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ARTICLE IX
<br />PARTICULAR REPRESENTATIONS AND COVENANTS
<br />Section 9 O 1 Payment of the Bonds
<br />While any of the Bonds are outstanding and unpaid, there shall be made available to the Paying
<br />Agent/Registrar, out of the Interest and Smkmg Fund, money sufficient to pay the interest on and the principal
<br />of the Bonds, as applicable, as will accrue or mature on each applicable Interest Payment Date
<br />Section 9 02 Other Representations and Covenants
<br />(a) The Crty will faithfully perform at all times any and all covenants, undertakings, stipulations,
<br />and provisions contained m this Ordinance and m each Bond, the City will promptly pay or cause to be paid
<br />the principal of, interest on, and premium, if any, with respect to, each Bond on the dates and at the places and
<br />manner prescribed m such Bond, and the Crty will, at the times and m the manner prescribed by this Ordinance,
<br />deposit or cause to be deposited the amounts of money specified by this Ordinance
<br />(b) The Crty is duly authorized under the laws of the State of Texas to issue the Bonds, all action
<br />on its part for the creation and issuance of the Bonds has been duly and effectively taken, and the Bonds m the
<br />hands of the Owners thereof are and will be valid and enforceable obligations of the Crty m accordance with
<br />their terms
<br />Section 9 03 Covenants Re ag rdmg Tax Exemption of Interest on the Bonds
<br />(a) The Crty covenants to take any action necessary to assure, or refrain from any action which
<br />would adversely affect, the treatment of the Bonds as obligations described m section 103 of the Internal
<br />Revenue Code of 1986, as amended (the "Code"), the interest on which is not includable m the "gross income"
<br />of the holder for purposes of federal income taxation. In furtherance thereof, the Crty covenants as follows
<br />(1) to take any action to assure that no more than 10 percent of the proceeds of the Bonds or
<br />the projects financed therewith (less amounts deposited to a reserve fund, if any) are used for any
<br />"pnvate business use," as defined m section 141(b)(6) of the Code or, if more than 10 percent of the
<br />proceeds or the projects financed therewith are so used, such amounts, whether or not received by the
<br />Crty, with respect to such pnvate business use, do not, under the terms of this Ordinance or any
<br />underlying arrangement, directly or indirectly, secure or provide for the payment of more than 10
<br />percent of the debt service on the Bonds, m contravention of section 141(b)(2) of the Code,
<br />(2) to take any action to assure that m the event that the "prwate business use" described m
<br />subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the projects financed therewith
<br />(less amounts deposited into a reserve fund, if any) then the amount m excess of 5 percent ~s used for
<br />a "private business use" which is "related" and not "disproportionate," within the meaning of section
<br />141(b)(3) of the Code, to the governmental use,
<br />(3) to take any action to assure that no amount which is greater than the lesser of $5,000,000,
<br />or 5 percent ofthe proceeds ofthe Bonds (less amounts deposited into a reserve fund, if any) is directly
<br />or indirectly used to finance loans to persons, other than state or local governmental units, m
<br />contravention of section 141(c) of the Code,
<br />San Marcos GO 2007 Ordinance 24
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