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<br /> 7. REPRESENTATIONS, COVENANTS AND WARRANTIES. Lessee represents, covenants and warrants as of the date hereof and at
<br /> all times during the Lease Term that (i) Lessee is a state or a fully constituted political subdivision thereof, or its obligations hereunder
<br /> constitute obligations issued on behalf of a state or a political subdivision thereof, such that any interest derived under this Lease will qualify
<br /> forexemption from Federal income taxes under section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), and that it will do or cause
<br /> to be done all things necessary to preserve and keep in full force and effect (a) its existence and (b) this Lease; (ii) the execution, delivery and
<br /> performance by the Lessee of this Lease and all documents executed in connection herewith, including, without limitation, Schedule A hereto and the
<br /> Delivery and Acceptance Certificate referred to in Section 3 hereof (the Lease together with all such documents shall be collectively referred to herein as
<br /> the "Lease Documents") have been duly authorized by all necessary action on the. part of the Lessee; (iii) the Lease Documents each constitute a legal,
<br /> valid and binding obligation of the Lessee enforceable in accordance with their respective terms; (iv) no additional governmental orders, permissions,
<br /> consents, approvals or authorizations are required to be obtained and no registrations or declarations are required to be filed' in connection with the
<br /> execution and delivery of the Lease Documents; (v) Lessee has sufficient appropriations or other funds available to pay all Lease Payments and other
<br /> amounts due hereunder for the current fiscal period; (vi) the use of the Equipment by the Lessee is essential to and will be limited to the performance by
<br /> Lessee of one or more governmental functions of Lessee consistent with the permissible scope of Lessee's authority; (vii) no portion of the. Equipment
<br /> will be used directly or indirectly in any trade or business carried on by any person other than Lessee; and (viii) no portion of the Equipment will be used
<br /> by an organization described in section 501 (c) (3) of the Code and (ix) this Lease does not constitute an arbitrage. obligation within the me; . ~ of
<br /> section 148 of the Code and is not federally guaranteed within the meaning of section 149(b) of the Code.
<br /> Lessee shall deliver to Lessor an opinion of Lessee's counsel in form and substance as set forth herein or as otherwise acceptable to Lessor the
<br /> event that a question arises as to Lessee's qualification as a political subdivision, Lessee agrees to execute a power of attorney authorizing Ll.-.Jr to
<br /> make application to the Internal Revenue Service for a letter ruling with respect to the issue;
<br /> 8. TITLE TO EQUIPMENT. Upon acceptance of the Equipment by Lessee hereunder, title to the Equipment will vest in Lessee subject to Lessor's
<br /> rights under this Lease; provided, however, that (i) in the event of termination of this Lease pursuant to Section 6 hereof, (ii) upon the occurrence of an
<br /> Event of Default hereunder, and as long as such Event of Default is continuing, or. (iii) in the event that the purchase option has not been exercised prior
<br /> to the Expiration Date, title will immediately vest in Lessor or its assignee without any action by Lessee and Lessee shall immediately surrender
<br /> possession of the Equipment to Lessor or its assignee in the manner set forth in Section 5 hereof.
<br /> 9. USE; REPAIRS. Lessee will use the Equipment in a careful manner for the use contemplated by the manufacturer of the Equipment. Lessee shall
<br /> comply with all laws, ordinances, insurance policies and regulations relating to the possession, use, operation or maintenance of the Equipment.
<br /> Lessee, at its expense, will keep the Equipment in good working order and repair and furnish all parts, mechanisms and devices required therefor.
<br /> 10. ALTERATIONS. Lessee will not make any alterations, additions or improvements to the Equipment without Lessor's prior written consent unless
<br /> such alterations, additions or improvements may be readily removed without damage to the Equipment.
<br /> 11. LOCATION; INSPECTION. The Equipment will not be removed from. or, if the Equipment consists of rolling stock, its permanent base will not be
<br /> changed from the Equipment Location without lessor's prior written consent which will not be unreasonably withheld, Lessor will be entitled to enter
<br /> upon the Equipment Location or elsewhere during reasonable business hours to inspect the Equipment or observe its use and operation.
<br /> 12. LIENS AND TAXES. Lessee shall keep the Equipment free and. clear of all levies, liens and encumbrances except those created under this
<br /> Lease. Lessee shall pay, when due, aD: charges and taxes (local. state and federal) which may now or hereafter be imposed upon the ownership,
<br /> leasing, rental, sale, purchase, possession or use of the Equipment, excluding however, all taxes on or measured by Lessor's income. If Lessee fails to
<br /> pay said charges, or taxes when due, Lessor may, but need not, pay said charges or taxes and, in such event, Lessee shall reimburse Lessor therefor
<br /> on demand, with interest at the maximum rate permitted by law from the date of such payment by Lessor to the date of reimbursement by Lessee.
<br /> 13. RISK OF LOSS; DAMAGE; DESTRUCTION. Lessee assumes all risk of loss of or damage to the Equipment from any cause whatsoever, and
<br /> no such loss of or damage to the Equipment nor defect therein nor unfitness or obsolescence thereof shall relieve Lessee of the obligation to make
<br /> Lease Payments or to perform any other obligation under this Lease. In the event of damage to any item of Equipment, Lessee will immediately place
<br /> the same in good repair with the proceeds of any insurance recovery applied to the cost of such repair. If Lessor determines that any item of EI nent
<br /> is lost, stolen, destroyed or damaged beyond repair, Lessee, at the option of Lessor, will either (a) replace the same with like equipment. in goc pair,
<br /> or (b) on the next. Lease Payment. Date, pay Lessor: (il all amounts then owed by lessee to Lessor under this Lease, including the lease Payr due
<br /> on such date, and (ii) an amount equal to the applicable. Concluding. Payment set forth in Schedule A opposite such Lease Payment Date. In t. "" .went
<br /> that Lessee is obligated to make such payment. pursuant to. subparagraph (b) above with respect to less than all of the Equipment, Lessor will provide
<br /> Lessee with the pro rata amount of the Lease Payment. and the Concluding Payment to be made by Lessee with respect to the Equipment which as
<br /> suffered the event of loss.
<br /> 14. PERSONAL PROPERTY. The Equipment is and will remain personal property and will not be deemed to be affixed or attached to real estate or
<br /> any building thereon. If requested by Lessor, Lessee will, at Lessee's expense, furnish a waiver of any interest in the Equipment. from any party having
<br /> an interest in any such real estate or building.
<br /> 15. INSURANCE. Lessee, will, at its expense, maintain at all: times during the Lease T arm, fire and extended coverage, public liability and property
<br /> damage insurance with respect to the Equipment in such amounts, covering. such risks, and with such insurers as shall be satisfactory to Lessor, or,
<br /> with Lessor's prior written consent, may selfo.insure against any or all such risks. In no event Wll the insurance limits be less than the amount of the
<br /> then applicable Concluding Payment with respect to such Equipment Each insurance policy will name. Lessee as an insured and Lessor or its assigns
<br /> as an additional insured, and will con1ain a clause requiring the insurer to give Lessor or its assigns at. least thirty (30) days. prior written notice of any
<br /> alteration in the terms of such policy or the cancellation thereof. Ther proceeds of any such policies will be. payable to Lessee and Lessor or its assigns
<br /> as their interests may appear. Upon acceptance of the Equipment. and. upon each insurance renewal date, Lessee will deliver to Lessor a certificate
<br /> evidencing such insurance. In the event that Lessee has been permitted to self-insure. Lessee will furnish Lessor with a letter or certificate to such
<br /> effect In the event of any loss, damage, injury or accident involving the Equipment, Lessee will promptly provide Lessor with written notice thereof and
<br /> make available to lessor all information and documentation relating. thereto and. shall permit Lessor to participate and cooperate with Lessee in making
<br /> any claim for insurance in respect thereof.
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