HomeMy WebLinkAbout037 11
STATE OF WASHINGTON
COUNTY OF JEFFERSON
A RESOLUTION of the Board of County )
Commissioners of Jefferson County,Washington, )
relating to contracting indebtedness; providing )
for the issuance of $2,350,000 par value of )
Limited Tax General Obligation and Refunding )
Bonds, 2011 Series B, of the County for general )
County purposes to provide funds with which to )
pay the costs of (i) purchasing new software for )
its emergency communications 911 Dispatch )
Center, (ii) carrying out an advance refunding of )
all or a portion of the County's outstanding )
Limited Tax General Obligation Bonds, 2003, )
and (ill) issuing and selling the bonds; fixing the )
date, form, maturities, interest rates, terms and )
covenants of the bonds; establishing a bond )
redemption fund; providing for and authorizing the )
purchase of certain obligations out of the proceeds
of the sale of the bonds herein authorized and for
the use and application of the money derived from
those investments; authorizing the execution of an
agreement with The Bank of New York Mellon, of
New York, New Yark, as refunding trustee;
providing for the call, payment and redemption of
the outstlmding bonds to be refunded and
approving the sale and providing for the delivery
of the bonds to Martin Nelson & Co., Inc. of
Seattle, WlI~h;ngton.
RESOLUTION NO. "17_11
ADOPTED August 17, 2011
This document prepared by:
Foster Pepper PLLC
1111 Third Avenue, Suite 3400
Seattle, Washington 98101
(206) 447-4400
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Section 1 .
Section 2 .
Section 3 .
Section 4 .
Section 5 .
Section 6 .
Section 7 .
Section 8 .
Section 9 .
Section 10 .
Section 11 .
Section 12 .
Section 13 .
Section 14 .
Section 15 .
Section 16 .
Section 17 .
Section 18 .
Section 19 .
Section 20 .
Section 21 .
Section 22 .
TABLE OF CONTENTS*
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Definitions........... ............................. .................. ............ ...... ................................... 3
Authorization of Bonds............................................................................... ............ 6
Description of Bonds .............................................................................................. 6
Registration and Transfer of Bonds ........................................................................7
Payment of Bonds ................................................................................................... 9
Redemption Provisions and Open Market Purchase of Bonds ............................. 10
Failure To Redeem Bonds ....................................................................................10
Pledge of Taxes..................................................................................................... 10
Form and Execution of Bonds .............................................................................. 10
Bond Registrar ...................................................................................................... 12
Preservation of Tax Exemption for Interest on Bonds.......................................... 12
Designation of Bonds as "Qualified Tax-Exempt Obligations." .......................... 12
Refunding or Defeasance of Bonds ...................................................................... 13
Bond Fund and Deposit of Bond Proceeds ........................................................... 14
Refunding of the Refunded Bonds........................................................................ 15
Call for Redemption of the Refunded Bonds........................................................ 18
Findings with Respect to Refunding.. ................................................................... 18
Approval of Bond Purchase Contract ................................................................... 19
Official Statement ................................... ....................... ...... ....... .......................... 19
Undertaking to Provide Continuing Disclosure.................................................... 20
Severability .. ............ ...... ...... ........ ............................ ........... ................... ..... .......... 24
Effective Date .......................................................................................................24
*The cover page, table of contents and section captions of this resolution are for convenience of reference only, and
shall not be used to resolve any question of interpretation of this resolution.
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STATE OF WASHINGTON
COUNTY OF JEFFERSON
A RESOLUTION of the Board of County )
CommillSioners of Jefferson County, )
Washington, relating to contracting )
indebtedness; providing for the issuance of )
$2,350,000 par value of Limited Tax General )
Obligation and Refunding Bonds, 2011 )
Series B, of the County for general County )
purposes to provide funds with which to pay )
the costs of (i) purchasing new software for its )
emergency co=unications 911 Dispatch )
Center, (ii) carrying out an advance refunding )
of all or a portion of the County's outstanding )
Limited Tax General Obligation Bonds, 2003, )
and (ill) issuing and selling the bonds; fixing )
the date, form, maturities, interest rates. terms )
and covenants of the bonds; establishing a )
bond redemption fund; providing for and
authorizing the pmchase of certain obligations
out of the proceeds of the sale of the bonds
herein authorized and for the use and application
of the money derived from those investments;
authorizing the execution of an agreement with
The Bank. of New Yark Mellon, of New York,
New York, as refunding trustee; providing for
the call, payment and redemption of the
out~hmding bonds to be refunded and approving
the sale and providing for the delivery of the
bonds to Martin Nelson & Co., Inc. of Seattle,
Washington.
RESOLUTION NO. 31~\\
WHEREAS, Jefferson County, Washington (the "County"), is in need of purchasing new
software for its emergency co=unications 911 Dispatch Center (the "Project"), the estimAted
cost of which is $328,000, and the County does not have available sufficient funds to pay the
cost; and
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WHEREAS, under the laws governing the limitation of indebtedness, the County
currently may issue and it has need for the proceeds of$330,000 par value of limited tax general
obligation bonds authorized herein (the "Project Bonds"); and
WHEREAS, pursuant to Resolution No. 10-03 adopted by the Board of County
Commissioners (the "Board") on February 10, 2003 (the "Refunded Bond Resolution''), the
County issued its $4,580,000 par value Limited Tax General Obligation Bonds, 2003 (the "2003
Bonds"), for the purpose of paying for certain multi-purpose County improvements and certain
Courthouse improvements, and by the 2003 Bond Resolution reserved the right to redeem the
2003 Bonds maturing on or after December I, 2013, prior to their stated maturity dates on or
after December 1, 2012, at par plus accrued interest to the date fixed for redemption; and
WHEREAS, there are presently outstanding $2,010,000 par value of 2003 Bonds
maturing on December 1 in the years 2013 through 2015, inclusive, and 2018, and bearing
interest at various rates of 4.05% to 4.40% (the "Refunded Bonds''); and
WHEREAS, after due consideration, it appears to the Board that the Refunded Bonds
may be refunded by the issuance and sale of the limited tax general obligation refunding bonds
authorized herein (the "Refunding Bonds," and together with the "Project Bonds," the "Bonds'')
so that a substantial savings will be effected by the difference between the principal and interest
cost over the life of the Refunding Bonds and the principal and interest cost over the life of the
Refunded Bonds but for such refunding, which refunding will be effected by carrying out the
Refunding Plan (as hereinafter defined); and
WHEREAS, to effect that refunding in the manner that will be most advantageous to the
County it is found necessary and advisable that certain Acquired Obligations (hereinafter
defined) bearing interest and maturing at such time or times as necessary to accomplish the
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refunding as aforesaid be purchased out of a portion of the proceeds of the Refunding Bonds and
other money of the County; and.
WHEREAS, the Board deems it to be in the best interests of the County (i) to issue and
sell the Project Bonds to pay the costs of carrying out the Project and the costs of issuance and
sale of the Project Bonds and (ii) to issue and sell the Refunding Bonds to pay the costs of
carrying out the Refunding Plan and the costs of issuance and sale of the Refunding Bonds; and
WHEREAS, Martin Nelson & Co., Inc. has offered to purchase the Bonds under the
terms and conditions hereinafter set forth in the form of a bond purchase contract; NOW,
THEREFORE,
BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF
JEFFERSON COUNTY, WASHINGTON, as follows:
Section 1. Definitions. As used in this resolution, the following words shall have the
following meanings:
(a) "Acquired Obligations" means those United States Treasury Certificates of
Indebtedness, Notes, and Bonds-State and Local Government Series or other direct, noncallable
obligations of the United States of America purchased to accomplish the refunding of the
Refunded Bonds as authorized by this resolution.
(b) "Board" means the Board of County Commissioners of the County.
(c) "Bond Counsef' means a firm of lawyers nationally recognized and accepted as
bond counsel and so employed by the County for any purpose under this resolution applicable to
the use of that term.
(d) "Bond Funff' means the Limited Tax General Obligation Bond Fund, 2011,
created by Section 15 of this resolution for the payment of the Bonds.
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(e) "Bond Purchase Contract' means the offer dated the date hereo~ presented by
the Purchaser to purchase the Bonds.
(t) "Bond Reglstet" means the books or records maintained by the Bond Registrar
containing the name and mailing address of the owner of each Bond and the principal amount
and number of Bonds held by each owner.
(g) "Bond Registrar' means the Fiscal Agent.
(h) "Bonds" means the $2,350,000 par value Limited Tax General Obligation and
Refunding Bonds, 2011 Series B, of the County issued pursuant to and for the purposes provided
in this resolution.
(i) "Code" means the United States Internal Revenue Code of 1986, as amended. and
applicable rules and regulations proD1ulgated thereunder.
G) "County" means Jefferson County, Washington.
(k) "DTC'means The Depository Trust Company, New York, New York.
0) "Fiscal Agent' means the fiscal agent of the State of Washington, as the same
may be designated by the State from time to time.
(m) "Letter of Representations" means the Blanket Issuer Letter of Representations
dated November 2, 1998, between the County and DTC, as it may be amended from time to
time.
(n) "MSRB" means the Municipal Securities Rulemaking Board.
(0) "Project' means purchasing new software for the County's emergency
communications 911 Dispatch Center.
(P) "Project Bonds" means the Bonds issued for the purpose of paying the costs of
the Project and the sale and iss1lance of those Bonds.
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(q) "Project Funtl' means the County's JeffCom Capital Fund (119 000 010),
described under Section 15 of this resolution.
(r) "Purchaser' means Martin Nelson & Co., Inc., of Seattle, Washington.
(s) "Rating Agency" means any nationally recognized rating agency then
maintaining a rating on the Bonds at the request of the County.
(t) "Refunded Bonds" means the County's $2,010,000 outstanding 2003 Bonds,
maturing on December 1 in the years 2013 through 2015, inclusive, and 2018, the refunding of
which has been provided for by this resolution.
(u) "Refunded Bond Resolution" means Resolution No. 10-03 adopted by the Board
on February 10,2003, authorizing the sale and issuance of the 2003 Bonds.
(v) "Refunding Bonds" means the Bonds issued for the purpose of providing the
funds necessary to carry out the Refunding Plan and to pay for the costs of sale and issuance of
those Bonds.
(w) "Rule 15c2-12" means Rule 15c2-12 promulgated by the SEC under the
Securities Exchange Act of 1934, as amended.
(x) "Refunding Plan" means:
(i) The deposit with the Refunding Trustee of proceeds of the Refunding
Bonds (together with other money of the County, if necessary) in an
amount sufficient to acquire the Acquired Obligations and application of
that money to the acquisition of the Acquired Obligations by the
Refunding Trustee;
(ll) The receipt by the Refunding Trustee of the maturing principal of and
interest on the Acquired Obligations and the application of such amounts
(and any cash held by the Refunding Trustee) to:
(A) The payment of the interest on the Refunded Bonds when
due up to and including December 1,2012;
(8) The call, payment, and redemption on December 1, 2012,
of all of the Refunded Bonds at a price of par; and
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(ill) The payment of the costs of carrying out the foregoing elements of the
Refunding Plan.
"Refunding Trust Agreemenf' means a Refunding Trust Agreement between the
County and the Refunding Trustee substantially in the form of that which is on file with the
Treasurer and by this reference incorporated herein.
"Refunding Trustee" means The Bank of New York Mellon, of New York, New
York, serving as trustee or escrow agent or any successor trustee or escrow agent.
(y) "SEe' means the United States Securities and Exchange Commission.
(z) "State" means the State of Washington.
(aa) "Term Bonds" means Bonds payable prior to their stated maturity through
mandatory sinking fund redemption.
(bb) "Treasurer" means the Treasurer of the County.
(cc) "2003 Bonds" means the County's $4,580,000 par value Limited Tax General
Obligation Bonds, 2003.
Section 2.
Authorization of Bonds. The County shall borrow money on the credit of
the County and issue negotiable limited tax general obligation bonds evidencing that
indebtedness in the amount of $2,350,000 for general County purposes to provide the funds
necessary to (i) pay for the Project; (ii) carry out the Refunding Plan; and (ill) pay the costs of
issuance and sale of the bonds. The general indebtedness to be incurred shall be within the limit
of up to 1-1/2% of the value of the taxable property within the County permitted for general
municipal purposes without a vote of the qualified voters therein.
Section 3.
Description of Bonds. The bonds shall be called Limited Tax General
Obligation and Refunding Bonds, 2011 Series B, of the County, shall be in the aggregate
principal amount of $2,350,000 and shall be dated their date of initial delivery. The Bonds shall
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51153352.2.
be in the denomination of $5,000 or any integral multiple thereof within a single maturity and
shall be numbered separately in the manner and with any additional designation as the Bond
Registrar deems necessary for purposes of identification. Interest, computed on the basis of a
360-day year of twelve 30-day months, shall be payable semiannually on each June 1 and
December 1, co=encing December 1, 2011, to the maturity or earlier redemption of the Bonds.
The Bonds shall mature on December 1 in years and amounts and bear interest at the
rates per annum as follows:
Maturity
Years
2011
2012
2013
2014
2015
2016
2017
2018
Amounts
$15,000
55,000
365,000
370,000
365,000
380,000
390,000
410,000
Interest
Rates
0.60%
0.60
0.70
0.87
3.00
3.00
4.00
4.00
The life of the capital facilities to be financed with the proceeds of the Project Bonds
exceeds the term of the Project Bonds. The Bonds are designated as Project Bonds or Refimding
Bonds as set forth in the allocation table shown in Exhibit A, which is incorporated herein by this
reference.
Section 4.
Relrlstration and Transfer of Bonds. The Bonds shall be issued only in
registered form as to both principal and interest and shall be recorded on the Bond Register. The
Bond Register shall contain the name and mAiling address of the owner of each Bond and the
principal amount and number of each of the Bonds held by each owner.
Bonds surrendered to the Bond Registrar may be exchanged for Bonds in any authorized
denomination of an equal aggregate principal amount and of the same interest rate and maturity.
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Bonds may be transferred only if endorsed in the manner provided thereon and surrendered to
the Bond Registrar. Any exchange or transfer shall be without cost to the owner or transferee.
The Bond Registrar shall not be obligated to exchange or transfer any Bond during the 15 days
precedil1g any principal payment or redemption date.
The Bonds initially shall be registered in the name of Cede & Co., as the nominee of
DTC. The Bonds so registered shall be held in fully immobilized form by DTC as depository in
accordance with the Letter of Representations. Neither the County nor the Bond Registrar shall
have any responsibility or obligation to DTC participants or the persons for whom they act as
nominees with respect to the Bonds regarding accuracy of any records maintained by DTC or
DTC participants of any amount in respect of principal of or interest on the Bonds, or any notice
which is permitted or required to be given to registered owners hereunder (except such notice as
is required to be given by the Bond Registrar to DTC).
For as long as any Bonds are held in fully immobilized form, DTC, its nominee or its
successor depository shall be deemed to be the registered owner for all purposes hereunder and
all references to registered owners, bondowners, bondholders or the like shall mean DTC or its
nominee and, except for the purpose of the County's undertaking herein to provide continuing
disclosure, shall not mean the owners of any beneficial interests in the Bonds. Registered
ownership of such Bonds, or any portions thereof, may not thereafter be transferred except: (i) to
any successor of DTC or its nominee, if that successor shall be qualified under any applicable
laws to provide the services proposed to be provided by it; (ii) to any substitute depository
appointed by the County or such substitute depository's successor; or (iii) to any person if the
Bonds are no longer held in immobilized form.
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Upon the resignation of DTC or its successor (or any substitute depository or its
successor) from its functions as depository, or a determination by the County that it no longer
wishes to continue the system of book entry transfers through DTC or its successor (or any
substitute depository or its successor), the County may appoint a substitute depository. Any such
substitute depository shall be qualified under any applicable laws to provide the services
proposed to be provided by it
If (i) DTC or its successor (or substitute depository or its successor) resigns from its
functions as depository, and no substitute depository can be obtained, or (ii) the County
determines that the Bonds are to be in certificated form, the ownership of Bonds may be
transferred to any person as provided herein and the Bonds no longer shalI be held in fully
immobilized form.
Section 5. Payment of Bonds. Both principal of and interest on the Bonds shall be
payable in lawful money of the United States of America. Interest on the Bonds shall be paid by
checks or drafts mailed by the Bond Registrar on the interest payment date to the registered
owners at the addresses appearing on the Bond Register on the fifteenth day of the month
preceding the interest payment date or, if requested in writing by a registered owner of
$1,000,000 or more in principal amount of Bonds prior to the applicable record date, by wire
transfer on the interest payment date. Principal of the Bonds shall be payable upon presentation
and surrender of the Bonds by the registered owners to the Bond Registrar. Notwithstanding the
foregoing, for as long as the Bonds are registered in the name ofDTC or its nominee, payment of
principal of and interest on the Bonds shall be made in the manner set forth in the Letter of
Representations.
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Section 6. Redemption Provisions and Ooen Market Purchase of Bonds. The Bonds
shall be issued without the right or option of the County to redeem the Bonds prior to their stated
maturity dates.
The County reserves the right and option to purchase any or all of the Bonds in the open
market at any time at any price acceptable to the County plus accrued interest to the date of
purchase. All Bonds purchased under this section shall be canceled.
Section 7. Failure To Redeem Bonds. If any Bond is not redeemed when properly
presented at its maturity, the County shall be obligated to pay interest on that Bond at the same
rate provided in the Bond from and after its maturity until that Bond, both principal and interest,
is paid in full or until sufficient money for its payment in full is on deposit in the Bond Fund and
the Bond has been called for payment by giving notice of that call to the registered owner
thereof.
Section 8. Pledge of Taxes. For as long as any of the Bonds are outstanding, the
County irrevocably pledges to include in its budget and levy taxes annually within the
constitutional and statutory tax limitations provided by law without a vote of the electors of the
County on all of the taxable property within the County in an amount sufficient, together with
other money legally available and to be used therefor, to pay when due the principal of and
interest on the Bonds, and the full faith, credit and resources of the County are pledged
irrevocably for the annual levy and collection of those taxes and the prompt payment of that
principal and interest
Section 9. Form and Execution of Bonds. The Bonds shall be prepared in a form
consistent with the provisions of this resolution and State law and shall be signed by the
Chairman and Clerk of the Board, either or both of whose signatures may be manual or in
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facsimile, and the seal of the County or a facsimile reproduction thereof shall be impressed or
printed thereon.
Only Bonds bearing a Certificate of Authentication in the following form, manually
signed by the Bond Registrar, shall be valid or obligatory for any purpose or entitled to the
benefits of this resolution:
CERTIFICATE OF AUTHENTICATION
This Bond is one of the fully registered Jefferson County, Wa"hington,
Limited Tax General Obligation and Refunding Bonds, 2011 Series B, described
in the Bond Resolution.
W ASlDNGTON STATE FISCAL AGENT
Bond Registrar
By [Specimenl
Authorized Signer
The authorized signing of a Certificate of Authentication shall be conclusive. evidence that the
Bond so authenticated bas been duly executed, authenticated and delivered and is entitled to the
benefits of this resolution.
If any officer whose facsimile signature appears on the Bonds ceases to be an officer of
the County authorized to sign bonds before the Bonds bearing his or her facsimile signature are
authenticated or delivered by the Bond Registrar or issued by the County, those Bonds
nevertheless may be authenticated, issued and delivered and, when authenticated, issued and
delivered, shall be as binding on the County as though that person had continued to be an officer
of the County authorized to sign bonds. Any Bond also may be signed on behalf of the County
by any person who, on the actual date of signing of the Bond, is an officer of the County
authorized to sign bonds, although he or she did not hold the required office on the date of
issuance of the Bonds.
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Section 10. Bond Registrar. The Bond Registrar shall keep, or cause to be kept,
sufficient books for the registration and transfer of the Bonds, which shall be open to inspection
by the County at all times. The Bond Registrar is authorized, on behalf of the County, to
authenticate and deliver Bonds transferred or exchanged in accordance with the provisions of the
Bonds and this resolution, to serve as the County's paying agent for the Bonds and to carry out
all of the Bond Registrar's powers and duties under this resolution and County Resolution No.
47-91 establishing a system of registration for the County's bonds and obligations.
The Bond Registrar shall be responsible for its representations contained in the Bond
Registrar's Certificate of Authentication on the Bonds. The Bond Registrar may become the
owner of Bonds with the same rights it would have if it were not the Bond Registrar and, to the
extent permitted by law, may act as depository for and permit any of its officers or directors to
act as members of: or in any other capacity with respect to, any committee formed to protect the
rights of Bond owners.
Section 11. Preservation of Tax Exemption for Interest on Bonds. The County
covenants that it will take all actions necessary to prevent interest on the Bonds from being
included in gross income for federal income tax purposes, and it will neither take any action nor
make or permit any use of proceeds of the Bonds or other funds of the County treated as
proceeds of the Bonds at any time during the term of the Bonds which will cause interest on the
Bonds to be included in gross income for federal income tax purposes.
Section 12. Desilmation of Bonds as "Qualified Tax-Exempt Obligations." The
County has determined and certifies that (a) the Bonds are not "private activity bonds" within the
meaning of Section 141 of the Code; (b) the reasonably anticipated amount of tax-exempt
obligations (other than private activity bonds and other obligations not required to be included in
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such calculation) which the County and any entity subordinate to the County (including any
entity that the County controls, that derives its authority to issue tax-exempt obligations from the
County, or that issues tax-exempt obligations on behalf of the County) will issue during the
calendar year in which the Bonds are issued will not exceed $10,000,000; and (c) the amount of
tax-exempt obligations, including the Bonds, designated by the County as "qualified tax-exempt
obligations" for the purposes of Section 265(b)(3) of the Code during the calendar year in which
the Bonds are issued does not exceed $10,000,000. The County designates the Bonds as
"qualified tax-exempt obligations" for the purposes of Section 265(b )(3) of the Code.
Section 13. Refundinp' or Defeasance of Bonds. The County may issue refunding
bonds pursuant to the laws of the State or use money available from any other lawful source to
pay when due the principal of and interest on the Bonds, or any portion thereof included in a
refunding or defeasance plan, and to redeem and retire, refund or defease all such then-
outstanding Bonds (the "defeased Bonds") and to pay the costs of the refunding or defeasance.
If money and/or "government obligations" (as defined in chapter 39.53 RCW, as it may be
amended from time to time) maturing at a time or times and bearing interest in amounts (together
with money, if necessary) sufficient to redeem and retire, refund or defease the defeased Bonds
in accordance with their terms are set aside in a special trust fund or escrow account irrevocably
pledged to that redemption, retirement or defeasance of defeased Bonds (the "trust account"),
then all right and interest of the owners of the defeased Bonds in the covenants of this resolution
and in the funds and accounts obligated to the payment of the defeased Bonds shall cease and
become void. The owners of defeased Bonds shall have the right to receive payment of the
principal of and interest on the defeased Bonds from the trust account. The County shall include
in the refunding or defeasance plan such provisions as the County deems necessary for the
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random selection of any defeased Bonds that constitute less than all of a particular maturity of
the Bonds, for notice of the defeasance to be given to the owners of the defeased Bonds and to
such other persons as the County shall determine, and for any required replacement of Bond
certificates for defeased Bonds. The defeased Bonds shall be deemed no longer outstanding, and
the County may apply any money in any other fund or account established for the payment or
redemption of the defeased Bonds to any lawful purposes as it shall determine.
If the Bonds are registered in the name of DTC or its nominee, notice of any defeasance
of Bonds shall be given to DTC in the manner prescribed in the Letter of Representations.
Section 14. Bond Fund and Deposit of Bond Proceeds. There is created and
established in the office of the Treasurer a special fund designated as the Limited Tax General
Obligation Bond Fund, 2011 Series B (the "Bond Fund"), for the purpose of paying principal of
and interest on the Bonds. Accrued interest on the Bonds, if any, received from the sale and
delivery of the Bonds shall be paid into the Bond Fund. All taxes collected for and allocated to
the payment of the principal of and interest on the Bonds shall be deposited in the Bond Fund.
Proceeds of the Refunding Bonds in an amount sufficient to carry out the Refunding Plan
and pay the costs of issuance and sale of the Refunding Bonds, and proceeds of the Project
Bonds in an amount sufficient to pay the costs of issuance and sale of the Project Bonds, shall be
deposited with the Refunding Trustee and used to carry out the Refunding Plan and pay the costs
of issuance and sale of the Bonds, as set forth in Section 15 of this resolution. Any proceeds of
the Refunding Bonds not deposited with the Refunding Trustee shall be deposited in the Bond
Fund and used to pay interest on the Refunding Bonds on the first interest payment date.
There has been previously created and established in the office of the Treasurer a special
fund designated as the JeffCom Capital Fund (199 000 010) (the ''Project Fund"). The remaining
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principal proceeds and premium, if any, received from the sale and delivery of the Project Bonds
shall be paid into the Project Fund and used to pay the costs of the Project. Until needed to pay
the costs of the Project, the County may invest principal proceeds temporarily in any legal
investment, and the investment earnings may be retained in the Project Fund and be spent for the
purposes of those funds.
Section 15. Refundin.. of the Refunded Bonds.
(a) Anoointment of Refundinl! Trustee. The Bank of New York Mellon, of New
York, New York, is appointed Refunding Trustee.
(b) Use of Bond Proceeds: Acquisition of Acquired Oblil!ations. The proceeds of the
Refunding Bonds necessary to carry out the Refunding Plan shall be deposited immediately upon
the receipt thereof with the Refunding Trustee and used to discharge the obligations of the
County relating to the Refunded Bonds under the Refunded Bond Resolution by providing for
the payment of the amounts required to be paid by the Refunding Plan. To the extent
practicable, such obligations shall be discharged fully by the Refunding Trustee's simultaneous
purchase of the Acquired Obligations, bearing such interest and maturing as to principal and
interest in such amounts and at such times so as to provide, together with a beginning cash
balance, if necessary, for the payment of the amount required to be paid by the Refunding Plan.
The Acquired Obligations are listed and more particularly described in Exhibit A attached to the
Refunding Trust Agreement between the County and the Refunding Trustee, but are subject to
substitution as set forth below. Any Refunding Bond proceeds or other money deposited with
the Refunding Trustee not needed to purchase the Acquired Obligations and provide a beginning
cash balance, if any, and pay the costs of issuance of the Bonds shall be retorned to the County at
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the time of delivery of the Bonds to the initial purchaser thereof and deposited in the Bond Fund
to pay interest on the Refunding Bonds on the first interest payment date.
(c) Substitution of Acauired Oblilmtions. Prior to the purchase of any Acquired
Obligations by the Refunding Trustee, the County reserves the right to substitute other direct,
noncallable obligations of the United States of America ("Substitute Obligations") for any of the
Acquired Obligations and to use any savings created thereby for any lawful County purpose if,
(a) in the opinion of Bond Counsel, the interest on the Bonds and the Refunded Bonds will
remain excluded from gross income for federal income tax purposes under Sections 103, 148,
and 149(d) of the Code, and (b) such substitution will not impair the timely payment of the
amounts required to be paid by the Refunding Plan, as verified by a nationally recognized
independent certified public accounting firm.
After the purchase of the Acquired Obligations by the Refunding Trustee, the County
reserves the right to substitute therefor cash or Substitute Obligations subject to the conditions
that such money or securities held by the Refunding Trustee shall be sufficient to carry out the
Refunding Plan, that such substitution will not cause the Bonds or the Refunded Bonds to be
arbitrage bonds within the meaning of Section 148 of the Code and regulations thereunder in
effect on the date of such substitution and applicable to obligations issued on the issue dates of
the Bonds and the Refunded Bonds, as applicable, and that the County obtain, at its expense:
(1) a verification by a nationally recognized independent certified public accounting firm
acceptable to the Refunding Trustee confirming that the payments of principal of and interest on
the Substitute Obligations, if paid when due, and any other money held by the Refunding Trustee
will be sufficient to carry out the Refunding Plan; and (2) an opinion from Bond Counsel to the
effect that such substitution, under the statutes, rules, and regulations then in force and applicable
-16-
St1533S2.2
to the Bonds, will not cause the interest on the Bonds or the Refunded Bonds to be included in
gross income for federal income tax purposes and that such substitution is in compliance with the
statutes and regulations applicable to the Bonds. Any surplus money resulting from the sale,
transfer, other disposition, or redemption of the Acquired Obligations and the substitutions
therefor shall be released from the trust estate and transferred to the County to be used for any
lawful County purpose.
(d) Administration of Refunding Plan. The Refunding Trustee is authorized and
directed to purchase the Acquired Obligations (or Substitute Obligations) and to make the
payments required to be made by the Refunding Plan from the Acquired Obligations (or
Substitute Obligations) and money deposited with the Refunding Trustee pursuant to this
resolution. All Acquired Obligations (or Substitute Obligations) and the money deposited with
the Refunding Trustee and any income therefrom shall be held irrevocably, invested and applied
in accordance with the provisions of the Refunded Bond Resolution, this resolution, chapter
39.53 RCW and other applicable statutes of the State and the Refunding Trust Agreement All
necessary and proper fees, compensation, and expenses of the Refunding Trustee for the Bonds
and all other costs incidental to the setting up of the escrow to accomplish the refunding of the
Refunded Bonds and costs related to the issuance and delivery of the Bonds, including bond
printing, verification fees, Bond Counsel's fees, and other related expenses, shall be paid out of
the proceeds of the Bonds.
(e) Authorization for Refundinl1 Trust Agreement To carry out the Refunding Plan
provided for by this resolution, the Treasurer is authorized and directed to execute and deliver to
the Refunding Trustee a Refunding Trnst Agreement substantially in the form on file with the
Treasurer and by this reference made a part hereof setting forth the duties, obligations and
-17-
51153352.2
responsibilities of the Refunding Trustee in connection with the payment, redemption, and
retirement of the Refunded Bonds as provided herein and stating that the provisions for payment
of the fees, compensation, and expenses of such Refunding Trustee set forth therein are
satisfactory to it. Prior to executing the Refunding Trnst Agreement, the Treasurer is authorized
to make such changes therein that do not change the substance and purpose thereof or that assure
that the escrow provided therein and the Bonds are in compliance with the requirements of
federal law governing the exclusion of interest on the Bonds from gross income for federal
income tax purposes.
Section 16. Call for Redemption of the Refunded Bonds. The County calls for
redemption on December 1, 2012, all of the Refunded Bonds at par plus accrued interest. Such
call for redemption shall be irrevocable after the delivery of the Bonds to the initial purchaser
thereof. The date on which the Refunded Bonds are herein called for redemption is the first date
on which those bonds may be called.
The proper County officials are authorized and directed to give or cause to be given such
notices as required, at the times and in the manner required, pursuant to the Refunded Bond
Resolution in order to effect the redemption prior to their maturity of the Refunded Bonds.
Section 17. Findings with Resooct to Refunding. The Board finds and determines that
the issuance and sale of the Refunding Bonds at this time will effect a savings to the County and
is in the best interest of the County and its taxpayers and in the public interest. In making such
finding and determination, the Board has given consideration to the fixed matorities of the
Refunding Bonds and the Refunded Bonds, the costs of issuance of the Refunding Bonds and the
known earned income from the investment of the proceeds of the issuance and sale of the
Refunding Bonds pending payment and redemption of the Refunded Bonds.
-18-
51153352.2
The Board further finds and determines that the money to be deposited with the
Refunding Trustee for the Refunded Bonds in accordance with Section 16 of this resolution will
discharge and satisfy the obligations of the Refunded Bond Resolution with respect to the
Refunded Bonds, and the pledges, charges, trusts, covenants, and agreements of the County
therein made or provided for as to the Refunded Bonds, and that the Refunded Bonds shall no
longer be deemed to be outstanding under such resolution immediately upon the deposit of such
money with the Refunding Trustee.
Section 18. Approval of Bond Purchase Contract. The Purchaser has presented the
Bond Purchase Contract to the County offering to purchase the Bonds under the terms and
conditions provided in the Bond Purchase Contract, which written Bond Purchase Contract is on
file with the Clerk of the Board and is incorporated herein by this reference. The Board finds
that entering into the Bond Purchase Contract is in the County's best interest and therefore
accepts the offer contained therein and authorizes its execution by County officials. The Bonds
will be printed at County expense and will be delivered to the purchaser in accordance with the
Bond Purchase Contract, with the approving legal opinion of Bond Counsel regarding the Bonds.
The proper County officials are authorized and directed to do everything necessary for the
prompt delivery of the Bonds to the Purchaser and for the proper application and use of the
proceeds of the sale thereof.
Section 19. Official Statement. The County has been provided with copies of a
preliminAry official statement dated August 9,2011, prepared in connection with the sale of the
Bonds. For the sole purpose of the Underwriter's compliance with paragraph (b)(1) of Rule 15c2
12, the County deems "final" that preliminAry official statement as of its date, except for the
omission of information permitted to be omitted by Rule 15c2-12. The County authorizes,
-19-
511533'22
approves and ratifies the distribution by the Purchaser of that preliminA"Y official statement to
potential pmchasers of the Bonds.
The County authorizes and approves the preparation, execution by County officials and
delivery to the Purchaser of a :final official statement for the Bonds, in the form of the
preliminA"Y official statement, with such modifications and amendments thereto as shaI1 be
deemed necessary or desirable by the County. The County authorizes and approves the
distribution by the Purchaser of that :final official statement to potential pmchasers and
pmchasers of the Bonds.
Section 20. Undertakimz to Provide ContinuiDl1 Disclosure. To meet the requirements
of paragraph (bX5) of Rule 15c2-12, as applicable to a participating underwriter for the Bonds,
the County makes the following written undertaking (the "Undertakingj for the benefit of
holders of the Bonds:
(a) Undertakinll to Provide Annual Financial Information and Notice of
Specified Events. The County undertakes to provide or cause to be provided, either directly or
through a designAtM agent, to the MSRB, in an electronic format as prescribed by the MSRB,
accompanied by identifying information as prescribed by the MSRB:
(i) Annual financial information and operating data of the type included in
the :final official statement for the Bonds and described in subsection (b) of this section
("annual financial information'');
(ii) Timely notice of the occurrence of any of the following events with
respect to the Bonds, not in excess of ten business days after the occurrence of the event:
(1) principal and interest payment delinquencies; (2) non-payment related defaults, if
material; (3) unscheduled draws on debt service reserves reflecting financial difficulties;
-20-
51153351.2
(4) unscheduled draws on credit enhancements reflecting financial difficulties; (5)
substitution of credit or liquidity providers, or their failure to perform; (6) adverse tax
opinions, the issuance by the Internal Revenue Service of proposed or final
determinations of taxability, Notice of Proposed Issue (IRS Form 5701 - TEB) or other
material notices or determinations with respect to the tax statns of the Bonds; (7)
modifications to rights of holders of the Bonds, if material; (8) Bond calls (other than
scheduled mandatory redemptions of Term Bonds), if material, and tender offers; (9)
defeasances; (10) release, substitution, or sale of property securing repayment of the
Bonds; (11) rating changes; (12) bankruptcy, insolvency, receivership or similar event of
the County; (13) the consummation of a merger, consolidation, or acquisition involving
the County or the sale of all or substantially all of the assets of the County, other than in
the ordinary course of business, the entry into a definitive agreement to undertake such an
action or the termination of a definitive agreement relating to any such actions, other than
pursuant to its terms, if material; and (14) appointment of a successor or additional
trustee or the change of name of a trustee, if material; and
(ill) Timely notice of a failure by the County to provide required annual
financial information on or before the date specified in subsection (b) of this section.
(b) Tvoe of Annual Financial Information Undertaken to be Provided. The
annual financial information that the County undertakes to provide in subsection (a) of this
section:
(i) Shall consist of (1) annual financial statements prepared (except as noted
in the financial statements) in accordance with generally accepted accounting principles
applicable to Washington state local govermnental units, as such principles may be
-21-
51153352.2
changed from time to time, which statements shall not be audited, except, however, that if
and when audited financial statements are otherwise prepared and available to the County
they will be provided; (2) authorized, issued and outstanding balance of general
obligation bonds; (3) assessed valuation for the fiscal year; and (4) regular property tax
levy rate and regular property tax levy rate limit for the fiscal year;
(ii) Shall be provided not later than the last day of the ninth month after the
end of each fiscal year of the County (currently, a fiscal year ending December 31), as
such fiscal year may be changed as required or permitted by State law, co=encing with
the County's fiscal year ending December 31, 2012; and
(ill) May be provided in a single or multiple documents, and may be
incorporated by specific reference to documents available to the public on the Internet
website of the MSRB or filed with the SEC.
(c) Amendment of Undertaking, The Undertaking is subject to amendment
after the primary offering of the Bonds without the consent of any holder of any Bond, or of any
broker, dealer, municipal securities dealer, participating underwriter, rating agency or the MSRB,
under the circumstances and in the manner permitted by Rule 15c2-12.
The County will give notice to the MSRB of the substance (or provide a copy) of
any amendment to the Undertaking and a brief statement of the reasons for the amendment. If
the amendment changes the type of annual financial information to be provided, the annual
financial information containing the amended financial information will include a narrative
explanation of the effect of that change on the type of information to be provided.
-22-
51153352.2
(d) Beneficiaries. The Undertaking evidenced by this section shall inure to
the benefit of the County, the Purchaser and any holder of Bonds, and shall not inure to the
benefit of or create any rights in any other person.
(e) Termination of Undertakine:. The County's obligations under this
Undertaking shall terminate upon the legal defeasance of all of the Bonds. In addition, the
County's obligations under this Undertaking shall terminate if those provisions of Rule l5c2-l2
which require the County to comply with this Undertaking become legally inapplicable in
respect of the Bonds for any reason, as confirmed by an opinion of nationally recognized bond
counselor other counsel familiar with federal securities laws delivered to the County, and the
County provides timely notice of such termination to the MSRB.
(f) Remedv for Failure to Comolv with Undertakine:. As soon as practicable
after the County leams of any failure to comply with the Undertaking, the County will proceed
with due diligence to cause such noncompliance to be corrected. No failure by the County or
other obligated person to comply with the Undertaking shall constitute a default in respect of the
Bonds. The sole remedy of any holder of a Bond shall be to take such actions as that holder
deems necessary, including seeking an order of specific performance from an appropriate court,
to compel the County or other obligated person to comply with the Undertaking.
(g) DesiP"Turtion of Official Resoonsible to Administer Undertakine:. The
Treasurer (or such other officer of the County who may in the future perform the duties of that
office) or his or her designee is authorized and directed in his or her discretion to take such
further actions as may be necessary, appropriate or convenient to carry out the Undertaking of
the County in respect of the Bonds set forth in this section and in accordance with Rule l5c2-l2,
including, without limitation, the following actions:
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511533522
(i) Preparing and :filing the annual financial information undertaken to be
provided;
(ii) Determining whether any event specified in subsection (a) has occurred,
assessing its materiality with respect to the Bonds, and preparing and disseminating
notice of its occurrence;
(ill) Determining whether any person other than the County is an "obligated
person" within the meaning of Rule 15c2-12 with respect to the Bonds, and obtaining
from such person an undertaking to provide any annual financial information and notice
ofIisted events for that person in accordance with Rule 15c2-12;
(iv) Selecting, engaging and compensating desi8""ted agents and consultants,
including but not limited to financial advisors and legal counsel, to assist and advise the
County in carrying out the Undertaking; and
(v) Effecting any necessary amendment of the Undertaking.
Section 21. Severability. If anyone or more of the covenants or agreements provided
in this resolution to be performed on the part of the County shall be declared by any court of
competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or
agreements shall be null and void and shall be separable from the rem,,;n;ng covenants and
agreements in this resolution and shall in no way affect the validity of the other provisions of this
resolution or of the Bonds.
Section 22. Effective Date. This resolution shall become effective immediately upon
its adoption.
-24-
5U53352.2
ADOPTED by the Board of County Commissioners of Jefferson County, Washington, at
a special open public meeting thereof, this 17th day of August, 2011.
BOARD OF COUNTY COMMISSIONERS,
JEFFERSON COUNTY, WASHINGTON
~
'~s"-,2v / 4' ~ '
David W. S 'van, Commissioner
Phll~
ATTEST:
~vLdaOp:V~
T.__--'lr.l.d'-.. 8MC ~ ~ct
Clerk of the Board, ~
AJlPl:oved ~ to FO~ <6 J I S /20 'I
;z)~J ""-.__
David Alvarez ~ )
Deputy Prosecuting Attorney of Jefferson County
-25-
51153352.2
CERTIFICATION
I, the undersigned, Clerk of the Board of County Commk~ioners of Jefferson County,
WlI"hington (the "County''), hereby certify as follows:
1. The attached copy of Resolution No. ~ -1\ (the ''Resolution'') is a full, true and
correct copy of an Resolution duly passed at a special meeting of the Board of County
Commissioners (the "Board'') of the County held at the regular meeting place thereof on
August 17, 2011, as that Resolution appears on the minute book of the County; and the
Resolution is now in full force and effect;
2. Written notice specifying the time and place of the special meeting and noting the
business to be transacted was given to all members of the Board personally, by mail, by fax, or
by electronic mail at least 24 hours prior to the special meeting, a true and complete copy of
which notice is attached hereto as Appendix 1;
3. Written notice of the special meeting was given to each local radio or television
station and to each newspaper of general circulation that has on file with the County a written
request to be notified of special meetings, or to which such notice customarily is given; and
4. A quorum of the members of the Board was present throughout the meeting and a
majority of those members present voted in the proper manner for the adoption of the Resolution.
IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of August, 2011.
BOARD OF COUNTY COMMISSIONERS,
JEFFERSON COUNTY, WASHINGTON
r:2-OJ ~ (} Vld Gl UL
'g,tUf\C ~\ :
ClerkoftheBoard.l)~~
51153352..2
Exhibit A
Bond Allocation Schedule
$2,350,000 Limited Tax General Obligation and Refunding Bonds, 2011
Allocation of Priocinal Total
Year of Matnrltv Proiect Bonds Refnndinl! Bonds Prine/oal
2011 - $15,000 $15,000
2012 $40,000 15,000 55,000
2013 45,000 320,000 365,000
2014 45,000 325,000 370,000
2015 45,000 320,000 365,000
2016 45,000 335,000 380,000
2017 45,000 345,000 390,000
2018 50,000 360,000 410,000
TOTAL $315.000 $2,035 000 $2,350.000
-26-
'11533'1.2
CLOSING CERTIFICATE
I, JOHN AUSTIN, cert:ifY that I am the duly elected and acting Chairman of the Board of County
Commissioners of Jefferson County, Washington (the "County"), authorized to execute and deliver this
certificate, and further cert:ifY on behalf of the County as follows:
1. This certificate is delivered in counection with the issuance of the $2,350,000 par value
Limited Tax General Obligation and Refunding Bonds, 2011 Series B (the "Bonds"}, of the County.
2. To my knowledge and belief: after due review, the Official Statlmient dated August 17,
2011 (the "Official Statement"), relating to the Bonds, as ofits date and as of the date hereof: does not
contain any untrue statement ofa material fact or omit to state any material fact necessmy to make the
statements therein, in .the light of the circumstances under which they wereniade, not misleading in lll1Y
material respect, except that no representation is made with respect to infonnation relating to The Bank of
New York Mellon, the Depository Trust Company, its hook-entry system, or Martin Nelson & Co., Inc.
(the ''Underwriter").
3. There has been no material adverse change in the normal operations or financial
condition of the County since the date of the Official Statement
4. No litigation or other proceedings are pending or, to my knowledge, threatened, seeking
to restrain or enjoin the issuance and delivery of the Bonds or the levy and collection of taxes pledged to
pay the principal of and interest on the Bonds, or in any manner questioning the proceedings and anthority
under which the Bonds are issued or the validity of the Bonds thereunder; neither the corporate existence
or boundaries of the County nor the title of the present officers to their respective offices is being
contested; and no anthority or prooAP.tfing for the issuance of the Bonds has been repealed, revoked or
rescinded.
5. Resolution No. 37-11 of the County, the resolution anthorizing the issuance and sale of
the Bonds, has not been modified or repealed.
6. The execotion of this certificate shall constitute the execotion of the OfficialStatemeilt
by the County.
7. The representations of the County contained in the Con1nJct of Purchase for the Bonds
datedAugust 17,2011, between the County and the Underwriter were true and correct when mad,emld
are true and correct as of the date hereof.
DATED as of September 1,2011.
51163479.1
SIGNATURE IDENTIFICATION CERTIFICATE
STATE OF WASHlNGTON )
) $S.
COUNTY OF Jill'l'.hRSON )
1. LORNA DELANEY, CMC, certify that I, am the Clerk at" the Boiird afCouUty
Commill.'lianers .of Jefferson County, WaRhington (the "County"), and have been at lI11 tUnes
since January 23, 1989, and that JOHN AUSTIN is the Chairman afthe Board .of County
CommilNianets .of the County and has been at all tUnes since January 3,2011. ' '
I further certify that the $2,350,OOQparvalue Limited Tax General Obligatian and
RetTmding Bonds, 2011 SeriesB,ofthe County dated September 1, 201 i, bear my facsimile
'signature as Clerk .of the Board .of County Commi"",ianers .of the County and, the facsi1'nile
signature .of JOHN AUSTIN as Chairman .of the Boord .of County Commi"8ianers .of Caunty.
Jill'l".hRSON COUNTY, W ASHlNGTON
,~~CL'~'~
,,' Lorna Delaney, CMC,Clerkafthe Board of(J
County Commill,'lioners '
SUBSCRIBED AND SWORN TObefare me this Zq~y .of August, 2011. "
. . - ~
~N. CItGouRJE
,NOTARY PUBLIC
. STATeOFWASIlIHGTOH
~l:XPIRES
APRIL 29. 2013
~;~~:r..
(Lej!lblyPrint or StIunp Name ofNotaIy) . .
, , ,
Natary, P,ub, li,'C, ~,'andf1,arthe" State .of Washington,
" "residing at " M:I- r~ " .
, My appointment expires ",' ~
.,
.,
511~.I
RECEIPT FOR PAYMENT
.,
JEFFERSON COUNTY,WASInNGTON (the "County"),. aclm,owledges receipt. froni
Martin Nelson & Co., Inc. (the "Underwriter'~ this day of $331,572.95 in full payment for the
County's $2,350,000 par value Limited T~General Obligation and Re:lllniHng Bonds, 2011
Series B (the ~Bonds"); which settlementllli10unt was. computed lIIid disbursed as follows:
.' Pat value of Bonds
Less: Underwrlter's.Discount
$2;350,000.00
154,989.90
(16,450.00)
. i <Plus: Original Issue Premium
Amount wired by the Underwriter to The
Bank of New York Mellori;Refimding
Trustee, for the adVllttce refunding (lfthe
2003 Bonds and payment of certlI.incOSts
of issuance and sale of the Bonds.
(2,156,966.95) .
. $331,572.95
TOTAL AMOUNT WIRED TO COUNTY.'
DISBURsEMENT:
..,'
. Aniount deposited into Project Fund
328,000:00
Amount depol!ited into Bond Fund
3,572.95
.... TOTAL AMOUNT DISBURSED .
DA'fEl): Septembf:r I, 2tJ1l.
:, $331,57k95
JBFl:<'ERsON COUNTY, WASIiINGTON
.' '-Je ~.~
. JudiMorris, Treasur:et'
_!llS419.i .
.,
CERTIFICATE OF GENERAL OBLIGATION DEBT OUTSTANDING
1, rudi Morris, as the Treasurer of Jefferson County, Washington (the "County), hereby
cerfifythat the outstAnding general obligation debt of the' County, as of August 17,2011 is as
follows:
(1) Nonvoted Debt:
Thenonvoted debt of the County (including, but not 1itnited to, nonvoted general
obligation bonds and long-~ leases and other contracts) is $8,161,302.*
(2) Voted Debt:
The County has no outstanding voted debt
Except for the iSsuance of its $2,350,000 Limited Tax General Obligation and Refunding
Bonds, 2011 Series B (the~Bonds"). I further certify that the County has not incurred additional
nonvoted or voted debt since August 17, 2011.
DATED as ofSeptembei: 1, 2011.
. JEFFERSON COUNTY, WASHINGTON.
. , , ,I'
..- /.61 '-TY). . .~.
~c:.- " . ,-
Judi Morris, Treasurer .
. ..
· Excludes the County's~rling Limited Tax General ObliWlon Bonds, 2003, in the principal amoiint of .
S2,OlO;OOO maturing on Dec:ember 1 in the years 2013 to 2015, inclusive, and. 2018, to bereftmded withaportionof
the Proceeds of the ~ . . . .
5116'l419.1
,
TAX EXEMPTION AND NONARBlTRAGE CERTIFICATE
CONCERNING $2,350,000
LIMITED TAX GENERAL OBLIGATION AND REFUNDING BONDS, 2011 SERIES B
OF
JEFFERSON COUNTY, W ASHlNGTON
1, JOHN AUSTIN, on behalf of Jefferson County, Washington (the "County"), certify !Ill
follows:
1. General.
1.1 Resoonsible Officer. I am the Chairman of the Board of County Commissioners
of the County and, !Ill such, am an officer of the County responsible for issuing the County's
$2,350,000 par value Limited Tax General Obligation and Refunding Bonds, 2011 Series B (the
"Bonds"), dated, delivered and paid for on the same date !Ill the date of this certificate (the "issue
date").
1.2 Puroose of Certificate. This certificate is executed to establish the facts, estim..tl"$
and circumstances in existence on the issue date and the bona fide rellllonable expectations of the
County on the issue date !Ill to future events in connection with the Bonds for the purposes of the
applicable provisions of the Internal Revenue Code of 1986, !Ill amended (the "Code"), and
applicable Treasury Regulations under Sections 103, 141 and 148-150 of the Code.
1.3 ReIlllonable B!Illis for Exnectations. To the best of my knowledge, information
and belie~ this certificate accurately summarizes the facts, estimates and circumstances in
existence on the issue date, and the expectations of the County on the issue date about future
events in connection with the Bonds are rellllOnable~
1.4 Defined Terms. Capitalized words used. but not otherwise defined in this certificate
have the meaning set forth in Resolution No. 37-11 of the County (the "Bond Resolution").
2. Puroose ofIssuimr the Bonds.
2.1 Governmental PUroose. The County is a local government unit of the State of
Washington, and the Bonds are being issued for the purpose of providing the funds necessary to
(i) pay the costs of purchasing new software for the County's emergency co=unications 911
Dispatch Center (the "Project") (the ''New Money Portion"); (ii) pay the costs of advance .
refunding the County's $2,010,000 par value Limited Tax General Obligation Bonds, 2003,
maturing on December 1 in each of the years 2013 to 2015, inclusive, and 2018 (the ''Refunded
Bonds'') (the "Refunding"); and (ill) pay the costs of issuance and sale of the Bonds, all !Ill
further provided by the Bond Resolution. The Refunding will be effected by the Refunding Plan
which includes:
-1-
511634BO.1
(a) The deposit with the Refunding Trustee of proceeds of the Bonds in an amount
sufficient to acquire the Acquired Obligations and application of such deposit to
the acquisition of the Acquired Obligations by the Refunding Trustee (defined
below);
(b) The receipt by the RefundirigTrustee of the maturing principal of and interest on
the Acquired Obligations and the application of such amounts (and any cash held
by the Refunding Trustee) to the payment of interest on the Refunded Bonds
when due up to and including December I, 2912 and the call, payment, and
redemption on December I, 2012, of all of the Refunded Bonds at a price of par;
and
(c) The payment of the costs of carrying out the foregoing elements of the Refunding
Plan.
The proceeds of the Refunded Bonds (referred to as the "prior issue") were used to pay
the costs of making certain multi-purpose County improvements and certain Courthouse
improvements (the ''Refinanced Improvements").
It is expected that approximately $201,636.42 of the proceeds of New Money Portion of
the Bonds Will be used to reimburse the County for capital expenditores made for the Project .
prior to the issue date of the Bonds.
For .the purposes of certain federal regulations relating to use of proceeds of tax-exempt
obligations to reimburse prior expenditores (the "reimbursement regulations"), the County
hereby declares an official intent to reimburse itself from proceeds of the New Money Portion of
the Bonds for certain expenditores authorized to be made for the Project prior to the issue date of
the Bonds with certain County funds that were not, and were not reasonably expected to be,
reserved, allOcated on a long~term basffi. or otherwise set aside to pay the cost of the Project, as
more fully described below.
The original expenditures that will be repaid or reimbursed with proceeds of New Money
Portion the Bonds were made on or about July 18, 2011, a date not more than three yearS prior to
the issue date, and all were made either after ornot.more than 60 days before the date of this
declaration of official intent, except for (i) qualified "preHminmy expenditores". within the
meaning of the reimbursement regulations. (such. as expenditures for architectural, engineering,
surveying or soil testing services and similar items made before commencement of construction,
but not for costs of purchasing land, site preparation or other.costs incident to commencement of
construction) in an amount that does not exceed 20% of the expected cost of the P1:oject; and
(il) other expenditores for the Project in ail. aggregate total amount not exceeding the lesser of
$100,000 or 5% of the proceeds of the New Money Portion the Bonds. . .
The new software for the County's emergency communications 911 Dffi.patch Center was
first placed in service on or about July 18, 2011, and thus has not been placed in service for more
than 18 months. Therefore, the. reimbursement. allocations being made with proceeds of the
Bonds will occur not later than i 8 months 8fter the date the new software Was first placed in
service and not later than 3 years Rfter the date of the earliest original expenditure for the new
software, except for reimbursement for expenditures in an aggregate total amount not exceening
the lesser of$100,OOO or 5% of the proCeeds of the New Money Portion of the Bonds.
-2-
51t~1
2.2 No Iml'=issible Private Business Use. No more than 10% ($250,499) of the
proceeds of the Bonds (or of. a corresponding portion of the Project or the Refinanced
Improvements being financed with proceeds of the Bonds) will be used for any private business
use. No more than 5% ($125,250) of the proceeds of the Bonds (or of a corresponding portion of
the Project or Refinanced Improvements being financed with proceeds of the Bonds) will be used
either for any private business USe that is unreIati:d to the governmental purpose of the Bonds or
for any private business use that is related to a governmental purpose of the Bonds but exceeds
the amount of proceeds of the Bonds that are expected to be used for that governmental purpose.
No more than 5% of the proceeds of the Bonds will be used directly or indirectly to make or
finance loans to any person other than a governmental unit, except a loan. if any, which enables
the borrower to finance a governmental tax or assessment of general application for a specific
essential govermriental function, or that constitutes a nonpurpose investment within the meaning
of Section 148 of the Code.
3. Soarce and Disbursement of Proceeds.
3.1 Purchaser and Purchase Price of the Bonds. The Bonds will be sold to Martin
Nelson & Co., Inc. of Seattle, Washington (the "Purchaser"), at a price ofpar plus an original
issue premium of $154,989.90, less an underwriter's discount of$16,450.00, for a total purchase
price of$2,488,539.90.
3.2 Funds Into Which Proceeds From the Issuance and Sale of the Bonds Will Be
Deoosited. The County expects that the proceeds to be derived from the issuance and sale of the
Bonds will be deposited and used as follows:
(a) TheProiect $328,000.00 will be deposited in the County's Project Fund
and used to pay the costs of the Project
"
(b) The RefundinlZ. $2,156,966.95 will be deposited with The Bank of New
York Mellon of New York, New York, as refunding trustee (the "Refunding Trosteej and used
to cany out the Refunding and pay for the remaining costs of issuance of the. Bonds.
(c) Bond Fund. The remAining sale proceeds in the amount of$3,572.95 will
be deposited in the County's Bond Fund and used to. pay interest on. the' Bonds on their first
interest paYment date.
4. The Proiect.
. 4.1 Cost of the Proiect The.cost of the Project is est1mAtedto be approximately
$328,000, which cost will be paid from the proceeds of the issuance and.sale of the New Money .
Portion of the Bonds. The net amount received by the County as a result of the sale of the New
Money Portion of the Bonds, after payment of all expenses of isSuing, selling and delivering the
Bonds, is not expected to exceed the amount necessary to pay the costs of the Project
c,
4.2 Schedule of the Proiect. The County has made a down payment for the Project
and expects to pay the balal1ce of the Project by September 31, 2011. Therefore, .the County has
entered into ll. contract or otherwise incurred a substantial binding obligation toward .
-3-
51163480.1
4.4 No Sale of Proiect Exoected. The Project is not expected to be sold or otherwise
disposed of in whole or in part prior to maturity of the BOllds other than to dispose of any portion
. of the Project that beComes inadequate, obsolete, worn out, unfit or no longer necessary or useful
to the operaUonofthe Project..
5. The Refundinl!.
5.1 Use of Proceeds and Other Funds.
(a) The RefundinlL Of the sale proceeds of the Bonds deposited with the
Refunding Trustee, $2,136,067.00 will be used on the issue date to acquire United States
Trea.sury Certificates of Indebtedness, Notes and Bonds-State and Local Government Series
and $0.95 will be used to establish a cash balance, all of which will be held by the Refunding
Trustee in the refunding escrow established to carry out the Refunding.
. (b) Costs of Issuance. The remaining sale proceeds of the Bonds in the
amount of $20,899.00 deposited with the Refunding Trustee will be used to pay the costs of
issuing,. selling, and delivering the Bonds and the administrati,ve cost of carrying out the
Refunding. .
5.2 Pu.rpose and Effect of the Refundin...
(a) Interest Cost Savings. The purpose of the Refunding is to accomplish an
interest cost savings to the County of $124,928.29, with a net present value of $118,393.81, as
represented by the difference between the debt service on the Bonds and debt seCVice on the prior
issue discounted to the issue date using the yield on the BOIlQs as the discOunt rate, plus .
$2,660.16 of proceeds deposited in the Bond Fund. ... . .
(b) Permitted Advance Refunding. The isswmce of the Bonds repiesents only
the. first advance refunding of the prior to provide tax exempt new money financing for the
Refinanced Improvements. .
(c) Reauired RedemPtion of Prior Issue. The date on which the prior issue
will be called for redemptioll pursuant to the Refunding is the first date on which the prior issue
may be called for redemption.
-4-
51163480.1
. .
6. Pavment of Bonds.
6.1 Debt Service Structure. The Bonds are genem1 obligation bonds of the County
and are serial in form. Principal of the Bonds is payable annually at maturity on December 1 of
each year from 2011 to 2018, inclusive. Interest on the Bonds is payable semiannually on each
June 1 and December 1, comniencing on December 1, 2011. The Bonds are not subject to
redemption prior to their maturity date.
6.2 Source of Pavment. The Bonds are payable from the proceeds of taxlllllevied
against all of the taxallle property located within the County and other funds available therefor.
. Those funds that are expected to be used to pay principal of or interest on the Bonds will be .
deposited in the Bond Fund and used within 13 months of their deposit in that fundfot payment
of principal of or interest on the Bonds. The Bond Fund will be used primarily to. achieve .a
proper matching of tax revenues of1he County and debt service on the Bonds within each bond
year. It is expected that the Bond Fund will be depleted at least once a year (on each
December 1), except for a reasonable carryover amount not expected to exceed the greater of one.
year's earnings on that fund or 1/12 of the annual debt service on the Bonds. Investment
earnings from money on deposit in the Bond Fund are not expected to equal or exceed $100,000
in any bond year.
6.3 Absence of Other Sinking Funds. Except for the Bond Fund, the County bas not
created or. established and does not expect to .create orestablish any reserve fund, sinking fund or
other Ilimilllr fund that is reasonably expected to be used directly or indirectly to pay debt service
on the Bonds or any pledged fund with respect to which there is reasonable assurance that money
will be available in that fund to. pay debt service on the Bonds even if the County were to
encounter financial difficulties.
7. Restrictions on Investing Proceeds of the Bonds inIne:her Yielding Investments~
7.1 Calculation of Yield on Bonds. The yield .on the Bottds bas been calculated as the
yield that when used in computing the presentworth of all payments of principal of 8nd interest
on the Bonds, produces an amoUnt equal to the issue price of the Bonds. The "issue price" of the
Bonds is the initial offering price (mc1udiitg accrued interest anti original issi.lediscount or
premium, if any) at which a substantia1a.mount (at least. 10%) of each maturity ofiheBonds have
been sold to the public (notinch,lding bond houses, brokers or other intermediaries). Based on
the Certificate of Purchaser attached . hereto. as Exhibit A. the yield on the .Bonds has been
calcUlated to be 1.588622%. In determining this yield, no Jldjustments .were made for .
Purchaser's discount or other costs of issuance of the Bonds. .
7.2 Calculation of Yield on AcauiredOblie:ations.. The yield on the Acquired
Obligations has been calcUlated (using the same .methodand frequency intervals used in
calcu1atingthe yield on the Bonds) as that yield which when used in computing the present worth
of all payments of principal of and interest o.n the Acquired Obligations produces an amount
equal to the purchase price of the Acquired .Obligations. . The. purchase price of the Acquired
Obligations is thelr subscription price paid on the issue date to the Division of Special
Investments of the Uilited States Burean of Public Debt, which subscription price is. deemed to
-5-
'1163480.1
, .
be the fair market value of the Acquired Obligations pursuant to Treasury Regulations ~1.l48-
5(d)(6)(i). As so determined, the yield on the Acquired Obligations is 0.119103%, 1.469519%
less than the yield on the Bonds.
7.3 Restrictions on Investment of Proceeds in Higher Yielding Investments.
(a) Proiect Fund. The proceeds of the Bonds deposited in the Project Fund
may be invested in higher yielding investments for a temporary period not ex(:L"PAing three years
from the issue date of the Bonds.
(b) Proceeds in Refunding Escrow. The applicable temporary period for
investing proceeds of the Bonds held in the refunding escrow is 30 days after the issue date, but
the County elects to waive this temporary period, and those. proceeds (including investment
proceeds) will not be invested at a yield higher than the yield on the Bonds.
(c) Proceeds Used for Costs of Issuance. Proceeds of the Bonds to be used to
pay costs of issuance of the Bonds may be invested in higher yielding investments for a
temporary period of one year from the issue date.
(d) Bond Fund. Amounts treated as replacement proceeds of the Bonds
because they are held in the Bond Fund may be invested in higher yielding investments for a
temporary period not exceediug 13 months from the date of their deposit in the Bond Fund.
(e) Investment Earnings. InveStment proceeds of the Bonds for which no
other temporary ~od is available may beinvestoo in higher yielding investments for a
temporary period of one year from the date of receipt of those investment earnings.
(f). Restricted Yield Investments. Proceeds (and amounts treated as
replacement proceeds) of the Bonds that may not be invested in higher yielding inveStments will
be invested only in (i) obligations purchased at fair market value in bona fide, arm's length
transactions in an established market for those obligations and.,having yields not materially
higher than the yield on. the Bonds when calculated using the same frequency interval of
compolinc1ing interest as used for the Bonds, (ii) obligations the interest on which is excluded
. .
from gross income under Section 103 of the Code that are not private activity bonds under
Section 141 of the Code (or obligations treated as tax-exempt obligations under Section 103 of
the Code, e.g., obligations jssued by certain qwilified regulated investment C(lmpanies that
invest, to the extent .practicable, all of their assets in tax-exempt governmental bonds and meet
certain other conditions), and Demand Deposit Securities issued by the United States Treasury
pursuant to the State and Local Government Series program, or (ill) other United StateS Treasury
ObligatiottS--'State and Local Government. Series having yields not materially higher than the
yield on the Bonds.
8. Comnliance With Arbitrage Rebate Reauirement or Conditions for Ex.on From
Arbftral!:e Rebate Requirement.
8.1 General Arbitrage Rebate Comnliance. . The Bonds are subject to the rebate
requirement imposed by Section 148(t) of the Code, and therefore the County, in the manne, and.
-6-
jJ1634S0.1
.... ,-.
to the extent required by that Section, will calculate and rebate to the United States any
investment earnings on gross proceeds of the Bonds that are in excess of the amounts that would
have been earned if those gross proceeds had been invested at the yield on the Bonds, plus any
income attributable to such excess earnings. Investment earnings on amounts held in the Bond
Fund will not be taken into account for this purpose in any bond year in which those earnings do
not equal or exceed $100,000. . If the County for any reason fails to comply with the rebate
requirement to the extent applicable to the Bonds, the County, to the extent permitted and
required by Section 148(f)(7) of the Code, will pay any penalty that may be necessary to
preserve the tax exemption for interest on the Bonds.
9. Bonds Meet Other Arbitrage Reauirements.
9.1 No Other Governmental Oblil!ations Part of This Issue. There are no other
obligations of the County that are being sold at substantially the same time (less than l~ days
apart) as the Bonds pursuant to the same plan of financing and that are reasonably expected to be
paid from substantially the same somce of fimds. .
9.2 . No Reolacement of Funds InveSted in Higher Yielding Investments. No portion
of the proceeds of the Bonds will be used directly or indirectly to replace fimds of the County
invested in higher yielding investments.
9.3 No Abusive Arbitrage Deviee. The primary, bona fide governmental purposes of
issuing the Bonds are to finance the costs of the Project and the cost of carrying out the
Refimding. No action is being taken or will be taken in conneCtion with the issuance of the
Bonds that has the effect of (i) enabling the County to exploit the difference between tax-exempt
and taxable interest rates to obtain a material financial advantage by investing any portion of the
.grossproceeds of the Bonds over any period of time, ;md (rl) overbmdening the tax-exempt.bohd
market as a result of issuing more Bonds, issuing the Bonds earlier, or allowing the Bonds to
remain outstanding longer than is otherwise reasonably necessary to finance the Project and
carry.out the Refutiding.
"
9.4 No Intent To Earn Imnernrlssible Arbitrage Profit. The County will not take ;my
intentional action to earn ;my impermissible arbitrage profit from the investment of gross.
proceeds of the Bonds;
10. Bonds Meet Other Requirements for TilxExemotion.
10.1 Bonds In RelrlsteredForm. The Bonds are issued only in registered form.
.,
10.2 No Federal GUlIIlIlltV. Except as otherwi.se permitted by the Code, payment of the
principal of or interest on the Bonds is not guaranteed in whole or in part by the United states or
;my agency or instrumentality thereof. .
10.3 Information Retorn To Be Filed. The County will cause a Form 8038-G
Information Retorn respecting the Bonds to be timely filed with the Intemid Revenue Service~
.,
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5116J4:80.1
.!f ;j:._;: oj>,
. 10.4 Bonds Not HedtzeBonds. The County reasonably expects that (i) at lellSt 85% of
the spendable proceeds of the Bonds will be used to carry out the governmental purposes of the
Bonds within the 3-year periodbi:lginning on the issue date, and (ll) not more than 500h of the
proeeedsof the Bonds will be invested in nonpurpose. invesfments haying a substanth.illy
guaranteed yield for 4 years or more. To the ~t that proceeds of the Bonds Will be used for
refunding purposes, the expet:tations of the County with tespect to the use and inVestment of the
proceeds of the prior issue alsoIIlet theJ:equitements stated inclanses (i) and (n) oftb.e.prec'~;ng
sentence.
1l.BoIlds TaxExemm atJ.d Not Arbitrae:e Bonds.
. The County expects.thatboD.d CQunsel to .t)leCounty.w.i1lrely upon.the foregoingfucts,
estimates and circumstanceS in existence on the issue date and the reasonable expectations of the
County as. to future events respecting the Bonds taenable them to conclude that it is J;lot <;Apected
that proCeeds of the Bonds will be used in any maTl1'ler that would cause the Bonds to be arbitrage
bon4s. and to provide their opinion that the Bonds are governmental obligations the iritereston
which is eXcluded from gross income for federal income tax purposes under Section 103 of the
Code. . .
. DATED September i,2011.
JEFFERSON COUNTY, WASHINGTON
. '~163480.1
...-s;
.-,'
ustin; Chairman of the Boai'd of.
Com1JlllLq1Onei:s
.,
~
. .,
Information Return for Tax-Exempt Governmental Obligations
~ Under JntemaI Revenue Code seotIon 149(e)
~ See ..........ID_ns.
CeuUon: If the Issue price Is under $100.000. use Form 803B-GC.
If Amended Return. check here ~
2 ....... """'-1do.m.A., l'U1iEr (IlIt
91 6001322
4 Report number (Fer IRS Use Only)
B
.. 4-
Fcmn8038.G
(Rev. May 2010)
Department of the Treasury
---
Re rtIn Autito
1 Issuar's name
Jefferson Cou , Wahl n
.3 Number and street (or P.O. box W _Is notdellwtedlo street address)
1820 Jefferson street
s City. -." or post office. _ and ZIP code
Port Townsend, Wahl on 98368
7 NameoflsstJe
Umlled Tax General Obll on and Refundl Bonds, 2011 Series B
s Name and tilIe 01_ oIlhe Issuer or _ _ w!Icm the IRS _ caD lot more h4~".Ao1
Judl Monts, Cou Treasurer
of Issue enter the Issue r1~ Sse instructions and attach schedule
11 Educsllon . . .
12 HesIth and hospital . . .. . . .
13 T~rIatlon. . . . . . . . .
14 Publlcsafety . . . . . . . . .
16 environment (including sewage bonds).
16 Housing. . . . . . . . . . .
17 UtIlities........................
18 Other. DescrIbe ~ Advanced refunding of the County's 2003 L TGO Bonds
18 If obligations are TANs or RANs, check only box 19s . . . . . .
If obligations are BANs, check only box 19b . . . . . . . . . . .
20 If obligations are In the fonn of a lease or Installment sale, check box. . .
RoomISlllle
OMS N<>. 1545-0720
8 Dale 0I1sstJe
Se !amber 1, 2011
8 CUSIP number
473629DNO
10 TeIephonenumberof_orothor_
( 360 ) 385-9154
. ~.D
. ~D
. ~D
on of Obll atlons. Com lete for the entire ISSUe for which this form Is beln
lel SlaIed recIompIIon Id) Welghtad
ptlceal maturlIy average maturlIy
12/1/2018 $ 04,l19O $ 350 000 4.783
Uses of Proceeds of Bond Issue C1udln underwriters' disco
22 Pl ocesds used for accrued Interest. .. . . . . . . . . . .
23 Issue price of entire Issue (enter amount from line 21, column (b)) . .
24 Proceeds used for bond Issuance costs (including underwriters' discount) .
26 Proceeds used for credit enhancement . . . . . . . . . .
26 Proceeds allocated to ressonsbly requlrsd reserve or replacement fund .
27 Proceeds used to currently refund prior Issues. . . . . . . .
28 Proceeds used to advance refund prior Issues. . . . . . . .
29' Total (add lines 24 through 28) . . . . . . . . . . . . . .
30 Nonrefundl roceeds of the Issue subtract line 29 from line 23 and entar amount here
Des on of Refunded Bonds Com late this on for r8fundIn
31 EnI8r the remaining weIghted lMlrllQe maturity of the. bonds to be currently refundsd .
32 EnI8r the remaining weighted average maturity of the bonds to be advance ralunded .
33 EnI8r the last dsta on which the refurtded bonds will be called (MMIDD/YVYV). . ,
34 Enter the date(s) the refunded bonds were Issued ~ f1,lIdIOO/'(YY'
For PrIvacy Act and Paperwork ReducUonACl: Notice, see seperate InsIructlons. Oat. No. 03773S
(b)1sstJe price
24
26
26
27
28
37
o
o
o
2,136068
333,520
(0) I'IeId
1.5888 %
o
2,504,9llO
2,173,417
331,573
bonds.
.~
~
~
MiA
5.127
12/ll112012
03/03/2003
Form 8038-G [RoY. 6-2010)
years
years
~.-
,1-
PaId
Preparei"'
Use OnlY
Form 8038-G (Re'I. H01O) Page 2
Mlscellarleous
35 Enter the amount of the Slate volum8 cap allocated to the Issu8 under section 141(b)(5) . NfA
38e EnterthB amount of gross proceeds Invested or to be Invested In a guaranteed Jnvestrnent contract
(GIC) (seelnslrUcllons). . . . . . . . . . . . . . . . . . . . . . . . . N1A
b Enter the final matllrIty dale of the G1C ~
:rI Pooled fInanCIng$: a Proceeds of thls Issua that are to be used to make loans toOtl1er
goverrunanI8I uillts . . . . . . . ..... . . . . . . . ... . . . . . ..:rIa N1A
b If this Issue Is a loan made from the proceeds of another tax-exempt lssua.checI< box ~ 0 and entei the name of the
Issuer~ and the dale of the Issue ~
38 If the Issuer has designated the IssUe under section 2S5(b)(3)(B)(l)(lU) (1lrr18nIssu.er8XC8pt1on). check box .. . . ~ IiZI
39 If the Issuer has elected to pay a penally In Ueu of arblfrage Illbata, Qheck box .. . .. . . . .. . . . ~ 0
40 Ifthelssuarhas Identified a hedge, cpeck box. . . . . . . . ... . .. . .. . .. . ... ~ 0
~ penaitleo of perjury. I _Illatl_ _ this nitum and .......,.;.;yhl9 _ and _....oh., and 1ol!18 beolol rriy IuIowIedge
andbelJet.l!1eyIlt8ftu8,_andoompIel8.l__IllatI_lr1lholRS'sdl8Closllr801fi> _srstum .4...l8I!....._
loprocsssthlsrslum, Iolho_Illat'___
~. s;..~~..-.'7Z2.~ 0910:11 ~ ~~~~~c;:ntvTnl8Surer .
"-'- ~ DaIs Prspsre(s SSN '* PT1N
~. , . 09101/21111. ~ n P01061898
firm'" nama (<< ~ Foater Pe PLLC EIN 0606972
_n~~, 1111 ThIrd Avenue ste3400 SeattI WA09101 Phoneno. 206 4474400
Form 8038-G (Re'I. &-2010)
SIgnature
and
Co~nt
.~
.
REFUNDING TRUST AGREEMENT
TInS REFUNDING TRUST AGREEMENT (''Refunding Trust Agreement") is made
and entered into as of the 1st day of September, 2011, by and between JJ11'J:<hRSON COUNTY,
WASlDNGTON (the "County"), a public body corporate of the State of Washington, and THE
BANK. OF NEW YORK MELLON, a New York banking corporation (the "Refunding
Trustee").
WHEREAS, pursuant to Resolution No. 10-03, adopted by the Board of County
Commissioners (the "Board") on Febr1.1ary 10, 2003 (the "Refunded Bond Resolution''), the
County issued $4,580,000 of Limited Tax General Obligation Bonds, 2003 (the "2003 Bonds''),
and by the Refunded Bond Resolution reserved the right to redeem the 2003 Bonds maturing on .
or after December 1, 2013, prior to their stated matority dates at anytime on or after December
1, 2012, as a whole or in part (within one or more maturities selected by the County and
randomly within a maturity in such manner as the Bond Registrar (as such term is defined in the
Refunded Bond Resolution) shall determine), at par plus accrued interest to the date fixed for
redemption; and
WHEREAS, there is now outstanding $2,010,000 par value of the County's Limited Tax
General Obligation Bonds, 2003, maturing on December 1 of each of the years 2013 through
2015, inclusive, and 2018, and bearing interest at various rates ranging from 4.05% to 4.40% (the
''Refunded Bonds''); and
WHEREAS, pursuant to Resolution No. 37-11 of the County (the "Bond Resolution"),
the County has determined that the Refunded Bonds may be refunded out of the proceeds of the
sale of its Limited Tax General Obligation and Refunding Bonds, 2011 Series B (the "Bonds"),
for the purpose of realizing a debt service savings for the County;. arid
. WHEREAS, the paytnent, through the advance refunding of the Refunded Bonds, will be
accomplished pursuant to this Reftmrling Trust Agreement (including Exhibit A attached hereto)
and the Bond Resolution, which documents provide for and, for the purpose of Sections 103,
148" and 149(d) of the Internal Revenue Code of 1986, as aniended (the "Code''), are to be
considered as the Refunding Plan (as such term is defined in the Bond Resolution), by:
, (a) The delivery by the County to the Refunding Trustee of the
proceeds of the Bonds;'
(b) The purchase by the Refunding Trustee of the noncallable direct
obligations of the United States of America listed on Exhibit A attached hereto
and made a part hereof by this reference or substituted obligations purchased
plirsuautto Section' 20f this Refunding Trust Agi-eement (the "Acquited
ObligationS'') at or prior to the date the Bonds. are delivered to the original,
. purchaSer thereof and the County receives full payment therefor (the "Date of
Closing''), which Acquired Obligations satisfy the requirements of the
Verification described in paragraph (c);
-1-
51160740.1
;f
and,
(c) The delivery to the County and the Refunding Trustee of a
verification of escrow sufficiency prepared by a nationally recOgniZed
independent certified public accounting firm (the "Verification") verifying the
ml\fhemlltical accuracy of the computations (which computations shall be attached
to thaWerificatioll) shoWing that the Acquired Obligations to be purchased by the .
Refuriding Trustee pursuant to the Bond Resolution and this Refunding Trust
Agreement, together with the specified beginning cash balimce, if any, and the
maturing princ.ipal of and . interest on such Acquired Obligations, will provide
suflicient money (asSUming that all principal of and interest on the Acquired
Obligations are paid on the due dates thereof and assuming no reinveStment of
such maturing principal and interest) to pay interest on the Refunded Bonds when
due up to and including December 1, 2012, and to call, pay and redeem on
Decembed, 2012, all of the Refunded Bonds at a price of par;
(d) The receipt by the Refunding Trustee of the maturing installments
of principal of and interest on the Acquired Obligations; and
. (e) The Refunding Trustee's payment to the fiscal agent.of the State of
Washington (as the same may be designlltf'.lj from time to time) (the "Fiscal
Agent") of money sufficient to make the payments on the Refunded Bonds set
forth herein;
WHEREAS, upon the issuance and delivery of the Bonds and the irievocable deposit of
the proceeds of the BondS with the Refunding Trustee to carry out the Refunding Plan under the
authority of chapter. 39.53 RCW and other laws of the State of Washington (collectiyely, the
"Refunding Bond Act"), the. principal amount of the Refunded Bon<ls no lOnger shall be
considered outstanding pursuant to the defeasance provisions of the Refunded Bond Resolution;
and
'i'
WHEREAS, the Board has found that the refunding of the Refunded Bonds, through the
issuance of the Bonds, is beneficial and is necessary in order to achieve a debt service savings for
the County; and
WHEREAS, the Board, pursuant to the Bond ResOlution, has duly and validly authorized
the execution and delivery of this Refunding Trust.Agreement,the delivery of the proceeds of
the Bonds [and other money. of the County] to. the Refunding Trustee, the purchase by .the
Refunding Trustee of the Acquired Obligations and the carrying out of the Refunding Plan;
NOW, TfIER.EFORE, in consideration of the mutual covenants hereinafter contained and
for the benefit of the County, the parties hereto agree as follows: .
51160740.1
'.
-2-
~
Section 1. Deliverv of Money to Refunding Trustee. ' On the Date of Closing, the
County shall cause to be delivered to the Refunding Trustee $2,156,966.95 of the proceeds of the
BondS.
Section 2. ,Investment and, Exnenditure of Monev. On the Date of Closing, the
Refunding Trustee shall apply $2,136,067.00 to pay on behalf of the County the purchase and/or
subscription prices of the Acquired Obligations, from the source, in the principal amounts, with
the dates of maturity and bearing the interest rates or yields set forth in Exhibit A and $0.95 to
establish a beginning cash balance. Upon receipt of the Bond proceeds, the Refunding Trustee
shall deliver to the County copies of the documents evidencing the purchase of and payment for
the Acquired Obligations. Investments in mutual funds and unit investment trusts are prohibited.
On the Date of Closing, the Refunding Trustee shall appiy the remaining $20,899.00
towardS paying the costs of issuance and sale of the Bonds and the adminil<1rative costs of the
Refunding Plan, as set forth on the attached Exhibit B.
Section 3. SufficiencY of Acauired Oblie:ations. Based upon the Verification, the
County represents that the Acquired Obligations and the mirturing principal thereof and the
interest thereon, if paid when due, together with 1i!e beginning cash balance, shall be sufficient to
make when due the payments required by the Refunding Plan. Such. amounts coming due are
sometin:Ws referred to hereinafter as the "payments described in Section 3." The sehedtiles of the
sources, amounts, maturities, and interest rates or yields of the Acquired'Obligations and of the
Refunded BondS that will fulfill the foregoing requirements ate set forth intheVerificatiOD.;
,-;
Section 4. Collection of Proceeds of Acauired Oblie:ations and Application of Such
ProceedS and Money. The Refunding Trustee shall present for payment and shall collect and .
receive on the due dates thereof the maturing installments of the principal of and the interest on
the Acquired Obligations lind. any Substitute Obligations (defined hereinafter). The Refunding
Trustee shall _e payments, but only in the amounts received pursuant to this section, in a
timely manrierto the Fiscal Agent of the amounts to be paid on the Refunded Bonds as shown in
the Verification, Those payments shall be made by check, wire transfer, or such other method of
tranSfer of funds as shall be agreed upon by the Refi..mding Trustee .~dthe Fiscal Agent
, ,
, . . '
, , .
Section 5; , Notice of DefeasancelNotice of Redemntion. The.Refunding Trustee
agrees to give a notice of defeasance luid a notii:e of redemption of the Refunded BondS pursUant
to the timns of the Refunded BondS" and insubstantially the . foi'nls attached' hereto as and
described in Exhibits C and D, to the FiScal Agent for, distribUtion as described therein. The
nouceofdefeasance shall be given imtriediately follOwing the execution of this Refunding Trust
Agreement. and the notice of redemption shall be given in accordance with the Refunded Boild
ResolutjoD.; The, cost of giving the notices shall be paid by the eo~ty.
.', '
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51,lli074O.,1
described in Section 3. The County irrevocably conveys, transfers, and assigns to the Refunding
Trustee the Acquired Obligations, any SubstitQte. Obligations, the principal thereof .and the
inteiest thereon, and any .other money and investments deposited with the Refunding Trustee
pU1'S1iSIlt.to this Refunding Trust Agreement, for the purpose of making such payments. The
RefuIlding Trustee shall not sell, transfer, assign,. or hypothecate any Acquired Obligations,
. reinvestments, or Substitute Obligations except pursuant to Sections 8, 9, 13 and 15 hereof.
,- -' ,... '. ".: . .
Section 7. Reoorts and Notice of Insufficiencv. The Refunding Trustee shall submit a
teporttothe County, at least semiannually, which report shall set forth the cash. Acquired
OPligations,. and any Substitute Obligations held hereunder by the RefundingTrustee, the.
obligations which have matured and amounts received by the Refunding Trustee by reason of
such maturity, the interest earned on such oblig!lfions. a list of any investments or reinvestments
made by the Refunding Trustee in other obligations and the interest and/or principal derived
therefrom, the amounts paid to the Fiscal Agent, ll11d any other transaction of the Refunding
Trustee pertaining to its duties and obligations as set forth herein.
If the Refunding Trustee becomesawarethat the maturing principal of and interest on the
Acquired Obligations. any Substitute Obligations and other money held by the Refunding
Trustee pursuant to this Refunding Trust Agreement shall be insufficient to make the payments
described in Section 3, the. Refunding Trustee shall give the County prompt notice of such
~ciency or projected insufficiency. .
Section 8. Substitution of Different Oblilfcttions or Other Investments, The County
reserves the right to substitute from time to time for Acquired Obligations initially purchaSed in
accordance with Section 2 hereof, or for obligations purchased under this section, other
noncallable, nonprepayable direct obligations of the United States of Amencaandlor.obligations
~nditiona1ly.guaranteed by the United States of America.as to full. and timely payment.of .
principal and inter:est authorized to be acquired with the prOceeds of Bonds under the Refunding
Bond Act (the "Substitute Obligations''). Prior to. effecting any such sUbstitution, the County
~l have obta,jned.atits expense and delivered to the Refunding Trustee: .
. (a) A verification by a nationally recognized independent certified public accounting
firm cOnfirming that the maturing principal of and interest on the SubStitute Obligatio!1s and any
rem..ining Acquired Obligations to.beheld by the RefundingTrusteein therefunding escrow, if
paid when due and asSl:lttrlng no reinvestment thereof, together with any other cash thenheldby
the Refunding Trustee, will bes1.lfficieJit to carty out the Refimding Plan and make allrenl"inhtg
. payments described in Secti<>n 3; and
. (b) .. An opinion from F()~PepperPLLC,bondcounsel to the County; its successor
oiothernationally recpgnizedborid counsel to theCotinty (''BOrid Counsel''); that the diSposition
and substitution or purchase of such securities, under the statutes;'rules, and regulations theti in
force 1U1dapplicable tollie Bonds;.will not cause the .inteiest. on the Bonds or .theRefunded
Bonds to be included in gross income. forfedera1 income tax purposes and that SUch disposition
and subStitutionorpurohase is in CcimpJilmce 'with the statutes and regulations applic8ble to the
Bonds.. .
" -r
-4-
.511150740.1
I
I
I
If the verification delivered to the Refunding Trustee pursuant to Section 8(a) shows that
surplus morley not needed to make the payments described in Section 3 will result from the sale,
transfer, or other disposition of Acquired Obligations and the' Substitution of Substitute
Obligations therefor, that 'surplus money at the written request, of the County shaJl be released
from the trustesfate and shall be transferred to the County to be, Used for any lawful Coun,ty
pUrpoSe, subject to any restrictions stated in the opinion of BondCounsel required by Section
8(b).
, '
, ,
"section 9. Reinvestment of Proceeds of Acauired and/or Substitute Obligations. The
propeeds (Principal and interest) and reinvestment proceeds of any Acquired Obligations and/or
Substitute Obligations held by the Refunding Trustee in accordance with thiS Refunding Trust
Agreement, which are not needed within five business days of the receipt thereof to make the
payments described in Section 3, shall be reinvested by the Refunding Trustee, but only upon
receipt of written request of the County, on such date of receipt or the next business day. The
County shall direct such reinvestment subject to the following conditions: '
(a) Except as provided in subsection (c) below, the proceeds of such< Acquired
Obligations andlor Substitute Obligations shall be reinvested in other Substitute Obligations ata
yield that will not cause the composite yield on the refunding escrow to exceed 1.588622%
during its term or such higher yield as may'be directed by letter of instructions from the County
to the Refunding Trustee, but if the composite yield on the directed investments made ,pursuant
to thiS Refunding Trust Agreement would exceed 1.588622%, Such letter of instructions shall
eontain a verification of such composite yield and shall be based upon and accOmpaIiied by the
()pinion of Bond Counsel approving reinvestment of such proceeds at such higher yield;
(b) The obligations inwmch such proceeds are reinvested shall nlaturein an amount
at least equal to their purchase price on the date or dates directed by the County, but not later
than the date (as shown by the thenm~ recent certified public accountant verification) the
principal thereof is needed to make the payments described in Section 3; ,
(c) , If such proceeds, together with ,other fundS remaining in trust, are insufficient to
reinvest futhe, smallest denomination of such obligations or lire required to be used to make
payments described in Section 3 sooner, than the Shortest matUrity available for such obligations,
then thbseproCeeds and funds either shall be converted to Utrited States currency and retained or
shall remain, uninvested in the refunding escrow and carried on the books ()fthe Refunding
trilSteeuntil tequiredto make the payments descl10edin Section 3, of until sufficient money is
accumulated to permit the investment thereOf; , ,
'(d) ,,"Yield," as used in paragraph (a) of thiS section with respect to the Acquired"
ObligationS and Substitute Obligations;' means that yield . computed in accordance ,with and
pennitted by the Code applicable to the Bonds and the trust under this Refunding Trust
Agi-eement so as to preserve the exclQllion from gross income foffederal fucome tax purposes of
the interest on the Bonds; and
, '
(e) The Refunding Trustee; prior to making such reinvestment, shall receive: (i) a
verification by a nationally recognized independent certified public accountingfinn confirming
that after suCh reinvestment, the lIssets and funds held by the, Refuriding TruStee pursuant to this
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S1160/4O.1
i .
Refunding Trust Agreement will be sufficient to carry out the Refunding Plan and make all
remaining payments described in Section 3; and (il) an opinion from Bond Counsel that such
reinvestment will not cause the interest on the Refunded Bonds to be included in gross income
for federal income tax purposes.
The RefundingTrustee may make l;IJly and all investments permitted by the provisions of
this Section through its own investment department or the investment departments of any of its
affiliates.
Section 10. Amendments to Refunding Trust Al!reement The Refunding Trusteel;lJld
the County recognize that the owners of the Refunded Bonds and the Bondsfroin time to time
. have a beneficial interest in.the Acquired Obligations, the Sub~tute Obligations, l;IJld money to
be held by the Refunding Trustee as herein provided. Therefore, this Re:timdinB Trust
Agreement is irrevocablll and shall not be subject to amendment except for the purpose of
clarifying any ambiguity herein, increasing the protection of the rights of the owners of the
Refunded Bonds or the Bonds, or preserving the exclusion of the interest on the Refunded Bonds
and the Bonds from gross income for federal income tax purposes, and only if such amendment
is accompanied by an opinion addressed to. the County and the Refunding Trustee from Bond
Counsel fu the effect that such change is necessary for one of the above reasons and does not
detrimentally affect the owners of the outstanding Refunded Bonds and the Bonds or that it
strengthens the protection of the owners .of the Refunded Bonds l;IJld the Bonds l;IJld does not
detrimentally affect the owners of the Refunded Bonds l;IJld the Bonds. If such. amendment
affects the amount of money' and investments in the escrow account or the application thereof;
prior to the amendment's taking effect there also shall be a verification by a nationally
recognized independlmt certified public accounting firm satisfactory to the Refunding Trustee to
the effect that after such amendment the Acquired Obligations, Substitute Obligations,. and other
money in the escrow account will be sufficient to make the payments desCribed in Section 3.
A copy of such verification shall be delivered to the Refunding Trustee.
Section 11. Limitation of Liabilitv of Refunding Trustee. None of the provisions
contained in thiS Refunding Trust Agreement shall require the Refunding Trustee to use, risk or
adVl;IJlce its own funds in the performance of any of its duties or the exercise of any Qfits rights
or powers hereunder, The Refunding Trustee shall be under no liability for the paymentof
interest On any funds. or other property received by .it hereunder except to the extent the
Refunding Trustee is required by the express terms of this Refunding Trust Agreement to invest
such funds. . .
The Refunding Trustee undertakes to perform such duties and only SUCh duties as are
SpeCifically set forth in this Refunding Trust Agreement, and no implied covenl;lJltsor obligationS
shall be read' into this Refunding Trust Agreementaga:inst the Refunding Trustee; The
Refunding Trustee shall not be liable except for its negligence llr wi1lfu1miscOlldi1cthereuiuli:r.
. The Refunding Trustee may conClusively rely and shall be fully protected in acting or refraiDing
fromactlng upon any resolution. certificate, ~ment, instruti1ent, opinion. repon, notice,
request, consent, order, approval or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party ar parties. The RefundingTrustee maY
consult with oounsel and the advice' arany opinion of counsel sbal1befullaiidooniplete"
authoii2:atilln aild protectioniriresPect of any actilln taken or omittedbr it hereunder' in. good
-6-
"
51160740.1
faith and in acwrdance with such advice or opinion of counsel. The Refunding Trustee may
execute any of the tnIsts or powers hereunder or perform any duties hereunder either directly or
by or throughagent$,attorneys, custodians or nominees appointed with due care, and.shall not be
respoJlSlble for any willful misconduct or negligence on the part of any agent, attorney, custodian
or nominee so itppointed.
Anything in this Refunding Tmst Agreement to the contrary notwithstanding, in no event
shall the Refunding Trustee be liable for speciill, indirect,' punitive 01' consequential loss or
dAmllge of any kind whatsoever (including but notlimited to lost profits), even if the Refunding
Trustee has been advised of the likelihood of.such loss or c1llmllge and regardless of the form of
action.
The Refunding Trustee agrees to accept and act upon instructions or. directions pursuant
to this Refunding TmstAgreement sent by unsecured e-:mail, facsimile 1nmlUT1illllion or other
similar unsecured electronic methods, provided, however, that, the Refunding Trustee shall have
received an incumbency certificate listing persons designated to give such instructions or
directions and contllining specimen signatures of such . designated ~ns, which such
incumbencycerti:ficate shall be amended and replaced whenever a person is to be added or
deleted from the listing. If the County elects to give the Refunding Trustee e-:mail or facsimile
instructions (or instructions by a similar electronic method.) and the Refuuding Trustee in its
discretion elects to act upon such instructions, the Refunding Trustee's reasonable understanding
of such instructions shall be deemed controlIing. The Refunding Trustee shall not be liable for
any losses, costs or expenses arising directly or indirectly from the Refunding Trustee's reliance
upon and compliance with such instructions llotwithstanding such instructions wn:tlict or are
incOnsistent with a subsequent written instruction. The County agrees to lissume all risks arising
out of the use of such electronic methods to submit instructioIlsand directions to the Refunding
Trustee, including without limitation the risk of the Refunding Trustee acting on unauthorized
instructions, and the risk of interception and misuse by third parties.
The Refunding Trustee's liabilities and oblig8tlons in con:p.ection with this Refunding
'Ttnst Agreement are eonfined to those specificaIly described herein.. The Refunding Trustee is
authorized and' directed to comply with the provisions. of this RefundingTmst Agreement and is
relieved. from all liability for so doing notwithstanding lIl1Y demalld or notice to the contrary by .
any party hereto. . The Refunding Trustee shall not be responsible .or liable for the sufficiency,
correctness, genuinene8li, or validity of the Acquired Obligations or the Substitute Obligations
deposited with it;theperfonnance or compliance by any partY other than the Refunding Trustee
with the terms or conditions of any such instruments; or any loss which may occur by reason of
forgeries, faIse represelitations, Or the' eXercise of the Refunding Trustee's. discretion in' any
pa!tlculaJ: manner unleSS sUchexetcise is negligent or constitutes Willful miSoondtict.
. . . .
Ifany controversy IIrises between the County and any third person. the RefundingTru8tee
shall not be required to. determine the same. or to take any action in the premises, but it may
institute, inits discretion; anintei:pleader or other proceedings in oonllection therewith as it may
deem proper, and in following either COUl"Sl", it shall not be liable.
Section 12. CountvDeoosit of AdditionaIMonev. . The Coi;mty agrees that it will
deposit with the Refunding TruStee in time to make the then current'scheduled debtsetVi.ce
-7-
5p~1
q
, payment the additional money specified in the Refunding Trustee's notice of insufficiency given
plltSUllD.t to Section 7 hereof. '
:';, " .
,. .' ",', SeCtion 13. Remittand of Fun <is When Refunded Bond" Paid in Full. At such time as
the Refutiding Trustee has received the representation of the County that all of the payments
dCscrlbed in Section 3 have. been made and the con:fini:tation of such representationb)' the Fiscal
Agen..t, together with such other evidence of such payments as sb!ill be satisfactory to the Coutrty
and the Refunding Trustee, the Refunding Trustee shall deliver forthwith or remit to the County
any remAining Acquired Obligations, Substitute Obligations, and money held pursuant to this
Re:f!mding Trust Agreement
Section 14. Com0ensati.9n of Refundinll Trustee.. The payment arrangement
heretofore made between the' Refunding Trustee and the County on compensation and expenses
of the Refunding Trustee for services rendered by it pursuant to the provisions of this Refunding
Trust Agreement is satisfactory to it and to the County, and no further payment to the Refunding
Trustee shall be required for Such purpose, except to reimburse the Refunding Trustee for out of
pocket expenses incurred, by the Refunding Trustee hereunder (including, without limitation,
legal fees and expenses). Such arrangement for compensation and expenses is intended as
compensation for the ordinary services as contemplated by this Refunding Trust Agreement, and
jfthe Refunding Trustee renders any service hereunder not provided for in this Refunding Trust
Agreement, or the Refunding Trustee is made a party to or intervenes in any litigation pertaining
to this Refunding Trust Agreement or institutes interpleader proceedings relative heretO, the
Refutiding Trustee shall be compensated reasonabl)' by the County for such ext1'liordinary
serviCes and reimbursed fO,r all fees, costs, liai>ility, and expenses (including reasonable
. attorneys' fees and expenses) occasioned thereby. The Refunding Trustee shall not have a lien '
against ,or otherwise be cOIQ.Pensated for its services and expenses from the money, Acquired
Obligations and Substitute Obligations held pursuant to this Refunding Trust Agreement to make
the payments described in Section 3. "
,Section 15. SuccessorRefundinllTrustee. The obligations assumed by the Refunding
Trustee pursuant to this Refunding Trust Agreement maybe transferred by the Refunding
Trustee to a successor if (a) the successor trustee has presented evidence satisfactory to the
County and to Bond Counsel that the successor trustee meets the requirements of RCW
39.53.070, as now in effect or,hereafter amended; (b) the County approves the appointment of
the successor trustee; (c) the stlcCessor trustee lIas, assumed all of the obligations of the
Refunding Trustee under this Refunding Trust Agreement arid has'been compensated; and (d) all
of the Acquired Obligations, reinvemments. Substitute. Obligations, and money then held by the
Refunding Trustee pQrSUallt,to this Refunding Trust Agreement hav~ been duly ti:ansferred'to
such successor trustee. Ifa successor trustee is not appointOO within 30 days of the Refunding
Trustee's giVing notice ofitsresignation or its removal, the Refunding Trustee shall be entitled
to petition a Court of competent jUrisdiction for the appointment oia successor.
" Notwithstandinganythingtothe contrary contained in this Refunding Trust Agreement,
.any company into which the Refunding Trustee may be merged or converted or with which it
may be consolidated or any company resulting from any merger, conversion, or consolidation to
whichtheRefuilding Trustee is a PartY, 'or ally company to which the Refunding Trustee may
sell or trimsfer an, or substaIitially all of its corporate trust business shall be the 'successOr to the
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~
.
Refunding Trustee without execution or filing of any paper or further act, if such company is
eligible to serve as Refunding Trustee under RCW 39.53.070.
Section 16. Miscellaneous. This Refunding Trust Agreement is governed by
Wa~hjT1gton law without regard to the conflict of laws provisions thereof and may not be
modified except by a writing signed by the parties and subject to the limitations of Section 10. If
anyone 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 provisions of this Refunding Trust Agreement, but this
Refunding Trust Agreement shall be construed as if such invalid, illegal,. or unenforceable
provision had never been contained hereia
Section 17. Notice toRatina Agencies. The Refunding Trustee shall notify all
national rating agencies maintaining (at the request of the County) a rating on the Refunded
Bonds or the Bonds, in writing upon timely receipt of notice or evidence of either of the
following circumstances:
(a) Prior to their taking effect, any amendments to this Refunding Trust
Agreement under Section 10, enclosing the proposed amendatory documents; and
(b) The holding (referred to in Section 16) that one or more provisions of this
Refunding Trust Agreement. are invalid, illegal, or unenforceable in any respect,
enclosing a copy of that holding.
Such notices shall be sent to the applicable rating agencies by first class mail to the addresses
advised by those fating agencies.
Section 18. . Counteroarts.. This Refunding Trust Agreement may be executed in
counterparts.
IN WITNESS WHEREOF, the parties have executed and delivered this Refunding Trust
Agreement pursuant to due and proper authorization, all as of the date and year first above
written.
Jhl<]' bRSON COUNTY, W ASIllNGTON
TIm BANK OF NEW YORK MELLON,
as RefuD.ding Trustee
By
By
y\ Title:
Title:
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511150740.1>
.
.
EXHIBIT A - ACQUIRED OBLIGATIONS
JEFFERSON COUNTY, WASHINGTON
LIMITED TAX GENERAL OBLIGATION AND REFUNDING BONDS, 2011 SERIES B
*CERT -
NOTE-
5.1160740.1
MATURITY PAR IN1EREST
. TYPE* DATE AMOuNT RATE
CERT 12/01/2011 42,443.00 . 0.02%
CERT 06fOl12011 41,798.00 0.09
NOTE 12/0112012 2,051,826.00 0;12
United States Treasury Certificate of Indebtedness-State and Local Government Series
United States Treasury Note-State and Loca1 Government Series
.,
';-
.
EXHIBIT B - COSTS OF ISSUANCE
JEFFERSON COUNTY, WASHINGTON
LIMITED TAX GENERAL OBLIGATION AND REFUNDING BONDS, 2011 SERIES B
Martin Nelson & Co., Inc.
The Bank of New York Mellon
Grant Thornton LLP
Foster Pepper PLLC
Standard and Poor's
TOTAL
Document Fee
Refunding Trustee Fee
EsCrow Verification Fee
Bond Counsel Fee
Rating Fee
$1,000.00
350,00
2,500.00
11,124.00
5,925.00
$20,899.00
51160740.1
.
EXHIBIT C
Notice ofDefeasance*
Jefferson County, Washington
Limited Tax General Obligation Bonds, 2003
NOTICE IS HEREBY GIVEN to the owners of the above-captioned bonds with respect to
which, pursuant to the Refunding Trust Agreement dated as of ~eptember I, 2011, by and between
Jefferson County, Washington (the "County''), and The Bank of New York Mellon (the "Refunding
Trustee"), there has been deposited into an escrow account, held by the Refunding Trustee, cash and
non-callable direct obligations of the United States of America; the principal of and interest on
which, when due, will provide money to pay each year, to and including the respective maturity or
redemption dates of such bonds so provided for, the principal thereof and interest thereon (the
"Refunded Bonds"). Such Refunded Bonds I;11'e therefore deemed to be no longer outstanding
pursuant to Section II of Resolution No. 10-03 of the County relating to the Refunded Bonds, but
will be paid by application of the assets in such escrow account.
The Refunded Bonds are described as follows:
Jefferson County, Washington
Limited Tax General Obligation Bonds, 2003
(Dated March 3, 2003)
Maturity Date Par Amount Interest Call Date CUSIP
(Dec. 1) Defeased Rate (at 100%) Nos.
2013 $ 300,000 4.05% 12/0112012 473629BT9
2014 315,000 4.15 12/0112012 473629BU6
2015 325,000 4.25 12/0112012 473629BV4
2018 1,070,000 4.40 12/0112012 473629BW2
. The County and the Refunding Trustee shall not be responsible for the selection or QSe.ofthe
CUSIP numbers selected, nor is any representation made as to their correctness indicated in the
notice or as printed on any Bond. They are included solely for the convenience of the holders.
The Bank of New York Menon,
as Refunding Trustee
Dated:
. .
· This notice shall be!pven immediately by first class mall to each registered owner of the Refunded Bonds, mc,the MSRB,
Moody's InveStors Service, Inc. and Standard & Poor's at their offices in New York, NeW York, MBIA Insimmce Corporation of
Armonk, New York (policy No. 40383), or their ouccessors, and Martin Nelson & Company, in Seattle, Washington.
SlHi0140.t
,
<
EXHIBIT D
Notice of Redemption ..
Jefferson County, Washington
Limited Tax General Obligation Bonds, 2003
NOTICE IS HEREBY GIVEN that Jefferson County, Washington, (the "County"), has called
for redemption on December I, 2012, all of its outstanding Limited Tax General Obligation Bonds,
2003 (the "Bonds").
The Bonds will be redeemed at a price of one hundred percent (100%) of their principal
JIIIlount,plus accrued interest to December 1,2012. The redemption price of the Bonds is payable on
presentation and surrender of the Bonds at the office of.
[By Mail or in Person]
The Bank of New York MelIon
Worldwide Securities Processing
200 I Bryan Street, 91h Floor
Dallas, TX 75201
-or-
[In Person Oilly]
Any branch of Wells Fargo
Bank, National Association in
the State of Washington
Interest on alI Bonds or portions thereof shall cease to accrue on December 1, 2012.
The following Bonds are being redeemed:
Maturity Date
(December. 1) .
. 2013
2014
2015
2018
Par Amount
Redeemed
$ 300,000
315,000
325,000
1,070,000
Interest
Rate
'4.05%
4.15
4.25
4.40
'CUSIP
Nos.
473629BT9
4736~9BU6
473629BV4
473629BW2
The County and the Refunding TrusteeshalI not be responsible for the selection or use of the
CUSIP numbers selected, nor is any representation made as to their coirectness indicated in the
notice or as printed on any Bond. They are included solely for the .convem,ence of the holders.
By Order of Jeffel'S!ln County, Washington
The Bank of New York Mellon, as Bond Registrar
Dated:
OCJ
Under Section 3406(a)(1) of the Internal Revenue Code the Bond Registrar may be obligated to
withhold a percentage of the principal ob holder who has failed to furnish the Borid RIlgistrar with a
valid taxpayer identification number and a verification that .the owner is not subject to backup
withholding. Owners who wish to avoid the application of these provisions should. submit a
completed IRS Form W-9 when presenting their certificates for payment.
· This notiCe shall be given not less than 30 nor more than 60 days priorto~ 1, 2012, by first class mall, postage
prepai\l, to each registered oWlll;1' of the. redeemed bonds. In addition, notice shall be 'mailed within the Salne period, postage
prepaid, to DTC, the MSRB,Moody's Investors Service, Inc. and Standard& PQ01"s at their offices in New Yorl<, New York,'
MBIA Insurance CorporatiOn of Armonk, New YoIl< (policy No. 40383), or theii successors, and Martin Nelson & Company in
Seattle, Washington.
!1I6O'140.1
}"
.r
August 17,2011
Honorable Board of County Commissioners
Jefferson County
1820 Jeffe>son Street
POBol<571
Port Townsend, W A 98368
Re: Jefferson County, Washington
$2,3sa,ooo Limited Tax General Obligation and Refunding Bonds, 201 i Series B
Dated: September I, 2011
Honorable Commissioners:
Martin Nelson & Co., Inc. ("Purchaser'') offers to purchase from Jefferson County, Washington ("Seller") all of the
above-described bonds (the "Bonds''), on the terms and with the covenants, representations and warranties set forth
below and conlllined in Appendices A and B (collectively the "Contract of Purchase"). These appendices are
incorporated into this Contract of Purcltase by reference, and contain a brief description of the Bonds, including
principal amounts, maturities, interest rates, purchase price, and the proposed date and place of delivery and payment
(the "Closing"). Other provisions of this Contract of Purchase are as follows:
I. Prior to the Closing, Seller will approve the prelintinary official statement regarding the Bonds, dated
August 9, 2011 (the "Prelintimuy Official Statemenf'), and will pass a bond resolution authorizing the
iSsuance of the Bonds (the "Bond Resolution") with snch changes as are requested by the Seller and its
Counsel. The Purchaser is authorized by Seller.to use these documents and the information contained
therein in connection with the public offering of the Bonds and the final official statement in connection
with the sale and delivety of the Bonds (the "Final Official Statement").
2. . Seller, to the best of its knowledge, represents and covenants to the Purchaser that:
(a) it has, as of this date, and will have at the Closing, the power and authority to enter into and
perfonn this Contract ofPurcltase, to pass the Bond Resolution and to deliver and sell the Bonds to
the Purchaser; .
(b) this Contract of Purchase and the Bonds do not and will not conflict with, or consdtote or create a
breach of or default under, any existing law, regulation, order or agreement to which Seller is
subject;
(c) no governmentlil approval or authorization other than those that will be obtained prior to Closing,
is required in connection with the sale of the Bonds to the Purchaser;
(d) the Preliminary Official Statement (except for information concerning The Depository Trust
Company ("OTC"), The. Bank of New York Mellon, and the Purchaser) with corrections, if any, by
the Seller and its Counsel, as of its date and as of the date hereof, is accurate and complete in all
material respects to the knowledge and belief of the officers and employees of the Seller
responsible for the iSsuance of the Bonds, after due review;.
1500 Westlake Avenue N.. Suite 200. Seattle. WA 98109-3031 . P: 206-682-6261
~. ~
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(e) the Seller has previously provided the Purchaser with a copy of the Preliminary Official Statement;
and
(f) the Seller agrees to cooperate with the Purchaser to permit the Purchaser to deliver or cause to be
delivered, within seven business days after any final _agreement to purchase, offer, or sell the
Bonds and in sufficient time to accompany anY confirmation that requests payment from any
customer of the Purchaser, copies of the Final Official Statement in sufficient quantity to comply
with the rules of the Municipal Securities Rulemaking Board ("MSRB"). The Purchaser agrees to
deliver three copies of the Final Official Statement to the MSRB on the business day on witich the
Final Official Statement is available, and in any event no later than seven business dayS after the
date hereof.
3. Seller will pay expenses related to the issuance and sale of the Bonds, including the fees and expenses of the
Bond Counsei firm of Foster Pepper PLLC of Seattle, Washington ("Bond Counsel").
4. This Contract of Purchase is intended to benefit only the parties hereto, and Seller's representations and
warranties shall survive any investigation made by or for the Purchaser, delivery and payment for the
Bonds, and the termination of this Contract of Purchase. Should the Seller fail to satisfY any of the
foregoing conditions or covenants. or if the Purchaser's obligations are terminated for any reasons permitted
under this Contract of Purchase, then neither the Purchaser nor the Seller shall have any further obligations
under this Contract of Purchase.
5. At or prior to the Closing, Seller will deliver, make available to the Purchaser or have adopted:
(a) The Bonds, in-book-entty form only in the name of Cede & Co., as bond owner and nominee for
OTC;
(b) A certificate from an authorized officer of the Seller, in form and substance a<:ceptahle to the SeIJer
and the Purchaser, stating that execution of such certificate shall constitote execution of the Final
Official Statement, and to the knowledge and belief of such officer, after due review, the Final
Official Statement, as of - its date and as of the Closing Date (except that in no event will any
representation be made with respect to information concerning the Purchaser, The Bank of Nl'W
York Mellon, or OTC), does not contain any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein, in the light of the circumstances under
which made, not misleading in any material respect, that there has not been any material adverse
change in the normal operations or financial condition of the Seller, since the date of the Final
Official Statement, and that the representations of the Seller contained in this CoIUraet of Purchase
were true and correct when made and are true and correct as of the Closing Date;
(c) The approving opinion of Bond Counse~ in substantially the form set forth in Appendix A of the
Final Official ~ent, dated the Closing Date;
(d) The following documents executed by an authorized officer of the Seller;
(I) A certificate, dated the day of the Closing to the effect that no litigation or other
proceedings are pending or, to the knowledge of Seller, threatened in any way affecting the
issuance, sale or delivery of. or secutiity for, any of the Bonds; and
(2) A certified copy of the Bond Resolution authorizing the sale of the Bonds.
(e) The Seller agrees to enter into a written agreement or contract, constituting an undertliking (the
~Undertaking") to provide ongoing disclosure about the Seller for the benefit of the owners of the
Bonds on or before the Closing as required by Section (b X5) of Securities and Exchange
Commission Rule 1502-12, and in the form set forth in the Bond Resolution.
2
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>I
6. This offer expires on the date, and at the time, set forth in Appendix A.
Respectfully submitted,
a' .;;4ZY ~~
James M. Nelson
(,,/ . Vice President I Sr. Municipal Underwriter
Public Finance Department
Martin Nelson & Co~ Inc.
-rJ~o '7-q~,
Martin O. Nelson. Jr.
President
Martin Nelson & Co" Inc.
Accepted: August 17, 2011
(Title)
Jefferson County, Washington
Approved as 10 form only:
0tth~ . L ~2.~) II
Jefferson Co. PMHIllltOr~
3
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Appendix A
Description Of
Jefferson County, Washington
$2.3501000 Limited Tax General Oblieation and Refundinl! Bonds. 2011 Series B
(8) Bonds Dated: Date ofInitial Delivery (which is anticipated to be September 1,2011)
(b) Purchase Price: $2,488,539.90 ($105.895315 per $100.00)
(c) Denominations: $5.000, or integral multiples thereof within a single maturity.
(d) Form: Book Entry Only and DTC Eligible
(e) InterestPavmentDate: June I and December l,commencingDecember 1.201l
(I) Pavment Schedule: See Appendix B on the following page.
(g) Ratine: The Bonds are issued with a Standard and Poor's rating of "AA-"
(b) Non-Callable: The Bonds are not subject to redemption prior to their stated maturities.
(i) Closine Date: September I, 20 II
0) Purchase Offer Exoires: 11 :59 p.m.. August 17, 20 n
(k) Bond Counsel: Mr. Marc Greenough, Foster Pepper PLLC, Seattle, Washington
(I) True Interest Cost \.74%
4
Appendix B
Payment ScbednIe of Prlncinal and Interest
JEFFERSON COUNTY ~ADV. REFI au.ABLE 2003 I.'l'OO PLUS
FUND 328,000 JEFF c:.Uf SOF'IWARE 1 YEARS. ASSUMEAA-
$2.3S0,OM
~~Q_~~Q~..~Q.QQca.~aa
Debt sexv1ce Schedule
Date Princ,ipal coupon Interest Period Total Fiscal Total
----_.~.- ~.~.--.------- ---------- --------.--._- -------.-----. ----.-.-------
121 1/11 15.00-0.00 0.600000 15,136.00 30.136.00 30.136.00
(;/ 1/12 10.227.00 30,227.00
12/ l/li 55,000.-00 0.600000 30.22'7.00 35,227.00 115,454.00
6/ 1/13 30,oti2.00 ).0-,062.00
1~/ 1113 365,000.00 0.700000 JtI,062.00 J95,OG2.M 425.124.00
6/ 1/14 28,784.S0 213,7&4.50
12/ -1/14 3'10.000-.00 0.810DOO 28.7S4.~a )98.1&4.50 427,569.00
6/ 1/15 ;01:7,115.00 27.175.00
121 1/15 365,000.00 3.000000 2'1,175.00 392.175. &0 419,350.00
6/ 1/16 21,700.00 21,700.0<1
12/ 1/16 380,.')00.0-0 3.000000 21,1(J().OO 401,700.00 423,400.00
61 1/17 16,000.00 16,000.00
121 1/17 390,000.00 4.000000 16.000.00 406,000.00 422,000.00
6/ 1/18 8.2QO.OO 13,200.00
12/ 1/18 410,000.00 4,000000 8,200.00 418,200.00 426.400.0-0
~ _ ___ . _ . _ w . _. ~ ~---~.~-_._--. -~.~.~_._-----
2,350,000.00 339,433.00 2.689,433.00
ACClW1ID
2.350,000.0.0 339,433.00 2,689.433.00
.-.................... ..-----....--....~ Q..---..------
ttated- 9/. 1/11
BOnd: Yare
Avenge .eoupcm
A~ Life
If :r.C It
With De11~ of 9/ 1/11
11,052.500
h 07109"
4.'103191
1;817626.' U$in9 105.8953149
Weighted Bond Years.
1if'eigtlted Average Life
1f&ighted N Ie"
TIC t
11.982.'158
4.1835515
1.676518' using 105.SjS314~.
J..73160-6 % From Delivery Da:ce
Prepared by: Martin Nelson &- Co'.. txw. - Public Pinance ~ (BSB) 342-6864.
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