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amounts received from investments thereof) must
have been spent on the designated projects.

ii. By twelve (12) months following receipt of the
proceeds, forty-five percent (45%) of the proceeds
(together with any amounts received from
investments thereof) must have been spent on the
designated projects.

iii. By eighteen (18) months following receipt of the
proceeds, seventy-five percent (75%) of the proceeds
(together with any amounts received from
investments thereof) must have been spent on the
designated projects.

iv. By twenty-four (24) months following receipt of the
proceeds, one hundred percent (100%) of the
proceeds (together with any amounts received from
investments thereof) must have been spent on the
designated projects.

D. Monitor the yield on the investments purchased with proceeds of the Obligations to
ensure the yield of such investments is restricted to the yield on the Obligations after
three years of the Issue Date;

E. Monitor the investment of all amounts deposited into a sinking fund or funds
pledged (directly or indirectly) to the payment of the Obligations, such as the
interest and sinking fund or debt service fund, to assure that the maximum amount
invested within such applicable fund at a yield higher than the yield on the
Obligations does not exceed an amount equal to the debt service on the
Obligations in the succeeding twelve-month period plus a carryover amount equal
to one-twelfth of the principal and interest payable on the Obligations for the
immediately preceding twelve-month period; and

F. The Responsible Person will ensure that funds transferred to a debt service fund are
expended within thirteen months from the date of transfer.

G. Ensure no more than 50% of the Obligation proceeds are invested in an investment
with a guaranteed yield for four years or more.

1 For more information regarding these expenditure schedules, please refer to McCall Parkhurst & Horton, L.L.P.’s
Memorandum entitled Arbitrage Rebate Regulations, attached to the Federal Tax Certificates for the Obligations at issue.
2 The spending requirements do not generally apply to amounts held in a reasonably required reserve fund, except
in certain cases related to the two-year exception period.
3 “Proceeds” as used in this Section VII(b) generally includes investment earnings, but excludes funds held in a bona fide
debt service fund

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