Special Services Covenant.

The Corporation shall operateand maintain the facilities as an educational institution within the territorial limits of the City of Riverside,California as long as any Bonds remain Outstanding; provided,however,the Authority, upon review of suchfacts as it deemsrelevant,mayofrom time to time, allow the Corporationto provide alternativeservicesthat provide public benefit to the City of Riverside, California and its residents, deemthis specialservicescovenantto be satisfiedin whole or in part. or Prohibited UsesCovenant. The Corporationcovenants and agreesthat no portion of the proceedsof the Bonds will be used (1) to finance or refinance any facility, place or building used or to be used for sectarian instructionor study or as a place for devotionalactivities or religious worship or in connectionwith any part of the programs of any school or departmentof divinity, or (2) by a Personthat is not a 501(c)(3) organizationor a governmentalunit or by a 501(c)(3) organization(including the Corporation)in an unrelatedtrade or business, in such manner or to such extent as would result in any of the Bonds being treated as an obligation not described in Section 103(a)of the Code. The Corporationagrees provide a report to the Authority regardingcompliancewith to this covenantupon any suchwritten demandby the Authorify, suchreport to be provided within ten BusinessDays of suchrequest. Events of Default. (a) Any one of the following which occurs and is continuing shall constitutean Event of Default pursuantto the Agreement: (i) failure by the Corporationto pay or causeto be paid any amountsrequiredto be paid underthe Agreementwhen due; or (ii) if any material representation or warranty made by the Corporation in the Agreement or made by the Corporation in any document,instrument or certificate furnished to the Trusteeor the Authority in connectionwith the issuance the Bonds shall at any time prove to of havebeenincorrectin any respectas of the time made; (iii) failure of the Corporation to observeand perform any covenant,condition or agteement on its part required to be observed or performed under the Agreement, other than making the paymentsreferred to in (aXi) above, which continues for a period of thirty (30) days after wriffen notice from the Trusteeor the Authority, which notice shall specifr such failure and requestthat it be remedied,unless the Authority and the Trustee shall agree in writing to an extensionof suchtime period; provided,however,that if the failure statedin the notice cannotbe correctedwithin such period, the Authority and the Trusteewill not unreasonably withhold their consentto an extensionof suchtime period if correctiveadtionis institutedwithin suchperiod and diligently pursueduntil the default is corrected; (iv) The Corporationshall have repudiatedits debtsor becomeinsolventor admit in writing its inability to pay its debtsas they matureor shall apply for, consentto or acquiesce the in appointmentof a trustee,custodian,liquidator or receiver for itself or any part of its property, or shall take any action to authorize or effect any of the foregoing; or in the absenceof any such application,consentor acquiescence, trustee,custodian,liquidator or receivershall be appointed a for it or for a substantial part of its property or revenues and shall not be dischargedwithin a period of 60 days;or all, or any substantial part, of the properly of the Corporationshall be seized, or otherwise appropriated, or any bankruptcy, reorganization, debt arrangement or other proceedingunder any bankruptcyor insolvency law or any dissolutionor liquidation proceeding shall be instituted by or againstthe Corporation (or any action shall be taken to authorize or effect the institution by it of any of the foregoing) and if instituted againstit, shall be consented or to acquiesced by it, or shall not be dismissed in within a period of 60 days;or
(v)

the occurrenceof an Event of Default under the Indenture.

D-32

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