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<br />other liens or in any other manner. <br /> <br />e. The BORROWER hereby pledges sufficient <ilnnual revenues from the BORROWER'S general funds <br />to pay the annual installment amount under this contract and the attached Promissory Note, <br />and hereby agrees to establish a separate account into which said revenues shall be deposited. <br /> <br />12. Pledge of revenues. For the purpose of repayment of this loan, the BORROWER hereby irrevocably <br />pledges from its general revenues received each year an amount sufficient to pay the annual <br />payment due under this contract and an additional sum each year for the first 10 years for its <br />reserve debt service fund. <br /> <br />a. Revenues for this loan are to be kept separate. The BORROWER shall set aside and keep the <br />pledged revenues in an account separate from other BORROWER revenues, and shall not use <br />the pledged revenues for any purpose other than repayment of this loan. <br /> <br />b. Establish security interest in the revenues. To provide a security interest to the STATE in the <br />pledged revenues so that the STATE shall have priority over all other competing claims for said <br />revenues, the BORROWER shall provide a properly executed Security Agreement, attached <br />hereto as Appendix 4 and incorporated herein. <br /> <br />c. Levy charges and fees for repayment of the loan. The BORROWER shall, pursuant to its <br />statutory authority and as authorized by its ordinances, take all necessary actions consistent <br />therewith to provide sufficient funds for adequate operation and maintenance, emergency repair <br />services, obsolescence reserves, debt reserves, and to set aside revenues in an amount <br />sufficient to pay this contract loan in a timely manner as required by the terms and conditions <br />herein to assure repayment of the loan to the STATE. I n the event these revenues are or <br />become insufficient to assure repayment to the STATE as required by the terms and conditions <br />herein, then the BORROWER shall immediately take all necessary action consistent with its <br />statutory authority to raise sufficient revenue to assure repayment of the loan to the STATE. <br />BORROWER shall deposit an amount equal to one-tenth of an annual payment into its reserve <br />debt service fund on an annual basis for the first ten years of this loan. <br /> <br />d. Additional Debts or Bonds. The BORROWER shall not issue any indebtedness payable from <br />the pledged revenues and having 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 STATE, provided <br />that: <br /> <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, being <br />current on the annual payments due under this contract and in the accumulation of all <br />amounts then required to be accumulated in the BORROWER'S debt service reserve fund; <br /> <br />ii. The BORROWER provides to the STATE a Parity Certificate from an independent certified <br />public accountant certifying that, based on an analysis of the BORROWER'S revenues, <br />excluding tap fees, for 12 consecutive months out of the 18 months immediately preceding <br />the date of issuance of such parity debt, the BORROWER'S revenues are sufficient to pay at <br />lea~t the annual debt service on all outstanding indebtedness having a lien on the pledged <br />revenues, including this loan, the annual debt service on the proposed indebtedness to be <br />issued, and all required deposits to any reserve funds required by this contract or by the <br /> <br />Town of Morrison <br /> <br />Page 6 of 13 <br />