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-31- <br />ARTICLE V <br />OTHER COVENANTS OF THE SUCCESSOR AGENCY <br />Section 5.01. Punctual Payment. The Successor Agencyshall punctually pay or <br />cause to be paid the principal and interest to become due in respect of all the Bondstogether <br />with the premium thereon, if any, in strict conformity with the terms of the Bonds and of this <br />Indenture. The Successor Agencyshall faithfully observe and perform all of the conditions, <br />covenants and requirements of this Indenture and all Supplemental Indentures and the Bonds. <br />Nothing herein contained shall prevent the Successor Agencyfrom making advances of its own <br />moneys howsoever derived to any of the uses or purposes referred to herein. <br />Section 5.02. Limitation on Additional Indebtedness; Against Encumbrances. The <br />Successor Agencyhereby covenants that, so long as the Bonds are Outstanding, the <br />Successor Agencyshall not issue any bonds, notes or other obligations, enter into any <br />agreement or otherwise incur any indebtedness, which is in any case payable from all or any <br />part of the Tax Revenues, excepting only as provided in this Section 5.02.The Successor <br />Agencywill not otherwise encumber, pledge or place any charge or lien upon any of the Tax <br />Revenues or other amounts pledged to the Bonds on parity to the pledge and lien herein <br />created for the benefit of the Bonds;provided,that the Successor Agency (a) may issue and sell <br />refunding bonds as Parity Debt payable from Tax Revenues on a parity withOutstanding Bonds <br />(as determined by the Successor Agency, in its sole discretion) to refund the 2008Bonds and <br />(b) may issue and sell refunding bonds as Parity Debt payable from Tax Revenues on a parity <br />with Outstanding Bondsto refund a portion of the Outstanding Bonds, provided further that, with <br />respect to any such refunding(i) annual debt service on such Parity Debt, as applicable,is <br />lower than annual debt service on the obligations being refunded during every year the <br />obligations wouldotherwise be outstanding and (ii) the final maturity of any such Parity Debt <br />does not exceed the final maturity of the obligations being refunded. Nothing herein shall <br />prevent the Successor Agency from issuing and selling Subordinate Debt. <br />Section 5.03. Extension of Payment. The Successor Agencywill not, directly or <br />indirectly, extend or consent to the extension of the time for the payment of any Bond or claim <br />for interest on any of the Bonds and will not, directly or indirectly, be a party to or approve any <br />such arrangement by purchasing or funding the Bonds or claims for interest in any other <br />manner. In case the maturity of any such Bond or claim for interest shall be extended or <br />funded, whether or not with the consent of the Successor Agency, such Bond or claim for <br />interest so extended or funded shall not be entitled, in case of default hereunder, to the benefits <br />of this Indenture, except subject to the prior payment in full of the principal of all of the Bonds <br />then Outstanding and of all claims for interest which shall not have been so extended or funded. <br />Section 5.04. Payment of Claims. The Successor Agencyshall promptly pay and <br />discharge, or cause to be paid and discharged, any and all lawful claims for labor, materials or <br />supplies which, if unpaid, might become a lien or charge upon the properties owned by the <br />Successor Agencyor upon the Tax Revenues or other amounts pledged to the payment of the <br />Bonds,or any part thereof, or upon any funds in the hands of the Trustee, or which might impair <br />the security of the Bonds. Nothing herein contained shall require the Successor Agencyto <br />make any such payment so long as the Successor Agencyin good faith shall contest the validity <br />of said claims.