1793_00001ORDINANCE NO.1793
CITY OF MOSES LAKE,WASHINGTON$1,695,000LIMITEDTAXGENERALOBLIGATION REFUNDING BONDS,1998
TABLE OF CONTENTS1
Section PageNo.Title No.
Recitals ...............1
1 Definitions ...............1
A.Acquired Obligations .........1B.Beneficial Owners ...........1C.Bond Redemption Fund ..........1D.Bond Registrar .............1E.Bonds ...............1F.City ...............2G.Code ...............2H.Council ...............2I.DTC ...............2J.Insurer or MBIA ............2KRefundedBondFund..........2L.Refunded Bonds ............2M.Refunding Plan ............3N.Refunding Trustee ...........3
2 Purpose and Authorization of Bonds .....3
3 Description of Bonds ............3
0 4 Place and Manner of Payment;Transfer of Bonds ...........3
5 Right of Prior Redemption and Purchase ...4
A.Certain Bonds Not Subject to PriorRedemption............4B.Optional Redemption of certain BondsReserved.............4C.Purchase on the Open Market ......4
6 Notice of Redemption ............4
A.While Bonds Held in Book-Entry Form byDTCorItsNominee........4B.After Book-Entry System Discontinued .4C.Redemption Notice ...........4D.Interest Ceases to Accrue on RedemptionDate...............5E.Failure of Delivery of Notice ofRedemptionShallNotAffectValidityofCall.........57Security...............5
8 Bond Redemption Fund ............5
9 Tax code Covenant .............S
10 Defeasance ...............5
1 This Table of Contents is provided for reference only and does not constitute a part of the Ordinanceforwhichitisprovided.
1998 LTGOBond Ordinance -Page i
Section
PageNo.Title No.
11 Form of Bonds ...............6
A.Held in Book-Entry Form by Nominee of DTC 6B.Transferred to Individual Bond Owners .8C.Statement of Insurance ........9D.Reverse of Either Form of Bond .....10E.Form of Assignment ..........11
12 Execution and Authentication of the Bonds ..12
13 Bond Registrar ................12
14 Lost or Destroyed Bonds ...........12
15 Findings and Designation of BankEligibility.............,13
16 Refunding Plan ...............13
A.Appointment of Refunding Trustee ....13B.Refunding Escrow Account Established ,13C.Application of Bond Proceeds .....13D.Acquisition of Acquired Obligations ..13E.Right of Substitution Reserved ....13F.Administration of Refunding Plan ...14G.Authorisation for Refunding TrustAgreement............14H.Call for Redemption of the Refunded Bonds 14
17 Sale of Bonds ...............14
18 Authorization to City Officials and Agents .14
19 Undertaking to Provide ongoing Disclosure ..15
A.Definitions ..............15
1.Commission ............152.MSRB ...............153.NRMSIR ..............154.Rule ...............155.SID ...............15
B.Contract|Undertaking .........15C.Financial Statements/Operating Data ..15D.Material Events ............15E.Termination/Modification
.......16F.Bond Owner's Remedies UnderThisSection...........16
20 Bond Insurance ...............16
A.Events of Default;Remedies ......16B.Notices to Insurer ..........1721PriorActsRatified............1722Severability...............1723EffectiveDate...............17
Signatures ...............17
Exhibit A -Refunding Trust Agreement
Exhibit B -Permitted Investments for AnyEscrowFundEstablishedPursuanttoSection10ofOrdinanceNo.1793
1998 LTGOBonci Ordinance -Page ii
ORDINANCE NO.1793
AN ORDINANCE of the City Council of Moses Lake,
Washington,providing for the issuance of limited taxgeneralobligationrefundingbondsoftheCityintheaggregateprincipalamountof$1,695,000 to refund theoutstandinglimitedtaxgeneralobligationbonds,1990andlimitedtaxgeneralobligationbonds,1992;fixing
the date,form,terms,maturities and covenants of saidObonds;providing for limited tax levies to secure therepaymentofthebonds;establishing a refunding plan andauthorizingarefundingtrustagreement,undertaking toprovidecertainongoingdisclosure;and accepting anoffertopurchasethebondshereinauthorized.
WHEREAS,the City of Moses Laker Washington (the "City")hascurrentlyoutstanding$530,000 principal amount of its Limited TaxGeneralObligationBonds,1990 issued under date of July 1,1990 and$1,015,000 principal amount of its Limited Tax General Obligation
Bonds,1992 issued under date of August 1,1992;and
WHEREAS,cities are authorized to issue general obligationbondswithoutavoteoftheirelectorssecuredbytaxeslevied bytheCitywithinandasapartofthetaxlevypermittedtocitieswithoutavoteoftheelectors,subject to certain limitations astoindebtednessimposedbyRCW39.36.020;and
WHEREAS,it is hereby found and determined that the City mayrealizeasubstantialdebtservicesavingsbyissuing$1,695,000 oflimitedtaxgeneralobligationrefundingbondstocarryoutaplanofrefundingtheaforesaidoutstandingbonds;and
WHEREAS,the City has received a commitment for insurance ofOthelimitedtaxgeneralobligationrefundingbondsauthorizedbythisordinancefromMBIAInsuranceCorporation,a firm experiencedininsuringmunicipalbondsofthetypeauthorizedbythisordinance,if,when and as issued by the City;and
WHEREAS,the City has received an offer to purchase suchrefundingbondsfromSeattle-Northwest Securities Corporation;and
WHEREAS,it is in the best interests of the city to acceptsuchofferandtoissuesuchrefundingbonds;NOW,THEREFORE,
THE CITY COUNCIL OF THE CITY OF MOSES LAKE,RASHINGTON,DOORDAINasfollows:
Section 1.Definitions.As used in this ordinance thefollowingtermsshallhavethefollowingmeanings:
A."Acquired Obligations"means the United StatesTreasuryobligationstobeacquiredtocarryouttheplantorefundtheRefundedBonds.
B."Beneficial Owner"means a person or persons forwhomDTCoraDTCparticipantacquiresaninterestintheBonds.
C."Bond Redemption Fund"means the "Limited TaxGeneralObligationBondRedemptionFund,1998"created by Section 8ofthisordinance.
D."Bond Registrar"means the fiscal agencies of theStateofWashington,in seattle,Washington,and New York,NewYork,as registrar and paying agent for the Bonds.
E."Bondsn means the $1,695,000 par value limited taxgeneralobligationrefundingbondsoftheCityissuedpursuanttoandforthepurposesprovidedinthisordinance.
1998 LfGO Band Ordinance -Page 1
F."City"means the City of Moses Lake,a municipal
corporation duly organized and existing as a code city under and by
Virtue of the laws of the State of Washington.
G."Code"means Sections 103,141,147,148,149 and
150 of the Internal Revenue Code of 1986,as amended,and
applicable temporary and permanent regulations promulgated
thereunder.
H."Counciln means the general legislative authority of
O the City as the same shall be duly and regularly constituted from
time to time.
I."DTC"means The Depository Trust Company,New York,
New York,in its capacity as securities depository for the Bonds,
providing a book-entry system for and,through its nominee Cede &
Co.,the registered owner of the Bonds.
J.nInsurer"or "MBIA"means MBIA Insurance
Corporation,Armonk,New York,as insurer of the Bonds.
K."Refunded Bond Fundu means the special escrow fund
established by the Refunding Trustee pursuant to section 16 of this
ordinance and to the refunding trust agreement authorized thereby.
L."Refunded BondsN gggggg
(i)The outstanding Limited Tax General Obligation
Bonds,1990 of the city dated July 1,1990,issued pursuant toOrdinanceNo.1435,and maturing or subject to mandatory redemption
on June 1 of the following years and in the following principal
amounts and bearing interest at the following rates:
Maturity or Mandatory Principal Interest
Redemption Year Amount Rate
1998 $25,000 7.00%
1999 25,000 7.10%
2000 30,000 7.20%
2001 30,000 7.25%
2002 35,000 7.30%
2003 35,000 7.30%
2004 40,000 7.35%
2005 40,000 7.35%
2006*45,000 7.40%
2007*50,000 7.40%
2008*55,000 7.40%
2009*60,000 7.40%
2010 (at maturity)60,000 7.40%
$530,000
*Mandatory Redemption Schedule for 2010 Term Bonds.
(ii)The outstanding Limited Tax General Obligation
Bonds,1992 of the City dated August 1,1992,issued pursuant toOrdinanceNo.1526,and maturing on August 1 of the following yearsandinthefollowingprincipalamountsandbearinginterestatthefollowingrates:
[Remainder of this page intentionally left blank.]
O
19WLTGOBod0rdirmme -Page 2
Maturity Principal Interest
Year Amount Rate
1998 $45,000 5.40%
1999 45,000 5.55%
2000 50,000 5.65%
2001 50,000 5.80%
2002 55,000 5.90%
2003 55,000 6.00%
2004 60,000 6.10%
O 2005 65,000 6.20%
2006 70,000 6.25%
2007 75,000 6.30%
2008 75,000 6.35%
2009 80,000 6.40%
2010 90,000 6.45%
2011 100,000 6.50%
2012 100,000 6.50%
$1,015,000
M."Refunding Plan"the plan for refunding the Refunded
Bonds set forth in Section 16 of this ordinance.
N."Refunding Trustee"means Chase Manhattan Trust Co.,
NA,a corporate fiduciary qualified to do business in the State ofWashington,appointed by Section 16 of this ordinance as refunding
trustee under the refunding trust agreement authorized thereby.
Section 2.Purpose and Authorization of Bonds.For thepurposeofrefundingalloftheoutstandingLimitedTaxGeneralObligationBonds,1990,dated July 1,1990,and all of theoutstandingLimitedTaxGeneralobligationBonds,1992,datedAugust1,1992,the City shall now issue and sell its limited taxgeneralobligationrefundingbonds(the "Bonds")in the aggregateprincipalamountof$1,695,000.
Section 3.Description of Bonds.The Bonds shall bedesignated"city of Moses Lake,Washington,Limited Tax GeneralObligationRefundingBonds,1998,n shall be dated January 1,1998,shall be in the denomination of $5,000 each or any integralmultipleof$5,000,provided no Bond shall represent more than onematurity,shall be numbered separately in the manner and with anyadditionaldesignationastheBondRegistrardeemsnecessaryfor
purposes of identification,shall be fully registered as to bothprincipalandinterest,shall bear interest from such date untilthebondbearingsuchinteresthasbeenpaidorfundsareavailableintheBondRedemptionFundsufficienttomakesuchpaymentinfull.Interest shall be payable semiannually on the first days ofeachFebruaryandAugust,commencing August 1,1998,at the ratessetforthbelow,and shall mature on August 1 of each of thefollowingyearsandinthefollowingamounts:
Maturity Principal Interest
Year Amount Rate
1998 $120,000 4.00%1999 85,000 4.00%2000 100,000 4.00%2001 100,000 4.10%2002 105,000 4.25%
2003 100,000 4.30%
2004 110,000 4.30%2005 115,000 4.40%
2006 120,000 4.40%2007 130,000 4.50%2008 130,000 4.50%2009 135,000 4.60%2010 145,000 4.70%2011 100,000 4.75%2012 100,000 4.80%
Section 4.Place and Manner of Payment;Transfer of Bonds.Both principal of and interest on the Bonds shall be payable in
1998LTGOBudOrdimne -Page 3
lawful money of the United States of America.Interest on theBondsshallbepaidbycheckordraftmailedtotheregistered
owners or assigns at the addresses appearing on the bond register
on the 15th day of the month preceding the interest payment date.Principal of and premium,if any,on the Bonds shall be payable
upon presentation and surrender thereof by the registered owners totheBondRegistrar;provided that,while the Bonds are in the form
set forth in Subsection 11.A of this ordinance and are registered
to DTC or its nominee,payments of principal and interest shall bemadeinaccordancewithaBlanketIssuerLetterofRepresentation
from the City to DTC.
Upon surrender thereof to the Bond Registrar,the Bonds areinterchangeableforbondsinanyauthorizeddenominationofanequalaggregateprincipalamountandofthesameinterestrateandmaturity.Bonds may be transferred only if endorsed in the mannerprovidedthereonandsurrenderedtotheBondRegistrar.Such
exchange or transfer shall be without cost to the owner ortransferee.
Section 5.Right of Prior Redemption and Purchase.
A.Certain Bonds Not Subject to Prior Redemption.TheBondsmaturingonorbeforeAugust1,2008,are not subject to anyredemptionpriortomaturity.
B.Optional Redemption of certain Bonds Reserved.TheCityherebyreservestheright,at its option,to redeem theoutstandingBondsmaturingonorafterAugust1,2009,in whole orinpart(maturities to be selected by the City and by lot within amaturityinsuchmannerastheBondRegistrarshalldetermine),onAugust1,2008,and any date thereafter,at a price equal to theparamountthereof,plus accrued interest to the date ofredemption.
O C.Purchase on the Open Market.The City furtherreservestheright,at any time and at any price,to purchase anyoftheBondsintheopenmarketforretirementonly.
Section 6.Notice of Redemption.
A.While Bonds Held in Book-Entry Form by DTC or ItsNominee.For so long as the Bonds are registered in the name ofTheDepositoryTrustcompanY,New York,New York,("DTC")or itsnominee,and the book-entry system of DTC shall not have beendiscontinued,notice of intended redemption shall be given only asprovidedintheoperationalarrangementsofDTCthenineffectinaccordancewiththeBlanketIssuerLetterofRepresentationtobedeliveredbytheCitytoDTC.The City will agt provide notice toanyBeneficialOwners.
B.After Book-Entry System Discontinued.If the BondscalledforredemptionarenolongerheldinimmobilizedformbyDTCoritsnomineeasreferencedintheprecedingSubsection6.A,notice of any such redemption shall be given as set forth in thissection.
C.Redemption Notice.Notice of any intendedredemptionshallbegivennotlessthan30normorethan60dayspriortothedatefixedforredemptionbyfirstclassmail,postageprepaid,to the registered owner of any Bond to be redeemed at theOaddressappearingontheBondRegister.In the event that theBondstoberedeemedareregisteredtoDTCoritsnomineeundertheLetterofRepresentationsreferencedinSubsection6.A above,theBondRegistrarshallgivenoticetoDTCwithinthetimessetforthaboveinaformthatwill,at the minimum,state the redemptiondateandidentifytheBondstoberedeemedbyreferencetotheirnumbersandtheparamount,redemption price and amount of accruedinteresttobepaidontheredemptiondate,and shall furthercontainastatementthatinterestshallceasetoaccruefromandaftertheredemptiondate.Any notice given to DTC in accordancewiththeprecedingsentencemaybedeliveredbytheBondRegistrartoDTCinanymanneragreedbetweentheBondRegistrarandDTC,
1998 LTSO Bond ordinance -Page 4
provided that the manner of delivery shall return to the BondRegistrargoodandtimelyevidencethatthenotice,containing theforegoinginformation,was received by the appropriate departmentandofficerofDTC.
D.Interest Ceases to Accrue on Redemption Date.
Interest on any Bonde so called for redemption shall cease on suchredemptiondateunlessthesameshallnotberedeemeduponpresentationmadepursuanttosuchcall.
O E.Failure of Delivery of Notice of Redemption Shall
Not Affect Validity of Call.In the event that the Registered
Dwners of Bonds called for redemption are other than DTC or itsnominee,the requirements of this Section 6 shall be deemed to becompliedwithwhennoticeismailedashereinprovided,regardlessofwhetherornotitisactuallyreceivedbytheownerofanyBond.
In the event that DTC or its nominee is theregisteredownerofanyBondscalledforredemption,the City shallhavenoliabilityforfailureofDTCtoprovidenoticesorothercommunicationstoDTCparticipantsand/or by DTC participants toBeneficialOwnersaftertheCityhasgivensufficientandtimelynoticetotheBondRegistrartoissuethenoticeofredemptionandtheBondRegistrarshallhavenoliabilityifithasonfiletheappropriateevidenceofreceiptofnoticebyDTC,nor shall anyfailureofnoticeorcommunicationbyDTCand/or by DTCparticipantsand/or by any other nominees of Beneficial Ownersaffectthevalidityoftheredemption.
Section 7.Security.The City hereby irrevocable pledgesitselftobudgetandappropriatefromannualtaxleviesavailabletotheCitywithoutavoteofthepeopleamountssufficient,together with other monies legally available therefor,to pay theprincipalofandinterestontheBondsasthesameshallbecomedue.The full faith,credit and resources of the City are hereby0irrevocablypledgedforthepaymentoftheprincipalofandinterestontheBonds,
section 8.Bond Redemption Fund.There is hereby created andestablishedintheofficeoftheFinanceDirectorofthecity(the"Treasurer")a special fund of the City known as the "Limited TaxGeneralObligationBondRedemptionFund,1998"(the "Bond Fund"),which Fund is to be drawn upon for the sole purpose of paying theprincipalofandinterestontheBonds.The City hereby covenantstodepositintheBondRedemptionFundonorbeforeeachinterestpaymentdateamountssufficient,together with monies otherwiseavailabletherein,to pay the principal of and interest on theBondswhendue.
Section 9.Tax code Covenant.The City hereby covenants andagreeswiththeownersoftheBondsfromtimetotimethatthecitywillnotmakeanyuseoftheproceedsoftheBonds,or any othermoneysorobligationsheldunderthisordinanceforanypurpose,nor shall the City take any other action or fail to take anynecessaryaction,which would cause the Bonds to be (i)narbitragebonds"within the meaning of the Code or (ii)a "privateactivitybond"under the Code.The city further covenants that it will notaccumulateandinvestata"yield materially higher"than the"yield"on the Bonds any amounts in a "sinkingfund,"as such termsmaybedefinedintheCode,if such accumulation and investmentwouldcausetheBondstobecome"arbitragebonds"within themeaningofSection148oftheCode.
Section 10.Defeasance.In the event that monies areirrevocablysetasideinaspecialescrowfund(the "Escrow Fund")on the terms and conditions set forth in this section below torefundalloranypartoftheBonds,with respect to the Bonds sorefunded:
A.Payments into the Bond Redemption Fund for paymentofprincipalofandinterestonsuchBondsshallbediscontinued;
199sucesordorelimme -Page 5
B.Such Bonds shall cease to be entitled to any lien,benefit or security of this ordinance except the right to receivethemoniessosetaside;and
C.Such Bonds shall be deemed not to be outstandingunderthisordinance;provided,that any such Bonds shall be deemedtobeoutstandingforthepurposeoftransfers,exchanges or thereplacementoflostordestroyedBondspursuanttothisordinance.
The Escrow Fund shall be established with a corporatefiduciaryqualifiedtodobusinessintheStateofWashingtonand:
1.Monies set aside in said Escrow Fund shall beirrevocablypledgedtopayprincipalofandredemptionpremium,if any,and interest on the refunded Bonds;and
2.Said monies shall be held in cash and/or "governmentobligations"as defined in Chapter 39.53 RCW;provided,however,if the insurance policy issued by MBIA shall be inforceatthetimeofdefeasanceofanyBonds,the Escrow FundshallbeheldonlyinsuchinvestmentsasarepermittedbyAppendixBtothisordinance,which Appendix shall have thesameeffectasifsetforthinthisspace;and
3.Such government obligations shall mature at suchtimeortimesandbearinterestatsuchratestoprovidewithoutanyreinvestmentthereofsufficientamountstopayinterestontherefundedBondswhendueandtoredeemandretiretherefundedBondsattheirrespectivematuritydates,mandatory redemption dates,and/or pursuant to an irrevocablecallofanyorallsuchrefundedBondsforredemption inaccordancewiththeirterms;and
4.The sufficiency of such cash and governmentobligationstomakesuchpaymentsshallhavebeenverified byanindependentcertifiedpublicaccountant.
Within 30 days of any defeasance of any of the Bonds,the Cityshallprovide,or cause to be provided,notice of defeasance ofsuchBondstotheregisteredownersthereof,to the Insurer and toeachNRMSIRandSID,if any,in accordance with Sections 19 and 20,respectively,of this ordinance.
Section 11.Form of Bonds.The Bonds shall be typewritten,printed,lithographed or engraved on good bond paper insubstantiallyoneofthefollowingforms.
A.Held in Book-Entry Form By the Nominee of DTC.
UNITED STATES OF AMERICA
NO.$
CITY OF MOSES LAKE,WASHINGTON
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND,1998
INTEREST RATE:MATURITY DATE:CUSIP NO.:
SEE REVERSE SIDE FORCERTAINDEFINITIONS
REGISTERED OWNER:CEDE &CO.
PRINCIPAL AMOUNT:DOLLARS
The city of Moses Lake Washington,a municipal corporationorganizedandexistingunderandbyvirtueofthelawsoftheStateofWashington,(the ucity")for value received hereby promises topaytotheRegisteredOwneridentifiedabove,or registeredassigns,on the respective Maturity Dates specified above,thePrincipalAmountindicatedaboveandtopayinterestthereonfromthedateofthisbond,or the most recent date to which interest
1998 LTSO Bonci Ordinance -Page 6
has been paid or duly provided for,until the payment of this bondattheInterestRateperannumsetforthabove,payablesemiannuallyonthefirstdaysofeachFebruaryandAugust,commencing August 1,1998,to and including its Maturity Date andwithfullobligationoftheCitytopayinterestatthesameratefromandafterthebondmaturitydateuntilthisbondwithinterestispaidinfull,or funds are available in the "City of Moses Lake,Washington,Limited Tax General Obligation Bond Redemption Fund,1998"(the "Bond Redemption Fund")for payment in full.
O Both principal of and interest on this bond are payable inlawfulmoneyoftheUnitedStatesofAmerica.Both principal andinterestshallbepaidbywiretransferinaccordancewithwiretransferinstructionssubmittedbytheRegisteredownerofthisBondtotheBondRegistrarpriortotherespectiveprincipalandinterestpaymentdates.Principal at maturity shall be payableuponpresentationandsurrenderofthiscertificatebytheRegisteredOwnertoeitherofthefiscalagenciesoftheStateofWashingtoninthecitiesofSeattle,Washington,and New York,NewYork,(the "Bond Registrar").
Reference is hereby made to additional provisions of this bondsetforthonthereversesidehereofandsuchadditionalprovisionsshallforallpurposeshavethesameeffectasifsetforthinthisspace.
The bonds of this issue has been designated by the BondOrdinancetobequalifiedtax-exempt obligations pursuant toSection265(b)(3)of the Internal Revenue Code of 1986 relating tofinancialinstitutions.
It is hereby certified that all acts,conditions and thingsrequiredbytheconstitutionandlawsofthestateofWashingtonandordinancesandresolutionsoftheCitytobedone,to happen ortobeperformedasconditionsprecedenttotheissuanceofthisObondhavebeendone,have happened and have been performed asrequiredbylaw.
This bond shall not become valid or obligatory for any purposeorbeentitledtoanysecurityorbenefitundertheBondOrdinanceuntilthecertificateofauthenticationsetforthhereonhasbeenmanuallysignedbytheBondRegistrarandthisbondhasbeenphysicallydeliveredto,and has been received by,the RegisteredDwnersetforthabove.
IN WITNESS WHEREOF,the city has caused this bond to be signedbythemanualorfacsimilesignatureofitsMayor,attested by themanualorfacsimilesignatureofitscityClerkanditscorporatesealtobeimpressedhereonthis1stdayofJanuary,1998.
CITY OF MOSES LAKE,WASHINGTON
By (manual or facsimile signature)
MayorAttest:
(manual or facsimile signature)City Clerk
Date of Authentication:
CERTIFICATE OF AUTHENTICATION
This bond is the fully registered city of Moses LakeWashington,"Limited Tax General Obligation Refunding Bond,1998"described in the within mentioned bond ordinance .
WASHINGTONSTATE FISCAL AGENCYBondRegistrar
By (manual signature)Authorized Officer
1998 LTao sonciordinance -Page 7
B.Transferred to Individual Bond Owners
UNITED STATES OF AMERICA
NO.
CITY OF MOSES LAKE,WASHINGTON
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND,1998
INTEREST RATE:MATURITY DATE:CUSIP NO.:
SEE REVERSE SIDE FOR
CERTAIN DEFINITIONS
REGISTERED OWNER:
PRINCIPAL AMOUNT:DOLLARS
The City of Moses Lake Washington,a municipal corporationorganizedandexistingunderandbyvirtueofthelawsofthestateofWashington,(the "City")for value received hereby promises topaytotheRegisteredOwneridentifiedabove,or registeredassigns,on the Maturity Date specified above,the Principal Anountindicatedaboveandtopayinterestthereonfromthedateofthisbond,or the most recent date to which interest has been paid ordulyprovidedfor,until the payment of this bond at the InterestRateperannumsetforthabove,payable semiannually on the first
days of each February and August,commencing August 1,1998,to andincludingitsMaturityDateandwithfullobligationoftheCitytopayinterestatthesameratefromandafterthebondmaturitydateuntilthisbondwithinterestispaidinfull,or funds areavailableinthe"City of Moses Lake,Washington,Limited TaxGeneralObligationBondRedemptionFund,1998n (the nBondRedemptionFund")for payment in full.
Both principal of and interest on this bond are payable inlawfulmoneyoftheUnitedStatesofAmerica.Interest shall bepaidbycheckordraftmailedtotheRegisteredOwnerorassignsattheaddressappearingontheregistrybooksoftheBondRegistrar
on the 15th day of the month preceding the interest payment date.Principal shall be payable upon presentation and surrender of thiscertificatebytheRegisteredOwnerorassignsattheprincipalofficeofeitherofthefiscalagenciesoftheStateofWashingtoninthecitiesofSeattle,Washington,and New York,New York (the"Bond Registrar").
Reference is hereby made to additional provisions of this bondsetforthonthereversesidehereofandsuchadditionalprovisionsshallforallpurposeshavethesameeffectasifsetforthinthisspace.
The bonds of this issue have been designated by the Bondordinancetobequalifiedtax-exempt obligations pursuant toSection265(b)(3)of the Internal Revenue Code of 1986 relating tofinancialinstitutions.
It is hereby certified that all acts,conditions and thingsrequiredbytheConstitutionandlawsoftheStateofWashingtonandordinancesandresolutionsoftheCitytobedone,to happen ortobeperformedasconditionsprecedenttotheissuanceofthisObondhavebeendone,have happened and have been performed asrequiredbylaw.
This bond shall not become valid or obligatory for any purposeorbeentitledtoanysecurityorbenefitundertheBondOrdinanceuntilthecertificatedfauthenticationsetforthhereonhasbeenmanuallysignedbytheBondRegistrar.
IN WITNESS WHEREOF,the City has caused this bond to be signedbythefacsimileormanualsignatureofitsMayor,attested by the
1998 LTGOBond Ordinance -Page 8
facsimile or manual signature of its City Clerk and its corporatesealtobeimpressedorafacsimilethereoftobeimprintedhereonthis1stdayofJanuary,1998.
CITY OF MOSES LAKE,WASHINGTON
By (manual or facsimile signature)
Mayor
Attest:
O (manual or facsimile signature)
City Clerk
Date of Authentication:
CERTIFICATE OF AUTHENTICATION
This bond is one of the fully registered City of Moses Lake
Washington,"Limited Tax General Obligation Refunding Bonds,1998"
described in the within mentioned bond ordinance .
WASHINGTON STATE FISCAL AGENCY
Bond Registrar
By (manual signature)
Authorized Officer
C.Statement of Insurance
STATEMENT OF INSURANCE
The MBIA Insurance Corporation (the "Insurer")has issued apolicycontainingthefollowingprovisions,such policy being onfileattheprincipalofficeoftheFiscalAgencyoftheStateofWashingtoninSeattle,Washington,or New York,New York.
The Insurer,in consideration of the payment of the premiumandsubjecttothetermsofthepolicy,unconditionally andirrevocablyguaranteestoanyowner,as hereinafter defined,of thefollowingdescribedobligations,the full and complete paymentrequiredtobemadebyoronbehalfoftheCitytotheFiscal
Agency of the State of Washington,or its successor (the "Paying
Agentu),of an amount equal to (i)the principal of (either at thestatedmaturityorbyanyadvancementofmaturitypursuanttoamandatorysinkingfundpayment)and interest on,the obligations(as that term is defined below)as such payments shall be'come duebutshallnotbesopaid(except that in the event of anyaccelerationoftheduedateofsuchprincipalbyreasonofmandatoryoroptionalredemptionoraccelerationresultingfromdefaultorotherwise,other than any advancement of maturitypursuanttoamandatorysinkingfundpayment,the paymentsguaranteedherebyshallbemadeinsuchamountsandatsuchtimesassuchpaymentsofprincipalwouldhavebeenduehadtherenotbeenanysuchacceleration);and (ii)the reimbursement of any suchpaymentwhichissubsequentlyrecoveredfromanyownerpursuanttoafinaljudgmentbyacourtofcompetentjurisdictionthatsuchpaymentconstitutesanavoidablepreferencetosuchownerwithinthemeaningofanyapplicablebankruptcylaw.The amounts referredtoinclauses(i)and (ii)of the preceding sentence shall bereferredtohereincollectivelyasthe"Insured Amounts.""Obligations"shall mean:
$1,695,000CITYOFMOSESLAKE,WASHINGTONLIMITEDTAXGENERALOBLIGATIONREFUNDING BONDS,1998
Upon receipt of telephonic or telegraphic notice,such noticesubsequentlyconfirmedinwritingbyregisteredorcertifiedmail,or upon receipt of written notice by registered or certified mail,by the Insurer from the Paying Agent or any owner of an ObligationthepaymentofanInsuredAmountforwhichisthendue,thatsuchrequiredpaymenthasnotbeenmade,the Insurer on the duedateofsuchpaymentorwithinonebusinessdayafterreceiptof
1998 LTGOBond ordinance -Page 9
notice of such nonpayment,whichever is later,will make a deposit
of funds,in an account with State Street Bank and Trust Company,
N.A.,in New York,New York,or its successor,sufficient for the
payment of any such Insured Amounts which are then due.Upon
presentment and surrender of such Obligations or presentment of
such other proof of ownership of the Obligations,together with any
appropriate instruments of assignment to evidence the assignment of
the Insured Amounts due on the obligations as are paid by the
Insurer,and appropriate instruments to effect the appointment of
the Insurer as agent for such owners of the Obligations in any
O legal proceeding related to payment of Insured Amounts on the
obligations,such instruments being in a form satisfactory to State
street Bank and Trust company,N.A.,State Street Bank and Trust
Company,N.A.shall disburse to such owners or the Paying Agent
payment of the Insured Amounts due on such Obligations,less any
amount held by the Paying Agent for the payment of such Insured
Amounts and legally available therefor.This policy does not insure
against loss of any prepayment premium which may at any time be
payable with respect to any Obligation.
As used herein,the term "owner"shall mean the registered
owner of any obligation as indicated in the books maintained by the
Paying Agent,the City,or any designee of the city for such
purpose.The term owner shall not include the City or any party
whose agreement with the city constitutes the underlying security
for the Obligations.
Any service of process on the Insurer may be made to the
Insurer at its offices located at 113 King Street,Armonk,New York
10504 and such service of process shall be valid and binding.
This policy is non-cancelable for any reason.The premium onthispolicyisnotrefundableforanyreasonincludingthepayment
prior to maturity of the Obligations.
MBIA Insurance Corporation
D.Reverse of Either Form of Bond
ADDITIONAL PROVISIONS
This bond is one of an issue of $1,695,000 aggregate principal
amount of bonds of like date,tenor and effect,except as to
number,denomination maturity and interest rate,for the purpose of
refunding the Refunded Bonds in accordance with the Refunding Plan
established by ordinance No.1793 of the City (the nBond
ordinance")and is issued in full compliance with the ordinances
and resolutions of the City and the Constitution and laws of theStateofWashington.Reference is made to the Bond Ordinance for
definition of capitalized terms not otherwise defined in this bond.
The bonds of this issue maturing in the years 1998 through2008,inclusive,are not subject to redemption prior to maturity.
The City has reserved the right,at its option,to redeem the bondsofthisissuematuringonorafterAugust1,2009,in whole,or in
part (maturities to be selected by the City and by lot within amaturityinsuchmannerastheBondRegistrarshalldetermine)onAugust1,2008,and any date thereafter at a price of 100%of theprincipalamount,plus accrued interest to the date of redemption.
Notice of any such intended redemption shall be given not lessOthan30normorethan60dayspriortothedatefixedforredemp-
tion by first class mail,postage prepaid,to the registered ownerofanybondtoberedeemedattheaddressappearingonthebondregister.[Alt.A:The requirements of the Bond Ordinance shall
be deemed to be complied with when a notice containing theinformationrequiredbySection6oftheBondordinancehasbeendeliveredtoTheDepositoryTrustcompany,New York,New York,oritsnomineeandtheBondRegistrarhasreceivedappropriatewritten
acknowledgement of receipt of such notice.][Alt.B:TherequirementsoftheBondOrdinanceshallbedeemedtobecomplied
with when notice is mailed as herein provided,regardless ofwhetherornotitisactuallyreceivedbytheownerofanybond.]
1998 LTGOBondOrdinance -Page 10
Interest on all of such bonds so called for redemption shall
cease to accrue on the date fixed for redemption unless such bond
or bonds so called for redemption are not redeemed upon presenta-tion made pursuant to such call.
The City hereby irrevocably pledges itself to budget andappropriatefromannualtaxleviesavailabletotheCitywithoutavoteofthepeopleamountssufficient,together with other monies
legally available therefor,to pay the principal of and interest onthebondsofthisissueasthesameshallbecomedue,and the full
O faith,credit and resources of the City are hereby irrevocably
pledged for the payment of the principal of and interest on suchbonds.
This bond is transferable only on the records maintained by
the Bond Registrar for that purpose by surrender of thiscertificatetotheBondRegistrardulyassignedandexecutedasindicatedhereon.This bond is interchangeable for bonds of anydenominationauthorizedbytheBondordinanceofanequalaggregateprincipalamountandofthesameinterestrateandmaturity.Portions of the principal amount of this bond in increments of$5,000 may also be redeemed as set forth above,and if less thanalloftheprincipalamounthereofistoberedeemed,upon thesurrenderofthisbondattheprincipalofficeoftheBond
Registrar there shall be issued to the registered owner,without
charge therefor,for the then unredeemed principal balance hereof
a bond or bonds,at the option of the owner,of like maturity andinterestrateinanyofthedenominationsauthorizedbytheBondOrdinance.The Bond Registrar shall not be obliged to transfer orexchangethisbondduringthefifteendaysprecedinganyinterestpaymentdateorthedateonwhichnoticeofredemptionofsuchbondistobegivennoraftersuchnoticehasbeengiven.
E.Form of Assignment.The following form ofassignmentshallbeimprintedontheBonds:0 The following abbreviations,when used in the inscription on thefaceofthewithinbond,shall be construed as though they werewrittenoutinfullaccordingtoapplicablelawsorregulations:
TEN CUM -as tenants in commonTENENT-as tenants by the entireties
JT TEN -as joint tenants with right of survivorship and notastenantsincommon
UNIF (GIFT)(TRANSFER)MŒN ACT Custodian
(Custodian)
under Uniform
(Minor)(State)(Gifts)(Transfers)to Minors Act
Additional abbreviations may also beusedthoughnotinlistabove
ASSIGNMENT
FOR VALUE RECEIVED,the undersigned hereby sells,assigns andtransfersunto
PLEASE INSERT SOCIAL SECURITY ORTAXPAYERIDENTIFICATIONNUMBER
(Please print or typeNrite name and acicIress,including zip code of Transferee)
1998LTGOBedordiname -Page 11
the within bond and does hereby irrevocably constitute and appoint
or its successor,as Bond Registrar,to transfer said bond on thebookskeptforregistrationthereofwithfullpowerofsubstitutioninthepremises.
DATED:
SIGNATURE GUARANTEED:
NOTE:Signature must be NOTE:The signature on this Assign
guaranteed by member firm of ment must correspond with the name of
the New York Stock Exchange the registered owner as it appears
or a commercial bank or upon the face of the within bond in
or trust company.every particular,without alteration
or enlargement or any change
whatever.
Section 12.Execution and Authentication of the Bonds.The
Bonds shall be signed on behalf of the City with the facsimile ormanual.signature of the Mayor,shall be attested by the facsimile
or manual signature of the City Clerk and shall have the corporate
seal of the City impressed or a facsimile thereof imprinted
thereon.
Only such bonds as shall bear thereon a Certificate of Authen-
tication in the form set forth in Section 11 of this ordinance,
manually executed by the Bond Registrar,shall be valid orobligatoryforanypurposeorentitledtothebenefitsofthisordinance.Such certificate of Authentication shall be conclusive
0 evidence that the Bonds so authenticated have been duly executed,authenticated and delivered hereunder and are entitled to thebenefitsofthisordinance.
In case either of the officers who shall have executed theBondsshallceasetobesuchofficerorofficersoftheCitybeforetheBondssosignedshallhavebeenauthenticatedordeliveredby
the Bond Registrar,or issued by the City,such bonds may neverthe-
less be authenticated,delivered and issued and,upon such authen-tication,delivery and issuance,shall be as binding upon the City
as though those who signed the same had continued to be suchofficersoftheCity.Any bond may also be signed and attested onbehalfofthecitybysuchpersonsasattheactualdateofexecutionofsuchbondshallbetheproperofficersofthecityalthoughattheoriginaldateofsuchbondanysuchpersonshallnothavebeensuchofficeroftheCity.
Section 13.Bond Registrar.The Bond Registrar shall keep,
or cause to be kept,sufficient books for the registration andtransferoftheBonds.The Bond Registrar is authorised,on behalfoftheCity,to deliver a substitute Bond or Bonds in thedenomination,and bearing the same number,interest rate andmaturitydateforanybondstransferredorexchangedinaccordancewiththeprovisionsofsuchbondsandthisordinanceandtocarryoutalloftheBondRegistrar's powers and duties under thisordinance.
Unless the book-entry system referenced in Subsection 6.A ofthisordinancehasbeendiscontinued,the City and the BondRegistrarwillrecognizeDTCoritsnomineeastheregisteredowneroftheBonds.
Section 14.Lost or Destroyed Bonds.In case the Bonds shallbelost,stolen or destroyed,the Bond Registrar may authenticatedanddeliveranewbondoflikedate,principal amount,maturity,interest rate,tenor and effect to the registered owner or nomineeinthemannerprovidedbylawandupontheowner's paying theexpensesandchargesoftheCityinconnectiontherewithandupon
1998 LTSO Bond Ordinance -Page 12
its filing with the Bond Registrar evidence satisfactory to said
Bond Registrar that such Bond was actually lost,stolen ordestroyedandoftheownershipthereof,and upon furnishing theCitywithindemnitysatisfactorytothemboth.
Section 15.Findings and Designation of Bank Eligibility.
The city Council hereby finds and determines that the City does notexpecttoissuemorethan$10,000,000 aggregate principal amount ofobligationstheinterestonwhichisorwillbeexcludedfromgrossincomeundertheCode,including but not limited to revenue bondsOandnotes,general obligation bonds and notes,local improvementdistrictbondsandnotes,revenue anticipation notes,and lease
purchase or installment purchase contracts in calendar year 1998;and,therefore,the City Council hereby finds and determines thattheBondsare,and are hereby designated to ber qualified tax-exempt obligations pursuant to Section 265(b)(3)of said Coderelatingtofinancialinstitutions.
Section 16.Refunding Plan.Refunding of the Refunded Bonds.
A.Appointment of Refunding Trustee.Chase Manhattan
Trust Co.,NA,Seattle,Washington,and New York,New York,isherebyappointedtoactasRefundingTrusteetocarryouttheRefundingPlansetforthinthisSection16.
B.Refunding Escrow Account Established.There isherebyestablishedintheaccountsoftheCityanaccounttobedesignatedthe"1998Refunding Escrow"which shall constitute anescrowaccountsolelyforthepurposesofpayingtheinterestandredemptionpremium,if any,on and principal amount of the Refunded
Bonds in accordance with the Refunding Plan and of paying the costs
of issuance of the Bonds and other costs of carrying out theRefundingPlan.
C.Application of Bond Proceeds.The proceeds of theOsaleoftheBonds,except the accrued interest which shall be
deposited in the Bond Redemption Fund,shall be depositedimmediatelyuponthereceiptthereofwiththeRefundingTrustee topurchasetheAcquiredObligationsforandestablishabeginningcashbalanceinthe1998RefundingEscrowandtherebytodischarge
the obligations of the City relating to the Refunded Bonds,issuedpursuanttoOrdinancesNo.1435 and No.1526 of the City (collec-tively,the "Refunded Bond Ordinances")and to pay costs ofissuanceoftheBondsandcostsrelatedtocarryingouttheRefundingPlan.
D.Acquisition of Acquired Obligations.SuchobligationsshallbedischargedfullybytheRefundingTrustee'ssimultaneouspurchaseofAcquiredobligationsbearingsuchinterestratesandmaturingastoprincipalandinterestinsuchamountsandatsuchtimessoastoprovideforthepaymentoftheamountsrequiredtobepaidbytheRefundingPlan.The Acquired
Obligations are listed and more particularly described in Exhibit AattachedtotherefundingtrustagreementauthorizedbySubsection16.D of this ordinance.
E.Right of substitution Reserved.The City reservestherighttosubstitutehigheryieldinggovernmentobligations intheeventitmaydosopursuanttothecode,provided that at alltimesthemoniesandAcquiredObligationsdepositedintheRefundingEscrowshallbesufficientastotypeandamounttoOprovideforthepaymentoftheprincipalofandinterestontheRefundedBondsasprovidedherein.Prior to any such substitution,the City shall obtain (1)a verification by an independentcertifiedpublicaccountantwhichshallbesatisfactorytotheCity
and to bond counsel to the city that the monies and governmentobligationsondepositaftersuchsubstitutionwillbesufficient
as provided above and (2)an opinion from such bond counsel thatsuchsubstitutionshallnotcauseanyoftheinteresttobepaidontheBondstoloseitsexclusionfromgrossincomeunderSection103oftheCode.
1998 LTGOBond Ordinance -Page 13
F.Administration of Refunding Plan.The RefundingTrusteeisauthorizedanddirectedtopurchasetheAcquiredObligationsandtomakethepaymentsrequiredtobemadebytherefundingtrustagreementfromtheAcquiredObligationsandmoneydepositedwiththeRefundingTrusteepursuanttothisordinance.All Acquired Obligations and the money deposited with the RefundingTrusteeandanyincometherefromshallbeheldirrevocably,invested and applied in accordance with the provisions of theRefundedBondOrdinancesandthisordinance,Chapter 39.53 RCW andotherapplicablestatutesoftheStateofWashington,and theOrefundingtrustagreementauthorizedbythissection.Allnecessaryandproperfees,compensation and expenses of theRefundingTrusteefortheBondsandallothercostsincidentaltoestablishingtheescrowtoaccomplishtherefundingoftheRefundedBondsandcostsrelatedtotheissuanceanddeliveryoftheBonds,including bond printing,rating service fees,verification fees,financial advisor fees,bond counsel's fees and other relatedexpenses,shall be paid out of the proceeds of the Bonds.
G.Authorization for Refunding Trust Agreement.InordertocarryouttheRefundingPlanprovidedforbythisordina-nce,the Mayor and City Clerk are authorized and directed toexecuteanddelivertotheRefundingTrusteearefundingtrustagreementsubstantiallyintheformattachedtothisordinanceasAppendixA,and by this reference made a part hereof,setting forththeduties,obligations and responsibilities of the RefundingTrusteeinconnectionwiththepayment,redemption and retirementoftheRefundedBondsasprovidedhereinandstatingthat theprovisionsforpaymentofthefees,compensation and expenses oftheRefundingTrusteesetforththereinaresatisfactorytoit.Prior to executing the refunding trust agreement,the Mayor andCityClerkareauthorizedtomakesuchchangesthereinwhichdonotchangethesubstanceandpurposethereoforwhichassurethattheescrowprovidedthereinandtheBondsareincompliancewiththerequirementsoffederallawgoverningtheexclusionofinterestonOtheBondsfromgrossincomeforfederalincometaxpurposesastheymaydeemnecessaryorappropriate.
H.Call for Redemption of the Refunded Bonds.The CitycallsthefollowingRefundedBondsforredemption:
(i)On June 1,2000,at a price of 100%of theprincipalamountthereof,the outstanding Limited Tax GeneralObligationBonds,1990 maturing June 1,2001,through June 1,2010,inclusive,in the aggregate principal amount of $450,000.
(ii)on August 1,2000,at a price of 100%of theprincipalamountthereof,the outstanding Limited Tax GeneralObligationBonds,1992 maturing August 1,2001,through August 1,2012,inclusive,in the aggregate principal amount of $825,000.
The foregoing calls for redemption shall beirrevocableafterthedeliveryoftheBondstotheinitialpurchaserthereof.
The proper City officials are authorized anddirectedtocausetheBondRegistrarfortheaforesaidissuesoftheRefundedBondstogivesuchnoticesasrequired,at the timesandinthemannerrequiredbytherespectiveRefundedBondOrdinancesinordertoeffecttherespectivecallsforredemptionpriortomaturityoftheRefundedBondsspecifiedinthissubsection.
Section 17.Sale of Bonds.The proposal of Seattle-NorthwestSecuritiesCorporation,Seattle,Washington,dated December 23,1997,to purchase the Bonds at a price of $1,670,094.25 (par amountof$1,695,000 less $7,955,75 of original issue discount and$16,950.00 of underwriter's discount)and upon the terms andconditionssetforthinsaidproposalandinthisordinanceisherebyaccepted.
Section 18.Authorization to City officials and Agents.TheproperCityofficialsareherebyauthorizedanddirectedtoexecute
1998 LTGOBond ordinance -Page 14
the proposal to purchase the Bonds,to approve an official
statement or other disclosure document for the Bonds,acceptance of
a commitment for insurance from MBIA,and to do everything
necessary and proper to carry out the refunding plan and for the
prompt issuance,execution and delivery of the Bonds in conformance
with the provisions of this ordinance and for the proper use and
application of the proceeds of the sale thereof as provided inSection16ofthisordinance.
Section 19.Undertaking to Provide ongoing Disclosure.
A.Definitions.
1."Commissionn means the Securities and Exchange
commission.
2."MSRB"means the Municipal Securities
Rulemaking Board or any successor to its functions.
3.nNRMSIR"means a nationally recognizedmunicipalsecuritiesinformationrepository.
4."Rule"means the Commission's Rule 15c2-12
under the Securities and Exchange Act of 1934,as the same maybeamendedfromtimetotime.
5."sID"means a state information depository for
the state of washington (if one is created).
B.Contract/Undertaking.This section 19 constitutes
the City's written undertaking for the benefit of the owners andbeneficialownersoftheBondshereafterissuedinaccordancewiththisordinanceasrequiredbySection(b)(5)of the Rule.The cityisanobligatedpersonwithrespecttolessthan$10,000,000 inmunicipalsecurities,including the Bonds.
C.Financial Statements/Operating Data.The City
agrees to provide or cause to be provided to any person uponrequesttotheCityortotheSID,if any,a copy of its latestpubliclyavailableannualfinancialstatementsoftheCitypreparedinaccordancewithregulationsprescribedbytheWashingtonStateAuditorpursuanttoRCW43.09.200 (or any successor statute).
D.Material Events.The City agrees to provide orcausetobeprovided,in a timely manner,to the SID,if any,andtoeachNRMSIRortotheMBREnoticeoftheoccurrenceofanyofthefollowingeventswithrespecttotheBonds,if material:
>Principal and interest payment delinquencies;
>Nonpayment-related defaults;
>Unscheduled draws on any debt service reservesreflectingfinancialdifficulties;
*Unscheduled draws on credit enhancements reflectingfinancialdifficulties;
>Substitution of credit or liquidity providers ortheirfailuretoperform;
O >Adverse tax opinions or events affecting the tax-exempt status of the Bonds;
*Modifications to the rights of holders of theBonds;
>Optional contingent or unscheduled Bond calls(other than scheduled sinking fund redemption forwhichnoticeisgivenpursuanttoExchangeActRelease34-23856);
*Defeasances;
1998 LTGOBond ordinance -Page 15
>Release,substitution or sale of property securingrepaymentoftheBonds;and
>Rating changes.
Solely for purposes of disclosure,and not intending tomodifytheundertaking,the City advises that (i)the only creditenhancementfortheBondswillbeapolicyofinsuranceissued byMBIAand(ii)there is no property securing repayment of the Bonds,as the City lacks legal authority for such measure.If futureOchangesinthelawpermitpledingofpropertyforsuchpurpose,andiftheCitysubsequentlychoosestoprovidesuchpropertyassecurityfortheBonds,the City will provide notice of suchestablishmentorprovisionandundertaketoprovidenoticesofmaterialeventsrelatingthereto,should such events occur.
E.Termination/Modification.The City'sobligations toprovideannualfinancialinformationandnoticesofmaterialeventsshallterminateuponthelegaldefeasancerpriortoredemption,oruponpaymentinfullofalltheBonds.This section,or anyprovisionhereof,shall be null and void if the City (1)obtains anopinionofnationallyrecognizedbondcounseltotheeffectthatthoseportionsoftheRulewhichrequirethissection,or any suchprovisionofthissection,are invalid,have been repealed retro-actively or otherwise do not apply to the Bonds;and (2)notifieseachthenexistingNRMSIRandtheSID,if any,of such opinion andthecancellationofthissectionoranysuchprovision.
Notwithstanding any other provision of this ordinance,the City may amend this Section 19,and any provision of thisSection19maybewaivedwithanapprovingopinionofnationallyrecognizedbondcounsel.
In the event of any amendment or waiver of a provision ofthisSection19,the City shall describe such amendment in the nextOannualreport,and shall include,as applicable,a narrativeexplanationofthereasonfortheamendmentorwaiverand itsimpactonthetype(or in the case of a change of accountingprinciples,on the presentation)of financial information oroperatingdatabeingpresentedbytheCity.In addition,if theamendmentrelatestotheaccountingprinciplestobefollowedinpreparingfinancialstatements,(a)notice of such change shall begiveninthemannerasforamaterialeventunderSubsection16.D,and (b)the annual report for the year in which the change is madeshouldpresentacomparison(in narrative form and also,iffeasible,in quantitative form)between the financial statements aspreparedonthebasisofthenewaccountingprinciplesandthosepreparedonthebasisoftheformeraccountingprinciples.
F.Bond Owner's Remedies Under This section.The rightofanownerorbeneficialownerofaBondtoenforcetheprovisionsofthissectionshallbelimitedtoarighttoobtainspecificenforcementoftheCity's obligations hereunder,and any failure bytheCitytocomplywiththeprovisionsofthisundertakingshallnotbeaneventofdefaultwithrespecttoanyBondsissuedpursuanttothisordinance.For purposes of this Section 19,beneficial owner means any person who has the power,directly orindirectly,to vote or consent with respect to,or to dispose ofownershipof,any Bonds,including persons holding Bonds throughnomineesordepositories.
Section 20.Bond Insurance.
A.Events of Default;Remedies.So long as the BondsareinsuredbyMBIA,occurrence of any of the following shallconstituteanneventofdefaultnunderthisordinance:
1.The city fails to pay principal on anyoutstandingBondswhendue;
2.The City fails to pay interest on anyoutstandingBondswhendue;
1998 LTGOBond Ordinance -Page 16
3.The City fails to observe any other covenant or
condition of this ordinance and such failure continues for thirty
(30)days;and/or
4.The City declares bankruptcy or insolvency
under applicable laws of the United States.
Upon the occurrence of any of the foregoing events of
default,the Insurer,acting alone,shall have the right to direct
all remedies that may be available,including exercise of all
O rights and privileges available to registered owners of the Bonds.
The Insurer shall have the right to institute any suit,action,or
proceeding at law or equity under the same terms as any registered
owner of the Bonds;provided,however,that nothing in this section
shall expand the rights and privileges of registered owners of the
Bonds set forth in this ordinance.Any acceleration of principal
payments other than in the exercise of the rights of redemption
reserved to the City by this ordinance is subject to the prior
written consent of the Insurer.
B.Notices to Insurer.All notices required by this
ordinance to be provided to the Insurer shall be mailed by first
class U.S.mail to MBIA at the following address or in accordance
with any superseding instructions given to the City in writing by
MBIA.Until further notice from MBIA such notices shall be mailed
to:
MBIA Insurance Corporation
ATTN:Insured Portfolio Management
113 King Street
Armonk,NY 10504
(914)273 4545
Section 21.Prior Acts.All acts taken pursuant to the
authority of this ordinance but prior to its effective date are
hereby ratified and confirmed.
Section 22.Severability.If any one or more of thecovenantsoragreementsprovidedinthisordinancetobeperformed
on the part of the City shall be declared by any court of competentjurisdictiontobecontrarytolaw,then such covenant or
covenants,agreement 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 thevalidityoftheotherprovisionsofthisordinanceoroftheBonds.
Section 23.Effective Date.This ordinance shall becomeeffectivefromandafteritspassageandpublicationasrequiredby
law.
PASSED by the City Council of the city of Moses Lake this 23rd
day,of December,1997.
CITY OF MOSES LAKE,WASHINGTON
A
City Clerk
AP TO FOM•
Cit Attorney
1998 LTeo sondordinance -Page 17
REFUNDING TRUST AGREEMENT(EXHIBIT A to Ordinance No.1793)
THIS AGREEMENT,made and entered into as of the day of
January,1998,by and between the City of Moses Lake,Washington,
(the "City")and Chase Manhattan Trust Co.,NA,Seattle,
Washington,corporate fiduciary qualified to do business in the
state of Washington,(the "Escrow TrusteeM .
W I TNESSET H:
Section 1.Recitals.Among the outstanding bonds of the city
are the following limited tax general obligation bonds:
Original Amount To AuthorizingDatedDatePrincipalAmountBeRefundedOrdinance
July 1,1990 $650,000 $530,000 1435*Aug.1,1992 $1,200,000 $1,015,000 1526*
*Collectively,the "Authorizing ordinances."
which mature on the dates and in the amounts and bear interest at
the rates set forth in Appendix 1 (the "1990Refunded Bonds"and
the "1992Refunded Bonds,"respectively,and collectively the
"Refunded Bondsu).By Ordinance No.,adopted December _,
1997;(the "Ordinance"),the city authorized the issuance of the
Limited Tax General obligation Refunding Bonds,1998 of the city
(the "Refunding Bonds").The principal of and interest on the
Refunded Bonds are herein characterized as the "Escrow Debt
Service."Capitalized terms not otherwise defined in this
Agreement shall have the meaning defined in the Ordinance.
The city,by the Ordinance,has determined to refund the
Refunded Bonds in accordance with the terms of and in the manner
provided by the Authori2ing Ordinances and has authorized issuance
of $1,685,000 aggregate original principal amount of Refunding
Bonds dated January 1,1998,to carry out such refunding.
Section 2.Provisions for the Escrow Debt Service.To accom-
plish the defeasance of the Escrow Debt Service,the city,
simultaneously with the delivery of the Refunding Bonds,does
hereby agree to irrevocably deposit with the Escrow Trustee in
trust for the security and benefit of the owners of the Refunded
REFUNDINGTRUST AGREEMENT-Page 1 of 7
Bonds sufficient obligations or evidence thereof ("Acquired
Obligations")as described on Appendix 2 attached hereto,and any
monies,if necessary,to provide for the payment of all Escrow Debt
Service as the same shall become due.The sufficiency of such
Acquired obligations has been verified by ,
certified public accountants.
The Escrow Trustee hereby agrees to create and establish a
special and irrevocable trust fund (the nEscrow Fund")consisting
of the Cash and Acquired Obligations as described on Appendix 2 to
be held in trust by said Trustee separate and apart from all other
funds or accounts of the city or of the Trustee,solely for the
purposes herein specified.
Such Acquired obligations shall be paid for out of a portion
of the proceeds of the sale of the Refunding Bonds and other cash
provided by the city.
Prior to or simultaneously with the delivery of the Refunding
Bonds to the initial purchasers thereof,the City agrees that it
will cause to be delivered to the Escrow Trustee statements setting
forth the schedule of the Escrow Debt Service including the amount
of interest to be paid on each semiannual interest payment date,
the amount of principal of the Refunded Bonds to be paid on each
annual principal payment date,and the amount of principal and
premium,if any,to be paid upon the respective mandatory
redemptions dates set forth below pursuant to the irrevocable call
for redemption made by the Ordinance for the respective issues of
the Refunded Bonds maturing on and after the following maturity
dates:
Date of Issue of Mandatory All Refunded Bonds
Refunded Bonds Redemption Date Maturity Dates
July 1,1990 June 1,2000 June 1,2001 throughJune1,2010
August 1,1992 August 1,2001 Aug.1,2002 throughAug.1,2012
At least seventy (70)days before the respective mandatory
redemption dates,the Escrow Trustee shall notify the Bond
Registrar,with a copy to the City,with respect to the Refunded
REFUNDINGTRUSTAGREEMENT-Page 2 of 7
Bonds of the requirement for mandatory call of the respective
Refunded Bonds and shall cause the Bond Registrar to give notice of
redemption at the time and in the manner required by Authorizing
Ordinances No.1435 and No.1526 for the respective issues of the
1990 and 1992 Refunded Bonds.
Section 3.Disbursements by Escrow Trustee.The Escrow
Trustee shall present for payment on the due dates thereof any
Acquired Obligations so deposited with it and shall apply the
proceeds derived therefrom and the interest paid thereon in
accordance with the provisions of this section.Monies shall be
transferred by the Escrow Trustee to the Finance Director of the
City or,at the direction of said Finance Director,to the Fiscal
Agent of the State of Washington at appropriate times and in
amounts sufficient to pay the principal of and interest on the
Refunded Bonds to and including the respective mandatory redemption
dates,and to pay the principal of and premium,if anY,on the
applicable Refunded Bonds on the respective mandatory redemption
dates.Any cash balance at any time occurring in the Escrow Fund,
shall be held therein and shall not be invested.
Section 4.Custody and Safekeeping of Obligations.For as
long as any of the Refunded Bonds remain outstanding,on or before
the 25th day of each January,March,July and September (commencing
March 25,1998)the Escrow Trustee shall render a statement as of
the last day of the preceding month to the Finance Director setting
forth the cash and Acquired Obligations which have matured and the
amounts received by the Escrow Trustee by reason of such maturity,
the interest earned on any of the Acquired Obligations,a list of
any investments or reinvestments made by the Escrow Trustee in
other Acquired Obligations and the interest and/or principal
derived therefrom,the amounts of cash delivered to the Finance
Director and/or Fiscal Agent of the State of Washington for the
payment of the principal of and premium,if any,and interest on
the Refunded Bonds,as said payments shall become due and payable,
and any other transactions of the Escrow Trustee pertaining to its
duties and obligations as set forth herein.
REFUNDINGTRUST AGitEEMENT-Page 3 of 7
All Acquired Obligations,monies and investment income
deposited with or received by the Escrow Trustee pursuant to this
Agreement shall be subject to the trust created by this Agreement,
and the Escrow Trustee shall be liable for the preservation,
safekeeping and application thereof in accordance with the
provisions of this Agreement;provided,however,it shall not be
responsible for any depreciation in value of any of the Acquired
Obligations.In the event the maturing principal of and interest
on the Acquired Obligations,any obligations substituted for the
Acquired Obligations pursuant to section 5 of this Agreement and
other money held by the Escrow Trustee pursuant to this Refunding
Trust Agreement shall be insufficient or shall be projected to
become insufficient at any time in the future to make the payment
for the Escrow Debt service,the Escrow Trustee shall give the City
and the Bond Registrar prompt notice of such insufficiency or
projected insufficiency.Upon receipt of any such notice,the City
shall promptly deposit with the Escrow Trustee monies in the amount
of such insufficiency;and the Escrow Trustee shall hold such
monies uninvested until applied to payment of Escrow Debt Service.
Any money remaining in the trust fund after payment of all
Escrow Debt Service shall be paid by the Escrow Trustee to the City
for deposit in the Bond Redemption Fund for the Refunding Bonds
then outstanding,otherwise in the General Fund of the city.
Section 5.Substitution of Acquired Obligations.The city
reserves the right to substitute higher yield Acquired Obligations
in the event it may do so pursuant to section 149(d)of the
Internal Revenue Code of 1986,as amended,and applicable Treasury
regulations thereunder;provided that,at all times the monies and
Acquired obligations deposited with the Escrow Trustee shall be
sufficient as to type,maturity date and amount to provide for the
payment of the principal of and interest due and to become due on
the Refunded Bonds as provided herein.Prior to each such
substitution,the City shall obtain (1)a verification by a
certified public accountant which shall be satisfactory to the
Escrow Trustee and to bond counsel to the City that the monies and
REFUNDINGTRUSTAGREEMENT-Page 4 of 7
Acquired Obligations on deposit after such substitution will be
sufficient as provided above,and (2)an opinion from such bond
counsel that such substitution shall not cause any of the Refunding
Bonds to lose their tax-exempt status under Section 103 of the
Internal Revenue Code of 1986,as amended,and applicable Treasury
regulations thereunder.In the event that there shall be excess
cash in the Escrow Fund as a result of any such substitution,such
excess shall be paid to the City;and the city,at its option,
shall transfer such payment to the Bond Redemption Fund or the
General Fund of the City.
Section 6.Costs of Issuance.The City,simultaneously with
the delivery of the Refunding Bonds,does hereby agree to deposit
$to pay the costs of issuance of the Refunding Bonds set
forth in Appendix 3,and the Escrow Trustee hereby agrees to pay
such costs of issuance at closing,or as soon thereafter as
invoices are presented to the Escrow Trustee.
Section 7.Duties and Obligations of the Escrow Trustee.The
duties and obligations of the Escrow Trustee shall be as prescribed
by the provisions of this agreement,and the Escrow Trustee shall
not be liable except for the performance of its duties and obliga-
tions as specifically set forth herein and to act in good faith in
the performance thereof,and no implied duties or obligations shall
be incurred by the Escrow Trustee other than those specified
herein.
None of the provisions contained in this Refunding Trust
Agreement shall require the Escrow Trustee to use or advance its
own funds in the performance of any of its duties or the exercise
of any of its rights or powers hereunder.The Escrow Trustee shall
not be liable for the sufficiency,correctness,genuineness or
validity of the Acquired Obligations or of any substitute obliga-
tions (substituted in accordance with Section 5 of this Agreement)
deposited with it;the performance or compliance by any party other
than the Escrow Trustee with the terms and conditions of any such
instruments;or any loss which may occur by reason of negligence or
willful misconduct of any party other than the Escrow Trustee.
REFUNDINGTRUSTAGREEMENT-Page 5 of 7
The Escrow Trustee may consult with counsel of its choice,and
the opinion of such counsel shall be full and complete authoriza-
tion and protection in respect of any action taken or not taken or
suffered by it hereunder in good faith and in accordance with the
opinion of such counsel.
Section 8.Compensation of Escrow Trustee.The arrangements
heretofore made for the payment of the Escrow Trustee of the amount
of $for services rendered by it pursuant to the provisions
of this Agreement are satisfactory to it;and such payment is
inclusive of all fees,compensation and expenses of the Escrow
Trustee.
Section 9.Indemnification.To the extent permitted by law,
the City hereby assumes liability for,and hereby agrees (whether
or not any of the transactions contemplated hereby are consummated)
to indemnify,protect,save and keep harmless the Escrow Trustee
and its respective successors,assigns,agents,employees and
servants,from and against any and all liabilities,obligations,
losses,damages,penalties,claims,actions,suits,costs,expenses
and disbursements (including reasonable legal fees and
disbursements)of whatsoever kind and nature which may be imposed
on,incurred by,or asserted against,the Escrow Agent at any time
(whether or not also indemnified against the same by the City or
any other person under any other agreement or instrument,but
without double indemnity)in any way relating to or arising out of
the execution,delivery and performance of this Agreement,the
establishment hereunder of the Escrow Fund,the acceptance of the
funds and securities deposited therein,the purchase of any
securities to be purchased pursuant thereto,the retention of such
securities or the proceeds thereof and any payment,transfer or
other application of moneys or securities by the Escrow Agent in
accordance with the provisions of this Agreement;provided,
however,that the City shall have no liability to the Escrow Agent
(or any of its successors,assigns,agents,employees and servants)
with respect to any action or failure to act which constitutes
negligence or willful misconduct of the Escrow Agent or any of the
REFUNDINGTRUSTAGREEMENT-Page 6 of 7
Escrow Agent's respective successors,assigns,agents and employees
or the material breach by any of the same of the terms of this
Agreement.In no event shall the City or the Escrow Agent be
liable to any person by reason of the transactions contemplated
hereby other than to each other as set forth in this Section.The
rights,obligations,terms and conditions contained in this section
shall survive the termination of this Agreement.
section 10.Applicable Law;Severability.This Refunding
Trust Agreement is governed by Washington law and may not be
modified except by a writing signed by the parties.In the event
any one or more of the provisions contained in this Refunding Trust
Agreement shall for any reason be held to be invalid,illegal or
unenforceable in any respect,such invalidity,illegality or
unenforceability shall not affect any other provision of this
Refunding Trust Agreement,but this Refunding Trust Agreement shall
be construed as if such invalid or illegal or unenforceable
provision had never been contained herein.
IN WITNESS WHEREOF,the parties have executed and delivered
this Refunding Trust Agreement pursuant to due and proper authori-
zation,all as of the date and year first above written.
CITY OF MOSES LAKE,WASHINGTON
[SEAL]
By
yorATTE
City Cl
CHASE MANHATTAN TRUST CO.,NA
Seattle,Washington
By
Trust Officer
O
REFUNDINGTRUSTAGREEMENT-Page 7 of 7
CITY OF MOSES LAKB,WASHINGTON
REFUNDING TRUST AGREEMENT
Appendix 1
Refunded Bond Schedules
I.Maturity Schedule of Refunded Bonds:
A.Limited Tax General obligation Bonds,1990 ("1990 Refunded
Bonds")
Maturity Date Amount Interest Rate
June 1,1998 $25,000 7.00%
June 1,1999 25,000 7.10%June 1,2000 30,000 7.20%
June 1,2001 30,000 7.25%
June 1,2002 35,000 7.30%
June 1,2003 35,000 7.30%
June 1,2004 40,000 7.35%
June 1,2005 40,000 7.35%June 1,2006 45,000 7.40%
June 1,2007 50,000 7.40%June 1,2008 55,000 7.40%June 1,2009 -60,000 7.40%
June 1,2010 60,000 7.40%$530,000
B.Limited Tax General obligation Bonds,1992 ("1992 RefundedBonds")
Maturity Date Amount Interest Rate
August 1,1998 $45,000 5.40%
August 1,1999 45,000 5.55%August 1,2000 50,000 5.65%August 1,2001 50,000 5.80%August 1,2002 55,000 5.90%August 1,2003 55,000 6.00%August 1,2004 60,000 6.10%August 1,2005 65,000 6.20%
August 1,2006 70,000 6.25%August 1,2007 75,000 6.30%
August 1,2008 75,000 6.35%August 1,2009 80,000 6.40%
August 1,2010 90,000 6.45%August 1,2011 100,000 6.50%August 1,2012 100,000 6.50%$1,015,000
II.Payment Schedule for Refunded Bonds:
A.Limited Tax General Obligation Bonds,1990 ("1990 RefundedBonds")
Principal or Interest TotalPaymentDateRedemptionPricePaymentPayment
June 1,1998 $25,000.00 $19,415.00 $44,415.00Dec.1,1999 18,540.00 18,540.00June1,1999 25,000.00 18,540.00 43,540.00Dec.1,2000 17,652.50 17,652.50June1,2000 480,000.00 17,652.50 497,652.50
TOTALS $530,000.00 $91,800.00 $621,800.00
B.Limited Tax General obligation Bonds,1992 ("1992 Refunded
Bonds")
Principal or Interest Total
Payment Date Redemption Price Payment Payment
Feb.1,1998 $$31,337.50 $31,337.50
Aug.1,1998 45,000.00 31,337.50 76,337.50
Feb.1,1999 30,122.50 30,122.50
Aug.1,1999 45,000.00 30,122.50 75,122.50OFeb.1,2000 28,873.75 28,837.75Aug.1,2000 50,000.00 28,873.75 78,873.75Feb.1,2001 27,461.25 27,461.25Aug.1,2001 875,000.00 27,461.25 902,461.25
TOTALS $1,015,000.00 $235,590.00 $1,250,590.00
0
CITY OF MOSES LAKE,WASHINGTON
CERTIFICATE OF REFUNDING TRUSTEE
EXHIBIT B
Payment Schedule for Refunded Bonds
A.Limited Tax General Obligation Bonds,1990 ("1990 Refunded Bonds")
Principal or Interest TotalPaymentDateRedemptionPricePaymentPayment
June 1,1998 $25,000.00 $19,415.00 $44,415.00Dec.1,1999 18,540.00 18,540.00June1,1999 25,000.00 18,540.00 43,540.00Dec.1,2000 17,652.50 17,652.50June1,2000 480,000.00 17 652.50 497,652.50
TOTALS $530,000.00 $91,800.00 $621,800.00
B.Limited Tax General Obligation Bonds,1992 (n1992 Refunded Bonds")
Principal or Interest TotalPavmentDateRedemptionPricePaymentPayment
Feb.1,1998 $$31,337.50 $31,337.50Aug.1,1998 45,000.00 31,337.50 76,337.50Feb.1,1999 30,122.50 30,122.50Aug.1,1999 45,000.00 30,122.50 75,122.50Feb.1,2000 28,873.75 28,837.75Aug.1,2000 50,000.00 28,873.75 78,873.75Feb.1,2001 27,461.25 27,461.25Aug.1,2001 875,000.00 27,461.25 902,461.25
TOTALS $1,015,000.00 $235,590.00 $1,250,590.00
O
CITY OF MOSES LAKE,WASHINGTON
REFUNDING TRUST AGREEMENT
Appendix 3
Costs of Issuance
Amount Payee and Purpose
$Chase Manhattan Trust Co.,RA for
Escrow Trustee fee
Rose Marie Van Winkle for special
counsel and legal opinions fee
and out-of-pocket expenses.
for escrowverification
Moody's Investors Service for rating
agency fee
Standard &Poor's Corporation forratingagencyfee
O Seattle-Northwest Securities
Corporation for printing
official statements
CUSIP Service Bureau for CUSIP
number assignment
Contingencies
$TOTAL
0
CITY OF MOSES LAKE,WASHINGTON
REFUNDING TRUST AGREEMENT
(Iþ .Appendix 2
Cash and Acquired Obligations
Beginning Cash $
Acquired Obligations
Security Principal Maturity InterestTypeAmountDateRate
TBill $.Feb.1,1998 %TBill June 1,1998 %TBill Aug.1,1998 %TBill Dec.1,1998 %TNote Feb.1,1999 %TNote June 1,1999 %TNote Aug.1,1999 %TNote Dec.1,1999 %TNote Feb.1,2000 %TNote June 1,2000 %TNote Ausg.1,2000 %0 TNote Feb.1,2001 %TNote Aug.1,2001 %TNote Dec.1,1998 %
9
EXHIBIT B
PERKITTED INVESTMENTS FOR ANYESCROWFUNDESTABLISHEDPURSUANT TOSECTION10OFORDINANCENO.1793
Defeasance requires the deposit of:
1.Cash.
2.U.S.Treasury Certificates,Notes and Bonds (including StateandLocalGovernmentSeries--nSLGs").
3.Direct obligations of the Treasury which have been strippedbytheTreasuryitself,CATS,TIGRS and similar securities.
4.Resolution Funding Corp.(REFCORP):Only the interestcomponentofREFCORPstripswhichhavebeenstrippedbyrequesttotheFederalReserveBankofNewYorkinbookentryformareacceptable.
5.Pre-refunded municipal bonds rated "Aaan by Moody's and"AAA"by S&P.If,however,the issue is only rated by S&P (i.e.,there is no Moody's rating),then the pre-refunded bonds must havebeenpre-refunded with cash,direct U.S.or U.S.guaranteedobligations,or AAA rated pre-refunded municipals to satisfy thiscondition.
6.Obligations issued by the following agencies which arebackedbythefullfaithandcreditoftheU.S.:
a.U.S.Export-Import Bank (Eximbank)
Direct obligations or fully guaranteed certificates ofbeneficialownership
b.Farmers Home Administration (FmKA)
Certificates of beneficial ownership
c.Federal Financing Bank
d.General Services Administration
Participation certificates
e.U.S.Maritime Administration
Guaranteed Title XI financing
f.U.S.Department of Housing and Urban Development (HUD)
Project Notes
Local Authority Bonds
New Communities Debentures -U.S.government guaranteeddebentures
U.S.Public Housing Notes and Bonds -U.S.governmentguaranteedpublichousingnotesandbonds*
Page 1 of 2
DitAFT:December 17,1997
agreements in this ordinance and shall in no way affect thevalidityoftheotherprovisionsofthisordinanceoroftheBonds.
Section 22.Effective Date.This ordinance shall becomeeffectivefromandafteritspassageandpublicationasrequiredbylaw.
O PASSED by the City Council of the City of Moses Lake this 23rddayofDecember,1997.
[SEAL]
ST
City Cler
/ity Attorney
PUBLISHED:12/26/97
e
9
1998 LTSOBond Ordinance -Page 16