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B. Prepayment of Registered Bonds.

SECTION 3.06. The installments of principal of Registered Bonds maturing November 1,
1960 through November 1, 1968, inclusive, are not subject to prepayment.

The installments of principal of Registered Bonds maturing November 1, 1969 through
November 1, 1993, inclusive, shall be subject to prepayment prior to the stated maturities thereof,
at the option of the Board, on any interest payment date after November 1, 1968 as a whole,
or, from time to time, in part, in the amount of One Thousand Dollars ($1,000) or any multiple
thereof in the inverse order of maturity of the said installments upon payment of the price for
each One Thousand Dollars ($1,000) principal amount thereof as set forth below, plus accrued interest
thereon to the date fixed for prepayment, to-wit

           

If Prepaid	Prepayment Price (Percentage of Principal Amount Paid)
On or after May 1, 1969 to and including November 1, 1973	103.00%
Thereafter to and including November 1, 1978	102.50%
Thereafter to and including November 1, 1983	102.00%
Thereafter to and including November 1, 1988	101.50%
Thereafter at	101.00%

The installments of principal of Registered Bonds maturing November 1, 1994 through November 1,
1998, inclusive, shall be subject to prepayment prior to the stated maturities thereof, at the option
of the Board, on any interest payment date from and after the issuance and delivery thereof, as a
whole, or, from time to time, in part, in the amount of One Thousand Dollars ($1,000) or any multiple
thereof in the inverse order of maturity of the said installments upon payment of the principal
amount thereof, plus accrued interest to the date fixed for prepayment.

In the event the Board shall exercise its option to prepay the principal installments
of any of the Registered Bonds prior to the stated maturities thereof as herein provided, the
principal installments maturing November 1, 1994 through November 1, 1998, inclusive, shall
first be prepaid

SECTION 3.07. Notice of any prepayment of the principal of any Registered Bond, or
any portion thereof, as hereinabove permitted shall be given by Registered Mail to the Registered
Owner of any such Registered Bond at least thirty (30) days prior to the date fixed
for prepayment, the amount of principal to be prepaid, the premium thereon, if any, and the
amount of accrued interest thereon to the date of prepayment.

SECTION 3.08. Anything herein to the contrary notwithstanding, so long as the Registered
Owner of any Registered Bond is the Government, the Board may, at its option, prepay,
on any date, the entire unpaid principal amount of any such Registered Bond so owned, or any
lesser portion of the said principal amount, from time to time, in the amount of One Thousand
Dollars ($1,000) or any multiple thereof, in the inverse order of maturity of the installments
of principal of any such Registered Bond, or of the said installments thereof, together with
accrued interest to the date of prepayment, it being the intent of this Section 3.08 that as
long as the Government is the Registered Owner of any such Registered Bond, all noncallable
provisions applicable to the principal of any such Registered Bond, or applicable to any of
the installments of principal thereof, all premiums for the prepayment of the principal of
any such Registered Bond, or for the prepayment of any of the installments of principal thereof,
all provisions for the publishing or mailing of notice of prepayment and all specific prepayment
dates, shall be deemed and considered as waived.

SECTION 3.09. Notice of any prepayment having been given in accordance with the requirements
of Section 3.07 of this Article III unless waived by the provisions of Section 3.08,
and the principal amount to be prepaid, the premium thereon, if any, and the accrued interest
payable thereon having been deposited with the State Treasurer, and having been set aside by
the State Treasurer for that purpose, as provided in this Resolution, on or prior to the date
of prepayment, the principal amount of any Registered Bond so called or designated for prepayment
shall become payable on the prepayment date so designated and the interest upon such principal
amount shall cease upon such prepayment date, whether or not a notation of such prepayment
is made upon the Payment Record attached to any such Registered Bond. During the time that the
Government is the Registered Owner of any Registered Bond, any prepayment of such Bond so owned
shall be made at the principal office of the Federal Reserve Bank of Richmond, Richmond, Virginia,
or at the principal office of any other depositary as the Government shall designate, and such
prepayment, except final payment, may be without the presentation or surrender of the Registered
Bond to the Treasury Board, but such prepayment shall be noted on the Payment Record
attached to such Registered Bond by the said Federal Reserve Bank of Richmond, or by any other
authorized depositary. If the Government shall assign any Registered Bond owned by it, any
prepayment to any assignee shall be made only upon the surrender by such assignee of such
Registered Bond to the Treasury Board for notation of such prepayment upon the said Payment Record.