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5.02. Investment Yields and Applicable Arbitra e Regulations. No portion of the proceeds of the Bonds will be used directly or indirectly to acquire higher yielding investments or to replace funds which were used directly or indirectly to acquire higher yielding investments, except (i) for a reasonable temporary period until such proceeds are needed for the purpose for which the Bonds were issued, and (ii) in addition to the above, in an amount not greater than the lesser of 5% of the proceeds of the Bonds or $100,000. To this effect, any proceeds of the Bonds and any sums from time to time held in the Debt Service Fund (or any other City account which will be used to pay principal and interest to become due on the Bonds) in excess of amounts which under the applicable federal arbitrage regulations may be invested without regard as to yield will not be invested at a yield in excess of the applicable yield restrictions imposed by the arbitrage regulations on such investments after taking into account any applicable temporary periods or minor portion made available under the federal arbitrage regulations. In addition, the proceeds of the Bonds and money in the Fund will not be invested in obligations or deposits issued by, guaranteed by or insured by the United States or any agency or instrumentality thereof if and to the extent that such investment would cause the Bonds to be federally guaranteed within the meaning of Section 149(b) of the Internal Revenue Code of 1986, as amended (the "Code"). 5.03. Payment at Maturity or Redemption of Series 2002A and Series 20028 Bonds. It is hereby found and determined, based solely on the Verification Report of the Independent Accountant identified in the Escrow Agreement, that the monies available and appropriated to . the Escrow Account will be sufficient, together with the permitted earnings on the investment of the Escrow Account, to pay at maturity or upon redemption all of the principal of and interest on the Series 2002A Bonds and the Series 20028 Bonds. 5.04. Purchase of Securities and Compliance with the Act. Securities purchased from the monies in the Escrow Account will be limited to securities specified in Section 475.67, subdivision 8 of the Act. The Escrow Agent, as agent for the City, is hereby authorized and directed to purchase for and on behalf of the City and in its name, appropriate securities to fund the Escrow Account. Upon the issuance and delivery of the Bonds, the securities so purchased will be deposited in the Escrow Account established herein and held pursuant to the terms of the Escrow Agreement and the Resolution. 5.05. General Obligation Pled. For the prompt and full payment of the principal and interest on the Bonds, as the same respectively become due, the full faith, credit and taxing powers of the City will be and are hereby irrevocably pledged. If the balance in the Debt Service Fund is ever insufficient to pay all principal and interest then due on the Bonds and any other bonds payable therefrom, the deficiency will be promptly paid out of monies in the general fund of the City which are available for such purpose, and such general fund may be reimbursed with or without interest from the Debt Service Account when a sufficient balance is available therein. 5.06. Escrow Agreement. On or prior to the delivery of the Bonds, the Mayor and the City Administrator are hereby authorized and directed to execute on behalf of the City the . 365125v1 JSB EL185-11 15