COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 070330

 

Authorizing the issuance of General Obligation Improvement and Refunding Bonds, Series 2007A, of the City of Kansas City, Missouri in a principal amount not to exceed $145,000,000.00; prescribing the form and details of said bonds; providing for the levy and collection of an annual tax for the purpose of paying the principal of and interest on said bonds as they become due; and authorizing certain other documents and actions in connection therewith.

 

WHEREAS, the City of Kansas City, Missouri (the City), is authorized under the provisions of Article VI, Section 26 of the Constitution of Missouri, 1945, as amended, and its charter to incur indebtedness and issue and sell general obligation bonds of the City to evidence such indebtedness for lawful purposes, upon obtaining the approval of the required majority of the qualified electors of the City voting on the question to incur such indebtedness; and

 

WHEREAS, pursuant to such authority, a special election was duly held in the City on Tuesday, April 6, 2004 (the 2004 Election), on the question of whether to issue the general obligation bonds of the City in an amount not to exceed $20,000,000 for the purpose of paying for capital improvements for the World War I Museum Project at Liberty Memorial; and

 

WHEREAS, the votes cast at the 2004 Election were duly canvassed as provided by law, and it was found and declared that not less than four‑sevenths of the qualified voters of the City voting at the 2004 Election on said question voted in favor of the issuance of said bonds, the vote on said question having been 27,685 votes for the issuance of said bonds and 16,261 votes against the issuance of said bonds; and

 

WHEREAS, the City has heretofore issued its General Obligation Bonds (World War I Museum Project) Series 2004F in the original principal amount of $10,000,000 to pay for a portion of the World War I Museum Project; and

 

WHEREAS, $10,000,000 principal amount of general obligation bonds so authorized at the 2004 Election for the World War I Museum Project remains unissued, and the City desires to issue a second series of its general obligation bonds in the principal amount not to exceed $10,000,000 for the purpose of financing a portion of the World War I Museum Project; and

 

WHEREAS, pursuant to such authority the 2004 Election was held on the question of whether to issue the general obligation bonds of the City in an amount not to exceed $30,000,000 for the purpose of paying for deferred maintenance and capital infrastructure and improvements for the Kansas City Zoological Garden; and

 

WHEREAS, the votes cast at the 2004 Election were duly canvassed as provided by law, and it was found and declared that not less than four‑sevenths of the qualified voters of the City voting at the 2004 Election on said question voted in favor of the issuance of said bonds, the vote on said question having been 29,789 votes for the issuance of said bonds and 13,896 votes against the issuance of said bonds; and

WHEREAS, the City has heretofore issued its General Obligation Bonds (Zoo Project) Series 2004F in the original principal amount of $10,000,000 to pay for a portion of the Zoo Project; and

 

WHEREAS, $20,000,000 principal amount of general obligation bonds so authorized at the 2004 Election for the Zoo Project remains unissued, and the City desires to issue a second series of its general obligation bonds in the principal amount not to exceed $5,500,000 for the purpose of financing a portion of the Zoo Project; and

 

WHEREAS, pursuant to such authority, the 2004 Election was held on the question of whether to issue the general obligation bonds of the City in an amount not to exceed $250,000,000 for the purpose of paying for deferred maintenance and basic capital infrastructure such as streets, bridges, catch basins and other projects; and

 

WHEREAS, the votes cast at the 2004 Election were duly canvassed as provided by law, and it was found and declared that not less than four‑sevenths of the qualified voters of the City voting at the 2004 Election on said question voted in favor of the issuance of said bonds, the vote on said question having been 31,195 votes for the issuance of said bonds and 13,065 votes against the issuance of said bonds; and

 

WHEREAS, the City has heretofore issued its General Obligation Bonds (Basic Infrastructure Project) Series 2004F in the original principal amount of $60,000,000 to pay for a portion of the Basic Infrastructure Project; and

 

WHEREAS, $190,000,000 principal amount of general obligation bonds so authorized at the 2004 Election for the Basic Infrastructure Project remains unissued, and the City desires to issue a second series of its general obligation bonds in the principal amount not to exceed $64,500,000 for the purpose of financing a portion of the Basic Infrastructure Project; and

 

WHEREAS, the City has heretofore issued its General Obligation Bonds (Streetlight Project) Series 1997B in the original principal amount of $40,000,000, of which $24,995,000 principal amount remains Outstanding; and

 

WHEREAS, the City desires to issue its general obligation bonds for the purpose of currently refunding the Series 1997B Refunded Bonds; and

 

WHEREAS, the City has heretofore issued its General Obligation Bonds (Streetlight Project) Series 2000A in the original principal amount of $59,295,000, of which $40,000,000 principal amount remains Outstanding; and

 

WHEREAS, the City desires to issue its general obligation bonds for the purpose of advance refunding $30,140,000 aggregate outstanding principal amount of the Series 2000A Refunded Bonds with stated maturities of February 1, 2011 through 2017; and

 

WHEREAS, it is hereby found and determined that it is necessary and advisable and in the best interest of the City and its inhabitants at this time to authorize the issuance and delivery of said bonds for the purposes aforesaid;

 

BE IT ORDAINED BY THE COUNCIL OF KANSAS CITY:

 

ARTICLE I

 

DEFINITIONS

 

Section 101. Definitions of Words and Terms. In addition to words and terms defined elsewhere herein, the following words and terms as used in this Ordinance shall have the following meanings:

 

Arbitrage Instructions means the Arbitrage Instructions attached as Exhibit A to the Citys Arbitrage Certificate relating to the Bonds, as the same may be amended or supplemented in accordance with the provisions thereof.

 

Basic Infrastructure Project means, without limitation, the construction, acquisition, renovation equipping and furnishing of the costs for basic capital infrastructure such as streets, bridges, catch basins and other projects.

 

Bond Counsel means Gilmore & Bell, P.C., Kansas City, Missouri, The Martinez Law Firm, LLC, Liberty, Missouri, or other attorneys or firm of attorneys with a nationally recognized standing in the field of municipal bond financing selected by the City.

 

Bond Insurance Policy means, with respect to the Series 2007A Bonds, the financial guaranty insurance policy issued by the Bond Insurer that insures the scheduled payment of the principal of and interest on the Series 2007A Bonds.

 

Bond Insurer or MBIA means MBIA Insurance Corporation, Armonk, New York, a New York stock insurance company, and its successors and assigns.

 

Bond Payment Date means any date on which principal of or interest on any Bond is payable.

 

Bond Register means the books for the registration, transfer and exchange of Bonds kept at the office of the Paying Agent.

 

Bondowner, Owner or Registered Owner when used with respect to any Bond means the Person in whose name such Bond is registered on the Bond Register.

 

Bonds means the General Obligation Improvement and Refunding Bonds, Series 2007A, authorized and issued by the City pursuant to this Ordinance.

 

Business Day means a day other than a Saturday, Sunday or holiday on which the Paying Agent is scheduled in the normal course of its operations to be open to the public for conduct of its banking operations.

 

Cede & Co. means Cede & Co., as nominee name of The Depository Trust Company, New York, New York.

 

Certificate of Final Terms means Exhibit B, executed and delivered by the Mayor pursuant to Section 211 hereof, in substantially the form attached as Exhibit C.

 

City means the City of Kansas City, Missouri, and any successors or assigns.

 

Code means the Internal Revenue Code of 1986, as amended, and the applicable regulations of the Treasury Department proposed or promulgated thereunder.

 

Debt Service Fund means the Series 2007A Debt Service Fund created in Section 501.

 

Defaulted Interest means interest on any Bond which is payable but not paid on any Interest Payment Date.

 

Defeasance Obligations means any of the following obligations:

 

(a) United States Government Obligations that are not subject to redemption in advance of their maturity dates; or

 

(b) obligations of any state or political subdivision of any state, the interest on which is excluded from gross income for federal income tax purposes and which meet the following conditions:

 

(1) the obligations are (i) not subject to redemption prior to maturity or (ii) the trustee for such obligations has been given irrevocable instructions concerning their calling and redemption and the issuer of such obligations has covenanted not to redeem such obligations other than as set forth in such instructions;

 

(2) the obligations are secured by cash or United States Government Obligations that may be applied only to principal of, premium, if any, and interest payments on such obligations;

 

(3) such cash and the principal of and interest on such United States Government Obligations (plus any cash in the escrow fund) are sufficient to meet the liabilities of the obligations;

 

(4) such cash and United States Government Obligations serving as security for the obligations are held in an escrow fund by an escrow agent or a trustee irrevocably in trust;

 

(5) such cash and United States Government Obligations are not available to satisfy any other claims, including those against the trustee or escrow agent; and

 

(6) the obligations are rated in the highest rating category by Moodys presently Aaa) or Standard & Poors Ratings Services (presently AAA).

 

Director of Finance means the Director or any Acting Director of the Department of Finance of the City.

 

Escrow Agent means UMB Bank, N.A., in its capacity as escrow agent with respect to the Series 2000A Refunded Bonds, and its successors and assigns.

 

Escrow Agreement means the Escrow Deposit Agreement dated as of April 1, 2007 between the City and the Escrow Agent with respect to the Series 2000A Refunded Bonds.

 

Interest Payment Date means the Stated Maturity of an installment of interest on any Bond.

 

Maturity when used with respect to any Bond means the date on which the principal of such Bond becomes due and payable as therein and herein provided, whether at the Stated Maturity thereof or by call for redemption or otherwise.

 

Ordinance means this Ordinance as from time to time amended in accordance with the terms hereof.

 

Outstanding means, when used with reference to Bonds, as of any particular date of determination, all Bonds theretofore authenticated and delivered hereunder, except the following Bonds:

 

(a) Bonds theretofore cancelled by the Paying Agent or delivered to the Paying Agent for cancellation;

 

(b) Bonds deemed to be paid in accordance with the provisions of Section 701 hereof; and

 

(c) Bonds in exchange for or in lieu of which other Bonds have been authenticated and delivered hereunder.

 

Participants means those financial institutions for whom the Securities Depository effects book-entry transfers and pledges of securities deposited with the Securities Depository, as such listing of participants exists at the time of such reference.

 

Paying Agent means the paying agent designated in Section 203 hereof and any successors or assigns thereto.

 

Permitted Investments means any of the following securities, if and to the extent the same are at the time legal for investment of the moneys held in the funds and accounts listed in Section 501 hereof:

 

(a) United States Treasury Securities (Bills, Notes, Bonds and Strips).Obligations of the United States government for which the full faith and credit of the United States are pledged for the payment of principal and interest.

 

(b) United States Agency Securities. Obligations issued or guaranteed by any agency, including government sponsored enterprises of the United States Government, which at the time of purchase have a liquid market and a readily determinable market value that are described as follows:

 

(i) U.S. Government Agency Coupon and Zero Coupon Securities. Bullet coupon bonds with no embedded options.

 

(ii) U.S. Government Agency Discount Notes. Purchased at a discount with maximum maturities of one (1) year.

 

(iii) U.S. Government Agency Callable Securities. Restricted to securities callable at par only with maximum final maturities of five (5) years.

 

(iv) U.S. Government Agency Step-Up Securities. The coupon rate is fixed for an initial term. At coupon date, the coupon rate rises to a new, higher fixed interest rate. Restricted to securities with maximum final maturities of three (3) years.

 

(v) U.S. Government Agency Floating Rate Securities. The coupon rate floats off of only one index. Restricted to coupons with no interim caps that reset at least quarterly.

 

(vi) U.S. Government Agency Mortgage Backed Securities (MBS, CMO, Pass-Thru Securities). Restricted to securities with final maturities of three (3) years or less or have the final projected payment no greater than three (3) years when analyzed in a +300 basis point interest rate environment. Restricted to obligations of FNMA, FHLMC and GNMA only.

 

(c) Repurchase Agreements. Contractual agreements between the City and commercial banks or primary government securities dealers, organized under the laws of the United States or any state, which contractual agreements are continuously and fully secured by any one or more of the securities described in paragraphs (a) and (b) above and which have a market value, exclusive of accrued interest, at all times at least equal to the principal amount of such repurchase agreements. Securities acquired pursuant to repurchase agreements shall be valued at the lower of the current market value or the repurchase price thereof set forth in the repurchase agreement. The Bond Market Associations guidelines for the Master Repurchase Agreement will be used and will govern all repurchase agreement transactions. All repurchase agreements shall result in transfer of legal title to identified securities that are segregated in a custodial or trust account for the benefit of the Trustee or delivered to the Trustee. Repurchase agreement transactions will be either physical delivery or tri-party.

 

(d) Bankers Acceptances. Bankers acceptances issued by domestic commercial banks possessing the highest rating issued by Moodys Investor Services, Inc. (Moodys) or Standard and Poors Ratings Group (Standard and Poors).

 

(e) Commercial Paper. Commercial paper issued by domestic corporations, which has received the highest rating issued by Moodys Investor Services, Inc. or Standard and Poors Corporation. Eligible paper is further limited to issuing corporations that have total assets in excess of five hundred million dollars ($500,000,000) and are not listed on Credit Watch with negative implications by any nationally recognized rating agency at the time of purchase.

(f) Any full faith and credit obligations of the State of Missouri rated at least A or A2 by Standard and Poors or Moodys.

 

(g) Any full faith and credit obligations of any county in which the City is located rated AA or Aa2 by Standard and Poors or Moodys.

 

(h) Any full faith and credit obligations of any school district in Kansas City, Missouri rated AA or Aa2 by Standard and Poors or Moodys.

 

(i) Any full faith and credit obligations or revenue bonds of the City of Kansas City, Missouri rated AA or Aa2 by Standard and Poors or Moodys.

 

(j) Any municipal obligation as defined in (f), (g), (h) or (i) that is not rated but either pre-refunded or escrowed to maturity with U.S. Treasury Securities as to both principal and interest.

 

(k) Money market mutual funds registered under the Federal Investment Company Act of 1940, whose shares are registered under the Federal Securities Act of 1933, rated in either of the two highest categories by Moodys and Standard & Poors (in either case without regard to any modifier).

 

(l) Such other investments not described above that are allowed pursuant to Missouri law.

 

References to particular ratings and rating categories in this definition are applicable only at the time of purchase of the Permitted Investment.

 

Person means any natural person, corporation, partnership, joint venture, association, firm, joint‑stock company, trust, unincorporated organization, or government or any agency or political subdivision thereof or other public body.

 

Project Fund means the Series 2007A Project Fund created in Section 501.

 

Purchase Contract means the Bond Purchase Agreement relating to the Bonds between the City and the Underwriter.

 

Purchaser means the manager of the underwriting group that originally purchases the Bonds.

 

Rebate Fund means the fund by that name referred to in Section 501.

 

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.

 

Redemption Date when used with respect to any Bond to be redeemed means the date fixed for such redemption pursuant to the terms of this Ordinance.

 

Redemption Price when used with respect to any Bond to be redeemed means the price at which such Bond is to be redeemed pursuant to the terms of this Ordinance, including the applicable redemption premium, if any, but excluding installments of interest whose Stated Maturity is on or before the Redemption Date.

 

Replacement Bonds means Bonds issued to the beneficial owners of the Bonds in accordance with Section 210(b).

 

Securities Depository means, initially, The Depository Trust Company, New York, New York, and its successors and assigns.

 

Series 1997B Refunded Bonds means the Citys Outstanding General Obligations Bonds (Streetlight Project) Series 1997B authorized by Ordinance No. 970873.

 

Series 2000A Refunded Bonds means $30,140,000 aggregate outstanding principal amount of the Citys General Obligation Bonds (Streetlight Project) Series 2000A with stated maturities of February 1, 2011 through 2017, authorized by Ordinance No. 000752.

 

Special Record Date means the date fixed by the Paying Agent pursuant to Section 204 hereof for the payment of Defaulted Interest.

 

Stated Maturity when used with respect to any Bond or any installment of interest thereon means the date specified in such Bond and this Ordinance as the fixed date on which the principal of such Bond or such installment of interest is due and payable.

 

Underwriter means collectively, Banc of America Securities LLC, as representative of the underwriters of the Bonds as defined in the Purchase Contract.

 

United States Government Obligations means bonds, notes, certificates of indebtedness, treasury bills or other securities constituting direct obligations of, or obligations the principal of and interest on which are fully and unconditionally guaranteed as to full and timely payment by the United States of America, including evidences of a direct ownership interest in future interest or principal payments on obligations issued or guaranteed by the United States of America (including the interest component of obligations of the Resolution Funding Corporation).

 

World War I Museum Project means, without limitation, the construction, acquisition, renovation, equipping and furnishing of the costs for the museum, exhibits, library and educational facilities of the World War I Museum Project at Liberty Memorial.

 

Zoo Project means, without limitation, the construction, acquisition, renovation, equipping and furnishing of the costs of basic capital infrastructure and improvements for the Kansas City Zoological Garden.

 

ARTICLE II

 

AUTHORIZATION OF BONDS

 

Section 201. Authorization of Bonds. There shall be issued and hereby are authorized and directed to be issued the General Obligation Improvement and Refunding Bonds, Series 2007A, of the City in the principal amount not to exceed $145,000,000 (the Bonds), for the purpose of paying (a) a portion of the costs of the World War I Museum Project, (b) a portion of the costs of the Zoo Project, (c) a portion of the costs of the Basic Infrastructure Project, (d) the costs of currently refunding the Series 1997B Refunded Bonds, (e) the costs of advance refunding the Series 2000A Refunded Bonds and (f) the costs of issuing the Bonds.

 

Section 202. Description of Bonds. The Bonds shall consist of fully registered bonds without coupons, numbered from R-1 upward in denominations of $5,000 or any integral multiple thereof. The Bonds shall be substantially in the form set forth in Section 202A hereto, and shall be subject to registration, transfer and exchange as provided in Section 205. The Bonds shall be dated the date of their issuance, shall become due in the amounts on the Stated Maturities set forth therein, subject to redemption and payment prior to their Stated Maturities as provided in Article III, and shall bear interest at the rates per annum to be determined upon the sale of the Bonds as set forth in the Certificate of Final Terms.

 

At the election of the Purchaser, term Bonds may be issued in lieu of all or a portion of serial Bonds with Stated Maturities with mandatory sinking fund redemption payments and final payments at maturity in the amounts set forth, subject to the following conditions: all Bonds selected as a term Bond shall bear the same rate of interest; and not less than all Bonds of the same Stated Maturity shall be converted to a term Bond with mandatory redemption requirements.

 

The Bonds shall bear interest (computed on the basis of a 360‑day year of twelve 30‑day months) from the dated date thereof or from the most recent Interest Payment Date to which interest has been paid or duly provided for, payable semiannually on February 1 and August 1 in each year, beginning on August 1, 2007.

 

Section 202A. Form of Bond The Bonds will be in substantially the following form, with appropriate insertions and deletions as are approved by the Mayor, which approval will be conclusively evidenced by the Mayors signature on the Bond:

 

FORM OF BOND

 

EXCEPT AS OTHERWISE PROVIDED IN THE ORDINANCE (DESCRIBED HEREIN), THIS GLOBAL BOND MAY BE TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES DEPOSITORY (DESCRIBED HEREIN) OR TO A SUCCESSOR SECURITIES DEPOSITORY OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY.

 

UNITED STATES OF AMERICA

STATE OF MISSOURI

Registered Registered

No. ______ $_______

 

CITY OF KANSAS CITY, MISSOURI

 

GENERAL OBLIGATION IMPROVEMENT AND REFUNDING BOND

SERIES 2007A

 

Interest Rate Maturity Date Dated Date CUSIP Number

 

20___ April __, 2007

 

REGISTERED OWNER: CEDE & CO.

 

PRINCIPAL AMOUNT: DOLLARS

 

THE CITY OF KANSAS CITY, MISSOURI, for value received, hereby acknowledges itself to be indebted and promises to pay to the Registered Owner shown above, or registered assigns, the Principal Amount shown above on the Maturity Date shown above, unless called for redemption prior to said Maturity Date, and to pay interest thereon at the Interest Rate per annum shown above (computed on the basis of a 360‑day year of twelve 30‑day months) from the Dated Date shown above or from the most recent Interest Payment Date to which interest has been paid or duly provided for, payable semiannually on February 1 and August 1 in each year, beginning on August 1, 2007, until said Principal Amount has been paid.

 

The Principal Amount or Redemption Price of this Bond shall be paid at Maturity or upon earlier redemption by check or draft to the Person in whose name this Bond is registered at the Maturity or Redemption Date thereof, upon presentation and surrender of this Bond at the payment office of First Bank of Missouri, in Gladstone, Missouri (the Paying Agent). The interest payable on this Bond on any Interest Payment Date shall be paid to the Person in whose name this Bond is registered on the Bond Register maintained by the Paying Agent at the close of business on the Record Date for such interest by check or draft mailed by the Paying Agent to the address of such Registered Owner shown on the Bond Register or, in the case of an interest payment to any Registered Owner of $500,000 or more in aggregate principal amount of Bonds, by electronic transfer to such Registered Owner upon written notice given to the Paying Agent by such Owner not less than 15 days prior to the Record Date for such interest, containing the electronic transfer instructions including the bank (which shall be in the continental United States), ABA routing number and account number to which such Registered Owner wishes to have such transfer directed.

 

This Bond is one of an authorized series of bonds of the City designated General Obligation Improvement and Refunding Bonds, Series 2007A, aggregating the principal amount of $145,000,000 (the Bonds), issued by the City for the purpose of paying (a) a portion of the costs of the World War I Museum Project, (b) a portion of the costs of the Zoo Project, (c) a portion of the costs of the Basic Infrastructure Project, (d) the costs of currently refunding the Series 1997B Refunded Bonds, (e) the costs of advance refunding the Series 2000A Refunded Bonds and (f) the costs of issuing the Bonds, under the authority of and in full compliance with the Constitution and laws of the State of Missouri, and pursuant to elections duly held in the City and an Ordinance duly passed (the Ordinance) and proceedings duly and legally had by the Council of the City. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Ordinance.

 

At the option of the City, Bonds or portions thereof maturing on February 1, 20___, and thereafter may be called for redemption and payment prior to their Stated Maturity on February 1, 20___, and thereafter in whole or in part at any time in such amounts for each Stated Maturity as shall be determined by the City at a Redemption Price equal to 100% of the principal amount, plus accrued interest thereon to the Redemption Date.

 

[Bonds maturing on February 1, 20___, are subject to mandatory redemption and payment prior to maturity pursuant to the mandatory redemption requirements of the Ordinance on February 1, _____, and on each February 1 thereafter prior to maturity, at a redemption price equal to 100% of the Principal Amount thereof plus accrued interest to the Redemption Date.]

 

Notice of redemption, unless waived, is to be given by the Paying Agent by mailing an official redemption notice by first class mail at least 30 days prior to the Redemption Date to the State Auditor of Missouri, the original purchaser of the Bonds and to each Registered Owner of each of the Bonds to be redeemed at the address shown on the Bond Register maintained by the Paying Agent. Notice of redemption having been given as aforesaid, the Bonds or portions of Bonds to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and after such date (unless the City defaults in the payment of the Redemption Price) such Bonds or portions of Bonds shall cease to bear interest.

 

The Bonds are being issued by means of a book-entry system with no physical distribution of bond certificates to be made except as provided in the Ordinance. One Bond certificate with respect to each date on which the Bonds are stated to mature, registered in the nominee name of the Securities Depository, is being issued and required to be deposited with the Securities Depository and immobilized in its custody. The book-entry system will evidence positions held in the Bonds by the Securities Depositorys participants, beneficial ownership of the Bonds in authorized denominations being evidenced in the records of such participants. Transfers of ownership shall be effected on the records of the Securities Depository and its participants pursuant to rules and procedures established by the Securities Depository and its participants. The City, the Bond Registrar and the Paying Agent will recognize the Securities Depository nominee, while the registered owner of this Bond, as the owner of this Bond for all purposes, including (i) payments of principal of, and redemption premium, if any, and interest on, this Bond, (ii) notice, and (iii) voting. Transfers of principal, interest and any redemption premium payments to participants of the Securities Depository, and transfers of principal, interest and any redemption premium payments to beneficial owners of the bonds by participants of the Securities Depository will be the responsibility of such participants and other nominees of such beneficial owners. The City and the Paying Agent will not be responsible or liable for such transfers of payments or for maintaining, supervising or reviewing the records maintained by the Securities Depository, the Securities Depository nominee, its participants or persons acting through such participants. While the Securities Depository nominee is the owner of this bond, notwithstanding the provision hereinabove contained, payments of principal of and interest on this Bond shall be made in accordance with existing arrangements among the City, the Paying Agent and the Securities Depository.

 

The Bonds constitute 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, real and personal, within the territorial limits of the City. The full faith, credit and resources of the City are irrevocably pledged for the prompt payment of the principal of and interest on the Bonds as the same become due.

 

This Bond may be transferred or exchanged, as provided in the Ordinance, only on the Bond Register kept for that purpose at the principal payment office of the Paying Agent, upon surrender of this Bond together with a written instrument of transfer or authorization for exchange satisfactory to the Paying Agent duly executed by the Registered Owner or the Registered Owners duly authorized agent, and thereupon a new Bond or Bonds in any authorized denomination having the same Maturity Date and in the same aggregate principal amount shall be issued to the transferee in exchange therefor as provided in the Ordinance and upon payment of the charges therein prescribed. The City and the Paying Agent may deem and treat the person in whose name this Bond is registered on the Bond Register as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or Redemption Price hereof and interest due hereon and for all other purposes.

 

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 has been executed by the Paying Agent.

 

IT IS HEREBY CERTIFIED AND DECLARED that all acts, conditions and things required to exist, happen and be performed precedent to and in the issuance of the Bonds have existed, happened and been performed in due time, form and manner as required by law; that a direct annual tax upon all taxable tangible property situated in the City has been levied for the purpose of paying the principal of and interest on the Bonds when due; 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 CITY OF KANSAS CITY, MISSOURI, has caused this Bond to be executed by the manual or facsimile signature of its Mayor and attested by the manual or facsimile signature of its City Clerk and its official seal to be affixed or imprinted hereon.

 

CERTIFICATE OF AUTHTICATION CITY OF KANSAS CITY, MISSOUR

 

This Bond is one of the Bonds of the issue

described in the within-mentioned Ordinance.

By:_______________________________

Mayor

Registration Date:_______________________

(SEAL)

FIRST BANK OF MISSOURI

Paying Agent ATTEST:

 

By _______________________________ ____________________________________

Authorized Officer or Signatory City Clerk

 

STATEMENT OF INSURANCE

 

MBIA Insurance Corporation (the Insurer) has issued a policy containing the following provisions, such policy being on file at First Bank of Missouri, Gladstone, Missouri.

 

The Insurer, in consideration of the payment of the premium and subject to the terms of this policy, hereby unconditionally and irrevocably guarantees to any owner, as hereinafter defined, of the following described obligations, the full and complete payment required to be made by or on behalf of the City to First Bank of Missouri or its successor (the Paying Agent) of an amount equal to (i) the principal of (either at the stated maturity or by any advancement of maturity pursuant to a mandatory sinking fund payment) and interest on, the Obligations (as that term is defined below) as such payments shall become due but shall not be so paid (except that in the event of any acceleration of the due date of such principal by reason of mandatory or optional redemption or acceleration resulting from default or otherwise, other than any advancement of maturity pursuant to a mandatory sinking fund payment, the payments guaranteed hereby shall be made in such amounts and at such times as such payments of principal would have been due had there not been any such acceleration); and (ii) the reimbursement of any such payment which is subsequently recovered from any owner pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes an avoidable preference to such owner within the meaning of any applicable bankruptcy law. The amounts referred to in clauses (i) and (ii) of the preceding sentence shall be referred to herein collectively as the Insured Amounts. Obligations shall mean:

 

$145,000,000

CITY OF KANSAS CITY, MISSOURI

GENERAL OBLIGATION IMPROVEMENT AND REFUNDING BONDS

SERIES 2007A

 

Upon receipt of telephonic or telegraphic notice, such notice subsequently confirmed in writing by registered or certified mail, or upon receipt of written notice by registered or certified mail, by the Insurer from the Paying Agent or any owner of an Obligation the payment of an Insured Amount for which is then due, that such required payment has not been made, the Insurer on the due date of such payment or within one business day after receipt of notice of such nonpayment, whichever is later, will make a deposit of funds, in an account with U.S. Bank Trust National Association, in New York, New York, or its successor, sufficient for the payment of any such Insured Amounts which are then due. Upon presentment and surrender of such Obligations or presentment of such other proof of ownership of the Obligations, together with any appropriate instruments of assignment to evidence the assignment of the Insured Amounts due on the Obligations as are paid by the Insurer, and appropriate instruments to effect the appointment of the Insurer as agent for such owners of the Obligations in any legal proceeding related to payment of Insured Amounts on the Obligations, such instruments being in a form satisfactory to U.S. Bank Trust National Association, U.S. Bank Trust National Association shall disburse to such owners or the Paying Agent payment of the Insured Amounts due on such Obligations, less any amount held by the Paying Agent for the payment of such Insured Amounts and legally available therefor. This policy does not insure against loss of any prepayment premium which may at any time be payable with respect to any Obligation.

 

As used herein, the term owner shall mean the registered owner of any Obligation as indicated in the books maintained by the Paying Agent, the City, or any designee of the City for such purpose. The term owner shall not include the City or any party whose agreement with the Issuer constitutes the underlying security for the Obligations.

Any service of process on the Insurer may be made to the Insurer at its offices located at 113 King Street, Armonk, New York 10504 and such service of process shall be valid and binding.

 

This policy is non-cancellable for any reason. The premium on this policy is not refundable for any reason including the payment prior to maturity of the Obligations.

 

MBIA INSURANCE CORPORATION

 

 

ASSIGNMENT

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto

 

_______________________________________________________________________________

Print or Type Name, Address and Social Security Number

or other Taxpayer Identification Number of Transferee

 

the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints ________________________________ agent to transfer the within Bond on the Bond Register kept by the Paying Agent for the registration thereof, with full power of substitution in the premises.

 

Dated: _______________________ ____________________________________

NOTICE: The signature to this assignment must correspond with the name of the Registered Owner as it appears upon the face of the within Bond in every particular.

 

Signature Guaranteed By:

 

___________________________________

(Name of Eligible Guarantor Institution as defined by SEC Rule 17 Ad-15 (17 CFR 240.17 Ad-15))

 

By _________________________________

Title:

 

Section 203. Designation of Paying Agent. The City shall designate from time to time by a certificate of the Director of Finance a paying agent for the payment of principal of and interest on the Bonds and as bond registrar with respect to the registration, transfer and exchange of Bonds (the Paying Agent).

 

The City will at all times maintain a Paying Agent meeting the qualifications herein described for the performance of the duties hereunder. The City reserves the right to appoint a successor Paying Agent for any Paying Agent hereafter appointed by the Director of Finance by (1) filing with the Paying Agent then performing such function a certified copy of the proceedings giving notice of the termination of such Paying Agent and appointing a successor, and (2) causing notice of the appointment of the successor Paying Agent to be given by first class mail to each Bondowner. No resignation or removal of the Paying Agent shall become effective until a successor has been appointed and has accepted the duties of Paying Agent.

 

Every Paying Agent appointed hereunder shall at all times be (1) a commercial banking association or corporation or trust company located in the State of Missouri organized and in good standing and doing business under the laws of the United States of America or of the State of Missouri and subject to supervision or examination by federal or state regulatory authority and (2) shall have a reported capital (exclusive of borrowed capital) plus surplus of not less than $100,000,000 or, consideration may be given by the City to a bank not meeting this amount if the bank submits an acceptable form of guarantee for its financial obligations to the City. If such institution publishes reports of conditions at least annually pursuant to law or regulation, then for the purposes of this Section the capital and surplus of such institution shall be deemed to be its capital and surplus as set forth in its most recent report of condition so published.

 

The Paying Agent shall be paid fees and expenses for its services in connection therewith.

 

Section 204. Method and Place of Payment of Bonds. The principal of or Redemption Price and interest on the Bonds shall be payable in any coin or currency of the United States of America that, on the respective dates of payment thereof, is legal tender for the payment of public and private debts.

 

The principal of or Redemption Price of each Bond shall be paid at Maturity by check or draft to the Person in whose name such Bond is registered on the Bond Register at the Maturity thereof, upon presentation and surrender of such Bond at the principal payment office of the Paying Agent.

 

The interest payable on each Bond on any Interest Payment Date shall be paid to the Registered Owner of such Bond as shown on the Bond Register at the close of business on the Record Date for such interest by check or draft mailed by the Paying Agent to the address of such Registered Owner shown on the Bond Register or, in the case of an interest payment to any Registered Owner of $500,000 or more in aggregate principal amount of Bonds, by electronic transfer to such Registered Owner upon written notice given to the Paying Agent by such Registered Owner signed by such Registered Owner not less than 15 days prior to the Record Date for such interest, containing the electronic transfer instructions including the bank (which shall be in the continental United States), ABA routing number and account number to which such Registered Owner wishes to have such transfer directed.

 

Notwithstanding the foregoing provisions of this Section, any Defaulted Interest with respect to any Bond shall cease to be payable to the Registered Owner of such Bond on the relevant Record Date and shall be payable to the Registered Owner in whose name such Bond is registered at the close of business on the Special Record Date for the payment of such Defaulted Interest, which Special Record Date shall be fixed as hereinafter specified in this paragraph. The City shall notify the Paying Agent in writing of the amount of Defaulted Interest proposed to be paid on each Bond and the date of the proposed payment (which date shall be at least 30 days after receipt of such notice by the Paying Agent) and shall deposit with the Paying Agent at the time of such notice an amount of money equal to the aggregate amount proposed 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. Following receipt of such funds the Paying Agent shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 nor less than 10 days prior to the date of the proposed payment. The Paying Agent 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, by first class mail, postage prepaid, to each Registered Owner of a Bond entitled to such notice at the address of such Registered Owner as it appears on the Bond Register not less than 10 days prior to such Special Record Date.

 

The Paying Agent shall keep a record of payment of principal and Redemption Price of and interest on all Bonds and at least annually upon request shall forward a copy or summary of such records to the City.

 

Section 205. Registration, Transfer and Exchange of Bonds. The City covenants that, as long as any of the Bonds remain Outstanding, it will cause the Bond Register to be kept at the office of the Paying Agent as herein provided. Each Bond when issued shall be registered in the name of the owner thereof on the Bond Register.

 

Bonds may be transferred and exchanged only on the Bond Register as provided in this Section. Upon surrender of any Bond at the principal payment office of the Paying Agent, the Paying Agent shall transfer or exchange such Bond for a new Bond or Bonds in any authorized denomination of the same Stated Maturity and in the same aggregate principal amount as the Bond that was presented for transfer or exchange. Bonds presented for transfer or exchange shall be accompanied by a written instrument or instruments of transfer or authorization for exchange, in a form and with guarantee of signature satisfactory to the Paying Agent, duly executed by the Registered Owner thereof or by the Registered Owners duly authorized agent.

 

In all cases in which the privilege of transferring or exchanging Bonds is exercised, the Paying Agent shall authenticate and deliver Bonds in accordance with the provisions of this Ordinance. The City shall pay the fees and expenses of the Paying Agent for the registration, transfer and exchange of Bonds provided for by this Ordinance and the cost of printing a reasonable supply of registered bond blanks. Any additional costs or fees that might be incurred in the secondary market, other than fees of the Paying Agent, are the responsibility of the Registered Owners of the Bonds. In the event any Registered Owner fails to provide a correct taxpayer identification number to the Paying Agent, the Paying Agent may make a charge against such Registered Owner sufficient to pay any governmental charge required to be paid as a result of such failure. In compliance with Section 3406 of the Code, such amount may be deducted by the Paying Agent from amounts otherwise payable to such Registered Owner hereunder or under the Bonds.

 

The City and the Paying Agent shall not be required (a) to register the transfer or exchange of any Bond after notice calling such bond or portion thereof for redemption has been mailed by the Paying Agent pursuant to Section 303 and during the period of 15 days next preceding the date of mailing of such notice of redemption; or (b) to register the transfer or exchange of 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 Section 204.

 

The City and the Paying Agent may deem and treat the Person in whose name any Bond is registered on the Bond Register as the absolute owner of such Bond, whether such Bond is overdue or not, for the purpose of receiving payment of, or on account of, the principal or Redemption Price of and interest on said Bond and for all other purposes. All payments so made to any such Registered Owner or upon the Registered Owners order shall be valid and effective to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid, and neither the City nor the Paying Agent shall be affected by any notice to the contrary.

 

At reasonable times and under reasonable regulations established by the Paying Agent, the Bond Register may be inspected and copied by the Registered Owners of 10% or more in principal amount of the Bonds then Outstanding or any designated representative of such Registered Owners whose authority is evidenced to the satisfaction of the Paying Agent.

 

Section 206. Execution, Registration, Authentication and Delivery of Bonds. Each of the Bonds, including any Bonds issued in exchange or as substitutions for the Bonds initially delivered, shall be signed by the manual or facsimile signature of the Mayor and attested by the manual or facsimile signature of the City Clerk and shall have the official seal of the City affixed thereto or imprinted thereon. In case any officer whose signature appears on any Bond ceases to be such officer before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all purposes, as if such person had remained in office until delivery. Any Bond may be signed by such persons who at the actual time of the execution of such Bond are the proper officers to sign such Bond although at the date of such Bond such persons may not have been such officers.

 

The Mayor and the City Clerk are hereby authorized and directed to prepare and execute the Bonds in the manner herein specified and, when duly executed, to deliver the Bonds to the Paying Agent for authentication.

 

The Bonds shall have endorsed thereon a certificate of authentication substantially in the form set forth in the form of the Bond, which shall be manually executed by an authorized officer or employee of the Paying Agent, 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. No Bond shall be entitled to any security or benefit under this Ordinance or be valid or obligatory for any purpose unless and until such certificate of authentication has been duly executed by the Paying Agent. Such executed certificate of authentication upon any Bond shall be conclusive evidence that such Bond has been duly authenticated and delivered under this Ordinance. Upon authentication, the Paying Agent shall deliver the Bonds to the Purchaser upon payment of the purchase price for the Bonds to the City.

 

Section 207. Mutilated, Destroyed, Lost and Stolen Bonds. If (a) any mutilated Bond is surrendered to the Paying Agent or the Paying Agent receives evidence to its satisfaction of the destruction, loss or theft of any Bond, and (b) there is delivered to the City and the Paying Agent such security or indemnity as may be required by the Paying Agent, then, in the absence of notice to the City or the Paying Agent that such Bond has been acquired by a bona fide purchaser, the City shall execute and, upon the Citys request, the Paying Agent shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Bond, a new Bond of the same Stated Maturity and of like tenor and principal amount.

 

If any such mutilated, destroyed, lost or stolen Bond has become or is about to become due and payable, the City, in its discretion, may pay such Bond instead of issuing a new Bond.

 

Upon the issuance of any new Bond under this Section, the City and the Paying Agent may require the payment by the Registered Owner of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Paying Agent) connected therewith.

 

Every new Bond issued pursuant to this Section shall constitute a replacement of the prior obligation of the City, and shall be entitled to all the benefits of this Ordinance equally and ratably with all other Outstanding Bonds.

 

Section 208. Cancellation and Destruction of Bonds Upon Payment. All Bonds that have been paid or redeemed or that otherwise have been surrendered to the Paying Agent, either at or before Maturity, shall be cancelled by the Paying Agent immediately upon the payment, redemption and surrender thereof to the Paying Agent and subsequently destroyed in accordance with the customary practices of the Paying Agent and applicable retention laws.

 

Section 209. Preliminary and Final Official Statement. The use and public distribution of the Preliminary Official Statement dated the date thereof in connection with the public sale of the Bonds is hereby ratified and approved, and the final Official Statement is hereby authorized and approved by supplementing, amending and completing the Preliminary Official Statement, with such changes and additions thereto as are necessary to conform to and describe the transaction. The Director of Finance is hereby authorized to execute the final Official Statement as so supplemented, amended and completed, and the use and public distribution of the final Official Statement by the Purchaser in connection with the reoffering of the Bonds is hereby authorized. The proper officials of the City are hereby authorized to execute and deliver a certificate pertaining to such Official Statement as prescribed therein, dated as of the date of payment for and delivery of the Bonds.

 

For the purpose of enabling the Purchaser to comply with the requirements of Rule 15c2‑12(b)(1) of the Securities and Exchange Commission, the City hereby deems the information regarding the City contained in the Preliminary Official Statement to be final as of its date, except for the omission of such information as is permitted by Rule 15c2‑12(b)(1), and the appropriate officers of the City are hereby authorized, if requested, to provide the Purchaser a letter or certification to such effect and to take such other actions or execute such other documents as such officers in their reasonable judgment deem necessary to enable the Purchaser to comply with the requirement of such Rule.

 

The City agrees to provide to the Purchaser within seven business days of the date of the sale of Bonds sufficient copies of the final Official Statement to enable the Purchaser to comply with the requirements of Rule 15c2‑12(b)(4) of the Securities and Exchange Commission and with the requirements of Rule G‑32 of the Municipal Securities Rulemaking Board.

 

Section 210. Book-Entry Bonds; Securities Depository.

 

(a) The Bonds shall initially be registered to Cede & Co., the nominee for the Securities Depository, and no beneficial owner will receive certificates representing their respective interests in the Bonds, except in the event the Paying Agent issues Replacement Bonds as provided in subsection (b) hereof. It is anticipated that during the term of the Bonds, the Securities Depository will make book-entry transfers among its Participants and receive and transmit payment of principal of, premium, if any, and interest on, the Bonds to the Participants until and unless the Paying Agent authenticates and delivers Replacement Bonds to the beneficial owners as described in subsection (b).

 

(b) (1) If the City determines (A) that the Securities Depository is unable to properly discharge its responsibilities, or (B) that the Securities Depository is no longer qualified to act as a securities depository and registered clearing agency under the Securities and Exchange Act of 1934, as amended, or (2) if the Paying Agent receives written notice from Participants having interests in not less than 50% of the Bonds Outstanding, as shown on the records of the Securities Depository (and certified to such effect by the Securities Depository), that the continuation of a book-entry system to the exclusion of any Bonds being issued to any Owner other than Cede & Co. is no longer in the best interests of the beneficial owners of the Bonds, then the Paying Agent shall notify the Owners of such determination or such notice and of the availability of certificates to Owners requesting the same, and the Paying Agent shall register in the name of and authenticate and deliver Replacement Bonds to the beneficial owners or their nominees in principal amounts representing the interest of each, making such adjustments as it may find necessary or appropriate as to accrued interest and previous calls for redemption; provided, that in the case of a determination under (1)(A) or (1)(B) of this subsection (b), the City, with the consent of the Paying Agent, may select a successor securities depository in accordance with Section 210(c) hereof to effect book-entry transfers. In such event, all references to the Securities Depository herein shall relate to the period of time when the Securities Depository has possession of at least one Bond. Upon the issuance of Replacement Bonds, all references herein to obligations imposed upon or to be performed by the Securities Depository shall be deemed to be imposed upon and performed by the Paying Agent, to the extent applicable with respect to such Replacement Bonds. If the Securities Depository resigns and the City, the Paying Agent or Owners are unable to locate a qualified successor of the Securities Depository in accordance with Section 210(c) hereof, then the Paying Agent shall authenticate and cause delivery of Replacement Bonds to Owners, as provided herein. The Paying Agent may rely on information from the Securities Depository and its Participants as to the names of the beneficial owners of the Bonds. The cost of printing, registration, authentication and delivery of Replacement Bonds shall be paid for by the City.

 

(c) In the event the Securities Depository resigns, is unable to properly discharge its responsibilities, or is no longer qualified to act as a securities depository and registered clearing agency under the Securities and Exchange Act of 1934, as amended, the City may appoint a successor Securities Depository provided the Paying Agent and the City receive written evidence with respect to the ability of the successor Securities Depository to discharge its responsibilities. Any such successor Securities Depository shall be a securities depository which is a registered clearing agency under the Securities and Exchange Act of 1934, as amended, or other applicable statute or regulation that operates a securities depository upon reasonable and customary terms. The Paying Agent upon its receipt of a Bond or Bonds for cancellation shall cause the delivery of Bonds to the successor Securities Depository in appropriate denominations and form as provided herein.

 

Section 211. Sale and Terms of Bonds; Authorization and Execution of Bond Purchase Agreement and Certificate of Final Terms. The Bonds will be sold to the Underwriter under the terms of the Purchase Contract. The City may elect, at the time of the sale of the Bonds, for the Bond Insurance Policy to only cover certain selected maturities of the Bonds. The Mayor is authorized and directed to approve the purchase price for the Bonds, the principal amounts by maturity, the interest rates, the terms of credit enhancement and the other final terms of the Bonds, including applicable redemption provisions, subject to the limitations set forth in this Section and Exhibit A hereto, and in that connection, to execute and deliver the Certificate of Final Terms for and on behalf of and as the act and deed of the City, which approval will be conclusively evidenced by the Mayors execution of the Certificate of Final Terms. Upon execution, the Certificate of Final Terms will be attached to this Ordinance as Exhibit B, and the City Clerk is hereby authorized to file the Certificate of Final Terms with this Ordinance. The City is authorized to enter into the Purchase Contract in accordance with the Certificate of Final Terms. The Director of Finance is authorized to execute the Purchase Contract for and on behalf of and as the act and deed of the City.

 

ARTICLE III

 

REDEMPTION OF BONDS

 

Section 301. Optional and Mandatory Redemption of Bonds.

 

(a) Optional Redemption by City. At the option of the City, Bonds or portions thereof may be called for redemption and payment prior to their Stated in whole or in part at any time in such amounts for each Stated Maturity as shall be determined by the City at a Redemption Price equal to 100% of the principal amount, plus accrued interest thereon to the Redemption Date, as set forth in the Certificate of Final Terms.

 

(b) Mandatory Redemption. In the event Term Bonds are issued as provided in Section 202, such Bonds shall be subject to mandatory redemption and payment prior to their Stated Maturity pursuant to the mandatory redemption requirements of this Section on the dates of the Stated Maturities for serial Bonds at the principal amount thereof plus accrued interest to the Redemption Date, without premium. The taxes levied in Article IV which are to be deposited in the Debt Service Fund shall be sufficient to redeem any Bonds, and the City shall redeem on such dates the principal amounts set forth in Section 202 and the remaining principal amount of Bonds shall be paid at their Stated Maturity.

 

At its option, to be exercised on or before the 45th day next preceding any mandatory Redemption Date, the City may: (1) deliver to the Paying Agent for cancellation Term Bonds subject to mandatory redemption on said mandatory Redemption Date, in any aggregate principal amount desired; or (2) furnish the Paying Agent funds, together with appropriate instructions, for the purpose of purchasing any Term Bonds subject to mandatory redemption on said mandatory Redemption Date from any Registered Owner thereof whereupon the Paying Agent shall use its best efforts to expend such funds for such purpose to such extent as may be practical; or (3) receive a credit with respect to the mandatory redemption obligation of the City under this Section for any Term Bonds subject to mandatory redemption on said mandatory Redemption Date which, prior to such date, have been redeemed (other than through the operation of the mandatory redemption requirements of this subsection (b)) and cancelled by the Paying Agent and not theretofore applied as a credit against any redemption obligation under this subsection (b). Each Term Bond so delivered or previously purchased or redeemed shall be credited at 100% of the principal amount thereof on the obligation of the City to redeem Term Bonds of the same Stated Maturity on such mandatory Redemption Date, and any excess of such amount shall be credited on future mandatory redemption obligations for Term Bonds of the same Stated Maturity in chronological order, and the principal amount of Term Bonds of the same Stated Maturity to be redeemed by operation of the requirements of this Section shall be accordingly reduced. If the City intends to exercise any option granted by the provisions of clauses (1), (2) or (3) above, the City will, on or before the 45th day next preceding each mandatory Redemption Date, furnish the Paying Agent a written certificate indicating to what extent the provisions of said clauses (1), (2) and (3) are to be complied with respect to such mandatory redemption payment and in the event that clause (1) is to be complied with, such written certificate shall be accompanied by the Term Bonds to be cancelled.

 

Section 302. Selection of Bonds to be Redeemed.

 

(a) The Paying Agent shall call Bonds for redemption and payment and shall give notice of such redemption as herein provided upon receipt by the Paying Agent at least 45 days prior to the Redemption Date of written instructions from the City specifying the principal amount, Stated Maturities, Redemption Date and Redemption Prices of the Bonds to be called for redemption. If the Bonds are refunded more than 90 days in advance of such Redemption Date, any escrow agreement entered into by the City in connection with such refunding shall provide that such written instructions to the Paying Agent shall be given by the escrow agent on behalf of the City not more than 90 days prior to the Redemption Date. The Paying Agent may in its discretion waive such notice period so long as the notice requirements set forth in Section 303 are met. The foregoing provisions of this paragraph shall not apply to any mandatory redemption of Bonds hereunder, and Bonds shall be called by the Paying Agent for redemption pursuant to such mandatory redemption requirements without the necessity of any action by the City and whether or not the Paying Agent shall hold in the Debt Service Fund moneys available and sufficient to effect the required redemption.

 

(b) Bonds shall be redeemed only in the principal amount of $5,000 or any integral multiple thereof. Bonds of less than a full Stated Maturity shall be selected by the Paying Agent in $5,000 units of principal amount in such equitable manner as the Paying Agent may determine.

 

(c) In the case of a partial redemption of Bonds at the time outstanding in denominations greater than $5,000, then for all purposes in connection with such redemption each $5,000 of face value shall be treated as though it were a separate Bond of the denomination of $5,000. If it is determined that one or more, but not all, of the $5,000 units of face value represented by any Bond are selected for redemption, then upon notice of intention to redeem such $5,000 unit or units, the Registered Owner of such Bond or the Registered Owners duly authorized agent shall present and surrender such Bond to the Paying Agent (1) for payment of the Redemption Price and interest to the Redemption Date of such $5,000 unit or units of face value called for redemption, and (2) for exchange, without charge to the Registered Owner thereof, for a new Bond or Bonds of the aggregate principal amount of the unredeemed portion of the principal amount of such Bond. If the Registered Owner of any such Bond fails to present such Bond to the Paying Agent for payment and exchange as aforesaid, such Bond shall, nevertheless, become due and payable on the redemption date to the extent of the $5,000 unit or units of face value called for redemption (and to that extent only).

 

Section 303. Notice and Effect of Call for Redemption. Unless waived by any Registered Owner of Bonds to be redeemed, official notice of any redemption shall be given by the Paying Agent on behalf of the City by mailing a copy of an official redemption notice by first class mail at least 30 days prior to the Redemption Date to the State Auditor of Missouri, the Purchaser of the Bonds and each Registered Owner of the Bond or Bonds to be redeemed at the address shown on the Bond Register.

 

All official notices of redemption shall be dated and shall contain the following information:

 

(a) the Redemption Date;

 

(b) the Redemption Price;

 

(c) if less than all Outstanding Bonds of a maturity are to be redeemed, the identification (and, in the case of partial redemption of any Bonds, the respective principal amounts) of the Bonds to be redeemed;

 

(d) a statement that on the Redemption Date the Redemption Price will become due and payable upon each such Bond or portion thereof called for redemption and that interest thereon shall cease to accrue from and after the Redemption Date; and

 

(e) the place where such Bonds are to be surrendered for payment of the Redemption Price, which shall be the principal payment office of the Paying Agent.

 

The failure of any Registered Owner to receive notice given as heretofore provided or any defect therein shall not invalidate any redemption.

 

Prior to any Redemption Date, the City shall deposit with the Paying Agent an amount of money sufficient to pay the Redemption Price of all the Bonds or portions of Bonds that are to be redeemed on that date.

 

Official notice of redemption having been given as aforesaid, the Bonds or portions of Bonds to be redeemed shall become due and payable on the Redemption Date, at the Redemption Price therein specified, and from and after the Redemption Date (unless the City defaults in the payment of the Redemption Price) such Bonds or portion of Bonds shall cease to bear interest. Upon surrender of such Bonds for redemption in accordance with such notice, the Redemption Price of such Bonds shall be paid by the Paying Agent. Installments of interest due on or prior to the Redemption Date shall be payable as herein provided for payment of interest. Upon surrender for any partial redemption of any Bond, there shall be prepared for the Registered Owner a new Bond or Bonds of the same Stated Maturity in the amount of the unpaid principal as provided herein. All Bonds that have been surrendered for redemption shall be cancelled and destroyed by the Paying Agent as provided herein and shall not be reissued.

 

The Paying Agent is also directed to comply with any mandatory standards established by the Securities and Exchange Commission and then in effect for processing redemptions of municipal securities. Failure to comply with such standards shall not affect or invalidate the redemption of any Bond.

 

For so long as the Securities Depository is effecting book-entry transfers of the Bonds, the Paying Agent shall provide the notices specified in this Section to the Securities Depository. It is expected that the Securities Depository shall, in turn, notify its Participants and that the Participants, in turn, will notify or cause to be notified the beneficial owners. Any failure on the part of the Securities Depository or a Participant, or failure on the part of a nominee of a beneficial owner of a Bond (having been mailed notice from the Paying Agent, the Securities Depository, a Participant or otherwise) to notify the beneficial owner of the Bond so affected, shall not affect the validity of the redemption of such Bond.

 

ARTICLE IV

 

SECURITY FOR AND PAYMENT OF BONDS

 

Section 401. Security for the Bonds. 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, real and personal, within the territorial limits of the City. The full faith, credit and resources of the City are hereby irrevocably pledged for the prompt payment of the principal of and interest on the Bonds as the same become due.

 

Section 402. Levy and Collection of Annual Tax. For the purpose of providing for the payment of the principal of and interest on the Bonds as the same become due, there is hereby authorized to be levied upon all of the taxable tangible property within the City a direct annual tax sufficient to produce the amounts necessary for the payment of such principal and interest as the same becomes due and payable in each year.

 

The taxes referred to above shall, to the extent that other funds of the City are not available and earmarked for the purpose of paying the principal of and interest on the Bonds, be levied upon the tax rolls in each of the several years, respectively, and shall be levied and collected at the same time and in the same manner as the other ad valorem taxes of the City are levied and collected. The proceeds derived from said taxes shall be deposited in the Debt Service Fund, shall be kept separate and apart from all other funds of the City and shall be used solely for the payment of the principal of and interest on the Bonds as and when the same become due, taking into account any scheduled mandatory redemptions, and the fees and expenses of the Paying Agent.

 

If at any time said taxes are not collected in time to pay the principal of or interest on the Bonds when due, the Director of Finance is hereby authorized and directed to pay said principal or interest out of the general municipal revenue funds of the City and to reimburse said general municipal revenue funds for money so expended when said taxes are collected.

 

ARTICLE V

 

ESTABLISHMENT OF FUNDS;

DEPOSIT AND APPLICATION OF MONEYS

 

Section 501. Establishment of Funds. There have been or shall be established in the treasury of the City and shall be held and administered by the Director of Finance of the City the following separate funds:

 

(a) Series 2007A Project Fund (the Project Fund), and within the Project Fund, three separate accounts known as the Museum Account, the Zoo Account and the Basic Infrastructure Account, and within the Basic Infrastructure Account, a separate subaccount known as the Starlight/KC Museum Subaccount.

 

(b) Series 2007A Debt Service Fund (the Debt Service Fund).

 

(c) Rebate Fund.

 

(d) Costs of Issuance Fund.

 

In addition to the funds and accounts described above, the Escrow Agreement established an escrow account to be held and administered by the Escrow Agent in accordance therewith. The investment and use of moneys in the escrow account shall be governed by the Escrow Agreement.

 

Section 502. Deposit of Bond Proceeds. After payment of the premium for the Bond Insurance Policy, the net proceeds received from the sale of the Bonds shall be deposited simultaneously with the delivery of the Bonds as follows:

 

(a) All accrued interest received from the sale of the Bonds shall be deposited in the Debt Service Fund and applied in accordance with Section 504.

 

(b) The sum of $5,000.00 of the proceeds of the Bonds shall be deposited in the Rebate Fund.

 

(c)                An amount, including premium received from the sale of the Bonds, not to exceed $385,000.00 shall be deposited in the Costs of Issuance Fund to pay the costs of issuing the Bonds as authorized by the Director of Finance.

 

(d)               Proceeds of the Bonds in an amount sufficient for the payment of the principal of and interest on and the redemption premium on the Series 1997B Refunded Bonds, as set forth in the Certificate of Final Terms, shall be transferred to the paying agent for the Series 1997B Refunded Bonds and shall be used to pay and redeem the Series 1997B Refunded Bonds on April 19, 2007.

 

(e) Proceeds of the Bonds in an amount, which together with the earnings to accrue thereon, will be sufficient for the payment of the principal of and interest on and the redemption premium on the Series 2000A Refunded Bonds, as set forth in the Certificate of Final Terms, shall be deposited in the escrow account as established pursuant to the Escrow Agreement and shall be applied as provided therein.

 

(f) The remaining proceeds of the Bonds, including any premium received from the sale of the Bonds and not deposited in the Costs of Issuance Fund, not to exceed $80,00,000.00 shall be deposited in the various accounts and subaccounts of the Project Fund as set forth in the Certificate of Final Terms.

 

Amounts remaining in the Costs of Issuance Fund on July 15, 2007, shall be transferred pro rata to the Museum Account, the Zoo Account and the Starlight/KC Museum Subaccount. With regard to each of the World War I Museum Project, the Zoo Project and the Kansas City Museum and Starlight Theater components of the Basic Infrastructure Project, costs and expenses of issuing such proportionate amounts of Bonds paid from bond proceeds deposited in the Museum Account, the Zoo Account and the Starlight/KC Museum Subaccount, respectively, shall not exceed 2% of the proportionate principal amount of such Bonds allocable to each of the World War I Museum Project, the Zoo Project and the Kansas City Museum and Starlight Theater components of the Basic Infrastructure Project, respectively, since the portion of the proceeds of the Bonds allocable to the World War I Museum Project, the Zoo Project and the Kansas City Museum and Starlight Theater components of the Basic Infrastructure Project are considered to be private activity bonds with the meaning of Internal Revenue Code Sections 141 and 145 and therefore are subject to the 2% costs of issuance limitation contained in Internal Revenue Code Section 147(g).

 

Section 503. Application of Moneys in the Project Fund. Moneys in the Project Fund shall be used by the City solely and for the purpose of paying (a) a portion of the costs of the World War I Museum Project, (b) a portion of the costs of the Zoo Project, (c) a portion of the costs of the Basic Infrastructure Project and (d) the costs of issuing the Bonds, as applicable, for which the Bonds have been voted and authorized, as hereinbefore provided.

 

Upon completion of the purpose for which the Bonds have been issued, as applicable, any surplus remaining in any subaccount of the Project Fund, respectively, shall be transferred to and deposited in the Debt Service Fund and applied to the next installment of principal and/or interest due on the Bonds.

 

Section 504. Application of Moneys in Debt Service Fund. All amounts paid and credited to the Debt Service Fund shall be expended and used by the City for the sole purpose of paying the principal or Redemption Price of and interest on the Bonds as and when the same become due and the usual and customary fees and expenses of the Paying Agent. The Director of Finance is authorized and directed to withdraw from the Debt Service Fund sums sufficient to pay both principal or Redemption Price of and interest on the Bonds and the fees and expenses of the Paying Agent as and when the same become due, and to forward such sums to the Paying Agent in a manner which ensures that the Paying Agent will receive immediately available funds in such amounts on or before the business day immediately preceding the dates when such principal, interest and fees of the Paying Agent will become due. If, through the lapse of time or otherwise, the Registered Owners of Bonds are no longer entitled to enforce payment of the Bonds or the interest thereon, the Paying Agent shall return said funds to the City. All moneys deposited with the Paying Agent shall be deemed to be deposited in accordance with and subject to all of the provisions contained in this Ordinance and shall be held in trust by the Paying Agent for the benefit of the Registered Owners of the Bonds entitled to payment from such moneys.

 

Any moneys or investments remaining in the Debt Service Fund after the retirement of the indebtedness for which the Bonds were issued and all other indebtedness of the City shall be transferred and paid into the general fund of the City.

 

Section 505. Deposits and Investment of Moneys. Moneys in each of the funds created by and referred to in this Ordinance shall be deposited in a bank or banks or other legally permitted financial institutions located in the State of Missouri that are members of the Federal Deposit Insurance Corporation. All such deposits shall be continuously and adequately secured by the banks or financial institutions holding such deposits as provided by the laws of the State of Missouri. All moneys held in the funds created by this Ordinance shall be kept separate and apart from all other funds of the City so that there shall be no commingling of such funds with any other funds of the City.

 

Moneys held in any fund referred to in this Ordinance may be invested in accordance with this Ordinance and the Arbitrage Instructions in Permitted Investments; provided, however, that no such investment shall be made for a period extending longer than to the date when the moneys invested may be needed for the purpose for which such fund was created. The interest earnings and any profit realized from Permitted Investments in any fund or account hereunder shall be credited to the Debt Service Fund and any loss resulting from Permitted Investments in any fund or account shall be charged to such fund or account.

 

Section 506. Nonpresentment of Bonds. If any Bond is not presented for payment when the principal thereof becomes due at Maturity, if funds sufficient to pay such Bond have been made available to the Paying Agent all liability of the City to the Registered Owner thereof for the payment of such Bond shall forthwith cease, determine and be completely discharged, and thereupon it shall be the duty of the Paying Agent to hold such funds, without liability for interest thereon, for the benefit of the Registered Owner of such Bond, who shall thereafter be restricted exclusively to such funds for any claim of whatever nature on his part under this Ordinance or on, or with respect to, said Bond. If any Bond is not presented for payment within four years following the date when such Bond becomes due at Maturity, the Paying Agent shall repay to the City the funds theretofore held by it for payment of such Bond, and such Bond shall, subject to the defense of any applicable statute of limitation, thereafter be an unsecured obligation of the City, and the Registered Owner thereof shall be entitled to look only to the City for payment, and then only to the extent of the amount so repaid to it by the Paying Agent, and the City shall not be liable for any interest thereon and shall not be regarded as a trustee of such money.

 

Section 507. Application of Moneys in the Rebate Fund.

 

(a) There shall be deposited in the Rebate Fund (1) the amount required by Section 502(b) hereof and (2) such amounts as are required to be deposited therein pursuant to the Arbitrage Instructions. Subject to the payment provisions provided in subsection (b) and (d) below, all money in the Rebate Fund shall be held in trust, to the extent required to satisfy the Rebate Amount (as defined in the Arbitrage Instructions), for payment to the United States of America, and neither the City nor the Registered Owner of any Bond shall have any rights in or claim to such money. All amounts deposited into or on deposit in the Rebate Fund shall be governed by this Section and the Arbitrage Instructions.

 

(b) The City shall periodically determine the rebatable arbitrage under Section 148(f) of the Code in accordance with the Arbitrage Instructions, and the City shall make payments to the United States of America at the times and in the amounts determined under the Arbitrage Instructions. Any moneys remaining in the Rebate Fund after redemption and payment of all of the Bonds and the interest thereon and payment and satisfaction of any Rebate Amount, or provision made therefor, shall be released to the City.

 

(c) Notwithstanding any other provision of this Ordinance, including in particular Article VII, the obligation to pay rebatable arbitrage to the United States and to comply with all other requirements of this Section and the Arbitrage Instructions shall survive the defeasance or payment in full of the Bonds.

 

(d) The moneys deposited in the Rebate Fund pursuant to Section 502(b) hereof shall be used by the City to pay the fees and expenses of the Rebate Analyst (as defined in the Arbitrage Certificate). In the event that the City receives an opinion of Bond Counsel to the effect that further computations of rebate are not required under the Code, any unexpended portion of the moneys deposited in the Rebate Fund pursuant to Section 502(b) hereof shall be transferred to the Debt Service Fund.

 

ARTICLE VI

 

REMEDIES

 

Section 601. Remedies. The provisions of this Ordinance, including the covenants and agreements herein contained, shall constitute a contract between the City and the Registered Owners of the Bonds, and the Registered Owner or Owners of not less than 10% in principal amount of the Bonds at the time Outstanding shall have the right for the equal benefit and protection of all Registered Owners of Bonds similarly situated:

 

(a) by mandamus or other suit, action or proceedings at law or in equity to enforce the rights of such Registered Owner or Owners against the City and its officers, agents and employees, and to require and compel duties and obligations required by the provisions of this Ordinance excluding Section 906 or by the constitution and laws of the State of Missouri;

 

(b) by suit, action or other proceedings in equity or at law to require the City, its officers, agents and employees to account as if they were the trustees of an express trust; and

 

(c) by suit, action or other proceedings in equity or at law to enjoin any acts or things which may be unlawful or in violation of the rights of the Registered Owners of the Bonds.

 

Section 602. Limitation on Rights of Bondowners. The covenants and agreements of the City contained herein and in the Bonds shall be for the equal benefit, protection and security of the legal owners of any or all of the Bonds. All of the Bonds shall be of equal rank and without preference or priority of one Bond over any other Bond in the application of the funds herein pledged to the payment of the principal of and the interest on the Bonds, or otherwise, except as to rate of interest, or date of Maturity or right of prior redemption as provided in this Ordinance. No one or more Bondowners secured hereby shall have any right in any manner whatever by his or their action to affect, disturb or prejudice the security granted and provided for herein, or to enforce any right hereunder, except in the manner herein provided, and all proceedings at law or in equity shall be instituted, had and maintained for the equal benefit of all Registered Owners of such Outstanding Bonds.

 

Section 603. Remedies Cumulative. No remedy conferred herein upon the Bondowners is intended to be exclusive of any other remedy, but each such remedy shall be cumulative and in addition to every other remedy and may be exercised without exhausting and without regard to any other remedy conferred herein. No waiver of any default or breach of duty or contract by the Registered Owner of any Bond shall extend to or affect any subsequent default or breach of duty or contract or shall impair any rights or remedies consequent thereon. No delay or omission of any Bondowner to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein. Every substantive right and every remedy conferred upon the Registered Owners of the Bonds by this Ordinance may be enforced and exercised from time to time and as often as may be deemed expedient. If any suit, action or proceedings taken by any Bondowner on account of any default or to enforce any right or exercise any remedy has been discontinued or abandoned for any reason, or has been determined adversely to such Bondowner, then, and in every such case, the City and the Registered Owners of the Bonds shall be restored to their former positions and rights hereunder, respectively, and all rights, remedies, powers and duties of the Bondowners shall continue as if no such suit, action or other proceedings had been brought or taken.

 

ARTICLE VII

 

DEFEASANCE

 

Section 701. Defeasance. When any or all of the Bonds or scheduled interest payments thereon have been paid and discharged, then the requirements contained in this Ordinance and the pledge of the Citys faith and credit hereunder and all other rights granted hereby shall terminate with respect to the Bonds or scheduled interest payments thereon so paid and discharged. Bonds or scheduled interest payments thereon shall be deemed to have been paid and discharged within the meaning of this Ordinance if there has been deposited with the Paying Agent, or other commercial bank or trust company located in the State of Missouri and having full trust powers, at or prior to the Stated Maturity or Redemption Date of said Bonds or the interest payments thereon, in trust for and irrevocably appropriated thereto, moneys and/or Defeasance Obligations which, together with the interest to be earned thereon, will be sufficient for the payment of the principal or Redemption Price of said Bonds and/or interest to accrue on such Bonds to the Stated Maturity or Redemption Date, or if default in such payment has occurred on such date, then to the date of the tender of such payments; provided, however, that if any such Bonds are to be redeemed prior to their Stated Maturity, (1) the City shall have elected to redeem such Bonds, and (2) either notice of such redemption shall have been given, or the City shall have given irrevocable instructions, or shall have provided for an escrow agent to give irrevocable instructions, to the Paying Agent to redeem such Bonds in compliance with Section 302(a) of this Ordinance. Any moneys and Defeasance Obligations that at any time shall be deposited with the Paying Agent or other commercial bank or trust company by or on behalf of the City, for the purpose of paying and discharging any of the Bonds or the interest payments thereon, shall be and are hereby assigned, transferred and set over to the Paying Agent or other bank or trust company in trust for the respective Registered Owners of such Bonds, and such moneys shall be and are hereby irrevocably appropriated to the payment and discharge thereof. All moneys and Defeasance Obligations deposited with the Paying Agent or other bank or trust company shall be deemed to be deposited in accordance with and subject to all of the provisions of this Ordinance.

 

ARTICLE VIII

 

BOND INSURANCE

 

Section 801. Payments Under Bond Insurance Policy. In the event that, on the second Business Day, and again on the Business Day, prior to the payment date on the Bonds, the Paying Agent has not received sufficient moneys to pay all principal of and interest on the Bonds due on the second following or following, as the case may be, Business Day, the Paying Agent shall immediately notify the Bond Insurer or its designee on the same Business Day by telephone or telegraph, confirmed in writing by registered or certified mail, of the amount of the deficiency.

 

If the deficiency is made up in whole or in part prior to or on the payment date, the Paying Agent shall so notify the Bond Insurer or its designee.

 

In addition, if the Paying Agent has notice that any Bondowner has been required to disgorge payments of principal or interest on the Bonds to a trustee in bankruptcy or creditors or others pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes an avoidable preference to such Bondowner within the meaning of any applicable bankruptcy laws, then the Paying Agent shall notify the Bond Insurer or its designee of such fact by telephone or telegraphic notice, confirmed in writing by registered or certified mail.

 

The Paying Agent is hereby irrevocably designated, appointed, directed and authorized to act as attorney-in-fact for Owners of the Bonds as follows:

 

If and to the extent there is a deficiency in amounts required to pay interest on the Bonds, the Paying Agent shall (a) execute and deliver to U.S. Bank Trust National Association, or its successors under the Bond Insurance Policy (the Insurance Paying Agent), in form satisfactory to the Insurance Paying Agent, an instrument appointing the Bond Insurer as agent for such Owners in any legal proceeding related to the payment of such interest and an assignment to the Bond Insurer of the claims for interest to which such deficiency relates and which are paid by the Bond Insurer, (b) receive as designee of the respective Owners (and not as Paying Agent) in accordance with the tenor of the Bond Insurance Policy payment from the Insurance Paying Agent with respect to the claims for interest so assigned, and (c) disburse the same to such respective Owners; and

 

If and to the extent of a deficiency in amounts required to pay principal of the Bonds, the Paying Agent shall (a) execute and deliver to the Insurance Paying Agent in form satisfactory to the Insurance Paying Agent an instrument appointing the Bond Insurer as agent for such Owner in any legal proceeding relating to the payment of such principal and an assignment to the Bond Insurer of any of the Bond surrendered to the Insurance Paying Agent of so much of the principal amount thereof as has not previously been paid or for which moneys are not held by the Paying Agent and available for such payment (but such assignment shall be delivered only if payment from the Insurance Paying Agent is received), (b) receive as designee of the respective Owners (and not as Paying Agent) in accordance with the tenor of the Bond Insurance Policy payment therefor from the Insurance Paying Agent, and (c) disburse the same to such Owners.

 

Payments with respect to claims for interest on and principal of Bonds disbursed by the Paying Agent from proceeds of the Bond Insurance Policy shall not be considered to discharge the obligation of the City with respect to such Bonds, and the Bond Insurer shall become the owner of such unpaid Bond and claims for the interest in accordance with the tenor of the assignment made to it under the provisions of this section or otherwise.

 

Irrespective of whether any such assignment is executed and delivered, the City and the Paying Agent hereby agree for the benefit of the Bond Insurer that:

 

They recognize that to the extent the Bond Insurer makes payments, directly or indirectly (as by paying through the Paying Agent), on account of principal of or interest on the Bonds, the Bond Insurer will be subrogated to the rights of such Owners to receive the amount of such principal and interest from the City, with interest thereon as provided and solely from the sources stated in this Ordinance and the Bonds; and

 

They will accordingly pay to the Bond Insurer the amount of such principal and interest (including principal and interest recovered under subparagraph (ii) of the first paragraph of the Bond Insurance Policy, which principal and interest shall be deemed past due and not to have been paid), with interest thereon as provided in this Ordinance and the Obligation, but only from the sources and in the manner provided herein for the payment of principal of and interest on the Bonds to Owners, and will otherwise treat the Bond Insurer as the owner of such rights to the amount of such principal and interest.

 

Section 802. Documents to be Delivered to the Bond Insurer. In connection with the issuance of additional Bonds, the City shall deliver to the Bond Insurer a copy of the disclosure document, if any, circulated with respect to such additional Bonds.

 

Copies of any amendments made to the documents executed in connection with the issuance of the Bonds which are consented to by the Bond Insurer shall be sent to Standard & Poors Corporation.

 

The Insurer shall receive notice of the resignation or removal of the Paying Agent and the appointment of a successor thereto.

 

The Insurer shall receive copies of all notices required to be delivered to Bondowners and, on an annual basis, copies of the Citys audited financial statements and annual budget.

 

Any notice that is required to be given to a holder of the Bond or to the Paying Agent pursuant to this Ordinance shall also be provided to the Bond Insurer. All notices required to be given to the Bond Insurer under this Ordinance shall be in writing and shall be sent by registered or certified mail addressed to MBIA Insurance Corporation, 113 King Street, Armonk, New York 10504 Attention: Surveillance.

 

Section 803. Reimbursement of the Bond Insurer. The City agrees to reimburse the Bond Insurer immediately and unconditionally upon demand, to the extent permitted by law, for all reasonable expenses, including attorneys fees and expenses, incurred by the Bond Insurer in connection with (i) the enforcement by the Bond Insurer of the Citys obligations, or the preservation or defense of any rights of the Bond Insurer, under this Ordinance and any other document executed in connection with the issuance of the Bonds, and (ii) any consent, amendment, waiver or other action with respect to the Ordinance or any related document, whether or not granted or approved, together with interest on all such expenses from and including the date incurred to the date of payment at Citibanks Prime Rate plus 3% or the maximum interest rate permitted by law, whichever is less. In addition, the Bond Insurer reserves the right to charge a fee in connection with its review of any such consent, amendment or waiver, whether or not granted or approved .

 

Section 804. Consent of the Bond Insurer. The City agrees not to use the Bond Insurers name in any public document including, without limitation, a press release or presentation, announcement or forum without the Bond Insurers prior consent; provided however, such prohibition on the use of the Bond Insurers name shall not relate to the use of the Bond Insurers standard approved form of disclosure in public documents issued in connection with the current Bonds to be issued in accordance with the terms of the Commitment; and provided further such prohibition shall not apply to the use of the Bond Insurers name in order to comply with public notice, public meeting or public reporting requirements.

 

The City shall not enter into any agreement nor shall it consent to or participate in any arrangement pursuant to which Bonds are tendered or purchased for any purpose (other than the redemption and cancellation or legal defeasance of such Bonds without the prior written consent of MBIA).

 

ARTICLE IX

 

MISCELLANEOUS PROVISIONS

 

Section 901. Tax Covenants.

 

(a) The City covenants and agrees that (1) it will comply with all applicable provisions of the Code, including Sections 103 and 141 through 150, necessary to maintain the exclusion from federal gross income of the interest on the Bonds and (2) it will not use or permit the use of any proceeds of Bonds or any other funds of the City, nor take or permit any other action, or fail to take any action, if any such action or failure to take action would adversely affect the exclusion from federal gross income of the interest on the Bonds. The City will also pass 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 law 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 City.

 

(b) The City covenants and agrees that (1) it will use the proceeds of the Bonds as soon as practicable for the purposes for which the Bonds are issued, and (2) 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 that it will pay or provide for the payment from time to time of all rebatable arbitrage to the United States pursuant to Section 148(f) of the Code and the Arbitrage Instructions. This covenant shall survive payment in full or defeasance of the Bonds. The Arbitrage Instructions may be amended or replaced if, in the opinion of Bond Counsel, such amendment or replacement will not adversely affect the exclusion from federal gross income of interest on the Bonds.

 

(d) The City covenants that it will not use any portion of the proceeds of the Bonds, including any investment income earned on such proceeds, directly or indirectly, in a manner that would cause any Bond to be a private activity bond within the meaning of Section 141 of the Code.

 

(e) The foregoing covenants shall remain in full force and effect notwithstanding the defeasance of the Bonds pursuant to Article VII or any other provision of this Ordinance, until the final Maturity of all Bonds Outstanding.

 

Section 902. Annual Audit. In accordance with the provisions of Section 836, Article VIII, of the Citys Charter, the Council will provide that an independent certified audit of the Citys books and records will be made annually by certified public accountants, experienced and qualified in municipal and governmental accounting. Each such audit shall be detailed in scope and said accountants shall certify as to the correctness of the schedules contained in the audit report. All such schedules shall be incorporated in the annual financial report relating to the Citys finances, required by Section 838, Article VIII, of the Citys Charter. A copy of each such annual report will be filed with the City Clerk and will be open for public inspection.

 

Section 903. Amendments. The rights and duties of the City and the Bondowners, and the terms and provisions of the Bonds or of this Ordinance, may be amended or modified at any time in any respect by Ordinance of the City with the written consent of the Registered Owners of not less than a majority in principal amount of the Bonds then Outstanding, such consent to be evidenced by an instrument or instruments executed by such Registered Owners and duly acknowledged or proved in the manner of a deed to be recorded, and such instrument or instruments shall be filed with the City Clerk, but no such modification or alteration shall:

 

(a) extend the maturity of any payment of principal or interest due upon any Bond;

 

(b) effect a reduction in the amount which the City is required to pay as principal of or interest on any Bond;

 

(c) permit preference or priority of any Bond over any other Bond; or

 

(d) reduce the percentage in principal amount of Bonds required for the written consent to any modification or alteration of the provisions of this Ordinance.

 

Any provision of the Bonds or of this Ordinance may, however, be amended or modified by Ordinance duly adopted by the governing body of the City at any time in any legal respect with the written consent of the Registered Owners of all of the Bonds at the time Outstanding.

 

Without notice to or the consent of any Bondowners, the City may amend or supplement this Ordinance for the purpose of curing any formal defect, omission, inconsistency or ambiguity therein or in connection with any other change therein which is not materially adverse to the interests of the Bondowners.

 

Every amendment or modification of the provisions of the Bonds or of this Ordinance, to which the written consent of the Bondowners is given, as above provided, shall be expressed in an ordinance adopted by the governing body of the City amending or supplementing the provisions of this Ordinance and shall be deemed to be a part of this Ordinance. A certified copy of every such amendatory or supplemental Ordinance, if any, and a certified copy of this Ordinance shall always be kept on file in the office of the City Clerk, and shall be made available for inspection by the Registered Owner of any Bond or a prospective purchaser or owner of any Bond authorized by this Ordinance, and upon payment of the reasonable cost of preparing the same, a certified copy of any such amendatory or supplemental Ordinance or of this Ordinance will be sent by the City Clerk to any such Bondowner or prospective Bondowner.

 

Any and all modifications made in the manner hereinabove provided shall not become effective until there has been filed with the City Clerk a copy of the Ordinance of the City hereinabove provided for, duly certified, as well as proof of any required consent to such modification by the Registered Owners of the Bonds then Outstanding. It shall not be necessary to note on any of the Outstanding Bonds any reference to such amendment or modification.

 

The City shall furnish to the Paying Agent a copy of any amendment to the Bonds or this Ordinance which affects the duties or obligations of the Paying Agent under this Ordinance.

 

Section 904. Notices, Consents and Other Instruments by Bondowners. Any notice, consent, request, direction, approval or other instrument to be signed and executed by the Bondowners may be in any number of concurrent writings of similar tenor and may be signed or executed by such Bondowners in person or by agent appointed in writing. Proof of the execution of any such instrument or of the writing appointing any such agent and of the ownership of Bonds, other than the assignment of ownership of a Bond, if made in the following manner, shall be sufficient for any of the purposes of this Ordinance, and shall be conclusive in favor of the City and the Paying Agent with regard to any action taken, suffered or omitted under any such instrument, namely:

 

(a) The fact and date of the execution by any person of any such instrument may be proved by a certificate of any officer in any jurisdiction who by law has power to take acknowledgments within such jurisdiction that the person signing such instrument acknowledged before such officer the execution thereof, or by affidavit of any witness to such execution.

 

(b) The fact of ownership of Bonds, the amount or amounts, numbers and other identification of Bonds, and the date of holding the same shall be proved by the Bond Register.

 

In determining whether the Registered Owners of the requisite principal amount of Bonds Outstanding have given any request, demand, authorization, direction, notice, consent or waiver under this Ordinance, Bonds owned by the City shall be disregarded and deemed not to be Outstanding under this Ordinance, except that, in determining whether the Bondowners shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Bonds which the Bondowners know to be so owned shall be so disregarded. Notwithstanding the foregoing, Bonds so owned which have been pledged in good faith shall not be disregarded as aforesaid if the pledgee establishes to the satisfaction of the Bondowners the pledgees right so to act with respect to such Bonds and that the pledgee is not the City.

 

Section 905. Further Authority. The officers of the City, including the Mayor and City Clerk, are hereby authorized and directed to execute all documents and take such actions as they may deem necessary or advisable in order to carry out and perform the purposes of this Ordinance and to make ministerial alterations, changes or additions in the foregoing agreements, statements, instruments and other documents herein approved, authorized and confirmed which they may approve, and the execution or taking of such action shall be conclusive evidence of such necessity or advisability.

 

Section 906. Continuing Disclosure. The City covenants and agrees to enter into a Continuing Disclosure Agreement for the benefit of the Bondowners or similar undertaking intended to satisfy the ongoing disclosure requirements of Securities and Exchange Commission Rule 15c2‑12 and the Director of Finance is authorized to execute and deliver the Continuing Disclosure Agreement.

 

Section 907. Severability. If any section or other part of this Ordinance, whether large or small, is for any reason held invalid, the invalidity thereof shall not affect the validity of the other provisions of this Ordinance.

 

Section 908. Approval of Contracts. The City hereby approves the selection (1) of Gilmore & Bell, P.C. and The Martinez Law Firm, LLC as co-bond counsel for the Bonds, (2) of First Southwest Company and Valdes & Moreno, Inc. as the Citys co-financial advisors and (3) of Banc of America Securities LLC, as representative of the underwriters, and approves and ratifies all contracts in connection with such selections.

 

Section 909. Electronic Storage. The City agrees that the transactions described herein may be conducted and related documents may be stored by electronic means.

 

Section 910. Governing Law. This Ordinance shall be governed exclusively by and construed in accordance with the applicable laws of the State of Missouri.

 

Section 911. Effective Date. This Ordinance is declared to be an emergency measure within the provisions of Section 503(a), Article V of the Charter and shall take effect immediately upon its passage.

 

_________________________________________________

 

Approved as to form and legality:

 

 

_________________________________________

Heather A. Brown

Assistant City Attorney

EXHIBIT A

 

TERMS OF BONDS

 

 

1. Purchase Price: Not less than 98% of the Principal Amount.

 

2. Weighted Average Maturity of the Bonds: Not less than 8 years nor more than 13 years.

 

3. True Interest Cost: Not to exceed 4.60%.

 

4. Underwriters Discount: Not to exceed $812,631,75.

 

5. Final Maturity: Not to exceed February 1, 2027.

 

6. Present value savings on the Series 1997B Bonds: Not less than $459,940.

 

7. Present value savings on the Series 2000A Bonds: Not less than $730,198.

 

 

EXHIBIT B

 

 

CERTIFICATE OF FINAL TERMS

EXHIBIT C

 

FORM OF CERTIFICATE OF FINAL TERMS

 

The undersigned Mayor of the City of Kansas City, Missouri (the City), in connection with the issuance of the Citys General Obligation Improvement and Refunding Bonds Series 2007A (the Bonds), certifies pursuant to Section 211 of Ordinance No. 07____:

 

1. Principal Amount . The Bonds are issued in the Principal Amount of $__________.

 

2. Maturity Schedule. The Bonds will mature on the dates and in the amounts and bear interest at the rates as follows:

 

Maturity Principal Interest

February 1 Amount Rate

 

Term Bond

 

3. Weighted Average Maturity of the Bonds: The weighted average maturity of the Bonds is _____ years, as shown on Schedule 1 to this Certificate.

 

4. True Interest Cost: The True Interest Cost of the Bonds is ______%, as shown on Schedule 2 to this Certificate.

 

5. Purchaser and Purchase Price. The purchase price of the Bonds is $_________________, (representing the principal amount of $_________________, plus the premium of $_____________________, less the underwriters discount of $____________, plus accrued interest in the amount of $____________), which purchase price is _____% of the Principal Amount.

 

6. Optional Redemption. At the option of the City, Bonds or portions thereof maturing on February 1, 20___, and thereafter may be called for redemption and payment prior to their Stated Maturity on February 1, 20___, and thereafter in whole or in part at any time in such amounts for each Stated Maturity as shall be determined by the City at a Redemption Price equal to 100% of the principal amount, plus accrued interest thereon to the Redemption Date.

 

7. Mandatory Sinking Fund Redemption. [**There are no Term Bonds subject to mandatory sinking fund redemption prior to maturity.**][**The Term Bonds identified in paragraph 2 are subject to mandatory sinking fund redemption pursuant to Section 301(b) of the Ordinance on the dates and in the amounts as follows:

 

 

 

 

 

**]

 

8. Deposit of Bond Proceeds. After payment of the premium for the Bond Insurance Policy, the net proceeds received from the sale of the Bonds shall be deposited simultaneously with the delivery of the Bonds as follows:

 

(a) All accrued interest of $____________ and premium of $__________________ received from the sale of the Bonds shall be deposited in the Debt Service Fund and applied in accordance with Section 504.

 

(b) The sum of $5,000.00 of the proceeds of the Bonds shall be deposited in the Rebate Fund.

 

(c) $______________ shall be deposited in the Costs of Issuance Fund to pay the costs of issuing the Bonds as authorized by the Director of Finance.

 

(d) The sum of $____________ of the proceeds of the Bonds shall be transferred to the paying agent for the Series 1997B Refunded Bonds and used to pay the principal of and interest on and the redemption premium on the Series 1997B Refunded Bonds on April 19, 2007.

 

(e) The sum of $_____________ of the proceeds of the Bonds shall be transferred to the Escrow Agent and deposited in the escrow account established pursuant to the Escrow Agreement and applied in accordance therewith, in connection with the Series 2000A Refunded Bonds.

 

(f) The sum of $_______________ of the proceeds of the Bonds shall be deposited in the Museum Account of the Project Fund.

 

(g) The sum of $_______________of the proceeds of the Bonds shall be deposited in the Zoo Account of the Project Fund.

 

(h) The sum of $__________________of the proceeds of the Bonds shall be deposited in the Basic Infrastructure Account of the Project Fund.

 

The terms set forth in this Certificate of Final Terms are within the limitations of Exhibit A to the Ordinance.

 

Delivered this ____ day of March, 2007.

 

CITY OF KANSAS CITY, MISSOURI

 

 

 

By:

Mayor

Schedule 1

 

 

 

Schedule 2