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HomeMy WebLinkAboutRes1996-102 , , , Sponsored by: Garzini CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, PROVIDING FOR THE ISSUANCE AND SALE OF GENERAL OBLIGATION BONDS OF THE CITY OF SEWARD IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $7,500,000 TO PAY THE COSTS OF HEALTH CARE CENTER CAPITAL IMPROVEMENTS, FIXING CERTAIN DETAILS OF SUCH BONDS, PROVIDING FOR THE FORM AND MANNER OF THEIR SALE, PLEDGING THE FULL FAITH AND CREDIT OF THE CITY TO THE PAYMENT THEREOF, AND PROVIDING FOR RELATED MATTERS WHEREAS, pursuant to Resolution No. 96-048, adopted on April 15, 1996, the following Proposition 1 was submitted to the qualified voters of the City of Seward (the "City") at a special City election held on May 21, 1996: Shall the City of Seward incur debt and issue general obligation bonds not to exceed $7,500,000 for the purpose of paying a portion of the costs of constructing and acquiring health care center capital improvements within the City, and shall the City enter into an agreement with the Sisters of Providence in Washington, dba Providence Alaska Medical Center, for the lease of Seward General Hospital and the construction, lease and operation of a new health care center, substantially on the terms contained in the Proposed Alliance between the City and Sisters of Providence in Washington dba Providence Alaska Medical Center, approved in Resolution No. 96-040 of the City? The bonds shall be secured by a pledge of the full faith and credit of the City. It is expected that annual payments of principal and interest on the bonds will not exceed the annual amount to be received by the City from the one percent sales tax levied by City Ordinance No. 507, which was ratified by the qualified voters ofthe City on April 20, 1982. and said Proposition 1 was approved by a majority ofthe qualified voters voting on the question by a vote of 390 yes and 156 no, said election having been duly canvassed and the results thereof certified and confirmed in accordance with law; and $7,500,000 principal amount of general obligation bonds remains unissued under Proposition 1; and WHEREAS, Section 29.47.410 of the Alaska Statutes provides that the Council by ordinance or resolution may provide for the form and manner of sale of bonds and notes; and WHEREAS, the Council finds that it is in the best interest of the City to plan, design, acquire property for, acquire, construct, install and equip the health care center capital improvements CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 within the City described in Proposition 1 (the "Project"), and issue not to exceed $7,500,000 principal amount of the general obligation bonds referred to in Proposition 1, constituting all of the unsold general obligation bonds referred to therein, to pay costs of the Project; and WHEREAS, there has been presented to the City the form of a Loan Agreement between the Alaska Municipal Bond Bank and the City, which provides for the Alaska Municipal Bond Bank to purchase the bonds on the terms and conditions set forth therein and in this resolution, and it is in the best interest ofthe City that the City sell the bonds to the Alaska Municipal Bond Bank under such terms and conditions; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: Section 1. Definitions. The following terms shall have the following meanings in this resolution: (a) "Bond" or "Bonds" means any of the bonds ofthe City, the issuance and sale of which are authorized herein as the evidence of the indebtedness referred to in Proposition 1. (b) "Bond Bank" means the Alaska Municipal Bond Bank. (c) "Bond Bank Bonds" means the bonds of the Bond Bank issued to provide funds to purchase the Bonds. (d) "Bond Register" means the registration books maintained by the Registrar, which include the names and addresses of the owners or nominees of the Registered Owners of the Bonds. (e) "City" means the City of Seward, Alaska, a municipal corporation of the state of Alaska, organized as a home rule city under Title 29 of the Alaska Statutes. (f) "Code" means the Internal Revenue Code of 1986, as amended from time to time, together with all regulations applicable thereto. (g) "Cost" or "Costs" means the cost of planning, designing, acquiring property for, acquiring, constructing, installing and equipping the Project, including interest on the Bonds during the period of planning, designing, acquiring property for, acquiring, constructing, installing and equipping the Project, the cost whether incurred by the City or by another of field surveys and advance planning undertaken in connection with the Project properly allocable to the Project, the cost of acquisition of any land or interest therein required as the site or sites of the Project or for use Page No.2 of 12 , , , CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 in connection therewith, the cost of any indemnity and surety bonds and premiums on insurance incurred in connection with the Project prior to or during construction thereof, all related direct administrative and inspection expenses whether incurred by the City or by another in connection with the Project prior to or during construction thereof and allocable portions of direct costs of the City, legal fees, costs of issuance of the Bonds by the City, including financing charges and fees and expenses of bond counsel, financial advisors and consultants in connection therewith, the cost of any bond insurance premium, the cost of audits, the cost of all machinery, apparatus and equipment, cost of engineering, architectural services, designs, plans, specifications and surveys, estimates of cost, the reimbursement of all moneys advanced from whatever source for the payment of any item or items of cost of the Project, and all other expenses necessary or incidental to determining the feasibility or practicability of the Project, and such other expenses not specified herein as may be necessary or incidental to the acquisition and development of the Project, the financing thereof and the putting of the same in use and operation. (h) "Council" means the Council of the City, as the general legislative authority of the City, as the same shall be duly and regularly constituted from time to time. (i) "Loan Agreement" means the Loan Agreement between the City and the Bond Bank, dated as of the date of the Bonds. (j) "Registered Owner" means the person named as the registered owner of a Bond in the Bond Register. (k) "Registrar" means the Finance Director of the City, or any successor that the City may appoint by resolution. Section 2. Authorization of Bonds and Purpose ofIssuance. For the purpose of providing part of the funds required to pay the Costs of the Project, to provide for original issue discount, if any, and to pay all costs incidental thereto and to the issuance of the Bonds, the City hereby authorizes and determines to issue and sell the Bonds in the aggregate principal amount of not to exceed $7,500,000. Section 3. Obligation of Bonds. The Bonds shall be direct and general obligations of the City and the full faith and credit of the City are hereby pledged to the payment of the principal of and interest on the Bonds. The City hereby irrevocably pledges and covenants that it will levy and collect taxes upon all taxable property within the City without limitation as to rate or amount, in amounts sufficient, together with other funds legally available therefor, to pay the principal of and interest on the Bonds as the same become due and payable. Page No.3 of 12 CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 Section 4. Designation, Maturities, Interest Rates and Other Details of Bonds. The Bonds shall be designated "City of Seward, Alaska, General Obligation Bonds, 1996 Series A." The Bonds shall be dated September 1,1996, shall be in the denomination of $5,000 or any integral multiple thereof, and shall be nwnbered separately in the manner and with such additional designation as the Registrar deems necessary for purposes of identification, and may have endorsed thereon such legends or text as may be necessary or appropriate to conform to the rules and regulations of any governmental authority or any usage or requirement of law with respect thereto. The Bonds shall mature on October 1 in each of the years, and in the maximwn principal amounts, as follows: Maturity Principal Amount 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 $ 175,000.00 205,000.00 235,000.00 265,000.00 300,000.00 340,000.00 380,000.00 425,000.00 470,000.00 520,000.00 570,000.00 630,000.00 690,000.00 755,000.00 825,000.00 715,000.00 The exact principal amount of each maturity of the Bonds shall be fixed and determined by the City Manager upon the sale of the Bond Bank Bonds, provided that no principal amount of a maturity shall exceed the principal amount of the corresponding maturity of the Bond Bank Bonds. The Bonds shall bear interest from the date thereof, payable on April l, 1996 and semiannually thereafter on October 1 and Aprill of each year. The City Manager is authorized to fix and determine the rate of interest on each maturity of the Bonds, provided that (i) no rate of interest on a maturity shall exceed the rate of interest on the corresponding maturity of the Bond Page No.4 of 12 , , , CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 Bank Bonds; and (ii) the true interest cost of the Bonds shall not exceed 8% unless approved by resolution of the Council. Section 5. Payment of Principal and Interest. The Bonds shall be payable in lawful money of the United States of America which at the time of payment is legal tender for the payment of public and private debts. For so long as all outstanding Bonds are registered in the name of the Alaska Municipal Bond Bank, payments of principal and interest thereon shall be made as provided in the Loan Agreement. In the event that the Bonds are no longer owned by the Bond Bank, payment of interest on the Bonds shall be made by check or draft mailed by first class mail to the Registered Owner of record as of the fifteenth day of the month preceding each interest payment date at the address appearing on the Bond Register, and principal of the Bonds will be payable at the office of the Registrar upon presentation and surrender of the Bonds representing such principal. Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months. Section 6. Optional Redemption. The Bonds maturing on and after October I, 2007 are subject to redemption prior to maturity at the option of the City on any date on or after October I, 2006, either as a whole or in part and from such maturities as the City shall determine, and by lot within a maturity, at a redemption price equal to the principal amount of the Bonds to be redeemed plus accrued interest to the date of redemption. Section 7. Form of Bond. Each Bond shall be in substantially the following form, subject to the provisions of the Loan Agreement. UNITED STATES OF AMERICA STATE OF ALASKA CITY OF SEWARD (A Municipal Corporation of the State of Alaska) NO. $ GENERAL OBLIGATION BOND 1996 SERIES A REGISTERED OWNER: PRINCIPAL AMOUNT: The City of Seward, Alaska (the "City"), a municipal corporation of the State of Alaska, hereby acknowledges itself to owe and for value received promises to pay to the Registered Owner identified above, or its registered assigns, the Principal Amount indicated above in the following Page No.5 of 12 CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 installments on I of each of the following years, and to pay interest on such installments from the date hereof, payable on I, 1996 and semiannually thereafter on the I st days of and of each year, at the rates per annum as follows; Year Principal Amount Interest Rate For so long as this Bond is owned by the Alaska Municipal Bond Bank (the "Bank"), payment of principal and interest shall be made as provided in the Loan Agreement between the Bank and the City (the "Loan Agreement"). In the event that this Bond is no longer owned by the Bank, principal will be payable, when due, upon surrender hereof at the office of the Registrar, and interest will be payable on each interest payment date by check or draft mailed by first class mail to the registered owner as of the close of business on the fifteenth day of the month preceding each interest payment date. Interest shall be computed on the basis of a 360-day year consisting of twelve 30-day months. Both principal of and interest on this bond are payable in lawful money of the United States of America which, on the respective dates of payment thereof, shall be legal tender for the payment of public and private debts. This Bond is one of the General Obligation Bonds, 1996 Series A of the City of Seward, Alaska of like tenor and effect except as to interest rate, serial number and maturity, aggregating $7,500,000 in principal amount, and constituting bonds authorized for the purpose of paying the cost of health care center capital improvements in the City, and is issued under Resolution No. 96-0_ of the City entitled: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, PROVIDING FOR THE ISSUANCE AND SALE OF GENERAL OBLIGATION BONDS OF THE CITY OF SEWARD IN THE AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $7,500,000 TO PAY THE COSTS OF HEALTH CARE CENTER CAPITAL IMPROVEMENTS, FIXING CERTAIN DETAILS OF SUCH BONDS, PROVIDING FOR THE FORM AND MANNER OF THEIR SALE, PLEDGING THE FULL FAITH AND CREDIT OF THE CITY TO THE PAYMENT THEREOF, AND PROVIDING FOR RELATED MATTERS. (herein called the "Resolution"). The Bonds maturing on and after I, 20_ are subject to redemption prior to maturity at the option of the City on any date on or after I, 20_, either as a whole or in part and from such maturities as the City shall determine, and by lot within a maturity, at a redemption price equal to the principal amount of the Bonds to be redeemed plus accrued interest to the date of redemption. Page No.6 of 12 r , , CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 This Bond is transferable as provided in the Resolution, (i) only upon the bond register of the City, and (ii) upon surrender of this Bond together with a written instrument of transfer duly executed by the registered owner or the duly authorized attorney of the registered owner, and thereupon a new fully registered Bond or Bonds in the same aggregate principal amount and maturity shall be issued to the transferee in exchange therefor as provided in the Resolution and upon the payment of charges, if any, as therein prescribed. The City may treat and consider the person in whose name this Bond is registered as the absolute owner hereof for the purpose of receiving payment of, or on account of, the principal or redemption price, if any, hereof and interest due hereon and for all other purposes whatsoever. This Bond is a general obligation of the City of Seward, and the full faith and credit ofthe City are pledged for the payment of the principal of and interest on the Bond as the same shall become due. IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts or things required by the constitution or statutes of the State of Alaska and the home rule charter of the City to exist, to have happened or to have been performed precedent to or in the issuance of this Bond exist, have happened and have been performed, and that the series of Bonds of which this is one, together with all other indebtedness of the City, is within every debt and other limit prescribed by said constitution, statutes or charter. IN WITNESS WHEREOF, THE CITY OF SEWARD, ALASKA, has caused this Bond to be signed in its name and on its behalf by its Mayor and its corporate seal to be hereunto impressed or otherwise reproduced and attested by its Clerk, all as ofthe day of 1996. CITY OF SEWARD By: LOUIS A. BENCARDINO Mayor ATTEST: LINDA S. MURPHY, CMC/AAE Page No.7 of 12 CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 City Clerk (CITY SEAL) Section 8. Execution. The Bonds shall be executed in the name of the City by the Mayor, and its corporate seal shall be impressed or otherwise reproduced thereon and attested by the City Clerk. The execution of a Bond on behalf of the City by persons that at the time of the execution are duly authorized to hold the proper offices shall be valid and sufficient for all purposes, although any such person shall have ceased to hold office at the time of delivery of the Bond or shall not have held office on the date of the Bond. Section 9. Registration. (a) The Bonds shall be issued only in registered form as to both principal and interest. The City designates the City Finance Director as Registrar for the Bonds. The Registrar shall keep, or cause to be kept, the Bond Register at the principal office ofthe City. (b) The City, in its discretion, may deem and treat the Registered Owner of each Bond as the absolute owner thereof for all purposes, and neither the City nor the Registrar shall be affected by any notice to the contrary. Payment of any such Bond shall be made only as described in Section 5, but such registration may be transferred as herein provided. All such payments made as described in Section 5 shall be valid and shall satisfy and discharge the liability ofthe City upon such Bond to the extent of the amount or amounts so paid. (c) Bonds shall be transferred only upon the Bond Register kept by the Registrar. Upon surrender for transfer or exchange of any Bond at the office of the Registrar, with a written instrument of transfer or authorization for exchange in form and with guaranty of signature satisfactory to the Registrar, duly executed by the registered owner or its duly authorized attorney, the City shall execute and the Registrar shall deliver an equal aggregate principal amount of Bonds of the same maturity of any authorized denominations, subject to such reasonable regulations as the Registrar may prescribe and upon payment sufficient to reimburse it for any tax, fee or other governmental charge required to be paid in connection with such transfer or exchange. All Bonds surrendered for transfer or exchange shall be canceled by the Registrar. The Registrar shall not be required to transfer or exchange any Bond after the Bond has been called for redemption. (d) The City covenants that, until all Bonds have been surrendered and canceled, it will maintain a system for recording the ownership of each Bond that complies with the provisions of Section 149 of the Code. Section 10. Mutilated, Destroyed, Stolen or Lost Bonds. Upon surrender to the Registrar of a mutilated Bond, the City shall execute and deliver a new Bond of like maturity and principal amount. Upon filing with the Registrar of evidence satisfactory to the City that a Bond has been Page No.8 of 12 r , , CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 destroyed, stolen or lost and of the ownership thereof, and upon furnishing the City with indemnity satisfactory to it, the City shall execute and deliver a new Bond of like maturity and principal amount. The person requesting the authentication and delivery of a new Bond pursuant to this section shall comply with such other reasonable regulations as the City may prescribe and pay such expenses as the City may incur in connection therewith. Any Bonds issued pursuant to this section in substitution for Bonds alleged to be destroyed, stolen or lost shall constitute original additional contractual obligations on the part ofthe City, whether or not the Bonds alleged to be destroyed, stolen or lost be at any time enforceable by anyone. Section 11. Disposition ofthe Sale Proceeds ofthe Bonds. The sale proceeds of the Bonds representing accrued interest on the Bonds shall be applied to pay a portion of the interest due on the Bonds on April 1 , 1997. An amount of sale proceeds of the Bonds that the City Manager determines to be sufficient to pay interest on the Bonds through October 1, 1997, may be applied to pay such interest, and may be deposited in the appropriate fund or account of the City for such purpose. The remainder of the sale proceeds of the Bonds shall be applied to pay costs of the Project and issuance costs of the Bonds, and shall be deposited in the appropriate fund or account of the City for such purposes. Section 12. Tax Covenants. The City covenants to comply with any and all applicable requirements set forth in the Code in effect from time to time to the extent that such compliance shall be necessary for the exclusion of the interest on the Bonds from gross income for federal income tax purposes. The City covenants that it will make no use of the proceeds of the Bonds which will cause the Bonds to be "arbitrage bonds" subject to federal income taxation by reason of Section 148 of the Code. The City covenants that it will not take or permit any action that would cause the Bonds to be "private activity bonds" as defined in Section 141 of the Code. Section 13. Sale of Bonds; Loan Agreement. The sale of not to exceed $7,500,000 aggregate principal amount of the Bonds, as provided in the Loan Agreement and this resolution, is hereby authorized and approved. The City Manager is hereby authorized to execute and deliver the Loan Agreement on behalf of the City. Section 14. Authority of Officers. The Mayor, the acting Mayor, the City Manager, the acting City Manager, the City Clerk and the acting City Clerk are, and each of them hereby is, authorized and directed to do and perform all things and determine all matters not determined by this resolution, to the end that the City may carry out its obligations under the Bonds and this resolution. Section 15. Amendatory and Supplemental Resolutions. Page No.9 of 12 CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 (a) The Council 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 anyone or more of the following purposes: (1) To add to the covenants and agreements of the City in this resolution, other covenants and agreements thereafter to be observed, or to surrender any right or power herein reserved to or conferred upon the City. (2) To make such provisions for the purpose of curing any ambiguities or of curing, correcting or supplementing any defective provision contained in this resolution or in regard to matters or questions arising under this resolution as the Council may deem necessary or desirable and not inconsistent with this resolution and which shall not adversely affect the interests of the Registered Owners of the Bonds. Any such supplemental resolution may be adopted without the consent of the Registered Owner of any of the Bonds at any time outstanding, notwithstanding any of the provisions of subsection (b) ofthis section. (b) With the consent of the Registered Owners of not less than 60 percent in aggregate principal amount of the Bonds at the time outstanding, the Council 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: (I) extend the fixed maturity of any of the Bonds, or reduce the rate of interest thereon, or reduce the amount or change the date of any sinking fund installment, 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 owners of each Bond so affected; or (2) reduce the aforesaid percentage of owners of Bonds required to approve any such supplemental resolution without the consent of the owners of all of the Bonds then outstanding. It shall not be necessary for the consent ofthe Registered Owners of the Bonds under this subsection to approve the particular form of any proposed supplemental resolution, but it shall be sufficient if such consent approves the substance thereof. ( c) Upon the adoption of any supplemental resolution under this section, this resolution shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under this resolution of the City and all Registered Owners of outstanding Bonds Page No. 10 of 12 , , , CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 shall thereafter be subject in all respects to such modification and amendment, and all the terms and conditions of the supplemental resolution shall be deemed to be part of the terms and conditions of this resolution for any and all purposes. (d) Bonds executed and delivered after the effective date of any supplemental resolution adopted under this section may bear a notation as to any matter provided for in such supplemental resolution, and if such supplemental resolution shall so provide, new Bonds modified so as to conform, in the opinion of the City, to any modification of this resolution contained in any such supplemental resolution may be prepared by the City and delivered without cost to the Registered Owners of the Bonds then outstanding, upon surrender for cancellation of such Bonds in equal aggregate principal amounts. Section 16. Miscellaneous. (a) All payments made by the City of, or on account of, the principal of or interest on the Bonds shall be made on the several Bonds ratably and in proportion to the amount due thereon, respectively, for principal or interest as the case may be. (b) No recourse shall be had for the payment of the principal of or the interest on the Bonds or for any claim based thereon or on this resolution against any member of the Councilor officer of the City or any person executing the Bonds. The Bonds are not and shall not be in any way a debt or liability of the State of Alaska or of any political subdivision thereof, except the City, and do not and shall not create or constitute an indebtedness or obligation, either legal, moral or otherwise, of said state or of any political subdivision thereof, except the City. Section 17. Continuing Disclosure. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate attached hereto as Exhibit A. Notwithstanding any other provision of this resolution, failure of the City to comply with the Continuing Disclosure Certificate shall not be considered a default of the City's obligations under this resolution or the Bonds; however, the beneficial owner of any Bond may bring an action for specific performance, to cause the City to comply with its obligations under this Section. Section 18. Severability. If anyone or more of the provisions of this resolution shall be declared by any court of competent jurisdiction to be contrary to law, then such provision shall be null and void and shall be deemed separable from the remaining provisions of this resolution and shall in no way affect the validity of the other provisions of this resolution or ofthe Bonds. Section 19. Reimbursement Allocation. The City intends to allocate proceeds of the Bonds to reimburse expenditures for Costs of the Project incurred prior to the issue date of the Bonds. Page No. 11 of 12 CITY OF SEWARD, ALASKA RESOLUTION NO. 96-102 Section 20. Posting, Publication, Effective Date. Upon adoption of this resolution, the City Clerk shall cause a true copy of the same to be posted on the City Hall bulletin board and notice of the same to be published as provided in Seward City Code ~2.15.035(D). This resolution shall become effective upon passage and approval in accordance with Seward City Code ~2.15.050(C). PASSED AND APPROVED by the City Council of the city of Seward, Alaska, this 19th day of August, 1996. THE CITY OF SEWARD, ALASKA AYES: NOES: ABSENT: ABSTAIN: Anderson, Bencardino, Deeter, Keil, King, Sieminski None Crane None ATTEST: . ~ \,1I .. ') ,.:c., c' "14 .. " ,~7~ ":. " 7:' :~::t\.:~:::'~/:~~/ l.r;. 'I',"",~ .' .': ~ w 2;,. Page No. 12 of 12 , , , EXHIBIT A CONTINUING DISCLOSURE CERTIFICATE The City of Seward (the "Municipality") executes and delivers this Continuing Disclosure Certificate (the "Disclosure Certificate") in connection with the issuance of $7,705,000 Alaska Municipal Bond Bank General Obligation Bonds, 1996 Series B (the "Bonds"). The Bonds are being issued under the General Bond Resolution of the Issuer adopted May 27,1976, as amended, (the "General Resolution") and a Resolution of the Issuer entitled, "A Series Resolution Authorizing The Issuance Of General Obligation Bonds 1996 Series B Of The Alaska Municipal Bond Bank," adopted August 6, 1996 (together with the General Resolution, the "Resolutions"). The Municipality covenants and agrees as follows: Section 1. Puroose of the Disclosure Certificate. The Municipality is executing and delivering this Disclosure Certificate for the benefit of the registered owners and beneficial owners of the Bonds, and to assist the Participating Underwriters in complying with S.E.C. Rule 15c2~12(b)(5). Section 2. Definitions. In addition to the definitions set forth in the Resolutions, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: "Annual Report" means any Annual Report provided by the Municipality pursuant to, and as described in, Section 3 of this Disclosure Certificate. "Fiscal Year" means the fiscal year of the Municipality (currently the 12-month period ending June 30), as such fiscal year may be changed from time to time as required by State law and the Municipality's ordinances. "NRMSIR" means any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. The current NRMSIRs are listed in Attachment A. "Participating Underwriter" means any of the original underwriters of the Bonds required to comply with the Rule in connection with the offering of the Bonds. "Repository" means each NRMSIR and the SID. "Rule" means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended from time to time. "SID" means any public or private repository or entity designated by the State of Alaska as a state depository for the purposes of the Rule. Currently there is no SID. Disclosure Certificate AFF0537513742.1643 Page 1 of 3 Section 3. Provision of Annual Reoorts and Financial Statements. Commencing with its Fiscal Year ending June 30, 1996, the Municipality will provide to each Repository: (a) Not later than 180 days after the end of each Fiscal Year, an Annual Report for the Fiscal Year. The Annual Report shall contain or incorporate by reference annual financial statements for the Municipality, prepared in accordance with generally accepted accounting principles applicable to governmental entities, as such principles may be changed from time to time. Any or all of these items may be incorporated by reference from official statements of debt issues of the Municipality that are available from the Municipal Securities Rulemaking Board, and from other documents which have been submitted to the Repositories or the Securities and Exchange Commission. The Municipality shall clearly identify each such other document so incorporated by reference. The Annual Report may be submitted as a single document or as separate documents comprising a package, provided that audited financial statements of the Municipality may be submitted separately from the remainder of the Annual Report. (b) Promptly upon their public release, the audited financial statements of the Municipality for each Fiscal Year, prepared in accordance with generally accepted accounting principles applicable to governmental entities, as such principles may be changed from time to time. Section 4. Notice of Failure to Provide Information. The Municipality shall provide in a timely manner to each' Repository notice of any failure to satisfy the requirements of Section 3 of this Disclosure Certificate. Section 5. Termination of Reoortina Obliaation. The Municipality's obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. Section 6. Amendment: Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Municipality may amend this Disclosure Certificate, provided that the amendment meets each of the following conditions: (a) The amendment is made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of the Municipality; (b) This Disclosure Certificate, as amended, would have complied with the requirements of the Rule as of the date hereof, after taking into account any amendments or interpretations of the Rule, as well as any changes in circumstances; and (c) The Municipality obtains an opinion of counsel unaffiliated with the Issuer Disclosure Certificate AFF0537513742.1643 Page 2 of 3 , , , that the amendment does not materially impair the interests of the Beneficial Owners of the Bonds. Any such amendment may be adopted without the consent of any Beneficial Owner of any of the Bonds, notwithstanding any other provision of this Disclosure Certificate or the Resolutions. The first Annual Report containing amended operating data or financial information pursuant to an amendment of this Disclosure Certificate shall explain, in narrative form, the reasons for the amendment and its effect on the type of operating data and financial information being provided. Section 7. Default. In the event of a failure of the Municipality to comply with any provision of this Disclosure Certificate, any Beneficial Owner may take such actions as may be necessary and appropriate, including an action to compel specific performance, to cause the Municipality to comply with its obligations under this Disclosure Certificate. No failure to comply with any provision of this Disclosure Certificate shall be deemed an Event of Default under the Resolutions, and the sole remedy under this Disclosure Certificate in the event of any failure of the Municipality to comply with this Disclosure Certificate shall be an action to compel specific performance. Section 8. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Municipality, the Alaska Municipal Bond Bank, the Trustee, the Participating Underwriters and the Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity. DATED this day of August, 1996. CITY OF SEWARD LOUIS BENCARDINO Mayor ATTEST: Linda Murphy City Clerk [SEAL] Disclosure Certificate AFF0537513742.1643 Page 3 of 3 ATTACHMENT A -- NRMSIRs 1. Bloomberg Municipal Repository P.O. Box 840 Princeton, NJ 08542-0840 Phone: (609) 279-3200 Fax: (609) 279-5962 2. Donnelley Financial Municipal Securities Disclosure Archive 559 Main Street Hudson, MA 01749 Phone: (800) 580-3670 Fax: (508) 562-1969 3. Disclosure, Inc. 5161 River Road Bethesda, MD 20816 Attn: Document Acquisitions/Municipal Securities Phone: (301) 951-1450 (for issuer-related questions) (800) 638-8241 (for purchase of documents) Fax: (301) 718-2329 4. Kenny Information Systems, Inc. 65 Broadway, 16th Floor New York, NY 10006 Attn: Kenny Repository Service Phone: (212) 770-4595 Fax: (212) 797-7994 5. Moody's NRMSIR Public Finance Information Center 99 Church Street New York, NY 10007 Phone: (800) 339-6306 Fax: (212) 553-1460 6. Thompson NRMSIR 395 Hudson Street New York, NY 10014 Attn: Municipal Disclosure Phone: (212) 807-5001 (800) 689-8466 Fax: (212) 989-2078 Exhibit A Page A-1 , , , LOAN AGREEMENT AGREEMENT, dated as of the _ day of 1996, between the Alaska Municipal Bond Bank (the "Bank"), a body corporate and politic constituted as an instrumentality of the State of Alaska (the "State") exercising public and essential governmental functions, created pursuant to the provisions of Chapter 85, Title 44, Alaska Statutes, as amended (the "Act"), having its principal place of business at Anchorage, Alaska, and the City of Seward, Alaska, a duly constituted home rule city of the State (the "Municipality"): WIT N E SSE T H: WHEREAS, pursuant to the Act, the Bank is authorized to make loans of money (the "Loan" or "Loans") to governmental units; and WHEREAS, the Municipality is a Governmental Ullit as defined in the General Bond Resolution of the Bank hereinafter mentioned and pursuant to the Act is authorized to accept a Loan from the Bank to be evidenced by its municipal bonds purchased by the Bank; and WHEREAS, the Municipality is desirous of borrowing money from the Bank in the amount of $7,500,000 and has submitted an application to the Bank for a Loan in such amount and the Municipality has duly authorized the issuance of its fully registered bond in the aggregate principal amount of $7,500,000 (the "Municipal Bond"), which bond is to be purchased by the Bank as evidence of the Loan in accordance with this Agreement; and WHEREAS, the application of the Municipality contains the information required by the Bank; and WHEREAS, to provide for the issuance of bonds of the Bank in order to obtain from time to time monies with which to make Loans, the Bank has adopted the General Bond Resolution on May 27, 1976, as amended (the "General Bond Resolution"), authorizing the making of such Loan to the Municipality and the purchase of the Municipal Bond; NOW, THEREFORE, the parties agree: 1. The Bank hereby makes the Loan and the Municipality accepts the Loan in the amount of $7,500,000. As evidence of the Loan made to the Municipality and such money borrowed from the Bank by the Municipality, the Municipality hereby sells to the Bank the Municipal Bond in the principal amount, with the maturities, and bearing interest from its date at the rate or rates per annum, stated in Exhibit "A" appended hereto. For purposes of this Loan Agreement the interest on the Municipal Bond will be computed without regard to the provision in Section 7 hereof for the Municipality to make funds available to the Trustee acting under the General Bond Resolution for the payment of principal and interest at least seven business days prior to each respective principal and interest payment date. 2. The Municipality represents that it has duly adopted or will adopt all necessary ordinances or resolutions and has taken or will take all proceedings required by law to enable it to enter into this Loan Agreement and issue its Municipal Bond to the Bank. 3. Subject to any applicable legal limitations, the amounts to be paid by the Municipality pursuant to this Loan Agreement representing interest due on its Municipal Bond (the "Municipal Bond Interest Payments") shall be computed at the same rate or rates of interest borne by the corresponding maturities of the bonds sold by the Bank in order to obtain the monies with which to make the Loan and to purchase the Municipal Bond (the "Loan Obligations") and, unless required under Section 7 hereof to be paid at least seven business days before the interest payment date, shall be paid by the Municipality in such manner and at such times as to provide funds sufficient to pay interest as the same becomes due on the Loan Obligations. 4. The amounts to be paid by the Municipality pursuant to this Loan Agreement representing principal due on its Municipal Bond (the "Municipal Bond Principal Payments"), unless required under Section 7 hereof to be paid at least seven business days before the maturity date, shall be scheduled by the Bank in such manner and at such times (notwithstanding the dates of payment as stated in the Municipal Bond) as to provide funds sufficient to pay the principal of the Loan Obligations as the same matures based upon the maturity schedule stated in Exhibit "A." 5. In the event the amounts referred to in Sections 3 and 4 hereof to be paid by the Municipality pursuant to this Loan Agreement are not made available at any time specified herein, the Municipality agrees that any money payable to it by any department or agency of the State may be withheld from it and paid over directly to the Trustee acting under the General Bond Resolution, and this Loan Agreement shall be full warrant, authority and direction to make such payment upon notice to such department or agency by the Bank as provided in the Act. 6. In the event Loan Obligations have been refunded and the interest rates the Bank is required to pay on its refunding bonds in any year are less than the interest rates payable by the Municipality on the Municipal Bond for the corresponding year pursuant to Section 1 hereof, then both the Municipal Bond Interest Payments and the Municipal Bond Principal Payments will be adjusted in such a manner that (i) the interest rate paid by the Municipality on any maturity of the Municipal Bond is equal to the interest rate paid by the Bank on the corresponding maturity of Bank's refunding bonds and (ii) on a present value basis the sum of the adjusted Municipal Bond Interest Payments and Municipal Bond Principal Payments is equal to or less than the sum of the Municipal Bond Interest Payments and Municipal Bond Principal Payments due over the remaining term of the Municipal Bond as previously established under this Loan Agreement. In the event of such a refunding of Loan Obligations, the Bank shall present to the Municipality for the Municipality's approval, a revised schedule of maturity amounts and interest rates for the Municipal Bond. If approved by the Municipality the AMBBlCity of Seward, General Obligation Hospital Bond, 1996 Loan Agreement AFF052E9J3742.1643 Page 2 of 9 , , , (a) Any representation, warranty or other statement made by the Municipality to the Bank in connection with its application to the Bank for a Loan shall be incorrect or incomplete in any material respect. (b) The Municipality has violated commitments made by it in the terms of this Loan Agreement. (c) The financial position of the Municipality has, in the opinion of the Bank, suffered a materially adverse change between the date of this Loan Agreement and the scheduled time of delivery of the Municipal Bond to the Bank. 13. The obligation of the Bank under this Loan Agreement is contingent upon delivery of its 1996 Series B General Obligation Bonds (the "1996 Series B Bonds") and receipt of the proceeds thereof. 14. The Municipality shall not take, or omit to take, any action lawful and within its power to take, which action or omission would cause interest on the Municipal Bond to become subject to federal income taxes in addition to federal income taxes to which interest on such Municipal Bond is subject on the date of original issuance thereof. The Municipality shall not permit any of the proceeds of the Municipal Bond, or any facilities financed with such proceeds, to be used in any manner that would cause the Municipal Bond to constitute a "private activity bond" within the meaning of Section 141 of the Code. The Municipality shall make no use or investment of the proceeds of the Municipal Bond which will cause the Municipal Bond to be an "arbitrage bond" subject to taxation by reason of Section 148 of the Code. So long as the Municipal Bond is outstanding, the Municipality, with respect to the proceeds of the Municipal Bond, shall comply with all requirements of said Section 148 and all regulations of the United States Department of Treasury issued thereunder, to the extent that such requirements are, at the time, applicable and in effect. The Municipality shall indemnify and hold harmless the Bank from any obligation of the Municipality to make rebate payments to the United States under said Section 148 arising from the Municipality's use or investment of the proceeds of the Municipal Bond. 15. The Bank shall cause to be prepared an Official Statement (the "Official Statement") for the 1996 Series B Bonds. The Municipality shall provide promptly to the Bank the information concerning the Municipality and the Municipal Bond (i) that the Bank requests for inclusion in the Official Statement, or (ii) that the Municipality considers to be material to the purposes for which the Official Statement is to be used (the "Municipal Information"). As a condition to the payment of the amount of the Loan or any portion thereof, the Municipality shall provide to the Bank a certificate, dated the date of issue of the AMBBlCity of Seward, General Obligation Hospital Bond, 1996 Loan Agreement AFF052E9I3742.1643 Page 5 of 9 1996 Series B Bonds, of an authorized officer of the Municipality that (i) the Municipal Information consists of fair and accurate statements or summaries of the matters therein set forth and such information does not contain any untrue statement of material fact or omit to state a material fact that should be stated therein for the purposes for which it is to be used or that is necessary to make the statements therein, in light of the circum- stances under which they were made, not misleading in any material respect; and (ii) to the best knowledge of such officer, no event affecting the Municipality has occurred since the date of the Official Statement that should be disclosed in the Official Statement for the purposes for which it is to be used or that it is necessary to disclose therein in order to make the statements and information therein not misleading in any material respect. The Municipality will undertake in the Disclosure Certificate for the benefit of the Beneficial Owners of the 1996 Series B Bonds to provide or cause to be provided to each nationally recognized municipal securities information repository ("NRMSIR") and to a state information depository ("SID"), if one is established in the State, annual financial information and operating data as required by Rule 15c2-12(b)(5) of the Securities and Exchange Act of 1934, as the same may be amended from time to time (the "Rule"). The Municipality will provide to each NRMSIR or to the Municipal Securities Rulemaking Board, and to the SID, timely notice of a failure by the Municipality to provide required annual financial information on or before the date specified below. The annual financial information that the Municipality will provide will consist of annual financial statements for the Municipality, prepared in accordance with generally accepted accounting principles, as such principles may be changed from time to time; and will be provided not later than 180 days after the end of each fiscal year of the Municipality, as such fiscal year may be changed from time to time, commencing with the Municipality's fiscal year ending June 30, 1997. 16. If any provision of this Loan Agreement shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such provision shall not affect any of the remaining provisions of this Loan Agreement and this Loan Agreement shall be construed and enforced as if such invalid or unenforceable provision had not been contained herein. 17. This Loan Agreement may be executed in one or more counterparts, any of which shall be regarded for all purposes as an original and all of which constitute but one and the same instrument. Each party agrees that it will execute any and all documents or other instruments, and take such other actions as are necessary, to give effect to the terms of this Loan Agreement. 18. No waiver by either party of any term or condition of this Loan Agreement shall be deemed or construed as a waiver of any other term or condition hereof, nor shall a waiver of any breach of this Loan Agreement be deemed to constitute a waiver of any subsequent breach, whether of the same or of a different section, subsection, paragraph, clause, phrase or other provision of this Loan Agreement. AMBBlCity of Seward, General Obligation Hospital Bond, 1996 Loan Agreement AFF052E9I3742.1643 Page 6 of 9 , , , revised schedule shall be attached hereto as Exhibit "A" and incorporated herein in replacement of the previous Exhibit "A" detailing said maturity amounts and interest rates. 7. The Municipality is obligated to pay to the Bank Fees and Charges. Such Fees and Charges actually collected from the Municipality shall be in an amount sufficient, together with the Municipality's Allocable Proportion of other monies available therefor under the provisions of the General Bond Resolution, and other monies available therefor, including any specific grants made by the United States of America or any agency or instrumentality thereof or by the State or any agency or instrumentality thereof and amounts applied therefor from amounts transferred to the Operating Fund pursuant to paragraph (3) of Section 603 of the General Bond Resolution: (a) to pay, as the same become due, the Municipality's Allocable Proportion of the Administrative Expenses of the Bank; and (b) to pay, as the same become due, the Municipality's Allocable Proportion of the fees and expenses of the Trustee and paying agent for the Loan Obligations. The Municipality's Allocable Proportion as used herein shall mean the proportion- ate amount of the total requirement in respect to which the term is used determined by the ratio that the principal amount of the Municipal Bond outstanding bears to the total of all Loans then outstanding to all Governmental Units under the General Bond Resolution, as certified by the Bank. The waiver by the Bank of any fees payable pursuant to this Section 7 shall not constitute a subsequent waiver thereof. During any period where the Municipality's Allocable Proportion of the fees and expenses of the Trustee and paying agent for the Loan Obligations is reduced in consideration of the Municipality so making funds available, the Municipality shall make funds available to the Trustee for each Municipal Bond Interest Payment and Municipal Bond Principal Payment at least seven business days before the respective principal or interest payment date. 8. The Municipality is obligated to make the Municipal Bond Principal Payments scheduled by the Bank. The first such Municipal Bond Principal Payment is due on October 1, 1998, and thereafter on October 1 of each year. The Municipality is obligated to make the Municipal Bond Interest Payments scheduled by the Bank on a semi-annual basis commencing April 1, 1997, and to pay any Fees and Charges imposed by the Bank within 30 days of receiving the invoice of the Bank therefor. 9. The Bank shall not sell and the Municipality shall not redeem prior to maturity any portion of the Municipal Bond in an amount greater than the Loan Obligations which are then outstanding and which are then redeemable, and in the event of any such sale or redemption, the same shall be in an amount not less than the aggregate of (i) the principal amount of the Municipal Bond (or portion thereof) to be AMBB/City of Seward, General Obligation Hospital Bond, 1996 Loan Agreement AFF052E9I3742.1643 Page 3 of 9 redeemed, (ii) the interest to accrue on the Municipal Bond (or portion thereof) to be redeemed to the next redemption date thereof not previously paid, (iii) the applicable premium, if any, payable on the Municipal Bond (or portion thereof) to be redeemed, and (iv) the cost and expenses of the Bank in effecting the redemption of the Municipal Bond (or portion thereof) to be redeemed. The Municipality shall give the Bank at least 50 days' notice of intention to redeem its Municipal Bond. In the event the Loan Obligations with respect to which the sale or redemption prior to maturity of such Municipal Bond is being made have been refunded and the refunding bonds of the Bank issued for the purpose of refunding such Loan Obligations were issued in a principal amount in excess of or less than the principal amount of the Municipal Bond remaining unpaid at the date of issuance of such refunding bonds, the amount which the Municipality shall be obligated to payor the Bank shall receive under item (i) above shall be the principal amount of such refunding bonds outstanding. In the event the Loan Obligations have been refunded and the interest the Bank is required to pay on the refunding bonds is less than the interest the Bank was required to pay on the Loan Obligations, the amount which the Municipality shall be obligated to payor the Bank shall receive under item (ii) above shall be the amount of interest to accrue on such refunding bonds outstanding. In the event the Loan Obligations have been refunded, the amount which the Municipality shall be obligated to payor the Bank shall receive under item (iii) above, when the refunded Loan Obligations are to be redeemed, shall be the applicable premium, if any, on the Loan Obligations to be redeemed. Nothing in this Section shall be construed as preventing the Municipality from refunding the Municipal Bond in exchange for a new Municipal Bond in conjunction with a refunding of the Loan Obligations. 10. Simultaneously with the delivery of the Municipal Bond to the Bank, the Municipality shall furnish to the Bank evidence satisfactory to the Bank which shall set forth, among other things, that the Municipal Bond will constitute a valid general obligation of the Municipality. 11. Invoices for payments under this Loan Agreement shall be addressed to the City of Seward, P.O. Box 167, Seward, Alaska 99664, attention: City Manager. The Municipality shall give the Bank and the corporate trust office of the Trustee under the General Bond Resolution at least 30 days' written notice of any change in such address. 12. Prior to payment of the amount of the Loan or any portion thereof, and the delivery of the Municipal Bond to the Bank or its designee, the Bank shall have the right to cancel all or any part of its obligations hereunder if: AMBB/City of Seward, General Obligation Hospftal Bond, 1996 Loan Agreement AFF052E9I3742.1643 Page 4 of 9 , , , 19. In this Loan Agreement, unless otherwise defined herein, all capitalized terms which are defined in Article I of the General Bond Resolution shall have the same meanings, respectively, as such terms are given in Article I of the General Bond Resolution. 20. This Loan Agreement merges and supersedes all prior negotiations, representations and agreements between the parties hereto relating to the subject matter hereof and constitutes the entire agreement between the parties hereto in respect thereof. IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day and year first above written. ALASKA MUNICIPAL BOND BANK [SEAL] By NORMAN J. LEVESQUE Executive Director CITY OF SEWARD, ALASKA [SEAL] By City Manager A T T EST: City Clerk AMBBlCity of Seward, General Obligation Hospital Bond, 1996 Loan Agreement AFF052E9J3742.1643 Page 7 of 9 EXHIBIT "A" TO LOAN AGREEMENT BETWEEN THE CITY OF SEWARD, ALASKA, AND THE ALASKA MUNICIPAL BOND BANK City of Seward General Obligation Hospital Bond, 1996 Maturity ( 1) Principal Amount Interest Rate $ % AMBBlCity of Seward, General Obligation Hospnal Bond, 1996 Loan Agreement - Exhibit A AFF052E9I3142.1643 Page A-1