99-057 - 07-06 - Awarding Sale Payment of $5,015,000 Gen Obligation Improvement Bonds, Series 1999BResolution 99-57
Councilmember
introduced the following resolution and moved
its adoption, which motion was seconded by Councilmember
RESOLUTION AUTHORIZING ISSUANCE, AWARDING SALE,
PRESCRIBING THE FORM AND DETAILS AND PROVIDING FOR THE
PAYMENT OF $5,015,000 GENERAL OBLIGATION IMPROVEMENT
BONDS, SERIES 1999B
BE IT RESOLVED by the City Council of the City of Golden Valley, Minnesota (the
Issuer), as follows:
SECTION 1. AUTHORIZATION AND SALE.
1.1. Authorization. This Council, by resolution duly adopted on June 1, 1999, authorized
the issuance and public sale of $5,015,000 General Obligation Improvement Bonds, Series
1999B (the Bonds) of the Issuer to finance the construction of street improvement projects (the
Projects) pursuant to the Issuer's 1999 Pavement Management Program.
1.2. Sale. Pursuant to the Terms of Proposal and the Official Statement prepared on
behalf of the Issuer by Springsted Incorporated, sealed proposals for the purchase of the Bonds
were received at or before the time specified for receipt of proposals. The proposals have been
opened, publicly read and considered and the purchase price, interest rates and net interest cost
under the terms of each proposal have been determined. The most favorable proposal received is
that of
to
and associates (the Purchaser), to
purchase the Bonds at a price of $ plus accrued interest on all Bonds
to the day of delivery and payment, on the further terms and conditions hereinafter set forth.
1.3. Award. The sale of the Bonds is hereby awarded to the Purchaser and the Mayor
and City Manager are hereby authorized and directed to execute a contract on behalf of the Issuer
for the sale of the Bonds in accordance with the terms of the proposal. The good faith deposit of
the Purchaser shall be retained and deposited by the Issuer until the Bonds have been delivered,
and shall be deducted from the purchase price paid at settlement.
SECTION 2. BOND TERMS: REGISTRATION: EXECUTION AND DELIVERY.
2.1. Issuance of Bonds. All acts, conditions and things which are required by the
Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be
performed precedent to and in the valid issuance of the Bonds having been done, now existing,
having happened and having been performed, it is now necessary for the City Council to
establish the form and terms of the Bonds, to provide security therefor and to issue the Bonds
forthwith.
2.2. Maturities; Interest Rates: Denominations and Pavment. The Bonds shall be
originally dated as of August 1, 1999, shall be in the denomination of $5,000 each, or any
integral multiple thereof, of single maturities, shall mature on February 1 in the years and
amounts stated below, and shall bear interest from date of issue until paid or duly called for
redemption at the annual rates set forth opposite such years and amounts, as follows:
Year
Amount Rate
Year
Amount Rate
2001
$495,000
2006
$390,000
2002
595,000
2007
400,000
2003
610,000
2008
405,000
2004
625,000
2009
420,000
2005
645,000
2010
430,000
The Bonds shall be issuable only in fully registered form. The interest on and upon surrender of
each Bond, the principal amount thereof, shall be payable by check or draft issued by the
Registrar described herein; provided that, so long as the Bonds are registered in the name of a
securities depository, or a nominee thereof, in accordance with Section 2.8 hereof, principal and
interest shall be payable in accordance with the operational arrangements of the securities
depository.
2.3. Dates and Interest Pavment Dates. Upon initial delivery of the Bonds pursuant to
Section 2.7 and upon any subsequent transfer or exchange pursuant to Section 2.6, the date of
authentication shall be noted on each Bond so delivered, exchanged or transferred. Interest on
the Bonds shall be payable on each February 1 and August 1, commencing August 1, 2000, to the
owners of record thereof as of the close of business on the fifteenth day of the immediately
preceding month, whether or not such day is a business day.
2.4. Redemption. Bonds maturing in 2007 and later years shall be subject to redemption
and prepayment at the option of the Issuer, in whole or in part, in such order of maturity dates as
the Issuer may select and within a maturity by lot as selected by the Registrar (or, if applicable,
by the bond depository in accordance with its customary procedures) in multiples of 55,000, on
February 1, 2006, and on any date thereafter, at a price equal to the principal amount thereof and
accrued interest to the date of redemption. The Clerk shall cause notice of the call for
redemption thereof to be published as required by law, and at least thirty days prior to the
designated redemption date, shall cause notice of call for redemption to be mailed, by first class
mail, to the registered holders of any Bonds to be redeemed at their addresses as they appear on
the bond register described in Section 2.6 hereof, but no defect in or failure to give such mailed
notice of redemption shall affect the validity of proceedings for the redemption of any Bond not
affected by such defect or failure. Official notice of redemption having been given as aforesaid,
the Bonds or portions of Bonds so to be redeemed shall, on the redemption date, become due and
payable at the redemption price therein specified and from and after such date (unless the Issuer
shall default in the payment of the redemption price) such Bonds or portions of Bonds shall cease
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to bear interest. Upon partial redemption of any Bond, a new Bond or Bonds will be delivered to
the owner without charge, representing the remaining principal amount outstanding.
2.5. Appointment of Initial Registrar. The Issuer hereby appoints U.S. Bank Trust
National Association, in St. Paul, Minnesota, as the initial bond registrar, transfer agent and
paying agent (the Registrar). The Mayor and Manager are authorized to execute and deliver, on
behalf of the Issuer, a contract with the Registrar. Upon merger or consolidation of the Registrar
with another corporation, if the resulting corporation is a bank or trust company authorized by
law to conduct such business, such corporation shall be authorized to act as successor Registrar.
The Issuer agrees to pay the reasonable and customary charges of the Registrar for the services
performed. The Issuer reserves the right to remove the Registrar upon thirty days' notice and
upon the appointment of a successor Registrar, in which event the predecessor Registrar shall
deliver all cash and Bonds in its possession to the successor Registrar and shall deliver the bond
register to the successor Registrar.
2.6. Registration. The effect of registration and the rights and duties of the Issuer and the
Registrar with respect thereto shall be as follows:
(a) Register. The Registrar shall keep at its principal corporate trust office a bond
register in which the Registrar shall provide for the registration of ownership of Bonds
and the registration of transfers and exchanges of Bonds entitled to be registered,
transferred or exchanged.
(b) Transfer of Bonds. Upon surrender for transfer of any Bond duly endorsed by
the registered owner thereof or accompanied by a written instrument of transfer, in form
satisfactory to the Registrar, duly executed by the registered owner thereof or by an
attorney duly authorized by the registered owner in writing, the Registrar shall
authenticate and deliver, in the name of the designated transferee or transferees, one or
more new Bonds of a like aggregate principal amount and maturity, as requested by the
transferor. The Registrar may, however, close the books for registration of any transfer
after the fifteenth day of the month preceding each interest payment date and until such
interest payment date.
(c) Exchange of Bonds. Whenever any Bonds are surrendered by the registered
owner for exchange the Registrar shall authenticate and deliver one or more new Bonds
of a like aggregate principal amount and maturity, as requested by the registered owner or
the owner's attorney in writing.
(d) Cancellation. All Bonds surrendered upon any transfer or exchange shall be
promptly canceled by the Registrar and thereafter disposed of as directed by the Issuer.
(e) Improper or Unauthorized Transfer. When any Bond is presented to the
Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that
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the endorsement on such Bond or separate instrument of transfer is valid and genuine and
that the requested transfer is legally authorized. The Registrar shall incur no liability for
the refusal, in good faith, to make transfers which it, in its judgment, deems improper or
unauthorized.
(f) Persons Deemed Owners. The Issuer and the Registrar may treat the person in
whose name any Bond is at any time registered in the bond register as the absolute owner
of the Bond, whether the Bond shall be overdue or not, for the purpose of receiving
payment of or on account of, the principal of and interest on the Bond and for all other
purposes; and all payments made to any registered owner or upon the owner's order shall
be valid and effectual to satisfy and discharge the liability upon Bond to the extent of the
sum or sums so paid.
(g) Taxes, Fees and Charges. For every transfer or exchange of Bonds (except for
an exchange upon a partial redemption of a Bond), the Registrar may impose a charge
upon the owner thereof sufficient to reimburse the Registrar for any tax, fee or other
governmental charge required to be paid with respect to such transfer or exchange.
(h) Mutilated, Lost, Stolen or Destroyed Bonds. In case any Bond shall become
mutilated or be destroyed, stolen or lost, the Registrar shall deliver a new Bond of like
amount, number, maturity date and tenor in exchange and substitution for and upon
cancellation of any such mutilated Bond or in lieu of and in substitution for any Bond
destroyed, stolen or lost, upon the payment of the reasonable expenses and charges of the
Registrar in connection therewith; and, in the case of a Bond destroyed, stolen or lost,
upon filing with the Registrar of evidence satisfactory to it that the Bond was destroyed,
stolen or lost, and of the ownership thereof, and upon furnishing to the Registrar of an
appropriate bond or indemnity in form, substance and amount satisfactory to it, in which
both the Issuer and the Registrar shall be named as obligees. All Bonds so surrendered to
the Registrar shall be canceled by it and evidence of such cancellation shall be given to
the Issuer. If the mutilated, destroyed, stolen or lost Bond has already matured or been
called for redemption in accordance with its terms it shall not be necessary to issue a new
Bond prior to payment.
(i) Authenticating Agent. The Registrar is hereby designated authenticating agent
for the Bonds, within the meaning of Minnesota Statutes, Section 475.55, Subdivision 1,
as amended.
2.7. Execution. Authentication and Deliverv. The Bonds shall be prepared under the
direction of the Clerk and shall be executed on behalf of the Issuer by the signatures of the Mayor
and the Manager, provided that the signatures may be printed, engraved or lithographed
facsimiles of the originals. In case any officer whose signature or a facsimile of whose signature
shall appear on the Bonds shall cease to be such officer before the delivery of any Bond, such
signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if he
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had remained in office until delivery. Notwithstanding such execution, no Bond shall be valid or
obligatory for any purpose or entitled to any security or benefit under this Resolution unless and
until a certificate of authentication on the Bond has been duly executed by the manual signature
of an authorized representative of the Registrar. Certificates of authentication on different Bonds
need not be signed by the same representative. The executed certificate of authentication on each
Bond shall be conclusive evidence that it has been authenticated and delivered under this
Resolution. When the Bonds have been prepared, executed and authenticated, the Finance
Director shall deliver them to the Purchaser upon payment of the purchase price in accordance
with the contract of sale heretofore executed, and the Purchaser shall not be obligated to see to
the application of the purchase price.
2.8. Securities Depository. (a) For purposes of this section the following terms shall
have the following meanings:
"Beneficial Owner" shall mean, whenever used with respect to a Bond, the person in
whose name such Bond is recorded as the beneficial owner of such Bond by a Participant on the
records of such Participant, or such person's subrogee.
"Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee
of DTC with respect to the Bonds.
"DTC" shall mean The Depository Trust Company of New York, New York.
"Participant" shall mean any broker-dealer, bank or other financial institution for which
DTC holds Bonds as securities depository.
"Representation Letter" shall mean the Representation Letter pursuant to which the Issuer
agrees to comply with DTC's Operational Arrangements.
(b) The Bonds shall be initially issued as separately authenticated fully registered bonds,
and one Bond shall be issued in the principal amount of each stated maturity of the Bonds. Upon
initial issuance, the ownership of such Bonds shall be registered in the bond register in the name
of Cede & Co., as nominee of DTC. The Registrar and the Issuer may treat DTC (or its nominee)
as the sole and exclusive owner of the Bonds registered in its name for the purposes of payment
of the principal of or interest on the Bonds, selecting the Bonds or portions thereof to be
redeemed, if any, giving any notice permitted or required to be given to registered owners of
Bonds under this resolution, registering the transfer of Bonds, and for all other purposes
whatsoever; and neither the Registrar nor the Issuer shall be affected by any notice to the
contrary. Neither the Registrar nor the Issuer shall have any responsibility or obligation to any
Participant, any person claiming a beneficial ownership interest in the Bonds under or through
DTC or any Participant, or any other person which is not shown on the bond register as being a
registered owner of any Bonds, with respect to the accuracy of any records maintained by DTC or
any Participant, with respect to the payment by DTC or any Participant of any amount with
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respect to the principal of or interest on the Bonds, with respect to any notice which is permitted
or required to be given to owners of Bonds under this resolution, with respect to the selection by
DTC or any Participant of any person to receive payment in the event of a partial redemption of
the Bonds, or with respect to any consent given or other action taken by DTC as registered owner
of the Bonds. So long as any Bond is registered in the name of Cede & Co., as nominee of DTC,
the Registrar shall pay all principal of and interest on such Bond, and shall give all notices with
respect to such Bond, only to Cede & Co. in accordance with DTC's Operational Arrangements,
and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's
obligations with respect to the principal of and interest on the Bonds to the extent of the sum or
sums so paid. No person other than DTC shall receive an authenticated Bond for each separate
stated maturity evidencing the obligation of the Issuer to make payments of principal and interest.
Upon delivery by DTC to the Registrar of written notice to the effect that DTC has determined to
substitute a new nominee in place of Cede & Co., the Bonds will be transferable to such new
nominee in accordance with paragraph (e) hereof.
(c) In the event the Issuer determines that it is in the best interest of the Beneficial
Owners that they be able to obtain Bonds in the form of bond certificates, the Issuer may notify
DTC and the Registrar, whereupon DTC shall notify the Participants of the availability through
DTC of Bonds in the form of certificates. In such event, the Bonds will be transferable in
accordance with paragraph (e) hereof. DTC may determine to discontinue providing its services
with respect to the Bonds at any time by giving notice to the Issuer and the Registrar and
discharging its responsibilities with respect thereto under applicable law. In such event the
Bonds will be transferable in accordance with paragraph (e) hereof.
(d) The execution and delivery of the Representation Letter to DTC, if not previously
filed with DTC, by the Mayor or Manager is hereby authorized and directed.
(e) In the event that any transfer or exchange of Bonds is permitted under paragraph (b)
or (c) hereof, such transfer or exchange shall be accomplished upon receipt by the Registrar of
the Bonds to be transferred or exchanged and appropriate instruments of transfer to the permitted
transferee in accordance with the provisions of this resolution. In the event Bonds in the form of
certificates are issued to owners other than Cede & Co., its successor as nominee for DTC as
owner of all the Bonds, or another securities depository as owner of all the Bonds, the provisions
of this resolution shall also apply to all matters relating thereto, including, without limitation. the
printing of such Bonds in the form of bond certificates and the method of payment of principal of
and interest on such Bonds in the form of bond certificates.
2.9. Form of Bonds. The Bonds shall be prepared in substantially the following form:
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UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF GOLDEN VALLEY
GENERAL OBLIGATION IMPROVEMENT BOND, SERIES 1999B
Interest Rate Maturity Date Date of Original Issue CUSIP No.
August 1, 1999
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
THE CITY OF GOLDEN VALLEY, COUNTY OF HENNEPIN, MINNESOTA, (the
Issuer), acknowledges itself to be indebted and hereby promises to pay to the registered owner
named above, or registered assigns, the principal sum specified above on the maturity date
specified above, with interest thereon from the date hereof at the annual rate specified above,
payable on February 1 and August 1 in each year, commencing August 1, 2000, to the person in
whose name this Bond is registered at the close of business on the fifteenth day (whether or not a
business day) of the immediately preceding month, all subject to the provisions referred to herein
with respect to the redemption of the principal of this Bond before maturity. Interest hereon shall
be computed on the basis of a 360 -day year composed of twelve 30 -day months. The interest
hereon and, upon presentation and surrender hereof, the principal hereof are payable in lawful
money of the United States of America by check or draft or other agreed means of payment by
U.S. Bank Trust National Association, in St. Paul, Minnesota, as Bond Registrar, Transfer Agent
and Paying Agent (the Registrar), or its designated successor under the Resolution described
herein. For the prompt and full payment of such principal and interest as the same respectively
become due, the full faith and credit and taxing powers of the Issuer have been and are hereby
irrevocably pledged.
This Bond is one of an issue in the aggregate principal amount of 55,015,000 issued
pursuant to a resolution adopted by the City Council on July 6, 1999 (the Resolution) to finance
the costs of local improvements, and is issued pursuant to and in full conformity with the
Constitution and laws of the State of Minnesota thereunto enabling, including Minnesota
Statutes, Chapters 429 and 475. The Bonds are issuable only in fully registered form, in
denominations of 55,000 or any integral multiple thereof, of single maturities.
Bonds maturing in 2007 and later years are each subject to redemption and prepayment at
the option of the Issuer, in whole or in part, in such order of maturity dates as the Issuer may
select and, within a maturity, by lot as selected by the Registrar (or, if applicable, by the bond
depository in accordance with its customary procedures) in multiples of 55,000 on February 1,
2006, and on any date thereafter, at a price equal to the principal amount thereof plus interest
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accrued to the date of redemption. The Issuer will cause notice of the call for redemption to be
published as required by law and, at least thirty days prior to the designated redemption date, will
cause notice of the call thereof to be mailed by first class mail to the registered owner of any
Bond to be redeemed at the owner's address as it appears on the bond register maintained by the
Registrar, but no defect in or failure to give such mailed notice of redemption shall affect the
validity of proceedings for the redemption of any Bond not affected by such defect or failure.
Official notice of redemption having been given as aforesaid, the Bonds or portions of Bonds so
to be redeemed shall, on the redemption date, become due and payable at the redemption price
therein specified, and from and after such date (unless the Issuer shall default in the payment of
the redemption price) such Bonds or portions of Bonds shall cease to bear interest. Upon partial
redemption of any Bond, a new Bond or Bonds will be delivered to the registered owner without
charge, representing the remaining principal amount outstanding.
As provided in the Resolution and subject to certain limitations set forth therein, this
Bond is transferable upon the books of the Issuer at the principal office of the Registrar, by the
registered owner hereof in person or by the owner's attorney duly authorized in writing upon
surrender hereof together with a written instrument of transfer satisfactory to the Registrar, duly
executed by the registered owner or the owner's attorney; and may also be surrendered in
exchange for Bonds of other authorized denominations. Upon such transfer or exchange the
Issuer will cause a new Bond or Bonds to be issued in the name of the transferee or registered
owner, of the same aggregate principal amount, bearing interest at the same rate and maturing on
the same date, subject to reimbursement for any tax, fee or governmental charge required to be
paid with respect to such transfer or exchange.
The Issuer and the Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of
receiving payment and for all other purposes, and neither the Issuer nor the Registrar shall be
affected by any notice to the contrary.
Notwithstanding any other provisions of this Bond, so long as this Bond is registered in
the name of Cede & Co., as nominee of The Depository Trust Company, or in the name of any
other nominee of The Depository Trust Company or other securities depository, the Registrar
shall pay all principal of and interest on this Bond, and shall give all notices with respect to this
Bond, only to Cede & Co. or other nominee in accordance with the operational arrangements of
The Depository Trust Company or other securities depository as agreed to by the Issuer.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the Constitution and laws of the State of Minnesota to be done,
to exist, to happen and to be performed preliminary to and in the issuance of this Bond in order to
make it a valid and binding general obligation of the Issuer in accordance with its terms, have
been done, do exist, have happened and have been performed as so required; that, prior to the
issuance hereof, the City Council has by the Resolution covenanted and agreed to levy special
assessments upon property specially benefited by the local improvements financed by the Bonds,
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and ad valorem taxes on all taxable property in the Issuer, which will be collectible for the years
and in amounts sufficient to produce sums not less than five percent in excess of the principal of
and interest on the Bonds when due, and has appropriated such special assessments and taxes to
its General Obligation Improvement Bonds, Serfes '199913 Bond Fund for the payment of such
principal and interest; that if necessary for payment of such principal and interest, additional ad
valorem taxes are required to be levied upon all taxable property in the Issuer, without limitation
as to rate or amount; that the issuance of this Bond, together with all other indebtedness of the
Issuer outstanding on the date hereof and on the date of its actual issuance and delivery, does not
cause the indebtedness of the Issuer to exceed any constitutional or statutory limitation of
indebtedness; and that the opinion printed hereon is a full, true and correct copy of the legal
opinion given by Bond Counsel with reference to the Bonds, dated as of the date of original
delivery of the Bonds.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Resolution until the Certificate of Authentication hereon shall have
been executed by the Registrar by manual signature of one of its authorized representatives.
IN WITNESS WHEREOF, the City of Golden Valley, County of Hennepin, Minnesota,
by its City Council, has caused this Bond to be executed on its behalf by the facsimile signatures
of the Mayor and City Manager.
(facsimile signature - City Manager)
Date of Authentication:
CITY OF GOLDEN VALLEY, MINNESOTA
(facsimile signature - Mayor)
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
U.S. Bank Trust National Association, as Registrar
[Insert legal opinion]
Authorized Representative
The following abbreviations, when used in the inscription on the face of this Bond, shall be
construed as though they were written out in full according to the applicable laws or regulations:
TEN COM - as tenants in common UTMA ................... as Custodian for ...................
(Cult) (Minor)
TEN ENT - as tenants by the entireties under Uniform Transfers to Minors Act ................
(State)
JT TEN -- as joint tenants with right of survivorship and not as tenants in common
Additional abbreviations may also be used.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto the
within Bond and all rights thereunder, and does hereby irrevocably constitute and appoint
attorney to transfer the said Bond on the books kept for registration of the within
Bond, with full power of substitution in the premises.
Dated:
NOTICE: The assignor's signature to this assignment
must correspond with the name as it appears upon the face
of the within Bond in every particular, without alteration
or enlargement or any change whatsoever.
Signature Guaranteed:
Signature(s) must be guaranteed by an "eligible guarantor institution" meeting the requirements
of the Bond Registrar, which requirements include membership or participation in STAMP or
such other "signature guaranty program" as may be determined by the Bond Registrar in addition
to or in substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
[End of form of Bond]
SECTION 3. GENERAL OBLIGATION IMPROVEMENT BONDS. SERIES 1999B
CONSTRUCTION FUND. There is hereby established on the official books and records of the
Issuer a General Obligation Improvement Bonds, Series 1999B Construction Fund (the
Construction Fund), and the Finance Director shall continue to maintain the Construction Fund
until payment of all costs and expenses incurred in connection with the construction of the
Projects have been paid. To the Construction Fund there shall be credited from the proceeds of
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the Bonds, exclusive of unused discount and accrued interest, an amount equal to the estimated
cost of the Projects and from the Construction Fund there shall be paid all construction costs and
expenses. There shall also be credited to the Construction Fund all special assessments collected
with respect to the Projects, until all costs of the Projects have been fully paid. After payment of
all construction costs, the Construction Fund shall be discontinued and any Bond proceeds
remaining therein may be transferred to the other funds or accounts established for construction
of other improvements instituted pursuant to Minnesota Statutes, Chapter 429. All special
assessments on hand in the Construction Fund when terminated or thereafter received, and any
Bond proceeds not so transferred, shall be credited to the General Obligation Improvement
Bonds, Series 1999B Bond Fund of the Issuer.
SECTION 4. GENERAL OBLIGATION IMPROVEMENT BONDS. SERIES 1999B BOND
FUND. So long as any of the Bonds are outstanding and any principal of or interest thereon
unpaid, the Finance Director shall maintain a separate debt service fund on the official books and
records of the Issuer to be known as the General Obligation Improvement Bonds, Series 1999B
Bond Fund (the Bond Fund), and the principal of and interest on the Bonds shall be payable from
the Bond Fund. The Issuer irrevocably appropriates to the Bond Fund (a) any amount in excess
of $4,974,880 received from the Purchaser; (b) all taxes and special assessments levied and
collected in accordance with this Resolution; and (c) all other moneys as shall be appropriated by
the City Council to the Bond Fund from time to time.
There are hereby established two accounts in the Bond Fund, designated as the "Debt
Service Account" and the "Surplus Account." There shall initially be deposited into the Debt
Service Account upon the issuance of the Bonds the amount set forth in (a) above. Thereafter,
during each Bond Year (i.e., each twelve month period commencing on February 2 and ending
on the following February 1), as monies are received into the Bond Fund, the Finance Director
shall first deposit such monies into the Debt Service Account until an amount has been
appropriated thereto sufficient to pay all principal and interest due on the Bonds through the end
of the Bond Year. All subsequent monies received in the Bond Fund during the Bond Year shall
be appropriated to the Surplus Account. If at any time the amount on hand in the Debt Service
Account is insufficient for the payment of principal and interest then due, the Finance Director
shall transfer to the Debt Service Account amounts on hand in the Surplus Account to the extent
necessary to cure such deficiency. Investment earnings (and losses) on amounts from time to
time held in the Debt Service Account and Surplus Account shall be credited or charged to said
accounts.
If the aggregate balance in the Bond Fund is at any time insufficient to pay all interest and
principal then due on all Bonds payable therefrom, the payment shall be made from any fund of
the Issuer which is available for that purpose, subject to reimbursement from the Surplus
Account in the Bond Fund when the balance therein is sufficient, and the City Council covenants
and agrees that it will each year levy a sufficient amount of ad valorem taxes to take care of anv
accumulated or anticipated deficiency, which levy is not subject to any constitutional or statutory
limitation.
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SECTION 5. SPECIAL ASSESSMENTS. The Issuer hereby covenants and agrees that, for the
payment of the cost of the Projects, the Issuer has done or will do and perform all acts and things
necessary for the final and valid levy of special assessments in an amount not less than 20% of
the cost of each of the improvements financed by the Bonds. The Issuer estimates it will levy
special assessments in the aggregate principal amount of $1,107,534. It is estimated that the
principal and interest on such special assessments will be levied and collected in the years and
amounts shown on Appendix I attached hereto. In the event any such assessment shall at any
time be held invalid with respect to any lot or tract of land, due to any error, defect or irregularity
in any action or proceeding taken or to be taken by the Issuer or by the City Council or by any of
the officers or employees of the Issuer, either in the making of such assessment or in the
performance of any condition precedent thereto, the Issuer hereby covenants and agrees that it
will forthwith do all such further things and take all such further proceedings as shall be required
by law to make such assessment a valid and binding lien upon said property.
SECTION 6. PLEDGE OF TAXING POWERS. For the prompt and full payment of the
principal of and interest on the Bonds as such payments respectively become due, the full faith,
credit and unlimited taxing powers of the Issuer shall be and are hereby irrevocably pledged. In
order to produce aggregate amounts which, together with the collections of special assessments
and other amounts as set forth in Section 5, will produce amounts not less than 5% in excess of
the amounts needed to meet when due the principal and interest payments on the Bonds, ad
valorem taxes are hereby levied on all taxable property in the Issuer. The taxes will be levied and
collected in the following years and amounts:
Levv Years Collection Years Amount
1999-2008 2000-2009 See Appendix II- Levy Computation
The taxes shall be irrepealable as long as any of the Bonds are outstanding and unpaid, provided
that the Issuer reserves the right and power to reduce the tax levies in accordance with the
provisions of Minnesota Statutes, Section 475.61.
SECTION 7. DEFEASANCE. When all of the Bonds have been discharged as provided in this
section, all pledges, covenants and other rights granted by this Resolution to the registered
owners of the Bonds shall cease. The Issuer may discharge its obligations with respect to any
Bonds which are due on any date by depositing with the Registrar on or before that date a sum
sufficient for the payment thereof in full; or, if any Bond should not be paid when due, it may
nevertheless be discharged by depositing with the Registrar a sum sufficient for the payment
thereof in full with interest accrued from the due date to the date of such deposit. The Issuer may
also discharge its obligations with respect to any prepayable Bonds called for redemption on any
date when they are prepayable according to their terms, by depositing with the Registrar on or
before that date an amount equal to the principal, interest and redemption premium, if any, which
are then due, provided that notice of such redemption has been duly given as provided herein.
The Issuer may also at any time discharge its obligations with respect to any Bonds, subject to the
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provisions of law now or hereafter authorizing and regulating such action, by depositing
irrevocably in escrow, with a bank qualified by law as an escrow agent for this purpose, cash or
securities which are authorized by law to be so deposited, bearing interest payable at such time
and at such rates and maturing or callable at the holder's option on such dates as shall be required
to pay all principal and interest to become due thereon to maturity or earlier designated
redemption date.
SECTION 8. CERTIFICATION OF PROCEEDINGS.
8.1. Registration of Bonds and Levy of Taxes. The Clerk is hereby authorized and
directed to file a certified copy of this resolution with the County Auditor of Hennepin County
and obtain a certificate that the Bonds have been duly entered upon the Auditor's bond register
and the tax required by law has been levied.
8.2. Authentication of Transcript. The officers of the Issuer and the County Auditor are
hereby authorized and directed to prepare and furnish to the Purchaser and to Dorsey & Whitney
LLP, Bond Counsel, certified copies of all proceedings and records relating to the Bonds and
such other affidavits, certificates and information as may be required to show the facts relating to
the legality and marketability of the Bonds, as the same appear from the books and records in
their custody and control or as otherwise known to them, and all such certified copies, affidavits
and certificates, including any heretofore furnished, shall be deemed representations of the Issuer
as to the correctness of all statements contained therein.
8.3. Official Statement. The Official Statement relating to the Bonds, dated June 22,
1999, prepared and delivered on behalf of the Issuer by Springsted Incorporated, is hereby
approved. Springsted Incorporated, is hereby authorized on behalf of the Issuer to prepare and
distribute to the Purchaser within seven business days from the date hereof, a supplement to the
Official Statement listing the offering price, the interest rates, selling compensation, delivery
date, the underwriters and such other information relating to the Bonds required to be included in
the Official Statement by Rule 15c2-12 adopted by the Securities and Exchange Commission (the
SEC) under the Securities Exchange Act of 1934. The officers of the Issuer are hereby
authorized and directed to execute such certificates as may be appropriate concerning the
accuracy, completeness and sufficiency of the Official Statement.
SECTION 9. TAX COVENANTS: ARBITRAGE MATTERS: RELMBURSEMENT AND
CONTINUING DISCLOSURE.
9.1. General Tax Covenant. The Issuer covenants and agrees with the registered owners
from time to time of the Bonds that it will not take, or permit to be taken by any of its officers,
employees or agents, any actions that would cause interest on the Bonds to become includable in
gross income of the recipient under the Code and applicable Treasury Regulations (the
Regulations), and covenants to take any and all actions within its powers to ensure that the
interest on the Bonds will not become includable in gross income of the recipient under the Code
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and the Regulations. In particular, the Issuer covenants and agrees that all proceeds of the Bonds
deposited in the Construction Fund will be expended solely for the payment of the costs of the
Projects (or other public improvements authorized pursuant to Chapter 429). With the exception
of certain driveway improvements, all improvements so financed will be owned and maintained
by the Issuer as part of the public infrastructure and available for use by members of the general
public on a substantially equal basis. The amount expended for said driveway improvements
shall not exceed, in any event, an amount equal to 5% of the proceeds of the Bonds. The Issuer
shall not enter into any lease, management, use or other agreement or contract with any
non-governmental person relating to the use of the Projects or security for the payment of the
Bonds which might cause the Bonds to be considered "private activity bonds" or "private loan
bonds" pursuant to Section 141 of the Code.
9.2. Certification. The Mayor and Manager being the officers of the Issuer charged with
the responsibility for issuing the Bonds pursuant to this Resolution, are authorized and directed
to execute and deliver to the Purchaser a certificate in accordance with the provisions of Section
148 of the Code, and applicable Regulations, stating the facts, estimates and circumstances in
existence on the date of issue and delivery of the Bonds which make it reasonable to expect that
the proceeds of the Bonds will not be used in a manner that would cause the Bonds to be
"arbitrage bonds" within the meaning of the Code and Regulations.
9.3. Arbitrage Rebate. The Issuer acknowledges that the Bonds are subject to the rebate
requirements of Section 148(f) of the Code. The Issuer covenants and agrees to retain such
records, make such determinations, file such reports and documents and pay such amounts at
such times as are required under Section 148(f) and applicable Regulations to preserve the
exclusion of interest on the Bonds from gross income for federal income tax purposes, unless the
Bonds qualify for an exception from the rebate requirement pursuant to one of the spending
exceptions set forth in Section 1.148-7 of the Regulations and no "gross proceeds" of the Bonds
(other than amounts constituting a "bona fide debt service fund") arise during or after the
expenditure of the original proceeds thereof.
9.4. Reimbursement. The Issuer certifies that the proceeds of the Bonds will not be used
by the Issuer to reimburse itself for any expenditure with respect to the Projects which the Issuer
paid or will have paid more than 60 days prior to the issuance of the Bonds unless, with respect
to such prior expenditures, the Issuer shall have made a declaration of official intent which
complies with the provisions of Section 1.150-2 of the Regulations; provided that this
certification shall not apply (i) with respect to certain de minimis expenditures, if any, with
respect to the Projects meeting the requirements of Section 1.150-2(f)(1) of the Regulations, or
(ii) with respect to "preliminary expenditures" for the Projects as defined in Section 1.150-2(f)(2)
of the Regulations, including engineering or architectural expenses and similar preparatory
expenses, which in the aggregate do not exceed 20% of the "issue price" of the Bonds.
9.5. Continuing Disclosure. (a) Purpose and Beneficiaries. To provide for the public
availability of certain information relating to the Bonds and the security therefor and to permit
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the Purchaser and other participating underwriters in the primary offering of the Bonds to comply
with amendments to Rule 15c2-12 promulgated by the SEC under the Securities Exchange Act of
1934 (17 C.F.R. § 240.15c2-12), relating to continuing disclosure (as in effect and interpreted
from time to time, the Rule), which will enhance the marketability of the Bonds, the Issuer
hereby makes the following covenants and agreements for the benefit of the Owners (as
hereinafter defined) from time to time of the Outstanding Bonds. The Issuer is the only obligated
person in respect of the Bonds within the meaning of the Rule for purposes of identifying the
entities in respect of which continuing disclosure must be made. The Issuer has complied in all
material respects with any undertaking previously entered into by it under the Rule. If the Issuer
fails to comply with any provisions of this section, any person aggrieved thereby, including the
Owners of any Outstanding Bonds, may take whatever action at law or in equity may appear
necessary or appropriate to enforce performance and observance of any agreement or covenant
contained in this section, including an action for a writ of mandamus or specific performance.
Direct, indirect, consequential and punitive damages shall not be recoverable for any default
hereunder to the extent permitted by law. Notwithstanding anything to the contrary contained
herein, in no event shall a default under this section constitute a default under the Bonds or under
any other provision of this resolution. As used in this section, Owner or Bondowner means, in
respect of a Bond, the registered owner or owners thereof appearing in the bond register
maintained by the Registrar or any Beneficial Owner (as hereinafter defined) thereof, if such
Beneficial Owner provides to the Registrar evidence of such beneficial ownership in form and
substance reasonably satisfactory to the Registrar. As used herein, Beneficial Owner means, in
respect of a Bond, any person or entity which (i) has the power, directly or indirectly, to vote or
consent with respect to, or to dispose of ownership of, such Bond (including persons or entities
holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the
owner of the Bond for federal income tax purposes.
(b) Information To Be Disclosed. The Issuer will provide, in the manner set forth in subsection
(c) hereof, either directly or indirectly through an agent designated by the Issuer, the following
information at the following times:
(I) on or before 365 days after the end of each fiscal year of the Issuer.
commencing with the fiscal year ending December 31, 1999, the following financial
information and operating data in respect of the Issuer (the Disclosure Information):
(A) the audited financial statements of the Issuer for such fiscal year,
containing balance sheets as of the end of such fiscal year and a statement of
operations, changes in fund balances and cash flows for the fiscal year then ended,
showing in comparative form such figures for the preceding fiscal year of the
Issuer, prepared in accordance with generally accepted accounting principles
promulgated by the Financial Accounting Standards Board as modified in
accordance with the governmental accounting standards promulgated by the
Governmental Accounting Standards Board or as otherwise provided under
Minnesota law, as in effect from time to time, or, if and to the extent such
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i��
financial statements have not been prepared in accordance with such generally
accepted accounting principles for reasons beyond the reasonable control of the
Issuer, noting the discrepancies therefrom and the effect thereof, and certified as
to accuracy and completeness in all material respects by the fiscal officer of the
Issuer; and
(B) to the extent not included in the financial statements referred to in
paragraph (A) hereof, the information for such fiscal year or for the period most
recently available of the type contained in the Official Statement under headings:
City Property Values; City Indebtedness; and City Tax Rates, Levies and
Collections.
Notwithstanding the foregoing paragraph, if the audited financial statements are not available by
the date specified, the Issuer shall provide on or before such date unaudited financial statements
in the format required for the audited financial statements as part of the Disclosure Information
and, within 10 days after the receipt thereof, the Issuer shall provide the audited financial
statements. Any or all of the Disclosure Information may be incorporated by reference, if it is
updated as required hereby, from other documents, including official statements, which have
been submitted to each of the repositories hereinafter referred to under subsection (c) or the SEC.
If the document incorporated by reference is a final official statement, it must be available from
the Municipal Securities Rulemaking Board. The Issuer shall clearly identify in the Disclosure
Information each document so incorporated by reference. If any part of the Disclosure
Information can no longer be generated because the operations of the Issuer have materially
changed or been discontinued, such Disclosure Information need no longer be provided if the
Issuer includes in the Disclosure Information a statement to such effect; provided, however, if
such operations have been replaced by other Issuer operations in respect of which data is not
included in the Disclosure Information and the Issuer determines that certain specified data
regarding such replacement operations would be a Material Fact (as defined in paragraph (2)
hereof), then, from and after such determination, the Disclosure Information shall include such
additional specified data regarding the replacement operations. If the Disclosure Information is
changed or this section is amended as permitted by this paragraph (b)(1) or subsection (d), then
the Issuer shall include in the next Disclosure Information to be delivered hereunder, to the
extent necessary, an explanation of the reasons for the amendment and the effect of any change in
the type of financial information or operating data provided.
(2) In a timely manner, notice of the occurrence of any of the following events
which is a Material Fact (as hereinafter defined):
(A) Principal and interest payment delinquencies;
(B) Non-payment related defaults;
(C) Unscheduled draws on debt service reserves reflecting financial
difficulties;
(D) Unscheduled draws on credit enhancements reflecting financial difficulties:
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(E) Substitution of credit or liquidity providers, or their failure to perform;
(F) Adverse tax opinions or events affecting the tax-exempt status of the
security;
(G) Modifications to rights of security holders;
(H) Bond calls;
(I) Defeasances;
(J) Release, substitution, or sale of property securing repayment of the
securities; and
(K) Rating changes.
As used herein, a Material Fact is a fact as to which a substantial likelihood exists that a
reasonably prudent investor would attach importance thereto in deciding to buy, hold or sell a
Bond or, if not disclosed, would significantly alter the total information otherwise available to an
investor from the Official Statement, information disclosed hereunder or information generally
available to the public. Notwithstanding the foregoing sentence, a Material Fact is also an event
that would be deemed material for purposes of the purchase, holding or sale of a Bond within the
meaning of applicable federal securities laws, as interpreted at the time of discovery of the
occurrence of the event.
(3) In a timely manner, notice of the occurrence of any of the following events or
conditions:
(A) the failure of the Issuer to provide the Disclosure Information required
under paragraph (b)(1) at the time specified thereunder;
(B) the amendment or supplementing of this section pursuant to subsection
(d), together with a copy of such amendment or supplement and any explanation
provided by the Issuer under subsection (d)(2);
(C) the termination of the obligations of the Issuer under this section pursuant
to subsection (d);
(D) any change in the accounting principles pursuant to which the financial
statements constituting a portion of the Disclosure Information are prepared; and
(E) any change in the fiscal year of the Issuer.
(c) Manner of Disclosure. The Issuer agrees to make available the information described in
subsection (b) to the following entities by telecopy, overnight delivery, mail or other means, as
appropriate:
(1) the information described in paragraph (1) of subsection (b), to each then
nationally recognized municipal securities information repository under the Rule and to
any state information depository then designated or operated by the State of Minnesota as
contemplated by the Rule (the State Depository), if any;
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(2) the information described in paragraphs (2) and (3) of subsection (b), to the
Municipal Securities Rulemaking Board and to the State Depository, if any; and
(3) the information described in subsection (b), to any rating agency then
maintaining a rating of the Bonds at the request of the Issuer and, at the expense of such
Bondowner, to any Bondowner who requests in writing such information, at the time of
transmission under paragraphs (1) or (2) of this subsection (c), as the case may be, or, if
such information is transmitted with a subsequent time of release, at the time such
information is to be released.
(d) Term; Amendments; Interpretation.
(1) The covenants of the Issuer in this section shall remain in effect so long as
any Bonds are Outstanding. Notwithstanding the preceding sentence, however, the
obligations of the Issuer under this section shall terminate and be without further effect as
of any date on which the Issuer delivers to the Registrar an opinion of Bond Counsel to
the effect that, because of legislative action or final judicial or administrative actions or
proceedings, the failure of the Issuer to comply with the requirements of this section will
not cause participating underwriters in the primary offering of the Bonds to be in
violation of the Rule or other applicable requirements of the Securities Exchange Act of
1934, as amended, or any statutes or laws successory thereto or amendatory thereof.
(2) This section (and the form and requirements of the Disclosure Information)
may be amended or supplemented by the Issuer from time to time, without notice to
(except as provided in paragraph (c)(3) hereof) or the consent of the Owners of any
Bonds, by a resolution of this Council filed in the office of the recording officer of the
Issuer accompanied by an opinion of Bond Counsel, who may rely on certificates of the
Issuer and others and the opinion may be subject to customary qualifications, to the effect
that: (i) such amendment or supplement (a) is made in connection with a change in
circumstances that arises from a chance in law or regulation or a change in the identity,
nature or status of the Issuer or the type of operations conducted by the Issuer, or (b) is
required by, or better complies with, the provisions of paragraph (b)(5) of the Rule; (ii)
this section as so amended or supplemented would have complied with the requirements
of paragraph (b)(5) of the Rule at the time of the primary offering of the Bonds, giving
effect to any change in circumstances applicable under clause (i)(a) and assuming that the
Rule as in effect and interpreted at the time of the amendment or supplement was in effect
at the time of the primary offering; and (iii) such amendment or supplement does not
materially impair the interests of the Bondowners under the Rule.
If the Disclosure Information is so amended, the Issuer agrees to provide,
contemporaneously with the effectiveness of such amendment, an explanation of the
reasons for the amendment and the effect, if any, of the change in the type of financial
information or operating data being provided hereunder.
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Attest:
(3) This section is entered into to comply with the continuing disclosure
provisions of the Rule and should be construed so as to satisfy the requirements of
paragraph (b)(5) of the Rule.
Adopted this 6' day of July, 1999.
City Clerk
Mayor
Upon vote being taken on the foregoing resolution, the following voted in favor thereof:
and the following voted against the same:
whereupon the resolution was declared duly passed and adopted.
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