55B - RESO - WARNER ASSESSMENT DISTRICT

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In the event that amounts on deposit in the Redemption Fund are insufficient for the purpose set forth in the preceding paragraph, the Fiscal Agent shall transfer from the Reserve Fund, to the extent of any funds therein, to the Redemption Fund the amount of such insufficiency. If, after such a transfer from the Reserve Fund, there are insufficient funds in the Redemption Fund to make the payments provided for in the first paragraph of this Section 4.02(B), the Treasurer shall instruct the Fiscal Agent in writing to apply the available funds to the payment of the principal of and interest on the Bonds in the mamier and in the priorities provided in Section 8775 of the California Streets and Highways Code, as it existed on the Closing Date or as it may thereafter be amended. The Treasurer shall specify in such written instructions how the available funds shall be utilized to pay interest on and principal of the Bonds and the Fiscal Agent may conclusively rely upon such written instructions, and shall not have any responsibility or liability as a result of its reliance upon any such written instructions. When funds become available for the payment of the portion of the principal of any Bond which was not paid upon its maturity date, the Treasurer shall provide notice to the Owner of such Bond as provided in Section 8776 of the California Streets and Highways Code, On September 3 of each year, beginning on September 3, 2017, the amount on deposit in the Redemption Fund shall not exceed the greater of (i) one year's earnings on such amount, or (ii) one - twelfth (1 /12th) of Annual Debt Service for the then current Bond Year. If on September 3 of any year the amount on deposit in the Redemption Fund exceeds the maximum amount allowable pursuant to the preceding sentence and if on such September 3 the City shall have delivered to the Fiscal Agent an Officer's Certificate containing the information required below in this paragraph, the excess shall be transferred by the Fiscal Agent as directed by such Officer's Certificate to the Reserve Fund to the extent that the amount on deposit therein is less than the Reserve Requirement, and any such excess remaining thereafter shall be paid by the Fiscal Agent to the City as directed by such Officer's Certificate, On September 3 of each year, after any such excess amount has been transferred as hereinabove provided, the amount on deposit in the Redemption Fund shall not exceed the greater of (i) one year's earnings thereon, or (ii) one - twelfth (1 /12th) of Annual Debt Service for the then current Bond Year, An Officer's Certificate delivered by the City to Fiscal Agent pursuant to this paragraph shall (1) specify the dollar amount of the excess determined pursuant to the first sentence of this paragraph, (2) specify the dollar amount of such excess which the Fiscal Agent is to transfer to the Reserve Fund, and (3) specify the dollar amount of such excess which the Fiscal Agent is to pay to the City. Upon receipt of such an Officer's Certificate, the Fiscal Agent is authorized to act thereon without further inquiry, shall not be responsible for the accuracy of the statements contained therein, and shall be absolutely protected and incur no liability in relying on such Officer's Certificate. Amounts in the Redemption Fund shall also be withdrawn and deposited in the Rebate Fund as provided in Section 6.02 hereof. (C) Investment. Moneys in the Redemption Fund shall be invested and deposited in accordance with Section 6.01 hereof. Investment Earnings shall be retained in the Redemption Fund, except to the extent they are required to be deposited by the Fiscal Agent in the Rebate Fund in accordance with Section 6.02 hereof. -22- 55B -42