RES 1986-63 - 00004868112
RESOLUTION NO. 63 - 1986
RESOLUTION AWARDING THE SALE OF $2,705,000 GENERAL
OBLIGATION IMPROVEMENT REFUNDING BONDS, SERIES 1986;
FIXING THEIR FORM AND SPECIFICATIONS; DIRECTING THEIR
EXECUTION AND DELIVERY; AND PROVIDING FOR THEIR PAYMENT
BE IT RESOLVED by the City Council of the City of Fridley, Minnesota, as
follows:
1. Definitions As used in this Resolution and in the Escrow Deposit
Agreement, in addition to any terms which may be defined in the text of this
Resolution or in said Agreement, the following terms shall have the following
respective meanings:
"Alternative Crossover Date" means the first day of any month not
later than August 1, 1993, established pursuant to the Escrow
Deposit Agreement as the end of the Alternative Crossover Period.
"Alternative Crossover Period" means any period beginning on the
First Crossover Date or an Alternative Crossover Date and ending on
the next succeeding Alternative Crossover Date.
' "Bank" means the same as that term in defined in the Series 1985
Indenture, being as of the date hereof National Australia Bank
Limited, acting through its New York Branch.
"Bonds" means the City's $2,705,000 General Obligation Improvement
Refunding Bonds, Series 1986, as authorized to be issued pursuant to
this Resolution.
"Crossover Date" means the First Crossover Date or the Alternative
Crossover Date on which, pursuant to this Resolution and the Escrow
Deposit Agreement, the crossover refunding of the Series 1985 Bonds
shall actually occur.
"Debt Service Fund" and "Series 1986 Debt Service Fund" mean the
debt service fund created for the Bonds pursuant to paragraph 13 of
this Resolution.
"Escrow Account" means the account of that name created pursuant to
the Escrow Deposit Agreement,
"Escrow Deposit Agreement" means the Escrow Deposit Agreement
respecting the Bonds, dated as of August 1, 1986, between the City
and First Trust Company, Inc., as Escrow Agent thereunder, and any
permitted amendments thereof or successors thereto.
"First Crossover Date" means February 1, 1990.
"First Crossover Period" means the period beginning on the date of
issuance of the Bonds and ending on the First Crossover Date.
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Page 2 - Resolution No. 63 - 1986
"Interest Account" means the account of that name created in the
Series 1986 debt Service Fund pursuant to this Resolution.
"Principal Account" means the account of that name created in the
Series 1986 Debt Service Fund pursuant to this Resolution.
"Reimbursement Agreement" means the Credit Agreement respecting the
bonds, as defined in the Series 1985 Indenture, being as of the date
hereof that certain Reimbursement Agreement, dated as of December 1,
1985, between the City and the Bank, as amended.
"Resolution" and "Series 1986 Bond Resolution" mean this resolution.
"Series 1985 Bonds" means the City's $3,100,000 Variable Rate Demand
General Obligation Improvement Bonds, Series 1985, dated December
30, 1985, and issued pursuant to the Series 1985 Bond Resolution and
the Series 1985 Indenture.
"Series 1985 Bond Resolution" means Resolution No. 111 -1985, adopted
by the City Council on December 16, 1985, authorizing the issuance
of the Series 1985 Bonds.
"Series 1985 Indenture" means the Trust Indenture respecting the
Bonds, dated as of December 1, 1985, between the City and the First
Trust Company, Inc., as Trustee thereunder, and respecting the
' Series 1985 Bonds.
(The following special assessment definitions have intentionally been placed
in other than alphabetical order)
"Series 1985 Special Assessments" means the same as the term
"Special Assessments," as defined in paragraph 7 (a) of the Series
1985 Bond Resolution and consisting generally of those special
assessments levied or to be levied by the City pursuant to Minnesota
Statutes, Chapter 429, against properties within the City specially
benefited by the making of the Improvements (as defined in the
Series 1985 Bond Resolution) in amounts, but only in such amounts,
necessary to pay the principal of, interest on, and premium, if any,
on the Series 1985 Bonds and in certain circumstances the Purchase
Price thereof.
"Modified Series 1985 Special Assessments" means the Series 1985
Special Assessments, except the portion thereof (the "Excepted
Portion ") which would, but for the issuance of the bonds and the
application of the proceeds thereof under this Resolution and the
Escrow Deposit Agreement, be required by the Series 1985 Bond
Resolution and the Series 1985 Indenture to be deposited in the debt
service account established by the Series 1985 Bond Resolution or
the payment of that portion of the principal of the Series 1985
Bonds which will hereafter be paid from the Escrow Account, whether
upon mandatory sinking fund redemption on or prior to, or upon
optional redemption on, the Crossover Date, said principal of the
Series 1985 Bonds to be paid from the Escrow Account being in the
aggregate $2,635,000; provided, however, that during any period in
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Page 3 - Resolution No. 63 - 1986
' which there are amounts owed and unpaid by the City to the Bank
pursuant to the Reimbursement Agreement, the Excepted Portion
defined hereinabove shall be reduced to the greater of (A) zero or
(B) the difference between. the Excepted Portion (as determined
without reference to this provision) and such owed and unpaid
amounts.
"Pre- Crossover Available Special Assessmentsn means all special
Assessments except the Modified Series 1985 Special Assessments.
"Post- Crossover Available Special Assessments" means the
Pre- Crossover Available Special Assessments plus the Modified Series
1985 Special Assessments.
2. Authorization of Issuance The City has heretofore issued its Series 1985
Bonds for the purpose of financing various assessable public improvement
costs, and the Council hereby determines that it would be in the best interest
of the City, and would be necessary or desirable for the stabilization and /or
reduction of the debt service costs to the City with respect to the Series
1985 Bonds and for the adjustment of the maturities thereof in relation to the
resources available for their payment, to issue the Bonds for the purpose of
crossover refunding the Series 1985 Bonds pursuant to Minnesota Statutes,
Chapter 475, including without limitation, Section 475.67, Subdivision 13.
The Bonds shall be issued for the following purposes:
Approximate Cost of Purchase of
Refunding Obligations under the
Escrow Deposit Agreement $2,635,000
Discount 40,575
Cost of Issuance 29,425
Total $2,705,000
The Council hereby determines that the unspent proceeds of the Series 1985
Bonds are needed and will be applied and expended for the purposes for which
the Series 1985 Bonds were issued.
3. Acceptance of Purchase Offer Pursuant to Minnesota Statutes, Section
475.60, Subdivision 2 (5), the City is authorized to negotiate the sale of the
Bonds without public sale. The offer of Miller & Schroeder Financial, Inc.
(the "Purchaser "), to purchase the Bonds is hereby accepted, such bid being to
purchase the Bonds at a price of $2,664,425 plus accrued interest to date of
delivery, the Bonds to bear interest, to mature in the years and amounts, and
to be subject to such other terms and conditions as hereinafter provided. The
officers of the City are hereby authorized and directed to execute on behalf
of the City the Bond Purchase Agreement presented to the City by the Purchaser
respecting the purchase of the Bonds by the Purchaser.
4. Maturities, Mandatory Sinking Fund Redemptions and Other Terms The City
of Fridley shall forthwith issue and sell the Bonds, which shall be dated
August 1, 1986, shall be fully registered without interest coupons and shall
be numbered R -1 et seq., shall be in the denomination of $5,000 each, or in
integral multiples thereof, shall bear interest as set forth below, all
interest payable February 1, 1987, and semiannually thereafter on February 1
and August 1 in each year, and shall bear interest at the rates per annum and
mature on February 1 in the years and amounts as follows, respectively:
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Page 4 - Resolution No. 63 - 1986
Year
Amount
Rate
1991
$ 615,000
6.008
1996
1,025,000
7.00%
2000
1,065,000
7.4096
All Bonds maturing on February 1, 1991, are subject to mandatory sinking fund
redemption by the City a par plus accrued interest on February 1 in the years
and amounts as follows, respectively:
Year
Amount
1988
$ 140,000
1989
150,000
1990
155,000
All Bonds maturing on February 1, 1996, are subject to mandatory sinking fund
redemption by the City at par plus accrued interest on February 1 in the years
and amounts as follows, respectively:
Year Amount
1992
$ 180,000
1993
195,000
1994
205,000
1995
215,000
All Bonds maturing on February 1, 2000, are subject to mandatory sinking fund
redemption by the City at par plus accrued interest on February 1 in the years
and amounts as follows, respectively:
Year Amount
1997 $ 240,000
1998 260,000
1999 275,000
The specific Bonds, or portions thereof, which shall be mandatorily redeemed
by the City pursuant to the foregoing provisions shall be chosen by $5,000 lot
by the Bond Registrar in the same manner prescribed herein for selecting
Bonds, or portions thereof, to be optionally redeemed.
5. Covenants Respecting Special Assessments The covenants made by the City
with the owners of the Series 1985 Bonds are hereby made as well with the
owners of the Bonds to the same extent and effect as if those covenants were
set forth in full in this Resolution.
6. Optional Redemption All Bonds maturing after February 1, 1994, are
subject to redemption at the option of the City on said date and on any
interest payment date thereafter in inverse order of maturities at par plus
' accrued interest to date of redemption. If not all of the principal amount of
Bonds of the same maturity are called for redemption, (A) the Bond Registrar
(hereinafter defined) shall assign a separate number to each $5,000 multiple
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Page 5 - Resolution No. 63 - 1986
' of each Bond of that maturity, shall select the redemption amount by lot
therefrom, and shall authenticate and deliver to each registered owner of a
Bond partially redeemed thereby a new Bond in the remaining principal amount
not so redeemed, (B) the principal amount of such maturity which is not
subject to mandatory sinking fund redemption shall be reduced to the extent of
the principal amount of such optional redemption, and (C) the mandatory
sinking fund redemption amounts applicable to that maturity shall be reduced
in inverse order of the redemption dates thereof to the extent of the
difference between the total principal amount of such optional redemption of
that maturity and the amount of that maturity which is not subject to
mandatory sinking fund redemption.
7. Bond Registrar Both principal of and interest on the Bonds shall be
payable by First Trust Company, Inc., in the City of St. Paul, Minnesota,
which shall also act as registrar and transfer agent for the Bonds, or by its
duly appointed and qualified successor thereto (such agent or successor herein
referred to as the "Bond Registrar "), and the City shall pay the reasonable
charges of the Bond Registrar for such services.
8.
Form of Bonds
The Bonds shall be in substantially
the following form:
No.
R -_
$
UNITED STATES OF AMERICA
' STATE OF MINNESOTA
COUNTY OF ANOKA
CITY OF FRIDLEY
GENERAL OBLIGATION IMPROVEMENT
REFUNDING BOND, SERIES 1986
RATE OF INTEREST MATURITY DATE DATE OF ISSUE CUSIP
August 1, 1986
REGISTERED
OWNER:
PRINCIPAL
AMOUNT:
The City of Fridley, Anoka County, Minnesota (the "City "), hereby acknowledges
itself to be indebted and, for value received, promises to pay to the
registered owner named above, or registered assigns (the "Registered Owners "),
upon presentation and surrender hereof, the principal amount specified above
' on the maturity date specified above, or on any earlier date on which this
Bond may be and shall have been duly called for prior redemption, and to pay
interest to the Registered Owner from the date hereof on such principal
Page 6 - Resolution No. 63 - 1986
' amount, until paid, at the per annum rate of interest specified above, all
interest payable on February 1 and August 1 of each year, commencing February
1, 1987 (the "Interest Payment Date "). Both principal of and interest on this
Bond are payable by First Trust Company, Inc., in the City of St. Paul,
Minnesota, or by its duly appointed successor as paying, transfer, and
authenticating agent and registrar for the Bonds (the "Bond Registrar ") , in
any coin of currency of the United States of America which on the date of
payment is legal tender for public and private debts. On each Interest
Payment Date the Bond Registrar will pay the interest then due on this Bond by
mailing to the Registered Owner's address a check or draft made payable to the
Registered Owner, as such name and address of the Registered Owner appear on
the registration books of the City maintained for the Bonds by the Bond
Registrar (the "Bond Registrar ") at the end of the 15th day of the month prior
to such Interest Payment Date.
(If provisions of the Bonds are to be printed on the reverse side thereof, the
face of the Bonds shall contain the foregoing provisions, the last two
paragraphs of the Bonds, the signatures of the City officials executing the
Bonds, and the seal of the City (if the same is to be printed on the Bonds),
and the following paragraph shall be inserted on the face of the Bonds
immediately preceding the above - mentioned final two paragraphs:
REFERENCE IS HEREBY MADE TO THE ADDITIONAL PROVISIONS OF THIS BOND WHICH ARE
SET FORTH ON THE REVERSE SIDE HEREOF).
' All Bonds of this issue maturing after February 1, 1994, are subject to
redemption at the option of the City in inverse order of maturities on said
date and on any Interest Payment Date thereafter at a price of par plus
accrued interest to date of redemption. If the City elects to prepay a
principal amount of Bonds which results in not all of the principal amount of
Bonds of the same maturity being called for prepayment, (A) the Bond Registrar
shall assign a separate number to each $5,000 multiple of each Bond of that
maturity, shall select the appropriate prepayment amount by lot therefrom, and
shall authenticate and deliver to each Registered Owner of a Bond partially
prepaid thereby a new Bond in the principal amount not so prepaid, (B) the
principal amount of such maturity which is not subject to mandatory sinking
fund redemption shall be reduced to the extent of the principal amount of such
optional redemption, and (C) the mandatory sinking fund redemption amounts
applicable to the maturity shall be reduced in inverse order of the redemption
dates thereof to the extent of the difference between the total principal
amount of such optional redemption of that maturity and the amount of that
maturity which is not subject to mandatory sinking fund redemption. Notice of
any prior redemption of this Bond shall be given in the manner required by law
and shall be mailed to the Registered Owner no less that 15 days prior to the
date of redemption.
All Bonds maturing on February 1, 1991, are subject to mandatory sinking fund
redemption by the City on February 1 in the years and amounts as follows,
respectively:
Year
1988
1989
1990
Amount
$ 140,000
150,000
155,000
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Page 7 - Resolution No. 63 - 1986
All Bonds maturing on February 1, 1996, are subject to mandatory sinking fund
redemption by the City on February 1 in the years and amounts as follows,
respectively:
Year Amount
1992
$ 180,000
1993
195,000
1994
205,000
1995
215.000
All Bonds maturing on February 1, 2000, are subject to mandatory sinking fund
redemption by the City on February 1 in the years and amounts as follows,
respectively:
Year
Amount
1997
$ 240,000
1998
260,000
1999
275,000
The specific Bonds, or portions thereof, which shall be mandatorily redeemed
by the City pursuant to the foregoing provisions shall be chosen by $5,000 lot
by the Bond Registrar in the same manner prescribed herein for selecting
Bonds, or portions thereof, to the optionally redeemed. All mandatory sinking
fund redemptions of Bonds shall be at par plus accrued interest to the date of
redemption.
This Bond is one of an issue of fully registered Bonds without interest
coupons in the total principal amount of $2,075,000, all of like date and
tenor except as to maturity, interest rate, redemption privilege, and
registration number, all issued by the City for the purpose of providing funds
to crossover refund the City's $3,100,000 Variable Rate Demand General
Obligation Improvement Bonds, Series 1985, December 30, 1985, pursuant to and
in full conformity with the Home Rule Charter of the City (the "Charter ") and
the Constitution and laws of the State of Minnesota, including Minnesota
Statutes, Section 475,67, Subdivision 13. The interest accruing on this Bond
prior to the Crossover Date, as defined in the resolution adopted by the City
Council on August 14, 1986, authorizing the issuance of the Bonds (the "Bond
Resolution "), is payable primarily from earnings on investments of funds held
in the Escrow Account established by the Escrow Deposit Agreement respecting
the Bonds, dated as of August 1, 1986, between the City and First Trust
Company, Inc., as Escrow Agent thereunder, and, to the extent of any
insufficiency of such earnings, such interest, and the principal hereof,
together with the interest accruing hereon from and after the Crossover Date,
are payable from certain special assessments levied or to be levied by the
City against properties within the City specially benefited by the making of
certain public improvements and which assessments have been pledged to the
payment hereof pursuant to and to the extent provided in the Bond Resolution;
but this Bond constitutes a general obligation of the City, and, to provide
moneys for the prompt and full payment of the principal of and interest on all
of the Bonds as the same become due, the full faith and credit and taxing
powers of the City have been and are hereby irrevocably pledged, and the City
f
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Page 8 - Resolution No. 63 - 1986
Council will levy ad valorem taxes, if required for such purpose, which taxes
may be levied on all of the taxable property in the City without limitation as
to rate or amount.
This Bond may be transferred or exchanged, but only upon the Bond Registrar
and only by the Registered Owner or its attorney duly authorized in writing,
upon surrender hereof together with a duly executed written instrument of
transfer satisfactory to the Bond Registrar, whereupon and Bond Registrar
shall authenticate and deliver in the name of the designated transferees a new
registered Bond or Bonds of the same aggregate amount, maturity, rate of
interest, and other terms hereof. Only the Registered Owner shall be entitled
to receive the principal of and interest on this Bond, and the City and the
Bond Registrar may treat the Registered Owner as the absolute owner hereof for
all other purposes whatsoever.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things
required by the Constitution and laws of the State of Minnesota and the
Charter to be done, to have happened, and to be performed precedent to and in
the issuance of this Bond have been done, have happened, and have been
performed in regular and due form, time, and manner as required by law; and
that this Bond, together with all other indebtedness of the City outstanding
on the date hereof and on the date of its actual issuance and delivery, does
not cause the indebtedness of the City to exceed any constitutional,
statutory, or Charter limitation thereon.
' IN WITNESS WHEREOF the City of Fridley, Minnesota, Anoka County, Minnesota, by
its City Council, has caused this Bond to be executed by the manual or
facsimile signatures of its Mayor and City Manager; has caused this Bond to be
executed manually by the Bond Registrar, as the City's duly appointed
authenticating agent for the Bonds; has caused the official seal of the City
to be omitted from this Bond as permitted by law; and has caused this Bond to
be dated August 1, 1986.
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Page 9 - Resolution No. 63 - 1986
City Manager
(OMIT SEAL)
CERTIFICATION OF AUTHENTICATION
Mayor
This Bond is one of the Bonds designated herein and issued pursuant to the
resolution authorizing its issuance and delivery.
Date of
Authentication:
First Trust Company, Inc.
Bond Registrar
By
Its Authorized Signature
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned, hereby sells, assigns, and transfers unto
(Tax Identification or Social Sercurity No.
' ) this Bond and all rights thereunder and hereby irrevocably
constitutes and appoints _ , as attorney of the
undersigned, to transfer this Bond on the Bond Register with full power of
substitution.
Date:
NOTICE: The signature to this
assignment must correspond with the name
as it appears upon the face of this Bond
in every particular, without alteration,
enlargement, or any other change
whatsoever.
Signature Guaranteed:
Signature(s) must be guaranteed by a national bank or trust company or by a
brokerage firm which is a member of a major stock exchange.
The Bond Registrar will not transfer this Bond unless the following
information on the transferree is provided (including such information on all
' joint owners if the Bond(s) are to be held by joint account):
Name and Address:
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Page 10 - Resolution No. 63 - 1986 12 1
The following abbreviations, when used in the inscription on the face of this
Bond, shall be construed as though they were written out in full according to
applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the
entireties
JT TEN - as joint tenants with
right of survivorship
and not as tenants in
common
UNIF GIFT MIN ACT -
Custodian
(Cust) (Minor)
under Uniform Gifts to Minors
Act of
(State)
Additional abbreviations may also be used though not in the above list.
(End of Bond Form)
9. Bond Counsel Opinion The City Clerk shall obtain a copy of the proposed
approving legal opinion of bond counsel, O'Connor & Hannan, of Minneapolis,
Minnesota, which shall be complete except as to dating thereof, shall cause
such opinion to be filed in the offices of the City, and shall cause said
opinion to be printed on each of the Bonds, together with a certificate to be
signed by the manual or facsimile signature of the City Clerk in substantially
the following form:
I hereby certify that the foregoing is a full, true, and correct
copy of the legal opinion executed by the above -named attorneys,
except as to the dating thereof, which opinion has been handed to me
for filing in my office prior to the time of delivery of the Bonds.
City Clerk
City of Fridley, Minnesota
10. Execution of Bonds The Bonds shall be executed on behalf of the City by
the manual or facsimile signatures of the Mayor and the City Manager and shall
be duly authenticated by the manual signature of an authorized representative
of the Bond Registrar, hereby designated by the City as its authenticating
agent for the bonds pursuant to Minnesota Statutes, Section 475.55,
Subdivision 1. The Bonds, when fully executed, shall be delivered by the City
Finance Director to the Purchaser upon receipt of the purchase price, and the
Purchaser shall not be obligated to see to the proper application thereof. If
it becomes desirable or necessary that the City close on the Bonds prior to
the time that printed Bonds can be prepared, executed, and delivered, the City
may deliver to the Purchaser temporary typewritten or similarly prepared Bonds
(including with respect to each maturity a single Bond in the full principal
amount thereof) duly executed and authenticated in accordance with applicable
law, which temporary Bonds shall be exchanged for definitive Bonds as soon as
the same can be prepared and delivered in accordance with this Resolution.
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Page 11 - Resolution No. 63 - 1986
' 11. Escrow Deposit Agreement The form of the Escrow Deposit Agreement which
is on file in the office of the City Clerk and which has been proposed to be
entered into between the City and First Trust Company, Inc., St. Paul,
Minnesota, as Escrow Agent thereunder, for the purpose of providing an
irrevocable escrow of funds and investments for the payment (in accordance
with this Resolution and the Escrow Deposit Agreement) of certain interest on
the Bonds and certain amounts of the principal of the Series 1985 Bonds is
hereby approved, and the Mayor, City Manager, City Finance Director, and City
Clerk are hereby authorized and directed to execute such agreement in
substantially the form on file but with such changes thereto as the officers
executing the same may approve, which approval shall be conclusively evidenced
by their execution thereof. The Escrow Deposit Agreement shall be
irrevocable, and the City hereby covenants punctually to perform the terms and
conditions thereof and agrees to pay the reasonable charges of the Escrow
Agent thereunder.
12. Escrow Certification The firm of Grant Thornton, Minnesota, Minnesota,
certified public accountants, is hereby authorized and directed to provide
verifications and certifications with respect to the deposits and investments
in the Escrow Account and is further authorized to make such calculations as
may be necessary for the purposes of determining the sufficiency of the Escrow
Account to make certain timely payments of principal of the Series 1985 Bonds
and the interest on the Bonds (to the extent provided in this Resolution and
in the Escrow Deposit Agreement) and of determining compliance with yield
restrictions and other provisions of Section 103 (c) of the Internal Revenue
' Code of 1954, as amended, and regulations and rulings thereunder.
13. Debt Service Fund There is hereby created on the official books and
records of the City a fund designated as $2,705,000 General Obligation
Improvement Refunding Bonds, Series 1986, Debt Service Fund (the "Debt Service
Fund "), which shall be held in trust by the City for the benefit of the Owners
from time to time of the bonds, as hereinafter provided. Within the Debt
Service Fund, there shall be created and maintained (at least until the
Crossover Date) separate accounts designated as Interest Account and Principal
Account. Until the principal of and interest on the Bonds are paid, or until
all of the Bonds are otherwise discharged as hereinafter provided:
(A) The following amounts shall be credited to the Interest Account,
which funds are hereby pledged to and shall be used to pay interest
accruing on the Bonds prior to the Crossover Date:
(1) Any accrued interest on the Bonds received by the City upon
the actual delivery of the Bonds, except that the same may be used
to prepay earnings on, and in connection with the purchase of, the
Refunding Obligations under the Escrow Deposit Agreement for
subsequent application toward payment of the interest on the Bonds;
(2) All earnings on investments of funds held in the Escrow
Account (the "Escrow Earnings ") and received by the City pursuant
to the Escrow Deposit Agreement; and
' (3) Pre- Crossover Available Special Assessments to the extent that
the amounts described in (1) and (2) are insufficent to make timely
payments of the above - described interest on the Bonds when due.
Page 12 - Resolution No. 63 - 1986
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(B) There shall be credited to the Principal Account, and are hereby
pledged to the payment of the principal of the Bonds coming due on or
prior to the Crossover Date, Pre - Crossover Available Special Assessments
in amounts sufficient to pay the same, when due.
(C) From and after the Crossover Date, separate Accounts shall no longer
be required to be maintained in the Debt Service Fund, and the City shall
credit thereto, and hereby pledges to the payment of the principal of the
interest on the Bonds, when due, Post - Crossover Available Special
Assessments in amounts, but only in such amounts, which will be
sufficient for such purposes.
The City further pledges to the payment of the principal of and interest on
the Bonds, when due, the proceeds of any general ad valorem taxes hereafter
levied by the City for such purposes. The aforesaid funds in the Debt Service
Fund shall be used only and exclusively for, and are hereby pledged to, in
accordance with the provisions above, the payment of the Bonds in accordance
with their terms. If any such payment shall become due when there are not
sufficient funds in the Debt Service Fund to pay the same, the City Finance
Director shall pay such amounts from the general fund or other available fund
of the City, and such fund shall be reimbursed for such advances from the
proceeds of the Escrow Earnings (but only to the extent such advances of City
funds paid interest on the Bonds), the Pre - Crossover Special Assessments (if
before the Crossover Date), or the Post - Crossover Special Assessments (if
after the Crossover Date) or of any general ad valorem taxes hereafter levied
for such purposes, when collected.
' 14. Mandatory and Optional Redemption of Series 1985 Bonds As provided in
Section 3.07 of the Series 1985 Indenture, the principal amounts of the Series
1985 Bonds are subject to mandatory sinking fund redemption on February 1 in
the following years and amounts, respectively, among others:
Year
Amount
1988
$ 155,000
1989
170,000
1990
180,000
1991
195,000
1992
205,000
1993
220.000
To pay, when due, the foregoing mandatory redemptions of principal amounts of
the Series 1985 Bonds which occur prior to or on the Crossover Date, the City
shall use the following funds from the Reserve Account established pursuant to
paragraph 7 (b) of the Series 1985 Bond Resolution (but only to the extent
that the balance in the Reserve Account will not be less than the Minimum
Reserve Level (as defined in said paragraph) thereof following such
withdrawals), together with the following amounts of the principal proceeds of
the Bonds (specifically not including any earnings on funds invested in the
Escrow Account pursuant to the Escrow Deposit Agreement, respectively:
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Page 13 - Resolution No. 63 - 1986
Year of
Mandatory
Funds From
Funds From
'
Sinking Fund
Reserve
Escrow
Redemption
Account
Account
Total
1988
$ 131,750
$ 23,250
$155,000
1989
144,500
25,500
170,000
1990
153,000
27,000
180,000
1991
165,750
29,250
195,000
1992
174,250
30,750
205,000
1993
187,000
33,000
220,000
To pay the principal amounts of the optional redemption of the Series 1986
Bonds on the Crossover Date:
(A) If the Crossover Date is the First Crossover Date, the City shall
use the $2,205,750 of the principal proceeds of the Bonds then available
to the City from the Escrow Account for such purposes and $389,250 from
the Reserve Account; and
(B) If the Crossover Date is August 1, 1993, the City shall use the
$1,678,750 of the principal proceeds of the Bonds then available to the
City from the Escrow Account for such purposes and $296,250 from the
Reserve Account; and
(C) If the Crossover Date occurs after the First Crossover Date and
' before August 1, 1993, the respective amounts to be withdrawn from the
Escrow Account and the Reserve Account to make the optional redemption of
the Series 1985 Bonds otherwise outstanding thereon shall be adjusted
according.
To the extent that funds on hand in the Reserve Account are insufficient to
allow any of the withdrawals therefrom prescribed in this paragraph, (A) the
City shall use such additional funds as may be available for such purposes
pursuant to the Series 1985 Bond Resolution and the Series 1985 Indenture
(including without limitation such additional withdrawals from the Reserve
Account as may be permitted thereby) and (B), in the case of any shortfall of
funds for optional redemption of the Bonds on the Crossover Date, in addition
to the funds of the type described in (A) above (but using such funds first
for any mandatory sinking fund redemption of the Series 1985 Bond occurring on
the Crossover Date), the City shall use such other available funds of the City
as may be needed for such purposes, including without limitation available
general or other funds, special assessments levied for the Improvements (as
defined in the Series 1985 Bond Resolution) , or ad valorem tax levies, to the
effect that the crossover refunding of the Series 1985 Bonds shall be timely
made by the City on the Crossover Date.
15. Modification of Improvement Pledge to Series 1985 Bonds Pursuant to and
in accordance with the applicable provisions of this Resolution and the Escrow
Deposit Agreement, the City has caused to be escrowed and maintained in the
Escrow Account Government Obligations (as defined in the Series 1985
' Indenture) whose principal maturities will occur at such times and in such
amounts as will be sufficient, and the City hereby covenants that it shall
apply such necessary amounts thereof, to pay, when due, a total of $2,635,000
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Page 14 - Resolution No. 63 - 1986
of the principal of the Series 1985 Bonds, being more specifically (A) 85% of
the principal amounts of the mandatory sinking fund redemptions of the Series
1985 Bonds which occur on or prior to the conversion date and (B) 85% of the
principal amounts of the optional redemption of all of the Series 1985 Bonds
otherwise outstanding on the Crossover Date. To the extent that the City has
hereby provided the above - described security for the payment of said portion
of the principal of the Series 1985 Indenture. To the extent of the foregoing
provisions for such payments of the principal of the Series 1985 Bonds, the
pledge of special assessments to the payment thereof can be and is hereby
modified as follows: Section 7 (a) of the Series 1985 Bond Resolution is
hereby amended by replacing each occurrence therein of the term Special
Assessments (as defined therein) with the term Modified Series 1985 Special
Assessments (as defined in this Resolution).
16. Crossover Refunding Covenants The City hereby covenants that as long as
any of the Bonds remains undischarged under this Resolution it will not
optionally redeem any of the Series 1985 Bonds prior to the Crossover Date and
that it will not convert the Series 1985 Bonds to a Fixed Interest Rate, as
defined and provided in the Series 1985 Indenture, The City further covenants
that it will timely take or cause to be taken all actions necessary under the
applicable provisions of the Series 1985 Bond Resolution, the Series 1985
Indenture, the Escrow Deposit Agreement, and this Resolution to effect a
crossover refunding of the Series 1985 Bonds on the Crossover Date.
17. Pledge of Full Faith and Credit to Bonds The full faith and credit and
' taxing powers of the City are hereby pledged to the payment of the principal
of and interest on the Bonds, and in the event of any current or anticipated
deficiency of funds in the Debt Service Fund of amounts needed to make any
such payment, when due, the City Council shall levy ad valorem taxes on all
taxable property in the City in the amount of such deficiency.
18. Debt Service Sufficiency It is hereby determined that the funds pledged
by this Resolution to the payment of the Bonds will produce at least 5% in
excess of the amount needed to pay, when due, the principal of and interest on
the Bonds, and that no tax levy is needed at this time. The City Clerk is
directed to file a certified copy of this Resolution with the County Auditor
of Anoka County and to obtain the certificate required by Minnesota Statutes,
Section 475.63.
19. Transcript Certification The officers of the City are hereby 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 to furnish such other certificates, affidavits, and transcripts as may be
required to show 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, shall be deemed representations of the City as to the facts stated
therein.
'
20.
City
Official Statement Certification The Mayor, the City
Finance Director are hereby authorized and directed to
Manager, and the
certify that they
have
examined the official statement or prospectus prepared
and circulated in
connection with the issuance and sale of the Bonds and that to the best of
� 21:
Page 15 - Resolution No. 63 - 1986
their knowledge and belief said official statement is a complete and accurate
representation of the facts and representations made therein as they relate to
the City.
21. General Non - Taxability Covenant The City covenants and agrees with the
owners from time to time of the Bonds that the City 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 1954, as amended (the "Code "), and regulations issued
thereunder, as now existing or as hereafter amended or proposed and in effect
at the time of such action, and that it will take, or it will cause to be
taken, all affirmative actions within its power which may be necessary to
insure that such interest will not become subject to income taxation under the
Code.
22. Discharge When any Bond has been discharged as provided in this
paragraph, all pledges, covenants, and other rights granted by this Resolution
to the owner(s) of such Bond shall cease, and such Bond shall no longer be
deemed to be outstanding under this Resolution. The City may discharge its
obligations with respect to any Bond which is due on any date by depositing
with the Bond Registrar on or before that date a sum sufficient for the
payment thereof in full; or, if any Bond should not be paid when due, it may
nevertheless be discharged by depositng with the Bond Registrar a sum
sufficient for the payment thereof in full with interest accrued to the date
of such deposit. The City may also discharge its obligations with respect to
' any prepayable Bonds by depositing with the Bond Registrar on or before the
duly declared date of prepayment an amount equal to the principal and interest
then due, provided that notice of such redemption has been duly given
according to law. The City may also at any time discharge its obligations
with respect to any Bonds, subject to the provisions of law now or hereafter
authorizing and regulating such action, by depositing irrevocably in escrow,
with a bank qualified by law as an escrow agent for this purpose, cash or
securities which are authorized by law to be so deposited, bearing interest
payable at such times and at such rates and maturing on such dates as shall be
required to pay all principal and interet on such Bonds as the same become
due.
23. Amendment to Reimbursement Agreement; Expectation of No- Default
Thereunder The First Amendment to Reimbursement Agreement proposed to be
entered into by the City and the Bank in connection with the final rating of
the Series 1985 Bonds is hereby approved, and the officers of the City are
hereby authorized and directed to execute the same upon the issuance of the
Bonds, with such amendments thereof as such officers with the advice of Bond
Counsel may deem necessary or desirable, as evidenced by their execution
thereof. The Council reasonably expects that no Event of Default under and as
defined in the Reimbursement Agreement will occur during the term of said
Agreement.
24. Headings The paragraph headings used in this Resolution are for
facilitation of reference only and are not intended to affect the
interpretation of the text hereof.
127
Page 16 - Resolution No. 63 - 1986
' PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 14TH DAY OF
AUGUST, 1986
WILLIAM J. NEE(/MAYOR
ATTEST:
SHIRLEY A. HB,APALA - CITIr CLERK
1
EXHIBIT "A"
AMENDED TAX INCREMENT PLEDGE AGREEMENT
This Amended Tax Increment Pledge Agreement (the "Agreement ") is dated as of
August 1, 1986; is by and between the City of Fridley, Minnesota (the "City "),
and the Housing and Redevelopment Authority in and for the City of Fridley,
Minnesota (the "Authority "); and provides as follows:
WHEREAS, on December 16, 1985, the City Council adopted a resolution (the
"Series 1985 Bond Resolution ") awarding the sale of the City's $11,550,000
Variable Rate Demand General Obligation Tax Increment Bonds, dated December
30, 1985 (the "Series 1985 Bonds "), to provide financing for certain public
improvements (the "Improvements ") made or to be made with respect to the
Authority's Redevelopment Project No. 1; and
WHEREAS, on August 14, 1986, it is proposed that the City Council adopt a
resolution (the "Series 1986 Bond Resolution ") authorizing the issuance of the
City's $10,045,000 General Obligation Tax Increment Refunding Bonds, dated
August 1, 1986 (the "Series 1986 Bonds ") , for the purpose of crossover
refunding the Series 1985 Bonds; and
WHEREAS, in connection with the issuance of the Series 1985 Bonds, the
' Authority and the City entered into a certain Tax Increment Pledge Agreement,
dated as of December 1, 1985 (the "Tax Increment Pledge Agreement ") , and in
connection with the issuance of the Series 1986 Bonds it is necessary to amend
and supplement the Tax Increment Pledge Agreement by entering into this
Agreement to amend the pledge of tax increments made to provide for the
payment of the debt service on the Series 1985 Bonds and to provide
appropriate pledges of tax increments for the payment of the debt service on
the Series 1986 Bonds.
NOW, THEREFORE, BE IT RESOLVED in consideration of the covenants and
agreements hereof between the City and the Authority, and pursuant to
Minnesota Statutes, Section 273.77 (a), the City and the Authority hereby
agree as follows:
1. Any capitalized term which is used but not defined in this Agreement shall
have the meaning given to that term in the Series 1986 Bond Resolution.
2. In accordance with paragraph 15 of the Series 1986 Bond Resolution,
paragraph 2 of the Tax Increment Pledge Agreement shall be amended to the
effect that the tax increments pledged therein to the payment of the Series
1985 Bonds shall be the Modified Series 1985 Tax Increments.
3. In order to pay the principal of and interest on the Series 1986 Bonds,
when due, the Authority hereby pledges to the City, for deposit in the Series
1986 Debt Service Fund established by the Series 1986 Bond Resolution for the
payment of the Bonds, and the Authority shall pay to the City, Pre - Crossover
Available Tax Increments and Post - Crossover Available Tax Increments at the
times, in the amounts and for the specific purposes set forth in the Series
Page 2 - Amended Tax Increment Pledge Agreement
' 1986 Bond Resolution, including without limitation paragraph 13 thereof, and,
to the extent such tax increments are ever insufficient for such purposes, and
the City, pursuant to the Series 1986 Bond Resolution, advances City funds to
provide prompt and full payment of the Series 1986 Bonds, the Authority agrees
to reimburse the City for such advances from such tax increments, when
collected by the Authority.
4. Paragraph 3 of the Tax Increment Pledge Agreement shall be amended to
provide as follows:
"In each calendar year (the "Current Year "), the tax increments
which the Authority shall receive in the prior calendar year from
its Tax Increment Financing District No. 6 shall be applied in the
following priority:
(A) First, to pay the principal and interest payable in the Current
Year on the District 6 Bonds, and for this purpose, any prior
redemptions of the Bonds shall be deemed to be a redemption of the
District 6 Bonds only if and to the extent that such redemption is
made with proceeds of the District 6 Bonds which were not expended
for the purposes for which the District 6 Bonds were issued; and
(B) Second, to pay the amounts payable in the Current Year on the
Authority's $5,603,755.80 Limited Revenue Capital Appreciation Tax
Increment Note (the "Capital Appreciation Note "); and
' (C) Third, to prepay the District 6 Bonds, to the extent that such
Bonds are prepayable in the Current Year; and
(D) Fourth, to prepay the Capital Appreciation Note, to the extent
such Note are prepayable in the Current Year; and
(E) Fifth, to compensate for any shortfall of tax increments
pledged to the Bonds pursuant to paragraph 2 hereof; and
(F) Sixth and finally, for application to any other purpose which
the Authority, in its sole discretion, may determine."
5. An executed copy of this Agreement shall be filed with the County Auditor
of Anoka County, as requried by Minnesota Statutes, Section 273.77 (a).
6. The Tax Increment Pledge Agreement shall remain in full force and effect
in accordance with its terms, as amended by this Agreement.
7. This Agreement shall become effective upon the actual issuance and
delivery of the Series 1986 Bonds.
1 10
Page 3 - Amended Tax Increment Pledge Agreement
IN WITNESS WHEREOF the City and the Authority have caused this Agreement to be
' duly executed as of the day and year first above written.
CITY OF FRIDLEY, MINNESOTA
By
Its Mayor
By
ATTEST: Its City Manager
City Clerk
(SEAL)
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY
OF FRIDLEY, MINNESOTA
By
Its Chairman
1 By
Its Director