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ORD 2009-02 REFUNDING PLAN FOR LTGO 1998[execution e~"ionJ CITY ~' B~IN~~ID~~ ILA~TD, A~7I~T~N ~IN~E N~. X00-0~ ~ ~~DINA~I~ of the its of Bai~xb~"idge island, ashll~tan, rebating to cot~t~"a.ctltlg lndebte~nes; pro~iditl~ ~'o~ tae issuance of limited tax general obligation bonds and notes of tie City for general its pu~~oses to provide ~u1~d with which to ~a~ pad for a po1•~ion of the cast of ~ l~pg~"ade to the its' astev~~.ter t~~eat~rlent plant; fib} cam out a refi~nding plan with respect to the it's outstandl~lg L~.1ted Tax elleral ~~~Igatlon hands, 1998; and ~c~ pair costs of issuance of tic ba~~d; fixing certain terms and co~ellants of the bonds; and p~"o~i~i~lg for t~.e public sale of tk~e bolds or notes, ~asse~ 1Vlarch ~ 1, boo ~'1~~s oc~~~~~n~ ~~c~~ec~ ~y~ ~'os~er ,~epe~ I'LL ~ ~ ~ ~ T~i~c~ ~ ~e~~, S~~e 3400 ~~~~e, YYashinton ~ ~~ (20G) 447-4400 sa~~~~as.a ~~~~C1~~10~ ~~"1~11~ S~C~lOII ~. 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Fledge of Ta~ces ..................................................................................... ~......................,....... ~..~ 9 Se~LY~~~ 11, ~d[~1t1~~1~.~ ~~~d~~ a~~~~~al`~~s ~~1~1 ~~'~~I11.~~~F~~~a~~F~~a~~~ii~~~~~i~~s~~~~~~~~~~~~~F~i.~.~~~~~~~~..i.~a~~~~• ~V S~C~IUZ~ ~Af~ Fa~"~1 ~~ 1~~~~iuL~an V1 LVlllil3 ...............i~~.~~................~.............~..............~............1................ lk/ ectio~~ ~3, Band ei~trar .......................................................~..,..~.............,.......,........~....,.~,.....~...,,....... ~ 1 ,eC~lUll ~4. ~1c5~1'#atlan ~~Tax Exem~~lon ~a1 I~1~~~~5~..,......... ...........................,........~......,,,................. ~~ Sec~1Ql1 ~~, Deslgnatl4n 0~B411ds ~~ "~u~.~l~l~d ~~~-~eU1~J~ Bands" .................................~..,................ ~ 1 ~~~ ~ ~l ~ V ~ 1 \~ ~~ 11 {.i ~ ~ it ~1' ~ ~l ~ ~ ~ ~~~~ ~ 1 ~~~ ~ lIl l~ ~ ~ ~ , . ~ .. ~ , . ~ . ~ ..... ~ . ~ . ~ . ~ . ~ ....... s ~ ~ ~ i ~ ~ . ~ ~ .. a ~ . ~ ~ ~ . ~ ~ ~ . ~ ~ ~ . ~ ~ ~ , . ~ ~ ... ~ ~ ~ .. ~ ... ~ ~ ~ f.e Section 17. ~eb~ S~~~ie Funds and ~epasi~ of Bond Pracceds ............................................................... ~2 SCC~IOII ~~. Bo~.d Sale ~.eolution ............................................................................................................. 13 Sec~~o~l ~ l~efund~ng afFrlQt' Bands .F~~.~~r~~~~~F~~~.~~~~~~~~~i~~~~~i,,.,,i~~~~~~~~~r~,~~,~a„~~~~i„~~„„~,.~„~.~F.,,,~,~~~,..~~,,,~. ~J SeC~1011 ~~. Pt`ellnax~a~~ ~~~rc~a~ ta~~~~ae~t~} to ~~ Daen]ed Flna~,,,....,,..~F,~,.~~F~~..~~,...,.,,,..~F.~,,,,,,,,,,,,,,,,, ~~ ~c~xD~l ~~. ~On~lnUln~ ~1SClaSU1~ ...................................................................~...,..~,,..........................,..,. ~J SeCtXUYI ~~. ~~~~C~1~T~ ]date O~~~C~lnance........,.~.......,,.~F,,,.,~.~ .....................~..,..~F,,,,,~,.,,..,,,,..,,,,~.~.,.,.......... ~~ 50963348.4 ~~'~ 0~ B.~INB~IDE I~~N~, ''ASHINT RI~INANE N~. ~aa9~~~ ~N ~~l]II~A~'E off' the pity of Bainbridge Island, ashir~gton, relating to contracting indebtedness; providing far the issuance of limited tax general obligation bonds and notes off' the pity far general its put~oses to provide funds with hieh to ~a} pay for a portio~a of tlae cast of an upgrade to the pity's v~aste~vate~" treatment plant; ~b~ carry out a refunding plan with respect to the pity's autstar~dir~g Lirr~ited Tax eneral obligation Bonds, 1 ~~; and ~c~ pay costs of issuance of the bonds; fixing cet~tain terms and covenants of the bands; and providing far the public sale of the bonds or notes, THE CITY ~I~NIL ~F TAE ITS ~F BA~INBI~E IL1~D, AS~II~TOI~, D~ ~RDAI AS ~`DLL~TS; Section 1. Au~~a~r~~at~on, ~`~ndYn~s and Deterr~inati ns. ~'he pity council l~e~~eb~ rnl~es the findings and determinations set fot~th in this Section 1. capitalized tuns are defined in section ofthis ordinance, ~1} ~~c~~to~~za~io~. The 1t~ ouncxl finds and determines ~t to be in the bast lntarest of the pity to uthot~ize the issuance and sale of limited tax general obligation bonds in one or rr~are series, for the purposes of ~a~ cart"ying out the Project; fib} ca~~"yin out the Refunding Plan with respect to the refunding of all or a portion of the 1998 Bands; and {c} paying the costs of issuance of the Bonds. Depending on developing marl~et conditions, tlae pity p'inance Iirectat" is autho~"i~ed and directed to prepare for and conduct the sale of the Bonds authot"ized by this ordinance an a negotiated basis and, if necesa~"~, to obtain inter~~u financing such as lssuing anal selling one o~" more short-term band nticipat~an Hates} to be refinanced upon issuance of the Bonds, the tens of which sale shall be subject to approval by the pity council in one or mare Bond Sale lesalutions. The par ~naunt ofthe project Bonds shall not exceed ~7,1a,aaa. ~~} D~~ 'a~acity, The assessed valuation of the taxable property within the pity as ascertained by the last preceding assessment for pity purposes fay" taxes levied for collection in the calendar year X09 i ~,BI ,?S~, l 4. ~`he City has outsta~ading general indebtedness evidenced by limited tax general obligation bonds and capital leases in the principal an~aunt of 2Z,57,~15 incurred ~vitl~in the lirnit of up to 1 %°I~ oI' the value of the taxable property within the pity permitted far genes"al rr~unicipal purposes ~xtlnout vote of tl~e qualified voters. The pity leas unlimited tax general obligation bands in the principal amount of ~,S9a,aa0 incurred within the additional limit of up to ~'I~°I~ of the value of the taxable prape~-ty within the pity for parrs, open space and economic development purposes, issued pursuant to a vote of the qualified voters of the pity. ~~} 'atevo~s ~l~id~~y. The pity operates its atevarl~ Utility pursuant to ohpter 3.44 of the ~~ainbridge Island ~nioipal bode and chapters 35.7 and 35.92 ~. ~ pity ordinance No. 80-i4, the its formed its aterorl~s Utility b combining its thon-existing mater sstena and its sanitary sewage disposal sste~a, ~~ its ordinance No. ~~-27, rho its formed its storm and surface water drainage system and, ~~ ordinance No. 89-a combined it lnta the ~xttil~g 'U~aterarks Utility. BEM X3.44.010 provides that "~t]he city's unified v~aterarl~~ utxlxt~, ~r~1prlS~d of ltd at~r, sever and ~tOrrn and surface mater ~1lanage,e~t utilities, shall be accounted for as though those utilities mere separate funds." ~4} ~~~sta~di~ ~~td~~~edess ~'~ya~~ f~o~n ~]~ i~~t~ro~,s ~Tti~i~y. The pity presently h~.s no outstanding Revenue obligations has defined below}, which are payable sololy from the revenue of the ate~-~vor~s Utility. The its has pre~iousl~ issued subordinate obligations that are currently outstanding in the aggregate principal amount of $1,395,000 consisting of portions of the outstanding principal a~naunts of the pity' 1995, ~ 99S and 1999 Bonds, as shown to Exh~btt ~}, and are secured b subordinate pledge of ater~varl~s Utility Revenue in addition to a general obligation pledge 'The it presently has public ~rorl~s trust fund loans outstanding in the aggregate principal amount of '~,3~,~I I ,~~, which are payable from the revenues of the aterorks Utility on ~ basis subordinate to the lieu on the Net Revenue of the Tateot"l~s Utility with respect to Revenue ligatio~as cif any and with respect to the uborditaate obligations. ~} ~~an o~ f ~4~di~io~s. B~ ~rdinanoe No. ~~a4~~, the its up~~,ted its oornprehensive plan and has amended it by ordinance Nos. ZOOS-20, 2~0~-27, 2007-~~, 2007 1, 2~o7-3S, 2008-1~, 200$-21, 2008«22 and most recently bar 200$-0$, pissed by the ~it~ council on December 17, 2008. The pity's comprehensive plan, as amended, and the 2009 capital Facilities Plan Update, including the fix-dear capital lmpro~enaents Plan, species, adopts and orders the cart"ying out of a system ox" plan of addltlor~ to and betterments and extensions of the ''ater~ar~s Utility, i~eludi~ng the 1'ro~ect. In 2aa~, the its be~.n the upgrades, o~ which the Project is a part and is presentl~r in need of funds with which to complete the Project and to pay costs of issuance of the ittdebtcdness authorized far this purpose. arl~ on the Project was authorized on December 1 ~, 2007, a contract vas executed on February 12, 20~$, and the Notice to Proceed eras issued effective larch 11, 2008. The Project is currently expected to be corripleted in Pebruar~ 210. The estimated total costs of the Project to e paid during 2009 and 2010 is pproxirnatel~r $9,385,00, of which a portion lags been ot• will be paid from low-inter"est public works trust fund loans ot• other sources, and approximately $x,025,000 gill be paid franc the proceeds ofthe Project Botads autl~orizcd by this ordinance. ~} due ~a~. The pity council finds that it has exercised due regard far the Maintenance and operation Expense of the Taterorl~s Utility and may authorize the issuance off" limited tax general obligation bonds payable froth the Net Revetaue of the ater-~vorl~s Utility on a basis subordinate to payment of Maintenance and operation Expense and subordinate to the pity's payment obltgattons to cannectton nth the Revenue Obl~attons ~~f an~~ to htch such xe~enues are or nay in the Future be pledged. ~7} f~~tin ~f ~~ts~a~~in X998 ~~~~~ ~~ia~io ~ar~s. By ~rdinartce 98-54, the pity issued its Limited Tax General ~bligatiata Bonds, 1998, i~a the aggregate principal amount of X9,900,000, for the purposes of. ~a~ paying a portion of the cost of constructing a near so~~~~as,a 2 Cit~r fall; ~~} pa~'ing the cost of road construction v~ithin the City; ~c} purchasing open space property or development rights to maintain urban agriculture land; ~d} carrying aut a current refunding of the City's then-outstanding Limited Tai general obligations Bonds, 199; and ~e~ paling the costs of issuance of the bonds ~'he ~ 99 Bonds are presently outstanding in the aggregate principal an~aunt of ~,335,0~0, of which principal amount $1,75,000 consists of Subordinate obligations, asset forth in B~hibit B to this ordinance. ect~on ~, De~i~~I~ons, used in this ordinance, the following wards shall have the follov~ing meanings "1995 Bonds" means the Limited Tai General Obligation Bonds, 1998 of the City, issued pursuant to ordinance No. 98-5~, passed on Dece,ber 1 a, 1998, presently outstanding in the aggregate principal amount of ~~~,aaa, as identified in ~~hibit ~ to this ordinance. "Acquired ~b1i atg ions" means those ~Jnited states Treasury Certificates of Inde~ted~aes, Notes and Bonds -State and Local o~ern~nent series, and other direct, noncallab~e obligations of the I.Jnited States of Am.e~~ca purchased to accomplish the refunding of the refunded Bonds. "B~l1~C"means the Bainbridge lsiand ll~unicipal Code. "BOnd Le lslatlon" n7eans, for ~aCll s~~'l~s of fonds, tills ordinance and the relevant Bo11d Sale resolution. "Bald register" rr~eans the books or retards maintained by the Band registrar containing the name and mailing address of the owner of each Bond and the principal rrlaunt and number of Bands held by each owner. "Boni Rgit~ar" means the Fiscal Agent. "Bond Sale ~esolutian" means a resolution adapted by the City Council approving and ~"~xing the date, form, maturities, interest rates, terms and. covenants of the Indebtedness herein authar`lzed of each series of the Bonds and their sale. "Bands" means the Bands authorized by this ordinance, including any short«term Hates ar other obligations issued in anticipation of the issuance of the Bonds or any portion thereof. "C" means the City of Bainbridge Island, asllington, a rnunicipa.l corporation duly organized and existing under and by virtue of the laws of the state of ashingtan. "Cade" rr~eans the ~Jnited States Internal Revenue Code of 19~, s amended, anal applicable rules and regulations pran~ulgated thereunder "DT" means the Depository Tryst Con~pa.ny, Ne~v York, Ne~v Yank. "Debt service Fund" means the special fund c~•eated by this ordinance far the payment of the principal of and interest on any series of Bonds, as described in the relevant Bond dale resolution. sn~~~~~s.a 3 "Finance ~irectar" means the Director of Fin~.nce and Adnainistrati~e er~ices of the pity, "Fiscal Agent" means the fiscal agent of the state of Tashington, s the carne may be designated ~~ th.e state from time to time. "o~ernn~ent ~bli " has the meaning given xn chapter ~~ ~~, as it na~v exists or array hereafter ~ amended. "fetter of Representa~xons" means the Blanl~et Issuer Letter of Representations dated December ~ D; ~ 9, between the pity and. DTI, as it may be amended from time to time, ~`MRB'' means the Municipal securities Rule~nal~in Board. "Maintenance ~.n~~~eration expense" means all reasonable expenses incurred ~ tb.e pity in causing the ~Vaterorl~s Utility to be aperated and maintained in good repair, working arder and condition, including without limitation: payments bother than payments aut of proceeds of Future Parity Bonds into reasonable reser~res in any re~renue account of the ~ater~arl~s Utility far items of operating or maintenance expense t~.e payment of ~uhiah is nat in~rr~ediately required; payments of premiums ~'or insurance on tia.c ater~vorks Utility, payments a~ any state-imposed taxes; and payments with respect to any other expenses of the 'ateorl~s Utility th~.t are properly treated as Maintenance anal operation expense under generally accepted accounting principles applicable to municipal corporatian, The term Maintenance and operation expense does not include ~.~.~ depreciation ar capital additions ar capita.l replacements to the aterorl~s Utility or any taxes levied or in~pased by the pity or payments made ire lieu of taxes to the pity. The teen Maintenance and operation expense does include any payments made to any other mu~aicxpal corporation for mater ar v~ater service, or far sewage treatment a.nd disposal ser~~ce ~n the event the pity enters into a contract for such ser~vtces. "NI~MIR" means a nationally recagni~ed municipal securities information repasitary designated by the E in accordance with B Rule I5c2-l~~b}~}, "Net Revenue" means the aterarl~s Utility Revenue less Maintenance and operation ~xpense~ "Project" means the carrying out of ce~-ta~n addltlons and alterations to, and betterments and extensions of, the ateror~s Utility, consisting of the upgrades to the pity's ~vastev~ater treatment plant and related improvements, all as mare specifically described in exhibit . "Project Bo~ad'} means any series afi Bonds xssue~ pursuant to this ordinance and a Band dale Resolution to carry out the Project and to pay the costs associated with the issuance of the Project Bands. Fund. "Project Fund" means t~,e pity's previously created aste~vater Treatment Plant Project "Public marks Trust Fund Loans P able from atet~varks Utxiit Revenue " ar "PTF ~U~i~it~} Loam"means the outstanding loans set forth in exhibit A to this ordinance, anal SO4G3348.4 any future leans received from the state of Washington, or any departnnent ar agency thereof, payable fram and haying a lien an the Net Revenues hand ~L~D Assessments, if any} of the pity's waterworl~s ~Jtility that is junior to the Revenue ~bliatians and the Subordinate obligations. "Rating ency" means the nationally recognized rating agency ar agencies, if any, pra~iding a rating on the Bonds at the request of the pity. "Refunded Bands" means the ~ ~8 Bo~.ds included in the Refunding Plan and authorized to be refunded pursuant to this oxdin~.x~ce, subject to adoption of a Band Sale Resolution, "Refundin Bonds" means the limited tai geu,eral obligation Bonds issued pursuant to this ordinance f or the purpose of refunding all ox ~. portion of the refunded Bands. "Refundiu,g ~lan~" means the refunding of all or a pardon of the Refunded Bonds through the issuance of one or more series of Bands, all as mare particularl~r described in the Bond Sale Reno ut~on~ "Refundin Trust A ree~nenx" means a refunding trust or escrow agreement between. the pity and a Refunding Trustee, dated as of the closing date of such series, pz~a~iding far the safekeeping of certain Bond proceeds and the refunding of all or a portion of the Refunded Bonds, substantially in the farm attached to the Bond S~.le Resolution far the applicable series of Bonds. ~`Refundin Trustee" means for each series of Bonds issued for the put~pose of caxz~ying out a refunding, the ~`~n~ce Director, or the trustee or escrow agent, ar any successor trustee or escrow agent, designated by the Finance Director and appra~ed in the applicable Bond Sale Resolutxan. "Revenue ~bli ations" means any borrowing, whether issued preciously ar in the future, that has a lien that is p~~or and superior to any other lien an the Net Re~renues hand Uf,ZD Assessments, if any} of the pity's waterworks utility, including any obligations later issued on parity with the then~outstanding Re~renue obligations, "SEA"means the U~aited States Securities and ~~change o~nn~ission. "SSW" rnea~ns the storm and surface water management system, of the pity, operated as a component of the waterworks Utility. "subordinate ~bli ations" means any bort~owin, whether issued previously or in the future, that is payable from and has a lien on the Net Revenue hand UL~D Assessments, if any} that is subordinate to the lien with respect to the pity's Revenue obligations, but superior to ax~y Public worl~s Trust Fund ~,aans, and any obligations later issued on a parity with the then~outstanding Subordinate ~bliatians, Upon issuance of the Project Bonds, the outstanding Subordinate obligations will include the then~outstanding Subordinate obligations set fo~~b in ~~bibit A, the Project Bonds, and any future Subordinate obligations. ;~U~ID" means a utility local irnpro~ernent district. "ULII~ ~Assesn~ents" means all assess,ent levied and collected in a UL~D of the City reat~d fir the acaluls~t~on or construet~on Df add~tlons to and betterments aid extensions of the aterworl~s Utility if hand only iI} those assessments are pledged to be paid into the Debt Service Find, not including any prepaid aessnaents paid into a canstructia fund or account. UI~IU ~.ssessrrients shall include installments thereof and any interest or penalties thereon ~cat~~`w~~'l{5 Utlllt " maa~ the water, s~w~r, and 1VI systems of the City operated as ~ unified wterwarl~s utility pursuant to ordinance Nas. Sa-14 and 8-5~ of the City and chapter 3.44 of the Bainbridge Island Municipal Code, and all additions thereto and betterments and extensions thereof at any tine made. "waterworks Utxlit_.~nue" rrleans the grass re~rr~ue of the a.terwork Utility, including: all of the earnings and revenues received by the City fra the rr~aintnance and operation of the Taterworks Utility; ail earnings from the investment of money in any debt service end for any outstanding Revenue obligations; and ail connection and capital iprovon'lent cliat'ges collected for the purpose of defraying the costs of capital facilities of tl~e aterwarl~s Utility. The following are excluded from waterv~~oxl~s Utxllty Revenue; ULID 1~sessrnents; government grants; proceeds from the sate of aterwors Utility property; City taxes collected by or through the waterworks Utility; principal proceeds of bonds or other obligations and earnings ar proceeds from any investments in a trust, defeasance a~i escrow fund created to defense or refund waterworks Utility obligations {until commingled with other earnings and revenues of the aterworl~s Utility} or held in a special account far the purpose of paying a rebate to the United States overnn~ent under the Code; and earnings of a separate utility system that may be created by the City cif any}, Section . ~,uthoarl~ation of the Bons. The City shall borrow money on the credit of the City and issue negotiable limited tax general obligation bonds evidencing indebtedness to provide the funds far the purposes described 1n thzs Seet~on 3. The Bonds shalX be issued for general municipal purposes and maybe issued in any combination or as multiple separate series. Na Bonds may be issued and sold except pursuant to a Bond Sale les~lution approving the terms of such sale, The general indebtedness to be incurred shall be within the limit of up to 1 %°Io of the value of the taxable property within the City permitted for general municipal purposes without a vote of the qualified voters therein. The Bands are more specifically described as follows: ~a} The Project Bands shall be issued in an amount not to exceed 7,10,OD0 to pay ~ pot~tian of the costs of the Project and the costs associated with the issuance of the Pi'aject Bonds, including but not limited to all legal costs incurred in connection with the issuance of the Pra jest Bonds, Pursuant to ~, Bond Sale Resolution, the City Council may provide far the issuance and sale of bond anticipation notes or other short-term abligatians to provide interim financing, which interim financing is anticipated to be refinanced by the issuance of the Project Bands. fib} The Refunding Bonds shall be issued in an amount not to exceed that amount necessary to carry out a current refunding, to be set forth in a Refunding Phan, of that portion off' the then-outstanding 1 X98 Bonds including pang the administrative costs of ca~~~ying out the other elements of the Refunding Plank anal paying the costs of issuance of the Refunding Bonds. The ayar, pity ~.dminxstrator, ~irectar of Finance and Administrative services, pity Attorney, and other proper pity officials are authorized and directed to do everything necessary ~'or the issuance, sale and delivery of the Bonds subject to approval of tine te~~as of such Bonds its a Band Sale Resolutian}, Including w~thaut limitation taping such legal action a the pity A,ttarncy nay deem appropriate in connection with the issuance of the Bands, and far the proper application and use of the proceeds of the safe thereof. The actions he~"etofare tal~en in furtherance of and not inconsistent with the purposes of this arinr~ce are hereby ratified and ca~f ~r~ned. ect~an 4. Description of tie ~on~s. The Bonds shall be dated the date of their deli~cry to the initial purchaser; shall be issued in fully registered form; shall be in denominations of $5,~~~ or any integral multiple thereof within a single matur~ty~ shall be numbered separately, in the rnannar and with any additional designation a the Band Registrar deems necessary for purposes of identification; and shall contain such additional ternra.s as ~"e specified in the Bond Safe Resa~utior~, The Bonds shalX mature on the dates and in the amounts and boar interest payable on the dates and at the rates accepted by the qty auncil in the Band ale Resolution. The Bands shall be subject to optional ar mandatory rede~~nption, purchase or defeasance on the terms and at the tines speci~"~ed in the Band dale Resalutlon. All or sorr~e of the Bands may be designated s Term Bands, the principal of which is payable in mandatory rederr~ptian amounts prior to their stated rr~aturit, all as specified by the Bond dale Resolutia~a. The final maturity of any series of Bonds shall not extend beyond the reasonable life expectancy of the ipravem.ents financed by that series, and in no evert beyond ~a years after the issue date far that series. Section , ~e~istrtio~n ar~~ Transfer of ones, The Bands shall be issued only in registered form as to bath principal and interest and shall be ~"eco~"ded an the Bond Register. The Band Register shall contain the Warne and nailing address of the owner of each Band anal the principal amount anal number of each a~' the Bonds held by cacti owner. Bonds surrendered to the Band Registrar may be exchanged ~'or Ba~ads to any authorized dena.inatian of an equal aggregate principal amount and of the same interest rate and nnaturity. Bonds maybe transferred only if endorsed in the manner provided thereon and surrendered to the Band Registrar. Any exchange ar transfer shall be without cast to the owner or transferee. The Bond Registrar shall not be obligated to e~,chane or transfer any Band during the 15 days p~•ecedin any principal pay~lent or rederaptlan date, The Bonds initially shall be registered in the name of cede ~o., as the noninee of ~T, The Bands sa registered shall be held ~n fully in~r~obx~~zed fora by ~T a depository xn accordance V4Tlth the prav~s~ans ~~ the Letter of Representatlans. Neither the lty War the Band Registrar shall have any responsibility or obligation to DTI participants ar the persons for wham they act as r,on~inees with respect to the Bands regarding accuracy. of any records maintained by ~T ar DTI participants of any amount in respect of principal of a~• interest on the Bands, ar any notice which is permitted or required to be given to registered owners under the Bond f.eislatian except such notice as is required to be given by the Band Registrar" to ~T~, Far as fang as any Bonds are held in Bully immobilized form, DTI, its rron~inee ar its successor depositary shall e deemed to be the registered awner• far all purposes under the Band so~~~~~s.a 7 l~,egislation and all references to registered owners, bond owners, bondholders or the like shall mean DT or its nominee and, except for the purpose of the it's undert~.l~in, in. ~ connection with. the issuance of the Bonds, to provide continuing disclosure, shall not mean the owners of and ~ene~icial interests in the bands. Registered ownership of such Bonds, or and por~ians thereof, nay net thereafter be transferred except: ~i} to and successor of ~~ or its nominee, if that successor shah be qualified under any applicable laws to provide the services proposed to he provided b~ it; X11} to and substitute depas~tary a.ppo~nted by the pity or such substitute depository's successor; or viii} to any person if the Bonds are no longer held in in~xnobilized fora., [Jpon the resignation of DTI or its successor for any substitute depositary or its successors from its functions as depository, ax+ a determination b~ the pity that it na longer wishes to continue the system of boob entry transfers through l~T or its successor for any substitute depository ar its successor}, the pity nay appoint substitute depository. Any such substitute depository shall be qualif ic~l under ~.n applicable laws to provide the ser~iees proposed to be pra~vided by it. ~~ ~~~ ~~' ar ~t successor ~or substltute depository or its successor} reslgn from Its functions as depositary, and no substitute depositary can be obtained, ar iii} the it detet~rnine that the Bonds are to be in certificated faun, the ownership of Bonds ma.y be transferred to any person as provided herein and the Bands no longer shall be held in fully in~rnobilized farm Section P.aymen~ of B~n~s. Both principal of and interest on the Bonds shall be parable in lawful n~ona~ of the >~nited states of America., lnte~*est on the Bands shall be paid by checl~s or drafts of the Bond Registrar mailed on the interest payment date to the registered owners at the addresses appearing an the Band Register an the 15~h dad of the n~anth preceding the interact payment date ar, if requested in writing by a registered owner of $1,Oaa,aaa or mare in principai arr~aunt of Bands p~~iar to the applicable record date, by wire transfer on the Interest payment data. Principal of the Bands shall be payable upon pxasenttion a~ad surrender of the Bonds by the registered owners to the Bond Registrar, l~atwlthstanding the foregoing, for as long as the Bonds are registered in the name of DTI ar its nominee, payment of principal of and interest an the Bonds shall be made in the manner sat forth in the Letter of Representations, Section 7. ~edem tiara and ~r~rc~ase of Bonds, ~~,} ~~~io~a~ ,~ede~n~io~. All or some maturities of the Bonds nay be issued without the right or option of the pity to redeem thane Bands prier to their stated rnatu~~it~r dates, a designated in the maturity schedule set forth in the Band Sale Resolution. Except for those maturities so designated, the pity reserves the right and option to redeem the Bonds as ~. whole or in part within one or mare maturities selected by the pity and randomly within a maturity in such manner as the Band Registrar shall determine, at par plus accrued interest to the date fixed for redemption. fib} ~'e~m Bones, All ar some of the Bonds may be designated as Tern Bonds. ~f Terra Bonds arc redee~.ed under the optional redemption pro~isians, purchased by the pity in the open marl~et, or defeased, the par amount of the Term Bands so radeen~ad, purchased or defeased SQ9G334&.4 ~xrrespective of their vtual redemption or purchase prices shall be credited against one or more scheduled rriandatory redeinptian ainaunts for these Terms. Bo~ads. The pity shall determine the manner in which the credit is to be allocated and shall notify the Band registrar in ritxng of its allocation at least ~~ days prior to the earliest i~iandtary redemption date far that x~riaturity of Term Bands for which notice of redemption has not already been given portions of the principal ai~iaunt of any Bond, in installments of ,~Oa or any integral multiple thereaf, nay be redeerried. ~f less than all of the principal amount of any Band is ~edeerried, upon surrender of that Band to the Band eistrar, there shall be issued to the registered av~ner, without charge therefor, a ne~v Bond for Bonds, at the optiai~ of the registered owner} of the Barrie rriaturity ~.~. interest rate in. any of the denominations authorized by this ordinance in the aggregate principal amount remaining unredeemed. The pity further reserves the right aiad option to purchase any or all of the Bands in the open market at any time at any price acceptable to the pity plus accrued interest to the date of purchase, .ill Bonds purchased ar redeemed under this sectian shall be canceled, ot~ithstandin the foregoing, for as long ~ the Bonds are registered in the name of DTI or its norntnee, selection of Bonds four rcden~ption shall be in accordance v~ith the Letter of I~epreseiltatians 4 ~ct~on S. n~icc o~ ede~~~xo~a. The pity shall cause notice of any ir~tcnded reden~ptian of Bonds to be given not less than ~~ nor more than ~ days prior to the date fixed for redemption by first-class mail, postage prepaid, to the registered owner of any Band to be redeemed at the address appearing an the Band Register at the ti.e the Bond Registrar prepares the native, and the re~uii~er~ents of this sentence shall be deemed to have been fulfilled v~hen native has been rriailed as sa prodded, ~vlaether or nat it is actually received by the a~rner of any Bond, Interest on Bands ~a.llcd for 1•edei~nption shall cease to accrue on the date fixed far redemption unless the Baud or Bands valled are not redeemed when presented pursuant to the call. ~n addition, the redemption native shalt be rriailed v~ithin the carne period, pastage prepaid, to oody's investors ~rvice, Inc., to the Bond insurer cif any t its principal office for its successor}, to each ~I~IR or the 1VI~.B and to such other persons, including registered securities depositories ~xf a~,y}, and with such additional ~nfoi;iriatian as the Finance I~irectar shall deternine, but these additional rriailings shall not be a candltlon precedent to the redemption of Bonds, ~1ot~ithstandin the foregoing, for as long as the Bonds are registered in the narrle of 1~T ar its nominee, notice of ~•edernptxon shall be given in accordance i~Vith the Letter of Representations. e~iori 9. Fa~Iua~e to ~edccn~ Worlds. If any Band is not redeemed v~hcn properly presented at its maturity or call date, the pity shall be obligated to pay interest on that Bond at the same rate provided in the Band from and after its maturity or call date until that Band, both p~~ncipal and interest, is paid in full ar until sufficient money far its payment in full is on deposit in the applicable Debt service Fund and the Bond has been called far payn~ient by giving notice of that call to the registered o~rner of each of those unpaid Bands. ectao~ ~.~. ~~ed~e of Tapes. For a long as any of the Bands are outstanding, the pity irrevocably pledges to include in its budget and annually to levy taxes within the constitutional 5963345.4 and statutary tai li~nitatior~s provided by la~v ithaut a vote of the electors of the Cit y an all of the taxable praper~y within. the City in an amount sufficient, together with other money legally available and to be used therefor, to pay when due the principal of and interest on the Bonds, and. tl~e full faith, credit and resaurce of the City are pledged irrevocably for the annual levy and collection oftl~ose tapes and the prompt pyrr~ent of that principal and interest ectian 1 ~. ~~~itianl ~led~e of atervvar~s Ut~ii Revenue. For s long s any of the Project Bands are outstanding, the City further pledges to establish, rr~aintain and collect rates and charges for water, sever and drainage services that gill be adequate to produce ater~vorl~s Utility Revenue fully sufficient to provide, in the following order: ~a} far the Maintenance and operation l~xpense of the ater~rarks ~Jtillt~; ~b~ ~'or the punctual pa~rment of the ~rineipal of and interest an all autstndin Revenue obligations, if any, far which payment has riot ather~vise been provided and all amounts that the City is obligated to sat aside into a debt service fund and an~r resea~e fund securing such Revenue obligations, and all other payment obligations related thereto; ~c} far the punctual payment of the principal of and interest on all auttanding ~bo~~dinate ~bligatians, including the Project Bands, and far ail amaunts that the City is obligated to set aside in the Debt e~~rice Fund far such Pra jest Banals; and ~d} for the pa~~.o~.t of any and all other amounts that the City is obligated to pair from. Net Reve~aue of the ter~vorl~s Utility, i~.cludi~ag without limitation any Public arl~s 'rust Fund loans. CQnsistant with B1MC .4~~a1~, the City intends to relay the Project Bands authorised by this ordinance from revenues of the saver system and, in the event that revenues franc the water or NI systems a~•e required to be used for repayment of the Project Bonds} the City lntend to treat such use as an interfund loan that shall be repaid to the water ox systems. has applicable} by the surer system. ~'he Project Bonds shall be subordinate Bonds and the lien of the Project Bonds on Net Revenues of the aterwarl~s Utility is subordinate to payment of operating and Maintenance B~penses of the 'ater~vorl~s System anal to payment of principal of and interest an any Revenue obligations of the City to ~rhich such avenues are pledged, a.nd the City reserves the ~~ight to issue Revenue ~~ligations in the future on a lien superior to the lien with regard to the Subardinate obligations. ~'he City may additionally, in a Bond Sale Resolution, designate as Subordinate bligatian that portion of the Refunding Bands that is allacated to carrying out the refunding of the pot~tian of the Refunded Bands allocated to utility purposes, and nay n~alae an appropriate aalditional pledge of Net Revenues of the ate~-~rorl~s Utility to the indebtedness so designated. Section ~~. Farm and ~~ecution of Banals. The Bands shall be prepared in a form consistent with the provisions of` this ordinance and state law and shall be signed bar the Mayar and City Clerl~, either or both of ~vhase signatures nay ba manual or in facsimile, and the seal of the City or a facsimile reproduction thereof shall be impressed or printed thereon. only Bands bearing a Certif irate of A.~thentication, manually signed by the Bond Registrar, shall be valid ar obligatory for any purpose or entitled to the benefits of this ordinance, stating: "Th1s Bond is one of the fully reglstered C1ty of Bainbridge island, ~vashinton, ~~~ 0~' ~`.~.~.S ~Sj, described in ordinance No. ~D~~a~ and Resolution No. ." 'Phe authorised ig~~ing of a Certificate af' Authentication shall be cor~clui~ve evidence that the Band sa~~~~4s.~ ~ a so authenticated has been duly executed, authenticated anal delivered and is entitled to the beneffts of this ordinance. ~f any officex whose facsimile signature appears on the Bands ceases to be an officer of the pity authorised to sign bands before the Bands bearing his or her facsimile signature aye authenticated or delivered by the Band registrar or issued by the pity, those Bands nevertheless r~riay be authenticated, issued and delivered and, when authenticated, issued and delivered, shall be as binding on the pity as though that pexson lead centinued to be an officer of the pity autheri~ed to sign bonds. Any Bond also naay be signed on behalf of the pity ~~ ~ person who, on the actual date of signing of the Band, i an officer of the pity authorised to sign bands, although he or she did not hold the required office an the date ~~` issuance of the Bonds. ec~~ori 13. Boni, ,,Rei~rar. The Band ~.eistxar shall keep, or cause to be kept, sufficient books far the registration and transfer of the Bonds, which shall be open to inspectiar~ by the pity t all tunes, The Bond registrar is authorized, on behalf of the pity, to authenticate and deliver Bands txansferred or exchanged in accordance with the provisions of the Bonds and this ordinance, to serve as the pity's paying agent for the Bands and to carxy out all of the Band erstrar's powers and duties under this ordinance and pity ordinance fie. 83~ 1 D establishing a system of registration far the pity's bands and obligations. The Band eistxa.r shall be responsible far Its represntatiaris contained xri the Band ~egistrar~s erti~cate of Authentication Qri the Bands. The Band ~egistxar iay becorrie the owner of Bonds with the Barrie i~ht it mould have if it mere not the Band Registrar and, to the extent permitted by lam} nay act a depositary far and permit any of its officers or directors to act as members of, or in any athex capacity with respect to, any corrirriittee farmed to protect the rights of Bond o~rrier. eetion 14. Pr_e__ervat~on of Tax xcrn~tYOn for Intcres~. The 1ty covenants that it will take all actions necessary to prevent interest on the Bonds from being included in gross incanae far federal incorrie tax purposes, and it will neither take any action nor n~al~e or permit any use of proceeds of the Bands or other funds of the pity treated s proceeds of the Bonds at any time during the term of the Bands, which will cause interest on the Bonds to be included. in gross incorrie far' federal income tax purposes, The pity also covenants that it mill, to the extent the arbitrage rebate requirerrient in the bode is applicable to the Bonds, take all actiari necessary to comply {or to be treated as laving carnplied} v~rith that requiren~ant in connection with the Bonds, including the calculation and payment of any penalties that the City has elected to pay as an altei~riative to ca.lculatin rebatable arbitrage, and the payrrient of any other penalties if requlxed under ectrori 148 of the bode to prievent interest an the Bands from bcirr included in gross incarrie for federal income tax purposes. S~ct~on 1. Desl~natran of Bonds as "~ualr~e~,,,Ta~-,~~e„m~~ B~n~." The pity lies deterrriined and eertifes that ~a} the Bands are not "private activity bonds" within the rn.ea.ning of Section 141 ofthe bode; fib} the reasonably anticipated amount oftax-exempt obligations father than private activity bonds and other obligations not required to be included in such calculation} which the pity and any entity subordinate to the pity ~includi~g any entity that the pity centrals, that derives its authority to issue tax-exempt obligations fror~ri the pity, or that issues tax~exmpt ~~~~~~~$.~ 11 obligations an ~ beh~.lf of the pity} will issue during the calendar year i~ which the Bands ire issued will not exceed a,aaa;~00; arzd {} the acount aftax-exerr~pt obligations, including the Bonds, desiu,ated, ar deemed designated, by the pity as "qualified tax-exempt obligations" far the purposes of Section ~~{b}{~} of the bode during the calendar year i~. which the Bonds are issued does rat exceed 3a,00a,0aa, The pity designates, or deems designated, the Bonds s "qualified tai-exe~,pt obligations" for the purposes of Section 2~~{b}{3~ ofthe bode. ect~an 1G. ~efund~n or Defeasance of the Bonds. The City may issue refunding bands pursuant to the laws of the state of Washington or use money available from any other lawful source to pay when due the principal of and interest on the Bonds, or any portion thereof that is included in a refunding or defeasance plan, and to redeem and retire, refund or defease all such then-outstanding Bands {hereinaer collectively c~.1Xed the "defeased obligations"~ and to pay the casts of the refunding or defeasance~ ~f money andlor a~ernment ~bllations n~aturing at a tune or tines and bearing interest in amounts together with money, if necessary} sufficient to redeem and ~•etire, refund or defense the defeased obligations in accardar~ce with their terns are set aside in a special trust fund or escrow account xrre~rocab~y pledged to that redemption, retirement ar defeasance of defesed obligations ~here~nafter called the "trust account"}, then all right and interest of the owners of the defea.sed obligations in the eo~enants of this ordinance and in the funds and accounts obligated to the payment of the defeased obligations shall cease and became void. The owners of defeased obligations shall ha~re the right to receive payment of the principal of and interest an the defeased obligations from the trust account. The pity shall include in the refunding ar defeaance plan such pro~isior~s as the ~it~r deems necessary for the random selection of any defeased obligations that constitute less than all of a particular maturity of the Bands, far native of the defeasance to lac given to the owners ai` the defeased obligations and to such other persons as the pity sh~.ll determine, and for any required replacement of bond ce~~tif~cates for defeased obligations. The defeased Bands shall be deemed na longer outstanding and the pity may apply any ~naney in any other fund or account established for the payment or redemption of the defeased Bands to any lawful purposes as it shall determine. If the Bands are r~egistexed in the name of DT ar its nominee, notice of any defeasance of Bands shall be given to DTI in the manner prescribed in the setter of Representations far notices of redernptian of Bands, ectian ~7~ debt er~ice Funds and De~aosit of Bond ~~oceeds. The Bond dale Resolution shall pra~ide far the creation or designation of a Debt Service fund far the purpose of paying principal of and. interest on the Bonds All tapes collected far hand, as to any bands issued as subordinate obligations, the het Revenues allocated toy the payment of the principal of and interest an the Bonds shall be deposited into the Debt Service p'und~ The Bond Sale Resoiution shall further pra~ide foz- and direct the deposit afthe principal proceeds and premium, if an,y, xecived from the sale and delivery of the Bonds.Until needed to be used for the lOUrposes far which the Bands were issued and to pay costs of issuance of the Bonds, the principal proceeds may be ~n~ested ternporar~ly in any legal in~est~nent, and the investment earnings may be retained in the fund into which the proceeds are deposited and i~ay be spent for the purposes of that fund, except that eat~nins sub feet to a federal ta. or rebate requirornent may be withdrawn from the that food and used for those tai or rebate purposes. The proceeds of that portion of any series of Bands issued far refunding purposes shall be deposited and used in so~~~~as.a 12 ~.ccordance with the ~.pplicable Refunding Plan sat fot~th in the Bond dale Resolution and in acoordance v~ith Scotian ~ 9 of this ordinance. Scotian ~8. Banff ~e ~eso~ution, The Bands nay be issued only upon adoption by the pity Council of ~ Bond Sale Resolution providing fo~• the matters described in this ardinance, including the manner of sale and delivery of and payment for the Bands, the maturity dates of and interest rates ~ the Bo~.ds, and such other matters that the City Coun,ci~ deems necessary and appropriate to carxy aut the purposes of this ordinance, once adopted, the Band Sale Resolution shall be deemed a part of this ordinance ~~ if set forth herein. The Bond Sale Resolution nay provide for bond insurance, and may provide conditions or ca~vena.nts relating thereto, including additional ter~u, conditions, and. covenants relati~.g to the Bonds that are required by the bond insurer, and are consistent with the provisions of this ordinance, including but nit l~n~lted to restnctlans on lI]'~~St~,~nts and requ~ren~ents ~~ natlCe to aid consent ~~ tl~~ band insurer, The Mayor and the ~`in~.nc i]irectar are each separately authorized to execute and deliver, an behalf of the pity, any contracts and other documents consistent with the provisions of this ordinance far which the City's approval is necessary oz• to which the pity is a patty and that are related or incidental to the issuance and sale of the Bonds, ect~on~ ~9. ~ef~~nd~n~ of Prior hands. ~} ~~~~cired C'i~y ~'i~~ings ~~~~ .~s~ac~ ~o e~di. The isuanca and Sala of Bonds for the purpose of carr~ring out a Refunding Plan is authorized only if the City Council determines in the Bond dale Resolution that such issuance and sale i11 realise ~, n~intmurn savings to the pity of not less than threw percent, ~rhich is are authorised departure franc the City's debt policy. In ~nal~ing such finding and determination, the City council shall consider the fixed maturities of the refunding bands and the Refunded Bonds the costs of issuance and sale of the refunding bonds, and the l~no~n earned income from the investment of the proceeds of the issuance and sale of the refunding bonds and other n~aney of the City used in the Refunding Phan pending payment and redemption of the Refunded Bonds. In the Bond Sale Resolution, the City Council must further find and determine that ~i} the .aney to be deposited with the Refunding T~~ustee mill discharge and satisfy the obligations of the City with respect to the Refunded Bands under ~rdin~.n.cc Igo; -54 of the Cityy iii} that the pledges, charges, tz-usts, covenants, and agreements of the City made ar provided far in that ordinance as to th,e Refunded Bonds shall be discharged; and viii} that, immediately upon the i~~revocable deposit of such man~cy with the Refunding Trustee, the Refunded Bonds shall no longer be deemed to be outstanding under the ordinance that authorised the Refunded Bonds. fib} .~~a~ao~~~~er~~ ~f ~2er~nd~~ T'r~~~ee; ~4~~~o~~zatio~ fog .~i~~i~~ ~'ru~s~ ~reen~en~. The Band Sale Resolution shall describe the Refunding plan and provide f ar the appair~tn~ent of a Refunding Trustee, which nay be the Finance ~irectar ar an independent trustee, to carry out the Refunding Plan, rn connection with the issuance of refunding fonds, the ayar is authorised and directed to execute and deliver to the Refunding Trustee a Refunding Trust Agreement, substantially in the form approved in the Band Sale Resolution, which sets forth the duties, obligations anal responsibilities of the Refunding Trustee ~n connect~an with the pa~y~nent, redemption and retirement ofthe Refunded Bonds as provided in this ordinance and in the Bond Sale Resolutio~a, and stating that the provisions for payment of the fees, compensation and so~~~~as.a 13 expenses of such Refunding Trustee set fo~k~ therein are satisfactory to it. Prior to executing the Refunding Trust Agreement, th. Finance Director is autho~~zed to ~na1~e such changes ther`e~n which do not ch.ane the substance and purpose th.e~eol~ oar which assure that the escrow prodded th,exein and the refunding bonds axe in eornpl~ance with the requ~z~e~Bents of federal lam governing the exclusion of interest on the refunding bonds fra~n gross inearne far federal inco~.e tax purposes. ~c~ C'~~~ fog ea~etnp~io~ o ~nded ~~r~~. As a part of the lefunding flan, the pity nay in the Band ~.le Resolution call the Refunded Bonds far reden~ptian. Such call far redemption shall speci~'y the name of the bonds, the maturity dates, call dates and redemption prices expressed as a percentage of par, plus accrued interest}, and shall be i~rre~ocable after the delivery to the purchaser a~` the refunding hands. The dates on which the Refunded Bonds are called far redemption shall be, in the judgrr~ent of the Finance Director, the earliest practical dates an ~hicl~ those bonds nay be called for redemption. The Finance Director, pity Adrninistratar,ll~Iayor and other prope~i 1ty officials are authorized and d~xected to give or cause to be given such notices s re~uire~, at the times and in the manner required pursuant to the ordinance that authorized the Refunded Bands, in order to effort the defeasance and redernptioi~ prior to n~atu~-ity o f the Refunded Bands. {d~ ~']~e ~~nin ~'~an; Ise o .eu~~ ~o~d ~~`o~ee~s. T1~e Bond Sale Resolution s~.all pra~ide that, upon issuance of refunding bands, the proceeds of those hands allocated to carrying out a Refunding Plan together with other money of the pity, if necessary} in an amount sufficient to carry out th.e Refunding Flan shall, immediately upon receipt, be deposited with the Re~"unding Trustee. The Refunding Trustee shall use the inaney so deposited to discharge the obligations of the pity relating to the Refunded Bonds under ordinance N~a. ~-~~ by pra~idin foi~ the payment of the ainaunt ~equi~ed to be paid by the Refunding plan; The Refunding Plan shall be caiTied out, and proceeds of the Bonds shall be applied, in accordance with this ordinance, the Bond Sale Resolution and the lames a~` the State, ~e~ .~q~tsi~i~~ a~ ~~s~~t~~io~ o ~4cqu~~d ~~i~~~o~s. The adoption of the Bond Sale Resolution shall be authorization and direction to the Refunding Trustee to purchase the Acquired bligatians jai` substitute obligations} and to make the payments required to be made by the Refunding Phan ~'rorn the Acquired obligations for substitute obligations} and money deposited ~uit~. th,e Refunding Trustee pursuant to this ordinance and the Bond S~.le Resolution All Acquired ~bliatians for substitute obligations} and the money deposited with the Refunding Trustee and any incai~e earned on the amounts a deposited shall be held ixre~acbly, ingested anal applied in ccard~.nce with the provisions of the orda~aance that authorized the Refu~,ded Bundy, this ordin~.nce, the Bend Sale Resolution, chapter 9.~3 RCS' and other applicable st~.tutes of tl~e state of Washington, and floe refunding Trust Agreement. x.11 necessary and proper Fees, compensation and expenses of the Refunding Trustee and all other costs incidental to the setting up of the escrow to accan~plish the refunding of the Refunded Bonds and casts related to the issuance and delivery of the refunding bands, including bond printing, verificatiar~ fees, bond counsel's fees and other related expenses, .ay be paid out of the proceeds of floe refunding bonds, To the extent practicable, such obligations shall be discharged fully by the Refunding Trustee's simultaneous purchase of the Acquired obligations, bearing such interest and mtut~n as to principal and interest in such amounts and t such tunes so a to provide, together with a beginning cash balance, if necessary, for the payment a~ the amounts requii`ed to be paid by the Refunding Plan. The Acquired ~bligatian shall be listed and mare particularly descz~bed in schedule attached to the Refunding Trust Agreement, but are subject to substitution as set forth below. Prior to the purchase of any such Acquired obligations, the pity resew the right to substitute other o~ernn~ent ~bligatians far any of the Acquired ~bligatians and to use any sayings created thereby for any lawful pity purpose if ~i~ in the op~nian of Bond counsel, the interest an the ~~~ and the Refunded Bonds issued as tax- exen~pt obligations will remain excluded from gross income for federal income tax p~rpases under Sections ~ 0~, 148 and l ~~~~} of the bode, and ~~~} such substitution shall not ~rn,pa~r the tirrrely payment of tl~e amounts required to be paid ~~ the Refunding Plan, as ~eri~ied by a nationally recognised ~irrn of independent certified public accountants. After tl~e purchase of the Acquired bligatians by the Refunding Trustee, the pity reserves the r~lat to substitute therefor cash or a~ernent obligations subject to the conditions that such ~naney ar securities held by the Refunding Trustee shall be suf ~cier~t to carry out tb.e ~ef~nding Plan, that such, substitution will not cause the Bonds or the Refunded Bonds to be arbitrage bonds itlain the rr~eaning of Section 14 of the bode and regulations under such section of the bode in effect on the date of such substitution and applicable to obligations issued on the issue date of the Bards, and that the pity obtain: ~i~ verification ~ a nationally recagni~ed independent certified public accounting firm reasonably acceptable to the Refunding Trustee confirming that the payments of principal of and interest on the o~ernment obligations, if paid when due, and any other ~naney held by the Refunding Trustee mill be sufficient to carry out the Refunding Plan; and iii} an opinion from Band ou~asel to the effect that the disposition and substitution ar purchase of such securities, under the statutes, rules and regulations then in force and applicable to the Bands, mill not cause the interest on the Bonds or the Refunded Bonds issued as tax-exempt obligations to be included in grass income fog federal income tax purposes anal that such disposition and substitution ar purchase is in compliance with the statutes and regulations applicable to the Bo~ads, Any surplus n~aney resulting from the sale, transfer, other disposition or rederription of the Acquired obligations and the substitutions therefor shall be released from the t~~st estate and may be used for any lav~ful pity purpose, Section ~. Prel~m~n~ry_~~f~clX Statement~s),.~o,~c Deemed ~~~al. The pity council and pity staff has been provided with copies of draft Preliminary official Staterrient, pxepared in connection with the sale of the Bonds. Far the sole purpose of the Band purchaser's cornp~ianc v~ith Securities and Exchange am,issian Rule l 5c~-1 ~~b~~l}, the pity Finance Director i authari~ed to "deem final" the Prellmina~ry ~fclal Statement for, Statements if the Bonds are issued as separate series}, as of the date of each such Preliminary official State~ncnt, except far the omission ofinfor~nation as to offering prices, interest rates, selling corapensatian, aggregate principal arnaunt, principal amount per maturity, maturity dates, options of redemption, delivery dates, ratings and other terms of the Bonds dependent an such matters. Section ~ 1. ont~nu~n Disclosure. The pity shall unde~~ta~e to pra~ide for the ber~ef it of holders of the Bonds certain annual financial informatiar and operating data of the type included in the final official statement far thane Bands, a well as disclosure of cet~tain rnate~~il events respeCting the ~Onds, 1~] the manner and to ~~~ extent required ~~ ~Jn~ted States Securlt~es and Exchange arn~nissian Rule 15c~-12~b~~5}. The particular te~~rns of such undertl~ing shall be set fat~th in the Bond Sale Resolution ~~~~~~~$.~ 1 section ~~. Effective Date ~~ ~r~~nance. This erdina~ce shX~ take effect and be in force from aid aver xt passage aid f~~e days folio~uin its ~~b~xction a required by lam. P1~~~ by the pity ou~ci~ and ~PPR~"~~I~ ~~ the Mayor of the pity of ~xnr~de Ys~a~d, ah~~.gto~, at a regular open public n~eet~~g thereof, this ~ i ~~' day of March, 209. Mayor ATTEST: pity filer ~i'~~~~ AS T FOB; Foster Pepper PLLC, Bond ounsel so~s~~~s.~ ~ ~ ~~~B~T ~ ~ut~t~~d~~ ubar~~n~~~ ~b~iatrons 1999 Bands 1995 Bonds Utility Allae~tiar~~_ _ - - - ~Utillty ,~llocatann~~ 1995 Ba~d~ ~oa~ ~ 45,000 ~o,aaa ~ ~~~,oao X010 ~ 195,000 - 201 ~ - 200,000 - 20 ~ 2 21 o,oa~ - ~01 - ~ ~ ~,aao - 2D14 - ~S,aoo - 4,OQ0 1,075,UOU X75,000 '~ Authorized to be refunded pursuant to this ordinance. utst~nd~n ~T~ ~J~~~zty} Lois ~PyabZe ~~ro ~~xwar~ []ti~~t~ R~~enue}~ ll~at~~rity Ynterest ~utst~ndin P~~lncipat obligation ~~~~ ~t~te ~~~ of ~-1-~aa9~ PTF Utility} ~,oan # 004-691-PRE-107 2024 0,50°I~ 152,720.0 PTF Utility} Loan # 004-691-PRE-108 2024 050°Io 337,4~Q.~D 1'TF Utility} Loan # aa5~691-Oa1 202 0.50°Ia ~77,~~4.21 PTF ~CJtility) Loa1~ # 005-~91-002 2D25 x.50°Io 3,~~a,931.58 P~VTF Utility} Loa~~ # 06-X62-0,~.~~ 2a~ a~sa°Io ,~86,275.~2 ~ eeured by pledge of pity's fu11 faith and cxedit ire additio~a to ~ pledge of Net Re~enne of the ~Uater~vorlcs Utility, subordinate to bond obligations, except as noted. ~~ payable solely franc Net Revenues ofthe aterv~Qrl~s Utility. sa~~a~4s.~ ~ ~~~~~IT B ~ R~fun.d~~ ~o~d~ ~u~~tandr~ ~ir~~~ed T~ ~ener~ ~b~ia~iar~ Yn~prover~~~at end Refur~d~r~g Bor~~s,19S ~d~te~ ~]ecer~b~r x,1.998} Total ~ut~tarrding 1V~aturity.._ t~~ity A~l~acat~on pity fall Alla~atian ~~~znc~pa~ 2009 $ 20,000 $ 40,000 ~ 450,000 2010 15,000 450,000 X45,000 2011 20D,004 470,000 X70,000 201 ~ 2 ~ 0,000 490,000 740,000 201 2 ~ S,D00 S 10,000 725,040 2014 235,000 530,000 7G5,000 2015 555;000 555,000 201 ~ -~ 580,000 580}000 2017 - ~ 10,000 10,000 ~~ ~ ~ - ~Si~~~ ~~ ,~~~ Total ~}07~,OQa ~~~6a,4a4 C,~~5,004 sa~~~~~s,a ~ ~~~~~~T ~~a~ ofAddY~1~n~:'in~a ~~~v~ate~ Treatment ~~ant ~T~~ ~pg~r~e Project The ~nlo V~ate~r~ter Tr~~.t~nent Plant ~onsi~t of upgrades, ddit~an, ~betterent~ and ~X~enl~n rleCeSa~' ~~ n7.e~t a~h111t~n tie ~~~artTnent 0~ ~~1~~~ ~erl~lt e~~lllent ~~n11t~, ~~eli~~l~t~ and redundancy requirements, well ~ addre~ing noise and odor problern~, ~.~~ ~~ more pee1~ieatly decr~be~ ~n the ~~~ ~~ta~ Pcillties Plan update, adopted on ~eeerr~ber 18, X009, which is incorporated ~ t+eference herein. SO~b3348.~ ~RTIFI~I~l~ I, the undersigned, its clerk of the its of Bin~r~de Islands Washington the "xt"}, hereby cer~if~ as follov~r; I. The attached copy ~f ordinance N~o. 200-~ the "ordinance"} is full, true and coxreet copy of a~ ordinn.ce d~Xy passed at a regular eetin ~~ the pity council of the fit held at the regular meeting place thereof on ll~arch ~ 1, 2~~9, a~ ghat o~di~a~~e appe~.~~ o~n the minute book of the pity; and tho ~r~.inncc will he xr~ ui~ f'erce ~.n~ effect fire ~~.~ after ~uhlication in the pity's official newspaper, 2. ,~ quorum of the ~ne~nbe~• of the 1t o~ncil a present thro~ho~t the n~eetin~ and a n~a~or~ty of those n~en~ber present voted in the proper mariner for the passage of the ordinance. I~ ITI~~ `~IR~~~, I have ~icreunto set m~ hand this I I ~~' day of Il~arch, 209. CITY D~` BA,~N~~ZI~C~ I~~.,~, A.s~TNC~T~ ~'~~ it~r clerk Sfl9~i3348.4