Ordinance 14-007 Refunding Bonds ORDINANCE NO. 14-007
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SPOKANE VALLEY, OF SPOKANE COUNTY, WASHINGTON,
AUTHORIZING THE SALE, ISSUANCE AND DELIVERY OF NOT TO
EXCEED $7,900,000 AGGREGATE PRINCIPAL AMOUNT OF ITS
CITY OF SPOKANE VALLEY, WASHINGTON, LIMITED TAX
GENERAL OBLIGATION REFUNDING BONDS, 2014, TO
CURRENTLY REFUND ALL OR A PORTION OF THE CITY'S
LIMITED TAX GENERAL OBLIGATION BONDS, 2003; PROVIDING
FOR PAYMENT OF THE PRINCIPAL AND INTEREST ON THE
BONDS BY ANNUAL LEVIES OF TAXES; FIXING THE DATE, FORM,
CERTAIN TERMS AND COVENANTS OF SUCH 2014 BONDS;
DELEGATING TO THE AUTHORIZED REPRESENTATIVE OF THE
CITY THE AUTHORITY TO ESTABLISH CERTAIN TERMS OF THE
BONDS WITHIN THE PARAMETERS OF THIS ORDINANCE;
ADOPTING A REFUNDING PLAN; AUTHORIZING THE EXECUTION
OF AN ESCROW AGREEMENT; AUTHORIZING THE PURCHASE
OF CERTAIN GOVERNMENT OBLIGATIONS; PROVIDING FOR
THE CALL, PAYMENT AND REDEMPTION OF THE REFUNDED
BONDS; PROVIDING FOR THE REGISTRATION AND
AUTHENTICATION OF THE BONDS; DESIGNATING A BOND
REGISTRAR; CREATING AND ADOPTING CERTAIN FUNDS AND
ACCOUNTS AND PROVIDING FOR DEPOSITS THEREIN;
COVENANTING TO COMPLY WITH CERTAIN FEDERAL TAX AND
SECURITIES LAWS; AND PROVIDING FOR OTHER MATTERS
PROPERLY RELATING THERETO.
CITY OF SPOKANE VALLEY
Spokane County, Washington
LIMITED TAX GENERAL OBLIGATION REFUNDING BONDS,2014
PRINCIPAL AMOUNT OF NOT TO EXCEED $7,900,000
BE IT ORDAINED by the Mayor and the Members of the City Council of the City of
Spokane Valley, of Spokane County, Washington, as follows:
WHEREAS, the City of Spokane Valley (the "City"), of Spokane County, Washington, is
a duly incorporated and existing municipal corporation organized and operating under the
Constitution and laws of the State of Washington;
WHEREAS, the City is authorized and empowered by RCW 39.36, 39.46 and 39.53 to
authorize, issue, sell and deliver its limited tax general obligation refunding bonds to refinance
the costs of acquisition, construction and installation of improvements and betterments to City
facilities;
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WHEREAS, the City previously issued its Limited Tax General Obligation Bonds, 2003,
currently outstanding in the aggregate principal amount of $7,435,000 (the "2003 Bonds"),
pursuant to Ordinance No. 03-084 (the "2003 Ordinance"), enacted by the City Council of the
City (the "Council") on October 28, 2003, for the purpose of financing, in part, the acquisition,
construction and equipping of a regional community center at Mirabeau Point, related capital
facilities and street improvements (the "Project"), and to pay the costs of issuing the 2003 Bonds;
WHEREAS, the 2003 Bonds maturing on and after December 1, 2014, are subject to
redemption at the option of the City on or after December 1, 2013, in whole or in part at any time
(within one or more maturities to be selected by the City) at a price of 100 percent of the
principal amount thereof, plus accrued interest, if any, to the date fixed for redemption;
WHEREAS, to effect debt service savings, the City desires to defease, redeem and retire
all or a portion of the outstanding 2003 Bonds (such refunded 2003 Bonds, the "Refunded
Bonds") in accordance with the provisions of the 2003 Ordinance, if such defeasance,
redemption and retirement can be achieved at the desired savings level;
WHEREAS, after due consideration, the Council has determined that it will be
financially advantageous to the City to effect such a refunding plan and subject to achieving the
desired debt services savings, the Council has determined to issue, sell and deliver its City of
Spokane Valley, Washington, Limited Tax General Obligation Refunding Bonds, 2014, in an
aggregate principal amount not to exceed $7,900,000 (the "Bonds" or the "Refunding Bonds")
for the purposes of (i) funding the defeasance and redemption of the Refunded Bonds and to
acquire with such Bond proceeds and other available money of the City Government Obligations
that bear interest and mature at such times as necessary to pay interest, when due, on the
Refunded Bonds, and to redeem such Refunded Bonds on the date fixed for redemption and (ii)
paying costs of issuing the Bonds;
WHEREAS, the Council desires and hereby delegates to the Authorized Representative
(as defined herein) of the City, within certain parameters, certain duties and obligations with
respect to the issuance, sale and delivery of the Bonds authorized herein, including the selection
of Refunded Bonds to be defeased and redeemed with proceeds of the Bonds;
WHEREAS, the City wishes to designate the Washington State Fiscal Agent as the Bond
Registrar for the City for the Bonds;
WHEREAS, the Council has determined it to be in the best interest of the City to
negotiate the sale of the Bonds with D.A. Davidson & Co. (the "Underwriter") and to execute a
bond purchase agreement with the Underwriter in connection with the sale of the Bonds;
WHEREAS, the Council wishes to authorize the preparation, distribution and use by the
Underwriter of a preliminary official statement (the "Preliminary Official Statement") and an
official statement (the "Official Statement") in connection with the marketing and sale of the
Bonds; and
WHEREAS, the City wishes to ensure compliance with (i) the requirements of the
Internal Revenue Code of 1986, as amended (the "Code"), and the applicable regulations
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associated with the Bonds and any future issuance of tax-bonds issued by the City and (ii) the
City's continuing disclosure undertakings with respect to the Bonds and any other bonds that
may be issued by the City, and wishes to establish and maintain one or more policies with
respect to post-issuance compliance procedures (the"Post-Issuance Compliance Procedures").
NOW, THEREFORE, the City Council of the City of Spokane Valley, Washington
ordains as follows:
Section 1: Definitions
As used in this Ordinance, capitalized terms shall have the meanings provided in this
Section. Words of the masculine gender shall be deemed and construed to include correlative
words of the feminine and neuter genders, and vice versa. Words imparting the singular number
shall include the plural numbers and vice versa, unless the context shall otherwise indicate.
2003 Bonds means the City of Spokane Valley, Washington, Limited Tax General
Obligation Bonds, 2003, authorized and issued pursuant to the 2003 Ordinance.
2003 Ordinance means Ordinance No. 03-084 of the City, enacted by the Council on
October 28, 2003, and pursuant to which the 2003 Bonds were authorized.
Authorized Representative means the City Manager or such other City employee as may
be designated in writing by the City Manager, acting either singly or collectively.
Bond Fund means the City's "City of Spokane Valley Limited Tax General Obligation
Refunding Bond — Debt Service Fund" created by the 2003 Ordinance and continued by this
Ordinance.
Bond Purchase Contract means the written bond purchase contract between the
Underwriter and the City to purchase the Bonds from the City.
Bond Register means the registration records of the City, maintained by the Bond
Registrar, on which shall appear the names and addresses of the Registered Owners of the
Bonds.
Bond Registrar means the Washington State Fiscal Agent acting in the capacity as
registrar, authenticating agent, paying agent and transfer agent of the Bonds, or its successors in
functions, as now or hereafter designated.
Bonds means the herein-authorized series of limited tax general obligations bonds
designated as "City of Spokane Valley, Washington, Limited Tax General Obligation Refunding
Bonds, 2014."
City means the City of Spokane Valley, of Spokane County, Washington, a duly
incorporated and existing City organized and operating under the laws of the State acting by and
through its employees, officers and the Council.
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City Clerk or• Clerk shall mean the de facto or de jure City Clerk or other officer of the
City who is the custodian of the seal of the City and of the records of the proceedings of the City
and the Council, or his/her successor in function, if any.
City Manager shall mean the City Manager of the City, appointed by the Council, or
his/her successor in function, if any.
Code means the Internal Revenue Code of 1986, as amended, and any Treasury
Regulations promulgated thereunder•.
Commission means the Securities & Exchange Commission.
Costs of Issuance, when used with respect to the Bonds, means all costs necessary or
attributable to the issuance of the Bonds and which include, but are not limited to, legal fees and
expenses, fees and expenses of any financial advisors, cost of audits, costs related to the
defeasance and refunding of the Refunded Bonds, advertising and printing expenses, fees and
expenses of the fiduciaries, costs of Bond ratings, the initial fees, expenses and other amounts
payable to any depositary, or any other person whose services are required with respect to the
issuance of the Bonds and the defeasance and refunding of the Refunded Bonds, discounts to the
underwriters or other purchasers of the Bonds incurred in the issuance and sale of the Bonds.
Council means the City Council of the City, as the same shall be duly and regularly
constituted from time to time.
DTC means The Depository Trust Company, a limited-purpose trust company organized
under the laws of the state of New York, which will act as securities depository for the Bonds, or
any successor or substitute depository for the Bonds.
EMMA means the MSRB's Electronic Municipal Market Access system, which shall
receive all required filings under the Rule at http://emma.msrb.ortg, or such other municipal
securities information repository which may be designated by the Commission or the MSRB
from time to time.
Escrow Account means the City's "Limited Tax General Obligation Refunding Bonds,
2014 Escrow Account" created by Section 17 of this Ordinance and held by the Escrow Agent to
accomplish the refunding of the Refunded Bonds.
Escrow Agent means U.S. Bank National Association, appointed herein by the Council to
perform the duties of escrow agent described herein and under the Escrow Agreement with
respect to the Refunded Bonds.
Escrow Agreement means the Escrow Agreement to be executed and delivered by the
City and the Escrow Agent as described in Section 16 herein with respect to the Refunded
Bonds.
Finance Director shall mean the Finance Director of the City, or his or his/her successor
in functions, if any.
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Financial Advisor means Piper Jaffray & Co., Seattle, Washington, the City's financial
advisor with respect to the issuance of the Bonds.
Government Obligations means cash or any "government obligation," as defined in
chapter 39.53 RCW,pledged solely for the redemption of the Refunded Bonds, and referred to in
Sections 15 and 17 hereof.
Letter of Representations means the Blanket Issuer Letter of Representations, dated
November 18, 2003, from the City to DTC.
Mayor shall mean the de facto or de jure Mayor of the City, or any presiding officer or
titular head of the City or his/her successor in functions, if any.
MSRB means the Municipal Securities Rulemaking Board, or any successor to its
functions.
Net Proceeds when used with reference to the Bonds, shall mean the principal amount of
the Bonds, plus accrued interest, if any, and original issue premium, if any, and less original
issue discount, if any.
Official Statement shall mean the final official statement prepared and delivered in
connection with the marketing and sale of the Bonds.
Operating Reserve Account shall mean the "City of Spokane Valley CenterPlace
Operating Reserve Account" created by the 2003 Ordinance.
Ordinance means this Ordinance No. 14-007, enacted by the Council on July 15, 2014,
authorizing the sale, issuance and delivery of the Bonds.
Outstanding means, when used with reference to the Bonds, as of any particular date, all
Bonds that have been issued, executed, authenticated and delivered except: (1) Bonds canceled
because of payment prior to their stated dates of maturity; and (2) any Bond (or portion thereof)
deemed to have been paid pursuant to Section 10 of this Ordinance.
Participants means those broker-dealers, banks and other financial institutions from time
to time for which DTC holds the Bonds as securities depository.
Preliminary Official Statement shall mean the preliminary official statement of the City
prepared and delivered in connection with the marketing and sale of the Bonds.
Project means acquisition, construction and equipping of a regional community center at
Mirabeau Point, related capital facilities and street improvements, as originally financed, in part,
with proceeds of the 2003 Bonds, and to be refinanced with the Bonds.
Refunded Bonds means all or any portion of the 2003 Bonds designated as such by an
Authorized Representative to be refunded and retired using proceeds of the 2014 Bonds.
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Registered Owner shall mean the person or persons whose names and addresses shall
appear on the Bond Register maintained by the Bond Registrar, as the owner or owners of the
Bonds.
Rule means the Commission's Rule 15c2-12 under the Securities & Exchange Act of
1934, as the same may be amended from time to time.
State means the State of Washington.
Term Bonds, if any, shall be any Bond, the payment of the principal of which is to be
subject to mandatory redemption payments, as identified in the Bond Purchase Contract.
Underwriter means D.A. Davidson & Co., Seattle, Washington, as underwriter of the
Bonds.
Section 2: Interpretation
For all purposes of this Ordinance, except as otherwise expressly provided or unless the
context otherwise requires:
(A) Internal References. All references in this Ordinance to designated "Sections"
and other subdivisions are to the designated sections and other subdivisions of this Ordinance.
The words "herein," "hereof," "hereto," "hereby," "hereunder" and other words of similar import
refer to this Ordinance as a whole and not to any particular section or other subdivision,
(B) Persons. Words importing persons shall include firms, associations, partnerships
(including limited partnerships), trusts, corporations and other legal entities, including public
boards, as well as natural persons. Words of the masculine gender shall be deemed and
construed to include correlative words of the feminine and neuter genders, and vice-versa.
Words imparting the singular number shall include the plural number and vice-versa unless the
context shall otherwise indicate.
(C) Headings. Any headings preceding the texts of the several sections of this
Ordinance and the table of contents shall be solely for convenience of reference and shall not
constitute a part of this Ordinance, nor shall they affect its meaning, construction or effect.
(D) Writing Requirement. Every "notice," "certificate," "consent" or similar action
hereunder by the City shall, unless the form thereof is specifically provided, be in writing signed
by an authorized representative of the City.
(E) Time. In the computation of a period of time from a specified date to a later
specified date, the word "from" means "from and including" and each of the words "to" and
"until"means "to but excluding,"
(F) Redemption. Words importing the redemption or redeeming of a Bond or the
calling of a Bond for redemption do not include or connote the payment of such Bond at its
stated maturity or the purchase of such Bond.
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(G) Payment Terms. References to the payment of the Bonds shall be deemed to
include references to the payment of interest thereon.
Section 3: Description of the Bonds
Limited tax general obligation bonds of the City, designated as the "City of Spokane
Valley, Washington, Limited Tax General Obligation Refunding Bonds, 2014," are hereby
authorized to be sold, issued, executed and delivered by negotiated sale pursuant to the laws of
the State of Washington, including but not limited to RCW 39.36, 39.46 and 39.53.
The Bonds shall be dated the date of their initial delivery; shall be in an aggregate
principal amount not to exceed $7,900,000; and shall mature not later than December 1, 2033.
Interest on the Bonds shall be paid semiannually on each June 1 and December 1, commencing
on December 1, 2014, until their respective dates of maturity or redemption. Interest shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months. The Bonds shall
be subject to redemption prior to maturity as provided in the Bond Purchase Contract.
Each Bond shall be issued in fully registered form in authorized denominations of$5,000
and any integral multiple thereof within a single maturity and interest rate and shall be numbered
separately in such manner and with any additional designation as the Bond Registrar deems
necessary for purposes of identification.
The Bonds shall be in substantially the form set forth in Exhibit A attached hereto and by
this reference made part of this Ordinance, and shall be executed, authenticated, numbered and
registered as provided in Sections 3, 4 and 5 of this Ordinance.
Section 4: Execution and Authentication of the Bonds
(A) Execution of the Bonds. Without unreasonable delay, the City shall cause
definitive Bonds to be prepared, executed, and delivered, which Bonds shall be typewritten and
printed on safety paper. The Bonds shall be executed on behalf of the City by the manual
signature of the the Mayor or the City Manager, shall be attested by the manual signature of the
City Clerk and shall have the seal of the City impressed or imprinted thereon.
(B) Authentication of the Bonds. The executed Bonds shall then be delivered to the
Bond Registrar for authentication. The Bonds shall be numbered separately in the manner and
with any additional designation as the Bond Registrar deems necessary for purposes of
identification. Only those Bonds that bear a Certificate of Authentication substantially in the
form set forth in Exhibit A attached hereto and manually executed by an authorized
representative of the Bond Registrar shall be valid or obligatory for any purpose or entitled to the
benefits of this Ordinance. Such Certificate of Authentication shall be conclusive evidence that
the Bonds so authenticated have been duly executed, authenticated and delivered hereunder and
are entitled to the benefits of this Ordinance.
(C) Validity of Signatures. In case any of the officers who shall have signed or
attested any of the Bonds shall cease to be such officer or officers of the City before the Bonds
so signed or attested shall have been authenticated or delivered by the Bond Registrar, or issued
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by the City, such Bonds may nevertheless be authenticated, delivered and issued, and, upon such
authentication, delivery and issue, shall be as binding upon the City as though those who signed
and attested the same had continued to be such officers of the City. Any Bond may also be
signed and attested on behalf of the City by such persons as at the actual date of execution of
such Bond shall be the proper officers of the City although at the original date of such Bond any
such person shall not have been such officer of the City.
(D) Temporary Bonds. Until the definitive Bonds are prepared, if deemed necessary
by the Authorized Representative, the City may utilize a temporary Bond which shall be
typewritten, and which shall be delivered to the Underwriter in lieu of definitive Bonds, but
subject to the same provisions, limitations and conditions as the definitive Bonds. Such
temporary Bond shall be dated as of the date of the Bonds, shall be in the denomination of not to
exceed $7,900,000; shall be numbered T-1; shall be substantially of the tenor of such definitive
Bonds, but with such omissions, insertions and variations as may be appropriate to temporary
bonds; and shall be manually signed by the City Manager or the Mayor and attested to by the
City Clerk and shall have the seal of the City impressed or imprinted thereon. The Finance
Director shall be the Bond Registrar in the event and for so long as a temporary Bond is utilized.
Section 5: Bond Registrar, Authenticating Agent, Paying Agent and Transfer Agent
The Washington State Fiscal Agent is hereby appointed as the Bond Registrar,
authenticating agent, paying agent and transfer agent with respect to the Bonds, subject to the
terms and conditions of this Section 5.
(A) Delegated Duties. The Bond Registrar is hereby authorized and directed,
on behalf of the City, to authenticate and deliver Bonds initially issued or transferred or
exchanged in accordance with the provisions of the Bonds and this Ordinance and to carry out all
of the Bond Registrar's powers and duties under this Ordinance and the Washington State Fiscal
Agency Agreement between the Washington State Finance Committee and the Bond Registrar
(as the sante may be amended or readopted from time to time).
(B) Bond Register. The Bonds shall be issued only in registered form as to
both principal and interest. The Bond Registrar shall keep, or cause to be kept, at its designated
corporate trust office the Bond Register which shall at all times be open to inspection by the
City.
(C) Fees and Costs. Subject to the terms of the Washington State Fiscal
Agency Agreement referred to above, the City shall pay to the Bond Registrar from time to time
reasonable compensation for all services rendered under this Ordinance together with reasonable
expenses, charges, fees of counsel, accountants and consultants and other disbursements,
including those of its attorneys, agents and employees, incurred in good faith in and about the
performance of their powers and duties under this Ordinance.
(D) Representations. The Bond Registrar shall be responsible for its
representations contained in the Bond Registrar's Certificate of Authentication on the Bonds.
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(E) Ownership Rights. The Bond Registrar may become the Registered
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 depositary for and permit any of its officers or directors to
act as a member of, or in any other capacity with respect to, any committee formed to protect the
rights of Registered Owners of the Bonds.
Section 6: Book-Entry System Authorized
(A) The Bonds shall be initially issued in the form of a separate, single-certificated,
fully registered Bond for each maturity, in the aggregate principal amount of such maturity.
Upon initial issuance, the ownership of each Bond shall be registered in the Bond Register in the
name of Cede & Co., as nominee of DTC, the securities depository for the Bonds. Except as
provided in subsection(D) of this Section 6, all of the Bonds shall be registered in the Bond
Register in the name of Cede& Co., as nominee of DTC.
(B) With respect to Bonds registered in the Bond Register in the name of Cede& Co.,
as nominee of DTC, the City and the Bond Registrar shall have no responsibility or obligation to
any Participant or to any person on behalf of which a Participant holds an interest in the Bonds.
Without limiting the immediately preceding sentence, the City and the Bond Registrar shall have
no responsibility or obligation with respect to: (1)the accuracy of the records of DTC, Cede &
Co. or any Participant with respect to any ownership interest in the Bonds, (2)the delivery to any
Participant or any other person, other than a Registered Owner, of any notice with respect to the
Bonds, including any notice of redemption, or (3)the payment to any Participant or any other
person, other than a Registered Owner, of any amount with respect to principal of, premium, if
any, or interest on the Bonds. The City and the Bond Registrar may treat and consider the
Registered Owner of each Bond as the absolute owner of such Bond for the purpose of payment
of principal, premium, if any, and interest with respect to such Bond, for the purpose of giving
notices of redemption and other matters with respect to such Bond, for the purpose of registering
transfers with respect to such Bond, and for all other purposes whatsoever. The Bond Registrar
shall pay all principal of, premium, if any, and the interest on the Bonds as provided herein, and
all such payments shall be valid and effective to fully satisfy and discharge the City's obligations
with respect to payment of principal of, premium, if any, and interest on the Bonds to the extent
of the sums so paid. No person other than a Registered Owner shall receive a certificated Bond
evidencing the obligation of the City to make payments of principal, premium, if any, and
interest pursuant to this Ordinance. Upon delivery by DTC to the Bond Registrar of written
notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co.,
and subject to the provisions herein with respect to the transfer and payment of the Bonds, the
phrase "Cede & Co." in this Ordinance shall refer to such new nominee of DTC.
(C) The City heretofore has delivered a Letter of Representations to the Bond
Registrar and DTC. The delivery of the Letter of Representations shall not in any way limit the
provisions of subsection B of this Section 6 or in any other way impose upon the City any
obligation whatsoever with respect to persons having interests in the Bonds other than the
Registered Owner. The Bond Registrar shall take all action necessary for all representations of
the City in the Letter of Representations with respect to the Bond Registrar, to at all times be
complied with.
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(D) (1) DTC may determine to discontinue providing its services with respect to
the Bonds at any time by giving notice to the City and to the Bond Registrar, and discharging its
responsibilities with respect thereto under applicable law.
(2) The City, in its sole discretion and without the consent of any other
person, may terminate the services of DTC with respect to the Bonds if the City
determines that: (a) DTC is unable to discharge its responsibilities with respect to the
Bonds or (b) a continuation of the requirement that all of the Bonds be registered in the
Bond Register in the name of Cede & Co., or any other nominee of DTC, is not in the
best interest of the beneficial owners of the Bonds.
(3) Upon termination of the services of DTC with respect to the Bonds
pursuant to subsection (D)(2)(b) of this Section 6, or upon the discontinuance or
termination of the services of DTC with respect to the Bonds pursuant to
subsection (D)(1) or subsection(D)(2)(a) of this Section 6 after which no substitute
securities depository willing to undertake the functions of DTC hereunder can be found
that, in the opinion of the City, is willing and able to undertake such functions upon
reasonable and customary terms, the City shall deliver certificated Bonds at the expense
of the City, as described in this Ordinance, and the Bonds shall no longer be restricted to
being registered in the Bond Register in the name of Cede & Co. as nominee of DTC, but
may be registered in the names that the Registered Owners transferring or exchanging
Bonds shall designate, in accordance with the provisions of this Ordinance.
(E) Notwithstanding any other provision of this Ordinance to the contrary, so long as
any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with
respect to principal or premium, if any, and interest on such Bond and all notices with respect to
such Bond shall be made and given, respectively, in the manner provided in the Letter of
Representations.
Section 7: Place, Manner and Medium of Payment
(A) Payment Medium. Both principal of and interest on the Bonds are payable in
lawful money of the United States to the Registered Owners thereof.
(B) Payment of Interest. Payment of each installment of interest shall be made to the
Registered Owner whose name appears on the Bond Register at the close of business on the
fifteenth day of the calendar month preceding the interest payment date. Each installment of
interest shall be paid by check or draft of the Bond Registrar mailed to such Registered Owner
on the due date at the address appearing on the Bond Register, or at such other address as may be
furnished in writing by such Registered Owner to the Bond Registrar. Interest installments may
be paid by wire transfer to a Registered Owner of at least $1,000,000 in principal amount of the
Bonds, upon written request of such Registered Owner submitted to the Bond Registrar at least
15 days prior to the interest payment date; provided, the costs of such wire transfer shall be paid
by such Registered Owner.
(C) Payment of Principal. Principal of each Bond shall be payable to the Registered
Owner, upon presentation and surrender of the Bonds on or after the date of maturity or the date
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of prior redemption, whichever occurs first, at the designated corporate trust office of the Bond
Registrar. Upon the payment of the Bonds at maturity or the date of prior redemption of any
Bond being redeemed, each check or other transfer of money issued for such purpose shall bear
the CUSIP number, if any, and identify by issue and maturity the Bonds being paid with the
proceeds of such check or other transfer.
(D) Interest on Delinquent Amounts. If any Bond is not redeemed when properly
presented at its maturity date, the City shall pay interest on that Bond at the same rate provided
in the Bond from and after its maturity date until the principal of and interest on that Bond is
paid in full or until sufficient money for its payment in full is on deposit in the Bond Fund and
the Bond has been called for payment by giving notice to the Registered Owner of that unpaid
Bond.
(E) Ownership of Bonds. The City and the Bond Registrar may deem and treat the
Registered Owner of each Bond as the absolute owner of such Bond for the purpose of receiving
payments of principal and interest due on such Bond and for all other purposes, and neither the
City nor the Bond Registrar shall be affected by any notice to the contrary.
(F) Unclaimed Money. Pursuant to RCW 43.80.160 (as it now reads or is hereafter
amended or recodified), an Authorized Representative shall submit a written request to the Bond
Registrar that the Bond Registrar return to the City all money previously remitted to the Bond
Registrar for the payment of the Bonds that has not been distributed by the Bond Registrar as of
one year after the final maturity of all of the Bonds. The Authorized Representative shall deposit
such money into a separate account to be held solely for the benefit of the Registered Owners of
Bonds which have not been presented for payment, and which shall be used solely for paying the
principal of such Bonds and the interest which had accrued thereon to the date of maturity.
Interest earnings on the money in such account may be deposited into the Bond Fund to pay the
principal of and interest on any Bonds that are Outstanding.
Section 8: Transfer and Exchange of the Bonds
(A) Transfer of Bonds. Each Bond shall be transferable by the Registered Owner
thereof in person, or by its attorney duly authorized in writing, upon due completion of the
assignment form appearing thereon and upon surrender of such Bond at the designated corporate
trust office of the Bond Registrar for cancellation and issuance of a new Bond registered in the
name of the transferee, in exchange therefor.
(B) Exchange of Bonds. Each Bond shall be exchangeable by the Registered Owner
thereof in person, or by its attorney duly authorized in writing, for one or more new Bonds, upon
surrender of such Bond at the designated corporate trust office of the Bond Registrar for
cancellation.
(C) Authentication and Delivery of New Bonds. Whenever a Bond shall be
surrendered for transfer or exchange, the Bond Registrar shall authenticate and deliver to the
transferee or exchangee, in exchange therefor, a new fully registered Bond or Bonds of any
authorized denomination or denominations, of the same maturity and interest rate as, and for the
aggregate principal amount of, the Bond being surrendered. Notwithstanding the foregoing
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sentence, the Bond Registrar is not required to transfer or exchange any Bond during the 15 days
preceding any principal or interest payment date, or the date on which notice of redemption of a
Bond is to be given, or after such notice has been given.
(D) Payment of Fees and Costs. The Bond Registrar shall require the payment by the
Registered Owner requesting such transfer or exchange of any tax, fee or governmental charge
required to be paid with respect to such transfer or exchange.
Section 9: Mutilated,Destroyed,Lost or Stolen Bonds
(A) Issuance of Substitute Bonds. If any Bond shall become mutilated, destroyed, lost
or stolen, the affected Registered Owner shall be entitled to the issuance of a substitute Bond
only as follows:
(1) In the case of a lost, stolen or destroyed Bond, the Registered Owner shall:
(a) provide notice of the Ioss, theft or destruction to the City and the Bond Registrar
within a reasonable time after the Registered Owner receives notice of the loss, theft or
destruction; (b) request the issuance of a substitute Bond; (c) provide evidence,
satisfactory to the City and the Bond Registrar, of the ownership and the loss, theft or
destruction of the affected Bond; and (d) file in the offices of the City and the Bond
Registrar a written affidavit specifically alleging on oath that such Registered Owner is
the proper owner, payee or legal representative of such owner or payee of the Bond that
has been lost, stolen or destroyed, giving the date the Bond was issued, the number,
principal amount and series of such Bond, and stating that the Bond has been lost, stolen
or destroyed, and has not been paid and has not been received by such Registered Owner;
(2) In the case of a mutilated Bond, the Registered Owner shall surrender the
Bond to the Bond Registrar for cancellation; and
(3) In all cases, the Registered Owner shall provide indemnity against any and
all claims arising out of or otherwise related to the issuance of substitute Bonds pursuant
to this Section 9 satisfactory to the City and the Bond Registrar.
Upon compliance with the foregoing, a new Bond of like tenor and denomination,
bearing the sante number as the mutilated, destroyed, lost or stolen Bond, and with the word
"DUPLICATE" stamped or printed plainly on its face, shall be executed by the City,
authenticated by the Bond Registrar and delivered to the Registered Owner, all at the expense of
the Registered Owner to whom the substitute Bond is delivered, Notwithstanding the foregoing,
the Bond Registrar shall not be required to authenticate and deliver any substitute Bond for a
Bond which has been called for redemption or which has matured or is about to mature and, in
any such case, the principal or redemption price and interest then due or becoming due shall be
paid by the Bond Registrar in accordance with the terms of the mutilated, destroyed, lost or
stolen Bond without substitution therefor,
(B) Notation on the Bond Register. Upon the issuance and authentication of any
substitute Bond under the provisions of this Section 9, the Bond Registrar shall enter upon the
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Bond Register a notation that the original Bond was cancelled and a substitute Bond was issued
therefor.
(C) Rights of Registered Owners of Substitute Bonds. Every substituted Bond issued
pursuant to this Section 9 shall constitute an additional contractual obligation of the City and
shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all
other Bonds duly issued hereunder unless the Bond alleged to have been destroyed, lost or stolen
shall be at any time enforceable by a bona fide purchaser for value without notice. In the event
the Bond alleged to have been destroyed, lost or stolen shall be enforceable by anyone, the City
may recover the substitute Bond from the Registered Owner to whom it was issued or from
anyone taking under the Registered Owner except a bona fide purchaser for value without notice.
(D) Exclusive Rights. All Bonds shall be held and owned upon the express condition
that the foregoing provisions are exclusive with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Bonds, and shall preclude any and all other rights or
remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with
respect to the replacement or payment of negotiable instruments or of investment or other
securities without their surrender.
Section 10: Defeasance of the Bonds
In the event that money and/or government obligations (as defined from time to time in
RCW 39.53.010) maturing or having guaranteed redemption prices at the option of the owner at
such time or times and bearing interest to be earned thereon in such amounts as are sufficient,
together with any resulting cash balances, to redeem and retire part or all of the Bonds in
accordance with their terms, are hereafter irrevocably set aside in a special account and pledged
to effect such redemption and retirement, then no further payments need be made into the Bond
Fund or any account therein for the payment of the principal of and interest on the certain Bonds
so provided for, and such Bonds and interest accrued thereon shall no longer be deemed to be
Outstanding hereunder.
If the principal or redemption price of any Bonds becoming due, at maturity or otherwise,
together with all interest accruing thereon to the due date, has been paid or provision therefor
made in accordance with this Section 10, all interest on such Bonds shall cease to accrue on the
due date and all liability of the City with respect to such Bonds shall likewise cease, except as
hereinafter provided. Thereafter the Registered Owners of such Bonds shall be restricted
exclusively to the funds so deposited for any claim of whatsoever nature with respect to such
Bonds, and the Bond Registrar shall hold such funds in trust for such Registered Owners
uninvested and without interest.
Section 11: Cancellation of Surrendered Bonds
Bonds surrendered to the Bond Registrar for payment, redemption, transfer or exchange,
as well as Bonds surrendered by the City for cancellation, shall be canceled immediately by the
Bond Registrar and returned to the City. Such Bonds thereafter shall be destroyed pursuant to
RCW 43.80.130 (as it now reads or is hereafter amended or recodified), the Washington State
Fiscal Agency Agreement, or both.
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Section 12: Issuance, Sale and Delivery of the Bonds Authorized
The issuance, sale and delivery of the Bonds to the Underwriter is hereby authorized and
approved. The terms of said sale, including any premium or discount, and the terms of the
Bonds, including the optional and mandatory redemption provisions for the Bonds, that may be
approved by the Authorized Representative, on behalf of the City, will be set forth in the Bond
Purchase Contract, substantially in the form filed with the City, with such changes thereto as
shall be approved by the Authorized Representative executing such Bond Purchase Contract.
The Authorized Representative is hereby authorized, empowered and directed, on behalf of the
City, to negotiate, enter into, execute, deliver and approve the final terms of and provisions the
Bond Purchase Contract, subject to the limitations and requirements of this Ordinance, including
the following limitations:
(A) the principal amount of the Bonds maturing on each maturity date, provided the
aggregate principal amount of the Bonds does not exceed$7,900,000;
(B) the interest rate on the Bonds does not exceed a total interest cost of 4.25% per
annum;
(C) the date or dates upon which the Bonds shall mature, provided the Bonds shall
mature not later than December 1, 2033;
(D) as further described in Section 15, the aggregate net present value savings with
respect to all Refunded Bonds to be realized as a result of the refunding of the Refunded Bonds,
after the payment of the costs of issuance of the Bonds, is at least five percent (5%) of the
aggregate principal amount of the Refunded Bonds;
(E) the yield and price for each maturity of the Bonds, which price shall be not less
than 98 percent nor more than 120 percent of the principal amount of the Bonds;
(F) the Bond Purchase Contract is reviewed and approved by the Financial Advisor
for the City; and
(G) the Bond Purchase Contract is executed prior to December 31, 2014 and the
closing of the Bonds shall occur on or before January 31, 2015.
The Council hereby finds that the determinations made in this Ordinance are the
determnations set forth in RCW 39.46.040, and as such, the Council has fully and properly
authorized the issuance, sale and delivery of the Bonds.
The Authorized Representative is authorized to negotiate, enter into, execute, deliver and
approve final terms and provisions on behalf of the City any and all certificates, agreements or
other documents necessary or appropriate to implement the intent and purpose of this Ordinance,
and, along with other proper City officials are hereby further authorized, empowered and
directed to do everything necessary for the prompt execution and delivery of the Bonds to the
Underwriter or other purchaser(s) and for the proper application and use of the proceeds of the
sale thereof.
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Section 13: Pledge of Full Faith and Credit of the City
The Bonds are limited tax general obligations of the City and, as such, the full faith,
credit of the City are hereby pledged for their payment, within the appropriate constitutional and
statutory limitations pertaining to non-voted general obligations. The officers now or hereafter
charged by law with the duty of levying taxes for the payment of the Bonds and the interest
thereon shall, in the manner provided by law, make annual tax levies upon all of the taxable
property within the City sufficient, together with other legally available funds, to meet the annual
payments of principal and semiannual payments of interest maturing and accruing on the Bonds
as set forth herein, having always in mind the constitutional and statutory tax limitations
pertaining to non-voted general obligations.
Section 14: Redemption of Bonds Prior to Maturity
(A) Redemption. The Bonds may be subject to redemption prior to their stated dates of
maturity at the times and prices and in the manner specified in the Bond Purchase Contract,
subject to the approval of the Authorized Representative in consultation with the City's Financial
Advisor, Bond Counsel and the Underwriter,
(B) Partial Redemption. In accordance with the preceding paragraph, portions of the
principal amount of any Bond, in installments of$5,000 or any integral multiple of$5,000, may
also be redeemed. If less than all the principal amount of any Bond is redeemed, upon surrender
of such Bond at the designated corporate trust office of the Bond Registrar there shall be issued
to the Registered Owner, without charge therefor, for the then unredeemed balance of the
principal amount thereof, a new Bond or Bonds, at the option of the Registered Owner, with like
maturity and interest rate, in any denomination authorized by this Ordinance.
(C) Notice of Redemption. Unless waived by the Registered Owner of any Bond to be
redeemed, notice of any such redemption shall be sent by the Bond Registrar by first-class mail,
postage prepaid, not less than 20 nor more than 60 days prior to the date fixed for redemption to
the Registered Owner of each Bond to be redeemed at the address shown on the Bond Register,
or at such other address as may be furnished in writing by such Registered Owner to the Bond
Registrar. Such notice of redemption given hereunder shall include the following information:
(a) the date fixed for redemption; (b) the redemption price; (c) if less than all Bonds Outstanding
are to be redeemed, the identification (and, in the case of partial redemption, the respective
principal amounts) of the Bonds to be redeemed; (d) notification that on the date fixed for
redemption the redemption price shall become due and payable upon each such Bond or portion
thereof called for redemption, and that interest thereon shall cease to accrue from and after such
date; (e) the place where such Bonds are to be surrendered for payment of the redemption price,
which place of payment shall be the designated corporate trust office of the Bond Registrar; (f)
the CUSIP numbers, if any, of all Bonds being redeemed; (g) the date of issue of the Bonds as
originally issued; (h) the rate of interest borne by each Bond being redeemed; (i) the maturity
date of each Bond being redeemed; and (j) any other descriptive information needed to identify
accurately the Bonds being redeemed. The requirements of this subsection (C) shall be deemed
to be complied with when notice is mailed as herein provided, regardless of whether it is actually
received by the Registered Owner of any Bond to be redeemed,
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(D) Conditional Notice. Any notice given pursuant to this Section 14 may be
rescinded by written notice given to the Bond Registrar no later than two (2) business days prior
to the date specified for redemption. The Bond Registrar shall give notice of such rescission as
soon thereafter as practicable, and to the same Registered Owners, as notice of such redemption
was given pursuant to this Section 14.
(E) Notice of Redemption to DTC. For so long as DTC is the securities depository for
the Bonds, the Bond Registrar shall send redemption and defeasance notices to DTC in the
manner required by the Letter of Representations and DTC's operational procedures as then in
effect.
(F) Effect of Redemption. When so called for redemption, such Bonds shall cease to
accrue interest on the date fixed for redemption, provided funds for redemption are on deposit at
the place of payment at that time, and such Bonds shall not be deemed to be outstanding as of
such dated fixed for redemption.
(G) Additional Redemption Notice. In addition to the notice required by subsection
(C) above, further notice may be given by the Bond Registrar at least 30 days before the date
fixed for redemption by first-class mail, postage prepaid to: (a) all registered securities
depositories then in the business of holding substantial amounts of obligations such as the Bonds,
such depositories now being DTC; and to (b) one or more national information services that
disseminate notices of redemption of obligations such as the Bonds (such as EMMA), any failure
to give all or any portion of such further notice shall in any manner defeat the effectiveness of a
call for redemption if notice thereof is given as prescribed in subsection(C).
(I) Open Market Purchase and Cancellation. The City reserves the right to purchase
any of the Bonds on the open market at any time at any price. To the extent the City purposes
Term Bonds on the open market, the City may reduce, at its discretion, the amount of any
mandatory sinking fund deposit or deposits by an aggregate principal amount equal to the
principal amount of the Term Bonds so purchased. Any Bonds so purchased or redeemed shall
be cancelled.
Section 15: Plan of Refunding
(A) Designation of the Refunded Bonds. The Authorized Representative is hereby
authorized, empowered, on behalf of the City, to select for defeasance and redemption all or any
portion of the 2003 Bonds set forth in the table below, such 2003 Bonds to be designated the
Refunded Bonds, provided that the aggregate net present value savings with respect to all
Refunded Bonds to be realized as a result of the refunding of the Refunded Bonds, after the
payment of the costs of issuance of the Bonds, is at least five percent (5%) of the aggregate
principal amount of the Refunded Bonds.
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2003 Bonds
Payment Date Principal Interest CUSIP Nos.
December 1, 2014 $ 270,000 4.00% 849063AL6
December 1, 2015 285,000 4.00 849063AM4
December 1, 2016 300,000 4.00 849063AN2
December 1,2017 315,000 4.15 849063AP7
December 1, 2018 360,000 4.25 849063AQ5
December 1, 2019 395,000 5.00 849063AR3
December 1, 2020 440,000 5.00 849063AS1
December 1, 2021 485,000 5.00 849063AT9
December 1, 2022 525,000 5.00 849063AU6
December 1, 2023 580,000 5.00 849063AV4
December 1, 2025* 940,000 5.00 849063AW2
December 1, 2033* 2,540,000 5.00 849063AX0
* Tenn Bonds.
(B) Payments on the Refunded Bonds. The City shall, at such time as the Bonds are
delivered, irrevocably deposit Government Obligations in a sufficient amount to pay the interest
on the Refunded Bonds to and including the date the Refunded Bonds are to be refunded and
retired, and to refund and retire the Refunded Bonds on such date, at the price of par. Any
amounts necessary to pay and retire the Refunded Bonds that are not provided for in full by the
purchase and deposit of the Government Obligations shall be provided for by an irrevocable
deposit of cash from the proceeds of the Bonds or from other legally available money of the City.
(C) Notice of Redemption. Upon the issuance of the Refunding Bonds and the
funding the Escrow Account, as described in Section 17, of this Ordinance, the Escrow Agent is
hereby directed to give notice of the redemption of the Refunded Bonds in substantially the form
set forth in the Escrow Agreement and in the manner required by the 2003 Ordinance.
Section 16: The Escrow Agent; Escrow Agreement
The City hereby appoints U.S. Bank National Association to serve as Escrow Agent with
respect to the Refunded Bonds. The Authorized Representative is hereby authorized,
empowered and directed to execute and deliver an Escrow Agreement for the Refunded Bonds in
substantially the form on file with the City, with such changes thereto as shall be approved by the
Authorized Representative executing such Escrow Agreement.
Section 17: The Escrow Account
(A) Creation of the Escrow Account. The Escrow Agent is hereby authorized and
directed to establish a special account for the City designated the "Limited Tax General
Obligation Bonds, 2003 Escrow Account," or such other designation conforming to accounting
principles and banking practices.
(B) Deposits into the Escrow Account. The net proceeds of the Bonds allocable to the
defeasance and redemption of the Refunded Bonds other than: (1) accrued interest, if any,
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received from the sale of the Bonds, which shall be deposited into the Bond Fund; (2) amounts
paid to the Underwriter as Underwriter's discount, which shall be retained by the Underwriter
and (3) amounts, if any, received due to rounding the principal amount of the Bonds to the next
denomination of$5,000 and to pay for any contingencies, which shall be deposited into the Bond
Fund; shall be deposited into the Escrow Account and used to acquire Government Obligations
and to pay the costs of issuing the Bonds on the issue date of the Bonds. Such Government
Obligations, together with any cash balance remaining after the Government Obligations are
purchased and the costs of issuing the Bonds have been paid, shall be irrevocably deposited into
the Escrow Account. The Government Obligations and money to be deposited into the Escrow
Account shall be held by the Escrow Agent in trust. All Government Obligations, all proceeds
thereof, and all money credited to the Escrow Account shall be deemed so credited to and held in
the Escrow Account notwithstanding the fact that such Government Obligations, proceeds and
money therein are held by the Escrow Agent in trust for the owners of the Refunded Bonds.
(C) Irrevocable Pledge of Amounts in the Escrow Account. The City hereby
irrevocably pledges, at such time as the Bonds are delivered, the Government Obligations and
amounts on deposit in the Escrow Account to pay the interest on the Refunded Bonds up to and
including the date the Refunded Bonds are to be refunded and retired, and to refund and retire the
Refunded Bonds on such date at the price of par. Such Government Obligations are hereby
irrevocably pledged to be set aside to effect such payment, redemption and retirement.
(D) Use of Money in the Escrow Account. The Escrow Agent, on behalf of the City,
is hereby authorized and directed to use the proceeds of the Bonds, together with other legally
available money of the City, to purchase Government Obligations in the amounts, of the type,
bearing interest and maturing in such amounts as are necessary to make the payments described
in Section 15 of this Ordinance. The investment income from and maturing principal of the
Government Obligations and money to be deposited into the Escrow Account shall be
transmitted to the Washington State Fiscal Agent, as Bond Registrar for the City, for the sole
purpose of paying the principal of and interest on the Refunded Bonds as herein provided.
(E) Sulpha Money. Any money remaining on deposit in the Escrow Account after
the payment in full of the Refunded Bonds and the costs of issuing the Bonds, as herein set forth,
shall be transferred by the Escrow Agent to the City and deposited into the Bond Fund.
(F) Verification Report. Prior to the delivery of the Bonds, the City shall receive an
opinion of a nationally recognized firm of independent certified public accountants or from a
nationally recognized financial advisor, stating, in substance, that the money and Government
Obligations to be deposited with the Escrow Agent for the payment of the Refunded Bonds will
discharge and satisfy the City's obligations under the 2003 Ordinance to make payments on the
Refunded Bonds. Such opinion will not be required in the event the City deposits sufficient
funds at closing to provide for all debt service payments, without taking into account interest
earnings thereon.
Section 18: The Bond Fund
(A) Continuation of the Bond Fund. There was created under the 2003 Ordinance,
and shall continue to be maintained so long as the Bonds remain Outstanding, by the Finance
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Director, a fund separate and distinct from all other funds of the City known as the "LTGO Debt
Service Fund" (the "Bond Fund"), which shall be drawn upon for the sole purpose of paying
when due the principal of and interest on the Bonds and all other limited tax general obligations
bonds of the City. The proceeds of the taxes levied and collected pursuant to Section 13 hereof,
together with other legally available money, shall be deposited in the Bond Fund immediately
upon their collection, and thereafter held in the Bond Fund until withdrawn for the purposes of
this Section 18. Any accrued interest paid to the City as Bond proceeds shall be deposited into
the Bond Fund. The Finance Director is hereby authorized and directed to pay to the Bond
Registrar, in its capacity as the City's paying agent, all payments of principal and interest on the
Bonds in sufficient time for such payments to be made.
(B) Maintenance and Investment of Money in the Bond Fund. The Bond Fund shall
be maintained by the Finance Director until the principal of and interest on the Bonds, and all
other limited tax general obligations of the City, have been fully paid. Money in the Bond Fund
may be invested as permitted by law and the investment policy of the City, which investments
shall mature prior to the date on which such money shall be needed for required interest or
principal payments. All interest earned and income derived by virtue of such investments shall
remain in the Bond Fund and be used to meet the required deposits therein.
Section 19: Operating Reserve Account
There was created under the 2003 Ordinance and shall continue to be maintained, so long
as the Bonds remain Outstanding, by the Finance Director a fund known as the "City of Spokane
Valley CenterPlace Operating Reserve Account" (herein called the "Operating Reserve
Account"), in which the City covenanted in the 2003 Ordinance to maintain a balance of the
$300,000.
Moneys in the Operating Reserve Account shall be available for use in the payment of
expenses associated with the Project, including but not limited to operation and maintenance
expenses, debt service and capital repairs. If the City makes a draw on the funds in the
Operating Reserve Account, it shall at the same time file a plan for the replenishment of the
funds withdrawn. The City covenants to use all reasonable efforts to follow such a plan for
replenishment.
Section 20: Tax Exemption and Non-Arbitrage Covenants
(A) Compliance with the Code for the Bonds. The City covenants to comply with
each requirement of the Code necessary to maintain the exclusion of interest on the Bonds from
gross income for federal income tax purposes. In furtherance of the covenant contained in the
preceding sentence, the City covenants to comply with the provisions of the Tax Certificate
executed by the City on the date of initial issuance and delivery of the Bonds, as such Tax
Certificate may be amended from time to time.
(B) Necessary Payments. The City covenants to make any and all payments required
to be made to the United States Department of the Treasury in connection with the Bonds
pursuant to Section 148(f) of the Code.
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(C) Survival of Tax Covenants. Notwithstanding any other provision of this
Ordinance to the contrary, so long as necessary to maintain the exclusion from gross income of
interest on the Bonds for federal income tax purposes, the covenants contained in this Section 20
shall survive the payment of the Bonds and the interest thereon, including any payment or
defeasance thereof pursuant to Section 10 of this Ordinance.
(D) Remedies. Notwithstanding any other provision of this Ordinance to the contrary,
(1) upon the City's failure to observe or refusal to comply with the above covenants, the
Registered Owners, or any trustee acting on their behalf, shall be entitled to the rights and
remedies provided to the Registered Owners under this Ordinance with respect to enforcement of
the above covenants, and (2) neither the holder or registered owner of bonds of any series other
than the Bonds, nor any trustee acting on their behalf, shall be entitled to exercise any right or
remedy provided to the Registered Owners under this Ordinance based upon the City's failure to
observe, or refusal to comply with, the above covenants of this Section 20.
Section 21: Bonds Designated as "Qualified Tax-Exempt Obligations"
The Bonds are hereby designated as "qualified tax-exempt obligations" as defined in
Section 265(b) of the Code. The City covenants that it shall not designate more than
$10,000,000 of tax-exempt obligations during the calendar year 2014. The City does not
reasonably anticipate that it will issue in the aggregate more than $10,000,000 principal amount
of tax-exempt obligations during the calendar year 2014.
Section 22: Preliminary Official Statement; Official Statement
(A) Preliminary Official Statement. The Preliminary Official Statement relating to
the Bonds, in substantially the form presented to and considered at this meeting and which is
on file with the Clerk, shall be and hereby is authorized and approved and shall be delivered to
the Underwriter with such changes therein from such form as shall be deemed appropriate an
in the best interests of the City, upon consultation with counsel, by the Authorized
Representative, such approval to be evidenced conclusively by the delivery of the Preliminary
Official Statement to the Underwriter, as so added to or changed.
The Underwriter is hereby authorized to distribute the Preliminary Official Statement in
connection with the offer and sale of the Bonds. Prior to the distribution of the Preliminary
Official Statement, the Authorized Representative shall be and is hereby authorized,
empowered and directed to deem the Preliminary Official Statement final for purposes of Rule
15c2-12 of the Securities and Exchange Commission, such action to be conclusively evidenced
by delivery of each Preliminary Official Statement to the Underwriter.
(B) Official Statement. The Authorized Representative shall be and is hereby
authorized, empowered and directed to execute and deliver a final Official Statement with such
changes therein from the Preliminary Official Statement as such officer shall deem appropriate
and in the best interests of the City, as conclusively evidenced by his or her execution thereof.
The Underwriter is hereby authorized to distribute the Official Statements in connection with the
offer and sale of the Bonds.
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(C) Preparation of Preliminary Official Statement and Official Statement. The
Underwriter is hereby authorized to prepare the Preliminary Official Statement and the final
Official Statement for the Bonds.
Section 23: Undertaking to Provide Continuing Disclosure
The Authorized Representative of the City shall be and is hereby authorized,
empowered and directed to execute and deliver upon the issuance, sale and delivery of the
Bonds a Continuing Disclosure Certificate in substantially the form attached hereto as Exhibit
B, with such changes thereto as shall be approved by the Authorized Representative executing
such Continuing Disclosure Certificate,
Section 24: Amendments to Ordinance
(A) Amendments Not Requiring Registered Owner Consent. The Council may adopt
at any time ordinances supplemental hereto, which ordinances thereafter shall become a part of
this Ordinance, for any one or more of all of the following purposes: (1) to add to or delete from
the covenants and agreements of the City in this Ordinance, or to surrender any right or power
reserved to the City herein, provided such additions or deletions shall not adversely affect, in any
material respect, the interests of the Registered Owners of any Bonds; and (2) to cure, correct or
supplement any ambiguous or defective provision contained in this Ordinance, provided such
supplemental ordinance shall not adversely affect, in any material respect, the interests of the
Registered Owners of the Bonds. Any such supplemental ordinance may be adopted without the
consent of the Registered Owners of any Bonds at any time Outstanding, notwithstanding any of
the provisions of subsection (B) of this Section 24.
(B) Amendments Requiring Registered Owner Consent. With the consent of the
Registered Owners of not less than 65 percent in aggregate principal amount of the Bonds at the
time Outstanding, the Council may adopt an ordinance or ordinances supplemental hereto for the
purpose of adding any provisions to, or changing in any manner, or eliminating any of the
provisions of this Ordinance or of any supplemental ordinance; provided, however, that no such
supplemental ordinance shall: (1) extend the fixed maturity of any Bonds, or reduce the rate of
interest thereon, or extend the time of payments of interest from their due date, or reduce the
amount of the principal thereof, or alter the redemption provisions pertaining thereto, without the
consent of the Registered Owner of each Bond so affected; or(2) reduce the aforesaid percentage
of Registered Owners required to approve any such supplemental ordinance, without the consent
of the Registered Owners of all of the Bonds then Outstanding. It shall not be necessary for the
consent of Registered Owners under this subsection (B) to approve the particular form of any
proposed supplemental ordinance, but it shall be sufficient if such consent shall approve the
substance thereof.
(C) Effect of Supplemental Ordinances. Upon the adoption of any supplemental
ordinance pursuant to the provisions of this Section 24, this Ordinance shall be deemed to be
modified and amended in accordance therewith, and the respective rights, duties and obligations
of the City under this Ordinance and all Registered Owners of Bonds Outstanding hereunder
shall thereafter be determined, exercised and enforced thereunder, subject in all respects to such
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modification and amendments, and all terms and conditions of any such supplemental ordinance
shall be deemed to be part of the terms and conditions of this Ordinance for any and all purposes.
(D) Notations; Replacement Bonds. Bonds executed and delivered after the execution
of any supplemental ordinance adopted pursuant to the provisions of this Section 24 may have a
notation as to any matter provided for in such supplemental ordinance, and if such supplemental
ordinance shall so provide, new Bonds so modified as to conform in the opinion of the Council
to any modification of this Ordinance contained in any such supplemental ordinance, may be
prepared and delivered without cost to the Registered Owners of any affected Bonds then
Outstanding, upon surrender for cancellation of such Bonds in equal aggregate principal
amounts.
Section 25: Authority to Obtain Municipal Bond Insurance
If deemed desirable,the Authorized Representative is hereby authorized and empowered to
obtain municipal bond insurance policy to secure the payment of the principal of and interest on
the Bonds and to negotiate, enter into, execute and deliver, on behalf of the City, specific
instruments, documents, agreements or certificates that may be reasonably necessary to secure
such municipal bond insurance policy.
•
Section 26: Post-Issuance Compliance Procedures
The Authorized Representative is hereby authorized and empowered to cause the
preparation of and to adopt, execute and deliver on behalf of the City Post-Issuance Compliance
Procedures to ensure compliance with the requirements of the Code and any other applicable
regulations, as well as with the City's continuing disclosure undertakings, with respect to the
Bonds and to any other bonds issued by the City.
Section 27: Ratification
All actions not inconsistent with the provisions of this Ordinance heretofore taken by the
Council and its employees with respect to the redemption of the Refunded Bonds and the
issuance, sale and delivery of the Bonds, are hereby in all respects ratified, approved and
confirmed.
Section 28: General Authorization.
The Authorized Officers and other officers, agents and employees of the City are hereby
authorized and directed in the name of and on behalf of the City to take any and all steps, and to
execute any and all certificates, documents, agreements, notices and consents which any of them
may deem necessary or appropriate in order to accomplish the lawful issuance, sale and delivery
of the Bonds.
Section 29: Contract; Severability
The covenants contained in this Ordinance and in the Bonds shall constitute a contract
between the City and the holder of each and every Bond. All the covenants promises and
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agreements in this Ordinance contained by or on behalf of the City, or by or on behalf of the
Bond Registrar, shall bind and inure to the benefit of their respective successors and assigns,
whether so expressed or not.
If any one or more of the covenants or agreements provided in this Ordinance to be
performed on the part of the City shall be declared by any court of competent jurisdiction to be
contrary to law, then such covenants or agreements, shall be null and void and shall be deemed
separable from the remaining covenants and agreements in this Ordinance and shall in no way
affect the validity of the other provisions of this Ordinance or of any Bonds.
Section 30: Repealer
All ordinances or resolutions or parts thereof in conflict herewith are, to the extent of
such conflict, hereby repealed, and shall have no further force or effect.
Section 31: No Personal Recourse
No recourse shall be had for any claim based on this Ordinance or the Bonds against any
Council member or the City, nor any officer or employee, past, present or future, of the City or
of any successor body as such, either directly or through the City or any such successor body,
under any constitutional provision, statute or rule of law or by the enforcement of any assessment
or penalty or otherwise.
[Remainder of page intentionally blank]
23
Section 31: Effective Date
This Ordinance shall be in full force and effect five days after publication of this
Ordinance or summary thereof in the official newspaper of the City of Spokane Valley as
provided by law.
Passed by the City Council this 15th day of July, 2014.
Dean Grafos, Mayor
ATTES /
City Clerk, Christine Bainbridge C
Approved as to Form:
rrt
11 LL(''
Orrick, Herrington & Sutc e LLP
Special Counsel to the City
Date of Publication: July 25, 2014
Effective Date: July 30, 2014
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EXHIBIT A
FORM OF BOND
No. $
UNITED STATES OF AMERICA
STATE OF WASHINGTON
COUNTY OF SPOKANE
CITY OF SPOKANE VALLEY,WASHINGTON
LIMITED TAX GENERAL OBLIGATION REFUNDING BONDS,2014
The City has designated the Bonds as "Qualified Tax-Exempt Obligations"
Unless this Bond is presented by an authorized representative of The Depository Trust Company,
a New York corporation ("DTC"), to the Registrar for registration of transfer, exchange, or
payment, and any Bond issued is registered in the name of Cede & Co., or in such other name as
is requested by an authorized representative of DTC (and any payment is made to Cede & Co.,
or to such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL inasmuch as the Registered Owner hereof, Cede & Co., has an
interest herein.
INTEREST RATE: MATURITY DATE: CUSIP NO.:
The CITY OF SPOKANE VALLEY, of Spokane County, Washington (the "City"), a
duly incorporated and existing city under and by virtue of the Constitution and laws of the State
of Washington (the "State"), hereby acknowledges itself indebted and for valued received
promises to pay to:
CEDE & CO.
or registered assigns, on the Maturity Date set forth above, the principal sum of:
] AND NO/100 DOLLARS
and to pay interest thereon from the City of Spokane Valley Limited Tax General Obligation
Refunding Bond — Debt Service Fund (the "Bond Fund") from , 2014, or from the most
recent date to which interest has been paid or duly provided for, whichever is later, at the Interest
Rate per annum set forth above, payable commencing on December 1, 2014, and semiannually
thereafter on each June 1 and December 1,to the Maturity Date set forth above or to the date of prior
redemption, whichever occurs first. Interest shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months. Any capitalized term used in this Bond and not otherwise
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defined herein shall have the same meaning as in the Ordinance No. 14 adopted by the City
Council of the City(the"Council") on , 2014 (the "Ordinance").
The principal of and interest on this Bond are payable in lawful money of the United
States of America to the Registered Owner hereof, whose name and address shall appear on the
registration books of the City (the "Bond Register") maintained by the Washington State Fiscal
Agent in New York, New York (the "Bond Registrar"). Interest shall be paid to the Registered
Owner whose name appears on the Bond Register at the close of business on the fifteenth day of
the calendar month preceding the interest payment date, and shall be paid by check or draft of the
Bond Registrar mailed to such Registered Owner on the due date at the address appearing on the
Bond Register, or at such other address as may be furnished in writing by such Registered Owner
to the Bond Registrar. Interest installments may be paid by wire transfer to a Registered Owner
of at least $1,000,000 in principal amount of the Bonds, upon written request of such Registered
Owner submitted to the Bond Registrar at least 15 days prior to the interest payment date;
provided the costs of such wire transfer shall be paid by such Registered. Owner. Principal of
this Bond shall be paid to the Registered Owner upon presentation and surrender of this Bond on
or after the Maturity Date set forth above or date of prior redemption of this Bond, whichever
occurs first, at the designated corporate trust office of the Registrar.
The City and the Bond Registrar may deem and treat the Registered Owner of this Bond
as the absolute owner of this Bond for the purpose of receiving payments of principal and
interest due on this Bond and for all other purposes, and neither the City nor the Bond Registrar
shall be affected by any notice to the contrary.
Reference is hereby made to the Additional Provisions of this Bond set forth on page 3
hereof, and such Additional Provisions shall for all purposes have the same effect as if set forth
in this space.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Ordinance until the Certificate of Authentication hereon is manually
signed by the Bond Registrar.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that this Bond and the series
of which it is one, is issued pursuant to and in strict compliance with the Constitution and the
laws of the State now in force and the ordinances and resolutions of the City, specifically the
Ordinance; 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 been performed; and that the issuance of
this Bond and the Bonds of this series does not exceed any constitutional, statutory or other
limitation upon the amount of bonded indebtedness the City may incur.
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IN WITNESS WHEREOF, the City of Spokane Valley, of Spokane County, Washington,
has caused this Bond to be executed by the manual signature of its City Manager, attested by the
manual signature of its City Clerk, and impressed with its seal on , 2014.
CITY OF SPOKANE VALLEY,
Spokane County, Washington
(Manual Signature)
City Manager
ATTEST:
(Manual Signature)
City Clerk
(S E A L)
CERTIFICATE OF AUTHENTICATION
Date of Authentication:
This Bond is one of the City of Spokane Valley, Washington Limited Tax General
Obligation Refunding Bonds, 2014, dated , 2014, and described in the within-
mentioned Ordinance.
WASHINGTON STATE FISCAL AGENT, as
Bond Registrar
By
Authorized Officer
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ADDITIONAL PROVISIONS
This Bond is one of a duly authorized series of Bonds of like date, tenor and effect,
except for variations required to state denominations, redemption provisions, numbers, interest
rates, and dates of maturity, aggregating the principal sum of $ . The Bonds are
issued in fully registered form in denominations of$5,000 each or any integral multiple thereof
within a single maturity, and mature on December 1 of the years 20_ through 20_, inclusive
and in the year 20_. Capitalized terms used in this Bond shall have the meanings given to them
in the Ordinance.
The Bonds are issued by the City pursuant to and in full compliance with the Constitution
and the laws of the State now in force, particularly RCW 39.36, 39.46 and 39.53, and
proceedings duly adopted and authorized by the Council, more particularly the Ordinance, for
the purpose of (i) funding the defeasance and redemption of the City's Limited Tax General
Obligation Bonds, 2003 (the"Refunded Bonds") and (ii)paying costs of issuing the Bonds, all as
more particularly described in the Ordinance.
The Bonds are limited tax general obligations of the City, and, as such, the full faith,
credit and resources of the City have been irrevocably pledged for the punctual and full payment
of the principal and interest on the Bonds within the appropriate constitutional and statutory tax
limitations pertaining to non-voted general obligations. The officers now or hereafter charged by
law with the duty of levying taxes for the payment of such Bonds shall make annual levies upon
all of the taxable property within the City, which, together with other legally available money,
shall be sufficient in amount to meet the annual payments of principal and the semiannual
payments of interest maturing and accruing on the Bonds.
[REDEMPTION PROVISIONS TO COME]
Notice of any such redemption, unless waived by the Registered Owner of any Bond to
be redeemed, shall be sent by the Bond Registrar by first-class mail, postage prepaid, not less
than 20 nor more than 60 days prior to the date fixed for redemption, to the Registered Owner of
each Bond to be redeemed, at the address shown on the Bond Register, or at such other address
as may be furnished in writing by such Registered Owner to the Bond Registrar. Such
requirements shall be deemed to be complied with when notice is mailed as herein provided,
regardless of whether or not it is actually received by the Registered Owner of any Bond to be
redeemed. When so called for redemption, the Bonds shall cease to accrue interest on the
specified dated fixed for redemption,provided money for redemption is on deposit at the place of
payment at that time, and shall not be deemed to be Outstanding as of such date fixed for
redemption.
The City retains the right to rescind the redemption notice and the related redemption of
Bonds by giving a notice of rescission to the affected Registered Owners at any time up to [ ]
days prior to the scheduled dated fixed for redemption. Any notice of redemption that is so
rescinded shall be of no effect, and the Bonds for which the notice of redemption has been
rescinded shall remain outstanding.
The City has reserved the right to purchase the Bonds on the open market at any time and
at any price. To the extent the City purchases the Term Bonds on the open market, the City may,
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at its discretion, reduce the amount of any mandatory sinking fund deposit or deposits by an
aggregate principal amount equal to the principal amount of the Term Bonds so purchased. Any
Bonds so purchased or redeemed shall be cancelled.
This Bond is transferable or exchangeable by the Registered Owner hereof in person, or
by its attorney duly authorized in writing, upon due completion of the Assignment appearing
hereon and upon presentation and surrender of this Bond at the designated corporate trust office
of the Bond Registrar. Upon such transfer or exchange, a new Bond or Bonds of any authorized
denomination, of the same maturity and interest rate, and for the same aggregate principal
atnount of the Bond being surrendered will be issued to the transferee or exchangee, in exchange
therefor, The Registrar is not required to transfer or exchange any Bond during the 15 days
preceding any principal or interest payment date, or the date on which notice of redemption of a
Bond is to be given or after such notice has been given.
Reference is hereby made to the Ordinance for the covenants and declarations of the City
and other terms and conditions under which this Bond and the Bonds of this series have been
issued. The covenants contained herein and in the Ordinance, as they may apply to this Bond,
may be discharged by making provision, at any time, for the payment of the principal of and
interest on this Bond in the manner provided in the Ordinance.
LEGAL OPINION
I, the undersigned City Clerk of the City of Spokane Valley, of Spokane County,
Washington, DO HEREBY CERTIFY that the legal opinion of Orrick, Herrington & Stucliffe
LLP, of Portland, Oregon, which opinion was dated the date of delivery of the Bonds described
therein, was delivered to me on said date, and is now part of the permanent records of the City.
CITY OF SPOKANE VALLEY,
Spokane County, Washington
(Manual Signature)
City Clerk
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The following abbreviations, when used in the inscription on the face of this Bond, shall
be construed as though they were written out in full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT- under Uniform Transfer to
Minors Act
TEN ENT- as tenants by the entireties
(Custodian) (Minor)
JT TEN- as joint tenants with right
of survivorship and not as
tenants in common (State)
Additional abbreviations may also be used although not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
Name of Transferee:
Address:
Tax Identification No.:
the within Bond and hereby irrevocably constitutes and appoints
to transfer such Bond on
the books kept for registration thereof with full power of substitution in the premises.
Registered Owner
NOTE: The signature on this Assignment
must correspond with the name of the
Registered Owner as it appears upon the
face of the within Bond in every particular,
without alteration or enlargement or any
change whatsoever.
Dated:
SIGNATURE GUARANTEED:
Bank, Trust Company or Member
Firm of the New York Stock Exchange
Authorized Officer
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EXHIBIT B
FORM OF CONTINUING DISCLOSURE CERTIFICATE
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SUMMARY OF ORDINANCE NO. 14-007 FOR PUBLICATION
CITY OF SPOKANE VALLEY
SPOKANE COUNTY,WASHINGTON
$7,900,000 LIMITED TAX GENERAL OBLIGATION REFUNDING BONDS, 2014
The title of Ordinance No. 14-007, enacted by the City Council of the City of Spokane
Valley, Washington, on July 15, 2014, is as follows:
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SPOKANE VALLEY, OF SPOKANE COUNTY, WASHINGTON,
AUTHORIZING THE SALE, ISSUANCE AND DELIVERY OF NOT TO
EXCEED $7,900,000 AGGREGATE PRINCIPAL AMOUNT OF ITS
CITY OF SPOKANE VALLEY, WASHINGTON, LIMITED TAX
GENERAL OBLIGATION REFUNDING BONDS, 2014, TO
CURRENTLY REFUND ALL OR A PORTION OF THE CITY'S
LIMITED TAX GENERAL OBLIGATION BONDS, 2003; PROVIDING
FOR PAYMENT OF THE PRINCIPAL AND INTEREST ON THE
BONDS BY ANNUAL LEVIES OF TAXES; FIXING THE DATE, FORM,
CERTAIN TERMS AND COVENANTS OF SUCH 2014 BONDS;
DELEGATING TO THE AUTHORIZED REPRESENTATIVE OF THE
CITY THE AUTHORITY TO ESTABLISH CERTAIN TERMS OF THE
BONDS WITHIN THE PARAMETERS OF THIS ORDINANCE;
ADOPTING A REFUNDING PLAN; AUTHORIZING THE EXECUTION
OF AN ESCROW AGREEMENT; AUTHORIZING THE PURCHASE
OF CERTAIN GOVERNMENT OBLIGATIONS; PROVIDING FOR
THE CALL, PAYMENT AND REDEMPTION OF THE REFUNDED
BONDS; PROVIDING FOR THE REGISTRATION AND
AUTHENTICATION OF THE BONDS; DESIGNATING A BOND
REGISTRAR; CREATING AND ADOPTING CERTAIN FUNDS AND
ACCOUNTS AND PROVIDING FOR DEPOSITS THEREIN;
COVENANTING TO COMPLY WITH CERTAIN FEDERAL TAX AND
SECURITIES LAWS; AND PROVIDING FOR OTHER MATTERS
PROPERLY RELATING THERETO.
A copy of the entire Ordinance is on file with the City Clerk and available for
review during normal office hours.
CITY OF SPOKANE VALLEY,
Spokane County Washington
Christine Bainbridge,
Spokane Valley City Clerk
Published: July 25, 2014
( SEAL)
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