HomeMy WebLinkAbout7. Awarding the Sale of $1,555,000 GO Improvement Bonds-Res. No. 7022 CITY OF SHAKOPEE
Memorandum
TO: Mayor and Council
Mark McNeill, City Administrator
FROM: Gregg Voxland, Finance Director
SUBJ: Awarding Sale of 2010A Improvement Bonds
DATE: July 15, 2010
Introduction
Council action is needed to award the sale of 2010A Improvement Bonds.
Background
The attached resolution was prepared by bond counsel to award the sale of improvement bonds series
2010A. The resolution needs to be adopted at the July 20th Council meeting to complete the bond sale.
It is expected that Springsted will bring completed resolutions to the council meeting.
Springsted will make the presentation to Council of the results of the sale.
Action
Offer Resolution No. 7022 A Resolution Awarding The Sale Of $1,555,000 General Obligation
Improvement Bonds Series 2010A, Fixing Their Form and Specifications; Directing Their Execution And
Delivery; and Providing For Their Payment, and move its adoption.
Gregg Voxland
Finance Director
H: \finance \cash \bonds\
RESOLUTION NO. 7022
A RESOLUTION AWARDING THE SALE OF GENERAL
OBLIGATION IMPROVEMENT BONDS, SERIES 2010A, IN THE
ORIGINAL AGGREGATE PRINCIPAL AMOUNT OF $1,555,000;
FIXING THEIR FORM AND SPECIFICATIONS; DIRECTING
THEIR EXECUTION AND DELIVERY; AND PROVIDING FOR
THEIR PAYMENT
BE IT RESOLVED By the City Council of the City of Shakopee, Minnesota (the "City "), as
follows:
Section 1. Sale of Bonds.
1.01 Authority. It is hereby determined that:
(a) The following assessable public improvements, including the 2009 Street
Reconstruction Project, the 2009 Bituminous Overlay Project, the Church Addition
Improvements, and the 2010 Street Reconstruction Project (collectively, the "Improvements "),
have been made, duly ordered or contracts let for the construction thereof pursuant to the
provisions of Minnesota Statutes, Chapters 429 and 475, as amended (collectively, the "Act ").
(b) Pursuant to a resolution adopted by the City Council of the City on July 6, 2010,
the City found it necessary and expedient to the sound financial management of the affairs of the
City to issue its General Obligation Improvement Bonds, Series 2010A (the `Bonds "), in the
aggregate principal amount of $1,555,000, pursuant to the Act to provide financing for the
Improvements.
(c) The City is authorized by Section 475.60, subdivision 2(9), of the Act to
negotiate the sale of the Bonds, it being determined that the City has retained an independent
financial advisor in connection with such sale. The actions of the City staff and the City's
financial advisor in negotiating the sale of the Bonds are ratified and confirmed in all aspects.
1.02. Award to the Purchaser and Interest Rates. The proposal of (the
"Purchaser ") to purchase the Bonds of the City is hereby found and determined to be a reasonable offer
and is hereby accepted, the proposal being to purchase the Bonds at a price of $ (par amount of
$1,555,000, [plus original issue premium of $ ,] [less original issue discount of $ ,] less
underwriter's discount of $ ), plus accrued interest to date of delivery, if any, for Bonds bearing
interest as follows:
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Year of Interest Year of Interest
Maturity Rate Maturity Rate
2011 % 2017
2012 2018
2013 2019
2014 2020
2015 2021
2016
True interest cost:
1.03. Purchase Contract. The sum of $ , being the amount proposed by the Purchaser
in excess of $1,539,450, shall be credited to the Debt Service Fund hereinafter created or deposited in the
Construction Fund hereinafter created, as determined by the City Finance Director in consultation with
the City's financial advisor. The City Finance Director is directed to deposit the good faith check or
deposit of the Purchaser, pending completion of the sale of the Bonds, and to return the good faith
deposits of the unsuccessful proposers. The Mayor and City Administrator are directed to execute a
contract with the Purchaser on behalf of the City.
1.04. Terms and Principal Amounts of the Bonds. The City will forthwith issue and sell the
Bonds pursuant to the Act in the total principal amount of $1,555,000, originally dated August 1, 2010, in
the denomination of $5,000 each or any integral multiple thereof, numbered No. R -1, upward, bearing
interest as above set forth, and maturing serially on February 1 in the years and amounts as follows:
Year Amount Year Amount
2011 $ 2017 $
2012 2018
2013 2019
2014 2020
2015 2021
2016
1.05. Optional Redemption. The City may elect on February 1, 2018, and on any day thereafter to
prepay Bonds due on or after February 1, 2019. Redemption may be in whole or in part and if in part, at the
option of the City and in such manner as the City will determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC (as defined in Section 7 hereof) of the particular amount of
such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such
maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such
maturity to be redeemed. Prepayments will be at a price of par plus accrued interest.
[1.06. Term Bonds; Mandatory Redemption. To be completed if Term Bonds are requested by
the Purchaser.]
Section 2. Registration and Payment.
2.01. Registered Form. The Bonds will be issued only in fully registered form. The interest
thereon and, upon surrender of each Bond, the principal amount thereof, is payable by check or draft
issued by the Registrar described herein.
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2.02. Dates; Interest Payment Dates. Each Bond will be dated as of the last interest payment
date preceding the date of authentication to which interest on the Bond has been paid or made available
for payment, unless (i) the date of authentication is an interest payment date to which interest has been
paid or made available for payment, in which case the Bond will be dated as of the date of
authentication, or (ii) the date of authentication is prior to the first interest payment date, in which case
the Bond will be dated as of the date of original issue. The interest on the Bonds is payable on
February 1 and August 1 of each year, commencing February 1, 2011, to the registered owners of record
thereof as of the close of business on the fifteenth day of the immediately preceding month, whether or
not that day is a business day.
2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating agent
and paying agent (the "Registrar "). The effect of registration and the rights and duties of the City and the
Registrar with respect thereto are as follows:
(a) Register. The Registrar must keep at its principal corporate trust office a bond
register in which the Registrar provides for the registration of ownership of Bonds and the
registration of transfers and exchanges of Bonds entitled to be registered, transferred or
exchanged.
(b) Transfer of Bonds. Upon surrender for transfer of a Bond duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form satisfactory
to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized
by the registered owner in writing, the Registrar will authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Bonds of a like aggregate principal amount
and maturity, as requested by the transferor. The Registrar may, however, close the books for
registration of any transfer after the fifteenth day of the month preceding each interest payment
date and until that interest payment date.
(c) Exchange of Bonds. When Bonds are surrendered by the registered owner for
exchange the Registrar will authenticate and deliver one or more new Bonds of a like aggregate
principal amount and maturity as requested by the registered owner or the owner's attorney in
writing.
(d) Cancellation. Bonds surrendered upon transfer or exchange will be promptly
cancelled by the Registrar and thereafter disposed of as directed by the City.
(e) Improper or Unauthorized Transfer. When a Bond is presented to the Registrar
for transfer, the Registrar may refuse to transfer the Bond until the Registrar is satisfied that the
endorsement on the Bond or separate instrument of transfer is valid and genuine and that the
requested transfer is legally authorized. The Registrar will incur no liability for the refusal, in
good faith, to make transfers which it, in its judgment, deems improper or unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in
whose name a Bond is registered in the bond register as the absolute owner of the Bond, whether
the Bond is overdue or not, for the purpose of receiving payment of, or on account of, the
principal of and interest on the Bond and for all other purposes and payments so made to
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.
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(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.
(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 a Bond destroyed, stolen or lost, upon the payment of the
reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a
Bond destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that the
Bond was destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the
Registrar of an appropriate bond or indemnity in form, substance and amount satisfactory to it
and as provided by law, in which both the City and the Registrar must be named as obligees.
Bonds so surrendered to the Registrar will be cancelled by the Registrar and evidence of such
cancellation must be given to the City. If the mutilated, destroyed, stolen or lost Bond has
already matured or been called for redemption in accordance with its terms it is not necessary to
issue a new Bond prior to payment.
(i) Redemption. In the event any of the Bonds are called for redemption, notice thereof
identifying the Bonds to be redeemed will be given by the Registrar by mailing a copy of the
redemption notice by first class mail (postage prepaid) to the registered owner of each Bond to be
redeemed at the address shown on the registration books kept by the Registrar and by publishing the
notice if required by law. Failure to give notice by publication or by mail to any registered owner, or
any defect therein, will not affect the validity of the proceedings for the redemption of Bonds. Bonds
so called for redemption will cease to bear interest after the specified redemption date, provided that
the funds for the redemption are on deposit with the place of payment at that time.
2.04. Appointment of Initial Registrar. The City appoints U.S. Bank National Association, St.
Paul, Minnesota, as the initial Registrar. The Mayor and the City Administrator are authorized to execute
and deliver, on behalf of the City, a contract with the Registrar. Upon merger or consolidation of the
Registrar with another corporation, if the resulting corporation is a bank or trust company authorized by
law to conduct such business, the resulting corporation is authorized to act as successor Registrar. The
City agrees to pay the reasonable and customary charges of the Registrar for the services perfoinied. The
City reserves the right to remove the Registrar upon 30 days' notice and upon the appointment of a
successor Registrar, in which event the predecessor Registrar must deliver all cash and Bonds in its
possession to the successor Registrar and must deliver the bond register to the successor Registrar. On or
before each principal or interest due date, without further order of this Council, the City Finance Director
must transmit to the Registrar monies sufficient for the payment of all principal and interest then due.
2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the direction
of the City Administrator and executed on behalf of the City by the signatures of the Mayor and the City
Administrator, provided that those signatures may be printed, engraved or lithographed facsimiles of the
originals. If an officer whose signature or a facsimile of whose signature appears on the Bonds ceases to
be such officer before the delivery of 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.
Notwithstanding such execution, a Bond will not be valid or obligatory for any purpose or entitled to any
security or benefit under this Resolution unless and until a certificate of authentication on the Bond has
been duly executed by the manual signature of an authorized representative of the Registrar. Certificates
of authentication on different Bonds need not be signed by the same representative. The executed
certificate of authentication on a Bond is conclusive evidence that it has been authenticated and delivered
under this Resolution. When the Bonds have been so prepared, executed and authenticated, the City
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Administrator will deliver the same to the Purchaser upon payment of the purchase price in accordance
with the contract of sale heretofore made and executed, and the Purchaser is not obligated to see to the
application of the purchase price.
2.06. Temporary Bonds. The City may elect to deliver in lieu of printed definitive Bonds one
or more typewritten temporary Bonds in substantially the form set forth in Section 3 with such changes as
may be necessary to reflect more than one maturity in a single temporary bond. Upon the execution and
delivery of definitive Bonds the temporary Bonds will be exchanged therefor and cancelled.
Section 3. Form of Bond.
3.01. Execution of the Bonds. The Bonds will be printed or typewritten in substantially the
form as attached hereto as EXHIBIT B.
3.02. Approving Legal Opinion. The City Administrator is 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 to cause the opinion to be printed on or accompany each
Bond.
Section 4. Payment; Security; Pledges and Covenants.
4.01. Debt Service Fund. The Bonds are payable from the Improvement Bonds, Series 2010A
Debt Service Fund (the "Debt Service Fund ") hereby created, and the proceeds of general taxes
hereinafter levied (the "Taxes ") and special assessments levied or to be levied (the "Assessments ") for the
Improvements described in Section 1.01 are hereby pledged to the Debt Service Fund. If a payment of
principal or interest on the Bonds becomes due when there is not sufficient money in the Debt Service
Fund to pay the same, the City Finance Director is directed to pay such principal or interest from the
general fund of the City, and the general fund will be reimbursed for those advances out of the proceeds
of Assessments and Taxes when collected. There is appropriated to the Debt Service Fund (i) capitalized
interest funded from Bond proceeds, if any; (ii) any amount over the minimum purchase price paid by the
Purchaser, to the extent designated for deposit in the Debt Service Fund in accordance with Section 1.03;
and (iii) the accrued interest paid by the Purchaser upon closing and delivery of the Bonds, if any.
4.02. Construction Fund. The proceeds of the Bonds, less the appropriations made in
Section 4.01, together with any other funds appropriated for the Improvements and Assessments and
Taxes collected during the construction of the Improvements, will be deposited in a separate construction
fund (the "Construction Fund ") to be used solely to defray expenses of the Improvements and the
payment of principal and interest on the Bonds prior to the completion and payment of all costs of the
Improvements. Any balance remaining in the Construction Fund after completion of the Improvements
may be used to pay the cost in whole or in part of any other improvement instituted under the Act under
the direction of the City Council. When the Improvements are completed and the cost thereof paid, the
Construction Fund is to be closed and subsequent collections of Assessments and Taxes for the
Improvements are to be deposited in the Debt Service Fund.
4.03. City Covenants. It is hereby determined that the Improvements will directly and
indirectly benefit abutting property, and the City hereby covenants with the holders from time to time of
the Bonds as follows:
(a) The City has caused or will cause the Assessments for the Improvements to be
promptly levied so that the first installment will be collectible not later than 2011 and will take all
steps necessary to assure prompt collection, and the levy of the Assessments is hereby authorized.
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The City Council will cause to be taken with due diligence all further actions that are required for
the construction of each Improvement financed wholly or partly from the proceeds of the Bonds,
and will take all further actions necessary for the final and valid levy of the Assessments and the
appropriation of any other funds needed to pay the Bonds and interest thereon when due.
(b) In the event of any current or anticipated deficiency in Assessments and Taxes,
the City Council will levy additional ad valorem taxes in the amount of the current or anticipated
deficiency.
(c) The City will keep complete and accurate books and records showing: receipts
and disbursements in connection with the Improvements, Assessments and Taxes levied therefor
and other funds appropriated for their payment, collections thereof and disbursements therefrom,
monies on hand and, the balance of unpaid Assessments.
(d) The City will cause its books and records to be audited at least annually and will
furnish copies of such audit reports to any interested person upon request.
(e) At least 20% of the cost of the assessable Improvements described herein will be
specially assessed against benefited properties.
4.04. Pledge of Tax Levy. For the purpose of paying the principal of and interest on the
Bonds, there is levied a direct annual irrepealable ad valorem tax upon all of the taxable property in the
City, which will be spread upon the tax rolls and collected with and as part of other general taxes of the
City. The Taxes will be credited to the Debt Service Fund above provided and will be in the years and
amounts described in EXHIBIT C.
4.05. Certification to County Auditor as to Debt Service Fund Amount. It is hereby determined
that the estimated collections of Assessments and the foregoing Taxes will produce at least five percent in
excess of the amount needed to meet when due the principal and interest payments on the Bonds. The tax
levy herein provided is irrepealable until all of the Bonds are paid, provided that at the time the City
makes its annual tax levies the City Administrator may certify to the County Auditor of Scott County,
Minnesota the amount available in the Debt Service Fund to pay principal and interest due during the
ensuing year, and the County Auditor will thereupon reduce the levy collectible during such year by the
amount so certified.
4.06. Certificates of County Auditor as to Registration. The City Administrator is authorized
and directed to file a certified copy of this resolution with the County Auditor and to obtain the certificate
required by Section 475.63 of the Act.
Section 5. Authentication of Transcript.
5.01. City Proceedings and Records. The officers of the City are authorized and directed to
prepare and furnish to the Purchaser and to the attorneys approving the Bonds, certified copies of
proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the
City, and such other certificates, affidavits and transcripts as may be required to show the facts within
their knowledge or as shown by the books and records in their custody and under their control, relating to
the validity and marketability of the Bonds, and such instruments, including any heretofore furnished,
may be deemed representations of the City as to the facts stated therein.
5.02. Certification as to Official Statement. The Mayor and City Administrator are authorized.
and directed to certify that they have examined the Official Statement prepared and circulated in
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connection with the issuance and sale of the Bonds and that to the best of their knowledge and belief the
Official Statement is a complete and accurate representation of the facts and representations made therein
as of the date of the Official Statement.
Section 6. Tax Covenant.
6.01. Tax- Exempt Bonds. The City covenants and agrees with the holders from time to time of
the Bonds that it will not take or permit to be taken by any of its officers, employees or agents any action
which would cause the interest on the Bonds to become subject to taxation under the Internal Revenue
Code of 1986, as amended (the "Code "), and the Treasury Regulations promulgated thereunder, in effect
at the time of such actions, and that it will take or cause its officers, employees or agents to take, all
affirmative action within its power that may be necessary to ensure that such interest will not become
subject to taxation under the Code and applicable Treasury Regulations, as presently existing or as
hereafter amended and made applicable to the Bonds.
6.02. No Rebate Required. (a) The City will comply with requirements necessary under the Code
to establish and maintain the exclusion from gross income of the interest on the Bonds under Section 103 of
the Code, including without limitation requirements relating to temporary periods for investments, limitations
on amounts invested at a yield greater than the yield on the Bonds, and the rebate of excess investment
earnings to the United States if the Bonds (together with other obligations reasonably expected to be issued in
calendar year 2010) exceed the small- issuer exception amount of $5,000,000.
(b) For purposes of qualifying for the small issuer exception to the federal arbitrage rebate
requirements, the City hereby fords, determines, and declares that the aggregate face amount of all
tax- exempt bonds (other than private activity bonds) issued by the City (and all subordinate entities of the
City) during the calendar year in which the Bonds are issued and outstanding at one time is not reasonably
expected to exceed $5,000,000, all within the meaning of Section 148(f)(4)(D) of the Code.
6.03. Not Private Activity Bonds. The City further covenants not to use the proceeds of the
Bonds or to cause or permit them or any of them to be used, in such a manner as to cause the Bonds to be
"private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code.
6.04. Qualified Tax - Exempt Obligations. In order to qualify the Bonds as "qualified
tax- exempt obligations" within the meaning of Section 265(b)(3) of the Code, the City makes the
following factual statements and representations:
(a) the Bonds are not "private activity bonds" as defined in Section 141 of the Code;
(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 any
private activity bonds) which will be issued by the City (and all subordinate entities of the City)
during calendar year 2010 will not exceed $30,000,000; and
(d) not more than $30,000,000 of obligations issued by the City during calendar year
2010 have been designated for purposes of Section 265(b)(3) of the Code.
6.05. Procedural Requirements. 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.
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Section 7. Book -Entry System; Limited Obligation of City.
7.01. DTC. The Bonds will be initially issued in the form of a separate single typewritten or
printed fully registered Bond for each of the maturities set forth in Section 1.04 hereof. Upon initial
issuance, the ownership of each Bond will be registered in the registration books kept by the 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 Registrar in the name of Cede & Co., as nominee of DTC.
7.02. Participants. With respect to Bonds registered in the registration books kept by the
Registrar in the name of Cede & Co., as nominee of DTC, the City, the Registrar and the Paying Agent
will have no responsibility or obligation to any broker dealers, banks and other financial institutions from
time to time for which DTC holds Bonds as securities depository (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, (ii) the delivery to any Participant or any
other person (other than a registered owner of Bonds, as shown by the registration books kept by the
Registrar) of any notice with respect to the Bonds, including any notice of redemption, or (iii) the
payment to any Participant or any other person, other than a registered owner of Bonds, of any amount
with respect to principal of, premium, if any, or interest on the Bonds. The City, the 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 Registrar as the holder and absolute owner of such Bond for the purpose of payment of
principal, premium and interest with respect to such Bond, for the purpose of registering transfers with
respect to such Bonds, and for all other purposes. The Paying Agent will pay all principal of, premium, if
any, and interest on the Bonds only to or on the order of the respective registered owners, as shown in the
registration books kept by the 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 Registrar, will receive a certificated Bond evidencing the
obligation of this resolution. Upon delivery by DTC to the City Administrator of a written notice to the
effect that DTC has determined to substitute a new nominee in place of Cede & Co., the words "Cede &
Co." will refer to such new nominee of DTC; and upon receipt of such a notice, the City Administrator
will promptly deliver a copy of the same to the Registrar and Paying Agent.
7.03. Representation Letter. The City has heretofore executed and delivered to DTC a Blanket
Issuer Letter of Representations (the "Representation Letter ") which shall govern payment of principal of,
premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any Paying Agent or
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 Registrar and
Paying Agent, respectively, to be complied with at all times.
7.04. Transfers Outside Book -Entry System. In the event the City, by resolution of the City
Council, determines that it is in the best interests of the persons having beneficial interests in the Bonds
that they be able to obtain Bond 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 Registrar will authenticate Bond certificates in
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accordance with this resolution and the provisions hereof will apply to the transfer, exchange and method
of payment thereof.
7.05. Payments to Cede & Co. Notwithstanding any other provision of this Resolution to the
contrary, so long as a Bond is registered in the name of Cede & Co., as nominee 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 8. Continuing Disclosure.
8.01. City Compliance with Provisions of Continuing Disclosure Certificate. 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 is not to be considered an event of default with respect
to the Bonds; however, any Bondholder may take such actions as may be necessary and appropriate,
including seeking mandate or specific performance by court order, to cause the City to comply with its
obligations under this section.
8.02. Execution of Continuing Disclosure Certificate. "Continuing Disclosure Certificate"
means that certain Continuing Disclosure Certificate executed by the Mayor and City Administrator and
dated the date of issuance and delivery of the Bonds, as originally executed and as it may be amended
from time to time in accordance with the terms thereof.
Section 9. Defeasance. When all Bonds and all interest thereon have been discharged as
provided in this section, all pledges, covenants and other rights 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.
Adopted in adjourned regular session of the City Council of the City of Shakopee held this 20 day
of July, 2010
Mayor of the City of Shakopee
ATTEST:
City Clerk
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EXHIBIT B
FORM OF BOND
No. R- $
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF SCOTT
CITY OF SHAKOPEE
GENERAL OBLIGATION IMPROVEMENT BOND
SERIES 2010A
Date of
Rate Maturity Original Issue CUSIP
February 1, 20_ August 1, 2010
Registered Owner: Cede & Co.
The City of Shakopee, Minnesota, a duly organized and existing municipal corporation in Scott
County, Minnesota (the "City "), acknowledges itself to be indebted and for value received hereby
promises to pay to the Registered Owner specified above or registered assigns, the principal sum of
$ on the maturity date specified above, with interest thereon from the date hereof at the
annual rate specified above, payable February 1 and August 1 in each year, commencing
February 1, 2011, to the person in whose name this Bond is registered at the close of business on the
fifteenth day (whether or not a business day) of the immediately preceding month. The interest hereon
and, upon presentation and surrender hereof, the principal hereof are payable in lawful money of the
United States of America by check or draft by U.S. Bank National Association, St. Paul, Minnesota, as
Bond Registrar, Paying Agent, Transfer Agent and Authenticating Agent, or its designated successor
under the Resolution described herein. For the prompt and full payment of such principal and interest as
the same respectively become due, the full faith and credit and taxing powers of the City have been and
are hereby irrevocably pledged.
The City may elect on February 1, 2018, and on any day thereafter to prepay Bonds due on or after
February 1, 2019. Redemption may be in whole or in part and if in part, at the option of the City and in such
manner as the City will determine. If less than all Bonds of a maturity are called for redemption, the City will
notify The Depository Trust Company ( "DTC ") of the particular amount of such maturity to be prepaid.
DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each
participant will then select by lot the beneficial ownership interests in such maturity to be redeemed.
Prepayments will be at a price of par plus accrued interest.
The City Council has designated the issue of Bonds of which this Bond forms a part as "qualified
tax - exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986,
as amended (the "Code ") relating to disallowance of interest expense for financial institutions and within
the $30 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 $1,555,000 all of like original
issue date and tenor, except as to number, maturity date, and interest rate, all issued pursuant to a
resolution adopted by the City Council on July 20, 2010 (the "Resolution "), for the purpose of providing
B -1
money to defray the expenses incurred and to be incurred in making local improvements, pursuant to and
in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes,
Chapters 429 and 475, as amended, and the principal hereof and interest hereon are payable in part from
special assessments against property specially benefited by local improvements and in part from ad
valorem taxes for the City's share of the cost of the improvements, 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 additional ad valorem taxes on all taxable property in the City in the event of any deficiency in
special assessments and taxes pledged, which additional taxes may be levied without limitation as to rate
or amount. The Bonds of this series are issued only as fully registered Bonds in denominations of $5,000
or any integral multiple thereof of single maturities.
As provided in the Resolution and subject to certain limitations set forth therein, this Bond is
transferable upon the books of the City at the principal office of the Bond Registrar, by the registered
owner hereof in person or by the owner's attorney duly authorized in writing, upon surrender hereof
together with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the
registered owner or the owner's attorney; and may also be surrendered in exchange for Bonds of other
authorized denominations. Upon such transfer or exchange the City will cause a new Bond or Bonds to
be issued in the name of the transferee or registered owner, of the same aggregate principal amount,
bearing interest at the same rate and maturing on the same date, subject to reimbursement for any tax, fee
or governmental charge required to be paid with respect to such transfer or exchange.
The City and the Bond Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is 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 Constitution and laws of the State of Minnesota, to be done, to exist,
to happen and to be performed preliminary to and in the issuance of this Bond in order to make it a valid
and binding general obligation of the City in accordance with its terms, have been done, do exist, have
happened and have been performed as so required, and that the issuance of this Bond does not cause the
indebtedness of the City to exceed any constitutional or statutory limitation of indebtedness.
This Bond is not valid or obligatory for any purpose or entitled to any security or benefit under
the Resolution until the Certificate of Authentication hereon has been executed by the Bond Registrar by
manual signature of one of its authorized representatives.
IN WITNESS WHEREOF, the City of Shakopee, Scott County, Minnesota, by its City Council,
has caused this Bond to be executed on its behalf by the facsimile or manual signatures of the Mayor and
City Administrator and has caused this Bond to be dated as of the date set forth below.
Dated: August 1, 2010
CITY OF SHAKOPEE, MINNESOTA
(Facsimile) (Facsimile)
Mayor City Administrator
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CERTIFICATE OF AUTHENTICATION
•
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
U.S. BANK NATIONAL ASSOCIATION
By
Authorized Representative
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this Bond, will be
construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants in common UNIF GIFT MIN ACT
Custodian
(Cust) (Minor)
TEN ENT -- as tenants by entireties under Uniform Gifts or Transfers to Minors
Act, State of
JT TEN -- as joint tenants with right of
survivorship and not as tenants in common
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 all rights thereunder, and does
hereby irrevocably constitute and appoint attorney to transfer the said
Bond on the books kept for registration of the within Bond, with full power of substitution in the
premises.
Dated:
Notice: The assignor's signature to this assignment must correspond with the name as it
appears upon the face of the within Bond in every particular, without alteration or
any change whatever.
Signature Guaranteed:
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NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the Securities
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 joint owners if this Bond is
held by joint account.)
Please insert social security or other identifying
number of assignee
PROVISIONS AS TO REGISTRATION
The ownership of the principal of and interest on the within Bond has been registered on the
books of the Registrar in the name of the person last noted below.
Signature of
Date of Registration Registered Owner Officer of Registrar
Cede & Co.
Federal ID #13- 2555119
•
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EXHIBIT C
TAX LEVY SCHEDULE
YEAR * TAX LEVY
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
* Year tax levy collected.
•
C -1
y.
Extract of Minutes of Meeting peywc.,..€9
of the City Council of the City of
Shakopee, Scott County, Minnesota
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of
Shakopee, Minnesota, was duly held in the City Hall in said City on Tuesday, July 20, 2010, commencing
at 7:00 P.M.
The following members were present:
and the following were absent:
* ** * ** * **
The Mayor announced that the next order of business was consideration of the proposals which
had been received for the purchase of the City's General Obligation Improvement Bonds, Series 2010A,
issued in the aggregate principal amount of $1,555,000.
The City Administrator presented a tabulation of the proposals that had been received in the
manner specified in the Terms of Proposal for the Bonds. The proposals were as set forth in EXHIBIT A
attached.
After due consideration of the proposals, Member then introduced the following
resolution and moved its adoption:
+r'
4) , ?� _ RESOLUTION NO.
A RESOLUTION AWARDING THE SALE OF GENERAL
OBLIGATION IMPROVEMENT BONDS, SERIES 2010A, IN THE
ORIGINAL AGGREGATE PRINCIPAL AMOUNT OF $1,555,000;
FIXING THEIR FORM AND SPECIFICATIONS; DIRECTING
THEIR EXECUTION AND DELIVERY; AND PROVIDING FOR
THEIR PAYMENT
BE IT RESOLVED By the City Council of the City of Shakopee, Minnesota (the "City "), as
follows:
Section 1. Sale of Bonds.
1.01 Authority. It is hereby determined that:
(a) The following assessable public improvements, including the 2009 Street
Reconstruction Project, the 2009 Bituminous Overlay Project, the Church Addition
Improvements, and the 2010 Street Reconstruction Project (collectively, the "Improvements "),
have been made, duly ordered or contracts let for the construction thereof pursuant to the
provisions of Minnesota Statutes, Chapters 429 and 475, as amended (collectively, the "Act ").
(b) Pursuant to a resolution adopted by the City Council of the City on July 6, 2010,
the City found it necessary and expedient to the sound financial management of the affairs of the
City to issue its General Obligation Improvement Bonds, Series 2010A (the "Bonds "), in the
aggregate principal amount of $1,555,000, pursuant to the Act to provide financing for the
Improvements.
(c) The City is authorized by Section 475.60, subdivision 2(9), of the Act to
negotiate the sale of the Bonds, it being determined that the City has retained an independent
financial advisor in connection with such sale. The actions of the City staff and the City's
financial advisor in negotiating the sale of the Bonds are ratified and confirmed in all aspects.
1.02. Award to the Purchaser and Interest Rates. The proposal of United Bankers' Bank (the
"Purchaser ") to purchase the Bonds of the City is hereby found and determined to be a reasonable offer
and is hereby accepted, the proposal being to purchase the Bonds at a price of $1,546,576.25 (par amount
of $1,555,000, less underwriter's discount of $8,423.75), plus accrued interest to date of delivery, if any,
for Bonds bearing interest as follows:
Year of Interest Year of Interest
Maturity Rate Maturity Rate
2012* 0.500% 2017 2.100%
2013 0.750 2018 2.300
2014 1.000 2019 2.500
2015 1.400 2021* 2.900
2016 1.750
* Term Bonds
2
•
•
True interest cost: 2.1699834%
1.03. Purchase Contract. The sum of $7,126.25, being the amount proposed by the Purchaser in
excess of $1,539,450, shall be credited to the Debt Service Fund hereinafter created or deposited in the
Construction Fund hereinafter created, as determined by the City Finance Director in consultation with
the City's financial advisor. The City Finance Director is directed to deposit the good faith check or
deposit of the Purchaser, pending completion of the sale of the Bonds, and to return the good faith
deposits of the unsuccessful proposers. The Mayor and City Administrator are directed to execute a
contract with the Purchaser on behalf of the City.
1.04. Terms and Principal Amounts of the Bonds. The City will forthwith issue and sell the
Bonds pursuant to the Act in the total principal amount of $1,555,000, originally dated August 1, 2010, in
the denomination of $5,000 each or any integral multiple thereof, numbered No. R -1, upward, bearing
interest as above set forth, and maturing serially on February 1 in the years and amounts as follows:
Year Amount Year Amount
2012* $220,000 2017 $135,000
2013 185,000 2018 135,000
2014 185,000 2019 135,000
2015 190,000 2021* 235,000
2016 135,000
* Term Bonds
1.05. Optional Redemption. The City may elect on February 1, 2018, and on any day thereafter to
prepay Bonds due on or after February 1, 2019. Redemption may be in whole or in part and if in part, at the
option of the City and in such manner as the City will determine. If less than all Bonds of a maturity are
called for redemption, the City will notify DTC (as defined in Section 7 hereof) of the particular amount of
such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such
maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such
maturity to be redeemed. Prepayments will be at a price of par plus accrued interest.
1.06. Term Bonds; Mandatory Redemption. The Bonds maturing in the years 2011 and 2012
are subject to mandatory sinking fund redemption on February 1 of the following years in the following
principal amounts:
Year Principal Amount
2011 $ 30,000
2012 190,000*
* Maturity
3
The Bonds maturing in the years 2020 and 2021 are subject to mandatory sinking fund
redemption on February 1 of the following years in the following principal amounts:
Year Principal Amount
2020 $145,000
2021 90,000*
* Maturity
Section 2. Registration and Payment.
2.01. Registered Form. The Bonds will be issued only in fully registered form. The interest
thereon and, upon surrender of each Bond, the principal amount thereof, is payable by check or draft
issued by the Registrar described herein.
2.02. Dates: Interest Payment Dates. Each Bond will be dated as of the last interest payment
date preceding the date of authentication to which interest on the Bond has been paid or made available
for payment, unless (i) the date of authentication is an interest payment date to which interest has been
paid or made available for payment, in which case the Bond will be dated as of the date of
authentication, or (ii) the date of authentication is prior to the first interest payment date, in which case
the Bond will be dated as of the date of original issue. The interest on the Bonds is payable on
February 1 and August 1 of each year, commencing February 1, 2011, to the registered owners of record
thereof as of the close of business on the fifteenth day of the immediately preceding month, whether or
not that day is a business day.
2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating agent
and paying agent (the "Registrar "). The effect of registration and the rights and duties of the City and the
Registrar with respect thereto are as follows:
(a) Register. The Registrar must keep at its principal corporate trust office a bond
register in which the Registrar provides for the registration of ownership of Bonds and the
registration of transfers and exchanges of Bonds entitled to be registered, transferred or
exchanged.
(b) Transfer of Bonds. Upon surrender for transfer of a Bond duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form satisfactory
to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized
by the registered owner in writing, the Registrar will authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Bonds of a like aggregate principal amount
and maturity, as requested by the transferor. The Registrar may, however, close the books for
registration of any transfer after the fifteenth day of the month preceding each interest payment
date and until that interest payment date.
(c) Exchange of Bonds. When Bonds are surrendered by the registered owner for
exchange the Registrar will authenticate and deliver one or more new Bonds of a like aggregate
principal amount and maturity as requested by the registered owner or the owner's attorney in
writing.
(d) Cancellation. Bonds surrendered upon transfer or exchange will be promptly
cancelled by the Registrar and thereafter disposed of as directed by the City.
4
(e) Improper or Unauthorized Transfer. When a Bond is presented to the Registrar
for transfer, the Registrar may refuse to transfer the Bond until the Registrar is satisfied that the
endorsement on the Bond or separate instrument of transfer is valid and genuine and that the
requested transfer is legally authorized. The Registrar will incur no liability for the refusal, in
good faith, to make transfers which it, in its judgment, deems improper or unauthorized.
(0 Persons Deemed Owners. The City and the Registrar may treat the person in
whose name a Bond is registered in the bond register as the absolute owner of the Bond, whether
the Bond is overdue or not, for the purpose of receiving payment of, or on account of, the
principal of and interest on the Bond and for all other purposes and payments so made to
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.
(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 a Bond destroyed, stolen or lost, upon the payment of the
reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a
Bond destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that the
Bond was destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the
Registrar of an appropriate bond or indemnity in form, substance and amount satisfactory to it
and as provided by law, in which both the City and the Registrar must be named as obligees.
Bonds so surrendered to the Registrar will be cancelled by the Registrar and evidence of such
cancellation must be given to the City. If the mutilated, destroyed, stolen or lost Bond has
already matured or been called for redemption in accordance with its terms it is not necessary to
issue a new Bond prior to payment.
(i) Redemption. In the event any of the Bonds are called for redemption, notice thereof
identifying the Bonds to be redeemed will be given by the Registrar by mailing a copy of the
redemption notice by first class mail (postage prepaid) to the registered owner of each Bond to be
redeemed at the address shown on the registration books kept by the Registrar and by publishing the
notice if required by law. Failure to give notice by publication or by mail to any registered owner, or
any defect therein, will not affect the validity of the proceedings for the redemption of Bonds. Bonds
so called for redemption will cease to bear interest after the specified redemption date, provided that
the funds for the redemption are on deposit with the place of payment at that time.
2.04. Appointment of Initial Registrar. The City appoints U.S. Bank National Association,
St. Paul, Minnesota, as the initial Registrar. The Mayor and the City Administrator are authorized to
execute and deliver, on behalf of the City, a contract with the Registrar. Upon merger or consolidation of
the Registrar with another corporation, if the resulting corporation is a bank or trust company authorized
by law to conduct such business, the resulting corporation is authorized to act as successor Registrar. The
City agrees to pay the reasonable and customary charges of the Registrar for the services performed. The
City reserves the right to remove the Registrar upon 30 days' notice and upon the appointment of a
successor Registrar, in which event the predecessor Registrar must deliver all cash and Bonds in its
possession to the successor Registrar and must deliver the bond register to the successor Registrar. On or
5
before each principal or interest due date, without further order of this Council, the City Finance Director
must transmit to the Registrar monies sufficient for the payment of all principal and interest then due.
2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the direction
of the City Administrator and executed on behalf of the City by the signatures of the Mayor and the City
Administrator, provided that those signatures may be printed, engraved or lithographed facsimiles of the
originals. If an officer whose signature or a facsimile of whose signature appears on the Bonds ceases to
be such officer before the delivery of 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.
Notwithstanding such execution, a Bond will not be valid or obligatory for any purpose or entitled to any
security or benefit under this Resolution unless and until a certificate of authentication on the Bond has
been duly executed by the manual signature of an authorized representative of the Registrar. Certificates
of authentication on different Bonds need not be signed by the same representative. The executed
certificate of authentication on a Bond is conclusive evidence that it has been authenticated and delivered
under this Resolution. When the Bonds have been so prepared, executed and authenticated, the City
Administrator will deliver the same to the Purchaser upon payment of the purchase price in accordance
with the contract of sale heretofore made and executed, and the Purchaser is not obligated to see to the
application of the purchase price.
2.06. Temporary Bonds. The City may elect to deliver in lieu of printed definitive Bonds one
or more typewritten temporary Bonds in substantially the form set forth in Section 3 with such changes as
may be necessary to reflect more than one maturity in a single temporary bond. Upon the execution and
delivery of definitive Bonds the temporary Bonds will be exchanged therefor and cancelled.
Section 3. Form of Bond.
3.01. Execution of the Bonds. The Bonds will be printed or typewritten in substantially the
form as attached hereto as EXHIBIT B.
3.02. Approving Legal Opinion. The City Administrator is 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 to cause the opinion to be printed on or accompany each
Bond.
Section 4. Payment Security; Pledges and Covenants.
4.01. Debt Service Fund. The Bonds are payable from the Improvement Bonds, Series 2010A
Debt Service Fund (the "Debt Service Fund ") hereby created, and the proceeds of general taxes
hereinafter levied (the "Taxes ") and special assessments levied or to be levied (the "Assessments ") for the
Improvements described in Section 1.01 are hereby pledged to the Debt Service Fund. If a payment of
principal or interest on the Bonds becomes due when there is not sufficient money in the Debt Service
Fund to pay the same, the City Finance Director is directed to pay such principal or interest from the
general fund of the City, and the general fund will be reimbursed for those advances out of the proceeds
of Assessments and Taxes when collected. There is appropriated to the Debt Service Fund (i) capitalized
interest funded from Bond proceeds, if any; (ii) any amount over the minimum purchase price paid by the
Purchaser, to the extent designated for deposit in the Debt Service Fund in accordance with Section 1.03;
and (iii) the accrued interest paid by the Purchaser upon closing and delivery of the Bonds, if any.
4.02. Construction Fund. The proceeds of the Bonds, less the appropriations made in
Section 4.01, together with any other funds appropriated for the Improvements and Assessments and .
Taxes collected during the construction of the Improvements, will be deposited in a separate construction
6
fund (the "Construction Fund ") to be used solely to defray expenses of the Improvements and the
payment of principal and interest on the Bonds prior to the completion and payment of all costs of the
Improvements. Any balance remaining in the Construction Fund after completion of the Improvements
may be used to pay the cost in whole or in part of any other improvement instituted under the Act under
the direction of the City Council. When the Improvements are completed and the cost thereof paid, the
Construction Fund is to be closed and subsequent collections of Assessments and Taxes for the
Improvements are to be deposited in the Debt Service Fund.
4.03. City Covenants. It is hereby determined that the Improvements will directly and
indirectly benefit abutting property, and the City hereby covenants with the holders from time to time of
the Bonds as follows:
(a) The City has caused or will cause the Assessments for the Improvements to be
promptly levied so that the first installment will be collectible not later than 2011 and will take all
steps necessary to assure prompt collection, and the levy of the Assessments is hereby authorized.
The City Council will cause to be taken with due diligence all further actions that are required for
the construction of each Improvement financed wholly or partly from the proceeds of the Bonds,
and will take all further actions necessary for the final and valid levy of the Assessments and the
appropriation of any other funds needed to pay the Bonds and interest thereon when due.
(b) In the event of any current or anticipated deficiency in Assessments and Taxes,
the City Council will levy additional ad valorem taxes in the amount of the current or anticipated
deficiency.
(c) The City will keep complete and accurate books and records showing: receipts
and disbursements in connection with the Improvements, Assessments and Taxes levied therefor
and other funds appropriated for their payment, collections thereof and disbursements therefrom,
monies on hand and, the balance of unpaid Assessments.
(d) The City will cause its books and records to be audited at least annually and will
furnish copies of such audit reports to any interested person upon request.
(e) At least 20% of the cost of the assessable Improvements described herein will be
specially assessed against benefited properties.
4.04. Pledge of Tax Levy. For the purpose of paying the principal of and interest on the
Bonds, there is levied a direct annual irrepealable ad valorem tax upon all of the taxable property in the
City, which will be spread upon the tax rolls and collected with and as part of other general taxes of the
City. The Taxes will be credited to the Debt Service Fund above provided and will be in the years and
amounts described in EXHIBIT C.
4.05. Certification to County Auditor as to Debt Service Fund Amount. It is hereby determined
that the estimated collections of Assessments and the foregoing Taxes will produce at least five percent in
excess of the amount needed to meet when due the principal and interest payments on the Bonds. The tax
levy herein provided is irrepealable until all of the Bonds are paid, provided that at the time the City
makes its annual tax levies the City Administrator may certify to the County Auditor of Scott County,
Minnesota the amount available in the Debt Service Fund to pay principal and interest due during the
ensuing year, and the County Auditor will thereupon reduce the levy collectible during such year by the
amount so certified.
7
4.06. Certificates of County Auditor as to Registration. The City Administrator is authorized
and directed to file a certified copy of this resolution with the County Auditor and to obtain the certificate
required by Section 475.63 of the Act.
Section 5. Authentication of Transcript.
5.01. City Proceedings and Records. The officers of the City are authorized and directed to
prepare and furnish to the Purchaser and to the attorneys approving the Bonds, certified copies of
proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the
City, and such other certificates, affidavits and transcripts as may be required to show the facts within
their knowledge or as shown by the books and records in their custody and under their control, relating to
the validity and marketability of the Bonds, and such instruments, including any heretofore furnished,
may be deemed representations of the City as to the facts stated therein.
5.02. Certification as to Official Statement. The Mayor and City Administrator are authorized
and directed to certify that they have examined the Official Statement prepared and circulated in
connection with the issuance and sale of the Bonds and that to the best of their knowledge and belief the
Official Statement is a complete and accurate representation of the facts and representations made therein
as of the date of the Official Statement.
Section 6. Tax Covenant.
6.01. Tax- Exempt Bonds. The City covenants and agrees with the holders from time to time of
the Bonds that it will not take or permit to be taken by any of its officers, employees or agents any action
which would cause the interest on the Bonds to become subject to taxation under the Internal Revenue
Code of 1986, as amended (the "Code "), and the Treasury Regulations promulgated thereunder, in effect
at the time of such actions, and that it will take or cause its officers, employees or agents to take, all
affirmative action within its power that may be necessary to ensure that such interest will not become
subject to taxation under the Code and applicable Treasury Regulations, as presently existing or as
hereafter amended and made applicable to the Bonds.
6.02. No Rebate Required. (a) The City will comply with requirements necessary under the Code
to establish and maintain the exclusion from gross income of the interest on the Bonds under Section 103 of
the Code, including without limitation requirements relating to temporary periods for investments, limitations
on amounts invested at a yield greater than the yield on the Bonds, and the rebate of excess investment
earnings to the United States if the Bonds (together with other obligations reasonably expected to be issued in
calendar year 2010) exceed the small- issuer exception amount of $5,000,000.
(b) For purposes of qualifying for the small issuer exception to the federal arbitrage rebate
requirements, the City hereby fmds, determines, and declares that the aggregate face amount of all
tax- exempt bonds (other than private activity bonds) issued by the City (and all subordinate entities of the
City) during the calendar year in which the Bonds are issued and outstanding at one time is not reasonably
expected to exceed $5,000,000, all within the meaning of Section 148(f)(4)(D) of the Code.
6.03. Not Private Activity Bonds. The City further covenants not to use the proceeds of the
Bonds or to cause or permit them or any of them to be used, in such a manner as to cause the Bonds to be
"private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code.
6.04. Qualified Tax- Exempt Obligations. 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:
8
(a) the Bonds are not "private 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 any
private activity bonds) which will be issued by the City (and all subordinate entities of the City)
during calendar year 2010 will not exceed $30,000,000; and
(d) not more than $30,000,000 of obligations issued by the City during calendar year
2010 have been designated for purposes of Section 265(b)(3) of the Code.
6.05. Procedural Requirements. The City will use its best efforts to comply with any federal
procedural requirements which may apply in order to effectuate the designations made by this section.
Section 7. Book -Entry System; Limited Obligation of City.
7.01. DTC. The Bonds will be initially issued in the form of a separate single typewritten or
printed fully registered Bond for each of the maturities set forth in Section 1.04 hereof. Upon initial -
issuance, the ownership of each Bond will be registered in the registration books kept by the 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 Registrar in the name of Cede & Co., as nominee of DTC.
7.02. Participants. With respect to Bonds registered in the registration books kept by the
Registrar in the name of Cede & Co., as nominee of DTC, the City, the Registrar and the Paying Agent
will have no responsibility or obligation to any broker dealers, banks and other financial institutions from
time to time for which DTC holds Bonds as securities depository (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, (ii) the delivery to any Participant or any
other person (other than a registered owner of Bonds, as shown by the registration books kept by the
Registrar) of any notice with respect to the Bonds, including any notice of redemption, or (iii) the
payment to any Participant or any other person, other than a registered owner of Bonds, of any amount
with respect to principal of, premium, if any, or interest on the Bonds. The City, the 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 Registrar as the holder and absolute owner of such Bond for the purpose of payment of
principal, premium and interest with respect to such Bond, for the purpose of registering transfers with
respect to such Bonds, and for all other purposes. The Paying Agent will pay all principal of, premium, if
any, and interest on the Bonds only to or on the order of the respective registered owners, as shown in the
registration books kept by the 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 Registrar, will receive a certificated Bond evidencing the
obligation of this resolution. Upon delivery by DTC to the City Administrator of a written notice to the
effect that DTC has determined to substitute a new nominee in place of Cede & Co., the words "Cede &
Co." will refer to such new nominee of DTC; and upon receipt of such a notice, the City Administrator
will promptly deliver a copy of the same to the Registrar and Paying Agent.
9
7.03. Representation Letter. The City has heretofore executed and delivered to DTC a Blanket
Issuer Letter of Representations (the "Representation Letter ") which shall govern payment of principal of,
premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any Paying Agent or
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 Registrar and
Paying Agent, respectively, to be complied with at all times.
7.04. Transfers Outside Book -Entry System. In the event the City, by resolution of the City
Council, determines that it is in the best interests of the persons having beneficial interests in the Bonds
that they be able to obtain Bond 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 Registrar will authenticate Bond certificates in
accordance with this resolution and the provisions hereof will apply to the transfer, exchange and method
of payment thereof.
7.05. Payments to Cede & Co. Notwithstanding any other provision of this Resolution to the
contrary, so long as a Bond is registered in the name of Cede & Co., as nominee 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 8. Continuing Disclosure.
8.01. City Compliance with Provisions of Continuing Disclosure Certificate. 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 is not to be considered an event of default with respect
to the Bonds; however, any Bondholder may take such actions as may be necessary and appropriate,
including seeking mandate or specific performance by court order, to cause the City to comply with its
obligations under this section.
8.02. Execution of Continuing Disclosure Certificate. "Continuing Disclosure Certificate"
means that certain Continuing Disclosure Certificate executed by the Mayor and City Administrator and
dated the date of issuance and delivery of the Bonds, as originally executed and as it may be amended
from time to time in accordance with the terms thereof.
Section 9. Defeasance. When all Bonds and all interest thereon have been discharged as
provided in this section, all pledges, covenants and other rights 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.
10
The motion for the adoption of the foregoing resolution was duly seconded by Member
and upon vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted.
11
EXHIBIT B
FORM OF BOND
No. R- $
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF SCOTT
CITY OF SHAKOPEE
GENERAL OBLIGATION IMPROVEMENT BOND
SERIES 2010A
Date of
Rate Maturity Original Issue CUSIP
February 1, 20 August 1, 2010
Registered Owner: Cede & Co.
The City of Shakopee, Minnesota, a duly organized and existing municipal corporation in Scott
County, Minnesota (the "City "), acknowledges itself to be indebted and for value received hereby
promises to pay to the Registered Owner specified above or registered assigns, the principal sum of
$ on the maturity date specified above, with interest thereon from the date hereof at the
annual rate specified above, payable February 1 and August 1 in each year, commencing
February 1, 2011, to the person in whose name this Bond is registered at the close of business on the
fifteenth day (whether or not a business day) of the immediately preceding month. The interest hereon
and, upon presentation and surrender hereof, the principal hereof are payable in lawful money of the
United States of America by check or draft by U.S. Bank National Association, St. Paul, Minnesota, as
Bond Registrar, Paying Agent, Transfer Agent and Authenticating Agent, or its designated successor
under the Resolution described herein. For the prompt and full payment of such principal and interest as
the same respectively become due, the full faith and credit and taxing powers of the City have been and
are hereby irrevocably pledged.
The City may elect on February 1, 2018, and on any day thereafter to prepay Bonds due on or after
February 1, 2019. Redemption may be in whole or in part and if in part, at the option of the City and in such
manner as the City will determine. If less than all Bonds of a maturity are called for redemption, the City will
notify The Depository Trust Company ( "DTC ") of the particular amount of such maturity to be prepaid.
DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each
participant will then select by lot the beneficial ownership interests in such maturity to be redeemed.
Prepayments will be at a price of par plus accrued interest.
The City Council has designated the issue of Bonds of which this Bond forms a part as "qualified
tax- exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986,
as amended (the "Code ") relating to disallowance of interest expense for financial institutions and within
the $30 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 $1,555,000 all of like original
issue date and tenor, except as to number, maturity date, and interest rate, all issued pursuant to a
resolution adopted by the City Council on July 20, 2010 (the "Resolution "), for the purpose of providing
B -1
money to defray the expenses incurred and to be incurred in making local improvements, pursuant to and
in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes,
Chapters 429 and 475, as amended, and the principal hereof and interest hereon are payable in part from
special assessments against property specially benefited by local improvements and in part from ad
valorem taxes for the City's share of the cost of the improvements, 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 additional ad valorem taxes on all taxable property in the City in the event of any deficiency in
special assessments and taxes pledged, which additional taxes may be levied without limitation as to rate
or amount. The Bonds of this series are issued only as fully registered Bonds in denominations of $5,000
or any integral multiple thereof of single maturities.
As provided in the Resolution and subject to certain limitations set forth therein, this Bond is
transferable upon the books of the City at the principal office of the Bond Registrar, by the registered
owner hereof in person or by the owner's attorney duly authorized in writing, upon surrender hereof
together with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the
registered owner or the owner's attorney; and may also be surrendered in exchange for Bonds of other
authorized denominations. Upon such transfer or exchange the City will cause a new Bond or Bonds to
be issued in the name of the transferee or registered owner, of the same aggregate principal amount,
bearing interest at the same rate and maturing on the same date, subject to reimbursement for any tax, fee
or governmental charge required to be paid with respect to such transfer or exchange.
The City and the Bond Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is 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 Constitution and laws of the State of Minnesota, to be done, to exist,
to happen and to be performed preliminary to and in the issuance of this Bond in order to make it a valid
and binding general obligation of the City in accordance with its terms, have been done, do exist, have
happened and have been performed as so required, and that the issuance of this Bond does not cause the
indebtedness of the City to exceed any constitutional or statutory limitation of indebtedness.
This Bond is not valid or obligatory for any purpose or entitled to any security or benefit under
the Resolution until the Certificate of Authentication hereon has been executed by the Bond Registrar by
manual signature of one of its authorized representatives.
IN WITNESS WHEREOF, the City of Shakopee, Scott County, Minnesota, by its City Council,
has caused this Bond to be executed on its behalf by the facsimile or manual signatures of the Mayor and
City Administrator and has caused this Bond to be dated as of the date set forth below.
Dated: August 1, 2010
CITY OF SHAKOPEE, MINNESOTA
(Facsimile) (Facsimile)
Mayor City Administrator
B -2
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
U.S. BANK NATIONAL ASSOCIATION
By
Authorized Representative
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this Bond, will be
construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants in common UNIF GIFT MIN ACT
Custodian
(Cust) (Minor)
TEN ENT -- as tenants by entireties under Uniform Gifts or Transfers to Minors
Act, State of
JT TEN -- as joint tenants with right of
survivorship and not as tenants in common
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 all rights thereunder, and does
hereby irrevocably constitute and appoint attorney to transfer the said
Bond on the books kept for registration of the within Bond, with full power of substitution in the
premises.
Dated:
Notice: The assignor's signature to this assignment must correspond with the name as it
appears upon the face of the within Bond in every particular, without alteration or
any change whatever.
Signature Guaranteed:
B -3
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the Securities
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 joint owners if this Bond is
held by joint account.)
Please insert social security or other identifying
number of assignee
PROVISIONS AS TO REGISTRATION
The ownership of the principal of and interest on the within Bond has been registered on the
books of the Registrar in the name of the person last noted below.
Signature of
Date of Registration Registered Owner Officer of Registrar
Cede & Co.
Federal ID #13 2555119
B -4
EXHIBIT C
TAX LEVY SCHEDULE
YEAR * TAX LEVY
2011 $137,440.00
2012 136,507.42
2013 13 8,234.93
2014 144,727.79
2015 108,492.13
2016 108,066.50
2017 107,144.75
2018 105,939.50
2019 114,950.75
2020 69,940.50
* Year tax levy collected.
C -1
STATE OF MINNESOTA )
COUNTY OF SCOTT ) SS.
CITY OF SHAKOPEE
I, the undersigned, being the duly qualified and acting City Clerk of the City of Shakopee,
Minnesota (the "City "), do hereby certify that I have carefully compared the attached and foregoing
extract of minutes of a regular meeting of the City Council of the City held on July 20, 2010, with the
original minutes on file in my office and the extract is a full, true and correct copy of the minutes insofar
as they relate to the issuance and sale of the City's General Obligation Improvement Bonds,
Series 2010A, in the original aggregate principal amount of $1,555,000.
WITNESS My hand officially as such City Clerk and the corporate seal of the City this
day of , 2010.
City Clerk
Shakopee, Minnesota
(SEAL)
STATE OF MINNESOTA CERTIFICATE OF COUNTY
AUDITOR AS TO TAX LEVY
COUNTY OF SCOTT AND REGISTRATION
I, the undersigned County Auditor of Scott County, Minnesota, hereby certify that a certified
copy of a resolution adopted by the governing body of the City of Shakopee, Minnesota (the "City "), on
July 20, 2010, levying taxes for the payment of the City's General Obligation Improvement Bonds,
Series 2010A, issued in the original aggregate principal amount of $1,555,000, dated August 1, 2010, has
been filed in my office and said bonds have been entered on the register of obligations in my office and
that such tax has been levied as required by law.
WITNESS My hand and official seal this day of , 2010.
County Auditor
Scott County, Minnesota
(SEAL)
Deputy
SH155 -232 (JAE)
371466v2
Springsted Incorporated
380 Jackson Street, Suite 300
Saint Paul, MN 55101 -2887
Springsted Tel: 651 - 223 -3000
Fax: 651- 223 -3002
Email: advisors @springsted.com
www.springsted.com
$1,555,000*
CITY OF SHAKOPEE, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2010A
(BOOK ENTRY ONLY)
AWARD: UNITED BANKERS' BANK
SALE: July 20, 2010 Moody's Rating: Aa2
Interest Net Interest True Interest
Bidder Rates Price Cost Rate
UNITED BANKERS' BANK 0.50% 2011 -2012 $1,546,576.25 $182,586.25 2.1699 %
0.75% 2013
1.00% 2014
1.40% 2015
1.75% 2016
2.10% 2017
2.30% 2018
2.50% 2019
2.90% 2020 -2021
ROBERT W. BAIRD & COMPANY, 2.00% 2011 -2015 $1,592,775.85 $186,886.65 2.1854%
INCORPORATED 2.50% 2016
C.L. KING & ASSOCIATES 3.00% 2017 -2021
DAVENPORT & COMPANY LLC
LOOP CAPITAL MARKETS, LLC
KILDARE CAPITAL
SAMCO CAPITAL MARKETS, INC.
EDWARD D. JONES & COMPANY
WEDBUSH MORGAN SECURITIES
UMB BANK, N.A. 0.65% 2011 -2012 $1,543,804.00 $186,091.00 2.2161%
0.90% 2013
1.15% 2014
1.45% 2015
1.75% 2016
2.10% 2017
2.30% 2018
2.50% 2019
2.70% 2020
3.00% 2021
(Continued)
Public Sector Advisors
Interest Net Interest True Interest
Bidder Rates Price Cost Rate
CRONIN &COMPANY, INC. 2.00% 2011 -2016 $1,580,307.95 $191,254.55 2.2480%
RBC CAPITAL MARKETS CORPORATION 2.50% 2017
3.00% 2018 -2021
PIPER JAFFRAY & CO. 2.00% 2011 -2015 $1,581,132.70 $192,286.05 2.2596%
2.25% 2016
2.50% 2017
3.00% 2018 -2021
UBS FINANCIAL SERVICES INC. 2.00% 2011 -2015 $1,577,807.15 $197,467.85 2.3243%
2.50% 2016 -2017
3.00% 2018 -2021
NORTHLAND SECURITIES 2.00% 2011 -2016 $1,556,817.60 $195,661.15 2.3271%
2.20% 2017
2.35% 2018
2.50% 2019
2.70% 2020
3.00% 2021
These Bonds are being reoffered at Par.
BBI: 4.37%
Average Maturity: 5.381 Years
* Subsequent to bid opening, the issue size was not changed.