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The foregoing conditions shall not apply with respect to <br />Additional Parity Bonds the proceeds of which will be used to <br />complete a project a substantial portion of the cost of which has <br />been or will be paid out of the proceeds of Bonds issued hereunder. <br />Each resolution authorizing the issuance of Additional <br />Parity Bonds shall recite that all of the covenants herein <br />contained will be applicable to such Additional Parity Bonds. <br />Additional Parity Bonds may not be issued hereunder at <br />any time at which the County is in default in performing any of <br />the covenants and obligations assumed hereunder, or all payments <br />herein required to have been made into the accounts and funds, as <br />provided hereunder, have not been made to the full extent required. <br />R. PURCHASE OF SYSTEM. The County will purchase the <br />System as soon as practicable. <br />S. MANAGEMENT OF SYSTEM. The County in operating the <br />System will employ persons of demonstrated ability and experience <br />and will require all employees who may have possession of moneys <br />derived from operation of the System to be covered by a fidelity <br />bond written by a responsibility indemnity company in an amount <br />sufficient to protect the County from loss. <br />T. CONNECTION WITH SYSTEM. The County will, to the <br />full extent permitted by law, require all lands, buildings, <br />residences and other structures within its territorial boundaries <br />which can use the System to connect therewith and use the System <br />and cease to use any other potable water system. <br />U. ARBITRAGE. The County covenants to and with <br />purchasers of the issue which constitutes the Series 1988 Bonds <br />that it will make no use of the proceeds of such issue which will <br />cause the Series 1988 Bonds to be or become "arbitrage bonds" <br />within the meaning of Section 103(b)(2) and Section 148 of the <br />Internal Revenue Code of 1986, as amended (the "Code"), and the <br />regulations implementing said Sections that duly have been <br />published in the Federal Register or with any other applicable <br />regulations implementing said Sections, and the County further <br />covenants to comply with all other requirements of the Code if and <br />to the extent applicable to maintain continuously the Federal <br />income tax exemption of interest on the Series 1988 Bonds. <br />V. FUNDS AND ACCOUNTS. The designation and <br />establishment of the various funds and accounts created herein does <br />not require the establishment of any completely independent, self- <br />balancing funds as such term is ,ommonly defined and used in <br />governmental accounting, but rather is intended solely to <br />constitute an earmarking of certain revenues and assets as provided <br />herein. <br />20 <br />