MC REF COPS 2015 - LEASE-PURCHASE AGREEMENT_380698343_4.DOC

SQUIRE DRAFT
03/24/15
When recorded return to:
Timothy E. Pickrell, Esq. Affidavit and Fee Exemption Claimed:
Squire Patton Boggs (US) LLP A.R.S. Section 11-1134.A.2
1 E. Washington St., Suite 2700
Phoenix, Arizona 85004 Property Tax Exemption:
A.R.S. Section 42-11102.A.2
LEASE-PURCHASE AGREEMENT
Dated as of ____________, 2015
between
_______________________,
in its capacity as Trustee under the Trust Agreement,
as Lessor
and
MARICOPA COUNTY, ARIZONA,
as Lessee
relating to
$__________
Maricopa County, Arizona
Certificates of Participation, Series 2015
Squire Patton Boggs (US) LLP
Bond Counsel
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS; EXHIBITS
Section 1.1. Definitions............................................................................................................1
Section 1.2. Exhibits.................................................................................................................5
Section 1.3. Execution and Delivery of 2015 Certificates .......................................................5
ARTICLE II
REPRESENTATIONS, COVENANTS AND WARRANTIES
Section 2.1. Representations, Covenants and Warranties of the Lessee..................................5
Section 2.2. Representations, Covenants and Warranties of the Lessor ..................................8
Section 2.3. Tax Covenants......................................................................................................9
ARTICLE III
DEPOSIT OF MONEYS; APPLICATION OF FUNDS
Section 3.1. Deposit of Moneys .............................................................................................10
Section 3.2. Acquisition of Leased Property..........................................................................10
Section 3.3. Payment of Delivery Costs.................................................................................10
Section 3.4. Unexpended Proceeds and Other Moneys .........................................................10
ARTICLE IV
AGREEMENT TO LEASE-PURCHASE; TERMINATION OF THIS AGREEMENT; LEASE
PAYMENTS; TITLE TO THE LEASED PROPERTY
Section 4.1. Lease-Purchase...................................................................................................10
Section 4.2. Term of Agreement; Termination ......................................................................10
Section 4.3. Possession...........................................................................................................11
Section 4.4. Lease Payments; Additional Rent; Other Payments ..........................................11
Section 4.5. Quiet Enjoyment ................................................................................................13
Section 4.6. Title ....................................................................................................................13
Section 4.7. Additional Rent ..................................................................................................14
ARTICLE V
MAINTENANCE; TAXES; INSURANCE; AND OTHER MATTERS
Section 5.1. Maintenance, Utilities, Taxes and Assessments.................................................14
Section 5.2. Modification of Leased Property........................................................................15
Section 5.3. General Liability Insurance................................................................................15
Section 5.4. Casualty and Property Coverage Insurance .......................................................16
Section 5.5. Title Insurance....................................................................................................16
Section 5.6. Insurance Net Proceeds; Form of Policies .........................................................16
Section 5.7. Advances ............................................................................................................17
Section 5.8. Installation of Lessee’s Equipment ....................................................................17
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TABLE OF CONTENTS
(continued)
Page
Section 5.9. Liens...................................................................................................................17
Section 5.10. Delivery of Leased Property Upon Termination................................................17
ARTICLE VI
DAMAGE, DESTRUCTION AND EMINENT DOMAIN; USE OF NET PROCEEDS
Section 6.1. Damage, Destruction and Condemnation...........................................................17
Section 6.2. Obligation to Repair and Replace the Leased Property .....................................18
Section 6.3. Reduction of Rental in the Event of Prepayment of Lease Payments................19
Section 6.4. Cooperation of the Trustee.................................................................................19
ARTICLE VII
ACCESS TO LEASED PROPERTY, INDEMNIFICATION
Section 7.1. Access to the Leased Property ...........................................................................19
Section 7.2. Release and Indemnification Covenants ............................................................19
ARTICLE VIII
ASSIGNMENT, SUBLEASING AND AMENDMENT
Section 8.1. Assignment and Subleasing by the Lessee.........................................................20
Section 8.2. Amendment of this Lease...................................................................................20
Section 8.3. Release of Leased Property................................................................................20
ARTICLE IX
EVENTS OF LEASE DEFAULT AND REMEDIES
Section 9.1. Events of Lease Default Defined .......................................................................21
Section 9.2. Remedies ............................................................................................................22
Section 9.3. No Remedy Exclusive........................................................................................23
Section 9.4. Agreement to Pay Attorneys’ Fees and Expenses..............................................23
Section 9.5. No Additional Waiver Implied by One Waiver .................................................23
Section 9.6. Application of Proceeds .....................................................................................23
Section 9.7. Trustee and Certificate Owners to Exercise Rights ...........................................24
ARTICLE X
PREPAYMENT OF LEASE PAYMENTS
Section 10.1. Security Deposit .................................................................................................24
Section 10.2. Purchase Option .................................................................................................24
Section 10.3. Optional Prepayment..........................................................................................24
Section 10.4. Mandatory Prepayment From Net Proceeds of Insurance, Eminent
Domain...............................................................................................................25
Section 10.5. Credit for Amounts on Deposit ..........................................................................25
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TABLE OF CONTENTS
(continued)
Page
ARTICLE XI
MISCELLANEOUS
Section 11.1. Notices................................................................................................................25
Section 11.2. Binding Effect ....................................................................................................26
Section 11.3. Severability.........................................................................................................26
Section 11.4. Net-net-net Lease ...............................................................................................26
Section 11.5. Further Assurances and Corrective Instruments ................................................26
Section 11.6. Execution in Counterparts..................................................................................26
Section 11.7. Applicable Law ..................................................................................................26
Section 11.8. Lessor and Lessee Representatives ....................................................................26
Section 11.9. Captions..............................................................................................................26
Section 11.10. Cancellation of Contracts...................................................................................26
EXHIBIT A – DESCRIPTION OF LEASED PROPERTY
EXHIBIT B – PERMITTED ENCUMBRANCES
EXHIBIT C – SCHEDULE OF LEASE PAYMENTS
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LEASE-PURCHASE AGREEMENT
THIS LEASE-PURCHASE AGREEMENT (this “Lease”), is dated as of ___________,
2015, between ___________________________, in its capacity as trustee under the Trust
Agreement (as defined herein), as lessor (together with its successors in that capacity, the
“Lessor” or the “Trustee”), and MARICOPA COUNTY, ARIZONA, as lessee (the “Lessee” or
the “County”);
WITNESSETH:
WHEREAS, pursuant to a Ground Lease (as defined herein), the County has leased to the
Trustee the South Court Tower located in the City of Phoenix, Maricopa County, Arizona, as
more fully described in Exhibit A hereto (the “Leased Property”); and
WHEREAS, in connection with the execution of this Lease, the County and the Trustee
are executing a Trust Agreement (the “Trust Agreement”), pursuant to which the Trustee is
executing and delivering Certificates of Participation (the “Certificates”) evidencing
proportionate ownership interests in the lease payments to be made by the County pursuant to
this Lease, and in all other rights of the Owners of Certificates under this Lease, the Ground
Lease and the Trust Agreement and the Trustee will cause the proceeds of the sale of the
Certificates to be applied as provided in the Trust Agreement; and
WHEREAS, in order to pay or to reimburse costs of the acquisition, construction,
improvement and equipping of various County sites, buildings and facilities and for other capital
purposes, the Trustee is willing to execute and deliver Certificates in a principal amount of
$_______ to be denominated “Certificates of Participation, Series 2015” (the “2015
Certificates”); and
WHEREAS, the County deems it prudent and advisable to authorize the execution and
delivery of the 2015 Certificates in a principal amount of $____________;
ARTICLE I
DEFINITIONS; EXHIBITS
Section 1.1. Definitions. For purposes of this Lease, the following definitions apply.
Capitalized terms not defined in this Lease but defined in the Trust Agreement are used as
defined in the Trust Agreement.
“Additional Rent” means any payments required to be made pursuant to Section 4.7 in
addition to the Lease Payments.
“Acquisition Fund” means the fund by that name established and held by the Trustee
pursuant to Section 3.1 of the Trust Agreement.
“Board” means the Board of Supervisors of the County.
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“Bond Counsel” means a nationally recognized bond counsel firm whose opinion is given
with respect to the Certificates when issued, or its successors, or other nationally recognized
bond counsel appointed by the County.
“Business Day” means a day of the year other than (a) a Saturday or Sunday or (b) a day
on which the Federal Reserve System is closed.
“Certificates” means, collectively, the 2015 Certificates and any Additional Certificates
executed and delivered under the Trust Agreement.
“Closing Date” means (a) with respect to the 2015 Certificates, the day when the 2015
Certificates, duly executed by the Trustee, are delivered to the Original Purchaser, and (b) with
respect to any other series of Certificates, the day when the Certificates of such series, duly
executed by the Trustee, are delivered to the initial purchasers.
“Code” means the Internal Revenue Code of 1986, as amended and supplemented from
time to time, and any applicable regulations.
“Corporation” means the Maricopa County Public Finance Corporation.
“County” means Maricopa County, Arizona.
“Defeasance Obligations” means (i) cash (insured at all times by the Federal Deposit
Insurance Corporation or otherwise collateralized with obligations described in the following
clause) and (ii) obligations of, or obligations guaranteed as to principal and interest by, the
United Stated of America or any agency or instrumentality thereof, when such obligations are
backed by the full faith and credit of the United States of America, including (A) United States
Treasury obligations, including State and Local Government Series, and (B) all direct or fully
guaranteed obligations of the Farmers Home Administration, General Services Administration,
Guaranteed title XI financing, and Government National Mortgage Association (GNMA). Any
security used for defeasance must provide for the timely payment of principal and interest and
cannot be callable or prepayable prior to maturity or earlier redemption of the rated debt
(excluding securities that do not have a fixed par value and/or whose terms do not promise a
fixed dollar amount at maturity or call date).
“Delivery Costs” means all items of expense directly or indirectly payable by or
reimbursable to the Lessee or the Lessor relating to the execution, sale and delivery of this Lease,
the Ground Lease, the Trust Agreement or the Certificates, including but not limited to filing and
recording costs, settlement costs, printing costs, reproduction and binding costs, initial fees and
charges of the Trustee and the Lessor, legal fees and charges, accountants’ verification fees,
insurance fees and charges, costs of any title insurance policy, financial and other professional
consultant fees, costs of rating agencies for credit ratings, fees for execution, transportation and
safekeeping of the Certificates and any other costs, expenses, fees and charges in connection
with the foregoing.
“Delivery Costs Fund” means the fund by that name established and held by the Trustee
pursuant to Section 3.2 of the Trust Agreement.
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“Event of Lease Default” means an Event of Lease Default described in Section 9.1.
“Event of Non-appropriation” means the termination of this Lease for failure of the
County to obtain proper budgeting and final appropriation of funds necessary to make all Lease
Payments coming due during a Fiscal Period, as provided in Section 4.2(b). An Event of Non-
appropriation may also occur under circumstances described in Section 6.3.
“Fiscal Period” means a period of 12 consecutive months commencing on the first day of
July and ending on the last day of June, or any other consecutive 12-month period which may be
established as the fiscal year of the Lessee for budgeting and appropriation purposes.
“Ground Lease” means the Ground Lease, dated as of _______, 2015, between the
County and the Trustee, as lessee.
“Independent Counsel” means an attorney duly admitted to the practice of law before the
highest court of the state in which such attorney maintains an office and who is not an employee
of the Lessor or the Lessee.
“Insurance and Condemnation Fund” means the fund by that name established and held
by the Trustee pursuant to Article VII of the Trust Agreement.
“Lease” means this Lease-Purchase Agreement, together with any amendments or
supplements.
“Lease Payment” means all payments required to be paid by the Lessee on any date
pursuant to Section 4.4(a) of this Lease and as set forth in Exhibit C hereto.
“Lease Payment Date” means each date on which a Lease Payment is due from the
Lessee as set forth in Exhibit C hereto or the next succeeding Business Day if that date is not a
Business Day.
“Lease Payment Fund” means the fund by that name established and held by the Trustee
pursuant to Article V of the Trust Agreement.
“Leased Property” means the real property described in Exhibit A.
“Lessee” means Maricopa County, Arizona.
“Lessee Representative” shall mean Chairman, Vice Chairman or Acting Chairman of the
Board, the County Administrator of the County or the Director of Finance of the County or the
designees or any of them, or any other person authorized by resolution of the Lessee to act on
behalf of the Lessee under or with respect to the Ground Lease, this Lease and the Trust
Agreement.
“Lessor” means _______________________, as trustee under the Trust Agreement, and
its successors or assigns under the Trust Agreement and this Lease.
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“Lessor Representative” means any person authorized to act on behalf of the Lessor
under or with respect to the Ground Lease, the Trust Agreement or this Lease as evidenced by a
resolution or by-law provision conferring such authorization.
“Net Proceeds” means any insurance proceeds (other than proceeds of any insurance
policy maintained pursuant to Section 5.3 hereof) or condemnation award in excess of $100,000,
paid with respect to the Leased Property, or any proceeds resulting from the sale of the Leased
Property pursuant to Section 9.2(b) of this Lease, remaining after payment therefrom of all
expenses incurred in the collection thereof.
“Original Purchaser” means ___________________, as original purchaser of the 2015
Certificates.
“Owner” or “Certificate Owner” or “Owner of a Certificate,” or any similar term, when
used with respect to a Certificate means the person in whose name such Certificate shall be
registered.
“Permitted Encumbrances” means, as of any particular time: (i) liens for general ad
valorem taxes and assessments, if any, not then delinquent, or which the Lessee may, pursuant to
provisions of Article V of this Lease, permit to remain unpaid; (ii) this Lease; (iii) the Trust
Agreement; (iv) the Ground Lease; and (v) the easements, leases, encumbrances, rights of way,
mineral rights, drilling rights and other rights, reservations, covenants, conditions or restrictions
which exist as of the Closing Date, as shown in Exhibit B. The County represents that no item
shown on Exhibit B will materially impair the use of the Leased Property for purposes of this
Lease.
“Prepayment” means any prepayment of Lease Payments or Additional Rent, in whole or
in part, pursuant to Article X of this Lease.
“Prepayment Date” means any date on which the Lessee may exercise its option to
prepay all of the remaining Lease Payments in order to exercise its option to purchase all of the
Leased Property pursuant to Section 10.2 of this Lease.
“Prepayment Price” means the amount of money, including Additional Rent, required to
be paid by the Lessee on any Prepayment Date in order to exercise its option to purchase all of
the Leased Property pursuant to Section 10.2 of this Lease.
“Qualified Self-Insurance” means any program of self-insurance regarding which the
Trustee has received a written evaluation of an independent insurance consultant or actuarial
consultant having a favorable reputation for skill and experience and an opinion of such
consultant that adequate reserves for such program are either maintained with an independent
corporate trustee or otherwise held with appropriate safeguards to insure their availability.
Notwithstanding the foregoing, any self-insurance program maintained by the Lessee in
accordance with Arizona Revised Statutes Sections 11-981, 11-952.01 and 11-952.02 or their
successors, shall be deemed to be Qualified Self-Insurance hereunder.
“Rebate Fund” means the fund created by Section 8.8(b) of the Trust Agreement.
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“State” means the State of Arizona.
“Tax Compliance Certificate” means any agreement or certificate of the Lessee which the
Lessee may execute in order to establish and maintain the exclusion from gross income for
federal income tax purposes of the interest component of the Lease Payments evidenced by the
Certificates.
“Term of this Lease” or “Term” means the time during which this Lease is in effect, as
provided in Section 4.2.
“Trust Agreement” means the Trust Agreement, dated as of the same date as this Lease,
by and between the Trustee and the County, together with any amendments or supplements.
“Trustee” means ______________________________, in its capacity as trustee under the
Trust Agreement, or any successor as Trustee under the Trust Agreement.
“2015 Certificates” means the $_______________ aggregate principal amount of
Certificates of Participation, Series 2015, to be executed and delivered pursuant to the Trust
Agreement.
Section 1.2. Exhibits. The following Exhibits are attached to, and by reference made
a part of, this Lease:
Exhibit A: The description of the real property constituting the Leased Property
Exhibit B: Description of Permitted Encumbrances
Exhibit C: The schedule of Lease Payments to be paid by the Lessee hereunder
showing each Lease Payment Date and the amount of each Lease Payment.
Section 1.3. Execution and Delivery of 2015 Certificates. To accomplish the
refinancing of the acquisition of and improvements to certain property of the County through the
acquisition by the Trustee of the Leased Property, as set forth in Section 3.2 hereof, the parties
agree that the 2015 Certificates shall be executed and delivered by the Trustee in an amount
sufficient to pay all the costs of the acquisition of the Leased Property and Delivery Costs as set
forth in the Trust Agreement.
ARTICLE II
REPRESENTATIONS, COVENANTS AND WARRANTIES
Section 2.1. Representations, Covenants and Warranties of the Lessee. The Lessee
represents, covenants and warrants to the Lessor as follows:
(a) Authorization. The Constitution and the laws of the State authorize the Lessee to
enter into this Lease, the Ground Lease and the Trust Agreement and to enter into the
transactions contemplated by and to carry out its obligations under all of those instruments, and
the Lessee has duly authorized, executed and delivered all of those instruments in accordance
with the laws of the State.
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(b) No Violations. Neither the execution and delivery of this Lease, the Ground
Lease or the Trust Agreement, nor the fulfillment of or compliance with their terms, nor the
consummation of the transactions contemplated hereby or thereby, conflicts with or results in a
breach of the terms, conditions or provisions of any law, regulation, court order, restriction, or
any agreement or instrument to which the Lessee is now a party or by which the Lessee is bound,
or constitutes a default under any of the foregoing, or results in the creation or imposition of any
lien, charge or encumbrances upon any of the property or assets of the Lessee, or upon the
Leased Property, except Permitted Encumbrances.
(c) Execution and Delivery. The Lessee has duly authorized, executed and delivered
this Lease in accordance with the laws of the State and upon such execution and delivery the
Lease will be a valid and binding agreement of the Lessee.
(d) Annual Appropriation. The Lessee will, subject to Section 4.2 hereof, include in
its budget for each successive Fiscal Period during the Term of this Lease a sufficient amount to
permit the Lessee to make all of the Lease Payments, to pay Additional Rents and to make all
other payments under this Lease, and the County has budgeted and has available for the current
Fiscal Period sufficient funds to comply with its obligations under this Lease.
(e) Need for Leased Property. The Lessee has an immediate need for, and expects to
make immediate use of, the Leased Property, which need is not temporary or expected to
diminish in the foreseeable future.
(f) Foreseeable Need. There are no circumstances presently affecting the Lessee that
could be reasonably expected to alter its foreseeable need for the Leased Property or adversely
affect its ability or willingness to budget funds for the payment of Lease Payments, Additional
Rent and other payments due under this Lease.
(g) Governmental Use. The Leased Property will be used by the Lessee during the
Term of this Lease for the purpose of carrying out the governmental purposes of the Lessee.
(h) Compliance With and Enforcement of Lease. The Lessee will perform all
obligations and duties imposed on it under this Lease, the Ground Lease and the Trust
Agreement. The Lessee, immediately upon receiving or giving any notice, communication or
other document in any way relating to or affecting its estates in the Leased Property, will deliver
the same, or a copy, to the Trustee.
(i) Prosecution and Defense of Suits. The Lessee shall promptly, upon written
request of the Lessor or any Certificate Owner, from time to time take such action as may be
necessary or proper to remedy or cure any defect in or cloud upon the title to the Leased
Property, and shall prosecute all such suits, actions and other proceedings as may be appropriate
for that purpose and shall, to the maximum extent permitted by law, indemnify and save the
Lessor, the Trustee and every Certificate Owner harmless for, from and against all loss cost,
damage and expense, including attorneys’ fees, which they or any of them may incur by reason
of any such defect, cloud, suit, action or proceeding.
(j) Recordation and Filing. The Lessee shall record and file this Lease and the
Ground Lease and all such documents as may be required by law (and shall take all further
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actions which may be necessary or be reasonably required by the Trustee), all in such manner, at
such times and in such places as may be required by law in order fully to preserve, protect and
perfect the security of the Trustee and the Certificate Owners.
(k) Further Assurances. The Lessee will make, execute and deliver any and all such
further resolutions, instruments and assurances as may be reasonably necessary or proper to carry
out the intention or to facilitate the performance of the Ground Lease, the Trust Agreement and
this Lease, and for the better assuring and confirming unto the Owners of the Certificates the
rights and benefits provided in those documents.
(l) Environmental Matters.
(i) Except as previously disclosed in writing to the Lessor and the Trustee,
the Lessee has not been informed of, nor does the Lessee have any knowledge of (a) the
presence of any “Hazardous Substances” (as defined below) on any of the Leased
Property, or (b) any spills, releases, threatened releases, discharges or disposal of
Hazardous Substances that have occurred or are presently occurring on or onto any of the
Leased Property or any properties adjacent to any of the Leased Property, or (c) any spills
or disposal of Hazardous Substances that have occurred or are presently occurring on any
other properties as a result of any construction on or operation and use of any such
Leased Property.
(ii) In connection with the construction on or operation and use of any of the
Leased Property, the Lessee represents that it has no knowledge of any failure to comply
with any applicable local, state or federal environmental laws, regulations, ordinances
and administrative and judicial orders relating to the generation, treatment, recycling,
reuse, sale, storage, handling, transport and disposal of any Hazardous Substances.
(iii) The Lessee represents and warrants that it has given no release or waiver
of liability that would impair any claim based upon Hazardous Substances to a previous
owner of any of the Leased Property or to any party who may be potentially responsible
for the presence of Hazardous Substances thereon nor has it made promises of
indemnification regarding Hazardous Substances on or associated with any of the Leased
Property to any person other than the Trustee.
(iv) In the event that the Lessee becomes aware of the release of any
Hazardous Substances on, or other environmental condition, problem or liability with
respect to, any of the Leased Property, the Lessee agrees to promptly notify the Trustee in
writing of such condition. The Lessee further agrees to take actions to investigate and
clean up the release of any Hazardous Substances on, or other environmental condition,
problem or liability affecting, any of the Leased Property, promptly after the Lessee
becomes aware of any such condition and to keep the Trustee advised of all such actions
taken by the Lessee.
(v) As used in this Section, “Hazardous Substances” shall mean: any
substance or material at the level defined or designated as hazardous or toxic waste,
hazardous or toxic material, a hazardous or toxic chemical, a hazardous, toxic or
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radioactive substance, petroleum or other similar term, by any federal, state or local
environmental statute, regulation, or ordinance presently in effect or that may be
promulgated in the future, as such statutes, regulations and ordinances may be amended
from time to time, including, but not limited to, the statutes listed below:
Federal Resource Conservation and Recovery Act
of 1976, 42 U.S.C. Sections 6901, et seq.
Federal Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C.
Sections 9601, et seq.
Federal Emergency Planning and Community
Right-to-Know Act of 19865 42 U.S.C. Sections
11001, et seq.
Federal Clean Air Act, 42 U.S.C. Sections 7401-
7642.
Federal Water Pollution Control Act, Federal Clean
Water Act of 1977, 33 U.S.C. Sections 1251, et seq.
Federal Insecticide, Fungicide, and Rodenticide
Act, 7 U.S.C. Sections 136, et seq.
(m) Disclaimer. The Lessee acknowledges that the Leased Property is being acquired
by the Lessor at the Lessee’s request and direction pursuant to the Ground Lease specifically for
the purpose of leasing the Leased Property to the Lessee; the Leased Property will be acquired on
the basis of specifications and requirements furnished by the Lessee; and the Lessor has not held
itself out as having knowledge or skill particular to the Leased Property or made any affirmations
of fact regarding the Leased Property.
Section 2.2. Representations, Covenants and Warranties of the Lessor. The Lessor
represents, covenants and warrants to the Lessee as follows:
(a) Due Organization and Existence. The Lessor, on the date of execution of this
Lease, is a national banking association, duly organized and existing under the laws of the
United States and has power to enter into this Lease, the Ground Lease and the Trust Agreement,
and has duly authorized the execution and delivery of all of the those documents.
(b) No Encumbrances. The Lessor will not pledge the Lease Payments, Additional
Rent or other amounts derived from the Leased Property and from its other rights under this
Lease, and will not transfer, mortgage or encumber its interest in the Leased Property, except as
provided under the terms of this Lease and the Trust Agreement.
(c) No Violations. Neither the execution and delivery of this Lease, the Ground
Lease or the Trust Agreement, nor the fulfillment of or compliance with the terms and conditions
hereof or thereof, nor the consummation of the transactions contemplated hereby or thereby,
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conflicts with or results in a breach of the terms, conditions or provisions of any restriction or
any agreement or instrument to which the Lessor is now a party or by which the Lessor is bound,
or constitutes a default under any of the foregoing, or results in the creation or imposition of any
lien, charge or encumbrance whatsoever upon any of the property or assets of the Lessor, or upon
the Leased Property, except Permitted Encumbrances.
(d) No Assignments. Except as provided herein, the Lessor will not assign this
Lease, its right to receive Lease Payments, Additional Rent or other amounts derived from the
Leased Property or from its other rights under this Lease or its duties and obligations hereunder
to any other person, firm or corporation.
Section 2.3. Tax Covenants.
(a) The Lessee covenants (i) that it will take or cause to be taken all actions that may
be required of it for the interest on the 2015 Certificates to remain excluded from gross income
for federal income tax purposes, (ii) that it will not take or authorize to be taken any actions
which would adversely affect such exclusion and (iii) that it, or other persons acting for it, will,
among other acts of compliance, (A) apply the proceeds of the 2015 Certificates in compliance
with Arizona law and the Trust Agreement, (B) restrict the yield on investment property, (C)
make or cause to be made timely and adequate payments to the federal government as provided
in Section 8.8 of the Trust Agreement, (D) maintain books and records, and (E) refrain from
certain uses of proceeds and, as applicable, of property financed with such proceeds, all in such
manner and to the extent necessary to assure such exclusion of the interest on the 2015
Certificates under the Code. An officer of the Lessee shall take any and all such actions, make
such rebate payments or potential payments and make or give such reports and certifications as
may be appropriate to assure such exclusion of the interest.
(b) The Lessee covenants that it will use, and will restrict the use and investment of
the proceeds of the 2015 Certificates in such manner and to such extent, if any, as may be
necessary, so that (a) the 2015 Certificates will not (i) constitute an arbitrage bond, a private
activity bond or a hedge bond under Sections 141, 148 or 149 of the Code, or (ii) be treated other
than as bonds to which Section 103(a) of the Code applies, and (b) the interest on the 2015
Certificates will not be treated as a preference item under Section 57 of the Code.
(c) Any officer of the Lessee having responsibility with respect to the execution and
delivery of this Lease shall, alone or in conjunction with any other officer, employee or agent of
or consultant to the Lessee, be authorized (i) to make or affect any election, selection,
designation, choice, consent, approval, or waiver on behalf of the Lessee with respect to this
Lease or the Certificates as the Lessee is permitted or required to make or give under the federal
income tax laws, including, without limitation thereto, any of the elections provided for in
Section 148(f)(4)(C) of the Code or available under Section 148 of the Code, for the purpose of
assuring, enhancing or protecting favorable tax treatment or status of the interest on the 2015
Certificates or assisting compliance with requirements for that purpose, reducing the burden or
expense of such compliance, reducing the rebate amount or payments of penalties, or making
payments of special amounts in lieu of making computations to determine, or paying, excess
earnings as rebate, or obviating those amounts or payments, as determined by that officer, which
action which be in writing and signed by the officer, (ii) to take any and all other actions, make
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or obtain calculations, make payments, and make or give reports, covenants and certifications of
and on behalf of the Lessee, as may be appropriate to assure the exclusion of the interest on the
2015 Certificates from gross income for federal income tax purposes, and (iii) to give one or
more appropriate certificates of the Lessee, for inclusion in the transcript of proceedings for
setting forth the reasonable expectations of the Lessee regarding the amount and use of all the
proceeds relating to the 2015 Certificates and the property financed with such proceeds, the facts,
circumstances and estimates on which they are based, and other facts and circumstances relevant
to the tax treatment of the interest component of payments under the Lease and on the 2015
Certificates.
ARTICLE III
DEPOSIT OF MONEYS; APPLICATION OF FUNDS
Section 3.1. Deposit of Moneys. On the Closing Date, the Lessee will cause the net
proceeds of the sale of the 2015 Certificates to be deposited with the Trustee and the Trustee
shall deposit those net proceeds as provided in Sections 2.6 and 3.1 of the Trust Agreement for
disbursement pursuant to the Trust Agreement.
Section 3.2. Acquisition of Leased Property. The Lessor hereby agrees to acquire the
Leased Property through the deposit and disbursement of funds in accordance with Section 2.6 of
the Trust Agreement.
Section 3.3. Payment of Delivery Costs. The Trustee shall pay the Delivery Costs
from the moneys deposited with the Trustee in the Delivery Costs Fund as provided in Section
3.2, which shall be disbursed for this purpose in accordance and upon compliance with Article
III of the Trust Agreement.
Section 3.4. Unexpended Proceeds and Other Moneys. All excess moneys remaining
in the Delivery Costs Fund and not required for payment of Delivery Costs shall be transferred
by the Trustee to the Lease Payment Fund pursuant to Section 3.2 of the Trust Agreement and
applied as a Prepayment of the Lease Payments pursuant to Article X, and shall be applied to pay
the next-succeeding Lease Payments as the same become due and payable.
ARTICLE IV
AGREEMENT TO LEASE-PURCHASE; TERMINATION OF THIS AGREEMENT;
LEASE PAYMENTS; TITLE TO THE LEASED PROPERTY
Section 4.1. Lease-Purchase. The Lessor hereby leases the Leased Property to the
Lessee, and the Lessee hereby leases the Leased Property from the Lessor, upon the terms and
conditions set forth in this Lease.
Section 4.2. Term of Agreement; Termination.
(a) The Term of this Lease shall commence on the date of initial delivery of and
payment for the 2015 Certificates, and continue until the end of the Lessee’s current Fiscal
Period, and thereafter shall be deemed to automatically be extended by the Lessee for such
additional Fiscal Periods as are necessary to complete the anticipated total Lease term through
and including the final scheduled payment date on the Certificates, unless terminated earlier as
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provided herein. If on the final scheduled payment date on the Certificates, the Trust Agreement
shall not be discharged by its terms, then the Term of this Lease shall be extended until the Trust
Agreement shall be discharged by its terms. If prior to the final scheduled payment date on the
Certificates, the Trust Agreement shall be discharged by its terms, the Term of this Lease shall
thereupon end. Reference to the Term of this Lease shall include the initial and any extended
term.
(b) If the Lessee shall fail to obtain, on or before the third Business Day prior to the
last date on which the Lessee is required or permitted to adopt its budget for a Fiscal Period,
proper budgeting and final appropriation by the Lessee’s Board of the full amount of funds
necessary to make all Lease Payments coming due during the Fiscal Period for which such
budgeting and appropriation are made, the Lessee will immediately notify the Trustee in writing
of that fact. If on the last date on which the Lessee is required or permitted to adopt its budget
for a Fiscal Period no such proper budgeting and final appropriation by the Lessee’s Board shall
have been made, all of the Lessee’s right, title and interest in and future obligations under this
Lease and to all of the Leased Property shall terminate (subject to reinstatement as provided in
subsection (c)), due to an Event of Non-appropriation effective as of the last day of the last Fiscal
Period for which such budgeting and appropriation were properly obtained and for which
sufficient funds were determined to be lawfully available and allocated, and the Lessee shall be
relieved of any subsequent obligation under this Lease, other than to return the Lessor possession
of all of the Leased Property as provided in this Lease and to pay any accrued and unpaid
obligations.
(c) If this Lease terminates pursuant to subsection (b) and if within 45 days after such
date of termination amounts described in subsection (b) are determined to be available which
would have permitted this Lease to have continued in effect with respect to the Leased Property
if such amounts had been determined to be available prior to the termination date, then this Lease
shall be reinstated and deemed renewed as of the day following the date of such termination.
Section 4.3. Possession. The Lessee agrees to take immediate possession of the
Leased Property. The Lessee agrees to surrender possession of all the Leased Property upon
termination of this Lease for any reason (i) on the day following the 45 day reinstatement period
provided in Section 4.2(c) hereof or (ii) on the date set by the Lessor under Section 9.2(b) hereof.
To the maximum extent permitted by law, the Lessee agrees to hold the Lessor harmless for,
from and against any costs, loss or damage whatsoever to the Leased Property arising from or
occasioned by any removal of other property of the Lessee from the Leased Property due to such
termination.
Section 4.4. Lease Payments; Additional Rent; Other Payments.
(a) Obligation to Pay.
(i) Subject to the provisions of Section 4.2 and Articles VI and X, the Lessee
agrees to pay to the Lessor, as rental for the use and occupancy of the Leased Property,
the Lease Payments (denominated into components of principal and interest) in the
amounts specified in Exhibit C, to be due and payable on the Lease Payment Dates
specified in Exhibit C. Any amount held in the Lease Payment Fund on any Lease
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Payment Date (other than amounts resulting from the Prepayment of the Lease Payments
in part but not in whole pursuant to Article X), other than amounts required for payment
of past due principal or interest with respect to any Certificates not presented for payment
shall be credited towards the Lease Payments then due and payable, and no Lease
Payments need be made on any Lease Payment Date if the amounts then held in the
Lease Payment Fund (other than amounts resulting from the Prepayment of the Lease
Payments in part but not in whole pursuant to Article X hereof, other than amounts
required for payment of past due principal or interest with respect to any Certificates not
presented for payment are at least equal to the Lease Payments then required to be paid.
Each Fiscal Period’s Lease Payments shall be for the use of the Leased Property during
such Fiscal Period.
(ii) The obligations of the Lessee to pay Lease Payments and Additional Rent
as required in this Lease and the performance and observance of the other covenants and
agreements on the Lessee’s part contained herein shall be absolute and unconditional in
all aspects, except as specifically otherwise provided herein with respect to termination
upon an Event of Non-appropriation. During the term hereof, the Lessee (i) shall not
suspend or discontinue payment of the Lease Payments or Additional Rent during a
Fiscal Period as to which an Event of Non-appropriation has not occurred, (ii) shall
perform and observe all of its agreements contained herein, and will not terminate this
Lease for any reason, including, without limitation, any acts or circumstances that may
constitute destruction of or damage to the Leased Property, frustration of purpose, or any
failure of the Lessor to perform and observe any agreement whether express or implied,
or any duty, liability or obligation arising out of or connected with this Lease.
(iii) The Lessor acknowledges that it has been informed by the Lessee that,
pursuant to Arizona law, the Lessee’s obligation to make Lease Payments is a current
expense of the Lessee, payable exclusively from budgeting and appropriation for each
Fiscal Period, and is not a general obligation or indebtedness of the County.
(iv) Arizona law provides that, if the Lessee fails to budget and appropriate
money for any periodic payment or renewal term of a Lease, such agreement shall
terminate at the end of the current term and the Lessee shall be relieved of any
subsequent obligation under such agreement. The Lessee hereby covenants to make
Lease Payments and Additional Rents for all Fiscal Periods during the Lease Term if
funds are budgeted and appropriated by the Lessee’s Board for that purpose.
(v) The budget officials of the Lessee will include in the proposed annual
budget presented to the Lessee’s Board sufficient funds for payment of all Lease
Payments and Additional Rent when due, provided, however, the Lessor acknowledges
that pursuant to Arizona law, budgeting and appropriation of money by the County is a
legislative act of the Board and is beyond the control of the budgeting officials of the
Lessee.
(b) Effect of Prepayment. In the event that the Lessee prepays all remaining Lease
Payments and Additional Rent in full pursuant to Article X, the Lessee’s obligations under this
Lease-Payment Agreement shall thereupon cease and terminate, including but not limited to the
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Lessee’s obligation to pay Lease Payments under this Section. In the event the Lessee prepays
less than all of the remaining principal components of the Lease Payments and Additional Rent
pursuant to Sections 10.3 or 10.4, the principal and interest components of the remaining Lease
Payments shall be reduced proportionately such that the remaining Lease Payments correspond
to the remaining payments of principal and interest with respect to the Outstanding Certificates
(determined by reference to the Trust Agreement).
(c) Rate on Overdue Payments. In the event the Lessee should fail to make any of
the Lease Payments or Additional Rent required in this Section 4.4 during a Fiscal Period as to
which an Event of Non-appropriation has not occurred, the payment in default shall continue as
an obligation of the Lessee until the amount in default shall have been fully paid, and the Lessee
agrees to pay the same with interest thereon, to the extent permitted by law, from the date of
default to the date of payment at the rate of ___ percent (____%) per annum.
(d) Fair Rental Value. The Lease Payments and Additional Rent for each rental
payment period during the term of this Lease shall constitute the total rental for the Leased
Property for such rental payment period, and shall be paid by the Lessee in each rental payment
period for and in consideration of the right of the use and occupancy of, and the continued quiet
use and enjoyment of the Leased Property during each such period for which said rental is to be
paid. The parties hereto have agreed and determined that the total Lease Payments and
Additional Rent represent the fair rental value of the Leased Property. In making such
determination, consideration has been given to the appraised value of the Leased Property, other
obligations of the parties under this Lease, the uses and purposes which may be served by the
Leased Property and the benefits therefrom which will accrue to the Lessee and the general
public.
(e) Lessor as Trustee. The Lessee understands that all interest of the Lessor in and to
the Lease Payments and Additional Rent for the Leased Property is held by the Trustee in trust
pursuant to the Trust Agreement for the benefit of the Owners of the Certificates. The Lessee
hereby agrees to pay to the Trustee at the Trustee’s designated office, or to the Trustee at such
other place as the Trustee shall direct in writing, all Lease Payments and Additional Rent payable
by the Lessee pursuant to this Lease.
Section 4.5. Quiet Enjoyment. During the Term of this Lease the Lessee shall have
quiet use and enjoyment of the Leased Property, and the Lessee shall during such Term
peaceably and quietly have and hold and enjoy the Leased Property, without suit, trouble or
hindrance from the Lessor, except as expressly set forth in this Lease. The Lessor will, at the
request of the Lessee and at the Lessee’s cost, join in any legal action in which the Lessee asserts
its right to such possession and enjoyment to the extent the Lessor may lawfully do so.
Notwithstanding the foregoing, the Lessor shall have the right to inspect the Leased Property as
provided in Section 7.1 hereof.
Section 4.6. Title.
(a) Pursuant to the Ground Lease, the Lessee shall hold title to the Leased Property,
but subject to this Lease and the Lessor’s interest in the Ground Lease.
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(b) If the Lessee prepays the Lease Payments and Additional Rent in full pursuant to
Article X or makes the advance deposit required by Section 10.1, or pays all Lease Payments and
Additional Rent during the Term of this Lease as the same become due and payable, all right,
title and interest of the Lessor in and to the Leased Property shall be transferred to and vested in
the Lessee free and clear of this Lease. Such title shall vest in the Lessee without the necessity
of any additional payments or of any further instrument of transfer. The Lessor agrees to take
any and all steps and execute and record any and all documents reasonably required by the
Lessee to confirm such vesting of title.
Section 4.7. Additional Rent. In addition to the Lease Payments described in Section
4.4 hereof, the Lessee shall pay when due (a) all costs and expenses incurred by the Lessor or the
Trustee to comply with the provisions of the Trust Agreement, (b) payments required to be
deposited into the Rebate Fund pursuant to Section 8.8(c) of the Trust Agreement, (c)
compensation, expenses and any other amounts payable to the Trustee under Section 9.8 of the
Trust Agreement, (d) all amounts payable by the Lessee pursuant to Section 7.2 hereof, (e) all
costs and expenses of auditors, engineers, accountants and legal counsel, if necessary, but
excluding Delivery Costs (which shall be paid by the Lessor from moneys deposited in the
Delivery Costs Fund), and (f) all rent for any holdover period during which Lessee stays in
possession of the Leased Property after termination of this Lease, which rent shall be calculated
as: (i) number of days of holdover divided by (ii) 365 multiplied by (iii) the Lease Payments for
such Fiscal Period.
ARTICLE V
MAINTENANCE; TAXES; INSURANCE; AND OTHER MATTERS
Section 5.1. Maintenance, Utilities, Taxes and Assessments.
(a) Throughout the Term of this Lease, as part of the consideration for the rental of
the Leased Property, the Lessee shall repair and maintain the Leased Property, and the Lessee
shall pay for or otherwise arrange for the payment of all utility services supplied to the Leased
Property, which may include, without limitation, janitor service, security, power, gas, telephone,
light, heating, water and all other utility services, and shall pay for or otherwise arrange for the
payment of the cost of the repair and replacement of the Leased Property resulting from ordinary
wear and tear or want of care on the part of the Lessee or any assignee or sublessee thereof. In
exchange for the Lease Payments and Additional Rent herein provided, the Lessor agrees to
provide only the Leased Property as provided herein.
(b) The Lessee shall also pay or cause to be paid all taxes and assessments of any
type or nature, if any, charged to the Lessor, the Trustee or the Lessee affecting the Leased
Property (but not including income taxes), the respective interests or estates therein or the
taxability of any payments under this Lease; provided that with respect to special assessments or
other governmental charges that may lawfully be paid in installments over a period of years, the
Lessee shall be obligated to pay only such installments as are required to be paid during the
Term of this Lease as and when the same become due.
(c) The Lessee or any sublessee may, at the Lessee’s or such sublessee’s expense and
in its name, in good faith contest any such taxes, assessments, utility and other charges and, in
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the event of any such contest, may permit the taxes, assessments or other charges so contested to
remain unpaid during the period of such contest and any appeal therefrom unless the Lessor shall
notify the Lessee or such sublessee that, in the opinion of Independent Counsel, by nonpayment
of any such items, the interest of the Lessor in the Leased Property will be materially endangered
or the Leased Property or any part thereof will be subject to loss or forfeiture, in which event the
Lessee or such sublessee shall promptly pay such taxes, assessments or charges or provide the
Lessor with full security against any loss which may result from nonpayment, in form
satisfactory to the Lessor and the Trustee.
Section 5.2. Modification of Leased Property. The Lessee and any sublessee shall, at
their own expense, have the right to remodel any portion of the Leased Property or to make
additions, modifications and improvements to any portion of the Leased Property. All such
additions, modifications and improvements shall thereafter comprise part of the Leased Property
and be subject to the provisions of this Lease. Such additions, modifications and improvements
may not in any way damage the Leased Property or cause it to be used for purposes other than
those authorized under the provisions of State and federal law; and the Leased Property, upon
completion of any additions, modifications and improvements made thereto pursuant to this
Section, shall be of a value which is not substantially less than the value of such Leased Property
immediately prior to the making of such additions, modifications and improvements. The Lessee
will not permit any mechanic’s or other lien to be established or remain against the Leased
Property for labor or materials furnished in connection with any remodeling, additions,
modifications, improvements, repairs, renewals or replacements made by the Lessee or any
sublessee or assignee pursuant to this Section; provided that if any such lien is established and
the Lessee shall first notify or cause to be notified the Lessor of the Lessee’s or any sublessee’s
intention to do so, the Lessee or any sublessee may in good faith contest any lien filed or
established against the Leased Property, and in such event may permit the items so contested to
remain undischarged and unsatisfied during the period of such contest and any appeal therefrom
and shall provide the Lessor with full security against any loss or forfeiture which might arise
from the nonpayment of any such item, in form satisfactory to the Lessor. The Lessor will
cooperate fully in any such contest, upon the request and at the expense of the Lessee or such
sublessee.
Section 5.3. General Liability Insurance. The Lessee shall maintain or cause to be
maintained, throughout the Term of this Lease, a standard commercial general insurance policy
or policies with a responsible insurance company or companies authorized under the laws of the
State to assume such risks, of such types and in such amounts as are determined by the Lessee to
be customary for similar institutions carrying on similar activities to those carried on the Leased
Property. Said policy or policies, or Qualified Self-Insurance as discussed below, shall, to the
extent permitted by law, name the Lessor and the Trustee as additional insureds and shall provide
for coverage against direct or contingent loss or liability for damages for bodily and personal
injury, death or property damage occasioned by reason of the construction or operation of the
Leased Property; provided, however, to the extent the Lessor or the Trustee are not named as
additional insureds under any insurance, the Lessee hereby assigns to the Lessor and the Trustee
its rights to receive any or all proceeds received from such insurance as their respective interests
or rights under this Lease may appear on the date of payment thereof. Such liability insurance
may be maintained as part of or in conjunction with any other liability insurance coverage
carried or required to be carried by the Lessee. The proceeds of such liability insurance shall be
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applied toward extinguishment or satisfaction of the liability with respect to which the proceeds
of such insurance shall have been paid.
Section 5.4. Casualty and Property Coverage Insurance. The Lessee shall procure
and maintain, or cause to be procured and maintained, throughout the Term of this Lease,
insurance against loss or damage to any structures or equipment constituting any part of the
Leased Property by fire and lightning, with extended coverage and vandalism and malicious
mischief insurance. Said extended coverage insurance shall, as nearly as practicable, cover loss
or damage by explosion, windstorm, riot, aircraft, vehicle damage, smoke and such other hazards
as are normally covered by such insurance then in existence. Such insurance shall be in an
amount equal to one hundred percent (100%) of the replacement cost of the Leased Property then
in existence. Such insurance may be subject to deductible clauses of not to exceed $500,000 for
any one loss. Such insurance may be maintained as part of or in conjunction with any other fire
and extended coverage insurance carried or required to be carried by the Lessee and may be
maintained in the form of Qualified Self-Insurance by the Lessee. Said policy or policies, or any
Qualified Self-Insurance, shall, to the extent permitted by law, provide for insuring the Lessor,
the Trustee and the Lessee against such loss or damage; provided, however, to the extent the
Lessor or the Trustee are not named as loss payees under any insurance or Qualified Self-
Insurance, the Lessee hereby assigns to the Lessor and the Trustee its rights to receive any or all
proceeds received from such insurance or Qualified Self-Insurance as their respective interests or
rights under this Lease may appear on the date of payment thereof. The Net Proceeds of such
insurance shall be applied as provided in Section 6.2(a) of this Lease.
Section 5.5. Title Insurance. The Lessee shall provide, at its own expense, on or
before the Closing Date, a binding commitment to issue a title insurance policy in form
satisfactory to the Lessor in the amount of not less than the initial aggregate principal amount of
the 2015 Certificates insuring the Trustee’s interest in the Leased Property under the Ground
Lease and this Lease, subject only to Permitted Encumbrances and the actual policy promptly
after the Closing Date.
Section 5.6. Insurance Net Proceeds; Form of Policies. Each policy of insurance
required by Sections 5.4 and 5.5 hereof shall provide that all proceeds thereunder shall be
payable to the Lessor or assigned to the Lessor by the Lessee pursuant to Sections 5.3 and 5.4
hereof and applied as provided in Section 6.2 hereof. All policies of insurance required by this
Lease and any statements of self-insurance shall be in form satisfactory to the Lessor. The
Lessee shall pay or cause to be paid when due the premiums for all insurance policies required
by this Lease, and shall promptly furnish or cause to be furnished evidence of such payments to
the Lessor. All such policies shall provide that the Lessor shall be given 30 days’ notice of each
expiration, any intended cancellation thereof or reduction of the coverage provided thereby. The
Lessor shall not be responsible for the sufficiency of any insurance herein required and shall be
fully protected in accepting payment on account of such insurance or any adjustment,
compromise or settlement of any loss agreed to by the Lessee. The Lessee shall cause to be
delivered to the Lessor annually evidence satisfactory to the Lessor that the insurance policies
required by this Lease are in full force and effect. In the event the Lessee maintains self-
insurance for the insurance required by Sections 5.3 and 5.4 hereof, the Lessee shall cause to be
delivered to the Lessor annually the documentation required for the determination that such self-
insurance constitutes Qualified Self-Insurance. The Lessee shall furnish an annual certificate
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stating that the insurance in effect meets the requirements of Sections 5.3, 5.4 and 5.6 of this
Lease.
Section 5.7. Advances. If the Lessee shall fail to perform any of its obligations under
this Article, the Trustee may, but shall not be obligated to, take such action as may be necessary
to cure such failure, including the advancement of money, and the Lessee shall be obligated to
repay all such advances as Additional Rent as soon as possible, with interest at the rate of ten
percent (10%) per annum from the date of the advance to the date of repayment.
Section 5.8. Installation of Lessee’s Equipment. The Lessee and any sublessee may
at any time and from time to time, in its sole discretion and at its own expense, install or permit
to be installed other items of equipment or other personal property in or upon the Leased
Property. All such items shall remain the sole property of such party, in which neither the Lessor
nor the Trustee shall have any interest, and may be modified or removed by such party at any
time provided that such party shall repair and restore any and all damage to the Leased Property
resulting from the installation, modification or removal of any such items. Nothing in this Lease
shall prevent the Lessee and any sublessee from purchasing or leasing items to be installed
pursuant to this Section under a lease or conditional sale agreement, or subject to a vendor’s lien
or security agreement, as security for the unpaid portion of the purchase price thereof, provided
that no such lien or security interest shall attach to any part of the Leased Property.
Section 5.9. Liens. The Lessee shall not, directly or indirectly, create, incur, assume
or suffer to exist any mortgage, pledge, lien, charge, encumbrance or claim on or with respect to
the Leased Property, other than the respective rights of the Lessor and the Lessee as herein
provided and Permitted Encumbrances. Except as expressly provided in this Article, the Lessee
shall promptly, at its own expense, take such action as may be necessary to duly discharge or
remove any such mortgage, pledge, lien, charge, encumbrance or claim, for which it is
responsible, if the same shall arise at any time. The Lessee shall reimburse the Lessor for any
expense incurred by it in order to discharge or remove any such mortgage, pledge, lien, charge,
encumbrance or claim.
Section 5.10. Delivery of Leased Property Upon Termination.
Lessee shall, (i) upon the early termination of this Lease or (ii) on the date set by the
Lessor under Section 9.2(b), deliver the Leased Property to the Lessor, or another person, as
directed by the Lessor, in at least as good condition and repair as when delivered to Lessee,
ordinary wear and tear excepted. The Leased Property shall be delivered to the Lessor, or
another person, as directed by the Lessor, as herein required, free and clear of all liens,
encumbrances and rights of others except Permitted Encumbrances.
ARTICLE VI
DAMAGE, DESTRUCTION AND EMINENT DOMAIN;
USE OF NET PROCEEDS
Section 6.1. Damage, Destruction and Condemnation. If, during the Lease Term,
(a) the Leased Property shall be destroyed (in whole or in part), or damaged by fire or
other casualty; or
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(b) title to, or the temporary or permanent use of, the Leased Property or the estate of
the County or the Trustee in the Leased Property is taken under the exercise of the power of
eminent domain by any governmental body or by any person, firm or entity acting under
governmental authority; or
(c) a breach of warranty or a material defect in the construction, manufacture or
design of the Leased Property becomes apparent; or
(d) title to or the use of all or a portion of the Leased Property is lost by reason of a
defect in title;
then the County shall be obligated to continue to pay Lease Payments and Additional Rent
(subject to Article IV hereof).
Section 6.2. Obligation to Repair and Replace the Leased Property.
(a) The County and the Trustee, to the extent Net Proceeds are within their respective
control, shall cause Net Proceeds of any insurance policies, performance bonds or condemnation
awards to be deposited in a separate trust fund. All Net Proceeds so deposited shall be applied to
the prompt repair, restoration, modification, improvement or replacement of the Leased Property
by the County, upon receipt of requisitions signed by the Lessee Representative stating with
respect to each payment to be made:
(i) the requisition number;
(ii) the name and address of the person, firm or entity to whom payment is
due;
(iii) the amount to be paid; and
(iv) that each obligation mentioned has been properly incurred, is a proper
charge against the separate trust fund and has not been the basis of any previous
withdrawal and specifying in reasonable detail the nature of the obligation, accompanied
by a bill or a statement of account.
(b) The County and the Trustee agree to cooperate and use their best reasonable
efforts subject to the terms of the Trust Agreement to enforce claims which may arise in
connection with material defects in the construction, manufacture or design of the Leased
Property or otherwise. If there is a balance of any Net Proceeds allocable to the Leased Property
remaining after such repair, restoration, modification, improvement or replacement has been
completed, this balance shall be used by the County, to:
(i) add to, modify or alter the Leased Property or add new components
thereto, or
(ii) prepay the Lease Payments with a corresponding adjustment in the amount
of Lease Payments payable under Exhibit C (Schedule of Lease Payments) to this Lease
or
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(iii) accomplish a combination of (i) and (ii).
(c) Any repair, restoration, modification, improvement or replacement of the Leased
Property paid for in whole or in part out of Net Proceeds allocable to the Leased Property shall
be the property of the County, subject to this Lease and the Trust Agreement and shall be
included as part of the Leased Property under this Lease.
Section 6.3. Reduction of Rental in the Event of Prepayment of Lease Payments. In
the event the Net Proceeds of any insurance or condemnation awards are deposited in the Lease
Payment Fund and credited towards Prepayments pursuant to Section 10.4 of this Lease, the
amount of remaining Lease Payments shall be reduced proportionately as to the principal and
interest components thereof such that the resulting Lease Payments will correspond to the
remaining payments of principal of and interest on the Outstanding Certificates (after any
redemption of Certificates pursuant to Section 4.2 of the Trust Agreement resulting from such
Prepayments), which resulting Lease Payments are hereby deemed to represent fair consideration
for the use and occupancy of the portions of the Leased Property not taken, damaged or
destroyed. In the event of any such reduction, this Lease shall continue in full force and effect
and the lessee waives any right to terminate this Lease by virtue of any damage or destruction of
the Leased Property causing such reduction of Lease Payments.
Section 6.4. Cooperation of the Trustee. The Trustee shall cooperate fully with the
County in filing any proof of loss with respect to any insurance policy or performance bond
covering the events described in Section 6.1 of this Lease and in the prosecution or defense of
any prospective or pending condemnation proceeding with respect to the Leased Property and
the enforcement of all warranties relating to the Leased Property. So long as no Event of Lease
Default or Event of Non-appropriation has occurred and is then existing, the Trustee shall not
voluntarily settle, or consent to the settlement of, any proceeding arising out of any insurance
claim performance or payment bond claim, prospective or pending condemnation proceeding
with respect to the Leased Property without the written consent of the County.
ARTICLE VII
ACCESS TO LEASED PROPERTY, INDEMNIFICATION
Section 7.1. Access to the Leased Property. The Lessee agrees that the Lessor and
any Lessor Representative shall have the right at all reasonable times to enter upon and into the
Leased Property and to examine and inspect the Leased Property. The Lessee further agrees that
the Lessor, any Lessor Representative, and the Lessor’s successors or assigns shall have such
rights of access to the Leased Property as may be reasonably necessary to cause the proper
maintenance of the Leased Property in the event of failure by the Lessee to perform its
obligations hereunder.
Section 7.2. Release and Indemnification Covenants. To the extent permitted by law,
the Lessee agrees to indemnify and save the Trustee and the Lessor harmless for, from and
against all claims, losses and damages, including legal fees and expenses, arising out of (i) the
ownership, use, maintenance, condition or management of, or from any work or thing done on,
the Leased Property, (ii) any breach or default on the part of the Lessee in the performance of
any of its obligations under this Lease or of any of its representations or warranties under this
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Lease, (iii) any act or negligence of the Lessee or of any of its agents, contractors, servants,
employees or licensees with respect to the Leased Property, (iv) any act or negligence of any
sublessee of the Lessee with respect to the Leased Property, or (v) the acquisition and
construction of the Leased Property, the execution and delivery of this Lease, the Ground Lease
and the Trust Agreement, and the execution, delivery and sale of the Certificates. No
indemnification is made under this Section or elsewhere in this Lease for claims successfully
brought for willful misconduct, negligence, or breach of duty under this Lease by the Lessor or
its officers, agents, employees, successors or assigns. The indemnification made under this
Section shall survive the termination or expiration of this Lease and the redemption or
defeasance of the Certificates.
ARTICLE VIII
ASSIGNMENT, SUBLEASING AND AMENDMENT
Section 8.1. Assignment and Subleasing by the Lessee. This Lease may not be
assigned by the Lessee. The Leased Property may be subleased through agreements in existence
on the Closing Date and extensions and renewals thereof, and the Leased Property may be
otherwise subleased only with the written consent of the Lessor, which consent shall not be
unreasonably withheld, and subject to all of the following conditions:
(a) This Lease and the obligation of the Lessee to make Lease Payments shall remain
obligations of the Lessee;
(b) The Lessee shall, within 30 days after signing, furnish or cause to be furnished to
the Lessor a true and complete copy of such sublease;
(c) No such sublease by the Lessee shall cause any of the Leased Property to be used
for a purpose other than exclusively for a governmental activity; and
(d) The Lessee shall furnish the Lessor with a written opinion of Bond Counsel, with
respect to any such sublease, stating that such sublease shall not adversely affect the exclusion of
the interest components of the Lease Payments from gross income for federal income tax
purposes when paid to the Owners of the 2015 Certificates.
Section 8.2. Amendment of this Lease. Without the written consent of the Trustee,
neither the Lessor nor the Lessee will alter, modify or cancel, or agree or consent to alter, modify
or cancel this Lease, excepting only such alteration or modification as may be permitted by
Article X of the Trust Agreement.
Section 8.3. Release of Leased Property. If, during the Term of the Lease, the Lessee
desires to release any portion of the Leased Property, the Lessor shall sell or convey all its right,
title, and interest in such portion of the Leased Property to the Lessee, provided the following
conditions are met, to wit:
(a) Maintenance of Value. The replacement value for insurance purposes, as certified
by the County, of the remaining properties comprising the Leased Property shall not be less than
the Outstanding principal amount of the Certificates;
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(b) No Reduction in Lease Payments. The release of property shall not cause any
decrease in the total Lease Payments required to be made under the Lease or any change in the
interest component or principal component thereof; and
(c) No Adverse Tax Effect. The Lessee shall furnish to the Trustee an opinion of
Bond Counsel acceptable to the Trustee that the release of property will not adversely affect the
exclusion of the interest payable on the Certificates from the federal gross income of the owners
thereof.
ARTICLE IX
EVENTS OF LEASE DEFAULT AND REMEDIES
Section 9.1. Events of Lease Default Defined.
(a) Any one or more of the following events shall be Events of Lease Default:
(i) Failure by the Lessee to pay any Lease Payment or other payment required
to be paid hereunder at the time specified herein during a Fiscal Period as to which an
Event of Non-appropriation has not occurred, and the continuation of such failure for a
period of five days.
(ii) Failure by the Lessee to observe and perform any covenant, condition or
agreement on its part to be observed or performed under the Trust Agreement, the
Ground Lease or this Lease, other than as referred to in clause (i) of this Section, for a
period of 30 days after written notice specifying such failure and requesting that it be
remedied has been given to the Lessee by the Lessor, the Trustee or the Owners of not
less than five percent in aggregate principal amount of Certificates then Outstanding;
provided, however, if the failure stated in the notice can be corrected, but not within the
applicable period, neither the Lessor, the Trustee nor such Owners shall unreasonably
withhold their consent to an extension of such time if corrective action is instituted by the
Lessee within the applicable period and diligently pursued until the default is corrected.
(iii) The filing by the Lessee of a voluntary petition in bankruptcy, or failure
by the Lessee promptly to lift any execution, garnishment or attachment, or adjudication
of the Lessee as a bankrupt, or assignment by the Lessee for the benefit of creditors, or
the entry by the Lessee into an agreement of composition with creditors, or the approval
by a court of competent jurisdiction of a petition applicable to the Lessee in any
proceedings instituted under the provisions of the federal bankruptcy statute, as amended,
or under any similar acts which may hereafter be enacted.
(b) Notwithstanding the foregoing, if, by reason of Force Majeure, the Lessee is
unable to perform or observe any agreement, term or condition of this Lease, other than any
obligation to make Lease Payments or Additional Rent required under this Lease, the Lessee
shall not be deemed in default during the continuance of such inability. However, the Lessee
shall promptly give notice to the Lessor of existence of any event of Force Majeure and shall use
its best efforts to remove the effects thereof; provided that the settlement of strike or labor
disturbances shall be entirely within the Lessee’s discretion. For the purpose of this subsection,
the term “Force Majeure” shall mean, without limitation: Acts of God; strikes, lockouts or other
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labor disturbances; acts of public enemies; orders or restraints of any kind of the government of
the United States or any of its departments, agencies, political subdivisions, courts or officials, or
any civil or military authority; insurrections; civil disturbances; riots; epidemics; landslides;
lightning; earthquakes; fires; hurricanes; tornados; storms; droughts; floods; arrests; explosions;
breakage, malfunction or accident to facilities, machinery, transmission pipes or canals; partial or
entire failure of utilities; shortages of labor, materials, supplies or transportation.
Section 9.2. Remedies.
(a) Whenever any Event of Lease Default shall have happened and be continuing, the
Lessor may exercise any and all remedies available pursuant to law or granted pursuant to this
Lease including, without limitation, excluding the Lessee from the Leased Property. There shall
be no right under any circumstances to accelerate the Lease Payments or Additional Rent or
otherwise declare any Lease Payments or Additional Rent not then in default to be immediately
due and payable. Each and every covenant to be kept and performed by the Lessee is expressly
made a condition and upon the breach the Lessor may exercise any and all rights of entry and re-
entry upon or into the Leased Property and also, at its option, with or without such entry, may,
subject to the Certificate Owner’s rights provided in Section 9.7, terminate this Lease. No such
termination shall be effected either by operation of law or acts of the parties hereto, except only
in the manner herein expressly provided. In the event of such default:
(i) In the event the Lessor does not elect to terminate this Lease in the manner
hereinafter provided for in subparagraph (b) below, the Lessee hereby irrevocably
appoints the Lessor as the agent and attorney-in-fact of the Lessee to enter upon and take
possession of the Leased Property, to the exclusion of the Lessee, and relet the Lessee’s
interests in the Leased Property and to remove all personal property not constituting
Leased Property and to place such property in storage or other suitable place in the
Maricopa County, State of Arizona, for the account of and at the expense of the Lessee,
and, to the extent permitted by law, the Lessee hereby exempts and agrees to save
harmless the Lessor for, from and against any costs, loss or damage whatsoever arising or
occasioned by any such entry upon and reletting of the Leased Property and the removal
and storage of personal property by the Lessor or its duly authorized agents in accordance
with the provisions herein contained. The Lessee hereby waives any and all claims for
damages caused or which may be caused by the Lessor in reentering and taking
possession of the Leased Property as herein provided and all claims for damages that may
result from the destruction of or injury to the Leased Property and all claims for damages
to or loss of any property belonging to the Lessee that may be in or upon the Leased
Property.
(ii) The Lessee agrees that the terms of this Lease constitute full and sufficient
notice of the right of the Lessor to take possession of or re-rent the Leased Property in the
event of such reentry without effecting a surrender of this Lease, and further agrees that
no acts of the Lessor in effecting such re-renting or re-leasing shall constitute a surrender
or termination of this Lease irrespective of the term for which such re-leasing or re-
renting is made or the terms and conditions of such re-leasing or re-renting, or otherwise,
but that, on the contrary, in the event of such default by the Lessee the right to terminate
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this Lease shall vest in the Lessor to be effected only in the manner provided for in
subparagraph (b).
(b) In an Event of Lease Default, the Lessor at its option may terminate this Lease
and sell, convey, re-rent, or re-lease all or any portion of its interests in the Leased Property any
may exclude the Lessee from the Leased Property. Neither notice to pay rent or to deliver up
possession of the premises given pursuant to law nor any proceeding in unlawful detainer taken
by the Lessor shall of itself operate to terminate this Lease and no termination of this Lease on
account of default by the Lessee shall be or become effective by operation of law, or otherwise,
unless and until the Lessor shall have given written notice to the Lessee of the election on the
part of the Lessor to terminate this Lease. The Lessee covenants and agrees that no surrender of
the Leased Property or of the remainder of the term hereof or any termination of this Lease shall
be valid in any manner or for any purpose whatsoever unless stated or accepted by the Lessor by
such written notice. Additionally, to the extent permitted by law, the Lessee hereby exempts and
agrees to save harmless the Lessor for, from and against any costs, loss or damage whatsoever to
the Leased Property arising or occasioned by any removal of other property of the Lessee from
the Leased Property by the Lessor or its duly authorized agents in accordance with the provisions
contained in this Lease.
Section 9.3. No Remedy Exclusive. No remedy conferred upon or reserved to the
Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Lease or now or hereafter existing at law or in
equity. No delay or omission to exercise any right or power accruing upon any default shall
impair any such right or power or shall be construed to be a waiver, but any such right and power
may be exercised from time to time and as often as may be deemed expedient. In order to entitle
the Lessor to exercise any remedy reserved to it in this Article it shall not be necessary to give
any notice, other than such notice as may be required in this Article or by law.
Section 9.4. Agreement to Pay Attorneys’ Fees and Expenses. In the event either
party to this Lease should default under any provisions of this Lease and the nondefaulting party
should employ attorneys or incur other expenses for the collection of moneys or the enforcement
or performance or observance of any obligation or agreement on the part of the defaulting party,
the defaulting party agrees that it will on demand pay to the nondefaulting party, to the extent
permitted by law, the fees of such attorneys and such other expenses so incurred by the
nondefaulting party.
Section 9.5. No Additional Waiver Implied by One Waiver. In the event any
agreement contained in this Lease should be breached by either party and thereafter waived by
the other party, such waiver shall be limited to the particular breach so waived and shall not be
deemed to waive any other breach.
Section 9.6. Application of Proceeds. All Net Proceeds received from the sale, re-
lease or other disposition of the Leased Property under this Article IX, and all other amounts
derived by the Lessor as a result of an Event of Lease Default hereunder, shall be applied as
provided in Section 13.3 of the Trust Agreement.
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Section 9.7. Trustee and Certificate Owners to Exercise Rights. Such rights and
remedies as are given to the Lessor under this Article IX shall be exercised by the Trustee and
the Owners of the Certificates as provided in the Trust Agreement.
ARTICLE X
PREPAYMENT OF LEASE PAYMENTS
Section 10.1. Security Deposit. The Lessee may on any date secure the payment of
Lease Payments by a deposit with the Trustee of (i) an amount in cash which, in the judgment of
the Trustee, together with amounts on deposit in the Lease Payment Fund is sufficient to pay all
unpaid Lease Payments and Additional Rent, including the principal and interest components of
Lease Payments, in accordance with the Lease Payment Schedule set forth in Exhibit C, or (ii)
Defeasance Obligations, together with cash, if required, in such amount as will, in the opinion of
an independent certified public accountant acceptable to the Trustee, together with interest to
accrue thereon but without reinvestment thereof and, if required, all or a portion of moneys or
Defeasance Obligations then on deposit in the Lease Payment Fund, be fully sufficient to pay all
unpaid Lease Payments and Additional Rent on their respective due dates or by Prepayment
thereof pursuant to Section 10.2, as the Lessee shall instruct at the time of said deposit. In the
event of a deposit pursuant to this Section and upon the defeasance of all the Certificates
pursuant to Section 14.1 of the Trust Agreement, all obligations of the Lessee under this Lease
(except those which survive termination of this Lease), and all security provided by this Lease
for said obligations, shall cease and terminate, excepting only the obligations of the Lessee to
make, or cause to be made, Lease Payments and Additional Rent from the deposit made by the
Lessee pursuant to this Section, and if the Trust Agreement has been discharged, title to the
Leased Property shall vest in the Lessee on the date of said deposit automatically and without
further action by the Lessee or the Lessor. Said deposit shall be deemed to be and shall
constitute a special fund for the payment of Lease Payments and Additional Rent in accordance
with the provisions of this Lease.
Section 10.2. Purchase Option. The Lessee may exercise its option to purchase all of
the Lessor’s interests in the Leased Property on any Prepayment Date, by paying the applicable
Prepayment Price together with Additional Rent and the interest component of the Lease
Payment required to be paid on such Prepayment Date to effect the redemption of Certificates
pursuant to Section 4.2(a) of the Trust Agreement and a deposit described in Section 10.1
sufficient to secure all unpaid Lease Payments necessary to provide for the payment of principal
of and interest evidenced by the Certificates not subject to redemption or which are not being
redeemed. Except as otherwise provided in the Trust Agreement, such Prepayment Price shall be
deposited by the Trustee in the Lease Payment Fund to be applied to the redemption of
Certificates pursuant to Section 4.2(a) of the Trust Agreement. The Lessee shall give the Trustee
notice of its intention to exercise its option not less than 45 days in advance of the date of
exercise unless the Trustee agrees to a shorter notice period.
Section 10.3. Optional Prepayment. The Lessee may prepay the Lease Payments, in
whole or in part, at any time. Such Prepayments shall be deposited in the Lease Payment Fund
and applied to the payment or redemption of Certificates as provided in Articles II and IV of the
Trust Agreement or, if the Certificates are not subject to redemption at the time of such deposit,
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shall be applied as provided in Section 14.1 of the Trust Agreement to provide for the payment
of Certificates as directed by the Lessee.
Section 10.4. Mandatory Prepayment From Net Proceeds of Insurance, Eminent
Domain. The Lessee shall be obligated to prepay the Lease Payments allocable to the Leased
Property, in whole or in part, on any _____ 15 or _____ 15, or the next succeeding Business Day
if such date is not a Business Day, from and to the extent of any Net Proceeds of insurance award
or condemnation awards with respect to the Leased Property theretofore deposited in the Lease
Payment Fund for such purpose pursuant to Articles V, VI, IX or X hereof or pursuant to Section
7.2 of the Trust Agreement. The Lessee and the Lessor hereby agree that such Net Proceeds, to
the extent remaining after payment of any delinquent Lease Payments, shall be credited towards
the Lessee’s obligations under this Section and shall be applied to the mandatory redemption of
Certificates required by Section 4.2(b) of the Trust Agreement.
Section 10.5. Credit for Amounts on Deposit. In the event of Prepayment of the
principal components of the Lease Payments and Additional Rent in full under this Article X,
such that the Trust Agreement shall be discharged by its terms as a result of such Prepayment, all
amounts then on deposit in the Lease Payment Fund shall be credited towards the amounts then
required to be so prepaid.
ARTICLE XI
MISCELLANEOUS
Section 11.1. Notices. Except as expressly provided otherwise in this Lease, all
notices or other communications required or permitted under this Lease must be in writing and
will be deemed sufficiently given if sent (i) by facsimile or electronic mail with prompt
telephonic confirmation of receipt; or (ii) personally by hand (whether by messenger, telegram or
otherwise); by overnight delivery service; or by first class mail, postage prepaid and addressed as
shown below or at such address as the party may provide to the other party in writing from time
to time, and shall be deemed to have been received except that notice to the Lessor or the Trustee
shall be effective only upon receipt by an officer responsible for the performance of duties and
obligations under this Lease.
If to the Lessee:
Maricopa County, Arizona
301 West Jefferson, Suite 960
Phoenix, AZ 85003-2903
Attention: Chief Financial Officer
Fax: (602) 506-4451
If to the Lessor and the Trustee:
___________________________
___________________________
___________________________
Attention: Corporate Trust
Fax: (___) __________________
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The parties by written notice, may designate different addresses to which subsequent
notices, certificates or other communications will be sent.
Section 11.2. Binding Effect. This Lease shall inure to the benefit of and shall be
binding upon the Lessor and the Lessee and their respective successors and assigns.
Section 11.3. Severability. In the event any provision of this Lease shall be held
invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate
or render unenforceable any other provision.
Section 11.4. Net-net-net Lease. This Lease shall be deemed and construed to be a
“net-net-net Lease” and the Lessee hereby agrees that the Lease Payments shall be an absolute
net return to the Lessor, free and clear of any expenses, charges or set-offs whatsoever,
irrespective of any defense or any right of recoupment or counterclaim which the Lessee may
have against the Lessor or the Trustee.
Section 11.5. Further Assurances and Corrective Instruments. The Lessor and the
Lessee agree that they will, from time to time, execute, acknowledge and deliver, or cause to be
executed, acknowledged and delivered, such further instruments as may reasonably be required
for correcting any inadequate or incorrect description of the Leased Property.
Section 11.6. Execution in Counterparts. This Lease may be executed in several
counterparts, each of which shall be an original and all of which shall constitute but one and the
same instrument.
Section 11.7. Applicable Law. This Lease shall be governed by and construed in
accordance with the laws of the State.
Section 11.8. Lessor and Lessee Representatives. Whenever under the provisions of
this Lease the approval of the Lessor or the Lessee is required, or the Lessor or the Lessee is
required to take some action at the request of the other, such approval or such request shall be
given for the Lessor by a Lessor Representative and for the Lessee by a Lessee Representative,
and any party hereto shall be authorized to rely upon any such approval or request.
Section 11.9. Captions. The captions or headings in this Lease are for convenience
only and in no way define, limit or describe the scope or intent of any provisions or Section of
this Lease.
Section 11.10. Cancellation of Contracts. As required by the provisions of Arizona
Revised Statutes Section 38-511, as amended, notice is hereby given that the Lessee may cancel
any contract, without penalty or further obligation, made by the Lessee if any person
significantly involved in initiating, negotiating, securing, drafting or creating the contract on
behalf of the Lessee is, at any time while the contract or any extension of the contract is in effect,
an employee of any other party to the contract in any capacity or a consultant to any other party
of the contract with respect to the subject matter of the contract. The cancellation shall be
effective when written notice from the Lessee’s Board is received by all other parties to the
contract unless the notice specifies a later time. All parties represent that to the best of their
knowledge, no basis exists for the Lessee to cancel this Lease pursuant to Arizona Revised
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Statutes Section 38-511 as of the date of signing this Lease. The Lessor covenants not to employ
as an employee, an agent or, with respect to the subject matter of this Lease, a consultant, any
person significantly involved in initiating, negotiating, securing, drafting or creating this Lease
on behalf of the Lessee within three years from execution of this Lease, unless a waiver of
A.R.S. § 38-511 is provided by the Lessee’s Board.
[Signature page follows]
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The parties are signing this Lease as of the date stated in the introductory clause.
___________________________, as Lessor
By:
Authorized Officer
MARICOPA COUNTY, ARIZONA,
as Lessee
By:
Title:
APPROVED AS TO FORM:
SQUIRE PATTON BOGGS (US) LLP,
Bond Counsel to the County
By:
[Signature page to Lease]
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STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the ___ day of ____________, 2015 before me, the undersigned Notary Public,
personally appeared ___________________, who acknowledged himself to be a _____________
of __________________________ a national banking association organized and existing under
the laws of the United States of America, and that he, as such officer, being authorized so to do,
executed the foregoing Lease for the purposes therein contained by signing the name of the
association by himself as such officer.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
Notary Public
My Commission Expires:
[Trustee notarization page to Lease]
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STATE OF ARIZONA )
) ss.
County of Maricopa )
On this, the ___ day of _____________, 2015 before me, the undersigned Notary Public,
personally appeared Steve Chucri, who acknowledged himself to be Chairman of the Board of
Supervisors of Maricopa County, Arizona, and that he, as such officer, being authorized so to do,
executed the foregoing Lease for the purposes therein contained by signing the name of said
County by himself as such officer.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
Notary Public
My Commission Expires:
[County notarization page to Lease]
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EXHIBIT A
DESCRIPTION OF LEASED PROPERTY
General Description: South Court Tower
Legal Description:
A-1
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EXHIBIT B
PERMITTED ENCUMBRANCES
“Permitted Encumbrances” means, as of any particular time: (i) liens for general ad
valorem taxes and assessments, if any, not then delinquent, or which the Lessee may, pursuant to
provisions of Article V of the Lease, permit to remain unpaid; (ii) the Lease; (iii) the Ground
Lease; (iv) the Trust Agreement; and (v) the easements, leases, encumbrances, rights of way,
mineral rights, drilling rights and other rights, reservations, covenants, conditions or restrictions
which exist as of the Closing Date, as shown below and which the County represents will not
materially impair the use of the Leased Property for purposes of the Lease.
The easements, leases, encumbrances, rights of way, mineral rights, drilling rights and
other rights, reservations, covenants, conditions or restrictions which exist as of the Closing Date
are as follows:
[Insert from Schedule B of Title Commitment]
B-1
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EXHIBIT C
SCHEDULE OF LEASE PAYMENTS
The following are the Lease Payments to be paid pursuant to the Lease so long as no
Determination of Taxability has occurred.
Certificates of Participation
Principal Interest Total
Date Component Component Lease Payment
$ $ $
Total $ $ $
C-1
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