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Section 6. Tax Covenants. 6.O1.. The City covenants and agrees with the holders from time to time of the Bonds that.it will nottake.or permit to be tnkcn by ally of its officers, employees or agents any action which would cause the interest on the Bonds to becotne.subiect to taxation under the internal Revenue Code of 1986, as amended (the "Code"), and the Treasury Regulations promulgated thereunder (tlie ".Re,,ulatiotis."), in effect.at tile.time.of:such actions, and :that it will take or cause its officers, emp..loyees or agents to take,. all.affirmative, action within, its power that maybe necessary to ensure, that such interest will. not become subiect to taxat:iQnunder the Code and the Regulations,.as presently extstip&or as hereafiemmendc.dand madeapplicable. to the Bonds. 6;02. (a) 1'1te.Citywill comp lywithrequiretnetttsnecessaryundertheCodetoestablishandmaintaintheexclusionfromgross income of.the interest on the Bonds under Section 103 of the Code,. including witliotit limitation requirements relating tQ teniporary periods for investments, limitations on amounts invested at a yield greater than.the yield on the Bonds, and lhe. rebate of excess investment. earnings to the United States if the Bonds.:(tpgpther with other obligations reasonably expected to be issued in calendar year20K.)-exceed the small -issuer exception amo. alitof$5;0OO,0OO: (b) For purposes of'qualifyingfor the small issuer exception to the federal arbitrate rebate -requirements the City finds, determines and declares that the:agDregateface amount df all tax-exempt bonds (other than private activi ty bonds)issued by the City (and all. sttborditlate .entities .of the City) during thecalendar year 2004 is not reasonably expected to exceed. $5001000, all within the ineaning of Section 148(fl (4)(C) of the Code. 6.03.. The City furthercovenaiits notto use the.proceeds'oftlte Bonds tir to cause or permit them or ariy of them to be used;. in such .a manner as to cause the Bonds to be."private activity bonds" within the weatiing of Sections,-] 03 and 14:1 through 150 of tile Code. 6.04: In.orderto qualify file Bonds as "qualified tax-exentptobligations"within the meaningof Section W(b)(3) of the Code, the -City makes the f6116- +ing factual statements and representations: (a) the Bonds -are not "private activity bonds" as defined in Section 141 oPthe:Code; (b) the City designates the Bonds as "qualified tax-exempt: obligations" for purpo§es*of Section ?65(b)(3): of the Code; (c) -the reasonablyanticipattedampuntoftax-exemptobligations(otherthanprivateacti'vitybonds.thatarenotqualifed. 5i3I(c)(.3) bonds) which will. be issued by the City -(and all subordinate entities of the City) during calendar year 2004 will not exceed $10,O0O,QO0.; and (d) not more than $1O;O0O,Q0O:of obligations issued by the City during calendar year 2004 have beendesignated for purposes. of Section 265(b)(3) of the Code. 0.f15. "The City: wiII use its .bestef drts to comply with oily federalprocedurai requirements which may apply in order to. elTectuate .the designations made.biy1his section. Section 7: No -Continuing Disclosure. 7.01. "file Bonds are not subject to the requirementsofSEC Rule t5c2-12because the original aggregate principal amount of the Bonds is less than $1,000;000. (file remainder of this page.• is intentionally left blank.)