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Cancelled Bonds 811182 020- 4{ 1 a5 REGISTERED REGISTERED NUMBER R-1 $340,000.00 Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York Corporation ("DTC"), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other,name as is requested by an authorized representative of DTC (and any payment is made to Cede& Co. or to such other entity as is requested by an authorized representative of DTC), ANY TAAiSFER,.POIyDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO AN,Y PERSO140 WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. ....'' ••••. '- UNITED STATES OF AMERICA • STATE OF KANSAS •„. COUNTY OF SALINE CITY-OF SALINA _ • WATER AND SEWAGE SYSTEM REVENUE BOND SERIES 2011 ' Interest Maturity Dated CUSIP: —- Rate: 2.000% Date: October 1, 2012 Date: April 15, 2011 794811 JZ3 REGISTERED OWNER: CEDE& CO. PRINCIPAL AMOUNT: THREE HUNDRED FORTY THOUSAND DOLLARS KNOW ALL PERSONS BY THESE PRESENTS: That the City of Salina, in the County of Saline, State of Kansas (the "Issuer"), for value received, hereby acknowledges itself to be indebted and promises to pay to the Registered Owner shown above, or registered assigns, but solely from the source and in the manner herein specified, the Principal Amount shown above on the Maturity Date shown above, unless called for redemption prior to said Maturity Date, and to pay interest thereon at the Interest Rate per annum shown above (computed on the basis of a 360-day year of twelve 30-day months), from the Dated Date shown above, or from the most recent date to which interest has been paid or duly provided for, payable semiannually on April 1 and October 1 of each year, commencing October 1, 2011 (the "Interest Payment Dates"), until the Principal Amount has been paid. Method and Place of Payment. The principal or redemption price of this Series 2011 Bond shall be paid at maturity or upon earlier redemption to the person in whose name this Series 2011 Bond is registered at the maturity or redemption date thereof, upon presentation and surrender of this Series 2011 Bond at the principal office of the Treasurer of the State of Kansas, Topeka, Kansas (the "Paying Agent" and "Bond Registrar"). The interest payable on this Series 2011 Bond on any Interest Payment Date shall be paid to the person in whose name this Series 2011 Bond is registered on the registration books maintained by the Bond Registrar at the close of business on the Record Date(s) for such interest, which shall be the 15th day (whether or not a business day) of the calendar month next preceding the Interest Payment Date. Such interest shall be payable (a) by check or draft mailed by the Paying Agent to the address of such Registered Owner shown on the Bond Register or at such other address as is furnished to the Paying Agent in writing by such Registered Owner or, (b) in the case of an interest payment to any Registered Owner of$500,000 or more in aggregate principal amount of Series 2011 Bonds,by electronic transfer to such Registered Owner upon written notice given to the Bond Registrar by such Registered BOND IMPORTANT BOND BOOK ENTRY SECURITY I 1 91581310]1 , B11162 020627 • Owner, not less than 15 days prior to the Record Date for such interest, containing the electronic transfer instructions including the bank, ABA routing number and account number to which such Registered Owner wishes to have such transfer directed. The principal or redemption price of and interest on the Series 2011 Bonds shall be payable in any coin or currency that, on the respective dates of payment thereof, is legal tender for the payment of public and private debts. Interest not punctually paid will be paid in the manner established in the within defined Bond Resolution. •• • • • •, Definitions. Capitalized terms used herein and not otherwise defined herein shall have the mgantdgs as sigtntfllo such terms in the hereinafter defined Bond Resolution. ..... r Authorization of Series 2011 Bonds. This Series 2011 Bond is one of an authorized series of ••••• bonds cif the Wit?tlesignated"Water and Sewage System Revenue Bonds, Series 2011," aggregating the ""• priiitiaa amount of $16,120,000 (the "Series 2011 Bonds") issued for the purposes set forth in the • Ordinance of glre•Isster authorizing the issuance of the Series 2011 Bonds and the Resolution of the Issuer pre5crjbing the•fortn and details of the Series 2011 Bonds (collectively the "Bond Resolution"). The Setie,s.36 11 Bonds are issued by the authority of and in full compliance with the provisions, restrictions and liipithtions of the Constitution and laws of the State of Kansas, including K.S.A. 10-1201 et seq., as amended,'and all other provisions of the laws of the State of Kansas applicable thereto. Special Obligations. The Series 2011 Bonds are special obligations of the Issuer payable solely from, and secured as to the payment of principal and interest by a pledge of, the Net Revenues, and the . taxing power of the Issuer is not pledged to the payment of the Series 2011 Bonds either as to principal or interest. The Series 2011 Bonds shall not be or constitute a general obligation of the Issuer, nor shall they constitute an indebtedness of the Issuer within the meaning of any constitutional, statutory or charter provision, limitation or restriction. Under the conditions set forth in the Bond Resolution, the Issuer has the right to issue additional System Indebtedness payable from the same source and secured by the Revenues on a parity with said Revenues;provided, however, that such additional System Indebtedness may be so issued only in accordance with and subject to the covenants, conditions and restrictions • relating thereto set forth in the Bond Resolution. The Issuer hereby covenants and agrees with the Registered Owner of this Series 2011 Bond that it will keep and perform all covenants and agreements contained in the Bond Resolution, and will.fix, establish, maintain and collect such rates, fees and charges for the use and services furnished by or through the System, as will produce Net Revenues sufficient to pay the costs of operation and maintenance of the System, pay the principal of and interest on the Series 2011 Bonds as and when the same become due, and provide reasonable and adequate reserve funds. Reference is made to the Bond Resolution for a description of the covenants and agreements made by the Issuer with respect to the collection, segregation and application of the Revenues,the nature and extent of the security for the Series 2011 Bonds, the rights, duties and obligations of the Issuer with respect thereto, and the rights of the Registered Owners thereof. Redemption Prior to Maturity. The Series 2011 Bonds are subject to redemption prior to maturity, as follows: Optional Redemption. At the option of the Issuer, the Series 2011 Bonds maturing on October 1, in the years 2020 and thereafter will be subject to redemption and payment prior to maturity on October 1, 2019, or thereafter, as a whole or in part (selection of maturities and the amount of Series 2011 Bonds of each maturity to be redeemed to be determined by the Issuer in such equitable manner as it may determine) at any time, at the redemption price of 100% (expressed as a percentage of the principal amount),plus accrued interest to the date of redemption. 2 811162 020628 Mandatory Redemption. (a) 2024 Term Bonds. Each of the Series 2011 Bonds maturing on October 1, 2024 (the "2024 Term Bonds") shall also be subject to mandatory redemption and payment prior to maturity, pursuant to the redemption schedule set forth in the Bond Resolution at the Redemption Price of 100% (expressed as a percentage of the principal amount), plus accrued interest thereon to the Redemption Date. (b) 2031 Term Bonds. Each of the Series 2011 Bonds maturing on October 1, 2031 (the "Term gondsb shall also be subject to mandatory redemption and payment prior to maturity, pursuant to the raacitption olvd'.le set forth in the Bond Resolution at the Redemption Price of 100% (expressed as a •••• percentage of tbpiincipal amount),plus accrued interest thereon to the Redemption Date. ...... . 'Redeirpltdh Denominations. Whenever the Bond Registrar is to select Series 2011 Bonds for • .. tleWrrpose di redemption, it shall, in the case of Series 2011 Bonds in denominations greater than a ..... min imum Authorizeil Denomination, if less than all of the Series 2011 Bonds then Outstanding are to be • .. callifor redemption, treat each minimum Authorized Denomination of face value of each such Series 201J.Bond as though it were a separate Series 2011 Bond in the denomination of a minimum Authorized Denon}igation. • • Notice of Redemption. Notice of redemption, unless waived, shall be given by the Issuer to the State Treasurer of Kansas, to the Purchaser of the Series 2011 Bonds and to the Bond Registrar in accordance with the Bond Resolution. The Issuer shall cause the Bond Registrar to notify each Registered Owner at the address maintained on the Bond Register, such notice to be given by mailing an official notice of redemption by first class mail at least 30 days prior to the redemption date. Notice of redemption having been given as aforesaid, the Series 2011 Bonds or portions of Series 2011 Bonds to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified, and from and after such date(unless the Issuer defaults in the payment of the redemption price) such Series 2011 Bonds or portions of Series 2011 Bonds shall cease to bear interest. Book-Entry System. The Series 2011 Bonds are being issued by means of a book-entry system with no physical distribution of bond certificates to be made except as provided in the Bond Resolution. One certificate with respect to each date on which the Series 2011 Bonds are stated to mature or with respect to each form of Series 2011 Bonds, registered in the nominee name of the Securities Depository, is being issued and required to be deposited with the Securities Depository and immobilized in its custody. The book-entry system will evidence positions held in the Series 2011 Bonds by the Securities Depository's participants, beneficial ownership of the Series 2011 Bonds in Authorized Denominations being evidenced in the records of such participants. Transfers of ownership shall be effected on the records of the Securities Depository and its participants pursuant to rules and procedures established by the Securities Depository and its participants. The Issuer and the Bond Registrar will recognize the Securities Depository nominee, while the Registered Owner of this Series 2011 Bond, as the owner of this Series 2011 Bond for all purposes, including (i) payments of principal of, and redemption premium, if any, and interest on,this Series 2011 Bond, (ii)notices and(iii) voting. Transfer of principal, interest and any redemption premium payments to participants of the Securities Depository, and transfer of principal, interest and any redemption premium payments to Beneficial Owners of the Series 2011 Bonds by participants of the Securities Depository will be the responsibility of such participants and other nominees of such Beneficial Owners. The Issuer and the Bond Registrar will not be responsible or liable for such _ transfers of payments or for maintaining, supervising or reviewing the records maintained by the Securities Depository, the Securities Depository nominee, its participants or persons acting through such participants. While the Securities Depository nominee is the Owner of this Series 2011 Bond, notwithstanding the provision hereinabove contained, payments of principal of, redemption premium, if any, and interest on this Series 2011 Bond shall be made in accordance with existing arrangements among the Issuer,the Bond Registrar and the Securities Depository. 3 811162 020629 Transfer and Exchange. EXCEPT AS OTHERWISE PROVIDED IN THE BOND RESOLUTION, THIS GLOBAL BOND MAY BE TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES DEPOSITORY OR TO A SUCCESSOR SECURITIES DEPOSITORY OR TO A NOMINEE OF A SUCCESSOR • SECURITIES DEPOSITORY. This Series 2011 Bond may be transferred or exchanged, as provided in tlre•$ohd Resolution, only on the Bond Register kept for that purpose at the principal office of the Bond Registrar, upon surrender of this Series 2011 Bond together with a written instrument of transfer or auslteriyation for ea change satisfactory to the Bond Registrar duly executed by the Registered Owner or • •••• the Jtegistereel•Qeder s duly authorized agent, and thereupon a new Series 2011 Bond or Series 2011 ....t Bonds in any Authorized Denomination of the same maturity and in the same aggregate principal amount be issued.to•ttle transferee in exchange therefor as provided in the Bond Resolution and upon ••••t paylfieft.of the charges therein prescribed. The Issuer shall pay all costs incurred in connection with the "'• issuta , paynteme d initial registration of the Series 2011 Bonds and the cost of a reasonable supply of 'bond.bJ3nks. 'flee Issuer and the Paying Agent may deem and treat the person in whose name this Series 201.1.11a-id is registered on the Bond Register as the absolute owner hereof for the purpose of receiving payment•Qf, or on account of, the principal or redemption price hereof and interest due hereon and for all • otherpurlloses. The Series 2011 Bonds are issued in fully registered form in Authorized Denominations. Authentication. This Series 2011 Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the hereinafter defined Bond Resolution until the Certificate of Authentication and Registration hereon shall have been lawfully executed by the Bond Registrar. IT IS HEREBY DECLARED AND CERTIFIED that all acts, conditions, and things required to be done and to exist precedent to and in the issuance of this Series 2011 Bond have been properly done and performed and do exist in due and regular form and manner as required by the Constitution and laws of the State of Kansas, that the total indebtedness of the Issuer, including this series of bonds, does not exceed any constitutional or statutory limitation, and that provision has been duly made for the collection and segregation of the Revenues of the Water and Sewage System (the "System") and for the application of the same as provided in the hereinafter defined Bond Resolution. IN WITNESS WHEREOF, the Issuer has caused this Series 2011 Bond to be executed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its Clerk, • and its seal to be affixed hereto or imprinted hereon. etoF K CITY OF SALINA, KANSAS AS Icy Mayor ATTEST: Clerk G/ • 4 . • 811162020630 • • CERTIFICATE OF AUTHENTICATION AND REGISTRATION This Series 2011 Bond is one of a series of Water and Sewage System Revenue Bonds, Series 2011, of the City of Salina,Kansas,described in the within-mentioned Bond Resolution. Roiistr�pon Date APR 2 9 2011 00000 ". Office of the State Treasurer, ••••• • ••••• Topeka, Kansas, ••••• • as Bond Registrar and Paying Agent .••••• • :::.. ••.•.G.A• • ..•• •• • • By � Lby F4111.••• • • ••••• Regii!ra!ion Number 0322-085-041511-950 • CERTIFICATE OF CLERK STATE OF KANSAS ) SS. COUNTY OF SALINE • The undersigned, Clerk of the City of Salina, Kansas, does hereby certify that the within Series 2011 Bond has been duly registered in my office according to law as of April 15, 2011. WITNESS my hand and official seal. OF Clerk CERTIFICATE OF STATE TREASURER OFFICE OF THE TREASURER, STATE OF KANSAS RON ESTES, Treasurer of the State of Kansas, does hereby certify that a transcript of the proceedings leading up to the issuance of this Series 2011 Bond has been filed in the office of the State Treasurer, and that this Series 2011 Bond was registered in such office according to law on APR 2;9 9011 WITNESS my hand and official seal. 1St At (Seal) By: Treasurer of the State of Kansas • • 5 . _ • B11162020631 • BOND ASSIGNMENT • •.; FOR VALUE RECEIVED, the undersigned do(es)hereby sell, assign and transfer to • ••••. •••' (Name and Address) ...... .•.... • (Social Security or Taxpayer Identification No.) • • •• •the.Strip 2011 Bond to which this assignment is affixed in the outstanding principal amount of $ ••••• , standing in the name of the undersigned on the books of the Bond Registrar. The undere3igjed do(es) hereby irrevocably constitute and appoint as agent to transfer said Series 2011 Bond on the books of said Bond Registrar with full power of substitution in the premises. Dated Name Social Security or Taxpayer Identification No. Signature (Sign here exactly as name(s) appear on the face of Certificate) Signature guarantee: By 6 B11162020632 • LEGAL OPINION The following is a true and correct copy of the approving legal opinion of Gilmore & Bell, P.C., Bond Counsel, which was dated and issued as of the date of original issuance and delivery of such Series 213•1•1 fonds: • GILMORE&BELL,P.C. •• • . AttomeysatLaw •...•• '•••• 2405 Grand Boulevard • • Suite 1100 ••"" • ..... Kansas City,Missouri 64108-2521 • • .. • . • •• • • • • ...... .•.•• ...... Governing Body Morgan Keegan& Co., Inc. City of Salina, Kansas Memphis,Tennessee Re: $16,120,000 Water and Sewage System Revenue Bonds, Series 2011, of the City of Salina,Kansas, Dated April 15, 2011 We have acted as Bond Counsel in connection with the issuance by the City of Salina, Kansas (the `Issuer"), of the above-captioned bonds (the "Series 2011 Bonds"). In this capacity, we have examined the law and the certified proceedings, certifications and other documents that we deem necessary to render this opinion. The Series 2011 Bonds have been authorized pursuant to an Ordinance and Resolution adopted by the governing body of the Issuer (collectively, the "Bond Resolution"). Capitalized terms used and not otherwise defined in this opinion shall have the meanings assigned to those terms in the Bond Resolution. Regarding questions of fact material to our opinion, we have relied on the certified proceedings and other certifications of public officials and others furnished to us without undertaking to verify them by independent investigation. Based upon the foregoing, we are of the opinion, under existing law,as follows: 1. The Issuer is a city of the first class with power to adopt the Bond Resolution, perform the agreements on its part contained therein, and issue the Series 2011 Bonds. 2. The Series 2011 Bonds have been duly authorized, executed and delivered by the Issuer and are valid and legally binding special obligations of the Issuer. 3. The Series 2011 Bonds are payable solely from the Net Revenues derived by the Issuer from the operation of the System. The Series 2011 Bonds do not constitute general obligations of the Issuer and do not constitute an indebtedness of the Issuer within the meaning of any constitutional or statutory 7 B11162 020633 provision, limitation or restriction. The taxing power of the Issuer is not pledged to the payment of the Series 2011 Bonds. 4. The Bond Resolution has been duly adopted by the Issuer and constitutes a valid and legally binding obligation of the Issuer enforceable against the Issuer. The Bond Resolution creates a valid lien on the Net Revenues and other funds pledged by the Bond Resolution for the security of the Series 2t?ll Donds on a parity with any Parity Bonds issued or to be issued,as provided in the Bond Resolution. • •• • •••••: 5. .•"Me interest on the Series 2011 Bonds (including any original issue discount properly • ••••• allocable to 5n•ewner of a Series 2011 Bond) is excluded from gross income for federal income tax • p;Fpoi4s. Interest on the Series 2011 Bonds is not an item of tax preference for purposes of the federal alternative m47triurn tax imposed on individuals and corporations but is taken into account in determining •••S•• adjur t current e pings for the purpose of computing the alternative minimum tax imposed on certain •• corporations. fit of inions set forth in this paragraph are subject to the condition that the Issuer comply • with•al4•requirements of the Internal Revenue Code of 1986, as amended (the "Code"), that must be satiaRCG subsequent to the issuance of the Series 2011 Bonds in order to preserve the exclusion of the • interast•vit the Series 2011 Bonds from gross income for federal income tax purposes. The Issuer has covenanted to comply with all of these requirements. Failure to comply with certain of these requirements may cause interest on the Series 2011 Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the Series 2011 Bonds. The Series 2011 Bonds have not been designated as "qualified tax-exempt obligations" for purposes of Section 265(b) of the Code. We express no opinion regarding other federal tax consequences arising with respect to the Series 2011 Bonds. 6. The interest on the Series 2011 Bonds is excluded from computation of Kansas adjusted gross income. We express no opinion regarding the accuracy, completeness or sufficiency of the Official Statement or other offering material relating to the Series 2011 Bonds (except to the extent, if any, stated . in the Official Statement). Further, we express no opinion regarding the perfection or priority of the lien on the Net Revenues or other funds pledged under the Bond Resolution or tax consequences arising with respect to the Series 2011 Bonds other than as expressly set forth in this opinion. The rights of the owners of the Series 2011 Bonds and the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights generally and by equitable principles, whether considered at law or in equity. This opinion is given as of its date, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may come to our attention or any changes in law that may occur after the date of this opinion. GILMORE &BELL, P.C. • 8 r m. ' a m w w o ry s �^ ''�' m 'd m 'a .'� ',Fe o Y H c ra a a � ac. w . ski. `dL� _ .. rP O- w Q7• •M 6 . • �.0.' 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F 0 n 0 m a va n a 0 77 a t0 n td p 0 0 OR 0 O oa < Ev ° 0 �' N A• tla O N ° �. w , < 'O M F' a O rJ a b 0 (°D p p O w N x Q• H O^ 0 "' -n X in' v' .4 �. 0 y O rn v'' 0. .-. w 09 p tla 0 0 y 0 � 0+ 00 io n o t�4o .b pG+ ° �. 0 O �' G td vN, (�7 27 n vGOi• w O N " N O� 0 ."r' �' O x p `<cr w `< h p p p w arw„ 0 0 r o ?» -n C 0 C y c _ 0 tdrn rn o a O w 0 w H p .'1 ° O f» a N ^n N N '-' v' w � x `”' OQ a 0 .py w o x N O w EL n. 0 w rn N o < (� o' p 0 o o N.o Cd a. o ° 0 p, G 0 UQ w -0 27 n tj No O; G . ti rn x y rro o [GO b .°< v0, cn b 'G N � w p O O 0 p �. O CD x ` 0 w G vi -0 H y N I N RL O tj 0 �� .9t UQ o K N Q w ,3 O w `_� — � p � .0�.. w � c cn ° o a �. `-°, °-� ,G�-. `�° °o F) coo v, rn R• C 'J R O. v, 0 v, O v, N O `G � Qa x << w P. P. O .mot ; • B11162020642 ". REGISTERED REGISTERED Q 9 NUMBER R-3 $630,000.00 Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York Corporation ("DTC"), to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede &-Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. UNITED STATES OF AMERICA STATE OF KANSAS COUNTY OF SALINE CITY OF SALI\'A , WATER AND SEWAGE SYSTEM REVENUE BOND SERIES2011 •••• • • Interest Maturity Dated .CUSI41.;.•• • Rate: 2.000% Date: October 1, 2014 Date: April 15, 2011 .i948 ' 4 . ... .... REGISTERED OWNER: CEDE & CO. •••• • PRINCIPAL AMOUNT: SIX HUNDRED THIRTY THOUSAND DOLLARS •• KNOW ALL PERSONS BY THESE PRESENTS: That the City of Salina, in the County of Saline. State of Kansas (the "Issuer"), for value received, hereby acknowledges itself to be indebted and promises to pay to the Registered Owner shown above, or registered assigns, but solely from the source and in the manner herein specified, the Principal Amount shown above on the Maturity Date shown above, unless called for redemption prior to said Maturity Date, and to pay interest thereon at the Interest Rate per annum shown above (computed on the basis of a 360-day year of twelve 30-day months), from the Dated Date shown above, or from the most recent date to which interest has been paid or duly provided for, payable semiannually on April 1 and October 1 of each year, commencing October 1, 2011 (the "Interest Payment Dates"), until the Principal Amount has been paid. Method and Place of Payment. The principal or redemption price of this Series 2011 Bond shall be paid at maturity or upon earlier redemption to the person in whose name this Series 2011 Bond is registered at the maturity or redemption date thereof, upon presentation and surrender of this Series 2011 Bond at the principal office of the Treasurer of the State of Kansas, Topeka, Kansas (the "Paying Agent" and "Bond Registrar"). The interest payable on this Series 2011 Bond on any Interest Payment Date shall Yr be paid to the person in whose name this Series 2011 Bond is registered on the registration books /. maintained by the Bond Registrar at the close of business on the Record Date(s) for such interest, which • shall be the 15th day (whether or not a business day) of the calendar month next preceding the Interest Payment Date. Such interest shall be payable (a) by check or draft mailed by the Paying Agent to the . address of such Registered Owner shown on the Bond Register or at such other address as is furnished to the Paying Agent in writing by such Registered Owner or, (b) in the case of an interest payment to any Registered Owner of 5500,000 or more in aggregate principal amount of Series 2011 Bonds,by electronic / transfer to such Registered Owner upon written notice given to the Bond Registrar by such Registered/ BOND IMPORTANT BOND - 9158131071 BOOK ENTRY SECURITY • 81116 020643 ° ' .• Owner, not less than 15 days prior to the Record Date for such interest, containing the electronic transfer instructions including the bank. ABA routing number and account number to which such Registered Owner wishes to have such transfer directed. The principal or redemption price of and interest on the Series 2011 Bonds shall be payable in any coin or currency that, on the respective dates of payment thereof, is legal tender for the payment of public and private debts. Interest not punctually paid will be paid in the manner established in the within defined Bond Resolution. Definitions. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the hereinafter defined Bond Resolution. Authorization of Series 2011 Bonds. This Series 2011 Bond is one of an authorized series of bonds of the Issuer designated "Water and Sewage System Revenue Bonds, Series 2011," aggregating the principal amount of S16,120,000 (the "Series 2011 Bonds") issued for the purposes set forth in the Ordinance of the Issuer authorizing the issuance of the Series 2011 Bonds and the Resolution of the Issuer prescribing the form and details of the Series 2011 Bonds (collectively the "Bond Resolution"). The Series 2011 Bonds are issued by the authority of and in full compliance with the provisions, restrictions and limitations of the Constitution and laws of the State of Kansas, including K.S.A. 10-1201 pst.jr, as amended, and all other provisions of the laws of the State of Kansas applicable thereto. •Special Obligations. The Series 2011 Bonds are special obligations of the Jvsuej payablesolely •••• from, and secured as to the payment of principal and interest by a pledge of, the Net Revenues' .tttl.the taxing power of the Issuer is not pledged to the payment of the Series 2011 Bonds oil/lei-sad-3 w2s to pri)cj3al or interest. The Series 2011 Bonds shall not be or constitute a general obligation of the Issuer, norj011•rhey • constitute an indebtedness of the Issuer within the meaning of any constitutionaj?Sthtutory or charter provision, limitation or restriction. Under the conditions set forth in the Bond Rese tion, the Issuer has the right to issue additional System Indebtedness payable from the same source and secured by the Revenues on a parity with said Revenues;provided, however, that such additional System Indebledttess may be so issued only in accordance with and subject to the covenants, conditions and restrictions relating thereto set forth in the Bond Resolution. The Issuer hereby covenants and agrees with the Registered Owner of this Series 2011 Bond that it will keep and perform all covenants and agreements contained in the Bond Resolution, and will fix, establish, maintain and collect such rates, fees and charges for the use and services furnished by or through the System, as will produce Net Revenues sufficient to pay the costs of operation and maintenance of the System, pay the principal of and interest on the Series 2011 Bonds as and when the same become due, and provide reasonable and adequate reserve funds. Reference is made to the Bond Resolution for a description of the covenants and agreements made by the Issuer with respect to the collection, segregation and application of the Revenues, the nature and extent of the security for the Series 2011 Bonds, the rights, duties and obligations of the Issuer with respect thereto, and the rights of the Registered Owners thereof. Redemption Prior to Maturity. The Series 2011 Bonds are subject to redemption prior to — r maturity, as follows: r G Optional Redemption. At the option of the Issuer, the Series 2011 Bonds maturing on October 1, in the years 2020 and thereafter will be subject to redemption and payment prior to maturity on October 1, 2019, or thereafter, as a whole or in part (selection of maturities and the amount of Series 2011 Bonds of each maturity to be redeemed to be determined by the Issuer in such equitable manner as it may - determine) at any time, at the redemption price of 100% (expressed as a percentage of the principal amount),plus accrued interest to the date of redemption. J j B11162020644' 11162 020644 • • • Mandatory Redemption. (a) 2024 Term Bonds. Each of the Series 2011 Bonds maturing on October 1, 2024 (the "2024 Term Bonds") shall also be subject to mandatory redemption and payment prior to maturity, pursuant to the redemption schedule set forth in the Bond Resolution at the Redemption • Price of 100% (expressed as a percentage of the principal amount), plus accrued interest thereon to the Redemption Date. (b) 2031 Term Bonds. Each of the Series 2011 Bonds maturing on October 1, 2031 (the "Term Bonds") shall also be subject to mandatory redemption and payment prior to maturity, pursuant to the redemption schedule set forth in the Bond Resolution at the Redemption Price of 100% (expressed as a percentage of the principal amount), plus accrued interest thereon to the Redemption Date. Redemption Denominations. Whenever the Bond Registrar is to select Series 2011 Bonds for the purpose of redemption, it shall, in the case of Series 2011 Bonds in denominations Beater than a minimum Authorized Denomination, if less than all of the Series 2011 Bonds then Outstanding are to be called for redemption, treat each minimum Authorized Denomination of face value of each such Series 2011 Bond as though it were a separate Series 2011 Bond in the denomination of a minimum Authorized Denomination. .... Notice of Redemption. Notice of redemption, unless waived, shall be given by the 'Alto 46 the State Treasurer of Kansas, to the Purchaser of the Series 2011 Bonds and to tljg�Bend Registrar in •..• accordance with the Bond Resolution. The Issuer shall cause the Bond Registrar. to Mil"'each Registered Owner at the address maintained on the Bond Register, such notice to U406411 by m tng an official notice of redemption by first class mail at least 30 days prior to the redemptiomdate. UttCe of redemption having been given as aforesaid, the Series 2011 Bonds or portions of Seel '4011 Bonds to be . • redeemed shall, on the redemption date, become due and payable at the reden+ption price therein specified, and from and after such date (unless the Issuer defaults in the payment of the redemption price) such Series 2011 Bonds or portions of Series 2011 Bonds shall cease to bear interest. •'•' Book-Entry System. The Series 2011 Bonds are being issued by means of a book-entry system with no physical distribution of bond certificates to be made except as provided in the Bond Resolution. One certificate with respect to each date on which the Series 2011 Bonds are stated to mature or with respect to each form of Series 2011 Bonds, registered in the nominee name of the Securities Depository, is being issued and required to be deposited with the Securities Depository and immobilized in its custody. The book-entry system will evidence positions held in the Series 2011 Bonds by the Securities Depository's participants, beneficial ownership of the Series 2011 Bonds in Authorized Denominations • being evidenced in the records of such participants. Transfers of ownership shall be effected on the records of the Securities Depository and its participants pursuant to rules and procedures established by the Securities Depository and its participants. The Issuer and the Bond Registrar will recognize the Securities Depository nominee, while the Registered Owner of this Series 2011 Bond, as the owner of this Series 2011 Bond for all purposes, including (i) payments of principal of, and redemption premium, if any, and interest on, this Series 2011 Bond, (ii) notices and (iii) voting. Transfer of principal, interest and any redemption premium payments to participants of the Securities Depository, and transfer of principal, interest and any redemption premium payments to Beneficial Owners of the Series 2011 Bonds by 7 .f participants of the Securities Depository -/will be the responsibility of such participants and other nominees / of such Beneficial Owners. The Issuer and the Bond Registrar will not be responsible or liable for such transfers of payments or for maintaining, supervising or reviewing the records maintained by the Securities Depository, the Securities Depository nominee, its participants or persons acting through such participants. While the Securities Depository nominee is the Owner of this Series 2011 Bond , notwithstanding the provision hereinabove contained, payments of principal of, redemption premium, if . any, and interest on this Series 2011 Bond shall be made in accordance with existing arrangements among f the Issuer,the Bond Registrar and the Securities Depository. "C ■ 3 B11162020645 4 • • i r : • Transfer and Exchange. EXCEPT AS OTHERWISE PROVIDED LN THE BOND RESOLUTION, THIS GLOBAL BOND MAY BE TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMLNEE OF THE SECURITIES DEPOSITORY OR TO A SUCCESSOR SECURITIES DEPOSITORY OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY. This Series 2011 Bond may be transferred or exchanged, as provided in the Bond Resolution, only on the Bond Register kept for that purpose at the principal office of the Bond Registrar, upon surrender of this Series 2011 Bond together with a written instrument of transfer or authorization for exchange satisfactory to the Bond Registrar duly executed by the Registered Owner or the Registered Owner's duly authorized agent, and thereupon a new Series 2011 Bond or Series 2011 Bonds in any Authorized Denomination of the same maturity and in the same aggregate principal amount shall be issued to the transferee in exchange therefor as provided in the Bond Resolution and upon payment of the charges therein prescribed. The Issuer shall pay all costs incurred in connection with the issuance, payment and initial registration of the Series 2011 Bonds and the cost of a reasonable supply of bond blanks. The Issuer and the Paying Agent may deem and treat the person in whose name this Series 2011 Bond is registered on the Bond Register as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or redemption price hereof and interest due hereon and 6c all other purposes. The Series 2011 Bonds are issued in fully registered form in Authorized Denomiaipns. • Authentication. This Series 2011 Bond shall not be valid or become obliplttoiw for any purpose • • or be entitled to any security or benefit under the hereinafter defined Bond Resolution until the ce skate of Authentication and Registration hereon shall have been lawfully executed by the d•Cegistrl"C"' ' Boa • 3,,.•:• H IS HEREBY DECLARED AND CERTIFIED that all acts, condition,ttn�,hings required • to be done and to exist precedent to and in the issuance of this Series 2011 Bond hale beefs properly done •••• and performed and do exist in due and regular form and manner as required by the Constitutior•ana•lws of the State of Kansas, that the total indebtedness of the Issuer, including this series of bonds, djtvnot exceed any constitutional or statutory limitation, and that provision has been duly made for the 6ithction and segregation of the Revenues of the Water and Sewage System (the "System") and for the application of the same as provided in the hereinafter defined Bond Resolution. IN WITNESS WHEREOF, the Issuer has caused this Series 2011 Bond to be executed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its Clerk, and its seal to be affixed hereto or imprinted hereon. CITY OF SALINA, KANSAS "4;0(OF I 1970 (. �- Mavor,'.,, J ATTEST: Clerk 4 • ...._ B11162020646 1 • ' 1 _ CERTIFICATE OF AUTHENTICATION AND REGISTRATION This Series 2011 Bond is one of a series of Water and Sewage System Revenue Bonds. Series 2011, of the City of Salina,Kansas, described in the within-mentioned Bond Resolution. -r Registration Date APR 2--9 2011' Office of the State Treasurer, Topeka, Kansas, as Bond Registrar and PayiingAtS) Agent • By Registration Number 0322-085-041511-950 CERTIFICATE OF CLERK ••••• • • STATE OF KANSAS ) � • • • •• ) SS. • .••••. COUNTY OF SALINE ) • 11 ••:• • • The undersigned, Clerk of the City of Salina. Kansas, does hereby certify that the.tlitttr.Series • • • 2011 Bond has been duly registered in my office according to law as of April 15, 2011. •• . • WITNESS my hand and official seal. . • evo .•�-� ' Clerk , CERTIFICATE OF STATE TREASURER -...„-',....— OFFICE OF THE TREASURER, STATE OF KANSAS '- RON ESTES, Treasurer of the State of Kansas, does hereby certify that a transcript of the - proceedings leading up to the issuance of this Series 2011 Bond has been filed in the office of the State . Treasurer, and that this Series 2011 Bond was registered in such office according to law •on . 'APR- 2. 9 2411 . . WITNESS my hand and official seal. t� (Seal) By: �_ E_ - /i Treasurer of the State of Kansas /• / . 1 1 • 81116202064H°° ' • BOND ASSIGNMENT FOR VALUE.RECEIVED, the undersigned do(es) hereby sell, assign and transfer to • (Name and Address) (Social Security or Taxpayer Identification No.) the Series 2011 Bond to which this assignment is affixed in the outstanding principal amount of S , standing in the name of the undersigned on the books of the Bond Registrar. The undersigned do(es) hereby irrevocably constitute and appoint a$•@gdttt to transfer said Series 2011 Bond on the books of said Bond Registrar with full power of substitution in the premises. • .... •• • •..• '.. • Dated "' • Name •••• • - Social Security or Taxpayer Identification No. •.•• • Signature(Sign here exactly as name(s) appear on the face of Certificate) Signature guarantee: By y • 6 • 811162020648 LEGAL OPINION The following is a true and correct copy of the approving legal opinion of Gilmore & Bell, P.C., Bond Counsel, which was dated and issued as of the date of original issuance and delivery of such Series 2011 Bonds: GILMORE& BELL,P.C. Attorneys at Law 2405 Grand Boulevard Suite 1100 Kansas City, Missouri 64108-2521 • • •••• Governing Body Morgan Keegan& Co., Ince• ••• City of Salina,Kansas Memphis,Tennessee • • . Re: 516,120,000 Water and Sewage System Revenue Bonds, Series 2011, o •he qty.••• of Salina, Kansas, Dated April 15, 2011 •••••. We have acted as Bond Counsel in connection with the issuance by the City of Salida, Kansas (the "Issuer"), of the above-captioned bonds (the "Series 2011 Bonds"). In this capacity. we•fiave examined the law and the certified proceedings, certifications and other documents that we deem necessary to render this opinion. The Series 2011 Bonds have been authorized pursuant to an Ordinance and Resolution adopted by `I the governing body of the Issuer (collectively, the "Bond Resolution"). Capitalized terms used and not otherwise defined in this opinion shall have the meanings assigned to those terms in the Bond Resolution. - Regarding questions of fact material to our opinion, we have relied on the certified proceedings and other certifications of public officials and others furnished to us without undertaking to verify them • by independent investigation. Based upon the foregoing, we are of the opinion, under existing law, as follows: 1. The Issuer is a city of the first class with power to adopt the Bond Resolution, perform the agreements on its part contained therein, and issue the Series 2011 Bonds. 2. The Series 2011 Bonds have been duly authorized, executed and delivered by the Issuer and are valid and legally binding special obligations of the Issuer. 3. The Series 2011 Bonds are payable solely from the Net Revenues derived by the Issuer from the operation of the System. The Series 2011 Bonds do not constitute general obligations of the Issuer i and do not constitute an indebtedness of the Issuer within the meaning of any constitutional or statutory 7 • • B11162 2020 9'` � _ provision, limitation or restriction. The taxing power of the Issuer is not pledged to the payment of the Series 2011 Bonds. 4. The Bond Resolution has been duly adopted by the Issuer and constitutes a valid and legally binding obligation of the Issuer enforceable against the Issuer. The Bond Resolution creates a valid lien on the Net Revenues and other funds pledged by the Bond Resolution for the security of the Series 2011 Bonds on a parity with any Parity Bonds issued or to be issued, as provided in the Bond Resolution. 5. The interest on the Series 2011 Bonds (including any original issue discount properly allocable to an owner of a Series 2011 Bond) is excluded from gross income for federal income tax purposes. Interest on the Series 2011 Bonds is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations but is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on certain corporations. The opinions set forth in this paragraph are subject to the condition that the Issuer comply with all requirements of the Internal Revenue Code. of 1986, as amended (the "Code"), that must be satisfied subsequent to the issuance of the Series 2011 Bonds in order to preserve the exclusion of the interest on the Series 2011 Bonds from gross income for federal income tax purposes. The•Issuer has covenanted to comply with all of these requirements. Failure to comply with certain•bf'these requirements may cause interest on the Series 2011 Bonds to be included in gross income foi•federal income tax purposes retroactive to the date of issuance of the Series 2011 Bonds. Tftt: Series 20.11,$onds •• have not been designated as "qualified tax-exempt obligations" for purposes of Section 265i14}of the • Code. We express no opinion regarding other federal tax consequences arising with respect tvI}�e��S�ries 2011 Bonds. •••• • . . • • •••• 6. The interest on the Series 2011 Bonds is excluded from computation of KansaS2flfdsted gross income. •••• .••• We express no opinion regarding the accuracy, completeness or sufficiency of the Official Statement or other offering material relating to the Series 2011 Bonds (except to the extent, if any, stated in the Official Statement). Further, we express no opinion regarding the perfection or priority of the lien on the Net Revenues or other funds pledged under the Bond Resolution or tax consequences arising with respect to the Series 2011 Bonds other than as expressly set forth in this opinion. The rights of the owners of the Series 2011 Bonds and the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights generally and by equitable principles, whether considered at law or in equity. This opinion is given as of its date, and we assume no obligation to revise or supplement this opinion to reflect any facts or circumstances that may come to our attention or any changes in law that may occur after the date of this opinion. GILMORE & BELL, P.C. 8