Participant Covenants and Defaults. 7.1 Each Participant covenants and agrees: (i) to make payments to NCPA, from its Electric System Revenues, of its obligations under this Agreement as an operating expense of its Electric System; (ii) to fix the rates and charges for services provided by its Electric System, so that it will at all times have sufficient Revenues to meet the obligations of this Agreement, including the payment obligations; (iii) to make all such payments due NCPA under this Agreement whether or not there is an interruption in, interference with, or reduction or suspension of services provided under this Agreement, such payments not being subject to any reduction, whether by offset or otherwise, and regardless of whether any dispute exists; and (iv) to operate its Electric System, and the business in connection therewith, in accordance with Good Utility Practices.
Participant Covenants and Defaults. Any failure of a Participant to meet its obligations hereunder or to cure such failure in a timely manner shall constitute an Event of Default and the Defaulting Party shall be subject to such remedies of NCPA as provided for herein. Each Participant covenants and agrees: (i) to continue to pay or advance to NCPA, from its electric department Revenues only or, in the case of BART, its tariffs, fees or other sources of Revenues provided that such sources shall not include any sums derived from sources the use of which is limited by law to expenditures other than operating expenses, its obligations under this Agreement. Each Participant further agrees that it will fix the rates and charges for services provided by its electric department, or in the case of BART, its general Revenues, so that it will at all times have sufficient money in its department Revenues funds to meet this obligation; (ii) to make payments under this Agreement from the Revenues of, and as an operating expense of, its Electric System, or in the case of BART, of its general Revenues; (iii) to make payments under this Agreement whether or not there is an interruption in, interference with, or reduction or suspension of services provided under this Agreement, such payments not being subject to any reduction, whether by offset or otherwise, and regardless of whether any dispute exists provided such interruption, interference or reduction in services is caused by forces constituting an Act of God and not reasonably contemplated by the Parties; (iv) to establish and maintain a general operating reserve, in addition to the Security Account established pursuant to this Agreement, containing sufficient funds to pay all costs to operate its Electric System and the business in connection therewith for a period of three (3) months, such operating reserve to be maintained either in Participant’s own accounts or in its NCPA general operating reserve account; (v) to submit a report to NCPA once each quarter of the Fiscal Year as to the sufficiency of its general operating reserve established pursuant to Section 5.5.3(iv) on dates as established by NCPA; and (vi) to operate its Electric System and the business in connection therewith in an efficient manner and at reasonable cost and to maintain its Electric System in good repair, working order, and condition.
