8709 IRB Salina NursingFinal Draft
ORDINANCE NO. 8709
o f the
CITY OF SALINA, KANSAS
Authorizing the Issuance of
$1,400,000.00
City of Salina, Kansas
Salina Nursing Center, Inc., Industrial Revenue Bonds
Series of 1979
DATED AS OF APRIL 1, 1979
(Published in `�Ot.urnu-I
ORDINANCE NO. ?70'7-
' � 2- , 19 7 9 )
AN ORDINANCE AUTHORIZING THE CITY OF SALINA,
KANSAS, TO ACQUIRE THE REAL PROPERTY HEREINAFTER
DESCRIBED AND TO ACQUIRE, PURCHASE, CONSTRUCT AND
EQUIP A 100 -BED NURSING HOME FACILITY LOCATED AND
TO BE LOCATED THEREON TO BE LEASED TO SALINA
NURSING CENTER, INC., FOR COMMERCIAL PURPOSES;
AUTHORIZING AND DIRECTING THE ISSUANCE OF
$1,400,000 PRINCIPAL AMOUNT OF INDUSTRIAL REVENUE
BONDS, SALINA NURSING CENTER, INC., SERIES OF
1979, OF SAID CITY FOR THE PURPOSE OF PROVIDING
FUNDS TO PAY THE COST OF ACQUIRING, PURCHASING,
CONSTRUCTING AND EQUIPPING SAID NURSING HOME
FACILITY TO BE LEASED TO SALINA NURSING CENTER,
INC.; PRESCRIBING THE FORM AND AUTHORIZING THE
EXECUTION OF A LEASE BY AND BETWEEN SAID CITY AND
SALINA NURSING CENTER, INC.; AND PRESCRIBING THE
FORM AND REQUIRING THE EXECUTION OF A SEPARATE
GUARANTY AGREEMENT BY SALINA NURSING CENTER, INC.
AND BY JOE W. CARMICHAEL, JOSAILLE CARMICHAEL,
LEONARD E. STOLZ, ELIZABETH C. STOLZ, CLIFFORD K.
LEDOUX, ELLA L. LEDOUX, WILLIAM S. BRADLEY AND
BETTY K. BRADLEY, AS GUARANTORS.
WHEREAS, the City of Salina, Kansas, a city of the first class,
hereinafter sometimes referred to as the "City", desires to promote,
stimulate and develop the general economic welfare and prosperity of
the City of Salina, Kansas, and its environs and thereby to further
promote, stimulate and develop the general economic welfare and
prosperity of the State of Kansas; and
WHEREAS, pursuant to the provisions of K.S.A. 12-1740 to 12-1749a,
as amended (hereinafter referred to as the "Act"), said City is
authorized to issue Industrial Revenue Bonds of the City, and it is
hereby found and determined to be advisable and in the interest and
for the welfare of the City and its inhabitants that Industrial
Revenue Bonds of the City in the principal amount of $1,400,000 be
authorized and issued, for the purpose of providing funds to pay the
cost of acquiring the real property hereinafter described and of
purchasing, constructing and equipping thereon a 100 -bed nursing
home facility pursuant to the Act, and �s willing to lease the real
property hereinafter described together with the improvements located
and to be located thereon for said purposes, to Salina Nursing
Center, Inc., a Kansas corporation, hereinafter sometimes referred
to as "Tenant"; and
WHEREAS, Joe. W. Carmichael, JoSaille Carmichael, Leonard E.
Stolz, Elizabeth C. Stolz, Clifford K. LeDoux, Ella L. LeDoux,
William S. Bradley and Betty K. Bradley, directly or beneficially,
own all of the issued and outstanding capital stock of Tenant and
are willing, in order to induce the City to issue said Industrial
Revenue Bonds and enter into the other transactions contemplated
hereby, to enter into a separate Guaranty Agreement with respect to
said Industrial Revenue Bonds; and
WHEREAS, the City will acquire the real property hereinafter
described, together with the existing improvements located thereon
prior to or concurrently with the issuance of the Industrial Revenue
Bonds herein authorized; and
WHEREAS, the City and Tenant desire to reserve the right to
finance the purchase, construction and equipping of additional
buildings and improvements on said real property out of the proceeds
of other Industrial Revenue Bonds issued pursuant to the provisions
of this Ordinance or out of other funds obtained by the Tenant for
said purpose.
NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE
CITY OF SALINA, KANSAS:
SECTION 1: Authority to Acquire, Purchase, Construct and Equi
the Facility. The City of Salina, Kansas, is hereby authorized to
acquire the real property described in paragraph (a) of Schedule 1
attached to this Ordinance and made a part hereof, together with
such of the buildings, improvements, machinery and equipment de-
scribed in paragraph (b) of Schedule 1 as are complete and in place
at the time of said acquisition, and to purchase, construct, equip
and install the said buildings, improvements, machinery and equipment
described in paragraph (b) of Schedule 1, all of the property, both
real and personal, described in paragraphs (a) and (b) of Schedule I
being sometimes hereinafter referred to as the "Facility", in accord-
ance with the provisions contained herein and in the Lease dated as
of April 1, 1979, between said City and the Tenant, hereinafter
referred to as the "Lease", which Lease is authorized by Section 29
of this Ordinance, all at a cost to be paid by the City from the
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proceeds of the Industrial Revenue Bonds herein authorized not in
excess of $1,400,000.
SECTION 2. Authorization of and Security for the Bonds. For
the purpose of providing funds to pay the cost of acquiring, pur-
chasing, constructing and equipping the Facility, there shall be
issued and hereby are authorized and directed to be issued a series
of City of Salina, Salina Nursing Center, Inc., Industrial Revenue
Bonds, Series of 1979, of the City of Salina, Kansas, in the prin-
cipal amount of $1,400,000 (hereinafter sometimes referred to as the
"Bonds"). The Bonds and all interest thereon shall be paid solely
from the money and revenue received from the fees charged and rental
received for the use of the Facility and not from any other fund or
source (except to the extent paid out of the moneys attributable to
Bond proceeds or the income from the temporary investment thereof
and, under certain circumstances as hereinafter and in the Lease
provided, proceeds of insurance, sale and condemnation awards) and
the City hereby pledges the Facility and the net earnings therefrom
to the payment of the Bonds and the interest thereon.
SECTION 3. Description and Details of the Bonds, Designation
of Paying Agent. The Bonds shall be dated April 1, 1979, and each
of said Bonds shall be coupon bonds, numbered from 1 to 280, inclu-
sive. The Bonds shall be in denominations of $5,000.00 as set forth
below. Each of said Bonds shall become due serially on. April 1 in
each of the following years and shall bear interest from date at the
respective rates as follows:
SERIAL BONDS
BOND NUMBERS AMOUNT INTEREST RATE MATURITY DATE
1 - 6, incl. $30,000 7.25% April 1, 1984
7 14, incl. 40,000 7.30% April 1, 1985
15 - 22, incl. 40,000 7.40% April 1, 1986
23 - 30, incl. 40,000 7.50% April 1, 1987
31 - 40, incl. 50,000 7.75% April 1, 1988
41 - 50, incl. 50,000 8.00% April 1, 1989
51 - 60, incl. 50,000 8.10% April 1, 1990
61 - 70, incl. 50,000 8.20% April 1, 1991
71 - 80, incl. 50,000 8.20% April 1, 1992
81 - 92, incl. 60,000 8.40% April 1, 1993
93 - 106, incl. 70,000 8.50% April 1, 1994
107 - 122, incl. 80,000 8.60% April 1, 1995
123 - 140, incl. 90,000 8.75% April 1, 1996
TERM BONDS
141 - 280, incl. 700,000 9.00% April 1, 1999
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The Bonds shall bear interest from their date. Interest on the
Bonds shall be payable October 1, 1979, and thereafter semiannually
on April 1 and October 1 in each year.
The Bonds and the interest thereon shall be payable to bearer
in lawful money of the United States of America upon presentation
and surrender of such Bonds or interest coupons as they respectively
become due at Highland Park Bank and Trust, in the City of Topeka,
Kansas, such bank being hereby designated as the City's paying agent
for the payment of the principal of and interest on the Bonds herein
authorized and sometimes referred to herein as the "Paying Agent".
The Bonds shall be subject to redemption and payment prior to
the stated maturity thereof only as provided in Section 4 of this
Ordinance.
SECTION 4. Redemption and Payment of Bonds Prior to Maturity.
The Bonds shall be subject to redemption and payment prior to the
stated maturity thereof, after the notice specified in Section 5
hereof, as follows:
(a) Each of the Bonds shall be subject to redemption and
payment at the option of the City upon instructions from the Tenant
at any time upon the occurrence of any of the following conditions
or events, provided all of said Bonds are so redeemed and paid
according to their terms: (1) if title to or the permanent use or
use for a limited period of substantially all of the Facility be
condemned by any authority having the power of eminent domain; or
(2) if substantially all of the Facility be damaged or destroyed by
fire or other casualty; or (3) if as a result of any changes in the
Constitution of the State of Kansas, or legislative or administrative
action by the State of Kansas or any political subdivision thereof,
or by the United States, or by reason of action instituted in any
court, the Lease shall have become void or unenforceable or impos-
sible of performance without unreasonable delay or in any other way
by reason of such change of circumstances, unreasonable burdens or
excessive liabilities shall have been imposed on the Tenant, includ-
ing without limitation Federal, state or other ad valorem, pro-
perty, income or other taxes not being imposed on the date of the
Lease. If called for redemption in any of such events, the Bonds
shall be subject to redemption at the principal amount thereof, plus
accrued interest thereon to the date fixed for redemption and payment,
together with a premium of One and one-half (11,2%) percent of the
principal amount of the Bonds so called for redemption and payment.
(b) Each of said Bonds maturing on or after April 1,
1987, shall also be subject to redemption and payment at the option
of said City upon instructions from the Tenant, as a whole on or in
part April 1, 1986, or on any interest payment date thereafter, at
the redemption prices set forth below (expressed as a percentage of
the principal amount plus accrued interest thereon to the date fixed
for redemption and payment:
Redemption Period Redemption Price
April 1, 1986, to March 31, 1996 101.50%
April 1, 1996, and thereafter 100%
Bonds to be redeemed and paid pursuant to this paragraph shall be
redeemed in inverse numerical order.
(c) Each of the Bonds then outstanding shall be redeemed
and paid on a redemption date established by the City in the event
the interest on the Bonds is includable in the gross income of the
recipients thereof for Federal income tax purposes by reason of the
failure of the Bonds to qualify for the exemption provided in Section
103(b)(6)(D) of the Internal Revenue Code of 1954, as amended, at
the principal amount thereof, plus accrued interest thereon to the
date fixed for redemption and payment, together with a premium which
shall be Five (5%) percent of the principal amount of such outstanding
Bonds for each full year or fraction of a year which elapsed between
the date on which interest on such Bonds became taxable and the date
fixed for redemption and payment, but in no event shall the date
fixed for redemption and payment be later than One Hundred Twenty
(120) days after the Internal Revenue Service, the Tenant or the
Fiscal Agent hereinafter designated shall give written notice to the
City of the failure of the Bonds to qualify for such exemption.
As and for a sinking fund for the retirement of the Bonds
maturing April 1, 1999, but subject to the provisions of the
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next paragraph of this Section 4, the rent payments specified in the
Lease which are to be deposited in the Principal and Interest Account
created by Section 12 of this Ordinance commencing on April 1, 1996,
(the "Sinking Fund Deposits"), shall be sufficient to redeem (after
credit as hereinafter provided) and the City hereby agrees to redeem
the following principal amounts of Bonds maturing April 1, 1999, on
April 1 in each of the following years:
YEAR PRINCIPAL AMOUNT
1997 $125,000
1998 225,000
The Bonds maturing on April 1, 1999, to be redeemed and paid pur-
suant to the operation of the Sinking Fund shall be selected by lot
by the Bond Registrar in such equitable manner as it may designate.
The Bond Registrar shall each year in which the Bonds are to be
redeemed pursuant to the terms of said Sinking Fund make timely
selection of Bonds to be so redeemed and shall give or cause the
Fiscal Agent to give notice thereof as provided in Section 5 of this
Ordinance without further instructions from the City or the Tenant.
The Fiscal Agent may, at any time after April 1, 1996, upon
instructions from the Tenant use moneys on hand in the Principal and
Interest Account to purchase Bonds maturing on April 1, 1999, in the
open market at a price not in excess of the then applicable re-
demption price specified above in subsection (b) of this Section 4
and each Bond so purchased shall be credited at 100% of the principal
amount thereof on the obligation of the City on the next Sinking
Fund redemption date for such Bonds and the principal amount of
Bonds to be redeemed by operation of the Sinking Fund shall be
reduced accordingly.
At its option, to be exercised on or before the Forty-fifth
(45) day next preceding any April 1 in the years 1997 to 1998,
inclusive, the City or the Tenant may: (i) deliver to the Fiscal
Agent designated by Section 10 of this Ordinance, for cancellation
of such Bonds maturing on April 1, 1999, in any aggregate principal
amount desired, with all unmatured coupons attached if such Bonds
be coupon Bonds; or (ii) furnish the Fiscal Agent with funds together
with appropriate instructions, for the purpose o,f purchasing any of
said Bonds maturing on April 1, 1999, from any holder or owner
thereof whereupon said Fiscal Agent shall expend such funds for such
purpose to such extent as may be practical; or (iii) receive a
credit in respect to the Sinking Fund obligation of the City under
the second preceding paragraph of this Section for any Bonds maturing
on April 1, 1999, which prior to such date have been redeemed (other
than through the operation of the Sinking Fund requirements of the
second preceding paragraph) and cancelled by the Fiscal Agent and
not theretofore applied as a credit against any redemption obligation
under said paragraph. Each Bond maturing on April 1, 1999, so
delivered or purchased or previously redeemed shall be credited at
100% of the principal amount thereof on the obligation of the City
on such redemption date, and any excess of such amount shall be
credited on future sinking fund obligations for such Bonds in
chronological order and the principal amount of Bonds to be redeemed
by operation of the sinking fund shall be accordingly reduced.
If the City or the Tenant intends to exercise the option granted
by the provisions of sub -provisions (i), (ii) or (iii) of the next
preceding paragraph, the City or the Tenant will on or before the
Forty-fifth (45) day next preceding each April 1 in the years from
1997 to 1998, inclusive, furnish the Fiscal Agent and the Bond
Registrar with a certificate signed by the City Clerk or City Trea-
surer or an appropriate officer of the Tenant indicating to what
extent the provisions of said sub -provisions (i), (ii) and (iii) are
to be complied with in respect to such Sinking Fund payment.
SECTION 5. Notice of Redemption. Notice of the call for any
redemption provided for by this Ordinance identifying the Bonds to
be redeemed shall be given by the Fiscal Agent in the name of the
City by publication at least once in the official state paper of the
State of Kansas, not less than Thirty (30) days prior to the redemp-
tion date. Notice of any such redemption shall also be given by
registered or certified mail to the Paying Agent herein designated
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and to the Original Underwriter of the Bonds at least Thirty (30)
days prior to the date fixed for redemption and payment. Notice of
any such redemption shall also be given to any holders of Bonds who
have placed their names on file with the Fiscal Agent pursuant to
Section 26 hereof, upon mailing a copy of the redemption notice in
the manner hereinbefore specified at least Thirty (30) days prior to
the date fixed for redemption to the owner of each Bond to be redeemed
at the address shown on the books maintained by the Fiscal Agent;
provided, however, that failure to give such notice by mailing as
aforesaid, or any defect therein, shall not affect the validity of
any proceedings for the redemption of Bonds.
If, because of the temporary or permanent suspension of
the publication or general circulation of any newspaper or for any
other reason, it is impossible or impractical to publish such notice
of call for redemption in the manner herein provided, then such
publication in lieu thereof as shall be made with the approval of
the Fiscal Agent shall constitute a sufficient publication of notice.
Interest shall cease on any of said Bonds so called for
redemption and payment as of the redemption date, provided funds are
available in the hands of the Paying Agent to pay the same in ac-
cordance with their terms.
SECTION 6. Method of Execution and Authentication of Bonds.
The Bonds and each of them shall be executed for and on behalf of
the City by the facsimile signature of the Mayor, attested by the
facsimile signature of the City Clerk and the seal of said City
shall be affixed thereto. Interest coupons shall be attached to
said Bonds representing the interest to mature thereon, and said
interest coupons shall bear the facsimile signatures of said Mayor
and City Clerk. The Bonds and each of them shall be registered in
the office of the City Clerk, which registration shall be evidenced
by a manually executed certificate of registration on the reverse
face of each Bond.
In the event either the Mayor or City Clerk should cease to
hold such office before the bonds and coupons bearing their facsimile
signatures have been issued and delivered said bonds may be issued
1
as though said officers had not ceased to hold office and such
signatures appearing on said Bonds and coupons and registration
certificate shall be valid and sufficient for all purposes as if
they had remained in office with such issuance and delivery.
The Bonds shall not be valid obligations under the provisions
of this Ordinance until authenticated by the Fiscal Agent by the
execution of an appropriate certificate appearing on each such Bond.
SECTION 7. Form of Bonds. The Bonds and the interest coupons
attached thereto and the certificates relating thereto shall be in
substantially the following form:
MOM
No.
UNITED STATES OF AMERICA
STATE OF KANSAS
COUNTY OF SALINE
CITY OF SALINA
INDUSTRIAL REVENUE BOND, SERIES of 1979
(Salina Nursing Center, Inc.)
$5,000
KNOW ALL MEN BY THESE PRESENTS: That the City of Salina, in the
County of Saline, State of Kansas, a municipal corporation, for value
received, hereby promises to pay the bearer hereof, solely out of the
revenues hereinafter referred to, the sum of
FIVE THOUSAND DOLLARS
in lawful money of the United States of America, on the first day of
April, 19 , except as the provisions hereinafter set forth with
respect to redemption prior to maturity may become applicable hereto,
and to pay interest thereon from the date hereof at the rate of
( %) percent per annum, payable October 1, 1979, and
thereafter semiannually on April 1 and October 1 in each year, until
the said principal sum shall have been paid, upon presentation and
surrender of the interest coupons hereto attached, bearing the facsi-
mile signatures of the Mayor and City Clerk of said City, as said
coupons severally become due.
Both principal of and interest on this Bond are payable in lawful
money of the United States of America at Highland Park Bank and Trust,
in the City of Topeka, Kansas, hereinafter referred to as the "Paying
Agent".
This Bond is one of a series of 280 coupon Bonds aggregating the
principal amount of $1,400,000 issued by said City for the purpose of
providing funds to pay the cost of acquiring certain real property and
purchasing, constructing and installing certain buildings, improve-
ments, machinery and equipment thereon as further described in the
Ordinance authorizing this Bond (the "Bond Ordinance") and in the
Lease hereinafter and in the Bond Ordinance referred to (the "Lease")
and together constituting the "Facility" to be leased to Salina Nursing
Center, Inc., a Kansas corporation (the "Tenant"), pursuant to the
Lease dated as of April 1, 1979, by and between said City and Tenant
for commercial purposes by the authority of and in conformity with the
provisions, restrictions and limitations of the Constitution and
statutes of the State of Kansas, including K.S.A. 12-1740 to 12-1749a,
and all amendments thereof and acts supplemental thereto, and all
other provisions of the laws of said State applicable thereto.
This Bond and the interest thereon are payable solely from the
money and revenue received from the fees charged and rental received
for the use of the Facility (except to the extent paid out of the
moneys attributable to Bond proceeds or the income from the temporary
investment thereof and, under certain circumstances, proceeds of in-
surance, sale and condemnation awards or payments received pursuant to
the Guaranty Agreement hereinafter referred to) which has been leased
by the City to the Tenant, pursuant to the Lease and not from any
other fund or source. Pursuant to the provisions of said statute, the
governing body of the City has pledged the Facility and the net earn-
ings therefrom to the payment of the series of Bonds of which this
Bond is a part and the interest thereon.
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The Tenant and certain individuals, have entered into a separate
Guaranty Agreement with the Fiscal Agent whereby they have uncondi-
tionally guaranteed, for the benefit of the holders of Bonds of the
series of which this Bond is one, the full and prompt payment of the
principal of and interest and redemption premium, if any, on each of
said Bonds when and as the same become due and payable in accordance
with their terms.
This Bond does not constitute a debt of said City within the
meaning of any constitutional or statutory limitation.
Reference is hereby made to the Bond Ordinance and to the Lease
for a description of the covenants of the City with respect to the
collection, segregation and application of the money and revenue
received from the fees charged and rental received for the use of the
Facility, the rights, duties and obligations of the City and the
Tenant with respect thereto, the right of the City to issue additional
Bonds and the rights of the holders of this Bond.
Each of the Bonds of the series of which this Bond is one is
subject to redemption and payment at the option of the City upon in-
structions from the Tenant, at any time, upon the occurrence of any of
the following conditions or events, provided all Bonds are so redeemed
and paid according to their terms: (1) if title to, or the permanent
use or use for a limited period of, substantially all of the Facility
be condemned by any authority having the power of eminent domain; or
(2) if substantially all of the Facility be damaged or destroyed by
fire or other casualty; or (3) if as a result of any changes in the
Constitution of the State of Kansas, or legislative or administrative
action by the State of Kansas, or any political subdivision thereof,
or by the United States, or by reason of any action instituted in any
court, the Lease shall have become void or unenforceable or impossible
of performance without unreasonable delay, or in any other way, by
reason of such change in circumstances, unreasonable burdens or exces-
sive liabilities shall have been imposed on Tenant, including without
limitation Federal, state or other ad valorem, property, income or
other taxes not being imposed on the date of the Lease. In any of
such events, the Bonds shall be subject to redemption at One Hundred
(100%) percent of the principal amount thereof, plus accrued interest
to the date fixed for redemption and payment, together with a premium
of one and one-half (i1�2%) percent of the principal amount of the Bonds
so called for redemption and payment.
Each of the Bonds of the series of which this Bond is one, ma-
turing on or after April 1, 1987, is also subject to redemption and
payment at the option of said City, upon instructions from the Tenant,
as a whole or in part on April 1, 1986, or on any interest payment
date thereafter, in inverse numerical order, at the redemption prices
set forth below (expressed as a percentage of the principal amount
plus accrued interest thereon to the date fixed for redemption and
payment:
Redemption Period Redemption Price
April 1, 1986, to March 31, 1996 101.50%
April 1, 1996, and thereafter 100.00%
Each of the Bonds of the series of which this Bond is one then
outstanding shall be redeemed and paid on a redemption date estab-
lished by the City in the event the interest on the Bonds is includ-
able in the gross income of the recipients thereof for Federal income
tax purposes by reason of the failure of the Bonds to qualify for the
exemption provided in Section 103(b)(6)(D) of the Internal Revenue
Code of 1954, as amended, at the principal amount thereof, plus ac-
crued interest thereon to the date fixed for redemption and payment,
together with a premium which shall be Five (5%) percent of the prin-
cipal amount of such outstanding Bonds for each full year or fraction
of a year which elapsed between the date on which interest on such
Bonds became taxable and the date fixed for redemption and payment,
but in no event shall the date fixed for redemption and payment be
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later than One Hundred Twenty (120) days after the Internal Revenue
Service, the Tenant or the Fiscal Agent hereinafter designated shall
give written notice to the City of the failure of the Bonds to qualify
for such exemption.
Each of the Bonds of the series of which this Bond is one matur-
ing on April 1, 1999, is also subject to mandatory redemption in
specified annual amounts, pursuant to the terms of the sinking fund
provided for in the Bond Ordinance on April 1, 1997, and on April 1,
1998, at the redemption prices set out above, plus accrued interest to
the redemption date.
All Bonds so called for redemption will cease to bear interest on
the specified redemption date provided funds for their redemption are
on deposit with the Paying Agent prior to the redemption date. Notice
of the call for any redemption provided for by this Ordinance identi-
fying the Bonds to be redeemed shall be given by publication at least
once in the official state paper of the State of Kansas not less than
Thirty (30) days prior to the redemption date. Notice of any such
redemption shall also be given by registered or certified mail to the
Paying Agent herein designated and to the Original Underwriter of the
Bonds at least Thirty (30) days prior to the date fixed for redemption
and payment. Notice of any such redemption shall also be given to any
holders of Bonds who have placed their names on file with the Fiscal
Agent pursuant to Section 26 of the Bond Ordinance, upon mailing a
copy of the redemption notice in the manner hereinbefore specified at
least Thirty (30) days prior to the date fixed for redemption to the
owner of each Bond to be redeemed at the address shown on the books
maintained by the Fiscal Agent; provided, however, that failure to
give such notice by mailing as aforesaid, or any defect therein, shall
not affect the validity of any proceedings for the redemption of
Bonds.
If, because of the temporary or permanent suspension of the pub-
lication or general circulation of any newspaper or for any other
reason, it is impossible or impracticable to publish such notice of
call for redemption in the manner herein provided, then such publica-
tion in lieu thereof as shall be made with the approval of the Fiscal
Agent shall constitute a sufficient publication of notice.
This Bond shall not be valid or binding on said City until this
Bond shall have been authenticated by the execution by the Fiscal
Agent of the Certificate of Authentication hereon.
It is hereby declared and certified that all acts, conditions and
things required to be done, to have happened and to be performed and
to exist precedent to and in the issuance of this Bond, and of the
issue of which this Bond is one, have been properly done and per-
formed, and have happened and do exist in due and regular form and
manner as required by the Constitution and laws of the State of Kansas.
IN WITNESS WHEREOF, the City of Salina, Kansas, has caused this
Bond to be signed by the facsimile signature of its Mayor, attested by
the facsimile signature of its City Clerk and its corporate seal to be
affixed hereto and the interest coupons hereto attached to be signed
with the facsimile signatures of said officers and this Bond to be
dated this first day of April, 1979.
(facsimile)
Attest: Mayor
(facsimile)
City Clerk
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Coupon No.
(FORM OF COUPON)
All coupons for 6 months
due April 1 and October 1
On the first day of , 19 , unless the
Bond to which this coupon is attached shall have been
called for redemption and payment duly made or pro-
vided for, the City of Salina, Kansas, will pay bearer,
solely from the money and revenue received for the
use of the Facility described in the Bond to which
this coupon is attached, and not from any other fund
or source, the amount shown hereon, in lawful money
of the United States of America at Highland Park Bank
and Trust, in the City of Topeka, Kansas,
being interest then due on its Industrial Revenue
Bond, Series of 1979, dated April 1, 1979, No.
(facsimile)
Mayor
Attest:
_ (facsimile)
City Clerk
1, 19
City of
Salina,
Kansas
Industrial
Revenue
Bond,
Series
of 1979
S
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CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds described in the within mentioned
Bond Ordinance.
Highland Park Bank and Trust
Topeka, Kansas
By:
Authorized Officer
STATE OF KANSAS )
) ss:
COUNTY OF SALINE )
I, the undersigned, City Clerk of the City of Salina, Kansas,
hereby certify that the within Industrial Revenue Bond, Series of
1979, of the City of Salina, Kansas, has been duly registered in my
office according to law.
WITNESS MY HAND and official seal this
(Seal) City Clerk
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SECTION 8. Authentication, Execution and Delivery of the Bonds.
The Mayor and City Clerk are hereby authorized and directed to
prepare and execute the Bonds herein authorized, in the manner
hereinbefore specified, and to obtain their authentication by the
Fiscal Agent and to cause said Fiscal Agent to deliver said Bonds to
United Securities, Inc., the purchasers thereof, on payment of the
purchase price therefor. The Fiscal Agent shall authenticate said
Bonds in the principal amount of $1,400,000 and deliver the same as
provided above.
SECTION 9. Designation of Fiscal Agent, Creation of Construction
Fund. First National Bank and Trust Company, in the City of Salina,
Kansas, is hereby designated as the City's Fiscal Agent under the
provisions of this Ordinance and of said Lease, and the proceeds of
the said Bonds shall be deposited with said Fiscal Agent. There is
hereby authorized and ordered to be established in the custody of
said Fiscal Agent a separate fund or account designated "City of
Salina, Kansas, Salina Nursing Center, Inc. Construction Fund"
(hereinafter referred to as the "Construction Fund"), which the
Fiscal Agent shall hold in trust pursuant to the terms hereof.
SECTION 10. Disposition of Bond Proceeds. The Fiscal Agent
shall first pay from the proceeds of the sale of said Bonds any
accrued interest and any premium received therefrom together with
the sum of $179,632 which shall be used to pay interest on the Bonds
during the Construction of the Facility into the "City of Salina,
Kansas, Principal and Interest Account for Salina Nursing Center,
Inc., Industrial Revenue Bonds, Series of 1979, dated April 1, 1979"
hereinafter created by Section 12 of this Ordinance. The balance of
the proceeds of the sale of said Bonds shall be deposited in the
Construction Fund.
Section 11. Acquisition, Purchase, Construction and Equipping
of FACILITY, Use of Construction Fund. The Fiscal Agent shall make
disbursements from the Construction Fund for the acquisition, pur-
chase and construction of the Facility as provided in the Lease.
Any amount remaining in the Construction Fund after the
Facility has been fully completed and paid for, lien free, as pro-
vided in Section 4.10 of the Lease shall be deposited by the Fiscal
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Agent in the Principal and Interest Account created by Section 12 of
this Ordinance.
The City covenants and agrees that it will neither make
nor permit the Fiscal Agent or the Tenant to make any use of the
proceeds of the Bonds which, if such use had been reasonably expected
on the date of issuance of the Bonds, would have caused the Bonds to
be arbitrage bonds within the meaning of Section 103(c) of the
Internal Revenue Code of 1954, as amended, and the City will comply
with, and will take all necessary action to cause the Fiscal Agent
and the Tenant to comply with, all applicable requirements of said
Section 103(c) and the rules and regulations of the United States
Treasury Department thereunder for so long as any of the Bonds
remain outstanding and unpaid.
SECTION 12. Creation of Various Other Accounts. There are
hereby authorized and ordered to be established in the hands of the
Fiscal Agent two separate funds or accounts to be designated as
follows:
(1) "City of Salina, Kansas, Principal and Interest Account
for Salina Nursing Center, Inc., Industrial Revenue Bonds, Series of
1979, dated April 1, 1979" herein sometimes referred to as the
"Principal and Interest Account";
(2) "City of Salina, Kansas, Bond Reserve Account for Salina
Nursing Center, Inc., Industrial Revenue Bonds, Series of 1979,
dated April 1, 1979", herein sometimes referred to as the "Bond
Reserve Account".
The City covenants and agrees that from and after the delivery
of any of the Revenue Bonds herein authorized and continuing so long
as any of said Bonds shall remain outstanding, said City will maintain
said Accounts with the Fiscal Agent.
All payments of Basic Rent received by the Fiscal Agent from
Tenant pursuant to the Lease shall be allocated and transferred by
the Fiscal Agent as follows:
(a) The Fiscal Agent shall first allocate and deposit to
the credit of the Principal and Interest Account the full amount set
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forth in Columns A and B of Schedule II attached hereto and made a
part hereof; provided, however, that in no event shall the amounts
allocated to the Principal and Interest Account in any month be less
than a pro rata portion of the principal of and interest on the
Bonds becoming due on the next succeeding principal or interest
payment date.
(b) Prior to or concurrently with issuance and delivery
of the Bonds, Tenant shall deliver to Fiscal Agent the sum of $50,000
in the form of cash or certificates of deposit, which shall be
deposited by the Fiscal Agent to the credit of the Bond Reserve
Account. Commencing October 1, 1980, and on the first day of each
month thereafter, after providing for the transfer and deposit set
forth in subparagraph (a) above the Fiscal Agent shall set aside and
deposit to the credit of the Bond Reserve Account the amount set
forth in Column C of Schedule II attached hereto and made a part
hereof, until there is deposited to and on hand in said Bond Reserve
Account the sum of $145,000 which sum is hereinafter referred to as
the "Maximum Bond Reserve Account Deposit". When there has been
accumulated and is on hand in the Bond Reserve Account the Maximum
Bond Reserve Account Deposit, no further deposits to said Account
shall be required. However, in the event funds deposited to the
credit of said Bond Reserve Account shall be expended for any pur-
pose herein authorized thereby reducing the balance therein to an
amount less than the Maximum Bond Reserve Account Deposit, Tenant
shall deliver to the Fiscal Agent, immediately upon written demand
therefore, such sum as shall be necessary to restore the balance in
the Bond Reserve Account to the Maximum Bond Reserve Account Deposit.
All amounts credited to and deposited in the Principal
and Interest Account shall be used by the Fiscal Agent for the sole
purpose of paying the principal of and interest on the Bonds herein
authorized as and when the same become due or are called for redemp-
tion and payment.
(d) All amounts credited to and deposited to the credit
of Bond Reserve Account shall be used by the Fiscal Agent for the
purpose of paying the principal of and interest on the Bonds when
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funds are not otherwise available. In addition, amounts credited to
and deposited in Bond Reserve Account may be used by the Fiscal
Agent for the purpose of paying a like amount of the principal of
Bonds maturing in 1999, either at maturity or upon earlier redemption
provided that all of the then outstanding Bonds are called for
redemption and prepayment and further provided Tenant is not then in
default under this Ordinance or the Lease.
SECTION 13. Investments. Moneys credited to the Construction
Fund, the Principal and Interest Account and the Bond Reserve Account
shall be invested by the Fiscal Agent, in such amounts and at such
times as shall reasonably provide for moneys to be available when
required, in direct obligations of the United States Government or
agencies or instrumentalities thereof or in obligations guaranteed
by the United States Government or agencies or instrumentalities
thereof, or in certificates of deposit or other savings or time
deposits of any state or national bank, including the Fiscal Agent,
which are either insured by an agency of the United States Govern-
ment or are secured by direct obligations of the United States
Government. No investment shall be made pursuant to this Section
beyond the time the Fiscal Agent shall determine that said funds
will be required. All interest and profits on investments held in
the Construction Fund, Principal and Interest Account and the Bond
Reserve Account shall be accrued to and become a part thereof and
expended and applied by the Fiscal Agent for the purposes and in the
manner set forth in Section 12.
SECTION 14. Payment of Balance in Accounts to Tenant. After
payment in full of the Bonds and the applicable fees, charges and
expenses of the Fiscal Agent and Paying Agent and other amounts re-
quired to be paid hereunder, all amounts remaining in any fund or
account created by this Ordinance shall be paid to the Tenant as
provided in Section 28.2 of the Lease.
SECTION 15. Covenant to Pay Principal and Interest and Make
Other Payments. The City covenants that it will promptly pay, or
cause to be paid, from funds available for such purposes, the prin-
cipal of and interest and redemption premium, if any, on the Bonds
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issued under this Ordinance and apply the payments of Basic Rent and
Additional Rent provided for in the Lease at the places, on the
dates and in the manner provided herein and in the Lease and in said
Bonds and in the coupons appertaining thereto according to the true
intent and meaning thereof. The principal, interest and redemption
premium, if any, are payable solely from the revenues received from
the fees charged and rental received for the use of the Facility
(except to the extent paid out of the moneys attributable to Bond
proceeds or the income from the temporary investment thereof and,
under certain circumstances, proceeds of insurance, sale and con-
demnation awards or payments received pursuant to the Guaranty
Agreement hereinafter referred to); the Facility and the net earn-
ings therefrom, are pledged to the payment of the Bonds and the
interest thereon as provided in Section 2 hereof. The City further
covenants that it will make, or cause to be made, all other payments
and deposits required hereunder from funds made available for such
purpose under the Lease.
SECTION 16. Covenant to Redeem Bonds and to Give Notice Thereof.
Any moneys received by said City or the Fiscal Agent for the purpose
of, or which may be used for the purpose of, paying said Bonds prior
to their stated date of maturity shall be deposited in said Principal
and Interest Account and shall be applied solely for the purpose of
paying the principal of and interest and redemption premium, if any,
on said Bonds. On receipt of any such funds by said City or the
Fiscal Agent for said purpose, and on receipt of instructions from
the Tenant to call said Bonds, the City will cause the Fiscal Agent
to, and said Fiscal Agent shall, in the name of the City, immediately
call such Bonds for redemption and payment, when the same are subject
to redemption, giving notice thereof in the manner specified as
provided in Section 5 hereof.
SECTION 17. Particular Covenants of the City. So long as any
of the principal of and interest on the Bonds herein authorized
remain outstanding and unpaid, or until payment thereof has been
provided for, the City covenants with each of the holders and owners
of said Bonds as follows:
(a) The City will in good faith comply fully with all the
terms, provisions and conditions of the Lease which require perform-
ance by, or impose duties on, the City and the City will not knowingly
permit any default in said Lease to occur on the part of the City;
it will in good faith fully and promptly enforce all of the terms,
provisions and conditions of the Lease which require performance by,
or impose duties on, the Tenant and in the event of the occurrence
of a default, as defined in the Lease, will in good faith exercise
all rights and remedies conferred by the Lease and the laws of the
State of Kansas necessary for the full and complete protection of
the security and rights of the bondholders and will use its best
efforts to procure a new tenant or tenants for the Facility under
provisions which will provide funds sufficient in amount to make the
rental payments and other payments which the Tenant is required to
make under the Lease, and will deposit the same in the Principal and
Interest Account. If the City is unable to procure a new tenant who
will enter into such a lease, the City may take such good faith
action as shall be in the best interests of the bondholders which
may include the sale of the Facility, and if the Facility is sold,
after deducting all costs of the sale, any moneys derived from such
sale shall be used for the purpose of paying the principal of and
interest and redemption premium, if any, on the Bonds.
(b) The City will in good faith enforce collection of the
rental payments and other charges in the amounts and at the times
set forth in the Lease and will not reduce or cause or permit to be
reduced the rental payments and other charges fixed, established and
required by the Lease nor change or alter the time or times when the
same are due and payable under the Lease, all as provided in the
Lease. The City, however, shall have no obligation to pay the
expenses incurred in connection with such enforcement from its own
funds and its obligation to pay such expenses shall be limited to
funds made available for such purposes by bondholders or other
interest parties.
(c) The City will not permit or consent to any change,
amendment, modification, termination or any assignment of the Lease,
Ii=
except to the extent provided therein, and no such change, amendment,
modification, termination or assignment, if permitted by the Lease,
shall violate the City's obligation under Subsection (b) of this
Section.
(d) The City will not consent to any dissolution, liqui-
dation, consolidation or merger of the Tenant, except to the extent
provided in the Lease.
(e) Any purchase price of the Facility, any proceeds of
condemnation awards, insurance proceeds or other funds intended for
the purpose of paying said Bonds and the interest thereon as provided
in the Lease shall be deposited with the Fiscal Agent and used
solely and exclusively for said purpose. Upon receipt of any such
funds, to the extent deemed feasible by the Fiscal Agent and upon
instructions from the Tenant to call said Bonds, if such instructions
are necessary under the provisions of Section 4 hereof, if said
Bonds then be subject to redemption and payment or as soon thereafter
as said Bonds become subject to redemption, the Fiscal Agent shall
call said Bonds in the name of the City according to their terms and
shall give notice of such redemption as provided in this Ordinance.
Any such funds shall be used for the payment of the principal of the
Bonds herein authorized, accrued interest thereon, any redemption
premium provided for by this Ordinance and for the charges of the
Fiscal Agent and the Paying Agent for.paying the same.
(f) The City will not, except to the extent permitted by
Section 18 hereof, issue any other obligations payable from payments
made by the Tenant pursuant to the Lease, or otherwise, nor volun-
tarily create or cause to be created any debt, lien, pledge, assign-
ment, encumbrance, or any other charge on said payments or on the
Facility, except as provided therein, nor will it, unless provided
for by the terms of said Lease or of this Ordinance, sell or other-
wise dispose of the Facility or any part thereof.
(g) The City will in good faith cause the Tenant to keep
constantly insured all buildings and improvements from time to time
constituting a part of the Facility and obtain other insurance and
bonds in the manner and to the extent provided in the Lease. The
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proceeds of any insurance policies payable to the City shall be paid
to and deposited with the Fiscal Agent as Insurance Trustee. Any of
the proceeds of such policies shall be used and applied in the
manner set forth in said Lease.
(h) The City will use reasonable efforts to cause the
Fiscal Agent to keep adequate books and records relating to the Fa-
cility, which shall be separate and apart from all other books,
records and accounts of the City or the Fiscal Agent in which com-
plete and correct entries shall be made in accordance with standard
principles of accounting of all transactions relating to the Bonds
and the Facility, and the Fiscal Agent shall annually prepare a
statement of all rentals received and funds expended. Any bondholder
or the Tenant or the Original Underwriters, or their agents, shall
have the rights at all reasonable times to inspect all books, records,
accounts and data of the City or the Fiscal Agent relating to the
Facility or the Bonds.
SECTION 18. Additional Bonds. The City may issue from time to
time additional industrial revenue bonds to pay for all or a portion
of the cost of purchasing, constructing and equipping improvements,
additions or extensions to the Facility, which additional bonds
shall be in all respects on a parity with the Bonds herein authorized,
and all such bonds shall be equally and ratably secured by the
.pledge and covenants contained in this Ordinance, provided the
following terms and conditions are met:
(a) The City shall have entered into a lease or agreement
with the Tenant with rentals or payments at least sufficient to pay
the principal of and interest on such additional bonds as the same
become due, on substantially the same terms and conditions as the
Lease herein authorized; and
(b) The City and the Tenant shall have pledged the Facility,
including the additions, improvements and extensions thereto to be
financed by said additional bonds, to the payment of the Bonds
herein authorized and the interest thereon; and
(c) The Tenant is not in default (i) in the payment of
Basic Rent or Additional Rent due under the Lease, or (ii) in per-
formance of any other duty or covenant under the Lease; and
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(d) The issuance of the additional bonds shall not affect
the exemption from Federal income taxation of the interest on the
Bonds herein authorized; and
(e) The obligations of the Tenant assumed in connection
with the issuance of the additional bonds do not violate any provi-
sions of the Lease; and
(f) The Fiscal Agent and the Original Underwriter of the
Bonds herein authorized, shall have given their express written
consent to the issuance of such additional bonds, which consent
shall not be unreasonably withheld.
SECTION 19. Amendments. The provisions of the Bonds authorized
by this Ordinance and provisions of this Ordinance may be modified
or amended at any time by the City with the written consent of the
Tenant, unless the Tenant is in default hereunder or under the
provisions of the Lease, in which event such consent shall not be
necessary, and the consent of the holders of not less than Sixty -Six
and Two -Thirds (66 2/3%) percent in aggregate principal amount of
the Bonds herein authorized at the time outstanding; provided, that
no such modification or amendment shall permit or be construed as
permitting: (a) the extension of the maturity of the principal of
any of the Bonds issued hereunder, or the extension of the maturity
of any interest on any Bonds issued hereunder, or (b) a reduction in
the principal amount of any Bonds or the rate of interest thereon,
or (c) a privilege or priority of any Bond or Bonds, or (d) a reduc-
tion in the aggregate principal amount of Bonds, the consent of the
holders of which is required for any such amendment or modification.
Any provision of the Bonds or of this Ordinance may, however, be
modified or amended in any respect with the written consent of the
holders of all of the Bonds then outstanding. Amendments to this
Ordinance which correct omissions or ambiguities or which add to the
security of the bondholders may be made by the City when agreed to
by the Tenant without the necessity of consent of the holders of any
of the Bonds. Every amendment or modification of a provision of the
Bonds or of this Ordinance shall be expressed in an ordinance of the
City amending or supplementing the provisions of this Ordinance and
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shall be deemed to be a part of this Ordinance. It shall not be
necessary to note on any of the outstanding Bonds any reference to
such amendment or modification, if any. A certified copy of every
such amendatory or supplemental ordinance, if any, and a certified
copy of this Ordinance shall be kept on file in the Office of the
City Clerk and shall be made available for inspection by the holder
of any Bond authorized by this Ordinance, and upon pyament of the
reasonable cost of preparing the same, a certified copy of any such
amendatory or supplemental ordinance or of this Ordinance will be
sent by the City Clerk to any such bondholder or prospective bond-
holder.
The Lease herein authorized may be amended by the City and
the Tenant as provided therein.
SECTION 20. Default, Events of Default. If any of the follow-
ing events occur, it is hereby defined as and declared to be and to
constitute an "event of default" within the meaning of this Ordinance:
(a) Default in the due and punctual payment of any interest
on any Bond;
(b) Default in the due and punctual payment of the prin-
cipal of or redemption premium, if any, on any Bond, whether at the
stated maturity thereof, or upon any prior redemption thereof, or
upon the maturity thereof by declaration under the provisions of
Section 22 hereof;
(c) Default in the performance or observance of any other
of the covenants, agreements or conditions on the part of the City
in this Ordinance or in the Bonds contained or default on the part
of the Tenant under the Lease herein authorized in failing to pay or
cause to be paid the rentals provided in the Lease or in connection
with the matters referred to in Section 17(g) and (h) hereof, and
the continuance thereof for a period of thirty (30) days after
written notice given to the City by the Fiscal Agent or by the
holders of not less than Ten (10%) percent of the aggregate prin-
cipal amount of Bonds then outstanding.
SECTION 21. Enforcement. The provisions of this Ordinance
shall constitute a contract between the City of Salina, Kansas, and
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the holders of the Bonds herein authorized, and the holder of any
one or more of said Bonds may sue to recover interest or principal
which has not been paid according to the terms of said Bond. Not-
withstanding any provisions of this Ordinance to the contrary,
nothing in this Ordinance shall be so construed as to authorize or
permit the City to make any contract or to incur any obligation of
any kind or nature except such as shall be payable solely out of the
rentals from the leased facilities. The holders of Twenty -Five
(25%) percent of the principal amount of Bonds then outstanding may
sue in any action, in mandamus, injunction or other proceedings,
either at law or in equity, to enforce or compel performance of all
duties and obligations required by this Ordinance to be done or
performed by the City or by the Tenant or to compel the City to cure
any default as defined in Section 20 hereof. Nothing contained in
this Ordinance shall, however, be construed to impose on said City
any duty or obligation to levy any taxes either to meet any obliga-
tion contained herein or to pay the principal of or interest on the
Bonds of the City herein authorized.
SECTION 22. Acceleration in the Event of Default. In the
event the Tenant fails to pay when due any installments of Basic
Rent or Additional Rent required under the Lease or the principal of
or interest on the Bonds herein authorized is not paid according to
the terms thereof on the stated maturity date or on the prior redemp-
tion date, or on any interest payment date, as the case may be, the
Fiscal Agent may and upon the written request of the holders of
Twenty -Five (25%) percent of the principal amount of Bonds then
outstanding, shall by written notice given to the Mayor or City
Clerk of the City and to the Tenant, declare the principal of and
interest on all the Bonds herein authorized then outstanding to be
due and payable immediately and upon such declaration given as
aforesaid, said principal and interest shall be immediately due and
payable, anything in said Bonds or in the Ordinance contained to the
contrary notwithstanding. This provision, however, is subject to
the condition that if at any time thereafter, all arrears of Basic
Rent or Additional Rent or of interest, except interest accrued but
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not yet due, and all arrears of principal shall have been paid in
full, as the case may be then in every such case, the holders of a
majority in principal amount of the Bonds then outstanding, by
written notice to the Mayor or City Clerk of the City and to the
Tenant, may rescind and annul such declaration and its consequences,
but no such rescission or annulment shall extend to or affect any
subsequent default or impair any rights consequent thereon. With
regard to nonpayment of the principal of or interest on the Bonds
concerning which notice is given to the Tenant under the provisions
of this Section, the City hereby grants the Tenant full authority
for the account of the City to make such payments forthwith in the
name and stead of the City, and if such payments are so made by the
Tenant for the account of the City, then and in that event, the
declaration shall be deemed to be rescinded and annulled, but no
such rescission or annulment shall extend to or affect any subsequent
default or impair any rights consequent thereon.
SECTION 23. Defeasance. When the principal of and all interest
and redemption premiums, if any, on the Bonds herein authorized
shall have been paid and discharged, then the requirements contained
and the pledge of revenues and other pledges made hereunder and all
other rights granted hereby, shall cease and terminate. Said prin-
cipal, interest and redemption premium, if any, shall be deemed to
have been paid and discharged within the meaning of this Ordinance
and within the meaning of the Lease authorized by this Ordinance
when there shall have been deposited with the Fiscal Agent at or
prior to the maturity or redemption date of said Bonds, in trust for
and irrevocably appropriated thereto, sufficient moneys, including
investments authorized by this Section, for the payment of the
principal thereof and interest to the date of maturity or redemp-
tion, as the case may be, and premium, if any, or if default in such
payment shall have occurred on such date, then to the date of the
tender of such payments, and provision shall also have been made for
all other sums payable under the provisions of this Ordinance;
provided, always, that if any such Bonds shall be redeemed prior to
the maturity thereof, the City shall have elected to redeem such
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Bonds and the Tenant shall have given in the manner provided for by
this Ordinance, the instructions necessary therefor under the provi-
sions of Section 4 hereof and notice of such redemption shall have
been given in the manner provided by this Ordinance. Any moneys or
investments which at any time shall be deposited with said Fiscal
Agent by or on behalf of the City, for the purpose of paying and
discharging any of the Bonds and coupons, shall be, and are hereby
assigned, transferred and set over to such Fiscal Agent in trust for
the respective holders of the Bonds and coupons, and such moneys and
investments shall be and are hereby irrevocably appropriated to the
payment and discharge thereof. Investments, as used in this Section,
shall mean bills, certificates of indebtedness, notes, bonds or
similar securities which are direct obligations of, or the principal
and interest of which are unconditionally guaranteed by, the United
States of America. Investments shall become due prior to the respec-
tive times on which the proceeds thereof shall be required, in
accordance with a schedule established and agreed upon among the
City, the Tenant and the Fiscal Agent at the time of the creation of
such escrow or trust, or the investments shall be subject to redemp-
tion at the.option of the holders thereof to insure such availability
as so needed to meet such schedule. If, through lapse of time, or
otherwise, the holders of said Bonds or coupons shall no longer be
entitled to enforce payment of their obligations, then, in such
event, it shall be the duty of said Fiscal Agent forthwith to return
said funds to the City. All moneys so deposited with the Fiscal
Agent shall be deemed to be deposited in accordance with and subject
to all of the provisions contained in this Ordinance.
SECTION 24. Payments Due on Sundays and Holidays. In any case
where the date of maturity of interest on or principal of the Bonds
or the date fixed for redemption of any Bonds shall be a Sunday or a
legal holiday or a day on which banking institutions are authorized
by law to close, then payment of interest or principal and premium,
if any, need not be made on such date in such city but may be made
on the next succeeding business day not a Sunday or a legal holiday
or a day upon which banking institutions are authorized by law to
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close with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall
accrue for the period after such date.
SECTION 25. Consents, Etc. of Bondholders. Any consent,
request, direction, approval, objection or other instrument required
by this Ordinance or the Lease herein authorized to be signed and
executed by the bondholders may be in any number of concurrent
writings of similar tenor and may be signed or executed by such
bondholders in person or by an agent appointed in writing. Proof of
the execution of any such consent, request, directions, approval,
objection or other instrument or of the writing appointing any such
agent and of the ownership of Bonds, if made in the following manner,
shall be sufficient for any of the purposes of this Ordinance and
shall be conclusive in favor of the City, the Fiscal Agent, the
Paying Agent and the Tenant with regard to any action taken under
such request or other instrument, namely:
(a) The fact and date of the execution by any person of
any such writing may be proved by the certificate of any officer in
any jurisdiction who by law has power to take acknowledgments within
such jurisdiction that the person signing such writing acknowledged
before him the execution thereof, or by affidavit of any witness to
such execution.
(b) The fact of the holding by any person of Bonds and/or
coupons transferable by delivery and the amounts and numbers of such
Bonds, and the date of the holding of same, may be proved by a cer-
tificate executed by any trust company, bank or bankers, wherever
situated, stating that at the date thereof the party named therein
did exhibit to an officer of such trust company or bank or to such
bankers, as the property of such party, the Bonds and/or coupons
therein mentioned if such certificate shall be deemed by the person
to whom such consent is addressed to be satisfactory. Such person
may, in his or its discretion, require evidence that such Bonds have
been deposited with a bank, bankers or trust company, before taking
any action based on such ownership. In lieu of the foregoing, such
person may accept other proofs of the foregoing as it shall deem
appropriate.
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SECTION 26. List of Bondholders. To the extent that such in-
formation shall be made known to the City under the terms of this
Section, it -will keep on file at the principal office of the Fiscal
Agent a list of names and addresses of the last known holders of all
Bonds payable to bearer and believed to be held by each of such last
known holders. Any bondholder may request that his name and address
be placed on said list by filing a written request with the City or
with the Fiscal Agent which request shall include a statement of the
principal amount of Bonds held by such holder and the numbers of
such Bonds. The Fiscal Agent shall be under no responsibility with
regard to the accuracy of said list. At reasonable times and under
reasonable regulations established by the Fiscal Agent said list may
be inspected and copied by the Tenant or by the holders and/or
owners (or a designated representative thereof) of Twenty -Five (25%)
percent or more in principal amount of Bonds then outstanding, such
ownership and the authority of any such designated representative to
be evidenced to the satisfaction of the Fiscal Agent.
SECTION 27. Provisions Relating to the Fiscal Agent.
(a) Prior to the receipt of the Bond proceeds pursuant to
the provisions hereof, the Fiscal Agent shall file with the City
Clerk its written acceptance of the duties specified in this Ordi-
nance and in the Lease and its agreement to act in said capacity.
(b) The Fiscal Agent duties and responsibilities shall be
limited to those expressly set forth in this Ordinance and under the
Lease.
.(c) All resolutions, opinions, certificates and other
instruments referred to or provided for herein or in the Lease may
be accepted by the Fiscal Agent as conclusive evidence of the facts,
opinions and conclusions stated therein and shall be full warrant,
protection and authority to the Fiscal Agent for any action reason-
ably taken pursuant thereto. The Fiscal Agent shall be under a duty
to examine any such resolutions, opinions, certificates and other
instruments to determine whether or not they conform to the require-
ments of this Ordinance and the Lease.
W
(d) The Fiscal Agent shall not be liable with respect to
any action taken or omitted to be taken by it in good faith and, if
appropriate, upon advice of counsel who may be counsel for the
Fiscal Agent or the City or the Tenant.
(e) No provision contained in this Section shall be con-
strued to relieve the Fiscal Agent from liability for its own negli-
gent action, its own negligent failure to act, or its own willful
misconduct, except that this subsection shall not be construed to
limit the effect of subsections (b), (c) and (d) of this Section.
(f) The Fiscal Agent shall have the right to buy, sell,
own, deal or trade in the Bonds or the coupons relating thereto
without giving notice thereof to the City, the Tenant or any bond-
holder and without incurring any liability whatsoever with respect
thereto.
(g) The Fiscal Agent may resign by an instrument in
writing delivered to the City and the Tenant to take effect not
sooner than Ninety (90) days after its delivery, whereupon the City,
with the consent of the Tenant, shall immediately, in writing,
designate a successor Fiscal Agent. Such successor Fiscal Agent
shall be a bank, trust company or national banking association which
is a member of the Federal Reserve System and has a capital stock
and surplus aggregating at least Two Million ($2,000,000.00) Dollars.
Such successor Fiscal Agent shall be subject to the same duties and
obligations and shall have the same rights, privileges and immunities
specified in this Ordinance and in the Lease for the Fiscal Agent.
Any such successor Fiscal Agent shall file an acceptance in the form
referred to in subparagraph (a) hereof with the City Clerk within
Ten (10) days of its appointment.
(h) The Fiscal Agent shall be entitled to payment or
reimbursement for reasonable fees for its ordinary services and all
advances, counsel fees and other ordinary expenses reasonably and
necessarily made or incurred by it in connection with its ordinary
services, all such fees and expenses to be paid by the Tenant as
Additional Rent as specified in Section 2.3 of the Lease.
-29-
(i) The City may, but only with the consent of the Tenant,
for any reason, remove the Fiscal Agent or any of its successors
hereunder and appoint a new Fiscal Agent in its place and stead, and
such new Fiscal Agent shall, when appointed, become successor to the
powers, duties and obligations conferred on the Fiscal Agent.
SECTION 28. Conveyance of Facility to Tenant. Upon receipt by
the City of the purchase price of the Facility as provided in Section
17.2 of the Lease, title to the Facility shall be transferred and
conveyed to the Tenant as provided in the Lease, and the Mayor and
other appropriate officers of said City are hereby authorized and
directed to execute such deeds and other instruments as may be
necessary to effect such conveyance and transfer.
SECTION 29. Authorization of Lease. The Facility to be pur-
chased, constructed and equipped pursuant to this Ordinance and said
Lease shall be leased to the Tenant under and pursuant to the Lease
dated as of April 1, 1979, substantially in the form attached to
this Ordinance, which Lease including any changes necessary to
correct omissions or ambiguities therein, which the officers execut-
ing the same are hereby authorized to make, the Mayor and City Clerk
are hereby authorized and directed to execute for and on behalf of
and as the act and deed of the City.
SECTION 30. Guaranty Agreement. As and for an express con-
dition precedent to the issuance and delivery of the Bonds, there
shall be executed and delivered by Tenant and the Fiscal Agent a
Guaranty Agreement dated as of April 1, 1979, substantially in the
form attached to this Ordinance.
SECTION 31. Severability. If any one or more of the covenants,
agreements or provisions of this Ordinance or of the Lease should be
held contrary to any express provision of law or contrary to the
policy of express law, though not expressly prohibited, or against
public policy, or shall for any reason whatsoever be held invalid,
then such covenants, agreements or provisions shall be null and void
and shall be deemed separate from the remaining covenants, agreements
or provisions of this Ordinance or of the Bonds issued hereunder, or
of the Lease.
-30-
SECTION 32. Agreements of the City. All covenants, stipulations
and obligations of the City contained in this Ordinance and contained
in the Lease shall be deemed to be the covenants, stipulations,
obligations and agreements of the City to the full extent authorized
or permitted by the Act, and all such covenants, stipulations,
obligations and agreements shall be binding upon the City and its
successors from time to time and upon any board, body or agency to
which any powers or duties, affecting such covenants, stipulations,
obligations and agreements, shall be transferred by or in accordance
with law, nothing contained in this Ordinance shall, however, be
construed to impose on said City any duty or obligation contained
herein or to pay the principal of or interest on the Bonds of the
City herein authorized. Except as otherwise provided in this Ordi-
nance, all rights, powers and privileges conferred and duties and
liabilities imposed upon the City or any officials thereof by the
provisions of this Ordinance or the Lease shall be exercised or
performed by the City or by such officers as may be required by law
to exercise such powers and to perform such duties. No covenant,
stipulation, obligation or agreement herein contained or contained
in the Lease shall be deemed to be a covenant, stipulation, obligation
or agreement of any official, officer, agent or employee of the City
in his individual capacity, and neither the officials of the City
nor any officer executing the Bonds.shall be liable personally on
the Bonds or incur any personal liability or accountability by
reason of the issuance thereof.
SECTION 33. Performance of Acts. All acts, conditions and
things required by the Constitution and laws of the State of Kansas,
relating to the passage of this Ordinance, to the issuance of the
Bonds or to the execution of the Lease, to happen, exist and be per-
formed precedent to and in the enactment of this Ordinance, and
precedent to the issuance of the Bonds and precedent to the execution
of the Lease have happened, exist and have been performed as so
required by law.
SECTION 34. Reports; Original Underwriters. The Original
Underwriters, United Securities, Inc., shall not be under any obli-
-31-
1
1
1
gation to any bondholder for any action that it or they may or may
not take or in respect of anything that it or they may not do by
reason of any information contained in any reports or other docu-
ments received by it or them under the provisions of this Ordinance
or the Lease. The immunities and exemptions from liability of such
Original Underwriter hereunder shall extend to its partners, directors,
officers, successors, employees and agents.
SECTION 35. Further Authority. The officials of the City, its
attorneys, engineers and other agents or employees are hereby autho-
rized to do all acts and things required of them by this Ordinance
and the Lease for the full, punctual and complete performance of all
of the terms, covenants and agreements contained in the Bonds, the
Lease and this Ordinance.
SECTION 36. Effective Date. This Ordinance shall be in full
force and effect from and after its passage and publication in the
official City paper.
PASSED by the Governing Body of the.City of Salina, Kansas,
36tk
this day of April, 1979.
Attest:
D. L. Harrison, City Clerk
Karen M. Graves, Mayor
-32-
SCHEDULE 1
SCHEDULE 1 TO ORDINANCE NO. 8709 OF THE CITY OF
SALINA, KANSAS, AND TO THE LEASE DATED APRIL 1,
1979, BY AND BETWEEN SAID CITY AND SALINA
NURSING CENTER, INC. AUTHORIZED BY SAID ORDINANCE.
PROPERTY SUBJECT TO LEASE
(a) The following described real estate located in Saline
County, Kansas, to wit:
Lot Twenty-five (25) except the East 300 feet
thereof on Johnstown Avenue, in Surveyor's Plat
G to the City of Salina, Saline County, Kansas.
said real property constituting the "Land" as referred to in said
Lease.
(b) All buildings, improvements, machinery and equipment
now or hereafter constructed, located or installed on the Land pur-
suant to said Lease, constituting the "Improvements" as referred to in
said Lease and said Ordinance, and more specifically described as
follows:
The Improvements will consist of an "x" -shaped structure
containing four wings with a centrally -located circular nursing
station. The nursing center will provide 6 rooms designed for
isolation or single occupancy and 54 rooms for double occupancy.
Construction will be of wood frame with brick veneer on a concrete
slab on grade. Interior walls will be of wood stud construction
with drywall finish. A fire sprinkling system will be provided
throughout the building, including attic areas. The building
will be completely heated and air conditioned with zone controls.
The exterior walls and attic area will be fully insulated to a
rating of R-15 or better. Insulated glass or storm windows will
be used throughout the structure. Included within the nursing
center will be a dietary department and dining area, activity
rooms for hobby and crafts work, restorative service area, two
solariums, laundry facilities, medical prep rooms and administra-
tive and employee lounge area. The Facility will meet all the
requirements of applicable building codes and federal regulations
necessary for licensing and operation.
the property described in paragraphs (a) and (b) of this Schedule 1
together constituting the "Facility" as referred to in said Lease and
said Ordinance.
1
1
1
SCHEDULE 1
SCHEDULE 1 TO ORDINANCE NO. 8709 OF THE CITY OF
SALINA, KANSAS, AND TO THE LEASE DATED APRIL 1,
1979, BY AND BETWEEN SAID CITY AND SALINA
NURSING CENTER, INC. AUTHORIZED BY SAID ORDINANCE.
PROPERTY SUBJECT TO LEASE
(a) The following described real estate located in Saline
County, Kansas, to wit:
Lot Twenty-five (25) except the East 300 feet
thereof on Johnstown Avenue, in Surveyor's Plat
G to the City of Salina, Saline County, Kansas.
said real property constituting the "Land" as referred to in said
Lease.
(b) All buildings, improvements, machinery and equipment
now or hereafter constructed, located or installed on the Land pur-
suant to said Lease, constituting the "Improvements" as referred to in
said Lease and said Ordinance, and more specifically described as
follows:
The Improvements will consist of an "x" -shaped structure
containing four wings with a centrally -located circular nursing
station. The nursing center will provide 6 rooms designed for
isolation or single occupancy and 54 rooms for double occupancy.
Construction will be of wood frame with brick veneer on a concrete
slab on grade. Interior walls will be of wood stud construction
with drywall finish. A fire sprinkling system will be provided
throughout the building, including attic areas. The building
will be completely heated and air conditioned with zone controls.
The exterior walls and attic area will be fully insulated to a
rating of R-15 or better. Insulated.glass or storm windows will
be used throughout the structure. Included within the nursing
center will be a dietary department and dining area, activity
rooms for hobby and crafts work, restorative service area, two
solariums, laundry facilities, medical prep rooms and administra-
tive and employee lounge area. The Facility will meet all the
requirements of applicable building codes and federal regulations
necessary for licensing and operation.
the property described in paragraphs (a) and (b) of this Schedule 1
together constituting the "Facility" as referred to in said Lease and
said Ordinance.
SCHEDULE II
RENTAL PAYMENT SCHEDULE
B C
DEPOSIT TO
INTEREST BOND RESERVE
$ 9,997.92(2)
9,997.92(2)
9,997.92(2)
9,997.92
9,997.92
9,997.92
9,997.92
9,997.92
9,997.92
9,997.92
9,816.67
9,816.67
9,573.33
9,573.33
9,326.67
9,326.67
9,076.67
9,076.67
8,753.75
8,753.75
8,420.42
8,420.42
8,082.92
8,082.92
7,741.25
7,741.25
7,395.42
7,395.42
6,975.42
6,975.42
6,479.58
6,479.58
5,906.25
5,906.25
5,250.00
5,250.00
4,312.50
4,312.50
2,625.00
2,625.00
$319,450.90
(1) Deposited into Bond Reserve Account
(not included in monthly payment).
Interest escrowed in the bond issue.
$50,000.00(1)
-0-
-0-
4,000.00
4,000.00
4,000.00
4,000.00
-0-
-0-
- 0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0_
$16,000.00
TOTAL
MONTHLY
BASIC RENT
$ 9,997.92(
9,997.92(
9,997.92(
13,997.92
13,997.92
13,997.92
13,997.92
9,997.92
12,497.92
12,497.92
13,150.00
13,150.00
12,906.66
12,906.66
12,660.00
12,660.00
13,243.34
13,243.34
12,920.42
12,290.42
12,587.09
12,587.09
12,249.59
12,249.59
11,907.92
11,907.92
12,395.42
12,395.42
12,808.75
12,808.75
13, 146. 2,5
13,146.2-
13,406.25
3,146.213,406.25
13,406.25
15,666.67
15,666.67
23,062.50
23,062.50
31,791.67
31,791.67
$568,784.26
by the incorporators on date of closing
A
DATE
PRINCIPAL
4-1-79
to
9-1-79
$ -0-
10-1-79
to
3-1-80
-0-
4-1-80
to
9-1-80
-0-
10-1-80
to
3-1-81
-0-
4-1-81
to
9-1-81
-0-
10-1-81
to
3-1-82
-0-
4-1-82
to
9-1-82
-0-
10-1-82
to
3-1-83
-0-
4-1-83
to
9-1-83
2,500.00
10-1-83
to
3-1-84
2,500.00
4-1-84
to
9-1-84
3,333.33
10-1-84
to
3-1-85
3,333.33
4-1-85
to
9-1-85
3,333.33
10-1-85
to
3-1-86
3,333.33
4-1-86
to
9-1-86
3,333.33
10-1-86
to
3-1-87
3,333.33
4-1-87
to
9-1-87
4,166.67
10-1-87
to
3-1-88
4,166.67
4-1-88
to
9-1-88
4,166.67
10-1-88
to
3-1-89
4,166.67
4-1-89
to
9-1-89
4,166.67
-1-89
to
3-1-90
4,166.67
-1-90
to
9-1-90
4,166.67
-1-90
to
3-1-91
4,166.67
4-1-91
to
9-1-91
4,166.67
10--1-91
to
3-1-92
4,166.67
4-1-92
to
9-1-92
5,000.00
10-1-92
to
3-1-93
5,000.00
4-L-93
to
9-1-93
5,833.33
10-1-93
to
3-1-94
5,833.33
4-1-94
to
9-1-94
6,666.67
10-1-94
to
3-1-95
6,666.67
4-1-95
to
9-1-95
7,500.00
10-1-95
to
3-1-96
7,500.00
4-1-96
to
9-1-96
10,416.67
10-1-96
to
3-1-97
10,416.67
4-1-97
to
9-1-97
18,750.00
10-1-97
to
3-1-98
18,750.00
4-1-98
to
9-1-98
29,166.67
10-1-98
to
3-1-99
29,166.67
$233,333.36
B C
DEPOSIT TO
INTEREST BOND RESERVE
$ 9,997.92(2)
9,997.92(2)
9,997.92(2)
9,997.92
9,997.92
9,997.92
9,997.92
9,997.92
9,997.92
9,997.92
9,816.67
9,816.67
9,573.33
9,573.33
9,326.67
9,326.67
9,076.67
9,076.67
8,753.75
8,753.75
8,420.42
8,420.42
8,082.92
8,082.92
7,741.25
7,741.25
7,395.42
7,395.42
6,975.42
6,975.42
6,479.58
6,479.58
5,906.25
5,906.25
5,250.00
5,250.00
4,312.50
4,312.50
2,625.00
2,625.00
$319,450.90
(1) Deposited into Bond Reserve Account
(not included in monthly payment).
Interest escrowed in the bond issue.
$50,000.00(1)
-0-
-0-
4,000.00
4,000.00
4,000.00
4,000.00
-0-
-0-
- 0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0-
-0_
$16,000.00
TOTAL
MONTHLY
BASIC RENT
$ 9,997.92(
9,997.92(
9,997.92(
13,997.92
13,997.92
13,997.92
13,997.92
9,997.92
12,497.92
12,497.92
13,150.00
13,150.00
12,906.66
12,906.66
12,660.00
12,660.00
13,243.34
13,243.34
12,920.42
12,290.42
12,587.09
12,587.09
12,249.59
12,249.59
11,907.92
11,907.92
12,395.42
12,395.42
12,808.75
12,808.75
13, 146. 2,5
13,146.2-
13,406.25
3,146.213,406.25
13,406.25
15,666.67
15,666.67
23,062.50
23,062.50
31,791.67
31,791.67
$568,784.26
by the incorporators on date of closing