96-094
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Extract of Minutes of Meeting
of the City Council of the City of
Shorewood, Hennepin County, Minnesota
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City
of Shorewood, Minnesota, was duly held in the City Hall in said City on Monday, October 28,
1996, commencing at 7:30 o'clock P.M.
The following members were present:
Mayor Bean, Councilmembers Stover, Benson, McCarty and Shaw
and the following were absent:
None
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* * *
The Mayor announced that the next order of business was consideration of the proposals
which had been received for the purchase of the City's $860,000 General Obligation Water
Revenue Bonds, Series 1996A.
The City Administrator/Clerk presented a tabulation of the proposals which had been
received in the manner specified in the Terms of Proposal for the Bonds. The proposals were
as follows:
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After due consideration of the proposals, Member
Shaw
then introduced
the following resolution and moved its adoption:
RESOLUTION NO. 96-94
A RESOLUTION A WARDING THE SALE OF $860,000 GENERAL
OBLIGATION WATER REVENUE BONDS,
SERIES 1996A; FIXING THEIR FORM AND SPECIFICA TrONS;
DIRECTING THEIR EXECUTION AND DELIVERY;
AND PROVIDING FOR THEIR PAYMENT
BE IT RESOLVED By the City Council of the City of Shorewood, Hennepin County,
Minnesota (City) as follows:
Section 1.
Sale of Bonds.
1.01. The proposal of Juran & Moody, rnc. (purchaser) to
purchase $860,000 General Obligation Water Revenue Bonds, Series 1996A (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 $ 849,293 plus accrued
interest to date of delivery, for Bonds bearing interest as follows:
Year of Interest Year of Interest
Maturitv Rate Maturitv Rate
1998 4.00 % 2006 4.95 %
1999 4.20 2007 5.00
2000 4.35 2008 5.10
2001 4.45 2009 5.20
2002 4.55 2010 5.25
2003 4.65 2011 5.30
2004 4~75 2012 5.40
2005 4.85
True interest cost: 5.1793 %
1.02. The sum of $ 473 . 00 being the amount proposed by the Purchaser in excess
of $848,820 will be credited to the Debt Service Fund hereinafter created. The City
Administrator/Clerk is directed to deposit 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
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proposers forthwith. The Mayor and City Administrator/Clerk are directed to execute a contract
. with the Purchaser on behalf of the City.
1.03. The City will forthwith issue and sell the Bonds pursuant to Minnesota Statutes,
Section 444.075 (Act), in the total principal amount of $860,000, originally dated November 1,
1996, 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 1 in the years and
amounts as follows:
Year Amount Year Amount
1998 $55,000 2006 $60,000
1999 55,000 2007 55,000
2000 60,000 2008 60,000
2001 55,000 2009 55,000
2002 60,000 2010 60,000
2003 55,000 2011 55,000
2004 60,000 2012 60,000
2005 55,000
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1.04. Ootional Redemption. The City may elect on February 1, 2006, and on any day
thereafter to prepay Bonds due on or after February 1, 2007. 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 the 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 the Bond will be dated as of the date of original issue. The interest
on the Bonds will be payable on August 1 and February 1 of each year, commencing August 1,
1997, to the registered owners of record thereof as of the close of business on the fifteenth day
of the immediately preceding month, whether or not that day is a business day.
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2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating
agent and paying agent (Registrar). The effect of registration and the rights and duties of the
City and the Registrar with respect thereto are as follows:
(a) Register. The Registrar must keep at its principal corporate trust office a
bond register in which the Registrar provides for the registration of ownership of Bonds
and the registration of transfers and exchanges of Bonds entitled to be registered,
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
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for any tax, fee or other governmental charge required to be paid with respect to the
transfer or exchange.
(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
of the mutilated Bond or in lieu of and in substitution for a Bond destroyed, stolen or lost,
upon the payment of the reasonable expenses and charges of the Registrar in 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 of 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.
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(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 registered owners, 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
FirStar Bank of Minnesota, N .A. St Paul , Minnesota, as the initial
Registrar. The Mayor and the City Administrator/Clerk 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 Finance Director must transmit to the
Registrar moneys sufficient for the payment of all principal and interest then due.
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2.05. Execution. Authentication and Delivery. The Bonds will be prepared under the
direction of the Administrator/Clerk and executed on behalf of the City by the signatures of the
Mayor and the Administrator/Clerk, provided that all signatures may be printed, engraved or
lithographed facsimiles of the originals. If an officer whose signature or a facsimile of whose
signature appears on the Bonds ceases to be such officer before the delivery of any Bond, that
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 certificate 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
Administrator/Clerk 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:
[Face of the Bond]
No. R-
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF SHOREWOOD
$
GENERAL OBLIGATION WATER REVENUE
BOND, SERIES 1996A
Rate
Date of
Original Issue
Maturity
CUSIP
November 1, 1996
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. Registered Owner: Cede & Co.
The City of Shorewood, 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 August 1 and February 1 in each year,
commencing August 1, 1997, 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
, Minnesota, 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.
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The City may elect on February 1, 2006, and on any day thereafter to prepay Bonds due
on or after February 1,2007. 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 The Depository 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 issue of Bonds of which this Bond forms a part as
"qualified tax exempt obligations" within the meaning of Section 265(b)(3) of the Internal
Revenue Code of 1986, 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.
Additional provisions of this Bond contained on the reverse hereof have the same effect
as though fully set forth in this place.
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 Shorewood, Hennepin County, Minnesota, by its
City Council, has caused this Bond to be executed on its behalf by the facsimile or manual
signatures of the Mayor and City Administrator/Clerk and has caused this Bond to be dated as
of the date set forth below.
Dated:
CITY OF SHOREWOOD, MINNESOTA
(F acsimi Ie)
City Administrator/Clerk
(Facsimile)
Mayor
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
By
. Authorized Representative
[Reverse of the Bond]
This Bond is one of an issue in the aggregate principal amount of $860,000 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 October 28, 1996
(the Resolution), for the purpose of providing money to aid in financing various improvements
to the water system of the City, pursuant to and in full conformity with 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 from the net revenues of the water system
of the City and from Special Assessments levied against property specially benefitted by system
improvements 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 irrevocably 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 and Special Assessments pledged, which taxes may be levied without
limitation as to rate or amount. The Bonds of this series are issued only as fully registered Bonds
in denominations of $5,000 or any integral multiple thereof of single maturities.
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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 water plant 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 Water Fund, into which it will pay
all of the gross revenues from the water system; that it will also create and maintain a General
Obligation Water Revenue Bonds, Series 1996A Debt Service Fund, into which it will pay, out
of the net revenues from the water system and Special Assessments 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 water system revenues and Special Assessments.
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 oyerdue or not, for the purpose
of receiving payment and for all other purposes, and neither the City nor the Bond Registrar will
be affected by any notice to the contrary.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the Constitution and laws of the State of Minnesota 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 or statutory
limitation of indebtedness.
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:
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TEN COM -- as tenants
m common
UNIF GIFT MIN ACT Custodian
(Cust) (Minor)
TEN ENT -- as tenants
by entireties
under Uniform Gifts or
Transfers to Minors
IT TEN --
as joint tenants with
right of survivorship and
not as tenants in common
(State)
Act. . . .
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
F or value received, the undersigned hereby sells, assigns and transfers unto
the with!n 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:
Signature(s) must be guaranteed by a [member of the Medallion Signature Program.] [national
bank or trust compariy or by a brokerage firm having a membership in one of the major stock
exchanges. ]
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 joint 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 RelZistration
Signature of
Officer of the Registrar
Registered Owner
Cede & Co.
Federal ID #13-2555119
3.02. The City Administrator/Clerk 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. (a) The City will create and continue to operate its Water Fund to which will
be credited all gross revenues of the water system and out of which will be paid all
normal and reasonable expenses of current operations of the water system. Any balance
therein are deemed net revenues and will be transferred, from time to time, to a General
Obligation Water Revenue Bonds, Series 1996A Debt Service Fund (Debt Service Fund)
hereby created in the Water Fund, which fund will be used only to 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 interest on
all the Bonds described in the resolution authorizing the sale of the Bonds, and the
Administrator/Clerk must report any current or anticipated deficiency in the Debt Service
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Fund to the City Council. There is appropriated to the Debt Service Fund (i) capitalized
interest financed from Bond proceeds, if any, (ii) any amount over the minimum purchase
price of the Bonds paid by the Purchaser, and (iii) the accrued interest paid by the
Purchaser upon closing and delivery of the Bonds.
(b) The proceeds of the Bonds, less the appropriations made in paragraph (a),
together with any other funds appropriated during the construction of the Projects financed
by the Bonds (as identified in Resolution No. 96-86) (Projects) will be deposited in a
separate construction fund to be used solely to defray expenses of the Projects and the
payment of principal and interest on the Bonds prior to the completion and payment of
all costs of the Projects. When the Projects are completed and the cost thereof paid, the
construction account is to be closed and any balance therein is to be deposited in the Debt
Service Fund.
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 unpaid, it will keep and enforce the following
covenants and agreements:
(a) The City will continue to maintain and efficiently operate the water 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 water
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 Water Fund and will cause money to be credited thereto from time to time, out of
net revenues from the water plant and system and Special Assessments 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 water system and which will be open to
inspection and copying by any bondholder, or the bondholder'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 water 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 water system to be
deposited in a bank whose deposits are guaranteed under the Federal Deposit Insurance
Law.
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(e) The Council will keep the water 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 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.
(t) The City and each and all of its officers will punctually perform all duties
with reference to the water 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,
together with any Special Assessments designated as a source of payment of the Bonds,
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.
(i) The City has levied or will levy special assessments (Assessments) against
property specially benefitted by the construction of system improvements in accordance
with the procedures of Minnesota Statutes, Chapter 429 payable in such installments as
the City Council has determined by resolution, and all payments of the Assessments will
be credited to the Debt Service Fund for payment of prior principal and interest on the
Bonds together with net system revenues herein pledged for payment of the Bonds.
4.03. It is hereby determined that the estimated collection of net revenues and
Assessments 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 Administrator/Clerk is authorized and directed to file a certified copy of
this resolution with the Taxpayer Services Division Manager 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 furnish 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.
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5.02. The Mayor and City Administrator/Clerk 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.
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 1996}exceed the small-issuer exception amount
of $5,000,000.
(b) F or 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 $5,000,000, all within the meaning of Section
148( O( 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 150 of the Code.
6.04. In order to qualify the Bonds as "qualified tax-exempt obligations" within the
meaning of Section 265(b)(3) of the Code, the City makes the following factual statements and
representations:
(a) . the Bonds are not "private activity bonds" as defined in Section 141 of the
Code;
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(b) the City designates the 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
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 1996 will not exceed
$10,000,000; and
(d) not more than $10,000,000 of obligations issued by the City during
calendar year 1996 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 of DTC.
.
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 Bond, 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
Administrator/Clerk of a written notice to the effect that DTC has determined to substitute a new
nominee in place of Cede & Co., the words "Cede & Co.," will refer to such new nominee of
DTC; and upon receipt of such a notice, the Administrator/Clerk will promptly deliver a copy
of the same to the Bond Registrar and Paying Agent.
7.03. Representation Letter. The form of Blanket Issuer Letter of Representations
proposed to be submitted to DTC, which is on file with the Administrator/Clerk and presented
to this meeting (Representation Letter), is hereby approved, and the Administrator/Clerk is
authorized to execute and deliver the Representation Letter in substantially the form on file, with
such changes therein not inconsistent with law as the Administrator/Clerk and the City Attorney
may approve, which approval will be conclusively evidenced by the execution thereof. Any
Paying Agent or Bond Registrar subsequently appointed by the City with respect to the Bonds
will agree to take all action necessary for all representations of the City in the Representation
letter with respect to the Bond Registrar and Paying Agent, respectively, to be complied with at
all times.
7.04. Transfers Outside Book-Entry System. In the event the City, by resolution of the
City Council, determines that it is in the best interests of the persons having beneficial interests
in the Bonds that they be able to obtain Bond certificate, ,the City will notify DTe, wll.er~upon _
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 owner 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 ofDTC,
payments with respect to principal of, premium, if any, and interest on the Bond and all 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. Participating underwriters need not comply with the continuing disclosure
requirements of Rule 15c2-12 promulgated by the Securities and Exchange Commission under
the Securities Exchange Act of 1934 (the "Rule"), because the offering is in a principal amount
less than $1,000,000. Consequently, the City will not enter into any undertaking to provide
continuing disclosure of any kind with respect to the Bonds.
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The motion for the adoption of the foregoing resolution was duly seconded by Member
McCarty
, and upon vote being taken thereon, the following voted in favor
thereof:
Mayor Bean, Councilmembers Stover, Benson, McCarty and Shaw
and the following voted against the same:
None
whereupon said resolution was declared duly passed and adopted.
"1
t,/. r. . . ..., ~ ." ..::-:' .'-\
;'-_''-'Iil.lL'-\\ .~ '\ -~.t(:,.A/"--
Robert B. Bean, Mayor
ATTEST:
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STATE OF MINNESOTA )
)
COUNTY OF HENNEPIN ) SS.
)
CITY OF SHORE WOOD )
I, the undersigned, being the duly qualified and acting Administrator/Clerk of the City of
Shorewood, Hennepin County, Minnesota, do hereby certify that I have carefully compared the
attached and foregoing extract of minutes of a regular meeting of the City Council of the City
held on October 28, 1996 with the original minutes on file in my office and the extract is a full,
true and correct copy of the minutes insofar as they relate to the issuance and sale of $860,000
General Obligation Water Revenue Bonds, Series 1996A of the City.
WITNESS My hand officially as such Administrator/Clerk and the corporate seal of the
. City this --2.;( day of /) ~h ku. y , 1996.
L
dministrator/Clerk
wood, Minnesota
(SEAL)
.
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