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investment earnings to the United States unless the Bonds qualify for an exception to the rebate requirement under the Code and related Treasury Regulations. 7.03. Not Private Activity Bonds. The City further covenants not to use the proceeds of the Bonds or to cause or permit the facilities financed by the Refunded Bonds or any of them to be used, in such a manner as to cause the Bonds to be "private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code. 7.04. Qualified Tax -Exempt Obligations. In order to qualify the Bonds as "qualified tax- exempt obligations" within the meaning of Section 265(b)(3) of the Code, the City makes the following factual statements and representations: (a) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; (b) the Refunded Bonds were previously designated as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Code, the average maturity of the Bonds is not longer than the average maturity of the Series 2012A Refunded Bonds or the Series 2010A Refunded Bonds, and the Bonds mature not later than 30 years after the date of the Series 2012A Refunded Bonds or the Series 2010A Refunded Bonds were issued and therefore the portion of the Bonds which does not exceed the outstanding principal amount of the Refunded Bonds is deemed designated as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Code; (c) the City hereby designates the portion of the Bonds exceeding the $1,350,000 outstanding principal balance of the Series 2010A Refunded Bonds plus the $4,515,000 outstanding principal balance of the Series 2012A Refunded Bonds, collectively, as "qualified tax- exempt obligations" for purposes of Section 265(b)(3) of the Code; (d) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds, that are not qualified 501(c)(3) bonds) which will be issued by the City (and all subordinate entities of the City) during calendar year 2020 will not exceed $10,000,000; and (e) not more than $10,000,000 of obligations issued by the City during calendar year 2020 have been designated for purposes of Section 265(b)(3) of the Code; and (f) the aggregate face amount of the issue of the Bonds is not greater than $10,000,000. 7.05 Procedural Requirements. The City will use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designations made by this section. EL185-66-684471.v2 10