ATTACHMENT B
Master Equipment Lease Purchase Agreement
Holman Capital Corporation
INDEX TO LEGAL DOCUMENTS
PAYMENT SCHEDULE NO. 02
UNDER MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT
DATED OCTOBER 28, 2020 BY AND BETWEEN
HOLMAN CAPITAL CORPORATION
And
CITY OF BARSTOW
Lease Documents:
PAYMENT SCHEDULE NO. 02
Exhibit A-1 – Notice and Acknowledgment of Assignment;
Exhibit B-1 – Insurance Coverage Request;
Exhibit B-2 – Self-Insurance Rider (if applicable);
Exhibit C – Essential Use Certificate;
Exhibit D – Incumbency Certificate;
Exhibit E – Opinion of Lessee’s Counsel;
Exhibit F – Bank Qualified Certificate
Exhibit G – Post Issuance Tax Compliance Procedures;
Exhibit H – Escrow Agreement;
Exhibit I - Resolution of Lessee;
Exhibit J - UCC-1 Financing Statement with attached Schedule A (to be filed by the Investor); Exhibit K - Form 8038-G; and
Exhibit L - Closing Memorandum/Payment Proceeds Direction
HOLMAN CAPITAL CORPORATION
PAYMENT SCHEDULE NO. 02
UNDER MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT DATED OCTOBER 28, 2020
1. DESCRIPTION OF THE EQUIPMENT:
Fire Apparatus purchased pursuant to that certain Agreement with South Coast Fire Equipment, Inc. (the “Vendor”) Fire and Brush Trucks financed by this Payment Schedule dated May 20, 2025, to that certain Master Equipment LeasePurchase Agreement dated October 28, 2020 by and between Holman Capital Corporation and City of Barstow including, without limitation, the following:
together with all accessories, attachments, substitutions and accessions.
2. EQUIPMENT LOCATION: 220 E. Mountain View Avenue, Barstow, CA 92311
3. RENTAL PAYMENT SCHEDULE: The rental payments shall be made for the Equipment as follows:
Description Type 1 Fire Truck Brush Truck Total
Estimated Delivery July 1, 2028 February 1, 2025
Fleet Status Replacement Addition
Fire Apparatus $ 1,063,435.00 $ 527,549.00 $ 1,590,984.00 Prepay Discount $ (132,330.00) $ - $ (132,330.00)
Total Project Cost $ 931,105.00 $ 527,549.00 $ 1,458,654.00 Sales Tax @8.75% $ 81,471.69 $ 46,160.54 $ 127,632.23
Apparatus with Sales Tax $ 1,012,576.69 $ 573,709.54 $ 1,586,286.23 Performance Bond $ 2,605.42 $ 1,292.50 $ 3,897.92
California Tire Fee $ 10.50 $ 14.00 $ 24.50
Contingency $ 104,791.35 $ 104,791.35
Total Project Cost $ 1,119,983.96 $ 575,016.04 $ 1,695,000.00 Documentation Fee $ 5,000.00 $ - $ 5,000.00
Total Financing Amount $ 1,124,983.96 $ 575,016.04 $ 1,700,000.00
* Assumes that all rental payments and additional rentals due on and prior to that date have been paid.
Rental payments are calculated on the basis of a 360-day year consisting of 12 months of 30 days.
4. INTEREST RATE: 6.24%
5. COMMENCEMENT DATE: May 20, 2025
6. SCHEDULED LEASE TERM: 20 Years
7. Lessee’s current Fiscal Year extends from June 30, 2024.
PAYMENT NO. DATE PAYMENT
INTEREST
COMPONENT
PRINCIPAL
COMPONENT
PURCHASE
OPTION
0 1/24/2025
1 7/24/2025 $ 74,979.47 $ 53,040.00 $ 21,939.47 $ 1,787,134.46 2 1/24/2026 $ 74,979.47 $ 52,355.49 $ 22,623.98 $ 1,763,039.93 3 7/24/2026 $ 74,979.47 $ 51,649.62 $ 23,329.85 $ 1,738,193.64 4 1/24/2027 $ 74,979.47 $ 50,921.73 $ 24,057.74 $ 1,712,572.14 5 7/24/2027 $ 74,979.47 $ 50,171.13 $ 24,808.34 $ 1,686,151.26 6 1/24/2028 $ 74,979.47 $ 49,397.11 $ 25,582.36 $ 1,658,906.05 7 7/24/2028 $ 74,979.47 $ 48,598.94 $ 26,380.53 $ 1,630,810.78 8 1/24/2029 $ 74,979.47 $ 47,775.87 $ 27,203.60 $ 1,601,838.95 9 7/24/2029 $ 74,979.47 $ 46,927.11 $ 28,052.36 $ 1,571,963.19 10 1/24/2030 $ 74,979.47 $ 46,051.88 $ 28,927.59 $ 1,541,155.30 11 7/24/2030 $ 74,979.47 $ 45,149.34 $ 29,830.13 $ 1,509,386.21 12 1/24/2031 $ 74,979.47 $ 44,218.64 $ 30,760.83 $ 1,476,625.93 13 7/24/2031 $ 74,979.47 $ 43,258.90 $ 31,720.57 $ 1,442,843.52 14 1/24/2032 $ 74,979.47 $ 42,269.22 $ 32,710.25 $ 1,408,007.11 15 7/24/2032 $ 74,979.47 $ 41,248.66 $ 33,730.81 $ 1,372,083.79 16 1/24/2033 $ 74,979.47 $ 40,196.26 $ 34,783.21 $ 1,335,039.67 17 7/24/2033 $ 74,979.47 $ 39,111.02 $ 35,868.45 $ 1,296,839.78 18 1/24/2034 $ 74,979.47 $ 37,991.93 $ 36,987.54 $ 1,257,448.05 19 7/24/2034 $ 74,979.47 $ 36,837.91 $ 38,141.56 $ 1,216,827.28 20 1/24/2035 $ 74,979.47 $ 35,647.90 $ 39,331.57 $ 1,174,939.16 21 7/24/2035 $ 74,979.47 $ 34,420.75 $ 40,558.72 $ 1,131,744.13 22 1/24/2036 $ 74,979.47 $ 33,155.32 $ 41,824.15 $ 1,087,201.41 23 7/24/2036 $ 74,979.47 $ 31,850.41 $ 43,129.06 $ 1,041,268.96 24 1/24/2037 $ 74,979.47 $ 30,504.78 $ 44,474.69 $ 993,903.41 25 7/24/2037 $ 74,979.47 $ 29,117.17 $ 45,862.30 $ 945,060.06 26 1/24/2038 $ 74,979.47 $ 27,686.27 $ 47,293.20 $ 894,692.80 27 7/24/2038 $ 74,979.47 $ 26,210.72 $ 48,768.75 $ 842,754.09 28 1/24/2039 $ 74,979.47 $ 24,689.13 $ 50,290.34 $ 789,194.87 29 7/24/2039 $ 74,979.47 $ 23,120.08 $ 51,859.39 $ 733,964.62 30 1/24/2040 $ 74,979.47 $ 21,502.06 $ 53,477.41 $ 677,011.18 31 7/24/2040 $ 74,979.47 $ 19,833.57 $ 55,145.90 $ 618,280.80 32 1/24/2041 $ 74,979.47 $ 18,113.01 $ 56,866.46 $ 557,718.02 33 7/24/2041 $ 74,979.47 $ 16,338.78 $ 58,640.69 $ 495,265.68 34 1/24/2042 $ 74,979.47 $ 14,509.19 $ 60,470.28 $ 430,864.83 35 7/24/2042 $ 74,979.47 $ 12,622.52 $ 62,356.95 $ 364,454.68 36 1/24/2043 $ 74,979.47 $ 10,676.98 $ 64,302.49 $ 295,972.53 37 7/24/2043 $ 74,979.47 $ 8,670.74 $ 66,308.73 $ 225,353.73 38 1/24/2044 $ 74,979.47 $ 6,601.91 $ 68,377.56 $ 152,531.63 39 7/24/2044 $ 74,979.47 $ 4,468.53 $ 70,510.94 $ 77,437.48 40 1/24/2045 $ 74,979.47 $ 2,268.22 $ 72,711.25 $ -
Grand Totals $ 2,999,178.80 $ 1,299,178.80 $ 1,700,000.00 $ -
8. The terms and provisions of the Master Equipment Lease-Purchase Agreement described above are hereby incorporated into this Payment Schedule by reference and made a part hereof.
9. Lessee hereby consents to the assignment by the Lessor of its rights under this Payment Schedule, which rights are evidenced by the Assignment Agreement entered into concurrently with this Payment Schedule.
10. Lessee hereby represents, warrants, and covenants that (i) its representations, warranties, and covenants set forth in the Master Equipment Lease-Purchase Agreement (particularly Paragraph 21 thereof) are true and correct as though made on the date of execution of this Schedule, and (ii) sufficient funds have been appropriated by Lessee for the payment of all rental payments due under this Payment Schedule during Lessee’s current Fiscal Year.
11. Interest, if any, accruing from the Commencement Date hereof to the actual date of funding shall be retained by Lessor as additional consideration for entering into this Schedule.
12. The following exhibits are incorporated into this Payment Schedule by this reference: Exhibit A-1 – Notice and Acknowledgment of Assignment; Exhibit B-1 – Insurance Coverage Request or, as applicable, Exhibit B-2 – Self-Insurance Rider; Exhibit C – Essential Use Certificate; Exhibit D - Incumbency Certificate; Exhibit E – Opinion of Lessee’s Counsel; Exhibit F – Bank Qualified Certificate; Exhibit G – Post-Issuance Tax Compliance Procedures; Exhibit H – Escrow Agreement; Exhibit I – Resolution of Lessee; Exhibit J – UCC-1 Financing Statement; Exhibit K – Form 8038-G; and Exhibit L – Closing Memorandum.
[Signature Page Follows]
CITY OF BARSTOW, as Lessee HOLMAN CAPITAL CORPORATION, as Lessor By: By:
Name: Rochelle Clayton
Title: City Manager
Name: Lance Holman
Title: President & CEO
Counterpart No. _____ of two manually executed and serially numbered counterparts. To the extent that this Schedule constitutes chattel paper (as defined in the applicable provisions of the Uniform Commercial Code as enacted in the applicable state), no security or ownership interest herein may be created through the transfer or possession of any Counterpart other than Counterpart No. 1.
[Signature Page to the Payment Schedule]
EXHIBIT A-1
NOTICE AND ACKNOWLEDGEMENT OF SALE OF RENTAL PAYMENTS AND ASSIGNMENT OF PAYMENT SCHEDULE NO. 02 AND ESCROW AGREEMENT Holman Capital Corporation (“Lessor”) and the City of Barstow(“Lessee”) have entered into a Master Equipment Lease-Purchase Agreement dated October 28, 2020 (the “Master Lease Agreement”) and Payment Schedule No. 02 issued thereunder dated May 20, 2025 under which Lessee has, or will have prior to its execution hereof, leased equipment (the “Equipment”) described in that Payment Schedule.
Lessee is hereby notified that Lessor has assigned its right, title, and interest in and to Payment Schedule No. 02, the leased Equipment, and the rental payments as permitted by Payment Schedule No. 02 in accordance with the Master Lease Agreement.
Lessee is hereby directed to pay any and all rental payments and other amounts due under Payment Schedule No. 02 to Mechanics Bank and/or its affiliates, as Lessor’s assignee (the “Assignee”), as directed by the Assignee or a paying agent acting on behalf of Assignee, pursuant to the instructions contained in any invoice or notice. Lessee will also direct any and all correspondence, notice and servicing requests to the Assignee at the following address:
Mechanics Bank
Attn: Loan Servicing Department
1111 Civic Drive
Suite 385
Walnut Creek, CA 94596
By signing this Notice and Acknowledgment, Lessee agrees that it will pay all amounts due under Payment Schedule No. 02 as directed in the invoice without any set-off or deduction whatsoever notwithstanding any defect in, damage to or requisition of any of the Equipment leased under Payment Schedule No. 02, any other similar or dissimilar event, any defense, set-off, counterclaim or recoupment arising out of any claim against Lessor or Assignee.
Lessee further acknowledges and agrees that Assignee has not assumed any of Lessor’s obligations or duties under the Master Lease Agreement or Payment Schedule No. 02, or made any warranties whatsoever as to the Master Lease Agreement, Payment Schedule No. 02 or the Equipment. Lessee agrees that no change may be made to the Master Lease Agreement or Payment Schedule No. 02 without the prior written consent of Assignee.
By signing this Notice and Acknowledgment, Lessee warrants that its representations and warranties under the Lease Agreement are true and correct on the date hereof.
Date: May 20, 2025
CITY OF BARSTOW, as Lessee
By: ________________________________________
Name: Rochelle Clayton
Title: City Manager
EXHIBIT B-1
INSURANCE CERTIFICATION
[complete only if Lessee is not self-insured]
Holman Capital Corporation
25231 Paseo De Alicia
Suite 105
Laguna Hills, CA 92653
May 20, 2025
Re: Payment Schedule No. 02 under Master Equipment Lease-Purchase Agreement dated October 28, 2020
In connection with the above-referenced Payment Schedule No. 02 and Master Lease Agreement, City of Barstow, as lessee (the “Lessee”) certifies that it has instructed the insurance agent named below (please fill in name, address, and telephone number):
Name of Agent: Public Entity Risk Management Authority
Address: 36-951 Cook Street, Suite 101
Palm Desert, CA 92211
Phone: (760) 360-4966
to issue:
X
Liability Insurance. Lessee is required to maintain public liability insurance, personal injury and property damage with policy limits of $3,000,000. The policy should be endorsed to name Mechanics Bank (the assignee of Holman Capital Corporation) as an additional insured.
X
Casualty Insurance. Lessee is required to maintain all risk extended coverage, malicious mischief and vandalism insurance for the Equipment described in the above-referenced Payment Schedule in an amount not less than the greater of $1,700,000.00 or the full replacement cost of the Equipment. Such insurance shall be endorsed to name Mechanics Bank as a co-loss payee with respect to such Equipment.
The required insurance should also be endorsed to give Mechanics Bank at least 30 days’ prior written notice of the effective date of any material alteration or cancellation of coverage, and an endorsement confirming that the interest of Mechanics Bank shall not be invalidated by any actions, inactions, breach of warranty or conditions or negligence of Lessee.
Proof of insurance coverage will be provided to Mechanics Bank prior to and/or commensurate with the later of the Commencement Date of Payment Schedule No. 02 or the delivery and acceptance of the Equipment.
CITY OF BARSTOW, as Lessee
By: ________________________________________
Name: Rochelle Clayton
Title: City Manager
EXHIBIT B-2
[complete only if Lessee is self-insured]
Holman Capital Corporation
25231 Paseo De Alicia
Suite 105
Laguna Hills, CA 92653
May 20, 2025
Re: Payment Schedule No. 02 under Master Equipment Lease-Purchase Agreement dated October 28, 2020 In connection with the above-referenced Payment Schedule No. 02, City of Barstow, as lessee (the “Lessee”) certifies that it participates in an actuarially sound self-insurance program for property damage and public liability risks.
The following is attached (check all that apply):
Letter from risk manager describing self-insurance program Other evidence of Lessee’s participation in self-insurance program Very truly yours,
CITY OF BARSTOW, as Lessee
By: ________________________________________
Name: Rochelle Clayton
Title: City Manager
EXHIBIT C
ESSENTIAL USE CERTIFICATE
Holman Capital Corporation
25231 Paseo De Alicia
Suite 105
Laguna Hills, CA 92653
May 20, 2025
Re: Payment Schedule No. 02 under Master Equipment Lease-Purchase Agreement dated October 28, 2020 I, Rochelle Clayton, appointed, or designated representative and City Manager of the City of Barstow , as lessee (the “Lessee”), am qualified to answer the questions set forth below regarding the Equipment to be acquired by Lessee in connection with the above-referenced Payment Schedule:
1. What is the specific use of the Equipment?
To help protect the citizenry of Barstow to have the proper firefighting equipment to allow the firefighters to work faster and more efficiently during emergencies.
2. What increased capabilities will the Equipment provide? The Equipment replaces existing fire apparatus that will have reached the end of its economic useful life upon delivery of the new Type 1 Fire Truck. This new truck will incorporate more advanced safety features. The Brush Truck is a new unit that will offer greater fire suppression capacity and enhance firefighter safety.
3. Why is the Equipment essential to your ability to deliver governmental services? The City’s Fire Department’s primary function is to provide fire protection services to its citizens. The Equipment is essential to furthering these fire protection services in protecting persons and properties in and around the City.
4. Does the Equipment replace existing equipment?
(If so, please explain why you are replacing the existing equipment) The Type #3 Brush Truck is an addition to their fleet as it is highly essential to perform efficient service to their citizenry. The Enforcer Pierce Type #1 Ultimate Configuration Pumper Truck is to replace an existing Truck that upon delivery will be at the end of its useful life. It is taking up to 4 years to build this truck and the City is being proactive to make sure they have the proper equipment to provide a safe environment for its citizens and their property.
5. Why did you choose this specific Equipment?
These trucks met the specifications of our needs to incorporate advanced safety features, better water pumps and improved technology.
6. For how many years do you expect to utilize the Equipment? The Pumper truck will last at least 20 years and the Brush Truck should last up to 20 years.
Very truly yours,
CITY OF BARSTOW, as Lessee
By: ___________________________________________
Name: Rochelle Clayton
Title: City Manager
[Signature page for the Essential Use Certificate]
EXHIBIT D
INCUMBENCY CERTIFICATE
I, Sydnie Harris, do hereby certify that I am the Finance Director of the City of Barstow (“City”), which is a body corporate and politic duly established and validly existing as a political subdivision of the State of California and operates under a Governing Board, and that I have custody of the records of such entity.
I hereby certify that, as of the date hereof, the individuals named below are the duly elected or appointed officers of the City holding the offices set forth opposite their respective names. I further certify that:
(i) The signatures set opposite their respective names and titles are their true and authentic signatures, and (ii) Such officers have the authority on behalf of such entity to:
a. Enter into that certain Payment Schedule No. 02, dated May 20, 2025 under Master Equipment Lease-Purchase Agreement dated October 28, 2020 (the “Lease Agreement”), between the City of Barstow and Holman Capital Corporation, as lessor, and that certain Escrow Agreement dated as of May 20, 2025 (the “Escrow Agreement”) between the City of Barstow, Holman Capital Corporation, and Mechanics Bank, as escrow agent; and
b. Execute Certificates of Acceptance, Payment Request/Disbursement Request Forms, and any and all other certificate, documents, and agreements relating to the Master Lease Agreement, Payment Schedule No. 02 and Escrow Agreement applicable to that Payment Schedule.
NAME TITLE SIGNATURE
Rochelle Clayton City Manager
IN WITNESS WHEREOF, I have duly executed this Certificate on behalf of the City of Barstow.
May 20, 2025
By: ____________________________________
Name: Sydnie Harris
Title: Finance Director
EXHIBIT E
[Print on Counsel Letterhead]
OPINION OF LESSEE’S COUNSEL
May 20, 2025
Holman Capital Corporation
25231 Paseo De Alicia
Suite 105
Laguna Hills, CA 92653
Re: Payment Schedule No. 02 under Master Equipment Lease-Purchase Agreement dated October 28, 2020 Ladies and Gentlemen:
As counsel to the City of Barstow (the “Lessee”), I have examined the Master Equipment Lease-Purchase Agreement dated October 28, 2020 and Payment Schedule No. 02 dated May 20, 2025 both collectively, the “Lease Agreement”), between the Lessee and Holman Capital Corporation, as lessor (“Lessor”), the form of the Escrow Agreement for Payment Schedule No. 02, together with the Disbursement Request Form and Certificate of Acceptance (collectively, the “Escrow Agreement”), and the proceedings taken by the Governing Body of the Lessee to authorize on behalf of the Lessee the execution and delivery of the Master Lease Agreement, Payment Schedule No. 02 and the Escrow Agreement.
The Master Lease Agreement, Payment Schedule No. 02 and the Escrow Agreement are herein collectively referred to as the “Transaction Documents.” Based upon the foregoing examination and upon an examination of such other documents and matters of law as I have deemed necessary or appropriate, I am of the opinion that:
1. The Lessee is a political subdivision of the State of California and operates under a Governing Board, and the laws of the State of California with full power and authority to enter into the Transaction Documents.
2. The Transaction Documents have each been duly authorized, executed, and delivered by the Lessee. Assuming due authorization, execution and delivery thereof by Lessor, the Transaction Documents constitute legal, valid, and binding obligations of the Lessee, enforceable against the Lessee in accordance with their respective terms, subject to any applicable bankruptcy, insolvency, moratorium or other laws or equitable principles affecting the enforcement of creditors’ rights generally.
3. The Equipment to be leased pursuant to the Lease Agreement constitutes personal property and, when subjected to use by the Lessee, will not be a fixture under applicable law.
4. The Lessee has complied with any applicable public bidding requirements in connection with the Transaction Documents and the transactions contemplated thereby. By proper action, the Governing Body of the Lessee authorized the execution and delivery of the Transaction Documents and certain other matters, which actions were duly taken at a meeting that was held in compliance with all applicable laws relating to the holding of open and public meetings.
5. No litigation or proceeding is pending or, to the best of my knowledge, threatened to restrain or enjoin the execution, delivery, or performance by the Lessee of the Transaction Documents or in any way to contest the validity of the Transaction Documents, to contest or question the creation or existence of the Lessee or the Governing Body of the Lessee or the authority or ability of the Lessee to execute or deliver the Transaction Documents or to comply with or perform its obligations thereunder. There is no litigation pending or, to the best of my knowledge, threatened seeking to restrain or enjoin the Lessee from annually appropriating sufficient funds to pay the rental payments or other amounts contemplated by the Master Lease Agreement and Payment Schedule No. 02.
6. The entering into and performance of the Transaction Documents do not and will not violate any judgment, order, law, or regulation applicable to the Lessee or result in any breach of, or constitute a default under, or result in the creation of any lien, charge, security interest, or other encumbrance upon any assets of the Lessee or on the Equipment
(as such term is defined in the Lease Agreement) pursuant to any indenture, mortgage, deed of trust, bank loan or credit agreement, or other instrument to which the Lessee is a party or by which it or its assets may be bound. Notwithstanding the foregoing, upon the due and timely filing of a UCC-1 and a Title Application and/or Certificate of Title (the latter solely with respect to Equipment constituting titled vehicles), the Lessor will have a perfected security interest in the Equipment.
This opinion may be relied upon by Lessor and purchasers and assignees of Lessor’s interests in connection with Payment Schedule No. 02 the Lease Agreement.
Respectfully submitted,
_______________________________________
EXHIBIT F
BANK-QUALIFIED DESIGNATION
The City of Barstow, as lessee, (the “Lessee”) under that certain Master Equipment Lease-Purchase Agreement dated October 28, 2020 and Payment Schedule No. 02 issued thereunder (collectively, the “Lease”) to which this Designation is attached, hereby designates the Lease as a “qualified tax-exempt obligation” for the purposes and within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. The Lessee hereby represents that the Lessee is a “qualified small issuer” in that it reasonably anticipates that the Lessee and other entities that the Lessee controls will not issue tax-exempt obligations (including the Lease) the aggregate principal amount of which exceed $10,000,000 during the calendar year in which the Lease is executed and delivered and interest commences to accrue thereunder; and that the Lease is being entered into and will be used in connection with public purposes.
This Designation is attached to and made a part of the Lease and inures to the benefit of the Lessor and its successors and/or assigned.
EXECUTED as of this May 20, 2025.
CITY OF BARSTOW, as Lessee
By: ________________________
Name: Rochelle Clayton
Title: City Manager
EXHIBIT G
POST-ISSUANCE TAX COMPLIANCE PROCEDURES
Dated: May 20, 2025
The following certificate is delivered in connection with the execution and delivery of Payment Schedule No. 02 issued under the Master Equipment Lease-Purchase Agreement dated October 28, 2020 (the "Master Lease Agreement"), entered into between the City of Barstow (the "Lessee") and Holman Capital Corporation (the "Corporation"). Capitalized terms used herein have the meanings defined in the Lease Agreement.
Section 1. In General.
1.1. This Certificate is executed for the purpose of establishing the reasonable expectations of Lessee as to future events regarding the financing of certain equipment (the “Equipment”) to be acquired by Lessor and leased to Lessee pursuant to and in accordance with Payment Schedule No. 02 executed under the Master Lease Agreement (together with all related documents executed pursuant thereto and contemporaneously herewith, the "Financing Documents"). As described in the Financing Documents, Lessor shall apply $1,700,000.00 (the “Principal Amount”) toward the acquisition of the Equipment and closing costs, and Lessee shall make Rental Payments under the terms and conditions as set forth in the Financing Documents.
1.2. The individual executing this Certificate on behalf of Lessee is an officer of Lessee delegated with the responsibility of reviewing and executing the Financing Documents, pursuant to the governing board’s approval or other official action of Lessee adopted with respect to the Financing Documents, a copy of which has been delivered to Lessor.
1.3. The Financing Documents are being entered into for the purpose of providing funds for financing the cost of acquiring, equipping and installing the Equipment which is essential to the governmental functions of Lessee, which Equipment is described in said Payment Schedule No. 02. The Principal Amount will be deposited in escrow by Lessor on the date of issuance of the Financing Documents and held by Mechanics Bank, as escrow agent (the "Escrow Agent") pending acquisition of the Equipment under the terms of that certain Escrow Agreement for Payment Schedule No. 02 dated as of May 20, 2025 (the "Escrow Agreement"), by and between Lessor, Lessee and Escrow Agent.
1.4. Lessee will timely file for each Payment Schedule issued under the Master Lease Agreement a Form 8038-G (or, if the invoice price of the Equipment under such schedule is less than $100,000, a Form 8038-GC) relating to such Lease with the Internal Revenue Service in accordance with Section 149(e) of the Internal Revenue Code of 1986, as amended (the “Code”).
1.5. The Lease is designated a “qualified tax-exempt obligation” for the purposes and within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. In that regard, the Lessee is a “qualified small issuer” in that it reasonably anticipates that the Lessee and other entities that the Lessee controls will not issue tax-exempt obligations (including the Lease) the aggregate principal amount of which exceed $10,000,000 during the calendar year in which the Lease is executed and delivered and interest commences to accrue thereunder; and that the Lease is being entered into and will be used in connection with public purposes.
Section 2. Non-Arbitrage Certifications.
2.1. The Rental Payments due under the Financing Documents will be made with monies retained in Lessee's general operating fund (or an account or subaccount therein). No sinking, debt service, reserve or similar fund or account will be created or maintained for the payment of the Rental Payments due under the Financing Documents or pledged as security therefor.
2.2. There have been and will be issued no obligations by or on behalf of Lessee that would be deemed to be (i) issued or sold within fifteen (15) days before or after the date of issuance of the Financing Documents, (ii) issued or sold pursuant to a common plan of financing with the Financing Documents and (iii) paid out of substantially the same source of funds
as, or deemed to have substantially the same claim to be paid out of substantially the same source of funds as, the Financing Documents.
2.3. Lessee does not and will not have on hand any funds that are or will be restricted, segregated, legally required or otherwise intended to be used, directly or indirectly, as a substitute, replacement or separate source of financing for the Equipment.
2.4. No portion of the Principal Amount is being used by Lessee to acquire investments which produce a yield materially higher than the yield realized by Lessor from Rental Payments received under the Financing Documents.
2.5. The Principal Amount does not exceed the amount necessary for the governmental purpose for which the Financing Documents were entered into. Such funds are expected to be needed and fully expended for payment of the costs of acquiring, equipping and installing the Equipment.
2.6. Lessee does not expect to convey, sublease or otherwise dispose of the Equipment, in whole or in part, at a date which is earlier than the final Payment Date under the Financing Documents.
Section 3. Disbursement of Funds; Reimbursement to Lessee.
3.1 It is contemplated that the entire Principal Amount will be used to pay the acquisition cost of Equipment to the vendors or manufacturers thereof or for any financial advisory or closing costs, provided that, if applicable, a portion of the principal amount may be paid to Lessee as reimbursement for acquisition cost payments already made by it so long as the conditions set forth in Section 3.2 below are satisfied.
3.2. Lessee shall not request that it be reimbursed for Equipment acquisition cost payments already made by it unless each of the following conditions have been satisfied:
(a) If applicable, Lessee adopted a Resolution or otherwise declared its official intent in accordance with Treasury Regulation § 1.150-2 (a copy of which will be provided to Lessor, if applicable, the “Declaration of Official Intent”), wherein Lessee expressed its intent to be reimbursed from the proceeds of a borrowing for all or a portion of the cost of the Equipment, which expenditure was paid to the Vendor (as defined in the Master Lease Agreement) not earlier than sixty (60) days before Lessee adopted the Declaration of Official Intent; (b) The reimbursement being requested will be made by a written allocation before the later of eighteen (18) months after the expenditure was paid or eighteen (18) months after the items of Equipment to which such payment relates were placed in service;
(c) The entire payment with respect to which reimbursement is being sought is a capital expenditure, being a cost of a type properly chargeable to a capital account under general federal income tax principles; and (d) Lessee will use any reimbursement payment for general operating expenses and not in a manner which could be construed as an artifice or device under Treasury Regulation § 1.148-10 to avoid, in whole or in part, arbitrage yield restrictions or arbitrage rebate requirements.
Section 4. Use and Investment of Funds; Temporary Period.
4.1. Lessee has incurred or will incur, within six (6) months from the date of issuance of the Financing Documents, binding obligations to pay an amount equal to at least five percent (5%) of the Principal Amount toward the costs of the Equipment. An obligation is not binding if it is subject to contingencies within Lessee’s control. The ordering and acceptance of the items of Equipment will proceed with due diligence to the date of final acceptance of the Equipment.
4.2. An amount equal to at least eighty-five percent (85%) of the Principal Amount will be expended to pay the cost of the Equipment by the end of the three-year period commencing on the date of this Certificate. No portion of the Principal Amount will be used to acquire investments that do not carry out the governmental purpose of the Financing Documents and that have a substantially guaranteed yield of four (4) years or more.
4.3.(a) Lessee covenants and agrees that it will rebate an amount equal to excess earnings on the Principal Amount deposited under the Escrow Agreement to the Internal Revenue Service if required by, and in accordance with, Section 148(f) of the Code, and make the annual determinations and maintain the records required by and otherwise comply with the regulations applicable thereto. Lessee reasonably expects to cause the Equipment to be acquired by May 20, 2025.
(b) Lessee will provide evidence to Lessor that the rebate amount has been calculated and paid to the Internal Revenue Service in accordance with Section 148(f) of the Code unless (i) the entire Principal Amount is expended on the Equipment by the date that is the six-month anniversary of the Financing Documents or (ii) the Principal Amount is expended on the Equipment in accordance with the following schedule: At least fifteen percent (15%) of the Principal Amount and interest earnings thereon will be applied to the cost of the Equipment within six months from the date of issuance of the Financing Documents; at least sixty percent (60%) of the Principal Amount and interest earnings thereon will be applied to the cost of the Equipment within 12 months from the date of issuance of the Financing Documents; and one hundred percent (100%) of the Principal Amount and interest earnings thereon will be applied to the cost of the Equipment prior to eighteen (18) months from the date of issuance of the Financing Documents. (c) Lessee hereby covenants that (i) Lessee is a governmental unit with general tax powers; (ii) the Lease is not a “private activity bond” under Section 141 of the Code; (iii) at least ninety-five percent (95%) of the Principal Amount is used for the governmental activities of Lessee; and (iv) the aggregate principal amount of all tax-exempt obligations (including the Lease) issued by Lessee and its subordinate entities, if any, during the current calendar year is not reasonably expected to exceed $10,000,000. Accordingly, the rebate requirements of Section 148(f) of the Code are treated as being met, in lieu of the spending exceptions set forth in paragraph (b) above.
Section 5. Escrow Account.
The Financing Documents provide that the monies deposited in escrow shall be invested until payments to the vendor(s) or manufacturer(s) of the Equipment are due. Lessee will ensure that such investment will not result in Lessee's obligations under the Financing Documents being treated as an "arbitrage bond" within the meaning of Section 148(a) of the Internal Revenue Code of 1986, as amended (the "Code"), respectively. Any monies which are earned from the investment of these funds shall be labeled as interest earned. All such monies will be disbursed on or promptly after the date that Lessee accepts the Equipment. Lessee acknowledges that the provisions of Sections 2 and 4 herein are particularly applicable when the Principal Amount is funded into an Escrow Fund subject to the Escrow Agreement.
Section 6. No Private Use; No Consumer Loan.
6.1. Lessee will not exceed the private use restrictions set forth in Section 141 of the Code. Specifically, Lessee will not permit more than 10% of the Principal Amount to be used for a Private Business Use (as defined herein) if, in addition, the payment of more than ten percent (10%) of the Principal Amount plus interest earned thereon is, directly or indirectly, secured by (i) any interest in property used or to be used for a Private Business Use or (ii) any interest in payments in respect of such property or derived from any payment in respect of property or borrowed money used or to be used for a Private Business Use.
6.2 In addition, if both (A) more than five percent (5%) of the Principal Amount is used as described above with respect to Private Business Use and (B) more than five percent (5%) of the Principal Amount plus interest earned thereon is secured by Private Business Use property or payments as described above, then the excess over such five percent (5%) (the “Excess Private Use Portion”) will be used for a Private Business Use related to the governmental use of the Equipment. Any such Excess Private Use Portion of the Principal Amount will not exceed the portion of the Principal Amount used for the governmental use of the particular project to which such Excess Private Use Portion is related. For purposes of this paragraph 6.2, “Private Business Use” means use of bond proceeds or bond financed property directly or indirectly in a
trade or business carried on by a natural person or in any activity carried on by a person other than a natural person, excluding, however, use by a state or local governmental unit and excluding use as a member of the general public.
6.3. No part of the Principal Amount or interest earned thereon will be used, directly or indirectly, to make or finance any loans to non-governmental entities or to any governmental agencies other than Lessee.
Section 7. No Federal Guarantee.
7.1. Payment of the principal or interest due under the Financing Documents is not directly or indirectly guaranteed, in whole or in part, by the United States or an agency or instrumentality thereof.
7.2. No portion of the Principal Amount or interest earned thereon shall be (i) used in making loans the payment of principal or interest of which are to be guaranteed, in whole or in part, by the United States or any agency or instrumentality thereof, or (ii) invested, directly or indirectly, in federally insured deposits or accounts if such investment would cause the financing under the Financing Documents to be "federally guaranteed" within the meaning of Section 149(b) of the Code.
Section 8. Miscellaneous.
8.1. Lessee shall keep a complete and accurate record of all owners or assignees of the Financing Documents in form and substance satisfactory to comply with the registration requirements of Section 149(a) of the Code unless Lessor or its assignee agrees to act as Lessee's agent for such purpose.
8.2. Lessee shall maintain complete and accurate records establishing the expenditure of the Principal Amount and interest earnings thereon for a period of five (5) years after payment in full under the Financing Documents.
8.3. To the best of the undersigned’s knowledge, information and belief, the above expectations are reasonable and there are no other facts, estimates or circumstances that would materially change the expectations expressed herein.
8.4. The Lessee’s Tax Identification Number is: 95-6000675.
IN WITNESS WHEREOF, this Post-Issuance Tax Compliance Procedures Certificate has been executed on behalf of Lessee as of May 20, 2025.
CITY OF BARSTOW, as
Lessee
By: _________________________________
Name: Rochelle Clayton
Title: City Manager
[Signature Page to Post-Issuance Tax Compliance Procedures]
EXHIBIT H
ESCROW AGREEMENT
LESSOR:
Holman Capital Corporation
25231 Paseo De Alicia
Suite 105
Laguna Hills, CA 92653
ESCROW AGENT:
Mechanics Bank
1111 Civic Drive
Suite 385
Walnut Creek, CA 94596
LESSEE:
City of Barstow
220 E. Mountain View Avenue
Barstow, CA 92311
THIS ESCROW AGREEMENT (this “Escrow Agreement”) is made as of May 20, 2025, between Holman Capital Corporation (“Lessor”), the City of Barstow (“Lessee”), and Mechanics Bank (the “Escrow Agent”).
Lessor and Lessee have heretofore entered into that certain Payment Schedule No. 02 dated May 20, 2025 (the “Payment Schedule”) under that Master Equipment Lease-Purchase Agreement dated October 28, 2020 (the “Master Lease Agreement”). The Payment Schedule and Master Lease Agreement are jointly referred to herein as the “Lease.” The Lease contemplates that certain Equipment described therein (the “Equipment”) is to be acquired from the vendor(s) or manufacturer(s) thereof.
After acceptance of the Equipment by Lessee, the Equipment is to be leased by Lessor to Lessee pursuant to the terms of the Lease.
The Lease contemplates that Lessor will deposit with the Escrow Agent cash in the amount of $1,700,000.00 (the “Deposit Amount”), for deposit into the escrow fund (the “Escrow Fund”), to be held in escrow by the Escrow Agent and applied on the express terms and conditions set forth herein. Such deposit into the Escrow Fund, together with all interest and additions received with respect thereto, is to be applied from time to time to pay the vendor(s) or manufacturer(s) of the Equipment its invoice cost (a portion of which may, if required, be paid prior to final acceptance of the Equipment by Lessee). The Escrow Fund is to be held for the account and benefit of Lessee, and Lessee has granted to Lessor a first priority and perfected lien on and security interest in the Escrow Fund and any all proceeds, interest and other earnings thereon and investments therein to the Lessor by virtue of the execution of this Escrow Agreement and the Lease without the need for any additional filings or financing statements.
The parties desire to set forth the terms on which the escrow is to be created and to establish the rights and responsibilities of the parties hereto.
NOW, THEREFORE, the parties agree as follows:
1. The Escrow Agent hereby agrees to serve as escrow agent upon the terms and conditions set forth herein. The Escrow Agent agrees that the Escrow Fund shall be held irrevocably in trust for the account and benefit of Lessee and all interest earned with respect to the Escrow Fund shall accrue to the benefit of Lessee and shall be applied as expressly set forth herein.
To the limited extent required to perfect the first, priority security interest granted by Lessee to Lessor in the cash and negotiable instruments from time to time held in the Escrow Fund, Lessor hereby appoints the Escrow Agent as its security agent, and the Escrow Agent hereby accepts the appointment as security agent, and agrees to hold physical possession of such cash and negotiable instruments on behalf of Lessor.
2. On such day as determined to the mutual satisfaction of the parties pursuant to the terms of the Payment Schedule (the “Commencement Date”), Lessor shall deposit with the Escrow Agent cash in the amount of the Deposit Amount
to be held by the Escrow Agent on the express terms and conditions set forth herein. The Escrow Agent agrees to accept the deposit of the Deposit Amount by Lessor with the Escrow Agent, and further agrees to hold the amount so deposited together with all interest and other additions received with respect thereto in escrow on the express terms and conditions set forth herein.
3. The Escrow Agent shall at all times segregate the Escrow Fund into an account maintained for that express purpose, which shall be clearly identified on the books and records of the Escrow Agent as being held in its capacity as Escrow Agent. Securities and other negotiable instruments held in the Escrow Fund from time to time shall be held or registered in the name of the Escrow Agent (or its nominee). The Escrow Fund shall not, to the extent permitted by applicable law, be subject to levy or attachment or lien by or for the benefit of any creditor of any of the parties hereto (except with respect to the security interest therein held by Lessor).
4. Lessee hereby directs the Escrow Agent to invest the cash held in the Escrow Fund from time to time in an Escrow noninterest bearing demand deposit account with no fees or costs or, in the event such fund is not at the time available, such other investments as Lessee may specify in writing, to the extent the same are at the time legal for investment of the funds being invested. Interest or other amounts earned and received by the Escrow Agent with respect to the Escrow Fund shall be deposited in and become a part of the Escrow Fund. No investment shall be made that would cause the Lease to be deemed to be an arbitrage bond within the meaning of Section 148(a) of the Internal Revenue Code of 1986, as amended.
5. Lessor and Lessee hereby authorize the Escrow Agent to take the following actions with respect to the Escrow Fund:
a. From time to time, the Escrow Agent shall pay the vendor or manufacturer of the Equipment payments then due and payable, or reimburse Lessee for amounts that it has paid to the vendor or manufacturer of the Equipment, upon receipt of the following: (a) a duly executed Certificate of Acceptance and Payment Request in the form attached as Exhibit A hereto, (b) the vendor(s) or manufacturer(s) invoice(s) specifying the acquisition price of the Equipment described in the requisition request, and (c) any additional documentation required by Lessor. b. If Lessor provides to the Escrow Agent written notice of the occurrence of an Event of Default or an Event of Nonappropriation by Lessee under the Master Lease Agreement or Payment Schedule, the Escrow Agent shall thereupon promptly remit to Lessor the entire balance of the Escrow Fund. c. Upon receipt by the Escrow Agent of a duly executed Certificate of Acceptance and Payment Request identified as the final such request, the Escrow Agent shall transfer the then remaining balance of the Escrow Fund to Lessee, upon the express condition that Lessee hereby agrees to use such excess amount solely for capital expenditures as shall be approved by Lessee or, at the written direction of Lessee, for application against the interest component of the Lessee’s payment obligation under the Lease, as provided therein, unless otherwise agreed by Lessor.
6. The Escrow Agent shall have no liability for acting upon any written instruction presented by Lessee and Lessor in connection with this Escrow Agreement that the Escrow Agent in good faith believes to be genuine. Furthermore, the Escrow Agent shall not be liable for any act or omission in connection with this Escrow Agreement except for its own gross negligence, willful misconduct, or bad faith. The Escrow Agent shall not be liable for any loss or diminution in value of the Escrow Fund as a result of the investments made pursuant to Section 4.
7. To the extent authorized by law, Lessee hereby agrees to indemnify and save the Escrow Agent harmless against any liabilities that it may incur in the exercise and performance of its powers and duties hereunder and that are not due to the Escrow Agent’s gross negligence or willful misconduct. No indemnification will be made under this Section or elsewhere in this Escrow Agreement for damages arising solely out of gross negligence, willful misconduct, or bad faith by the Escrow Agent, its officers, agents, employees, successors or assigns.
8. The Escrow Agent may at any time resign by giving at least 30 days’ prior written notice to Lessee and Lessor, but such resignation shall not take effect until the appointment of the successor Escrow Agent. The substitution of another bank or trust company to act as Escrow Agent under this Escrow Agreement may occur by written agreement of Lessor
and Lessee. In addition, the Escrow Agent may be removed at any time, with or without cause, by instrument in writing executed by Lessor and Lessee. Such notice shall set forth the effective date of the removal. In the event of any resignation or removal of the Escrow Agent, a successor Escrow Agent shall be appointed by an instrument in writing executed by Lessor and Lessee. Such successor Escrow Agent shall indicate its acceptance of such appointment by an instrument in writing delivered to Lessor, Lessee and the predecessor Escrow Agent.
Upon the effective date of resignation or removal, the Escrow Agent will transfer the Escrow Fund then held by it to the successor Escrow Agent selected by Lessor and Lessee.
9. This Escrow Agreement shall terminate upon receipt by the Escrow Agent of the written notice from Lessor specified in Section 5(b) or Section 5(c) hereof.
10. All notices hereunder shall be in writing, sent by certified mail, return receipt requested, or by mutually recognized overnight carrier addressed to the other party at its respective address shown on page 1 of this Escrow Agreement or at such other address as such party shall from time to time designate in writing to the other parties; and shall be effective on the date or receipt.
11. This Escrow Agreement shall inure to the benefit of and shall be binding upon the parties hereto and their respective successors and assigns. No rights or obligations of the Escrow Agent under this Escrow Agreement may be assigned without the prior written consent of Lessor and Lessee.
12. This Escrow Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof, and no waiver, consent, modification, or change of terms hereof shall bind any party unless in writing signed by all parties.
13. The Escrow Agent may employ agents, attorneys and accountants in connection with its duties hereunder and shall not be liable for any action taken or omitted in good faith in accordance with the advice of counsel, accountants, or other skilled persons.
14. This Escrow Agreement shall be governed by and be construed and interpreted in accordance with the internal laws of the State of California.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be duly executed as of the day and year first above set forth.
LESSOR: HOLMAN CAPITAL CORPORATION
By:
Name: Lance Holman
Title: President & CEO
LESSEE: CITY OF BARSTOW
By:
Name: Rochelle Clayton
Title: City Manager
ENT: ESCROW AGENT: MECHANICS BANK
By:
Name: Nicholas Mellon
Title: SVP, Director of Commercial Banking
[Signature Page to Escrow Agreement]
EXHIBIT A TO ESCROW AGREEMENT
CERTIFICATE OF ACCEPTANCE AND PAYMENT REQUEST
The following payment request is directed to Mechanics Bank (the “Escrow Agent”), as escrow agent under that certain Escrow Agreement dated May 20, 2025 (the “Escrow Agreement”), between the City of Barstow (“Lessee”), Holman Capital Corporation (“Lessor”), and the Escrow Agent. Because Holman Capital Corporation has assigned all of its right, title, and interest in and to the Escrow Agreement to Mechanics Bank, all references herein to “Lessor” shall mean Mechanics Bank.
The Escrow Agent is hereby requested to pay from the Escrow Fund established and maintained under the Escrow Agreement the amount set forth below to the named payee(s). The amount shown is due and payable under a purchase order or contract (or has been paid by and not previously reimbursed to Lessee). The equipment described below is part or all of the Equipment leased pursuant to that certain Payment Schedule No. 02 dated May 20, 2025 (the “Payment Schedule”) executed pursuant to the Master Equipment Lease-Purchase Agreement dated October 28, 2020 (the “Master Lease Agreement”), between Lessor and Lessee:
QUANTITY
DESCRIPTION OF
UNITS OF EQUIPMENT AMOUNT PAYEE
Lessee hereby certifies and represents to and agrees with Lessor as follows with respect to the Equipment described above: (i) the Equipment has been delivered to the location(s) set forth in the Payment Schedule; (ii) a present need exists for the Equipment, which need is not temporary or expected to diminish in the near future; (iii) the Equipment is essential to and will be used by Lessee only for the purpose of performing one or more governmental functions of Lessee consistent with the permissible scope of Lessee’s authority; (iv) the estimated useful life of the Equipment based upon the manufacturer’s representations and Lessee’s projected needs is not less than the term of the Payment Schedule; (v) 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 as of the date of this Certificate; (vi) the Equipment is covered by insurance in the types and amounts required by the Master Lease Agreement; (vii) no Event of Default or Event of Nonappropriation, as those terms are defined in the Master Lease Agreement, and no event that with the giving of notice or lapse of time or both, would become an Event of Default or an Event of Nonappropriation, has occurred and is continuing on the date hereof; and (viii) sufficient funds have been appropriated by Lessee for the payment of all rental payments due under the Payment Schedule during Lessee’s current Fiscal Year.
Based on the foregoing, the Escrow Agent is hereby authorized and directed to fund the acquisition of the Equipment set forth above by paying, or causing to be paid, the manufacturer(s)/vendor(s) the amounts set forth on the attached invoices from the Escrow Fund held under the Escrow Agreement in accordance with its terms.
The following documents are attached hereto and made a part hereof: (a) Original Invoice(s) and (b) Copies of Certificate(s) of Ownership, designating Lessor as legal owner, and evidence of filing.
IF REQUEST IS FINAL REQUEST, CHECK HERE . The undersigned hereby certifies that the items of Equipment described above, together with the items of Equipment described in and accepted by Certificates of Acceptance and Payment Requests previously filed by Lessee with Lessor constitute all of the Equipment subject to the Payment Schedule.
Date: ______________
Approved:
MECHANICS BANK, as Lessor CITY OF BARSTOW, as Lessee
By: By:
Name: Name:
Title: Title:
SCHEDULE A TO ESCROW AGREEMENT:
NOTICE AND ACKNOWLEDGEMENT OF ASSIGNMENT OF ESCROW AGREEMENT Holman Capital Corporation ("Lessor"), City of Barstow ("Lessee"), and Mechanics Bank ("Escrow Agent") have entered into an Escrow Agreement dated May 20, 2025 (the "Escrow Agreement'), pursuant to which Lessor, or its Assignee (as defined below), has deposited cash into the Escrow Fund established thereunder, which funds are to be used by Lessee to acquire certain Equipment.
Escrow Agent is hereby notified that Lessor has assigned all of its right, title, and interest in and to, but not its obligations under, the Escrow Agreement to Mechanics Bank ("Assignee"), including, in particular, but without limitation, Lessor's security interest in the Escrow Fund and Lessor's right to approve all payment requests submitted by Lessee.
Date: May 20, 2025
LESSOR: HOLMAN CAPITAL CORPORATION
By:
Name: Lance Holman
Title: President & CEO
LESSEE: CITY OF BARSTOW
By:
Name: Rochelle Clayton
Title: City Manager
ESCROW AGENT: MECHANICS BANK
By:
Name: Nicholas Mellon
Title: SVP, Director of Commercial Banking
EXHIBIT I
RESOLUTION OF LESSEE
EXHIBIT J
UCC-1 FINANCING STATEMENT
EXHIBIT K
IRS FORM 8038-G
[To be prepared by Holman Capital Corporation]
EXHIBIT L
CLOSING MEMORANDUM
$1,700,000.00 LEASE FOR FIRE APPARATUS ACQUISITION PROJECT PURSUANT TO PAYMENT SCHEDULE NO. 02 ISSUED UNDER THE MASTER EQUIPMENT LEASE-PURCHASE AGREEMENT DATED OCTOBER 28, 2020 BETWEEN CITY OF BARSTOW AS LESSEE, AND
HOLMAN CAPITAL CORPORATION, AS LESSOR
Pre-Closing: Pre-Closing will be held at the Lessee’s convenience, on or before January 22, 2025. All documents will be executed and two (2) blue ink originals will be overnighted to Holman Capital Corporation, Attn.: Jane Taubman, 25231 Paseo De Alicia, Suite 105, Laguna Hills, CA 92653, for delivery no later than 9:00 am on the morning of January 22, 2025 and held in trust until such time as the wires and original documents are released by the Parties.
Closing: (1) By internal funds transfer and pending receipt of original, executed Payment Schedule and related documents, on the morning of May 20, 2025, the Investor is authorized by Lessee to transfer via internal credit the Total Equipment Cost (as set forth below) to Escrow Agent, pursuant to a general ledger credit to the Escrow Account as follows:
Bank Name: Mechanics Bank
ABA No: 121143833
Account No: <Need Number>
Account Name: City of Barstow
(2) By wire transfer and pending receipt of original, executed Payment Schedule and related documents, on the morning of May 20, 2025 the Investor is authorized by Lessee to transfer via wire the Issuance Costs (as defined below) to Lessor as follows:
Bank Name: FFB
ABA No: 121144146
Account No: XXXX1146
Account Name: Holman Capital Corporation
Holman Capital Corporation will confirm disbursement of funds to the Lessee’s escrow account and then release all of the original documents held in trust to the investor and forward a copy to the Lessee. Upon conformation by Escrow Agent of the Lease Proceeds, Lessee will wire closing costs, legal fees and other amounts to the parties in accordance with the invoices attached hereto.
Sources and Uses of Funds:
Fire Apparatus Acquisition Project $1,700,000.00
Paid from Borrower Reserves
TOTAL SOURCES $1,700,000.00
2025 Project Costs for Payment Schedule No. 02 Components $1,695,000.00 Costs of Issuance $5,000.00
TOTAL LEASE PROCEEDS $1,700,000.00
CITY OF BARSTOW,
Lessee
By: _____________________________
Name: Rochelle Clayton
Title: City Manager
[Signature Page to Closing Memorandum]