Six-Month Exception Clause Samples
The Six-Month Exception clause establishes a specific rule or exemption that applies for a period of six months within the context of an agreement. Typically, this clause might allow certain actions, rights, or obligations to be suspended, modified, or exempted during the initial six months after the contract's effective date. For example, it could permit a party to terminate the agreement without penalty or delay the commencement of certain services for the first six months. The core practical function of this clause is to provide flexibility or a transitional period at the start of a contractual relationship, addressing potential uncertainties or adjustment needs during the early stages.
Six-Month Exception. Notwithstanding the fact that all of the Gross Proceeds of the Local School Bond are spent within six (6) months of the date of issue and no other Gross Proceeds of the Local School Bond are anticipated for the remainder of the term of the issue, if Gross Proceeds of the Local School Bond become available after the end of the initial six-month period, the Locality Rebate Requirement shall be computed with respect to such Gross Proceeds in accordance with the procedure described above.
Six-Month Exception. The six-month exception requires that Gross Proceeds of the Lease be allocated to Expenditures for the purposes for which the Lease is executed and delivered within the six-month period beginning on the Date of Execution and Delivery of the Lease, and that the Rebate Requirement be met for amounts not required to be spent within such six-month spending period (excluding earnings on a bona fide debt service fund). For purposes of the six-month exception, Gross Proceeds do not include amounts in a bona fide debt service fund, amounts in a reasonably required reserve or replacement fund, amounts that as of the date hereof are not reasonably expected to be Gross Proceeds but that become Gross Proceeds after the end of the six-month spending period, amounts representing Sale Proceeds or Investment Proceeds derived from Payments under any Purpose Investment financed with Proceeds of the Lease, and amounts representing repayments of grants financed by the Lease.
Six-Month Exception. The obligation to pay arbitrage rebate to the United States will be treated as satisfied if
(1) the Gross Proceeds (as modified below) are allocated to expenditures for the governmental purpose of the Lease within six months after the Issue Date; and
(2) arbitrage rebate is paid in accordance with Section 148 of the Code on all other Gross Proceeds. For purposes of paragraph (1) above, Gross Proceeds do not include amounts in a Bona Fide Debt Service Fund or amounts that become Gross Proceeds after the end of the six-month spending period, but were not expected to be Gross Proceeds as of the Issue Date (e.g., Gross Proceeds arising from a sale of the facilities financed with the Lease). The Lease meets the six- month expenditure test even if, at the end of the six-month period, Gross Proceeds not exceeding the Minor Portion remain unspent, so long as such Gross Proceeds are spent within one year after the Issue Date. The use of Gross Proceeds to pay the principal component of any Lease Payment will not be treated as an expenditure of Gross Proceeds.
Six-Month Exception. The Series 2014 Bonds are treated as meeting the Rebate Requirement under this exception if (i) the gross proceeds of the Series 2014 Bonds are allocated to expenditures for the governmental purposes of the Series 2014 Bonds within the six-month period beginning on the issue date of the Series 2014 Bonds (the “six-month spending period”) and (ii) the Rebate Requirement is met for amounts not required to be spent within the six-month spending period (excluding earnings on a bona fide debt service fund). For purposes of the six- month exception, “gross proceeds” means Gross Proceeds other than amounts (i) in a bona fide debt service fund, (ii) in a reasonably required reserve or replacement fund, (iii) that, as of the issue date, are not reasonably expected to be Gross Proceeds but that become Gross Proceeds after the end of the six-month spending period, (iv) that represent Sale Proceeds or Investment Proceeds derived from payments under any Purpose Investment of the Series 2014 Bonds and (v) that represent repayments of grants (as defined in Section 1.148-6(d)(4) of the Regulations) financed by the Series 2014 Bonds. In the case of the Series 2014 Bonds no bond of which is a private activity bond (other than a qualified 501(c)(3) bond) or a tax or revenue anticipation bond, the six-month spending period is extended for an additional six months for the portion of the proceeds of the Series 2014 Bonds which are not expended within the six-month spending period if such portion does not exceed the lesser of five percent of the Proceeds of the Series 2014 Bonds or $100,000.
Six-Month Exception. (1) The obligation to pay rebate to the United States will be treated as satisfied if—
(A) the Gross Proceeds (as modified below) are allocated to expenditures for the governmental purpose of the Bonds within 6 months after the Issue Date; and
(B) rebate is paid in accordance with Code § 148 on all Gross Proceeds not required to be spent as provided in paragraph (A) (other than amounts in a Bona Fide Debt Service Fund). Normally, this will include only Gross Proceeds in a reasonably required reserve or replacement fund.
(2) For purposes of paragraph (1)(A) above, Gross Proceeds do not include amounts in a Bona Fide Debt Service Fund or a reasonably required reserve or replacement fund, or amounts that become Gross Proceeds after the end of the 6-month spending period, but were not anticipated as of the Issue Date. The use of Gross Proceeds to pay principal of any Bond will not be treated as an expenditure of Gross Proceeds for this purpose.
(3) The 6-month spending exception generally is met if all Adjusted Gross Proceeds of the bonds are spent within 6 months following the Issue Date. The test may still be satisfied even if up to 5% of the sale proceeds remain at the end of the initial 6-month period, so long as this amount is spent within one year of the Issuer Date.
Six-Month Exception. The rebate requirement does not apply if 95% of the Gross Proceeds (other than certain types of Gross Proceeds described below) are spent for the Project within six months of the Date of Issue and 100% within one year. The Gross Proceeds not eligible for this exception, and thus subject to the rebate requirement (unless another exception applies), are: amounts in a Bona Fide Debt Service Fund, amounts in a reasonably required reserve fund (including amounts in any collateral fund for a credit facility), Gross Proceeds arising after the six month period that were not reasonably expected as the Date of Issue, and payments on the Loan Agreement. The exception will not apply if on the Date of Issue Gross Proceeds are reasonably expected to arise after the six month period.