ORD 2013-14 UTGO BOND REFINANCING51197070
CITY OF BAINBRIDGE ISLAND, WASHINGTON
ORDINANCE NO. 2013-14
AN ORDINANCE of the City of Bainbridge Island, Washington, relating
to contracting indebtedness; providing for the issuance, sale and delivery of not to
exceed $5,900,000 aggregate principal amount of unlimited tax general obligation
refunding bonds to provide funds necessary to carry out the refunding of certain
outstanding unlimited tax general obligation bonds of the City and to pay the
costs of issuance and sale of the bonds; fixing or setting parameters with respect
to certain terms and covenants of the bonds; appointing the City's designated
representative to approve the final terms of the sale of the bonds and to take
certain other actions with respect to carrying out the refundings and issuance of
the bonds; and providing for other related matters.
Passed June 26, 2013
This document prepared by:
Foster Pepper PLLC
1111 Third Avenue, Suite 3400
Seattle, Washington 981 OJ
(206) 447-4400
FORM 3 18 II
Section 1.
Section 2.
Section 3.
Section 4.
Section 5.
Section 6.
Section 7.
Section 8.
Section 9.
Section 10.
Section 11.
Section 12.
Section 13.
Section 14.
Section 15.
Section 16.
Section 17.
Section 18.
Section 19.
Section 20.
Exhibit A
Exhibit B
TABLE OF CONTENTS*
Definitions ............................................................................................................... 1
Findings and Determinations ................................................................................... 5
Authorization of Bonds ............................................................................................ 5
Description of the Bonds; Appointment of Designated Representative .................. 6
Bond Registrar; Registration and Transfer of Bonds .............................................. 6
Form and Execution of Bonds ................................................................................. 7
Payrnent of Bonds .................................................................................................... 8
Bond Fund ............................................................................................................... 8
Redemption Provisions and Purchase of Bonds ...................................................... 8
Failure To Pay Bonds .............................................................................................. 9
Pledge ofTaxes ........................................................................................................ 9
Tax Covenants; Designation of Bonds as "Qualified Tax-Exempt
Obligations." .......................................................................................................... 1 0
Refunding or Defeasance of the Bonds ................................................................. 1 0
Deposit of Bond Proceeds; Refunding of the Refunded Bonds ............................ 11
Sale and Delivery of the Bonds ............................................................................ .14
Official Statement; Continuing Disclosure ............................................................ 14
Supplemental and Amendatory Ordinances .......................................................... 14
General Authorization and Ratification ................................................................. l5
Severability ............................................................................................................ 15
Effective Date of Ordinance .................................................................................. 15
Parameters for Final Terms
Form of Undertaking to Provide Continuing Disclosure
*The cover page, table of contents and section headings of this ordinance are for convenience of reference only,
and shall not be used to resolve any question of interpretation of this ordinance.
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CITY OF BAINBRIDGE ISLAND, WASHINGTON
ORDINANCE NO. 2013-14
AN ORDINANCE of the City of Bainbridge Island, Washington, relating
to contracting indebtedness; providing for the issuance, sale and delivery of not to
exceed $5,900,000 aggregate principal amount of unlimited tax general obligation
refunding bonds to provide funds necessary to carry out the refunding of certain
outstanding unlimited tax general obligation bonds of the City and to pay the
costs of issuance and sale of the bonds; fixing or setting parameters with respect
to certain terms and covenants of the bonds; appointing the City's designated
representative to approve the final terms of the sale of the bonds and to take
certain other actions with respect to carrying out the refundings and issuance of
the bonds; and providing for other related matters.
THE CITY COUNCIL OF THE CITY OF BAINBRIDGE ISLAND, WASHINGTON,
DO ORDAIN AS FOLLOWS:
Section 1. Definitions. As used in this ordinance, the following capitalized terms
shall have the following meanings:
(a) "2002 Bond Ordinance" means Ordinance No. 2002-40 authorizing the issuance
of the 2002 Bonds.
(b) "2002 Bonds" means the Unlimited Tax General Obligation Bonds, 2002, issued
by the City pursuant to the 2002 Bond Ordinance.
(c) "2002 Refunded Bonds" means the 2002 Refunding Candidates selected by the
Designated Representative to be Refunded Bonds.
(d) "2002 Refimding Candidates" means the outstanding 2002 Bonds maturing in the
years 2013 through 2022, inclusive, the refunding of which has been provided for by this
ordinance.
(e) "2004 Bond Ordinance" means Ordinance No. 2004-15 authorizing the issuance
ofthe 2004 Bonds.
(f) "2004 Bonds" means the Unlimited Tax General Obligation Bonds, 2004, issued
by the City pursuant to the 2004 Bond Ordinance.
(g) "2004 Refunded Bonds" means the 2004 Refunding Candidates selected by the
Designated Representative to be Refunded Bonds.
(h) "2004 Refimding Candidates" means the outstanding 2004 Bonds maturing in the
years 2015 through 2023, inclusive, the refunding of which has been provided for by this
ordinance.
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(i) "Acquired Obligations" means those Government Obligations (as defined in the
applicable ordinance authorizing the Refunded Bonds) purchased to carry out the Refunding
Plan.
(j) "Authorized Denomination" means $5,000 or any integral multiple thereof within
a maturity of a Series.
(k) "Beneficial Owner" means, with respect to a Bond, the owner of any beneficial
interest in that Bond.
(I) "Bond'' means each bond issued pursuant to and for the purposes provided in this
ordinance.
(m) "Bond Counsel" means the firm of Foster Pepper PLLC, its successor, or any
other attorney or firm of attorneys selected by the City with a nationally recognized standing as
bond counsel in the field of municipal finance.
(n) "Bond Fund'' means the Unlimited Tax General Obligation Refunding Bond
Fund, 2013, of the City created for the payment of the principal of and interest on the Bonds.
( o) "Bond Purchase Agreement" means an offer to purchase a Series of the Bonds,
setting forth certain terms and conditions of the issuance, sale and delivery of those Bonds,
which offer is authorized to be accepted by the Designated Representative on behalf of the City,
if consistent with this ordinance.
(p) "Bond Register" means the books or records maintained by the Bond Registrar for
the purpose of identifying ownership of the each Bond.
( q) "Bond Registrar" means the Fiscal Agent, or any successor bond registrar
selected by the City.
(r) "City" means the City of Bainbridge Island, Washington, a municipal corporation
duly organized and existing under the laws of the State.
(s) "City Contribution" means legally available money of the City, in addition to
proceeds of the Bonds, necessary or advisable to accomplish the Refunding Plan, as determined
by the Designated Representative.
(t) "City Council" means the legislative authority of the City, as duly and regularly
constituted from time to time.
(u) "Code" means the United States Internal Revenue Code of 1986, as amended, and
applicable rules and regulations promulgated thereunder.
( v) "Designated Representative" means the officer of the City appointed in Section 4
of this ordinance to serve as the City's designated representative in accordance with
RCW 39.46.040(2).
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(w) "DTC" means The Depository Trust Company, New York. New York, or its
nommee.
(x) "Final Terms" means the terms and conditions for the sale of a Series of the
Bonds including the amount, date or dates, denominations, interest rate or rates (or mechanism
for determining interest rate or rates), payment dates, final maturity, redemption rights, price, and
other terms or covenants, including minimum savings for refunding bonds (if the refunding
bonds are issued for savings purposes).
(y) "Financial Advisor" means D.A. Davidson & Co., of Seattle, Washington, or any
other Financial Advisor then appointed and acting as financial advisor to the City.
(z) "Finance Officer" means the Director of Finance and Administrative Services or
such other officer of the City who succeeds to substantially all of the responsibilities of that
office.
(aa) "Fiscal Agent" means the fiscal agent of the State, as the same may be designated
by the State from time to time.
(bb) "Government Obligations" has the meaning given in RCW 39.53.010, as now in
effect or as may hereafter be amended.
( cc) "Issue Date" means, with respect to a Bond, the date of initial issuance and
delivery of that Bond to the Purchaser in exchange for the purchase price of that Bond.
( dd) "Letter of Representations" means the Blanket Issuer Letter of Representations
between the City and DTC, dated December 10, 1998.
(ee) "MSRB" means the Municipal Securities Rulemaking Board.
(ff) "Owner" means, without distinction, the Registered Owner and the Beneficial
Owner.
(gg) "Purchaser" means the corporation, firm, association, partnership, trust, or other
legal entity or group of entities selected by the Designated Representative to serve as underwriter
for a negotiated sale of any Series of the Bonds.
(hh) "Rating Agency" means any nationally recognized rating agency then maintaining
a rating on the Bonds at the request of the City.
(ii) "Record Date" means the Bond Registrar's close of business on the 15 111 day of
the month preceding an interest payment date. With respect to redemption of a Bond prior to its
maturity, the Record Date shall mean the Bond Registrar's close of business on the date on
which the Bond Registrar sends the notice of redemption in accordance with Section 9.
(jj) "Redemption Date" means, with respect to the 2002 Refunded Bonds, a date
selected by the Designated Representative that is not less than 30 days or more than 60 days after
the Issue Date, and with respect to the 2004 Refunded Bonds, December 1, 2014.
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(kk) "Rejimded Bonds" means all or a portion of the Refunding Candidates selected by
the Designated Representative to be refunded with the proceeds of a Series of the Bonds.
(11) "Refimded Bond Ordinances" means, together, the 2002 Bond Ordinance and the
2004 Bond Ordinance.
(mm) "Refunding Candidates" means, together, the 2002 Refunding Candidates and the
2004 Refunding Candidates.
(nn) "Refunding Plan" means (as further described in the applicable Refunding Trust
Agreement):
(i) the deposit with the Refunding Trustee of an amount of proceeds of a
Series of the Bonds sufficient (together with the City Contribution, if necessary) to acquire the
Acquired Obligations to be held by the Refunding Trustee with cash, if necessary;
(ii) the application of the principal of and interest on the Acquired Obligations
(and any other cash balance) to the payment of interest on the Refunded Bonds when due and the
call, payment and redemption of the specified Refunded Bonds on the applicable Redemption
Date at a price of par plus any accrued interest; and
(iii) the payment of costs of issuing the Series of the Bonds and the costs of
carrying out the foregoing elements of the Refunding Plan.
( oo) "Refunding Trust Agreement" means a refunding trust or escrow agreement
between the City and the Refunding Trustee, dated as of the Issue Date of each Series of the
Bonds, providing for the safekeeping of bond proceeds and the refunding certain Refunded
Bonds.
(pp) "Refunding Trustee" means U.S. Bank National Association serving as Refunding
Trustee or any successor thereto.
( qq) "Registered Owner" means, with respect to a Bond, the person in whose name
that Bond is registered on the Bond Register. For so long as the City utilizes the book-entry only
system for the Bonds under the Letter of Representations, Registered Owner shall mean the
Securities Depository.
(rr) "Rule I 5c2-I 2" means Rule 15c2-12 promulgated by the SEC under the
Securities Exchange Act of 1934, as amended.
(ss) "SEC" means the United States Securities and Exchange Commission.
(tt) "Securities Depository" means DTC, any successor thereto, any substitute
securities depository selected by the City that is qualified under applicable laws and regulations
to provide the services proposed to be provided by it, or the nominee of any of the foregoing.
(uu) "Series of the Bonds" or "Series" means a series of the Bonds issued pursuant to
this ordinance.
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(vv) "State" means the State of Washington.
(ww) "System of Registration" means the system of registration for the City's bonds and
other obligations set forth in Ordinance No. 83-10 ofthe City.
(xx) "Term Bond' means each Bond designated as a Term Bond and subject to
mandatory redemption in the years and amounts set forth in the Bond Purchase Agreement.
(yy) "Undertaking" means the undertaking to provide continuing disclosure entered
into pursuant to Section 16 of this ordinance.
Section 2. Findings and Determinations. The City takes note of the following facts
and makes the following findings and determinations:
(a) Issuance of the 2002 Bonds. Pursuant to the 2002 Bond Ordinance, the City
issued the 2002 Bonds for the purpose of acquiring forested areas, open space, wildlife habitat,
farms and agricultural lands and to create new trails and passive parks, and reserved the right to
redeem the 2002 Bonds maturing on and after December 1, 2013, prior to their maturity on or
after December 1, 2012, at a price equal to the stated principal amount outstanding plus accrued
interest to the date fixed for redemption. There are presently outstanding $3,285,000 principal
amount of 2002 Bonds maturing on December 1 of each of the years 2013 through 2022,
inclusive, and bearing various interest rates from 4.00% to 4.70%.
(b) Issuance of the 2004 Bonds. Pursuant to the 2004 Bond Ordinance, the City
issued the 2004 Bonds for the purpose of acquiring forested areas, open space, wildlife habitat,
farms and agricultural lands and to create new trails and passive parks, and reserved the right to
redeem the 2004 Bonds maturing on and after December 1, 2015, prior to their maturity on or
after December 1, 2014, at a price equal to the stated principal amount outstanding plus accrued
interest to the date fixed for redemption. There are presently outstanding $2,145,000 principal
amount of 2004 Bonds maturing on December 1 of each of the years 2015 through 2023,
inclusive, and bearing various interest rates from 4.00% to 4.65%.
(c) The Refundings. After due consideration, it appears to the City Council that all or
a portion of the Refunding Candidates may be refunded by the issuance and sale of the unlimited
tax general obligation refunding bonds authorized herein so that a savings will be effected by the
difference between the principal and interest cost over the life of the applicable Series of the
Bonds and the principal and interest cost over the life of the applicable Refunded Bonds but for
such refunding, which refunding will be effected by carrying out the Refunding Plan.
(d) The Bonds. For the purpose of providing the funds necessary to carry out the
Refunding Plan and to pay the costs of issuance and sale of the Bonds, the City Council finds
that it is in the best interests of the City and its taxpayers to issue and sell the Bonds to the
Purchaser, pursuant to the terms set forth in the Bond Purchase Agreement as approved by the
City's Designated Representative consistent with this ordinance.
Section 3. Authorization of Bonds. The City is authorized to borrow money on the
credit of the City and issue negotiable unlimited tax general obligation refunding bonds
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evidencing indebtedness in the amount of not to exceed $5,900,000 to provide funds necessary to
carry out the Refunding Plan and to pay the costs of issuance and sale of the Bonds.
Section 4. Description of the Bonds; Appointment of Designated Representative.
The City Manager and the Finance Officer are each appointed as the Designated Representative,
both with the individual authority to conduct the sale of the Bonds in the manner and upon the
terms deemed most advantageous to the City, and to approve the Final Terms of the Bonds, with
such additional terms and covenants as the Designated Representative deems advisable, within
the parameters set forth in Exhibit A, which is attached to this ordinance and incorporated by this
reference.
To the extent the principal amount of any Series of the Bonds exceeds the principal
amount of the Refunded Bonds being refunded within the parameters set forth in Exhibit A, such
excess shall constitute nonvoted general obligation debt of the City for purposes of calculating
debt capacity and shall be allocated, by the Designated Representative, to the earliest maturing
principal of the Bonds of such Series. The Designated Representative shall allocate the Series of
the Bonds to the corresponding Refunded Bonds in such manner as will comply with applicable
requirements of the Code, meet restrictions of State law concerning such refunding, and
effectuate any other allocation deemed necessary or advisable for accounting and debt
administration.
Section 5. Bond Registrar; Registration and Transfer of Bonds.
(a) Registration of Bonds. Each Bond shall be issued only in registered form as to
both principal and interest and the ownership of each Bond shall be recorded on the Bond
Register.
(b) Bond Registrar; Duties. The Fiscal Agent is appointed as initial Bond Registrar.
The Bond Registrar shall keep, or cause to be kept, 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 to carry out all of the Bond Registrar's powers and duties
under this ordinance and the System of Registration. The Bond Registrar shall be responsible for
its representations contained in the Bond Registrar's Certificate of Authentication on each Bond.
The Bond Registrar may become an Owner with the same rights it would have if it were not the
Bond Registrar and, to the extent permitted 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 Owners.
(c) Bond Register; Tramfer and Exchange. The Bond Register shall contain the
name and mailing address of each Registered Owner and the principal amount and number of
each Bond held by each Registered Owner. A Bond surrendered to the Bond Registrar may be
exchanged for a Bond or Bonds in any Authorized Denomination of an equal aggregate principal
amount and of the same Series, interest rate and maturity. A Bond may be transferred only if
endorsed in the manner provided thereon and surrendered to the Bond Registrar. Any exchange
or transfer shall be without cost to the Owner or transferee. The Bond Registrar shall not be
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obligated to exchange any Bond or transfer registered ownership during the period between the
applicable Record Date and the next upcoming interest payment or redemption date.
(d) Securities Depository; Book-Entry Only Form. DTC is appointed as initial
Securities Depository. Each Bond initially shall be registered in the name of Cede & Co., as the
nominee of DTC. Each Bond registered in the name of the Securities Depository shall be held
fully immobilized in book-entry only form by the Securities Depository in accordance with the
provisions of the Letter of Representations. Registered ownership of any Bond registered in the
name of the Securities Depository may not be transferred except: (i) to any successor Securities
Depository; (ii) to any substitute Securities Depository appointed by the City; or (iii) to any
person if the Bond is no longer to be held in book-entry only form. Upon the resignation of the
Securities Depository, or upon a termination of the services of the Securities Depository by the
City, the City may appoint a substitute Securities Depository. If (i) the Securities Depository
resigns and the City does not appoint a substitute Securities Depository, or (ii) the City
terminates the services of the Securities Depository, the Bonds no longer shall be held in book-
entry only form and the registered ownership of each Bond may be transferred to any person as
provided in this ordinance.
Neither the City nor the Bond Registrar shall have any obligation to participants of any
Securities Depository or the persons for whom they act as nominees regarding accuracy of any
records maintained by the Securities Depository or its participants. Neither the City nor the
Bond Registrar shall be responsible for any notice that is permitted or required to be given to a
Registered Owner except such notice as is required to be given by the Bond Registrar to the
Securities Depository.
Section 6. Form and Execution of Bonds.
(a) Form of Bonds,· Signatures and Seal. Each Bond shall be prepared in a form
consistent with the provisions of this ordinance and State law. Each Bond 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. If
any officer whose manual or facsimile signature appears on a Bond ceases to be an officer of the
City authorized to sign bonds before the Bond bearing his or her manual or facsimile signature is
authenticated by the Bond Registrar, or issued or delivered by the City, that Bond 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 bonds,
although he or she did not hold the required office on its Issue Date.
(b) Authentication. Only a Bond bearing a Certificate of Authentication 111
substantially 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: "Ce1iificate of
Authentication. This Bond is one of the fully registered City of Bainbridge Island, Washington,
Unlimited Tax General Obligation Refunding Bonds, 2013." 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.
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Section 7. Payment of Bonds. Principal of and interest on each Bond shall be
payable in lawful money of the United States of America. Principal of and interest on each Bond
registered in the name of the Securities Depository is payable in the manner set forth in the
Letter of Representations. Interest on each other Bond not registered in the name of the
Securities Depository is payable by electronic transfer on the interest payment date, or by check
or draft of the Bond Registrar mailed on the interest payment date to the Registered Owner at the
address appearing on the Bond Register on the Record Date. However, the City is not required
to make electronic transfers except pursuant to a request by a Registered Owner in writing
received on or prior to the Record Date and at the sole expense of the Registered Owner.
Principal of each other Bond not registered in the name of the Securities Depository is payable
upon presentation and surrender of the Bond by the Registered Owner to the Bond Registrar.
The Bonds are not subject to acceleration under any circumstances.
Section 8. Bond Fund. The Bond Fund is created as a special fund of the City for the
sole purpose of paying principal of and interest on the Bonds. Any Bond proceeds in excess of
the amounts needed to pay the costs of the Refunding Plan and the costs of issuance of the
Bonds, shall be deposited into the Bond Fund. All amounts allocated to the payment of the
principal of and interest on the Bonds shall be deposited in the Bond Fund as necessary for the
timely payment of amounts due with respect to the Bonds. The principal of and interest on the
Bonds shall be paid out of the Bond Fund. Until needed for that purpose, the City may invest
money in the Bond Fund temporarily in any legal investment, and the investment earnings shall
be retained in the Bond Fund and used for the purposes of that fund.
Section 9. Redemption Provisions and Purchase of Bonds.
(a) Optional Redemption. The Bonds shall be subject to redemption at the option of
the City on terms acceptable to the Designated Representative, as set forth in the Bond Purchase
Agreement, consistent with the parameters set forth in Exhibit A.
(b) Mandatory Redemption. Each Bond that is designated as a Term Bond in the
Bond Purchase Agreement, consistent with the parameters set forth in Exhibit A, if not
previously redeemed under any optional redemption provisions or purchased and surrendered for
cancellation under the provisions set forth below, shall be called for redemption at a price equal
to the stated principal amount to be redeemed, plus accrued interest, on the dates and in the
amounts as set forth in the Bond Purchase Agreement. If a Term Bond is redeemed under the
optional redemption provisions, defeased or purchased by the City and surrendered for
cancellation, the principal amount of the Term Bond so redeemed, defeased or purchased
(irrespective of its actual redemption or purchase prices) shall be credited against one or more
scheduled mandatory redemption installments for that Term Bond. The City shall determine the
manner in which the credit is to be allocated and shall notify the Bond Registrar in writing of its
allocation prior to the earliest mandatory redemption date for that Term Bond for which notice of
redemption has not already been given.
(c) Selection of Bonds for Redemption; Partial Redemption. If fewer than all of the
outstanding Bonds are to be redeemed at the option of the City, the City shall select the Series
and maturities to be redeemed. If fewer than all of the outstanding Bonds of a maturity of a
Series are to be redeemed, the Securities Depository shall select Bonds registered in the name of
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the Securities Depository to be redeemed in accordance with the Letter of Representations, and
the Bond Registrar shall select all other Bonds to be redeemed randomly in such manner as the
Bond Registrar shall determine. All or a portion of the principal amount of any Bond that is to
be redeemed may be redeemed in any Authorized Denomination. If less than all of the
outstanding principal amount of any Bond is redeemed, upon surrender of that Bond to the Bond
Registrar, there shall be issued to the Registered Owner, without charge, a new Bond (or Bonds,
at the option of the Registered Owner) of the same Series, maturity and interest rate in any
Authorized Denomination in the aggregate principal amount to remain outstanding.
(d) Notice o.fRedemption. Notice of redemption of each Bond registered in the name
of the Securities Depository shall be given in accordance with the Letter of Representations.
Notice of redemption of each other Bond, unless waived by the Registered Owner, shall be given
by the Bond Registrar not less than 20 nor more than 60 days prior to the date fixed for
redemption by first-class mail, postage prepaid, to the Registered Owner at the address appearing
on the Bond Register on the Record Date. The requirements of the preceding sentence shall be
satisfied when notice has been mailed as so provided, whether or not it is actually received by an
Owner. In addition, the redemption notice shall be mailed or sent electronically within the same
period to the MSRB (if required under the Undertaking), to each Rating Agency, and to such
other persons and with such additional information as the Finance Officer shall determine, but
these additional mailings shall not be a condition precedent to the redemption of any Bond.
(e) Rescission of Optional Redemption Notice. In the case of an optional redemption,
the notice of redemption may state that the City retains the right to rescind the redemption notice
and the redemption by giving a notice of rescission to the affected Registered Owners at any time
on or prior to the date fixed for redemption. Any notice of optional redemption that is so
rescinded shall be of no effect, and each Bond for which a notice of redemption has been
rescinded shall remain outstanding.
(f) Effect of Redemption. Interest on each Bond called for redemption shall cease to
accrue on the date fixed for redemption, unless either the notice of optional redemption is
rescinded as set forth above, or money sufficient to effect such redemption is not on deposit in
the Bond Fund or in a trust account established to refund or defease the Bond.
(g) Purchase o.f Bonds. The City reserves the right to purchase any or all of the
Bonds offered to the City at any time at any price acceptable to the City plus accrued interest to
the date of purchase.
Section 10. Failure To Pay Bonds. If the principal of any Bond is not paid when the
Bond is properly presented at its maturity date or date fixed for redemption, 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 date fixed for redemption 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, or in a trust
account established to refund or defease the Bond, and the Bond has been called for payment by
giving notice of that call to the Registered Owner.
Section 11. Pledge of Taxes. The Bonds constitute a general indebtedness of the City
and are payable from tax revenues of the City and such other money as is lawfully available and
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pledged by the City for the payment of principal of and interest on the Bonds. For as long as any
of the Bonds are outstanding, the City irrevocably pledges that it shall, in the manner provided
by law without limitation as to rate or amount, include in its annual property tax levy amounts
sufficient, together with other money that is lawfully available, to pay principal of and interest on
the Bonds as the same become due. The full faith, credit and resources of the City are pledged
irrevocably for the prompt payment of the principal of and interest on the Bonds and such pledge
shall be enforceable in mandamus against the City.
Section 12. Tax Covenants; Designation of Bonds as "Qualified Tax-Exempt
Obligations."
(a) 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 that
will cause interest on the Bonds to be included in gross income for federal income tax purposes.
The City also covenants that it will, to the extent the arbitrage rebate requirements of Section 148
of the Code are applicable to the Bonds, take all actions necessary to comply (or to be treated as
having complied) with those requirements in connection with the Bonds.
(b) Post-Issuance Compliance. The Finance Officer is authorized and directed to
adopt and implement the City's written procedures to facilitate compliance by the City with the
covenants in this ordinance and the applicable requirements of the Code that must be satisfied
after the Issue Date to prevent interest on the maintain the tax treatment of the Bonds and the
receipt of interest thereon.
(c) Designation ofBonds as "Qual(fied Tax-l!.xempt Obligations." The Designated
Representative may designate the Bonds as "qualified tax-exempt obligations" for the purposes
of Section 265(b )(3) of the Code, if the following conditions are met:
(i) the Bonds are not "private activity bonds" within the meamng of
Section 141 of the Code;
(ii) the reasonably anticipated amount of tax-exempt obligations (other than
private activity bonds and other obligations not required to be included in such calculation) that
the City and any entity subordinate to the City (including any entity that the City controls, that
derives its authority to issue tax-exempt obligations from the City, or that issues tax-exempt
obligations on behalf of the City) will issue during the calendar year in which the Bonds are
issued will not exceed $1 0,000,000; and
(iii) 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 issued does not exceed $10,000,000.
Section 13. Refunding or Defeasance of the Bonds. The City may issue refunding
bonds pursuant to State law or use money available from any other lawful source to carry out a
refunding or defeasance plan, which may include (a) paying when due the principal of and
interest on any or all of the Bonds (the "defeased Bonds"); (b) redeeming the defeased Bonds
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prior to their maturity; and (c) paying the costs of the refunding or defeasance. If the City sets
aside in a special trust fund or escrow account irrevocably pledged to that redemption or
defeasance (the "trust account"), money and/or Government Obligations maturing at a time or
times and bearing interest in amounts sufficient to redeem, refund or defease the defeased Bonds
in accordance with their terms, then all right and interest of the Owners of the defeased Bonds in
the covenants of this ordinance and in the funds and accounts obligated to the payment of the
defeased Bonds shall cease and become void. Thereafter, the Owners of defeased Bonds shall
have the right to receive payment of the principal of and interest on the defeased Bonds solely
from the trust account and the defeased Bonds shall be deemed no longer outstanding. In that
event, the City may apply money remaining in any fund or account (other than the trust account)
established for the payment or redemption of the defeased Bonds to any lawful purpose.
Unless otherwise specified by the City in a refunding or defeasance plan, notice of
refunding or defeasance shall be give, and selection of Bonds for any partial refunding or
defeasance shall be conducted, in the manner prescribed in this ordinance for the redemption of
Bonds.
Section 14. Deposit of Bond Proceeds; Refunding of the Refunded Bonds.
(a) Appointment of the Refimding Trustee. Pursuant to RCW 39.53.070, the
Refunding Trustee is hereby appointed to serve as trustee to oversee the safekeeping and
application of the Bond proceeds delivered to it.
(b) Selection of Refunded Bonds and Redemption Date. The Designated
Representative is authorized to select the Refunding Candidates to be refunded by each Series of
the Bonds. The Designated Representative may choose to refund fewer than all of the Refunding
Candidates. The Designated Representative shall select the Redemption Date for the 2002
Refunded Bonds. The Refunded Bonds and the Redemption Date for the 2002 Refunded Bonds,
as selected by the Designated Representative, shall be identified in the applicable Bond Purchase
Agreement and/or the applicable Refunding Trust Agreement.
(c) Deposit of Bond Proceeds; Purchase ofAcquired Obligations. Proceeds from the
sale of each Series of the Bonds in the amount sufficient to carrying out the applicable Refunding
Plan shall be deposited immediately upon the receipt thereof with the Refunding Trustee and
used to discharge the obligations of the City relating to the applicable Refunded Bonds under the
Refunded Bond Ordinances by providing for the payment of the amounts required to be paid by
the Refunding Plan. The Designated Representative is authorized for each Series of Bonds to
direct the Refunding Trustee to discharge such obligations by holding proceeds from the sale of
each Series of Bonds uninvested, or by the Refunding Trustee's simultaneous purchase of
Acquired Obligations, bearing such interest and maturing as to principal and interest in such
amounts and at such times so as to provide, together with a beginning cash balance, if necessary,
for the payment of the amounts required to be paid by the Refunding Plan. The Acquired
Obligations shall be listed and more particularly described in the Refunding Trust Agreement,
but are subject to substitution as set forth below. The Designated Representative is authorized
and directed to approve the Acquired Obligations to be purchased. The Finance Officer is
authorized to cause the City to transfer to the Refunding Trustee the City Contribution, if any,
immediately preceding the Issue Date. Any Bond proceeds or other money deposited with the
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Refunding Trustee not needed to carry out the Refunding Plan and pay the costs of issuing and
selling the Bonds shall be returned to the City as soon as reasonably practicable following the
Issue Date. Any Bond proceeds not needed to carry out the Refunding Plan and pay the costs of
issuance of the Bonds shall be deposited in the Bond Fund and used to pay interest on the
applicable Series of the Bonds on the first interest payment date.
(d) Substitution of Acquired Obligations. Prior to the purchase of any Acquired
Obligations, the City reserves the right to substitute other noncallable, nonprepayable direct
obligations of the United States of America ("Substitute Obligations") for any of such Acquired
Obligations if, (i) in the opinion of Bond Counsel the interest on the Bonds and the Refunded
Bonds will remain excluded from gross income for federal income tax purposes under Sections
103, 148 and 149( d) of the Code, and (ii) such substitution will not impair the timely payment of
the amounts required to be paid by the Refunding Plan, as verified by a nationally recognized
independent certified public accounting firm. The City may use any savings created by the
foregoing substitution to pay interest on the Bonds on the first interest payment date.
After the purchase of Acquired Obligations by the Refunding Trustee, the City reserves
the right to substitute therefor money and/or Substitute Obligations subject to the conditions that
such money or Substitute Obligations held by the Refunding Trustee will be sufficient to carry
out the Refunding Plan, that such substitution will not cause the Bonds and the Refunded Bonds
to be arbitrage bonds within the meaning of Section 148 of the Code and regulations thereunder
in effect on the date of such substitution and applicable to obligations issued on the Issue Date,
and that the City obtains, at its expense: (i) a verification by a nationally recognized independent
certified public accounting firm confirming that the payments of principal of and interest on the
Substitute Obligations, if paid when due, and any other money held by the Refunding Trustee
will be sufficient to carry out the Refunding Plan; and (ii) an opinion from Bond Counsel to the
effect that the disposition and substitution or purchase of such Substitute Obligations, under the
statutes, rules and regulations then in force and applicable to the Bonds or the Refunded Bonds,
will not cause the interest on the Bonds or the Refunded Bonds to be included in gross income
for federal income tax purposes and that such disposition and substitution or purchase is in
compliance with the statutes and regulations applicable to the Bonds or the Refunded Bonds.
Any surplus money resulting from the sale, transfer, other disposition or redemption of the
Acquired Obligations and the substitutions therefor shall be released from the trust estate and
transferred to the City to be used to pay debt service on the Bonds.
(e) Administration of Refimding Plan. The Refunding Trustee is authorized and
directed to purchase the Acquired Obligations (or Substitute Obligations) and to make the
payments required to be made pursuant to the Refunding Plan from the Acquired Obligations (or
Substitute Obligations) and money deposited with the Refunding Trustee pursuant to this
ordinance and the Refunding Plan. All Acquired Obligations (or Substitute Obligations) and
money deposited with the Refunding Trustee and any income therefrom shall be held
irrevocably, invested and applied in accordance with the provisions of the Refunded Bond
Ordinances, this ordinance, chapter 39.53 RCW and other applicable laws of the State and the
Refunding Trust Agreement. All necessary and proper fees, compensation and expenses of the
Refunding Trustee and all other costs incidental to the setting up of the escrow to accomplish the
Refunding Plan and costs related to the issuance, sale and delivery of the Bonds, including bond
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printing, rating service fees, verification fees, Bond Counsel's fees and other related expenses.
shall be paid out of the proceeds of the Bonds.
(f) Authorizationfor Re.fimding Trust Agreement. To carry out the Refunding Plan,
the Designated Representative is authorized and directed to execute and deliver to the Refunding
Trustee the Refunding Trust Agreement setting forth the duties, obligations and responsibilities
of the Refunding Trustee in connection with the payment, redemption and retirement of the
Refunded Bonds as provided herein and stating that the provisions for payment of the fees,
compensation and expenses of the Refunding Trustee set forth therein are satisfactory to it.
(g) Call for Redemption of the Refunded Bonds. Effective upon the Issue Date, the
City calls for redemption all of the Refunded Bonds on the applicable Redemption Date, at a
price equal to the stated principal amount outstanding plus interest accrued to the Redemption
Date. The call for redemption shall be irrevocable after the delivery of the Bonds to the
Purchaser. The date on which the 2002 Refunded Bonds are herein called for redemption shall
be the first date after the Issue Date, as determined by the Designated Representative, on which it
is practicable to redeem the Refunded Bonds pursuant to the 2002 Bond Ordinance. The date on
which the 2004 Refunded Bonds are herein called for redemption is the first date on which the
Refunded Bonds may be called. The Refunding Trustee is authorized and directed to give or
cause to be given such notices as required, at the times and in the manner required, pursuant to
the Refunded Bond Ordinances and the Refunding Trust Agreement in order to effect the
redemption of the Refunded Bonds prior to their stated maturity dates.
(h) Additional Findings. Prior to the execution of any Bond Purchase Agreement, the
Designated Representative must determine, on behalf of the City, that the issuance, sale and
delivery of that particular Series of the Bonds will effect a net present value savings to the City
and its taxpayers as set forth in paragraph (i)(3) of Appendix A attached hereto. The City
Council finds and determines that such net present value savings is a substantial savings and that
achieving such net present value savings by issuing Bonds is in the best interest of the City and
in the public interest. In making the finding and determination that the issuance, sale and
delivery of a Series of the Bonds will effect the foregoing net present value savings, the
Designated Representative shall give consideration to the fixed maturities of the Bonds of that
Series and the Refunded Bonds to be refunded by such Series, the costs related to the issuance,
sale and delivery of such Series and the known earned income from the investment of the
proceeds of the issuance and sale of such Series and the City Contribution, if any, used in the
Refunding Plan pending payment and redemption of the Refunded Bonds to be redeemed.
The Designated Representative further must find and determine that the money to be
deposited with the Refunding Trustee to carry out the Refunding Plan will discharge and satisfy
the obligations of the City under the Refunded Bond Ordinances with respect to the Refunded
Bonds, and the pledges, charges, trusts, covenants and agreements of the City therein made or
provided for as to the Refunded Bonds, and that the Refunded Bonds shall no longer be deemed
to be outstanding under the Refunded Bond Ordinances immediately upon the deposit of such
money with the Refunding Trustee.
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Section 15. Sale and Delivery of the Bonds.
(a) Sale of Bonds. The Designated Representative shall negotiate the sale of the
Bonds pursuant to a Bond Purchase Agreement for each Series of the Bonds setting forth the
Final Terms. The Designated Representative is authorized to execute the Bond Purchase
Agreement on behalf of the City, so long as the terms provided therein are consistent with the
terms ofthis ordinance.
(b) Preparation, Execution and Delivery of the Bonds. The Bonds will be prepared at
City expense and will be delivered to the Purchaser in accordance with the Bond Purchase
Agreement, together with the approving legal opinion of Bond Counsel regarding the Bonds.
Section 16. Official Statement; Continuing Disclosure.
(a) Preliminary Official Statement Deemed Final. The Designated Representative
shall review the form of the preliminary official statement prepared in connection with each sale
of a Series of the Bonds to the public. For the sole purpose of the Purchaser's compliance with
paragraph (b )(1) of Rule 15c2-12, the Designated Representative is authorized to deem that
preliminary official statement final as of its date, except for the omission of information
permitted to be omitted by Rule 15c2-12. The City approves the distribution to potential
purchasers of the Bonds of a preliminary official statement that has been deemed final in
accordance with this subsection.
(b) Approval of Final Official Statement. The City approves the preparation of a final
official statement for each Series of the Bonds to be sold to the public in the form of the
preliminary official statement, with such modifications and amendments as the Designated
Representative deems necessary or desirable, and further authorizes the Designated
Representative to execute and deliver such final official statement to the Purchaser. The City
authorizes and approves the distribution by the Purchaser of that final official statement to
purchasers and potential purchasers of the Bonds.
(c) Undertaking to Provide Continuing Disclosure. To meet the requirements of
paragraph (b)( 5) of Rule 15c2-12, as applicable to a participating underwriter for the Bonds, the
Designated Representative is authorized to execute a written undertaking to provide continuing
disclosure for the benefit ofholders of the Bonds in substantially the form attached as Exhibit B.
Section 17. Supplemental and Amendatory Ordinances. The City may supplement or
amend this ordinance for any one or more of the following purposes without the consent of any
Owners ofthe Bonds:
(a) To add covenants and agreements that do not materially adversely affect the
interests of Owners, or to surrender any right or power reserved to or conferred upon the City.
(b) To cure any ambiguities, or to cure, correct or supplement any defective provision
contained in this ordinance in a manner that does not materially adversely affect the interest of
the Beneficial Owners of the Bonds.
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Section 18. General Authorization and Ratification. The Designated Representative
and other appropriate officers of the City are severally authorized to take such actions and to
execute such documents as in their judgment may be necessary or desirable to carry out the
transactions contemplated in connection with this ordinance, and to do everything necessary for
the prompt delivery of the Bonds to the Purchaser and for the proper application, use and
investment of the proceeds of the Bonds. All actions taken prior to the effective date of this
ordinance in furtherance of the purposes described in this ordinance and not inconsistent with the
terms of this ordinance are ratified and confirmed in all respects.
Section 19. Severability. The provisions of this ordinance are declared to be separate
and severable. If a comi of competent jurisdiction, all appeals having been exhausted or all
appeal periods having run, finds any provision of this ordinance to be invalid or unenforceable as
to any person or circumstance, such offending provision shall, if feasible, be deemed to be
modified to be within the limits of enforceability or validity. However, if the offending
provision cannot be so modified, it shall be null and void with respect to the particular person or
circumstance, and all other provisions of this ordinance in all other respects, and the offending
provision with respect to all other persons and all other circumstances, shall remain valid and
enforceable.
Section 20. Effective Date of Ordinance. This ordinance shall take effect and be in
force from and after its passage and five days following its publication as required by law.
PASSED by the City Council and APPROVED by the Mayor of the City of Bainbridge
Island, Washington, at an open public meeting thereof, this 26th day of June, 2013.
0
Steven Bonkowski, Mayor
ATTEST:
APPROVED AS TO FORM:
Bo~
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Exhibit A
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PARAMETERS FOR FINAL TERMS OF THE BONDS
(a) Principal Amount.
(b) Date or Dates.
(c) Denominations, Name, etc.
(d) Interest Rates.
(e) Payment Dates.
(f) Final Maturity.
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The Bonds may be issued in one or more Series and shall
not exceed the aggregate principal amount of $5,900,000.
The principal amount of any Series of the Bonds (i) may
exceed the principal amount of the Refunded Bonds being
refunded by an amount deemed reasonably required to
effect the Refunding Plan pertaining to such Series of the
Bonds, or (ii) may be equal to or less than the principal
amount of the Refunded Bonds being refunded, so long as
the proceeds of any Series of the Bonds (together with the
City Contribution, if any) are sufficient to effect the
Refunding Plan pertaining to such Series of the Bonds.
Each Bond shall be dated the Issue Date, which date may
not be later than December 31, 2014.
The Bonds shall be issued in Authorized Denominations
and shall be numbered separately in the manner and shall
bear any name and additional designation as deemed
necessary or appropriate by the Designated Representative.
Each Bond shall bear interest at a fixed rate per annum
(computed on the basis of a 3 60-day year of twelve 3 0-day
months) from the Issue Date or from the most recent date
for which interest has been paid or duly provided for,
whichever is later. One or more rates of interest may be
fixed for the Bonds. No rate of interest for any Bond may
exceed 5.50%, and the true interest cost to the City for each
Series ofthe Bonds may not exceed 2.75%.
Interest shall be payable at fixed rates semiannually on
dates acceptable to the Designated Representative,
commencing no later than one year following the Issue
Date. Principal payments shall commence on a date
acceptable to the Designated Representative and shall be
payable at maturity or in mandatory redemption
installments on dates acceptable to the Designated
Representative.
The Bonds allocated to refunding the 2002 Refunded
Bonds shall mature no later than December 1, 2022 and the
Bonds allocated to refunding the 2004 Refunded Bonds
shall mature no later than December 1, 2023.
A-1
(g) Redemption Rights.
;!
(h) Price.
(i) Annual Debt Service
(i) Other Terms and Conditions.
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The Designated Representative may approve in the Bond
Purchase Agreement provisions for the optional and
mandatory redemption of Bonds, subject to the following:
(1) Optional Redemption. Any Bond may be designated as
being (A) subject to redemption at the option of the
City prior to its maturity date on the dates and at the
prices set forth in the Bond Purchase Agreement; or (B)
not subject to redemption prior to its maturity date. If a
Bond is subject to optional redemption prior to its
maturity, it must be subject to such redemption on one
or more dates occurring not more than 1012 years after
the Issue Date.
(2) Mandatory Redemption. Any Bond may be designated
as a Term Bond, subject to mandatory redemption prior
to its maturity on the dates and in the amounts set forth
in the Bond Purchase Agreement.
The purchase price for each Series of the Bonds may not be
less than 98% or more than 125% of the stated principal
amount of that Series.
The aggregate annual principal and interest payments on
each Series of the Bonds shall not exceed the respective
annual principal and interest requirements of the applicable
Refunded Bonds in a manner that is not consistent with
RCW 39.53.090.
(1) A Series of the Bonds may not be issued if it would
cause the indebtedness of the City to exceed the City's
legal debt capacity on the Issue Date.
(2) The Designated Representative may determine whether
it is in the City's best interest to provide for bond
insurance or other credit enhancement; and may accept
such additional terms, conditions and covenants as he
or she may determine are in the best interests of the
City, consistent with this ordinance.
(3) Each Series of the Bonds shall produce a minimum net
present value savings to the City and its taxpayers of
5.0% (as a percentage of the Refunded Bonds refunded
by such Series). Net present value savings means the
aggregate difference between (i) annual debt service on
the Refunded Bonds to be refunded, less (ii) annual
debt service on the corresponding Series of the Bonds
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(including expenses related to costs of issuance of that
Series of the Bonds) discounted to the Issue Date using
the yield on that Series of the Bonds as the discount
rate, plus (iii) excess cash, if any, distributed to the City
on the Issue Date, and less (iv) the amount of the City
Contribution, if any, made on such Issue Date.
A-3
[Form of]
UNDERTAKING TO PROVIDE CONTINUING DISCLOSURE
City of Bainbridge Island, Washington
Unlimited Tax General Obligation Refunding Bonds, 2013
Exhibit B
To meet the requirements of paragraph (b )(5) of Rule 15c2-12, as applicable to a
participating underwriter for the above-referenced bonds (the "Bonds"), the City makes the
following written Undertaking for the benefit of holders of the Bonds:
(a) Undertaking to Provide Annual Financial Information and Notice of Listed
Events. The City undertakes to provide or cause to be provided, either directly or through a
designated agent, to the MSRB, in an electronic format as prescribed by the MSRB,
accompanied by identifying information as prescribed by the MSRB:
(i) Annual financial information and operating data of the type included in the final
official statement for the Bonds and described in paragraph (b) ("annual financial
information");
(ii) Timely notice (not in excess of 10 business days after the occurrence of the event)
of the occurrence of any of the following events with respect to the Bonds:
(1) principal and interest payment delinquencies; (2) non-payment related
defaults, if material; (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, the issuance by the Internal Revenue
Service of proposed or final determinations of taxability, Notice of Proposed Issue
(IRS Form 5701 -TEB) or other material notices or determinations with respect
to the tax status of the Bonds; (7) modifications to rights of holders of the Bonds,
if material; (8) bond calls (other than scheduled mandatory redemptions of Term
Bonds), if material, and tender offers; (9) defeasances; (1 0) release, substitution,
or sale of property securing repayment of the Bonds, if material; (11) rating
changes; (12) bankruptcy, insolvency, receivership or similar event of the City, as
such "Bankruptcy Events" are defined in Rule 15c2-12; (13) the consummation of
a merger, consolidation, or acquisition involving the City or the sale of all or
substantially all of the assets of the City other than in the ordinary course of
business, the entry into a definitive agreement to undertake such an action or the
termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and (14) appointment of a successor or
additional trustee or the change of name of a trustee, if material.
(iii) Timely notice of a failure by the City to provide required annual financial
information on or before the date specified in paragraph (b).
(b) Type of Annual Financial Information Undertaken to be Provided. The annual
financial information that the City undertakes to provide in paragraph (a):
B-1
51197070
(i) Shall consist of (1) annual financial statements prepared (except as noted in the
financial statements) in accordance with generally accepted accounting principles
applicable to local governmental units of the State such as the City, as such
principles may be changed from time to time, which statements may be unaudited,
provided, that if and when audited financial statements are prepared and available
they will be provided; (2) principal amount of general obligation indebtedness
outstanding at the end of the applicable fiscal year; (3) assessed valuation for that
fiscal year; and ( 4) ad valorem property tax levy amounts and rates for that fiscal
year;
(ii) Shall be provided 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, 2013; and
(iii) May be provided in a single or multiple documents, and may be incorporated by
specific reference to documents available to the public on the Internet website of
the MSRB or filed with the SEC.
(c) Amendment of Undertaking. This 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 or the MSRB,
under the circumstances and in the manner permitted by Rule 15c2-12. The City will give notice
to the MSRB 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 information to be provided, the annual financial information containing the amended
financial information will include a narrative explanation of the effect of that change on the type
of information to be provided.
(d) Beneficiaries. This Unde1iaking shall inure to the benefit of the City and the
holder of each Bond, 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 the provisions of Rule 15c2-12 that require the City to comply
with this Undertaking become legally inapplicable in respect of the Bonds for any reason, as
confirmed by an opinion of Bond Counsel delivered to the City, and the City provides timely
notice of such termination to the MSRB.
(f) Remedy for Failure to Comply with Undertaking. As soon as practicable after the
City learns of any failure to comply with this 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 this Undertaking shall constitute a default in respect of the Bonds. The
sole remedy of any holder of a Bond shall be to take action to compel the City or other obligated
person to comply with this Undertaking, including seeking an order of specific performance from
an appropriate court.
B-2
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(g) Designation of Official Responsible to Administer Undertaking. The Finance
Officer or his or her designee is authorized to take such further actions as may be necessary,
appropriate or convenient to carry out this Undertaking in accordance with Rule 15c2-12,
including the following actions:
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(i) Preparing and filing the annual financial information undertaken to be provided;
(ii) Determining whether any event specified in paragraph (a) has occurred, assessing
its materiality, where necessary, with respect to the Bonds, and preparing and
disseminating any required notice of its occurrence;
(iii) Determining whether any person other than the City is an "obligated person"
within the meaning of Rule 15c2-12 with respect to the Bonds, and obtaining
from such person an undertaking to provide any annual financial information and
notice of listed events for that person required under Rule 15c2-12;
(iv) Selecting, engaging and compensating designated agents and consultants,
including financial advisors and legal counsel, to assist and advise the City in
carrying out this Undertaking; and
(v) Effecting any necessary amendment ofthis Undertaking.
B-3
CERTIFICATION
I, the undersigned, City Clerk of the City of Bainbridge Island, Washington (the "City"),
hereby certify as follows:
1. The attached copy of Ordinance No. 2013-14 (the "Ordinance") is a full, true and
correct copy of an ordinance duly passed at a regular meeting of the City Council of the City
held at the regular meeting place thereof on June 26, 2013, as that ordinance appears on the
minute book ofthe City.
2. The Ordinance will be in full force and effect five days after publication in the City's
official newspaper, which publication date is June 28, 2013.
3. A quorum of the members of the City Council was present throughout the meeting
and a majority of the members voted in the proper manner for the passage of the Ordinance.
Dated: June 26, 2013.
51197070
CITY OF BAINBRIDGE ISLAND,
WASHINGTON
Rosalind D. Lassoff, City Jerk