11-14-01 2. LOAN AGREEMENT - Laserfiche WebLink

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with all applicable requirements of the Code to the extent necessary or desirable in order to maintain the tax exempt status of all Series 2001 Tax- Exempt Bonds; (ii) no material changes shall be made without the approval thereof by the Inspecting Architect; (iii) no changes shall be made which in the aggregate increase the total Project Costs, unless amounts then on deposit in the Construction Account are sufficient, together with reasonably anticipated investment earnings thereon,to pay all Project Costs when anticipated to be due. In the event of a material default of any contractor under a construction contract or any other contract made in connection with the Project,or in the event of a material breach of warranty with respect to any materials,workmanship or performance,the Borrower will promptly proceed,either jointly,separately or in conjunction with others,to pursue diligently the remedies of the Borrower and the Trustee against the contractor or any subcontractor in default and against each surety on a bond,if any,securing the performance of such contract. Any amounts recovered by way of damages, refunds, adjustments or otherwise in connection with the foregoing,after deduction of expenses incurred in such recovery and after reimbursement to the Borrower of any amounts theretofore paid by the Borrower and not previously reimbursed to the Borrower for correction or remedying of the default which gave rise to the proceedings against the contractor or surety,shall be paid into the Construction Account if received before the Completion Date,and otherwise shall be paid into the Revenue Fund. Section 3.02 Agreement to Issue Bonds;Application of Bond Proceeds. In order to provide funds to loan to the Borrower for acquisition, development,construction and equipping of the Project,the City has, or will have, upon or promptly after the execution of this Agreement, issued and delivered the Series 2001 Bonds to the purchasers thereof,and the City has or will have deposited the net proceeds of said Series 2001 Bonds in accordance with Section 4.02 of the Indenture. Section 3.03 Disbursements from the Project Fund. The City has, in the Indenture, authorized and directed the Trustee to use the moneys in the Project Fund, including the Costs of Issuance Account and the Construction Account,to pay or reimburse the Borrower for payments made for the Project Costs. Disbursements by the Trustee of funds credited to the Project Fund shall be made to or at the direction of the Authorized Borrower Representative, as further provided in this Section 3.03, in the Indenture and in the Disbursing Agreement. Investment of funds credited to the Project Fund shall be made as provided in Section 3.07 hereof and in the Indenture. Moneys in the Project Fund shall be subject to withdrawal from time to time only for the purpose of paying for Project Costs if such payments shall not result in less than 95%of the net proceeds of the Bonds being used as required by Section 145 (a) of the Internal Revenue Code. The City and the Borrower agree that none of the moneys in the Project Fund shall be used for any purposes other than the payment or reimbursement of Project Costs and the payment of principal of,premium,if any,on and interest on the Bonds. Notwithstanding any other provision hereof,the Borrower covenants that the issuance costs financed by the Bonds(including underwriting discount)shall not exceed 2.00%of the proceeds of the Series 2001 Tax-Exempt Bonds. -19-