HomeMy WebLinkAboutLease Agreement 660 E Watertower Lane, Suite 250
RECORD[D"R~CUESTOf .
ADA cOUtHY RECORIJER MERIDIAN~
J. DAVID NA'It.imO A-
ZUl ;;;;"~' I' 3~ . 14;7oï'~P,U~Y262 '.
COMMERCIAL LEASE AND DEPOSIT RECEIPT
BY
CITY OF MERIDIAN
FOR
6,711 SQUARE FEET OF OFFICE SPACE
AT
660 E. W ATERTOWER LANE, SillTE 250
MERIDIAN, ill
TO
WILLIAM A. HON
P.O. BOX 190870
BOISE, ill 83719
DECEMBER 19,2000
COMMERCIAL LEASE AND DEPOSIT RECEIPT
RECEIVED FROM CitY of Meridian. a Bodv Camorate of the Smte of Idaho, hereinafter referred to as
LESSEE, the sum of $8,948.00 evidenced by check, as a deposit, which shall belong to William A. Hon,
("Lessor") and shall be applied as flJ'St month's rent.
Lessee offers to lease from Lessor the premises (the "Premises") situated in the City of Meridian,
County of Ada, State of Idaho, described as 6,711 square feefOf office space in Suite 250 of the building
located at 660 E. Watertower Lane (the "Building"), upon the following terms and conditions:
1.
TERM: The term of this' Lease will be sixty (60) monlhs commencing April I, 2001 (the
"OecupancyDate"). At any time after the Occupancy Date, within ten (10) days Lessor's request,
Lessee agrees to provide Lessor with a written acknowledgment of the Occupancy Date (lease
commencement date). Lessor agrees to allow Lessee reasonable access to the Premises prior to
the Occupancy Date to install f",lures, a computer, a telephone system and move-in furniture.
Further, Lessor agrees to allow Lessee to operate in the Premises upon completion of the tenant
improvements outlmed on Exhibit B of Ihis Agreement.
2,
RENT: Lessee hereby covenants and agrees to pay Lessor, or assigns, the total sum of Five
Hundred Seventy Thousand Four Hundred Thirty Five Dollars ($570,~135.()()) payable in monthly
installments of $8,948.00 for months One through Twelve (I - ]2), $9,227.63 for months thirteen
through twenty-four (13 - 24), $9,5()7.25 for months twenty-five Ihrough thirty.six (25-36),
$9,786,88 for months thirty-seven through forty-eight (37 - 48), and $1O,()66.50 for months forty.
nine through sixty (49 - 60), herein "Base Rent". All rents will be paid to Lessor or his/her
authorized agent, at the following address: William A. Hon. P.O. Box 190870. Boise. ill 83719,
or at such other places as may be designated by Lessor from time to time. In the event rent is not
paid within five days after due dale, Lessee agrees to pay a late ~harge of 10"/" plus interest at
18% per annum on the delmquent amount. Lessee further agrees to pay $25.00 for each
dishonored bank cbeck. The late charge period is Dot a grace period, and Lessor is entitled to
make written demand for any rent if not paid when due.
3.
OPERATING EXPENSE INCREASES: The Base Rent payable hereunder shall also be
annually adjusted upwards beginning on the first armiversary date of the tenD of this Lease, and
each year thereafter, by an amount that shall be Lessee's Proportionate Share of any increases in
tbe Operating Expenses (as thát term is defmed below) paid or payable by Lessor, or estimated to
be paid by Lessor, during the immediately preceding calender year.
As used m this Lease, the term "Operating Expenses" means:
"Real Esmte TaKes" wbich sball mean and include all general and special taxes
and assessments levied upon or assessed against the Building and the land on
which it is located (any tax levied in whole or in part in lieu of or in addition to
real property taxes);
"Operating Costs" which shall mean all reasonable costs of management,
operation, and maintenance of the Buildmg and the land on which it is situated,
including without limitation wages, salaries, and compensation of employees;
consulting, accounting, legal, janitorial, maintenance. guard, and other services;
management fees and costs; maintenance and repairs; and any other costs,
charges, and expenses that under genemlly accepted accounting principles
would be regarded as management, maintenance, and operating expenses;
"Utility Costs" which shall include the costs paid and incurred by Lessor for all
utilities in connection with the Building, including, without limitation, the costs
of heat ventilating and air conditioning, costs of furnishing gas, electricity or
other fuels or power somces, and costs of furnishing water and sewer services,
fuitia]s~
and the cost of waste disposal; and
"Lessee's Proportionate Share" rnelU1.S the percentage equal to the square
footage leas.ed to Lessee under this Lease (6,711 square feet) over the total
rentable square footage in the Building.
4.
USE: The premises are to be used for Ihe operation of governmental offices, and for no other
purpose, without prior written consent of Lessor. Lessee will not commit any waste upon the
prenrises, or any nuisance or act which may dislUrÞ Ihe quiet enjoyment of any tenant in the
building.
5.
USES PROHIBITED: Lessee will not use any portion nf the premises for purposes other than
those specified. No use will be made or permitted to be made upon the premises, nor acts done,
which will increase the existing rate of insurance upon the property, or cause cancellation of
insurance policiC3 covering the property. Lessee will not conduct or permit any sale by auction on
the premises.
6.
ASSIGNMENT AND SUBLETTING: Lessee shan have the right to sublet all or any portion of
the Premises or assign the lease at any time to an Affiliated Person of Lessee, Lessee's partner, a
.successor entlty created by merger, reorganization, recapitalization. or acquisition, without
Landlord's consent or approval. Lessee will not assign this Lease or sublet any portion of the
Premises to any other party without prior written consent of the Lessor, which will not be
unreasonably withheld. Any such assignment or sublettmg to another party without consent wíll
be void and, at Ihe option of the Lessor, will terminate this Lease. Lessee will not sublease for a
profit. If Lessee assigns or sublets, Lessee shall remain responsible for the faithful performance
and ohservance of all of its covenants and obligations set forth in the Lease.
7.
ORDINANCES AND STATUTES: Lessee will comply with all statutes. ordinances, and
requirements of all municipal, s1Rte and federal authorities now in force, or which may later be in
force, regarding the use of the premises. The commencement or pendency of any state or federal
court abatement proceeding affecting the use of the premises will, at the option of the Lessor, be
deemed a breach of this Lease.
8.
MAINTENANCE, REPAlRS, ALTERATIONS: Unless otherwise indicated, Lessee
acknowledges that the premises are in good order and repair and Lessor warrants that at the time
of occupancy the premises are in good order and repair. Lessee shall, at hisfher own expense,
maintain the interior of the premises in a good and safe condition. Lessor shall maintain all
systems and equipment, including electrical wiring, plumbing and heating and air conditioning
mstallations and repairs, and any other system or equipment. The premises will be surrendered by
Lessee, at termination of the Lease, in as good condition as received, normal wear and tear and
damage ftom casualty excepted. Lessor will be responsible for maintenance of root; exterior
walls, and structural foundations (mcluding any retrofitting required by governmental authorities).
No improvement or alteration of the premises will be made without the prior written consent of
the Lessor.
9.
ENTRY AND INSPECfION: Lessee will permdt Lessor or Lessor's agents to enter the
premises at reasonable tÎ1\Ies and upon reasonable notice for the purpose of inspecting the
premises, and wíll palmit Lessor, at any time within ninety (90) days prior to the expiration of
this Lease, to place upon the premises any usual "For Lease" signs and permit persons desiring to
lease the premises to inspect the premises at reasonable times.
10. INDEMNIFICATION OF LESSOR: Lessor will not be liable for any damage or injury to
Lessee, or any other person, or to any property, occun-Îng on the premises. Lessee agrees to hold
Lessor harmless from any claims for damages arising out of Lessee's use of the premises. and to
mdemnify Lessor for any expense mcurred by Lessor in defending any such claims.
Jnitials:¿Jt,¡ If
11. POSSESSION: If Lessor is unable to deliver the premises to Lessee for the installation ofteuant
fixtures and furniture by March I. 2001. Lessor willllðt be liable for any damage caused by the
delay, nor will this Lease be void or voidable, but Lessèe will not be liable for any rent until
possession is delivered and the tenant improvemen1S are substantially completed. Lessee may
terminate this Lease if possession of the premises is not delivered to Lessee on or before Acrill5
~
12. LESSEE'S INSURANCE: Except for such loss or damage as may be caused by the negligent or
willful act of Lessor. its agents, or employees, Lessor ahall not be liable 10 Lessee, its officers,
agents, employees, customers, invitees or third parties for loss of or damage to property, including
good, wares and merchandIse, or for injury or death to persons, in on, Or about the premises, and
Lessee agrees to indemnifÿ and save and hold Lessor harmless from and on account thereof
howsoever arising or by whomever caused. During .the term thereof, Lessee shall maintain in full
force and effect with insurance companies "A" rated or better a comprehensive liability insurance
policy, nammg Lessor as an additional insured,-applicable to the Premises and the activities of
Lessee therem with a combined single limit for bodily mjury and property damage of not less than
$1,000,000. A certificate evidencing such coverage and providing that the insurance may not be
canceled without thirty (30) days prior written notice to Landlord shall be provided to Landlord
within ten (10) days from occupancy. Lessee shall maintain in effect policies of insurance
covering ils fixtures, inventory, equipment and leasehold improvements 10ca1ed on the premises,
in an amount not less than one hundred percent (100%) of their full replacement cost, providing
protection against any peril mcIuded withm the classification Special Form Coverage, including
insurance against sprinkler damage, vandalism and malicious mischief.
13. LESSOR'S INSURANCE: Lessor will maintain hazard & liability insurance covering one
hundred percent (100%) actual replacement value of the Building throughout the Le...e term.
Lessor's insurance will not msure Lessee's personal property, leasehold improvements, or trade
fJXlures. The foregoing policy of insurance sluLll be written with rent loss endorsements in favor
of Lessor to cover a period of not less than twelve (12) months.
14. SUBROGA nON: To the maximum extent permitted by Insurance policies which may be owned
by the parties, Lessor and Lessee waive any and all rights of subrogation which might otherwise
exist.
15. UTILITIES & SERVICES: Lessor will pay for the following services to be delivered to the
premises: electricity, water, gas, sewer and trash. Lessor shaD provide janitorial services to the
Premises five days per week. Lessee shall be responsible with all other services and utilities
desired by Lessee, including but not limited to, telephone service.
16. SIGNS: Lessee, at Lessee's expense, shall be permitted to mstall signage on the front door of the
Premises. AIl signage must be approved by the Lessor prior to installation and must comply with
all applicable municipal codes. Lessor shall provide tenaDl signage on the building directory.
17. ABANDONMENT OF PREMISES: Lessee will not vacate or abandon the premises at any time
during the telTIl of this Lease. If Lessee does abandon or vacate the premises, or is dispossessed
by process of law, or otherwise, any personal property belonging to Lessee left on the premises
will be deemed to be abandoned, at 1he option of Lessor.
18. CONDEMNATION: In the event that the premises are condemned in whole or m part and the
remainder is not susceptible for use by the Lessee, this Lease will tenninate upon the date which
1he condemnor acquires possession. All sums which may be payable on account of any
condemnation wiD belong solely to the Lessor; except that Lessee will be entitled to retain any
amount awarded to himlher for his/her trade fixtures or moving expenses.
19. TRADE FIXTURES: Any and all improvements made to the premises during the tenD will
belong to the Lessor, except trade fIXtures of the Lessee. Lessee may, upon termination, remove
all hislher trade fixtures. but will pay for all costs necesslDY to repair any damage to tile premises
Initials:~-
occasioned by the removal.
ZOo DESTRUCTION OF PREMISES: In the event of a partial destruction oflhe premises during
the term, from any cause, Lessor will promptly repair the premises, provided that such repairs can
be reasonably made within sixty (60) days. Such partial destruction will not tenninate this Lease,
except that Lessee will be entitled to a proportionate reduction of rent while such repairs are being
made, based upon the extent to which the making of such repairs interferes with the business of
Lessee On the premises. If the repairs cannot be made within sbdy (60) days, this Lease may be
terminated at the option of eilher party by giving written notice 10 the other party within the sixty
(60) day period.
21. HAZARDOUS MATERIALS: Lessee will not use, store, or dispose of any hazardous
substances upon the premises, except the use and storage of such substances that are customarily
used in Lessee's business, and are in compliance with all environmental laws. Hazardous
substances means any hazardous waste, substance or toxic materials regulated under any
environmenmllaws or regulations applicable to the property. Lessee will be responsible for the
cost of removal of any toxic contamination caused by' lessee's nse of the premise. and indemnify
Lessor from any damages caused by Lessee. Notwithstanding anything to the contrary conmined
in this, Lessee shall DOt be permitted to store or sell.bottled oxygen 00 the premises.
22. INSOLVENCY: The appointment of a receiver, an assignment for the benefits of creditors, or
the filing of a petition in bankruptcy by or against Lessee, will constitute a breach of this Lease by
Lessee.
23. DEFAULT: In the event of any breach of this Lease by Lessee, Lessor may, at his/her option,
terminate the Lease and recover from Lessee: (a) the worth at the time of award of the unpaid rent
which had been earned at the time of termination; (b) the worth at the time ofaward of the amount
by which the unpaid rent which would have been earned after termination until the time of the
award exceeds the amount of such renmlloss that the Lessee proves could have been reasonably
avoided; (c) the worth at the time of award of the amount by which the unpaid rent for the balance
of the term after the time of award exceeds the amount of such rental loss that the Lessee proves
could be reasonably avoided; and (d) any other amount neeessary to compensate Lessor for all the
detrimeot proximately caused by the Lessee's milure 10 perform hisiher obligations under the
Lease or which in the ordmary course of thmgs would be likely to resu]t theretrom. Lessor may,
in the alternative, continue this Lease in effect, and Lessor may enforce aU of Lessor' s rights and
remedies, under the Lease, including Ihe right to recover the rent as it becomes due under Ihe
Leæe. Lessor may termmate Lessee's right to possession of the premises without tenninating
Ihis Lease. In such event, Lessor may retake possession of the premises and relet the premises to a
replacement tenant, in which event Lessee shall be liable for any amount by which the rent due
and payahle under this Lease exceeds rent paid by the replacement tenant, plus Lessor's costs 10
relet the premises, mcluding leasing commissions and the cost of tenant improvements. If said
breach of Lease continues, Lessor may, at any time thereafter, elect to terminate the Lease. The
remedies set forth in this section are cumulative and will not limit any other rights or remedies
which Lessor may have.
If the Lessee fails to appropriate funds as pennitted in Section 38 hereof, the remedies available to
the Lessor shall be restricted to those described above, provided that once it bas relmquished the
Project and made any payments due hereunder for its then current fiscal year, the Lessee shaD
have no further liability under this agreement.
24. OPTION TO LEASE ADJOINING SPACE: In event the adjoining space is vacant or becomes
vacant during the term of this Lease, Lessee shall have an Option to Lease the Adjoining Space
provided that this Lease remains in full force and effect, and that no default under this Lease has
occulTed. Lessor shall notify Lessee in writing upon vacation of the adjoining space. Such Option
for Adjoining Space will be granted and become effective only if exercised by written notice 1()
Lessor, and once exercised, is irrevocable. In the event Lessee fails to give such written notice to
Lessor not later than thirty (30) days following receipt of Lessor's written notice, the Option for
Initial~
Adjoining Space shall automatic¡¡]]y terminate and expire, and Lessee shall have no further right to
exercise the Option for Adjoining Space. Prior to delivery of possession, Lessee shall execute an
Amendment to this Lease reflecting the addition to the premises, the additionaL Base Rent and
Additional Rent, the change in ratio of the Premises to the Building a=, and any other revisions
necessary because of such additional space being added to the originaL Premises. AU other terms
and conditions of this Lease shan apply to the additional Premises.
25. DEPOSIT REFUNDS: The baLance of all deposits will be refunded within thirty (30) days (or
as otherwise required by law), from date possession js delivered to Lessor or hislher authorized
agent after expiration of Ihe term of this Lease, together with a statement showÙlg any charges
made against the deposits by Lessor.
26. ATTORNEY FEES: In any action or proceeding mvolving a dispute between Lessor and Lessee
arising out of this Lease, the prevailing party will be entitled to reasonable attomcyfees.
27. W AlVER: No failure of Lessor to enforce any term of this Lease will be deemed to be a waiver.
28. NOTICES: Any notice which either party may or is required to give, will be given by mailing Ihe
notice, postage prepaid, to Lessee at the premises, or to Lessor at the address shown in Item 2, or
at such oth.". places as may be designated in writmg by the parties nom time to time. Notice will
be effective five days after maUlng, or on personal delivery, or when receipt is acknowledged in
writing.
29. HOLDING OVER: Any holding over after the expiration of this Lease, with the consent of
Owner, will be a montb-to-month tenancy at a monthJy rent of one and one half (I LI2) times the
CUJTent monthly rent, payable in advance and othelWise subject to the tenns of this Lease, as
applicable, until either party will terminate the tenancy by giving the other party thirty (30) days
written notiee. .
30. TIME: Time is of the essence of this Lease.
31. HEIRS, ASSIGNS, SUCCESSORS: This Lease is binding upon and inures to the benefit of the
heirs, assigns, and successors of the parties.
32. TAXES: Lessor shall be responsible for all real property taxes assessed to the premises. Lessee
shall be responsible for any taxes assessed in connection with Lessee's property.
33. PARKING: Lessee shall be entitled to a proportionate share of the parking for the Building;
provided, Lessor reserves the right to assign aU of Lessee's parking to certain areas in the parking
lots for the Building.
34. OPTION TO RENEW: Provided that Lessee is not in default in the performance of this Lease,
Lessee will have the option to renew the Lease for !!!!£ llJ additional term(s) of mm: (2Q)
months, commencing at the expiration of the initial Lease term. All of the terms and conditions of
the Lease will apply during the renewal term, except that the monthly rent will be at the '~he,,"
market rent, which shall not be less than the rent for the previous year. The option will be
exercised by written notice given to Lessor not less than ninetY (90) days prior to the expiration of
the initial Lease term. If notice is not given within the time specified, this Option will expire.
35. LESSOR'S LIABILITY: In the event ora transfer of Lessor's title or interest to the property
during the term of thJs Lease, Lessee agrees that the grantee of such title or interest will be
substituted as the Lessor under this Lease, and the original lessor will be released of all further
liability; provided, that all deposits will be transferred to the grantee.
36. ESTOPPEL CERTIFICATE: (a) On ten (10) days' prior written notice from Lessor, Lessee
will execute, acknowledge, and deliver to Lessor a statement in writing: (1) certifying that this
Lease is unmodified and in full force and effect (or, if modified, stating the nature of such
lniljal~-
modification and certifYing that this Lease, as so modified, is in full force and effect), the amount
of any security deposit, and the date to which the rent and other charges are paid in advance, if
any; and (2) acknowledgmg that there are not, to Lessee's knowledge, any uncured defaults on the
part of Lessor, or specifYing such defaults if any are claimed. Any such sl!ltement may be
conclusively relied upon by any prospective huyer or encumbrancer of the premises. (b) At
Lessor's option, Lessee's failure to deliver such statement within such time will be a material
breach of this Lease or will be conclusive upon Lessee: (I) that this lease is in full force and
effect, without modification except as may be represented by Lessor; (2) that there are no uncured
defaults in lessor's perfonnance; and (3) that not more than one month's rent has been paid in
advance. (c) If Lessor desires to finance, refinance, or sell the premises, or any part thereof,
Lessee agrees to .deliver to any lender or buyer designated by Lessor such fmancial statements of
Lessee as may be reasonably required by such lender or buyer. All financial statements will be
received by the Lessor or the lender or buyer in confidence and will be used only for the purposes
set forth.
37. SUBORDINATION: This Lease, at Lessor's option, shall be subject and subordinate to the lien
of any mortgages or deeds of trust now or hereafter placed by Lessor on or against the premises.
Such subordination shall be automatic without the necessity of the execution and delivery of any
further instruments on the part of Lessee to effectuate such subordination; provided, however, that
so long as Lessee complies with the obligations imposed upon Lessee in this Lease, neither Lessee
nor its successors and permitted assigns (if approved by Lessor) shall be disturbed or molested in
its possession of the premises. Tenant hereby acknowledges that this Lease is subject to the
approval of Lessor's mortgagee, and agrees to execute such reasonable modifications and
amendments to this Lease as may be required as a condition to such approval or such mortgagee's
fmancing of the premises. Tenant furthere covenants and apees to execute and deliver upon
demand without charge therefor, such further instruments evidencing the subordination of this
Lease to any such mortgage or deed of trust as may be required by Lessor or prospective
purchasers or mortgagees fo the premises.
38. APPROPRIATION OF FUNDS AND RENEWAL OF AGREEMENT LEASE TERM: The
Lessee, by entering into this agreement, acknowledges its cUlTent intention to make all Lease
Payments due hereunder on the dates such Lease Payments are due (but does not commit to a legal
or other ()bligation to make such payments or to mcur any liability beyond its then current Fiscal
YOM). In the event the Lessee's governing body fails In include in its proposed budget or related
documents for the ensuing Fiscal Year or fails to appropriate sufficient funds to fully fund all of
Lessee's obligations to make Lease Payments hereunder for any future Fiscal Year, then the
Lessee will immediately notify the Lessor or its assignee of such occurrence and the Lessee's right
. to possession of any property constituting the Project, and all its interest in the Project, shall
tenninate as of September 30 oftbe Fiscal Year in whicb the failure to appropriate occurs, In such
case, the obligations of the Lessee and remedies of Lessor shall be limited as provided m Section
23. In the event that the Lessee's,goveming hody does appropriate and budget funds sufficient to
make the Lease Payments for a Fiscal Year Ihen the Lease Term of Ihis Agreement shall be
deemed renewed for such Fiscal Year. .
The Lessee agrees during the culTent Fiscal Year and during each Fiscal Year that the Lease Term
of this Agreement is renewed (i) staff of the Lessee will present for consideration by Ibe City
Council of Lessee a budget request for the ensuing Fiscal Year containing an amount sufficient to
make the Lease Payments scheduled for such Fiscal Year, (ii) that the City Council of the Lessee
shall, for the ensuing Fiscal YOM m which the Lease Payments are scheduled to be made, consider
a budget request and appropriation oflhe expendilure of an amount sufficient to allow Lessee to
make all Lease Payments due in such Fiscal Year; (iii) that, to the extent funds have been
appropriated for the current Fiscal Year, it will make all such Lease Payments; and (iv) that if
sufficient funds are appropriated and budgeted by it for the next Fiscal Year for the lease of the
Pr()ject, then Ibe Lease Term of this Agreement shall be deemed renewed for sucb Fiscal Year and
shall be effective for such Fiscal Year.
Initial~-
Nothing in 1his Section or elsewbere in this Agreement shall be deemed in any way to obligate the
Lessee beyond its cwrent Fiscal Year. If the Lessee fails or refuses to renew the Lease Term of
this Agreement for the next Fiscal Year as pennitted above, makes any payment due for the then
current FiscaJ Year ftom funds budgeted and appropriated for that purpose and relinquishes the
Project as provided in Section 23 hereof. Then Lessee &haJl have no further liability under this
Agreement.
39. SPECIAL PROVISIONS: AdditionaJ provisions are set forth in Exhibit A, attached bereto.
40. ENTIRE AGREEMENT: The foregoing cOlliItitutes the entire agreement between the parties
and may be modified only in writing signed by aJl parties. The following exhibits are a part of this
Lease:
Exbibit A: SDeciaJ Provisions: Owner's Shell and Buildin~ Standard Tenant Imorovements.
Exhibit B: Premises .Floor Plan
ffiiliar!qll-
The undersigned Lessee acknowledges Ihat it has thoroughly read and approved each of 1he provisions
contained m Ihis Lease, and agrees to the terms and conditions specified, and acknowledges receipt of a
copy hereof.
ACCEPTANCE
Lessor: William A. Hon
By:rJãJ~C~ ~
Date: t'L(M(oa
~-
By: ;iû ~
. orne
Do< hl;/~
/
Its:
[ts:
Ci Clerk
~ff7'=' V\£ . pC
InitiaJd!L~
EXHIBIT A
660 E. WATERTOWER LANE
OWNER'S SHELL AND BUILDING STANDARD TENANT IMPROVEMENTS
I. CORE IMPROVEMENTS TO BE PERFORMED BY OWNER
The following i~ a description of the construction work provided by the Owner.
A.
Owner's Shell Core Stneture
1.
Structure. The OWller shall con~truct all of the structural walls, floor slab, and roof of
the building, together with all finished exterior surface~, parking, landscaping and
other exterior improvements.
2.
Interior Construction - The Owner shall construct all mechanical rooms which serve
the structure as a whole.
B.
Core Meehanical
The Owner shall install roof mounted package HV AC units.
c.
Core Eleetrical
The Owner shall provide complete electrical to all exterior areas including TeDJInt sign
illumination, the main switchgear and meter panels.
D.
Core Plumbing
The Owner shall supply restrooms to conform willi Unifonn building code for specific
building use.
E. Core CommunieatioDli
The Owner shall supply access to a central communications room for the Tenant's
communications carrier. Terminal communication panels relating specifically to the Tenant's
premises shall be located outside of the common communications room, and inside the
useablo area of the Tenant's premises only ¡frequired by Tenant.
F.
Core FIre Sprinklers
Owner shall provide fIre sprinkler risers, alanus, lines and one set of heads above the ceiling
lino.
G.
Core Entranl'e and Glazing
The Owner shall provide all exterior glazing which shall be I" insulated glass with solar
grade tinting.
H.
Hardware
Entrance Deadbolt: Commercial grade locks.
11.
BUILDING STANDARD TENANT IMPROVEMENTS TO BE PERFORMED BY OWNER
Initia1~-
ON BEHALF OF TENANT
A.
Space Planning
The Owner's architect shall do all space planning unless olherwise provided for in the Lease
or otherwise agreed w by the Owner and Tenant in writing.
B.
Building Permitg for Tenant Improvements
The Owner shall obtain from the governmental entities having jurisdiction tbe Building
Permits required for the constructicn/instaIlation of the Tenant improvements within the
Tenant's premises. The cost of all building and other pennits for Tenant's use shall be part of
the Owner's con1ributicn to Building Standard Tenant Improvements.
c.
Tenant Demising won.
Tenant demising walls between leased spaces, shall have (i' studs at 16" on center with 518"
type 'X' gypsum wallboard on each side. Fill cavity with R-19 Insulation. Extend wall to
underside of roof structure and scribe to fit around obstructions.
D.
Interior Partition Walls:
Shall be proyjded as shown on attached floor plan with 3-1/2" studs at 16" cn center with
5/8" gypsum wallboard WI each side. Extend wall to the underside of tbe suspended ceiling
with a ccmpressible gasket s1rip and four-way wire bracing and strut per UBC Standard 25-2
for seismic brace. Acoustical sealant to be applied under base plates. Finish to be exposed
gypsum board surfaces.
E.
Interior Tenallt Doors
Doors, fi'ames and hardware shall be provided as shown on the attached floor plan. Interior
doors shall be 3' by 7' by 1-114, solid core, pamt grade with hollow metal ÍÌ'ames. Interior
doors, unless pre-finished, shall be primed and finished with two coats of semi-gloss enamel
paint.
F.
Interior Wall Finishes
Interior fmishes in Ihe office areas shall be gypsum wallboard witb light spray teKture, one
coat of primer and one coat of finish to cover. Partition wans and interior wall assemblies in
office areas shall be finished with 4" vinyl base.
G.
Hardware
Interior partitions shan be furnished with Kwikset passage locks or equal.
Hardware fmish to be US26D or equaL
H.
Interior Woodwork:
Maple wood window sills and skirts.
L
Interior Glazing:
Not Included in Building Standard Tenant Improvements.
J.
Floor Covering
Floor covering to be selected by Tenant shall be Building Standard 26 oz. Commercial
Carpet with 3/8" felt pad and tack strip application ($15.00 per sq. yd. allowance) in office
InitialS~
111.
areas.
K.
Ceilings
Office ceiImgs shall have T.Bar ceilings with Building Standard 2'x4' 'USG Fissured SLT
ceiling tiles with DONN DX 151l6" grid or approved equal. White finish (050) on both tile
and grid.
L.
Cabinets and Coffee Bar
Owner wilt provide coffee bars with sinks and lower cabinets as shown on the attached floor
plan. Coffee bars to have laminated plastic tops. Cabinets to be building standard plastic
laminate.
M.
Ceiling Fixtures
One 2'x4' lay-in, florescent lube fixture for every 80 sq. It. of useable area within the
Tenant's premises.
N.
Electrical Distribution
1.
Two duplex wall outlets m each office area withm Ihe Tenant's premises.
2,
Single pole light switch: one per 250 sq. ft. of useable office area of withm the Tenant's
premises.
3.
4,
Battery powered emergency light per code.
Building exit light per code.
5.
Phone data outlet: one per ]50 sq. ft of useable office area within the Tenant's premises.
Phone data wiring is not part of the BuiIdmg Standard Tenant Improvements.
O.
Fire Sprinklers and Protection System
1.15 sprinkler heads are allowed for each 144 sq. ft. of use able office area within the Tenant's
premises. One 5. lb. wal] mounted fire extinguisher as required.
P.
HVAC
Standard multi-zone heating and cooling, adequate for nonnal office with one standard
. thennostat per zone. Building Standard Tenant Improvements shall include air distribution,
with the necessary connections to make the systems operable.
Q. Window Treatment:
Horizontal wood blinds.
TENANT IMPROVEMENTS TO BE COMPLETED AT TENANT EXPENSE
A,
'Eleetric Fixtures and Equipment: All electric fixtures and equipment not included above.
B.
Gas Conneetlons: An gas connections within Tenant's space not included above.
C. Telephone: All conduits for telephone wires or comp\lter netWorks from the central building
panel to the leased premises and m the leased premises. Tenant shall make all arrangements for
telephone service.
InitialsJtUi-
D.
Walls: All special wall covering, glass partitions, or other special construction withm the
leased area.
E.
Coves and Ceilings: All special coves and ceilings.
F.
Furniture and Fixtures: All cabinets, woodwork, fixtures ;md equipment not furnished by
Owner.
G.
Floor Coverings: All floor coverings above the allow;mce.
H.
Painting: Extra colors or special paint
I.
Alarm Systems: All alarm systems or other protective devices.
J.
Special PlumbiDg: AI! extra plumbing or fiXtures required for temmt's special needs.
K.
Special Veøtilation: AU ventilation and related equipment, other than standard air
conditioninglheating in office space.
L.
Hot Water Heater: Except as required for Ihe toilet rooms and coffee bar sÍXIk (if included.)
M.
Electric Floor Outlels.
N.
Signs: Sign and insta1lation of sign (copy and design subject to Owners approval).
O.
All architects' fees above allowance, special licensing fees and city or county pennits for
interior of Tenant's space.
P.
ACHD fees above busmess park rates.
!nitjal~-
EXHIBIT B
PREMISES FLOOR PLAN
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SECOND AMENDMENT TO LEASE
This Second Amendment to Lease, made and entered into November --' 2004 by and between
William A. Hon Family Limited Partnership, an individual (hereinafter "Lessor") and the City of
Meridian, a Body Corporate of the State ofIdaho (hereinafter "Lessee").
WITNESSETH:
WHEREAS, Lessor's predecessor in interest, William A. Hon, and Lessee entered into a lease dated
December 19, 2000, (hereinafter "Lease"), under the terms of which Lessee leased general office
space as defined in the Lease (hereinafter the "Premises") at 660 East Watertower Lane, Meridian,
Idaho (hereinafter the "Building");
WHEREAS, Lessor and Lessee amended said Lease on May 8, 2003 to expand the premises.
WHEREAS, Lessor and Lessee have agreed to further expand Lessee's existing premises and to
extend the term of said Lease per the terms stated herein.
WHEREAS, Lessor and Lessee upon the execution of this Second Amendment to Lease hereby
mutually amend the Lease under the terms and conditions hereinafter set forth:
NOW THEREFORE, in consideration of the mutual covenants herein contained, and other good
and valùable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties
agree as follows:
Premises: Lessee shall lease additional space within the Building.
per the Lease shall be expanded as follows:
The Demised Premises leased
Suite Number Previous Reutable Exoanded Rentable
Square Feet Square Feet
202 5,987 3,371 RSF
150 2,564 ORSF
Total Rentable Square Feet 8,551 11,922 RSF
1.
Commencement Base Rent for Expansion Space: The commencement of Base Rent for the
Expansion Space portion of the Lease shall begin December 1, 2004.
Lessee's Pro Rata Share: Lessee's Pro Rata Share as defined in Section 3 of the Lease
Agreement shall be 63.28%.
Tenant Improvements: Lessor shall improve the Expansion Space as per a mutually
acceptable space plan and specifications to be signed by both Lessor and Lessee prior to
construction.
Delivery of Premises: Lessee's occupancy of the added premises shall be deemed by Lessor
2.
3.
4.
as acceptance of the added premises condition by Lessee.
Rent: Lessee hereby covenants and agrees to pay Lessor, or assigns the following monthly rent:
Period:
Total Monthly Rent:
Dec. 1, 2004-March31, 2005
$16,751,21
April 1, 2005 - March 31, 2006
$17,247.96
April 1, 2007 - March 31, 2007
$17,744.71
Term: The term of the lease shall be extended to March 31,2007.
In the event of a conflict between the terms of the Lease and this Second Amendment to Lease, the
terms of this Second Amendment to Lease shall control. Except as expressly modified by this Second
Amendment to Lease, the Lease shall remain unchanged and in full force and effect. This Second
Amendment to Lease shall not be modified or amended except in writing, signed by the parties hereto.
Notwithstanding the foregoing, Section 38 of the Lease is ratified and affirmed as applicable to this
Amendment.
[End of text]
IN WITNESS WHEREOF, we have set our hands the day and year first above written.
L.essor: William A. Hon Family Limited Partnership
By:
Date:
William A. Hon
Its:
General Partner
Lessee: City of Meridian
By:
Date:
Tammy de Weerd
Its:
Mayor
2
By:
Its:
William G. Berg Jr.
City Clerk
Date:
3
City of Meridian
660 Watertower Lane
Lease Breakdown
12/1/04 - 3131/05
Suite #: RSF: Mo. Lease Annual Lease: $/RSF
150 2,564 $3,525.50 $42,306.00 $16.50
202 (existing) 5,987 $8,731.04 $104,772.50 $17.50
202 (expansion) 3.371 $4.494.67 $53.936.00 $16.00
11,922 $16,751.21 $201,014.50 $16.86
4/1105 - 3/31/06
Suite #: RSF: Mo. Lease Annual Lease: $/RSF
150 2,564 $3,632.33 $43,588.00 $17.00
202 (existing) 5,987 $8,980.50 $107,766.00 $18.00
202 (expansion) 3371 $4.635.13 $55.621.50 $16.50
11,922 $17,247.96 $206,975.50 $17.36
4/1/06 - 3/31/fY1
Suite #: RSF: Mo. Lease Annual Lease: $/RSF
150 2,564 $3,739.17 $44,870.00 $17.50
202 (existing) 5,987 $9,229.96 $110,759.50 $18.50
202 (expansion) 3.371 $4.775.58 $57.307.00 $17.00
11,922 $17,744.71 $212,936.50 $17.86
1l/24/Z004
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GREAT AMERICAN INSURANCE COMPANIES
Subsidiaries of American Financial Corporation L0182966
CM 78 68
580 WALNUT STREET, CINCINNATI, OHIO 45202 ( Ed . 07 99 )
Policy No . IMP 185 - 11 -32 - 00
BUILDERS RISK PLUS
TIME ELEMENT COVERAGE SUPPLEMENTAL DECLARATIONS
NAMED INSURED:
CITY OF MERIDAN POLICY PERIOD:
10/ 18 /2001 to 10/ 18 /2002
Insurance under Time Element Coverage applies to only those Coverages shown
by ( X ) below.
COVERAGES
( X ) 1 . "Soft Costs "
( X ) a . Interest on money borrowed to finance construction ( including
costs which directly result from renegotiation of construc -
tion loan ( s ) ) ,
( ) b . Advertising and promotional expenses .
( ) c . Realty taxes and other assessments ; license and percent fees .
( X ) d . Architectural or Engineering Supervisory or consulting fees .
( 1 e . Costs resulting from the renegotiation of your lease ( s ) .
( ) f .
( ) 2 . "Rental Value"
LIMIT OF INSURANCE :
The most we will pay for your amount of loss under this endorsement is :
1 . $ 300 , 000 for "Soft Costs "
2 . $ for "Rental Value"
DEDUCTIBLE : ( X ) $ 5 ,000 ( ► days
Locations Covered :
( X ) All jobsites described in the Builders Risk Plus Declarations
OR
( ) The following jobsite only :
Words and phrases that appear in quotation marks have special meaning . Refer
to Section F . , DEFINITIONS, of this endorsement and of your Builders Risk Plus
Coverage Form.
The following terms and conditions apply , in addition to all terms
and conditions ( except the Coinsurance , and Deductible provisions ) of your
Builders Risk Plus Coverage Form.
BUILDERS RISK PLUS ( Reg . U . S . Pat . Off . )
CM 78 68 ( Ed . 07/99 ) PRO ( Page 1 of 6 )
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0182966
A. COVERAGE
1 . "Soft Costs "
When indicated by an " X " in the applicable parentheses of your
Time Element Coverage Supplemental Declarations , we will pay your
"soft costs " during the "period of delay in completion . " Such
"soft costs " must result from " loss" from a Covered Cause of Loss
which delays the completion of the "project " beyound the "planned
completion date . "
Our payment for your "soft costs " is subject to the terms and
conditions of this endorsement . Also , the amount we pay for items
b . , d . , or f . ( shown in the Supplemental Declarations ) won ' t be
more than your actual expense for each of these items prior to the
" loss . "
2 . "Rental Value"
When indicated by an " X " in the applicable parentheses of your
Time Element Coverage Supplemental Declarations , we will pay the
amount by which your " rental value" is actually reduced during the
"period of delay in completion . " Such reduction in " rental value"
must result from " loss " from Covered Cause of Loss which delays
the completion of the "project " beyond the "planned completion
date . "
But if your Builders ' Risk Plus policy was endorsed to permit
occupancy and the building or structure was occupied for its
intended purpose at the time of " loss , " we will pay the amount by
which your " rental value" is actually reduced during the
"post - loss period of construction . "
4 . Additional Coverages
a . Expense to Reduce the "Loss Amount "
We will pay the necessary expense you incur during the
"post - loss period of construction" if you would not have
incurred such expense had there not been " loss" from any of
the Covered Causes of Loss which delayed the completion of the
"project " beyond the "planned completion date . " But we will
not pay more for your expense than the amount by which such
expense reduces the " loss amount " we would have otherwise paid
under this endorsement .
b . Civil Authority
We will pay the " loss amount " incurred by you during the first
two consecutive weeks after the "planned completion date" when
a civil authority prohibits access to your " jobsite . " The
denied access must result from " loss " by a Covered Cause of
Loss to property at a location other than the jobsite
described in your Time Element Coverage Supplemental
Declarations .
CM 78 68 ( Ed . 07/99 ) PRO ( Page 2 of 6 )
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0182966
B . EXCLUSIONS
We will not pay for the " loss amount " that is directly or indirectly
due to an increase in the "post - loss period of construction" caused by
any of the following . Such " loss amount " is excluded regardless of any
other cause or event that contributes concurrently or in any sequence
to the following :
1 . Interference by strikers or other persons affecting the :
a . construction or repair of the Covered Property ; or
b . operation or use of the "project " if your Builders Risk Plus
policy is endorsed to permit occupancy , and the building or
structure was occupied for its intended purpose at the time of
" loss . "
2 . Irregularities in production , shipment or transportation of any
property to be used in the construction or repair of the Covered
Property .
3 . Suspension , lapse or cancellation of any lease , permit , license ,
contract or order .
4 . Breach of contract , late or noncompliance with orders or penalties
of any nature .
5 . Weather conditions .
6 . Deficiencies in the original construction designs , specifications
or materials .
7 . Enforcement of any law that :
a . regulates the construction , use or repair , or requires the
tearing down of any property ;
b . requires any Insured or others to test for , monitor , clean up ,
remove , contain , treat , detoxify or neutralize or in any way
respond to or assess the effects of "pollutants . "
8 . Lack of funds or lack of work force .
C. LIMITS OF INSURANCE
The most we will pay for the " loss amount " incurred by you is the
Limit of Insurance shown in the Time Element Coverage Supplemental
Declarations .
Any payment made under this endorsement is in addition to the
applicable Limits of Insurance shown elsewhere in this policy .
CM 78 68 ( Ed . 07/99 ) PRO ( Page 3 of 6 )
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0182966
D. DEDUCTIBLE
We will pay the amount of the adjusted " loss " in excess of the
Deductible amounts shown in the Declarations , up to the applicable
Limit of Insurance .
This deductible does not apply to insurance afforded under Section
A. 4 . , Additional Coverages .
E . ADDITIONAL CONDITIONS
1 . Your Duties in the Event of "Loss "
You must do the following in the event of " loss " to Covered
Property :
a . Make every effort to meet the "planned completion date . " This
includes , but is not limited to :
( 1 ) resumption of , as soon as possible , all or any part of the
construction or repair ;
(2 ) use of any machinery , equipment , supplies or materials
that could reduce the "period of delay in completion" ; and
(3 ) resumption of , as soon as possible , the operation or use
of any part of the "project , " if your Builders ' Risk Plus
policy states that permission to occupy is granted , and
the building or structure was occupied for its intended
purpose at the time of " loss . "
If you do not make every effort to meet the "planned
completion date , " or you do not resume the operation or use of
any part of the "project " as soon as possible , we will only
pay the " loss amount " that we would have otherwise paid if you
had complied with the above conditions .
b . Notify us of any payment you receive from others due to a
delay in the completion of construction beyond the "planned
completion date . "
2 . Determining the "Loss Amount "
The " loss amount " will be determined based on :
a . your actual and anticipated costs for the project had " loss "
from any of the Covered Causes of Loss not occurred ;
b . Either :
( 1 ) your likely " rental value" during the "period of delay in
completion" had " loss " from any of the Covered Causes of
Loss not occurred ; or
CM 78 68 ( Ed . 07 /99 ) PRO ( Page 4 of 6 )
1
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0182966
Administrative Offices IL 70 01 ( Ed . 05 92)
580 Walnut Street
GREAT ERwAN. Cincinnati,OH 45202 Policy No . IMP 1 8 5 - 1 1 -3 2 - 00
INSURANCE GROUP 513.369.5000 ph Renewal O f
BUS INESSPRO® POLICY COMMON DECLARATIONS
NAMED INSURED CITY OF MERIDAN
AND ADDRESS : 33 E IDAHO
MERIDAN , ID 83642
IN RETURN FOR PAYMENT OF THE AGENT 'S NAME AND ADDRESS:
PREMIUM, AND SUBJECT TO ALL SWETT INSURANCE MGRS OF IDAHO
TERMS OF THIS POLICY, WE AGREE
WITH YOU TO PROVIDE THE INSURANCE 9196 W BARNES DR
AS STATED IN THIS POLICY. BOISE , ID 83709 1552
Insurance is afforded by the Company named below, a Capital Stock Corporation :
GREAT AMERICAN INSURANCE COMPANY OF NEW YORK
POLICY PERIOD: From 10/ 18 /2001 To 10 / 18 /2002
12 : 01 A.M. Standard Time at the address of the Named Insured
This policy consists of the following Coverage Parts for which a premium is
indicated . This premium may be subject to adjustment .
Premium
Commercial Property
Commercial General Liability
Commercial Crime
Commercial Inland Marine $4 , 600 . 00
Commercial Equipment Breakdown
Commercial Auto
Commercial Umbrella
Broker Fee: $100.00 TOTAL $4 , 600 . 00
FORMS AND ENDORSEMENTS applicable POLICY ALTERNATE MAILING ADDRESS:
to all Coverage Parts and made part
of this Policy at time of issue are
listed on the attached Forms and
Endorsements Schedule IL8801 11 /85 .
Countersigned i 111410 l By
Date Authorized Representative
F.8972C (9/01)
IL 70 01 ( Ed . 05 /92 ) PRO ( Page 1 of 1 ) SECIKAW
C * I6*11 /01 /O1 * IMP1851132 -00 ORIGINAL COPY
0182966
Administrative Offices
580 Walnut Street IL 88 01 ( E d .1 1 /85 )
GREATCincinnati, Ohio 45202
AMERICAN, Tel: 1 513 369 5000
INSURANCE COMPANIES PoI icy : IMP 1 8 5 - 1 1 -3 2 00
BUSINESSPRO FORMS AND ENDORSEMENTS SCHEDULE
It is hereby understood and agreed the following forms and endorsements are
attached to and are a part of this policy :
Date Added*
or
Form and Edition Date Deleted Form Description
1 . IL0017 11 /98 COMMON POLICY CONDITIONS
2 . IL0204 04/98 IDAHO CHGS-CANCELLATION/NONRENEWAL
3 . IL7001 05 /92 COMMON DECLARATIONS
* IF NOT AT INCEPTION
IL 88 01 11 /85 ( Page 1 of 1 )
C * I6*11 /01 /01 * IMP1851132 -00 ORIGINAL COPY
0182966
[GREAT AMERICAN INSURANCE COMPANIES OA
Subsidiaries of American Financial Corporation
580 WALNUT STREET, CINCINNATI, OHIO 45202 IL 02 04
(Ed. 04 98)
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
IDAHO CHANGES - CANCELLATION AND NONRENEWAL
This endorsement modifies insurance provided under the following:
BOILER AND MACHINERY COVERAGE PART
BUSINESSOWNERS POLICY
COMMERCIAL AUTO COVERAGE PART
COMMERCIAL CRIME COVERAGE PART
COMMERCIAL GENERAL LIABILITY COVERAGE PART
COMMERCIAL INLAND MARINE COVERAGE PART
COMMERCIAL PROPERTY COVERAGE PART
EMPLOYMENT-RELATED PRACTICES LIABILITY COVERAGE PART
FARM COVERAGE PART
LIQUOR LIABILITY COVERAGE PART
POLLUTION LIABILITY COVERAGE PART
PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART
PROFESSIONAL LIABILITY COVERAGE PART
A. Paragraphs 1. and 2. of the CANCELLATION b. More than 60 days
Common Policy Condition are replaced by the
following:
If this policy has been in effect for
1. The first Named Insured shown in the more than 60 days, or is a renewal of
Declarations may cancel this policy by a policy we issued, we may cancel this
mailing or delivering to us advance written policy only for one or more of the
notice of cancellation. Cancellation will be following reasons:
effective on the later of the date request-
ed by the first Named Insured or the date (1) nonpayment of premium;
we receive the request.
2. POLICIES IN EFFECT (2) fraud or material misrepresenta-
tion made by you or with your
knowledge in obtaining the policy,
a. 60 days or less continuing the policy or in pre-
senting a claim under the policy;
If this policy has been in effect for 60
days or less, we may cancel this policy
by mailing or delivering to the first (3) acts or omissions on your part
Named Insured written notice of can- which increase any hazard insured
cellation at least against,
(1) 10 days before the effective date (4) changes in the risk which materi-
of cancellation if we cancel for ally increases the risk of loss
nonpayment of premium; or after the policy has been issued
or renewed including, but not
(2) 30 days before the effective date limited to, an increase in exposure
of cancellation if we cancel for due to regulation, legislation or
any other reason. court decision;
Copyright, Insurance Services Office, Inc., 1997
IL 02 04 (Ed. 04/98) XS (Page 1 of 2)
C * 16*11 /01 /01 * IMP185113ORIGINAL COPY
0182966
(5) loss of or decrease in reinsur- a. we have offered to renew this policy;
ance which provided us with
coverage for all or part of the b. you have obtained replacement cov-
risk insured;
erage; or
(6) a determination by the Director of c. you have agreed in writing to obtain
Insurance that continuation of this
replacement coverage.
policy would jeopardize our sol- 5. If notice is mailed, proof of mailing will be
vency or place us in violation of sufficient proof of notice.
the insurance laws of Idaho or
any other state; or C. The following Condition is added:
(7) violation or breach by the Insured PREMIUM OR COVERAGE CHANGES AT RE-
of any policy terms or conditions NEWAL
other than nonpayment of pre-
mium. 1. If we elect to renew this policy, we will
mail or deliver written notice of any total
We will mail or deliver written premium increase greater than ten(10%)
notice of cancellation to the first which is the result of a comparable in-
Named Insured at least crease in premium rats, change in deduct-
ible, reduction in limits or reduction in
(a) 10 days before the effective
coverage to the first Named Insured, at
date of cancellation if we
the last mailing address known to us.
cancel for nonpayment of
premium; or 2. Any such notice will be mailed or deliv-
ered(b) 30 days before the effective to the first Named Insured at least 30
days before the expiration or anniversary
date of cancellation if we date of the policy.
cancel for any other reason
stated in 2.b. above. 3. If notice is not mailed or delivered at least
30 days before the expiration or anniver-
B. The following Condition is added and super- sary date of the policy, the premium, de-
sedes any provision to the contrary: ductible, limits and coverage in effect pri-
or to the changes will remain in effect
NONRENEWAL until the earlier of the following:
1. If we elect not to renew this policy, we a. 30 days after notice is given; or
will mail or deliver to the first Named In-
sured a written notice of intention not to b. the effective date of replacement
renew at least 45 days prior to the ex- coverage obtained by the first Named
piration or anniversary date of the policy. Insured.
2. We will mail or deliver our notice to the 4. If the first Named Insured accepts the re-
first Named Insured's last mailing address newal, the premium increase, if any, and
known to us. other changes will be effective on and
after the first day of the renewal term.
3. If notice is not mailed or delivered at least
45 days before the expiration or anniver- 5. If the first Named Insured elects not to
sary date of this policy, this policy will renew, any earned premium for the re-
remain in effect until 45 days after notice suiting extended period of coverage will
is mailed or delivered. Earned premium for be calculated pro rata at the lower of the
the extended period of coverage will be new rates or rates applicable to the expir-
calculated pro rata at the rates applicable ing policy.
to the expiring policy.
6. If notice is mailed, proof of mailing will be
4. We need not mail or deliver this notice if: sufficient proof of notice.
Copyright, Insurance Services Office, Inc., 1997
IL 02 04 (Ed. 04/98) XS (Page 2 of 2)
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0182966
IL 00 17
(Ed. 11 98)
COMMON POLICY CONDITIONS
All Coverage Parts included in this policy are subject to the following conditions.
A. CANCELLATION consent. This policy's terms can be amended
or waived only by endorsement issued by us
1. The first Named Insured shown in the and made part of this policy.
Declarations may cancel this policy by
mailing or delivering to us advance written C. EXAMINATION OF YOUR BOOKS AND
notice of cancellation. RECORDS
2. We may cancel this policy by mailing or We may examine and audit your books and
delivering to the first Named Insured writ- records as they relate to this policy at any
ten notice of cancellation at least time during the policy period and up to three
years afterward.
a. 10 days before the effective date of
cancellation if we cancel for nonpay- D. INSPECTIONS AND SURVEYS
ment of premium; or
1. We have the right to:
b. 30 days before the effective date of
cancellation if we cancel for any other a. make inspections and surveys at any
reason. time;
3. We will mail or deliver our notice to the b. give you reports on the conditions we
first Named Insured's last mailing address find; and
known to us.
c. recommend changes.
4. Notice of cancellation will state the effec-
tive date of cancellation. The policy period 2. We are not obligated to make any inspec-
will end on that date. tions, surveys, reports or recommenda-
tions and any such actions we do under-
5. If this policy is cancelled, we will send the take relate only to insurability and the pre-
first Named Insured any premium refund miums to be charged. We do not make
due. If we cancel, the refund will be pro safety inspections. We do not undertake
rata If the first Named Insured cancels, to perform the duty of any person or
the refund may be less than pro rata. The organization to provide for the health or
cancellation will be effective even if we safety of workers or the public. And we
have not made or offered a refund. do not warrant that conditions:
6. If notice is mailed, proof of mailing will be a. are safe or healthful; or
sufficient proof of notice. b. comply with laws, regulations, codes
B. CHANGES or standards.
3. Paragraphs 1. and 2. of this condition
This policy contains all the agreements be- apply not only to us, but also to any
tween you and us concerning the insurance rating, advisory, rate service or similar
afforded. The first Named Insured shown in organization which makes insurance
the Declarations is authorized to make inspections, surveys, reports or rec-
changes in the terms of this policy with our ommendations.
Copyright, Insurance Services Office, Inc. 1998
IL 0017 (Ed. 11/98) XS (Page 1 of 2)
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0182966
4. Paragraph 2. of this condition does not F. TRANSFER OF YOUR RIGHTS AND DUTIES
apply to any inspections, surveys, reports UNDER THIS POLICY
or recommendations we may make relative
to certification, under state or municipal Your rights and duties under this policy may
statutes, ordinances or regulations, of not be transferred without our written con-
boilers, pressure vessels or elevators. sent except in the case of death of an in-
dividual Named Insured.
E. PREMIUMS
The first Named Insured shown in the Dec- If you die, your rights and duties will be
larations: transferred to your legal representative but
only while acting within the scope of duties as
1. is responsible for the payment of all pre- your legal representative. Until your legal re-
miums; and presentative is appointed, anyone having
proper temporary custody of your property
2. will be the payee for any return premiums will have your rights and duties but only with
we pay. respect to that property.
IN WITNESS WHEREOF, we have caused this policy to be executed and attested, and, if required by
state law, this policy shall not be valid unless countersigned by our authorized representative.
0442AA/Lt auGig%r-oft;$14144211M
Secretary President
Copyright, Insurance Services Office, Inc. 1998
IL 0017 (Ed. 11/98) XS (Page 2 of 2)
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Administratiye Offices
580 Walnut street CM 88 01 ( Ed . 1 1 /85 )
GREAT Cincinnati, Ohio 45202
AATERKAN. Tel: 1 513-369-5000
INSURANCE COMPANIES Policy : IMP 1 8 5 - 1 1 -3 2 00
BUSINESSPRO FORMS AND ENDORSEMENTS SCHEDULE
It is hereby understood and agreed the following forms and endorsements are
attached to and are a part of this policy :
Date Added*
or
Form and Edition Date Deleted Form Description
1 . CM0001 09/00 COMMON INLAND MARINE CONDITIONS
2 . CM7840 07 /99 BUILDER 'S RISK PLUS DECLARATIONS
3 . CM7841 07 /99 BUILDER 'S RISK PLUS COVERAGE FORM
4 . CM7868 07/99 BR PLUS TIME ELEMENT COV SUPPL DEC
5 . CM7879 10/92 KREIZENBECK CONSTRUCTORS , INC .
6 . CM7879 10/92 WELLS FARGO BANK NW NA
* IF NOT AT INCEPTION
CM 88 01 11 /85 ( Page 1 of 1 )
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CM 00 01
(Ed. 09 00)
COMMERCIAL INLAND MARINE CONDITIONS
The following conditions apply in addition to the Common Policy Conditions and applicable Additional
Conditions in Commercial Inland Marine Coverage Forms:
LOSS CONDITIONS 4. Take all reasonable steps to protect the
Covered Property from further damage,
A. Abandonment and keep a record of your expenses nec-
essary to protect the Covered Property,
There can be no abandonment of any property for consideration in the settlement of the
to us. claim. This will not increase the Limit of
Insurance. However, we will not pay for
B. Appraisal any subsequent loss or damage resulting
from a cause of loss that is not a Covered
If we and you disagree on the value of the Cause of Loss. Also, if feasible, set the
property or the amount of loss, either may damaged property aside and in the best
make written demand for an appraisal of the possible order for examination.
loss. In this event, each party will select a
competent and impartial appraiser. The two 5. You will not, except at your own cost,
appraisers will select an umpire. If they cannot voluntarily make a payment, assume any
agree, either may request that selection be obligation, or incur any expense without
made by a judge of a court having jurisdiction. our consent.
The appraisers will state separately the value 6. As often as may be reasonably required,
of the property and amount of loss. If they permit us to inspect the property proving
fail to agree, they will submit their differences the loss or damage and examine your
to the umpire. A decision agreed to by any
two will be binding. Each party will: books and records.
1. pay its chosen appraiser; and Also permit us to take samples of damag-
ed and undamaged property for inspec-
tion, testing and analysis, and permit us to
2. bear the other expenses of the appraisal
and umpire equally. make copies from your books and
records.
If there is an appraisal, we will still retain our 7. We may examine any Insured under oath,
right to deny the claim. while not in the presence of any other
Insured and at such times as may be rea-
C. Duties In The Event Of Loss sonably required, about any matter relating
to this insurance or the claim, including an
You must see that the following are done in Insured's books and records. In the event
the event of loss or damage to Covered of an examination, an Insured's answers
Property: must be signed.
1. Notify the police if a law may have been 8. Send us a signed, sworn proof of loss
broken. containing the information we request to
settle the claim. You must do this within
2. Give us prompt notice of the loss or 60 days after our request We will supply
damage. Include a description of the you with the necessary forms.
property involved.
9. Immediately send us copies of any de-
3. As soon as possible, give us a description mands, notices, summonses or legal pa-
of how, when and where the loss or dam- pers received in connection with the claim
age occurred. or suit
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10. Cooperate with us in the investigation or 2. If there is other insurance covering the
settlement of the claim. same loss or damage, other than that de-
scribed in 1. above, we will pay only for
D. Insurance Under Two Or More Coverages the amount of covered loss or damage in
excess of the amount due from that other
If two or more of this policy's coverages insurance, whether you can collect on it or
apply to the same loss or damage, we will not not. But we will not pay more than the
pay more than the actual amount of the loss applicable Limit of Insurance.
or damage.
G. Pair, Sets Or Parts
E. Loss Payment 1. Pair or Set
1. We will give notice of our intentions In case of loss or damage to any part of a
within 30 days after we receive the sworn pair or set we may:
proof of loss.
a. repair or replace any part to restore
2. We will not pay you more than your fi- the pair or set to its value before the
nancial interest in the Covered Property. loss or damage; or
3. We may adjust losses with the owners of b. pay the difference between the value
lost or damaged property if other than of the pair or set before and after the
you. If we pay the owners, such payments loss or damage.
will satisfy your claim against us for the
owners' property. We will not pay the 2. Parts
owners more than their financial interest in
the Covered Property. In case of loss or damage to any part of
Covered Property consisting of several
4. We may elect to defend you against suits parts when complete, we will only pay for
arising from claims of owners of prop- the value of the lost or damaged part.
erty. We will do this at our expense.
H. Recovered Property
5. We will pay for covered loss or damage If either you or we recover any property
within 30 days after we receive the sworn after loss settlement, that party must give the
proof of loss if you have complied with
all the terms of this Coverage Part and: other prompt notice. At your option, the
property will be returned to you. You must
a. we have reached agreement with you then return to us the amount we paid to you
on the amount of the loss; or for the property. We will pay recovery ex-
penses and the expenses to repair the recov-
b. an appraisal award has been made. ered property, subject to the Limit of Insur-
ance.
6. We will not be liable for any part of a loss I. Reinstatement Of Limit After Loss
that has been paid or made good by oth-
ers. The Limit of Insurance will not be reduced by
the payment of any claim, except for total
F. Other Insurance loss or damage of a scheduled item, in which
event we will refund the unearned premium on
1. You may have other insurance subject to that item.
the same plan, terms, conditions and pro-
visions as the insurance under this Cov- J. Transfer Of Rights Of Recovery Against
erage Part. If you do, we will pay our Others To Us
share of the covered loss or damage. Our
share is the proportion that the applicable If any person or organization to or for whom
Limit of Insurance under this Coverage we make payment under this Coverage Part
Part bears to the Limits of Insurance of all has rights to recover damages from another,
insurance covering on the same basis. those rights are transferred to us to the ex-
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tent of our payment. That person or organiza- C. Legal Action Against Us
tion must do everything necessary to secure
our rights and must do nothing after loss to No one may bring a legal action against us
impair them. But you may waive your rights under this Coverage Part unless:
against another party in writing:
1. there has been full compliance with all the
1. Prior to a loss to your Covered Property.
terms of this Coverage Part; and
2. After a loss to your Covered Property
only if, at time of loss, that party is one of 2. the action is brought within 2 years after
the following: you first have knowledge of the direct
loss or damage.
a. someone insured by this insurance; or
b. a business firm: D. No Benefit To Bailee
(1) owned or controlled by you; or No person or organization, other than you,
having custody of Coverage Property will
(2) that owns or controls you. benefit from this insurance.
This will not restrict your insurance.
E. Policy Period
GENERAL CONDITIONS
We cover loss or damage commencing:
A. Concealment, Misrepresentation Or Fraud
1. during the policy period shown in the
This Coverage Part is void in any case of Declarations; and
fraud, intentional concealment or misrepre-
sentation of a material fact, by you or any
other Insured, at any time, concerning: 2. within the coverage territory.
1. this Coverage Part; F. Valuation
2. the Covered Property; The value of property will be the least of the
3. your interest in the Covered Property; or following amounts:
4. a claim under this Coverage Part. 1. the actual cash value of that property;
B. Control Of Property 2. the cost of reasonably restoring that
Any act or neglect of any person other than property to its condition immediately be-
you beyond your direction or control will not fore loss or damage; or
affect this insurance.
3. the cost of replacing that property with
The breach of any condition of this Coverage substantially identical property.
Part at any one or more locations will not
affect coverage at any location where, at the In the event of loss or damage, the value of
time of los or damage, the breach of con- property will be determined as of the time of
dition does not exist loss or damage.
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Administrative Offices
5so walnut street CM 78 40 ( Ed .07/99 )
GREAT Cincinnati, Ohio 45202
AMERICAN Tel: 1 V-369 5000
INSURANCE COMPANIES Policy: IMP 1 8 5 - 1 1 -3 2 00
BUILDERS RISK PLUS DECLARATIONS
NAMED INSURED: POLICY PERIOD
CITY OF MERIDAN 10/ 18 /2001 to 10/ 18 /2002
PREMIUM FOR THIS COVERAGE FORM: $ 4 , 600
MINIMUM PREMIUM: $
SECTION A:
1 . LIMITS OF INSURANCE :
Coverage is provided only if a Limit of Insurance is shown . The most we
will pay for " loss " is :
$ 3 , 200 ,000 at any one construction jobsite location
$ 100, 000 while in transit
$ 3 , 200 ,000 in any one " loss "
2 . COVERAGE EXTENSIONS:
$ 5 , 000 pollutant clean up and removal
$ 1 ,000 loss data preparation
Debris Removal :
25 % of direct physical " loss " amount
$ 100 , 000 additional limit if direct physical " loss " and debris
removal expense exceed Limit of Insurance
SECTION B :
ADDITIONAL COVERAGES:
The following coverages are provided in addition to the above Limits of
Insurance .
$ 100 , 000 for temporary structures
$ 25 ,000 for temporary locations
$ 100 ,000 for forms , scaffolding , falsework and temporary fences
$ 100 ,000 for removal expense
$ 5 ,000 for fire department service charges
$ 5 ,000 per occurrence /$500 per item for lawn , trees , shrubs and/or
plants
SECTION C:
OPTIONAL COVERAGES :
Coverage is provided only if a Limit of Insurance is shown . If a Limit of
Insurance is shown , coverage is provided in addition to the Limits of
Insurance provided in Section A. , except for Equipment Breakdown and
Ordinance or Law, Undamaged Portion of Building , where coverage is
included in the Section A. Limit of Insurance .
BUILDERS RISK PLUS (Reg . U.S . Pat . Off . )
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M Administrative Offices
580 Walnut Street CM 78 40 ( Ed .07/99 )
GREAT/Am Cincinnati, Ohi(2501g°
45202
AMERICAN, Tel: t-513-369-5000
INSURANCE COMPANIES
Policy : IMP 1 8 5 - 1 1 -3 2 00
BUILDERS RISK PLUS DECLARATIONS
No Optional Coverages Selected
SECTION D:
DEDUCTIBLE :
The deductible amount is $ 5 , 000 , or ( ) See endorsement attached
SECTION E :
DESCRIPTION AND LOCATION OF COVERED CONSTRUCTION JOBSITE(S) IN THE COURSE OF
CONSTRUCTION OR INSTALLATION:
INA OF LAW ENDFORCEMENT COMPLEX, 1401 E . WATERTOWER DR .
ERIDIAN , ID 83642 , BLOCK AND STEEL CONSTRUCTION .
SECTION F :
REPORTING BASIS:
( X ) Non Reporting ( ) Adjustable Premium ( see endorsement attached )
( ) "Completed Value" Monthly Reporting ( see endorsement attached )
FORMS AND ENDORSEMENTS applicable to all Coverage Parts and made a part of
this policy at time of issue are listed on the attached Forms and
Endorsements Schedule CM 88 01 ( 11 /85 ) .
BUILDERS RISK PLUS (Reg . U. S . Pat . Off . )
CM 78 40 07/99 (Page 2 of 2 )
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(2 ) your likely " rental value" during the "post - loss period of
construction" had " loss " from any of the Covered Causes of
Loss not occurred , if your Builders ' Risk Plus policy
states that permission to occupy is granted , and the
building was occupied for its intended purpose at the time
of " loss . "
c . your actual " rental value" before " loss " from any of the
Covered Causes of Loss occurred , if your Builders ' Risk Plus
policy states that permission to occupy is granted , and the
building was occupied for its intended purpose at the time of
" loss " ;
d . other relevent sources of information that you must provide
including , but not limited to :
( 1 ) your financial records and accounting procedures ;
(2 ) bills , invoices and other vouchers ; and
(3 ) deeds , liens and contracts .
e . any amounts by which the " loss amount " is reduced due to your
failure to perform Your Duties in the Event of Loss outlined
in this policy .
3 . Liquidated Damages
If the construction contract for the "project " contains a clause
that requires payments to you because of a delay in the completion
of the "project " beyond the "planned completion date , " we will
subtract the amount due from others , whether you have collected it
or not , from the "amount of loss " we would have otherwise paid .
F . DEFINITIONS
"Loss Amount" means the sum of your actual "soft costs " or " rental
value , " as covered by this endorsement .
"Period of delay in completion" means the period of time that :
a . begins with the "planned completion date" ; and
b . ends on the date when the "project " should be completed using
reasonable speed and similar materials and workmanship .
"Planed completion date" means the date the "project " would be put
into operation or use in the normal course of construction if " loss "
from any of the Covered Causes of Loss had not occurred .
"Post - loss period of construction" means the period of time that :
a . begins with the date of the " loss " by any Covered Cause of Loss ;
and
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b . ends on the date the "project " should be completed using
reasonable speed and similar materials and workmanship .
"Project " means the total construction of all Covered Property at the
jobsite or described in the Time Element Supplemental Declarations .
"Rental value" means the sum of :
a . the total rental income from the tenant occupancy of the completed
"project , " as furnished and equipped by you ;
b . the amount of all charges which are the legal obligation of the
tenant ( s ) and which would otherwise be your obligations ; and
c . the fair rental value of any portion of the completed "project "
which would have been occupied by you .
But Rental Value does not include normal operating expenses which are
discontinued as a result of a " loss . "
"Soft costs" means your actual and necessary costs in excess of your
actual and anticipated amount for the "project " consisting only of the
following for which an " X " appears in the applicable parentheses of
your Time Element Coverage Supplemental Declarations :
a . interest on money borrowed to finance construction of the Covered
Property ( including costs which directly result from renegotiation
of construction loan ( s ) eg . Loan committment fees , including
prepaid interest and points ) ;
b . advertising and promotional expenses ;
c . realty taxes and other assessments , license and permit fees ;
d . architectural or engineering supervisory or consulting fees ;
e . costs resulting from renegotiating your teasels ) including :
( 1 ) legal , accounting and administration fees ;
( 2 ) commissions .
f . other as specified in the Time Element Coverage Supplemental
Declarations .
Other Terms Remain The Same
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GREAT AMERICAN INSURANCE COMPANIES 8
Subsidiaries of American Financial Corporation
580 WALNUT STREET, CINCINNATI, OHIO 45202 CM 78 41
al (Ed. 07 99)
BUILDERS RISK PLUS COVERAGE FORM
Various provisions of this policy restrict coverage. Read the entire policy carefully to determine rights,
duties, and what is or is not covered.
Throughout this policy the words "you" and "your" refer to the Named Insured shown in the Declarations.
The words "we," "us" and "our" refer to the company providing this insurance.
Other words and phrases that appear in quotation marks have special meaning. Refer to SECTION G -
DEFINITIONS.
A. COVERAGE e. contractor's equipment, aircraft, motor
vehicles, watercraft, machinery, tools
We will pay for direct "loss" to Covered or similar property which will not be-
Property from any of the Covered Causes of come a permanent part of the struc-
Loss. tures) at the jobsite described in the
Declarations;
1. Covered Property, as used in this Cov-
erage Form, means: f. bridges, tunnels, piers, wharves and
dams whether or not in the course of
a. your property and property for which construction, reconstruction, renova-
you are legally responsible consisting tion or repair;
of: building materials and supplies,
equipment, machinery and fixtures; g. buildings or structures that exist prior
to any alteration, addition, improve-
b. fences, foundations, excavations, un- ment, renovation or repair.
derground pipes, drains, paving, and/or
pilings at any construction jobsite 3. Covered Causes of Loss
covered by this Coverage Form;
Covered Causes of Loss means risks of
which is, or is intended to become a per- direct physical "loss" to Covered Property
manent part of the structure(s) at the job- except those causes of "loss" listed in the
site(s) described in the Declarations. Exclusions. 1
2. Property Not Covered 4. Additional Coverages
Covered Property does not include: Additional Coverages, as described below,
apply per location and are in addition to
the Limit of Insurance located on Section
a. water, land (including land on which the A of the Declarations Page.
property is located), grading or fill;
a. We will pay up to the Limit of Insur-
b. contraband or property in the course ance shown in Section B. of the Dec-
of illegal transportation or trade; larations for "loss" from a Covered
Cause to Temporary Structures while
c. growing crops; located at a construction jobsite de-
scribed in the Declarations. This insur-
d. accounts, bills, currency, deeds, evi- ance applies as excess of any other
dences of debt, money, notes or se- insurance that would apply for your
curities; benefit.
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This property will be valued at the e. We will pay up to the Limit of Insur-
lesser of: ance shown in Section B. of the Dec-
larations for your liability for Fire De-
(1) its actual cash value; or partment Service Charges when the
fire department is called to save or
(2) the amount for which you are le- protect Covered Property from a
gaily liable, if the property is not Covered Cause of Loss. This coverage
owned by you. is provided when your liability is:
b. We will pay for "loss" to Covered (1) assumed by contract or agree-
Property from a Covered Cause while ment prior to "loss"; or
it is at Temporary Locations, but only
for the first 180 days that the prop- (2) required by local ordinance.
erty is located there, and not beyond
the end of the policy period. f. We will pay up to the Limit of Insur-
ance shown in Section B. of the Dec-
The most we will pay for any one larations for "loss" to Lawns, Trees,
"loss" at a Temporary Location is the Shrubs and Plants if the "loss" is caus-
Limit of Insurance shown in Section B. ed by fire, lightning, explosion, air-
of the Declarations. craft, civil disturbance or riot. The
c. We will payupto the Limit of Insur- most we will pay for any one lawn,
tree, shrub or plant including removal,
ance shown in Section B. of the Dec- is $500.
larations for "loss" from a Covered
Cause to Scaffolding, Construction The coinsurance provision of your policy
Forms, Falsework, and Temporary does not apply to these Additional Cov-
Fences while they are located at a erages.
construction jobsite described in the
Declarations. This insurance applies as 5. Coverage Extensions
excess of any other insurance that
would apply for your benefit.
a. Debris Removal
This property will be valued at the
lesser of: We will pay your actual and necessary
expense to remove debris of Covered
(1) its actual cash value; or Property caused by or resulting from a
Covered Cause of Loss.
(2) the amount for which you are le-
gally liable, if the property is not The most we will pay for "loss" under
owned by you. this Coverage Extension is the per-
centage shown on the Declarations
d. We will pay up to the Limit of Insur- which is the sum of the amount we
ance shown in Section B. of the Dec- pay for direct physical "loss" to Cov-
larations for your actual, necessary ered Property plus the applicable de-
Expense to Remove Covered Property ductible amount.
from a location covered by this insur-
ance, if removal is necessary to avoid If the sum of debris removal expense,
imminent "loss" from a Covered Cause. deductible amount and our payment
We will insure such Covered Property for direct physical "loss" exceeds the
at the location to which it has been applicable Limit of Insurance, we will
removed for safekeeping, for a period pay up to the limit shown in the Dec-
up to 30 days. Also, we will insure larations for additional debris removal
such Covered Property while in transit expense.
via truck or rail between the original
covered locations and the safekeeping This Coverage Extension doesn't apply
location. to the cost to:
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But we will payfor acts of destruction
(1) extract "pollutants" from land or ordered by governmental authority and
water; or
taken at the time of a fire to prevent
(2) remove, restore or replace pol- its spread if the fire would be covered
luted land or water. under this Coverage Form.
b. Pollutant Clean Up and Removal b. Nuclear Hazard
We will pay your necessary expense (1) Any weapon employing atomic
to extract "pollutants" from land or fission or fusion; or
water at a jobsite if the release, dis-
charge or dispersal of the "pollutants" (2) nuclear reaction or radiation, or
results from a Covered Cause of Loss radioactive contamination from
to Covered Property that occurs dur- any other cause. But we will pay
ing the policy period. Your expenses for direct "loss" caused by re-
will be paid only if they are reported suiting fire if the fire would be
to us within 180 days of the earlier of: covered under this Coverage
Form.
(1) the date of the "loss"; or
c. War and Military Action
(2) the end of the policy period.
(1) War, including undeclared or civil
The most we will pay under this Cov- war;
erage Extension is the limit shown in
the Declarations for the sum of all
such expenses for each separate poli- (2) warlike action by a military force,
cy period up to 12 months. including action in hindering or
defending against an actual or ex-
The limit of Pollutant Clean Up and Re- pected attack, by any govern-
moval is separate from the Limits of ment, sovereign or authority using
Insurance stated elsewhere in the poli- military personnel or other
cy. agents; or
c. Loss Data Preparation (3) insurrection, rebellion, revolution,
usurped power or action taken by
We will pay up to the limit shown in governmental authority in hinder-
the Declarations for your actual cost ing or defending against any of
of preparing a statement of loss or these.
any other exhibits required in connec-
tion with any claim under this Coy- d. Earth Movement
erage Form.
(1) Any earth movement (other than
B. EXCLUSIONS "sinkhole collapse") such as earth-
quake, landslide, mine subsidence
1. We will not pay for a "loss" caused di- or earth sinking, rising, shifting,
rectly or indirectly by any of the follow- expanding, contracting or any
ing. Such "loss" is excluded regardless of other earth movement. But if loss
any other cause or event that contributes or damage by fire, theft, or ex-
concurrently or in any sequence to the plosion results, we will pay for
"loss." that resulting "loss."
a. Governmental Action (2) Volcanic eruption, explosion or
effusion. But if "loss" by fire or
Seizure or destruction of property by volcanic action results, we will
order of governmental authority. pay for that resulting "loss."
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III
Volcanic action means direct But if "loss" by fire, explosion, theft or
"loss" resulting from the eruption sprinkler leakage results, we will pay
of a volcano when the "loss" is for that resulting "loss."
caused by: f. Building Ordinance
(a) airborne volcanic blast or The enforcement of any ordinance or
airborne shock waves; law:
(b) ash, dust or particulate mat-
ter; or (1) regulating the construction, use
or repair of any property; or
(c) lava flow.
(2) requiring the tearing down of any
All volcanic eruptions that occur property, including the cost of
within any 168 hour period will removing its debris.
constitute a single occurrence.
2. We will not pay for a "loss" caused by or
Volcanic action does not include resulting from any of the following:
the cost to remove ash, dust or
particulate matter that does not a. Delay, loss of use, loss of market or
cause direct physical "loss" to the any other consequential loss.
described property.
e. Water b. Dishonest acts by:
(1) flood, surface water, waves, (1) you, your partners, officers or
tides, tidal waves, overflow of trustees, employees or your or
any body of water, or their spray, their authorized representatives;
all whether driven by wind or not.
(2) anyone else with an interest in the
(2) mudslide or mudf low; property, or their employees or
authorized representatives;
(3) water that backs up from a sewer
or drain; or
(3) anyone else (other than a carrier
(4) water under the ground surface for hire) to whom you entrust e
property.
pressing on, or flowing or seep- property.
ing through:
This exclusion applies whether or not
(a) foundations, walls, floors or such persons are acting alone or in
paved surfaces; collusion with other persons, or such
acts occur during the hours of em-
(b) basements, whether paved ployment.
or not; or
c. Rain, sleet, snow, hail, ice or dust to
(c) doors, windows or other property in the open. This exclusion
openings. does not apply to property in the cus-
tody of a carrier for hire, nor "loss"
(5) water damage as a result of
freezing, unless: due to collapse of a structure caused
by weight of rain, sleet, snow, hail, ice
(a) you have shut off the water or dust
supply and drained the
plumbing systems; or d. Unexplained loss, mysterious disap-
pearances or shortage disclosed upon
(b) made a reasonable effort to taking inventory. This exclusion does
maintain heat in an enclosed not apply to a carrier for hire or a
building. public warehouseman.
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•
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3. We will not pay for a "loss" caused by or But if as a result of (a) or (b) above there
resulting from any of the following. But if is "loss" to other Covered Property by a
"loss" by a Covered Cause of Loss results, Covered Cause of Loss, we will pay for
we will pay for that resulting "loss." that resulting "loss."
a. Collapse or weather conditions. But 5. We will not pay for:
this exclusion only applies if weather
conditions or collapse contribute in
any way with a cause or event ex- a. Penalties for noncompletion or non-
cluded in paragraph 1. above to pro- compliance with contract conditions.
duce the "loss."
b. Any "loss" covered under any guar-
b. Acts or decisions, including the failure antee, warranty or other expressed or
to act or decide, of any person, group, implied obligation of any contractor,
organization or governmental body. manufacturer or supplier. This exclu-
c. Faulty, inadequate or defective: sion applies whether or not such con-
tractor, manufacturer or supplier is a
(1) planning, zoning, development, Named Insured.
surveying, siting;
C. LIMITS OF INSURANCE
(2) design, specifications, workman-
ship, repair, construction, renova-
tion, remodeling, grading, corn- The most we will pay for "loss" due to Cov-
paction; ered Causes of Loss is the applicable Limit of
Insurance shown in the Declarations. The Lim-
(3) materials used in repair, con- its of Insurance applicable to Additional Con-
struction, renovation or remodel- erages and Optional Coverages are in addition
ing; or to the Limits of Insurance, unless stated oth-
erwise.
(4) maintenance.
d. Gradual deterioration, hidden or latent D. DEDUCTIBLE
defects, any quality in the property
that causes it to damage or destroy We will pay the amount of the adjusted "loss"
itself, wear and tear, depreciation, in excess of the Deductible amount shown in
corrosion, rust, mold, rot, dampness the Declarations, up to the applicable Limit of
or dryness, cold or heat, insects, ro- Insurance.
dents, birds or other animals.
e. Settling, cracking, shrinking, bulging or E. ADDITIONAL CONDITIONS
expansion of the earth, foundations,
footings or structures. The following conditions apply in addition to
the Commercial Inland Marine Conditions and
4. We will not pay for "loss" caused by or Common Policy Conditions.
resulting from:
a. Artificially generated electric current 1. Coinsurance
that creates a short circuit or other
electric disturbance within electrical Covered Property, (except property at
devices, appliances or wires. But we temporary storage locations or in transit),
will pay for direct "loss" caused by must be insured for its total "completed
resulting fire if the fire would be coy- value" at the time of loss or you will incur
ered under this Coverage Form. a penalty. The penalty is that we will pay
only the proportion of any "loss" that the
b. Mechanical breakdown of machinery applicable Limit of Insurance shown in the
including rupture or bursting caused by Declarations bears to the total "completed
centrifugal force. value" of Covered Property.
CM 78 41 (Ed. 07/99) XS (Page 5 of 11)
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0182966 •
2. Valuation (i) fault, defect, error or omis-
sion in such design, speci-
General Condition E. Valuation in the Corn- fications, or plans;
mercial Inland Marine Conditions is re-
placed by the following: (ii) performance of, or failure
to perform, supervisory or
a. Building or Structure management functions relat-
ed to the construction pro-
We will adjust a "loss" to buildings or ject(s).
structures on the basis of replacement
cost, at the time of loss, including the (2) Any contractor, manufacturer or
contractor's reasonable overhead and supplier of Covered Property that
profit has agreed to make good any loss
or damage under a guarantee or
b. Other Covered Property warranty.
We will adjust "loss" to: If any act or agreement of yours im-
pairs our right to recover for "loss" as
(1) owned property at the actual cash described above, we will not cover the
value, including labor and delivery "loss."
charges; b. We will not cover any "loss" which you
settle or compromise without our
(2) property of others at the cost to written consent
repair or replace but not more
than the amount for which you 4. Cancellation
are legally liable.
The following is added to Common Poli-
Property will be valued as of the time the cy Conditions, paragraph 5: If the first
"loss" occurs. Named Insured cancels this policy, we will
retain at least the Minimum Premium
The most we will pay is: amount shown in the Declarations.
(1) the amount necessary to repair the 5. Where Coverage Applies
Covered Property; or
Coverage applies while Covered Property
(2) the amount necessary to replace the is:
Covered Property with materials of
the same kind or quality; or a. at the construction jobsite premises
described in the Declarations; or
(3) the applicable Limit of Insurance; b. in transit by truck or railroad,
whichever is less. all while within the United States (excluding
3. transit to and from Alaska; to and from
Duty to Preserve Rights of Recovery
Hawaii), the District of Columbia, or
a. Before a "loss" you may waive your Canada
rights of recovery against any individ- 6. When Coverage Begins and Ends
ual, corporation or other entity except
We cover from the time the Covered
(1) any architect, engineer, or other Property is at your risk starting on or
party or entity responsible for after the date this policy begins.
any design, specifications, or
plans for the fabrication, erection This coverage will end on each structure
or completion of the property in- when any of the following occurs:
sured with respect to any loss or
damage that may be caused by: a. the purchaser accepts it;
CM 78 41 (Ed. 07/99) XS (Page 6 of 11)
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0182966
b. your interest in the Covered Property (c) explosion of steam boilers,
ceases; or you abandon the construc- steam piping, steam engines
tion; or steam turbines.
c. 90 days after the structure is "sub- If an initial Accident causes other Ac-
stantially completed" (if no work on cidents, all will be considered one Ac-
the structure has taken place during cident. All Accidents that are the result
that period); of the same event will be considered
one Accident
d. when a structure is occupied or put to
its intended use, without our written (2) The following additional cover-
consent; ages also apply to "loss" caused
by or resulting from an Accident
e. any other insurance covers the prop-
erty as a completed building or struc- (a) Expediting Expenses
ture;
With respect to your
f. this Coverage Form is cancelled; or damaged Covered Property,
we will pay up to $25,000
g. the end of the policy period. for your reasonable extra
expenses to:
F. OPTIONAL COVERAGES
(i) make temporary re-
Coverage under this section is provided only pairs; and
if a Limit of Insurance for the coverage se- (ii) expedite permanent re-
lected appears in the Declarations. The coy- pairs or replacement
erage limits selected apply per location, and
are in addition to the Limit of Insurance, ex- (b) Hazardous Substances
cept for Equipment Breakdown where cov-
erage is included in the Section A. Limit of We will pay for the addi-
Insurance. If there is no separate deductible tional costs, up to $5,000, to
indicated, the policy deductible will apply to repair or replace Covered
these optional coverages. Property because of con-
tamination by a hazardous
1. Equipment Breakdown substance. This includes the
additional expenses to clean
a. Coverage up or dispose of such prop-
erty.
(1) We will pay for "loss" caused by
or resulting from Accident to Hazardous Substances means
"Covered Equipment". As used in any substance other than
this Coverage Form, an Accident ammonia that has been de-
means direct physical "loss" as Glared to be hazardous to
follows: health by a government
agency. Additional Costs
(a) mechanical breakdown of mean those beyond that
machinery including rupture which would have been re-
or bursting caused by cen- quired had no hazardous
trifugal force; substance been involved.
(b) artificially generated electric (3) As respects this Optional Con-
current that creates a short erage, Section B. EXCLUSIONS is
circuit or other electric dis- amended as follows:
turbance within electrical
devices, appliances or wires; (a) Paragraph 4. is deleted in its
or entirety.
CM 78 41 (Ed. 07/99) XS (Page 7 of 11)
1
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0182966 • •
(b) The following exclusion is tions, or to the address where
added: the equipment is located. Once
suspended in this way, your in-
We will not pay under this surance can be reinstated only by
Coverage Form for "loss" written notice from us. If we
caused by or resulting from suspend your insurance, you will
any of the following: get a pro rata refund of premium.
But the suspension will be effec-
(i) the breakdown of any tive even if we have not yet made
structure, foundation, or offered a refund
cabinet, compartment
or air-supported struc- (5) As respects this Optional Cou-
ture or building; erage, the following definitions
(ii) the breakdown of any are added to Section G. DEFINI-
insulating or refractory TIONS:
material;
"Covered Equipment" means Coy-
(iii) the breakdown of any ered property including fired or
sewer piping; any un- unfired pressure vessels built to
derground vessels or operate under vacuum or pres-
piping; any piping for- sure, other than weight of con-
ming a part of a sprin- tents, or used for the generation,
kler system; or any wa- transmission or utilization of en-
ter piping other than ergy. However, "Covered Equip-
boiler feed water pip- ment" does not include "Produc-
ing, boiler condensate tion Machinery".
return piping or water
piping forming a part of "Production Machinery" means any
a refrigerating or air machine or apparatus, including
conditioning system; or any cylinder containing a movable
plunger or piston, that processes
(iv) the explosion of gases or produces a product intended
or fuel within the fur- for eventual sale.
nace of any fired vessel
or within the flues or 2. Plans and Records
passages through which
the gases of combus-
tion pass. We will pay up to the Limit of Insurance
shown in Section C. of the Declarations to
(4) As respects this Optional Coy- reproduce, replace or restore valuable
erage, the following condition is papers or records (such as blueprints,
added to Section E. ADDITIONAL plans, drawings, or data processing media)
CONDITIONS: located at any construction premises cov-
ered by this Optional Coverage.
Suspension
The Coinsurance Additional Condition of
When any "Covered Equipment" is your policy does not apply to valuable pa-
found to be in, or exposed to a pers and records.
dangerous condition, any of our
representatives may immediately 3. Fire Protection Equipment
suspend the insurance against
loss from an Accident to that We will pay your:
equipment. We can do this by
mailing or delivering a written no- a. "loss" to your fire protection equip-
tice of suspension to your ad- ment from a Covered Cause of Loss;
dress as shown in the Declara- and
CM 78 41 (Ed. 07/99) XS (Page 8 of 11)
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0182966
b. actual expense to recharge such 6. Flood Coverage
equipment which was discharged while
fighting a fire at, or while in transit to, a. Coverage
a construction jobsite described in the
Declarations. Coverage added by this Optional Cov-
erage applies only to locations which
The most we will pay for this Optional are not within the flood plain as deter-
Coverage is the Limit of Insurance shown mined by the Federal Emergency Man-
in Section C. of the Declarations for the agement Agency and identified in Sec-
sum of the "loss" and expense coverage tion C. of the Declarations.
provided.
(1) Covered Causes of Loss include:
The Coinsurance Additional Condition of
your policy does not apply to fire protec- (i) Flood meaning a general and
tion equipment temporary condition of par-
tial or complete inundation
4. Inflation Protection of normally dry land area
from inland or tidal waters.
We will pay up to the Limit of Insurance
shown in Section C. of the Declarations (ii) Tsunami meaning a large
for your actual increased cost of labor wave caused by earthquake
and/or substantially identical materials to or volcanic eruption.
repair or replace Covered Property lost or
damaged by a Covered Cause of Loss. (iii) Release of water impounded
by a dam.
We will pay this additional amount only: (2) Limit of Insurance
a. if the jobsite limit is insufficient at the The most we will pay for water
time of loss, but was in compliance damage from a Covered Cause of
with the Coinsurance condition when Loss in any one "loss" is the Limit
coverage began; and of Insurance or sublimit shown in
Section C. of the Declarations.
b. to the extent that the increase in cost
is the direct result of inflation of your (3) Deductible
costs and not changes in the job.
As respects your claim for "loss"
This coverage does not apply to, and we to Covered Property caused by
will not pay to rebuild, any structure that perils listed in subparagraph (1)
existed before the construction job in- above, we will pay the amount of
sured by this policy began, even if coy- the adjusted "loss" in excess of
erage for "loss" to such structure is pro- the applicable deductible up to
vided by endorsement to the Coverage the applicable Limit of Insurance.
Form.
7. Earthquake Coverage
5. Extra Expense
a. Coverage
We will pay up to the Limit of Insurance
shown in Section C. of the Declarations Coverage added by this Optional Cov-
f or your actual, necessary, additional ex- erage includes:
pense to continue normal construction
operations at a construction jobsite de- 1. Earthquake; and
scribed in the Declarations, which is in-
curred as a direct result of a "loss" to 2. Volcanic Eruption, meaning the
Covered Property from a Covered Cause eruption, explosion, or effusion
of Loss, at such jobsite. of a volcano.
CM 78 41 (Ed. 07/99) XS (Page 9 of 11)
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0182966
All Earthquake shocks or Volcanic that which flows, leaks or
Eruptions that occur within any seeps on or into Covered
168 hour period will constitute a Property), mudslide or mud-
single Earthquake or Volcanic flow, release of water im-
Eruption. The expiration of this pounded by a dam, even if
policy will not reduce the 168 attributable to an Earthquake
hour period. or Volcanic Eruption.
b. Limit of Insurance (b) Any Earthquake or Volcanic
Eruption that begins before
The limit of insurance is shown in the inception of this insur-
Section C. of the Declarations Page ance.
and is the most we will pay for loss
caused by an Earthquake or Volcanic (c) Earth movement other than
Eruption. Earthquake, such as landslide
or earth sinking, rising or
shifting. But if loss or dam-
c. Deductible age by another Covered
Cause of Loss results, we
1. As respects your claim for "loss" will pay for that resulting
to Covered Property caused by loss.
Earthquake or Volcanic Eruption, (d) The cost to remove volcanic
we will pay the amount of the ash, dust or particulate mat-
adjusted "loss" in excess of the ter that does not cause di-
applicable deductible up to the rect physical loss to Cov-
applicable Limit of Insurance. ered Property.
2. Time Element Waiting Period - if (e) The failure of power or oth-
your policy covers time element er utility service supplied to
losses (such as loss of income, a covered location, however
rental value or extra expense), we caused, if the failure occurs
will pay for only the portion of away from the covered lo-
the covered loss which exceeds cations.
the applicable waiting period. G. DEFINITIONS
d. Exclusions "Completed Value" means the total value of all
Covered Property (including buildings, fences,
1. In addition to Section B. Exclu- foundations, underground pipes, drains, paving
sions, we will not pay for "loss" and pilings that are a permanent part of the
caused directly or indirectly by covered job) when the job will have been
any of the following. Such "loss" finished at the end of the construction period.
is excluded regardless of any The "Completed Value" includes labor, cost of
other cause or event that contri- materials and the contractors reasonable
butes concurrently or in any se- overhead and profit
quence to the loss.
"Completed Value" does not include:
(a) Fire, explosion (other than 1. the cost of land; nor
volcanic explosion), tidal
wave, tsunami, flood, sur- 2. the cost of developing land to make it
face water, water which suitable for building (e.g., clearing, filling,
backs up through sewers or grading).
drains, water below the sur-
face of the ground (including "Loss" means accidental loss or damage.
CM 78 41 (Ed. 07/99) XS (Page 10 of 11)
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•
0182966
"Pollutant" means any solid, liquid, gaseous or a. the value of land;
thermal irritant or contaminant, including
smoke, vapor, soot, fumes, acids, alkalis, b. the cost of filling sinkhole(s);
chemicals and waste. Waste includes materials
to be recycled, reconditioned or reclaimed. c. indirect or consequential loss, the loss of
use arising from sinkhole collapse;
"Sinkhole Collapse" means the sudden sinking d. sinking of the land into man—made struc—
or collapse of the land into underground
tures.
empty space(s) created by action of water on
limestone or similar rock formations. "Substantially Completed" means construction
project structure(s) is usable for its intended
It does not include: purpose.
CM 78 41 (Ed. 07/99) XS (Page 11 of 11)
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0182966
ailGREAT AMERICAN INSURANCE COMPANIES
Subsidiaries of American Financial Corporation CM 78 79
580 WALNUT STREET, CINCINNATI, OHIO 45202 ( Ed . 1 0 92 )
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
ADDITIONAL INSURED
This applies to coverage for Inland Marine BUILDER 'S RISK PLUS
Name : KREIZENBECK CONSTRUCTORS , INC .
Address : 300 WEST MYRTLE
BOISE ID 83702
Attention :
Applies to any Covered Property in which the above Additional Insured
has an interest .
ADDITIONAL INSURED
For Covered Property in which both you and an Additional Insured
shown above have an insurable interest , we will :
1 . adjust losses with you ; and
2. pay any claim for loss or damage jointly to you and the Additional
Insured , as interest may appear .
Other Terms Remain The Same
CM 78 79 ( Ed . 10/92 ) PRO ( Page 1 of 1 )
C * I6*11 /01 /01 * IMP1851132 -00 ORIGINAL COPY
GREAT AMERICAN INSURANCE COMPANIES
Subsidiaries of American Financial Corporation I0182966
CM 78 79
580 WALNUT STREET, CINCINNATI, OHIO 45202 ( Ed . 1 0 92 )
THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY.
ADDITIONAL INSURED
This applies to coverage for Inland Marine BUILDER 'S RISK PLUS
Name : WELLS FARGO BANK NW NA
Address : P .O. BOX 8626
BOISE ID 83702
Attention :
Applies to any Covered Property in which the above Additional Insured
has an interest .
ADDITIONAL INSURED
For Covered Property in which both you and an Additional Insured
shown above have an insurable interest , we will :
1 . adjust losses with you ; and
2 . pay any claim for loss or damage jointly to you and the Additional
Insured , as interest may appear .
Other Terms Remain The Same
CM 78 79 ( Ed . 10/92 ) PRO ( Page 1 of 1 )
N N
w 5 0,
a ° 1'IZ[;I:IN11v:�RY OFFICIAL AI. S i' \ I I;NII:A' I U:� I EI) .IL"\I1 29. 2U01
U �0 .� U ,F
c° °' New Issue -BOOK-ENTRY FORM Rating: Applied For
a� c
a ,/, Y Bank Qualified
a'o In the opinion of Skinner Fawcett,Certificate Counsel,under existing law and conditioned on the Issuer complying with certain covenants relating to the tax-exempt
c +;: Y -0 status of the Certificates,interest on the Certificates is excluded from gross income of Certificate holders for federal income tax purposes.The Certificates are
v •= , :: not private activity bonds. The Certificates are designated"qualified tax-exempt obligations"as defined under Section 265 of the Internal Revenue Code of 1986,
ertificate interest may
oN tas amended,he certificatesris excluded fromnks,thrifi tgro s income foutions,and her financial r purposes of institutions.
ome taxa n by the State of Idaho. Certificate Counselsubject to other eral expreessses o opinion consequences.regarding o her
a)
° federal or state tax consequences arising with respect to the Certificates. See"TAX EXEMPTION"and Certificate Counsel's opinion,Appendix D.
Tw ° ..,
$4,000,000*
8 'TA N CITY OF MERIDIAN,IDAHO
° N Certificates of Participation,Series 2001
,---
,-.. ,
(Law Enforcement Building)
L O 4,
Issued Pursuant to a
2 ° Lease Purchase and Trust Agreement
>, 0
0 ° Wells Fargo Bank Northwest,National Association,as Trustee
or Due:August 1 as shown below
Dated: August 1,2001
c t) The Certificates are issued in fully registered form in denominations of$5,000 or multiples thereof. Principal of and premium,
o if any,on the Certificates are payable at the principal corporate office of Wells Fargo Bank Northwest,National Association,
, B- Boise,Idaho,Trustee(the"Trustee"). Interest is payable semiannually,on each August 1 and February 1,beginning February
a 1,2002 by check or draft mailed by the Trustee to the addresses of the registered owners there,in accordance with the Lease and
v 3 Trust Agreement.
3 5 0 MATURITY SCHEDULE*
E— — Interest
-' _ Interest Due
'— c Due Amount Rate Price
u C, ^ T
Aut;1 Amount Rate Price A2007 405,000
�'cs - 2002 345,000 2008 425,000
;; o 2003 355,000 2009 440,000
_1 2004 365,000 2010 460,000
— u 7:s2005 380,000 2011 435,000
F,' 2006 380,000 Plus accrued interest from August 1,2001
c
o
a, — a c
G The Certificates represent undivided proportional ownership in the principal and interest component of payments
,/, ..." pursuant to a Lease Purchase and Trust Agreement dated August 1, 2001, the"Agreement") between the City of
c °= Meridian,Idaho(the"City")and the Trustee. The Certificates are issued pursuant to the Agreement.
Uin U
s, o .., The Certificates are issuable as fully registered Certificates in denominations of$5,000 or any larger denomination
C c constituting an integral multiple of$5,000. The Certificates will be issued initially under a book-entry system,registered
3 in the name of Cede&Co.,as registered Certificate Holder and nominee for The Depository Trust Company("DTC").
Purchasers of book-entry interest in the Certificates will not receive certificates representing their interest in the
•3 3 U Certificates. See"THE CERTIFICATES—Book Entry System"herein.
= , The Certificates are subject to redemption prior to their stated maturity date,as described herein.
° The Certificates are payable from Lease Purchase Payments made by the City under the Agreement and certain
investment earnings and reserves,except to the extent accrued interest is payable from the proceeds of the Certificates,
° and Net Proceeds of a resale of the Project.
o •�
0 The City covenants that its obligation to make the Lease Purchase Payments hereunder is a special obligation
;ll o O payable solely from legally available general fund revenues of the City and does not constitute a general
Z , obligation of the City.
b5 c
•
c The Certificates are offered when,as,and if issued and accepted by the Underwriter,subject to prior sale,modification,
r m or withdrawal of the offer without notice,to the approval of legality by Skinner Fawcett, Boise, Idaho, Certificate
Y �n .� Counsel and Disclosure Counsel and to the opinion of White,Peterson,Morrow,Grigray,Rossman,Nye&Rossman,
H P.A.o as City Attorney and to certain other conditions. It is expected that the Certificates will be available for delivery
E : in Boise,Idaho on or about August 1,2001.
O 1E. o o *Preliminary. Subject to change. WELLS
FARGO
u ' =• ',
c ' -
c . u WELLS FARGO BROKERAGE SERVICES, LLC.
o x
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SUMMARY STATEMENT
(This Summary Statement is subject in all respects to more complete information contained in this
PRELIMINARY OFFICIAL STATEMENT). The offering of the Certificates to potential investors
is made only by means of this entire PRELIMINARY OFFICIAL STATEMENT,jincluding the
Appendices hereto.
The Issuer
The City of Meridian,Ada County, Idaho(the"City").
The Certificates
The $4,000,000* Certificates of Participation, Series 2001 (Law Enforcement Building) (the
"Certificates")are issued pursuant to an Lease and Trust Agreement, dated as of August 1,2001 (the
"Agreement")with Wells Fargo Bank Northwest,National Association, as trustee(the"Trustee"),
pursuant to a Resolution of the City Council adopted on , 2001,referred to herein as the
t "Resolution."
Purpose of Certificates
, The proceeds of the Certificates will be used to acquire and construct certain law enforcement
facilities and to pay certain issuance expenses.
. Security for the Certificates
The Certificates represent undivided proportional ownership interests in the principal components
of the Lease Payments due from the Lessee under the Agreement and the interest due on such
principal installments. The Certificates are secured by the long term obligation of the City to make
the Lease Payments from its general fund revenues and are additionally secured by the law
i,. enforcement building constituting the Project under the Agreement, by the accounts held by the
Trustee under the Agreement and by any sums the Trustee may realize in connection with the
exercise of default remedies. Lessee acknowledges that it holds no title to or interest in the Project,
other than as Lessee under the Agreement and its Option to Purchase which is contingent upon its
,Payment of all Lease Payments.
Continuing Disclosure
�yys,
fst-
a 'he City and the Trustee are entering into a Continuing Disclosure Agreement in order to provide
Certificate holders the continuing disclosure required by SEC rule 15c2-12(b)(5).
Preliminary. Subject to change.
yyfi
vii
�n
Reserve Account
Ci has covenanted to maintain the Reserve Account innvaamount
e equal
l leaa lesser
of maximum annual lease paymentn
The ty on the Certificates, 125%of e g
nt o
proceeds
e
the Certificates or not to exceed 10% of the an amount equal to the ReservetRequirement
Requirement"). Upon closing,the City will deposit
from proceeds of the Certificates.
Additional Certificates
the
erti
The Agreement allows the issuance of additional obligations
evenue tests, all astmore fullyCd sculssed under
cates upon
satisfaction of certain historical and prospective
Section"SECURITY FOR THE CERTIFICATES-Additional Certificates and Other Obligations."
r '
• PRELIMINARY OFFICIAL STATEMENT
$4,000,000*
CITY OF MERIDIAN,IDAHO
CERTIFICATES OF PARTICIPATION, SERIES 2001
(LAW ENFORCEMENT BUILDING)
INTRODUCTORY STATEMENT
The descriptions and summaries of various documents hereinafter set forth do not purport to be
comprehensive or definitive, and reference should be made to each document for the complete
details of all terms and conditions. All statements herein are qualified in their entirety by reference
to each document. Refer to APPENDIX A for definitions of certain words and terms used herein.
The attached Appendices are integral parts of this PRELIMINARY OFFICIAL STATEMENT and
should be read in their entirety.
Purpose of the Preliminary Official Statement
This PRELIMINARY OFFICIAL STATEMENT, including its Cover Page and Appendices, is
furnished in connection with the issuance and sale of$4,000,000* aggregate principal amount of
Certificates of Participation, Series 2001 (Law Enforcement Building) (the "Certificates"),
representing undivided proportional interests in the principal components of payments pursuant to
an Lease and Trust Agreement to be dated as of August 1,2001 (the"Agreement"),between the City
of Meridian,Idaho(the"City"),as lessee and Wells Fargo Bank Northwest,National Association,
Boise, Idaho (the "Trustee"), as lessee and trustee. The Certificates are issued pursuant to the
Agreement.
This Official Statement includes financial and other information concerning the City, and also
contains descriptions of the Certificates,the Agreement and other documents. The descriptions of
the Certificates,the Agreement, and other documents described in this Official Statement do not
purport to be definitive or comprehensive,and all references to those documents are qualified in their
entirety by reference to the approved form of those documents,which documents are available at the
principal corporate trust office of the Trustee,and during the initial offering period,may be obtained
from the Underwriter or the City.
Payment and Security for the Certificates
The Certificates represent undivided proportional ownership interests in the principal components
of the Lease Payments due from the Lessee under the Agreement and the interest due on such
principal installments. The Certificates are additionally secured by the law enforcement building
constituting the Project, are secured by the long-term obligation of the City to make the Lease
Payments from its general fund revenues,by the accounts held by the Trustee under the Agreement
*Preliminary. Subject to change.
1
and by any sums the Trustee may realize in connection with the exercise of default remedies. Lessee
acknowledges that it holds no title to or interest in the Project, other than as Lessee under the
Agreement and its Option to Purchase which is contingent upon its payment of all Lease Payments.
THE CERTIFICATES
Description of the Certificates
The Certificates are issuable in fully registered form, book entry only, in the aggregate principal
amount of$4,000,000*.
The Certificates are dated August 1, 2001 and are due on August 1 of each year commencing 2002
through 2010,inclusive in accordance with the principal amounts set forth on the Cover Page of this
Official Statement. The Certificates bear interest from their date,payable semi-annually on August
1 and February 1 of each year,commencing August 1,2002. Payment will be made to the Beneficial
Owners through the book-entry system, described herein. For a more complete description of the
terms of the Agreement except as noted authorizing the issuance of the Certificates,please refer to
APPENDIX A—SUMMARY OF THE LEASE AND TRUST AGREEMENT PROVISIONS OF THE
CERTIFICATE AGREEMENT of this PRELIMINARY OFFICIAL STATEMENT.
Purpose and Authorization
The Certificates are being issued to provide funds, which will be used to acquire and construct
certain law enforcement facilities,to provide for a reserve account and to pay costs of issuance of
the Certificates. The Certificates are authorized by the Act and are issued pursuant to the Agreement
except as noted.
Optional Redemption
Certificates maturing on or before August 1,2007 shall not be subject to call or redemption prior to
their stated maturity. The Certificates maturing on and after August 1, 2008 are subject to
redemption at the election of the City on any interest payment date on or after August 1, 2007 in
whole or in part, in inverse order of maturities and within each maturity as selected by lot by the
Trustee from and to the extent of monies that are on deposit with the Trustee at the time the notice
of redemption is mailed. Such optional redemption of the Certificates shall be at the redemption
price of par plus accrued interest.
Additional Covenants of the City
The City covenants that, for so long as the Certificates are outstanding, it will, among other things:
*Preliminary. Subject to change.
2
• (1) punctually pay or cause to be paid the Lease Payments and thereby on the Certificates
as they become due and payable.
(2) acquire and construct the Project in accordance with the Agreement.
(3) have its books audited annually by a certified public accountant and furnish reports
thereof as required under the Agreement.
(4) maintain its existence as a City and make no attempt to cause its corporate existence
to be abolished.
(5) pay or cause to be paid any taxes, assessments, or other governmental charges
lawfully imposed upon the Project and to keep the Project free and clear of all levies,
liens and encumbrances except for any created under the Agreement.
(6) maintain insurance as required in the Agreement.
(7) budget and appropriate sufficient funds to make the Lease Payments and comply with
all budget and appropriations laws.
(8) take no action,which would cause the Certificates to become arbitrage bonds within
the meaning of the Internal Revenue Code of 1986, as amended or to cause the
interest on the Certificates to be included in gross income as per federal income tax
purposes.
For more complete description of the City's covenants and representations, see APPENDIX A —
o a p p
SUMMARY OF THE LEASE AND TRUST AGREEMENT.
Trustee
Wells Fargo Bank Northwest,National Association, Boise, Idaho, is appointed Trustee, Registrar
and Paying Agent under the Agreement and Resolution.
Additional Certificates and Other Obligations
The City shall not issue obligations secured by the Project which have a lien on the Project superior
to or on a parity except as follows:
(a) The City shall not issue obligations secured by any part of the Project which have a
lien on such part of the Project superior to the Agreement.
(b) The Lessee may issue obligations secured by the Project which have a lien on the
Project which is equal to the Agreement only if:
3
(1) the obligations are issued to finance modifications to any part of the Project;
and
(2) prior to issuing the obligations the Lessee files with the Trustee a third party
appraisal reasonably satisfactory to the Trustee, appraising the value of the
Project as it is proposed to be modified; and
(3) the unpaid principal of the Agreement plus the principal amount of the new
obligation is 100%or less of the appraised value of the modified Project.
The City may issue additional obligations not secured by the Project, and may pledge any revenues
to secure such obligations.
BOOK-ENTRY PROVISIONS
The Depository Trust Company ("DTC"), New York, New York will act as securities
depository for the Certificates. The Certificates will be issued as fully registered securities registered
in the name of Cede&Co. (DTC's partnership nominee). One fully-registered Bond certificate will
be issued for each series and maturity of the Certificates,each in the aggregate principal amount of
such series and maturity, and will be deposited with DTC.
DTC is a limited-purpose trust company organized under the New York Banking Law, a
"banking organization"within the meaning of the New York Banking Law,a member of the Federal
Reserve System,a"clearing corporation"within the meaning of the New York Uniform Commercial
Code,and a"clearing agency"registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. DTC holds securities that its participants("Participants")deposit with DTC.
DTC also facilitates the settlement among Participants of securities transactions, such as transfers
and pledges, in deposited securities through electronic computerized book-entry changes in
Participants' accounts,thereby eliminating the need for physical movement of securities certificates.
"Direct Participants" include securities brokers and dealers, banks, trust companies, clearing
corporations, and certain other organizations. DTC is owned by a number of its Direct Participants
and by the New York Stock Exchange,Inc.,the American Stock Exchange, Inc.,and the National
Association of Securities Dealers, Inc. Access to the DTC system is also available to others such
as securities brokers and dealers, banks, and trust companies that clear through or maintain a
custodial relationship with a Direct Participant,either directly or indirectly("Indirect Participants").
The Rules applicable to DTC and its Participants are on file with the Securities and Exchange
Commission.
Ownership interests in the Certificates may be purchased only in the minimum authorized
denomination or any multiple thereof Purchases of Certificates under the DTC system must be
made by or through Direct Participants, which will receive a credit for such Bonds on DTC's
records. The ownership interest of each actual purchaser of each 2001 Series C Bond(for purposes
of the book-entry procedures for such Bonds,the`Beneficial Owner") is in turn to be recorded on
4
II
the Direct and Indirect Participants' records. Beneficial Owners Ownerse expected toreceive written
recei a written
confirmation from DTC of their purchase,but Beneficial
confirmations providing details of the transaction, as well as periodic Beneficialements Owner ofetheir holdings,
from the Direct or Indirect Participant through which the Ben
into the
transaction. Transfers of ownership interests in Certificates,are to be accomplished by entries made
on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not
receive certificates representing their ownership interests in Certificates,except in the event that use
of the book-entry system for such Bonds is discontinued. To facilitate subsequent transfers, all
Certificates deposited by Participants with DTC are registered in the name of DTC's partnership
nominee, Cede &Co. The deposit of Certificates with DTC and their registration in the name of
Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of Certificates;DTC's records reflect only the identity of the Direct Participants
to whose accounts such Bonds are credited,which may or may not be the Beneficial Owners. The
Participants will remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by DTC to Direct Participants,by Direct
Participants to Indirect Participants,and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Redemption notices shall be sent to Cede&Co.
If less than all of the Certificates, within a maturity are being redeemed, DTC's practice is to
determine by lot the amount of the interest of each Direct Participant in such maturity to be
redeemed.
- Neither DTC nor Cede & Co. will consent or vote with respect to Certificates. Under its
usual procedures,DTC mails an Omnibus Proxy to the issuer of bonds as soon as possible after the
record date. The Omnibus Proxy assigns Cede &Co.'s consenting or voting rights to those Direct
Participants to whose accounts such Bonds are credited on the record date (identified in a listing
attached to the Omnibus Proxy).
Principal and interest payments on the Certificates will be made to DTC by Wells Fargo
Bank Northwest,National Association,as paying agent and bond registrar for the Bonds(the"Paying
Agent" and the "Bond Registrar"). DTC's practice is to credit Direct Participants' accounts on
payable date in accordance with their respective holdings shown on DTC's records unless DTC has
reason to believe that it will not receive payment on payable date. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary practices,as is the case
with securities held for the accounts of customers in bearer form or registered in"street name",and
will be the responsibility of each Participant and not of DTC, the Trustee, the Paying Agent, the
Bond Registrar or the City,subject to any statutory or regulatory requirements as may be in effect
from time to time. Payment of principal and interest to DTC is the responsibility of the Paying
1. Agent,disbursement of such payments to Direct Participants shall be the responsibility of DTC,and
disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct and
Indirect Participants.
5
transfer and exchange of Certificates,the Beneficial Owner may be charged a sum
For everyimposed in relation thereto,
sufficient to cover any tax,fee or other governmental charge that may be bend
and anyreasonable fees and expenses of the Bond Registrar bed osts required incurredtintranspreparing
er pra ring bond nor the Bond Registrar shall
e
certificates. Neither the City applicable to such Bonds through and including the next
Certificates from the Record Date app � selection of
succeeding Payment Date for such Bonds or from the Record Date next preceding any or
such Bonds to be redeemed or thereafter until after thirsmmailing of any notice of redemption,
to transfer or exchange any such Bonds called for redemption.
DTC may discontinueproviding roviding its services as securities depository with respect to the
Certificates at any time by giving reasonable notice to the City,the Trustee,the Paying Agent or the
g
ay
scontinued or
Bond
Registrar.DTC's services with respect to the Certificates be diiother person the terminated
ed
at any time by the City,in its sole discretion and without the consent
ity
Bo
d
determines that DTC is unable to discharge its responsibilities owith be pact registered h odsorthatregistration
a
continuation of the requirement that all of such Outstanding other nominee of DTC,is not
books kept by the Bond Registrar in the name of Cede&Co.,or any
es are
in the best interests of the Beneficial Owners of such Bonde ository willing to undertds. In the event that DTC's ake the
so discontinued or terminated and no substitute securitiesP
functions of DTC under the Indenture can be found which,in te opinion of the
in the eventill itngandd
able to undertake such functions upon reasonable and customary�sfers is not in the best interests of the
determined that continuation of the system of book-entry
the Ci is obligated to deliver Bond certificates,at the expense of the Beneficial
Beneficial Owners, tY
Owners, as described in the Indenture.
The information in this section concerning DTC and DTC's book-entry system has been
obtained from sources that the City believes to be reliable,but the City takes no responsibility for
fk
the accuracy thereof
THE LEASE AND TRUST AGREEMENT
pursuant to
gt. "Agreement")
of certainprovisions of the Lease and Trust agreement(the is not a complete
A summary A. This summary
which the Certificates will be issued is contained in Appendix
and
reDuring cital of the terms of the Agreement or the documents that serve the Agreement
ial offering reference
periis
made to the Agreement and those documents in their entirety.f the Agreement and of the other
potential purchasers of the Certificates can obtain a copyof
from the Underwriter at no cost and
documents referenced below in connection with the Agreement
are encouraged to review the same before investing in the Certifints atcthesoff�ceoof the Trustee.the initial o Lease r period, potential purchasers can examine such octane
Pa ents are required under the Agreement in accordance with the schedule set forth in APPENDIX
yin
B hereto.
6
•
SOURCES AND USES OF FUNDS
The following sources and uses of funds will be applied to the Series 2001 Certificates:
Sources $ 4,000,000.00*
Principal Amount of the Certificates
Accrued Interest
TOTAL SOURCES
Uses
• Deposit to Debt Service Reserve Account $
Underwriter's Discount
Deposit to Proceeds Account
TOTAL USES
USES OF PROCEEDS
The proceeds of the Certificates, in the amount of$4,000,000*, net of costs of issuance and the
5'55 5 amount deposited to the Reserve Account,will be used to provide funds to acquire and construct
certain law enforcement facilities as follows:
•
For construction of approximately square 30 000 s uare foot, slab-on-grade, steel-framed and
-55 concrete block structure with a combination unit masonry and brick veneer finish. The
building will have 2,500 square feet of public space for community meeting rooms;as well
f as facilities for police administration,patrol, prisoner processing and staff services for the
police and detective departments to accommodate up to 75 uniformed policemen.
THE CITY
2174,7*-747,
u „ .e City of Meridian was established as a village in 1893 under the laws of the State of Idaho. The
City's population is approximately 41,735. It is served by US highway 20/26 and state highways
A 5 and 69 with easy access to the Boise Municipal Airport. The City of Meridian is located
,approximately 11 miles west of the state capitol of Boise and is by far the fastest growing city in the
estate
44e City of Meridian is in the Boise City MSA. The Boise City MSA,which includes all of Ada and
f-,Z;filpsij:.A.,'-' - Canyon Counties as well as Adams,Boise,Elmore, Gem, Owyhee,Payette,Valley and Washington
� 1 Counties,was ranked as the fourth fastest growing of 276 metropolitan areas in the nation,according
lot
to 2000 population estimates recently released by the Census Bureau. The area has grown 37.9
;:percent in the past decade.
Forbes magazine ranked the Boise City MSA(which includes the City of Meridian)as the fifth-best
�a 4'
= lace in the United States to do business and advance a career. The magazine ranked 200
{
7
ii
metropolitan regions by eight business categories,including wage and salary growth,job growth,and
high-tech clustering.
Population,
Population
Year Meridian City Ada County State of Idaho 'United States
2000 41,735 300,904 1,293,953 281,421,906
1999 34,919 283,402 1,228,684 274,329,096
1990 9,596 205,775 1,030,000 238,294,000
1980 6,658 173,125 943,930 226,504,825
1970 2,616 112,230 713,015 203,235,000
(Source: Idaho Department of Commerce)
Ada County Construction Permits
New
Dwelling Total New New Add,Alt Total
Units Permits Residential Non-Resid. and Repairs Construction
2000*
Boise 1,185 15,914 150,704,304 135,241,025 249,529,739 535,475,068
,. City of Meridian 700 . 1,250 88,645,310 72,792,738 24,968,556 186,406,604
Ada Co,(Unincorp) 833 1,488 124,139,077 18,152,353 6,035,973 148,327,403
1999
' Boise 1,391 16,520 150,742,650 69,208,687 235,569,260 455,520,597
,=
W City of Meridian 816 1,347 109,646,081 59,059,805 17,610,941 186316,827
Ada Co(Unincorp) 1,110 2,083 152,246,100 63,781,172 11,077,535 227,104,807
1998
f Boise 1,276 17,418 155,381,959 101,789,923 251,453,491 508,625,373
City of Meridian 1,020 1,572 119,505,830 27,494,777 2,714,465 152,715,072
Ada Co(Unincorp) 1,118 1,994 123,062,042 22,674,383 8,184,163 153,920,588
1997
Boise 1,438 31,234 143,378,177 71,411,122 323,686,993 538,476,292
City of Meridian 897 1,477 99,283,939 22,072,981 7,685,423 129,042,340
Ada Co(Unincorp) 637 1,311 75,362,586 17,542,370 7,186,394 100,091,350
1996
Boise 1,107 14,624 130,913,145 85,036,977 269,494,881 485,445,003
City of Meridian 1,095 1,691 115,443,902 23,597,272 8,562,682 147,603,856
Ada Co(Unincorp) 637 1,311 75,362,586 17,542,370 7,186,394 100,091,350
*Through November,2000
(Source:Idaho Construction Report)
8
irt
h
1 of Meridian Mai or Employers
Number of
Business Employees
,t t to er Education 2,000
school District No.2 Electronics Manufacturing 800
v Mail Circuit
Insurance
r580
Ong Cross of Idaho Customer Service 400
k 400
Cron customer Service Center Health Care
`Lukes Meridian Medical Center Sundries Distribution 330
g tiertsoes Lumber and Wood Products 315
Forest Products 250n o Department of Law Enforcement Police Academy
lberrtsons Food Center Grocery/Pharmacy Retail(2) 200
Food Distributor 200
Services of America Retail and Grocery 200
Meyer,Inc.
Hea E ui ment 200
�� stern- States Equipment �'3' q p
y
`rue: Idaho Department of Commerce)
"a Count Ma
Em to ers
Res
{ Number of
Business Employees
_.z o r 10,011
"� Idaho Government
tiding Boise State University Education 1,300
. Electronic Manufacturer 6,800
$n Technology 4 151
Supermarket Chain
on's 4,000
loft=Packard Corporation Electronics
� C 'sRegional Medical Center Hospital 3,207
� 3,000
° hool district Education
2,624
1,602
dlonsus Regional Medical Center Hospital' 'II ', Education
`r�l�n •School District
'4307. iseal Center Retail/Calling Center/Credit 1,390
� � Boise Government 1,247'unty Government
1,200
Idaho Department of Commerce)
r fig'
--
4.
9
Boise MSA Wage and Salary Employment by Industry(l)
Annual Average and Unemployment Rate
(Employment by Place of Work)
Annual Avera le
2000 ) 1999 1998 1997r 1996 1995
Civilian Labor Force 238,979 229,900 220,697 214,718 211,548 198,076
Unemployment
7,488 7,500 8,031 7,828 8,410 8,109
Percent of Labor Force 3.1% 3.3% 3.6% 3.6% 4.0% 4.1%
Total Employment 231,491 222,400 212,666 206,889 203,138 189,967
Nonfarm Wage& Salary
Employment
Goods-Producing Industries 52,947 51,700 49,667 48,157 46,054 44,639
453 12,983 12,898
Construction and Mining 16,029 14,5007
M67 13,
Manufacturing 36,919 37, 00 36, 00 34,704 33,071 31,731
Durable Goods 28,373 27,900 27,933 25,944 24,089 22,642
Lumber and Wood Products 3,527 3,600 3,750 3,728 3,726 3,682
s
Fabricated Metal Products 1,286 1,100 1,458 1,309 1,143 1,209
Ind&CommMach/Computer
Equip
8,013 8,000 8,816 8,431 7,848 7,426
f:.-tt Electronic&Other Electrical
11,681 10,900 10,434 9,143 8,436 7,237
¢y` p 1,551 1,510
eet rTrans i 911 Equipment
1,886 2,300 1,475 1,668
1 980 2 000 2,000 1,665 1,385 1,578
f'Y ` 7� � s bye Goods ,
:� _ n: a 8,545 9,300 8,767 8,759 8,982 9,089
'�� ot`i�l�r� ��Goods.
_}Food and Kindred Products 5,714 6,200 6,105 6,110 6,312 6,361
Printing,Publishing&Allied
,h Products 1,951 2,200 1,833 1,856 1,868 1,810
'; Other Nondurable Goods 880 900 829 793 802 918
Service Producing Industries 168,016 159,900 149,358 145,500 139,894 134,396
Transportation,
Communications and Utilities 11,566 11,800 9,858 9,480 8,879 8,634
Trade 54,241 48,400 46,608 46,514 44,720 43,011
Lit
Wholesale Trade 13,201 12,400 11,641 11,391 10,825 10,404
Retail Trade
41,040 36,000 34,967 35,123 33,895 32,607
P Finance,Ins. &Real Estate 11,270 11,300 11,875 11,045 11,517 11,711
a Service and Miscellaneous 57,433 55,000 50,042 48,804 45,906 42,929
33,507 33,400 30,975 29,657 28,782 28,111
Government Federal 4,860 5,300 5,100 4,819 4,756 4,901
State 12,659 12,300 11,517 10,942 10,651 10,641
Local
15,987 15,800 14,358 13,896 13,375 12,569
10
Higher Education
Several higher education institutions maintain facilities within easy commuting distance of the City
and serve as resources to both students and other City residents. Those institutions include: Boise
State University, Boise Bible College and George Fox University, in Boise; Northwest Nazarene
University, in Nampa; and Albertson College of Idaho in Caldwell.
Military
Idaho's largest military presence is based at Gowen Field, just south of Boise, where reserve
components are represented by units from the Army and Air National Guard, and the Army,Navy,
and Marine Corps Reserve. The National Guard employs over 1,200 local citizens on a full-time
basis at Gowen Field. These citizen-soldiers serve as maintenance and support technicians,
instructors at the Army Guard's three nationally recognized armor schools and range controllers for
the National Guard's 138,000 acres of armor maneuver area located south of the installation. Over
30,000 soldiers, sailors, airmen and marines train at Gowen Field and in Gowen's orchard training
area annually.
Transportation
The City is served by US Interstate Highway 84N, five federal primary highways and a well-
developed network of State highways. Such a location allows transportation facilities to provide
two-day service to all principal markets in the West. Nearby Boise is served by a variety of freight
companies, a bus company and Union Pacific Railroad.
Boise Air Terminal, in Boise,provides daily non-stop service to Chicago, Seattle, San Francisco,
Denver, Minneapolis, Portland, Salt Lake City, Spokane and various smaller cities. The major
airlines providing service to Boise include Delta,Horizon,Northwest, and United.
Economic Indicators for Ada County
Economic indicators for Ada County and the State are shown as follows:
Civilian Labor Force
1998 1999
Total Labor Force 161,262 166,713
Total Employment 156,161 161,288
Total Unemployed 5,101 5,424
Percent Unemployed 3.2 3.3
Farm Employment 1,352 2,347
11
Per Capita Personal Income
Year Ada County State of Idaho
1998 $30,230 $22,079
1997 28,902 21,013
1996 27,240 19,865
1995 26,943 19,199 -4"-
1994
'1994 25,424 18,264
Total Personal Income
Year Ada County State of Idaho
1998 $8,332,000,000 $27,177,000,000
1997 7,717,000,000 25,440,000,000
1996 7,088,000,000 23,592,000,000
1995 6,790,000,000 22,364,000,000
1994 6,190,000,000 20,737,000,000
Schedule of Insurance and Fidelity Bonds
Amount of
Period Coverage Type of Coverage
01/01/2001-01/01/2002 $2,000,000 General liability
01/01/2001-01/01/2002 2,000,000 Auto liability
01/01/2001-01/01/2002 1,000,000 Officials errors and omissions
01/01/2001-01/01/2002 9,000,000 Boiler,machinery claims
* Preliminary. Subject to change.
Public Employee Retirement System
The Public Employee Retirement System of Idaho(PERSI), a cost sharing multiple-employer public
retirement system,was created by the Idaho State Legislature. It is a defined benefit plan requiring
that both the member and the employer contribute. The plan provides benefits based on members'
years of service, age, and compensation. In addition,benefits are provided for disability,death,and
survivors of eligible members or beneficiaries. Designed as a mandatory system for eligible state
and school district employees,the legislation provided for other political subdivisions to participate
by contractual agreement with PERSI. Financial reports for the plan are available from PERSI upon
request.
After 5 years of credited service,members become fully vested in retirement benefits earned to date.
12
Members are eligible for retirement benefits upon attainment of the ages specified for their
employment classification. For each month of credited service, the annual service retirement
allowance is 1.917% (2.225% police/firefighter) of the average monthly salary for the highest
consecutive 42 months.
For the year ended June 30, 2000,the required contribution rate for general employees was 9.77%
and 5.86%of covered payroll for the Sample Agency and its employees,respectively,and 10.01%
and 7.21%for police/firefighter employees,for the Sample Agency and its employees,respectively.
(Source: Public Employee Retirement System of Idaho)
Employee Relations
f
The City currently employs approximately 150 full-time and 20 part-time employees. The Mayor
reports that the relationship among the City,the Council and the employees is excellent.
Form of Government
Financial and administrative responsibility for management of the City is vested in a Council Mayor
• form of government.The City Council consists of four members elected by the voters of the City to
serve four-year terms.The primary functions performed by the City include law enforcement,water,
sewer, fire protection, parks and recreation, property tax and administration of miscellaneous
services such as land planning and social services.
addition to employees, City government is assisted in formulating and implementing policy by
of ._ds and commissions made up of lay persons who serve without compensation.
47,
five Action
1 Council acts through the passage of ordinances,resolutions, agreements except as noted,
§ .Specific regulatory and resolution powers are granted by State statute. Public hearings
i as required for matters such as land use planning and budgets.
.":1:214...,i3..process
fiscal year begins October 1 and ends September 30 of the following year. The budget
yet forth all proposed expenditures for the administration, operation and maintenance
,ire budget must show the actual or estimated deficits from prior years, all debt
d interest charges during the budget year, and all expenditures for capital projects to
• r.executed during the budget year. In addition, it must set forth the anticipated
• • , ,means of financing the proposed expenditures for the ensuing year. Before the
ensuing year,the Council must enact a resolution making appropriations for that
13
ill
year. The City may amend its Enterprise Fund budgets at any time during the fiscyear,but may
City
not amend the General Fund Budget after it has been adopted by the
f
Through the preparation of the budget, and after consideration of sources of the required dollar certifi ation, costs is
construction, and expenses of City operation and maintenance,
determined.
Administration and Management
Current administrative and management personnel most directly involved in the management of the
City are as follows: Position
Name
Robert Corrie Mayor
Stacy Kilchenmann Finance Director
Will Berg City Clerk
Janice Smith Treasurer
Gary Smith City Engineer
William F.Nichols City Attorney
W. L."Bill" Gordon Police Chief
CONTINUING DISCLOSURE
The City and the Trustee, as an agent of the City and not in its capacity as Trustee,have entered into
a"Disclosure Agreement,"summarized below,pursuant to which the City will provide to the Trustee
within 180 days following the end of its Fiscal Year a copy of its annual audited financial statements
and such other financial,statistical and operating data for such Fiscal Year in form and scope similar
to the financial,statistical and operating data included in this Official Statement.The City has(1)(C) of Rule
agreed to deliver to the Trustee notice of the events described Commission underin aphe Sech urities Exchange
15c2-12 as promulgated by the Securities and ExchangeComm
Act of 1934, as amended(the "Rule"). The Trustee has agreed to deliver the information and the
notices described in the preceding two sentences upon receipt thereof from the State City
to
f Ieach
nationally recognized municipal securities information repository and
information depository,and to deliver any notice of an event described in paragraph(b)(5)(1)(C)of
Rule 15c2-12 to the Municipal Securities Rulemaking Board. The Trustee also agrees that if it has
knowledge that the City has not delivered its annual audited financial statements or has not provided
the financial, statistical and operating data as described above or if it has knowledge of the
occurrence of an event described in clauses(1),(3)or(4)of paragraph(b)(5)(1)(C) of Rule 15c2-12,
it will directly notify such nationally recognized municipal securities information repository and the
Municipal Securities Rulemaking Board of the City's failure to deliver such information of the
occurrence of such event.
A failure by the City to comply with the Disclosure Agreement will constitute an event of default
under the Disclosure Agreement and will entitle any Bondholder(including any Beneficial Owner)
14
to bring an action for specific performance and to take such other remedies as are provided in the
Disclosure Agreement. A failure by the City to comply with the Disclosure Agreement must be
reported in accordance with the Rule and must be considered by any broker, dealer or municipal
securities dealer before recommending the purchase or sale of the Certificates in the secondary
market. Consequently, such a failure may adversely affect the transferability and liquidity of the
Certificates and their market price.
SUMMARY OF CERTAIN PROVISIONS OF THE
CONTINUED DISCLOSURE AGREEMENT
"Annual Report" shall mean any Annual Report provided by the City pursuant to, and as
described in,the Continuing Disclosure Agreement.
"Beneficial Owner" shall mean any person which has the power, directly or indirectly, to
vote or consent with respect to, or dispose of ownership of, any Certificates (including persons
holding Certificates through nominees, depositories or other intermediaries).
"Dissemination Agent" shall mean the Trustee acting as dissemination agent, or any
successor Dissemination Agent designated in writing by the City.
3 "Listed Events"shall mean any of the events listed under"Reporting of Significant Events."
,4•,3! 3 "National Repository" shall mean any Nationally Recognized Municipal Securities
Information Repository for purposes of the Rule.
"Participating Underwriter" shall mean any of the original underwriters of the Certificates
,; required to comply with the Rule in connection with offering of the Certificates.
"Repository"shall mean each National Repository and the State Repository.
"Rule"shall mean Rule 15c2-12(b)(5)adopted by the Securities and Exchange Commission
;der the Securities Exchange Act of 1934, as the same may be amended from time to time.
"State Repository" shall mean any public or private repository or entity designated by the
a state repository for the purpose of the Rule and recognized as such by the Securities and
. ge Commission. Currently there is no State Repository in Idaho.
.ion of Annual Reports
I all, or shall cause the Dissemination Agent to, not later than six months after the end of
3 year(currently ending on September 30), commencing with the report for the 2000-2001
provide to each Repository an Annual Report which is consistent with the Continuing
Agreement.
15
n
If the Trustee has not been able to verify that an Annual Report has not
all sbeed a poticrovi eo tho
Repositories by the date specified in the preceding paragraph,the Trustee
Municipal Securities Rulemaking
Board and to the State Repository,if any,stating that such Annual
Report has not been timely provided and, if known, stating the date by which the City anticipates
such Annual Report will be filed.
Content of Annual Reports
Each Annual Report of the City shall contain or include by reference the following:
1. The audited financial statements of the City for the most recently ended fiscal year,
currently prepared in accordance with generally accepted accounting principles.
2. Tables setting forth the following information, as of the end of such fiscal year:
(a) For each maturity of the Certificates: the interest rate, original aggregate
principal amount and the principal amount remaining Outstanding.
(b) The amounts on deposit in the Lease Payment Account and the Reserve
Account.
Re ortint of Significant Events
Any of the following events shall be considered a Listed Event:
1. Principal and interest payment delinquencies.
2. Non-payment related defaults.
3. Modifications to rights of Certificate Owners.
4. Optional,contingent or unscheduled Certificate calls.
5. Defeasances.
6. Rating changes.
7. Adverse tax opinions or events adversely affecting the tax-exempt status of the
Certificates.
8. Unscheduled draws on debt service reserves reflecting financial difficulties.
9. Unscheduled draws on credit enhancements reflecting financial difficulties.
16
10. Substitution of credit or liquidity providers,or their failure to perform.
11. Release, substitution, or sale of property securing repayment of the Certificates.
Whenever the City obtains knowledge of the occurrence of a Listed Event,it shall determine if such
event would be material under applicable federal securities laws. If the City determines that
knowledge of the event would be material under applicable securities laws, it shall promptly notify
y the Trustee to file a notice of such occurrence with the Municipal Securities Rulemaking Board and
the State Repository, if any.
Termination of Reporting Obligation
The City's obligations under the Continuing Disclosure Agreement shall terminate upon the legal
defeasance,prior redemption or payment in full of all of the Certificates.
Dissemination Agent
The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying
out its obligations under this Disclosure Agreement, and may discharge any such Agent, with or
without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be the
Trustee.
Amendment;Waiver
Notwithstanding any other provision of this Disclosure Agreement, the City may amend this
t Disclosure Agreement,and any provision of the Continuing Disclosure Agreement may be waived,
114-7-k .. .provided that the following conditions are satisfied:
(a) If the amendment or waiver relates to the provision and content of Annual
Reports or events constituting "Listed Events," it may only be made in
connection with a change in circumstances that arises from a change in legal
r requirements,change in law,or change in the identity,nature or status of an
obligated person with respect to the Certificates, or the type of business
tt;: ` ` conducted;
(b) The undertaking,as amended or taking into account such waiver,would, in
$ the opinion of nationally recognized Certificate Counsel,have complied with
the requirements of the Rule at the time of the original issuance of the
Certificates, after taking into account any amendments or interpretations of
.44 the Rule, as well as any change in circumstances; and
(c) The amendment or waiver either (i) is approved by the Owners of the
Certificates in the same manner as provided in the Agreement for
4:. 3Y iy ��,�
Lr
17
s
amendments to the Agreement with the consent of Holders,
or(ii)dyes not,
in the opinion of nationally recognized Certificate Counsel,
r
the interests of the Holders or Beneficial Owners of the Certificates.
Additional Information
Nothing in the Continuing Disclosure Agreement shall be deemed to prevent the City from
disseminating any other information,using the means
or including any other informatissemination set forth in the nonnn
Disclosure Agreement or any other means of communication, t which is ed
any Annual Report or notice of occurrence of a Listed hooses to went, in n lude anyto thainformation�n any
bby the Continuing Disclosure Agreement. If the City c
Annual Report or notice of occurrence of a Listed he Cit t in
shall have noition to that which is obligation to updates such
required by the Continuing Disclosure Agreement, Y
information or include it in any future Annual Report or notice of occurrence of a Listed Event.
Default
In the event of a failure of the City to comply with any provision of the Continuing Disclosure
ers of
Agreement,the Trustee may(and, at the request of any Cert ficlatesng , shalor anyor tOwnOer of the
at least 25% aggregate principal amount of Outstanding
Certificates may take such actions as may be necessarytand appropriate,cply with its obligations u nderdthe
or specific performance by court order,to cause City
Continuing Disclosure Agreement. A default unement and thethe lng sole)isclosure remedy under theeContinuing
all not
be deemed an Event of Default under the Agreement, with the Continuing
Disclosure Agreement in the event of any failure of the City to comply
Disclosure Agreement shall be an action to compel performance.
Beneficiaries
The Continuing Disclosure Agreement shall inure solely to the benefit ofn
the City,the Trusttime ee,
the
Dissemination Agent, the Participating Underwriters and Owners
Certificates, and shall create no rights in any other person or entity.
FINANCIAL STATEMENTS
For the fiscal year ending September 30, 2000,Balukoff,Lindstrom &Co.,P.A., Certified Public
Accountants, Boise, Idaho served as the City's independent accountants. In the course of their
duties,they conduct audits of the City's funds and accounts that reflect the operation of the City.
18
LEGAL MATTERS
Legal matters incident to the issuance of the Certificates and with regard to the status of the interest
1
opinion(see `TAX EXEMPTION herein) are subject to the approving legal of Skinner
Fawcett, Certificate Counsel in the form attached hereto as Appendix D. Copies of that opinion,
dated and speaking only as of the date of original delivery of the Certificates,will be printed on the
Certificates and delivered to the initial purchasers of the Certificates at the time of-such original
delivery. Skinner Fawcett is also serving as disclosure counsel and will also issue an opinion in that
capacity. Certain legal matters pertaining to the Issuer, including the due authorization,execution
and delivery by the Issuer of each of the Agreement,the Continuing Disclosure Agreement, and any
other documents or instruments relating thereto and to the Certificates,will be passed upon for the
Issuer in an opinion dated as of the date of original delivery of the Bonds rendered by White,
Petersen,Morrow, Gigray,Rossman,Nye&Rossman, P.A., Meridian,Idaho, in their capacity as
Counsel to the Issuer.
TAX EXEMPTION
The Internal Revenue Code of 1986(the"Code")contains a number of requirements and restrictions
which apply to the Certificates, including investment restrictions, periodic payments of arbitrage
profits to the United States,requirements regarding the proper use of bond proceeds and the facilities
financed therewith, and certain other matters. The City has covenanted to comply with all
requirements of the Code that must be satisfied in order for the interest on the Certificates to be
excludable from gross income. Failure to comply with certain of such covenants could cause interest
on the Certificates to become includable in gross income retroactive to the date of issuance of the
Certificates.
Subject to the condition that the City comply with the above-referenced covenants,under present
law, in the opinion of Certificate Counsel, interest on the Certificates will not be includable in the
gross income of the owners thereof for federal income tax purposes, and will not be treated as an
item of tax preference in computing the alternative minimum tax for individuals and corporations.
Interest on the Certificates will be taken into account,however, in computing an adjustment used
in determining the alternative minimum tax for certain corporations.
The Code includes provisions for an alternate minimum tax("AMT")for corporations. The AMT
is levied for taxable years beginning after December 31, 1986,in addition to the corporate regular
tax in certain cases. The AMT, if any depends upon the corporations alternative minimum taxable
income("AMTI"), which is the taxable income with certain adjustments. One of the adjustment
items used in computing AMTI of a corporation(excluding S corporations, regulated investment
companies,real estate investment trusts,or REMIC's)is an amount equal to 50 percent of the excess
of such corporation's"adjusted net book income" over an amount equal to its AMTI(before such
adjustment item and the alternative tax net operating loss deduction). For taxable years beginning
after 1989, such adjustment item will be 75 percent of the excess of such corporation's "adjusted
current earnings"over an amount equal to its AMTI(before such adjustment item and the alternative
19
tax net operating loss deduction). Both"adjusted net book income"and"adjusted current earnings"
would include all tax-exempt interest,including interest on the Certificates.
Ownership of the Certificates may result in collateral federal income tax consequences to certain
taxpayers including,without limitation, corporation subject to either the environmental tax or the
branch profits tax, financial institutions, certain insurance companies, certain S corporations,
individual recipients of Social Security or Railroad Retirement benefits anditaxpayers who may be
deemed to have incurred(or continued)indebtedness to purchase or carry tax-exempt obligations.
Prospective purchasers of the Certificates should consult their tax advisors as to applicability of any
such collateral consequences.
Idaho Income Taxation
In the opinion of Certificate Counsel,so long as interest on the Certificates is not includable in the
gross income of the owners thereof for federal tax purposes, interest on the Certificates will be
exempt from taxes imposed by the Idaho Tax Act,as amended.
Non-Deductibility of Interest for Certain Financial Institutions
The City intends to designate the obligations evidenced by the Certificates as"qualified tax-exempt
obligations" pursuant to the small issuer exception provided by Section 265 b 3 of the Internal
Revenue Code of 1986, which affords banks and thrift institutions purchasing Certificates more
favorable treatment of their deduction for interest expense for taxable years of such institutions
ending after December 31, 1986.
CERTIFICATE RATING
Moody's Investors Service,Inc. has assigned an underlying rating of" "to the Certificates.
Any explanation of the significance of this rating may only be obtained from the rating service
furnishing the same. The Issuer furnished certain information and materials with respect tot e
Certificates. Generally,rating agencies base their ratings on information and materials furnished by
certain parties and on investigations, studies and assumptions by the rating agencies. The rating of
the Certificates will reflect only the view of Moody's Investors Service,Inc. There is no assurance
that the ratings given the Certificates will be maintained for any period of time or that the rating may
not be lowered or withdrawn entirely by the rating agency if, in its judgment, circumstances so
warrant. Any such downgrade change or withdrawal of such rating may have an adverse effect on
the market price of the Certificates.
UNDERWRITING
Wells Fargo Brokerage Services,LLC (the"Underwriter")has agreed to purchase the Certificates
at an aggregate purchase price equal to the par amount of the Certificates, plus accrued interest,
20
I
pursuant to a purchase contract entered into between the City and the Underwriter.An Underwriting
fee of$ will be paid to the Underwriter for its underwriting services. Under the
purchase contract, the Underwriter will be obligated to purchase all of the Certificates, if any are
purchased. The Underwriter reserves the right to join with dealers and other underwriters in offering
the Certificates to the public.The obligation of the Underwriter to accept delivery of the Certificates
is subject to various conditions of the purchase contract.
The Underwriter may offer and sell the Certificates to certain dealers(including dealers depositing
the Certificates in investment trusts)and others at prices lower than the offering prices stated on the
cover page hereof. The initial public offering prices stated on the cover page may be changed, from
time to time,by the Underwriter.
LITIGATION
There is not now pending or,to the knowledge of the City or its Counsel,threatened any litigation
restraining or enjoining the issuance or delivery of the Certificates or questioning or affecting the
validity of the Certificates or the proceedings or authority under which they are to be issued. There
is no litigation pending or,to its knowledge,threatened which in any manner questions the right of
'the City to issue or secure the Certificates in the manner provided in the Agreement except as noted.
fr
4= NIISCELLANEOUS
- City has authorized the distribution of this PRELIMINARY OFFICIAL STATEMENT. The
) -meets made in this PRELIMINARY OFFICIAL STATETMENT are believed to be complete
_ 'correct and in light of the circumstances under which they were made, not misleading in any
- al respect. The Final OFFICIAL STATEMENT will be duly executed and delivered by the
on behalf of the City of Meridian,Idaho.
•
CITY OF MERIDIAN,IDAHO
/5/
fid:
Mayor
1
21
cor
APPENDIX A
• SUMMARY OF THE LEASE AND TRUST AGREEMENT
gin£
•
3 X
+s;
•
k23
Appendix A
Summary of the Lease and Trust Agreement
The following is a summary of certain provisions of Agreement that are not discussed in the body
of the Official Statement. This summary is not to be considered a full statement of the terms of
the Agreement and accordingly is qualified by reference thereto and is subject to the full text
thereof. Capitalized terms not defined in this summary or in the Official Statement have the
respective meanings set forth in the Agreement.
Definitions.
The following terms shall have the meanings given to them in this section,unless the context
clearly requires a different interpretation.
"Accountant" means any independent certified public accountant or firm of such
countants selected by the City and acceptable to the Trustee.
•
"Agreement"means the Lease and Trust Agreement.
"Authorized Officer" means, with respect to the City, the Mayor, Treasurer, or anyone
• i.ated in writing by the City to serve as an Authorized Officer hereunder and,with respect to
:tee,any Vice President,Assistant Vice President, Trust Officer, or Assistant Trust Officer
trustee.
Beneficial Owner"means, with respect to the Certificates, a Person owning a Beneficial
p Interest therein,as evidenced to the satisfaction of the Trustee.
� f neficial Ownership Interest"means the beneficial right to receive payments and notices
i f to the Certificates which are held by the Depository under a book entry system.
ness Day"means any day other than(i)a Saturday,(ii)a Sunday, (iii)any other day
'ng institutions in New York,New York or Boise, Idaho are authorized or required
ffor the transaction of regular banking business,or(iv)a day on which the New York
a, e or Credit Facility Issuer is closed.
eans Cede &Co.,the nominee of DTC,and any successor nominee of DTC.
b nate"or"Certificates"means a certificate of participation prepared and delivered
scant to Article IV of the Agreement.
Counsel" means Skinner Fawcett or any other nationally recognized bond
sten"means the register of names and addresses of the Certificate Owners
I (a)hereof
25
"Certificate Registrar" or "Registrar"means the Trustee and any successors permitted
hereunder.
"City"means the City of Meridian,Idaho.
"Closing"means the delivery of the Certificates in exchange for the deposits specified in the
Agreement, and the date on which such exchange occurs.
"Closing Date"means the date on which Closing occurs.
"Code" means the Internal Revenue Code of 1986, as amended, and all regulations
promulgated thereunder, as amended.
"Completion Date" means the date of final acceptance of the Project by the City, as
evidenced by the certificate provided for in Section 3.02 of the Agreement.
"Construction Contract" means any construction, acquisition or installation contract
between the Trustee, or the City on behalf of the Trustee, and any contractor, and between any
contractor or subcontractor and its immediate subcontractor regarding the Project.
"Continuing Disclosure Agreement" shall mean that certain Continuing Disclosure
Agreement between the City and the Trustee dated the date of issuance and delivery of the
Certificates, as originally executed and as it may be amended from time to time in accordance with
the terms hereof.
"Corporate Principal Office"when used with respect to the Trustee,means the corporate
office of the Trustee, in Boise,Idaho at which the Trustee conducts its corporate trust business.
"Cost of Construction" shall be deemed to include payment of or reimbursement for the
following items:
(a) obligations incurred or assumed for labor and materials in connection with the repair,
replacement,improvement, construction, acquisition or installation of the Project;
(b) the cost of performance and payment bonds and of insurance of all kinds that may be
necessary or appropriate in connection with the construction or completion of the
Project;
(c) the costs of engineering services,including,without limitation, obligations incurred
or assumed for preliminary design and development work,surveys,estimates,plans
and specifications;
(d) the cost of the administration of construction and completion of the Project incurred
prior to the Completion Date, including supervision of construction as well as the
performance of all of the other duties required by or consequent upon the
construction,acquisition or installation of the Project; including,without limitation,
costs of preparing and securing all Project Documents,legal fees and expenses,credit
enhancement (bond insurance) fees and premium, independent inspection fees,
engineering and auditing fees;
26
(e) costs incurred in connection with the Certificates, including the initial compensation
and expenses of the Trustee prior to the Completion Date,legal fees and expenses,
costs incurred in obtaining ratings from rating agencies, if any,costs of publication,
printing and engraving,and recording and filing fees;
•
(f) all costs which shall be required to be paid under the terms of any Construction
Contract;
(g) all other costs which are considered to be a part of the costs of the Project in
accordance with Generally Accepted Accounting Principles and which will not
adversely affect the exemption from Federal income taxes of the designated interest
component of Lease Payments made by the City under the Agreement and the
Certificates, including, but not limited to, costs of issuance of the Certificates,
underwriting discount, and interest during construction of the Project; and
(h) payments for redemption of Certificates or payments of principal of or interest on
Certificates, at the City's option, from any moneys remaining in the Construction
Fund subsequent to the Completion Date.
(i) payments for any other essential capital items of the Lessee, provided the Lessee
certifies to the Trustee that such items are essential and the Trustee takes an
ownership and security interest in such items as provided in Section 2.02 of the
44 Agreement.
"Debt Service"means,as of any date of calculation and with respect to any period,the sum
I principal and interest components of the Lease Payments due during such period.
"Designated Representative"means the Authorized Officer at the time designated pursuant
t � r written certificate of the City to act on behalf of the City by written certificate furnished to the
tee,containing the specimen signature of that person and signed on behalf of the City by a duly
grated representative thereof
,, `Direct Participant"means a Participant as defined in the Letter of Representations.
Y " Depository"means DTC and any successor.
TC"means the Depository Trust Company,New York,New York,and its successors and
vent of Default"means an event of default under Section 2.04 of the Agreement.
"mai Year"means the period beginning on October 1 of each year and ending on the next
I September 30,or any other twelve-month period hereafter selected and designated as the
,.,year period of the City.
ernment Obligations"means direct obligations of the United States of America or
e principal of and interest on which are unconditionally guaranteed by the United States
27
�- Y
"Indirect Participant"means a Person utilizing the book entry system of the Depository
by, directly or indirectly, clearing through or maintaining a custodial relationship with a Direct
Participant.
"Interest Component"means the interest portion of each Lease Payment as described in
the Agreement.
"Investment Agreement"means any agreement between the Trustee and an investment
provider with a rating by the Rating Agency of at least Aa providing for investment of moneys
in the Proceeds Account and Reserve Account.
"Lease Payment Account"means the fund so named and described in the Agreement.
"Lease Payments"means the combined payments of principal and interest which the City
is obligated to pay pursuant to the Agreement, and which are described on page of this Official
Statement under"Lease Payments."
"Lease Term"means the period beginning on the date of this Agreement and ending on
, 20_.
"Lessee"means the City of Meridian,Idaho.
"Net Proceeds,"when used with respect to any performance or payment bond proceeds,or
proceeds from policies of insurance required hereby or any condemnation award, or any proceeds
resulting from default under a Construction Contract, or proceeds from any resale of the Project,
means the amount remaining after deducting from the gross proceeds thereof all claims paid and all
expenses (including, without limitation, reasonable attorneys fees and costs) incurred in the
collection of such proceeds or award. For purposes of the Code,"net proceeds"is to be defined as
provided therein and in the Tax Certificate delivered at Closing.
I "Original Purchaser"means Wells Fargo Brokerage Services, LLC.
"Outstanding"when used with reference to the Certificates and as of any particular date
means any Certificate theretofore delivered except: (a) any Certificate cancelled by the Trustee at
or before said date,(b)any Certificate in lieu of or in substitution for which another Certificate shall
have been delivered pursuant to the Agreement, and(c)any Certificate for which all amounts due
have either been mailed to the Owner or deposited into a special trust account for the Owner.
"Owner"or"Certificate Owner"or"Registered Owner"or any similar term,when used
with respect to a Certificate,means the registered Owner of any Outstanding Certificate as indicated
in the Certificate Register maintained by the Trustee.
"Participants"means those broker-dealers,banks and other financial institutions from time
to time for which DTC holds Certificates as securities depository.
"Paying Agent"means the Trustee and any successors permitted under the Agreement.
"Payment Dates"refers to the dates on which Lease Payments are due,as indicated in the
28
Agreement.
"Permitted Encumbrances"means the encumbrances against the real property constituting
the Project referenced in the Agreement.
"Permitted Investments"means,to the extent not prohibited by applicable law:
(a) Government Obligations;
rr
(b) Notes,bonds, debentures,or other similar obligations(excluding mortgage backed
securities) issued by the Federal Farm Credit System, Federal Home Loan Bank,
Federal Home Loan Mortgage Corporation,Federal National Mortgage Association,
Student Loan Marketing Association and other direct obligations of agencies and
' � instrumentality's of the United States of America or which are guaranteed in full by
4-4
the United States of America.
(c) Certificates of deposit issued by a nationally or state-chartered bank or savings and
loan association, to the extent that the principal amount does not exceed available
Federal Deposit Insurance Corporation insurance;
(d) Repurchase agreements approved in writing by the Certificate Insurer and which are
with banking institutions rated "A" or above by the Rating Agency or primary
broker-dealers on the Federal Reserve reporting dealer list which are under the
jurisdiction of the Security Investor Protection Corporation("SIPC")and which are
rated"A" or above by the Rating Agency;provided that: (1)the principal amount of
tl' such agreement and accrued interest thereon are fully collateralized by the pledge and
deposit of Government Obligations described in the preceding subsection(a),(2)the
term of the agreement does not exceed 30 days, (3) the collateral shall be valued
'" weekly, marked to market at current market price plus accrued interest, and the
market value of the collateral must be equal to the following principal amounts,
depending on maturity,plus accrued interest thereon.
(i) Subject to the provisions as to"Value",defined below, for purposes
the required market value of the Government Obligations,the following ratios shall
.44,;we e market value of Government Obligations as the principal amount of the repurchase
+- trending upon their maturity:
*U.S. Agency Discount Mortgage-backed
4A. U.S.Treasury and or
' 3P S Securities Coupon Securities Other Securities
101% 101% 102%
102% 102% 103%
103% 104% 105%
by Federal National Mortgage Association, Federal Farm Credit Bank and
�: zW
Board.
ero-coupon instruments are not acceptable due to excessive volatility.
.`" 29
lr
(iii) In determining market value, quotations from The Wall Street Journal,or if
not there,then in The New York Times, or if they cease publication,then a
similar fmancial journal shall be used and accrued interest shall be included.
(iv) the Trustee or a third party acting solely as agent for the Trustee has
possession of the collateral,the collateral is free and clear of third party liens
and in the case of an agreement with an SIPC broker,the collateral must not
have been acquired pursuant to a repurchase agreemenl'or reverse repurchase
agreement,
(v) failure to maintain the requisite collateral percentage will require the Trustee
to liquidate the collateral,
(vi) the Trustee shall have a first priority perfected security interest in the
collateral,and the Trustee must receive an opinion of Certificate Counsel that
the repurchase agreement meets the requirement of state law for the
investment of City's funds.
(e) Money market funds approved in writing by the Certificate Insurer and which are
registered under the Federal Investment Company Act of 1940, whose shares are
registered under the Federal Securities Act of 1933, which invest solely in
Government Obligations and which have a rating of"A" or better by the Rating
Agency.
i (f) An Investment Agreement.
f
"Value,"which for this definition of"Permitted Investments"shall be determined as of the
end of each month,means that the value of any investments shall be calculated as follows:
(a) as to investments the bid and asked prices of which are published on a regular basis
in The Wall Street Journal (or, if not there, then in The New York Times): the
average of the bid and asked prices for such investments so published on or most
recently prior to such time of determination;
(b) as to investments the bid and asked prices of which are not published on a regular
basis in The Wall Street Journal or The New York Times: the average bid price at
such time of determination for such investments by any two nationally recognized
government securities dealers (selected by the Trustee in its absolute discretion) at
the time making a market in such investments or the bid price published by a
nationally recognized pricing service;
(c) as to certificates of deposit and bankers acceptances: the face amount thereof,plus
accrued interest; and
(d) as to any investment not specified above: the value thereof established by prior
agreement between the City,the Trustee and the Certificate Insurer.
"Principal Component" means the principal portion of each Lease Payment as further
described in the Agreement.
30
t?=
"Proceeds Account"means the account so named and described in the Agreement.
"Project"means the law enforcement facilities and related items of the Lessee as described
in the Agreement.
"Project Documents"means the following (i)plans, drawings, and specifications for the
Project, when and as they are approved by the Lessee, acting on behalf of the Trustde, including
change orders, if any, as provided in the Agreement; (ii) any necessary permits for construction,
acquisition or installation of the Project; (iii)the Construction Contracts; (iv)policies of casualty,
public liability and workmen's compensation insurance or other insurance,or certificates thereof,as
required by the Agreement with respect to the construction or acquisition of the Project; (v)
performance and payment bonds with respect to the Project; (vi)any bills of sale with respect to any
equipment for the Project; (vii) the executed contract with the architect or engineer hired by the
Lessee in connection with the preparation of plans, drawings and specifications for the Project; and
(viii)any and all other documents executed by or furnished to the Lessee,on behalf of the Trustee,
in connection with the repair,replacement, improvement, construction, acquisition or installation
of the Project.
"Purchase Price"means the amount payable by Lessee if and when it chooses to exercise
its right to purchase the Project pursuant to the Agreement.
"Rating Agency" means Moody's Investors Service, Inc., and any other rating agency
providing a rating on the Certificates.
"Rebate Account"means the account so named and established by the Agreement.
"Record Date" means the Regular or Special Record Date established as the date for
purposes of determining Owners of record.
"Redemption Price" means the outstanding principal amount of and any applicable
premium on any Certificate called for redemption.
"Regular Record Date"means, the 15th day of the calendar month prior to any Payment
Date.
"Reserve Account"means the fund so named and established in the Agreement.
"Reserve Requirement"means the lesser of 125%of the average annual Lease Payments,
maximum annual Lease Payment hereunder or 10%of the total principal amount of Lease Payments
hereunder, and initially $ , which may be in the form of cash or Permitted
Investments.
"Sinking Fund Installments"means the payments, if any, required in order to cause the
mandatory redemption of Certificates as provided in the Agreement.
"Site" means the location where the Project is to be constructed as described in the
Agreement.
31
"Special Record Date" means such date as may be fixed for the payment of defaulted
interest in accordance with the Agreement.
"State"means the State of Idaho.
"Tax Certificate"means the Tax Certificates of the City concerning various matters relating
to the exclusion of intent on the Certificates from federal income tax under thejode.
"Trustee" means Wells Fargo Bank Northwest,National Association acting solely in its
fiduciary capacity through its trust department, as Trustee under the Agreement,and its successors
and assigns.
"Trust Funds or Accounts"means the trust funds and accounts created and administered
by the Trustee under the Agreement.
Lease of the Project
The Trustee has agreed to acquire and construct the Project or cause the Project to be acquired and
constructed in accordance with the Project Documents and to lease the Project to the City.The City
has agreed to lease the Project from the Trustee for the Lease Term as provided in the Agreement,
with an option to purchase the Project in accordance with the terms of the Agreement, subject to
those encumbrances permitted under the Agreement. The Trustee has authorized the City to carry
out the construction,acquisition and installation of the Project on behalf of the Trustee, including,
but not limited to executing the Project Documents.The City has accepted such authorization.The
Agreement will continue in effect until the City has paid in full all the Lease Payments.
Payment of Lease Payments
Lease Payments will be paid by the City in the amounts and at the times specified in the Agreement
(see "Lease Payments" in Appendix B of this Official Statement for the payment schedule (the
"Schedule"))which payments shall consist of a Principal Component bearing interest as determined
1 in the Agreement for the Certificates which interest shall be the Interest Component of the Lease
Payment.These payments of principal and interest are referred to herein as the"Lease Payments."
The City shall pay the Lease Payments on the fifth Business Day prior to the Payment Dates without
notice or demand,unless otherwise expressly provided in the Agreement. The amount of a Lease
Payment may be reduced by the amount then on deposit in the Lease Payment Account. The
obligation to make Lease Payments shall not be reduced because of damage, destruction, or
deterioration of the Project. The Lease Payments will be absolute and unconditional and will not be
subject to any set-off,defense,counterclaim, or recoupment for any reason whatsoever.
Prepayment. Principal of any Lease Payments may be prepaid at the option of the City, in whole or
in part,in amounts of$5,000 or integral multiples thereof,upon at least thirty(30)days'prior written
notice to the Trustee,provided: (i)that such prepayment is in such amount and at such time as will
comply with the Certificate redemption requirements of the Agreement if such prepayment is to be
deemed a defeasance of the Agreement; (ii)principal may be prepaid,without prepayment penalty,
on the date and to the extent that insurance proceeds are to be used to prepay principal pursuant to
the Agreement or to the extent condemnation proceeds are received by the City or Trustee pursuant
to the Agreement; (iii)all principal shall be prepaid to the extent of legally available funds,without
32
prepayment penalty, if the Trustee declares the unpaid principal balance immediately due and
payable pursuant to the Agreement and/or Trustee receives monies from any actions taken under the
Agreement; (iv) all principal prepayments shall be credited against the remaining Principal
Components shown in the Schedule, outstanding,in inverse order of maturity.
Title to the Project
The City shall accomplish the acquisition, construction and installation of the Project on behalf of
the Trustee,as its agent,and Trustee appoints City as its agent for such purpose.Title to the Project
shall be held by the Trustee, as trustee, for the benefit of the Owners subject to the requirements of
the Agreement, and shall remain in the Trustee until the Option to Purchase has been exercised in
accordance with of the Agreement.Upon the City's timely payment of all Lease Payments and the
exercise of the Option to Purchase has been exercised under the Agreement as well as the
compliance with all other terms and conditions of the Agreement,the Trustee shall convey all its
interest in the Project to the City by and in accordance with said Agreement.
Funds and Accounts
The Trustee shall establish a Proceeds Account for the payment of any costs of issuance and Costs
of Construction and a Reserve Account to help secure the timely payment of the Certificates.. The
Proceeds Account shall consist of the amounts deposited therein pursuant to the Agreement and any
other amounts the City may deposit therein.The amounts in the Proceeds Account,until applied for
payment of Costs of Construction and costs of issuing the Certificates as hereinafter provided,shall
be held for the security of all Certificates Outstanding under the Agreement.
The Trustee shall maintain records sufficient to permit calculation of the income on investments and
interest earned, if any, on deposit of amounts held in the Proceeds Account and such income and
interest shall become part of the Proceeds Account and may be expended as provided in the
Agreement. Copies of such records shall be made available to the City upon written request of the
City. Such income or interest earnings may be expended at any time or from time to time to pay costs
of issuance or pay principal of and interest on the Certificates in the same manner as the proceeds
of Certificates deposited in the Proceeds Account are expended.
Payments from Proceeds Account
Monies in the Proceeds Account shall be used to pay any costs of acquiring or constructing the
Project, costs incurred by the Lessee in connection with execution of the Agreement and issuance
of the Certificates, and Lease Payments (provided moneys in the Lease Payment Account and
Reserve Account are insufficient to make such payments). The Trustee shall disburse the moneys
in the Proceeds Account at the direction of the Lessee to pay Costs of Construction upon submission
of Lessee's requisition therefor in substantially the form set forth in the Agreement, signed by an
Authorized Officer of Lessee. Any moneys remaining after the earlier of payment of all such costs
or three years after the date of Closing of the Certificates,shall be transferred to the Lease Payment
Account unless the Trustee receives an opinion of Certificate Counsel to the effect that such date
may be extended without adversely affecting the exclusion of the interest component of the Lease
Payments from federal income tax under Section 103(a)of the Code.
33
Lease Payment Account
The Agreement creates with the Trustee a trust account to be designated"City of Meridian Law
Enforcement Facilities Lease Payment Account" (the "Lease Payment Account") the moneys in
which, in accordance with the Agreement,the Trustee shall make available to the Paying Agent or
Agents,to pay(i)the principal or redemption price of Certificates as they mature or become due,
upon surrender thereof and(ii)the interest on Certificates as it becomes payable.
Administration of Lease Payment Account
(a) The Lease Payment Account shall be maintained by the Trustee until the Lease
Payments are paid in full pursuant to the terms hereof. Accrued interest received
from the sale of the Certificate,Lease Payments, and any other amounts which the
Trustee receives and are available for use as Lease Payments shall be immediately
deposited by the Trustee in the Lease Payment Account.
(b) The Trustee shall withdraw from the Lease Payment Account,on each Payment date,
an amount equal to the Lease Payment due on such Payment Date,and shall pay,on
behalf of the Lessee,such withdrawn amount to the Owners as provided herein.
(c) Monies in the Lease Payment Account shall be used solely for Lease Payments except
as provided for arbitrage rebate under the Code,and to that extent such amounts may
be deposited to the Proceeds Account or Rebate Account as applicable.
(d) If on any Payment Date the amount of all Lease Payments then due and payable
exceeds the amount on hand in the Lease Payment Account,the Trustee shall apply
the moneys on hand therein first to the payment of any interest due or past due on the
Certificates,pro rata if necessary, and second to the payment of the unpaid principal
which is then due or past due,pro rata if necessary.
(e) The Lease Payment Account will be depleted at least once each year hereafter except
for a carryover amount not to exceed the greater of one year's investment earnings
on the funds in such account or 1/12th of the next annual Lease Payments. In
determining the amount of any Lease Payments due from Lessee, the Lessee shall
receive a credit for any amount then remaining in the Lease Payment Account.
Reserve Account
(a) The monies in the Reserve Account shall be held in trust for the payment,when due,
of the Lease Payments to be paid pursuant to the Agreement,and shall be used and
applied only as hereinafter provided. If on any Payment Date the moneys on hand
in the Lease Payment Account are not sufficient to pay any Lease Payment then due
and unpaid,the Trustee shall use such monies to make such payment on behalf of the
Lessee by transferring the amount necessary for this purpose to the Lease Payment
Account.
(b) Upon payment in full,or defeasance of,all Lease Payments,or if funds deposited in
the Reserve Account at any time exceeds the Reserve Requirement,the excess in the
{
34
Reserve Account shall be transferred to the lease Payment Account subject to any
payments required to the Rebate Account under the Agreement.
(c) In the event any amount of funds in the Reserve Account are paid out as provided
hereunder,the Lessee shall,within 90 days after the most recent Lease Payment date,
deposit such amount to the Reserve Account with the Trustee in order to maintain the
Reserve Account at the Reserve Requirement.
(d) All investments, if any, in the Reserve Account shall be valued at cost if maturity is
less than one(1)year and shall be valued at the lower of cost or market value marked
to market semiannually if maturity is greater than one (1) year. No investments in
the Reserve Account shall have maturities of more than two(2)years. Upon payment
in full, or defeasance of, all Lease Payments, the balance, if any, in the Reserve
Account shall be transferred to the lease Payment Account or at the option of the
Lessee,such amount shall be paid to the Lessee,subject to any payments required to
the Rebate Account under the Agreement. If the Accounts deposited to the Reserve
Account as of 30 days prior to a Payment Date exceed the Reserve Requirements,the
amount of such excess shall be transferred to the lease Payment Account. Funds, if
any, in the Reserve Account may be used to make the final Lease Payment.
Certain Covenants under the Agreement
The discussion below does not include all of the representations and covenants of the City under the
Agreement,nor are all of those included presented in their entirety. So long as the Agreement is in
effect,the City has pledged as follows:
Maintenance and Operation of Project. The City, at its expense, will maintain the facilities
constituting the Project or cause such facilities to be maintained during their useful life in good
condition,repair, appearance and working order.
Taxes and Assessments. The City agrees to pay,when due, any and all taxes, assessments and other
charges which may now or hereafter be imposed on the ownership, leasing,rental, sale,purchase,
possession or use of the Project, and to indemnify and hold the Trustee harmless from and against,
such taxes, assessments and charges, excluding however, all taxes on or measured by Trustee's
income. The City may contest any such taxes prior to payment provided such contest does not
involve any risk of sale,forfeiture or loss of the Project or any interest therein or create a lien on the
Project.
Insurance.The City will pay for or provide standard fire and casualty insurance on the Project in an
amount at least equal to the unpaid principal of the Agreement which may be with such self insured
retention amounts as are customary and reasonable for other municipalities of the size and nature of
the City. Deductible amounts of up to$10,000 are deemed reasonable. The Trustee must be named
as loss payee therein. Any proceeds of such insurance will be paid to the Trustee. If the City has
breached any of its promises herein contained(regardless of whether such breach constitutes an event
of default)and the breach has not been cured by the time insurance proceeds are paid to the Trustee,
the insurance proceeds will be used to prepay the principal portion of Lease Payments as soon as
possible after the Trustee receives the insurance proceeds. If the City has not breached its promises
under the Agreement, or any breach has been cured,then the City may apply the insurance proceeds
to the repair and/or replacement of the Project,or to prepayment of Lease Payments, in its discretion.
35
(a) Upon the execution and delivery of the Agreement,the City must,in accordance with
any applicable standards of the State insure against public liability including errors
and omissions coverage which may be by means of self insurance and civil rights
coverage, by means of a self insurance fund, with respect to the activities to be
undertaken by and on behalf of the City in connection with the use of the Project.
The public liability insurance required by the Agreement may be by blanket insurance
policy or policies. The City may alternatively, elect to carry, at its expense,public
liability insurance(including insurance against civil rights claims)with respect to the
Project in amounts not less than the limits of liability of the Idaho Tort Claims Act.
In such event, such policies must show the City and all officers and employees
thereof as a named insured.
(b) If an Event of Default occurs after the Trustee receives insurance proceeds and if not
cured, any proceeds of insurance held by the Trustee must be applied to the payment
of amounts due under the Agreement.
Annual Audit. The City agrees that it will have books and records audited annually by a certified
public accountant(the"Accountant")within one hundred eighty(180) days after the close of each
fiscal year of the City, certified by such Accountant and must furnish a copy of the Accountant's
report thereof to the Trustee and Original Purchaser as soon as possible after receiving the same.
Hazardous Substance Provisions. It is expected that City, its agents, employees, contractors,
subcontractors, affiliates, agents, subtenants,licensees and invitees(collectively,"City's Persons")
may store and/or use in or near the Project the Hazardous Substances(as defined below)as set forth
in the Agreement. Except for the foregoing and except as provided in the following sentence, City
and City's Persons will not generate,manufacture,store, dispose of or otherwise use or hold on or
under or about the Project or transport to,from or across the Project any other Hazardous Substances
(as defined below). The City will not cause or permit any additional Hazardous substance to be
brought upon,kept,used or generated by the City, its agents, employees,contractors or invitees,in
the operation of the Project,unless the use or generation of the Hazardous Substance is necessary
for the prudent operation of the Project and no functional and reasonably economic non-hazardous
substance or process which does not generate Hazardous Substances can be used in place of the
Hazardous Substance or the process which generates the Hazardous Substances. City's Persons will
use and store all Hazardous Substances in a safe and careful manner and in full compliance with all
applicable federal, state and local laws and regulations. City and City's Persons must, at no time,
permit, suffer or acquiesce in any other person undertaking the foregoing. For purposes of the
Agreement and to the extent permitted by law, any acts or omissions of City or City's Persons
(whether or not they are negligent, intentional, willful or unlawful) will be strictly attributable to
City. If City receives notice from any local, state or federal governmental agency of any proposed
action against City under or violation of any Hazardous Substance Law pertaining to the Project,City
must promptly provide Trustee with a copy of such notice. As used herein,"Hazardous Substances"
means any oil,flammable explosives, asbestos,radioactive materials or wastes,medical waste, or
other hazardous,toxic,contaminated or polluting materials,substances or wastes including,without
limitation, any"hazardous"or"toxic"substances,wastes,or materials under any federal, state, or
local law,ordinance or regulation relating to industrial hygiene,environmental protection, or the use,
analysis,generation,manufacture,storage or transportation of such substances currently in effect or
as may be promulgated or amended in the future.
36
City will, at its own expense, comply and cause City's Persons to comply with all Hazardous
Substance Laws, including, without limitation, those controlling the discharge of(appropriately
treated) materials or wastes into or through any sanitary sewer serving the Project. Except as
discharged into the sanitary sewer in strict accordance and conformity with all applicable Hazardous
Substance Laws, City, at its sole cost and expense, will cause any and all Hazardous Substances
removed from the Project to be removed and transported solely by duly licensed haulers to duly
licensed facilities for final disposal of such materials and wastes. Except as described in the
Agreement, City will, at its sole cost and expense, cause all contamination to be cleaned up, or all
Hazardous Substances to be removed from the Project and transported for use,storage or disposal,
in accordance and compliance with all Hazardous Substance Laws.
• Issuance of Additional Obligations Secured by the Project or Revenues
r • x
,n� • e (a) The Lessee shall not issue obligations secured by any part of the Project which have
.¢ a lien on such part of the Project superior to the Agreement.
(b) The Lessee may issue obligations secured by the Project which have a lien on the
Project which is equal to the Agreement only if:
(1) the obligations are issued to finance modifications to any part of the Project;
and
(2) prior to issuing the obligations the Lessee files with the Trustee a third
party appraisal reasonably satisfactory to the Trustee, appraising the value
of the Project as it is proposed to be modified; and
(3) the unpaid principal of this Agreement plus the principal amount of the new
.41 obligation is 100%or less of the appraised value of the modified Project.
Default and Trustee's Remedies
f ,Default. The occurrence of one or more of the following events constitute an Event of
. ether occurring voluntarily or involuntarily,by operation of law or pursuant to any order
or governmental agency (i) the City's failure to make any Lease Payment by the
Payment Date; (ii) the City's failure to comply in any material respect with any other
4 sndition,or agreement of the City under the Agreement for a period of thirty(30)days
ereof from the Trustee;(iii)any representation or warranty made by the City under the
s: untrue in any material respect as of the date made; or (iv) if the City becomes
i=e City admits in writing an inability to pay its debts as they mature or applies for,
acquiesces in the appointment of a trustee or receiver for the Lessee or a substantial
and is not discharged within sixty(60)days; or any bankruptcy,reorganization,
or moratorium,or any proceeding under any bankruptcy or insolvency law,or any
uidation proceeding, is instituted by or against the System and,if instituted against
dismissed within ninety(90) days.
the occurrence of any Event of Default,the Trustee may, and shall upon written
37
request of the Owners of Certificates representing less thirty-five
1
ercent
(35%)of the principal amount unpaid Lease Payments,exercise any or all of the
following remedies:
(i) Declare the unpaid principal balance, together with accrued interest,
immediately due and payable;
(ii) Terminate the Agreement and give notice to the Lessee to surrender
possession and use of the Project and the Lessee shall surrender such
possession and use of the Project immediately, and thereupon thethe ustee
e
may proceed first,to lease the Project on terms sufficient to pay
Payments when due hereunder,or if such a lease is not feasible,then to sell
all property constituting the Project unless the Trustee, or the Owners
representing a majority of principal amount of the Certificates then
Outstanding, shall deem a nelay in such eventt the Trusheesale of te Project to may easebhe ProJee in the c or
t
interest of the Owners and
portions thereof for the benefit of the Owners;
(iii) Exercise its rights as a secured party under the Uniform Commercial Code;
and/or
(iv) Pursue and exercise any other remedy available at law or in equity to enforce
its rights in and to the Project under this Agreement.
The foregoing remedies are cumulative and the exercise of any of them shall not preclude
the exercise of one or more of the others.
(b)
The Trustee may rescind any declaration made under subsection (a) above and
abandon any exercise of remedies if there has been no failure to pay Owners Lease
Payments, and the Event of Default laiver of any s cured byo her Event of Defaulte Lessee. Such ission and
abandonment shall not constitute
(c) Upon any sale or lease of the Project pursuant to(a)(ii)above,any Certificate Owner
may bid for and purchase or lease the Project and,upon compliance with the terms
of the sale,may hold,retain and possess and dispose of such property in his,her or
their own absolute right without further accountability;
(d) If the Project is sold pursuant to(a)(ii)above,any purchaser at any such sale may, if
(a)(ii)
permitted by law,tender Certificates then Outstandinan ameeditt equal to the urchase
price of the Project. The amount of the credit shall
of the principal amount of the Certificates nd the denominator of which is the total
dered times a fraction,the numerator
of which is the sales price of the ProjectCertificates tendered pursuant
principal amount of all Certificates then Outstanding•
to this shall be deemed paid in�oamountt of credit p�demaining unpaid on the
the Trustee shall issue
new Certificates in a principal
Certificates so tendered after allowance of the credit. ve,the
(e) From the proceeds of therelatingle or ease of the to s d salerany costs of repoject under li)air or replacemTrustee of
shall deduct any expensesy'' 38
any property constituting the Project, the expenses or actions taken to enforce this
Agreement and any other expenses related thereto and shall then deposit to the Lease
Payment Account the amount sufficient to redeem Certificates in accordance with
this Agreement. If such proceeds are insufficient to redeem all Outstanding
Certificates in full, each Owner shall be entitled to a pro rata share of such proceeds,
based on the Outstanding principal amount held by each Owner. If such proceeds
exceed the amount required to pay the expenses referenced above andjo redeem all
Outstanding Certificates in full, then the balance remaining after paying any other
amounts due under this Agreement shall be paid to the Lessee.
•
(f) Accounting and Examination of Records After Default.
(i) The Lessee covenants that if an Event of Default shall have happened and
shall not have been remedied,the books of record and account of the Lessee
and all other records relating to the Project shall at all reasonable times be
subject to the inspection and use of the Trustee and of its agents and
attorneys.
(ii) The Lessee covenants that if an Event of Default shall happen and shall not
have been remedied,the Lessee,upon demand of the Trustee, will account,
as if it were the trustee of an express trust, for all moneys, securities and
funds pledged or held under this Agreement for such period as shall be stated
in such demand.
g) Application of Funds and Moneys After Default.
(i) The Lessee covenants that if an Event of Default shall happen and shall not
have been remedied,the Lessee,upon demand of the Trustee, shall pay over
or cause to be paid over to the Trustee forthwith all appropriated moneys,
securities and funds then held by the Lessee and pledged under this
Agreement as promptly as practicable after receipt thereof.
(ii) During the continuance of an Event of Default, the Trustee shall apply all
moneys, securities, funds received by the Trustee pursuant to any right given
or action taken under the provisions of the Agreement as follows and in the
following order:
-44
(1) Expenses of Trustee.
ent of the reasonable and proper charges, expenses and liabilities of any Trustee;
= (2) Operating Costs.
ent of the amounts required for reasonable and necessary operating costs,
reasonable and necessary costs for the management,maintenance and
upkeep of the Project and costs for the reasonable renewals, repairs
and replacements of the Project, all as necessary, in the judgment of
the Trustee,to prevent deterioration of the Project. For this purpose
the books of record and accounts of the Lessee relating to the Project
39
shall at all times be subject to the inspection of the Trustee and its
representatives and agents during the continuance of such Event of
Default;
(3) Principal or redemption price and interest.
Defeasance of the Obligations
(a) When the principal or redemption price(as the case may be)of,and interest on,all
Lease Payments evidenced by the Certificates issued hereunder have been paid, or
provision has been made for payment of the same,together with the compensation
of the Trustee and all other sums payable hereunder by the Lessee,then the right,title
and interest of the Trustee shall thereupon cease and the Trustee,on demand of the
Lessee, shall release the Agreement and shall execute such documents to evidence
such release as may be reasonably required by the Lessee and shall turn over to the
Lessee or to such person,body or authority as may be entitled to receive the same all
balances then held by it hereunder. If payment or provision therefor is made with
respect to less than all of the Lease Payments evidenced by the Certificates, the
particular Certificates(or portion thereof)for which provision for payment shall have
been considered made shall be selected by lot by the Trustee, and thereupon the
Trustee shall take similar action for the release of the Agreement with respect to such
Certificates.
(b) Provision for the payment of Certificates shall be deemed to have been made when
the Trustee holds in a separate account,in trust and irrevocably set aside exclusively
for such payment in such account,Governmental Obligations maturing as to principal
and interest in such amounts and at such times as will provide sufficient moneys
(without consideration of any reinvestment thereof)to make such payment and which
are not subject to prepayment,redemption or call prior to their stated maturity.
No Certificates in respect of which a deposit referred to above has been made shall
be deemed paid within the meaning of this Section unless the Trustee is satisfied that
the amounts deposited are sufficient to make all payments that might become due on
the Certificates. Notwithstanding the foregoing,no delivery to the Trustee under this
subsection (b)shall be deemed a payment of any Certificates which are to be
redeemed prior to their stated maturity until such Certificates shall have been
irrevocably called or designated for redemption on a date thereafter on which such
Certificates may be redeemed in accordance with the provisions of the Agreement
and proper notice of such redemption shall have been given in accordance with this
Agreement or the Lessee shall have given the Trustee, in form satisfactory to the
Trustee, irrevocable instructions to give, in the manner and at the times prescribed
by this Agreement, notice of redemption. Neither the obligations nor moneys
deposited with the Trustee pursuant to thisLion and heldlm trust forbe awn or used for
the payment of
any purpose other than,and shall be segregated
the principal of,redemption price of and interest on the Certificates with respect to
which such deposit has been made.
(c) Anything in the Agreement to the contrary notwithstanding, if moneys or
Governmental Obligations have been deposited or set aside with the Trustee pursuant
40
to this Section for the payment of the principal or redemption price of the Certificates
and the interest thereon and the principal or redemption price of such Certificates and
the interest thereon shall not have in fact been actually paid in full, no amendment
to the provisions of this Section shall be made without the consent of the owner of
each of the Certificates affected thereby.
Notwithstanding the foregoing,those provisions relating to the purchasg of
Certificates,the maturity of Certificates, interest payments and dates thereof, and
the Trustee's remedies with respect thereto, and provisions relating to exchange,
transfer and registration of Certificates,replacement of mutilated, destroyed,lost
or stolen Certificates,the safekeeping and cancellation of Certificates,non-
presentment of Certificates,the holding of moneys in trust, and repayments to the
Lessee from the Lease Payment Fund and the duties of the Trustee in connection
with all of the foregoing and the fees, expenses and indemnities of the Trustee,
shall remain in effect and shall be binding upon the Trustee,the Lessee and the
Certificate Owners notwithstanding the release and discharge of the lien of the
Agreement.
Amendment
The Agreement may be amended without the consent of the registered owners of the Certificates,
in order to (a) add additional covenants of the Lessee or to surrender any right or power herein
..conferred upon the Lessee and (b) to cure any ambiguity or to cure, correct or supplement any
defective provision of this Agreement in such manner as shall not be inconsistent with the
-,agreement and shall not impair the security of the Agreement or adversely affect the Certificate
er m a material way. Any other amendment to either document requires the consent of owners
f Certificates constituting at least a majority of the total principal amount of Certificates then
utstanding.
rjr
744
AK
41
{
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I
APPENDIX B
LEASE PURCHASE PAYMENTS
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� 43
Estimated
Lease Purchase Payments*
Date Principal* Coupon* Interest* Total*
02/2002 $75,928.75 $75,928.75
08/2002 $345,000.00 2.70% 75,928.75 496,857.50
• 02/2003 71,271.25 71,271.25
08/2003 355,000.00 3.10% 71,271.25 497,542.50
02/2004 65,768.75 65,768.75
08/2004 365,000.00 3.40% 65,768.75 430,768.75
02/2005 59,563.75 59,563.75
`' 08/2005 380,000.00 3.60% 59,563.75 499,127.50
02/2006 52,723.75 52,723.75
08/2006 390,000.00 3.75% 52,723.75 442,723.75
02/2007 45,411.25 45,411.25
xX08/2007 405,000.00 3.95% 45,411.25 450,411.25
2/ 008 37,412.50 37,412.50
„�' x.$/2008 425,000.00 4.10% 37,412.50 462,412.50
+d'
11 12009 28,700.00 28,700.00
- 2009 440,000.00 4.20% 28,700.00 468,700.00
010 19,460.00 19,460.00
10 460,000.00 4.30% 19,460.00 498,920.00
10 9,570.00 9,570.00
0 435,000.00 4.40% 9,570.00 444,570.00
,subject to change.
45
APPENDIX C
AUDITED FINANCIAL STATEMENTS
YEAR ENDING SEPTEMBER 30,2000
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