|
income tax purposes, (b) it will not take or authorize to be taken any actions that would adversely
<br />affect that exclusion, and (c) it, or persons acting for it, will, among other acts of compliance, (i)
<br />apply the proceeds of the Notes to the governmental purposes of the borrowing, (ii) restrict the yield
<br />on investment property, (iii) make timely and adequate payments to the federal government, (iv)
<br />maintain books and records and make calculations and reports, and (v) refrain from certain uses of
<br />those proceeds and, as applicable, of property financed with such proceeds, all in such manner and
<br />to the extent necessary to assure such exclusion of that interest under the Code.
<br />The City hereby represents that the Outstanding Note was designated as a"qualified tax
<br />exempt obligation" pursuant to Section 265(b)(3) of the Code. The City hereby covenants that it
<br />will redeem the Outstanding Note from proceeds of, and within 90 days after issuance of, the
<br />Notes, and represents that all other conditions are met for treating the Notes as "qualified tax
<br />exempt obligations" and as not to be taken into account under subparagraph (D) of Section
<br />265(b)(3) of the Code, without necessity for further designation, by reason of subparagraph
<br />(D)(ii) of Section 265(b)(3) of the Code. Further, the City represents and covenants that, during
<br />any time or in any manner as might affect the status of the Notes as "qualified tax exempt
<br />obligations", it has not formed or participated in the formation of, or benefited from or availed
<br />itself of, any entity in order to avoid the purposes of subparagraph (C) or (D) of Section
<br />265(b)(3) of the Code, and will not form, participate in the formation of, or benefit from or avail
<br />itself of, any such entity. The City further represents that the Notes are not being issued as part
<br />of a direct or indirect composite issue that combines issues or lots of tax exempt obligations of
<br />different issuers.
<br />The Director of Finance, as the fiscal officer, or any other officer of the City having
<br />responsibility for issuance of the Notes is hereby authorized (a) to make or effect any election,
<br />selection, designation, choice, consent, approval, or waiver on behalf of the City with respect to the
<br />Notes as the City is permitted or required to make or give under the federal income tax laws,
<br />including, without limitation thereto, any of the elections provided for in Section 148( fl(4)(C) of the
<br />Code or available under Section 148 of the Code, for the purpose of assuring, enhancing or
<br />protecting favorable tax treatment or status of the Notes or interest thereon or assisting compliance
<br />with requirements for that purpose, reducing the burden or expense of such compliance, reducing
<br />the rebate amount or payments of penalties, or making payments of special amounts in lieu of
<br />making computations to determine, ar paying, excess earnings as rebate, or obviating those amounts
<br />or payments, as determined by that officer, which action shall be in writing and signed by the
<br />officer, (b) to take any and all other actions, make or obtain calculations, make payments, and make
<br />or give reports, covenants and certifications of and on behalf of the City, as may be appropriate to
<br />assure the exclusion of interest from gross income and the intended taY status of the Notes, and (c)
<br />to give one or more appropriate certificates of the City, for inclusion in the transcript of proceedings
<br />for the Notes, setting forth the reasonable expectations of the City regarding the amount and use of
<br />all the proceeds of the Notes, the facts, circumstances and estimates on which they are based, and
<br />other facts and circumstances relevant to the tax treatment of the interest on and the tax status of the
<br />Notes.
<br />Each covenant made in this Section with respect to the Notes is also made with respect to all
<br />issues any portion of the debt service on which is paid from proceeds of the Notes (and, if different,
<br />the original issue and any refunding issues in a series of refundings), to the extent such compliance
<br />- 5 -
|