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ORDINANCE NO. 2008-30 PAGE 5
<br />Section 10. The Village covenants that it will use, and will restrict the use and
<br />investment of, the proceeds of the Notes in such manner and to such extent as may be necessary so
<br />that (a) the Notes will not (i) constitute private activity bonds, arbitrage bonds or hedge bonds under
<br />Sections 141, 148 or 149 of the Internal Revenue Code of 1986, as amended (the Code), or (ii) be
<br />treated other than as bonds to which Section 103(a) of the Code applies, and (b) the interest on the
<br />Notes will not be treated as a preference item under Section 57 of the Code.
<br />The Village further covenants that (a) it will take or cause to be taken such actions that
<br />may be required of it for the interest on the Notes to be and remain excluded from gross income for
<br />federal income tax purposes, and (b) it will not take or authorize to be taken any actions that would
<br />adversely affect that exclusion, and (c) it, or persons acting for it, will, among other acts of
<br />compliance, (i) apply the proceeds of the Notes to the governmental purpose of the borrowing, (ii)
<br />restrict the yield on investment property, (iii) make timely and adequate payments to the federal
<br />government, (iv) maintain books and records and make calculations and reports, and (v) refrain
<br />from certain uses of those proceeds and, as applicable, of property financed with such proceeds, all
<br />in such manner and to the extent necessary to assure such exclusion of that interest under the Code.
<br />The Village hereby represents that the Outstanding Note (the Refunded Obligation) was
<br />designated or treated as a "qualified tax-exempt obligation" pursuant to Section 265(b)(3) of the
<br />Code. The Village hereby covenants that it will redeem the Refunded Obligation from proceeds of,
<br />and within 90 days after issuance of, the Notes, and represents that all other conditions are met for
<br />treating the amount of the Notes equal to the face amount thereof as "qualified tax-exempt
<br />obligations" and as not to be taken into account under subparagraph (D) of Section 265(b)(3) of the
<br />Code, without necessity for further designation, by reason of subparagraph (D)(ii) of Section
<br />265(b)(3) of the Code. Further, the Village represents and covenants that, during any time or in any
<br />manner as might affect the status of the Notes as "qualified tax-exempt obligations", it has not
<br />formed or participated in the formation of, or benefited from or availed itself of, any entity in order
<br />to avoid the purposes of subparagraph (C) or (D) of Section 265(b)(3) of the Code, and will not
<br />form, participate in the formation of, or benefit from or avail itself of, any such entity. The Village
<br />further represents that the Notes are not being issued as part of a direct or indirect composite issue
<br />that combines issues or lots oftax-exempt obligations of different issuers.
<br />The amount of the Notes (such amount being based on the issue price of the Notes as
<br />determined under the Code) in excess of the face amount thereof are hereby designated as "qualified
<br />tax-exempt obligations" for purposes of Section 265(b)(3) of the Code. In that connection, the
<br />Village hereby represents and covenants that it, together with all its subordinate entities or entities
<br />that issue obligations on its behalf, or on behalf of which it issues obligations, in or during the
<br />calendar year in which the Notes are issued, (i) have not issued and will not issue tax-exempt
<br />obligations designated as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of
<br />the Code, including the aforesaid amount of the Notes, in an aggregate amount in excess of
<br />$10,000,000, and (ii) have not issued, do not reasonably anticipate issuing, and will not issue,
<br />tax-exempt obligations (including the aforesaid amount of the Notes, but excluding obligations,
<br />other than qualified 501(c)(3) bonds as defined in Section 145 of the Code, that are private activity
<br />bonds as defined in Section 141 of the Code and excluding refunding obligations that are not
<br />advance refunding obligations as defined in Section 149(d)(5) of the Code) in an aggregate amount
<br />exceeding $10,000,000, unless the Village first obtains a written opinion of nationally recognized
<br />bond counsel that such designation or issuance, as applicable, will not adversely affect the status of
<br />the Notes as "qualified tax-exempt obligations". Further, the Village represents and covenants that,
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