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15. Tax-Exempt Status of the Bonds; Rebate. The City shall comply with <br />requirements necessary under the Code to establish and maintain the exclusion from <br />gross income under Section 103 of the Code of the interest on the Certificate, including <br />without limitation (1) requirements relating to temporary periods for investments, (2) <br />limitations on amounts invested at a yield greater than the yield on the Certificate, and <br />(3) the rebate of excess investment earnings to the United States if the Certificate <br />(together with other obligations reasonably expected to be issued and outstanding at one <br />time in this calendar year) exceed the small-issuer exception amount of $5,000,000, or do <br />not otherwise qualify for available exceptions. For purposes of qualifying for the small- <br />issuer exception to the federal arbitrage rebate requirements, the City hereby finds, <br />determines and declares that (1) the Certificate is issued by a governmental unit with <br />general taxing powers, (2) the Certificate is not a private activity bond, (3) ninety-five <br />percent (95%) or more of the net proceeds of the Certificate are to be used for local <br />governmental activities of the City (or of a governmental unit the jurisdiction of which is <br />entirely within the jurisdiction of the City), and (4) the aggregate face amount of all <br />tax-exempt bonds (other than private activity bonds) issued by the City (and all entities <br />subordinate to, or treated as one issuer with, the City) during the 1998 calendar year is <br />not reasonably expected to exceed $5,000,000, all within the meaning of Section <br />148(f)(4)(D) of the Code. <br /> <br /> 16. The City hereby designates the Certificate as a "qualified tax-exempt <br />obligation" within the meaning of Section 265(b)(3) of the Code and represents that: <br /> <br /> (a) the reasonably anticipated amount of tax-exempt obligations (other than <br />private activity bonds, treating qualified 501(c)(3) bonds as not being private activity <br />bonds) which will be issued by the City (and all entities subordinate to, or treated as one <br />issuer with, the City) during calendar year 1998 will not exceed $10,000,000; and <br /> <br /> (b) not more than $10,000,000 of obligations issued or to be issued by the City <br />during calendar year 1998 have been designated for purposes of Section 265(b)(3) of the <br />Code. <br /> <br />The City shall use its best efforts to comply with any federal procedural requirements <br />which may apply in order to effectuate the designation made by this paragraph. <br /> <br /> 17. When any obligation of the Certificate has been discharged as provided in this <br />paragraph, all pledges, covenants and other rights granted by this Resolution to the <br />registered owner of the Certificate (with respect to the obligation thereof so defeased) <br />shall, to the extent permitted by law, cease. The City may at any time discharge any or <br />all of such obligation(s) with respect to the Certificate, subject to the provisions of law <br />now or hereafter authorizing or regulating such action, by depositing irrevocably in <br />escrow, with a suitable institution qualified by law as an escrow agent for this purpose, <br /> <br />372500.1 9 <br /> <br /> <br />