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35-` 0063,59 ARTICLE II REPRESENTATIONS, COVENANTS AND WARRANTIES Section 2.1. Representations, Covenants and Warranties of Issuer. Issuer represents, covenants and warrants as follows: (a) Issuer is a body politic and corporate, duly organized and existing as a city under the Constitution and laws of the State. Under the provisions of the Act and the Constitution of the State, Issuer is authorized to enter into the transactions contemplated by this Agreement and the Indenture, to issue the Bonds and to carry out its obligations hereunder and under the Indenture. Issuer has been duly authorized by appropriate proceedings of its County Board of Supervisors, to execute and deliver this Agreement and the Indenture and to issue the Bonds. (b) Company has estimated that the Eligible Costs of the Project exceed $1,000,000, and on that basis, Issuer agrees to issue the Series 1985 Bonds in the aggregate principal amount of $1,000,000. (c) The Series 1.985 Bonds will be issued under the Indenture and will mature at such dates and bear interest at such rates and will be subject to redemption at the time and at the redemption prices as set forth in the Indenture, and Issuer may issue such Additional Bonds as may be required and authorized pursuant to Section 2.10 of the Indenture. (d) Issuer covenants that it will not assign or pledge, other than on a completely subordinated basis, the Lease Payments hereunder or any other amounts de- rived from the Project or pledged pursuant to this Agreement or the Indenture other than to secure the Bonds. (e) Issuer hereby finds that a private sale of the Bonds to the Original Purchaser would be advantageous to Issuer. (f) Issuer hereby determines that the Project is of the type permitted by the Act and Issuer is issuing the Series 1985 Bonds to accomplish the financing of the Project so as to achieve the public purposes of the Act. -9- L �J