201
Special Meeting December 20, 1958
a loan not to exceed $350,000 will be negotiated to aid in the cost of constructing, furnishing and equipping the proposed Nebraska Center for Continuing Education to be financed in part by a grant from the W. K. Kellogg Foundation in the sum of $1,500,000 and in part by pledges already received by the University of Nebraska Foundation and reported this day by the Foundation to be in the sum of $1,011,880, towards the total share required to be raised by the University in the sum of $1,142,000.
Authorized to sign Trust Agreement
First National Bank of Lincoln, Trustee
It was moved by Regent Welsh, seconded by Regent Greenberg, motion put to vote and carried, directing the president and corporation secretary of the Board of Regents shall be authorized to sign in behalf of the Board, the following Trust Agreement with the First National Bank of Lincoln, Nebraska, for the issuance of revenue bonds in the sum of $350,000 for the purpose of aiding in the construction of the proposed Nebraska Center for Continuing Education.
TRUST AGREEMENT
THIS AGREEMENT, made and entered into this 20th day of December, 1958, by and between THE BOARD OF REGENTS of the University of Nebrska, hereinafter sometimes referred to as the "Board of Regents", Party of the First Part, and THE FIRST NATIONAL BANK OF LINCOLN, a national banking association with its office in Lincoln, Nebraska, hereinafter referred to as "Trustee", Party of the Second Part,
WITNESSETH: That
WHEREAS, the Board of Regents has determined it is desirable and necessary to conduct continuing education for both youth and adults under the Educational Extension Program and for that purpose it is necessary to construct, operate and maintain adequate facilities on the Campus of the University of Nebraska College of Agriculture in Lincoln, Nebraska, said facilities hereinafter referred to as The Center. Preliminary plans have been prepared by Selmer A. Solheim & Associates of Lincoln and Welton Becket & Associates of Los Angeles, California, and the estimated cost of the construction, together with the necessary furniture, fixtures and equpment therefor, is $2,665,000. The cost of constructing said building and furnishing and equipping the same is to be financed by a grant from W. K. Kellogg Foundation in the sum of $1,500,000, a pledge in the sum of not less than $815,000 from the University of Nebraska Foundation, and the balance by issuance of Revenue Bonds under the provisions of Sections 85-403 to 85-411, Reissue Revised Statutes of Nebraska, 1943, hereinafter referred to as Revenue Bonds, and
TRUST AGREEMENT
WHEREAS, it is necessary to provide for the handling and disbursement of the funds derived from the Revenue Bonds and to provide for the use of funds derived from the operation of The Center so as to insure the payment of the Revenue Bonds, both principal and interest, as the same mature,
NOW THEREFORE, in consideration of the premises and the covenants and agreements herein contained to be mutually kept and performed by the Parties hereto and of the purchase of said Revenue Bond by the holder thereof, it is agreed between the Parties as follows: I. The Board of Regents agrees to construct on the Campus of the University of Nebraska College of Agriculture in Lincoln a building to be known as The Center substantially as provided in the preliminary plans of the above named Architects dated September 17, 1958, said construction to commence in the Spring of 1959 and to be completed, ready for occupancy and use, within a reasonable time thereafter, and agrees to operate said Center to the best of its ability from the time it is completed until the Revenue Bonds are paid in full and to establish and maintain such schedule of rates, fees and charges for the use of the facilities afforded by The Center as required to provide funds to operate and maintain The Center and to pay the principal and interest on the Revenue Bonds as the same become due and to establish not
Continued
- 191 -
202
Special Meeting December 20, 1958
Trust Agreement
later than July 1, 1964, and maintain thereafter, a Bond Reserve Fund of not less than $27,500.00. In event the operating revenues are otherwise insufficient to pay the expense of operating and maintaining The Center, to pay the debt service requirements, and to create and maintain the Bond Reserve Fund as herein provided, the Board of Regents agrees to furnish heat, light, power and other similar utilities required for the use and operation of The Center without charging the same to the revenues received from the operation of The Center.
II
In order to raise funds for the construction, furnishings and equipping said Center the Board of Regents will execute and deliver to the Continental National Bank of Lincoln, Nebraska, its Revenue Bond in the principal amount of $350,000 which bond shall bear interest at the rate of three percent (3%) per annum from date until July 1, 1964, and six percent (6%) per annum thereafter, payable semi-annually on July 1st and January 1st of each year commencing July 1, 1964. No payment of principal shall be required until January 1, 1965. Commencing Junuary 1, 1965, and semi-annually thereafter, the Board of Regents shall pay to the Trustee the sum of $13,603 to be applied first to the payment of interest then due for the previous six months and the balance of the principal. The interest shall be computed semi-annually on the unpaid balance of the principal. The maker of the Bond shall have the privilege of paying any amount on any interest payment date and all amounts so paid shall be applied upon the unpaid principal balance and such prepayment shall not reduce the semi-annual installments required to be paid under said bond. If at any time on or after July 1, 1964, the holder of the bond so requests in writing the Board of Regents agrees at its own expense to prepare, execute, register and deliver to the holder of the bond, in exchange for the bond, printed coupon Revenue Bonds in the denomination of $1,000 each in the total amount of the unpaid balance of the Revenue Bonds. The new $1,000 Revenue Bonds shall bear interest and be payable on such amortized schedule as the Board of Regents and the holder of the bond may agree and in the absence of such Agreement shall bear interest and mature in accordance with the interest requirements and maturity dates of the installments of this bond. The new bonds shall contain the applicable provisions of the original Revenue Bond and when issued shall be surrendered and cancelled and not reissued.
Bond Form
III
Tne original Revenue Bond shall be in substantially the following form:
UNITED STATES OF AMERICA
STATE OF NEBRASKA
THE BOARD OF REGENTS OF THE UNIVERSITY OF NEBRASKA
THE CENTER REVENUE BOND
January 1, 1959
No. 1
$350,000.00
KNOW ALL MEN BY THESE PRESENTS: That The Board of Regents of the University of Nebraska hereby acknowledges itself to owe and for value received promises to pay to Continental National Bank of Lincoln, Nebraska, or order, but only out of the special funds as herein provided, the principal sum of Three Hundred Fifty Thousand Dollars together with interest thereon from date until July 1, 1964, at the rate of three per centum (3%) per annum and thereafter until maturity
- 192 -
203
Special Meeting December 20, 1958
at the rate of six per centum (6%) per annum computed semi-annually on the unpaid balance. Interest only shall be paid until July 1, 1964, semi-annually on the first day of January and July of each year, and thereafter the principal and interest shall be paid in semi-annual installments on the first day of January and July each year in the aggregate amount of Thirteen Thousand Six Hundred Three Dollars ($13,603.00) until the principal and interest on this bond are paid in full but in any event any unpaid balance shall be paid on or before July 1, 1989, said payments to be applied first to the payment of interest then due for the preceding six (6) months and the balance on the principal. Both principal and interest shall be paid at the office of the Trustee in Lincoln, Nebraska. Any installment of principal or interest not paid when due, either by the lapse of time or by the exercise of the option as hereinafter provided, shall draw interest at the rate of nine per centum (9%) per annum until paid. If any installment of principal or interest is not paid when due and the default continues for a period of thirty (30) days after written notice thereof has been given by the holder of this bond to the maker, the holder at its option may declare the entire unpaid balance immediately due and payable.
The maker of this bond reserves the right of paying any amount in addition to the required installments on any interest payment date and all amounts so paid shall be applied on the unpaid principal and shall not reduce the amount of the required installments.
TRUST AGREEMENT
This bond is issued under the provisions of Sections 85-403 to 85-411, Reissue Revised Statutes of Nebraska, 1943, and shall be payable only from the rents, revenues and earnings derived from the use and operation of the facilities known as The Center on the Campus of the University of Nebraska College of Agriculture in Lincoln, Nebraska, and shall not constitute an obligation of the State of Nebraska and no tax shall ever be levied to pay the principal hereof or interest hereon and shall not constitute a debt of the Board of Regents of the University of Nebraska.
The Board of Regents of the University of Nebraska covenants and agrees that as long as this bond, or any part thereof, or interest thereon, remains unpaid and outstanding, it will operate The Center to the best of its ability and establish and maintain such schedule of rates, fees and charges for the use of the facilities afforded by The Center as required to provide funds to operate and maintain The Center and to pay the principal and interest on this bond as the same becomes due and to establish not later than July 1, 1964, and maintain thereafter a Bond Reserve Fund of not less than Twenty-seven Thousand Five Hundred Dollars ($27,500). In event the operating revenues derived from The Center are insufficient to pay all of the above requirements, the maker agrees to furnish heat, light, power and other similar utilities required for the use and operation of The Center without charging the same to the revenues received from the operation of The Center.
All rents, revenues, fees, charges and earnings derived from the operation of The Center are pledged to the payment of this bond and shall be credited daily to a segregated account designated as "Continuing Education Center Account" and used only as provided in the Trust Agreement between the maker and First National Bank of Lincoln dated December 20, 1958.
At any time on or after July 1, 1964, on the written request of the holder of this bond the Board of Regents of the University of Nebraska agrees at its own expense to prepare, execute, register and deliver to the holder of this bond in exchange for this bond printed coupon Revenue Bonds in denomination of $1,000 each in the total amount of the unpaid balance of this bond. The new $1,000 Revenue Bonds shall bear interest and be payable on such amortized schedule as the maker and the holder of this bond may agree and in the absence of such agreement shall bear interest and mature in accordance with the interest requirements and maturity dates
- 193 -
204
Special Meeting December 20, 1958
of the installments of this bond.
IT IS HEREBY CERTIFIED that all acts and things required by the Constitution and the laws of the State of Nebraska to happen, exist and be performed precedent to and in the issuance of this bond have happened, exist and have been performed as so required.
IN WITNESS WHEREOF the Board of Regents of the University of Nebraska has caused this bond to be executed by its President or Vice President and attested by its Secretary or Assistant Secretary and its corporate seal to be affixed all as of the 20th day of December, 1958.
THE BOARD OF REGENTS OF THE UNIVERSITY OF NEBRASKA
By: _______________________________ President
ATTEST:___________________________ Secretary
TRUSTEE'S CERTIFICATE
IT IS HEREBY CERTIFIED that the foregoing Bond is the Bond referred to in the Trust Agreement, dated December 20, 1958, between The Board of Regents of the University of Nebraska and the First National Bank of Lincoln and is secured as provided in said Trust Agreement.
FIRST NATIONAL BANK OF LINCOLN
By: ___________________________
TRUST AGREEMENT
IV
The bond shall be executed on behalf of the Board of Regents by being signed by the President or Vice-President and attested by the Secretary or Assistant Secretary of the Board and shall have its corporate seal attached and the substituted bonds shall be executed in a like manner but the coupons attached thereto may be executed by the facsimile signatures of said officers.
V.
The original Revenue Bond and any bonds issued in exchange therefor shall be registered in the office of the Auditor of Public Accounts in the State of Nebraska and shall be delivered to the Trustee and certified by the Trustee as issued under this Trust Indenture. The original bond shall be delivered by the Trustee to Continental National Bank of Lincoln, Nebraska, upon the payment of par and accrued interest and the substituted bonds shall be delivered to the holder of the original bond or its nominee upon the surrender of said bond and the adjustment of any amounts as evidenced by the original bond and the substituted bonds so that the indebtedness of the Board of Regents shall be in the same amount.
VI
All rents, revenues, fees, charges and earnings derived from the operation of The Center are hereby pledged to the payment of the Revenue Bonds and shall be credited daily to a segregated account designated as "Continuing Education Center Account" and deposited promptly with the State Treasurer of
- 194 -
205
Special Meeting December 20, 1958
the State of Nebraska and shall be used and paid out as follows:
FIRST: For payment of all reasonable operating and maintenance costs. The cost of the annual audit, Trustee's fees and insurance premiums as provided in this Agreement shall be considered as an operating cost.
SECOND: At least 15 days before each payment of interest or principal shall become due, transfer to the Trustee sufficient money to meet such interest and principal. This Fund shall be designated as the "Bond Fund".
THIRD: To pay periodically to the Trustee to be held by the Trustee in a fund known as "Bond Reserve Fund" a sufficient amount so that by July 1, 1964, there will be in said Fund not less than $27,500 principal and interest requirements. In case any funds pledged under this Agreement for any period are insufficient to meet the payment of principal and interest on the bond or bonds as the same become due, the moneys in the Bond Reserve Fund may be used to make said payments and all moneys so used must be restored to the Bond Reserve Fund as soon as the pledged revenues permit so that the Bond Reserve Fund will be continuously maintained after July 1, 1964, at $27,500 or the principal amount of bonds remaining outstanding, whichever is lesser, until all said Revenue Bonds have been paid in full. The money in the Bond Reserve Fund may be invested by the Trustee on written instructions from the Board of Regents or its designated agent in United States Government Bonds, Notes, Certificates, or Bills having a maturity of not more than five years after date of purchase.
TRUST AGREEMENT
FOURTH: As of June 30th of each year all funds remaining in the "Continuing Education Center Account" shall be transferred to one of the following accounts:
(a) MAINTENANCE RESERVE FUND: The money in this Fund shall be used only for the replacement of furniture and equipment and the making of minor capital improvements for which there are no other funds available. The funds shall not exceed the amount which the Board of Regents determines to be reasonably necessary to meet the anticipated needs for said purposes. After the fund has reached the amount so determined, no additional amounts shall be paid into the fund except to restore funds used therefrom. The moneys in this fund may be invested by the Board of Regents in United States Government Bonds, Notes, Certificates and Bills having a maturity of not more than three years from the date of purchase. Any surplus in this fund shall be transferred to the Bond Redemption Fund.
(b) BOND REDEMPTION FUND: The money in this fund shall be used to apply on the principal of the original Revenue Bond or used to prepay any bonds issued in place of the original Bond or Refunding Bonds issued under this Trust Agreement.
VII
As long as the Revenue Bond or Bonds are outstanding and unpaid the Board of Regents shall maintain The Center in good condition and repair and use the facilities for the purposes of continuing education as hereinabove provided and when the building is completed will cause the building and its contents to be insured against loss or damage by fire, lightning, windstorm and extended coverage. Said insurance shall be in an amount of not less than 80% of the insurable value of the buildings and contents and may be wrtitten with an 80% co-insurance clause. During the course of construction of the building insurance shall be maintained on said building in an amount sufficient to indemnify the Board of Regents
- 195 -