6a reso
SERIES RESOLUTION
PORT OF SEATTLE
______________________________________
RESOLUTION NO. 3653
A RESOLUTION of the Port Commission of the Port of Seattle
authorizing the issuance and sale of revenue refunding bonds in
multiple series, in the aggregate principal amount of not to exceed
$140,000,000 for the purpose of refunding certain outstanding
revenue bonds of the Port and paying costs of issuance; authorizing
preliminary and final official statements; authorizing the Chief
Executive Officer to approve the sale date or dates, final principal
amounts, interest rates, payment dates, redemption provisions,
maturity dates and principal maturities for the bonds; authorizing
the Designated Port Representative to appoint an escrow agent and
execute an escrow agreement; and providing for a negotiated sale
of the bonds to Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Backstrom McCarley Berry & Co., LLC, Barclays
Capital Inc., Drexel Hamilton, LLC, J.P. Morgan Securities LLC,
and Morgan Stanley & Co. LLC.
ADOPTED: _________, 2011
Prepared by:
K&L GATES LLP
Seattle, Washington
Port of Seattle
Resolution No. 3653,
Table of Contents*
Page
Section 1. Definitions............................................................................................................. 5
Section 2. Plan of Finance ................................................................................................... 13
Section 3. Authorization of Series 2011 Bonds ................................................................... 13
Section 4. Bond Terms ......................................................................................................... 13
Section 5. Redemption and Purchase ................................................................................... 16
Section 6. Registration, Exchange and Payments ................................................................ 20
Section 7. Series 2011 Bond Funds and Series 2011 Reserve Requirements ...................... 26
Section 8. Defeasance .......................................................................................................... 41
Section 9 Refunding Procedures ......................................................................................... 42
Section 10. Redemption of Refunded Bonds ......................................................................... 44
Section 11. Tax Covenants .................................................................................................... 45
Section 12. Lost, Stolen, Mutilated or Destroyed Series 2011 Bonds ................................... 45
Section 13. Form of Series 2011 Bonds and Registration Certificate ................................... 46
Section 14. Execution ............................................................................................................ 49
Section 15. Additional Covenant; Defaults and Remedies .................................................... 50
Section 16. Designation of Refunded Bonds; Sale of Series 2011 Bonds ............................. 51
Section 17. Compliance with Parity Conditions .................................................................... 54
Section 18. Undertaking to Provide Ongoing Disclosure ...................................................... 55
Section 19. Bond Insurance ................................................................................................... 55
Section 20. Severability ......................................................................................................... 55
Section 21. Effective Date ..................................................................................................... 56
Exhibit A-1 Series A Refunding Candidates
Exhibit A-2 Series B Refunding Candidates
Exhibit B Form of Escrow Deposit Agreement
* This Table of Contents and the Cover Page are for convenience of reference and are not
intended to be a part of this series resolution.
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RESOLUTION NO. 3653
A RESOLUTION of the Port Commission of the Port of Seattle
authorizing the issuance and sale of revenue refunding bonds in
multiple series, in the aggregate principal amount of not to exceed
$140,000,000 for the purpose of refunding certain outstanding
revenue bonds of the Port and paying costs of issuance; authorizing
preliminary and final official statements; authorizing the Chief
Executive Officer to approve the sale date or dates, final principal
amounts, interest rates, payment dates, redemption provisions,
maturity dates and principal maturities for the bonds; authorizing
the Designated Port Representative to appoint an escrow agent and
execute an escrow agreement; and providing for a negotiated sale
of the bonds to Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Backstrom McCarley Berry & Co., LLC, Barclays
Capital Inc., Drexel Hamilton, LLC, J.P. Morgan Securities LLC
and Morgan Stanley & Co. LLC .
WHEREAS, the Port of Seattle (the "Port"), a municipalcorporation of the State of
Washington, owns and operates a system of marine terminals and properties and Seattle-Tacoma
International Airport; and
WHEREAS, the Port has issued and currently has outstanding thirteen series of first lien
revenue bonds pursuant to the Master Resolution as defined herein, as follows:
Principal
Authorizing Date of Original Amount
Resolution Original Principal Outstanding Final
Number Issue Series Amount (10/02/2011) Maturity Dates
3430 08/10/2000 (B) $221,590,000 $ 38,655,000 02/01/2015
3462/3467 10/17/2001 (A) 176,105,000 176,105,000 04/01/2031
3462/3467 10/17/2001 (B) 251,380,000 198,000,000 04/01/2024
3462/3467 10/17/2001 (C) 12,205,000 12,205,000 12/01/2014
3462/3467 08/07/2002 (D) 68,580,000 40,870,000 11/01/2017
3509 08/20/2003 (A) 190,470,000 173,085,000 07/01/2033
3509 08/20/2003 (B) 164,900,000 146,900,000 07/01/2029
3528 06/30/2004 24,710,000 12,740,000 06/01/2017
3576 03/20/2007 (A) 27,880,000 27,880,000 10/01/2019
3576 03/20/2007 (B) 200,115,000 182,160,000 10/01/2032
3619 07/16/2009 (A) 20,705,000 20,705,000 05/01/2028
3619 07/16/2009 (B-1) 274,255,000 274,255,000 05/01/2036
3619 07/16/2009 (B-2) 22,000,325.95* 25,842,926* 05/01/2031
______________
* Series 2009 B-2 Bonds are capital appreciation bonds; total debt outstanding includes accreted interest through
October 2, 2011.
(the "Outstanding Parity Bonds"); and
WHEREAS, each of the resolutions authorizing the issuance of the Outstanding Parity
Bonds permits the Port to issue its revenue bonds having a lien on Net Revenues (as such term is
defined in the Master Resolution) subordinate to the lien thereon of the Outstanding Parity
Bonds; and
WHEREAS, the Port has authorized the issuance of revenue bonds subordinate to the lien
thereon of the Outstanding Parity Bonds in one or more series pursuant to Resolution No. 3540,
as amended, adopted on June 14, 2005 (the "Intermediate Lien Master Resolution"); and
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WHEREAS, the Port has issued and currently has outstanding six series of intermediate
lien revenue bonds pursuant to the Intermediate Lien Master Resolution, as follows:
Principal
Authorizing Date of Original Amount
Resolution Original Principal Outstanding Final
Number Issue Series Amount (10/02/11) Maturity Dates
3541 07/20/2005 (A) $ 404,595,000 $ 369,440,000 03/01/2035
3541 06/06/2006 (C) 40,120,000 27,425,000 09/01/2017
3563 06/28/2006 124,625,000 124,625,000 02/01/2030
3637 08/04/2010 (A) 25,200,000 23,030,000 06/01/2017
3637 08/04/2010 (B) 221,315,000 221,315,000 06/01/2040
3637 08/04/2010 (C) 128,140,000 127,820,000 02/01/2024
(the "Outstanding Intermediate Lien Bonds")
WHEREAS, the Master Resolution and the Intermediate Lien Master Resolution permit
the Port to issue its revenue bonds having a lien on Net Revenues (as such term is defined in the
Intermediate Lien Master Resolution) subordinate to the lien thereon of the Intermediate Lien
Bonds; and
WHEREAS, the Port has issued and currently has outstanding six series of subordinate
lien revenue bonds, as follows:
Principal
Authorizing Date of Original Amount Final
Resolution Original Principal Outstanding Maturity
Number Issue Series Amount (10/02/2011) Dates
3238 03/26/1997 $ 108,830,000 $ 108,830,000 09/01/2022
3276 05/01/1998 27,930,000 11,125,000 08/01/2017
3354 09/01/1999 (A) 127,140,000 121,840,000 09/01/2024
3354 09/01/1999 (B) 116,815,000 49,215,000 09/01/2016
3456 (CP) 250,000,000 22,655,000 06/01/2021
3598 06/17/2008 200,715,000 200,715,000 07/01/2033
(the "Outstanding Subordinate Lien Bonds"); and
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WHEREAS, the Port has outstanding certain revenue bonds described on Exhibit A
attached hereto (together, the "Refunding Candidates") that may be defeased and refunded by a
portion of the proceeds of the Series 2011 Bonds authorized (and further defined) herein; and
WHEREAS, each of the resolutions authorizing the issuance of the Outstanding Parity
Bonds permits the Port to issue its revenue bonds having a lien on Net Revenues (as such term is
defined in the Master Resolution) on a parity with the lien thereon of the Outstanding Parity
Bonds upon compliance with certain conditions; and
WHEREAS, the Port has determined that such conditions will be met; and
WHEREAS, pursuant to RCW 53.40.030, the Port Commission may delegate authority to
the Chief Executive Officer of the Port to approve the designation of the bonds to be refunded,
the interest rates, maturity dates, redemption rights, interest payment dates, and principal
amounts under such terms and conditions as are approved by resolution; and
WHEREAS, it is necessary that the date, tax status, form, maximum aggregate principal
amount for all bonds to be issued pursuant to this series resolution (hereinafter together defined
as the "Series 2011 Bonds"), the Savings Target to be specified, that the determination of
maturities, interest rates, redemption rights and principal amount of each series, and that the lien
thereof on the Net Revenues of the Port be established as herein provided; and
WHEREAS, the Port has held a public hearing on the issuance of a series of the
Series 2011 Bonds (hereinafter defined) as required by Section 147(f) of the Internal Revenue
Code, as amended; and
WHEREAS, it is deemed necessary and desirable that the Series 2011 Bonds be sold
pursuant to negotiated sale as herein provided;
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NOW, THEREFORE, BE IT RESOLVED BY THE PORT COMMISSION OF THE
PORT OF SEATTLE, as follows:
Section 1. Definitions. Unless otherwise defined herein, the terms used in this series
resolution, including the preamble hereto, that are defined in the Master Resolution shall have
the meanings set forth in the Master Resolution. In addition, the following terms shall have the
following meanings in this series resolution:
Acquired Obligations means the Government Obligations acquired by the Port under the
terms of this series resolution and the Escrow Agreement, if any, to effect the defeasance and
refunding of the Refunded Bonds.
Beneficial Owner means any person that has or shares the power, directly or indirectly,
to make investment decisions concerning ownership of any Series 2011 Bonds (including
persons holding Series 2011 Bonds through nominees, depositories or other intermediaries).
Bond Counsel means a firm of lawyers nationally recognized and accepted as bond
counsel and so employed by the Port for any purpose under this series resolution applicable to
the use of that term.
Bond Insurance Commitment means the commitment(s) of the Bond Insurer, if any, to
insure one or more series, or certain principal maturities thereof, of the Series 2011 Bonds.
Bond Insurance Policy means the policy(ies) of municipal bond insurance, if any,
delivered by the Bond Insurer at the time of issuance and delivery of Series 2011 Bonds to be
insured pursuant to the Bond Insurance Commitment.
Bond Insurer means the municipal bond insurer(s), if any, that has committed to insure
one or more series, or certain principal maturities thereof, of Series 2011 Bonds pursuant to the
Bond Insurance Commitment.
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Bond Purchase Contract means the Bond Purchase Contract for the Series 2011 Bonds,
providing for the purchase of the Series 2011 Bonds by the Underwriters and setting forth certain
terms authorized to be approved by the Designated Port Representative as provided in Section 16
of this series resolution.
Bond Register means the registration records for the Series 2011 Bonds maintained by
the Registrar.
Chief Executive Officer means the Chief Executive Officer of the Port, or any successor
to the functions of his office.
Code means the Internal Revenue Code of 1986, as amended, together with
corresponding and applicable final, temporary or proposed regulations or revenue rulings issued
or amended with respect thereto by the U.S. Treasury Department or the Internal Revenue
Service, to the extent applicable to the Series 2011 Bonds.
Continuing Disclosure Certificate means the undertaking for ongoing disclosure
executed by the Port pursuant to Section 18 of this series resolution.
Default has the meaning given such term in Section 15(b) of this series resolution.
Designated Port Representative, for purposes of this series resolution, means the Chief
Executive Officer of the Port, the Deputy Chief Executive Officer of the Port or the Chief
Financial and Administrative Officer of the Port (or the successor in function to such person(s))
or such other person as may be directed by resolution of the Commission.
DTC means The Depository Trust Company, New York, New York, a limited purpose
trust company organized under the laws of the State of New York, as depository for the
Series 2011 Bonds pursuant to Section 6 hereof.
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Escrow Agent means the Escrow Agent for the Refunded Bonds appointed by the
Designated Port Representative pursuant to this resolution if the Designated Port Representative
determines that an escrow will be necessary or required to carry out the plan of refunding.
Escrow Agreement means the Escrow Deposit Agreement, if any, dated as of the date of
the closing and delivery of the Refunding Bonds between the Port and the Escrow Agent to be
executed in connection with the refunding of the Refunded Bonds, substantially in the form
attached hereto as Exhibit B.
Federal Tax Certificate means the certificate(s) of that name executed and delivered by
the Designated Port Representative at the time of issuance and delivery of the Series 2011 Bonds
that are issued on a tax-exempt basis.
Future Parity Bonds means those revenue bonds or other revenue obligations that are
issued by the Port in the future as Parity Bonds.
Government Obligations has the meaning given to such term in RCW Chapter 39.53, as
amended.
Letter of Representations means the blanket issuer letter of representations from the Port
to DTC, dated August 28, 1995.
Master Resolution means Resolution No. 3059, as amended, of the Commission adopted
on February 2, 1990, as amended by Resolution No. 3214, adopted on March 26, 1996,
Resolution No. 3241, adopted on April 8, 1997, and Resolution No. 3436, adopted on
July 11, 2000 and as amended and restated by Resolution No. 3577 of the Commission adopted
on February 27, 2007.
MSRB means the Municipal Securities Rulemaking Board or any successors to its
functions. Until otherwise designated by the MSRB or the Commission, any information, reports
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or notices submitted to the MSRB in compliance with the Rule are to be submitted through the
MSRB's Electronic Municipal Market Access system ("EMMA"), currently located at
www.emma.msrb.org.
Outstanding Parity Bonds means, collectively, the Port's outstanding Revenue Bonds,
Series 2000B issued pursuant to Resolution No. 3430, as amended; Revenue Bonds,
Series 2001A and Series 2001B and Revenue Refunding Bonds, Series 2001C and Series 2001D
issued pursuant to Resolution No. 3462, as amended and Resolution No. 3467, as amended;
Revenue Bonds, Series 2003A and Series 2003B issued pursuant to Resolution No. 3509, as
amended; Revenue Bonds, Series 2004 issued pursuant to Resolution No. 3528, as amended,
Revenue Bonds, Series 2007A and Series 2007B issued pursuant to Resolution No. 3576, as
amended; and Revenue Bonds, Series 2009A, Series 2009B-1 and Series 2009B-2 issued
pursuant to Resolution No. 3619, as amended.
Parity Bonds means and includes the Outstanding Parity Bonds, the Series 2011 Bonds
and any Future Parity Bonds and has the meaning ascribed to "Bonds" in the Master Resolution.
Rating Category means the generic rating categories of a Rating Agency, without regard
to any refinement or gradation of such rating category by a numerical modifier or otherwise.
Refunded Bonds means the Series A Refunding Candidates and Series B Refunding
Candidates as described on Exhibit A that are designated by the Chief Executive Officer
pursuant to Section 16 of this series resolution.
Registered Owner means the person named as the registered owner of a Series 2011
Bond in the Bond Register.
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Registrar means the fiscal agency of the State of Washington, appointed by the
Designated Port Representative for the purposes of registering and authenticating the Series 2011
Bonds, maintaining the Bond Register and effecting transfer of ownership of the Series 2011
Bonds. The term Registrar shall include any successor to the fiscal agency, if any, hereinafter
appointed by the Designated Port Representative.
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.
Savings Target means a dollar amount at least equal to three and 75/100 percent (3.75%)
of the principal amount of the Refunded Bonds.
Series A Refunding Candidates means the outstanding revenue bonds of the Port as
described on Exhibit A-1.
Series B Refunding Candidates means the outstanding revenue bonds of the Port as
described on Exhibit A-2.
Series 2011 Bonds means, collectively, the Series 2011A Bonds, the Series 2011B Bonds
and the Series 2011C Bonds.
Series 2011A Bond Fund means the Port of Seattle Revenue Bond Fund, Series 2011A
created in the office of the Treasurer by Section 7(a)(1) of this series resolution.
Series 2011A Bonds means the Port of Seattle Revenue Refunding Bonds, Series 2011A,
authorized to be issued by Section 3(a) of this series resolution.
Series 2011A Debt Service Reserve Fund means the fund of that name that may be
created pursuant to the authority of Section 7(b)(1) of this series resolution.
Series 2011A Debt Service Reserve Requirement, if any, means the dollar amount or
formula set forth in the Bond Purchase Contract. The Series 2011A Debt Service Reserve
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Requirement may be a contribution to the Common Reserve Fund. If separately provided for as
a formula, the Series 2011A Debt Service Reserve Requirement shall be adjusted accordingly
and remain in effect until a payment of principal of Series 2011A Bonds when the Series 2011A
Debt Service Reserve Requirement shall be re-calculated.
Series 2011B Bond Fund means the Port of Seattle Revenue Bond Fund, Series 2011B
created in the office of the Treasurer by Section 7(a)(2) of this series resolution.
Series 2011B Bonds means the Port of Seattle Revenue Refunding Bonds, Series 2011B,
authorized to be issued by Section 3(b) of this series resolution.
Series 2011B Debt Service Reserve Fund means the fund of that name that may be
created pursuant to the authority of Section 7(b)(2) of this series resolution.
Series 2011B Debt Service Reserve Requirement, if any, means the dollar amount or
formula set forth in the Bond Purchase Contract. The Series 2011B Debt Service Reserve
Requirement may be a contribution to the Common Reserve Fund. If separately provided for as
a formula, the Series 2011B Debt Service Reserve Requirement shall be adjusted accordingly
and remain in effect until a payment of principal of Series 2011B Bonds when the Series 2011B
Debt Service Reserve Requirement shall be re-calculated.
Series 2011C Bond Fund means the Port of Seattle Revenue Bond Fund, Series 2011C
created in the office of the Treasurer by Section 7(a)(2) of this series resolution.
Series 2011C Bonds means the Port of Seattle Revenue Refunding Bonds, Series 2011C,
authorized to be issued by Section 3(b) of this series resolution.
Series 2011C Debt Service Reserve Fund means the fund of that name that may be
created pursuant to the authority of Section 7(b)(2) of this series resolution.
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Series 2011C Debt Service Reserve Requirement, if any, means the dollar amount or
formula set forth in the Bond Purchase Contract. The Series 2011C Debt Service Reserve
Requirement may be a contribution to the Common Reserve Fund. If separately provided for as
a formula, the Series 2011C Debt Service Reserve Requirement shall be adjusted accordingly
and remain in effect until a payment of principal of Series 2011C Bonds when the Series 2011C
Debt Service Reserve Requirement shall be re-calculated.
Subordinate Lien Bond Resolutions means, collectively, Resolution No. 3238, as
amended, Resolution No. 3276, as amended; Resolution No. 3354, as amended; Resolution
No. 3456, as amended; Resolution No. 3544, as amended and Resolution No. 3598, as amended.
Surety Bond means one or more of the surety bond(s), if any, issued by the Surety Bond
Issuer on the date of issuance of the Series 2011 Bonds of any series for the purpose of satisfying
all or a portion of the Common Reserve Fund Requirement and/or the Series 2011A Debt
Service Reserve Requirement and/or the Series 2011B Debt Service Reserve Requirement and/or
the Series 2011C Debt Service Reserve Requirement; provided that in each case the Surety Bond
meets the requirements for "Qualified Insurance" at the time of issuance of the Surety Bond.
There may be more than one Surety Bond.
Surety Bond Agreement means any Agreement between the Port and the Surety Bond
Issuer with respect to the Surety Bond.
Surety Bond Issuer or Surety Bond Issuers means the surety bond issuer(s), if any,
issuing a surety bond for the purpose of satisfying all or a portion of the Series 2011A Debt
Service Reserve Requirement and/or the Series 2011B Debt Service Reserve Requirement and/or
the Series 2011C Debt Service Reserve Requirement. There may be more than one Surety Bond
Issuer.
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Underwriters mean, collectively, Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Barclays Capital Inc., J.P. Morgan Securities LLC, Morgan Stanley & Co. LLC, Backstrom
McCarley Berry & Co., LLC and Drexel Hamilton, LLC.
Interpretation. In this series resolution, unless the context otherwise requires:
(a) The terms "hereby," "hereof," "hereto," "herein, "hereunder" and any similar
terms, as used in this series resolution, refer to this series resolution as a whole and not to any
particular article, section, subdivision or clause hereof, and the term "hereafter" shall mean after,
and the term "heretofore" shall mean before the date of this series resolution;
(b) Words of the masculine gender shall mean and include correlative words of the
feminine and neuter genders and words importing the singular number shall mean and include
the plural number and vice versa;
(c) Words importing persons shall include firms, associations, partnerships (including
limited partnerships), trusts, corporations, limited liability companies and other legal entities,
including public bodies, as well as natural persons;
(d) Any headings preceding the text of the several articles and sections of this series
resolution, and any table of contents or marginal notes appended to copies hereof, shall be solely
for convenience of reference and shall not constitute a part of this series resolution, nor shall they
affect its meaning, construction or effect;
(e) All references herein to "articles," "sections" and other subdivisions or clauses are
to the corresponding articles, sections, subdivisions or clauses hereof; and
(f) Whenever any consent or direction is required to be given by the Port, such
consent or direction shall be deemed given when given by the Designated Port Representative.
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Section 2. Plan of Finance. The Refunding Candidates are callable in whole or in
part prior to their scheduled maturities and may be selected for refunding depending upon market
conditions. The final selection of the maturities, if any, within each series of the Refunding
Candidates designated as Refunded Bonds to be refunded by the Series 2011 Bonds shall be
made by the Chief Executive Officer pursuant to the authority granted in Section 16 of this series
resolution.
Section 3. Authorization of Series 2011 Bonds. The Port shall issue the Series
2011A Bonds as a series for the purpose of refunding the Series A Refunding Candidates and the
Series 2011B Bonds and the Series 2011C Bonds, if any, as a second and optional third series for
the purpose of refunding the Series B Refunding Candidates. The proceeds of the Series 2011
Bonds shall be used for the purposes of providing the funds necessary to refund the Refunded
Bonds, to make a deposit to the Common Reserve Fund, or to make deposits to Series 2011A
Debt Service Reserve Fund and/or the Series 2011B Debt Service Reserve Fund and/or the
Series 2011C Debt Service Reserve Fund, or to purchase one or more Surety Bonds and to pay
all or a portion of the costs incidental to the foregoing and to the issuance of the Series 2011
Bonds.
The aggregate principal amount of the Series 2011 Bonds to be issued under this series
resolution shall not exceed $140,000,000 and shall be determined by the Chief Executive
Officer, pursuant to the authority granted in Section 16 of this series resolution.
Section 4. Bond Terms.
(a) Series 2011A. The Series 2011A Bonds shall be designated as "Port of Seattle
Revenue Refunding Bonds, Series 2011A," shall be registered as to both principal and interest,
shall be issued in the aggregate principal amount set forth in the Bond Purchase Contract, and
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shall be numbered separately in the manner and with any additional designation as the Registrar
deems necessary for purposes of identification, shall be dated their date of delivery to the
Underwriters, shall be in the denomination of $5,000 each or any integral multiple of $5,000
within a maturity, bearing interest as and at the rates set forth in the Bond Purchase Contract and
as approved by the Chief Executive Officer pursuant to Section 16. The Series 2011A Bonds
shall bear interest from their date of delivery to the Underwriters until the Series 2011A Bonds
bearing such interest have been paid or their payment duly provided for, payable semiannually
on the dates set forth in the Bond Purchase Contact and shall mature on the dates and in the
principal amounts set forth in the Bond Purchase Contract and as approved by the Chief
Executive Officer pursuant to Section 16.
The Series 2011A Bonds shall be obligations only of the Series 2011A Bond Fund and
the Common Reserve Fund or the Series 2011A Debt Service Reserve Fund, as applicable, and
shall be payable and secured as provided herein. The Series 2011A Bonds do not constitute an
indebtedness of the Port within the meaning of the constitutional provisions and limitations of
the State of Washington.
(b) Series 2011B. The Series 2011B Bonds shall be designated as "Port of Seattle
Revenue Refunding Bonds, Series 2011B," shall be registered as to both principal and interest,
shall be issued in the aggregate principal amount set forth in the Bond Purchase Contract, and
shall be numbered separately in the manner and with any additional designation as the Registrar
deems necessary for purposes of identification, shall be dated their date of delivery to the
Underwriters, shall be in the denomination of $5,000 each or any integral multiple of $5,000
within a maturity, bearing interest as and at the rates set forth in the Bond Purchase Contract and
as approved by the Chief Executive Officer pursuant to Section 16. The Series 2011B Bonds
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shall bear interest from their date of delivery to the Underwriters until the Series 2011B Bonds
bearing such interest have been paid or their payment duly provided for, payable on the dates set
forth in the Bond Purchase Contract and shall mature on the dates and in the years and in the
principal amounts set forth in the Bond Purchase Contract and as approved by Chief Executive
Officer pursuant to Section 16.
The Series 2011B Bonds shall be obligations only of the Series 2011B Bond Fund and
the Common Reserve Fund or the Series 2011B Debt Service Reserve Fund, as applicable, and
shall be payable and secured as provided herein. The Series 2011B Bonds do not constitute an
indebtedness of the Port within the meaning of the constitutional provisions and limitations of
the State of Washington.
(c) Series 2011C. If the Port determines to issue taxable bonds in order to refund a
portion of the Series B Refunding Candidates, the third series shall be designated as "Port of
Seattle Revenue Refunding Bonds, Series 2011C," shall be registered as to both principal and
interest, shall be issued in the aggregate principal amount set forth in the Bond Purchase
Contract, and shall be numbered separately in the manner and with any additional designation as
the Registrar deems necessary for purposes of identification, shall be dated their date of delivery
to the Underwriters, shall be in the denomination of $5,000 each or any integral multiple of
$5,000 within a maturity, bearing interest as and at the rates set forth in the Bond Purchase
Contract and as approved by the Chief Executive Officer pursuant to Section 16. The
Series 2011C Bonds shall bear interest from their date of delivery to the Underwriters until the
Series 2011C Bonds bearing such interest have been paid or their payment duly provided for,
payable on the dates set forth in the Bond Purchase Contract and shall mature on the dates and in
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the years and in the principal amounts set forth in the Bond Purchase Contract and as approved
by Chief Executive Officer pursuant to Section 16.
The Series 2011C Bonds shall be obligations only of the Series 2011C Bond Fund and
the Common Reserve Fund or the Series 2011C Debt Service Reserve Fund, as applicable, and
shall be payable and secured as provided herein. The Series 2011C Bonds do not constitute an
indebtedness of the Port within the meaning of the constitutional provisions and limitations of
the State of Washington.
Section 5. Redemption and Purchase.
(a) Optional Redemption. One or more series of Series 2011 Bonds may be subject
to optional redemption on the dates, at the prices and under the terms set forth in the Bond
Purchase Contract all as approved by the Chief Executive Officer pursuant to Section 16.
(b) Mandatory Redemption. One or more series of Series 2011 Bonds may be subject
to mandatory redemption to the extent, if any, set forth in the Bond Purchase Contract all as
approved by the Chief Executive Officer pursuant to Section 16.
(c) Purchase of Series 2011 Bonds for Retirement. The Port reserv es the right to use
at any time any surplus Gross Revenue available after providing for the payments required by
paragraph First through Fifth of Section 2(a) of the Master Resolution, including the payments
required by paragraph First through Seventh of the priority for use of Gross Revenue set forth in
the Subordinate Lien Bond Resolutions, to purchase for retirement any of the Series 2011 Bonds
offered to the Port at any price deemed reasonable to the Designated Port Representative.
(d) Selection of Series 2011A Bonds and Series 2011B Bonds for Redemption. If
Series 2011A Bonds and/or Series 2011B Bonds are called for optional redemption, the series
and maturities of Series 2011 Bonds to be redeemed shall be selected by the Port. If any
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Series 2011A Bonds and/or Series 2011B Bonds to be redeemed (optional or mandatory) then
are held in book-entry-only form, the selection of Series 2011A Bonds and/or Series 2011B
Bonds to be redeemed within a maturity shall be made in accordance with the operational
arrangements then in effect at DTC (or at a substitute depository, if applicable). If the
Series 2011A Bonds and/or Series 2011B Bonds to be redeemed are no longer held in
book-entry-only form, the selection of such Series 2011A Bonds and/or Series 2011B Bonds to
be redeemed shall be made in the following manner. If the Port redeems at any one time fewer
than all of the Series 2011A Bonds and/or Series 2011B Bonds having the same maturity date,
the particular Series 2011A Bonds and/or Series 2011B Bonds or portions of Series 2011A
Bonds and/or Series 2011B Bonds and maturity to be redeemed shall be selected by lot (or in
such other random manner determined by the Registrar) in increments of $5,000. In the case of a
Series 2011A Bonds and/or Series 2011B Bonds and maturity of a denomination greater than
$5,000, the Port and Registrar shall treat each Series 2011A Bonds and/or Series 2011B Bonds
of the applicable series and maturity as representing such number of separate Series 2011A
Bonds and/or Series 2011B Bonds each of the denomination of $5,000 as is obtained by dividing
the actual principal amount of such Series 2011A Bonds and/or Series 2011B Bonds of the
applicable series and maturity by $5,000. In the event that only a portion of the principal amount
of a Series 2011A Bond and/or Series 2011B Bond is redeemed, upon surrender of such
Series 2011A Bond and/or Series 2011B Bond at the principal office of the Registrar there shall
be issued to the Registered Owner, without charge therefor, for the then-unredeemed balance of
the principal amount thereof a Series 2011A Bond and/or Series 2011B Bond or, at the option of
the Registered Owner, a Series 2011 Bond of like series, maturity and interest rate in any of the
denominations herein authorized.
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(e) Selection of Series 2011C Bonds for Redemption. The manner of selection of
Series 2011C Bonds shall be as set forth in the Bond Purchase Contract and as approved by
Chief Executive Officer pursuant to Section 16.
(f) Notice of Redemption. Written notice of any redemption of Series 2011 Bonds
prior to maturity shall be given by the Registrar on behalf of the Port by first class mail, postage
prepaid, not less than 20 days nor more than 60 days before the date fixed for redemption to the
Registered Owners of Series 2011 Bonds that are to be redeemed at their last addresses shown on
the Bond Register. This requirement shall be deemed complied with when notice is mailed to the
Registered Owners at their last addresses shown on the Bond Register, whether or not such
notice is actually received by the Registered Owners.
So long as the Series 2011 Bonds are in book-entry only form, notice of redemption shall
be given to Beneficial Owners of Series 2011 Bonds to be redeemed in accordance with the
operational arrangements then in effect at DTC, and neither the Port nor the Registrar shall be
obligated or responsible to confirm that any notice of redemption is, in fact, provided to
Beneficial Owners.
Each notice of redemption (which notice may be conditional) prepared and given by the
Registrar to Registered Owners of Series 2011 Bonds shall contain the following information:
(1) the date fixed for redemption, (2) the redemption price, (3) if fewer than all outstanding
Series 2011 Bonds of a series are to be redeemed, the identification by maturity and series (and,
in the case of partial redemption, the principal amounts) of the Series 2011 Bonds to be
redeemed, (4) whether the notice of redemption is conditional and, if conditional, the conditions
to redemption, (5) that (unless the notice of optional redemption is a conditional notice, in which
case the notice shall state that such Series 2011 Bonds will become due and payable and interest
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shall cease to accrue from the date fixed for redemption if and to the extent in each case funds
have been provided to the Registrar for the redemption of such Series 2011 Bonds) on the date
fixed for redemption the redemption price will become due and payable upon each Series 2011
Bond or portion called for redemption, and that interest shall cease to accrue from the date fixed
for redemption, (6) that the Series 2011 Bonds are to be surrendered for payment at the principal
office of the Registrar, (7) the CUSIP numbers of all Series 2011 Bonds being redeemed, (8) the
dated date of the Series 2011 Bonds being redeemed, (9) the rate of interest for each Series 2011
Bond being redeemed, (10) the date of the notice, and (11) any other information deemed
necessary by the Registrar to identify the Series 2011 Bonds being redeemed.
Upon the payment of the redemption price of Series 2011 Bonds being redeemed, each
check or other transfer of funds issued for such purpose shall bear the CUSIP number
identifying, by issue and maturity, the Series 2011 Bonds being redeemed with the proceeds of
such check or other transfer.
(g) Effect of Redemption. Unless the Port has revoked a notice of optional
redemption (or unless the Port provided a conditional notice of optional redemption and the
conditions for redemption set forth therein are not satisfied), the Port shall transfer to the
Registrar amounts that, in addition to other money, if any, held by the Registrar for such purpose,
will be sufficient to redeem, on the date fixed for redemption, all the Series 2011 Bonds to be
redeemed. If and to the extent that funds have been provided to the Registrar for the redemption
of Series 2011 Bonds then from and after the date fixed for redemption for such Series 2011
Bond or portion thereof, interest on each such Series 2011 Bond shall cease to accrue and such
Series 2011 Bond or portion thereof shall cease to be Outstanding.
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(h) Amendment of Notice Provisions. The foregoing notice provisions of this section,
including but not limited to the information to be included in redemption notices and the persons
designated to receive notices, may be amended by additions, deletions and changes to maintain
compliance with duly promulgated regulations and recommendations regarding notices of
redemption of municipal securities.
Section 6. Registration, Exchange and Payments.
(a) Registrar/Bond Register. The Port hereby adopts the system of registration
approved by the Washington State Finance Committee, which utilizes the fiscal agencies of the
State of Washington, for the purposes of registering and authenticating the Series 2011 Bonds,
maintaining the Bond Register and effecting transfer of ownership of the Series 2011 Bonds
(collectively, the "Registrar"). The Registrar shall keep, or cause tobe kept, at its principal
corporate trust office, sufficient records for the registration and transfer of the Series 2011 Bonds
(the "Bond Register"), which shall be open to inspection by the Port. The Registrar may be
removed at any time at the option of the Designated Port Representative upon prior notice to the
Registrar, DTC (or its successor or alternate depository), each party entitled to receive notice
pursuant to the Continuing Disclosure Undertaking and a successor Registrar appointed by the
Designated Port Representative. No resignation or removal of the Registrar shall be effective
until a successor shall have been appointed and until the successor Registrar shall have accepted
the duties of the Registrar hereunder. The Registrar is authorized, on behalf of the Port, to
authenticate and deliver Series 2011 Bonds transferred or exchanged in accordance with the
provisions of such Series 2011 Bonds and this series resolution and to carry out all of the
Registrar's powers and duties under this series resolution. The Registrar shall be responsible for
its representations contained in the Certificate of Authentication on the Series 2011 Bonds.
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(b) Registered Ownership. Except as provided in Section 6(c) or the Continuing
Disclosure Certificate authorized pursuant to Section 18, the Port and the Registrar may deem
and treat the Registered Owner of each Series 2011 Bond as the absolute owner for all purposes,
and neither the Port nor the Registrar shall be affected by any notice to the contrary. Payment of
any such Series 2011 Bond shall be made only as described in subsection (h) hereof, but the
transfer of such Series 2011 Bond may be registered as herein provided. All such payments
made as described in subsection (h) shall be valid and shall satisfy the liability of the Port upon
such Series 2011 Bond to the extent of the amount or amounts so paid.
(c) DTC Acceptance/Letter of Representations. The Series 2011 Bonds shall initially
be held in fully immobilized form by DTC acting as depository. To induce DTC to accept the
Series 2011 Bonds as eligible for deposit at DTC, the Port has heretofore executed and delivered
to DTC the Letter of Representations.
Neither the Port nor the Registrar will have any responsibility or obligation to DTC
participants or the persons for whom they act as nominees with respect to the Series 2011 Bonds
for the accuracy of any records maintained by DTC (or any successor or alternate depository) or
any DTC participant, the payment by DTC (or any successor or alternate depository) or any DTC
participant of any amount in respect of the principal of or interest on Series 2011 Bonds, any
notice that is permitted or required to be given to Registered Owners under this series resolution
(except such notices as shall be required to be given by the Port to the Registrar or, by the
Registrar, to DTC (or any successor or alternate depository)), the selection by DTC or by any
DTC participant of any person to receive payment in the event of a partial redemption of the
Series 2011 Bonds, or any consent given or other action taken by DTC (or any successor or
alternate depository) as the Registered Owner. So long as any Series 2011 Bonds are held in
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fully immobilized form hereunder, DTC or its successor depository shall be deemed to be the
owner and Registered Owner for all purposes, and all references in this series resolution to the
Registered Owners shall mean DTC (or any successor or alternate depository) or its nominee and
shall not mean the owners of any beneficial interest in any Series 2011 Bonds. Notwithstanding
the foregoing, if a Bond Insurance Policy is issued for any series or maturity of the Series 2011
Bonds and so long as the Bond Insurer is not in default under its Policy, the Bond Insurer shall
be deemed to be the owner, Registered Owner, and holder of all bonds of that series or maturity
for the purpose of granting consents and exercising voting rights with respect thereto and for any
other purpose identified and specified in the Bond Insurance Commitment accepted by the Port
as a condition of issuance of the Bond Insurance Policy.
(d) Use of Depository.
(1) The Series 2011 Bonds shall be registered initially in the name of
CEDE & Co., as nominee of DTC, with a single Series 2011 Bond for each series and maturity
in a denomination equal to the total principal amount of such series and maturity. Registered
ownership of such immobilized Series 2011 Bonds, or any portions thereof, may not thereafter
be transferred except (A) to any successor of DTC or its nominee, or to any other nominee
requested by an authorized representative of DTC, provided that any such successor shall be
qualified under any applicable laws to provide the service proposed to be provided by it; (B) to
any substitute depository appointed by the Port pursuant to subsection (2) below or such
substitute depository's successor or nominee; or (C) to any personas provided in subsection (4)
below.
(2) 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 Port to discontinue the
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system of book entry transfers through DTC or its successor (or any substitute depository or its
successor), the Port 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.
(3) In the case of any transfer pursuant to clause (A) or (B) of subsection (1)
above, the Registrar shall, upon receipt of all outstanding Series 2011 Bonds, together with a
written request on behalf of the Port, issue a single new Series 2011 Bond for each series and
maturity then outstanding, registered in the name of such successor or substitute depository, or
its nominee, all as specified in such written request of the Port.
(4) In the event that (A) DTC or its successor (or substitute depository or its
successor) resigns from its functions as depository, and no substitute depository can be obtained,
or (B) the Port determines that it is in the best interest of the Beneficial Owners of the
Series 2011 Bonds of any series that the Series 2011 Bonds of that series be provided in
certificated form, the ownership of such Series 2011 Bonds may then be transferred to any
person or entity as herein provided, and shall no longer be held in fully immobilized form. The
Port shall deliver a written request to the Registrar, together with a supply of definitive
Series 2011 Bonds (of the appropriate series and maturities) in certificated form, to issue
Series 2011 Bonds in any authorized denominations. Upon receipt by the Registrar of all then
outstanding Series 2011 Bonds (of the appropriate series), together with a written request on
behalf of the Port to the Registrar, new Series 2011 Bonds of such series shall be issued in the
appropriate denominations and registered in the names of such persons as are provided in such
written request.
(e) Registration of the Transfer of Ownership or the Exchange of Series 2011 Bonds;
Change in Denominations. The transfer o f any Series 2011 Bond may be registered and any
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Series 2011 Bond may be exchanged, but no transfer of any Series 2011 Bond shall be valid
unless the Series 2011 Bond is surrendered to the Registrar with the assignment form appearing
on such Series 2011 Bond duly executed by the Registered Owner or such Registered Owner's
duly authorized agent in a manner satisfactory to the Registrar. Upon such surrender, the
Registrar shall cancel the surrendered Series 2011 Bond and shall authenticate and deliver,
without charge to the Registered Owner or transferee, a new Series 2011 Bond (or Series 2011
Bonds at the option of the Registered Owner) of the same date, series, maturity and interest rate
and for the same aggregate principal amount in any authorized denomination, as and naming as
Registered Owner the person or persons listed as the assignee on the assignment form appearing
on the surrendered Series 2011 Bond, in exchange for such surrendered and canceled Series 2011
Bond. Any Series 2011 Bond may be surrendered to the Registrar, together with the assignment
form appearing on such Series 2011 Bond duly executed, and exchanged, without charge, for an
equal aggregate principal amount of Series 2011 Bonds of the same date, series, maturity and
interest rate, in any authorized denomination. The Registrar shall not be obligated to register the
transfer or exchange of any Series 2011 Bond during a period beginning at the opening of
business on the 15th day of the month next preceding any interest payment date and ending at the
close of business on such interest payment date, or, in the case of any proposed redemption of
the Series 2011 Bonds, after the mailing of notice of the call of such Series 2011 Bonds for
redemption.
(f) Registrar's Ownership of Series 2011Bonds. The Registrar may become the
Registered Owner of any Series 2011 Bond with the same rights it would have if it were not the
Registrar, and to the extent permitted by law, may act as depository for and permit any of its
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officers or directors to act as member of, or in any other capacity with respect to, any committee
formed to protect the rights of the Registered Owners of the Series 2011 Bonds.
(g) Registration Covenant. The Port covenants that, until all Series 2011 Bonds
issued on a tax-exempt basis have been surrendered and canceled, it will maintain a system for
recording the ownership of each Series 2011 Bond that complies with the provisions of
Section 149 of the Code.
(h) Place and Medium of Payment. The principal of, premium, if any, and interest on
the Series 2011 Bonds shall be payable in lawful money of the United States of America. For so
long as all Series 2011 Bonds are in fully immobilized form, payments of principal, premium, if
any, and interest shall be made as provided in accordance with the operational arrangements of
DTC described in the Letter of Representations. In the event that the Series 2011 Bonds are no
longer in fully immobilized form, interest on the Series 2011 Bonds shall be paid by check
mailed to the Registered Owners at the addresses for such Registered Owners appearing on the
Bond Register on the 15th day of the month preceding the interest payment date, and principal
and premium, if any, of the Series 2011 Bonds shall be payable by check upon presentation and
surrender of such Series 2011 Bonds by the Registered Owners at the principal office of the
Registrar; provided, however, that if so requested in writing prior to the opening of business on
the 15th day of the month preceding any interest payment date by the Registered Owner of at
least $1,000,000 aggregate principal amount of Series 2011 Bonds, interest will be paid
thereafter by wire transfer on the date due to an account with a bank located within the United
States.
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Section 7. Series 2011 Bond Funds and Series 2011 Reserve Requirements.
(a) Series 2011 Bond Funds.
(1) Series 2011A Bond Fund. A special fund of the Port designated the "Port
of Seattle Revenue Bond Fund, Series 2011A" (the "Series 2011A Bond Fund") is hereby
authorized to be created in the office of the Treasurer for the purpose of paying and securing the
payment of the Series 2011A Bonds. The Series 2011A Bond Fund shall be held separate and
apart from all other funds and accounts of the Port and shall be a trust fund for the owners of the
Series 2011A Bonds.
The Series 2011A Bonds shall be obligations only of the Series 2011A Bond Fund and
the Series 2011A Debt Service Reserve Fund or the Common Reserve Fund, as applicable, and
shall be payable and secured as provided herein. The Series 2011A Bonds do not constitute an
indebtedness of the Port within the meaning of the constitutional and statutory provisions and
limitations of the laws of the State of Washington.
The Port hereby irrevocably obligates and binds itself for so long as any Series 2011A
Bonds remain Outstanding to set aside and pay into the Series 2011A Bond Fund from Net
Revenues or money in the Revenue Fund, on or prior to the respective dates on which the same
become due:
(A) such amounts as are required to pay the interest scheduled to
become due and redemption premium, if any, on Outstanding Series 2011A Bonds; and
(B) such amounts as are required to pay maturing principal or principal
being redeemed of Outstanding Series 2011A Bonds.
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(2) Series 2011B Bond Fund. A special fund of the Port designated the "Port
of Seattle Revenue Bond Fund, Series 2011B" (the "Series 2011B Bond Fund") is hereby
authorized to be created in the office of the Treasurer for the purpose of paying and securing the
payment of the Series 2011B Bonds. The Series 2011B Bond Fund shall be held separate and
apart from all other funds and accounts of the Port and shall be a trust fund for the owners of the
Series 2011B Bonds.
The Series 2011B Bonds shall be obligations only of the Series 2011B Bond Fund and
the Series 2011B Debt Service Reserve Fund or the Common Reserve Fund, as applicable, and
shall be payable and secured as provided herein. The Series 2011B Bonds do not constitute an
indebtedness of the Port within the meaning of the constitutional and statutory provisions and
limitations of the laws of the State of Washington.
The Port hereby irrevocably obligates and binds itself for so long as any Series 2011B
Bonds remain Outstanding to set aside and pay into the Series 2011B Bond Fund from Net
Revenues or money in the Revenue Fund, on or prior to the respective dates on which the same
become due:
(A) such amounts as are required to pay the interest scheduled to
become due and redemption premium, if any, on Outstanding Series 2011B Bonds; and
(B) such amounts as are required to pay maturing principal or principal
being redeemed of Outstanding Series 2011B Bonds.
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(3) Series 2011C Bond Fund. If the Series 2011C Bonds are issued, a special
fund of the Port designated the "Port of Seattle Revenue Bond Fund, Series 2011C" (the
"Series 2011C Bond Fund") is hereby authorized to be created in the office of the Treasurer for
the purpose of paying and securing the payment of the Series 2011C Bonds. The Series 2011C
Bond Fund shall be held separate and apart from all other funds and accounts of the Port and
shall be a trust fund for the owners of the Series 2011C Bonds.
The Series 2011C Bonds shall be obligations only of the Series 2011C Bond Fund and
the Series 2011C Debt Service Reserve Fund or the Common Reserve Fund, as applicable, and
shall be payable and secured as provided herein. The Series 2011C Bonds do not constitute an
indebtedness of the Port within the meaning of the constitutional and statutory provisions and
limitations of the laws of the State of Washington.
The Port hereby irrevocably obligates and binds itself for so long as any Series 2011C
Bonds remain Outstanding to set aside and pay into the Series 2011C Bond Fund from Net
Revenues or money in the Revenue Fund, on or prior to the respective dates on which the same
become due:
(A) such amounts as are required to pay the interest scheduled to
become due and redemption premium, if any, on Outstanding Series 2011C Bonds; and
(B) such amounts as are required to pay maturing principal or principal
being redeemed of Outstanding Series 2011C Bonds.
(b) Series 2011 Debt Service Reserve Funds.
(1) Series 2011A Debt Service Reserve Fund. The Bond Purchase Contract
may provide that the Series 2011A Bonds will be secured by the Common Reserve Fund.
Pursuant to the authority of this series resolution, the Chief Executive Officer is hereby
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authorized to designate the Series 2011A Bonds as Covered Bonds in the Bond Purchase
Contract approved pursuant to Section 16. In the alternative, if, pursuant to the Bond Purchase
Contract, a separate reserve will be established for the Series 2011A Bonds, a Series 2011A Debt
Service Reserve Fund (the "Series 2011A Debt Service Reserve Fund") is hereby authorized to
be created for the purpose of securing the payment of the principal of, premium, if any, and
interest on the Series 2011A Bonds. Unless otherwise specified in the Bond Purchase Contract,
the Series 2011A Debt Service Reserve Requirement shall be fully funded on the date of
issuance of the Series 2011A Bonds.
The Designated Port Representative may decide to utilize a Surety Bond to satisfy the
Series 2011A Debt Service Reserve Requirement; provided that the Surety Bond meets the
qualifications for Qualified Insurance at the time it is issued. Upon such election, the Designated
Port Representative is hereby authorized to execute and deliver a Surety Bond Agreement with a
Surety Bond Issuer to effect the delivery of the Surety Bond.
The Series 2011A Debt Service Reserve Requirement shall be maintained by deposits of
cash and/or qualified investments, a Qualified Letter of Credit or Qualified Insurance, or a
combination of the foregoing. To the extent that the Port obtains a Qualified Letter of Credit or
Qualified Insurance in substitution for cash or securities in the Series 2011A Debt Service
Reserve Fund, all or a portion of the money on hand in the Series 2011A Debt Service Reserve
Fund shall be transferred to the fund or account, specified by the Designated Port Representative
within the limitations permitted by the Federal Tax Certificate. In computing the amount on
hand in the Series 2011A Debt Service Reserve Fund, Qualified Insurance and/or a Qualified
Letter of Credit shall be valued at the lower of the face amount thereof and the amount available
to be drawn thereunder, and all other obligations purchased as an investment of moneys therein
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shall be valued on a marked to market basis, valued at least once annually. As used herein, the
term "cash" shall include U.S. currency, cash equivalents and evidences thereof, including
demand deposits, certified or cashier's check; and the deposit to the Series 2011A Debt Service
Reserve Fund may be satisfied by the transfer of qualified investments to such account. If a
deficiency in the Series 2011A Debt Service Reserve Requirement shall exist as a result of the
foregoing valuation, such deficiency shall be made up within a year after the date of such
valuation.
If the balance on hand in the Series 2011A Debt Service Reserve Fund is sufficient to
satisfy the Series 2011A Debt Service Reserve Requirement, interest earnings shall be applied as
provided in the following sentences. Whenever there is a sufficient amount in the Series 2011
Bond Fund and the Series 2011A Debt Service Reserve Fund to pay the principal of, premium, if
any, and interest on all Outstanding Series 2011A Bonds, the money in the Series 2011A Debt
Service Reserve Fund may be used to pay such principal and interest. So long as the money left
remaining on deposit in the Series 2011A Debt Service Reserve Fund is equal to the Series
2011A Debt Service Reserve Requirement, money in the Series 2011A Debt Service Reserve
Fund may be transferred to the fund or account specified in writing by the Designated Port
Representative within the limitations permitted by the Federal Tax Certificate. The Port also
may transfer out of the Series 2011A Debt Service Reserve Fund any money required to prevent
any Series 2011A Bonds from becoming "arbitrage bonds" under the Code.
If the Series 2011A Bonds are designated as Covered Bonds, the procedures for drawing
on the Common Reserve Fund are set forth in the Master Resolution. If a deficiency in the
Series 2011A Bond Fund shall occur, such deficiency shall be made up from the Series 2011A
Debt Service Reserve Fund by the withdrawal of cash therefrom for that purpose and by the sale
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or redemption of obligations held in the Series 2011A Debt Service Reserve Fund, in such
amounts as will provide cash in the Series 2011A Debt Service Reserve Fund sufficient to make
up any such deficiency with respect to the Series 2011A Bonds, and if a deficiency still exists
immediately prior to an interest payment date and after the transfer of cash from the Series
2011A Debt Service Reserve Fund to the Series 2011A Bond Fund, the Port shall then draw
from any Qualified Letter of Credit or Qualified Insurance then credited to the Series 2011A
Debt Service Reserve Fund for the Series 2011A Bonds (up to the amount then available) in
sufficient amount to make up the deficiency. Such draw shall be made at such times and under
such conditions as the agreement for such Qualified Letter of Credit or such Qualified Insurance
shall provide. Reimbursement may be made to the issuer of any Qualified Letter of Credit or
Qualified Insurance in accordance with the reimbursement agreement related thereto, and after
making necessary provision for the payments required to be made in paragraphs First and Second
of Section 2(a) of the Master Resolution. If the Port shall have failed to make any payment
required to be made under such reimbursement agreement for the Series 2011A Bonds, the issuer
shall be entitled to exercise all remedies available at law or under this series resolution; provided,
however, that no acceleration of the Series 2011A Bonds shall be permitted, and no remedies
that adversely affect Registered Owners of the Series 2011A Bonds shall be permitted. Any
deficiency created in the Series 2011A Debt Service Reserve Fund by reason of any such
withdrawal shall be made up within one year after the date of such withdrawal from Qualified
Insurance or a Qualified Letter of Credit or out of Net Revenues (or out of any other moneys on
hand legally available for such purpose), in 12 equal monthly installments, after first making
necessary provision for all payments required to be made into the Series 2011A Bond Fund
within such year.
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In making the payments and credits to the Series 2011A Debt Service Reserve Fund
required by this Section 7(b)(1), to the extent that the Port has obtained Qualified Insurance or a
Qualified Letter of Credit for specific amounts required pursuant to this section to be paid out of
the Series 2011A Debt Service Reserve Fund such amounts then available to be drawn under
such Qualified Insurance or a Qualified Letter of Credit shall be credited against the amounts
required to be maintained in the Series 2011A Debt Service Reserve Fund by this Section 7(b)(1)
to the extent that such payments and credits to be made are to be made or insured by the issuer of
such Qualified Insurance, or are to be made or guaranteed by a Qualified Letter of Credit. In the
event of termination of a Qualified Letter of Credit, if the issuer of the Qualified Insurance or the
Qualified Letter of Credit shall be insolvent or no longer in existence or if the letter of credit or
insurance otherwise ceases to be a Qualified Letter of Credit or Qualified Insurance,
respectively, the Series 2011A Debt Service Reserve Requirement shall be satisfied (A) within
one year after the termination, insolvency or incapacity, with other Qualified Insurance or
another Qualified Letter of Credit, or (B) within three years (in three equal annual installments)
after the termination, insolvency or incapacity, out of Net Revenues (or out of other money on
hand and legally available for such purpose) after first making necessary provisions for all
payments required to be made into the Series 2011A Bond Fund.
(2) Series 2011B Debt Service Reserve Fund. The Bond Purchase Contract
may provide that the Series 2011B Bonds will be secured by the Common Reserve Fund.
Pursuant to the authority of this series resolution, the Chief Executive Officer is hereby
authorized to designate the Series 2011B Bonds as Covered Bonds in the Bond Purchase
Contract approved pursuant to Section 16. In the alternative, if, pursuant to the Bond Purchase
Contract, a separate reserve will be established for the Series 2011B Bonds, a Series 2011B Debt
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Service Reserve Fund (the "Series 2011B Debt Service Reserve Fund") is hereby authorized to
be created for the purpose of securing the payment of the principal of, premium, if any, and
interest on the Series 2011B Bonds. Unless otherwise specified in the Bond Purchase Contract,
the Series 2011B Debt Service Reserve Requirement shall be fully funded on the date of
issuance of the Series 2011B Bonds.
The Designated Port Representative may decide to utilize a Surety Bond to satisfy the
Series 2011B Debt Service Reserve Requirement; provided that the Surety Bond meets the
qualifications for Qualified Insurance at the time it is issued. Upon such election, the Designated
Port Representative is hereby authorized to execute and deliver a Surety Bond Agreement with a
Surety Bond Issuer to effect the delivery of the Surety Bond.
The Series 2011B Debt Service Reserve Requirement shall be maintained by deposits of
cash and/or qualified investments, a Qualified Letter of Credit or Qualified Insurance, or a
combination of the foregoing. To the extent that the Port obtains a Qualified Letter of Credit or
Qualified Insurance in substitution for cash or securities in the Series 2011B Debt Service
Reserve Fund, all or a portion of the money on hand in the Series 2011B Debt Service Reserve
Fund shall be transferred to the fund or account, specified by the Designated Port Representative.
In computing the amount on hand in the Series 2011B Debt Service Reserve Fund, Qualified
Insurance and/or a Qualified Letter of Credit shall be valued at the lower of the face amount
thereof and the amount available to be drawn thereunder, and all other obligations purchased as
an investment of moneys therein shall be valued on a marked to market basis, valued at least
once annually. As used herein, the term "cash" shall include U.S. currency, cash equivalents and
evidences thereof, including demand deposits, certified or cashier's check; and the deposit to the
Series 2011B Debt Service Reserve Fund may be satisfied by the transfer of qualified
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investments to such account. If a deficiency in the Series 2011B Debt Service Reserve
Requirement shall exist as a result of the foregoing valuation, such deficiency shall be made up
within a year thereof.
If the balance on hand in the Series 2011B Debt Service Reserve Fund is sufficient to
satisfy the Series 2011B Debt Service Reserve Requirement, interest earnings shall be applied as
provided in the following sentences. Whenever there is a sufficient amount in the Series 2011
Bond Fund and the Series 2011B Debt Service Reserve Fund to pay the principal of, premium, if
any, and interest on all Outstanding Series 2011B Bonds, the money in the Series 2011B Debt
Service Reserve Fund may be used to pay such principal and interest. So long as the money left
remaining on deposit in the Series 2011B Debt Service Reserve Fund is equal to the
Series 2011B Debt Service Reserve Requirement, money in the Series 2011B Debt Service
Reserve Fund may be transferred to the fund or account specified in writing by the Designated
Port Representative.
If the Series 2011B Bonds are designated as Covered Bonds, the procedures for drawings
on the Common Reserve Fund are set forth in the Master Resolution. If a deficiency in the
Series 2011B Bond Fund shall occur, such deficiency shall be made up from the Series 2011B
Debt Service Reserve Fund by the withdrawal of cash therefrom for that purpose and by the sale
or redemption of obligations held in the Series 2011B Debt Service Reserve Fund, in such
amounts as will provide cash in the Series 2011B Debt Service Reserve Fund sufficient to make
up any such deficiency with respect to the Series 2011B Bonds, and if a deficiency still exists
immediately prior to an interest payment date and after the transfer of cash from the Series
2011B Debt Service Reserve Fund to the Series 2011B Bond Fund, the Port shall then draw from
any Qualified Letter of Credit or Qualified Insurance then credited to the Series 2011B Debt
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Service Reserve Fund for the Series 2011B Bonds (up to the amount then available) in sufficient
amount to make up the deficiency. Such draw shall be made at such times and under such
conditions as the agreement for such Qualified Letter of Credit or such Qualified Insurance shall
provide. Reimbursement may be made to the issuer of any Qualified Letter of Credit or
Qualified Insurance in accordance with the reimbursement agreement related thereto, and after
making necessary provision for the payments required to be made in paragraphs First and Second
of Section 2(a) of the Master Resolution. If the Port shall have failed to make any payment
required to be made under such reimbursement agreement for the Series 2011B Bonds, the issuer
shall be entitled to exercise all remedies available at law or under this series resolution; provided,
however, that no acceleration of the Series 2011B Bonds shall be permitted, and no remedies that
adversely affect Registered Owners of the Series 2011B Bonds shall be permitted. Any
deficiency created in the Series 2011B Debt Service Reserve Fund by reason of any such
withdrawal shall be made up within one year after the date of such withdrawal from Qualified
Insurance or a Qualified Letter of Credit or out of Net Revenues (or out of any other moneys on
hand legally available for such purpose), in 12 equal monthly installments, after first making
necessary provision for all payments required to be made into the Series 2011B Bond Fund
within such year.
In making the payments and credits to the Series 2011B Debt Service Reserve Fund
required by this Section 7(b)(2), to the extent that the Port has obtained Qualified Insurance or a
Qualified Letter of Credit for specific amounts required pursuant to this section to be paid out of
the Series 2011B Debt Service Reserve Fund such amounts then available to be drawn under
such Qualified Insurance or a Qualified Letter of Credit shall be credited against the amounts
required to be maintained in the Series 2011B Debt Service Reserve Fund by this Section 7(b)(2)
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to the extent that such payments and credits to be made are to be made or insured by the issuer of
such Qualified Insurance, or are to be made or guaranteed by a Qualified Letter of Credit. In the
event of termination of a Qualified Letter of Credit, if the issuer of the Qualified Insurance or the
Qualified Letter of Credit shall be insolvent or no longer in existence or if the letter of credit or
insurance otherwise ceases to be a Qualified Letter of Credit or Qualified Insurance,
respectively, the Series 2011B Debt Service Reserve Requirement shall be satisfied (A) within
one year after the termination, insolvency or incapacity, with other Qualified Insurance or
another Qualified Letter of Credit, or (B) within three years (in three equal annual installments)
after the termination, insolvency or incapacity, out of Net Revenues (or out of other money on
hand and legally available for such purpose) after first making necessary provisions for all
payments required to be made into the Series 2011B Bond Fund.
(3) Series 2011C Debt Service Reserve Fund. The Bond Purchase Contract
may provide that the Series 2011C Bonds, if issued, will be secured by the Common Reserve
Fund. Pursuant to the authority of this series resolution, the Chief Executive Officer is hereby
authorized to designate the Series 2011C Bonds as Covered Bonds in the Bond Purchase
Contract approved pursuant to Section 16. In the alternative, if, pursuant to the Bond Purchase
Contract, a separate reserve will be established for the Series 2011C Bonds, a Series 2011C Debt
Service Reserve Fund (the "Series 2011C Debt Service Reserve Fund") is hereby authorized to
be created for the purpose of securing the payment of the principal of, premium, if any, and
interest on the Series 2011C Bonds. Unless otherwise specified in the Bond Purchase Contract,
the Series 2011C Debt Service Reserve Requirement shall be fully funded on the date of
issuance of the Series 2011C Bonds.
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The Designated Port Representative may decide to utilize a Surety Bond to satisfy the
Series 2011C Debt Service Reserve Requirement; provided that the Surety Bond meets the
qualifications for Qualified Insurance at the time it is issued. Upon such election, the Designated
Port Representative is hereby authorized to execute and deliver a Surety Bond Agreement with a
Surety Bond Issuer to effect the delivery of the Surety Bond.
The Series 2011C Debt Service Reserve Requirement shall be maintained by deposits of
cash and/or qualified investments, a Qualified Letter of Credit or Qualified Insurance, or a
combination of the foregoing. To the extent that the Port obtains a Qualified Letter of Credit or
Qualified Insurance in substitution for cash or securities in the Series 2011C Debt Service
Reserve Fund, all or a portion of the money on hand in the Series 2011C Debt Service Reserve
Fund shall be transferred to the fund or account, specified by the Designated Port Representative.
In computing the amount on hand in the Series 2011C Debt Service Reserve Fund, Qualified
Insurance and/or a Qualified Letter of Credit shall be valued at the lower of the face amount
thereof and the amount available to be drawn thereunder, and all other obligations purchased as
an investment of moneys therein shall be valued on a marked to market basis, valued at least
once annually. As used herein, the term "cash" shall include U.S. currency, cash equivalents and
evidences thereof, including demand deposits, certified or cashier's check; and the deposit to the
Series 2011C Debt Service Reserve Fund may be satisfied by the transfer of qualified
investments to such account. If a deficiency in the Series 2011C Debt Service Reserve
Requirement shall exist as a result of the foregoing valuation, such deficiency shall be made up
within a year thereof.
If the balance on hand in the Series 2011C Debt Service Reserve Fund is sufficient to
satisfy the Series 2011C Debt Service Reserve Requirement, interest earnings shall be applied as
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provided in the following sentences. Whenever there is a sufficient amount in the Series 2011
Bond Fund and the Series 2011C Debt Service Reserve Fund to pay the principal of, premium, if
any, and interest on all Outstanding Series 2011C Bonds, the money in the Series 2011C Debt
Service Reserve Fund may be used to pay such principal and interest. So long as the money left
remaining on deposit in the Series 2011C Debt Service Reserve Fund is equal to the
Series 2011C Debt Service Reserve Requirement, money in the Series 2011C Debt Service
Reserve Fund may be transferred to the fund or account specified in writing by the Designated
Port Representative.
If the Series 2011C Bonds are designated as Covered Bonds, the procedures for drawings
on the Common Reserve Fund are set forth in the Master Resolution. If a deficiency in the
Series 2011C Bond Fund shall occur, such deficiency shall be made up from the Series 2011C
Debt Service Reserve Fund by the withdrawal of cash therefrom for that purpose and by the sale
or redemption of obligations held in the Series 2011C Debt Service Reserve Fund, in such
amounts as will provide cash in the Series 2011C Debt Service Reserve Fund sufficient to make
up any such deficiency with respect to the Series 2011C Bonds, and if a deficiency still exists
immediately prior to an interest payment date and after the transfer of cash from the Series
2011C Debt Service Reserve Fund to the Series 2011C Bond Fund, the Port shall then draw from
any Qualified Letter of Credit or Qualified Insurance then credited to the Series 2011C Debt
Service Reserve Fund for the Series 2011C Bonds (up to the amount then available) in sufficient
amount to make up the deficiency. Such draw shall be made at such times and under such
conditions as the agreement for such Qualified Letter of Credit or such Qualified Insurance shall
provide. Reimbursement may be made to the issuer of any Qualified Letter of Credit or
Qualified Insurance in accordance with the reimbursement agreement related thereto, and after
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making necessary provision for the payments required to be made in paragraphs First and Second
of Section 2(a) of the Master Resolution. If the Port shall have failed to make any payment
required to be made under such reimbursement agreement for the Series 2011C Bonds, the issuer
shall be entitled to exercise all remedies available at law or under this series resolution; provided,
however, that no acceleration of the Series 2011C Bonds shall be permitted, and no remedies that
adversely affect Registered Owners of the Series 2011C Bonds shall be permitted. Any
deficiency created in the Series 2011C Debt Service Reserve Fund by reason of any such
withdrawal shall be made up within one year after the date of such withdrawal from Qualified
Insurance or a Qualified Letter of Credit or out of Net Revenues (or out of any other moneys on
hand legally available for such purpose), in 12 equal monthly installments, after first making
necessary provision for all payments required to be made into the Series 2011C Bond Fund
within such year.
In making the payments and credits to the Series 2011C Debt Service Reserve Fund
required by this Section 7(b)(2), to the extent that the Port has obtained Qualified Insurance or a
Qualified Letter of Credit for specific amounts required pursuant to this section to be paid out of
the Series 2011C Debt Service Reserve Fund such amounts then available to be drawn under
such Qualified Insurance or a Qualified Letter of Credit shall be credited against the amounts
required to be maintained in the Series 2011C Debt Service Reserve Fund by this Section 7(b)(2)
to the extent that such payments and credits to be made are to be made or insured by the issuer of
such Qualified Insurance, or are to be made or guaranteed by a Qualified Letter of Credit. In the
event of termination of a Qualified Letter of Credit, if the issuer of the Qualified Insurance or the
Qualified Letter of Credit shall be insolvent or no longer in existence or if the letter of credit or
insurance otherwise ceases to be a Qualified Letter of Credit or Qualified Insurance,
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respectively, the Series 2011C Debt Service Reserve Requirement shall be satisfied (A) within
one year after the termination, insolvency or incapacity, with other Qualified Insurance or
another Qualified Letter of Credit, or (B) within three years (in three equal annual installments)
after the termination, insolvency or incapacity, out of Net Revenues (or out of other money on
hand and legally available for such purpose) after first making necessary provisions for all
payments required to be made into the Series 2011C Bond Fund.
(c) Pledge and Lien. The Port does hereby pledge and bind itself to set aside from
Net Revenues, and to pay into the Series 2011A Bond Fund, the Series 2011B Bond Fund, the
Series 2011C Bond Fund, the Common Reserve Fund or the Series 2011A Debt Service Reserve
Fund, the Series 2011B Debt Service Reserve Fund and the Series 2011C Debt Service Reserve
Fund, as applicable, the various amounts required herein to be paid into and maintained in said
Funds, all within the times provided herein. Said amounts so pledged to be paid into the Series
2011A Bond Fund, the Series 2011B Bond Fund, the Series 2011C Bond Fund, the Common
Reserve Fund or the Series 2011A Debt Service Reserve Fund, the Series 2011B Debt Service
Reserve Fund and the Series 2011C Debt Service Reserve Fund, as applicable, are hereby
declared to be an equal and prior lien and charge upon Gross Revenues superior to all other
charges of any kind or nature whatsoever, except for Operating Expenses and except that the
amounts so pledged are of equal lien to the lien and charge thereon of the Outstanding Parity
Bonds, and to any lien and charge thereon which may hereafter be made to pay and secure the
payment of the principal of, premium, if any, and interest on any Future Parity Bonds.
(d) Use of Excess Money. Money in the Series 2011A Bond Fund, t he Series 2011B
Bond Fund or the Series 2011C Bond Fund not needed to pay the interest or principal and
interest next coming due on any Outstanding Series 2011 Bonds or to maintain required reserves
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therefor may be used to purchase or redeem and retire Series 2011 Bonds within the limitations
provided herein, subject to the further limitations set forth in the Federal Tax Certificate with
respect to Series 2011 Bonds issued on a tax-exempt basis, and in Section 2 of the Master
Resolution. Money in the Series 2011A Bond Fund, the Series 2011B Bond Fund and the
Series2011C Bond Fund, the Series 2011A Debt Service Reserve Fund (if any), the Series 2011B
Debt Service Reserve Fund (if any), the Series 2011C Debt Service Reserve Fund (if any) and
money in the Revenue Fund of the Port may be invested in any investments legal for port
districts and, with respect to the Series 2011A Bond Fund, the Series 2011B Bond Fund, the
Series 2011C Bond Fund, the Series 2011A Debt Service Reserve Fund, the Series 2011B Debt
Service Reserve Fund, and the Series 2011C Debt Service Reserve Fund, subject to the further
limitations set forth in the Federal Tax Certificate with respect to the Series 2011 Bonds issued
on a tax-exempt basis.
(e) Surety Bond Agreement. The Designated Port Representative may solicit bids
from surety bond issuers, and the Designated Port Representative is hereby authorized to select a
proposal and to execute the Surety Bond Agreement(s), which may include such covenants and
conditions as shall be approved by the Designated Port Representative.
Section 8. Defeasance. Except as otherwise set forth in the Bond Purchase Contract,
one or more series of the Series 2011 Bonds shall be subject to defeasance as follows. In the
event that money and/or noncallable Government Obligations maturing or having guaranteed
redemption prices at the option of the owner thereof at such time or times and bearing interest to
be earned thereon in amounts (together with such money, if any) sufficient to redeem and retire
part or all of the Series 2011 Bonds of any series in accordance with their terms, are hereafter
irrevocably set aside in a special account and pledged to effect such redemption and retirement,
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and, if the Series 2011 Bonds (or portion thereof) of such series are to be redeemed prior to
maturity, irrevocable notice, or irrevocable instructions to give notice of such redemption has
been delivered to the Registrar, then no further payments need be made into the applicable Series
2011A Bond Fund, Series 2011B Bond Fund or Series 2011C Bond Fund or any account therein
for the payment of the principal of, premium, if any, and interest on such Series 2011 Bonds (or
portion thereof) so provided for and the Series 2011 Bonds of such series shall then cease to be
entitled to any lien, benefit or security of the Master Resolution or this series resolution, except
the right to receive the funds so set aside and pledged and such notices of redemption, if any, and
such Series 2011 Bonds (or portion thereof) shall no longer be deemed to be Outstanding
hereunder, under the Master Resolution or under any resolution authorizing the issuance of
bonds or other indebtedness of the Port.
The Port shall provide notice of defeasance of Series 2011 Bonds to Registered Owners
of Series 2011 Bonds being defeased, to the Bond Insurer, if any, and to each party entitled to
receive notice under the Continuing Disclosure Certificate authorized pursuant to Section 18.
Section 9. Refunding Procedures.
(a) Application of Series 2011 Bond Proceeds. The net proceeds of the Series 2011
Bonds (exclusive of any amounts that may be designated by the Designated Port Representative
in a closing certificate to be allocated to pay costs of issuance or any Bond Insurance Policy
premium or to satisfy a portion of the Series 2011A Debt Service Reserve Requirement, the
Series 2011B Debt Service Reserve Requirement and/or the Series 2011C Debt Service Reserve
Requirement), together with other available funds of the Port in the amount specified by the
Designated Port Representative, shall be utilized immediately upon receipt thereof to pay and
redeem the Refunded Bonds or shall be paid at the direction of the Treasurer to the Escrow
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Agent (if the Designated Port Representative has determined that an escrow would be necessary
or desirable to effect the defeasance of all or a portion of the Refunded Bonds).
(b) Defeasance of Refunded Bonds. Subject to and in accordance w ith the resolutions
authorizing the issuance of the Refunded Bonds, the net proceeds of the Series 2011 Bonds so
deposited shall be utilized immediately upon receipt thereof to pay and redeem the Refunded
Bonds or to purchase the Government Obligations specified by the Designated Port
Representative (which obligations so purchased, are herein called "Acquired Obligations") and
to maintain such necessary beginning cash balance to defease the Refunded Bonds and to
discharge the other obligations of the Port relating thereto under the resolutions authorizing their
issuance, by providing for the payment of the interest on the Refunded Bonds to the dates fixed
for redemption and the redemption price (the principal amount) on the redemption dates for the
Refunded Bonds. And subject to compliance with all conditions set forth in the respective
resolutions authorizing the issuance of the Refunded Bonds, when the final transfers have been
made for the payment of such redemption price and interest on the Refunded Bonds, any balance
then remaining shall be transferred to the account designated by the Port and used for the
purposes specified by the Designated Port Representative.
(c) Acquired Obligations. The Acquired Obligations, if any, shall be payable in such
amounts and at such times that, together with any necessary beginning cash balance, will be
sufficient to provide for the payment of:
(1) the interest on the Refunded Bonds as such becomes due on and before the
dates fixed for redemption of the Refunded Bonds; and
(2) the price of redemption of the Refunded Bonds on the dates fixed for
redemption of the Refunded Bonds.
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(d) Authorizing Appointment of Escrow Agent. The Commission hereby authorizes
and directs the Designated Port Representative (if the Designated Port Representative determines
that an escrow would be necessary or desirable to effect the defeasance of all or a portion of the
Refunded Bonds) to select a financial institution to act as the escrow agent for all or a portion of
the Refunded Bonds (the "Escrow Agent").
Section 10. Redemption of Refunded Bonds. The Commission hereby calls the
Refunded Bonds for redemption on the redemption dates specified by the Designated Port
Representative in accordance with the provisions of the resolutions authorizing the issuance,
redemption and retirement of the Refunded Bonds, respectively, prior to their fixed maturities.
The Designated Port Representative may cause to be disseminated a conditional notice of
redemption prior to the closing and delivery of the Series 2011 Bonds.
Said defeasance and call for redemption of the Refunded Bonds shall be irrevocable after
the closing and delivery of the Series 2011 Bonds.
If so appointed, the Escrow Agent shall be authorized and directed to provide for the
giving of irrevocable notice of the redemption of the Refunded Bonds in accordance with the
terms of resolutions authorizing the issuance of the Refunded Bonds and as described in the
Escrow Agreement. The Treasurer is authorized and directed to provide whatever assistance is
necessary to accomplish such redemption and the giving of notice therefor. The costs of mailing
of such notice shall be an expense of the Port.
The Port or the Escrow Agent on behalf of the Port shall be authorized and directed to
pay to the fiscal agency or agencies of the State of Washington, sums sufficient to pay, when
due, the payments specified in Section 9(c) of this series resolution. All such sums shall be paid
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from the moneys and the Acquired Obligations pursuant to the previous section of this series
resolution, and the income therefrom and proceeds thereof.
If an Escrow Agent is appointed, the Port will ascertain that all necessary and proper fees,
compensation and expenses of the Escrow Agent for the Refunded Bonds shall be paid when
due. If an Escrow Agent is appointed, the Designated Port Representative is authorized and
directed to execute and deliver the Escrow Agreement to the Escrow Agent when the provisions
thereof have been fixed and determined for closing and delivery of the Series 2011 Bonds. The
Escrow Agreement, if any, shall be substantially in the form of Exhibit B attached to this series
resolution and by this reference hereby made a part of this series resolution.
Section 11. Tax Covenants.
The Port covenants that it will not take or permit to be taken on its behalf any action that
would adversely affect the exclusion from gross income for federal income tax purposes of the
interest on the Series 2011 Bonds issued on a tax-exempt basis and will take or require to be
taken such acts as may reasonably be within its ability and as may from time to time be required
under applicable law to continue the exclusion from gross income for federal income tax
purposes of the interest on such Series 2011 Bonds. The Port shall comply with its covenants set
forth in the Federal Tax Certificate.
Section 12. Lost, Stolen, Mutilated or Destroyed Series 2011 Bonds. In case any
Series 2011 Bond shall be lost, stolen, mutilated or destroyed, the Registrar may execute and
deliver a new Series 2011 Bond of like series, date, number and tenor to the Registered Owner
thereof upon the owner's paying the expenses and charges of the Port in connection therewith
and upon his/her filing with the Port evidence satisfactory to the Port that such Series 2011 Bond
was actually lost, stolen or destroyed (including the presentation of a mutilated Series
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2011 Bond) and of his/her ownership thereof, and upon furnishing the Port and the Registrar
with indemnity satisfactory to both.
Section 13. Form of Series 2011 Bonds and Registration Certificate.
(a) Series 2011 Bonds. The Series 2011 Bonds shall be in substantially the following
form with modifications to reflect a particular series:
[STATEMENT OF INSURANCE, if any]
[DTC LEGEND]
UNITED STATES OF AMERICA
NO. ______ $____________
STATE OF WASHINGTON
PORT OF SEATTLE
REVENUE REFUNDING BOND, SERIES 2011[A/B/C]
Maturity Date: _________, _____ CUSIP No. _______
Interest Rate:
Registered Owner: Cede & Co.
Principal Amount:
THE PORT OF SEATTLE, a municipal corporation organized and existing under and by
virtue of the laws of the State of Washington (the "Port"), promises to pay to the Registered
Owner identified above, or registered assigns, on the Maturity Date identified above, solely from
the special fund of the Port known as the "Port of Seattle Revenue Bond Fund,
Series 2011[A/B/C]" (the "Series 2011[A/B/C] Bond Fund") created by Resolution No. ____, as
amended (together with Resolution No. 3059, as amended, and as amended and restated by
Resolution No. 3577, hereinafter collectively referred to as the "Bond Resolution") the Principal
Amount indicated above and to pay interest thereon from the Series 2011 Bond Fund[A/B/C]
from the date of initial delivery, or the most recent date to which interest has been paid or duly
provided for or until payment of this bond at the Interest Rate set forth above, payable
semiannually on the first days of each _______ and _________ beginning on _______________.
Except as otherwise provided in the Bond Resolution], the principal of, premium, if any, and
interest on this bond are payable in lawful money of the United States of America. Both
principal and interest shall be paid as provided in the Blanket Issuer Letter of Representations
(the "Letter of Representations") by the Port to The Depository Trust Company ("DTC").
Capitalized terms used in this bond which are not specifically defined have the meanings given
such terms in the Bond Resolution. The Treasurer of the Port has appointed the fiscal agent for
the State of Washington as the initial registrar, authenticating and paying agent for the bonds of
this series.
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This bond is one of a series of bonds of the Port in the aggregate principal amount of
$__________, of like date, tenor and effect, except as to number, amount, rate of interest and
date of maturity, and is issued pursuant to the Bond Resolution to refund certain outstanding
revenue bonds. Simultaneously herewith, the Port is issuing its Revenue Bonds,
Series 2011[A/B/C] [AMT][Taxable] in the principal amount of $_________.
The bonds of this issue maturing on and prior to ____________ are not subject to
redemption in advance of their scheduled maturity. The bonds of this issue maturing on and
after _____________ are subject to redemption at the option of the Port on and after
___________ in whole or in part on any date, and if in part, with maturities to be selected by the
Port at the price of 100% of the principal amount thereof plus accrued interest to the date fixed
for redemption.
[The bonds of this series are/are not private activity bonds.] The bonds of this series are
not "qualified tax-exempt obligations" eligible for investment by financial institutions within the
meaning of Section 265(b) of the Internal Revenue Code of 1986, as amended. [The Port has
taken no action to cause the interest on this bond to be tax-exempt.]
So long as this bond is held by DTC or its nominee, the manner of selection of bonds of
this issue within a maturity for redemption and transfer of bonds and the provision of notice of
redemption shall be governed by the Letter of Representations and DTC's operational
arrangements. Except as provided in the Bond Resolution, the Port and Registrar shall deem the
person in whose name this bond is registered to be the absolute owner hereof for the purpose of
receiving payment of the principal of, premium, if any, and interest on the bond and for any and
all other purposes whatsoever.
The Port hereby covenants and agrees with the owner and holder of this bond that it will
keep and perform all the covenants of this bond and the Bond Resolution.
The Port does hereby pledge and bind itself to set aside from Gross Revenue after
payment of Operating Expenses, and to pay into the Series 2011[A/][B][C] Bond Fund and the
Series 2011[A][B][C] Reserve Fund the various amounts required by the Bond Resolution to be
paid into and maintained in such Funds, all within the times provided by said Bond Resolution.
Said amounts so pledged to be paid out of Gross Revenue into the Series 2011[A][B][C]
Bond Fund and [Series 2011[A][B][C] Debt Service Reserve Fund][Common Reserve Fund] are
hereby declared to be a first and prior lien and charge upon the Gross Revenue, subject to
payment of the Operating Expenses of the Port and equal in rank to the lien and charge upon
such Gross Revenue of the amounts required to pay and secure the payment of the Outstanding
Parity Bonds, the Series 2011[A][B][C] Bonds and any revenue bonds of the Port hereafter
issued on a parity with the bonds of this issue.
The Port has further bound itself to maintain all of its properties and facilities that
contribute in some measure to such Gross Revenue in good repair, working order and condition,
to operate the same in an efficient manner and at a reasonable cost, and to establish, maintain and
collect rentals, tariffs, rates and charges in the operation of all of its business for as long as any
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bonds of this issue are outstanding that it will make available, for the payment of the principal
thereof and interest thereon as the same shall become due, Net Revenues (as the same are
defined in the Bond Resolution) in an amount equal to or greater than the Rate Covenant defined
in the Master Resolution.
This bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Bond Resolution until the Certificate of Authentication hereon shall
have been manually signed by or on behalf of the Registrar.
It is hereby certified and declared that this bond and the bonds of this issue are issued
pursuant to and in strict compliance with the Constitution and laws of the State of Washington
and resolutions of the Port and that all acts, conditions and things required to be done precedent
to and in the issuance of this bond have happened, been done and performed.
IN WITNESS WHEREOF, the Port of Seattle has caused this bond to be executed by the
manual or facsimile signatures of the President and Secretary of the Port Commission, and the
corporate seal of the Port to be impressed or a facsimile thereof imprinted or otherwise
reproduced hereon as of the ____ day of __________, 2011.
PORT OF SEATTLE
By /s/
President, Port Commission
ATTEST:
/s/
Secretary, Port Commission
CERTIFICATE OF AUTHENTICATION
Date of Authentication: _______________
This bond is one of the bonds described in the within mentioned Bond Resolution and is
one of the Revenue Refunding Bonds, Series 2011[A/B/C] [AMT][Taxable] of the Port of
Seattle, dated ____________, 2011.
WASHINGTON STATE FISCAL AGENCY, as
Registrar
By
Authorized Signer
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In the event any Series 2011 Bonds are no longer in fully immobilized form, the form of
such Series 2011 Bonds may be modified to conform to printing requirements and the terms of
this series resolution.
Section 14. Execution. The Series 2011 Bonds shall be executed on behalf of the Port
with the manual or facsimile signature of the President of its Commission, shall be attested by
the manual or facsimile signature of the Secretary thereof and shall have the seal of the Port
impressed or a facsimile thereof imprinted or otherwise reproduced thereon.
Only such Series 2011 Bonds as shall bear thereon a Certificate of Authentication in the
form hereinbefore recited, manually executed by the Registrar, shall be valid or obligatory for
any purpose or entitled to the benefits of this series resolution. Such Certificate of
Authentication shall be conclusive evidence that the Series 2011 Bonds so authenticated have
been duly executed, authenticated and delivered hereunder and are entitled to the benefits of this
series resolution.
In case either of the officers of the Port who shall have executed the Series 2011 Bonds
shall cease to be such officer or officers of the Port before the Series 2011 Bonds so signed shall
have been authenticated or delivered by the Registrar, or issued by the Port, such Series 2011
Bonds may nevertheless be authenticated, delivered and issued and upon such authentication,
delivery and issuance, shall be as binding upon the Port as though those who signed the same had
continued to be such officers of the Port. Any Series 2011 Bond may also be signed and attested
on behalf of the Port by such persons as at the actual date of execution of such Series 2011 Bond
shall be the proper officers of the Port although at the original date of such Series 2011 Bond any
such person shall not have been such officer.
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Section 15. Additional Covenant; Defaults and Remedies.
(a) Disposal of Income Properties. In the event of voluntary or involuntary sale,
lease, or other conveyance, transfer or disposal of all or substantially all of the marine and
aviation properties, assets or facilities, the Port shall require that contemporaneously with such
disposition, there shall be paid into a special fund a sum which shall be sufficient to defease all
Series 2011 Bonds then Outstanding; provided, however, that such defeasance will not be
required so long as the Port maintains primary responsibility for the management and operation
of the affected facilities and provided further that all Gross Revenue from such facilities
continues to be pledged to all Series 2011 Bonds then Outstanding.
(b) Defaults and Remedies. The Port hereby finds and determines that the failure or
refusal of the Port or any of its officers to perform the covenants and obligations of this series
resolution will endanger the operation of the Facilities and the application of Gross Revenue and
such other moneys, funds and securities to the purposes herein set forth. Any one or more of the
following shall constitute a Default under this series resolution:
(1) The Port shall fail to make payment of the principal of any Series 2011
Bond when the same shall become due and payable whether by maturity or scheduled
redemption prior to maturity; or
(2) The Port shall fail to make payments of any installment of interest on any
Series 2011 Bond when the same shall become due and payable; or
(3) The Port shall default in the observance or performance of any other
covenants other than conditions, or agreements on the part of the Port contained in Section 17 of
this series resolution, and such default shall have continued for a period of 90 days.
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In determining whether a payment default has occurred or whether a payment on the
Series 2011 Bonds has been made under this series resolution, no effect shall be given to
payments made under the Bond Insurance Policy, if any. Upon the occurrence and continuation
of any Default, the Registered Owners of the Series 2011 Bonds shall be entitled to exercise the
remedies specified in Section 21 of the Master Resolution; but only with respect to the
Series 2011 Bonds.
Section 16. Designation of Refunded Bonds; Sale of Series 2011 Bonds.
(a) Designation of Refunded Bonds. As outlined in Section 2 and Section 10 of this
series resolution, the Refunding Candidates may be called for redemption prior to their scheduled
maturities. All or some of the Refunding Candidates may be refunded with the proceeds of the
Series 2011 Bonds authorized by this series resolution. The Chief Executive Officer may select
some or all of the Refunding Candidates and designate those Refunding Candidates as the
"Refunded Bonds" in the Bond Purchase Contract if and to the extent that the net present value
aggregate savings with respect to all Refunded Bonds to be realized as a result of the refunding
of the Refunded Bonds, after payment of all costs of issuance of the allocable Series 2011
Bonds), is at least equal to the Savings Target.
(b) Series 2011 Bond Sale. The Series 2011 Bonds shall be sold at negotiated sale to
the Underwriters pursuant to the terms of the Bond Purchase Contract. The Chief Executive
Officer is hereby authorized to negotiate terms for the purchase of the Series 2011 Bonds and to
execute the Bond Purchase Contract, with such terms (including the designation of the Refunded
Bonds) as are approved by the Designated Port Representative pursuant to this section and
consistent with this series resolution and the Master Resolution. The Port Commission has been
advised by the Port's financial advisor that market conditions are fluctuating and, as a result, the
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most favorable market conditions may occur on a day other than a regular meeting date of the
Commission. The Commission has determined that it would be in the best interest of the Port to
delegate to the Chief Executive Officer for a limited time the authority to approve the number of
series, final series designations, and with respect to each series, the final interest rates, maturity
dates, aggregate principal amount, principal amounts and prices of each maturity, redemption
rights, and other terms and conditions of the Series 2011 Bonds. The Chief Executive Officer is
hereby authorized to approve the number of series, final series designations and with respect to
each series, the final interest rates, maturity dates, aggregate principal amount, principal amounts
of each maturity and redemption rights for the Series 2011 Bonds in the manner provided
hereafter so long as the aggregate principal amount of the Series 2011 Bonds does not exceed the
maximum principal amounts set forth in Section 3 and so long as the Savings Target is met (as
described in subsection (a) of this Section 16).
In determining the number of series, final series designations, final interest rates, maturity
dates, aggregate principal amount, principal maturities, redemption rights or provisions of the
Series 2011 Bonds, the Designated Port Representative, in consultation with Port staff and the
Port's financial advisor, shall take into account those factors that, in his judgment, will result in
the lowest true interest cost on the Series 2011 Bonds to their maturity, including, but not limited
to current financial market conditions and current interest rates for obligations comparable in
tenor and quality to the Series 2011 Bonds. Subject to the terms and conditions set forth in this
section, the Designated Port Representative is hereby authorized to execute the final form of the
Bond Purchase Contract, upon the Chief Executive Officer's approval of the RefundedBonds,
number of series, final series designation, final interest rates, maturity dates, aggregate principal
amount, principal maturities and redemption rights set forth therein. Following the execution of
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the Bond Purchase Contract, the Chief Executive Officer shall provide a report to the
Commission, describing the final terms of the Series 2011 Bonds approved pursuant to the
authority delegated in this section. The authority granted to the Designated Port Representative
and the Chief Executive Officer by this section shall expire on April 25, 2012. If a Bond
Purchase Contract for the Series 2011 Bonds has not been executed by April 25, 2012, the
authorization for the issuance of the Series 2011 Bonds shall be rescinded, and the Series 2011
Bonds shall not be issued nor their sale approved unless the Series 2011 Bonds shall have been
re-authorized by resolution of the Commission. The resolution reauthorizing the issuance and
sale of the Series 2011 Bonds may be in the form of a new series resolution repealing this series
resolution in whole or in part (only with respect to the Series 2011 Bonds not issued) or may be
in the form of an amendatory resolution approving a bond purchase contract or establishing
terms and conditions for the authority delegated under this section.
Upon the adoption of this series resolution, the proper officials of the Port including the
Designated Port Representative, are authorized and directed to undertake all other actions
necessary for the prompt execution and delivery of the Series 2011 Bonds to the Underwriters
thereof and further to execute all closing certificates and documents required to effect the closing
and delivery of the Series 2011 Bonds in accordance with the terms of the Bond Purchase
Contract.
The Designated Port Representative is authorized to ratify and to approve for purposes of
the Rule, on behalf of the Port, the Official Statement (and any Preliminary Official Statement)
and any supplement thereto relating to the issuance and sale of the Series 2011 Bonds and the
distribution of the Series 2011 Bonds pursuant thereto with such changes, if any, as may be
deemed by him/her to be appropriate.
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The Designated Port Representative and other Port officials, agents and representatives
are hereby authorized and directed to do everything necessary for the prompt issuance, execution
and delivery of the Series 2011 Bonds to the Underwriters and for the proper application and use
of the proceeds of sale of the Series 2011 Bonds. In furtherance of the foregoing, the Designated
Port Representative is authorized to approve and enter into agreements for the payment of costs
of issuance, including Underwriters' discount, the fees and expenses specified in the Bond
Purchase Contract, including fees and expenses of Underwriters and other retained services,
including Bond Counsel, rating agencies, fiscal agency, escrow agent, financial advisory
services, escrow structuring services and other expenses customarily incurred in connection with
issuance and sale of bonds.
The Designated Port Representative is authorized to ratify, executive, deliver and
approve for purposes of the Rule, on behalf of the Port, the Official Statement (and to approve,
deem final and deliver any Preliminary Official Statement) and any supplement thereto relating
to the issuance and sale of the Series 2011 Bonds and the distribution of the Series 2011 Bonds
pursuant thereto with such changes, if any, as may be deemed by him/her to be appropriate.
Section 17. Compliance with Parity Conditions. The Commission hereby finds and
determines as required by Section 5 of the Master Resolution, as follows:
First: The Port is not and has not been in default of its covenant under Section 7 of the
Master Resolution for the immediately preceding fiscal year (2010); and
Second: The Commission has been assured that prior to the issuance and delivery of the
Series 2011 Bonds, the Port will be able to execute a certificate (prepared as prescribed by the
Master Resolution) demonstrating fulfillment of the Coverage Requirement, commencing on the
first full fiscal year following the earlier of (1) the Date of Commercial Operation of the
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Facilities to be financed with the proceeds of the Series 2011 Bonds as reasonably estimated by
the Port or (2) the date on which any portion of interest on the Series 2011 Bonds will not be
paid from the proceeds thereof and for the following two fiscal years.
The limitations contained in the conditions provided in Section 5 of the Master
Resolution having been complied with, the payments required herein to be made out of the Net
Revenues to pay and secure the payment of the principal of, premium, if any, and interest on the
Series 2011 Bonds shall constitute a lien and charge upon such Net Revenues equal in rank to the
lien and charge thereon of the Outstanding Parity Bonds.
Section 18. Undertaking to Provide Ongoing Disclosure. The Designated P ort
Representative is authorized to, in his or her discretion, execute and deliver a Continuing
Disclosure Certificate providing for an undertaking by the Port to assist the Underwriters in
complying with Rule 15c2-12 promulgated by the Securities and Exchange Commission.
Section 19. Bond Insurance. The payments of the principal of and interest on one or
more series, or principal maturities within one or more series, of the Series 2011 Bonds may be
insured by the issuance of the Bond Insurance Policy. The Designated Port Representative may
solicit proposals from municipal bond insurance companies, and the Designated Port
Representative, in consultation with the Port's financial advisor, is hereby authorizedto select
the proposal that is deemed to be the most cost effective and further to execute the Bond
Insurance Commitment with the Bond Insurer, which may include such covenants and conditions
as shall be approved by the Designated Port Representative.
Section 20. Severability. If any one or more of the covenants or agreements provided
in this series resolution to be performed on the part of the Port shall be declared by any court of
competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or
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agreements, shall be null and void and shall be deemed separable from the remaining covenants
and agreements in this series resolution and shall in no way affect the validity of the other
provisions of this series resolution or of any Parity Bonds.
Section 21. Effective Date. This series resolution shall be effective immediately upon
its adoption.
ADOPTED by the Port Commission of the Port of Seattle at a regular meeting thereof,
held this ____ day of __________, 2011, and duly authenticated in open session by the
signatures of the Commissioners voting in favor thereof and the seal of the Commission duly
affixed.
PORT OF SEATTLE
Commissioners
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EXHIBIT A-1
SERIES A REFUNDING CANDIDATES (NON-AMT)
Port of Seattle
Subordinate Lien Revenue Refunding Bonds, 1998
Dated May 1, 1998
Maturity Dates
(September 1) Principal Amounts Interest Rates
2012 $ 1,630,000 5.000%
2013 1,710,000 5.375
2014 1,805,000 5.375
2017 5,980,000 5.000
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EXHIBIT A-2
SERIES B REFUNDING CANDIDATES (AMT)
Port of Seattle
Special Facility Revenue Bonds (Terminal 18 Project), Series 1999B (AMT)
Dated October 28, 1999
Maturity Dates
(September 1) Principal Amounts Interest Rates
2012 $ 1,145,000 5.65%
2013 1,295,000 5.75
2014 1,380,000 5.75
2015 1,780,000 6.00
2016 2,590,000 6.00
2020 18,225,000 6.00
2026 54,585,000 6.25
Port of Seattle
Special Facility Revenue Bonds (Terminal 18 Project), Series 1999C (AMT)
Dated October 28, 1999
Maturity Dates
(September 1) Principal Amounts Interest Rates
2012 $ 570,000 5.65%
2013 640,000 5.75
2014 685,000 5.75
2015 875,000 6.00
2016 1,260,000 6.00
2020 8,775,000 6.00
2029 30,190,000 6.00
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[TO BE APPROPIATELY MODIFIED AT PRICING AND/OR IN THE EVENT OF
ISSUANCE OF MULTIPLE SERIES AT DIFFERENT DATES OF ISSUE]
EXHIBIT B
E S C R O W D E P O S I T A G R E E M E N T
PORT OF SEATTLE
REVENUE REFUNDING BONDS, SERIES 2011A
AND
REVENUE REFUNDING BONDS, SERIES 2011B (AMT)
THIS ESCROW DEPOSIT AGREEMENT, dated as of ________, 2011 (herein,
together with any amendments or supplements hereto, called the "Agreement") is entered into by
and between the Port of Seattle (herein called the "Port") and _________________,as escrow
agent (the "Escrow Agent"). The notice addresses of the Port and the Escrow Agent are shown
on Exhibit A attached hereto and made a part hereof.
W I T N E S S E T H :
WHEREAS, the Port heretofore has issued certain revenue bonds presently remaining
outstanding as identified and described in Exhibit B (the "Refunded Bonds"); and
WHEREAS, pursuant to Resolution No. 3059, as amended, and as amended and restated
by Resolution No. 3577 (the "Master Resolution") and Resolution No. ____, adopted on
_________, 2011 (the "Series Resolution" and together with the Master Resolution, the "Bond
Resolution"), the Port has determined to issue its Revenue Refunding Bonds, Series 2011A (the
"Series 2011A Bonds) and Revenue Refunding Bonds, Series 2011B (AMT) (the "Series 2011B
Bonds", collectively, with the Series 2011A Bonds, the "Series 2011 Bonds") in part for the
purpose of providing funds to pay the costs of refunding the Refunded Bonds; and
WHEREAS, the proceeds of the Bonds are being used for the purpose of providing funds
to pay the costs of refunding the Refunded Bonds; and
WHEREAS, [Verification Agent], Certified Public Accountants, of _________, have
prepared a verification report which is dated __________, 2011 (the "Verification Report")
relating to the source and use of funds available to accomplish the refunding of the Refunded
Bonds, the investment of such funds and the adequacy of such funds and investments to provide
for the payment of the debt service due on the Refunded Bonds; and
WHEREAS, pursuant to the Bond Resolution, the Refunded Bonds have been designated
for redemption prior to their scheduled maturity dates and, after provision is made for such
redemption, the Refunded Bonds will come due in such years, bear interest at such rates, and be
payable at such times and in such amounts as are set forth in Exhibit C attached hereto and made
a part hereof; and
WHEREAS, when Escrowed Securities have been deposited with the Escrow Agent for
the payment of all principal and interest of the Refunded Bonds when due, then the Refunded
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Bonds shall no longer be regarded as outstanding except for the purpose of receiving payment
from the funds provided for such purpose; and
WHEREAS, the issuance, sale, and delivery of the Bonds have been duly authorized to
be issued, sold, and delivered for the purpose of obtaining the funds required to provide for the
payment of the principal of, interest on and redemption premium (if any) on the Refunded Bonds
when due as shown on Exhibit C attached hereto;
NOW, THEREFORE, in consideration of the mutual undertakings, promises and
agreements herein contained, the sufficiency of which hereby are acknowledged, and to secure
the full and timely payment of principal of and the interest on the Refunded Bonds, the Port and
the Escrow Agent mutually undertake, promise and agree for themselves and their respective
representatives and successors, as follows:
Article 1. Definitions
Section 1.1. Definitions.
Unless the context clearly indicates otherwise, the following terms shall have the
meanings assigned to them below when they are used in this Agreement:
Escrow Fund means the fund created by this Agreement to be established, held and
administered by the Escrow Agent pursuant to the provisions of this Agreement.
Escrowed Securities means the noncallable Government Obligations described in
Exhibit D attached to this Agreement, or cash or other noncallable obligations substituted
therefor pursuant to Section 4.2 of this Agreement.
Government Obligations means direct, noncallable (a) United States Treasury
Obligations, (b) United States Treasury Obligations - State and Local Government Series,
(c) non-prepayable obligations which are unconditionally guaranteed as to full and timely
payment of principal and interest by the United States of America or (d) REFCORP debt
obligations unconditionally guaranteed by the United States.
Paying Agent means the fiscal agency of the State of Washington, as the paying agent for
the Refunded Bonds.
Section 1.2. Other Definitions.
The terms "Agreement," "Port," "Escrow Agent," "Bond Resolution," "Refunded
Bonds," and "Bonds" when they are used in this Agreement, shall have the meanings assigned to
them in the preamble to this Agreement.
Section 1.3. Interpretations.
The titles and headings of the articles and sections of this Agreement have been inserted
for convenience and reference only and are not to be considered a part hereof and shall not in any
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way modify or restrict the terms hereof. This Agreement and all of the terms and provisions
hereof shall be liberally construed to effectuate the purposes set forth herein and to achieve the
intended purpose of providing for the refunding of the Refunded Bonds in accordance with
applicable law.
Article 2. Deposit of Funds and Escrowed Securities
Section 2.1. Deposits in the Escrow Fund.
Concurrently with the sale and delivery of the Bonds the Port shall deposit, or cause to be
deposited, with the Escrow Agent, for deposit in the Escrow Fund, the funds (from the proceeds
of the Bonds and a cash contribution by the Port) sufficient to purchase the Escrowed Securities,
and the Escrow Agent shall, upon the receipt thereof, acknowledge such receipt to the Port in
writing.
Article 3. Creation and Operation of Escrow Fund
Section 3.1. Escrow Fund.
The Escrow Agent has created on its books a special trust fund and irrevocable escrow to
be known as the Refunding Account (the "Escrow Fund"). The Escrow Agent hereby agrees that
upon receipt thereof it will deposit to the credit of the Escrow Fund the funds and the Escrowed
Securities described in Exhibit D attached hereto and pay Costs of Issuance as described in
Exhibit D. Such deposit, all proceeds therefrom, and all cash balances from time to time on
deposit therein (a) shall be the property of the Escrow Fund, (b) shall be applied only in strict
conformity with the terms and conditions of this Agreement, and (c) are hereby irrevocably
pledged to the payment of the principal of and interest on the Refunded Bonds, which payment
shall be made by timely transfers of such amounts at such times as are provided for in
Section 3.2 hereof. When the final transfers have been made for the payment of such principal
of and interest on the Refunded Bonds, any balance then remaining in the Escrow Fund shall be
transferred to the Port, and the Escrow Agent shall thereupon be discharged from any further
duties hereunder.
Section 3.2. Payment of Principal and Interest.
The Escrow Agent is hereby irrevocably instructed to transfer to the Paying Agent from
the cash balances from time to time on deposit in the Escrow Fund, the amounts required to pay
the principal of the Refunded Bonds at their respective redemption dates and interest thereon to
such redemption dates in the amounts and at the times shown in Exhibit C attached hereto.
Section 3.3. Sufficiency of Escrow Fund.
The Port represents that, based upon the information provided in the Verification Report,
the successive receipts of the principal of and interest on the Escrowed Securities will assure that
the cash balance on deposit from time to time in the Escrow Fund will be at all times sufficient to
provide moneys for transfer to the Paying Agent at the times and in the amounts required to pay
the interest on the Refunded Bonds as such interest comes due and the principal of the Refunded
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Bonds as the Refunded Bonds are paid on an optional redemption date prior to maturity, all as
more fully set forth in Exhibit E attached hereto. If, for any reason, at any time, the cash
balances on deposit or scheduled to be on deposit in the Escrow Fund shall be insufficient to
transfer the amounts required by the Paying Agent to make the payments set forth in Section 3.2.
hereof, the Port shall timely deposit in the Escrow Fund, from any funds that are lawfully
available therefor, additional funds in the amounts required to make such payments. Notice of
any such insufficiency shall be given promptly as hereinafter provided, but the Escrow Agent
shall not in any manner be responsible for any insufficiency of funds in the Escrow Fund or the
Port's failure to make additional deposits thereto.
Section 3.4. Trust Fund.
The Escrow Agent or its affiliate, shall hold at all times the Escrow Fund, the Escrowed
Securities and all other assets of the Escrow Fund, wholly segregated from all other funds and
securities on deposit with the Escrow Agent; it shall never allow the Escrowed Securities or any
other assets of the Escrow Fund to be commingled with any other funds or securities of the
Escrow Agent; and it shall hold and dispose of the assets of the Escrow Fund only as set forth
herein. The Escrowed Securities and other assets of the Escrow Fund shall always be maintained
by the Escrow Agent as trust funds for the benefit of the owners of the Refunded Bonds; and a
special account thereof shall at all times be maintained on the books of the Escrow Agent. The
owners of the Refunded Bonds shall be entitled to the same preferred claim and first lien upon
the Escrowed Securities, the proceeds thereof, and all other assets of the Escrow Fund to which
they are entitled as owners of the Refunded Bonds. The amounts received by the Escrow Agent
under this Agreement shall not be considered as a banking deposit by the Port, and the Escrow
Agent shall have no right to title with respect thereto except as a trustee and Escrow Agent under
the terms of this Agreement. The amounts received by the Escrow Agent under this Agreement
shall not be subject to warrants, drafts or checks drawn by the Port or, except to the extent
expressly herein provided, by the Paying Agent.
Article 4. Limitation on Investments
Section 4.1. Investments.
Except for the initial investment in the Escrowed Securities, and except as provided in
Section 4.2 hereof, the Escrow Agent shall not have any power or duty to invest or reinvest any
money held hereunder, or to make substitutions of the Escrowed Securities, or to sell, transfer, or
otherwise dispose of the Escrowed Securities.
Section 4.2. Substitution of Securities.
At the written request of the Port, and upon compliance with the conditions hereinafter
stated, the Escrow Agent shall utilize cash balances in the Escrow Fund, or sell, transfer,
otherwise dispose of or request the redemption of the Escrowed Securities and apply the
proceeds therefrom to purchase Refunded Bonds or Government Obligations which do not
permit the redemption thereof at the option of the obligor. Any such transaction may be effected
by the Escrow Agent only if (a) the Escrow Agent shall have received a written opinion from a
firm of certified public accountants that such transaction will not cause the amount of money and
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securities in the Escrow Fund to be reduced below an amount sufficient to provide for the full
and timely payment of principal of and interest on all of the remaining Refunded Bonds as they
become due, taking into account any optional redemption thereof exercised by the Port in
connection with such transaction; (b) the substituted securities have been received; and (c) the
Escrow Agent shall have received the unqualified written legal opinion of its bond counsel or tax
counsel to the effect that such transaction will not cause any of the Bonds or Refunded Bonds to
be an "arbitrage bond" within the meaning of Section 148 of the Internal Revenue Code of 1986,
as amended.
Article 5. Application of Cash Balances
Section 5.1. In General.
Except as provided in Section 2.1, 3.2 and 4.2 hereof, no withdrawals, transfers or
reinvestment shall be made of cash balances in the Escrow Fund. Cash balances shall be held by
the Escrow Agent as cash balances as shown on the books and records of the Escrow Agent and,
except as provided herein, shall not be reinvested by the Escrow Agent.
Article 6. Redemption of Refunded Bonds
Section 6.1. Call for Redemption.
The Port hereby irrevocably calls the Refunded Bonds for redemption on their earliest
redemption dates, as shown on Appendix A-1 and Appendix A-2 attached hereto.
Section 6.2. Notice of Redemption/Notice of Defeasance.
The Escrow Agent agrees to give a notice of defeasance and a notice of the redemption of
the Refunded Bonds pursuant to the terms of the Refunded Bonds and in substantially the forms
attached hereto as Appendices A-1 through B-2 attached hereto and as described on said
Appendices A-1 through B-2 to the Paying Agent for distribution as described therein. The
notice of defeasance shall be given immediately following the execution of this Agreement, and
the notice of redemption shall be given in accordance with the resolutions authorizing the
Refunded Bonds. The Escrow Agent hereby certifies that provision satisfactory and acceptable
to the Escrow Agent has been made for the giving of notice of redemption of the Refunded
Bonds.
Article 7. Records and Reports
Section 7.1. Records.
The Escrow Agent will keep books of record and account in which complete and accurate
entries shall be made of all transactions relating to the receipts, disbursements, allocations and
application of the money and Escrowed Securities deposited to the Escrow Fund and all proceeds
thereof, and such books shall be available for inspection during business hours and after
reasonable notice.
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Section 7.2. Reports.
While this Agreement remains in effect, the Escrow Agent quarterly shall prepare and
send to the Port a written report summarizing all transactions relating to the Escrow Fund during
the preceding financial quarter, including, without limitation, credits to the Escrow Fund as a
result of interest payments on or maturities of the Escrowed Securities and transfers from the
Escrow Fund for payments on the Refunded Bonds or otherwise, together with a detailed
statement of all Escrowed Securities and the cash balance on deposit in the Escrow Fund as of
the end of such period.
Article 8. Concerning the Paying Agent and Escrow Agent
Section 8.1. Representations.
The Escrow Agent hereby represents that it has all necessary power and authority to enter
into this Agreement and undertake the obligations and responsibilities imposed upon it herein,
and that it will carry out all of its obligations hereunder.
Section 8.2. Limitation on Liability.
The liability of the Escrow Agent to transfer funds for the payment of the principal of and
interest on the Refunded Bonds shall be limited to the proceeds of the Escrowed Securities and
the cash balances from time to time on deposit in the Escrow Fund. Notwithstanding any
provision contained herein to the contrary, the Escrow Agent shall have no liability whatsoever
for the insufficiency of funds from time to time in the Escrow Fund or any failure of the obligors
of the Escrowed Securities to make timely payment thereon, except for the obligation to notify
the Port promptly of any such occurrence.
The recitals herein and in the proceedings authorizing the Bonds shall be taken as the
statements of the Port and shall not be considered as made by, or imposing any obligation or
liability upon, the Escrow Agent.
The Escrow Agent is not a party to the proceedings authorizing the Bonds or the
Refunded Bonds and is not responsible for nor bound by any of the provisions thereof (except to
the extent that the Escrow Agent may be a place of payment and paying agent and/or a paying
agent/registrar therefor). In its capacity as Escrow Agent, it is agreed that the Escrow Agent
need look only to the terms and provisions of this Agreement.
The Escrow Agent makes no representations as to the value, conditions or sufficiency of
the Escrow Fund, or any part thereof, or as to the title of the Port thereto, or as to the security
afforded thereby or hereby, and the Escrow Agent shall not incur any liability or responsibility in
respect to any of such matters.
It is the intention of the parties hereto that the Escrow Agent shall never be required to
use or advance its own funds or otherwise incur personal financial liability in the performance of
any of its duties or the exercise of any of its rights and powers hereunder.
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The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in
good faith in any exercise of reasonable care and believed by it to be within the discretion or
power conferred upon it by this Agreement, nor shall the Escrow Agent be responsible for the
consequences of any error of judgment; and the Escrow Agent shall not be answerable except for
its own neglect or willful misconduct, nor for any loss unless the same shall have been through
its negligence or bad faith.
Unless it is specifically otherwise provided herein, the Escrow Agent has no duty to
determine or inquire into the happening or occurrence of any event or contingency or the
performance or failure of performance of the Port with respect to arrangements or contracts with
others, with the Escrow Agent's sole duty hereunder being to safeguard the Escrow Fund, to
dispose of and deliver the same in accordance with this Agreement. If, however, the Escrow
Agent is called upon by the terms of this Agreement to determine the occurrence of any event or
contingency, the Escrow Agent shall be obligated, in making such determination, only to
exercise reasonable care and diligence, and in event of error in making such determination the
Escrow Agent shall be liable only for its own willful misconduct or its negligence. In
determining the occurrence of any such event or contingency the Escrow Agent may request
from the Port or any other person such reasonable additional evidence as the Escrow Agent in its
discretion may deem necessary to determine any fact relating to the occurrence of such event or
contingency, and in this connection may make inquiries of, and consult with, among others, the
Port at any time.
Section 8.3. Compensation.
The Port shall pay to the Escrow Agent fees for performing the services hereunder and
for the expenses incurred or to be incurred by the Escrow Agent in the administration of this
Agreement pursuant to the terms of the Fee Schedule attached hereto as Appendix C. The
Escrow Agent hereby agrees that in no event shall it ever assert any claim or lien against the
Escrow Fund for any fees for its services, whether regular or extraordinary, as Escrow Agent, or
in any other capacity, or for reimbursement for any of its expenses as Escrow Agent or in any
other capacity.
Section 8.4. Successor Escrow Agents.
If at any time the Escrow Agent or its legal successor or successors should become
unable, through operation or law or otherwise, to act as escrow agent hereunder, or if its property
and affairs shall be taken under the control of any state or federal court or administrative body
because of insolvency or bankruptcy or for any other reason, a vacancy shall forthwith exist in
the office of Escrow Agent hereunder. In such event the Port, by appropriate action, promptly
shall appoint an Escrow Agent to fill such vacancy. If no successor Escrow Agent shall have
been appointed by the Port within 60 days, a successor may be appointed by the owners of a
majority in principal amount of the Refunded Bonds then outstanding by an instrument or
instruments in writing filed with the Port, signed by such owners or by their duly authorized
attorneys-in-fact. If, in a proper case, no appointment of a successor Escrow Agent shall be
made pursuant to the foregoing provisions of this section within three months after a vacancy
shall have occurred, the owner of any Refunded Bond may apply to any court of competent
jurisdiction to appoint a successor Escrow Agent. Such court may thereupon, after such notice,
if any, as it may deem proper, prescribe and appoint a successor Escrow Agent.
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Any successor Escrow Agent shall be a corporation organized and doing business under
the laws of the United States or the State of Washington, authorized under such laws to exercise
corporate trust powers, having its principal office and place of business in the State of
Washington, having a combined capital and surplus of at least $100,000,000 and subject to the
supervision or examination by federal or state authority.
Any successor Escrow Agent shall execute, acknowledge and deliver to the Port and the
Escrow Agent an instrument accepting such appointment hereunder, and the Escrow Agent shall
execute and deliver an instrument transferring to such successor Escrow Agent, subject to the
terms of this Agreement, all the rights, powers and trusts of the Escrow Agent hereunder. Upon
the request of any such successor Escrow Agent, the Port shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor Escrow Agent
all such rights, powers and duties.
The obligations assumed by the Escrow Agent pursuant to this Agreement may be
transferred by the Escrow Agent to a successor Escrow Agent if (a) the requirements of this
Section 8.4 are satisfied; (b) the successor Escrow Agent has assumed all the obligations of the
Escrow Agent under this Agreement; and (c) all of the Escrowed Securities and money held by
the Escrow Agent pursuant to this Agreement have been duly transferred to such successor
Escrow Agent.
Article 9. Miscellaneous
Section 9.1. Notice.
Any notice, authorization, request, or demand required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given when mailed by
registered or certified mail, postage prepaid addressed to the Port or the Escrow Agent at the
address shown on Exhibit A attached hereto. The United States Post Office registered or
certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date
and fact of delivery. Any party hereto may change the address to which notices are to be
delivered by giving to the other parties not less than ten days prior notice thereof.
Section 9.2. Termination of Responsibilities.
Upon the taking of all the actions as described herein by the Escrow Agent, the Escrow
Agent shall have no further obligations or responsibilities hereunder to the Port, the owners of
the Refunded Bonds or to any other person or persons in connection with this Agreement.
Section 9.3. Binding Agreement.
This Agreement shall be binding upon the Port and the Escrow Agent and their respective
successors and legal representatives, and shall inure solely to the benefit of the owners of the
Refunded Bonds, the Port, the Escrow Agent and their respective successors and legal
representatives.
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Section 9.4. Severability.
In case any one or more of the provisions contained in this Agreement shall for any
reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Agreement, but this Agreement shall
be construed as if such invalid or illegal or unenforceable provision had never been contained
herein.
Section 9.5. Washington Law Governs.
This Agreement shall be governed exclusively by the provisions hereof and by the
applicable laws of the State of Washington.
Section 9.6. Time of the Essence.
Time shall be of the essence in the performance of obligations from time to time imposed
upon the Escrow Agent by this Agreement.
Section 9.7. Notice to Moody's and S&P and Fitch.
In the event that this Agreement or any provision thereof is severed, amended or revoked,
the Port shall provide written notice of such severance, amendment or revocation to Moody's
Investors Service at 7 World Trade Center at 250 Greenwich Street, New York, New York,
10007, Attention: Public Finance Rating Desk/Refunded Bonds and to Standard & Poor's
Ratings Services, 55 Water Street, New York, New York 10041, Attention: Refunded Bonds
Municipal Bond Department.
Section 9.8. Amendments.
This Agreement shall not be amended except to cure any ambiguity or formal defect or
omission in this Agreement. No amendment shall be effective unless the same shall be in
writing and signed by the parties thereto. No such amendment shall adversely affect the rights of
the holders of the Refunded Bonds. No such amendment shall be made without first receiving
written confirmation from the rating agencies (if any) which have rated the Refunded Bonds that
such administrative changes will not result in a withdrawal or reduction of its rating then
assigned to the Refunded Bonds. If this Agreement is amended, prior written notice and copies
of the proposed changes shall be given to the rating agencies which have rated the Refunded
Bonds.
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EXECUTED as of the date first written above.
PORT OF SEATTLE
Designated Port Representative
[ESCROW AGENT]
as Authorized Signer
Exhibit A Addresses of the Port and the Escrow Agent
Exhibit B Description of the Refunded Bonds
Exhibit C Schedule of Debt Service on Refunded Bonds
Exhibit D Description of Beginning Cash Deposit (if any) and Escrowed Securities
Exhibit E Escrow Fund Cash Flow
Appendix A Forms of Notice of Redemption for the Refunded Bonds
Appendix B Forms of Notice of Defeasance for the Refunded Bonds
Appendix C Fee Schedule
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EXHIBIT A
ADDRESSES OF THE PORT AND ESCROW AGENT
Port: Port of Seattle
2711 Alaskan Way
Pier 69
Seattle, WA 98121
Attention: Chief Financial and Administrative Officer
Escrow Agent:
Attention:
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EXHIBIT B
DESCRIPTION OF THE REFUNDED BONDS
(the "Refunded Bonds")
Port of Seattle
Subordinate Lien Revenue Refunding Bonds, 1998
Dated May 1, 1998
Maturity Dates
(September 1) Principal Amounts Interest Rates
2012 $ 1,630,000 5.000%
2013 1,710,000 5.375
2014 1,805,000 5.375
2017 5,980,000 5.000
Port of Seattle
Special Facility Revenue Bonds (Terminal 18 Project), Series 1999B (AMT)
Dated October 28, 1999
Maturity Dates
(September 1) Principal Amounts Interest Rates
2012 $ 1,145,000 5.65%
2013 1,295,000 5.75
2014 1,380,000 5.75
2015 1,780,000 6.00
2016 2,590,000 6.00
2020 18,225,000 6.00
2026 54,585,000 6.25
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Port of Seattle
Special Facility Revenue Bonds (Terminal 18 Project), Series 1999C (AMT)
Dated October 28, 1999
Maturity Dates
(September 1) Principal Amounts Interest Rates
2012 $ 570,000 5.65%
2013 640,000 5.75
2014 685,000 5.75
2015 875,000 6.00
2016 1,260,000 6.00
2020 8,775,000 6.00
2029 30,190,000 6.00
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EXHIBIT C
SCHEDULE OF DEBT SERVICE ON THE REFUNDED BONDS
Principal/
Redemption
Date Interest Price Total
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EXHIBIT D
ESCROW DEPOSIT
I. Cash $_____
II. Other Obligations
Principal
Description Maturity Date Amount Interest Rate Total Cost
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EXHIBIT E
ESCROW FUND CASH FLOW
Escrow Escrow Excess Excess
Date Requirement Receipts Receipts Balance
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APPENDIX A
FORMS OF NOTICE OF REDEMPTION
Appendix A
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APPENDIX B
FORMS OF NOTICE OF DEFEASANCE
Appendix B
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APPENDIX C
Fee Schedule
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CERTIFICATE
I, the undersigned, Secretary of the Port Commission (the "Commission") of the Port of
Seattle (the "Port"), DO HEREBY CERTIFY:
1. That the attached resolution numbered ____ as amended (the "Resolution"), is a
true and correct copy of a resolution of the Port, as finally adopted at a meeting of the
Commission held on the ___ day of ___________, 2011, and duly recorded in my office.
2. That said meeting was duly convened and held in all respects in accordance with
law, and to the extent required by law, due and proper notice of such meeting was given; that a
quorum of the Commission was present throughout the meeting and a legally sufficient number
of members of the Commission voted in the proper manner for the adoption of said Resolution;
that all other requirements and proceedings incident to the proper adoption of said Resolution
have been duly fulfilled, carried out and otherwise observed, and that I am authorized to execute
this certificate.
IN WITNESS WHEREOF, I have hereunto set my hand this ___ day of
___________________, 2011.
Secretary
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