2004-47c
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EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE
CITY OF CHANHASSEN, MlNNESOTA
HELD: JULY 12,2004
Pursuant to due call and notice thereof, a regular meeting ofthe City Council ofthe City
of Chanhassen, Carver and Hennepin Counties, Minnesota, was du1y called and 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$I,170,000 Taxable General Obligation Tax mcrement Refunding Bonds,
Series 2004C.
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 2004-47C
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF
$1,170,000 TAXABLE GENERAL OBLIGATION TAX INCREMENT
REFUNDING BONDS, SERIES 2004C; PLEDGING TAX
INCREMENTS FOR THE SECURITY THEREOF AND AUTHORIZING
EXECUTION OF A PLEDGE AGREEMENT
A. WHEREAS, the Economic Development Authority of the City of Chanhassen,
Minnesota (the "Authority"), has jurisdiction over the Redevelopment Plan (the "Redevelopment
Plan") for the Downtown Chanhassen Redevelopment Project Area (the "Project Area"),
heretofore established by the Housing and Redevelopment Authority in and for the City of
Chanhassen, Minnesota (the "HRA"), all pursuant to the provisions of Minnesota Statutes,
Sections 469.001 through 469.047 and 469.090 through 469.1081 (collectively, the "Act"); and
B. WHEREAS, Tax mcrement District No.4 has been established by the City of
Chanhassen, Minnesota (the "City"), as a redevelopment district within the Project Area (the
"Tax mcrement District") under the provisions of Minnesota Statutes, Sections 469.174 through
469.179 and the City has approved a tax increment financing plan and amendments (the "Plan")
with respect to the Tax mcrement District and the Authority has accepted jurisdiction over the
Tax mcrement District; and
C. WHEREAS, a Contract for Private Redevelopment by and between the HRA and
Bloomberg Companies mcorporated was entered into and a $360,000 Limited Revenue Tax
mcrement Note, dated December 31, 1998, was issued as a special limited obligation of the HRA
to aid in fmancing a project ofthe HRA, consisting generally of defraying certain capital and
administration costs incurred and to be incurred in connection with the Project Area (the
"Frontier Note"); and
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D. WHEREAS, a Contract for Private Redevelopment by and between the HRA and .
Chanhassen Properties, LLC, was entered into and a $540,000 Limited Revenue Tax Increment
Note, dated August 8,1997, was issued as a special limited obligation of the HRA to aid in
financing a project of the HRA, consisting generally of defraying certain capital and
administration costs incurred and to be incurred in connection with the Project Area (the
"Chanhassen Properties Note"); and
E. WHEREAS, the Frontier Note and the Chanhassen Properties Note are herein
collectively referred to as the "Prior Notes"; and
F. WHEREAS, the Prior Notes may be prepaid at anytime at the option of the
Authority by paying the remaining principal balance on the Prior Notes plus accrued and unpaid
interest thereon; and
G. WHEREAS, the City Council deems it desirable and in the best interests of the
City to provide funds to the Authority to be used to prepay all of the outstanding principal and
accrued and unpaid interest on the Prior Notes in order to reduce debt service costs to the City;
and
H. WHEREAS, the City Council has heretofore determined and declared that it is
necessary and expedient to issue $1,170,000 Taxable General Obligation Tax Increment
Refunding Bonds, Series 2004C (the "Bonds" or individually, a "Bond"), pursuant to Minnesota
:'~tutes, Chapters 469 and 475, to pay on August 10, 2004, the Prior Notes (the "Refunding"); .
1. WHEREAS, the City has retained Ehlers & Associates, Inc., in Roseville,
Minnesota ("Ehlers"), as its independent financial advisor for the sale of the Bonds and was
therefore authorized to sell the Bonds by private negotiation in accordance with Minnesota
Statutes, Section 475.60, Subdivision 2(9) and proposals to purchase the Bonds have been
solicited by Ehlers; and
J. WHEREAS, the proposals set forth on Exhibit A attached hereto were received
by the City Manager, or designee, at the officers of Ehlers at 12:00 noon this same day pursuant
to the Terms of Proposal established for the Bonds; and
K. WHEREAS, it is in the best interests of the City that the Bonds be issued in book-
entry form as hereinafter provided; and
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Chanhassen,
Minnesota, as follows:
1. Acceptance of Proposal. The proposal ofCitigroup Global Markets, Inc. (the
"Purchaser"), to purchase the Bonds in accordance with the Terms of Proposal, at the rates of
interest hereinafter set forth, and to pay therefor the sum of$I,159,736.20, plus interest accrued
to settlement, is hereby found, determined and declared to be the most favorable proposal
received and 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 their good faith checks or drafts.
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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 as fully registered bonds. The Bonds shall be numbered from R -1 upward in the
denomination of $5,000 each or in any integral multiple thereof of a single maturity (the
"Authorized Denominations"). The Bonds shall mature on February 1 in the years and amounts
as follows:
Year Amount Year Amount
2006 $50,000 2014 $70,000
2007 50,000 2015 75,000
2008 55,000 2016 80,000
2009 55,000 2017 85,000
2010 60,000 2018 90,000
2011 60,000 2019 95,000
2012 65,000 2020 100,000
2013 70,000 2021 110,000
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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 final maturity amounts conforming to the foregoing principal
repayment schedule, and corresponding additions may be made to the provisions of the
applicable Bond(s).
(b) 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:
(i) The Bonds shall be initially issued and, so long as they remain in book
entry form only (the "Book Entry Only Period"), shall at all times be in the form of a
separate single fully registered Bond for each maturity of the Bonds; and for purposes of
complying with this requirement under paragraphs 5 and 10 Authorized 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").
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(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
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the immediately preceding sentence, neither the City, nor the Bond Registrar, shall have e
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 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 for the purpose of payment of the principal of and
premium, if any, and interest on the Bonds, for the purpose of giving notices of
redemption and other matters with respect to the Bonds, for the purpose of obtaining any
consent or other action to be taken by Holders for the purpose of registering transfers
with respect to such Bonds, and for all purpose whatsoever. The Bond Registrar, as
paying agent hereunder, shall pay all principal of and premium, if any, and interest on the
Bonds only to the Holder or the Holders ofthe 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 hereof,
references to the Nominee hereunder shall refer to such new Nominee.
(vi) So long as any Bond is registered in the name of a Nominee, all payments
with respect to the principal of and premium, if any, and interest on such Bond and all
notices with respect to such Bond shall be made and given, respectively, by the Bond
Registrar or 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. e
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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 agency /bond 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
hereof, make a notation of the reduction in principal amount on the panel provided on the
Bond stating the amount so redeemed.
(c) Termination of Book-Entry Only System. Discontinuance of a particular
Depository's services and termination of the book-entry only system maybe effected as follows:
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(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.
(ii) Upon termination ofthe services ofthe 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 hereof. To the extent that
the Beneficial Owners are designated as the transferee by the Holders, in accordance with
paragraph 10 hereof, the Bonds will be delivered to the Beneficial Owners.
(iii) Nothing in this subparagraph (c) shall limit or restrict the provisions of
paragraph 10 hereof.
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(d) 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
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such provisions are inconsistent with the other provisions of this resolution, the provisions in the _
Letter of Representations shall control.
3. Purpose. The Bonds (together with other available funds, if any, appropriated in
paragraph 15) shall provide funds to finance the Refunding. It is hereby found, determined and
declared that the Refunding is pursuant to Minnesota Statutes, Section 475.67, and shall result in
a reduction of debt service cost to the City. Pursuant to the Contracts for Private Redevelopment
referred to in Whereas Clauses C and D hereof, tax increments have been pledged to the payment
of the Prior Notes. Pursuant to a Pledge Agreement dated August 10, 2004, entered into between
the Authority and the City, tax increments have been pledged to the payment of the Bonds and
interest thereon.
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 3O-day months, at the respective rates per
annum set forth opposite the maturity years as follows:
Maturity Interest Maturity Interest
Year Rate Year Rate
2006 3.00% 2014 5.20%
2007 3.20% 2015 5.20%
2008 3.65% 2016 5.40% e
2009 4.05% 2017 5.40%
2010 4.60% 2018 5.70%
2011 4.60% 2019 5.70%
2012 5.00% 2020 6.00%
2013 5.00% 2021 6.00%
5. Redemption. All Bonds maturing on February 1, 2014, and thereafter, shall be
subject to redemption and prepayment at the option of the City on February 1, 2013, and on any
date thereafter at a price of par plus accrued interest. Redempti{)n may be in whole or in part of
the Bonds subject to prepayment. Ifredemption is in part, those Bonds remaining unpaid which
have the latest maturity date shall be prepaid first; 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 (30) days prior to the date fixed for
redemption.
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
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redeemed shall be the Bonds to which were assigned numbers so selected; provided, however,
that only so much of the principal amount of each such Bond of a denomination of more than
$5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If
a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the
City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the
City 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) of the Bonds in the manner set forth in the form of Bond and in paragraph 12.
7. Form of Bond. The Bonds, together with this 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-
$
TAXABLE GENERAL OBLIGATION TAX INCREMENT
BOND, SERIES 2004C
Interest Rate
Maturity Date
Date of Original Issue
CUSIP
%
-
FEBRUARY 1,_
AUGUST 10,2004
REGISTERED OWNER:
CEDE & CO.
PRINCIPAL AMOUNT:
DOLLARS
The CityofChanhassen, 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 in the manner hereinafter set forth, the principal amount
specified above, unless called for earlier redemption, 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 e
(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, ifno 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. 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 of the Depository or its Nominee as
provided in the Resolution hereinafter described, and as those terms are defined 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 _
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this Bond. Until termination of the book-entry only system pursuant to the Resolution, Bonds
may only be registered in the name of the Depository or its Nominee.
THE ISSUER HAS ELECTED TO ISSUE THIS BOND AS A TAXABLE
OBLIGATION, AND ACCORDINGLY THE INTEREST ON THE BOND IS INTENDED TO
BE INCLUDED IN GROSS INCOME FOR FEDERAL INCOME TAXATION PURPOSES
AND, TO THE SAME EXTENT, IN BOTH GROSS INCOME AND TAXABLE NET
INCOME FOR STATE INCOME TAXATION PURPOSES.
Redemption. All Bonds of this issue (the "Bonds") maturing on February 1, 2014, and
thereafter, shall be subject to redemption and prepayment at the option of the Issuer on
February 1,2013, 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, those
Bonds remaining unpaid which have the latest maturity date shall be prepaid first; 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 (30) 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 ofthe 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 the 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 ofthe principal amount of Bond ofa 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
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 $1,170,000, all of like 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 ofthe 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
prepay the outstanding principal and accrued and unpaid interest on the Limited Revenue Tax
Increment Note, dated August 8, 1997, of the Housing and Redevelopment Authority in and for
the City of Chanhassen, Minnesota (the "HRA"), and the Limited Revenue Tax Increment Note,
1663912vl
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dated December 31, 1998, of the HRA. This Bond is payable out of the Taxable General _
Obligation Tax Increment Refunding Bonds, Series 2004C Fund of the Issuer. This Bond .
constitutes a general obligation of the 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; Exchan~e; 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
provided in the Resolution. Reference is hereby made to the Resolution for a description of the
rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal
office of the Bond Registrar.
Transfer. This Bond is transferable by the Holder in person or by 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.
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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 Recistered 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 on the reverse side hereof 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
entitled to any security unless the Certificate of Authentication hereon shall have been executed
by the Bond Registrar.
Not Qualified Tax-Exempt Obligations. The Bonds have not been designated by the
Issuer as "qualified tax-exempt obligations" for purposes of Section 265(b )(3) ofthe Internal
Revenue Code of 1986, as amended.
Taxable Interest. The interest on this Bond is included in the gross income of the owner
hereof for purposes of United States income tax and, to the same extent, in both gross income
and net taxable income for purposes of State of Minnesota income tax.
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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 on 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 of Chanhassen, Carver and Hennepin Counties,
Minnesota, by its City Council has caused this Bond to be executed on its behalf by the
signatures of its Mayor and its City Manager, the corporate seal of the Issuer having been
intentionally omitted as permitted by law.
Date of Registration:
Registrable by:
Payable at:
BOND REGISTRAR'S
CERTIFICATE OF
AUTHENTICATION
This Bond is one of the Bonds
described in the Resolution
mentioned within.
CITY OF CHANHASSEN,
CARVER AND HENNEPIN COUNTIES,
MINNESOTA
/s/ Facsimile
Mayor
, Minnesota
Bond Registrar
/s/ Facsimile
City Manager
By:
Authorized Signature
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ABBREVIATIONS
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The following abbreviations, when used in the inscription on the face of this Bond, shall
be construed as though they were written out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
UTMA - as custodian for
(Cust)
(Minor)
Uniform Transfers to Minors Act
under the
(State)
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 premises.
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:
AUTHORIZED
SIGNATURE
DATE AMOUNT OF HOLDER
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8. Execution: Temporary Bonds. The Bonds shall be printed (or, at the request of e
the Purchaser, typewritten) and shall be executed on behalf of the City by the signatures of its
Mayor and City Manager and be sealed with the seal of the City; provided, however, that the seal
of the City may be a printed (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 may be omitted on the Bonds as permitted by law.
In the event of disability or resignation or other absence of either such officer, the Bonds may be
signed by the manual or facsimile signature of that officer who may act on behalf of such absent
or disabled officer. In case either such officer whose signature or facsimile of whose signature
shall appear on the Bonds shall cease to be such officer before the delivery of the Bonds, such
signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if he
or she had remained in office until delivery. The City may elect to deliver, in lieu of printed
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
such Bond, substantially in the form hereinabove set forth, shall have been duly executed by an
authorized representative of the Bond Registrar. Certificates of Authentication on different
Bonds need not be signed by the same person. The Bond Registrar shall authenticate the e
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 of the Holder, Bonds may be exchanged for Bonds of any Authorized
Denomination or Denominations of a like aggregate principal amount and stated maturity, upon e
surrender ofthe Bonds to be exchanged at the principal office of the Bond Registrar. Whenever
1663912vl
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any Bonds are so surrendered for exchange, the City shall execute (if necessary), and the Bond
Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the
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 with respect to interest payment and record date) 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 e
shall be delivered by the Finance Director to the Purchaser upon receipt of the purchase price,
and the Purchaser shall not be obliged to see to the proper application thereof.
15. Fund and Accounts. There is hereby created a special fund to be designated the
"Taxable General Obligation Tax Increment Refunding Bonds, Series 2004C 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 any other general
obligation tax increment refunding bonds hereafter made payable from the Fund and issued for
the Project, including any modifications or additions thereto, and the interest thereon have been
fully paid. There shall be maintained in the Fund separate accounts to be designated the
"Payment Account" and "Debt Service Account", respectively.
(a) Payment Account. Bond proceeds, not including accruing interest and/or unused
discount, in the amount of $1,137,575.95 shall be deposited in the Payment Account, which
amount, together with all other funds available and duly appropriated for such purpose, is
sufficient to prepay the Prior Notes on August 10, 2004. All of the remaining Bond proceeds in
the Payment Account after payment of the Prior Notes shall be used to pay the costs of issuing
the Bonds, and any monies remaining therein after all such costs have been paid or provided for
shall be transferred to the Debt Service Account for the Bonds.
(b) Debt Service Account. There are hereby irrevocably appropriated and pledged to,
and there shall be credited to, the Debt Service Account: (i) Tax Increments pledged to the City
under the Pledge Agreement; (ii) all accrued interest received upon delivery of the Bonds; (iii)
all funds paid for the Bonds in excess of the minimum bid; (iv) all collections of any ad valorem
taxes which may be levied in the event Tax Increments pledged for the payment of the principal
and interest on the Bonds are insufficient for the payment thereof; (v) all funds remaining in the
Payment Account after payment of the costs of issuing the Bonds; (vi) all investment earnings on
funds held in the Debt Service Account; and (vii) any and all other moneys which are properly
available and are appropriated by the governing body of the City to the Debt Service Account.
The Debt Service Account shall be used solely to pay the principal and interest and any
premiums for redemption of the Bonds and any other general obligation bonds of the City
hereafter issued by the City and made payable from said account as provided by law.
16. Tax Increments. The City hereby pledges and appropriates the Tax Increments
remitted by the Authority to the City derived from the Tax Increment District to the Debt Service
Fund, which pledge and appropriation shall continue until all of the Bonds, and any additional
bonds payable from the Fund, are paid or discharged.
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17. Future Tax Levies. In the event that it is anticipated that the aggregate of Tax
Increments and any other funds appropriated to and then held in the Fund and the estimated
collections of Tax Increments to be received in the next succeeding year will not be sufficient to
pay the principal and interest on the Bonds to become due in the first calendar year after such
determination and the first six (6) months of the succeeding calendar year, the City Council shall
pass a resolution requesting the County Auditor to levy an ad valorem tax in an amount as is e
necessary, together with the aforementioned funds then held in the Bond Fund and said estimated
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.
collections of Tax fucrements, to pay the principal and interest on the Bonds to become due
during said period.
18. Reservation of Rights. Notwithstanding any provisions herein to the contrary, the
City reserves the right to terminate, reduce or apply to other lawful purpose the Tax fucrements
herein pledged to the payment of the Bonds and interest thereon to the extent and in the manner
permitted by law.
19. Pledge Agreement. The Mayor and City Manager are hereby authorized to
execute the Tax fucrement Pledge Agreement in substantially the form presented to the City
Council, which Tax fucrement Pledge Agreement pledges Tax fucrements derived from the Tax
fucrement District to the payment of the Bonds.
20. Concurring Resolution of the Authority. The Authority will adopt a resolution
authorizing execution of the Pledge Agreement. The City shall take such action as it determines
is necessary to assure that the covenants of the Authority in the Pledge Agreement are fully and
promptly performed; provided that in the exercise of any rights with respect thereto, the City
shall be subject to the same standards and to the same rights applicable to the Authority under
the covenants as if the City were the Authority.
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21. No Tax Levv: Coverage Test. The Tax fucrements required to be remitted to the
City pursuant to the Pledge Agreement and herein pledged to the payment of the Bonds are such
that if collected in full they will produce at least five percent (5%) in excess of the amount
needed to meet when due the principal and interest payments on the Bonds. Accordingly, no
taxes upon all taxable property in the City are required to be levied for the payment of the Bonds
prior to their issuance as permitted by Minnesota Statutes, Section 469.060.
22. 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 oflaw 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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23. Continuing Disclosure. The City is the sole obligated person with respect to the e
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
"Undertaking") hereinafter described to:
(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 a
enforceable on behalf of such Holders; provided that the right to enforce the provisions of these WI'
covenants shall be limited to a right to obtain specific enforcement of the City's obligations under
the covenants.
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 (iii) acceptable to the Officers.
24. 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.
25. 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 anq Public Records of Hennepin County, Minnesota, together with such other information as
such County Auditor and Director shall require, and to obtain the County Auditor's and the
Director's Certificate that the Bonds have been entered in their respective Bond Register. e
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26. Records and Certificates. The officers of the City are hereby authorized and
directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality of the
issuance of the Bonds, certified copies of all proceedings and records of the City relating to the
Bonds and to the financial condition and affairs of the City, and such other affidavits, certificates
and information as are required to show the facts relating to the legality and marketability of the
Bonds as the same appear from the books and records under their custody and control or as
otherwise known to them, and all such certified copies, certificates and affidavits, including any
heretofore furnished, shall be deemed representations of the City as to the facts recited therein.
27. Taxable Status ofthe Bonds. The City does not qualify the Bonds as tax-exempt
under the futernal Revenue Code of 1986, as amended. It is hereby determined that the Bonds
are to be issued as fully taxable obligations, and all interest received on the Bonds is to be
included in the gross income of the Holder of any Bond for federal income taxation purposes
and, to the same extent, in both gross income and taxable net income for state income taxation
purposes.
28. Payment of Issuance 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 fmancial advisor, EWers.
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.
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.
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STATE OF MINNESOTA
.
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 held on
the date therein indicated, insofar as the minutes relate to authorizing the issuance and awarding
the sale of$I,170,000 Taxable General Obligation Tax Increment Refunding Bonds, Series
2004C.
WITNESS my hand on July 12, 2004.
~~~.
City Manager
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" ""--/--"""""---""---""-"
--.--.-.---.----'-'.----.---...--.-----------------.--..----.-.---.-------------..--------..-...."'---'--'-----.-.-..-.-.
BID TABULATION
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$1,170,000 Taxable General Obligation Tax Increment Refunding Bonds, Series 2004C
CITY OF CHANHASSEN, MINNESOTA
SALE: July 12, 2004
AWARD: CITIGROUP GLOBAL MARKETS, INC.
RATING: Standard & Poor's "M-"
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B81: 4.81%
NET TRUE
MATURITY RATE REOFFERING PRICE INTEREST INTEREST
(February 1) YIELD COST RATE
2006 3.000% 2.700% $1,159,736.20 $651,586.30 5.4972%
2007 3.200% 3.200%
2008 3.650% 3.650%
2009 4.050% 4.050%
2010* 4.600% 4.600%
2011* 4.600% 4.600%
2012** 5.000% 5.050%
2013** 5.000% 5.050%
2014*** 5.200% 5.250%
2015*** 5.200% 5.250%
2016**** 5.400% 5.500%
2017**** 5.400% 5.500%
2018***** 5.700% 5.750%
2019***** 5.700% 5.750%
2020****** 6.000% 6.000%
2021****** 6.000% 6.000%
..,.
2006 2.250% $1,149,525.00 $659,760.44 5.6028%
2007 2.250%
2008 4.000%
2009 4.000%
2010 4.600%
2011 4.600%
2012 5.000%
2013 5.000%
2014 5.400%
2015 5.400%
2016 5.550%
2017 5.550%
2018 5.700%
2019 5.700%
2020 5.800%
2021 5.800%
NAME OF BIDDER
CITIGROUP GLOBAL MARKETS, INC.
Chicago, Illinois
UBS FINANCIAL SERVICES INC.
Chicago, Illinois
CRONIN & CO., INC.
Minneapolis, Minnesota
CITIZENS BANK
Flint, Michigan
NORTHLAND SECURITIES, INC.
Minneapolis, Minnesota
BERNARDI SECURITIES, INC.
Chicago, Illinois
*$120,000 Term Bond due 2011 with mandatory redemption in 2010
**$135,000 Term Bond due 2013 with mandatory redemption in 2012
***$145,000 Term Bond due 2015 with mandatory redemption in 2014
****$165,000 Term Bond due 2017 with mandatory redemption in 2016
*****$185,000 Term Bond due 2019 with mandatory redemption in 2018
******$210,000 Term Bond due 2021 with mandatory redemption in 2020
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EHLERS
& ASSOCIATES INC
LEADERS IN PUBLIC FINANCE
3060 Centre Pointe Drive, Roseville, MN 55113-1105
651.697.8500 fax" 651.697.85.55 www.ehlers-inc.com
Offices in" Roseville, MN, Brookfield, WI and Naperville, IL
--_\._-
$1,170,000 Taxable General Obligation Tax Increment Refunding Bonds, Series 2004C
City of Chanhassen, Minnesota
w
..- .
';'-/6
.
Page 2
NAME OF BIDDER
PRICE
NET TFA
INTEREST INTEl!rST
COST RATE
MATURITY RATE REOFFERING
(February 1) YIELD
2006 5.550%
2007 5.~50%
2008 5.550%
2009 5.550%
2010 5.550%
2011 5.550%
2012 5.550%
2013 5.550%
2014 5.550%
2015 5.550%
2016 5.550%
2017 5.550%
2018 5.550%
2019 5.550%
2020 5.550%
2021 5.550%
NBC CAPITAL MARKETS GROUP, INC.
Memphis, Tennessee
MORGAN KEEGAN & CO., INC.
Memphis, Tennessee
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
....
$1,152,988.20 $672,230.93 5.7512%
4.800%
4.800%
4.800%
4.800%
4.800%
4.800%
4.800%
4.800%
4.800%
5.950%
5.950%
5.950%
5.950%
5.950%
5.950%
5.950%
$1,149,563.10 $687,296.59 5.8487%
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