86-9137 IRB Omaha HotelPu.b11sv)ed in -t tv aXr,a_Ja.jmd.J J..Lne 24, Mo
ORDINANCE NO. 86-9137
AN ORDINANCE RELATING TO $5,800,000 ECONOMIC
DEVELOPMENT REVENUE BOND (OMAHA HOTEL, INC. PROJECT);
AUTHORIZING THE ISSUANCE THEREOF PURSUANT TO K.S.A.,
SECTION 12-1749 ET SEQ., AND APPROVING AND AUTHORIZING
THE EXECUTION OF DOCUMENTS IN CONNECTION THEREWITH
BE IT ORDAINED by the governing body of the City of
alina, Kansas:
Section 1. Definitions
1.01. In this Ordinance the following terms, when
sed with initial capital letters, have the following
espective meanings unless the context hereof or use herein
learly requires otherwise:
Act: the Kansas Economic Development Revenue Bond
Act, K.S.A., Section 12-1749, et seq.;
Assignment: the Assignment of Rents, Leases and Other
Benefits to be given by the Tenant in favor of the Lender;
Bond: the $5,800,000 Economic Development Revenue
Bond (Omaha Hotel, Inc. Project) to be issued by the City
pursuant to this Ordinance;
Building: the three-story hotel facility to be
constructed by the Tenant on the Land and to be located at
1600 West Crawford in the City;
City: the City of Salina, Kansas, its successors and
assigns;
Code: the Internal Revenue Code of 1954, as amended;
Escrow Agent: FirsTier Bank, N.A., Omaha, a national
banking association, its successors and assigns;
Escrow Agreement: the Escrow and Disbursing Agreement
to be entered into between the City, the Tenant, the Escrow
Agent and the Lender;
Holder: the registered Holder of the Bond;
Land: the real estate described in Exhibit A to the
Lease Agreement;
Lease Agreement: the Lease Agreement to be executed
by the City and the Tenant;
Lender: Unionmutual Stock Life Insurance Co. of
America, a Maine corporation, its successors and assigns;
Mortgage: the Leasehold Mortgage and Security
Agreement to be given by the Tenant in favor of the Lender;
Ordinance: this ordinance of the City Commission
adopted June 23, 1986, authorizing the issuance of the Bond;
Pledge Agreement: the Pledge Agreement to be given by
the City in favor of the Lender;
Project: the acquisition of the Land and the
acquisition, construction and equipping of the Building;
Project Costs: the costs of the Project and the costs
of the issuance and delivery of the Bond as defined in the
Lease Agreement;
Tenant: Omaha Hotel, Inc., a Kansas corporation, its
(b) an information statement has been filed with the
State Board of Tax Appeals as required by Section 12-1744a
of the Act at least seven days prior to the proposed
delivery date of the Bond and the Chairperson of the Board
of Tax Appeals has found, or will, prior to the delivery of
the Bond, find, that the information and documents
submitted are complete and timely filed;
successors and assigns; and
it is desirable that the Bond in
the amount of
Title Company: Ticor Title Insurance Company.
$5,800,000
Section 2. Findings. It is hereby found, determined
terms set forth
nd declared that:
herein and
that the City pledge and grant
(a) the financing of the Project, the authorization
of the Bond in the principal amount of $5,800,000, the
execution and delivery of the Lease Agreement, the Escrow
Agreement and the Pledge Agreement and the performance of
all covenants and agreements of the City contained in the
Lease Agreement, the Escrow Agreement and the Pledge
Agreement and of all other acts and things required under
the Constitution and laws of the State of Kansas to make
the Lease Agreement, the Escrow Agreement, the Pledge
Agreement and the Bond valid and binding obligations in
accordance with their terms, are authorized by the Act;
(b) an information statement has been filed with the
State Board of Tax Appeals as required by Section 12-1744a
of the Act at least seven days prior to the proposed
delivery date of the Bond and the Chairperson of the Board
of Tax Appeals has found, or will, prior to the delivery of
the Bond, find, that the information and documents
submitted are complete and timely filed;
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(c)
it is desirable that the Bond in
the amount of
$5,800,000
be issued by the City upon the
terms set forth
herein and
that the City pledge and grant
to the Lender a
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security interest in certain revenues and payments to be
received by the City under the Lease Agreement as security
for the payment of the principal of, premium, if any, and
interest on the Bond;
(d) the payments contained in the Lease Agreement are
fixed, and are required to be revised from time to time as
necessary, so as to produce income and revenue sufficient
to provide for prompt payment of principal of, premium, if
any, and interest on the Bond when due; and the Lease
Agreement also provides that the Tenant is required to pay
all expenses of the operation and maintenance of the
Project, including, but without limitation, adequate
insurance thereon and insurance against all liability for
injury to persons or property arising from the operation
thereof, and all taxes and special assessments levied upon
or with respect to the Land and payable during the term of
the Lease Agreement;
(e) the execution and delivery of the Lease
Agreement, the Escrow Agreement, the Pledge Agreement and
the Bond will not conflict with, or constitute on the part
of the City a breach of or a default under, any existing
agreement, indenture, mortgage, lease or other instrument
to which the City is subject or is a party or by which it
is bound;
(f) no litigation is pending or, to the best
knowledge of the members of this Commission, threatened
against the City questioning the organization or boundaries
of the City or the right of any officer of the City to hold
his or her office, or in any manner questioning the right
and power of the City to execute and deliver the Bond, or
otherwise questioning the validity of the Bond or the
execution, delivery or validity of the Lease Agreement, the
Escrow Agreement or the Pledge Agreement or questioning the
appropriation of revenues to payment of the Bond or the
right of the City to acquire and construct the Project and
lease it to the Borrower;
(g) all acts and things required under the
Constitution and the laws of the State of Kansas to make
the Lease Agreement, the Escrow Agreement, the Pledge
Agreement and the Bond the valid and binding obligations of
the City in accordance with their terms will have been done
upon adoption of this Ordinance and execution of the Lease
Agreement, the Escrow Agreement and the Pledge Agreement;
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(h)
the City is duly
organized and validly
existing
under the
Constitution and
laws of the State of
Kansas and
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is authorized to issue the Bond in accordance with the Act;
and
(i) pursuant to Executive Orders 84-77, 84-78 and
86-85, the State Department of Economic Development has
allocated to the City $6,000,000 of authority to issue
private activity bonds under Section 103(n) of the Code and
H.R. 3838.
Section 3. Authorization and Sale
3.01. Authorization. The City is authorized by the
ct to issue revenue bonds and to use the proceeds thereof to
cquire and construct facilities such as the Project and to
ease such facilities to entities such as the Tenant.
3.02. Preliminary City Approval. The Commission gave
reliminary approval to the sale of its revenue bonds pursuant
o the Act, the use of the proceeds for the acquisition and
mprovement of the Project and the lease of the Project to the
enant and authorized the preparation of such documents as may
e appropriate to the Project by adoption of Resolution No.
5-3765, on March 4, 1985.
3.03. Documentation. There have been prepared and
resented to this Commission copies of the following documents,
ll of which are now, or shall be, placed on file in the office
f the City Clerk:
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(a) the Lease Agreement;
(b) the Pledge Agreement;
(c) the Escrow Agreement;
(d) the Mortgage; and
(e) the Assignment;
Section 4. Approval of Documents. The forms of the
ease Agreement, Escrow Agreement and Pledge Agreement referred
o in Section 3.03 are approved subject to such modifications
s are deemed appropriate and approved by the attorney for the
City and by the Mayor, which approval shall be conclusively
evidenced by execution of the Lease Agreement, the Escrow
greement, the Pledge Agreement and the Bond by the Mayor and
he City Clerk. The Mayor and City Clerk are directed to
xecute the Lease Agreement and the Escrow Agreement upon
xecution thereof by the Tenant and to execute the Pledge
greement. Copies of all of the documents shall be delivered,
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fled and recorded as provided therein. The Mayor and the City
Jerk are also authorized and directed to execute such other
instruments as may be required to give effect to the
ransactions herein contemplated.
Section 5. The Bond.
5.01. Form. The Bond shall be issued substantially
n the form set forth in Exhibit A hereto, with such
ppropriate variations, omissions and insertions as are
ermitted or required by this Ordinance, and in accordance with
he further provisions of this Section 5.
5.02. Bond Terms. The Bond shall be designated the
conomic Development Revenue Bond (Omaha Hotel, Inc. Project),
nd shall:
(a) be dated as of the date of delivery thereof to
the Lender;
(b) be in the total principal amount of $5,800,000;
(c) bear interest initially at the rate of 10-3/80
per annum, subject to adjustment at the times and in the
manner set forth in the form of the Bond contained in
Exhibit A hereto;
(d) be payable in monthly installments of principal
and interest initially in the amount of $52,513.61, subject
to adjustment at the times and in the manner set forth in
the form of the Bond contained in Exhibit A hereto;
(e) mature finally on July 1, 2001; and
(f) be subject to redemption and prepayment upon the
terms and subject to the conditions provided in the form of
the Bond provided in Exhibit A hereto.
5.03. Execution. The Bond shall be executed on
ehalf of the City by the signatures of the Mayor and the City
lerk, and shall be sealed with the corporate seal of the
ity. In case any officer whose signature shall appear on the
and shall cease to be such officer before the delivery
hereof, such signature shall nevertheless be valid and
ufficient for all purposes.
5.04. Mutilated, Lost and Destroyed Bond. In case
he Bond shall become mutilated or be destroyed or lost, the
ity shall cause a new Bond to be executed and delivered of
ike outstanding principal amount and tenor in exchange and
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ubstitution for and upon cancellation of the mutilated Bond,
r in lieu of and in substitution for such Bond destroyed or
ost, pursuant to procedures and requirements as the City shall
eem proper and sufficient fully to protect itself, including
he posting by the Holder of an indemnity bond in form,
ubstance and amount satisfactory to the attorney for the City
nd the Holder's paying the expenses and charges of the City in
onnection with such substitution and replacement, and, in case
he Bond is destroyed or lost, its filing with the City
vidence satisfactory to it of compliance with any applicable
rovisions of law.
5.05. Registration of Transfer. The City will cause
o be kept at the office of the City Clerk a Bond Register in
which, subject to such reasonable regulations as it may
rescribe, the City shall provide for the registration or
transfer of ownership of the Bond. The Bond shall be
ransferable upon the books of the City by the Holder thereof
n person or by its attorney duly authorized in writing, upon
urrender of the Bond together with a written instrument of
ransfer satisfactory to the City Clerk, duly executed by the
older thereof or its duly authorized attorney, and upon
ayment by the Holder of any expenses of the City incurred by
t in connection with such transfer. Upon such transfer the
ity Clerk shall note the date of registration and the name and
ddress of the new Holder on the books of the City and in the
egistration blank appearing on the Bond. Alternatively, the
ity shall, at the request and expense of the Holder, issue a
ew bond or bonds, in aggregate outstanding principal amount
qual to that of the Bond surrendered, and of like tenor except
s* to number, principal amount and the amount of the monthly
nstallments payable thereunder, and registered in the name of
he Holder or such transferee as may be designated by the
older. The City may deem and treat the person in whose name
he Bond is last registered upon the books of the City with
uch registration noted on the Bond, as the absolute owner
hereof, whether or not overdue, for the purpose of receiving
ayment of or on account of the principal balance, prepayment
rice or interest and for all other purposes, and all such
ayments so made to the Holder or upon its order shall be valid
nd effectual to satisfy and discharge the liability upon the
and to the extent of the sum or sums so paid, and the City
hall not be affected by any notice to the contrary.
5.06. Delivery and Use of Proceeds. Prior to
elivery of the Bond, the documents referred to below shall be
ompleted and executed in form and substance as approved by the
ttorney for the City. The City shall execute and deliver the
and to the Lender together with the following:
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(a) a duly certified copy of this Ordinance;
(b) original, executed counterparts of the Lease
Agreement, the Escrow Agreement and the Pledge Agreement;
and
(c) such closing certificates, opinions and related
documents as are required by the Lender or by Dorsey &
Whitney, as bond counsel, and which are approved by the
attorney for the City.
Upon delivery of the Bond and the above items to the
ender, the Lender shall pay the purchase price of the Bond
which purchase price shall be in an amount equal to the
rincipal amount of the Bond) to the Escrow Agent, on behalf of
he City, and the Tenant shall pay to the City an amount equal
o the expenses incurred by the City in connection with the
ssuance of the Bond, as shown by a statement to be delivered
o the Tenant by the City. The Escrow Agent shall deliver to
he City and the Lender a receipt for such purchase price,
hall hold the proceeds of the Bond in accordance with the
scrow Agreement and shall disburse such proceeds to the Tenant
n reimbursement of expenditures made by the Escrow Agent for
roject Costs. The Escrow Agent shall provide the City with a
ull accounting of all funds disbursed for Project Costs.
Section 6. Waiver of Tax Exemption. The Bond is
ssued under the condition that the Lease Agreement will
rovide that the Tenant will waive any ad valorem property tax
xemption which would otherwise be available to the Project
nder the provisions of K.S.A., Section 79-201(a) Second.
Section 7. Conveyance of Project. Upon receipt by
he City of the purchase price of the Project, computed in
ccordance with Section 2.12 of the Lease Agreement, title to
he Project shall be transferred and conveyed to the Tenant as
rovided in the Lease Agreement, and the Mayor and City Clerk
re hereby authorized and directed to execute such deeds, bills
f sale and other instruments as may be necessary to effect
uch conveyance and transfer in accordance with the provisions
f Section 2.12 of the Lease Agreement.
Section 8. Limitations of the City's Obligations.
Notwithstanding anything contained in the Bond, the Lease
greement, the Escrow Agreement, the Pledge Agreement or any
ther documents referred to in Section 3.03, the Bond shall not
onstitute a debt of the City within the meaning of any
onstitutional or statutory limitation, and shall not be
payable from nor charged upon any funds other than the revenues
ledged to the payment thereof, and no Holder of the Bond shall
ver have the right to compel any exercise of the taxing power
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f the City to pay the Bond or the premium, if any, or interest
hereon, or to enforce payment thereof against any property of
he City other than those rights and interests of the City
nder the Lease Agreement which have been pledged to the
ayment thereof, and the Bond shall not constitute a charge,
ien or encumbrance, legal or equitable, upon any property of
he City other than those rights and interests of the City
nder the Lease Agreement which have been pledged to the
ayment thereof. The principal of and interest on the Bond
hall be payable solely and only from the revenues pledged to
he payment thereof and the Bond shall not in any respect be a
eneral obligation of the City nor shall it be payable in any
anner by taxation. The agreement of the City to perform the
ovenants and other provisions contained in this resolution or
he Bond, the Lease Agreement, the Escrow Agreement or the
ledge Agreement and the other documents listed in Section 3.03
hall be subject at all times to the availability of the
evenues furnished by the Tenant sufficient to pay all costs of
uch performance or the enforcement thereof, and the City shall
of be subject to any personal or pecuniary liability thereon
ther than as stated above.
Section 9. Election. Pursuant to Treasury
egulations, Section 1.103-10(b)(2)(vi), the City hereby elects
hat the provisions of Section 103(b)(6)(D) of the Code apply
o the Bond.
Section
10. Effective Date
ake effect and be in force
ublication in the official
from and
newspaper
This Ordinance shall
after its passage and
of the City.
PASSED AND APPROVED by the governing body of the City
Salina, Kansas this 23rd day of June, 1986.
Mayor
Wlict
ttest: -t
City Clerk
EXHIBIT "A"
UNITED STATES OF AMERICA
STATE OF KANSAS
COUNTY OF SALINE
CITY OF SALINA
Economic Development Revenue Bond
(Omaha Hotel, Inc. Project)
$5,800,000.00
June 25, 1986
1. FOR VALUE RECEIVED, the CITY OF SALINA, KANSAS, a
unicipal corporation under the laws of the State of Kansas
hereinafter called "Issuer"), promises to pay, but solely from
he sources and as hereinafter provided, to Unionmutual Stock
Life Insurance Co. of America, a Maine corporation, or
egistered assigns (hereinafter called "Holder"), at 2211
ongress Street, Portland, Maine 04122, or at such other place
s Holder may designate in writing, the principal sum of Five
Million Eight Hundred Thousand Dollars (US $5,800,000.00),
ogether with interest on the unpaid principal balance from the
ate hereof as hereinafter specified.
2. From and after the date hereof, interest, computed
n the basis of the actual number of days elapsed in a 365 -day
-ear, shall be payable at the rate of ten and three-eighths
ercent (10-3/8%) per annum. Interest only from the date
ereof through the last day of June, 1986 shall be payable on
he first day of July, 1986; provided, however, that if this
and is dated on or after June 15, 1986, the interest which
ould accrue through June 30, 1986 shall be payable in advance'
n the date hereof. Thereafter, the unpaid principal and
nterest shall be due and payable, computed on the basis of an
mortization period of 360 months (hereinafter called the
Amortization Period"), in 180 monthly payments of Fifty-two
housand Five Hundred Thirteen and 61/100 Dollars (US
52,513.61) each, on the first day of each month beginning on
he first day of August, 1986. Such monthly payments shall
ontinue until all obligations of Issuer hereunder have been
aid in full; except that, in any event, all obligations of
ssuer hereunder shall be fully paid, and all remaining
rincipal and accrued interest shall be due and payable on
my 1, 2001 (hereinafter called the "Maturity Date").
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3. Holder shall have the unilateral right, at its
ption, to increase the interest.rate of this Bond as of
my 1, 1991 and July 1, 1996, up to the Index Rate (as
ereinafter defined), as determined by Holder as of April 1,
991 and April 1, 1996, respectively (hereinafter referred to
s the "Determination Dates"). Holder shall give Issuer and
enant (as hereinafter defined) written notice of any such
ncrease in the interest rate on this Bond within ten (10) days
fter each Determination Date. Also, as more fully provided in
ection 1.11 of the Leasehold Mortgage and Security Agreement
ereinafter referred to, Holder's consent to certain sales,
ssignments, encumbrances or other dispositions of title to the
ortgaged property, or to certain transfers of ownership
nterests in Tenant, may be required, and in such cases where
older's consent is required, Holder may condition its consent
pon an increase in the interest rate on this Bond up to the
ndex Rate. Upon and after any such change in interest rate,
he amount of each monthly payment hereunder shall be increased
o an amount sufficient to amortize the then unpaid principal
alance of this Bond in equal monthly payments over the
emainder of the Amortization Period. Index Rate shall mean,
rior to a Determination of Taxability (as hereinafter
efined), the rate of interest per annum equal to 110% of the
verage of the Bond Buyer Revenue Bond Index as published
eekly in The Bond Buyer and, after a Determination of
axability, the rate of interest per annum equal to 120% of the
verage of Moody's corporate bond yield average for Aa
ndustrial Bonds as published monthly in "Moody's Bond Record",
oth for the three months prior to the Determination Date, or,
n the case of an increase in the interest rate on this Bond
mposed as a condition to Holder's consent to certain actions
eferred to above, the date on which written notice of such
ncrease is given by Holder to Issuer and to Tenant (or, if
ither of such indices is no longer published, a similar or
omparable index selected by Holder). In the case of an
ncrease in the interest rate on this Bond as provided in this
aragraph 3, during the three (3) month period following
ssuer's and Tenant's receipt of notice of any such increase in
nterest rate, Issuer shall have the right to prepay this Bond
n full without prepayment premium. The provisions of this
aragraph shall be self-executing without the need for any
odification or amendment to this Bond; provided, however,
older may, at its sole option, require that Issuer and/or
enant execute or provide documents confirming any adjustment
n the interest rate, including without limiting the generality
f the foregoing, at the expense of Tenant, endorsements to the
itle insurance policy and/or opinions of counsel satisfactory
o Holder.
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4. At the option of Holder exercisable at any time
(luring the term of this Bond, payments due under this Bond may
e required to be paid by wire transfer or other immediately
available funds satisfactory to Holder.
5. If any payment under this Bond is not paid by the
ifth (5th) day of the calendar month, then Issuer shall pay to
older a late charge of five percent (5%) of such payment. If
ny payment under this Bond is not paid by the fifteenth (15th)
ay of the calendar month, then the entire principal balance of
his Bond shall bear interest from the due date of such late
ayment until such late payment is paid at a rate of five
ercent (5%) per annum in excess of the interest rate then
pplicable hereunder. The late charge and excess interest
hall be due and payable immediately upon demand.
6. Issuer shall not have any right, except as
therwise specifically provided, to prepay all or any portion
f the principal balance of this Bond.
7. In the event the principal of this Bond is
ccelerated after default, an acceleration premium shall be due
nd owing and payable in respect thereof in an amount equal to
he greater of (a) ten percent (10%) of the principal sum
ereof outstanding on the date of such acceleration, or (b) an
mount necessary to ensure Holder an internal rate of return on
uch principal sum equal to the current interest rate on this
and at the time of acceleration, assuming the total amount
eceived by Holder is invested in AAA municipal bonds selected
y Holder and maturing at or near the Maturity Date.
8. Notwithstanding the foregoing, upon six (6)
onths' written notice to Issuer, Holder shall, at its sole
ption, have the right to call for payment in full of the
rincipal balance of this Bond plus accrued interest, with no
repayment premium, on July 1, 1996. Under no circumstances
hall this paragraph be construed to make this Bond one which
s payable on demand except after such demand has been made and
uch six (6) months' notice period has expired.
9. If Holder receives notice of a Determination of
axability (as hereinafter defined), then the rate of interest
hen payable under this Bond shall automatically be increased
y two and one-half percent (2-1/2%) per annum (but in any
vent to a rate not less than 12-7/8% per annum), effective as
f the date of receipt by Holder of such notice, and the
monthly payments required hereunder shall be increased,
affective as of the first day of the calendar month following
such date of receipt, to an amount sufficient to amortize the
hen unpaid principal balance of this Bond, together with
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nterest as increased in accordance with the provisions of this
aragraph, in equal monthly payments over the remainder of the
mortization Period. As soon as practicable after its receipt
f notice of a Determination of Taxability, Holder shall notify
n writing Issuer and Tenant of its receipt thereof and of the
onsequent increase in interest rate and monthly payments
equired hereunder. In addition, Holder may, at its option, at
ny time after receipt of notice of a Determination of
axability (other than a Determination of Taxability caused by
change in law or regulation), declare the unpaid principal
alance of this Bond, together with accrued interest thereon
nd any other indebtedness due hereunder, due and payable in
ull, upon at least six (6) months' prior written notice to
ssuer and Tenant, and Issuer shall pay the same to Holder on
he date specified in said notice, plus a prepayment premium
qual to ten and three-eighths percent (10-3/8%) of such unpaid
rincipal balance. In addition to the other amounts set forth
n this paragraph and within thirty (30) days of receipt of a
otice setting forth such amounts, Issuer shall pay to the
urrent and any previous Holder of this Bond the amounts of
dditional federal, state and local income taxes, including
enalties and interest thereon, which such Holder or Holders
stimate they will incur by reason of such Determination of
axability with respect to their current and past tax years,
lus a "gross up" amount equal to all federal, state and local
axes required to be paid by virtue of the receipt of payments
nder this sentence (calculated at an assumed federal tax rate
f 46% and at the maximum state and local statutory rates
pplicable to the recipient), and the provisions of this
entence shall survive the payment of this Bond. If the
etermination of Taxability is due to an act or omission of
enant, the obligation set forth in the immediately preceding
entence shall constitute a personal liability of Tenant.
10. A "Determination of Taxability" shall mean a
etermination by the Internal Revenue Service or an opinion of
ationally recognized bond counsel selected by Holder that the
nterest payable on this Bond is includible in whole or in part
or federal income tax purposes in the gross income of Holder
other than a Holder who is a "substantial user" of the Project
r a "related person", within the meaning of Section 103(b)(13)
f the Internal Revenue Code of 1954, as amended), or a
tatement of such counsel that it is unable to give an opinion
hat the interest payable on this Bond continues to be
xcludable for federal income tax purposes from the gross
ncome of Holder (other than a Holder who is a "substantial
ser" of the Project or a "related person", within the meaning
f Section 103(b)(13) of the Internal Revenue Code of 1954, as
mended).
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11. This Bond is issued pursuant to and in full
ompliance with the provisions, restrictions and limitations of
he Constitution and laws of the State of Kansas, including
ansas Statutes Annotated, Sections 12-1740 et seg., as
ended, and Ordinance No.86-9137 adopted by the Board of City
ommissioners of the Issuer on June 23, 1986 (hereinafter
alled the "Ordinance"), and is issued by Issuer for the
urpose of providing funds to be used to pay the cost of
cquiring land and improvements (herein called the "Project")
o be leased to Omaha Hotel, Inc., a Kansas corporation (herein
alled the "Tenant") pursuant to the terms of a Lease Agreement
f even date (hereinafter called the "Lease Agreement"). As
ecurity for this Bond, Issuer has pledged to Holder certain of
is rights under the Lease Agreement pursuant to a Pledge
greement, Issuer, Tenant, FirsTier Bank, N.A., Omaha and
older have entered into an Escrow and Disbursing Agreement,
nd Tenant has given Holder a Leasehold Mortgage and Security
greement pertaining to its leasehold interest in and to the
roject and such other security as may have been agreed by
enant and Holder, and Tenant has also given to Holder in
onnection herewith an Assignment of Rents, Leases, and Other
enefits with respect to the Project and a Deed of Trust,
ssignment of Rents, Security Agreement and Fixture Financing
tatement and an Assignment of Rents, Leases and Other Benefits
ith respect to certain property in Douglas County, Nebraska
all such documents and all other documentation pertaining
reto are hereinafter called the "Bond Documents").
12. This Bond and the interest and any premium
hereon, or any amount payable hereunder, however designated,
re payable by Issuer solely from the money and revenue
received from the fees charged and rental received for the use
f the Project pursuant to the Lease Agreement, do not
nstitute a debt of Issuer within the meaning of any
constitutional or statutory limitation, are not payable from or
charge upon any funds of Issuer other than the revenues and
roceeds pledged by Issuer to payment thereof, and do not give
ise to a pecuniary liability of Issuer nor of any of its
fficers, agents, or employees, and no holder of this Bond
all ever have the right to compel any exercise of the taxing
rower of Issuer to pay this Bond or the interest or any premium
reon, or any amounts payable hereunder, however designated,
r to enforce payment thereof against any property of Issuer,
cept the revenues from the Project specifically pledged to
e payment thereof. This Bond and the interest payable
reunder, and premium hereon, or any amount payable hereunder,
Wever designated, do not constitute a charge, lien, or
cumbrance, legal or equitable, upon any property of Issuer,
cept the revenues from the Project specifically pledged to
e payment thereof, and the agreement of Issuer to perform or
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ause the performance of the covenants and other provisions
erein referred to shall be subject at all times to the
vailability of revenues or other funds furnished for such
,urpose in accordance with the Lease Agreement, sufficient to
ay all costs of such performance or the enforcement thereof.
he provisions of this paragraph shall, for purposes of this
ond, be controlling and shall be given full force and effect,
nything else to the contrary in this Bond notwithstanding.
13. It is agreed that time is of the essence in the
erformance of all obligations hereunder and under the Bond
ocuments. If Issuer or Tenant shall fail to make any payment
ereunder when due, or if Issuer or Tenant shall default in the
erformance or observance of any of the terms, agreements,
ovenants or conditions contained in the Bond Documents, then,
r at any time thereafter, the entire principal balance of this
ond, irrespective of the Maturity Date specified herein,
ogether with the then accrued interest thereon, and to the
xtent permitted by law, the acceleration premium, shall, at
he election of the Holder hereof, and without notice of such
lection, become immediately due and payable and the entire
rincipal balance with accrued interest thereon shall
hereafter until paid bear interest at a rate of five percent
5%) in excess of the interest rate then applicable hereunder.
14. All makers, endorsers, guarantors and sureties
ereof jointly and severally waive presentment, protest, notice
f dishonor, and notice of intent to accelerate; and they also
iointly and severally hereby consent to any and all renewals,
xtensions or modifications of the terms hereof, including the
erms or time for payment; and further agree that any such
enewal, extension or modification of the terms hereof or time
or payment or of the terms of any of the Bond Documents or the
elease or substitution of any security for the indebtedness
videnced hereby or any other indulgences shall not otherwise
ffect the liability of any of said parties for the
ndebtedness evidenced by this Bond. Any such renewals,
xtensions or modifications may be made without notice to any
f said parties.
15. This Bond shall be the joint and several
bligation of all makers, endorsers, guarantors, and sureties,
nd shall be binding upon them and their successors and
ssigns; and shall inure to the benefit of the successors and
ssigns of Holder. All makers, endorsers, guarantors, and
ureties hereof agree jointly and severally to pay all costs of
ollection and of suit and foreclosure, including reasonable
ttorneys' fees.
a M.
16. Any forbearance of Holder in exercising any right
or remedy hereunder or under the Bond Documents, or otherwise
afforded by applicable law, shall not be a waiver of or
pr clude the exercise of any right or remedy. The acceptance
by Holder of payment of any sum payable hereunder after the due
da -:e of such payment shall not be a waiver of Holder's right
ei her to require prompt payment when due of all other sums
payable hereunder or to declare a default for failure to make
pr mpt payment.
17. This Bond shall be governed by the laws of the
St to of Kansas except to the extent that federal law may
pr empt it.
-7-
18. All agreements between Issuer and Holder are
ex
ressly limited so that in no event whatsoever shall the
amount
paid or agreed to be paid to Holder for the use,
forbearance
or detention of the money to be advanced hereunder
in
accordance with the Bond Documents exceed the highest lawful
rale
permissible under applicable law, it being the intent of
Holder
and Issuer in the execution hereof and of the Bond
Doduments
to contract in strict accordance with applicable
usury
laws. If any obligation under this Bond or under any
Bond
Document shall involve transcending the usury limit
pr
scribed by applicable law, then ipso facto the obligation to
be
fulfilled shall be reduced to such limit, and if from any
circumstance
Holder shall receive as interest an amount which
would
exceed the highest lawful rate allowable under applicable
law,
such amount which would be excessive interest shall be
applied
to the reduction of the unpaid principal balance due
he
under, without premium or penalty, and not to the payment
of
interest, or if such excessive interest exceeds the unpaid
principal
balance, the excess shall be refunded to Issuer.
This
provision shall control every other provision of all
agi
ements between Issuer and Holder.
19. As provided in the Ordinance, Issuer will cause
to
be kept at the office of its Clerk a Bond Register in which,
sukject
to such reasonable regulations as it may prescribe,
IsE
er shall provide for the registration or transfer of
owr,arship
of this Bond. This Bond is transferable upon the
bocr,s
of Issuer at the office of its Clerk, by Holder in person
or
Dy its attorney duly authorized in writing, upon surrender
he
of together with a written instrument of transfer
sat
.sfactory to the Clerk, duly executed by Holder or its duly
aut,iorized
attorney, and upon payment by the Holder of any
ex1anses
of Issuer incurred by it in connection with such
tr.
sfer. Upon such transfer the Clerk will note the date of
re
th
'stration and the name and address of the new Holder upon
books of Issuer and in the registration blank appearing
be
w. Alternatively, Issuer will, at the request of Holder,
-7-
IN WITNESS WHEREOF, Issuer has caused this Bond to be
duexecuted by its duly authorized officers and its corporate
se 1 to be affixed hereto, all as of this 25th day of June,
19t6.
T:
It4j City Cler
(S
CITY OF SALINA, KANSAS
By
is Mayor
WE
issue
a new bond or bonds in an aggregate principal amount
equal
to the unpaid principal balance of this Bond, and of like
tenor
except as to number, principal amount and the amount of
thd
monthly installments payable thereunder, and registered in
thd
name of Holder or such transferee as may be designated by
Ho
der. Issuer may deem and treat the person in whose name
th
s Bond is last registered upon the books of Issuer with such
re
istration noted on this Bond as the absolute owner hereof,
wh
ther or not overdue, for the purpose of receiving payment of
or
on account of the principal balance, redemption price or
in
erest and for all other purposes, and all such payments so
mace
to Holder or upon its order shall be valid and effectual
to
satisfy and discharge the liability upon this Bond to the
extent
of the sum or sums so paid, and Issuer shall not be
affected
by any notice to the contrary.
20. It is hereby certified and recited that all
coilditions,
acts and things required to exist, to happen and to
be
performed precedent to or in the issuance of this Bond do
exist,
have happened and have been performed in regular and due
form,
time and manner as required by law.
under
21. This Bond has been issued without registration
state or federal or other securities laws, pursuant to an
exemption
for such issuance; and accordingly this Bond may not
be
assigned or transferred in whole or part, nor may a
participation
interest in this Bond be given pursuant to any
pa
ticipation agreement, except in accordance with an
ap
licable exemption from such registration requirements or
con
liance with such securities laws.
IN WITNESS WHEREOF, Issuer has caused this Bond to be
duexecuted by its duly authorized officers and its corporate
se 1 to be affixed hereto, all as of this 25th day of June,
19t6.
T:
It4j City Cler
(S
CITY OF SALINA, KANSAS
By
is Mayor
WE
PROVISIONS AS TO REGISTRATION
The ownership of this Bond is registered on the hooks
f the Issuer in the name of the registered holder last noted
elow.
ate of Name and Address of
gistration Registered Holder Signature of Clerk
June 25, 1986 Unionmutual Stock Life
Insurance Co. of
America
2211 Congress Street
Portland, Maine 04122