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I . ,i <br />All money in each of the accounts in the Allocation Fund <br />shall be held in trust for the benefit of the holders of the <br />Bonds and shall be applied, used and withdrawn only for the <br />purposes authorized in this Section 5. The proceeds of the <br />Allocation Fund shall be deposited with a legally qualified <br />depositor or depositories for funds of the City as now provided <br />by law and shall be segregated and kept separate and apart <br />from all other funds of the City and may be invested in <br />Qualified Investments, as such term is defined below. <br />(a) Bond Principal and Interest Account. <br />There shall be set aside within the Allocation <br />Fund and deposited in the Bond Principal and Interest <br />Account from the Tax Increment Revenue Account an <br />amount of money which, together with any money <br />contained therein, is equal to the aggregate amount <br />of the interest becoming due that calendar year <br />payable on all outstanding Bonds and the aggregate <br />principal amount of the outstanding Bonds becoming <br />due and payable on the next principal payment date, <br />except that for the deposit into this Account to <br />be made on the original date of issuance of the <br />Bond shall be for interest becoming due in 1986. <br />No deposit need be made into the Bond Principal <br />and Interest Account if the amount,contained therein <br />is at least equal to the aggregate amount of the <br />interest becoming due and payable on all outstanding <br />Bonds during that calendar year and the aggregate <br />principal amount of the outstanding Bonds maturing <br />by their terms on the next succeeding principal <br />payment date. All money in the Bond Principal and <br />Interest Account shall be used and withdrawn solely <br />for the purpose of paying the interest on and the <br />principal of the Bonds as it shall become due and <br />payable to the extent it is required therefor <br />(including accrued interest on any Bonds purchased <br />or redeemed prior to maturity). <br />(b) Reserve Account. There shall be set <br />aside from the Allocation Fund and deposited in <br />the Reserve Account from the Tax Increment Revenue <br />Account an amount of money that shall be required <br />to maintain the Reserve Account in the full amount <br />of the Debt Service Reserve Requirement (as defined <br />below). No deposit need be made in the Reserve <br />Account so long as there shall be on deposit therein <br />a sum equal to the lesser of fifteen percent (15 %) <br />OL of the original issuance price of the Bonds or the <br />average annual principal and interest payments <br />(which shall be calculated as payments due on August 1 <br />and the following February 1) on the outstanding <br />Bonds (the "Debt Service Reserve Requirement "). <br />-2- <br />12/19/85 KDB /tms <br />072024293 -City of South Bend -i -85.1 <br />