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not limited to, being current on the annual payments due under this CONTRACT and
<br /> in the accumulation of all amounts then required to be accumulated in the
<br /> BORROWER'S debt service reserve fund;
<br /> ii. The BORROWER provides to the CWCB a Parity Certificate from an independent
<br /> certified public accountant certifying that, based on an analysis of the BORROWER'S
<br /> revenues, for 12 consecutive months out of the i8 months immediately preceding the
<br /> date of issuance of such parity debt, the BORROWER'S revenues are sufficient to pay its
<br /> annual operating and maintenance expenses, annual debt service on all outstanding
<br /> indebtedness having a lien on the pledged revenues, including this loan, the annual
<br /> debt service on the proposed indebtedness to be issued, and all required deposits to
<br /> any reserve funds required by this CONTRACT or by the lender(s) of any indebtedness
<br /> having a lien on the pledged revenues. The analysis of revenues shall be based on the
<br /> BORROWER'S current rate structure or the rate structure most recently adopted. No
<br /> more than io% of total revenues may originate from tap and/or connection fees;
<br /> iii. The BORROWER acknowledges and understands that any request for approval of
<br /> the issuance of additional debt must be reviewed and approved by the CWCB prior to
<br /> the issuance of any additional debt.
<br /> f. Annual Statement of Debt Coverage. Each year during the term of this CONTRACT, the
<br /> BORROWER shall promptly submit, to CWCB, a copy of the annual audit report of an audit
<br /> performed on Borrower's records that relates to this CONTRACT or the PROJECT.
<br /> g. Pledged Revenues During Loan Repayment. The BORROWER shall not sell, convey,
<br /> assign, grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the PLEDGED
<br /> REVENUES, so long as any of the principal, accrued interest, and late charges, if any, on this
<br /> loan remain unpaid,without the prior written concurrence of the CWCB.
<br /> 10. Pledge of Property. The BORROWER irrevocably pledges to the CWCB, for purposes of
<br /> repayment of this loan, an interest in the PLEDGED PROPERTY. The PLEDGED PROPERTY as further
<br /> described in Section 6 (LOAN SECURITY) of Appendix 1 is authorized by the BORROWER'S
<br /> AUTHORIZING RESOLUTION, and secured by the DEED OF TRUST(attached as Appendix 6).
<br /> a. Pledged Property during Loan Repayment. The BORROWER shall not sell, convey,
<br /> assign, grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the PLEDGED
<br /> PROPERTY so long as any of the principal, accrued interest, and late charges, if any, on
<br /> this loan remain unpaid, without the prior written concurrence of the CWCB. In the
<br /> event of any such sale, transfer or encumbrance without the CWCB's written
<br /> concurrence, the CWCB may at any time thereafter declare all outstanding principal,
<br /> interest, and late charges, if any, on this loan immediately due and payable.
<br /> II. Release After Loan Is Repaid. Upon complete repayment to the CWCB of the entire
<br /> principal, all accrued interest, and late charges, if any, as specified in the PROMISSORY NOTE,
<br /> the CWCB agrees to release and terminate any and all of the CWCB's right, title, and interest
<br /> in and to the PLEDGED REVENUES and the PLEDGED PROPERTY.
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