Authorizing Issuance of Revenue Bonds concerning construction of Improvements to Waterworks, not to exceed $2,050,000

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ARTICLE II PURPOSE OF BORROWING AND LOAN TERMS Section 2.01. Amount; Purpose. The State agrees to Loan an amount not to exceed Two Million Fifty Thousand Dollars ($2,050,000) in aggregate principal amount to the Qualified Entity as Financial Assistance to pay for the Eligible Costs, as hereinafter described, of the Project on, and subject to, the terms and conditions contained herein. The Loan shall be used only to pay the following Eligible Costs: (a) eligible planning services for the production of a Preliminary Engineering Report ("Planning"), (b) eligible design services for the production of Plans and Specifications ("Design") and (c) eligible construction costs, including financing and legal costs ("Construction" ). The Loan shall be funded solely from available proceeds of the Bond Bank Bonds contained in the Purchase Account or from other sources the State, in its sole discretion, may designate. The Loan is evidenced by the Bonds executed and delivered by the Qualified Entity contemporaneously herewith. The Bonds shall be in fully registered form, with the Bond Bank registered as the registered owner. Pursuant to certain agreements between the State and the Bond Bank, so long as the Bond Bank is the registered owner, the principal of and redemption premium, if any, and interest on the Bonds shall be paid to the Trustee by a wire transfer referenced as follows: Bank One Trust Company, NA, Indianapolis, Indiana; ABA No. 074 000 052; BNF: Corporate Trust Department; GL Account No: 325614. The Qualified Entity agrees to undertake and complete the Project and to receive and expend the Loan proceeds in accordance with this Agreement. Section 2.02. The Bonds. (a) The Bonds will not bear interest for the two year period from the date of this Agreement and thereafter will bear interest at the per annum rate of two and nine-tenths percent (2.9 %) (calculated on the basis of a 360-day year comprised of twelve 30-day months) until paid, as provided in I.C. 13-18-21-10 and -15. Interest, if any, on the Bonds will be payable on January 1 and July 1 of each year, commencing January 1, 2002. The Bonds will be in the aggregate principal amount of Two Million Fifty Thousand Dollars ($2,050,000). Subject to Section 2.05 herein, the Bonds will mature on January 1 of each of the years set forth in, and at the principal amount set opposite each such month and year set forth in, the schedule contained in Exhibit C to this Agreement; provided, however, notwithstanding the foregoing or the terms of the Bonds to the contrary, no maturity of Bonds shall extend beyond the date which is twenty (20) years after Substantial Completion of Construction. If the maturity date for any Bonds is beyond such date, unless otherwise agreed to, such Bonds, together with accrued and unpaid interest thereon, will be due and payable on such date. (b) The Bonds will be subject to redemption by the Qualified Entity as provided in the Authorizing Instrument. a3osas 6