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4. NONAPPROPRIATION. Funds for payment for the services described in this Contract have been provided through the City
<br />budget approved by City Council for the current fiscal year only. State statutes prohibit the obligation and expenditure of public
<br />funds beyond the fiscal year for which a budget has been approved. However, the cost of services covered by this Contract is
<br />considered a recurring requirement and is included as a standard and routine expense of the City to be included in each proposed
<br />budget within the foreseeable future. The City expects this to be an integral part of future budgets to be approved during the period
<br />of the Contract. However, the City cannot guarantee the availability of funds, and enters into the Contract only to the extent such
<br />funds are made available. If funding for continuation of the Contractor's services is not available, the City may terminate this
<br />Contract by providing 30 calendar days written notice to the Contractor. The fiscal year for the City extends from October 1s` of each
<br />calendar year to September 30` of the following calendar year.
<br />5. TAX WARRANTY. Lessee is validly existing as a body corporate and politic and public instrumentality of the State with the power
<br />and authority to enter into this Agreement and to cant' out its obligations hereunder and the transactions contemplated hereby.
<br />Lessee shall, at all times, do and perform all acts and things necessary and within its control in order to assure that the interest
<br />component of the Lease Payments received by the Lessor shall, for the purposes of Federal income taxation, be excluded from the
<br />gross income of the Lessor and shall not take or permit any act or thing that could cause the interest component of the Lease
<br />Payments received by the Lessor to be included in the gross income of the Lessor for the purposes of Federal income taxation. The
<br />Equipment will not be used in any trade or business carried on by a person other than Lessee. Lessee will report this Lease
<br />Purchase to the Internal Revenue Service by filing Form 8038G, 8038C or 8038 whichever is applicable. Failure to do so will cause
<br />the agreement to lose its tax exempt status. Lessee agrees that if the appropriate form is not filed, the interest rate will be adjusted
<br />to the equivalent taxable interest rate.
<br />6. ASSIGNMENT. Lessee may not, without Lessor's written consent, by operation of law or otherwise, assign, transfer, pledge,
<br />hypothecate or otherwise dispose of its right, title and interest in and to this Agreement and the Equipment and /or grantor assign a
<br />security interest herein, in whole or in part. Lessor may not transfer, sell, assign, pledge, hypothecate. or otherwise dispose of its
<br />right, title and interest in and to this Agreement and the Equipment and /or grant or assign a security interest herein, in whole or, in
<br />part.
<br />7. INDEMNITY. To the extent permitted by law, Lessee assumes liability for, agrees to and does hereby indemnity, protect and
<br />hold harmless Lessor and its agents, employees, officers, directors, subsidiaries and stockholders from and against any and all
<br />liabilities, obligations, losses, damages, injuries, claims, demands, penalties, actions, costs and expenses (including reasonable
<br />attorney's fees), of whatsoever kind and nature, arising out of the use, condition (including, but not limited to, latent and other
<br />defects and whether or not discoverable by Lessee or Lessor), operation, ownership, selection, delivery, storage, leasing or return of
<br />any item of Equipment, regardless of where, how and by whom operated, or any failure on the part of Lessee to accept the
<br />Equipment or otherwise to perform or comply with any conditions of this Agreement. The indemnities contained in this Paragraph
<br />shall continue in full force and effect notwithstanding the termination of this Agreement. Lessee is an independent contractor and
<br />nothing contained in this Agreement shall authorize Lessee or any other person to operate or use any Equipment so as to incur any
<br />obligation on behalf of Lessor or impose any liability on Lessor. Nothing in this Agreement is intended nor should any
<br />provision of this Agreement be construed to, limit, waiver, abridge or otherwise modify any rights, claims, or causes of
<br />action that the Lessee may have against any person or entity other than Lessor.
<br />8. LOSS AND DAMAGE. Lessee shall bear the entire risk of loss, theft, destruction or damage to the Equipment or any part thereof
<br />from any cause whatsoever. No loss, theft, destruction or damage of the Equipment shall relieve Lessee of the obligation to make
<br />Lease Payments or to perform any obligation owing hereunder. In the event of loss theft, destruction or damage of any kind to any
<br />item of the Equipment, Lessee shall immediately notify Lessor and, at the option of Lessor, shall: (a) place the same in good repair,
<br />working order and condition (ordinary wear and tear excepted); or (b) replace the same with like equipment in good repair, working
<br />order and condition (ordinary wear and tear excepted). The "net proceeds" (as defined in the last sentence of this Paragraph) of any
<br />insurance recovery shall be applied to clause (a) or (b) as provided above unless an Event of Default shall have occurred and be
<br />continuing in which case the net proceeds shall be paid to Lessor to the extent of, and applied to the amount due and payable to
<br />Lessor under this Agreement. Any net proceeds remaining after application of net proceeds in accordance with the preceding
<br />sentence shall be paid to, and belong to, Lessee. If the net proceeds of any insurance recovery are insufficient to pay in full for the
<br />repair, restoration or replacement of the Equipment, Lessee shall either complete the work to the satisfaction of Lessor, and pay any
<br />costs in excess of the net proceeds without any claim for reimbursement or credit from Lessor or pay the then applicable purchase
<br />price for the Equipment (as determined by Lessor according to its usual and customary manner) plus all Payments then due and
<br />owing hereunder. "Net proceeds" shall mean the amount remaining from the gross proceeds of any insurance claim or
<br />condemnation award after deducting all expenses (including reasonable attorneys' fees) incurred in the collection of such claim or
<br />award.
<br />9. INSURANCE. Lessee agrees to keep the Equipment insured to protect all interests of Lessor, at Lessee's expense, for such
<br />risks, in such amounts, in such forms and with such companies as Lessor may require, including but not limited to fire and extended
<br />coverage insurance, explosion and collision coverage, and personal liability and property damage liability insurance. Lessor may
<br />(but shall not be obligated to) insure the Equipment at the expense of Lessee. Any insurance policies relating to loss or damage to
<br />the Equipment will name Lessor as loss payee as its interests may appear and the proceeds may be applied toward the
<br />replacement or repair of the Equipment or the satisfaction of the Payments due hereunder. Any such policies shall contain a
<br />provision that they may not be cancelled or the coverage reduced without thirty (30) days prior written notice to Lessor. Any liability
<br />insurance policies will name Lessee and Lessor as co- insured and the proceeds shall be applied first to Lessor to the extent of its
<br />liability, if any, and the balance to Lessee. Lessee shall furnish certificates, policies or endorsements to Lessor as proof of such
<br />insurance. Lessee hereby appoints Lessor as Lessee's attomey -in -fact to make claim for, receive payment of and execute or
<br />endorse all documents, checks or drafts for loss or damage or return premiums under any insurance policy issued on the Equipment
<br />and hereby assigns to Lessor all of its right, title and interest in and to such insurance policies and the proceeds thereof. If Lessee
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