HomeMy WebLinkAboutResolution - 2002-188 - Sale of $2,710,000 General Obligation Refunding Bonds, 1992C Bonds, Series 2003B - 12/17/2002 CITY OF EDEN PRAIRIE;
HENNEPIN COUNTY,AHNNESOTA
RESOLUTION 2002-188
RESOLUTION PRESCRIBING THE FORM AND DETAILS
AND PROVIDING FOR THE PAYMENT OF$2,710,000
GENERAL OBLIGATION REFUNDING BONDS, SERIES 2003B
BE IT RESOLVED by the City Council of the City of Eden Prairie, Minnesota
(the Issuer), as follows:
Section 1. Authorization and Sale.
1.01. Authorization. This Council hereby determines that it is in the best
interests of the City to issue its General Obligation Refunding Bonds, Series 2003B (the Bonds)
in the approximate principal amount of$2,710,000, subject to adjustment in accordance with the
Terms of Proposal. The Issuer believes that a substantial debt service savings can be achieved
by the issuance and sale of the Bonds. The proceeds of the Bonds will be used, together with
funds on hand as may be required,to refund on February 1, 2003 (the Redemption Date), the
2004 through 2008 maturities, aggregating$2,665,000 in principal amount outstanding, of the
$6,735,000 General Obligation Water and Sewer Refunding Bonds, Series 1993C, dated May 1,
1993 (the Refunded Bonds).
1.02. Sale. Pursuant to the Terms of Proposal and the Official Statement
prepared on behalf of the Issuer by Northland Securities, Inc., sealed proposals for the purchase
of the Bonds were received at or before the time specified for receipt of proposals. The
proposals have been opened, publicly read and considered and the purchase price, interest rates
and net interest cost under the terms of each proposal have been determined. The most favorable
proposal received is that of of
and associates (the Purchaser). In accordance with the
Terms of Proposal, it is hereby determined to issue the Bonds in the principal amount of
$2,710,000 at a price of$ plus accrued interest, and upon the further terms
and conditions set forth herein.
1.03. Award. The sale of the Bonds is hereby awarded to the Purchaser and the
Mayor and City Manager are hereby authorized and directed to execute a contract on behalf of
the Issuer for the sale of the Bonds in accordance with the terms of the proposal. The good faith
deposit of the Purchaser shall be retained and deposited by the Issuer until the Bonds have been
delivered, and shall be deducted from the purchase price paid at settlement.
Section 2. Bond Terms; Registration; Execution and Delivery.
2.01. Issuance of Bonds. All acts, conditions and things which are required by
the Constitution and laws of the State of Minnesota to be done, to exist,to happen and to be
performed precedent to and in the valid issuance of the Bonds having been done,now existing,
having happened and having been performed,it is now necessary for the City Council to
establish the form and terms of the Bonds,to provide security therefor and to issue the Bonds
forthwith.
2.02. Maturities; Interest Rates; Denominations and Pa event,. The Bonds shall
be originally dated as of January 1,2003, shall be in the denomination of$5,000 each, or any
integral multiple thereof, of single maturities, shall mature on February 1 in the years and
amounts stated below, and shall bear interest from date of issue until paid at the annual rates set
forth opposite such years and amounts, as follows:
Year Amount Rate
2004 $565,000 %
2005 575,000
2006 570,000
2007 595,000
2008 405,000
[REVISE MATURITY SCHEDULE FOR ANY TERM BONDS]
The Bonds shall be issuable only in fully registered form. The interest thereon and, upon
surrender of each Bond,the principal amount thereof shall be payable by check or draft issued by
the Registrar described herein; provided that, so long as the Bonds are registered in the name of a
securities depository, or a nominee thereof, in accordance with Section 2.08 hereof,principal and
interest shall be payable in accordance with the operational arrangements of the securities
depository.
2.03.' Dates and Interest Payment Dates. Upon initial delivery of the Bonds
pursuant to Section 2.07 and upon any subsequent transfer or exchange pursuant to Section 2.06,
the date of authentication shall be noted on each Bond so delivered, exchanged or transferred.
The interest on the Bonds shall be payable on February 1 and August 1 in each year,
commencing August 1,2003, to the owner of record thereof as of the close of business on the
fifteenth day of the preceding month,whether or not such day is a business day. Interest shall be
computed on the basis of a 360-day year composed of twelve 30-day months.
2.04. Redemption. The Bonds shall not be subject to redemption prior to their
stated maturity dates.
2.05. Appointment of Initial Registrar. The Issuer hereby appoints
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Minnesota, as the initial bond registrar,transfer agent and paying agent(the Registrar). The
Mayor and the City Manager are authorized to execute and deliver, on behalf of the Issuer, a
contract with the Registrar. Upon merger or consolidation of the Registrar with another
corporation, if the resulting corporation is a bank or trust company authorized by law to conduct
such business, such corporation shall be authorized to act as successor Registrar. The Issuer
agrees to pay the reasonable and customary charges of the Registrar for the services performed.
The Issuer reserves the right to remove the Registrar upon thirty(30) days notice and upon the
appointment of a successor Registrar,in which event the predecessor Registrar shall deliver all
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cash and Bonds in its possession to the successor Registrar and shall deliver the bond register to
the successor Registrar.
2.06. Registration. The effect of registration and the rights and duties of the
Issuer and the Registrar with respect thereto shall be as follows:
(a) Register. The Registrar shall keep at its principal corporate trust office a bond
register in which the Registrar shall provide for the registration of ownership of Bonds
and the registration of transfers and exchanges of Bonds entitled to be registered,
transferred or exchanged.
(b) Transfer of Bonds. Upon surrender for transfer of any Bond duly endorsed by
the registered owner thereof or accompanied by a written instrument of transfer, in form
satisfactory to the Registrar,duly executed by the registered owner thereof or by an
attorney duly authorized by the registered owner in writing,the Registrar shall
authenticate and deliver,in the name of the designated transferee or transferees, one or
more new Bonds of a like aggregate principal amount and maturity, as requested by the
transferor. The Registrar may, however, close the books for registration of any transfer
after the fifteenth day of the month preceding each interest payment date and until such
interest payment date.
(c) Exchange of Bonds. Whenever any Bonds are surrendered by the registered
owner for exchange the Registrar shall authenticate and deliver one or more new Bonds
of a like aggregate principal amount and maturity, as requested by the registered owner or
the owner's attorney in writing.
(d) Cancellation. All Bonds surrendered upon any transfer or exchange shall be
promptly canceled by the Registrar and thereafter disposed of as directed by the Issuer.
(e) Improper or Unauthorized Transfer. When any Bond is presented to the
Registrar for transfer,the Registrar may refuse to transfer the same until it is satisfied that
the endorsement on such Bond or separate instrument of transfer is valid and genuine and
that the requested transfer is legally authorized. The Registrar shall incur no liability for
the refusal, in good faith,to make transfers which it, in its judgment, deems improper or
unauthorized.
(f) Persons Deemed Owners. The Issuer and the Registrar may treat the person in
whose name any Bond is at any time registered in the bond register as the absolute owner
of the Bond,whether the Bond shall be overdue or not, for the purpose of receiving
payment of or on account of,the principal of and interest on the Bond and for all other
purposes; and all payments made to any registered owner or upon the owner's order shall
be valid and effectual to satisfy and discharge the liability upon Bond to the extent of the
sum or sums so paid.
(g) Taxes,Fees and Charges. For every transfer or exchange of Bonds (except
for an exchange upon a partial redemption of a Bond),the Registrar may impose a charge
upon the owner thereof sufficient to reimburse the Registrar for any tax, fee or other
governmental charge required to be paid..rith respect to such transfer or exchange.
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(h) Mutilated,Lost, Stolen or Destroyed Bonds. In case any Bond shall become
mutilated or be destroyed,stolen or lost,the Registrar shall deliver a new Bond of live
amount,number, maturity date and tenor in exchange and substitution for and upon
cancellation of any such mutilated Bond or in lieu of and in substitution for any Bond
destroyed, stolen or lost,upon the payment of the reasonable expenses and charges of the
Registrar in connection therewith; and,in the case of a Bond destroyed, stolen or lost,
upon filing with the Registrar of evidence satisfactory to it that the Bond was destroyed,
stolen or lost, and of the ownership thereof, and upon furnishing to the Registrar of an
appropriate bond or indemnity in form,substance and amount satisfactory to it, in which
both the Issuer and the Registrar shall be named as obligees. All Bonds so surrendered to
the Registrar shall be canceled by it and evidence of such cancellation shall be given to
the Issuer. If the mutilated, destroyed, stolen or lost Bond has already matured or been
called for redemption in accordance with its terms it shall not be necessary to issue a new
Bond prior to payment.
(i) Authenticating Agent. The Registrar is hereby designated authenticating
agent for the Bonds,within the meaning of Minnesota Statutes, Section 475.55,
Subdivision 1, as amended.
2.07. Execution, Authentication and Delivery. The Bonds shall be prepared
under the direction of the Manager and shall be executed on behalf of the Issuer by the signatures
of the Mayor and the Manager,provided that the signatures may be printed, engraved or
lithographed facsimiles of the originals. In case any officer whose signature or a facsimile of
whose signature shall appear on the Bonds shall cease to be such officer before the delivery of
any Bond, such signature or facsimile shall nevertheless be valid and sufficient for all purposes,
the same as if such officer had remained in office until delivery. Notwithstanding such
execution,no Bond shall be valid or obligatory for any purpose or entitled to any security or
benefit under this Resolution unless and until a certificate of authentication on the Bond has been
duly executed by the manual signature of an authorized representative of the Registrar.
Certificates of authentication on different Bonds need not be signed by the same representative.
The executed certificate of authentication on each Bond shall be conclusive evidence that it has
been authenticated and delivered under this Resolution. When the Bonds have been prepared,
executed and authenticated,the Manager shall deliver them to the Purchaser upon payment of the
purchase price in accordance with the contract of sale heretofore executed, and the Purchaser
shall not be obligated to see to the application of the purchase price.
2.08. Securities Depository. (a) For purposes of this section the following terms
shall have the following meanings:
"Beneficial Owner"shall mean,whenever used with respect to a Bond, the person
in whose name such Bond is recorded as the beneficial owner of such Bond by a Participant on
the records of such Participant,or such person's subrogee.
"Cede & Co."shall mean Cede&Co.,the nominee of DTC, and any successor
nominee of DTC with respect to the Bonds.
"DTC"shall mean The Depository Trust Company of New York,New York.
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"Participant"shall mean any broker-dealer,bank-or other financial institution for
which DTC holds Bonds as securities depository.
"Representation Letter" shall mean the Representation Letter pursuant to which
the Issuer agrees to comply with DTC's Operational Arrangements.
(b) The Bonds shall be initially issued as separately authenticated fully registered
bonds, and one Bond shall be issued in the principal amount of each stated maturity of the
Bonds. Upon initial issuance,the ownership of such Bonds shall be registered in the bond
register in the name of Cede&Co., as nominee of DTC. The Registrar and the Issuer may treat
DTC (or its nominee) as the sole and exclusive owner of the Bonds registered in its name for the
purposes of payment of the principal of or interest on the Bonds, selecting the Bonds or portions
thereof to be redeemed, if any, giving any notice permitted or required to be given to registered
owners of Bonds under this resolution, registering the transfer of Bonds, and for all other
purposes whatsoever; and neither the Registrar nor the Issuer shall be affected by any notice to
the contrary. Neither the Registrar nor the Issuer shall have any responsibility or obligation to
any Participant, any person claiming a beneficial ownership interest in the Bonds under or
through DTC or any Participant, or any other person which is not shown on the bond register as
being a registered owner of any Bonds, with respect to the accuracy of any records maintained
by DTC or any Participant,with respect to the payment by DTC or any Participant of any
amount with respect to the principal of or interest on the Bonds,with respect to any notice which
is permitted or required to be given to owners of Bonds under this resolution,with respect to the
selection by DTC or any Participant of any person to receive payment in the event of a partial
redemption of the Bonds, or with respect to any consent given or other action taken by DTC as
registered owner of the Bonds. So long as any Bond is registered in the name of Cede & Co., as
nominee of DTC,the Registrar shall pay all principal of and interest on such Bond, and shall
give all notices with respect to such Bond only to Cede&Co. in accordance with DTC's
Operational Arrangements, and all such payments shall be valid and effective to fully satisfy and
discharge the Issuer's obligations with respect to the principal of and interest on the Bonds to the
extent of the sum or sums so paid. No person other than DTC shall receive an authenticated
Bond for each separate stated maturity evidencing the obligation of the Issuer to make payments
of principal and interest. Upon delivery by DTC to the Registrar of written notice to the effect
that DTC has determined to substitute a new nominee in place of Cede&Co., the Bonds will be
transferable to such new nominee in accordance with paragraph(e)hereof.
(c) In the event the Issuer determines that it is in the best interest of the
Beneficial Owners that they be able to obtain Bonds in the form of bond certificates,the Issuer
may notify DTC and the Registrar,whereupon DTC shall notify the Participants of the
availability through DTC of Bonds in the form of certificates. In such event,the Bonds will be
transferable in accordance with paragraph(e)hereof. DTC may determine to discontinue
providing its services with respect to the Bonds at any time by giving notice to the Issuer and the
Registrar and discharging its responsibilities with respect thereto under applicable law. In such
event the Bonds will be transferable in accordance with paragraph(e) hereof.
(d) The execution and delivery of the Representation Letter to DTC by the Mayor
or Manager is hereby authorized and directed.
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(e) In the event that any transfer or exchange of Bonds is permitted under
paragraph(b) or(c)hereof, such transfer or exchange shall be accomplished upon receipt by the
Registrar of the Bonds to be transferred or exchanged and appropriate instruments of transfer to
the permitted transferee in accordance with the provisions of this resolution. In the event Bonds
in the form of certificates are issued to owners other than Cede&Co., its successor as nominee
for DTC as owner of all the Bonds,or another securities depository as owner of all the Bonds,
the provisions of this resolution shall also apply to all matters relating thereto, including,without
limitation,the printing of such Bonds in the form of bond certificates and the method of payment
of principal of and interest on such Bonds in the form of bond certificates.
2.09. Form of Bonds. The Bonds shall be prepared in substantially the following
form:
UNITED STATES OF AMERICA
STATE OF MINNESOTA
HENNEPIN COUNTY
CITY OF EDEN PRAIRIE
GENERAL OBLIGATION REFUNDING BOND, SERIES 2003B
Interest Rate Maturity Date Date of Original Issue CUSIP No.
% February 1, 20_ January 1,2003
REGISTERED OWNER: CEDE&CO.
PRINCIPAL AMOUNT: THOUSAND DOLLARS
The City of Eden Prairie, County of Hennepin, State of Minnesota(the Issuer)
acknowledges itself to be indebted and for value received hereby promises to pay to the
registered owner specified above, or registered assigns,the principal amount specified above on
the maturity date specified above, without option of prior payment,with interest thereon from the
date hereof at the annual rate specified above,payable on February 1 and August 1 in each year,
commencing August 1, 2003,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. Interest hereon shall be computed on the basis of a 360-day year composed of twelve 30-
day months. The interest hereon and, upon presentation and surrender hereof,the principal
hereof are payable in lawful money of the United States of America by check or draft by
, in ,Minnesota, as Bond
Registrar and Paying Agent, or its designated successor under the Resolution described herein
(the Registrar). For the prompt and full payment of such principal and interest as the same
respectively become due, the full faith and credit and taxing powers of the Issuer have been and
are hereby irrevocably pledged.
This Bond is one of an issue in the aggregate principal amount of$2,710,000 issued
pursuant to a resolution adopted by the City Council on December 17, 2002 (the Resolution),to
provide funds to refund certain outstanding general obligation Bonds of the Issuer and is issued
pursuant to and in full conformity with the Constitution and laws of the State of Minnesota
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thereunto enabling, including I'vEnnesota Statutes, Chapter 475. The Bonds are issuable only in
fully registered form,in denominations of$5,000 or any integral multiple thereof,of single
maturities.
As provided in the Resolution and subject to certain limitations set forth therein,this
Bond is transferable upon the books of the Issuer at the principal office of the Registrar,by the
registered owner hereof in person or by the owner's attorney duly authorized in writing upon
surrender hereof together with a written instrument of transfer satisfactory to the Registrar, duly
executed by the registered owner or the owner's attorney; and may also be surrendered in
exchange for Bonds of other authorized denominations. Upon such transfer or exchange the
Issuer will cause a new Bond or Bonds to be issued in the name of the transferee or registered
owner,of the same aggregate principal amount,bearing interest at the same rate and maturing on
the same date, subject to reimbursement for any tax, fee or governmental charge required to be
paid with respect to such transfer or exchange.
Notwithstanding any other provisions of this Bond, so long as this Bond is registered in
the name of Cede&Co., as nominee of The Depository Trust Company, or in the name of any
other nominee of The Depository Trust Company or other securities depository, the Registrar
shall pay all principal of and interest on this Bond, and shall give all notices with respect to this
Bond, only to Cede & Co. or other nominee in accordance with the operational arrangements of
The Depository Trust Company or other securities depository as agreed to by the Issuer.
The Issuer and the Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of
receiving payment and for all other purposes, and neither the Issuer nor the Registrar shall be
affected by any notice to the contrary.
IT IS HEREBY CERTIFIED,RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the Constitution and laws of the State of Minnesota to be done,
to exist,to happen and to be performed preliminary to and in the issuance of this Bond in order
to make it a valid and binding general obligation of the Issuer in accordance with its terms,have
been done, do exist,have happened and have been performed as so required; that the Issuer has
established its General Obligation Refunding Bonds, Series 2003B Bond Fund and has
appropriated thereto the net operating revenues of its municipal sewer and water system (the
Sewer and Water System),which together with other funds appropriated by the City are
estimated to be receivable in years and amounts not less than five percent in excess of the
principal of and interest on the Bonds when due; that if necessary for the payment of such
principal and interest when due, additional ad valorem taxes are required to be levied upon all
such property,without limitation as to rate or amount; that the issuance of this Bond does not
cause the indebtedness of the Issuer to exceed any constitutional or statutory limitation of
indebtedness; and that the opinion printed hereon is a full and correct copy of the legal opinion
given by Bond Counsel with reference to the Bonds, dated as of the date of original delivery of
the Bonds.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Resolution until the Certificate of Authentication hereon shall have
been executed by the Registrar by manual signature of one of its authorized representatives.
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IN WITNESS WBEEREOF, the Issuer,by its City Council,has caused this Bond to be
executed on its behalf by the facsimile signatures of the Mayor and City Manager and has caused
this Bond to be dated as of the date set forth below.
CITY OF EDEN PRAIl JE, MINNESOTA
(facsimile signature City Manager) (facsimile signature Mayor)
CERTIFICATE OF AUTHENTICATION
Dated
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
[REGISTRAR], as Registrar
By
Authorized Representative
[Insert Legal Opinion]
The following abbreviations,when used in the inscription on the face of this Bond, shall be
construed as though they were written out in full according to the applicable laws or regulations:
TEN COM—as tenants in common UTMA........................... as Custodian for.............
(Gust) (Minor)
under Uniform Transfers to Minors Act..........
TEN ENT—as tenants by the entireties (State)
JT TEN—as joint tenants with right of survivorship and not as tenants in common
Additional abbreviations may also be used.
ASSIGNMENT
For value received,the undersigned hereby sells, assigns and transfers unto
the within Bond and all rights thereunder, and does hereby irrevocably
constitute and appoint attorney to transfer the said Bond on the books
kept for registration of the within Bond,with full power of substitution in the premises.
Dated:
NOTICE: The assignor's signature to this assignment
must correspond with the name as it appears upon the
S
face of the within Bond in every particular,without
alteration or enlargement or any change whatsoever.
Signature Guaranteed:
Signature(s) must be guaranteed by an"eligible guarantor institution"meeting the requirements
of the Registrar,which requirements include membership or participation in STAMP or such
other"signature guaranty program" as may be determined by the Registrar in addition to or in
substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as
amended.
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE:
[End of the Bond form]
Section 3. Use of Proceeds. Upon payment for the Bonds by the Purchaser,the
Finance Director shall deposit and apply the proceeds of the Bonds as follows: (a)
$ shall be deposited in the sinking fund established for the 1993C General
Obligation Sewer and Water Refunding Bonds to be applied to their redemption and prepayment
on their date of redemption(February 1, 2003), in accordance with the provisions of the
resolution authorizing their issuance; (b) $ shall be used to pay issuance
expenses of the Bonds; and (c) $ shall be deposited in the Bond Fund created
pursuant to Section 4.01 hereof.
Section 4. General Obligation Refunding Bonds, Series 2003B Bond Fund and
Pledge of Revenues and Taxing Powers.
4.01. General Obligation Refunding Bonds, Series 2003B Bond Fund. The
Bonds shall be payable from a separate and special General Obligation Refunding Bonds, Series
2003B Bond Fund(the Bond Fund) of the Issuer,which the Issuer agrees to maintain until the
Bonds have been paid in full. If the money in the Bond Fund should at any time be insufficient
to pay principal and interest due on the Bonds, such amounts shall be paid from other moneys on
hand in other funds of the Issuer,which other funds shall be reimbursed therefor when sufficient
money becomes available in the Bond Fund. The moneys on hand in the Bond Fund from time
to time shall be used only to pay the principal of and interest on the Bonds. Into the Bond Fund
shall be paid: (a) any accrued interest and unused discount received from the Purchaser upon
delivery of the Bonds; (b) subsequent to the Redemption Date, the Sewer and Water System
revenues described in Section 4.02; and(c) any other funds appropriated by the Council for the
payment of the Bonds.
4.02. Sufficiency of Sewer and Water System Revenues. It is hereby found,
determined and declared that the City owns and operates its municipal sewer and water system
(the Sewer and Water System) as a revenue-producing utility and convenience and that the net
operating revenues of the Sewer and Water System, after deducting from the gross receipts
derived from charges for the service,use and availability of the Sewer and Water System the
expenses of operation and maintenance thereof(excluding interest, amortization and
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depreciation), will be sufficient,with any other funds actually appropriated by the City, for the
payment when due of the principal of and interest on the Bonds herein authorized, and on any
other bonds or other obligations of the City to which such revenues are or may be pledged. The
Bonds shall not be secured by a mortgage lien upon or security interest in any part of the Sewer
and Water System.
4.03. Rate Covenant. Pursuant to Minnesota Statutes, Section 444.075,the City
hereby agrees with the registered owners from time to time of the Bonds,that until the Bonds
and the interest thereon are paid in full, or are discharged as provided in Section 5, the City will
impose and collect reasonable charges for the service,use and availability of the Sewer and
Water System, according to schedules which will produce net revenues sufficient,with any other
funds appropriated by the City, to pay all principal and interest when due on the Bonds and any
other bonds or other obligations of the City to which said net revenues have been or may be
pledged; and said net revenues, to the extent necessary, are hereby irrevocably pledged and
appropriated to the payment of the principal of and interest on the Bonds and shall be credited to
the Bond Fund as required. Nothing herein shall preclude the City from hereafter making fizrther
pledges and appropriations of the net revenues of the Sewer and Water System for payment of
additional bonds or other obligations of the City hereafter authorized if the City Council
determines before the authorization of such additional obligations that the estimated net revenues
of the Sewer and Water System will be sufficient,with any other sources pledged to the payment
of the Bonds, any other outstanding obligations payable in whole or in part from said net
revenues and the additional obligations, for payment of the Bonds, any such other outstanding
obligations and such additional obligations. Such further pledges and appropriations of said net
revenues may be made superior or subordinate to, or on a parity with, the pledge and
appropriation of net revenues herein made.
4.04. Pledge of Taxing Powers. For the prompt and full payment of the principal
of and interest on the Bonds as such payments respectively become due,the full faith, credit and
unlimited taxing powers of the Issuer shall be and are hereby irrevocably pledged. However, the
City presently estimates that the payments to be received from the Sewer and Water System and
appropriated to the Bond Fund pursuant to Section 4.01 hereof,together with interest earnings
thereon,will be at least five percent in excess of the amounts needed to meet when due the
principal and interest payments on the Bonds and therefore no ad valorem taxes are required to
be levied at this time.
Section 5. Defeasance. When all of the Bonds have been discharged as provided
in this section, all pledges, covenants and other rights granted by this Resolution to the registered
owners of the Bonds shall cease. The Issuer may discharge its obligations with respect to any
Bonds which are due on any date by depositing with the Registrar on or before that date a sum
sufficient for the payment thereof in full; or, if any Bond should not be paid when due, it may
nevertheless be discharged by depositing with the Registrar a sum sufficient for the payment
thereof in full with interest accrued from the due date to the date of such deposit. The Issuer may
also at any time discharge its obligations with respect to any Bonds, subject to the provisions of
law now or hereafter authorizing and regulating such action,by depositing irrevocably in escrow,
with a bank qualified by law as an escrow agent for this purpose, cash or securities which are
authorized by law to be so deposited,bearing interest payable at such time and at such rates and
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maturing or callable at the holder's option on such dates as shall be required to pay all principal
and interest to become due thereon to maturity or earlier designated redemption date.
Section 6. Tax Covenants: Arbitrage Matters and Continuing Disclosure.
6.01. General Tax Covenant. The Issuer covenants and agrees with the registered
owners from time to time of the Bonds that it will not take, or permit to be taken by any of its
officers, employees or agents,any actions that would cause interest on the Bonds to become
includable in gross income of the recipient under the Internal Revenue Code of 1986, as
amended(the Code) and applicable Treasury Regulations (the Regulations), and covenants to
take any and all actions within its powers to ensure that the interest on the Bonds will not
become includable in gross income of the recipient under the Code and the Regulations.
6.02. Certification. The Mayor and City Manager being the officers of the Issuer
charged with the responsibility for issuing the Bonds pursuant to this Resolution, are authorized
and directed to execute and deliver to the Purchaser a certificate in accordance with the
provisions of Section 148 of the Code, and applicable Regulations, stating the facts, estimates
and circumstances in existence on the date of issue and delivery of the Bonds which make it
reasonable to expect that the proceeds of the Bonds will not be used in a manner that would
cause the Bonds to be"arbitrage bonds"within the meaning of the Code and Regulations.
6.03. Arbitrage Rebate. The Issuer acknowledges that the Bonds are subject to
the rebate requirements of Section 148(f) of the Code. The Issuer covenants and agrees to retain
such records, make such determinations, file such reports and documents and pay such amounts
at such times as are required under said Section 148(f) and applicable Regulations to preserve the
exclusion of interest on the Bonds from gross income for federal income tax purposes.
6.04. Continuing Disclosure. (a) Purpose and Beneficiaries. To provide for the
public availability of certain information relating to the Bonds and the security therefor and to
permit the Purchaser and other participating underwriters in the primary offering of the Bonds to
comply with amendments to Rule 15c2-12 promulgated by the SEC under the Securities
Exchange Act of 1934(17 C.F.R. § 240.15c2-12),relating to continuing disclosure (as in effect
and interpreted from time to time, the Rule), which will enhance the marketability of the Bonds,
the City hereby makes the following covenants and agreements for the benefit of the Owners (as
hereinafter defined) from time to time of the Outstanding Bonds. The City is the only obligated
person in respect of the Bonds within the meaning of the Rule for purposes of identifying the
entities in respect of which continuing disclosure must be made. The City has complied in all
material respects with any undertaking previously entered into by it under the Rule. If the City
fails to comply with any provisions of this section, any person aggrieved thereby,including the
Owners of any Outstanding Bonds, may take whatever action at law or in equity may appear
necessary or appropriate to enforce performance and observance of any agreement or covenant
contained in this section, including an action for a writ of mandamus or specific performance.
Direct, indirect, consequential and punitive damages shall not be recoverable for any default
hereunder to the extent permitted by law. Notwithstanding anything to the contrary contained
herein,in no event shall a default under this section constitute a default under the Bonds or under
any other provision of this resolution. As used in this section, Owner or Bondo«mer means, in
respect of a Bond, the registered ovmer or owners thereof appearing in the bond register
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maintained by the Registrar or any Beneficial Owner(as hereinafter defined)thereof, if such
Beneficial Owner provides to the Registrar evidence of such beneficial ownership in form and
substance reasonably satisfactory to the Registrar. As used herein,Beneficial Owner means,in
respect of a Bond, any person or entity which(i)has the power, directly or indirectly, to vote or
consent with respect to, or to dispose of ownership of, such Bond (including persons or entities
holding Bonds through nominees, depositories or other intermediaries), or(b) is treated as the
owner of the Bond for federal income tax purposes.
(b) Information To Be Disclosed. The City will provide, in the manner set forth in subsection
(c)hereof, either directly or indirectly through an agent designated by the City, the following
information at the following times:
(1) on or before 365 days after the end of each fiscal year of the City,commencing with
the fiscal year ending December 31, 2002, the following financial information and
operating data in respect of the City(the Disclosure Information):
(A) the audited financial statements of the City for such fiscal year,containing
balance sheets as of the end of such fiscal year and a statement of operations,
changes in fund balances and cash flows for the fiscal year then ended, showing
in comparative form such figures for the preceding fiscal year of the City,
prepared in accordance with generally accepted accounting principles
promulgated by the Financial Accounting Standards Board as modified in
accordance with the governmental accounting standards promulgated by the
Governmental Accounting Standards Board or as otherwise provided under
Minnesota law, as in effect from time to time, or, if and to the extent such
financial statements have not been prepared in accordance with such generally
accepted accounting principles for reasons beyond the reasonable control of the
City, noting the discrepancies therefrom and the effect thereof, and certified as
to accuracy and completeness in all material respects by the fiscal officer of the
City; and
(B) to the extent not included in the financial statements referred to in paragraph(A)
hereof,the information for such fiscal year or for the period most recently
available of the type contained in the Official Statement under headings: City
Property Values; City Indebtedness; and City Tax Rates,Levies and
Collections.
Notwithstanding the foregoing paragraph, if the audited financial statements are not available by
the date specified, the City shall provide on or before such date unaudited financial statements in
the format required for the audited financial statements as part of the Disclosure Information and,
within 10 days after the receipt thereof,the City shall provide the audited financial statements.
Any or all of the Disclosure Information may be incorporated by reference, if it is updated as
required hereby, from other documents, including official statements,which have been submitted
to each of the repositories hereinafter referred to under subsection(c) or to the SEC. If the
document incorporated by reference is a final official statement, it must be available from the
Municipal Securities Rulemalting Board. The City shall clearly identify in the Disclosure
12
Information each document so incorporated by reference. If any part of the Disclosure
Information can no longer be generated because the operations of the City have materially
changed or been discontinued, such Disclosure Information need no longer be provided if the
City includes in the Disclosure Information a statement to such effect;provided,however,if such
operations have been replaced by other City operations in respect of which data is not included in
the Disclosure Information and the City determines that certain specified data regarding such
replacement operations would be a Material Fact(as defined in paragraph(2)hereof), then, from
and after such determination, the Disclosure Information shall include such additional specified
data regarding the replacement operations. If the Disclosure Information is changed or this
section is amended as permitted by this paragraph(b)(1) or subsection(d),then the City shall
include in the next Disclosure Information to be delivered hereunder,to the extent necessary, an
explanation of the reasons for the amendment and the effect of any change in the type of
financial information or operating data provided.
(2) In a timely manner,notice of the occurrence of any of the following events which is
a Material Fact(as hereinafter defined):
(A) Principal and interest payment delinquencies;
(B) Non-payment related defaults;
(C) Unscheduled draws on debt service reserves reflecting financial difficulties;
(D) Unscheduled draws on credit enhancements reflecting financial difficulties;
(E) Substitution of credit or liquidity providers, or their failure to perform;
(F) Adverse tax opinions or events affecting the tax-exempt status of the security;
(G) Modifications to rights of security holders;
(H) Bond calls;
(I) Defeasances;
(J) Release, substitution, or sale of property securing repayment of the securities;
and
(K) Rating changes.
As used herein, a Material Fact is a fact as to which a substantial likelihood exists that a
reasonably prudent investor would attach importance thereto in deciding to buy,hold or sell a
Bond or, if not disclosed, would significantly alter the total information otherwise available to an
investor from the Official Statement, information disclosed hereunder or information generally
available to the public. Notwithstanding the foregoing sentence, a Material Fact is also an event
that would be deemed material for purposes of the purchase,holding or sale of a Bond within the
meaning of applicable federal securities laws, as interpreted at the time of discovery of the
occurrence of the event.
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(3) Ea a timely manner,notice of the occurrence of any of the following events or
conditions:
(A) the failure of the City to provide the Disclosure Information required under
paragraph (b)(1) at the time specified thereunder;
(B) the amendment or supplementing of this section pursuant to subsection (d),
together with a copy of such amendment or supplement and any explanation
provided by the City under subsection(d)(2);
(C) the termination of the obligations of the City under this section pursuant to
subsection(d);
(D) any change in the accounting principles pursuant to which the financial
statements constituting a portion of the Disclosure Information are prepared;
and
(E) any change in the fiscal year of the City.
(c) Manner of Disclosure. The City agrees to make available the information described in
subsection(b) to the following entities by telecopy, overnight delivery, mail or other means, as
appropriate:
(1) the information described in paragraph(1) of subsection(b),to each then nationally
recognized municipal securities information repository under the Rule and to any
state information depository then designated or operated by the State of Minnesota
as contemplated by the Rule (the State Depository), if any;
(2) the information described in paragraphs(2) and(3) of subsection(b), to the
Municipal Securities Rulemaking Board and to the State Depository, if any; and
(3) the information described in subsection(b),to any rating agency then maintaining a
rating of the Bonds at the request of the City and, at the expense of such Bondowner,
to any Bondowner who requests in writing such information, at the time of
transmission under paragraphs (1) or(2)of this subsection(c), as the case may be,
or, if such information is transmitted with a subsequent time of release, at the time
such information is to be released.
(d) Term; Amendments; Interpretation.
(1) The covenants of the City in this section shall remain in effect so long as any Bonds
are Outstanding. Notwithstanding the preceding sentence,however, the obligations
of the City under this section shall terminate and be without further effect as of any
date on which the City delivers to the Registrar an opinion of Bond Counsel to the
effect that,because of legislative action or final judicial or administrative actions or
proceedings,the failure of the City to comply with the requirements of this section
will not cause participating underwriters in the primary offering of the Bonds to be
in violation of the Rule or other applicable requirements of the Securities Exchange
Act of 1934, as amended, or any statutes or laws successory thereto or amendatory
thereof.
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(2) This section (and the form and requirements of the Disclosure Information)may be
amended or supplemented by the City from time to time, without notice to(except as
provided in paragraph(c)(3)hereof) or the consent of the Owners of any Bonds, by a
resolution of this Council filed in the office of the recording officer of the City
accompanied by an opinion of Bond Counsel,who may rely on certificates of the
City and others and the opinion may be subject to customary qualifications, to the
effect that: (i) such amendment or supplement(a) is made in connection with a
change in circumstances that arises from a change in law or regulation or a change in
the identity,nature or status of the City or the type of operations conducted by the
City, or(b) is required by, or better complies with, the provisions of paragraph(b)(5)
of the Rule; (ii)this section as so amended or supplemented would have complied
with the requirements of paragraph(b)(5)of the Rule at the time of the primary
offering of the Bonds, giving effect to any change in circumstances applicable under
clause(i)(a) and assuming that the Rule as in effect and interpreted at the time of the
amendment or supplement was in effect at the time of the primary offering; and (iii)
such amendment or supplement does not materially impair the interests of the
Bondowners under the Rule.
If the Disclosure Information is so amended,the City agrees to provide,
contemporaneously with the effectiveness of such amendment, an explanation of the
reasons for the amendment and the effect,if any, of the change in the type of
financial information or operating data being provided hereunder.
(3) This section is entered into to comply with the continuing
disclosure provisions of the Rule and should be construed so as to satisfy the
requirements of paragraph(b)(5) of the Rule.
Section 7. Certification of Proceedings and Redemption of Refunded Bonds.
7.01. Registration of Bonds. The City Clerk is hereby authorized and directed to
file a certified copy of this resolution with the County Auditor of Hennepin County and obtain a
certificate that the Bonds have been duly entered upon the County Auditor's bond register and
the tax required by law has been levied.
7.02. Authentication of Transcript. The officers of the Issuer and the County
Auditor are hereby authorized and directed to prepare and furnish to the Purchaser and to Dorsey
&Whitney LLP, Bond Counsel, certified copies of all proceedings and records relating to the
Bonds and such other affidavits, certificates and information as may be required to show the
facts relating to the legality and marketability of the Bonds, as the same appear from the books
and records in their custody and control or as otherwise known to them, and all such certified
copies, affidavits and certificates,including any heretofore furnished, shall be deemed
representations of the Issuer as to the correctness of all statements contained therein.
7.03. Official Statement. The Official Statement relating to the Bonds, dated
December_,2002,prepared and distributed by Northland Securities, Inc., the financial
consultant for the Issuer, is hereby approved. Northland Securities,Inc., is hereby authorized on
15
behalf of the Issuer to prepare and distribute to the Purchaser within seven business days from
the date hereof, a supplement to the Official Statement listing the offering price,the interest
rates,selling compensation, delivery date,the underwriters and such other information relating to
the Bonds required to be included in the Official Statement by the Rule. The officers of the
Issuer are hereby authorized and directed to execute such certificates as may be appropriate
concerning the accuracy, completeness and sufficiency of the Official Statement.
7.04. Redemption of Refunded Bonds. The City Clerk is hereby directed to
advise U.S.Bank National Association, successor to American National Bank and Trust
Company, St. Paul,Minnesota, as paying agent for the Refunded Bonds,to call the Refunded
Bonds for redemption and prepayment on the Redemption Date in the form attached hereto, all in
accordance with the provisions of the resolutions authorizing the issuance of the Refunded
Bonds.
ADOPTED by the City Council of the City of Eden Prairie this 17th day of December, 2002.
ancy a- e r
ATTEST:
23�6�d'A
K hleen A.Porta, City Clerk
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NOTICE OF REDEMPTION
$6,735,000 General Obligation Sewer and Water Refunding Bonds, Series 1993C
Dated May 1, 1993
City of Eden Prairie,Hennepin County,Minnesota
NOTICE IS HEREBY GIVEN THAT there have been called for redemption and prepayment on
February 1,2003,all outstanding Bonds of the above referenced issue,dated May 1, 1993,maturing
February 1 in the following years and having the interest rates and CUSIP numbers listed below:
Maturity Amount CUSIP# Rate Maturity Amount CUSIP# Rate
2004 $490,000 279515Q52* 5.40% 2007 $555,000 279515R93* 5.65%
2005 505,000 279515Q94* 5.50 2008 595,000 279515550* 5.70
2006 520,000 279515R51* 5.60
* indicates full call.
The Bonds will be redeemed at a price of 100%of their principal amount plus accrued interest to the date
of redemption. Holders of the Bonds should present them for payment to U.S.Bank National
Association, St.Paul,Minnesota, successor to American National Bank and Trust Company, St.Paul,
Minnesota, on or before said date,when they will cease to bear interest,in the following manner:
If by Mail: If by Hand or Overnight Mail:
U.S.Bank National Association U.S.Bank National Association
Corporate Trust Operations, 3rd Floor Bond Drop Window, 3rd Floor
Post Office Box 64111 180 East Fifth Street
Saint Paul,MN 55164-0111 Saint Paul,Minnesota 55101
(800) 934-6802
In compliance with the Interest and Dividend Compliance Act of 1983 and Broker Reporting
Requirements,the redeeming institutions are required to withhold 3 1% of the principal amount of your
holdings redeemed unless they are provided with your social security number or federal employer
identification number,properly certified. This requirement is fulfilled through the submitting of a W-9
Form,which may be obtained at a bank or other financial institution.
The Paying Agent shall not be responsible for the selection of or use of the CUSIP number,nor is any
representation made as to its correctness indicated in this Notice of Redemption. It is included solely for
the convenience of the bond holders.
Additional information may be obtained from the undersigned or from Northland Securities,Inc.,45 S. 7"'
St.,Minneapolis,Minnesota 55402(612-851-5900),financial consultant to the City.
Dated: December 17,2002. U.S.BANK NATIONAL ASSOCIATION