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This Bond shall not be valid or become obligatory for any purpose or be entitled to any
<br />security unless the Certificate of Authentication hereon shall have been executed by the Bond
<br />Registrar..
<br />Optional Redemption. All Bonds of this issue (the "Bonds") maturing on February 1,
<br />2018, and thereafter are subject to redemption and prepayment at the option of the Issuer on
<br />February 1, 2017, and on any date thereafter at a price of par plus accrued interest. Redemption
<br />maybe in whole or in part of the Bonds subject to prepayment.. If redemption is in part, the
<br />maturities and the principal amounts within each maturity to be redeemed shall be determined by
<br />the Issuer; and if only part of the Bonds having a common maturity date are called for
<br />prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar.
<br />Bonds or portions thereof called for redemption shall be due and payable on the redemption date,
<br />and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of
<br />redemption shall be given to the paying agent and to each affected Holder of the Bonds.
<br />Selection of Bonds for Redemption; Partial Redemption. To effect a partial redemption
<br />of Bonds having a common maturity date, the Bond Registrar shall assign to each Bond having a
<br />common maturity date a distinctive number for each $5,000 of the principal amount of the Bond.
<br />The Bond Registrar shall then select by lot, using such method of selection as it shall deem
<br />proper in its discretion, from the numbers assigned to the Bonds, as many numbers as, at $5,000
<br />for each number, shall equal the principal amount of the Bonds to be redeemed. The Bonds. to be
<br />redeemed shall be the Bonds to which were assigned numbers so selected; provided, however,
<br />that only so much of the principal amount of the Bond of a denomination of more than $5,000
<br />shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a
<br />Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the
<br />Issuer or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the
<br />Issuer and Bond Registrar duly executed by the Holder thereof or the Holder's attorney duly
<br />authorized in writing) and the Issuer shall execute (if necessary) and the Bond Registrar shall
<br />authenticate and deliver to the Holder of the Bond, without service charge, a new Bond or Bonds
<br />having the same stated maturity and interest rate and of any authorized denomination or
<br />denominations, as requested by the Holder, in aggregate principal amount equal to and in
<br />exchange for the unredeemed portion of the principal of the Bond so surrendered.
<br />Issuance; Purpose; General Obli ag tion. This Bond is one of an issue in the total principal
<br />amount of $10,000,000, all of like date of original issue and tenor, except as to number, maturity,
<br />interest rate, denomination and redemption privilege, issued pursuant to and in full conformity
<br />with the Constitution and laws of the State of Minnesota and pursuant to a resolution adopted by
<br />the Board of Commissioners on October 15, 2007 (the "Resolution"), for the purpose of
<br />providing funds to finance the acquisition and betterment of a recreational facility. This Bond is
<br />payable out of the General Obligation Bonds, Series 2007 Fund of the Issuer. This Bond
<br />constitutes a general obligation of the Issuer, and to provide moneys for the prompt and full
<br />payment of its principal, premium, if any, and interest when the same become due, the full faith
<br />and credit and taxing powers of the. City of Elk River, Minnesota, have been and are hereby
<br />irrevocably pledged pursuant to Ordinance No. 07-13 adopted by the City Council of the City of
<br />Elk River, Minnesota, on October 15, 2007.
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