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<br /> <br /> <br />16 <br />Parity Debt as described above, or obligations which are either unsecured or which are secured <br />on a basis which is junior and subordinate to the pledge of and lien upon the Net Revenues <br />established under the Installment Sale Agreement. <br /> <br />Casualty Insurance and Eminent Domain Proceeds <br /> <br />Covenant to Maintain Insurance. The City covenants that it will at all times maintain <br />such insurance (which may be in the form of self-insurance pooling) on the Water System as is <br />customarily maintained with respect to works and properties of like character against accident <br />to, loss of or damage to such works or properties. <br /> <br />Insurance Proceeds. All amounts collected from insurance against accident to or <br />destruction of any portion of the Water System shall be used to repair or rebuild such damaged <br />or destroyed portion of the Water System, and to the extent not so applied, shall be applied to <br />redeem Bonds or any Parity Debt in accordance with the Indenture and applicable Parity Debt <br />Instruments. <br /> <br />Eminent Domain Proceeds. If all or any part of the Water System is taken by eminent <br />domain proceedings, the Net Proceeds realized by the City therefrom will be deposited by the <br />City in a special fund in trust and applied by the City to the cost of acquiring or constructing or <br />financing improvements to the Water System, or to redeem Bonds or any Parity Debt in <br />accordance with the Indenture and applicable Parity Debt Instruments. <br />Page 144 of 205