Common use of Tax Status of Bonds Clause in Contracts

Tax Status of Bonds. The Borrower hereby covenants, represents and agrees as follows: (a) the Borrower has not knowingly taken and will not knowingly take or permit to be taken any action that would have the effect, directly or indirectly, of causing interest on any of the Bonds to be included in gross income for federal income tax purposes and, if it should take or permit to be taken any such action, the Borrower shall take all lawful actions that it can take to rescind such action promptly upon having knowledge thereof; (b) the Borrower will take such action or actions, including amending the Loan, the Note, and the Deed of Trust as may be reasonably necessary in the opinion of Bond Counsel, to comply fully with all applicable rules, rulings, policies, procedures, regulations or other official statements promulgated or proposed by the United States Department of the Treasury or the Internal Revenue Service under Section 145 of the Code which are applicable to the Bonds; (c) the Borrower will take no action or permit or suffer to be taken any action the result of which would cause the Bonds to be “federally guaranteed” within the meaning of Section 149(b) of the Code; (d) no portion of the proceeds of the Bonds shall be used to provide any airplane, skybox or other private luxury box, facility primarily used for gambling, or store the principal business of which is the sale of alcoholic beverages for consumption off premises; (e) the Borrower is aware of the provisions of Section 150(b)(3) of the Code and covenants that any use of the Project by other than an organization described in Section 501(c)(3) of the Code or a governmental unit (as described in Section 145 of the Code) will not be such as to cause the Borrower to violate the covenant contained in Section 2.2(e) hereof; (f) the Borrower covenants and agrees that it will not use or permit the use of any of the funds provided by the Authority hereunder or any other funds of the Borrower, directly or indirectly, or direct the Trustee to invest any funds held by it hereunder or under the Indenture, in such manner as would, or enter into, or allow any “related person” (as defined in Section 147(a)(2) of the Code) to enter into, any arrangement, formal or informal, for the purchase of the Bonds that would, or take or omit to take any other action that would cause any Bond to be an “arbitrage bond” within the meaning of Section 148 of the Code or “federally guaranteed” within the meaning of Section 149(b) of the Code and applicable regulations promulgated from time to time thereunder; (g) in the event that at any time the Borrower is of the opinion or becomes otherwise aware that for purposes of this Section 6.4 or Section 7.13 of the Indenture it is necessary to restrict or to limit the yield on the investment of any moneys held by the Trustee under the Indenture, the Borrower shall determine the limitations and so instruct the Trustee in writing (with a copy to the Authority) and cause the Trustee to comply with those limitations under the Indenture; (h) the Borrower will take such action or actions as may be reasonably necessary in the opinion of Bond Counsel, or of which it otherwise becomes aware, to comply fully with Section 148 of the Code; (i) the Borrower will take such action or actions as necessary to ensure compliance with Sections 7.13 and 7.14 of the Indenture; and (j) the Borrower shall not, pursuant to an arrangement, formal or informal, purchase Bonds in an amount related to the amount of the Loan. The Authority covenants that it will not knowingly take or knowingly permit to be taken any action which will cause interest on the Bonds to become includable in gross income for federal income tax purposes; provided that none of the covenants and agreements herein contained shall require any of the Borrower, the Trustee or the Authority to enter an appearance or intervene in any administrative, legislative or judicial proceeding in connection with any changes in applicable laws, rules or regulations or in connection with any decisions of any court or administrative agency or other governmental body affecting the exclusion from gross income for federal income tax purposes of interest on the Bonds; and provided further that the Authority’s responsibility under this paragraph shall be limited to actions within its control and to only such actions as are permitted or required to be undertaken under the terms of the Indenture, this Agreement or the Regulatory Agreement.

Tax Status of Bonds. The It is intended that the interest on the Bonds be excluded from gross income for Federal income tax purposes pursuant to Sections 103(a) and 142 of the Internal Revenue Code. In general, the Borrower hereby covenantsagrees that it will take no action which would (and will omit no action the omission of which would) cause an Event of Taxability. Without limiting the generality of such covenant, represents and agrees as followsthe Borrower agrees: (a) that its requisitions from the Borrower has not knowingly taken Construction Fund will be such that at least 95% of the funds deposited therein and will not knowingly take or permit to be taken any action that would have the effect, directly or indirectly, of causing interest on any earnings thereon of the Bonds will be used for the acquisition, construction, reconstruction or improvement of land or property of a character subject to be included in gross income the allowance for federal income tax purposes and, if it should take or permit to be taken any such action, the Borrower shall take all lawful actions that it can take to rescind such action promptly upon having knowledge thereofdepreciation; (b) that the Borrower will take such action or actions, including amending the Loan, the Note, and the Deed of Trust as may be reasonably necessary in the opinion of Bond Counsel, to comply fully with all applicable rules, rulings, policies, procedures, regulations or other official statements promulgated or proposed issuance costs financed by the United States Department Bonds will not exceed 2% of the Treasury or the Internal Revenue Service under Section 145 aggregate face amount of the Code which are applicable to the Bondsissue; (c) that not more than 25% of the Borrower funds deposited in the Construction Fund and earnings thereon the Bonds will take no action or permit or suffer be used to be taken any action provide a facility the result primary purpose of which would cause the Bonds to be “federally guaranteed” within the meaning of Section 149(b) is one of the Codefollowing: retail food and beverage services, automobile sales or service, or the provision of recreation or entertainment; (d) that no portion of the proceeds of the Bonds shall will be used to provide the following: any airplaneprivate or commercial golf course, skybox country club, massage parlor, tennis club, skating facility (including roller skating, skateboard and ice skating), racquet sports facility (including any handball or other private luxury boxracquetball court), hot tub facility, suntan facility primarily used for gambling, or store the principal business of which is the sale of alcoholic beverages for consumption off premisesracetrack; (e) the Borrower is aware that no portion of the provisions of Section 150(b)(3) proceeds of the Code and covenants that Bonds will be used for the acquisition of any property (or an interest therein) unless either (i) the first use of such property is pursuant to such acquisition, (ii) in the Project by case of any building (and the equipment therefor) the rehabilitation expenditures with respect to such building incurred within two years after the Bonds are issued equal or exceed 15% of the portion of the cost of acquiring such building (and equipment) financed with the net proceeds of the Bonds, or (iii) in the case of structures other than an organization described in Section 501(c)(3) a building, the rehabilitation expenditures with respect to such structures incurred within two years after the Bonds are issued equal or exceed 100% of the Code or a governmental unit (as described in Section 145 portion of the Code) will not be cost of acquiring such as to cause structures financed with the Borrower to violate net proceeds of the covenant contained in Section 2.2(e) hereofBonds; (f) that less than 25% of the Borrower covenants funds deposited in the Construction Fund and agrees earnings thereon will be used (directly or indirectly) for the acquisition of land (or on interest therein); (g) that it will not use or permit the no use of any of the funds provided by the Authority hereunder or any other funds of the Borrower, directly or indirectly, or direct the Trustee to invest any funds held by it hereunder or under the Indenture, in such manner as would, or enter into, or allow any “related person” (as defined in Section 147(a)(2) of the Code) to enter into, any arrangement, formal or informal, for the purchase proceeds of the Bonds that would, or take or omit to take any other action that which would cause any Bond the Bonds to be an classified as “arbitrage bondbonds” within the meaning of Section 148 of the Code or “federally guaranteed” within Internal Revenue Code, and (h) that the meaning of Project will be used at all times as a solid waste disposal facility as defined in Section 149(b) 142 of the Code and applicable regulations promulgated from time to time thereunder; (g) at least 65% by weight or volume of the materials used in the event that conversions process at any time the Borrower is of the opinion or becomes otherwise aware that for purposes of this Project will be solid waste as defined in Section 6.4 or Section 7.13 of the Indenture it is necessary to restrict or to limit the yield on the investment of any moneys held by the Trustee under the Indenture, the Borrower shall determine the limitations and so instruct the Trustee in writing (with a copy to the Authority) and cause the Trustee to comply with those limitations under the Indenture; (h) the Borrower will take such action or actions as may be reasonably necessary in the opinion of Bond Counsel, or of which it otherwise becomes aware, to comply fully with Section 148 142 of the Code; (i) that it shall pay any rebate amount required to be paid on behalf of the Borrower will take Issuer to the United States Treasury pursuant to Section 148(f) of the Internal Revenue Code and any proposed, temporary or final regulations promulgated thereunder and, to assure payment of such action or actions as necessary amount, that it shall pay to ensure compliance with Sections 7.13 and 7.14 the Trustee any amount required to be deposited into the Rebate Account pursuant to Section 803 of the Indenture; and (j) . If, nevertheless, an Event of Taxability shall occur, the Borrower shall not, pursuant not be deemed to an arrangement, formal or informal, purchase Bonds be in an amount related to the amount default under this Section 7.06 if it complies in all respects with Section 5.02 of this Loan Agreement. Prepayment of the Loan. The Authority covenants that it will not knowingly take or knowingly permit to Loan shall be taken any action which will cause interest on the Bonds to become includable in gross income for federal income tax purposes; provided that none sole liability of the covenants and agreements herein contained shall require any Borrower for an Event of the Borrower, the Trustee or the Authority to enter an appearance or intervene in any administrative, legislative or judicial proceeding in connection with any changes in applicable laws, rules or regulations or in connection with any decisions of any court or administrative agency or other governmental body affecting the exclusion from gross income for federal income tax purposes of interest on the Bonds; and provided further that the Authority’s responsibility under this paragraph shall be limited to actions within its control and to only such actions as are permitted or required to be undertaken under the terms of the Indenture, this Agreement or the Regulatory AgreementTaxability.