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Agreement. If at any time, or from time to time, the Licensed Equipment is not adequate for CONTRACTOR to meet such obligations, or, the Solid Waste collection and Recycling vehicles licensed pursuant to this section need to be replaced for any reason, including loss, CONTRACTOR shall be responsible for providing any and all additional or replacement Solid Waste collection and Recycling vehicles and any and all additional Solid Waste collection and Recycling carts as may be necessary for the collection, Recycling and disposal of all Solid Waste for which it is responsible under this Agreement. (b) FINANCING: The Licensed Equipment being provided to CONTRACTOR pursuant to section (a) hereunder is being acquired pursuant to that certain "Installment Purchase Contract" ("IPC") between the CITY and the California Environmental Finance Corporation ("CEFC") dated June 1, 1996, a copy of which is on file with the Clerk of the Council and which is incorporated herein by this reference. CONTRACTOR hereby acknowledges the flow of funds and priority of revenues set forth in Section 3.06 of the IPC, which is further summarized on pages 12 and 13 of the Official Statement accompanying the issuance of the tax exempt Certificates of Participation ("C.O.P.s") which have been, or will be, issued by CEFC to raise the funds necessary for it to purchase the Licensed Equipment. While not required to do so, CEFC has agreed to acquire the Licensed Equipment in accordance with the competitive bidding procedures set forth in Section 421 of the CITY'S municipal charter. The CITY agrees to take all necessary action and execute all necessary documents to facilitate the issuance of the C.O.P.s and to approve an excess proceeds certificate authorizing an excess proceeds prepayment of the C.O.P.s as provided in Sections 3.11 and 4.01(b) of that certain "Trust Agreement" by and among the CITY, CEFC and Harris Trust Company of California, a copy of which is on file with the Clerk of the Council and which is incorporated herein by this reference. (c) MAINTENANCE OF LICENSED EQUIPMENT: CONTRACTOR shall, at its own expense, maintain and preserve the Licensed Equipment in good repair and working order at all times and will operate the Licensed Equipment in an efficient and economical manner and will pay all maintenance and operation costs of the Licensed Equipment as they become due and payable. On or before the first day of each fiscal year, CONTRACTOR will prepare a budget setting forth the estimated maintenance and operation costs of the Licensed Equipment for such fiscal year. (d) OPERATION OF LICENSED EQUIPMENT: CONTRACTOR shall be fully responsible to the CITY for the storage, operation, maintenance and management of the Licensed Equipment. CONTRACTOR shall distribute the Solid Waste collection and Recycling carts (one for Recyclable Solid Waste, one for Yard Waste and one for non-Recyclable Solid Waste) to each Curbside Service Unit throughout the CITY. CONTRACTOR will utilize the Licensed Equipment solely to collect, recycle and/or dispose of Solid Waste generated within the CITY for which it is responsible pursuant to this Agreement. (e) FUEL FOR LICENSED EQUIPMENT: All fuel required for the operation of the Licensed Equipment pursuant to this Agreement shall be purchased by the CONTRACTOR. CONTRACTOR shall be responsible for the costs of such fuel and all costs associated therewith. (f) OPTION TO PURCHASE: At such time as the C.O.P.s used to finance the Licensed Equipment are paid in full or otherwise satisfied or demised, the CONTRACTOR shall have a ninety 10 25A-18