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ARTICLE VI APPLICATION OF PROCEEDS OF BONDS Section 601. Deposits Into the Construction Fund. All moneys received by the Trustee from the Purchaser as Advances on the Bond shall be deposited in a special account of the Issuer in the Trustee, which account shall be designated "City of Batesville, Arkansas Taxable Industrial Development Revenue Bond Construction Fund - Scroll Compressors LLC Project" (the "Construction Fund"). Section 602. Disbursements From Construction Fund. Moneys in the Construction Fund shall be disbursed by the Trustee to the Company(or to its order)for Project Costs(as defined in the Lease Agreement). Such disbursements shall be in accordance with and pursuant to requisitions which shall be signed by a Company Representative. Each requisition shall be in substantially the form attached as Exhibit D hereto and shall specify: (a) The name of the person,firm,corporation or bank to whom payment is to be made; (b) The amount of the payment; (c) The purpose of the expenditure; and • (d) That the disbursement is for a proper item of Project Costs(as defined in the Lease Agreement). The Trustee shall keep records concerning and reflecting all disbursements from the Construction Fund and shall file an accounting of disbursements if and when requested by the Issuer, the Company, or the Purchaser. Section 603. Balance in Construction Fund. Upon receipt of the certificate specified in Section 3.4 of the Lease Agreement, the Trustee shall not accept any further requisitions pursuant to Section 602 hereof,but shall retain in the Construction Fund a sum equal to the amounts necessary for payment of the Project Costs not then due and payable as directed by a Company Representative. Any amount not to be retained in the Construction Fund for payment of Project Costs shall be used to prepay the Bonds. 19