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8670 IRB United BuildingRt.bliShcd in -(h,( SA -J i n a. JcuY(Gi..l can CY—Anbe� 2S, 149-7E) ORDINANCE NO. 8670 AN ORDINANCE AUTHORIZING THE CITY OF SALINA, KANSAS TO ACQUIRE THE UNITED BUILDING CONDOMINIUM UNITS, THE REAL ESTATE, IMPROVEMENTS AND COMMON AREAS APPLICABLE THERETO, AND TO RECONSTRUCT, REPAIR, ENLARGE, REMODEL AND IMPROVE THE SAME FOR USE AS COMMERCIAL FACILITIES TO BE LEASED TO CERTAIN OCCUPANTS OF SUCH CONDOMINIUM UNITS; AUTHORIZING AND DIRECTING THE ISSUANCE OF $990,000.00 PRINCIPAL AMOUNT OF SALINA, KANSAS, UNITED BUILDING OF SALINA INDUSTRIAL REVENUE BONDS OF 1978, OF SAID CITY FOR THE PURPOSE OF PROVIDING FUNDS FOR THE ACQUISITION OF SAID CONDOMINIUM UNITS, THE REAL ESTATE, IMPROVEMENTS AND COMMON AREAS APPLICABLE THERETO, AND THE RECONSTRUCTION, REPAIR, ENLARGEMENT, REMODELING AND IMPROVEMENT OF THE BUILDING, WHICH CONSISTS OF SUCH CONDOMINIUM UNITS, AND TO PURCHASE AND INSTALL MACHINERY AND EQUIPMENT TO BE USED FOR COMMERCIAL FACILITIES TO BE LEASED TO CERTAIN OCCUPANTS OF THE CONDOMINIUM UNITS; AND PRESCRIBING THE FORM AND AUTHORIZING THE EXECUTION OF LEASES BY AND BETWEEN SAID CITY AND CERTAIN OCCUPANTS OF SAID CONDOMINIUM UNITS WHEREAS, the City of Salina, Kansas, a city of the first class, hereinafter sometimes referred to as "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, the 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 nine series of industrial revenue bonds of the City in the principal amount of $110,000.00 each or the aggregate principal amount of $990,000.00, be authorized and issued for the purpose of providing funds to acquire the condominium units described herein, including the real estate hereinafter described, and - 1 - to reconstruct, repair, enlarge, remodel and improve the same, and to purchase and install machinery and equipment therein, all to be used as a commercial facility to be leased to several of the occupants of the condominium units established pursuant to a certain Declaration of Condominium Owners of the United Building, dated as of January 1, 1978, as hereinafter set forth, the proceeds of said bonds to be used only for said purposes in conjunction with funds other- wise made available for said purposes. NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF SALINA, KANSAS: SECTION 1. That the City of Salina, Kansas, is hereby authorized to acquire the condominium units established under a certain Declaration of Condominium Owners of the United Building, dated as of January 1, 1978, recorded in the office of the Register of Deeds of Saline County, Kansas, in Volume 118 of Miscellaneous at Pages 595 to 619, inclusive, hereinafter referred to as "Condominium Declara- tion", including the interest of the respective condominium units in the following described real estate: The West forty-eight feet and two inches (48' 211) of Lots One Hundred Nine (109) and One Hundred Eleven (111) and the West forty-eight feet and two inches (48' 211) of the North twenty feet (201) of Lot One Hundred Thirteen (113), on Seventh Street in the Original Town (now City) of Salina, Saline County, Kansas; together with the building and improvements located thereon, and the condominium units applicable thereto, and to recon- struct, repair, enlarge, remodel and improve such condo- minium units and to purchase certain machinery and equipment to be installed therein, as hereinafter set forth, all here- inafter sometimes referred to as the "project", to be used !W�= as commercial facilities in accordance with the provisions of certain Leases dated as of October 1, 1978, between the City and the several occupants of the condominium units established under the Condominium Declaration, namely each K & C, Inc., a Kansas corporation with its principal place of business at Salina, Kansas, Rakin Land & Cattle Company, a general partnership with its principal place of business at Salina, Kansas, MarketAide, a general partnership with its principal place of business at Salina, Kansas, Kennedy, Berkley, Simpson and Yarnevich, Chartered, a Kansas profes- sional corporation with its principal place of business at Salina, Kansas, and Hampton, Royce, Engleman & Nelson, a general partnership with its principal place of business at Salina, Kansas, hereinafter referred to as "Leases", said Leases being authorized by Section 16 of this Ordinance. The cost of the project shall not exceed the sum of $990,000.00 to the City. SECTION 2. That for the purpose of acquiring, recon- structing, repairing, enlarging, remodeling and improving the project to be leased to certain occupants of the Condo- minium Units, there shall be issued and hereby are autho- rized and directed to be issued nine separate series of bonds identified as Series A through Series I, respectively, to be known as United Building of Salina Industrial Revenue Bonds of 1978, of the City of Salina, Kansas, with each such series of bonds to be in the principal amount of $110,000.00 and with all such series of bonds to be in the aggregate principal amount of $990,000.00, hereinafter sometimes referred to as "bonds" or "revenue bonds". Each series of the bonds and interest thereon shall be paid solely and only from the money and revenues received from the fees charged and rentals received for the use of the condominium units MIM applicable to such series of bonds and not from any other fund or source except as otherwise specifically set forth herein. The City hereby pledges the project and the net earnings from each such condominium unit to the payment of the series of bonds applicable thereto and the interest thereon, so that payment of each such series of bonds is secured by the condominium unit applicable thereto, subject to the Condominium Declaration. The condominium unit applicable to each series of bonds is determined by reference to the office spaces defined in the Condominium Declaration, as follows: Condominium Applicable Principal Amount Unit Bond Series of Bonds Office Space 2 Series A $110,000.00 Office Space 3 Series B $110,000.00 Office Space 4 Series C $110,000.00 Office Space 5 Series D $110,000.00 Office Space 6 Series E $110,000.00 Office Space 7 Series F $110,000.00 Office Space 8 Series G $110,000.00 Office Space 9 Series H $110,000.00 Office Space 10 Series I $110,000.00 Aggregate Principal Amount of all Series of Bonds $9901000.00 References herein to a condominium unit shall be deemed to be the office space of such unit as defined in the Condo- minium Declaration including the interest of such condo- minium unit in the common areas described therein. SECTION 3. The Salina, Kansas, United Building of Salina Revenue Bonds of 1978, of the City of Salina, Kansas, shall consist of nine separate series of bonds, identified as Series A through Series I, respectively, with each series to consist of twenty-two bonds, numbered from one to twenty- two, inclusive. Each of the bonds shall be in the denomi- nation of $5,000.00. All of the bonds shall be dated as of October 1, 1978, shall be identified by series, shall be separately numbered by series and shall become due serially as follows: Each Series Principal Bond Numbers Amount Maturity Bond No. 1 $5,000.00 April 1, 1979 Bond No. 2 $5,000.00 October 1, 1979 Bond No. 3 $5,000.00 April 1, 1980 Bond No. 4 $5,000.00 October 1, 1980 Bond No. 5 $5,000.00 April 1, 1981 Bond No. 6 $5,000.00 October 1, 1981 Bond No. 7 $5,000.00 April 1, 1982 Bond No. 8 $5,000.00 October 1, 1982 Bond No. 9 $5,000.00 April 1, 1983 Bond No. 10 $5,000.00 October 1, 1983 Bond No. 11 $5,000.00 April 1, 1984 Bond No. 12 $5,000.00 October 1, 1984 Bond No. 13 $5,000.00 April 1, 1985 Bond No. 14 $5,000.00 October 1, 1985 Bond No. 15 $5,000.00 April 1, 1986 Bond No. 16 $5,000.00 October 1, 1986 Bond No. 17 $5,000.00 April 1, 1987 Bond No. 18 $5,000.00 October 1, 1987 Bond No. 19 $5,000.00 April 1, 1988 Bond No. 20 $5,000.00 October 1, 1988 Bond No. 21 $5,000.00 April 1, 1989 Bond No. 22 $5,000.00 October 1, 1989 The bonds of Series A, B, C, D, F, H and I shall bear interest at the rate of 61,27. per annum from October 1, 1978, until fully paid; and the bonds of Series E and G shall bear interest on Bond Nos. 1 to 11, inclusive, at the rate of 51-2% per annum, and shall bear interest on Bond Nos. 12 to 22, inclusive, at the rate of 61,2% per annum, from October 1, 1978, until fully paid; with accrued interest payable April 1, 1979, and thereafter semi-annually on April 1st and October 1st of each year. The bonds and the interest coupons to be attached thereto as hereinafter provided shall be payable in lawful money of the United States of America at the main office of The Planters State Bank and Trust Company, in the City of Salina, Kansas, hereinafter sometimes referred to as the "Paying Agent". - 5 - Each series of bonds shall be subject to redemption and payment in numerical order, as herein set forth, from money available for such purpose, on the stated maturity date for such bond, or on any interest payment date thereafter, at the par value thereof, plus accrued interest thereon to the stated maturity date for such bond. Each series of bonds shall be subject to redemption and prepayment without any prepayment premium or penalty prior to the stated maturity date for such bond, on any interest payment date, as herein set forth, in numerical order. Any series of bonds or any part thereof may be prepaid as herein set forth without a comparable prepayment for any other series of bonds issued hereunder. Notice of a redemption of any bond of any series of bonds provided for or permitted by this Ordinance at any time other than the stated maturity date specified for such bond shall be given in the name of the City by the Fiscal Agent or the applicable Lessee by certified or registered United States Mail or by delivery in person to the Paying Agent herein designated, such notice to be mailed or delivered in person at least 20 days prior to the date fixed for such prior redemption and prepayment and specify the number of each bond to be redeemed and prepaid. Interest shall cease on each bond so called for prior redemption and prepayment as of the redemption date, provided funds are available to prepay the same and accrued interest thereon according to their terms on the redemption date. Upon receipt of any such written notice, the Paying Agent shall give written notice of such prior redemption and prepayment to the holder or holders of the series of bonds so redeemed and prepaid as shown on the list of bondholders to be maintained in accordance with Section 8 and shall give a similar written notice to the person presenting any coupon SECTION 4. Each of the series of bonds and each of the bonds shall be executed for and on behalf of the City by the facsimile signature of its Mayor and attested by the facsimile signature of the City Clerk on the face of each bond, with the seal of the City affixed. Interest coupons shall be attached to each series of bonds representing the interest to mature thereon on or before the maturity date of such bond, and the interest coupons shall bear the facsimile signatures of the Mayor and City Clerk of the City. Each of the series of bonds and each of the bonds shall be regis- tered in the office of the City Clerk of said City, which registration shall be evidenced by a certificate on the reverse side thereof bearing the manual signature of the City Clerk of the City. SECTION 5. Each of the bonds of each series and interest coupons and certificates attached thereto shall be in substantially the following form: �m detached from such bond for payment if the bond is not tendered for redemption and prepayment with such coupon. The Paying Agent shall be under no further obligation to give notice of such redemption and prepayment hereunder. Any bond (and the coupons for such bond) which is called for prior redemption and prepayment as herein set forth shall cease to bear interest and shall not be deemed to be out- standing hereunder from and after the applicable redemption date or the date the funds for full payment thereof are deposited with the Paying Agent, whichever of said dates is later. As used herein, the applicable Lessee shall be the Lessee designated in Section 16 of this Ordinance for the condominium unit to which a series of bonds is applicable as set forth in Section 2 of this Ordinance. SECTION 4. Each of the series of bonds and each of the bonds shall be executed for and on behalf of the City by the facsimile signature of its Mayor and attested by the facsimile signature of the City Clerk on the face of each bond, with the seal of the City affixed. Interest coupons shall be attached to each series of bonds representing the interest to mature thereon on or before the maturity date of such bond, and the interest coupons shall bear the facsimile signatures of the Mayor and City Clerk of the City. Each of the series of bonds and each of the bonds shall be regis- tered in the office of the City Clerk of said City, which registration shall be evidenced by a certificate on the reverse side thereof bearing the manual signature of the City Clerk of the City. SECTION 5. Each of the bonds of each series and interest coupons and certificates attached thereto shall be in substantially the following form: �m Series No. UNITED STATES OF AMERICA STATE OF KANSAS COUNTY OF SALINE CITY OF SALINA SALINA, KANSAS UNITED BUILDING OF SALINA INDUSTRIAL REVENUE BOND OF 1978 Series $5,000.00 KNOW ALL MEN BY THESE PRESENTS: That the City of Salina, in the County of Saline, State of Kansas, for value received, hereby promises to pay to the bearer, solely and only from the revenues hereinafter specified, the sum of FIVE THOUSAND DOLLARS in lawful money of the United States of America, on or before April 1, 1989, together with interest thereon at the rate of % per annum, from October 1, 1978 until fully paid (likewise payable out of the revenues hereinafter specified), with interest payable on April 1, 1979, and thereafter semi-annually on April lst and October lst of each year after the date hereof until said principal sum shall have been paid, upon presentation and surrender of the interest coupons hereto attached, bearing the facsimile signatures of the Mayor and City Clerk of said City as said coupons severally become due. Both principal of and interest on this bond is payable at the main office of The Planters State Bank and Trust Company, in the City of Salina, Kansas (hereinafter sometimes referred to as the "Paying Agent"). THIS BOND is one of an authorized issue of nine separate series of bonds of like date and tenor, except as to the stated series thereof, interest rate, maturity date and number, with each such series in the aggregate principal amount of $110,000.00, numbered from 1 to 22, inclusive, each in the denomination of $5,000.00, and with all nine separate series of bonds, identified as Series A through Series I, respectively, in the aggregate principal amount of $990,000.00, authorized by Ordinance of said City, issued for the purpose of providing funds to acquire the condo- minium units and the real estate, improvements and common areas applicable thereto, as described in Section 1 of said Ordinance, to reconstruct, repair, enlarge, remodel and improve such condominium units and to purchase and install machinery and equipment therein, all to be used as commer- cial facilities (hereinafter sometimes referred to as the "project") to be leased to certain occupants of the United Building of Salina, 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 the State of Kansas applicable thereto, and in accordance with Leases dated as of October 1, 1978, between the City of Salina, Kansas and such occupants (hereinafter sometimes referred to as the "Leases"). This bond does not constitute a debt of the City within the meaning of any constitutional or statutory limitation. This bond and all interest thereon shall be payable by the City of Salina, Kansas, solely and only from the money and revenue received from the fees charged and rental received for the use of the condominium unit applicable to the series of bonds of which this bond is a part and not from any other fund or source (except to the extent paid from bond proceeds or income from the temporary investment thereof and, under certain circumstances, from condemnation awards, insurance proceeds or proceeds from the sale or other disposition of all or any part of the project). Pursuant to the provisions of the applicable statutes, the governing body of the City has pledged a certain condominium unit as a separate project and the net earnings therefrom to the payment of the series of bonds of which this bond is one and the interest thereon, subject to a certain Condominium Agreement, dated as of January 1, 1978, between United Building of Salina, Inc. and certain occupants of the building which constitutes a part of the project. Reference is hereby made to said Ordinance and the Leases for a description of the condominium unit applicable to the series of bonds of which this bond is one, the covenants of the City with respect to the collection, segregation and application of the revenues derived from the applicable condominium unit and the related project, the nature and extent of the security for the bonds, the rights, duties and obligations of the City and of the Fiscal Agent with respect thereto, and the rights of the holders hereof. Each of the bonds of the series of which this bond is one may be called for redemption and payment prior to maturity in the manner specified in the Ordinance of the City authorizing the issuance of the bonds, on April 1, 1979, or any interest payment date thereafter, at the face amount thereof and interest accrued to the date specified for such redemption. Notice of the intention of the City to redeem and pay any of the bonds of the series of bonds of which this bond - 10 - 1 is one, at any time other than the time such bonds are to be paid and redeemed from the funds to be deposited in the Principal and Income Account maintained for such series pursuant to any of the redemption provisions aforesaid, specifying the numbers of the bonds to be redeemed and paid, shall be given by certified or registered United States Mail or by delivery in person to the Paying Agent herein named, not less than twenty days prior to the date fixed for such redemption and payment, in accordance with Section 3 of said Ordinance. No notice of redemption and payment is necessary with respect to any bonds paid on the maturity date speci- fied for such bond in Section 3 of said Ordinance. AND IT IS HEREBY DECLARED AND CERTIFIED that all acts, conditions and things required to be done and to exist precedent to and in the issuance of this bond have been properly done and performed and do exist in due and regular form and manner as required by the Constitution and laws of the State of Kansas. IN WITNESS WHEREOF, The City of Salina, Kansas, by its governing body, has caused this bond to be signed by the facsimile signature of its Mayor and attested by the facsimile signature of its City Clerk, and its corporate seal to be hereto affixed and the interest coupons hereto attached to be signed with the facsimile signatures of said officers, and this bond to be issued as of the lst day of October, 1978. Attest: (facsimile) City Clerk Mayor facsimile STATE OF KANSAS ) ) ss COUNTY OF SALINE ) The undersigned, the City Clerk of the City of Salina, Kansas, hereby certifies that the within Bond, of the City of Salina, Kansas, has been duly registered in my office according to law. WITNESS my hand and official seal this day of 19 City Clerk (FORM OF COUPON) Series Coupon No. Unless previously called for prior redemption and payment thereof duly made or provided for, on the first day of , 19 , the City of Salina, Kansas, will pay bearer, solely and only from the money and revenue received from the fees charged and rental received for the use of the project described in the bond to which the coupon is attached, and not from April 1, 19 October 1, 19 City of Salina, Kansas United Building of Salina any other fund or source, [amount of ) Industrial interest payable by the coupon] in ) Revenue Bond of 1978 lawful money of the United States of ) America, at the main office of ) Series The Planters State Bank - 12 - and Trust Company, in the City of Salina, Kansas, being six months' interest on its Salina, Kansas, United Building of Salina Industrial Revenue Bond of 1978, dated October 1, 1978, Series Series Coupon No. (facsimile) Mayor Attest: (facsimile) City Clerk - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - The interest rate to be specified in Bonds numbered 1 to 22, inclusive, for Series A, B, C, D, F, H and I, and the interest rate to be specified in Bonds numbered 12 to 22, inclusive, for Series E and G shall be 612%, and the amount of interest evidenced by each coupon attached thereto shall be the sum of $162.50; and the interest rate to be specified in Bonds numbered 1 to 11, inclusive, for Series E and G shall be 512% and the amount of interest evidenced by each coupon attached thereto shall be the sum of $137.50. Each bond of each series shall have attached thereto only such coupons as will become due and payable on or before the maturity date specified for such bond in Section 3 hereof, notwithstanding the later maturity date which may be desig- nated in said bond, and all subsequent coupons shall be detached prior to the issuance and delivery of the bond to the purchaser thereof. - 13 - SECTION 6. The Mayor and City Clerk are hereby autho- rized and directed to prepare and execute in the manner hereinbefore specified each series of the Salina, Kansas, United Building of Salina Industrial Revenue Bonds of 1978 herein authorized and to sell and deliver each series of said bonds to the buyer or buyers thereof, and to pay the proceeds from the sale thereof to the Fiscal Agent herein- after designated to be deposited in the United Building of Salina Construction Fund (Construction Fund) and disbursed by the Fiscal Agent for the purposes set forth in Article III and Article IV of the Leases dated as of October 1, 1978, for the acquisition of the condominium units and the real estate and common areas applicable thereto as set forth in Section 1 of this Ordinance, the reconstruction, repair, enlargement, remodeling and improvement of the condominium units and the acquisition and installation of machinery and equipment therein as fully set forth in the Leases dated as of October 1, 1978. Any funds not required for said purposes shall be deposited by the Fiscal Agent in the Principal and Interest Account referred to in Section 7 of this Ordinance for each series of bonds upon completion of the project as set forth in the Leases and as set forth herein. SECTION 7. There is hereby authorized and ordered to be established in the hands of the Fiscal Agent separate sinking funds for each series of bonds to be designated as the "City of Salina, Kansas, Principal and Interest Account for United Building of Salina Industrial Revenue Bonds of 1978, dated October 1, 1978, Series " (hereinafter referred to as "Principal and Interest Account"). In addi- tion, there is hereby authorized and ordered to be estab- lished in the hands of the Fiscal Agent separate accounts for each series of bonds to be designated as "City of - 14 - SECTION 8. The City covenants and agrees that from and after the delivery of the revenue bonds herein authorized and so long as the bonds of a series shall remain outstanding the City will maintain the Principal and Interest Account and the Revenue Account referred to in Section 7 for such series. To the extent that such informa- tion shall be made known to the City under the terms of this Section 8 of this Ordinance, 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 of the bonds of each series issued hereunder and believed to be held by each of such last known holders. The holder of any bond of any series may request that his name and address be placed on the list for such series of bonds by filing a written request with the Fiscal Agent, which request shall include a statement of the principal amount, the series and the number of the bonds held by such holder. The City and the Fiscal Agent shall be under no responsibility with regard to the accuracy of any such list. At reasonable times and under reasonable regulations established by the Fiscal Agent, the list for each series of bonds may be inspected and copied by the holders of 25% or more in principal amount of the bonds of such series then outstanding, or their representatives, or by the Lessee designated in the Lease applicable to such - 15 - Salina, Kansas, Revenue Account for United Building of Salina Industrial Revenue Bonds of 1978, dated October 1, 1978, Series If (hereinafter referred to as "Revenue Account"'. Each such Principal and Interest Account and each such Revenue Account shall be identified by the letter of the series of bonds applicable thereto as set forth in Section 3 hereof. SECTION 8. The City covenants and agrees that from and after the delivery of the revenue bonds herein authorized and so long as the bonds of a series shall remain outstanding the City will maintain the Principal and Interest Account and the Revenue Account referred to in Section 7 for such series. To the extent that such informa- tion shall be made known to the City under the terms of this Section 8 of this Ordinance, 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 of the bonds of each series issued hereunder and believed to be held by each of such last known holders. The holder of any bond of any series may request that his name and address be placed on the list for such series of bonds by filing a written request with the Fiscal Agent, which request shall include a statement of the principal amount, the series and the number of the bonds held by such holder. The City and the Fiscal Agent shall be under no responsibility with regard to the accuracy of any such list. At reasonable times and under reasonable regulations established by the Fiscal Agent, the list for each series of bonds may be inspected and copied by the holders of 25% or more in principal amount of the bonds of such series then outstanding, or their representatives, or by the Lessee designated in the Lease applicable to such - 15 - series as set forth in Section 16, or such Lessee's repre- sentatives, with any such ownership or authority of any designated representative to be evidenced to the satisfac- tion of the Fiscal Agent. SECTION 9. So long as any of the bonds of any series herein authorized remain outstanding and unpaid, the City shall deposit in the Principal and Interest Account of the Fiscal Agent for such series all payments of rents received under the Lease from the Lessee of the condominium unit applicable to such series of bonds as defined in Section 2 and Section 16 of this Ordinance, semi-annually, on the 1st day of April and the lst day of October of each year, amounts as may be necessary to pay the principal of the bonds which are due on such payment date, as set forth in Article II of the Leases dated as of October 1, 1978, and as set forth in Section 3 of this Ordinance. All amounts credited to and deposited in the Principal and Interest Account for each series of bonds shall be expended and used for the sole purpose of paying the principal and interest of such series of bonds as the same become due. SECTION 10. So long as any of the bonds of any series herein authorized remain outstanding and unpaid, the City shall deposit in the Revenue Account of the Fiscal Agent for such series all amounts received under the Lease from the Lessee of the condominium unit applicable to such series of bonds as set forth in Section 2 and Section 16 of this - 16 - commencing April 1, 1979, the amount of the basic rent payable under the terms of the Lease dated as of October 1, 1978, applicable to such condominium unit, in an amount equal to (a) the interest due on the applicable series of bonds on such interest payment date, and (b) such additional amounts as may be necessary to pay the principal of the bonds which are due on such payment date, as set forth in Article II of the Leases dated as of October 1, 1978, and as set forth in Section 3 of this Ordinance. All amounts credited to and deposited in the Principal and Interest Account for each series of bonds shall be expended and used for the sole purpose of paying the principal and interest of such series of bonds as the same become due. SECTION 10. So long as any of the bonds of any series herein authorized remain outstanding and unpaid, the City shall deposit in the Revenue Account of the Fiscal Agent for such series all amounts received under the Lease from the Lessee of the condominium unit applicable to such series of bonds as set forth in Section 2 and Section 16 of this - 16 - It Ordinance, from time to time as required, and upon demand of the Fiscal Agent, such amount or amounts of money as may be necessary to pay when due the fees, taxes, insurance premiums and other costs and expenses required to be paid as additional rent under the provisions of Article II of the Lease dated as of October 1, 1978, for the condominium unit which is applicable to such series of bonds. The Fiscal Agent shall make disbursements from funds deposited with it in the Construction Fund to the extent thereof or from funds deposited with it in the Revenue Account for the payment of any expenses incurred by the City in connection with the issuance and sale of the bonds, including but not limited to underwriting expenses, legal fees, expenses of counsel and publication expenses, which expenses shall be paid by the Fiscal Agent as directed by the City or the project manager specified in the Leases dated as of October 1, 1978, and for the payment of all fees, charges and expenses of the Fiscal Agent or the Paying Agent, and for the payment of taxes, assessments, insurance premiums and the like required to be paid from funds received under the Leases dated as of October 1, 1978, as additional rent under the provisions of Article II thereof. All disbursements from the Construction Fund shall be deemed to be equally disbursed for the account of each series of bonds authorized and issued hereunder. All costs and expenses incurred in connection with the issuance and sale of the bonds shall be charged equally against the Revenue Accounts to be maintained for each series of bonds. All other costs and expenses shall be allocated to the Revenue Account of each separate series of bonds in such manner as the Fiscal Agent may determine is necessary in order for such cost or expense to be born by the condominium unit and Lease to which such cost or expense relates. If at any time the Fiscal Agent determines that - 17 - there are more than sufficient funds in the Revenue Account for any series to pay the fees, taxes, premiums and other expenses applicable to such series of bonds for the succeed- ing six months, the amount of such excess may be paid to the Lessee of the Lease dated as of October 1, 1978, which is applicable to such series of bonds, provided that such excess shall not be paid to such Lessee if at such time the Principal and Interest Account for such series of bonds is insufficient to fully pay the interest and principal of the bonds to become due on such series of bonds on the next succeeding payment date in accordance with Section 9 of this Ordinance. payment thereof, and when the bonds of such series become subject to redemption as herein set forth, the City, the Fiscal Agent or the applicable Lessee shall proceed to give notice of such redemption in the manner herein specified, if such notice is required hereunder, and the Fiscal Agent, as Paying Agent, shall use moneys in said account for said purposes. After full payment of any series of bonds and interest thereon, any balance in the Principal and Interest Account for such series of bonds shall be returned to the Lessee of the condominium unit to which such series of bonds is applicable. SECTION 12. Subject to the provisions of Section 22 of this Ordinance, money credited to and deposited in the Construction Fund and moneys credited to and deposited in SECTION 11. When money accumulated in the Principal and Interest Account of a series of bonds shall aggregate an amount sufficient to pay the principal of any bond of such series then outstanding, and all interest accrued on such series of bonds to the next succeeding date fixed for payment thereof, and when the bonds of such series become subject to redemption as herein set forth, the City, the Fiscal Agent or the applicable Lessee shall proceed to give notice of such redemption in the manner herein specified, if such notice is required hereunder, and the Fiscal Agent, as Paying Agent, shall use moneys in said account for said purposes. After full payment of any series of bonds and interest thereon, any balance in the Principal and Interest Account for such series of bonds shall be returned to the Lessee of the condominium unit to which such series of bonds is applicable. SECTION 12. Subject to the provisions of Section 22 of this Ordinance, money credited to and deposited in the Construction Fund and moneys credited to and deposited in each of the Principal and Interest Accounts may be invested by the Fiscal Agent in savings accounts and certificates of deposit of the Fiscal Agent or others or in direct obliga- tions of the United States Government becoming due not later than the date funds in the Construction Fund are to be disbursed or not later than ten days prior to the next interest payment date with respect to funds in any such Principal and Interest Account. No investment shall be made hereunder for a longer period of time than the Fiscal Agent determines is reasonably necessary or required for the purpose for which they are intended. All interest on any bonds or other investments held in the Construction Fund or in any Principal and Interest Account shall accrue to and become a part of such respective fund or account. SECTION 13. So long as any of the principal of and interest on a series of bonds herein authorized remain outstanding and unpaid, the City covenants with each of the purchasers and owners of such series of bonds as follows: (a) The City will comply fully with all the terms, provisions and conditions of the Lease for the condominium unit applicable to such series of bonds to the extent it requires performance by or imposes duties on the City and it will not permit any default to occur on the part of the City; that it will fully and promptly enforce, and permit the Fiscal Agent to enforce on its behalf and on behalf of the holders of such series of bonds, all of the terms, provisions and conditions of the Lease of the condominium unit to which such series of bonds is applicable; and in the event of the occurrence of a default as defined in such Lease, then it will exercise, and permit the Fiscal Agent to exercise on its behalf and on behalf of the holders of the - 19 - (b) The City will enforce, and will permit the Fiscal Agent to enforce on its behalf and on behalf of the holders of each series of bonds, collection of the rental payments and other charges in the amounts and at the times set forth in the applicable Leases dated as of October 1, 1978, and will not reduce or cause or permit to be reduced the rental payments and other charges fixed, established and required by each of the Leases nor change or alter the time or times when the same are due and payable under the applicable Leases. The obligation of the City to pay the expenses of such enforcement shall be limited to funds made available to it for that purpose by the bondholders or other interested parties. - 20 - bonds of the series to which such Lease is applicable, all rights and remedies conferred by the Lease for the full and complete protection of the security and the rights of the holders of the bonds of such series, and, to the extent permitted by the applicable Lease, will use its best efforts to procure a new tenant or tenants for such condominium unit that is in default under the provisions of the applicable Lease which will provide funds sufficient in amount to make the rental payments and other charges which the defaulting Lessee is required to make under the Lease dated as of October 1, 1978. If the City is unable to procure a new tenant who will enter into such a lease or sublease, the City shall transfer and convey the applicable condominium unit to the holders of the bonds of such series of bonds which are in default, without any right of redemption, in the same proportions that such series of bonds are then owned and held by them, and the City shall be under no further obligation hereunder. (b) The City will enforce, and will permit the Fiscal Agent to enforce on its behalf and on behalf of the holders of each series of bonds, collection of the rental payments and other charges in the amounts and at the times set forth in the applicable Leases dated as of October 1, 1978, and will not reduce or cause or permit to be reduced the rental payments and other charges fixed, established and required by each of the Leases nor change or alter the time or times when the same are due and payable under the applicable Leases. The obligation of the City to pay the expenses of such enforcement shall be limited to funds made available to it for that purpose by the bondholders or other interested parties. - 20 - (c) Until payment of all of the bonds of each series and interest thereon has been duly made or provided for, the City will not consent to any change, amendment, modification or termination of the Lease covering the office space which is applicable to such series of bonds, except as provided therein, which will in any manner adversely affect the rights, remedies, security or interest of the holders of the bonds of such series. - 21 - (d) Any purchase price of the leased property received by the City pursuant to the termination of any Lease, any proceeds of condemnation awards, any insurance proceeds and any other funds received by the City and intended for the payment of the bonds of any series and the interest thereon will be used solely and exclusively to pay the bonds of such series and the interest thereon according to their terms or to redeem and pay any of the bonds of such series then outstanding and unpaid and then subject to redemption and payment. Upon receipt of any such funds, if the bonds of the series to which such funds relate are then subject to redemption and payment, the City shall proceed promptly to call the bonds of such series for redemption and payment according to their terms and shall cause notice thereof to be given as required in this Ordinance. Such funds shall be deposited in the Principal and Interest Account maintained by the Fiscal Agent for such series of bonds, and the same shall be used solely for the payment of the bonds of such series, accrued interest thereon and the charges of the Fiscal Agent for paying the same, and after full payment of such amounts, the balance of such funds, if any, be shall allocated and credited to the Revenue Account maintained for such series of bonds. - 21 - (e) The City will not issue any other obligations payable from payments to be made pursuant to the Leases described in Section 16 hereof or any sublease thereof, nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance, or any other charge on said payments or on the property subject to the respective Leases nor will it sell or otherwise dispose of the project or any part thereof, unless required by law or required by the terms of the applicable Lease. (f) The City will use the proceeds of each series of bonds as soon as practicable and with all reasonable dispatch for the purposes for which such series of bonds are issued as hereinbefore set forth. Said proceeds shall not be invested in any securities or obligations except for the temporary period pending such use and said proceeds will not be used directly or indirectly so as to cause all or any part of such series of bonds to be or become "arbitrage bonds" within the meaning of Section 103(c) of the Internal Revenue Code of 1954, as amended. The City further cove- nants that the proceeds of each series of bonds will not be used to acquire securities or obligations (other than obligations described in Section 103(a)(1) of the Internal Revenue Code of 1954, as amended] that will produce a yield higher than the yield of the bonds of such series herein authorized unless a regulation of the Treasury Department of the United States, ruling by the Internal Revenue Service of the United States or a decision of a Court of ultimate jurisdiction holds the acquisition of securities or obliga- tions producing a yield higher than the bonds of such series will not cause the bonds to be arbitrage bonds as defined in said Section 103(c) of the Internal Revenue Code of 1954, as amended. - 22 - SECTION 14. The provisions of each series of 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 holders of not less than seventy-five per cent (75%) in aggregate principal amount of the bonds of such series 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 of such series issued hereunder, or the extension of the maturity of any interest on any bonds of such series issued hereunder; (b) the reduc- tion in the principal amount of any bonds of such series or the rate of interest thereon, or (c) the reduction in the aggregate principal amount of such series of bonds, the consent of the holders of all of such series of bonds then outstanding being required for any such amendment or modification. Any provision of any series 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 of such series then outstanding. Every amend- ment or modification of a provision of any series of the bonds or of this Ordinance to which the written consent of the bondholders is given as above provided shall be expressed in an ordinance of the City amending or supple- menting the provisions of this Ordinance and shall be deemed to be a part of this Ordinance. It shall not be necessary to note on any of the outstanding series of bonds any reference to any such amendment or modification. A certi- fied copy of every such amendatory or supplemental ordinance, and a certified copy of this Ordinance shall always be kept on file in the office of the City Clerk and the Fiscal Agent and shall be made available for inspection by the holder or prospective purchaser or holder of any bond - 23 - 1 [J 1 authorized by this Ordinance, and upon payment 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 or the Fiscal Agent to any such bondholder or prospective bondholder. SECTION 15. The provisions of this Ordinance shall constitute a contract between the City of Salina, Kansas, and the holders of each series of the revenue bonds herein authorized, and the holder of any one or more of said bonds may sue, in any action, in mandamus, injuction, 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. Nothing contained in this Ordinance shall, however, be construed to impose on the City any duty or obligation to levy any taxes either to meet any obligation contained herein or to pay the principal of or interest on any series of the revenue bonds of the City herein authorized. SECTION 16. The condominium units described in Section 2 hereof shall be leased to certain occupants under and pursuant to certain Leases dated as of October 1, 1978, substantially in the form attached hereto and made a part hereof and marked Exhibits "A" through "I", inclusive, each of which Leases the Mayor and City Clerk are hereby autho- rized and directed to execute for and on behalf of and as the act and deed of the City. The occupants and Lessees of the several condominium units are as follows: Condominium Units Office Spaces 2, 3 and 4 Occupant and Lessee K & C, Inc., a Kansas corporation with its principal place of business at Salina, Kansas - 24 - Office Space Rakin Land & Cattle Company, 5 a partnership with its principal place of business at Salina, Kansas Office Spaces MarketAide, a partnership with 6 and 8 its principal place of business at Salina, Kansas Office Space Kennedy, Berkley, Simpson and 7 Yarnevich, Chartered, a Kansas professional corporation with its principal place of business at Salina, Kansas Office Spaces Hampton, Royce, Engleman & 9 and 10 Nelson, a partnership with its principal place of business at Salina, Kansas Each of said Leases and the series of bonds applicable to each of said Leases are subject to the terms of the Condo- minium Declaration. References herein to an occupant or Lessee shall be deemed to include the occupant or Lessee named herein and its successors or assigns. SECTION 17. The City hereby designates The Planters State Bank and Trust Company, a Kansas banking corporation with its principal place of business in the City of Salina, Kansas, as the City's fiscal agent, herein referred to as the "Fiscal Agent". Prior to receipt of the proceeds from the issuance of the bonds as herein set forth, the Fiscal Agent shall file with the City Clerk its written acceptance of the duties specified in this Ordinance and each of the Leases and its agreement to act in said capacity. The duties and responsibilities of the Fiscal Agent shall be limited to those expressly set forth in this Ordinance and - 25 - under the several Leases. All resolutions, opinions, certificates and other instruments referred to or provided for herein or in the Leases 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 - 25 - reasonably taken pursuant thereto. The Fiscal Agent shall be under a duty to examine any such resolution, opinion, certificate or other instrument to determine whether or not it conforms to the requirements of this Ordinance and the Leases. 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 any Lessee under days nor more than ninety days after the date of delivery of such written statement, whereupon the City with the consent of the Lessees shall immediately, in writing, designate a successor fiscal agent. Such successor fiscal agent shall be a bank, trust company or national banking association - 26 - the terms of any one or more of the Leases. The Fiscal Agent shall not be liable for any error of judgment made in good faith unless it shall be established that the Fiscal Agent was negligent in ascertaining the pertinent facts. Nothing herein shall be construed to relieve the Fiscal Agent from liability for its own negligent action, its own negligent failure to act or its willful misconduct. The Fiscal Agent shall have the right to buy, sell, own, deal or trade in any series of the bonds or the coupons relating thereto for its own account or for the account of others without giving notice thereof to the City or any bondholder or the Lessee to which such series of bonds is applicable and without incurring any liability whatsoever with respect thereto; and the Fiscal Agent shall have the right to loan money to the City or any bondholder or any Lessee upon such terms and conditions as it deems advisable, without incurring any liability whatsoever with respect thereto on account of its acting as Fiscal Agent hereunder. The Fiscal Agent may resign by an instrument in writing delivered to the City and the Lessees to take effect not less than thirty days nor more than ninety days after the date of delivery of such written statement, whereupon the City with the consent of the Lessees shall immediately, in writing, designate a successor fiscal agent. Such successor fiscal agent shall be a bank, trust company or national banking association - 26 - which has capital stock and surplus aggregating at least that of the Fiscal Agent at the time of its designation hereunder. 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 Ordi- nance and in each of the Leases for the Fiscal Agent. Any such successor fiscal agent shall file an acceptance in the form referred to herein with the City Clerk within ten days of its appointment. 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 Lessees under the Leases as additional rent as specified in Article II of each of said Leases. - 27 - SECTION 18. The City of Salina, Kansas, shall have the right, if it shall find it desirable, to refund any series of the revenue bonds herein authorized then subject to redemption or becoming due hereunder or under the provisions of any law then available. Said bonds or any part thereof may be refunded and the refunding bonds so issued shall enjoy complete equality of pledge with the applicable series of bonds issued hereunder, which are not refunded, if any there be, upon the revenues of the portion of the project applicable to such series of bonds, provided, however, that if only a portion of the bonds of any series herein autho- rized shall be refunded and if said bonds are refunded in such manner that the refunding bonds bear a higher rate of interest or become due on a date earlier than that of any of the bonds of such series issued hereunder which are not refunded, then the bonds of such series may be refunded only - 27 - 1 1 by and with the written consent of the holders of seventy- five per cent (75%) of the bonds of such series herein authorized which are not refunded. SECTION 19. If any one or more of the covenants, agreements or provisions of this Ordinance or of any of the Leases dated as of October 1, 1978, should be held contrary to any express provisions 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, and shall in no way affect the validity of the other provisions of this Ordinance or of the bonds or coupons issued hereunder or of the Leases. SECTION 20. The bonds are being issued under the condition that the Leases provide for a payment in lieu of taxes which will be equal to the taxes imposed were the property not exempt from taxation under the provisions of K.S.A. 79-201a. SECTION 21. Upon receipt by the City of the purchase price for a condominium unit subject to a Lease, then title to such condominium unit shall be transferred and conveyed to the Lessee designated in such Lease or its successors and assigns, as provided in the applicable Lease, and the Mayor, the City Clerk and other appropriate officers of the City are hereby authorized and directed to execute such deeds, bills of sale and other instruments as may be necessary to effect such conveyance and transfer. EW -111M I . . SECTION 22. The City hereby certifies that, on the basis of the facts, estimates and circumstances in existence on the date hereof, it is not expected that the proceeds of the issue of any series of the Salina, Kansas, United Building of Salina Industrial Revenue Bonds of 1978, will be used in a manner which would cause such obligations to be "arbitrage bonds" within the meaning of Section 103(c) of the Internal Revenue Code of 1954, as amended, and the Mayor and City Clerk are hereby authorized and directed to execute an Arbitrage Certificate which shall set forth the facts, estimates and circumstances in brief and summary terms, and state that to the best of their knowledge and belief there are no other facts, estimates or circumstances that would materially change such expectation. The Mayor and City Clerk shall furnish such Arbitrage Certificate to the Lessee of each condominium unit, the Fiscal Agent and the holder of any series of the bonds authorized herein. SECTION 23. The bonds are issued on the condition that the purchasers of each series of the bonds have or shall prior to the issuance thereof represent and certify that: (a) The bonds to be acquired by the purchaser are acquired for investment purposes only and not for resale or further distribution and such bonds shall not be offered for resale in a public offering without obtaining the prior written consent of the Lessee to which such series of bonds is applicable or an opinion of counsel acceptable to such Lessee. At the time of the execution and delivery of each bond, the purchaser thereof shall certify that it has no present intention, agreement or arrangement for distribu- tion, transfer, assignment, resale or division of its interest in such bond in a manner inconsistent with the provisions hereof. - 29 - (b) All materials and information requested by the purchaser or its counsel or others representing its inter- ests, including any information requested to verify any such information furnished, has been furnished and there has been direct communication between the Lessee of the condominium unit to which such series of bonds is applicable and its representatives on the one hand and the purchaser of such bond and its representatives and advisers on the other hand in connection with all of the information furnished here- under and otherwise requested and the terms of the acquisi- tion of the bond from the City as set forth herein. There has been made available to the satisfaction of the purchaser and its advisers adequate opportunity to ask questions of and receive answers from the Lessee of the condominium unit to which such series of bonds relates, and its officers and employees and representatives thereof concerning the terms and conditions of such series of bonds to obtain all addi- tional information desired or necessary to verify the accuracy of the information furnished. (c) The City shall be released from any requirement, duty, obligation or committment, express or implied, to furnish the purchaser or any subsequent holder of the bond of any series any financial information concerning the Lessee of the condominium unit to which such series of bonds is applicable or to investigate and furnish such purchaser or any subsequent holder with any information concerning the financial status of such Lessee. Each purchaser shall represent that it is relying upon its own resources and expertise to obtain and evaluate all such information. SECTION 24. The officials of the City and the attor- neys, engineers and other agents or employees of the City - 30 - A are hereby authorized to do all acts and things required of them by this Ordinance and the Leases for the full, punctual and complete performance of all of the terms, covenants and agreements contained in the bonds, the Leases and this Ordinance. SECTION 25. This Ordinance shall take effect and be in force from and after its passage and publication in the official City paper. PASSED by the Governing Body of the �ity of Salina, Kansas, this day of ,%1978. Jack ' Attest: D. L. Harrison, City Clerk APPROVED by the Mayor this 1978. Jack Attest: -z�— D. L. Harrison, City Clerk - 31 - ei.sger, r, Mayor _ day of , fF isg er, Mayor