HomeMy WebLinkAboutResolution - 98-39 - Bond Sale of General Obligation Water & Sewer Revenue Bonds, 1998A - 03/17/1998 CERTIFICATION OF MINUTES RELATING TO
$_7,9 5 0, 7 2 7 GENERAL OBLIGATION WATER AND SEWER REVENUE BONDS,SERIES 1998A
(CAPITAL APPRECIATION BONDS)
Issuer: City of Eden Prairie,Minnesota
Governing Body: City Council
Kind, date, time and place of meeting: A regular meeting held on March 17, 1998 at 7:30 o'clock
P.M., at the City Hall,Eden Prairie,Minnesota.
Memberspresent: Mayor Harris, Councilmembers Butcher-Younghans, Case, Thorfinnson
Members absent: Councilmember Tyra-Lukens
Documents Attached:
Minutes of said meeting (including):
RESOLUTION NO, 98-39
RESOLUTION AUTHORIZING ISSUANCE,PRESCRIBING THE FORM
AND DETAILS AND PROVIDING FOR THE PAYMENT OF$7, 9 5 0, 7 2 7
GENERAL OBLIGATION WATER AND SEWER REVENUE BONDS,
SERIES 1998A (CAPITAL APPRECIATION BONDS)
I, the undersigned, being the duly qualified and acting recording officer of the public
corporation issuing the bonds referred to in the title of this certificate, certify that the documents
attached hereto, as described above, have been carefully compared with the original records of
said corporation in my legal custody, from which they have been transcribed; that said documents
are a correct and complete transcript of the minutes of a meeting of the governing body of said
corporation, and correct and complete copies of all resolutions and other actions taken and of all
documents approved by the governing body at said meeting, so far as they relate to said bonds;
and that said meeting was duly held by the governing body at the-time and place and was
attended throughout by the members indicated above,pursuant to call and notice of such meeting
given as required by law.
WITNESS my hand officially as such recording officer on March 17, 1998.
nance Director-Clerk
It was reported that 3 sealed proposals for the purchase of the Bonds were received
prior to the time stated in the Official Statement distributed to potential purchasers of the Bonds
by Springsted Incorporated,financial consultants to the Issuer. The proposals have been publicly
opened, read and tabulated and the highest and best proposal of each bidder was found to be as
follows:
(See attached)
85 E.SEVENTH PLACE,SUITE 100
SAINT PAUL,MN 55101-2887
612-223-3000 FAX-612-223-3002
SPRINGSTED
Public FinaweAdWsors
F'00�
$7,950,000*
CITY OF EDEN PRAIRIE, MINNESOTA
GENERAL OBLIGATION WATER AND SEWER
REVENUE BONDS,SERIES 1998A
(BOOK ENTRY ONLY)
AWARD: DAIN RAUSCHER CORPORATION
SALE: March 17, 1998 Moody's Rating: Aa3
Interest Purchase Total Dollar True Interest
Bidder Rates Price Interest Cost Rate
DAIN RAUSCHER CORPORATION 4.05% 2001 $7,820,524.00 $3,679,476.00 4.6754%
4.15% 2002
4.30% 2003
4.40% 2004
4.50% 2005
4.55% 2006
4.60% 2007
4.70% 2008
NORWEST INVESTMENT SERVICES, INC. 4.10% 2001 $7,793,133.56 $3,706,866.44 4.7189%
4.20% 2002
4.30% 2003
4.40% 2004
4.45% 2005
4.55% 2006
4.65% 2007
4.75% 2008
SALOMON SMITH BARNEY 4.10% 2001 $7,785,243.00 $3,714,757.00 4.7314%
4.25% 2002
4.35% 2003
4.45% 2004
4.50% 2005
4.55% 2006
4.65% 2007
4.75% 2008
BBI: 5.20%
Average Maturity: 8.216 Years
Subsequent to bid opening, the 2001 maturity was increased by$50,000 and the 2006 maturity was increased by$10,000.
SAINT PAUL,MN • MINNEAPOLIS,MN • BROOKFIELD,WI . OVERLAND PARK,KS • WASHINGTON,DC . DES MOINES,IA
Member Thorf innson, Jr. introduced the following resolution and moved its adoption,
which motion was seconded by Member Case
RESOLUTION AUTHORIZING ISSUANCE,PRESCRIBING THE FORM
AND DETAILS AND PROVIDING FOR THE PAYMENT OF$7,9 50,72 7
GENERAL OBLIGATION WATER AND SEWER REVENUE BONDS,
SERIES 1998A(CAPITAL APPRECIATION BONDS)
BE IT RESOLVED by the City Council of the City of Eden Prairie,Minnesota(the
Issuer), as follows:
SECTION 1. AUTHORIZATION AND SALE.
1.1. Authorization. By resolution duly adopted on February 17, 1998,this Council
authorized the sale of$7,950,000 approximate amount of General Obligation Water and Sewer
Revenue Bonds, Series 1998A(the Bonds),of the Issuer to finance improvements to the water
and sewer system of the Issuer,including a portion of the cost of constructing a water treatment
plant(the Project) as a part of the Issuer's municipal water and sewer system(the System,which
term shall be deemed to mean and include all property owned by the Issuer as and for water
supply, storage, treatment and distribution, as such items of property may at any time exist, and
including any and all additions thereto and improvements,extensions and alterations thereof).
1.2. Sale. The Issuer has retained Springsted Incorporated, as independent financial
advisors in connection with the sale of the Bonds. Pursuant to Minnesota Statutes, Section
475.60, subdivision 2,paragraph(9),the requirements as to public sale do not apply to the
issuance of the Bonds. The Council has received an offer from
Dain Rauscher Corporation ,
in Minneapolis (the Purchaser),to purchase$ 7,950,727 aggregate original
principal amount of Bonds at a price of$ 7,870,027.12 , on the further terms and
conditions hereinafter set forth.
1.3. Award. The sale of the Bonds is hereby awarded to the Purchaser, and the Mayor
and Manager are hereby authorized and directed on behalf of the Issuer to execute a contract for
the sale of the Bonds in accordance with the Terms of Proposal.
SECTION 2. BOND TERMS; REGISTRATION;EXECUTION AND DELIVERY.
2.1. Maturities; Interest Rates;Denominations; Payment and Dating of Bonds. The
Bonds shall be originally dated as of April 21, 1998, the date of original authentication and
delivery, the maturity values shall be paid on December 1 in the years and amounts set forth
below, shall be issued in the original principal amount shown below for each$5,000 accreted
maturity amount or integral multiples thereof and shall bear interest from the date of original
authentication and delivery thereof until maturity at the rate which, compounding on each
December 1 and June 1, commencing December 1, 1998, results in an accreted amount at
maturity as shown below (yields to maturity are approximate):
Original Total
Principal Amount Approximate
per$5,000 Accreted Total Accreted Amount Yield to
Year Amount at Maturity at Maturity_ Maturi
2001 $4,326.00 $ 350,000 4.05%
2002 4,137.25 5009'000 4.15
2003 3,938.15 900,000 4.30
2004 3,749.80 1,000,000 4.40
2005 3,563.45 1,500,000 4.50
2006 39394.00 2,310,000 4.55
2007 3,229.50 2,4009000 4.60
2008 3,054.10 2,600,000 4.70
The accreted amount for any Bond between the date of original authentication and delivery, and
its maturity, for each$5,000 maturity amount, shall be the amount set forth in the table attached
hereto. The Bonds shall be issuable only in fully registered form. The accreted amount of each
Bond shall be payable,upon surrender thereof,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 2.6 hereof, the accreted amount
shall be payable in accordance with the operational arrangements of the securities depository.
For purposes of complying with the maturity provisions of Minnesota Statutes,Section 475.54,
subdivision 1,the Bonds shall be combined with the outstanding maturities of the
General Obligation Water and Sewer Revenue Refunding Bonds, Series 1993A
2.2. Redemption. Bonds maturing in 2007 and later years shall be subject to redemption
and prepayment at the option of the Issuer,in whole or in part, in such order of maturity dates as
the Issuer shall determine(or, if applicable,by the bond depository in accordance with its
customary procedures) in$5,000 accreted maturity amounts as to Bonds maturing on the same
date, on December 1,2006, and on any date thereafter, at a redemption price of par and accrued
interest to the date of redemption. Bonds in a denomination larger than$5,000 accreted maturity
amount may be redeemed in part in any integral multiple of$5,000 accreted maturity amount.
The owner of any Bond redeemed in part shall receive,upon surrender of such Bond to the
Registrar, one or more new bonds of a maturity and aggregate accreted amount at maturity equal
to the unredeemed portion of the Bond so surrendered. The Finance Director-Clerk shall cause
notice of the call for redemption thereof to be published as required by law and, at least thirty
days prior to the designated redemption date, shall cause notice of the call for redemption to be
mailed, by first class mail, to the registered owners of any Bonds to be redeemed at their
addresses as they appear on the bond register described in Section 2.7 hereof but no defect in or
failure to give such mailed notice of redemption shall affect the validity of proceedings for the
redemption of any Bond not affected by such defect or failure;provided that notice shall be given
to any securities depository in accordance with its operational arrangements.
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2.3. Appointment of Initial Registrar. The Issuer hereby appoints
First Trust National Association ,in St. Paul ,Minnesota,
as the initial bond registrar, transfer agent and paying agent(the Registrar). The Mayor and the
Manager are authorized to execute and deliver, on behalf of the Issuer, a contract with the
Registrar. Upon merger or consolidation of the Registrar with another corporation,if the
resulting corporation is a bank or trust company authorized by law to conduct such business, such
corporation shall be authorized to act as successor Registrar. The Issuer agrees to pay the
reasonable and customary charges of the Registrar for the services performed. The Issuer
reserves the right to remove the Registrar upon thirty days'notice and upon the appointment of a
successor Registrar, in which event the predecessor Registrar shall deliver all cash and Bonds in
its possession to the successor Registrar and shall deliver the bond register to the successor
Registrar.
2.4. 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 accreted amount at maturity 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 accreted amount at maturity 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
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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 such Bond, whether such Bond shall be overdue or not,for the purpose of receiving
payment of, or on account of, the accreted amounts on such Bond and for all other
purposes, and all such payments so made to any such registered owner or upon the
owner's order shall be valid and effectual to satisfy and discharge the liability upon such
Bond to the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. For every transfer or exchange of Bonds, the
Registrar may impose a charge upon the owner thereof sufficient to reimburse the
Registrar for any tax, fee or other governmental charge required to be paid with respect to
such transfer or exchange.
(h) Mutilated, Lost, Stolen or Destroyed Bonds. In case any Bond shall become
mutilated or be destroyed, stolen or lost, the Registrar shall deliver a new Bond of like
amount, number, maturity date and tenor in exchange and substitution for and upon
cancellation of any such mutilated Bond or in lieu of and in substitution for any such
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 such 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.
2.5. 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 Manager, provided that all signatures may be printed, engraved or lithographed
facsimiles of the originals. In case any officer whose signature or a facsimile of whose signature
shall appear on the Bonds shall cease to be such officer before the delivery of any Bond, such
signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if he
had remained in office until delivery. Notwithstanding such execution,no Bond shall be valid or
obligatory for any purpose or entitled to any security hereunder until a certificate of
authentication on such 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
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the Bonds have been so prepared, executed and authenticated, the Manager shall deliver the same
to the Purchaser thereof upon payment of the purchase price in accordance with the contract of
sale heretofore made and executed, and the Purchaser shall not be obligated to see to the
application of the purchase price.
2.6. Securities Depository. (a) For purposes of this section the following terms shall
have the following meanings:
"Beneficial Owner" shall mean,whenever used with respect to a Bond,the person in
whose name such Bond is recorded as the beneficial owner of such Bond by a Participant on the
records of such Participant, or such person's subrogee.
"Cede&Co." shall mean Cede&Co.,the nominee of DTC, and any successor nominee
of DTC with respect to the Bonds.
"DTC" shall mean The Depository Trust Company of New York,New York.
"Participant" shall mean any broker-dealer,bank or other financial institution for which
DTC holds Bonds as securities depository.
"Representation Letter" shall mean the Representation Letter pursuant to which the sender
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 accreted 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 accreted amount of each stated maturity 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 accreted amount of each stated maturity 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 accreted amounts on such Bond, and shall
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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 accreted amounts 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
accreted amounts. 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, if not previously filed with DTC, is hereby authorized and directed.
(e) In the event that any transfer or exchange of Bonds is permitted under paragraph(b)
or(c) hereof, such transfer or exchange shall be accomplished upon receipt by the Registrar of
the Bonds to be transferred or exchanged and appropriate instruments of transfer to the permitted
transferee in accordance with the provisions of this resolution. In the event Bonds in the form of
certificates are issued to owners other than Cede&Co.,its successor as nominee for DTC as
owner of all the Bonds, or another securities depository as owner of all the Bonds, the provisions
of this resolution shall also apply to all matters relating thereto,including, without limitation,the
printing of such Bonds in the form of bond certificates and the method of payment of accreted
amounts on such Bonds in the form of bond certificates.
2.7. Form of Bonds. The Bonds shall be printed in substantially the following form:
UNITED STATES OF AMERICA
STATE OF MINNESOTA
HENNEPIN COUNTY
CITY OF EDEN PRAIRIE
GENERAL OBLIGATION WATER AND SEWER REVENUE BOND, SERIES 1998A
(CAPITAL APPRECIATION BOND)
Approximate Date of
Yield to Maturity Maturity Original Issue CUSIP
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REGISTERED OWNER: CEDE&CO.
ACCRETED AMOUNT AT MATURITY:
THE CITY OF EDEN PRAIRIE,HENNEPIN COUNTY,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 accreted amount at maturity specified
above, on the maturity date specified above,being the original principal amount hereof with
interest from the date of original authentication and delivery hereof stated above, accreted and
payable with principal at maturity, at the rate which, compounding on each December 1 and June
1,commencing December 1, 1998,results in said accreted amount at maturity, all subject to the
provisions referred to herein with respect to the redemption of the principal of this Bond prior to
its stated maturity. Reference is made to the table printed on the reverse hereof,which sets forth
the original principal amount of each Bond per$5,000 accreted amount at maturity and its
corresponding accreted value on each December 1 and June 1 to maturity,for the purpose of
determining the accreted amount of this Bond as of any date prior to its designated maturity date.
The accreted amount of the Bond is payable in lawful money of the United States of America by
check or draft to the registered owner upon presentation and surrender hereof at maturity or upon
prior call for redemption, at the principal office of ,in ,Minnesota,
as Registrar and Paying Agent, or its designated successor under the Resolution described herein
(the Registrar) 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)immediately preceding said maturity or redemption
date. For the prompt and full payment of such accreted amounts as the same respectively become
due, the full faith, credit and taxing power of the Issuer have been and are hereby irrevocably
pledged.
This Bond is one of a issue in the aggregate original principal amount of
$ issued pursuant to a resolution adopted by the City Council of the Issuer on
March 17, 1998 (the Resolution), to provide funds to finance the construction of improvements
to the Issuer's municipal water and sewer utility(the System), and is issued pursuant to and in full
conformity with the Constitution and laws of the State of Minnesota thereunto enabling,
including Minnesota Statutes, Chapter 475. The Bonds are issuable only in fully registered form,
in denominations of$5,000 accreted amount at maturity or any integral multiple thereof, of
single maturities.
Bonds having stated maturity dates in 2007 and later years are each subject to redemption
and prepayment at the option of the Issuer,in whole or in part,in such order of maturity dates as
the Issuer shall determine(or,if applicable,by the bond depository in accordance with its
customary procedures) in$5,000 accreted maturity amounts as to Bonds maturing on the same
date, on December 1,2006 and any date thereafter, at a price equal to the accreted amount
thereof and accrued interest to the date of redemption. Bonds in a denomination larger than
$5,000 accreted maturity amount may be redeemed in part in any integral multiple of$5,000
accreted maturity amount. Prior to the date specified for the redemption of any Bond
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prior to its stated maturity date, the Issuer will cause notice of the call for redemption to be
published as required by law, and, at least thirty days prior to the designated redemption date,
will cause notice of the call to be mailed by first class mail (or,if applicable,provided in
accordance with the operational arrangements of the bond depository) to the registered owner of
any Bond to be redeemed at the owner's address as it appears on the bond register maintained by
the Registrar. Upon partial redemption of any Bond, a new Bond or Bonds will be delivered to
the registered owner without charge,in an amount aggregating the remaining accreted amount at
maturity.
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 corporate trust 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 accreted amount at maturity, 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 Obligation, 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 accreted amounts at maturity 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.
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.
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 precedent 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 in regular and due form,time and
manner as so required; that,in and by the Resolution, the Issuer has covenanted and agreed it will
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impose and collect charges for the service, use and availability of the System at the times and in
the amounts required to produce net revenues which,together with any other funds appropriated
by the Issuer, will be not less than five percent in excess of the amounts necessary to pay the
accreted amount at maturity of the Bonds when due; that if necessary for payment of such
accreted amount at maturity of the Bonds, ad valorem taxes are required to be levied upon all
taxable property in the Issuer, without limitation as to rate or amount; that the issuance of this
Bond, together with all other indebtedness of the Issuer outstanding on the date hereof and on the
date of its actual issuance and delivery, does not cause the indebtedness of the Issuer to exceed
any constitutional or statutory limitation of indebtedness; and that the opinion printed hereon is a
full, true and correct copy of the legal opinion given by Bond Counsel with reference to the
Bonds, dated as of the date of original delivery of the Bonds.
IN WITNESS WHEREOF,the Issuer has caused this Bond to be executed on its behalf
by the signatures of the Mayor and Manager.
CITY OF EDEN PRAIRIE,MINNESOTA
(Facsimile signature-Manager) (Facsimile signature-Mayor)
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
Date of Authentication:
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 .............
(Cust) (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
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Additional abbreviations may also be used.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond and all rights thereunder, and does hereby irrevocably constitute and appoint
attorney to transfer the said Bond on the books kept for registration of
the within Bond, with full power of substitution in the premises.
Dated:
NOTICE: The assignor's signature to this
assignment must correspond with the name as
it appears upon the face of the within Bond in
every particular,without alteration or
enlargement or any change whatsoever.
Signature Guaranteed:
Signature(s) must be guaranteed by an "eligible guarantor institution" meeting the requirements
of the 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 form of Bond]
SECTION 3. USE OF PROCEEDS.
4.1. General Obligation Water And Sewer Revenue Bonds,Series 1998A(Capital
Appreciation Bonds) Construction Fund. There is hereby established on the official books and
records of the Issuer a General Obligation Water and Sewer Revenue Bonds,Series 1998A
(Capital Appreciation Bonds) Construction Fund(the Construction Fund), and the Issuer shall
continue to maintain the Construction Fund until payment of all costs and expenses incurred in
connection with the Project financed by the Bonds have been paid. To the Construction Fund
there shall be credited from the proceeds of the Bonds, $ 7,8 70,0 2 7.12 which is the amount
equal to the estimated cost of the acquisition and betterment of the Project and costs of issuance
of the Bonds and from the Construction Fund there shall be paid all construction costs and
expenses and costs of issuance of the Bonds. After payment of all construction costs and costs of
issuance of the Bonds, the Construction Fund shall be discontinued and any Bond proceeds
remaining therein shall be credited to the Bond Fund established by Section 4.2 hereof. All
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proceeds of the Bonds deposited in the Construction Fund will be expended solely for the
payment of the costs of the Project and costs of issuance of the Bonds.
4.2. General Obligation Water And Sewer Revenue Bonds, Series 1998A(Capital
Appreciation Bonds) Bond Fund. There is hereby established on the official books and records
of the Issuer a separate fund designated the General Obligation Water and Sewer Revenue Bonds,
Series 1998A(Capital Appreciation Bonds) Bond Fund(the Bond Fund) and the accreted
amounts on the Bonds shall be payable from the Bond Fund. The Bond Fund shall be maintained
until the Issuer has paid, or made provision for the payment of, all of the accreted amounts on the
Bonds. If the balance on hand in the Bond Fund is at any time insufficient to pay the accreted
amounts then due on the Bonds, such amounts shall be paid from other money 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 money on hand in the Bond Fund from time to time
shall be used only to pay the accreted amounts on the Bonds. Into the Bond Fund shall be paid
(a) all net revenues of the System appropriated to the payment of the accreted amounts on the
Bonds in accordance with Section 4 hereof, (b) any taxes collected pursuant to Section 6 hereof,
and(c) any other funds appropriated by the Council for the payment of the Bonds.
SECTION 4. SUFFICIENCY OF SYSTEM REVENUES. It is hereby found, determined and
declared that the Issuer owns and operates the System as a revenue-producing utility and
convenience and that the net operating revenues of the System, after deducting from the gross
receipts derived from charges for the service,use and availability of the System the expenses of
operation and maintenance thereof(excluding interest, amortization and depreciation),will be
sufficient, with any other funds actually appropriated by the Issuer,for the payment when due of
the accreted amounts on the Bonds herein authorized, and on any other bonds or other
obligations of the Issuer 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 System.
SECTION 5. RATE COVENANT. Pursuant to Minnesota Statutes, Section 444.075, the Issuer
hereby agrees with the registered owners of the Bonds,that until all accreted amounts on the
Bonds are paid in full, or are discharged as provided in Section 7, the Issuer will impose and
collect reasonable charges for the service,use and availability of the System, according to
schedules which will produce net revenues sufficient,with any other funds appropriated by the
Issuer, to pay all accreted amounts when due on the Bonds and any other bonds or other
obligations of the Issuer 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 accreted amounts on the Bonds and shall be credited to the Bond Fund as
required. Nothing herein shall preclude the Issuer from hereafter making further pledges and
appropriations of the net revenues of the System for payment of additional bonds or other
obligations of the Issuer hereafter authorized if the Council determines before the authorization
of such additional obligations that the estimated net revenues of the 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
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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.
SECTION 6. PLEDGE OF TAXING POWERS. For the prompt and full payment of the
accreted amounts on the Bonds as such payments respectively become due, the Issuer hereby
irrevocably pledges its full faith,credit and unlimited taxing powers. However,the Issuer
presently estimates that the net revenues of the System available to be appropriated to the Bond
Fund, together with any other funds to be appropriated by the Issuer to the Bond Fund, will be at
least five percent in excess of the amounts needed to meet when due the accreted amounts
payments on the Bonds and therefore no ad valorem taxes are required to be levied at this time.
SECTION 7. DEFEASANCE. When all of the Bonds have been discharged as provided in this
section, all pledges, covenants and other rights granted by this resolution to the registered owners
of the Bonds shall cease. The Issuer may discharge its obligations with respect to any Bonds
which are due on any date by depositing with the Registrar on or before that date a sum sufficient
for the payment thereof in full; or,if any Bond should not be paid when due,it may nevertheless
be discharged by depositing with the Registrar a sum sufficient for the payment thereof in full
with interest accrued from the due date to the date of such deposit. The Issuer may also 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 maturing on
such dates as shall be required to pay all accreted amounts to become due thereon to maturity or
earlier designated redemption date.
SECTION 8. CERTIFICATION OF PROCEEDINGS.
8.1. Registration. The Finance Director-Clerk is hereby authorized and directed to file
with the County Auditor of Hennepin County a certified copy of this resolution together with
such other information as the County Auditor shall require and to obtain from the County
Auditor a certificate that the Bonds have been entered upon the bond register.
8.2. Certification of Records. 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 of the Issuer relating to the
Bonds and to the financial condition and affairs of the Issuer, 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 they appear from the books and records under the Auditor's custody
and control or as otherwise known to the Auditor, and all such certified copies,certificates and
affidavits, including any heretofore furnished, shall be deemed representations of the Issuer to the
facts recited herein.
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8.3. Official Statement. The Official Statement, dated March 5, 1998, and the
supplement thereto,relating to the Bonds prepared and distributed by Springsted Incorporated,
the financial consultant for the Issuer, is hereby approved. Springsted Incorporated,is hereby
authorized on behalf of the Issuer to prepare and distribute to the Purchaser within seven business
days from the date hereof, a supplement to the Official Statement listing the offering price, the
interest rates, selling compensation, delivery date,the underwriters and such other information
relating to the Bonds required to be included in the Official Statement by Rule 15c2-12 adopted
by the Securities and Exchange Commission under the Securities Exchange Act of 1934. The
officers of the Issuer are hereby authorized and directed to execute such certificates as may be
appropriate concerning the accuracy, completeness and sufficiency of the Official Statement.
SECTION 9. TAX_ COVENANTS; ARBITRAGE MATTERS AND CONTINUING
DISCLOSURE.
9.1. General Tax Covenant. The Issuer agrees with the registered owners from time to
time of the Bonds that it will not take, or Issuer to be taken by any of its officers, employees or
agents, any action 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 agrees 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. All proceeds of the Bonds deposited in the
Construction Fund will be expended solely for the payment of the costs of the Project(or other
improvements to the System authorized pursuant to Minnesota Statutes, Section 444.075). The
System is and will be owned and maintained by the Issuer and available for use by members of
the general public on a substantially equal basis. The Issuer shall not enter into any lease,
management contract,use agreement, capacity agreement or other agreement with any non-
governmental person relating to the use of the System, or any portion thereof, or security for the
payment of the Bonds which might cause the Bonds to be considered "private activity bonds" or
"private loan bonds" pursuant to Section 141 of the Code.
9.2. Certification. The Mayor and Manager being the officers of the Issuer charged with
the responsibility for issuing the Bonds pursuant to this Resolution, are authorized and directed
to execute and deliver to the Purchaser a certificate in accordance with Section 148 of the Code,
and applicable Regulations, stating the facts, estimates and circumstances in existence on the
date of issue and delivery of the Bonds which make it reasonable to expect that the proceeds of
the Bonds will not be used in a manner that would cause the Bonds to be "arbitrage bonds"
within the meaning of the Code and Regulations.
9.3. Arbitrage Rebate. The Issuer acknowledges that the Bonds are subject to the rebate
requirements of Section 148(f) of the Code. The Issuer covenants and agrees to retain such
records,make such determinations, file such reports and documents and pay such amounts at
such times as are required under said Section 148(f) and applicable Regulations to preserve the
exclusion of interest on the Bonds from gross income for federal income tax purposes,unless the
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Bonds qualify for an exception from the rebate requirement pursuant to one of the spending
exceptions set forth in Section 1.148-7 of the Regulations and no "gross proceeds" of the Bonds
(other than amounts constituting a"bona fide debt service fund") arise during or after the
expenditure of the original proceeds thereof.
9.4. 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 Issuer
hereby makes the following covenants and agreements for the benefit of the Owners (as
hereinafter defined) from time to time of the Outstanding Bonds. The Issuer is the only obligated
person in respect of the Bonds within the meaning of the Rule for purposes of identifying the
entities in respect of which continuing disclosure must be made. The Issuer has complied in all
material respects with any undertaking previously entered into by it under the Rule. If the Issuer
fails to comply with any provisions of this section, any person aggrieved thereby, including the
Owners of any Outstanding Bonds, may take whatever action at law or in equity may appear
necessary or appropriate to enforce performance and observance of any agreement or covenant
contained in this section,including an action for a writ of mandamus or specific performance.
Direct,indirect, consequential and punitive damages shall not be recoverable for any default
hereunder to the extent permitted by law. Notwithstanding anything to the contrary contained
herein, in no event shall a default under this section constitute a default under the Bonds or under
any other provision of this resolution. As used in this section,Owner or Bondowner means, in
respect of a Bond, the registered owner or owners thereof appearing in the bond register
maintained by the Registrar or any Beneficial Owner(as hereinafter defined)thereof, if such
Beneficial Owner provides to the Registrar evidence of such beneficial ownership in form and
substance reasonably satisfactory to the Registrar. As used herein,Beneficial Owner means,in
respect of a Bond, any person or entity which(i)has the power, directly or indirectly, to vote or
consent with respect to, or to dispose of ownership of, such Bond(including persons or entities
holding Bonds through nominees, depositories or other intermediaries), or(b)is treated as the
owner of the Bond for federal income tax purposes.
(b) Information To Be Disclosed. The Issuer will provide,in the manner set forth in subsection
(c) hereof, either directly or indirectly through an agent designated by the Issuer, the following
information at the following times:
(1) on or before 365 days after the end of each fiscal year of the Issuer,
commencing with the fiscal year ending December 31, 1998, the following financial
information and operating data in respect of the Issuer(the Disclosure Information):
(A) the audited financial statements of the Issuer for such fiscal year,
containing balance sheets as of the end of such fiscal year and a statement of
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operations, changes in fund balances and cash flows for the fiscal year then ended,
showing in comparative form such figures for the preceding fiscal year of the
Issuer, prepared in accordance with generally accepted accounting principles
promulgated by the Financial Accounting Standards Board as modified in
accordance with the governmental accounting standards promulgated by the
Governmental Accounting Standards Board or as otherwise provided under
Minnesota law, as in effect from time to time, or,if and to the extent such
financial statements have not been prepared in accordance with such generally
accepted accounting principles for reasons beyond the reasonable control of the
Issuer, noting the discrepancies therefrom and the effect thereof,and certified as
to accuracy and completeness in all material respects by the fiscal officer of the
Issuer; and
(B) to the extent not included in the financial statements referred to in
paragraph(A) hereof,the information for such fiscal year or for the period most
recently available of the type contained in the Official Statement under headings:
City Property Values; City Indebtedness; and City Tax Rates,Levies and
Collections.
Notwithstanding the foregoing paragraph,if the audited financial statements are not available by
the date specified, the Issuer shall provide on or before such date unaudited financial statements
in the format required for the audited financial statements as part of the Disclosure Information
and, within 10 days after the receipt thereof, the Issuer shall provide the audited financial
statements. Any or all of the Disclosure Information may be incorporated by reference, if it is
updated as required hereby, from other documents, including official statements, which have
been submitted to each of the repositories hereinafter referred to under subsection(c) or the SEC.
If the document incorporated by reference is a final official statement,it must be available from
the Municipal Securities Rulemaking Board. The Issuer shall clearly identify in the Disclosure
Information each document so incorporated by reference. If any part of the Disclosure
Information can no longer be generated because the operations of the Issuer have materially
changed or been discontinued, such Disclosure Information need no longer be provided if the
Issuer includes in the Disclosure Information a statement to such effect;provided,however, if
such operations have been replaced by other Issuer operations in respect of which data is not
included in the Disclosure Information and the Issuer determines that certain specified data
regarding such replacement operations would be a Material Fact(as defined in paragraph(2)
hereof), then, from and after such determination, the Disclosure Information shall include such
additional specified data regarding the replacement operations. If the Disclosure Information is
changed or this section is amended as permitted by this paragraph(b)(1) or subsection (d), then
the Issuer shall include in the next Disclosure Information to be delivered hereunder, to the
extent necessary, an explanation of the reasons for the amendment and the effect of any change in
the type of financial information or operating data provided.
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(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.
(3) In a timely manner, notice of the occurrence of any of the following events or
conditions:
(A) the failure of the Issuer to provide the Disclosure Information
required under paragraph (b)(1) at the time specified thereunder;
(B) the amendment or supplementing of this section pursuant to
subsection (d), together with a copy of such amendment or supplement and any
explanation provided by the Issuer under subsection(d)(2);
(C) the termination of the obligations of the Issuer under this section
pursuant to subsection(d);
(D) any change in the accounting principles pursuant to which the
financial statements constituting a portion of the Disclosure Information are
prepared; and
(E) any change in the fiscal year of the Issuer.
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s
(c) Manner of Disclosure. The Issuer agrees to make available the information described in
subsection (b) to the following entities by telecopy, overnight delivery,mail or other means, as
appropriate:
(1) the information described in paragraph(1) of subsection(b),to each then
nationally recognized municipal securities information repository under the Rule and to
any state information depository then designated or operated by the State of Minnesota as
contemplated by the Rule(the State Depository),if any;
(2) the information described in paragraphs (2) and(3) of subsection(b), to the
Municipal Securities Rulemaking Board and to the State Depository,if any; and
(3) the information described in subsection(b),to any rating agency then
maintaining a rating of the Bonds at the request of the Issuer and, at the expense of such
Bondowner, to any Bondowner who requests in writing such information, at the time of
transmission under paragraphs (1) or(2) of this subsection(c), as the case may be, or,if
such information is transmitted with a subsequent time of release, at the time such
information is to be released.
(d) Term, Amendments; Interpretation.
(1) The covenants of the Issuer in this section shall remain in effect so long as
any Bonds are Outstanding. Notwithstanding the preceding sentence,however, the
obligations of the Issuer under this section shall terminate and be without further effect as
of any date on which the Issuer delivers to the Registrar an opinion of Bond Counsel to
the effect that, because of legislative action or final judicial or administrative actions or
proceedings, the failure of the Issuer to comply with the requirements of this section will
not cause participating underwriters in the primary offering of the Bonds to be in
violation of the Rule or other applicable requirements of the Securities Exchange Act of
1934, as amended, or any statutes or laws successory thereto or amendatory thereof.
(2) This section (and the form and requirements of the Disclosure Information)
may be amended or supplemented by the Issuer from time to time, without notice to
(except as provided in paragraph(c)(3) hereof) or the consent of the Owners of any
Bonds,by a resolution of this Board filed in the office of the recording officer of the
Issuer accompanied by an opinion of Bond Counsel, who may rely on certificates of the
Issuer and others and the opinion may be subject to customary qualifications, to the effect
that: (i) such amendment or supplement(a)is made in connection with a change in
circumstances that arises from a change in law or regulation or a change in the identity,
nature or status of the Issuer or the type of operations conducted by the Issuer, or(b)is
required by, or better complies with, the provisions of paragraph(b)(5) of the Rule; (ii)
this section as so amended or supplemented would have complied with the requirements
of paragraph (b)(5) of the Rule at the time of the primary offering of the Bonds, giving
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t
effect to any change in circumstances applicable under clause(i)(a) and assuming that the
Rule as in effect and interpreted at the time of the amendment or supplement was in effect
at the time of the primary offering; and(iii) such amendment or supplement does not
materially impair the interests of the Bondowners under the Rule.
If the Disclosure Information is so amended,the Issuer agrees to provide,
contemporaneously with the effectiveness of such amendment, an explanation of the
reasons for the amendment and the effect,if any, of the change in the type of financial
information or operating data being provided hereunder.
(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.
Upon vote being taken thereon, the following voted in favor thereof:
Case, Thorfinnson, Jr. , Butcher-Younghans and Harris
and the following voted against the same: None
whereupon the resolution was declared duly passed and adopted.
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