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RES 1995-70 - 00002930104 RESOLUTION NO. 70 - 1995 RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF $4,090,000 GENERAL OBLIGATION TEMPORARY TAR INCREMENT BONDS, SERIES 1995A BE IT RESOLVED by the City Council (the "Council ") of the City of Fridley, Minnesota (the "City "), as follows: 1. Recitals. It is hereby determined: (a) The Council believes it to be in the City's best interest to consider a refinancing of the City's General Obligation Temporary Tax Increment Bonds, Series 1992C, dated December 1, 1992, issued and still outstanding in the original principal amount of $4,030,000 (the "Prior Bonds "). The Prior Bonds financed the acquisition by the Fridley HRA of certain property and other assets (the "Project "). (b) The Prior Bonds mature on December 1, 1995, in the aggregate principal amount of $4,030,000. (c) It is necessary for the City to issue its General Obligation Temporary Tax Increment Bonds, Series 1995A (the "Bonds "), pursuant to Minnesota Statutes, Section 469.178, Subdivision 5, and Chapter 475, to provide ' moneys for a refinancing of the Prior Bonds, given that the necessary tax increment revenues are not available for such purposes. (d) The Council desires that the Bonds be issued initially in "Book Entry Only Form" (as hereinafter described). 2. Acceptance of Offer. The offer of Norwest Investment Services, Inc. (the "Purchaser ") to purchase the City's $4,090,000 General Obligation Temporary Tax Increment Bonds, Series 1995A (the "Bonds "), is hereby accepted, such bid being to purchase the Bonds at a price of $4,065,460.00 plus accrued interest to date of delivery, the Bonds to bear interest, to mature, and to be subject to such other terms and conditions as hereinafter provided. The sum' of $6,135.00, being the amount bid in excess of $4,059,325, shall be credited to the Debt Service Account hereinafter created. The City Finance Director is directed to retain the good faith deposit of the Purchaser pending completion of the sale and delivery of the Bonds and to return the deposits of the unsuccessful bidders forthwith. 3. Terms of Bonds. (a) Title: Original Issue Date: Denominations: Maturities. The Bonds shall be titled "General Obligation Temporary Tax Increment Bonds, Series 1995A ", shall be dated November 1, 1995, as the date of original issue and shall be issued forthwith on or after such date as fully registered ' bonds. The Bonds shall be numbered from R -1 upward in the denomination of $5,000 each or in any integral multiple thereof of a single maturity. The Bonds shall mature on November 1, 1998. 105 Page 2 -- Resolution No. 70 - 1995 (b) Book Entry Only System. Midwest Securities Trust Company, a limited purpose trust company organized under the laws of the State of Illinois, or any of its successors to its functions hereunder (the "Depository "), will act as securities depository for the Bonds, and to this end: (i) The Bonds shall be initially issued and, so long as they remain in book entry form only (the "Book Entry Only Period "), shall at all times be in the form of a separate single fully registered Bond for each maturity of the Bonds; and for purposes of complying with this requirement under paragraphs 6 and 11 of this Resolution, authorized denominations for each maturity of Bonds shall be deemed to be limited during the Book Entry Only Period to the outstanding principal amount of that maturity. While in such book entry form, the Bonds are sometimes hereinafter referred to as being in "Book Entry Only Form." (ii) Upon initial issuance, ownership of the Bonds shall be registered in a bond register maintained by the Bond Registrar appointed pursuant to paragraph 7 of this Resolution in the name of KRAY & CO., as the nominee (it or any nominee of the existing or a successor Depository, the "Nominee "). (iii) With respect to the Bonds, neither the City nor the Bond Registrar shall have any responsibility or obligation to any broker, dealer, bank, or any other financial institution for which the Depository holds Bonds as securities depository (the "Participant ") or to the person for which a Participant holds an interest in the Bonds shown on the books and records of the Participant (the "Beneficial Owner "). Without limiting the immediately preceding sentence, neither the City, nor the Bond Registrar, shall have any such responsibility or obligation with respect to (A) the accuracy of the records of the Depository, the Nominee or any Participant with respect to any ownership interest in the Bonds, or (B) the delivery to any Participant, any Beneficial Owner or any other person, other than the Depository, of any notice with respect to the Bonds, including any notice of redemption, or (C) the payment to any Participant, any Beneficial Owner or any other person, other than the Depository, of any amount with respect to the principal of or premium, if any, or interest on the Bonds, or (D) the consent given or other action taken by the Depository as the registered owner of any Bonds (the "Holder "). For purposes of securing the vote or consent of any Holder under this Resolution, the City may, however, rely upon an omnibus proxy under which the Depository assigns its consenting or voting rights to certain Participants to whose accounts the Bonds are credited on the record date identified in a listing attached to the omnibus proxy. (iv) The City and the Bond Registrar may treat as and deem the Depository to be the absolute owner of the Bonds for the purpose of payment of the principal of and premium, if any, and interest on the Bonds, for the purpose of giving notices of redemption and other matters with respect to the Bonds, for the purpose of obtaining any consent or other action to be taken by Holders for ' the purpose of registering transfers with respect to such Bonds, and for all purpose whatsoever. The Bond Registrar, as paying agent hereunder, shall pay all principal of and premium, if any, and interest on the Bonds only to or 1 1 •. ' Page 3 -- Resolution No. 70 - 1995 upon the Holder or the Holders of the Bonds, as shown on the Bond Registrar's bond register, and all such payments shall be valid and effective to fully satisfy and discharge the City's obligations with respect to the principal of and premium, if any, and interest on the Bonds to the extent of the sum or sums so paid. (v) Upon delivery by the Depository to the Bond Registrar of written notice to the effect that the Depository has determined to substitute a new Nominee in place of the existing Nominee, and subject to the transfer provisions in paragraph 11 hereof, references to the Nominee hereunder shall refer to such new Nominee. (vi) So long as any Bond is registered in the name of a Nominee, all payments with respect to the principal of and premium, if any, and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, by the Bond Registrar or the City, as the case may be, to the Depository as provided in the Depository Letter Agreement required by the Depository as a condition to its acting as book -entry Depository for the Bonds (said Depository Letter Agreement, together with any replacement thereof or amendment or substitute thereto, including any standard procedures or policies referenced therein or applicable thereto respecting the procedures and other matters relating to the Depository's role as book -entry Depository for the Bonds, are collectively hereinafter referred to as the "Depository Letter ' Agreement "). (vii) All transfers of beneficial ownership interests in each Bond issued in book -entry form shall be limited in principal amount to authorized denominations and shall be effected by the Depository with the Participants for recording and transferring the ownership of beneficial interests in such Bonds. (viii) In connection with any notice or other communication to be provided to the Holders pursuant to this Resolution by the City or the Bond Registrar with respect to any consent or other action to be taken by Holders, the Depository shall consider the date of receipt of notice requesting such consent or other action as the record date for such consent or other action; provided, that the City or the Bond Registrar may establish a special record date for such consent or other action. The City or the Bond Registrar shall, to the extent possible, give the Depository notice of such special record date not less than 15 calendar days in advance thereof to the extent possible. (ix) Any successor Bond Registrar, in its written acceptance of its duties under this Resolution and any paying agency registrar agreement, shall agree to take any actions necessary from time to time to comply with the requirements of the Depository Letter Agreement. (x) In the case of a partial prepayment of a Bond, the Holder may, in lieu of surrendering the Bond for a Bond of a lesser denomination as provided in paragraph 6 hereof, make a notation of the reduction in principal amount on the panel provided on the Bond stating the amount so redeemed. i[et1 ' Page 4 -- Resolution No. 70 - 1995 (c) Termination of Book -Entry Only System. Discontinuance of a particular Depository's services and termination of the book -entry only system may be effected as follows: (i) The Depository may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice to the City and discharging its responsibilities with respect thereto under applicable law. The City may terminate the services of the Depository with respect to the Bonds if the City determines that the Depository is no longer able to carry out its functions as securities depository or the continuation of the system of book -entry transfers through the Depository is not in the best interests of the City. (ii) Upon termination of the services of the Depository as provided in the preceding paragraph, and if no substitute securities depository is willing to undertake the functions of the Depository hereunder can be found which, in the opinion of the City, is willing and able to assume such functions upon reasonable or customary terms, or if the City determines that it is in the best interests of the City that the Beneficial Owners be issued certificates for the Bonds, the Bonds shall no longer be registered in the name of the Nominee, but may be registered in whatever name or names the Holder of the Bonds shall designate at that time, in accordance with paragraph 11 hereof. To the extent that the Beneficial Owners are designated as the transferee by ' the Holders, in accordance with paragraph 11 hereof, the Bonds will be delivered to the Beneficial Owners. (iii) Nothing in this subparagraph (c) shall limit or restrict the provisions of paragraph 11 hereof. (d) Depository Letter Agreement. The Mayor and City Manager are authorized to execute in the name of the City the Depository Letter Agreement in substantially the form on file in the offices of the City. In the event of the disability or the resignation or other absence of the Mayor or City Manager, such other officers of the City who may act in their behalf shall without further act or authorization of the City do all things and execute all instruments and documents required to be done or to be executed by such absent or disabled officials. The provisions in the Depository Letter Agreement are incorporated herein by reference and made fully a part of this Resolution to the same extent as if set forth in full herein, and if and to the extent that any provisions of this Resolution are inconsistent or in conflict with the provisions of the Depository Letter Agreement, the provisions in the Depository Letter Agreement shall control. 4. Purpose: Temporary Bonds: Certain Covenants Respectine Pavment of Bonds. The Bonds shall provide moneys for a current refunding of the City's Prior Bonds. It is hereby found, determined and declared that such refunding is ' necessary or desirable for the reduction of debt service cost to the City and /or the adjustment of the maturities of the Prior Bonds in relation to the sources for their repayment and will result in a reduction of debt service 1: ' Page 5 -- Resolution No: 70 - 1995 cost to the City. All of the proceeds, including all investment earnings thereon, of the Prior Bonds have heretofore been expended by the City for the uses and purposes for which the City issued said Prior Bonds. The balance in the debt service account heretofore established by the City for the payment of the principal of and interest on the Prior Bonds has been taken into account in appropriately sizing the Bonds, and some monies therein are expected to be combined as of December 1, 1995, to the extent necessary, with the available proceeds of the Bonds in order to obtain a sum sufficient to accomplish the refunding and to pay the regularly scheduled debt service due on the Prior Bonds on said date; otherwise, the current and anticipated balances in said debt service account do not exceed and are not expected to exceed the aggregate amount of regularly scheduled debt service on the Prior Bonds which is payable on or before December 1, 1995, except only insofar as may be necessary to provide sufficient funds, together with the other monies available for such purposes, to provide for the payment of the debt service first coming due on the Bonds. The City has observed and complied with all of its obligations and covenants made by the City in connection with the issuance of the Prior Bonds. In addition to the Bonds being general obligations of the City, certain tax increments derived from certain tax increment financing districts within Redevelopment Project No. 1 of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, as provided in the Tax Increment Pledge Agreement described in paragraph 24 of this Resolution, shall be pledged to the payment of the Bonds. The Bonds are being issued as "temporary bonds" within the meaning of Minnesota Statutes, Section 469.178, Subdivision 5, pursuant to which the City is required and hereby covenants to issue (to the extent that the principal of and interest on the Bonds cannot be paid, when due, from receipts of such tax increment or other funds appropriated and pledged for such purposes) long -term bonds (the "Definitive Bonds ") in such amount as shall be required to provide sufficient revenues for such debt service purposes, and the provisions of said Subdivision 5 (including the rights therein prescribed of the owners of the Bonds) are hereby incorporated into this Resolution to the same extent as though set forth in full at this point. The estimated collection of the above described tax increments is not less than 208 of the cost of the Project which was financed through the issuance of the Prior Bonds. 5. Interest. The Bonds shall bear interest at the rate of 4.108 per annum, and interest shall be payable semiannually on May 1 and November 1 of each year (each, an "Interest Payment Date "), commencing May 1, 1996, calculated on the basis of a 360 -day year consisting of twelve 30 -day months. 6. Redemption. The Bonds shall be subject to redemption and prepayment at the option of the City on May 1, 1996, and on any date thereafter at a price of par plus accrued interest to date of redemption. Redemption may be in whole or in part, and if only part, the specific Bonds to be prepaid shall be ' chosen by lot by the Bond Registrar. Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Published 109 ' Page 6 -- Resolution No. 70 - 1995 notice of redemption shall in each case be given if and to the extent required by applicable law, and mailed notice of redemption shall be given to the paying agent and to each affected registered owner of the Bonds. To effect a partial redemption of Bonds, the Bond Registrar, prior to giving notice of redemption, shall assign to each Bond a distinctive number for each $5,000 of the principal amount of such Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers so assigned to such Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of each such Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the City or Bond Registrar duly executed by the registered owner thereof or by the registered owner's attorney, duly authorized in writing) and the City shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the registered owner of such Bond, without service charge, a new Bond or Bonds of the same series having the same stated maturity and interest rate and of any authorized denomination or denominations, as requested by such registered ' owner, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. 7. Bond Registrar. First Trust National Association, in St. Paul, Minnesota, is appointed to act as bond registrar and transfer agent with respect to the Bonds (the "Bond Registrar "), and shall do so unless and until a successor Bond Registrar is duly appointed, all pursuant to any contract the City and Bond Registrar shall execute which is consistent herewith. The Bond Registrar shall also serve as paying agent unless and until a successor paying agent is duly appointed. The principal of and interest on the Bonds shall be paid to the registered owners (or record owners) of the Bonds in the manner set forth in the form of Bond and paragraph 13 of this Resolution. 8. Form of Bond. The Bonds, together with the Bond Registrar's Certificate of Authentication, the form of Assignment and the registration information thereon, shall be in substantially the following form: J Page 7 -- Resolution No. 70 - 1995 R- INTEREST RATE REGISTERED OWNER: UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF ANOKA CITY OF FRIDLEY GENERAL OBLIGATION TEMPORARY TAX INCREMENT BOND, SERIES 1995A MATURITY DATE OF DATE ORIGINAL ISSUE CUSIP PRINCIPAL AMOUNT: DOLLARS 110 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 specified above, or registered assigns, in the manner ' hereinafter set forth, the principal amount specified above on the maturity date specified above, unless duly called for earlier redemption, and to pay interest thereon semiannually on May 1 and November 1 of each year (each, an "Interest Payment Date "), commencing May 1, 1996, at the rate per annum specified above (calculated on the basis of a 360 -day year consisting of twelve 30 -day months) until the principal sum is paid or has been provided for. This Bond will bear interest from the most recent Interest Payment Date to which interest has been paid or, if no interest has been paid, from the date of original issue hereof. The principal of and premium, if any, on this Bond are payable upon presentation and surrender hereof at the principal office of , in Minnesota (the "Bond Registrar "), acting as paying agent, or at the principal office of any successor paying agent duly appointed by the City. Interest on this Bond will be paid on each Interest Payment Date by check or draft mailed to the person in whose name this Bond is registered (the "Registered Owner ") on the registration books of the City maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth day of the calendar month preceding such Interest Payment Date (the "Regular Record Date "). Any interest not so timely paid shall cease to be payable to the person who is the Registered Owner hereof as of the Regular Record Date, and shall be payable to the person that is the Registered Owner hereof at the close of business on a date (the "Special Record Date ") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given to Registered ' Owners not less than ten days prior to the Special Record Date. The principal of and premium, if any, and interest on this Bond are payable in lawful money of the United States of America. 111 Page 8 -- Resolution No. 70 - 1995 1 REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the Home Rule Charter of the City and the Constitution and laws of the State of Minnesota to be done, to 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 of original issue hereof and the date of its actual issuance and delivery to the original purchaser, does not exceed any constitutional, Charter or statutory limitation of indebtedness. IN WITNESS WHEREOF, the City of Fridley, Anoka County, Minnesota, by its City Council, has caused this Bond to be executed on its behalf by the facsimile signatures of its Mayor and its City Manager; has caused the corporate seal of the City to be intentionally omitted herefrom, as permitted by law; and has caused this Bond to be executed manually by the Bond Registrar, acting as the City's duly appointed authenticating agent for the Bonds. 112 Page 9 -- Resolution No. 70 - 1995 Date of Registration: Registrable by: Payable at: BOND REGISTRAR'S CITY OF FRIDLEY, CERTIFICATE OF ANOKA COUNTY, MINNESOTA AUTHENTICATION This Bond is one of the Bonds described in the /s/ Facsimile Resolution mentioned Mayor within. /s/ Facsimile City Manager Bond Registrar ' By (s/ Manual Authorized Signature 113 ' Page 10 -- Resolution No. 70 - 1995 ON REVERSE OF BOND 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 date thereof, which opinion has been handed to me for filing in my office prior to the time of delivery of the Bonds. (facsimile signature) City Clerk City of Fridley, Minnesota Redemption. All Bonds of this issue are subject to redemption and prepayment at the option of the City on May 1, 1996, and on any date thereafter at a price of par plus accrued interest to date of redemption. Redemption may be in whole or in part, and if only part, the Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Published notice of redemption shall in each case be given if and to the extent required by applicable law, and mailed notice of redemption shall be given to the paying agent and to each affected registered owner of the Bonds. ' Selection of Bonds for Redemption: Partial Redemption. To effect a partial redemption of Bonds, the Bond Registrar shall assign to each Bond a distinctive number for each $5,000 of the principal amount of such Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers assigned to the Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of such Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the City or Bond Registrar duly executed by the registered owner thereof or the registered owner's attorney duly authorized in writing), and the City shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the registered owner of such Bond, without service charge, a new Bond or Bonds of the same series having the same stated maturity and interest rate and of any authorized denomination or denominations, as requested by such registered owner, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered. Issuance: Purpose: General Obligation. This Bond is one of an issue in the total principal amount of $4,090,000, all of like date of original issue and ' tenor, except as to registration number and denomination, which Bond has been issued pursuant to and in full conformity with the Home Rule Charter of the City and the Constitution and laws of the State of Minnesota and pursuant to a resolution adopted by the City Council on October 23, 1995 (the "Resolution "), 114 Page 11 -- Resolution No. 70 - 1995 for the purpose of providing money to aid in refinancing a project consisting of certain public redevelopment costs within Redevelopment Project No. 1 of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota. The Bonds are issued as "temporary bonds" within the meaning of Minnesota Statutes, Section 469.178, Subdivision 5, pursuant to which the City is required, and the City hereby covenants, to issue additional bonds at such time or times and in such amounts as may be required to pay the principal of and interest on the Bonds, when due, if and to the extent that said debt service cannot be paid from the sources pledged to the payment thereof. This Bond is payable out of the General Obligation Temporary Tax Increment Bonds, Series 1995A Fund of the City. This Bond constitutes a general obligation of the City, and to provide moneys for the prompt and full payment of its principal, premium, if any, and interest when the same become due, the full faith and credit and taxing powers of the City have been and are hereby irrevocably pledged. Each capitalized term which is used but not otherwise defined in this Bond shall have the meaning given to that term in the Resolution. [For Bonds in Book Entry Only Form, the following paragraph shall be added, and this Bond form (1) may be rearranged so that the signature blocks hereof appear at the end of the main text of this form or (2) may otherwise be amended to conform to book entry requirements and the Depository Letter ' Agreement.] Book -Entry Only Form: Depository Letter Agreement. Pursuant to the Resolution, the Bonds may be issued in Book -Entry Only Form, and during any period in which Bonds are in such form, the provisions applicable to the Bonds pursuant to the Depository Letter Agreement shall apply, notwithstanding any contrary or inconsistent provision herein or in the Resolution. Denominations* Exchange: Resolution. The Bonds are issuable solely as fully registered bonds in the denominations of $5,000 and integral multiples thereof of a single maturity and are exchangeable for fully registered bonds of other authorized denominations in equal aggregate principal amounts at the principal office of the Bond Registrar, but only in the manner and subject to the limitations provided in the Resolution. Reference is hereby made to the Resolution for a description of the rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal office of the Bond Registrar. Transfer. This Bond is transferable by the Registered Owner in person or by the Registered Owner's attorney duly authorized in writing at the principal office of the Bond Registrar upon presentation and surrender hereof to the Bond Registrar, all subject to the terms and conditions provided in the Resolution and to reasonable regulations of the City contained in any agreement with the Bond Registrar. Thereupon the City shall execute and the ' Bond Registrar shall authenticate and deliver, in exchange for this Bond, one or more new fully registered Bonds in the name of the transferee (but not registered in blank or to "bearer" or similar designation), of an authorized denomination or denominations, in aggregate principal amount equal to the 1 116 Page 13 -- Resolution No. 70 - 1995 ABBREVIATIONS 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 UTMA - as custodian for (Cust) (Minor) under the Uniform (State) Transfers to Minors Act Additional abbreviations may also be used though not in the above list. ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto the within ' Bond and does hereby irrevocably constitute and appoint as attorney to transfer the Bond on the books kept for the registration thereof, 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 national bank or trust company 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 transferee requested below is provided. Name and Address: ' (Include information for all joint owners if the Bond is held by joint account.) 117 Page 14 -- Resolution No. 70 - 1995 Use only for Bonds when they are Registered in Book Entry Only Form PREPAYMENT LEDGER The principal of this Bond has been prepaid in part on the date(s) and in the amount(s) as follows: Authorized Signature Date Amount of Holder ME' ' Page 15 -- Resolution No. 70 - 1995 9. Execution: Interim Tvnewritten Bonds. The Bonds shall be executed on behalf of the City by the signatures of its Mayor and City Manager and be sealed with the seal of the City; provided, however, that the seal of the City may be a printed facsimile; and provided further that both of such signatures may be printed facsimiles, and the corporate seal may be omitted on the Bonds as permitted by law. In the event of disability or resignation or other absence of either such officer, the Bonds may be signed by the manual or facsimile signature of that officer who may act on behalf of such absent or disabled officer. In case either such officer whose signature or facsimile of whose signature shall appear on the Bonds shall cease to be such officer before the delivery of the Bonds, such signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if he or she had remained in office until delivery. The City may elect to deliver, in lieu of printed bonds, one or more interim typewritten bonds in substantially the form set forth above. Such interim bonds shall, upon the printing of the bonds and the execution thereof, be exchanged therefor and canceled. 10. Authentication. No Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit under this Resolution unless a Certificate of Authentication on such Bond, substantially in the form hereinabove set forth, shall have been duly executed by an authorized representative of the Bond Registrar. Certificates of Authentication on ' different Bonds need not be signed by the same person. The Bond Registrar shall authenticate the signatures of officers of the City on each Bond by execution of the Certificate of Authentication on the Bond and by inserting as the date of registration in the space provided the date on which the Bond is authenticated, except that for purposes of delivering the original Bonds to the Purchaser, the Bond Registrar shall insert as a date of registration the date of original issue, which date is November 1, 1995. The Certificate of Authentication so executed on each Bond shall be conclusive evidence that it has been authenticated and delivered under this Resolution. 11. Registration: Transfer principal office of the Bon such reasonable regulations Registrar shall provide for transfers of Bonds entitled provided. Exchange. The City will cause to be kept at the i Registrar a bond register in which, subject to as the Bond Registrar may prescribe, the Bond the registration of Bonds and the registration of to be registered or transferred as herein Upon surrender for transfer of any Bond at the principal office of the Bond Registrar, the City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration (as provided in paragraph 10) of, and deliver, in the name of the designated transferee or transferees, one or more new Bonds of any authorized denomination or denominations of a like aggregate principal amount, having the same stated maturity and interest rate, as requested by the transferor; provided, however, that no Bond may be registered in blank or in the name of "bearer" or similar designation. At the option of the registered owner thereof, Bonds may be exchanged for Bonds of any authorized denomination or denominations of a like aggregate 1 119 Page 16 -- Resolution No. 70 - 1995 principal amount and stated maturity, upon surrender of the Bonds to be exchanged at the principal office of the Bond Registrar. Whenever any Bonds are so surrendered for exchange, the City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the registered owner making the exchange is entitled to receive. All Bonds surrendered upon any exchange or transfer provided for in this Resolution shall be promptly canceled by the Bond Registrar and thereafter disposed of as directed by the City. All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general obligations of the City evidencing the same debt, and entitled to the same benefits under this Resolution, as the Bonds surrendered for such exchange or transfer. Every Bond presented or surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, in form satisfactory to the Bond Registrar, duly executed by the registered owner thereof or the registered owner's attorney duly authorized in writing. The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of any Bond and any legal or unusual costs regarding transfers and lost Bonds. Transfers shall also be subject to reasonable regulations of the City contained in any agreement with the Bond Registrar, including regulations which permit the Bond Registrar to close its transfer books between record dates and payment dates. 12. Rights Upon Transfer or Exchange. Each Bond delivered upon transfer of or in exchange for or in lieu of any other Bond shall carry all the rights to interest accrued and unpaid, and to accrue, which were carried by such other Bond. 13. Interest Payment: Record Date. Interest on any Bond shall be paid on each Interest Payment Date by check or draft mailed to the person in whose name the Bond is registered on the registration books of the City maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth (15th) day of the calendar month preceding such Interest Payment Date (the "Regular Record Date "). Any such interest not so timely paid shall cease to be payable to the person who is the registered owner thereof as of the Regular Record Date, and shall be payable to the person who is the registered owner thereof at the close of business on a date (the "Special Record Date") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given by the Bond Registrar to the registered owners not less than ten (10) days prior to the Special Record Date. 120 1 Page 17 -- Resolution No. 70 - 1995 14. Treatment of Registered Owner. The City and Bond Registrar may treat the person in whose name any Bond is registered as the owner of such Bond for the purpose of receiving payment of principal of and premium, if any, and interest (subject to the payment provisions in paragraph 13 above) on, such Bond and for all other purposes whatsoever whether or not such Bond shall be overdue, and neither the City nor the Bond Registrar shall be affected by notice to the contrary. 15. Delivery: Application of Proceeds. The Bonds when so prepared and executed shall be delivered by the City Finance Director to the Purchaser upon receipt of the purchase price, and the Purchaser shall not be obliged to see to the proper application thereof. 16. Fund and Accounts. There is hereby created a special fund to be designated the "General Obligation Temporary Tax Increment Bonds, Series 1995A Fund" (the "Fund ") to be administered and maintained by the City as a bookkeeping account separate and apart from all other funds maintained in the official financial records of the City. The Fund shall be maintained in the manner herein specified until all of the Bonds and the interest thereon have been fully paid. There shall be maintained in the Fund two separate accounts, to be designated the "Refunding Account" and "Debt Service Account," respectively. ' (i) Refunding Account. The proceeds of the sale of the Bonds, less such proceeds of the Bonds (if any) as may be used to pay issuance expenses or hereinafter directed for deposit into the Debt Service Account, plus any other available municipal funds ( "Other Funds "), if any, as may be required to adequately fund the Refunding Account to accomplish its purposes, together with all investment earnings on funds held in the Refunding Account, are hereby pledged and appropriated and shall be credited to the Refunding Account. The Refunding Account may be invested only in securities maturing or callable on such dates and bearing interest at such rates as shall be required to provide funds sufficient, together with any cash or other funds retained in the Refunding Account, and together with monies made available from the debt service account for the Prior Bonds, to pay all principal and interest due on the Prior Bonds on December 1, 1995, whether due thereon by virtue of regularly scheduled debt service or prior redemption. The moneys in the Refunding Account shall be used solely for the purposes herein set forth and for no other purpose, except that any surplus in the Refunding Account shall be remitted to the City. Such Other Funds, if any, as may be required to fully fund the Refunding Account as described above are hereby appropriated for said purpose. (ii) Debt Service Account. To the Debt Service Account there are hereby pledged and irrevocably appropriated and there shall be credited: (1) all accrued interest and unused discount received upon delivery of the Bonds which ' is not then deposited into the Refunding Account; (2) any balance remaining on December 1, 1995, after payment thereon of all of the principal of and interest on all of the Prior Bonds, in the debt service account created for and allocated to the Prior Bonds pursuant to paragraph 15 of the Council's 121 ' Page 18 -- Resolution No. 70 - 1995 Resolution, adopted on November 23, 1992, in awarding the sale and setting the terms of the Prior Bonds; (3) the tax increments (the "Tax Increment ") received by the City pursuant to the Tax Increment Pledge Agreement referred to in paragraph 24 of this Resolution, but only in such amounts as shall be necessary, together with other monies in the Debt Service Account and available for such purposes, to pay, when due, the principal of and interest on the Bonds; (4) all collections of any ad valorem taxes hereafter levied for the payment of the Bonds; (5) all investment earnings on funds held in the Debt Service Account; and (6) any amounts received by the City upon termination of the Refunding Account. The foregoing funds are hereby pledged to the Debt Service Account, but only in such amounts and at such times as may be necessary, together with other available funds therein (and the same shall be used solely), to pay the principal of and interest on the Bonds, when due. No portion of the proceeds of the Bonds shall be used directly or indirectly to acquire higher yielding investments or to replace funds which were used directly or indirectly to acquire higher yielding investments, except for an available and reasonable "temporary period" until such proceeds are needed for the purpose for which the Bonds were issued, and for any available "minor portion." To this effect, any proceeds of the Bonds and any sums from time to time held in the Refunding Account and Debt Service Account (or any other City account which will be used to pay principal and interest to become due on the ' Bonds) in excess of amounts which under then - applicable federal arbitrage regulations may be invested without regard to yield shall not be invested at a yield in excess of the applicable yield restrictions imposed by the arbitrage regulations on such investments after taking into account any applicable "temporary periods" or "minor portion" made available under the federal arbitrage regulations. In addition, the proceeds of the Bonds and money in the Fund shall not be invested in obligations or deposits issued by, guaranteed by or insured by the United States or any agency or instrumentality thereof if and to the extent that such investment would cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b) of the Internal Revenue Code of 1986, as amended, and regulations, rulings and decisions thereunder (the "Code "). 17. 1058 Debt Service Coverage. It is hereby determined that the Tax Increments will be in the principal amount of at least 208 of the cost of the Project being refinanced through the issuance of the Bonds and that the estimated collections of Tax Increments, together with the proceeds of any Definitive Bonds (as described in paragraph 4 of this Resolution) required to be issued pursuant to Minnesota Statutes, Section 469.178, Subdivision 5, will produce at least 58 in excess of the amount needed to meet, when due, the principal of and interest on the Bonds. The City Clerk is directed to file a certified copy of this Resolution with the office of Anoka County Property Records & Taxation and to obtain the certificate of said office required by Minnesota Statutes, Section 475.63. 18. General Obligation Pledge. 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 122 ' Page 19 -- Resolution No. 70 - 1995 funds in the Debt Service Account of amounts needed to make any such payment, when due, the Council shall levy ad valorem taxes on all taxable property in the City and /or issue Definitive Bonds in such amounts as may be necessary to rectify such deficiency. If the balance in the Debt Service Account is ever insufficient to pay all principal and interest then due on the Bonds, the deficiency shall be promptly paid out of any other funds of the City which are available for such purpose, and such other funds may be reimbursed with or without interest from the Debt Service Account when a sufficient balance is available therein. 19. Records and Certificates. The officers of the City are hereby authorized and directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality of the issuance of the Bonds, certified copies of all proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the City, and such other affidavits, certificates and information as are required to show the facts relating to the legality and marketability of the Bonds as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates and affidavits, including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein. ' 20. Negative Covenant as to Use of Project. The City hereby covenants not to use the proceeds of the Bonds or the Project or to cause or permit the same to be used, or to enter into any deferred payment arrangements for the cost of the Project, and the City represents that the proceeds of the Prior Bonds were not used, in such a manner as to cause the Bonds or the Prior Bonds to be "private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code. 21. Tax - Exempt Status o t e Bonds :_Rebate: Certain Previous 1995 Bond Issues of the City. The City shall comply with requirements necessary under the Code to establish and maintain the exclusion from gross income under Section 103 of the Code of the interest on the Bonds, including without limitation (1) requirements relating to temporary periods for investments, (2) limitations on amounts invested at a yield greater than the yield on the Bonds, and (3) the rebate of excess investment earnings to the United States to the extent that the Bonds do not qualify in whole or in part for an exception thereto. In view of the provisions of Section 148(f)(4)(D)(v) of the Code, the City does not expect to qualify the Bonds as exempt from arbitrage rebate on the basis of the $5,000,000 "small issuer" exception thereto. The City is aware that the proceeds of the Bonds may qualify, in whole or in part, for other arbitrage rebate exceptions, e.g., the 6 month expenditure exception, and the officers of the City have been and are hereby authorized to make such available elections in connection therewith which they may deem desirable or necessary. 22. Designation of Oualified Tax - Exempt Obli at ons. In order to qualify the Bonds as "qualified tax - exempt obligations" within the meaning of Section 123 Page 20 -- Resolution No. 70 - 1995 265(b)(3) of the Code, the City hereby makes the following factual statements and representations: (a) the Bonds are issued after August 7, 1986; (b) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; (c)v the City hereby designates the Bonds as "qualified tax - exempt obligations" for purposes of Section 265(b)(3) of the Code; (d) the reasonably anticipated amount of tax - exempt obligations (other than private activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will be issued by the City (and all entities subordinate to, or treated as one issuer with, the City) during calendar year 1995 will not exceed $10,000,000; and (e) not more than $10,000,000 of obligations issued or to be issued by the City during calendar year 1995 have been designated for purposes of Section 265(b)(3) of the Code. The City shall use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designation made by this paragraph. 23. Defeasance. When any obligation of a Bond has been discharged as provided in this paragraph, all pledges, covenants and other rights granted by this Resolution to the registered owner of that Bond (with respect to the obligation thereof so defeased) shall, to the extent permitted by law, cease. The City may at any time discharge any or all of such obligation(s) with respect to any Bond, subject to the provisions of law now or hereafter authorizing or regulating such action, by depositing irrevocably in escrow, with a suitable institution qualified by law as an escrow agent for this purpose, cash or securities which are backed by the full faith and credit of the United States of America, bearing interest payable at such times and at such rates and maturing on such dates and in such amounts as shall be required and sufficient, subject to sale and /or reinvestment in like securities, to pay said obligation(s), which may include any interest payment on such Bond and /or principal amount due thereon at a stated maturity (or if irrevocable provision shall have been made for permitted prior redemption of such principal amount, at such earlier redemption date). 24. Tax Increment Pledge Agreement: Special Tax Covenants. The Council hereby approves and authorizes the Mayor and City Manager to execute that certain Tax Increment Pledge Agreement, dated as of November 1, 1995, respecting the Bonds, which Agreement has been presented to the Council for its consideration and which is between the City and the Housing and ' Redevelopment Authority in and for the City of Fridley, Minnesota, with such modifications, if any, as such officers shall approve, as evidenced by their execution and delivery thereof. The Tax Increment Pledge Agreement, as 124 ' Page 21 -- Resolution No. 70 - 1995 actually executed and delivered in connection with the issuance of the Bonds, is hereby made fully a part of this Resolution to the same extent as though set forth in full herein at this point, and the representations and covenants made therein with respect to the tax exemption of the interest of the Bonds are hereby ratified and confirmed by the City for the benefit of the owners of the Bonds. 25. Continuing Disclosure Undertaking. The Council hereby acknowledges that the Bonds are subject to continuing disclosure requirements under Rule 15c2- 12(b)(5) (the "Rule ") of the Securities and Exchange Commission. Consequently, on the date of actual issuance and delivery of the Bonds, the City will execute and deliver a Continuing Disclosure Undertaking (the "Undertaking ") whereunder the City will covenant to provide, or cause to be provided, annual financial information, including audited financial statements of the City, and notices of certain material events, as specified in the Undertaking. The proposed form of the Undertaking which has been submitted to the City for the Council's consideration is hereby approved, and the officers of the City are hereby authorized to execute and deliver that Undertaking in the proposed form or in such final form thereof reflecting such modifications thereof as are consistent with the Rule, requested by the original purchaser of the Bonds and acceptable to the City officials who shall execute the Undertaking (which consent shall be conclusively evidenced by their execution and delivery thereof). The Undertaking, as so executed and delivered by the City, shall be as much a part of this Resolution as if set forth in full herein and shall be for the benefit of the owners from time to time of the Bonds. 26. Severability. If any section, paragraph or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Resolution. 27. Headings. Headings in this Resolution are included for convenience of reference only and shall not limit or define the meaning of any provision hereof. PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 23RD DAY OF OCTOBER, 1995. WILLIAM J. E - MAYOR ATTEST: G WILLIAM A. CHAMPA - CITY LERK