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becoming arbitrage bonds under Section 148 of the Internal <br />Revenue Code of 1986 and regulations thereunder. <br />6,01. The Bonds and any additional obligations, tj <br />the extent authorized by this Section 6, shall be equally and <br />ratably secured by a first lien on and pledge of the net <br />revenues of the Water and Sewer System, without regard to Bond <br />series, serial numbers, order of execution or otherwise. <br />6,02. The City shall have the right to issue <br />additional obligations to be secured by a parity lien on and <br />ratably payable from the net revenues of the Water and Sewer <br />System for the purpose of providing money for improvements or <br />extensions to the Water and Sewer System of the City. <br />6,03. Without regard to the limitations provided by <br />paragraph 6.02 the City may issue bonds payable from the net <br />revenues of the Water and Sewer System: <br />(a) for the purpose of refunding the principal of all <br />Bonds outstanding; or <br />(b) for the purpose of refunding the principal of and <br />interest on outstanding Bonds not paid when due <br />for lack of available net revenues. <br />SECTION 7. FURTHER COVENANTS. So long as any of the <br />Bonds are outstanding, the City covenants with and for the <br />benefit of each Bond holder that: <br />7.01. The City will establish, maintain and collect <br />such charges of the nature authorized by Section 444.075, <br />Minnesota Statutes, at the times and in the amounts necessary <br />so that the net revenues of the Water and Sewer System will be <br />sufficient to make the required payments into the Water and <br />Sewer Bond Account. <br />7.02. The City will continue to own, operate and <br />maintain the Water and Sewer System of the City as a <br />revenue -producing utility free from all liens on the property <br />thereof and income therefrom other than the liens herein <br />described or provided. <br />7 0 . The City will use its best efforts to comply <br />with all applicable laws and regulations of the United States <br />of America and the State of Minnesota and each department and <br />agency thereof, including laws and regulations relating to <br />public health and water and sewer quality. The City will <br />continue to use and operate the System to the extent such use <br />and operation is not prohibited by court order or regulation, <br />-19- <br />