2003-048
CITY OF HOPKINS
HENNEPIN COUNTY, MINNESOTA
RESOLUTION NO. 03-048
A RESOLUTION AWARDING THE SALE OF $1,265,000 GENERAL
OBLIGATION STORM SEWER REVENUE BONDS,
SERIES 2003A; FIXING THEIR FORM AND SPECIFICATIONS;
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. It is hereby determined that:
(a) the City engineer has recommended the construction of varIOUS
improvements to the City's storm sewer system (Project).
(b) the City is authorized by Minnesota Statutes, Section 444.075 (Act) to
finance all or a portion of the cost of the Project (Project Costs) by the issuance of
general obligation bonds of the City payable from the net revenues of the storm sewer
system. The Project Costs are presently estimated by the engineer to be as follows:
Proiect Designation & Description:
Total Proiect Cost
Project Costs
Discount Allowance
Finance Related Expenses
$1,221,188
15,812
28,000
Total Issue
$1,265,000
(c) it is necessary and expedient to the sound financial management of the
affairs of the City to issue $1,265,000 General Obligation Storm Sewer Revenue Bonds,
Series 2003A (Bonds) pursuant to the Act to provide financing for the Project.
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1.02. The proposal of (Purchaser) to purchase
$1,265,000 General Obligation Storm Sewer Revenue Bonds, Series 2003A (Bonds) of the City
described in the Terms of Proposal thereof is found and determined to be a reasonable offer and
is 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 Maturity
Interest Rate
Year of Maturity
Interest Rate
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
True interest cost:
1.03. The sum of $ being the amount proposed by the Purchaser in excess
of $1,249,188 will be credited to the Debt Service Fund hereinafter created. The City Finance
Director is directed to retain the good faith check of the Purchaser, pending completion of the
sale of the Bonds, and to return the good faith checks of the unsuccessful proposers forthwith.
The Mayor and City Manager are directed to execute a contract with the Purchaser on behalf of
the City.
1.04. The City will forthwith issue and sell the Bonds pursuant to Minnesota Statutes,
Section 444.075 (Act), in the total principal amount of$ ,originally dated June
1,2003, in the denomination of$5,000 each or any integral multiple thereof, numbered No. R-l,
upward, bearing interest as above set forth, and maturing serially on February I in the years and
amounts as follows:
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Year Amount Year Amount
2004 2014
2005 2015
2006 2016
2007 2017
2008 2018
2009 2019
2010 2020
2011 2021
2012 2022
2013 2023
1.05. Optional Redemption. The City may elect on February I, 2011, and on any day
thereafter to prepay Bonds due on or after February I, 2012. Redemption may be in whole or in
part and if in part, at the option of the City and in such manner as the City will determine. If less
than all Bonds of a maturity are called for redemption, the City will notify DTC (as defined in
Section 7 hereof) of the particular amount of such maturity to be prepaid. DTC will determine
by lot the amount of each participant's interest in such maturity to be redeemed and each
participant will then select by lot the beneficial ownership interests in such maturity to be
redeemed. Prepayments will be at a price of par plus accrued interest.
Section 2. Registration and Payment.
2.01. Registered Form. The Bonds will be issued only in fully registered form. The
interest thereon and, upon surrender of each Bond, the principal amount thereof, is payable by
check or draft issued by the Registrar described herein.
2.02. Dates; Interest Payment Dates. Each Bond will be dated as of the last interest
payment date preceding the date of authentication to which interest on the Bond has been paid or
made available for payment, unless (i) the date of authentication is an interest payment date to
which interest has been paid or made available for payment, in which case such Bond will be
dated as of the date of authentication, or (ii) the date of authentication is prior to the first interest
payment date, in which case such Bond will be dated as of the date of original issue. The interest
on the Bonds will be payable on February I and August I of each year, commencing February I,
2004, to the owner of record thereof as of the close of business on the fifteenth day of the
immediately preceding month, whether or not such day is a business day.
2.03. Registration. The City will appoint, and will 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:
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(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,
transferred or exchanged.
(b) Transfer of Bonds. Upon surrender for transfer of a Bond duly
endorsed by the registered owner thereof or accompanied by a written instrument of
transfer, in form satisfactory to the Registrar, duly executed by the registered owner
thereof or by an attorney duly authorized by the registered owner in writing, the Registrar
will authenticate and deliver, in the name of the designated transferee or transferees, one
or more new Bonds of a like aggregate principal amount and maturity, as requested by
the transferor. The Registrar may, however, close the books for registration of any
transfer after the fifteenth day of the month preceding each interest payment date and
until that interest payment date.
(c) Exchange of Bonds. When Bonds are surrendered by the
registered owner for exchange the Registrar will authenticate and deliver one or more
new Bonds of a like aggregate principal. amount and maturity as requested by the
registered owner or the owner's attorney in writing.
(d) Cancellation. Bonds surrendered upon transfer or exchange will be
promptly cancelled by the Registrar and thereafter disposed of as directed by the City.
( e) Improper or Unauthorized Transfer. When a Bond is presented to
the Registrar for transfer, the Registrar may refuse to transfer the Bond until the Registrar
is satisfied that the endorsement on the Bond or separate instrument of transfer is valid
and genuine and that the requested transfer is legally authorized. The Registrar will incur
no liability for the refusal, in good faith, to make transfers which it, in its judgment,
deems improper or unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the
person in whose name a Bond is registered in the bond register as the absolute owner of
the Bond, whether the Bond is overdue or not, for the purpose of receiving payment of, or
on account of, the principal of and interest on the Bond and for all other purposes, and
payments so made to a registered owner or upon the owner's order will be valid and
effectual to satisfy and discharge the liability upon the Bond to the extent of the sum or
sums so paid.
(g) Taxes, Fees and Charges. The Registrar may impose a charge
upon the owner thereof for a transfer or exchange of Bonds, sufficient to reimburse the
Registrar for any tax, fee or other governmental charge required to be paid with respect to
the transfer or exchange.
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(h) Mutilated, Lost Stolen or Destroved 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 ofthe mutilated Bond or in lieu of and in substitution for a Bond destroyed,
stolen or lost, upon the payment of the reasonable expenses and charges of the Registrar
in connection therewith; and, in the case of a Bond destroyed, stolen or lost, upon filing
with the Registrar of evidence satisfactory to it that the Bond was destroyed, stolen or
lost, and of the ownership thereof, and upon furnishing to the Registrar an appropriate
bond or indemnity in form, substance and amount satisfactory to it and as provided by
law, in which both the City and the Registrar must be named as obligees. Bonds so
surrendered to the Registrar will be cancelled by the Registrar and evidence of such
cancellation must be given to the City. If the mutilated, destroyed, stolen or lost Bond
has already matured or been called for redemption in accordance with its terms it is not
necessary to issue a new Bond prior to payment.
(i) Redemption. In the event any of the Bonds are called for
redemption, notice thereof identifying the Bonds to be redeemed will be given by the
Registrar by mailing a copy of the redemption notice by first class mail (postage prepaid)
not more than 60 and not less than 30 days prior 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 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 authorized to
execute and deliver, on behalf of the City, a contract with the Registrar. Upon merger or
consolidation of the Registrar with another corporation, if the resulting corporation is a bank or
trust company authorized by law to conduct such business, the resulting corporation is authorized
to act as successor Registrar. The City agrees to pay the reasonable and customary charges of
the Registrar for the services performed. The City reserves the right to remove the Registrar
upon 30 days' notice and upon the appointment of a successor Registrar, in which event the
predecessor Registrar must deliver all cash and Bonds in its possession to the successor Registrar
and must deliver the bond register to the successor Registrar. On or before each principal or
interest due date, without further order of this Council, the City Finance Director must transmit
to the Registrar moneys sufficient for the payment of all principal and interest then due.
2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the
direction of the City 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
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facsimiles of the originals. If an officer whose signature or a facsimile of whose signature
appears on the Bonds ceases to be such officer before the delivery of any Bond, the signature or
facsimile will nevertheless be valid and sufficient for all purposes, the same as if the officer had
remained in office until delivery. Notwithstanding such execution, a Bond will not be valid or
obligatory for any purpose or entitled to any security or benefit under this Resolution unless and
until a certificate of authentication on the Bond has been duly executed by the manual signature
of an authorized representative of the Registrar. Certificates of authentication on different Bonds
need not be signed by the same representative. The executed celtificate 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 Manager will
deliver the same to the Purchaser upon payment of the purchase price in accordance with the
contract of sale heretofore made and executed, and the Purchaser is not obligated to see to the
application of the purchase price.
2.06. Temporary Bonds. The City may elect to deliver in lieu of printed definitive
Bonds one or more typewritten temporary Bonds in substantially the form set forth in Section 3
with such changes as may be necessary to reflect more than one maturity in a single temporary
bond. Upon the execution and delivery of definitive Bonds the temporary Bonds will be
exchanged therefor and cancelled.
Section 3. Form of Bond.
3.01. The Bonds will be printed or typewritten in substantially the following form:
No.R-
$
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF HOPKINS
GENERAL OBLIGATION STORM SEWER REVENUE BOND, SERIES 2003A
Rate
Maturity
Date of
Original Issue
CUSIP
June 1, 2003
Registered Owner: Cede & Co.
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The City of Hopkins, Minnesota, 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
principal sum of $ on the maturity date specified above, with interest thereon from
the date hereof at the annual rate specified above, payable February I and August I in each year,
commencing February I, 2004, to the person in whose name this Bond is registered at the close
of business on the fifteenth day (whether or not a business day) of the immediately preceding
month. The interest hereon and, upon presentation and surrender hereof, the principal hereof are
payable in lawful money of the United States of America by check or draft by 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 irrevocably pledged.
The City may elect on February I, 2011, and on any day thereafter to prepay Bonds due
on or after February 1,2012. Redemption may be in whole or in part and ifin part, at the option
of the City and in such manner as the City will determine. If less than all Bonds of a maturity are
called for redemption, the City will notify Depository Securities Trust Company (DTC) of the
particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each
participant's interest in such maturity to be redeemed and each participant will then select by lot
the beneficial ownership interests in such maturity to be redeemed. Prepayments will be at a
price of par plus accrued interest.
The City Council has designated the Bonds as "qualified tax exempt obligations" within
the meaning of Section 265(b)(3) of the Internal Revenue Code ofl986, as amended (the Code)
relating to disallowance of interest expense for financial institutions and within the $10 million
limit allowed by the Code for the calendar year of issue.
This Bond is one of an issue in the aggregate principal amount of $ all of like
original issue date and tenor, except as to number, maturity date, redemption privilege, and
interest rate, all issued pursuant to a resolution adopted by the City Council on May 20, 2003
(the Resolution), for the purpose of providing money to aid in financing various improvements to
the storm sewer system of the City, pursuant to and in full conformity with the home rule charter
of the City and the Constitution and laws of the State of Minnesota, including Minnesota
Statutes, Section 444.075 and Chapter 475 and the principal hereof and interest hereon are
payable primarily from the net revenues of the storm sewer system of the City in a special debt
service fund of the City, as set forth in the Resolution to which reference is made for a full
statement of rights and powers thereby conferred. The full faith and credit of the City are
in'evocably pledged for payment of this Bond and the City Council has obligated itself to levy
ad valorem taxes on all taxable property in the City in the event of any deficiency in net revenues
pledged, which taxes may be levied without limitation as to rate or amount. The Bonds of this
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series are issued only as fully registered Bonds in denominations of $5,000 or any integral
multiple thereof of single maturities.
IT IS HEREBY CERTIFIED AND RECITED That in and by the Resolution, the City has
covenanted and agreed that it will continue to own and operate the storm sewer system free from
competition by other like utilities; that adequate insurance on said plant and system and suitable
fidelity bonds on employees will be carried; that proper and adequate books of account will be
kept showing all receipts and disbursements relating to the Storm Sewer Fund, into which it will
pay all of the gross revenues from the storm sewer system; that it will also create and maintain a
General Obligation Storm Sewer Revenue Bonds, Series 2003A Debt Service Fund, into which it
will pay, out of the net revenues from the storm sewer system a sum sufficient to pay principal
hereof and interest thereon when due; and that it will provide, by ad valorem tax levies, for any
deficiency in required net storm sewer system revenues.
As provided in the Resolution and subject to certain limitations set forth therein, this
Bond is transferable upon the books of the City at the principal office of the Bond Registrar, by
the registered owner hereof in person or by the owner's attorney duly authorized in writing, upon
surrender hereof together with a written instrument of transfer satisfactory to the Bond Registrar,
duly executed by the registered owner or the owner's attorney; and may also be surrendered in
exchange for Bonds of other authorized denominations. Upon such transfer or exchange the City
will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of
the same aggregate principal amount, bearing interest at the same rate and maturing on the same
date, subject to reimbursement for any tax, fee or governmental charge required to be paid with
respect to such transfer or exchange.
The City and the 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 home rule charter of the City and the Constitution and laws
of the State of Minnesota to be done, to exist, to happen and to be performed preliminary to and
in the issuance of this Bond in order to make it a valid and binding general obligation of the City
in accordance with its terms, have been done, do exist, have happened and have been performed
as so required, and that the issuance of this Bond does not cause the indebtedness of the City to
exceed any constitutional, statutory or charter limitation of indebtedness.
This Bond is not valid or obligatory for any purpose or entitled to any security or benefit
under the Resolution until the Certificate of Authentication hereon has been executed by the
Bond Registrar by manual signature of one of its authorized 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 manual
signatures ofthe 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)
City Manager
(facsimile)
Mayor
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
BANKERS TRUST COMPANY
By
Authorized Representative
The following abbreviations, when used in the inscription on the face of this Bond, will
be construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants
III common
UNIF GIFT MIN ACT
(Cust)
Custodian
(Minor)
TEN ENT -- as tenants
by entireties
under Uniform Gifts or
Transfers to Minors
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JT TEN -- as joint tenants with
right of survivorship and
not as tenants in common
Act .................................
(State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond and all rights thereunder, and
does hereby irrevocably constitute and appoint attorney to
transfer the said Bond on the books kept for registration of the within Bond, with full power of
substitution in the premises.
Dated:
Notice:
The assignor's signature to this assignment must correspond
with the name as it appears upon the face of the within
Bond in every particular, without alteration or any change
whatever.
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the
Securities Transfer Agent Medallion Program CST AMP"), the Stock Exchange Medallion
Program CSEMP"), the New York Stock Exchange, Inc. Medallion Signatures Program
("MSP") or other such "signature program" as may be determined by the Registrar in addition to,
or in substitution for, STAMP, SEMP or MSP, all in accordance with the Securities Exchange
Act of 1934, as amended.
The Bond Registrar will not effect transfer of this Bond unless the information
concerning the assignee requested below is provided.
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Name and Address:
(Include information for all joint owners if this Bond is
held by j oint account.)
Please insert social security or
other identifying number of assignee
PROVISIONS AS TO REGISTRATION
The ownership of the principal of and interest on the within Bond has been registered on
the books of the Registrar in the name of the person last noted below.
Date of Registration
Registered Owner
Signature of
Officer of Registrar
Cede & Co.
Federal ID #13-2555119
3.02. The City Manager will obtain a copy of the proposed approving legal opinion of
Kennedy & Graven, Chartered, Minneapolis, Minnesota, which will be complete except as to
dating thereof and will cause the opinion to be printed on or accompany each Bond.
Section 4. Payment: Security: Pledges and Covenants.
4.01. The City will create and continue to operate its Storm Sewer Fund to which will be
credited all gross revenues of the storm sewer system described in Section 1.01 and out of which
will be paid all normal and reasonable expenses of current operations of the storm sewer system.
Any balances therein are deemed net revenues and will be transferred, from time to time, to a
General Obligation Storm Sewer Revenue Bonds, Series 2003A Debt Service Fund (Debt
Service Fund) hereby created in the Storm Sewer Utility Fund, which fund will be used only to
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pay principal of and interest on the Bonds and any other bonds similarly authorized. There will
always be retained in the Debt Service Fund a sufficient amount to pay principal of and intercst
on all the Bonds, and the City Finance Director must report any current or anticipated deficiency
in the Debt Service Fund to the City Council. There is appropriated to the Debt Service Fund all
capitalized interest financed from Bond proceeds, if any, any amount over the minimum
purchase price of the Bonds paid by the Purchaser and all accrued interest paid by the Purchaser
upon closing and delivery of the Bonds.
4.02. The City Council covenants and agrees with the holders of the Bonds that so long
as any of the Bonds remain outstanding and nnpaid, it will keep and enforce the following
covenants and agreements:
(a) The City will continue to maintain and efficiently operate the
storm sewer system as public utilities and conveniences free from competition of other
like utilities and will cause all revenues therefrom to be deposited in bank accounts and
credited to the storm sewer system accounts as hereinabove provided, and will make no
expenditures from those accounts except for a duly authorized purpose and in accordance
with this resolution.
(b) The City will also maintain the Debt Service Fund as a separate
account in the Storm Sewer Fund and will cause money to be credited thereto from time
to time, out of net revenues from the storm sewer plant and system in sums sufficient to
pay principal of and interest on the Bonds when due.
(c) The City will keep and maintain proper and adequate books of
records and accounts separate from all other records of the City in which will be
complete and correct entries as to all transactions relating to the storm sewer system and
which will be open to inspection and copying by any bond holder, or the holder's agent or
attorney, at any reasonable time, and it will furnish certified transcripts therefrom upon
request and upon payment of a reasonable fee therefor, and said account will be audited
at least annually by a qualified public accountant and statements of such audit and report
will be furnished to all bondholders upon request.
(d) The City Council will cause persons handling revenues of the
storm sewer system to be bonded in reasonable amounts for the protection of the City and
the bondholders and will cause the funds collected on account of the operations of the
storm sewer system to be deposited in a bank whose deposits are guaranteed under the
Federal Deposit Insurance Law.
(e) The Council will keep the storm sewer system insured at all times
against loss by fire, tornado and other risks customarily insured against with an insurer or
insurers in good standing, in such amounts as are customary for like plants, to protect the
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holders, from time to time, of the Bonds and the City from any loss due to any such
casualty and will apply the proceeds of such insurance to make good any such loss.
(f) The City and each and all of its officers will punctually perform all
duties with reference to the storm sewer system as required by law.
(g) The City will impose and collect charges of the nature authorized
by Minnesota Statutes, section 444.075 at the times and in the amounts required to
produce net revenues adequate to pay all principal and interest when due on the Bonds
and to create and maintain such reserves securing said payments as may be provided in
this resolution.
(h) The City Council will levy general ad valorem taxes on all taxable
property in the City, when required to meet any deficiency in net revenues.
4.03. It is hereby determined that the estimated collection of net revenues for the
payment of principal and interest on the Bonds will produce at least five percent in excess of the
amount needed to meet, when due, the principal and interest payments on the Bonds and that no
tax levy is needed at this time.
4.04. The City Manager is authorized and directed to file a certified copy of this
resolution with the Taxpayer Services Division Manager of Hennepin County and to obtain the
certificate required by Minnesota Statutes, Section 475.63.
Section 5. Authentication of Transcript.
5.01. The officers of the City are authorized and directed to prepare and furuish to the
Purchaser and to the attorneys approving the Bonds, certified copies of proceedings and records
of the City relating to the Bonds and to the financial condition and affairs of the City, and such
other certificates, affidavits and transcripts as may be required to show the facts within their
knowledge or as shown by the books and records in their custody and under their control,
relating to the validity and marketability of the Bonds, and such instruments, including any
heretofore furnished, will be deemed representations of the City as to the facts stated therein.
5.02. The Mayor and City Manager 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 authorizes the Purchaser to forward the amount of Bond proceeds
allocable to the payment of issuance expenses (other than amounts payable to Kennedy &
Graven, Chartered as Bond Counsel) to U.S. Trust Company, Milmeapolis, Minnesota on the
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closing date for further distribution 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 permit to be taken by any of its officers, employees or agents any action which
would cause the interest on the Bonds to become subject to taxation under the Internal Revenue
Code of 1986, as amended (the Code), and the Treasury Regulations promulgated thereunder, in
effect at the time of such actions, and that it will take or cause its officers, employees or agents to
take, all affirmative action within its power that may be necessary to ensure that such interest
will not become subject to taxation under the Code and applicable Treasury Regulations, as
presently existing or as hereafter amended and made applicable to the Bonds.
6.02. (a) 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 if the Bonds (together with other
obligations reasonably expected to be issued in calendar year 2003) exceed the small-issuer
exception amount of $S,OOO,OOO.
(b) For purposes of qualifying for the small issuer exception to the federal arbitrage
rebate requirements, the City finds, determines and declares that the aggregate face amount of all
tax-exempt bonds (other than private activity bonds) issued by the City (and all subordinate
entities of the City) during the calendar year in which the Bonds are issued and outstanding at
one time is not reasonably expected to exceed $S,OOO,OOO, all within the meaning of Section
148(f)(4)(C) of the Code.
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 manner as to cause the Bonds to be "private
activity bonds" within the meaning of Sections 103 and 141 through ISO of the Code.
6.04. In order to qualify the Bonds as "qualified tax-exempt obligations" within the
meaning of Section 26S(b)(3) of the Code, the City makes the following factual statements and
representations:
(a)
141 of the Code;
the Bonds are not "private activity bonds" as defined in Section
(b) the City designates the Bonds as "qualified tax-exempt
obligations" for purposes of Section 26S(b)(3) of the Code;
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(c) the reasonably anticipated amount of tax-exempt obligations (other
than private activity bonds, that are not qualified 501(c)(3) bonds) which will be issued
by the City (and all subordinate entities of the City) during calendar year 2003 will not
exceed $10,000,000; and
(d) not more than $10,000,000 of obligations issued by the City during
calendar year 2003 have been designated for purposes of Section 265(b )(3) of the Code.
6.05. The City will use its best efforts to comply with any federal procedural
requirements which may apply in order to effectuate the designations made by this section.
Section 7. Book-Entry System; Limited Obligation of City.
7.01. The Bonds will be initially issued in the form of a separate single typewritten or
printed fully registered Bond for each of the maturities set forth in Section 1.03 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 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 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 from time to time for which DTC holds Bonds as securities depository
(Participants) or to any other person on behalf of which a Participant holds an interest in the
Bonds, including but not limited to any responsibility or obligation with respect to (i) the
accuracy of the records of DTC, Cede & Co. or any Participant with respect to any ownership
interest in the Bonds, (ii) the delivery to any Participant or any other person (other than a
registered owner of Bonds, as shown by the registration books kept by the 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 principal, premium and interest with respect to such Bond,
for the purpose of registering 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 principal of, premium, if any, or interest on the
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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 DTC 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 ofDTC; 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 DTC a
Blanket Issuer Letter of Representations (Representation Letter) which will govern 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-Entrv Svstem. In the event the City, by resolution of the
City Council, determines that it is in the best interests of the persons having beneficial interest, in
the Bonds that they be able to obtain Bond certificates, the City will notify DTC, whereupon
DTC will notify the Participants, of the availability through DTC of Bond certificates. In such
event the City will issue, transfer and exchange Bond certificates as requested by DTC and any
other registered owners in accordance with the provisions of this Resolution. DTC may
determine to discontinue providing its services with respect to the Bonds at any time by giving
notice to the City and discharging its responsibilities with respect thereto under applicable law.
In such event, if no successor securities depository is appointed, the City will issue and the 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 of this Resolution to
the contrary, so long as a Bond is registered in the name of Cede & Co., as nominee of DTC,
payments with respect to principal of, premium, ifany, 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 Arrangements, as set forth 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. Notwithstanding any other 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 necessary and appropriate, including seeking mandate or specific
performance by court order, to cause the City to comply with its obligations under this section.
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8.02. "Continuing Disclosure Certificate" means that certain Continuing Disclosure
Certificate executed by the Mayor and City Manager and dated the date of issuance and delivery
of the Bonds, as originally executed and as it may be amended from time to time in accordance
with the terms thereof.
Passed and adopted this 20 day of May, 2003.
CITY OF HOPKINS, MINNESOTA
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