05-13-2020 Council Packet - Laserfiche WebLink

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12316306v3 -35- Section 5.06 Compliance with Arbitrage Restrictions; Rebate Requirements. The Issuer and the Trustee hereby acknowledge and confirm that the maintenance of the tax-exempt status of interest on the Bonds is dependent, among other things, on compliance with the arbitrage requirements set forth in Section 148 of the Internal Revenue Code and regulations thereunder. In order to confirm and carry out in part such understanding, the Borrower has agreed in the Loan Agreement, inter alia, to make or cause to be made such periodic computations and make such rebate payments to the United States as and when required by Section 148(f) of the Code and regulations thereunder. Specifically, the Borrower shall cause to be computed as of each computation date all rebatable arbitrage earned with respect to nonpurpose investments made with gross proceeds of the Bonds. Payment of all rebate payments required to be made to the United States under Section 4.08(d) of the Loan Agreement and under this Section shall be made from Loan Repayments made by the Borrower under Section 4.08(d) of the Loan Agreement or from other available funds held under this Indenture. With respect to each Installment Computation Date, such required rebate payments shall be made in the minimum amounts required by said Section 148(f) and regulations thereunder not later than 60 days after each such Installment Computation Date. Not later than 60 days after the Final Computation Date, there shall be paid from moneys provided by or on behalf of the Borrower 100 percent of the aggregate amount described above not theretofore paid to the United States. In construing this Section 5.05, all terms used in this Section shall have the meanings provided in Section 148 (f) of the Internal Revenue Code and regulations thereunder. Notwithstanding any other provision of this Section 5.05, any requirement imposed hereunder may be deemed inapplicable and of no force or effect if an opinion of Bond Counsel is rendered to the Trustee to the effect that the failure to impose such requirement will not adversely affect the tax-exempt status of interest on the Bonds. In order to comply with the provisions of this Section 5.05 or Section 4.08(d) of the Loan Agreement, the Trustee is hereby authorized to obtain such opinions of Bond Counsel, Opinions of Counsel, reports of accountants and Certificates of the Borrower as may be necessary for the purpose and any expenses thereof shall be borne by the Borrower. The Trustee is also authorized to apply amounts credited to the Optional Redemption Fund or Reserve Fund to the payment of any rebate amount then owing, as further provided in Sections 5.02 and 5.03 hereof, and to establish such other fund or account hereunder as it may deem necessary or desirable in order to maintain funds for the purpose of making any payment required under this Section 5.05. The Trustee shall not be responsible for any determination or calculation concerning arbitrage rebate with respect to the Bonds, or for determining whether the yield on any investments made in accordance with the Indenture would cause, or whether any other facts exist which would cause, any of the Bonds to become arbitrage bonds under Section 148 of the Code. [The balance of this page is intentionally left blank.]