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ARTICLE 2 <br />DISBURSEMENT AND ACCOUNTING; USE OF FUNDS <br /> <br />2.1 Disbursement. Loan Proceeds may be disbursed to the Successor Agency upon <br />the receipt of a drawdown request executed by the City Finance Director, in his capacity <br />as staff to the Successor Agency. <br /> <br />2.2 Use of Loan Proceeds. Successor Agency may use the Loan Proceeds to pay <br />Enforceable Obligations (as such term is defined in the Dissolution Law). <br /> <br />ARTICLE 3 <br />SUCCESSOR AGENCY REPRESENTATIONS AND WARRANTIES <br /> <br />3.1 Standing. Successor Agency warrants that it is in good standing with respect to <br />all laws and regulations related to Successor Agency operations. <br /> <br />3.2 Authority. Successor Agency warrants that it has authority, and has completed <br />all proceedings and obtain all approvals necessary to execute, deliver, and perform <br />under this Agreement. <br /> <br />3.3 Valid and Binding Obligations. Successor Agency warrants that, when duly <br />executed by the Successor Agency, this Agreement shall constitute the legal, valid and <br />binding obligations of Successor Agency enforceable in accordance with its terms. <br />Successor Agency hereby waives any defense to the enforcement of the terms of this <br />Agreement related to alleged invalidity of any provisions or conditions contained in this <br />Agreement. <br /> <br />3.4 No Adverse Action. Successor Agency warrants that there is no action, suit or <br />proceeding pending or threatened against it which might adversely affect the Successor <br />Agency with respect to this Agreement. <br /> <br />ARTICLE 4 <br />SUCCESSOR AGENCY COVENANTS <br /> <br />4.1 Notification. Until the Loan is repaid in full, the Successor Agency covenants that <br />it will promptly notify City in writing of the occurrence of any event with might materially <br />and adversely affect its ability to perform its obligations under this Agreement, or which <br />constitutes, or with the giving of notice or passage of time or both would constitute, an <br />Event of Default under this Agreement. Such occurrences include, but are not limited <br />to, the threat or initiation of lawsuits or administrative proceedings against the <br />Successor Agency that results in a final judgment, order or decree that has a materially <br />adverse effect on the business of the Successor Agency and its ability to perform its <br />obligations under this Agreement, the revocations of material operating licenses, or <br />problems with vendors, suppliers, or customers that has a material effect on the <br />business of the Successor Agency and its ability to perform its obligations under this <br />Agreement.