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Repair and Replacement Fund <br /> Under the Loan Agreement, commencing in November, 2003, the Trustee will <br /> transfer from the Revenue Fund the Monthly Repair and Replacement Deposit ($775 per <br /> month) for deposit to the Repair and Replacement Fund created by the Indenture as more <br /> fully explained under "SECURITY FOR THE SERIES 2001 BONDS - Repair and <br /> Replacement Fund." Under certain circumstances,moneys in the Repair and Replacement <br /> Fund may be used to pay debt service on the Senior Bonds. All investment income from <br /> amounts on deposit in the Repair and Replacement Fund is to be credited to the Revenue <br /> Fund. <br /> Surplus Fund <br /> Excess moneys in the Revenue Fund after application to the funds and accounts in <br /> the Indenture shall be transferred to the Surplus Fund. Amounts in the Surplus Fund shall <br /> be used to fund shortfalls in the Bond Fund, the Taxes and Insurance Fund, the Operating <br /> Reserve Fund, the Debt Service Reserve Fund and the Repair and Replacement Fund, and <br /> to pay or reimburse for Operating Expenses. All investment income from amounts on <br /> deposit in the Surplus Fund is to be deposited in the Revenue Fund. (See"SECURITY FOR <br /> THE SERIES 2001 BONDS-Operating-Resc veSurplus Fund.") On each December 1,fifty <br /> percent(50%)of the moneys in the Surplus Fund will be used to redeem Subordinate Bonds, <br /> and the remaining fifty percent (50%) will be transferred to the Borrower if certain <br /> conditions have been met. <br /> Rate Covenant; Retention of Management Consultant <br /> The Borrower shall operate the Project, subject to applicable requirements or <br /> restrictions imposed by law, such that Net Revenues Available for Debt Service in each <br /> calendar quarter,commencing with the calendar quarter ending September 30,2003,will be <br /> at least 110% of Maximum Debt Service Requirements during such calendar quarter. The <br /> foregoing is subject to the qualification that if requirements necessary for the Sponsor to <br /> maintain its status as a 501(c)(3) Organization, or applicable state or federal laws or <br /> regulations, or the rules and regulations of agencies have jurisdiction, shall not permit the <br /> Borrower to produce the foregoing level of Net Revenues Available for Debt Service,then <br /> the Borrower shall, in conformity with the then prevailing requirements, laws, rules or <br /> regulations, maintain the maximum permissible level. <br /> If for any two consecutive calendar quarters ending on or after December 31,2003, <br /> Net Revenues Available for Debt Service are less than 110%of Debt Service Requirements <br /> for such periods, then the Borrower will promptly employ an Independent Management <br /> Consultant to review and analyze the financial reports required to be made by the Borrower <br /> and inspect the Project, its operation and administration. <br /> Bondholders' Risks <br />