8432 IRB Asbury HospitalINDEX TO
ORDINANCE NO. 8432 OF THE CITY OF SALINA, KANSAS
TABLE OF CONTENTS
Page
Section
1.
Authority to Construct and. Purchase Facility---
2
Section
2.
Authorization of and Security for the Bonds----
2
ection
3.
Description and Details of the Bonds, Paying
Agent-------------------------------------------
3
Section
4.
Redemption and Payment of Bonds Prior to
Maturity, Notice of Redemption ------------------
4
Section
5. -Execution
of Bonds------------------------------
5
Section
6.
Form of Bond -------------------------------------
6
Section
7.
Delivery of Bonds, Deposit of Proceeds with
Fiscal Agent ------------------------------------
11
ection
8.
Construction Fund-------------------------------.-
11
Section
ection
9.
10.
Principal and Interest Account-------------------
Bond Reserve Account
12
---------------------------
13
Section
11.
Surplus Account --------------------------------
15
ection
12.
Investments------- _________________--________--_ .a
l0
Section
13.
Particular Covenants of the City_______________
16
`ection
14.
Amendments ---------------------------------------
22
'ection
15.
Enforcement -------------------------------------
�3
Section
16.
Acceleration in the Event of Default ------------
24
Section
17.
Defeasance --------------------------------------
24
Section
18.
Authorization of I -ease-------------------------
25
Section
19.
Conveyance of Facility to the Hospital-------
26
Section
20.
Severability-----------------------------------
26
ection
Schedule
21.
I.
Effective Date ---------------------------------
Description of Property ---------
26
28
.-______________
1
ORDINANCE NO. 8432
A ORDINANCE AUTHORIZING THE CITY OF SALINA, KANSAS, TO CONSTRUCT
A I) PURCHASE BUILDINGS, IMPROVEMENTS, MACHINERY AND EQUIPMENT TO
B LOCATED ON REAL PROPERTY DESCRIBED HEREIN TO BE LEASED TO THE
A BURY HOSPITAL ASSOCIATION; AUTHORIZING AND DIRECTING THE ISSUANCE
0 $1,750,000 PRINCIPAL AMOUNT OF HOSPITAL REVENUE BONDS, SERIES
0 MAY 1, 1975, OF SAID CITY FOR THE PURPOSE Oi PROVIDING FUNDS TO
P Y THE COST OF CONSTRUCTING AND PURCHASING BUILDINGS, IMPROVEMENTS,
M CHINERY AND EQUIPMENT TO BE LEASED TO THE ASBURY HOSPITAL ASSOCI-
A ION; PRESCRIBING THE FORM AND AUTHORIZING THE EXECUTION OF A LEASE
B AND BETWEEN SAID CITY AND THE ASBURY HOSPITAL ASSOCIATION.
WHEREAS, the City of Salina, Kansas, a city of the
s Gond class, hereinafter sometimes referred to as the "City",
dt,sires to promote, stimulate and develop the general economic
w lfare and prosperity of the City of Salina, Kansas, and its
evirons and thereby to further promote, stimulate and develop
tie general economic welfare and prosperity of the State of
as; and
WHEREAS, pursuant to the provisions of K.S.A. 12-1740
t 12-1749, said City is authorized to issue industrial revenue
b nds of the City, and it is hereby found and determined to be
a visable 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
4e cost of constructing and purchasing buildings, improvements,
finery and equipment to be leased to The Asbury Hospital Associ-
a4ion, a not-for-profit corporation organized under Kansas law for
spital purposes, hereinafter sometimes referred to as the
110ospital", and
WHEREAS, the total cost of constructing; and purchasing
s4id buildinvs, imbrovements, machinery and ecr.ainment for use by
1
1
The Asbury Hospital Association is estimated at $3,072,438, and th
City will have transferred to it by the Hospital prior to or con-
currently with the issuance of the Bonds herein authorized the
real property hereinafter described;
NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY
OF THE CITY OF SALINA, KANSAS:
Section 1. Authority to Construct and Purchase Facility.
The City of Salina, Kansas, is hereby authorized to have transferre
to it by the Hospital the real property described and set forth
on Schedule I attached hereto and made a part hereof and to con-
struct and purchase buildings, improvements, machinery and equip-
ment thereon, said real property and the buildings, improvements,
machinery and equipment identified being sometimes hereinafter
referred to as the "Facility", in accordance with the provisions
of the Lease dated as of May 1, 1975, herein authorized, between
said City and said The Asbury Hospital Association, hereinafter
sometimes referred to as the "Lease's, at an amount which will not
exceed the maximum cost of $1,750,000 to said City, to be paid
out of the proceeds of the bonds herein authorized:
Section 2. Authorization of and Security for the Bonds.
For the purpose of providing funds to pay the cost of constructing
and purchasing buildings, improvements, machinery and equipment
on the real property described in Schedule I attached hereto to
be leased to The Asbury Hospital Associations a not-for-profit
corporation organized under Kansas law for hospital purposes, there
shall be issued and hereby are authorized and directed to be issued
Hospital Revenue Bonds, Series of May 1, 1975, of the City of
Salina, Kansas, in the principal amount of $1,750,000. The Bonds
herein authorized, hereinafter sometimes refcnred to as the "Bonds"
-2-
Y
Section 3. Describtion and Details of the Bonds, Paying
Agent. Said Revenue Bonds shall be designated Hospital Revenue
Bonds, Series of May 1, 1975, and shall consist -of 350 Bonds,
numbered from 1 to 350, inclusive, each of said Bonds being iri
the denomination of $5,000. All of said Bonds shall be dated
May 1, 1975, and said Bonds shall be numbered, shall become due
on February 1 in each year and shall bear interest as follows:
or the "Revenue Bonds", and
all interest thereon
shall be paid
MATURITY
solely from the money and revenue
received from
the fees charged
AMOUNT
and rental received for the
use of the Facility
and not from any
1
other fund or source. The
City hereby pledges the
Facility and
7%
the net earnings therefrom
to the payment of the
Bonds and the
100,000
interest thereon.
7%
Section 3. Describtion and Details of the Bonds, Paying
Agent. Said Revenue Bonds shall be designated Hospital Revenue
Bonds, Series of May 1, 1975, and shall consist -of 350 Bonds,
numbered from 1 to 350, inclusive, each of said Bonds being iri
the denomination of $5,000. All of said Bonds shall be dated
May 1, 1975, and said Bonds shall be numbered, shall become due
on February 1 in each year and shall bear interest as follows:
Said Bonds shall bear interest from date payable
February 1, 1976, and thereafter semiannually on August 1 and
February 1.
Said Bonds and the interest coupons to be attached
thereto shall be .payable in lawful money of the United States
of America at the First State Bank and Trust Company, in the
City of Salina, Kansas, the same being heret.,! designated as the
City's Paying; Agent for the payment of the p:c°incipal of and inter-
est on the Revenue Bonds herein authorized and herein sometimes
referred to as the "Paying Agent".
-3-
MATURITY
ANNUAL RATE
NUMBERS
AMOUNT
FEBRUARY 1
OF INTEREST
1
- 19
$ 95,000
1979
7%
20
- 39
100,000
1980
7%
40
- 61
110,000
1981
7%
62
- 85
120,000
1982
7 1/11%
86
111
- 110
137
125,000
135,000
1983
7 1/4'
-
1984
7 1/4%
138
- 166
145,000
1985
7 1/4%
167 -
198
1605000
1986
7'1/2%
199 -
232
170,000
1987
7 1/2%
233 -
269
185,000
1988
7 1/2%
270 -
308
195,000
1989
7 1/2%
309 -
350
210,000
.1990
7 1/2%
Said Bonds shall bear interest from date payable
February 1, 1976, and thereafter semiannually on August 1 and
February 1.
Said Bonds and the interest coupons to be attached
thereto shall be .payable in lawful money of the United States
of America at the First State Bank and Trust Company, in the
City of Salina, Kansas, the same being heret.,! designated as the
City's Paying; Agent for the payment of the p:c°incipal of and inter-
est on the Revenue Bonds herein authorized and herein sometimes
referred to as the "Paying Agent".
-3-
Section 4. Redemption and Payment of Bonds Prior to
M,Iturity,.Notice
of Redemption. Each of said Bonds becoming
d
e in the years 1979 to 1990, inclusive, shall be subject to re-
d
mption and payment at the option of The Asbury Hospital Associa-
tj
Jon on any interest payment date upon any of the following con-
d
tions or events, provided all of said Bonds are redeemed and
p
id according to their terms: (1) if title to, or the use for
a
limited period of, substantially all of the Facility subject to
s
id Lease, be condemned by any authority having the power of
eiiinent
domain; (2) if substantially all of the Facility is 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 legis-
1
tive or administrative action by the State of Kansas, or any
p
litical subdivision thereof, or by the United States, or by
r
ason of any action instituted in any court, the Lease herein
a
thorized shall become void or unenforceable, or impossible of
p
rformance without unreasonable delay, or in any other way,
b
reason of such change of circumstances, unreasonable burdens
oi,
excessive liabilities, including Federal, State or other taxes
n
t now being imposed are imposed on the Hospital or the City.
e redemption price for Bonds redeemed pursuant to this paragraph
s
all be the principal amount of Bonds so redeemed, plus accrued
i
terest thereon to and including the date fixed for redemption
d payment, together with a premium of 3% of the principal amount
the Bonds so redeemed and paid.
Each of said Bonds becoming due in the years 1986 to 1.990,
i
elusive, shall also-be subject to redemption and payment at the
tion of said City, in whole or in'part, in inverse numerical
der on February 1, 1985, or on any interest payment date there-
ter at the principal amount thereof plus accrued interest thereon
Lo date fixed for redemption and payment, together with a premium
hich shall be 3% of the principal amount of the bonds so redeemed
nd paid..
Notice of any redemption provided for by this Ordinance
hall be given in the name of the City by the City, the Hospital
r the Fiscal Agent by United States registered mail to the Paying
gent herein designated, and to First Securities Company of Kansas,
ne., such notice to be mailed at least 30 days prior to the date
ixed for redemption and payment and to specify the numbers of the
onds to be redeemed and paid. Notice of any such redemption shall
lso be published once not less than 30 days or more than 90 days
rior to the date fixed for redemption in the official state news -
aper of the State of Kansas and in some financial journal publishe
nd of general circulation in New York, New York. Interest shall
ease on any of said Bonds so called for redemption and payment
s of the redemption date, provided funds are deposited with the
aying Agent to pay the same according to their terms. The City
hall give notice of any redemption as herein provided only upon
itten instructions from the Hospital.
Section 5. Execution of Bonds. Said Bonds and each
of them shall be executed for and on behalf of the City by the
11facsimile signature of its Mayor and attested by the facsimile
signature of its City Clerk, with the seal of the City affixed.
Interest coupons shall be attached to the Bonds representing the
interest to mature thereon, and said interest coupons shall bear
the facsimile signatures of the Mayor and CiLar Clerk of said City.
Said Bonds and each of them shall be registered in the office of
the City Clerk which registration shall be e,..idenced by a certifi-
tate on the reverse face thereof bearing; the Manual signature of
the City Clerk. In the event either said May,)r or Clerk or beth
aid officers shall cease to hold such office before the Bonds
nd coupons, if any, bearing their signatures shall have been
ssued and delivered, said Bonds may be issued and delivered, as
hough said officers had not ceased to hold office and such sig-
atures appearing on said Bonds, coupons and registration certifi-
ates shall be valid and sufficient for all purposes as if they
remained in office until such issuance and delivery.
Section 6. Form of Bond.
Each of said Bonds, the
terest coupons, and the Certificate of Registration on the Bonds
hall be in substantially the following form:
(FORM OF BOND)
No. $5,000
UNITED STATES OF AMERICA
STATE OF KANSAS
COUNTY OF SALINE
CITY OF SALINA
HOSPITAL REVENUE BOND
SERIES OF MAY 1, 1975
KNOW ALL MEN BY THESE PRESENTS: That the City of
Salina, in the County of Saline, State of Kansas, for value re-
ceived, hereby promises to pay, out of the revenues hereinafter
specified, to the bearer, the sum of
FIVE THOUSAND DOLLARS
in lawful money of the United States of America, on the first day
of February, 19,, and in like manner to pay :interest thereon
from the date hereof at the rate of percent
( %) per annum, payable February 1, 1976, and thereafter
semiannually on August 1 and February 1 in ery:h year after the
date hereof until the said principal sum shall have been paid,
upon presentation and. surrender of the inter -:;t coupons hereto
attached, bearing the facsimile signatures of the Mayor and City
Clerk of said City as said coupons severally '-)L-come due, both
-6-
rincipal of and interest on this Bond being payable at the
irst State Bank and Trust Company, in the City of Salina, Kansas.
THIS BOND is one of an authorized series of 350 Bonds
ggregating the principal amount of $1,750,000 numbered from 1 to
50, inclusive, authorized by ordinance of said City for the pur-
ose of providing funds to pay the cost of constructing and pur-
hasing buildings, improvements, machinery and equipment, the real
roperty, buildings, improvements, machinery and equipment herein-
fter sometimes referred to as the "Facility", said Facility being
urther identified in the Ordinance authorizing this Bond to be
eased to The Asbury Hospital Association, a not-for-profit corpora
ion organized under Kansas law for hospital purposes, pursuant to
Lease dated May 1, 1975, by and between said City and said Hospit
y the authority of and in conformity with the provisions, restric-
hereof and acts supplemental thereto, and all other provisions of
he laws of said State applicable thereto, and this Bond and all
nterest hereon are to be paid by said City of Salina,,Kansas,
solely and only from the money and revenue received from the fees
barged and rental received for the use of the Facility under said
Lease and not from any other fund or source. The principal of and
interest on this Bond shall not in any respect be a general obliga-
ion of the City, nor shall they be payable in any manner by taxa -
ion. 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 authorizing this Bond -cnd to said Lease
for a description of the Facility and the covenants of the City
--7-
ions and
limitations
of the
Constitution and statutes
of the State
f Kansas,
including
K.S.A.
12-1740 to 12-1749, and all
amendments
hereof and acts supplemental thereto, and all other provisions of
he laws of said State applicable thereto, and this Bond and all
nterest hereon are to be paid by said City of Salina,,Kansas,
solely and only from the money and revenue received from the fees
barged and rental received for the use of the Facility under said
Lease and not from any other fund or source. The principal of and
interest on this Bond shall not in any respect be a general obliga-
ion of the City, nor shall they be payable in any manner by taxa -
ion. 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 authorizing this Bond -cnd to said Lease
for a description of the Facility and the covenants of the City
--7-
ith respect to the collection, segregation and application of
Each of the Bonds of the series of which this Bond is
ne is subject to redemption and payment prior to maturity on any
nterest payment date at the option of The Asbury hospital Associa-
ion upon any of the following conditions or events, provided all
f said Bonds are redeemed and paid according to their terms:
1) if title to, or the use for a limited period of, substantially
11 of the Facility be condemned by any authority having the power
f eminent domain; (2) if substantially all of the Facility is
amaged or destroyed by fire or other casualty; or (3) if as a
result of changes in the Constitution of the State of Kansas or
f legislative or administrative action by the State of Kansas or
ny political subdivision thereof, or by the United States, or by
eason of any action instituted in any court, the Lease shall be -
tome void or unenforceable or impossible of performance without
nreasonable delay, or in any other way by reason of such circum-
tances, unreasonable burdens or excessive lit.bilities, including
ederal, State or other taxes not now being ir:posed are imposed
the Hospital or the City. The redemption ;rice for Bonds
edeemed pursuant to this paragraph shall be i1he principal amount
f Bonds so redeemed, plus.accrued interest ti-zereon to and in-
luding the date fixed for redemption and payx::ont, together with
premium of 3% of the principal amount of the Bonds so redeemed and
aid
IMM
ne money and revenue
received
from the fees charged and rental
received for the use
of the Facility,
the rights, duties and
bligations of the City
and the
Hospital with respect thereto,
he right of the City
to issue
additional bonds and the rights
Df the holders of the
series of
Bonds of which this Bond is one.
Each of the Bonds of the series of which this Bond is
ne is subject to redemption and payment prior to maturity on any
nterest payment date at the option of The Asbury hospital Associa-
ion upon any of the following conditions or events, provided all
f said Bonds are redeemed and paid according to their terms:
1) if title to, or the use for a limited period of, substantially
11 of the Facility be condemned by any authority having the power
f eminent domain; (2) if substantially all of the Facility is
amaged or destroyed by fire or other casualty; or (3) if as a
result of changes in the Constitution of the State of Kansas or
f legislative or administrative action by the State of Kansas or
ny political subdivision thereof, or by the United States, or by
eason of any action instituted in any court, the Lease shall be -
tome void or unenforceable or impossible of performance without
nreasonable delay, or in any other way by reason of such circum-
tances, unreasonable burdens or excessive lit.bilities, including
ederal, State or other taxes not now being ir:posed are imposed
the Hospital or the City. The redemption ;rice for Bonds
edeemed pursuant to this paragraph shall be i1he principal amount
f Bonds so redeemed, plus.accrued interest ti-zereon to and in-
luding the date fixed for redemption and payx::ont, together with
premium of 3% of the principal amount of the Bonds so redeemed and
aid
IMM
0
Each of the Bonds of the series of which this Bond is
one becoming due in the years 1986 to 1990, inclusive, is subject
o redemption and payment at the option of said City, in whole or
Ln part, in inverse numerical order on February 1, 1985, or on any
nterest payment date thereafter, at the principal amount thereof
lus accrued interest thereon to date fixed for redemption and
ayment, together with a premium which shall be 3% of the principal
ount of the bonds so redeemed and paid.
Notice of any redemption pursuant to any of the redemp-
ion provisions aforesaid, specifying the numbers of the Bonds to
De redeemed and paid, shall be given by United States registered
ail to the Paying Agent named herein not less than 30 days prior
o the date fixed for redemption and payment. Notice of any such
ademption shall also be published once not less than 30 days or
ore than 90 days prior to the date fixed for redemption in the
£ficial state newspaper of the State of Kansas and in some finan-
ial*journal published and of general circulation in New York,
New York.
AND IT IS HEREBY DECLARED AND CERTIFIED that all acts,
onditions and things required to be done and to exist precedent
o and in the issuance of this Bond have been properly done and
erformed and do exist in due and regular form and manner as re-
quired 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
th the facsimile signatures of said officers, and this Bond to
dated this First day of May, 1975•
(facsimile)
Mayor
TEST:
facsimile)
ity Clerk
(FORM OF COUPON)
-10-
oupon No.
'
February,
)February 1
On the'First day of August, 19_, unless
)August 1, 19_
he Bond to which this coupon is attached be
)---------------------
alled for redemption and payment duly made
)City of Salina, Kansa
r provided for, the City of Salina, Kansas,
)Hospital Revenue
)Bond
ill pay bearer, solely from the money and
)Series of May 1, 1975
evenue received from the fees,charged and
)---------------------
ental received for the use of the Facility
)$
escribed in the Bond to which this coupon
)
)
Js
attached, and not from any other fund or
)
ource, the amount shown hereon, in lawful
)
oney of the United States of America, at the
)
irst State Bank and Trust Company, Salina,
)
ansas, being interest due on its Hospital
)
}
evenue Bond, Series of May 1, 1975, dated
)
ay 1, 1975, No.
)
TTEST:
)
(facsimile)
)
Mayor
)
(facsimile)
City Clerk
)
)
�.------------------------------------------ --------------------
-10-
1
ATE OF KANSAS )
) SS.
UNTY OF SALINE )
I, the undersigned, City Clerk of the City of Salina,
ansas, hereby certify that the within Hospital Revenue Bond,
eries of May 1, 1975, of the City of Salina, Kansas, has been
my registered in my office according to law.
WITNESS my hand and official seal this
SEAL)
City Clerk
Section 7. Delivery of Bonds, Deposit of Proceeds with
Fiscal Agent. The Mayor and City Clerk are hereby authorized and
irected to prepare and execute in the manner hereinbefore speci-
ied the Hospital Revenue Bonds, Series of May 1, 1975, of the
ity herein authorized and to deliver said Bonds to First Securi-
ies Company of Kansas, Inc., the representative of the purchasers
hereof, on payment of the purchase price. The proceeds of said
onds shall be deposited with First State Bank and Trust Company,
n the City of Salina, Kansas, hereby designated as the City's
fiscal Agent and hereinafter referred to as the "Fiscal Agent".
Section 8. Construction Fund. There is hereby authorized
Ind ordered to be established in the hands of the Fiscal Agent, a
separate fund or account designated as the "City of Salina, Kansas,
The Asbury Hospital Association Construction Fund", hereinafter
sometimes referred to as the "Construction Fund". The Fiscal Agent
hall first pay out of the proceeds of said bond issue any and all
xpenses of whatever nature incurred by the City in connection
lth the issuance and sale of the Bonds, the payment of said expense
i
in said Lease. Any moneys not required for said purpose shall,
when the Facility is complete, be deposited by the Fiscal Agent
in said Principal and Interest Account established in Section 9,
su h deposit to be made at such time as the Project Manager desig-
ns ed in the Lease shall certify that the Facility is complete, or
to
be made in accordance with the City's written instructions to
termination of the
the
1iiiscal Agent approved by an appropriate officer of The Asbury
Hospital
Association and specifying the amounts to be disbursed
Interest Account. There is
arid
the persons to whom such disbursements are to be made. The
eby authorized
Fi
cal Agent shall, next, promptly pay from the proceeds of the
sale
of said Bonds into the Principal and Interest Account for
a separate account to be known as the "City of
and Interest Account for Hospital
H
spital Revenue Bonds, Series of May 1, 1975 - Account No. 1,
hE
einafter created, the amount of any accrued interest and premium,
if
any, received from such sale, together with such additional
a
unt as will aggregate the interest becoming due on the Bonds
or
February 1, 1976, August 1, 1976 and February 1, 1977, represent-
irg
interest due during the construction of the Facility. The bal-
.aroe
of the proceeds of the sale of said Bonds shall be deposited in
sa
d Construction Fund. Said Construction Fund shall be used for
t
purchasing
purpose of providing funds to pay the cost of constructing and
the buildings, improvements,
machinery and equipment
to
be located on the real property described in Schedule I attached
he
eto to be leased to The Asbury Hospital Association, as provided
in said Lease. Any moneys not required for said purpose shall,
when the Facility is complete, be deposited by the Fiscal Agent
in said Principal and Interest Account established in Section 9,
su h deposit to be made at such time as the Project Manager desig-
ns ed in the Lease shall certify that the Facility is complete, or
nue Bonds, Series of May 1, 1975 - Account No. 111, hereinafter
-12-
up
n the earlier
termination of the
Lease.
Section
9. Principal and
Interest Account. There is
he
eby authorized
and ordered to be
established in the hands of
th
Sa
Fiscal Agent
ina, Kansas, Principal
a separate account to be known as the "City of
and Interest Account for Hospital
nue Bonds, Series of May 1, 1975 - Account No. 111, hereinafter
-12-
1
metimes referred to as the "Principal and Interest Account".
e City covenants and agrees that from and after.the delivery of
y of the Revenue Bonds herein authorized and continuing so long
any of said Bonds shall remain outstanding, said City will main -
in said account with the Fiscal Agent. The Fiscal Agent shall,
ginning February 1, 1977 .and each month thereafter first pay
d deposit from the monthly rental payments in the amount of
9,125 due under the Lease, into the Principal and Interest
count an amount not less than one-sixth of the amount payable
interest on the Bonds on the next interest payment date, and
e -twelfth of the amount payable as principal on the Bonds on the
xt principal payment date; provided that payments on account of
incipal shall not be commenced until February 1, 1978•
Section 10. Bond Reserve Account. There is hereby
thorized and ordered to be established in the hands of the
seal Agent a separate account to be known as the "City of Salina,
nsas, Bond Reserve Account for Hospital Revenue Bonds, Series
May 1, 1975 - Account No. 211, hereinafter sometimes referred
as the "Bond Reserve Account". The City covenants and agrees
at from and after the delivery of any of the Revenue Bonds herein
thorized and continuing so long as any of said Bonds shall remain
tstanding, said City will maintain said Br,;:",. Reserve Account
th the Fiscal Agent. The Fiscal Agent shalt, prior to the de -
very of the bonds to the purchaser, deposit. '6.0 the "Bond Reserve
count" from funds furnished to it by the Ii ';>ital, the amount
One Hundred Thirty Thousand Dollars ($130,'-0). The Fiscal
ent further covenants and agrees that begin :.1ng on February 1,
77, and continuing on or before the first c y of each month
ereafter, the Fiscal Agent shall, after mai .-,.?,,g the deposits
-13-
1
f1
1
uired by Section 9 of this Ordinance, pay and deposit each
th from said monthly rental payments into the "Bond Reserve
count!', the amount of Seven Thousand Eighty-five Dollars ($7,085)
til said monthly deposits, along with the deposit of One Hundred
arty Thousand Dollars ($130,000) and earnings on investments in
aid Account, shall aggregate the amount of Two Hundred Twenty-five
housand Dollars ($225,000), said amount being herein sometimes
ailed the "Maximum Bond Reserve Amount". Said "Bond Reserve
ccount" shall be used by the Fiscal Agent solely to prevent any
efault in the payment of the principal of or interest on the bonds
erein authorized if at any time the moneys in the "Principal and
nterest Account" are insufficient to pay the principal of or inter-
st on said bonds as the same become due. So long as said "Bond
.eserve Account" shall aggregate said "Maximum Bond Reserve Amount"
o further payments or credits to said account shall be required,
ut if at any time or from time to time the Fiscal Agent shall be
ompelled to use and expend any part of said "Bond Reserve Account"
or the purpose of paying the interest on or principal of the Bonds
erein authorized and such use shall reduce the amount.of said
ccount below said "Maximum Bond Reserve Amount", then the Fiscal
gent, from rental payments or other funds made available by the
ospital, will resume monthly payments of Se,,• 1. 1,i Thousand Eighty-five
ollars ($7,085) each to the "Bond Reserve until there
hall have accumulated in said "Bond Reserve "ccount" the '"Maximum
and Reserve Amount". The obligation of the 21.scal Agent to make
aid payments to said "Bond Reserve Account" gall be limited to
rental payments and funds made available .o it by the Hospital.
Interest earned on investments of '>inds in the "Bond
serve Account" until February 1, 1977 shal:1 accumulate and be
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redited to the "Bond Reserve Account". Earnings on investments
the "Bond Reserve Account" after February'l, 1977 shall accrue
o the "Bond Reserve Account" until the "Maximum Bond Reserve
mount" shall have accumulated in the "Bond Reserve Account".
er the accumulation of the "Maximum Bond Reserve Amount", in-
ome from investments in the "Bond Reserve Account" shall be
ransferred to the "Surplus Account" hereinafter created.
Section 11.
Surplus Account. There is hereby author -
zed and ordered to be established in the hands of the Fiscal
gent a separate account to be known as the "City of Salina,
Kansas, Surplus Account for The Asbury Hospital Association -
Account No. 3", hereinafter sometimes referred to as the "Surplus
Account". The City covenants and agrees that from and after the
elivery of any of the Revenue Bonds herein authorized and con-
tinuing so long as any of said Bonds shall remain outstanding,
aid City will maintain said Surplus Account with the Fiscal Agent.
he'Fiscal Agent, after making the deposits required by Sections
and 10 of this Ordinance, shall deposit the balance of said
monthly rental payment of $19,125 into the Surplus Account.
Moneys held in the Bond Reserve Account and Surplus
Account shall. be used only for the purpose of paying the interest
n or principal of the Bonds herein authorize; in the event moneys
n the Principal and Interest Account are not 7ufficient for such
purpose,, for the payment of fiscal service c1_-,,ges, for the re-
iremert of. Bonds of this bond issue prior to a:!a.turity, , for the
urchase of Bonds of this bond issue in the c;cia market at fair
arket value, or for enlargement and impriovei,,C_i-;t of the Project-,
mer€;ency repairs to the Facility, and for no other purpose.
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1
Section 12. Investments. Moneys in the Construction
And shall be invested by the Fiscal Agent in direct obligations
ogIthe United States Government or agencies thereof becoming due
wJ hin six months from the date of purchase. Such investments
slall be made by the Fiscal Agent without further directions
fiDm the City or the Hospital unless the Hospital shall advise the
F cal Agent in writing that it shall make such investments only
a the direction of the Hospital in which event the Fiscal Agent
sl 11 invest said moneys in such obligations upon receipt of in-
structions from an appropriate officer of the Hospital. Moneys
allocated and credited to and deposited in the Principal and Inter-
eE Account in any amount in excess of the amount necessary to
'pey the amount of principal and interest next becoming due, in
t1e Reserve Account and in the Surplus Account shall be invested
b the Fiscal Agent, upon instructions from the Hospital, if at
tle time permitted by law, in bonds or other direct obligations of
the United States Government or agencies thereof having a fixed
rE emption value or becoming due without loss of principal not
lEter than January 15, 1990. No investment shall be made pursu-
art to this section for a period longer than the time the Fiscal
AEent shall determine that said funds are not required for the
ptrpose for which they are intended. Except as provided for earn-
ir s on investments in the Bond Reserve Account, interest on any
bcnds or other obligations held in any fund or account created
b5 this Ordinance shall accrue to and become a part of such fund
ox account.
Section 13. Particular Covenants of the City. So long
a any of the principal of and interest on the Bonds herein author -
i rdremain outstandinv, and unpaid or nrovisioi, made for the payment
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t ereof, the City covenants with each of the holders and owners
01, said Bonds as follows:
(a) 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 give notice of.
any default provided for by the Lease; 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 Hospital,
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 Facility under lease
provisions which will provide funds sufficient in
amount to make the rental payments and other charges
which the Hospital is required to make under the
Lease dated May 1, 1975. If the City is unable
to procure a new tenant who will enter into such
-17-
a lease the City may, with
the consent
of the
holders of not less than a
majority of
the Bonds
herein authorized sell the
property then
covered
by the Lease at a price not
less than the
amount
of said outstanding revenue
bonds, plus
interest
then unpaid, together with
x.11 prem-Plms
required.
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(b) The City will enforce collection of
..the rental payments and other charges in the amounts
and at the time set forth in the Lease herein author-
ized 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 said Lease. The City's obligation 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.
(c) Until payment of all the Bonds and inter-
est thereon has been duly made or provided for, the
City will not consent to any change, amendment,
modification or termination of said Lease, except
as provided'therein, which will in any manner affect
adversely the rights, remedies or interest of the
bondholders, nor will it consent to any merger,
consolidation, dissolution or liquidation by the
Hospital except to the extent provided therein.
(d) Any purchase price of the property covered
by the Lease, any proceeds of cond<. _Ina_tion awards
or insurance proceeds, any of whic:, :1're received
by the City pursuant to the termin , ;.i on of the
Lease, or any other funds intendec; 'or the purpo'se
of paying the revenue bonds Vrill used solely and
exclusively to pay the Bonds here,_ authorized and
the interest thereon
according to '')eir terms or
to redeem and pay any of said bonds then outstanding
-18-
1
1
and unpaid then subject to redemption and payment.
Upon receipt of any such funds; and as soon as
said bonds are subject to redemption and payment,
the City shall proceed promptly to call said reve-
nue bonds for redemption and payment according to
their terms and shall give notice thereof 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 said
revenue bonds, accrued interest thereon, any premi-
um provided for by this Ordinance and the charges
of the Fiscal Agent for paying the same.
(e) The City will not issue any other
obligations payable from payments by the Hospital,
pursuant to the Lease, nor voluntarily create or
cause to be created any debt, lien, pledge, assign-
ment, encumbrance, 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 time to
time additional industrial revenue '.:onds in an
aggregate principal amount not to t;<-ceed Two
Hundred Fifty Thousand Dollars ( 4%21 �- , 000 ) for the
purpose of completing the construc:'_on or acquisi-
tion thereof on the land herein re`•.rred to,
provided the following terms and co:iditions are
met:
-1�-
(i) The City shall have entered into
a lease or agreement with the Hospital
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 Hospital is not in default
in the payment of rent due under the Lease.
(iii) The issuance of said additional
bonds shall not affect the exemption from
Federal income taxation of the interest on
the bonds herein authorized.
In the event of the issuance of any such
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, fixtures 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 not volunta.- ly create
or cause to be created any debt, 11.,-,n, pledge,
assignment, encumbrance, or any otr�'--- charge,
on the payments provided for by th-, Lease or on
the property covered by said Leasc nor will it,
unless required by law or the terms of said
Lease, sell or otherwise dispose G" the Facility
or any part thereof.
-2p_
u
I
(g) The City's share of the proceeds of
any insurance policies provided for by the Lease
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.
(h) The City will cause the Fiscal Agent
to maintain adequate records and accounts,
separate and apart from all other records or
accounts of 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 facilities.
Such records and accounts shall be specifically
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 by the agents of the C -"Cy, the
Hospital or any of the holders of the Bonds
authorized herein during the r.egt:,.:_,r business
hours of the Fiscal Agent. Once ac;h year the
City shall cause the Fiscal Agee'_ ;.o prepare a
report covering all such financir, transactions
for the preceding twelve months oe mailed to
the City, the Hospital, First- Se:— cities Company
of Kansas, Inc., and to any bond,;-;1.der requesting
the same.
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_%:V
ss than sixty-six and two-thirds percent (66 2/3%) in aggregate
inpIpal amount of the Bonds herein authorized at the time out-
nding, provided that no such modification or amendment shall
mit or be construed as permitting: (a) the extension of the
turity of any payment of the principal of or the interest on
Bonds issued hereunder, (b) an increase or reduction in the
incipal amount of any Bonds, or the redemption premium, or the
to of interest thereon, (c) the creation of a lien upon or a
edge of revenue other than the pledge created by this Ordinance
cept as herein provided, (d) permitting a preference or priority
any bond or bonds over any other bond or bonds, or (e) a
duction in the percentage of the aggregate principal amount of
nds, the consent of the holders of which is required for any
ch amendment or modification. Any provision of the Bonds or
this Ordinance may, however) be modified or amended in any
spect with the written consent of the holders of all of the
nds then outstanding. Any amendment to this Ordinance which
res. ambiguities or omissions herein, adds to the security of
e holders of the Bonds herein authorized or adds to the City's
venants and agreement may be made without the consent of said
ndholders. As long as the Hospital is not in default under the
ase no amendment to the Bonds or this OrdinaInce which violates
trie Hospital's contractual rights under the Lease or this Ordinance
all become effective unless consented to by the Hospital.
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Section
14.
Amendments. Except as provided in paragraph
(11.)
of Section 13
of
this Ordinance and as hereinafter provided
t
e provisions of
the
Bonds authorized by this Ordinance and the
p
ovisions of this
Ordinance
may be modified or amended at any
t
me by the City with
the written consent of the holders of not
ss than sixty-six and two-thirds percent (66 2/3%) in aggregate
inpIpal amount of the Bonds herein authorized at the time out-
nding, provided that no such modification or amendment shall
mit or be construed as permitting: (a) the extension of the
turity of any payment of the principal of or the interest on
Bonds issued hereunder, (b) an increase or reduction in the
incipal amount of any Bonds, or the redemption premium, or the
to of interest thereon, (c) the creation of a lien upon or a
edge of revenue other than the pledge created by this Ordinance
cept as herein provided, (d) permitting a preference or priority
any bond or bonds over any other bond or bonds, or (e) a
duction in the percentage of the aggregate principal amount of
nds, the consent of the holders of which is required for any
ch amendment or modification. Any provision of the Bonds or
this Ordinance may, however) be modified or amended in any
spect with the written consent of the holders of all of the
nds then outstanding. Any amendment to this Ordinance which
res. ambiguities or omissions herein, adds to the security of
e holders of the Bonds herein authorized or adds to the City's
venants and agreement may be made without the consent of said
ndholders. As long as the Hospital is not in default under the
ase no amendment to the Bonds or this OrdinaInce which violates
trie Hospital's contractual rights under the Lease or this Ordinance
all become effective unless consented to by the Hospital.
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FM
Every amendment or modification of a provision of the
ds or of this Ordinance to which the written consent of the
ndholders is given as above provided shall be expressed in an
dinance of the City amending or supplementing the provisions of
is Ordinance and shall be deemed to be as of this Ordinance.
t shall not be necessary to note on any of the outstanding
nds_any reference to such amendment or modification, if any.
certified copy of every such amendatory or supplemental
finance, if any, and a certified copy of this Ordinance will
e sent by the City Clerk to any bondholder requesting the same.
The Lease herein authorized may be amended by the
ity and the Hospital as provided therein -and as provided in
aph (e) of Section 13 of this Ordinance, except as to
ent or certain other matters as specifically enumerated in the
ease which may be amended only with the consent of the specified
ercentage of the holders of the then outstanding Bonds set out
n said Lease.
Section 15. Enforcement. The provisions of this
dinance shall constitute a contract between the City of
Salina, Kansas, and the holders of the Revenue Bonds herein
uthorized, and the holder of any one or more of said Bonds may
ue to recover interest or principal or premium, if any, which
as not been paid according to the terms of said Bond. The holders
f 25% of the principal amount of Bonds then outstanding may sue
n any action, in mandamus, injunction or other proceedings, either
t law or in equity, to enforce or compel per:'ormance of all
n this Ordinance shall, however, be construed to impose on said
ty any duty or obligation to levy any taxes either to meet any
-23-
uties and obligations
required by
this Ordin�.nce to
be done or
erformed by said City
or by said
Hospital. Nothing
contained
n this Ordinance shall, however, be construed to impose on said
ty any duty or obligation to levy any taxes either to meet any
-23-
0iligation contained herein or to pay the principal of or interest
oil
the Revenue Bonds of the City herein authorized.
standing.
•
Section 16. Acceleration in the Event of Default. In
�
I
0iligation contained herein or to pay the principal of or interest
nc ice 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,
of of said Bonds shall be immediately due and payable, anything in
sa
oil
the Revenue Bonds of the City herein authorized.
standing.
Section 16. Acceleration in the Event of Default. In
that
the
event the principal of or interest on the Bonds herein
i
authorized
is not paid according to the terms thereof either on
Ish
m
turity or upon call for redemption, then the holders of 25%
of
o
the -principal amount of Bonds then outstanding may, by written
nc ice 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,
of of said Bonds shall be immediately due and payable, anything in
sa
d Bonds or in the Ordinance contained to the contrary notwith-
standing.
This provision, however, is subject to the condition
that
if at any time thereafter, all arrears of interest, except
i
erest accrued but not yet due, and all arrears of principal
Ish
11 have been paid in full, then in every such case, the holders
of
a majority in principal amount of the Bonds then outstanding,
by
written notice to the Mayor or City Clerk, may rescind and annul
su
h declaration and its consequences, but no such rescission or
annulment
shall extend to or affect any subsequent default or
im
air any rights consequent thereon.
Section 17. Defeasance. When all of the Bonds of the
Ci
y herein authorized and all coupons representing interest thereon
shall
have been paid and discharged, then the requirements con-
ta
ned herein and the pledge of revenues made hcreunder and all
otter
rights granted hereby shall cease and detc'.rrline. Bonds and
coupons
shall be deemed to have been paid and da.scharged within
tht
meaning of this Ordinance and within the me,,,n ing of the Lease
authorized
by this Ordinance when there shall ht, -:)re been deposited
wi
h the Fiscal Agent at or prior to the maturity/ or redemption
-24-
ate, of said Bonds and coupons, in trust for and irrevocably
ppropriated thereto, sufficient moneys for the payment of the
rincipal thereof and interest accrued to the date of maturity
redemption, as the case may be, or if default in such payment
11 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 and paid 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
deposited with the said Fiscal Agent by or on behalf of the City,
for the purpose of paying and discharging any of the Bonds or
coupons, including the payment of any premium thereon, shall be,
and are hereby, assigned, transferred and set over to such Fiscal
Agent in trust for the respective holders of the Bonds and coupons,
and such moneys 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 or coupons 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 for deposit in the Principal and Interest Account.
All moneys deposited with such Fiscal Agent -.hall be deemed to be
deposited in accordance with and subject to ,, 1 of the provisions
contained in this Ordinance.
Section 18. Authorization of Leas.:. The tract of land
herein referred to and the buildings, impro,, :-:cents, machinery
and equipment to be acquired, installed and ,:,.�--nstructed thereon
pursuant to this Ordinance shall be leased Ia The Asbury Hospital
Association under and pursuant to a Lease d:.ed May 1, 1975, sub-
stantially in the form attached to this Ord'`.,�ance and marked
-25-
U
1
xhibit A, which Lease the Mayor and City Clerk are hereby author -
zed and -directed to execute for and on behalf of and as the act
deed of the City.
Section 19. Conveyance of Facility to the Company.
Pon receipt by the City of the purchase price of the property
ubject to said Lease, as set out in Article XVII of said Lease,
itle to said property shall be transferred and conveyed to the
ompany as provided in the Lease and the Mayor and other appro-
iate officers of said City are hereby authorized and directed
o execute such deeds and other instruments as may be necessary
o effect such conveyance and transfer.
Section 20.
Severability. If any one or more of the
ovenants, agreements or provisions of this Ordinance or of said
,ease should be held contrary to any express provision of law
r contrary to the policy of express law, though not expressly
rohibited, or against public policy, or shall for any reason
hatsoever beheld invalid, then such covenants, agreements or
rovisions shall be null and void and shall be deemed separate
rom the remaining covenants, agreements or provisions, and
hall in no way affect the validity of the other provisions of
his Ordinance or of the Bonds or coupons issued hereunder, or
he Lease.
Section 21. Effective Date. This C•dinance shall take
ffect and be in force from and after its pa.s,1ge and publication
n the official City paper.
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PASSED by the Governing; Body of the City of Salina, Kansas,
t is 5th• day of May , 1977,
APPROVED by the Mayor this 5th day of May
1 75.
A TEST:
ty Clerk
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1
1
SCHEDULE I TO LEASE DATED 14AY 1, 1975, BY
AND BETWEEN THE CITY OF SALINA, KANSAS,
AND THE ASBURY HOSPITAL ASSOCIATION AND TO
ORDINANCE NO. 8432 OF SAID CITY RELATING
THERETO.
Lots One (1), Three (3) and the North 5.9'
of Lot Five (N 5.9' L 5) on Seventh Street
in Holland's Addition to the City of Salina;
and Lots Two (2), Four (u) and the North
5.9' of Lot 6 (N 5.9' L 6) on Santa Fe Avenue
in Holland's Addition to the City of Salina;
Saline County, Kansas.
Subject to: (i) easements, restrictions and
reservations now of record, (ii) the rights of the
public in and to any part of the premises lying or
being in public roads, alleys or highways and (iii)
taxes and assessments, general and special, not now
due or payable.
Schedule I