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HomeMy WebLinkAbout4491 CITY OF BREMERTON, WASHINGTON ORDINANCE NO. ,~/.~;/ AN ORDINANCE of the City of Bremerton, Washington, relating to contracting indebtedness; providing for the issuance of $5,000,000 par value of Limited Tax General Obligation Bonds, 1994, of the City for general City purposes to provide funds with which to pay the cost of designing and constructing a second 18-hole regulation golf course to be located at the City's Gold Mountain Golf Complex and to pay a part of the cost of issuing and selling the bonds; fixing the date, form, maturities, interest rates, terms and covenants of the bonds; establishing a bond redemption fund and a construction fund; providing for bond insurance; approving the sale and providing for the delivery of the bonds to Seattle- First National Bank of Seattle, Washington; and providing that this ordinance will take effect immediately. WHEREAS, the City of Bremerton, Washington (the "City"), is in need of a second 18-hole regulation golf course to be located at the City's Gold Mountain Golf Complex, the estimated cost of which is $5,000,000, and the City does not have available sufficient funds to pay the cost; and WHEREAS, AMBAC Indemnity Corporation, a Wisconsin-domiciled stock insurance company, has made a commitment to issue an insurance policy (the "Municipal Bond Insurance Policy") relative to the bonds authorized herein, effective as of the date of issuance of those bonds, and the city Council deems that the purchase of the Municipal Bond Insurance Policy is in the best interest of the City; NOW, THEREFORE, THE CITY OF BREMERTON DOES ORDAIN as follows: Section 1. 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 1994 0155133.03 --1-- collections is $1,169,824,600, and the City has $5,335,000 of outstanding general indebtedness evidenced by limited tax general obligation bonds, notes, and installment purchase contracts incurred within the limit of up to 1-1/2% of the value of the taxable property within 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 $ 2,045,000 incurred within the limit of up to 2-1/2% of the value of the taxable property within the City for capital purposes only and the amount of indebtedness for which bonds are authorized herein to be issued is $5,000,000. Section 2. Authorization of Bonds. The City shall borrow money on the credit of the City and issue negotiable limited tax general obligation bonds evidencing that indebtedness in the amount of $5,000,000 for general City purposes to provide the funds to pay the cost of designing and constructing a second 18-hole regulation golf course at the City's Gold Mountain Golf Course (the "Project") and 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 1-1/2% of the value of the taxable property within the City permitted for general municipal purposes without a vote of the qualified voters therein. Section 3. Description of Bonds. The bonds shall be called Limited Tax General Obligation Bonds, 1994, of the City (the "Bonds"); shall be in the aggregate principal amount of $5,000,000; shall be dated November 15, 1994; shall be in the denomination of $5,000 or any integral multiple thereof within a single maturity; 0155133.03 --2-- shall be numbered separately in the manner and with any additional 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 June 1, 1995, and semiannually thereafter on each succeeding December 1 and June 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 1997 $195,000 5.25% 1998 200,000 5.50 1999 215,000 5.70 2000 225,000 5.90 2001 495,000 6.00 2002 525,000 6.10 2003 555,000 6.20 2004 590,000 6.30 2005 625,000 6.40 2006 665,000 6.50 2007 710,000 6.70 The life of the capital facilities to be acquired with the proceeds of the Bonds exceeds the term of the Bonds. Section 4. 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 the principal amount and number of each of the Bonds held by each owner. 0155133.03 --3-- contain the name and mailing address of the owner of each Bond and 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 15 days preceding any principal payment or redemption date. Section 5. 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 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. 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 6. Optional Redemption and Open Market Purchase of ~onds. Bonds maturing in the years 1997 through 2002, 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 0155133.03 ~4~ after December 1, 2003, prior to their stated maturity dates, as a whole, or in part (within maturities to be selected by the City and by lot within a maturity in such manner as the Bond Registrar shall determine), on any interest payment date on and after December 1, 2002, at the redemption prices (stated as a percentage of par) set forth below plus accrued interest to the date fixed for redemption: Redemption Dates Redemption Prices December 1, 2002, and 102% June 1, 2003 December 1, 2003, and 101% June 1, 2004 December 1, 2004, and thereafter 100% (par) The City further reserves the right and option to purchase any or all of the Bonds at any time at any price plus accrued interest to the date of purchase. All Bonds purchased or redeemed under this section shall be cancelled. Section 7. 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 0155133.~ notice shall be mailed within the same period, postage prepaid, to Moody's Investors Service, Inc., and Standard & Poor's Ratings Group 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 AMBAC Indemnity Corporation ("AMBAC Indemnity" or the "Bond Insurer") at its principal office in New York, New York, and to such other persons and with such additional information as the City Treasurer shall determine, but these additional mailings shall not be a condition precedent to the redemption of Bonds. Section 8. 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 9. 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 0155133.03 --6-- 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 10. Form and Execution of Bonds. The Bonds shall be printed or lithographed on good bond paper in a form consistent with the provisions of this ordinance and state law, 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 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 Bremerton, Washington, Limited Tax General Obligation Bonds, 1994, described in the Bond Ordinance. WASHINGTON STATE FISCAL AGENCY Bond Registrar By 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 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 01551~.~ 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 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 Il. 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. 3862 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 Certificates 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 0155133.03 committee formed to protect the rights of Bond owners. Section 12. 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 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 13. Bonds Negotiable. The Bonds shall be negotiable instruments to the extent provided by RCW 62A.8-102 and 62A.8-105. 0155133 .O3 --9-- Section 74. 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) or other permitted investments as set forth in Exhibit A 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 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 such lawful purposes as it shall determine. The City shall provide for notice to the owners of defeased Bonds and for the replacement of Bond certificates, including the selection by lot of Bond 0155133.03 -10- certificates to be replaced should less than an entire annual maturity of Bonds be defeased. If the principal of and/or interest due on the Bonds is paid by the Bond Insurer pursuant to its policy 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 of the Bonds shall continue to exist and the Bond Insurer shall be subrogated to the rights of the registered owners. Section 15. Bond Fund and Deposit of Bond Proceeds. There is created and established in the office of the City Treasurer a special fund designated as the Limited Tax General Obligation Bond Fund, 1994 (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. 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. There also is created and established in the office of the City Treasurer a special fund designated as the Second Golf Course Construction Fund (the "Construction Fund"). The principal proceeds and premium, if any, received from the sale and delivery of the Bonds shall be paid into the Construction Fund to carry out the purposes of the Bonds. 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 Construction Fund and be 0155133.03 spent for the purposes of that fund except that earnings subject to a federal tax or rebate requirement may be withdrawn from the Construction Fund and used for those tax or rebate purposes. Section 16. ADDrOVal of Bond Purchas~ 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 accepts the offer contained therein and authorizes its execution by 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 definitive 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. 015.~133.03 -12- f~]~/. Preliminary Official Statement Deemed Final. The City Council has been provided with copies of a preliminary official statement dated October 27, 1994 (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. Section 18. 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 19. Bond Insurance. The City is authorized to 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, 0155133.~ -13- including the payment of the premium therefor. Any notice required to be given to the Bond Insurer shall be sent by certified or registered mail to AMBAC Indemnity Corporation, One State Street Plaza, New York, New York 10004. While the Municipal Bond Insurance Policy is in effect, the City or the Bond Registrar shall furnish to the Bond Insurer: (a) As soon as practicable after the filing thereof, copies of any financial statements, audits and annual reports of the City; (b) copies of any notices given to the registered owners of the Bonds, including, without limitation, notices of any defeasance of Bonds, and any certificate rendered pursuant to this ordinance relating to the security for the Bonds; and (c) such additional information the Bond Insurer may reasonably request. The Bond Registrar shall notify the Bond Insurer of any failure of the City to provide relevant notices and certificates. The City will permit the Bond Insurer to discuss the affairs, finances and accounts of the City or any information the Bond Insurer may reasonably request regarding the security for the Bonds with appropriate officers of the City. The Bond Registrar and the City will permit the Bond Insurer to have access to and make copies of all books and records relating to the Bonds at any reasonable time. The Bond Insurer shall have the right to direct an accounting at the City's expense, and the City's failure to comply with such direction within 30 days after receipt of written notice of the 0155133.03 -14- direction from the Bond Insurer shall be deemed a default hereunder unless compliance cannot occur within such period. In that event and only if an extension would not materially adversely affect the interest of any registered owner of the Bonds, that 30-day period will be extended so long as compliance is begun within that period and diligently pursued. $~c~ion 20. Pa~%rment Procedures Under Bond Insurance. The Bond Insurer requires that the following sections be included in this ordinance: "(a) At least one (1) day prior to all Interest Payment Dates the Trustee or Paying Agent, if any, will determine whether there will be sufficient funds in the Funds and Accounts to pay the principal of or interest on the Bonds on such Interest Payment Date. If the Trustee or Paying Agent, if any, determines that there will be insufficient funds in such Funds or Accounts, the Trustee or Paying Agent, if any, shall so notify AMBAC Indemnity. Such notice shall specify the amount of the anticipated deficiency, the Bonds to which such deficiency is applicable and whether such Bonds will be deficient as to principal or interest, or both. If the Trustee or Paying Agent, if any, has not so notified AMBAC Indemnity at least one (1) day prior to an Interest Payment Date, AMBAC Indemnity will make payments of principal or interest due on the Bonds on or before the first (lst) day next following the date on which AMBAC Indemnity shall have received notice of nonpayment from the Trustee or Paying Agent, if any. "(b) the Trustee or Paying Agent, if any, shall, after giving notice to AMBAC Indemnity as provided in (a) above, make available to AMBAC Indemnity and, at AMBAC Indemnity's direction, to the United States Trust Company of New York, as insurance trustee (the "Insurance Trustee"), the registration books of the Issuer maintained by the Trustee or Paying Agent, if any, and all records relating to the Funds and Accounts maintained under this ordinance. "(c) the Trustee or Paying Agent, if any, shall provide AMBAC Indemnity and the Insurance Trustee with a list of registered owners of Bonds entitled to receive principal or interest payments from AMBAC Indemnity under the terms of the Municipal Bond Insurance Policy, and shall make arrangements with the Insurance Trustee (i) to 0155133.~ -15- mail checks or drafts to the registered owners of Bonds entitled to receive full or partial interest payments from AMBAC Indemnity and (ii) to pay principal upon Bonds surrendered to the Insurance Trustee by the registered owners of Bonds entitled to receive full or partial principal payments from AMBAC Indemnity. "(d) the Trustee or Paying Agent, if any, shall, at the time it provides notice to AMBAC Indemnity pursuant to (a) above, notify registered owners of Bonds entitled to receive the payment of principal or interest thereon from AMBAC Indemnity (i) as to the fact of such entitlement, (ii) that AMBAC Indemnity will remit to them all or a part of the interest payments next coming due upon proof of Bondholder entitlement to interest payments and delivery to the Insurance Trustee, in form satisfactory to the Insurance Trustee, of an appropriate assignment of the registered owner's right to payment, (iii) that should they be entitled to receive full payment of principal from AM~AC Indemnity, they must surrender their Bonds (along with an appropriate instrument of assignment in form satisfactory to the Insurance Trustee to permit ownership of such Bonds to be registered in the name of AM~AC Indemnity) for payment to the Insurance Trustee, and not the Trustee or Paying Agent, if any, and (iv) that should they be entitled to receive partial payment of principal from AMBAC Indemnity, they must first surrender their Bonds for payment thereon first to the Trustee or Paying Agent, if any, who shall note on such Bonds the portion of the principal paid by the Trustee or Paying Agent, if any, and the, along with an appropriate instrument of assignment in form satisfactory to the Insurance Trustee, to the Insurance Trustee, which will then pay the unpaid portion of principal. "(e) in the event that the Trustee or Paying Agent, if any, has notice that any payment of principal of or interest on a Bond which has become Due for Payment and which is made to a Bondholder by or on behalf of the Issuer has been deemed a preferential transfer and theretofore recovered from its registered owner pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with the final, nonappealable order of a court having competent jurisdiction, the Trustee or Paying Agent, if any, shall, at the time AMBAC Indemnity is notified pursuant to (a) above, notify all registered owners that in the event that any registered owner's payment is so recovered, such registered owner will be entitled to payment from AMBAC Indemnity to the extent of such recovery if sufficient funds are not otherwise available, and the Trustee or Paying Agent, if any, shall furnish to AMBAC Indemnity its records evidencing the payments of principal of and interest on the Bonds which have been made by the Trustee or Paying Agent, if any, and subsequently recovered from registered owners and the dates on which such payments were made. "(f) in addition to those rights granted AMBAC Indemnity under this ordinance, AMBAC Indemnity shall, to the extent it makes payment of principal of or interest on Bonds, become subrogated to the rights of the recipients of such payments in accordance with the terms of the Municipal Bond Insurance Policy, and to evidence such subrogation (i) in the case of subrogation as to claims for past due interest, the Trustee or Paying Agent, if any, shall note AMBAC Indemnity's rights as subrogee on the registration books of the Issuer maintained by the Trustee or Paying Agent, if any, upon receipt from AMBAC Indemnity of proof of the payment of interest thereon to the registered owners of the Bonds, and (ii) in the case of subrogation as to claims for past due principal, the Trustee or Paying Agent, if any, shall note AMBAC Indemnity's rights as subrogee on the registration books of the Issuer maintained by the Trustee or Paying Agent, if any, upon surrender of the Bonds bythe registered owners thereof together with the proof of the payment of principal thereof." Section 21. Parties Interested Herein. To the extent that this ordinance confers upon or gives or grants to the Bond Insurer any right, remedy or claim under or by reason of this ordinance, the Bond Insurer expressly is recognized as being a third-party beneficiary hereunder and may enforce any such right, remedy or claim conferred, given or granted hereunder. Nothing expressed or implied in this ordinance is intended or shall be construed to confer upon, or to give to, any person or entity, other than the City, the Bond Insurer and the registered owners of the Bonds, any right, remedy or claim under or by reason of this ordinance or any covenant, condition or stipulation hereof, and all covenants, stipulations, promises and agreements in this ordinance contained by and on behalf of the City shall be for the sole and exclusive benefit of the City, the Bond Insurer and the registered owners of the Bonds. 0155133.03 -17- Notwithstanding any other provision of this ordinance, the city shall notify the Bond Insurer immediately if at any time there are insufficient funds to make any payments of principal and/or interest as required and immediately upon the occurrence of any event of default hereunder. Any provision of this ordinance expressly recognizing or granting rights in or to the Bond Insurer may not be amended in any manner which affects the rights of the Bond Insurer hereunder without the prior written consent of the Bond Insurer. Unless otherwise provided in this section, the Bond Insurer's consent shall be required, in addition to Bond owner consent when required, for the following purposes: (i) execution and delivery of any supplemental ordinance, and (ii) initiation or approval of any other action which requires Bond owner consent. Anything in this ordinance to the contrary notwithstanding, upon the occurrence and continuance of an event of default, the Bond Insurer shall be entitled to control and direct the enforcement of all rights and remedies granted to the Bond owners for the benefit of the Bond owners under this ordinance. Section 22. Permitted Investments. Permitted investments for funds available for investment in the funds created by this ordinance shall be as set forth in Exhibit A, attached hereto and by this reference made a part hereof. Section 23. Effective Date of Ordinance. The City is in urgent need of the Project and has been advised that a favorable market exists at this time for the sale of the Bonds resulting in lower interest rates on the Bonds and a savings to the City and its 0155133.03 taxpayers. Therefore, the City Council finds that sufficient urgency exists to require that this ordinance take effect immediately upon its passage and publication. PASSED UNANIMOUSLY by the City Council of the city of Bremerton, Washington this 9th day of November, 1994. Council Preside~ft APPROVED this ~ day of J~,._) ~.5e?'~.-~-4.~... , 1994. ATTEST: K~THLEEN McCLUSKEY, City Clerk APPROVED AS TO FORM: George Mack, Bond C~unsel Publication Date: /!-../,~.2 ~ ~'~ ,. Ordinance Number: ~4/~z'/9/ 0155133.03 -19- I, KATHLEEN McCLUSKEY, city Clerk of the city of Bremerton, Washington, certify that the attached copy of Ordinance No. is a true and correct copy of the original ordinance passed on the 9th day of November, 1994, as such ordinance appears on the Minute Book of the City. DATED this ~ ~?~ day of ~'o¢~,~%_ , 1994. KATHLEEN McCLUSKEY, City Cler~ 0155133.03 EXHIBIT A PERMITTED INVESTMENTS (MODIFIED AS OF JULY 19, 1993) A. AMBAC Indemnity will allow the following obligations to be used as Permitted Investments for all purposes, including defeasance investments in refunding escrow accounts. (AMBAC Indemnity does not give a premium credit for the investment of accrued and/or capitalized interest.) (1) Cash (insured at all times by the Federal Deposit Insurance Corporation or otherwise collateralized with obligations described in paragraph (2) below), or (2) Direct obligations of (including obligations issued or held in book entry form on the books of) the Department of the Treasury of the United States of America. B. AMBAC Indemnity will allow the following Obligations to be used as Permitted Investments for all purposes other than defeasance investments in refunding escrow accounts. (1) obligations of any of the following federal agencies which obligations represent the full faith and credit of the United States of America, including: - Export-Import Bank Farm Credit System Financial Assistance Corporation - Farmers Home Administration - General Services Administration - U.S. Maritime Administration - Small Business Administration ~ Government National Mortgage Association (GNMA) - U.S. Department of Housing & Urban Development (PHA's) Federal Housing Administration; (2) senior debt obliqations rated "AAA" by Standard & Poor's Corporation (S&P) and "Aaa" by Moody's Investors Service, Inc. (Moody's) issued by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation. Senior debt obliqations of other Government Sponsored Agencies approved by AMBAC Indemnity; (3) U.S. dollar denominated deposit accounts, federal funds and banker's acceptances with domestic commercial banks which have a rating on their short term certificates of deposit on the date of purchase of "A-I" or "A-1 +" by S&P and "P-I" by Moody's and maturing no more than 360 days after the date of purchase. (Ratings on holding companies are not considered as the rating of the bank); (4) commercial paper which is rated at the time of purchase in the single highest classification, "A-l+" by S&P and "P-I" by Moody's and which matures not more than 270 days after the date of purchase; (5) investments in a money market fund rated "AAAm" or "AAAm-G" or better by S&P; (6) Pre-refunded Municipal Obligations defined as follows: Any bonds or other obligations of any state of the United States of America or of any agency, instrumentality or local governmental unit of any such state which are not callable at the option of the obligor prior to maturity or as to which irrevocable instructions have been given by the obligor to call on the date specified in the notice; and (A) which are rated, based on an irrevocable escrow account or fund (the "escrow"), in the highest rating category of S&P and Moody's or any successors thereto; or (B) (i) which are fully secured as to principal and interest and redemption premium, if any, by an escrow consisting only of cash or obligations described in paragraph A(2) above, which escrow may be applied only to the payment of such principal of and interest and redemption premium, if any, on such bonds or other obligations on the maturity date or dates thereof or the specified redemption date or dates pursuant to such irrevocable instructions, as appropriate, and (ii) which escrow is sufficient, as verified by a nationally recognized independent certified public accountant, to pay principal of and interest and redemption premium, if any, on the bonds or other obligations described in this paragraph on the maturity date or dates specified in the irrevocable instructions referred to above, as appropriate; [Pre-refunded Municipal Obligations meeting the requirements of subsection (B) hereof may not be used as Permitted Investments for annual appropriation lease transactions without the prior written approval of S&P.] (7) investment agreements approved in writing by AMBAC Indemnity Corpnration [supported by appropriate opinions of counsel] with notice to S&P; (8) other forms of investments (includinq repurchase aqreements) approved in writing by AMBAC with notice to S&P.; and (9) participation in the State of Washington local government investment pool. C. The value of the above investments shall be determined as follows: '~/alue", which shall be determined as of the end of each month, means that the value of any investments shall be calculated as follows: a) as to investmentS the bid and asked prices of which are published on a regular basis in The Wall Street Journal (or, if not there, then in The New York Times): the average of the bid and asked prices for such investments so published on or most recently prior to such time of determination; b) as to investments the bid and asked prices of which are not published on a regular basis in The Wall Street Journal or The New York Times: the average bid price at such time of determination for such investments by any two nationally recognized government securities dealers (selected by the Trustee in its absolute discretion) at the time making a market in such investments or the bid price published by a nationally recognized pricing service; c) as to certificates of deposit and bankers acceptances: the face amount thereof, plus accrued interest; and d) as to any investment not specified above: the value thereof established by prior agreement between the Issuer, the Trustee and AMBAC Indemnity Corporation.