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D. Additional Debts or Bonds. The Borrower shall not issue any indebtedness payable from <br /> the Pledged Revenues or have a lien thereon which is superior to the lien of this loan. The <br /> Borrower may issue parity debt only with the prior written approval of the CWCB,provided <br /> that: <br /> i. The Borrower is currently and at the time of the issuance of the parity debt in substantial <br /> compliance with all of the obligations of this Contract, including, but not limited to, <br /> being current on the annual payments due under this Contract. <br /> ii. The Borrower provides to the CWCB a Parity Certificate from an independent certified <br /> public accountant certifying that, based on an analysis of the Borrower's revenues, for <br /> twelve(12)consecutive months out of the eighteen(18)months immediately preceding <br /> the date of issuance of such parity debt, the Borrower's revenues are sufficient to pay <br /> its annual operating and maintenance expenses, annual debt service on all outstanding <br /> indebtedness having a lien on the Pledged Revenues,including this loan,and the annual <br /> debt service on the proposed indebtedness to be issued. The analysis of revenues shall <br /> be based on the Borrower's current rate structure or the rate structure most recently <br /> adopted. No more than ten percent (10%) of total revenues may originate from tap <br /> and/or connection fees; <br /> iii. The Borrower acknowledges and understands that any request for approval of the <br /> issuance of additional debt must be reviewed and approved by the CWCB prior to the <br /> issuance of any additional debt. <br /> E. 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 /> F. Pledged Revenues During Loan Repayment. The Borrower shall not sell, convey, assign, <br /> grant, transfer, mortgage, pledge, encumber, or otherwise dispose of the Pledged Revenues, <br /> so long as any of the principal, accrued interest, and late charges, if any, on this loan remain <br /> unpaid, without the prior written concurrence of the CWCB. <br /> 12. RELEASE AFTER LOAN IS REPAID <br /> Upon complete repayment to the CWCB of the entire principal, all accrued interest, and late <br /> charges, if any, as specified in the Promissory Note, the CWCB agrees to release and terminate <br /> any and all of the CWCB's right, title, and interest in and to the Pledged Revenues. <br /> 13. WARRANTIES <br /> A. The Borrower warrants that, by acceptance of the loan under this Contract and by its <br /> representations herein,the Borrower shall be estopped from asserting for any reason that it is <br /> not authorized or obligated to repay the loan to the CWCB as required by this Contract. <br /> B. The Borrower warrants that it has not employed or retained any company or person, other <br /> than a bona fide employee working solely for the Borrower, to solicit or secure this Contract <br /> and has not paid or agreed to pay any person,company,corporation,individual,or firm,other <br /> than a bona fide employee, any fee, commission, percentage, gift, or other consideration <br /> contingent upon or resulting from the award or the making of this Contract. <br /> C. The Borrower warrants that the Pledged Revenues for this loan are not encumbered by any <br /> other deeds of trust or liens of any party other than the CWCB or in any other manner,except <br /> for the Existing Parity Indebtedness which sets forth the position of the lien created by this <br /> Contract Number:CT2019-3687 Page 9 of 19 Version 0119 <br />