§ 295 — Defeasance

Section 295. Defeasance.

A series or part of a series of sinking fund bonds redeemable from the general sinking fund or any additional sinking fund established pursuant to section two hundred ninety-eight, including any covenants or other agreements relative thereto, shall be fully discharged and of no further force and effect at such time as (a) sufficient moneys or direct obligations of the United States or obligations guaranteed by the United States have been deposited in a separate trust account with a bank, trust company or other fiduciary, the principal of and/or interest on which will provide sufficient moneys to pay punctually when due at maturity or prior to maturity by redemption, in accordance with their terms, all principal of, applicable redemption premium, if any, and interest on such sinking fund bonds, and irrevocable instructions from the city to such bank, trust company or other fiduciary to make payment of such principal, applicable redemption premium, if any, and interest with such moneys shall have been given, or (b) such sinking fund bonds, together with interest thereon, shall have been paid in full at maturity, or shall have otherwise been refunded, redeemed, defeased or discharged.