Ordinance 99-86 - Laserfiche WebLink

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ARTICLE III COVENANTS, FUNDS AND APPLICATION THEREOF SECTION 3.1 BOND AND BOND ANTICIPATION NOTE NOT TO BE INDEBTEDNESS OF THE CITY. Neither the Bond nor the Bond Anticipation Note shall be or constitute an indebtedness of the City within the meaning of any constitutional, statutory or other limitation of indebtedness, but shall be secured solely by and payable from the Pledged Revenues. Neither the Bank nor the Bondholder shall ever have the right to compel the exercise of the ad valorem taxing power of the City, or taxation in any form of any real property therein, to pay said Bond or Bond Anticipation note or the interest thereon. The pledge of the Pledged Revenues will not constitute a lien upon any property of the City. SECTION 3.2 BOND AND BOND ANTICIPATION NOTE SECURED BY PLEDGE OF PLEDGED REVENUES. From and after the issuance of the Bond and the Bond Anticipation Note, and continuing until the payment of the Bond and the Bond Anticipation Note as to principal and interest, the Pledged Revenues shall continue to be pledged for the prompt payment of principal of and interest on said Bond and Bond Anticipation Note. The pledge of the Pledged Revenues for payment of principal and interest on the Bond and the Bond Anticipation Note is subject only to the prior and senior pledge of the Electric Utilities Tax for the payment of the City's outstanding Revenue Bonds, Series 1998, Series 1999 and Series 1999B. Additionally the Bond Anticipation Note shall be payable from and secured by the proceeds of the Bond. SECTION 3.3 COVENANTS OF THE CITY. As long as any of the principal of or interest on the Bond or the Bond Anticipation Note shall be outstanding and unpaid, or until there shall have been set apart in the Debt Service Fund in accordance with Section 3.6 hereof a sum sufficient to pay, when due, the entire principal of the Bond and the Bond Anticipation Note remaining unpaid, together with interest accrued and to accrue thereon, the City covenants with the Bondholder and the Bank as follows: (a) Tax Covenants Relating to the Internal Revenue Code of 1986, as amended. (1) In order to maintain the exclusion from gross income for purposes of federal income taxation of interest on the Bond and the Bond Anticipation Note, the City covenants to comply with each requirement of the Code. In furtherance of the covenant contained in the preceding sentence, the City agrees to continually comply with the provisions of the Tax Certificate, as such certificate may be amended from time to time, as a source of guidance for achieving compliance with the Code. (2) The City covenants and agrees with the Bondholder and the Bank that the City shall not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bond or the Bond Anticipation Note, would cause the Bond or the Bond Anticipation Note to be a "private activity bond" or "arbitrage bond" within the meaning of Sections 141(a) and 148(a), respectively, of the Code. 20