3. G.O. Bonds Series 1996A.MEMORANDUM
CITY OF 3
CHANE AISSEN
690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317
(612) 937 -1900 • FAX (612) 937 -5739
TO: Mayor and City Council
Update- Dave MacGillivrary from
Spri i,;st .d will be at Monday's meeting
to review the bids received for this bond
sale.
FROM: Don Ashworth, City Manager
DWA (4 -2 -96)
DATE: March 20, 1996
SUBJ: General Obligation Improvement Refunding Bonds, Series 1996A
The proposed refunding (Bonds of 1987) is the
1995. The anticipated savings of the proposed
MacGillivrary is in the process of running new
The drop in the stock market did have a ripple
neither Dave nor I anticipate a major change re
last week.
issue that was considered at the end of
iding is approximately $200,000. Dave
bers as this memorandum is being written.
t into the municipal bond market; however,
izing the stabilization that has occurred in the
Standard and Poor should see the proposed refunding as being positive in that it eliminates
approximately $1 million in existing debt. As no new debt is being created, the proposed
refunding does not affect our overall bonding limits nor does" it trigger arbitrage reporting/
calculations. The anticipated savings of $200,000 is a net number in that all attorney costs,
consultant fees, bonding costs, etc., have been included.
Authorizing
Refunding F
as "a potential date of award for the
Recommendations
For
City of Chanhassen, Minnesota
$900,000
General Obligation Improvement Refunding Bonds,
Series 1996A
Presented to:
Mayor Donald J. Chmiel
Members, City Council
Mr. Donald W. Ashworth, City Manager
Ms. Pam Snell, Finance Director
City of Chanhassen
690 Coulter Drive
Chanhassen, MN 55317 -0147
Study No. CO236.A2
SPRINGSTED Incorporated
March 7, 1996
SPRINGSTED
PUBLIC FINANCE ADVISORS
I RECOMMENDATIONS
Re: $900,000 General Obligation Improvement Refunding Bonds, Series 1996A
Proceeds of the issue will be used to refund the 1997 through 2003 maturities of the City's
General Obligation Improvement Bonds of 1987. The refunding is being done to provide
interest cost savings, which are expected to total approximately $208,807, with a present value
savings of approximately $70,355 which takes into consideration the loss of investment income
had the City not contributed $516,515 to reduce the amount of the refunding.
We recommend the following for the bonds:
2.
3
M
D
Action Requested To establish the date and time of receiving
bids and establish the terms and conditions
of the offering.
Sale Date and Time Monday, April 8, 1996, at 12:00 Noon, with
award by the City Council at 7:30 P.M. that
same day.
Authority and Purpose for the Bond Issue
The bonds are being issued pursuant to
Minnesota Statutes, Chapters 429 and 475,
and will be used, along with approximately
$516,515 of prepaid assessments which
have accumulated in the debt service fund
for the 1987 Bonds, to refund the 1997
through 2003 maturities of the City's 1987
Bonds for interest cost savings.
Principal Amount of Offering
The bonds are being issued in the principal
amount of $900,000, consisting of $873,800
of proceeds to finance the refunding,
approximately $19,000 to cover issuance
costs and $7,200 for the underwriter's
discount.
Repayment Term The first interest payment is due February 1,
1997. Principal is due February 1, 1997
through 2000. The term of this issue is three
years shorter than the term of the 1987
Bonds.
Source of Payments and Payment Cycle
This issue will be repaid from special
assessments currently pledged to the
repayment of the 1987 Bonds. First -half
collections of special assessments collected
in 1996 will be used to make the August 1,
1996 interest payment on the 1987 Bonds
as originally scheduled. Second -half
assessment collections, plus surplus first -
half collections, will be used to make the
February 1, 1997 principal and interest
payment on this issue. Thereafter, each
August 1 interest payment on this issue will
City of Chanhassen, Minnesota
March 7, 1996
be made from first -half collections of special
assessments and each subsequent
February 1 principal and interest payment
will be made from second -half collections,
plus surplus first -half collections.
7. Prepayment Provisions Due to the short maturity structure of this
issue, the bonds will be non - callable.
8. Credit Rating Comments We recommend the City apply to Standard &
Poor's Ratings Services for a rating on this
issue. The City is currently rated °'A-" b'°
StandA :y & Poor's.
9, Bank Qualification The City does not expect to issue over
$10,000,000 of tax - exempt obligations in
1996, and this issue is therefore eligible for
bank qualification. Issues which are bank -
qualified receive interest rates which are
lower than issues which are not bank -
qualified.
10. Rebate Requirements This issue is subject to the federal arbitrage
and rebate requirements because the City
issued over $5,000,000 of tax - exempt bonds
in the year in which the 1987 Bonds were
sold.
11. Bona Fide Debt Service Fund
The City must maintain a bona fide debt
service fund or be subject to yield restriction.
The refunding has been structured around
the existing assessment collections on the
1987 Bonds, and assuming assessments
are collected as scheduled, the City expects
to maintain a bona fide debt service fund.
12. Economic Life
The aggregate average life of this issue and
the 1987 Bonds cannot exceed 120% of the
economic life of the financed projects. Since
the average life of public improvements is
generally at least 20 years, and the
aggregate maturity of this issue is 11.08
years, this issue is in compliance with the
economic life requirements.
13. Continuing Disclosure This issue is not subject to the new SEC
continuing disclosure rules because the
issue size is less than $1,000,000. A
summary of the disclosure rules has been
provided to City staff, detailing the City's
continuing disclosure responsibilities. The
City sold obligations in 1995 which are
subject to the SEC regulations.
1
L
C�
Page 2 1
1
City of Chanhassen, Minnesota
March 7, 1996
14. Attachments
Refunding Schedules
Cash Flow of Debt Service Fund
Terms of Proposal
DISCUSSION
This issue constitutes a "current" refunding since all the remaining maturities of the 1987 bonds
will be called within 90 days of settlement of this issue. Proceeds of this issue will be used to
redeem all of the outstanding maturities of the 1987 Bonds on August 1, 1996. The City will
make the August 1, 1996 interest payment on the 1987 Bonds as originally scheduled.
Attached is the analytical summary of the refunding. Page 5 shows the debt service on the
1987 Bonds as it exists now. Page 6 shows the principal amount of the 1987 Bonds which will
be called for redemption on August 1, 1996 and paid from the proceeds of this issue. Page 7
shows the August 1, 1996 interest payment on the 1987 Bonds which will be paid by the City as
originally scheduled. Page 8 shows the projected debt service on the new refunding issue, and
Page 9 shows the projected annual savings (Column 6). Also included on Page 10 is the cash
flow for the debt service fund which shows the projected future special assessment collections
at 98% (Column 6) and factors in the City's cash contribution of $516,515.
' Respectfully submitted,
' SPRINGSTED Incorporated
J
sms
Provided to Staff:
a) Summary of Arbitrage Rules
b) Summary of Continuing Disclosure Requirements
C) Rebate Contract
Page 3
03/20/96 12:49 V612 223 3000 SPRINGSTED
City of Chanhassen, Minnesota
G.O. Refunding Bonds, Series 1996
Current Refunding Summary
Partial Current Refunding of
G.O. Improvement Bonds of 1987
Structured Around Special Assessments
, Refunding Bond Rating: A—
:Refunding Delivery Date Sources/ Uses
( Sources of Funds on:
05107/96
Refunding Principal:
900,000.00
Accrued lnterest:
616.89
Total Sources of Funds:
900,616.89
Usos of Funds on:
05107/96
Discount @ S8.00
7,200.00
Acc. Int. & Unused Disc:
616.89
Refunding Expenses:
19,000.00
Investment to Call Date:
873 ,800.00
Total Uses of Funds:
900, 616.89
Refunded / Refunding Bond Comparison
As of: Refunded
y
Refunding
05;01/96 Statistics
Statistics
Principal:
1,400,000
900,000
Interest:
327,700
85,134
Bond Yrs:
5,250
2,025
Avg. Mat:
3.750
2.250
NICC
6.24%
1 4.56
Prepared: 03/20196
By SPRINGSTED incorporated
121002/003 '
Date of Bonds:
05/01/96
'
Delivery Date:
05107!96 J
Inv. Earnings @ 4.75 :
Refunded Call:
08/01/96
516,515.36
1 st Callable:
02/01/97
,
Uses of Funds on:
08/01/96
Refunded Principal:
Refunded Bond Call Date Sour / Use:
Sources of Funds on:
08/01/96
Invest. Proceeds Mature:
873,800.00
Inv. Earnings @ 4.75 :
9,684.62
Funds from Issuer:
516,515.36
Total Sources of Funds:
1,400,000.00
59,503.39
Uses of Funds on:
08/01/96
Refunded Principal:
1,400,000.00
Refunded Call Premium:
Excess Proceeds:
Total Uses of Funds:
1,400,000.00
Total Net Savings /Present Value Savings
Future Savings:
720,265.62
Less Funds From Issuer:
516,515.38
Plus Accr. Int, to D/S Fund:
616.89
Plus Exc. PrDc. to D/S Fund:
_
Total N et Savings:
204,367:13
Present Value Sav @ 4.19%:
59,503.39
As Na of P.V. Refunded Int.:
21.810lo
03/20/96 12:50 V612 223 3000 SPRINGSTED 2 003/003
City of Chanhassen, Minnesota
G.G. Refunding Bonds, Series 1996
Prepared:
03/20/96
Annual Savings Analysis
E. SPRINGSTED
Incorporated
Schedule
E
Refunding Non- Refunded
Date Debt Service Deft Service
Total New
Debt Service
Existing
Savings
(1) (2) {3
Leht Service
or (Loss)
(6)
OS/ 01/96
02/01/97 2 52,759.38 44 600.00
08;01/97
297,359.38
289,200.00
(8,159.38)
02/01/98 253,350.00
08/01/98
253,350.00
276,200.00
22,850.00
02;01/199 244,237.50
01
08/;99
244,237.50
263,000.00
18 762050
02/01/2000 234,787.50
08;01/2000
234,787.50
249,600.60
14,812.50
02;01/2001
08;01j2C01
235,000.00
236,000.0C
02; 01/2002
08/01/2002
2 24,000.00
2 24,000.00
02/01!2003
212,00C.oQ
212,000°00
Tot aIs 785,134.38 44,600.00 1 , 02 9,734.3B 38 1, 7 5 0,000.OU 726,265,62
Present Value Sating.: 4.1940$ Funds from Issuer... (
Present Value Savings: 59,503.39 .: 516,515.38)
S °s of P.`,'. Ref. lilt: 59,503.39 Int. to E)/'S Fund, 616.89
71.81 °s Total Net S,-ivings... 2.04,367.13
City f Chanhassen Minnesota 1
y � Prepared: 03/06/
G.O. Improvement Bonds of 1987 By SPRINGSTED Incorporated
Refunded Principal and any Call Premium
Schedule B '
Date
08/01/96
02/01/97
Principal
1,400,000.00
Premium
Totals 1,400,000.00
Call Date ............. 08/01/96
First Date Called.....: 02/01/97
Call Premium...... ....
Semi - Annual Annul
1,400,000.00
1,400,000.0'
1,400,000.00 1,400,000.00
This portion will be paid with proceeds'
Rage 6 '
ity of Chanhassen, Minnesota
.0. Improvement Bonds of 1987
Non - Refunded Debt Service
Date Principal
08/01/96
02/01/97
1
Schedule C
Rate Interest
1
totals
[his portion Will be paid by the issuer
the entire existing debt service.
9�1� 9I
.. .�4 1I
Prepared: 03/06/96
By SPRINGSTED Incorporated
Semi - Annual Annual
f�• $I
44,600.00
44,600.00 44,600.00
The first payment includes interest on
Page 7
City of Chanhassen, Minnesota
G.O. Refunding Bonds, Series 1996
Refunding Debt Service
Date
02/01/97
08/01/97
02/01/98
08/01/98
02/01/99
08/01/99
02/01/2000
Totals
Bond Date.:
Avg, Mat..:
NIC ....... :
Principal
225,000.00
225,000.00
225,000.00
225,000.00
900,000,00
05/01/96
2.250
4.3390
Schedule D
Rate Interest
3.6500
3 . 850`
4.0006
4.1006
26,325.00
13,443,75
13.443.75
9,12.50
9,112.50
4,612.50
4,612.50
80,662.50
I
Prepared:
03/06/91
By SPRINGSTED
Incorporated
I
Semi - Annual
Annual
251,325.00
251,325.00'
13,443.75
238,443.75
251. 1�
9,112.50
234,112.50
243,225,00
4,612.50
229,612.50
234,225.00'
980,662.50
980,662.50
Delivery..:
05/07/96'
Discount.':
0.800007
Bond Yield:
3.97442'
Page 8 1
n
k otals
980,662.50
44,600.00
1,025,262.50 1,750,000.00
724,737.50
resent
Value Rate...:
ity of Chanhassen,
Minnesota
(516,515.38)
Prepared:
03/06/96
70,354.53
.O. Refunding
Bonds, Series 1996
As . of
By SPRINGSTED
Incorporated
Annual
Savings
Analysis
I Schedule
E
Refunding Non - Refunded
Total New
Existing
Savings
Date Debt
Service Debt Service
Debt Service
Debt Service
or (Loss)
'
(1)
(2) (3)
(4)
(5)
(6)
' 08/01/96
02/01/97
251,325.00 44,600.00
295,925.00
289,200.00
(6,725.00)
08/01/97
251,887.50
251,887.50
276,200.00
24,312.50
' 08/01/98
02/01/99
243,225.00
243,225.00
263,000.00
19,775.00
08/01/99
2/01/2000
234,225.00
234,225.00
249,600.00
15,375.00
8/01/2000
2/01/2001
236,000.00
236,000.00
8/01/2001
2/01/2002
224,000.00
224,000.00
8/01/2002
02/01/2003
212,000.00
212,000.00
n
k otals
980,662.50
44,600.00
1,025,262.50 1,750,000.00
724,737.50
resent
Value Rate...:
3.9744.
Funds from Issuer....:
(516,515.38)
resent
Value Savings:
70,354.53
Acc. Int. to D/S Fund:
585.01
As . of
P.V. Ref. Int:
25.64
Total Net Savings.....
208,807.13
1
Page 9
City Chanhassen,
Minnesota
'
of
Prepared
03/06/96
G.O. Improvement Bonds of 1987
By
SPRINGSTED Incorporated
Existing Cash
Flow Before Advance Refunding
98.00%
4.75%
,
Debt
Special
Invest.
Date
Principal
Rate
Interest
Service
Assess.
Earnings
Balance
(
(
(
(
(
(
(
(8)
'
Beginning Balance:
1,050,000.00
02/01/96
400,000.00
6.40%
57,400.00
457,400.00
592,600.00
08/01/96
44,600.00
44,600.00
151,900.00
15,532.89
715,432.89'
'
02/01/97
200,000.00
6.50%
44,600.00
244,600.00
151,900.00
16,081.69
638,814.581
08/01/97
38,100.00
38,100.00
127,400.00
16,427.36
744,541.94;
02/01/98
200,000.00
6.60%
38,100.00
238,100.00
127,400.00
16,565.02
650,406.96'
'
08/01/98
31,500.00
31,500.00
107,800.00
16,549.76
743,256.72'.
02/01/99
200,000.00
6.70%
31,500.00
231,500.00
107,800.00
16,377.90
635,934.62
08/01/99
' 1 4,800. 1 "'C'
24,800.10
102,900.00
16,223.54
730,258.15
02/01/2000
200,000.00
6.80%
24,800.00
224,800.00
102,900.00
16,087.10
624,445.26'
'
08/01/2000
18,000.00
18,000.00
93,100.00
15,911.33
715,456.59
02/01/2001
200,000.00
6.00%
18,000.00
218,000.00
93,100.00
15,695.29
606,251.88
08/01/2001
12,000.00
12,000.00
88,200.00
15,487.27
697,939.15
'
02/01/2002
200,000.00
6.00%
12,000.00
212,000.00
88,200.00
15,287.47
589,426.62
08/01/2002
6,000.00
6,000.00
14,095.01
597,521.63
02/01/2003
200,000.00
6.00%
6,000.00
206,000.00
11,886.04
403,407.67
'
Totals
1,800,000.00
407,400.00
2,207,400.00
1,342.600.00
218,207.67
Projected Cash
Flow After Advance Refunding
98.00%
4.75%
Debt
Special
Invest.
'
Date
Principal
Rate
Interest
Service
Assess.
Earnings
Balance;
(
(
(
(
(
(
(
(
02/01/96
592,600.00
'
05/07/96
(585.01)
593,185.01
08/01/96
561,115.38
151,900.00
15,532.89
199,502.52'.
02/01/97
225,000.00
3.65%
26,325.00
251,325.00
151,900.00
3,600.27
103,677.79'
08/01/97
13,443.75
13,443.75
127,400.00
3,861.43
221,495.47
'
02/01/98
225,000.00
3.85%
13,443.75
238,443.75
127,400.00
3,989.25
114,440.97
08/01/98
9,112.50
9,112.50
107,800.00
3,936.63
217,065.101
02/01/99
225,000.00
4.00%
9,112.50
234,112.50
107,800.00
3,699.26
94,451.86
08/01/99
4,612.50
4,612.50
102,900.00
3,451.38
196,190.74.
02/01/2000
225,000.00
4.10%
4,612.50
229,612.50
102,900.00
3,192.73
72,670.97
08/01/2000
0.00
0.00
93,100.00
2,865.53
168,636.50
'
02/01/2001
0.00
4.20%
0.00
0.00
93,100.00
5,172.10
266,908.60
08/01/2001
0.00
0.00
88,200.00
7,475.22
362,583.82
02/01/2002
0.00
4.35%
0.00
0.00
88,200.00
9,774.82
460,558.641
08/01/2002
0.00
0.00
0.00
11,069.72
471,628.36
'
02/01/2003
0.00
0.00
0.00
11,335.79
482,964.15'
,
Totals
900 000.00
80,662.50
1,541,192.87
1,342,600.00
88,957.02
Page 10 1
' THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS
ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS:
TERMS OF PROPOSAL
' $900,000
CITY OF CHANHASSEN, MINNESOTA
' GENERAL OBLIGATION IMPROVEMENT REFUNDING BONDS,
SERIES 1996A
' (BOOK ENTRY ONLY)
Proposals for the Bonds will be received on Monday, April 8, 1996, until 12:00 Noon, Central
Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul,
Minnesota, after which time they will be opened and tabulated. Consideration for award of the
Bonds will be by the City Council at 7:30 P.M., Central Time, of the same day.
' SUBMISSION OF PROPOSALS
Proposals may be submitted in a sealed envelope or by fax (612) 223 -3002 to Springsted.
Signed Proposals, without final price or coupons, may be submitted to Springsted prior to the
time of sale. The bidder shall be responsible for submitting to Springsted the final Proposal
price and coupons, by telephone (612) 223 -3000 or fax (612) 223 -3002 for inclusion in the
submitted Proposal. Springsted will assume no liability for the inability of the bidder to reach
Springsted prior to the time of sale specified above. Proposals may also be filed electronically
via PARITY, in accordance with PARITY Rules of Participation and the Terms of Proposal,
within a one -hour period prior to the time of sale established above, but no Proposals will be
received after that time. If provisions in the Terms of Proposal conflict with the PARITY Rules
of Participation, the Terms of Proposal shall control. The normal fee for use of PARITY may be
obtained from PARITY and such fee shall be the responsibility of the bidder. For further
information about PARITY, potential bidders may contact PARITY at 100 116th Avenue SE,
Suite 100, Bellevue, Washington 98004, telephone (206) 635 -3545. Neither the City nor
Springsted Incorporated assumes any liability if there is a malfunction of PARITY. All bidders
are advised that each Proposal shall be deemed to constitute a contract between the bidder
and the City to purchase the Bonds regardless of the manner of the Proposal submitted.
DETAILS OF THE BONDS
The Bonds will be dated May 1, 1996, as the date of original issue, and will bear interest
payable on February 1 and August 1 of each year, commencing February 1, 1997. Interest will
be computed on the basis of a 360 -day year of twelve 30 -day months.
The Bonds will mature February 1 in the years and amounts as follows:
1997 $225,000
1998 $225,000
1999 $225,000
2000 $225,000
BOOK ENTRY SYSTEM
The Bonds will be issued by means of a book entry system with no physical distribution of
Bonds made to the public. The Bonds will be issued in fully registered form and one Bond,
representing the aggregate principal amount of the Bonds maturing in each year, will be
Page 11
u
registered in the name of Cede & Co. as nominee of The Depository Trust Company ( "DTC "),
New York, New York, which will act as securities depository of the Bonds. Individual purchases
of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single
maturity through book entries made on the books and records of DTC and its participants.
Principal and interest are payable by the registrar to DTC or its nominee as registered owner of
the Bonds. Transfer of principal and interest payments to participants of DTC will be the
responsibility of DTC; transfer of principal and interest payments to beneficial owners by
participants will be the responsibility of such participants and other nominees of beneficial
owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the
Bonds with DTC.
REGISTRAR
The City will name the registrar which shall be subject to applicable SEC regulations, The City
will ; pay for the services of the registrar.
OPTIONAL REDEMPTION
The Bonds will not be subject to payment in advance of their respective stated maturity dates.
SECURITY AND PURPOSE
The Bonds will be general obligations of the City for which the City will pledge its full faith and
credit and power to levy direct general ad valorem taxes. In addition the City will pledge special
assessments against benefited property. The proceeds will be used along with excess City
debt service funds to refund the 1997 through 2003 maturities of the City's $4,685,000 General
Obligation Improvement Bonds of 1987, dated July 1, 1987.
TYPE OF PROPOSALS
Proposals shall be for not less than $892,800 and accrued interest on the total principal amount
of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ( "Deposit ") in the form
of a certified or cashier's check or a Financial Surety Bond in the amount of $9,000, payable to
the order of the City. If a check is used, it must accompany each proposal. If a Financial
Surety Bond is used, it must be from an insurance company licensed to issue such a bond in
the State of Minnesota, and preapproved by the City. Such bond must be submitted to
Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must
identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the
Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is
required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's
check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central
Time, on the next business day following the award. If such Deposit is not received by that
time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement.
The City will deposit the check of the purchaser, the amount of which will be deducted at
settlement and no interest will accrue to the purchaser. In the event the purchaser fails to
comply with the accepted proposal, said amount will be retained by the City. No proposal can
be withdrawn or amended after the time set for receiving proposals unless the meeting of the
City scheduled for award of the Bonds is adjourned, recessed, or continued to another date
without award of the Bonds having been made. Rates shall be in integral multiples of 5/100 or
1/8 of 1 %. Rates must be in ascending order. Bonds of the same maturity shall bear a single
rate from the date of the Bonds to the date of maturity. No conditional proposals will be
accepted.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true
interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in
accordance with customary practice, will be controlling.
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The City will reserve the right to: (i) waive non - substantive informalities of any proposal or of
matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals
without cause, and, (iii) reject any proposal which the City determines to have failed to comply
with the terms herein.
BOND INSURANCE AT PURCHASER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment
therefor at the option of the underwriter, the purchase of any such insurance policy or the
issuance of any such commitment shall be at the sole option and expense of the purchaser of
the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of
insurance shall be paid by the purchaser, except that, if the City has requested and received a
rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating
agency fees shall be the responsibility of the purchaser.
Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the
purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on
the Bonds.
CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the
Bonds, but neither the failure to print such numbers on any Bond nor any error with respect
thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the
Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers
shall be paid by the purchaser.
SETTLEMENT
Within 40 days following the date of their award, the Bonds will be delivered without cost to the
purchaser at a place mutually satisfactory to the City and the purchaser. Delivery will be
subject to receipt by the purchaser of an approving legal opinion of Kennedy & Graven,
Chartered of Minneapolis, Minnesota, and of customary closing papers, including a no- litigation
certificate. On the date of settlement payment for the Bonds shall be made in federal, or
equivalent, funds which shall be received at the offices of the City or its designee not later than
12:00 Noon, Central Time. Except as compliance with the terms of payment for the Bonds shall
have been made impossible by action of the City, or its agents, the purchaser shall be liable to
the City for any loss suffered by the City by reason of the purchaser's non - compliance with said
terms for payment.
CONTINUING DISCLOSURE
Participating underwriters need not comply with the continuing disclosure requirements of
Rule 15c2 -12 promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934 (the "Rule "), because the offering is in a principal amount less than
$1,000,000. Consequently, the City will not enter into any undertaking to provide continuing
disclosure of any kind with respect to the Bonds.
OFFICIAL STATEMENT
The City has authorized the preparation of an Official Statement containing pertinent
information relative to the Bonds, and said Official Statement will serve as a nearly -final Official
Statement within the meaning of Rule 15c2 -12 of the Securities and Exchange Commission.
For copies of the Official Statement or for any additional information prior to sale, any
prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated,
85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (612) 223 -3000.
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The Official Statement, when further supplemented by an addendum or addenda specifying the
maturity dates, principal amounts and interest rates of the Bonds, together with any other
information required by law, shall constitute a "Final Official Statement" of the City with respect
to the Bonds, as that term is defined in Rule 15c2 -12. By awarding the Bonds to any
underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no
more than seven business days after the date of such award, it shall provide without cost to the
senior managing underwriter of the syndicate to which the Bonds are awarded 35 copies of the
Official Statement and the addendum or addenda described above. The City designates the
senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for
purposes of distributing copies of the Final Official Statement to each Participating Underwriter.
Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its
proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a
contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring
the receipt by each such Participating Underwrite of the Final Official Statements
Dated March 11, 1996
BY ORDER OF THE CITY COUNCIL
/s/ Don Ashworth
City Manager
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