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charges), insurance proceeds or other moneys derived by the City from the water services, facilities, and
<br />commodities or byproducts sold, furnished or supplied through the facilities of or in the conduct or operation of
<br />the business of the Water System, (ii) investment earnings on, and income derived from, the amounts referred to
<br />in the preceding clause (i), including investment earnings on the operating reserves, to the extent that the use of
<br />such earnings is limited to the Water System by or pursuant to law, and earnings on any Reserve Fund for
<br />Obligations but only to the extent that such earnings may be utilized under the Issuing Instrument for the
<br />payment of debt service for such Obligations; (iii) the proceeds derived by the City directly or indirectly from
<br />the sale or lease of a part of the Water System; and (iv) any amount received from the levy or collection of taxes
<br />which are solely available and are earmarked for the support of the operation of the Water System; provided,
<br />however, that System Revenues shall not include: (a) customers' deposits or any other deposits or advances
<br />subject to refund until such deposits or advances have become the property of the City; and (b) the proceeds of
<br />borrowings. Notwithstanding the foregoing, there shall be deducted from System Revenues any amounts
<br />transferred into a Rate Stabilization Fund as contemplated by Section 6.08(b), and there shall be added to
<br />System Revenues any amounts transferred out of such Rate Stabilization Fund to pay Maintenance and
<br />Operation Costs. System Revenues shall include reimbursements from the United States of America pursuant to
<br />Section 54AA of the Code (Section 1531 of Title I of Division B of the American Recovery and Reinvestment
<br />Act of 2009 (Pub. L. No. 111 -5, 23 Stat. 115 (2009), enacted February 17, 2009)), or any future similar
<br />program); provided, however, for purposes of complying with the rate setting covenants contained in the
<br />Installment Purchase Agreement and satisfying the debt service coverage requirements in connection with the
<br />issuance or incurring of Parity Obligations, System Revenues shall not include such reimbursements from the
<br />United States of America. See Appendix B "SUMMARY OF CERTAIN DEFINED TERMS AND
<br />PRINCIPAL LEGAL DOCUMENTS."
<br />"Maintenance and Operations Costs" is the reasonable and necessary costs spent or incurred by the City,
<br />for maintaining and operating the Water System, calculated in accordance with generally accepted accounting
<br />principles, including (among other things) all costs of water purchased or leased by the City, the reasonable
<br />expenses of management and repair and other expenses necessary to maintain and preserve the Water System in
<br />good repair and working order, and including administrative costs of the City attributable to the Project and the
<br />Installment Purchase Agreement, salaries and wages of employees, payments to employees retirement systems
<br />(to the extent paid from System Revenues), overhead, taxes (if any), fees of auditors, accountants, attorneys or
<br />engineers and insurance premiums, and including all other reasonable and necessary costs of the City or charges
<br />required to be paid by it to comply with the terms of the Obligations, including this Installment Purchase
<br />Agreement, including any amounts required to be deposited in the Rebate Fund pursuant to the Tax Certificate,
<br />and fees and expenses payable to any Credit Provider (other than in repayment of a Credit Provider
<br />Reimbursement Obligation), but excluding in all cases (i) depreciation, replacement and obsolescence charges
<br />or reserves therefor, (ii) amortization of intangibles or other bookkeeping entries of a similar nature, (iii) costs of
<br />capital additions, replacements, betterments, extensions or improvements to the Water System which under
<br />generally accepted accounting principles are chargeable to a capital account or to a reserve for depreciation, (iv)
<br />charges for the payment of principal and interest on any general obligation bond heretofore or hereafter issued
<br />for Water System purposes, and (v) charges for the payment of principal and interest on any debt service on
<br />account of any obligation on a parity with or subordinate to the Installment Payments. Payments with respect to
<br />Maintenance and Operation Obligations shall be considered Maintenance and Operation Costs if they are
<br />incurred in connection with the Maintenance and Operation Costs described in the preceding paragraph. See
<br />Appendix B — "SUMMARY OF CERTAIN DEFINED TERMS AND PRINCIPAL LEGAL DOCUMENTS."
<br />"Maintenance and Operation Obligation" means any contract or lease for the purchase of any facilities,
<br />properties, structures, or works, or any loan of credit to or guaranty of debts, claims or liabilities of any other
<br />person for the purpose of obtaining any facilities, properties, structures or works, the final payments under
<br />which are due more than five years following the effective date thereof, so long as in each case the payments
<br />thereunder are to constitute Maintenance and Operation Costs.
<br />Obligations of City Under Installment Purchase Agreement
<br />Pursuant to the Installment Purchase entity commits, absolutely and unconditionally, to
<br />make Installment Payments to the Authority s��Y tem Revenues until such time as to the purchase
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