Reso 2010-1538-1 - Laserfiche WebLink

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. indirectly) from proceeds of a tax-exempt obligation. . (iv) An obligation that is part of an issue is a refunding obligation to the extent that: (a) proceeds of the issue are used to pay principal or interest on an obligation that is part of another issue; and (b) the amount of the refunding obligation does not exceed the amount of the refunded obligation (determined at the time of issuance of the refunding obligation). For this purpose, the amount of an obligation is the stated principal amount plus accrued unpaid interest (or, if the original issue premium or discount exceeds 2 percent, the present value of the obligation). . . (v) A refunding obligation is a current refunding obligation if no portion of the proceeds of the issue of which the refunding obligation is a part is used (directly or indirectly) to pay principal, interest, or call premium on any obligation that is part of another issue more than 90 days after the date of issue of the refunding obligation. . (b) The Bonds have been designated by the City as qualified tax-exempt obligations (as defined in section 265(b)(3)(B) of the Code) in Section 3.10 of the Loan Agreement. 7. Miscellaneous . (a) No more than 50 percent of the proceeds of the Bonds will be invested in nonpurpose investments having a substantially guaranteed yield for four years or more (within the meaning of section 149(g)(3)(A)(ii) of the Code). More than 85 percent of the spendable proceeds of the Bonds (within the meaning of section 149(g)(3)(A)(ii) of the Code) will be expended for governmental purposes within three years of the date hereof. I I. I I I I. (b) Amounts that are subject to yield restriction under section 4 hereof (determined without regard to the $100,000 exception) will not be invested (directly or indirectly) in federally insured deposits or accounts (within the meaning of section 149(b)(4)(B) of the Code) if such investment would exceed the limit of 5 percent of the proceeds of the Bonds contained in section 149(b)(2)(B) of the Code. (c) No portion of the proceeds of the Bonds will be used as a substitute for other funds that were otherwise to be used as a source of financing for any portion of the Project. . (d) There are no other obligations of the City: (i) that are or will be sold within 15 days of the date hereof; and (ii) that are to be paid out of substantially the same source of funds (or that will have substantially the same claim to be paid out of substantially the same source of funds) as will be used to pay the Bonds. . (e) The City has covenanted that the City will not make any investment or use of the proceeds of the Bonds that would cause the Bonds to be "arbitrage bonds" within the meaning of section 148 of the Code. No portion of the proceeds of the Bonds will be intentionally used in the manner described in section 148( a) (1 ) or (a)(2) of the Code. 5 {M1886561_2} .