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reserves the right and power to reduce the levies in the manner and to the extent <br /> permitted by Minnesota Statutes, Section 475.61. <br /> 4.06. Full Faith and Credit Pledged. The full faith and credit of the City <br /> are irrevocably pledged for the prompt and full payment of the principal of and the <br /> interest on the Bonds, and the Bonds shall be payable from the Bond Fund in <br /> accordance with the provisions and covenants contained in this resolution. It is <br /> estimated that the special assessments and ad valorem taxes levied and to be levied <br /> for the payment of the Improvements will be collected in amounts not less than <br /> five percent (5%) in excess of the annual principal and interest requirements of the <br /> Bonds. If the money on hand in the Bond Fund should at any time be insufficient <br /> for the payment of principal and interest then due, this City shall pay the <br /> principal and interest out of any fund of the City, and such other fund or funds shall <br /> be reimbursed therefor when sufficient money is available to the Bond Fund. If on <br /> October 1 in any year the sum of the balance in the Bond Fund plus the amount of <br /> taxes and special assessments theretofore levied for the Improvements and <br /> collectible through the end of the following calendar year is not sufficient to pay <br /> when due all principal and interest become due on all Bonds payable therefrom in <br /> said following calendar year, or the Bond Fund has incurred a deficiency in the <br /> manner provided in this Section 4.06, a direct, irrepealable, ad valorem tax shall be <br /> levied on all taxable property within the corporate limits of the City for the purpose <br /> of restoring such accumulated or anticipated deficiency in accordance with the <br /> provisions of this resolution. <br /> Section 5. Defeasance. When any Bond has been discharged as <br /> provided in this Section 5, all pledges, covenants and other rights granted by this <br /> resolution to the holders of such Bonds shall cease, and such Bonds shall no longer <br /> be deemed outstanding under this Resolution. The City may discharge its <br /> obligations with respect to any Bond which is due on any date by irrevocably <br /> depositing with the Registrar on or before that date a sum sufficient for the payment <br /> thereof in full; or, if any Bond should not be paid when due, the City may <br /> nevertheless discharge its obligations with respect thereto by depositing with the <br /> Registrar a sum sufficient for the payment thereof in full with interest accrued to <br /> the date of such deposit. The City may also discharge its obligations with respect to <br /> any prepayable Bond called for redemption on any date when it is prepayable <br /> according to their terms, by depositing with the Registrar on or before that date a <br /> sum sufficient for the payment thereof in full; provided that notice of the <br /> redemption thereof has been duly given as provided in Section 3.05. The City may <br /> also at any time discharge its obligations with respect to any Bonds, subject to the <br /> provisions of law now or hereafter authorizing and regulating such action, by <br /> depositing irrevocably in escrow, with a bank qualified by law as an escrow agent for <br /> this purpose, cash or securities which are authorized by law to be so deposited, <br /> bearing interest payable at such times and at such rates and maturing on such dates <br /> as shall be required, without reinvestment, to pay all principal and interest to <br /> i <br /> -14- <br />