12-14-15 EDA Agenda P
CITY OF SHOREWOOD 5755 COUNTRY CLUB ROAD
ECONOMIC DEVELOPMENT AUTHORITY MEETING COUNCIL CHAMBERS
MONDAY, DECEMBER 14, 2015 7:30 PM, or Immediately following
Regular City Council Meeting
AGENDA
1. CONVENE ECONOMIC DEVELOPMENT AUTHORITY MEETING
A. Roll Call
President Zerby _____
Labadie _____
Siakel _____
Sundberg _____
Woodruff _____
B. Review Agenda
2. APPROVAL OF MINUTES
A. Approval of the October 26, 2015 meeting Minutes (Att. – Minutes)
3. NEW BUSINESS
A. Ratify Public Safety Facility Refunding Bond Sale (Att. - Asst. Treasurer’s memo)
4. ADJOURN
#2A
CITY OF SHOREWOOD 5755 COUNTRY CLUB ROAD
ECONOMIC DEVELOPMENT AUTHORITY MEETING COUNCIL CHAMBERS
MONDAY, OCTOBER 26, 2015 Immediately following Regular City
Council Meeting
MINUTES
1. CONVENE ECONOMIC DEVELOPMENT AUTHORITY MEETING
President Zerby called the meeting to order at 9:12 P.M.
A. Roll Call
Present. President Zerby; Boardmembers Labadie, Siakel, Sundberg and Woodruff; Executive
Director/Secretary Joynes; Assistant Treasurer DeJong; Assistant Executive Director
Nielsen; and Attorney Keane
Absent: None
B. Review Agenda
Sundberg moved, Woodruff seconded, approving the agenda as presented. Motion passed 5/0.
2. APPROVAL OF MINUTES
A. EDA Minutes of July 27, 2015
Labadie moved, Siakel seconded, approving the EDA Meeting Minutes of July 27. 2015, as
presented. Motion passed 5/0.
3. NEW BUSINESS
A. Public Safety Facilities Bond Refunding
Assistant Treasurer DeJong explained the Shorewood Economic Development Authority (EDA) has
received copies of adopted resolutions from the Excelsior Fire District (EFD) Board, the South Lake
Minnetonka Police Department (SLMPD) Coordinating Committee, the City of Deephaven and the City of
Shorewood requesting the EDA issue refunding bonds for the 2007A, 2007B and 2007C series bonds for
the public safety facilities. The 2007A series is for the Fire Department facility located in Shorewood. The
2007B series is for the SLMPD facility located in Shorewood. The 2007C series is for the Fire Department
facility located in Deephaven. The reason for doing this is to save on interest expenses. It is anticipated the
total savings would be in excess of $350,000 over the life of the bonds which is 2022 and 2023. The EDA
Board is being asked to give preliminary authorization to do this by adopting the resolution included in the
meeting packet. It is anticipated that the bond sale would be a negotiated sale which would be similar to
what was done for the 2007 series refunding bonds. He noted this bond sale is somewhat complicated
because five cities are involved.
Shorewood staff and EDA staff have been approaching selected underwriters in the Twin Cities who are
familiar with the situation from previous bond issues. It is anticipated the results would be received by
CITY OF SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY MEETING
October 26, 2015
Page 2 of 2
October 29. The plan is to price the bonds the week of December 7. That should be presented to Council
and the EDA Board on December 14.
Boardmember Sundberg asked if there would be any downside to doing this. Assistant Treasurer DeJong
responded absolutely not.
Boardmember Woodruff stated a couple of weeks ago he asked Assistant Treasurer DeJong if the EDA
would be able to get a little discount off the rate provided before for services to issue the refunding bonds.
The paper work would be every similar to that prepared in 2006/2007 for the issuance of refunding bonds
in 2007. He asked Assistant Treasurer DeJong if he has gotten an answer to that. DeJong stated there have
not been discussions about the bond counsel fee yet.
Sundberg moved, Labadie seconded, Adopting RESOLUTION NO. 15-001, “A Resolution Giving
Preliminary Approval to Issuance of Refunding Bonds Related to Certain Public Safety Facilities.”
Motion passed 5/0.
B. Adoption of a Post Insurance Policy
Assistant Treasurer DeJong explained the federal rules on bonds for municipalities have changed since the
last time the EDA issued bonds so the EDA needs to implement a compliance policy. Shorewood Council
adopted such a policy for the City before the sale of the General Obligation Water Revenue Refunding
Bonds in 2013. The meeting packet contains a copy of document titled Post-Issuance Compliance
Procedure and Policy for Tax-Exempt Governmental Bonds for Council’s approval.
Siakel moved, Woodruff seconded, approving the Post-Issuance Compliance Procedure and Policy
for Tax-Exempt Governmental Bonds. Motion passed 5/0.
4. ADJOURN
Woodruff moved, Siakel seconded, Adjourning the Shorewood Economic Development Authority
Meeting of October 26, 2015, at 9:19 P.M. Motion passed 5/0.
RESPECTFULLY SUBMITTED,
Christine Freeman, Recorder
Scott Zerby, President
ATTEST:
William S. Joynes, Executive Director
#3A
MEETING TYPE
Special Meeting
City of Shorewood Economic Development Authority
Title / Subject: Ratify Public Safety Facility Refunding Bond Sale
Meeting Date: December 14, 2015
Prepared by: Bruce DeJong, Asst. Treasurer
Policy Consideration:
Should the Shorewood Economic Development Authority (EDA) issue refunding bonds at this time to
generate interest cost savings?
Background:
The City's bond consultants, Springsted, Inc., assisted us in a negotiated sale of the bonds with
Northland Financial on December 9. The results of the sale were substantial savings in interest costs
over the remaining life of the bonds.
2016A 2016E 2016C
12/9/15 Savings $170,836 $174,239 $32,413
NPV Debt Service 6.381% 6.273% 3.527%
These savings are in line with the parameters approved by each joint powers agency.
Financial or Budget Considerations:
This refunding saves in excess of $350,000 on a net present value basis. The 3.5 -6% savings are in excess
of the 3% minimum savings required by state statute for advance refunding bonds.
Options:
The EDA Board may choose to:
1. Authorize the resolutions.
Recommendation / Action Requested:
Staff recommends adoption of the Resolutions Ratifying Public Safety Lease Revenue Refunding Bonds
Series 2016A, B & C.
Next Steps and Timelines:
The bonds will close in January, 2016.
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SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION RATIFYING THE SALE OF PUBLIC SAFETY FIRE FACILITY
LEASE REVENUE REFUNDING BONDS, SERIES 2016A (CITY OF
SHOREWOOD, MINNESOTA LEASE OBLIGATION); AND PROVIDING FOR
THE REDEMPTION OF BONDS REFUNDED THEREBY
BE IT RESOLVED By the Board of Commissioners (the "Board ") of the Shorewood Economic
Development Authority (the "Authority ") as follows:
Section 1. Background: Authorization.
(a) The City of Shorewood, Minnesota (the "City ") is authorized by Minnesota
Statutes, Section 465.71, as amended, to acquire real and personal property under lease -
purchase agreements.
(b) The Authority has agreed with the Excelsior Fire District (the "District ") and the
South Lake Minnetonka Police Department (the "Department ") that pursuant to the Ground
Lease (West Side), dated as of September 1, 2002 (the "Original Ground Lease "), as amended by
a First Amendment to Ground Lease (West Side), dated as of April 15, 2003 (the "First
Amendment to Ground Lease "), and a Second Amendment to Ground Lease, dated as of January
1, 2007 (the "Second Amendment to Ground Lease "), the Authority will acquire certain property
from the District and the Department. The Authority will lease such property, together with
certain buildings, structures or improvements now or hereafter located thereon (the "Fire
Facilities "), to the City pursuant to a Lease Purchase Agreement (West Side Fire Facilities), dated
as of September 1, 2002 (the "Original Lease "), as amended by a First Amendment to Lease
Purchase Agreement (West Side Fire Facilities), dated as of April 15, 2003 (the "First
Amendment to Lease "), and a Second Amendment to Lease Purchase Agreement (West Side Fire
Facilities), dated as of January 1, 2007 (the "Second Amendment to Lease ").
(c) With the Authority's consent, the City has entered into a Sublease Purchase
Agreement (West Side Fire Facilities), dated as of September 1, 2002 (the "Sublease "), with the
District, pursuant to which the District undertakes the City's obligations under the Lease
(hereinafter defined).
(d) Pursuant to a Trust Indenture, dated as of September 1, 2002 (the "Original
Indenture "), between the Authority and U.S. Bank National Association, as trustee (the
"Trustee "), as supplemented by a First Supplemental Trust Indenture, dated as of April 15, 2003
(the "First Supplemental Indenture "), and a Second Supplemental Trust Indenture, dated as of
January 1, 2007 (the "Second Supplemental Indenture "), the Authority issued its Public Safety
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Fire Facility Lease Crossover Refunding Revenue Bonds, Series 2007A (City of Shorewood,
Minnesota Lease Obligation) (the "Series 2007A Bonds "), in the original aggregate principal
amount of $4,130,000. Proceeds of the Series 2007A Bonds were used to achieve the advance
crossover refunding of the Authority's (i) Public Safety Fire Facility Lease Revenue Bonds, Series
2002A (City of Shorewood, Minnesota Lease Obligation) (the "Series 2002A Bonds "), issued in
the original aggregate principal amount of $3,865,000; and (ii) Public Safety Fire Facility Lease
Revenue Bonds, Series 2003A (City of Shorewood, Minnesota Lease Obligation) (the "Series
2003A Bonds "), issued in the original aggregate principal amount of $1,195,000. Proceeds of
the Series 2002A Bonds and the Series 2003A Bonds financed a portion of the cost of the
acquisition, construction, and equipping of the Fire Facilities.
(e) The Authority has determined to redeem and prepay the outstanding
Series 2007A Bonds through the issuance of its Public Safety Fire Facility Lease Revenue
Refunding Bonds, Series 2016A (City of Shorewood, Minnesota Lease Obligation) (the
"Series 2016A Bonds "), in the original aggregate principal amount of $2,470,000.
(f) The Series 2016A Bonds will be issued under the terms of a Third Supplemental
Trust Indenture, dated as of January 1, 2016 (the "Third Supplemental Indenture," and
collectively with the Original Indenture, the First Supplemental Indenture, and the Second
Supplemental Indenture, the "Indenture "), between the Authority and the Trustee, as Additional
Bonds pursuant to the Indenture.
(g) In connection with the issuance of the Series 2016A Bonds, the Authority will
(i) enter into a Third Amendment to Ground Lease (West Side), dated as of January 1, 2016 (the
"Third Amendment to Ground Lease," and collectively with the Original Ground Lease, the First
Amendment to Ground Lease, and the Second Amendment to Ground Lease, the "Ground
Lease "), with the District and the Department; and (ii) enter into a Third Amendment to Lease
Purchase Agreement (West Side Fire Facilities), dated as of January 1, 2016 (the "Third
Amendment to Lease," and collectively with the Original Lease, the First Amendment to Lease,
and the Second Amendment to Lease, the "Lease "), with the City.
(h) Pursuant to an Assignment and Security Agreement, dated as of
September 1, 2002 (the "Original Assignment "), between the Authority and the Trustee, as
modified by a First Supplemental Assignment and Security Agreement, dated as of April 15, 2003
(the "First Supplemental Assignment "), a Second Supplemental Assignment and Security
Agreement, dated as of January 1, 2007 (the "Second Supplemental Assignment "), and a Third
Supplemental Assignment and Security Agreement, dated as of January 1, 2016 (the "Third
Supplemental Assignment," and collectively with the Original Assignment, the First
Supplemental Assignment, and the Second Supplemental Assignment, the "Assignment "), the
Authority will assign to the Trustee all of the Authority's right, title and interest in and to the
Ground Lease, the Lease, and the Lease Payments to be made by the City under the Lease (the
"Lease Payments "), other than certain rights to indemnification and payment of expenses, as
security for the Series 2016A Bonds.
Error! Unknown document property name. 3
(i) Forms of the Third Amendment to Ground Lease, the Third Amendment to Lease,
the Third Supplemental Indenture, and the 'Third Supplemental Assignment have been prepared and
submitted to the Authority and are on file with the Authority.
(j) On October 26, 2015, the Board authorized Authority staff and consultants to
negotiate the sale of the Series 2016A Bonds, subject to ratification by the Board.
Section 2. Sale of Series 2016A Bonds.
2.01. Award to the Purchaser and Interest Rates. The proposal of Northland Securities, Inc.,
Minneapolis, Minnesota (the "Purchaser "), to purchase the Series 2016A Bonds is hereby found and
determined to be a reasonable offer, and the Board hereby ratifies the actions of Authority staff and
consultants in accepting the Purchaser's proposal, said proposal being to purchase the Series 2016A
Bonds at a price of $2,493,634.00 (par amount of $2,470,000.00, plus original issue premium of
$40,677.00, less underwriter's discount of $17,043.00), plus accrued interest to date of delivery, if any,
for Series 2016A Bonds bearing interest as follows:
Year Interest Rate
Year Interest Rate
2017
2.000% 2021 2.000%
2018
2.000 2022 2.000
2019
2.000 2023 2.000
2020
2.000
2.02. Purchase Contract. The actions of the President and the Executive Director to execute a
contract with the Purchaser on behalf of the Authority are hereby ratified and approved.
2.02. Terms and Principal Amounts of the Series 2016A Bonds. The Authority will forthwith
issue and sell the Series 2016A Bonds in the total principal amount of $2,470,000, originally dated
January 7, 2016, in the denomination of $5,000 each or any integral multiple thereof, numbered No. R -1,
upward, bearing interest as above set forth, and maturing serially on February 1, in the years and
amounts as follows:
Year
Amount
Year
Amount
2017
$325,000
2021
$360,000
2018
340,000
2022
370,000
2019
350,000
2023
375,000
2020
350,000
2.03. Redemption.
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(a) Optional Redemption. The Series 2016A Bonds are not subject to optional
redemption prior to maturity.
(b) Extraordinary Redemption. The Series 2016A Bonds are subject to
extraordinary redemption, at the option of the Authority, on any business day, in whole or in
part, at a redemption price equal to par plus accrued interest to the redemption date, upon the
happening of certain events of damage to or destruction or condemnation of the Site or the Fire
Facilities or change of law rendering the Lease unenforceable or impossible of performance, as
more fully described in the Indenture and the Lease.
2.04. Execution, Authentication and Delivery. The Series 2016A Bonds, substantially in the
form provided in the Indenture, will be prepared under the direction of the Authority staff and executed
on behalf of the Authority by the signatures of the President and the Executive Director, provided that
all signatures may be printed, engraved or lithographed facsimiles of the originals. Notwithstanding
such execution, a Series 2016A Bond will not be valid or obligatory for any purpose or entitled to any
security or benefit under this resolution or the Indenture unless and until a certificate of authentication
on the Series 2016A Bond has been duly executed by the manual signature of an authorized
representative of the Trustee. When the Series 2016A Bonds have been so prepared, executed and
authenticated, the Authority will deliver the same to The Depository Trust Company, New York, New
York, on behalf of the Purchaser, upon payment of the purchase price, and the Purchaser is not
obligated to see to the application of the purchase price.
Section 3. Approval and Execution of Documents. The Third Amendment to Ground Lease,
the Third Amendment to Lease, the Third Supplemental Indenture, and the Third Supplemental
Assignment are hereby approved. The President and the Executive Director are authorized and directed
to execute and deliver the Third Amendment to Ground Lease, the Third Amendment to Lease, the Third
Supplemental Indenture, and the Third Supplemental Assignment on behalf of the Authority,
substantially in the forms now on file, but with all such changes therein as shall be approved by the
officers executing the same, which approval shall be conclusively evidenced by the execution thereof.
Copies of all of the transaction documents shall be delivered, filed and recorded as provided therein.
The President and the Executive Director are also authorized and directed to execute such other
instruments as may be required to give effect to the transactions herein contemplated.
Section 4. Payment; Security; Pledges and Covenants. The Series 2016A Bonds are payable
solely from the Lease Payments to be made by the City under the Lease and by the District under the
Sublease and from other moneys realized by the Trustee after default or termination of the Lease by the
City as provided therein. No property or funds of the Authority, other than the property pledged
pursuant to the Indenture and assigned to the Trustee pursuant to the Assignment, is pledged to the
payment of the Series 2016A Bonds.
Error? Unknown document property, name. 5
Section 5. Refunding: Findings: Redemption of Series 2007A Bonds.
5.01. Reduction of Debt Service Cost. It is hereby found and determined that based upon
information presently available from the Authority's municipal advisor, the issuance of the Series 2016A
Bonds is necessary and desirable for the reduction of debt service cost to the Authority, the City, and the
District.
5.03. Redemption of Series 2007A Bonds. The Series 2007A Bonds maturing on
February 1, 2017 and thereafter will be redeemed and prepaid on February 15, 2016. The Series 2007A
Bonds will be redeemed and prepaid in accordance with their terms and in accordance with the terms
and conditions set forth in EXHIBIT A attached hereto. The Trustee, as trustee for the Series 2007A
Bonds, is authorized and directed to send a copy of the Notice of Call for Redemption to each registered
holder of the Series 2007A Bonds.
Section 6. Authentication of Transcript; Issuance Costs.
6.01. Authority Proceedings and Records. The officers of the Authority are authorized and
directed to prepare and furnish to the Purchaser and to the attorneys approving the Series 2016A
Bonds, certified copies of proceedings and records of the Authority relating to the Series 2016A Bonds
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 Series 2016A Bonds and such instruments, including any heretofore
furnished, may be deemed representations of the Authority as to the facts stated therein.
6.02. Certification as to Official Statement. The President and the Executive 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 Series 2016A 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.
6.03. Other Certificates. The President and the Executive Director are hereby authorized and
directed to furnish to the Purchaser at the closing such certificates as are required as a condition of sale.
Unless litigation shall have been commenced and be pending questioning the Series 2016A Bonds or the
organization of the Authority or incumbency of its officers, at the closing the President and the
Executive Director shall also execute and deliver to the Purchaser a suitable certificate as to absence of
material litigation, and the Executive Director shall also execute and deliver a certificate as to payment
for and delivery of the Series 2016A Bonds.
Section 7. Tax Covenants.
7.01. Tax - Exempt Bonds. The Authority covenants and agrees with the holders from time to
time of the Series 2016A 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 Series 2016A Bonds to become
Error! Unknown document property name. 6
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 Series 2016A Bonds.
7.02. Rebate. The Authority will comply with requirements necessary under the Code to
establish and maintain the exclusion from gross income of the interest on the Series 2016A 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 Series 2016A
Bonds.
7.03. Not Private Activity Bonds. The Authority further covenants not to use the proceeds of
the Series 2016A Bonds or to cause or permit them or any of them to be used, in such a manner as to
cause the Series 2016A Bonds to be "private activity bonds" within the meaning of Sections 103 and 141
through 150 of the Code.
7.04. Qualified Tax - Exempt Obligations. In order to qualify the Series 2016A Bonds as
"qualified tax - exempt obligations" within the meaning of Section 265(b)(3) of the Code, the Authority
makes the following factual statements and representations:
(a) the Series 2016A Bonds are not "private activity bonds" as defined in
Section 141 of the Code;
(b) the Authority hereby designates the Series 2016A Bonds as "qualified
tax - exempt obligations" for purposes of Section 265(b)(3) of the Code;
(c) the reasonably anticipated amount of tax - exempt obligations (other than any
private activity bonds that are not qualified 501(c)(3) bonds) which will be issued by the
Authority (and all subordinate entities of the City) during calendar year 2016 will not exceed
$10,000,000; and
(d) not more than $10,000,000 of obligations issued by the Authority during
calendar year 2016 have been designated for purposes of Section 265(b)(3) of the Code.
7.05. Procedural Requirements. The Authority 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.
Error! Unknown document property name. 7
Approved by the Board of Commissioners of the Shorewood Economic Development Authority
this 14th day of December, 2015.
President
ATTEST:
Secretary
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EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
$4,130,000
SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY
PUBLIC SAFETY FIRE FACILITY LEASE REVENUE
CROSSOVER REFUNDING BONDS
SERIES 2007A
(CITY OF SHOREWOOD, MINNESOTA LEASE OBLIGATION)
NOTICE IS HEREBY GIVEN that, by order of the Board of Commissioners of the Shorewood
Economic Development Authority (the "Authority "), there have been called for redemption and
prepayment on
February 15, 2016
all outstanding bonds of the Authority designated as the Public Safety Fire Facility Lease Revenue
Crossover Refunding Bonds, Series 2007A (City of Shorewood, Minnesota Lease Obligation) (the
"Bonds "), dated as of January 1, 2007, having stated maturity dates of February 1 in the years 2017
through 2023, both inclusive, totaling $2,395,000 in principal amount, and with the following CUSIP
numbers:
Year of Maturity
Amount
CUSIP
2017
$300,000
825228
DI-19
2018
315,000
825228
DJ5
2019
330,000
825228
DK2
2020
340,000
825228
DLO
2022
725,000
825228
DN6
2023
385,000
825228
DPI
The Bonds are being called at a price of par plus accrued interest to February 15, 2016, on which
date all interest on said Bonds will cease to accrue. Holders of the Bonds hereby called for redemption
are requested to present their Bonds for payment at the main office of the Trustee in the City of Saint
Paul, Minnesota, at the following address, on or before February 15, 2016:
If by mail:
U.S. Bank National Association
Corporate Trust Operations, 3rd Floor
P.O. Box 64111
St. Paul, MN 55164 -0111
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If by hand or overnight:
U.S. Bank National Association
60 Livingston Avenue
EP- MN -WS3C
Bond Drop Window, 1s' Floor
St. Paul, MN 55107
Important Notice: In compliance with the Economic Growth and Tax Relief Reconciliation Act of
2009, the Trustee is required to withhold a specified percentage of the principal amount of the
redemption price payable to the holder of any Bonds subject to redemption and prepayment on the
redemption date, unless the Trustee is provided with the Social Security Number or Federal Employer
Identification Number of the holder, properly certified. Submission of a fully executed Request for
Taxpayer Identification Number and Certification, Form W -9 (Rev. December 2011), will satisfy the
requirements of this paragraph.
Dated:
BY ORDER OF THE BOARD OF COMMISSIONERS
OF THE SHOREWOOD ECONOMIC
DEVELOPMENT AUTHORITY
By s Bill Joynes
Executive Director
Shorewood Economic Development
Authority
Error! Unknown document property name. 2
SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.
RESOLUTION RATIFYING THE SALE OF PUBLIC SAFETY FIRE FACILITY
LEASE REVENUE REFUNDING BONDS, SERIES 2016B (CITY OF
SHOREWOOD, MINNESOTA LEASE OBLIGATION); AND PROVIDING FOR
THE REDEMPTION OF BONDS REFUNDED THEREBY
BE IT RESOLVED By the Board of Commissioners (the "Board ") of the Shorewood Economic
Development Authority (the "Authority ") as follows:
Section 1. Background; Authorization.
(a) The City of Shorewood, Minnesota (the "City ") is authorized by Minnesota
Statutes, Section 465.71, as amended, to acquire real and personal property under lease -
purchase agreements.
(b) The Authority has agreed with the Excelsior Fire District (the "District ") and the
South Lake Minnetonka Police Department (the "Department ") that pursuant to the Ground
Lease (West Side), dated as of September 1, 2002 (the "Original Ground Lease "), as amended by
a First Amendment to Ground Lease (West Side), dated as of April 15, 2003 (the "First
Amendment to Ground Lease "), and a Second Amendment to Ground Lease, dated as of January
1, 2007 (the "Second Amendment to Ground Lease "), the Authority will acquire certain property
from the District and the Department. The Authority will lease such property, together with
certain buildings, structures or improvements now or hereafter located thereon (the "Police
Facilities "), to the City pursuant to a Lease Purchase Agreement (West Side Police Facilities),
dated as of September 1, 2002 (the "Original Lease "), as amended by a First Amendment to
Lease Purchase Agreement (West Side Police Facilities), dated as of April 15, 2003 (the "First
Amendment to Lease "), and a Second Amendment to Lease Purchase Agreement (West Side
Police Facilities), dated as of January 1, 2007 (the "Second Amendment to Lease ").
(c) With the Authority's consent, the City has entered into a Sublease Purchase
Agreement (West Side Police Facilities), dated as of September 1, 2002 (the "Sublease "), with
the District, pursuant to which the District undertakes the City's obligations under the Lease
(hereinafter defined).
(d) Pursuant to a Trust Indenture, dated as of September 1, 2002 (the "Original
Indenture "), between the Authority and U.S. Bank National Association, as trustee (the
"Trustee "), as supplemented by a First Supplemental Trust Indenture, dated as of April 15, 2003
(the "First Supplemental Indenture "), and a Second Supplemental Trust Indenture, dated as of
January 1, 2007 (the "Second Supplemental Indenture "), the Authority issued its Public Safety
Police Facility Lease Crossover Refunding Revenue Bonds, Series 2007B (City of Shorewood,
Minnesota Lease Obligation) (the "Series 2007B Bonds "), in the original aggregate principal
amount of $4,285,000. Proceeds of the Series 2007B Bonds were used to achieve the advance
crossover refunding of the Authority's (i) Public Safety Police Facility Lease Revenue Bonds,
Series 2002B (City of Shorewood, Minnesota Lease Obligation) (the "Series 2002B Bonds "),
Error! Unknown document property name. 3
issued in the original aggregate principal amount of $4,025,000; and (ii) Public Safety Police
Facility Lease Revenue Bonds, Series 2003B (City of Shorewood, Minnesota Lease Obligation)
(the "Series 2003B Bonds "), issued in the original aggregate principal amount of $1,220,000.
Proceeds of the Series 2002B Bonds and the Series 2003B Bonds financed a portion of the cost
of the acquisition, construction, and equipping of the Police Facilities.
(e) The Authority has determined to redeem and prepay the outstanding
Series 200713 Bonds through the issuance of its Public Safety Police Facility Lease Revenue
Refunding Bonds, Series 2016B (City of Shorewood, Minnesota Lease Obligation) (the
"Series 2016B Bonds "), in the original aggregate principal amount of $2,565,000
(f) The Series 2016B Bonds will be issued under the terms of a Third Supplemental
Trust Indenture, dated as of January 1, 2016 (the "Third Supplemental Indenture," and
collectively with the Original Indenture, the First Supplemental Indenture, and the Second
Supplemental Indenture, the "Indenture "), between the Authority and the Trustee, as Additional
Bonds pursuant to the Indenture.
(g) In connection with the issuance of the Series 20166 Bonds, the Authority will
(i) enter into a Third Amendment to Ground Lease (West Side), dated as of January 1, 2016 (the
"Third Amendment to Ground Lease," and collectively with the Original Ground Lease, the First
Amendment to Ground Lease, and the Second Amendment to Ground Lease, the "Ground
Lease "), with the District and the Department; and (ii) enter into a Third Amendment to Lease
Purchase Agreement (West Side Police Facilities), dated as of January 1, 2016 (the "Third
Amendment to Lease," and collectively with the Original Lease, the First Amendment to Lease,
and the Second Amendment to Lease, the "Lease "), with the City.
(h) Pursuant to an Assignment and Security Agreement, dated as of
September 1, 2002 (the "Original Assignment "), between the Authority and the Trustee, as
modified by a First Supplemental Assignment and Security Agreement, dated as of April 15, 2003
(the "First Supplemental Assignment "), a Second Supplemental Assignment and Security
Agreement, dated as of January 1, 2007 (the "Second Supplemental Assignment "), and a Third
Supplemental Assignment and Security Agreement, dated as of January 1, 2016 (the "Third
Supplemental Assignment," and collectively with the Original Assignment, the First
Supplemental Assignment, and the Second Supplemental Assignment, the "Assignment "), the
Authority will assign to the Trustee all of the Authority's right, title and interest in and to the
Ground Lease, the Lease, and the Lease Payments to be made by the City under the Lease (the
"Lease Payments "), other than certain rights to indemnification and payment of expenses, as
security for the Series 2016B Bonds.
(i) Forms of the Third Amendment to Ground Lease, the Third Amendment to Lease,
the Third Supplemental Indenture, and the Third Supplemental Assignment have been prepared and
submitted to the Authority and are on file with the Authority.
0) On October 26, 2015, the Board authorized Authority staff and consultants to
negotiate the sale of the Series 2016B Bonds, subject to ratification by the Board.
Section 2. Sale of Series 2016B Bonds.
Error! Unknown document property name. 4
2.01. Award to the Purchaser and Interest Rates. The proposal of Northland Securities, Inc.,
Minneapolis, Minnesota (the "Purchaser "), to purchase the Series 2016B Bonds is hereby found and
determined to be a reasonable offer, and the Board hereby ratifies the actions of Authority staff and
consultants in accepting the Purchaser's proposal, said proposal being to purchase the Series 2016B
Bonds at a price of $2,589,513.70 (par amount of $2,565,000.00, plus original issue premium of
$42,212.20, less underwriter's discount of $17,698.50), plus accrued interest to date of delivery, if any,
for Series 2016B Bonds bearing interest as follows:
Year Interest Rate
Year Interest Rate
2017
2.000% 2021 2.000%
2018
2.000 2022 2.000
2019
2.000 2023 2.000
2020
2.000
2.02. Purchase Contract. The actions of the President and the Executive Director to execute a
contract with the Purchaser on behalf of the Authority are hereby ratified and approved.
2.02. Terms and Principal Amounts of the Series 2016B Bonds. The Authority will forthwith
issue and sell the Series 2016B Bonds in the total principal amount of $2,565,000, originally dated
January 7, 2016, in the denomination of $5,000 each or any integral multiple thereof, numbered No. R -1,
upward, bearing interest as above set forth, and maturing serially on February 1, in the years and
amounts as follows:
Year Amount
Year Amount
2017
$340,000 2021 $370,000
2018
350,000 2022 385,000
2019
360,000 2023 390,000
2020
370,000
2.03. Redemption.
(a) Optional Redemption. The Series 2016B Bonds are not subject to optional
redemption prior to maturity.
(b) Extraordinary Redemption. The Series 2016B Bonds are subject to extraordinary
redemption, at the option of the Authority, on any business day, in whole or in part, at a
redemption price equal to par plus accrued interest to the redemption date, upon the
happening of certain events of damage to or destruction or condemnation of the Site or the
Police Facilities or change of law rendering the Lease unenforceable or impossible of
performance, as more fully described in the Indenture and the Lease.
2.04. Execution, Authentication and Delivery. The Series 2016B Bonds, substantially in the
form provided in the Indenture, will be prepared under the direction of the Authority staff and executed
on behalf of the Authority by the signatures of the President and the Executive Director, provided that
all signatures may be printed, engraved or lithographed facsimiles of the originals. Notwithstanding
Error! Unknown document property name. 5
such execution, a Series 2016B Bond will not be valid or obligatory for any purpose or entitled to any
security or benefit under this resolution or the Indenture unless and until a certificate of authentication
on the Series 2016B Bond has been duly executed by the manual signature of an authorized
representative of the Trustee. When the Series 20168 Bonds have been so prepared, executed and
authenticated, the Authority will deliver the same to The Depository Trust Company, New York, New
York, on behalf of the Purchaser, upon payment of the purchase price, and the Purchaser is not
obligated to see to the application of the purchase price.
Section 3. Approval and Execution of Documents. The Third Amendment to Ground Lease,
the Third Amendment to Lease, the Third Supplemental Indenture, and the Third Supplemental
Assignment are hereby approved. The President and the Executive Director are authorized and directed
to execute and deliver the Third Amendment to Ground Lease, the Third Amendment to Lease, the Third
Supplemental Indenture, and the Third Supplemental Assignment on behalf of the Authority,
substantially in the forms now on file, but with all such changes therein as shall be approved by the
officers executing the same, which approval shall be conclusively evidenced by the execution thereof.
Copies of all of the transaction documents shall be delivered, filed and recorded as provided therein.
The President and the Executive Director are also authorized and directed to execute such other
instruments as may be required to give effect to the transactions herein contemplated.
Section 4. Payment; Security; Pledges and Covenants. The Series 20166 Bonds are payable
solely from the Lease Payments to be made by the City under the Lease and by the District under the
Sublease and from other moneys realized by the Trustee after default or termination of the Lease by the
City as provided therein. No property or funds of the Authority, other than the property pledged
pursuant to the Indenture and assigned to the Trustee pursuant to the Assignment, is pledged to the
payment of the Series 2016B Bonds.
Section 5. Refunding; Findings; Redemption of Series 2007B Bonds.
5.01. Reduction of Debt Service Cost. It is hereby found and determined that based upon
information presently available from the Authority's municipal advisor, the issuance of the Series 2016B
Bonds is necessary and desirable for the reduction of debt service cost to the Authority, the City, and the
District.
5.03. Redemption of Series 2007B Bonds. The Series 2007B Bonds maturing on
February 1, 2017 and thereafter will be redeemed and prepaid on February 15, 2016. The Series 2007B
Bonds will be redeemed and prepaid in accordance with their terms and in accordance with the terms
and conditions set forth in EXHIBIT A attached hereto. The Trustee, as trustee for the Series 2007B
Bonds, is authorized and directed to send a copy of the Notice of Call for Redemption to each registered
holder of the Series 2007B Bonds.
Section 6. Authentication of Transcript; Issuance Costs.
6.01. Authority Proceedings and Records. The officers of the Authority are authorized and
directed to prepare and furnish to the Purchaser and to the attorneys approving the Series 2016B
Bonds, certified copies of proceedings and records of the Authority relating to the Series 2016B Bonds
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
Error? Unknown document property name.
the validity and marketability of the Series 2016B Bonds and such instruments, including any heretofore
furnished, may be deemed representations of the Authority as to the facts stated therein.
6.02. Certification as to Official Statement. The President and the Executive 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 Series 2016B 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.
6.03. Other Certificates. The President and the Executive Director are hereby authorized and
directed to furnish to the Purchaser at the closing such certificates as are required as a condition of sale.
Unless litigation shall have been commenced and be pending questioning the Series 2016B Bonds or the
organization of the Authority or incumbency of its officers, at the closing the President and the
Executive Director shall also execute and deliver to the Purchaser a suitable certificate as to absence of
material litigation, and the Executive Director shall also execute and deliver a certificate as to payment
for and delivery of the Series 2016B Bonds.
Section 7. Tax Covenants.
7.01. Tax - Exempt Bonds. The Authority covenants and agrees with the holders from time to
time of the Series 2016B 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 Series 2016B 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 Series 2016B Bonds.
7.02. Rebate. The Authority will comply with requirements necessary under the Code to
establish and maintain the exclusion from gross income of the interest on the Series 2016B 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 Series 2016B
Bonds.
7.03. Not Private Activity Bonds. The Authority further covenants not to use the proceeds of
the Series 2016B Bonds or to cause or permit them or any of them to be used, in such a manner as to
cause the Series 2016B Bonds to be "private activity bonds" within the meaning of Sections 103 and 141
through 150 of the Code.
7.04. Qualified Tax - Exempt Obligations. In order to qualify the Series 2016B Bonds as
"qualified tax - exempt obligations" within the meaning of Section 265(b)(3) of the Code, the Authority
makes the following factual statements and representations:
(a) the Series 2016B Bonds are not "private activity bonds" as defined in
Section 141 of the Code;
Error! Unknown document property name. 7
(b) the Authority hereby designates the Series 2016B Bonds as "qualified
tax - exempt obligations" for purposes of Section 265(b)(3) of the Code;
(c) the reasonably anticipated amount of tax - exempt obligations (other than any
private activity bonds that are not qualified 501(c)(3) bonds) which will be issued by the
Authority (and all subordinate entities of the City) during calendar year 2016 will not exceed
$10,000,000; and
(d) not more than $10,000,000 of obligations issued by the Authority during
calendar year 2016 have been designated for purposes of Section 265(b)(3) of the Code.
7.05. Procedural Requirements. The Authority 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.
Error? Unknown document property name. 8
Approved by the Board of Commissioners of the Shorewood Economic Development Authority
this 14th day of December, 2015.
President
ATTEST:
Secretary
Error! Unknown document property name.
EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
$4,285,000
SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY
PUBLIC SAFETY POLICE FACILITY LEASE REVENUE
CROSSOVER REFUNDING BONDS
SERIES 2007B
(CITY OF SHOREWOOD, MINNESOTA LEASE OBLIGATION)
NOTICE IS HEREBY GIVEN that, by order of the Board of Commissioners of the Shorewood
Economic Development Authority (the "Authority "), there have been called for redemption and
prepayment on
February 15, 2016
all outstanding bonds of the Authority designated as the Public Safety Police Facility Lease Revenue
Crossover Refunding Bonds, Series 2007B (City of Shorewood, Minnesota Lease Obligation) (the
"Bonds "), dated as of January 1, 2007, having stated maturity dates of February 1 in the years 2017
through 2023, both inclusive, totaling $2,485,000 in principal amount, and with the following CUSIP
numbers:
Year of Maturity
Amount
CUSIP
2017
$315,000
82522R BA4
2018
325,000
82522R BB2
2019
340,000
82522R BCO
2020
355,000
82522R BD8
2022
750,000
82522R BF3
2023
400,000
82522R BG1
The Bonds are being called at a price of par plus accrued interest to February 15, 2016, on which
date all interest on said Bonds will cease to accrue. Holders of the Bonds hereby called for redemption
are requested to present their Bonds for payment at the main office of the Trustee in the City of Saint
Paul, Minnesota, at the following address, on or before February 15, 2016:
If by mail:
U.S. Bank National Association
Corporate Trust Operations, 3rd Floor
P.O. Box 64111
St. Paul, MN 55164 -0111
Error! Unknown document property name.
Ifs hand or overnight:
U.S. Bank National Association
60 Livingston Avenue
EP- MN -WS3C
Bond Drop Window, 1St Floor
St. Paul, MN 55107
Important Notice: In compliance with the Economic Growth and Tax Relief Reconciliation Act of
2009, the Trustee is required to withhold a specified percentage of the principal amount of the
redemption price payable to the holder of any Bonds subject to redemption and prepayment on the
redemption date, unless the Trustee is provided with the Social Security Number or Federal Employer
Identification Number of the holder, properly certified. Submission of a fully executed Request for
Taxpayer Identification Number and Certification, Form W -9 (Rev. December 2011), will satisfy the
requirements of this paragraph.
7ME I
BY ORDER OF THE BOARD OF COMMISSIONERS
OF THE SHOREWOOD ECONOMIC
DEVELOPMENT AUTHORITY
By /s/ Bill Joyner
Executive Director
Shorewood Economic Development
Authority
Error! Unknown document property name. 2
SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.
RESOLUTION RATIFYING THE SALE OF PUBLIC SAFETY FIRE FACILITY
LEASE REVENUE REFUNDING BONDS, SERIES 2016C (CITY OF
DEEPHAVEN, MINNESOTA LEASE OBLIGATION); AND PROVIDING FOR
THE REDEMPTION OF BONDS REFUNDED THEREBY
BE IT RESOLVED By the Board of Commissioners (the "Board ") of the Shorewood Economic
Development Authority (the "Authority ") as follows:
Section 1. Background; Authorization.
(a) The City of Deephaven, Minnesota (the "City ") is authorized by Minnesota
Statutes, Section 465.71, as amended, to acquire real and personal property under lease -
purchase agreements.
(b) The Excelsior Fire District (the "District ") leases certain property from the City
pursuant to the Ground Lease (East Side), dated as of September 1, 2002 (the "Original Ground
Lease "), as amended by a First Amendment to Ground Lease (East Side), dated as of
January 1, 2007 (the "First Amendment to Ground Lease "). The Authority has agreed with the
District that pursuant to the Subground Lease (East Side), dated as of September 1, 2002 (the
"Original Subground Lease "), as amended by a First amendment to Subground Lease (East Side),
dated as of January 1, 2007 (the "First Amendment to Subground Lease "), the Authority will
acquire certain property from the District. The Authority will lease such property, together with
certain buildings, structures or improvements now or hereafter located thereon (the "Fire
Facilities "), to the City pursuant to a Lease Purchase Agreement (East Side), dated as of
September 1, 2002 (the "Original Lease "), as amended by a First Amendment to Lease Purchase
Agreement (East Side), dated as January 1, 2007 (the "First Amendment to Lease ").
(c) With the Authority's consent, the City has entered into a Sublease Purchase
Agreement (East Side), dated as of September 1, 2002 (the "Sublease "), with the District,
pursuant to which the District undertakes the City's obligations under the Lease (hereinafter
defined).
(d) Pursuant to a Trust Indenture, dated as of September 1, 2002 (the "Original
Indenture "), between the Authority and U.S. Bank National Association, as trustee (the
"Trustee "), as supplemented by a First Supplemental Trust Indenture, dated as of January 1,
2007 (the "First Supplemental Indenture "), the Authority issued its Public Safety Fire Facility
Lease Crossover Refunding Revenue Bonds, Series 2007C (City of Deephaven, Minnesota Lease
Obligation) (the "Series 2007C Bonds "), in the original aggregate principal amount of
$1,585,000. Proceeds of the Series 2007C Bonds were used to achieve the advance crossover
refunding of the Authority's Public Safety Fire Facility Lease Revenue Bonds, Series 2002C (City
of Deephaven, Minnesota Lease Obligation) (the "Series 2002C Bonds "), issued in the original
aggregate principal amount of $2,060,000. Proceeds of the Series 2002C Bonds financed a
portion of the cost of the acquisition, construction, and equipping of the Fire Facilities.
Error! Unknown document property name. 3
(e) The Authority has determined to redeem and prepay the outstanding
Series 2007C Bonds through the issuance of its Public Safety Fire Facility Lease Revenue
Refunding Bonds, Series 2016C (City of Deephaven, Minnesota Lease Obligation) (the
"Series 2016C Bonds "), in the original aggregate principal amount of $875,000.
(f) The Series 2016C Bonds will be issued under the terms of a Second
Supplemental Trust Indenture, dated as of January 1, 2016 (the "Second Supplemental
Indenture," and collectively with the Original Indenture and the First Supplemental Indenture,
the "Indenture "), between the Authority and the Trustee, as Additional Bonds pursuant to the
Indenture.
(g) In connection with the issuance of the Series 2016C Bonds, the Authority will
(i) enter into a Second Amendment to Subground Lease (East Side), dated as of January 1, 2016
(the "Second Amendment to Subground Lease," and collectively with the Original Subground
Lease and the First Amendment to Subground Lease, the "Subground Lease "), with the District;
and (ii) enter into a Second Amendment to Lease Purchase Agreement (East Side), dated as of
January 1, 2016 (the "Second Amendment to Lease," and collectively with the Original Lease and
the First Amendment to Lease, the "Lease "), with the City.
(h) Pursuant to an Assignment and Security Agreement, dated as of
September 1, 2002 (the "Original Assignment "), between the Authority and the Trustee, as
modified by a First Supplemental Assignment and Security Agreement, dated as of
January 1, 2007 (the "First Supplemental Assignment "), and a Second Supplemental Assignment
and Security Agreement, dated as of January 1, 2016 (the "Second Supplemental Assignment,"
and collectively with the Original Assignment and the First Supplemental Assignment, the
"Assignment "), the Authority will assign to the Trustee all of the Authority's right, title and
interest in and to the Subground Lease Lease, the Lease, and the Lease Payments to be made by
the City under the Lease (the "Lease Payments "), other than certain rights to indemnification
and payment of expenses, as security for the Series 2016C Bonds.
(i) Forms of the Second Amendment to Subground Lease, the Second Amendment to
Lease, the Third Supplemental Indenture, and the 'third Supplemental Assignment have been
prepared and submitted to the Authority and are on file with the Authority.
0) On October 26, 2015, the Board authorized Authority staff and consultants to
negotiate the sale of the Series 20160 Bonds, subject to ratification by the Board.
Section 2. Sale of Series 2016C Bonds.
2.01. Award to the Purchaser and Interest Rates. The proposal of Northland Securities, Inc.,
Minneapolis, Minnesota (the "Purchaser "), to purchase the Series 2016C Bonds is hereby found and
determined to be a reasonable offer, and the Board hereby ratifies the actions of Authority staff and
consultants in accepting the Purchaser's proposal, said proposal being to purchase the Series 2016C
Bonds at a price of $882,618.55 (par amount of $875,000.00, plus original issue premium of $15,406.05,
less underwriter's discount of $7,787.50), plus accrued interest to date of delivery, if any, for
Series 2016C Bonds bearing interest as follows:
Error! Unknown document property name. 4
Year
Interest Rate
Year Interest Rate
2017 2.000% 2020 2.000%
2018 2.000 2021 2.000
2019 2.000 2022 2.000
2.02. Purchase Contract. The actions of the President and the Executive Director to execute a
contract with the Purchaser on behalf of the Authority are hereby ratified and approved.
2.02. Terms and Principal Amounts of the Series 2016C Bonds. The Authority will forthwith
issue and sell the Series 2016C Bonds in the total principal amount of $875,000, originally dated
January 7, 2016, in the denomination of $5,000 each or any integral multiple thereof, numbered No. R -1,
upward, bearing interest as above set forth, and maturing serially on February 1, in the years and
amounts as follows:
Year Amount
Year Amount
2017
$140,000
2020
$145,000
2018
140,000
2021
150,000
2019
145,000
2022
155,000
2.03. Redemption.
(a) Optional Redemption. The Series 2016C Bonds are not subject to optional
redemption prior to maturity.
(b) Extraordinary Redemption. The Series 2016C Bonds are subject to extraordinary
redemption, at the option of the Authority, on any business day, in whole or in part, at a
redemption price equal to par plus accrued interest to the redemption date, upon the
happening of certain events of damage to or destruction or condemnation of the Site or the Fire
Facilities or change of law rendering the Lease unenforceable or impossible of performance, as
more fully described in the Indenture and the Lease.
2.04. Execution, Authentication and Delivery. The Series 2016C Bonds, substantially in the
form provided in the Indenture, will be prepared under the direction of the Authority staff and executed
on behalf of the Authority by the signatures of the President and the Executive Director, provided that
all signatures may be printed, engraved or lithographed facsimiles of the originals. Notwithstanding
such execution, a Series 2016C Bond will not be valid or obligatory for any purpose or entitled to any
security or benefit under this resolution or the Indenture unless and until a certificate of authentication
on the Series 2016C Bond has been duly executed by the manual signature of an authorized
representative of the Trustee. When the Series 2016C Bonds have been so prepared, executed and
authenticated, the Authority will deliver the same to The Depository Trust Company, New York, New
York, on behalf of the Purchaser, upon payment of the purchase price, and the Purchaser is not
obligated to see to the application of the purchase price.
Section 3. Approval and Execution of Documents. The Second Amendment to Subground
Lease, the Second Amendment to Lease, the Second Supplemental Indenture, and the Second
Error! Unknown document property name. 5
Supplemental Assignment are hereby approved. The President and the Executive Director are
authorized and directed to execute and deliver the Second Amendment to Subground Lease, the Second
Amendment to Lease, the Second Supplemental Indenture, and the Second Supplemental Assignment
on behalf of the Authority, substantially in the forms now on file, but with all such changes therein as
shall be approved by the officers executing the same, which approval shall be conclusively evidenced by
the execution thereof. Copies of all of the transaction documents shall be delivered, filed and recorded
as provided therein. The President and the Executive Director are also authorized and directed to
execute such other instruments as may be required to give effect to the transactions herein
contemplated.
Section 4. Payment; Security; Pledges and Covenants. The Series 2016C Bonds are payable
solely from the Lease Payments to be made by the City under the Lease and by the District under the
Sublease and from other moneys realized by the Trustee after default or termination of the Lease by the
City as provided therein. No property or funds of the Authority, other than the property pledged
pursuant to the Indenture and assigned to the Trustee pursuant to the Assignment, is pledged to the
payment of the Series 2016C Bonds.
Section 5. Refunding; Findings; Redemption of Series 2007C Bonds.
5.01. Reduction of Debt Service Cost. It is hereby found and determined that based upon
information presently available from the Authority's municipal advisor, the issuance of the Series 2016C
Bonds is necessary and desirable for the reduction of debt service cost to the Authority, the City, and the
District.
5.03. Redemption of Series 2007C Bonds. The Series 2007C Bonds maturing on
February 1, 2017 and thereafter will be redeemed and prepaid on February 15, 2016. The Series 2007C
Bonds will be redeemed and prepaid in accordance with their terms and in accordance with the terms
and conditions set forth in EXHIBIT A attached hereto. The Trustee, as trustee for the Series 2007C
Bonds, is authorized and directed to send a copy of the Notice of Call for Redemption to each registered
holder of the Series 2007C Bonds.
Section 6. Authentication of Transcript; Issuance Costs.
6.01. Authority Proceedings and Records. The officers of the Authority are authorized and
directed to prepare and furnish to the Purchaser and to the attorneys approving the Series 2016C
Bonds, certified copies of proceedings and records of the Authority relating to the Series 2016C Bonds
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 Series 2016C Bonds and such instruments, including any heretofore
furnished, may be deemed representations of the Authority as to the facts stated therein.
6.02. Certification as to Official Statement. The President and the Executive 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 Series 2016C 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.
Error? Unknown document property name.
6.03. Other Certificates. The President and the Executive Director are hereby authorized and
directed to furnish to the Purchaser at the closing such certificates as are required as a condition of sale.
Unless litigation shall have been commenced and be pending questioning the Series 2016C Bonds or the
organization of the Authority or incumbency of its officers, at the closing the President and the
Executive Director shall also execute and deliver to the Purchaser a suitable certificate as to absence of
material litigation, and the Executive Director shall also execute and deliver a certificate as to payment
for and delivery of the Series 2016C Bonds.
Section 7. Tax Covenants.
7.01. Tax - Exempt Bonds. The Authority covenants and agrees with the holders from time to
time of the Series 2016C 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 Series 2016C 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 Series 2016C Bonds.
7.02. Rebate. The Authority will comply with requirements necessary under the Code to
establish and maintain the exclusion From gross income of the interest on the Series 2016C 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 Series 2016C
Bonds.
7.03. Not Private Activity Bonds. The Authority further covenants not to use the proceeds of
the Series 2016C Bonds or to cause or permit them or any of them to be used, in such a manner as to
cause the Series 2016C Bonds to be "private activity bonds" within the meaning of Sections 103 and 141
through 150 of the Code.
7.04. Qualified Tax - Exempt Obligations. In order to qualify the Series 2016C Bonds as
"qualified tax - exempt obligations" within the meaning of Section 265(b)(3) of the Code, the Authority
makes the following factual statements and representations:
(a) the Series 2016C Bonds are not "private activity bonds" as defined in
Section 141 of the Code;
(b) the Authority hereby designates the Series 20160 Bonds as "qualified
tax - exempt obligations" for purposes of Section 265(b)(3) of the Code;
(c) the reasonably anticipated amount of tax - exempt obligations (other than any
private activity bonds that are not qualified 501(c)(3) bonds) which will be issued by the
Authority (and all subordinate entities of the City) during calendar year 2016 will not exceed
$10,000,000; and
(d) not more than $10,000,000 of obligations issued by the Authority during
calendar year 2016 have been designated for purposes of Section 265(b)(3) of the Code.
Error! Unknown document property name. 7
7.05. Procedural Requirements. The Authority 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.
Error! Unknown document property name.
Approved by the Board of Commissioners of the Shorewood Economic Development Authority
this 14`" day of December, 2015.
President
ATTEST:
Secretary
Error! Unknown document property name.
City of Shorewood Economic Development Authority
EXHIBIT A
$1,585,000
SHOREWOOD ECONOMIC DEVELOPMENT AUTHORITY
PUBLIC SAFETY FIRE FACILITY LEASE REVENUE
CROSSOVER REFUNDING BONDS
SERIES 2007C
(CITY OF DEEPHAVEN, MINNESOTA LEASE OBLIGATION)
NOTICE IS HEREBY GIVEN that, by order of the Board of Commissioners of the Shorewood
Economic Development Authority (the "Authority "), there have been called for redemption and
prepayment on
February 15, 2016
all outstanding bonds of the Authority designated as the Public Safety Fire Facility Lease Revenue
Crossover Refunding Bonds, Series 2007C (City of Deephaven, Minnesota Lease Obligation) (the
"Bonds "), dated as of January 1, 2007, having stated maturity dates of February 1 in the years 2017
through 2022, both inclusive, totaling $830,000 in principal amount, and with the following CUSIP
numbers:
Year of Maturity
Amount
CUSIP
2017
$125,000
825228 DX4
2018
130,000
825228 DY2
2019
135,000
825228 DZ9
2020
140,000
825228 EA3
2021
145,000
825228 EB1
2022
155,000
825228 EC9
The Bonds are being called at a price of par plus accrued interest to February 15, 2016, on which
date all interest on said Bonds will cease to accrue. Holders of the Bonds hereby called for redemption
are requested to present their Bonds for payment at the main office of the Trustee in the City of Saint
Paul, Minnesota, at the following address, on or before February 15, 2016:
If by mail:
U.S. Bank National Association
Corporate Trust Operations, 3rd Floor
P.O. Box 64111
St. Paul, MN 55164 -0111
If by hand or overnight:
U.S. Bank National Association
60 Livingston Avenue
EP -M N -WS3C
Bond Drop Window, 15t Floor
St. Paul, MN 55107
Important Notice: In compliance with the Economic Growth and Tax Relief Reconciliation Act of
2009, the Trustee is required to withhold a specified percentage of the principal amount of the
redemption price payable to the holder of any Bonds subject to redemption and prepayment on the
redemption date, unless the Trustee is provided with the Social Security Number or Federal Employer
Identification Number of the holder, properly certified. Submission of a fully executed Request for
Taxpayer Identification Number and Certification, Form W -9 (Rev. December 2011), will satisfy the
requirements of this paragraph.
Dated:
BY ORDER OF THE BOARD OF COMMISSIONERS
OF THE SHOREWOOD ECONOMIC
DEVELOPMENT AUTHORITY
By /s/ Bill Joynes
Executive Director
Shorewood Economic Development
Authority
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