) The Equipment may be subleased, in whole or in
part, only to an agency or department or political
subdivision of the State, or to another entity or entities
if, in the opinion of nationally recognized bond counsel
acceptable to the Trustee, such sublease will not cause the
City to violate its covenants in Section 11.6 hereof;
(b) This Lease, and the obligations of the City
hereunder, shall, at all times during the Original and any
Renewal Terms, remain obligations of the City, and the City
shall maintain its direct relationships with PMBC and the
Trustee, notwithstanding any sublease;
-23-
(c) The City shall furnish or cause to be furnished
to PMBC and the Trustee a copy of any sublease agreement;
and
(d) No sublease by the City shall cause the Equipment
to be used for any purpose which would cause the City to
violate its covenants in Section 11.6 hereof, or which
would violate the Constitution, statues or laws of the
State or the Charter.
Section 13.3. Release and Indemnification Covenants To
the extent permitted by law, the City shall and hereby agrees to
indemnify and save PMBC and the Trustee harmless against and
from all claims, by or on behalf of any person, firm,
corporation or other legal entity arising from the conduct,
management or ownership of, or from any work or thing done on,
the Equipment during the Lease Term, from: (i) any condition of
the Equipment; and (ii) any act of negligence of the City or of
any of its agents, contractors or employees or any violation of
law by the City or breach of any covenant or warranty by the
City hereunder. To the extent permitted by law, the City shall
indemnify and save PMBC and the Trustee harmless from any such
claim arising as aforesaid from (i) or (ii above, or in
connection with any action or proceeding broug t thereon and,
upon notice from PMBC or the Trustee, shall defend PMBC or the
Trustee, as the case may be, and pay the cost of such defense in
any such action or proceeding.
Section 13.4. Restrictions on Additional Liens or Sale of
Equipment The City and PMBC agree that, except for: (i) the
conditional assignment by PMBC of certain rights under this
Lease and the Resolution to the Trustee; (ii) any exercise by
the Trustee or PMBC of the remedies afforded by this Lease, the
Agreement or the Resolution; (iii) the right of the Trustee to
replace PMBC pursuant to Section 13.1 of this Lease and any
conveyances required by reason of such replacement; (iv) the
right of the City to sublease all or a portion of the Equipment
pursuant to Section 13.2 of this Lease; (v) any conveyance to
the City pursuant to Article XII of this Lease; (vii) any
substitutions, modifications and improvements of the Equipment
pursuant to Section 9.1 of this Lease; neither PMBC nor the City
will encumber, sell, assign, transfer or convey the Equipment or
any portion thereof during the Lease Term.
ARTICLE XIV
EVENTS OF DEFAULT AND REMEDIES
Section 14.1. Events of Default Defined Any one of the
following shall be "Events of Default" under this Lease:
(a) Failure by the City to pay any Base Rentals or
Additional Rentals when due during the Lease Term; or
-24-
(b) Failure by the City to give up possession of the
Equipment by the expiration of the Original or Renewal Term
during which an Event of Nonappropriation occurs; or
(c) Failure by the City to observe and perform any
covenant, condition or agreement on its part to be observed
or performed, other than as referred to in (a) or (b), for
a period of 45 days after written notice, specifying such
failure and requesting that it be remedied shall be given
to the City by the Trustee unless the Trustee shall agree
in writing to an extension of such time prior to its
expiration; provided, however, that if the failure stated
in the notice cannot be corrected within the applicable
period, the Trustee shall not unreasonably withhold its
consent to an extension of such time if corrective action
shall be instituted by the City within the applicable
period and diligently pursued until the default is
corrected.
The foregoing provisions of this Section 14.1 are subject to the
following limitations: (i.) the City shall be obligated to pay
the Base Rentals and Additional Rentals only during the Lease
Term, except as otherwise expressly provided in this Lease; and
(iij if, by reason of Force Ma'e� the City shall be unable in
who a or in part to carry out any agreement on its part herein
contained, other than the obligations on the part of the City
contained in Article VI of this Lease, the City shall not be
deemed in default during the continuance of such inability. The
City agrees, however, to remedy, as promptly as legally and
reasonably possible, the cause or causes preventing the City
from carrying out its agreement; provided that the settlement of
strikes, lockouts and other industrial disturbances shall be
entirely within the discretion of the City.
Section 14.2. Remedies on Default Whenever any Event of
Default referred to in Section 14.1 of this Lease shall have
happened and be continuing, the Trustee may exercise all rights
conferred upon it by Article VII of the Resolution and by the
Agreement, subject to the limitations therein described.
Section 14.3. Agreement to Pay Attorneys' Fees and
Expenses In the event that either party hereto shall default
under any of the provisions hereof and the nondefaulting party
shall employ attorneys or incur other expenses for the
collection of Base Rentals and Additional Rentals, or the
enforcement of performance or observance of any obligation or
agreement on the part of the defaulting party herein contained,
the defaulting party agrees that it shall pay on demand therefor
to the nondefaulting party the fees of such attorneys and such
other expenses so incurred by the nondefaulting party, to the
extent that such attorneys' fees and expenses may be determined
to be reasonable by a court of competent jurisdiction.
-25-
Section 14.4. Waiver of Appraisement, Valuation, Stay and
Extension PMBC and the City agree, to the extent permitted by
law, that in the case of a termination of the Lease Term by
reason of an Event of Nonappropriation or an Event of Default,
neither PMBC nor the City nor any one claiming through or under
either of them shall or will set up claim or seek to take
advantage of any appraisement, valuation, stay or extension laws
now or hereafter in force in order to prevent or hinder the
enforcement of the Resolution, the Agreement or this Lease; and
PMBC and the City, for themselves and all who may at any time
claim through or under either of them, each hereby waives, to
the full extent that it may lawfully do so, the benefit of all
such laws; provided, however, that Lessor, for itself and all
who may at any time claim through or under PMBC, shall retain
all rights of redemption.
ARTICLE XV
MISCELLANEOUS
Section 15.1. Notices All notices, certificates or other
communications hereunder shall be sufficiently given and shall
be deemed given when delivered or mailed by certified or
registered mail, postage prepaid, as follows: if to the City,
City of Pueblo, Colorado, One City Hall Place, Pueblo, Colorado
81003, Attention: City Manager; if to PMBC, City of Pueblo,
Colorado Municipal Building Corporation, One City Hall Place,
Pueblo, Colorado 81003, Attention: President; and if to the
Trustee, The Pueblo Bank and Trust Company, 301 West Fifth
Street, Pueblo, Colorado 81003, Attention: Corporate Trust
Department. The City, PMBC and the Trustee may, by written
notice, designate any further or different addresses to which
subsequent notices, certificates or other communications shall
be sent.
Section 15.2. Binding Effect This Lease shall inure to
the benefit of and shall be binding upon PMBC and the City and
their respective successors and assigns, subject, however, to
the limitations contained in Article XIII of this Lease.
Section 15.3. Amendments, Changes and Modifications
Except as otherwise provided in this Lease or the Resolution,
subsequent to the issuance and delivery of the Certificates to
the initial owner or owners thereof and prior to the discharge
of the obligations under the Resolution, this Lease may not be
effectively amended, changed, modified or altered without the
written consent of the Trustee, as provided in the Resolution.
Section 15.4. Amounts Remaining in Funds It is agreed by
the parties hereto that any amounts remaining in the Certificate
Fund, the Extraordinary Redemption Fund, the Acquisition Fund or
any other fund or account created under the Resolution upon
termination of the Lease Term, and after payment in full of the
Certificates (or provision for payment thereof having been made
-26-
in accordance with the provisions of Article
Resolution) and fees and expenses of the Trustee in
with this Lease, shall belong to and be paid to the
Trustee as an overpayment of Base Rentals.
VI of the
accordance
City by the
Section 15.5. Net Lease This Lease shall be deemed and
construed to be a "net lease," and the City shall pay absolutely
net during the Lease Term, the Base Rentals, Additional Rentals
and all other payments required hereunder, free of any
deductions, and without abatement, deduction or setoff (other
than credits against Base Rentals expressly provided for in this
Lease).
Section 15.6. Payments Due on Holidays If the date for
making any payment or the last day for performance of any act or
the exercising of any right, as provided in this Lease, shall be
a legal holiday or a day on which banking institutions in the
City in which the principal corporate trust office of the
Trustee is located are authorized by law to remain closed, such
payment may be made or act performed or right exercised on the
next succeeding day that is not a legal holiday or a day on
which such banking institutions are not authorized by law to
remain closed with the same force and effect as if done on the
nominal date provided in this Lease.
Section 15.7. Severability In the event that any
provision of this Lease, other than the requirement of the City
to pay Base Rentals and the requirement of PMBC to provide quiet
enjoyment of the Equipment and to convey the Equipment to the
City under the conditions set forth in Article XII of this
Lease, shall be held invalid or unenforceable by any court of
competent jurisdiction, such holding shall not invalidate or
render unenforceable any other provision hereof.
Section 15.8. Execution in Counterparts This Lease may
be simultaneously executed in several counterparts, each of
which shall be an original and all of which shall constitute but
one and the same instrument.
Section 15.9. Applicable Law This Lease shall be
governed by and construed in accordance with the laws of the
State of Colorado, without regard to conflict of laws
principles.
Section 15.10. Captions The captions or headings herein
are for convenience only and in no way define, limit or describe
the scope or intent of any provisions or sections of this Lease.
IN WITNESS WHEREOF, PMBC has executed this Lease in its
corporate name with its corporate seal hereunto affixed and
attested by its duly authorized officer; and the City has caused
this Lease to be executed in its corporate name and the seal of
the City affixed and attested by duly authorized officer
thereof. All of the above are effective as of the date first
above written.
-27-
[SEAL]
Attest
Secre ry
[CITY SEAL]
Attest: C -, \ C
'k -
City, "CTer
CITY OF PUEBLO, COLORADO
MUNICIPAL BUILDING
CORPORATION, as Lessor
By: -�,,r r) e .�-� ,.
President
CITY OF PUEBLO, COLORADO, as
Lessee
B .
Fresi ent o �t City Council
Approved as to Form
City Attor� --
mm
STATE OF COLORADO )
CITY OF PUEBLO ) ss.
The foregoing instrument was acknowledged before me this
23rd day of Ma w_ 1991, by Lewis A. nuialey
as President, and by
the City of Pueblo, Co ora o Municipa Bui din s Co rporatio n of
Colorado nonprofit corporation.*
g rporation, a
WETNESS my hand and official seal.
[mn -
Notary Pu c
My Commission expires:
-29-
Document No. 9
SIGNATURE IDENTIFICATION CERTIFICATE
I, the undersigned, Billy G. Martin , of Pueblo,
Colorado, do hereby certify that I am personally acquainted with
Lewis A. Quigley, President, and Fay B. Kastiic, Secretary, of
City of Pueblo, Colorado Municipal Building Corporation, Pueblo
County, Colorado ( "PMBC "); that I know the above - mentioned
officers were the President and Secretary, respectively, of PMBC
upon the date of the execution and delivery of that certain
series of PMBC's Certificates of Participation dated May 23,
1991; that I am acquainted with the signatures of said officers
and know that the manual or facsimile signatures appearing on
said Certificates are the manual or facsimile signatures of said
officers, respectively; and that said officers have to this
certificate attached their respective signatures as follows:
CITY OF PUEBLO, COLORADO MUNICIPAL
BUILDING CORPORATION
Pueblo County, Colorado
resiaen
Secret ry
SIGNED AND CERTIFIED this 2 3rd day of May , 1991.
YL-b -/)3 69q�on
Document No. 10
CORPORATION GENERAL AND NO- LITIGATION CERTIFICATE
The undersigned officers of the City of Pueblo, Colorado
Municipal Building Corporation ( "PMBC ") being on the date of
this certificate about to cause to be issued Certificates of
Participation, dated May 23, 1991, in the principal amount of
$168,600 (the "Certificates "), and being about to receive the
consideration therefor, hereby certify that:
1. They are the duly elected, qualified, sworn and acting
President and Secretary, respectively, of PMBC.
2. From April 16, 1991, up to and including the date
hereof, the followfng have been and now are the duly elected or
appointed, qualified and acting officers and members of the
Board of Directors of PMBC:
Lewis A. Quigley
John A. Califano
Fay B. Kastelic
President
Vice President
Secretary /Treasurer
3. PMBC was duly created and organized as a nonprofit
corporation of the State of Colorado (the "State ") in accordance
and in strict compliance with the laws of the State; there are
no facts within or knowledge which would invalidate its
organization.
4. There is no litigation pending or threatened with
reference to the creation of PMBC, or in any way affecting the
authority for or validity of the creation of PMBC or its
existence.
5. There is no litigation pending or threatened with
reference to the issuance of the Certificates pursuant to the
Resolution of PMBC dated May 7, 1991 (the "Resolution "), the
Security and Trust Agreement dated May 23, 1991 between PMBC and
the Pueblo Bank and Trust Company (the "Agreement " }, and the
Equipment Lease Purchase Agreement dated May 23, 1991 by and
between PMBC and the City of Pueblo, Colorado (the "Lease "), or
in any way affecting the authority for or the validity of the
Certificates, the Resolution, the Agreement or the Lease, nor
does anything exist to hinder or prevent the issuance of the
Certificates.
6. PMBC is in full compliance with all requirements,
terms, conditions and provisions of the laws of Colorado and its
Constitution, as well as the Resolution, the Agreement and the
Lease, insofar as the same relate to the creation and
establishment of PMBC or the authorization, sale and issuance of
and security for the Certificates; there are no conditions
precedent to the issuance of the Certificates which have not
been met or have not occurred.
Document No. 11
CERTIFICATE AND RECEIPT OF CORPORATION
I, Lewis A. Quigley, as President of the City of Pueblo,
Colorado Municipal Building Corporation, a Colorado nonprofit
corporation ( "PMBC "), do hereby certify and declare that I am
President of the Corporation, duly elected, qualified and acting
as such as of the date hereof, and that:
1. PMBC is duly organized as a nonprofit corporation
existing under and by virtue of the laws of the State of
Colorado. PMBC is lawfully empowered, fully authorized and
qualified to execute and accept the duties imposed by its
Resolution adopted May 7, 1991 providing for issuance of its
Certificates of Participation identified herein (the
"Resolution "), the Equipment Lease Purchase Agreement, dated May
23, 1991, by and between PMBC and the City of Pueblo, Colorado
(the "Lease ") and the Security and Trust Agreement dated may 23,
1991, by and between PMBC and The Pueblo Bank and Trust Company,
as Trustee (the "Agreement "). PMBC has taken all necessary
corporate action to authorize the adoption of the Resolution and
the execution and acceptance of the Lease and the Agreement.
2. The execution, delivery and performance by PMBC of the
Resolution, the Lease and the Agreement, do not and will not
contravene any law or governmental rule, regulation, judgment,
decree, writ, injunction or order binding on PMBC or the
.Articles of Incorporation or Bylaws of PMBC or contravene the
provisions of, or constitute default under, any indenture,
mortgage, contract or other agreement or instrument to which
PMBC is a party or by which PMBC is bound or to which any of its
properties or assets are subject.
3. The Resolution, the Lease and the Agreement have been
duly signed, acknowledged and delivered on behalf of PMBC by
authorized officers of PMBC, and the corporate seal of PMBC has
been affixed thereto. Each of such officers was duly elected,
appointed, qualified and acting as such at the respective times
of such signings and*�deliveries, and on the dates thereof was
authorized to perform such acts, and the signatures set forth in
Paragraph 6 hereof are correct specimens of their respective
signatures.
4. Pursuant to the Agreement, PMBC has caused to be
executed and delivered to the original purchasers thereof,
$168,600 aggregate principal amount of Certificates of
Participation dated May 23, 1991, (the "Certificates "), issued
in fully registered form.
5. The Certificates so executed bear interest and mature
as provided in and are substantially in the form called for by
the Resolution.
6. The Resolution, the Lease and the Agreement were
executed on behalf of PMBC by the persons whose names and
offices appear below, and each of such persons was at the time
of such execution and now is the duly elected, qualified and
acting incumbent of his or her respective office, and the
signature appearing after the name of each of said persons is a
true and correct specimen of that person's genuine signature.
NAME OFFICE
Lewis A. Quigley President
Fay B. Rastelic Secretary
7. PMBC has all requisite power ano/ authority to adopt
the Resolution and to enter into the Lease and the Agreement.
8. There is no litigation pending or threatened against
PMBC relating in any way to its status or to the authorization,
issuance or delivery or the legality of any of the Certificates,
and that so far as is known, nothing exists to hinder or prevent
PMBC from causing said Certificates to be issued.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
the seal of PMBC this 23rd day of May, 1991.
CITY OF PUEBLO, COLORADO MUNICIPAL
BUILDING AUTHORITY
B :-
President
{CORPORATION SEAL}
I►AM
Document No. 12
REQUEST AND AUTHORIZATION
FROM PMBC TO TRUSTEE
TO DELIVER CERTIFICATES
May 23, 1991
Pueblo Bank and Trust Company
301 West Fifth Street
Pueblo, Colorado 81003
RE: City of Pueblo, Colorado Municipal Building Corporation
Certificates of Participation
$168,600
Ladies and Gentlemen:
The undersigned, President of the City of Pueblo, Colorado
Municipal Building Corporation ( "PMBC "), acting pursuant to the
Security and Trust Agreement dated May 23, 1991, between PMBC
and Pueblo Bank and Trust Company, as Trustee, (the "Trustee "),
hereby delivers to you, $168,600, in aggregate principal amount
of PMBC Certificates of Participation (the "Certificates "),
dated as of May 23, 1991. You hereby are requested and
authorized to deliver the Certificates on behalf of PMBC to John
Lainson, representing Boettcher & Company, the placement agent,
for the purchasers of the Certificates.
CITY OF PUEBLO, COLORADO MUNICIPAL
IF BUILDING CORPORATION
{S E A L}
By: I 1,1
ATTEST: rest ent"
By
Secretary
Receipt of the foregoing and accompanying Certificates are
hereby acknowledged.
THE PUEBLO BANK AND TRUST COMPANY
By:
Date:
Document No. 13
CITY GENERAL AND NO- LITIGATION CERTIFICATE
The undersigned officials of the City of Pueblo, Colorado
(the "City ") being on the date of this certificate about to
enter into the Equipment Lease Purchase Agreement with the City
of Pueblo, Colorado Municipal Building Corporation ( "PMBC "),
dated May 23, 1991 (the "Lease "), hereby certify that:
1. They are the duly elected, qualified, sworn and
acting, President of the City Council and City Clerk,
respectively, of the City.
2. The following now are the duly elected or appointed,
qualified and acting officials and members of the City Council
of the City:
Michael A. Occhiato
John A. Califano
Samuel J. Corsentino
Gilbert C. Garbiso
Kenneth Hunter
Fay B. Kastelic
Howard Whitlock
Marian D. Mead
Billy G. Martin
President of the City Council
Councilmember
Councilmember
Councilmember
Councilmember
Councilmember
Councilmember
City Clerk
Director of Finance
3. The City was duly created and organized as a public
corporation and instrumentality of the State of Colorado (the
"State ") in accordance and in strict compliance with the laws of
the State; there are no facts within our knowledge which would
invalidate its organization.
4. There is no reason within our knowledge why the City
may not enter into the Equipment Lease Purchase Agreement dated
May 23, 1991 (the "Lease "), by and between the City and PMBC.
5. No litigation of any nature is now pending or
threatened:
(a) Restraining or enjoining the execution of the
Lease by the City and assuming the obligations thereunder;
(b) In any manner questioning the authority or
proceedings and authority for the execution of the Lease;
(c) Affecting in any manner, directly or indirectly,
the validity of the Lease or any provisions made,
authorized or convenanted and agreed to be made;
(d) Questioning or contesting the corporate existence
or boundaries of the City, or the titles of the officials
or any of them, to their respective offices; and
(e) Which, if adversely determined, could adversely
affect the financial position of the City (as Lessee) or
the transactions contemplated by the Lease and the
underlying financing documents.
6. No ordinance, resolution, or other proceedings or
authority for the execution of the Lease, has or have been
repealed, rescinded, revoked, modified, changed or altered in
any manner.
IN WITNESS WHEREOF, we have hereunto set our hands and the
official seal of the City this 23rd day of May, 1991.
{S E A L}
Pres1dent o City Council
71ty(Cleric
-2-
Document No. 20
BILL OF SALE
KNOW ALL MEN BY THESE PRESENTS, That the City of
Pueblo, Colorado Municipal Building Corporation, of the County
of Pueblo, State of Colorado (Seller), for and in consideration
of good and valuable consideration, to it in hand paid, at or
before the ensealing or delivery of these presents by the City
of Pueblo, Colorado (Buyer), the receipt of which is hereby
acknowledged, has bargained and sold, and by these presents does
grant and convey unto the said Buyer, its successors and
assigns, the following property, goods and chattels, to wit:
50 - 1991 Hyundai Gas Cars including:
Executive Suntop, Sweater Baskets,
Full Wheel Covers
10 - New Tires and Wheels
2 - 3/4 inch Discharge Tenaka Sump Pumps
located at Walkingstick Golf Course, Pueblo, Colorado.
To have and to hold the same unto the said Buyer, its
successors and assigns, forever. The said Seller covenants and
agrees to and with the Buyer, its successors and assigns, to
WARRANT AND DEFEND the sale of said property, goods and
chattels, against all and every person or persons whomever.
IN WITNESS WHEREOF, the Seller has executed this Bill
of Sale this 23rd day of May, 1991.
CITY OF PUEBLO, COLORADO MUNICIPAL
BUILDING CORPORATION
By
P resident
STATE OF COLORADO )
ss.
COUNTY OF PUEBLO )
The foregoing instrument was acknowledged before me
this 23rd day of May, 1991.
My commission expires: +n^ >��'t�2,�ga
Witness my hand and Of icia sea
Notary Pudic
G
8038
Farm Information Return for Tax - Exempt Governmental Obligations 3497
(Rev. October 1989) 1 Under Section 149(e)
0M6 ,14o '15 J720
Department of the Treasury 111 See separate Instructions
Internal Revenue Semce (Use Form 8038 -GC it the issue price is under 5100.000) Fop !es 5 -31 - 32
Report Author
1 Issuer's name Check box if Amended Return P- 1
City of Pueblo, Colorado N.unici.pal Building Corporation 2 Issuer's employer identification number
3 Number and street
1 City Hall Place 14 Report number
5 City or town, state, and ZIP code G 1 9
Pueblo Colorado 81003 16 Oate of issue
7 Name of Issue May 23, 1991
Certificates of Participation I 8 CUSIPNumber
N/A Type of Issue (check box(es) that applies and enter the Issue Price)
9 Check box if obligations are tax or other revenue anticipation bonds ►
10 Check box if obligations are in the form of a lease or installment sale ► 22
11 ❑ Education . .
12 ❑ Health and hospital . . . . . . . . . '
13 ❑ Transportation . . • • . . . . . . . . . . . . . . . . . ' ' ' ' '
14 C1 Public safety . . . . . . . . ,
15 ❑ Env (including sewage bonds) . . . . . . . . . . . . .
16 ❑ Housing . . . . . . . . . . .
17 ❑ Utilities . . . . . . . . . . . . . . . . . . . . . . i
18 Other. Describe (see Instructions) ► RPC`YP rnn j
Description of Obligations
19 Final maturity
20 Entire issue
Uses of Ori
21
22
23
24
25
26
27
28
(a) (b) (e) ( Id) (el
4latunry d ate Interest ate I tated redemotion I We+grrtec
ue once p. � — 3t maturity avPrAvo ^gar
inal Proceeds of Bond Issues (including under writers' discoun
Proceeds used for accrued interest . . . . . . . . . . . . .
Issue price of entire issue (enter line 20c) . . . . . ,
Proceeds used for bond issuance costs ( including underwriters' discount) .
Proceeds used for credit enhancement .
Proceeds allocated to reasonably required reserve or replacement fund
Proceeds used to refund prior issues . . . . . .
Total (add lines 23, 24, 25, and 26) . or . . . , . . .
. . . . . . . . 21 '
1 23 1 11
00 00 ur..,,r.i
( iii
� %j. /�%/
Nonrefundin proceeds of the i Z and enter amount here) 2
'issue subtract line 27 from line 2 2 11, 400 0
8
Description of Refunded Bonds (complete this part only for refunding bonds)
29 Enter the remaining weighted average maturity of the bonds to be refundeo , 10. years
30 Enter the last date on which the refunded bonds will be called ►
31 Enter the dates) the refunded bonds were issued ►
Miscellaneous
32 Enter the amount of the state volume cap allocated to the issue . . . . . lip
33 Enter the amount of the bonds designated by the issuer uncer section 2 (small
issuer exception) . . . . ► 168 600 .00
34 Pooled financ:ngs: `
a Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental un:;; P.
b Check box if this issue is a loan made from the proceeds of another tax- exerrot issue ► and e nter --e rarre of - ^e
issuer 1*
ar.0 tie ^_ate of the issue >
Urde! oerawes JI :e11urv.: oec:are :mat i nave examined tmis return ant acco�lpanyrS ScnepWe3 and statements. art ^e 7e5 : :' '� - ^, .v�o.
! :heY are true. correct. aro :omolete. 7ge ]rr, : e'
I
I
Please ,.
Sign
^- ^ _7 23 L uiale n
Here ! „gnature or ptt�ce -- r —� �' ._._._�.___ a �' � Lewi wls c3 � prasl�.e
:ate -ype or onnt - are ane
ror raoerworx deduction Act Notice. see page I of the Instructions.
Issue once
(n
interest
I
Net
Yis d
lost
—
% I
%
3033 -G _ - .
(''.''.te :•text ?age is .1497 -3.:
MINUTES OF' A SPECIAL MEETING
OF THE CITY OF PUEBLO, COLORADO
MUNICIPAL BUILDING CORPORATION
A special meeting of the Board of Directors of the City of
Pueblo, Colorado Municipal Building Corporation was held at #1
City Hall Place, Pueblo, Colorado on the 7th day of May, 1991.
Directors Present: John A. Califano
Fay B. Kastelic
Directors Absent:
Others Present:
Billy G. Martin
Lewis A. Quigley
Thomas E. Jagger
A motion was made by John A. Califano and seconded by Fay B.
Kastelic that the Minutes of the April 16, 1991 meeting be
approved. It was unanimously voted to approve the Minutes.
A motion was made by John A. Califano and seconded by Fay B.
Kastelic to rescind the resolution presented and unanimously
approved at the annual meeting of April 15, 1991 regarding the
acquisition and financing of certain equipment (golf carts) for
the City of Pueblo, Colorado. A revised resolution, regarding
the same and attached hereto, was presented to the Directors by
Thomas E. Jagger. John A. Califano moved that the revised
resolution be approved and adopted, Fay B. Kastelic seconded the
motion, and all voted in favor.
There being no further business to come before the meeting, upon
motion duly made, seconded and unanimously carried, the meeting
was adjourned.
DATED this 7th day of May, 1991.
_ 1
Secre ary -Fay B. Kastelic
WAIVER OF NOTICE
The undersigned, constituting all of the members of the Board
of Directors of the City of Pueblo, Colorado Municipal Building
Corporation (the "Corporation "), do hereby waive notice of a
special meeting of the Board of Directors of the Corporation held
at 1:30 p.m. on Tuesday, May 7, 1991 at City Hall, Pueblo,
Colorado, for the purpose of acting upon a revised resolution
regarding the acquisition and financing of golf carts for the
City of Pueblo, Colorado and such other matters as may lawfully
come before the meeting.
Signed this 7th day of May, 1991.
ay Kastelic
%7 hn A. Califano
& - i A 6)iv4 �L
Billy G. JMartin
MINUTES OF ANNUAL MEETING
OF THE CITY OF PUEBLO, COLORADO
MUNICIPAL BUILDING CORPORATION
The annual meeting of the Board of Directors of the City of
Pueblo, Colorado Municipal Building Corporation was held at #1
City Hall Place, Pueblo, Colorado on the 16th day of April,
1991.
Directors Present:
Directors Absent:
Others Present:
Billy G. Martin
John A. Califano
Fay B. Kastelic
None
Lewis A. Quigley
Thomas E. Jagger
A motion was made by Fay B. Kastelic and seconded by John A.
Califano that the Minutes of the February 20, 1990 meeting be
approved. It was unanimously voted to approve the Minutes.
A motion was made by Fay B. Kastelic and seconded by John A.
Califano to reappoint Billy G. Martin to the Board of Directors
for another one year term to expire on the date of the next
annual meeting; all voted in favor.
A motion was made by Billy G. Martin and seconded by Fay B.
Kastelic to reappoint John A. Califano to the Board of Directors
for another one year term to expire on the date of the next
annual meeting; all voted in favor.
A motion was made by John A. Califano and seconded by Billy G.
Martin to reappoint Fay B. Kastelic to the Board of Directors
for another one year term to expire on the date of the next
annual meeting; all voted in favor.
A motion was made by Fay B. Kastelic that Lewis A. Quigley be
re- elected to another one year term as President; John A.
Califano seconded; and all voted in favor.
A motion was made by Fay B. Kastelic that John A. Califano be
re- elected to another one year term as Vice President; Billy G.
Martin seconded; and all voted in favor.
A motion was made by Billy G. Martin that Fay B. Kastelic be
re- elected to another one year term as Secretary and Treasurer;
John A. Califano seconded; and all voted in favor.
Thomas E. Jagger presented to the resolution attached hereto
regarding the acquisition and financing of certain equipment
golf carts) for the City of Pueblo, Colorado. After
iscussion, Billy G. Martin moved that the Resolution be
approved and adopted, Fay B. Kastelic seconded the motion, and
all voted in favor.
There being no further business to come before the meeting, upon
motion duly made, seconded and unanimously carried, the meeting
was adjourned.
DATED this 16th day of April, 1991.
Secretary
-2-