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R-41-03 Authorizing The Village Administrator To Enter Into A Lease And Option Agreement With Government Leasing CompanyRESOLUTIO RESOLUTION AUTHORIZING THE VILLAGE ADMINISTRATOR TO ENTER INTO A LEASE AND OPTION AGREEMENT WITH GOVERNMENT LEASING COMPANY WHEREAS, during the budget process it was determined that there were benefits to entering into a lease and option agreement for police vehicles; and WHEREAS, the Village has received a lease option agreement for four 2003 Dodge Inrepids and one 2003 Dodge 3500 Van. NOW, THEREFORE, BE IT RESOLVED by the CORPORATE AUTHORITIES, OF THE VILLAGE OF LEMONT, COOK COUNTY, ILLINOIS AS FOLLOWS: SECTION 1: AUTHORIZATION: The Village Administrator is hereby authorized and directed to execute an agreement with Government Leasing Company in the form attached hereto and incorporated herein as Exhibit A. SECTION 2: CONFLICTS: All prior Resolutions and Resolutions, or parts thereof in conflict or inconsistent with this Resolution are hereby expressly repealed only to the extent of such conflict or inconsistency. SECTION 3: REPEALER: All Resolutions or parts of Resolutions in conflict with any of the provisions of this Resolution shall be, and the same are hereby repealed. SECTION 4: This Resolution shall be in full force and effect from and after its passage, approval, and publication in pamphlet form, as provided by law. PASSED by the Board of Trustees of the Village of Lemont, Illinois this , 2003. AYES: NAYES: ABSENT: day of APPROVED by the President of the Village of Lemont, Illinois this day of 2003. Government May 21, 2003 Leasing Compa ny Village of Lemont Police Department 416 Main Street Lemont, IL 60439 Dear Mr. Hess: At the request of Steve Kizaric of Thomas Dodge of Orland Park, find enclosed the lease purchase documents for your acquisition of vehicles from them. If you have any questions regarding these documents, please feel free to contact me at 1- 800 - 822 -8070. In order to process this transaction as quickly as possible, please sign and return the lease documents along with the necessary additional documents we requested via Overnight Mail to: Government Leasing Company 830 Tenderfoot Hill Road, Suite 301 Colorado Springs, CO 80906 When you have received the equipment and are satisfied with its working condition, please sign the Acceptance Certificate and fax it to me at 1- 719 -576 -0370. Then, mail the original Acceptance Certificate and first payment (Invoice enclosed) to Government Leasing Company. I sincerely appreciate the opportunity to do business with you and thank you in advance for your expedient cooperation in this matter. Sincerely, Ed Anderson Account Executive www.gleasing.com Enclosures as Stated 830 Tenderfoot Hill Road #301 Telephone: 800 822 -8070 Colorado Springs • Telephone: 719 576 -8800 C o l o r a d o 8 0 9 0 6 Facsimile: 719 576 -0370 www.gleasing.com Lease No.: 8464 Lessee: Village of Lemont, IL LESSEE'S INSTRUCTIONS Required For Municipal Lease and Option Transactions In order to complete the lease transaction described above, the Lessee must complete, sign and return each of the documents identified (marked or highlighted) and must attach each of the documents identified as documents to be provided by Lessee. Lessee must INITIAL ANY CHANGE ADDITION OR DELETION in any of the documents. Documents not marked are not required for this transaction. DOCUMENTS PROVIDED BY LESSOR (MARKED WITH A RED X OR THAT HAVE BEEN HIGHLIGHTED) THAT MUST BE COMPLETED, SIGNED AND RETURNED BY LESSEE: NXI MUNICIPAL LEASE AND OPTION AGREEMENT: Needs to be signed by duly authorized employee of Lessee and MUST be attested to by Lessee's Clerk, Board Secretary or similar function with appropriate seal applied, or may be notarized. X] PAYMENT SCHEDULE: This is a schedule of payment due dates and amounts. PLEASE SIGN. '5( AMENDMENTS /ADDENDA: Modifications to the Municipal Lease and Option Agreement as a result of statutes /regulations governing Lessee for transactions of this type, or otherwise required by the proposed transaction. ACCEPTANCE CERTIFICATE: To be signed by highest ranking official at Equipment location and attested to by the person signing the Agreement for Lessee (TWO SIGNATURES ARE REQUIRED). Date when Equipment is accepted must be inserted by Lessee. DEPARTMENT OF THE TREASURY: IRS Form 8038 -GC is required to qualify this Agreement as a tax - exempt transaction. Requires Federal ID (nine -digit number with NO LETTERS). This is not a sales tax exemption number and is only required on transactions involving interest that qualifies as income tax exempt. DOCUMENTS THAT MUST BE PROVIDED BY LESSEE (MARKED WITH A RED X OR THAT HAVE BEEN HIGHLIGHTED): MINUTES: Shows the necessary approval from (city, state, county, etc.) of the transaction and to encumber funds. XPURCHASE ORDER: Issued to Vendor. (Sample Purchase Order enclosed) MUST be written by Lessee, specifying total term of the Agreement (e.g., such as 36 months at $126.00). ADVANCE PAYMENT: Invoice enclosed. Please forward, please make payable to Lessor. BID /BID RESPONSE /AWARD(S): Documents upon which this quote and documentation has been generated. (if applicable) f i ` MUNICIPAL CERTIFICATE: Verifies the decision and authority to enter into this Agreement. Please be sure that the person signing the Municipal Lease and Option Agreement also signs ONLY in section 1 of the Certificate and NOT at the bottom. (PLEASE ENCLOSE A COPY OF MINUTES APPROVING AGREEMENT.) LEGAL OPINION: Simplified opinion of counsel. Retype onto the letterhead stationery of the Lessee's attorney. Have the attorney sign and date. INSURANCE CERTIFICATE: As required by the Municipal Lease and Option Agreement, please provide a Certificate of Insurance (Acord Form 27 or equivalent), naming Lessor as ADDITIONAL INSURED AND LOSS PAYEE, or letter evidencing self- insurance (if approved by Lessor). FINANCIAL STATEMENTS: As required by the Municipal Lease and Option Agreement, please provide: Interim Financials from April 2002 to April 2003. TITLES: Upon registering & licensing of vehicle (s), forward the original titles to Government Leasing Company. CERTIFICATES OF ORIGIN: Upon receipt of the Certificates of Origin, please make copies and forward to Government Leasing Company. ,X/ WARRANTY INFORMATION: Documentation showing the period of warranty. Upon execution of these documents, please make copies for your records and forward all of the ORIGINAL documents to Government Leasing Company at: Via US Mail: P.O. Box 60519 , Colorado Springs CO 80960 -0519 Via express courier: 830 Tenderfoot Hill Road Suite 301, Colorado Springs, CO 80906 (45404.doc— 5/21/03 - 8464) Page 1 of 1 Lease No.: 8464 MUNICIPAL LEASE AND OPTION AGREEMENT LESSOR: Government Leasing Company 830 Tenderfoot Hill Road Suite 301 Colorado Springs, CO 80906 (800) 822-8070 (719) 576-8800 LESSEE: Village of Lemont Agreement No.: 8464 Police Department VENDOR: Thomas Dodge of Orland Park 416 Main Street 15941 South 94th Ave. Lemont, IL 60439 Orland Park, IL 60462 Attention: Assist Chief Thomas Hess Attention: Mr. Pete DeMeis (630) 257-5957 Fax: (630) 257.5087 (708) 403-8801 Fax: (708) 403.8974 NOTE: This is an interest income tax - exempt transaction. No TIN /SSN must be provided because none of the payments are I.R.S reportable (such as Form 1099) (See Sections 103, 149, and 6041 of the Internal Revenue Code of 1986, as amended, and the Instructions for Forms 1099, 8038 -G and 8038 -GC.) EQUIPMENT DESCRIPTION (make, model, serial no. and attachments — Equipment is new unless noted) Four (4) New 2003 Dodge Police Car w /ot Equipment 8 One (1) New 2003 Dodge 3500 Cargo Van Any additional equipment will be described in any Detailed Equipment Description Amendment that is executed and which refers to this Agreement. Lessor assumes and shall have no no representative of Vendor is authorized the Equipment Description. Lessor or Lessor or assignee. responsibility for performance or maintenance of Equipment. Equipment is to be insured by Lessee. VENDOR IS NOT AN AGENT OF LESSOR and to waive, supplement or otherwise alter any provision hereof. Maintenance and/or supplies ARE NOT included in this Agreement unless specified in assignee has a security interest in Equipment and must be notified in writing of any removal or trade -in of Equipment before full payment is made to EQUIPMENT COST — TERM — PAYMENTS LEASE TERM 3 Annual payments (includes interest, see Section 5.02). PAYMENTS $31,051.00 upon acceptance and $31,051.00 Annual payments as provided in the Payment Schedule. TOTAL AMOUNT FINANCED $82,933.00 — Does not include sales tax, any sales tax due and all additional taxes will be the sole responsibility of Lessee. PURCHASE OPTION AMOUNT Purchase Option is $1.00 after timely making all payments. THIS AGREEMENT IS SUBJECT TO THE TERMS AND CONDITIONS PRINTED ON THE FOLLOWING PAGE, WHICH TERMS ARE MADE A PART HEREOF. TERMS AND CONDITIONS Lessor hereby leases the Equipment to Lessee for the following purposes and upon the following terms and conditions: ARTICLE I: COVENANTS OF LESSEE. Lessee represents, covenants and warrants, for the benefit of Lessor and its assignee(s), as follows: A. Lessee is a public body, corporate and politic, duly organized and existing under the Constitution and laws of the State as set forth above ("State ") and will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a body corporate and politic. B. Lessee has been duly authorized to execute, deliver and perform this Agreement under the Constitution and laws of the State and under the terms and provisions of the resolution of its goveming body, or by other appropriate official approval. Lessee further represents. covenants and warrants that 55 requirements have been met, and procedures have occurred in order to ensure the enforceability of this Agreement, and Lessee has complied with such public bidding requirements as may be applicable to this Agreement and the acquisition by Lessee of the Equipment hereunder. If requested, Lessee shall deliver to Lessor an opinion of Lessee's counsel in form acceptable to Lessor. C. During the term of this Agreement, the Equipment will be used by Lessee only for the purpose of performing one or more governmental or proprietary functions of Lessee consistent with the permissible scope of Lessee's authority and will not be used in a trade or business of any person or entity other than the Lessee. D. During the period this Agreement is in force, Lessee will annually provide Lessor or its assignee(s) with current financial statements, budgets. proof of appropriation for the ensuing fiscal year and such other financial information relating to the ability of Lessee to continue performing its obligations under this Agreement as may be reasonably requested by Lessor or its assignee(s). Lessee further agrees to make its best effort to budget for and have appropriated for each budget and /or appropriation cycle, sufficient funds to make the Lease Purchase Payments throughout the entire Lease Term. E. The Equipment will have a useful life in the hands of the Lessee that is substantially in excess of the Original Term plus any Renewal Terms. F. The Equipment is, and shall remain during the period this Agreement is in force, personal property and when subject to use by Lessee under this Agreement, will not be or become a fixture under applicable law. G. This Agreement, as written. including all of its Amendments and Addendums, supercedes and replaces any and all representations made by Vendor. H. The Equipment described above is NOT BEING LEASED ON ANY TYPE OR FORM OF A TRIAL OR RENTAL BASIS. I. Lessee will comply with all applicable provisions of the Internal Revenue Code of (986 (the "Code "), including without limitation Sections 103 and 148 thereof, and the applicable regulations of the U.S. Treasury Department in order to maintain the exclusion of the interest components of Lease Purchase Payments from gross income for the purposes of U.S. federal income taxation. J. Lessee will use the proceeds of this Agreement as soon as practicable, and with all reasonable dispatch, for the purpose for which this Agreement has been entered into. No part of the proceeds of this Agreement shall be invested in any securities, obligations or other investments or used, at any time, directly or indirectly, in a manner which, 4 such use had been reasonably anticipated on the dale of issuance of this Agreement, would have caused any portion of the Agreement to be or become "arbitrage bonds" within the meaning of Section 103(b)(2) or Section 148 of the Code, as amended, and the applicable regulations of the U.S Treasury Department. K. Lessee hereby designates the Agreement as a "qualified tax - exempt obligation" as defined in Section 265(b)(3) (B) of the Code. The aggregate face amount of all tax- exempt obligations (excluding private activity bonds other than qualified 501(C)(3) bonds) issued, or to be issued, by Lessee and all subordinate entities thereof during the calendar year of commencement of this Agreement (the "Issuance Year") is not reasonably expected to exceed 510.000,000.00 Lessee and all subordinate entities thereof will not issue in excess of $10,000,000.00 of qualified tax - exempt obligations (including this Agreement, but excluding private activity bonds other than qualified 501(c)(3) during the Issuance Year without first obtaining an opinion of nationally recognized counsel in the area of tax- exempt obligations acceptable to Lessor that the designation of this Agreement as a "qualified lax - exempt obligation" will not be adversely affected. [Omit and initial this paragraph if it is not applicable.] L. Lessee represents and warrants that it is a govemmental unit. under the laws of the Stale with general taxing powers. this Agreement is not a private activity bond as defined in Section 141 of the Code. as amended. 95% or more of the net proceeds of this Agreement will be used for local governmental activities of Lessee and the aggregate face amount of all tax - exempt obligations (other than private activity bonds) issued, or to be issued. by the Lessee and all subordinate entities thereof during the Issuance Year is not reasonably expected to exceed $5,000,000.00 Lessee and at subordinate entities thereof will not issue in excess of $5,000,000.00 of tax - exempt bonds (including this Agreement, but excluding private activity bonds) during the Issuance Year without first obtaining an opinion of nationally recognized counsel in the area of tax - exempt municipal obligations acceptable to Lessor that the excludability of the interest on the Agreement from gross income for federal tax purposed will not be adversely affected. [Omit and initial this paragraph if 4 is not applicable.] ARTICLE II: DEFINITIONS. The following terms will have the meanings indicated below unless the context clearly requires otherwise: "Agreement" means this Municipal Lease and Option Agreement. "Lease Term" means the Original Term defined in Article 10 hereof and a sufficient number of automatic renewal Terms as will equal the Lease Term set forth on the face of this Agreement. "Lessor" means (i) the entity designated on the face of this Agreement as Lessor hereunder, (t) any surviving, resulting or transferee corporation, and (iii) except where the context requires otherwise, any assignee(s) of Lessor. "Buy -out After Payment Amount" means the amount of the payments for the balance of the entire Lease Term (assuming no early termination) plus the Purchase Option Amount shown above. it any, discounted to the date of payment at five percent (5 %) per annum, plus payment of any amounts due hereunder but not yet paid, together with interest on such overdue amounts at ten percent (10 %) per annum through the date of payment. "Renewal Term(s)" means the automatic renewal periods of this Agreement, each having a duration of one (1) year co-terminus with Lessee's fiscal year except the last of such periods which shall end on the anniversary of the Commencement Date. The terns and conditions during any Renewal Term shall be the same as the terms and conditions during the Original Term, except that the Lease Purchase Payments shall be as provided in the attached Payment Schedule. "Vendor' means the manufacturer of the Equipment as well as the agents or dealers of the manufacturer from whom Lessor purchased or is purchasing the Equipment. ARTICLE III: COMMENCEMENT OF LEASE TERM. The Original Term of this Agreement shall commence on the date the Equipment is accepted by Lessee as indicated on the Certificate of Acceptance ( "Commencement Date') an. shall terminate the last day of Lessee's current fiscal year. For the duration of the Lease Term, this Agreement will be automatically renewed at the end of the Original Term and any Renewal Term unless the Lessee gives written notice to Lessor not less than thirty (30) days prior to the end of the Original Term or Renewal Term then in effect of Lessee's intention to terminate this Agreement pursuant to Section 5.05 as the case may be. If Lessee fails to accept the Equipment within a reasonable time after its delivery (not to exceed ten (10) days), then at the option of Lessor, the obligations of Lessor to provide the Equipment to Lessee hereunder may be cancelled and in such event Lessee shall assume all of Lessor's obligations under any purchase order or purchase agreement with the Vendor related to the Equipment in lieu of its obligation to make Lease Purchase Payments. Further, in such case, Lessee agrees to indemnify and hold Lessor harmless from any claims, including demand for payment of the purchase price of the Equipment. ARTICLE N: INSPECTION. Lessor and any assignee of Lessor's right under this Agreement shall have the right at all reasonable times during business hours to enter into and upon the property of Lessee for the purpose of inspecting the Equipment. ARTICLE V: LEASE PURCHASE PAYMENTS. Section 5.01. Lease Purchase Payments to Constitute a Current Expense of Lessee. Lessor and Lessee understand and intend that the obligation of Lessee to pay Lease Purchase Payments hereunder shall constitute a current expense of Lessee and shall not in any way be construed to be a debt of Lessee in contravention of any applicable constitutional or statutory limitations or requirements concerning the creation of indebtedness by Lessee, nor shall anything contained herein constitute a pledge of the general tax revenues, funds or monies of Lessee. Section 5.02 Payment of Lease Purchase Payments. Lessee shall pay Lease Purchase Payments, exclusively from legally available funds, in lawful money of the United States of America to Lessor or, in the event of assignment by Lessor, to its assignee, in the amounts and on the dates se( forth in the Payment Schedule attached to this Agreement. A portion of each Lease Purchase Payment is paid as, and represents payment of, interest and principal. respectively. The Payment Schedule sets forth the interest component and principal component of each Payment during the Lease Term. Section 5.03 Lease Purchase Payments to be Unconditional. Subject to Section 5.05, the obligation of Lessee to make payment of Lease Purchase Payments and other payments required under this Agreement shall be absolute and unconditional in all events and are intended by the parties to be "net" of taxes and insurance Lessee shall make all such payments when due and shall not withhold any such payments as a result of any disputes arising between or among Lessee and Lessor, any Vendor or any other person, nor shall Lessee have the right to assert any set -off, reduction or deduction, defense. or counterclaim against its obligation to make such payments or be entitled to any abatement of such payments as a result of accident or unforeseen circumstances or any other reason. Section 5.04 Continuation of Lease Term by Lessee. Lessee intends to renew this Agreement through all of the Renewal Terms and to pay all the Lease Purchase Payments hereunder. Lessee reasonably believes that legally available funds of an amount sufficient to make all Lease Purchase Payments during the Original Term and each Renewal Term can be obtained. Lessee further intends to do all things (45405. don — 4/1/03 - B464) Page 1 of 3 IawfNly within its power to obtain and maintain funds from which Lease Purchase Payments may be made, including making provision for such payments to the extent necessary in each bi- annual, annual. or otherwise periodic budget submitted and adopted in accordance with applicable provisions of state and local law, to have such portion of the budget approved and to exhaust all available reviews and appeals in the event such portion of the budget is not approved. Section 5.05 Non - appropriation. In the event sufficient funds shall not be appropriated for the payment of the Lease Purchase Payments required to be paid in the next occurring Renewal Temn. then Lessee may terminate this Agreement at the end of the Original Term or then current Renewal Term, and Lessee shall not be obligated to make payment of the Lease Purchase Payments provided for in this Agreement beyond the Original Term or the then current Renewal Term. Lessee agrees to deliver proof of non - appropriation including rejection of reviews and appeals and notice to Lessor of such termination at least thirty (30) days prior to the end of the Original Term or the then current Renewal Term. However, failure to deliver such proof of non - appropriation and notice to Lessor shall not extend the term of this Agreement beyond the end of the Original Term or the then current Renewal Term. If this Agreement is terminated under this Section 5.05, Lessee agrees, at Lessee's cost and expense, to peaceably deliver the Equipment to Lessor at the location specified by Lessor that is a reasonable distance from the initial location of the leased Equipment. ARTICLE VI: TITLE TO EQUIPMENT; SECURITY INTEREST. Section 6.01 Title to the Equipment During the term of this Agreement. risk of loss and title to the Equipment and any and all additional, repairs, replacements or modifications shall vest in Lessee, subject to the rights of Lessor under this Agreement. In the event of default as set forth in Section 12.01 or non - appropriation as set forth in Section 5.05, title to the Equipment shall immediately vest in Lessor, and Lessee will, upon Lessor's request, surrender possession of the Equipment to Lessor. Lessee, irrevocably, hereby designates, makes, constitutes and appoints Lessor, its successors and assigns (and any designee) as Lessee's true and lawful attorney (and agent -in -fact) with power of substitution. at such time of default or non - appropriation or times thereafter as Lessor in its sole and absolute discretion may determine, in Lessee's name, to endorse the name of Lessee upon a Bill of Sale, document, instrument, invoice, freight bill, bill of lading or similar document relating to the Equipment to vest title in Lessor, its successors or assigns and transfer possession to Lessor. Section 6.02 Security Interest. To secure the payment of all Lessee's obligations under this Agreement, Lessee grants to Lessor a first priority purchase money security interest in the Equipment and on all additions, attachments, accessions and substitutions thereto, and on any proceeds therefrom. Lessee agrees to execute and authorizes Lessor to execute and file on Lessee's behalf, such additional documents, including a UCC -1 financing statement in the form required for filing, and such other financing statements, certificates of title, affidavits. notices and similar instruments, satisfactory to Lessor. which Lessor deems necessary or appropriate to establish and maintain its security interest, and upon assignment, the security interest of any assignee of Lessor, in the Equipment. ARTICLE VII: MAINTENANCE; MODIFICATION; TAXES; AND INSURANCE. Section 7.01 Maintenance of Equipment by Lessee. Lessee agrees that at all times during the Lease Term, Lessee will, at Lessee's own cost and expense, maintain, preserve and keep the Equipment in good repair, working order and condition, and will from time to time make or cause to be made all necessary and proper repairs, replacements and modifications. If appropriate, Lessee will enter into a maintenance contract for the Equipment with Vendor or such other firm as Lessee may choose subject to the express written approval of Lessor, which approval shall not be unreasonably withheld. Section 7,02 Taxes, Other Governmental Charges and Utility Charges. The parties to this Agreement contemplate that the Equipment will be used for govemmental or proprietary purpose of Lessee and, therefore, the Equipment will be exempt from all taxes presently assessed and levied with respect to personal property. In the event the ownership, use, possession or acquisition of the Equipment is found to be subject to taxation in any form (except for income taxes payable by Lessor) Lessee will pay, as the same respectively come due, all taxes and govemmental charges of any kind whatsoever that may at any time be lawfully assessed or levied against or with respect to the Equipment. If such tax is imposed directly on Lessor or its assigns. Lessee shall reimburse the person paying such tax on demand. If Lessee causes or allows events to happen that changes the interest income tax-exempt status of this Agreement, as outlined in Sections 103, 149, and 6041 of the Internal Revenue Code of 1986, as amended, or, assuming the Lessee has designated this Agreement as a "qualified tax - exempt obligation ", if the Lessee exceeds ten million dollars (510,000,000.00) in "qualified tax - exempt obligations", as specified in Section 265 (b) (3) (B) of the Internal Revenue Code of 1986, as amended, during the calendar year of commencement of this Agreement so that Lessee does not qualify as a "qualified small issuer" thereunder it will pay the "taxable interest rate" on this Agreement retroactive to its Commencement Date. The "taxable interest rate is hereby defined as that rate that results in the same after fax yield to the Lessor or to its Assigns. as the tax- exempt rate on this Agreement or the highest rate permitted by law, whichever is less. In all events, Lessee shall pay all gas, water, steam, electricity, heal, power, telephone, utility and other charges incurred in the operation, maintenance, use, occupancy and upkeep of the Equipment. Section 7.03 Insurance. At its own expense Lessee shall cause casualty, PUBLIC LIABILITY AND PROPERTY DAMAGE insurance to be carried and maintained, or shall demonstrate to Lessor's satisfaction that adequate self- insurance is provided with respect to the Equipment, sufficient to protect the full replacement value (new) of the Equipment or the then applicable Buy -Out After Payment Amount, whichever is greater), and to protect Lessor from any liability related to the Equipment in all events. All insurance proceeds from casualty losses shall be payable as provided in Article VIII hereof. Lessee shall pay all deductibles and shall fumish to Lessor, or to its Assigns, Certificates evidencing such coverage throughout the Lease Tenn. Alternatively, Lessee may insure the Equipment under a blanket insurance policy or policies, which cover not only the Equipment but also other properties. If Lessee shall insure similar properties by self-insurance, Lessee will insure the Equipment by means of an adequate insurance fund. All insurance shall name Lessee and Lessor as insureds and loss payees as their respective interests may appear and shall provide for at least ten (10) days prior written notice by the underwriter or insurance company to the Lessor and its assigns in the event of cancellation or expiration. ARTICLE VIII: DAMAGE; DESTRUCTION AND CONDEMNATION; PROCEEDS. Section 8.01 Damage, Destruction and Condemnation. Lessee is responsible for any theft or destruction of, or damage to, the Equipment, whether insured or not ("Loss"). Lessee shall continue to satisfy all its obligations hereunder (including, but not limited to the payment of Lease Purchase Payments), even if there has been a Loss. If prior to the termination of the Lease Term (a) the Equipment or any portion thereof is destroyed (in whole or in part) or is damaged by fire or other casualty or (b) title to, or the temporary use of, the Equipment or any part thereof or the estate of Lessee or Lessor in the Equipment or any part thereof shall be taken under the exercise of the power of eminent domain by any govemmental body or by any person, firm or corporation acting under govemmental authority, Lessee and Lessor will cause the proceeds of any insurance claim or condemnation award, after deducting all expenses (including attomey's fees) incurred in the collection of such claim or award ("Net Proceeds "), to be applied to Lessee's obligations pursuant to Section 8.02 hereof. Section 8.02 Application of Net Proceeds. Provided the Equipment is not deemed to be a total loss, Lessee shall, if Lessee is not in default hereunder, cause the repair, replacement or restoration of the Equipment and pay the cost thereof, and, if Lessee is in default hereunder, cause the net proceeds to be applied as if total destruction or damage had occurred. In the event of total destruction or damage to the Equipment, whether or not Lessee is in default, at Lessor's option, Lessee shall pay to Lessor on the Lease Purchase Payment due dale next succeeding the date of such loss the amount of the Buy -Out after Payment Amount applicable to such date, plus the Lease Purchase Payment due on such date, plus any other amounts payable by Lessee hereunder, and, upon payment in full of such amounts, the Lease Tenn shall terminate and Lessor's security interest in the Equipment shall terminate. Lessee shall retain Net Proceeds in excess of the then applicable Buy -Out after Payment Amount, if any. Lessee agrees that if the Net Proceeds are insufficient to pay in full Lessee's obligabons hereunder, Lessee shall make such payments to the extent of any deficiency. ARTICLE IX: DISCLAIMER OF WARRANTIES; VENDOR'S WARRANTIES; USE. Section 9.01 Disclaimer of Warranties. LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE OR FITNESS FOR USE OF THE EQUIPMENT, OR ANY OTHER WARRANTY WITH RESPECT THERETO. IN NO EVENT SHALL LESSOR BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR THE EXISTENCE, FURNISHING, FUNCTIONING OR LESSEE'S USE OF THE EQUIPMENT OR ANY ITEM THEREOF OR SERVICES PROVIDED FOR IN THIS AGREEMENT, OR ANY SERVICES PROVIDED BY VENDOR. Any transfer of the Equipment to the Lessee shall be made disclaiming all express and implied warranties from Lessor and its assigns. Section 9.02 Vendors Warranties. Lessor hereby irrevocably appoints Lessee its agent and attorney -in -fact during the Lease Term, so long as Lessee shall not be in default hereunder, to assert from time to time whatever claims and rights, including warranties of the Equipment, which Lessor may have against the Vendor of the Equipment. Lessee's sole remedy for the breach of any such warranty, indemnification or representation shall be against the Vendor and/or manufacturer of the Equipment. Lessee expressly acknowledges that Lessor makes, and has made, no representation or warranties whatsoever as to the existence or availability or enforceability of such warranties of the Vendor or manufacturer. Section 903 Use of the Equipment. Lessee will not install, use, operate or maintain the Equipment improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by this Agreement. Lessee shall provide all permits and licenses, if any, necessary for the installation and operation of the Equipment. In addition, Lessee agrees to comply in all respects (including, without limitation, with respect to the use, maintenance and operation of each item of the Equipment) with all laws of the jurisdictions in which its operations involving any item of Equipment may extend and any legislative, executive, administrative or judicial body exercising any power or jurisdiction over the items of the Equipment provided, however, that Lessee may contest in good faith the validity or application of any such law or rule in any reasonable manner which does not, in the opinion of Lessor, adversely affect the estate of Lessor in and to any of the items of the Equipment or its interest or rights under this Agreement. Lessee agrees that no more than 10% of the use of the Equipment in any month will be by persons or entities other than the Lessee or its employees on matters relating to such employment, and no more than 5% of the use of the Equipment in any month will be unrelated to use by or for the Lessee. Lessee further agrees that no management contracts will be entered into with respect to the use of the Equipment unless: (a) at least half of the compensation is on a periodic, fixed fee basis; (b) no compensation is based on a share of net profits; (c) the Lessee is able to terminate the contract without penalties at the end of any three years; and (d) the total term of such contract, including any renewals does not exceed five years. ARTICLE X: EARLY OPTION TO PURCHASE. Provided Lessee is not in default hereunder, Lessee may, upon giving Lessor not less than thirty (30) days prior written notice, elect to purchase all, but not less than all, of the Equipment at the end of each month, or Payment due date as established by the Commencement Date, for the Buy -Out After Payment Amount. Upon exercise of this early option to purchase, Lessee shall pay these amounts to Lessor or its assigns, on demand. As a condition precedent to exercising this early option to purchase, Lessee shall deliver to Lessor and its assigns a termination of any maintenance funding or disbursing oblgabons related to this Agreement. ARTICLE XI: ASSIGNMENT; SUBLEASING; AND ADDITIONAL COVENANTS. Section 11.01 Assignment by Lessor. This Agreement, and the right to receive the payments to be made hereunder, may be assigned by Lessor and reassigned in whole or in part to one or more assignees at any time subsequent to the execution of this Agreement, without obtaining the consent of Lessee. Lessor agrees to give notice of assignment and upon receipt of such notice Lessee agrees to make all payments to the assignee designated in the notice of assignment, notwithstanding any claim, defense, set -off or counterclaim whatsoever (whether arising from a breach of this Agreement or otherwise) that Lessee may from time to time have against Lessor, or the assignee. Lessee agrees to execute all documents, including notices of assignment and chattel mortgages or financing statements that may be reasonably requested and provided by Lessor or its assignee in order to protect their interests in the Equipment and in this Agreement. The Lessor's interest in this Agreement may not be assigned or reassigned in whole or in part unless (i) the document by which such assignment or reassignment is made discloses the name and address of the assignee and (ii) the Lessee receives written notification of the name and address of the assignee. The Lessee covenants and agrees with the Lessor and each subsequent assignee of Lessor to maintain for the full term of this Agreement a complete and accurate written record of each such assignment and reassignment in form necessary to comply with Section 149(e) of the Internal Revenue Code of 1986, as amended, and the regulations proposed or existing from time to time promulgated hereunder. Anything in the foregoing apparently to the contrary notwithstanding, the Lessors interest in this Agreement may be assigned in whole or in part upon terms which provide in elect that the assignor or assignee will act as a collection and paying agent for holders of certificates of participation in this Agreement, provided the Lessee receives written notification of the name and address of such collection and paying agent, and such collection and paying agent covenants and agrees to maintain for the full remaining term of this Agreement a written record of each assignment and reassignment of such certificates of participation. Section 11.02 No Sale, Assignment or Subleasing by Lessee. This Agreement and the interest of Lessee in the Equipment may not be sold, assigned or encumbered by Lessee without the prior written consent of Lessor. Section 11.03 Additional Covenants. To the extent permitted by the laws and Constitution of the Stale, Lessee shall protect and hold harmless Lessor from and against any and all liability. obligations, losses, claims and damages whatsoever, regardless of cause thereof (except for such liability, obligation, loss, claim or damage caused by Lessor or its Assigns), and expenses in connection therewith, including, without limitation, counsel fees and expenses, penalties and interest arising out of or as the result of the entering into of this Agreement, the ownership of any item of the Equipment, the ordering, acquisition, use, operation, condition, purchase, delivery, rejection, storage or return of any item of the Equipment or any accident in connection with the operation, use, condition, possession, storage or return of any item of the Equipment resulting in damage to property or injury to or death to any person. The indemnification arising under this paragraph shall continue in full force and effect notwithstanding the full payment of all obligations under this Agreement or the termination of the Lease Term for any reason. ARTICLE XII: EVENTS OF DEFAULT AND REMEDIES. Section 12.01 Events of Default Defined, The following shall constitute an "event of default" hereunder: A. Failure by Lessee to pay any Lease Purchase Payment or other payment required to be paid hereunder at the time specified herein; or B. Failure by Lessee to observe and perform any other covenant, condition or agreement on its part to be observed or performed, other than for a period of thirty (30) days after written notice to Lessee, specifying such failure and requesting that it be remedied unless Lessor shall agree in writing to an extension of such time prior to its expiration provided, however, if the failure stated in the notice cannot be corrected within the applicable period. Lessor will not unreasonably withhold its consent to an extension of such time if corrective action is instituted by Lessee within the applicable period and dilgently pursued until the default is corrected; or C. Breach of any material representation or warranty by Lessee under this Agreement; or D. Commencement by Lessee of a case or proceeding under the Federal bankruptcy laws or filing by Lessee of any petition or answer seeking reorganization, arrangement, composition, readjustment, liquidation or similar relief under any existing or future bankruptcy, insolvency or other similar law or an answer admitting or not contesting the material allegations of a petition filed against Lessee in any such proceeding: or (45405 doc - 4/1/03 - 8064( Page 2 of 3 E. A; etition against Lessee in a proceeding under any existing or future bankruptcy, insolvency or other similar law shall be filed and not withdrawn or dismissed within thirty (30) days thereafter. Section 12.02 Remedies on Default. Upon the occurrence of an event of default, Lessor shall have the right, at its sole option without any further demand or notice, to exercise any one or more of the following remedies: A. By written notice to lessee, Lessor may declare all payments and other amounts payable by Lessee hereunder to the end of the then current Original Term or Renewal Term to be due; B. With or without terminating this Agreement, retake possession of the Equipment and sell, lease or sublease the Equipment with the net proceeds thereof to be applied as provided herein; C. Require Lessee at Lessee's risk and expense to promptly return the Equipment in the manner and in the condition set forth in Section 13.10 hereof: D. If Lessee refuses to return the Equipment for any reason, the Equipment shall be deemed a total loss and Lessee shall pay to Lessor the Buy -Out after Payment Amount, E. Take whatever other action at law or in equity that may appear necessary or desirable to enforce its rights as the owner of the Equipment; and, F. The proceeds of such sale, lease or sublease of the Equipment pursuant to Section 12.02 6 shall be applied in the following order: 1) to all expenses of Lessor in exercising its remedies under this Agreement, including without limitation at expenses of taking possession, storing, reconditions and selling, leasing or subleasing of the Equipment and all brokerage, auctioneers' and attorneys' fees 2) the applicable Buy -out After Payment Amount 3) all unpaid Lease Purchase Payments and other amounts payable by Lessee hereunder to the end of the then current Original Term or Renewal Term and 4) the balance to the Lessee unless Lessee shall so waive such payment. I1 the proceeds of such sale, lease or sublease shall be insufficient to pay all of items 1), 2), and 3), Lessee shall remain liable for any deficiency as to item 3), but will not remain liable for any deficiency as to items 1) and 2) in this section F. Section 12,03 No Remedy Exclusive. No remedy herein conferred upon or reserved to Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. ARTICLE XIII: MISCELLANEOUS. Section 13.01 Notices. All notices, certificates or other communications hereunder shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, to the parties at their respective addresses. Section 13.02 Binding Effect. Subject to the limitations on assignment, this Agreement shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. Section 13.03 Severability. In the event any court of competent jurisdiction shall hold any provision of this Agreement invalid or unenforceable, such holding shall not invalidate or render unenforceable any other provision hereof. Section 13.04 Advances. In the event Lessee fails to pay any amounts due hereunder or to perform any of its obligations under this Agreement, Lessor may at its option pay such amounts or perform such obligation, and Lessee shall reimburse Lessor the amount of such payment or cost of performance upon demand, together with interest at the rate of eighteen percent (18 %) per annum or the highest rate permitted by law, whichever is less. Section 13.05 Execution in Counterparts. This Agreement may be executed in multiple counterparts. all of which shall constitute one and the same instrument. The counterpart bearing Lessor's signature shall constitute the sole chattel paper original of this Agreement. Section 13.06 Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of the Lessor. Section 13.07 Captions. The captions or headings in this Agreement are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement. Section 13.08 Entire Agreement. This Agreement constitutes the entire agreement between Lessor and Lessee and may not be amended, altered or modified except by written instrument signed by Lessor and Lessee. The execution of such writing by Lessor's assignee shall be sufficient for such purposes if Lessor has assigned this Agreement. There are no understandings. agreements, representations or warranties, express or implied, not specified herein regarding this Agreement or the Equipment leased hereunder. Any terms and conditions of any purchase order or other document (with the exception of Supplements) submitted by Lessee in connection with this Agreement which are in addition to or inconsistent with the terms and conditions of this Agreement will not be binding on Lessor and will not apply. Section 13.09 Finance Lease. The parties intend that the Lessor shall have all benefits of a lessor under a finance lease under the uniform commercial code. Lessor did not select, manufacture, or supply the leased property and only acquired it (or the right to use such leased property) in connection with this Agreement. Further, Lessee acknowledges: (a) Lessee received a copy of the contract by which Lessor acquired the leased property before signing this Agreement, (b) Lessee approved said contract as a condition of the effectiveness of this Agreement, (c) prior to signing this Agreement, Lessee received a statement designating the vendor promises, warranties and limitations or modifications of remedies, or (d) prior to signing this Agreement, Lessee was told that the uniform commercial code - leases. govems this transaction and that Lessee may communicate directly with the vendor conceming the matters described in subsection (c) of this sentence. Section 13.10. Return of Equipment. Upon termination of the Agreement for any reason (except purchase by the Lessee), at the option of Lessor, (i) at its sole cost and expense, Lessee will immediately return the Equipment to Lessor in accordance with the provisions of this section, or (ii) Lessor shall transfer ownership of the Equipment to Lessee If shipped, the Equipment shall be packed in accordance with the Vendor's specifications and returned to Lessor at the location specified by Lessor in the Continental United States reasonably close to where it was originally delivered, in the same condition as when accepted, ordinary wear and tear excepted. Such shipment shall be f.o.b. destination. Lessee shall bear all costs associated with such packing and shipping and the risk of loss shall not pass to Lessor until the Equipment has been received by it INSURANCE COVERAGE REQUIREMENTS In accordance with Section 7.03 of this Agreement eithe 1. We have instructed the following insurance a (insert name, address and telephone number) to issue to you. a. All Risk Physical Damage Insurance on the leased Equipment evidenced by a Certificale of Insurance and Long Form Loss Payable Clause (Acord Form 27 or its equivalent) naming Lessor designated above andlor its Assigns as an additional insured, and b. Public Liability Insurance evidenced by a Certificate of Insurance (Acord Form 27 or its equivalent) naming Lessor andlor its assigns as an additional insured, or 2. We are self- insured for all risk, physical damage. and public liability and will provide proof of such sell- insurance in letter form together with a copy of the statute authorizing this form of insurance. Proof of insurance coverage will be provided to you prior 10 the time that the Equipment is delivered to us. Village of Lemont Dale' it By (Authorized Official) ESSENTIAL USEISOURCE OF FUNDS LETTER Ladies/Gentlemen: This confirms and affirms that the Equipment described in this Agreement is essential to the function of the undersigned or to the service we provide to our citizens. Further, we have an immediate need for, and expect to make immediate use of. substantially all such Equipment which need is not temporary or expected to diminish in the foreseeable future. Such Equipment will be used b1 us only for the purpose of performing one or more of our governmental or proprietary functions consistent with the permissible scope of our authority. Specifically, such Equipment was selected by us to be used as follows: X The estimated useful life of such Equipment based upon manufacturer's representations and our projected needs is. for at least four (4) years. Our source of funds for payments of the rent due under the Agreement for the current fiscal year is: CurrenUproposed budget. We expect and anticipate adequate funds to be available tor all future Lease Purchase Payments due after the current fiscal year for the following reasons:/,, Date: l\ Village of Lemont By" (Authorized Official) ACCEPTED BY: LESSOR: Government Leasing Company By: Name: Thomas Wittwer Title: President (45405.doc - 4/1103 - 64642 Page 3 of 3 Lessee acknowledges reading and receiving a copy of this Agreement. The undersigned affirms that she/he has been duly authorized to execute this Agreement on behalf of the above -named Lessee. Depending on the jurisdiction, this may be the highest elected official. LESSEE: Village of Lemont By: Name: Title: )( Attested By: Title of Attestee: X GOVERNMENT LEASING COMPANY 1- 800 - 822 -8070 Municipal Lease Program Number: 8464 Lessee: Village of Lemont Vendor: Thomas Dodge of Orland Park Equipment: Four (4) New 2003 Dodge Police Car w /ot Equipment & One (1) New 2003 Dodge 3500 Cargo Van * If an early buy -out is desired, please contact Government Leasing Company at 1- 800 - 822 -8070. Accepted by: Printed Name: Title: Date Accepted: Compound Period: Yearly Equipment Cost: +Sales Tax Amt: -Down Pmt to Vendor: - Trade -In Allowance: =Net Equipment Cost: +Down Pmt to GLC: +Oth Lease Buy -Out: +Financed Maint Amt: =Lease Amount: $82,933.00 $0.00 $0.00 $0.00 $82,933.00 $0.00 $0.00 $0.00 $82,933.00 Payment Schedule Buy -out* Payment # Date Loan Payment Interest Principal After Payment 6- Jun -03 82,933.00 N/A 1 6- Jun -03 31,051.00 - 31,051.00 N/A 2 6- Jun -04 31,051.00 6,678.71 24,372.29 29,432.22 3 6- Jun -05 31,051.00 3,541.29 27,509.71 0.00 DETAILED EQUIPMENT DESCRIPTION AMENDMENT MUNICIPAL LEASE AND OPTION AGREEMENT NO. 8464 GOVERNMENT LEASING COMPANY ( "LESSOR ") VILLAGE OF LEMONT ( "LESSEE ") DATED: The parties to the Agreement identified above have agreed to the following additions, deletions and /or modifications. To the extent that the provisions of this Amendment conflict with, modify, or supplement the terms of the Agreement, the provisions contained in this Amendment shall prevail and control. The other terms and provisions of the Agreement shall continue to be effective. This Amendment shall be a part of the Agreement and is hereby incorporated therein. The description of the Equipment in the Agreement is amended and restated to include the following specifically described equipment: Item No. Quantity Make Model Year Serial No.NIN Location General Description 1 1 Dodge Intrepid 2003 416 Main St. Vinyl Floor (no carpet), Traction Control, 8 Way Power Driver Seat, open Wheel W /Chrome Hub Cap, Standard Cloth Front Buckets WNinyl Rear Bench 2 1 Dodge Intrepid 2003 416 Main St. Same as above 3 1 Dodge Intrepid 2003 416 Main St. Same as above 4 1 Dodge Intrepid 2003 416 Main St. Traction Control, 8 Way Power Driver Seat, Bodyside Molding, Delete Spotlight, 50/50 Front Bench W /Cloth Rear 5 1 Dodge 3500 Van 2003 416 Main St. 127" Wheelbase Cargo Van, 5.2L V -8 W /overdrive Automatic, Air Conditioning, Tilt wheel, Power Windows, Locks, Illuminated and keyless Entry, Cloth Seats LESSOR: Government Leasing Company By: Date: Thomas Wittwer, President LESSEE: Village of Lemont (for): Police Department By: A Printed Name: Authorized Signature (45438.doc — 5/21/03 - 8464) Date: X Title: /1 ACCEPTANCE CERTIFICATE Madam /Sir: In accordance with the terms of the Municipal Lease and Option Agreement No. 8464, dated ( "Agreement ") between Government Leasing Company ( "Lessor "), and the undersigned ( "Lessee "), Lessee hereby certifies and represents to, and agrees with, Lessor as follows: 1. The Equipment, as such term is defined in the Agreement, is new and has been delivered and installed at the Equipment Location specified in the Agreement and accepted on the date indicated below. 2. Lessee has conducted such inspection and /or testing of the Equipment as it deems necessary and appropriate and hereby acknowledges that it accepts the Equipment for all purposes. 3. No Event of Default, as such term is defined in the Agreement, and no event which, with notice or lapse of time, or both, would become an Event of Default, has occurred and is continuing at the date set forth below. 4. Lessee represents, covenants and warrants, that if requested by Lessor, Lessee will deliver an Opinion of Counsel, to the effect that: (i) Lessee is a fully political subdivision or agency of the State of Illinois, where the Equipment is located; (ii) the execution, delivery and performance by the Lessee of the Agreement have been duly authorized by all necessary action on the part of the Lessee; and, (iii) the Agreement constitutes a legal, valid and binding obligation of the Lessee enforceable in accordance with its terms. 5. Lessee agrees that: (i) it will do, or cause to be done, all things necessary to preserve and keep the Agreement in full force and effect; (ii) it has complied with all bidding requirements, where necessary, and by due notification presented the Agreement for approval and adoption as a valid obligation on its part; and (iii) it has sufficient appropriations, or other funds, available to pay all amounts due hereunder for the current fiscal period. General Equipment Description: Four (4) New 2003 Dodge Police Car w /ot Equipment & One (1) New 2003 Dodge 3500 Cargo Van Vehicle V.I.N.'s and Equipment Serial No(s) c LESSEE: Village of Lemont, IL �� \\ (for) Police Department Signature (Actual User of Equipment at Equipment location) Title: k Attested by: Al Title: / (Signer of Agreement) ACTUAL EQUIPMENT ACCEPTANCE DATE:/1 (45409.doc — 7/30/02 - 8464) Page 1 of 1 8038-GC (Rev. November 0000) Dk:;.-41t:roc.,c1 tht: 1 'a,Ternal Information Return for Small Tax-Exempt Governmental Bond Issues, Leases, and Installment Sales 11. Under Internal Revenue Code section 149(e) Caution: if the issue price of the issue is $100,000 or more. use Form 8038-G. No.: 8464 01113 No 1545-0720 Part 1 Reporting Authority 1 11 5 name Village of Lemont Check box if Amended Return IP- 111 2 Issuer's employer identification number 3 Number and street or P 0, box if mail is not deliveied to street address) 416 Main Street 4 City, town, or post office, 5ta1e. and ZIP 0000 Lemont, IL 60439 5 Report number 5 Room/suite 0 Want. and Wit: officer or lecii1 epie',,entative whom the P5 nay call fol more inlonnaticn Part 11 17 Te epione number el .7,fficer legaii(pest;:tutt,ve Description of Obligations Check if reporting: a single issue 1 or on a consolidated basis [11 . 8a Issue price of obligation(s) (see instructions) 8 b Issue date (sing(e issue) or calendar year (consolidated) (see instructions) 9 Amount of the reported obligation(s) on line 8a: a Used to refund prior issue(s) 9a b Representing a loan from the proceeds of another tax-exempt obligation (e.g., bond bank) 10 If the issuer has designated any iSSUe under section 265(b)(3)(B)(i)(III) (small issuer exception), check this box 11 If any obligation is in the form of a lease or installment sale, check this box XI 12 It the issuer has elected to pay a penalty in lieu of arbitrage rebate, check this box 0- n Lloder penalties of pettuly. declatt 1 that I have exornioed this re:t.it n and accompanying schecuies and statements, and 10 the he's: of my knowledcie and titc,ef. Me,/ 111 1' UM?. COT/eel, and cOnOile $82,933.00 9b Sign Here aillo—n-zeci tepTe',entotivt; Date Type 01 print name and title General Instructions section references are to the 1111101 Revenue Code unless otherwi5e noted. Purpose of Form Form 8038-GC i 5 used by the issuers of tax-exempt governmental obligafions provide the IRS with the information required by section 149(e) and to monitorihe requirements or sections 141 through 150. Who Must File ISSUCIS of tax-exempt governmenta: obligations with issue prices of less then S100,000 must 010 Form 8038-GC. Issuers of a tax-exempt governmental obligation wii0 an issue pnce of $ 100,000 or more must file Form 8038-G, Information Return for tax-Exemnt Governmental Obligations. Filing a separate return. Issuers have the option no file a separate Form 8038-GC for any tax-exempt governmental obligation with ari issue price of less than $100,000. Are issuer of a tax-exempt bond LISe CI to finance construction expenditures rnust file a separate Form 8038-GC for each issue to give notice to the IRS that an election was made to pay a penalty in lieu of arbitrage rebate (see the tine 12 instructions). Filing a consolidated return. For ail tax-exempt governmental obligations with issue prices of less than S100,000 that are not reported on 0 separate Form 8038-GC, an issuer must file a consolidated information retLrn including all such issues issued within the calendar year. Thus, an issuer may file a separate Form 8038-GC for each of a number of small issues and report the remainder of small 1,50 05 j55000 during Me calendar year 011 one consolidated Form 8038-GC. However, a separate Form 8033-GC must be filed to give the. IRS notice of the election to pay a penalty in lieu 01 arbitrage rebate. When To File To filo a separate return, file Form 8038-GC on or before the 15th day of the second calendar month after the close of the calendar quarter in which the issue is issued. To filo a consolidated return, file Form 8038-GO on or before February 15th of the calendar year following the year in which the issue is issued. Late filing. An issuer may be granted an extension of hine to file Form 8038-GC under Section 3 of Rev. Proc. 88-10, 1988-1 C.B. 635, if it is determined that the failure to file on time is not due to willful neglect. Type or print at the top of the form, "This Statement Is Submitted in Accordance with Rev. Proc, 88-10." Attach to the Form 8038-GC a letter briefly stating why the form was not submitted to the IRS on time. Also indicate whether the obligation in question is under examination by the IRS. Do not submit copies of any bond documents, leases, or installment sale documents. See Where To File below. Where To File File Form 8038-GO. and any attachments, with the internal Revenue Service Center, Ogden, LIT 84201. Other Forms That May Be Required For rebating arbitrage (or paying a penalty in lieu of arbitrage rebate) to the Federal government, use Form 8038-T, Arbitrage. Rebate and Penalty in Lieu of Arbitrage Rebate. For private activity bonds, use Form 8038, information Return for Tax-Exempt Private Activity Bond Issues. Rounding to Whole Dollars You may show the money items on this return as ktynoe-dollar amounts. To do so, drop any amount less than 50 cents and increase any amount from 50 to 99 cems to the next higher dollar. Definitions Obligations. This refers to a single tax-exempt governmental obligation it Form 8038-GO is used for separate reporting 01 10 multiple tax-exempt governmental obligations if the form is used for consolidated reporting. Tax-exempt obligation. This is a bond, installment purchase agreement, or financial lease, on which the interest is excluded from income under section 103. Tax-exempt governmental obligation. A tax-exempt obligation that is not a private activity bond (see below) i5 a tax-exempt . governmental obligation. This includes a bond issued by a qualified volunteer fire department under section 150(e). Private activity bond. This includes an obligation issued as part of an issue in which: • More than 10% of the proceeds are to be used for any private activity business use, and 011. No 041088 Form 8038-GC (Rev 11-2000) Form 803'8 -GC: (Rev. 11 -2000) Page 2 • More than 10` o of the payment of principal or interest of the issue is either (a) secured by an interest in property to be used for a private business use (or payments for such property) or (b) to be derived from payments for property (or borrowed money) used for a private business use. It also includes a bond, the proceeds of which (a) are to be used to make or finance loans (other than loans described in section 141)c)(2)) to persons other than governmental units and (b) exceeds the lesser of 5% of the proceeds or S5 million. Issue. Generally, obligations are treated as part of the same issue only if they are issued by the same issuer, on the same date, and as part Of a single transaction, or a series Of related transactions. However, obligations issued during the same calendar year (a) under a loan agreement under which amounts are to be advanced periodically (a "draw-down loan ") or (b) with a term not exceeding 270 days, may be treated as part of the same issue if the obligations are equally and ratably secured under a .single indenture or loan agreement and are issued under a common financing arrangement. (e.g„ under the same official statement periodically updated to reflect changing factual circumstances). Also, for obligations issued under a draw -down loan that meets the requirements of the preceding sentence, obligations issued during different calendar years may be treated as part of the same ..sue if all of the amounts to be advanced under We draw -down loan are reasonably expected to be advanced within 3 years of the date of issue of the first obligation. Likewise, obligations (other than private activity bonds) issued under a single agreement that is in the form of a lease or installment sale may be treated as part of the same issue if all of the property covered by that agreement is reasonably expected to be delivered within 3 years of the date of issue of the first obligation. Arbitrage rebate. Generally, interest on a gate or local bond is not tax exempt unless the issuer at the bond rebates tc, (1111 United States arbitrage profits earned from investing proceeds of the bond in higher yielding nonpurpose investments. See section 148(f). Construction issue. This is an issue of tax - exempt bonds that meets both of the following conditions: 1. At least 75% of Me available construction proceeds of the issue are to be used for construction expenditures with respect to property to be owned by a governmental unit or a 501(c)(3) organization, and 2. All of the bonds that are part of the issue are qualified 501(c)(3) bonds, bonds that are not private activity bonds. or private activity bonds issued to finance property to be owned by a governmental unit or a 501(c)(3) organization. In lieu of rebating any arbitrage that may be owed 10 the United States, the issuer of a construction issue may make an irrevocable election to pay a penalty. The penalty is equal to 1'7:`x:=, of the amount of construction proceeds that do not meet certain spending requirements. See section 148)0(4)(0) and the Instructions for Form 8038 -T. Specific Instructions In general, a Form 8038 -GC must be completed on the basis of available information and reasonable expectations as of the date the issue is issued. However, forms that are filed on a consolidated basis may be completed on the basis of information readily available to the issuer at the close of the calendar year to which the form relates, supplemented by estimates made in good faith. Part I— Reporting Authority Amended return. If this is an amended Form 8038 -GC, check the amended return box. Complete Part I and only those lines of Form 8038 -GC that are being amended. Do not amend estimated amounts previously reported ;;none the actual amounts are determined. (See the Part II instructions below.) Line 1. The issuer's name is the name of the entity issuing the obligations, not the name of the entity receiving the benefit of the financing. In the case of a lease or installment sale, the issuer is the lessee or purchaser. Line 2. An issuer that does not have an employer identification number (FIN) should apply for one on Form SS -4, Application for Employer Identification Number. This form may be obtained at Social Security Administration offices or by calling 1- 800 - TAX -FORM. If the FIN has not been received by the clue date for Forma 8038 -GO, write "Applied for" in the space for the FIN. Line 5. After the preprinted 5, enter two self - designated numbers. Number reports consecutively during any calendar year (e.g., 534, 535, etc.). Part II— Description of Obligations Line 8a. The issue price of obligations is generally determined under Regulations section 1.148 -1(b). Thus, when issued for cash. the issue price is the price at which a substantial stantial amount of the obligations are sold to the public. 10 determine the issue price of an obligation issued for property, see sections 1273 and 1274 and the related regulations. Line 8b. For a single issue, enter the date of issue, generally the date on which the issuer physically exchanges the bonds that are part of the issue for the underwriter's (or other purchaser's) funds; for a lease or installment sale, enter the date interest starts to accrue. For issues reported on a consolidated basis, enter the calendar year during which the obligations were issued. Lines 9a and 9b. For line 93, enter the amount of the proceeds that will be used to pay principal, interest, or call premium 00 any other issue of bonds, including proceeds that will be used to fund an escrow account for this purpose. Both line 9a and 9b may apply to a particular obligation. For example, report on fine 9a and 9b obligations used to refund prior issues which represent loans from the proceeds of another tax - exempt obligation. Line 11. Check this box if property other than cash is exchanged for the obligation, e.g., acquiring a police car, a fire truck, or telephone equipment through a series of monthly payments. (This type of obligation is sometimes referred to as a "municipal lease. ") Also check this box if real property is directly acquired in exchange for an obligation to make periodic payments of interest and principal. Do not check this box if the proceeds of the obligation are received in the form of cash, even if the term "lease" is used in the title of the issue. Line 12. Check this box if the issue is a construction issue and an irrevocable election to pay a penalty in lieu of arbitrage rebate has been made on or before the date the bonds were issued. The penalty is payable with a Form 8038 -T for each 6 -month period after the date 1110 bonds are issued. Do not make any payment of penalty in lieu of rebate with Form 8038 -GC. See Rev. Proc. 92 -22, 1992 -1 C.B. 736, for rules regarding the election document." Paperwork Reduction Act Notice We ask for the information on this form to carry out the Internal Revenue laws of the United States. You are required to give us the information. We need it to ensure that you are complying with these laws. You are not required to provide the information requested on a form that is subject. to the Paperwork Reduction Act unless the form displays a valid OMB control number. Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law. Generally, tax returns and return information are confidential, as required by section 6103. The time needed to complete and file this form varies depending on individual circumstances. The estimated average time is: Learning about the law or the form . . Preparing the form . Copying, assembling, and sending the form to the IRS 1 hr., 58 min. . . 3 hr., 3 min. , 16 min. If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would be happy to hear frorn you. You can write to the Tax Forms Committee, Western Area Distribution Center, Rancho Cordova, CA 95743 -0001. Do not send the form to this address. Instead, see Where To File on page 1. Please replace this page with a copy of approved resolution or minutes of the Lessee approving this transaction. Please replace this page with the bid, response and award concerning this transaction. (if applicable) Please replace this page with the Certificate of Origin or Title related to this transaction. Lienholder will be listed on back of Certificate of Origin and should be applied to the Title MUNICIPAL CERTIFICATE MUNICIPAL LEASE AND OPTION AGREEMENT NO. 8464 GOVERNMENT LEASING COMPANY ( "LESSOR ") VILLAGE OF LEMONT, ( "LESSEE ") DATED: I, the undersigned, the duly appointed, qualifying and acting Clerk or Secretary of the aforementioned Lessee, do hereby certify: 1. Lessee did at a regular or special meeting of the governing body of the Lessee held on X , 200 by motion duly made seconded and carried, in accordance with all requirements of law, approve and authorize the execution and delivery of the above - referenced Municipal Lease and Option Agreement (the "Agreement ") on its behalf by the following named representative of the Lessee: (OFFICIAL WHO WILL SIGN THE AGREEMENT) (typed /printed name) x k (official title) (signature) 2. A true, correct and complete copy of the minutes of the governing body is attached hereto. 3. The above -named representative of the Lessee held at the time of such authorization and holds at the present time the office set forth above. 4. No event or condition that constitutes, or with the giving of notice or the lapse of time or both would constitute, an Event of Default (as such term is defined in the Agreement) exists at the date hereof. 5. All insurance required by the Agreement is currently maintained by the Lessee. 6. Lessee has in accordance with the requirements of law, fully budgeted and appropriated sufficient funds for the current budget year to make the Lease Payments scheduled to come due during the Original Term and to meet its other obligations for the Original Term (as such terms are defined in the Agreement) and such funds have not been expended for other purposes. IN WITNESS WHEREOF, I hereunto set my hand and the seal of the governing body of the Lessee the day and year above written. (Clerk's or Secretary's signature) x (typed /printed name & title) Date (45426.doc — 5/7/02 - 8464) NOTE: THIS LETTER SHOULD BE RE -TYPED ON THE LETTERHEAD OF THE LESSEES ATTORNEY. OPINION OF COUNSEL , 200 Government Leasing Company P.O. Box 60519 Colorado Springs, CO 80960 -0519 Ladies /Gentlemen: I have acted as Counsel to the Village of Lemont, IL (the "Lessee ") with respect to the certain Municipal Lease and Option Agreement No. 8464 (the "Agreement ") dated by and between Government Leasing Company (the "Lessor ") and the Lessee. I have reviewed the Agreement and such other documents, records and certificates of the Lessee, and appropriate public officials as I have deemed relevant, and I am of the opinion that: 1. The Lessee validly exists as a political subdivision or agency of the State of Illinois, with a substantial amount of one or more of the tax, eminent domain and police powers, or is an agency, of the State of Illinois. 2. The execution, delivery and performance of the Agreement and other documents delivered in connection with the Agreement by / (typed or printed name official signing Agreement / title of that official) has been duly authorized by all necessary action on the part of the Lessee. 3. The Agreement has been duly authorized, executed and delivered by the lessee and constitutes a legal, valid and binding obligation of the Lessee and it is enforceable in accordance with its terms. In the event the lessor obtains a judgment against the lessee as a result of a default, the lessee will be obligated to pay such judgment. 4. There is no proceeding pending or threatened in any court or before any governmental authority or arbitration board or tribunal that, if adversely determined, would adversely affect the transactions contemplated by the Agreement or the security interest of Lessor or its assigns, as the case may be, in the Equipment. 5. Lessee is a political subdivision within the meaning of Section 103 of the Internal Revenue Code of 1986, as amended, and the related regulations and rulings issued with reference thereto, and the portion of the payments identified as deferred interest charges to maturity will not be includable in the gross income of the recipient and will therefore be exempt from income taxation under federal law and the laws of the State of Illinois. Very Truly Yours (Counsel for the Lessee) NOTE: IF THE ATTORNEY HAS ANY QUESTIONS OR CONCERNS, OR IF ANY CHANGES ARE REQUIRED, PLEASE CALL US DIRECTLY AT (719) 576 -8800 OR (800) 822 -8070. THANK YOU. (45425.doc — 5/7/02 - 8464) THIS IS A SAMPLE OF THE INFORMATION REQUIRED ON YOUR PURCHASE ORDER AND IS NOT TO BE USED AS AN ACTUAL DOCUMENT. IF YOU DO NOT HAVE A STANDARD PURCHASE ORDER YOU MAY USE THE FOLLOWING ON YOUR LETTERHEAD AS A PURCHASE ORDER. PURCHASE ORDER DATE PURCHASE ORDER NO. AGENCY ISSUING PURCHASE ORDER ( "LESSEE "): Village of Lemont (For) Police Department 416 Main Street Lemont, IL 60439 (630) 257 -5957 TO: Thomas Dodge of Orland Park 15941 South 94th Ave. Orland Park, IL 60462 SHIP TO: Name: Address: City /State: Contact: QUANTITY ORDERED EQUIPMENT DESCRIPTION TOTAL PRICE 1 Equipment Description: Serial No. $82,933.00 [DESCRIBE EACH ITEM OF EQUIPMENT] Lessee anticipates entering into a Municipal Lease and Option Agreement (the "Agreement ") with Government Leasing Company ( "Lessor ") concerning the Equipment described above. Upon execution and delivery of the documents required by the Lessor and acceptance of the Equipment, the rights and obligations of the Lessee under this purchase order shall be deemed assigned to Lessor who will assume and agree to pay the obligations described herein and upon such assignment, Lessee shall make 3 payments to Lessor, with (i) 1 Advance Payment(s) of $31,051.00, and (ii) the remaining amounts payable in Annual payments of $31,051.00 as described in the Agreement. APPROVING SIGNATURE (Director of Purchasing) (Authorized Personnel) (45412.doc — 7/2/02 - 8464) Government Leasing Company (719) 576 - 8800 /Fax: (719) 576 -0370 P.O. Box 60519 Colorado Springs,CO 80960 -05199 TO: Accounts Payable Village of Lemont (for) Police Department 416 Main Street Lemont, IL 60439 INVOICE FOR PAYMENT Date of Invoice: May 21, 2003 Lease Number: 8464 Purchase Order Number: Equipment Description: Four (4) New 2003 Dodge Police Car w /ot Equipment & One (1) New 2003 Dodge 3500 Cargo Van Amount Due: $31,051.00 When Payment is Due: UPON ACCEPTANCE OF EQUIPMENT Make Check Payable to: Government Leasing Company P.O. Box 60519 Colorado Springs,C0 80960 -0519 Should you have any questions regarding this invoice, please call us at (719) 576 -8800 or send a FAX to 719- 576 -0370. jr, Sharon M. Faires Contract Administrator (45413.doc1 — 12/10/01 - 8464) Please replace this page with the lessee's certificate of insurance concerning the equipment that is the subject of this transaction. Please replace this page with Interim Financial information that covers the period of April 2002 up to this date.