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Payments of the principal and interest installments due hereon shall be made, except for final payment, without presentation and surrender of this bond, directly to the registered owner at his address shown on the bond registration book of the City maintained by the City Clerk as Bond Registrar, and such payments shall fully discharge the obligation of the City to the extent of the payments so made. This bond is issued for the purpose of providing financing of a portion of the costs of acquiring, constructing and equipping extensions, betterments and improvements to the City's sewer system, and costs of authorizing and issuing this bond, and is issued pursuant to and in full compliance with the Constitution and laws of the State of Arkansas (the "State"), including particularly Amendment No. 62 to the Arkansas Constitution and the Arkansas Code of 1987 Annotated, Title 14, Chapter 164, Subchapter 3 (the "Authorizing Legislation"), and pursuant to Ordinance No. 2009-12-1 of the City, duly adopted and approved on the 22nd day of December, 2009, Ordinance No. 2011-06-03 of the City, duly adopted and approved on the 28th day of June, 2011, and Ordinance NocZOIZ—Clw-0I of the City, duly adopted and approved on the 25th day of June, 2013 (collectively, the "Authorizing Ordinance") and an election duly held on March 10, 2009 at which the majority of the legal voters of the City voting on the question approved the issuance of this bond. Reference is hereby made to the Authorizing Ordinance for the details of the nature and extent of the security and of the rights and obligations of the City and the registered owner of this bond. This bond may be assigned with the written approval of the Arkansas Natural Resources Commission (the "Commission"), and in order to effect such assignment the assignor shall promptly notify the City Clerk by registered mail, and the assignee shall surrender this bond along with a written approval of the Commission to the City Clerk for transfer on the registration records. Every assignee shall take this bond subject to all payments and prepayments of principal (as reflected by the Payment Record maintained by the City Clerk), prior to such surrender for transfer. This bond does not constitute an indebtedness of the City within any constitutional or statutory limitation or provision. This bond is a special obligation payable solely from a pledge of collections of the City's 1% sales and use tax, levied by Ordinance No. 2009-1-1 of the City duly adopted on January 13, 2009 under the authority of the Authorizing Legislation (the "Tax"), and the City hereby pledges its collections of the Tax for the payment of this bond. The pledge in favor of the bond is on a parity with the pledge in favor of the City's Sales and Use Tax Bond, Series 2010 (the "Series 2010 Bond") and the City's Sales and Use Tax Bond, Series 2011 (the "Series 2011 Bond"). The City has reserved the right in the Authorizing Ordinance to issue additional bonds, in the principal amount of $10,200,000, on a parity of security with this bond, the Series 2010 Bond and the Series 2011 Bond ("Additional Parity Bonds"). This bond may be prepaid, at the option of the City, in whole or in part at any time from Tax collections in excess of the amount necessary to insure the prompt payment of the principal of and interest on this bond, the Series 2010 Bond, the Series 2011 Bond and the Additional Parity Bonds ("Surplus Tax Collections") as the same becomes due at the prepayment price equal to the principal amount being prepaid plus accrued interest to the prepayment date. The City shall determine the bonds to be redeemed from Surplus Tax Collections. 5