02-18 Authorizing The Issuance of General Obligation Bonds

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into the Project Fund shall be expended only for the purpose of paying expenses incurred in connection with the Projects, together with the expenses incidental thereto and on account of the issuance of the Bonds. Any balance remaining in the Project Fund after the completion of the Projects that is not required to meet unpaid obligations incurred in connection therewith and on account of the issuance of the Bonds may be used to pay debt service on the Bonds or otherwise used as permitted by law. (b) Bond Fund. There is hereby created a separate fund, designated as the "City of South Bend, Indiana 2018 Bond Fund" (the "Bond Fund"), which shall be applied to the payment of the principal of and interest on the Bonds. As taxes attributable to the debt service levy for the Bonds are collected, subject to Section VIII hereof, they shall be accumulated in an account of the Bond Fund hereby created and designated as the "City of South Bend, Indiana 2018 Bond Tax Account" (the "Tax Account"). The Bond Fund shall also have a separate account designated the Revenues Account as described in Section VIII hereof. (c) Reserve Fund. At the time of the sale of the Bonds, the Controller, with the advice of the City's municipal advisor, may determine to establish a debt service reserve fund for the Bonds (the "Reserve Fund"), which shall be funded with a portion of the proceeds of the Bonds in an amount determined by the municipal advisor to be required to adequately secure the Bonds (the "Debt Service Reserve Requirement"). All money in the Reserve Fund shall be used and withdrawn by the City solely for the purpose of making deposits into the Bond Fund, in the event of any deficiency at any time in such fund, or for the purpose of paying the interest on or principal of or redemption premiums, if any, on the Bonds in the event that no other money is lawfully available therefor. Any amount in the Reserve Fund in excess of the Debt Service Reserve Requirement shall be withdrawn from the Reserve Fund and deposited in the Bond Fund. Money in the Reserve Fund shall also be available to make the final payments of interest and principal on the Bonds. Notwithstanding the foregoing, the Controller, with the advice of the City's municipal advisor, may enable the City to satisfy all or any part of its obligation to maintain an amount in the Reserve Fund equal to the Debt Service Reserve Requirement by depositing a Reserve Fund Credit Facility in the Reserve Fund, provided that such deposit does not adversely affect any then existing rating on the Bonds. A Reserve Fund Credit Facility is hereby defined as a letter of credit, liquidity facility, insurance policy or comparable instrument furnished by a bank, insurance company, municipal institution or other entity pursuant to a reimbursement agreement or similar instrument between such entity and the City for the purpose of satisfying in whole or in part the City's obligation to maintain the Reserve Requirement. In the event the amount on deposit in the Reserve Fund is ever less than the Debt Service Reserve Requirement,the City shall deposit from available revenues an amount sufficient to increase the amount on deposit to equal the Debt Service Reserve Requirement. SECTION VIII. Reduction of Tax Lew and Pledge of Certain Other Revenues. The amount of the tax levy each year applicable to making payments on the Bonds as set forth in the budget of the City (the "Tax Levy") shall be reduced by available revenues of the City to the extent such revenues have been set aside and designated by the City for such purpose in the account of the City's Debt Service Fund hereby created and designated as the "City of South 11