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issuance of the Bonds and the known earned income from the investment of the proceeds of sale <br /> of the Bonds pending redemption and payment of the Refunded Bonds. <br /> The Council hereby also finds and determines that the Acquired Obligations to be <br /> deposited with the Refunding Trustee and the income therefrom, together with any necessary <br /> beginning cash balance, are sufficient to redeem the Refunded Bonds and will discharge and <br /> satisfy the obligations of the City under the ordinances authorizing the issuance of the Refunded <br /> Bonds and the pledges of the City therein. Immediately upon the delivery of such Acquired <br /> Obligations to the Refunding Trustee and the deposit of any necessary beginning cash balance, the <br /> Refunded Bonds shall be deemed not to be outstanding under Ordinance Nos. 1505-88 and 1740 <br /> of the City and shall cease to be entitled to any lien, benefit or security under such ordinances <br /> except the right to receive payment from the Acquired Obligations and beginning cash balance so <br /> set aside and pledged. <br /> SECTION 16. Tax Covenants. <br /> A. No Arbitrage or Private Activity Bonds. The City hereby covenants that it will not <br /> make any use of the proceeds from the sale of the Bonds or any other funds of the City that may <br /> be deemed to be proceeds of such Bonds pursuant to Section 148 of the Code and the applicable <br /> regulations thereunder that will cause the Bonds to be "arbitrage bonds" within the meaning of <br /> said Section and said regulations. The City will comply with the applicable requirements of <br /> Section 148 of the Code (or any successor provision thereof applicable to the Bonds) and the <br /> applicable regulations thereunder throughout the term of the Bonds. <br /> The City further covenants that it will not take any action or permit any action to be taken <br /> that would cause the Bonds to constitute "private activity bonds" under Section 141 of the Code. <br /> B. Arbitrage Rebate. The City will pay the Rebate Amount, if any, to the United <br /> States of America at the times and in the amounts necessary to meet the requirements of the Code <br /> to maintain the federal income tax exemption for interest payments on the Bonds, in accordance <br /> with the Arbitrage and Tax Certification. <br /> -20- DOM_DOC 94/01/19 <br />