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HomeMy WebLinkAboutO-1943 - Bond issuance (Special)CITY OF MARYSVILLE,WASHINGTON ORDINANCE NO./((0/3 d~;lIVe- ,9-2500/<:::?L{<{. I-?~ I-~p~>,- ~ AN ORDINANCE of the City of Marysville,Washington, relating to contracting indebtedness;providing for the issuance,specifying the maturities,interest rates, terms and covenants of $3,700,000 par value of Limited Tax General Obligation Bonds,1993,authorized by the qualified voters of the City at a special election held therein pursuant to Ordinance No.1898;establishing a bond redemption fund and an acquisition and construction fund;and approving the sale and providing for the delivery of the bonds to Seattle-First National Bank of Seattle,Washington. THE CITY COUNCIL OF THE CITY OF MARYSVILLE,WASHINGTON,DO ORDAIN as follows: section 1.Authorization of Bonds Pursuant to Election.The City of Marysville,Washington (the "City"),has need for the proceeds of and shall issue and sell the total $3,700,000 par value of negotiable general obligation bonds authorized by the qualified voters of the City at a special election held on September 15, 1992,in conjunction with the State primary election held on the same date,pursuant to Ordinance No.1898 passed and approved July 6,1992,for the purpose of paying the cost of acquiring a site for,constructing,furnishing and equipping a new library and carrying out other capital purposes. Section 2.Description of Bonds.The bonds shall be called Limited Tax General Obligation Bonds,1993,of the city (the "Bonds");shall be in the aggregate principal amount of $3,700,000; shall be dated April 1,1993;shall be in the denomination of $5,000 or any integral mUltiple thereof within a single maturity; shall be numbered separately in the manner and with any additional 0069724.03 -1- designation as the Bond Registrar (collectively,the fiscal agencies of the state of Washington located in Seattle,Washington, and New York,New York)deems necessary for purposes of identification;shall bear interest at the rates set forth below (computed on the basis of a 360-day year of twelve 30-day months), payable on December 1,1993,and semiannually thereafter on each succeeding June 1 and December 1;and shall mature on December 1 in years and amounts and bear interest at the rates per annum as follows: Maturity Interest Years Amounts Rates 1996 $5,000 4.000% 1997 20,000 4.100 1998 35,000 4.300 1999 55,000 4.500 2000 70,000 4.800 2001 95,000 5.000 2002 120,000 5.150 2003 145,000 5.300 2004 175,000 5.400 2005 210,000 5.500 2006 250,000 5.600 2007 290,000 5.650 2008,335,000 5.700 *******2012 1,895,000 5.875 The life of the capital facility to be acquired with the proceeds of the Bonds exceeds the term of the Bonds. section 3.Registration and Transfer of Bonds.The Bonds shall be issued only in registered form as to both principal and interest and shall be recorded on books or records maintained by the Bond Registrar (the "Bond Register").The Bond Register shall contain the name and mailing address of the owner of each Bond and 0069724.03 -2- the principal amount and number of each of the Bonds held by each owner. Bonds surrendered to the BOnd Registrar may be exchanged for Bonds in any authorized denomination of an equal aggregate principal amount and of the same interest rate and maturity.Bonds 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 or transfer any Bond during the fifteen days preceding any principal payment or redemption date. section 4.Payment of Bonds.Both principal of and interest on the Bonds shall be payable in lawful money of the united states of America.Interest on the Bonds shall be paid by checks or drafts mailed on the interest payment date to the registered owners at the addresses appearing on the Bond Register on the fifteenth day of the month preceding the interest payment date.Principal of the Bonds shall be payable upon presentation and surrender of the Bonds by the registered owners at either of the principal offices of the Bond Registrar at the option of the owners. section 5.optional Redemption,Mandatory Redemption and Open Market Purchase of Bonds.Bonds maturing in the years 1996 through 2003,inclusive,shall be issued without the right or option of the city to redeem those Bonds prior to their stated maturity dates. The city reserves the right and option to redeem the Bonds maturing on or after December 1,2004,prior to their stated maturity dates, as a whole,or in part in inverse order of maturity (and by lot 0069724.03 -3- within a maturity in such manner as the Bond Registrar shall determine),on December 1,2003,or on any interest payment date thereafter,at par plus accrued interest to the date fixed for redemption. Bonds maturing in 2012 are Term Bonds and,if not redeemed under the optional redemption provisions set forth above or purchased in the open market under the provisions set forth below, shall be called for redemption by lot (in such manner as the Bond Registrar shall determine)at par plus accrued interest on December 1 in years and amounts as follows: Mandatory Redemption Years 2009 2010 2011 2012 Mandatory Redemption Amounts $385,000 440,000 500,000 570,000 In the event that the City shall redeem Term Bonds under the optional redemption provisions set forth above or purchase Term Bonds in the open market as set forth below,the Term Bonds so redeemed or purchased (irrespective of their redemption or purchase price)shall be credited at the par amount thereof against the last scheduled mandatory redemption amount. Portions of the principal amount of any Bond,in installments of $5,000 or any integral multiple thereof,may be redeemed.If less than all of the principal amount of any Bond is redeemed,upon surrender of that Bond at either of the principal offices of the Bond Registrar,there shall be issued to the registered owner, without charge therefor,a new Bond (or Bonds,at the option of the 0069724.03 -4- registered owner)of the same maturity and interest rate in any of the denominations authorized by this ordinance in the aggregate principal amount remaining unredeemed. The City further reserves the right and option to purchase any or all of the Bonds in the open market at any time at any price acceptable to the city plus accrued interest to the date of purchase. All Bonds purchased or redeemed under this section shall be cancelled. section 6.Notice of Redemption.The city shall cause notice of any intended redemption of Bonds to be given not less than 30 nor more than 60 days prior to the date fixed for redemption by first-class mail,postage prepaid,to the registered owner of any Bond to be redeemed at the address appearing on the Bond Register at the time the Bond Registrar prepares the notice,and the requirements of this sentence shall be deemed to have been fulfilled when notice has been mailed as so provided,whether or not it is actually received by the owner of any Bond.Interest on Bonds called for redemption shall cease to accrue on the date fixed for redemption unless the Bond or Bonds called are not redeemed when presented pursuant to the call.In addition,the redemption notice shall be mailed within the same period,postage prepaid,to Moody's Investors Service,Inc.,and standard &Poor's Corporation at their offices in New York,New York,or their successors,to Seattle-First National Bank,at its principal office in Seattle, Washington,or its successor,to Municipal Bond Investors Assurance corporation,at its principal office in Armonk,New York (the "Bond 0069724.03 -5- Insurer"),or its successor,and to such other persons and with such additional information as the City Finance Director shall determine,but these additional mailings shall not be a condition precedent to the redemption of Bonds. section 7.Failure to Redeem Bonds.If any Bond is not redeemed when properly presented at its maturity or call date,the City shall be obligated to pay interest on that Bond at the same rate provided in the Bond from and after its maturity or call date until that Bond,both principal and interest,is paid in full or until sufficient money for its payment in full is on deposit in the bond redemption fund hereinafter created and the Bond has been called for payment by giving notice of that call to the registered owner of each of those unpaid Bonds. section 8.Pledge of Taxes.For as long as any of the Bonds are outstanding,the city irrevocably pledges to include in its budget and levy taxes annually within the constitutional and statutory tax limitations provided by law without a vote of the electors of the city on all of the taxable property within the City in an amount sufficient,together with other money legally available and to be used therefor,to pay when due the principal of and interest on the Bonds,and the full faith,credit and resources of the city are pledged irrevocably for the annual levy and collection of those taxes and the prompt payment of that principal and interest. section 9.Form and Execution of Bonds.The Bonds shall be printed or lithographed on good bond paper in a form consistent wi th the provisions of this ordinance and state law,shall be 0069724.03 -6- signed by the Mayor and city Clerk,either or both of whose signatures may be manual or in facsimile,and the seal of the City or a facsimile reproduction thereof shall be impressed or printed thereon. Only Bonds bearing a certificate of Authentication in the following form,manually signed by the Bond Registrar,shall be valid or obligatory for any purpose or entitled to the benefits of this ordinance: CERTIFICATE OF AUTHENTICATION This bond is one of the fully registered city of Marysville,Washington,Limited Tax General Obligation Bonds,1993,described in the Bond Ordinance. WASHINGTON STATE FISCAL AGENCY Bond Registrar By Authorized Officer The authorized signing of a certificate of Authentication shall be conclusive evidence that the Bonds so authenticated have been duly executed,authenticated and delivered and are entitled to the benefits of this ordinance. If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the city authorized to sign bonds before the Bonds bearing his or her facsimile signature are authenticated or delivered by the Bond Registrar or issued by the city,those Bonds nevertheless may be authenticated,delivered and issued 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 0069724.03 -7- of the Bond,is an officer of the City authorized to sign bonds, although he or she did not hold the required office on the date of issuance of the Bonds. section 10.Bond Registrar.The Bond Registrar shall keep, or cause to be kept,at its principal corporate trust office, sufficient books for the registration and transfer of the Bonds which shall be open to inspection by the City at all times.The Bond Registrar is authorized,on behalf of the City,to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of the Bonds and this ordinance,to serve as the city's paying agent for the Bonds and to carry out all of the Bond Registrar's powers and duties under this ordinance and City Ordinance No.1405 establishing a system of registration for the city's bonds and obligations. The Bond Registrar shall be responsible for its representations contained in the Bond Registrar's certificate of Authentication on the Bonds.The Bond Registrar may become the owner of Bonds with the same rights it would have if it were not the Bond Registrar and,to the extent 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 Bond owners. section 11.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 0069724.03 -8- other funds of the city treated as proceeds of the Bonds at any time during the term of the Bonds which 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 arbitrage rebate requirements of section 148 of the Internal Revenue Code of 1986,as amended (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,including the calculation and payment of any penalties that the City has elected to pay as an alternative to calculating rebatable arbitrage,and the payment of any other penalties if required under section 148 of the Code to prevent interest on the Bonds from being included in gross income for federal income tax purposes.The city certifies that it has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose arbitrage certifications may not be relied upon. section 12.Bonds Negotiable.The Bonds shall be negotiable instruments to the extent provided by RCW 62A.8-102 and 62A.8-105. section 13.Advance Refunding or Defeasance of the Bonds. The city may issue advance refunding bonds pursuant to the laws of the State of Washington or use money available from any other lawful source to pay when due the principal of and interest on the Bonds,or any portion thereof included in a refunding or defeasance plan,and to redeem and retire,refund or defease all such then- outstanding Bonds (hereinafter collectively called the "defeased Bonds")and to pay the costs of the refunding or defeasance.If 0069724.03 -9- money and/or "government obligations"(as defined in Chapter 39.53 RCW,as now or hereafter amended)maturing at a time or times and bearing interest in amounts (together with money,if necessary) sufficient to redeem and retire,refund or defease the defeased Bonds in accordance with their terms are set aside in a special trust fund or escrow account irrevocably pledged to that redemption,retirement or defeasance of defeased Bonds (hereinafter called the "trust account"),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.The owners of defeased Bonds shall have the right to receive payment of the principal of and interest on the defeased Bonds from the trust account.The defeased Bonds shall be deemed no longer outstanding,and the city may apply any money in any other fund or account established for the payment or redemption of the defeased Bonds to any lawful purposes as it shall determine. In the event that the principal of and/or interest due on the Bonds is paid by the Bond Insurer pursuant to the policy issued by the Bond Insurer insuring the payment of the principal of and interest on the Bonds (the "Municipal Bond Insurance Policy"),the Bonds shall not be considered paid by the city,and the covenants, agreements and other obligations of the city to the registered owners shall continue to exist and the Bond Insurer shall be subrogated to the rights of the registered owners. section 14.Bond Fund and Deposit of Bond Proceeds.There is created and established in the office of the City Finance Director 0069724.03 -10- a special fund designated as the Limited Tax General Obligation Bond Fund,1993 (the "Bond Fund").Accrued interest on the Bonds, if any,received from the sale and delivery of the Bonds shall be paid into the Bond Fund.There also is created and established in the office of the City Finance Director a special fund designated as the Library Construction Fund,1993 (the "Acquisition and Construction Fund").The principal proceeds received from the sale and delivery of the Bonds shall be paid into the Acquisition and Construction Fund and used for the purposes specified in section 1 of this ordinance.until needed to pay the costs of the Project and costs of issuance of the Bonds,the City may invest principal proceeds temporarily in any legal investment,and the investment earnings may be retained in the Acquisition and Construction Fund and be spent for the purposes of that fund except that earnings subject to a federal tax or rebate requirement may be withdrawn from the Acquisition and Construction Fund and used for those tax or rebate purposes.All taxes collected for and allocated to the payment of the principal of and interest on the Bonds shall be deposited in the Bond Fund. section 15.Approval of Bond Purchase Contract.Seattle- First National Bank of Seattle,Washington,has presented a purchase contract (the "Bond Purchase Contract")to the city offering to purchase the Bonds under the terms and conditions provided in the Bond Purchase Contract,which written Bond Purchase Contract is on file with the city Clerk and is incorporated herein by this reference.The City Council finds that entering into the Bond Purchase Contract is in the City's best interest and therefore 0069724.03 -11- accepts the offer contained therein and authorizes its execution by appropriate City officials. The Bonds will be printed at City expense and will be delivered to the purchaser in accordance with the Bond Purchase Contract,with the approving legal opinion of Foster Pepper & Shefelman,municipal bond counsel of seattle,Washington,regarding the Bonds printed on each Bond.Bond counsel shall not be required to review and shall express no opinion concerning the completeness or accuracy of any official statement,offering circular or other sales material issued or used in connection with the Bonds,and bond counsel's opinion shall so state. The proper city officials are authorized and directed to do everything necessary for the prompt delivery of the Bonds to the purchaser and for the proper application and use of the proceeds of the sale thereof. section 16.Preliminary Official statement Deemed Final.The city council has been provided with copies of a preliminary official statement dated February 25,1993 (the "Preliminary Official statement"),prepared in connection with the sale of the Bonds.For the sole purpose of the Bond purchaser's compliance with securities and Exchange Commission Rule 15c2-12 (b)(1),the City "deems final"that Preliminary Official statement as of its date,except for the omission of information as to offering prices, interest rates,selling compensation,aggregate principal amount, principal amount per maturity,maturity dates,options of redemption,delivery dates,ratings and other terms of the Bonds dependent on such matters. 0069724.03 -12- section 17.Temporary Bond.Pending the printing,execution and delivery to the purchaser of definitive Bonds,the City may cause to be executed and delivered to the purchaser a single temporary Bond in the total principal amount of the Bonds.The temporary Bond shall bear the same date of issuance,interest rates,principal payment dates and terms and covenants as the definitive Bonds,shall be issued as a fully registered Bond in the name of the purchaser,and otherwise shall be in a form acceptable to the purchaser.The temporary Bond shall be exchanged for definitive Bonds as soon as they are printed,executed and available for delivery. section 18.Bond Insurance.The City Council finds that it is in the city's best interest to purchase,and that a savings will result from purchasing,the Municipal Bond Insurance Policy for the Bonds.The city shall purchase from the Bond Insurer the Municipal Bond Insurance Policy insuring the prompt payment of the principal of and interest on the Bonds and agrees to the conditions for obtaining that policy,including the payment of the premium therefor and the following provisions entitled "Payments under the Policy"required by the Bond Insurer to be included in this ordinance: "A.In the event that,on the second Business Day,and again on the Business Day,prior to the payment date on the Obligations,the Paying Agent has not received sufficient moneys to pay all principal of and interest on the Obligations due on the second following or following,as the case may be, Business Day,the Paying Agent shall immediately notify the Insurer or its designee on the same Business Day by telephone or telegraph,confirmed in writing by registered or certified mail,of the amount of the deficiency. 0069724.03 -13- 0069724.03 "B.If the deficiency is made up in whole or in part prior to or on the payment date,the Paying Agent shall so notify the Insurer or its designee. "c.In addition,if the Paying Agent has notice that any Bondholder has been required to disgorge payments of principal or interest on the Obligation to a trustee in Bankruptcy or creditors or others pursuant to a final judgment by a court of competent jurisdiction that such payment constitutes a voidable preference to such Bondholder within the meaning of any applicable bankruptcy laws,then the Paying Agent shall notify the Insurer or its designee of such fact by telephone or telegraphic notice,confirmed in writing by registered or certified mail. "D.The Paying Agent is hereby irrevocably designated, appointed,directed and authorized to act as attorney-in-fact for Holders of the Obligations as follows: "1.If and to the extent there is a deficiency in amounts required to pay interest on the Obligations,the Paying Agent shall (a)execute and deliver to Citibank,N.A.,or its successors under the Policy (the "Insurance Paying Agent"),in form satisfactory to the Insurance Paying Agent,an instrument appointing the Insurer as agent for such Holders in any legal proceeding related to the payment of such interest and an assignment to the Insurer of the claims for interest to which such deficiency relates and which are paid by the Insurer,(b)receive as designee of the respective Holders (and not as Paying Agent)in accordance with the tenor of the Policy payment from the Insurance Paying Agent with respect to the claims for interest so assigned,and (c)disburse the same to such respective Holders;and "2.If and to the extent of a deficiency in amounts required to pay principal of the Obligations,the Paying Agent shall (a)execute and deliver to the Insurance Paying Agent in form satisfactory to the Insurance Paying Agent an instrument appointing the Insurer as agent for such Holder in any legal proceeding relating to the payment of such principal and an assignment to the Insurer of any of the Obligation surrendered to the Insurance Paying agent of so much of the principal amount thereof as has not previously been paid or for which moneys are not held by the Paying Agent and available for such payment (but such assignment shall be delivered only if payment from the Insurance Paying Agent is received),(b)receive as designee of the respective Holders (and not as Paying Agent)in accordance with the tenor of the -14- ·0069724.03 Policy payment therefor from the Insurance Paying Agent,and (c)disburse the same to such Holders. "E.Payments with respect to claims for interest on and principal of Obligations disbursed by the Paying Agent from proceeds of the Policy shall not be considered to discharge the obligation of the Issuer with respect to such Obligations, and the Insurer shall become the owner of such unpaid Obligations and claims for the interest in accordance with the tenor of the assignment made to it under the provisions of this subsection or otherwise. "F.Irrespective of whether any such assignment is executed and delivered,the Issuer and the Paying Agent hereby agree for the benefit of the Insurer that, "1.They recognize that to the extent the Insurer makes payments,directly or indirectly (as by paying through the Paying Agent),on account of principal of or interest on the Obligations,the Insurer will be sUbrogated to the rights of such Holders to receive the amount of such principal and interest from the Issuer,with interest thereon as provided and solely from the sources stated in this Indenture and the Obligations;and "2.They will accordingly pay to the Insurer the amount of such principal and interest (including principal and interest recovered under sUbparagraph (ii)of the first paragraph of the Policy,which principal and interest shall be deemed past due and not to have been paid),with interest thereon as provided in this Indenture and the Obligations,but only from the sources and in the manner provided herein for the payment of principal of and interest on the Obligations to Holders,and will otherwise treat the Insurer as the owner of such rights to the amount of such principal and interest. "G.In connection with the issuance of additional Obligations,the Issuer shall deliver to the Insurer a copy of the disclosure document,if any,circulated with respect to such additional Obligations. "H.Copies of any amendments made to the documents executed in connection with the issuance of the Obligations which are consented to by the Insurer shall be sent to Standard &Poor's Corporation. "I.The Insurer shall receive notice of the resignation or removal of the Paying Agent and the appointment of a successor thereto. -1.5- "J.The Insurer shall receive copies of all notices required to be delivered to Bondholders and,on an annual basis,copies of the Issuer's audited financial statements and Annual Budget. "Notices"Any notice that is required to be given to a holder of the Obligation or to the Paying Agent pursuant to the Indenture shall also be provided to the Insurer.All notices required to be given to the Insurer under the Indenture shall be in writing and shall be sent by registered or certified mail addressed to Municipal Bond Investors Assurance Corporation,113 King street,Armonk,New York 10504 Attention:Surveillance." section 19.Effective Date of Ordinance.This ordinance shall take effect and be in force from and after its passage and five (5)days following its publication as required by law. PASSED by the city Council at a regular open public meeting thereof,this 22nd day of March,1993,and APPROVED by the Mayor. Mayor ATTEST: APPROVED AS TO FORM: city Attorney 0069724.03 -16-