CR 02-181 Tax Increment Financing and Permanent Improvement Bonds
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, G \ T Y OF
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November 15,2002 I-tOPK1NS Council Report 02-l8I
. AWARD SALE OF BONDS - G.O, TAX INCREMENT FINANCING BONDS, SERIES 2002A AND
G,O. PERMANENT IMPROVEMENT REVOLVING FUND BONDS, SERIES 2002B
Proposed Action
Staff reconunends approval of the following motion: Approve resolution No. 02-106 awarding the sale of
$2,490.000 General Obligation Tax Increment Financing Bonds. Series 2002A. for a portion of
improvements to the Excelsior Blvd proiect east ofHwy 169, resolution No. 02-107 awardil1l? the sale of
$960.000 General Obligation Permanent Improvement Revolvinf2. Fund Bonds, Series 2002B, for a portion
of the Lot 500/600 improvements and a portion of the 2001 street improvement proi eets.
With this motion, the sale of the bonds will be a\varded based on the recommendation of Ehlers and
Associates, Inc., financial advisor for this project.
Overview
Tax Increment Financing Bonds: The City of Hopkins will issue G.O. Tax Increment Financing Bonds in the
amount of $2,490,000. The City has the authority to issue tax increment bonds to pay for specific improvements
in a redevelopment tax increment projcct area. The cun'cnt County Road Three/Excelsior Blvd improvement
project qualifies for tax increment bond issuance.
Permanent Improvement Revolving Fund Bonds: The City of Hupkins will issue PIR fund bonds in the
. amount of $960.000. The city has the authority to issue Permanent Improvcment Revolving fund bonds to pay
for any improvement of which the cost is to be partially assessed. The assessment of $ J 64,191 for street
improvement project No. 98-12 and the assessment of $51 0,626 for streeet improvement project No. 00-10,
exceeds the 20% threshold required for the issuance of bonds.
At the November 5th, 2002 Council Meeting, the Council authorized the salc of bonds for the County Road
Three/Excelsior Blvd. Improvement projed and the Permanent Improvement Revolving fund capital
improvement projects. The bids will be accepted until 1 1 :00 al11 on November 19,2002 at which time they will
be reviewed and the recol11mendation incorporated into Resolution 02- I 06 and 02-107 respectivcly.
Primary Issues to Consider
At this timc, there do not appear to be any primary issues relating to the award of the bond sales. Any
significant issues affecting the sale will not be known until after the closing of the bids on November 19[",2002.
Supportinl! Information
. Resolution No. 02-106
. Resolution No. 02~ 107
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Lori Yager ~ ~-.~_~L"'__..
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Finance Director
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. CITY OF HOPKINS, MINNESOTA
RESOLUTION NO. 2002-106
A RESOLUTION AWARDING THE SALE OF $2,490,000
GENERAL OBLIGATION TAX INCREMENT BONDS, SERIES 2002A;
FIXING THEIR FORM AND SPECIFICA nONS;
DIRECTING THEIR EXECUTION AND DELrvERY;
AND PROVIDING FOR THEIR PAYMENT
BE IT RESOLVED By the City Council of the City of Hopkins, Helmepin COU11ty,
Mim1esota (City) as follows:
Section 1. Sale of Bonds.
1.01. It is hereby detennined that:
(a) the City and the Housing and Redevelopment AuthOlity in and for the City
of Hopkins (HRA) have adopted a tax increment financing plan (TIP Plan) for Tax
Increment Financing Dish-ict No, 2-11 (TIF Distlict) within Redevelopment Project No. 1
(Project).
. (b) the City is authOlized by Section 469.178 of the TIF Act to issue and sell its
general obligations to pay all or a portion of the public redevelopment costs (Costs) related
to the Project as identified i11 the redevelopment plan and TIF plan for the TIF District.
(c) the following Costs to be financed by the Bonds are authorized by the TIF
Plan:
Public improvements (Excelsior Blvd lnterchange $ 2,427,630
within TIF Distlict)
Bond Discount 32,3 70
Cost ofIssuance 30,000
TOTAL 2,490,000
(d) it is necessary and expedient to the sound financial management of the
affairs of the City to issue $2,490,000 General Obligation Tax Increment Bonds, Series
2002A (Bonds) to provide financing for the Costs.
(e) The staff of the City and the HRA have prepared a form of Tax Increment
Pledge Agreement (TIF Agreement) under which the HRA agrees to make tax increments
from Tax Increment District No.2-II available to the City to pay principal of and interest
. on the bonds authOlized by this Resolution. The f01111 of the Tax increment Agreement is
approved. The Mayor and City Clerk are authOlized and directed to execute and deliver the
TIF Agreement on behalf ofthe City.
sm-223445vl
HP 110-66
. 1.02. The proposal of (Purchaser) to
purchase $2,490,000 General Obligation Tax Increment Bonds, Series 2002 (Bonds) of the City
described in the Temls of Proposal thereof is found and detemlined to be a reasonable offer and is
hereby accepted, the proposal being to purchase the Bonds at a price of $ plus
accrued interest to date of delivery, for Bonds bearing interest as follows:
Year of Interest Year of Interest
Maturity Rate Maturity Rate
2004 2014
2005 2015
2006 2016
2007 2017
2008 2018
2009 2019
2010 2020
2011 2021
2012 2022
2013 2023
Tme interest cost:
. 1.03. The sum of $ being the amount proposed by the Purchaser in excess of
$2,457,630 will be credited to the Debt Service Fund hereinafter created. The City Finance Director
is directed to retain the good faith check of the Purchaser, pending completion of the sale of the
Bonds, and to retum the good faitb checks of the unsuccessful proposers forthwith. Tht: Mayor and
City Finance Director are directed to execute a contract with the Purchaser on behalf ofthe City.
1.04. The City will forthwith issue and sell the Bonds pmsuant to MilU1esota Statutes,
Chapter 469 and 475 (collectively, the Act), in the total principal amount of $2,490,000, Oliginally
dated as of the date of delivery, in the denomination of$5,000 each or any inte,!:,'ral multiple thereof,
numbered No. R-I, upward, bealing interest as above set [01ih, and maturing seIially on February 1
in the years and amounts as follows:
Year Amount Year Amount
2004 70,000 2014 120,000
2005 85,000 20]5 125,000
2006 90,000 2016 135,000
2007 90,000 2017 140,000
2008 95,000 2018 150,000
2009 100,000 2019 155,000
2010 100,000 2020 165,000
2011 105,000 2021 170,000
2012 110,000 2022 180,000
. 2013 115,000 2023 190,000
Optional Redemption. The City may elect on FeblUary 1, 2013 and on any day
1.05.
thereafter to prepay Bonds due on or after February 1,2014. Redemption may be in whole or in
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. part and if in pat1, at the option of the City and in such mam1er as the City will detennine. If less
than all Bonds of a matmity are called for redemption, the City will notify DTC (as defined in
Section 7 hereof) of the pal1icular amount of such maturity to be prepaid. DTC will detennine by
lot the amount of each paIticipant's interest in such maturity to be redeemed and each participant
will then select by lot the beneficial ownership interests in such maturity to be redeemed.
Prepayments will be at a price of par plus accrued interest.
Section 2. Registration and Payment.
2.01. Registered F ann. The Bonds will be issued only in fully registered f01111. The
interest thereon aI1d, upon sUlTender of each Bond, the principal amount thereof, is payable by check
or draft issued by the Registrar described herein.
2.02. Dates: Interest Payment Dates. Each Bond will be dated as of the last interest
payment date preceding the date of authentication to which interest on the Bond has been paid or
made available for payment, unless (i) the date of authentication is an interest payment date to
which interest has been paid or made available for payment, in which case the Bond will be dated as
of the date of authentication, or Oi) the date of autbentication is prior to the first interest payment
date, in which case the Bond wi II be dated as of the date of original issue. The interest on the Bonds
is payable on February 1 and August 1 of each year, commencing August 1,2003, to the registered
owners of record as of the close of business on the fifteenth day of the immediately preceding
month, whether or not that day is a business day.
. 2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating
agent and paying agent (Registrar). The effect of registration and the rights and duties of the City
and the Registrar with respect thereto are as follows:
(a) Register. The Registrar must keep at its principal corporate trust office a
bond register in which the Registrar provides for the registration of ownership of Bonds and
the registration of transfers and exchanges of Bonds entitled to be registered, transfened or
exchanged.
(b) Transfer of Bonds. Upon sun-ender for transfer of a Bond duly endorsed by
the registered owner tbereof or accompanied by a wIitten instrument of transfer, in fonn
satisfactOlY to the Registrar, duly executed by the registered owner thereof or by an attomey
duly authOlized by the registered owner in wliting, the Registrar will authenticate and
deliver, in the name of the designated transferee or transferees, one or more new Bonds of a
like aggregate principal amount and matmity, as requested by the transferor. The Registrar
may, however, close the books for registration of any transfer after the fifteenth day of the
month preceding each interest payment date and until that interest payment date.
(c) Exchange of Bonds. When Bonds are surrendered by the registered owner
for excl1ange the Registrar will authenticate and deliver one or more new Bonds of a like
aggregate plincipal amount and maturity as requested by the registered owner or the owner's
. attomey in wliting.
(d) Cancellation. Bonds sUlTendered upon transfer or exchange will be promptly
cancelled by the Registrar and thereafter disposed of as directed by the City.
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. (e) Improper or Unauthorized Transfer. When a Bond is presented to the
Registrar for h-ansfer, the Registrar may refuse to transfer the Bond until the Regish-ar 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 will incur no
liability for the refusal, in good faith, to make transfers which it, in its judgment, deems
improper or unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in
whose name a Bond is registered in the bond register as the absolute owner of the Bond,
whether the Bond is overdue or not, for the purpose of receiving payment of, or on account
of, the principal of and interest on the Bond and for all other purposes, and payments so
made to a registered owner or upon the owner's order will be valid and effectual to satisfy
and discharge the liability upon the Bond to the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. The Registrar may impose a charge upon the
owner thereof for a transfer or exchange of Bonds sufficient to reimburse the Registrar for
any tax, fee or other govenunental charge required to be paid with respect to the transfer or
exchange.
(h) Mutilated, Lost, Stolen or Destroyed Bonds. If a Bond becomes mutilated or
is destroyed, stolen or lost, the Registrar will deliver a new Bond of like amount, number,
. maturity date and tenor in exchange and substitution for and upon cancellation of the
mutilated Bond or in lieu of and in substitution for a Bond desh-oyed, 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 an appropriate bond or indenmity in fonn,
substance and amount satisfactory to the Registrar, in which both the City and the Registrar
must be named as obligees. Bonds so surrendered to the Regish'ar will be cancelled by the
Registrar and evidence of such cancellation must be given to the City. If the mutilated,
destroyed, stolen or lost Bond has already matured or been called for redemption in
accordance with its te1111S it is not necessary to issue a new Bond Plior to payment.
(i) Redemption. In the event any of the Bonds are called for redemption, notice
thereof identifying the Bonds to be redeemed will be given by the Registrar by mailing a
copy of the redemption notice by first class mail (postage prepaid) not more than 60 and not
less than 30 days Plior to the date fixed for redemption to the registered owner of each Bond
to be redeemed at tbe address shown on the registration books kept by the Registrar and by
publishing the notice if required by law. Failure to give notice by publication or by mail to
any registered owner, or any defect therein, will not affect the validity of the proceedings for
the redemption of Bonds. Bonds so called for redemption will cease to bear interest after
the specified redemption date, provided that the funds for the redemption are on deposit with
the place of payment at that time.
. 2.04. Appointment of Initial Registrar. The City appoints Bankers Trust Company, Des
Moines, Iowa, as the initial Registrar. The Mayor and the City Manager are authOIlzed to execute
and deliver, on behalf of the City, a contract with the Registrar. Upon merger or consolidation of
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. the Registrar with another corporation, if the resulting corporation is a bank or hust company
authorized by law to conduct such business, the resulting corporation is authorized to act as
successor Registrar. The City agrees to pay the reasonable and custommy charges of the Registrar
for the services performed. The City reserves the right to remove the Registrar upon 30 days' notice
and upon the appoinhnent of a successor Registrar, in which event the predecessor Registrar must
deliver all cash and Bonds in its possession to the successor Registrar and must deliver the bond
register to the successor Registrar. On or before each Plincipal or interest due date, without further
order ofthis Council, the City Finance Director must transmit to the Registrar moneys sufficient for
the payment of all principal and interest then due.
2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the
direction ofthe City Manager and executed on behalf of the City by the signatures of the Mayor and
the City Manager, provided that all signatures may be printed, engraved or lithographed facsimiles
of the originals. If an officer whose signature or a facsimile of whose signature appears on the
Bonds ceases to be such officer before the delivelY of any Bond, that signature or facsimile will
neveriheless be valid and sufficient for all purposes, the same as if the officer had remained in office
until delivery. Notwithstanding such execution, a Bond will not be valid or obligatory for any
purpose or entitled to any security or benefit under this Resolution unless and until a ce11ificate of
authentication on the Bond has been duly executed by the manual signature of an authorized
representative of the Registrar. Cer1ificates of authentication on different Bonds need not be signed
by the same representative. The executed ce11ificate of authentication on a Bond is conclusive
evidence that it has been authenticated and delivered under this Resolution. When the Bonds have
. been so prepared, executed and authenticated, the City Finance Director will deliver the same to the
Purchaser upon payment of the purchase plice in accordance with the contract of sale heretofore
made and executed, and the Purchaser is not obligated to see to the application of the purchase
pnce.
2.06. Temporary Bonds. The City may elect to deliver in lieu of printed definitive Bonds
one or more typewlitten tempormy Bonds in substantially the fonn set forth in Section 3 with such
changes as may be necessary to reflect more thml one matmity in a single temporary bond. Upon
the execution and delivelY of definitive Bonds the temporary Bonds will be exchanged therefor and
cancelled.
Section 3. FomlofBond.
3.0l. The Bonds will be printed or typewritten in substantially the following fonn:
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. [F ace of the Bond]
NO.R- UNITED STATES OF AMERlCA $
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STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF HOPKINS
GENERAL OBLIGATION TAX INCREMENT BOND, SERIES 2002A
Rate MatUlity Original Issue CUSIP
December ,2002
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[Registered Owner: Cede & Co.]
The City of Hopkins, Minnesota, a duly organized and existing municipal corporation in
Helmepin County, Minnesota (City), acknowledges itself to be indebted and for value received
hereby promises to pay to the Registered Owner specified above or registered assigns, the principal
. sum of $ on the maturity date specified above, with interest thereon fi-om the date
hereof at the aIillua} rate specified above, payable 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.
The interest hereon and, upon presentation and sun-ender hereof, the plincipaJ hereof are payable in
lawful money of the United States of America by check or draft by Bankers Trust Company, Des
Moines, Iowa as Bond Registrar, Paying Agent, Transfer Agent and Authenticating Agent, or its
designated successor under the Resolution described herein. For the prompt and full payment of
such principal and interest as the same respectively become due, the full faith and credit and taxing
powers of the City have been and are hereby inevocably pledged.
The City may elect on February I, 2013, and on any day thereafter to prepay Bonds due on
or after February 1, 2014. Redemption may be in whole or in part and if in part, at the option of the
City and in sllch maImer as the City will detenl1ine. If less than aU Bonds of a matmity are called
for redemption, the City will notifY Depository Trust Company (DTe) of the patticular amount of
such mahllity to be prepaid. DIe will dete11l1ine by lot the amount of each participant's interest in
such maturity to be redeemed and each pmticipant will then select by lot the beneficial O\vnership
interests in such matLnity to be redeemed. Prepayments will be at a plice of par plus accrued
interest.
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. This Bond is one of an issue in the aggregate plincipal amount of $2,490,000 all of like
original issue date and tenor, except as to number, matmity date, redemption privilege, and interest
rate, all issued pursuant to a resolution adopted by the City Council on November 19, 2002 (the
Resolution), for the purpose of providing money to aid in financing the public redevelopment costs
of a project (Project), pursuant to and in full confonnity with the home rule chmiel' of the City and
the Constitution and laws of the State of Mi1ll1esota, induding Mirmesota Statutes, Sections 469.174
to 469.1799, the Milmesota Tax Increment Financing Act, and MiImesota Statutes, Sections
469.001 through 469.047, and the plincipal hereof and interest hereon are payable primarily from
tax increments resulting from increases in taxable valuation of real property in a tax increment
financing district in the Project, as set f01ih in the Resolution to which reference is made for a full
statement of rights and powers thereby confened. The full faith and credit of the City are
irrevocably pledged for payment of this Bond and the City Council has obligated itself to levy ad
valorem taxes on all taxable propelty in the City in the event of any deficiency in tax increments
pledged, which taxes may be levied without limitation as to rate or amount. The Bonds of this
selies are issued only as fully registered Bonds in denominations of $5,000 or any integral multiple
thereof of single matmities.
As provided in the Resolution and subject to certain limitations set f01ih therein, this Bond is
transferable upon the books of the City at the plincipal office of the Bond Registrar, by the
registered owner hereof in person or by the owner's attomey duly authorized in writing, upon
sun-ender hereof together with a written instrument of transfer satisfactory to the Bond Registrar,
. duly executed by the registered owner or the owner's attorney; and may also be sunendered in
exchange for Bonds of other authOlized denominations. Upon such transfer or exchange the City
will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of
the same aggregate plincipal amount, bearing interest at the same rate and maturing on the same
date, subject to reimbursement for any tax, fee or govemmental charge required to be paid with
respect to such transfer or exchange.
The City and the Bond Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of
receiving payment and for all other purposes, and neither the City nor the Bond Registrar will be
affected by any notice to the contrmy.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the home rule chmiel' of the City and the Constitution and laws of
the State of Milmesota to be done, to exist, to happen and to be perfonned preliminaIY to and in the
issuance of this Bond in order to make it a valid and binding general obligation of the City in
accordance with its terms, have been done, do exist, have happened and have been perf0I111ed as so
required, and that the issuance of this Bond does not cause the indebtedness of the City to exceed
any constitutional, statutory or chmiel' limitation of indebtedness.
This Bond is not valid or obligatory for any purpose or entitled to any secmity or benefit
under the Resolution until the Cellificate of Authentication hereon has been executed by the Bond
. Registrar by manual signature of one of its authOlized representatives.
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. IN WITNESS WHEREOF, the City of Hopkins, Hennepin County, Minnesota, by its City
Council, has caused this Bond to be executed on its behalf by the facsimile or lllanual signatures of
the Mayor and City Manager and has caused this Bond to be dated as of the date set f011h below.
Dated:
CITY OF HOPKINS, MINNESOTA
(Facsimile ) (Facsimile)
City Manager Mayor
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
By
Auth011zed Representative
.
The following abbreviations, when used in the insc11ption on the face of this Bond, will be
construed as though tbey were written out in full according to applicable laws or regulations:
TEN COM -- as tenants UNIT GIFT MIN ACT Custodian
111 common (Cust) (Minor)
TEN ENT -- as tenants under Unifonn Gifts or
by entireties Transfers to Minors
JT TEN -- as joint tenants with
right of survivorship and Act. . . . . . . . . . .
not as tenants in common (State)
Additional abbreviations may also be used though not in the above list.
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. ASSIGNMENT
For value received, the undersigned hereby sells, assIgns arrd transfers unto
the within Bond and all rights thereunder, and
does hereby ilTevocably 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 can-espond with the name
as it appears upon the face of the within Bond in evelY particular, without
alteration or any change whatever.
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the
. SecUlities Transfer Agent Medallion Program ("STAMP"), the Stock Exchange Medallion Program
("SEMP"), the New Y ark Stock Exchange, Inc. Medallion Signatures Program ("MSP") or other
such "signature guarantee program" as may be determined by the Registrar in addition to, or in
substitution for, STAMP, SEMP or MSP, all in accordance with the Secmities Exchange Act of
1934, as amended.
The Bond Regish'ar will not effect transfer of this Bond unless the infol111ation concerning
the assignee requested below is provided.
Name and Address:
(Include infol111ation for all joint owners if this Bond
is held by joint account)
Please inse11 social security or other
identifying number of assignee
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.
. PROVISIONS AS TO REGISTRATION
The ownership of the principal of and interest on the within Bond has been registered on the
books of the Registrar in the name of the person last noted below.
Signature of
Date of Registration Registered Owner Officer of Re2:istrar
Cede & Co.
Federal ill #13-2555119
3.02. The City Clerk is directed to obtain a copy of the proposed approving legal opinion
of Kennedy & Graven, Chattered, Minneapolis, Minnesota, which is to be complete except as to
dating thereof and to cause the opinion to be printed on or accompany each Bond.
Section 4. Payment; SecUlity; Pledges and Covenants.
4.0l. (a) The Bonds are payable from the General Obligation Tax Increment Bonds,
. Series 2002A Debt Service Fund (Debt Service Fund) hereby created, and all tax increments (Tax
Increments) fi'om the TIP Distlict received by the City pursuant to the TIF Agreement are pledged
to the Debt Service Fund. If a payment of principal or interest on the Bonds becomes due when
there is not sufficient money in the Debt Service Fund to pay the same, the City Finance Director is
directed to pay such principal or interest from the general fund of the City, and the general fund will
be reimbursed for those advances out of the proceeds of Tax Increments when received. There is
appropriated to the Debt Service Fund (i) capitalized interest funded from Bond proceeds, if any, (ii)
any amount over the minimum purchase price paid by the Purchaser, and (iii) the accmed interest
paid by the Purchaser upon closing and delivery ofthe Bonds.
(b) Proceeds of the Bonds, less amounts approp11ated to Debt Service Fund under
Section 4.01(a) and amounts used to pay costs of issuance of the Bonds, wm be made available to
pay public redevelopment costs of the Project in accordance with the TIF Agreement.
4.02. It is detennined that the estimated collection of Tax h1crements for payment of
principal and interest on the Bonds pursuant to the TIF Agreement will produce at least five percent
in excess of the amount needed to meet, when due, the principal and interest payments on the Bonds
and that no tax levy is needed at this time.
4.03. The City Clerk is directed to file a ce11ified copy of this Resolution with the
Taxpayer Services Division Manager of Hennepin County and obtain the certificate required by
Minnesota Statutes, Section 475.63.
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. Section 5. Authentication ofTransclipt.
5.0l. The officers of the City are authorized and directed to prepare and fumish to the
Purchaser and to the attorneys approving the Bonds, certified copies of proceedings and records of
the City relating to the Bonds and to the financial condition and affairs of the City, and such other
certificates, affidavits and transclipts as may be required to show the facts within their knowledge or
as shown by the books and records in their custody and under their control, relating to the validity
and marketability of the Bonds, and such instruments, including any heretofore furnished, will be
deemed representations ofthe City as to the facts stated therein.
5.02. The Mayor, City Manager and City Finance Director are authorized and directed to
certify that they have examined the Official Statement prepared and circulated in cOlmection with
the issuance and sale of the Bonds and that to the best of their knowledge and belief the Official
Statement is a complete and accurate representation of the facts and representations made therein as
of the date of the Official Statement.
5.03. TIle City authorizes the Purchaser to fOlward the amount of Bond proceeds allocable
to the payment of issuance expenses (other than amounts payable to Kelmedy & Graven, Chartered
as Bond Counsel) to U.S. Trust Company, Minneapolis, Minnesota on the closing date for further
distlibution as directed by the City's financial adviser, Ehlers & Associates, Inc.
. Section 6. Tax Covenant.
6.01. The City covenants and agrees with the holders from time to time of the Bonds that
it will not take or pennit to be taken by any of its officers, employees or agents any action which
would cause the interest on the Bonds to become subject to taxation under the Intemal Revenue
Code of 1986, as amended (the Code), and the Treasury Regulations promulgated thereunder, in
effect at tbe time of such actions, and that it will take or cause its officers, employees or agents to
take, all affinnative action within its power that may be necessary to ensure that such interest will
not become subject to taxation under the Code and applicable Treasury Regulations, as presently
existing or as hereafter amended and made applicable to the Bonds.
6.02. The City will comply with requirements necessary under the Code to establish and
maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the
Code, including without limitation requirements relating to temporary periods for investments,
limitations on amounts invested at a yield greater than the yield on the Bonds and the rebate of
excess investment earnings to the United States.
6.03. The City further covenants not to use the proceeds of the Bonds or to cause or permit
them or any of them to be used, in such a maImer as to cause the Bonds to be "private activity
bonds" within the meaning of Sections 103 and 141 through 150 of the Code.
6.04. The City will use its best effOlts to comply with any federal procedural requirements
. which may apply in order to effechmte the designations made by this section.
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. Section 7. Book-Entry System; Limited Obligation of City.
7.01. The Bonds will be initially issued in the f01111 of a separate single typewritten or
printed fully registered Bond for each of the matuzities set f011h in Section 1.04 hereof. Upon initial
issuance, the ownership of each Bond will be registered in the registration books kept by the Bond
Registrar in the name of Cede & Co., as nominee for The Depository Tmst Company, New Yark,
New York, and its successors and assigns (DTe). Except as provided in this section, all of the
outstanding Bonds will be registered in the regish-ation books kept by the Bond Registrar in the
name of Cede & Co., as nominee ofDTC.
7.02. With respect to Bonds registered in the registration books kept by the Bond Registrar
in the name of Cede & Co., as nominee ofDIC, the City, the Bond Registrar and the Paying Agent
will have no responsibility or obligation to any broker dealers, banks and other financial institutions
from time to time for which DTe holds Bonds as securities depositary (Pmiicipants) or to any other
person on behalf of which a Participant holds an interest in the Bonds, including but not limited to
any responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co.
or any Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any
Pmticipant or any other person (otber than a registered owner of Bonds, as shown by the registration
books kept by the Bond Registrar,) of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the payment to any Participant or any other person, other than a registered owner
of Bonds, of any amount with respect to principal of, premium, if any, or interest on the Bonds. The
. City, the Bond Registrar and the Paying Agent may treat and consider the person in whose name
each Bond is registered in the registration books kept by the Bond Registrar as the holder and
absolute owner of such Bond for the purpose of payment of plincipal, premium and interest with
respect to such Bond, for the purpose of registeling transfers with respect to such Bonds, and for all
other purposes. The Paying Agent will pay all principal of. premium, if any, and interest on the
Bonds only to or on the order of the respective registered owners, as shown in the registration books
kept by the Bond Registrar, and all such payments will be valid and effectual to fully satisfy and
discharge the City's obligations with respect to payment of pJincipal of, premium, if any, or interest
on the Bonds to the extent of the sum or sums so paid. No person other than a registered owner of
Bonds, as shown in the registration books kept by the Bond Registrar, will receive a certificated
Bond evidencing the obligation of this resolution. Upon delivery by DTe to the City Manager of a
written notice to the effect that DTC has detelmined to substitute a ne,,,, nominee in place of Cede &
Co., tbe words "Cede & Co.," will refer to such new nominee of DTC; and upon receipt of such a
notice, the City Manager will promptly deliver a copy ofthe same to the Bond Registrar and Paying
Agent.
7.03. Representation Letter. The City has heretofore executed and delivered to DTe a
Blanket Issuer Letter of Representations (Representation Letter) which shall govern payment of
plincipal of, premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any
Paying Agent or Bond Registrar subsequently appointed by the City with respect to the Bonds will
agree to take all action necessary for all representations of the City in the Representation letter with
respect to the Bond Regish"ar and Paying Agent, respectively, to be complied with at all times.
. 7.04. Transfers Outside Book-Entry System. In the event the City, by resolution of the City
Council, detennines that it is in the best interests of the persons having beneficial interests in the
Bonds that they be able to obtain Bond ce11ificates, the City will notify DTC, whereupon DIC will
12
. notify the Pat1icipants, of the availability through DIC of Bond certificates. In such event the City
will issue, transfer and exchange Bond certificates as requested by DIC and any other registered
owners in accordance with the provisions of this Resolution. DTC may detennine to discontinue
providing its services with respect to the Bonds at any time by giving notice to the City and
discharging its responsibilities with respect thereto under applicable law. In such event, if no
successor secUlities depositOlY is appointed, the City will issue and the Bond Registrar will
authenticate Bond celtificates in accordance with this resolution and the provisions hereof will
apply to the transfer, exchange and method of payment thereof.
7.05. Payments to Cede & Co. Notwithstanding any other provision of this Resolution to
the contrmy, so long as a Bond is registered in the name of Cede & Co., as nominee of Ole
payments with respect to principal of, premium, if any, and interest on the Bond and notices with
respect to the Bond will be made and given, respectively in the marmer provided in DTC's
Operational Anangements, as set f01th in the Representation Letter.
Section 8. Continuing Disclosure.
8.01. The City hereby covenants and agrees that it will comply with and carry out all of the
provisions of the Continuing Disclosure Certificate. Nonvithstanding any other provision of this
Resolution, failure of the City to comply with the Continuing Disclosure CeJ1ificate is not to be
considered an event of default with respect to the Bonds; however, any Bondholder may take such
actions as may be necessary and appropIiate, including seeking mandate or specific perfonnance by
. court order, to cause the City to comply with its obligations under this section.
8.02. "Continuing Disclosure Celiificate" means that certain Continuing Disclosure
Celtificate executed by the Mayor and City Manager and dated the date of issuance and delivelY of I
the Bonds, as originally executed and as it may be amended from time to time in accordance with
the ten11S thereof.
Passed and adopted this 19th day of November, 2002.
CITY OF HOPKINS, MrNNESOT A
By
Mayor
ATTEST:
City Clerk
.
13
. CITY OF HOPKINS, MINNESOTA
RESOLUTION NO. 2002-107
A RESOLUTION AWARDING THE SALE OF $960,000
PERMANENT IMPROVEMENT REVOLVING FUND BONDS, SERIES 2002B;
FIXING THEIR FORM AND SPECIFICA nONS;
DIRECTING THEIR EXECUTION AND DELIVERY;
AND PROVIDING FOR THEIR PAYMENT
BE IT RESOLVED By the City Council of the City of Hopkins, Hennepin County,
Minnesota (City) as follows:
Section 1. Sale of Bonds.
1.01. The proposal of (Purchaser) to
purchase $960,000 General Obligation Pel1l1anent Improvement Revolving Fund Bonds, SeIies
2002B (Bonds) of the City described in the Official Tenns and Conditions ofIssue thereofis hereby
found and detel1nined to be a reasonable offer and is hereby accepted, the proposal being to
purchase the Bonds at a Plice of $ plus accrued interest to date of delivery, for Bonds
bearing interest as follows:
. Year of Interest Year of Interest
Matmity Rate Maturity Rate
2004 2009
2005 2010
2006 2011
2007 2012
2008 2013
Tllle interest cost:
1.02. The sum of $ being the amount proposed by the Purchaser in excess of
$948,000 will be credited to the Debt Service Fund hereinafter created. The City Finance Director
is directed to retain the good faith check of the Purchaser, pending completion of the sale of the
Bonds, and to retum the good faith checks of the unsuccessful proposers f0l1hwith. The Mayor and
City Manager are directed to execute a contract with the Purchaser on behalf ofthe City.
1.03. The City will f0l1hwith issue and sell the Bonds in the total principal amount of
$960,000, originally dated as of the date of delivery in the denomination of $5,000 each or any
integral multiple thereof, numbered No. R-l, upward, bearing interest as above set fOlth, and which
mature seIially on Febmary 1 in the years and amounts as follows:
.
. Year Amount Year Amount
2004 $75,000 2009 $100,000
2005 85,000 2010 105,000
2006 85,000 2011 110,000
2007 90,000 2012 115,000
2008 95,000 2013 100,000
1.04. Optional Redemption. The City may elect on F ebmary 1, 20 I 0 and on any day
thereafter to prepay Bonds due on or after FebJUaIY 1, 2011. Redemption may be in whole or in
pmi and if in part, at the option of the City and in such manner as the City will detennine. If less
than all Bonds of a maturity are called for redemption, the City will notify DTC (as defIned in
Section 7 hereof) of the particular amount of such maturity to be prepaid. DTC will detennine by
lot the amount of each pmiicipant's interest in such maturity to be redeemed and each paliicipant
will then select by lot the beneficial ownership interests in such maturity to be redeemed.
Prepayments will be at a price of par plus accrued interest.
Section 2. Registration and Payment.
2.01. Registered Fom1. The Bonds shall be issued only in fully registered fonn. The
interest thereon and, upon sunender of each Bond, the principal amount thereof, is payable by check
or draft issued by the Registrar desclibed herein.
. 2.02. Dates; Interest Payment Dates. Each Bond will be dated as of the last interest
payment date preceding the date of authentication to which interest on the Bond has been paid or
made available for payment, unless (i) the date of authentication is an interest payment date to
which interest has been paid or made available for payment, in which case such Bond shall be dated
as of the date of authentication, or (ii) the date of authentication is plioI' to the first interest payment
date, in which case such Bond will be dated as of the date of original issue. The interest on the
Bonds is payable on February 1 and August 1 of each year, commencing August L 2003, to the
owner of record thereof as of the close of business on the fifteenth day of the inm1ediately preceding
month, whether or not such day is a business day.
2.03. Registration. The City will appoint, and shall maintain, a bond registrar, transfer
agent, authenticating agent and paying agent (Registrar). The effect of registration and the rights
and duties of the City and the Registrar with respect thereto are as follows:
(a) Register. The Registrar must keep at its plincipal corporate tlUst office a
bond register in which the Registrar provides for the registration of ownership of Bonds and
the registration of transfers and exchanges of Bonds entitled to be registered, transfened or
exchanged.
(b) Transfer of Bonds. Upon sUlTender for transfer of a Bond duly endorsed by
the registered owner thereof or accompanied by a written instrument of transfer, in fonn
. satisfactory to the Registrar, duly executed by the registered owner thereof or by an attomey
duly authorized by the registered owner in wliting, the Registrar will authenticate and
deliver, in the name of the designated transferee or transferees, one or more new Bonds of a
like aggregate principal amount and matUlity, as requested by the transferor. The Registrar
2
. 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. When Bonds are sUlTendered by the registered owner
for exchange the Registrar will authenticate and deliver one or more new Bonds of a like
aggregate principal amount and matmity, as requested by the registered owner or the
owner's attomey in writing.
(d) Cancellation. Bonds sUlTendered upon any transfer or exchange will be
promptly cancelled by the Registrar and thereafter disposed of as directed by the City.
(e) Improper or UnauthOlized Transfer. When a Bond is presented to the
Registrar for transfer, the Registrar may refuse to transfer the Bond until the Registrar is
satisfied that the endorsement on the Bond or separate instrument of transfer is valid and
genuine and that the requested transfer is legally authOlized. The Registrar will incur no
liability for the refusal, in good faith, to make transfers which it, in its judgment, deems
improper or unauthorized.
(f) Persons Deemed Owners. The City and the Regish'ar may treat the person in
whose name a Bond is registered in the bond register as the absolute owner of the Bond,
whether the Bond is overdue or not, for the purpose of receiving payment of, or on account
of, the principal of and interest on the Bond and for all other purposes and payments so
. made to registered owner or upon the owner's order will 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 a transfer or exchange of Bonds, the Registrar
may impose a charge upon the owner thereof sufficient to reimburse the Regish-ar for any
tax, fee or other governmental charge required to be paid with respect to the transfer or
exchange.
(h) Mutilated, Lost, Stolen or Desh'oyed Bonds. If a Bond becomes mutilated or
is destroyed, stolen or lost, the Registrar will deliver a new Bond of Wee amount, number,
matmity date and tenor in exchange and substitution for and upon cancellation of the
mutilated Bond or in lieu of and in substitution for a Bond destroyed, stolen or lost, upon the
payment of the reasonable expenses and charges of the Registrar in cOIUlection 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 appropliate bond or indemnity in fonn,
substance and amount satisfactory to it and as provided by law, in which both the City and
the Registrar must be named as obligees. Bonds so sunendered to the Registrar will be
ca11celIed by the Registrar and evidence of such cancellation must be given to the City. If
the mutilated, destroyed, stolen or lost Bond has already matured or been called for
redemption in accordance with its temlS it is not necessary to issue a new Bond plioI' to
payment.
. (i) Redemption. In the event any of the Bonds are called for redemption, notice
thereof identifying the Bonds to be redeemed will be given by the Registrar by mailing a
copy ofthe redemption notice by first class mail (postage prepaid) not more than 60 and not
3
. less than 30 days plior to the date fixed for redemption to the registered owner of each Bond
to be redeemed at the address shown on the registration books kept by the Regish-ar and by
publishing the notice in the manner required by law. Failure to give notice by publication or
by mail to any registered owner, or any defect therein, will not affect the validity of any
proceeding for the redemption of Bonds. Bonds so called for redemption will cease to bear
interest after the specified redemption date, provided that the funds for the redemption are
on deposit with the place of payment at that time.
2.04. Appointment of Initial Registrar. The City appoints Bankers TlUst Company, Des
Moines. Iowa, as the initial Registrar. The Mayor and the City Manager are authOlized to execute
and deliver, on behalf of the City, a contract with the Registrar. Upon merger or consolidation of
the Registrar with another corporation, if the resulting corporation is a bank or nust company
authorized by law to conduct such business, such corporation is authOlized to act as successor
Regisn'ar. The City agrees to pay the reasonable and customary charges of the Registrar for the
services perfonned. The City reserves the right to remove the Registrar upon 30 days' notice and
upon the appointment of a successor Registrar, in which event the predecessor Registrar must
deliver all cash and Bonds in its possession to the successor Registrar and must deliver the bond
register to the successor Registrar. On or before each principal or interest due date, without further
order of this Council, the City Finance Director must transmit to the Regish-ar moneys sufficient for
the payment of all ptincipal and interest then due.
2.05. Execution. Authentication and Delivery. The Bonds will be prepared under the
. direction of the City Manager and executed on bebalfofthe City by the signatures ofthe Mayor and
the City Manager, provided that all signatures may be printed, engraved or lithographed facsimiles
of the Oliginals. In case any officer whose si!:,l11ature or a facsimile of whose signature appears on
the Bonds ceases to be such officer before the delivery of any Bond, such signature or facsimile will
nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in office
until deIivelY. Notwithstanding such execution, a Bond will not be valid or obligatory for any
purpose or entitled to any secmity 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 authOlized
representative of the Registrar. Certificates of authentication on different Bonds need not be signed
by the same representative. The executed celtificate of authentication on each Bond is conclusive
evidence that it has been authenticated and delivered under this Resolution. When the Bonds have
been so prepared, executed and authenticated, the City Finance Director shall deliver the same to the
Purchaser upon payment of the purchase price in accordance with the contract of sale heretofore
made and executed, and the Purchaser is not obligated to see to the application of the purchase
pnce.
2.06. Temporary Bonds. The City may elect to deliver in lieu ofplinted definitive Bonds
one or more typewritten temporary Bonds in substantially the [onn set fmib in Section 3 with such
changes as may be necessary to reflect more than one maturity in a single temponu)' bond. Upon
the execution and delivel)' of definitive Bonds the temporary Bonds will be exchanged therefor and
cancelled.
.
4
. Section 3. Fom10fBond.
3.01. The Bonds will be printed in substantially the following fonn:
[Face of the Bond]
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF HOPKlNS
GENERAL OBLIGA nON PERMANENT IMPROVEMENT
REVOLVING FUND BOND, SERIES 2002B
Date of
Rate Maturity Original Issue CUSIP
December 2002
-
No.
$
. Registered Owner: Cede & Co.
The City of Hopkins, MiImesota, a duly organized and existing municipal corporation in
Hennepin County, Minnesota (City), acknowledges itself to be indebted and for value received
hereby promises to pay to the Registered Owner specified above or registered assigns, the plincipal
sum of$ on the maturity date specified above with interest thereon from the date hereof
at the annual rate specified above, payable February 1 and August 1 in each year, commencing
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. The interest
hereon and, upon presentation and sun-ender hereof, the principal hereof are payable in lawful
money of the United States of Amelica by check or draft by Bankers Trust Company, Des Moines,
Iowa, as Bond Registrar, Paying Agent, Transfer Agent and Authenticating Agent, or its designated
successor under the Resolution described herein. For the prompt and full payment of such principal
and interest as the same respectively become due, the full faith and credit and taxing powers of the
City have been and are hereby ilTevocably pledged.
The City may elect on February 1,2010, and on any day thereafter to prepay Bonds due on
or after Febmary 1,2011. Redemption may be in whole or in pal1 and if in pm1, at the option of the
City and in such manner as the City will detennine. If less than all Bonds of a maturity are called
for redemption, the City will notify Depository Tmst Company (DTe) of the pm1icular amount of
such matUlity to be prepaid. DTe will detennille by lot the amount of each paliicipant's interest in
such maturity to be redeemed and each pmiicipant will then select by lot the beneficial ownership
. interests in such maturity to be redeemed. Prepayments will be at a price of par plus accmed
interest.
5
. This Bond is one of an issue in the aggregate principal amount of $960,000 all of like
original issue date and tenor, except as to number, matmity date, redemption privilege, and interest
rate, all issued pursuant to a resolution adopted by the City Council on November 19, 2002 (the
Resolution), for the purpose of providing money for the Pennanent Improvement Revolving Fund
of the City as authOlized by Section 7.14, Subd. 2 of the City's home rule charter, to finance celiain
assessable local improvements, pursuant to and in full confomlity with the Constitution and laws of
the State of Minnesota, and the City's home rule chmier, and the principal hereof and interest hereon
are payable primarily from special assessments against propeliy specially benefited by local
improvements and ad valorem taxes, as set f0l1h in the Resolution to which reference is made for a
full statement of rights and powers thereby confen-ed. The full faith and credit of the City are
irrevocably pledged for payment of this Bond and the City Council has obligated itself to levy
additional ad valorem taxes on all taxable propelty in the City in the event of any deficiency in
special assessments pledged, which taxes may be levied without limitation as to rate or amount.
The Bonds of this series are issued only as fully registered Bonds in denominations of $5,000 or any
integral multiple thereof of single maturities.
As provided in the Resolution and subject to certain limitations set forth therein, this Bond is
transferable upon the books of the City at the pIincipal office of the Bond Registrar, by the
registered owner hereof in person or by the owner's attomey duly authoIized in writing upon
sun-ender hereof together with a wlitten instrument of transfer satisfactory to the Bond Registrar,
duly executed by the registered owner or the owner's attomey; and may also be sUlTendered in
exchange for Bonds of other authorized denominations. Upon such transfer or exchange the City
. will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of
the same aggregate Plincipal amount, bearing interest at the same rate and manning on the same
date, subject to reimbursement for any tax, fee or govenunental charge required to be paid with
respect to such transfer or exchange.
The City and the Bond Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of
receiving payment and for all other purposes, and neither the City nor the Bond Registrar will be
affected by any notice to the contrary.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the Constitution and laws of the State of Minnesota, and the City's
home rule chalter to be done, to exist, to happen and to be pelf0l111ed preliminary to and in the
issuance of this Bond in order to make it a valid and binding general obligation of the City in
accordance with its terms, have been done, do exist, have happened and have been perf0l111ed as so
required, and that the issuance of this Bond does not cause the indebtedness of the City to exceed
any constitutional, statutory or chmter limitation of indebtedness.
This Bond is not valid or obligatory for any purpose or entitled to any security or benefit under the
Resolution until the Celtificate of Authentication hereon has been executed by the Bond Registrar
by manual signature of one of its auth0l1zed representatives.
.
6
. IN WITNESS WHEREOF, the City of Hopkins, Hem1epin County, Minnesota, by its City
Council, has caused this Bond to be executed on its behalf by the facsimile or manual signatures of
the Mayor and City Manager and has caused this Bond to be dated as of the date set forth below.
Dated:
CITY OF HOPKINS, MINNESOTA
(Facsimile ) (Facsimile)
City Manager Mayor
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
BANKERS TRUST COMPANY
By
. AuthOlized Representative
The following abbreviations, when used in the inscription on the face of this Bond, shall be
construed as though they were Wlitten out in full according to applicable laws or regulations:
TEN COM -- as tenants UNIF GIFT MIN ACT Custodian
m common ( Cust) (Minor)
TEN ENT -- as tenants under Unifonn Gifts or
by entireties Transfers to Minors
JT TEN -- as joint tenants with
right of survivorship and Act. . . . . . . . . . .
not as tenants in common (State)
Additional abbreviations may also be used though not in the above list.
.
7
. ASSIGNMENT
For value received, the undersigned hereby sells, assIgns and transfers unto
the within Bond and all lights thereunder, and
does hereby ilTevocably constitute and appoint attomey 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 cOlTespond with the name
as it appears upon the face of the within Bond in every pmticular, without
alteration or any change whatever.
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the
Securities Transfer Agent Medallion Program ("STAMP"), the Stock Exchange Medallion Program
("SEMP"), the New York Stock Exchange, Inc. Medallion Signatures Program ("MSP") or other
such "signature guarantee program" as may be detennined by the Registrar in addition to, or in
. substitution for, STAMP, SEMP or MSP, all in accordance with the Securities Exchange Act of
1934, as amended.
The Bond Registrar will not effect transfer of this Bond unless the inf01111ation conceming
the assignee requested below is provided.
Name and Address:
(Include i11fo1111ation for all joint owners ifthi5 Bond
is heLd by joint account.)
Please inse11 social security or other
identifying number of assignee
.
8
. PROVISIONS AS TO REGISTRATION
TIle ownership of the principal of and interest on the within Bond has been registered on the
books of the Registrar in the name of the person last noted below.
Signarure of
Date of Registration Registered Owner Officer of Registrar
Cede & Co.
Federal ill #13-2555119
3.02. The City Clerk is directed to obtain a copy of the proposed approving legal opinion
of Kennedy & Graven, Chattered, Minneapolis, Minnesota, which is to be complete except as to
dating thereof and to cause the opinion to be printed on or accompany each Bond.
Section 4. Payment: Secmity: Pledges and Covenants.
4.01. The Bonds are payable from the General Obligation Permanent Improvement
Revolving Fund Bonds, Series 2002B Debt Service Fund (Debt Service Fund) hereby created
within the Pennanent Improvement Revolving Fund. The proceeds of general taxes hereinafter
levied (Taxes), and special assessments (Assessments) levied or to be levied for the improvements
. (Improvements) financed by the Bonds are hereby pledged to the Debt Service Fund. If any
payment of plincipal or interest on the Bonds shall become due when there is not sufficient money
in the Debt Service Fund to pay the same, the Finance Director is directed to pay such principal or
interest from the general fund of the City, and the general fund will be reimbursed for such
advances out of the proceeds of Assessments and Taxes when collected. There is appropliated to
the Debt Service Fund all capitalized interest financed from Bond proceeds, if any, any amount over
the minimum purchase Plice paid by the Purchaser and the accrued interest paid by the Purchaser
upon closing and delivelY of the Bonds.
4.02. For the purpose of paying the plincipal and interest on the Bonds, there is levied a
direct annual irrepealable ad valorem tax (Taxes) upon all of the taxable property in the City, which
shall be spread upon the tax rolls and collected with and as part of other general taxes of the City.
The Taxes will be credited to the Debt Service Fund above provided and will be in the years and
amounts as follows (year stated being year of levy for collection in the following year):
(See Attachment A)
4.03. It is hereby detennined that the estimated collections of Assessments and the
foregoing Taxes will produce at least five percent in excess of the amount needed to meet \vhen due
the plincipal and interest payments on the bonds. The tax levy herein provided is irrepealable until
all of the bonds are paid, provided that the City Clerk annually, at the time the City makes its tax
levies, may certify to the Director of Property Taxation of Hennepin County the amount available in
. the Debt Service Fund to pay plincipal and interest due during the ensuing year, and the Director of
Property Taxation will thereupon reduce the levy collectible dming such year by the amount so
certified.
9
. 4.04. The City Clerk is authorized and directed to file a celiified copy of this resolution with
the Director of Propeliy Taxation of Helmepin County and to obtain the celiificate required by
Mim1esota Statutes, Section 475.63.
Section 5. Authentication of Transcript.
5.01. The officers of the City are authOlized and directed to prepare and fumish to the
Purchaser and to the attomeys approving the Bonds, celiified copies of proceedings and records of
the City relating to the Bonds and to the financial condition and affairs of the City, and such other
celiificates, affidavits and transcripts as may be required to show the facts within their knowledge or
as shown by the books and records in their custody and under their control, relating to the validity
and marketability of the Bonds and such inshuments, including any heretofore fumished, may be
deemed representations of the City as to the facts stated therein.
5.02. The Mayor, City Manager, and Finance Director are authorized and directed to
certify that they have examined the Official Statement prepared and circulated in connection with
the issuance and sale of the Bonds and that to the best of their knowledge and belief the Official
Statement is a complete and accurate representation of the facts and representations made therein as
of the date of the Official Statement.
5.03 The City authOlizes the Purchaser to fOlward the amount of Bond proceeds allocable
to the payment of issuance expenses (other than amounts payable to Kelmedy & Graven, Chmiered
. as Bond Counsel) to U.S. Trust Company, Minneapolis, Minnesota on the closing date for fi.lliher
distribution as directed by the City's financial adviser, Ehlers & Associates, Inc.
Section 6. Tax Covenant.
6.0l. The City covenants and agrees with the holders from time to time of the Bonds that
it will not take or permit to be taken by any of its officers, employees or agents any action which
\vould cause the interest on the Bonds to become subject to taxation under the Intemal Revenue
Code of 1986, as amended (the Code), and the Treasury Regulations promulgated thereunder, in
effect at the time of such actions, and that it will take or cause its officers, employees or agents to
take, all affinnative action within its power that may be necessary to ensure that such interest will
not become subject to taxation under the Code and applicable Treasury Regulations, as presently
existing or as hereafter amended and made applicable to the Bonds.
6.02. The City will comply with requirements necessary under the Code to establish and
maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the
Code, including without limitation requirements relating to temporary periods for investments,
limitations on amounts invested at a yield greater than the yield on the Bonds.
6.03. The City fmiher covenants not to use the proceeds of the Bonds or to cause or per111it
them or any of them to be used, in such a manner as to cause the Bonds to be "private activity
bonds" within the meaning of Sections 103 and 141 through 150 of the Code.
. 6.04. The City will use its best effOlis to comply with any federal procedural requirements
which may apply in order to effectuate the designations made by this section.
10
. Section 7. Book-Entry System; Limited Obligation ofCitv.
7.01. The Bonds will be initially issued in the fonn of a separate single typewlitten or
ptinted fully registered Bond for each of the matUlities set f011h in Section 1.04 hereof. Upon initial
issuance, the ownership of each Bond will be registered in the registration books kept by the Bond
Registrar in the name of Cede & Co., as nominee for The Depository Trust Company, New York,
New York, and its successors and assigns (DTC). Except as provided in this section, all of the
outstanding Bonds will be registered in the registration books kept by the Bond Registrar in the
name of Cede & Co., as nominee of DIe.
7.02. With respect to Bonds registered in the registration books kept by the Bond Registrar
in the name of Cede & Co., as nominee of DTC, the City, the Bond Registrar and the Paying Agent
will have no responsibility or obligation to any broker dealers, banks and other financial institutions
fro111 time to time for which DIC holds Bonds as secmities depository (Pmticipants) or to any other
person on behalf of which a Participant holds an interest in the Bonds, including but not limited to
any responsibility or obJiga60n with respect to (i) the accuracy of the records ofDIC, Cede & Co.
or any Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any
Participant or any other person (other than a registered owner of Bonds, as shown by the registration
books kept by the Bond Registrar,) of any notice with respect to the Bonds, including any notice of
redemption, or (iii) the payment to any Pat1icipant or any other person, other than a registered owner
of Bonds, of any amount with respect to Plincipal of, premium, if any, or interest on the Bonds. The
. City, the Bond Registrar and tbe Paying Agent may treat and consider the person in whose name
each Bond is registered in the registration books kept by the Bond Registrar as the holder and
absolute owner of sucb Bond for the purpose of payment of plincipal, premium and interest with
respect to such Bond, for the purpose of registeJing transfers with respect to such Bonds, and for all
other purposes. The Paying Agent will pay all principal of, premium, if any, and interest on the
Bonds only to or on the order of the respective registered owners, as shown in the registration books
kept by the Bond Registrar, and all such payments will be valid and effectual to fully satisfy and
discharge the City's obligations with respect to payment of plincipal of, premium, if any, or interest
011 the Bonds to the extent of the sum or sums so paid. No person other than a registered owner of
Bonds, as shown in the registration books kept by the Bond Registrar, will receive a ce11ificated
Bond evidencing the obligation of this resolution. Upon delivery by DIC to the City Manager of a
written notice to the effect that DTC has determined to substitute a new nominee in place of Cede &
Co., the words "Cede & Co.," will refer to such new nominee of DTe; and upon receipt of such a
notice, the City Manager will promptly deliver a copy of the same to the Bond Registrar and Paying
Agent.
7.03. Representation Letter. The City has heretofore executed and delivered to DIe a
Blanket Issuer Letter of Representations (Representation Letter) which shall govem payment of
principal of, premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any
Paying Agent or Bond Registrar subsequently appointed by the City with respect to the Bonds will
agree to take all action necessary for all representations of the City in the Representation letter with
respect to the Bond Registrar and Paying Agent, respectively, to be complied with at all times.
. 7.04. Transfers Outside Book-Entry System. In the event the City, by resolution of the City
Council, detemlines that it is in the best interests of the persons having beneficial interests in the
Bonds that they be able to obtain Bond celtificates, the City will notify DIe, 'A'hereupon DIe will
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. notifY the Participants, of the availability through DIC of Bond certificates. In such event the City
will issue, transfer and exchange Bond celtificates as requested by DTC and any other registered
owners in accordance with tbe provisions of this Resolution. DTe may detem1ine to discontinue
providing its services with respect to the Bonds at any time by giving notice to the City and
discharging its responsibilities with respect thereto under applicable law. In such event, if no
successor securities depositOlY is appointed, the City will issue and the Bond Registrar will
authenticate Bond certificates in accordance with this resolution and the provisions hereof will
apply to the transfer, exchange and method of payment thereof.
7.05. Payments to Cede & Co. Notwithstanding any other provision oftms Resolution to
the conh-my, so long as a Bond is registered in the name of Cede & Co., as nominee of OTC,
payments with respect to plincipal of, premium, if any, and interest on the Bond and notices with
respect to the Bond will be made and given, respectively in the manner provided in DTC's
Operational AlTangel11ents, as set fOlth in the Representation Letter.
Section 8. Continuing Disclosure.
8.01. The City hereby covenants and agrees that it will comply with and cany out all of the
provisions of the Continuing Disclosure Celtificate. N otwitbstanding any otber provision of this
Resolution, failure of the City to comply with the Continuing Disclosure Certificate is not to be
considered an event of default with respect to the Bonds; however, any Bondholder may take such
actions as may be necessmy and appropriate, including seeking mandate or specific peIfonnance by
. cOUli order, to cause the City to comply with its obligations under this section.
8.02. "Continuing Disclosure Celtificate" means that celtain Continuing Disclosure
CeItificate executed by the Mayor and City Manager and dated the date of issuance and delivery of
the Bonds, as Oliginally executed and as it may be amended from time to t1me in accordance with
the tenns thereof
Passed and adopted this 19th day of November, 2002.
CITY OF HOPKINS, MINNESOTA
By
Mayor
ATTEST:
City Clerk
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