2142_00001ORDINANCENO.2142
ANORDINANCEoftheCityofMoses Lake,Washington,authorizingtheissuance and sale oflimited
tax general obligation refunding bonds of the City in the aggregate principal amount of $2,725,000
to provide funds torefundcertainoutstandinggeneral obligationbonds ofthe City;providingthe date,
form and redemption provisions of said bonds;providing for thedisposition ofthebond proceeds;providing for theannuallevy oftaxestopay theprincipal of and interest on the bonds;approving anundertakingforongoingdisclosure;and authorizingthe sale of bonds.
WHEREAS,the CityofMoses Lake,Washington (the"City")issued its LimitedTax General Obligation Bond,
O 1997 to the United States Department of Agriculture pursuant to Ordinance No.1758 (the"1997Bond
Ordinance")under date of March 20,1997,in theoriginalaggregate principalamount of $3,020,300(the"1997Bond")which remains outstanding in theamount of $2,673,997.97;and
WHEREAS,the1997 Bond Ordinanceauthorizesthedefeasance and prepaymentofthe1997 Bond,withoutpenaltyorpremium,inwhole,or in part at any time;and
WHEREAS,after due considerationit appears to thisCouncil thatthe 1997 Bond may be defeased andrefundedbytheproceedsofthebondshereinauthorizedintotalprincipalamountof$2,725,000authorizedherein(the"Bonds")at a substantial savings to the Cityand itstaxpayers;and
WHEREAS,the City has received an offerfromMartin Nelson&Company,Inc.,Seattle,Washington,topurchasetheBonds;
NOW,THEREFORE,THE CITYCOUNCILOF THE CITYOF MOSESLAKEDOORDAIN,as follows:
Section 1.Definitions The following words and terms as used in thisordinanceshall have thefollowing
meanings for allpurposes ofthisordinance,unless some other meaning is plainlyintended.
Beneficial Owner means any person thathas or shares thepower,directly or indirectlyto make investment
decisions concerning ownership of any Bonds (includingpersons holding Bonds throughnominees,
depositories or other intermediaries).
Bond Fund meansthe"LimitedTax General Obligation Refunding Bond Redemption Fund,2003"establishedpursuanttoSection8hereof.
Bond Insurance Policy means the municipal bond insurance policyissued by the Insurer insuring thepaymentwhendueoftheprincipalofandinterestontheBondsasprovidedtherein.
Bond Register means the registrationbooks maintainedby the Bond Registrar forthepurposeofidentifying
ownership of the Bonds.
Bond Registrar means thefiscal agencyoftheState ofWashington inNewYork,NewYork,forthe purposesofregisteringandauthenticatingtheBonds,maintainingtheBond Register,effecting thetransferofownership
of the Bonds and paying interest on and principal of the Bonds,
Bonds or Bond means allor a portion oftheCityof Moses Lake,Washington,LimitedTaxGeneralObligationRefundingBonds,2003,issued pursuant tothisordinance.
Call Date means December30,2003.
Citymeans theCityofMoses Lake,a municipalcorporationdulyorganizedand existing under thelaws oftheStateofWashington.
Code means the federal Internal Revenue Code of 1986,as amended.Any reference toa provision of theCodeshallincludetheapplicableregulationsoftheDepartmentoftheTreasurypromulgatedorproposedwithrespecttosuchprovision.
Commission means theSecuritiesand Exchange Commission.
Council means the City Council oftheCity,thegeneral legislative body oftheCity,as thesame shallbe dulyandregularlyconstitutedfromtimetotime.
Delivery Date means thedate of original issuance and delivery oftheBonds totheUnderwriter.
DTC means The Depository Trust Company of New York,a limited purpose trustcompanyorganizedunderthelawsoftheStateofNewYork,a depository fortheBonds pursuant to Section3 hereof.
Finance Director means theduly qualified,appointedand acting Finance Director ofthe Cityor any otherofficerwhosucceedstothedutiesnowdelegatedtothatoffice.
Government Obligations has themeaninggivensuch termin Chapter 39.53 RCW,as the same may beamendedorrestatedfromtimetotime.
Insurer means,Ambac Assurance Corporation,a Wisconsin-domiciled stock insurance company,or anysuccessorthereto,as issuer ofthePolicy with respect totheBonds,
Ordinance No.2142Page2
Letter of Representations means the blanket issuer letter ofrepresentationsfrom theCityto DTC.
MSRB means the Municipal SecuritiesRulemaking Board or any successor to its functions.
1997 Bond Ordinance means Ordinance No.1758 of theCouncil.
1997 Bond means the CityofMoses Lake,Washington,LimitedTax General Obligation Bond,1997,issued
pursuant tothe 1997 Bond Ordinanceunder date ofMarch20,1997.
NRMSIR means a nationally recognized municipal securities information repository.
Private Person means any natural person engaged in a trade or business or any trust,estate,partnership,
association,companyor corporation.
Private Person Use means theuse ofproperty ina tradeor business bya Private Person ifsuch use isother
thanas a memberof the general public.Private Person Use includes ownershipoftheproperty by the Private
Person as well as other arrangements thattransferto the Private Person theactual or beneficial use ofthe
property (suchas a lease,managementor incentive payment contract or other special arrangement)in such
a manner as to set the Private Person apart from the general public.Use of propertyas a member of the
generalpublicincludes attendance bythePrivate Person atmunicipalmeetingsor business rental ofproperty
tothePrivate Person ona day-to-daybasis ifthe rentalpaidby such Private Person is thesame as the rental
paidby any Private Person who desires torent the properly.Use ofpropertyby nonprofit community groups,
or community recreational groups is not treated as Private Person Use if such use is incidental to the
governmentaluses of property,thepropertyis made available for such use byallsuch community groups on
an equal basis and such community groupsare charged only a de minimis fee to cover custodial expenses.
Refunding Account meansthe Refunding Account set up withinthe bond redemption fund forthe 1997 Bond
by Section 11 hereof.
Registered Owner means the person inwhose name a Bond is registeredon theBond Register.For so long
as theBonds are held in book-entry onlyform,DTC shall be deemed tobe the sole Registered Owner.
Rule means the Commission's Rule 15c2-12 undertheSecurities and Exchange Act of 1934,as thesame
may be amended from timetotime.
SID means a state information depositoryfor theState ofWashington ifone is hereafter created.
Underwriter means Martin Nelson &Company,Inc.,Seattle,Washington.
In thisordinance,unless the context otherwise requires:
A.The terms "hereby,""hereof,""hereto,""herein,"hereunder"and any similarterms,as used inthis
ordinance,refer tothisordinance as a whole and notto anyparticular article,section,subdivision or
clause hereof,and theterm"hereafter"shallmean after,and theterm"heretofore"shall mean before,
the date of thisordinance,
B.Words ofthe masculine gender shallmeanand include correlative words of thefeminine and neuter
gendersand words importing thesingular number shall mean and include theplural number and vice
versa;
C.Words importing persons shall include firms,associations,partnerships (includinglimited
partnerships),trusts,corporations andother legal entities,including public bodies,as wellas natural
persons;
D.Any headings preceding thetextofthe several articles and Sectionsof thisordinance,and any table
ofcontents ormarginalnotes appended tocopies hereof,shall be solely for convenience ofreference
and shall not constitutea part ofthis ordinance,nor shall they affect its meaning,construction or
effect;and
E.All references herein to "articles,""sections"and other subdivisions or clauses are to the
correspondingarticles,sections,subdivisions or clauses hereof.OSection2.Purpose.Authorization andDescriotion of Bonds.Forthe purpose of refunding the1997 Bond and
therebyeffectingasavingstotheCityand paying a proportionate share ofthecosts ofissuance,theCityshall
issue its limitedtaxgeneral obligationrefunding bonds intheaggregate principal amount of $2,725,000(the
"Bonds").The Bonds shall be designated the "Cityof Moses Lake,Washington Limited Tax General
Obligation Refunding Bonds,2003,"shall be dated as ofthe Delivery Date,shall be fullyregisteredas to both
principal and interest,shall be in the denominationof $5,000 each or anyintegral multiple thereof,provided
thatno Bond shall represent more thanone maturity,shall be numbered separatelyinsuch manner and with
anyadditionaldesignationas theBond Registrardeems necessary for purposes of identification andcontrol,
and shall bear interest from theirdate orthemost recent date towhich interest has been paid ordulyprovided
OrdinanceNo.2142
Page 3
for,whichever is later,payable semiannually on the first days of March and September,commencingSeptember1,2004 tothematurity orearlierredemptionoftheBonds,at therates set forthbelow,and shallmatureonSeptemberiintheyearsandintheamountssetforthbelow,
MaturityYear Interest Rate(September 1)Principal Amount2004$90,000 1.20 %2005 105,000 1.552006105,000 1.902007105,000 2.252008110,000 2.552009110,000 2.852010115,000 3.102011120,000 3.452012125,000 3.65
2013 130,000 3.75
2014 130,000 3.90
2015 140,000 .4.00
2016 145,000 4.00
2017 150,000 4.10
2018 156,000 4.20
2023 890,000 4.60
Section 3.Registration,Exchange and Pavment.
A.Bond Reqistrar/Bond Register.The City hereby specifies and adopts the system of registrationapprovedbytheWashingtonStateFinanceCommittee,whichutilizesthefiscalagencies oftheStateofWashingtoninNewYork,NewYork,as registrar,authenticating agent,payingagent and transferagent(collectively,the"Bond Registrar").The Bond Registrar shall keep,orcause tobe kept,at itsprincipalcorporatetrustoffice,sufficientFecords fortheregistrationand transferof theBonds (the"Bond Register"),which shall be open toinspection bytheCity.The Bond Registrar may be removedatanytimeattheoptionoftheFinanceDirectoruponpriornoticetotheBondRegistrar,DTC,eachNRMSIRandSID,ifany,and a successor Bond Registrar appointedby the Finance Director.NoresignationorremovaloftheBondRegistrarshallbeeffectiveuntilasuccessorshallhavebeenOappointedanduntilthesuccessorBondRegistrarshallhaveacceptedthedutiesoftheBondRegistrarhereunder.The Bond Registrar is authorized,On behalf of theCity,to authenticate anddeliverBondstransferredorexchangedinaccordancewiththeprovisionsofsuchBondsandthisordinanceandtocarryoutalloftheBondRegistrar's powersand duties under thisordinance.TheBondRegistrarshallberesponsibleforitsrepresentationscontainedintheCertificateofAuthenticationontheBonds.
B.Registered Ownership.The Cityand theBondRegistrarmaydeem and treattheRegistered OwnerofeachBondastheabsoluteownerforallpurposes,and neither theCitynor theBond Registrar shallbeaffectedbyanynoticetothecontrary.Paymentof any such Bond shall be made onlyas describedinSection3(h)hereof,but such registration may be transferredas herein provided.All suchpaymentsmadeasdescribedinSection3(h)shallbe validand shall satisfy theliabilityof the City
uponsuch Bond totheextentof theamount or amounts so paid.
C.DTCAcceptance/Letter of Representations.The Bonds shall initiallybeheldinfullyimmobilizedform
by DTCactingas depository.To induce DTCtoaccept the Bonds as eligiblefordeposit at DTC,theCityhasheretoforexecutedanddeliveredtoDTCaBlanketissuerLetterofRepresentations(the"Letter ofRepresentations").
Neither theCity nor the Bond Registrar willhave any responsibilityor obligation toDTC participants
or thepersons forwhom theyact as nominees with respect tothe Bonds for the accuracyof anyrecordsmaintainedbyDTCoranyDTCparticipant,thepayment by DTC or anyDTC participant of
any amount inrespect of theprincipal of or interest on Bonds,any notice thatispermitted orrequiredtobegiventoRegisteredOwnersunderthisordinance(exceptsuch notices as shallbe requiredtobegivenbytheCitytotheBondRegistrarortoDTC),the selection by DTC orany DTC participantofanypersontoreceivepaymentintheeventofapartialredemptionoftheBonds,or any consentgivenorotheractiontakenbyDTCastheRegisteredOwner.For so long as anyBonds are held infullyimmobilizedformhereunder,DTCor its successor depository shall be deemed to be theRegisteredOwnerforallpurposes,and all references in this ordinance totheRegistered OwnersshallmeanDTCoritsnomineeandshallnotmeantheownersofanybeneficialinterestinanyBonds,
D.Use ofDepository.
1.The Bonds shallbe registered initiallyinthename of CEDE &Co.,as nominee of DTC,with
a single Bond for each maturity ina denomination equaltothe totalprincipal amount of suchmaturity.Registered ownership of such immobilized Bonds,oranyportions thereof,may notthereafterbetransferredexcept(A)to any successor of DTC or its nominee,provided that
Ordinance No.2142
Page 4
any such successor shall be qualifiedunder any applicable laws to provide the service
proposed tobeprovidedbyit;(B)toany substitutedepository appointedbytheCitypursuant
tosubsection (ii)belowor such substitutedepository's successor;or (C)to any person asprovidedinsubsection(iv)below.
2.Upon the resignationof DTCor its successor (orany substitute depository orits successor)
from its functionsas depository or a determination by the Cityto discontinue thesystem of
book entry transfersthroughDTC or its successor (or any substitute depository or its
successor),the City may appoint a substitutedepository.Any such substitutedepository
shall be qualifiedunder any applicable lawsto provide theservices proposedto be provided
by it
3.Inthecase of any transferpursuant to clause (A)or (B)ofsubsection (i)above,the Bond
Registrar shall,upon receipt of alloutstanding Bonds,togetherwith a written request onbehalfoftheCity,issue a singlenew Bond foreach maturitythen outstanding,registered in
thename ofsuch successor orsubstitutedepository,or its nominee,allas specifiedinsuch
written request of the City.
4.Intheeventthat(A)DTCor its successor (orsubstitutedepository or its successor)resigns
from its functions as depository,and nosubstitute depository can be obtained,or(B)theCity
determines that itis inthebest interest ofthe beneficial owners ofthe Bonds thatthe Bonds
be providedincertificated form,theownership of such Bonds maythen be transferredtoany
person orentity as herein provided,and shall no longer be held in fullyimmobilized form.
The City shall deliver a written request tothe Bond Registrar,together with a supply of
definitive Bonds incertificated form,to issue Bonds inany authorized denomination.Upon
receiptby theBond Registrar ofall thenoutstandingBonds,togetherwitha written request
on behalf of theCity to the Bond Registrar,new Bonds shall be issued in the appropriate
denominations and registered inthenames of such persons as are provided insuch written
request
E.Transferor ExchangeofRegistered Ownershio:Change inDenominations.The registeredownership
of any Bond may be transferredorexchanged,but no transferofanyBond shallbe valid unless it is
surrendered tothe Bond Registrar withthe assignmentform appearing on such Bond duly executed
bytheRegistered Owner orsuch Registered Owner's dulyauthorizedagent ina manner satisfactory
totheBond Registrar.Uponsuch surrender,theBond Registrar shallcancel thesurrendered Bond
and shallauthenticate and deliver,without charge tothe Registered Owneror transferee,a new Bond
(orBonds atthe option ofthe new Registered Owner)ofthesame date,maturity and interest rate and
for the same aggregate principalamount in anyauthorized denomination,naming as Registered
Owner the person or persons listed as the assignee on the assignment form appearing on the
surrendered Bond,in exchange for such surrendered and canceled Bond.Any Bond may be
surrendered tothe Bond Registrar and exchanged,without charge,for an equal aggregate principal
amountofBonds of the same date,maturity and interest rate,in any authorized denomination.The
Bond Registrar shallnotbe obligated totransferor exchange any Bond during a period beginning at
theopeningof business on the15th day ofthemonth nextpreceding any interest payment date and
ending at the close of business on such interest payment date,or,in the case of any proposed
redemption of the Bonds,after the mailing of notice of thecall ofsuch Bonds for redemption.
F,Bond Registrar's Ownership of Bonds.The Bond Registrar may become theRegistered Owner of
any Bond with the same rights it would have if it were not the Bond Registrar,and to theextent
permitted bylaw,may actas depository forandpermitany ofitsofficers or directors toactas member
of,or in any other capacitywith respect to,any committeeformed to protect the rights of the
Registered Ownersof the Bonds.
G.Registration Covenant The Citycovenants that,untilallBonds have been surrendered and canceled,
itwillmaintain a system for recording the ownership of each Bond thatcomplies withthe provisions
of Section 149 oftheCode.
H.Place and Medium of Pavment.Both principalofand interest on the Bonds shallbe payable inlawful
money ofthe United States ofAmerica.Interest on theBonds shall be calculatedonthebasis ofa
360-day year and twelve30-day months.For so long as all Bondsare in fullyimmobilized form,
payments of principal and interest shall be made as provided in accordance with the operational
arrangements of DTCreferred to in the Letter of Representations.Inthe event thatthe Bonds are
no longer infullyimmobilized form,interest on theBonds shall be paidbycheck ordraft mailed tothe
Registered Owners at theaddresses for such Registered Owners appearing ontheBond Register
on the 15th day of themonth preceding the interest payment date,and principal of the Bonds shall
be payable upon presentation and surrenderofsuch Bonds bythe Registered Owners at theprincipal
officeof the Bond Registrar;provided,however,that if so requested in writing by.the Registered
Ownerof at least $1,000,000principalamountof Bonds,interest willbe paid by wire transfer onthe
date due toan account with a bank located within theUnited States.
Ordinance No.2142
Page 5
Section4.Redemption and Purchase of Bonds.
A.Optional Redemotion.The Bondsmaturingintheyears prior to,and including,September 1,2013,
are not subject to redemption priortomaturity.The Bonds maturingon or afterSeptember 1,2014
are subject to redemption at the optionof the City in whole or in part on any date on or afterSeptember1,2013 (andifin part,withmaturitiesto be selected bythe City)at a priceof par plusaccruedinterest,ifany,tothedate of redemption.
B.Mandatory Redemotion.Unlesspreviously redeemed pursuanttotheforegoing optionalredemptionprovisions,theBonds maturingonSeptember 1,2023are subjectto mandatory redemption ata priceofparplusaccruedinteresttothedateofredemptiononSeptember1ofthefollowingyearsinthefollowingprincipalamounts:
Redemption Redemption
Years Amounts
2019 $160,0002020170,000
2021 180,000
2022 185,000
2023 195,000
*Final Maturity.
C.Purchase of Bonds.The Cityreserves therighttopurchase any of the Bonds offeredtoitatany timeatapricedeemedreasonablebytheCity.
D.Selection of Bonds for Redemotion.For as long as theBonds are held in book-entry only form,theselectionofparticularBondswithinamaturitytoberedeemedshallbemadeinaccordancewiththeoperationalarrangementsthenineffectatDTC.Ifthe Bonds are no longer held in uncertificatedform,theselectionof such Bonds to be redeemed and the surrender and reissuance thereof,asapplicable,shall be made as provided inthe following provisionsofthis subsection (d).IftheCityredeemsatanyonetimefewerthanalloftheBondshavingthesamematuritydate,theparticularBondsorportionsofBondsofsuchmaturitytoberedeemedshallbeselectedbylot(orin such
manner determined by the Bond Registrar)in increments of $5,000.Inthecase of a Bond of adenominationgreaterthan$5,000,the Cityand the Bond Registrar shall treat each Bond asOrepresentingsuchnumberofseparateBondseachofthedenominationof$5,000as is obtainedby
dividingtheactual principal amount of such Bond by $5,000.In theevent thatonlya portionof theprincipalsumofaBondisredeemed,upon surrender of such Bond at the principal officeoftheBond
Registrar thereshall be issued to the Registered Owner,without charge therefor,for the thenunredeemedbalanceoftheprincipalsumthereof,at theoption ofthe Registered Owner,a Bond orBondsoflikematurityandinterestrateinanyofthedenominationshereinauthorized.
E.Notice of Redemption.
1.OfficialNotice.For so longas theBonds are heldinuncertificatedform,noticeofredemptionshallbegiveninaccordancewiththeoperationalarrangementsofDTCasthenineffect,andneithertheCitynortheBondRegistrarwillprovideanynoticeofredemptiontoanyBeneficialOwners.Thereafter (ifthe Bonds are no longer held in uncertificatedform),notice ofredemptionshallbegiveninthemannerhereinafterprovided.Unless waivedbyanyownerofBondstoberedeemed,officialnoticeofanysuch redemption(whichredemptionshallbe
conditionedby theBond Registrar on thereceipt of sufficient funds forredemption)shall be
given by the Bond Registrar on behalf of theCityby mailing a copy of an officialredemptionnoticebyfirstclassmailatleast30daysandnotmorethan60dayspriortothedatefixed
forredemption totheRegistered Owner afthe Bondor Bonds tobe redeemedatthe addressshownontheRegisteroratsuchotheraddressasisfurnishedinwritingbysuchRegisteredOwnertotheBondRegistrar.Mailed notices will also be sent within thesame period toMoody's Investors Service,Standard&Poor's Ratings Group and totheUnderwriter ortheirbusinesssuccessors,ifany.
AIIofficial notices ofredemptionshall be dated and shall state:
(a)the redemption date,
(b)the redemptionprice,
(c)iffewer than alloutstandingBonds are tobe redeemed,the identification byseriesandmaturity(and,in the case of partial redemption,the respective principalamounts)of theBonds to be redeemed,(d)thaton the redemption date theredemption price willbecome due and payableuponeachsuchBondorportionthereofcalledforredemption,and thatinterest thereonshallceasetoaccruefromandaftersaiddate,and(e)the place where such Bonds are to be surrendered for paymentoftheredemptionprice,whichplaceof payment shall be theprincipal office of theBond Registrar.
Ordinance No.2142
Page 6
On or prior toany redemption date,the Cityshall deposit withthe Bond Registrar an amount
of money sufficient topay the redemption price of allthe Bonds or portions of Bonds which
are tobe redeemed on that date.
2.Effect ofNotice;Bonds Due.Officialnotice ofredemption having been given as aforesaid,
theBonds or portionsof Bonds so to be redeemed shall,on the redemption date,become
due and payable at the redemption price thereinspecified,and from and after such date
(unlesstheCityshalldefault inthepayment oftheredemptionprice)such Bonds orportions
of Bonds shall cease to bear interest.Upon surrender ofsuch Bonds for redemptionin
accordance with said notice,such Bonds shall be paid by the Bond Registrar at theredemptionprice.Installments of interest due on or priorto the redemption date shallbe
payable as herein provided for payment ofinterest AllBonds which have been redeemed
shallbe canceled and destroyed bytheBond Registrar andshall not be reissued.
3.Additional Notice.Inaddition totheforegoing notice,further notice shall be given bytheCity
as set out below,but no defect insaid further notice nor anyfailure to giveall or anyportion
of such further noticeshallin anymanner defeat theeffectiveness of a callfor redemption if
notice thereofis given as above prescribed.Each further notice of redemptiongiven
hereunder shall contain the information requiredabove for an official notice of redemption
plus(A)theCUSIPnumbers of allBonds beingredeemed;(B)thedate ofissue ofthe Bonds
as originally issued;(C)the rate of interest borne by each Bond being redeemed;(D)thematuritydateofeachBondbeingredeemed;and (E)any other descriptive information
needed to identifyaccurately theBonds being redeemed.Each further noticeofredemption
may be sent at least 35 days before the redemption date tothe MSRB,theinsurer,toeach
NRMSIR,the SID,if any,and to such persons (includingsecurities repositories who
customarily at thetimereceive notices of redemption in accordance with rules promulgated
bytheSEC)andwithsuch additional information as theCityshall deem appropriate,but such
mailings shall not be a condition precedent totheredemption of such Bonds.
4.Amendmentof Notice Provisions.Theforegoing notice provisions ofthisSection4,including
but not limited to the information to be included in redemption notices and the persons
designated toreceivenotices,may be amendedbyadditions,deletions andchanges inorder
tomaintain compliance withduly promulgated regulations and recommendations regarding
notices of redemption of municipalsecurities.
Section 5.Form of Bonds.The Bonds shall be in substantially thefollowingform:
STATEMENT OF INSURANCE
Financial Guaranty Insurance Policy No.(the"Policy")with respect to payments due
for principalofand interest on thisbondhas been issued by Ambac Assurance Corporation
("Ambac Assurance").The Policy has been delivered toThe Bank ofNewYork,New York,
New York,as theInsurance Trustee under said Policy and willbe held by such Insurance
Trustee or any successor insurance trustee.The Policyis on fileandavailablefor inspection
at theprincipaloffice oftheInsurance Trustee and a copy thereofmay be secured from
Ambac Assurance or the Insurance Trustee.AIIpayments required to be made underthePolicyshallbemadeinaccordancewiththeprovisionsthereof.The ownerofthis bond
acknowledges and consents tothesubrogationrights ofAmbacAssurance as more fullyset
forth inthePolicy.
UNITED STATES OF AMERICA
NO.$
STATE OF WASHINGTON
CITYOF MOSES LAKE
LIMITEDTAXGENERAL OBLIGATIONREFUNDINGBOND,2003
INTEREST RATE:CUSIP NO.:
MATURITYDATE:
REGISTERED OWNER:CEDE &Co.
PRINCIPAL AMOUNT:Dollars
THE CITY OF MOSESLAKE,WASHINGTON,a municipalcorporation of theState ofWashington
(the"City"),hereby acknowledges itself toowe and for value received promises to pay to theRegistered
Owner identifiedabove,or registered assigns,on the Maturity Date specified above the Principal Amount
specifiedabove and to pay interest thereon(computedon the basis of a 360-dayyear of twelve30-day
months)from December 30,2003,or the most recent date towhich interest has been paidor duly provided
OrdinanceNo.2142Page7
for,attheInterest RateSpecifiedabove,payable onSeptember1,2004,andsemiannuallythereafteroneachSeptember1andMarch1.Both principal ofand interest on this bond are payable in lawful money of theUnitedStatesofAmerica.For so long as the bonds of thisissue are infullyimmobilized form,payments ofprincipalandinterestthereonshallbemadeasprovidedinaccordancewiththeoperationalarrangementsofDTCreferredtointheBlanketIssuerLetterofRepresentationsfromtheCitytotheDepositoryTrustCompany.The Cityhas authorizedthefiscal agencyoftheState of Washington toact as registrar,payingagentandauthenticatingagent(the"Bond Registrar").Capitalizedtermsused in thisbondwhich are not
O specificallydefinedhave themeanings givensuch termsinOrdinance No.of theCity(the"BondOrdinance").
This bond is one of a series of bonds oflike date and tenor,except as to number,amount,rate ofinterestanddateofmaturity,inthe aggregate principalamount of $2,725,000and is issued torefund certainoutstandinggeneralobligationbondsoftheCity.
The bonds of this issue are issued under and in accordance withthe provisionsoftheConstitutionandapplicablestatutesoftheStateofWashingtonandapplicableordinancesdulyadoptedbytheCity.
The bondsofthisissue have been designated as "qualifiedtax-exemptobligations"for purposes ofSection265(b)oftheInternal Revenue Code of 1986,as amended.
The Cityhereby irrevocably covenants and agrees with the ownerofthisbondthatitwillinclude initsannualbudgetandlevytaxesannually,inan amount permitted tocitieswithoutavote,upon allthetaxablepropeityintheCity,inamountssufficient,togetherwithallother moneylegallyavailabletherefor,topay theprincipalofandinterestonthisbondasthesameshallbecomedue.The fullfaith,creditand resources oftheCityareherebyirrevocablypledgedfortheannuallevyandcollectionofsuchtaxesandtheprompt
payment ofsuch principaland interest.
The pledge oftax levies for repaymentofprincipalof and interest on the bonds ofthisissue undertheBondOrdinancemaybedischargedpriortothematurityorredemptionofthebondsofthisissuebymakingprovisionforthepaymentthereofonthetermsandconditionssetforthintheBondOrdinance.
The bonds ofthisissue are subject toredemption as stated inthe BondOrdinance.
This bond shallnotbe valid or become obligatory for any purpose or be entitled toany security orObenefitundertheBondOrdinanceuntiltheCertificateofAuthenticationhereonshallhavebeenmanually
signed by theBondRegistrar.
It is hereby certified that all acts,conditions and thingsrequiredby theConstitutionand statutes of
the State of Washington and ordinances ofthe Cityto exist,to have happened,and tohave been performed
precedentto and intheissuance ofthisbond do exist,have happened,and have been performedindue time,formand manner as prescribed by law,and that theamount of thisbond,togetherwithallotherobligations
or indebtedness of theCity,does not exceed anyconstitutionalor statutorylimitations of indebtedness.
INWITNESSWHEREOF,theCityhas caused thisbond tobe signed by themanualor facsimile
signatureof its Mayorand attested by themanual or facsimilesignature of its Finance Director,and the seal
of theCity tobe impressed or imprinted hereon,as of this30*dayof December,2003.
CITYOF MOSESLAKE,WASHINGTON
(SEAL)
Is/facsimile or manualsianatureMayor
Attest:
Is/facsimile or manualsignatureFinanceDirector
CERTIFICATE OF AUTHENTICATION
Date ofAuthentication:
This bond is one of the bonds described in thewithin mentioned Bond Ordinance and is one of theLimitedTaxGeneralObligationRefundingBonds,2003,of theCityofMoses Lake,Washington,dated as ofDecember30,2003.
WASHINGTON STATE FISCAL AGENCY,asBondRegistrar
By
Authorized Signatory
Ordinance No.2142
Page 8
Section 6.Execution of Bonds.The Bonds shall be executed on behalf of the City with the manual orfacsimilesignatureoftheMayoroftheCityandattestedbythemanualorfacsimilesignatureoftheFinance
Director,and the seal of theCityshall be impressed or imprinted on each ofthe Bonds.In case either or both
oftheofficers who shall have executedthe Bonds shall cease tobe an officerorofficersoftheCitybefore the
Bonds so signedshallhave been authenticated ordelivered bythe Bond Registrar,or issued by theCity,such
Bonds may nevertheless be authenticated,delivered and issued,and upon such authentication,delivery and
issuance,shallbe as binding upon theCityas thoughthosewho signedthesame had continued tobe such
officersof theCity.Any Bond also may be signed and attested on behalf of theCitybysuch persons as at
the actual date of execution ofsuch Bond shallbe theproperofficers of the City although at theoriginal date
of such Bond any such person shall not have been such officerofthe City.
Only such Bonds as shall bear thereon a Certificate of Authentication in the form hereinbeforerecited,
manually executed bytheBond Registrar,shallbe validorobligatory for any purposeor entitledtothebenefits
of this ordinance.Such Certificate of Authentication shall be conclusive evidence that the Bonds so
authenticated have been dulyexecuted,authenticatedand delivered hereunder and areentitledtothe benefits
of thisordinance.
Section 7.Mutilated,Lost,or Destroyed Bonds.IfanyBond shallbecome mutilated,theBond Registrar shall
authenticate and delivera newBond oflikeamount,date,interest rateandtenorinexchangeand substitution
fortheBond so mutilated,upon theRegistered Owner's payingtheexpenses and charges of theCityandthe
Bond Registrarinconnection therewithand upon surrender totheBond Registrar oftheBond so mutilated.
Every mutilated Bond so surrendered shallbe cancelledand destroyed by the Bond Registrar.
In case any Bond shall be lost,stolen or destroyed,the Bond Registrar mayauthenticate and deliver a newBondorBondsoflikeamount,date,and tenortothe Registered Owner thereofupon such Registered Owner's
paying theexpenses and charges of the Cityand theBond Registrar inconnection therewithand upon his or
her filingwith the Bond Registrar evidence satisfactory tothe Bond Registrar that such Bond or Bonds were
actually lost,stolen or destroyed and of his or her ownershipthereof,and upon furnishing the Cityand the
Bond Registrar with indemnity satisfactory to the Finance Director and the Bond Registrar.
Section 8.Bond Fund.There is hereby created in the office of theFinance Director a special fund to be
drawnupon for thepurpose ofpayingthe principalofand interest on theBonds to be known as the"Limited
Tax General Obligation Refunding Bond Redemption Fund,2003"(the"Bond Fund").The taxeshereafter
levied forthepurpose of paying principal ofand interest on theBonds and other funds tobe used topay the
Bonds shall be deposited inthe Bond Fund no later thanthedate such funds are required forthe payment of
principal ofand interest on the Bonds.Money in the Bond Fund not needed to pay theinterest or principal
next comingdue maytemporarilybe deposited insuch institutions or invested in such obligations as may be
lawfulfor the investment ofCityfunds.
Section 9.Pledge of Taxation and Credit The Cityhereby irrevocably covenants and agrees for as long as
any ofthe Bonds are outstanding and unpaid thateach year itwillinclude in its budget and levyan ad valorem
tax upon allthe property withintheCity subject totaxationin an amountthatwillbe sufficient,togetherwith
all other revenues and money of the City legally availablefor such purposes,to paythe principal of and
interest ontheBondsas thesame shall become due.AIIof such taxesso collectedand any other money to
be used for such purposes shall be paid intotheBond Fund.
The City hereby irrevocably pledges thattheannual tax provided for herein to be levied for the payment of
such principal and interest shall be withinand as a part ofthe taxlevy permitted tocities without a vote ofthe
people,and thata sufficient portion of each annual levyto be levied and collected by the City prior tothe full
payment of theprincipal ofand interest onthe Bonds willbe and is hereby irrevocably set aside,pledged and
appropriatedforthe payment oftheprincipal ofand interest on the Bonds.The fullfaith,credit and resources
ofthe Cityare hereby irrevocably pledged for the annual levy and collectionof said taxes and for the prompt
payment ofthe principal of and interest on the Bonds as the same shallbecome due.
Section 10.Defeasance,Intheevent that money and/or Government Obligations,maturingat such timeor
timesand bearing interest tobeearned thereoninamounts (togetherwithsuch money,ifnecessary)sufficient
to redeem and retire part or alloftheBonds inaccordance withtheirterms,are set aside ina special account
ofthe Citytoeffectsuch redemptionand retirement,andsuchmoneyand the principalof and intereston such
Government Obligations are irrevocably set aside and pledged for such purpose,then no further payments
need be made into theBond Fund for thepaymentof theprincipalof and interest on the Bonds so provided
for,and the registered owners of such Bonds shall cease to be entitled to any lien,benefit or securityofthis
ordinance except the righttoreceivethe moneyso set aside and pledged,and such Bonds shall be deemed
not tobe outstanding hereunder.Within 30 days of any defeasance of Bonds,the Bond Registrar shall
providenoticeofdefeasance of Bonds toregistered owners,theInsurer and to each NRMSIRand SID,ifany,
in accordance with Section 15 ofthis ordinance.
Section 11.Application of Bond Proceeds and Redemption ofthe 1997 Bond.
A.There is hereby authorizedtobe created intheCity's Fund 528 BuildingMaintenanceFund(Account
533 Building Maintenance Debt Service)an account known as the "Refunding Account"which
Account is tobe drawnupon forthe sole purpose of paying theprincipal ofand interest on the 1997
Bond untilits date ofredemptionandof paying costs related tothe refunding of the 1997 Bond.
Ordinance No.2142
Page 9
B.Theproceeds of thesale of the Bonds (exclusiveof(i)accrued interest thereon,ifany,whichshallbepaidintotheBondFundandusedtopayinterestontheBondsonSeptember1,2004 and (ii)aproportionateshareofthecostsofissuanceoftheBonds)shall be creditedtotheRefundingAccount.
C.Money in theRefunding Account shallbe used upon receipt thereoftodefease the 1997 Bond asauthorizedbythe1997BondOrdinanceandpaycostsofissuance.The Cityshall defease the 1997BondontheDeliveryDateanddischargesuchobligationsbytheuseofmoneyintheRefunding
O Accountto purchase certain Government Obligations,bearing such interest and maturing as toprincipalandinterestinsuchamouritsandatsuchtimeswhich,togetherwith any necessarybeginningcashbalance,willprovide for thepayment of:
1.Interestwhich willbecome due and payableon theCallDateon the 1997Bond;and
2.The redemptionprice(100%oftheprincipal amount thereof)on theCallDate,ofthe1997Bond.
Section 12.Tax Covenants:Special Designation.
A.NoArbitrage orPrivate ActivityBonds.The Cityhereby covenants thatitwillnot make any use oftheproceedsfromthesaleoftheBondsoranyotherfundsoftheCitythatmaybedeemedtobeproceedsofsuchBondspursuanttoSection148oftheCodethatwillcausetheBondstobe"arbitrage bonds"within the meaning of said Section.The Citywillcomply with the applicable
requirementsofSection148 oftheCode (orany successor provisionthereofapplicabletotheBonds)throughoutthetermof theBonds.
TheCityfurthercovenants thatitwillnot takeany action or permit any actiontobe takenthatwould
cause theBonds toconstitute "privateactivitybonds"under Section 141 of theCode.
B.Private Person Use Limitation for Bonds.The City covenants that for as long as the Bonds areoutstanding,itwillnot permit:
1.More than 10%oftheNet Proceeds oftheBonds tobe allocatedtoanyPrivate Person Use;and
O 2.More than10%of theprincipal or interest payments on the Bonds in a Bond Year to be
directly or indirectly:(A)secured by any interest in propertyused or to be used for anyPrivatePersonUseorsecuredbypaymentsinrespectofpropertyusedortobeusedforanyPrivatePersonUse,or (B)derivedfrom payments (whetheror not made to the City)in
respect ofproperty,or borrowed money,used or tobe used for any Private Person Use.
The Cityfurther covenants that,if:
3.More thanfive percent of theNet Proceeds oftheBonds are allocable toanyPrivate PersonUse;and
4.More than five percent oftheprincipalor interest payments on theBonds in a bond year are(underthe terms of thisordinance or any underlying arrangement)directly or indirectly:
(A)secured by any interest inpropertyused or to be used for any Private Person Use orsecuredbypaymentsinrespectofpropertyusedortobeusedforanyPrivatePersonUse,
or (B)derived from payments (whetheror notmade totheCity)in respect of property,orborrowedmoney,used or to be used for any PrivatePerson Use,then,(1)any Private
Person Use of the projects described in subsection (iii)hereof or Private Person Usepaymentsdescribedinsubsection(iv)hereof thatis inexcess of the five percent limitationsdescribedinsuchsubsections(iii)or(iv)willbe for a Private Person Use thatis related tothestateorlocalgovernmentaluseoftheprojectsfinancedorrefinancedwithBondproceeds,and (2)any Private Person Use willnotexceed the amount of Net Proceeds ofthe BondsusedforthestateorlocalgovernmentaluseportionoftheprojectstowhichthePrivatePersonUseofsuchportionofsuchprojectsrelates.The City further covenants that itwillcomplywithanylimitationsontheuseoftheprojectsbyotherthanstateandlocal
governmentalusers thatare necessary,intheopinionof its bond counsel,to preserve the
O taxexemption oftheinterest onthe Bonds.Thecovenantsofthissection are specified solely
toassure thecontinued exemption fromregular income taxationoftheintereston theBonds.
C.Special Designation.The City hereby designates the Bonds as "qualified tax-exemptobligations"under Section 265(b)of the Code.The City does not expect toissue more than $10,000,000 inqualifiedtax-exemptobligations during the calendar year 2003.
Section 13.Sale of Bonds.The City hereby accepts theoffer of Martin Nelson &Company,Inc.,Seattle,Washington,(the"Underwriter")topurchase theBonds onthetermsand conditionssetforth in its purchasecontractdatedasofthisdateandpresentedtotheCouncilonthisdate,and in thisordinance.The Mayor is
Ordinance No.2142
Page 10
hereby authorizedtoexecute such purchase contract on behalf of theCity.The proper City officials areherebyauthorizedanddirectedtodoeverythingnecessaryforthepromptissuance,executionand delivery
of the Bonds totheUnderwriter and for the proper use and application of theproceeds of such sale.
Section 14.Acoroval of Preliminary OfficialStatement:Final OfficialStatement.The City hereby approves
the Preliminary Official Statement presented herewith to the Council and authorizes the Undenuriter's
distribution of the Preliminary OfficialStatement in connectionwiththeoffering of the Bonds.Pursuant toSecuritiesandExchangeCommissionRule15c2-12 ("Rule 15c2-12"),theCity hereby deems the Preliminary
OfficialStatement as final as of its date except for theomission of information dependent uponthe pricing of
the issue and the completion of the underwriting agreement,such as offering prices,interest rates,selling
compensation,aggregate principalamount,principal amount per maturity,delivery dates,and othertermsof
the Bonds dependent on theforegoing matters.
The City agrees tocooperatewiththeUnderwriter todeliver or cause to be delivered,within seven business
days from thedate ofthesale ofthe Bonds and insufficienttimetoaccompanyany confirmation thatrequests
payment from any customer ofthe Underwriter for the Bonds,copies of a final officialstatement insufficient
quantity tocomply with paragraph (b)(4)of Rule 15c2-12 andtherulesoftheMunicipal Securities Rulemaking
Board.The City Manager is hereby authorized toreviewand approve on behalf oftheCitythe final official
statement relative tothe Bonds withsuch additionsand changes as may be deemed necessary or advisable
to him.
Section 15.Undertaking toProvide Ongoina Disclosure.
A.Contract/Undertaking.This section constitutestheCity's written undertaking for thebenefitof the
Registered Ownersand Beneficial Owners of the Bonds as required bySection (b)(5)of the Rule.
The City is an obligated person with respect to less than $10,000,000,of municipal securities,
including theBonds.
B.Financial Statements.The City agrees to provide or cause to be provided to each person uponrequestortotheSID,if any,a copy of its latest publicly available annual financial statements
prepared in accordance with the Budget Accounting and Reporting System prescribed by theWashingtonStateAuditorpursuanttoRCW43.09.200 (orany successor statute).Such annual
statements shallbe availableuponrequest tothe office of theFinance Director,thecurrent address
for whom is P.O.Box 1579,Moses Lake,WA 98837;telephonenumber:(509)766-9201.
C.MaterialEvents.The Cityagrees toprovideor cause tobe provided,ina timelymanner,tothe SID,
ifany,and toeach NRMSIR or totheMSRB notice of theoccurrenceof any of thefollowingevents
with respect tothe Bonds,ifmaterial:
1.Principal and interest paymentdelinquencies;
2.Non-payment related defaults;
3.Unscheduled draws on debt service reserves reflecting financial difficulties;
4.Unscheduled draws on credit enhancements reflecting financial difficulties;
5.Substitution of credit or liquidityproviders,or theirfailure to perform;
6.Adverse tax opinions or events affecting thetax-exemptstatus of the Bonds;
7.Modifications to the rightsof Bond owners;8.Bond calls (optional,contingentorunscheduled Bond calls other than scheduled sinking fund
redemptions forwhichnoticeis givenpursuantto Exchange Act Release 34-23856);
9.Defeasances;
10.Release,substitution or sale of property securing repayment oftheBonds;and
11.Rating changes.
Solely for purposes of disclosure,and not intending tomodifythisundertaking,the Cityadvises that
no debt servicereserves secures paymentof the Bonds.
D.Termination/Modification.The City's obligationstoprovide annual financial information and notices
ofmaterialevents shall terminateuponthelegal defeasance,prior redemption or payment in fullof
all oftheBonds.Anyprovision of thissection shallbe nulland void ifthe City(1)obtains an opinion
of nationallyrecognized bond counsel to theeffect thatthe portion of the Rule that requires that
provision is invalid,has been repealed retroactively or othenvisedoes not apply tothe Bonds and
(2)notifies eachNRMSIR and theSID,ifany,ofsuch opinion and the cancellationofthis section.OTheCitymayamendthissectionwithanopinionofnationallyrecognizedbondcounselinaccordance
withtheRule.Inthe eventofany amendmentof thissection,theCityshall describe such amendment
intheneXt annualreport,and shall include,a narrative explanation ofthereason for theamendment
and its impact on the type (orinthe case of a change ofaccounting principles,on the presentation)
offinancial information or operatingdata being presented bythe City.Inaddition,iftheamendment
relates tothe accountingprinciples tobe followed in preparingfinancial statements,(i)notice ofsuch
change shall be given inthe same manneras for a materialevent under Subsection (c),and (ii)the
annual report fortheyearinwhich thechange is madeshall present a comparison(innarrative form
and also,iffeasible,in quantitativeform)betweenthefinancialstatements as prepared on thebasis
ofthenew accountingprinciplesand thosepreparedonthebasis oftheformer accountingprinciples.
Ordinance No.2142
Page 11
E.Bond Owner's Remedies Under This Section.The rightof any bondowner or beneficial ownerofBondstoenforcetheprovisionsofthissectionshallbelimitedtoarighttoobtainspecificenforcementoftheCity's obligationsunder thissection,and anyfailure by theCitytocomplywiththe provisionsofthisundertakingshallnotbeaneventofdefaultwithrespecttotheBonds.For purposes of thissection,"beneficial owner"means any person who has the power,directly or indirectly,to vote orconsentwithrespectto,or todispose ofownershipof,anyBonds,including persons holding Bondsthroughnomineesordepositories.
Section 16.Bond Insurance.
A.Acceptance ofInsurance.Inaccordance withtheofferoftheUnderwritertopurchase theBonds,theCouncilherebyapprovesthecommitmentoftheInsurertoprovideabondinsurancepolicyguaranteeingthepaymentwhendueofprincipalofandinterestontheBonds(the"Bond InsurancePolicy").The Councilfurther authorizes and directs all proper officers,agents,attorneys andemployeesoftheCitytoexecuteacommitmentletterwiththeInsurerandtocooperatewiththeInsurerinpreparingsuchadditionalagreements,certificates,and other documentation on behalf oftheCityasshallbenecessaryoradvisableinprovidingfortheBondInsurancePolicy.
B.Payments Under the Bond Insurance Policy.As long as the Bond insurance Policy shall be in fullforceandeffect,theCityand theBond Registrar agree tocomplywiththefollowingprovisions:
1.If,at least one day prior to an interest payment date,the Cityor the Bond Registrar
determines that therewillbe insufficient funds in theBond Fund to paythe principal of orinterestontheBondsonsuchinterestpaymentdate,the Cityor the Bond Registrar shallsonotifytheInsurer.Such notice shall specify the amount of the anticipateddeficiency,theBondstowhichsuchdeficiencyisapplicableandwhethersuchBondswillbedeficientastoprincipalorinterest,or both.IftheCity or theBond Registrar has not so notified theInsureratleastonedaypriortoaninterestpaymentdate,theInsurer willmake payments ofprincipal
or interest due on the Bonds on or before thefirst business day nextfollowing thedate onwhichtheInsurershallhavereceivednoticeofnonpaymentfromtheCityortheBond
Registrar.
2.The Cityor the Bond Registrar shall,after givingnotice to the Insurer as provided inOsubsection(1)above,make availabletothe Insurer and,at the Insurer's direction,to TheBankofNewYork,as insurancetrusteefortheInsurer or any successor insurance trustee(the"Insurance Trustee"),theregistrationbooks oftheCitymaintained bythe Bond Registrar,and allrecords relatingto theBond Fund maintained under thisordinance.
3.The Cityorthe Bond Registrarshall provide theInsurer and theInsurance Trustee witha listofregisteredownersofBondsentitledtoreceiveprincipalorinterestpaymentsfromtheInsurerunderthetermsoftheBondInsurancePolicy,and shallmakearrangementswiththeInsuranceTrustee(i)to mailchecks or drafts tothe registered ownersofBonds entitledtoreceivefullorpartialinterestpaymentsfromtheInsurer,and (ii)to payprincipalon BondssurrenderedtotheInsuranceTrusteebytheregisteredownersofBondsentitledtoreceivefullorpartialprincipalpaymentsfromtheInsurer.
4.The CityortheBond Registrar shall,atthetimeitprovides notice tothe Insurer pursuanttosubsection(1)above,notify registered ownersof Bonds entitledto receive the paymentof
principal or interest thereonfrom theInsurer (i)as tothe fact of such entitlement,(ii)thattheInsurerwillremittothemallorapartoftheinterestpaymentsnextcomingdueuponproofofbondholderentitlementtointerestpaymentsanddeliverytotheInsuranceTrustee,informsatisfactorytotheinsuranceTrustee,ofan appropriate assignmentoftheregistered owner'srighttopayment,(iii)that should theybe entitledtoreceive fullpayment ofprincipalfrom theInsurer,theymust surrender theirBonds (alongwithan appropriate instrumentof assignmentsatisfactorytotheInsuranceTrusteetopermitownershipofsuchBondstoberegisteredinthenameoftheInsurer)for payment totheInsuranceTrustee,and not theBond Registrar,and (iv)that should theybe entitled to receive partial payment ofprincipal from the Insurer,theymust surrender theirBonds for paymentthereonfirst totheBond Registrar,who shallnoteonsuchBondstheportionoftheprincipalpaidbytheBondRegistrar,and then,alongwithanappropriateinstrumentofassignmentsatisfactorytotheInsuranceTrustee,totheInsuranceTrustee,whichwillthenpay the unpaid portion of principal.
5.Inthe event thattheBondRegistrar has noticethatany payment ofprincipal of or interest onaBondwhichhasbecomedueforpaymentandwhichismadetoabondholderbyoronbehalfoftheCityhasbeendeemedapreferentialtransferandtheretoforerecoveredfromitsregisteredownerpursuanttotheUnitedStatesBankruptcyCodebyatrusteeinbankruptcyinaccordancewiththefinal,nonappealable order of a courthaving competentjurisdiction,the Bond Registrar shall,at the time the Insurer is notified pursuant tosubsection(1)above,notifyallregistered ownersthatintheeventthatany registered owner'spaymentissorecovered,such registered ownerwillbe entitledtopayment fromtheInsurer
Ordinance No.2142
Page 12
to theextent of such recovery ifsufficient funds are not otherwise available,and the Bond
Registrar shall furnish tothe Insurer its records evidencing thepayments of principal of and
interest on the Bonds which have been made by the Bond Registrar and subsequently
recovered from registered owners and thedates onwhich such payments were made.
6.Inadditiontothoserights grantedthe Insurer under thisOrdinance,theInsurer shall,to the
extent itmakes paymentofprincipalofor interest on Bonds,become subrogatedtotherights
of the recipients of such payments in accordance with the terms of the Bond Insurance
Policy,and to evidencesuch subrogation(i)inthe case of subrogationas toclaims for past
due interest,theBond Registrarshall note theInsurer's rights as subrogeeontheregistration
books of theCity maintainedbytheBond Registrar upon receipt from theInsurer ofproof of
the payment of interest thereontothe registered owners of the Bonds,and (ii)in the case of
subrogationas toclaimsfor past due principal,the Bond Registrar shall note the Insurer's
rights as subrogee on theregistrationbooks of the Citymaintained by the Bond Registrar
upon surrender of the Bonds by theregistered ownersthereof togetherwith proofof the
payment of principal thereof.
7.While the Bond Insurance Policy is in effect,theCityshall furnish to the Insurer;
(a)as soon as practicableafter thefilingthereof,a copyofanyfinancialstatement and
a copyofany audit and annual report ofthe City at no cost tothe Insurer;
(b)a copyofany noticetobe givento the registered owners of the Bonds,including,
without limitation,notice of any redemptionof or defeasance of Bonds,and anycertificaterenderedpursuanttothisordinancerelatingtothesecurityfortheBonds
at no cost tothe Insurer;and
(c)such additional information it mayreasonablyrequest.
8.The City shall notify the Insurer of any failure of the City to provide relevant notices and
certificates.
9.The CitywillpermittheInsurerto discuss theaffairs,finances and accounts oftheCityoranyinformationtheInsurermayreasonablyrequestregardingthesecurityfortheBondswith
appropriate officers of the City.The Citywillpermit the Insurer to have access to and tomakecopiesofallbooksandrecordsrelatingtotheBondsatanyreasonabletime.
10.The Insurer shallhave theright todirect an accounting at theCity's expense,and theCity's
failure to comply with such direction within 30 days after receipt of written notice of the
direction from theInsurer shall be deemed a defaulthereunder;provided,however,that if
compliance cannotoccur within such period,then such period willbe extendedso long ascomplianceisbegunwithinsuchperiodanddiligentlypursued,but only if such extension
would not materially adverselyaffectthe interests of any registered owner of theBonds.
11.Notwithstanding any other provision of this ordinance,theCityshall immediately notifythe
Insurer ifatanytimethere are insufficient moneys to make anypayments ofprincipal and/or
interest as required and immediately upon theoccurrenceofanyeventof default hereunder.
C.Rights of Insurer.
1.Any provision ofthisordinance expressly recognizing or granting rights in or to theInsurer
maynotbe amended in any manner whichaffectsthe rights of the Insurer without the
prior written consentofthe Insurer.
2.Unless otherwiseprovided in thissection,theInsurer's consent shall be required in
addition tobondholder consent,when required,for thefollowingpurposes:(i)execution
and delivery of any amendment,supplement or change to or modification of this
ordinance;(ii)removal ofthe Bond Registrar and selection and appointment ofany
successor Bond Registrar other than a successor state fiscal agent;and (iii)any initiation
or approval ofany action not described in (i)or (ii)above whichrequires bondholder
consent O3.Any reorganization orliquidation planwithrespect tothe City must be acceptable tothe
Insurer.In theevent of any reorganizationorliquidation,the Insurer shallhave therightto
vote on behalf ofall Bond holders who hold Ambac Assurance-insured Bonds absent a
default by theInsurer under theBond Insurance Policy.
4.Anything in thisordinance tothecontrary notwithstanding,upon the occurrence and
continuance of an event ofdefault as defined herein,theInsurer shall be entitled to
controland directthe enforcement of allrights and remedies granted totheBond holders
orthe Bond Registrar for the benefit of the Bond holders.
Ordinance No.2142
Page 13
5.Notwithstanding anything herein tothe contrary,in theevent thattheprincipal and/orinterestdueontheBondsshallbepaidbytheInsurerpursuanttotheBondInsurancePolicy,the Bonds shall remain outstanding for all purposes,not be defeased or otherwisesatisfiedandnotbeconsideredpaidbytheCityandallcovenants,agreements and otherobligationsoftheCitytotheregisteredownersshallcontinuetoexistandshallruntothebenefitoftheInsurer,and the Insurer shallbe subrogated tothe rightsofsuch registered
owners.
6.To theextentthatthisordinanceconfers uponorgives or grantstotheInsureranyright,remedy or claim under or by reason ofthisordinance,theInsureris hereby explicitly
recognized as being a third-partybeneficiary hereunder and may enforce any such right,
remedy or claim conferred,given or granted hereunder.
Section 17.General Authorization;Prior Acts.The Mayor,the City Manager,and the Finance Director oftheCityandeachoftheotherappropriateofficers,agents and representatives of the Cityare each herebyauthorizedanddirectedtotakesuchsteps,todosuch otheracts and things,and toexecute such letters,certificates,agreements,papers,financing statements,assignments or instruments as in theirjudgment
may be necessary,appropriate or desirable tocarryout thetermsand provisions of,and complete thetransactionscontemplatedby,thisordinance.
Allacts takenpursuant to the authority of thisordinancebutpriorto its effective date are hereby ratified
and confirmed.
Section 18.Severabilitv.Ifany one or more of the covenants and agreements providedin thisordinancetobeperformedonthepartoftheCityshallbedeclaredbyanycourtofcompetentjurisdictiontobecontrarytolaw,thensuch covenant or covenants,agreement or agreements,shall be nulland void andshallbedeemedseparablefromtheremainingcovenantsandagreementsofthisordinanceandshallin
no way affect thevalidityoftheother provisions of thisordinance or of theBonds.
Section 19.Effective Date.The CityCouncildeclares thatan emergencyexists and thisordinance shall
takeeffectimmediately as providedby law upon one reading if2/3 of the entire CityCouncil present voteinfavorofpassage.
AdoptedbytheCityCounciland signedby its Mayor on December 9,2003.
MayorATTES
Finance Director
APPROVED ASTO FORM:
C Attorney '
O