HomeMy WebLinkAbout05-065 - ADMIN Resolution - City Council - 2005/05/02RESOLUTION NO. 05-065
A RESOLUTION AWARDING THE SALE OF $2,370,000
GENERAL OBLIGATION TAX INCREMENT REFUNDING BONDS,
SERIES 2005B;
FIXING THEIR FORM AND SPECIFICATIONS;
DIRECTING THEIR EXECUTION AND DELIVERY;
PROVIDING FOR THEIR PAYMENT; PROVIDING FOR THE
ESCROWING AND INVESTMENT OF THE PROCEEDS THEREOF;
AND PROVIDING FOR THE REDEMPTION OF
BONDS REFUNDED THEREBY
BE IT RESOLVED By the City Council of the City of St. Louis Park, Hennepin County,
Minnesota (the "City") as follows.
Section 1 Sale of Bonds.
1.01. It is hereby determined that:
(a) the City has duly established the following project areas and tax increment
districts: (i) Excelsior Boulevard Redevelopment Project, (ii) Oak Park Village Redevelopment
Project; and (iii) the Highway 7 Development Distnct (collectively referred to herein as the
"Distncts") pursuant to Minnesota Statutes, Sections 469.001 through 469 047, Chapter 472A,
and Sections 469.174 to 469.179 and predecessor statutes (Act);
(b) the control, authonty and operation of the Distncts were transferred to the St.
Louis Park Economic Development Authonty (Authority) by Resolution No. 88-134 of the City,
pursuant to Minnesota Statutes, Section 469.094; and
(c) by Resolution No. 90-4 of the Authority and Resolution No 90-29 of the City, the
geographical areas of the project areas associated with the Districts were expanded and joined
(such expanded coterminous area is referred to herein as the "Project Area"); and
(d) the City is authorized by Section 469.178 of the TIF Act to issue and sell its
general obligations to pay all or a portion of the public development and redevelopment costs
(Costs) related to the Project Area as identified in the redevelopment plan and program and tax
increment financing plan (Plans) for the Districts;
(e) the City is authorized by the provisions of Minnesota Statutes, Chapter 475
(the "Act") and Section 475.67, Subdivision 13 of the Act and its home rule charter to issue and
sell its general obligation bonds to refund outstanding bonds when determined by the City
Council to be necessary and desirable;
(f) it is necessary and desirable that the City issue approximately $2,470,000 General
Obligation Tax Increment Refunding Bonds, Senes 2005B (the "Bonds") to refund in advance of
maturity and at their redemption date, certain outstanding general obligations of the City; the
proceeds of which have been
(g) the outstanding bonds to be refunded (the "Refunded Bonds") consist of the
$7,000,000 General Obligation Tax Increment Bonds, Senes 1997A, dated May 1, 1997, of
which $2,435,000 in pnncipal amount is callable on February 1, 2006.
Resolution No. 05-065 -2-
(h) the Mayor and City Manager are authonzed and directed to execute a Tax
Increment Pledge Agreement between the City and the Authonty (Pledge Agreement) in
substantially the form on file in City Hall, pursuant to which the Authonty pledges certain
Available Tax Increment (as defined in the Pledge Agreement) to pay principal of and interest on
the Bonds.
1.02. The proposal of Legg Mason Wood Walker, Inc. (the "Purchaser") to purchase
$2,370,000 General Obligation Tax Increment Refunding Bonds, Senes 2005B (the "Bonds") of the
City described in the Official Terms of Proposal thereof is determined to be a reasonable offer and
is accepted, the proposal being to purchase the Bonds at a pnce of $2,493,914.54 plus accrued
interest to date of delivery, for Bonds beanng interest as follows:
Year
2007
2008
True interest cost: 2.9692%
Interest Rate
5.00%
5.00%
Year
2009
Interest Rate
5.00%
1.03. The sum of $14,220 being the amount proposed by the Purchaser in excess of
$2,355,780 is credited to the Escrow Account hereinafter created, or designated to pay costs of
issuance of the Bonds, as may be recommended by the financial advisors to the City. The City
Finance Director is directed to retain the good faith check of the Purchaser, pending completion of
the sale of the Bonds, and to return the good faith checks of the unsuccessful proposers forthwith
The Mayor and City Manager are directed to execute a contract with the Purchaser on behalf of the
City.
1.04. The City will forthwith issue and sell the Bonds pursuant to Minnesota Statutes,
Chapter 475 (the "Act") in the total pnncipal amount of $2,370,000, onginally dated May 25, 2005,
in the denomination of $5,000 each or any integral multiple thereof, numbered No. R-1, upward,
bearing interest as above set forth, and matunng senally on February 1 without option of pnor
payment in the years and amounts as follows:
Year Amount Year Amount
2007 $755,000 2009 $825,000
2008 790,000
Section 2. Registration and Payment.
2.01. Registered Form. The Bonds will be issued only in fully registered form. The
interest thereon and, upon surrender of each Bond, the pnncipal amount thereof, is payable by check
or draft issued by the Registrar descnbed herein.
2.02. Dates; Interest Payment Dates. Each Bond will be dated as of the last interest
payment date preceding the date of authentication to which interest on the Bond has been paid or
made available for payment, unless (i) the date of authentication is an interest payment date to
which interest has been paid or made available for payment, in which case the Bond will be dated as
of the date of authentication, or (ii) the date of authentication is prior to the first interest payment
date, in which case the Bond will be dated as of the date of onginal issue. The interest on the Bonds
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Resolution No. 05-065 -3-
is payable on February 1 and August 1 of each year, commencing February 1, 2006, to the
registered owners of record as of the close of business on the fifteenth day of the immediately
preceding month, whether or not that day is a business day
2.03. Registration. The City appoints the City Finance Director as Bond Registrar,
transfer agent and paying agent (the "Registrar"). The effect of registration and the nghts and duties
of the City and the Registrar with respect thereto are as follows:
(a) Register. The Registrar will keep a bond register in which the Registrar
provides for the registration of ownership of Bonds and the registration of transfers and
exchanges of Bonds entitled to be registered, transferred or exchanged.
(b) Transfer of Bonds. Upon surrender for transfer of a Bond duly endorsed by
the registered owner thereof or accompanied by a written instrument of transfer, in form
satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney
duly authonzed by the registered owner in wnting, the Registrar will deliver, in the name of
the designated transferee or transferees, one or more new Bonds of a like aggregate pnncipal
amount and matunty, as requested by the transferor. The Registrar may, however, close the
books for registration of any transfer after the fifteenth day of the month preceding each
interest payment date and until that interest payment date.
(c) Exchange of Bonds. When Bonds are surrendered by the registered owner
for exchange the Registrar will deliver one or more new Bonds of a like aggregate principal
amount and maturity as requested by the registered owner or the owner's attorney in writing.
(d) Cancellation. Bonds surrendered upon transfer or exchange will be promptly
cancelled by the Registrar and thereafter disposed of as directed by the City.
(e) Improper or Unauthorized Transfer. When a Bond is presented to the
Registrar for transfer, the Registrar may refuse to transfer the Bond until the Registrar is
satisfied that the endorsement on the Bond or separate instrument of transfer is valid and
genuine and that the requested transfer is legally authonzed. The Registrar will incur no
liability for the refusal, in good faith, to make transfers which it, in its judgment, deems
improper or unauthonzed.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in
whose name a Bond is registered in the bond register as the absolute owner of the Bond,
whether the Bond is overdue or not, for the purpose of receiving payment of, or on account
of, the pnncipal of and interest on the Bond and for all other purposes, and payments so
made to a registered owner or upon the owner's order will be valid and effectual to satisfy
and discharge the liability upon the Bond to the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. The Registrar may impose a charge upon the
owner thereof for a transfer or exchange of Bonds sufficient to reimburse the Registrar for
any tax, fee or other governmental charge required to be paid with respect to the transfer or
exchange.
Resolution No. 05-065 -4-
(h) Mutilated, Lost, Stolen or Destroyed Bonds. If a Bond becomes mutilated or
is destroyed, stolen or lost, the Registrar will deliver a new Bond of like amount, number,
maturity date and tenor in exchange and substitution for and upon cancellation of the
mutilated Bond or in lieu of and in substitution for any Bond destroyed, stolen or lost, upon
the payment of the reasonable expenses and charges of the Registrar in connection
therewith; and, in the case of a Bond destroyed, stolen or lost, upon filing with the Registrar
of evidence satisfactory to it that the Bond was destroyed, stolen or lost, and of the
ownership thereof, and upon furnishing to the Registrar an appropnate bond or indemnity in
form, substance and amount satisfactory to it and as provided by law, in which both the City
and the Registrar must be named as obligees. Bonds so surrendered to the Registrar will be
cancelled by the Registrar and evidence of such cancellation must be given to the City. If
the mutilated, destroyed, stolen or lost Bond has already matured or been called for
redemption in accordance with its terms it is not necessary to issue a new Bond pnor to
payment.
2.04. Execution and Delivery. The Bonds will be prepared under the direction of the City
Manager and executed on behalf of the City by the signatures of the Mayor and the City Manager,
provided that those signatures may be pnnted, engraved or lithographed facsimiles of the originals.
If an officer whose signature or a facsimile of whose signature appears on the Bonds ceases to be
such officer before the delivery of a Bond, that signature or facsimile will nevertheless be valid and
sufficient for all purposes, the same as if the officer had remained in office until delivery. When the
Bonds have been so prepared and executed, the City Manager will deliver the same to the Purchaser
upon payment of the purchase pnce in accordance with the contract of sale heretofore made and
executed, and the Purchaser is not obligated to see to the application of the purchase pnce.
2.06. Temporary Bonds. The City may elect to deliver in lieu of pnnted definitive Bonds
one or more typewntten temporary Bonds in substantially the form set forth in Section 3 with such
changes as may be necessary to reflect more than one maturity in a single temporary bond. Upon
the execution and delivery of definitive Bonds the temporary Bonds will be exchanged therefor and
cancelled.
Section 3. Form of Bond.
3.01. The Bonds will be pnnted or typewritten in substantially the following form:
No. R- UNITED STATES OF AMERICA $
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF ST. LOUIS PARK
GENERAL OBLIGATION TAX INCREMENT REFUNDING BOND, SERIES 2005B
Rate Matunty Date of
Original Issue
, 20_ May 25, 2005
Registered Owner: Cede & Co.
CUSIP
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Resolution No. 05-065 ' -5-
The City of St. Louis Park, Minnesota, a duly organized and existing municipal corporation
in Hennepin County, Minnesota (the "City"), acknowledges itself to be indebted and for value
received promises to pay to the Registered Owner specified above or registered assigns, the
principal sum of $2,370,000 on the matunty date specified above without option of pnor payment,
with interest thereon from the date hereof at the annual rate specified above, payable February 1 and
August 1 in each year, commencing February 1, 2006, to the person in whose name this Bond is
registered at the close of business on the fifteenth day (whether or not a business day) of the
immediately preceding month. The interest hereon and, upbn presentation and surrender hereof, the
pnncipal hereof are payable in lawful money of the United States of Amenca by check or draft by
the Finance Director of the City of St. Louis Park, Minnesota, as Bond Registrar, Paying Agent and
Transfer Agent, or its designated successor under the Resolution described herein. For the prompt
and full payment of such pnncipal and interest as the same respectively become due, the full faith
and credit and taxing powers of the City have been and are hereby irrevocably pledged.
The City Council has designated the issue of Bonds of which this Bond forms a part as
"qualified tax exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue
Code of 1986, as amended (the "Code") relating to disallowance of interest expense for financial
institutions and within the $10 million limit allowed by the Code for the calendar year of issue.
This Bond is one of an issue in the aggregate principal amount of $2,370,000 all of like
onginal issue date and tenor, except as to number, matunty date, and interest rate, all issued
.: pursuant to a resolution adopted by the City Council on May 2, 2005 (the "Resolution"), for the
purpose of providing money to refund in advance of matunty and on the Redemption Date, as
defined in the Resolution, a portion of certain general obligation bonds of the City, pursuant to and
in full conformity with the home rule charter of the City and the Constitution and laws of the State
of Minnesota, including Minnesota Statutes, Sections 475.67, Subdivision 13. The interest hereon
is payable until the Redemption Date, pnmanly out of the Escrow Account and Debt Service
Account in the City's Tax Increment Refunding Bonds, Senes 2005B Debt Service Fund and after
the Redemption Date from tax increments resulting from increases in the taxable value of real
property in certain tax increment financing distncts in the City as set forth in the Resolution to
which reference is made for a full statement of rights and powers thereby conferred. The full faith
and credit of the City are irrevocably pledged for payment of this Bond and the City Council has
obligated itself to levy ad valorem taxes on all taxable property in the City in the event of any
deficiency in tax increments pledged, which taxes may be levied without limitation as to rate or
amount. The Bonds of this series are issued only as fully registered Bonds in denominations of
$5,000 or any integral multiple thereof of single matunties.
As provided in the Resolution and subject to certain limitations set forth therein, this Bond is
transferable upon the books of the City at the pnncipal office of the Bond Registrar, by the
registered owner hereof in person or by the owner's attorney duly authorized in wnting, upon
surrender hereof together with a wntten instrument of transfer satisfactory to the Bond Registrar,
duly executed by the registered owner or the owner's attorney; and may also be surrendered in
exchange for Bonds of other authonzed denominations. Upon such transfer or exchange the City
will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of
the same aggregate principal amount, bearing interest at the same rate and matunng on the same
date, subject to reimbursement for any tax, fee or governmental charge required to be paid with
respect to such transfer or exchange.
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Resolution No. 05-065 - -6- .4, ,
The City and the Bond Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of
receiving payment and for all other purposes, and neither the City nor the Bond Registrar will be
affected by any notice to the contrary.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts,
conditions and things required by the home rule charter of the City and the Constitution and laws of
the State of Minnesota to be done, to exist, to happen and to be performed preliminary to and in the
issuance of this Bond in order to make it a valid and binding general obligation of the City in
accordance with its terms, have been done, do exist, have happened and have been performed as so
required, and that the issuance of this Bond does not cause the indebtedness of the City to exceed
any constitutional, statutory or charter limitation of indebtedness.
This Bond is not valid or obligatory for any purpose or entitled to any security or benefit
under the Resolution until the Certificate of Authentication hereon has been executed by the Bond
Registrar by manual signature of one of its authonzed representatives.
IN WITNESS WHEREOF, the City of St. Louis Park, Hennepin County, Minnesota, by its
City Council, has caused this Bond to be executed on its behalf by the facsimile or manual
signatures of the Mayor and City Manager and has caused this Bond to be dated as of the date set
forth below.
Dated:
CITY OF ST. LOUIS PARK,
MINNESOTA
(Facsimile) (Facsimile)
City Manager Mayor
The following abbreviations, when used in the inscnption on the face of this Bond, will be
construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants
in common
UNIF GIFT MIN ACT Custodian
(Cust) (Minor)
TEN ENT -- as tenants under Uniform Gifts or
by entireties Transfers to Minors
JT TEN -- as Joint tenants with
nght of survivorship and
not as tenants in common
Act... .....
(State)
Additional abbreviations may also be used though not in the above list.
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Resolution No. 05-065 -7-
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond and all nghts thereunder, and
does hereby irrevocably constitute and appoint attorney to transfer the said Bond
on the books kept for registration of the within Bond, with full power of substitution in the
premises
Dated:
Notice: The assignor's signature to this assignment must correspond with the name
as it appears upon the face of the within Bond in every particular, without
alteration or any change whatever.
Signature Guaranteed:
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the
Secunties Transfer Agent Medallion Program ("STAMP"), the Stock Exchange Medallion Program
("SEMP"), the New York Stock Exchange, Inc. Medallion Signatures Program ("MSP") or other
such "signature guarantee program" as may be determined by the Registrar in addition to, or in
substitution for, STAMP, SEMP or MSP, all in accordance with the Securities Exchange Act of
1934, as amended.
The Bond Registrar will not effect transfer of this Bond unless the information concerning
the assignee requested below is provided.
Name and Address:
(Include information for all point owners if this
Bond is held by joint account.)
Please insert social secunty or other
identifying number of assignee
PROVISIONS AS TO REGISTRATION
®The ownership of the pnncipal of and interest on the within Bond has been registered on the
books of the Registrar in the name of the person last noted below.
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Resolution No. 05-065 -8-
Date of Registration
Signature of
Registered Owner City Finance Director
Cede & Co.
Federal ID #13-2555119
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3.02. The City Manager is authorized and directed to obtain a copy of the proposed
approving legal opinion of Kennedy & Graven, Chartered, Minneapolis, Minnesota, which is to be
complete except as to dating thereof and cause the opinion to be panted on or accompany each
Bond.
Section 4. Bonds; Security; Escrow.
4.01. Funds and Accounts. For the convenience and proper administration of the moneys
to be borrowed and repaid on the Bonds and the Refunded Bonds (as defined in the resolution
providing for the issuance and sale of the Bonds), and to provide adequate and specific secunty for
the Purchaser and holders from time to time of the Bonds and Refunded Bonds, there is hereby
created a special fund to be designated the Tax Increment Refunding Bonds, Senes 2005B Debt
Service Fund (the "Fund") to be administered and maintained by the Finance Director as a
bookkeeping account separate and apart from all other funds maintained in the official financial
records of the City. The Fund will be maintained in the manner herein specified until all of the
Refunded Bonds have been paid and until all of the Bonds and the interest thereon will have been
fully paid. There will be maintained in the Fund two separate accounts, to be designated the Escrow
Account and Debt Service Account.
(a) Escrow Account. The Escrow Account will be maintained as an Escrow
Account (the "Escrow Account") with U.S. Bank National Association, in St. Paul,
Minnesota, which is a suitable financial institution within the State, whose deposits are
insured by the Federal Deposit Insurance Corporation, whose combined capital and surplus
is not less than $500,000 and said financial institution is hereby designated escrow agent
(the "Escrow Agent") for the Escrow Account. All proceeds of the sale of the Bonds will be
received by the Escrow Agent and applied to fund the Escrow Account or to pay costs of
issuing the Bonds. Proceeds of the Bonds not used to pay costs of issuance are hereby
irrevocably pledged and appropnated to the Escrow Account, together with all investment
earnings thereon. The Escrow Account will be invested in secunties matunng or callable at
the option of the holder on such dates and bearing interest at such rates as will be required to
provide sufficient funds, together with any cash or other funds retained in the Escrow
Account, to pay when due the interest to accrue on each Bond to and including February 1,
2006 (the "Redemption Date"), and to pay when due on the Redemption Date the pnncipal
amount of each of the Refunded Bonds then outstanding. From the Escrow Account there
will be paid (i) all interest paid on, or to be paid on, or to accrue on, the Bonds to and
including the Redemption Date, and (rr) the principal of the Refunded Bonds due by reason
of redemption on the Redemption Date. The Escrow Account will be irrevocably
appropnated to the payment of the pnncipal of and interest on the Bonds until the proceeds
of the Bonds therein are applied to prepayment of the Refunded Bonds. The moneys in the
Escrow Account will be used solely for the purposes herein set forth and for no other
purpose, except that any surplus in the Escrow Account may be remitted to the City, all in
accordance with the Escrow Agreement (hereafter defined) by and between the City and the
Escrow Agent. Any moneys remitted to the City upon termination of the Escrow
Agreement will be deposited in the Debt Service Account.
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Resolution No. 05-065 -9-
(b) Debt Service Account. To the Debt Service Account there is hereby pledged
and irrevocably appropnated and there will be credited. (i) any balance remitted to the City
upon the termination of the Escrow Agreement; (ii) any balance remaining on February 2,
2006, in the Debt Service Fund created by the City Council resolution authonzing the
issuance and sale of the Refunded Bonds (the "Pnor Resolution"), (iii) any collections of all
taxes hereafter levied for the payment of the Bonds and interest thereon; (iv) all investment
earnings on funds in the Debt Service Account; (v)tafter the Redemption Date, all Available
Tax Increment (as defined in the Pledge Agreement) received by the City from the
Authority pursuant to the Pledge Agreement; (vi) accrued interest (if any) received upon
delivery of the Bonds, to the extent not required to fund the Escrow Account; and (vii) any
and all other moneys which are properly available and are appropnated by the City Council
to the Debt Service Account. The amount of any surplus remaining in the Debt Service
Account when the Bonds and interest thereon are paid will be used as provided in Section
475.61, Subdivision 4 of the Act.
4.02. Findings. It is hereby found and determined that based upon information presently
available from the City's financial advisers, the issuance of the Bonds will result in a reduction of
debt service cost to the City on the Refunded Bonds, such that the present value of such debt service
or interest cost savings (the "Reduction") is 3 254% of the debt service on the Refunded Bonds.
The Reduction, after the inclusion of all authonzed expenses of refunding in the computation of the
effective interest rate on the Bonds, is adequate to authorize the issuance of the Bonds as provided
by Minnesota Statutes, Section 475 67, Subdivisions 12 and 13.
4.03. The moneys in the Debt Service Account will be used solely to pay the pnncipal of
and interest on the Bonds or any other bonds hereafter issued and made payable from the Fund. No
portion of the proceeds of the Bonds will 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 (i) for a reasonable temporary penod until such proceeds are needed for the
purpose for which the Bonds were issued, and (ii) in addition to the above, in an amount not greater
than the lesser of five percent of the proceeds of the Bonds or $100,000. To this effect, any
proceeds of the Bonds and any sums from time to time held in the Fund (or any other City account
which will be used to pay pnncipal and interest to become due on the Bonds) in excess of amounts
which under the applicable federal arbitrage regulations may be invested without regard as to yield
will 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 penods or minor
portion made available under the federal arbitrage regulations. In addition, the proceeds of the
Bonds and money in the Fund will 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 (the "Code").
4.04. General Obligation Pledge. For the prompt and full payment of the pnncipal and
interest on the Bonds, as the same respectively become due, the full faith, credit and taxing powers
of the City will be and are hereby irrevocably pledged. If the balance in the Escrow Account or
Debt Service Account is ever insufficient to pay all pnncipal and interest then due on the Bonds and
any other bonds payable therefrom, the deficiency will be promptly paid out of monies in the
general fund of the City which are available for such purpose, and such general fund may be
reimbursed with or without interest from the Escrow Account or Debt Service Account when a
sufficient balance is available therein.
Resolution No. 05-065 -10-
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4.05. It is determined that estimated collection of tax increments for the payment of
principal and interest on the Bonds after the Redemption Date will produce at least five percent in
excess of the amount needed to meet when due, the pnncipal and interest payments on the Bonds
matunng after the Redemption Date, and that no tax levy is needed at this time.
4.06. Filing. The City Manager is authorized and directed to file a certified copy of this
resolution with the Taxpayer Services Division Manager of Hennepin County and to obtain the
certificate required by Section 475.63 of the Act.
Section 5. Refunding; Findings; Redemption of Refunded Bonds.
5.01. As of the date of delivery of and payment for the Bonds proceeds of the Bonds in the
amount of $2,467,323.00 including amounts used to pay costs of issuance) (the "Proceeds"), are
hereby pledged and appropnated and will be deposited in the Escrow Account.
5.02. It is hereby found and determined that the Proceeds available and appropnated to the
Escrow Account will be sufficient, together with the permitted earnings on the investment of the
Escrow Account, to pay pnncipal of and interest on the Bonds through the Redemption Date, and to
pay at maturity or redemption all of the pnncipal of and redemption premium (if any) on the
Refunded Bonds.
5.03. Secunties purchased from the monies in the Escrow Account will be limited to
secunties specified in Section 475.67, Subdivision 8 of the Act. Ehlers & Associates, Inc., as agent
for the City of St. Louis Park is hereby authorized and directed to purchase for and on behalf of the
City of St. Louis Park and in its name, appropnate secunties to fund the Escrow Account. Upon the
issuance and delivery of the Bonds, the secunties so purchased will be deposited with the Escrow
Agent and held pursuant to the terms of the Escrow Agreement and the Resolution.
5.04. The Refunded Bonds matunng on February 1, 2006 and thereafter will be redeemed
and prepaid on the Redemption Date. The Refunded Bonds will be redeemed and prepaid in
accordance with their terms and in accordance with the terms and conditions set forth in the form of
Notice of Call for Redemption attached hereto as Attachment A which terms and conditions are
hereby approved and incorporated herein by reference. The Registrar for the Refunded Bonds is
authonzed and directed to send a copy of the Notice of Redemption to each registered holder of the
Refunded Bonds.
5.05. Escrow Agreement. On or prior to the delivery of the Refunding Bonds, the Mayor
and the City Manager are hereby authorized and directed to execute on behalf of the City an escrow
agreement (the "Escrow Agreement") with the Escrow Agent in substantially the form now on file
with the City Manager. All essential terms and conditions of the Escrow Agreement including
payment by the City of reasonable charges for the services of the Escrow Agent, are hereby
approved and adopted and made a part of this resolution, and the City covenants that it will
promptly enforce all provisions thereof in the event of default thereunder by the Escrow Agent.
Section 6. Authentication of Transcript
6.01. The officers of the City are authorized and directed to prepare and furnish to the
Purchaser and to the attorneys approving the Bonds, certified copies of proceedings and records of
the City relating to the Bonds and to the financial condition and affairs of the City, and such other
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Resolution No. 05-065 -11-
certificates, affidavits and transcnpts as may be required to show the facts within their knowledge or
as shown by the books and records in their custody and under their control, relating to the validity
and marketability of the Bonds, and such instruments, including any heretofore furnished, will be
deemed representations of the City as to the facts stated therein.
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6.02. The Mayor, City Manager and Finance Director are hereby authorized and directed
to certify that they have examined the Official Statement prepared and circulated in connection with
the issuance and sale of the Bonds and that to the best of their knowledge and belief the Official
Statement is a complete and accurate representation of the facts and representations made therein as
of the date of the Official Statement.
Section 7. Tax Covenant.
7.01. The City covenants and agrees with the holders from time to time of the Bonds that
it will not take or permit to be taken by any of its officers, employees or agents any action which
would cause the interest on the Bonds to become subject to taxation under the Internal Revenue
Code of 1986, as amended (the "Code"), and the Treasury Regulations promulgated thereunder, in
effect at the time of such actions, and that it will take or cause its officers, employees or agents to
take, all affirmative action within its power that may be necessary to ensure that such interest will
not become subject to taxation under the Code and applicable Treasury Regulations, as presently
existing or as hereafter amended and made applicable to the Bonds.
7 02 The City will comply with requirements necessary under the Code to establish and
maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the
Code, including without limitation requirements relating to temporary penods for investments,
limitations on amounts invested at a yield greater than the yield on the Bonds, and the rebate of
excess investment earnings to the United States
7.03. The City further covenants not to use the proceeds of the Bonds or to cause or permit
them or any of them to be used, in such a manner as to cause the Bonds to be "private activity
bonds" within the meaning of Sections 103 and 141 through 150 of the Code.
7.04. In order to qualify the Bonds as "qualified tax-exempt obligations" within the
meaning of Section 265(b)(3) of the Code, the City makes the following factual statements and
representations:
(a) the Bonds are not "pnvate activity bonds" as defined in Section 141 of the
Code;
(b) the City hereby designates the Bonds as "qualified tax-exempt obligations"
for purposes of Section 265(b)(3) of the Code;
(c) the reasonably anticipated amount of tax-exempt obligations (other than
pnvate activity bonds, that are not qualified 501(c)(3) bonds) which will be issued by the
City (and all subordinate entities of the City) during calendar year 2005 will not exceed
$10,000,000; and
(d) not more than $10,000,000 of obligations issued by the City dunng calendar
year 2005 have been designated for purposes of Section 265(b)(3) of the Code.
Resolution No. 05-065
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7.05. The City will use its best efforts to comply with any federal procedural requirements
which may apply in order to effectuate the designations made by this section.
Section 8. Book -Entry System; Limited Obligation of City.
8.01. The Bonds will be initially issued in the form of a separate single typewntten or
printed fully registered Bond for each of the matunties set forth in Section 1.03 hereof. Upon initial
issuance, the ownership of each such Bond will be registered in the registration books kept by the
Bond Registrar in the name of Cede & Co., as nominee for The Depository Trust Company, New
York, New York, and its successors and assigns ("DTC"). Except as provided in this section, all of
the outstanding Bonds will be registered in the registration books kept by the Bond Registrar in the
name of Cede & Co., as nominee of DTC.
8.02. With respect to Bonds registered in the registration books kept by the Bond
Registrar in the name of Cede & Co., as nominee of DTC, the City, the Bond Registrar and the
Paying Agent will have no responsibility or obligation to any broker dealers, banks and other
financial institutions from time to time for which DTC holds Bonds as secunties depository
(the "Participants") or to any other person on behalf of which a Participant holds an interest in the
Bonds, including but not limited to any responsibility or obligation with respect to (i) the accuracy
of the records of DTC, Cede & Co. or any Participant with respect to any ownership interest in the
Bonds, (n) the delivery to any Participant or any other person (other than a registered owner of
Bonds, as shown by the registration books kept by the Bond Registrar), of any notice with respect to
the Bonds, including any notice of redemption, or (iii) the payment to any Participant or any other
person, other than a registered owner of Bonds, of any amount with respect to pnncipal of,
premium, if any, or interest on the Bonds. The City, the Bond Registrar and the Paying Agent may
treat and consider the person in whose name each Bond is registered in the registration books kept
by the Bond Registrar as the holder and absolute owner of such Bond for the purpose of payment of
principal, premium and interest with respect to such Bond, for the purpose of registenng transfers
with respect to such Bonds, and for all other purposes. The Paying Agent will pay all pnncipal of,
premium, if any, and interest on the Bonds only to or on the order of the respective registered
owners, as shown in the registration books kept by the Bond Registrar, and all such payments will
be valid and effectual to fully satisfy and discharge the City's obligations with respect to payment of
principal of, premium, if any, or interest on the Bonds to the extent of the sum or sums so paid. No
person other than a registered owner of Bonds, as shown in the registration books kept by the Bond
Registrar, will receive a certificated Bond evidencing the obligation of this resolution.
Upon delivery by DTC to the City Manager of a wntten notice to the effect that DTC has
determined to substitute a new nominee in place of Cede & Co., the words "Cede & Co.," will refer
to such new nominee of DTC; and upon receipt of such a notice, the City Manager will promptly
deliver a copy of the same to the Bond Registrar and Paying Agent.
8.03. Representation Letter. The City has heretofore executed and delivered to DTC a
Blanket Issuer Letter of Representations (the "Representation Letter") which will govern payment
of pnncipal of, premium, if any, and interest on the Bonds and notices with respect to the Bonds.
Any Paying Agent or Bond Registrar subsequently appointed by the City with respect to the Bonds
will agree to take all action necessary for all representations of the City in the Representation letter
with respect to the Bond Registrar and Paying Agent, respectively, to be complied with at all times.
Resolution No 05-065 -13-
8.04. Transfers Outside Book -Entry System. In the event the City, by resolution of the
City Council, determines that it is in the best interests of the persons having beneficial interest, in
the Bonds that they be able to obtain Bond certificates, the City will notify DTC, whereupon DTC
will notify the Participants, of the availability through DTC of Bond certificates. In such event the
City will issue, transfer and exchange Bond certificates as requested by DTC and any other
registered owners in accordance with the provisions of this Resolution. DTC may determine to
discontinue providing its services with respect to the Bonds at any time by giving notice to the City
and discharging its responsibilities with respect thereto under applicable law. In such event, if no
successor securities depository is appointed, the City will issue and the Bond Registrar will
authenticate Bond certificates in accordance with this resolution and the provisions hereof will
apply to the transfer, exchange and method of payment thereof.
8.05. Payments to Cede & Co. Notwithstanding any other provision of this Resolution to
the contrary, so long as a Bond is registered in the name of Cede & Co., as nominee of DTC,
payments with respect to principal of, premium, if any, and interest on the Bond and notices with
respect to the Bond will be made and given, respectively in the manner provided in DTC's
Operational Arrangements, as set forth in the Representation Letter.
Section 9. Continuing Disclosure.
9.01 The City hereby covenants and agrees that it will comply with and carry out all of
the provisions of the Continuing Disclosure Certificate Notwithstanding any other provision of this
Resolution, failure of the City to comply with the Continuing Disclosure Certificate will not be
considered an event of default with respect to the Bonds, however, any Bondholder may take such
actions as may be necessary and appropnate, including seeking mandate or specific performance by
court order, to cause the City to comply with its obligations under this section.
9 02 "Continuing Disclosure Certificate" means that certain Continuing Disclosure
Certificate executed by the Mayor and City Manager and dated the date of issuance and delivery of
the Bonds, as onginally executed and as it may be amended from time to time in accordance with
the terms thereof.
Section 10. Defeasance. When all Bonds and all interest thereon, have been discharged as
provided in this section, all pledges, covenants and other nghts granted by this resolution to the
holders of the Bonds will cease, except that the pledge of the full faith and credit of the City for the
prompt and full payment of the principal of and interest on the Bonds will remain in full force and
effect. The City may discharge all Bonds which are due on any date by depositing with the
Registrar on or before that date a sum sufficient for the payment thereof in full. If any Bond should
not be paid when due, it may nevertheless be discharged by depositing with the Registrar a sum
sufficient for the payment thereof in full with interest accrued to the date of such deposit.
The motion for the adoption of the foregoing resolution was duly seconded by Member
Sanger, and upon vote being taken thereon, the following voted in favor thereof:
Jacobs, Basill, Finkelstein, Omodt, Sanger, Santa, Velick and the following voted against
the same: None
whereupon said resolution was declared duly passed and adopted.
Resolution
Reviewed fo
City Manager
Attest:
rze_....2,,J--____6—
Ci Clerk
261760V1 (SJB)
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Ilied by the CI Council May 2, 2005
May