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HomeMy WebLinkAboutO-2830 - Bond issuance (Special)CITY OF MARYSVILLE,WASHINGTON ORDINANCE NO.2830 AN ORDINANCE of the City of Marysville,Washington,relating to contracting indebtedness;providing for the issuance of $6,180,000 par value of Limited Tax General Obligation Improvement and Refunding Bonds,2010,of the City for general City purposes to provide the funds necessary (i)to purchase property and buildings for certain government activities,including municipal court,general government,and park activities and other City purposes approved by motion of the City Council,(ii)to carry out a current refunding of the City's outstanding Limited Tax General Obligation Refunding Bonds,1998,and (iii)to pay the administrative costs of such refunding and to pay the cost of issuance and sale of the Bonds;providing for and authorizing the purchase of certain obligations out of the proceeds of the sale of the bonds herein authorized and for the use and application of the money derived from those investments;authorizing the execution of an agreement with U.S.Bank National Association of Seattle, Washington,as refunding trustee;providing for the purchase of bond insurance; fixing the date,form,maturities,interest rates,terms and covenants ofthe bonds; establishing a bond redemption fund and a project fund;and approving the sale and providing for the delivery of the bonds to Seattle-Northwest Securities Corporation,of Seattle,Washington. WHEREAS,the City of Marysville,Washington (the "City"),is in need of purchasing property and buildings for certain government activities,including municipal court,general government,and park activities and other City purposes approved by motion of the City Council (the "Projects"),the estimated cost of which is approximately $5,125,000,and the City does not have available sufficient funds to pay the cost;and WHEREAS,pursuant to Ordinance No.2212 adopted on November 17,1998 by the City Council of the City (the "City Council"),the City issued its $3,450,000 par value Limited Tax General Obligation Refunding Bonds,1998 (the"1998 Bonds"),for the purpose ofrefunding the callable portion of the City's Limited Tax General Obligation Bonds,1993,issued to provide the funds necessary to pay the costs of acquiring a site for,constructing,furnishing and equipping a new library and carrying out other capital purposes;and -1- 511005061 WHEREAS,there are presently outstanding $1,550,000 par value of 1998 Bonds maturing on December 1,2012,and bearing interest at a rate of 4.35%(the "Refunded Bonds"); and WHEREAS,after due consideration,it appears to the City Council that the Refunded Bonds may be refunded by the issuance and sale of the general obligation refunding bonds authorized herein (the "Bonds")so that a substantial savings will be effected by the difference between the principal and interest cost over the life of the Bonds 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 (as hereinafter defined);and WHEREAS,to effect that refunding in the manner that will be most advantageous to the City it is found necessary and advisable that certain Acquired Obligations (hereinafter defined) bearing interest and maturing at such time or times as necessary to accomplish the refunding as aforesaid be purchased out of a portion of the proceeds of the Bonds and other money of the City;and WHEREAS,the City Council deems it to be in the best interests of the City to issue and sell the Bonds to provide the funds necessary to carry out the Projects and the Refunding Plan; and WHEREAS,Assured Guaranty Municipal Corp.has made a commitment to issue an insurance policy insuring the payment when due of the principal ofand interest on the Bonds as provided therein,and the City Council deems that the purchase of such policy is in the best interests of the City;and -2- 51100506 I WHEREAS,Seattle-Northwest Securities Corporation of Seattle,Washington,has offered to purchase the bonds authorized herein under the terms and conditions hereinafter set forth in the form ofa bond purchase contract;NOW,THEREFORE, THE CITY COUNCIL OF THE CITY OF MARYSVILLE,WASHINGTON,DO ORDAIN AS FOLLOWS: Section 1.Definitions.As used in this ordinance,the following words shall have the following meanings: "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. "Bond Fund"means the Limited Tax General Obligation Bond Fund,2010, created pursuant to Section 19 of this ordinance for the payment ofthe Bonds. "Bond Insurer"means Assured Guaranty Municipal Corp.(formerly known as Financial Security Assurance Inc.),a New York stock exchange insurance company,or any successor thereto or assignee thereof. "Bond Register"means the books or records maintained by the Bond Registrar containing the name and mailing address of the owner of each Bond and the principal amount and number of Bonds held by each owner. "Bond Registrar"means the Fiscal Agent. "Bonds"means the $6,180,000 par value Limited Tax General Obligation Improvement and Refunding Bonds,20 I0,of the City issued pursuant to and for the purposes provided in this ordinance. -3- 5\100506.\ "City"means the City of Marysville,Washington,a municipal corporation duly organized and existing under and by virtue ofthe laws ofthe state ofWashington. "Code"means the United States Internal Revenue Code of 1986,as amended,and applicable rules and regulations promulgated thereunder. "DTC"means The Depository Trust Company,New York,New York. "Finance Director"means the Finance Director of the City. "Fiscal Agent"means the fiscal agent of the State of Washington,as the same may be designated by the State from time to time. "Insurance Policy"means the bond insurance policy issued by the Bond Insurer insuring the payment ofthe Bonds "Letter of Representations"means the Blanket Issuer Letter of Representations dated November 14,1997,between the City and DTC,as it may be amended from time to time. "MSRB"means the Municipal Securities Rulemaking Board. "1998 Bonds"means the City's $3,450,000 par value Limited Tax General Obligation Refunding Bonds,1998 issued pursuant to the Refunded Bond Ordinance. "Project Fund"means the City's General Fund 001,described under Section 19 of this ordinance. "Projects"means the purchasing of property and buildings for certain government activities,including municipal court,general government,and park activities and other City purposes approved by motion ofthe City Council. "Refunded Bonds"means the City's $1,550,000 outstanding Limited Tax General Obligation Refunding Bonds,1998,maturing on December 1,2012,the refunding of which has been provided for by this ordinance. -4- 5J100506 I "Refunded Bond Ordinance"means Ordinance No.2212 of the City passed on November 17,1998,authorizing the sale and issuance of the 1998 Bonds. "Refunding Plan"means: (a)the placement of sufficient proceeds 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; (b)the call,payment,and redemption on November 19,2010, of all of the then-outstanding Refunded Bonds at a price of par plus accrued interest;and (c)the payment of the costs of issuing the Bonds and the costs of carrying <;:lUt the foregoing elements of the Refunding Plan. "Refunding Trust Agreement"means a Refunding Trust Agreement between the City and the Refunding Trustee substantially in the form of that which is on file with the City Clerk and by this reference incorporated herein. "Refunding Trustee"means U.S.Bank National Association of Seattle, Washington,serving as trustee or escrow agent or any successor trustee or escrow agent. "SEC"means the United States Securities and Exchange Commission. Section 2.Debt Capacity.The assessed valuation of the taxable property within the City as ascertained by the last preceding assessment for City purposes for the calendar year 2010 is $4,437,265,961 and the City has outstanding general indebtedness evidenced by limited tax general obligation bonds,notes,leases and conditional sales contracts in the principal amount of $19,011,998 incurred within the limit ofup to 1-1/2%ofthe value of the taxable property within I the City permitted for general municipal purposes without a vote of the qualified voters therein and unlimited tax general obligation bonds in the principal amount of $420,000 incurred within the limit of up to 2 1/2%ofthe value of the taxable property within the City for capital purposes -5- 51100506.1 only,issued pursuant to a vote of the qualified voters ofthe City,and the amount ofindebtedness for which bonds are authorized herein to be issued is $6,180,000.The City has no outstanding unlimited tax general obligation bonds issued for utility purposes or for parks,open space and economic development purposes. Section 3.Authorization ofBonds.The City shall borrow money on the credit ofthe City and issue negotiable limited tax general obligation bonds evidencing that indebtedness in the amount of $6,180,000 for general City purposes to provide the funds necessary (i)to pay for, or reimburse the City for payment of,the Projects,(ii)to carry out the Refunding Plan,and (iii) to pay the costs of issuance and sale of the Bonds (the "costs of issuance").The general indebtedness to be incurred shall be within the limit of up to 1-112%ofthe value of the taxable property within the City permitted for general municipal purposes without a vote ofthe qualified voters therein. Section 4.Description of Bonds.The bonds shall be called Limited Tax General Obligation Improvement and Refunding Bonds,2010,of the City (the "Bonds");shall be in the aggregate principal amount of $6,180,000;shall be dated their date of initial delivery;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 designation as the fiscal agent of the State of Washington (as the same may be designated by the State of Washington from time to time,the "Bond Registrar")deems necessary for purposes of identification;shall bear interest (computed on the basis of a 360-day year of twelve 30-day months)payable semiannually on each June 1 and December 1,commencing December 1,2010,to the maturity or earlier redemption ofthe Bonds;and shall mature on December 1 in years and amounts and bear interest at the rates per annum as follows: -6- 51100506.1 Maturity Interest Years Amounts Rates 2010 $465,000 2.00% 2011 340,000 2.00 2012 385,000 2.00 2014 145,000 2.00 2015 155,000 2.00 2016 155,000 2.00 2017 155,000 2.00 2020 60,000 3.00 ********* 2025 1,025,000 4.50 ********* 2030 1,575,000 5.00 ********* 2034 1,720,000 4.00 The life of the Projects to be acquired with the new money portion of the proceeds ofthe Bonds shall not exceed the term of the Bonds allocable to the Projects. Section 5.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 the Bond Register.The Bond Register shall contain the name and mailing address of the owner of each Bond and the principal amount and number ofeach 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 after notice of redemption ofthat Bond has been given. The Bonds initially shall be registered in the name of Cede &Co.,as the nominee of DTC.The Bonds so registered shall be held in fully immobilized form by DTC as depository in accordance with the provisions of the Letter of Representations.Neither the City nor the Bond -7- 51100506.1 Registrar shall have any responsibility or obligation to DTC participants or the persons for whom they act as nominees with respect to the Bonds regarding accuracy ofany records maintained by DTC or DTC participants of any amount in respect of principal of or interest on the Bonds,or any notice which is permitted or required to be given to registered owners hereunder (except such notice as is required to be given by the Bond Registrar to DTC). For as long as any Bonds are held in fully immobilized form,DTC,its nominee or its successor depository shall be deemed to be the registered owner for all purposes hereunder and all references to registered owners,bondowners,bondholders or the like shall mean DTC or its nominee and,except for the purpose of the City's undertaking herein to provide continuing disclosure,shall not mean the owners of any beneficial interests in the Bonds.Registered ownership ofsuch Bonds,or any portions thereof,may not thereafter be transferred except:(i)to any successor of DTC or its nominee,if that successor shall be qualified under any applicable laws to provide the services proposed to be provided by it;(ii)to any substitute depository appointed by the City or such substitute depository's successor;or (iii)to any person if the Bonds are no longer held in immobilized form. Upon the resignation of DTC or its successor (or any substitute depository or its successor)from its functions as depository,or a determination by the City that it no longer wishes to continue the system of book entry transfers through DTC or its successor (or any substitute depository or its successor),the City may appoint a substitute depository.Any such substitute depository shall be qualified under any applicable laws to provide the services proposed to be provided by it. If (i)DTC or its successor (or substitute depository or its successor)resigns from its functions as depository,and no substitute depository can be obtained,or (ii)the City determines -8- 51100506.1 that the Bonds are to be in certificated form,the ownership of Bonds may be transferred to any person as provided herein and the Bonds no longer shall be held in fully immobilized form. Section 6.Payment of Bonds.Both principal of and interest on the Bonds shall be payable in lawful money of the United States ofAmerica.Interest on the Bonds shall be paid by checks or drafts of the Bond Registrar mailed on the interest payment date to the registered owners at the addresses appearing on the Bond Register on the 15th day of the month preceding the interest payment date or,if requested in writing by a registered owner of $1,000,000 or more in principal amount of Bonds prior to the applicable record date,by wire transfer on the interest payment date.Principal of the Bonds shall be payable upon presentation and surrender of the Bonds by the registered owners to the Bond Registrar.Notwithstanding the foregoing,for as long as the Bonds are registered in the name of DTC or its nominee,payment of principal of and interest on the Bonds shall be made in the manner set forth in the Letter ofRepresentations. Section 7.Redemption Provisions and Open Market Purchase of Bonds.Bonds maturing in the years 2010 through 2020,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 1,2025,prior to their stated maturity dates at any time on or after December 1,2020,as a whole or in part (within one or more maturities selected by the City and randomly within a maturity in such manner as the Bond Registrar shall determine),at par plus accrued interest to the date fixed for redemption. Bonds maturing in 2025,2030 and 2034 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 randomly (in such manner as the Bond -9- 511005061 Registrar shall determine)at par plus accrued interest on December 1 in years and amounts as follows: 2025 Term Bonds Mandatory Redemption Years 2021 2022 2023 2024 2025* *Maturity Mandatory Redemption Amounts $55,000 265,000 280,000 210,000 215,000 2030 Term Bonds Mandatory Redemption Years 2026 2027 2028 2029 2030* *Maturity Mandatory Redemption Amounts $230,000 240,000 350,000 370,000 385,000 2034 Term Bonds Mandatory Redemption Years 2031 2032 2033 2034* *Maturity Mandatory Redemption Amounts $405,000 420,000 440,000 455,000 If the City redeems under the optional redemption provisions,purchases in the open market or defeases Term Bonds,the par amount of the Term Bonds so redeemed,purchased or defeased (irrespective oftheir actual redemption or purchase prices)shall be credited against one or more scheduled mandatory redemption amounts for those Term Bond!!.The City shall -10- 51100506.\ detennine the manner in which the credit is to be allocated and shall notify the Bond Registrar in writing of its allocation at least 60 days prior to the earliest mandatory redemption date for that maturity ofTenn Bonds for which notice ofredemption has not already been given. 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 to the Bond Registrar,there shall be issued to the registered owner,without charge therefor,a new Bond (or Bonds,at the option of the 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 canceled. Notwithstanding the foregoing,for as long as the Bonds are registered in the name of DTC or its nominee,selection of Bonds for redemption shall be in accordance with the Letter of Representations. Section 8.Notice of Redemption.While the Bonds are held by DTC in book-entry only fonn,any notice of redemption shall be given at the time,to the entity and in the manner required by DTC in accordance with the Letter of Representations,and the Bond Registrar shall not be required to give any other notice of redemption.If the Bonds cease to be in book-entry only fonn,the City shall cause notice of any intended redemption of Bonds to 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 of any Bond to be redeemed at the -11- 5J100506 J 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 ofany Bond. In the case of an optional redemption,the notice may state that the City retains the right to rescind the redemption notice and the related optional redemption of Bonds by giving a notice of rescission to the affected registered owners at any time prior to the scheduled optional redemption date.Any notice of optional redemption that is so rescinded shall be of no effect, and the Bonds for which the notice of optional redemption has been rescinded shall remain outstanding. 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 the MSRB,to any nationally recognized rating agency which at the time maintains a rating on the Bonds at the request of the City,to the Bond Insurer,at its principal office in New York, New York,or its successor,and to such other persons and with such additional information as the Finance Director shall determine,but these additional mailings shall not be a condition precedent to the redemption ofBonds. Section 9.Failure To Pay Bonds.If any Bond is not paid 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 ofeach ofthose unpaid Bonds. -12- 51100506 1 Section 10.Pledge of Taxes.For as long as any ofthe 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 ofthose taxes and the prompt payment ofthat principal and interest. Section II.Form and Execution of Bonds.The Bonds shall be prepared in a form consistent with the provisions of this ordinance and state law and shall be 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 thereofshall 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 Improvement and Refunding Bonds,2010, described in the Bond Ordinance. WASHINGTON STATE FISCAL AGENT Bond Registrar By [specimen] Authorized Signer The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bond so authenticated has been duly executed,authenticated and delivered and is entitled to the benefits ofthis ordinance. -13- 51100506.1 If any officer whose facsimile signature appears on the Bonds ceases to be an officer of the City authorized to sign bonds before the Bonds bearing his or her facsimile signature are authenticated or delivered by the Bond Registrar or issued by the City,those Bonds nevertheless may be authenticated,issued and delivered and,when authenticated,issued and delivered,shall be as binding on the City as though that person had continued to be an officer of the City authorized to sign bonds.Any Bond also may be signed on behalf of the City by any person who,on the actual date of signing ofthe Bond,is an officer ofthe City authorized to sign bonds, although he or she did not hold the required office on the date of issuance ofthe Bonds. Section 12.Bond Registrar.The Bond Registrar shall keep,or cause to be kept, sufficient books for the registration and transfer of the Bonds,which shall be open to inspection by the City at all times.The Bond Registrar is authorized,on behalf of the City,to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of the Bonds and this ordinance,to serve as the City's paying agent for the Bonds and to carry out all of the Bond Registrar's powers and duties under this ordinance and City Ordinance No.1405 establishing a system ofregistration 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 13.Preservation ofTax 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 -14- 51100506.J gross income for federal income tax purposes,and it will neither take any action nor make or permit any use of proceeds of the Bonds or other funds of the City treated as proceeds of the Bonds at any time during the 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 the arbitrage rebate requirement of Section 148 of the Code,is applicable to the Bonds,take all actions necessary to comply (or to be treated as having complied)with that requirement 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. Section 14.Designation of Bonds as "Qualified Tax-Exempt Obligations."The City has determined and certifies that (a)the Bonds are not "private activity bonds"within the meaning of Section 141 of the Code;(b)the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds and other obligations not required to be included in such calculation)which 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 ofthe City)will issue during the calendar year in which the Bonds are issued will not exceed $30,000,000;and (c)the amount of tax-exempt obligations, including the Bonds,designated by the City as "qualified tax-exempt obligations"for the purposes of Section 265(b)(3)of the Code during the calendar year in which the Bonds are issued does not exceed $30,000,000.The City designates the Bonds as "qualified tax-exempt obligations"for the purposes of Section 265(b)(3)of the Code. -15- 51100506 I Section 15.Refunding or Defeasance of the Bonds.The City may issue 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 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 City shall include in the refunding or defeasance plan such provisions as the City deems necessary for the random selection of any defeased Bonds that constitute less than all of a particular maturity of the Bonds,for notice of the defeasance to be given to the owners ofthe defeased Bonds and to such other persons as the City shall determine, and for any required replacement of Bond certificates for defeased Bonds.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. -16- 511005061 If the Bonds are registered in the name of DTC or its nominee,notice of any defeasance of Bonds shall be given to DTC in the manner prescribed in the Letter of Representations for notices ofredemption of Bonds. Section 16.Refunding of the Refunded Bonds. (a)Appointment of Refunding Trustee.U.S.Bank National Association of Seattle, Washington,is appointed Refunding Trustee. (b)Use ofBond Proceeds;Acquisition ofAcquired Obligations.A sufficient amount of the proceeds ofthe sale of the Bonds,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 the Refunded Bond Ordinance 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 ofthe amount required to be paid by the Refunding Plan.The Acquired Obligations are listed and more particularly described in Exhibit A attached to the Refunding Trust Agreement between the City and the Refunding Trustee.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 Project Fund to pay costs ofthe Projects. (c)Administration of Refunding Plan.The Refunding Trustee is authorized and directed to purchase the Acquired Obligations and to make the payments required to be made by -17- 51100506.1 the Refunding Plan from the Acquired Obligations and money deposited with the Refunding Trustee pursuant to this ordinance.All Acquired 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 the Refunded Bond Ordinance,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 ofthe proceeds of the Bonds. (d)Authorization for Refunding Trust Agreement.To carry out the Refunding Plan provided for by this ordinance,the Chief Administrative Officer of the City or the Finance Director is authorized and directed to execute and deliver to the Refunding Trustee a Refunding Trust Agreement substantially in the form on file with the City Clerk and by this reference made a part hereof setting forth the duties,obligations and responsibilities ofthe 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 Chief Administrative Officer of the City or the Finance Director is authorized to make such changes therein that do not change the substance and purpose thereofor 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. -18- 51100506.1 Section 17.Call for Redemption of the Refunded Bonds.The City calls for redemption on November 19,20 10,all ofthe 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.The date on which the Refunded Bonds are herein called for redemption is the first date on which those bonds may be called. 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,pursuant to the Refunded Bond Ordinance in order to effect the redemption prior to their maturity of the Refunded Bonds. Section 18.City Findings with Respect to Refunding.The City Council of the City finds and determines that the issuance and sale of the Bonds at this time will effect a savings to the City and is in the best interest of the City and its tax payers and in the public interest.In making such finding and determination,the City Council has given 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 ofthe Bonds and other money of the City used in the Refunding Plan pending payment and redemption ofthe Refunded Bonds. The City Council further finds and detennines that the money to be deposited with the Refunding Trustee for the Refunded Bonds in accordance with Section 16 ofthis ordinance will discharge and satisfy the obligations of the City under the Refunded Bond Ordinance 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 ofsuch money with the Refunding Trustee. -19- 511005061 Section 19.Bond Fund and Deposit ofBond Proceeds. (a)Bond Fund.There is created and established in the office of the Finance Director a special fund designated as the Limited Tax General Obligation Bond Fund,2010 (the "Bond Fund"),for the purpose ofpaying principal of and interest on the Bonds.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. (b)The Refunding.On the date of closing,a sufficient amount of proceeds of the Bonds to carry out the Refunding Plan,along with other money of the City,shall be deposited with the Refunding Trustee in accordance with the provisions of Section 16 ofthis ordinance. (c)The Project Fund.The remaining Bond proceeds not deposited with the Refunding Trustee shall be paid into the City's General Fund 001 and used for the purposes specified in Section 2 ofthis ordinance (the "Project Fund").Until needed to pay the costs ofthe Projects,the City may invest principal proceeds temporarily in any legal investment,and the investment earnings may be retained in the Project 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 Project Fund and used for those tax or rebate purposes. Section 20.Approval of Bond Purchase Contract.Seattle-Northwest Securities Corporation 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 accepts the offer contained therein and authorizes its execution by City officials. -20- 51100506 1 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 PLLC,municipal bond counsel of Seattle,Washington,regarding the Bonds. 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 ofthe sale thereof. Section 21.Bond Insurance.The City Council finds that a higher rating and,therefore, a savings,will result from purchasing the Insurance Policy issued by the Bond Insurer insuring the payment of the Bonds.The Mayor of the City and the Finance Director are each authorized to execute the commitment of the Bond Insurer to issue the Insurance Policy and all other documents on behalf of the City necessary in connection with the Insurance Policy.Any actions heretofore taken by such officials not inconsistent with this section are hereby ratified and confirmed. Section 22.Preliminary Official Statement Deemed Final.The City Council has been provided with copies of a preliminary official statement dated September 30,2010 (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 ofthe Bonds dependent on such matters. Section 23.Undertaking to Provide Continuing Disclosure.To meet the requirements of SEC Rule 15c2-12(b)(5)(the "Rule"),as applicable to a participating underwriter for the -21- 511005061 Bonds,the City makes the following written undertaking (the "Undertaking")for the benefit of holders ofthe Bonds: (a)Undertaking to Provide Annual Financial Information and Notice ofMaterial 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 subsection (b)ofthis section ("annual financial information"); (ii)Timely notice of the occurrence of any of the following events with respect to the Bonds,if material:(1)principal and interest payment delinquencies;(2)non-payment related defaults;(3)unscheduled draws on debt service reserves reflecting financial difficulties; (4)unscheduled draws on credit enhancements reflecting financial difficulties;(5)substitution ofcredit or liquidity providers,or their failure to perfonn;(6)adverse tax opinions or events affecting the tax-exempt status of the Bonds;(7)modifications to rights of holders of the Bonds; (8)Bond calls (other than scheduled mandatory redemptions of Term Bonds);(9)defeasances;(10)release,substitution,or sale of property securing repayment ofthe Bonds;and (11)rating changes;and (iii)Timely notice of a failure by the City to provide required annual financial infonnation on or before the date specified in subsection (b)ofthis section. (b)Type ofAnnual Financial Information Undertaken to be Provided. The annual financial information that the City undertakes to provide in subsection (a)ofthis section: (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 Washington state local governmental units,as such principles may be changed from time to time,which statements shall not be audited,except,however,that if and when audited financial statements are otherwise prepared and available to the City they will be provided;(2)authorized,issued and outstanding balance of general obligation bonds;(3)assessed valuation for the fiscal year;and (4)regular property tax levy rate and regular property tax levy rate limit for the fiscal year; (ii)Shall be provided not later than the last day of the ninth month after the end ofeach fiscal year of the City (currently,a fiscal year -22- 51100506.1 51100506\ 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 31,2010;and (iii)May be provided in a single or multiple documents,and may be incorporated by specific reference to documents available to the public on the Internet website of the MSRB or filed with the SEC. (c)Amendment of Undertaking.The Undertaking is subject to amendment after the primary offering of the Bonds without the consent of any holder of any Bond,or of any broker,dealer,municipal securities dealer, participating underwriter,rating agency or the MSRB,under the circumstances and in the manner permitted by the Rule. 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 ofthe effect of that change on the type of information to be provided. (d)Beneficiaries.The Undertaking evidenced by this section shall inure to the benefit of the City and any holder of Bonds,and shall not inure to the benefit of or create any rights in any other person. (e)Termination of Undertaking.The City's obligations under this Undertaking shall terminate upon the legal defeasance of all of the Bonds.In addition,the City's obligations under this Undertaking shall terminate if those provisions of the Rule which require the City to comply with this Undertaking become legally inapplicable in respect of the Bonds for any reason,as confirmed by an opinion of nationally recognized bond counselor other counsel familiar with federal securities laws 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 ofany failure to comply with the Undertaking,the City will proceed with due diligence to cause such noncompliance to be corrected. No failure by the City or other obligated person to comply with the Undertaking shall constitute a default in respect of the Bonds.The sole remedy of any holder of a Bond shall be to take such actions as that holder deems necessary,including seeking an order of specific performance from an appropriate court,to compel the City or other obligated person to comply with the Undertaking. (g)Designation of Official Responsible to Administer Undertaking. The Finance Director of the City (or such other officer of the City who may in the future perform the duties of that office)or his or her designee is authorized and directed in his or her discretion to take such further actions as may be necessary, -23- appropriate or convenient to carry out the Undertaking of the City in respect of the Bonds set forth in this section and in accordance with the Rule,including, without limitation,the following actions: (i)Preparing and filing the annual financial information undertaken to be provided; (ii)Determining whether any event specified in subsection (a) has occurred,assessing its materiality with respect to the Bonds,and,if material,preparing and disseminating notice of its occurrence; (iii)Determining whether any person other than the City is an "obligated person"within the meaning of the Rule with respect to the Bonds,and obtaining from such person an undertaking to provide any annual financial information and notice of material events for that person in accordance with the Rule; (iv)Selecting,engaging and compensating designated agents and consultants,including but not limited to financial advisors and legal counsel,to assist and advise the City in carrying out the Undertaking;and (v)Effecting any necessary amendment ofthe Undertaking. Section 24.Severability.Should any section,paragraph,sentence,clause or phrase of this ordinance,or its application to any person or circumstance,be declared unconstitutional or otherwise invalid for any reason,or should any portion ofthis ordinance be pre-empted by state or federal law or regulation,such decision or pre-emption shall not affect the validity of the remaining portions ofthis ordinance or its application to other persons or circumstances. Section 25.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. -24- 51100506.l PASSED by the City Council and APPROVED by the Mayor of the City of Marysville, Washington,at a special open public meeting thereof,this 7th day of October,2010. CITY OF MARYSVILLE,WASHINGTON.-/ ATTEST: Jon APPROVED AS TO FORM: I hereby certifY thi<:t('he '1 true and correct copy ofthe original on file in my office as part ofthe o .records ofthe ci M ville Date ---.::....-.-I-.L.;f-c-:::::...----- -25- 511005061 CERTIFICATION I,the undersigned,City Clerk of the City of Marysville,Washington (the "City"),hereby certify as follows: 1.The attached copy of Ordinance No.2830 (the "Ordinance")is a full,true and correct copy of an ordinance duly passed at a special meeting ofthe City Council of the City held at the regular meeting place thereof on October 7,2010,as that ordinance appears on the minute book of the City;and the Ordinance will be in full force and effect five days after publication in the City's official newspaper;and 2.A quorum of the members of the City Council was present throughout the meeting and a majority of those members present voted in the proper manner for the passage of the Ordinance;and 3.Written notice specifying the time and place of the special meeting and noting the business to be transacted was given to all members of the City Council by mail or by personal delivery at least 24 hours prior to the special meeting,a true and complete copy of which notice is attached hereto as Appendix 1;and 4.Written notice of the special meeting was given to each local radio or television station and to each newspaper of general circulation that has on file with the City a written request to be notified ofspecial meetings,or to which such notice customarily is given. IN WITNESS WHEREOF,I have hereunto set my hand this 7th day of October,2010. CITY OF MARYSVILLE,WASHINGTON Qw1 (J&-Ttacy Jeffrie clCief 511005061 APPENDIX 1 OFFICE OF CITY CLERK Tracy Jeffries 1049 State Avenue Marysville,Washington 98270 360.363.8000 marysvillewa.gov MARYSVILLE CITY COUNCIL SPECIAL MEETING NOTICE NOTICE IS HEREBY GIVEN that the Marysville City Council will hold a Special Meeting on Thursday,October 7,2010,at 5:45 p.m.The meeting will be held at the Marysville City Hall,1049 State Avenue,Marysville,Washington. The purpose of the special meeting is for acceptance of the bond purchase agreement and approval of the bond ordinance. If you have any questions,please feel free to call the City Clerk's office at 360.363.8000. CITY OF MARYSVILLE Tracy Jeffries Asst.Admin.Services Director DATED:October 4,2010 NOTICE DOES NOT REQUIRE PUBLICATION 51100506.1