88-033 ORD CERTIFICATE FOR ORDINANCE

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of such audit for the preceding year shall be mailed to the Municipal Advisory Council of Texas, to each paying agent for any bonds payable from Pledged Revenues, and to any Bondholders who shall so request in writing. The annual audit reports shall be open to the inspection of the Bond- holders and their agents and representatives at all reason- able times. (1) Governmental Aaencies. It will comply with all of the terms and conditions of any and all franchises, permits, and authorizations applicable to or necessary with respect to the System, and which have been obtained from any govern- mental agency; and the Issuer has or will obtain and keep in full force and effect all franchises, permits, authoriza- tion, and other requirements applicable to or necessary with respect to the acquisition, construction, equipment, opera- tion, and maintenance of the System. (m) No Comnetition. It will not operate, or grant any franchise or permit for the acquisition, construction, or operation of, any facilities which would be in competition with the System, and to the extent that it legally may, the Issuer will prohibit any such competing facilities. (n) No Arbitraae. That the Issuer covenants to and with the purchasers of the Bonds and any Additional Parity Revenue Bonds that no use will be made of the proceeds of any of such bonds at any time throughout the term of any of such bonds which, if such use had been reasonably expected on the date of delivery of any of such bonds to and payment therefor by the purchasers, would have caused any of such bonds to be arbitrage bonds within the meaning of Section 103(c) of the Internal Revenue Code of 1954, as amended, or any regulations or rulings pertaining thereto; and by this covenant the Issuer is obligated to comply with the require- ments of the aforesaid Section 103(c) and all applicable and pertinent Department of the Treasury regulations relating to arbitrage bonds. The Issuer further covenants that the proceeds of all such bonds will not otherwise be used directly or indirectly so as to cause all or any part of such bonds to be or become arbitrage bonds within the meaning of the aforesaid Section 103(c), or any regulations pertaininq thereto. Section 26. AMENDMENT OF ORDINANCE. (a) The holders of Bonds and Additional Parity Revenue Bonds aggregating in principal amount of 51$ of the aggregate principal amount of then outstanding Bonds and Additional Parity Revenue Bonds shall have the right from time to time to approve any amendment to this Ordinance which may be deemed necessary or desirable by the Issuer, provided, however, that nothing herein contained shall permit or be construed to permit the 39