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ARTICLE III RENT AND ADDITIONAL PAYMENTS · Section 3.1. Basic Rent_. (a) The Lessee covenants and agrees that on behalf of the City, and as its payment of part of the Basic Rent due the City hereunder, the Lessee will pay directly to the Senior Trustee and the Subordinated Trustee, respectively, for the account of the City, the moneys which as to amount and time of payment will satisfy the requirements of Section 16 of the Senior Ordinance and Section 8 of the Subordinated Ordinance. Co) The Lessee further covenants and agrees that it will deposit with the appropriate Trustee all other moneys required to be deposited by the Indentures and will timely perform each and every obligation, duty and right of the City under the Indentures. (c) Except for any interest which may arise hereafter with respect to moneys pursuant to Sections 4.02 of the Indentures, the Lessee and the City each acknowledges that, except as otherwise provided in the Indentures, neither the Lessee nor the City has any interest in any of the funds created by the Indentures or any moneys deposited therein and that such funds and moneys shall be in the custody of and held by the Trustees for the benefit of the Bondholders. Section 3.2. Additional Payments. Subject to the pledge made in and the security interest granted by the Guaranty and after making the payments required by Section 3.1 hereof, the Lessee covenants and agrees to make Additional Payments as follows: (a) To the City on March 31, June 30 and September 30 in each year, commencing March 31, 1997, the amount shown opposite the date and year of payment in Schedule 1 hereto, provided that if the Closing Date (as defined in the Definitive Agreement) occurs after March 31, 1997 then the amounts shown on Schedule 1 to have been paid prior to the Closing Date shall be paid on the Closing Date, provided further, that if the City should impose or levy on the Lessee an ad valorem, income, franchise or business excise or tax, then the Additional Payment to be made in a year shall be reduced by an amount equal to the amount of such excise or tax paid by the Lessee and received in that year by the City, whether paid to it directly or paid to the State or a taxing unit thereof. Such reduction shall, to the extent possible, be applied equally against each of the payments required to be made in that year. (b) To the City, the Member or the Trustees, as the case may be, regardless of whether an Event of Default has occurred hereunder, payment for or reimbursement or prepayment of any and all reasonable costs, expenses and liabilities: (i) incurred or paid by the City, the Member or the Trustees, as the case may be, in satisfaction of any obligations of the Lessee hereunder or of the City, the Member or the Lessee under the Indentures not performed by the Lessee in accordance with the provisions hereof or thereof, (ii) incurred as a result of a request by the Lessee or a requirement of this Lease or the Indentures, or - 16-