Municipal lease and option agreement[5]

Municipal lease and option agreement. MUNICIPAL LEASE AND OPTION AGREEMENT Lessor: ...................................................................................................... Lessee: ...................................................................................................... Property: See Exhibit A attached hereto and made a part hereof. Rent: See Exhibit B attached hereto and made a part hereof, and paragraph 2. Stipulated Value: See Exhibit B attached hereto and made a part hereof. Commencement Date: ...................................................................................................... After discussions with the Supplier's Representative for the Property described on Exhibit A, Lessee has selected the Property and desires to lease the Property for use in its business. To facilitate the financing of this agreement, Municipal Funding Corporation of America has agreed to purchase the Property and transfer it to Lessee pursuant to the terms of this agreement. For purposes of the financing arrangement set forth in this agreement Municipal Funding Corporation of America is referred to as the "Lessor". The parties agree as follows: 1. Lease. Lessor hereby rents and leases to Lessee and Lessee hereby rents and leases from Lessor the Property for a term of one year from the Commencement Date. Unless Lessee notifies Lessor at least thirty 30 days prior to the end of the initial term or any renewal term (see Exhibit B), this agreement will automatically be renewed for the next renewal term until all scheduled renewal terms have been completed. 2. Rent. (a) Lessee agrees to pay rent for the initial term and any renewal terms at the rate stated in Exhibit B. The rental amounts include interest on the Principal Cost of the Property. All rentals shall be paid to Lessor at its offices, 155 S. Madison St., Denver, Colorado 80209, or to such other person or entity and at such other place as Lessor may from time to time designate by written notice to Lessee. (b). The parties understand that as long as Lessee has sufficient appropriated funds to make the payments hereunder, it will keep this agreement in effect through all the renewal terms and make all payments or it will exercise its option under paragraph 13 to purchase the Property. If Lessee does not have sufficient appropriated funds so that this agreement is not renewed for an available renewal term, the Lessee shall not, until the date on which the last renewal term would have ended, expend any funds for the purchase or use of property similar to the Property subject to this agreement. The preceding sentence shall not apply if Lessee has purchased the Property under paragraph 13. (c). By giving not less than 90 days prior written notice, Lessee may cancel this agreement for its convenience at the end of the initial term or any renewal term pursuant to paragraph 1. In the event of a convenience cancellation by the Lessee, the Lessee shall pay to Lessor on demand the interest accrued on the Principal Balance, if any, plus an amount equal to the Stipulated Value of the Property. For this purpose, the interest will be computed on the Principal Balance outstanding at the time of the last rental payment due date and the Stipulated Value will be the amount of the Stipulated Value at the time of the last rental payment due date (see Exhibit B). 3. Taxes; Permits. (a) Lessee agrees to pay, and to indemnify, and hold Lessor harmless from, all imposed or levied with respect to the Property or the ownership, delivery, lease, possession, use, operation, sale or other disposition thereof or upon the rentals or earnings arising therefrom, except any federal or state income taxes payable by Lessor. Lessee may in good faith and by appropriate proceedings contest any such taxes so long as such proceedings do not involve any danger of sale, forfeiture or loss of the Property or any interest therein. (b). Lessee shall provide all permits and licenses necessary for the installation, operation and use of the Property. Lessee shall comply with all laws, rules, regulations and ordinances applicable to the installation, use, possession and operation of the Property. If compliance with any law, rule, regulation, ordinance, permit or license requires changes or additions to be made to the Property, such changes or additions shall be made by the Lessee at its own expense. 4. Utilities. Lessee shall pay all charges for gas, water, steam, electricity, light, heat or power, telephone or other utility service furnished to or used on the Property (including charges for installation of such services) during the term of this agreement and any renewal terms. There shall be no abatement of rent on account of the interruption of any such services. 5. Use. Lessee will not install, use, operate or maintain the Property improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by this agreement. 6. Repairs. (a) At its own cost and expense. Lessee shall service, repair and maintain the Property so as to keep the Property in as good condition, repair, appearance and working order as when delivered to Lessee hereunder, ordinary wear and tear excepted. At its own cost and expense Lessee shall replace any and all parts and devices which may from time to time become worn out, lost, stolen, destroyed, damaged beyond repair or rendered unfit for use for any reason whatsoever. All such replacement parts, mechanisms and devices shall be free and clear of all liens, encumbrances and rights of others, and shall become the property of Lessor and shall be covered by this agreement to the same extent as the Property originally covered by this agreement. (b). Lessor shall not be liable or responsible to Lessee for any loss, damage, liability or expense of any kind caused by or related to the Property, or resulting from any defect in or deficiency of the Property, or resulting from the use or operation of the Property. 7. Alterations. Lessee may install such miscellaneous equipment as may be necessary for using the Property for its intended purposes. All such equipment placed or installed on the Property may be removed by Lessee upon termination of this agreement provided that removal will not substantially damage the Property. Without the prior written consent of Lessor, Lessee shall not make any other alterations, changes, modifications, additions or improvements to the Property except those needed to comply with Lessee's obligation under paragraph 6. Any alterations, changes, modifications, additions and improvements made to the Property shall immediately become the property of Lessor. 8. Liens. Lessee shall not directly or indirectly create, incur, assume or suffer to exist any mortgage, pledge, lien, charge, encumbrance or claim on or with respect to the Property or any interest therein. Lessee shall promptly, at its own expense, take such action as may be necessary to duly discharge any such mortgage, pledge, lien, charge, encumbrance or claim if the same shall arise at any time. 9. Damage to or Destruction of Property. (a) In the event all or any part of the Property is lost, stolen, destroyed or damaged beyond repair, Lessee shall replace the same at Lessee's sole cost and expense within 30 days after such event and such replacement shall be substituted in this agreement by appropriate endorsement. If Lessee fails or refuses to replace such Property within the required period, Lessor may at its option declare an amount equal to the then current option purchase price for such Property (as specified in paragraph 13 hereof) due and payable. Upon such payment, this agreement such Property as-is-where-is without warranty, express or implied, with respect to any matter whatsoever except that such Property shall not be subject to any lien or encumbrance created by or arising through Lessor. All insurance proceeds received by Lessor under the policies required under paragraph 11 hereof with respect to the Property lost, stolen, destroyed or damaged beyond repair shall be paid to Lessee if such Property is replaced by Lessee as required hereunder, or if Lessee fails or refuses to make the required replacement, shall be credited against the amount of the then current option purchase price payable by Lessee. (b). No loss or damage to the Property or any part thereof shall impose any obligation on Lessor under this Agreement which shall continue in full force and effect. Lessee assumes all risks and liabilities, whether or not covered by insurance, for loss or damage to the Property and for injuries or deaths of persons and damage to Property, however arising from or incident to the use, operation or storage of the Property, whether such injury or death be with respect to agents or employees of the Lessee or of third parties, and whether such damage to Property be to Lessee's Property or the Property of others. 10. Indemnification. Lessee hereby assumes liability for and agrees to indemnify, protect, save and keep harmless Lessor from and against any and all liability, obligations, losses, damages, penalties, claims, actions, costs and expenses (including attorneys' fees) of whatsoever kind and nature imposed on, incurred by or asserted against Lessor which in any way relate to or arise out of ownership, delivery, lease, possession, use, operation, condition, sale or other disposition of the Property. 11. Insurance. At its own cost and expense, Lessee shall cause casualty insurance to be carried and maintained on all Property and shall carry public liability and property damage insurance, with all such coverage to be in such amounts, against such risks, in such form and with such insurers as Lessor may specify from time to time. All insurance policies shall name both Lessor and Lessee as insured. Insurance proceeds from casualty losses to the extent of the then current option price of the respective Property shall be payable solely to Lessor. Lessee shall deliver to Lessor the policies of evidence of insurance satisfactory to Lessor, together with receipt for the initial premiums before the Property is delivered to the Lessee. Renewal policies, together with receipts showing the payment of the applicable premiums, shall be delivered to Lessor at least 30 days before termination of the policies being renewed. By endorsement upon the policy or by an independent instrument furnished to Lessor, each insurer shall agree that it will give Lessor at least 30 days' written notice prior to cancellation or alteration of the policy. Lessee shall also carry workmen's compensation insurance covering all its employees working on, in or about the Property and shall require any other person, corporation, partnership or other entity working on, in or about the Property to carry such coverage, and will furnish to Lessor certificates evidencing such coverage throughout the term of this agreement. 12. Representations and Warranties. (a) Lessor, at the request of Lessee, has ordered or will order the Property described on Exhibit A. The Property has been selected by Lessee and Lessor shall not be liable for specific performance of this agreement or for damages if for any reason the supplier fails to accept such order or delays or fails to fill the order. Lessee agrees to accept such Property and authorizes Lessor to add the serial number of the Property to Exhibit A. Lessor shall have no obligation to install, erect, test, inspect, or service the Property. (b). Lessor hereby assigns to Lessee for and during the term of this agreement all manufacturer's warranties and guarantees, expressed or implied, issued on or applicable to the Property and Lessor authorizes Lessee to obtain the customary services furnished in connection with such warranties and guarantees at Lessee's expense. Lessee acknowledges that the Property has been purchased by Lessor in accordance with Lessee's specifications and from vendors selected by Lessee and that Lessor is not a manufacturer of or a dealer in such Property. LESSOR MAKES NO EXPRESS OR IMPLIED WARRANTIES INCLUDING, BUT NOT LIMITED TO: THE MERCHANTABILITY DESIGN, CONDITION OR WORKMANSHIP; ITS FREEDOM FROM PATENT INFRINGEMENT; THE ENFORCEABILITY OF THE MANUFACTURER'S WARRANTIES AND GUARANTEES; OR AS TO THE TAX OR ACCOUNTING TREATMENT OF THE LEASE OF THE PROPERTY, AND HEREBY DISCLAIMS THE SAME. (c). Lessee has made the selection of each item of Property based upon its own judgment and expressly disclaims any reliance upon any statements or representations made by Lessor or any persons on Lessor's behalf. LESSOR IS NOT RESPONSIBLE FOR ANY REPAIRS OR SERVICE TO THE PROPERTY, DEFECTS THEREIN, OR FAILURES IN THE INSTALLATION OR OPERATION THEREOF, LESSOR SHALL NOT BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY CHARACTER AS A RESULT OF LEASE OF THE PROPERTY, INCLUDING WITHOUT LIMITATION LOSS OF PROFITS, PROPERTY DAMAGE OR LOST PRODUCTION, WHETHER SUFFERED BY LESSEE OR ANY THIRD PARTY. (d). Lessor is not responsible for, and shall not be liable to Lessee for damage resulting from the inoperability or loss of value of the Property due to any cause or situation (including without limitation governmental actions or regulations or actions of other third parties) whether or not presently foreseeable. (e). Lessee represents and warrants that it has power to enter into this agreement, that all required procedures for execution of this agreement, including competitive bidding if applicable, have been complied with, and that all rentals will be paid out of funds which are legally available for such purposes. 13. Option To Purchase. Lessee shall have the option to purchase the Property at the end of the initial term or any renewal term for a purchase price equal to the Stipulated Value of the Property as of the end of such term plus the interest accrued on the Principal Balance, if any, since the last rental payment due date (see Exhibit B). The purchase option is exercisable by written notice to Lessor not less than 30 days prior to the end of the current term. The closing shall be within 10 days of the end of the current term at the offices of Lessor. At the closing, Lessor will deliver to Lessee a bill of sale transferring the Property to Lessee free from any lien or encumbrance created by or arising through Lessor, but without other warranties, and will deliver all warranties and guarantees of the dealers and manufacturers of the Property that the Lessor has in its possession. 14. Default. In the event Lessee fails to pay rent or any other amount herein provided when due and payable, or in the event the Lessee fails to perform promptly any of the other obligations or covenants herein or under any other agreement between the parties, or if Lessee breaches the representations or warranties set forth herein, or if Lessee shall become bankrupt, then in any such event Lessor may pursue one or more of the following remedies (which shall be cumulative and exercisable concurrently or separately) as Lessor in its sole discretion may elect: (a). Terminate this agreement and repossess the Property leased hereunder, in which event the rent for the remainder of the term or any other charge provided for herein which is unpaid shall become immediately due and payable. (b). Repossess and lease the Property or any portion thereof for such period and rental and to such other persons as Lessor may elect, and apply the proceeds of any such leasing, after deducting the costs and expense of repossessing, repairing, storing and leasing, in payment of the rent and the other obligations of Lessee hereunder. (c). Repossess and sell the Property or any portion thereof at public or private sale without costs and expenses of repossessing, repairing, storing and selling the Property (including attorney's fees not to exceed 18 percent of the balance of the rentals hereunder at the time of default), in payment of the rent and other obligations of Lessee hereunder. Lessor may purchase the Property at such sale. (d). Any remedy available at law or in equity. With respect to all such remedies, Lessee hereby expressly waives any damages occasioned by the repossession, and if any Property has been lost, stolen, destroyed or damaged beyond repair, Lessee shall pay to Lessor an amount equal to the then current option purchase price for such Property as specified in paragraph 13 hereof (less the credit for insurance proceeds) to Lessor. 15. Termination. Upon the expiration of this agreement or the earlier termination thereof, Lessee shall return the Property to Lessor in the condition, repair, appearance and working order required in paragraph 6 hereof (unless Lessee has paid Lessor the then current option purchase price for such Property), in the following manner as may be specified by Lessor: (a). By delivering the Property at Lessee's cost and expense to such place as Lessor shall specify within the continental United States. (b). By loading such item of Property at Lessee's cost and expense, on board such carrier as Lessor shall specify and shipping the same, freight prepaid, to the destination designated by Lessor. Lessee shall obtain all governmental authorization to permit return of the Property to Lessor and Lessee shall pay to Lessor such sum as may be necessary to cover replacement of all broken or missing parts. Lessee shall pay rentals on the Property at the rate provided in paragraph 2 and Exhibit B until the Lessee has delivered the Property to Lessor as provided in (a) and (b) above, including during the period of any delay caused by the lack of governmental authorization to return the Property to Lessor. 16. Assignment and Sublease. (a) Without the prior written consent of Lessor, Lessee shall not: (i) assign, transfer, pledge, or hypothecate this agreement, the Property or any part thereof, or any interest therein, or (ii) sublet the Property or any part thereof, or permit the Property to be used for any purposes not permitted by paragraph 5. Consent to any of the foregoing prohibited acts shall not constitute a consent to any subsequent like act by Lessee or any other person. (b). It is understood that Lessor may assign this agreement or mortgage the Property and that said assignee may assign the same. All rights of Lessor hereunder may be assigned, pledged, mortgaged, transferred or otherwise disposed of, either in whole or in part, without notice to or consent of the Lessee. If Lessor assigns this agreement or the rentals due or to become due hereunder, or any other interest herein, whether as security for any of its indebtedness or otherwise, no breach or default by Lessor hereunder or pursuant to any other agreement between Lessor or Lessee, should there be one, shall excuse performance by Lessee of any provision hereof. 17. Personal Property. The Property is and shall at all times be and remain personal property notwithstanding that the Property or any part thereof may not be or hereafter become in any manner affixed or attached to or embedded in or permanently rested upon real property or any building thereon or attached in any manner to what is permanent by any means of cement, plaster, nails, bolts, screws or otherwise. 18. Title. Title to the Property shall be in the Lessee, subject to the terms and conditions of this agreement and Lessee's obligations hereunder. Lessor represents and warrants that it has not created any lien or encumbrance on the Property except the lien for payment of the amount due under this agreement. Title shall immediately vest in Lessor if Lessee shall default or terminate hereunder. Lessor shall at all times have access to the Property for the purpose of inspecting it, observing its operations or of altering, repairing and improving the Property. 19. Lessor's Right To Perform for Lessee. If Lessee fails to make any payment or fails to perform or comply with any of its covenants or obligations, Lessor may at its election, make such payment or perform or comply with such covenants and obligations and the amount of such payment and the expenses incurred by Lessor in performing or complying with such covenants and obligations, as the case may be, together with interest thereon at the highest legal rate shall be deemed additional rent payable by Lessee upon demand. 20. Interest. If Lessee fails to pay any rental or other amount due hereunder within 10 days after the due date thereof, Lessee shall pay to Lessor interest on such delinquent payment from the due date until paid at the rate of _________ percent per annum. 21. Offset. Rentals or other sums payable by Lessee pursuant to this agreement shall not be subject to set-off, deduction, counterclaim or abatement and Lessee shall not be entitled to any credit against such rental or other sums for any reason whatsoever, including, but not limited to any damage or destruction of the Property or any restriction or interference with Lessee's use of the Property. 22. Nonwaiver. No covenant or obligation to be performed by Lessee may be waived except by the written consent of Lessor. Forbearance or indulgence by Lessor in any regard whatsoever shall not constitute a waiver of the covenant or obligation and until complete performance by Lessee of said covenant or obligation Lessor shall be entitled to invoke any remedy available to it under this agreement despite said forbearance or indulgence. No collection of rent shall operate as a waiver of any default. 23. Notices. All notices to be given under this agreement shall be made in writing and mailed to the other party at its address set forth herein or at such address as the party may provide in writing from time to time. Any such notice shall be deemed to have been received 72 hours after mailing of this agreement between the parties. 24. Additional Provision. The provisions set forth in Addendum I to this instrument are incorporated herein by reference and are made a part of this agreement between the parties. 25. Miscellaneous. (a) This agreement shall be construed and governed in accordance with the laws of the State of Colorado. (b). This agreement and the exhibits attached hereto constitute the entire agreement between the parties and this agreement shall not be modified, amended, altered or changed except by a written document signed by both parties. (c). Any provision of this agreement found to be prohibited by law shall be ineffective to the extent of such prohibition without invalidating the remainder of this agreement. (d). Subject to the provision of paragraph 16, this agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. (e). The parties agree to execute such additional documents as may be appropriate to carry out the provisions of this agreement. (f). The provisions of paragraphs 2, 10 and 12 shall survive termination of this agreement. In witness whereof, the parties have executed this agreement this _________ day of _________, 19__. Attest: _________ LESSOR: _________ By _________ My Commission expires _________, 19__. Title _________ LESSEE: _________ By _________ Title _________ By _________ Title _________ Exhibit “A”. DESCRIPTION OF PROPERTY One (1) _________ Corporation Model 20 Motor Grader Exhibit “B”. PAYMENT PRINCIPAL OUTSTANDING INTEREST PRINCIPAL REPAYMENT PAYMENT TAXES DUE TOTAL PAYMENT STIPULATED VALUE 100000.00 1 96689.13 0.00 3310.87 3310.87 132.43 3443.30 1 05300.47 2 94385.44 1007.18 2303.69 3310.87 132.43 3443.30 102559.14 3 92057.75 983.18 2327.69 3310.87 132.43 3443.30 99803.80 4 89705.81 958.93 2351.94 3310.87 132.43 3443.30 97033.54 5 87329.38 934.44 2376.43 3310.87 132.43 3443.30 94248.27 6 84928.19 909.68 2401.19 3310.87 132.43 3443.30 91447.91 7 82501.99 884.67 2426.20 3310.87 132.43 3443.30 88632.38 8 80050.52 859.40 2451.47 3310.87 132.43 3443.30 85801.60 9 77573.51 833.86 2477.01 3310.87 132.43 3443.30 82955.49 10 75070.70 808.06 2502.81 3310.87 132.43 3443.30 80093.96 11 72541.82 781.99 2528.88 3310.87 132.43 3443.30 77216.93 12 69986.59 755.64 2555.23 3310.87 132.43 3443.30 74324.32 RENEWAL PERIOD 1 13 67404.75 729.03 2581.84 3310.87 132.43 3443.30 71416.04 14 64796.01 702.13 2608.74 3310.87 132.43 3443.30 68492.01 15 62160.10 674.96 2635.91 3310.87 132.43 3443.30 65552.14 16 59496.73 647.50 2663.37 3310.87 132.43 3443.30 62596.34 17 56805.62 619.76 2691.11 3310.87 132.43 3443.30 59624.54 18 54086.48 591.73 2719.14 3310.87 132.43 3443.30 56636.63 19 51339.01 563.40 2747.47 3310.87 132.43 3443.30 53632.54 20 48562.92 534.78 2776.09 3310.87 132.43 3443.30 50612.18 21 45757.91 505.86 2805.01 3310.87 132.43 3443.30 47575.46 22 42923.68 476.64 2834.23 3310.87 132.43 3443.30 44522.29 23 40059.93 447.12 2863.75 3310.87 132.43 3443.30 41452.59 24 37166.35 417.29 2893.58 3310.87 132.43 3443.30 38366.25 RENEWAL PERIOD 2 25 34242.63 387.15 2923.72 3310.87 132.43 3443.30 35263.20 26 31288.45 356.69 2954.18 3310.87 132.43 3443.30 32143.34 27 28303.50 325.92 2984.95 3310.87 132.43 3443.30 29006.58 28 25287.46 294.83 3016.04 3310.87 132.43 3443.30 25852.83 29 22240.00 263.41 3047.46 3310.87 132.43 3443.30 22681.99 30 19160.80 231.67 3079.20 3310.87 132.43 3443.30 19493.98 31 16049.52 199.59 3111.28 3310.87 132.43 3443.30 16288.71 32 12905.83 167.18 3143.69 3310.87 132.43 3443.30 13066.07 33 9729.40 134.44 3176.43 3310.87 132.43 3443.30 9825.97 34 6519.88 101.35 3209.52 3310.87 132.43 3443.30 6568.32 35 3276.93 67.92 3242.95 3310.87 132.43 3443.30 3293.03 36 0.00 33.94 3276.93 3310.87 132.43 3443.30 0.00 TOTALS 19191.32 100000.00 119191.32 4767.65 123958.97 Commencement Date _________ First rental payment due _________ Subsequent rental payments due _________monthly thereafter commencing on _________, 19__ Lease No. _________ MUNICIPAL CERTIFICATE I, _________, City Manager of _________, hereby certify that the Municipal Lease and Option Agreement dated _________, 19__, between Municipal Funding Corporation of America, as Lessor and _________ as Lessee, leasing the Property described in Exhibit "A" attached to the Municipal Lease and Option Agreement, was executed by me on the _________ day of _________, 19__; that I have full power and authority to execute the Municipal Lease and Option Agreement and that the power to enter into the Municipal Lease and Option Agreement granted to me by the _________ has not been withdrawn, and that all required procedures necessary to make the Municipal Lease and Option Agreement a legal and binding obligation of the Lessee have been followed. I also do hereby certify that payments due by the _________ under the Municipal Lease and Option Agreement referred herein for the current lease term are within the current budget and within an available, unexhausted and unencumbered appropriation of the _________. In witness whereof, I have set my hand this _________ day of _________, 19__. Attest: _________(Signature) Agency Official: _________ (Signature) _________(Title) _________(Title) Lease No. _________ MUNICIPAL PROPERTY ACCEPTANCE The undersigned Lessee, under that certain Municipal Lease and Option Agreement dated _________, 19__, with _________ Funding Corporation of America, as Lessor, hereby acknowledges receipt in good condition of all the Property described on Exhibit A to the Municipal Lease and Option Agreement, hereby accepts the Property and hereby certifies that the Lessor has fully and satisfactorily performed all covenants and conditions to be performed by it under the Municipal Lease and Option Agreement. Dated: _________, 19__. Lessee: _________ By _________ Municipal Administrator LEASE COMPLETION INSTRUCTIONS MUNICIPAL AGREEMENT THE INSTRUCTIONS BELOW MUST BE FOLLOWED SO THAT WE CAN PROCESS YOUR MUNICIPAL AGREEMENT Documents and material enclosed: (A). Two copies of the Municipal Agreement (B). Uniform Commercial Code Financing Statement, UCC-1 (C). Insurance Coverage Information (D). Invoice for the first payment PLEASE COMPLETE AND RETURN THE FOLLOWING: 1. Please read and sign both copies of the Municipal Agreement where indicated (x) and return both copies to our office. Also, please sign the Certificate and have another qualified representative within the organization attest to your authority with his or her signature. The Property Acceptance should be signed and returned to us at the time that the property has been received and is acceptable. This document initiates the commencement of the Agreement and should be dated on the 10th of the month nearest the acceptance date. 2. Please sign the UCC-1 form where it says "signature of debtor." Return all copies to us except debtor copy. 3. Please provide proof of the required insurance coverage (see paragraph 11 of the Agreement) as specified on the Insurance Coverage Information sheet. If your governmental entity is self-insured, please send us a letter stating that the self-insurance provides the coverage specified on the Insurance Coverage Information sheet. 4. In addition to the above, please send us the following items marked with an (x): ( ) Check for the first _________ payment. ( ) Financial Statement (Audit Report) for the most recent fiscal year. ( ) Usage Letter which describes in reasonable detail the specific usage of the property, a statement to the fact that the property is essential to the efficient operation of your organization, and the expected useful life of the property to your organization. ( ) An Opinion Letter from your legal counsel stating that your organization is a duly constituted political subdivision, that the person(s) who signed the Agreement is authorized to do so, and that the Agreement is a legal, valid and binding obligation of your organization. Please complete and return the items requested in Sections 1, 2 and 4 above. The insurance information requested in Section 3 may be forwarded at a later date but must be received by us prior to delivery of the property. Upon receipt of the items requested in Sections 1, 2 and 4, we will issue our purchase order to the vendor for the property that you wish to acquire. When the property has been received and accepted by you and all documentation has been completed and received by us, we will complete our section of the Agreement and return a signed copy to you. Thank you for your cooperation. Please do not hesitate to call us if you should have any questions about the Agreement or completion details. _________ Funding Corporation of America