Res 2013-026/Lease purchase agreement for a 544K Loader and a Pneumatic Roller for Streets Division

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Addendum #1 to Master Lease Purchase Agreement Dated as of March 5, 2013, between Sovereign Bank, N.A. (Lessor) and City of San Marcos (Lessee) The Lessee and the Lessor agree to the following changes to Master Lease Purchase Agreement. Substitute Section 4.01 Non - Appropriations with the following: Section 4.01. Non - Appropriation. Funds for payment of this Agreement have been provided through the City budget approved by City Council for the current fiscal year only. State statutes prohibit the obligation and expenditure of public funds beyond the fiscal year for which a budget has been approved. However, the cost of items or services covered by this Agreement is considered a recurring requirement and is included as a standard and routine expense of the City to be included in each proposed budget within the foreseeable future. City Council expects this to be an integral part of future budgets to be approved during the period of this Agreement except for unanticipated needs or events which may prevent such payments against this Agreement. However, the City cannot guarantee the availability of funds, and enters into this Agreement only to the extent such funds are made available. The fiscal year for the City extends from October 1 st of each calendar year to September 30th of the following calendar year. If Lessee chooses this option, then all obligations of the Lessee under such Lease regarding Rental Payments for all remaining Renewal Terms shall be terminated at the end of the then current Original Term or Renewal Term without penalty or liability to the Lessee of any kind provided that if Lessee has not delivered possession of the Equipment subject to such Lease to Lessor as provided herein and conveyed to Lessor or released its interest in such Equipment by the end of the last Budget Year for which Rental Payments were paid, the termination shall nevertheless be effective but Lessee shall be responsible for the payment of damages in an amount equal to the amount of the Rental Payments thereafter coming due under Exhibit "B" to the Schedule for such Lease which are attributable to the number of days after such Budget Year during which Lessee fails to take such actions and for any other loss suffered by Lessor as a result of Lessee's failure to take such actions as required. Lessee shall immediately notify the Lessor as soon as the decision to non - appropriate is made. If such non - appropriation occurs, then Lessee shall deliver the Equipment to Lessor or to a location designated by Lessor at Lessee's expense. Lessee shall be liable for all damage to the Equipment other than normal wear and tear. If Lessee fails to deliver such Equipment to Lessor, then Lessor may enter the premises where such Equipment is located and take possession of the Equipment and charge Lessee for costs incurred. In Section V. Insurance, Damage, Insufficiency of Proceeds, Indemnification Section 5.01. Insurance: Delete "and an additional insured" in the third sentence. Insert the following: (e) All insurance proceeds will be designated directly to Lessor. Lessor and Lessee have caused this Addendum to be executed in their names by their duly authorized representatives listed below. Lessee: City of S n Marcos By: G4 TO Name: Steve Parker Title: Assistant City Manager .3 Date: ; �� Lessor: Sovereign Bank, N.A. By: Name: Title: Date: i�