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HomeMy WebLinkAbout3327 CITY OF BREMERTON, WASHINGTON o.3 AN ORDINANCE of the City of Bremerton, Washington, providing for the issuance of $755,000.00 par value of "City of Bremerton Parking Revenue .~ Bonds, Series 1976," for the purpose of providing the funds to redeem $740,000.00 par value of its outstanding "City of Bremerton Parking Revenue Bonds" dated November 1, 1970; fixing the date, form, denomination, maturities, interest rate, terms and covenants of such refunding bonds; providing for and authorizing the purchase of certain obligations of the United States of America out of the proceeds of the sale of such refunding bonds and for the use and appli- cation of the moneys to be derived from such investment; providing for the redemption on November 1, 1987, of the then outstanding "City of Bremerton Parking Revenue Bonds" dated November 1, 1970; authorizing the execution of an agreement with Seattle-First National Bank, Seattle, Washington, as Refunding Trustee; confirming the sale and providing for the delivery of the refunding bonds to First Washington Corporation, Seattle, Washington; and declaring an emergency. WHEREAS, Ordinance No. 2915 passed October 21, 1970, specified and adopted a plan for the acquisition, construction and installation by the City of Bremerton of certain off-street parking facilities, declared the estimated cost thereof and provided for the issuance of revenue bonds of the City to pay such cost, and pursuant to Ordinance No. 2916 passed October 21, 1970, the City issued and sold $1,025,000.00 par value of "City of Bremerton Parking Revenue Bonds" (hereinafter called the "1970 Bonds") dated November 1, 1970, for the purpose of providing funds to pay part of the cost of carrying out such plan providing for off-street parking facilities; and WHEREAS, such presently outstanding 1970 Bonds mature serially in varying amounts on November 1 in each of the years from 1977 to 2000, inclusive, and bear interest at varying rates from 7-1/2% per annum to 8-1/4% per annum; and WHEREAS, as provided in Ordinance No. 2916 and in the outstanding 1970 Bonds, the City reserved the right to redeem such 1970 Bonds on any interest pa~.%ent date on and after November 1, 1985, at the following prices expressed as a percentage of the principal amount, plus accrued interest to the date of redemption: On November 1, 1985, and May 1, 1986, at 104% On November 1, 1986, and May 1, 1987, at 103% On November 1, 1987, and May 1, 1988, at 102% On November 1, 1988, and May 1, 1989, at 101% On November 1, 1989, and any interest payment date thereafter, at 100% and after November 1, 1987, there will be outstanding $740,000.00 par value of such 1970 Bonds, being bonds numbered 58 to 205, inclusive; and WHEREAS, after due consideration it appears to the City Council that such $740,000.00 par value of the outstanding 1970 Bonds may be refunded on November 1, 1987, by the issuance and sale of refunding bonds so that a substantial saving will be effected by the difference between the principal and interest costs over the life of the refunding bonds and the principal and interest costs over the life of such outstanding 1970 Bonds; and WHEREAS, in order to effect such refunding in the manner that will be most advantageous to the City, it is hereby found necessary and advisable that certain obligations of the United States of America bearing interest at such time or times as necessary to pay the interest on the refunding bonds until the said outstanding 1970 Bonds are refunded and retired and to pay the principal of and call premium on such outstanding 1970 Bonds on the date when such bonds are to be called for such redemption be purchased out of the proceeds of the sale of the refunding bonds herein authorized; and WHEREAS, under date of October 27, 1976, First Washington Corporation presented its written offer to purchase $755,000.00 par value of refunding bonds under the terms and conditions set forth -2- in such offer whereby a savings of approximately $76,000.00 may be realized by the City, which offer was duly accepted by the City Council on October 27, 1976; NOW, THEREFORE, THE CITY OF BREMERTON DOES ORDAIN: Section 1. Definitions. As used in this ordinance, unless a different meaning clearly appears from the context: (a) "Refunding Bond" or "Refunding Bonds" shall mean the refunding parking revenue bonds of the City in the aggregate principal amount of $755,000.00 issued pursuant to and for the purposes provided in this ordinance. (b) "1970 Bonds" shall mean the outstanding "City of Bremerton Parking Revenue Bonds" issued under date of November 1, 1970, pursuant to Ordinance No. 2916. (c) "City" shall mean the City of Bremerton, a municipal corporation of the State of Washington. (d) "Parking System" shall mean the off-street parking system of the City provided for in Ordinance No. 2915 and any other off-street parking facilities hereafter constructed by the City. (e) "Gross Revenues of the Parking System" shall mean all gross revenues derived from the Parking System, including without limitation all fees, tolls, rates, rentals and other charges received for or in connection with the use of the Parking System and all other income and receipts derived by the City from the operation of the Parking System or arising from the Parking System. (f) "Net Revenues of the Parking System" shall mean the Gross Revenues of the Parking System remaining after the payment therefrom of the Current Expenses of the System. (g) "Current Expenses of the Parking System" shall mean the necessary and reasonable expenses of management, operation and repair of the Parking System and any other expenses reasonably necessary to maintain and preserve the Parking System in good repair and working order but does not include depreciation or obsolescence, --~-- or expenses in connection with additions, extensions or other capital improvements. (h) "Gross Receipts from On-Street Parking Meters" shall mean all gross revenues or funds derived by the City from any and all street parking meters owned and controlled by the City. It includes all rates, fees and charges made for the parking on public streets and ways within the City and collected by use of parking meters but shall not include fines levied for violation of parking ordinances and regulations. (i) "Parity Bonds" shall mean any revenue bonds of the City issued after the date of issuance of the Refunding Bonds, having a lien upon the Gross Revenues of the Parking System and the Gross Receipts from On-Street Parking Meters, for the payment of the principal of and interest thereon equal to the lien for the payment of the principal of and interest on the 1970 Bonds until November 1, 1987, and thereafter for the payment of the principal of and interest on the Refunding Bonds. Section 2. Refundin~ Bonds Authorized. The City shall now issue the Refunding Bonds for the purpose of providing funds to redeem and retire on November 1, 1987, all of the then outstanding 1970 Bonds, being bonds numbered 58 to 205, inclusive, of a total par value of $740,000.00, and to pay the costs of such refunding. Section 3. Description of Refunding Bonds. The Refunding Bonds shall be dated December 17, 1976, shall be in the denomination of $5,000.00 each, shall bear interest at the rate of 7.25% per annum, payable March 1, 1977, and semiannually thereafter on the first days of each succeeding September 1 and March 1, and shall be numbered and mature September 1 in order of their number as follows = --4-- Bond Numbers ( I nclus ive) Amounts Maturiti es 1 to 10 $ 50,000 1988 11 to 18 40,000 1989 19 to 27 45,000 1990 28 to 37 50,000 1991 38 to 47 50,000 1992 48 to 58 55,000 1993 59 to 70 60,000 1994 71 to 83 65,000 1995 84 to 97 70,000 1996 98 to 112 75,000 1997 113 to 128 80,000 1998 129 to 145 85,000 1999 146 to 151 30,000 2000 Both principal of and interest on the Refunding Bonds shall be payable in lawful money of the United States of America at the office of the Treasurer of the City and shall be payable solely out of the special Parking Revenue Bond Fund 1970 created by Section 9 of Ordinance No. 2916, and shall be a valid claim of the holder thereof only as against such special fund and the investment income from certain United States obligations hereinafter referred to until November 1, 1987, and thereafter the fixed amount of the Gross Revenues of the Parking System and the Gross Receipts from On-Street Parking Meters pledged to such fund, and shall not be a general obligation of the City. Section 4. Right of Prior Redemption. The City hereby reserves the right to redeem the Refunding Bonds outstanding as a whole, or in part in inverse numerical order, on any interest payment date on and after November 1, 1987, at par plus accrued interest to the date of redemption. Notice of any such intended redemption shall be given by one publication thereof in the official newspaper of the City not more than forty (40) nor less than thirty (30) days prior to said redemption date and by mailing like notices at the same time to Standard & Poor's Corporation and Moody's Investors Service, Inc., New York, New York, and to First Washington Corporation at its main office in Seattle, Washi~ton, or to their successors, if any. Interest on any Refunding Bond or Refunding Bonds so called for -5- redemption shall cease on such redemption date unless the same shall not be redeemed upon presentation made pursuant to such call. Section 5. Form of Refunding Bonds and Coupons. The Refunding Bonds shall be known as "City of Bremerton Parking Revenue Refunding Bonds, Series 1976," and shall be in substantially the following form: No. $5,000.00 UNITED STATES OF AMERICA STATE OF WASHINGTON CITY OF BREMERTON PARKING REVENUE REFUNDING BOND, SERIES 1976 7.25% KNOW ALL MEN BY THESE PRESENTS: That the City of Bremerton, a municipal corporation of the State of Washington (hereinafter called the "City"), hereby acknowledges itself to owe and for value received promises to pay to bearer on the FIRST DAY OF SEPTEMBER, , the principal sum of FIVE THOUSAND DOLLARS together with interest thereon at the rate of 7.25% per annum, payable March 1, 1977, and semiannually thereafter on the first days of each succeeding September and March as evidenced by and upon presenta- tion and surrender of the attached interest coupons as they severally become due or until the payment of such principal sum shall have been made or duly provided for. Both principal of and interest on this bond are payable in lawful money of the United States of America at the office of the Treasurer of the City solely out of the special fund of the City known as the "City of Bremerton Parking Revenue Bond Fund 1970" (hereinafter called the "Bond Fund"), created by Ordinance No. 2916. The City has reserved the right to redeem the bonds of this issue as a whole, or in part in inverse numerical order, on any interest payment date on and after November 1, 1987, at par plus accrued interest to the date of redemption. Notice of any such intended redemption shall be given by one publication thereof in the official newspaPer of the City not more than forty (40) nor less than thirty (30) days prior to said redemption date and by mailing like notices at the same time to Standard & Poor's Corporation and Moody's Investors Service, Inc., New York, New York, and to First Washington Corporation at its main office in Seattle, Washington, or to their successors, if any. Interest on any bond or bonds so called for redemption shall cease on such redemption date unless the same shall not be redeemed upon presentation made pursuant to such call. -6- This bond is one of an issue of refunding parking revenue bonds of the City of like amount, date and tenor, except as to number and date of maturity, in the aggregate principal amount of $755,000.00, which bonds are issued for the purpose of providing funds to redeem and retire on November 1, 1987, all of the then outstanding "City of Bremerton Parking Revenue Bonds" dated November 1, 1970 (hereinafter called the "1970 Bonds"), and to pay the costs of such refunding. The interest on this bond is payable solely out of the investment income from certain United States Govern- ment Obligations purchased out of the proceeds of the sale of the bonds of this issue until November 1, 1987, and thereafter both principal of and interest on this bond are payable solely out of the Gross Revenue of the Parking System and the Gross Receipts from On-Street Parking Meters (as such terms are defined in Ordinance No. __, hereinafter called the "Bond Ordinance"). The City hereby covenants and agrees with the owner and holder of this bond that it will keep and perform all of the covenants of this bond and of the Bond Ordinance to be by it kept and performed. The City does hereby pledge and bind itself to set aside from the City of Bremerton Parking System Revenue Fund created by Ordinance No. 2916 and to pay into the Bond Fund and the Reserve Account therein the various amounts required by Ordinance No. 2916 and the Bond Ordinance to be paid into and maintained in said Fund and Account all within the times provided in Ordinance No. 2916 and the Bond Ordinance. The City further obligates and binds itself to pay into said Revenue Fund the Gross Revenues of the Parking System and the Gross Receipts from On-Street Parking Meters. The amounts so pledged are hereby declared to be a prior lien and charge upon the moneys in such Revenue Fund and such Gross Revenues and Gross Receipts, superior to all other charges of any kind or nature and equal in rank to any charges made on such Fund and such Gross Revenues and Gross Receipts to pay and secure the payment of the principal of and interest on any bonds that the City may later issue on a parity with the outstanding 1970 Bonds until November 1, 1987, and thereafter with the bonds of this issue. The City has further bound itself to maintain the Parking System in good condition and repair, to operate the same in an efficient manner and at a reasonable cost and to establish, maintain and collect fees, tolls, rates, rentals and other charges for the use of the Parking System which together with the Gross Receipts from On-Street Parking Meters will make available annually for the payment of the principal of and interest on the outstanding 1970 Bonds until November 1, 1987, and thereafter for the payment of the principal of and interest on the bonds of this issue as the same shall become due an amount equal to at least 1.5 times the average annual debt service on such outstanding bonds after payment of Current Expenses (as defined in the Bond Ordinance) of the Parking System, but before depreciation. -7- It is hereby certified and declared that the bonds of this issue are issued pursuant to and in strict compliance with the Constitution and laws of the State of Washington and ordinances of the City and that all acts, conditions and things required to be done precedent to and in the issuance of this bond have happened, been done and performed. IN WITNESS WHEREOF, the City has caused this bond to be signed with the facsimile signature of its Mayor, to be attested by the manual signature of its City Clerk, the corporate seal to be impressed hereon and the interest coupons attached hereto to be signed with the facsimile signatures of said officials this seventeenth day of December, 1976. CITY OF BREMERTON, WASHINGTON By (facsimile s i~nature) Mayor ATTEST: City Clerk The interest coupons to be attached to said Refunding Bonds shall be in substantially the following form: No. $181.25 ($ on Coupon No. 1) (Unless the bond hereinafter referred to has been previously redeemed) On the FIRST DAY OF (MARCH)(SEPTEMBER), , the CITY OF BREMERTON, WASHINGTON, will pay to--~rer at the office of the City the amount shown hereon in lawful money of the United States of America out of the special fund of the City known as the "Parking Revenue Bond Fund 1970," such sum being the interest due that date on its "City of Bremerton Parking Revenue Refunding Bond, Series 1976," dated December 17, 1976, and numbered . CITY OF BREMERTON, WASHINGTON By (facsimile signature) Mayor ATTEST: (facsimile signature) Cfty Clerk Section 6. Execution of Refunding Bonds. The Refunding Bonds shall be executed on behalf of the City with the facsimile signature of its Mayor, shall be attested by the manual signature of its City Clerk and shall have the corporate seal of the City impressed --8-- thereon. Each of the interest coupons attached thereto shall be signed with the facsimile signatures of such officials. Section 7. Disposition of Refunding Bonds Proceeds. So much of the proceeds of the sale of the Refunding Bonds as found to be necessary shall be used immediately upon receipt thereof to' purchase from the United States Government certain United States Treasury Certificates of Indebtedness, Notes and Bonds - State and Local Government Series (commonly called "book entry obligations") in the principal amount of $750,000.00 due November 1, 1987, and bearing interest at the rate of 7.30% per annum. The balance of the principal proceeds received shall be used toward payment of the costs of the refunding operation. Such book entry obligations to be so purchased shall be irrevocably deposited with Seattle- First National Bank, Seattle, Washington (hereinafter called the "Refunding Trustee"). Ail the moneys received as principal and interest on such book entry obligations shall be held by the Refunding Trustee in trust and shall be used for the sole purpose of paying the interest on the Refunding Bonds until the outstanding 1970 Bonds shall have been called, paid and retired on November 1, 1987, and for the purpose of paying the principal of and call premium on said outstanding 1970 Bonds on the date they are to be called for re- demption as aforesaid. Se.c~i~ ~. C~i~ for Re~_e..mption of 1970 Bonds - Refundin~ Trustee. The City Clerk is hereby authorized and directed to cause to be published once not less than thirty nor more than forty days prior to November 1, 1987, in a newspaper of general circulation within the City, a notice of call for redemption of all outstanding 1970 Bonds numbered 58 to 205, inclusive, and also to mail like notice6 at the same time to Standard & Poor's Corporation and Moodyts Investors Service, Inc., New York, New York, and Wm. P. Harper & Son & Company and Blyth & Co., Inc., Seattle, Washington, as provided by Ordinance No. 2916 and in the 1970 Bonds. Such 1970 -9- Bonds shall be paid and redeemed on November 1, 1987, at a price of $102.00 per each $100.00 par value thereof, plus accrued interest. The Refunding Trustee is hereby authorized and directed to pay interest on the Refunding Bonds until the outstanding 1970 Bonds shall have been called, retired and paid, and to pay the principal on the 1970 Bonds on the date they are to be called for redemption as aforesaid. All interest on and principal of the above-described book entry obligations received prior to the date such moneys are needed to make any payment of interest on the Refunding Bonds or the principal of the outstanding 1970 Bonds to be called and retired on November 1, 1987, as provided herein, may only be reinvested by said Refunding Trustee so long as such reinvestments do not in any manner cause the Refunding Bonds or any portion thereof to become arbitrage bonds within the meaning and interpretation of the statutes of the United States of America and the regulations of the Internal Revenue Service relating to arbitrage at the time of any such reinvestment, and such reinvestments shall only be in such investments as are then permitted under applicable statutes of the State of Washington prior to the date or dates such moneys will be needed for such payment. Any moneys remaining on deposit with the Refunding Trustee after the payment and retirement in full of the outstanding 1970 Bonds on November 1, 1987, shall be transferred and paid into the Principal and Interest Account in the Bond Fund. Ail of the book entry obligations purchased as a part of the refunding plan are irrevocably dedicated to the purpose of paying the interest on the Refunding Bonds until November 1, 1987, and to the purpose of retiring and refunding the outstanding 1970 Bonds on November 1, 1987, and such investments or the earnings or the proceeds therefrom may be used for no other purpose nor may any of such investments be liquidated prior to maturity. All necessary and proper fees, compensation and expenses of the Refunding Trustee for ~%e Refunding Bonds and all other costs incidental to the refunding of the 1970 Bonds, including but not -10- limited to reasonable charges of bond counsel, bond printing and publication of this ordinance, shall be paid when due out of the principal proceeds received from the issuance of the Refunding Bonds. The proper officers of the City are directed to obtain from the Refunding Trustee an agreement setting forth the duties, obligations and responsibilities of the Refunding Trustee in connection with the redemption and retirement of the outstanding 1970 Bonds as provided herein. In order to carry out the purposes of the preceding section of this ordinance and this section, the Mayor and Clerk of the City are authorized and directed to execute and deliver to Seattle- First National Bank, Seattle, Washington, as Refunding Trustee, an agreement substantially in the form attached hereto, marked Exhibit A, and by this reference made a part of this ordinance. Section 9. Par~ing System Revenue Fund. There was heretofore created by Ordinance No. 2916 a special fund of the City known as the "City of Bremerton Parking System Revenue Fund" (herein called the "Revenue Fund"). By Ordinance No. 2916 the City covenanted and hereby renews the covenant that all of the Gross Revenues of the Parking System and all Gross Receipts from On-Street Parking Meters shall be deposited in the Revenue Fund as the same shall be collected and shall be held in the custody of the City Treasurer, separate and apart from all other funds of the City. The Revenue Fund shall be maintained for so long as the 1970 Bonds, the Refunding Bonds and any Parity Bonds are outstanding. Moneys on deposit in the Revenue Fund shall be used only for the following purposes and in the following order of priority: (1) To make all payments required to be made into the Parking Revenue Bond Fund 1970 and the Reserve Account therein to pay and secure the payment of the principal of and interest on the 1970 Bonds and any Parity Bonds until November 1, 1987, and thereafter the principal of and interest on the Refunding Bonds and any Parity Bonds. (2) To pay Current Expenses of the Parking System. (3) For any other lawful purpose of the City, including the purchase of any 1970 Bonds, Refunding Bonds or Parity Bonds. -11- Section 10. Bond Fund. There was heretofore also created by Ordinance No. 2916 another special fund of the City known as the "City of Bremerton Parking Revenue Bond Fund 1970" (hereinafter called the "Bond Fund"), which Fund shall be held separate and apart from all other funds and accounts of the City. The moneys in the Bond Fund shall be a trust fund for the security and payment of the principal of and interest on the 1970 Bonds and any Parity Bonds until November 1, 1987, and thereafter the principal of and interest on the Refunding Bonds and any Parity Bonds. All moneys credited to the Bond Fund shall be and are hereby pledged and ordered to be used for the sole purpose of paying the principal of and interest on the 1970 Bonds and any Parity Bonds until November 1, 1987, and thereafter the principal of and interest on the Refunding Bonds and any Parity Bonds. Immediately after delivery of the Refunding Bonds to the purchaser thereof, the City shall deposit in the Bond Fund all accrued interest received, if any. The City Treasurer is hereby authorized and directed and the City hereby obligates and binds itself to set aside and pay into the Bond Fund out of the Revenue Fund, including the payments to be made into the Bond Fund for the payment of the 1970 Bonds until November 1, 1987, those amounts necessary to pay the principal of and interest on the Refunding Bonds outstanding as the same respectively become due and payable. Said payments shall be made into the Bond Fund on or before the 10th day of each month in the following amounts: (a) Beginning with the month of September, 1987, and continuing for as long as any of the Refunding Bonds are outstanding and unpaid, 1/6th of the amount which will equal the interest to become due and payable on the Refunding Bonds outstanding on the next semiannual interest payment date. (b) Beginning with the month of September, .1987, and continuing for as long as any of the Refunding Bonds are outstanding and unpaid, 1/12th of the amount which will equal the principal amount of the Refunding Bonds to become due and payable on the next principal payment date. -12- Such amounts so pledged to be paid out of the Revenue Fund into the Bond Fund and the amounts hereinafter pledged to be paid into the Reserve Account created therein are hereby declared to be a first lien and charge upon the Gross Revenue of the Parking System and the Gross Receipts from On-Street Parking Meters and upon the money in such Revenue Fund superior to all other charges of any kind or nature and equal in rank to any charges which may be made later thereon to pay and secure the pala~ent of the principal of and interest on any Parity Bonds. Money in the Bond Fund may be invested in direct obligations of the United States Government, having a guaranteed redemption price or maturing at least ten (10) days prior to the time when such money is needed to pay installments of interest or principal and interest next coming due on any bonds payable out of the Bond Fund. Interest earned on or profits made from the sale of any such investments shall be deposited in and become a part of the Bond Fund. Section 11. Defeasance. In the event the City shall issue advance refunding bonds pursuant to the laws of the State of Washington, or have moneys available from any other lawful source, to pay the principal of and interest on the Refunding Bonds or such portion thereof included in the refunding plan as the same become due and payable and to refund all such then outstanding Refunding Bonds and to pay the costs of refunding, and shall have irrevocably set aside for and pledged to such payment and refunding, moneys and/or direct obligations of the United State~\of America or other legal investments sufficient in amount, together with known earned income from the investments thereof, to make such payments and to accomplish ! the refunding as scheduled, (hereinafter called the "trust account") / ~d~a~einr ~v~ l~a~eak~l~ r~°n~d ~t~P~°~h~ fo~sR~ ~unding holders of the Refunding Bonds to be so retired or refunded and the appurtenant coupons (hereinafter collectively called the "defeased Refunding Bonds") in the covenants of this ordinance, in the -13- Gross Revenue of the Parking System and the Gross Receipts from On-Street Parking Meters and funds and accounts obligated to the payment of such Refunding Bonds shall thereafter cease and become void, except such owners and holders shall have the right to receive payment of the principal of and interest on the defeased Refunding Bonds from the trust account and, in the event the funds in the trust account are not available for such payment, shall have the residual right to receive payment of the principal of and interest on the defeased Refunding Bonds from the Gross Revenue of the Parking System and the Gross Receipts from On-Street Parking Meters of the City without any priority of lien or charge against those revenues or covenants with respect thereto except to be paid therefrom. After the establishing and full funding of such trust account, the City may then apply any moneys in any other fund or account established from the payment or redemption of the defeased Refunding Bonds to any lawful purposes as it shall determine, subject only to the rights of the holders of any other bonds then outstanding. In the event that the refunding plan provides that the Refunding Bonds being refunded or the refunding bonds to be issued be secured by cash and/or direct obligations of the United States of America or other legal investments pending the prior redemption of those Refunding Bonds being refunded and if such refunding plan also provides that certain cash and/or direct obligations of the United States of America or other legal investments are irrevocably pledged for the prior redemption of those Refunding Bonds included in the refunding plan, then only the debt service on the Refunding Bonds which are not defeased Refunding Bonds and the refunding bonds, the payment of which is not so secured by the refunding plan, shall be included in t/]e computation of coverage for issuance of Parity Bonds and the annual computation of coverage for determining compliance with the rate covenants. -14- Section 12. Parkin9 Revenue Bond Reserve Account. A Parking Revenue Bond Reserve Account (herein called the "Reserve Account") was heretofore created by Ordinance No. 2619 in the Bond Fund. After the payment and retirement on November i, 1987, of the outstanding 1970 Bonds, all moneys then on deposit in the Reserve Account in the Bond Fund (being not less than the aggregate sen of $10q,738.05 ), being an amount equal to the maximum annual debt service requirements on the Refunding Bonds then outstanding, shall be retained therein and shall thereafter be maintained in such amount so that there will be on deposit within that account at all times, except for withdrawals therefrom as authorized herein, an amount at least equal to the maximum annual debt service requirements on the Refunding Bonds, provided, however, that moneys in the Reserve Account may be withdrawn to pay the last maturing bonds of any single issue or series payable out of the Bond Fund so long as the moneys left remaining in the Reserve Account are at last equal to the maximum annual debt service requirements on all of the remaining bonds payable out of the Bond Fund. In the event there shall be a deficiency in the Bond Fund to meet maturing installments of either interest on or principal of and interest on the 1970 Bonds prior to November 1, 1987, or the Refunding Bonds after November 1, 1987, or any Parity Bonds, such deficiency shall be made up from the Reserve Account by the withdrawal of cash therefrom. Any deficiency created in the Reserve Account by reason of any such withdrawal shall then be made up from the moneys in the Revenue Fund first available therefor. The moneys in the Reserve Account, to the extent practicable, shall be invested in direct obligations of the United States of America, or in agency securities of the United States of America, maturing or having a guaranteed redemption price no later than the final maturity of the bonds payable out of the Bond Fund. Interest earned on or profits made from the sale of any such investments shall be deposited in and become a part of the Bond Fund. -15- Section 13. Adequacy o.f Revenue. The corporate authorities of the City hereby declare that in fixing the amounts to be paid into the Bond Fund and the Reserve Account as hereinbefore provided, they have exercised due regard to the costs of maintenance and operation of the Parking System and have not obligated the City to set aside and pay into said Fund and Account a greater amount of the Gross Revenues of the Parking System and the Gross Receipts from On-Street Parking Meters than in their judgment will be available over and above such costs of maintenance and operation. Section 14. Specific Covenants. The City hereby covenants and agrees with the owner and holder of each of the Refunding Bonds for as long as the same remain outstanding as follows: (a) That it will establish, maintain and collect fees, tolls, rates, rentals and other charges for the use of the Parking System, which, together with the Gross Receipts from On-Street Parking Meters, will make available annually for the payment of the principal of and interest on the outstanding 1970 Bonds until November 1, 1987, and thereafter on the Refunding Bonds as the same shall become due an amount equal to at least 1.5 times the average annual debt service on such outstanding 1970 Bonds or Refunding Bonds, as the case may be, after payment of Current Expenses. (b) That it will at all times keep and maintain the Parking System in good repair, working order and condition and will at all times operate the Parking System and the business in connection therewith in an efficient manner and at a reasonable cost. (c) That it will not sell or otherwise dispose of any of the properties of the Parking System (unless the same are no longer used, useful or necessary in the operation thereof and in the producing of revenue required to meet the obligations of the City payable out of such revenue), unless provision is made for payment into the Bond Fund of a sum sufficient to redeem ~d retire all of the Refunding Bonds then outstanding in accordance with the terms thereof. (d) That it will not furnish parking to any customer whatsoever free of charge. (e) That it will at all times establish, maintain and enforce on-street parking regulations designating the places at which street parking meters are to be located and relating to parking at such places, will install parking meters in all streets or portions thereof within said City as to which such regulations apply, will maintain all such parking meters in good operating condition and will replace such parking meters as are required. The City further covenants -16- and agrees that it will collect parking meter fees on all streets or portions thereof within the City as to which the aforementioned regulations apply and on which such parking laeters are so installed. Nothing in this ordinance shall be construed to prohibit or prevent the installation of new parking meters in places where parking meters are not now located nor to prohibit or prevent the removal or relocation of any parking meters now or hereafter installed when such removal or relocation is made necessary by reason of public safety or convenience, by reason of street widening or street closing or by reason of traffic control. (f) That it will carry fire and extended coverage insurance on the Parking System, as is ordinarily carried on similar facilities by private companies engaged in the operation of the same, to the full insurable value and will also carry adequate public liability insurance and other kinds of insurance, as under good practice are ordinarily carried on properties of similar nature by private companies engaged in the operation of the same. The premiums paid for all such insurance shall be regarded and paid as a Current Expense of the Parking System. (g) That it will keep and maintain proper books and accounts with respect to the operations, income and expenditures of the Parking System and the Gross Receipts from On-Street Parking Meters that are in accordance with proper and legal accounting procedures. That on or before sixty (60) days after each fiscal year of the City's operation of the Parking System, it will prepare or cause to be prepared an operating statement of the Parking System including the Gross Receipts from On- Street Parking Meters for such preceding fiscal year. Each such statement shall contain a statement in detail of the Gross Revenues of ~e Parking System, the Current Expenses of the Parking System, the Gross Receipts from On-Street Parking Meters, and expenditures for capital purposes of the Parking System for such fiscal year; shall contain a balance sheet as of the end of such year, showing the status of all Funds and Accounts created by Ordinance No. 2916, and shall contain a list of the insurance policies in force at the end of such fiscal year, setting out the amount of each policy, the risks covered thereby and the name of the insurer and the expiration date of such policies. Copies of such statements shall be placed on file in the office of the City Clerk and shall be sent to Wm. P. Harper & Son & Company and Blyth & Co., Inc., at their main offices in Seattle, Washington, until the 1970 Bonds are redeemed and retired on November 1, 1987, and to First Washington Corporation at its main office in Seattle, Washington, and shall be open to inspection at any reasonable time by the holder of any of the 1970 Bonds and/or the Refunding Bonds. Ail expenses incurred in the making of such statements shall be regarded and paid as a Current Expense of the Parking System. (h) That it will make no use of the proceeds of the Refunding Bonds or other funds of the City at any time during the term of the Refunding Bonds which, if such use had been reasonably expected at the date that the -17- Refunding Bonds are issued, would have caused such Refunding Bonds to be arbitrage bonds within the meaning of Section 103(d) of the United States Internal Revenue Code of 1954, and for this purpose it further covenants that none of such proceeds will be used to acquire obligations the adjusted yield on which will exceed the adjusted yield produced by the Refunding Bonds, both such adjusted yields being computed pursuant and subject to the requirements and exceptions of Sections 1.103-13 and 1.103-14 of the regulations of the United States Treasury Depart- ment published in the Federal Register on May 3, 1973, December 3, 1975, and October 29, 1976. The covenants of this section appertaining to the Refunding Bonds shall be subject to all provisions concerning payment and to all other contractual provisions in the proceedings authorizing the issuance of the outstanding 1970 Bonds or otherwise appertaining thereto. Section 15. Issuance of Parity Bonds. The City hereby further covenants and agrees with the owner and holder of each of the Refunding Bonds for as long as the same remain outstanding, in the same manner as it covenanted in Section 14 of Ordinance No. 2916 pertaining to the 1970 Bonds, that it will not issue any Parity Bonds except - A. That the City reserves the right: First: For the purpose of acquiring, constructing and installing, additions, betterments and improvements to and extensions of, acquiring necessary equipment for making necessary replace- ments or repairs or capital improvements to the Parking System, or Second: For the purpose of refunding by exchange or purchasing and retiring at or prior to their maturity any outstanding revenue bonds or revenue coupon warrants of the City that may have a lien on the moneys in the Revenue Fund for the payment of the principal thereof and interest thereon junior and inferior to the lien on such moneys for the payment of the principal of and interest on the Refunding Bonds. To issue additional and/or refunding revenue bonds therefor (herein called "Parity Bonds"), and to pledge that payments shall be made out of the Revenue Fund to pay and secure the payment of the principal of and interest on such Parity Bonds on a parity with the payments required to be made out of such Revenue Fund to pay and -18- secure the payment of the principal of and interest on the 1970 Bonds prior to their retirement on November 1, 1987, and the Refunding Bonds after November 1, 1987, upon compliance with the following conditions: (1) That at the time of the issuance of such Parity Bonds there is no deficiency in the Parking Revenue Bond Fund 1970 or the Reserve Account created therein. (2) That the City will covenant in each ordinance authorizing the issuance of Parity Bonds that for as long as any of the 1970 Bonds, Refunding Bonds and any Parity Bonds are outstanding it will establish, maintain and collect fees, tolls, rates, rentals and other charges for the use of the Parking System which, together with the Gross Receipts from On-Street Park- ing Meters, will make available annually for the pay- ment of the principal of and interest on all outstanding Parity Bonds and on all of the outstanding 1970 Bonds until November 1, 1987, and interest on the Refunding Bonds as the same shall become due an amount equal to at least 1.5 times the average annual amount required there- after for the payment of all of such principal and interest after Current Expenses of the Parking System have been paid. (3) That the City will covenant in each ordinance authorizing the issuance of Parity Bonds that it will pay into and maintain in the Reserve Account created by Section 11 of Ordinance No. 2916 out of the moneys in the Revenue Fund and out of any other moneys legally available therefor an amount equal to 1/60th of the amount, which, together with the amounts deposited in the Account as reserves for previously issued bonds and Parity Bonds, will be at least equal to the maximum annual debt service on all outstanding bonds payable from the Bond Fund, including the Parity Bonds to be issued. (4) That the City shall have on file a certificate from a qualified Parking Garage Consultant or a Consulting Engineer experienced in the planning, development and operation of parking garages, dated not more than ninety (90) days prior to the date of issuance of such Parity Bonds, stating that the Net Revenue of the Parking System, plus the Gross Receipts from On-Street Parking Meters, plus income from Reserve Account investments, plus his estimate of the annual net revenues to be derived from new parking facilities to be financed in whole or in part from the proceeds of the Parity Bonds to be issued, will in each year following the year of completion of such new facilities equal at least 1.75 times the average annual debt service requirements on the outstanding 1970 Bonds until November 1, 1987, and thereafter on the Refunding Bonds, any outstanding Parity Bonds and the Parity Bonds to be issued. Such Net Revenue of the Parking System and Gross Receipts from On-Street Parking Meters shall be adjusted to reflect the park- ing and meter rates and charges effective on the date of such certificate in the event there has been any change in such rates and charges during or after such twelve (12) month period. -19- B. That t/~e City further reserves the right to issue Parity Bonds for the purpose of refunding by exchange for purchasing or retiring at-or prior to their maturity an equal principal amount of any part or all of the Refunding Bonds and/or any Parity Bonds outstanding and to pledge that payment shall be made out of the Revenue Fund to pay and secure the payment of the principal of and interest on such refunding Parity Bonds on a parity with the payments required to be made out of such Fund to pay and secure the payment of the principal of and interest on the Refunding Bonds upon compliance with subparagraphs (1), (2) and (3) of subsection A of this Section. If the issuance of such refunding Parity Bonds and the retirement of outstanding bonds does not require a greater amount to be paid out of the Revenue Fund in any calendar year thereafter for the principal of and interest on such refunding Parity Bonds than was required to be paid out of such revenue in each of the same calendar years for the payment of the principal of and interest on the bonds being refunded, and any premiums paid to effect such refunding shall not be computed in determining such annual amounts. C. Nothing herein contained shall prevent the City from issuing revenue bonds or warrants (coupon or otherwise), the payment of the principal of and interest on which is made a charge upon the Revenue Fund junior or inferior to the payments required to be made out of such Fund into the Bond Fund and the Reserve Account. Section 16. Sale of Bonds. The action of the City Council in accepting the written offer of First Washington Corporation of Seattle, Washington, dated October 27, 1976, to purchase the Refunding Bonds under the terms, conditions and covenants thereof as set forth herein and at the price set forth in said offer is hereby in all respects ratified and confirmed. The City officials are hereby authorized and directed to do all things necessary for the prompt issuance, execution and -20- delivery of the Refunding Bonds to the purchaser thereof and for the proper use and application of the moneys derived from such sale. Section 17. Tem~o~aNy Bond. Pending the printing, execution and delivery to the purchaser of the definitive B~fu~ing Bonds, the City may cause to be executed and delivered to such purchaser a single temporary Refunding Bond in the principal amount of $755,000.00. Such temporary Refunding Bond shall bear the same date of issuance, interest rate, principal payment dates and terms and covenants as the definitive Refunding Bonds, and shall be i~ued as a fully registered bond in the name of such purchaser, and sh~ll be in such form as acceptable to such purchaser. Such temporary Refunding Bond shall be exchanged for the definitive Refunding Bonds as soon as t~e same are printed, executed and available for delivery. Section 18. Effective Date. For the reason that it is necessary that the City obtain the proceeds of sale of the Refunding Bonds as soon as possible in order to purchase the book entry obligations and maximize the savings to the City from the refunding operation, an emergency is hereby declared to exist, and it is h~reby found necessary for the public health, welfare and safety that this ordinance become effective immediately upon its passage, approval and publication. PASSED UNANIMOUSLY by the City Council of the City of Bremerton, Washington, at a regular open public meeting thereof, signed by the Mayor, and attested by the City Clerk in authentication of such passage, this 8th day of December, 1976. ~ CITY OF BREMERTON,~WASH~i~ ~ Mayor Ci~ Clerk APPROVED AS TO FORM: -21- A G R E E M E N T THIS AGREemENT made and entered into as of the ~/Fday of December, 1976, by and between the CITY OF BR~4ERTON, WASHINGTON, a municipal corporation of the State of Washington (the "City"), and SEATTLE-FIRST NATIONAL BANK, Seattle, Washington (the "Refunding Trustee"); WITNESS ETH: SECTION 1. Recitals. The City heretofore issued and sold its "City of Bremerton Parking Revenue Bonds," dated November 1, 1970, (the "1970 Bonds") pursuant to Ordinance No. 2916 of the City. Pursuant to said Ordinance No. 2916 the City in the manner provided therein may provide for the refunding prior to maturity of the 1970 Bonds at various redemption prices on varying interest payment dates. The City by Ordinance No.33~ passed by the City Council and approved by the Mayor on December 8, 1976, has determined to refund on November 1, 1987, all of the 1970 Bonds maturing after November 1, 1987, in accordance with the terms of said Ordinance No. 2916 out of the proceeds of sale of its "City of Bremerton Parking Revenue " (the "Refunding Bonds") Refunding Bonds, 1976, . SECTION 2. Provisions for Refunding the 1970 Bonds. To accompliSh the refunding of the 1970 Bonds, the City, simultaneously with the delivery of the Refunding Bonds issued pursuant to said Ordinance No.332~, does hereby agree to irrevocably deposit with the Refunding Trustee in trust for the security and benefit of the holders and owners of the 1970 Bonds and the Refunding Bonds, obligations of the United States of America ("Obligations"), being $750,000.00 par value of United States Treasury Certificates of Indebtedness, Notes and Bonds - State and Local Government Series (commonly called "book entry obligations") due November 1, 1987, EXHIBi'[ :A and bearing interest at the rate of 7_3~% per annum, which, together with the investment income therefrom, will be sufficient to provide for the payment of (1) the interest on the Refunding Bonds becoming due and payable on or before November 1, 1987, and (2) the redemption price payable on November 1, 1987, upon the redemption of the 1970 Bonds maturing after such date. On or before the delivery of the Refunding Bonds the City agrees that it will cause to be delivered to the Refunding Trustee a statement setting forth the amount of interest to be paid on each semiannual interest payment date on the Refunding Bonds up through November 1, 1987, and the amount of the principal and call premium required on November 1, 1987, to pay and redeem all then outstanding 1970 Bonds. The City by said Ordinance No. ~32~has irrevocably called for redemption or prepayment on November 1, 1987, the 1970 Bonds maturing after such date. Said call for redemption or prepayment shall be irrevocable upon the delivery of the Refunding Bonds. The Refunding Trustee, through the City Clerk, shall provide for publication of the proper notice of such redemption or prepayment in accordance with the applicable provisions of Ordinance No. 2916 pertaining to the 1970 Bonds. Provision for the giving of such notice of redemption or prepayment has irrevocably been made by the City. SECTION 3. Disbursements by the Refunding Trustee.' The Refunding Trustee shall present for payment on the due date thereof the Obligations so deposited and shall apply the proceeds derived therefrom in accordance with the provisions of this section. Monies shall be transferred by the Refunding Trustee to the City Treasurer in amounts sufficient'to pay the interest on the Refunding Bonds becoming due and payable on or before November 1, 1987. Monies shall be transferred by the Refunding Trustee to the City Treasurer in amounts sufficient to pay on November 1, 1987, the redemption price with respect to the 1970 Bonds maturing after such date. SECTION 4. Investment of Funds; Custody and Safekeeping of Obligations. Any monies deposited with the Refunding Trustee or received by the Refunding Trustee as maturing principal or interest on Obligations prior to the time required to make the payments hereinbefore set forth shall be promptly invested and reinvested whenever warranted by the Refunding Trustee in noncallable obligations of the United States of America, maturing as to principal and interest in such amounts and at such times as to provide for the payments hereinbefore required to be made, only if any such investment or reinvestment does not in any manner cause the Refunding Bonds or any portion thereof to become arbitrage bonds within the meaning and interpretation of the Statutes of the United States of America and the regulations of the Internal Revenue Service relating to arbitrage at the tim~ of any such investment or reinvestment. Ali income derived from the Obligations and reinvestment of any monies deposited with the Refunding Trustee pursuant to Section 2 hereof in the hands of the Refunding Trustee (which monies are not required to make the payments hereinbefore required to be made) shall be paid to the City Treasurer for the credit of the Parking Revenue Bond Fund 1970 created by Section 9 of Ordinance No. 2916 of the City (hereinafter called the "Bond Fund") as and when realized and collected for use and application as other monies deposited in said Bond Fund. For as long as any of the 1970 Bonds are outstanding, on or before the 10th day of each March and September, commencing with the month of March, 1977, the Refunding Trustee shall render a statement as of the first day of each of such months to the City EXHIBIT Treasurer, which statement shall set forth the Obligations held by the Refunding Trustee, a list of any investments or reinvestments made by the Refunding Trustee in noncallable obligations of the United States of America, if any, the amount of interest derived from such Obligations and principal and interest derived from such investments or reinves%ments, if any, the amounts paid to such Treasurer for credit to the Bond Fund, and the dates of such payment, for the payment of the interest on the Refunding Bonds as the same shall become due and/or payable, and the final maturity of such Obligations and the final payment of the redemption price for the 1970 Bonds on November 1, 1987, and any other transactions of the Refunding Trustee pertaining to its duties and obligations as set forth herein. The Refunding Trustee shall not be liable for any depreciation in value of any investment of monies so deposited with the Refunding Trustee. All Obligations, monies and investment income deposited with or received by the Refunding Trustee pursuant to this Agreement shall be subject to the trust created by this Agreement and the Refunding Trustee shall be liable for the preservation and safekeeping thereof. SECTION 5. Duties and Obligations of Refunding Trustee.' The duties and obligations of the Refunding Trustee shall be as prescribed by the provisions of this Agreement, and the Refunding Trustee shall not be liable except for the performance of its duties and obligations as specifically set forth herein and to act in good faith in the performance thereof and no implied duties or obligations shall be incurred by such Refunding Trustee other than those specified herein. The Refunding Trustee may consult with counsel of its [XHIBIT A choice and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or not taken or suffered by it hereunder in good faith and in accordance with the opinion of such counsel. Provisions for the fees, compensation and expenses of the Refunding Trustee satisfactory to it have been made. CITY OF BREMERTON, WASHINGTON ATTEST: ~' ~ity C'lerk ' ' SEATTLE-FIRST NATIONAL BANK By Vice President and Trust Officer EXHIBIT A - 5 - I, G. C. YEADON, SR., City Clerk of the City of Bremerton, Washington, do hereby certify that the attached copy of Ordinance No.~ is a true and correct copy of the original ordinance passed on the 8th day of November, 1976, as said ordinance appears on the Minute Book of the City. DATED this-- ~7~'~ day of December, 1976. G.C. EATON, SR., City Clerk