HomeMy WebLinkAboutResolution No. 2003-022 $3,2000,000 GO Water & Sewer bond Series 2003C The following abbreviations, when used in the inscription on the face of this
Bond, shall be construed as though they were written out in full according to applicable laws or
regulations:
TEN COM——as tenants UNIF TRANS MIN ACT. . . . . . . Custodian. . . . . . . .
in common (Gust) (Minor)
TEN ENT——as tenants under Uniform Transfers to Minors
by the entireties Act. . . . . . . . . . . . . . . . . . . . . .
(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
hereby irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for registration thereof, with full power of
substitution in the premises.
Dated:
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE: NOTICE: The signature(s)to this assignment
must correspond with the name as it appears
upon the face of the within Bond in every
particular,without alteration, enlargement or
any change whatsoever.
Signature(s)must be guaranteed by an
"eligible guarantor institution"
meeting the requirements of the
Bond Registrar, which requirements
include membership or participation
in the Securities Transfer Association
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.4
Medalion Program(STAMP) or such
other"signature guaranty program"
as may be determined by the Bond
Registrar in addition to or in
substitution for STAMP, all in
accordance with the Securities
Exchange Act of 1934, as amended.
[End of Bond Form]
Section 3. Bond Terms, Execution and Delivery.
3.01. Maturities, Interest Rates, Denominations, Payment, Dating of Bonds. The
City shall forthwith issue and deliver the Bonds,which shall be denominated"General
Obligation Water and Sewer Revenue Bonds, Series 2003C." The Bonds shall be dated as of
March 1, 2003, shall be issuable in the denominations of$5,000 or any integral multiple thereof,
shall mature on February 1 in the years and amounts set forth below, and Bonds maturing in such
years and amounts shall bear interest from date of issue until paid or duly called for redemption
at the rates per annum set forth opposite such years and amounts as follows:
• Year Amount Rate Year Amount Rate
2004 $290,000 1.10% 2009 $320,000 2.85%
2005 285,000 1.30 2010 330,000 3.05
2006 290,000 1.65 2011 345,000 3.30
2007 300,000 2.05 2012 360,000 3.45
2008 310,000 2.45 2013 370,000 3.55
The Bonds shall be issuable only in fully registered form, of single maturities.
The interest thereon and,upon surrender of each Bond at the principal office of the Registrar
described herein, the principal amount thereof, shall be payable by check or draft issued by the
Registrar. Each Bond shall be dated by the Registrar as of the date of its authentication.
3.02. Interest Payment Dates. Interest on the Bonds shall be payable on
February 1 and August 1 in each year, commencing August 1, 2003,to the owners thereof as
such appear of record in the bond register as of the close of business on the fifteenth day of the
immediately preceding month, whether or not such day is a business day. Interest on the Bonds
will be computed on the basis of a 360-day year consisting of twelve 30-day months and will be
rounded pursuant to the rules of the Municipal Securities Rulemaking Board.
3.03. Registration. The City shall appoint, and shall maintain, a bond registrar,
transfer agent and paying agent(the Registrar). The effect of registration and the rights and
duties of the City and the Registrar with respect thereto shall be as follows:
(a) Register. The Registrar shall keep at its principal office a bond register in
which the Registrar shall provide for the registration of ownership of Bonds and the
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registration of transfers and exchanges of Bonds entitled to be registered, transferred or
exchanged.
(b) Transfer of Bonds. Upon surrender to the Registrar 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 Bond is surrendered by the registered
owner for exchange, the Registrar shall authenticate and deliver one or more new Bonds
of a like aggregate principal amount, interest rate and maturity, as requested by the
registered owner or the owner's attorney duly authorized in writing.
(d) Cancellation. All Bonds surrendered upon any transfer or exchange shall be
promptly cancelled by the Registrar and thereafter disposed of as directed by the City.
(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
its refusal, in good faith,to make transfers which it, in its judgment, deems improper or
unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in
whose name 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 principal of and interest 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 of the City
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 (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 with respect to such transfer or exchange.
(h) Mutilated, Lost, Stolen or Destroyed Bonds. In case any Bond shall become
mutilated or be lost, stolen or destroyed,the Registrar shall deliver a new Bond of like
amount, number, interest rate, 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 lost, stolen or destroyed, upon the payment of the reasonable expenses and
charges of the Registrar in connection therewith; and, in the case of a Bond lost, stolen or
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destroyed, upon receipt by the Registrar of evidence satisfactory to it that such Bond was
lost, stolen or destroyed, and of the ownership thereof, and upon receipt by the Registrar
of an appropriate bond or indemnity in form, substance and amount satisfactory to it, in
which both the City and the Registrar shall be named as obligees. All Bonds so
surrendered to the Registrar shall be cancelled by it and evidence of such cancellation
shall be given to the City. If the mutilated, lost, stolen or destroyed 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.
3.04. Appointment of Initial Registrar. The City hereby appoints U.S. Bank
National Association in St. Paul, Minnesota, as the initial Registrar. The Mayor and City
Finance Director are authorized to execute and deliver, on behalf of the City, a contract with U.S.
Bank National Association, as 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
City agrees to pay the reasonable and customary charges of the Registrar for the services
performed. The City reserves the right to remove any Registrar upon thirty(30) 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. On or before each
principal or interest due date, without further order of this Council,the City Finance Director
shall transmit to the Registrar from the 2003 Utility Bond Fund described in Section 4 hereof,
moneys sufficient for the payment of all principal and interest then due.
3.05. Redemption. Bonds maturing in the years 2004 through 2010 are payable
on their respective stated maturity dates without option of prior payment,but Bonds maturing in
2011 and thereafter are each subject to redemption, at the option of the City and in whole or in
part, and if in part, in the maturities selected by the City and,within any maturity, in$5,000
principal amounts selected by the Registrar by lot, on February 1, 2010 and on any date
thereafter, at a redemption price equal to the principal amount thereof to be redeemed plus
accrued interest to the date of redemption.
At least thirty days prior to the date set for redemption of any Bond,the City shall
cause notice of the call for redemption to be mailed to the Registrar and to the registered owner
of each Bond to be redeemed, 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. The notice of redemption shall specify the redemption date,
redemption price,the numbers, interest rates and CUSIP numbers of the Bonds to be redeemed
and the place at which the Bonds are to be surrendered for payment, which is the principal office
of the Registrar. Official notice of redemption having been given as aforesaid, the Bonds or
portions thereof so to be redeemed shall, on the redemption date, become due and payable at the
redemption price therein specified and from and after such date (unless the City shall default in
the payment of the redemption price) such Bonds or portions thereof shall cease to bear interest.
Bonds in a denomination larger than $5,000 may be redeemed in part in any
integral multiple of$5,000. The owner of any Bond redeemed in part shall receive without
charge, upon surrender of such Bond to the Registrar, one or more new Bonds in authorized
denominations equal in principal amount to be unredeemed portion of the Bond so surrendered.
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the City in connection with the issuance of the Bonds. Upon completion and payment of all
costs of the Improvements, any balance of the proceeds of Bonds remaining in the Construction
Fund may be used to pay the cost, in whole or in part, of any other improvements to the Utility,
as directed by the City Council, but any balance of such proceeds not so used shall be credited
and paid to the Bond Fund.
4.02. 2003 Utility Bond Fund. So long as any of the Bonds are outstanding and
any principal of or interest thereon unpaid,the City Finance Director shall maintain on its books
and records a separate and special bookkeeping fund designated"2003 Utility Bond Fund" (the
"Bond Fund")to be used for no purpose other than the payment of the principal of and interest
on the Bonds and any additional obligations of the City payable therefrom pursuant to Section
4.03 hereof. If the balance in the Bond Fund is ever insufficient to pay all principal and interest
then due on bonds payable therefrom,the City Finance Director shall nevertheless provide
sufficient money from any other funds of the City which are available for that purpose, and such
other funds shall be reimbursed from subsequent receipts of net revenues of the Utility
appropriated to the Bond Fund and, if necessary, from the proceeds of the taxes levied for the
Bond Fund. The City hereby appropriates to the Bond Fund the accrued interest on the Bonds
and any amount in excess of$3,168,000 received from the Purchaser upon delivery of the Bonds
and any amounts transferred to the Bond Fund pursuant to Section 4.01 hereof. The City
Finance Director shall deposit in the Bond Fund the proceeds of all taxes levied and all other
money which may at any time be received for or appropriated to the payment of such bonds and
• interest, including the net revenues of the Utility herein pledged and appropriated to the Bond
Fund, all collections of any ad valorem taxes levied for the payment of the Bonds, and all other
moneys received for or appropriated to the payment of the Bonds and interest thereon.
There are hereby established two accounts in the Bond Fund, designated as the
"Debt Service Account"and the "Surplus Account." All money appropriated or to be deposited
in the Bond Fund shall be deposited as received into the Debt Service Account. On each
February 1, the City Finance Director shall determine the amount on hand in the Debt Service
Account. If such amount is in excess of one-twelfth of the debt service payable from the Bond
Fund in the immediately preceding 12 months,the City Finance Director shall promptly transfer
the amount in excess to the Surplus Account. The City appropriates to the Surplus Account any
amounts to be transferred thereto from the Debt Service Account as herein provided and all
income derived from the investment of amounts on hand in the Surplus Account. If at any time
the amount on hand in the Debt Service Account is insufficient to meet the requirements of the
Bond Fund,the City Finance Director shall transfer to the Debt Service Account amounts on
hand in the Surplus Account to the extent necessary to cure such deficiency.
4.03. Imposition of Charizes; Additional Bonds. The City hereby covenants and
agrees with the holders from time to time of the Bonds that so long as any of the Bonds are
outstanding,the City will impose and collect reasonable charges for the service, use and
availability of the Utility to the City and its inhabitants according to schedules calculated to
produce net revenues which, will be sufficient to pay all principal and interest when due on the
Bonds and all other obligations payable from the net revenues of the Utility, and said net
revenues, to the extent necessary, are hereby irrevocably pledged and appropriated to the
payment of the Bonds and interest thereon. The pledge and appropriation of net revenues of the
Utility herein made is on a parity with the pledge and appropriation of such net revenues to pay
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the outstanding obligations of the City payable from the net revenues of the Utility. Nothing
herein shall preclude the City from hereafter making further pledges and appropriations of net
revenues of the Utility for the payment of additional 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 Utility will be sufficient,together with any other sources pledged
to or projected to be used, for the payment of the principal of and interest on the Bonds and paid
therefrom 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 herein made, as to the application of net revenues received from time to time.
4.04. Full Faith and Credit Pledged. The full faith and credit of the City are
irrevocably pledged for the prompt and full payment of the principal of and the interest on the
Bonds and any other obligations payable from the Bond Fund, as such principal and interest
comes due. If the money on hand in the Bond Fund should at any time be insufficient for the
payment of principal and interest then due,this City shall pay the principal and interest out of
any fund of the City, and such other fund or funds shall be reimbursed therefor when sufficient
money is available to the Bond Fund. If on October 1 in any year the sum of the balance in the
Bond Fund plus the available net revenues of the Utility on hand and estimated to be received or
before the end of the following calendar year is not sufficient with any ad valorem taxes
heretofore levied in accordance with the provisions of this resolution, to pay when due all
principal and interest become due on all Bonds payable therefrom in said following calendar
year, or the Bond Fund has incurred a deficiency in the manner provided in this Section 4.04, a
direct, irrepealable, ad valorem tax shall be levied on all taxable property within the corporate
limits of the City for the purpose of restoring such accumulated or anticipated deficiency in an
amount at least 5%in excess of amount needed to make good the deficiency.
Section 5. Defeasance. When any Bond has been discharged as provided in this
Section 5, all pledges, covenants and other rights granted by this resolution to the holders of such
Bonds shall cease, and such Bonds shall no longer be deemed outstanding under this Resolution.
The City may discharge its obligations with respect to any Bond which is due on any date by
irrevocably 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,the City may nevertheless discharge
its obligations with respect thereto by depositing with the Registrar a sum sufficient for the
payment thereof in full with interest accrued to the date of such deposit. The City 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 times and at such rates and
maturing on such dates as shall be required, without reinvestment,to pay all principal and
interest to become due thereon to maturity or, if notice of redemption as herein required has been
duly provided for, to such earlier redemption date.
Section 6. County Auditor Registration, Certification of Proceedings, Investment
of Money, Arbitrage, Official Statement and Fees.
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• Therefore, pursuant to the provisions of Section 148(f)(4)(D) of the Code,the City shall not be
required to comply with the arbitrage rebate requirements of paragraphs (2) and (3) of Section
148(f) of the Code with respect to the Bonds.
6.05. Interest Disallowance. The City hereby designates the Bonds as "qualified
tax-exempt obligations" for purpose of Section 265(b) of the Code relating to the disallowance of
interest expenses for financial institutions. The City represents that in calendar year 2003 it does
not reasonably expect to issue tax-exempt obligations which are not private activity bonds (not
treating qualified 501(c)(3)bonds under Section 145 of the Code as private activity bonds for
purposes of this representation) or refunding bonds not taken into account under Section
265(b)(3)(C)(ii)(III) in an amount in excess of$10,000,000.
6.06. Arbitrage Certification. The Mayor and the City Manager, being the
officers of the City charged with the responsibility for issuing the Bonds pursuant to this
resolution, are authorized and directed to execute and deliver to the Purchaser a certification in
accordance with the provisions of Section 148 of the Code, and the 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.
6.07. Official Statement. The Official Statement relating to the Bonds, dated
February 6, 2003, prepared and distributed on behalf of the City by Ehlers &Associates, Inc., is
• hereby approved. Ehlers&Associates, Inc. is hereby authorized on behalf of the City to prepare
and distribute to the Purchaser 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 Certificates required to be included in the Official Statement by Rule
li 15c2-12 adopted by the Securities and Exchange Commission under the Securities Exchange Act
of 1934. Within seven business days from the date hereof,the City shall deliver to the Purchaser
a reasonable number of copies of the Official Statement and such supplement. The officers of
the City are hereby authorized and directed to execute such certificates as may be appropriate
concerning the accuracy, completeness and sufficiency of the Official Statement.
Section 7. 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 original purchaser
and other participating underwriters in the primary offering of the Bonds to comply with
amendments to Rule 15c2-12 promulgated by the Securities and Exchange Commission(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.
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(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 City to provide the Disclosure Information required
under paragraph(b)(1) at the time specified thereunder;
(B) the amendment or supplementing of this Section 7 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 7
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
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• 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 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 7 shall remain in effect so long as any
Bonds are Outstanding. Notwithstanding the preceding sentence, however, the obligations of the
City under this Section 7 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 7 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 7 (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 the City
Council filed in the office of the City Clerk 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 7 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.
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(3) This Section 7 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.
Dennis Maetzold
Mayor
Attest:
Debra Man en
City Clerk
The motion for the adoption of the foregoing resolution was duly seconded by
Councilmember Hovland, and upon vote being taken thereon, the following voted in favor
thereof:
Housh, Hovland, Masica, Kelly
and the following voted against the same:
None
whereupon said resolution was declared duly passed and adopted, and was signed by the Mayor
which signature was attested by the City Clerk.
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