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maximum annual amount of the Principal Component and the Interest Component of Base Rentals represented by the Certificates and (3) 125% of the average annual amount of the Principal Component and the Interest Component of Base Rentals represented by the Certificates (the "Reserve Requirement"). On January 15, 2017, the Reserve Requirement shall be reduced to an amount equal to 10% of the Principal Component of Base Rentals that will be outstanding after February 1, 2017, and any excess money in the Reserve Fund on January 15, 2017 shall be applied to the payment of the Principal Component of Base Rentals due on February 1, 2017. Except as provided in the preceding sentence, money in the Reserve Fund may be used solely (a) to make up any deficiencies in the Certificate Payment Fund and, if the money in the Certificate Payment Fund is insufficient to pay the Principal Component or the Interest Component of Base Rentals as the same become due, the Trustee is required to transfer from the Reserve Fund to the Certificate Payment Fund an amount sufficient to make up such deficiency or (b) to make the last payment of the Principal Component of Base Rentals. The Investment Securities held in the Reserve Fund are required to be valued at the market value thereof, excluding accrued interest. The Trustee is required to value the Reserve Fund (i) semiannually as of the last Business Day preceding each January 1 and July 1 (each, a "Valuation Date"), (ii) on any date there is a draw on the Reserve Fund, and (iii) upon any partial prepayment of the Certificates, and shall furnish a copy of such valuation to the City. If on any such date the Reserve Fund exceeds the Reserve Requirement, the Trustee shall promptly thereafter transfer such excess to the Certificate Payment Fund. If on any such date the amount in the Reserve Fund is less than the Reserve Requirement, the Trustee shall immediately notify and direct the City to replenish the Reserve Fund in the manner provided in the Lease. Base Lease The City will, pursuant to the Base Lease, lease all its interest in the Leased Property to the Trustee, as lessee. The Base Lease is for a term ending February 1, 2039 (which is 20 years after the latest scheduled maturity date of the Certificates), unless sooner terminated if the City makes all payments required by the Lease. If an Event of Default or Event of Nonappropriation occurs under the Indenture or the Lease, the Trustee has the right to possess and use the Leased Property for the remainder of the term of the Base Lease, and has the right to sublease or assign its interests under the Base Lease upon such terms as it deems prudent, so long as the Leased Property is operated for a public purpose. The proceeds from any assignment of the Base Lease and the Trustee's rights thereunder or any sublease of the Leased Property are required to be paid to the Trustee and applied in accordance with the Indenture. Owners of the Certificates are cautioned, however, that the nature of the Leased Property may impair the Trustee's ability to assign its interest in the Base Lease or to sublease the Leased Property upon the occurrence of an Event of Default or Event of Nonappropriation or to obtain an amount therefor that would be sufficient to pay the Principal Components and the Interest Components represented by all Certificates then Outstanding. See the caption "RISK FACTORS AND INVESTMENT CONSIDERATIONS -- Expiration or Termination of the Lease" herein. Maintenance and Insurance of the Leased Property The City has agreed in the Lease, at its own expense, to maintain, manage and operate the Leased Property in good order, condition and repair, ordinary wear and tear excepted. The City will provide or cause to be provided all security service, custodial service, janitor service, power, gas, telephone, light, heating, water and all other public utility services. As provided in the Lease, the Trustee and the Owners of the Certificates will not have any obligation to incur any expense of any kind or character for the management, operation or maintenance of the Leased Property during the term of the Lease. -9-