03-078 RESEXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE CITY OF
ELK RIVER, MINNESOTA
Pursuant to due call and notice thereof, a regular or special meeting of the City
Council of the City of Elk River, Minnesota, was duly called and held at the Elk River City Hall
on November 10, 2003, beginning at approximately 7:07 o'clock P.M., C.T., for the purpose in
part of considering the sale of the City's General Obligation Water Revenue Bonds, Series
2003B.
The following members of the Council were present: Stephanie Klinzing, John
Dietz, Louise Kuester, Paul Motin and Dan Tveite;
and the following were absent: none.
During said meeting Deitz introduced the following Resolution in writing and moved its
adoption:
RESOLUTION NO. 03-78
RESOLUTION AWARDING THE SALE OF THE
CITY'S GENERAL OBLIGATION
WATER REVENUE BONDS, SERIES 2003B
AND PROVIDING FOR THEIR ISSUANCE
WHEREAS, the Council believes it to be in the City's best interest to consider a
refunding of (1) the City's General Obligation Permanent Improvement Revolving Fund Bonds,
Series 1993B, dated October 1, 1993, which included a portion of the bonds of said issue
designated as the "Series 1993B Water Revenue Bonds" (said portion being hereinafter referred
to as the "1993 Bonds") issued in the original principal amount of $1,125,000, and (2) the City's
General Obligation Water Revenue Bonds, Series 1994D, dated December 1, 1994 (the "1994
Bonds"), issued in the original principal amount of $1,010,000, and the 1993 Bonds and the 1994
Bonds are sometimes collectively referred to herein as the "Prior Bonds"; and
WHEREAS, the outstanding Prior Bonds which mature after February 1, 2004, being in
the aggregate principal amount of $985,000, are subject to prepayment on said date at the option
of the City at the redemption price of par plus accrued interest; and
WHEREAS, the above-described refunding of the callable Prior Bonds is consistent with
covenants made with the holders thereof and is necessary and desirable for and will result in the
reduction of debt service cost to the City; and
WHEREAS, the improvements (the "Improvements") to the City's municipal water
system and utility consisting of certain watermain improvements and a new well (#8) have been
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or will be duly ordered by the City and have been constructed by the City or will be constructed
under contracts which the City has or will let therefor, all pursuant to and in accordance with the
applicable provisions of Minnesota Statutes, Section 444.075, the total costs thereof being
estimated as follows:
Project Costs
Allowance for Discount
Costs of Issuance
Rounding
$975,000
12,060
13,754
4,186
$1,005,000
WHEREAS, it is necessary and expedient to the sound financial management of the
affairs of the City that the City issue $1,005,000 of its bonds (the "Nonrefunding Bonds")
pursuant to Minnesota Statutes, Chapter 475 and Section 444.075, to provide financing for the
Improvements; and
WHEREAS, it is necessary and expedient to issue the City's General Obligation Water
Revenue Bonds, Series 2003B (the "Bonds"), to provide moneys (together with other funds
available for such purpose) for a current refunding of the callable Prior Bonds (which Prior
Bonds to be refunded are referred to herein as the "Refunded Bonds") and to finance the
Improvements, respectively:
NOW, THEREFORE, BE IT RESOLVED by the City Council (the "Council") of the
City of Elk River, Minnesota (the "City"), as follows:
1. Acceptance of Offer.
(a) The offer of Robert W. Baird & Company, Inc., Milwaukee, Wisconsin
(the "Purchaser"), to purchase the City's General Obligation Water Revenue Bonds,
Series 2003B (the "Bonds", or individually a "Bond"), at the rates of interest and upon the
other terms set forth in this Resolution, and to pay therefor the sum of $1,983,897.00 plus
interest accrued to settlement, is hereby accepted.
(b) Book Entry_ Only System. The Depository Trust Company, in New York,
New York, pursuant to a certain Blanket Issuer Letter of Representations to be executed
by the City and accepted by said Trust Company (as the same may be supplemented or
superseded, and including all provisions thereof and rules, procedures or practices
referenced therein, the "Letter of Representations"), or any of 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 separate single fully registered Bond for each maturity of the Bonds;
and authorized denominations for each maturity of Bonds shall be deemed to be
limited during the Book Entry Only Period to the outstanding principal amount of
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that maturity. While in such book entry form, the Bonds are sometimes
hereinafter referred to as being in "Book Entry Only Form."
(ii) Upon initial issuance, ownership of the Bonds shall be registered
in a bond register maintained by the Bond Registrar described in this Resolution
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 City 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 to 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 City, 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 Beneficial 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 owner of any Bonds (the
"Holder"). For purposes of securing the vote or consent of any Holder under this
Resolution, the City 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 City 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 purpose
whatsoever. The Bond Registrar, as paying agent hereunder, shall pay all
principal of and premium, if any, and interest on the Bonds only to or upon the
Holder or the Holders of the Bonds, as shown on the Bond Registrar's bond
register, and all such payments shall be valid and effective to fully satisfy and
discharge the City'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
applicable to the Bonds, references to the Nominee hereunder shall refer to such
new Nominee.
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(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 the City, as the case may be, to the
Depository as provided in 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 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 City or the 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
City or the Bond Registrar may establish a special record date for such consent or
other action. The City or the Bond Registrar shall, to the extent possible, give the
Depository notice of such special record date not less than 15 calendar days in
advance thereof to the extent possible.
(ix) Any successor Bond Registrar, in its written acceptance of its
duties under this Resolution and any paying agency 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 Bond for a Bond of a lesser denomination, make a
notation of the reduction in principal amount on the panel provided on the Bond
stating the amount so redeemed.
(c) Termination of Book-Entry Only System. Discontinuance of the
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 City
and discharging its responsibilities with respect thereto under applicable law.
The City may terminate the services of the Depository with respect to the Bonds if
the City 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 City.
(ii) Upon termination of the services of the Depository as provided in
the preceding paragraph, and if no substitute securities depository is willing to
undertake the functions of the Depository hereunder can be found which, in the
opinion of the City, is willing and able to assume such functions upon reasonable
1580841vl 4
or customary terms, or if the City determines that it is in the best interests of the
City that the Beneficial Owners be issued certificates for the Bonds, the Bonds
shall no longer be registered 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 paragraph 11 hereof. To the extent that the Beneficial Owners
are designated as the transferee by the Holders, the Bonds will be delivered to the
Beneficial Owners.
(d) Letter of Representations. The provisions in the Letter of Representations
(the City's execution and delivery of which being hereby ratified and confirmed) are
incorporated herein by reference and made fully a part of this Resolution to the same
extent as if set forth in full herein, and if and to the extent that any provisions of this
Resolution or the Bonds are inconsistent or in conflict with the provisions of the Letter of
Representations, the provisions in the Letter of Representations shall control.
2. Title; Original Issue Date; Maturities; Denominations. The Bonds shall be titled
"General Obligation Water Revenue Bonds, Series 2003B," shall be dated December 9, 2003, as
the date of original issue, 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. The Bonds shall mature on February 1 in the
following years and amounts, respectively:
Year Amount Year Amount
2005 $105,000 2010 $200,000
2006 175,000 2011 210,000
2007 180,000 2012 220,000
2008 185,000 2013 230,000
2009 195,000 2014 235,000
As may be permitted in the offering of the Bonds and as may be requested by the
Purchaser, one or more term Bonds may be issued having mandatory sinking fund redemption
and final maturity amounts conforming to the foregoing principal repayment schedule, and
corresponding additions or other changes may be made to the form of the Bonds
The principal amounts of the Bonds are hereby allocated between the portion thereof
issued to refund the 1993 Bonds (the "1993 Refunding Bonds"), the portion thereof issued to
refund the 1994 Bonds (the "1994 Refunding Bonds"), and the portion thereof issued to finance
the Improvements (the "Nonrefunding Bonds"), respectively, as follows:
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Year Amount
1993
Refunding Bonds
1994
Refunding Bonds
Nonrefunding
Bonds
2005 $165,000
2006 175,000
2007 180,000
2008 185,000
2009 195,000
2010 200,000
2011 210,000
2012 220,000
2013 230,000
2014 235,000
$ 85,000
95,000
95,000
100,000
105,000
$ 80,000
8O,OO0
85,000
85,000
90,000
95,000
$105,000
210,000
220,000
230,000
235,000
$ 1,995,000 $ 480,000 $ 515,000 $1,000,000
The 1993 Refunding Bonds and the 1994 Refunding Bonds are sometimes collectively
referred to in this Resolution as the "Refunding Bonds."
3. Purposes; Refunding Findings. The Refunding Bonds shall provide moneys for a
current refunding of the City's Refunded Bonds, which refunding shall forthwith occur on
February 1, 2004, or on such subsequent date (the "Refunding Date") as shall be arranged by or
on behalf of the City Finance Director, but in all events not later than 90 days after the actual
issuance and delivery of the Bonds. It is hereby found, determined and declared that such
refunding is necessary or desirable for the reduction of debt service cost to the City and/or the
adjustment of the maturities of the Prior Bonds in relation to the sources for their repayment and
will result in a reduction of debt service cost to the City. All of the proceeds, including all
investment earnings thereon, of the Prior Bonds have heretofore been expended by the City for
the uses and purposes for which the City issued said Prior Bonds. The balance in the debt
service account heretofore established by the City for the payment of the principal of and interest
on the 1993 Bonds has been taken into account in appropriately sizing the 1993 Refunding
Bonds, and some monies therein are expected to be combined as of the Refunding Date, to the
extent necessary, with the available proceeds of the 1993 Refunding Bonds in order to obtain a
sum sufficient to accomplish the refunding of the 1993 Bonds and to pay the regularly scheduled
debt service due on the 1993 Bonds on said date; otherwise, the current and anticipated balances
in said debt service account do not exceed and are not expected to exceed the aggregate amount
of regularly scheduled debt service on the 1993 Bonds which is payable on or before the
Refunding Date.
The balance in the debt service account heretofore established by the City for the
payment of the principal of and interest on the 1994 Bonds has been taken into account in
appropriately sizing the 1994 Refunding Bonds, and some monies therein are expected to be
combined as of the Refunding Date, to the extent necessary, with the available proceeds of the
1994 Refunding Bonds in order to obtain a sum sufficient to accomplish the refunding of the
1994 Bonds and to pay the regularly scheduled debt service due on the 1994 Bonds on said date;
1580841vl 6
otherwise, the current and anticipated balances in said debt service account do not exceed and are
not expected to exceed the aggregate amount of regularly scheduled debt service on the 1994
Bonds which is payable on or before the Refunding Date.
The City has observed and complied with all of its obligations and covenants made by the
City in connection with the issuance of the Prior Bonds.
The Nonrefunding Bonds shall provide funds to finance the Improvements. The total
cost of the Improvements, which shall include all costs enumerated in Minnesota Statutes,
Section 475.65, is estimated to be at least equal to the amount of the Nonrefunding Bonds. Work
on the Improvements shall proceed with due diligence to completion.
4. Interest. The Bonds shall bear interest payable semiannually on February 1 and
August 1 of each year (each, an "Interest Payment Date"), commencing August 1, 2004,
calculated on the basis of a 360-day year consisting 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
2005 2.000% 2010 3.250%
2006 2.000% 2011 3.250%
2007 2.500% 2012 3.400%
2008 2.875% 2013 3.550%
2009 3.000% 2014 3.700%
5. Redemption. All Bonds maturing after February 1, 2011, shall be subject to
redemption and prepayment at the option of the City on said date and on any date thereafter at a
price of par plus accrued interest to date of redemption. Redemption may be in whole or in part
of the Bonds subject to prepayment. If redemption is in part, the City shall determine the amount
of Bonds of each maturity to be prepaid; 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 atter the redemption date.
Published notice of redemption shall in each case be given if and to the extent required by
applicable law, and mailed notice of redemption shall be given to the paying agent and to each
affected registered owner 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 of that maturity 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
1580841vl 7
redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the City or Bond
Registrar so requires, a written instrument of transfer in form satisfactory to the City or Bond
Registrar duly executed by the registered owner thereof or by the registered owner's attorney,
duly authorized in writing) and the City shall execute (if necessary) and the Bond Registrar shall
authenticate and deliver to the registered owner 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 registered owner, in aggregate
principal amount equal to and in exchange for the unredeemed portion of the principal of the
Bond so surrendered.
6. Bond Registrar. U.S. Bank Nationa Association, in St. Paul, Minnesota, is
appointed to act as bond registrar and transfer agent with respect to the Bonds (as used in this
Resolution, the "Bond Registrar"), and shall do so unless and until a successor Bond Registrar is
duly appointed, all pursuant to any contract the City and Bond Registrar shall execute which is
consistent with this Resolution. The Bond Registrar shall also serve as paying agent unless and
until a successor paying agent is duly appointed. Principal of and interest on the Bonds shall be
paid to the registered owners of the Bonds in the manner set forth in the form of Bond and
paragraph 12 of this Resolution.
7. 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:
1580841vl 8
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF SHERBURNE
CITY OF ELK RIVER
GENERAL OBLIGATION
WATER REVENUE BOND, SERIES 2003B
INTEREST MATURITY DATE OF
RATE DATE ORIGINAL ISSUE CUSIP
REGISTERED OWNER:
PRINCIPAL AMOUNT:
DOLLARS
KNOW ALL BY THESE PRESENTS that the City of Elk River, Sherburne County,
Minnesota (the "City"), acknowledges that it is indebted and, for value received, hereby 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 duly
called for prior redemption, and to pay interest thereon semiannually on February 1 and August 1
of each year (each, an "Interest Payment Date"), commencing August 1, 2004, at the per annum
rate of interest specified above (calculated on the basis of a 360 day year consisting 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 this Bond is
payable upon -presentation and surrender hereof at the principal office of
, in
(the "Bond Registrar"), acting as paying agent, or any successor paying agent
duly appointed by the City. 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 City 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 instead be payable to the person that 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
interest on this Bond are payable in lawful money of the United States of America.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS SHALL FOR
ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE.
1580841vl 9
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 have happened 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 indebtedness of the City outstanding on the date of original
issue hereof and on the date of its actual issuance and delivery to the original purchaser, does not
exceed any constitutional or statutory limitation of indebtedness.
IN WITNESS WHEREOF, the City of Elk River, Sherburne County, Minnesota, by its
City Council, has caused this Bond to be executed on its behalf by the facsimile signatures of its
Mayor and City Administrator; has caused the official seal of the City to be intentionally omitted
herefrom, as permitted by law; and has caused this Bond to be executed manually by the Bond
Registrar, acting as the City's duly appointed authenticating agent for the Bonds.
Date of Registration:
Registrable by:
Bond Registrar's
CERTIFICATE OF
AUTHENTICATION
This Bond is one of the Bonds
described in the Resolution
mentioned within.
Payable at:
CITY OF ELK RIVER,
SHERBURNE COUNTY, MINNESOTA
Bond Registrar
By
Authorized Signature
Mayor
City Administrator
~58o84~v~ 1 0
ON REVERSE OF BOND
Redemption. All Bonds of this issue maturing after February 1, 2011, are subject to
redemption and prepayment at the option of the City on said date and on any date thereafter at a
price of par plus accrued interest to date of redemption. Redemption may be in whole or in part
of the Bonds subject to prepayment. If redemption is in part, the City shall determine the amount
of Bonds of each maturity to be prepaid; and if only part of the Bonds having a common maturity
date are called for prepayment, the Bonds of that maturity 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. Published notice of redemption shall in each case be given if and to the extent required by
applicable law, and mailed notice of redemption shall be given to the paying agent and to each
affected registered owner of the Bonds..
Selection of Bonds for Redemption; Partial Redemption. To effect a 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 City or Bond Registrar so requires, a written instrument of transfer in form
satisfactory to the City and Bond Registrar duly executed by the Holder thereof or the Holder's
attorney duly authorized in writing), and the City shall execute 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 $ ., all of like date of original issue and tenor, except as to
registration number, maturity, interest rate, denomination, and redemption privilege, which
Bonds have been issued pursuant to and in full conformity with the Constitution and laws of the
State of Minnesota, including Minnesota Statutes, Section 475.67, and pursuant to a resolution
adopted by the City Council, the governing body of the City, on November 10, 2003 (the
"Resolution"), for the primary purpose of providing moneys, together with other available funds
of the City, sufficient to prepay certain prior general obligation bonds of the City and to finance
certain improvements to the City's municipal water system and utility. This Bond constitutes a
general obligation of the City, and to provide moneys for the prompt and full payment of the
principal of and interest on all of the Bonds, when the same become due, the full faith and credit
and taxing powers of the City have been and are hereby irrevocably pledged. Each capitalized
term which is used but not otherwise defined in this Bond shall have the meaning given to that
term in the Resolution.
1580841vl 1 1
[For Bonds in Book Entry Only Form, the following paragraph shall be added, and this
Bond form (1) may be rearranged so that the signature blocks hereof appear at the end of
the main text of this form or (2) may otherwise be amended to conform to book entry
requirements and the Letter of Representations.]
Book Entry Only Form; Letter of Representations. Pursuant to the Resolution, the Bonds
may be issued in Book Entry Only Form, and during any period in which Bonds are in such
form, the provisions applicable to the Bonds pursuant to the Letter of Representations (as defined
in the Resolution) shall apply, notwithstanding any contrary or inconsistent provision herein or in
the Resolution.
Denominations; Exchange; Resolution. The Bonds are issuable solely as fully registered
bonds 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 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 City contained in any agreement with the Bond
Registrar. Thereupon the City 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 beating 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 City 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 City nor the Bond
Registrar shall be affected by notice to the contrary.
Authentication. 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 manually
executed by the Bond Registrar.
1580841vl 12
Designation of Bond as Qualified Tax-Exempt Obligation. This Bond has been
designated by the City as a "qualified tax-exempt obligation" for purposes of Section 265(b)(3)
of the Internal Revenue Code of 1986, as amended.
1580841vl 13
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:
UTMA -
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with fight of survivorship
and not as tenants in common
as custodian for
(Gust)
under the
(State)
Transfers to Minors Act
(Minor)
Uniform
Additional abbreviations may also be used
though not in the above list.
1580841vl 14
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond and does hereby
irrevocably constitute and appoint as 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, by a brokerage firm having
a membership in one of the major stock exchanges or by any other "Eligible Guarantor
Institution" as defined in 17 CFR 240.17 Ad-15(a)(2).
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.)
1580841vl 15
8. Execution; Temporary Bonds. The Bonds shall be executed on behalf of the City
by the signatures of its Mayor and City Administrator, and the official seal of the City may be
omitted from the Bonds, as permitted by law; provided that such signatures and said seal may be
printed facsimiles. In the event of disability or resignation or other absence of any such officer,
the Bonds may be signed by the manual or facsimile signature of that officer who may act on
behalf of such absent or disabled officer. In case any such 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, such signature or facsimile shall nevertheless be valid and sufficient for all purposes,
the same as if he or she had remained in office until delivery. The City may elect to deliver, in
lieu of printed definitive bonds, one or more typewritten temporary bonds in substantially the
form set forth above, with such changes as may be necessary to reflect more than one maturity in
a single temporary bond. Such temporary bonds may be executed with photocopied facsimile or
manual signatures of the Mayor and City Administrator. Such temporary bonds shall, upon the
printing of the definitive bonds and the execution thereof, be exchanged therefor and cancelled.
9. 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
such Bond, substantially in the form hereinabove set forth, shall have been duly and manually
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 City 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, which date is December 9, 2003. The Certificate of Authentication so executed on
each Bond shall be conclusive evidence that it has been authenticated and delivered under this
Resolution.
10. Registration; Transfer; Exchange. The City 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
City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of
registration of (as provided in paragraph 9) 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 registered owner, 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 City shall execute (if
1580841vl 16
necessary), and the Bond Registrar shall authenticate, insert the date of registration of, and
deliver the Bonds which the registered owner making the exchange is entitled to receive.
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
City.
All Bonds delivered in exchange for or upon transfer of Bonds shall be valid obligations
of the City 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 registered owner thereof or the registered owner'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 City 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.
11. 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.
12. 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 City maintained by the Bond Registrar
and at the address appearing thereon at the close of business on the fifteenth (15th) 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 that is the Holder thereof
as of the Regular Record Date and shall be payable to the person that 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 (10) days prior to the
Special Record Date.
13. Treatment of Registered Owner. The City 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 interest (subject to the payment provisions in paragraph 12
above) on such Bond and for all other purposes whatsoever, whether or not such Bond shall be
overdue, and neither the City nor the Bond Registrar shall be affected by notice to the contrary.
~58084~vi 17
14. Delivery; Application of Proceeds. The Bonds when so prepared and executed
shall be delivered by the City to the Purchaser upon receipt of the purchase price, and the
Purchaser shall not be obliged to see to the proper application thereof.
15. Fund and Accounts. For the convenience and proper administration of the
moneys to be borrowed and repaid on the Bonds, there is hereby created a special fund to be
designated the General Obligation Water Revenue Bonds, Series 2003B, Fund" (the "Fund") to
be administered and maintained by the City as a bookkeeping account separate and apart from all
other funds maintained in the official financial records of the City. The Fund shall be maintained
in the manner herein specified until all of the Refunded Bonds and the Bonds herein authorized
and the interest thereon shall have been fully paid. There shall be maintained in the Fund three
separate accounts, to be designated the "Refunding Account," the "Capital Account" and the
"Debt Service Account," respectively.
(i) Refunding Account. The proceeds of the sale of the Refunding
Bonds, less such proceeds of the Refunding Bonds as may be used to pay
allocated issuance expenses or hereinafter directed for deposit into the Debt
Service Account, plus any other available municipal funds ("Other Funds"), if
any, as may be required to adequately fund the Refunding Account to accomplish
its purposes, together with all investment earnings on funds held in the Refunding
Account, are hereby pledged and appropriated and shall be credited to the
Refunding Account. The Refunding Account may be invested only in securities
maturing or callable on such dates and beating interest at such rates as shall be
required to provide funds sufficient, together with any cash or other funds
retained in the Refunding Account, and together with monies made available from
the debt service account for the Prior Bonds, to pay all principal and interest due
on the Prior Bonds on the Refunding Date (as described in paragraph 3 of this
Resolution), whether due thereon by virtue of regularly scheduled debt service or
prior redemption. The moneys in the Refunding Account shall be used solely for
the purposes herein set forth and for no other purpose, except that any surplus in
the Refunding Account shall be remitted to the City. Such Other Funds, if any, as
may be required to fully fund the Refunding Account as described above are
hereby appropriated for said purpose.
(ii) Capital Account. To the Capital Account there shall be credited
the proceeds of the sale of the Nonrefunding Bonds, less such amounts thereof as
shall be used to pay their allocated issuance expenses or deposited into the Debt
Service Account pursuant to paragraph 16(iii) below. From the Capital Account
there shall be paid all costs and expenses of making the Improvements, including
the cost of any construction contracts heretofore let, the costs of issuing the
Nonrefunding Bonds and all other costs incurred and to be incurred of the kind
authorized in Minnesota Statutes, Section 475.65; and the moneys in said account
shall be used for no other purpose except as otherwise provided by law.
(iii) Debt Service Account. To the Debt Service Account there are
hereby pledged and irrevocably appropriated and there shall be credited: (1) all
-accrued interest on the Bonds, which shall be used to pay the interest first coming
1580841vl 18
due thereon; (2) any balance remaining on the Refunding Date, after payment
thereon of all of the principal of and interest on all of the Prior Bonds, in the debt
service accounts created for and allocated to the Prior Bonds pursuant to the
Council's resolutions adopted in connection with the issuance of the Prior Bonds;
(3) the net revenues (as hereinafter defined, the "Net Revenues") of the City's
municipal water system and utility, but only in such amounts as shall be
necessary, together with other monies in the Debt Service Account and available
for such purposes, to pay, when due, the principal of and interest on the Bonds;
(4) all collections of any ad valorem taxes levied for the payment of the Bonds;
(5) all investment earnings on funds held in the Debt Service Account; and (6)
any amounts received by the City upon termination of the Refunding Account.
The foregoing funds are hereby pledged to the Debt Service Account, but only in
such amounts and at such times as may be necessary, together with other available
funds therein (and the same shall be used solely), to pay the principal of and
interest on the Bonds, when due.
As used in this Resolution, the term Net Revenues means the gross revenues
derived by the City from the operation of its municipal water system and utility, including all
charges for service, use, availability, and connection to said system, and all monies received
from the sale of any facilities or equipment of said system or any by-products thereof, less all
normal, reasonable, or current costs of owning, operating, and maintaining the system. If any
payment of principal or interest on the Bonds shall become due when there are not sufficient
funds in the Debt Service Account to pay the same, the City Finance Director shall pay such
principal or interest from the general fund or other available fund of the City, and such fund shall
be reimbursed for such advances from the proceeds of the Net Revenues or of any general ad
valorem taxes hereafter levied for such purpose, when collected. The City hereby covenants that
it will impose and collect charges for the service, use, and availability of and connection to the
City's municipal water system and utility at the times and in the amounts required to produce Net
Revenues adequate, together with other sources of funding available to the Debt Service
Account, to pay all principal of and interest on the Bonds, when due.
Nothing contained herein shall be deemed to preclude the City from making
further pledges and appropriations of the Net Revenues of the City's municipal water system and
utility for the payment of other or additional obligations of the City, provided that it has first
been determined that the estimated Net Revenues will be sufficient, in addition to all other
sources, for the payment of the Bonds and such additional obligations, and any such pledge and
appropriation of said Net Revenues may be made superior or subordinate to, or on a parity with,
the pledge and appropriation herein. With respect to all currently outstanding obligations of the
City which are payable from the Net Revenues, the Council hereby determines that the estimated
Net Revenues will be sufficient, in addition to all other sources available for such purposes, for
the payment of the Bonds and all such other obligations.
No portion of the proceeds of the Bonds shall 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 for an available and reasonable "temporary period" until
such proceeds are needed for the purpose for which the Bonds were issued, and for any available
"minor portion." To this effect, any proceeds of the Bonds and any sums from time to time held
1580841vl 19
in the Refunding Account, the Capital Account and Debt Service Account (or any other City
account which will be used to pay principal and interest to become due on the Bonds) in excess
of amounts which under then-applicable federal arbitrage regulations may be invested without
regard to yield shall 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 shall 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, and regulations, rulings and decisions thereunder (the "Code").
16. Coverage Test; Certificate of Registration. It is hereby found and determined that
the Net Revenues pledged herein for the payment of the Bonds will be available in amounts
sufficient to produce at least five percent (5%) in excess of the amount needed to meet, when
due, the principal and interest payments on the Bonds.
The City shall file a certified copy of this Resolution with the office of the County
Auditor of Sherburne County and obtain the certificate of said office required by Minnesota
Statutes, Section 475.63.
17. General Obligation Pledge. For the prompt and full payment of the principal of
and interest on the Bonds, as the same respectively become due, the full faith and credit and
taxing powers of the City shall be and are hereby irrevocably pledged. If the balance in the Debt
Service Account is ever insufficient to pay all principal and interest then due on the Bonds, the
deficiency shall be promptly paid out of any other funds of the City which are available for such
purpose, and such other funds may be reimbursed with or without interest from the 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 City shall levy
an ad valorem tax upon all taxable property within the City sufficient for such purposes.
18. Prior Bonds; Security. Until retirement and full payment of the Prior Bonds, all
provisions heretofore made for the security thereof shall be observed by the City.
19. Redemption of Refunded Bonds. The outstanding Prior Bonds maturing in 2005
and thereafter shall be redeemed and prepaid on the Refunding Date (as described in paragraph 3
of this Resolution), and prior to said date, the paying agent/registrars for the Prior Bonds are
hereby authorized and directed to cause notice of said redemption to be published and to be
given to the owners of the Prior Bonds in such manner as may be required by law and by the
terms of the Prior Bonds.
20. Records and Certificates. The officers of the City 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 City relating to the
Bonds and to the financial conditioh and affairs of the City, and such other affidavits, certificates
and information as are required to show the facts relating to the Bonds as the same appear from
the books and records under their custody and control or as otherwise known to them, and all
1580841vl 20
such certified copies, certificates and affidavits, including any heretofore furnished, shall be
deemed representations of the City as to the facts recited therein.
21. Negative Covenant as to Use of Proceeds and Improvements. The City hereby
represents that it has not used, and hereby covenants that it will not use, and that it has not
permitted and will not permit any such uses, the proceeds of the Bonds, or the Improvements, or
the projects (the "Projects") financed by (or the proceeds of) the Prior Bonds in such a manner as
to cause the Bonds or the Prior Bonds to be "private activity bonds" under Sections 103 and 141
through 150 of the Code.
In particular, but without limitation, the City covenants to forebear the implementation,
effectuation or enforcement of any and all contracts or other agreements respecting the
Improvements, the Projects or any property benefitted thereby or assessed with respect thereto,
which the City may now or in the future have with developers, contractors, owners or any other
person or parties to the extent that such implementation, effectuation or enforcement would
(individually or in the aggregate) cause the Bonds or the Prior Bonds to become such "private
activity bonds," and to said limited extent the City would and hereby does (solely for the benefit
of the owners of the Bonds) disavow any and all such provisions, entitlements and enforcements.
22. Tax-Exempt Status of the Bonds; Rebate. The City shall comply with
requirements necessary under the Code to establish and maintain the exclusion from gross
income under Section 103 of the Code of the interest on the Bonds, including without limitation
(1) requirements relating to temporary periods for investments, (2) limitations on amounts
invested at a yield greater than the yield on the Bonds, and (3) the rebate of excess investment
earnings to the United States and to the extent applicable.
As indicated below, the 1993 Refunding Bonds and the Nonrefunding Bonds (but not the
1994 Refunding Bonds) are being qualified under the small issuer exception to arbitrage rebate.
For purposes of qualifying the 1993 Refunding Bonds and the Nonrefunding Bonds for
the small issuer exception to the federal arbitrage rebate requirements, the City hereby finds,
determines and declares that (1) the Bonds are issued by a governmental unit with general taxing
powers, (2) no Bond is a private activity bond, (3) ninety-five percent (95%) or more of the net
proceeds of the Bonds are to be used for local governmental activities of the City (or of a
governmental unit the jurisdiction of which is entirely within the jurisdiction of the City), and (4)
the aggregate face amount of all tax-exempt obligations (other than private activity bonds) issued
by the City (and all entities subordinate to, or treated as one issuer with, the City) during the
2003 calendar year is not reasonably expected to exceed $5,000,000, all within the meaning of
Section 148(f)(4)(D) of the Code.
For purposes of substantiating the determination that the 1993 Refunding Bonds, being
refunding bonds, are eligible for exception from rebate pursuant to the above, in particular
because they meet the applicable requirements set out in Section 148(f)(4)(D)(v) of the Code, the
City hereby represents and determines that (1) the 1993 Bonds were issued in 1993 by the City,
which was at that time and is now a governmental unit with general 'taxing powers; (2) the 1993
Bonds were not private activity bonds under Sections 103 and 141 through 150 of the Code, and
the City qualified the 1993 Bonds within the "small-issuer" exception of Section 148(f)(4)(D) of
1580841vl 21
the Code; (3) 95% or more of the net proceeds of the 1993 Bonds were used for local
governmental activities of the City; (4) the City, together with all issuers subordinate to or
treated as one issuer with the City, did not issue in excess of $5,000,000 of bonds (other than
private activity bonds) during calendar year 1993; (5) the average maturity date of the 1993
Refunding Bonds is not later than the average maturity date of the 1993 Bonds being refunded
thereby; and (6) none of the 1993 Refunding Bonds has a maturity date which is later than 30
years after the date on which the 1993 Bonds were issued.
23. Designation of Qualified Tax-Exempt Obligations. The City hereby designates
the Bonds (and hereby treats $475,000 of the 1993 Refunding Bonds and $510,000 of the 1994
Refunding Bonds as "deemed designated" under Section 265(b)(3)(D)(ii) of the Code) as
"qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Code and
further represents that:
(a) 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 City (and all entities subordinate to, or treated as one
issuer with, the City) during calendar year 2003 will not exceed $10,000,000; and
(b) not more than $10,000,000 of obligations issued or to be issued by the
City during calendar year 2003 have been designated for purposes of Section 265(b)(3) of
the Code.
The City shall use its best efforts to comply with any federal procedural requirements which may
apply in order to effectuate the designation made by this paragraph.
As indicated above, the City is treating a portion the principal amounts of the 1993
Refunding Bonds and the 1994 Refunding Bonds as "deemed designated" (but only to the extent
that the same do not exceed the respective principal amounts of the 1993 Bonds and the 1994
Bonds being currently refunded thereby) pursuant to the advice of bond counsel and the
provisions of Section 265(b)(3)(D)(ii) of the Code by virtue of the facts (1) that the Prior Bonds
were designated by the City as qualified tax-exempt obligations pursuant to Section 265(b)(3) of
the Code; (2) that such portions of the Bonds, being current refunding obligations, are not taken
into account for purposes of the 2003 $10,000,000 limit, (3) the average maturity of the 1993
Refunding Bonds and the 1994 Refunding Bonds is less than the average maturity of the 1993
Bonds and the 1994 Bonds being refunded thereby, respectively; and (4) that no Bond has a
maturity date which is more than 30 years after the date that the original qualified tax-exempt
obligations (being the Prior Bonds) were issued.
24. Compliance With Reimbursement Bond Regulations. With respect to the
Improvements, the City has complied and will continue to comply with the "Reimbursement
Regulations" provided in United States Treasury Regulations Section 1.150-2. In particular,
except where the following may not be required by said Regulations (e.g., with respect to certain
"preliminary expenditures"), to the extent that any of the proceeds of the Nonrefunding Bonds
will be used to reimburse the City for a cost of the Improvements theretofore paid and
temporarily financed by the City out of other City funds, prior to the initial payment thereof (or
within applicable time limits thereafter) the City has made or will have made a duly qualifying.
1580841vl 22
statement of its official intent to bond for such costs (and the City will also make the written
"reimbursement allocation" required by the Reimbursement Regulations); otherwise, the
proceeds of the Nonrefunding Bonds are to be used for initial payment, and not for such
reimbursement, of costs of the Improvements.
25. Defeasance. When any obligation of a Bond has been discharged as provided in
this paragraph, all pledges, covenants and other rights granted by this Resolution to the registered
owner of that Bond (with respect to the obligation thereof so defeased) shall, to the extent
permitted by law, cease. The City may at any time discharge any or all of such obligation(s)
with respect to any Bond, subject to the provisions of law now or hereafter authorizing or
regulating such action, by depositing irrevocably in escrow, with a suitable institution qualified
by law as an escrow agent for this purpose, cash or securities which are backed by the full faith
and credit of the United States of America, beating interest payable at such times and at such
rates and maturing on such dates and in such amounts as shall be required and sufficient, subject
to sale and/or reinvestment in like securities, to pay said obligation(s), which may include any
interest payment on such Bond and/or principal amount due thereon at a stated maturity (or if
irrevocable provision shall have been made for permitted prior redemption of such principal
amount, at such earlier redemption date).
26. Continuing Disclosure Undertaking. The Council hereby acknowledges that the
Bonds are subject to continuing disclosure requirements under Rule 15c2-12(b)(5) (the "Rule")
of the Securities and Exchange Commission. Consequently, on the date of actual issuance and
delivery of the Bonds, the City will execute and deliver a Continuing Disclosure Undertaking
(the "Undertaking") whereunder the City will covenant to provide, or cause to be provided,
annual financial information, including audited financial statements of the City, and notices of
certain material events, as specified in the Undertaking. The proposed form of the Undertaking
which has been submitted to the City for the Council's consideration is hereby approved, and the
officers of the City are hereby authorized to execute and deliver that Undertaking in the proposed
form or in such final form thereof reflecting such modifications thereof as are consistent with the
Rule, requested by the original purchaser of the Bonds and acceptable to the City officials who
shall execute the Undertaking (which consent shall be conclusively evidenced by their execution
and delivery thereof). The Undertaking, as so executed and delivered by the City, shall be as
much a part of this Resolution as if set forth in full herein and shall be for the benefit of the
owners from time to time of the Bonds.
27. 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.
28. 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.
Adopted on November 10, 2003, by the Elk River City Council.
1580841vl 23
The motion for the adoption of the foregoing resolution was duly seconded by
Councilmember Tveite and upon a vote being taken thereon, the following C0uncilmembers
voted in favor thereof: Klinzing, Dietz, Kuester, Tveite and Motin;
and the following Councilmembers voted against the same: none.
Whereupon said resolution was declared to have been duly passed and adopted.
1580841vl 24
BID TABULATION
$2,020,000' General Obligation Water Revenue Bonds, Series 2003B
CITY OF ELK RIVER, MINNESOTA
SALE: November 10, 2003
AWARD: ROBERT W. BAIRD & COMPANY, INC.
RATING: Moody's Investors Service '%2"
BBI: 4.83%
NAME OF BIDDER MATURITY RATE REOFFERING PRICE
(February 1) YIELD
NET TRUE
INTEREST INTEREST
COST RATE
ROBERT W. BAIRD & COMPANY, INC.
Milwaukee, Wisconsin
CITIGROUP GLOBAL MARKETS, INC.
Chicago, Illinois
U.S. BANCORP PIPER JAFFRAY
Minneapolis, Minnesota
2005 2.000% 1.350%
2006 2.000% 1.750%
2007 2.500% 2.100%
2008 2.875% 2.500%
2009 3.000% 2.850%
2010 3.250% 3.150%
2011 3.250% 3.350%
2012 3.400% 3.500%
2013 3.550% 3.650%
2014 3.700% 3.800%
2005 2.000%
2006 2.000%
20O7 2.25O%
2008 2.75O%
2009 3.000%
2010 3.250%
2011 3.375%
2012 3.375%
2013 3.500%
2014 3.700%
2005 3.000%
2006 3.000%
2007 3.000%
2008 3.000%
2009 3.000%
2010 3.100%
2011 3.300%
2012 3.400%
2013 3.500%
2014 3.600%
$2,008,805.85 $403,789.67 3.3628%
$2,005,449.20 $405,148.74 3.3771%
$2,012,348.80 $405,425.64 3.3800%
*Subsequent to bid opening the issue size was decreased to $1,995,000 with the 2005 maturity decreased $10,000 to $165,000, the
2006 maturity decreased $10,000 to $175,000 and the 2014 maturity decreased $5,000 to $235,000 in maturity value.
Adjusted Price - $1,983,897.00
Adjusted Net Interest Cost- $401,164.02
Adjusted TIC - 3.3647%
EHLERS
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113-1105
651.697.8500 fax 651.697.8555 www.ehlers-inc.com
Offices in Roseville, MN, Brookfield, WI and Naperville, IL
$2,020,000 General Obligation Water Revenue Bonds, Series 2003B
City of Elk River, Minnesota
Page~
NAME OF BIDDER MATURITY RATE
(February 1)
REOFFERING
YIELD
PRICE
NET
INTEREST
COST
TRUE
INTEREST'
RATE
GRIFFIN, KUBIK, STEPHENS
& THOMPSON, INC.
Chicago, Illinois
2005 2.500%
2OO6 2.5OO%
2007 2.500%
2008 2.500%
2009 3.000%
2010 3.000%
2011 3.300%
2012 3.500%
2013 3.625%
2014 3.700%
$2,003,397.90
$410,354.52
3.4237%
BANC ONE CAPITAL MARKETS, INC.
Chicago, Illinois
2005 2.500%
2006 2.500%
2007 2.500%
2008 2.5OO%
2009 2.700%
2010 3.000%
2011 3.250%
2012 3.500%
2013 3.625%
2014 3.700%
$1,999,325.35
$410,667.40
3.4302%
City Clerk's Certificate
I, the undersigned, being the duly qualified and acting City Clerk of 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 an excerpt of the official minutes of a meeting of the City Council of
said City, duly called and regularly held on the date therein indicated, insofar as such minutes
relate to authorizing the issuance and awarding the sale of the City's General Obligation Water
Revenue Bonds, Series 2003B.
WITNESS my hand as such City Clerk and the seal of said City this~/:~/~lay of
City ~ E'lkk River, Minnesota
City
(SEAL)
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