AZ vs. CA:09 California Exhibits, Vol. IX; Nos. 400-457

page 18

-18- 1, 1965, or if any payment less than the whole thereof is made on account of said Item (1) then the amount of principal, together with interest thereon to October 1, 1965, remaining unpaid after applying such payments, first to interest then accrued, second, to the non-interest bearing portion of the principal, and, third, to the interest bearing portion of the principal of said Item (1). The District agrees to offer such quantity of the bonds so withheld as will make available proceeds to pay said Item (1), with interest in full at the time of said offering, at the earliest possible moment, and from time to time thereafter, if necessary, when, in the judgment and discretion of the Board of Directors of the District reasonably exercised, such bonds, or a part thereof, may be sold bearing interest at the rate of five per cent (5%) per annum or any lessor rate of interest and without limitation as to the use of the proceeds of such sale inconsistent with the application thereof to the payment of said Item (1). The obligation imposed by this paragraph concerning the withholding and sale of said bonds shall cease when the District shall have paid in full to the Department the amount of principal and interest in full, as specified in said Item (1) of the payments to be made herein. Article III. In addition to the amounts hereinbefore set forth, the Department has heretofore paid and advanced to the United States Bureau of Reclamation the sum of Fifty-five Thousand Dollars ($55,000.00) for the purposes hereinbefore set forth and recited on pages 1 to 3, inclusive, and to secure the making of preliminary investigations, surveys, and studies by said Bureau of the Boulder Dam Project for developing a water supply and hydroelectric supply for the benefit of the City and