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• Section 3. Use of Proceeds. Upon payment for the Bonds by the <br /> Purchaser, the Finance Officer shall deposit the proceeds of the Bonds in the amount <br /> of$1,537,600 in the sinking fund established for the 1985B Bonds to be applied to the <br /> redemption and prepayment of the Refunded Bonds on February 1, 1991. The City <br /> Clerk shall cause notice of such redemption to be given as required by the resolution <br /> authorizing the issuance of the 1985B Bonds. <br /> Section 4. Series 1991A Refunding Bond Sinking Fund. The Bonds <br /> shall be payable from a separate and special Series 1991A Refunding Bond Sinking <br /> Fund (the Bond Fund) of the Issuer, which Bond Fund the Issuer agrees to maintain <br /> until the Bonds have been paid in full. If the money in the Bond Fund should at <br /> any time be insufficient to pay principal and interest due on the Bonds, such <br /> amounts shall be paid from other moneys on hand in other funds of the Issuer, <br /> which other funds shall be reimbursed therefor when sufficient money becomes <br /> available in said Bond Fund. The moneys on hand in the Bond Fund from time to <br /> time shall be used only to pay the principal of and interest on the Bonds. Into the <br /> Bond Fund shall be paid (i) all Bond proceeds received from the Purchaser in excess <br /> of$1,537,600, (ii) prior to and including February 1, 1993, collections of tax <br /> increments from Tax Increment Financing District No. 1 created within the Kenzie <br /> Terrace Redevelopment Project sufficient to pay when due the interest on the Bonds <br /> and, subsequent to February 1, 1993, all collections of tax increments from said <br /> District to the extent required to pay principal and interest on the Bonds when due, <br /> • (iii) all taxes collected pursuant to Section 5 hereof, and (iv) any other funds <br /> appropriated by the Council for the payment of the Bonds. <br /> Section 5. Pledge of Taxing Powers. For the prompt and full payment <br /> of the principal of and interest on the Bonds as such payments respectively become <br /> due, the full faith, credit and unlimited taxing powers of the Issuer shall be and are <br /> hereby irrevocably pledged. It is estimated that the collections of tax increments <br /> pledged to the payment of the principal of and interest on the Bonds will be not less <br /> than five percent in excess of amounts needed to meet when due the principal and <br /> interest payments on the Bonds, and therefore no ad valorem tax levy is presently <br /> required. <br /> Section 6. Defeasance. When all of the Bonds have been discharged as <br /> provided in this section, all pledges, covenants and other rights granted by this <br /> resolution to the registered owners of the Bonds shall cease. The Issuer may <br /> discharge its obligations with respect to any Bonds which are due on any date by <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, it may nevertheless be <br /> discharged by depositing with the Registrar a sum sufficient for the payment thereof <br /> in full with interest accrued from the due date to the date of such deposit. The <br /> Issuer may also at any time discharge its obligations with respect to any Bonds, <br /> ® -11- <br />