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used in any activity carried on by any person other than a state or local governmental unit or payments in
<br />respect of such property; or (ii) on a present value basis, derived from payments (whether or not to Lessee)
<br />in respect of property, or borrowed money, used or to be used in any activity carried on by any person other
<br />than a state or local governmental unit. The Equipment will not be used, directly or indirectly, in any
<br />activity carried on by any person other than a state or local government unit. No portion of the purchase
<br />price for the Equipment will be used, directly or indirectly, to make or finance loans to any person other
<br />than Lessee. Lessee has not entered into any management or other service contract with respect to the use
<br />and operation of the Equipment as previously described.
<br />(g) The entering into and performance of this Lease Agreement and the Escrow Agreement
<br />will not violate any judgment, order, law or regulation applicable to Lessee or result in any breach of, or
<br />constitute a default under, or result in the creation of any lien, charge, security interest, or other
<br />encumbrance upon any assets of Lessee or on the Equipment pursuant to an indenture, mortgage, deed of
<br />trust, bank loan or credit agreement, or other instrument to which Lessee is a party or by which it or its
<br />assets may be bound, except as herein provided.
<br />(h) Lessee's name as indicated on the first page of this Lease Agreement is its true, correct,
<br />and complete legal name.
<br />(i) The useful life of the Equipment will not be less than the Lease Term hereof.
<br />a) Lessee has entered into this Lease Agreement for the purpose of purchasing, acquiring, and
<br />leasing the Equipment and not for the purpose of refinancing any outstanding obligation of Lessee more
<br />than 90 days in advance of its payment or prepayment date. The purchase price for the Equipment has been
<br />or will be paid directly by Lessor from the Escrow Fund to the Contractor (or to the Lessee or County as a
<br />reimbursement as applicable), and no portion of the purchase price for the Equipment has been or will be
<br />paid to Lessee as reimbursement for any expenditure paid by Lessee more than 60 days prior to the
<br />execution and delivery hereof, unless a proper reimbursement resolution has been passed and the Lessee
<br />has complied with all reimbursement requirements under the Code, including, without limitation, Treasury
<br />Reg. 1:150.
<br />(k) The application, statements, and credit or financial information submitted by it to Lessor
<br />are true and correct and made to induce Lessor to enter into this Lease Agreement and the Escrow
<br />Agreement.
<br />(1) During the term of this Lease Agreement, Lessee shall (i) provide Lessor, at or prior to the
<br />end of each Fiscal Year (commencing with the current Fiscal Year), with current budgets or other proof of
<br />appropriation for the ensuing Fiscal Year and such other information relating to Lessee's ability to continue
<br />the Lease Term for the next succeeding Fiscal Year as may be reasonably requested by Lessor and
<br />(ii) furnish or cause to be furnished to Lessor, at Lessee's expense, as soon as available and in any event
<br />not later than 180 days after the close of each Fiscal Year, the audited financial statements of Lessee at the
<br />close of and for such Fiscal Year, all in reasonable detail, audited by and with the report of Lessee's auditor.
<br />(in) On the Commencement Date, ,Lessee shall cause to be executed and delivered to Lessor an
<br />Opinion of Lessee's Counsel in substantially the form attached as Exhibit F hereto.
<br />(n) Lessee shall pay the excess (if any) of the actual costs of acquiring the Equipment
<br />hereunder over the amount deposited by Lessor in the Escrow Fund and interest earnings thereon.
<br />(o) Lessee has experienced no material change in its financial condition since June 30, 2016.
<br />(p) Lessee acktiowledges that: (a) Lessor is acting solely for its own account and not as a
<br />fiduciary for Lessee or in the capacity of broker, dealer, municipal securities underwriter or municipal
<br />advisor; (b) Lessor has not provided, and will not provide, financial, legal, tax, accounting or other advice
<br />to or on behalf of Lessee with respect to its acquisition of the Equipment; and (c) Lessee has sought and
<br />obtained financial, legal, tax, accounting and other advice (including as it relates to structure, timing, terms
<br />City of Santa Ana/ Holmen Capital Corporation Page 9 of 11
<br />Equipment Lease -Purchase Agreement June 15, 2017
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