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HomeMy WebLinkAbout5214 CITY OF BREMERTON, WASHINGTON ORDINANCE NO 5214 AN ORDINANCE of the City of Bremerton, Washington, providing for the issuance and sale of two series of limited tax general obligation refunding bonds in the aggregate principal amount of not to exceed $14,500,000 for the purpose of currently refunding certain outstanding debt, and delegating authority to the Mayor or Director of Financial Services to approve the final terms of the bonds Passed April 17, 2013 This document prepared by Foster Pepper PLLC 1111 Third Avenue, Suite 3400 Seattle, Washington 98101 (206) 447 -4400 512808523 TABLE OF CONTENTS Page Section 1 Definitions 1 Section 2 Recitals and Findings 3 Section 3 Debt Capacity 4 Section 4 Purpose and Authorization of Bonds 4 Section 5 Description of Bonds 4 Section 6 Bond Registrar, Registration and Transfer of Bonds 5 Section 7 Form and Execution of Bonds 6 Section 8 Payment of Bonds 6 Section 9 Redemption Provisions and Open Market Purchase of Bonds 7 Section 10 Failure To Redeem Bonds 8 Section 11 Pledge of Taxes 8 Section 12 Tax Matters 9 Section 13 Refunding or Defeasance of the Bonds 9 Section 14 Bond Funds and Deposit of Bond Proceeds 10 Section 15 Undertaking to Provide Continuing Disclosure 10 Section 16 Sale of Bonds 13 Section 17 Official Statement 14 Section 18 Supplemental Ordinances 14 Section 19 General Authorization and Ratification 14 Section 20 Severabilrty 14 Section 21 Effective Date of Ordinance 15 512808523 CITY OF BREMERTON, WASHINGTON ORDINANCE NO 5214 AN ORDINANCE of the City of Bremerton, Washington, providing for the issuance and sale of two series of limited tax general obligation refunding bonds in the aggregate principal amount of not to exceed $14,500,000 for the purpose of currently refunding certain outstanding debt, and delegating authority to the Mayor or Director of Financial Services to approve the final terms of the bonds THE CITY COUNCIL OF THE CITY OF BREMERTON, WASHINGTON, DO ORDAIN AS FOLLOWS Section 1 Definitions As used in this ordinance, the following words shall have the following meanings "Authorized Denomination" means $5,000 or any integral multiple thereof within a maturity "Beneficial Owner" means the owner of any beneficial interests in the Bonds "Bond Counsel" means a firm of lawyers nationally recognized and accepted as bond counsel and so employed by the City for any purpose under this ordinance applicable to the use of that term "Bond Funds" means, together, the 2013A Bond Fund and the 2013B Bond Fund "Bond Purchase Contract" means an agreement between the City and the Underwriter providing for the purchase of the Bonds by the Underwriter "Bond Register" means the books or records maintained by the Bond Registrar for the purpose of identifying ownership of the Bonds "Bond Registrar" means the Fiscal Agent "Bonds" means, together, the 2013A Bonds and the 2013B Bonds "City" means the City of Bremerton, Washington, a municipal corporation duly organized and existing under the laws of the State "City Council" means the governing body of the City, acting in its legislative capacity "Code" means the United States Internal Revenue Code of 1986, as amended, and applicable rules and regulations promulgated thereunder "Designated Representative" means the officer or employee of the City appointed in Section 16 of this ordinance to serve as the City's designated representative in accordance with RCW 39 46 040(2) for purposes of accepting, on behalf of the City, an offer to purchase the Bonds on terms consistent with this ordinance and the parameters set forth herein "DTC" means The Depository Trust Company, New York, New York "Fiscal Agent" means the fiscal agent of the State, as the same may be designated by the State from time to time "Issue Date" means the date of initial delivery of the Bonds to the Underwriter "Letter of Representations" means the Blanket Issuer Letter of Representations dated November 19, 1997, between the City and DTC, as it may be amended from time to time "MSRB" means the Municipal Securities Rulemakmg Board "Note" means the Limited Tax General Obligation Bond Anticipation Note, 2011, in the principal amount not to exceed $9,675,000, issued pursuant to the Note Ordinance "Note Fund" means the "Limited Tax General Obligation Bond Anticipation Note Fund" created by the Note Ordinance "Note Ordinance" means Ordinance No 5152 authorizing the issuance of the Note "Owners" means, without distinction, the Registered Owner(s) and the Beneficial Owner(s) "Registered Owner" means the person in whose name a Bond is registered on the Bond Register For so long as the City utilizes the book —entry system for the Bonds under the Letter of Representations, Registered Owner shall mean DTC "Revenues of the Golf Course" means all the earnings and revenue received by the Gold Mountain Golf Complex from any source whatsoever, except general ad valorem taxes, grants from the state or federal governments and bond proceeds "Revenues of the Parking Garage" means all the earnings and revenue received by the parking facility associated with the Kitsap Regional Conference Center from any source whatsoever, except general ad valorem taxes, grants from the state or federal governments and bond proceeds "Rule 15c2 -12" means Rule 15c2 -12 promulgated by the SEC under the Securities Exchange Act of 1934, as amended "SEC" means the United States Securities and Exchange Commission "State" means the State of Washington 2 512808523 "Term Bonds" mean those Bonds of any principal maturity that are subject to mandatory redemption or for which mandatory sinking fund payments are required "2009 Bond" means the City's Limited Tax General Obligation Bond, 2009 issued pursuant to the 2009 Bond Ordinance "2009 Bond Ordinance" means Ordinance No 5087 authorizing the issuance and purchase of the 2009 Bond "2013A Bond Fund" means the Limited Tax General Obligation Refunding Bond Fund, 2013A, created by this ordinance for the payment of the 2013A Bonds "2013A Bonds" means the Limited Tax General Obligation Refunding Bonds, 2013A, authorized to be issued by this ordinance "2013B Bond Fund" means the Limited Tax General Obligation Refunding Bond Fund, 2013B (Taxable), created by this ordinance for the payment of the 2013B Bonds "2013B Bonds" means the Limited Tax General Obligation Refunding Bonds, 2013B (Taxable), authorized to be issued by this ordinance "Undertaking" means the continuing disclosure agreement set forth in Section 15 of this ordinance "Underwriter" means D A Davidson & Co of Seattle, Washington Section 2 Recitals and Findings (a) Pursuant to the 2009 Bond Ordinance, the City issued and the Sewer Fund of the City purchased the 2009 Bond for the purpose of refunding certain limited tax general obligation bonds originally issued to finance certain improvements to the City's Mountain Golf Complex The 2009 Bond is currently outstanding in the principal amount of $5,058,000 and matures on December 31, 2028 The City reserved the right to prepay the Bond in whole or in part at any time (b) Pursuant to the Note Ordinance, the City issued the Note for the purpose of refunding certain revenue bonds originally issued to finance the costs of constructing and equipping a parking garage The Note is currently outstanding in the principal amount of $8,910,000 and matures on July 29, 2013 The City reserved the right to prepay the Note in whole or in part at any time by paying the principal amount thereof to be prepaid together with accrued interest to the date of prepayment (c) After due consideration, it appears to the City Council that the Note may be repaid by the issuance and sale of the 2013A Bonds The City Council also determines that the 2009 Bond may be prepaid by the issuance and sale of the 2013B Bonds (d) The City Council deems it to be in the best interests of the City to issue and sell the 2013A Bonds to pay the costs of repaying the Note and the costs of issuance and sale 3 512808523 of the 2013A Bonds, and to issue and sell the 2013B Bonds to pay the costs of prepaying the 2009 Bond and the costs of issuance and sale of the 2013B Bonds Section 3 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 2013 is $2,394,781,600 (a) As of March 1, 2013, the City had outstanding general indebtedness as follows (i) Limited tax general obligation bonds, notes and conditional sales contracts outstanding in the principal amount of $22,978,000, which is incurred within the limit of up to 1' /2% of the value of the taxable property within the City permitted for general municipal purposes (ii) Unlimited tax general obligation bonds outstanding in the principal amount of $9,775,000 The debt described in this paragraph is incurred with the approval of the requisite number of the City's qualified voters, within the limit of up to 2%2% of the value of the taxable property within the City for general municipal purposes (when combined with the outstanding limited tax general obligation indebtedness) (b) The maximum amount of indebtedness authorized by this ordinance is $14,500,000 and is issued within the limitation permitted for general municipal purposes without a vote Section 4 Purpose and Authorization of Bonds Pursuant to the parameters described in Section 16, the City is authorized to borrow money on the credit of the City and issue negotiable limited tax general obligation bonds evidencing that indebtedness in two series, in the aggregate principal amount of not to exceed $14,500,000 The 2013A Bonds shall be issued in the principal amount of not to exceed $9,150,000 for the purpose of repaying the Note and paying the costs of issuance of the 2013A Bonds The 2013B Bonds shall be issued in the principal amount of not to exceed $5,350,000 for the purpose of prepaying the 2009 Bond and paying the costs of issuance of the 2013B Bonds Section 5 Description of Bonds The 2013A Bonds shall be called the City of Bremerton, Washington, Limited Tax General Obligation Refunding Bonds, 2013A, and the 2013B Bonds shall be called the City of Bremerton, Washington, Limited Tax General Obligation Refunding Bonds, 2013B (Taxable) The Bonds shall be dated the Issue Date, shall be in Authorized Denominations, and shall be numbered separately in the manner and with any additional designation as the Bond Registrar deems necessary for purposes of identification The Bonds shall bear interest (computed on the basis of a 360 -day year of twelve 30 -day months) payable semiannually to the maturity or earlier redemption of the Bonds, and shall mature in the years and amounts and bear interest at the rates per annum as shall be determined pursuant to Section 16 4 512808523 Section 6 Bond Registrar, Registration and Transfer of Bonds (a) Registration 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 (b) 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 Register shall contain the name and mailing address of the Registered Owner of each Bond and the principal amount and number of each of the Bonds held by each Registered Owner The Bond Registrar is authorized, on behalf of the City, to authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of the Bonds and this ordinance, to serve as the City's paying agent for the Bonds and to carry out all of the Bond Registrar's powers and duties under this ordinance The Bond Registrar shall be responsible for its representations contained in the Bond Registrar's Certificate of Authentication on the Bonds The Bond Registrar may become either a Registered or Beneficial 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 Beneficial Owners 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 series, 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 (c) DTC and the Book Entry System 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 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 of any 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 Beneficial Owners Registered ownership of such Bonds, or any portions thereof, may not thereafter be transferred except (1) to any successor of DTC or its nominee, if that successor shall be qualified under any applicable laws to provide the services 5 512808523 proposed to be provided by it, (n) 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 (n) the City determines 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 7 Form and Execution of Bond 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 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 Refunding Bonds, 2013[A/B (Taxable)], described in the Bond Ordinance " The authorized signing of a Certificate of Authentication shall be conclusive evidence that the Bond so authenticated has been duly executed, authenticated and delivered and is entitled to the benefits of this ordinance If any officer whose manual or 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 manual or 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 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 8 Payment of Bonds Both principal of and interest on the Bonds shall be payable in lawful money of the United States of America 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 of Representations If the Bonds cease to be in book -entry-only form, 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 by electronic transfer on the interest payment date The City shall not be required to make 6 512808523 electronic transfers except to a Registered Owner of Bonds pursuant to a request in writing (and at the sole expense of that Registered Owner) received at least 10 days before an 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 Section 9 Redemption Provisions and Open Market Purchase of Bonds (a) Optional Redemption The Designated Representative may designate certain maturities of the Bonds as being subject to redemption at the option of the City prior to their respective maturities at the prices set forth in the Bond Purchase Contract The Designated Representative may also designate certain maturities of each series of the Bonds as not being subject to redemption prior to maturity Notwithstanding the foregoing provisions of this subsection, if the final maturity of a series of Bonds is more than 10% years after the Issue Date, the Bonds of such series then outstanding shall be subject to optional redemption on at least one date that occurs less than 10' /2 years after the Issue Date (b) Mandatory Redemption The Designated Representative may approve the designation of certain maturities of the Bonds as Term Bonds (c) Partial Redemptions Portions of the principal amount of any Bond, in any Authorized Denomination, 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, a new Bond (or Bonds, at the option of the Registered Owner) of the same series, maturity and interest rate in any Authorized Denomination in the aggregate principal amount remaining unredeemed (d) Selection of Bonds for Redemption If fewer than all of the outstanding Bonds within a maturity are to be redeemed prior to maturity, Bonds shall be selected for redemption randomly within a maturity in such manner as the Bond Registrar shall determine 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 (e) Notice of Redemption While the Bonds are held by DTC in book -entry only form, 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 form unless waived by any Registered Owner of the Bonds to be redeemed, 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 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 Registered or Beneficial Owner of any 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 7 5128085? 3 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 In addition, the redemption notice shall be mailed or sent electronically within the same period to the MSRB, consistent with the Undertaking, to any nationally recognized rating agency which at the time maintains a rating on the Bonds at the request of the City, and to such other persons and with such additional information as the Director of Financial Services shall determine, but these additional mailings shall not be a condition precedent to the redemption of Bonds (f) Effect of Redemption Interest on Bonds called for redemption shall cease to accrue on the date fixed for redemption, unless the notice of redemption is rescinded as set forth above (g) Open Market Purchase 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 (h) Cancellation of Bonds All Bonds purchased or redeemed under this section shall be canceled Section 10 Failure To Redeem Bonds If any Bond is not redeemed when properly presented at its maturity or date set for redemption, the City shall be obligated to pay interest on that Bond at the same rate provided in the Bond from and after its maturity or date set for redemption until that Bond, both principal and interest, is paid in full or until sufficient money for its payment in full is on deposit in the Bond Funds and the Bond has been called for payment by giving notice of that call to the Registered Owner Section 11 Pledge of Taxes (a) General Pledge 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 The full faith, credit and resources of the City are pledged irrevocably for the annual levy and collection of those taxes and the prompt payment of that principal and interest (b) Revenues of the Parking System In addition to the pledge of property taxes, the City hereby pledges the Revenues of the Parking System to the payment of the 2013A Bonds (c) Revenues of the Golf Course In addition to the pledge of property taxes, the City hereby pledges the Revenues of the Golf Course to the payment of the 2013B Bonds 8 512808523 Section 12 Tax Matters (a) Preservation of Tax Exemption for Interest on 2013A Bonds The City covenants that it will take all actions necessary to prevent interest on the 2013A 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 2013A Bonds or other funds of the City treated as proceeds of the 2013A Bonds at any time during the term of the 2013A Bonds which will cause interest on the 2013A Bonds to be included in gross income for federal income tax purposes The City also covenants that it will, to the extent the arbitrage rebate requirements of Section 148 of the Code are applicable to the 2013A Bonds, take all actions necessary to comply (or to be treated as having complied) with those requirements in connection with the 2013A 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 2013A Bonds from being included in gross income for federal income tax purposes (b) Designation of 2013A Bonds as "Qualified Tax - Exempt Obligations " The City has determined and certifies that (a) the 2013A 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 of the City) will issue during the calendar year in which the 2013A Bonds are issued will not exceed $10,000,000, and (c) the amount of tax - exempt obligations, including the 2013A 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 $10,000,000 The City designates the 2013A Bonds as "qualified tax - exempt obligations" for the purposes of Section 265(b)(3) of the Code Section 13 Refunding or Defeasance of the Bonds The City may issue refunding bonds pursuant to the laws of the State 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 of the 9 512808523 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 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 of redemption of Bonds Section 14 Bond Funds and Deposit of Bond Proceeds (a) 2013A Bond Fund The 2013A Bond Fund is hereby created and established in the office of the Director of Financial Services as a special fund designated the Limited Tax General Obligation Refunding Bond Fund, 2013A, for the purpose of paying principal of and interest on the 2013A Bonds All taxes, Revenues of the Parking Garage and other amounts allocated to the payment of the principal of and interest on the 2013A Bonds shall be deposited in the 2013A Bond Fund (b) 2013B Bond Fund The 2013B Bond Fund is hereby created and established in the office of the Director of Financial Services as a special fund designated the Limited Tax General Obligation Refunding Bond Fund, 2013B (Taxable), for the purpose of paying principal of and interest on the 2013B Bonds All taxes, Revenues of the Golf Course and other amounts allocated to the payment of the principal of and interest on the 2013B Bonds shall be deposited in the 2013B Bond Fund (c) 2013A Bond Proceeds Proceeds of the 2013A Bonds shall be deposited in the Note Fund and used on the Issue Date to repay the Note and pay the costs of issuing the 2013A Bonds Proceeds of the 2013A Bonds remaining after repayment of the Note and costs of issuing the 2013A Bonds shall be deposited in the 2013A Bond Fund and used to pay debt service on the 2013A Bonds (d) 2013B Bond Proceeds Proceeds of the 2013B Bonds shall be used on the Issue Date to prepay the 2009 Bond and pay the costs of issuing the 2013B Bonds Proceeds of the 2013B Bonds remaining after prepaying the 2009 Bond and costs of issuing the 2013B Bonds shall be deposited in the 2013B Bond Fund and used to pay debt service on the 2013B Bonds Section 15 Undertaking to Provide Continuing Disclosure To meet the requirements of paragraph (b)(5) of Rule 15c2 -12, as applicable to a participating underwater for the Bonds, the City makes the following written Undertaking for the benefit of Beneficial Owners of the Bonds (a) Undertaking to Provide Annual Financial Information and Notice of Listed Events The City undertakes to provide or cause to be provided, either directly or through a designated agent, to the MSRB, in an electronic format as prescribed by the MSRB, accompanied by identifying information as prescribed by the MSRB 10 512808523 (i) Annual financial information and operating data of the type included in the final official statement for the Bonds and described in subsection (b) of this section ( "annual financial information "), (u) Timely notice (not in excess of 10 business days after the occurrence of the event) of the occurrence of any of the following events with respect to the Bonds (1) principal and interest payment delinquencies, (2) non- payment related defaults, if material, (3) unscheduled draws on debt service reserves reflecting financial difficulties, (4) unscheduled draws on credit enhancements reflecting financial difficulties, (5) substitution of credit or liquidity providers, or their failure to perform, (6) adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notice of Proposed Issue (IRS Form 5701 — TEB) or other material notices or determinations with respect to the tax status of the Bonds, (7) modifications to rights of holders of the Bonds, if material, (8) bond calls (other than scheduled mandatory redemptions of Term Bonds), if material, and tender offers, (9) defeasances, (10) release, substitution, or sale of property securing repayment of the Bonds, if material, (11) rating changes, (12) bankruptcy, insolvency, receivership or similar event of the City, as such "Bankruptcy Events" are defined in Rule 15c2 -12, (13) the consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material, and (14) appointment of a successor or additional trustee or the change of name of a trustee, if material (iii) Timely notice of a failure by the City to provide required annual financial information on or before the date specified in subsection (b) of this section (b) Type of Annual Financial Information Undertaken to be Provided The annual financial information that the City undertakes to provide in subsection (a) of this 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 State local governmental units such as the City, 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) outstanding general obligation bonds, (3) assessed valuation for the fiscal year, (4) regular property tax levy rate and regular property tax levy rate limit for the fiscal year, and (5) general fund revenues from other mayor tax sources, (u) Shall be provided not later than the last day of the ninth month after the end of each fiscal year of the City (currently, a fiscal year ending 11 512808523 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, 2013, 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 Rule 15c2 -12 The City will give notice to the MSRB of the substance (or provide a copy) of any amendment to the Undertaking and a brief statement of the reasons for the amendment If the amendment changes the type of annual financial information to be provided, the annual financial information containing the amended financial information will include a narrative explanation of the effect of that change on the type of information to be provided (d) Beneficiaries The Undertaking evidenced by this section shall inure to the benefit of the City and any Beneficial Owner 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 Rule 15c2 -12 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 counsel or 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 of any 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 Beneficial Owner of a Bond shall be to take such actions as that Beneficial Owner 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 Director of Financial Services 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, 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 Rule 15c2 -12, including, without limitation, the following actions (i) Preparing and filing the annual financial information undertaken to be provided, 12 512808523 (u) Determining whether any event specified in subsection (a) has occurred, assessing its materiality, where necessary, with respect to the Bonds, and preparing and disseminating any required notice of its occurrence, (iii) Determining whether any person other than the City is an "obligated person" within the meaning of Rule 15c2 -12 with respect to the Bonds, and obtaining from such person an undertaking to provide any annual financial information and notice of listed events for that person in accordance with Rule 15c2 -12, (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 of the Undertaking Section 16 Sale of Bonds The City Council has determined that it is in the best interest of the City to appoint the Mayor and the Director of Financial Services as the Designated Representative, both with individual authority to approve the final principal amount, dates, denominations, interest rates, payment dates, maturity dates, and redemption provisions of the Bonds, in the manner provided herein, provided that (a) The aggregate principal amount of the 2013A Bonds shall not exceed $9,150,000 and the aggregate principal amount of the 2013B Bonds shall not exceed $5,350,000 (b) One or more rates of interest may be fixed for the Bonds, and no rate of interest for any maturity of the Bonds may exceed 5 00% (c) The combined true interest cost to the City may not exceed 4 40% for the 2013A Bonds or 4 15% for the 2013B Bonds (d) The purchase price for each series of Bonds may not be less than 98% (e) The Bonds shall be issued subject to optional and mandatory redemption provisions, including designation of Term Bonds, if any, set forth in Section 9 (f) The Bonds shall be dated as of the date of their delivery, which date and time for the issuance and delivery of the Bonds is not later than December 31, 2013 (g) Interest shall be payable at fixed rates semiannually on each June 1 and December 1 and principal shall be payable semiannually (h) The final maturity of the 2013A Bonds shall not be later than December 1, 2036, and the final maturity of the 2013B Bonds shall not be later than December 1, 2028 (1) The Designated Representative is also authorized to take such additional action as may be necessary or convenient for carrying out the repayment of the Note, the prepayment of the 2009 Bond and issuing the Bonds pursuant to the terms of this ordinance 13 512808523 It is anticipated that the Underwriter will present the Bond Purchase Contract to the City offering to purchase the Bonds Pursuant to the terms of RCW 39 46 040(2), the Designated Representative is hereby authorized to serve as the designated representative of the City and to accept, on behalf of the City, the Bond Purchase Contract consistent with the terms of this ordinance The Bonds will be prepared at City expense and will be delivered to the Underwriter in accordance with the Bond Purchase Contract, with the approving legal opinion of Bond Counsel regarding the Bonds Section 17 Official Statement For the sole purpose of the Underwriter's compliance with paragraph (b)(1) of Rule 15c2 -12, the City authorizes the Designated Representative to "deem final" a preliminary official statement as of its date, except for the omission of information permitted to be omitted by Rule 15c2 -12 and ratifies the distribution by the Underwriter of that preliminary official statement to potential purchasers of the Bonds In addition, the City authorizes and approves the preparation, execution by the Designated Representative and delivery to the Underwriter of a final official statement for the Bonds, in the form of the preliminary official statement, with such modifications and amendments thereto as shall be deemed necessary or desirable by the City The City authorizes the Designated Representative to approve the distribution by the Underwriter of that final official statement to potential purchasers and purchasers of the Bonds Section 18 Supplemental Ordinances The City Council from time to time and at any time may pass an ordinance or ordinances supplemental to this ordinance which supplemental ordinance or ordinances thereafter shall become a part of this ordinance, for any one or more of the following purposes (a) To add covenants and agreements that do not adversely affect the interests of the holders and owners of the Bonds, or to surrender any right or power reserved to or conferred upon the City (b) To cure any ambiguities or to cure, correct or supplement any defective provision contained in this ordinance in a manner that does not materially adversely affect the interest of the holders and owners of the Bonds Section 19 General Authorization and Ratification The Designated Representative and other appropriate officers of the City and other appropriate officers of the City are severally authorized and directed to take any actions and to execute documents as in their judgment may be necessary or desirable to carry out the terms of, and complete the transactions contemplated by, this ordinance and the Bond Purchase Contract (including everything necessary for the prompt delivery of the Bonds to the Underwriter and for the proper application, use and investment of the proceeds of the sale thereof), and all actions heretofore taken in furtherance thereof and not inconsistent with the terms of this ordinance are ratified and confirmed in all respects Section 20 Severability The provisions of this ordinance are declared to be separate and severable If a court of competent jurisdiction, all appeals having been exhausted or all appeal periods having run, finds any provision of this ordinance to be invalid or unenforceable as 14 512808523 to any person or circumstance, such offending provision shall, if feasible, be deemed to be modified to be within the limits of enforceability or validity However, if the offending provision cannot be so modified, it shall be null and void with respect to the particular person or circumstance, and all other provisions of this ordinance in all other respects, and the offending provision with respect to all other persons and all other circumstances, shall remain valid and enforceable Section 21 Effective Date of Ordinance This ordinance shall take effect and be in force from and after its passage and five days following its publication as required by law PASSED by the City Council and APPROVED by the Mayor of the City of Bremerton, Washington, at an open public meeting thereof, this 17 day of April, 2013 CITY OF BREMERTON, WASHINGTON Mayor 41191 1 3 TEST City i APPROVED AS TO FORM City Attorney 15 512808523 CERTIFICATION I, the undersigned, City Clerk of the City of Bremerton, Washington (the "City "), hereby certify as follows 1 The attached copy of Ordinance No 5214 (the "Ordinance ") is a full, true and correct copy of an ordinance duly passed at a regular meeting of the City Council of the City held at the regular meeting place thereof on April 17, 2013, 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 the members voted in the proper manner for the passage of the Ordinance IN WITNESS WHEREOF, I have hereunto set my hand this ���ay of f , 2013 CITY OF BREMERTON WASHINGTON q�� City Clerk