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(h) From and after the date of this Agreement, the Seller shall not sell, transfer, <br />assign, set over or otherwise convey any right, title or interest of any kind whatsoever in all or <br />any portion of the Proposition lA Receivable, nor shall the Seller create, or to the knowledge of <br />the Seller permit the creation of, any Lien thereon. <br />7. The Purchaser's Acknowledgment. The Purchaser acknowledges that the <br />Proposition lA Receivable is not a debt or liability of the Seller, and that the Proposition lA <br />Receivable is payable solely by the State from the funds of the State provided therefor. <br />Consequently, neither the taxing power of the Seller, nor the full faith and credit thereof is <br />pledged to the payment of the Proposition lA Receivable. No representation is made by the <br />Seller concerning the obligation or ability of the State to make any payment of the Proposition <br />lA Receivable pursuant to Section 100.06 of the Revenue and Taxation Code and Section 25.5 <br />of Article XIII of the California Constitution, nor is any representation made with respect to the <br />ability of the State to enact any change in the law applicable to the Transaction Documents <br />(including without limitation Section 100.06 of the Revenue and Taxation Code or Section <br />6588.6 of the Government Code). The Purchaser acknowledges that the Seller has no obligation <br />with respect to any offering document or disclosure related to the Bonds. <br />8. Notices of Breach. <br />(a) Upon discovery by the Seller or the Purchaser that the Seller or Purchaser has <br />breached any of its covenants or that any of the representations or warranties of the Seller or the <br />Purchaser are materially false or misleading, in a manner that materially and adversely affects <br />the value of the Proposition lA Receivable or the Purchase Price thereof, the discovering party <br />shall give prompt written notice thereof to the other party and to the Trustee, as assignee of the <br />Purchaser, who shall, pursuant to the Indenture, promptly thereafter notify each Credit Enhancer <br />and the Rating Agencies. <br />(b) The Seller shall not be liable to the Purchaser, the Trustee, the holders of the <br />Bonds, or any Credit Enhancer for any loss, cost or expense resulting from the failure of the <br />Trustee, any Credit Enhancer or the Purchaser to promptly notify the Seller upon the discovery <br />by an authorized officer of the Trustee, any Credit Enhancer or the Purchaser of a breach of any <br />covenant or any materially false or misleading representation or warranty contained herein. <br />9. Liability of Seller; Indemnification. The Seller shall be liable in accordance <br />herewith only to the extent of the obligations specifically undertaken by the Seller under this <br />Agreement. The Seller shall indemnify, defend and hold harmless the Purchaser, the Trustee and <br />each Credit Enhancer, as assignees of the Purchaser, and their respective officers, directors, <br />employees and agents from and against any and all costs, expenses, losses, claims, damages and <br />liabilities to the extent that such cost, expense, loss, claim, damage or liability arose out of, or <br />was imposed upon any such Person by the Seller's breach of any of its covenants contained <br />herein or any materially false or misleading representation or warranty of the Seller contained <br />herein. Notwithstanding anything to the contrary herein, the Seller shall have no liability for the <br />payment of the principal of or interest on the Bonds issued by the Purchaser. <br />9 <br />55A-17 <br />