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• the Assignment Fund; <br /> • the Residual Fund; and <br /> • the Rebate Fund. <br /> Amounts held in the Rebate Fund and the Residual Fund are not security for the Bonds and <br /> therefore are not available to pay the amounts due on the Bonds. <br /> Application of Loan Payments <br /> All payments under the Loan Agreement and paid to the Trustee are to be deposited by the <br /> Trustee under the Indenture as follows: (1) into the Interest Payment Account, at least the amount <br /> necessary to pay the interest on the Bonds on the next succeeding Interest Payment Date; and(2) into the <br /> Principal Payment Account, at least the amount necessary to pay the principal due on the Bonds on the <br /> next succeeding Interest Payment Date; provided that the amounts required to be deposited into the <br /> Interest Payment Account and the Principal Payment ent Account may be deposited in the form of either or <br /> P <br /> both moneyor direct obligations of the United States of America or obligations the full and prompt <br /> g g P P <br /> payment of which is secured by the pledge of the full faith and credit of the United States of America of <br /> those maturities and bearing the rate or rates of interest which will be sufficient, without further <br /> investment or reinvestment of either the principal amount thereof or the interest earnings thereon, to <br /> produce the amounts required to be on deposit on the next succeeding Interest Payment Date. <br /> Project Fund and Assignment Fund <br /> On the Closing Date, the Trustee is to use money in the Project Fund and the Interest Payment <br /> Account of the Bond Fund to purchase Eligible Investments. To the extent money is not otherwise <br /> provided to the Trustee, including money deposited into the Bond Fund or the Assignment Fund, the <br /> Trustee is to transfer from the Project Fund to the Bond Fund sufficient Available Money to make the <br /> necessary interest and principal payments on each Interest Payment Date without further written direction. <br /> Upon receipt of installments of Collateral Funds, the Trustee is to deposit such Collateral Funds <br /> in the Assignment Fund. Amounts on deposit in the Assignment Fund shall be invested in Eligible <br /> Investments that can be liquidated at or prior to the Initial Mandatory Tender Date at a price sufficient to <br /> pay Bond Service Charges on the Bonds as they become due. Each deposit into the Assignment Fund <br /> shall constitute an irrevocable deposit solely for the benefit of the Holders, subject to the provisions of the <br /> Indenture. <br /> To the extent money on deposit in the Project Fund is invested in Eligible Investments at the time <br /> of any requested and permitted disbursement under the Indenture, the Trustee is authorized to exchange <br /> an amount of such Eligible Investments in the Project Fund for a like amount of Collateral Funds on <br /> g J <br /> deposit in the Assignment Fund and then disburse such amount of Bond proceeds from the Project Fund <br /> without the need to sell or terminate such Eligible Investments prior to their stated maturity date; <br /> provided, however,that any such exchange must be accompanied by a requisition in the form attached to <br /> the Loan Agreement signed by the Authorized Borrower Representative that designates the Project costs <br /> to which amounts withdrawn from the Project Fund are allocated. <br /> Upon the maturity of the Bonds,the Trustee will redeem any investments in the Assignment Fund <br /> and deposit the proceeds thereof, and any other amounts then on deposit in the Assignment Fund, into the <br /> Bond Fund to pay Bond Service Charges on the Bonds, in accordance with the provisions of the <br /> Indenture. <br /> - 13 - <br />