05-13-2020 Council Packet - Laserfiche WebLink

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12316323v3 12 (n)The Borrower is an organization described in Section 501(c)(3) of the Internal Revenue Code, exempt from the payment of federal income taxes under Section 501(a) of the Code, and no revenues derived from any portion of the Project Facilities do or shall constitute revenues from an "unrelated trade or business" within the meaning of Section 513(a) of the Code, or revenues from any "private business use," except as may be specifically contemplated by Sections 145(a) and 141(b) of the Code in amounts that would not require the interest on the Series 2020 Bonds to become includable in the gross income of the recipients thereof, for purposes of Federal income taxation. In furtherance of this covenant, at least 97% of the facilities (measured by square footage and fair market rental value) financed or refinanced by the Series 2020 Bonds is to be used solely and exclusively by organizations described in Section 501(c)(3) of the Internal Revenue Code ("Tax-Exempt Organizations") in activities which do not constitute unrelated trades or businesses, determined by applying Section 513(a) of the Code, and the Borrower will not permit more than 3% of such facilities (measured by square footage and fair market rental value) to be used (i) by a Tax-Exempt Organization in an unrelated trade or business or (ii) in the trade or business of any person other than a unit of state or local government or a Tax-Exempt Organization (whether pursuant to a lease, management agreement or other arrangement), unless such use, according to an opinion of Bond Counsel, does not jeopardize the excludability from gross income, for federal income tax purposes, of interest on the Series 2020 Bonds. (o)The sum of the principal amount of the Series 2020 Bonds, plus the respective outstanding aggregate principal amounts of all other tax-exempt nonhospital bonds issued on behalf of or for the benefit of the Borrower and all organizations under common management or control with the Borrower (other than qualified hospital bonds), within the meaning of Section 145 of the Internal Revenue Code, do not exceed $150,000,000, except to the extent specifically permitted by the provisions of Section 145(b) of the Code. (p)None of the proceeds of the Series 2020 Bonds shall be used to provide an airplane, skybox or other private luxury box, facility primarily used for gambling, or store the principal business of which is the sale of alcoholic beverages for consumption off premises, and the Borrower does not expect that the Project Facilities, or any portion thereof, shall subsequently be used for any of such purposes. [The balance of this page intentionally left blank.]