FY2020-07 Authorizing The Borough To Issue a Refunding Revenue Bond.0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
Introduced by:
Borough Manager
Requested by:
Finance Director
Drafted by:
Bond Counsel
Introduced on:
09/05/2019
Adopted on:
09/05/2019
KODIAK ISLAND BOROUGH
RESOLUTION NO. FY2020-07
A RESOLUTION OF THE KODIAK ISLAND BOROUGH ASSEMBLY
AUTHORIZING THE BOROUGH TO ISSUE A REFUNDING REVENUE
BOND TO REFUND CERTAIN PRINCIPAL INSTALLMENTS OF AN THE
OUTSTANDING LONG-TERM CARE CENTER REVENUE BOND, SERIES
2013 (PROVIDENCE KODIAK ISLAND MEDICAL CENTER), OF THE
BOROUGH AND TO PAY COSTS OF ISSUING THE BOND, FIXING
CERTAIN DETAILS OF SUCH BOND, AUTHORIZING ITS SALE, AND
PROVIDING FOR RELATED MATTERS
WHEREAS, pursuant to Resolution No. FY2013-13, adopted by the Assembly on February 7,
2013 (the "2013 Bond Resolution"), the Borough issued its Long -Term Care Center Revenue Bond,
Series 2013 (Providence Kodiak Island Medical Center) (the "2013 Bond"), maturing on June 1,
2033, with principal installments due on June 1 of each of the years 2015 through 2033, inclusive,
in the original principal amount of $17,110,000; and
WHEREAS, pursuant to Resolution No. FY2016-19, adopted by the Assembly on November 5,
2015, the Borough defeased a portion of the principal installments of the 2013 Bond due in each
of the years 2017 through 2033, inclusive, in the aggregate principal amount of $4,455,000, and
the 2013 Bond is currently outstanding in the aggregate principal amount of $9,960,000; and
WHEREAS, the principal installments of the 2013 Bond due in each of the years 2025 through
2030, inclusive, currently outstanding in the aggregate principal amount of $4,410,000, are subject
to prepayment in whole or in part at the option of the Borough on any date on or after June 1, 2018,
at a price of 100% of the principal amount thereof to be prepaid, plus accrued interest to the date
of prepayment; and
WHEREAS, under AS 29.47.300, if the Borough has outstanding revenue bonds and the
Assembly determines it would be financially advantageous to refund those bonds, the Borough
may provide by resolution for the issuance of revenue refunding bonds, and under AS 29.47.320,
no election is required to authorize the issuance and sale of refunding bonds; and
WHEREAS, under AS 29.47.340, refunding bonds may be exchanged for the bonds being
refunded; and
WHEREAS, the Borough sold the 2013 Bond to the Alaska Municipal Bond Bank (the "Bond
Bank"), as authorized by the 2013 Bond Resolution, on the terms and conditions set forth in the
2013 Bond Resolution and in the loan agreement between the Borough and the Bond Bank dated
as of June 1, 2013 (the "2013 Loan Agreement"); and
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 1 of 14
48 WHEREAS, the Bond Bank issued its General Obligation Bonds, 20138 Series Two (Qualified
49 501(c)(3)) (the "Bond Bank Bonds"), among other purposes, to provide funds to purchase the 2013
50 Bond, as provided in the 2013 Loan Agreement; and
51
52 WHEREAS, the Bond Bank has expressed its intent to issue refunding bonds (the "Bond Bank
53 Refunding Bonds") for the purpose of refunding a portion of the Bond Bank Bonds and achieving a
54 debt service savings; and
55
56 WHEREAS, Section 7 of the 2013 Loan Agreement provides that payments of principal of and
57 interest on the 2013 Bond may be adjusted to reduce debt service on the 2013 Bond if the Bond
58 Bank is able to achieve debt service savings by refunding the Bond Bank Bonds; and
59
60 WHEREAS, the Bond Bank has offered to enter into an Amendatory Loan Agreement (the
61 "Amendatory Loan Agreement") to effect a reduction in debt service on all or a portion of the
62 principal installments of the 2013 Bond due in each of the years 2025 through 2030, inclusive,
63 currently outstanding in the aggregate principal amount of $4,410,000 (the "Refundable Principal
64 Installments"); and
65
66 WHEREAS, the Assembly wishes to effect a reduction in debt service on all or a portion of the
67 Refundable Principal Installments by entering into the Amendatory Loan Agreement, issuing a
68 refunding bond (and a replacement 2013 Bond) in exchange for the 2013 Bond, and participating
69 in the refunding of a portion of the Bond Bank Bonds; and
70
71 WHEREAS, the Assembly finds that it is necessary and appropriate to delegate to each of the
72 Borough Manager and Borough Finance Director authority to determine the maturity amounts,
73 interest rates, and other details of the bond, and to determine other matters that are not provided
74 for in this Resolution;
75 O
76 NOW, THEREFORE, BE IT RESOLVED BY THE ASSEMBLY OF THE KODIAK ISLAND
77 BOROUGH THAT:
78
79 Section 1: Definitions. In addition to terms which are defined in the recitals above, the
80 following terms shall have the following meanings in this Resolution:
81
82 (a) "2013 Bond" means the Long -Term Care Center Revenue Bond, Series
83 2013 (Providence Kodiak Island Medical Center), issued by the Borough pursuant
84 to the 2013 Bond Resolution.
85
86 (b) "2013 Bond Resolution" means Resolution No. FY2013-13 of the Borough,
87 adopted by the Assembly on February 7, 2013.
88
89 (c) "2013 Loan Agreement" means the loan agreement between the Borough
90 and the Bond Bank dated as of June 1, 2013.
91
92 (d) "Amendatory Loan Agreement" means the amendatory loan agreement to
93 be entered into between the Borough and the Bond Bank to effect a reduction in
94 debt service on all or a portion of the Refundable Principal Installments.
95
96 (e) "Annual Debt Service Requirement" means, with respect to any particular
97 Fiscal Year and to any specified bonds, an amount equal to (i) interest accruing
98 during such Fiscal Year on such bonds, except to the extent such interest is to be
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 2 of 14
99
paid from deposits in the Debt Service Subaccount from bond proceeds; (ii) the
100
principal amount of such bonds due during such Fiscal Year for which no sinking
101
fund installments have been established; plus (iii) the unsatisfied balance of any
j 102
sinking fund installment for such bonds due during such Fiscal Year.
103
104
(f) "Arbitrage and Tax Certificate" means the certificate executed and
105
delivered by the Borough at the time of issuance and delivery of the Bond setting
106
forth the Borough's expectations as to the use of Bond proceeds.
107
108
(g) "Assembly" means the Assembly of the Kodiak Island Borough, as the
109
general legislative authority of the Kodiak Island Borough, as the same shall be
110
duly and regularly constituted from time to time.
111
112
(h) "Bond" means the "Long -Term Care Center Refunding Revenue Bond
113
(Providence Kodiak Island Medical Center)" of the Kodiak Island Borough, the
114
issuance and sale of which are authorized herein.
115
116
(i) "Bond Account" means the Long -Term Care Center Revenue Bond
117
Account created by Section 15 of the 2013 Bond Resolution.
118
119
(j) "Bond Bank" means the Alaska Municipal Bond Bank.
120
121
(k) "Bond Bank Bonds" means the General Obligation Bonds, 20138 Series
122
Two (Qualified 501(c)(3)), issued by the Bond Bank.
123
124
(1) "Bond Bank Refunding Bonds" means the series of general obligation
125
bonds issued by the Bond Bank, all or part of the proceeds of which are used to
(� 126
purchase the Bond.
U 127
128
(m) "Bond Register" means the registration books maintained by the Registrar,
129
which include the names and addresses of the Registered Owners of the Bond or
130
their nominees.
131
132
(n) "Borough" means the Kodiak Island Borough, a municipal corporation of
133
the State of Alaska, organized as a second class borough under Title 29 of the
134
Alaska Statutes.
135
136
(o) "Borough Manager" means the Manager or Administrative Official of the
137
Borough.
138
139
(p) "Code" means the Internal Revenue Code of 1986, as amended from time
140
to time, together with all regulations applicable thereto.
141
142
(q) "Debt Service Subaccount" means the Debt Service Subaccount created
143
in the Bond Account by Section 15 of the 2013 Bond Resolution.
144
145
(r) "Financing Documents" means all or any of the 2013 Loan Agreement, the
146
Amendatory Loan Agreement, Lease, the 2013 Bond, the Bond, the 2013 Bond
147
Resolution, and this Resolution.
148
UKodiak Island Borough, Alaska Resolution No. FY2020-07
Page 3 of 14
149
(s) "Fiscal Year" means the 12 -month period commencing on July 1 each year
150
through and including June 30 of the following calendar year.
151
152
(t) "Future Parity Bonds" means any long-term care center revenue bonds,
153
notes, or other obligations of the Borough, other than the 2013 Bond and the Bond,
154
issued under a resolution wherein the Borough pledges that the payments to be
155
made out of the Pledged Revenues into the Bond Account and Reserve
156
Subaccount therein to pay and secure the payment of the principal of and interest
157
on such revenue bonds, notes, or other obligations will be on a parity with the
158
payments required by this Resolution to be made out of such Pledged Revenues
159
into such Bond Account and Reserve Subaccount to pay and secure the payment
160
of the principal of and interest on the 2013 Bond and the Bond.
161
162
(u) "Government Obligations" means obligations that are either (i) direct
163
obligations of the United States of America or (ii) obligations of an agency or
164
instrumentality of the United States of America the timely payment of the principal
165
of and interest on which are unconditionally guaranteed by the United States of
166
America.
167
168
(v) "Lease" means that certain Long -Term Care Center Lease Agreement
169
authorized by the Assembly in fall 2012, between the Borough and Providence for
170
the real property located at 1838 Chichenof Street, Kodiak, Alaska.
171
172
(w) "Parity Bonds" means the 2013 Bond, the Bond, and any Future Parity
173
Bonds.
174
175
(x) "Pledged Revenues" means Lease revenues and interest received and
176
profits derived from the investment of moneys obtained from moneys held in any
177
fund solely to pay or secure the payment of principal and interest when due on the
178
2013 Bond and the Bond.
179
180
(y) "Providence" means Providence Health & Services — Washington d/b/a
181
Providence Health & Services in Alaska, a Washington nonprofit corporation.
182
183
(z) "Refundable Princioal Installments" means the principal installments of the
184
2013 Bond due in each of the years 2025 through 2030, inclusive, currently
185
outstanding in the aggregate principal amount of $4,410,000.
186
187
(as) "Registered Owner" means the person named as the registered owner of
188
the Bond in the Bond Register.
189
190
(bb) "Registrar" means the Borough Finance Director, or any successor that
191
the Borough may appoint by resolution.
192
193
(cc) "Reserve Subaccount" means the Reserve Subaccount created in the
194
Bond Account by Section 15 of the 2013 Bond Resolution.
195
196
(dd) "Reserve Subaccount Requirement" means an amount equal to the least
197
of (i) 10% of the stated principal amount of the Parity Bonds; (ii) 125% of the
198
average Annual Debt Service Requirement for all Parity Bonds; and (iii) the
199
maximum Annual Debt Service Requirement on all outstanding Parity Bonds.
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 4 of 14
ri
t
ri
200
201
(ee) "Resolution" means this Resolution No. FY2020-07 of the Borough.
202
203 Section 2:
Authorization of Bond and Purpose of Issuance. The Assembly hereby determines
204
it would be financially advantageous to refund all or a portion of the Refundable
205
Principal Installments by issuing the Bond (and a replacement 2013 Bond) on the
206
terms and conditions provided in this Resolution. For the purpose of providing the
207
funds required to refund all or a portion of the Refundable Principal Installments
208
and to pay all costs incidental thereto and to the issuance of the Bond, the Borough
209
hereby authorizes and determines to issue and sell the Bond in the principal
210
amount of not to exceed $4,410,000. The Bond shall be designated "Long -Term
211
Care Center Refunding Revenue Bond (Providence Kodiak Island Medical
212
Center)," with such additional series and year designation as the Borough Manager
213
or the Borough Finance Director may fix and determine. Issuance costs financed
214
by the Bond shall not exceed two percent (2%) of the proceeds of the Bond.
215
216
As a condition precedent to the issuance and delivery of the Bond, Providence
217
shall be required to execute and deliver a certificate to the Borough, pursuant to
218
which Providence shall provide certain assurances to the Borough relating, among
219
other things, to the tax-exempt status of the Bond.
220
221
The Borough Manager and/or the Borough Finance Director are hereby authorized
222
to fix and determine which of the Refundable Principal Installments are to be
223
refunded by issuing the Bond (and a replacement 2013 Bond) in exchange
224
therefor.
225
226 Section 3:
Security for the Bond. The Bond shall be secured by Lease payments to be made
227
by Providence under the Lease and the additional provisions of the Financing
228
Documents and shall be a special, limited obligation of the Borough payable solely
229
from and secured by payments to be received pursuant to the Lease. The
230
Premises subject to and as defined in the Lease shall not be pledged to or
231
subordinated to the payment of the Bond. The Bond does not and shall never
232
constitute a debt or indebtedness or loan of the general credit of the Borough within
233
the meaning of any provisions or limitations of the State of Alaska constitution or
234
any statute or ordinance, and shall not constitute or give rise to a general pecuniary
235
liability of the Borough or a charge against the general credit or taxing power of the
236
Borough, and the face of the Bond shall so state.
237
238 Section 4:
Date, Maturity, Interest Rates. and Other Details of the Bond. Each principal
239
installment of the Bond shall be in the denomination of $5,000 or any integral
240
multiple thereof. The Bond shall be numbered in the manner and with such
241
additional designation as the Registrar deems necessary for purposes of
242
identification, and may have endorsed thereon such legends or text as may be
243
necessary or appropriate to conform to the rules and regulations of any
244
governmental authority or any usage or requirement of law with respect thereto.
245
246
The Bond shall bear interest payable semi-annually on the dates and shall mature
247
on the date and each principal installment shall be payable annually in the amount
248
and on the dates, all as shall be set forth in the Amendatory Loan Agreement.
249
Interest will be computed on the basis of a 360 -day year consisting of twelve 30-
250
day months.
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 5 of 14
251
252
Subject to Section 2 and the remainder of this Section, the dated date, the principal
253
installment and interest payment dates, the record dates for interest payments, the
254
aggregate principal amount, the amount of each principal installment, and the
255
interest rate on each principal installment shall be determined at the time of
256
execution of the Amendatory Loan Agreement under Section 18, provided that
257
(i) no rate of interest on any principal installment shall exceed the rate of interest
258
on the corresponding maturity of the Bond Bank Refunding Bonds; and (ii) the net
259
present value of the savings to the Borough effected by issuing the Bond (and a
260
replacement 2013 Bond) and refunding the Refundable Principal Installments that
261
are refunded shall be at least A percent of the aggregate principal amount of the
262
Refundable Principal Installments that are refunded; and (iii) the Bond shall mature
263
on or before the date that is six months after the date on which the last Refundable
264
Principal Installment that is refunded is payable.
265
266 Section 5:
Optional Prepayment. The principal installments of the Bond shall be subject to
267
prepayment, at the Borough's option, on the dates and at the prices to be set forth
268
in the Amendatory Loan Agreement. If fewer than all of the principal installments
269
of the Bond are to be prepaid, the principal installments to be prepaid shall be
270
determined by the Borough. Notice of any such prepayment shall be sent by the
271
Borough not less than 50 days prior to the date fixed for prepayment by first class
272
mail to the Registered Owner at the Registered Owner's address as it then appears
273
on the Bond Register. Notice of prepayment having been duly given and the
274
prepayment having been duly effected, interest on the principal installments to be
275
prepaid shall cease to accrue on the date fixed for prepayment.
276
277 Section 6:
Form of Bond. Each Bond shall be in substantially the following form, subject to
278
the provisions of the Amendatory Loan Agreement and with such variations,
279
omissions, and insertions as may be required or permitted by this Resolution:
280
281
UNITED STATES OF AMERICA
282
283
KODIAK ISLAND BOROUGH, ALASKA
284
285
NO. $
286
287
LONG-TERM CARE CENTER REFUNDING REVENUE BOND
288
(PROVIDENCE KODIAK ISLAND MEDICAL CENTER)
289
290
REGISTERED OWNER: ALASKA MUNICIPAL BOND BANK AUTHORITY
291
292
PRINCIPAL AMOUNT:
293
294
The Kodiak Island Borough (the "Borough"), a municipal corporation of the
295
State of Alaska, hereby acknowledges itself to owe and for value received
296
promises to pay to the Registered Owner identified above, or its registered
297
assigns, but only from the sources stated herein, the principal amount identified
298
above in the following installments in each of the following years, and to pay, from
299
the sources stated herein, interest on such installments from the date hereof,
300
payable on _ 1, 20_, and semiannually thereafter on _ 1, and _ 1, of
301
each year, at the rates per annum as follows:
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 6 of 14
Page 7 of 14
302
303
Maturity Principal Interest
304
Date Amount Rate
305
306
307
308
For so long as the Alaska Municipal Bond Bank Authority (the "Bond
309
Bank") is the Registered Owner, payment of principal and interest shall be made
310
as provided in the Loan Agreement between the Bond Bank and the Borough, as
311
amended (the "Amended Loan Agreement"). When and if this Bond is not owned
312
by the Bond Bank, installments of principal of and interest on this Bond shall be
313
paid by check or draft mailed by first class mail to the Registered Owner as of the
314
close of business on the 15th day of the month before each installment payment
315
date; provided, that the final installment of principal of and interest on this Bond
316
shall be payable upon presentation and surrender of this Bond by the Registered
317
Owner at the office of the Registrar. Interest will be computed on the basis of a
318
360 -day year consisting of twelve 30 -day months. Both principal of and interest on
319
this Bond are payable in lawful money of the United States of America which, on
320
the respective dates of payment thereof, shall be legal tender for the payment of
321
public and private debts, solely out of the special fund of the Borough known as
322
the "Long -Term Care Center Revenue Bond Account" created by Section 15 of
323
Resolution No. FY2013-13.
324
325
This Bond is the Long -Term Care Center Refunding Revenue Bond
326
(Providence Kodiak Island Medical Center) issued by the Borough, and is
327
authorized for the purpose of refunding certain principal installments of an
328
outstanding revenue bond of the Borough under Resolution No. FY2020-07 of the
329
Borough entitled:
a
330
331
A RESOLUTION OF THE KODIAK ISLAND BOROUGH
332
ASSEMBLY AUTHORIZING THE BOROUGH TO ISSUE A
333
REFUNDING REVENUE BOND TO REFUND CERTAIN
334
PRINCIPAL INSTALLMENTS OF AN THE OUTSTANDING
335
LONG-TERM CARE CENTER REVENUE BOND, SERIES 2013
336
(PROVIDENCE KODIAK ISLAND MEDICAL CENTER), OF THE
337
BOROUGH AND TO PAY COSTS OF ISSUING THE BOND,
338
FIXING CERTAIN DETAILS OF SUCH BOND, AUTHORIZING ITS
339
SALE, AND PROVIDING FOR RELATED MATTERS
340
341
(the "Resolution").
342
343
Installments of principal of this Bond maturing on and after 1, 20_'
344
shall be subject to prepayment on and after 1, 20_, at the option of the
345
Borough (subject to any applicable provisions of the Amended Loan Agreement),
346
in such principal amounts and from such maturities as the Borough may determine,
347
and by lot within a maturity, at a redemption price equal to the principal amount to
348
be prepaid, plus accrued interest to the date of prepayment.
349
350
This Bond is transferable as provided in the Resolution, (i) only upon the
351
Bond Register of the Borough, and (ii) upon surrender of this Bond together with a
352
written instrument of transfer duly executed by the Registered Owner or the duly
CKodiak
Island Borough, Alaska Resolution No. FY2020-07
Page 7 of 14
353
authorized attorney of the Registered Owner, and thereupon a new fully registered
354
Bond in the same aggregate principal amount and maturity shall be issued to the
355
transferee in exchange therefor as provided in the Resolution and upon the
356
payment of charges, if any, as therein prescribed. The Borough may treat and
357
consider the person in whose name this Bond is registered as the absolute owner
358
hereof for the purpose of receiving payment of, or on account of, the principal or
359
redemption price, if any, hereof and interest due hereon and for all other purposes
360
whatsoever.
361
362
This Bond is a special, limited obligation of the Borough giving rise to no
363
charge against the Borough's general credit, and is payable solely from, and
364
constitute a claim of the owner hereof against, only the revenues, funds, and
365
assets of the Borough pledged under the Resolution. This Bond shall never
366
constitute a debt or indebtedness of the State of Alaska within the meaning of any
367
provision or limitation of the Constitution or statutes of the State of Alaska or the
368
Borough, or of any political subdivision thereof, and shall never constitute nor give
369
rise to a general pecuniary liability of the State or the Borough or a charge against
370
their general credit or taxing powers.
371
372
No officer, agent, or employee of the Borough, and no officer, official,
373
agent, or employee of the State of Alaska, nor any person executing this Bond,
374
shall in any event be subject to any personal liability or accountability by reason of
375
the issuance of this Bond.
376
377
This Bond is a "qualified 501(c)(3) bond" as such term is defined in the
378
Internal Revenue Code of 1986, as amended.
379
380
IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts or
381
things required by the constitution or statutes of the State of Alaska to exist, to
382
have happened or to have been performed precedent to or in the issuance of this
383
Bond exist, have happened and have been performed, and that this Bond, together
384
with all other indebtedness of the Borough, is within every debt and other limit
385
prescribed by such constitution or statutes.
386
387
IN WITNESS WHEREOF, THE KODIAK ISLAND BOROUGH, ALASKA,
388
has caused this Bond to be signed in its name and on its behalf by the manual or
389
facsimile signature of its Mayor and its corporate seal (or a facsimile thereof) to be
390
impressed or otherwise reproduced hereon and attested by the manual orfacsimile
391
signature of its Clerk, all as of the _ day of
392
393
KODIAK ISLAND BOROUGH
394
395
/specimen/
396
Borough Mayor
397
398
ATTEST:
399
400
/specimen/
401
Borough Clerk
402
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 8 of 14
403
Section 7:
Execution. The Bond shall be executed in the name of the Borough by the manual
404
or facsimile signature of the Mayor, and its corporate seal (or a facsimile thereof)
405
shall be impressed or otherwise reproduced thereon and attested by the manual
406
or facsimile signature of the Borough Clerk. The execution of a Bond on behalf of
407
the Borough by persons who at the time of the execution are duly authorized to
408
hold the proper offices shall be valid and sufficient for all purposes, although any
409
such person shall have ceased to hold office at the time of delivery of the Bond or
410
shall not have held office on the date of the Bond.
411
412
Section 8:
Payment of Principal Installments and Interest. The Bond shall be payable in
413
lawful money of the United States of America which at the time of payment is legal
414
tender for the payment of public and private debts. For so long as the Bond Bank
415
is the Registered Owner of the Bond, payment of principal installments of and
416
interest on the Bond shall be made as provided in the Loan Agreement, as
417
amended by the Amendatory Loan Agreement. When and if the Bond Bank is not
418
the Registered Owner of the Bond, installments of principal of and interest on the
419
Bond shall be paid by check mailed by first class mail to the Registered Owner as
420
of the record date for the installment payment at the address appearing on the
421
Bond Register; provided, that the final installment of principal and interest on the
422
Bond shall be payable upon presentation and surrender of the Bond by the
423
Registered Owner at the office of the Registrar.
424
425
Section 9:
Registration. The Bond shall be issued only in registered form as to both principal
426
and interest. The Borough designates the Borough Finance Director as Registrar
427
for the Bond. The Registrar shall keep, or cause to be kept, the Bond Register at
428
the principal office of the Borough. The Borough covenants that, until the Bond has
429
been surrendered and canceled, it will maintain a system for recording the
430
ownership of the Bond that complies with the provisions of Section 149 of the
j 431
Code. The Borough and the Registrar may treat the person in whose name the
U 432
Bond shall be registered as the absolute owner of such Bond for all purposes,
433
whether or not the Bond shall be overdue, and all payments of principal of and
434
interest on the Bond made to the Registered Owner thereof or upon its order shall
435
be valid and effectual to satisfy and discharge the liability upon such Bond to the
436
extent of the sum or sums so paid, and neither the Borough nor the Registrar shall
437
be affected by any notice to the contrary.
438
439
Section 10:
Transfer and Exchange. The Bond shall be transferred only upon the Bond
440
Register. Upon surrender for transfer or exchange of the Bond at the office of the
441
Registrar, together with a written instrument of transfer or authorization for
442
exchange in form and with guaranty of signature satisfactory to the Registrar, duly
443
executed by the Registered Owner or the duly authorized attorney of the
444
Registered Owner, the Borough shall execute and deliver a Bond in equal
445
aggregate principal amount, subject to such reasonable regulations as the
446
Borough may prescribe and upon payment sufficient to reimburse it for any tax,
447
fee or other governmental charge required to be paid in connection with such
448
transfer or exchange. If the Bond is surrendered for transfer or exchange it shall
449
be canceled by the Registrar.
450
451
Section 11:
Bond Mutilated. Destroyed. Stolen. or Lost. Upon surrender to the Registrar of a
452
mutilated Bond, the Borough shall execute and deliver a new Bond of like maturity
453
and principal amount. Upon filing with the Registrar of evidence satisfactory to the
Kodiak Island Borough, Alaska
Resolution No. FY2020-07
Page 9 of 14
454
Borough that a Bond has been destroyed, stolen, or lost and of the ownership
455
thereof, and upon furnishing the Borough with indemnity satisfactory to it, the
456
Borough shall execute and deliver a new Bond of like maturity and principal
457
amount. The person requesting the execution and delivery of a new Bond under
458
this Section shall comply with such other reasonable regulations as the Borough
459
may prescribe and shall pay such expenses as the Borough may incur in
460
connection therewith.
461
462 Section 12:
Long -Term Care Center Bond Account and Accounts Therein. There has been
463
heretofore created by Section 15 of the 2013 Bond Resolution a special fund of
464
the Borough known as the "Long -Term Care Center Revenue Bond Account" (the
465
"Bond Account"), which fund is a trust fund to be drawn upon for the sole purpose
466
of paying the principal of and interest and premium, if any, on all Parity Bonds. The
467
Bond Account consists of two subaccounts, the Debt Service Subaccount and the
468
Reserve Subaccount. Amounts pledged to be paid into the Bond Account are
469
hereby declared to be a lien and charge upon Pledged Revenues superior to all
470
other charges of any kind or nature and equal in rank to the charge thereon to pay
471
and secure the payment of the principal of and interest on all Parity Bonds.
472
473
The Borough hereby irrevocably obligates and binds itself to set aside and pay into
474
the Debt Service Subaccount out of Pledged Revenues on or before the 20th day
475
of each month the following:
476
477
A. Such amounts, in approximately equal monthly installments, as will be
478
sufficient to accumulate the amount required to pay the interest scheduled to
479
become due on Parity Bonds on the next interest payment date; and
480
481
B. Such amounts, in approximately equal monthly installments, as will be
482
sufficient to accumulate (i) the principal amount of Parity Bonds due for which no
483
sinking fund installments have been established; plus (ii) the unsatisfied balance
484
of any sinking fund installment for Parity Bonds, in each case during the next 12
485
months.
486
487
Moneys in the Debt Service Subaccount may be held in cash or invested in
488
accordance with the Arbitrage and Tax Certificate. Such investments shall mature
489
prior to the time such money is required for the payment of the principal of or
490
interest on the Parity Bonds. All interest earned on and profits derived from such
491
investments shall remain in and become part of the Debt Service Subaccount.
492
493 Section 13:
Reserve Subaccount. The Borough hereby covenants and agrees that it will, at
494
the time of issuance of the Bond, cause amounts to be paid into the Reserve
495
Subaccount such that the total amount in the Reserve Subaccount will be equal
496
he Reserve Subaccount Requirement.
497
498
The Borough further covenants and agrees that it will set aside and pay into the
499
Reserve Subaccount amounts from Pledged Revenues, commencing with the first
500
month following the closing and delivery of the Bond, so that the amount an deposit
501
in the Reserve Subaccount will at all times be at least equal to the Reserve
502
Subaccount Requirement.
503
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 10 of 14
504
The Borough further covenants and agrees that in the event it issues any Future
505
Panty Bonds hereafter it will provide in each resolution authorizing the same that
506
at the time of issuance of such Future Parity Bonds payments will be made into
507
the Reserve Subaccount such that the total amount of such payments together
508
with the money already in the Reserve Subaccount will be equal to the Reserve
509
Subaccount Requirement.
510
511
The Borough further covenants and agrees that it will at all times maintain therein
512
an amount at least equal to the Reserve Subaccount Requirement until there is a
513
sufficient amount in the Bond Account and Reserve Subaccount to pay the
514
principal of, premium, if any, and interest on all outstanding Parity Bonds, at which
515
time the money in the Reserve Subaccount may be used to pay such principal,
516
premium, if any, and interest; provided, however, that moneys in the Reserve
517
Subaccount may be withdrawn or set aside in a special account in the Bond
518
Account to pay (with or without other available funds) the principal, premium, if
519
any, and interest on all of the outstanding Parity Bonds of any single issue or series
520
of Parity Bonds, so long as the moneys remaining on deposit in the Reserve
521
Subaccount are at least equal to the Reserve Subaccount Requirement on all of
522
the remaining outstanding Parity Bonds. The Borough may, from time to time,
523
transfer from the Reserve Subaccount to the Debt Service Subaccount amounts
524
in excess of the Reserve Subaccount Requirement.
525
526
In the event there shall be a deficiency in the Debt Service Subaccount for meeting
527
maturing installments of either principal of or interest on the Parity Bonds, such
528
deficiency shall be made up from the Reserve Subaccount by the withdrawal of
529
cash therefrom. Any deficiency created in the Reserve Subaccount by reason of
530
any such withdrawal shall then be made up from Pledged Revenues first available
531
therefor after making necessary provision for the required payments into the Debt
a
532
Service Subaccount. Investments in the Reserve Subaccount shall be valued at
533
amortized cost except that in the event of a deficiency in the Reserve Subaccount
534
caused by the withdrawal or transfer of moneys therefrom the amount of such
535
deficiency shall be determined by valuing all investments in the Reserve
536
Subaccount at the then market value.
537
538
All money in the Reserve Subaccount may be kept in cash or invested in
539
Government Obligations. Such investments shall mature not later than the last
540
maturity of the Parity Bonds outstanding at the time of their purchase. Interest on
541
any such investments and/or any profits realized from the sale thereof shall be
542
deposited in and become part of the Debt Service Subaccount.
543
544
Section 14: Subordinate Lien Bonds. Nothing contained herein shall prevent the Borough from
545
issuing revenue bonds or notes which are a charge upon Pledged Revenues
546
subordinate or inferior to the payments required herein to be made therefrom into
547
the Debt Service Subaccount and Reserve Subaccount, or from issuing long-term
548
care center revenue bonds to refund maturing bonds for the payment of which
549
moneys are not otherwise available.
550
551
Section 15: Covenants Regarding Arbitrage and Private Activity Bonds. The Borough hereby
552
covenants that it will not make any use of the proceeds of sale of the Bond or any
553
other funds of the Borough which may be deemed to be proceeds of the Bond
554
pursuant to Section 148 of the Code which will cause the Bond to be an "arbitrage
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 11 of 14
555 bond" within the meaning of said section and the regulations applicable
556 thereunder. The Borough will comply with the requirements of Section 148 of the
557 Code (or any successor provision thereof applicable to the Bond) and the
558 applicable regulations thereunder throughout the term of the Bond.
559
560 The Borough further covenants that it will not take any action or permit any action
561 to be taken that would cause the Bond to constitute a "private activity bond" that is
562 not a "qualified bond" under Section 141 of the Code. The Borough will take any
563 action determined by the Borough, after consultation with its bond counsel, to be
564 legal and practicable and required to be taken by the Borough under future federal
565 laws or regulations in order to maintain the exemption of the interest on the Bond
566 from federal income taxation as a "qualified bond" under Section 141 of the Code.
567
568 Section 16: Amendatory and Suoolemental Resolutions.
569
570 (a) The Assembly from time to time and at any time may adopt a resolution or
571 resolutions supplemental hereto, which resolution or resolutions thereafter shall
572 become a part of this Resolution, for any one or more of the following purposes:
573
574 (1) To add to the covenants and agreements of the Borough in this
575 Resolution, other covenants and agreements thereafter to be observed or
576 to surrender any right or power herein reserved to or conferred upon the
577 Borough.
578
579 (2) To make such provisions for the purpose of curing any ambiguities
580 or of curing, correcting or supplementing any defective provision contained
581 in this Resolution or in regard to matters or questions arising under this
582 Resolution as the Assembly may deem necessary or desirable and not
583 inconsistent with this Resolution and which shall not adversely affect the
584 interests of the Registered Owner of the Bond.
585
586 Any such supplemental resolution may be adopted without the consent of the
587 Registered Owner of the Bond at any time outstanding, notwithstanding any of the
588 provisions of subsection (b) of this Section.
589
590 (b) With the consent of the Registered Owner, the Assembly may adopt a
591 resolution or resolutions supplemental hereto for the purpose of adding any
592 provisions to or changing in any manner or eliminating any of the provisions of this
593 Resolution or of any supplemental resolution.
594
595 It shall not be necessary for the consent of the Registered Owner of the Bond
596 under this subsection to approve the particular form of any proposed supplemental
597 resolution, but it shall be sufficient if such consent approves the substance thereof.
598
599 (c) Upon the adoption of any supplemental resolution under this Section, this
600 Resolution shall be deemed to be modified and amended in accordance therewith,
601 and the respective rights, duties, and obligations under this Resolution of the
602 Borough and the Registered Owner shall thereafter be subject in all respects to
603 such modification and amendment, and all the terms and conditions of the
604 supplemental resolution shall be deemed to be part of the terms and conditions of
605 this Resolution for any and all purposes.
II( 1
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 12 of 14
607
(d) Bonds executed and delivered after the adoption of any supplemental
608
resolution under this Section may bear a notation as to any matter provided for in
609
such supplemental resolution, and if such supplemental resolution shall so provide,
610
a new Bond modified so as to conform, in the opinion of the Borough, to any
611
modification of this Resolution contained in any such supplemental resolution may
612
be prepared by the Borough and delivered without cost to the Registered Owner
613
of the Bond, upon surrender for cancellation of such Bond in an equal aggregate
614
principal amount.
615
616
Section 17:
Defeasance. In the event money and/or non -callable Government Obligations
617
maturing at such times and bearing interest to be earned thereon in amounts
618
sufficient to redeem and retire the Bond in accordance with its terms are set aside
619
in a special trust account to effect such redemption or retirement and such moneys
620
and the principal of and interest on such Government Obligations are irrevocably
621
set aside and pledged for such purpose, then no further payments need be made
622
to pay or secure the payment of the principal of and interest on the Bond and the
623
Bond shall be deemed not to be outstanding.
624
625
Section 18:
Exchange of the Bond: Amendatory Loan Agreement: Continuing Disclosure
626
Certificate. The exchange of the Bond for all the Refundable Principal Installments
627
that are refunded (and the issuance of a replacement 2013 Bond), as provided in
628
the Amendatory Loan Agreement and this Resolution, is hereby authorized and
629
approved. The Amendatory Loan Agreement and the Continuing Disclosure
630
Certificate in substantially the form filed with this Resolution are hereby approved.
631
The Mayor and the Borough Manager are each hereby authorized to execute and
632
deliver the Amendatory Loan Agreement and the Continuing Disclosure Certificate
633
in such forms, together with such changes not inconsistent herewith as may be
0
634
approved by the Mayor or the Borough Manager (such approval to be conclusively
635
evidenced by such official's execution and delivery of such document).
636
637
Section 19:
Authority of Officers. The Mayor, the Borough Manager, the Borough Finance
638
Director, the Borough Clerk, the Borough Attorney, and bond counsel to the
639
Borough each is authorized and directed to do and perform all things and
640
determine all matters not determined by this Resolution, to the end that the
641
Borough may carry out its obligations under the Bond and this Resolution.
642
643
Section 20:
Ongoing Disclosure. The Borough acknowledges that under Rule 15c2-12 of the
644
Securities and Exchange Commission (the "Rule") the Borough may now or in the
645
future be an "obligated person" In accordance with the Rule, and as the Bond
646
Bank may require, the Borough shall undertake to provide certain annual financial
647
information and operating data as shall be set forth in the Amendatory Loan
648
Agreement.
649
650
Section 21:
Miscellaneous. No recourse shall be had for the payment of the principal of or the
651
interest on the Bond or for any claim based thereon or on this Resolution against
652
any member of the Assembly or officer of the Borough or any person executing the
653
Bond. The Bond is not and shall not be in any way a debt or liability of the State of
654
Alaska or of any political subdivision thereof, except the Borough, and does not
655
and shall not create or constitute an indebtedness or obligation, either legal, moral,
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 13 of 14
656 or otherwise, of such state or of any political subdivision thereof, except the
657 Borough.
658
659 Section 22: Severability. If any one or more of the provisions of this Resolution shall be
660 declared by any court of competent jurisdiction to be contrary to law, then such
661 provision shall be null and void and shall be deemed separable from the remaining
662 provisions of this Resolution and shall in no way affect the validity of the other
663 provisions of this Resolution or of the Bond.
664
665 Section 23: Effective Date. This Resolution shall become effective upon passage and
666 approval.
667
668 ADOPTED BY THE ASSEMBLY OF THE KODIAK ISLAND BOROUGH
669 THIS FIFTH DAY OF SEPTEMBER, 2019
670
671 KODIAK ISLAND BOROUGH
672
673
674
675
676 Daniel A. Rohrer, Mayor
677
678 ATTEST:
679 —
680
681
682 ZIA"
683 Tarh Weliris!Zy, Borough Clerk
Kodiak Island Borough, Alaska Resolution No. FY2020-07
Page 14 of 14
CERTIFICATE OF CLERK
I, TARA WELINSKY, Clerk of the Kodiak Island Borough (the "Borough"), HEREBY CERTIFY
that the document attached hereto is an accurate and complete copy of Resolution No. FY2020-07 of
the Borough adopted by the Borough Assembly at a meeting duly called and held on the fifth day of
September, 2019, and that Resolution No. FY2020-07 has not been modified, amended, repealed, or
rescinded, but is in full force and effect on the date hereof.
IN WITNESS WHEREOF, I have executed this certificate this fifth day of September, 2019.
(�
TA WELINSKY
Borough Clerk
Kodiak Island Borough
C. USERSGREENt APPDATAROAMING',NRPORTBLIMANDOCS' GREEM53495655 I.DOCX