RES 02047 - Laserfiche WebLink

The City will not enter into any agreement or lease which would impair the ability of the City to meet the covenant set forth in Section 5.16 hereof or which would otherwise impair the rights of the Owners or the operation of the Enterprise, Section 5.08. Against Comoetitive Facilities. Except for any utility system existing as of the date hereof, the City will not. to the extent permitted by law. acquire. maintain or operate and will not, to the extent permitted by law and within the scope of its powers. permit any other public or private agency. authority, city or political subdivision or any person whomsoever to acquire, maintain or operate within the City any utility system competitive with the Enterprise: provided, however, that the City may assign all or a portion of the Enterprise to another entity upon delivery to the Trustee of an opinion of nationally recognized bond counsel that such assignment will not adversely affect the tax-exempt status of the Bonds. and provided such entity assumes the obligations of the City hereunder. Section 5.09. Tax Covenants. The City hereby covenants that it shall not make or permit any use of the proceeds of the Bonds that may cause the Bonds or the Prior Obligations to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986. as amended. The City covenants that so long as any Bonds remain Outstanding. the amount of capacity of the Enterprise to be used. allocated or assigned to any person. other than a governmental unit. will not exceed 10% of the total capacity of the Enterprise during such period. For these purposes, the total capacity of the Enterprise shall be determined by multiplying the annual capacity of such Enterprise by the number of years in the term of its anticipated useful life. The annual capacity of such Enterprise shall be determined by reference to its maximum yearly capacity. The term "governmental unit" means the State of California or any political subdivision thereof. In furtherance of these covenants. the City agrees to comply with the covenants contained in. and instructions given pursuant to. the tax and inheritance certificate provided to the City by Nossaman. Guthner. Knox & Elliott. LLP. Section 5,10. Maintenance and Ooeration of the Entemrise: Bud1!ets. The City will maintain and preserve the Enterprise in good repair and working order at all times and will operate the Enterprise in an efficient and economical manner and will pay all Maintenance and Operation Costs of the Enterprise as they become due and payable, Upon written request. the Citv will file with the Trustee a certificate stating that Maintenance and Operation Costs of the Enterprise and Debt Service Payments are included in the City budget. Section 5. 11. Pavment of Claims. The City will pay and discharge any and all lawful claims for labor. materials or supplies which. if unpaid. might becorne a lien on the Net Revenues or any part thereof or on any funds in the control of the City or the Trustee prior or superior to the lien of the Bonds or which might impair the security of the Bonds; provided the City shall not be obligated to make such payment so long as the City contracts such payment in good faith. -28- Pleasanton Cross TO\vn Indenture (2).DOC