Loading...
8.1. SR 07-21-2014 City of Elk Request for Action River To Item Number Mayor and City Council 8.1 Agenda Section Meeting Date Prepared by General Business July 21, 2014 Tim Simon, Finance Director Item Description Reviewed by Resolution Awarding Sale of General Obligation Cal Portner, City Administrator Sewer Revenue Bonds, Series 2014B Reviewed by Action Requested Adopt,by motion,a resolution of the City of Elk River awarding the sale of$10,000,000 City of Elk River,Minnesota General Obligation Sewer Revenue Bonds, Series 2014B; fixing their form and specifications; directing their execution and delivery; and providing for their payment. Background/Discussion On June 16, 2014, the City Council passed a resolution providing for the competitive negotiated sale of $10,000,000 General Obligation Sewer Revenue Bonds, Series 2014B. Kathleen Aho of Springsted will be at this meeting to present the results of the sale of the General Obligation Sewer Revenue Bonds, Series 2014B for the wastewater expansion project. Bids will be received at 9:00 a.m. on July 21, 2014. In addition, staff held a rating call/tour with Standard and Poor's (S&P) on July 8, 2014; the results of the rating will be presented at the meeting. Financial Impact Sewer Enterprise fund will repay the bonds related to this project via utility rates. Besides the bonds, the funding sources are $3,000,000 sewer reserves, $2,800,000 state grant, and$1,000,000 trunk utility funds. The 10-year forecast has been updated to reflect the estimated bonds. Attachments ■ Resolution P a w E A E U s r Template Updated 4/14 INIM UREI City of Elk River Resolution 14- A Resolution of the City of Elk River Awarding the Sale of$10,000,000 City of Elk River, Minnesota General Obligation Sewer Revenue Bonds, Series 201413; Fixing their Form and Specifications; Directing their Execution and Delivery; and Providing for their Payment WHEREAS, Pursuant to Minnesota Statutes, Section 444.075 and Chapter 475, as amended (together, the"Act"), the City is authorized to issue obligations in order to finance a wastewater facility improvement project within the City(the "Project"). NOW, THEREFORE, BE IT RESOLVED by the City Council (the "Council") of the City of Elk River,Minnesota (the "City") as follows: Section 1. Sale of Bonds. 1.01. Award to the Purchaser and Interest Rates. The proposal of F'IN Financial Capital Markets of Memphis, Tennessee (the "Purchaser") to purchase the Bonds of the City is found and determined to be a reasonable offer and is accepted, the proposal being to purchase the General Obligation Sewer Revenue Bonds, Series 2014B (the "Bonds") at a price of $10,036,220.65 (par amount of $10,000,000, plus original issue premium of $102,780.65, less underwriter's discount of $66,560.00),plus accrued interest, for Bonds bearing interest as follows: Year Interest Rate Year Interest Rate 2016 2.00% 2025 2.50% 2017 2.00 2026 2.75 2018 2.00 2027 3.00 2019 2.00 2028 3.00 2020 2.00 2029 3.00 2021 2.00 2030 3.25 2022 2.00 2034 3.40 2023 2.50 2035 3.50 2024 2.50 1.02. Purchase Contract. Any original issue premium and any rounding amount shall be credited to the Debt Service Fund hereinafter created, or deposited in the Construction Fund under Section 4.01 hereof, as determined by the City's financial advisor and the City Finance Director. The City Finance Director is directed to retain the good faith check of the Purchaser, pending 445655v4 JSB EL 185-27 completion of the sale of the Bonds, and to return the good faith checks of the unsuccessful proposers. The Mayor and City Clerk are authorized to execute a contract with the Purchaser on behalf of the City. 1.03. Terms and Principal Amounts of the Bonds. The City will forthwith issue and sell the Bonds pursuant to the Act in the total principal amount of$10,000,000, originally dated August 21, 2014, in the denomination of $5,000 each or any integral multiple thereof, numbered No. R-1, upward, bearing interest as above set forth, and maturing serially on February 1 in the years and amounts as follows: Year Amount Year Amount 2016 $400,000 2025 $480,000 2017 405,000 2026 490,000 2018 415,000 2027 500,000 2019 420,000 2028 520,000 2020 430,000 2029 530,000 2021 440,000 2030 550,000 2022 450,000 2034 2,395,000 2023 455,000 2035 655,000 2024 465,000 1.04. Optional Redemption. The City may elect on February 1,2022, and on any day thereafter to prepay Bonds due on or after February 1, 2023. Redemption may be in whole or in part and if in part, at the option of the City and in such manner as the City will determine. If less than all Bonds of a maturity are called for redemption, the City will notify DTC (as defined in Section 7 hereof) of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. Prepayments will be at a price of par plus accrued interest. 1.05. Mandatory Sinking Fund Redemption. The Bonds maturing in the year 2034 are subject to mandatory sinking fund redemption on February 1 of the following years in the following principal amounts: Year Principal Amount 2031 $570,000 2032 585,000 2033 610,000 2034* 630,000 * Maturity The principal amounts of the Bonds subject to mandatory sinking fund redemption on any date may be reduced through earlier optional redemptions, with any partial redemptions of such Bonds 445655v4 JSB EL 185-27 2 credited against future mandatory sinking fund redemptions of such Bonds in such order as the City shall determine. Section 2. Registration and Pam. 2.01. Registered Form. The Bonds will be issued only in fully registered form. The interest thereon and, upon surrender of each Bond, the principal amount thereof, is payable by check or draft issued by the Registrar described herein. 2.02. Dates: Interest Payment Dates. Each Bond will be dated as of the last interest payment date preceding the date of authentication to which interest on the Bond has been paid or made available for payment,unless (i) the date of authentication is an interest payment date to which interest has been paid or made available for payment,in which case the Bond will be dated as of the date of authentication, or (ii) the date of authentication is prior to the first interest payment date, in which case the Bond will be dated as of the date of original issue. The interest on the Bonds will be payable on February 1 and August 1 of each year, commencing February 1,2015, to the registered owners of record thereof as of the close of business on the fifteenth day of the immediately preceding month,whether or not that day is a business day. 2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating agent and paying agent (the "Registrar"). The effect of registration and the rights and duties of the City and the Registrar with respect thereto are as follows: (a) Re i ster. The Registrar must keep at its principal corporate trust office a bond register in which the Registrar provides for the registration of ownership of Bonds and the registration of transfers and exchanges of Bonds entitled to be registered, transferred or exchanged. (b) Transfer of Bonds. Upon surrender for transfer of a Bond duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar will authenticate and deliver, in the name of the designated transferee or transferees, one or more new Bonds of a like aggregate principal amount and maturity, as requested by the transferor. The Registrar may, however, close the books for registration of any transfer after the fifteenth day of the month preceding each interest payment date and until that interest payment date. (c) Exchange of Bonds. When Bonds are surrendered by the registered owner for exchange the Registrar will authenticate and deliver one or more new Bonds of alike aggregate principal amount and maturity as requested by the registered owner or the owner's attorney in writing. (d) Cancellation. Bonds surrendered upon transfer or exchange will be promptly cancelled by the Registrar and thereafter disposed of as directed by the City. (e) Improper or Unauthorized Transfer. When a Bond is presented to the Registrar for transfer, the Registrar may refuse to transfer the Bond until the Registrar is satisfied that the endorsement on the Bond or separate instrument of transfer is valid and 445655v4 JSB EL 185-27 3 genuine and that the requested transfer is legally authorized. The Registrar will incur no liability for the refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. (f) Persons Deemed Owners. The City and the Registrar may treat the person in whose name a Bond is registered in the bond register as the absolute owner of the Bond, whether the Bond is overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on the Bond and for all other purposes, and payments so made to a registered owner or upon the owner's order will be valid and effectual to satisfy and discharge the liability upon the Bond to the extent of the sum or sums so paid. (g) Taxes, Fees and Charges. The Registrar may impose a charge upon the owner thereof for a transfer or exchange of Bonds sufficient to reimburse the Registrar for any tax, fee or other governmental charge required to be paid with respect to the transfer or exchange. (h) Mutilated,Lost, Stolen or Destroyed Bonds. If a Bond becomes mutilated or is destroyed, stolen or lost, the Registrar will deliver a new Bond of like amount, number, maturity date and tenor in exchange and substitution for and upon cancellation of the mutilated Bond or in lieu of and in substitution for a Bond destroyed, stolen or lost, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a Bond destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that the Bond was destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance and amount satisfactory to it and as provided by law, in which both the City and the Registrar must be named as obligees. Bonds so surrendered to the Registrar will be cancelled by the Registrar and evidence of such cancellation must be given to the City. If the mutilated, destroyed, stolen or lost Bond has already matured or been called for redemption in accordance with its terms it is not necessary to issue a new Bond prior to payment. (i) Redemption. In the event any of the Bonds are called for redemption, notice thereof identifying the Bonds to be redeemed will be given by the Registrar by mailing a copy of the redemption notice by first class mail (postage prepaid) to the registered owner of each Bond to be redeemed at the address shown on the registration books kept by the Registrar and by publishing the notice if required by law. Failure to give notice by publication or by mail to registered owners, or any defect therein, will not affect the validity of the proceedings for the redemption of Bonds. Bonds so called for redemption will cease to bear interest after the specified redemption date, provided that the funds for the redemption are on deposit with the place of payment at that time. 2.04. Appointment of Initial Registrar. The City appoints U.S. Bank National Association, St. Paul, Minnesota as the initial Registrar. The Mayor and the City Clerk are authorized to execute and deliver, on behalf of the City, a contract with the Registrar. Upon merger or consolidation of the Registrar with another corporation, if the resulting corporation is a bank or trust company authorized by law to conduct such business, the resulting corporation is authorized to act as successor Registrar. The City agrees to pay the reasonable and customary charges of the Registrar for the services performed. The City reserves the right to remove the Registrar upon 30 days'notice and upon the appointment of a successor Registrar, in which event the predecessor Registrar must 445655v4 JSB EL 185-27 4 deliver all cash and Bonds in its possession to the successor Registrar and must deliver the bond register to the successor Registrar. On or before each principal or interest due date,without further order of this Council, the City Finance Director must transmit to the Registrar moneys sufficient for the payment of all principal and interest then due. 2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the direction of the City Clerk and executed on behalf of the City by the signatures of the Mayor and the City Clerk,provided that those signatures may be printed, engraved or lithographed facsimiles of the originals. If an officer whose signature or a facsimile of whose signature appears on the Bonds ceases to be such officer before the delivery of a Bond, that signature or facsimile will nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in office until delivery. Notwithstanding such execution, a Bond will not be valid or obligatory for any purpose or entitled to any security or benefit under this Resolution unless and until a certificate of authentication on the Bond has been duly executed by the manual signature of an authorized representative of the Registrar. Certificates of authentication on different Bonds need not be signed by the same representative. The executed certificate of authentication on a Bond is conclusive evidence that it has been authenticated and delivered under this Resolution. When the Bonds have been so prepared, executed and authenticated, the City Clerk will deliver the same to the Purchaser upon payment of the purchase price in accordance with the contract of sale heretofore made and executed, and the Purchaser is not obligated to see to the application of the purchase price. 2.06. Temporary Bonds. The City may elect to deliver in lieu of printed definitive Bonds one or more typewritten temporary Bonds in substantially the form set forth in EXHIBIT B attached hereto with such changes as may be necessary to reflect more than one maturity in a single temporary bond. Upon the execution and delivery of definitive Bonds the temporary Bonds will be exchanged therefor and cancelled. Section 3. Form of Bond. 3.01. Execution of Bonds. The Bonds will be printed or typewritten in substantially the form attached hereto as EXHIBIT B. 3.02. Approving Legal Opinion. The City Finance Director will obtain a copy of the proposed approving legal opinion of Kennedy& Graven, Chartered,Minneapolis,Minnesota,which will be complete except as to dating thereof and will cause the opinion to be printed on or accompany each Bond. Section 4. Payment: Security: Pledges and Covenants. 4.01. Debt Service Fund. (a) The City will continue to operate its Sewer Fund to which will be credited all gross revenues of the sewer plant and system and out of which will be paid all normal and reasonable expenses of current operations of the sewer plant and system. Any balances therein are deemed "Net Revenues" and will be transferred, from time to time, to a General Obligation Sewer Revenue Bonds, Series 2014B Debt Service Fund (the "Debt Service Fund") hereby created, which fund will be used only to pay principal of and interest on the Bonds and any other bonds similarly authorized. There will always be retained in the Debt Service Fund a sufficient amount to pay principal of and interest on all the Bonds, and the City Finance Director must report any current or anticipated deficiency in the Debt Service Fund to the City Council. There is 445655v4 JSB EL 185-27 5 appropriated to the Debt Service Fund (i) capitalized interest financed from Bond proceeds, if any; (ii) any amount over the minimum purchase price of the Bonds paid by the Purchaser, to the extent designated for deposit in the Debt Service Fund in accordance with Section 1.03; and (iii) the accrued interest paid by the Purchaser upon closing and delivery of the Bonds,if any. 4.02. Construction Fund. The proceeds of the Bonds, less the appropriations made in Section 4.01, together with any other funds appropriated during the construction of the Project financed by the Bonds,will be deposited in a separate construction fund (the "Construction Fund") maintained by the City to be used solely to defray expenses of the Project and the payment of principal and interest on the Bonds prior to the completion and payment of all costs of the Project. When the Project is completed and the cost thereof paid, the Construction Fund is to be closed and any balance therein is to be deposited in the Debt Service Fund. 4.03. City Covenants. The City Council covenants and agrees with the holders of the Bonds that so long as any of the Bonds remain outstanding and unpaid, they will keep and enforce the following covenants and agreements: (a) The City will continue to maintain and efficiently operate the sewer plant and system as a public utility and convenience free from competition of other like municipal utilities and will cause all revenues therefrom to be deposited in bank accounts and credited to the sewer system account as hereinabove provided, and will make no expenditures from such account except for a duly authorized purpose and in accordance with this resolution. (b) The City will also maintain the Debt Service Fund as a separate account in the Sewer Fund and will cause money to be credited thereto from time to time, out of net revenues from the sewer plant and system in sums sufficient to pay principal of and interest on the Bonds when due. (c) The City will keep and maintain proper and adequate books of records and accounts separate from all other records of the City in which will be complete and correct entries as to all transactions relating to the sewer plant and system and which will be open to inspection and copying by any bondholder, or the bondholder's agent or attorney, at any reasonable time, and it will furnish certified transcripts therefrom upon request and upon payment of a reasonable fee therefor, and said account will be audited at least annually by a qualified public accountant and statements of such audit and report will be furnished to all bondholders upon request. (d) The City Council will cause persons handling revenues of the sewer plant and system to be bonded in reasonable amounts for the protection of the City and the bondholders and will cause the funds collected on account of the operations of the sewer plant and system to be deposited in a bank whose deposits are guaranteed under the Federal Deposit Insurance Law. (e) The Council will keep the sewer plant and system insured at all times against loss by fire, tornado and other risks customarily insured against with an insurer or insurers in good standing,in such amounts as are customary for like plants, to protect the holders, from time to time, of the Bonds and the City from any loss due to any such casualty and will apply the proceeds of such insurance to make good any such loss. 445655v4 JSB EL 185-27 6 (f) The City and each and all of its officers will punctually perform all duties with reference to the sewer plant and system as required by law. (g) The City will impose and collect charges of the nature authorized by Minnesota Statutes, Section 444.075 at the times and in the amounts required to produce, net revenues adequate to pay all principal and interest when due on the Bonds and to create and maintain such reserves securing said payments as may be provided in this resolution. (h) The City Council will levy general ad valorem taxes on all taxable property in the City,when required to meet any deficiency in net revenues. 4.04. Net Revenue Pledge. It is hereby determined that the estimated collection of Net Revenues from the sewer system for the payment of principal of and interest on the Bonds will produce at least five percent in excess of the amount needed to meet, when due, the principal and interest payments on the Bonds and that no tax levy is needed at this time. 4.05. Certificate of County Auditor as to Registration. The City Clerk is authorized and directed to file a certified copy of this resolution with the County Auditor of Sherburne County, Minnesota, and to obtain the certificate required by Section 475.63 of the Act. Section 5. Authentication of Transcript. 5.01. City Proceedings and Records. The officers of the City are authorized and directed to prepare and furnish to the Purchaser and to the attorneys approving the Bonds, certified copies of proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the City, and such other certificates, affidavits and transcripts as may be required to show the facts within their knowledge or as shown by the books and records in their custody and under their control, relating to the validity and marketability of the Bonds, and such instruments,including any heretofore furnished,will be deemed representations of the City as to the facts stated therein. 5.02. Certification as to Official Statement. The Mayor, City Clerk and Finance Director of the City are authorized and directed to certify that they have examined the Official Statement prepared and circulated in connection with the issuance and sale of the Bonds and that to the best of their knowledge and belief the Official Statement is a complete and accurate representation of the facts and representations made therein as of the date of the Official Statement. 5.03. Other Certificates. The Mayor, City Clerk and Finance Director are hereby authorized and directed to furnish to the Purchaser at the closing such certificates as are required as a condition of sale. Unless litigation shall have been commenced and be pending questioning the Bonds or the organization of the City or incumbency of its officers,at the closing the Mayor and the City Clerk shall also execute and deliver to the Purchaser a suitable certificate as to absence of material litigation, and the Clerk shall also execute and deliver a certificate as to payment for and delivery of the Bonds. Section 6. Tax Covenant. 445655v4 JSB EL 185-27 7 6.01. Tax-Exempt Bonds. The City 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. 6.02. Rebate. The City will comply with requirements necessary under the Code to establish and maintain the exclusion from gross income of the interest on the Bond 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. 6.03. Not Private Activity Bonds. The City further covenants not to use the proceeds of the Bonds or to cause or permit them or any of them to be used, in such a manner as to cause the Bonds to be "private activity bonds"within the meaning of Sections 103 and 141 through 150 of the Code. 6.04. 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 City makes the following factual statements and representations: (a) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; (b) the City designates the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Code; (c) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds which are not qualified 501(c)(3) bonds) which will be issued by the City (and all subordinate entities of the City) during calendar year 2014 will not exceed $10,000,000;and (d) not more than $10,000,000 of obligations issued by the City during calendar year 2014 have been designated for purposes of Section 265(b)(3) of the Code. 6.05. Procedural Requirements. The City will use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designations made by this section. Section 7. Book-EntrySystem;Limited Obligation of City. 7.01. DTC. The Bonds will be initially issued in the form of a separate single typewritten or printed fully registered Bond for each of the maturities set forth in Section 1.04 hereof. Upon initial issuance, the ownership of each Bond will be registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee for The Depository Trust Company, New York, 445655v4 JSB EL 185-27 8 New York, and its successors and assigns ("DTC"). Except as provided in this section, all of the outstanding Bonds will be registered in the registration books kept by the Registrar in the name of Cede& Co., as nominee of DTC. 7.02. Participants. With respect to Bonds registered in the registration books kept by the Registrar in the name of Cede & Co., as nominee of DTC, the City, the Registrar and the Paying Agent will have no responsibility or obligation to any broker dealers, banks and other financial institutions from time to time for which DTC holds Bonds as securities depository (the "Participants") or to any other person on behalf of which a Participant holds an interest in the Bonds,including but not limited to any responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any Participant or any other person (other than a registered owner of Bonds, as shown by the registration books kept by the Registrar), of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any Participant or any other person, other than a registered owner of Bonds, of any amount with respect to principal of, premium, if any, or interest on the Bonds. The City, the Registrar and the Paying Agent may treat and consider the person in whose name each Bond is registered in the registration books kept by the Registrar as the holder and absolute owner of such Bond for the purpose of payment of principal, premium and interest with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes. The Paying Agent will pay all principal of, premium, if any, and interest on the Bonds only to or on the order of the respective registered owners, as shown in the registration books kept by the Registrar, and all such payments will be valid and effectual to fully satisfy and discharge the City's obligations with respect to payment of principal of, premium, if any, or interest on the Bonds to the extent of the sum or sums so paid. No person other than a registered owner of Bonds, as shown in the registration books kept by the Registrar, will receive a certificated Bond evidencing the obligation of this resolution. Upon delivery by DTC to the City Finance Director of a written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., the words "Cede & Co." will refer to such new nominee of DTC; and upon receipt of such a notice, the City Finance Director will promptly deliver a copy of the same to the Registrar and Paying Agent. 7.03. Representation Letter. The City has heretofore executed and delivered to DTC a Blanket Issuer Letter of Representations (the "Representation Letter") which shall govern payment of principal of, premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any Paying Agent or Registrar subsequently appointed by the City with respect to the Bonds will agree to take all action necessary for all representations of the City in the Representation Letter with respect to the Registrar and Paying Agent,respectively,to be complied with at all times. 7.04. Transfers Outside Book-EntryS,sT e. In the event the City, by resolution of the City Council, determines that it is in the best interests of the persons having beneficial interests in the Bonds that they be able to obtain Bond certificate, the City will notify DTC, whereupon DTC will notify the Participants, of the availability through DTC of Bond certificates. In such event the City will issue, transfer and exchange Bond certificates as requested by DTC and any other registered owner in accordance with the provisions of this Resolution. DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving notice to the City and discharging its responsibilities with respect thereto under applicable law. In such event, if no successor securities depository is appointed, the City will issue and the Registrar will authenticate 445655v4 JSB EL 185-27 9 Bond certificates in accordance with this resolution and the provisions hereof will apply to the transfer, exchange and method of payment thereof. 7.05. Payments to Cede & Co. Notwithstanding any other provision of this resolution to the contrary, so long as a Bond is registered in the name of Cede & Co., as nominee of DTC, payments with respect to principal of,premium,if any, and interest on the Bond and all notices with respect to the Bond will be made and given, respectively in the manner provided in DTC's Operational Arrangements, as set forth in the Representation Letter. Section 8. Continuing Disclosure. 8.01. 013L Co=liance with Provisions of Continuing Disclosure Certificate. The City hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Certificate. Notwithstanding any other provision of this Resolution, failure of the City to comply with the Continuing Disclosure Certificate will not be considered an event of default with respect to the Bonds; however, any Bondholder may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this section. 8.02. Execution of Continuing Disclosure Certificate. "Continuing Disclosure Certificate" means that certain Continuing Disclosure Certificate executed by the Mayor and the City Clerk and dated the date of issuance and delivery of the Bonds, as originally executed and as it may be amended from time to time in accordance with the terms thereof. Section 9. Defeasance. When all Bonds and all interest thereon have been discharged as provided in this section, all pledges, covenants and other rights granted by this resolution to the holders of the Bonds will cease, except that the pledge of the full faith and credit of the City for the prompt and full payment of the principal of and interest on the Bonds will remain in full force and effect. The City may discharge all Bonds which are due on any date by depositing with the Registrar on or before that date a sum sufficient for the payment thereof in full. If any Bond should not be paid when due,it may nevertheless be discharged by depositing with the Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit Passed and adopted this 21st day of July,2014. John J. Dietz,Mayor ATTEST: Tina Allard, City Clerk 445655v4 JSB EL 185-27 10 EXHIBIT A PROPOSALS Springsted Incorpar-Aed 360 Jackson Stroct, Suitc 300 Saint Paul,MN 55101-7887 Springsted Tel 651-223000 Fax 851-223-M02 Email: adaisors @springsted.cam www.spdngsted.com $10,000,0001x1 CITY OF ELK RIVER,MINNESOTA GENERAL OBLIGATION SEWER REVENUE BONDS,SERIES 20146 (BOOK ENTRY ONLY) AWARD: FTN FINANCIAL CAPITAL MARKETS SALE: July21,2014 Standard&Poor's Rating: AA+ Interest Met Interest True Interest Bidder Rates Price cost Rate FTN FINANCIAL CAPITAL MARKETS 2.00% 2016-2022 $10,036,650.05(b) $3,548,149.28(0 2.969979%tb1 2.50% 2023-2025 2.75% 2026 3.00% 2027-2029 3.25%m 2030 3.40%4 2031-2034 3.50% 2035 WELLS FARGO BANK, 3.00% 2015 $10,196.819.50 $3,560,429.94 2.9730% NATIONAL ASSOCIATION 4.00% 2017-2019 3.00% 2020-2022 2.50% 2023-2024 3.00°,6 2025-2029 3.25% 2030 3.30% 2031-2034 3.50% 2035 PIPER JAFFRAY&CO. 200% 2016-2017 $10,170,028.10 $3,576,079.96 2.9798 3.D0°fo 2018-2022 2.50% 2023-2025 3.00010 2026-2028 3.25% 2029 3.375% 2030 3.40% 2031-2034 3.50% 2035 �8] Subsequent to bid opening,the total issue size was not changed.however,certain individual maturity amounts have changed. [bJ Subsequent to bid opening, the price,net ingest cost and true interest rate have changed to$10.036,220.65,$3.552,511.02.and 2.969974%,respectively. Public Sector Advisors 445655v4JSB EL185-27 A_1 Interest Net Interest True Interest Bidder Rates Price Cost Rate RAYMOND JAMES&ASSOCIATES,.INC. 200% 2016-2022 $10,101,278.65 $3,603,740.52 2.9997% 2.25% 2023 2.50% 2024 2.75% 2025 3.00% 2026-2027 3.25% 2028-2030 3.40% 2031-2034 4.00% 2035 STIFEL,NICOLAUS&COMPANY, 2.00% 2016-2021 $10,129,042.35 $3,621,494.87 3.0178% INCORPORATED 300% 2022-2028 3.25% 2029-2030 3.40% 2031-2034 3.75% 2035 SUNTRUST ROBINSON HUMPHREY, INC. 2.00% 2016-2020 $10,138;794.30 $3,641,879.03 3.0276% STERNE,AGEE&LEACH, INC. 2.50% 2021-2024 BANK OF OKLAHOMA 3.00% 2025-2028 3.50% 2029-2030 3.40% 2031-2034 4,00% 2035 ROBERT W. BAIRD&COMPANY, 2.470% 2016-2021 $10,061,114.95 $3,615,569.49 3.0290% INCORPORATED 300% 2022-2030 C.L. KING&ASSOCIATES 3.40% 2031-2034 COASTAL SECURITIES L.P. 3.50% 2035 SAMCO CAPITAL MARKETS, INC. EDWARD D.JONES&COMPANY WNJ CAPITAL CRONIN&COMPANY, INC. VINING-SPARKS IBG, LIMITED PARTNERSHIP LOOP CAPITAL MARKETS,LLC CLEWS&ASSOCIATES CASTLEOAK SECURITIES,L.P. DAVENPORT&COMPANY LLC ROSS,SINCLAIRE&ASSOCIATES,LLC DUNCAN-WILLIAMS, INC. DOUGHERTY&COMPANY LLC ISAAK BOND INVESTMENTS,INC. OPPENHEIMER&CC. INC. BERNARDI SECURITIES, INCORPORATED SUNRIDGE PARTNERS COUNTRY CLUB BANK NORTHLAND SECURITIES,INC. 2.00% 2016-2021 $10,062;451.70 $3,710,063.58 31036% 2.50% 2022 2.75% 2023 3.00% 2024-2027 3.25% 2028-2029 3.50% 2030-2035 445655v4 JSB EL185-27 A-2 ------------------------------------------------------------------------------------------------------------------------------------------------------- REOFFERING SCHEDULE OF THE PURCHASER Rate Year Yield 2.00% 2016 0.40% 2.00% 2017 0.65% 2.00% 2016 1.00% 2.00% 2019 1.30% 2.00% 2020 1.60% 200% 2021 1.8 % 2.00% 2022 Par 2.50% 2023 210% 2.50% 2024 2.25% 2.50% 2025 2.40% 2,75% 2026 2,60% 3.00% 2027 2.80% 3.00% 2028 2.90% 3.00% 2029 Par 3.25% 2030 3.10% 3.40% 2031 Par 3.40% 2032 Par 3.40% 2033 Par 3.40% 2034 Par 3.50% 2035 3.55% BBI- 4.35% Average Maturity 11.793 Years 445655v4 JSB EL185-27 A-3 EXHIBIT B FORM OF BOND No. R- UNITED STATES OF AMERICA $ STATE OF MINNESOTA COUNTY OF SHERBURNE CITY OF ELK RIVER CITY OF ELK RIVER,MINNESOTA GENERAL OBLIGATION SEWER REVENUE BOND SERIES 2014B Date of Rate MatuL4 Original Issue CUSIP February 1, 20_ August 21,2014 Registered Owner: Cede& Co. The City of Elk River, Minnesota, a duly organized and existing municipal corporation in Sherburne County,Minnesota (the "City"),acknowledges itself to be indebted and for value received hereby promises to pay to the Registered Owner specified above or registered assigns, the principal sum of $ on the maturity date specified above, with interest thereon from the date hereof at the annual rate specified above, payable February 1 and August 1 in each year, commencing February 1,2015, to the person in whose name this Bond is registered at the close of business on the fifteenth day (whether or not a business day) of the immediately preceding month. The interest hereon and, upon presentation and surrender hereof, the principal hereof are payable in lawful money of the United States of America by check or draft by U.S. Bank National Association, St. Paul, Minnesota, as Registrar, Paying Agent, Transfer Agent and Authenticating Agent, or its designated successor under the Resolution described herein. For the prompt and full payment of such principal and interest as the same respectively become due, the full faith and credit and taxing powers of the City have been and are hereby irrevocably pledged. The City may elect on February 1, 2022, and on any day thereafter to prepay Bonds due on or after February 1,2023. Redemption may be in whole or in part and if in part, at the option of the City and in such manner as the City will determine. If less than all Bonds of a maturity are called for redemption, the City will notify The Depository Trust Company ("DTC") of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. Prepayments will be at a price of par plus accrued interest. The Bonds maturing in the year 2034 are subject to mandatory sinking fund redemption on February 1 of the following years in the following principal amounts: 445655v4 JSB EL 185-27 B-l Year Principal Amount 2031 $570,000 2032 585,000 2033 610,000 2034* 630,000 * Maturity The principal amounts of the Bonds subject to mandatory sinking fund redemption on any date may be reduced through earlier optional redemptions, with any partial redemptions of such Bonds credited against future mandatory sinking fund redemptions of such Bonds in such order as the City shall determine. The City Council has designated the issue of Bonds of which this Bond forms a part as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code") relating to disallowance of interest expense for financial institutions and within the $10 million limit allowed by the Code for the calendar year of issue. This Bond is one of an issue in the aggregate principal amount of $10,000,000 all of like original issue date and tenor, except as to number, maturity date, amount, redemption privilege, and interest rate, all issued pursuant to a resolution adopted by the City Council on July 21, 2014 (the"Resolution"), for the purpose of providing money to aid in financing a wastewater facility improvement project,pursuant to and in full conformity with the Constitution, and laws of the State of Minnesota including Minnesota Statutes, Section 444.075, and Minnesota Statutes, Chapter 475, as amended. The principal of and interest on the Bonds of this issue are payable primarily from net revenues of the sewer plant and system of the City in a special debt service fund of the City, as set forth in the Resolution to which reference is made for a full statement of rights and powers thereby conferred. The full faith and credit of the City are irrevocably pledged for payment of this Bond and the City Council has obligated itself to levy ad valorem taxes on all taxable property in the City in the event of any deficiency in net revenues pledged, which taxes may be levied without limitation as to rate or amount. The Bonds of this series are issued only as fully registered Bonds in denominations of$5,000 or any integral multiple thereof of single maturities. IT IS HEREBY CERTIFIED AND RECITED That in and by the Resolution, the City has covenanted and agreed that it will continue to own and operate the sewer plant and system free from competition by other like municipal utilities; that adequate insurance on said plant and system and suitable fidelity bonds on employees will be carried; that proper and adequate books of account will be kept showing all receipts and disbursements relating to the Sewer Fund,into which it will pay all of the gross revenues from the sewer plant and system; that it will also create and maintain a General Obligation Sewer Revenue Bonds, Series 2014B Debt Service Fund, into which it will pay, out of the net revenues from the sewer system a sum sufficient to pay principal hereof and interest thereon when due; and that it will provide, by ad valorem tax levies, for any deficiency in required net sewer system revenues. 445655v4 JSB EL185-27 B-2 As provided in the Resolution and subject to certain limitations set forth therein, this Bond is transferable upon the books of the City at the principal office of the Registrar, by the registered owner hereof in person or by the owner's attorney duly authorized in writing upon surrender hereof together with a written instrument of transfer satisfactory to the Registrar, duly executed by the registered owner or the owner's attorney; and may also be surrendered in exchange for Bonds of other authorized denominations. Upon such transfer or exchange the City will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of the same aggregate principal amount, bearing interest at the same rate and maturing on the same date, subject to reimbursement for any tax, fee or governmental charge required to be paid with respect to such transfer or exchange. The City and the Registrar may deem and treat the person in whose name this Bond is registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of receiving payment and for all other purposes, and neither the City nor the Registrar will be affected by any notice to the contrary. IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be performed preliminary to and in the issuance of this Bond in order to make it a valid and binding general obligation of the City in accordance with its terms, have been done, do exist, have happened and have been performed as so required, and that the issuance of this Bond does not cause the indebtedness of the City to exceed any constitutional or statutory limitation of indebtedness. This Bond is not valid or obligatory for any purpose or entitled to any security or benefit under the Resolution until the Certificate of Authentication hereon has been executed by the Registrar by manual signature of one of its authorized representatives. IN WITNESS WHEREOF, the City of Elk River, Minnesota, by its City Council, has caused this Bond to be executed on its behalf by the facsimile or manual signatures of the Mayor and City Clerk and has caused this Bond to be dated as of the date set forth below. Dated: August 21,2014 CITY OF ELK RIVER, MINNESOTA (Facsimile) (Facsimile) Mayor City Clerk 445655v4 JSB EL185-27 B-3 CERTIFICATE OF AUTHENTICATION This is one of the Bonds delivered pursuant to the Resolution mentioned within. U.S. BANK NATIONAL ASSOCIATION By Authorized Representative ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this Bond, will be construed as though they were written out in full according to applicable laws or regulations: TEN COM -- as tenants in common UNIF GIFT MIN ACT Custodian (Cust) (Minor) TEN ENT -- as tenants by entireties under Uniform Gifts or Transfers to Minors Act, State of JT TEN -- as joint tenants with right of survivorship and not as tenants in common 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 all rights thereunder, and does hereby irrevocably constitute and appoint attorney to transfer the said Bond on the books kept for registration of the within Bond,with full power of substitution in the premises. Dated: Notice: The assignor's signature to this assignment must correspond with the name as it appears upon the face of the within Bond in every particular, without alteration or any change whatever. 445655v4JSB EL185-27 B-4 Signature Guaranteed: NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the Securities Transfer Agent Medallion Program ("STAMP"), the Stock Exchange Medallion Program ("SEMP"), the New York Stock Exchange, Inc. Medallion Signatures Program ("MSP") or other such "signature guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, SEMP or MSP, all in accordance with the Securities Exchange Act of 1934,as amended. The Registrar will not effect transfer of this Bond unless the information concerning the assignee requested below is provided. Name and Address: (Include information for all joint owners if this Bond is held by joint account.) Please insert social security or other identifying number of assignee PROVISIONS AS TO REGISTRATION The ownership of the principal of and interest on the within Bond has been registered on the books of the Registrar in the name of the person last noted below. Signature of Date of Registration Registered Owner Officer of Registrar Cede& Co. Federal ID #13-2555119 445655v4 JSB EL185-27 B-5 +J 00 to N I� M M CU m (Sn co O 3' (Sn 4 N I� Ill 61 I� to to O O i' co n O H co O to co r-i r-I n O 'l+ to I� O N IZI' 1-1 1--1 n n n to to 0 o I� M M M M M M M M �-I 0 0 0 0 0 0 0 0 (o 0 0 0 0 0 0 0 0 C14 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ri ri ri ri ri ri ri ri V)- V)- V)- � � � � � u o\° o\° o\° o\° o\° o\° o\° o\° H CO I� 11' to to I� r1 co -3' co m -3' m 31 n N O 1-1 CU 11' 61 CU I� O I� 1-1 M co co 1-1 co O co m N n O co n to O r1 co n I� co to 0 0 0 0 0 0 0 r1 M M M M M M M M N U W u o\° o\° o\° o\° o\° o\° o\° o\° as O 'l' t` to N to H H 61 to co N to O to I� b) O I� O zi' n I` n co zi' C. N m O co co to O to rl 61 M 61 61 I� t` 61 M �-I U) to I� I� m r1 N N O N N 6 6 6 6 0 0 0 r1 4--I (q 4-� 4-) O N co I� M -1 O N 3' co 3' 3' O m O O to I� 1-1 1-1 O O O M to O co O to .� CO N CO O O N O to O co to O 61 O I� H N co, M M N r1 O N r1 O r1 r-I O O O O .H r-I .� O O O O O O O O O O O O O O O O 61 O +) (0 ri rn w (o +� H U P4 O N (1) + (DO fCj 'J 4-) a' H H 4-� o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° O n N 4-) N N U (C 4-� O (Sn 0 0 0 0 0 0 (Sn 0 0 0 0 0 0 0 (Sn 'r1 1-1 O f4 �^ rl U1 U -1 0 3+ to O co to m O —i N 3' to m 61 O —i v n 4-) O (DO U) •• �I N H N �". U U N N �-1 b) 4-1 �-I H G�. (� O O r1 r1 r1 r1 N N N N N N N M co co M N F O CO H (0 ri ri 3 -r-I H H Q4 O O O (DO H (1) +) -1 +) U o �! ' ro (0 ro O U P O m w N n as 4--1 ,7 U) ,T, u O H O r1 (Sn -r1 U) Q .H z N N •• O CO �1 O U) 04 ' r� �u +� H 0 U1 N v� N r - X U1 O r1 Gy O o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° o\° _ r1 � � U Q5 � U) 040 O O O O O O O O O n O O O n O O � N H (0 0 (0 (0 �5 O O o O O O O n n n t` O O O N a+ n o O Ln t9 fx b) O rl W U� r r r I - U Ul O � m N � U� .� Qa O O N •r, U N N N N N. N N N N N. N M co co co co M N �^ r-I -r1 O �-1 �j U O PQ cn r1 •• (o O co �-1 r-I ,Q Lz5 U b) 4-� (0 -r1 fx $4 � N Q Q4 O N w O F! �4 4-� h -0 N to N 61 0 r-I N co j' n to CLU of 0 1' n +) �5 , +) -0 (0 (0 i5 �.' r1 r1 r1 r1 N N N N N N N N N N M M M -0 (o O O 4- r-I �-4 C a h -0 . U) (0 +) O O O O O O O O O O O O O O O O O N q �-4 U r-I H O (0 (0 r S r-I �5 4-) -1 r1 N N N N N N N N N N N N N N N N N r1 N U} -0 [u U) �-4 O 0 �-4 �-4 � 3 �-4 -- -- -- -- -- -- -, -, -, -, .H -0 �> +) 1-1 -1 0 �! 4-I H 0 4-) �5 1-1 1--1 1-1 1--1 1-1 1--1 1-1 1--1 1-1 1--1 r1 r1 r1 r1 r1 r1 r1 (0 N -r1 U) •• (0 +) Q r-I Q4 >1-r1 F Q �-4 N +) OOOOOOOOOOOOOOOOO +) 4-) -1 �-4 '0 +) -r1 N +) H H N -r1 (0 +) �5 O O N (o N -r1 -r1 O U 0 M W 44 ri : as Qa U) U? f4 '7-i H " N N N N N N N N N N N N N N N N N Q Q Q Cia W P 11-d G Springsted Incorporated 380 Jackson Street, Suite 300 �1 S p r i n g s t e d Saint Paul,MN 55101-2887 Tel: 651-223-3000 Fax: 651-223-3002 Emaii: advisors @springsted.com www,springsled.com $10,000,000(a) CITY OF ELK RIVER, MINNESOTA GENERAL OBLIGATION SEWER REVENUE BONDS, SERIES 2014B (BOOK ENTRY ONLY) AWARD: FTN FINANCIAL CAPITAL MARKETS SALE: July 21, 2014 Standard & Poor's Rating: AA+ Interest Net Interest True Interest Bidder Rates Price Cost Rate FTN FINANCIAL CAPITAL MARKETS 2.00% 2016-2022 $10,036,650.05(b) $3,548,148.28(b) 2,969979%(b) Z50% 2023-2025 2.75% 2026 3.00% 2027-2029 3.25% 2030 3.40% 2031-2034 3.50% 2035 WELLS FARGO BANK, 3.00% 2016 $10,196,819.50 $3,560,429.94 2.9730% NATIONAL ASSOCIATION 4.00% 2017-2019 3.00% 2020-2022 2.50% 2023-2024 3.00% 2025-2029 3.25% 2030 3.30% 2031-2034 3.50% 2035 PIPER JAFFRAY & CO. 2.00% 2016.2017 $10,170,028.10 $3,576,079.96 2.9798 3.00% 2018-2022 2.50% 2023-2025 3.00% 2026-2028 3.25% 2029 3.375% 2030 3.40% 2031-2034 3.50% 2035 (a) Subsequent to bid opening, the total issue size was not changed;however, certain individual maturity amounts have changed. (b) Subsequent to bid opening, the price, net interest cost and true interest rate have changed to$10,036,220.65, $3,552,511.02, and 2.969974%, respectively. Public Sector Advisors Interest Net Interest True Interest Bidder Rates Price Cost Rate RAYMOND JAMES &ASSOCIATES, INC. 2.00% 2016-2022 $10,101,278.65 $3,603,740.52 2.9997% 2.25% 2023 2.50% 2024 2.75% 2025 3.00% 2026-2027 3.25% 2028-2030 3.40% 2031-2034 4.00% 2035 STIFEL, NICOLAUS & COMPANY, 2.00% 2016-2021 $10,129,042.35 $3,621,494.87 3.0178% INCORPORATED 3.00% 2022-2028 3.25% 2029-2030 3.40% 2031-2034 3.75% 2035 SUNTRUST ROBINSON HUMPHREY, INC. 2.00% 2016-2020 $10,138,794.30 $3,641,879.03 3.0276% STERNE, AGEE & LEACH, INC. 2.50% 2021-2024 BANK OF OKLAHOMA 3.00% 2025-2028 3.50% 2029-2030 3.40% 2031-2034 4.00% 2035 ROBERT W. BAIRD & COMPANY, 2.00% 2016-2021 $10,061,114.95 $3,615,569.49 3.0290% INCORPORATED 3.00% 2022-2030 C.L. KING & ASSOCIATES 3.40% 2031-2034 COASTAL SECURITIES L.P. 3.50% 2035 SAMCO CAPITAL MARKETS, INC. EDWARD D, JONES & COMPANY WNJ CAPITAL CRONIN & COMPANY, INC. VINING-SPARKS IBG, LIMITED PARTNERSHIP LOOP CAPITAL MARKETS, LLC CREWS &ASSOCIATES CASTLEOAK SECURITIES, L.P. DAVENPORT & COMPANY LLC ROSS, SINCLAIRE & ASSOCIATES, LLC DUNCAN-WILLIAMS, INC. DOUGHERTY & COMPANY LLC ISAAK BOND INVESTMENTS, INC. OPPENHEIMER & CO. INC. BERNARDI SECURITIES, INCORPORATED SUNRIDGE PARTNERS COUNTRY CLUB BANK NORTHLAND SECURITIES, INC. 2.00% 2016-2021 $10,062,451.70 $3,710,063.58 3.1036% 2.50% 2022 2.75% 2023 3.00% 2024-2027 3,25% 2028-2029 3.50% 2030-2035 REOFFERING SCHEDULE OF THE PURCHASER Rate Year Yield 2.00% 2016 0.40% 2.00% 2017 0.65% 2.00% 2018 1.00% 2.00% 2019 1.30% 2.00% 2020 1.60% 2.00% 2021 1.80% 2.00% 2022 Par 2.50% 2023 2.10% 2.50% 2024 2.25% 2.50% 2025 2.40% 2.75% 2026 2.60% 3.00% 2027 2.80% 3.00% 2028 2.90%v 3.00% 2029 Par 3.25% 2030 3.10% 3.40% 2031 Par 3.40% 2032 Par 3.40% 2033 Par 3.40% 2034 Per 3.50% 2035 3.55% BBI: 4.36% Average Maturity: 11.793 Years