Common use of Parity Obligations Clause in Contracts

Parity Obligations. City further covenants that, except for financing obligations solely issued to fully or partially refund the Installment Payments or any other Parity Obligations and to pay related costs of issuance, the City shall not issue or incur any Parity Obligations unless: Agreement; (i) The City is not in default under the terms of this Installment Sale (ii) The City shall have delivered to the Authority a Certificate of the City demonstrating that Net Wastewater System Revenue, calculated on sound accounting principles, as shown by the books of City for the last audited Fiscal Year or twelve (12) calendar month period during the immediately preceding eighteen (18) calendar month period, plus, at the option of the City the additional allowance described below, shall have amounted to at least 1.20 times the sum of the Installment Payments and any other amount required to be paid hereunder coming due and payable in any future Fiscal Year and the maximum annual debt service for any future Fiscal Year on all Parity Obligations and Subordinate Obligations outstanding immediately subsequent to the incurring of such proposed Parity Obligations in the Fiscal Year in which such sum is the greatest; and Either or both of the following items may be added to such Net Wastewater System Revenue for the purpose of applying the restriction contained in this subsection (b)(ii): (A) an allowance for Net Wastewater System Revenue from any additions to or improvements or extensions of the Wastewater System to be constructed or acquired with the proceeds of such additional obligations, and also for Net Wastewater System Revenue from any such additions, improvements or extensions which have been constructed or acquired from moneys from any source but which, during all or any part of such Fiscal Year or twelve (12) month period, were not in service, all in an amount equal to 90% of the estimated additional annual Net Wastewater System Revenue to be derived from such additions, improvements and extensions during the first full Fiscal Year following the completion thereof, all as shown by such Certificate of the City may be added to such Net Wastewater System Revenue for the purpose of applying the restriction contained in this subsection (b)(ii); (B) an allowance for earnings arising from any increase in the rates, fees and charges fixed and prescribed for Wastewater Service which has become effective prior to the incurring of such proposed Parity Obligations but which, during all or any part of such Fiscal Year or twelve (12) month period, was not in effect, in an amount equal to 90% of the amount by which the Net Wastewater System Revenue would have been increased if such increase in rates, fee and charges had been in effect during the whole of such Fiscal Year or twelve (12) month period, as shown by such Certificate of the City. The provisions of subsection (b)(ii) of this Section shall not apply to any Parity Obligations if all of the proceeds of which (other than proceeds applied to pay costs of issuing such Parity Obligations and to make the reserve fund deposit required pursuant to subsection (b)(iii) of this Section) shall be deposited in an irrevocable escrow held in cash or invested in Federal Securities for the purpose of paying the principal of and interest and premium (if any) on any outstanding Parity Obligations, if (x) at the time of the incurring of such Parity Obligations, City certifies in writing that maximum annual debt service on such Parity Obligations will not exceed Maximum Annual Debt Service on the Parity Obligations to be refunded, and (y) the final maturity of such Parity Obligations is not later than the final maturity of the refunded Parity Obligations. In order to maintain the parity relationship of the obligations of the City under this Installment Sale Agreement to all Parity Obligations permitted hereunder, the City covenants that all payments in the nature of principal and interest or reserve account replenishment with respect to any Parity Obligations will be structured to occur semi-annually on the Installment Payment Datesin each year with respect to the Installment Payments, and reserve account replenishment with respect to any Parity Obligations will be structured to occur monthly, and to otherwise structure the terms of such Parity Obligations to ensure that they are in all respects payable on a parity with the obligations of the City under this Installment Sale Agreementand not prior thereto. (iii) There shall be established from the proceeds of such Parity Obligations a reserve fund for the security of such Parity Obligations, in an amount equal to the lesser of (1) the maximum amount of debt service required to be paid by City with respect to such Parity Obligations during any Fiscal Year, or (2) the maximum amount then permitted under the Code, in either event as certified in writing by City.

Parity Obligations. The City further covenants that, except for financing obligations solely issued to fully or partially refund the Installment Payments or any other Parity Obligations and to pay related costs of issuance, the City shall that it will not issue or incur any Parity Obligations unless: Agreement;: (i) The City is not in default under the terms of this Installment SaleSale Agreement or any agreements relating to then existing Parity Obligations; (ii) The City shall have delivered to the Authority a Certificate of the City demonstrating that (A) Net Wastewater System RevenueRevenues, calculated on sound accounting principles, as shown by the books of the City for the last audited latest Fiscal Year or any twelve (12) calendar month period during the immediately preceding eighteen (18) calendar month period, plus, at the option out of the most recent eighteen months selected by the City ending not more than sixty (60) days prior to the additional allowance described belowadoption of the resolution pursuant to which such Parity Obligations are authorized to be issued or incurred, as shown by the books of the City, shall have amounted to at least 1.20 1.25 times the sum maximum amount of the Installment Payments and any other amount required to be paid hereunder coming due and payable in any future Fiscal Year and the maximum annual debt service for any future Fiscal Year on all Parity Obligations and Subordinate Obligations outstanding immediately subsequent to the incurring of such proposed Parity Obligations additional obligations coming due and payable in the any future Fiscal Year in which such sum is the greatest; and Year. Either or both of the following items may be added to such Net Wastewater System Revenue Revenues for the purpose of applying the restriction contained in this subsection (b)(iib)(ii)(A): (A1) an An allowance for Net Wastewater System Revenue revenues to be derived from any additions to or improvements or extensions of the Wastewater Water System to be constructed or acquired with the proceeds of such additional obligations, and also for Net Wastewater System Revenue from any such additions, improvements or extensions which have been constructed or acquired from moneys from any source but which, during all or any part of such Fiscal Year or the twelve (12) month periodperiod out of the most recent eighteen months selected by the City ending not more than sixty (60) days prior to the adoption of the resolution pursuant to which such Parity Obligations are authorized to be issued or incurred, were not in service, all in an amount equal to 90100% of the estimated additional average annual Net Wastewater System Revenue Revenues to be derived from such additions, improvements and extensions during the first full Fiscal Year following the completion thereofextensions, all as shown by such Certificate the certificate or opinion of a qualified independent consultant employed by the City may be added to such Net Wastewater System Revenue for the purpose of applying the restriction contained in this subsection (b)(ii);City. (B2) an An allowance for earnings arising from any increase in the rates, fees and charges fixed and prescribed made for Wastewater Service service from the Water System which has become effective prior to the incurring of such proposed Parity Obligations but which, during all or any part of such Fiscal Year or the twelve (12) month periodperiod out of the most recent eighteen months selected by the City ending not more than sixty (60) days prior to the adoption of the resolution pursuant to which such Parity Obligations are authorized to be issued or incurred, was not in effect, in an amount equal to 90100% of the amount by which the Net Wastewater System Revenue Revenues would have been increased if such increase in rates, fee and charges had been in effect during the whole of such Fiscal Year or the twelve (12) month periodperiod out of the most recent eighteen months selected by the City ending not more than sixty (60) days prior to the adoption of the resolution pursuant to which such Parity Obligations are authorized to be issued or incurred, as shown by such Certificate the certificate or opinion of a qualified independent consultant employed by the City. The provisions of subsection (b)(ii) of this Section shall not apply to any Parity Obligations if all of the proceeds of which (other than proceeds applied to pay costs of issuing such Parity Obligations and to make the reserve fund deposit required pursuant to subsection (b)(iii) of this Section) shall be deposited in an irrevocable escrow held in cash or invested in Federal Securities for the purpose of paying the principal of and interest and premium (if any) on any outstanding Parity Obligations, if (x) at the time of the incurring of such Parity Obligations, City certifies in writing that maximum annual debt service on such Parity Obligations will not exceed Maximum Annual Debt Service on the Parity Obligations to be refunded, and (y) the final maturity of such Parity Obligations is not later than the final maturity of the refunded Parity Obligations. In order to maintain the parity relationship of the obligations of the City under this Installment Sale Agreement to all Parity Obligations permitted hereunder, the City covenants that all payments in the nature of principal and interest or reserve account replenishment with respect to any Parity Obligations will be structured to occur semi-annually on the Installment Payment Datesin each year with respect to the Installment Payments, and reserve account replenishment with respect to any Parity Obligations will be structured to occur monthly, and to otherwise structure the terms of such Parity Obligations to ensure that they are in all respects payable on a parity with the obligations of the City under this Installment Sale Agreementand not prior thereto. (iii) There shall be established from the proceeds of such Parity Obligations a reserve fund for the security of such Parity Obligations, in an amount equal to the lesser of (1) the maximum amount of debt service required to be paid by City with respect to such Parity Obligations during any Fiscal Year, or (2) the maximum amount then permitted under the Code, in either event as certified in writing by City.; or

Parity Obligations. City The Authority further covenants that, except for financing obligations solely issued incurred to fully prepay or partially refund post a security deposit for the Installment Payments payment of the Bonds or any other Parity Obligations and to pay related costs of issuanceObligations, the City shall not Authority may issue or incur any Parity Obligations unless: Agreement;during the term of the Bonds if: (i) The City Authority is not in default under the terms of this Installment SaleIndenture unless such default shall be cured simultaneously with the issuance of such Parity Obligations; and (ii) The City shall have delivered to Authority obtains or provides a certificate prepared by an Independent Accountant or Independent Financial Consultant showing that the Authority a Certificate of the City demonstrating that Net Wastewater System Revenue, calculated on sound accounting principles, Revenues as shown by the books of the Authority or City for any 12 consecutive calendar months during the last audited Fiscal Year or twelve (12) 18 calendar month period during ending prior to the immediately preceding eighteen (18) calendar month periodincurring of such Parity Obligations, plus, at or the option of the City the additional allowance described belowmost recent audited financial statement available, shall have amounted to at least 1.20 times the sum 120% of the Installment Payments Maximum Aggregate Annual Debt Service for all Bonds and Parity Obligations to be outstanding immediately after incurring such additional Parity Obligations. For purposes of this calculation, Net Revenues shall be calculated without regard to allocation of the City’s administrative overhead costs to the Enterprise. For purposes of preparing the certificate described in subsection (b)(ii) of this Section, as set forth above, the Independent Accountant or Independent Financial Consultant may rely upon financial statements prepared by the Authority or City, which have not been subject to audit by an independent certified public accountant if audited financial statements for the Fiscal Year or period are not available. For purposes of demonstrating compliance with the foregoing, Net Revenues may be adjusted (at the option of the Authority) to include the Additional Revenues. If interest on any other Parity Obligation is reasonably anticipated to be reimbursed to or on behalf of the Authority by the United States of America, then interest payments with respect to such Parity Obligations shall be excluded by the amount required of such interest reasonably anticipated to be paid hereunder coming due or reimbursed by the United States of America, and payable in any future Fiscal Year and the maximum annual debt service such reimbursements will not be included as Revenues for any future Fiscal Year on all Parity Obligations and Subordinate Obligations outstanding immediately subsequent to the incurring of such proposed Parity Obligations in the Fiscal Year in which such sum is the greatest; and Either or both purposes of the following items may be added to such Net Wastewater System Revenue for the purpose of applying the restriction contained coverage calculations required in this subsection (b)(ii): (A) an allowance for Net Wastewater System Revenue from any additions to or improvements or extensions of the Wastewater System to be constructed or acquired with the proceeds of such additional obligations, and also for Net Wastewater System Revenue from any such additions, improvements or extensions which have been constructed or acquired from moneys from any source but which, during all or any part of such Fiscal Year or twelve (12) month period, were not in service, all in an amount equal to 90% of the estimated additional annual Net Wastewater System Revenue to be derived from such additions, improvements and extensions during the first full Fiscal Year following the completion thereof, all as shown by such Certificate of the City may be added to such Net Wastewater System Revenue for the purpose of applying the restriction contained in this subsection (b)(ii); (B) an allowance for earnings arising from any increase in the rates, fees and charges fixed and prescribed for Wastewater Service which has become effective prior to the incurring of such proposed Parity Obligations but which, during all or any part of such Fiscal Year or twelve (12) month period, was not in effect, in an amount equal to 90% of the amount by which the Net Wastewater System Revenue would have been increased if such increase in rates, fee and charges had been in effect during the whole of such Fiscal Year or twelve (12) month period, as shown by such Certificate of the CitySection. The provisions of subsection (b)(ii) of this Section shall not apply to any Parity Obligations if all of the proceeds of which (other than proceeds applied to pay costs of issuing such Parity Obligations and to make the a reserve fund deposit required pursuant to subsection (b)(iii) of this Sectiondeposit) shall be deposited in an irrevocable escrow held in cash or invested in Federal Securities for the purpose of paying the principal of and interest and premium (if any) on any Outstanding Bonds or on any outstanding Parity Obligations, if (xi) at the time of the incurring of such Parity Obligations, the City certifies in writing that maximum annual debt service Maximum Aggregate Annual Debt Service on such Parity Obligations will not exceed Maximum Aggregate Annual Debt Service on the Outstanding Bonds or Parity Obligations to be refunded, and (yii) the final maturity of such Parity Obligations is not later than the final maturity of the refunded Bonds or Parity Obligations. In order to maintain the parity relationship of the obligations of the City under this Installment Sale Agreement Debt Service payments to all Parity Obligations permitted hereunder, the City Authority covenants that all payments in the nature of principal and interest or reserve account replenishment with respect to any Parity Obligations Obligations, except with respect to Governmental Loans, will be structured to occur semi-annually on the Installment Payment Datesin Record Dates and in each year as such payments are due with respect to the Installment PaymentsDebt Service payments, and reserve account replenishment with respect to any Parity Obligations Obligations, except with respect to Governmental Loans, will be structured to occur monthly, and to otherwise structure the terms of such Parity Obligations to ensure that they are in all respects payable on a parity with the obligations of the City under this Installment Sale Agreementand Debt Service payments and not prior thereto. (iii) There ; provided that the Authority shall be established from not make a payment on such Governmental Loan to the proceeds extent it would have the effect of such causing the Authority to fail to pay Debt Service payments of the Bonds or Parity Obligations on a reserve fund for timely basis. In such event, the security of Authority shall make Debt Service payments and payments on such Parity Obligations, in an amount equal to the lesser of (1) the maximum amount of debt service required to be paid by City with respect to such Parity Obligations during any Fiscal Year, or (2) the maximum amount then permitted under the Code, in either event as certified in writing by CityGovernmental Loan on a pro rata basis.

Parity Obligations. City further covenants thatIssuer shall not be permitted to create or permit the creation of indebtedness payable from the Revenues on an equal and parity basis with the lien of this Indenture, except for financing obligations solely except, with respect to Additional Debentures issued to fully in strict compliance with this Indenture or partially refund the Installment Payments or any other Parity Obligations and to pay related costs permissible forms of issuancedebt as set forth below (collectively, the City “Permissible Parity Debt”). Before any Permissible Parity Debt is issued or incurred, there shall not issue or incur any Parity Obligations unless: Agreement; be delivered to Trustee the items required for the issuance of Debentures by Section 2.08 of this Indenture, plus a statement by a Qualified Accountant reciting the opinion, based upon necessary investigation, (i) The City is not in default under that the terms Net Revenues of this Installment Sale (ii) The City shall have delivered to the Authority a Certificate of the City demonstrating that Net Wastewater System Revenue, calculated on sound accounting principles, as shown by the books of City Issuer for the last audited two (2) Fiscal Year or twelve (12) calendar month period during the Years immediately preceding eighteen (18) calendar month period, plus, at the option of the City the additional allowance described below, shall have amounted to at least 1.20 times the sum of the Installment Payments and any other amount required to be paid hereunder coming due and payable in any future Fiscal Year and the maximum annual debt service for any future Fiscal Year on all Parity Obligations and Subordinate Obligations outstanding immediately subsequent to the incurring of such proposed Parity Obligations in the Fiscal Year in which such sum is the greatest; and Either Permissible Parity Debt are to be issued or both incurred were not less than three hundred percent (300%) of the following items may be added to such Net Wastewater System Revenue for average Annual Debt Service on all then-Outstanding Debentures, the purpose Operating Line of applying Credit, any Parity Debt and Subordinate Obligations, plus the restriction contained in this subsection (b)(ii): (A) an allowance for Net Wastewater System Revenue from any additions to or improvements or extensions of the Wastewater System Permissible Parity Debt then proposed to be constructed issued or acquired with incurred, or (ii) in the event that the proceeds of such additional obligationsthe Permissible Parity Debt will be used to fund the acquisition, and also for Net Wastewater System Revenue from any such additions, improvements in whole or extensions which have been constructed or acquired from moneys from any source but which, during all or any in part of such an additional business, that the Net Revenues of Issuer, together with the audited Net Revenues of the business to be acquired, restated on a combined basis in accordance with GAAP procedures, for the two (2) Fiscal Years immediately preceding the Fiscal Year in which such Permissible Parity Debt are to be issued or twelve (12) month period, incurred were not in service, all in an amount equal to 90% less than three hundred percent (300%) of the estimated additional annual Net Wastewater System Revenue average Annual Debt Service on all then-Outstanding Debentures, the Operating Line of Credit, any Parity Debt and Subordinate Obligations, plus the Permissible Parity Debt then proposed to be derived from such additions, improvements and extensions during the first full Fiscal Year following the completion thereof, all as shown by such Certificate of the City may be added to such Net Wastewater System Revenue for the purpose of applying the restriction contained in this subsection (b)(ii); (B) an allowance for earnings arising from any increase in the rates, fees and charges fixed and prescribed for Wastewater Service which has become effective prior to the incurring of such proposed issued or incurred. No Permissible Parity Obligations but which, during all or any part of such Fiscal Year or twelve (12) month period, was not in effect, in an amount equal to 90% of the amount by which the Net Wastewater System Revenue would have been increased if such increase in rates, fee and charges had been in effect during the whole of such Fiscal Year or twelve (12) month period, as shown by such Certificate of the City. The provisions of subsection (b)(ii) of this Section shall not apply to any Parity Obligations if all of the proceeds of which (other than proceeds applied to pay costs of issuing such Parity Obligations and to make the reserve fund deposit required pursuant to subsection (b)(iii) of this Section) Debt shall be deposited in an irrevocable escrow held in cash issued or invested in Federal Securities for the purpose of paying the principal of and interest and premium (if any) on any outstanding Parity Obligations, if (x) incurred unless there is no default at the time of the incurring of such Parity Obligations, City certifies in writing that maximum annual debt service on such Parity Obligations will not exceed Maximum Annual Debt Service on the Parity Obligations to be refunded, and (y) the final maturity of such Parity Obligations is not later than the final maturity of the refunded Parity Obligations. In order to maintain the parity relationship of the obligations of the City issuance under this Installment Sale Agreement to all Parity Obligations permitted hereunder, the City covenants that all payments in the nature Indenture or Operating Line of principal and interest or reserve account replenishment with respect to any Parity Obligations will be structured to occur semi-annually on the Installment Payment Datesin each year with respect to the Installment Payments, and reserve account replenishment with respect to any Parity Obligations will be structured to occur monthly, and to otherwise structure the terms of such Parity Obligations to ensure that they are in all respects payable on a parity with the obligations of the City under this Installment Sale Agreementand not prior theretoCredit. (iii) There shall be established from the proceeds of such Parity Obligations a reserve fund for the security of such Parity Obligations, in an amount equal to the lesser of (1) the maximum amount of debt service required to be paid by City with respect to such Parity Obligations during any Fiscal Year, or (2) the maximum amount then permitted under the Code, in either event as certified in writing by City.