Loading...
2. EDSR 02-04-2013 El REQUEST FOR ACTION River To ITEM NUMBER Economic Development Authori 2. AGENDA SECTION MEETING DATE PREPARED BY General Business February 4, 2013 Tim Simon,Finance Director ITEM DESCRIPTION REVIEWED By Resolution authorizing the issuance of General Obligation Refunding Bonds, Series 2013A REVIEWED BY ACTION REQUESTED The Economic Development Authority is asked to adopt a resolution authorizing the issuance of General Obligation Refunding Bonds, Series 2013A,providing for their issuance and levying a tax for the payment thereof. BACKGROUND/DISCUSSION On December 10, 2012 the Economic Development Authority (EDA) held a public hearing, adopted a parameters resolution and established a pricing committee to review and either reject or accept the bonds on the sale date. The pricing committee consisted of the EDA president, EDA executive director, City Administrator,Mayor, and Finance Director. On January 15,2013 the pricing committee met and approved awarding the bond sale to Raymond James &Associates, Inc.,Memphis,TN. A total of 5 bids were received. In addition,Raymond James & Associates, Inc. paid a premium of over$340,000 so we were able to change the bond size. The true interest cost is 2.19 percent and the savings will be $795,866 present value and$1,001,112 over the life of the bonds. The parameters resolution established a minimum of 5% savings and the actual savings is 7.83%. In addition, staff held a rating call with Standard and Poor's(S&P) on January 7,2013 and S&P reaffirmed the credit rating of AA+ for the City. Mark Ruff of Ehlers and Associates will be at the EDA meeting to present the results of the sale and credit rating. FINANCIAL IMPACT Based on the true interest rate of 2.19% the refunding the bonds will yield a present value savings of over 7.83% or$795,866. This results in$1,001,112 in savings over the life of the refunding bonds. Also, as part the of the original lease agreement the YMCA will continue to pay the one-third of the principal and interest. r I ■ E A E I B Y N:\Departments\Community Development\Economic Development\EDA to move\Agenda\Year2013\2-4-2013 Spec ATUREI Mtg\YMCAbondrefunding.docx ATTACHMENTS • Sale report • A resolution awarding the issuance of General Obligation Refunding Bonds, Series 2013A, providing for their issuance and levying a tax for the payment thereof. • YMCA resolution of consent for the refunding bonds. • Standard and Poor's rating report. Action Motion by Second by Vote Follow Up N:\Public Bodies\City Council\Finance\Tim\2013\YMCAbondrefunding.docx Debt Issuance Services January 15, 2013 Sale Report Economic Development Authority of the City of Elk River, Minnesota Elk River \AAwehlers-inc,com 0 E H L E RS Mtnnesota phone 651-697-8500 3060 Centre Pointe Drive LEADERS IN PUBLIC FINANCE Offices also in Wisconsin and Illinois fax 651-697-8555 Roseville,MN 55113-1122 Debt Issuance Services Economic Development Authority of the City of Elk River, Minnesota Results of Bond Sale — January 15, 2013 $9,685,000 General Obligation Refunding Bonds, Series 2013A Purpose: To effect an advance crossover refunding of the 2018 through 2033 maturities of the Authority's $10,000,000 General Obligation Bonds, Series 2007, dated November 8, 2007. Rating: Standard&Poor's Credit Markets "AA+" Number of Bids: 5 Low Bidder: Raymond James&Associates, Inc., Memphis, TN True Interest Cost: 2.1969% Interest Savings from Low/High Bid Low Bid High Bid Lowest to Highest Bid: Difference 2.1950% 2.3353% $127,382 Summary of Results: Projected Results of Sale Difference Principal Amount*: $9,965,000 $9,685,000 -$280,000 Reoffering Premium: $0 $341,700 $341,700 Discount Allowance: $99,650 $83,645 -$16,005 True Interest Cost: 2.0830% 2.1969% 0.11% Cost of Issuance: $65,000 $70,150 $5,150 Future Value Savings: $1,060,179 $1,001,112 -$59,067 Present Value Savings: $826,451 $795,866 -$30,585 Savings Percentage: 8.186% 7.830% -0.356% Closing Date: February 12, 2013 Council Action: A Resolution Providing For The Sale Of General Obligation Refunding Bonds, Series 2013A; Fixing Their Form And Specifications; Directing Their Execution And Delivery;And Providing For Their Payment Attachments: • Bid Tabulation • Updated Debt Service Schedules • Bond Resolution (Distributed in Council Packets) *Principal amount changed due to a premium on the bid from the low bidder. The TIC was adjusted slightly after the bid. .ehlers-inc,com E H L E RS Minnesota phone 651-697-8500 3060 Centre Pointe Drive LEADERS IN PUBLIC FINANCE Offices also in Wisconsin and Illinois fax 651-697-8555 Roseville,MN 55113-1122 BID TABULATION $9,855,000* General Obligation Refunding Bonds, Series 2013A ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF ELK RIVER, MINNESOTA SALE: January 15, 2013 AWARD: RAYMOND JAMES&ASSOCIATES, INC. RATING: Standard &Poor's Credit Markets"AA+" BBI: 3.60% NET TRUE NAME OF BIDDER MATURITY RATE REOFFERING PRICE INTEREST INTEREST (February 1) YIELD COST RATE RAYMOND JAMES&ASSOCIATES, INC. 2018 2.000% 0.850% $10,116,706.35 $2,877,527.38 2.1950% Memphis,Tennessee 2019 2.000% 1.000% 2020 2.000% 1.200% 2021 2.000% 1.400% 2022 2.000% 1.550% 2023 2.000% 1.650% 2024 2.000% 1.700% 2025 2.000% 1.800% 2026 2.000% 1.850% 2027 2.250% 2.000% 2028 2.375% 2.050% 2029 2.500% 2.150% 2030 2.750% 2.300% 2031 2.750% 2.400% 2032 3.000% 2.500% 2033 3.000% 2.600% STIFEL, NICOLAUS&COMPANY, 2018 1.500% $10,028,779.05 $2,874,399.28 2.2041% INCORPORATED 2019 1.500% Denver, CO 2020 2.000% 2021 2.000% 2022 2.000% 2023 2.000% 2024 2.000% 2025 2.000% 2026 2.000% 2027 2.000% 2028 2.500% 2029 2.500% 2030 2.500% 2031 3.000% 2032 3.000% 2033 2.625% *Subsequent to bid opening the issue size was decreased to$9,685,000. Adjusted Price-$9,943,055.37 Adjusted Net Interest Cost-$2,831,475.15 Adjusted TIC-2.1969% 0 EHLERS Minnesota phone 651-697-8500 3060 Centre Pointe Drive LEADERS IN PUBLIC FINANCE Offices also in Wisconsin and Illinois fax 651-697-8555 Roseville,MN 55113-1122 $9,855,000 General Obligation Refunding Bonds, Series 2013A Page 2 Economic Development Authority of the City of Elk River, Minnesota NET TRUE NAME OF BIDDER MATURITY RATE REOFFERING PRICE INTEREST INTEREST (February 1) YIELD COST RATE PIPER JAFFRAY&CO. 2018 2.000% $9,957,976.80 $2,955,017.73 2.2797% Minneapolis, Minnesota 2019 2.000% 2020 2.000% 2021 2.000% 2022 2.000% 2023 2.000% 2024 2.000% 2025 2.000% 2026 2.250% 2027 2.250% 2028 2.375% 2029 2.500% 2030 2.625% 2031 2.625% 2032 2.750% 2033 2.750% STERNE AGEE 2018 2.000% $9,969,276.30 $2,991,264.26 2.3067% Birmingham,Alabama 2019 2.000% 2020 2.000% 2021 2.000% 2022 2.000% 2023 2.000% 2024 2.250% 2025 2.250% 2026 2.250% 2027 2.250% 2028 2.500% 2029 2.500% 2030 2.500% 2031 2.750% 2032 2.750% 2033 2.750% BAIRD 2018 2.000% $9,839,308.30 $3,004,909.17 2.3353% Milwaukee,Wisconsin 2019 2.000% 2020 2.000% 2021 2.000% 2022 2.000% 2023 2.000% 2024 2.000% 2025 2.000% 2026 2.000% 2027 2.150% 2028 2.250% 2029 2.400% 2030 2.500% 2031 2.600% 2032 2.700% 2033 2.800% City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Table of Contents Report Sources&Uses 1 Prior Original Debt Service 2 Debt Service Schedule 3 Debt Service Comparison 4 Crossover Escrow Fund Total Principal+Interest 5 Crossover Escrow Fund Adjusted Receipts 6 Crossover Escrow Fund Cashflow 7 Series 2013 Xovr Ref Ser I SINGLE PURPOSE 1 1/15/2013 I 12:50 PM EHLERS LEADERS IN PUBLIC FINANCE City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Sources & Uses Dated 02/12/2013 i Delivered 02/12/2013 Sources Of Funds Par Amount of Bonds $9,685,000.00 Reoffering Premium 341,700.45 Total Sources $10,026,700.45 Uses Of Funds Total Underwriter's Discount (0.864%) 83,645.08 Costs of Issuance 70,150.00 Deposit to Crossover Escrow Fund 9,871,525.68 Rounding Amount 1,379.69 Total Uses $10,026,700.45 Series 2013 Xovr Ref Ser I SINGLE PURPOSE I 1/15/2013 I 12:50 PM EHLERS LEASERS IN PUBLIC FINANCE Page 1 City of Elk River (EDA), MN $10,000,000 G.O. Bonds, Series 2007 Prior Original Debt Service Date Principal Coupon Interest Total P+I Fiscal Total 08/01/2013 - - 192,659.41 192,659.41 - 02/01/2014 - - 205,199.38 205,199.38 397,858.79 08/01/2014 - - 205,199.38 205,199.38 - 02/01/2015 - - 205,199.38 205,199.38 410,398.76 08/01/2015 - - 205,199.38 205,199.38 - 02/01/2016 380,000.00 3.800% 205,199.38 585,199.38 790,398.76 08/01/2016 - - 197,979.38 197,979.38 - 02/01/2017 395,000.00 3.800% 197,979.38 592,979.38 790,958.76 08/01/2017 - - 190,474.38 190,474.38 - 02/01/2018 410,000.00 3.800% 190,474.38 600,474.38 790,948.76 08/01/2018 - - 182,684.38 182,684.38 - 02/01/2019 430,000.00 3.850% 182,684.38 612,684.38 795,368.76 08/01/2019 - - 174,406.88 174,406.88 - 02/01/2020 445,000.00 3.900% 174,406.88 619,406.88 793,813.76 08/01/2020 - - 165,729.38 165,729.38 - 02/01/2021 465,000.00 3.950% 165,729.38 630,729.38 796,458.76 08/01/2021 - - 156,545.63 156,545.63 - 02/01/2022 485,000.00 4.000% 156,545.63 641,545.63 798,091.26 08/01/2022 - - 146,845.63 146,845.63 - 02/01/2023 505,000.00 4.050% 146,845.63 651,845.63 798,691.26 08/01/2023 - - 136,619.38 136,619.38 - 02/01/2024 525,000.00 4.050% 136,619.38 661,619.38 798,238.76 08/01/2024 - - 125,988.13 125,988.13 - 02/01/2025 550,000.00 4.100% 125,988.13 675,988.13 801,976.26 08/01/2025 - - 114 713.13 114,713.13 - 02/01/2026 575,000.00 4.125% 114,713.13 689,713.13 804,426.26 08/01/2026 - - 102,853.75 102,853.75 - 02/01/2027 600,000.00 4.150% 102,853.75 702,853.75 805,707.50 08/01/2027 - - 90,403.75 90,403.75 - 02/01/2028 625,000.00 4.200% 90,403.75 715,403.75 805,807.50 08/01/2028 - - 77,278.75 77,278.75 - 02/01/2029 655,000.00 4.250% 77,278.75 732,278.75 809,557.50 08/01/2029 - - 63,360.00 63,360.00 - 02/01/2030 690,000.00 4.250% 63,360.00 753,360.00 816,720.00 08/01/2030 - - 48,697.50 48,697.50 - 02/01/2031 720,000.00 4.300% 48,697.50 768,697.50 817,395.00 08/01/2031 - - 33,217.50 33,217.50 - 02/01/2032 755,000.00 4.300% 33,217.50 788,217.50 821,435.00 08/01/2032 - - 16,985.00 16,985.00 - 02/01/2033 790,000.00 4.300% 16 985.00 806 985.00 823 970.00 Total $10,000,000.00 - $5,268,221.41 $15,268,221.41 - Yield Statistics Base date for Av_.Life&Av_.Cou.on Calculation 2/12/2013 Average Life 12.623 Years Average Coupon 4.1733629% Wei kited Avera_e Maturit Par Basis 12.623 Years Refunding Bond Information Refunding Dated Date 2/12/2013 Refundin_Delive Date 2/12/2013 Ser 2007 EDA$10MM GO Bds I SINGLE PURPOSE I 1/15/2013 I 12:50 PM ink VP EHLERS L AUOR$IN PV#B1,IC FINANCE Page 2 City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Debt Service Schedule Date Principal Coupon Interest Total P+I Fiscal Total 02/12/2013 - - - - - 08/01/2013 - - 105,924.27 105,924.27 - 02/01/2014 - - 112,818.75 112,818.75 218,743.02 08/01/2014 - - 112,818.75 112,818.75 - 02/01/2015 - - 112,818.75 112,818.75 225,637.50 08/01/2015 - - 112,818.75 112,818.75 - 02/01/2016 - - 112,818.75 112,818.75 225,637.50 08/01/2016 - - 112,818.75 112,818.75 - 02/01/2017 - - 112,818.75 112,818.75 225,637.50 08/01/2017 - - 112,818.75 112,818.75 02/01/2018 505,000.00 2.000% 112,818.75 617,818.75 730,637.50 08/01/2018 - - 107,768.75 107,768.75 - 02/01/2019 515,000.00 2.000% 107,768.75 622,768.75 730,537.50 08/01/2019 - - 102,618.75 102,618.75 - 02/01/2020 525,000.00 2.000% 102,618.75 627,618.75 730,237.50 08/01/2020 - - 97,368.75 97,368.75 - 02/01/2021 540,000.00 2.000% 97,368.75 637,368.75 734,737.50 08/01/2021 - - 91,968.75 91,968.75 - 02/01/2022 550,000.00 2.000% 91,968.75 641,968.75 733,937.50 08/01/2022 - - 86,468.75 86,468.75 02/01/2023 565,000.00 2.000% 86,468.75 651,468.75 737,937.50 08/01/2023 - - 80,818.75 80,818.75 - 02/01/2024 575,000.00 2.000% 80,818.75 655,818.75 736,637.50 08/01/2024 - - 75,068.75 75,068.75 - 02/01/2025 590,000.00 2.000% 75,068.75 665,068.75 740,137.50 08/01/2025 - - 69,168.75 69,168.75 - 02/01/2026 605,000.00 2.000% 69,168.75 674,168.75 743,337.50 08/01/2026 - - 63,118.75 63,118.75 - 02/01/2027 615,000.00 2.250% 63,118.75 678,118.75 741,237.50 08/01/2027 - - 56,200.00 56,200.00 02/01/2028 630,000.00 2.375% 56,200.00 686,200.00 742,400.00 08/01/2028 - - 48,718.75 48,718.75 - 02/01/2029 650,000.00 2.500% 48,718.75 698,718.75 747,437.50 08/01/2029 - - 40,593.75 40,593.75 - 02/01/2030 675,000.00 2.750% 40,593.75 715,593.75 756,187.50 08/01/2030 - - 31,312.50 31,312.50 - 02/01/2031 690,000.00 2.750% 31,312.50 721,312.50 752,625.00 08/01/2031 - - 21,825.00 21,825.00 - 02/01/2032 715,000.00 3.000% 21,825.00 736,825.00 758,650.00 08/01/2032 - - 11,100.00 11,100.00 - 02/01/2033 740,000.00 3.000% 11,100.00 751,100.00 762,200.00 Total $9,685,000.00 - $3,089,530.52 $12,774,530.52 - Yield Statistics Bond Year Dollars $125,924.07 Average Life 13.002 Years Average Coupon 2.4534869% Net Interest Cost(NIC) 2.2485575% True Interest Cost(TIC) 2.1969425% Bond Yield for Arbitra_e Pu poses 1.9428772% All Inclusive Cost(AIC) 2.2610753% IRS Form 8038 Net Interest Cost 2.1113177% Weighted Average Maturity 12.980 Years Series 2013 Xovr Ref Ser I SINGLE PURPOSE 1 1/15/2013( 12:50 PM EHLERS LEADERS IN PUBLIC FINANCE Page 3 City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Debt Service Comparison Const Loan Date Total P+I Pmt Existing D/S Net New D/S Old Net D/S Savings 02/01/2014 218,743.02 (218,743.02) 397,858.79 396,479.10 397,858.79 1,379.69 02/01/2015 225,637.50 (225,637.50) 410,398.76 410,398.76 410,398.76 - 02/01/2016 225,637.50 (225,637.50) 790,398.76 790,398.76 790,398.76 - 02/01/2017 225,637.50 (9,450,638.86) 10,015,958.76 790,957.40 790,958.76 1.36 02/01/2018 730,637.50 - - 730,637.50 790,948.76 60,311.26 02/01/2019 730,537.50 - - 730,537.50 795,368.76 64,831.26 02/01/2020 730,237.50 - - 730,237.50 793,813.76 63,576.26 02/01/2021 734,737.50 - - 734,737.50 796,458.76 61,721.26 02/01/2022 733,937.50 - - 733,937.50 798,091.26 64,153.76 02/01/2023 737 937.50 - - 737,937.50 798,691.26 60,753.76 02/01/2024 736,637.50 - - 736,637.50 798,238.76 61,601.26 02/01/2025 740,137.50 - - 740,137.50 801,976.26 61,838.76 02/01/2026 743,337.50 - - 743,337.50 804,426.26 61,088.76 02/01/2027 741,237.50 - - 741,237.50 805,707.50 64,470.00 02/01/2028 742,400.00 - - 742,400.00 805,807.50 63,407.50 02/01/2029 747,437.50 - - 747,437.50 809,557.50 62,120.00 02/01/2030 756,187.50 - - 756,187.50 816,720.00 60,532.50 02/01/2031 752,625.00 - - 752,625.00 817,395.00 64,770.00 02/01/2032 758,650.00 - - 758,650.00 821,435.00 62,785.00 02/01/2033 762,200.00 - - 762,200.00 823,970.00 61,770.00 Total $12,774,530.52 (10,120,656.88) $11,614,615.07 $14,267,109.02 $15,268,221.41 $1,001,112.39 PV Analysis Summary(Net to Net) Gross PV Debt Service Savin•s 794,486.16 Net PV Cashflow Savings nu, 1.943%(Bond Yield) 794,486.16 Contingency or Rounding Amount 1,379.69 Net Present Value Benefit $795,865.85 Net PV Benefit/$10,163,686.31 PV Refunded Debt Service 7.830% Net PV Benefit/ $9,225,000 Refunded Principal... 8.627% Net PV Benefit/ $9,685,000 Re£undin_Princi.al.. 8.218% Refunding Bond Information Refundin•Dated Date 2/12/2013 Refunding Delivery Date 2/12/2013 Series 2013 Xovr Ref Ser I SINGLE PURPOSE I 1/15/2013 I 12:50 PM 0 EHLERS LEADERS IN PUBLIC FINANCE Page 4 City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Crossover Escrow Fund Total Principal + Interest Date Principal Rate Interest Total P+I 02/12/2013 - - - - 07/30/2013 - - 57,868.75 57,868.75 07/31/2013 153,000.00 0.375% 2,746.88 155,746.88 01/30/2014 - - 57,868.75 57,868.75 01/31/2014 - - 2,460.00 2,460.00 07/30/2014 - - 57,868.75 57,868.75 07/31/2014 - - 2,460.00 2,460.00 01/30/2015 - - 57,868.75 57,868.75 01/31/2015 104,000.00 2.250% 2,460.00 106,460.00 07/30/2015 - - 57,868.75 57,868.75 07/31/2015 - - 1,290.00 1,290.00 01/30/2016 - - 57,868.75 57,868.75 01/31/2016 129,000.00 2.000% 1,290.00 130,290.00 07/30/2016 - - 57,868.75 57,868.75 01/30/2017 9,259,000.00 1.250% 57,868.75 9,316,868.75 Total $9,645,000.00 - $475,656.88 $10,120,656.88 Series 2013 Xovr Ref Ser I SINGLE PURPOSE I 1/15/2013 I 12:50 PM 0 EHLERS LEADERS IN PUBLIC FINANCE Page 5 City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Crossover Escrow Fund Adjusted Receipts Zero Date Total P+I Coupon Reinvestment Net P+I 02/12/2013 - - - - 07/30/2013 57,868.75 (57,868.00) - 0.75 07/31/2013 155,746.88 (49,823.00) - 105,923.88 01/30/2014 57,868.75 (55,201.00) - 2,667.75 01/31/2014 2,460.00 - - 2,460.00 02/01/2014 - - 107,691.00 107,691.00 07/30/2014 57,868.75 (2,711.00) - 55,157.75 07/31/2014 2,460.00 - - 2,460.00 08/01/2014 - - 55,201.00 55,201.00 01/30/2015 57,868.75 - - 57,868.75 01/31/2015 106,460.00 - - 106,460.00 02/01/2015 - - 2,711.00 2,711.00 02/02/2015 - (54,221.00) - (54,221.00) 07/30/2015 57,868.75 - - 57,868.75 07/31/2015 1 290.00 - - 1 290.00 08/01/2015 - - 54,221.00 54,221.00 01/30/2016 57,868.75 - - 57,868.75 01/31/2016 130,290.00 - - 130,290.00 02/01/2016 - (75,901.00) - (75,901.00) 07/30/2016 57,868.75 - - 57,868.75 08/01/2016 - - 54,950.00 54,950.00 01/30/2017 9,316,868.75 - - 9,316,868.75 02/01/2017 - - 20,951.00 20,951.00 Total $10,120,656.88 (295,725.00) $295,725.00 $10,120,656.88 Series 2013 Xovr Ref Ser I SINGLE PURPOSE 1 1/15/2013 12:50 PM EHLERS 0 LEADERS IN PUBLIC FINANCE Page 6 City of Elk River, Minnesota $9,685,000 G.O. Refunding Bonds, Series 2013A Crossover Refunding of $10,000,000 G.O. Bonds, Series 2007 Crossover Escrow Fund Cashflow Date Net P+I -Transfers Receipts Disbursements Cash Balance 02/12/2013 - - - - - 07/30/2013 0.75 - 0.75 - 0.75 07/31/2013 105,923.88 - 105,923.88 - 105,924.63 08/01/2013 - - - 105,924.27 0.36 01/30/2014 2,667.75 - 2,667.75 - 2,668.11 01/31/2014 2,460.00 - 2,460.00 - 5,128.11 02/01/2014 107,691.00 - 107,691.00 112,818.75 0.36 07/30/2014 55,157.75 - 55,157.75 - 55,158.11 07/31/2014 2,460.00 - 2,460.00 - 57,618.11 08/01/2014 55,201.00 - 55,201.00 112,818.75 0.36 01/30/2015 57,868.75 - 57,868.75 - 57,869.11 01/31/2015 106,460.00 - 106,460.00 - 164,329.11 02/01/2015 2,711.00 - 2,711.00 112,818.75 54,221.36 02/02/2015 (54,221.00) - (54,221.00) - 0.36 07/30/2015 57 868.75 - 57 868.75 - 57 869.11 07/31/2015 1,290.00 - 1,290.00 - 59,159.11 08/01/2015 54,221.00 - 54,221.00 112,818.75 561.36 01/30/2016 57,868.75 - 57,868.75 - 58,430.11 01/31/2016 130,290.00 - 130,290.00 - 188,720.11 02/01/2016 (75,901.00) - (75,901.00) 112,818.75 0.36 07/30/2016 57,868.75 - 57,868.75 - 57,869.11 08/01/2016 54,950.00 - 54,950.00 112,818.75 0.36 01/30/2017 9,316,868.75 - 9,316,868.75 - 9,316,869.11 02/01/2017 20,951.00 (1.36) 20,951.00 9,337,818.75 - Total $10,120,656.88 (1.36) $10,120,656.88 $10,120,655.52 - Investment Parameters Investment Model[PV,GIC,or Securities' Securities Default investment yield target Bond Yield Cost of Investments Purchased with Bond Proceeds 9,871,525.68 Total Cost of Investments $9,871,525.68 Target Cost of Investments at bond yield $9,401,494.08 Actual sositive or ne•ative arbitra_e (470,031.60) Yield to Receipt 0.6549193% Yield for Arbitrage Purposes 1.9428772% Series 2013 Xovr Ref Ser I SINGLE PURPOSE I 1/15/2013 I 12:50 PM EHLERS LENDERS IN PUBLIC FINANCE Page 7 EXTRACT OF MINUTES OF A MEETING OF THE BOARD OF COMMISSIONERS OF THE ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF ELK RIVER, MINNESOTA HELD: FEBRUARY 4, 2013 Pursuant to due call and notice thereof, a regular or special meeting of the Board of Commissioners of the Economic Development Authority for the City of Elk River, Sherburne County, Minnesota, was duly held at the City Hall, in the City of Elk River on February 4, 2013 at 6:00 P.M. The following members were present: and the following were absent: Member introduced the following resolution and moved its adoption: RESOLUTION NO. 13-01 RESOLUTION AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS, SERIES 2013A, PROVIDING FOR THEIR ISSUANCE AND LEVYING A TAX FOR THE PAYMENT THEREOF A. WHEREAS, the Board of Commissioners of the Economic Development Authority for the City of Elk River, Minnesota (the "Authority"), has heretofore determined that it is necessary and expedient to issue its General Obligation Refunding Bonds, Series 2013A to refund in advance of maturity and at their redemption date the 2018 to 2033 maturities of the Authority's General Obligation Bonds, Series 2007B, dated November 8, 2007 (the "Refunded Bonds"), of which$9,225,000 in principal amount is callable on February 1, 2017; and B. WHEREAS, the City of Elk River, Minnesota (the "City") has, by its Ordinance No. 12-19, adopted on December 10, 2012 (the "Ordinance") in accordance with Minnesota Statutes, Section 469.060, consented to the pledge of its full faith, credit and resources to the payment of the Bonds; and C. WHEREAS, offers to purchase the Bonds were solicited on behalf of the Authority by Ehlers and Associates, Inc. ("Ehlers"); and D. WHEREAS, it is in the best interests of the Authority that the Bonds be issued in book-entry form as hereinafter provided; and NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority for the City of Elk River, Minnesota, as follows: 1. Acceptance of Offer. The offer of Raymond James & Associates, Inc. (the "Purchaser"), to purchase the Bonds in accordance with the terms of proposal, at the rates of interest hereinafter set forth, and to pay therefor the sum of$9,943,055.37, was determined by 414396v3 JSB EL185-21 the Pricing Committee in accordance with Resolution No. 12-05, adopted December 10, 2012, to be a reasonable offer and acceptance of the proposal of the Purchaser is hereby ratified and confirmed. The Executive Director is directed to retain the deposit of the Purchaser and to forthwith return to the bidders any good faith checks or drafts. 2. (a) Terms of Bonds; Original Issue Date; Denominations; Maturities; Term Bond Options. The Bonds shall be dated February 12, 2013, as the date of original issue, shall be issued forthwith on or after such date in fully registered form, shall be numbered from R-1 upward in the denomination of $5,000 each or in any integral multiple thereof of a single maturity and shall mature on February 1 in the years and amounts as follows: Year Amount Year Amount 2018 $505,000 2026 $605,000 2019 515,000 2027 615,000 2020 525,000 2028 630,000 2021 540,000 2029 650,000 2022 550,000 2030 675,000 2023 565,000 2031 690,000 2024 575,000 2032 715,000 2025 590,000 2033 740,000 3. Terms of Bonds. (a) Title; Original Issue Date; Denominations. The Bonds shall be titled "General Obligation Refunding Bonds, Series 2013A", shall be dated as of their date of original issuance and shall be issued forthwith on or after such date as fully registered bonds. The Bonds shall be numbered from R-1 upward in the denomination of $5,000 each or in any integral multiple thereof of a single maturity. (b) Acceptance of Offer. The Board of Commissioners hereto formed a pricing committee (the "Pricing Committee") to consider proposals, award the sale of the Bonds and take any other appropriate action with respect to the Bonds and have accepted the offer of the Purchaser as set forth in a certificate of pricing committee. (c) Execution of Bond Purchase Agreement. The President and Executive Director are hereby directed to execute the Bond Purchase Agreement, in substantially the form on file with the Executive Director, but including final terms of the Bonds determined by the Pricing Committee. Execution and delivery of the final Bond Purchase Agreement shall constitute conclusive evidence of the terms of the Bonds determined by the Pricing Committee. (d) Book Entry Only System. The Depository Trust Company, a limited purpose trust company organized under the laws of the State of New York or any of its successors or its successors to its functions hereunder (the "Depository") will act as securities depository for the Bonds, and to this end: (i) The Bonds shall be initially issued and, so long as they remain in book entry form only (the "Book Entry Only Period"), shall at all times be in the form of a 2 414396v3 JSB EL185-21 separate single fully registered Bond for each maturity of the Bonds; and for purposes of complying with this requirement under Sections 6 (with respect to redemption) and 11 (with respect to registration, transfer and exchange) Authorized Denominations for any Bond shall be deemed to be limited during the Book Entry Only Period to the outstanding principal amount of that Bond. (ii) Upon initial issuance, ownership of the Bonds shall be registered in a bond register maintained by the Bond Registrar in the name of CEDE & CO., as the nominee (it or any nominee of the existing or a successor Depository, the "Nominee"). (iii) With respect to the Bonds neither the Authority nor the Bond Registrar shall have any responsibility or obligation to any broker, dealer, bank, or any other financial institution for which the Depository holds Bonds as securities depository (the "Participant") or the person for which a Participant holds an interest in the Bonds shown on the books and records of the Participant (the `Beneficial Owner"). Without limiting the immediately preceding sentence, neither the Authority, nor the Bond Registrar, shall have any such responsibility or obligation with respect to (A) the accuracy of the records of the Depository, the Nominee or any Participant with respect to any ownership interest in the Bonds, or (B) the delivery to any Participant, any Owner or any other person, other than the Depository, of any notice with respect to the Bonds, including any notice of redemption, or (C) the payment to any Participant, any Beneficial Owner or any other person, other than the Depository, of any amount with respect to the principal of or premium, if any, or interest on the Bonds, or (D) the consent given or other action taken by the Depository as the Registered Holder of any Bonds (the "Holder"). For purposes of securing the vote or consent of any Holder under this Resolution, the Authority may, however, rely upon an omnibus proxy under which the Depository assigns its consenting or voting rights to certain Participants to whose accounts the Bonds are credited on the record date identified in a listing attached to the omnibus proxy. (iv) The Authority and the Bond Registrar may treat as and deem the Depository to be the absolute owner of the Bonds for the purpose of payment of the principal of and premium, if any, and interest on the Bonds, for the purpose of giving notices of redemption and other matters with respect to the Bonds, for the purpose of obtaining any consent or other action to be taken by Holders for the purpose of registering transfers with respect to such Bonds, and for all purposes whatsoever. The Bond Registrar, as paying agent hereunder, shall pay all principal of and premium, if any, and interest on the Bonds only to the Holder or the Holders of the Bonds as shown on the bond register, and all such payments shall be valid and effective to fully satisfy and discharge the Authority's obligations with respect to the principal of and premium, if any, and interest on the Bonds to the extent of the sum or sums so paid. (v) Upon delivery by the Depository to the Bond Registrar of written notice to the effect that the Depository has determined to substitute a new Nominee in place of the existing Nominee, and subject to the transfer provisions in Section 11 (with respect to registration, transfer and exchange) references to the Nominee hereunder shall refer to such new Nominee. 3 414396v3 JSB EL185-21 (vi) So long as any Bond is registered in the name of a Nominee, all payments with respect to the principal of and premium, if any, and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, by the Bond Registrar or Authority, as the case may be, to the Depository as provided in the Letter of Representations to the Depository required by the Depository as a condition to its acting as book-entry Depository for the Bonds (said Letter of Representations, together with any replacement thereof or amendment or substitute thereto, including any standard procedures or policies referenced therein or applicable thereto respecting the procedures and other matters relating to the Depository's role as book-entry Depository for the Bonds, collectively hereinafter referred to as the"Letter of Representations"). (vii) All transfers of beneficial ownership interests in each Bond issued in book-entry form shall be limited in principal amount to Authorized Denominations and shall be effected by procedures by the Depository with the Participants for recording and transferring the ownership of beneficial interests in such Bonds. (viii) In connection with any notice or other communication to be provided to the Holders pursuant to this Resolution by the Authority or Bond Registrar with respect to any consent or other action to be taken by Holders, the Depository shall consider the date of receipt of notice requesting such consent or other action as the record date for such consent or other action; provided, that the Authority or the Bond Registrar may establish a special record date for such consent or other action. The Authority or the Bond Registrar shall, to the extent possible, give the Depository notice of such special record date not less than fifteen calendar days in advance of such special record date. (ix) Any successor Bond Registrar in its written acceptance of its duties under this Resolution and any paying agency/bond registrar agreement, shall agree to take any actions necessary from time to time to comply with the requirements of the Letter of Representations. (x) In the case of a partial prepayment of a Bond, the Holder may, in lieu of surrendering the Bonds for a Bond of a lesser denomination as provided in Section 6 (with respect to redemption), make a notation of the reduction in principal amount on the panel provided on the Bond stating the amount so redeemed. (e) Termination of Book-Entry Only System. Discontinuance of a particular Depository's services and termination of the book-entry only system may be effected as follows: (i) The Depository may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice to the Authority and discharging its responsibilities with respect thereto under applicable law. The Authority may terminate the services of the Depository with respect to the Bonds if it determines that the Depository is no longer able to carry out its functions as securities depository or the continuation of the system of book-entry transfers through the Depository is not in the best interests of the Authority or the Beneficial Owners. 4 414396v3 JSB EL185-21 (ii) Upon termination of the services of the Depository as provided in the preceding paragraph, and if no substitute securities depository willing to undertake the functions of the Depository hereunder can be found which, in the opinion of the Authority, is willing and able to assume such functions upon reasonable or customary terms, or if the Authority determines that it is in the best interests of the Authority or the Beneficial Owners of the Bonds that the Beneficial Owners be able to obtain certificates for the Bonds, the Bonds shall no longer be registered as being registered in the bond register in the name of the Nominee, but may be registered in whatever name or names the Holder of the Bonds shall designate at that time, in accordance with Section 11 hereof (with respect to registration, transfer and exchange). To the extent that the Beneficial Owners are designated as the transferee by the Holders, in accordance with Section 11 (with respect to registration, transfer and exchange), the Bonds will be delivered to the Beneficial Owners. (iii) Nothing in this subparagraph (c) shall limit or restrict the provisions of Section 11 (with respect to registration,transfer and exchange). (f) Letter of Representations. The provisions in the Letter of Representations are incorporated herein by reference and made a part of the resolution, and if and to the extent any such provisions are inconsistent with the other provisions of this resolution, the provisions in the Letter of Representations shall control. 4. Purpose. The Bonds shall provide funds to refund the Refunded Bonds. 5. Interest. The Bonds shall bear interest payable semiannually on February 1 and August 1 of each year commencing August 1, 2013, calculated on the basis of a 360-day year of twelve 30-day months, at the respective rates per annum set forth opposite the maturity years as follows: Maturity Interest Maturity Interest Year Rate Year Rate 2018 2.00% 2026 2.00% 2019 2.00 2027 2.25 2020 2.00 2028 2.375 2021 2.00 2029 2.50 2022 2.00 2030 2.75 2023 2.00 2031 2.75 2024 2.00 2032 3.00 2025 2.00 2033 3.00 It is hereby found, determined and declared that, in accordance with Minnesota Statutes, Section 475.67, subdivision 12, the Refunding shall result in a reduction of the present value of the dollar amount of the debt service to the Authority. The dollar amount of the present value of the debt service for the Bonds, calculated as required in Minnesota Statutes, Section 475.67, subdivision 12, shall be lower by at least 3% than the dollar amount of such present value of the debt service for the Refunded Bonds. 5 414396v3 JSB EL185-21 6. Optional Redemption. All Bonds of this issue maturing on or after February 1, 2024 shall be subject to redemption and prepayment at the option of the Authority on February 1, 2023, and on any date thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the maturities and the principal amounts within each maturity to be redeemed shall be determined by the Authority; and if only part of the Bonds having a common maturity date are called for prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest shall cease to accrue from and after the redemption date. Mailed notice of redemption shall be given to the paying agent and to each affected registered holder of the Bonds. To effect a partial redemption of Bonds having a common maturity date, the Bond Registrar prior to giving notice of redemption shall assign to each Bond having a common maturity date a distinctive number for each $5,000 of the principal amount of such Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers so assigned to such Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of each such Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the Authority or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the Authority and Bond Registrar duly executed by the holder thereof or his, her or its attorney duly authorized in writing) and the Authority shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the holder of such Bond, without service charge, a new Bond or Bonds of the same series having the same stated maturity and interest rate and of any Authorized Denomination or Denominations, as requested by such holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. 7. Bond Registrar. U.S. Bank National Association, in St. Paul, Minnesota, is appointed to act as bond registrar and transfer agent with respect to the Bonds (the "Bond Registrar"), and shall do so unless and until a successor Bond Registrar is duly appointed, all pursuant to any contract the Authority and Bond Registrar shall execute which is consistent herewith. The Bond Registrar shall also serve as paying agent unless and until a successor paying agent is duly appointed. Principal and interest on the Bonds shall be paid to the registered holders (or record holders) of the Bonds in the manner set forth in the form of Bond and Section 13. 8. Form of Bond. The Bonds, together with the Bond Registrar's Certificate of Authentication, the form of Assignment and the registration information thereon, shall be in substantially the following form: 6 414396v3 JSB EL185-21 UNITED STATES OF AMERICA STATE OF MINNESOTA SHERBURNE COUNTY ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF ELK RIVER R- $ GENERAL OBLIGATION REFUNDING BOND, SERIES 2013A Interest Rate Maturity Date Date Of Original Issue CUSIP February 1, 20 February 12, 2013 287417 B_ REGISTERED OWNER: CEDE & CO. PRINCIPAL AMOUNT: The Economic Development Authority for the City of Elk River, Sherburne County, Minnesota (the "Issuer"), certifies that it is indebted and for value received promises to pay to the registered owner specified above, or registered assigns, in the manner hereinafter set forth, the principal amount specified above, on the maturity date specified above, unless called for earlier redemption, and to pay interest thereon semiannually on February 1 and August 1 of each year (each, an "Interest Payment Date"), commencing August 1, 2013, at the rate per annum specified above (calculated on the basis of a 360-day year of twelve 30-day months) until the principal sum is paid or has been provided for. This Bond will bear interest from the most recent Interest Payment Date to which interest has been paid or, if no interest has been paid, from the date of original issue hereof. The principal of and premium, if any, on this Bond are payable upon presentation and surrender hereof at the office of U.S. Bank National Association in St. Paul, Minnesota (the "Bond Registrar"), acting as paying agent, or any successor paying agent duly appointed by the Issuer. Interest on this Bond will be paid on each Interest Payment Date by check or draft mailed to the person in whose name this Bond is registered (the "Holder" or "Bondholder") on the registration books of the Issuer maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth day of the calendar month next preceding such Interest Payment Date (the "Regular Record Date"). Any interest not so timely paid shall cease to be payable to the person who is the Holder hereof as of the Regular Record Date, and shall be payable to the person who is the Holder hereof at the close of business on a date (the "Special Record Date") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given to Bondholders not less than ten days prior to the Special Record Date. The principal of and premium, if any, and interest on this Bond are payable in lawful money of the United States of America. So long as this Bond is registered in the name of the Depository or its Nominee as provided in the Resolution hereinafter described and as those terms are defined therein, payment of principal of and interest on this Bond and notice with respect thereto shall be made as provided in the Letter of Representations, as defined in the Resolution. Bonds may only be registered in the name of the Depository or its Nominee. 7 414396v3 JSB EL185-21 This Bond shall not be valid or become obligatory for any purpose or be entitled to any security unless the Certificate of Authentication hereon shall have been executed by the Bond Registrar. Optional Redemption. All Bonds of this issue maturing on or after February 1, 2024, both inclusive, are subject to redemption and prepayment at the option of the Issuer on February 1, 2023, and on any date thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the maturities and the principal amounts within each maturity to be redeemed shall be determined by the Issuer; and if only part of the Bonds having a common maturity date are called for prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of redemption shall be given to the paying agent and to each affected Holder of the Bonds. Selection of Bonds for Redemption; Partial Redemption. To effect a partial redemption of Bonds having a common maturity date, the Bond Registrar shall assign to each Bond having a common maturity date, a distinctive number for each $5,000 of the principal amount of such Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers assigned to the Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of such Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the Issuer or the Bond Registrar so requires, a written instrument of transfer in form satisfactory to the Issuer and the Bond Registrar duly executed by the Holder thereof or his, her or its attorney duly authorized in writing) and the Issuer shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the Holder of such Bond, without service charge, a new Bond or Bonds of the same series having the same stated maturity and interest rate and of any Authorized Denomination or Denominations, as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. Issuance; Purpose; General Obligation. This Bond is one of an issue in the total principal amount of$9,685,000, all of like date of original issue and tenor, except as to number, maturity, interest rate, denomination and redemption privilege, issued pursuant to and in full conformity with the Constitution and laws of the State of Minnesota and pursuant to a resolution adopted by the Board of Commissioners on February 4, 2013 (the "Resolution"), for the purpose of providing funds to refund in advance of maturity and at their redemption date the 2018 to 2033 maturities of the Authority's General Obligation Bonds, Series 2007B, dated November 8, 2007 (the "Refunded Bonds"), of which $9,225,000 in principal amount is callable on February 1, 2017. This Bond is payable out of the General Obligation Refunding Bonds, Series 2013A Fund of the Issuer. This Bond constitutes a general obligation of the Issuer, and to provide moneys for the prompt and full payment of its principal, premium, if any, and interest when the same become due, the full faith and credit and taxing powers of the City of Elk River, Minnesota, have 8 414396v3 JSB EL185-21 been and are hereby irrevocably pledged pursuant to Ordinance No. 12-19, adopted by the City Council of the City of Elk River, Minnesota, on December 10, 2012. Denominations; Exchange; Resolution. The Bonds are issuable solely in fully registered form in the denominations of$5,000 and integral multiples thereof of a single maturity and are exchangeable for fully registered Bonds of other authorized denominations in equal aggregate principal amounts at the principal office of the Bond Registrar, but only in the manner and subject to the limitations provided in the Resolution. Reference is hereby made to the Resolution for a description of the rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal office of the Bond Registrar. Transfer. This Bond is transferable by the Holder in person or by the Holder's attorney duly authorized in writing at the principal office of the Bond Registrar upon presentation and surrender hereof to the Bond Registrar, all subject to the terms and conditions provided in the Resolution and to reasonable regulations of the Issuer contained in any agreement with the Bond Registrar. Thereupon the Issuer shall execute and the Bond Registrar shall authenticate and deliver, in exchange for this Bond, one or more new fully registered Bonds in the name of the transferee (but not registered in blank or to "bearer" or similar designation), of an authorized denomination or denominations, in aggregate principal amount equal to the principal amount of this Bond, of the same maturity and bearing interest at the same rate. Fees upon Transfer or Loss. The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Bond and any legal or unusual costs regarding transfers and lost Bonds. Treatment of Registered Owners. The Issuer and Bond Registrar may treat the person in whose name this Bond is registered as the owner hereof for the purpose of receiving payment as herein provided (except as otherwise provided herein with respect to the Record Date) and for all other purposes, whether or not this Bond shall be overdue, and neither the Issuer nor the Bond Registrar shall be affected by notice to the contrary. Qualified Tax-Exempt Obligations. This Bond has been designated by the Issuer as a "qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to happen and to be performed, precedent to and in the issuance of this Bond, have been done, have happened and have been performed, in regular and due form, time and manner as required by law, and that this Bond, together with all other debts of the Issuer outstanding on the date of original issue hereof and the date of its issuance and delivery to the original purchaser, does not exceed any constitutional or statutory limitation of indebtedness. IN WITNESS WHEREOF, the Economic Development Authority for the City of Elk River, Sherburne County, Minnesota, by its Board of Commissioners has caused this Bond to be executed on its behalf by the facsimile signatures of its President and Executive Director, the corporate seal of the Issuer having been intentionally omitted as permitted by law. 9 414396v3 JSB EL185-21 Date of Registration: Registrable by: U.S. BANK NATIONAL ASSOCIATION February 12, 2013 Payable at: U.S. BANK NATIONAL BOND REGISTRAR'S ASSOCIATION CERTIFICATE OF AUTHENTICATION ECONOMIC DEVELOPMENT AUTHORITY This Bond is one of the FOR THE CITY OF ELK RIVER Bonds described in the SHERBURNE COUNTY, MINNESOTA Resolution mentioned within. U.S. Bank National Association, /s/Facsimile as Bond Registrar President By Authorized Signature /s/Facsimile Executive Director 10 414396v3 JSB EL185-21 ABBREVIATIONS 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 applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UTMA - as custodian for under the (Cust) (Minor) (State) Uniform Transfers to Minors Act Additional abbreviations may also be used though not in the above list. ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto the within Bond and does hereby irrevocably constitute and appoint attorney to transfer the Bond on the books kept for the registration thereof, 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 any change whatever. Signature Guaranteed: Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm having a membership in one of the major stock exchanges. The Bond Registrar will not effect transfer of this Bond unless the information concerning the transferee requested below is provided. Name and Address: (Include information for all joint owners if the Bond is held by joint account.) 11 414396v3 JSB EL185-21 9. Execution; Temporary Bonds. The Bonds shall be in typewritten form, shall be executed on behalf of the Authority by the signatures of its President and Executive Director and be sealed with the seal of the Authority; provided, as permitted by law, both signatures may be photocopied facsimiles and the corporate seal has been omitted. In the event of disability or resignation or other absence of either officer, the Bonds may be signed by the manual or facsimile signature of the officer who may act on behalf of the absent or disabled officer. In case either officer whose signature or facsimile of whose signature shall appear on the Bonds shall cease to be such officer before the delivery of the Bonds, the signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in office until delivery. 10. Authentication. No Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit under this resolution unless a Certificate of Authentication on the Bond, substantially in the form hereinabove set forth, shall have been duly executed by an authorized representative of the Bond Registrar. Certificates of Authentication on different Bonds need not be signed by the same person. The Bond Registrar shall authenticate the signatures of officers of the Authority on each Bond by execution of the Certificate of Authentication on the Bond and by inserting as the date of registration in the space provided the date on which the Bond is authenticated, except that for purposes of delivering the original Bonds to the Purchaser, the Bond Registrar shall insert as a date of registration the date of original issue of February 12, 2013. The Certificate of Authentication so executed on each Bond shall be conclusive evidence that it has been authenticated and delivered under this resolution. 11. Registration; Transfer; Exchange. The Authority will cause to be kept at the principal office of the Bond Registrar a bond register in which, subject to such reasonable regulations as the Bond Registrar may prescribe, the Bond Registrar shall provide for the registration of Bonds and the registration of transfers of Bonds entitled to be registered or transferred as herein provided. Upon surrender for transfer of any Bond at the principal office of the Bond Registrar, the Authority shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration (as provided in Section 10 with respect to authentication) of, and deliver, in the name of the designated transferee or transferees, one or more new Bonds of any authorized denomination or denominations of a like aggregate principal amount, having the same stated maturity and interest rate, as requested by the transferor; provided, however, that no Bond may be registered in blank or in the name of"bearer" or similar designation. At the option of the Holder, Bonds may be exchanged for Bonds of any authorized denomination or denominations of a like aggregate principal amount and stated maturity, upon surrender of the Bonds to be exchanged at the principal office of the Bond Registrar. Whenever any Bonds are so surrendered for exchange, the Authority shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the holder making the exchange is entitled to receive. 12 414396v3 JSB EL185-21 All Bonds surrendered upon any exchange or transfer provided for in this resolution shall be promptly cancelled by the Bond Registrar and thereafter disposed of as directed by the Authority. All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general obligations of the Authority evidencing the same debt, and entitled to the same benefits under this resolution, as the Bonds surrendered for such exchange or transfer. Every Bond presented or surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, in form satisfactory to the Bond Registrar, duly executed by the holder thereof or the Holder's attorney duly authorized in writing. The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of any Bond and any legal or unusual costs regarding transfers and lost Bonds. Transfers shall also be subject to reasonable regulations of the Authority contained in any agreement with the Bond Registrar, including regulations which permit the Bond Registrar to close its transfer books between record dates and payment dates. 12. Rights Upon Transfer or Exchange. Each Bond delivered upon transfer of or in exchange for or in lieu of any other Bond shall carry all the rights to interest accrued and unpaid, and to accrue, which were carried by such other Bond. 13. Interest Payment; Record Date. Interest on any Bond shall be paid on each Interest Payment Date by check or draft mailed to the person in whose name the Bond is registered (the "Holder") on the registration books of the Authority maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth day of the calendar month next preceding such Interest Payment Date (the "Regular Record Date"). Any such interest not so timely paid shall cease to be payable to the person who is the Holder thereof as of the Regular Record Date, and shall be payable to the person who is the Holder thereof at the close of business on a date (the "Special Record Date") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given by the Bond Registrar to the Holders not less than ten days prior to the Special Record Date. 14. Treatment of Registered Owner. The Authority and Bond Registrar may treat the person in whose name any Bond is registered as the owner of such Bond for the purpose of receiving payment of principal of and premium, if any, and interest (subject to the payment provisions in Section 13 with respect to interest payment and record date) on, such Bond and for all other purposes whatsoever whether or not such Bond shall be overdue, and neither the Authority nor the Bond Registrar shall be affected by notice to the contrary. 15. Delivery; Application of Proceeds. The Bonds when so prepared and executed shall be delivered by the Treasurer to the Purchaser upon receipt of the purchase price, and the Purchaser shall not be obliged to see to the proper application thereof. 13 414396v3 JSB EL185-21 16. Fund and Accounts. There is hereby created a special fund to be designated the "General Obligation Bonds, Series 2013A Fund" (the "Fund") to be administered and maintained by the Treasurer as a bookkeeping account separate and apart from all other funds maintained in the official financial records of the Authority. The Fund shall be maintained in the manner herein specified until all of the Bonds and the interest thereon have been fully paid. There shall be maintained in the Fund the following separate accounts: (i) Escrow Account. The Escrow Account will be maintained as an Escrow Account (the "Escrow Account") with U.S. Bank National Association in St. Paul, Minnesota, which is a suitable financial institution within the State, whose deposits are insured by the Federal Deposit Insurance Corporation, whose combined capital and surplus is not less than $500,000 and said financial institution is hereby designated escrow agent (the "Escrow Agent") for the Escrow Account. All proceeds of the sale of the Bonds will be received by the Escrow Agent and applied to fund the Escrow Account or used to pay costs of issuance. Proceeds of the Bonds not used to pay costs of issuance or fund the Escrow Account will be returned to the City for deposit into the Debt Service Account. All investment earnings on the Escrow Account are hereby irrevocably pledged and appropriated thereto. The Escrow Account will be invested in securities maturing or callable at the option of the holder on such dates and bearing interest at such rates as will be required to provide sufficient funds, together with any cash or other funds retained in the Escrow Account, (i) to pay when due the interest to accrue on each Bond to and including February 1, 2017 (the"Redemption Date"), and (ii) to pay on the Redemption Date the principal amount of each of the Refunded Bonds; and such amounts will be paid from the Escrow Account. The Escrow Account will be irrevocably appropriated to the payment of the principal of and interest on the Bonds until the proceeds of the Bonds therein are applied to prepayment of the Refunded Bonds. The moneys in the Escrow Account will be used solely for the purposes herein set forth and for no other purpose, except that any surplus in the Escrow Account may be remitted to the Authority, all in accordance with the Escrow Agreement (hereafter defined) by and between the Authority and the Escrow Agent. Any moneys remitted to the Authority upon termination of the Escrow Agreement will be deposited in the Debt Service Account. (ii) Debt Service Account. There are hereby irrevocably appropriated and pledged to, and there shall be credited to, the Debt Service Account: (a) any balance remitted to the Authority upon funding the Escrow Account and paying costs of issuance; (b) any balance remitted to the Authority upon the termination of the Escrow Agreement; (c) any balance remaining on February 2, 2017,in the debt service account created under the Authority resolution authorizing the issuance and sale of the Refunded Bonds (the"Prior Resolution"); (d) any collections of all taxes herein levied for the payment of the Bonds and interest thereon; (e) any funds made available to the Authority from the City; (f) all investment earnings on funds held in the Debt Service Account; and (g) any and all other moneys, which are properly available and are appropriated by the governing body of the Authority to the Debt Service Account. The amount of any surplus remaining in the Debt Service Account when the Bonds and interest thereon are paid will be used as provided in Section 475.61, Subdivision 4 of the Act. 14 414396v3 JSB EL185-21 17. Findings. It is hereby found and determined that based upon information presently available from the Authority's financial advisers, the issuance of the Bonds will result in a reduction of debt service cost to the Authority on the Refunded Bonds, such that the present value of such debt service or interest cost savings (the"Reduction") is at least 3.00% of the debt service on the Refunded Bonds. The Reduction, after the inclusion of all authorized expenses of refunding in the computation of the effective interest rate on the Bonds, is adequate to authorize the issuance of the Bonds as provided by Minnesota Statutes, Section 475.67, Subdivisions 12 and 13. 18. Investment of Funds. Moneys in the Debt Service Account will be used solely to pay the principal of and interest on the Bonds or any other bonds hereafter issued and made payable from the Fund. No portion of the proceeds of the Bonds will be used directly or indirectly to acquire higher yielding investments or to replace funds which were used directly or indirectly to acquire higher yielding investments, except (i) for a reasonable temporary period until such proceeds are needed for the purpose for which the Bonds were issued, and (ii) in addition to the above, in an amount not greater than the lesser of 5% of the proceeds of the Bonds or $100,000. To this effect, any proceeds of the Bonds and any sums from time to time held in the Fund (or any other Authority account which will be used to pay principal and interest to become due on the Bonds) in excess of amounts which under the applicable federal arbitrage regulations may be invested without regard as to yield will not be invested at a yield in excess of the applicable yield restrictions imposed by the arbitrage regulations on such investments after taking into account any applicable temporary periods or minor portion made available under the federal arbitrage regulations. In addition, the proceeds of the Bonds and money in the Fund will not be invested in obligations or deposits issued by, guaranteed by or insured by the United States or any agency or instrumentality thereof if and to the extent that such investment would cause the Bonds to be federally guaranteed within the meaning of Section 149(b) of the Internal Revenue Code of 1986, as amended (the"Code"). 19. General Obligation Pledge. For the prompt and full payment of the principal and interest on the Bonds, as the same respectively become due, the full faith, credit and taxing powers of the City will be and are hereby irrevocably pledged. If the balance in the Escrow Account or Debt Service Account is ever insufficient to pay all principal and interest then due on the Bonds and any other bonds payable therefrom, the deficiency will be promptly paid out of monies in the general fund of the Authority which are available for such purpose, and such general fund may be reimbursed with or without interest from the Escrow Account or Debt Service Account when a sufficient balance is available therein. To the extent that it shall ever be necessary to provide full and timely payment of the debt service on the Bonds, the Authority shall, pursuant to the authority therefore described in this Section, levy an ad valorem tax on all taxable property within the City sufficient for such purposes. 20. Pledge of Tax Levy. To provide moneys for payment of an interest on the Bonds there is hereby levied upon all taxable property in the City a direct annual irrepealable ad valorem tax (the "Taxes") upon all of the taxable property in the City, which will be spread upon the tax rolls and collected with and as part of other general taxes of the City. The taxes will be credited to the Debt Service Fund above provided and will be in the years and amounts as follows (year stated being year of collection): 15 414396v3 JSB EL185-21 Year Levy (See EXHIBIT A) 21. Cancellation of Prior Levy. It is hereby determined that upon the deposit of moneys in the Escrow Account that an irrevocable appropriation to the debt service fund for the Refunded Bonds maturing after the Redemption Date will have been made within the meaning of Section 475.61, subdivision 3 of the Act and the Executive Director of the Authority is hereby authorized and directed to certify such fact to and request the County Auditor of Sherburne County to cancel any and all tax levies for taxes payable in 2018 and thereafter made by the resolution authorizing the issuance of the Refunded Bonds. The tax levies are such that if collected in full they, together with and any other revenues herein pledged for the payment of the Bonds, will produce at least 5% in excess of the amount needed to meet when due the principal and interest payments on the Bonds. The tax levies shall be irrepealable so long as any of the Bonds are outstanding and unpaid, provided that the City reserves the right and power to reduce the levies in the manner and to the extent permitted by Minnesota Statutes, Section 475.61, Subdivision 3. 22. Certificate of Registration and Tax Levy. The Executive Director is hereby directed to file a certified copy of this resolution with the County Auditor of Sherburne County, Minnesota, together with such other information as the County Auditor shall require, and to obtain the County Auditor's certificate that the Bonds have been entered in the County Auditor's Bond Register, and that the tax levy required by law has been made. 23. Deposit of Funds. As of the date of delivery of and payment for the Bonds, proceeds of the Bonds, plus accrued interest on the Bonds, less necessary expenses of the issuance of the Bonds (the"Proceeds"), are hereby pledged and appropriated and will be deposited in the Escrow Account. Proceeds of the Bonds in excess of the amount needed to fund the Escrow Account and pay costs of issuance are appropriated to the Debt Service Account in accordance with Section 16(ii). 24. Payment of Bonds and Refunded Bonds. It is hereby found and determined that money available and appropriated to the Escrow Account will be sufficient, together with the permitted earnings on the investment of the Escrow Account, to pay principal of and interest on the Bonds through the Redemption Date, and to pay at maturity or redemption all of the principal of and redemption premium (if any) on the Refunded Bonds maturing after the Redemption Date. 25. Permitted Investments. Securities purchased from the monies in the Escrow Account will be limited to securities specified in Section 475.67, Subdivision 8 of the Act. The Escrow Agent, as agent for the Authority is hereby authorized and directed to purchase for and on behalf of the Authority and in its name, appropriate securities to fund the Escrow Account. Upon the issuance and delivery of the Bonds, the securities so purchased will be deposited with the Escrow Agent and held pursuant to the terms of the Escrow Agreement and the Resolution. 16 414396v3 JSB ELI85-21 26. Notice of Redemption. The Refunded Bonds maturing on February 1, 2017 and thereafter will be redeemed and prepaid on the Redemption Date. The Refunded Bonds will be redeemed and prepaid in accordance with their terms and in accordance with the terms and conditions set forth in the form of Notice of Call for Redemption attached to the Escrow Agreement (defined below) as Exhibit C which terms and conditions are hereby approved and incorporated herein by reference. The Registrar for the Refunded Bonds is authorized and directed to send a copy of the Notice of Redemption to the registered holder of the Refunded Bonds. 27. Escrow Agreement. On or prior to the delivery of the Refunding Bonds, the Chair and Executive Director are hereby authorized and directed to execute on behalf of the Authority an escrow agreement (the"Escrow Agreement") with the Escrow Agent in substantially the form now on file with the Executive Director. All essential terms and conditions of the Escrow Agreement including payment by the Authority of reasonable charges for the services of the Escrow Agent, are hereby approved and adopted and made a part of this resolution, and the Authority covenants that it will promptly enforce all provisions thereof in the event of default thereunder by the Escrow Agent. 28. Records and Certificates. The officers of the Authority are hereby authorized and directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality of the issuance of the Bonds, certified copies of all proceedings and records of the Authority relating to the Bonds and to the financial condition and affairs of the Authority, and such other affidavits, certificates and information as are required to show the facts relating to the legality and marketability of the Bonds as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates and affidavits, including any heretofore furnished, shall be deemed representations of the Authority as to the facts recited therein. 29. Tax-Exempt Status of the Bonds; Rebate. The Authority covenants and agrees with the holders 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 action which would cause the interest on the Bonds to become subject to taxation under the Internal Revenue Code of 1986, as amended (the "Code"), and the Treasury Regulations promulgated thereunder, in effect at the time of such actions, and that it will take or cause its officers, employees or agents to take, all affirmative action within its power that may be necessary to ensure that such interest will not become subject to taxation under the Code and applicable Treasury Regulations, as presently existing or as hereafter amended and made applicable to the Bonds. To that end, the Authority will comply with all requirements necessary under the Code to establish and maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the Code, including without limitation requirements relating to temporary periods for investments, limitations on amounts invested at a yield greater than the yield on the Bonds, and the rebate of excess investment earnings to the United States (unless the Authority qualifies for any exemption from rebate requirements based on timely expenditure of proceeds of the Bonds, in accordance with the Code and applicable Treasury Regulations). 17 414396v3 JSB EL185-21 30. Designation of Qualified Tax-Exempt Obligations. In order to qualify the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Code, the Authority hereby makes the following factual statements and representations: (a) the Bonds are issued after August 7, 1986; (b) the Bonds are not"private activity bonds" as defined in Section 141 of the Code; (c) the Authority hereby designates the Bonds as "qualified tax exempt obligations" for purposes of Section 265(b)(3) of the Code; (d) the reasonably anticipated amount of tax exempt obligations (other than private activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will be issued by the Authority (and all entities treated as one issuer with the Authority, and all subordinate entities whose obligations are treated as issued by the Authority) during this calendar year 2013 will not exceed $10,000,000; (e) not more than $10,000,000 of obligations issued by the Authority during this calendar year 2013 have been designated for purposes of Section 265(b)(3) of the Code; and (f) the Bonds are not issued as part of an issue the aggregate face amount of which exceeds $10,000,000. The Authority shall use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designation made by this Section. 31. Tax Covenants. In order to ensure that the interest on the Bonds shall at all times be excluded from federal gross income, the Authority specifically represents, warrants and covenants with all holders of the Bonds, as follows: (a) It will fulfill all conditions specified in Sections 103 and 141 through 150 of the Code and applicable Treasury Regulations as necessary to maintain the tax exempt status of the interest borne by the Bonds. (b) The Project, including any property financed or otherwise provided for by the net proceeds of the Bonds, will be owned by the Authority and used by the general public or organizations described in Section 501(c)(3) of the Code. (c) Less than 5% of the net proceeds of the Bonds will be used to provide property used either (i) by an organization described in Section 501(c)(3) of the Code in an activity that constitutes an unrelated trade or business, or (ii) in a trade or business by a person other than an organization described in Section 501(c)(3) of the Code or a governmental unit (within the meaning of Section 141 of the Code). (d) It shall make no use of the Project, including but not limited to entering into any agreement for the management of the Project or any similar agreement, the effect of which would cause the Bonds not to constitute "qualified 501(c)(3) bonds," within the meaning of Section 145 and related Sections of the Code, and any service contract to be entered into with 18 414396v3 JSB EL185-21 respect to the Project (unless entered into with an organization described in Section 501(c)(3) of the Code) shall constitute a "qualified management agreement" within the meaning of all pertinent provisions of law, including all relevant provisions of the Code and regulations, rulings and revenue procedures thereunder, including Revenue Procedure 97-13 and any modifications thereto. (e) Not more than 2% of the proceeds of the Bonds will be applied to the payment of costs of issuance of the Bonds and all costs of issuance in excess of that amount will be paid by the Authority from funds other than proceeds of the Bonds. (f) It has not leased, sold, assigned, granted or conveyed and will not lease, sell, assign, grant or convey all or any portion of the Project or any interest therein to the United States or any agency or instrumentality thereof within the meaning of Section 149(b) of the Code. (g) No portion of the proceeds of the Bonds will be used to provide any of the following facilities or facilities related or incidental thereto: any airplane, skybox or other private luxury box, facility used primarily for gambling, or store the principal business of which is the sale of alcoholic beverages for consumption off premises. (h) As of the date hereof, the Authority and YMCA of the Greater Twin Cities (the "YMCA") are the only "principal users" of the Project and it will not permit any person to become a "principal user" of the Project if such action would cause the interest on the Bonds to become includable in federal gross income in the hands of the Bondholders. (i) The average maturity of the Bonds does not exceed 120% of the average reasonably expected economic life of the Project as determined in accordance with Section 147(b) of the Code. (j) No obligations have been or will be issued which are described in Section 141, 142, 143, 144 or 145 of the Code and that are (i) sold at substantially the same time as the Bonds, (ii) sold pursuant to a common plan of marketing and (iii) payable in whole or in part by the YMCA or otherwise have any common or pooled security for the payment of debt service thereon with the Bonds. (k) It will not use the proceeds of the Bonds in such a manner as to cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code and applicable Treasury Regulations. (1) It reasonably expects that 85% of the spendable proceeds of the Bonds will be used to carry out the governmental purpose of the Bonds within 3 years of the date the Bonds are issued. Not more than 50% of the proceeds of the Bonds will be invested in nonpurpose investments (as defined in Section 148(f)(6)(A) of the Code) having a substantially guaranteed yield for 4 years or more. (m) It will comply with and fulfill all other requirements and conditions of the Code and Treasury Regulations and rulings issued pursuant thereto relating to the acquisition, 19 414396v3 JSB EL185-21 construction and operation of the Project to the end that interest on the Bonds shall at all times be excludable from federal gross income. (n) It will not use the proceeds of the Bonds in such a manner as to cause the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code and applicable Treasury Regulations; and to this end, the Authority shall pay to the United States, as a rebate, an amount equal to the sum of (i) the excess of (I) the aggregate amount earned on all nonpurpose obligations (other than investments attributable to an excess described in this clause), over (II) the amount which would have been earned if all nonpurpose obligations were invested at a rate equal to the yield on the Bonds plus (ii) any income attributable to the excess described in clause (i), at the times and in the amounts required by Section 148 of the Code, all within the meaning of Section 148 of the Code. The Authority shall maintain records of the interest rate borne by the Bonds and the investments of the Escrow Account and Debt Service Account and earnings thereon in adequate detail to enable the Authority to calculate the amount of any rebate required to be made to the United States. The Authority shall pay the rebate to the United States at times and in installments which satisfy Section 148 of the Code and the Treasury Regulations, at least once every 5 years and within 60 days after the day on which the last of the Bonds is redeemed. Calculations of the amount to be rebated shall be made at least every 5 years, by an independent accountant selected by the Authority. Such calculations shall be retained until 6 years after the retirement of the Bonds. The rebate shall be calculated as provided in the applicable Treasury Regulations, including taking into account the gain or loss on the disposition of nonpurpose investments. 32. Tax Exemption Agreement. The Authority will enter into a Tax Exemption Agreement, dated February 12, 2013, with the YMCA. The Tax Exemption Agreement is hereby approved and the President and Executive Director are authorized to execute the Tax Exemption Agreement on behalf of the Authority. 33. Defeasance. When all Bonds have been discharged as provided in this Section, all pledges, covenants and other rights granted by this resolution to the registered holders of the Bonds shall, to the extent permitted by law, cease. The Authority may discharge its obligations with respect to any Bonds which are due on any date by irrevocably depositing with the Bond 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 Bond Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit. The Authority 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 Bond Registrar on or before that date a sum sufficient for the payment thereof in full, provided that notice of redemption thereof has been duly given. The Authority may also at any time discharge its obligations with respect to any Bonds, subject to the provisions of law now or hereafter authorizing and regulating such action, by depositing irrevocably in escrow, with a suitable banking institution qualified by law as an escrow agent for this purpose, cash or securities described in Minnesota Statutes, Section 475.67, Subdivision 8,bearing interest payable at such times and at such rates and maturing on such dates as shall be required, subject to sale and/or reinvestment, to pay all amounts to become due thereon to maturity or, if notice of redemption as herein required has been duly provided for, to such earlier redemption date. 20 414396v3 JSB EL185-21 34. Continuing Disclosure. The Authority is the issuer of the Bonds. However it is not an "obligated person" subject to the disclosure requirements under the SEC Rule 15c2- 12(b)(5) (the "Rule") because (i) the bonds are general obligations of the City and not the Authority and (ii) financial information and operating data set forth in the Official Statement relates only to the City. Pursuant to the Ordinance, the City has authorized entering into a Continuing Disclosure Undertaking. 35. Severability. If any section, paragraph or provision of this resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this resolution. 36. Headings. Headings in this resolution are included for convenience of reference only and are not a part hereof, and shall not limit or define the meaning of any provision hereof. 37. Effectiveness. This resolution shall become effective immediately as the City Council has previously adopted the Ordinance which authorized the pledge of the City's full faith and credit to the payment of the Bonds. 21 414396v3 JSB EL185-21 STATE OF MINNESOTA ) COUNTY OF SHERBURNE ) SS. ECONOMIC DEVELOPMENT AUTHORITY ) FOR THE CITY OF ELK RIVER ) I, the undersigned, being the duly qualified and acting Executive Director of the Economic Development Authority for the City of Elk River, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes of a meeting of the Board of Commissioners of said Authority, duly called and held on the date therein indicated, insofar as such minutes relate to the Authority's $9,685,000 General Obligation Refunding Bonds, Series 2013A. Dated: , 2013. Executive Director 414396v3 JSB EL185-21 EXHIBIT A TAX LEVY Year* Net Levy 2017 767,169.38 2018 767,064.38 2019 766,749.38 2020 771,474.38 2021 770,634.38 2022 774,834.38 2023 773,469.38 2024 777,144.38 2025 780,504.38 2026 778,299.38 2027 779,520.00 2028 784,809.38 2029 793,996.88 2030 790,256.25 2031 796,582.50 2032 800,310.00 * Year Collected 414396v2 JSB EL185-21 A-1 STATE OF MINNESOTA COUNTY AUDITOR'S CERTIFICATE AS TO TAX LEVY AND REGISTRATION COUNTY OF SHERBURNE AND CANCELLATION I, the undersigned, being the duly qualified and acting County Auditor of Sherburne County, Minnesota, DO HEREBY CERTIFY that on the date hereof there was filed in my office a certified copy of a resolution adopted on February 4, 2013, by the Board of Commissioners of the Economic Development Authority for the City of Elk River, Minnesota, authorizing the issuance of$9,685,000 General Obligation Refunding Bonds, Series 2013A (the "Bonds"), and levying a tax for the payment thereof, together with full information regarding the Bonds for which the tax was levied; and the Bonds have been entered in my Bond Register and the tax levy required by law has been made. I further certify that the tax levies for the General Obligation Bonds, Series 2007B have been canceled to the extent set forth in the resolution. WITNESS My hand and official seal this day of , 2013. County Auditor Sherburne County, Minnesota (SEAL) Deputy 414396v2 JSB EL185-21 YMCA OF THE GREATER TWIN CITIES BOARD OF DIRECTORS RESOLUTION WHEREAS,the Economic Development Authority for the City of Elk River(the"EDA")proposes to refund its outstanding General Obligation Bonds,Series 2007B(the"Prior Bonds"),the proceeds of which were used to finance the acquisition and betterment of a recreational facility located at 13337 Business Center Drive NW in Elk River(the"Project"),owned by the EDA and leased to YMCA of the Greater Twin Cities (formerly known as The Young Men's Christian Association of Metropolitan Minneapolis,collectively,the "YMCA")pursuant to a Lease Agreement,dated as of August 20,2007(the"Lease").The EDA believes that it is desirable and necessary that there be issued general obligation refunding bonds to refund the Prior Bonds to achieve debt service cost savings;and WHEREAS,it is proposed that the EDA will issue its General Obligation Refunding Bonds, Series 2013A, in the approximate original aggregate principal amount not to exceed$10,000,000(the"Bonds")to refund the Prior Bonds,and to pay certain costs and expense incidental to the issuance of the Bonds;and WHEREAS,pursuant to the Lease,the YMCA pays"Basic Rent"in an amount equal to one-third of the principal and interest due on the Bonds and has covenanted not to do or fail to do anything that would affect the tax-exempt status of the Bonds;and WHEREAS,it is proposed that the YMCA execute and deliver certain documents to be prepared in connection with the issuance of the Bonds, including a Tax Exemption.Agreement, dated the date of issuance of the Bonds,between the YMCA and the EDA(the"Tax Exemption Agreement");and NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF YMCA OF THE GREATER TWIN CITIES as follows: 1. The YMCA hereby consents to the issuance of the Bonds subject to the following conditions: (a)the present value of the debt service on the Bonds(computed to their stated maturity dates) shall be lower by at least 5% than the present value of the debt service on the Refunded Bonds, (b) the principal amount of the Bonds shall not exceed$10,000,000,and(c)the final maturity of the Bonds shall be no later than February 1,2033. 2. Each of the President, Executive Director, the Vice President or Secretary of the YMCA (each an"Authorized Officer"),acting singly,is hereby authorized to execute and deliver the Tax Exemption Agreement. 3. The Authorized Officers of the YMCA are hereby authorized and directed to do and perform all acts and to execute and deliver all such documents and certificates as may be necessary, advisable, or convenient and proper to carry out the intent of the foregoing provisions of this resolution and to fully comply with the requirements for using the facility fmanced with the proceeds of the Bonds and complying with the terms of the Tax Exemption Agreement. 4. All other and further actions of the members of the Board of Directors of the YMCA and all officers, agents, and employees of the YMCA that are deemed necessary or appropriate in order to consummate the transactions described in this resolution and the documents referenced above, whether heretofore or hereafter taken or done,which are consistent with the purpose and intent of this resolution,are hereby in all respects approved,authorized,ratified,and confirmed. 417029y1 JSB EL185-21 Dated: 1 Z Z ,2013 I YMCA OF THE GREATER TWIN CITIES By: ( GG Its: President '► By: - — Its: Secretary 417029v1 JSB EL185 21 S-1 STANDARD & POOR'S RATINGS SERVICES Rati RatingsDirect Summary: Elk River Economic Development Authority, Minnesota Elk River; General Obligation Primary Credit Analyst: Antionette E Maxwell,Chicago(1)312-233-7016;antionette_maxwell @standardandpoors.com Secondary Contact: Carol A Hendrickson,Chicago(1)312-233-7062;carol_hendrickson @standardandpoors.com Table Of Contents Rationale Outlook Related Criteria And Research WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JANUARY 14,2013 1 i0!)2136 ( 300126975 Summary: Elk River Economic Development Authority, Minnesota Elk River; General Obligation Credit Profile US$9,965 mil GO rfdg lends(Elk River Econ Dev Auth)ser 2013A dtd 02/12/2013 due 02/01/2033 Long Term Rating AA+/Stable New Elk River GO Long Term Rating AA+/Stable Affirmed Rationale Standard&Poor's Ratings Services assigned its'AA+'long-term rating to the Elk River Economic Development Authority,Minn.'s series 2013A general obligation(GO)refunding bonds.At the same time,Standard&Poor's affirmed its'AA+'long-term rating on the city's existing GO debt.The outlook on all bonds is stable. In our opinion,the rating reflects the city's: • Access to the deep and diverse Minneapolis-St Paul and St. Cloud, Minn.metropolitan economies; • Favorable economic indicators,reflecting strong income levels and very strong market value per capita; • Maintenance of very strong reserves,coupled with conservative and strong financial management policies that include long-range budget and capital plans;and • Moderate debt burden. Officials plan to use series 2013A bond proceeds to crossover refund the 2018-2033 maturities of the authority's series 2007 bonds for interest cost savings.The bonds will be general obligations of the city for which its full faith,credit,and taxing powers are pledged. Elk River,the seat of Sherburne County, covers 43.8 square miles approximately 30.0 miles northwest of the Minneapolis-St Paul metropolitan area and 38.0 miles southeast of St. Cloud.The city's population has increased by 40%since 2000 to a current estimate of 23,101 in 2011. Management has stated that although residents commute into the Minneapolis-St.Paul and St. Cloud metropolitan areas for employment,the city also draws commuters from surrounding communities due to the employment opportunities offered by a number of small companies.Along with access to Interstate 94,residents can also'commute into downtown Minneapolis via the city's Northstar commuter rail station. Leading city employers include: • Elk River Independent School District No. 728(1,573 employees); • Sherburne County(578); • Wal-Mart Stores Inc.(424);and • Guarding Angels of Elk River, Inc.(317). WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JANUARY 14,2013 2 1062136( 300126975 Summary:Elk River Economic Development Authority, Minnesota Elk River; General Obligation County unemployment averaged 5.4%,as of October 2012,above the state's rate of 5.2%but below the national level of 7.5%. Income levels are 130%of the nation's median household effective buying income,which we consider strong. Taxable market value increased by an 8.1%annual average between fiscals 2007 and 2009;however,from fiscals 2010 to 2012,taxable market values declined by a 5.9%average to$1.79 billion.Indicated market value,a better representation of area market prices,was$1.86 billion or$80,633 per capita,which we consider very strong. Residential properties account for 50%of the property tax base while commercial and industrial properties account for 34%.The tax base is diverse,with the 10 leading taxpayers accounting for 16%of net tax capacity.Management has stated that the city is 45%developed and given its proximity to Interstate 94,which provides quick access to the St. Cloud and Twin Cities metropolitan area,management believes it is well positioned to draw industrial and commercial businesses in to the city. The city's good financial management practices have contributed to a strong financial profile,including consistently high reserves. During the past three years,general fund reserves have ranged between 45%and 53%of expenditures, which adheres to the city's policy of maintaining an unreserved general fund balance of at least 40%of expenditures. For the fiscal year ended Dec. 31, 2012,the city's budget called for a use of$367,000 in reserves for capital and general operating purposes.However,management stated that the year will end with a small surplus,as they received better fuel prices than budgeted,more building permit revenue,as well as lower salary expenses.Similarly,for fiscal 2011, management budgeted for a$271,000 use of reserves,but city closed the year with a$292,000 surplus after transfers into the general fund of$300,000 from its electric fund and$270,000 from the liquor fund.The total unassigned fund balance was$6.1 million or 53%of expenditures,which we consider very strong. Management stated that the city has not received local government aid(LGA)since 2009. For fiscal 2013,management is budgeting a$200,000 use of reserves due to higher personnel expenses. The city has additional reserves in its liquor fund,providing about$1.8 million of cash assets(compared to$4.1 million the prior year),available for the general fund. Officials used cash to retire all of the liquor store's debt in early 2012. Officials annually transfer about$270,000 into,the general fund from the liquor fund;they made a$300,000 transfer in 2012.The city also annually transfers between$300,000 and$500,000 from its electric fund,which it made in 2012 and plans to continue.Property taxes (83%)are the city's leading revenue stream,while charges and services(5.2%) account for most of the remainder. The city's financial management practices are considered"strong"under Standard&Poor's financial management assessment(FMA),indicating that practices management policies are strong,well embedded,and likely sustainable. Highlights of these policies include monthly reports to the city council on budgeted numbers compared to actual performance;the council can amend the budget,as necessary. Management maintains a long-term financial and capital plan and a debt management policy.The city-adopted reserve policy requires it to maintain a general fund unreserved balance of at least 40%of expenditures for cash flow purposes. In our opinion,the city's overall debt burden,excluding self-supporting utility debt,is a moderate$3,882 per capita or 4.8%of market value. Carrying charges were an elevated 19%of total governmental expenditures less capital outlay in 2011. Debt amortization is rapid with officials planning to retire 63%of principal in 10 years.At this time,management has stated that it does not have any additional debt plans. Management has designated stable revenue sources to fund WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JANUARY 14,2013 3 1062136 300126075 Summary: Elk River Economic Development Authority, Minnesota Elk River; General Obligation capital projects. Elk River does not provide retirees with other post-employment benefits.Retirees,however,can participate in the city's health insurance plan as long as they pay the entire premium cost themselves.The defined-benefit plans administered by the Minnesota Public Employees'Retirement Association(PERA)cover all full-time and certain part-time city employees.PERA administers the general employees'retirement fund(GERF)and the public employees police and fire fund(PEPFF),which are cost-sharing,multiple-employer retirement plans.In fiscal 2011,the city's contribution to GERF were$528,696 and PEPFF were$355,670,which equated to 4%of total governmental expenditures. Outlook The stable outlook reflects Standard&Poor's opinion that management will likely maintain balanced operations and, what we consider very strong reserves given it strong financial management practices. Given the current financial profile,we do not think we will change the rating within the outlook's two-year period. However,if the city's taxable market values continue to decline or growth and development pressures were to adversely affect the city's general fund operations and reserve levels then the rating would be lowered.The stable outlook also reflects our view the city's access to the St.Paul-Minneapolis and St. Cloud metropolitan areas. Related Criteria And Research • USPF Criteria:GO Debt,Oct. 12, 2006 • USPF Criteria:Financial Management Assessment,June 27, 2006 Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com.All ratings affected by this rating action can be found on Standard&Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column. WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JANUARY 14,2013 4 1052136 300176Q-7; Copyright©2013 by Standard&Poor's Financial Services LLC,All rights reserved. No content(including ratings,credit-related analyses and data,model,software or other application or output therefrom)or any part thereof (Content)may be modified,reverse engineered,reproduced or distributed in any form by any means,or stored in a database or retrieval system, without the prior written permission of Standard&Poor's Financial Services LLC or its affiliates(collectively,S&P).The Content shall not be used for any unlawful or unauthorized purposes.S&P and any third-party providers,as well as their directors,officers,shareholders,employees or agents (collectively S&P Parties)do not guarantee the accuracy,completeness,timeliness or availability of the Content.S&P Parties are not responsible for any errors or omissions(negligent or otherwise),regardless of the cause,for the results obtained from the use of the Content,or for the security or maintenance of any data input by the user.The Content is provided on an"as is"basis.S&P PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES,INCLUDING,BUT NOT LIMITED TO,ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE,FREEDOM FROM BUGS,SOFTWARE ERRORS OR DEFECTS,THAT THE CONTENTS FUNCTIONING WILL BE UNINTERRUPTED,OR THAT THE CONTENT WILL OPERATE WITH ANY SOFTWARE OR HARDWARE CONFIGURATION.In no event shall S&P Parties be liable to any party for any direct,indirect,incidental,exemplary,compensatory,punitive,special or consequential damages,costs,expenses,legal fees,or losses(including,without limitation,lost income or lost profits and opportunity costs or losses caused by negligence)in connection with any use of the Content even if advised of the possibility of such damages. Credit-related and other analyses,including ratings,and statements in the Content are statements of opinion as of the date they are expressed and not statements of fact.S&P's opinions,analyses,and rating acknowledgment decisions(described below)are not recommendations to purchase, hold,or sell any securities or to make any investment decisions,and do not address the suitability of any security.S&P assumes no obligation to update the Content following publication in any form or format.The Content should not be relied on and is not a substitute for the skill,judgment and experience of the user,its management,employees,advisors and/or clients when making investment and other business decisions.S&P does not act as a fiduciary or an investment advisor except where registered as such.While S&P has obtained information from sources it believes to be reliable,S&P does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives. To the extent that regulatory authorities allow a rating agency to acknowledge in one jurisdiction a rating issued in another jurisdiction for certain regulatory purposes,S&P reserves the right to assign,withdraw,or suspend such acknowledgement at any time and in its sole discretion.S&P Parties disclaim any duty whatsoever arising out of the assignment,withdrawal,or suspension of an acknowledgment as well as any liability for any damage alleged to have been suffered on account thereof. S&P keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of their respective activities.As a result,certain business units of S&P may have information that is not available to other S&P business units.S&P has established policies and procedures to maintain the confidentiality of certain nonpublic information received in connection with each analytical process. S&P may receive compensation for its ratings and certain analyses,normally from issuers or underwriters of securities or from obligors.S&P reserves the right to disseminate its opinions and analyses.S&P's public ratings and analyses are made available on its Web sites, www.standardandpoors.com(free of charge),and www.ratingsdirect.com and www.globalcreditportal.com(subscription),and may be distributed through other means,including via S&P publications and third-party redistributors.Additional information about our ratings fees is available at www.standardandpoors.com/usratingsfees. McGRAW-HILL WWW.STANDARDANDPOORS.COM/RATINGSDIRECT JANUARY 14,2013 5 1062136 300126975