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<br />persons whomsoever; it is lawfully qualified to pledge the Net Revenues to the payment of the Parity Bonds in
<br />the manner prescribed herein; and it has lawfully exercised such rights,
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<br />(d) ~, It will from time to time and before the same become delinquent pay and discharge all taxes,
<br />assessments and governmental charges, if any, which shall be lawfully imposed upon it or the System; it will pay
<br />all lawful claims for rents, royalties, labor, materials, and supplies which if unpaid might by law become a lien
<br />or charge thereon, the lien of which would be prior to or interfere with the liens hereof, so that the priority of
<br />the liens granted hereunder shall be fully preserved in the manner provided herein: and it will not create or suffer
<br />to be created any mechanic's, laborer's, materialman's or other lien or charge which might or could be prior to
<br />the liens hereof, or do or suffer any matter or thing whereby the liens hereof might or could be impaired;
<br />provided, however, that no such tax, assessment, or charge, and that no such claims which might be used as the
<br />basis of a mechanic's, laborer's, materialman's, or other lien or charge, shall be required to be paid so long as
<br />the validity of the same shall be contested in good faith by the City,
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<br />(e) Operation of System: No Free Service, It shall continuously and efficiently operate the System and
<br />maintain the System in good condition, repair, and working order, all at reasonable cost. No free service of the
<br />System shall be allowed, and should the City or any of its agencies or instrumentalities, lessees, or concession-
<br />aires make use of the services and facilities of the System, payment monthly of the standard retail price of the
<br />services provided shall be made by the City or any of its agencies or instrumentalities, lessees, or concessionaires
<br />out of funds fTom sources other than the revenues of the System, unless made from surplus Net Revenues.
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<br />(f) Further Encumbrance, Other than for the payment of the Parity Bonds, the rents, revenues, and income
<br />of the System have not in any manner been pledged to the payment of any debt or obligations of the City or of
<br />the System: and it shall not additionally sell or encumber the Net Revenues in any manner, except as pennitted
<br />in the Parity Bonds Ordinances in connection with Additional Bonds, unless said encumbrance is made junior
<br />and subordinate in all respects to the liens, pledges, covenants, and agreements of the Parity Bonds Ordinances;
<br />but the right of the City to issue revenue bonds payable from a subordinate lien on the surplus Net Revenues is
<br />specifically recognized and retained.
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<br />(g) Sale or Disposal of Property, It shall not sell, convey, mortgage, encumber, lease, or in any manner
<br />transfer title to, or dedicate to other use, or otherwise dispose of the System, or any significant or substantial part
<br />thereof; provided, however, that whenever the City deems it necessary to dispose of any other property,
<br />machinery, fixtures, or equipment, or dedicate such property to other use, it may do so either when it has made
<br />arrangements to replace the same or provide substitutes therefor, or it is detennined by resolution of the City
<br />Council that no such replacement or substitute is necessary.
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<br />(h) Insurance. It agrees to maintain insurance on the System, for the benefit of the registered owner or
<br />owners of the Parity Bonds of a kind and in an amount which usually would be carried by private companies
<br />engaged in a similar type of business in the same area,
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<br />(i) Records and Audits, It shall keep proper books and records and accounts, separate from all other
<br />records and accounts, in which complete and correct entries shall be made of all transactions relating to the
<br />System. Upon written request made not more than 60 days following the close of the fiscal year, the City shall
<br />furnish to any holder of any Parity Bonds, complete financial statements of the System in reasonable detail
<br />covering such fiscal year, certified by the City's Auditor, Any holders of 25% in principal amount of the Parity
<br />Bonds at the time outstanding shall have the right at all reasonable times to inspect the System and all records,
<br />accounts, and data of the City relating thereto.
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<br />(j) Governmental AlIencies. It has or will obtain and keep in full force and effect all franchises, pennits,
<br />authorization, and other requirements applicable to or necessary with respect to the acquisition, construction,
<br />equipment. operation, and maintenance of the System, and it will comply with all of the tenns and conditions of
<br />any and all franchises, pennits and authori7..ations applicable to or necessary with respect to the System.
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