ORD 95-44 LID 13ORDINANCE NO. 95-44
AN ORDINANCE relating to Local Improvemere District No. 13; fixing the
mount, form, date, interest rates, maturity and denominations of the Local
Improvement District No. 13 Bonds; providing for the sale and delivery thereof to
Pacific Crest Securities in Seattle, Washington; and fixing the interest rate on Local
Improvement District No. 13 assessment installments.
This document prepared by:
Foster Pepper & Shefelman
1111 Third Avenue, Suite 3400
Seattle, Washington 98101
(206) 4474400
ORDINANCE NO. 95-44
AN ORDINANCE relating to Local Improvement District No. 13; fixing the
mount, form, date, interest rates, maturity and denominations of the Local
Improvement District No. 13 Bonds; providing for the sale and delivery thereof to
Pacific Crest Securities in Seattle, Washington; and fixing the interest rate on Local
Improvement District No. 13 assessment installments.
THE CITY COUNCIL OF THE CITY OF BAINBRIDGE ISLAND, WASHINGTON, DO
ORDAIN as follows:
Section 1. Authorization and Description of Bonds. The total mount of the assessment roll
in Local Improvement District No. 13 (the "District") in the City of Bainbridge Island, Washington
(the HCity'), created under Ordinance No. 90-05, passed February 15, 1990, was $1,459,653. The
30-day period for making cash payments of assessments without interest in the District expired on
October 13, 1995, and no assessments were paid in cash therefore leaving a balance of assessments
unpaid on the assessment roll in the sum of $1,459,653. Local Improvement District No. 13 Bonds
(the "Bonds") shall, therefore, be issued in the total principal sum of $1,459,653. The Bonds shall
be dated December 15, 1995, shall mature on December 15, 2007, and shall be numbered from 1
to 292, inclusive, in the manner and with any additional designation as the Bond Registrar
(collectively, the fiscal agencies of the State of Washington located in Seattle, Washington, and New
York, New York) deems necessary for the purpose of identification. Bond No. 1 shall be in the
denomination of $4,653 and Bonds Nos. 2 to 292, inclusive, shall be in the denomination of
$5,000.00 each. Interest shall be computed on the basis of a 360-day year of twelve 30-day months.
The Bonds shall bear interest, payable annually on December 15 of each year beginning
December 15, 1996, in accordance with the following schedule:
Bond Numbers Interest
(inclusive) Amounts Rates
1 to 30 $149,653 4.00%
31 to 61 155,000 4.25
62 to 91 150,000 4.45
92 to 122 155,000 4.65
123 to 152 150,000 4.85
153 to 182 150,000 5.00
183 to 212 150,000 5.10
213 to 242 150,000 5.20
243 to 272 150,000 5.30
273 to 292 100,000 5.40
~_~Ik~2. Registration and Transfer of Bonds. The Bonds shall be issued only in registered
form as to both principal and interest and shall be recorded on books or records inaint_alned by the
Bond Registrar (the "Bond Register"). Such Bond Register shall contain the name and mailing
address of the owner of each Bond and the principal amount and number of each of the Bonds held
by each owner.
Bonds may be transferred only if endorsed in the manner provided thereon and surrendered
to the Bond Registrar. The transfer of a Bond shall be by the Bond Registrar's receiving the Bond
to be transferred, cancelling it and issuing a new certificate in the form of the Bonds to the transferee
after registering the name and address of the transferee on the Bond Register. The new certificate
shall bear the same Bond number as the transferred Bond but may have a different inventory
reference number or control number. Any exchange or transfer shall be without cost to the owner
or transferee. The Bond Registrar shall not be obligated to exchange or transfer any Bond during
the 15 days preceding any principal payment or redemption date.
Section 3. Payment of Bonds. Both principal of and interest on the Bonds shall be payable
solely out of the Local Improvement Fund, District No. 13 (the "Bond Fund"), and from the Local
Improvement Guaranty Fund of the City, and shall be payable in lawful money of the United States
of America. Interest on the Bonds shall be paid by check or draft mailed to the registered owners
on the interest payment date at the addresses appearing on the Bond Register on the last business day
of the month preceding the interest payment date. Principal of the Bonds shall be payable upon
presentation and surrender of the Bonds by the registered owners at either of the principal offices
of the Bond Registrar, at the option of the owners.
Section 4. Redemption Provisions. The City reserves the right to redeem the Bonds prior
to their stated maturity on any interest payment date, in numerical order, lowest numbers first, at
par plus accrued interest to the date fixed for redemption, whenever there shall be sufficient money
in the Bond Fund to pay the Bonds so called and all earlier numbered Bonds over and above the
amount required for the payment of the interest payable on that interest payment date on all unpaid
Bonds.
All Bonds redeemed under this section shall be cancelled.
Section 5. Notice of Redemption. The City shall cause notice of any intended redemption
of Bonds to be given not less than 15 nor more than 30 days prior to the date f'txed for redemption
by first-class mail, postage prepaid, to the registered owner of any Bond to be redeemed at the
address appearing on the Bond Register at the time the Bond Registrar prepares the notice, and the
requirements of this sentence shall be deemed to have been ful~lled when notice has been mailed as
so provided, whether or not it is actually received by the owner of any Bond. Interest on Bonds
called for redemption shall cease to accrue on the date fixed for redemption unless the Bond or
Bonds called are not redeemed when presented pursuant to the call. In addition, the redemption
notice shall be mailed within the same period, postage prepaid, to Pacific Crest Securities at its
prineipai office in Seattle, Washington, or its successor, and to such other persons and with such
additional information as the City Finance Director shall determine, but these additional mailings
shall not be a condition precedent to the redemption of Bonds.
Section 6. Failure to Redeem Bonds. If any Bond is not redeemed when properly presented
at its maturity or eail date, the City shall be obligated to pay interest on that Bond at the same rate
provided in the Bond from and after its maturity or call date until that Bond, both principal and
interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond
Fund and the Bond has been called for payment by giving notice of that call to the registered owner
of each of those unpaid Bonds.
Section 7. Form and Execution of Bonds. The Bonds shall be printed, lithographed or typed
on good bond paper in a fonu consistent with the provisions of this ordinance and state law, shall
be signed by the Mayor and the City Clerk, either or both of whose signatures may be manual or
in facsimile, and the seal of the City or a facsimile reproduction thereof shall be impressed or printed
thereon.
Only Bonds bearing a Certificate of Authentication in the following form, manually signed
by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the benefits of this
ordinance:
CERTIFICATE OF AUTHENTICATION
This Bond is one of the fully registered City of Bainbridge Island,
Washington, Local Improvement District No. 13 Bonds described in the Bond
Ordinance.
Washington State Fiscal Agency
Bond Registrar
By
Authorized Signer
The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bond
so authenticated has been duly executed, authenticated and delivered and is entitled to the benefits
of this ordinance.
If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the
City authorized to sign bonds before the Bonds bearing his or her facsimile signature are
authenticated or delivered by the Bond Registrar or issued by the City, those Bonds nevertheless may
be authenticated, issued and delivered and, when authenticated, issued and delivered, shall be as
binding on the City as though that person had continued to be an officer of the City authorized to
sign bonds. Any Bond also may be signed on behalf of the City by any person who, on the actual
date of signing of the Bond, is an officer of the City authorized to sign bends, although he or she
did not hold the required 'office on the date of issuance of the Bond.
Section 8. Bond Registrar. The Bond Registrar shall keep, or cause to be kept, at its
principal corporate trust office, sufficient books for the registration and transfer of the Bonds which
shall be open to inspection by the City at all times. The Bond Registrar is authorized, on behalf of
the City, to authenticate and deliver Bonds transferred or exchanged in accordance with the
provisions of the Bonds and this ordinance, to serve as the City's paying agent for the Bonds and
0210325.03 -3-
to carry out all of the Bond Registrar's powers and duties under this ordinance and City Ordinance
No. 83-10 establishing a system of registration for the City's bonds and obligations.
The Bond Registrar shall be responsible for its representations contained in the Bond
Registrar's Certificates of Authentication on the Bonds. The Bond Registrar may become the owner
of Bonds with the same rights it would have if it were not the Bond Registrar and, to the extent
pen,~tted by law, may act as depository for and permit any of its officers or directors to act as
members of, or in any other capacity with respect to, any committee formed to protect the rights of
Bond owners.
Section 9. Bonds Negotiable. The Bonds shall be negotiable instruments to the extent
provided by RCW 62A.8-102 and 62A.8-105.
Section 10. Preservation of Tax Exemption for Interest on Bonds. The City covenants that
it will take all actions necessary to prevent interest on the Bonds from being included in gross income
for federal income tax purposes, and it will neither take any action nor make or permit any use of
proceeds of the Bonds or other funds of the City treated as proceeds of the Bonds at any time during
the te~m of the Bonds which will cause interest on the Bonds to be included in gross income for
federal income tax purposes. The City certifies that it has not been notified of any listing or
proposed listing by the Internal Revenue Service to the effect that it is a bond. issuer whose arbitrage
certifications may not be relied upon.
Section 11. Small Governmental Issuer Arbitrage Rebate Exception and Designation of
Bonds as "Ouali~ed Tax-Exempt Obligations." The City finds and declares that (a) it is a duly
organized and existing governmental unit of the State of Washington and has general taxing power;
(b) no Bond which is part of this issue of Bonds is a "private activity bond" within the meaning of
Section 141 of the United States Internal Revenue Code of 1986, as amended (the "Code"); (e) at
least 95 % of the net proceeds of the Bonds will be used for local governmental activities of the City
(or of a governmental unit the jurisdiction of which is entirely within the jurisdiction of the City);
(d) the aggregate face amount of all tax-exempt obligations (other than private activity bonds and
other obligations not required to be included in such calculation) issued by the City and all entities
subordinate to the City (including any entity which the City controls, which derives its authority to
issue tax-exempt obligations from the City or which issues tax-exempt obligations on behalf of the
City) during the calendar year in which the Bonds are issued is not reasonably expected to exceed
$5,000,000; and (e) the amount of tax-exempt obligations, including the Bonds, designated by the
City as "qualified tax-exempt obligations" for the purposes of Section 265(b)(3) of the Code during
the calendar year in which the Bonds are issded does not exceed $10,000,000. The City therefore
certifies that the Bonds are eligible for the arbitrage rebate exception under Section 148(f)(4)(D) of
the Code and designates the Bonds as "qualified tax-exempt obligationsm for the purposes of
Section 265(b)(3) of the Code.
Section 12. Use of Bond Proceeds. The accrued interest on the Bonds received from the
Bond purchaser shall be used to pay debt service on the Bonds on the first interest payment date.
The principal proceeds of the Bonds shall be used to finance the costs of carrying out the
improvements in the District as ordered pursuant to Ordinance No. 90-05 of the City and to pay the
costs of issuance of the Bonds. Until needed to pay those costs, .the City may invest principal
proceeds temporarily in any legal investment, and the investment earnings may be retained in the
Bond Fund and be spent for the purposes of that fund.
Section 13. Approval of Bond Purchase Contract. Pacific Crest Securities of Seattle,
Washington, has presented a purchase contract (the "Bond Purchase Contract") to the City offering
to purchase the Bonds under the teii~s and conditions provided in the Bond Purchase Contract, which
written Bond Purchase Contract is on file with the City Clerk and is incorporated herein by this
reference. The City Council finds that entering into the Bond Purchase Contract is in the City's best
interest and therefore accepts the offer contained therein and authorizes its execution by City
officials.
The Bonds will be printed at City expense and will be delivered to the purchaser in
accordance with the Bond Purchase Contract, with the approving legal opinion of Foster Pepper &
Shefelman, municipal bond counsel of Seattle, Washington, regarding the Bonds printed on each
definitive Bond. Bond counsel shall not be required to review and shall express no opinion
concerning the completeness or accuracy of any official statement, offering circular or other sales
material issued or used in connection with the Bonds, and bond counsel's opinion shall so state.
The proper City officials are authorized and directed to do everything necessary for the
prompt delivery of the Bonds to the purchaser, including without limitation the execution of the
Official Statement on behalf of the City, and for the proper application and use of the proceeds of
the sale thereof.
Section 14. Preliminary Official Statement Deemed Final. The City Council has been
provided with copies of a preliminary official statement dated November 24, 1995 (the "Preliminaxy
Official Statement"), prepared in connection with the sale of the Bonds. For the sole purpose of the
Bond purchaser's compliance with Securities and Exchange Commission Rule 15c2-12(b)(1), the City
"deems final" that Preliminary Official Statement as of its date, except for the omission of
info~t~ation as to offering prices, interest rates, selling compensation, aggregate principal amount,
principal amount per maturity, maturity dates, options of redemption, delivery dates, ratings and
other terms of the Bonds dependent on such matters.
Section 15. Temporary Bond. Pending the printing, execution and delivery to the purchaser
of definitive Bonds, the City may cause to be executed and delivered to the purchaser a single
temporary Bond in the total principal amount of the Bonds. The temporary Bond shall bear the same
date of issuance, interest rates, principal payment dates and terms and covenants as the definitive
Bonds, shall be issued as a fully registered Bond in the name of the purchaser, and otherwise shall
be in a form acceptable to the purchaser. The temporary Bond shall be exchanged for defmitive
Bonds as soon as they are printed, executed and available for delivery.
Section 16. Fixing Interest Rate on Assessments. The interest rate on the installments and
delinquent payments of the special assessments in the District is revised and fixed at the rate of
5.60% per annum.
Section 17. Assessment Roll Appeals. The owner of Parcel 14i, the owner of Parcel 12,
the owner of Parcel 8 and the owner of Parcels 7 and 9 have filed notices of appeal from the
approval of the final assessment roll in LID No. 13 as it relates to their parcels. The matter is
-5-
awaiting hearing in the King County Superior Court. The total value of the appealed assessments
is $208,259. While the City anticipates that the appeals can be defended successfully, the City
covenants that it shall budget and provide from other City funds and shall deposit promptly in the
Bond Fund any mounts by which those appealed assessments may be reduced.
Section 18. Undertaking to Provide Continuing Disclosure. Because it will have outstanding
less than $10,000,000 of obligations after the issuance of the Bonds, the City is currently exempt
from the requirements of United States Securities and Exchange Commission CSEC") Rule 15c2-
12Co)(5) (the "Rule"), as applicable to a participating underwriter for the Bonds, however, the City
makes the following written undertaking (the "Undertaking") for the benefit of holders of the Bonds:
(a) Undertaking to Provide Annual Financial Information and Notice of
Material Events. The City undertakes to provide or cause to be provided, either
directly or through a designated agent:
(i) To each nationally recognized municipal securities information
repository designated by the SEC in accordance with the Rule CNRMSIR'')
and to a state information depository, if any, established in the state of
Washington (the "SID") annual financial information and operating data of the
type included in the final official statement for the Bonds and described in
Section 18Co) ("annual financial information");
(ii) To each NRMSIR or the Municipal Securities Rulemaking Board
("MSRB"), and to the SID, timely notice of the occurrence of any of the
following events with respect to the Bonds, if material: (1) principal and
interest payment delinquencies; (2) non-payment related defaults;
(3) unscheduled draws on debt service reserves reflecting financial
difficulties; (4) unscheduled draws on credit enhancements reflecting financial
difficulties; (5) substitution of credit or liquidity providers, or their failure to
perform; (6) adverse tax opinions or events affecting the tax-exempt status of
the Bonds; (7) modifications to rights of holders of the Bonds; (8) Bond calls
(other than scheduled mandatory redemptions of Term Bonds);
(9) .defeasances; (10)release, substitution, or sale of property securing
repayment of the Bonds; and (11) rating changes; and
(iii) To each NRMSIR or to the MSRB, and to the SID, timely notice
of a failure by the City to provide required annual financial information on
or before the date specified in Section 18Co).
(b) Type of Annual Financial Information Undertaken to be Provided.
The annual financial information that the City undertakes to provide in Section 18(a):
(i) Shall consist of (1) assessments of the District liald during the previous
fiscal year; (2) assessments owed on the District at fiscal year end and assessments
delinquent on the District at fiscal year end; (3) outstanding balance of obligations
0210325.03
secured by the Guaranty Fund at fiscal year end; (4) balance in the Guaranty Fund
at fiscal year end; and (5) annual financial statements for the City;
(ii) Shall be prepared (except as noted in the financial statements) in
accordance with applicable generally accepted accounting principles
promulgated by the Government Accounting Standards Board CGASB"), as
such principles may be changed from time to time by GASB or its successor;
(iii) Shall not be audited, except, that if and when audited financial
statements are otherwise prepared and available to the City they be will be
available from the Finance Director of the City;
(iv) Shall be provided to each NRMSIR and the SID, not later than
the last day of the ninth month after the end of each fiscal year of the City
(currently, a fiscal year ending December 31), as such fiscal year may be
changed as required or permitted by State law, commencing with the City's
fiscal year ending December 31, 1996; and
(v) May be provided in a single or multiple documents, and may
be incorporated by reference to other documents that have been filed with
each NRMSIR and the SID, or, if the document incorporated by reference is
a "final official statement" with respect to other obligations of the City, that
has been filed with the MSRB.
(c) Amendment of Undertaking. The Undertaking is subject to
amendment after the primary offering of the Bonds without the consent of any holder
of any Bond, or of any broker, dealer, municipal securities dealer, participating
underwriter, rating agency, NRMSIR, the SID or the MSRB, under the circumstances
and in the manner permitted by the Rule.
The City will give notice to each NRMSIR or the MSRB, and the SID, of the
substance (or provide a copy) of any amendment to the Undertaking and a brief
statement of the reasons for the amendment. If the amendment changes the type of
annual financial infot,ctation to be provided, the notice also will include a narrative
explanation of the effect of that change on the type of information to be provided.
(d) Beneficiaries. The Undertaking evidenced by this Section 18 shall
inure to the benefit of the City and any holder of Bonds, and shall not inure to the
benefit of or create any rights in any other person.
(e) Termination of Undertaking. The City's obligations under this
Undertaking shall terminate upon the legal defeasance of all of the Bonds. In
addition, the City's obligations under this Undertaking shall terminate if those
provisions of the Rule which require the City to comply with this Under,aking
become legally inapplicable in respect of the Bonds for any reason, as confmued by
an opinion of nationally recognized bond counsel or other counsel familiar with
0210~2~.03 -7-
federal securities laws delivered to the City, and the City provides timely notice of
such termination to each NRMSIR or the MSRB and the SID.
(f) Remedy for Failure to Comply with Undertaking. As soon as
practicable after the City or any other obligated person learns of any failure to
comply with the Undertaking, the City will proceed with due diligence to cause such
noncompliance to be corrected. No failure by the City or other obligated person to
comply with the Undertaking shall constitute a default in respect of the Bonds. The
sole remedy of any holder of a Bond shall be to take such actions as that holder
deems necessary, including seeking an order of specific performance from an
appropriate court, to compel the City or other obligated person to comply with the
Undertaking.
(g) Designation of Official Responsible to Administer Undertaking. The
Finance Director of the City or his or her designee (or such other officer of the City
who may in the future perform the duties of the Finance Director) is authorized and
directed in his or her discretion to take such further actions as may be necessary,
appropriate or convenient to carry out the Undertaking of the City in respect of the
Bonds set forth in this Section 18 and in accordance with the Rule, including, without
limitation, the following actions:
(i) Preparing and filing the annual financial information undertaken
to be provided;
(ii) Determining whether any event specified in Section 18(a) has
occurred, assessing its materiality with respect to the Bonds, and, if material,
preparing and disseminating notice of its occurrence;
(iii) Determining whether any person other than the City is an
"obligated person" within the meaning of the Rule with respect to the Bonds,
and obtaining from such person an undertaking to provide any annual
financial information and notice of material events for that person in
accordance with the Rule;
(iv) Selecting, engaging and compensating designated agents and
consultants, including but not limited to financial advisors and legal counsel,
to assist and advise the City in carrying out the Undertaking; and
(v) Effecting any necessary amendment of the Undertaking.
0210'325.03
Section 19. Effective Date of Ordinance. This ordinance shall take effect and be in force
five days from and after its passage, approval and publication as required by law.
PASSED by the City Council this 30th day of November, 1995.
APPROVED by the Mayor this ~ip_~day of November, 1995.
ATTEST/AUTHENTICATED:
Mayor
City Clerk
APPROVED AS TO FORM:
City Aaorney
FILED WITH CITY CLERK: .A/~7
PASSED BY THE CITY COUNCIL:
PUBLISHED: /~- '
EFFECTIVE DATE: /~- -//-
ORDINANCE NO.: 9544
I, SUSAN P. KASPER, City Clerk of the City of Bainbridge Island, Washington, certify that
the attached copy of Ordinance No. 95-44 is a true and correct copy of the original ordinance passed
on the 30th day of November, 1995, as that ordinance appears on the Minute Book of the City.
DATED this 3o day of '){.e-~e~, 1995.
CITY of BAINBRIDGE ISLAND
$1,459,653
Local Improvement District No 13 Bonds, 1995
Members of the City Council
City of Bainbridge Island
625 Winslow Way E.
Bainbridge Island, WA 98110
November 30, 1995
Honorable Members of the City Council:
Pacific Crest Securities, Inc. (the "Purchaser") offers to purchase from The City of Bainbridge
Island, Washington (the "Seller"), and upon acceptance hereof the Seller will agree to sell to
the Purchaser, all of the Bonds described above and on Appendix A (attached and incorporated
herein by this reference), subject to the terms, conditions, covenants, representations and
warranties contained in this Purchase Contract, including the Appendices.
Section 1. Purchase, Sale and Delivery of the Bonds.
(a)
Appendix A contains a brief description of the Local Improvement District No 13
Bonds (the "Bonds") and the purchase price, interest rate or rates, maturity schedule,
redemption provisions and date and time of delivery and payment (the "Closing Date")
of the Bonds. The Bonds shall be as described in Appendix A, and in an Official
Statement (the "Official Statement") approved by the Seller in accordance with
paragraph (b) hereof satisfactory in form and substance to the Purchaser.
(b)
The Seller authorizes the Purchaser to use and distribute an Official Statement as
deemed final by the Ordinance authorizing the Bonds with such changes made in
conformity with this purchase contract and accepting that Official Statement, this
Purchase Contract and all information contained in them, and the documents, and
certificates formally delivered to the Purchaser by the Seller as a Bond issue legal
transcript on the Closing Date or at such other time agreed to by the Purchaser and
Seller, in connection with the transactions contemplated by this Purchase Contract.
(c)
The Bonds shall be delivered to the Purchaser in definitive or temporary form on the
Closing Date, duly executed by the authorized officers of the Seller, together with the
other documents described in this Purchase Contract. The Bonds shall be in registered
form. Subject to the provisions of this Purchase Contract, the Purchasers shall accept
delivery of the Bonds on the Closing Date and will pay the purchase price set forth in
Appendix A, together with accrued interest as applicable wire transfer, payable in
Federal funds as designated by the Seller.
Section 2. Representations, Warranties and Agreements of the Seller.
The Seller represents, warrants and agrees with the Purchaser the matters set forth below;
which representations, warranties and agreements are true and in effect as of the date of this
Purchase Contract and shall be true and in effect as of the Closing Date:
(a)
the Seller is a duly organized and existing municipal corporation of the State of
Washington with the full legal right, power and authority to enter into and perform this
Purchase Contract, to pass the Ordinance authorizing issuance of the Bonds (the
"Ordinance"), to deliver and sell the Bonds to the Purchaser, and to carry out all the
other transactions contemplated by this Purchase Contract, the Ordinance, and the
Official Statement;
(b)
the Seller has duly and validly pass or will pass the Ordinance before the Closing Date,
will take any and all action as will be necessary to carry out, give effect to and
consummate the transactions contemplated herein, and as of the date of this Purchase
Contract and as of the Closing Date the Ordinance, the Bonds and this Purchase
Contract will constitute the valid, legal and binding obligations of the Seller in
accordance with their respective terms, and the Ordinance will be in full force and
effect;
(c)
this Purchase Contract, the Ordinance, and the Bonds do not and will not conflict with
or create a breach or default under any existing law, regulation or order, or any
agreement or instrument to which Seller is subject; which breach or default would
impair the authority of the Seller to issue the Bonds or the security for the payment of
the Bonds;
(d)
all approvals, consents, authorizations, elections and orders of or filings or registrations
with any governmental authority, board, agency or commission having jurisdiction
which would constitute a condition precedent to, or the absence of which would
materially adversely affect, the performance by the Seller of its obligations under this
Purchase Contract, the Ordinance, the Bonds, and any other instruments contemplated
in this transaction have been obtained and are in full force and effect, except that the
Seller expresses no warranty with respect to Purchaser's compliance with securities or
blue sky laws of any jurisdiction;
(e)
the Bonds, when delivered in accordance with the Ordinance and paid for by the
Purchaser on the Closing Date as provided herein, will be validly issued and
outstanding binding obligations of the Seller enforceable in accordance with their
terms, subject only to applicable bankruptcy, insolvency or other similar laws generally
affecting creditors' rights and principles of equity if equitable remedies are sought;
(f)
the Official Statement (as supplemented with the approval of the Purchaser, if the
Official Statement shall have been supplemented) will be, as of the Closing Date, true,
correct and complete in all material respects and does not, and will not as of the
Closing Date, contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading;
(g)
for a period of 25 days from the date hereof or until such time (if earlier) as the
Purchaser shall no longer hold any of the Bonds for sale, if any event shall occur as a
result of which it is necessary to supplement the Official Statement in order to make the
statements therein, in light of the circumstances existing at such time, not misleading,
the Seller shall forthwith notify the Purchaser of any such event of which it has
knowledge and shall cooperate fully in the preparation and furnishing of any
supplement to the Official Statement necessary, in the Purchaser's opinion so that the
statements therein as so supplemented will not be misleading in light of the
circumstances existing at such time;
(h)
no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by
any court, regulatory agency, public board or body, is pending or, to the knowledge of
the Seller, threatened in any way affecting the existence of the Seller or the titles of its
officers to their respective offices, or seeking to restrain or to enjoin the issuance, sale
or delivery of the Bonds, the application of the proceeds thereof in accordance with the
Ordinance, or, except as set forth in the Ordinance, the collection of special
assessments levied against benefited properties within LID No 13 to pay the principal
of and interest on the Bonds, or the pledge thereof or of the proceeds of the Bonds, or
in any way contesting or affecting the validity or enforceability of the Bonds;
(i)
any certificate signed by an authorized officer of the Seller shall be deemed a
representation and warranty by the Seller to the Purchaser as to the statements made
therein; and
(j)
the Seller has not been notified of any listing or proposed listing by the Internal
Revenue Service to the effect that it is a Bond issuer whose arbitrage certifications may
not be relied upon.
(k)
the Seller agrees to cooperate with the Purchaser to permit the Purchaser to deliver or
cause to be delivered, within seven business days after any final agreement to purchase,
offer, or sell the securities and in sufficient time to accompany any confirmation that
requests payment from any customer of the Purchaser, copies of a final Official
Statement in sufficient quantity to comply with paragraph (b)(4) of the S. E. C. Rule
15c2-12 and the rules of the Municipal Securities Rulemaking Board. The Purchaser
agrees to deliver three copies to each nationally recognized municipal securities
information repository of the business day on which the final Official Statement is
available, and in any event no later than seven business days after the date hereof.
Section 3. Conditions to the Ob~gations of the Purchaser.
The obligations of the Purchaser to accept delivery of and pay for the Bonds on the Closing
Date shall be subject to the accuracy in all material respects of the representations and
warranties on the part of the Seller contained herein as of this date and as of the Closing Date,
to the accuracy in all material respects of the statements of the officers of the Seller made in
any certificates or other documents furnished pursuant to the Purchase Contract, to the
performance by the Seller of its obligations to be performed hereunder at or prior to the
Closing Date, and to the following additional conditions:
(a)
(b)
(c)
(d)
on the Closing Date, the Ordinance shall have been duly authorized, executed and
delivered by the Seller, and in substantially the form heretofore submitted to the
Purchaser, with only such changes as shall have been agreed to in writing by the
Purchaser, and there shall have been taken in connection therewith, with the issuance
of the Bonds and with the transactions contemplated thereby and by this Purchase
Contract, all such actions as, in the opinion of either the Purchaser or the Seller, shall
be necessary or appropriate;
on the Closing Date, the Official Statement shall not have been amended, modified or
supplemented, except as may have been agreed to by the Purchaser and the Seller;
Between the date hereof and the Closing Date, the marketability of the Bonds shall not
have been materially adversely affected, in the reasonable judgment of the Purchaser,
by reason of any of the following:
(1) a material adverse change in the financial condition or general affairs of Seller or
of properties to be assessed within LID No. 13:
(2)
an event, court decision, proposed or adopted law or rule which would have a
material adverse effect on the federal income tax incident to the Bonds or the
contemplated transactions;
(3)
an international or national crises, suspension of stock exchange trading or
banking moratorium materially affecting the marketability of the Bonds or the
Purchaser' s ability to deliver funds due to such banking moratorium; and
(4)
any event occurring, or information becoming known which makes untrue in any
material respect any statement or information contained in the Official Statement,
or has the effect that the Official Statement contains any untrue statement of
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
On or prior to the Closing Date, the Purchaser will have received from the Seller the
following documents, in each case satisfactory in form and substance to the Purchaser
acting reasonably:
(1) the Bonds, in definitive or temporary form, duly executed;
(2) the Ordinance and the Official Statement, each executed on behalf of the Seller
by an authorized officer;
(3)
the Ordinance or other Certificate in which the Seller deems the Preliminary
Official Statement "final" as of its date, except for the omission of information
dependent upon the pricing of the issue and the completion of the underwriting
agreement, such as offering prices, interest rates, selling compensation,
aggregate principal amount, principal amount per maturity, delivery date, and
other terms of the Bonds dependent on the foregoing matters.
(4)
(5)
the approving opinion of Bond Counsel satisfactory to Purchaser, dated the
Closing Date, substantially in the form of Appendix A of the Official Statement,
attached and incorporated herein by this reference; with appropriate changes to
reflect the purchase of the Bonds as described herein;
(6)
a certificate setting forth the facts, estimates and circumstances in existence on
the Closing Date which establish that it is not expected that the proceeds of the
Bonds will be used in a manner that could cause the Bonds to be "arbitrage
bonds" within the meaning of Section 148 of the Internal Revenue Code and
applicable regulations; and
a certificate signed by an authorized officer of the Seller, to the effect that, except
as previously disclosed to the Purchaser and described in the Preliminary Official
Statement, no litigation is pending, or to such officer's knowledge threatened,
restraining or enjoining the issuance, sale, execution or delivery of the Bonds,
collection of assessments from the properties within LID No. 13, enforcement of
the liens thereon or affecting the Local Improvement Guaranty Fund's ability to
pay the principal of or interest on the Bonds, or adversely affecting the Seller's
right or authority to carry out the terms and conditions of the Ordinance;
Section 4. Expenses.
(a) Seller's Expenses
Whether or not the Purchaser accepts delivery of and pays for the Bonds as set forth
herein, the Purchaser shall be under no obligation to pay, and the Seller shall pay or
cause to be paid (out of the proceeds of the Bonds or any other legally available funds
of the Seller) all expenses incident to the performance of the Seller's obligations
hereunder, including but not limited to the cost of printing, engraving and delivering
the Bonds to the Purchaser; the cost of preparation, printing (and/or word processing
and reproduction), of the Bond Ordinance; fees and disbursements of the Bond
Counsel, accountants and any other experts or consultants retained by the Seller in
connection with the Bonds; travel costs of the Seller; and any other expenses not
specifically enumerated in paragraph (b) of this Section incurred by the Seller in
connection with the issuance of the Bonds.
(b) Purchaser's Expenses
Whether or not the Bonds are delivered to the Purchaser as set forth herein, the Seller
shall be under no obligation to pay, and the Purchaser shall pay the costs of any "blue
sky" and legal investment memoranda; this Purchase Contract; the Purchaser's out-of-
pocket and travel expenses; the cost of preparation, printing (and/or word processing
and reproduction), distribution and delivery of the preliminary and final official
statements and all other expenses incurred by the Purchaser in connection with its
public offering and distribution of the Bonds not specifically enumerated in paragraph
(a) of this Section, including the fees and disbursements of its counsel, if any; and all
advertising expenses in connection with the public offering of the Bonds.
Section 5. Parties in Interest.
This Purchase Contract is made solely for the benefit of the Seller and the Purchaser (including
successors or assigns of the Purchaser) and no other person shall acquire or have any right
hereunder or by virtue hereof.
Section 6. Survival of Representations, Warranties, and Agreements; Liquidated
Damages.
The representations and warranties of the Seller, set forth in or made pursuant to this Purchase
Contract, shall not be deemed to have been discharged, satisfied or otherwise rendered void by
reason of the delivery of the Bonds or termination of this Purchase Contract and regardless of
any investigations or statements as to the results thereof made by or on behalf of the Purchaser
and regardless of delivery of and payment for the Bonds. Should the Purchaser fail (other than
for reasons permitted in this Purchase Contract) to pay for the Bonds on the Closing Date,
$7,298 (.5 % of the principal amount of the Bonds) shall be paid by the Purchaser to the Seller
as liquidated damages in full, and any expenses incurred shall be borne in accordance with
Section 4. Should the Seller fail to satisfy any of the foregoing conditions or covenants, or if
the Purchaser's obligations are terminated for any reason permitted under the Purchase
Contract, then neither Purchaser nor Seller shall have any further obligations under this
Purchase Contract, except that any expenses incurred shall be borne in accordance with the
Section 4.
Section 7. Notice.
Any written notice required by this Purchase Contract shall be sent to the Seller at its offices
located at 625 Winslow Way E., Bainbridge Island, Washington 98110 and to the Purchaser at
their offices located at 1201 3rd Avenue, Suite 2260, Seattle, Washington 98101, or at such
other locations as either party may direct.
Section 8. Effective Date.
This offer expires on the date set forth on Appendix A. This Purchase Contract shall become
effective and binding upon the respective parties hereto upon the execution of the acceptance
hereof by the Seller and shall be valid and enforceable as of the time of such acceptance.
Accepted by:
THE CITY OF BAINBRIDGE ISLAND, WASHINGTON
This 30th day of November, 1995
Title: 6d~
APPENDIX A
CITY OF BAINBRIDGE ISLAND, WASHINGTON
Terms
Dated Date:
December 15, 1995
Interest Payment Date:
December 15, 1996 and annually thereafter
Denomination:
Denominations of $5,000 except bond No. 1 in the
denomination of $4,653.
Optional Redemption:
Commencing on December 15, 1996 and each December 15,
thereafter, in numerical order, lowest numbers first at par plus
accrued interest whenever there is sufficient money in the Bond
Fund.
Purchase Price:
$1,411,645.01 plus accrued interest to delivery
Offer Expires:
November 30, 1995 @ 11:00 p.m.,P.S.T.
Closing Date:
December 18, 1995 @ 9:00 a.m., P.S.T.
Description:
$1,459,653 Bonds due December 15, 2007. The bonds shall
be at the interest rates for the aggregate amounts and bond
numbers as follows:
Amount Rate Number Amount Rate Number
$149,653 4.00% 1-30 $150,000 5.00% 153-182
155,000 4.25 31-61 150,000 5.10 183-212
150,000 4.45 62-91 150,000 5.20 213-242
155,000 4.65 92-122 150,000 5.30 243-272
150,000 4.85 123-152 100,000 5.40 273-292
Average Interest Rate = 5.02 %
Suggested Assessment Rate = 5.60 %
Underwriting Spread = 3.289%
TO:
FROM:
DATE:
RE:
BOND CLOSING STATEMENT
City of Bainbridge Island
$1,459,653
Local Improvement District No. 13. Bonds
Ralph Eells, Finance Director, City of Bainbridge Island
Lynn K. Nordby, City Administrator, City of Bainbridge Island
Jeff Fannon, Pacific Crest Securities
George Mack, Foster Pepper & Shefelman
Tom Glasl, Alex Brown
Mary McGrath, Pacific Crest Securities
Steve Gaidos, Vice President
Public Finance, Pacific Crest Securities
November 30, 1995
City of Bainbridge Island, Washington
$1,459,653 Local Improvement District No. 13
Closing December 18, 1995
The arrangement to have the Bonds printed and provide facsimile signatures is being handled
by Foster Pepper & Shefelman.
The Bond registrar will be provided with the list of registered owners by Pacific Crest
Securities or its agent four days prior to closing.
Closing is scheduled for December 18, 1995 at 9:00 A.M. PST at the offices of Foster Pepper
& Shefelman, 1111 3rd Avenue, Suite 3400, Seattle, Washington 98101
Par Value of Bonds
Less: Discount (3.289% of Par Value)
$ 1,459,653.00
48.007.99
Purchase Price (96.711% of Par Value)
Plus: Accrued interest to settlement
$ 1,411,645.01
583.59
Net Amount to the City
$ 1,412,228.60
Prior to settlement, Pacific Crest Securities will wire transfer $1,412,228.60 for payment of the
Bonds to:
American Marine Bank, Main
ABA #125104865
For the account of City of Bainbridge Islam
Account # 0907006001
(Credit of City of Bainbridge Island)