2004-47a
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EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE
CITY OF CHANHASSEN, MINNESOTA
HELD: July 12,2004
Pursuant to due call, a regular meeting of the City Council of the City of Chanhassen,
Carver and Hennepin Counties, Minnesota, was duly held at the City Hall on July 12, 2004, at
7:00 P.M., for the purpose, in part, of authorizing the issuance and awarding the sale of
$2,070,000 General Obligation Bonds, Series 2004A.
The following members were present:
Tom Furlong, Bob Ayotte, Steve Labatt, Brian Lundquist, Craig Peterson
and the following were absent:
None
Member Labatt introduced the following resolution and moved its adoption:
Resolution 2004-41"
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF $2,070,000 GENERAL
OBLIGATION BONDS, SERIES 2004A, PLEDGING FOR THE SECURITY
THEREOF SPECIAL ASSESSMENTS AND LEVYING A TAX FOR THE PAYMENT
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A. WHEREAS, the City Council of the City of Chanhassen, Minnesota (the "City")
has heretofore determined and declared that it is necessary and expedient to issue $2,070,000
General Obligation Bonds, Series 2004A (the "Bonds" or individually a "Bond"), pursuant to
Minnesota Statutes, Chapter 475 and:
1. Chapter 429 to finance various improvement projects (the "Improvements"), in
the amount of $985,000 (the "Improvement Portion ofthe Bonds"). The Improvements and all
their components have been ordered prior to the date hereof, after a hearing thereon for which
notice was given describing the Improvements or all their components by general nature,
estimated cost, and area to be assessed;
2. Section 412.301 to finance the purchase of various items of capital equipment for
the City (the "Equipment"), in the amount of$785,000 (the "Equipment Portion oftheBonds").
Each item of Equipment to be financed by the Equipment Portion of the Bonds has an expected
useful life at least as long as the term of the Equipment Portion ofthe Bonds. The principal
amount of the Equipment Portion of the Bonds does not exceed one-quarter of one percent
(0.25%) ofthe market value ofthe taxable property in the City ($2,259,751,400 times 0.25% is
$5,649,379); and
3. Section 475.521 to provide funds to finance remodeling ofthe former library
space for City Hall uses (the "Capital Improvements"), in the amount of $300,000 (the "Capital
Improvements Portion ofthe Bonds"). On December 8, 2003, the City held a public hearing on
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and adopted the Five Year Capital Improvement Plan (the "Plan"), and on June 10, 2004, the
City held a public hearing on the proposed issuance of general obligation capital improvement .
bonds, all in accordance with the provisions of Minnesota Statutes, Section 475.521. The Plan
provides, in part, for the Capital Improvements. No petition signed by voters equal to five
percent of the votes cast in the City in the last general election requesting a vote on the issuance
of the Capital Improvements Portion of the Bonds has been filed with the City Manager within
30 days after the date the public hearing on the issuance of the Capital Improvements Portion of
the Bonds was held; and
B. WHEREAS, the City has retained Ehlers & Associates, Inc., in Roseville,
Minnesota ("Ehlers"), as its independent financial advisor for the sale of the Bonds and was
therefore authorized to sell the Bonds by private negotiation in accordance with Minnesota
Statutes, Section 475.60, Subdivision 2(9) and proposals to purchase the Bonds have been
solicited by Ehlers; and
C. WHEREAS, the proposals set forth on Exhibit A attached hereto were received
by the City Manager, or designee, at the offices of Ehlers, at 12 :00 noon, this same day pursuant
to the Terms of Proposal established for the Bonds; and
D. WHEREAS, it is in the best interests of the City that the Bonds be issued in book-
entry form as hereinafter provided; and
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Chanhassen,
Minnesota, as follows:
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1. Acceptance of Proposal. The proposal ofCitigroup Global Markets, Inc. (the
"Purchaser"), to purchase the Bonds, in accordance with the Terms of Proposal established for
the Bonds, at the rates of interest hereinafter set forth, and to pay therefor the sum of
$2,069,766.54, plus interest accrued to settlement, is hereby found, determined and declared to
be the most favorable proposal received, is hereby accepted and the Bonds are hereby awarded to
the Purchaser. The City Manager is directed to retain the deposit of the Purchaser and to
forthwith return to the unsuccessful bidders any good faith checks or drafts.
2. Bond Terms.
(a) Original Issue Date: Denominations: Maturities: Term Bond Ootion. The Bonds
shall be dated August 10, 2004, as the date of original issue and shall be issued forthwith on or
after such date in fully registered form, shall be numbered from R -1 upward in the denomination
of$5,000 each or in any integral multiple thereof of a single maturity (the "Authorized
Denominations") and shall mature on February 1 in the years and amounts as follows:
Year Amount Year Amount
2006 $355,000 2011 $70,000
2007 360,000 2012 70,000
2008 370,000 2013 70,000
2009 380,000 2014 25,000
2010 345,000 2015 25,000 e
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As may be requested by the Purchaser, one or more term Bonds may be issued having mandatory
sinking fund redemption and fmal maturity amounts conforming to the foregoing principal
repayment schedule, and corresponding additions may be made to the provisions of the
applicable Bond(s).
(b) Allocation. The Improvement Portion of the Bonds, being the aggregate principal
amount of $985,000, maturing in each of the years and amounts hereinafter set forth, is issued to
finance the Improvements. The Equipment Portion of the Bonds, being the aggregate principal
amount of $785,000, maturing in each ofthe years and amounts hereinafter set forth, is issued to
finance the Equipment. The Capital Improvements Portion of the Bonds, being the aggregate
principal amount of $300,000, maturing in each of the years and amounts hereinafter set forth, is
issued to finance the Capital Improvements.
Capital
Improvement Equipment Improvements
Year Portion (Amount) Portion (Amount) Portion (Amount) Total Amount
2006 $145,000 $190,000 $20,000 $355,000
2007 150,000 190,000 20,000 360,000
2008 155,000 200,000 15,000 370,000
2009 160,000 205,000 15,000 380,000
2010 115,000 230,000 345,000
2011 70,000 70,000
e 2012 70,000 70,000
2013 70,000 70,000
2014 25,000 25,000
2015 25,000 25,000
With respect to the Capital Improvements Portion ofthe Bonds, the maximum annual
principal and interest on the Capital Improvements Portion of the Bonds and any other
outstanding bonds of the City previously issued under Section 475.521, Subdivision 4, is less
than .05367% of the taxable market value of the County.
If Bonds are prepaid, the prepayments shall be allocated to the portions of debt service
(and hence allocated to the payment of Bonds treated as relating to a particular portion of debt
service) as provided in this paragraph. If the source of prepayment moneys is the general fund of
the City, or other generally available source, the prepayment may be allocated to either or both of
the portions of debt service in such amounts as the City shall determine. If the source of the
prepayment is special assessments pledged to and taxes levied for the Improvements, the
prepayment shall be allocated to the Improvement Portion of debt service.
(c) Book Entry Only System. The Depository Trust Company, a limited purpose
trust company organized under the laws of the State of New York or any of its successors or its
successors to its functions hereunder (the "Depository") will act as securities depository for the
Bonds, and to this end:
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(i)
The Bonds shall be initially issued and, so long as they remain in book entry form
only (the "Book Entry Only Period"), shall at all times be in the form of a separate
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single fully registered Bond for each maturity of the Bonds; and for purposes of
complying with this requirement under paragraphs 5 and 10 Authorized e
Denominations for any Bond shall be deemed to be limited during the Book Entry
Only Period to the outstanding principal amount of that Bond.
(ii) Upon initial issuance, ownership of the Bonds shall be registered in a bond
register maintained by the Bond Registrar (as hereinafter defined) in the name of
CEDE & CO., as the nominee (it or any nominee of the existing or a successor
Depository, the "Nominee").
(iii) With respect to the Bonds neither the City nor the Bond Registrar shall have any
responsibility or obligation to any broker, dealer, bank, or any other financial
institution for which the Depository holds Bonds as securities depository (the
"Participant") or the person for which a Participant holds an interest in the Bonds
shown on the books and records of the Participant (the "Beneficial Owner").
Without limiting the immediately preceding sentence, neither the City, nor the
Bond Registrar, shall have any such responsibility or obligation with respect to
(A) the accuracy of the records of the Depository, the Nominee or any Participant
with respect to any ownership interest in the Bonds, or (B) the delivery to any
Participant, any Owner or any other person, other than the Depository, of any
notice with respect to the Bonds, including any notice of redemption, or (C) the
payment to any Participant, any Beneficial Owner or any other person, other than
the Depository, of any amount with respect to the principal of or premium, if any,
or interest on the Bonds, or (D) the consent given or other action taken by the e
Depository as the Registered Holder of any Bonds (the "Holder"). For purposes
of securing the vote or consent of any Holder under this Resolution, the City may,
however, rely upon an omnibus proxy under which the Depository assigns its
consenting or voting rights to certain Participants to whose accounts the Bonds
are credited on the record date identified in a listing attached to the omnibus
proxy.
(iv) The City and the Bond Registrar may treat as and deem the Depository to be the
absolute owner of the Bonds forthe purpose of payment of the principal of and
premium, if any, and interest on the Bonds, for the purpose of giving notices of
redemption and other matters with respect to the Bonds, for the purpose of
obtaining any consent or other action to be taken by Holders for the purpose of
registering transfers with respect to such Bonds, and for all purpose whatsoever.
The Bond Registrar, as paying agent hereunder, shall pay all principal of and
premium, if any, and interest on the Bonds only to the Holder or the Holders of
the Bonds as shown on the bond register, and all such payments shall be valid and
effective to fully satisfY and discharge the City's obligations with respect to the
principal of and premium, if any, and interest on the Bonds to the extent of the
sum or sums so paid.
(v)
Upon delivery by the Depository to the Bond Registrar of written notice to the
effect that the Depository has determined to substitute a new Nominee in place of
the existing Nominee, and subject to the transfer provisions in paragraph 10,
references to the Nominee hereunder shall refer to such new Nominee.
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(vi) So long as any Bond is registered in the name of a Nominee, all payments with
respect to the principal of and premium, if any, and interest on such Bond and all
notices with respect to such Bond shall be made and given, respectively, by the
Bond Registrar or City, as the case may be, to the Depository as provided in the
Letter of Representations to the Depository required by the Depository as a
condition to its acting as book-entry Depository for the Bonds (said Letter of
Representations, together with any replacement thereof or amendment or
substitute thereto, including any standard procedures or policies referenced
therein or applicable thereto respecting the procedures and other matters relating
to the Depository's role as book-entry Depository for the Bonds, collectively
hereinafter referred to as the "Letter of Representations").
(vii) All transfers of beneficial ownership interests in each Bond issued in book-entry
form shall be limited in principal amount to Authorized Denominations and shall
be effected by procedures by the Depository with the Participants for recording
and transferring the ownership of beneficial interests in such Bonds.
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(viii) In connection with any notice or other communication to be provided to the
Holders pursuant to this Resolution by the City or Bond Registrar with respect to
any consent or other action to be taken by Holders, the Depository shall consider
the date of receipt of notice requesting such consent or other action as the record
date for such consent or other action; provided, that the City or the Bond Registrar
may establish a special record date for such consent or other action. The City or
the Bond Registrar shall, to the extent possible, give the Depository notice of such
special record date not less than 15 calendar days in advance of such special
record date to the extent possible.
(ix) Any successor Bond Registrar in its written acceptance of its duties under this
Resolution and any paying agencylbond registrar agreement, shall agree to take
any actions necessary from time to time to comply with the requirements of the
Letter of Representations.
(x) In the case of a partial prepayment of a Bond, the Holder may, in lieu of
surrendering the Bonds for a Bond of a lesser denomination as provided in
paragraph 5, make a notation of the reduction in principal amount on the panel
provided on the Bond stating the amount so redeemed.
(d) Termination of Book-Entry Only System. Discontinuance of a particular
Depository's services and termination of the book-entry only system may be effected as follows:
(i)
The Depository may determine to discontinue providing its services with respect
to the Bonds at any time by giving written notice to the City and discharging its
responsibilities with respect thereto under applicable law. The City may
terminate the services of the Depository with respect to the Bond if it determines
that the Depository is no longer able to carry out its functions as securities
depository or the continuation of the system of book-entry transfers through the
Depository is not in the best interests of the City or the Beneficial Owners.
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(ii)
Upon termination of the services of the Depository as provided in the preceding
paragraph, and if no substitute securities depository is willing to undertake the
functions of the Depository hereunder can be found which, in the opinion of the
City, is willing and able to assume such functions upon reasonable or customary
terms, or if the City determines that it is in the best interests of the City or the
Beneficial Owners of the Bond that the Beneficial Owners be able to obtain
certificates for the Bonds, the Bonds shall no longer be registered as being
registered in the bond register in the name of the Nominee, but may be registered
in whatever name or names the Holder of the Bonds shall designate at that time,
in accordance with paragraph 10. To the extent that the Beneficial Owners are
designated as the transferee by the Holders, in accordance with paragraph 10, the
Bonds will be delivered to the Beneficial Owners.
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(iii) Nothing in this subparagraph (d) shall limit or restrict the provisions of paragraph
10.
(e) Letter of Representations. The provisions in the Letter of Representations are
incorporated herein by reference and made a part of the resolution, and if and to the extent any
such provisions are inconsistent with the other provisions of this resolution, the provisions in the
Letter of Representations shall control.
3. Purpose. The Improvement Portion of the Bonds shall provide funds to finance
the Improvement Project. The Equipment Portion of the Bonds shall provide funds to finance
acquisition of the Equipment. The Capital Improvements Portion of the Bonds shall provide e
funds to finance the Capital Improvements. The Improvement Project, Equipment and Capital . ..
Improvements are herein referred to together as the Project. The total cost of the Project, which
shall include all costs enumerated in Minnesota Statutes, Section 475.65, is estimated to be at
least equal to the amount of the Bonds. The City covenants that it shall do all things and perform
all acts required of it to assure that work on the Project proceeds with due diligence to
completion and that any and all permits and studies required under law for the Project are
obtained.
4. Interest. The Bonds shall bear interest payable semiannually on February 1 and
August 1 of each year (each, an "Interest Payment Date"), commencing February 1, 2005,
calculated on the basis of a 360-day year of twelve 30-day months, at the respective rates per
annum set forth opposite the maturity years as follows:
Maturity Year Interest Rate Maturity Year Interest Rate
2006 2.50% 2011 3.50%
2007 2.50% 2012 3.50%
2008 2.75% 2013 3.75%
2009 3.00% 2014 4.00%
2010 3.25% 2015 4.00%
5. Redemption. All Bonds maturing on February 1, 2010 and thereafter, shall be
subject to redemption and prepayment at the option of the City on February 1, 2009, and on any e
date thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of
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the Bonds subject to prepayment. If redemption is in part, the maturities and the principal
amounts within each maturity to be redeemed shall be determined by the City; and if only part of
the Bonds having a common maturity date are called for prepayment, the specific Bonds to be
prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof called for
redemption shall be due and payable on the redemption date, and interest thereon shall cease to
accrue from and after the redemption date. Mailed notice of redemption shall be given to the
paying agent and to each affected registered holder of the Bonds at least thirty days prior to the
date fixed for redemption.
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To effect a partial redemption of Bonds having a common maturity date, the Bond
Registrar prior to giving notice of redemption shall assign to each Bond having a common
maturity date a distinctive number for each $5,000 of the principal amount of such Bond. The
Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in
its discretion, from the numbers so assigned to such Bonds, as many numbers as, at $5,000 for
each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be
redeemed shall be the Bonds to which were assigned numbers so selected; provided, however,
that only so much of the principal amount of each such Bond of a denomination of more than
$5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If
a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, ifthe
City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the
City and Bond Registrar duly executed by the Holder thereof or the Holder's attorney duly
authorized in writing) and the City shall execute (if necessary) and the Bond Registrar shall
authenticate and deliver to the Holder of the Bond, without service charge, a new Bond or Bonds
having the same stated maturity and interest rate and of any Authorized Denomination or
Denominations, as requested by the Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Bond so surrendered.
6. Bond Registrar. Bond Trust Services Corporation, in Roseville, Minnesota, is
appointed to act as bond registrar and transfer agent with respect to the Bonds (the "Bond
Registrar"), and shall do so unless and until a successor Bond Registrar is duly appointed, all
pursuant to any contract the City and Bond Registrar shall execute which is consistent herewith.
The Bond Registrar shall also serve as paying agent unless and until a successor paying agent is
duly appointed. Principal and interest on the Bonds shall be paid to the registered holders (or
record holders) ofthe Bonds in the manner set forth in the form of Bond and paragraph 12.
7. Form of Bond. The Bonds, together with the Bond Registrar's Certificate of
Authentication, the form of Assignment and the registration information thereon, shall be in
substantially the following form:
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UNITED STATES OF AMERICA
STATE OF MINNESOTA
CARVER AND HENNEPIN COUNTIES
CITY OF CHANHASSEN
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R-
$
GENERAL OBLIGATION BOND, SERIES 2004A
Interest Rate
Maturity Date
Date of Original Issue
CUSIP
February 1,
August 10, 2004
REGISTERED OWNER:
CEDE & CO.
PRINCIPAL AMOUNT:
The City ofChanhasse~ Carver and Hennepin Counties, Minnesota (the "Issuer"),
certifies that it is indebted and for value received promises to pay to the registered owner
specified above, or registered assigns, unless called for earlier redemption, in the manner
hereinafter set forth, the principal amount specified above, on the maturity date specified above,
and to pay interest thereon semiannually on February 1 and August 1 of each year (each, an
"Interest Payment Date"), commencing February 1, 2005, at the rate per annum specified above
(calculated on the basis of a 360-day year of twelve 30-day months) until the principal sum is .-
paid or has been provided for. This Bond will bear interest from the most recent Interest .
Payment Date to which interest has been paid or, if no interest has been paid, from the date of
original issue hereof. The principal of and premium, if any, on this Bond are payable upon
presentation and surrender hereof at the principal office of Bond Trust Services Corporation, in
Roseville, Minnesota (the "Bond Registrar"), acting as paying agent, or any successor paying
agent duly appointed by the Issuer (the "Bond Registrar"), acting as paying agent, or any
successor paying agent duly appointed by the Issuer. Interest on this Bond will be paid on each
Interest Payment Date by check or draft mailed to the person in whose name this Bond is
registered (the "Holder" or "Bondholder") on the registration books of the Issuer maintained by
the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth
day of the calendar month next preceding such Interest Payment Date (the "Regular Record
Date"). Any interest not so timely paid shall cease to be payable to the person who is the Holder
hereof as of the Regular Record Date, and shall be payable to the person who is the Holder
hereof at the close of business on a date (the "Special Record Date") fixed by the Bond Registrar
whenever money becomes available for payment of the defaulted interest. Notice of the Special
Record Date shall be given to Bondholders not less than ten days prior to the Special Record
Date. The principal of and premium, if any, and interest on this Bond are payable in lawful
money of the United States of America. So long as this Bond is registered in the name ofthe
Depository or its Nominee as provided in the Resolution hereinafter described, and as those
terms are defmed therein, payment of principal of, premium, if any, and interest on this Bond and
notice with respect thereto shall be made as provided in the Letter of Representations, as defmed
in the Resolution, and surrender of this Bond shall not be required for payment of the redemption
price upon a partial redemption of this Bond. Until termination of the book-entry only system _
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pursuant to the Resolution, Bonds may only be registered in the name of the Depository or its
Nominee.
Redemption. All Bonds of this issue (the "Bonds") maturing on February 1, 2010, and
thereafter, are subject to redemption and prepayment at the option of the Issuer on February 1,
2009, and on any date thereafter at a price of par plus accrued interest. Redemption may be in
whole or in part of the Bonds subject to prepayment. If redemption is in part, the maturities and
the principal amounts within each maturity to be redeemed shall be determined by the Issuer; and
if only part of the Bonds having a common maturity date are called for prepayment, the specific
Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Bonds or portions thereof
called for redemption shall be due and payable on the redemption date, and interest thereon shall
cease to accrue from and after the redemption date. Mailed notice of redemption shall be given
to the paying agent and to each affected Holder ofthe Bonds at least thirty days prior to the date
fixed for redemption.
Selection of Bonds for Redemption: Partial Redemption. To effect a partial redemption
of Bonds having a common maturity date, the Bond Registrar shall assign to each Bond having a
common maturity date a distinctive number for each $5,000 of the principal amount of such
Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall
deem proper in its discretion, from the numbers assigned to the Bonds, as many numbers as, at
$5,000 for each number, shall equal the principal amount of such Bonds to be redeemed. The
Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided,
however, that only so much of the principal amount of such Bond of a denomination of more
than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so
selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar
(with, if the Issuer or Bond Registrar so requires, a written instrument of transfer in form
satisfactory to the Issuer and Bond Registrar duly executed by the Holder thereof or the Holder's
attorney duly authorized in writing) and the Issuer shall execute (if necessary) and the Bond
Registrar shall authenticate and deliver to the Holder of the Bond, without service charge, a new
Bond or Bonds having the same stated maturity and interest rate and of any Authorized
Denomination or Denominations, as requested by the Holder, in aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered.
Issuance: Purpose: General Obligation. This Bond is one of an issue in the total principal
amount of $2,070,000, all oflike date of original issue and tenor, except as to number, maturity,
interest rate, denomination and redemption privilege, issued pursuant to and in full conformity
with the Constitution and laws of the State of Minnesota and pursuant to a resolution adopted by
the City Council on July 12, 2004 (the "Resolution"), for the purpose of providing money to
finance various projects within the jurisdiction of the Issuer. This Bond is payable out of the
General Obligation Bonds, Series 2004A Fund of the Issuer. This Bond constitutes a general
obligation ofthe Issuer, and to provide moneys for the prompt and full payment of its principal,
premium, if any, and interest when the same become due, the full faith and credit and taxing
powers of the Issuer have been and are hereby irrevocably pledged.
Denominations: Exchange: Resolution. The Bonds are issuable solely in fully registered
form in Authorized Denominations (as defined in the Resolution) and are exchangeable for fully
registered Bonds of other Authorized Denominations in equal aggregate principal amounts at the
principal office of the Bond Registrar, but only in the manner and subject to the limitations
1664594vl
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provided in the Resolution. Reference is hereby made to the Resolution for a description of the
rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal e
office of the Bond Registrar.
Transfer. This Bond is transferable by the Holder in person or the Holder's attorney duly
authorized in writing at the principal office of the Bond Registrar upon presentation and
surrender hereof to the Bond Registrar, all subject to the terms and conditions provided in the
Resolution and to reasonable regulations of the Issuer contained in any agreement with the Bond
Registrar. Thereupon the Issuer shall execute and the Bond Registrar shall authenticate and
deliver, in exchange for this Bond, one or more new fully registered Bonds in the name of the
transferee (but not registered in blank or to "bearer" or similar designation), of an Authorized
Denomination or Denominations, in aggregate principal amount equal to the principal amount of
this Bond, of the same maturity and bearing interest at the same rate.
Fees upon Transfer or Loss. The Bond Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection with the transfer
or exchange of this Bond and any legal or unusual costs regarding transfers and lost Bonds.
Treatment of Registered Owners. The Issuer and Bond Registrar may treat the person in
whose name this Bond is registered as the owner hereof for the purpose of receiving payment as
herein provided (except as otherwise provided herein with respect to the Record Date) and for all
other purposes, whether or not this Bond shall be overdue, and neither the Issuer nor the Bond
Registrar shall be affected by notice to the contrary.
Authentication. This Bond shall not be valid or become obligatory for any purpose or be e
entitled to any security unless the Certificate of Authentication hereon shall have been executed
by the Bond Registrar.
Qualified Tax-Exemt>t Obligation. This Bond has been designated by the Issuer as a
"qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the Internal Revenue
Code of 1986, as amended.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things
required by the Constitution and laws of the State of Minnesota to be done, to happen and to be
performed, precedent to and in the issuance of this Bond, have been done, have happened and
have been performed, in regular and due form, time and manner as required by law; and that this
Bond, together with all other debts of the Issuer outstanding on the date of original issue hereof
and the date of its issuance and delivery to the original purchaser, does not exceed any
constitutional or statutory limitation of indebtedness.
IN WITNESS WHEREOF, the City ofChanhassen, Carver and Hennepin Counties,
Minnesota, by its City Council has caused this Bond to be executed on its behalfby the facsimile
signatures of its Mayor and its City Manager, the corporate seal of the Issuer having been
intentionally omitted as permitted by law.
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Date of Registration:
BOND REGISTRAR'S
CERTIFICATE OF
AUTHENTICATION
This Bond is one ofthe
Bonds described in the
Resolution mentioned
within.
, Minnesota,
Bond Registrar
By:
Authorized Signature
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Registrable by:
Payable at:
CITY OF CHANHASSEN,
CARVER AND HENNEPIN COUNTIES,
MINNESOTA
/s/ Facsimile
Mayor
/s/ Facsimile
City Manager
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this Bond, shall
be construed as though they were written out in full according to applicable laws or regulations:
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TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in common
UTMA - as custodian for
(Cust)
under the
(Minor)
Uniform
(State)
Transfers to Minors Act
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond
and does hereby irrevocably constitute and appoint attorney to transfer the
Bond on the books kept for the registration thereof, with full power of substitution in the
prennses.
Dated:
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Notice:
The assignor's signature to this assignment must correspond with
the name as it appears upon the face of the within Bond in every
particular, without alteration or any change whatever.
Signature Guaranteed:
Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm
having a membership in one of the major stock exchanges or any other "Eligible Guarantor
Institution" as defined in 17 CFR 240.17 Ad-15( a)(2).
The Bond Registrar will not effect transfer of this Bond unless the information
concerning the transferee requested below is provided.
Name and Address:
(Include information for all joint owners if the Bond is held by joint account.)
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PREPAYMENT SCHEDULE
This Bond has been prepaid in part on the date(s) and in the amount(s) as follows:
Date Amount Authorized signature of Holder
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8. Execution: Temporary Bonds. The Bonds shall be printed (or, at the request of
the Purchaser, typewritten) and shall be executed on behalf of the City by the signatures of its tit
Mayor and City Manager and be sealed with the seal of the City; provided, however, that the seal
of the City may be a printed (or, at the request of the Purchaser, photocopied) facsimile; and
provided further that both of such signatures may be printed (or, at the request of the Purchaser,
photocopied) facsimiles and the corporate seal maybe omitted on the Bonds as permitted by law.
In the event of disability or resignation or other absence of either officer, the Bonds may be
signed by the manual or facsimile signature of that officer who may act on behalf of the absent or
disabled officer. In case either officer whose signature or facsimile of whose signature shall
appear on the Bonds shall cease to be such officer before the delivery of the Bonds, the signature
or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if the officer
had remained in office until delivery. The City may elect to deliver, in lieu of printed definitive
bonds, one or more typewritten temporary bonds in substantially the form set forth above, with
such changes as may be necessary to reflect more than one maturity in a single temporary bond.
Such temporary bonds may be executed with photocopied facsimile signatures of the Mayor and
City Manager. Such temporary bonds shall, upon the printing of the definitive bonds and the
execution thereof, be exchanged therefor and canceled.
9. Authentication. No Bond shall be valid or obligatory for any purpose or be
entitled to any security or benefit under this resolution unless a Certificate of Authentication on
the Bond, substantially in the form hereinabove set forth, shall have been duly executed by an
authorized representative ofthe Bond Registrar. Certificates of Authentication on different
Bonds need not be signed by the same person. The Bond Registrar shall authenticate the
signatures of officers of the City on each Bond by execution of the Certificate of Authentication _
on the Bond and by inserting as the date of registration in the space provided the date on which
the Bond is authenticated, except that for purposes of delivering the original Bonds to the
Purchaser, the Bond Registrar shall insert as a date of registration the date of original issue,
which date is August 10, 2004. The Certificate of Authentication so executed on each Bond
shall be conclusive evidence that it has been authenticated and delivered under this resolution.
10. Registration: Transfer: Exchange. The City will cause to be kept at the principal
office of the Bond Registrar a bond register in which, subject to such reasonable regulations as
the Bond Registrar may prescribe, the Bond Registrar shall provide for the registration of Bonds
and the registration of transfers of Bonds entitled to be registered or transferred as herein
provided.
Upon surrender for transfer of any Bond at the principal office of the Bond Registrar, the
City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of
registration (as provided in paragraph 9) of, and deliver, in the name of the designated transferee
or transferees, one or more new Bonds of any Authorized Denomination or Denominations of a
like aggregate principal amount, having the same stated maturity and interest rate, as requested
by the transferor; provided, however, that no Bond may be registered in blank or in the name of
"bearer" or similar designation.
At the option ofthe Holder, Bonds may be exchanged for Bonds of any Authorized
Denomination or Denominations of a like aggregate principal amount and stated maturity, upon
surrender ofthe Bonds to be exchanged at the principal office of the Bond Registrar. Whenever _
any Bonds are so surrendered for exchange, the City shall execute (if necessary), and the Bond
I 664594vl
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Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the
e Holder making the exchange is entitled to receive.
All Bonds surrendered upon any exchange or transfer provided for in this resolution shall
be promptly canceled by the Bond Registrar and thereafter disposed of as directed by the City.
All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general
obligations of the City evidencing the same debt, and entitled to the same benefits under this
resolution, as the Bonds surrendered for such exchange or transfer.
Every Bond presented or surrendered for transfer or exchange shall be duly endorsed or
be accompanied by a written instrument of transfer, in form satisfactory to the Bond Registrar,
duly executed by the Holder thereof or the Holder's attorney duly authorized in writing.
The Bond Registrar may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection with the transfer or exchange of any Bond and any
legal or unusual costs regarding transfers and lost Bonds.
Transfers shall also be subject to reasonable regulations of the City contained in any
agreement with the Bond Registrar, including regulations which permit the Bond Registrar to
close its transfer books between record dates and payment dates. The City Manager is hereby
authorized to negotiate and execute the terms of said agreement.
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11. Rights Upon Transfer or Exchange. Each Bond delivered upon transfer of or in
exchange for or in lieu of any other Bond shall carry all the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Bond.
12. Interest Payment: Record Date. Interest on any Bond shall be paid on each
Interest Payment Date by check or draft mailed to the person in whose name the Bond is
registered (the "Holder") on the registration books of the City maintained by the Bond Registrar
and at the address appearing thereon at the close of business on the fifteenth day of the calendar
month next preceding such Interest Payment Date (the "Regular Record Date"). Any such
interest not so timely paid shall cease to be payable to the person who is the Holder thereof as of
the Regular Record Date, and shall be payable to the person who is the Holder thereof at the
close of business on a date (the "Special Record Date") fixed by the Bond Registrar whenever
money becomes available for payment of the defaulted interest. Notice of the Special Record
Date shall be given by the Bond Registrar to the Holders not less than ten days prior to the
Special Record Date.
13. Treatment of Registered Owner. The City and Bond Registrar may treat the
person in whose name any Bond is registered as the owner of such Bond for the purpose of
receiving payment of principal of and premium, if any, and interest (subject to the payment
provisions in paragraph 12) on, such Bond and for all other purposes whatsoever whether or not
such Bond shall be overdue, and neither the City nor the Bond Registrar shall be affected by
notice to the contrary.
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14. Delivery; Application of Proceeds. The Bonds when so prepared and executed
shall be delivered by the Finance Director to the Purchaser upon receipt of the purchase price, e
and the Purchaser shall not be obliged to see to the proper application thereof.
15. Fund and Accounts. There is hereby established a special fund to be designated
"General Obligation Bonds, Series 2004A Fund" (the "Fund") to be administered and maintained
by the Finance Director as a bookkeeping account separate and apart from all other funds
maintained in the official financial records of the City. The Fund shall be maintained in the
manner herein specified until all of the Bonds and the interest thereon have been fully paid. In
such records there shall be established accounts or accounts shall continue to be maintained as
the case may be, ofthe Fund for the purposes and in the amounts as follows:
(a) Capital Account. To the Capital Account there shall be credited the proceeds of
the sale of the Bonds, less accrued interest received thereon, less capitalized interest, plus any
special assessments levied with respect to the Improvements and collected prior to completion of
the Improvements and payment of the costs thereof. From the Capital Account there shall be
paid all costs and expenses of the Project, including the cost of any construction contracts
heretofore let and all other costs incurred and to be incurred of the kind authorized in Minnesota
Statutes, Section 475.65. Moneys in the Capital Account shall be used for no other purpose
except as otherwise provided by law; provided that the proceeds of the Bonds may also be used
to the extent necessary to pay interest on the Bonds due prior to the anticipated date of
commencement ofthe collection of taxes and special assessments herein levied or covenanted to
be levied; and provided further that if upon completion of the Project there shall remain any
unexpended balance in the Capital Account, the balance (other than any special assessments) e
shall be transferred to the Debt Service Account, and provided further that any special
assessments credited to the Capital Account shall only be applied towards payment of the costs
of the Improvements upon adoption of a resolution by the City Council determining that the
application of the special assessments for such purpose will not cause the City to no longer be in
compliance with Minnesota Statutes, Section 475.61, Subdivision 1.
(b) Debt Service Account. There shall be maintained three separate subaccounts in
the Debt Service Account to be designated the "Improvement Project Debt Service Subaccount",
the "Equipment Debt Service Subaccount" and "Capital Improvements Debt Service
Subaccount". There are hereby irrevocably appropriated and pledged to, and there shall be
credited to the separate sub accounts ofthe Debt Service Account:
(i)
hnprovement Proiect Debt Service Subaccount. To the Improvement Project
Debt Service Subaccount there shall be credited: (A) all collections of special
assessments herein covenanted to be levied with respect to the hnprovements and
either initially credited to the Capital Account and not already spent as permitted
above and required to pay any principal and interest due on the hnprovement
Portion of the Bonds or collected subsequent to the completion of the
hnprovements and payment of the costs thereof; (B) a pro rata share of all accrued
interest received upon delivery of the Bonds; (C) capitalized interest in the
amount of$14,107.51 (together with interest earnings thereon and subject to such
other adjustments as are appropriate to provide sufficient funds to pay interest due
on the hnprovement Portion ofthe Bonds on or before February 1, 2005); (D) a
pro rata share of all funds paid for the Bonds in excess of the minimum bid; (E)
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"
any collections of all taxes herein or hereinafter levied for the payment of the
Improvement Portion of the Bonds and interest thereon; (F) a pro rata share of all
funds remaining in the Capital Account after completion ofthe Project and
payment of the costs thereof; (G) all investment earnings on funds held in the
Improvement Project Debt Service Subaccount; and (H) any and all other moneys
which are properly available and are appropriated by the governing body ofthe
City to the Improvement Project Debt Service Subaccount. The Improvement
Project Debt Service Subaccount shall be used solely to pay the principal and
interest and any premiums for redemption of the Improvement Portion of the
Bonds and any other general obligation bonds of the City hereafter issued by the
City and made payable from said subaccount as provided by law.
(ii)
Equipment Debt Service Subaccount. To the Equipment Debt Service
Subaccount there shall be credited: (A) all taxes herein and hereafter levied for
the payment ofthe Equipment Portion of the Bonds; (B) a pro rata share of all
accrued interest received upon delivery of the Bonds; (C) capitalized interest in
the amount of $10,046.25 (together with interest earnings thereon and subject to
such other adjustments as are appropriate to provide sufficient funds to pay
interest due on the Equipment Portion of the Bonds on or before February 1,
2005); (D) a pro rata share of all funds paid for the Bonds in excess ofthe
minimum bid; (E) a pro rata share of all funds remaining in the Capital Account
after completion of the Project and payment of the costs thereof; (F) all
investment earnings on funds held in the Equipment Debt Service Subaccount;
and (G) any and all other moneys which are properly available and are
appropriated by the governing body ofthe City to the Equipment Debt Service
Subaccount. The Equipment Debt Service Subaccount shall be used solely to pay
the principal and interest and any premiums for redemption of the Equipment
Portion of the Bonds.
(iii) Capital Improvements Debt Service Subaccount. To the Capital Improvements
Debt Service Subaccount there shall be credited: (A) all taxes herein and
hereafter levied for the payment of the Capital Improvements Portion of the
Bonds; (B) a pro rata share of all accrued interest received upon delivery ofthe
Bonds; (C) capitalized interest in the amount of$4,435.31; (D) any collections of
all taxes herein or hereinafter levied for the payment of the Capital Improvements
Portion of the Bonds and interest thereon; (E) a pro rata share of all funds
remaining in the Capital Account after completion ofthe Capital Improvements
and payment of the costs thereof; (F) all investment earnings on funds held in the
Capital Improvements Debt Service Subaccount; and (G) any and all other
moneys which are properly available and are appropriated by the governing body
of the City to the Capital Improvements Debt Service Subaccount. The Capital
Improvements Debt Service Subaccount shall be used solely to pay the principal
and interest and any premiums for redemption of the Capital Improvements
Portion of the Bonds and any other general obligation bonds of the City hereafter
issued by the City and made payable from said subaccount as provided by law.
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No portion of the proceeds of the Bonds shall be used directly or indirectly to acquire
higher yielding investments or to replace funds which were used directly or indirectly to acquire e
higher yielding investments, except (1) for a reasonable temporary period until such proceeds are
needed for the purpose for which the Bonds were issued and (2) in addition to the above in an
amount not greater than the lesser of five percent ofthe proceeds ofthe Bonds or $100,000. To
this effect, any proceeds of the Bonds and any sums from time to time held in the Capital
Account or Debt Service Account (or any other City account which will be used to pay principal
or interest to become due on the bonds payable therefrom) in excess of amounts which under
then applicable federal arbitrage regulations may be invested without regard to yield shall not be
invested at a yield in excess of the applicable yield restrictions imposed by said arbitrage
regulations on such investments after taking into account any applicable "temporary periods" or
"minor portion" made available under the federal arbitrage regulations. Money in the Fund shall
not be invested in obligations or deposits issued by, guaranteed by or insured by the United
States or any agency or instrumentality thereof if and to the extent that such investment would
cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b) of the
Internal Revenue Code of 1986, as amended (the "Code").
16. Covenants Relating to the Imvrovement Portion of the Bonds.
(a) Assessments. It is hereby determined that no less than twenty percent of the cost
to the City of each of the Improvements financed hereunder within the meaning of Minnesota
Statutes, Section 475.58, Subdivision 1(3), shall be paid by special assessments to be levied
against every assessable lot, piece and parcel ofland benefitted by any of the Improvements.
The City hereby covenants and agrees that it will let all construction contracts not heretofore let
within one year after ordering each of the Improvements financed hereunder unless the
resolution ordering the Improvements specifies a different time limit for the letting of
construction contracts. The City hereby further covenants and agrees that it will do and perform
as soon as they may be done all acts and things necessary for the fmal and valid levy of such
special assessments, and in the event that any such assessment be at any time held invalid with
respect to any lot, piece or parcel of land due to any error, defect, or irregularity in any action or
proceedings taken or to be taken by the City or the City Councilor any of the City officers or
employees, either in the making of the assessments or in the performance of any condition
precedent thereto, the City and the City Council will forthwith do all further acts and take all
further proceedings as may be required by law to make the assessments a valid and binding lien
upon such property. It is hereby determined that the assessments shall be payable in equal,
consecutive, annual installments, with general taxes for the years shown below and with interest
on the declining balance of all such assessments at a rate per annum not greater than the
maximum permitted by law and not less than the rates per annum shown opposite their collection
years specified below:
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Designation Amount Levy Years Years Rate
2004 Street Improvements, $220,000 2004 - 2013 2005 - 2014 6.00%
Project 04-01
2004 Street Improvements, $350,000 2004 - 2011 2005 - 2012 6.00%
Project 04-02
At the time the assessments are in fact levied the City Council shall, based on the then-
current estimated collections of the assessments, make any adjustments in any ad valorem taxes
required to be levied in order to assure that the City continues to be in compliance with
Minnesota Statutes, Section 475.61, Subdivision 1.
(b) Tax Levy: Coverage Test. To provide moneys for payment of the principal and
interest on the Improvement Portion of the Bonds there is hereby levied upon all of the taxable
property in the City a direct annual ad valorem tax which shall be spread upon the tax rolls and
collected with and as part of other general property taxes in the City for the years and in the
amounts as follows:
Year of Tax LevY
Year of Tax Collection
Amount
2004-2013
2005-2014
See attached levy schedule
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The tax levies are such that if collected in full they, together with estimated collections of
special assessments and other revenues herein pledged for the payment of the Improvement
Portion of the Bonds, will produce at least five percent in excess of the amount needed to meet
when due the principal and interest payments on the Improvement Portion of the Bonds. The tax
levies shall be irrepealable so long as any of the Improvement Portion of the Bonds are
outstanding and unpaid, provided that the City reserves the right and power to reduce the levies
in the manner and to the extent permitted by Minnesota Statutes, Section 475.61, Subdivision 3.
17. Covenants Relating to the Equipment Portion of the Bonds. To provide moneys
for payment of the principal and interest on the Equipment Portion of the Bonds there is hereby
levied upon all of the taxable property in the City a direct annual ad valorem tax which shall be
spread upon the tax rolls and collected with and as part of other general property taxes in the City
for the years and in the amounts as follows:
Year of Tax Levy
Year of Tax Collection
Amount
2004 - 2007
2005 - 2008
See Attached Levy Schedule
The tax levies are such that if collected in full they, together with other revenues herein
pledged for the payment of the Equipment Portion ofthe Bonds, will produce at least 5% in
excess of the amount needed to meet when due the principal and interest payments on the
Equipment Portion of the Bonds. The tax levies shall be irrepealable so long as any of the
Equipment Portion of the Bonds are outstanding and unpaid, provided that the City reserves the
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Tax Levy Calculation For:
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City of Chanhassen, Minnesota
$2,070,000 General Obligation Bonds, Series 2004A
Dated Date: 8/10/2004
$985,000 G.O. Improvement Portion (Project #'s 04-01 and 04-02):
(2) (3) (4)
Levy Collect Pay Total Funds P&I Less: Less: Net Tax
Year Year Year P&I Available (1) x 105% Spec Assmts Spec Assmts Levy Levy
2003 / 2004 / 2005 14,107.51 14,107.51 0.00 0.00 0
2004 / 2005 / 2006 174,700.00 183,435.00 29,890.95 56,362.58 97,181.47 97,200
2005 / 2006 / 2007 176,075.00 184,878.75 29,890.95 56,362.58 98,625.22 98,700
2006 / 2007 / 2008 177,325.00 186,191.25 29,890.95 56,362.58 99,937.72 100,000
2007 / 2008 / 2009 178,062.50 186,965.63 29,890.95 56,362.58 100,712.09 100,800
2008 / 2009 / 2010 128,262.50 134,675.63 29,890.95 56,362.58 48,422.09 48,500
2009 / 2010 / 2011 79,525.00 83,501.25 29,890.95 56,362.58 -2,752.28 0
2010 / 2011 / 2012 77,075.00 80,928.75 29,890.95 56,362.58 -5,324.78 0
2011 / 2012 / 2013 74,625.00 78,356.25 29,890.95 56,362.58 -7,897.28 0
2012 / 2013 / 2014 27,000.00 28,350.00 29,890.95 -1,540.95 0
2013 / 2014 / 2015 26,000.00 27,300.00 29,890.95 -2,590.95 0
Totals 1,132,757.51 14,107.51 1,174,582.50 298,909.51 450,900.64 424,772.35 445,200.00
(1) The following funds are available to pay the interest payment due February 1, 2005: e
Capitalized Interest: $14,107.51
(2) Projected Special Assessment revenue based on $220,000 assessed at 6.00%.
(3) Projected Special Assessment revenue based on $350,000 assessed at 6.00%.
(4) Cashflow and levy needs should be reviewed annually to account for prepaid and/or delinquent assessments.
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e Tax Levy Calculation For:
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City of Chanhassen, Minnesota
$2,070,000 General Obligation Bonds, Series 2004A
Dated Date: 8/10/2004
$785,000 G.O. Equipment Certificates Portion:
Levy Collect Pay Total Funds
Year Year Year P&I Available (1)
2003 / 2004 / 2005 10,046.25 10,046.25
2004 / 2005 / 2006 211,150.00
2005 / 2006 / 2007 206,400.00
2006 / 2007 / 2008 211,650.00
2007 / 2008 / 2009 211,150.00
Totals 850,396.25 10,046.25
P&I Net Tax
x 105% Levy Levy
0.00 0.00 0
221,707.50 221,707.50 221,800
216,720.00 216,720.00 216,800
222,232.50 222,232.50 222,300
221,707.50 221,707.50 221,800
882,367.50 882,367.50 882,700.00
Capitalized Interest:
(1) The following funds are available to pay the interest payment due February 1, 2005:
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$10,046.25
right and power to reduce the levies in the manner and to the extent permitted by Minnesota
Statutes, Section 475.61, Subdivision 3.
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18. Covenants Relating to the Capital hnprovements Portion of the Bonds. To
provide moneys for payment of the principal and interest on the Capital hnprovements Portion of
the Bonds there is hereby levied upon all of the taxable property in the City a direct annual ad
valorem tax which shall be spread upon the tax rolls and collected with and as part of other
general property taxes in the City for the years and in the amounts as follows:
Year of Tax Levy
Year of Tax Collection
Amount
2004 - 2008
2005 - 2009
See Attached Levy Schedule
The tax levies are such that if collected in full they, together with other revenues herein
pledged for the payment of the Capital hnprovements Portion of the Bonds, will produce at least
5% in excess of the amount needed to meet when due the principal and interest payments on the
Capital hnprovements Portion of the Bonds. The tax levies shall be irrepealable so long as any
of the Capital hnprovements Portion of the Bonds are outstanding and unpaid, provided that the
City reserves the right and power to reduce the levies in the manner and to the extent permitted
by Minnesota Statutes, Section 475.61, Subdivision 3.
19. General Obligation Pledge. For the prompt and full payment of the principal and
interest on the Bonds, as the same respectively become due, the full faith, credit and taxing
powers of the City shall be and are hereby irrevocably pledged. If the balance in the Debt
Service Account is ever insufficient to pay all principal and interest then due on the Bonds and
any other bonds payable therefrom, the deficiency shall be promptly paid out of any other funds
of the City which are available for such purpose, and such other funds may be reimbursed with
or without interest from the Debt Service Account when a sufficient balance is available therein.
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20. Defeasance. When all Bonds have been discharged as provided in this paragraph,
all pledges, covenants and other rights granted by this resolution to the registered holders of the
Bonds shall, to the extent permitted by law, cease. The City may discharge its obligations with
respect to any Bonds which are due on any date by irrevocably depositing with the Bond
Registrar on or before that date a sum sufficient for the payment thereof in full; or if any Bond
should not be paid when due, it may nevertheless be discharged by depositing with the Bond
Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such
deposit. The City may also discharge its obligations with respect to any prepayable Bonds called
for redemption on any date when they are prepayable according to their terms, by depositing
with the Bond Registrar on or before that date a sum sufficient for the payment thereof in full,
provided that notice of redemption thereof has been duly given. The City may also at any time
discharge its obligations with respect to any Bonds, subject to the provisions of law now or
hereafter authorizing and regulating such action, by depositing irrevocably in escrow, with a
suitable banking institution qualified by law as an escrow agent for this purpose, cash or
securities described in Minnesota Statutes, Section 475.67, Subdivision 8, bearing interest
payable at such times and at such rates and maturing on such dates as shall be required, without
regard to sale and/or reinvestment, to pay all amounts to become due thereon to maturity or, if
notice of redemption as herein required has been duly provided for, to such earlier redemption
date.
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1664594vl
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e Tax Levy Calculation For:
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City of Chanhassen, Minnesota
$2,070,000 General Obligation Bonds, Series 2004A
Dated Date: 8/10/2004
$300,000 G.O. City Hall Portion:
Levy Collect Pay Total Funds
Year Year Year P&I Available (1)
2003 / 2004 / 2005 4,435.31 4,435.31
2004 / 2005 / 2006 29,337.50
2005 / 2006 / 2007 28,837.50
2006 / 2007 / 2008 23,337.50
2007 / 2008 / 2009 22,925.00
2008 / 2009 / 2010 237,475.00
Totals 346,347.81 4,435.31
P&I Net Tax
x 105% Levy Levy
0.00 0.00 0
30,804.38 30,804.38 30,900
30,279.38 30,279.38 30,300
24,504.38 24,504.38 24,600
24,071.25 24,071.25 24,100
249,348.75 249,348.75 249,400
359,008.13 359,008.13 359,300.00
Capitalized Interest:
(1) The following funds are available to pay the interest payment due February 1, 2005:
$4,435.31
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21. Compliance With Reimbursement Bond Regulations. The provisions of this
paragraph are intended to establish and provide for the City's compliance with United States e
TreasuryRegulations Section 1.150-2 (the "Reimbursement Regulations") applicable to the
"reimbursement proceeds" of the Bonds, being those portions thereof which will be used by the
City to reimburse itself for any expenditure which the City paid or will have paid prior to the
Closing Date (a "Reimbursement Expenditure").
The City hereby certifies and/or covenants as follows:
(a) Not later than 60 days after the date of payment of a Reimbursement Expenditure,
the City (or person designated to do so on behalf of the City) has made or will have made a
written declaration of the City's official intent (a "Declaration") which effectively (i) states the
City's reasonable expectation to reimburse itselffor the payment of the Reimbursement
Expenditure out of the proceeds of a subsequent borrowing; (ii) gives a general and functional
description of the property, project or program to which the Declaration relates and for which the
Reimbursement Expenditure is paid, or identifies a specific fund or account of the City and the
general functional purpose thereof from which the Reimbursement Expenditure was to be paid
(collectively the "Project"); and (iii) states the maximum principal amount of debt expected to be
issued by the City for the purpose offinancing the Project; provided, however, that no such
Declaration shall necessarily have been made with respect to: (i) "preliminary expenditures" for
the Project, defined in the Reimbursement Regulations to include engineering or architectural,
surveying and soil testing expenses and similar prefatory costs, which in the aggregate do not
exceed 20% of the "issue price" of the Bonds, and (ii) a de minimis amount of Reimbursement
Expenditures not in excess ofthe lesser of $100,000 or 5% of the proceeds of the Bonds. e
(b) Each Reimbursement Expenditure is a capital expenditure or a cost of issuance of
the Bonds or any of the other types of expenditures described in Section 1.150-2( d)(3) of the
Reimbursement Regulations.
(c) The "reimbursement allocation" described in the Reimbursement Regulations for
each Reimbursement Expenditure shall and will be made forthwith following (but not prior to)
the issuance of the Bonds and in all events within the period ending on the date which is the later
of three years after payment of the Reimbursement Expenditure or one year after the date on
which the Project to which the Reimbursement Expenditure relates is first placed in service.
(d) Each such reimbursement allocation will be made in a writing that evidences the
City's use of Bond proceeds to reimburse the Reimbursement Expenditure and, ifmade within 30
days after the Bonds are issued, shall be treated as made on the day the Bonds are issued.
Provided, however, that the City may take action contrary to any of the foregoing
covenants in this paragraph upon receipt of an opinion of its Bond Counsel for the Bonds stating
in effect that such action will not impair the tax-exempt status of the Bonds.
22. Continuing Disclosure. The City is the sole obligated person with respect to the
Bonds. The City hereby agrees, in accordance with the provisions of Rule 15c2-12 (the "Rule"),
promulgated by the Securities and Exchange Commission (the "Commission") pursuant to the
Securities Exchange Act of 1934, as amended, and a Continuing Disclosure Undertaking (the e
"Undertaking") hereinafter described to:
1664594vl
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(a) Provide or cause to be provided to each nationally recognized municipal securities
information repository ("NRMSIR") and to the appropriate state information depository ("SID"),
if any, for the State of Minnesota, in each case as designated by the Commission in accordance
with the Rule, certain annual financial information and operating data in accordance with the
Undertaking. The City reserves the right to modify from time to time the terms of the
Undertaking as provided therein.
(b) Provide or cause to be provided, in a timely manner, to (i) each NRMSIR or to the
Municipal Securities Rulemaking Board ("MSRB") and (ii) the SID, notice of the occurrence of
certain material events with respect to the Bonds in accordance with the Undertaking.
(c) Provide or cause to be provided, in a timely manner, to (i) each NRMSIR or to the
MSRB and (ii) the SID, notice of a failure by the City to provide the annual financial information
with respect to the City described in the Undertaking.
(d) The City agrees that its covenants pursuant to the Rule set forth in this paragraph
and in the Undertaking is intended to be for the benefit of the Holders of the Bonds and shall be
enforceable on behalf of such Holders; provided that the right to enforce the provisions of these
covenants shall be limited to a right to obtain specific enforcement of the City's obligations under
the covenants.
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The Mayor and City Manager of the City, or any other officer of the City authorized to
act in their place (the "Officers") are hereby authorized and directed to execute on behalf of the
City the Undertaking in substantially the form presented to the City Council subject to such
modifications thereof or additions thereto as are (i) consistent with the requirements under the
Rule, (ii) required by the Purchaser of the Bonds, and (ii) acceptable to the Officers.
23. Certificate of Registration. A certified copy of this resolution is hereby directed
to be filed in the offices of the County Auditor of Carver County and the Director of Property
Tax and Public Records of Hennepin County, Minnesota together with such other information as
the County Auditor and Director shall require, and to obtain the County Auditor's and Director's
Certificates that the Bonds have been entered in their respective Bond Registers.
24. Records and Certificates. The officers of the City are hereby authorized and
directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality ofthe
issuance of the Bonds, certified copies of all proceedings and records of the City relating to the
Bonds and to the financial condition and affairs of the City, and such other affidavits, certificates
and information as are required to show the facts relating to the legality and marketability of the
Bonds as the same appear from the books and records under their custody and control or as
otherwise known to them, and all such certified copies, certificates and affidavits, including any
heretofore furnished, shall be deemed representations ofthe City as to the facts recited therein.
25. Negative Covenant as to Use of Bond Proceeds and Proiect. The City hereby
covenants not to use the proceeds of the Bonds or to use the Project, or to cause or permit them
to be used, or to enter into any deferred payment arrangements for the cost of the Project, 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.
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22
26. Tax-Exempt Status of the Bonds: Rebate. The City shall comply with
requirements necessary under the Code to establish and maintain the exclusion from gross _
income under Section 103 of the Code of the interest on the Bonds, including without limitation
(a) requirements relating to temporary periods for investments, (b) limitations on amounts
invested at a yield greater than the yield on the Bonds, and (c) the rebate of excess investment
earnings to the United States. The City expects to satisfy the twenty-four month expenditure
exemption for gross proceeds of the Bonds as provided in Section 1. 148-7(e)(1) of the
Regulations. If any elections are available now or hereafter with respect to arbitrage or rebate
matters relating to the Bonds, the Mayor, the City Manag~r, or either of them, are hereby
authorized and directed to make such elections as they deem necessary, appropriate or desirable
in connection with the Bonds, and all such elections shall be, and shall be deemed and treated as,
elections of the City.
27. Designation of Oualified 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 hereby makes the following factual statements and representations:
(a) the Bonds are issued after August 7, 1986;
(b) the Bonds are not "private activity bonds" as defined in Section 141 of the Code;
(c) the City hereby designates the Bonds as "qualified tax-exempt obligations" for
purposes of Section 265(b)(3) of the Code;
(d) the reasonably anticipated amount of tax-exempt obligations (other than private e
activity bonds, treating qualified 501 (c)(3) bonds as not being private activity bonds) which will
be issued by the City (and all entities treated as one issuer with the City, and all subordinate
entities whose obligations are treated as issued by the City) during this calendar year 2004 will
not exceed $10,000,000; and
(e) not more than $10,000,000 of obligations issued by the City during this calendar
year 2004 have been designated for purposes of Section 265(b )(3) of the Code.
The City shall use its best efforts to comply with any federal procedural requirements
which may apply in order to effectuate the designation made by this paragraph.
28. Payment ofIssuance Expenses. The City authorizes the Purchaser to forward the
amount of Bond proceeds allocable to the payment of issuance expenses to U.S. Trust Company,
N.A., Minneapolis, Minnesota on the closing date for further distribution as directed by the
City's financial advisor, Ehlers.
29. Severability. If any section, paragraph or provision of this resolution shall be held
to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section,
paragraph or provision shall not affect any of the remaining provisions of this resolution.
30. Headings. Headings in this resolution are included for convenience of reference
only and are not a part hereof, and shall not limit or define the meaning of any provision hereof.
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.
, '
The motion for the adoption of the foregoing resolution was duly seconded by member
Lundquist and, after a full discussion thereof and upon a vote being taken thereon, the following
voted in favor thereof:
Furlong, Ayotte, Labatt, Lundquist, Peterson
and the following voted against the same:
None
Whereupon the resolution was declared duly passed and adopted.
1664594vl
24
STATE OF MINNESOTA
COUNTIES OF CARVER AND HENNEPIN
CITY OF CHANHASSEN
I, the undersigned, being the duly qualified and acting City Manager of the City of
Chanhassen, Minnesota, DO HEREBY CERTIFY that I have compared the attached and
foregoing extract of minutes with the original thereof on file in my office, and that the same is a
full, true and complete transcript of the minutes of a meeting of the City Council, duly called and
held on the date therein indicated, insofar as such minutes relate to authorizing the issuance and
awarding the sale of '$,2,070, OOOJ-eneral Obligation Bonds, Series 2004A.
WITNESS my hand on July 12, 20~
w..!\~
ity Manager
1664594vl
25
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BID TABULATION
,
,
$2,115,000* General Obligation Bonds, Series 2004A
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CITY OF CHANHASSEN, MINNESOTA
SALE: July 12, 2004
AWARD: CITIGROUP GLOBAL MARKETS, INC.
NAME OF BIDDER
BBI: 4.81%
NET TRUE
MATURITY RATE REOFFERING PRICE INTEREST INTEREST
(Febr,uary 1) YIELD COST RATE
2006 2.500% 1.950% $2,114,754.20 $264,627.99 3.0911%
2007 2.500% 2.250%
2008 2.750% 2.650%
2009 3.000% 2.875%
2010 3.250% 3.050%
2011 3.500% 3.250%
2012 3.500% 3.450%
2013 3.750% 3.625%
2014 4.000% 3.750%
2015 4.000% 3.875%
RATING: Standard & Poor's "AA-"
CITIGROUP GLOBAL MARKETS, INC.
Chicago, Illinois
UBS FINANCIAL SERVICES INC.
Chicago, Illinois
CRONIN & CO., INC.
Minneapolis, Minnesota
CIBC WORLD MARKETS
New York, New York
CITIZENS BANK
Flint, Michigan
MORGAN STANLEY & CO. INCORPORATED
New York, New York
KIRLIN SECURITIES, INC.
Syosset, New York
L. MASON WOOD WALKER, INC.
eapolis, Minnesota
2006 3.000%
2007 3.000%
2008 3.250%
2009 3.250%
2010 3.250%
2011 3.400%
2012 3.500%
2013 3.650%
2014 3.850%
2015 4.000%
2006 3.000%
2007 3.000%
2008 3.250%
2009 3.500%
2010 3.500%
2011 3.500%
2012 3.500%
2013 3.700%
2014 3.800%
2015 3.900%
$2,128,539.39 $267,640.36 3.1189%
PIPER JAFFRAY & CO.
Minneapolis, Minnesota
WELLS FARGO BROKERAGE SERVICES LLC
Minneapolis, Minnesota
$2,135,755.50 $270,016.00 3.1392%
*Subsequent to bid opening the issue size was decreased to $2,070,000 with the 2006 maturity decreased $5,000 to $355,000, the 2007
maturity decreased $10,000 to $360,000, the 2008 maturity decreased $10,000 to $370,000, the 2009 maturity decreased $10,000 to
$380,000, and the 2010 maturity decreased $10,000 to $345,000 in maturity value.
Adjusted Price - $2,069,766.54
Adjusted Net Interest Cost - $259,735.02
Aeed TIC -3.0942%
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113.1105
651.697.8500 fax 651.697.8555 www.ehlers-inc.com
Offices in Rosevi/le, MN, Brookfield, WI and Napervi/le, IL
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EHLERS