HomeMy WebLinkAboutCity Council Committees - Public Facilities Distict Board - 02/20/2008 SPECIAL MEETING
of the
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Wednesday, February 20, 2008, 4 :00 p.m.
I. Call to Order
a. Introductions—All
b. Approval of Minutes of the November 20th, 2007, Special
Meeting - Motion.
II. Project Overview and Update - Ben Wolters
a. Overview of Project Budget
b. Overview of Project Schedule
c. Current Status of Construction
d. Update on Operator Selection
e. Status of Design and Marketing
III. Finance Report - Bob Nachlinger, Hugh Spitzer, William
Tonkin
a. Financial Update
b. Review of Bond Rating
c. Review of Bond Sale
IV. Action Items - Bob Nachlinger, Hugh Spitzer, William Tonkin
a. Resolution 2008-1: Approving the revised Contingency and
Support Agreement
b. Resolution 2008-2: Approving the Bond Resolution on the
Sales Tax Bonds
c. Resolution 2008-3: Approving the Bond Resolution on the
Revenue Bond.
V. Other Business
a. Setting regular meeting time
VI. Executive Session
VII. Adjourn
KEN T
Public Facilities District
November 20, 2007
Board Members Present: Mike Miller, Lew Sellers, Greg Haffner, Randall
Smith, and Cass Prindle.
Others Present: Suzette Cooke, John Hodgson, Tom Brubaker, Bob
Nachlinger, Ben Wolters, Chris Hills, Brenda Jacober and Julie Pulliam from
the City; Brad Tong and Ken Johnson of Shiels Obletz Johnsen; and Colin
Campbell of the Seattle Thunderbirds.
I. Call to Order
a. Introductions. Miller called the meeting to order at 8:00 a.m.,
and introductions were made.
b. Approval of Minutes. Haffner moved to approve the minutes of
the special meeting of September 14, 2007. Sellers seconded and the
motion carried.
II. Project Overview and Update
a. Project Budget. Wolters gave an update on the budget, and
noted that the project is approximately 11% complete.
b. Project Schedule. Wolters noted that the project is
approximately two weeks ahead of schedule in terms of site work,
utilities and underground work. He added that delivery of steel will
begin in December and go through March.
C. Status of Construction. Brad Tong reviewed the Monthly Budget
Report provided to the Board. He noted that the contractor has spent
very little of the contingency and explained that most of the
contingency comes back to the City if it is not used by the contractor.
He added that approximately 73% has been bid out to subcontractors.
Questions regarding pile driving testing, builders risk insurance, and
the cost of the Environmental Impact Statement and Transportation
Impact Analysis were answered. Tong distributed copies of a design
and construction timeline showing which activities have been
completed and noted that the next step is selection of the operator
which is scheduled for December. He pointed out that on July 1, 2008,
Mortenson must advise whether they will take an acceleration
Public Facilities District November 20, 2007
Page Two
incentive of $50,000 a week for four weeks to complete the project
early.
d. Selection of Operator. Wolters noted that representatives from
Global Spectrum, SMG, Benu Works, and IFG attended a pre-submittal
conference, and that bids will be received on November 30. He added
that interviews are tentatively scheduled for the week of December 10
and work is tentatively scheduled to begin on January 16. It was
noted that no local firms submitted bids. Wolters explained that the
proposed length of the contract would be 4.5 or 5 years, three of
which would be operation including one year of helping with pre-
opening, two years of operation, and an option for a two year
extension. It was noted that John Christensen, Executive Director and
CEO of the Washington State Trade and Convention Center, has been
involved in the design of the project and has been retained to staff the
selection process. Wolters stated that Feld Entertainment, which
operates the Barnum and Bailey Circus and Disney on Ice, has
requested dates in 2009 and 2010, and named others who have
expressed interest in using the facility. Hodgson emphasized that the
facility does not have a convention component.
e. Status of Design and Marketing. Wolters reported that the
design advisory group has provided input on the interior design and
said final design and artistic renditions are expected in January. He
added that final design of the plaza will be done if the budget allows.
Traffic improvements and design components were then discussed.
Colin Campbell commented that there is a lot of excitement about the
project, and talked about the marketing and cost of club seats and
suites, and about corporate advertising.
III. Financial Report
a. Financial Update. Finance Director Bob Nachlinger noted that
approximately $12,000,000 has been spent, and that bonds need to
be sold.
b. Implementation of PFD Tax Collection by Department of
Revenue. Nachlinger noted that the PFD tax will be instituted
on January 1, 2008, and that the first money will be received on
March 20, 2008. He added that it will be received for twenty-five
years.
Public Facilities District November 20, 2007
Page Three
C. Strategy to Sell Bonds. Nachlinger provided information on
interest rates and said he is anticipating issuing one bond issue with
three series of bonds: Series A would be the sales tax funded bonds,
Series B would be the taxable portion of the bonds, and Series C
would be the tax exempt portion of the bonds. He explained that
because of the type of pledge of PFD and City revenues to this facility,
debt service costs come before operations and maintenance costs, but
that money is being budgeted to a renewal and replacement fund for
this project.
d. Selection of Bond Underwriter. Nachlinger explained the
selection process and announced that Lehman Brothers Wachovia
Securities and Piper-Jaffrey have been selected as the underwriting
team.
e. Selection of Financial Advisor. Nachlinger stated that Seattle
Northwest Securities has been selected as the Financial Advisor, and
that they have expertise in marketing Washington bonds.
IV. Action Items
a. Contingent Loan and Support Contract. Tom Brubaker
explained that the proposed resolution authorizes various bond and
financing issues. He explained that the reason for an interlocal
agreement between the City and the PFD is because they are so
closely tied together, and noted that it lays out the terms so that
assurance can be given to the bond issuers that the bonds are
properly backed and will be paid off. It was clarified that any major
changes would be brought to this group, but that small changes could
be handled by the Chair. Sellers moved to enact Resolution 2007-5
approving the "Contingent Loan and Support Agreement" regarding
financing for the Kent Special Events Center between the PFD and the
City, and authorizing the Chair of the Board of Directors to execute the
agreement subject to approval of the final terms and conditions by the
City Attorney. Haffner seconded and the motion carried.
V. Other Business
ADDED ITEM - Washington Governmental Entity Pool Membership.
The City's Risk Manager Chris Hills requested that this item be added
to the agenda. Haffner moved to waive the notice requirement,
Sellers seconded and the motion carried.
Public Facilities District November 20, 2007
Page Four
Hills explained the Washington Governmental Entity Pool and the
benefits of membership. He provided a copy of an Interlocal
Agreement for the purpose of providing property and liability insurance
coverage for the District. Haffner moved to adopt Resolution 2007-6
authorizing membership with the Washington Governmental Entity
Pool for the purpose of providing liability and property insurance for
the district; approving an interlocal governmental contract and
authorizing execution thereof; and accepting a memorandum of
insurance coverage under such contract. Smith seconded and the
motion carried.
a. Tour of Construction Site. Wolters noted that Julie Pulliam will
set up tours for individual Board members, or for two at a time.
ADDED ITEM - Next Meeting Time. It was determined that there is
no urgent business at this time and that the next meeting will be in
January. Agenda items will include an update on the bond sale and
setting a time for regular meetings.
VI. Executive Session
No Executive Session was held.
VII. Adjourn
Sellers moved to adjourn at 9:50 a.m. Prindle seconded and the
motion carried.
Brenda Jacober, CMC
City Clerk
RESOLUTION NO. 2008-1
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
A RESOLUTION of the Board of Directors of the City of Kent
Special Events Center Public Facilities District confirming approval
and authorizing the execution and delivery of a contingent loan
and support agreement are related documents and authorizing
certain other actions in connection therewith.
RECITALS
A. The City of Kent Special Events Center Public Facilities District, a Washington public
facilities district duly organized and existing under the laws of the State of Washington (the
"District'), was created by the City of Kent, Washington (the "City") pursuant to Ordinance No.
3852, enacted by the City on August 7, 2007, in accordance with chapter 35.57 of the Revised
Code of Washington ("RCW"), to assist in the design, construction, ownership, operation and/or
financing of regional centers as defined in RCW 35.57.020.
B. The Washington Interlocal Cooperation Act (RCW 39.34) authorizes a public facilities
district to contract with any other public agency of the State of Washington to perform any
governmental service, activity or undertaking which each entity is authorized to perform.
C. The District and the City entered into an Interlocal Agreement for Development of
Special Events Center dated September 14, 2007, to provide for the financing, design,
construction, ownership and operation of a special events center for hockey and other public
uses, together with related parking (the "Special Events Center").
D. The City has requested that the District issue, and the District has expressed its intent to
issue its Special Events Center sales tax bonds and Special Events Center revenue bonds in an
estimated original aggregate principal amount of$62,060,000 (collectively, the "Bonds") to pay a
portion of the capital costs of the Special Events Center.
E. The District and the City intend to enter into a Contingent Loan and Support Agreement
Regarding Financing for Kent Special Events Center substantially in the form attached hereto as
Exhibit A and incorporated herein by reference (the "Contingent Loan and Support Agreement')
to provide for the payment of operation and maintenance expenses of the Special Events
Center and to provide credit support for the Bonds to permit the District to obtain financing for
the capital costs of the Special Events Center at the lowest interest rates available.
F. The Board of Directors (the 'Board") of the District has determined that it is appropriate
and in the best interests of the District to execute the Contingent Loan and Support Agreement.
G. The Board of the District by Resolution No. 2007-5 previously approved and authorized
the Chair of the Board to execute a Contingent Loan and Support Agreement substantially in the
form attached to that resolution.
soeesa44J
1 Contingent Loan and Support Agreement Authorization
H. The Board of the District has determined that it is appropriate and in the best interests of
the District to confirm its approval and authorization of the District's execution of the Contingent
Loan and Support Agreement substantially in the form set forth as Exhibit A to this resolution.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE
CITY OF KENT SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT, as follows:
Section 1. Approval of Contingent Loan and Support Agreement. The Contingent
Loan and Support Agreement attached as Exhibit A is approved, and the Chair of the Board is
authorized to execute it in substantially the form set forth as Exhibit A, together with such
modifications as he deems appropriate and consistent with its purpose. The Chair is authorized
to make such additional adjustments to the provisions of the Contingent Loan and Support
Agreement as may be approved by the City and as he deems to be in the interest of the District.
Section 2. Authorization to Act and Enter into Agreements. The Chair of the Board
and any other officer of the District is authorized, jointly and severally, to do any and all things
and to execute and deliver any and all documents, agreements and certificates and other
instruments which they may deem necessary or advisable in order to carry out, give effect to
and comply with the terms and intent of this Resolution and any other documents executed and
delivered pursuant to the authority granted in this Resolution.
Section 3. Acting Officers Authorized. Any actions of the District required by this
Resolution to be taken by the Chair of the Board may be in the absence of such person be
taken by the duly authorized acting Chair of the Board.
Section 4. Ratification of Prior Acts. All acts prior to the effective date of this
Resolution and consistent with its terms are ratified and confirmed.
Section 5. Effective Date. This Resolution shall be in full force and effect from and
after its adoption.
ADOPTED this 20" day of February, 2008.
Chair, Board of Directors
50889444A
2 Contingent Loan and Support Agreement Authorization
EXHIBIT A
FORM OF CONTINGENT LOAN AND SUPPORT AGREEMENT
50889444.1
A-1 Contingent Loan and Support Agreement Authorization
CONTINGENT LOAN AND SUPPORT AGREEMENT
REGARDING FINANCING
FOR KENT SPECIAL EVENTS CENTER
BY AND BETWEEN
THE CITY OF KENT
AND
THE CITY OF KENT SPECIAL EVENTS
CENTER PUBLIC FACILITIES DISTRICT
50853182.5
TABLE OF CONTENTS
Page
__.. Section 1. DefinitinnS.an rl.Internrata4i.n
1.1 Definitions................................................................................................................3
1.2 Interpretation............................................................................................................5
Section 2. Effect on Interlocal Agreement No. 1......................................................................5
Section 3. Contingent Loan Agreement....................................................................................5
3.1 City Contingent Loan Commitment for Bonds........................................................5
3.2 Contingent Loan Procedures; Time and Amount of Loans.....................................6
(a) Notice of Insuffrciency................................................................................6
(b) Cancellation Notices....................................................................................6
(c) Loans............................................................................................................6
(d) Method of Notice.........................................................................................6
(e) Assumed Payment of City Special Events Center Payments.......................6
3.3 District Repayment to City for Amounts Loaned pursuant to Contingent
LoanCommitment...................................................................................................7
3.4 District Disclosure Documents................................................................................7
Section 4. Priority of Payments from Sales Tax Revenue, District Revenue ("Flow of
Funds").....................................................................................................................7
4.1 Sales Tax Revenue...................................................................................................7
4.2 Special Events Center Revenues..............................................................................8
Section 5. Deposit and Requisition of Bond Proceeds .............................................................9
Section 6. City Events Center Payments; City Responsible for Operation and
Maintenance of Special Events Center. ...................................................................9
6.1 City Events Center Payments...................................................................................9
6.2 Operation and Maintenance of Special Events Center..........................................10
63 Payment of Operation and Maintenance Expenses................................................10
6.4 District Not Responsible for Operation and Maintenance of the Special
EventsCenter.........................................................................................................10
6.5 Fees, Rates and Charges for Use of Special Events Center...................................10
6.6 Insurance................................................................................................................10
6.7 Sale, Transfer or Disposition of the Special Events Center...................................11
6.8 Preservation of Tax Exemption for Interest on the Tax-Exempt Bonds................I I
6.9 Local Match Requirement......................................................................................12
Section 7. District Covenants..................................................................................................12
7.1 Reporting Requirements ........................................................................................12
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Page
7.2 Restriction on Issuance of Additional Parity Bonds..............................................12
Section8. Defaults..................................................................................................................12
8.1 Remedies of City on District Default.....................................................................12
8.2 Remedies of District Upon City Default................................................................12
8.3 No Remedy Exclusive............................................................................................13
8.4 No Implied Waiver................................................................................................13
Section 9. Compliance with Continuing Disclosure Requirements........................................13
Section10. Miscellaneous ........................................................................................................14
10.1 Termination............................................................................................................14
10.2 Governing Law; Venue..........................................................................................14
10.3 Joint Exercise of Powers; Administrator...............................................................14
10.4 Notices ...................................................................................................................14
10.5 Binding Effect........................................................................................................15
10.6 Severability............................................................................................................15
10.7 Amendments..........................................................................................................15
10.8 No Rights Created in Third Parties........................................................................15
10.9 Execution in Counterparts......................................................................................15
10.10 Effective Date ..................................:.....................................................................15
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508531815
CONTINGENT LOAN AND SUPPORT AGREEMENT
REGARDING FINANCING
FOR DENT SPECIAL EVENTS CENTER
THIS CONTINGENT LOAN AND SUPPORT AGREEMENT (this "Agreement") is
dated as of the 20"' day of February, 2008, and is made by and between THE CITY OF KENT,
WASHINGTON (the "City'), and THE CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT (the "District");
RECITALS
WHEREAS, Chapter 35.57.020 of the Revised Code of Washington ("RCW")provides
that a public facilities district may acquire, construct, own, remodel, maintain, equip, repair,
finance, and operate one or more regional centers; and
WHEREAS, the City has previously determined that the acquisition and operation of
such a regional center is in the interest of the City, and by Ordinance No. 3853 passed on
August 7, 2007 (the "District Formation Ordinance"), established the District pursuant to
RCW 35.57, to assist in the design, construction, ownership, operation and/or financing of a
regional center as defined in RCW 35.57.020 as a convention, conference or special events
center, and related parking facilities, serving a regional population (the "Special Events
Center"); and
WHEREAS, the Washington Interlocal Cooperation Act (RCW 39.34) authorizes a
public facilities district to contract with any other public agency of the State of Washington (the
"State") to perform any governmental service, activity or undertaking which each entity is
authorized to perform; and
WHEREAS, the City and the District previously entered into an Interlocal Agreement for
Development of Special Events Center dated September 14, 2007 ("Interlocal Agreement
No. I"), pursuant to the Washington Interlocal Corporation Act in cormection with the
development and operation of the Special Events Center; and
WHEREAS, pursuant to State law, the District Formation Ordinance and Interlocal
Agreement No. 1, the District is authorized to issue revenue bonds or general obligation bonds in
principal amounts approved by the City consistent with RCW 35.57.030, 35.57.090 and other
applicable provisions of state law for the purpose of providing for part of the cost of joint
development of the Special Events Center; and
WHEREAS, all such bonds of the District will be satisfied exclusively from the assets,
revenues and credit of the District except and to the extent the City expressly agrees to make a
loan to the District to provide for the payment of such obligations; and
WHEREAS, under Interlocal Agreement No. 1 and Resolution No. 2007-1 of the Board
of Directors of the District adopted on September 14, 2007 (the "PFD Tax Resolution"), the
District imposed the sales and use taxes authorized by RCW 35.57.040(1)(d) and
RCW 82.14.390 at the rate of 0.033% of the selling price (in the case of a sales tax) or the value
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50853182.5
of the article used (in the case of a use tax) (the "Sales Tax") and agreed to set aside the
proceeds of such Sales Tax to be paid to the City for the purpose of providing for part of the cost
of designing, constructing, owning and operating the Special Events Center, and/or to provide
part of the debt service on District bonds or obligations issued to provide for part of such costs;
_._, ... .._ and _.._ __ __. .. _. . .. _... .. _ __ _..... ..
WHEREAS, the City commenced construction of the Special Events Center on July 27,
2007, in satisfaction of the requirements of RCW 35.57.040(1)(d) that construction of a regional
center be commenced prior to July 1, 2008; and
WHEREAS, the City has designated and provided approximately 17.5 acres of land
owned by the City with an estimated value of $30,000,000 as the site on which the Special
Events Center is being constructed, and also is contributing at least $14,400,000 of City funds
and State grant proceeds toward the cost of construction of the Special Events Center in
satisfaction of the requirement of RCW 82.14.390(4) for the provision of land, cash or in-kind
contributions for the regional center from other public or private sources equal to 33°/u of the
amount of sales and use taxes collected and to be collected for a regional center; and
WHEREAS, the City has requested that the District issue (i) its Special Events Center
Sales Tax Bonds, 2008, in an original principal amount not to exceed [$ (the "Sales
Tax Bonds") payable from the Sales Tax Revenue and District Revenue, and (ii) its Special
Events Center Revenue Bonds, 2008 (Taxable), in an original principal amount not to exceed
[$ ] (the "Revenue Bonds")payable from District Revenue; and
WHEREAS, the District intends to issue its Sales Tax Bonds and Revenue Bonds and to
make proceeds thereof available to pay for a portion of the capital costs of the Special Events
Center; and
WHEREAS, the District has requested that the City provide credit support to the District
to permit the District to obtain financing for the capital costs of the Special Events Center at the
lowest interest rates available; and
WHEREAS, the City will own and operate or provide for the operation of the Special
Events Center and will pay operation and maintenance expenses of the Special Events Center
and collect Special Events Center Revenues, all as provided in this Agreement; and
WHEREAS, in consideration for the District's issuance of the Bonds for the construction
of the Special Events Center, the City is willing to provide credit support for the District's Sales
Tax Bonds and Revenue Bonds, and the City Council of the City by Ordinance No. 3863 has
authorized the City to enter into this contingent loan and support agreement;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, the
parties hereto covenant and agree as follows.
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50853182.5
Section 1. Definitions and Interpretation.
1.1 Definitions. As used or referred to in this Agreement, unless the context
otherwise requires, the following terms shall have the meanings given to them in the Recitals of
this Agreeinrnt
Agreement RCW
City Revenue Bonds
District Sales Tax
District Formation Ordinance Sales Tax Bonds
Interlocal Agreement No. 1 Special Events Center
PFD Tax Resolution State
In addition, unless the context requires otherwise, the terms defined in this section shall, for all
purposes of this Agreement, have the meanings specified herein, to be equally applicable to both
the singular and plural forms of any of the terms defined herein.
"Additional Revenue Bonds"means bonds that the District may hereafter issue pursuant
to Section 18 of Resolution [2008-_] of the District adopted February_, 2008 (the"Revenue
Bond Resolution") that are secured by a lien upon the District Revenue that is equal to lien upon
the District Revenue in favor of the Revenue Bonds and Sales Tax Bonds.
"Additional Sales Tax Bonds" means bonds that the District may hereafter issue
pursuant to Section 19 of Resolution [2008-__] of the District adopted February_, 2008
(the "Sales Tax Bond Resolution") that are secured by a lien upon the Sales Tax Revenue that is
equal to the lien upon the Sales Tax Revenue in favor of the Sales Tax Bonds.
"Bonds" means the Revenue Bonds, the Sales Tax Bonds, any Additional Revenue
Bonds and any Additional Sales Tax Bonds.
"Business Day" means any day, other than a Saturday or a Sunday, on which banking
institutions are open in the State and in the states in which the principal corporate trust office of
the Trustee and any of the offices of the Bond Registrar designated from time to time by the
Bond Registrar for the transfer or exchange of Bonds are located.
"City Contingent Loan Payments" means any loan payments made by the City to the
District for Required Debt Service pursuant to the Contingent Loan and Support Agreement that
are derived from City fiinds other than Special Events Center Revenues.
"City Special Events Center Payments"means all payments required to be made by the
City to the District for the First through Fourth purposes listed in Section 4.2 that are derived
from and represent Special Events Center Revenues.
"Debt Service Payment Date" means any date on which principal of and/or interests on
any Bond is due and payable as provided in the applicable authorizing resolution.
"District Revenue"means all revenue, earnings and money received by the District from
and on account of the City Special Events Center Payments and City Contingent Loan Payments.
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50853182.5
"Fiscal Agent"means the fiscal agent of the State, initially The Bank of New York.
"Operation and Maintenance Expenses" means all reasonable expenses incurred in
causing the Special Events Center to be operated and maintained in good repair, working order
_ and cnllditioll ill hiding without.h r"tatiunf ID'^a^.meat fees or otherpayments to tb&d-palines
.a without_ .. ». e" v p
payable in respect of the operation of the Special Events Center; personnel costs; the cost of
ordinary maintenance and repair; utilities; supplies; food and beverage service and supply costs;
equipment purchase and lease payments; administrative expenses, including administrative
.expenses of the District; the costs of advertising, marketing and business promotion; deposits,
premiums, assessments or other payments for insurance; and taxes and assessments; all as
determined in accordance with generally accepted accounting principles applicable to the City
and its operations. The term "Operation and Maintenance Expenses" does not include any
depreciation of or capital expenditure for the Special Events Center.
"Project"means the design and construction of the Special Events Center.
"Required Debt Service" means, for any calendar year, with respect to the Bonds, the
amount required to make scheduled payment of principal of (including mandatory redemption
payments with respect to Tenn Bonds) and interest on the Bonds in that calendar year.
"Revenue Bond Insurance Policy" shall mean any bond insurance policy or credit
facility issued by a Revenue Bond Insurer insuring the payment when due of the principal of and
interest on the Revenue Bonds or any Additional Revenue Bonds, as provided therein.
"Revenue Bond Insurer" shall mean, any bond insurer or credit provider (other than the
City) undertaking to insure or provide credit support for the Revenue Bonds or any series of
Additional Revenue Bonds, and designated as such in the applicable authorizing resolution.
"Sales Tax Bond Insurance Policy" shall mean any bond insurance policy or credit
facility issued by a Sales Tax Bond Insurer insuring the payment when due of the principal of
and interest on the Sales Tax Bonds or any Additional Sales Tax Bonds, as provided therein.
"Sales Tax Bond Insurer" shall mean, any bond insurer or credit provider (other than
the City) undertaking to insure or provide credit support for the Sales Tax Bonds or any series of
Additional Sales Tax Bonds, and designated as such in the applicable authorizing resolution.
"Sales Tax Revenue" means all the money received by the District from the Washington
State Department of Revenue on account of the Sales Tax imposed by and collected for the
District.
"Special Events Center Revenues"means all revenue, earnings and money received by
the City from or on account of the operation and/or ownership of the Special Events Center,
including but not limited to license fees received by the City from Thunderbird Hockey
Enterprises, LLC (the "Team") pursuant to the License Agreement dated August 7, 2007 (the
"License Agreement"), by and between the City and the Team, facility fees, concession
revenues, advertising revenues, suite license revenues, club seat revenues, parking revenues and
naming rights revenues.
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50853182.5
"Tax-Exempt Bonds" means the Sales Tax Bonds and any Additional Sales Tax Bonds
and Additional Revenue Bonds the interest on which is excludable from the gross income of the
holders thereof for federal income tax purposes.
" Eln-Y_l n.n_Ac_"_meal-s »_l Bonds µs such in the uY.Yuoa_LU3ID- auulULlZlllg
resolution.
1.2 Interpretation. Unless otherwise clear from the context of the terms,
words or pleases, the following principles govern the interpretation of terms, words and phrases
used in this Agreement:
(a) Sections, paragraphs and clauses mentioned by number only
without reference to another document are those so numbered that are contained in this
Agreement.
(b) Captions, titles or headings preceding any article, section or
subsection herein, and any table of contents or index attached hereto, are solely for convenience
of reference and are not part of this Agreement and shall not affect its meaning, constmction or
effect.
(c) Terms such as "herein," "hereunder," "hereby," "hereto" and
"hereof' refer to this Agreement as a whole and not to any particular section hereof unless so
indicated; "heretofore" and"hereafter"mean before and after the date of this Agreement.
(d) Words importing any gender include masculine, feminine and
neuter genders, where applicable.
(e) Words importing the singular number include the plural number,
and vice versa, where applicable.
Section 2. Effect on Interlocal Agreement No. 1. This Agreement shall supplement
and supersede the provisions of Interlocal Agreement No. 1 to the extent of any inconsistency
between this Agreement and Interlocal Agreement No. 1. Except to the extent supplemented or
superseded by this Agreement, all obligations of the City and the District set forth in Interlocal
Agreement No. 1 shall remain in full force and effect.
Section 3. Contingent Loan Agreement.
3.1 City Contingent Loan Commitment for Bonds. In the event that the
District is unable to timely provide for the payment of principal of or interest on any Bonds, the
City.shall loan to the District the amount necessary to make such timely payment. The District
agrees to borrow the amounts described above from the City pursuant to this Agreement and to
apply those amounts immediately for the purpose of meeting its obligations with respect to the
Bonds. The District shall transfer the proceeds of each City loan directly to the Fiscal Agent to
be applied to the payment of debt service on the Bonds. The City on behalf of the District may
transfer those loan amounts directly to the Fiscal Agent. The total amount of funds to be loaned
by the City pursuant to this Section 3 shall not exceed the principal amount of and interest on
the Bonds. The obligation of the City to advance funds to the District in the amounts, at the
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times and in the manner described herein shall be absolute and unconditional, and shall not be
subject to diminution by setoff, counterclaim, abatement or otherwise. The full faith, credit and
resources of the City are pledged irrevocably for the payment to the Fiscal Agent of the amounts
described herein.
3.2 Contingent Loan Procedures; Time and Amount of Loans.
(a) Notice of Insufficiency. On the 15`h day of the month preceding
each Debt Service Payment Date (or if the 15th is not a Business Day, then the next Business
Day), the District shall review the amount on deposit in the District's Revenue Bond Debt
Service Fund and/or the District's Sales Tax Bond Debt Service Fund, as applicable, to
determine whether there will be sufficient money available in the applicable Debt Service Fund
to make the required payment due on the upcoming Debt Service payment Date. If, upon such
review, it appears that the money available in the applicable Debt Service Fund will be
insufficient to make that payment, the District shall provide the City a notice in substantially the
form attached hereto as Exhibit A (a"Notice of Insufficiency")within five days after the date on
which the review was required. Failure of the District to give a Notice of Insufficiency to the
City shall not relieve the City of its obligation to make loans upon demand by the District.
(b) Cancellation Notices. If, at any time before 10 a.m. (Pacific Time)
on the 24°i day of the month preceding an upcoming Debt Service Payment Date for which the
District has given a Notice of Insufficiency (or, if the 24`h is not a Business Day, the Business
Day preceding the 24"h), the District determines that there will be sufficient money available in
the applicable Debt Service Fund to make the required payment due on the upcoming Debt
Service Payment Date, the District shall provide, prior to 5 p.m. (Pacific Time) on the same day,
a notice to the City in substantially the form attached hereto as Exhibit B (a "Cancellation
Notice"). Delivery of a Cancellation Notice by the District to the City shall not relieve the City
of its obligations to make loans upon demand by the District.
(c) Loans. For so long as any Bonds remain outstanding, the City
shall, no later than 10 a.m. (Pacific Time) on the Business Day preceding a Debt Service
Payment Date, lend to the District an amount that, when added to the money available in the
applicable Debt Service Fund, is sufficient to make all payments of principal of and interests on
the Bonds due on the upcoming Debt Service Payment Date. The City shall cause the amount of
each loan hereunder to be transferred to the District in United States Dollars and immediately
available funds.
(d) Method of Notice. Notices of Insufficiency and Cancellation
Notices shall be sent by the District to the Finance Director of the City on the day on which it is
to be given by messenger or telecopy or other electronic means capable of producing a written
notice.
(e) Assumed Payment of City Special Events Center Payments.
Solely for the purpose of determining whether sufficient money will be available in the
applicable Debt Service Fund on any Debt Service Payment Date, the parties may assume that
the City will make City Special Events Center Payments to the District at the times, and in the
6
50853192.5 -
amounts, required by this Agreement, except to the extent the City has otherwise notified the
District.
3.3 District Repayment to City for Amounts Loaned pursuant to
CnntinoPnt.T.nan fnmm' c-t. ...If 4 !".'ty vaa s ••'••n +,. + c -Iist Jc i _..
_. .... -`-- ---' _ ___ _it'R"..... �� -.he- ty l'••d^ ..ava..y'- w-eh,;- u naa.t pi:u SAaiit- tv tlliS'
b
Section 3, the District shall repay the principal amount or amounts loaned as revenues for that
purpose become available consistent with Section 4, below, and the outstanding principal amount
of any such loan shall bear interest at a rate set by the City's Finance Director on the date a loan
is made,based on the then-current yield of the City's pooled investments. The rate of interest on
the outstanding principal amount of any loan made by the City pursuant to this Agreement shall
be revised each year during the budget process based on the then-current yield of the City's
pooled investments, and effective on the same date that the City's interfund loan interest rate is
adjusted for all City interfund loans.
3.4 District Disclosure Documents. The District may, in disclosure
documents related to the Bonds, describe or attach a form of this Agreement. However, those
disclosure documents shall contain a statement to the effect that the Bonds are payable solely
from the specified sources and other money of the District legally available therefor, and from
the transfer of the funds by the City to the District or the Fiscal Agent, but that the Bonds are not
obligations of the City. The City acknowledges that the District will pledge District Revenue to
the payment of the Bonds. The parties to this Agreement acknowledge that lenders to the
District, including Bond owners, will rely on the terms of this Agreement, including the pledge
by the City to make the advances at the times and in the amounts set forth in Section 3. The City
acknowledges that its commitments under this Agreement constitute valid and binding
enforceable contractual obligations.
Section 4. Priority of Payments from Sales Tax Revenue, District Revenue
("Flow of Funds").
4.1 Sales Tax Revenue. For so long as any Sales Tax Bonds or Additional
Sales Tax Bonds remain outstanding, all Sales Tax Revenue shall be transferred to and deposited
into the Sales Tax Revenue Fund when and as received by the District or by the Finance Director
of the City, as ex officio Treasurer of the District. Sales Tax Revenue deposited therein, together
City Special Events Center Payments to the extent necessary to provide for the First through
Fourth purposes below, and together with City Contingent Loan Payment to the extent necessary
to provide for the First through Third purposes below, on the third Business Day prior to each
Debt Service Payment Date shall be disbursed for the following purposes in the following order
of priority:
First, to make the required deposits to the Sales Tax Bond Debt Service Fund
for the payment of interest due on the Sales Tax Bonds and any Additional
Sales Tax Bonds;
Second, to make the required deposits to the Sales Tax Bond Debt Service Fund
for the payment of principal of the Sales Tax Bonds and any Additional
Sales Tax Bonds due at maturity or upon mandatory sinking fund
redemption prior to scheduled maturity;
7
508531825
Third, to reimburse any Sales Tax Bond Insurer for any payments made under
any Sales Tax Bond Insurance Policy and any other amounts due and
owing to any Sales Tax Bond Insurer in respect of the Sales Tax Bonds or
any Additional Sales Tax Bonds;
Fourth, to repay principal of and interest on any loans made by the City to the
District as provided in Section 3.3 in respect of payments of principal of or
interest on the Sales Tax Bonds or any Additional Sales Tax Bonds; and
Fifth, to provide for costs of and reserves for long-term capital repairs, renewals
and replacements of the Special Events Center, and for other lawful
purposes, in no particular order of preference and all as determined by the
City in consultation with the District.
The District and the City shall exercise due regard for the anticipated financial
requirements to be satisfied as priorities First through Third of this Section 4.1 in each calendar
'year prior to authorizing or making any disbursement of money in the Special Events Center
Sales Tax Revenue Fund for the purposes identified as priority Fourth.
4.2 Special Events Center Revenues. For so long as any Bonds remain
outstanding, the City for itself and on behalf of the District shall collect Special Events Center
Revenues and shall transfer City Special Events Center Payments to the District for deposit into
the.District Revenue Fund. City Special Events Center Payments deposited therein, together
with City Contingent Loan Payments as required for the First through Third purposes below, on
the third Business Day prior to each Debt Service Payment Date shall be disbursed for the
following purposes in the following order of priority:
First, to make the required deposits to the Revenue Bond Debt Service Fund for
the payment of interest due on the Revenue Bonds and any Additional
Revenue Bonds and, after taking into account Sales Tax Revenues
available to the District for the payment of interest due on the Sales Tax
Bonds and any Additional Sales Tax Bonds, to make required deposits to
the Sales Tax Bond Debt Service Fund for the payment of interest on the
Sales Tax Bonds and any Additional Sales Tax Bonds
Second, to make the required deposits into the Revenue Bond Debt Service Fund
for the payment of principal of the Revenue Bonds and any Additional
Revenue Bonds at maturity or upon mandatory sinking fund redemption
prior to scheduled maturity and, after taking into account Sales Tax
Revenues available to the District therefor, to make required deposits to
the Sales Tax Bonds Debt Service Fund for the payment of principal of the
Sales Tax Bonds and any Additional Sales Tax Bonds at maturity or upon
mandatory sinking fund redemption prior to scheduled maturity;
Third to reimburse any Revenue Bond Insurer for any payments made under any
Revenue Bond Insurance Policy and other amounts due and owning to any
Revenue Bond Insurer in respect of the Revenue Bonds and any
8
50853182.5
Additional Revenue Bonds and, after taking into account Sales Tax
Revenues available to the District for the payment thereof, to reimburse
any Sales Tax.Bond Insurer for any payments made under any Sales Tax
Bond Insurance Policy and other amounts due and owing to any Sales Tax
- Doiid ii suio iii respect u 'tile Sales Tax Bonds and any Additional Sales`
Tax Bonds;
Fourth, to repay principal of and interest on any loans made by the City to the
District as provided in Section 3.3 in respect payments of principal of or
interest on the Bonds; and
Fifth, to provide for costs of and reserves for long-term capital repairs, renewals
and replacement of the Special Events Center, and for other lawful
purposes, in no particular order of preference and all as determined by the
City in consultation with the District.
The District and the City shall exercise due regard for the anticipated financial
requirements to be satisfied as priorities First through Fourth of this Section 4.2 in each calendar
year prior to authorizing or making any disbursement of money in the Special Events Center
Revenue Fund for the purposes identified as priority Fifth. Any amounts received by the City or
the District as governmental grants or private contributions for the Special Events Center shall be
deposited in a special capital account in the Public Facilities District Special Events Center
Revenue Fuld and be used for the construction, renewal and replacement of facilities comprising
the Special Events Center, unless another use is required by the terms of any such governmental
grant or private contribution.
Section S. Deposit and Requisition of Bond Proceeds. The proceeds received by
the District from the sale and delivery of the Bonds shall be paid into applicable Account within
the Project Fund and shall be used to pay a portion of the cost of acquiring, constructing and
equipping the Special Events Center, to fund capitalized interest on the Bonds during
construction, to [pay the premium for the Sales Tax Bond Insurance Policy/Revenue Bond
Insurance Policy], and to pay the costs of issuance and sale of the Bonds. Proceeds of the Bonds
allocated to pay the cost of acquiring, constructing and equipping the Special Events Center shall
be transfeiTed to the City for that purpose upon receipt of a requisition from the City for the
payment of such costs in substantially the form attached hereto as Exhibit C supported by
documentation provided to the City under the City's contracts for the construction of the Special
Events Center that the City determines to be sufficient.
Section 6. City Events Center Payments; City Responsible for Operation and
Maintenance of Special Events Center.
6.1 City Events Center Payments. For so long as any Bonds remain
outstanding, the City for itself and on behalf of the District shall collect Special Events Center
Revenues and shall transfer City Special Events Center Payments to the District for deposit into
the District Revenue Fund sufficient to pay the First through Fourth purposes listed in Section
4.2. The City Special Events Center Payments shall have priority over other uses of Special
Events Center Revenues.
9
50853182.5
6.2 Operation and Maintenance of Special Events Center. The City will
proceed with due diligence to complete the construction of the Special Events Center. At all
times from and after the completion of the Special Events Center for so long as any Bonds are
outstanding, the City, for itself and on behalf of the District, shall take all actions necessary to:
- - - - �iwyi,iaw vrCaiiSc iliG vpeG3al-l.vcuts Gcucc3 tolicoperatcd ytopelly AS-a "regional CeRLCr' (as
- -
that term is defined in RCW 35.57) and a "tourism-related facility (as that term is defined in
RCW 67.28) in a sound and economical manner consistent with commercially reasonable
industry practices and standards for facilities similar to the Special Events Center and in
accordance with the License Agreement, (ii)maintain or cause the Special Events Center to be
maintained in compliance with all applicable legal requirements and promptly remedy(or contest
in good faith) any violations thereof, and (iii)maintain, preserve and keep the Special Events
Center, or cause the Special Events Center to be maintained, preserved and kept, with the
appurtenances and every part and parcel thereof, in lawful order and in good repair, working
order and condition, from time to time to make or, cause to be made, all necessary and proper
repairs, replacements and renewals so that at all times the operation thereof may be properly and
advantageously conducted, and not commit or suffer any unreasonable waste with respect
thereto.
6.3 Payment of Operation and Maintenance Expenses. The City shall pay
or cause to be paid all Operation and Maintenance Expenses from Special Events Center
Revenues and other City money legally available therefor.
6.4 District Not Responsible for Operation and Maintenance of the
Special Events Center. It is understood that the District shall have no responsibility for the
operation or maintenance of the Special Events Center or for the acts of the City, its employees,
agent, users of the Special Events Center or its or their officers, directors, managers, members or
shareholders, or any party acting by, through or on behalf of any such parties. The District shall
not be responsible for payment of Operation and Maintenance Expenses.
6.5 Fees, Rates and Charges for Use of Special Events Center. From and
after the completion of the Special Events Center, subject to the terms of the License Agreement,
the City for itself and on behalf of the District shall'cause fees, rates and charges to be fixed,
maintained and collected for the use of the services and facilities and all commodities sold,
furnished or supplied by or through the Special Events Center, which fees, rates and charges
shall be adjusted from time to time as necessary, so that (i) such fees, rates and charges will be at
optimal levels to produce total Special Events Center Revenues that will at all times be at least
sufficient to enable the City to make City Special Events Center Payments to the District in the
amounts required, together with Sales Tax Revenue, for the District to meet Required Debt
Service, as and when the same shall become due and payable, and to make all other payments
which the District is required to make pursuant the Revenue Bond Resolution or Sales Tax Bond
Resolution and to make any payments required to be made on account of its Bonds as and when
the same shall become due and payable.
6.6 Insurance. The City shall acquire and maintain insurance in form and
amounts consistent with the coverage of comparable special events center facilities and
undertakings related to said facilities as contemplated by hiterlocal Agreement No. 1 and shall
name the District as an additional named insured for at least so long as any Bonds remain
10
508531825
outstanding. Such insurance may, without limitation, including self-insurance and/or pool
insurance.
6.7 Sale, Transfer or Disposition of the Special Events Center. Neither the
_.._. C;fy nor the District ivilL.sell, transfer.or_otherwise..dispose.of(cash,such.saic,.trapsLer,or otl2rr..__. .
disposition a "transfer") any interest in the real or personal properties, facilities or other part of
the Special Events Center that are owned by it, except for a transfer by the City to the District,
unless the conditions of paragraph (1) are satisfied and the transfer is consistent with one or more
of the subparagraphs of paragraph (2), as follows:
(1) The transfer(other than a transfer to the District):
(A)is carried out in a bona fide, arm's-length transaction,
(B) the City or the District, as applicable, receives from the transferee
consideration equal to the fair market value of the portion of the Special Events Center
transferred, for which purpose "fair market value" means the most probable price that a
property should bring in a competitive and open market under all conditions requisite to a
fair sale, the willing buyer and willing seller each acting prudently and knowledgeably
and
(C) the transfer is approved by ordinance of the City or by resolution of
the District,as applicable; and
(2) The City or the District in its discretion may carry out a transfer of facilities or
property owned by it that is consistent with one or more of the following:
(A) the facilities or property to be transferred are not material to the
operation of the Special Events Center, or shall have become unserviceable, inadequate,
obsolete or unfit to be used in the operation of the Special Events Center or are no longer
necessary, material or useful to the operation of the Special Events Center; or
(B) the Special Events Center Revenues received from the operation of
those facilities or property to be transferred during the twelve full calendar months before
the transfer was less than 10% of total Special Events Center Revenues received during
that same period.
The proceeds of any transfer shall be used (i) to promptly redeem, or irrevocably set aside
for the redemption of; the District's outstanding Bonds, and/or(ii)to provide for all or part of the
cost of capital improvements and/or additions to or expansions of the Special Events Center
and/or for other regional center or tourism-related facilities authorized under chapters 35.57 and
67.28 RCW, as directed by the City.
6.8 Preservation of Tax Exemption for Interest on the Tax-Exempt
Bonds. The City will take all actions necessary to prevent interest on the Tax-Exempt Bonds
from being included in gross income for federal tax purposes, and it will neither take any action
nor make or permit any use of the Special Events Center at any time while Tax-Exempt Bonds
11
50a531a2.5
are outstanding which will cause interest on the Tax-Exempt Bonds to be included in gross
income for federal income tax purposes.
6.9 Local Match Requirement. The City's contribution of approximately
_._ 1.7.5 acres of land..ivith_an..cstimatcd valuc.of$30 nn0 nn0 u.a,t}. site ..::'hicl—C— 1• 1 U••�"t5-.....-� jvv jvv u..v -1-- Vr
Center is being constructed and at least $14,400,000 of City funds and State grant proceeds
toward the cost of construction of the Special ,Events Center is expected to satisfy the
requirement of RCW 82.14.390(4) for the provision of land, cash or in-kind contributions for the
regional center from other public or private sources equal to 33% of the amount of sales and use
taxes collected and to be collected for a regional center. The City agrees to provide for any
additional contributions as may be required to satisfy RCW 82.14.390(4) so long as any Sales
Tax Bonds or Additional Sales Tax Bonds are outstanding.
Section 7. District Covenants.
7.1 Reporting Requirements. The District shall provide the City (at the
notice address set forth in Section 10.4) with a quarterly report summarizing actual financial
activity and financial expectations for the following four quarters.
7.2 Restriction on Issuance of Additional Parity Bonds. The District shall
not issue the Bonds in an aggregate principal amount in excess of$ payable from
Sales Tax Revenue, District Revenue, or both Sales Tax Revenue and District Revenue, except
as otherwise approved by the City's Finance Director. The amount, terms and conditions of the
Bonds must be as approved by the City's Finance Director. So long as the City is not in default
of its obligations under this Agreement, the District shall not (1) issue any bonds or other
obligations payable from the Sales Tax, other than the Sales Tax Bonds, without the City's prior
written approval; or (2) borrow money or incur any obligations, without the City's prior written
approval.
Section 8. Defaults.
8.1 Remedies of City on District Default. Upon the occurrence of a default
by the District in its obligations hereunder (a "District Default"), the City may proceed to
protect and enforce its rights in equity or at law, either in mandamus or for the specific
performance of any covenant or agreement contained herein, or for the enforcement of any other
appropriate legal or equitable reinedy, as the City may deem most effectual to protect and
enforce any of its lights or interests hereunder. In the event of a District Default, the City may,
without limiting any of its other remedies hereunder,require the District to redeem or defease the
Bonds. The loans made by the City pursuant to Section 3 are not subject to acceleration. The
City's obligation to make loans pursuant to Section 3 will not be affected by a District Default.
The occurrence and/or continuance of a District Default shall not relieve the City of its
obligation to make City Special Events Center Payments or City Contingent Loan Payments as
provided in this Agreement.
8.2 Remedies of District Upon City Default. Upon the occurrence of a
default by the City in its obligations to make loans to the District hereunder (a "City Default"),
the District may proceed to protect and enforce its rights in equity or at law, either in mandamus
12
50853182.5
or for the specific performance of any covenant or agreement contained herein, or for the
enforcement of any other appropriate legal or equitable remedy, as the District may deem most
effectual to protect and enforce any of its rights or interests hereunder.
8.3 No Remedy Exel3isive_ No.remedy conferred.upon or reserved to,either
party by this Agreement is intended to be exclusive of any other available remedy or remedies,
but each and every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Agreement or now or hereafter existing at law or in equity or by statute,
and either party hereto shall be free to pursue, at the same time, each and every remedy, at law or
in equity, which it may have under this Agreement, or otherwise.
8.4 No Implied Waiver. No delay or omission to exercise any right or power
accruing upon any default shall impair any such right or power or shall be construed to be a
waiver thereof, but any such right and power may be exercised from time to time and as often as
may be deemed expedient. For the exercise of any remedy,it shall not be necessary to give any
notice, other than such notice as may be expressly required herein.
Section 9. Compliance with Continuing Disclosure Requirements. To meet the
conditions of paragraph (d)(2) of United States Securities and Exchange Commission ("SEC")
Rule 15c2-12 (the "Rule"), as applicable to a participating underwriter for the Bonds, the City
undertakes for the benefit of holders of the Bonds to provide to each NRMSIR and the SID (as
those terms are defined in the Rule), the following annual financial information: (i) annual
financial statements for the City prepared (except as noted in the financial statements) in
accordance with generally accepted accounting principles applicable to the City, as such
principles may be changed froin time to time, which statements need not be audited, except,
however, that if and when audited financial statements are otherwise prepared and available to
the City they will be provided; (ii) statements of authorized, issued and outstanding general
obligation debt of the City; (iii) statements of assessed valuation of property within the City
subject to ad valorem taxation for the fiscal year; (iv) financial information and operating data of
the type provided in the City's CAFR and included in Appendix C to the Official Statement
prepared in connection with the Sales Tax Bonds and Revenue Bonds.
Such annual financial information shall be provided not later than the last day of the ninth
month after the end of each fiscal year of the City (currently, a fiscal year ending December 31),
as such fiscal year may be changed as required or permitted by State law, commencing with the
City's fiscal year ending December 31, 2008. It may be provided in a single or multiple
documents, and may be incorporated by reference to other documents that have been filed with
each NRMSIR and the SID, or, if the document incorporated by reference is a "final official
statement"with respect to obligations of the City, that has been filed with the MSRB.
The City's obligations under this undertaking shall terminate upon the legal defeasance of
all of the Bonds. In addition, the City's obligations under this undertaking shall terminate if
those provisions of the Rule which require the City to comply with this undertaking become
legally inapplicable in respect of the Bonds for any reason, as confirmed by an opinion of
nationally recognized bond counsel or other counsel familiar with federal securities laws
delivered to the City and the District, and the District provides timely notice of such termination
to each NRMSIR or the MSRB and the SID. To the extent authorized by the SEC, the City may
13
508531815
satisfy this undertaking by transmitting the required filings using http://www.diselosureusa.org
(or such other centralized dissemination agent as may be approved by the SEC).
Section 10. Miscellaneous.
10.1 Termination. This Agreement shall terminate only upon the repayment
or defeasance of all of the Bonds and the repayment of any obligations owed by the District to
the City under this Agreement,or to a credit enhancement provider.
10.2 Governing Law; Venue. This Agreement is governed by and shall be
construed in accordance with the laws of the State and shall be liberally construed to carry out
the purposes hereof. Except as otherwise required by applicable law, any legal action under this
Agreement shall be brought in the Superior Court of the State of Washington in and for King
County.
10.3 Joint Exercise of Powers; Administrator. The City's and the District's
actions and obligations under this Agreement are declared to be a joint exercise of powers,
privileges and authority under RCW 39.34.030 and RCW 67.28.120. The Board of Directors of
the District and the Kent City Council shall each designate a person to jointly administer this
Agreement. There shall be no joint board with respect to this Agreement.
10.4 Notices.. Except as otherwise provided herein, all notices, consents or
other communications required hereunder shall be in writing, delivered as follows:
To the City: Mayor
City of Kent
220 Fourth Avenue South
Kent,WA 98032
With a copy to:
Finance Director
City of Kent
220 Fourth Avenue South
Kent, WA 98032
To the District: Chair,Board of Directors
The City of Kent Special Events Center Public
Facilities District
220 Fourth Avenue South
Kent, WA 98032
With a copy to:
Finance Director
City of Kent
Ex Offrcio Treasurer of the District
14
50853182.5
220 Fourth Avenue South
Dent, WA 98032
10.5 Binding Effect. This Agreement shall inure to the benefit of and shall be
_.. - hinAina iipnn thr Cify,ana the.nigtrint and_their.gorceSmrS..._ _ . ... -. _. .. . ... ._ _. _. _
10.6 Severability. In the event any provision of this Agreement shall be held
invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate
or render mienforceable any other provision hereof.
10.7 Amendments. This Agreement may not be effectively amended,
changed, modified, altered or terminated except by an instrument in writing duly executed by the
City and the District(or their successors in title).
10.8 No Rights Created in Third Parties. The terms of this Agreement are
not intended to establish or to create any rights in any persons or entities other than the City and
the District and the respective successors and assigns of each.
10.9 Execution in Counterparts. This document may be executed in
counterparts, and all such counterparts so executed constitute one agreement binding on all the
parties notwithstanding that all the parties are not signatories to the same counterpart.
10.10 Effective Date. This Agreement shall be come effective upon its full
execution.
15
50853182.5
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LEND MONEY,
EXTEND CREDIT, OR FORBEAR FROM ENFORCING REPAYMENT
OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.
!T wlTNrc.c_WHEREOF, the City and_the District have caused this Agreement to be
executed by their duly authorized officers.
CITY OF DENT THE CITY OF KENT SPECIAL EVENTS
CENTER PUBLIC FACILITIES DISTRICT
By By
Mayor Chair
ATTEST: ATTEST:
Finance Director Treasurer
Approved as to Form: Approved as to Form:
S-1
508531825
Form Notice of Insufficiency
City of Kent VIA[FACSIMILE
220 Fourth Avenue South (with telephone
Kent, WA _98032 _ r,.n fi m2tin )1
Attention: Finance Director
Re: NOTICE OF INSUFFICIENCY
City of Kent Special Events Center Public Facilities District Bonds
[Special Events Center Revenue Bonds,2008 Taxable]
[Special Events Center Sales Tax Bonds, 2008]
The undersigned, a duly authorized officer of the City of Kent Special Events Center Public Facilities
District (the "District"), hereby certifies to the City of Kent, Washington (the "City"), with reference to
the Contingent Loan and Support Agreement (the "Agreement") dated February L_J, 2008, by and
between the City and the District,and the above-captioned bonds(the`Bonds"),that:
1. Next Debt Service Payment Date: ,20_
2. Debt Service Due: Principal $
Interest $
Total $
3. There will be insufficient money available in the [ Debt Service Fund on the date
described in clause (1)to make the debt service payments described in clause(2):
Amount expected to be on deposit in the District's [ ] Debt
Service Fund: $
Plus the City Special Events Center Payment the City is expected to
make on , 20_,pursuant to the Agreement: $
Total available for debt service $
4. Amount of the loan requested is calculated as follows:
Debt service total listed in clause (2): $
Less the amount available for debt service,as listed in clause(3): $
Loan Amount $
Pursuant to Section 3 of the Agreement, the City is requested to make a loan to the District no later than
, 20_,in the amount listed in clause(4). The City shall cause such amount to be transferred
to the District's Debt Service Fund,in United States Dollars and immediately available funds.
Any capitalized term used herein and not defined shall have the meaning assigned to such term in the
Agreement or, if not therein defined, as defined in the Bond Resolution. The individual signing below
hereby represents that he or she is an officer of the undersigned and is duly authorized to execute and
deliver this document.
Dated: 20.
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Treasurer or designee
A-1
5085M82.5
Exhibit B
Form Cancellation Notice
City of Kent VIA[FACSIMILE
22C Faurt h Avcnuc South -(with telephone
Kent, WA 98032 confirmation)]
Attention: Finance Director
Re: CANCELLATION NOTICE
City of Kent Special Events Center Public Facilities District Bonds
[Special Events Center Revenue Bonds,2008 Taxable]
[Special Events Center Sales Tax Bonds, 2008]
City of Kent Special Events Center Public Facilities District (the "District'), hereby certifies to the City
of Kent, Washington (the "City"), with reference to the Contingent Loan and Support Agreement (the
"Agreement") dated February[ 1, 2008, by and between the City and the District, and the above-
captioned bonds (the`Bonds"),that:
1. Next Debt Service Payment Date: 120
2. Debt service due: Principal $
Interest $
Total $
3. There will be sufficient money available in the r l Debt Service Fund on the date
described in clause (1)to make the debt service payments described in clause(2):
Amount expected to be on deposit in the District's Debt
Service Fund: $
Plus the City Special Events Center Payment the City is expected to
make on , 20,pursuant to the Agreement: $
Total available for debt service $
4. The District's Notice of Insufficiency and loan request delivered on , 20 is
hereby cancelled.
Pursuant to Section 3 of the Agreement, the City is requested NOT to make a loan to the District with
respect to the debt service payments described in clause (2).
Any capitalized term used herein and not defined shall have the meaning assigned to such term in the
Agreement or, if not therein defined, as defined in the [Bond Resolution]. The individual signing below
hereby represents that he or she is an officer of the undersigned and is duly authorized to execute and
deliver this document.
Dated: 20 .
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Treasurer or designee
B-1
SOBS3182.5
Exhibit C
Form of Requisition
The undersigned hereby requisitions the following amounts to be paid to the following
_......... .. . partie-s fro r.ti2e. City.of.Kent.Special Events Center Public Facrhtres.Distnct'.s SP,-6al.E ante. - ... .
Center Project Fund funded with of the proceeds of the District's Special Events Center Revenue
Bonds, 2008 Taxable and Special Events Center Sales Tax Bonds, 2008, pursuant to the
Contingent Loan and Support Agreement (the "Agreement") dated February[_], 2008, by and
between the City and the District:
1. Name and Address of person (which may be the City) to whom the payment is to be
made:
2. Amount to be paid:
3. The undersigned hereby certifies that the obligation was properly incurred and is a proper
charge against the Special Events Center Project Fund and that the amount requisitioned is due
and unpaid (or has been paid and reimbursement therefor is requested).
4. The rmdersigned further hereby certifies that the work, material or other purchased item
to which payment relates has been accomplished, delivered or installed in a manner satisfactory
to the City, and that the City has approved the disbursement requested herein. Invoices and other
materials submitted.by the supporting this requisition are included herewith.
Dated
CITY OF KENT, WASHINGTON
By:
C-1
509531B2.5
CONTINGENT LOAN AND SUPPORT AGREEMENT
REGARDING FINANCING
FOR DENT SPECIAL EVENTS CENTER
BY AND BETWEEN
THE CITY OF DENT
AND
THE CITY OF DENT SPECIAL EVENTS
CENTER PUBLIC FACILITIES DISTRICT
508531815
TABLE OF CONTENTS
Pape
Section 1. Definitions and Interpretation...................................................................................3
1.1 Definitions................................................................................................................3
1.2 Interpretation............................................................................................................5
Section 2. Effect on Interlocal Agreement No. 1......................................................................5
Section 3. Contingent Loan Agreement....................................................................................5
3.1 City Contingent Loan Commitment for Bonds........................................................5
3.2 Contingent Loan Procedures; Time and Amount of Loans.....................................6
(a) Notice of Insufficiency ................................................................................6
(b) Cancellation Notices....................................................................................6
(c) Loans............................................................................................................6
(d) Method of Notice.........................................................................................6
(e) Assumed Payment of City Special Events Center Payments.......................6
3.3 District Repayment to City for Amounts Loaned pursuant to Contingent
LoanCommitment...................................................................................................7
3.4 District Disclosure Documents................................................................................7
Section 4. Priority of Payments from Sales Tax Revenue, District Revenue ("Flow of
Funds").....................................................................................................................7
4.1 Sales Tax Revenue...................................................................................................7
4.2 Special Events Center Revenues..............................................................................8
Section 5. Deposit and Requisition of Bond Proceeds .............................................................9
Section 6. City Events Center Payments; City Responsible for Operation and
Maintenance of Special Events Center. ...................................................................9
6.1 City Events Center Payments...................................................................................9
6.2 Operation and Maintenance of Special Events Center ..........................................10
6.3 Payment of Operation and Maintenance Expenses................................................10
6.4 District Not Responsible for Operation and Maintenance of the Special
EventsCenter.........................................................................................................10
6.5 Fees, Rates and Charges for Use of Special Events Center...................................10
6.6 Insurance................................................................................................................10
6.7 Sale, Transfer or Disposition of the Special Events Center...................................11
6.8 Preservation of Tax Exemption for Interest on the Tax-Exempt Bonds................11
6.9 Local Match Requirement......................................................................................12
Section 7. District Covenants..................................................................................................12
7.1 Reporting Requirements ........................................................................................12
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Page
7.2 Restriction on Issuance of Additional Parity Bonds..............................................12
Section8. Defaults..................................................................................................................12
8.1 Remedies of City on District Default.....................................................................12
8.2 Remedies of District Upon City Default................................................................12
8.3 No Remedy Exclusive............................................................................................13
8.4 No Implied Waiver ................................................................................................13
Section 9. Compliance with Continuing Disclosure Requirements........................................13
Section10. Miscellaneous ........................................................................................................14
10.1 Termination............................................................................................................14
10.2 Governing Law; Venue..........................................................................................14
10.3 Joint Exercise of Powers; Administrator...............................................................14
10.4 Notices ...................................................................................................................14
10.5 Binding Effect........................................................................................................15
10.6 Severability............................................................................................................15
10.7 Amendments..........................................................................................................15
10.8 No Rights Created in Third Parties........................................................................15
10.9 Execution in Counterparts......................................................................................15
10.10 Effective Date ........................................................................................................15
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CONTINGENT LOAN AND SUPPORT AGREEMENT
REGARDING FINANCING
FOR I{ENT SPECIAL EVENTS CENTER
THIS CONTINGENT LOAN AND SUPPORT AGREEMENT (this "Agreement") is
dated as of the 20"' day of February, 2008, and is made by and between THE CITY OF KENT,
WASHINGTON (the "City"), and THE CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT (the "District");
RECITALS
WHEREAS, Chapter 35.57.020 of the Revised Code of Washington ("RCW") provides
that a public facilities district may acquire, construct, own, remodel, maintain, equip, repair,
finance, and operate one or more regional centers; and
WHEREAS, the City has previously determined that the acquisition and operation of
such a regional center is in the interest of the City, and by Ordinance No. 3853 passed on
August 7, 2007 (the `District Formation Ordinance"), established the District pursuant to
RCW 35.57, to assist in the design, construction, ownership, operation and/or financing of a
regional center as defined in RCW 35.57.020 as a convention, conference or special events
center, and related parking facilities, serving a regional population (the "Special Events
Center"); and
WHEREAS, the Washington Interlocal Cooperation Act (RCW 39.34) authorizes a
public facilities district to contract with any other public agency of the State of Washington (the
"State") to perform any governmental service, activity or undertaking which each entity is
authorized to perform; and
WHEREAS, the City and the District previously entered into an Interlocal Agreement for
Development of Special Events Center dated September 14, 2007 ("Interlocal Agreement
No. I"), pursuant to the Washington Interlocal Corporation Act in connection with the
development and operation of the Special Events Center; and
WHEREAS, pursuant to State law, the District Formation Ordinance and Interlocal
Agreement No. 1, the District is authorized to issue revenue bonds or general obligation bonds in
principal amounts approved by the City consistent with RCW 35.57,030, 35.57.090 and other
applicable provisions of state law for the purpose of providing for part of the cost of joint
development of the Special Events Center; and
WHEREAS, all such bonds of the District will be satisfied exclusively from the assets,
revenues and credit of the District except and to the extent the City expressly agrees to make a
loan to the District to provide for the payment of such obligations; and
WHEREAS, under Interlocal Agreement No. I and Resolution No. 2007-1 of the Board
of Directors of the District adopted on September 14, 2007 (the "PFD Tax Resolution"), the
District imposed the sales and use taxes authorized by RCW 35.57.040(1)(d) and
RCW 82.14.390 at the rate of 0.033% of the selling price (in the case of a sales tax) or the value
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of the article used (in the case of a use tax) (the "Sales Tax") and agreed to set aside the
proceeds of such Sales Tax to be paid to the City for the purpose of providing for part of the cost
of designing, constructing, owning and operating the Special Events Center, and/or to provide
part of the debt service on District bonds or obligations issued to provide for part of such costs;
and
WHEREAS, the City commenced construction of the Special Events Center on July 27,
2007, in satisfaction of the requirements of RCW 35.57.040(1)(d) that construction of a regional
center be commenced prior to July 1, 2008; and
WHEREAS, the City has designated and provided approximately 17.5 acres of land
owned by the City with an estimated value of $30,000,000 as the site on which the Special
Events Center is being constructed, and also is contributing at least $14,400,000 of City funds
and State grant proceeds toward the cost of construction of the Special Events Center in
satisfaction of the requirement of RCW 82.14.390(4) for the provision of land, cash or in-kind
contributions for the regional center from other public or private sources equal to 33% of the
amount of sales and use taxes collected and to be collected for a regional center; and
WHEREAS, the City has requested that the District issue (i) its Special Events Center
Sales Tax Bonds, 2008, in an original principal amount not to exceed [$ ] (the "Sales
Tax Bonds") payable from the Sales Tax Revenue and District Revenue, and (ii) its Special
Events Center Revenue Bonds, 2008 (Taxable), in an original principal amount not to exceed
[$ ] (the "Revenue Bonds") payable from District Revenue; and
WHEREAS, the District intends to issue its Sales Tax Bonds and Revenue Bonds and to
make proceeds thereof available to pay for a portion of the capital costs of the Special Events
Center; and
WHEREAS, the District has requested that the City provide credit support to the District
to permit the District to obtain financing for the capital costs of the Special Events Center at the
lowest interest rates available; and
WHEREAS, the City will own and operate or provide for the operation of the Special
Events Center and will pay operation and maintenance expenses of the Special Events Center
and collect Special Events Center Revenues, all as provided in this Agreement; and
WHEREAS, in consideration for the District's issuance of the Bonds for the construction
of the Special Events Center, the City is willing to provide credit support for the District's Sales
Tax Bonds and Revenue Bonds, and the City Council of the City by Ordinance No. 3863 has
authorized the City to enter into this contingent loan and support agreement;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter contained, the
parties hereto covenant and agree as follows.
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Section 1. Definitions and Interpretation.
1.1 Definitions. As used or referred to in this Agreement, unless the context
otherwise requires, the following terms shall have the meanings given to them in the Recitals of
this Agreement:
Agreement RCW
City Revenue Bonds
District Sales Tax
District Formation Ordinance Sales Tax Bonds
Interlocal Agreement No. 1 Special Events Center
PFD Tax Resolution State
In addition, unless the context requires otherwise, the terms defined in this section shall, for all
purposes of this Agreement, have the meanings specified herein, to be equally applicable to both
the singular and plural forms of any of the terms defined herein.
"Additional Revenue Bonds"means bonds that the District may hereafter issue pursuant
to Section 18 of Resolution [2008- ] of the District adopted February , 2008 (the"Revenue
Bond Resolution") that are secured by a lien upon the District Revenue that is equal to lien upon
the District Revenue in favor of the Revenue Bonds and Sales Tax Bonds.
"Additional Sales Tax Bonds" means bonds that the District may hereafter issue
pursuant to Section 19 of Resolution [2008-1 of the District adopted February_, 2008
(the"Sales Tax Bond Resolution") that are secured by a lien upon the Sales Tax Revenue that is
equal to the lien upon the Sales Tax Revenue in favor of the Sales Tax Bonds.
"Bonds" means the Revenue Bonds, the Sales Tax Bonds, any Additional Revenue
Bonds and any Additional Sales Tax Bonds.
"Business Day" means any day, other than a Saturday or a Sunday, on which banking
institutions are open in the State and in the states in which the principal corporate trust office of
the Trustee and any of the offices of the Bond Registrar designated from time to time by the
Bond Registrar for the transfer or exchange of Bonds are located.
"City Contingent Loan Payments" means any loan payments made by the City to the
District for Required Debt Service pursuant to the Contingent Loan and Support Agreement that
are derived from City finds other than Special Events Center Revenues.
"City Special Events Center Payments"means all payments required to be made by the
City to the District for the First through Fourth purposes listed in Section 4.2 that are derived
from and represent Special Events Center Revenues.
"Debt Service Payment Date" means any date on which principal of and/or interests on
any Bond is due and payable as provided in the applicable authorizing resolution.
. "District Revenue"means all revenue, earnings and money received by the District from
and on account of the City Special Events Center Payments and City Contingent Loan Payments.
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50853[82.5
"Fiscal Agent"means the fiscal agent of the State, initially The Bank of New York.
"Operation and Maintenance Expenses" means all reasonable expenses incurred in
causing the Special Events Center to be operated and maintained in good repair, working order
and condition, including without limitation: management fees or other payments to third parties
payable in respect of the operation of the Special Events Center; personnel costs; the cost of
ordinary maintenance and repair; utilities; supplies; food and beverage service and supply costs;
equipment purchase and lease payments; administrative expenses, including administrative
expenses of the District; the costs of advertising, marketing and business promotion; deposits,
premiums, assessments or other payments for insurance; and taxes and assessments; all as
determined in accordance with generally accepted accounting principles applicable to the City
and its operations. The term "Operation and Maintenance Expenses" does not include any
depreciation of or capital expenditure for the Special Events Center.
"Project"means the design and construction of the Special Events Center.
"Required Debt Service" means, for any calendar year, with respect to the Bonds, the
amount required to make scheduled payment of principal of (including mandatory redemption
payments with respect to Term Bonds) and interest on the Bonds in that calendar year.
"Revenue Bond Insurance Policy" shall mean any bond insurance policy or credit
facility issued by a Revenue Bond Insurer insuring the payment when due of the principal of and
interest on the Revenue Bonds or any Additional Revenue Bonds, as provided therein.
"Revenue Bond Insurer" shall mean, any bond insurer or credit provider (other than the
City) undertaking to insure or provide credit support for the Revenue Bonds or any series of
Additional Revenue Bonds, and designated as such in the applicable authorizing resolution.
"Sales Tax Bond Insurance Policy" shall mean any bond insurance policy or credit
facility issued by a Sales Tax Bond Insurer insuring the payment when due of the principal of
and interest on the Sales Tax Bonds or any Additional Sales Tax Bonds, as provided therein.
"Sales Tax Bond Insurer" shall mean, any bond insurer or credit provider (other than
the City) undertaking to insure or provide credit support for the Sales Tax Bonds or any series of
Additional Sales Tax Bonds, and designated as such in the applicable authorizing resolution.
"Sales Tax Revenue"means all the money received by the District from the Washington
State Department of Revenue on account of the Sales Tax imposed by and collected for the
District.
"Special Events Center Revenues" means all revenue, earnings and money received by
the City from or on account of the operation and/or ownership of the Special Events Center,
including but not limited to license fees received by the City from Thunderbird Hockey
Enterprises, LLC (the "Team") pursuant to the License Agreement dated August 7, 2007 (the
"License Agreement'), by and between the City and the Team, facility fees, concession
revenues, advertising revenues, suite license revenues, club seat revenues, parking revenues and
naming rights revenues.
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"Tax-Exempt Bonds" means the Sales Tax Bonds and any Additional Sales Tax Bonds
and Additional Revenue Bonds the interest on which is excludable from the gross income of the
holders thereof for federal income tax purposes.
"Term Bonds" means all Bonds designated as such in the applicable authorizing
resolution.
1.2 Interpretation. Unless otherwise clear from the context of the terms,
words or phrases, the following principles govern the interpretation of terms, words and phrases
used in this Agreement:
(a) Sections, paragraphs and clauses mentioned by number only
without reference to another document are those so numbered that are contained in this
Agreement.
(b) Captions, titles or headings preceding any article, section or
subsection herein, and any table of contents or index attached hereto, are solely for convenience
of reference and are not part of this Agreement and shall not affect its meaning, construction or
effect.
(c) Terms such as "herein," "hereunder," "hereby," "hereto" and
"hereof' refer to this Agreement as a whole and not to any particular section hereof unless so
indicated; "heretofore" and"hereafter" mean before and after the date of this Agreement.
(d) Words importing any gender include masculine, feminine and
neuter genders, where applicable.
(e) Words importing the singular number include the plural number,
and vice versa, where applicable.
Section 2. Effect on Interlocal Agreement No. 1. This Agreement shall supplement
and supersede the provisions of Interlocal Agreement No. 1 to the extent of any inconsistency
between this Agreement and Interlocal Agreement No. 1. Except to the extent supplemented or
superseded by this Agreement, all obligations of the City and the District set forth in Interlocal
Agreement No. 1 shall remain in full force and effect.
Section 3. Contingent Loan Agreement.
3.1 City Contingent Loan Commitment for Bonds. In the event that the
District is unable to timely provide for the payment of principal of or interest on any Bonds, the
City shall loan to the District the amount necessary to make such timely payment. The District
agrees to borrow the amounts described above from the City pursuant to this Agreement and to
apply those amounts immediately for the purpose of meeting its obligations with respect to the
Bonds. The District shall transfer the proceeds of each City loan directly to the Fiscal Agent to
be applied to the payment of debt service on the Bonds. The City on behalf of the District may
transfer those loan amounts directly to the Fiscal Agent. The total amount of funds to be loaned
by the City pursuant to this Section 3 shall not exceed the principal amount of and interest on
the Bonds. The obligation of the City to advance funds to the District in the amounts, at the
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times and in the manner described herein shall be absohrte and unconditional, and shall not be
subject to diminution by setoff, counterclaim, abatement or otherwise. The full faith, credit and
resources of the City are pledged irrevocably for the payment to the Fiscal Agent of the amounts
described herein.
3.2 Contingent Loan Procedures; Time and Amount of Loans.
(a) Notice of Insufficiency. On the 15`h day of the month preceding
each Debt Service Payment Date (or if the 15`h is not a Business Day, then the next Business
Day), the District shall review the amount on deposit in the District's Revenue Bond Debt
Service Fund and/or the District's Sales Tax Bond Debt Service Fund, as applicable, to
determine whether there will be sufficient money available in the applicable Debt Service Fund
to make the required payment due on the upcoming Debt Service payment Date. If, upon such
review, it appears that the money available in the applicable Debt Service Fund will be
insufficient to make that payment, the District shall provide the City a notice in substantially the
form attached hereto as Exhibit A (a"Notice of Insufficiency") within five days after the date on
which the review was required. Failure of the District to give a Notice of Insufficiency to the
City shall not relieve the City of its obligation to make loans upon demand by the District.
(b) Cancellation Notices. If, at any time before 10 a.m. (Pacific Time)
on the 24`11 day of the month preceding an upcoming Debt Service Payment Date for which the
District has given a Notice of Insufficiency (or, if the 24`h is not a Business Day, the Business
Day preceding the 24"h), the District determines that there will be sufficient money available in
the applicable Debt Service Fund to make the required payment due on the upcoming Debt
Service Payment Date, the District shall provide, prior to 5 p.m. (Pacific Time) on the same day,
a notice to the City in substantially the form attached hereto as Exhibit B (a "Cancellation
Notice"). Delivery of a Cancellation Notice by the District to the City shall not relieve the City
of its obligations to make loans upon demand by the District.
(c) Loans. For so long as any Bonds remain outstanding, the City
shall, no later than 10 a.m. (Pacific Time) on the Business Day preceding a Debt Service
Payment Date, lend to the District an amount that, when added to the money available in the
applicable Debt Service Fund, is sufficient to make all payments of principal of and interests on
the Bonds due on the upcoming Debt Service Payment Date. The City shall cause the amount of
each loan hereunder to be transferred to the District in United States Dollars and immediately
available fiords.
(d) Method of Notice. Notices of Insufficiency and Cancellation
Notices shall be sent by the District to the Finance Director of the City on the day on which it is
to be given by messenger or telecopy or other electronic means capable of producing a written
notice.
(e) Assruned Payment of City Special Events Center Payments.
Solely for the purpose of determining whether sufficient money will be available in the
applicable Debt Service Fund on any Debt Service Payment Date, the parties may assume that
the City will make City Special Events Center Payments to the District at the times, and in the
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amounts, required by this Agreement, except to the extent the City has otherwise notified the
District.
3.3 District Repayment to City for Amounts Loaned pursuant to
Contingent Loan Commitment. If the City lends money to the District pursuant to this
Section 3, the District shall repay the principal amount or amounts loaned as revenues for that
purpose become available consistent with Section 4,below, and the outstanding principal amount
of any such loan shall bear interest at a rate set by the City's Finance Director on the date a loan
is made, based on the then-current yield of the City's pooled investments. The rate of interest on
the outstanding principal amount of any loan made by the City pursuant to this Agreement shall
be revised each year during the budget process based on the then-current yield of the City's
pooled investments, and effective on the same date that the City's interfund loan interest rate is
adjusted for all City mterfind loans.
3.4 District Disclosure Documents. The District may, in disclosure
documents related to the Bonds, describe or attach a form of this Agreement. However, those
disclosure documents shall contain a statement to the effect that the Bonds are payable solely
from the specified sources and other money of the District legally available therefor, and from
the transfer of the funds by the City to the District or the Fiscal Agent, but that the Bonds are not
obligations of the City. The City acknowledges that the District will pledge District Revenue to
the payment of the Bonds. The parties to this Agreement acknowledge that lenders to the
District, including Bond owners, will rely on the terms of this Agreement, including the pledge
by the City to make the advances at the times and in the amounts set forth in Section 3. The City
acknowledges that its conmiitments under this Agreement constitute valid and binding
enforceable contractual obligations.
Section 4. Priority of Payments from Sales Tax Revenue, District Revenue
("Flow of Funds").
4.1 Sales Tax Revenue. For so long as any Sales Tax Bonds or Additional
Sales Tax Bonds remain outstanding, all Sales Tax Revenue shall be transferred to and deposited
into the Sales Tax Revenue Fund when and as received by the District or by the Finance Director
of the City, as ex officio Treasurer of the District. Sales Tax Revenue deposited therein, together
City Special Events Center Payments to the extent necessary to provide for the First through
Fourth purposes below, and together with City Contingent Loan Payment to the extent necessary
to provide for the First through Third purposes below, on the third Business Day prior to each
Debt Service Payment Date shall be disbursed for the following purposes in the following order
of priority:
First, to make the required deposits to the Sales Tax Bond Debt Service Fund
for the payment of interest due on the Sales Tax Bonds and any Additional
Sales Tax Bonds;
Second, to make the required deposits to the Sales Tax Bond Debt Service Fund
for the payment of principal of the Sales Tax Bonds and any Additional
Sales Tax Bonds due at maturity or upon mandatory sinking fund
redemption prior to scheduled maturity;
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Third, to reimburse any Sales Tax Bond Insurer for any payments made under
any Sales Tax Bond Insurance Policy and any other amounts due and
owing to any Sales Tax Bond Insurer in respect of the Sales Tax Bonds or
any Additional Sales Tax Bonds;
Fourth, to repay principal of and interest on any loans made by the City to the
District as provided in Section 3.3 in respect of payments of principal of or
interest on the Sales Tax Bonds or any Additional Sales Tax Bonds; and
Fifth, to provide for costs of and reserves for long-term capital repairs, renewals
and replacements of the Special Events Center, and for other lawful
pinposes, in no particular order of preference and all as determined by the
City in consultation with the District.
The District and the City shall exercise due regard for the anticipated financial
requirements to be satisfied as priorities First through Third of this Section 4.1 in each calendar
year prior to authorizing or making any disbursement of money in the Special Events Center
Sales Tax Revenue Fund for the purposes identified as priority Fourth.
4.2 Special Events Center Revenues. For so long as any Bonds remain
outstanding, the City for itself and on behalf of the District shall collect Special Events Center
Revenues and shall transfer City Special Events Center Payments to the District for deposit into
the District Revenue Fund. City Special Events Center Payments deposited therein, together
with City Contingent Loan Payments as required for the First through Third purposes below, on
the third Business Day prior to each Debt Service Payment Date shall be disbursed for the
following purposes in the following order of priority:
First, to make the required deposits to the Revenue Bond Debt Service Fund for
the payment of interest due on the Revenue Bonds and any Additional
Revenue Bonds and, after taking into account Sales Tax Revenues
available to the District for the payment of interest due on the Sales Tax
Bonds and any Additional Sales Tax Bonds, to make required deposits to
the Sales Tax Bond Debt Service Fund for the payment of interest on the
Sales Tax Bonds and any Additional Sales Tax Bonds
Second, to make the required deposits into the Revenue Bond Debt Service Fund
for the payinent of principal of the Revenue Bonds and any Additional
Revenue Bonds at maturity or upon mandatory sinking fund redemption
prior to scheduled maturity and, after taking into account Sales Tax
Revenues available to the District therefor, to make required deposits to
the Sales Tax Bonds Debt Service Fund for the payment of principal of the
Sales Tax Bonds and any Additional Sales Tax Bonds at maturity or upon
mandatory sinking fund redemption prior to scheduled maturity;
Third to reimburse any Revenue Bond Insurer for any payments made under any
Revenue Bond Insurance Policy and other amounts due and owning to any
Revenue Bond Insurer in respect of the Revenue Bonds and any
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Additional Revenue Bonds and, after taking into account Sales Tax
Revenues available to the District for the payment thereof, to reimburse
any Sales Tax Bond Insurer for any payments made under any Sales Tax
Bond Insurance Policy and other amounts due and owing to any Sales Tax
Bond Insurer in respect of the Sales Tax Bonds and any Additional Sales
Tax Bonds;
Fourth, to repay principal of and interest on any loans made by the City to the
District as provided in Section 3.3 in respect payments of principal of or
interest on the Bonds; and
Fifth, to provide for costs of and reserves for long-term capital repairs, renewals
and replacement of the Special Events Center, and for other lawful
purposes, in no particular order of preference and all as determined by the
City in consultation with the District.
The District and the City shall exercise due regard for the anticipated financial
requirements to be satisfied as priorities First through Fourth of this Section 4.2 in each calendar
year prior to authorizing or making any disbursement of money in the Special Events Center
Revenue Fund for the purposes identified as priority Fifth. Any amounts received by the City or
the District as governmental grants or private contributions for the Special Events Center shall be
deposited in a special capital account in the Public Facilities District Special Events Center
Revenue Fund and be used for the construction,renewal and replacement of facilities comprising
the Special Events Center, unless another use is required by the terms of any such governmental
grant or private contribution.
Section S. Deposit and Requisition of Bond Proceeds. The proceeds received by
the District from the sale and delivery of the Bonds shall be paid into applicable Account within
the Project Fund and shall be used to pay a portion of the cost of acquiring, constructing and
equipping the Special Events Center, to fiord capitalized interest on the Bonds during
construction, to [pay the premium for the Sales Tax Bond Insurance Policy/Revenue Bond
Insurance Policy], and to pay the costs of issuance and sale of the Bonds. Proceeds of the Bonds
allocated to pay the cost of acquiring, constructing and equipping the Special Events Center shall
be transferred to the City for that purpose upon receipt of a requisition from the City for the
payment of such costs in substantially the form attached hereto as Exhibit C supported by
documentation provided to the City under the City's contracts for the construction of the Special
Events Center that the City determines to be sufficient.
Section 6. City Events Center Payments; City Responsible for Operation and
Maintenance of Special Events Center.
6.1 City Events Center Payments. For so long as any Bonds remain
outstanding, the City for itself and on behalf of the District shall collect Special Events Center
Revenues and shall transfer City Special Events Center Payments to the District for deposit into
the District Revenue Fund sufficient to pay the First through Fourth purposes listed in Section
4.2. The City Special Events Center Payments shall have priority over other uses of Special
Events Center Revenues.
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6.2 Operation and Maintenance of Special Events Center. The City will
proceed with due diligence to complete the construction of the Special Events Center. At all
times from and after the completion of the Special Events Center for so long as any Bonds are
outstanding, the City, for itself and on behalf of the District, shall take all actions necessary to:
(i) operate or cause the Special Events Center to be operated properly as a "regional center" (as
that term is defined in RCW 35.57) and a "tourism-related facility (as that term is defined in
RCW 67.28) in a sound and economical manner consistent with commercially reasonable
industry practices and standards for facilities similar to the Special Events Center and in
accordance with the License Agreement, (ii) maintain or cause the Special Events Center to be
maintained in compliance with all applicable legal requirements and promptly remedy(or contest
in good faith) any violations thereof, and (iii)maintain, preserve and keep the Special Events
Center, or cause the Special Events Center to be maintained, preserved and kept, with the
appurtenances and every part and parcel thereof, in lawful order and in good repair, working
order and condition, from time to time to make or, cause to be made, all necessary and proper
repairs, replacements and renewals so that at all times the operation thereof may be properly and
advantageously conducted, and not commit or suffer any unreasonable waste with respect
thereto.
6.3 Payment of Operation and Maintenance Expenses. The City shall pay
or cause to be paid all Operation and Maintenance Expenses from Special Events Center
Revenues and other City money legally available therefor.
6.4 District Not Responsible for Operation and Maintenance of the
Special Events Center. It is understood that the District shall have no responsibility for the
operation or maintenance of the Special Events Center or for the acts of the City, its employees,
agent, users of the Special Events Center or its or their officers, directors, managers, members or
shareholders, or any party acting by, through or on behalf of any such parties. The District shall
not be responsible for payment of Operation and Maintenance Expenses.
6.5 Fees, Rates and Charges for Use of Special Events Center. From and
after the completion of the Special Events Center, subject to the terns of the License Agreement,
the City for itself and on behalf of the District shall cause fees, rates and charges to be fixed,
maintained and collected for the use of the services and facilities and all commodities sold,
furnished or supplied by or through the Special Events Center, which fees, rates and charges
shall be adj Listed'from time to time as necessary, so that (i) such fees, rates and charges will be at
optimal levels to produce total Special Events Center Revenues that will at all times be at least
sufficient to enable the City to make City Special Events Center Payments to the District in the
amounts required, together with Sales Tax Revenue, for the District to meet Required Debt
Service, as and when the same shall become due and payable, and to make all other payments
which the District is required to make pursuant the Revenue Bond Resolution or Sales Tax Bond
Resolution and to make any payments required to be made on account of its Bonds as and when
the same shall become due and payable.
6.6 Insurance. The City shall acquire and maintain insurance in form and
amounts consistent with the coverage of comparable special events center facilities and
undertakings related to said facilities as contemplated by Interlocal Agreement No. 1 and shall
name the District as an additional named insured for at least so long as any Bonds remain
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outstanding. Such insurance may, without limitation, including self-insurance and/or pool
insurance.
6.7 Sale, Transfer or Disposition of the Special Events Center. Neither the
City nor the District will sell, transfer or otherwise dispose of(each such sale, transfer or other
disposition a "transfer') any interest in the real or personal properties, facilities or other part of
the Special Events Center that are owned by it, except for a transfer by the City to the District,
unless the conditions of paragraph(1) are satisfied and the transfer is consistent with one or more
of the subparagraphs of paragraph (2), as follows:
(1) The transfer(other than a transfer to the District):
(A) is carried out in a bona fide, anu's-length transaction,
(B) the City or the District, as applicable, receives from the transferee
consideration equal to the fair market value of the portion of the Special Events Center
transferred, for which purpose "fair market value" means the most probable price that a
property should bring in a competitive and open market under all conditions requisite to a
fair sale, the willing buyer and willing seller each acting prudently and knowledgeably
and
(C) the transfer is approved by ordinance of the City or by resolution of
the District, as applicable; and
(2) The City or the District in its discretion may carry out a transfer of facilities or
property owned by it that is consistent with one or more of the following:
(A) the facilities or property to be transferred are not material to the
operation of the Special Events Center, or shall have become unserviceable, inadequate,
obsolete or unfit to be used in the operation of the Special Events Center or are no longer
necessary, material or useful to the operation of the Special Events Center; or
(B) the Special Events Center Revenues received from the operation of
those facilities or property to be transferred during the twelve full calendar months before
the transfer was less than 10% of total Special Events Center Revenues received during
that same period.
The proceeds of any transfer shall be used (i) to promptly redeem, or irrevocably set aside
for the redemption of, the District's outstanding Bonds, and/or (ii) to provide for all or part of the
cost of capital improvements and/or additions to or expansions of the Special Events Center
and/or for other regional center or tourism-related facilities authorized under chapters 35.57 and
67.28 RC W, as directed by the City.
6.8 Preservation of Tax Exemption for Interest on the Tax-Exempt
Bonds. The City will take all actions necessary to prevent interest on the Tax-Exempt Bonds
from being included in gross income for federal tax purposes, and it will neither take any action
nor make or permit any use of the Special Events Center at any time while Tax-Exempt Bonds
11
508531815
are outstanding which will cause interest on the Tax-Exempt Bonds to be included in gross
income for federal income tax purposes.
6.9 Local Match Requirement. The City's contribution of approximately
17.5 acres of land with an estimated value of$30,000,000 as the site on which the Special Events
Center is being constructed and at least $14,400,000 of City funds and State grant proceeds
toward the cost of construction of the Special Events Center is expected to satisfy the
requirement of RCW 82.14.390(4) for the provision of land, cash or in-kind contributions for the
regional center from other public or private sources equal to 33% of the amount of sales and use
taxes collected and to be collected for a regional center. The City agrees to provide for any
additional contributions as may be required to satisfy RCW 82.14.390(4) so long as any Sales
Tax Bonds or Additional Sales Tax Bonds are outstanding.
Section 7. District Covenants.
7.1 Reporting Requirements. The District shall provide the City (at the
notice address set forth in Section 10.4) with a quarterly report summarizing actual financial
activity and financial expectations for the following four quarters.
7.2 Restriction on Issuance of Additional Parity Bonds. The District shall
not issue the Bonds in an aggregate principal amount in excess of$ payable from
Sales Tax Revenue, District Revenue, or both Sales Tax Revenue and District Revenue, except
as otherwise approved by the City's Finance Director. The amount, terms and conditions of the
Bonds must be as approved by the City's Finance Director. So long as the City is not in default
of its obligations under this Agreement, the District shall not (1) issue any bonds or other
obligations payable from the Sales Tax, other than the Sales Tax Bonds, without the City's prior
written approval; or (2) borrow money or incur any obligations, without the City's prior written
approval.
Section 8. Defaults.
8.1 Remedies of City on District Default. Upon the occurrence of a default
by the District in its obligations hereunder (a "District Default"), the City may proceed to
protect and enforce its rights in equity or at law, either in mandamus or for the specific
performance of any covenant or agreement contained herein, or for the enforcement of any other
appropriate legal or equitable remedy, as the City may deem most effectual to protect and
enforce any of its rights or interests hereunder. In the event of a District Default, the City may,
without limiting any of its other remedies hereunder,require the District to redeem or defease the
Bonds. The loans made by the City pursuant to Section 3 are not subject to acceleration. The
City's obligation to make loans pursuant to Section 3 will not be affected by a District Default.
The occurrence and/or continuance of a District Default shall not relieve the City of its
obligation to make City Special Events Center Payments or City Contingent Loan Payments as
provided in this Agreement.
8.2 Remedies of District Upon City Default. Upon the occurrence of a
default by the City in its obligations to make loans to the District hereunder (a "City Default"),
the District may proceed to protect and enforce its rights in equity or at law, either in mandamus
12
50853182.5
or for the specific performance of any covenant or agreement contained herein, or for the
enforcement of any other appropriate legal or equitable remedy, as the District may deem most
effectual to protect and enforce any of its rights or interests hereunder.
8.3 No Remedy Exclusive. No remedy conferred upon or reserved to either
party by this Agreement is intended to be exclusive of any other available remedy or remedies,
but each and every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Agreement or now or hereafter existing at law or in equity or by statute,
and either party hereto shall be free to pursue, at the same time, each and every remedy, at law or
in equity, which it may have tinder this Agreement, or otherwise.
8.4 No Implied Waiver. No delay or omission to exercise any right or power
accruing upon any default shall impair any such right or power or shall be construed to be a
waiver thereof, but any such right and power may be exercised from time to time and as often as
may be deemed expedient. For the exercise of any remedy, it shall not be necessary to give any
notice, other than such notice as may be expressly required herein.
Section 9. Compliance with Continuing Disclosure Requirements. To meet the
conditions of paragraph (d)(2) of United States Securities and Exchange Commission ("SEC")
Rule 15c2-12 (the "Rule"), as applicable to a participating underwriter for the Bonds, the City
undertakes for the benefit of holders of the Bonds to provide to each NRMSIR and the SID (as
those terms are defined in the Rule), the following annual financial information: (i) annual
financial statements for the City prepared (except as noted in the financial statements) in
accordance with generally accepted accounting principles applicable to the City, as such
principles may be changed from time to time, which statements need not be audited, except,
however, that if and when audited financial statements are otherwise prepared and available to
the City they will be provided; (ii) statements of authorized, issued and outstanding general
obligation debt of the City; (iii) statements of assessed valuation of property within the City
subject to ad valorem taxation for the fiscal year; (iv) financial information and operating data of
the type provided in the City's CAER and included in Appendix C to the Official Statement
prepared in connection with the Sales Tax Bonds and Revenue Bonds.
Such annual financial information shall be provided not later than the last day of the ninth
month after the end of each fiscal year of the City(currently, a fiscal year ending December 31),
as such fiscal year may be changed as required or permitted by State law, commencing with the
City's fiscal year ending December 31, 2008. It may be provided in a single or multiple
documents, and may be incorporated by reference to other documents that have been filed with
each NRMSIR and the SID, or, if the document incorporated by reference is a "final official
statement"with respect to obligations of the City, that has been filed with the MSRB.
The City's obligations under this undertaking shall terminate upon the legal defeasance of
all of the Bonds. In addition, the City's obligations under this undertaking shall terminate if
those provisions of the Rule which require the City to comply with this undertaking become
legally inapplicable in respect of the Bonds for any reason, as confirmed by an opinion of
nationally recognized bond counsel or other counsel familiar with federal securities laws
delivered to the City and the District, and the District provides timely notice of such termination
to each NRMSIR or the MSRB and the SID. To the extent authorized by the SEC, the City may
13
50851182.5
satisfy this undertaking by transmitting the required filings using http://www.disclosureusa.org
(or such other centralized dissemination agent as may be approved by the SEC).
Section 10. Miscellaneous.
10.1 Termination. This Agreement shall terminate only upon the repayment
or defeasance of all of the Bonds and the repayment of any obligations owed by the District to
the City under this Agreement, or to a credit enhancement provider.
10.2 Governing Law; Venue. This Agreement is governed by and shall be
construed in accordance with the laws of the State and shall be liberally construed to carry out
the purposes hereof. Except as otherwise required by applicable law, any legal action under this
Agreement shall be brought in the Superior Court of the State of Washington in and for Ding
County.
10.3 Joint Exercise of Powers; Administrator. The City's and the District's
actions and obligations under this Agreement are declared to be a joint exercise of powers,
privileges and authority under RCW 39.34.030 and RCW 67.28.120. The Board of Directors of
the District and the Dent City Council shall each designate a person to jointly administer this
Agreement. There shall be no joint board with respect to this Agreement.
10.4 Notices. Except as otherwise provided herein, all notices, consents or
other communications required hereunder shall be in writing, delivered as follows:
To the City: Mayor
City of Dent
220 Fourth Avenue South
Dent, WA 98032
With a copy to:
Finance Director
City of Dent
220 Fourth Avenue South
Dent, WA 98032
To the District: Chair, Board of Directors
The City of Dent Special Events Center Public
Facilities District
220 Fourth Avenue South
Dent, WA 98032
With a copy to:
Finance Director
City of Kent
Ex Officio Treasurer of the District
14
50853182.5
220 Fourth Avenue South
Dent, WA 98032
10.5 Binding Effect. This Agreement shall inure to the benefit of and shall be
binding upon the City and the District and their successors.
10.6 Severability. In the event any provision of this Agreement shall be held
invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate
or render unenforceable any other provision hereof.
10.7 Amendments. This Agreement may not be effectively amended,
changed, modified, altered or terminated except by an instrument in writing duly executed by the
City and the District (or their successors in title).
10.8 No Rights Created in Third Parties. The terms of this Agreement are
not intended to establish or to create any rights in any persons or entities other than the City and
the District and the respective successors and assigns of each.
10.9 Execution in Counterparts. This document may be executed in
counterparts, and all such counterparts so executed constitute one agreement binding on all the
parties notwithstanding that all the parties are not signatories to the same counterpart.
10.10 Effective Date. This Agreement shall be come effective upon its full
execution.
15
50853182,5
ORAL AGREEMENTS OR ORAL COMMITMENTS TO LEND MONEY,
EXTEND CREDIT, OR FORBEAR FROM ENFORCING REPAYMENT
OF A DEBT ARE NOT ENFORCEABLE UNDER WASHINGTON LAW.
IN WITNESS WHEREOF, the City and the District have caused this Agreement to be
executed by their duly authorized officers.
CITY OF KENT THE CITY OF ICENT SPECIAL EVENTS
CENTER PUBLIC FACILITIES DISTRICT
By By
Mayor Chair
ATTEST: ATTEST:
Finance Director Treasurer
Approved as to Form: Approved as to Form:
S-1
50853182.5
Form Notice of Insufficiency
City of Kent VIA [FACSIMILE
220 Fourth Avenue South (with telephone
Kent,WA 98032 confirmation)]
Attention: Finance Director
Re: NOTICE OF INSUFFICIENCY
City of Kent Special Events Center Public Facilities District Bonds
[Special Events Center Revenue Bonds, 2008 Taxable]
[Special Events Center Sales Tax Bonds,2008]
The undersigned, a duly authorized officer of the City of Kent Special Events Center Public Facilities
District (the "District"), hereby certifies to the City of Kent, Washington (the "City"), with reference to
the Contingent Loan and Support Agreement (the "Agreement") dated February[_, 2008, by and
between the City and the District, and the above-captioned bonds(the"Bonds"),that:
1. Next Debt Service Payment Date: 20
2. Debt Service Due: Principal $
Interest $
Total $
3. There will be insufficient money available in the [ 1 Debt Service Fund on the date
described in clause (1) to make the debt service payments described in clause(2):
Amount expected to be on deposit in the District's [ 1 Debt
Service Fund: $
Plus the City Special Events Center Payment the City is expected to
make on ,20 ,pursuant to the Agreement: $
Total available for debt service $
4. Amount of the loan requested is calculated as follows:
Debt service total listed in clause(2): $
Less the amount available for debt service, as listed in clause (3): $
Loan Amount $
Pursuant to Section 3 of the Agreement, the City is requested to make a loan to the District no later than
, 20 ,in the amount listed in clause (4).The City shall cause such amount to be transferred
to the District's Debt Service Fund,in United States Dollars and immediately available funds.
Any capitalized term used herein and not defined shall have the meaning assigned to such term in the
Agreement or, if not therein defined, as defined in the Bond Resolution. The individual signing below
hereby represents that he or she is an officer of the undersigned and is duly authorized to execute and
deliver this document.
Dated: 20 .
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Treasurer or designee
A-1
5085318/5
Exhibit B
Form Cancellation Notice
City of Kent VIA [FACSIMILE
220 Fourth Avenue South (with telephone
Kent, WA 98032 confirmation)]
Attention: Finance Director
Re: CANCELLATION NOTICE
City of Kent Special Events Center Public Facilities District Bonds
[Special Events Center Revenue Bonds, 2008 Taxable]
[Special Events Center Sales Tax Bonds, 2008]
City of Kent Special Events Center Public Facilities District (the "District"), hereby certifies to the City
of Kent, Washington (the "City"), with reference to the Contingent Loan and Support Agreement (the
"Agreement") dated February L], 2008, by and between the City and the District, and the above-
captioned bonds (the"Bonds"),that:
1. Next Debt Service Payment Date: 20
2. Debt service due: Principal $
Interest $
Total $
3. There will be sufficient money available in the [ Debt Service Fund on the date
described in clause (1)to make the debt service payments described in clause(2):
Amount expected to be on deposit in the District's Debt
Service Fund: $
Plus the City Special Events Center Payment the City is expected to
make on , 20 ,pursuant to the Agreement: $
Total available for debt service $
4. The District's Notice of Insufficiency and loan request delivered on 20_ is
hereby cancelled.
Pursuant to Section 3 of the Agreement, the City is requested NOT to make a loan to the District with
respect to the debt service payments described in clause (2).
Any capitalized terns used herein and not defined shall have the meaning assigned to such term in the
Agreement or, if not therein defined, as defined in the [Bond Resolution]. The individual signing below
hereby represents that he or she is an officer of the undersigned and is duly authorized to execute and
deliver this document.
Dated: , 20 .
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Treasurer or designee
B-1
508531815
Exhibit C
Form of Requisition
The undersigned hereby requisitions the following amounts to be paid to the following
parties from the City of Dent Special Events Center Public Facilities District's Special Events
Center Project Fund funded with of the proceeds of the District's Special Events Center Revenue
Bonds, 2008 Taxable and Special Events Center Sales Tax Bonds, 2008, pursuant to the
Contingent Loan and Support Agreement (thc "Agreement") dated February[_], 2008, by and
between the City and the District:
1. Name and Address of person (which may be the City) to whom the payment is to be
made:
2. Amount to be paid:
3. The undersigned hereby certifies that the obligation was properly incurred and is a proper
charge against the Special Events Center Project Fund and that the amount requisitioned is due
and unpaid (or has been paid and reimbursement therefor is requested).
4. The undersigned further hereby certifies that the work, material or other purchased item
to which payment relates has been accomplished, delivered or installed in a manner satisfactory
to the City, and that the City has approved the disbursement requested herein. Invoices and other
materials submitted by the supporting this requisition are included herewith.
Dated
CITY OF DENT, WASHINGTON
By:
C-1
50953182.5
FP 02/14/2008
CITY OF DENT SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT
RESOLUTION NO. 2008-2
A RESOLUTION of the City of Kent Special Events Center Public
Facilities District providing for the issuance of$[ ] aggregate principal
amount of Special Events Center Sales Tax Bonds, 2008, of the District to
provide funds with which to pay a portion of the cost of acquiring, constructing
and equipping a regional center; fixing the date, form, maturities, interest rates,
teens and covenants of the bonds; establishing a debt service fund and a public
facilities district sales tax revenue fund; [providing for insurance]; and approving
the sale and providing for the delivery of the bonds to Piper Jaffray & Co.,
Lehman Brothers hie. and Wachovia Securities Inc.
ADOPTED: February 20, 2008
This document prepared by:
FOSTER PEPPER PLLC
I I II Third Avenue, Suite 3400
Seattle, Washington 98101
(206) 447-4400
508557207
TABLE OF CONTENTS
Section1. Definitions....................................................................................................................2
Section 2. Authorization of Bonds. ...............................................................................................6
Section 3. Description of Bonds....................................................................................................6
Section 4. Registration and Transfer of Bonds..............................................................................7
Section5. Payment of Bonds. .......................................................................................................8
Section 6. Redemption Provisions and Purchase for Cancellation of Bonds................................8
Section7. Notice of Redemption. .................................................................................................9
Section 8. Failure to Redeem Bonds. ..........................................................................................10
Section 9. Form and Execution of Bonds....................................................................................10
Section10. Bond Registrar............................................................................................................I I
Section 11. Preservation of Tax Exemption for Interest on Bonds...............................................I I
Section 12. Refunding or Defeasance of the Bonds......................................................................12
Section 13. Pledges of Full Faith and Credit, Sales Tax Revenue and District Revenue. ............13
Section 14. Creation of Funds and Accounts. ...............................................................................13
Section 15. Sales Tax Revenue Fund; District Revenue Fund......................................................13
Section16. Debt Service Fund......................................................................................................14
Section 17. Deposit of Bond Proceeds. .........................................................................................14
Section 18. Additional Covenants.................................................................................................15
Section 19. Additional Sales Tax Bonds.......................................................................................17
Section 20. Supplements and Amendments. .................................................................................18
Section 21. Defaults and Remedies...............................................................................................19
Section 22. Approval of Bond Purchase Contract.........................................................................21
Section 23. Preliminary Official Statement Deemed Final. ..........................................................21
Section 24. Undertaking to Provide Continuing Disclosure. ........................................................21
[OMIT THE FOLLOWING TWO SECTIONS IF NO BOND INSURANCE OR UPDATEIF THERE IS BOND:INSURANCE]
Section25. Bond Insurance .........................................................................................................24
Section 26. Payment Procedures Under 2008 Bond Insurance Policy..........................................25
Section 27. Parties Interested Herein ............................................................................................25
i
50855]20)
CITY OF DENT SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT
RESOLUTION NO. 2008-2
A RESOLUTION of the City of Dent Special Events Center Public
Facilities District providing for the issuance of$[ ] aggregate principal
amount of Special Events Center Sales Tax Bonds, 2008, of the District to
provide funds with which to pay a portion of the cost of acquiring, constructing
and equipping a regional center; fixing the date, form, maturities, interest rates,
terms and covenants of the bonds; establishing a debt service fund and a public
facilities district sales tax revenue fund; [providing for insurance]; and approving
the sale and providing for the delivery of the bonds to Piper Jaffray & Co.,
Lebman Brothers Inc. and Wachovia Securities Inc.
WHEREAS, the City of Kent Special Events Center Public Facilities District (the
"District"), is a duly organized and legally existing municipal corporation of the State of
Washington formed by the City of Kent, Washington(the "City"); and
WHEREAS, the District is authorized by chapter 35.57 RCW to acquire, construct, own,
remodel, maintain, equip, repair, finance and operate "regional centers;" and
WHEREAS, the District's Board of Directors (the "Board") finds and determines that the
residents of the District and the region will benefit from the District's financing of the
acquisition and construction of an approximately 153,000 square foot regional center comprised
of a multi-purpose arena for hockey and other public uses, together with related parking facilities
(collectively, the"Special Events Center"); and
WHEREAS, the District has entered into an Interlocal Agreement for Development of
Special Events Center with the City of Kent, Washington (the "City"), regarding the design,
development, acquisition, constriction, operation and management of the Special Events Center;
and
WHEREAS, the District is authorized by RCW 35.57.030 to issue general obligation
bonds not to exceed an amount, together with any outstanding nonvoter-approved general
obligation indebtedness, equal to one-half of one percent of the value of the taxable property
within the District for the purpose of financing the Special Events Center; and
WHEREAS, the assessed valuation of the taxable property within the District as
ascertained by the last preceding assessment for District purposes for the calendar year 2008 is
$11,516,613,699, and the District has no outstanding general indebtedness evidenced by
nonvoter-approved obligations, including bonds, notes, financing leases and conditional sales
contracts, incurred within the limit of up to one-half of one percent of the value of the taxable
property within the District permitted for general District purposes without a vote of the qualified
voters therein; and
WHEREAS, the District, as authorized by RCW 35.57.040(1)(d) and RCW 82.14.390, has
imposed and has commenced collecting a 0.033% sales and use tax (the "Sales Tax") to assist in
508557203
financing the design, development, acquisition, construction, operation and management of the
Special Events Center; and
WHEREAS, the City commenced construction of the Special Events Center on July 27,
2007, in satisfaction of the requirement of RCW 35.57.040(1)(d) that construction of a regional
center be commenced prior to July 1,2008; and
WHEREAS, the City has designated and provided approximately 17.5 acres of land owned
by the City with an estimated value of$30,000,000 as the site on which the Special Events Center is
being constricted, and also is contributing at least $14,400,000 of City funds and State grant
proceeds toward the cost of construction of the Special Events Center in satisfaction of the
requirement of RCW 82.14.390(4) for the provision of land, cash or in-kind contributions for the
regional center from other public or private sources equal to 33% of the amount of sales and use
taxes collected for a regional center; and
WHEREAS, the Board now desires to provide for the issuance of the sales tax bonds
authorized herein within the limit of up to one-half of one percent of the value of the taxable
property within the District to provide a portion of the long-term financing for the acquisition,
construction and equipping of the Special Events Center; and
WHEREAS, the District and the City have entered into a Contingent Loan and Support
Agreement(defined herein)pursuant to which, among other things,in consideration of the District's
issuance of the bonds authorized herein to finance and provide the Special Events Center,the City is
obligated: to transfer Special Events Center Revenues (defined herein) to the District in amounts
sufficient, together with available Sales Tax Revenue (defined herein), to pay the debt service on the
bonds authorized herein; to lend City finds to the District to pay the debt service on the bonds
authorized herein in the event District Sales Tax Revenue and Special Events Center Revenues are
not sufficient for that purpose; and to pay all operation and maintenance expenses of the Special
Events Center from remaining Special Events Center Revenues and other City funds; and
[WHEREAS, [Name of 2008 Bond Insurer], a [State]-domiciled [description of company]
(the "2008 Bond Insurer"), has made a commitment to issue an insurance policy(the "2008 Bond
Insurance Policy") insuring the payment when due of the principal of and interest on the Bonds
as provided therein, and the Board deems that the purchase of the 2008 Bond Insurance Policy is
in the best interest of the District; and] [Update and revise if there is to be bond insurance
otherwise delete this paragraph]
WHEREAS, Piper Jaffiay & Co., Lehman Brothers Inc. and Wachovia Securities Inc.
(collectively, the "Purchaser"), 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 DIRECTORS OF THE CITY OF DENT
SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT, as follows:
Section 1. Definitions. The words and phrases set forth herein with initial capitalization
shall have the respective meanings ascribed to such words and phrases in the recitals hereto and
in this Section 1, unless the context clearly requires otherwise.
-2-
50855]20.0
"Additional Revenue Bonds" shall mean any bonds or other obligations that the District
may hereafter issue pursuant to Section 18 of the Revenue Bond Resolution that are secured by a
pledge of the District Revenue.
"Additional Sales Tax Bonds" shall mean any bonds or other obligations that the District
may hereafter issue pursuant to Section 19 of this resolution that are secured by a pledge of Sales
Tax Revenue and District Revenue.
"Bond Insurance Policy" shall meui any bond insurance policy or credit facility issued
by a Bond Insurer insuring the payment when due of the principal of and interest on the Bonds or
any Additional Sales Tax Bonds, as provided therein.
["2008 Bond Insurance Policy" shall mean the financial guaranty insurance policy issued
by the 2008 Bond Insurer insuring the payment when due of the principal of and interest on the
Bonds as provided therein.]
"Bond Insurer" shall mean any bond insurer or credit provider (other than the City)
undertaking to insure or provide credit support for the Bonds or any series of Additional Sales Tax
Bonds, as designated as such in the applicable authorizing resolution.
["2008 Bond Insurer" shall mean [Name of 2008 Bond Insurer], a [State]-domiciled
[description of company.]] [Delete if no 2008 Bond Insurance]
"Bond Purchase Contract" shall mean the Bond Purchase Contract dated February 20,
2008, between the District and the Purchaser, relating to the Bonds.
"Bond Register" shall mean the books or records maintained by the Bond Registrar on
which are recorded the names and addresses of the owners of each of the Bonds.
"Bond Registrar" shall mean the fiscal agent of the State of Washington (as such may be
designated by the State of Washington from time to time) acting in the capacity of registrar,
paying agent, transfer agent and authenticating agent for the Bonds.
"Bondowners' Trustee" shall have the meaning given such term in Section 21 of this
resolution.
"Bonds" shall mean the herein-authorized Special Events Center Sales Tax Bonds, 2008,
of the District, and"Bond" shall mean any of the Bonds.
"Chair" shall mean the Chair of the District, or any presiding officer of the District, or
his/her successor in functions, if any.
"City" shall mean the City of Dent, Washington, a municipal corporation of the State of
Washington.
"City Contingent Loan Payments" shall mean any loan payments made by the City to the
District for Required Debt Service pursuant to the Contingent Loan and Support Agreement that
are derived from City finds other than Special Events Center Revenues.
-3-
soassuo7
"City Special Events Center Payments" shall mean all payments required to be made by
the City to the District for Required Debt Service pursuant to the Contingent Loan and Support
Agreement that are derived from and represent Special Events Center Revenues.
"Code" shall mean the Internal Revenue Code of 1986, as amended, together with
corresponding and applicable final, temporary or proposed regulations and revenue rulings issued or
amended by the United States Treasury Department or the Internal Revenue Service, to the extent
applicable to the Bonds.
"Contingent Loan and Support Agreement" shall mean the Contingent Loan and Support
Agreement Regarding Financing for Dent Special Events Center between the City and the
District, dated as of February 20, 2008, as the same may be amended from time to time.
"Debt Service Fund" shall mean the District's Sales Tax Bond Debt Service Fund created
pursuant to Section 14 of this resolution.
"Debt Service Payment Date" shall mean any date on which the principal of and/or
interest on the Bonds is due and payable as provided in Section 3 of this resolution.
"Default" shall have the meaning given such term in Section 21 of this resolution.
"District Revenue" shall mean all revenue, earnings and money received by the District
from and on account of City Special Events Center Payments and City Contingent Loan
Payments.
"DTC" shall mean The Depository Trust Company, a limited-purpose trust company
organized under the laws of the State of New York, which will act as securities depository for the
Bonds.
"Interlocal Agreement" shall mean the Interlocal Agreement for Development of Special
Events Center between the City and the District dated September 14, 2007, as the same may be
amended from time to time
"Intergovernmental Contracts" shall mean, collectively, the Interlocal Agreement and the
Contingent Loan and Support Agreement.
"Letter of Representations" shall mean the Blanket Issuer Letter of Representations with
DTC setting forth certain understandings of the District and the Bond Registrar with respect to
DTC's services, as it may be amended from time to time.
"MSRB" shall mean the Municipal Securities Rulemaking Board.
"NRMSIR" shall mean each nationally recognized municipal securities information
repository designated by the SEC as such in accordance with its Rule 15c2-12 (but only for so
long as such designation remains in effect).
"Operation and Maintenance Expenses" shall mean all reasonable expenses incurred in
causing the Special Events Center to be operated and maintained in good repair, working order
-4-
50855J20
and condition, including without limitation: management fees or other payments to third parties
payable in respect of the operation of the Special Events Center; personnel costs; the cost of
ordinary maintenance and repair; utilities; supplies; food and beverage service and supply costs;
equipment purchase and lease payments; administrative expenses, including administrative
expenses of the District; the costs of advertising, marketing and business promotion; deposits,
premiums, assessments or other payments for insurance; and taxes and assessments; all as
determined in accordance with generally accepted accounting principles applicable to the City
and its operations. The term "Operation and Maintenance Expenses" does not include any
depreciation of or capital expenditure for the Special Events Center.
"Preliminary Official Statement" shall mean the Preliminary Official Statement dated
February 11, 2008,prepared in connection with the sale of the Bonds.
"Project Fund" shall mean the District's Special Events Center Project Fund created
pursuant to Section 13 of the Revenue Bond Resolution.
"Required Debt Service" shall mean, for any calendar year, with respect to the Bonds and
each series of Additional Sales Tax Bonds, the amount required to make scheduled payments of
principal of(including mandatory redemption payments with respect to Term Bonds) and interest
on the Bonds and such Additional Sales Tax Bonds in that calendar year.
"Revenue Bond Resolution" shall mean the District's Resolution No. 2008-[ ].
"Revenue Bonds" shall mean the District's $[ ] par amount Special Events
Center Revenue Bonds, 2008 (Taxable), and any Additional Revenue Bonds issued pursuant to
the Revenue Bond Resolution.
"Sales Tax Revenue" shall mean the money received by the District from the Washington
State Department of Revenue on account of the sales and use tax imposed by and collected for
the District pursuant to RCW 82.14.390, as the same may be amended from time to time, or any
successor statute.
"Sales Tax Revenue Fund" shall mean the Public Facilities District Sales Tax Revenue
Fund created pursuant to Section 14 of this resolution.
"SEC" shall mean the United States Securities and Exchange Commission.
"Secretary" shall mean the Secretary of the District, or other officer of the District who is
the custodian of the records of the proceedings of the Board, or his/her successor in functions, if
any.
"SID" shall mean a state information depository for the State of Washington, if any,
designated by the SEC as such in accordance with its Rule 15c2-12 (but only for so long as such
designation remains in effect).
"Special Events Center" shall mean the land, real property improvements, buildings,
facilities, fixtures, equipment, support facilities and related parldng facilities comprising a special
events center of approximately 153,000 square feet, including a 6,025-seat ice arena, as such
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50855J20.]
facilities may be expanded from time to time, located in the City and constituting a "regional
center"within the meaning of chapter 35.57 RCW.
"Special Events Center Revenues" shall mean all revenue, earnings and money received by
the City from or on account of the operation and/or ownership of the Special Events Center,
including but not limited to license fees received by the City from the Tearn, pursuant to the Team
License Agreement, facility fees, concession revenues, advertising revenues, suite license revenues,
club seat revenues, parking revenues and naming rights revenues.
"State"shall mean the State of Washington.
"Team" shall mean Thunderbird Hockey Enterprises, LLC, or its successor under the
Team License Agreement.
"Team License Agreement" shall mean the License Agreement between the City and the
Team dated August 7, 2007, as the same may be amended from time to time.
"Term Bonds" shall mean those Bonds maturing in [2033] and [2037] and all other
Additional Sales Tax Bonds designated as such in the applicable authorizing resolution.
"Treasurer" shall mean the Finance Director of the City, as ex officio Treasurer of the
District or his/her successor in functions, if any.
"Vice-Chair" shall mean the Vice-Chair of the District, or any vice-presiding officer of
the District, or his/her successor in functions, if any.
Section 2. Authorization of Bonds. The District shall borrow money on the credit of the
District and issue the Bonds evidencing that indebtedness in the aggregate principal amount of
$[ to pay a portion of the cost of acquiring, constructing and equipping the Special
Events Center, to fund interest on the Bonds through [June 1, 2009], to pay [the premium for the
2008 Bond Insurance Policy] [DELETE IF NO BOND INSURANCE], and to pay the costs of
issuance and sale of the Bonds.
Section 3. Description of Bonds. The Bonds shall be called Special Events Center Sales
Tax Bonds, 2008; shall be in the aggregate principal amount of $[ ]; shall be dated
their date of initial delivery; shall be in the denomination of $5,000 or any integral multiple
thereof within a single maturity; shall be numbered separately in the manner and with any
additional designation as the Bond Registrar deems necessary for purposes of identification; shall
bear interest (computed on the basis of a 360-day year of twelve 30-day months) payable
semiannually on each June 1 and December 1, commencing December 1, 2008, to the maturity
or earlier redemption of the Bonds; and shall mature on December 1 in years and amounts and
bear interest at the rates per ann ua as follows:
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508557zo7
Maturity Interest Maturity Interest
Years Amounts Rates Years Amounts Rates
2020 $ % 2027 $ %
2021 2028
2022 **
2023 2033
2024 **
2025 2037
2026
The Bonds are an indebtedness of the District, and the full faith, credit and resources of the
District are pledged to the payment of the principal of and interest on the Bonds, as further
described herein.
Section 4. Registration 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.
Bonds may be transferred only if endorsed in the manner provided thereon and surrendered to
the Bond Registrar. Any exchange or transfer shall be without cost to the owner or transferee.
The Bond Registrar shall not be obligated to exchange or transfer any Bond during the 15 days
preceding any principal payment or redemption date.
The Bonds initially shall be registered in the name of Cede & Co., as the nominee of
DTC. The Bonds so registered shall be held in fully immobilized form by DTC as depository in
accordance with the provisions of the Letter of Representations substantially in the form on file
with the Secretary and by this reference made a part hereof. To induce DTC to accept the Bonds
as eligible for deposit at DTC, the District approves the Letter of Representations. The Chair is
authorized and directed to execute and deliver the Letter of Representations, on behalf of the
District, to DTC on or before the date of delivery of the Bonds to the purchaser thereof and the
payment therefor, with such changes as the Chair deems to be in the best interest of the District,
and the execution and delivery of the Letter of Representations by the Chair shall evidence
irrevocably the approval of the Letter of Representations by the District. Neither the District 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 so 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
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508557zo3
nominees and 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 District or such substitute depository's successor; or (iii) to any person if the
Bonds are no longer held in immobilized form.
Upon the resignation of DTC or its successor (or any substitute depository or its
successor) from its functions as depository, or a determination by the District 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 District 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 District
determines that the Bonds are to be in certificated form, the ownership of Bonds may be
transferred to any person as provided herein and the Bonds no longer shall be held in fully
immobilized form.
Section 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 of the Bond Registrar mailed on the interest payment date to the registered
owners at the addresses appearing on the Bond Register on the 151h 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; provided that the costs of such wire transfer shall be paid by the requesting
registered owner. 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, as long as
the Bonds are registered in the name of DTC or its nominee, payment of principal of and interest
on the Bonds shall be made in the manner set forth in the Letter of Representations.
Section 6. Redemption Provisions and Purchase for Cancellation of Bonds. The District
reserves the right and option to redeem the Bonds prior to their stated maturity dates at any time
on or after June 1, 2018, as a whole or in part (within one or more maturities selected by the
District and randomly within a maturity in such manner as the Bond Registrar shall determine),
at par plus accrued interest to the date fixed for redemption.
Bonds maturing in the years [2033] and [2037] are Term Bonds and, if not redeemed
under the optional redemption provisions set forth above or purchased in the open market under
the provisions set forth below, shall be called for redemption by randomly(in such manner as the
Bond Registrar shall determine) at par plus accrued interest on December 1 in years and amounts
as follows:
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508557203
f 20331 Term Bonds
Mandatory Mandatory
Redemption Years Redemption Amounts
*Final Maturity
f2037 Term Bonds
Mandatory Mandatory
Redemption Years Redemption Amounts
*Final Maturity
If the District redeems under the optional redemption provisions, purchases in the open
market or defeases Term Bonds, the par amount of the Term Bonds so redeemed, purchased or
defeased (irrespective of their actual redemption or purchase prices) shall be credited against one
or more scheduled mandatory redemption amounts for those Term Bonds. The District shall
determine the manner in which the credit is to be allocated and shall notify the Bond Registrar in
writing of its allocation at least 60 days prior to the earliest mandatory redemption date for that
maturity of Term Bonds for which notice of redemption has not already been given.
Portions of the principal amount of any Bond, in installments of$5,000 or any integral
multiple thereof, may be redeemed. If less than all of the principal amount of any Bond is
redeemed, upon surrender of that Bond to the Bond Registrar, there shall be issued to the
registered owner, without charge therefor, a new Bond (or Bonds, at the option of the registered
owner) of the same maturity and interest rate in any of the denominations authorized by this
resolution in the aggregate principal amount remaining unredeemed.
The District further reserves the right and option to purchase any or all of the Bonds at
any time at any price acceptable to the District plus accrued interest to the date of purchase.
All Bonds purchased or redeemed under this section shall be cancelled.
Notwithstanding the foregoing, for so long as the Bonds are registered in the name of
DTC or its nominee, selection of Bonds for redemption shall be in accordance with the Letter of
Representations.
Section 7. Notice of Redemption. The District shall cause notice of any intended
redemption of Bonds to be given not less than 30 nor more than 60 days prior to the date fixed
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50855]20]
for redemption by first-class mail, postage prepaid, to the registered owner of any Bond to be
redeemed at the address appearing on the Bond Register at the time the Bond Registrar prepares
the notice, and the requirements of this sentence shall be deemed to have been fulfilled when
notice has been mailed as so provided, whether or not it is actually received by the owner of any
Bond. Interest on Bonds called for redemption shall cease to accrue on the date fixed for
redemption unless the Bond or Bonds called are not redeemed when presented pursuant to the
call. In addition, the redemption notice shall be mailed within the same period, postage prepaid,
to such other persons, [including the 2008 Bond Insurer at its principal office in New York,New
York] [CONFIRM PRINCIPAL OFFICE IF THERE IS BOND INSURANCE OR DELETE IF
THERE'S NO BOND INSURANCE], and registered securities depositories, and with such
additional information as the District shall determine, but these additional mailings shall not be a
condition precedent to the redemption of Bonds. Notwithstanding the foregoing, for so long as
the Bonds are registered in the name of DTC or its nominee, notice of redemption shall be given
in accordance with the Letter of Representations.
Section 8. Failure to Redeem Bonds. If any Bond is not redeemed when properly
presented at its maturity or call date, the District shall be obligated to pay interest on that Bond at
the same rate provided in the Bond from and after its maturity or call date 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 Debt Service Fund and the Bond has been called for payment by giving notice of that call
to the registered owner of each of those unpaid Bonds.
Section 9. Form and Execution of Bonds. The Bonds shall be printed or lithographed on
good bond paper in a form consistent with the provisions of this resolution and State law shall be
signed by the Chair and Secretary, either or both of whose signatures may be manual or in
facsimile. The Bonds need not be sealed with the corporate seal of the District.
Each Bond shall contain the following recital: "This Bond and the Bonds of this series are
an indebtedness of the District, and the interest and principal on the Bonds shall only be payable
from the Sales Tax Revenue and District Revenue pledged in the Bond Resolution to meet the
principal and interest requirements. The owner of this Bond shall not have any claim against the
District arising from this Bond except for payment fi-om the Sales Tax Revenue and District
Revenue pledged to meet the principal and interest requirements. This Bond and the Bonds are not
obligations of the City of Dent. The owner or bearer of this Bond shall not have any claim against
City of Dent in respect of this Bond except as provided under the Contingent Loan and Support
Agreement."
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509557za3
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 City of Dent Special Events
Center Public Facilities District Special Events Center Sales Tax Bonds, 2008,
described in the Bond Resolution.
WASHINGTON STATE FISCAL AGENT
Bond Registrar
By
Authorized Signer
The authorized signing of a Certificate of Authentication shall be conclusive evidence that the
Bond so authenticated has been duly executed, authenticated and delivered and is entitled to the
benefits of this resolution.
If any officer whose facsimile signature appears on the Bonds ceases to be an officer of
the District 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 District, those Bonds
nevertheless may be authenticated, issued and delivered and, when authenticated, issued and
delivered, shall be as binding on the District as though that person had continued to be an officer
of the District authorized to sign bonds. Any Bond also may be signed on behalf of the District
by any person who, on the actual date of signing of the Bond, is an officer of the District
authorized to sign bonds, although he or she did not hold the required office on the date of
issuance of the Bonds.
Section 10. Bond Reg stray. The District hereby appoints the fiscal agent of the State as
Bond Registrar. The Bond Registrar shall keep, or cause to be kept, at its principal corporate
trust office, sufficient books for the registration and transfer of the Bonds, which shall be open to
inspection by the District at all times. The Bond Registrar is authorized, on behalf of the
District, to authenticate and deliver Bonds transferred or exchanged in accordance with the
provisions of the Bonds and this resolution, to serve as the District's paying agent for the Bonds
and to carry out all of the Bond Registrar's powers and duties under this resolution.
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 District
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
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50955J20.J
make or permit any use of proceeds of the Bonds or other fiords of the District 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. The District also
covenants that it will, to the extent the arbitrage rebate requirement of Section 148 of the Code is
applicable to the Bonds, take all actions necessary to comply (or to be treated as having
complied) with that requirement in connection with the Bonds, including the calculation and
payment of any penalties that the District has elected to pay as an alternative to calculating
rebatable arbitrage, and the payment of any other penalties if required under Section 148 of the
Code to prevent interest on the Bonds from being included in gross income for federal income
tax purposes.
Section 12. Refunding or Defeasance of the Bonds. The District may issue refunding
bonds pursuant to the laws of the State or use money available from any other lawful source to
pay when due the principal of and interest on the Bonds, or any portion thereof included in a
refunding or defeasance plan, and to redeem and retire, refund or defease all such then-
outstanding Bonds (hereinafter collectively called the "defeased Bonds") and to pay the costs of
the refunding or defeasance. If money and/or "government obligations" within the meaning of
RCW 39.53.010(4) maturing at a time or times and bearing interest in amounts (together with
money, if necessary) sufficient to redeem and retire, refund or defease the defeased Bonds in
accordance with their terms are set aside in a special trust fund or escrow account irrevocably
pledged to that redemption, retirement or defeasance of defeased Bonds (hereinafter called the
"trust account'), then all right and interest of the owners of the defeased Bonds in the covenants
of this 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
District shall include in the refunding or defeasance plan such provisions as the District deems
necessary for the random selection of any defeased Bonds that constitute less than all of a
particular maturity of the Bonds, for notice of the defeasance to be given to the owners of the
defeased Bonds and to such other persons as the District shall determine, and for any required
replacement of Bond certificates for defeased Bonds. The defeased Bonds shall be deemed no
longer outstanding, and the District may apply any money in any other fiznd or account
established for the payment or redemption of the defeased Bonds to any lawful purposes as it
shall determine.
If the Bonds are registered in the name of DTC or its nominee, notice of any defeasance
of Bonds shall be given to DTC in the manner prescribed in the Letter of Representations for
notices of redemption of Bonds.
[Notwithstanding anything in this section to the contrary, if the principal of and/or
interest due on the Bonds is paid by the 2008 Bond Insurer pursuant to the 2008 Bond Insurance
Policy, the Bonds shall be treated as remaining outstanding for all purposes, not defeased or
otherwise satisfied and shall not be considered paid by the District, and the assignment and
pledge of the revenues and all other covenants, agreements and other obligations of the District
to the registered owners of the Bonds shall continue to exist and shall run to the benefit of the
2008 Bond Insurer, and the 2008 Bond Insurer shall be subrogated to the rights of those
registered owners.] [DELETE IF NO BOND INSURANCE]
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5085572U
Section 13. Pledges of Full Faith and Credit, Sales Tax Revenue and District Revenue.
The full faith and credit of the District is hereby pledged for the repayment of the Bonds, all as
provided by this resolution. The Sales Tax Revenue is hereby pledged, for the equal and ratable
benefit of the owners from time to time of the Bonds, as security for payment of the principal of
and premium, if any, and interest on the Bonds, subject to the provisions of this resolution
permitting the application of amounts held hereunder to the purposes set forth herein.
Pursuant to RCW 35.57.030(3), the District Revenue also is hereby pledged, for the equal
and ratable benefit of the owners from time to time of the Bonds, as security for payment of the
principal of and premium, if any, and interest on the Bonds, subject to the provisions of this
resolution permitting the application of amounts held hereunder to the purposes set forth herein.
Such pledge is hereby declared to be a prior lien and charge on the District Revenue superior to
all other liens and charges of any kind or nature whatsoever, except that the pledge, lien and
charge on the District Revenue shall be on a parity with the pledge, lien and charge thereon made
in Section 12 of the Revenue Bond Resolution in favor of the Revenue Bonds and, subject to the
provisions of Section 18 of the Revenue Bond Resolution and Section 19 hereof, liens on the
District Revenue may be created in favor of any Additional Revenue Bonds and Additional Sales
Tax Bonds, in each case on a parity with the pledge thereof made under this Section 13 in favor
of the Bonds.
Section 14. Creation of Funds and Accounts. The following fiends and accounts are
established and shall be maintained in the office of the Treasurer separate and distinct from all other
funds and accounts of the District: the Sales Tax Bond Debt Service Fund (the "Debt Service
Fund") and the Public Facilities District Sales Tax Revenue Fund ("Sales Tax Revenue Fund").
Pursuant to Section 13 of the Revenue Bond Resolution, the District has established the District
Revenue Fund to be maintained in the office of the Treasurer separate and distinct from all other
funds and accounts of the District.
Section 15. Sales Tax Revenue Fund; District Revenue Fimd. For so long as any Bonds
or any Additional Sales Tax Bonds remain outstanding, and unless otherwise specifically
provided herein, all Sales Tax Revenue shall be transferred to and deposited into the Sales Tax
Revenue Fund when and as received by the District or by the Finance Director of the City, as ex
officio Treasurer of the District. Sales Tax Revenue deposited therein, together with City Special
Events Center Payments to the extent necessary to provide for the First through Fourth purposes
below, and together with City Contingent Loan Payments to the extent necessary to provide for
the First through Third purposes below, shall be disbursed for the following purposes in the
following order of priority, commencing with all Sales Tax Revenue currently on hand in any
other fund or account of the District:
First, to make the required deposits into the Debt Service Fund for the payment of
interest due on the Bonds and any Additional Sales Tax Bonds (as provided in
Section 16 of this resolution);
Second, to make the required deposits into the Debt Service Fund for the payment of
principal of the Bonds and any Additional Sales Tax Bonds at maturity or upon
mandatory sinking fund redemption prior to scheduled maturity (as provided in
Section 16 of this resolution);
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50855]20]
Third, to reimburse any Bond Insurer for any payments made under any Bond
Insurance Policy and other amounts due and owing to any Bond Insurer in
respect of the Bonds and any Additional Sales Tax Bonds;
Fourth, to repay principal of and interest on any loans made by the City to the District
under Section 3 of the Contingent Loan and Support Agreement in respect of
the Bonds and any Additional Sales Tax Bonds; and
Fifth, to provide for costs of and reserves for long-term capital repairs, renewals and
replacements of the Special Events Center, and for other lawful purposes, in no
particular order of preference and all as determined by the City in consultation
with the District.
The District hereby covenants that it will exercise due regard for the anticipated financial
requirements to be satisfied as priorities First through Fourth of this Section 15 in each calendar
year prior to authorizing or malting any disbursement of money in the Sales Tax Revenue Fund
and the District Revenue Fiord for the purpose identified as priority Fifth. Money in the Sales
Tax Revenue Fund shall be invested by the Treasurer, but only upon the direction of the District,
in any legal investment for District funds, and interest earnings shall accrue to and be deposited
in the Sales Tax Revenue Fund.
Section 16. Debt Service Fund. Capitalized interest amounts required to be transferred
from the Sales Tax Bond Proceeds Account of the Project Fund shall be paid into the Debt Service
Fund. For so long as the Bonds or any Additional Sales Tax Bonds remain outstanding, the District
shall deposit (and the Treasurer is hereby directed to deposit), from the Sales Tax Revenue Fund
and the Special Events Center Revenue Fund, on or before each Debt Service Payment Date,
amounts that are sufficient, together with other money then on deposit in the Debt Service Fund, to
pay the principal of(if any) and the interest on the Bonds that is scheduled to come due on such
Debt Service Payment Date.
Section 17. Deposit of Bond Proceeds. The proceeds received by the District from the
sale and delivery of the Bonds shall be paid into the Sales Tax Bond Proceeds Account within
the Project Fund and shall be used for the purposes specified in Section 2 of this resolution.
Proceeds of the Bonds allocated to pay the cost of acquiring, constructing and equipping the
Special Events Center shall be transferred to the City for that purpose upon requisitions by the
City for payment of such costs supported by documentation provided to the City under the City's
contracts for the construction of the Special Events Center that the City determines to be
sufficient. On each Debt Service Payment Date on which interest on the Bonds is to be paid
from Bond proceeds, the Treasurer shall transfer the required amount from the Sales Tax Bond
Proceeds Account to the Debt Service Fund for that purpose. Until needed to pay the cost of
acquiring, constructing and equipping the Special Events Center, the cost of issuance and sale of
the Bonds, or interest on the Bonds, the District may invest money in the Sales Tax Bond
Proceeds Account temporarily in any legal investment, and the investment earnings may be
retained in the Sales Tax Bond Proceeds Account and be spent for the purposes of that fund,
except that earnings subject to a federal tax or rebate requirement may be withdrawn from the
Sales Tax Bond Proceeds Account and used for those tax or rebate purposes.
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509557zo 7
Section 18. Additional Covenants.
(a) Limitation on Future Pledges of Sales Tax Revenue; Liens and Encumbrances on
District Revenue. Except as otherwise allowed by Section 19 hereof, the District covenants and
agrees, for as long as any of the Bonds are outstanding, not to pledge Sales Tax Revenue or
District Revenue (except for the pledge of District Revenue for payment of the Revenue Bonds)
to any purpose other than the payment of principal of and interest on the Bonds and any
Additional Sales Tax Bonds unless such pledge is expressly subordinate to the pledge of Sales
Tax Revenue in favor of the Bonds and the Additional Sales Tax Bonds. Except as otherwise
allowed by Section 18 of the Revenue Bond Resolution, the District will not at any time create or
permit to accrue or to exist any lien or other encumbrance or indebtedness upon the District
Revenue, or any part thereof, prior or superior to the lien thereon for the payment of the Bonds and
any Additional Sales Tax Bonds, and will pay and discharge, or cause to be paid and discharged,
any and all lawful claims for labor, materials or supplies which, if unpaid, might become a lien or
charge upon the District Revenue, or any part thereof, prior to or superior to the lien of the Bonds
and any Additional Sales Tax Bonds, or which might impair the security of the Bonds and any
Additional Sales Tax Bonds.
(b) Imposition and Collection of the Sales Tax. The District hereby irrevocably
covenants and agrees for as long as any of the Bonds are outstanding that each year it will
continue to impose the Sales Tax at the rate of at least 0.033% of the selling price (in the case of
a sales tax) or value of the article used (in the case of a use tax) and to apply the Sales Tax
Revenue as provided in this resolution;provided, however, this covenant shall not extend beyond
the maximum period of time the Sales Tax may be imposed under RCW 82.14.390. The District
covenants to take no action that would cause the rate of the Sales Tax to be less than 0.033% of
the selling price (in the case of a sales tax) or value of the article used (in the case of a use tax)
for so long as any Bonds or Additional Sales Tax Bonds are outstanding. The District further
covenants to increase the rate of its Sales Tax to the full extent permitted under the provisions of
RCW 82.14.390 to mitigate any net loss in its Sales Tax collections resulting from the change in
State law effective July 1, 2008, from an origin-based collection system to a destination-based
collection system. The District shall take all reasonable measures permitted by law to enforce
payment to it of all Sales Tax Revenue, and shall at all times, to the extent permitted by law,
defend, preserve and protect the rights, benefits and privileges of the District and of the
Registered Owners under or with respect to this resolution.
(c) Authority Regarding the District Revenue. The District shall take all reasonable
measures permitted by law to enforce payment to it of all District Revenue, and shall at all times,
to the extent permitted by law, defend, preserve and protect the rights, benefits and privileges of
the District and of the Registered Owners under or with respect to this resolution.
(d) Enforcement of Obligations. The District hereby covenants and agrees that it will
perform its respective obligations and will enforce performance by the other parties thereto under
each of the Intergovernmental Contracts, and that it will not amend any Intergovernmental
Contract in a manner that adversely affects, in any material respect, the interests of the owners of
the Bonds.
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50%55720.7
(e) Operation of Special Events Center. From and after the completion of the Special
Events Center, the District shall cause the City, at the City's sole cost and expense, at all times
that any Bonds, Additional Sales Tax Bonds, Revenue Bonds or Additional Revenue Bonds are
outstanding, to operate the Special Events Center, or cause the Special Events Center to be
operated, properly as a "regional center" (as that term is defined in chapter 35.57 RCW) and as a
"tourism-related facility" (as that term is defined in chapter 67.28 RCW) and in a sound and
economical manner and shall maintain, preserve and keep the same, or cause the same to be
maintained, preserved and kept, with the appurtenances and every part and parcel thereof, in
good repair, working order and condition, and shall from time to time make, or cause to be made,
all necessary and proper repairs, replacements and renewals so that at all times the operation
thereof may be properly and advantageously conducted. The District shall cause the City to fix,
maintain and collect rates and charges for the use of the services and facilities and all
commodities sold, furnished or supplied by the Special Events Center, which shall be at optimal
levels to produce total Special Events Center Revenues that will at all times be at least sufficient
to enable the City to make City Special Events Center Payments to the District in amounts
required, together with Sales Tax Revenue, for the District to meet Required Debt Service, as
and when the same shall become due and payable, and to make all other payments which the
District is required to make pursuant to this resolution.
(1) Insurance. The District will cause the City to acquire and maintain insurance in
form and amounts consistent with the coverage of comparable special events center facilities and
undertakings related to said facilities as contemplated under the Interlocal Agreement and to name
the District as an additional named insured. Such insurance may, without limitation, include self-
insurance and/or pool insurance. Pursuant to the Interlocal Agreement, the City has agreed to use
reasonable efforts to have the District named as an additional insured if a license agreement or other
agreement with a user of the Special Events Center provides that the licensee must obtain specified
insurance and name the City as an additional insured.
(g) Sale Transfer or Disposition of the Special Events Center. Pursuant to the
Contingent Loan and Support Agreement, neither the City nor the District shall sell, transfer or
otherwise dispose of(each such sale, transfer or other disposition a "transfer") any of the real or
personal properties, facilities or other part of the Special Events Center that are owned by it, except
for a transfer by the City to the District, unless the conditions of paragraph (1) are satisfied and the
transfer is consistent with one or more of the subparagraphs of paragraph(2), as follows:
(1) None of the real or personal properties, facilities or other part of the Special
Events Center shall be transferred unless:
(A) the transfer (other than a transfer to the District) is carried out in a
bona fide, arm's-length transaction;
(B) the City or the District, as applicable, receives from the transferee
consideration equal to the fair market value of the portion of the Special Events Center
transferred, for which purpose "fair market value" means the most probable price that a
property should bring in a competitive and open market under all conditions requisite to a
fair sale, the willing buyer and willing seller each acting prudently and knowledgeably; and
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50855]207
(C) the transfer is approved by ordinance of the City or by resolution of
the District, as applicable; and
(2) The City or the District in its discretion may carry out a transfer of facilities
or property owned by it that is consistent with one or more of the following:
(A) the facilities or property to be transferred are not material to the
operation of the Special Events Center, or shall have become unserviceable, inadequate,
obsolete or unfit to be used in the operation of the Special Events Center or are no longer
necessary,material or useful to the operation of the Special Events Center; or
(B) the Special Events Center Revenues received from the operation of
those facilities or property to be transferred during the twelve full calendar months before
the transfer was less than 10% of total Special Events Center Revenues received during that
same period.
(3) The proceeds of any transfer under this Section 18(g) shall be used (i)to
promptly redeem, or irrevocably set aside for the redemption of, the District's outstanding
Bonds, Additional Sales Tax Bonds, Revenue Bonds and/or Additional Revenue Bonds,
and/or(ii)to provide for all or part of the cost of capital improvements and/or additions to or
expansions of the Special Events Center and/or for other regional center or tourism-related
facilities authorized under chapters 35.57 and 67.28 RCW, as directed by the City.
Section 19. Additional Sales Tax Bonds.
(a) Conditions upon the Issuance of Additional Sales Tax Bonds. As long as any
Bonds remain outstanding, the District hereby farther covenants and agrees that it will not issue
any obligations payable from Sales Tax Revenue, and further that it will not issue any Additional
Sales Tax Bonds, except in accordance with the conditions of this section. The District hereby
reserves the right to issue Additional Sales Tax Bonds for any lawful purpose, including for the
purposes of paying costs of completing constriction of the Special Events Center for which
Bonds have been issued previously and refunding outstanding Bonds or Additional Sales Tax
Bonds, as provided in this section. The District shall not issue any series of Additional Sales Tax
Bonds unless:
(i) the District shall not have been in Default under this resolution for the
immediately preceding 12 calendar months;
(ii) the City shall have approved the issuance of the Additional Sales Tax
Bonds and the Contingent Loan and Support Agreement shall have been amended as
necessary to accommodate the issuance of the Additional Sales Tax Bonds, including
any increase the City's contingent loan commitment thereunder required to cover the
principal of and interest on the Additional Sales Tax Bonds, which approval and
amendment shall be evidenced by a certified copy of the City's approving ordinance or
resolution and a certified copy of the executed amendment of the Contingent Loan and
Support Agreement; and
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50855t20.7
(iii) the Contingent Loan and Support Agreement is in full force and effect
between the District and the City, and the City is not in default of it obligations to the
District thereunder.
(b) Refundings to Care Pending Defaults. Nothing herein contained shall prevent the
District from issuing Additional Sales Tax Bonds to refund maturing Bonds or Additional Sales
Tax Bonds for the payment of which money is not otherwise available; provided, such
Additional Sales Tax Bonds shall not be issued more than three months prior to the Debt Service
Payment Date on which the payment default is otherwise expected to occur.
(c) Subordinate Lien Bonds. Nothing herein contained shall prevent the District (with
the consent of the City if required by the Contingent Loan and Support Agreement) from issuing
bonds or other obligations that are a charge upon the Sales Tax Revenue and District Revenue
junior or inferior to the payments required by this resolution to be made out of the Sales Tax
Revenue or District Revenue into the Debt Service Fund to pay and secure the payment of the
Bonds and any Additional Sales Tax Bonds.
Section 20. Supplements and Amendments.
(a) Without Consent of Owner. The District from time to time and at any time may
adopt a resolution or resolutions supplemental hereof, which resolution or resolutions thereafter
shall become a part of this resolution, for one or more or all of the following purposes:
(i) To add to the covenants and agreements of the District in this resolution
contained and other covenants and agreements thereafter to be observed, which shall not
adversely affect in any material respect the interests of the owners of the Bonds, or to
surrender any rights or power herein reserved to or conferred upon the District.
(ii) To cure, correct or supplement any ambiguous or defective provision
contained in this resolution in regard to matters or questions arising under the resolution
as the Board may deem necessary or desirable and not inconsistent with the resolution
and which shall not adversely affect the interest of the owner of Bonds in any material
respect.
Any such supplemental resolution of the Board may be adopted without the consent of
the owner of the Bonds at any time outstanding, notwithstanding any of the provisions of this
section.
(b) With Owner's Consent. With the consent of the owners of at least 51% in
principal amount of outstanding Bonds, the Board may adopt a resolution or resolutions
supplemental hereto for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this resolution or of any supplemental resolution; provided,
however, that no such supplemental resolution shall extend the fixed maturity of the Bonds, or
reduce the rate of interest thereon, or extend the time of payments of interest from their due date,
or reduce the amount of the principal thereof, or reduce any premium payable on the redemption
thereof without the consent of the owner of each Bond so affected.
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50855720]
It shall not be necessary for the consent of the owner under this subsection to approve the
particular form of any proposed supplemental resolution, but it shall be sufficient if such consent
shall approve the substance thereof.
(c) Effective Date of Modification. Upon the adoption of any supplemental
resolution pursuant to the provisions of this section, this resolution shall be deemed to be
modified and amended in accordance therewith, and the respective rights, duties and obligations
of the District under this resolution shall thereafter be determined, exercised and enforced
thereunder, subject in all respect to such modification and amendments, and all the terns and
conditions of any such supplemental resolution shall be deemed to be part of the terms and
conditions of this resolution for any and all purposes. A copy of each supplemental resolution
shall be provided to the owners of the Bonds.
Section 21. Defaults and Remedies. The District hereby finds and determines that the
deposit and disbursement of Sales Tax Revenue and District Revenue are essential to the
payment and security of the Bonds and the failure or refusal of the District or any of its officers
to perform the covenants and obligations of this resolution may endanger the application of Sales
Tax Revenue and District Revenue and such other money, funds and securities to the purposes
herein set forth. Accordingly, the provisions of this section are specified and adopted for the
additional protection of the owners from time to time of the Bonds. Any one or more of the
following events shall constitute a"Default"under this resolution:
(a) The District shall fail to make payment of the principal of any Bond or Additional
Sales Tax Bond when the same shall become due and payable whether by maturity or scheduled
redemption prior to maturity;
(b) The District shall fail to make payments of any installment of interest on any
Bond or Additional Sales Tax Bond when the same shall become due and payable; or
(c) The District shall default in the observance or performance of any other
covenants, conditions, or agreements on the part of the District contained in this resolution, and
such default shall have continued for a period of 90 days; provided, however, that such default
shall not constitute a Default unless the owners of at least a majority of the principal amount of
outstanding Bonds have requested a Bondowners' Trustee to declare such default as a Default.
In such case, so long as such Default shall not have been remedied, a Bondowners'
Trustee may be appointed for the Bonds by the owners of a majority in principal amount of the
Bonds of such series by an instrument or concurrent instruments in writing signed and
acknowledged by such Bondowners or by their attorneys-in-fact duly authorized and delivered to
such Trustee, notification thereof being given to the District. Any Bondowners' Trustee
appointment under the provisions of this section shall be a bank or trust company organized
under the laws of any state or a national banking association. The fees and expenses of a
Bondowners' Trustee shall be borne by the Bondowners and not by the District. The bank or
trust company acting as a Bondowners' Trustee may be removed at any time, and a successor
Bondowners' Trustee may be appointed by the owners of a majority in principal amount of the
Bonds outstanding, by an instrument or concurrent instruments in writing signed and
acknowledged by such Bondowners or by their attorneys-in-fact duly authorized. A separate
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bondowners' trustee may be retained for each subsequent issue of Additional Sales Tax Bonds;
however, the same bank may represent the owners of the Bonds and the owners of Additional
Sales Tax Bonds in the capacity as bondowners' trustee.
The Bondowners' Trustee appointed in the manner herein provided, and each successor
thereto, is hereby declared to be a trustee for the owners of all the Bonds for which such
appointment is made and is empowered to exercise all the rights and powers herein conferred on
the Bondowners' Trustee.
A Bondowners' Trustee may, upon the happening of a Default and during the
continuance thereof, take such steps and institute such suits, actions or other proceedings in its
own name, or as trustee, all as it may deem appropriate for the protection and enforcement of the
rights of Bondowners to collect any amounts due and owing the District, or to obtain other
appropriate relief, and may enforce the specific performance of any covenant, agreement or
condition contained in this resolution. Nothing contained in this section shall, in any event or
under any circumstances, be deemed to authorize the acceleration of maturity of principal of the
Bonds, and the remedy of acceleration is expressly denied to the owners of the Bonds under any
circumstances including, without limitation, upon the occurrence and continuance of a Default.
Any action, suit or other proceedings instituted by a Bondowners' Trustee hereunder
shall be brought in its name as trustee for the Bondowners and all such rights of action upon or
under any of the Bonds or the provisions of this resolution may be enforced by a Bondowners'
Trustee without the possession of any of said Bonds, and without the production of the same at
any trial or proceedings relating thereto except where otherwise required by law, and the
respective owners of said Bonds by taldng and holding the same, shall be conclusively deemed
irrevocably to appoint a Bondowners' Trustee the true and lawful trustee to the respective
owners of said Bonds, with authority to institute any such action, suit or proceeding; to receive as
trustee and deposit in trust any sums that become distributable on account of said Bonds; to
execute any paper or documents for the receipt of such money, and to do all acts with respect
thereto that the Bondowner himself might have done in person. Nothing herein contained shall
be deemed to authorize or empower any Bondowners' Trustee to consent to accept or adopt, on
behalf of any owner of said Bonds, any plan of reorganization or adjustment affecting the said
Bonds or any right of any owner thereof, or to authorize or empower the Bondowners' Trustee to
vote the claims of the owners thereof in any receivership, insolvency, liquidation, bankruptcy,
reorganization or other proceeding to which the District shall be a party.
No owner of any one or more of the Bonds shall have any right to institute any action,
suit or proceedings at law or in equity for the enforcement of the same, unless Default shall have
happened and be continuing, and unless no Bondowners' Trustee has been appointed for such
series as herein provided, but any remedy herein authorized to be exercised by a Bondowners'
Trustee may be exercised individually by any Bondowner, in his own naive and on his own
behalf or for the benefit of all Bondowners, in the event no Bondowners' Trustee has been
appointed, or with the consent of the Bondowners' Trustee if such Bondowners' Trustee has
been appointed; provided however, that nothing in this resolution or in the Bonds shall affect or
impair-the obligation of the District, which is absolute and unconditional, to pay from Sales Tax
Revenue and District Revenue the principal of and interest on said Bonds to the respective
-20-
owners thereof at the respective due dates therein specified, or affect or impair the right of
action, which is absolute and unconditional, of such owners to enforce such payments.
The remedies herein conferred upon or reserved to the owners of the Bonds and to a
Bondowners' Trustee are not intended to be exclusive of any other remedy or remedies, and each
and every such remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute. The privileges herein
granted shall be exercised from time to time and continued so long as and as often as the
occasion therefor may arise and no waiver of any default hereunder, whether by a Bondowners'
Trustee or by the owners of Bonds, shall extend to or shall affect any subsequent default or shall
impair any rights or remedies consequent thereon. No delay or omission of the Bondowners or
of a Bondowners' Trustee to exercise any right or power accruing upon any default shall impair
any such right or power or shall be construed to be a waiver of any such default or acquiescence
therein.
Upon any such waiver, such default shall cease to exist, and any Default arising
therefrom shall be deemed to have been cured, for every purpose of this resolution; but no such
waiver shall extend to any subsequent or other default or impair any right consequent thereon.
Section 22. Approval of Bond Purchase Contract. The Purchaser has presented the Bond
Purchase Contract to the District 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 Secretary and is incorporated herein by this reference. The Board finds that entering into the
Bond Purchase Contract is in the District's best interest and therefore accepts the offer contained
therein and authorizes its execution by either the Chair,the Vice-Chair or the Secretary.
The Bonds will be printed at District expense and will be delivered to the Purchaser in
accordance with the Bond Purchase Contract, together with the approving legal opinion of Foster
Pepper PLLC,regarding the Bonds.
The Chair, Vice-Chair, Secretary and Treasurer are authorized and directed to do
everything necessary for the prompt delivery of the Bonds to the Purchaser, including, without
limitation, the execution of the Official Statement on behalf of the District, and for the proper
application and use of the proceeds of the sale thereof.
Section 23. Preliminary Official Statement Deemed Final. The Board has been provided
with copies of the Preliminary Official Statement. For the sole purpose of the Purchaser's
compliance with SEC Rule 15c2-12(b)(1), the District "deems final" that Preliminary Official
Statement as of its date, except for the omission of information as to offering prices, interest
rates, selling compensation, aggregate principal amount, principal amount per maturity, maturity
dates, options of redemption, delivery dates, ratings and other terms of the Bonds dependent on
such matters.
Section 24. Undertaking to Provide Continuing Disclosure. To meet the requirements of
SEC Rule 15c2-12(b)(5) (the "Rule"), as applicable to a participating underwriter for the Bonds,
the District makes the following written undertaking (the "Undertaking") for the benefit of
holders of the Bonds:
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(a) Undertaking to Provide Annual Financial Information and Notice of
Material Events. The District undertakes to provide or cause to be provided, either
directly or through a designated agent:
(i) To each NRMSIR and to the SID 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) To each NRMSIR or the MSRB, and to the SID, timely notice of
the occurrence of any of the following events with respect to the Bonds, if
material: (1) principal and interest payment delinquencies; (2)non-payment
related defaults; (3) unscheduled draws on debt service reserves reflecting
financial difficulties; (4) unscheduled draws on credit enhancements reflecting
financial difficulties; (5) substitution of credit or liquidity providers, or their
failure to perform; (6) adverse tax opinions or events affecting the tax-exempt
status of the Bonds; (7) modifications to rights of holders of the Bonds; (8) Bond
calls (other than scheduled mandatory redemption of Term Bonds);
(9) defeasances; (10) release, substitution, or sale of property securing repayment
of the Bonds; and(11)rating changes; and
(iii) To each NRMSIR or to the MSRB, and to the SID, timely notice
of a failure by the District to provide required annual financial information on or
before the date specified in subsection(b) of this section.
To the extent authorized by the SEC, the District may satisfy its Undertaking under this
section by transmitting the required filings using http://www.diselosurcusa.org (or such
other centralized dissemination agent as may be approved by the SEC).
(b) Type of Annual Financial Information Undertaken to be Provided. The
annual financial information that the District undertakes to provide in subsection (a) of
this section:
(i) Shall consist of(1) annual financial statements prepared (except as
noted in the financial statements) in accordance with applicable generally
accepted accounting principles promulgated by the Government Accounting
Standards Board, as such principles may be changed from time to time, which
statements shall not be audited, except, however, that if and when audited
financial statements are otherwise prepared and available to the District they will
be provided; (2) to the extent not otherwise provided in the District's annual
financial statements or in information provided by the City pursuant to its
undertaking pursuant to the Rule for the benefit of holders of the Bonds, a
summary of revenues provided from Sales Tax Revenue (of the type included in
the Official Statement for the Bonds under the heading "SECURITY AND
SOURCES OF PAYMENT FOR THE SALES TAX BONDS—Sales Tax
Revenues-Historical Sales Tax Receipts") and a stunmary of Special Events
Center Revenues; (3) a statement of authorized, issued and outstanding bonded
debt of the District; (4) a statement of issued and outstanding debt of the District
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50855)20.Y
secured by the Contingent Loan and Support Agreement; (5) a statement of
whether or not the District has drawn on funds of the City pursuant to Section 3 of
the Contingent Loan and Support Agreement; and (6) the amount of revenues
received by the District that satisfy the local match requirement for the sales and
use taxes received.
(ii) Shall be provided to each NRMSIR and the SID, not later than the
last day of the ninth month after the end of each fiscal year of the District
(currently, a fiscal year ending December 31), as such fiscal year may be changed
as required or permitted by Washington law, commencing with the District's
fiscal year ending December 31, 2008; and
(iii) May be provided in a single or multiple documents, and may be
incorporated by reference to other documents that have been filed with each
NRMSIR and the SID, or, if the document incorporated by reference is a "final
official statement" with respect to other obligations of the District, that has been
filed with the MSRB.
(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, NRMSIR, the SID or the MSRB, under the circumstances and in the manner
permitted by the Rule.
The District will give notice to each NRMSIR or the MSRB, and the SID, of the
substance (or provide a copy) of any amendment to the Undertaking and a brief statement
of the reasons for the amendment. If the amendment changes the type of annual financial
information to be provided, the annual financial information containing the amended
financial information will include a narrative explanation of the effect of that change on
the type of information to be provided.
(d) Beneficiaries. The Undertaking evidenced by this section shall inure to
the benefit of the District and any holder of Bonds, and shall not inure to the benefit of or
create any rights in any other person.
(e) Termination of Undertaking. The District's obligations under this
Undertaking shall terminate upon the legal defeasance of all of the Bonds. In addition,
the District's obligations under this Undertaking shall terminate if those provisions of the
Rule which require the District to comply with this Undertaking become legally
inapplicable in respect of the Bonds for any reason, as confirmed by an opinion of
nationally recognized bond counsel or other counsel familiar with federal securities laws
delivered to the District, and the District provides timely notice of such termination to
each NRMSIR or the MSRB and the SID.
(f) Remedy for Failure to Comply with Undertaking. As soon as practicable
after the District Teams of any failure to comply with the Undertaking, the District will
proceed with due diligence to cause such noncompliance to be corrected. No failure by
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the District 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 District or other obligated person
to comply with the Undertaking.
(g) Designation of Official Responsible to Administer Undertaking. The
Treasurer (or such other officer of the District 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 District in respect of the Bonds set forth in this section and in
accordance with the Rule, including,without limitation, the following actions:
(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, if material,
preparing and disseminating notice of its occurrence;
(iii) Determining whether any person other than the District is an
"obligated person" within the meaning of the Rule with respect to the Bonds, and
obtaining from such person an undertaking to provide any annual financial
information and notice of material events for that person in accordance with the
Rule;
(iv) Selecting, engaging and compensating designated agents and
consultants, including but not limited to financial advisors and legal counsel, to
assist and advise the District in carrying out the Undertaking; and
(v) Effecting any necessary amendment of the Undertaking.
[OMIT FOLLOWING: IF NO 'BOND INSURANCE OR ,UPDATE IF THERE IS BOND
INSURANCE]
Section 25. Bond Insurance. The District is authorized to purchase from the 2008 Bond
Insurer the 2008 Bond Insurance Policy insuring the prompt payment of the principal of and interest
on the Bonds and agrees to the conditions for obtaining that policy, including the payment of the
premium therefor. Any notice required to be given to the 2008 Bond Insurer shall be sent by
certified or registered mail to [Name of 2008 Bond Insurer], [Address].
While the 2008 Bond Insurance Policy is in effect, the District or the Bond Registrar shall
furnish to the 2008 Bond Insurer(to the attention of the [Surveillance Department],unless otherwise
indicated):
(a) As soon as practicable after the filing thereof, copies of any financial
statements, audits and annual reports of the District;
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50855]20.7
(b) copies of any notices given to the registered owners of the Bonds,
including, without limitation, notices of any redemption of or defeasance of Bonds,
and any certificate rendered pursuant to this resolution relating to the security for the
Bonds at no cost to the 2008 Bond hnsurer;
(c) to the extent that the District has entered into a continuing disclosure
agreement with respect to the Bonds, the 2008 Bond Insurer shall be included as a
party to be notified; and
(d) such additional information the 2008 Bond Insurer may reasonably
request.
The Bond Registrar shall notify the 2008 Bond Insurer of any failure of the District to
provide relevant notices and certificates.
The District will permit the 2008 Bond Insurer to discuss the affairs, finances and accounts
of the District or any infonation the 2008 Bond Insurer may reasonably request regarding the
security for the Bonds with appropriate officers of the District. The Bond Registrar and the District
will permit the 2008 Bond Insurer to have access to and make copies of all books and records
relating to the Bonds at any reasonable time.
Section 26. Payment Procedures Under 2008 Bond Insurance Policy. The 2008 Bond
Insurer requires that the following sections be included in this resolution:
[TO BE PROVIDED BY INSURER,IF THERE IS INSURANCE]
Section 27. Parties Interested Herein. [To the extent that this resolution confers upon or
gives or grants to the 2008 Bond Insurer any right, remedy or claim under or by reason of this
resolution, the 2008 Bond Insurer is explicitly recognized as being a third-party beneficiary
hereunder and may enforce any such right,remedy or claim conferred, given or granted hereunder:]
Nothing expressed or implied in this resolution is intended or shall be construed to confer upon, or
to give or grant to, any person or entity, other than the District, [the 2008 Bond nsurer] and the
registered owners of the Bonds, any right, remedy or claim under or by reason of this resolution or
any covenant, condition or stipulation hereof, and all covenants, stipulations, promises and
agreements in this resolution contained by and on behalf of the District shall be for the sole and
exclusive benefit of the District, [the 2008 Bond Insurer]and the registered owners of the Bonds.
[Notwithstanding any other provision of this resolution, the District shall notify the 2008
Bond Insurer immediately if at any time there are insufficient funds to make any payments of
principal and/or interest as required and immediately i upon the occurrence of any;event of default
hereunder. Anything in this resolution to the contrary notwithstanding, upon the occurrence and
continuance of an event of default, the 2008 Bond Insurer shall be entitled to control and direct the
enforcement of all rights and remedies granted to the Bond owners for the benefit of the Bond
owners under this resolution.]
[Any provision of this resolution expressly recognizing:or granting rights in or to the 2008
Bond Insurer may not be amended in any manner which affects the rights of the 2008 Bond Insurer
hereunder without the prior written consent of the 2008 Bond Insurer.; The 2008 Bond insurer
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50855R0J
reserves the right to charge the District a reasonable fee for any such consent or amendmem to this
resolution while the 2008 Bond Insurance Policy is outstanding. Unless otherwise provided in this
section,the 2008 Bond Insurer's consent shall be required,in addition to Bond owner consent,when
required, for the following purposes: W execution and delivery of any supplemental resolution, and
(ii)initiation or approval of any other action:which requires Bond owner consent,]
[Any reorganization or liquidation plan with respect to the District must be acceptable to the
2008 Bond Insurer. In the event of any reorganization or liquidation, the 2008 Bond Insiu-er shall
have the right to vote on behalf of all Bond owners who hold 2008 Bond Insurer-insured Bonds
absent a default by the 2008 Bond Insurer under the 2008 Bond Insurance Policy insuring such
bonds.]
ADOPTED by the Board of Directors of the City of Dent Special Events Center Public
Facilities District at a regular open public meeting thereof held this 20th day of February, 2008,
the following Directors being present and voting in favor of the resolution.
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Chair and Board Member
Secretary and Board Member
Board Member
Board Member
Board Member
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508559205
CERTIFICATION
1, the undersigned, as Secretary of the City of Dent Special Events Center Public
Facilities District (the"District"), hereby certify as follows:
1. The foregoing Resolution No. 2008-2 (the "Resolution") is a full, true and
correct copy of the Resolution duly adopted at a regular meeting of the District's Board of
Directors held at the regular meeting place thereof on February 20, 2008, as that Resolution
appears on the minute book of the District;
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 of Directors by mail or by
personal delivery at least 24 hours prior to the special meeting, a true and complete copy of
which notice is attached hereto as Appendix 1;
3. No local radio or television stations, or newspapers of general circulation, have
on file with the District a written request to be notified of any special meetings; [OR] 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 District written request to be
notified of special meetings, or to which such notice customarily is given; ;and [PLEASE
CONFIRM]
4. A quorum was present throughout the meeting and a sufficient number of
members of the Board of Directors voted in the proper manner for the adoption of the
Resolution.
IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of February,
2008.
CITY OF DENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Secretary
50955720,7
FP Draft 02/14/2008
CITY OF DENT SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT
RESOLUTION NO. 2008-3
A RESOLUTION of the City of Kent Special Events Center Public
Facilities District providing for the issuance of$[ ] aggregate principal
amount of Special Events Center Revenue Bonds, 2008 (Taxable), of the District
to provide funds with which to pay a portion of the cost of acquiring, constructing
and equipping a regional center; fixing the date, form, maturities, interest rates,
terns and covenants of the bonds; establishing a revenue fund, a debt service fund
and a project fund; [providing for insurance]; and approving the sale and
providing for the delivery of the bonds to Piper Jaffray & Co., Lehman Brothers
Inc. and Wachovia Securities hie.
ADOPTED: February 20, 2008.
This doctuneut prepared by:
FOSTER PEPPER PLLC
I II I Third Avenue, Suite 3400
Seattle, Washington 98101
(206) 447-4400
508557766
TABLE OF CONTENTS
Section1. Definitions...................................................................................................................2
Section 2. Authorization of Bonds...............................................................................................6
Section 3. Description of Bonds. .................................................................................................6
Section 4. Registration and Transfer of Bonds. ...........................................................................6
Section5. Payment of Bonds.......................................................................................................7
Section 6. Redemption Provisions and Purchase for Cancellation of Bonds. .............................8
Section7. Notice of Redemption.................................................................................................9
Section 8. Failure to Redeem Bonds............................................................................................9
Section 9. Form and Execution of Bonds. ...................................................................................9
Section10. Bond Registrar. .........................................................................................................10
Section 11. Refimding or Defeasanec of the Bonds. ...................................................................I I
Section 12. Pledge of District Revenue. ......................................................................................11
Section 13. Creation of Funds and Accounts...............................................................................12
Section 14. District Revenue Fund. .............................................................................................12
Section15. Debt Service Fund.....................................................................................................13
Section 16. Deposit of Bond Proceeds.........................................................................................14
Section 17. Additional Covenants................................................................................................14
Section 18. Additional Revenue Bonds. ......................................................................................16
Section 19. Supplements and Amendments.................................................................................17
Section 20. Defaults and Remedies. ............................................................................................18
Section 21. Approval of Bond Purchase Contract. ......................................................................20
Section 22. Preliminary Official Statement Deemed Final..........................................................20
Section 23. Undertaking to Provide Continuing Disclosure........................................................21
[OMIT FOLLOWING TWO SECTIONS IF NO BOND INSURANCE OR UPDATE IF THERE IS BOND INSUFRANCE1
Section24. Bond Insurance.........................................................................................................23
Section 25. Payment Procedures Under 2008 Bond Insurance Policy........................................24
Section 26. Parties Interested Herein...........................................................................................24
i
sosssnbc
CITY OF KENT SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT
RESOLUTION NO. 2008-3
A RESOLUTION of the City of Kent Special Events Center Public
Facilities District providing for the issuance of$[ ] aggregate principal
amount of Special Events Center Revenue Bonds, 2008 (Taxable), of the District
to provide funds with which to pay a portion of the cost of acquiring, constructing
and equipping a regional center; fixing the date, form, maturities, interest rates,
terms and covenants of the bonds; establishing a revenue fund, a debt service fund
and a project fund; [providing for insurance]; and approving the sale and
providing for the delivery of the bonds to Piper Jaffray & Co., Lehman Brothers
Inc. and Wachovia Securities Inc.
WHEREAS, the City of Kent Special Events Center Public Facilities District (the
"District"), is a duly organized and legally existing municipal corporation of the State of
Washington formed by the City of Kent, Washington (the "City"); and
WHEREAS, the District is authorized by chapter 35.57 RCW to acquire, construct, own,
remodel, maintain, equip, repair, finance and operate"regional centers;" and
WHEREAS, the District is authorized by RCW 35.57.090 to issue revenue bonds to fund
revenue-generating facilities, or portions of facilities, which it is authorized to provide or operate;
and
WHEREAS, the District's Board of Directors (the "Board") finds and determines that the
residents of the District and the region will benefit from the District's financing of the
acquisition and constriction of an approximately 153,000 square foot regional center comprised
of a multi-family arena for hockey and other public uses, together with related parking facilities
(collectively, the "Special Events Center"); and
WHEREAS, the District has entered into an Interlocal Agreement for Development of
Special Events Center with the City of Kent, Washington (the "City"), regarding the design,
development, acquisition, construction, operation and management of the Special Events Center;
and
WHEREAS, the City commenced construction of the Special Events Center on July 27,
2007, in satisfaction of the requirement of RCW 35.57.040(1)(d) that construction of a regional
center be commenced prior to July 1, 2008; and
WHEREAS, the Board now desires to provide for the issuance of the revenue bonds
authorized herein to provide a portion of the long-term financing for the acquisition, construction
and equipping of the Special Events Center; and
WHEREAS, the District and the City have entered into a Contingent Loan and Support
Agreement(defined herein) pursuant to which, among other things, in consideration of the District's
issuance of the bonds authorized herein to finance and provide the Special Events Center,the City is
obligated to: transfer Special Events Center Revenues (defined herein) to the District in amounts
W85591Gti
sufficient to pay the debt service on the bonds authorized herein; to lend City fiords to the District to
pay the debt service on the bonds authorized herein in the event Special Events Center Revenues are
not sufficient for that purpose; and to pay all operation and maintenance expenses of the Special
Events Center from remaining Special Events Center Revenues and from other City funds; and
[WHEREAS, [Name of 2008 Bond Insurer], a [State]-domiciled [description of company]
(the "2008 Bond Insurer"), has made a commitment to issue an insurance policy (the 2008 Bond
Insurance Policy") insuring the payment when due of the principal of and interest on the Bonds
as provided therein, and the Board deems that the purchase of the 2008 Bond Insurance Policy is
in the best interest of the District; and] [Update and revise if there is to be bond insurance
otherwise delete this paragraph]
WHEREAS, Piper Jaffray & Co., Lehman Brothers Inc. and Wachovia Securities Inc.
(collectively, the "Purchaser"),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 DIRECTORS OF THE CITY OF KENT
SPECIAL EVENTS CENTER PUBLIC FACILITIES DISTRICT, as follows:
Section 1. Definitions. The words and phrases set forth herein with initial capitalization
shall have the respective meanings ascribed to such words and phrases in the recitals hereto and
in this Section 1, unless the context clearly requires otherwise.
"Additional Revenue Bonds" shall mean any bonds or other obligations that the District
may hereafter issue pursuant to Section 18 of this resolution that are secured by a lien upon the
District Revenue that is equal to the lien upon the District Revenue in favor of the Bonds created
by this resolution.
"Additional Sales Tax Bonds" shall mean any bonds or other obligations that the District
may hereafter issue pursuant to Section 19 of the Sales Tax Bond Resolution that are secured by
a pledge of Sales Tax Revenue and District Revenue.
"Bond Insurance Policy" shall mean any bond insurance policy or credit facility issued by a
Bond Insurer insuring the payment when due of the principal of and interest on the Bonds or any
Additional Revenue Bonds, as provided therein.
["2008 Bond Insurance Policy"shall mean the financial guaranty insurance policy issued by
the 2008 Bond Insurer insuring the payment when due of the principal of and interest on the Bonds
as provided therein.]
"Bond Insurer" shall mean any bond insurer or credit provider (other than the City)
undertaking to insure or provide credit support for the Bonds or any series of Additional Revenue
Bonds, and designated as such in the applicable authorizing resolution.
["2008 Bond Insurer" shall mean [Name of 2008 Bond Insurer], a [State]-domiciled stock
[description of company].] [Delete if there will be no 2008 Bond Insurance].
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"Bond Purchase Contract" shall mean the Bond Purchase Contract dated February 20,
2008,between the District and the Purchaser, relating to the Bonds.
"Bond Register" shall mean the books or records maintained by the Bond Registrar on
which are recorded the names and addresses of the owners of each of the Bonds.
"Bond Registrar" shall mean the fiscal agent of the State of Washington (as such may be
designated by the State of Washington from time to time) acting in the capacity of registrar,
paying agent, transfer agent and authenticating agent for the Bonds.
"Bondowners' Trustee" shall have the meaning given such term in Section 20 of this
resolution.
"Bonds" shall mean the herein-authorized Special Events Center Revenue Bonds, 2008
(Taxable), of the District, and"Bond" shall inean any of the Bonds.
"Chair" shall mean the Chair of the District, or any presiding officer of the District, or
his/her successor in functions, if any.
"City" shall mean the City of Kent, Washington, a municipal corporation of the State of
Washington.
"City Contingent Loan Payments" shall mean any loan payments required to be made by
the City to the District for Required Debt Service pursuant to the Contingent Loan and Support
Agreement that are derived from City funds other than Special Events Center Revenues.
"City Special Events Center Payments" shall mean all payments required to be made by
the City to the District for Required Debt Service pursuant to the Contingent Loan and Support
Agreement that are derived from and represent Special Events Center Revenues.
"Contingent Loan and Support Agreement" shall mean the Contingent Loan and Support
Agreement Regarding Financing for Kent Special Events Center between the City and the District,
dated as of February 20, 2008, as the same may be amended from time to time.
"Debt Service Fund" shall mean the District's Revenue Bond Debt Service Fund created
pursuant to Section 13 of this resolution.
"Debt Service Payment Date" shall mean any date on which the principal of and/or
interest on the Bonds is due and payable as provided in Section 3 of this resolution.
"Default" shall have the meaning given such term in Section 20 of this resolution.
"District Revenue" shall mean all revenue, earnings and money received by the District
from and on account of City Special Events Center Payments and City Contingent Loan
Payments.
"District Revenue Fund" shall mean the fund of that name created pursuant to Section 13
of this resolution.
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"DTC" shall mean The Depository Trust Company, a limited-purpose trust company
organized under the laws of the State of New York, which will act as securities depository for the
Bonds.
"Interlocal Agreement" shall mean the Interlocal Agreement for Development of Special
Events Center between the City and the District dated September 14, 2007, as the same may be
amended from time to time.
"Intergovernmental Contracts" shall mean, collectively, the Interlocal Agreement and the
Contingent Loan and Support Agreement.
"Letter of Representations" shall mean the Blanket Issuer Letter of Representations with
DTC setting forth certain understandings of the District and the Bond Registrar with respect to
DTC's services, as it may be amended from time to time.
"MSRB" shall mean the Municipal Securities Rulemaking Board.
"NRMSIR" shall mean each nationally recognized municipal securities information
repository designated by the SEC as such in accordance with its Rule 15e2-12 (but only for so
long as such designation remains in effect).
"Operation and Maintenance Expenses" shall mean all reasonable expenses incurred in
causing the Special Events Center to be operated and maintained in good repair, working order
and condition, including without limitation: management fees or other payments to third parties
payable in respect of the operation of the Special Events Center; personnel costs; the cost of
ordinary maintenance acid repair; utilities; supplies; food and beverage service and supply costs;
equipment purchase and lease payments; administrative expenses, including administrative
expenses of the District; the costs of advertising, marketing and business promotion; deposits,
premiums, assessments or other payments for insurance; and taxes and assessments; all as
determined in accordance with generally accepted accounting principles applicable to the City and
its operations. The term "Operation and Maintenance Expenses" does not include any
depreciation of or capital expenditure for the Special Events Center.
"Preliminary Official Statement" shall mean the Preliminary Official Statement dated
February 11, 2008,prepared in comicetion with the sale of the Bonds.
"Project Fund" shall mean the District's Special Events Center Project Fund created
pursuant to Section 13 of this resolution.
"Required Debt Service" shall mean, for any calendar year, with respect to the Bonds and
each series of Additional Revenue Bonds, the amount required to make scheduled payments of
principal of(including mandatory redemption payments with respect to Term Bonds) and interest
on the Bonds and such Additional Revenue Bonds in that calendar year.
"Sales Tax Bond Debt Service Fund" shall mean the District's Sales Tax Bond Debt
Service Fund created pursuant to Section 14 of the Sales Tax Bond Resolution.
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508559]6.6
"Sales Tax Bond Insurance Policy" shall mean any bond insurance policy or credit
facility issued by a Sales Tax Bond Insurer insuring the payment when due of the principal of
and interest on the Sales Tax Bonds or any Additional Sales Tax Bonds, as provided therein.
"Sales Tax Bond Insurer" shall mean any bond insurer or credit provider (other than the
City) undertaking to insure or provide credit support for the Sales Tax Bonds or any series of
Additional Sales Tax Bonds, and designed as such in the applicable authorizing resolution.
"Sales Tax Bond Resolution" shall mean the District's Resolution No. 2008-[_].
"Sales Tax Bonds" shall mean the District's $[ ] par amount Special Events
Center Sales Tax Bonds, 2008,issued pursuant to the Sales Tax Bond Resolution.
"Sales Tax Revenue" shall mean the money received by the District from the Washington
State Department of Revenue on account of the sales and use tax imposed by and collected for
the District pursuant to RCW 82.14.390, as the same may be amended from time to time, or any
successor statute.
"SEC" shall mean the United States Securities and Exchange Commission.
"Secretary" shall mean the Secretary of the District, or other officer of the District who is
the custodian of the records of the proceedings of the Board, or his/her successor in functions, if
any.
"SID" shall mean a state information depository for the State of Washington, if any,
designated by the SEC as such in accordance with its Rule 15c2-12 (but only for so long as such
designation remains in effect).
"Special Events Center" shall mean the land, real property improvements, buildings,
facilities, fixtures, equipment, support facilities and related parking facilities comprising a
special events center of approximately 153,000 square feet, including a 6,025-seat ice arena, as
such facilities may be expanded from time to time, located in the City and constituting a
"regional center" within the meaning of chapter 35.57 RCW.
"Special Events Center Revenues" shall mean all revenue, earnings and money received
by the City from or on account of the operation and/or ownership of the Special Events Center,
including but not limited to license fees received from the City from the Team pursuant to the
Team License Agreement, facility fees, concession revenues, advertising revenues, suite license
revenues, club seat revenues, parking revenues and naming rights revenues.
"State" shall mean the State of Washington.
"Team" shall mean the Thunderbird Hockey Enterprises, LLC, or its assignee or
successor under the Team License Agreement.
"Team License Agreement" shall mean the License Agreement between the City and the
Team dated August 7, 2007, as the same maybe amended from time to time.
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"Term Bonds" shall mean those Additional Revenue Bonds designated as such in the
applicable authorizing resolution.
"Treasurer" shall mean the Finance Director of the City as ex officio Treasurer of the
District or his/her successor in functions, if any.
"Vice-Chair" shall mean the Vice-Chair of the District, or any vice-presiding officer of
the District, of his/her successor in functions, if any.
Section 2. Authorization of Bonds. The District shall borrow money on the credit of the
District and issue the Bonds evidencing that indebtedness in the aggregate principal amount of
$[ ] to pay a portion of the cost of acquiring, constructing and equipping the Special
Events Center, to fund interest on the Bonds through [June 1, 2009], to pay [the premium for the
2008 Bond Insurance Policy], and to pay the costs of issuance and sale of the Bonds.
Section 3. Description of Bonds. The Bonds shall be called Special Events Center
Revenue Bonds, 2008 (Taxable); shall be in the aggregate principal amount of$[ ; shall
be dated their date of initial delivery; shall be in the denomination of $5,000 or any integral
multiple thereof within a single maturity; shall be numbered separately in the manner and with
any additional designation as the Bond Registrar deems necessary for purposes of identification;
shall bear interest (computed on the basis of a 360-day year of twelve 30-day months) payable
semiannually on each June 1 and December 1, commencing December 1, 2008, to the maturity
or earlier redemption of the Bonds; and shall mature on December 1 in years and amounts and
bear interest at the rates per annum as follows:
Maturity Interest Maturity Interest
Years Amounts Rates Years Amounts Rates
2009 $ % 2015 $ %
2010 2016
2011 2017
2012 2018
2013 2019
2014 2020
Interest on the Bonds will not be excluded from gross income of the registered owners for
federal income tax purposes.
The Bonds are not an indebtedness of the District, and the principal of and interest on the
Bonds shall be payable exclusively from the District Revenue, as further described herein.
Section 4. Registration 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, interest rate and maturity. Bonds may be
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transferred only if endorsed in the mariner provided thereon and surrendered to the Bond
Registrar. Any exchange or transfer shall be without cost to the owner or transferee. The Bond
Registrar shall not be obligated to exchange or transfer any Bond during the 15 days preceding
any principal payment or redemption date.
The Bonds initially shall be registered in the name of Cede & Co., as the nominee of
DTC. The Bonds so registered shall be held in fully immobilized form by DTC as depository in
accordance with the provisions of the Letter of Representations substantially in the form on file
with the secretary and by this reference made a part hereof. Neither the District 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 so long as any Bonds are held in fiilly 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
nominees and 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 District or such substitute depository's successor; or (iii) to any person if the
Bonds are no longer held in immobilized form.
Upon the resignation of DTC or its successor (or any substitute depository or its
successor) from its functions as depository, or a determination by the District 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 District 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 District
determines that the Bonds are to be in certificated form, the ownership of Bonds may be
transferred to any person as provided herein and the Bonds no longer shall be held in fully
inmrobilized 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 of the Bond Registrar mailed on the interest payment date to the registered
owners at the addresses appearing on the Bond Register on the 151h 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 a series of Bonds prior to the applicable record date, by wire transfer on
the interest payinent date; provided that the costs of such wire transfer shall be paid by the
requesting registered owner. Principal of the Bonds shall be payable upon presentation and
surrender of the Bonds by the registered owners to the Bond Registrar. Notwithstanding the
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foregoing, as long as the Bonds are registered in the name of DTC or its nominee, payment of
principal of and interest on the Bonds shall be made in the manner set forth in the Letter of
Representations.
Section 6. Redemption Provisions and Purchase for Cancellation of Bonds.The Bonds
are subject to optional redemption at the option of the District, on any date prior to their
maturity, in whole or in part, with maturities to be designated by the District, at a redemption
price equal to 100% of the principal amount of such Bonds plus the Make-Whole Premium (as
defined below), if any,plus the accrued interest, if any, thereon to the redemption date.
The "Make-Whole Premium" with respect to any Bond to be redeemed will be equal to
the excess, if any, of the sum of the present values, calculated as of the redemption date, of(a)
each interest payment that, but for such redemption, would have been payable on the Bond or
portion thereof being redeemed on each interest payment date occurring after the redemption
date (excluding any accrued interest for the period prior to the redemption date), and (b) the
principal amount that, but for such redemption, would have been payable at the final maturity of
the Bond being redeemed, divided by the principal amount of the Bond being redeemed.
The present values of interest and principal payments referred to in the above paragraph
will be determined in accordance with generally accepted principles of financial analysis. These
present values will be calculated by discounting the amount of each payment of interest or
principal from the date that each such payment would have been payable, but for the redemption,
to the redemption date at a discount rate equal to the "comparable treasury yield" (as defined
below) phis 12.5 basis points. The Make-Whole Premium will be calculated by an independent
investment banking institution or independent financial advisor of national standing appointed by
the District.
For purposes of determining the Make-Whole Premium, "comparable treasury yield"
means a rate of interest per annum equal to the weekly average yield to maturity of United States
Treasury Securities that have a constant maturity that corresponds to the remaining term to
maturity of the Bonds, calculated to the nearest 1/12th of a year. The comparable treasury yield
will be determined as of the third business day immediately preceding the applicable redemption
date.
The weekly average yields of United States Treasury Securities will be determined by
reference to the most recent statistical release published by the Federal Reserve Bank of New
York and designated "H.15(519) Selected Interest Rates" or any successor release (the "H.15
statistical release"). If the H.15 statistical release sets forth a weekly average yield for United
States Treasury Securities having a constant maturity that is the same as the remaining term
calculated as set forth above, then the comparable treasury yield will be equal to such weekly
average yield. In all other cases, the comparable treasury yield will be calculated by
interpolation on a straight-line basis, between the weekly average yields on the United States
Treasury Securities that have a constant maturity closest to and less than the remaining term (in
each case as set forth in the H.15 statistical release or any successor release). Any weekly
average yields calculated by interpolation will be rounded to the nearest 1/100th of 1%, with any
figure of 1/200th of 1% or above being rounded upward. If weekly average yields for United
States Treasury Securities are not available in the H.15 statistical release or otherwise, then the
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comparable treasury yield will be calculated by interpolation of comparable rates selected by an
independent investment banker or independent financial advisor, in the manner described above.
Portions of the principal amount of any Bond, in installments of$5,000 or any integral
multiple thereof, may be redeemed. if less than all of the principal amount of any Bond is
redeemed, upon surrender of that Bond to the Bond Registrar, there shall be issued to the
registered owner, without charge therefor, a new Bond (or Bonds, at the option of the registered
owner) of the same maturity and interest rate in any of the denominations authorized by this
resolution in the aggregate principal arnormt remaining unredeemed.
The District farther reserves the right and option to purchase any or all of the Bonds at
any time at any price acceptable to the District plus accrued interest to the date of purchase.
All Bonds purchased or redeemed under this section shall be cancelled.
Notwithstanding the foregoing, for so long as the Bonds are registered in the name of
DTC or its nominee, selection of Bonds for redemption shall be in accordance with the Letter of
Representations.
Section 7. Notice of Redemption. The District shall cause notice of any intended
redemption of Bonds to be given not less than 30 nor more than 60 days prior to the date fixed
for redemption by first-class mail, postage prepaid, to the registered owner of any Bond to be
redeemed at the address appearing on the Bond Register at the time the Bond Registrar prepares
the notice, and the requirements of this sentence shall be deemed to have been fulfilled when
notice has been mailed as so provided, whether or not it is actually received by the owner of any
Bond. Interest on Bonds called for redemption shall cease to accrue on the date fixed for
redemption unless the Bond or Bonds called are not redeemed when presented pursuant to the
call. In addition, the redemption notice shall be mailed within the same period, postage prepaid,
to such other persons, [including the 2008 Bond Insurer at its principal office in New York, New
York] [CONFIRM PRINCIPAL{OFFICE IF THERE IS BOND INSURANCE OR DELETE IF
THERE'S NO BOND: INSURANCE], and registered securities depositories, and with such
additional information as the District shall determine, but these additional mailings shall not be a
condition precedent to the redemption of Bonds. Notwithstanding the foregoing, for so long as
the Bonds are registered in the name of DTC or its nominee, notice of redemption shall be given
in accordance with the Letter of Representations.
Section 8. Failure to Redeem Bonds. If any Bond is not redeemed when properly
presented at its maturity or call date, the District shall be obligated to pay interest on that Bond at
the same rate provided in the Bond from and after its maturity or call date until that Bond, both
principal and interest, is paid in frill or until sufficient money for its payment in full is on deposit
in the Debt Service Fund and the Bond has been called for payment by giving notice of that call
to the registered owner of each of those unpaid Bonds.
Section 9. Form and Execution of Bonds. The Bonds shall be printed or lithographed on
good bond paper in a form consistent with the provisions of this resolution and State law shall be
signed by the Chair and Secretary, either or both of whose signatures may be manual or in
facsimile. The Bonds need not be sealed with the corporate seal of the District.
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50855Y166
Each Bond shall contain the following recital: "This Bond and the Bonds of this series are
not an indebtedness of the District, and the interest and principal on the Bonds shall only be payable
fi-om the District Revenue pledged in the Bond Resolution to meet the principal and interest
requirements. The owner of this Bond shall not have any claim against the District arising from this
Bond except for payment from the District Revenue pledged to meet the principal and interest
requirements. This Bond and the Bonds are not obligations of the City of Dent. The owner or
bearer of this Bond shall not have any claim against the City of Dent in respect of this Bond except
as provided under the Contingent Loan and Support Agreement."
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 City of Dent Special Events
Center Public Facilities Special Events Center Revenue Bonds, 2008 (Taxable),
described in the Bond Resolution.
WASHINGTON STATE FISCAL AGENT
Bond Registrar
By
Authorized Signer
The authorized signing of a Certificate of Authentication shall be conclusive evidence that the
Bond so authenticated has been duly executed, authenticated and delivered and is entitled to the
benefits of this resolution.
If any officer whose facsimile signature appears on the Bonds ceases to be an officer of
the District 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 District, those Bonds
nevertheless may be authenticated, issued and delivered and, when authenticated, issued and
delivered, shall be as binding on the District as though that person had continued to be an officer
of the District authorized to sign bonds. Any Bond also may be signed on behalf of the District
by any person who, on the actual date of signing of the Bond, is an officer of the District
authorized to sign bonds, although he or she did not hold the required office on the date of
issuance of the Bonds.
Section 10. Bond Registrar. The District hereby appoints the fiscal agent of the State as
Bond Registrar. The Bond Registrar shall keep, or cause to be kept, at its principal corporate
trust office, sufficient books for the registration and transfer of the Bonds, which shall be open to
inspection by the District at all times. The Bond Registrar is authorized, on behalf of the
District, to authenticate and deliver Bonds transferred or exchanged in accordance with the
provisions of the Bonds and this resolution, to serve as the District's paying agent for the Bonds
and to carry out all of the Bond Registrar's powers and duties under this resolution.
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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. Refmiding or Defeasance of the Bonds. The District may issue refunding
bonds pursuant to the laws of the State or use money available from any other lawful source to
pay when due the principal of and interest on the Bonds, or any portion thereof included in a
refunding or defeasance plan, and to redeem and retire, refund or defease all such then-
outstanding Bonds (hereinafter collectively called the "defeased Bonds") and to pay the costs of
the refunding or defeasance. If money and/or "government obligations" within the meaning of
RCW 39.53.010(4) maturing at a time or times and bearing interest in amounts (together with
money, if necessary) sufficient to redeem and retire, refund or defease the defeased Bonds in
accordance with their terms are set aside in a special trust fund or escrow account irrevocably
pledged to that redemption, retirement or defeasance of defeased Bonds (hereinafter called the
"trust account"), then all right and interest of the owners of the defeased Bonds in the covenants
of this resolution and in the fruids 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
District shall include in the refunding or defeasance plan such provisions as the District deems
necessary for the random selection of any defeased Bonds that constitute less than all of a
particular maturity of the Bonds, for notice of the defeasance to be given to the owners of the
defeased Bonds and to such other persons as the District shall determine, and for any required
replacement of Bond certificates for defeased Bonds. The defeased Bonds shall be deemed no
longer outstanding, and the District 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 naive of DTC or its nominee, notice of any defeasance
of Bonds shall be given to DTC in the manner prescribed in the Letter of Representations for
notices of redemption of Bonds.
[Notwithstanding anything in this section to the contrary, if the principal of and/or
interest due on the Bonds is paid by the 2008 Bond Insurer pursuant to the 2008 Bond Insurance
Policy, the Bonds shall be treated as remaining outstanding for all purposes, not defeased or
otherwise satisfied and shall not be considered paid by the District, and the assignment and
pledge of the revenues and all other covenants, agreements and other obligations of the District
to the registered owners of the Bonds shall continue to exist and shall run to the benefit of the
2008 Bond hisurer, and the 2008 Bond Insurer shall be subrogated to the rights of those
registered owners.] [DELETE IF NO BOND INSURANCE]'
Section 12. Pledge of District Revenue. The District Revenue is hereby pledged, for the
equal and ratable benefit of the owners from time to time of the Bonds, as security for payment
of the principal of and premium, if any, and interest on the Bonds, subject to the provisions of
this resolution permitting the application of amounts held hereunder to the purposes set forth
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508557]6.6
herein. Such pledge is hereby declared to be a prior lien and charge on the District Revenue
superior to all other liens and charges of any kind or nature whatsoever, except that such pledge,
lien and charge on the District Revenue shall be on a parity with the pledge, lien and charge
thereon made in Section 13 of the Sales Tax Bond Resolution in favor of the Sales Tax Bonds
and, subject to the provisions of Section 19 of the Sales Tax Bond Resolution and Section 18
hereof, liens on the District Revenue may be created in favor of any Additional Sales Tax Bonds
and Additional Revenue Bonds, in each case on a parity with the pledge thereof made under this
Section 12 in favor of the Bonds.
Section 13. Creation of Funds and Accounts. The following funds and accounts are
established and shall be maintained in the office of the Treasurer separate and distinct from all other
funds and accounts of the District: the District Revenue Fund, and the Revenue Bond Debt
Service Fund (the "Debt Service Fund"), which funds are "special funds" within the meaning of
RCW 35.57.090(1). The District also creates and establishes, and there shall be maintained in the
office of the Treasurer until such time as there is no money on deposit therein, separate and
distinct from all other funds and accounts of the District, the Project Fund, consisting of the
Revenue Bond Proceeds Account and the Sales Tax Bond Proceeds Account therein.
Section 14. District Revenue Fund. For so long as any Bonds, Sales Tax Bonds,
Additional Revenue Bonds or Additional Sales Tax Bonds remain outstanding, and unless
otherwise specifically provided herein, all District Revenue shall be transferred to and deposited
into the District Revenue Fund as received by the District from the City. District Revenue
deposited therein shall be disbursed in the following order of priority, commencing with all
District Revenue currently on hand in any other fund or account of the District:
First, to make the required deposits into the Debt Service Fund for the payment of
interest due on the Bonds and any Additional Revenue Bonds (as provided in
Section 15 of this resolution) and, after taking into account Sales Tax Revenues
available to the District for the payment of interest due on the Sales Tax Bonds
and any Additional Sales Tax Bonds, to make the required deposits to the Sales
Tax Bond Debt Service Fund for the payment of interest due on the Sales Tax
Bonds and any Additional Sales Tax Bonds (as provided in Section 16 of the
Sales Tax Bond Resolution);
Second, to make the required deposits into the Debt Service Fund for the payment of
principal of the Bonds and any Additional Revenue Bonds at maturity or upon
mandatory sinking fund redemption prior to scheduled maturity (as provided in
Section 15 of this resolution) and, after taking into account Sales Tax Revenues
available to the District for the payment of principal of the Sales Tax Bonds and
any Additional Sales Tax Bonds, to make the required deposits to the Sales Tax
Bond Debt Service Fund for the payment of principal of the Sales Tax Bonds
and any Additional Sales Tax Bonds at maturity or upon mandatory sinking
find redemption prior to scheduled maturity (as provided in Section 16 of the
Sales Tax Bond Resolution);
Third, to reimburse any Bond Insurer for any payments made under any Bond
Insurance Policy and other amounts due and owing to any Bond Insurer in
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respect of the Bonds and any Additional Revenue Bonds and, after taking into
account Sales Tax Revenues available to the District for the payment thereof, to
reimburse any Sales Tax Bond Insurer for any payments made under any Sales
Tax Bond Insurance Policy and other amounts due and owing to any Sales Tax
Bond Insurer in respect of the Sales Tax Bonds and any Additional Sales Tax
Bonds;
Fourth, to repay the principal of and interest on any loans made by the City to the
District under Section 3 of the Contingent Loan and Support Agreement in
respect of payments of principal of and interest on the Bonds, the Sales Tax
Bonds, any Additional Revenue Bonds and any Additional Sales Tax Bonds;
and
Fifth, to provide for costs of and reserves for long-term capital repairs, renewals and
replacements of the Special Events Center, and for other lawful purposes, in no
particular order of preference and all as determined by the City in consultation
with the District.
The District hereby covenants that it will exercise due regard for the anticipated financial
requirements to be satisfied as priorities First through Fourth of this section in each calendar year
prior to authorizing or making any disbursement of money in the District Revenue Fund for the
purpose identified as priority Fifth. Money in the District Revenue Fund shall be invested by the
Treasurer, but only upon the direction of the District, in any legal investment for District funds,
and interest earnings shall accrue to and be deposited in the District Revenue Fund.
Section 15. Debt Service Fund. Capitalized interest amounts required to be transferred
from the Revenue Bond.Proceeds Account of the Project Fund shall be paid into the Debt Service
Fund. For so long as the Bonds or any Additional Revenue Bonds remain outstanding, the District
shall deposit(and the Treasurer is hereby directed to deposit), fiom the District Revenue Fund,on or
before each Debt Service Payment Date amounts that are sufficient,together with other money then
on deposit in the Debt Service Fund, to pay the principal of(if any) and the interest on the Bonds
that is scheduled to come due on such Debt Service Payment Date.
The Board finds and determines that the District Revenue to be deposited into the Debt
Service Fund on each Debt Service Payment Date is a fixed amount, and that such fixed amount
shall be a lien and charge against these District Revenue as set forth in Section 12.
The District may, at the Board's sole discretion, fund any deficiency in the Debt Service
Fund with available amounts from other available District sources, including Sales Tax Revenue;
however, (i)there is no assurance that money will be available in from other available District
sources to fund deposits into the Debt Service Fund if the District encounters financial difficulties,
(ii)the District does not expect that money from other available District sources will be used to pay
debt service on the Bonds, (iii) amounts from other available District sources are not pledged to
secure the Bonds, and the owners of the Bonds have no lien or charge on money in such funds, and
(iv)neither the District nor the City can be compelled, in an action for mandamus or otherwise, to
transfer money to the Debt Service Fund from Sales Tax Revenue or other available District
sources.
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Section 16. Deposit of Bond Proceeds. The proceeds received by the District from the
sale and delivery of the Bonds shall be paid into the Revenue Bond Proceeds Account within the
Project Fund and shall be used for the purposes specified in Section 2 of this resolution.
Proceeds of the Bonds allocated to pay the cost of acquiring, constructing and equipping the
Special Events Center shall be transferred to the City for that purpose upon requisitions by the
City for payment of such costs supported by documentation provided to the City under the City's
contracts for the construction of the Special Events Center that the City determines to be
sufficient. On each Debt Service Payment Date on which interest on the Bonds is to be paid
from Bond proceeds, the Treasurer shall transfer the required amount from the Revenue Bond
Proceeds Account to the Debt Service Fund for that purpose. Until needed to pay the cost of
acquiring, constructing and equipping the Special Events Center, the cost of issuance and sale of
the Bonds, or interest on the Bonds, the District may invest money in the Revenue Bond
Proceeds Account temporarily in any legal investment, and the investment earnings may be
retained in the Revenue Bond Proceeds Account and be spent for the purposes of that fund,
except that earnings subject to a federal tax or rebate requirement may be withdrawn from the
Revenue Bond Proceeds Account and used for those tax or rebate purposes.
Section 17. Additional Covenants.
(a) Fees, Rates and Charges. From and after the completion of the Special Events
Center, the District shall cause the City to fix, maintain and collect fees, rates and charges for the
use of the services and facilities and all commodities sold, furnished or supplied by or through the
Special Events Center, which fees, rates and charges shall be adjusted from time to time, so that
such fees, rates and charges will be at optimal levels to produce total Special Events Center
Revenues that will at all times be at least sufficient to enable the City to make City Special Events
Center Payments equal to Required Debt Service and, taking into account Sales Tax Revenue
available therefor, Required Debt Service (as such term in defined in the Sales Tax Bond
Resolution) on the Sales Tax Bonds and Additional Sales Tax Bonds, as and when the same shall
become due and payable, and to make all other payments which the District is obligated to make
pursuant to this resolution.
(b) Liens and Encumbrances. The District will not at any time create or permit to
accrue or to exist any lien or other encuunbrance or indebtedness upon the District Revenue, or any
part thereof, prior or superior to the lien thereon for the payment of the Bonds and any Additional
Revenue Bonds, and will pay and discharge, or cause to be paid and discharged, any and all lawful
claims for labor, materials or supplies which, if unpaid, might become a lien or charge upon the
District Revenue, or any part thereof,prior to or superior to the lien of the Bonds and any Additional
Revenue Bonds, or which might impair the security of the Bonds and any Additional Revenue
Bonds. The Sales Tax Bonds and any Additional Sales Tax Bonds will be payable from and
secured by the District Revenue on a parity basis with the Bonds and any Additional Revenue
Bonds.
(c) Authority Regarding the District Revenue. The District shall talce all reasonable
measures permitted by law to enforce payment to it of all District Revenue, and shall at all times,
to the extent permitted by law, defend, preserve and protect the rights, benefits and privileges of
the District and of the Registered Owners under or with respect to this resolution.
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(d) Enforcement of Obligations. The District hereby covenants and agrees that it will
perform its respective obligations and will enforce performance by the other parties thereto under
each of the Intergovermnental Contracts, and that it will not amend any Intergovernmental
Contract in a manner that adversely affects, in any material respect, the interests of the owners of
the Bonds.
(e) Operation of Special Events Center. From and after the completion of the Special
Events Center, the District shall cause the City, at the city's sole cost and expense, at all times
that any Bonds, Additional Revenue Bonds, Sales Tax Bonds or Additional Sales Tax Bonds are
outstanding, to operate the Special Events Center, or cause the Special Events Center to be
operated, properly as a "regional center" (as that term is defined in chapter 35.57 RCW) and as a
"tourism-related facility" (as that term is defined in chapter 67.28 RCW) and in a sound and
economical manner and shall maintain, preserve and keep the same, or cause the same to be
maintained, preserved and kept, with the appurtenances and every part and parcel thereof, in
good repair, working order and condition, and shall from time to time make, or cause to be made,
all necessary and proper repairs, replacements and renewals so that at all times the operation
thereof may be properly and advantageously conducted. The District shall cause the City to fix,
maintain and collect rates and charges for the use of the services and facilities and all
commodities sold, furnished or supplied by the Special Events Center, which shall be at optimal
levels to produce total Special Events Center Revenues that will at all times be at least sufficient
to enable the City to make City Special Events Center Payments to the District in amounts
required for the District to meet Required Debt Service, as and when the same shall become due
and payable, and to make all other payments which the District is required to make pursuant to
this resolution.
(f) Insurance. The District will cause the City to acquire and maintain insurance in
form and amounts consistent with the coverage of comparable special events center facilities and
undertakings related to said facilities as contemplated under the Interlocal Agreement and to
name the District as an additional named insured. Such insurance may, without limitation,
include self-insurance and/or pool insurance. Pursuant to the Interlocal Agreement, the City has
agreed to use reasonable efforts to have the District named as an additional insured if a license
agreement or other agreement with a user of the Special Events Center provides that the licensee
must obtain specified insurance and name the City as an additional insured.
(g) Sale Transfer or Disposition of the Special Events Center. Pursuant to the
Contingent Loan and Support Agreement, neither the City nor the District shall sell, transfer or
otherwise dispose of(each such sale, transfer or other disposition a "transfer") any of the real or
personal properties, facilities or other part of the Special Events Center that are owned by it, except
for a transfer by the City to the District, unless the conditions of paragraph (1) are satisfied and the
transfer is consistent with one or more of the subparagraphs of paragraph(2), as follows:
(1) None of the real or personal properties, facilities or other part of the Special
Events Center shall be transferred unless:
(A) the transfer (other than a transfer to the District) is carried out in a
bona fide, arm's-length transaction;
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(B) the City or the District, as applicable, receives from the transferee
consideration equal to the fair market value of the portion of the Special Events Center
transferred, for which purpose "fair market value" means the most probable price that a
property should bring in a competitive and open market under all conditions requisite to a
fair sale,the willing buyer and willing seller each acting prudently and knowledgeably; and
(C) the transfer is approved by ordinance of the City or by resolution of
the District, as applicable; and
(2) The City or the District in its discretion may carry out a transfer of facilities
or property owned by it that is consistent with one or more of the following:
(A) the facilities or property to be transferred are not material to the
operation of the Special Events Center, or shall have become unserviceable, inadequate,
obsolete or unfit to be used in the operation of the Special Events Center or are no longer
necessary, material or useful to the operation of the Special Events Center; or
(B) the Special Events Center Revenues received from the operation of
those facilities or property to be transferred during the twelve full calendar months before
the transfer was less than 10% of total Special Events Center Revenues received during that
same period.
(3) The proceeds of any transfer under this Section 17(g) shall be used (i)to
promptly redeem, or irrevocably set aside for the redemption of, the District's outstanding
Bonds, Sales Tax Bonds, Additional Revenue Bonds and/or Additional Sales Tax Bonds,
and/or(ii)to provide for all or part of the cost of capital improvements and/or additions to or
expansions of the Special Events Center and/or for other regional center or tourism-related
facilities authorized under chapters 35.57 and 67.28 RCW, as directed by the City.
Section 18. Additional Revenue Bonds.
(a) Conditions upon the Issuance of Additional Revenue Bonds. As long as any
Bonds remain outstanding, the District hereby further covenants and agrees that it will not issue
any obligations payable from District Revenue, and further that it will not issue any Additional
Revenue Bonds, except in accordance with the conditions of this section. The District hereby
reserves the right to issue Additional Revenue Bonds for any lawful purpose, including for the
purposes of paying costs of completing construction of the Special Events Center for which
Bonds have been issued previously and refunding outstanding Bonds or Additional Revenue
Bonds, as provided in this section. The District shall not issue any series of Additional Revenue
Bonds unless:
(i) the District shall not have been in Default under this resolution for the
immediately preceding 12 calendar months;
(ii) the City shall have approved the issuance of the Additional Revenue
Bonds and the Contingent Loan and Support Agreement shall have been amended as
necessary to accommodate the issuance of the Additional Revenue Bonds, including any
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increase the City's contingent loan commitment thereunder required to cover the
principal of and interest on the Additional Revenue Bonds, which approval and
amendment shall be evidenced by a certified copy of the City's approving ordinance or
resolution and a certified copy of the executed amendment of the Contingent Loan and
Support Agreement; and
(iii) the Contingent Loan and Support Agreement is in full force and effect
between the District and the City, and the City is not in default of it obligations to the
District thereunder.
(b) Refundings to Cure Pending Defaults. Nothing herein contained shall prevent the
District from issuing Additional Revenue Bonds to refund maturing Bonds or Additional
Revenue Bonds for the payment of which money is not otherwise available; provided, such
Additional Revenue Bonds shall not be issued more than three months prior to the Debt Service
Payment Date on which the payment default is otherwise expected to occur.
(c) Subordinate Lien Bonds. Nothing herein contained shall prevent the District (with
the consent of the City if required by the Contingent Loan and Support Agreement) from issuing
revenue bonds or other obligations that are a charge upon the District Revenue junior or inferior to
the payments required by this resolution to be made out of the District Revenue into the Debt
Service Fund or the Sales Tax Bond Debt Service Fund to pay and secure the payment of the Bonds,
any Additional Revenue Bonds,the Sales Tax Bonds and any Additional Sales Tax Bonds.
Section 19. Supplements and Amendments.
(a) Without Consent of Owner. The District from time to time and at any time may
adopt a resolution or resolutions supplemental hereof, which resolution or resolutions thereafter
shall become a part of this resolution, for one or more or all of the following purposes:
(i) To add to the covenants and agreements of the District in this resolution
contained and other covenants and agreements thereafter to be observed, which shall not
adversely affect in any material respect the interests of the owners of the Bonds, or to
surrender any rights or power herein reserved to or conferred upon the District.
(ii) To cure, correct or supplement any ambiguous or defective provision
contained in this resolution in regard to matters or questions arising under the resolution
as the Board may deem necessary or desirable and not inconsistent with the resolution
and which shall not adversely affect the interest of the owner of Bonds in any material
respect.
Any such supplemental resolution of the Board may be adopted without the consent of
the owner of the Bonds at any time outstanding, notwithstanding any of the provisions of this
section.
(b) With Owner's Consent. With the consent of the owners of at least 51% in
principal amount of outstanding Bonds, the Board may adopt a resolution or resolutions
supplemental hereto for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this resolution or of any supplemental resolution; provided,
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however, that no such supplemental resolution shall extend the fixed maturity of the Bonds, or
reduce the rate of interest thereon, or extend the time of payments of interest from their due date,
or reduce the amount of the principal thereof, or reduce any premium payable on the redemption
thereof without the consent of the owner of each Bond so affected.
It shall not be necessary for the consent of the owner under this subsection to approve the
particular form of any proposed supplemental resolution, but it shall be sufficient if such consent
shall approve the substance thereof.
(c) Effective Date of Modification. Upon the adoption of any supplemental
resolution pursuant to the provisions of this section, this resolution shall be deemed to be
modified and amended in accordance therewith, and the respective rights, duties and obligations
of the District under this resolution shall thereafter be determined, exercised and enforced
thereunder, subject in all respect to such modification and amendments, and all the terms and
conditions of any such supplemental resolution shall be deemed to be part of the terms and
conditions of this resolution for any and all purposes. A copy of each supplemental resolution
shall be provided to the owners of the Bonds.
Section 20. Defaults and Remedies. The District hereby finds and determines that the
deposit and disbursement of District Revenue are essential to the payment and security of the
Bonds and the failure or refusal of the District or any of its officers to perform the covenants and
obligations of this resolution may endanger the application of District Revenue and such other
money, funds and securities to the purposes herein set forth. Accordingly, the provisions of this
section are specified and adopted for the additional protection of the owners from time to time of
the Bonds. Any one or more of the following events shall constitute a "Default" under this
resolution:
(a) The District shall fail to make payment of the principal of any Bond or Additional
Revenue Bond when the same shall become due and payable whether by maturity or scheduled
redemption prior to maturity;
(b) The District shall fail to make payments of any installment of interest on any
Bond or Additional Revenue Bond when the same shall become due and payable; or
(c) The District shall default in the observance or performance of any other
covenants, conditions, or agreements on the part of the District contained in this resolution, and
such default shall have continued for a period of 90 days; provided, however, that such default
shall not constitute a Default unless the owners of at least a majority of the principal amount of
outstanding Bonds have requested a Bondowners' Trustee to declare such default as a Default.
In such case, so long as such Default shall not have been remedied, a Bondowners'
Trustee may be appointed for the Bonds by the owners of a majority in principal amount of the
Bonds of such series by an instrument or concurrent instruments in writing signed and
acknowledged by such Bondowners or by their attorneys-in-fact duly authorized and delivered to
such Trustee, notification thereof being given to the District. Any Bondowners' Trustee
appointment under the provisions of this section shall be a bank or trust company organized
under the laws of any state or a national banking association. The fees and expenses of a
50855776,6
Bondowners' Trustee shall be home by the Bondowners and not by the District. The bank or
trust company acting as a Bondowners' Trustee may be removed at any time, and a successor
Bondowners' Trustee may be appointed by the owners of a majority in principal amount of the
Bonds outstanding, by an instrument or concurrent instruments in writing .signed and
acknowledged by such Bondowners or by their attorneys-in-fact duly authorized. A separate
bondowners' trustee may be retained for each subsequent issue of Additional Revenue Bonds;
however, the same bank may represent the owners of the Bonds and the owners of Additional
Revenue Bonds in the capacity as bondowners' trustee.
The Bondowners' Trustee appointed in the manner herein provided, and each successor
thereto, is hereby declared to be a trustee for the owners of all the Bonds for which such
appointment is made and is empowered to exercise all the rights and powers herein conferred on
the Bondowners' Trustee.
A Bondowners' Trustee may, upon the happening of a Default and during the
continuance thereof, take such steps and institute such suits, actions or other proceedings in its
own name, or as trustee, all as it may deem appropriate for the protection and enforcement of the
rights of Bondowners to collect any amounts due and owing the District, or to obtain other
appropriate relief, and may enforce the specific performance of any covenant, agreement or
condition contained in this resolution. Nothing contained in this Section shall, in any event or
under any circumstances, be deemed to authorize the acceleration of maturity of principal of the
Bonds, and the remedy of acceleration is expressly denied to the owners of the Bonds under any
circumstances including, without limitation, upon the occurrence and continuance of a Default.
Any action, suit or other proceedings instituted by a Bondowners' Trustee hereunder
shall be brought in its name as trustee for the Bondowners and all such rights of action upon or
under any of the Bonds or the provisions of this resolution may be enforced by a Bondowners'
Trustee without the possession of any of said Bonds, and without the production of the same at
any trial or proceedings relating thereto except where otherwise required by law, and the
respective owners of said Bonds by taking and holding the same, shall be conclusively deemed
irrevocably to appoint a Bondowners' Trustee the true and lawful trustee to the respective
owners of said Bonds, with authority to institute any such action, suit or proceeding; to receive as
trustee and deposit in trust any sums that become distributable on account of said Bonds; to
execute any paper or documents for the receipt of such money, and to do all acts with respect
thereto that the Bondowner himself might have done in person. Nothing herein contained shall
be deemed to authorize or empower any Bondowners' Trustee to consent to accept or adopt, on
behalf of any owner of said Bonds, any plan of reorganization or adjustment affecting the said
Bonds or any right of any owner thereof, or to authorize or empower the Bondowners' Trustee to
vote the claims of the owners thereof in any receivership, insolvency, liquidation, bankruptcy,
reorganization or other proceeding to which the District shall be a party.
No owner of any one or more of the Bonds shall have any right to institute any action,
suit or proceedings at law or in equity for the enforcement of the same, unless Default shall have
happened and be continuing, and unless no Bondowners' Trustee has been appointed for such
series as herein provided, but any remedy herein authorized to be exercised by a Bondowners'
Trustee may be exercised individually by any Bondowner, in his own name and on his own
behalf or for the benefit of all Bondowners, in the event no Bondowners' Trustee has been
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appointed, or with the consent of the Bondowners' Trustee if such Bondowners' Trustee has
been appointed; provided however, that nothing in this resolution or in the Bonds shall affect or
impair the obligation of the District, which is absolute and unconditional, to pay from District
Revenue the principal of and interest on said Bonds to the respective owners thereof at the
respective due dates therein specified, or affect or impair the right of action, which is absolute
and unconditional, of such owners to enforce such payments.
The remedies herein conferred upon or reserved to the owners of the Bonds and to a
Bondowners' Trustee are not intended to be exclusive of any other remedy or remedies, and each
and every such remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute. The privileges herein
granted shall be exercised from time to time and continued so long as and as often as the
occasion therefor may arise and no waiver of any default hereunder, whether by a Bondowners'
Trustee or by the owners of Bonds, shall extend to or shall affect any subsequent default or shall
impair any rights or remedies consequent thereon. No delay or omission of the Bondowners or of
a Bondowners' Trustee to exercise any right or power accruing upon any default shall impair any
such right or power or shall be construed to be a waiver of any such default or acquiescence
therein.
Upon any such waiver, such default shall cease to exist, and any Default arising
therefrom shall be deemed to have been cured, for every purpose of this resolution; but no such
waiver shall extend to any subsequent or other default or impair any right consequent thereon.
Section 21. Approval of Bond Purchase Contract. The Purchaser has presented the Bond
Purchase Contract to the District 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 Secretary and is incorporated herein by this reference. The Board finds that entering into the
Bond Purchase Contract is in the District's best interest and therefore accepts the offer contained
therein and authorizes its execution by either the Chair, the Vice-Chair or the Secretary.
The Bonds will be printed at District expense and will be delivered to the Purchaser in
accordance with the Bond Purchase Contract, together with the approving legal opinion of Foster
Pepper PLLC, regarding the Bonds.
The Chair, Vice-Chair, Secretary and Treasurer are authorized and directed to do
everything necessary for the prompt delivery of the Bonds to the Purchaser, including, without
limitation, the execution of the Official Statement on behalf of the District, and for the proper
application and use of the proceeds of the sale thereof.
Section 22. Preliminary Official Statement Deemed Final. The Board has been provided
with copies of the Preliminary Official Statement. For the sole purpose of the Purchaser's
compliance with SEC Rule 15c2-12(b)(1), the District "deems final" that Preliminary Official
Statement as of its date, except for the omission of information as to offering prices, interest
rates, selling compensation, aggregate principal amount, principal amount per maturity, maturity
dates, options of redemption, delivery dates, ratings and other terms of the Bonds dependent on
such matters.
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Section 23. Undertaking to Provide Continuing Disclosure. To meet the requirements of
SEC Rule 15c2-12(b)(5) (the "Rule"), as applicable to a participating underwriter for the Bonds,
the District makes the following written undertaking (the "Undertaking") for the benefit of
holders of the Bonds:
(a) Undertaking to Provide Annual Financial Information and Notice of
Material Events. The District undertakes to provide or cause to be provided, either
directly or through a designated agent:
(i) To each NRMSIR and to the SID 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) To each NRMSIR or the MSRB, and to the SID, timely notice of
the occurrence of any of the following events with respect to the Bonds, if
material: (1)principal and interest payment delinquencies; (2) non-payment
related defaults; (3) unscheduled draws on debt service reserves reflecting
financial difficulties; (4) unscheduled draws on credit enhancements reflecting
financial difficulties; (5) substitution of credit or liquidity providers, or their
failure to perform; (6) adverse tax opinions or events affecting the tax-exempt
status of any tax-exempt bonds; (7) modifications to rights of holders of the
Bonds; (8) Bond calls (other than scheduled mandatory redemptions of Term
Bonds); (9) defeasances; (10) release, substitution, or sale of property securing
repayment of the Bonds; and(11)rating changes; and
(iii) To each NRMSIR or to the MSRB, and to the SID, timely notice
of a failure by the District to provide required annual financial infornation on or
before the date specified in subsection(b) of this section.
To the extent authorized by the SEC, the District may satisfy its Undertaking under this
section by transmitting the required filings using http://www.disclosurcusa.org (or such
other centralized dissemination agent as may be approved by the SEC).
(b) Type of Amnial Financial Information Undertaken to be Provided. The
annual financial information that the District undertakes to provide in subsection (a) of
this section:
(i) Shall consist of (1) annual financial statements prepared (except as
noted in the financial statements) in accordance with applicable generally accepted
accounting principles promulgated by the Government Accounting Standards Board,
as such principles may be changed fi-om 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 District they will be provided; (2)to the extent not
otherwise provided in the District's annual financial statements or in information
provided by the City pursuant to its undertaking pursuant to the Rule for the
benefit of holders of the Bonds, a summary of Special Events Center Revenues
and, so long as the Sales Tax Bonds and any Additional Sales Tax Bonds are
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outstanding, a summary of revenues provided from Sales Tax Revenue (of the
type included in the Official Statement for the Bonds under the heading
"SECURITY AND SOURCES OF PAYMENT FOR THE SALES TAX
BONDS—Sales Tax Revenues-Historical Sales Tax Receipts"); (3) a statement of
authorized, issued and outstanding bonded debt of the District; (4) a statement of
issued and outstanding debt secured by the Contingent Loan and Support
Agreement; and (5) a statement of whether or not the District has drawn on funds
of the City pursuant to Section 3 of the Contingent Loan and Support Agreement.
(ii) Shall be provided to each NRMSIR and the SID, not later than the
last day of the ninth month after the end of each fiscal year of the District
(currently, a fiscal year ending December 31), as such fiscal year may be changed
as required or permitted by Washington law, commencing with the District's
fiscal year ending December 31, 2008; and
(iii) May be provided in a single or multiple documents, and may be
incorporated by reference to other documents that have been filed with each
NRMSIR and the SID, or, if the document incorporated by reference is a "final
official statement" with respect to other obligations of the District, that has been
filed with the MSRB.
(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, NRMSIR, the SID or the MSRB, under the circumstances and in the manner
penmitted by the Rule.
The District will give notice to each NRMSIR or the MSRB, and the SID, of the
substance (or provide a copy) of any amendment to the Undertaking and a brief statement
of the reasons for the amendment. If the amendment changes the type of annual financial
information to be provided, the annual financial information containing the amended
financial information will include a narrative explanation of the effect of that change on
the type of information to be provided.
(d) Beneficiaries. The Undertaking evidenced by this section shall inure to the
benefit of the District and any holder of Bonds, and shall not inure to the benefit of or
create any rights in any other person.
(e) Termination of Undertaking. The District's obligations under this
Undertaking shall terminate upon the legal defeasance of all of the Bonds. In addition,
the District's obligations tinder this Undertaking shall terminate if those provisions of the
Rule which require the District to comply with this Undertaking become legally
inapplicable in respect of the Bonds for any reason, as confirmed by an opinion of
nationally recognized bond counsel or other counsel familiar with federal securities laws
delivered to the District, and the District provides timely notice of such termination to
each NRMSIR or the MSRB and the SID.
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(t) Remedy for Failure to Comply with Undertaking. As soon as practicable
after the District learns of any failure to comply with the Undertaking, the District will
proceed with due diligence to cause such noncompliance to be corrected. No failure by
the District 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 District or other obligated person
to comply with the Undertaking.
(g) Designation of Official Responsible to Administer Undertaking. The
Treasurer (or such other officer of the District 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 District in respect of the Bonds set forth in this section and in
accordance with the Rule, including, without limitation, the following actions:
(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, if material,
preparing and disseminating notice of its occurrence;
(iii) Determining whether any person other than the District is an
"obligated person" within the meaning of the Rule with respect to the Bonds, and
obtaining from such person an undertaking to provide any annual financial
information and notice of material events for that person in accordance with the
Rule;
(iv) Selecting, engaging and compensating designated agents and
consultants, including but not limited to financial advisors and legal counsel, to
assist and advise the District in carrying out the Undertaking; and
(v) Effecting any necessary amendment of the Undertaking.
Section 24. Bond Insurance . [OMTf IF NO BOND INSURANCE OR UPDATE IF
THERE IS BOND INSURANCE] The District is authorized to purchase from the 2008 Bond
Insurer the 2008 Bond Insurance Policy insuring the prompt payment of the principal of and interest
on the Bonds and agrees to the conditions for obtaining that policy, including the payment of the
premium therefor. Any notice required to be given to the Bond Insurer shall be sent by certified or
registered mail to [Name of 2008 Bond Insurer], [Address].
While the 2008 Bond Insurance Policy is in effect, the District or the Bond Registrar shall
furnish to the 2008 Bond Insurer(to the attention of the [Surveillance Department], unless otherwise
indicated):
(a) As soon as practicable after the filing thereof, copies of any financial
statements, audits and annual reports of the District;
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(b) copies of any notices given to the registered owners of the Bonds,
including, without limitation, notices of any redemption of or defeasance of Bonds,
and any certificate rendered pursuant to this resolution relating to the security for the
Bonds at no cost to the 2008 Bond Insurer;
(c) to the extent that the District has entered into a continuing disclosure
agreement with respect to the Bonds, the 2008 Bond Insurer shall be included as a
party to be notified; and
(d) such additional information the 2008 Bond Insurer may reasonably
request.
The Bond Registrar shall notify the 2008 Bond Insurer of any failure of the District to
provide relevant notices and certificates.
The District will permit the 2008 Bond Insurer to discuss the affairs, finances and accounts
of the District or any information the 2008 Bond Insurer may reasonably request regarding the
security for the Bonds with appropriate officers of the District. The Bond Registrar and the District
will permit the 2008 Bond Insurer to have access to and make copies of all books and records
relating to the Bonds at any reasonable time.
Section 25. Pent Procedures Under 2008 Bond Insurance Policy . The Bond Insurer
requires that the following sections be included in this resolution:
[TO BE PROVIDED BY INSURER,IF TIERE'S INSURANCE]
Section 26. Parties Interested Herein. [To the extent that this resolution confers upon or
gives or grants to the 2608 Bond hisurer any right,remedy or claim under or by "reason of this
resolution, the 2008 Bond Insurer is explicitly recognized as being a third-party beneficiary
hereunder and may enforce any such right,remedy or claim conferred, given or granted hereunder.]
Nothing expressed or implied in this resolution is intended or shall be construed to confer upon, or
to give or grant to, any person or entity, other than the District, [the 2008 Bond Insurer] and the
registered owners of the Bonds, any right, remedy or claim under or by reason of this resolution or
any covenant, condition or stipulation hereof, and all covenants, stipulations, promises and
agreements in this resolution contained by and on behalf of the District shall be for the sole and
exclusive benefit of the District, [the 2008 Bond Insurer] and the registered owners of the Bonds.
[Notwithstanding any other provision of thus resolution, the District shall notify the 2008
Bond Insurer immediately if at any time there are insufficient funds to make any payments of
principal and/or interest:as required and immediately upon the occurrence of any;event of default
hereunder. Anything in this resolution to the contrary notwithstanding,upon the occurrence and
continuance of an event of default, the 2008 Bond Insurer shall be entitled to control and direct the
enforcement of all rights and remedies granted to the Bond owners for the benefit of the Bond
owners under this resolution.]
[Any provision of this resolution expressly recognizing or granting rights in or to the 2008
Bond Insurer may not be amended in any manner which affects ilic rights of the 2008 Bond Insurer
hereunder without the prior written consent of the 2008 Bond Insurer. The 2008 Bond Insurer
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508559]6.6
reserves the right to charge the District a reasonable fee for any such consent or amendment to this
resolution while the 2008 Bond Insurance Policy is outstanding, Unless otherwise provided in this
section,the 2008 Bond Insurer's consent shall be required, in addition to Bond owner consent,when
required, for the following purposes: (i) execution and delivery of any supplemental resolution, and
(ii)`initiation or approval of any other action which requires Bond owner consent.]
[Any reorganization or liquidation plan with respect to the District must be acceptable to the
2008 Bond Insurer. In the event of any reorganization or liquidation, the 2008 Bond Insurer shall
have the right to vote on behalf of all Bond owners;who hold 2008 Bond Insurer-insured bonds
absent a default by the 2008 Bond Insurer,under the 2008 Bond Insurance Policy insuring such
bonds.]
ADOPTED by the Board of Directors of the City of Dent Special Events Center Public
Facilities District at a special open public meeting thereof held this 20th day of February, 2008,
the following Directors being present and voting in favor of the resolution.
CITY OF DENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Chair and Board Member
Secretary and Board Member
Board Member
Board Member
Board Member
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CERTIFICATION
I, the undersigned, as Secretary of the City of Kent Special Events Center Public
Facilities District(the"District"),hereby certify as follows:
1. The foregoing Resolution No. 2008-3 (the "Resolution") is a full, true and
correct copy of the Resolution duly adopted at a special meeting of the District's Board of
Directors held at the regular meeting place thereof on February 20, 2008, as that Resolution
appears on the minute book of the District;
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 of Directors by mail or by
personal delivery at least 24 hours prior to the special meeting, a true and complete copy of
which notice is attached hereto as Appendix 1;
3. No local radio or television stations, or newspapers of general circulation, have
on file with the District a written request to be notified of any special meetings; [OR] 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-District a written request to be
notified of';special meetings, or to which such notice customarily is given; [PLEASE
CONFIRM]
4. A quorum was present throughout the meeting and a sufficient number of
members of the Board of Directors voted in the proper manner for the adoption of the
Resolution.
IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of February,
2008.
CITY OF KENT SPECIAL EVENTS CENTER
PUBLIC FACILITIES DISTRICT
Secretary
50855/16.6