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8513 IRB General Battery1 1 �c,l�`shcd tem be-+ 231 t "1 ORDINANCE NO. OF THE CITY OF SALINA, KANSAS AUTHORIZING THE ISSUANCE OF $7,000,000 PRINCIPAL AMOUNT OF INDUSTRIAL REVENUE BONDS (GENERAL BATTERY CORPORATION PROJECT), SERIES B 0 August 31, 1976 - 5 1 1 Recitals Section 1. Section 2. Section 3. Section 4. Section 5. Section 6. Section 7. Section 8. Section 9. Section Section Section Section Section Section Section Section Section Section Section Section '^oction Section Section Section 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. Schedule 1 ORDINANCE NO. OF THE CITY OF SALINA, KANSAS INDEX ------------------------------------------- Authority to Acquire Real Property and to Construct and Purchase the Facility --------- Authorization of and Security for the Bonds - Description and Details of the Bonds, Desig- nation of Paying Agent and Bond Registrar --- Redemption or Prepayment of Bonds Prior to Maturity------------------------------------ Notice of Redemption and Payment ------------ Registration Provisions, Restrictions on Transfer, Persons Treated as Owners --------- Method of Execution of Bonds ---------------- Form of Bond -------------------------------- Execution and Delivery of the Bonds, Deposit of Bond Proceeds, Designation of Fiscal Agent--------------------------------------- Acquisition Fund ---------------------------- Principal and Interest Account -------------- Covenant to Redeem Bonds-------------------- Investments--------------------------------- Particular Covenants of the City------------ Amendments---------------------------------- Enforcement--------------------------------- Declaration of Maturity of Bonds in the Event of Default---------------------------- Defeasance---------------------------------- List of Bondholders ------------------------- Provisions Relating to the Fiscal Agent ----- Authorization of Lease ---------------------- Acceptance of the Guaranty Agreement-------- Severability-------------------------------- Conveyance of Facility ----------------------- Effective Date ------------------------------ Page 1 1 2 3 5 8 9 11 12 23 23 23 24 25 25 30 31 32 32 33 34 38 3u 38 38 39 J 1 1 ORDINANCE NO. gam/ AN ORDINANCE AUTHORIZING THE CITY OF SALINA, KANSAS, TO ACQUIRE THE REAL PROPERTY HEREINAFTER DESCRIBED AND TO CONSTRUCT AND PURCHASE BUILDINGS, IMPROVEMENTS, FIXTURES, MACHINERY AND EQUIP- MENT TO BE LEASED TO GENERAL BATTERY CORPORATION, AUTHORIZING AND DIRECTING THE ISSUANCE OF $7,000,000 PRINCIPAL AMOUNT OF INDUSTRIAL REVENUE BONDS (GENERAL BATTERY CORPORATION PROJECT), SERIES B, OF SAID CITY FOR THE PURPOSE OF PROVIDING FUNDS TO PAY THE COST OF ACQUIRING REAL PROPERTY AND TO CONSTRUCT AND PURCHASE BUILDINGS, IMPROVEMENTS, FIXTURES, MACHINERY AND EQUIP- MENT TO BE LEASED TO GENERAL BATTERY CORPORATION, PRESCRIBING THE FORM AND AUTHORIZING THE EXECUTION OF A LEASE BY AND BETWEEN SAID CITY AND SAID COMPANY. WHEREAS, the City of Salina, Kansas, hereinafter some- times 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 12-1749, as amended, 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 be authorized and issued, for the purpose of providing funds to pay the cost of acquiring real property and to construct and pur- chase buildings, improvements, fixtures, machinery and equipment to be leased to General Battery Corporation, a New York corpora- tion, qualified to do business in Kansas, hereinafter sometimes referred to as the "Company"; NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF SALINA, KANSAS: Section 1. Authority to Acquire Real Property and to Construct and Purchase the Facility. The City of Salina, Kansas, is hereby authorized to acquire the real property described and set forth in Schedule 1 attached hereto and made a part hereof and to purchase buildings, improvements, fixtures, machinery and equipment described in said Schedule 1, said real property, buildings, improvements, fixtures, machinery and equipment being sometimes hereinafter described as the "Facility", in accordance with the provisions of the Lease dated as of September 1 1976, between said City and said General Battery Corporation, hereinafter sometimes referred to as the "Lease", said Lease being authorized by the provisions of this Ordinance (said real property being referred to in the Lease as the "Land" and said Land, build- ings, improvements, fixtures, machinery and equipment also being referred to in the Lease as the "Facility") all at an amount which will not exceed the cost of $7,000,000 to said City. Section 2. Authorization of and Security for the Bonds. For the purpose of providing funds to pay the cost of acquiring the real property described in said Schedule 1 and to construct and purchase buildings, improvements, fixtures, machinery and equipment to be leased to General Battery Corporation, a New York corporation, there shall be issued and hereby are authorized and directed to be issued a series of Industrial Revenue Bonds (General Battery Corporation Project), Series B, of the City of Salina, Kansas, in the principal amount of $7,000,000. Said Bonds herein authorized, hereinafter sometimes referred to as the "Bonds", and all interest thereon shall be paid solely from the money and reve- nue received from the fees charged and rental received for the use of the Facility and not from any other fund or source of the City. 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 and Bond Registrar. Said Industrial Revenue Bonds (General Battery Corporation Project), Series B, of the City of Salina, Kansas, shall be dated September 1, 1976, and shall be issued as Bond No. 1 in the principal amount of $6,300,000, bearing interest on the balance of such principal -2- amount from time to time remaining unpaid at the rate of eight and one-half percent (8 1/2%) per annum and Bond No. 2 in the principal amount of $700,000 bearing interest on the balance of such principal amount from time to time remaining unpaid at the rate of nine and three-quarters percent (9 3/4%) per annum and such other Bonds as may be issued as a result of the transfer or exchange of Bond No. 1, Bond No. 2 or such other Bonds as provided in Section 6 hereof. The Bonds shall bear interest from their effective date of registration, which date shall be set forth on the reverse face of each such Bond, such date of registration to be as of the interest payment date next preceding the date of its authentication, unless authentication shall be upon an interest payment date, in which case the effective date of registration shall be as of the date of its authentication, or unless authentication shall precede the first interest payment date for such Bonds, in which case the effective date of registration shall be September 1, 1976. Interest shall be payable semiannually, beginning March 1, 1977. Bond No. 1 shall mature in semiannual installments of principal as follows: Amount of Principal Installment Due on Year March 1 September 1 1977 $57,054.00 $59,478.79 1978 62,006.64 64,641.93 1979 67,389.21 70,253.25 1980 73,239.01 76,351.67 1981 79,596.62 82,979.47 1982 86,506.10 90,182.61 1983 94,015.37 98,011.02 1984 102,176.49 106,518.99 1985 111,046.05 115,765.51 1986 120,685.54 125,814.68 1987 131,161.80 136,736.18 1983 142,547.46 148,605.73 1989 154,921.48 161,505.64 1990 168,369.63 175,525.34 1991 182,985.16 190,762.13 1992 96,956.42 101,077.07 1993 105,372.85 109,851.19 1994 114,519.87 119,386.96 1995 124,460.91 129,750.50 1996 135,264.89 141,013.65 1997 147,006.73 153,254.52 1998 159,767.84 166,557.97 1999 173,636.68 181,016.24 2000 188,709.43 196,729.58 2001 205,090.59 213,742.61 =15 Bond No. 2 shall mature in semiannual installments of principal as follows: Said Bonds shall be fully registered Bonds without coupons as hereinafter provided. Said Bonds and the interest and premium, if any, thereon shall be payable in lawful money of the United States of America at The First National Bank and Trust Company of Salina, in the City of Salina, Kansas, hereby designated as the City's paying agent for the payment of the prin- cipal of and interest on the Bonds and hereinafter designated as the City's bond registrar for all Bonds and hereinafter referred to as the "Bond Registrar". The term "Paying Agent" as used in this Ordinance shall include said The First National Bank and Trust Company of Salina, as Bond Registrar when acting as Paying Agent for the Bonds. In lieu of any such payment at the offices of the Paying Agent as set forth above, such payment may be made by check or draft mailed by first class mail, or by transfer of monies by wire, to any bondholder or to any bank for the -4- Amount of Principal Installment Due on Year March 1 ep e er 1977 $ 5,459.00 $ 5,725.12 1978 6,004.23 6,296.93 1979 6,603.91 6,925.84 1980 7,263.48 7,617.57 1981 7,988.93 8,378.39 1982 8,786.84 9,215.20 1983 9,664.44 10,135.58 1984 10,629.69 11,147.89 1985 11,691.35 12,261.30 1986 12,859.04 13,485.92 1987 14,143.36 14,832.85 1988 15,555.95 16,314.30 1989 17,109.62 17,943.72 1990 18,818.47 19,735.88 1991 20,697.99 21,656.30 1992 10,577.77 11,093.43 1993 11,634.24 12,201.41 1994 12,796.23 13,420.04 1995 14,074.27 14,760.39 1996 15,479.96 16,234.61 1997 17,026.05 17,856.07 1998 18,726.55 19,639.47 1999 20,596.89 21,600.99 2000 22,654.04 23,758.42 2001 24,916.65 26,003.43 Said Bonds shall be fully registered Bonds without coupons as hereinafter provided. Said Bonds and the interest and premium, if any, thereon shall be payable in lawful money of the United States of America at The First National Bank and Trust Company of Salina, in the City of Salina, Kansas, hereby designated as the City's paying agent for the payment of the prin- cipal of and interest on the Bonds and hereinafter designated as the City's bond registrar for all Bonds and hereinafter referred to as the "Bond Registrar". The term "Paying Agent" as used in this Ordinance shall include said The First National Bank and Trust Company of Salina, as Bond Registrar when acting as Paying Agent for the Bonds. In lieu of any such payment at the offices of the Paying Agent as set forth above, such payment may be made by check or draft mailed by first class mail, or by transfer of monies by wire, to any bondholder or to any bank for the -4- account of such bondholder in accordance with written payment instructions filed with the Paying Agent by such bondholder. Section 4. Redemption or Prepayment of Bonds Prior to Maturity. Said Bonds shall not be subject to redemption or prepay- ment, in whole or in part, except as provided in this Section 4. Said Bonds shall be subject to redemption or prepayment, in whole or in part, prior to the stated maturity of principal installments thereof, after the notice specified in Section 5 of this Ordinance, as follows: A. Each of said Bonds shall be subject to redemption and payment at the option of the City, upon instructions from the Company, on any interest payment date upon any of the follow- ing conditions or events, provided all of said Bonds are redeemed and paid according to their terms: (1) if title to, or the use for a limited period of, substantially all of the Facility sub- ject to said Lease be condemned by any authority having the power of eminent domain; (2) if sub- stantially all of the Facility be damaged or destroyed by fire or other casualty; or (3) if as a result of changes in the Constitution of the State of Kansas, or of legislative or administra- tive 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 herein authorized shall become void or un- enforceable, or impossible of performance without unreasonable delay, or in any other way, by reason of such change of circumstances, unreasonable burdens or excessive liabilities are imposed on the Company or the City, or (4) if at any time on or after September 1, 1986, the continued use of -5- the Facility by the Company is uneconomic in the reasonable judgment of the Company's Board of Directors and the Company discontinues its use of the Facility. The redemption price for Bonds redeemed pursuant to this paragraph shall be the principal amount of Bonds so redeemed, plus ac- crued interest thereon to date fixed for redemp- tion and payment, without premium. B. Each of the principal installments on said Bonds shall be subject to prepayment in in- verse chronological order at the option of the City, upon instructions from the Company, in whole or in part, on any principal payment date at the prepayment prices (expressed as percent- ages of the principal amount being prepaid) set out below plus accrued interest thereon to the prepayment date: Prepayment Dates (Inclusive) March 1, 1977 to September 1, 1977 March 1, 1978 to September 1, 1978 March 1, 1979 to September 1, 1979 March 1, 1980 to September 1, 1980 March 1, 1981 to September 1, 1981 March 1, 1982 to Septmeber 1, 1982 March 1, 1983 to September 1, 1983 March 1, 1984 to September 1, 1984 March 1, 1985 to September 1, 1985 March 1, 1986 to September 1, 1986 March 1, 1987 to September 1, 1987 March 1, 1988 to September 1, 1988 March 1, 1989 to September 1, 1989 March 1, 1990 to September 1, 1990 March 1, 1991 to September 1, 1991 March 1, 1992 to September 1, 1992 March 1, 1993 to September 1, 1993 March 1, 1994 to September 1, 1994 March 1, 1995 to September 1, 1995 March 1, 1996 to September 1, 1996 March 1, 1997 to September 1, 1997 March 1, 1998 to September 1, 1998 March 1, 1999 to September 1, 1999 March 1, 2000 and thereafter Prepayment Price Bond No. 1* Bond No. 2** 108.50% 109.75% 108.13% 109.33% 107.76% 108.91% 107.39% 108.49% 107.02% 108.07% 106.65% 107.65% 106.28% 107.23% 105.91% 106.81% 105.54% 106.39% 105.17% 105.97% 104.80% 105.55% 104.43% 105.13% 104.06% 104.71% 103.69% 104.29% 103.32% 103.87% 102.95% 103.45% 102.58% 103.03% 102.21% 102.61% 101.84% 102.19% 101.47% 101.77% 101.10% 101.35% 100.73% 100.93% 100.36% 100.51% 100.00% 100.00% * and any Bond issued as the result of the transfer or exchange of Bond No. 1 or any such Bond **and any Bond issued as the result of the transfer of Bond No. 2 or any such Bond provided, however, that the principal installments (or portions thereof) of the Bonds to be prepaid pursuant to the provisions provided in this paragraph B shall be prepaid pro rata, as nearly and as equitably as practicable, to the holders of the outstanding Bonds, such that the principal amount of Bonds to be prepaid to each holder of a registered Bond shall have, as nearly and as equitably as practicable, the same proportionate relationship to the principal amount of Bonds being prepaid as the outstanding principal amount of Bonds held by such holder bears to the total principal amount of the Bonds at the time outstanding, and provided further that no such optional redemption shall be made from proceeds of, or otherwise in anticipation of, either (i) borrowings having average interest rate lower than the average interest rate on the principal being prepaid or (ii) borrowings having a shorter weighted average life than the then weighted average life of the principal being prepaid. For the purposes of this paragraph (B) "average interest rate" shall be computed by dividing the total interest cost of the borrowings or principal being prepaid, as the case may be, by the amount of such borrowings or principal and "weighted average life" shall be computed by subtracting the amount of such borrowings or such principal, as the case may be, from the total debt service to be paid respecting such borrowings or such prin- cipal and then dividing the resulting amount by an amount equal to one year's interest on such borrowings or such principal. Prior to the date fixed for redemption or prepayment, funds or securities in which such funds are invested shall be placed with the Fiscal Agent to pay the Bonds called for redemption, or the principal installments to be prepaid, and accrued interest thereon to the redemption or prepayment date and the premium, if any. Upon the happening of the above conditions, the Bonds thus -7- called for redemption or the principal installments to be prepaid shall cease to bear interest from and after the redemption or pre- payment date, shall no longer be entitled to the benefits and pro- tection of the covenants herein contained and shall not be deemed to be outstanding hereunder. Section 5. Notice of Redemption or Prepayment. Notice of any redemption or prepayment provided for by this Ordinance shall be given in the name of the City by the City, the Company or the Fiscal Agent by United States registered mail to the owner of each Bond which is to be redeemed or on which a prepayment of prin- cipal is to be made at the address shown on the books maintained by the Bond Registrar and to Goldman, Sachs & Co., New York, New York, such notice to be mailed at least 30 days prior to the date fixed for redemption or prepayment and, in the case of redemption, to specify the numbers of the Bonds to be redeemed or, in the case of prepayment, the numbers of the Bonds on which a prepayment of prin- cipal is to be made, the total amount of such prepayment with respect to each Bond, the principal installments which are to be prepaid, and, if less than all of any principal installment is to be prepaid, the amount of such principal installment to be prepaid; provided that the failure to give any notice by mail as herein specified shall not affect the validity of any such call for redemption or any such notice of prepayment. Interest shall cease on any of said Bonds so called for redemption and any of said principal to be prepaid as of the redemption or prepayment date, provided funds are available to pay the same according to their terms. Notice of any redemption or prepayment as herein provided shall be given upon, but only upon, written instructions from the Company, as long as the Company is not in default in the payment of Basic Rent due under the Lease. -8- Section 6. Registration Provisions, Restrictions on Transfer, Persons Treated as Owners. The City covenants that it will, as long as any of the Bonds herein authorized remain outstand- ing, keep at The First National Bank and Trust Company of Salina, Salina, Kansas, hereby designated as Bond Registrar, books for the registration of Bonds as herein provided. The Bonds shall be made payable to the registered owner as shown on the regis- tration books and may not be registered to bearer. Each Bond shall be transferable only upon the books maintained by the Bond Registrar by the registered owner thereof in person or by his attorney duly authorized in writing, upon surrender thereof together with a written instrument satisfactory to the Bond Registrar duly executed by the registered owner or his duly authorized attorney and, with respect to Bond No. 2 and any Bond issued as a result of the trans- fer of Bond No. 2 or any such Bond, upon satisfaction of the condi- tions set forth in the next paragraph; provided, however, that no transfer may be effected if such transfer would result in a viola- tion of the Lender's Agreement (Form FmHA 449-35) respecting such Bonds between the United States of America acting through the Farmers Home Administration of the Department of Agriculture and The First National Bank and Trust Company of Salina, Salina, Kansas. Upon satisfaction of such conditions, the transfer of any such registered Bond and the payment of any fee, tax or governmental charge the Bond Registrar shall issue in the name of the transferee a new registered Bond in a principal amount equal to the unpaid principal amount of the Bond being transferred, bearing the same interest rate as the Bond being transferred and maturing in installments such that the principal amount payable on such new Bond on each principal payment date is equal to the unpaid principal amount payable on such principal pay- ment date on the Bond being transferred. MN Bond No. 2 and any Bond issued as a result of the transfer of Bond No. 2 or any such Bond shall be transferable only if, in the opinion of counsel satisfactory to the Bond Registrar and the Company, such transfer will not result in a violation of the Securities Act of 1933, as amended from time to time, or other applicable securities laws. Bond No. 1, and any Bonds issued as a result of the exchange or transfer of Bond No. 1 or any such Bonds, upon surrender thereof to the Bond Registrar with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the registered owner or his duly authorized attorney, may, at the option of the registered owner thereof, and upon payment by such registered owner to the Bond Regis- trar of any fee, tax or governmental charge required to be paid, be exchanged for an aggregate principal amount of Bonds equal to the aggregate unpaid principal amount of the Bond or Bonds being exchanged, and in any denomination or denominations and bearing the same interest rate and maturing in installments such that the aggregate principal amount payable on such Bonds on each principal payment date is equal to the aggregate unpaid principal amount payable on such principal payment date on the Bond or Bonds being exchanged; provided, however, that no such exchange may be effected if such exchange would result in a violation of that certain Lender's Agreement (Form FmHA 449-35) respecting such Bonds between the United States of America acting through the Farmer's Home Administration of the Department of Agricul- ture and The First National Bank and Trust Company of Salina, Salina, Kansas. The City, the Bond Registrar, the Paying Agent and the Company may deem and treat the person in whose name any Bond shall be registered as the absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, any principal, prepayment price and redemption price, if any, of and interest on such Bond and for all other purposes, and -10- 1 all such payments so made to any such registered owner or upon his order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the City, nor the Bond Registrar nor the Paying Agent nor the Company shall be affected by any notice to the contrary, but such registration may be changed as herein provided. In all cases in which the privilege of transferring Bonds is exercised, the Bond Registrar shall endorse and deliver Bonds in accordance with the provisions of this Ordinance. All Bonds shall be held by the Bond Registrar pending any further transfer. For every such transfer of Bonds, the Bond Registrar may make a charge to the bondholder sufficient to reimburse it for any tax or other governmental charge required to be paid with respect to such transfer. The fees and charges of the Bond Regis- trar for making any transfer provided for by this Ordinance sub- sequent to the initial issuance of the Bonds and the expense of any Bond printing necessary to effect the first or any subsequent transfer of any Bond shall be paid by the bondholder. Neither the City nor the Bond Registrar shall be required (a) to register or transfer Bonds for a period of 10 days next preceding an interest payment date on the Bonds or the next preceding any selection of Bonds which are to be redeemed or on which a prepayment of principal is to be made, or thereafter until after the first mailing of any notice of redemption or prepayment; or (b) to register or transfer any Bonds which are called for redemption or on which a prepayment of principal is to be made. Section 7. Method of Execution of Bonds. Said Bonds and each of them shall be executed for and on behalf of the City by the facsimile signature of its Mayor and attested by the fac- simile signature of its City Clerk, with the seal of the City -11- 1 Ii affixed. Said Bonds and each of them shall be registered in the office of the City Clerk which registration shall be evidenced by a certificate on the reverse face thereof bearing the manual sig- nature of the City Clerk. In the event either said Mayor or City Clerk or both of said officers shall cease to hold such office before the Bonds bearing their signatures shall have been issued and delivered, said Bonds may be issued as though said officers had not ceased to hold office and such signatures appearing on said Bonds and registration certificates shall be valid and suffi- cient for all purposes as if they had remained in office until such issuance. Section 8. Form of Bond. Each of said Bonds and the certificate attached thereto shall be in substantially the follow- ing form: -12- No. UNITED STATES OF AMERICA STATE OF KANSAS COUNTY OF SALINE CITY OF SALINA INDUSTRIAL REVENUE BOND GENERAL BATTERY CORPORATION PROJECT SERIES B (Under existing statutes and rulings of the Internal Revenue Service, the interest on this Bond is subject to Federal income taxation.) 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, solely out of the reve- nues hereinafter referred to, to the principal of , the registered holder hereof, or registered assigns, DOLLARS in lawful money of the United States of America, on the dates and in- stallments as follows: Amount of Principal Installment Due on Year March 1 September 1 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 -13- except as the provisions hereinafter set forth with respect to re- demption or prepayment prior to maturity may become applicable hereto, and to pay to the registered holder hereof interest from the effective date of registration of this Bond (which date is set forth on the reverse face of this Bond) on the balance of such principal sum from time to time remaining unpaid at the rate of per cent ( %) per annum, payable semi- annually on March 1 and September 1 in each year beginning March 1, 1977, until the said principal sum shall have been paid in full. The principal installments and interest due are payable by check or draft in lawful money of the United States of America at The First National Bank and Trust Company of Salina, (the "Paying Agent"), in the City of Salina, Kansas. In lieu of any such payment at the offices of the Paying Agent, such payment may be made by check or draft sent by first class mail, or by transfer of monies by wire, to any bondholder to a bank for the account of such bondholders in accordance with written instructions filed with the Paying Agent by such bondholder. Payments of principal and interest, including prepayments of installments of principal as hereinafter provided, shall be noted on the books of the Paying Agent and such payment shall fully discharge the obligation of said City to the extent of the payments so made. Upon final payment of principal and interest this Bond shall be submitted to the Paying Agent for can- cellation and surrender to said City. THIS BOND is one of a series of Bonds aggregating the principal amount of $7,000,000 authorized by Ordinance of said City (the "Ordinance") for the purpose of providing funds to pay the cost of acquiring real property and to construct and purchase buildings, improvements, fixtures, machinery and equipment (here- inafter sometimes referred to as the "Facility", said Facility being further identified in the Ordinance) to be leased to General Battery Corporation, a New York corporation (the "Company"), -14- pursuant to a Lease dated as of September 1., 1976 (the "Lease"), by and between said City and said Company, by the authority of and in con- formity with the provisions, restrictions and limitations of the Constitution and statutes of the State of Kansas, including K.S.A. 12-1740 to 12-1749, and all amendlAents thereof and acts supple- mental thereto, and all other provisions of the laws of said State applicable thereto and this Bond and all interest hereon are to be paid by said City of Salina, Kansas, solely and only from the money and revenue received from the fees charged and rental re- ceived for the use of the Facility under said Lease and not from any other fund or source of the City. Pursuant to the provisions of said statute, the governing body of the City has pledged said Facility and the net earnings therefrom to the payment of the series of Bonds of which this Bond is a part and the interest thereon. Reference is hereby made to the Ordinance and to the Lease for a description of the Facility and the covenants of the City and the Company with respect to the payment, collection, segregation and application of the money and revenue received from the fees charged and rental received for the use of said Facility, the rights, duties and obligations of the City and the Company with respect thereto and otherwise 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 prior to maturity on any inter- est payment date at the option of the City upon the following condi- tions or events, provided all of said Bonds are redeemed and paid according to their terms: (1) if title to, or the use for a limited period of, substantially all of the Facility be condemned by any authority having the power of eminent domain; (2) if substantially all of the Facility is damaged or destroyed by fire or other casu- alty; or (3) if as a result of changes in the Constitution of the -15- State of Kansas or of 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 become void or unenforceable or impossi- ble of performance without unreasonable delay, or in any other f way by reason of such change of circumstances, unreasonable burdens or excessive liabilities are imposed on the Company or the City; or (4) if at any time on or after September 1, 1986, the continued use of the Facility by the Company is in the reasonable judgment of the Company's Board of Directors uneconomic and the Company discontinues its use of the Facility. The redemption price for Bonds redeemed pur- suant to this paragraph shall be the principal amount of Bonds so re- deemed, plus accrued interest thereon to and incluidng the date fixed for redemption and payment, without premium. Each of the principal installments on the Bonds of the series of which this Bond is one is subject to prepayment in inverse chronological order at the option of the City, upon instructions from the Company, in whole or in part, on any principal payment date at the prepayment prices (expressed as percentages of the principal amount being prepaid) set out below plus accrued interest thereon to the prepayment date: Prepayment Dates (Inclusive) Prepayment Price March 1, 1977 to September 1, 1977 March 1, 1978 to September 1, 1978 March 1, 1979 to September 1, 1979 March 1, 1980 to September 1, 1980 March 1, 1981 to September 1, 1981 March 1, 1982 to September 1, 1982 March 1, 1983 to September 1, 1983 March 1, 1984 to September 1, 1984 March 1, 1985 to September 1, 1985 March 1, 1986 to September 1, 1986 March 1, 1987 to September 1, 1987 March 1, 1988 to September 1, 1988 March 1, 1989 to September 1, 1989 March 1, 1990 to September 1, 1990 March 1, 1991 to September 1, 1991 March 1, 1992 to September 1, 1992 March 1, 1993 to September 1, 1993 March 1, 1994 to September 1, 1994 March 1, 1995 to September 1, 1995 March 1, 1996 to September 1, 1996 March 1, 1997 to September 1, 1997 March 1, 1998 to September 1, 1998 March 1, 1999 to September 1, 1999 March 1, 2000 and thereafter -16- provided, however, that the principal installments (or portions thereof) of the Bonds to be prepaid pursuant to the provisions provided in this paragraph shall be prepaid pro rata, as nearly and as equitably as practicable, to the holders of the outstanding Bonds, such that the principal amount of Bonds to be prepaid to each holder of a registered Bond shall have, as nearly and as equitably as practicable, the same proportionate relationship to the principal amount of Bonds being pre- paid as the outstanding principal amount of Bonds held by such holder bears to the total principal amount of the Bonds at the time outstand- ing, and provided.further that no such optional redemption shall be made from proceeds of, or otherwise in anticipation of, either (i) borrowing having an average interest rate lower than the average in- terest rate on the principal being prepaid or (ii) borrowings having a shorter weighted average life than the then weighted average life of the principal being prepaid. For the purposes of this paragraph "average interest rate" shall be computed by dividing the total in- terest cost of the borrowings or principal being prepaid, as the case may be, by the amount of such borrowings or principal and "weighted average life" shall be computed by subtracting the amount of such borrowings or such principal, as the case may be, from the total debt service to be paid respecting such borrowings or such principal and then dividing the resulting amount by an amount equal to one year's interest on such borrowings or such principal. All Bonds so called for redemption and all principal to be prepaid will cease to bear interest on the specified redemption or prepayment date provided funds or securities in which such funds are invested for such redemption or prepayment are on deposit with the Paying Agent prior to the redemption or prepayment date and shall no longer be entitled to the benefits and protection of the -17- covenants contained in the Ordinance authorizing this Bond and shall not be deemed to be outstanding under the provisions of said Ordinance. Notice of the City's intention to redeem said Bonds or pre- pay any of said principal installments (or portions thereof) pursuant to any of the redemption or prepayment provisions aforesaid, specify- ing, in the case of redemption, the numbers of the Bonds to be re- deemed or, in the case of prepayment, the numbers of the Bonds on which a prepayment of principal is to be made, the total amount of such prepayment with respect to each Bond, the principal installments which are to be prepaid, and, if less than all of any principal in- stallment is to be prepaid, the amount of such principal installment to be prepaid, shall be given by United States registered mail to the registered owner of each Bond which is to be redeemed or on which a prepayment of principal is to be made at the address shown on the registration books maintained by the Bond Registrar not less than 30 days prior to the date fixed for redemption or prepayment. This Bond is transferable, as provided in the Bond Ordinance only upon the books of the City kept for that purpose at The First National Bank and Trust Company of Salina, Salina, Kansas, as the Bond Registrar, by the registered owner hereof in person, or by his duly authorized attorney, (In Bond No. 2 and any Bond issued as a result of the transfer of Bond No. 2 or any such Bond insert here the following language: "upon satisfaction of the conditions respecting compliance with applicable securities laws set forth above"], surrender of this Bond together with a written instrument of transfer satis- factory. to the Bond Registrar duly executed by the registered owner or his duly authorized attorney, and thereupon a new registered Bond in a principal amount equal to the unpaid principal amount of the Bond being transferred, bearing the same interest rate as the Bond being transferred and maturing in installments such that the principal an M_ amount payable on such new Bond on each principal payment date is equal to the unpaid principal amount payable on such principal payment date on the Bond being transferred shall be issued to the transferee in ex- change therefor as provided in the Ordinance authorizing this Bond, and upon payment of the charges therein prescribed; provided, however, that no such transfer may be effected if such transfer would result in a violation of the Lender's Agreement (Form FmHA 449-35) respecting the Bonds of the series of which this Bond is one between the United States of America acting through the Farmers Home Administration of the Department of Agriculture and The First National Bank and Trust Company of Salina, Salina, Kansas. The City, the Bond Registrar and the Paying Agent may deem and treat the person to whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, any principal, prepayment price or redemption price hereof and interest due hereon and for all other purposes. [In Bond No. 1 and any Bonds issued as a result of the exchange or transfer of Bond No. 1 or any such Bonds insert the following para- graph:] This Bond, upon surrender thereof to the Bond Regis- trar with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the registered owner or his duly authorized attorney, may, at the option of the registered owner thereof, and upon payment by such registered owner to the Bond Registrar of any fee, tax or governmental charge required to be paid, be exchanged for an equal aggregate principal amount of Bonds, in any de- nomination or denominations, bearing the same interest rate and maturing in installments such that the aggregate prin- cipal amount payable on such Bonds on each principal pay- ment date is equal to the aggregate principal amount pay- able on such principal payment date on the Bond or Bonds -19- L7 being exchanged; provided, however, that no such exchange may be effected upon surrender thereof to the Bond Regis- trar with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the registered owner or his duly authorized attorney, may, at the option of the registered owner thereof, and upon payment by such registered owner to the Bond Registrar of any fee, tax or governmental charge required to be paid, be exchanged for an aggregate principal amount of Bonds equal to the aggregate unpaid principal amount of the Bond or Bonds being exchanged, and in any denomination or denominations and bearing the same interest rate and maturing in install- ments such that the aggregate principal amount payble on such Bonds on each principal payment date is equal to the aggregate unpaid principal amount payable on such princi- pal payment date on the Bond or Bonds being exchanged; provided, however, that no such exchange may be effected if such exchange would result in a violation of that cer- tain Lender's Agreement (Form FmHA 449-35) respecting such Bonds between the United States of America acting through the Farmer's Home Administration of the Depart- ment of Agriculture and The First National Bank and Trust Company of Salina, Salina, Kansas. 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 re- quired by the Constitution and laws of the State of Kansas. -20- 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 this Bond to be dated this first day of September, 1976. (facsimile) Mayor ATTEST: (facsimile) City Clerk 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 Boni (General Battery Corporation Project), Series B. dated September 1, 1976, 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 1 1976. -21- City Clerk CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds described in the within men- tioned Ordinance. THE FIRST NATIONAL BANK AND TRUST COMPANY OF SALINA, Salina, Kansas, Bond Registrar By Authorized Officer (FORM TO APPEAR ON REVERSE FACE OF REGISTERED BONDS) The effective date of registration of this Bond is (FORM OF ASSIGNMENT) FOR VALUE RECEIVED, The undersigned sells, assigns and transfers unto the within Industrial Revenue Bond (General Battery Corporation Project), Series B, dated September 1, 1976, of the City of Salina, Kansas, and hereby authorizes the transfer of this Bond on the registration books of the bond registrar. Dated IN THE PRESENCE OF The following legend shall be placed on the face of Bond No. 2 and all Bonds issued as a result of the transfer of Bond No. 2 on such Bonds: This Bond has not been registered under the Securities Act of 1933, as amended, or under any state securities law. In the ab- sence of such registration, this Bond may not be sold, transferred, assigned or otherwise disposed of, unless such transaction will not, in the opinion of counsel satisfactory to the Bond Registrar and the Company (both as defined herein), violate any of said securities laws. -22- Section 9. Execution and Delivery of the Bonds, Deposit of Bond Proceeds, Designation of Fiscal Agent. The Mayor and City Clerk are hereby authorized and directed to prepare and execute, in the manner hereinbefore specified, the Bonds herein authorized, and to deliver said Bonds to the purchasers thereof. The proceeds of said Bonds shall be deposited with The First National Bank and Trust Company of Salina, in the City of Salina, Kansas, hereby designated as the City's Fiscal Agent and herein referred to as the "Fiscal Agent", the rights and duties of said Fiscal Agent being further specified in.Section 20 of this Ordinance. Section 10. Acquisition Fund. There is hereby author- ized and ordered to be established in the hands of the Fiscal Agent a separate fund or account designated as "City of Salina, Kansas, General Battery Corporation Acquisition Fund", herein- after referred to as the "Acquisition Fund". The Fiscal Agent shall, first, promptly pay from the proceeds of the sale of said Bonds into the Principal and Interest Account for Industrial Reve- nue Bonds (General Battery Corporation Project), Series B, dated September 1, 1976, hereinafter created, the amount of any accrued inter- est and premium, if any, received from such sale. The balance of the proceeds of the sale of said Bonds shall be deposited in said Acquisition Fund. Said Acquisition Fund shall be used for the pur- pose of providing funds to pay the cost of acquiring the real prop- erty described in said Schedule 1 and to acquire, construct and pur- chase buildings, improvements, fixtures, machinery and equipment to be leased to General Battery Corporation as provided in said Lease. Any moneys not required for said purpose shall, when the Facility is complete as provided in the Lease, be deposited by the Fiscal Agent in said Principal and Interest Account. Section 11. Principal and Interest Account. There is hereby authorized and ordered to be established in the hands of -23- the Fiscal Agent a separate account to be known as the "City of Salina, Kansas, Principal and Interest Account for Industrial Revenue Bonds (General Battery Corporation Project), Series B, dated September 1, 1976", hereinafter referred to as the "Principal and Interest 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 outstand- ing, said City will maintain said Account with the Fiscal Agent. All payments of Basic Rent and Additional Rent due under said Lease between the City and the Company intended to pay the princi- pal of and interest on the Bonds shall be applied and allocated by the Fiscal Agent to said Principal and Interest Account. All amounts credited to and deposited in said Principal and Interest Account shall be used by the Fiscal Agent and forwarded to the Paying Agent for the sole purpose of paying the principal of and interest on the Revenue Bonds herein authorized as and when the same become due or are called for redemption and payment. Any balance remaining in said Principal and Interest Account, including interest earned on deposits made into said Account as prepayments of rent due under Article II of said Lease, shall, when said Bonds have been paid, or payment provided for, be paid to General Battery Corporation. Section 12. Covenant to Redeem Bonds. When moneys accumulated in said Principal and Interest Account shall aggregate an amount sufficient to pay the principal of all of the Bonds then outstanding, and all interest accrued to date fixed for redemption and payment, and redemption premium, if any, and when said Bonds become subject to redemption, said City shall, upon receipt of instructions from the Company, proceed to give notice of such re- demption in the manner herein specified, and said Fiscal Agent shall use such funds for said purpose. -24- Section 13. Investments. Moneys in the Acquisition Fund shall, upon instructions from the Company, be invested by the Fiscal Agent in direct obligations of the United States Govern- ment, or agencies thereof, or, if permitted by law, obligations of the Fiscal Agent, becoming due within twelve months from the date of purchase. Moneys allocated and credited to and deposited in the Principal and Interest Account in any amount in excess of the amount necessary to pay the amount of principal and interest next becoming due shall be invested by the Fiscal Agent, upon instruc- tions from the Company, in direct obligations of the United States Government, or agencies thereof, becoming due not later than August 31, 2001, or in such other securities which may be authorized from time to time by the laws of the State of Kansas for investment of bond proceeds, including obligations of the Fiscal Agent. No investment shall be made pursuant to this Section for a period longer than the time the Fiscal Agent shall determine that said funds are not required for the purpose for which they are intended. All interest on invest- ments held in the Acquisition Fund shall be deposited in the Principal and Interest Account. Interest on investments in any other fund or account shall accrue to and become a part of such fund or account so invested. Section 14. Particular Covenants of the City. So long as any of the principal of and interest on the Bonds herein author- ized remain outstanding and unpaid, or until provisions are made for the payment thereof, the City covenants with each of the holders and owners of said Bonds as follows: (A) The City will use the proceeds of the series of Bonds herein authorized as soon as practicable and with all reasonable dispatch for the purpose for which said Bonds are issued as hereinbefore set forth. EP&IM (B) The City will comply fully with all the terms, provisions and conditions of the Lease which require performance by, or impose duties on, the City and that it will not permit any default to occur on the part of the City; that it will fully and promptly enforce all of the terms, pro- visions and conditions of the Lease which require performance by, or impose duties on, the Company and in the event of the occurrence of a default, as defined in the Lease, will exercise all rights and remedies conferred by the Lease for the full and complete protection of the security and rights of the bondholders and, to the extent permitted by the Lease, will use its best efforts to procure a new tenant or tenants for the leased property under lease provisions which will provide funds sufficient in amount to make the rental payments and other charges which the Company is required to make under the Lease. If the City is unable to procure a new tenant who will enter into such a lease the Fiscal Agent, acting for the City, may sell the Facility leased at a price not less than the amount of the then outstanding Bonds plus in- terest then unpaid with the consent of the United States of America acting through the Farmers Home Administration, an agency of the U. S. Department of Agriculture, or through any agency of the United States of America that may succeed to the function of said Farmers Home Administration and of all of the holders of the Bonds herein authorized at the time outstanding, or for a lesser price with the consent of the United States of America acting through the -26- C Farmers Home Administration, an agency of the U. S. Department of Agriculture, or through any agency of the United States of America that may succeed to the function of said Farmers Home Administration and of all of the holders of the Bonds herein authorized at the time outstanding. (C) The City will enforce collection of the rental payment and other charges in the amounts and at the time set forth in the Lease authorized hereby 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. The City's obligation to pay the expenses of such enforce- ment shall be limited to funds made available to it for that purpose by the holders of the Bonds or other interested parties. (D) Any purchase price of the lease property, any proceeds of condemnation awards or insurance proceeds, any of which are received by the City pursuant to the termination of the Lease, or any other funds intended for the purpose of paying the Bonds will be used solely and exclusively to pay the Bonds herein authorized and the interest thereon according to their terms or to redeem and pay any of the Bonds then outstanding and unpaid then subject to redemption and payment. Upon re- ceipt of any such funds, and as soon as the Bonds are subject to redemption and payment, the City shall proceed promptly to call the Bonds for re- demption and payment according to their terms -27- I and shall give notice, or cause notice to be given thereof, as provided for by the terms of this Ordinance. Such funds shall be deposited with the Fiscal Agent, and the same shall be used solely for the payment of the Bonds herein authorized, accrued interest thereon, any premium provided for by this Ordinance and the charges of the Paying Agent and the Fiscal Agent for paying the same. (E) The City will not issue any other obliga- tions payable from payments by the Company, pursuant to the Lease, nor voluntarily create or cause to be created any debt, lien, pledge, assignment, encum- brance, or any other charge on said payments or on the property subject to said Lease nor will it, unless required by law or by the terms of said Lease, sell or otherwise dispose of the Facility or any part thereof, provided, however, that said City may issue from time to time additional industrial revenue bonds for the purpose of completing the construction or acquisition thereof on the land herein referred to, extending or improving the Facility or acquiring or constructing additions thereto, provided the following terms and conditions are met: a lease or agreement with the Company with rentals or payments at least sufficient to pay the principal of and interest on said additional bonds as the same become due. (ii) The Company is not in default in the payment of rent due under the Lease. In the event of the issuance of any such -28- additional bonds the City may pledge the Facility and the net earnings therefrom to the payment of such additional bonds and the interest thereon, provided the City also pledges the additional construction, fix- tures and equipment and the net earnings therefrom, constructed or purchased out of the proceeds of such additional bonds, to the payment of the Bonds herein authorized and the interest thereon. (F) The City will cause the Company to keep constantly insured all buildings and improvements from time to time constituting a part of the proper- ty and premises leased to the Company in the manner provided for by the Lease herein authorized. The City's share of the proceeds of any such insurance policies shall be payable 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. (G) The City will cause the Fiscal Agent to maintain adequate records and accounts relating to the Facility, separate and apart from all other records or accounts of the City or the Fiscal Agent, and such records and accounts shall be maintained in accordance with generally accepted principles of accounting and shall include complete details of all financial transactions related to the Bonds authorized herein and the leased facili- ties. Such records and accounts shall be specifi- cally designed and maintained to show whether or not the provisions of this Ordinance and the Lease referred to herein are being complied with. Such books and records shall be available for inspection -29- by the agents of the Company or any of the holders of the Bonds authorized herein during the regular business hours of the City or the Fiscal Agent. Section 15. Amendments. The provisions of the Bonds authorized by this Ordinance and the provisions of this Ordinance may be modified or amended at any time by the City with the written consent of the United States of America acting through the Farmers Home Administration, an agency of the U. S. Department of Agriculture, or through any agency of t'IE. United States of America that may succeed to the function of said Farmers Home Administration and of all of the holders 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 modification of any duties or responsibilities of the Fiscal Agent unless it consents there- to, (b) the extension of the maturity of the principal of any of the Bonds issued hereunder, or the extension of the maturity of the interest on any Bonds issued hereunder, (c) a reduction in the principal amount of any Bonds or the rate of interest thereon, or (d) a reduction 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 United States of America acting through said Farmers Home Administration or through any agency of the United States of America that may succeed to the function of said Farmers Home Adminis- tration and 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 Company. Every amendment or modification of a provision of the Bonds or of this Ordinance to which the written consent of the United States of America and the bondholders is given -30- as above provided shall be expressed in an ordinance of the City amend- ing or supplementing 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 Bonds any reference to such amendment or modification, if any. Upon payment of the reasonable cost of preparing the same, a certified copy of every such amendatory or supplemental ordinance, if any, and a certified copy of this Ordinance will be sent by the City Clerk to any such bondholder or prospective bondholder requesting the same, except that a certified copy of every such amendatory or supplemental Ordinance, if any, and a certified copy of this Ordinance will be furnished to the United States of America and any of the original purchasers of the Bonds without cost. The Lease herein authorized may be amended by the City and the Company as provided therein, except as to rent or certain other matters which may be made only with the consent of a specified percentage of the holders of the then outstanding Bonds. Section 16. Enforcement. The provisions of this Ordinance shall constitute a contract between the City and the holders of the Bonds herein authorized, and the holder of any one or more of said Bonds may sue to recover interest or princi- pal which has not been paid according to the terms of said Bond. The holders of ten percent (10%) 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 said City or by said Company. 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 obligation contained herein or to pay the principal of or interest on the Bonds of the City herein authorized. -31- Section 17. Declaration of Maturity of Bonds in the Event of Default. In the event the principal of or interest on the Bonds herein authorized is not paid according to the terms thereof either on maturity or upon call for redemption, then the holders of ten percent (10%) of the principal amount of Bonds then outstanding or the United States of America acting through the Farmers Home Administration, an agency of the U. S. Depart- ment of Agriculture, or through any agency of the United States of America that may succeed to the function of said Farmers Home Administration may, by written notice given to the Mayor or City Clerk, declare the principal of all the Bonds herein authorized then outstanding to be due and payable immediately, and upon such declaration given as aforesaid, all of said Bonds 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 interest, except interest accrued but not yet due, and all arrears of principal shall have been paid in full, then in every such case, the holders of a majority in principal amount of the Bonds then outstanding with the written consent of the United States of America acting through said Farmers Home Administration or through any agency of the United States of America that may succeed to the function of said Farmers Home Admin- istration, by written notice to the Mayor or City Clerk, 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. Section 18. Defeasance. When all of the Bonds of the City herein authorized and all interest thereon shall have been -32- I i paid and discharged, then the requirements contained herein and the pledge of revenues made hereunder and all other rights granted hereby, shall cease and determine. Bonds 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 for the payment of the principal thereof and interest accrued to the date of matur- ity or redemption, as the case may be, or if default in such pay- ment shall have occurred on such date, then to the date of the tender of such payments; provided, always, that if any such Bonds shall be redeemed prior to the maturity thereof, the City shall have elected to redeem such Bonds and notice of such redemption shall have been given. Any moneys which at any time shall be de- posited with the said Fiscal Agent by or on behalf of the City, for the purpose of paying and discharging any of the Bonds, shall be, and are hereby, assigned, transferred and set over to such Fiscal Agent in trust for the respective holders of the Bonds, and such moneys shall be and are hereby irrevocably appropriated to the payment and discharge thereof. If, through lapse of time or otherwise, the holders of said Bonds shall no longer be entitled to enforce payment of their obligations, then, in such event, it shall be the duty of said bank forthwith to return said funds to the City. All moneys deposited with such Fiscal Agent shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance. Section 19. List of Bondholders. To the extent that such information shall be made known to the City under the terms of this Section 19, it will keep on file at the principal office -33- 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 Company or by the holders and/or owners (or a designated represen- tative thereof) of ten percent (10%) or more in principal amount of Bonds then outstanding, such ownership and the authority of any such designated representative to be evidenced to the satis- faction of the Fiscal Agent, Section 20. Provisions Relating to the Fiscal Agent. (A) Prior to the receipt of the Bond proceeds pursuant to the provisions of Section 9 hereof, the Fiscal Agent shall file with the City Clerk its written acceptance of the duties specified in this Ordinance and in the Lease and its agreement to act in said capacity. (B) The Fiscal Agent's duties and responsi- bilities 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, -34- opinions and conclusions stated therein and shall be full warrant, protection and authority to the Fiscal Agent for any action reasonably taken pur- suant 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 requirements of this Ordinance and the Lease. (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 Company. (E) No provision contained in this Section shall be construed to relieve the Fiscal Agent from liability for its own negligent 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 and the Fiscal Agent shall not be liable for any error of judgment made in good faith unless it shall be proved that the Fiscal Agent was negligent in ascertaining the pertinent facts. (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 or the Company or any bondholder and without incurring any liability whatsoever with respect thereto. -35- iJ (G) The Fiscal Agent may resign by an instru- ment in writing delivered to the City and the Company to take effect not sooner than 90 days after its delivery, whereupon the City, with the consent of the Company, 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 aggregat- ing 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 obliga- tions 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 10 days of its appointment. (H) The Fiscal Agent shall be entitled to pay- ment 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 ordi- nary services, all such fees and expenses to be paid by the Company as Additional Rent as specified in Article II of the Lease. (I) The City hereby authorizes the Fiscal Agent, on behalf of the City and in the name of the City or in the Fiscal Agent's own name, fully and promptly to en- force all of the terms, provisions and conditions of the -36- Lease which require performance by, or impose duties on, the Company, and in .the event of the occurrence of a de- fault, as defined in the Lease, to exercise all rights and remedies conferred by the Lease or this Ordinance (including without limitation the right to sell the Facility on the conditions set forth in subsection 14(B) of this Ordinance) for the full and complete protection of the security and rights of the holders of the Bonds. For such purpose, the Fiscal Agent shall have all of the powers of the City conferred by the Lease, this Ordinance and applicable law, which the Fiscal Agent may exercise without the nec- essity of any authorization by the City other than the adoption of this Ordinance. The City will not exercise any of its powers or give any consents under or in respect of the Lease without the prior written consent of the Fiscal Agent. (J) None of the provisions of this Ordinance shall require the Fiscal Agent to expend or risk its own funds or otherwise incur any personal fin- ancial liability in the exercise of any of the powers conferred upon it by this Ordinance if it shall have reasonable grounds to believe that re- payment of such funds or adequate indemnity against such risk or liability is not assured to it. Sub- ject to the foregoing, the holders of a majority in principal amount of the Bonds at the time outstand- ing shall have the right, during the continuance of a default under the Lease, to require the Fiscal -37- Agent to exercise any or all of its powers hereunder and to direct the time, method and place of exercis- ing any such power or conducting any proceedings for any remedy in pursuance thereof. Section 21. Authorization of Lease. The real property being referred to in the Lease as the "Land" and said Land, build- ings, improvements, fixtures, machinery and equipment described in Schedule 1 attached shall be leased to General Battery Corporation under and pursuant to a Lease dated as of September 1, 1976, substan- tially in the form attached to this Ordinance and marked Exhibit A, which Lease 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 22. Acceptance of Guaranty Agreement. The Mayor and the City Clerk are hereby authorized and directed to execute for and on behalf of, and as the act and deed of the City, the Acceptance of the Guaranty Agreement of the Company dated as of September 1, 1976, substantially in the form of the Guaranty Agreement attached to this Ordinance and marked Exhibit B. Section 23. 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 pro- hibited, or against public policy, or should for any reason what- soever be held invalid, then such covenants, agreements or provi- sions 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 Ordi- nance or of the Bonds issued hereunder, or of the Lease. Section 24. Conveyance of Facility. Upon receipt by the City of the purchase price of the property subject to said IMM Lease, title to said property shall be transferred and conveyed to the Company as provided in the Lease and the Mayor and other appropriate officers of said City are hereby authorized and directed to execute such deeds, bills of sale and other instru- ments as may be necessary to effect such conveyance and transfer. Section 25. Effective Date. This Ordinance shall take effect and be in force from and after its passage and publication in the official City paper. PASSED AND APPROVED by the governing body of the City of Salina, Kansas, this � day of September, 1976. ATTEST: City Clerk -39-