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ORDINANCE NO. 2006-31 PAGE 13
<br />Section 9. Federal Tax Considerations. The Village covenants that it will use, and
<br />will restrict the use and investment of, the proceeds of the Bonds in such manner and to such
<br />extent as may be necessary so that (a) the Bonds will not (i) constitute private activity bonds,
<br />arbitrage bonds or hedge bonds under Sections 141, 148 or 149 of the Code or (ii) be treated other
<br />than as bonds to which Section 103 of the Code applies, and (b) the interest thereon will not be an
<br />item of tax preference 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 Bonds to be and to remain excluded from gross income
<br />for federal income taY purposes, and (b) it will not take or authorize to be taken any actions that
<br />would 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 Bonds to the governmental purpose of the borrowing, (ii)
<br />restrict the yield on investment property acquired with those proceeds, (iii) make timely and
<br />adequate payments to the federal government, (iv) maintain books and records and make
<br />calculations and reports, and (v) refrain from certain uses of those proceeds, and, as applicable, of
<br />property financed with such proceeds, all in such manner and to the extent necessary to assure
<br />such exclusion of that interest under the Code.
<br />The Bonds are hereby designated as "qualified tax-exempt obligations" for purposes of
<br />Section 265(b)(3) of the Code. In that connection, the Village hereby represents and covenants
<br />that it, together with all its subordinate entities or entities that issue obligations on its behalf, or on
<br />behalf of which it issues obligations, in or during the calendar year in which the Bonds are issued,
<br />(i) have not issued and will not issue tax-exempt obligations designated as "qualified tax-exempt
<br />obligations" for purposes of Section 265(b)(3) of the Code, including the Bonds, in an aggregate
<br />amount in excess of $10,000,000, and (ii) have not issued, do not reasonably anticipate issuing,
<br />and will not issue, tax-exempt obligations (including the Bonds, but excluding obligations, other
<br />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
<br />amount exceeding $10,000,000, unless the Village first obtains a written opinion of nationally
<br />recognized bond counsel that such designation or issuance, as applicable, will not adversely affect
<br />the status of the Bonds as "qualified tax-exempt obligations". Further, the Village represents and
<br />covenants that, during any time or in any manner as might affect the status of the Bonds as
<br />"qualified taY-exempt obligations", it has not formed or participated in the formation of, or
<br />benefited from or availed itself of, any entity in order to avoid the purposes of subparagraph (C) or
<br />(D) of Section 265(b)(3) of the Code, and will not form, participate in the formation of, or benefit
<br />from or avail itself of, any such entity. The Village further represents that the Bonds are not being
<br />issued as part of a direct or indirect composite issue that combines issues or lots of tax-exempt
<br />obligations of different issuers.
<br />The Director of Finance, as the fiscal officer, or any other officer of the Village having
<br />responsibility for issuance of the Bonds is hereby authorized (a) to make or effect any election,
<br />selection, designation, choice, consent, approval, or waiver on behalf of the Village with respect to
<br />the Bonds as the Village is permitted or required to make or give under the federal income tax
<br />laws, including, without limitation, any of the elections available under Section 148 of the Code,
<br />for the purpose of assuring, enhancing or protecting favorable tax treatment or status of the Bonds
<br />or interest thereon or assisting compliance with requirements for that purpose, reducing the burden
<br />or expense of such compliance, reducing the rebate amount or payments or penalties, or malcing
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