ORD NO. 2019-22 PROVIDING FOR THE ISSUANCE OF NO-TO-EXCEED 11,500.00 IN LTGO BONDSCITY OF BAINBRIDGE ISLAND, WASHINGTON
ORDINANCE NO. 2019-22
AN ORDINANCE of the City of Bainbridge Island, Washington,
providing for the issuance of not to exceed $11,500,000 aggregate principal
amount of limited tax general obligation and refunding bonds to finance a portion
of the construction of a public safety and municipal court facility and to refund
certain outstanding limited tax general obligation bonds of the City; 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 providing for other related matters.
Passed October 1, 2019
This document prepared by:
Foster Pepper PLLC
1111 Third Avenue, Suite 3000
Seattle, Washington 98101
(206) 447-4400
53487509.5
TABLE OF CONTENTS*
Page
Section1 . Definitions...............................................................................................................1
Section 2 .
Findings and Determinations...................................................................................4
Section 3 .
Authorization of Bonds............................................................................................6
Section 4.
Description of the Bonds; Appointment of Designated Representative ..................6
Section 5 .
Bond Registrar; Registration and Transfer of Bonds..............................................6
Section 6.
Form and Execution of Bonds.................................................................................7
Section7.
Payment of Bonds....................................................................................................8
Section 8 .
Funds and Accounts; Deposit of Proceeds..............................................................8
Section 9 .
Redemption Provisions and Purchase of Bonds......................................................9
Section 10.
Failure To Pay Bonds.. ..........................................................................................
10
Section11 .
Pledge of Taxes......................................................................................................10
Section 12 .
Tax Covenants; Designation of Bonds as "Qualified Tax Exempt
Obligations."..........................................................................................................10
Section 13 .
Refunding or Defeasance of the Bonds.................................................................11
Section 14 .
Use of Proceeds of the Bonds................................................................................12
Section 15 .
Refunding of the Refunded Bonds........................................................................12
Section 16 .
Call for Redemption of the Refunded Bonds........................................................13
Section 17 .
Findings with Respect to Refunding......................................................................14
Section 18 .
Sale and Delivery of the Bonds.............................................................................14
Section 19 .
Official Statement; Continuing Disclosure............................................................14
Section 20.
Supplemental and Amendatory Ordinances..........................................................15
Section 21 .
General Authorization and Ratification.................................................................15
Section22 .
Severability............................................................................................................15
Section 23 .
Effective Date of Ordinance..................................................................................16
Exhibit A Parameters for Final Terms
Exhibit B 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.
534875095
CITY OF BAINBRIDGE ISLAND, WASHINGTON
ORDINANCE NO. 2019-22
AN ORDINANCE of the City of Bainbridge Island, Washington,
providing for the issuance of not to exceed $11,500,000 aggregate principal
amount of limited tax general obligation and refunding bonds to finance a portion
of the construction of a public safety and municipal court facility and to refund
certain outstanding limited tax general obligation bonds of the City; 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 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) "Acquired Obligations" means those United States Treasury Certificates of
Indebtedness, Notes, and Bonds --State and Local Government Series and other direct, noncallable
obligations of the United States of America purchased to accomplish the refunding of the Refunded
Bonds as authorized by this ordinance.
(b) "Authorized Denomination" means $5,000 or any integral multiple thereof within
a maturity of a Series.
(c) "Beneficial Owner" means, with respect to a Bond, the owner of any beneficial
interest in that Bond.
(d) "Bond' means each bond issued pursuant to and for the purposes provided in this
ordinance.
(e) "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.
(f) "Bond Fund" means the Limited Tax General Obligation and Refunding Bond
Fund, 2019, of the City created for the payment of the principal of and interest on the Bonds.
(g) "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.
(h) "Bond Register" means the books or records maintained by the Bond Registrar for
the purpose of identifying ownership of each Bond.
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(i) "Bond Registrar" means the Fiscal Agent, or any successor bond registrar selected
by the City.
0) "City" means the City of Bainbridge Island, Washington, a municipal corporation
duly organized and existing under the laws of the State.
(k) "City Council" means the legislative authority of the City, as duly and regularly
constituted from time to time.
(1) "Code" means the United States Internal Revenue Code of 1986, as amended, and
applicable rules and regulations promulgated thereunder.
(m) "DTC" means The Depository Trust Company, New York, New York, or its
nominee.
(n) "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).
(o) "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).
(p) "Fiscal Agent" means the fiscal agent of the State, as the same may be designated
by the State from time to time.
(q) "Government Obligations" has the meaning given in RCW 39.53.010, as now in
effect or as may hereafter be amended.
(r) "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.
(s) "Letter of Representations" means the Blanket Issuer Letter of Representations
between the City and DTC, dated December 10, 1998, as it may be amended from time to time,
and any successor or substitute letter relating to the operational procedures of the Securities
Depository.
(,t) "MSRB" means the Municipal Securities Rulemaking Board.
(u) "Official Statement" means an offering document, disclosure document, private
placement memorandum or substantially similar disclosure document provided to purchasers and
potential purchasers in connection with the initial offering of a Series of the Bonds in conformance
with Rule 15c2-12 or other applicable regulations of the SEC.
(v) "Owner" means, without distinction, the Registered Owner and the Beneficial
Owner.
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(w) "Pricing Certificate" means the certificate of a Designated Representative with the
Final Terms of the Bonds.
(x) "Project" means construction of a public safety and municipal court facility, and
other capital purposes, as deemed necessary and advisable by the City. Incidental costs incurred
in connection with carrying out and accomplishing the Project, consistent with RCW 39.46.070,
may be included as costs of the Project. The Project includes acquisition, construction and
installation of all necessary furniture, equipment, apparatus, accessories, fixtures and
appurtenances.
(y) "Project Fund" means the fund or account designated or created by the Director of
Finance and Administrative Services for the purpose of depositing Bond proceeds to carry out the
Project.
(z) "Purchaser" means Piper Jaffray & Co, or such other corporation, firm, association,
partnership, trust, bank, financial institution or other legal entity or group of entities selected by
the Designated Representative to serve as purchaser in a private placement or underwriter in a
negotiated sale of any Series of the Bonds.
(aa) "Rating Agency" means any nationally recognized rating agency then maintaining
a rating on the Bonds at the request of the City.
(bb) "Record Date" means the Bond Registrar's close of business on the 15th 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.
(cc) "Refunded Bonds" means all or a portion of the Refunding Candidates selected by
the Designated Representative to be refunded with proceeds of a Series of the Bonds and included
in a Refunding Plan.
(dd) "Refunding Candidates" means the outstanding 2007 Bonds maturing in the years
2021, 2023, 2025 and 2027, and the outstanding 2008 Bonds maturing in the years 2024 and 2028,
the refundings of which has been provided for by this ordinance.
(ee) "Refunding Plan" means:
(1) the placement of sufficient proceeds of a Series of the Bonds which, with
other money of the City, if necessary, will acquire the Acquired Obligations to be deposited, with
cash, if necessary, with the Refunding Trustee;
(2) the payment of the principal of and interest on the Refunded Bonds when
due up to and including such date or dates as determined by the Designated Representative, and
the call, payment, and redemption on such date or dates, of all of the then -outstanding Refunded
Bonds at a price of par; and
(3) may include the payment of the costs of issuing a Series of the Bonds and
the costs of carrying out the foregoing elements of the Refunding Plan.
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(ff) "Refunding Trust Agreement" means a Refunding Trust Agreement between the
City and the Refunding Trustee.
(gg) "Refunding Trustee" means U.S. Bank National Association of Seattle,
Washington, or any successor trustee or escrow agent serving as refunding trustee to carry out the
Refunding Plan.
(hh) "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.
(ii) "Rule 15c2-12" means Rule 15c2-12 promulgated by the SEC under the Securities
Exchange Act of 1934, as amended.
0j) "SEC" means the United States Securities and Exchange Commission.
(kk) "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.
(11) "Series of the Bonds" or "Series" means a series of the Bonds issued pursuant to
this ordinance.
(mm) "State" means the State of Washington.
(nn) "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.
(oo) "2007 Bonds" means the Limited Tax General Obligation Bonds, 2007 of the City,
issued pursuant to Ordinance No. 2007-42.
(pp) "2008 Bonds" means the Limited Tax General Obligation Bonds, 2008 of the City,
issued pursuant to Ordinance No. 2008-25.
(qq) "Undertaking" means the undertaking to provide continuing disclosure entered into
pursuant to Section 19 of this ordinance.
Section 2. Findings and Determinations. The City takes note of the following facts
and makes the following findings and determinations:
(a) Authority and Description of Project. The City is in need of a public safety and
municipal court facility. The total expected cost of the Project is approximately $20,000,000. The
City Council therefore finds that it is in the best interests of the City to carry out the Project.
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(b) Authority and Description of the Refunding Plan.
(1) Pursuant to Ordinance No. 2007-42, the City issued its $4,120,000 par value
Limited Tax General Obligation Bonds, 2007 (the "2007 Bonds"), for the purpose of paying or
reimbursing the City for the purchase of certain open space properties and financing streetscape,
street and parking related improvements, and by that ordinance reserved the right to redeem the
2007 Bonds maturing on and after December 1, 2019, prior to their maturity on or after
December 1, 2017, at price of par plus accrued interest to the date fixed for redemption (the "2007
Refunding Candidates").
(2) There are presently $2,045,000 par value of 2007 Refunding Candidates
outstanding.
(3) Pursuant to Ordinance No. 2008-25, the City issued its $1,770,000 par value
Limited Tax General Obligation Bonds, 2008 (the "2008 Bonds"), for the purpose of financing or
reimbursing the City for a portion of the cost of various capital projects included in the City's 2008
capital facilities plan, and by that ordinance reserved the right to redeem the 2008 Bonds maturing
on and after June 1, 2024, prior to their maturity on or after June 1, 2018, at price of par plus
accrued interest to the date fixed for redemption (the "2008 Refunding Candidates," and together
with 2007 Refunding Candidates, the "Refunding Candidates").
(4) There are presently $985,000 par value of 2008 Refunding Candidates
outstanding.
(5) After due consideration, it appears to the City Council that all or a portion
of the Refunding Candidates may be refunded by a portion of the issuance and sale of the limited
tax general obligation and 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 portion of the Bonds used
for the Refunding Plan and the principal and interest cost over the life of the Refunded Bonds but
for such refunding, which refunding will be effected by carrying out the Refunding Plan.
(c) Debt Capacity. The maximum amount of indebtedness authorized by this
ordinance is $11,500,000. Based on the following facts, this amount is to be issued within the
amount permitted to be issued by the City for general municipal purposes without a vote:
(1) The assessed valuation of the taxable property within the City as ascertained
by the last preceding assessment for City purposes for collection in the calendar year 2019 is
$8,406,309,515.
(2) As of June 30, 2019, the City had limited tax general obligation
indebtedness, consisting of bonds and loans outstanding in the principal amount of $7,262,983,
which is incurred within the limit of up to 1 V2% of the value of the taxable property within the City
permitted for general municipal purposes without a vote.
(3) As of June 30, 2019, the City had unlimited tax general obligation
indebtedness for capital purposes only outstanding in the principal amount of $2,760,000 for
acquiring or developing open space, park facilities, and capital facilities associated with economic
development. The indebtedness described in this paragraph has been incurred with the approval
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of the requisite proportion of the City's qualified voters at an election meeting the minimum
turnout requirements, within the limit of up to 2%2% of the value of the taxable property within the
City for general municipal purposes (when combined with the outstanding limited tax general
obligation indebtedness), 21/2% for utility purposes and 21/2% for open space, parks and economic
development purposes.
(d) The Bonds. For the purpose of providing the funds necessary to finance the Project,
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, 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 limited tax general obligation and refunding bonds
evidencing indebtedness in one or more Series in the aggregate principal amount not to exceed
$11,500,000 to provide funds necessary to finance the Project, carry out the Refunding Plan and
pay the costs of issuance and sale of the Bonds. The proceeds of the Bonds allocated to paying
the cost of the Project shall be deposited as set forth in Section 8(b) of this ordinance and shall be
used to carry out the Project, or a portion of the Project, in such order of time as the City determines
is advisable and practicable. The proceeds of the Bonds allocated to paying the cost of the
Refunding Plan shall be deposited as set forth in Sections 14 and 15 of this ordinance and shall be
used to carry out the Refunding Plan.
Section 4. Description of the Bonds, Appointment of Designated Representative. The
City Manager, Deputy City Manager and the Director of Finance and Administrative Services are
each appointed as the Designated Representative of the City and are authorized and directed 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 each Series 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.
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 if
the Bonds are sold by public sale. 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. 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
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to act as members of, or in any other capacity with respect to, any committee formed to protect the
rights of Owners.
If the Bonds are sold by private placement, the Designated Representative may select the
Bond Registrar and set forth the registration procedures in the Pricing Certificate.
(c) Bond Register; Transfer 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 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. If a Bond is to be issued in book -
entry form, DTC shall be appointed as initial Securities Depository and each such 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
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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 in
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: "Certificate of
Authentication. This Bond is one of the fully registered City of Bainbridge Island, Washington,
Limited Tax General Obligation [Refunding] Bonds, 2019, described in the Bond Ordinance."
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.
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 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 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. Funds and Accounts Deposit of Proceeds.
(a) Bond Fund. The Bond Fund is created as a special fund of the City for the sole
purpose of paying principal of and interest and any redemption premium on the Bonds. Bond
proceeds in excess of the amounts needed to pay the costs of the Project and the Refunding Plan
and the costs of issuance, if any, 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.
(b) Project Fund. The Project Fund is a fund of the City to be used for the purpose of
paying the costs of the Project. Proceeds received from the sale and delivery of the Bonds to be
used for the Project shall be deposited into the Project Fund and used to pay the costs of the Project
and costs of issuance of the Bonds. Until needed to pay such costs, the City may invest those
proceeds temporarily in any legal investment, and the investment earnings shall be retained in the
Project Fund and used for the purposes of that fund, except that earnings subject to a federal tax
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or rebate requirement (if applicable) may be withdrawn from the Project Fund and used for those
tax or rebate purposes.
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 or Pricing Certificate, consistent with the parameters set forth in Exhibit A or the
Pricing Certificate.
(b) Mandatory Redemption. Each Bond that is designated as a Term Bond in the Bond
Purchase Agreement or Pricing Certificate, consistent with the parameters set forth in Exhibit A
and except as 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 or Pricing Certificate. 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 price) 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 Tenn 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 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 of Redemption. 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 Director of Finance and Administrative Services shall
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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 scheduled optional redemption date. Any notice of optional redemption that is
so rescinded shall be of no effect, and each Bond for which a notice of optional 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 of 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 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 `faxes. 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
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 within the constitutional and statutory limitations provided by law without the assent of the
voters, 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 " QUalifieel 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
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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 Director of Finance and Administrative Services
is authorized and directed to review and update 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 Bonds from being
included in gross income for federal tax purposes.
(c) Designation of Bonds as "Qualified Tax -Exempt Obligations." A Series of the
Bonds may be designated as "qualified tax-exempt obligations" for the purposes of
Section 265(b)(3) of the Code, if the following conditions are met:
(1) the Series does not constitute "private activity bonds" within the meaning
of Section 141 of the Code;
(2) the reasonably anticipated amount of tax-exempt obligations (other than
private activity bonds and other obligations not required to be included in such calculation,
including any Series used to refund prior "qualified tax-exempt obligations") 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 Series is issued will not exceed
$10,000,000; and
(3) the amount of tax-exempt obligations, including the Series and excluding
any Series used to refund prior "qualified tax-exempt obligations," 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 Series is 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 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 given, and selection of Bonds for any partial refunding or
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defeasance shall be conducted, in the manner prescribed in this ordinance for the redemption of
Bonds.
Section 14. Use of Proceeds of the Bonds. The amount necessary to carry out the Project
shall be deposited into the Project Fund. The amount necessary to carry out the Refunding Plan
shall be deposited into a refunding account as further described in Section 15.
Section 15. Refunding of the Refunded Bonds.
(a) Appointment of Refunding Trustee. U.S. Bank National Association will serve as
Refunding Trustee in connection with the Bonds.
(b) Use of Bond Proceeds; Acquisition of Acquired Obligations. The proceeds of the
sale of the Bonds to be used to carry out the 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 Refunded Bonds under Ordinance Nos. 2007-42 and 2008-25 by providing for the
payment of the amounts required to be paid by the Refunding Plan. 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 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 amount required to be paid by the Refunding Plan. The Acquired
Obligations, if acquired, will be listed and more particularly described in an exhibit to be attached
to the Refunding Trust Agreement between the City and the Refunding Trustee, but are subject to
substitution as set forth below. Any Bond proceeds or other money deposited with the Refunding
Trustee not needed to purchase the Acquired Obligations and provide a beginning cash balance, if
any, and pay the costs of issuance of the Bonds shall be returned to the City at the time of delivery
of the Bonds to the initial purchaser thereof and deposited in the Bond Fund to pay interest on the
Bonds on the first interest payment date.
If payment of the costs of issuance of the Bonds is not included in the Refunding Plan, the
Bond proceeds that are not deposited with the Refunding Trustee will be deposited with the City
to be used to pay the costs of issuance of the Bonds.
(c) Substitution of Acquired Obligations. Prior to the purchase of any Acquired
Obligations by the Refunding Trustee, the City reserves the right to substitute other direct,
noncallable obligations of the United States of America ("Substitute Obligations") for any of the
Acquired Obligations and to use any savings created thereby for any lawful City purpose if, (a) in
the opinion of the City's 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 (b) such substitution shall 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.
After the purchase of the Acquired Obligations by the Refunding Trustee, if any are
purchased, the City reserves the right to substitute therefor cash or Substitute Obligations subject
to the conditions that such money or securities held by the Refunding Trustee shall be sufficient
to carry out the Refunding Plan, that such substitution will not cause the Bonds or the Refunded
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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 dates of the Bonds and the Refunded Bonds, as applicable, and that the City obtain, at its
expense: (1) a verification by a nationally recognized independent firm acceptable to the
Refunding Trustee confirming that the payments of principal of and interest on the substitute
securities, if paid when due, and any other money held by the Refunding Trustee will be sufficient
to carry out the Refunding Plan; and (2) an opinion from a nationally recognized bond counsel to
the City, to the effect that the disposition and substitution or purchase of such securities, under the
statutes, rules, and regulations then in force and applicable to the 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. 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 for any lawful City purpose.
(d) Administration of Refunding Plan. The Refunding Trustee is authorized and
directed to purchase the Acquired Obligations (or substitute obligations), if so directed by the
Designated Representative, and to make the payments required to be made by the Refunding Plan
from the Acquired Obligations (or substitute obligations) and money deposited with the Refunding
Trustee pursuant to this ordinance. All Acquired Obligations (or substitute obligations) and the
money deposited with the Refunding Trustee and any income therefrom shall be held irrevocably,
invested and applied in accordance with the provisions of Ordinance Nos. 2007-42 and 2008-25,
this ordinance, chapter 39.53 RCW and other applicable statutes of the State of Washington and
the Refunding Trust Agreement. All necessary and proper fees, compensation, and expenses of
the Refunding Trustee for the Bonds and all other costs incidental to the setting up of the escrow
to accomplish the refunding of the Refunded Bonds and costs related to the issuance and delivery
of the Bonds, including bond printing, verification fees, Bond Counsel's fees, and other related
expenses, shall be paid out of the proceeds of the Bonds.
(e) Authorization for Refunding Trust Agreement. To carry out the Refunding Plan
provided for by this ordinance, the Director of Finance and Administrative Services is authorized
and directed to execute and deliver to the Refunding Trustee a 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 such Refunding Trustee set
forth therein are satisfactory to it. Prior to executing the Refunding Trust Agreement, the
Designated Representative of the City is authorized to make such changes therein that do not
change the substance and purpose thereof or that assure that the escrow provided therein and the
Bonds are in compliance with the requirements of federal law governing the exclusion of interest
on the Bonds from gross income for federal income tax purposes.
Section 16. Call for Redemption of the Refunded Bonds. The City calls for redemption
on such date or dates as determined by the Designated Representative, all of the Refunded Bonds
at par plus accrued interest. Such call for redemption shall be irrevocable after the delivery of the
Bonds to the initial Purchaser thereof.
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The proper City officials are authorized and directed to give or cause to be given such
notices as required, at the times and in the manner required by Ordinance Nos. 2007-42 and 2008-
25, in order to effect the redemption prior to their maturity of the Refunded Bonds.
Section 17. Findings with Respect to Refunding. The City Council authorizes the
Designated Representative to issue the Bonds if it will achieve debt service savings to the City and
is in the best interest of the City and its taxpayers and in the public interest. In making such finding
and determination, the Designated Representative will give consideration to the fixed maturities
of the Bonds and the Refunded Bonds, the costs of issuance of the Bonds and the known earned
income from the investment of the proceeds of the issuance and sale of the Bonds and other money
of the City used in the Refunding Plan, if any, pending payment and redemption of the Refunded
Bonds.
The Designated Representative may also purchase Acquired Obligations to be deposited
with the Refunding Trustee, together with the income therefrom, and with any necessary beginning
cash balance, which will be sufficient to redeem the Refunded Bonds and will discharge and satisfy
the obligations of the City under Ordinance Nos. 2007-42 and 2008-25 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 such ordinance immediately upon the deposit of such money with
the Refunding Trustee.
Section 18. Sale and Delivery of the Bonds.
(a) Manner of Sale of Bonds; Delivery of Bonds. The Designated Representative is
authorized to sell each Series of the Bonds by negotiated sale or private placement based on the
assessment of the Designated Representative of market conditions, in consultation with
appropriate City officials and staff, Bond Counsel and other advisors. In determining the method
of sale of a Series and accepting the Final Terms, the Designated Representative shall take into
account those factors that, in the judgment of the Designated Representative, may be expected to
result in the lowest true interest cost to the City.
(b) Procedure for Negotiated Sale or Private Placement. If the Designated
Representative determines that a Series of the Bonds is to be sold by negotiated sale or private
placement, the Designated Representative shall select one or more Purchasers with which to
negotiate such sale. The Bond Purchase Agreement or Pricing Certificate for each Series of the
Bonds shall set forth the Final Terms. The Designated Representative is authorized to execute the
Bond Purchase Agreement or Pricing Certificate on behalf of the City, so long as the terms
provided therein are consistent with the terms of this ordinance.
(c) Preparation, Execution and Delivery of the Bonds. The Bonds will be prepared at
City expense and will be delivered to the Purchaser, together with the approving legal opinion of
Bond Counsel regarding the Bonds.
Section 19. Official Statement; Continuing Disclosure.
(a) Preliminary Official Statement Deemed Final. The Designated Representative
shall review and, if acceptable to him or her, approve the preliminary Official Statement prepared
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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, if applicable, 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
approved by the Designated Representative and been deemed final, if applicable, 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 that has been approved and deemed final in accordance with
subsection (a), 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 if required under Rule 15c2-12. The City authorizes
and approves the distribution by the Purchaser of the final Official Statement so executed and
delivered to purchasers and potential purchasers of a Series of the Bonds.
(c) Undertaking to Provide Continuing Disclosure. If necessary to meet the
requirements of paragraph (b)(5) of Rule 15c2-12, as applicable to the Purchaser acting as a
participating underwriter for a Series of the Bonds, the Designated Representative is authorized to
execute a written undertaking to provide continuing disclosure for the benefit of holders of a Series
of the Bonds in substantially the form attached as Exhibit B.
Section 20. 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 of the 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.
Section 21. General Authorization and lZatification. 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 each Series of the Bonds to the Purchaser thereof 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 22. Severability. The provisions of this ordinance are declared to be separate
and severable. If a court 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
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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 23. 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 of the City of Bainbridge Island, Washington, at an open
public meeting thereof, this 15t- day of October, 2019, and signed in authentication of its passage
this J$f7day of October, 2019.
� � z Z -O
Kol Medina, Mayor
ATTEST/AUTHENTICATE:
C istine Brown, C aty Clerk
APPROVED AS TO FORM:
Bond Counsel
FILED WITH THE CITY CLERK: September 20, 2019
PASSED BY THE CITY COUNCIL: October 1, 2019
PUBLISHED: October 4, 2019
EFFECTIVE DATE: October 9, 2019
ORDINANCE NUMBER: 2019-22
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53487509.5
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 23. 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 of the City of Bainbridge Island, Washington, at an open
public meeting thereof, this _L-st day of October, 2019, and signed in authentication of its passage
this
L—day of October, 2019.
'z��-
Kol Medina, Mayor
ATTEST/AUTHENTICATE:
f
Christine Brown, C , ity Clerk
APPROVED AS TO FORM:
Bond Counsel
FILED WITH THE CITY CLERK: September 20, 2019
PASSED BY THE CITY COUNCIL: October 1, 2019
PUBLISHED: October 4, 2019
EFFECTIVE DATE: October 9, 2019
ORDINANCE NUMBER: 2019-22
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53487504.5
Exhibit A
EXHIBIT A
DESCRIPTION OF THE BONDS
(a) Principal Amount. The Bonds may be issued in one or more Series and shall
not exceed the aggregate principal amount of
$11,500,000, of which the portion of the Bonds to finance
the Project (excluding costs of issuance and underwriter's
discount) will not exceed $8,000,000 and the portion of
the Bonds to refund the Refunded Bonds (excluding costs
of issuance and underwriter's discount) will not exceed
$3,500,000.
(b) Date or Dates. Each Bond shall be dated its Issue Date, which date may
not be later than one year after the effective date of this
ordinance.
(c) Denominations, Name, etc. 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.
(d) Interest Rate(s). Each Bond shall bear interest at a fixed rate per annum
(computed on the basis of a 360 -day year of twelve 30 -
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 5.00%, and the true interest cost to the City for
each Series of the Bonds may not exceed 4.00%.
(e) Payment Dates. Interest shall be payable semiannually on dates
acceptable to the Designated Representative,
commencing no later than June 1, 2020, 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 annually thereafter, on dates acceptable to
the Designated Representative.
(f) Final Maturity. The portion of the Bonds used to finance the Project shall
not mature after December 1, 2039, and the portion of the
Bonds used to refund the Refunded Bonds shall not
mature after June 1, 2028.
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(g)
(h)
(i)
0)
534875095
Redemption Rights. 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 101/2 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.
Price. The purchase price for each Series of the Bonds may not
be less than 98% or more than 130% of the stated
principal amount of that Series.
Minimum Savings. There shall be a minimum net present value savings of
5.00% of the Refunded Bonds
Other Terms and Conditions. (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; may
determine to use City funds to pay the difference
between the par amount of the Refunded Bonds and
the amount received to refund the Refunded Bonds;
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.
A-2
Exhibit B
[Form of]
UNDERTAKING TO PROVIDE CONTINUING DISCLOSURE
City of Bainbridge Island, Washington
Limited Tax General Obligation [Refunding] Bonds, 2019
The City of Bainbridge Island, Washington (the "City"), makes the following written
Undertaking for the benefit of holders of the above -referenced bonds (the "Bonds"), for the sole
purpose of assisting the Purchaser in meeting the requirements of paragraph (b)(5) of Rule 15c2-
12, as applicable to a participating underwriter for the Bonds. Capitalized terms used but not
defined below shall have the meanings given in Ordinance No. of the City (the "Bond
Ordinance").
(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)(i) ("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, or other material events affecting 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; (10) 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;
(14) appointment of a successor or additional trustee or the change of name of a
trustee, if material; (15) incurrence of a financial obligation of the City or obligated
person, if material, or agreement to covenants, events of default, remedies, priority
rights, or other similar terms of a financial obligation of the City or obligated
person, any of which affect security holders, if material; and (16) default, event of
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53487509 5
acceleration, termination event, modification of terms, or other similar events under
the terms of the financial obligation of the City or obligated person, any of which
reflect financial difficulties. The term "financial obligation" means a (i) debt
obligation; (ii) derivative instrument entered into in connection with, or pledged as
security or a source of payment for, an existing or planned debt obligation; or (iii)
guarantee of (i) or (ii). The term "financial obligation" shall not include municipal
securities as to which a final official statement has been provided to the MSRB
consistent with Rule 15c2-12.
(iii) Timely notice of a failure by the City to provide the required annual financial
information described in paragraph (b)(i) on or before the date specified in
paragraph (b)(ii).
(b) Type of Annual Financial Information Undertaken to be Provided. The annual
financial information that the City undertakes to provide in paragraph (a):
(i) Shall consist of (1) annual financial statements prepared (except as noted in the
financial statements) in accordance with applicable 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; (2) principal amount of general
obligation bonds outstanding at the end of the applicable fiscal year; (3) assessed
valuation for that fiscal year; (4) property tax levy amounts and rates for that fiscal
year; and (5) a statement of revenues for that fiscal year from any other revenue
sources pledged to the Bonds;
(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, 2019; 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.
If not submitted as part of the annual financial information described in paragraph (b)(i)
above, the City will provide or cause to be provided to the MSRB audited financial statements,
when and if available.
(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.
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(d) Beneficiaries. This Undertaking 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.
(g) Designation of Official Responsible to Administer Undertaking. The Director of
Finance and Administrative Services or his or her designee is the person designated, in accordance
with the Bond Ordinance, to carry out the Undertaking in accordance with Rule 15c2-12,
including, without limitation, the following actions:
(i) Preparing and filing the annual financial information undertaken to be provided;
(ii) Determining whether any event specified in 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 of this Undertaking.
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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. 2019-22 (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 October 1, 2019, as that ordinance appears on the minute
book of the 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 expected to be October 4, 2019.
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: October 1, 2019.
534875095
CITY OF BAINBRIDGE ISLAND,
WASHINGTON
l
Christine Brown, CMC,- i Clerk