Sent Via Email: bhandke@myexchangebank.com   July 15, 2013    Brian Handke Exchange National Bank & Trust  

Re:  Financing for USD #377, Atchison County Community School District of Four (4) 2014 International 60 

Passenger School Buses  Dear Mr. Handke:  Please  find the enclosed documentation  for your review and completion.   The documentation has been filled out according to the terms and amount shown on the Documentation Summary Sheet.  An instruction sheet has been included as a guide to assist you with the process.         Please  note  that  an  invoice  for  $500.00  is  enclosed  for  the  preparation  of  the  documents.    Please  remit payment to Baystone Financial Group, 1680 Charles Place, Manhattan, KS  66502.  If you have any questions regarding the above documentation, please feel free to contact me.  Sincerely,    Andrea Parsons Assistant Vice President  

    1680 Charles Place Manhattan, KS  66502 

 

 

   

DATE: July 15, 2013 

 

To:   

Exchange National Bank & Trust  Re: Financing for USD #377, Atchison County Community School District PO Box 249, 423 Main Street 

Effingham, Kansas 66023          

 DESCRIPTION   AMOUNT 

Preparation of personal property documents for the USD #377, Atchison County Community School District 

$500.00 

Fee is due upon receipt of documents   

   

   

   

   

   

SUBTOTAL  $500.00 

SALES TAX   

SHIPPING & HANDLING   

TOTAL DUE  $500.00 

 

Make all checks payable to: Baystone Financial Group, 1680 Charles Place, Manhattan, KS  66502  If you have any questions concerning this invoice, call: Andrea Parsons @ 800‐752‐3562.  

Documentation Instructions

The instructions listed below should be followed when completing the enclosed documentation. Documentation completed improperly will delay funding. If you have any questions regarding the instructions or the documentation, please call us.

I. LEASE WITH OPTION TO PURCHASE AGREEMENT

EXCEPT AS NOTED, ALL SIGNATURES MUST BE BY THE PERSON OR PERSONS AUTHORIZED IN EXHIBIT D

1. The Agreement Sign and print name and title

2. Exhibit A - DESCRIPTION OF EQUIPMENT Type the location where the equipment will be located after delivery/installation.

3. Exhibit B - PAYMENT SCHEDULE Sign and print name and title

4. Exhibit C - CERTIFICATE OF ACCEPTANCE Type in source of funds Sign and print name and title

5. Exhibit D - LESSEE RESOLUTION Type in the date of the meeting in which the purchase was approved. Print or type the name and title of the individual(s) who is authorized to execute the Agreement The secretary, chairman or other authorized board member of the Lessee must sign the

resolution where indicated. A third individual must attest the Resolution where indicated.

6. OPINION OF COUNSEL Request that your legal counsel complete the opinion of counsel section by retyping the example given

on his/her letterhead with their signature. Legal counsel shall not alter the opinion. If counsel would like changes made to the opinion, he/she

must first contact Exchange National Bank & Trust. 7. BANK QUALIFIED CERTIFICATE

Sign and print name and title

II. 8038 - IRS Form Lessee should complete and file the form according to the attached instructions sheet.

III. CERTIFICATE OF INSURANCE See attached Insurance Requirements Form

IV. ADDITIONAL DOCUMENTATION THAT MUST BE SENT TO Exchange National Bank & Trust:

Vendor invoice Copy of title/MSO listing Exchange National Bank & Trust as 1st lienholder First payment check

All documentation should be returned to: Exchange National Bank & Trust

PO Box 249, 423 Main Street Effingham, Kansas 66023

KS Schools Standard 102407 

LEASE WITH OPTION TO PURCHASE AGREEMENT  Lessee:                 Lessor: USD #377, Atchison County Community School District      Exchange National Bank & Trust PO Box 289, 306 Main Street            PO Box 249, 423 Main Street Effingham, Kansas 66023            Effingham, Kansas 66023  Dated as of July 29, 2013  This Lease With Option to Purchase Agreement dated as of the date listed above is between Lessor and Lessee listed directly above. Lessor desires to finance the purchase of the Equipment described in Exhibit "A" to Lessee and Lessee desires to finance the purchase of the Equipment from Lessor subject to the terms and conditions of this Agreement which are set forth below. I. Definitions: Section 1.01. Definitions. The following terms will have the meanings indicated below unless the context clearly requires otherwise: “Additional Schedule” refers to the proper execution of additional Schedules to Exhibit A, Exhibit B, Exhibit C and Exhibit D as well as other exhibits or documents that may be required by the Lessor all of which relate to a lease of additional Equipment. "Agreement" means this Lease with Option to Purchase Agreement and all Exhibits attached hereto. "Budget Year" means the Lessee's fiscal year. "Commencement Date" is the date when Lessee's obligation to pay rent begins. "Equipment" means all of the items of Equipment listed on Exhibit "A" and all replacements, restorations, modifications and improvements. "Lessee" means the entity listed above as Lessee and which is leasing the Equipment from Lessor under the provisions of this Agreement. "Lessor" means the entity originally listed above as Lessor or any of its assignees. "Lease Term" means the Original Term and all Renewal Terms. "Original Term" means the period from the Commencement Date until the end of the Budget Year of Lessee. "Renewal Term" means the annual term which begins at the end of the Original Term and which is simultaneous with Lessee's Budget Year. "Rental Payments" means the payments Lessee is required to make under this Agreement as set forth on Exhibit "B". "State" means the state in which Lessee is located. II. Lessee Warranties Section 2.01. Lessee represents, warrants and covenants as follows for the benefit of Lessor or its assignees: (a) Lessee is an "issuer of tax exempt obligations" because Lessee is the State or a political subdivision of the State within the meaning of Section 103(a) of the Internal

Revenue Code of 1986, as amended, (the "Code") or because Lessee is a constituted authority or district authorized to issue obligations on behalf of the State or political subdivision of the State within the meaning of Treasury Regulation 1.103-1(b).

(b) Lessee is authorized under the Constitution and laws of the State to enter into this Agreement, and has used such authority to properly execute and deliver this Agreement. Lessee has followed all proper procedures of its governing body in executing this Agreement. The Officer of Lessee executing this Agreement has the authority to execute and deliver this Agreement. This Agreement constitutes a legal, valid, binding and enforceable obligation of the Lessee in accordance with its terms.

(c) Lessee has complied with all statutory laws and regulations that may be applicable to the execution of this Agreement. (d) Lessee shall use the Equipment only for essential, traditional government purposes. (e) Should the IRS disallow the tax-exempt status of the Interest Portion of the Rental Payments as a result of the failure of the Lessee to use the Equipment for

governmental purposes, then Lessee shall be required to pay additional sums to the Lessor or its assignees so as to bring the after tax yield to the same level as the Lessor or its assignees would attain if the transaction continued to be tax-exempt.

(f) Should the Lessee cease to be an issuer of tax exempt obligations or if the obligation of Lessee created under this Agreement ceases to be a tax exempt obligation for any reason, then Lessee shall be required to pay additional sums to the Lessor or its assignees so as to bring the after tax yield on this Agreement to the same level as the Lessor or its assignees would attain if the transaction continued to be tax-exempt.

(g) Lessee has never non-appropriated funds under an Agreement similar to this Agreement. (h) Lessee will submit to the Secretary of the Treasury an information reporting statement as required by the Code. (i) Upon request by Lessor, Lessee will provide Lessor with current financial statements, reports, budgets or other relevant fiscal information. (j) Lessee shall retain the Equipment free of any hazardous substances as defined in the Comprehensive Environmental Response, Compensation and Liability Act, 42

U.S.C. 9601 et. seq. as amended and supplemented. (k) Lessee presently intends to continue this Agreement for the Original Term and all Renewal Terms as set forth on Exhibit “B” hereto. The official of Lessee responsible for

budget preparation will include in the budget request for each Budget Year the Rental Payments to become due in such Budget year, and will use all reasonable and lawful means available to secure the appropriation of money for such Budget Year sufficient to pay the Rental Payments coming due therein. Lessee reasonably believes that moneys can and will lawfully be appropriated and made available for this purpose.

Section 2.02. Escrow Agreement. In the event both Lessor and Lessee mutually agree to utilize an Escrow Account, then immediately following the execution and delivery of this Agreement, Lessor and Lessee agree to execute and deliver and to cause Escrow Agent to execute and deliver the Escrow Agreement. This Agreement shall take effect only upon execution and delivery of the Escrow Agreement by the parties thereto. Lessor shall deposit or cause to be deposited with the Escrow agent for credit to the Equipment Acquisition Fund the sum of $N/A, which shall be held, invested and disbursed in accordance with the Escrow Agreement. III. Acquisition of Equipment, Rental Payments and the Purchase Option Price Section 3.01. Acquisition and Acceptance. Lessee shall be solely responsible for the ordering of the Equipment and for the delivery and installation of the Equipment. Execution of the Acceptance Certificate by an employee, official or agent of the Lessee having managerial, supervisory or procurement authority with respect to the Equipment shall constitute acceptance of the Equipment on behalf of the Lessee. Section 3.02. Rental Payments. Lessee shall pay Rental Payments exclusively to Lessor or its assignees in lawful, legally available money of the United States of America. The Rental Payments shall be sent to the location specified by the Lessor or its assignees. The Rental Payments shall constitute a current expense of the Lessee and shall not constitute an indebtedness of the Lessee. The Rental Payments are due as set forth on Exhibit B. Lessor shall have the option to charge interest at the highest lawful rate on any Rental Payment received later than the due date, plus any additional accrual on the outstanding balance for the number of days that the Rental Payments were late. The Rental Payments will be payable without notice or demand. Section 3.03. Rental Payments Unconditional. Except as provided under Section 4.01, THE OBLIGATIONS OF LESSEE TO MAKE RENTAL PAYMENTS AND TO PERFORM AND OBSERVE THE OTHER COVENANTS CONTAINED IN THIS AGREEMENT SHALL BE ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS WITHOUT ABATEMENT, DIMINUTION, DEDUCTION, SET-OFF OR DEFENSE. Section 3.04. Purchase Option Price. Upon thirty (30) days written notice, Lessee shall have the option to pay, in addition to the Rental Payment, the corresponding Purchase Option Price which is listed on the same line on Exhibit B. This option is only available to the Lessee on the Rental Payment date and no partial prepayments are allowed. If Lessee chooses this option and pays the Purchase Option Price to Lessor then Lessor will transfer any and all of its rights, title and interest in the Equipment to Lessee. Section 3.05. Lease Term. The Lease Term of the Agreement shall be the Original Term and all Renewal Terms until all the Rental Payments are paid as set forth on Exhibit B except as provided under Section 4.01 and Section 9.01 below. If, after the end of the budgeting process which occurs at the end of the Original Term or any Renewal Term, Lessee has not non-appropriated as provided for in this Agreement then the Lease Term shall be extended into the next Renewal Term and the Lessee shall be obligated to make all the Rental Payments that come due during such Renewal Term. Section 3.06. Disclaimer of Warranties. LESSOR MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, AS TO THE VALUE, DESIGN, CONDITION, MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE OR ANY OTHER WARRANTY WITH RESPECT TO THE EQUIPMENT. LESSOR SHALL NOT BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGE ARISING OUT OF THE INSTALLATION, OPERATION, POSSESSION, STORAGE OR USE OF THE EQUIPMENT BY LESSEE.

IV. Non-Appropriation Section 4.01. Non-Appropriation. Lessee is obligated to pay periodic payments as set forth on Exhibit B under the Agreement as may lawfully be made from funds budgeted and appropriated for that purpose during Lessees current Budget Year or from funds made available from any lawfully operated revenue producing source. If insufficient funds are available in Lessee's budget for the next Budget Year to make the Rental Payments for the next Renewal Term and the funds to make such Rental Payments are otherwise unavailable by any lawful means whatsoever, then Lessee shall have the option to non-appropriate the funds to pay the Rental Payments for the next Renewal Term. Lack of a sufficient appropriation shall be evidenced by the passage of an ordinance or resolution by the governing body of Lessee specifically prohibiting Lessee from performing its obligations under this Agreement and from using any moneys to pay the Rental Payments due under this Agreement for a designated Budget Year and all subsequent Budget Years. If Lessee chooses this option, then all obligations of the Lessee under this Agreement regarding Rental Payments for all remaining Renewal Terms shall be terminated at the end of the then current Original Term or Renewal Term without penalty or liability to the Lessee of any kind provided that if Lessee has not delivered possession of the Equipment to Lessor as provided herein and conveyed to Lessor or released its interest in the Equipment by the end of the last Budget Year for which Rental Payments were paid, the termination shall nevertheless be effective but Lessee shall be responsible for the payment of damages in an amount equal to the amount of the Rental Payments thereafter coming due under Exhibit “B” which are attributable to the number of days after such Budget Year during which Lessee fails to take such actions and for any other loss suffered by Lessor as a result of Lessee’s failure to take such actions as required. Lessee shall immediately notify the Lessor as soon as the decision to non-appropriate is made. If such non-appropriation occurs, then Lessee shall deliver the Equipment to Lessor as provided below in Section 9.04. Lessee shall be liable for all damage to the Equipment other than normal wear and tear. If Lessee fails to deliver the Equipment to Lessor, then Lessor may enter the premises where the Equipment is located and take possession of the Equipment and charge Lessee for costs incurred. V. Insurance, Damage, Insufficiency of Proceeds Section 5.01. Insurance. Lessee shall maintain both casualty insurance and liability insurance at its own expense with respect to the Equipment. Lessee shall be solely responsible for selecting the insurer(s) and for making all premium payments and ensuring that all policies are continuously kept in effect during the period when Lessee is required to make Rental Payments. Lessee shall provide Lessor with a Certificate of Insurance which lists the Lessor and/or assigns as a loss payee and an additional insured on the policies with respect to the Equipment. (a) Lessee shall insure the Equipment against any loss or damage by fire and all other risks covered by the standard extended coverage endorsement then in use in the

State and any other risks reasonably required by Lessor in an amount at least equal to the then applicable Purchase Option Price of the Equipment. Alternatively, Lessee may insure the Equipment under a blanket insurance policy or policies.

(b) The liability insurance shall insure Lessor from liability and property damage in any form and amount satisfactory to Lessor. (c) Lessee may self-insure against the casualty risks and liability risks described above. If Lessee chooses this option, Lessee must furnish Lessor with a certificate

and/or other documents which evidences such coverage. (d) All insurance policies issued or affected by this Section shall be so written or endorsed such that the Lessor and its assignees are named additional insureds and

loss payees and that all losses are payable to Lessee and Lessor or its assignees as their interests may appear. Each policy issued or affected by this Section shall contain a provision that the insurance company shall not cancel or materially modify the policy without first giving thirty (30) days advance notice to Lessor or its assignees. Lessee shall furnish to Lessor certificates evidencing such coverage throughout the Lease Term.

Section 5.02. Damage to or Destruction of Equipment. Lessee assumes the risk of loss or damage to the Equipment. If the Equipment or any portion thereof is lost, stolen, damaged, or destroyed by fire or other casualty, Lessee will immediately report all such losses to all possible insurers and take the proper procedures to attain all insurance proceeds. At the option of Lessor, Lessee shall either (1) apply the Net Proceeds to replace, repair or restore the Equipment or (2) apply the Net Proceeds to the applicable Purchase Option Price. For purposes of this Section and Section 5.03, the term Net Proceeds shall mean the amount of insurance proceeds collected from all applicable insurance policies after deducting all expenses incurred in the collection thereof. Section 5.03. Insufficiency of Net Proceeds. If there are no Net Proceeds for whatever reason or if the Net Proceeds are insufficient to pay in full the cost of any replacement, repair, restoration, modification or improvement of the Equipment, then Lessee shall, at the option of Lessor, either (1) complete such replacement, repair, restoration, modification or improvement and pay any costs thereof in excess of the amount of the Net Proceeds or (2) apply the Net Proceeds to the Purchase Option Price and pay the deficiency, if any, to the Lessor. Section 5.04. Lessee Negligence. Lessee assumes all risks and liabilities, whether or not covered by insurance, for loss or damage to the Equipment and for injury to or death of any person or damage to any property whether such injury or death be with respect to agents or employees of Lessee or of third parties, and whether such property damage be to Lessee’s property or the property of others (including, without limitation, liabilities for loss or damage related to the release or threatened release of hazardous substances under the Comprehensive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act or similar or successor law or any state or local equivalent now existing or hereinafter enacted which in any manner arise out of or are incident to any possession, use, operation, condition or storage of any Equipment by Lessee) which is proximately caused by the negligent conduct of Lessee, its officers, employees and agents. Lessee hereby assumes responsibility for and agrees to reimburse Lessor for all liabilities, obligations, losses, damages, penalties, claims, actions, costs and expenses (including reasonable attorneys’ fees) of whatsoever kind and nature, imposed on, incurred by or asserted against Lessor that in any way relate to or arise out of a claim, suit or proceeding, based in whole or in part upon the negligent conduct of Lessee, its officers, employees and agents, to the maximum extent permitted by law. VI. Title and Security Interest Section 6.01. Title. Title to the Equipment shall vest in Lessee when Lessee acquires and accepts the Equipment. Title to the Equipment will automatically transfer to the Lessor in the event Lessee non-appropriates under Section 4.01 or in the event Lessee defaults under Section 9.01. In either of such events, Lessee shall execute and deliver to Lessor such documents as Lessor may request to evidence the passage of legal title to the Equipment to Lessor. Section 6.02. Security Interest. To secure the payment of all Lessee's obligations under this Agreement, Lessee hereby grants to Lessor a security interest under the Uniform Commercial Code constituting a first lien on the Equipment described more fully on Exhibit "A". The security interest established by this section includes not only all additions, attachments, repairs and replacements to the Equipment but also all proceeds therefrom. Lessee authorizes Lessor to prepare and record any Financing Statement required under the Uniform Commercial Code to perfect the Security Interest created hereunder. VII. Assignment Section 7.01. Assignment by Lessor. All of Lessor's rights, title and/or interest in and to this Agreement may be assigned and reassigned in whole or in part to one or more assignees or sub-assignees (including a Registered Owner for Lease Participation Certificates) by Lessor at any time without the consent of Lessee. No such assignment shall be effective as against Lessee until the assignor shall have filed with Lessee written notice of assignment identifying the assignee. Lessee shall pay all Rental Payments due hereunder relating to such Equipment to or at the direction of Lessor or the assignee named in the notice of assignment. Lessee shall keep a complete and accurate record of all such assignments. Section 7.02. Assignment by Lessee. None of Lessee's right, title and interest under this Agreement and in the Equipment may be assigned by Lessee unless Lessor approves of such assignment in writing before such assignment occurs and only after Lessee first obtains an opinion from nationally recognized counsel stating that such assignment will not jeopardize the tax-exempt status of the obligation. VIII. Maintenance of Equipment Section 8.01. Lessee shall keep the Equipment in good repair and working order. Lessor shall have no obligation to inspect, test, service, maintain, repair or make improvements or additions to the Equipment under any circumstances. Lessee will be liable for all damage to the Equipment, other than normal wear and tear, caused by Lessee, its employees or its agents. Lessee shall pay for and obtain all permits, licenses and taxes necessary for the installation, operation, possession, storage or use of the Equipment. If the Equipment includes any titled vehicle(s), then Lessee is responsible for obtaining such title(s) from the State and also for ensuring that Lessor is listed as First Lienholder on all of the title(s). Lessee shall not use the Equipment to haul, convey or transport hazardous waste as defined in the Resource Conservation and Recovery Act, 42 U.S.C. 6901 et. seq. Lessee shall not during the term of this Agreement create, incur or assume any levies, liens or encumbrances of any kind with respect to the Equipment except those created by this Agreement. Lessee agrees that Lessor or its Assignee may execute additional documents including financing statements, affidavits, notices, and similar instruments, for and on behalf of Lessee which Lessor deems necessary or appropriate to protect Lessor’s interest in the Equipment and in this Agreement. The Equipment is and shall at all times be and remain personal property. Lessee shall allow Lessor to examine and inspect the Equipment at all reasonable times. IX. Default Section 9.01. Events of Default defined. The following events shall constitute an "Event of Default" under this Agreement: (a) Failure by Lessee to pay any Rental Payment listed on Exhibit "B" for fifteen (15) days after such payment is due according to the Payment Date listed on Exhibit

"B". (b) Failure to pay any other payment required to be paid under this Agreement at the time specified herein and a continuation of said failure for a period of fifteen (15)

days after written notice by Lessor that such payment must be made. If Lessee continues to fail to pay any payment after such period, then Lessor may, but will not be obligated to, make such payments and charge Lessee for all costs incurred plus interest at the highest lawful rate.

(c) Failure by Lessee to observe and perform any warranty, covenant, condition, promise or duty under this Agreement for a period of thirty (30) days after written notice specifying such failure is given to Lessee by Lessor, unless Lessor agrees in writing to an extension of time. Lessor will not unreasonably withhold its consent to an extension of time if corrective action is instituted by Lessee. Subsection (c) does not apply to Rental Payments and other payments discussed above.

(d) Any statement, material omission, representation or warranty made by Lessee in or pursuant to this Agreement which proves to be false, incorrect or misleading on the date when made regardless of Lessee's intent and which materially adversely affects the rights or security of Lessor under this Agreement.

(e) Any provision of this Agreement which ceases to be valid for whatever reason and the loss of such provision would materially adversely affect the rights or security of Lessor.

(f) Lessee admits in writing its inability to pay its obligations. Lessee defaults on one or more of its other obligations. Lessee applies or consents to the appointment of a receiver or a custodian to manage its affairs. Lessee makes a general assignment for the benefit of creditors.

Section 9.02. Remedies on Default. Whenever any Event of Default exists, Lessor shall have the right to take one or any combination of the following remedial steps: (a) With or without terminating this Agreement, Lessor may declare all Rental Payments and other amounts payable by Lessee hereunder to the end of the then current

Budget Year to be immediately due and payable. (b) With or without terminating this Agreement, Lessor may require Lessee at Lessee's expense to redeliver any or all of the Equipment to Lessor as provided below in

Section 9.04. Such delivery shall take place within fifteen (15) days after the event of default occurs. If Lessee fails to deliver the Equipment, Lessor may enter the premises where the Equipment is located and take possession of the Equipment and charge Lessee for cost incurred. Notwithstanding that Lessor has taken possession of the Equipment, Lessee shall still be obligated to pay the remaining Rental Payments due up until the end of the then current Original Term or Renewal Term. Lessee will be liable for any damage to the Equipment caused by Lessee or its employees or agents.

(c) Lessor may take whatever action at law or in equity that may appear necessary or desirable to enforce its rights. Lessee shall be responsible to Lessor for all costs incurred by Lessor in the enforcement of its rights under this Agreement including, but not limited to, reasonable attorney fees.

Section 9.03. No Remedy Exclusive. No remedy herein conferred upon or reserved to 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 Agreement 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 shall be construed to be a waiver thereof. Section 9.04. Return of Equipment and Storage. (a) Surrender: The Lessee shall, at its own expense, surrender the Equipment to the Lessor in the event of a default or a non-appropriation by delivering the Equipment

to the Lessor to a location accessible by common carrier and designated by Lessor. In the case that any of the Equipment consists of software, Lessee shall destroy all intangible items constituting such software and shall deliver to Lessor all tangible items constituting such software. At Lessors request, Lessee shall also certify in a form acceptable to Lessor that Lessee has complied with the above software return provisions and that they will immediately cease using the software and that they shall permit Lessor and/or the vendor of the software to inspect Lessee’s locations to verify compliance with the terms hereto.

(b) Delivery: The Equipment shall be delivered to the location designated by the Lessor by a common carrier unless the Lessor agrees in writing that a common carrier is not needed. When the Equipment is delivered into the custody of a common carrier, the Lessee shall arrange for the shipping of the item and its insurance in transit in accordance with the Lessor’s instructions and at the Lessee’s sole expense. Lessee at its expense shall completely sever and disconnect the Equipment or its component parts from the Lessee’s property all without liability to the Lessor. Lessee shall pack or crate the Equipment and all of the component parts of the Equipment carefully and in accordance with any recommendations of the manufacturer. The Lessee shall deliver to the Lessor the plans, specifications operation manuals or other warranties and documents furnished by the manufacturer or vendor on the Equipment and such other documents in the Lessee’s possession relating to the maintenance and methods of operation of such Equipment.

(c) Condition: When the Equipment is surrendered to the Lessor it shall be in the condition and repair required to be maintained under this Agreement. It will also meet all legal regulatory conditions necessary for the Lessor to sell or lease it to a third party and be free of all liens. If Lessor reasonably determines that the Equipment or an item of the Equipment, once it is returned, is not in the condition required hereby, Lessor may cause the repair, service, upgrade, modification or overhaul of the Equipment or an item of the Equipment to achieve such condition and upon demand, Lessee shall promptly reimburse Lessor for all amounts reasonably expended in connection with the foregoing.

(d) Storage: Upon written request by the Lessor, the Lessee shall provide free storage for the Equipment or any item of the Equipment for a period not to exceed 60 days after the expiration of its lease term before returning it to the Lessor. The Lessee shall arrange for the insurance described to continue in full force and effect with respect to such item during its storage period and the Lessor shall reimburse the Lessee on demand for the incremental premium cost of providing such insurance.

X. Miscellaneous Section 10.01. Notices. All notices shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, to the parties at their respective places of business as first set forth herein or as the parties shall designate hereafter in writing. Section 10.02. Binding Effect. This Agreement shall inure to the benefit of and shall be binding upon Lessee and Lessor and their respective successors and assigns. Section 10.03. Severability. In the event any provision of this Agreement shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof. Section 10.04. Amendments, Addenda, Changes or Modifications. This Agreement may be amended, added to, changed or modified by written agreement duly executed by Lessor and Lessee. Section 10.05. Execution in Counterparts. This Agreement may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 10.06. Captions. The captions or headings in this Agreement do not define, limit or describe the scope or intent of any provisions or sections of this Agreement. Section 10.07. Master Lease. This Agreement can be utilized as a Master Lease Agreement. This means that the Lessor and the Lessee may agree to the lease of additional Equipment under this Agreement at some point in the future by executing one or more Additional Schedules to Exhibit A, Exhibit B, Exhibit C and Exhibit D as well as other exhibits or documents that may be required by Lessor. Additional Schedules will be consecutively numbered on each of the exhibits which make up the Additional Schedule and all the terms and conditions of the Agreement shall govern each Additional Schedule. Section 10.08. Entire Writing. This Agreement constitutes the entire writing between Lessor and Lessee. No waiver, consent, modification or change of terms of this Agreement shall bind either party unless in writing and signed by both parties, and then such waiver, consent, modification or change shall be effective only in the specific instance and for the specific purpose given. There are no understandings, agreements, representations, conditions, or warranties, express or implied, which are not specified herein regarding this Agreement or the Equipment leased hereunder. Any terms and conditions of any purchase order or other documents submitted by Lessee in connection with this Agreement which are in addition to or inconsistent with the terms and conditions of this Agreement will not be binding on Lessor and will not apply to this Agreement. Section 10.09. Kansas Law. The amount or capital cost required to purchase the Equipment if the Lessee paid cash for the Equipment on the day the Agreement is booked is the amount listed on Exhibit B, plus any down payment made by the Lessee. The Annual average effective interest cost is also listed on Exhibit B. There are NO amounts included in the Rental Payments for services, maintenance, insurance or other charges. This Agreement shall be deemed executory only to the extent of the monies appropriated and available for the purpose of this Agreement, and no liability on account therefor shall be incurred by the Lessee beyond the amount of such monies. This Agreement is not a general obligation of the Lessee, neither the full faith and credit nor the taxing power of the Lessee are pledged to the payment of any amount due or to become due under this Agreement. It is understood that neither this Agreement nor any representation by any public employee or officer creates any legal or moral obligation to request, appropriate or make monies available for the purpose of this Agreement. Section 10.10. This Agreement is authorized by and subject to the provisions of K.S.A. 1991 Supp. 72-8225, and that the terms and conditions of said Agreement can be changed at any time by the legislature and also that the legislature at any time can abolish or terminate the Agreement. Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives listed below.

USD #377, ATCHISON COUNTY COMMUNITY SCHOOL    EXCHANGE NATIONAL BANK & TRUST DISTRICT                                 Signature              Signature                                 Typed Name and Title            Typed Name and Title 

State of Kansas Department of Administration DA-146a (Rev. 06-12)

CONTRACTUAL PROVISIONS ATTACHMENT Important: This form contains mandatory contract provisions and must be attached to or incorporated in all copies of any contractual agreement. If it

is attached to the vendor/contractor's standard contract form, then that form must be altered to contain the following provision: "The Provisions found in Contractual Provisions Attachment (Form DA-146a, Rev. 06-12), which is attached hereto, are hereby

incorporated in this contract and made a part thereof." The parties agree that the following provisions are hereby incorporated into the contract to which it is attached and made a part thereof,

said contract being the _____ day of ____________________, 20_____. 1. Terms Herein Controlling Provisions: It is expressly agreed that the terms of each and every provision in this attachment shall prevail and

control over the terms of any other conflicting provision in any other document relating to and a part of the contract in which this attachment is incorporated. Any terms that conflict or could be interpreted to conflict with this attachment are nullified.

2. Kansas Law and Venue: This contract shall be subject to, governed by, and construed according to the laws of the State of Kansas, and

jurisdiction and venue of any suit in connection with this contract shall reside only in courts located in the State of Kansas. 3. Termination Due To Lack Of Funding Appropriation: If, in the judgment of the Director of Accounts and Reports, Department of Administration,

sufficient funds are not appropriated to continue the function performed in this agreement and for the payment of the charges hereunder, State may terminate this agreement at the end of its current fiscal year. State agrees to give written notice of termination to contractor at least 30 days prior to the end of its current fiscal year, and shall give such notice for a greater period prior to the end of such fiscal year as may be provided in this contract, except that such notice shall not be required prior to 90 days before the end of such fiscal year. Contractor shall have the right, at the end of such fiscal year, to take possession of any equipment provided State under the contract. State will pay to the contractor all regular contractual payments incurred through the end of such fiscal year, plus contractual charges incidental to the return of any such equipment. Upon termination of the agreement by State, title to any such equipment shall revert to contractor at the end of the State's current fiscal year. The termination of the contract pursuant to this paragraph shall not cause any penalty to be charged to the agency or the contractor.

4. Disclaimer Of Liability: No provision of this contract will be given effect that attempts to require the State of Kansas or its agencies to defend,

hold harmless, or indemnify any contractor or third party for any acts or omissions. The liability of the State of Kansas is defined under the Kansas Tort Claims Act (K.S.A. 75-6101 et seq.).

5. Anti-Discrimination Clause: The contractor agrees: (a) to comply with the Kansas Act Against Discrimination (K.S.A. 44-1001 et seq.) and the

Kansas Age Discrimination in Employment Act (K.S.A. 44-1111 et seq.) and the applicable provisions of the Americans With Disabilities Act (42 U.S.C. 12101 et seq.) (ADA) and to not discriminate against any person because of race, religion, color, sex, disability, national origin or ancestry, or age in the admission or access to, or treatment or employment in, its programs or activities; (b) to include in all solicitations or advertisements for employees, the phrase "equal opportunity employer"; (c) to comply with the reporting requirements set out at K.S.A. 44-1031 and K.S.A. 44-1116; (d) to include those provisions in every subcontract or purchase order so that they are binding upon such subcontractor or vendor; (e) that a failure to comply with the reporting requirements of (c) above or if the contractor is found guilty of any violation of such acts by the Kansas Human Rights Commission, such violation shall constitute a breach of contract and the contract may be cancelled, terminated or suspended, in whole or in part, by the contracting state agency or the Kansas Department of Administration; (f) if it is determined that the contractor has violated applicable provisions of ADA, such violation shall constitute a breach of contract and the contract may be cancelled, terminated or suspended, in whole or in part, by the contracting state agency or the Kansas Department of Administration.

Contractor agrees to comply with all applicable state and federal anti-discrimination laws. The provisions of this paragraph number 5 (with the exception of those provisions relating to the ADA) are not applicable to a contractor who

employs fewer than four employees during the term of such contract or whose contracts with the contracting State agency cumulatively total $5,000 or less during the fiscal year of such agency.

6. Acceptance Of Contract: This contract shall not be considered accepted, approved or otherwise effective until the statutorily required approvals

and certifications have been given. 7. Arbitration, Damages, Warranties: Notwithstanding any language to the contrary, no interpretation of this contract shall find that the State or its

agencies have agreed to binding arbitration, or the payment of damages or penalties. Further, the State of Kansas and its agencies do not agree to pay attorney fees, costs, or late payment charges beyond those available under the Kansas Prompt Payment Act (K.S.A. 75-6403), and no provision will be given effect that attempts to exclude, modify, disclaim or otherwise attempt to limit any damages available to the State of Kansas or its agencies at law, including but not limited to the implied warranties of merchantability and fitness for a particular purpose.

8. Representative's Authority To Contract: By signing this contract, the representative of the contractor thereby represents that such person is duly

authorized by the contractor to execute this contract on behalf of the contractor and that the contractor agrees to be bound by the provisions thereof.

9. Responsibility For Taxes: The State of Kansas and its agencies shall not be responsible for, nor indemnify a contractor for, any federal, state or

local taxes which may be imposed or levied upon the subject matter of this contract. 10. Insurance: The State of Kansas and its agencies shall not be required to purchase any insurance against loss or damage to property or any other

subject matter relating to this contract, nor shall this contract require them to establish a "self-insurance" fund to protect against any such loss or damage. Subject to the provisions of the Kansas Tort Claims Act (K.S.A. 75-6101 et seq.), the contractor shall bear the risk of any loss or damage to any property in which the contractor holds title.

11. Information: No provision of this contract shall be construed as limiting the Legislative Division of Post Audit from having access to

information pursuant to K.S.A. 46-1101 et seq. 12. The Eleventh Amendment: "The Eleventh Amendment is an inherent and incumbent protection with the State of Kansas and need not be

reserved, but prudence requires the State to reiterate that nothing related to this contract shall be deemed a waiver of the Eleventh Amendment." 13. Campaign Contributions / Lobbying: Funds provided through a grant award or contract shall not be given or received in exchange for the

making of a campaign contribution. No part of the funds provided through this contract shall be used to influence or attempt to influence an officer or employee of any State of Kansas agency or a member of the Legislature regarding any pending legislation or the awarding, extension, continuation, renewal, amendment or modification of any government contract, grant, loan, or cooperative agreement.

Schedule (01) 

  

EXHIBIT A  

DESCRIPTION OF EQUIPMENT  RE:    Lease With Option  to Purchase Agreement dated as of  July 29, 2013, between Exchange National Bank & Trust (Lessor) and USD #377, Atchison County Community School District (Lessee) 

 Below is a detailed description of all the items of Equipment including quantity, model number and serial number where applicable:   

Four (4) 2014 International 60 Passenger School Buses  VIN: 4DRBUSKP7EB015024, 4DRBUSKP9EB015025, 4DRBUSKP0EB015026 & 4DRBUSKP2EB015027                                Location of Equipment:                          

Schedule (01)  

EXHIBIT B  

PAYMENT SCHEDULE  

RE:    Lease With Option  to Purchase Agreement dated as of  July 29, 2013, between Exchange National Bank & Trust (Lessor) and USD #377, Atchison County Community School District (Lessee) 

              

Date of First Payment:  At Closing Original Balance:  $278,208.00 Total Number of Payments:  Five (5) Number of Payments Per Year:  One (1) Interest Rate:  1.691% 

         Pmt  Due  Rental  Applied to  Applied to  *Purchase 

No.  Date  Payment  Interest  Principal  Option Price 

1  At Closing  $57,523.04  $0.00  $57,523.04  $220,684.96 

2  29‐Jul‐14  $57,523.04  $3,731.60  $53,791.44  $166,893.52 

3  29‐Jul‐15  $57,523.04  $2,822.03  $54,701.01  $112,192.51 

4  29‐Jul‐16  $57,523.04  $1,897.08  $55,625.96  $56,566.55 

5  29‐Jul‐17  $57,523.04  $956.49  $56,566.55  $1.00 

  USD #377, Atchison County Community School District                    Signature                   Typed Name and Title  *Assumes all Rental Payments due to date are paid 

Schedule (01)  

EXHIBIT C  

CERTIFICATE OF ACCEPTANCE  RE:    Lease With Option  to Purchase Agreement dated as of  July 29, 2013, between Exchange National Bank & Trust (Lessor) and USD #377, Atchison County Community School District (Lessee) 

 I,  the  undersigned,  hereby  certify  that  I  am  a  duly  qualified  representative  of  Lessee  and  that  I  have  been  given  the authority by  the Governing Body of Lessee  to  sign  this Certificate of Acceptance with  respect  to  the above  referenced Agreement.  I hereby certify that:  1. The Equipment described on Exhibit A has been delivered and installed in accordance with Lessee's specifications. 2. Lessee has conducted such inspection and/or testing of the Equipment as it deems necessary and appropriate and 

hereby acknowledges that it accepts the Equipment for all purposes.  3. Lessee  has  appropriated  and/or  taken  other  lawful  actions  necessary  to  provide moneys  sufficient  to  pay  all 

Rental Payments  required  to be paid under  the Agreement during  the current Budget Year of Lessee, and such moneys will be applied in payment of all Rental Payments due and payable during such current Budget Year. 

4. Lessee has obtained insurance coverage as required under the Agreement from an insurer qualified to do business in the State. 

5. No event or condition that constitutes or would constitute an Event of Default exists as of the date hereof. 6. The governing body of Lessee has approved  the authorization, execution and delivery of  this Agreement on  its 

behalf by the authorized representative of Lessee who signed the Agreement. 7. Please  list the Source of Funds (Fund Item  in Budget) for the Rental Payments that come due under Exhibit B of 

this Agreement.                             

If the above Source of Funds is solely a grant type fund, then the Lessee, by signing below, hereby authorizes the General Fund of the Lessee as a backup source of funds from which the Rental Payments can be made. 

  USD #377, Atchison County Community School District                     Signature                   

Typed Name and Title 

Schedule (01) 

EXHIBIT D  

LESSEE RESOLUTION  RE:    Lease With Option  to Purchase Agreement dated as of  July 29, 2013, between Exchange National Bank & Trust (Lessor) and USD #377, Atchison County Community School District (Lessee) 

 

At  a  duly  called  meeting  of  the  Governing  Body  of  the  Lessee  (as  defined  in  the  Agreement)  held  on 

____________________________ the following resolution was introduced and adopted: 

 

BE IT RESOLVED by the Governing Body of Lessee as follows:  

 

1.  Determination of Need.  The Governing Body of Lessee has determined that a true and very real need exists for the 

acquisition of the Equipment described on Exhibit A of the Lease With Option to Purchase Agreement dated as of July 

29, 2013, between USD #377, Atchison County Community  School District  (Lessee) and Exchange National Bank & 

Trust (Lessor). 

 

2.  Approval and Authorization. The Governing Body of Lessee has determined that the Agreement, substantially in the 

form presented to this meeting,  is  in the best  interests of the Lessee for the acquisition of such Equipment, and the 

Governing  Body  hereby  approves  the  entering  into  of  the  Agreement  by  the  Lessee  and  hereby  designates  and 

authorizes the following person(s) to execute and deliver the Agreement on Lessee’s behalf with such changes thereto 

as such person(s) deem(s) appropriate, and any related documents, including any Escrow Agreement, necessary to the 

consummation of the transaction contemplated by the Agreement. 

 

Authorized Individual(s):                     

                                         (Printed or Typed Name and Title of individual(s) authorized to execute the Agreement)  

 

3.  Adoption of Resolution.  The signatures below from the designated individuals from the Governing Body of the Lessee 

evidence the adoption by the Governing Body of this Resolution.  

 

 

 

Signature:                         

      (Signature of Secretary, Board Chairman or other member of the Governing Body) 

 

Typed Name & Title                       

                        (Typed Name and Title of individual who signed directly above)  

 

 

Attested By:                         

                     (Signature of one additional person who can witness the passage of this Resolution) 

 

Typed Name & Title:                       

                      (Typed name of individual who signed directly above) 

 

OPINION OF COUNSEL  

(Must be Re‐typed onto attorney's letterhead) 

 

(Date, must be on or after the meeting date listed on Exhibit D, Lessee Resolution) 

 

 

Exchange National Bank & Trust 

PO Box 249, 423 Main Street 

Effingham, Kansas 66023 

 RE:    Lease With Option  to Purchase Agreement dated as of  July 29, 2013, between Exchange National Bank & Trust (Lessor) and USD #377, Atchison County Community School District (Lessee) 

 

Ladies & Gentlemen: 

 

As legal counsel to Lessee, I have examined the foregoing Agreement and such other opinions, documents and matters of 

law  as  I  have  deemed  necessary  in  connection with  this  Agreement.    Based  on  the  foregoing,  I  am  of  the  following 

opinions: 

 

1. Lessee  is  a  duly  organized  political  subdivision  of  the  State within  the meaning  of  Section  103(a)  of  the  Internal 

Revenue  Lessee  is  a  political  subdivision  of  the  State  of  Kansas,  or  a  constituted  authority  authorized  to  issue 

obligations on behalf of a political subdivision of the State. 

2. Lessee has the requisite power and authority to purchase the Equipment and to execute and deliver the Agreement 

and to perform its obligations under the Agreement. The Agreement and the other documents either attached hereto 

or required herein have been duly authorized, approved and executed by and on behalf of Lessee, and the Agreement 

is a legal, valid and binding obligation of Lessee enforceable in accordance with its terms. 

3. The  authorization,  approval  and  execution  of  the  Agreement  and  all  other  proceedings  of  Lessee  relating  to  the 

transactions contemplated  thereby have been performed  in accordance with all open meeting  laws, public bidding 

laws and all other applicable state and federal laws. 

4. There  is no  litigation,  action,  suit or proceeding pending or before  any  court,  administrative  agency,  arbitrator or 

governmental body that challenges the authority of the Lessee or any of the Lessee’s officers or employees to enter 

into the Agreements. 

5. The above opinion is for the sole benefit of the Lessor listed above and can only be relied upon by the Lessor or any 

permitted assignee or subassignee of Lessor under the agreement.  

                     Signature of Legal Counsel 

Schedule (01)  

BANK QUALIFIED CERTIFICATE   RE:    Lease With Option  to Purchase Agreement dated as of  July 29, 2013, between Exchange National Bank & Trust (Lessor) and USD #377, Atchison County Community School District (Lessee) 

 

Whereas, Lessee hereby represents that  it  is a “Bank Qualified”  Issuer  for the calendar year  in which this Agreement  is 

executed  by making  the  following  designations with  respect  to  Section  265  of  the  Internal  Revenue  Code.    (A  “Bank 

Qualified  Issuer”  is an  issuer that  issues  less than ten million ($10,000,000) dollars of tax‐exempt obligations during the 

calendar year). 

 

Now, therefor, Lessee hereby designates this Agreement as follows: 

 

1. Designation as Qualified Tax‐Exempt Obligation.  Pursuant to Section 265(b)(3)(B)(i) of the Internal Revenue Code of 

1986 as amended  (the “Code”), the Lessee hereby specifically designates the Agreement as a “qualified tax‐exempt 

obligation” for purposes of Section 265(b)(3) of the Code.    In compliance with Section 265(b)(3)(D) of the Code, the 

Lessee  hereby  represents  that  the  Lessee will  not  designate more  than  $10,000,000  of  obligations  issued  by  the 

Lessee  in  the  calendar  year during which  the Agreement  is  executed  and delivered  as  such  “qualified  tax‐exempt 

obligations”. 

 

2. Issuance  Limitation.    In  compliance with  the  requirements of  Section 265(b)(3)(C) of  the Code,  the  Lessee hereby 

represents that the Lessee (including all subordinate entities of the Lessee within the meaning of Section 265(b)(3)(E) 

of  the Code)  reasonably anticipates not  to  issue  in  the calendar year during which  the Agreement  is executed and 

delivered, obligations bearing  interest exempt  from  federal  income  taxation under Section 103 of  the Code  (other 

than “private activity bonds” as defined in Section 141 of the Code) in an amount greater than $10,000,000. 

 

 USD #377, Atchison County Community School District                     Signature                   

Typed Name and Title 

INSURANCE REQUIREMENTS  Pursuant  to  Article  V  in  the  Lease With Option  to  Purchase  Agreement,  you  have  agreed  to  provide  us  evidence  of insurance covering  the property  in  the Agreement.   A Certificate of  Insurance naming all  insured parties and coverages must be determined to us as soon as possible, but no later than the date on which delivery of equipment occurs.  If you have not  taken possession of  the equipment, please write a memo  to Exchange National Bank & Trust  stating your carrier, insurance agent and telephone number to reach them upon delivery.  In the case of self‐insurance, the amounts of  liability and physical damage coverage are to be  listed on some form of certificate supplied by you.  In addition, information regarding the nature of your self‐insurance program should also be forwarded to us as soon as possible. 

 INSURANCE REQUIREMENTS:  1.  LIABILITY                           

Minimum of $500,000.00 combined single‐limit on bodily injury and property damage.  Exchange National Bank & Trust MUST be listed as additional insured and loss payee. 

 2.  PHYSICAL DAMAGE                         

All risk coverage to guarantee proceeds sufficient to pay the applicable Purchase Option Price as set forth  in Exhibit B of  the Agreement.   Exchange National Bank & Trust MUST be  listed as additional  insured and  loss payee. 

 3.  ENDORSEMENT                          

Lessor will  receive  at  least  thirty  (30)  days written  notice  from  Insurer  prior  to  alteration,  cancellation  or reduction of insurance coverage. 

 PLEASE FAX THE CERTIFICATE TO US AS SOON AS POSSIBLE AT (913) 833‐5452, AND MAIL THE ORIGINAL TO:    Exchange National Bank & Trust 

PO Box 249, 423 Main Street Effingham, Kansas 66023 

 YOUR ASSISTANCE IS GREATLY APPRECIATED TO COMPLETE THIS TRANSACTION, IF YOU HAVE ANY QUESTIONS, PLEASE GIVE US A CALL AT (913) 833‐5560. 

 

USD #377, Atchison County Community School District  Insurance Company:                            Agent’s Name:                             Telephone #:                              Fax #:                                Address, City, State & Zip:                         

Exchange National Bank & Trust PO Box 249, 423 Main Street Effingham, Kansas 66023   

   

DATE: July 29, 2013 

 

To:  Re:

USD #377, Atchison County Community School District Financing for Four (4) 2014 International 60 Passenger School Buses PO Box 289, 306 Main Street 

Effingham, Kansas 66023        

  DESCRIPTION    AMOUNT 

First Rental Payment due at closing of contract to finance.  $57,523.04 

 

   

   

   

   

   

   

SUBTOTAL  $57,523.04 

SALES TAX   

SHIPPING & HANDLING   

TOTAL DUE  $57,523.04 

 

 Make all checks payable to: Exchange National Bank & Trust  If you have any questions concerning this invoice, call us at (913) 833‐5560.

Form 8038-G(Rev. September 2011)

Department of the Treasury Internal Revenue Service

Information Return for Tax-Exempt Governmental Obligations▶ Under Internal Revenue Code section 149(e)

▶ See separate instructions. Caution: If the issue price is under $100,000, use Form 8038-GC.

OMB No. 1545-0720

Part I Reporting Authority If Amended Return, check here ▶1 Issuer’s name 2 Issuer’s employer identification number (EIN)

3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instructions) 3b Telephone number of other person shown on 3a

4 Number and street (or P.O. box if mail is not delivered to street address) Room/suite 5 Report number (For IRS Use Only)

3 6 City, town, or post office, state, and ZIP code 7 Date of issue

8 Name of issue 9 CUSIP number

10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see instructions)

10b Telephone number of officer or other employee shown on 10a

Part II Type of Issue (enter the issue price). See the instructions and attach schedule.11 Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 12 Health and hospital . . . . . . . . . . . . . . . . . . . . . . . . . . 12 13 Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 14 Public safety . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 15 Environment (including sewage bonds) . . . . . . . . . . . . . . . . . . . . 15 16 Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 17 Utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18 Other. Describe ▶ 18 19 If obligations are TANs or RANs, check only box 19a . . . . . . . . . . . . . ▶

If obligations are BANs, check only box 19b . . . . . . . . . . . . . . . . ▶

20 If obligations are in the form of a lease or installment sale, check box . . . . . . . . ▶

Part III Description of Obligations. Complete for the entire issue for which this form is being filed.

21

(a) Final maturity date (b) Issue price(c) Stated redemption

price at maturity(d) Weighted

average maturity(e) Yield

$ $ years % Part IV Uses of Proceeds of Bond Issue (including underwriters’ discount)22 Proceeds used for accrued interest . . . . . . . . . . . . . . . . . . . . . 22 23 Issue price of entire issue (enter amount from line 21, column (b)) . . . . . . . . . . . 23 24 Proceeds used for bond issuance costs (including underwriters’ discount) . . 24 25 Proceeds used for credit enhancement . . . . . . . . . . . . 25 26 Proceeds allocated to reasonably required reserve or replacement fund . 26 27 Proceeds used to currently refund prior issues . . . . . . . . . 27 28 Proceeds used to advance refund prior issues . . . . . . . . . 28 29 Total (add lines 24 through 28) . . . . . . . . . . . . . . . . . . . . . . . 29 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) . . . 30 Part V Description of Refunded Bonds. Complete this part only for refunding bonds.31 Enter the remaining weighted average maturity of the bonds to be currently refunded . . . . ▶ years32 Enter the remaining weighted average maturity of the bonds to be advance refunded . . . . ▶ years33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) . . . . . . ▶

34 Enter the date(s) the refunded bonds were issued ▶ (MM/DD/YYYY)

For Paperwork Reduction Act Notice, see separate instructions. Cat. No. 63773S Form 8038-G (Rev. 9-2011)

Form 8038-G (Rev. 9-2011) Page 2 Part VI Miscellaneous35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) . . . . 35

36 a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIC) (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . 36a

b Enter the final maturity date of the GIC ▶

c Enter the name of the GIC provider ▶37 Pooled financings: Enter the amount of the proceeds of this issue that are to be used to make loans

to other governmental units . . . . . . . . . . . . . . . . . . . . . . . . 37 38 a If this issue is a loan made from the proceeds of another tax-exempt issue, check box ▶ and enter the following information:

b Enter the date of the master pool obligation ▶

c Enter the EIN of the issuer of the master pool obligation ▶

d Enter the name of the issuer of the master pool obligation ▶

39 If the issuer has designated the issue under section 265(b)(3)(B)(i)(III) (small issuer exception), check box . . . . ▶

40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . . . . . . . . . . ▶

41 a If the issuer has identified a hedge, check here ▶ and enter the following information:b Name of hedge provider ▶c Type of hedge ▶d Term of hedge ▶

42 If the issuer has superintegrated the hedge, check box . . . . . . . . . . . . . . . . . . . . . ▶

43 If the issuer has established written procedures to ensure that all nonqualified bonds of this issue are remediated according to the requirements under the Code and Regulations (see instructions), check box . . . . . . . . ▶

44 If the issuer has established written procedures to monitor the requirements of section 148, check box . . . . . ▶

45a If some portion of the proceeds was used to reimburse expenditures, check here ▶ and enter the amountof reimbursement . . . . . . . . . ▶

b Enter the date the official intent was adopted ▶

Signature and Consent

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. I further declare that I consent to the IRS’s disclosure of the issuer’s return information, as necessary to process this return, to the person that I have authorized above.

▲

Signature of issuer’s authorized representative Date

▲

Type or print name and title

Paid Preparer Use Only

Print/Type preparer’s name Preparer's signature DateCheck if self-employed

PTIN

Firm’s name ▶

Firm's address ▶

Firm's EIN ▶

Phone no.

Form 8038-G (Rev. 9-2011)

Userid: SD_HJDCB schema instrx Leadpct: 0% Pt. size: 9 ❏ Draft ❏ Ok to Print

PAGER/XML Fileid: ...ents\work products\2011 8038g\INSTRUCTIONS\8038g 0920-2011.xml (Init. & date)

Page 1 of 4 Instructions for Form 8038-G 8:48 - 7-OCT-2011

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Department of the TreasuryInternal Revenue ServiceInstructions for Form

8038-G(Rev. September 2011)Information Return for Tax-Exempt Governmental Obligations

indenture or other bond documents. SeeSection references are to the Internal Rounding to Whole DollarsWhere To File next.Revenue Code unless otherwise noted. You may show amounts on this return as

whole dollars. To do so, drop amountsGeneral Instructions Where To File less than 50 cents and increase amountsfrom 50 cents through 99 cents to theFile Form 8038-G, and any attachments,Purpose of Formnext higher dollar.with the Department of the Treasury,

Form 8038-G is used by issuers of Internal Revenue Service Center, Ogden, Questions on Filing Formtax-exempt governmental obligations to UT 84201.provide the IRS with the information 8038-Grequired by section 149(e) and to monitor Private delivery services. You can use For specific questions on how to file Formthe requirements of sections 141 through certain private delivery services 8038-G send an email to the IRS at150. designated by the IRS to meet the “timely TaxExemptBondQuestions@irs.gov

mailing as timely filing/paying” rule for tax and put “Form 8038-G Question” in theWho Must File returns and payments. These private subject line. In the email include adelivery services include only the description of your question, a return

IF the issue price THEN, for tax-exempt following: email address, the name of a contact(line 21, column (b)) governmental • DHL Express (DHL): DHL Same Day person, and a telephone number.is... obligations issued Service.after December 31, Definitions• Federal Express (FedEx): FedEx1986, issuers must Priority Overnight, FedEx Standard Tax-exempt obligation. This is anyfile...

Overnight, FedEx 2Day, FedEx obligation, including a bond, installmentInternational Priority, and FedEx$100,000 or more A separate Form purchase agreement, or financial lease,

8038-G for each issue International First. on which the interest is excluded from• United Parcel Service (UPS): UPS Next income under section 103.Less than $100,000 Form 8038-GC, Day Air, UPS Next Day Air Saver, UPSInformation Return for Tax-exempt governmental obligation.2nd Day Air, UPS 2nd Day Air A.M., UPSSmall Tax-Exempt A tax-exempt obligation that is not aWorldwide Express Plus, and UPSGovernmental Bond private activity bond (see below) is aWorldwide Express.Issues, Leases, and tax-exempt governmental obligation. ThisThe private delivery service can tellInstallment Sales includes a bond issued by a qualified

you how to get written proof of the mailing volunteer fire department under sectiondate. 150(e).For all build America bonds and

Private activity bond. This includes anrecovery zone economic Other Forms That May Be obligation issued as part of an issue indevelopment bonds use FormCAUTION!

Required which:8038-B, Information Return for BuildFor rebating arbitrage (or paying a • More than 10% of the proceeds are toAmerica Bonds and Recovery Zonepenalty in lieu of arbitrage rebate) to the be used for any private activity businessEconomic Development Bonds. For taxFederal government, use Form 8038-T, use, andcredit bonds and specified tax creditArbitrage Rebate, Yield Reduction and • More than 10% of the payment ofbonds use Form 8038-TC, InformationPenalty in Lieu of Arbitrage Rebate. principal or interest of the issue is eitherReturn for Tax Credit Bonds and

(a) secured by an interest in property toSpecified Tax Credit Bonds.For private activity bonds, use Form be used for a private business use (or

8038, Information Return for Tax-ExemptWhen To File payments for such property) or (b) to bePrivate Activity Bond Issues. derived from payments for property (orFile Form 8038-G on or before the 15th

borrowed money) used for a privateday of the 2nd calendar month after the For build America bonds (Direct Pay), business use.close of the calendar quarter in which the build America bonds (Tax Credit), andbond is issued. Form 8038-G may not be It also includes a bond, the proceedsrecovery zone economic developmentfiled before the issue date and must be of which (a) are to be used directly orbonds, complete Form 8038-B,completed based on the facts as of the indirectly to make or finance loans (otherInformation Return for Build Americaissue date. than loans described in section 141(c)(2))Bonds and Recovery Zone Economicto persons other than governmental unitsLate filing. An issuer may be granted an Development Bonds.and (b) exceeds the lesser of 5% of theextension of time to file Form 8038-Gproceeds or $5 million.under Section 3 of Rev. Proc. 2002-48, For qualified forestry conservation

2002-37 I.R.B. 531, if it is determined that bonds, new clean renewable energy Issue price. The issue price ofthe failure to file timely is not due to willful bonds, qualified energy conservation obligations is generally determined underneglect. Type or print at the top of the bonds, qualified zone academy bonds, Regulations section 1.148-1(b). Thus,form “Request for Relief under section 3 qualified school construction bonds, clean when issued for cash, the issue price isof Rev. Proc. 2002-48” and attach a letter renewable energy bonds, Midwestern tax the first price at which a substantialexplaining why Form 8038-G was not credit bonds, and all other qualified tax amount of the obligations are sold to thesubmitted to the IRS on time. Also credit bonds (except build America public. To determine the issue price of anindicate whether the bond issue in bonds), file Form 8038-TC, Information obligation issued for property, seequestion is under examination by the IRS. Return for Tax Credit Bonds and sections 1273 and 1274 and the relatedDo not submit copies of the trust Specified Tax Credit Bonds. regulations.

Cat. No. 63774DSep 20, 2011

Page 2 of 4 Instructions for Form 8038-G 8:48 - 7-OCT-2011

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Issue. Generally, obligations are treated return for the same date of issue. If you exchanges the bonds that are part of theas part of the same issue if they are are filing to correct errors or change a issue for the underwriter’s (or otherissued by the same issuer, on the same previously filed return, check the purchaser’s) funds. For a lease ordate, and in a single transaction, or a Amended Return box in the heading of installment sale, enter the date interestseries of related transactions. However, the form. starts to accrue in a MM/DD/YYYYobligations issued during the same format.The amended return must provide allcalendar year (a) under a loan agreement the information reported on the original Line 8. If there is no name of the issue,under which amounts are to be advanced return, in addition to the new or corrected please provide other identification of theperiodically (a “draw-down loan”) or (b) information. Attach an explanation of the issue.with a term not exceeding 270 days, may reason for the amended return and writebe treated as part of the same issue if the Line 9. Enter the CUSIP (Committee onacross the top, “Amended Returnobligations are equally and ratably Uniform Securities IdentificationExplanation.” Failure to attach ansecured under a single indenture or loan Procedures) number of the bond with theexplanation may result in a delay inagreement and are issued under a latest maturity. If the issue does not haveprocessing the form.common financing arrangement (for a CUSIP number, write “None.”Line 1. The issuer’s name is the name ofexample, under the same official

the entity issuing the obligations, not the Line 10a. Enter the name and title of thestatement periodically updated to reflectname of the entity receiving the benefit of officer or other employee of the issuerchanging factual circumstances). Also, forthe financing. For a lease or installment whom the IRS may call for moreobligations issued under a draw-downsale, the issuer is the lessee or the information. If the issuer wishes toloan that meet the requirements of thepurchaser. designate a person other than an officerpreceding sentence, obligations issued

or other employee of the issuer (includingduring different calendar years may be Line 2. An issuer that does not have ana legal representative or paid preparer)treated as part of the same issue if all of employer identification number (EIN)whom the IRS may call for morethe amounts to be advanced under the should apply for one on Form SS-4,information about the return, enter thedraw-down loan are reasonably expected Application for Employer Identificationname, title, and telephone number ofto be advanced within 3 years of the date Number. You can get this form on the IRSsuch person on lines 3a and 3b.of issue of the first obligation. Likewise, website at IRS.gov or by calling

obligations (other than private activity 1-800-TAX-FORM (1-800-829-3676). You Complete lines 10a and 10b evenbonds) issued under a single agreement may receive an EIN by telephone by if you complete lines 3a and 3b.that is in the form of a lease or installment following the instructions for Form SS-4.CAUTION

!sale may be treated as part of the same Line 3a. If the issuer wishes to authorizeissue if all of the property covered by that a person other than an officer or other Part II—Type of Issueagreement is reasonably expected to be employee of the issuer (including a legaldelivered within 3 years of the date of representative or paid preparer) to Elections referred to in Part II areissue of the first obligation. communicate with the IRS and whom the made on the original bondArbitrage rebate. Generally, interest on IRS may contact about this return documents, not on this form.CAUTION

!a state or local bond is not tax-exempt (including in writing or by telephone),unless the issuer of the bond rebates to enter the name of such person here. The Identify the type of obligations issuedthe United States arbitrage profits earned person listed in line 3a must be an by entering the corresponding issue pricefrom investing proceeds of the bond in individual. Do not enter the name and title (see Issue price under Definitions earlier).higher yielding nonpurpose investments. of an officer or other employee of the Attach a schedule listing names and EINsSee section 148(f). issuer here (use line 10a for that of organizations that are to use proceeds

purpose). of these obligations, if different from thoseConstruction issue. This is an issue ofof the issuer, include a brief summary oftax-exempt bonds that meets both of the Note. By authorizing a person other thanthe use and indicate whether or not suchfollowing conditions: an authorized officer or other employee ofuser is a governmental orthe issuer to communicate with the IRS1. At least 75% of the availablenongovernmental entity.and whom the IRS may contact about thisconstruction proceeds are to be used for

return, the issuer authorizes the IRS toconstruction expenditures with respect to Line 18. Enter a description of the issuecommunicate directly with the individualproperty to be owned by a governmental in the space provided.entered on line 3a and consents tounit or a section 501(c)(3) organization,

Line 19. If the obligations are short-termdisclose the issuer’s return information toandtax anticipation notes or warrants (TANs)that individual, as necessary, to process2. All the bonds that are part of theor short-term revenue anticipation notesthis return.issue are qualified 501(c)(3) bonds,or warrants (RANs), check box 19a. If thebonds that are not private activity bonds, Lines 4 and 6. If you listed an individual obligations are short-term bondor private activity bonds issued to finance on line 3a to communicate with the IRS anticipation notes (BANs), issued with theproperty to be owned by a governmental and whom the IRS may contact about this expectation that they will be refunded withunit or a section 501(c)(3) organization. return, enter the number and street (or the proceeds of long-term bonds at someP.O. box if mail is not delivered to street future date, check box 19b. Do not checkIn lieu of rebating any arbitrage that address), city, town, or post office, state, both boxes.may be owed to the United States, the and ZIP code of that person. Otherwise,issuer of a construction issue may make enter the issuer’s number and street (or Line 20. Check this box if property otheran irrevocable election to pay a penalty. P.O. box if mail is not delivered to street than cash is exchanged for the obligation,The penalty is equal to 11/2% of the address), city, town, or post office, state, for example, acquiring a police car, a fireamount of construction proceeds that do and ZIP code. truck, or telephone equipment through anot meet certain spending requirements. series of monthly payments. (This type ofNote. The address entered on lines 4See section 148(f)(4)(C) and the obligation is sometimes referred to as aand 6 is the address the IRS will use forInstructions for Form 8038-T. “municipal lease.”) Also check this box ifall written communications regarding thereal property is directly acquired inprocessing of this return, including anySpecific Instructions exchange for an obligation to makenotices.periodic payments of interest andPart I—Reporting Authority Line 5. This line is for IRS use only. Do principal. Do not check this box if the

not make any entries in this box.Amended return. An issuer may file an proceeds of the obligation are received inamended return to change or add to the Line 7. The date of issue is generally the the form of cash, even if the term “lease”information reported on a previously filed date on which the issuer physically is used in the title of the issue.

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Page 3 of 4 Instructions for Form 8038-G 8:48 - 7-OCT-2011

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principal, interest, or call premium on any the conditions of the private businessPart III—Description ofother issue of bonds after 90 days of the tests or the private loan financing test toObligationsdate of issue, including proceeds that will be met, then such issue is also an issue

Line 21. For column (a), the final be used to fund an escrow account for of private activity bonds. Regulationsmaturity date is the last date the issuer this purpose. section 1.141-2(d)(3) defines a deliberatemust redeem the entire issue. action as any action taken by the issuerPart V—Description of that is within its control regardless ofFor column (b), see Issue price under Refunded Bonds whether there is intent to violate suchDefinitions earlier.

Complete this part only if the bonds are to tests. Regulations section 1.141-12For column (c), the stated redemptionbe used to refund a prior issue of explains the conditions to taking remedialprice at maturity of the entire issue is thetax-exempt bonds. For a lease or action that prevent an action that causessum of the stated redemption prices atinstallment sale, write “N/A” in the space an issue to meet the private businessmaturity of each bond issued as part ofto the right of the title for Part V. tests or private loan financing test fromthe issue. For a lease or installment sale,

being treated as a deliberate action.Lines 31 and 32. The remainingwrite “N/A” in column (c).Check the box if the issuer hasweighted average maturity is determinedFor column (d), the weighted average established written procedures to ensurewithout regard to the refunding. Thematurity is the sum of the products of the timely remedial action for all nonqualifiedweighted average maturity is determinedissue price of each maturity and the bonds according to Regulations sectionin the same manner as on line 21, columnnumber of years to maturity (determined 1.141-12 or other remedial actions(d).separately for each maturity and by taking authorized by the Commissioner underLine 34. If more than a single issue ofinto account mandatory redemptions), Regulations section 1.141-12(h).bonds will be refunded, enter the date ofdivided by the issue price of the entireLine 44. Check the box if the issuer hasissue of each issue. Enter the date in anissue (from line 21, column (b)). For aestablished written procedures to monitorMM/DD/YYYY format.lease or installment sale, enter insteadcompliance with the arbitrage, yieldthe total number of years the lease or Part VI—Miscellaneous restriction, and rebate requirements ofinstallment sale will be outstanding.section 148.Line 35. An allocation of volume cap isFor column (e), the yield, as defined in

required if the nonqualified amount for the Line 45a. Check the box if some part ofsection 148(h), is the discount rate that,issue is more than $15 million but is not the proceeds was used to reimbursewhen used to compute the present valuemore than the amount that would cause expenditures. Figure and then enter theof all payments of principal and interest tothe issue to be private activity bonds. amount of proceeds that are used tobe paid on the obligation, produces an

reimburse the issuer for amounts paid forLine 36. If any portion of the grossamount equal to the purchase price,a qualified purpose prior to the issuanceproceeds of the issue is or will beincluding accrued interest. Seeof the bonds. See Regulations sectioninvested in a guaranteed investmentRegulations section 1.148-4 for specific1.150-2.contract (GIC), as defined in Regulationsrules to compute the yield on an issue. If

section 1.148-1(b), enter the amount ofthe issue is a variable rate issue, write Line 45b. An issuer must adopt anthe gross proceeds so invested, as well“VR” as the yield of the issue. For other official intent to reimburse itself foras the final maturity date of the GIC andthan variable rate issues, carry the yield preissuance expenditures within 60 daysthe name of the provider of such contract.out to four decimal places (for example, after payment of the original expenditure

5.3125%). If the issue is a lease or unless excepted by Regulations sectionLine 37. Enter the amount of theinstallment sale, enter the effective rate of 1.150-2(f). Enter the date the officialproceeds of this issue used to make ainterest being paid. intent was adopted. See Regulationsloan to another governmental unit, the

section 1.150-2(e) for more informationinterest of which is tax-exempt.Part IV—Uses of Proceeds of about official intent.Line 38. If the issue is a loan ofBond Issueproceeds from another tax-exempt issue, Signature and ConsentFor a lease or installment sale, write “N/A” check the box and enter the date of issue,

in the space to the right of the title for Part An authorized representative of the issuerEIN, and name of issuer of the masterIV. must sign Form 8038-G and anypool obligation.

applicable certification. Also print theLine 22. Enter the amount of proceeds Line 40. Check this box if the issue is a name and title of the person signing Formthat will be used to pay interest from the construction issue and an irrevocable 8038-G. The authorized representative ofdate the bonds are dated to the date of election to pay a penalty in lieu of the issuer signing this form must have theissue. arbitrage rebate has been made on or authority to consent to the disclosure ofLine 24. Enter the amount of the before the date the bonds were issued. the issuer’s return information, asproceeds that will be used to pay bond The penalty is payable with a Form necessary to process this return, to theissuance costs, including fees for trustees 8038-T for each 6-month period after the person(s) that have been designated inand bond counsel. If no bond proceeds date the bonds are issued. Do not make Form 8038-G.will be used to pay bond issuance costs, any payment of penalty in lieu of arbitrageNote. If the issuer in Part 1, lines 3a andenter zero. Do not leave this line blank. rebate with this form. See Rev. Proc.3b authorizes the IRS to communicate92-22, 1992-1 C.B. 736 for rulesLine 25. Enter the amount of the(including in writing and by telephone)regarding the “election document.”proceeds that will be used to pay fees forwith a person other than an officer orcredit enhancement that are taken into Line 41a. Check this box if the issuer other employee of the issuer, by signingaccount in determining the yield on the has identified a hedge on its books and this form, the issuer’s authorizedissue for purposes of section 148(h) (for records according to Regulations sections representative consents to the disclosureexample, bond insurance premiums and 1.148-4(h)(2)(viii) and 1.148-4(h)(5) that of the issuer’s return information, ascertain fees for letters of credit). permit an issuer of tax-exempt bonds to necessary to process this return, to suchidentify a hedge for it to be included inLine 26. Enter the amount of proceeds person.yield calculations for computing arbitrage.that will be allocated to such a fund.Paid PreparerLine 42. In determining if the issuer hasLine 27. Enter the amount of the

super-integrated a hedge, apply the rulesproceeds that will be used to pay If an authorized officer of the issuer filledof Regulations section 1.148-4(h)(4). Ifprincipal, interest, or call premium on any in this return, the paid preparer’s spacethe hedge is super-integrated, check theother issue of bonds within 90 days of the should remain blank. Anyone whobox.date of issue. prepares the return but does not charge

Line 28. Enter the amount of the Line 43. If the issuer takes a “deliberate the organization should not sign theproceeds that will be used to pay action” after the issue date that causes return. Certain others who prepare the

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Page 4 of 4 Instructions for Form 8038-G 8:48 - 7-OCT-2011

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Learning about the law or 2 hr., 41 min.return should not sign. For example, a the information. We need it to ensure thatthe form . . . . . . . . . . . . .regular, full-time employee of the issuer, you are complying with these laws.Preparing, copying, 3 hr., 3 min.such as a clerk, secretary, etc., should You are not required to provide theassembling, and sendingnot sign. information requested on a form that isthe form to the IRS . . . . . .Generally, anyone who is paid to subject to the Paperwork Reduction Act

prepare a return must sign it and fill in the unless the form displays a valid OMB If you have comments concerning theother blanks in the Paid Preparer Use control number. Books or records relating accuracy of these time estimates orOnly area of the return. to a form or its instructions must be suggestions for making this form simpler,

retained as long as their contents mayThe paid preparer must: we would be happy to hear from you. Youbecome material in the administration of• Sign the return in the space provided can write to the Internal Revenue Service,any Internal Revenue law. Generally, taxfor the preparer’s signature (a facsimile Tax Products Coordinating Committee,returns and return information aresignature is acceptable), SE:W:CAR:MP:T:M:S, 1111 Constitutionconfidential, as required by section 6103.• Enter the preparer information, and Ave. NW, IR-6526, Washington, DC

• Give a copy of the return to the issuer. The time needed to complete and file 20224. Do not send the form to thisthis form varies depending on individual office. Instead, see Where To File.

Paperwork Reduction Act Notice. We circumstances. The estimated averageask for the information on this form to time is:carry out the Internal Revenue laws of theUnited States. You are required to give us

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