The Issuer covenants and agrees with the holders of the Bond that so long as any of the Bond remain outstanding and unpaid as to either principal or interest:
(a) The Issuer will maintain the System in good repair and working order and will operate the same efficiently and will faithfully and punctually perform all duties with reference to the System required by the Constitution and laws of the State of Michigan, the Issuer’s Charter and this Ordinance.
(b) The Issuer will keep proper books of record and account separate from all other records and accounts of the Issuer, in which shall be made full and correct entries of all transactions relating to the System. The Issuer shall have an annual audit of the books of record and account of the System for the preceding operating year made each year by an independent certified public accountant. The auditor shall comment on the manner in which the Issuer is complying with the requirements of the Ordinance with respect to setting aside and investing moneys and meeting the requirements for acquiring and maintaining insurance. The audit shall be completed and so made available not later than six (6) months after the close of each operating year except as such period may be extended in conformance with the rules of the Michigan Department of Treasury.
(c) The Issuer will maintain and carry, for the benefit of the holders of the Bond, insurance on all physical properties of the System and liability insurance, of the kinds and in the amounts normally earned by municipalities engaged in the operation of Water and Sewer System, including self-insurance. All moneys received for losses under any such insurance policies shall be applied solely to the replacement and restoration of the property damaged or destroyed, and to the extent not so used, shall be used for the purpose of redeeming or purchasing Bond.
(d) The Issuer will not sell, lease or dispose of the System, or any substantial part, until all of the Bond have been paid in full, both as to principal and interest or provision made thereof as herein provided. The Issuer will operate the System as economically as possible, will make all repairs and replacements necessary to keep the System in good repair and working order, and will not do or suffer to be done any act which would affect the System in such a way as to have a material adverse effect on the security for the Bond.
(e) The Issuer will not grant any franchise or other rights to any person, firm or corporation to operate a System that will compete with the System and the Issuer will not operate a system that will compete with the System.
(f) The Issuer will cause the Project to be acquired and constructed promptly and in accordance with the plans and specification therefor.
(Ord. 2016-1. Passed 12-21-15.)