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92-9504 Issue BondsKuhn-Gon Pt "lq — Salina, Kansas ORDINANCE NO. 92-9504 OF THE CITY OF SALINA, KANSAS $2,900,000 GENERAL OBLIGATION INTERNAL IMPROVEMENT AND REFUNDING BONDS $1,240,000 SERIES P-240 $1,660,000 SERIES R-240 sss:s:::::ssss::ssss:sssssssssass:ssssss:sssasssssssssss:::s:ssss: Kuhn -Cox Printing — Salina. Kansas Section 1. Section 2. Section 3. Section 4. Section 5. Section 6. Section 7. Section 8. Section 9. Section 10. Section 11. Section 12. Section 13. Section 14. Section 15. Section 16. Section 17. Section 18. Section 19. Section 20. Section 21. Section 22. Exhibit A Exhibit B INDEX PAGE Definitions ------------------------------- 2 Authorization of and Security for the Bonds 4 Description of the Bonds, Designation of Paying Agent and Bond Registrar --------- 4 Redemption of Bonds Prior to Maturity ----- 5 Method and Place of Payment of Principal of and Interest on the Bonds --------------- 7 Execution, Authentication and Delivery of theBonds ------------------------------- 8 Registration, Transfer and Exchange of Bonds 9 Persons Deemed Owners of Bonds ------------ 10 Mutilated, Lost, Stolen or Destroyed Bonds 10 Cancellation and Destruction of Bonds Upon Payment ---------- ------------------ 11 Form of Bonds ----------------------------- 11 Disposition of Bond Proceeds -------------- 11 Levy and Collection of Annual Taxes and Assessments ----------------------------- 11 Transfer of Funds to Paying Agent and the Bond Registrar -------------------------- 12 Authorization of Agreement Between the City and the Bond Registrar ------------- 12 Tax Covenants ----------------------------- 12 Defeasance -------------------------------- 13 Approval of Preliminary Official Statement and Official Statement ------------------ 13 Redemption of Refunded Bonds -------------- 14 Redemption of Temporary Notes-------------- 14 Severability ------------------------------ 14 Effective Date ---------------------------- 14 Kinn -Cox Prinlinq — Sabina. Kansas PO she iN I%e S'a�i/VLt j-'ru¢l /I/07 ORDINANCE NO. 92- 9.0y AN ORDINANCE AUTHORIZING AND DIRECTING THE ISSUANCE, SALE AND DELIVERY OF $2,900,000 PRINCIPAL AMOUNT OF GENERAL OBLIGATION INTERNAL IMPROVEMENT AND REFUNDING BONDS OF THE CITY OF SALINA, KANSAS, SERIES P-240 BEING FOR THE PURPOSE OF PROVIDING FUNDS TO PAY THE COST OF THE CONSTRUCTION OF CERTAIN STREET IMPROVEMENTS IN THE CITY AND SERIES R-240 BEING FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND A PORTION OF THE CITY'S OUTSTANDING GENERAL OBLIGATION BONDS; PRESCRIBING THE FORM AND DETAILS OF SAID BONDS; PROVIDING FOR THE LEVY AND COLLECTION OF THE NECESSARY TAXES FOR THE PURPOSE OF PAYING THE PRINCIPAL OF AND INTEREST ON SAID BONDS AS THEY BECOME DUE; AUTHORIZING AN AGREEMENT BETWEEN THE CITY AND THE BOND REGISTRAR; APPROVING THE PRELIMINARY AND FINAL OFFICIAL STATEMENTS AND REDEEMING OUTSTANDING TEMPORARY NOTES. WHEREAS, pursuant to K.S.A. 12-685 et seq., as amended, and other provisions of the laws of the State of Kansas applicable thereto, by proceedings duly had, the governing body of the City of Salina, Kansas (the "City"), has proceeded with construction of certain street improvements in the City; and WHEREAS, the City has previously issued its temporary notes to finance the costs of said improvements on an interim basis; and WHEREAS, all legal requirements pertaining to said improvements have been complied with, and the governing body of the City now finds and determines that the total cost of the aforesaid improvements and related expenses (including interest on the aforesaid temporary notes and issuance costs of the bonds herein authorized) is $1,240,000; and WHEREAS, the governing body of the City is authorized by law to issue general obligation bonds of the City to pay the costs of said improvements; and WHEREAS, the City of Salina, Kanss (the "City") has previously issued $8,115,000 principal amount of its General Obligation Refunding Bonds, Series 1985, now outstanding in the aggregate principal amount of $1,835,000 (the "Refunded Bonds") for the purpose of refunding certain outstanding general obligation bonds of the City; and WHEREAS, the City is authorized by K.S.A. 10-427 et seq. to issue general obligation refunding bonds of the City for the purpose of refunding the Refunded Bonds; and WHEREAS, in order to achieve interest cost savings, to and to provide a more economical and efficient program for the retirement of the indebtedness represented by the. Refunded Bonds, it has become desirable and in the best interest of the City and its inhabitants to refund the Refunded Bonds; and Kuhn CO% Printing — Salina. Kansas WHEREAS, the governing body of the City now deems and finds it necessary to authorize the issuance of the aforesaid bonds for delivery to the purchaser thereof; NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF SALINA, KANSAS, AS FOLLOWS: Section 1. Definitions. In addition to the words and terms otherwise defined herein, unless the context shall clearly indicate some other meaning, the words and terms defined in this Section shall for all purposes of this Ordinance have the respective meanings specified in this Section, to wit: "Bondholder" and "Holder" mean a Person in whose name a Bond is registered in the Bond Register. "Bond Register" means the register and all accompanying records kept by the Bond Registrar evidencing the registration, transfer and exchange of Bonds. "Bond Registrar" means the State Treasurer of Kansas when acting in the capacity as registrar and transfer agent for the registration, transfer and exchange of Bonds, and any successors thereto. "Bonds" means collectively the Series P-240 and Series R-240 general obligation Bonds, of the City in the aggregate principal amount of $2,900,000 herein authorized. "City" means Salina, Kansas. "Escrow Account" means the Salina, Kansas, Escrow Account for Refunded Bonds, created in the Escrow Trust Agreement. "Escrow Trust Agreement" means the Escrow Trust Agreement, dated as of April 15, 1992, between the City and the Escrow Trustee. "Escrow Trustee" means First National Bank and Trust, Salina, Kansas, and its successors and assigns. "Interest Payment Date" means the Stated Maturity of an installment of interest on the Bonds. "Maturity" with respect to any Bond means the date on which the principal of such Bond becomes due and payable as therein or herein provided. "Ordinance", "this Ordinance", "hereof", "herein", "hereto" and similar terms shall refer to this Ordinance of the City authorizing the Bonds, as originally executed or as it may be supplemented or amended from time to time. -2- Kinn -Cox Priming — Salina. Kansas "Outstanding" when used with respect to Bonds means, as of the date of determination, all Bonds theretofore executed, authenticated and delivered under this Ordinance, except: (i) Bonds theretofore cancelled by the Bond Registrar or delivered to the Bond Registrar for cancellation; (ii) Bonds that have been defeased by the deposit of funds or qualified securities with the Paying Agent or other qualified party in compliance with this Ordinance; and (iii) Bonds in exchange for or in lieu of which other Bonds have been authenticated and delivered pursuant to this Ordinance. "Paying Agent" means the State Treasurer of Kansas when acting in the capacity as paying agent for the payment of the principal of, premium, if any, and interest on the Bonds and any successors thereto. "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Project" means the construction of certain street improvements in the City. "Redemption Date" when used with respect to any Bond to be redeemed means the date fixed for redemption pursuant to this Ordinance. "Refunded Bonds" means the General Obligation Refunding Bonds, Series 1985, maturing in the years 1992 to 1996, in the aggregate principal amount of $1,835,000. "Refunded Bond Ordinance" means Ordinance No. 85-9101 of the City adopted on October 21, 1985, which authorized the Refunded Bonds. "Registration Date" means the effective date of registration of a Bond as evidenced by the Bond Registrar in the Certificate of Authentication appearing on the Bond. "Regular Record Date" for the interest payable on any Interest Payment Date means the 15th day (whether or not a business day) of the calendar month next preceding such Interest Payment Date. "Series P-240" means the $1,240,000 original principal amount of the General Obligation Internal Improvement Bonds, Series P-240, authorized according to the terms provided in this Ordinance. -3- K— C,a P—t­ — Salina, Kansas "Series R-240" means the $1,660,000 original principal amount of the General Obligation Refunding Bonds, Series R-240, authorized according to the terms provided in this Ordinance. "Special Record Date" for the payment of any Defaulted Interest, as defined in Section 5, means a date fixed by the Bond Registrar pursuant to Section 5. "Stated Maturity" when used with respect to any Bond or any installment of interest thereon means the date specified in Section 3 of this Ordinance as the fixed date on which the principal of such Bond or such installment of interest is due and payable. Section 2. Authorization of and Security for the Bonds. There is hereby authorized an issue of general obligation bonds of the City in the aggregate principal amount of $2,900,000, to be issued in two series. For the purpose of providing funds for the Project, there shall be issued and are hereby authorized and directed to be issued the General Obligation Internal Improvement Bonds, Series P-240, of the City in the principal amount of $1,240,000. For the purpose of refunding the Refunded Bonds, there shall be issued and are hereby authorized and directed to be issued the General Obligation Refunding Bonds, Series R-240, of the City in the principal amount of $1,660,000. The Bonds shall be general obligations of the City, payable as to both principal and interest from ad valorem taxes which may be levied without limitation as to rate or amount upon all the taxable tangible property within the territorial limits of the City. The full faith, credit and resources of the City are hereby irrevocably pledged for the payment of the Bonds and the interest thereon as the same become due. Section 3. Description of the Bonds, Designation of Paying Agent and Bond Registrar. The Bonds shall consist of fully registered Bonds, without coupons, transferable to subsequent owners only in the Bond Register maintained by the Bond Registrar as hereinafter provided. Each Bond shall be in the denomination of $5,000 or any integral multiple thereof, not exceeding the principal amount of Bonds maturing in the year in which such Bond becomes due, as specified by the Holder of such Bond. The Bonds shall be numbered in a manner determined by the Bond Registrar. The Bonds shall be dated as of May 1, 1992. The Series P-240 Bonds shall mature and shall bear interest at the rates per annum as follows: -4- Kuhn -Cox Priming — Salina, Kansas SERIES P-240 The Series R-240 Bonds shall mature without option of prior payment and shall bear interest at the rates per annum as follows: SERIES R-240 PRINCIPAL PRINCIPAL INTEREST MATURITY RATE AMOUNT RATE October 1, 1993 $120,000 3.75% October 1, 1994 120,000 4.20% October 1, 1995 125,000 4.65% October 1, 1996 125,000 4.90% October 1, 1997 125,000 5.10% October 1, 1998 125,000 5.30% October 1, 1998 125,000 5.50% October 1, 2000 125,000 5.70% October 1, 2001 125,000 5.80% October 1, 2002 125,000 5.90% The Series R-240 Bonds shall mature without option of prior payment and shall bear interest at the rates per annum as follows: SERIES R-240 The Bonds shall bear interest from the most recent Interest Payment Date to which interest has been paid in full or, if no interest has been paid, from May 1, 1992. Interest on the Bonds at the rates aforesaid shall be payable semiannually on April 1 and October 1 in each year, beginning April 1, 1993. The State Treasurer of Kansas, Topeka, Kansas, is hereby designated as the Paying Agent and as the Bond Registrar for the Bonds. Section 4. Redemption of Bonds Prior to Maturity. The Series R-240 Bonds are not subject to redemption and payment prior to their Stated Maturity. The Series P-240 Bonds maturing on October 1, 2000, and thereafter shall be subject to redemption and payment prior to their Stated Maturity at the option of the City as a whole or in part on October 1, 1999, or on any Interest Payment Date thereafter in inverse order of Stated Maturity, at the redemption price of 100% of the principal amount of Bonds redeemed and paid plus accrued interest to the Redemption Date, without a premium. Q•1E PRINCIPAL INTEREST MATURITY AMOUNT RATE April 1, 1993 $260,000 3.50% October 1, 1993 300,000 3.75% April 1, 1994 250,000 4.00% October 1, 1994 250,000 4.20% April 1, 1995 215,000 4.50% October 1, 1995 225,000 4.65% April 1, 1996 160,000 4.90% The Bonds shall bear interest from the most recent Interest Payment Date to which interest has been paid in full or, if no interest has been paid, from May 1, 1992. Interest on the Bonds at the rates aforesaid shall be payable semiannually on April 1 and October 1 in each year, beginning April 1, 1993. The State Treasurer of Kansas, Topeka, Kansas, is hereby designated as the Paying Agent and as the Bond Registrar for the Bonds. Section 4. Redemption of Bonds Prior to Maturity. The Series R-240 Bonds are not subject to redemption and payment prior to their Stated Maturity. The Series P-240 Bonds maturing on October 1, 2000, and thereafter shall be subject to redemption and payment prior to their Stated Maturity at the option of the City as a whole or in part on October 1, 1999, or on any Interest Payment Date thereafter in inverse order of Stated Maturity, at the redemption price of 100% of the principal amount of Bonds redeemed and paid plus accrued interest to the Redemption Date, without a premium. Q•1E Kuhn C11 Priming — Sallhe. Kansas The Bond Registrar shall call Series P-240 for redemption and payment as herein provided upon receipt by the Bond Registrar at least 45 days prior to the Redemption Date of a written request of the City. Series P-240 Bonds shall be redeemed in inverse order of Stated Maturity in the principal amount of $5,000 or any integral multiple thereof. In the case of a partial redemption of Series P-240 Bonds of the same Stated Maturity, the Series P-240 Bonds to be redeemed shall be selected by the Bond Registrar from the Outstanding Series P-240 Bonds of that Stated Maturity by such method as the Bond Registrar shall deem fair and appropriate and which may provide for the selection for redemption of portions of the principal of Outstanding Series P-240 Bonds of that maturity of a denomination larger than $5,000. The portions of the principal of Outstanding Series P-240 Bonds so selected for partial redemption shall be equal to $5,000 or integral multiples thereof. Any Series P-240 Bond which is to be redeemed only in part shall be submitted to the Paying Agent and delivered to the Bond Registrar, who shall authenticate and deliver to the Holder of such Series P-240 Bond, without service charge, a new Series P-240 Bond or Bonds, of any authorized denomination as requested by such Holder in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Series P-240 Bond so surrendered. If the Holder of any such Series P-240 Bond of a denomination greater than $5,000 shall fail to present such Series P-240 Bond to the Paying Agent for payment and exchange as aforesaid, such Series P-240 Bond shall, nevertheless, become due and payable on the Redemption Date to the extent of the principal amount of such Series P-240 Bond called for redemption (and to that extent only). If and when the City shall call any of the Series P-240 Bonds for redemption and payment prior to the maturity thereof, the Bond Registrar shall give written notice in the name of the City of its intention to redeem and pay such Series P-240 Bonds at the office of the Paying Agent. Notice of redemption shall be given by first class mail, postage prepaid, mailed not less than 30 days prior to the Redemption Date, to each Holder of Series P-240 Bonds to be redeemed, at his address appearing in the Bond Registrar. All notices of redemption shall state: (i) The Redemption Date; (ii) The redemption price; (iii) If less than all Outstanding Series P-240 Bonds are to be redeemed, the identification (and, in the case of partial redemption, the respective principal amounts) of the Series P-240 Bonds to be redeemed; -6- Kahn -Cox Printing — Salina, Kansas (iv) That on the Redemption Date, the redemption price will become due and payable upon each such Series P-240 Bond, and that interest thereon shall cease to accrue from and after said date; and (v) The place where such Series P-240 Bonds are to be surrendered for payment of the redemption price (which shall be the office of the Paying Agent). The failure of the Holder of any Series P-240 Bond to be redeemed to receive written notice mailed pursuant hereto shall not affect or invalidate the redemption of said Series P-240 Bond. If any Bond is called for redemption and payment as aforesaid, all interest on such Series P-240 Bond shall cease from and after such redemption date, provided funds are deposited with the Paying Agent for its payment on the Redemption Date at the redemption price. The Bond Registrar is also directed to comply with any mandatory or voluntary standards then in effect for processing redemptions of municipal securities established by the Securities and Exchange Commission. Failure to comply with such standards shall not affect or invalidate the redemption of any Series P-240 Bond to be redeemed. Section 5. Method and Place of Payment of Principal of and Interest on the Bonds. The principal of, premium, if any, and interest (computed on the basis of a 360 -day year of twelve 30 -day months) on the Bonds shall be payable in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts. Payment of the interest on each Bond shall be made by the Paying Agent on each Interest Payment Date to the Person appearing as the Holder thereof in the Bond Register at the close of business on the Regular Record Date next preceding said Interest Payment Date, by check or draft mailed to such Holder at the Holder's address as it appears in the Bond Register. The principal of and redemption premium, if any, each Bond shall be payable to the Holder thereof upon the presentation of such Bond for payment and cancellation at its Maturity at the principal office of the Paying Agent. Notwithstanding any of the foregoing provisions of this Section to the contrary, any interest on the Bonds which is payable, but is not punctually paid on any Interest Payment Date (herein called "Defaulted Interest"), shall be payable to the persons in whose names the Bonds are registered at the close of business on a Special Record Date. The Special Record Date shall be fixed in the following manner: (1) The City shall notify the Bond Registrar in writing of the amount of Defaulted Interest proposed .to be paid on the Bonds and the date of the proposed payment, which proposed payment date shall be at least 30 days after receipt by the Bond Registrar of such notice from the City; (2) at the same time the City shall -7- Kinn -Cox Printing — Sabina. Kansas deposit with the Paying Agent an amount of money equal to the aggregate amount to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Paying Agent for such deposit prior to the date of the proposed payment; and (3) thereupon, the Bond Registrar shall fix a special Record Date for the payment of such Defaulted Interest which shall not be more than 15 nor less than 10 days prior to the date of the proposed payment. The Bond Registrar shall promptly notify the City of such Special Record Date and, in the name and at the expense of the City, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first class postage prepaid, to the Holder of each Bond at the Holder's address as it appears in the Bond Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names the Bonds are registered at the close of business on such Special Record Date. Subject to the foregoing provisions of this Section, each Bond delivered under this Ordinance upon transfer of or in exchange for or in lieu of any other Bond shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Bond. Section 6. Execution, Authentication and Delivery of the Bonds. The Bonds shall be executed on behalf of the City by the facsimile signature of its Mayor and attested by the facsimile signature of its City Clerk, and shall have the seal of the City affixed thereto or imprinted thereon. In the event any officer whose signature or facsimile thereof appears on any Bond shall cease to be such officer before the delivery of such Bond, such signature or facsimile thereof shall nevertheless be valid and sufficient for all purposes, the same as if such person had remained in office until delivery. Any Bond may be executed by such persons as at the actual time of the execution of such Bond shall be the proper officers to sign such Bond although at the original date of such Bond such persons may not have been such officers. The Bonds shall have endorsed thereon a Certificate of Authentication substantially in the form hereinafter set forth and which shall have the date of registration inserted and shall be manually executed by the Bond Registrar. No Bond shall be entitled to any security or benefit under this Ordinance or shall be valid or obligatory for any purpose unless and until such Certificate of Authentication shall have been duly executed by the Bond Registrar by manual signature. Such executed Certificate of Authentication upon any Bond shall be conclusive evidence that such Bond has been duly cm Kinn -Cox P,-,, —Sabina. Kanses authenticated and delivered under this Ordinance and that such registered owner has been entered on record in the Bond Register kept by the Bond Registrar. The Certificate of Authentication shall be deemed to have been duly executed if the Registration Date has been inserted and if it has been signed by any authorized officer or employee of the Bond Registrar, but it shall not be necessary that the same officer or employee sign the Certificate of Authentication on all of the Bonds that may be issued hereunder at any one time. The Mayor and the City Clerk are hereby authorized and directed to prepare and execute the Bonds in the manner hereinbefore specified, the City Clerk is hereby authorized and directed to register the Bonds, and the Mayor and the City Clerk are hereby authorized and directed to cause the Bonds to be registered in the office of the State Treasurer of Kansas as provided by law, and when the Bonds have been duly registered with the Bond Registrar, to deliver the Bonds to the original purchaser thereof, upon the payment of the aggregate principal amount of the Bonds plus accrued interest to the date of payment and delivery, together with any premium. Section 7. Registration, Transfer and Exchange of Bonds. So long as any of the Bonds remain outstanding, the City shall cause the Bond Register to be kept at the principal office of the Bond Registrar and all of the Bonds and transfers and or exchanges thereof shall be fully registered as to both principal and interest in the names of the Holders in the Bond Register and shall not be registered to bearer. Bonds may be transferred in the Bond Register only upon surrender thereof to the Bond Registrar duly endorsed for transfer or accompanied by a written instrument of transfer duly executed by the Holder thereof or his attorney or legal representative in such form as shall be satisfactory to the Bond Registrar. Upon any such transfer, the City shall execute and the Bond Registrar shall authenticate and deliver in exchange for such Bond a new Bond or Bonds, registered in the name of the transferee, of any denomination or denominations authorized by this Ordinance in an aggregate principal amount equal to the principal amount of such Bond, of the same Maturity and bearing interest at the same rate. Bonds, upon surrender thereof at the principal office of the Bond Registrar, together with a written instrument of transfer duly executed by the Holder thereof or his attorney or legal representative in such form as shall be satisfactory to the Bond Registrar, may, at the option of the Holder thereof, be exchanged for an equal aggregate principal amount of Bonds of the same Maturity, of any denomination or denominations authorized by this Ordinance, and bearing interest at the same rate. -9- Kinn-Gox Pooling — Salina_ Kansas In all cases in which Bonds shall be exchanged or transferred hereunder, the City shall execute and the Bond Registrar shall authenticate and deliver at the earliest practicable time Bonds in accordance with the provisions of this Ordinance. All Bonds surrendered in any such exchange or transfer shall forthwith be cancelled by the Bond Registrar. No service charge shall be made to any Bondholder for registration, transfer or exchange of Bonds, but the City or the Bond Registrar may make a charge for every transfer or exchange of Bonds sufficient to reimburse it or them for any tax or other governmental charge required to be paid with respect to such transfer or exchange, and such charges shall be paid before any such transfer or exchange shall be completed. The City and the Bond Registrar shall not be required (i) to issue, transfer or exchange any Bond during a period beginning at the opening of business 15 days preceding the date of mailing of a notice of redemption for Bonds selected for redemption under Section 4 and ending at the close of business on the day of such mailing; (ii) to transfer or exchange any Bond so selected for redemption in whole or in part; or (iii) to issue, transfer or exchange any Bond during a period beginning at the opening of business on the day after receiving written notice from the City of its intent to pay Defaulted Interest and ending at the close of business on the date fixed for the payment of Defaulted Interest pursuant to this Ordinance. Section 8. Persons Deemed Owners of Bonds. The Person in whose name any Bond shall be registered shall be deemed and regarded by the City, the Bond Registrar and the Paying Agent as the absolute owner thereof, whether such Bond shall be overdue or not, for the purpose of receiving payment therefor or on account thereof and for all purposes, and neither the City, the Bond Registrar nor the Paying Agent shall be affected by notice to the contrary. Payment of or on account of the principal of and interest on any Bond shall be made only to or upon the order of the Holder thereof or his legal representative. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond, including the interest thereon, to the extent of the sum or sums so paid. Section 9. Mutilated, Lost, Stolen or Destroyed Bonds. In the event any Bond shall become mutilated, or be lost, stolen or destroyed, the City shall, if necessary, execute and the Bond Registrar shall authenticate and shall deliver a new Bond of like date and tenor as the Bond mutilated, lost, stolen or destroyed; provided that, in the case of any mutilated Bond, such mutilated Bond shall first be surrendered to the Bond Registrar, and in the case of any lost, stolen or destroyed Bond, if the requirements of K.S.A. 84-8-405 are met and if an indemnity bond and affidavit of loss are provided to the Bond Registrar and the City at the expense of the Holder. Such -10- Kuhn-Cnx — Saiz a. Ken indemnity bond and affidavit of loss must be sufficient, in the judgment of the Bond Registrar and the City, to protect the Bond Registrar and the City from any loss which either of them might suffer if the Bond is replaced. In the event any such Bond shall have matured, instead of issuing a substitute Bond the City may pay or authorize the payment of the same without surrender thereof. Upon the issuance of any substitute Bond, the City and the Bond Registrar may require the payment of an amount sufficient to reimburse the City and the Bond Registrar for any tax or other governmental charge that may be imposed in relation thereto and any other reasonable fees and expenses incurred in connection therewith. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, lost, stolen or destroyed Bonds. Section 10. Cancellation and Destruction of Bonds Upon Payment. All Bonds surrendered for payment, transfer or exchange shall be delivered to the Bond Registrar and, if not already cancelled, the Bond Registrar shall cancel such Bonds and record such cancellation in the Bond Register. Thereafter, such cancelled Bonds shall be delivered to the City. Section 11. Form of Bonds. The Bonds and the Bond Registrar's Certificate of Authentication to be endorsed thereon shall be in substantially the form attached hereto as Exhibit "A". The Bonds may have endorsed thereon such legends or text as may be necessary or appropriate to conform to any applicable rules and regulations of any governmental authority or any custom, usage or requirement of law with respect thereto. Section 12. Disposition of Bond Proceeds and Other Funds. All accrued interest and premium, if any, received from the sale of the Bonds shall be deposited in the general obligation bond fund held by the City Treasurer for the retirement of the Bonds. The remaining balance of the proceeds derived from the sale of the Series P-240 Bonds shall be deposited in a fund held by the City Treasurer and shall be used solely for the purpose of paying the costs of the Project, including the retirement of any temporary notes issued with respect to the Project. The remaining balance of the proceeds derived from the sale of the Series R-240 Bonds shall be deposited in the Escrow Account held by the Escrow Trustee. The City shall, simultaneously with the issuance of the Bonds, transfer from funds of the Issuer on hand and available for such purpose to the Escrow Account the sum set forth in the Escrow Trust Agreement to be applied as set forth in the Escrow Trust Agreement. Section 13. Levy and Collection of Annual Taxes and Assessments. The governing body of the City shall annually -11- Kuhn -C- Printing — 5,1—. Kansas make provision for the payment of the principal of and interest on the Bonds as the same become due by levying and collecting the necessary taxes and assessments therefor in the manner provided by law. Section 14. Transfer of Funds to Paying Agent and the Bond Registrar. The City Treasurer is hereby authorized and directed to withdraw from the funds received in payment of the taxes and special assessments and from the debt service fund of the City and forward to the Paying Agent sums sufficient to pay the principal of and interest on the Bonds as and when the same become due and to pay the charges of the Paying Agent for acting as paying agent in the payment of principal and interest. In addition, the City Treasureris hereby authorized and directed to withdraw from the debt service fund and forward to the Bond Registrar sums sufficient to pay the charges of the Bond Registrar for acting as bond registrar. Sums sufficient to pay said charges shall be forwarded to the Paying Agent and Bond Registrar over and above the amount of the principal of and interest on the Bonds. Section 15. Authorization of Agreement Between the City and the Bond Registrar, Escrow Trust Agreement and Bond Purchase Agreement. The Agreement between the City and the State Treasurer of Kansas, in substantially the form attached hereto, with respect to the duties of the State Treasurer as Bond Registrar is in all respects hereby approved, authorized and confirmed and the Mayor and City Clerk are hereby authorized and directed to execute said Agreement for and on behalf of the City. The Escrow Trust Agreement between the City and the Escrow Trustee, in substantially the form attached hereto, with respect to the payment of the Refunded Bonds, is in all respects hereby approved, authorized and confirmed and the Mayor and City Clerk are hereby authorized and directed to execute said Escrow Trust Agreement Agreement for and on behalf of the City. The Mayor and the City Clerk are hereby authorized to enter into the Bond Purchase Agreement between the City and George K. Baum & Company (the "Original Purchaser") in substantially the form submitted to the governing body concurrently with the passage of this Ordinance, under which the City agrees to sell the Bonds to the Original Purchaser at a purchase price equal to the principal amount plus accrued interest thereon, upon the terms and conditions set forth therein, with such changes therein as shall be approved by the Mayor and the City Clerk, which officers are hereby authorized to execute such document for and on behalf of the City, such officers' signatures thereon being conclusive evidence of their approval thereof. -12- KuhlGox Prinlrng — Sabina. Kanses Section 16. Tax Covenants. (a) The City covenants and agrees that (1) it will comply with all applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"), including Sections 103 and 141 through 150, necessary to maintain the exclusion from gross income for federal income tax purposes of the interest on the Bonds and (2) it will not take any action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from gross income of the interest on the Bonds. The City will, in addition, adopt such other ordinances or resolutions and take such other actions as may be necessary to comply with the Code and with all other applicable future laws, regulations, published rulings and judicial decisions, in order to ensure that the interest on the Bonds will remain excluded from federal gross income, to the extent any such actions can be taken by the Issuer. (b) The City covenants and agrees that (1) it will comply with all requirements of Section 148 of the Code to the extent applicable to the Bonds, (2) it will use the proceeds of the Bonds as soon as practicable and with all reasonable dispatch for the purposes for which the Bonds are issued and (3) it will not invest or directly or indirectly use or permit the use of any proceeds of the Bonds or any other funds of the City in any manner, or take or omit to take any action, that would cause the Bonds to be "arbitrage bonds" within the meaning of Section 148(a) of the Code. (c) The City covenants and agrees that it will expend all of the proceeds of the Bonds within six months of the date of issuance of the Bonds in accordance with the provisions of Section 148(f)(4)(B)(i) of the Code. (d) The foregoing covenants shall remain in full force and effect notwithstanding the defeasance of the Bonds pursuant to Section 17 of this Ordinance until the final maturity date of all Bonds Outstanding. Section 17. Defeasance. When all of the Bonds shall have been paid and discharged, then the requirements contained in this Ordinance and all other rights granted hereby shall terminate. Bonds shall be deemed to have been paid and discharged within the meaning of this Ordinance if there shall have been deposited with the Paying Agent or with a bank located in the State of Kansas and having full trust powers, at or prior to the Stated Maturity of said Bonds, in trust for and irrevocably appropriated thereto, moneys and/or direct obligations of, or obligations the principal of and interest on which are guaranteed by, the United States of America, or in evidences of ownership of such obligations, which, together with the interest to be earned on any such obligations, will be sufficient for the payment of the principal of said Bonds and interest accrued to the Stated Maturity, or if default in such -13- Kuhn-Gox Prn nq — Sal ne Kensas payment shall have occurred on such date, then to the date of the tender of such payments. Any moneys and obligations which at any time shall be deposited with said Paying Agent or bank 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 Paying Agent or bank 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. All moneys deposited with said Paying Agent or bank shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance. Section 18. Approval of Preliminary Official Statement and Official Statement. The Preliminary Official Statement dated April 13, 1992, a copy of which has been submitted to and reviewed by the Governing Body of the City, was final within the meaning of Rule 15c2-12 under the Securities Exchange Act of 1934 except for the omission of information relating to offering prices, interest rates, delivery dates, any other terms or provisions required to be specified in the bid for the Bonds, other terms of the Bonds depending on such matters and the identity of the successful bidder for the Bonds, and the information therein was accurate and complete. Said Preliminary Official Statement and the final Official Statement, in substantially the form of the Preliminary Official Statement, and the public distribution of the same by the underwriters of the Bonds is hereby approved. The Mayor of the City is hereby authorized and directed to execute and deliver said final Official Statement on behalf of the City with such changes therein or amendments or supplements thereto as shall be approved by the Mayor, the Mayor's execution thereof to be conclusive evidence of said representative's approval thereof. Section 19. Redemption of Refunded Bonds. The Refunded Bonds shall be called for redemption and redeemed and paid on October 1, 1992. Section 20. Redemption of Temporary Notes. The redemption on May 21, 1992, of the following temporary notes issued to finance the Project pending the issuance of the Bonds is hereby ratified and confirmed: Maturity Series Name Amount Dated Date Date PT -106 $202,000 12/01/91 PT -107 $255,000 12/01/91 -14- 12/31/93 12/31/93 Holder BANK IV Wichita, N.A. Wichita, Kansas BANK IV Wichita, N.A. Wichita, Kansas Kuhn-Coz Peinung — Salina Kangas The giving of the notice of redemption of such notes, in accordance with the resolutions issuing such notes, by the City Clerk is hereby ratified and confirmed such redemption date being in substantially the form attached hereto as Exhibit "B". Section 21. Severability. If any one or more of the covenants or agreements provided in this Ordinance (including the exhibits hereto) on the part of the City should be contrary to law, then such covenant or covenants or agreement or agreements shall be deemed severable from the remaining covenants and agreements, and shall in no way affect the validity of the other provisions of this Ordinance or of said exhibits. It shall not be necessary for said exhibits to be published in the official City newspaper, but all such exhibits shall be on file in the office of the City Clerk and shall be available for inspection by any interested party. Section 22. Effective Date. This Ordinance shall take effect and be in full force from and after its publication in the official City newspaper. PASSED by the governing body of the City of Salina, Kansas, this day of April, 1992. (SEAL). 441r� ATTEST: " ayor Sl' kA) tk-, City Clerk -15- Kuhn -Cox Prinhng — 8111 , Kansas REGISTERED NUMBER EXHIBIT A UNITED STATES OF AMERICA STATE OF KANSAS COUNTY OF SALINE CITY OF SALINA REGISTERED GENERAL OBLIGATION [INTERNAL IMPROVEMENT] [REFUNDING] BOND SERIES [P-240] [R-240] Interest Maturity Bond Rate Date Date CUSIP % Per Annum May 1, 1992 REGISTERED HOLDER: PRINCIPAL AMOUNT: DOLLARS The City of Salina, in the County of Saline, State of Kansas (herein called the "City"), for value received, hereby promises to pay to the Registered Holder identified above, or registered assigns, on the Maturity Date identified above, the Principal Amount identified above and to pay interest thereon at the Interest Rate specified above from the most recent Interest Payment Date to which interest has been paid in full or, if no interest has been paid, from May 1, 1992, semiannually on April 1 and October 1 in each year, beginning April 1, 1993. INTEREST on this Bond will be paid by check or draft mailed to the person in whose name this Bond (or one or more predecessor Bonds) is registered in the Bond Register maintained by the Bond Registrar at the close of business on the fifteenth day of the month nest preceding each interest payment date (the Regular Record Date). Interest not punctually paid will be paid as otherwise provided in the ordinance authorizing this Bond (the "Ordinance"). The Principal Amount of this Bond shall be payable by check or draft to the Registered Holder upon presentation and surrender hereof at the principal office of the State Treasurer of Kansas, in the City of Topeka, Kansas. The full faith, credit and resources of the City are hereby irrevocably pledged for the prompt payment of the principal of and interest on this Bond as the same become due. The principal of and interest (computed on the basis of a 360 -day year of twelve 30 -day months) on this Bond are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. Kuhn -Cox Printing — Salina, Kansas REFERENCE IS MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF. SUCH PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE. THIS BOND shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Ordinance until the Certificate of Authentication hereon shall have been dated and executed by the Bond Registrar. 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 done and performed and do exist in due and regular form and manner as required by the constitution and laws of the State of Kansas, and that the total indebtedness of the City, including this Bond and the series of which it is one, does not exceed any constitutional or statutory limitation. IN WITNESS WHEREOF, the governing body of the City of Salina, Kansas, has caused this Bond to be signed by facsimile signature of its Mayor and attested by facsimile signature of its City Clerk, the City's corporate seal to be printed hereon and this Bond to be dated May 1, 1992. ATTEST: (facsimile) City Clerk CITY OF SALINA, KANSAS By (facsimile) Mayor Registration No. P-240: 0322-085-050192-087 R-240: 0322-085-050192-088 CERTIFICATE OF AUTHENTICATION REGISTRATION DATE: This Bond is one of the Bonds described in the within mentioned Ordinance. OFFICE OF THE STATE TREASURER OF KANSAS Bond Registrar By Bond Registrar and Paying Agent: STATE TREASURER OF KANSAS Kuhn Cox Priming — Salina_ Ka—, [ON REVERSE SIDE] THIS BOND is one of an authorized series of fully registered bonds of the City designated "General Obligation [Internal Improvement] [Refunding] Bonds, Series [P-240] [R-240]", aggregating the principal amount of [$1,240,000] [$1,660,000] (the "Bonds"), issued by the City for the purpose of providing funds to [pay the cost of the construction of certain street improvements in the City] [refund certain outstanding general obligation bonds of the City], under the authority of and in full compliance with the constitution and laws of the State of Kansas, including K.S.A. 10-101 et seq. [and 12-685 et seg.,] [K.S.A. 10-427 et seq. and K.S.A. 10-620 et seg.,] as amended and supplemented and all laws amendatory thereof and supplemental thereto, and pursuant to ordinances duly passed and proceedings duly and legally had by the governing body of the City. THE BONDS are general obligations of the City, payable as to principal and interest from ad valorem taxes which may be levied without limitation as to rate or amount upon all taxable tangible property within the territorial limits of the City. THE BONDS [maturing on October 1, 2000, and thereafter are subject to redemption and payment prior to maturity, at the option of the City, as a whole or in part on October 1, 1999, or on any interest payment date thereafter, at the redemption price of 100% of the principal amount of Bonds redeemed and paid plus accrued interest to the redemption date, without a premium. Bonds to be redeemed and paid pursuant to the provisions described above shall be redeemed in inverse order of maturity, Bonds of less than a full maturity to be selected by the Bond Registrar in such manner as it shall deem fair and appropriate.] [are not subject to redemption prior to their Stated Maturities.] [IN THE EVENT any of the Bonds are called for redemption as aforesaid, written notice thereof will be given by first class mail mailed not less than 30 days prior to the redemption date to each Registered Holder of Bonds to be redeemed. All Bonds so called for redemption will cease to bear interest on the specified redemption date provided funds or certain securities in which such funds are invested for their redemption are on deposit with the Paying Agent on such redemption date, and will no longer be secured by the Ordinance and will not be deemed to be outstanding under the provisions of the Ordinance.] THIS BOND is transferable only in the Bond Register at the office of the Bond Registrar upon surrender of this Bond to the Bond Registrar duly endorsed for transfer or accompanied by a written instrument of transfer satisfactory to the Bond Registrar duly executed by the Registered Holder hereof or his attorney or legal representative, and thereupon a new Bond or Bonds in the same aggregate principal amount shall be issued to the transferee in exchange therefor, subject to the conditions as provided in the Ordinance. The Bonds for each maturity are issuable only in Kuhn -Co. P-11 g — Salina. Kensas the form of fully registered Bonds without coupons in the denomination of $5,000 or any integral multiple thereof. The Registered Holder of any Bond or Bonds may surrender the same in exchange for an equal aggregate principal amount of Bonds of any authorized denomination in the manner and subject to the conditions as provided in the Ordinance. No service charge shall be made for any such transfer or exchange, but, prior to any transfer or exchange, the Registered Holder hereof shall pay to the City or the Bond Registrar an amount sufficient to reimburse it or them for any tax or other governmental charge required to be paid with respect to such transfer or exchange. The City, the Bond Registrar and the Paying Agent may deem and treat the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal hereof and interest due hereon and for all other purposes. If the date for making any payment of interest or principal occurs on a Saturday or Sunday or a holiday in the City of Topeka, Kansas, then such payment may be made on the next succeeding business day with the same force and effect. (FORM OF ASSIGNMENT) FOR VALUE RECEIVED the undersigned does (do) hereby sell, assign and transfer to (Name and Address) (Social Security or Taxpayer Identifying No.) the Bond to which principal amount of undersigned on the does (do) this assignment is affixed in the outstanding books of the hereby standing in the name of the State Treasurer. The undersigned revocably constitute and appoint transfer the said Bond, on the books with full power of substitution in the Dated attorney to of said State Treasurer, premises. Name Account No. Signature (Sign Here Exactly as Name or Names Appear on the Face of the Certificate) (Signature Guarantee) Kuhn-Cox Printing — Salina, K STATE OF KANSAS ) SS. COUNTY OF SALINE ) I, Jacqueline Shiever, City Clerk of the City of Salina, Kansas, do hereby certify that this Bond has been duly registered in my office according to law. WITNESS my hand and official seal this May 1, 1992. [SEAL] City Clerk (FORM OF STATE TREASURER'S CERTIFICATE) OFFICE OF THE STATE TREASURER OF KANSAS I, SALLY THOMPSON, Treasurer of the State of Kansas, do hereby certify that a transcript of the proceedings leading up to the issuance of this Bond has been filed in my office and that this Bond was registered in my office according to law this WITNESS my hand and official seal. [SEAL] (facsimile) State Treasurer of Kansas K—.. Cor Printing — Serine_ K-11 EXHIBIT B BANK IV Wichita, N.A. Attention: Investment Department P.O. Box 4 Wichita, Kansas 67201 As the owner of the Municipal Temporary Note, Series PT -106, and Municipal Temporary Note, Series PT -107, of the City of Salina, Kansas (the "City"), maturing December 31, 1993, and in the total aggregate principal amount of $457,000 (the "Notes"), you are hereby notified that the Notes have been called for redemption and payment in full on May 21, 1992 (the "Redemption Date"), at a redemption price equal to the principal amount thereof, plus accrued interest to the Redemption Date, without premium. On the Redemption Date, the Note will be due and payable at the office of the Treasurer of the City. From and after the Redemption Date, all interest on the note will cease to accrue. Dated: April 21, 1992. CITY OF SALINA, KANSAS By City Clerk Nunn -Cox Ptinling — Sallna, Kansas ESCROW TRUST AGREEMENT BETWEEN SALINA, KANSAS AND FIRST NATIONAL BANK AND TRUST Salina, Kansas as Escrow Trustee DATED AS OF MAY 1, 1992 $1,660,000 GENERAL OBLIGATION REFUNDING BONDS SERIES R-240 _ _ _ _ _ = _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ = = = = = _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ = = = = = _ _ _ _ _ _ ESCROW TRUST AGREEMENT THIS ESCROW TRUST AGREEMENT, dated as of May 1, by and between SALINA, KANSAS, a municipal corporation organized and existing under the laws of the State of Kansas, and First Na tonal Bank and Trust a national banking association with its principal office located in Salina Kansas,sasand having n g full I�trust powers, as Escrow Trustee. WITNESSETH: WHEREAS, the Issuer has heretofore duly authorized and issuedh the Refunded Bonds; and WHEREAS, pursuant to the Ordinance, the Issuer authorized the issuance and delivery of the Bonds for the purpose of providing funds[, together with other funds of the Issuer] and investment earnings thereon, to pay the principal of, redemption premium, if any, and interest on the Refunded Bonds; and WHEREAS, with $1,660,000 of the proceeds of the sale of the Bonds and the sum of $270,000 of the Issuer's funds transferred to the Escrow Trustee in accordance with the Ordinance, the Issuer has purchased the Escrowed Securities and has deposited with the Escrow Trustee such Escrowed Securities and beginning cash in the amount of $ and WHEREAS, the Refunded Bonds mature or are subject to redemption on the dates and in the amounts shown on Schedule II attached hereto and made a part hereof; NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set forth, the parties hereto agree as follows: 1. Definitions. In addition to the definitions contained in the Ordinance, the following words and terms used in this Escrow Agreement shall have the following meanings, unless the context or use indicates another or different meaning: "Agreement" means this Escrow Trust Agreement. " II Bond Payment Date means any date on which any principal of or interest on any of the Refunded Bonds is due and payable, as shown on Schedule II attached hereto. Bonds" meansh t e General Obligation Refunding Bonds Series R-240, of the City in the aggregate rinci al amount of principal 1 $ 660000 authorized by the Ordinance. "Issuer" means Salina, Kansas. "Escrowed Securities" means the direct non -callable obligations of the United States of America listed on Schedule I attached hereto, and any Substitute Escrowed Securities. "Ordinance" means Ordinance No. 92- of the City adopted on April 20, 1992, which authorized the issuance of the Bonds. "Paying Agent" means the paying agent for the Refunded Bonds as designated by the Refunded Bond Ordinance, and any successor(s) at the time acting as paying agent for the Refunded Bonds. "Refunded Bond Ordinance" means Ordinance No. 85-9101 of the City adopted on October 21, 1985, which authorized the Refunded Bonds. "Refunded Bonds" means the General Obligation Refunding Bonds, Series 1985, maturing in the years 1993 to 1996, inclusive, in the aggregate principal amount of $1,835,000. "Redemption Date" means October 1, 1992. "SLGS" means United States Treasury Obligations - State and Local Series. 2. Receipt of Ordinances. Receipt of an executed counterpart of the Ordinance and the Refunded Bond Ordinance is hereby acknowledged by the Escrow Trustee, and reference herein to, or citation herein of, any provision of said document shall be deemed to incorporate the same as a part hereof in the same manner and with the same effect as if it were fully set forth herein. 3. Creation of the Escrow Trust Account. The Ordinance created and established with the Escrow Trustee a special and irrevocable trust fund designated the "Salina, Kansas, Escrow Account for Refunded Bonds" to be held in trust in the custody of the Escrow Trustee for and on behalf of the Paying Agent of the Refunded Bonds. The Escrow Trustee shall maintain and administer the Escrow Account as herein provided. An independent certified public accountant or firm of such accountants will have verified that there will be, on any date of calculation, sufficient cash in the Escrow Account to pay all principal of, redemption premium, if any, and interest on the Refunded Bonds on the respective Bond Payment Dates and the Redemption Date. -2- 4. Deposits to the Escrow Trust Account. Concurrently with the execution and delivery of the Bonds and the Issuer's receipt of the proceeds therefrom, the Issuer will forthwith deposit, or cause to be deposited, with the Escrow Trustee, and the Escrow Trustee will acknowledge its receipt and the deposit into the Escrow Account of, the Escrowed Securities and beginning cash in the amount of $ The principal of and interest on such Escrowed Securities and cash so deposited into the Escrow Account shall be designated and credited as set forth on Schedule III to this Agreement. S. Creation of Lien. The Escrow Account shall be irrevocable. The owners of the Refunded Bonds are hereby granted an express lien on, and security interest in, the Escrowed Securities and the cash in the Escrow Account and all earnings thereon until used and applied in accordance with this Agreement. The matured principal of, and earnings on, the Escrowed Securities and any cash in the Escrow Account are hereby pledged and assigned, and shall be applied solely for the payment of the principal of, redemption premium, if any, and interest on the Refunded Bonds. 6. Application of Escrowed Securities and Cash in the Escrow Trust Account. Except as otherwise expressly provided in this Section, the Escrow Trustee shall have no power or duty to invest any moneys held hereunder, or to sell, transfer or otherwise dispose of any Escrowed Securities or cash. (a) On or prior to each Bond Payment Date or Redemption Date, the Escrow Trustee shall withdraw from the Escrow Account an amount equal to the principal of, redemption premium, if any, and interest on the Refunded Bonds becoming due and payable on such Bond Payment Date or Redemption Date, and shall forward such amounts, by Federal Reserve wire transfer, if necessary, to the Paying Agent, so that such funds will reach the office of the Paying Agent on or before 12:00 noon central time on the third business day prior to such Bond Payment Date and the Redemption Date. It is expressly understood by the Escrow Trustee that a portion of the Refunded Bonds shall be called for redemption and payment prior to maturity on the Redemption Date and that the Escrow Trustee shall provide to the Paying Agent timely information so that the Paying Agent may provide for the notice of redemption in substantially the form attached hereto as Exhibit A, in accordance with provisions of the Refunded Bond Ordinance. In order to make the payments required by this Section, the Escrow Trustee is hereby authorized and instructed to redeem or otherwise dispose of Escrowed Securities in which moneys of the Escrow Account are invested. The liability of the Escrow Trustee to make the payments required by this Section shall be limited to the cash and Escrowed Securities in the Escrow Account. -3- TT - ii (b) At the written request of the Issuer and upon compliance with the conditions hereinafter stated, the Escrow Trustee shall, in accordance with the Issuer's instructions, sell, transfer or otherwise dispose of, or request the redemption of, all or any portion of the Escrowed Securities acquired hereunder and to substitute for the Escrowed Securities other direct obligations of, or obligations guaranteed as to timely payment of principal and interest by, the United States of America (the "Substitute Escrowed Securities"), which are not subject to redemption prior to maturity, except at the option of the holder thereof. The Issuer hereby covenants and agrees that it will not request the Escrow Trustee to exercise any of the powers described in the preceding sentence in any manner which, if reasonably expected on the date of issuance of the Bonds, would cause any of the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, and the regulations of the Treasury Department thereunder in effect on the date of such request and applicable to obligations issued on the issuance date of the Bonds. The Escrow Trustee shall purchase such Substitute Escrowed Securities with the proceeds derived from the sale, transfer, disposition or redemption of the Escrowed Securities, together with any other funds available for such purpose. The foregoing transactions may be effected only if: (i) an independent certified public accountant or firm of such accountants shall certify that, after such transaction, the principal amount of, and interest income on, the Substitute Escrowed Securities will, together with any other moneys available for the purpose, be sufficient to pay, as the same become due at maturity, all principal of, or interest on, the Refunded Bonds which have not been previously paid; (ii) the amounts and dates of the anticipated transfers from the Escrow Account to the Paying Agent of the Refunded Bonds will not be diminished or postponed thereby; and (iii) the Escrow Trustee shall receive an opinion of Bond Counsel to the effect that such disposition and substitution or purchase would not cause any of the Bonds or the Refunded Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended, and the regulations of the Treasury Department thereunder in effect on the date of such disposition, substitution or purchase and applicable to obligations issued on the issuance date of the Bonds. (c) After the transfers described above, cash balances remaining in the Escrow Account from redemption of SLGS may, to the extent required or permitted by applicable regulations, be invested by the Escrow Trustee in SLGS, maturing on or prior to the next interest Payment Date on the Refunded Bonds, at the rate of 0.00%. (d) Notwithstanding any other provisions of this Agreement, the Issuer hereby covenants that no part of the proceeds of the Bonds or of the moneys in the Escrow Account shall be used, at any time, directly or indirectly, in a manner which, if such use had been reasonably anticipated on the date of issuance of the Bonds, would have caused any of the Bonds to be "arbitrage bonds" under Section 148 of the Internal Revenue Code of 1986, as amended, and the regulations of the Treasury Department thereunder proposed or in effect at the time of such use and applicable to obligations issued on the date of issuance of the Bonds. (e) Upon the payment in full of the principal of, redemption premium, if any, and interest on the Refunded Bonds, any remaining cash and Escrowed Securities in the Escrow Account, together with any interest thereon, shall be returned to the Issuer. 7. Reserved. 8. Liabilitv of Escrow Trustee. (a) The Escrow Trustee shall provide for the giving of notice of redemption of the Refunded Bonds in accordance with the provisions of the Refunded Bond Ordinance, and in accordance with any other requirements of law or applicable banking or securities regulations. In event of the Escrow Trustee's failure to give notice of redemption as required, the Escrow Trustee shall be liable for any loss, expense or cost to the Issuer, including the payment of additional interest on the Refunded Bonds. (b) The Escrow Trustee shall not be liable for any loss resulting from any investment, sale, transfer or other disposition made pursuant to this Agreement in compliance with the provisions hereof. The Escrow Trustee shall have no lien whatsoever on, or right of set-off with respect to, any of the moneys or Escrowed Securities on deposit in the Escrow Account for the payment of fees and expenses for services rendered by the Escrow Trustee under this Agreement or otherwise. (c) The Escrow Trustee shall not be liable for the accuracy of the calculations as to the sufficiency of the Escrowed Securities and moneys to pay the Refunded Bonds. So long as the Escrow Trustee applies the Escrowed Securities and moneys as provided herein, the Escrow Trustee shall not be liable for any deficiencies in the amounts necessary to pay the Refunded Bonds caused by such calculations. Notwithstanding the foregoing, the Escrow Trustee shall not be relieved of liability arising from, and proximate to, its failure to comply fully with the terms of this Agreement. (c) In the event of the Escrow Trustee's failure to account for any of the Escrowed Securities or moneys received by it, said Escrowed Securities or moneys shall be and remain -5- the property of the Issuer in trust for the owners of the Refunded Bonds and if, for any reason, such Escrowed Securities or moneys are not applied as herein provided, the assets of the Escrow Trustee shall be impressed with a trust for the amount thereof until the required application shall be made. 9. Fees and Costs of the Escrow Trustee. In total consideration of services rendered and expenses incurred therewith the Escrow Trustee acknowledges receipt of the sum of $ concurrently with the execution of this Agreement. 10. Resignation or Removal of Escrow Trustee; Successor Escrow Trustee. The Escrow Trustee at the time acting hereunder may, at any time, resign and be discharged from its duties and responsibilities hereby created by giving written notice to the Issuer not less than sixty (60) days prior to the date when the resignation is to take effect. Such resignation shall take effect immediately upon the occurrence of the following events: (a) the acceptance by the Issuer of the resignation, (b) the appointment of a successor Escrow Trustee (which may be a temporary Escrow Trustee), (c) the acceptance by such successor Escrow Trustee of the terms, covenants and conditions of this Agreement, (d) the transfer of the Escrow Account, including the moneys and Escrowed Securities held therein, to such successor Escrow Trustee, and (e) the completion of any other actions required for the principal of, and interest on, the Escrowed Securities to be made payable to such successor Escrow Trustee rather than to the resigning Escrow Trustee. The Escrow Trustee may be removed at any time by an instrument or concurrent instruments in writing, delivered to the Escrow Trustee and to the Issuer and signed by the holders of a majority in principal amount of the Refunded Bonds then outstanding. The Escrow Trustee may also be removed by the Issuer if the Escrow Trustee fails to make timely payment ment on any Bond Payment Date or Redemption Date of the amounts required to be paid by it on such Bond Payment Date or Redemption Date by this Agreement to the persons specified herein. Any removal Pursuant to this paragraph shall become effective upon the occurrence of the following events: (i) the appointment of a successor Escrow Trustee (which may be a temporary successor Escrow Trustee), (ii) the acceptance by I� such successor Escrow Trustee of the terms, covenants and conditions of this Agreement, (iii) the transfer of the Escrow Trust Account, including the moneys and Escrowed Securities held therein, to such successor Escrow Trustee, and (iv) and the completion of any other actions required for the principal of, and interest on, the Escrowed Securities to be made payable to such successor Escrow Trustee rather than to the Escrow Trustee being removed. In the event that the Escrow Trustee shall resign or be removed, or be dissolved, or shall be in the course of dissolution or liquidation, or otherwise become incapable of acting hereunder, or in case the Escrow Trustee shall be taken under the control of any public officer(s), or of a receiver appointed by a court, the Issuer shall appoint a temporary Escrow Trustee to fill such vacancy until a successor Escrow Trustee shall be appointed by the Issuer in the manner above provided, and any such temporary Escrow Trustee so appointed by the Issuer shall immediately and without further act be superseded by the successor Escrow Trustee so appointed. In the event that no appointment of a successor Escrow Trustee or a temporary successor Escrow Trustee shall have been made by such holders of a majority in principal amount of Refunded Bonds then outstanding or by the Issuer pursuant to the foregoing provisions of this Section within sixty (60) days after written notice of resignation of the Escrow Trustee has been given to the Issuer, the holder of any of the Refunded Bonds or any retiring Escrow Trustee may apply to any court of competent jurisdiction for the appointment of a successor Escrow Trustee, and, thereupon, such court may, after such notice, if any, as it shall deem proper, appoint a successor Escrow Trustee. No successor Escrow Trustee shall be appointed unless such successor Escrow Trustee shall be a corporation with full trust powers, authorized to do business in the State of Kansas (as required by K.S.A. 10-427 and 10-427a, as amended), and organized under the banking laws of the United States or the State of Kansas, and shall have, at the time of appointment, capital and surplus of not less than Ten Million Dollars ($10,000,000). Every successor Escrow Trustee appointed hereunder shall execute, acknowledge and deliver to its predecessor and to the Issuer an instrument in writing accepting such appointment hereunder and, thereupon, such successor Escrow Trustee, without any further act, deed or conveyance, shall become fully vested with all of the rights, immunities, powers, trusts, duties and obligations of its predecessor, but such predecessor shall, nevertheless, on the written request of such successor Escrow Trustee or the Issuer, execute and deliver an instrument transferring to such successor Escrow Trustee all the estates, properties, rights, powers and trusts of such predecessor hereunder, and every predecessor Escrow Trustee shall deliver, to its successor, all securities and moneys held by such predecessor Escrow Trustee. In the event that any transfer, assignment or instrument in writing from the Issuer be required by any successor Escrow Trustee for more fully and certainly vesting in such successor Escrow Trustee the estates, rights, powers and duties hereby vested or intended to be vested in the predecessor Escrow.Trustee, -7- any such transfer, assignment and instrument on request, be executed, acknowledged and Issuer. in writing shall, delivered by the Any corporation into which the Escrow Trustee, or any successor to it of the duties and responsibilities created by this Agreement, may be merged or converted, or with which it or any successor to it may be consolidated, or any corporation resulting from any merger, conversion, consolidation or tax-free reorganization to which the Escrow Trustee or any successor to it shall be aY P art shall Y if satisfactory to the Issuer, be the successor Escrow Trustee under this Agreement, without the execution or filing of any paper or any I! other act on the part of the parties hereto anything herein j to the contrary notwithstanding. In the event of resignation or removal of the Escrow Trustee, a portion of the amount paid to the Escrow Trustee pursuant to the preceding section shall be returned to the Issuer, such portion to be computed by multiplying the fee specified in the preceeding Section by the ratio of the number of months which the trust created by this Agreement will continue from the effective date of such resignation or removal to the entire term of such trust. Of the amount paid to the Escrow Trustee, $ shall be treated as the initial set up fee and is not refundable. 11. Termination. This Agreement shall terminate when all transfers required to be made by the Escrow Trustee under the provisions hereof shall have been made. 12. Severability. If any one or more of the covenants or agreements provided in this Agreement on the part of the Issuer or the Escrow Trustee to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained, and shall in no way affect the validity of the remaining provisions of this Agreement. 13. Successors and Assigns. All of the covenants, promises and agreements in this Agreement contained by or on behalf of the Issuer or by or on behalf of the Escrow Trustee shall be binding upon, and inure to the benefit of, their respective successors and assigns, whether or not so expressed. 14. Governing Law. This Agreement shall be governed by, and be construed in accordance with, the laws of the State of Kansas. 15. Headings. Any headings preceding the text of the several Sections hereof, and any table of contents or marginal notes appended to copies hereof, shall be solely for Z� convenience of reference, and shall not constitute a part of this Agreement, nor shall they affect its meaning, construction or effect. x 16. Counterparts. This Agreement may be executed cuted in several counterparts,any regarded, all or of which shall be for allP ur oses as one original, and shall constitute and be P 9 but one and the same instrument. . e IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be executed by their duly authorized Ij officers or elected official their corporate seals to be officials, and t e P hereunder affixed and attested as of the date first above written. SALINA, KANSAS ATTEST: Clerk in Mayor FIRST NATIONAL BANK AND TRUST Salina, Kansas SCHEDULE I SCHEDULE I TO ESCROW AGREEMENT, DATED AS OF MAY 1, BETWEEN SALINA, KANSAS, AND FIRST NATIONAL BANK AND TRUST, SALINA, KANSAS OC��SSS�xas�xasxxsxxzxxx�xxasaxass liixaxx=- ESCROWED SECURITIES United States Treasury Obligations - State and Local Government Series: 'I TYPE AMOUNT RATE MATURI i SCHEDULE II j SCHEDULE II TO ESCROW AGREEMENT, DATED AS OF MAY 1, BETWEEN SALINA, KANSAS, AND FIRST NATIONAL BANK AND TRUST, SALINA, KANSAS =xz:ss:ax:ssac=::sss==aaxx=asx==�s=scea=�== REFUNDED BONDS MATURITY AMOUNT October 1, 1992 $1,835,000 State Treasurer of the State of Kansas Landon State Office Bldg. 900 Southwest Jackson Suite 201 Topeka, Kansas 66612-1235 RE: CALL FOR REDEMPTION II I SALINA, KANSAS GENERAL OBLIGATION REFUNDING BONDS SERIES 1985, DATED OCTOBER 15, 1985 i ISI You are hereby notified pursuant to K.S.R. 10-129, as amended, and pursuant provisions of Section 10 of Ordinance No. 85-9101 (the "Ordinance") of Salina, Kansas (the "Issuer") that the above mentioned bonds maturing April 11 1993, and thereafter (the "Refunded Bonds"), have been called for redemption and payment on October 1, 1992 (the "Redemption Date"), at the principal office of The Treasurer of the State II of Kansas, (the "Bond Registrar and Paying Agent"). MATURITY PRINCIPAL INTEREST CUSIP DATE —AMOUNT UN RATE NOS. 4/l/93 0 $260,000 8.50a 10/1/93 270,000 8.50% 0 4/1/94 225,000 8.700 10/1/94 235,0008.70% 4/1/ o 95 205,000 8.900 10/1/95 215,000 8.900 4/1/96 160,000 9.00% The Bond Registrar and Paying Agent is hereby requested to notify the registered owner(s) of the call thereof as set forth in the enclosed Notice of Call for Redemption by forthwith mailinga copy thereof t o each registered owner at the PY g e last known address thereof. SALINA, KANSAS BY First National Bank and Trust Salina, Kansas, as Escrow Trustee NOTICE OF CALL FOR REDEMPTION TO THE REGISTERED OWNERS OF SALINA, KANSAS GENERAL OBLIGATION REFUNDING BONDS SERIES 1985, DATED OCTOBER 15, 1985 Notice is hereby given that pursuant to the provisions of Section 10 of Ordinance No. 85-9101 (the "Ordinance") of Salina, Kansas (the "Issuer") that the above mentioned bonds I, maturing April 1, 1993, and thereafter (the 'Refunded Bonds"), have been called for redemption and payment on October 1, 1992 (the "Redemption Date"), at the principal office of The Treasurer of the State of Kansas, (the "Bond Registrar and Paying Agent"). .� y g g ) MATURITY PRINCIPAL INTEREST CUSIP DATE AMOUNT RATE NOS. 4/1/93 $260,000 8.50% 10/1/93 270,000 8.50% 4/1/94 225,000 8.70% 10/1/94 235,000 8.70% 4/1/95 205,000 8.90% 10/1/95 215,000 8.90% 4/1/96 160,000 9.00% On the Redemption Date there shall become due and payable, upon the presentation and surrender of each such Refunded Bond, the redemption price thereof equal to 100% of the principal amount thereof together with interest accrued to the Redemption Date. Interest shall cease to accrue on the Refunded Bonds so called for redemption from and after the v' r redemption are on Redemption Date provided such funds fo P P deposit with the Paying Agent. SALINA, KANSAS BY Treasurer of the State of Kansas, This Notice of Redemption shall be mailed by certified mail to the Treasurer of the State of Kansas, Topeka, Kansas, not less than 45 days prior to the redemption date. Notice may also be given in accordance with guidelines set forth in Securities and Exchange Commission Release No. 34-23856, but such notice is not required by law. The Issuer shall also cause the Paying Agent to notify the registered owners of the Refunded Bonds as provided in K.S.A. 10-129 as amended, and the Ordinance.