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consents to the assignment of the Lessee's interest in the Equipment to the County of Orange (the
<br />"County" or "Designated Assignee "). Lessor expressly acknowledges that the Designated Assignee shall
<br />own and operate the Equipment for the collectively beneficial use of participating agencies, including the
<br />Lessee as set forth in the Joint Agreement for Operation, Maintenance, and Financial Management of the
<br />800 MHz Countywide Coordinated Communication System dated November 2004 and all amendments
<br />thereto between the County and participating agencies (the "Management Agreement'). Lessor
<br />acknowledges that Lessee is solely responsible for the payment of its pro -rata share of the System for use
<br />of the Management Agreement.
<br />7. Use of Equipment; Maintenance and Repairs. Lessee shall keep the Equipment within the
<br />State at the "Equipment hocation" stated fit Exhibit A and Lessee shall not remove any of the Equipment
<br />therefrom (except as within the Equipment's normal and contemplated use) without Lessor's prior written
<br />notice. Lessee, or the Designated Assignee, shall use the Equipment in a careful manner and shall at all
<br />times, pursuant to the terms of the Management Agreement with the County of Orange and member
<br />agencies, keep the Equipment in good operating condition, repair and appearance and comply with all
<br />laws, ordinances, regulations or requirements of any governmental authority, official, board or department
<br />relating to its installation, possession, use or maintenance. Lessee, or the Designated Assignee, shall not
<br />make any alterations, additions, or improvements to the Equipment that are not readily removable without
<br />causing damage to or reducing the value of the Equipment. All alterations, additions, or improvements not
<br />readily removable shall become property of Lessor. Notwithstanding the foregoing, Lessor acknowledges
<br />and agrees that the Equipment is the Lessee's pro rata share or portion of a county -wide System (as
<br />defined in Exhibit A) upgrade. As such, the parties understand and agree that Lessee's obligations to
<br />repair, upgrade, and make any modifications or alterations to the Equipment shall: (1) be solely with
<br />respect to the Equipment (i.e. its pro rata Cost Share (as defined in Exhibit A) thereof) , and (2) not be
<br />required to the extent that either the entire county -wide system is not modified, or such modifications may
<br />interfere with the rights of other participants in the System.
<br />8. Security Interest; Title to Equipment. To secure the performance of all of Lessee's
<br />obligations hereunder, Lessee hereby grants to Lessor, and Lessor shall have and retain, a security interest
<br />on the beneficial use of the Equipment delivered hereunder and on any attachments, proceeds therefrom.
<br />Lessee agrees to execute and deliver such additional documents, including, without limitation, opinions of
<br />counsel, financing statements, notices and similar instruments, in form satisfactory to Lessor, that Lessor
<br />deems necessary or appropriate to establish and maintain its security interest in the Equipment or for the
<br />confirmation of Lessor's rights hereunder. As further security therefor, Lessee hereby grants to Lessor a
<br />first priority security interest in the cash and negotiable instruments from time to time in the Escrow Fund
<br />and all proceeds (cash and non -cash) thereof, and agrees with respect thereto that Lessor shall have all the
<br />rights and remedies of a secured party under the applicable Uniform Commercial Code. Lessee, at its
<br />expense, will protect acid defend Lessee's rights in the Equipment and Lessor's rights and interests therein
<br />and will keep the Equipment free and clear from any and all claims, liens, encumbrances and legal
<br />processes of Lessee's creditors and other persons; provided, however, that Lessee shall not be responsible
<br />for liens or encumbrances permitted by other participants or users of the System, Lessor shall have the
<br />right during normal hours, upon reasonable prior notice to Lessee, to enter upon any premises owned by
<br />the Lessee and where the Equipment is located in order to inspect the Equipment.
<br />(b) Solely with respect to Equipment that is not comprised of vehicles and during the Lease Term,
<br />ownership aril legal title of all of the Equipment and all substitutions, repairs, modifications, and
<br />replacements shall be in the Designated Assignee, and Lessee shall request the Designated Assignee to
<br />take all necessary action to vest such ownership and title in Lessee. Lessor does not own the Equipment,
<br />and, by this Lease Agreement, Lessor is merely financing the acquisition of the Equipment for the Lessee.
<br />Lessor has not been in the chain of title, does not operate, control or have possession or control over the
<br />Equipment, or Lessee's, or the Designated Assignee's use, maintenance, operation, storage, or
<br />City ul'Sanla Ana; Holman Capital Corporation
<br />Equipnxnl Lease - Purchase Agreement
<br />WCSR 339735920
<br />55A -12
<br />Page 3 nP 1i
<br />May h, 2a I5
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