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on, the Bonds; (8) any and all other moneys which are properly available and are appropriated by <br />the governing body of the City to the Debt Service Account. The amount of any surplus <br />remaining in the Debt Service Account when the Bonds and interest thereon are paid shall be <br />used consistent with Minnesota Statutes, Section 475.61, Subdivision 4. <br />No portion of the proceeds of the Bonds shall be used directly or indirectly to acquire <br />higher yielding investments or to replace funds which were used directly or indirectly to acquire <br />higher yielding investments, except (1) for a reasonable temporary period until such proceeds are <br />needed for the purpose for which the Bonds were issued and (2) in addition to the above in an <br />amount not greater than the lesser of five percent (501o) of the proceeds of the Bonds or $100,000. <br />To this effect, any proceeds of the Bonds and any sums from time to time held in the <br />Construction Account or Debt Service Account (or any other City account which will be used to <br />pay principal or interest to become due on the bonds payable therefrom) in excess of amounts <br />which under then -applicable federal arbitrage regulations may be invested without regard to yield <br />shall not be invested at a yield in excess of the applicable yield restrictions imposed by said <br />arbitrage regulations on such investments after taking into account any applicable "temporary <br />periods" or "minor portion" made available under the federal arbitrage regulations. Money in the <br />Fund shall not be invested in obligations or deposits issued by, guaranteed by or insured by the <br />United States or any agency or instrumentality thereof if and to the extent that such investment <br />would cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b) of the <br />Internal Revenue Code of 1986, as amended (the "Code"). <br />16. 1998B Bonds: Security. Until payment of the 1998B Bonds, all <br />provisions for the security thereof shall be observed by the City and all of its officers and agents. <br />17. Special Assessments. The City has heretofore levied special assessments <br />pursuant to the Prior Resolution, which have been pledged to the payment of the principal and <br />interest on the 1998B Bonds. All uncollected special assessments are now pledged to the <br />payment of principal of and interest -on the Bonds. The special assessments are such that if - <br />collected in full they, together "with estimated collections of other revenues herein pledged • for the <br />payment of the .Bonds, will produce at least five percent (54%) in excess of the amount needed to <br />.meet when due the principal'and interest payments on the Bonds. Consequently, no taxes are. <br />levied at -the present time. <br />18. General Obligation Page. For the prompt and full payment of the <br />principal of and. interest. on the Bonds as the same respectively become due, the full faith, credit <br />and taxing powers of the City shah be and are hereby. irrevocably pledged. • If the balance in the <br />Payment Account or Debt Service Account is ever insufficient to pay all principal and interest. <br />then due op the Bonds and any other Bonds payable therefrom, the deficiency shall be promptly <br />paid out of any other funds of the City which are available for such purpose,, and such other. <br />fimds may be reimbursed with or without interest from the Payment Account or Debt* Service <br />Account when a sufficient balance is available therein. <br />1222136.1 18 <br />