Agmt08 South Bayside System Authority AKA Silicon Valley Clean Water

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Section 12. Tax Covenants. (a) Private Business Use Limitation. The City shall assure that the Sewer Utility System is not used in a manner which would cause any issue of Bonds to satisfy the private business tests of Section 141(b) of the Tax Code or the private loan financing test of Section 141(c) of the Tax Code. (b) Federal Guarantee Prohibition. The City may not take any action or permit or suffer any action to be taken with respect to the Sewer Utility System if the result of the same would be to cause any issue of Bonds to be federally guaranteed" within the meaning of Section 149(b) of the Tax Code. (c) Rebate of Excess Investment Earnings to United States. The Authority shall calculate or cause to be calculated the amount of excess investment earnings on the Bonds in all respects at the times and in the manner required under the Tax Code, and shall pay the full amount of any such excess investment earnings to the United States of America when and as due. In the event and to the extent the Authority reasonably determines that any such excess investment earnings are allocable to the City, the City shall pay the amount thereof to the Authority from available Net Revenues. Section 13. Cooperation with Bond Issuance. The City agrees that it will execute and deliver any and all such closing certificates, agreements, instruments or other assurances as may be reasonably necessary or requested by the Authority to consummate the issuance and sale of the Bonds. Without limiting the generality of the foregoing, the City agrees to: (a) furnish the Authority such financial and operating information as the Authority shall reasonably request for disclosure in any official statement or other prospectus which is prepared in connection with the issuance of the Bonds; and (b) execute and deliver a Continuing Disclosure Certificate in connection with each series of Bonds, in substantially the form attached hereto as Appendix B. Section 14. Termination or Amendment. In the event that the Authority assumes responsibility for setting rates and receiving revenues of the Sewer Utility System, the City and the Authority may declare the City's obligations hereunder discharged in whole or in part by termination or amendment of this Agreement. Section 15. Governing Law. This Agreement will be construed in accordance with and governed by the laws of the State of California. Section 16. Binding Effect. This Agreement mures to the benefit of and is binding upon the Authority, the City and their respective successors and assigns, subject, however, to the limitations contained herein. Section 17. Severability of Invalid Provisions. If any one or more of the provisions contained in this Agreement are for any reason held to be invalid, illegal or unenforceable in any respect, then such provision or provisions will be deemed severable from the remaining provisions contained in this Agreement and such invalidity,