10134-11 Waterworks Revenue Bonds $8,300,000

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Revenue Code of 1986, as amended (the "Code"), and the regulations thereunder as applicable to the 2012 Bonds, including, without limitation, the taking of such action as is necessary to rebate or cause to be rebated arbitrage profits on 2012 Bond proceeds or other monies treated as 2012 Bond proceeds to the federal government as provided in Section 148 of the Code, and will set aside such monies, which may be paid from investment income on funds and accounts notwithstanding anything else to the contrary herein, in trust for such purposes. (d) The City will file an information report on Form 8038-G with the Internal Revenue Service as required by Section 149 of the Code. (e) The City will not make any investment or do any other act or thing during the period that any 2012 Bond is outstanding hereunder which would cause any 2012 Bond to be an "arbitrage bond" within the meaning of Section 148 of the Code and the regulations thereunder as applicable to the 2012 Bonds. Notwithstanding any other provisions of this Ordinance, the foregoing covenants and authorizations (the "Tax Sections") which are designed to preserve the exclusion of interest on the 2012 Bonds from gross income under federal law (the "Tax Exemption") need not be complied with to the extent the City receives an opinion of nationally recognized bond counsel that compliance with such Tax Section is unnecessary to preserve the Tax Exemption. SECTION 25. Issuance of BANs; Other Actions. (a) The City, having satisfied all the statutory requirements for the issuance of the 2012 Bonds, has the authority to elect to issue a bond anticipation note or notes, repayable from the proceeds received from the sale of the 2012 Bonds (defined herein as the "BANs"). This Council hereby authorizes the issuance and sale of the BANs pursuant to I.C. §5-1-14-5 in one or more series, ranking on a parity with each other, in original aggregate principal amount not to exceed Eight Million Three Hundred Thousand Dollars ($8,300,000) to provide interim financing until permanent financing becomes available and to pay for costs of issuing the BANs, and the BANs also may fund capitalized interest thereon. The designation of the BANs shall be "City of South Bend, Indiana Waterworks Bond Anticipation Note of 20 ". The BANs shall be issued in fully registered form in denominations of Five Thousand Dollars ($5,000), or integral multiples thereof, shall be originally dated the date of delivery, shall be numbered consecutively from 1 upward, shall mature not more than five (5) years from the date of issuance, may be renewed or extended from time to time, over a period not exceeding five (5) years from the date of the original issuance of the BANs, in accord with I.C. §5-1.1-5, shall be prepayable on seven (7) days' notice in whole or in part in any authorized denomination without premium or penalty, shall bear interest at a rate not exceeding eight percent (8%) per annum, and shall be sold at a discount not exceeding ninety-nine percent(99%) of the principal amount thereof. Interest on the BANs shall be payable at maturity. It shall not be necessary for the City to repeat the procedures for the issuance of the 2012 Bonds as the procedures followed before the issuance of the BANs are for all purposes sufficient to authorize the issuance of the 2012 Bonds and to use proceeds thereof to repay the BANs. The principal of the BANs herein authorized is payable solely from proceeds received from the sale of the 2012 Bonds, and the interest thereon may be paid from such proceeds or -29 -