2000-3RESOLUTION NO. 2000-3
REVENUE BOND RESOLUTION
$930,000 PUBLIC PROJECT REVENUE BONDS, SERIES 2000
(CITY OF CHANHASSEN, MINNESOTA
LEASE WITH OPTION TO PURCHASE PROJECT)
ECONOMIC DEVELOPMENT AUTHORITY
OF THE CITY OF CHANHASSEN, MINNESOTA
ADOPTED: December 4, 2000
1231446.1
TABLE OF CONTENTS
Page
ARTICLE ONE - DEFINITIONS, EXHIBITS, LEGAL AUTHORIZATION AND FINDINGS
1-1.
1-2.
1-3.
1-4.
Definitions ......................................................... 1
Exhibits ........................................................... 5
Legal Authorization .................................................. 5
Findings .................... . ....................................... 5
ARTICLE TWO - BONDS
2-1.
2-2.
2-3.
2-4.
2-5.
2-6.
2-7.
2-8.
Authorized Amount and Form of Bonds .................................. 7
Initial Issue ........................................................ 14
Execution ......................................................... 14
Delivery of Initial Issue .............................................. 14
Issuance of Additional Parity Bonds .................................... 15
Mutilated, Lost or Destroyed Bonds .................................... 16
Ownership of Bonds ....................... '. ........................ 16
Delivery of Temporary Bond .......................... ~. ............... 16
2-9. Registration, Transfer and Exchange of Bonds ............................ 16
2-10. Interest Rights Preserved; Dating of Registered Bonds ..................... 17
2-11. Other Revenue Bonds ............................................... 17
2-12. Book-Entry Only System ............................................ 18
2-13. Termination of Book-Entry Only System ................................ 18
ARTICLE THREE - REDEMPTION OF BONDS BEFORE MATURITY ................ 20
3-1. Redemption ....................................................... 20
3-2. Notice of Redemption ............................................... 20
3-3. Procedure for Redemption ............................................ 20
3-4. Cancellation ....................................................... 21
ARTICLE FOUR - GENERAL COVENANTS
4-1.
4-2.
4-3.
4-4.
4-5.
4-6.
4-7.
4-8.
4-9.
4-10.
Payment of Principal and Interest ...................................... 22
Performance of and Authority for Covenants ............................. 22
Title and Instruments of Further Assurance .............................. 22
Taxes, Assessments and Charges ...................................... 22
Maintenance and Repair ............................................. 23
Recording and Filing ................................................ 23
Books and Records ................................................. 23
Names of Bondholders .............................................. 23
Nature of Security .................................................. 23
Disposition of Pledged Funds ......................................... 24
1231446.1
4-11. Enforcement of Covenants ........................................... 24
4-12. Covenant to Lease, Sell and Operate ................................... 26
4-13. Acceleration ...................................................... 26
4-14. Tax Exempt Status of Bonds; Designation of QTEO ....................... 26
4-15. Conditions to Authority Action ....................................... 27
ARTICLE FIVE - FUNDS AND ACCOUNTS ..................................... 28
5-1. Deposit of Bond Proceeds ............................................ 28
5-2. Bond Fund ........................................................ 28
5-3. Deposit of Funds with Paying Agent .................................... 28
5-5. Priority of Payment and Application of Moneys ........................... 29
ARTICLE SIX - POSSESSION, USE AND RELEASE OF PROPERTY ................. 31
6-1. Possession and Use ................................................. 31
6-2. Easement for Access or Utility Service .................................. 31
6-3. Release of Encumbered Equipment ..................................... 31
6-4. Release of Unimproved Land ......................................... 31
ARTICLE SEVEN - INVESTMENTS ........................................ .... 32
7-1. Investments by Authority ............................................. 32
7~2. Return on Investments ............................................... 32
ARTICLE EIGHT - DISCHARGE OF OBLIGATIONS TO BONDHOLDERS ............ 33
8-1. Conditions of Discharge ............................................. 33
8-2. Payment of Bonds .................................................. 33
8-3. Cancellation of Surrendered Bonds and Coupons .......................... 34
ARTICLE NINE - SUPPLEMENTAL AND AMENDATORY RESOLUTIONS ........... 35
9-1. Supplemental and Amendatory Resolutions Not Requiring Consent of
Bondholders ...................................................... 35
9-2. Supplemental and Amendatory Resolution Requiring Consent of Bondholders .. 35
ARTICLE TEN - AMENDMENT TO LEASE ...................................... 37
10-1. Amendments Without Bondholder Consent ............................. 37
10-2. Amendments Requiring Bondholder Consent ............................ 37
ARTICLE ELEVEN - MISCELLANEOUS ........................................ 38
11-1. Consent of Bondholders ............................................ 38
11-2. Notice of Amendments ............................................. 38
11-3. Severability ...................................................... 38
11-4. Authentication of Transcript ......................................... 39
11-5. Limitation of Liability .............................................. 39
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-6. Registration of Bond Resolution ...................................... 39
-7. Approval of Lessee ................................................ 39
-8. Authorization to Execute Lease, Ground Lease and Incidental Documents ..... 39
-9. Payment of Issuance Expenses ....................................... 39
SIGNATURES ............................................................... 40
EXHIBITS
1231446.1
REVENUE BOND RESOLUTION
BE 1T RESOLVED by the Economic Development Authority of the City of Chanhassen,
Minnesota:
ARTICLE ONE
DEFINITIONS, EXHIBITS, LEGAL AUTHORIZATION AND FINDINGS
1-1. Definitions. The term used herein, unless the context hereof shall require otherwise
shall have the following meanings, and any other terms defined in the Lease shall have the same
meanings when used herein as assigned to them in the Lease unless the context or use thereof
indicates another or different meaning or intent.
Act: collectively the Issuer Powers Act and the Lessee Powers Act as amended from time
to time.
Additional Bonds: any additional Bonds issued pursuant to the terms and conditions of
Section 2-5 hereof.
Authenticating Agent: the Paying Agent.
Authority: the Economic Development Authority of the City of Chanhassen, Minnesota,
and any successor public entity.
Beneficial Owner: means the person for which a DTC Participant holds an interest in the
Bonds as shown on the books and records of the DTC Participant.
Bond Closing: the date on which there is delivery of and payment for the Bonds.
Bond Counsel: Briggs and Morgan, Professional Association, of Saint Paul and
Minneapolis, Minnesota, or any other attorney designated by the Authority duly admitted to
practice law before the highest court of any state and nationally recognized in the field of
municipal finance, and any opinion of Bond Counsel shall be a written opinion of such Counsel.
Bond Fund: the Bond Fund created under Section 5-2 hereof.
Bond Register: the register maintained by the Bond Registrar pursuant to Section 2-9.
Bond Registrar: U.S. Bank Trust National Association, in St. Paul, Minnesota and any
duly appointed successor Bond Registrar.
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Bondholder: any Holder of a Bond.
Bonds: the Public Project Revenue Bonds, Series 2000 (City of Chanhassen, Minnesota
Lease With Option to Purchase Project).
Business Day: any day other than a Saturday, Sunday, legal holiday or a day on which
banking institutions in the City were the principal office of the Paying Agent is located are
authorized by law or executive order to close.
Cede & Co.: means, initially, Cede & Co., as nominee of DTC and any successor or
subsequent such nominee designated by DTC respecting DTC's functions as book-entry
depository for the Bonds.
City: the City of Chanhassen, Minnesota.
Condemnation: requisition or taking by governmental authority or by a person, firm or
corporation acting under governmental authority and a conveyance made under threat of
Condemnation provided such conveyance is made with the approval of the Authority, which
approval shall not be unreasonably withheld, and Condemnation award shall include payment for
property taken or requisitioned or conveyed under threat of Condemnation.
County Recorder: the County Recorder for Carver County.
DTC: means Depository Trust Company, New York, New York, a limited purpose trust
company organized under the laws of the State of New York, or any successor book-entry
securities depository for the Bonds appointed pursuant to Section 2.12.
DTC Participant: means those broker-dealers, banks and other financial institutions from
time to time for which DTC holds Bonds or Securities as depository.
Financial Journal: Northwestern Financial Review or any other newspaper or journal
devoted to financial news circulated in the English language in Minneapolis and St. Paul,
Minnesota.
Ground Lease: the Ground Lease Agreement dated as of December 1, 2000, between the
Lessee as Lessor, and the Authority as Lessee, whereby the Lessee leases the Land to the
Authority.
Holder: the person in whose name any Bond is registered, as shown on the Bond Register
maintained by the Bond Registrar.
Independent: any person who is not a full time employee of the Authority or the Lessee.
1231446.1 2
Independent Accountant: a certified public accountant or firm of certified public
accountants registered, Independent and qualified to practice as such under the laws of
Minnesota, and not regularly employed by the Authority or the Lessee except to perform
independent audits of the books and records of either or both of them or to make other similar
periodic reviews.
Independent Counsel: an attorney or firm of attorneys designated by the Authority,
Independent and duly admitted to practice law before the highest court of any state.
· Independent Engineer: an architect or engineer or architectural or engineering firm
designated by the Authority, Independent, and registered and qualified to practice such profession
under the laws of Minnesota.
Internal Revenue Code: the Internal Revenue Code of 1986, as amended.
Issuer Powers Act: Minnesota Statutes, Section 469.090 through 469.1081, as from time
to time amended.
Land: the parcel or parcels or other interests in real estate leased to the Authority under
the Ground Lease and described in Exhibit A to the Lease.
Lease: the Lease with Option to Purchase Agreement dated December 1, 2000, whereby
the Authority proposes to lease, or sublease as to the Land, the Project to the Lessee, a form of
which Lease is on file in the office of the Authority.
Lease Payments: Rental Payments payable to the Authority under Section 5.1 of the
Lease.
Lessee: the City of Chanhassen, Minnesota, or any successor to its functions.
Lessee Powers Act: Minnesota Statutes, Section 469.041 and 465.71, as from time to
time amended.
Net Proceeds: with respect to any property insurance payment or Condemnation award,
the amount remaining after deduction of all expenses reasonably incurred by the Authority in the
collection thereof, including but not limited to attorneys' fees, witness fees and any extraordinary
expenses of the Authority.
Net Revenues: all sums realized from the operation of all or any part of the Project by the
Authority after deducting all necessary reasonable current costs of operation of the Project
incurred by the Authority determined in accordance with accepted accounting practice, including,
but without limitation, administrative expenses incurred solely with respect to the operation of
1231446.1 3
the Project; current maintenance and repairs necessary to maintain the Project in adequate repair
and operating condition; labor and the cost of material and supplies necessarily used for such
current operation, maintenance and repairs; insurance of the premises against risks and in
amounts for which insurance is usually carried by prudent owners of like properties, including
but not limited to insurance required by the Lease; insurance of the Authority and its officers and
employees against liability for damage to persons and property incurred in connection with such
operation, in amounts such as are usually carried by prudent operators of similar enterprises, or in
lesser amounts to which Authority's liability may be limited by law; and charges for the accumu-
lation of appropriate reserves for the payment of operating costs which recur periodically but in
varying amounts. The operating costs of the Project shall also include the cost of any renewal,
replacement or improvement of or additions to capital assets incurred by the Authority to
facilitate the lease, sale or other disposition of the Project after any termination of the Lease. The
operating costs of the Project shall not, however, include any allowance of payment for
depreciation; any portion of the salary or wages paid to any officer or employee of the Authority,
except such portion as represents reasonable compensation for the performance of duties
necessary exclusively for the operation of such Project, and not for other operations of the
Authority; or any liability incurred by the Authority or any officer or employee for damage to
persons or property, in excess of the amount of such liability compensated by insurance. The Net
Revenues from the operation of the Project constitute all of the revenues from time to time
received from the operation of the Project, including any improvements thereto, in excess of said
operating costs incurred and payable or to become payable within one month and any reasonable
reserve therefor. In addition Net Revenues shall include all sums realized from the sale of all or
any part of the Project after deducting all necessary reasonable costs of the sale incurred by the
Authority.
Official Statement: the Official Statement dated November 22, 2000, and the Addendum
thereto, prepared in connection with the Bonds.
Outstanding: used as any particular time with reference to Bonds, means all Bonds
theretofore executed and delivered by the Authority under this Resolution except: (i) Bonds
theretofore canceled by the Authority or surrendered to the Authority for cancellation; (ii) Bonds
fully paid or otherwisedischarged under Article Eight hereof; and (iii) Bonds in lieu of or in
substitution for which other Bonds shall have been executed and delivered by the Authority
pursuant to the terms of Section 2-6 pertaining to replacement of Bonds.
Paying Agent: U.S. Bank Trust National Association, in St. Paul, Minnesota, or any
other bank designated pursuant to this Resolution as the agent of the Authority to receive and
disburse the principal and interest on the Bondsl
Project Acquisition Fund: the Project Acquisition Fund described in Section 5-1.
Purchaser: Bernardi Securities, Inc., in Chicago, Illinois.
1231446.1 4
Representation Letter: means such letter of representations to DTC or other
documentation required by DTC as a condition to its acting as'book-entry depository for the
Bonds together with any replacement thereof or amendment or supplement thereto (and including
any structured procedures or policies referenced therein or applicable thereto) respecting the
procedures and other matters relating to DTC's role as book-entry depository for the Bonds.
Representative: the Chairperson of the Authority or the Mayor of the Lessee, or any other
person at any time designated to act on behalf of the Authority or the Lessee as the case may be,
as evidenced by a written certificate furnished to the other party containing a specimen signature
of such person and signed for the Authority by its Chairperson or for the Lessee by its Mayor.
Resolution: this resolution of the Authority. All references in this Resolution to
designated "Articles," "Sections" and other subdivisions are to the designated Articles, Sections
and subdivisions of this instrument as originally executed. The words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Resolution as a whole not to any
particular Article, Section or subdivision.
1-2. Exhibits. The following Exhibits are attached to and by reference made a part of
this Resolution:
Exhibit A: legal description of the Land; and
Exhibit B' description of the Project.
1-3. Legal Authorization. The Authority is a body corporate and politic organized and
existing under the Issuer Power Act, and is authorized under said laws to initiate the Project
herein referred to, and to issue and sell bonds for that purpose in the manner and upon the terms
and conditions set forth in the Issuer Power Act, and in this Resolution.
1-4. Findings. The Authority has heretofore determined, and does hereby determine, as
follows:
(1) the Authority is authorized by the Issuer Powers Act to acquire the Land for the
public purposes expressed in the Issues Powers Act, provided for installation and construction of
the Project Equipment and Improvements therefor and to lease, or as for the Land sublease, the
Project upon the terms set forth thereon.
(2) the Authority has made the necessary arrangements with the Lessee, for the
establishment within the City of a Project consisting of property to be used as a municipal
building, all as more fully described in the Lease and which will be of the character and
accomplish the purposes provided by the Issuer Powers Act; and the Authority has by this
Resolution authorized the Project and execution of the Lease, specifying the terms and conditions
1231446.1 5
of the acquisition, installation, improvement and construction of the Project and of the leasing, or
as for the Land subleasing, of the same to the Lessee;
(3) in authorizing the Project the Authority's purpose is, and in its judgment the effect
thereof will be, to promote the public welfare by providing publicly owned facilities required for
governmental services needed for: the attraction, encouragement and development of
economically sound industry so as to prevent, so far as possible, the emergence of blighted and
marginal lands and areas of chronic unemployment; the development of industry to use the
available resources of the community in order to retain the benefit of the community's existing
investment in educational and public service facilities and to halt the movement of talented,
educated personnel of mature age to other areas, thus preserving the economic and human
· resources needed as a base for providing governmental services and facilities; the provision of
accessible employment opportunities for residents in the area; and the expansion of an adequate
tax base of the City to finance the increase in the amount and cost of governmental services,
including educational services for the School District of the City;
(4) the amount estimated to be necessary to finance the Cost of the Project will require
the issuance, sale and delivery of Bonds in the aggregate principal amount of $930,000 as
hereinafter provided;
(5) it is desirable, feasible and consistent with the objects and purposes of the Issuer
Powers Act to issue the Bonds, for the purpose of acquiring, constructing, improving and
installing the Project;
(6) the Bonds and the interest thereon do not constitute an indebtedness of the Authority
or the City within the meaning of any constitutional or statutory limitation and do not constitute
or give rise to a pecuniary liability or a charge against the general credit or taxing powers of the
Authority or the City and neither the faith and credit nor the taxing powers of the Authority or the
City is pledged for the payment of the Bonds or interest thereon; and
(7) the Purchaser has offered to purchase the Bonds in accordance with the terms and
conditions of this Resolution.
1231446.1 6
ARTICLE TWO
BONDS
2-1. Authorized Amount and Form of Bonds. Bonds issued pursuant to this Resolution
shall be in substantially the form set forth herein, with such appropriate variations, omissions and
insertions as are permitted or required by this Resolution, and in accordance with the further
provisions of this Article, and the total principal amount of Bonds that may be outstanding
hereunder is expressly limited to $930,000 unless Additional Bonds are authorized as provided in
2-5 or duplicate Bonds are issued pursuant to Section 2-6. The Bonds shall be in substantially
the following form:
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTIES OF HENNEPIN AND CARVER
ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF CHANHASSEN
Public Project Revenue Bonds, Series 2000
(City of Chanhassen, Minnesota Lease With Option to Purchase Project)
No. R - $
Rate Maturity Date of Original Issue CUSIP
December 1, 2000
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF CHANHASSEN,
a public body corporate and politic and a political subdivision in the Counties of Hennepin and
Carver and State of Minnesota (the "Authority"), for value received, hereby promises to pay, but
only from its 2000 Public Project Revenue Bond Fund (the "Bond Fund"), to Cede & Co. or
registered assigns, the principal amount specified above, on the maturity date specified above
upon the presentation and surrender hereof, and to pay to the registered owner hereof interest on
such principal sum from such Bond Fund at the interest rate specified above from December 1,
2000, or the most recent interest payment date to which interest has been paid or duly provided
for, as specified below, commencing on August 1, 2001 and semiannually thereafter on February
I and August 1 of each year until the principal sum is paid. Principal and interest are payable in
1231446.1 7
lawful money of the United States of America at the office of U.S. Bank Trust National
Association, in St. Paul, Minnesota (the "Bond Registrar"), as Paying Agent and Bond Register
or any successor named pursuant to the terms of the Bond Resolution hereinafter described.
Interest shall be paid on each February 1 and August 1 interest payment date by check or draft
mailed to the person in whose name this Bond is registered at the close of business on the
fifteenth day of the preceding calendar month (whether or not a business day) at the address set
forth on the registration books maintained by the Bond Registrar. Any such interest not
punctually paid or provided for will cease to be payable on such regular record dates and such
defaulted interest may be paid to the person in whose name this Bond shall be registered at the
close of business On a special record date for the payment of such defaulted interest established
by the Authority pursuant to the Bond Resolution.
So long as this Bond is immobilized in global book-entry form registered in the name of
the nominee of DTC (as defined in the Bond Resolution) payments of principal of, premium, if
any, and interest on this Bond shall be made as provided in the Representation Letter, as defined
in the Bond Resolution and surrender of this Bond shall not be required for payment of the
redemption price upon a partial redemption of this Bond or for optional or mandatory purchases
of this Bond or portions thereof. Until termination of the book-entry only system pursuant to the
Bond Resolution, Bonds may be registered only in the name of DTC or its nominee, and
notwithstanding express provisions of this Bond providing other or contrary results, the
Representation Letter (which includes the applicable practices and procedures of DTC) shall
apply to this Bond.
.Optional Redemption. Bonds maturing after February 1, 2008, are subject to redemption
and prepayment, in whole or in part, and if in part, of any maturity designated by the Lessee and
by lot within a maturity, and in integral multiples of principal amount of $5,000, at the option of
the Authority acting at the direction of the Lessee, on February 1, 2008, and on any date
thereafter at a redemption price equal to par plus accrued interest. If (a) all or any part of the
Project is lost, stolen, condemned, destroyed or damaged beyond repair, (b) Lessee fails to notify
the Authority of which course of action Lessee plans to take as required under Section 6.6 of the
Lease and (c) Lessee pays to the Authority a sum equal to the Casualty Value of the Project under
Section 6.6 of the-Lease, on the first day of the month next succeeding such payment before
which month timely notice of redemption can be given under Section 3-2 of the Bond
Resolution, all Bonds shall be called for and are subject to redemption and prepayment in whole
and not in part, at a redemption price equal to par plus accrued interest. If an Event of Default
should occur and subsist under the Lease or if the Lease should be terminated on account of a
Non-appropriation pursuant to Section 4.2 of the Lease, all Bonds then outstanding may, at the
option of the Authority, become or be declared due and payable before the stated maturity
thereof, together with interest accrued thereon, all as provided in the Bond Resolution.
Prior to the date on which any Bond or Bonds are directed by the Authority to be
redeemed in advance of maturity, the Authority will cause notice of the call thereof for
1231446.1 8
redemption identifying the Bonds to be redeemed to be mailed to the Paying Agent and all
Bondholders, at the addresses shown on the Bond Register. All Bonds so called for redemption
will cease to bear interest on the specified redemption date, provided funds for their redemption
have been duly deposited.
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 Authority or Bond Registrar so requires, a written
instrument of transfer in form satisfactory to the Authority and Bond Registrar duly executed by
the Holder thereof or the Holder's attorney duly authorized in writing) and the Authority shall
execute (if necessary) and the Bond Registrar shall authenticate and deliver to the Holder of such
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 such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion of the principal.
of the Bond so surrendered.
This Bond is one of an issue in the aggregate principal amount of $930,000, all of like
date of original issue and tenor, except as to number, interest rate, maturity, denomination and
redemption privilege, issued in accordance with an authorizing resolution (the "Bond
Resolution") duly adopted by the Authority, setting forth the terms upon which such Bonds are
issued and describing the security therefor, to which Bond Resolution reference is made for a full
description of such terms, conditions and security. The Bonds are issued by the Authority for the
purpose of financing a project consisting of the construction and acquisition of land, a building or
buildings, improvements and equipment thereon (the "Project") pursuant to Minnesota Statutes,
Sections 469.090 through 469.1081 including the payment of all expenses incidental thereto, and
the leasing of the Project under the provisions of a Lease With Option to Purchase Agreement
(the "Lease") between the Authority and the City of Chanhassen, Minnesota (the "Lessee"), dated
December 1, 2000.
The Bonds are equally and ratably secured by the Bond Resolution, and reference is made
to the Lease and Bond Resolution and amendments thereof for a description of the revenues
pledged to secure the payment of the Bonds, the nature and extent of the security thereby created,
the rights of the registered owners of the Bonds, the rights, duties, immunities and obligations of
the Authority and the rights, duties and obligations of the Lessee. The obligation of the Lessee
under the Lease to make Rental Payments sufficient to pay the principal of and interest on the
1231446.1 9
Bonds when due is a binding and enforceable obligation of the Lessee, but is subject to a right to
terminate the Lease at the end of any fiscal year during its term, as more fully provided in the
Lease.
The Bonds are issued pursuant to and in full compliance with the Constitution and laws
of the State of Minnesota, and pursuant to the Bond Resolution adopted and approved by the
Authority, which authorized the Project and the issuance of the Bonds as special obligations
payable solely from revenues derived by the Authority from the Project. Rental Payments are to
be paid to the Authority and credited to the Bond Fund as a special trust fund account created by
the Authority and have been and are 'hereby pledged for that purpose. No Additional Bonds
payable from the Bond Fund may be issued on a parity with the Bonds except as provided in the
Bond Resolution. The Bonds do not constitute an indebtedness of the Authority or the Lessee
within the meaning of any constitutional provision or statutory limitation and do not constitute
nor give rise to a pecuniary liability or moral obligation of the Authority or the Lessee or, to the
extent permitted by law, any of their respective officers, employees and agents, nor a charge
against their general credit or taxing powers of the Authority or the Lessee; and neither the full
faith and credit nor the taxing powers of the Authority or the Lessee is pledged for the payment
of the Bonds or interest thereon.
No Holder of any Bond issued under the Bond Resolution shall have the right to institute
any proceedings, judicial or otherwise, for the enforcement of the covenants therein contained
without the written concurrence of the Holders of not less than twenty-five percent (25%) in
aggregate principal amount of such Bonds which are at that time outstanding, but the Holders of
such principal amount of Bonds may, either at law or in equity, by suit, action, mandamus,
application for appointment of a receiver or other proceeding, protect and enforce the rights of all
Holders of such Bonds, and may enforce the performance of all covenants and duties of the
Authority and its officials as set forth in the Bond Resolution, including, but not limited to, the
collection and proper segregation and application of all funds described in the Bond Resolution.
The Holders of fifty-one percent (51%) in principal amount of such outstanding Bonds shall have
the right to direct the time, method and place of conducting any proceeding for any remedy
available to the Bondholders and for the exercise of any power conferred on them, and the right
to waive a default in the performance of any such covenant, and its consequences, except a
default in the payment of the principal of or interest on any Bond when due or required to be
redeemed. However, nothing herein shall impair the absolute and unconditional right of the
Holder of each such Bond to receive payment of the principal thereof and interest thereon at the
times, in the manner and from the sources provided in the Bond Resolution, and to institute suit
for the enforcement of any such payment.
This Bond has been designated by the Authority as a "qualified tax-exempt obligation"
for purposes of Section 265(b) (3) of the Internal Revenue Code of 1986, as amended.
~2sx446.~ 10
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that the Authority has duly
created the Bond Fund and has pledged and appropriated thereto certain rentals from the Project
referred to in the Lease hereinafter defined; that it will promptly give all notices and do all other
acts and things required under the terms of the Lease for the performance of its obligations and
for the enforcement of all obligations of the Lessee and for the collection of all rentals when due;
that this Bond is secured by a pledge of and first lien upon the rentals from the Project as more
fully provided in the Bond Resolution authorizing the Bonds and the Lease, and no additional
revenue bonds or other obligations will be issued and made payable from such rentals and Net
Revenues on a parity herewith except as specifically provided in the Bond Resolution; that all
acts, conditions and things required by the Constitution and laws of the State of Minnesota to be
done, to exist, to happen and to be performed in order to make this Bond a valid and binding
special obligation of the Authority according to its terms have been done, do exist, have
happened and have been performed in regular and due form, time and manner as so required; and
that the issuance of this Bond does not cause the special or general indebtedness of the Authority
to exceed any constitutional or statutory limitation.
IN WITNESS WHEREOF, the Economic Development Authority of the City of
Chanhassen, Minnesota, has caused this Bond to be executed on its behalf by the facsimile
signatures of its Chairperson and Executive Director, authenticated by the manual signature of a
representative of U.S. Bank Trust National Association, as Authenticating Agent, the seal of the
Authority having been intentionally omitted as permitted by law and has caused this Bond to be
dated as of December 1, 2000.
· Facsimile Signature Chairperson
Facsimile Signature Executive Director
Attest:
U.S. BANK TRUST NATIONAL ASSOCIATION
St. Paul, Minnesota
as Authenticating Agent
x23x446.~ 11
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:
TEN COM -
TEN ENT -
JT TEN -
UTMA -
as tenants in common
as tenants by entireties
as joint tenants with right of survivorship and not as tenants in common
as custodian for
(Cust) (Minor)
under the Uniform Transfers to Minors Act
(State)
FORM OF ASSIGNMENT
FOR VALUE RECEIVED, ("Transferor"), the undersigned,
hereby sells, assigns and transfers unto (Social Security or Federal Employer
Identification No. ) the Bond and all rights thereunder, and hereby
irrevocably constitute and appoints ("Transferee") as attorney to
transfer the Bond on the books kept for registration thereof, with full power of substitution in the
premises; provided, however, that if any default with respect to the Bond shall have occurred to
or to the date of this transfer, the Bond shall not be registered and the Transferee shall be entitled
to receive payment with respect to the Bond upon presentation thereof as assignee of the
Transferor.
Date:
Signature Guaranteed:
NOTICE: No transfer will be registered and no new Bond
will be issued in the name of the Transferee, unless the
signature(s) to this assignment correspond(s) with the
name(s) as it (they) appear(s) upon the face of the Bond in
every particular, without alteration or enlargement of any
change whatever and the Social Security or Federal
Employer Identification numbers of the settlor and
beneficiaries of the trust, the date of the trust and the name
of the trustee should be supplied.
NOTICE: Signature(s) must be granted by a
member firm of the New York Stock Exchange
or a commercial bank or a trust company or any other
"Eligible Guarantor Institution" as defined in
17 CFR 240.17 Ad-15(a)(2).
x23x446.x 12
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
x23x446.x 13
2-2. Initial Issue. The Bonds initially issued in the aggregate principal amount of
$930,000, shall be dated December 1, 2000, as the original issue date, shall be in the
denomination of $5,000 each or any integral multiple thereof (as requested by the Purchaser),
numbered consecutively from R-1 upwards and shall mature in order of bond numbers on
February 1 in the years and amounts set forth below, with Bonds maturing in such years and
amounts bearing interest from the original issue date until paid or discharged as herein provided
at the annual rate set forth opposite such years and amounts, respectively:
Year Amount Rate Year Amount Rate
2003 .$70,000 4.75% 2008 $95,000. 5.10%
2004 75,000 4.80 2009 100,000 5.10
2005 80,000 4.85 2010 105,000 5.15
2006 85,000 4.90 2011 I10,000 5.25
2007 90,000 5.00 2012 120,000 5.35
The Bonds shall be subject to redemption and prior payment at the times and prices and in the
amounts and manner provided in Article Three. Interest on each Bond shall be payable on
August 1, 2001, and semiannually thereafter on each February 1 and August 1 until the Bond is
fully paid or discharged. Both principal and interest shall be payable by check or draft mailed to
the Holder of the Bonds by the Bond Registrar at the last address thereof as shown on the Bond
Register on the 15th day of the calendar month next preceding the interest payment date (whether
or not a Business Day) or, if on any interest payment date there are insufficient funds to pay in
full the interest then due on the Bonds, to the Holder as of a special record date established by the
Authority.
2-3. Execution. Each Bond shall be executed on behalf of the Authority by the manual
signature of the Authority's Chairperson and by the printed, engraved or lithographed facsimile
signature of the Authority's Executive Director; provided that each Bond may at the direction of
the Chairperson of the Authority be attested by the manual signature of the Executive Director or
of a person authorized to sign on behalf of the Paying Agent, hereby designated for such purpose
as authenticating agent, in which event the signature of the Chairperson on the Bond may be a
facsimile signature. In the event of the disability or resignation or other absence of either officer,
the Bond may be signed by the manual or facsimile signature, as the case may be, of an officer
who under the bylaws of the Authority may act in behalf of the absent or disabled officer. The
Bonds may be sealed with the seal of the Authority; provided the Authority's seal may be a
printed facsimile and provided further that the seal may be omitted. In case any officer Whose
signature shall appear on the Bonds shall cease to be such officer before 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.
2-4. Delivery of Initial Issue. Before delivery of the Bonds of this issue there shall be
filed with the Executive Director of the Authority the following items:
(1) an original of the Lease of which shall be fully executed;
(2) the opinion of counsel for the Lessee as prescribed by Bond Counsel;
(3) the manually signed opinion of Bond Counsel relating to the legality and tax
exempt status of the Bonds issued pursuant to this Resolution; and
(4) such other documents and opinions as Bond Counsel may reasonably require
for purposes of rendering its opinion required in subsection (3) above; provided, however,
that the Chairperson or Executive Director of the Authority, with the consent of Bond
Counsel, may waive the requirement that one or more of the foregoing items (except the
item required in clause (3) above) be filed on or before Bond Closing upon the Authority
receiving adequate assurances that such item or items will be filed with the Executive
Director as soon as practicable following delivery of the Bonds.
2-5. Issuance of Additional Parity Bonds. After the delivery of Bonds, the Authority and
the Lessee may from time to time, upon the conditions stated in this section, agree upon and
approve the issuance and delivery of Additional Bonds to complete or improve the Project,
including the refunding of any Bonds, payable equally and ratably from the revenues of the
Project pledged and appropriated hereunder with the Bonds of the initial issue, but bearing such
date or dates and interest rate or rates and with such maturities and redemption dates and
premiums as may be agreed upon. Every series of such Additional Bonds shall be authorized by
an amendment to the Lease and a supplemental bond resolution, establishing the terms thereof,
providing for any additional facilities to be financed by the Additional Bonds as part of the
Project, and providing for additional rents sufficient to pay the interest when due for such
Additional Bonds, and to pay and redeem all such Additional Bonds at or before maturity as
provided in such supplemental resolution. Each series of such Additional Bonds shall be
executed, authenticated and delivered as provided in this Article Two upon filing with the
Authority original executed counterparts of the supplemental resolution and the amendment to
the Lease, together with such additional certificates, opinions and other documents described in
Section 2-4 as Bond Counsel determines to be applicable. No such Additional Bonds, however,
shall be issued unless the following conditions are met:
(1) The Lease shall be in effect, and no "event of default", as such term is defined
in the Lease, shall exist thereunder; and
(2) The Authority shall have been furnished an opinion of Bond Counsel to the
effect that the issuance of the Additional Bonds will not impair the tax exempt status of
the interest on the Bonds; and
(3) There shall have been furnished to the Authority a supplement to the Lease
providing for additional payments of Lease Payments sufficient to pay the principal of
and interest on the Additional Bonds when due; and
~23~446.x 15
(4) There shall have been furnished to the Authority a certificate of a Lessee
Representative to the effect that the proceeds of the Additional Bonds, together with any
additional funds supplied or to be supplied by the Lessee will be sufficient to complete
the Project, the cost of the improvement or the cost of the refunding, as the case may be.
2-6. Mutilated, Lost or Destroyed Bonds. In case any Bond issued hereunder shall
become mutilated or be destroyed or lost, the Authority shall, if not then prohibited by law, cause
to be'executed and delivered, a new Bond of like amount, number, maturity date and tenor in
exchange and substitution for and upon cancellation of such mutilated Bond if any, or in lieu of
and in substitution for such Bond, if any, destroyed or lost upon the Holder's or owners paying
the reasonable expenses and charges of the Authority in connection therewith, and in case of a
Bond destroyed or lost, the filing with the Authority of evidence satisfactory to the Authority that
the Bond, if any, were destroyed or lost, and of the ownership thereof, and furnishing the
Authority with indemnity satisfactory .to it. If the mutilated, destroyed or lost Bond has already
matured or been called for redemption in accordance with its terms it shall not be necessary to
issue a new Bond prior to payment.
2-7. Ownership of Bonds. The Authority and Paying Agent may deem and treat the
Holder of any Bond whether or not the Bond shall be overdue, as the absolute owner of the Bond
for the purpose of receiving payment thereof and for all other purposes whatsoever, and the
Authority shall not be affected by any notice to the contrary.
2-8. Delivery_ of Temporary_ Bond. In order to facilitate timely delivery of the Bonds, the
Purchaser may elect with respect to the Bonds to receive in lieu of the definitive Bonds, as set
forth in Section 2-2, a single Bond payable to the Purchaser with installments of principal and
interest due as provided for the Bonds; and such single Bond shall upon request of the Purchase
and the printing of the appropriate definitive Bonds be exchanged therefor and canceled.
2-9. Registration, Transfer and Exchange of Bonds.
(1) The Authority will cause to be kept at the principal corporate trust office of the Bond
Registrar a Bond Register in which, subject to such reasonable regulations as the Bond Registrar
may prescribe, the Authority shall provide for the registration of transfers of Bonds entitled to be
registered or transferred as herein provided.
(2) Upon surrender for transfer of any Bond at the principal corporate trust office of the
Bond Registrar, the Authority shall execute, and the Authenticating Agent shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more new Bonds of any
denomination or denominations of $5,000 or any integral multiple thereof of a like aggregate
principal amount, having the same stated maturity and interest rate, as requested by the
transferor.
1231446.1 16
(3) All Bonds surrendered upon any transfer provided for in this Bond Resolution shall
be promptly canceled by the Bond Registrar and thereafter disposed of a directed by the
Authority.
(4) All Bonds delivered in exchange for or upon transfer shall be valid special
obligations of the Authority evidencing the same debt, and entitled to the same benefits under
this Bond Resolution, as the Bonds surrendered for such exchange or transfer.
(5) Every Bond presented or surrendered for transfer shall (if so required by the
Authority) be duly endorsed or be accompanied by a written instrument of transfer, in form
satisfactory to the Authority and the Bond Registrar, duly executed by the Holder thereof or the
Holder's attorney duly authorized in writing.
(6) No service charge shall be made to the Holder for any transfer, but the Authority may
require payment of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Bonds, other than exchanges expressly
provided in this Bond Resolution to be made without expense or without charge to Bondholder,
and the cost of printing any new Bonds.
(7) The Authority and the Bond Registrar shall not be required (i) to transfer or exchange
any Bond for a period of 15 days next preceding any interest payment date, or (ii) to transfer or
exchange any Bond called or being called for redemption in whole or in part.
2-10. Interest Rights Preserved; Dating of Registered Bonds. Each Bond delivered upon
- transfer of any other Bond shall carry all the fights to interest accrued and unpaid, and to accrue,
which were carried by such other Bond, and each such Bond shall be so dated, that neither gain
nor loss in interest shall result from such transfer.
Each Bond shall be dated by the Bond Registrar as of the last interest payment date
preceding the date of authentication to which the Bond has been paid or made available for
payment, unless the date of authentication is an interest payment date to which interest has been
paid or made available for payment, in Which case the Bond shall be dated as of the date of
authentication.
2-11. Other Revenue Bonds. Nothing contained herein shall however prevent the
issuance by the Authority at the request of the Lesse,e of other bonds without consent of the
Bondholders for any of the purposes authorized under the Act, including any improvement to the
Project, payable from revenues furnished by the Lessee but not pledged and appropriated to the
Bond Fund whether or not the obligation of the Lessee to make such payments is secured by
tangible property or other collateral (except for the Project and revenues derived by the Authority
therefrom under the Bond Resolution), so long as such other bonds are in no way secured by any
of the provisions of the Bond Resolution and an effect thereof would not be to subject the interest
payable on the Bonds and any Additional Bonds to federal or state income taxes.
~23z44~.~ 17
2-12. Book-Ent~ Only System. DTC will act as securities depository for the Bonds. The
Bonds shall be issued in the form of a separate single fully registered bond for each separate
maturity of the Bonds. Upon initial issuance the ownership of the Bonds shall be registered in
the Bond Register in the name of Cede & Co., as the nominee of DTC.
With respect to Bonds registered in the Bond Register in the name of Cede & Co., as
nominee of DTC, neither the Authority, the Lessee nor the Bond Registrar shall have any
responsibility or obligation to any DTC Participant or to any Beneficial Owner. Without limiting
the immediately preceding sentence, neither the Authority, nor the Bond Registrar shall have any
responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co., or
any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any
DTC Participant, any Beneficial Owner or any other person, other than DTC, of any notice with
respect to the Bonds, including any notice of redemption, (iii) the payment to any DTC
Participant, any Beneficial Owner or any other person, other than DTC, of any amount with
respect to the principal of or premium, if any, or interest on the Bonds, or (iv) the failure of DTC
to provide any information or notification on behalf of any DTC Participant or Beneficial Owner.
The Authority and the Bond Registrar may treat as and deem DTC to be the absolute
owner of each Bond for the purpose of payment of the principal of and premium and interest on
the Bond, for the purpose of giving notices of redemption and other matters with respect to the
Bond, for the purpose of registering transfers with respect to the Bonds, and for all other
purposes whatsoever (except for the giving of certain Bondholder consents). The Bond Registrar
shall pay all principal of and premium, if any, and interest on the Bonds only to or upon the order
of the Bondholders as shown on the Bond Register, and all such payments shall be valid and
effective to fully satisfy and discharge the Authority'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.
Upon delivery by DTC to the Bond Registrar of written notice to the effect that DTC has
determined to substitute a new nominee in place of Cede & Co., and subject to the transfer
provisions in Section 2-9 hereof, references to "Cede & Co." in this Section shall refer to such
new nominee of DTC.
Notwithstanding the provisions of this Resolution to the contrary (including without
limitation surrender of Bonds, registration thereof, and Authorized Denominations), as long as
the Bonds are in book-entry form, full effect shall be given to the Representation Letter and the
procedures and practices of DTC thereunder.
2-13. Termination of Book-Entry Only System. DTC may determine to discontinue
providing its services with respect to the Bonds at any time by giving written notice to the
Authority and discharging its responsibilities with respect thereto under applicable law. The
Authority may terminate the services of DTC with respect to the Bonds if it determines that DTC
is no longer able to carry out its functions as security depository as contemplated herein.
~23~446.x 18
Upon the termination of the services of DTC as provided in the preceding paragraph, the
Authority shall take all reasonable and diligent steps as may be necessary to find an alternate
book-entry depository, but if (and only if) no such substitute securities depository willing to
undertake the functions of DTC hereunder can be found which, in the opinion of the Authority, is
willing and able to undertake such functions upon reasonable or customary terms, then the Bonds
shall no longer be restricted to being registered in the Bond Register in the name of Cede & Co.,
as nominee of DTC, but may be registered in whatever name or names the Bondholders shall
designate at that time, in accordance with Section 2-9. To the extent that the Beneficial Owners
are designated as the transferee by the Bondholders, in accordance with Section 2-9 the Bonds
will be delivered in appropriate form, content and Authorized Denomination to the Beneficial
Owners.
Notwithstanding any other provision of this Resolution to the contrary, so long as any
Bond is registered in the name of Cede & Co., as nominee of DTC, 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, to DTC as provided in the Representation
Letter.
~23~446.z 19
ARTICLE THREE
REDEMPTION OF BONDS BEFORE MATURITY
3-1. Redemption.
(1) Optional Redemption of Bonds. Bonds maturing after February 1, 2008 are subject
to redemption and prepayment, in whole or in part, and if in part, of any maturity designated by
the Lessee and by lot within a maturity, and in integral multiples of principal amount of $5,000,
at the option of the Authority acting at the direction of the Lessor, on February 1, 2008 and on
any date thereafter at a redemption price equal to par plus accrued interest.
(2) Extraordinary_ Redemption of Bonds. If (a) all or any part of the Project is lost,
stolen, condemned, destroyed or damaged beyond repair, (b) Lessee fails to notify the Authority
of which course of action Lessee plans to take as required under Section 6-6 of the Lease and (c)
Lessee pays to the Authority a sum equal to the Casualty Value of the Project under Section 6.6
of the Lease, on the first day of the month next succeeding such payment before which month
timely notice of redemption can be given under Section 3-2 hereof, all Bonds shall be called for
and are subject to redemption and prepayment in a whole and not in part, at a redemption price
equal to par plus accrued interest thereon to the redemption date.
(3) Except as provided in this section or in Section 4-13, the Bonds shall not be subject
to redemption prior to their stated maturity date.
3-2. Notice of Redemption. Notice of the call for any redemption pursuant to Section 3-1
shall be mailed by the Authority but at the expense of the Lessee, at least 30 days but not more
than 60 days prior to the redemption date, to the Paying Agent and to the Bondholders, at the
addresses shown on the Bond Register. Each such notice shall refer to the Bonds to be redeemed
by their numbers and maturities and the date on which and the place where they shall be
presented for redemption. On or before the date fixed for redemption, funds sufficient to redeem
such Bonds, including accrued interest thereon to the redemption date, shall be deposited with
the Paying Agent. The Bonds thus called shall not, on or after the specified redemption date,
bear interest.
3-3. Procedure 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 redeemed shall be the Bonds to which were assigned numbers so
selected; provided, however, that only so much of the principal amount of each the 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 Authority or Bond Registrar so requires, a written instrument or
transfer in form satisfactory to the Authority and Bond Registrar duly executed by the Holder
thereof or the Holder's attorney duly authorized in writing) and the Authority shall execute (if
necessary) and the Bond Registrar shall 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.
3-4. Cancellation. All Bonds which have been redeemed shall be canceled by the
Authority and shall not be reissued.
123 l~lZ16.1 21
ARTICLE FOUR
GENERAL COVENANTS
4-1. Payment of Principal and Interest. The Authority covenants that it will promptly pay
or cause to be paid the principal of and interest on every Bond issued under this Resolution at the
place, on the dates and in the manner provided herein and in the Bonds, according to the terms .
thereof. The principal and interest are payable solely from revenues derived from the Project
(including certain Bond proceeds and other sums appropriated to the Bond Fund), which
revenues are hereby specifically assigned and pledged as a first and prior lien to the payment
thereof for the benefit of the Holders of all Bonds and interest and any premium thereon .in the
manner and to the extent herein specified, and nothing in the Bonds or in this Resolution shall be
considered as assigning or pledging any other funds or assets of the Authority. All sums held in
the Bond Fund pursuant to this Resolution shall to the extent permitted by law be deemed
property of the Holders of all Bonds, held in trust for them and subject to the terms and
conditions of this Resolution, including the pledge thereof to the payment of the Bonds and
interest and any premium thereon.
4-2. Performance of and Authori _ty for Covenants. The Authority covenants that it will
faithfully perform at all times any and all covenants, undertakings, stipulations and provisions
contained in this Resolution, in any and every Bond executed, authenticated and delivered
hereunder and in all proceedings of its governing body pertaining thereto; that it is duly
authorized under the Constitution and laws of the State of Minnesota including particularly and
without limitation the Act, to issue the Bonds authorized hereby and to assign and pledge the
revenues in the manner and to the extent herein set forth; that all action on its part for the
issuance of the Bonds and for the execution and delivery thereof has been duly and effectively
taken; and that the Bonds in the hands of the Holders thereof are and will be valid and
enforceable special obligations of the Authority according to the terms thereof.
4-3. Title and Instruments of Further Assurance. The Authority covenants that it has not
made, done, executed or suffered, and will not make, do, execute or suffer, any act or thing
whereby its leasehold estate or interest in and title to the Project or any part thereof is now or at
any time hereafter shall or may be impaired or charged or encumbered in any manner whatsoever
except by Permitted Encumbrances.
4-4. Taxes, Assessments and Charges. The Authority covenants that it will promptly
pay, or cause to be paid, but solely from revenues derived from the Project including payments
required to be made under the Lease, all lawful taxes, assessments, imposts and governmental
charges at any time levied or assessed upon or against the Project, or any part thereof; provided,
however, that nothing contained in this Section shall require the payment of any such taxes,
assessments, imposts or charges so long as the validity thereof is being contested in good faith
and by appropriate legal proceedings.
4-5. Maintenance and Repair. The Authority covenants that it will at all times, but solely
from revenues derived from the Project including payments required to be made under the Lease,
maintain, preserve and keep in good condition, repair and working order the Project or cause the
same to occur.
4-6. Recording and Filing. The Authority covenants that, at the expense of the Lessee, it
will cause the Lease or a short form thereof and all supplements thereto, and all related financing
statements, to be kept, recorded and filed in such manner and in such places as may be required
by law in order to preserve and protect fully the security of the Holders and owners of the Bonds
and the fights of Authority hereunder, and will cause rerecording and refiling of the Lease, each
financing statement and each supplement thereto as is necessary to maintain, preserve and protect
the validity of the Lease and the security of the Holders of the Bonds.
4-7. Books and Records. The Authority covenants that, at the expense of the Lessee, so
long as any Bonds issued hereunder shall be Outstanding and unpaid the Authority will keep, or
cause to be kept, proper books of record and account, in which full, true and correct entries will
be made of all its financial dealings or transactions of and in relation to the Project and the
revenues derived by the Authority therefrom. Such books and records shall be open to inspection
and copying at all reasonable times by the Holder of any Bond or the Holder's agent or attorney.
The Authority will cause said books and records to be audited annually by an Independent
Accountant, within 150 days after the close of each fiscal year, and will upon request furnish a
copy of such audit without cost to the original purchasers of any issue of Bonds or Additional
Bonds.
4-8. Names of Bondholders. At reasonable times and under reasonable regulations
established by the Authority, the Bond Register may be inspected and copied by Holders (or a
designated representative thereof) of ten percent (10%) or more in principal amount of Bonds
then Outstanding hereunder, such authority of any designated representative to be evidenced to
the satisfaction of the Authority.
4-9. Nature of Security. Under the provisions of the Act the Bonds may not be payable
from or be a charge upon any funds of the Authority other than the revenues pledged to the
payment thereof, nor shall the Authority be subject to any liability thereon, nor shall the Bonds
otherwise contribute or give rise to a pecuniary liability of the Authority or the Lessee or, to the
extent permitted by law, any of their respective officers, employees and agents. No Holder or
Holders of the Bonds shall ever have the right to compel any exercise of the taxing power of the
Authority or the Lessee to pay any Bonds or the interest thereon, or to enforce payment thereof
against any property of the Authority other than the revenues derived from the Project. The
Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of
the Authority or the Lessee other than the revenues derived from the Project, and no Bond shall
constitute a debt of the Authority or the Lessee within the meaning of any constitutional or
statutory limitation; but nothing in the Act impairs the rights of Holders of Bonds issued under
this Resolution to enforce the covenants made for the security thereof as provided in this
Resolution and in the Act, and by Authority of the Act the Authority has made the covenants and
agreements herein for the equal and proportionate benefit of all Holders of the Bonds in the
manner and to the extent permitted in Section 5-5. -
4-10. Disposition of Pledged Funds. The Authority covenants that it will cause Lease
Payments and all other revenues pledged to the payment of the Bonds to be accounted for and
expended only as prescribed in this Resolution, and will at all times maintain complete and
accurate books of record and account showing all receipts and expenditures thereof and the
segregation of such rentals and other sums in the funds herein provided, and will at no time loan,
invest, use or apply such funds in any manner or for any purpose other than as specifically
prescribed and permitted in this Resolution.
4-11. Enforcement of Covenants. Subject to the provisions in Section 4-15:
(1) The Authority agrees to enforce all covenants and obligations of the Lessee under the
Lease and to that end exercise all of the Authority's rights in connection therewith, to the extent
and in the manner that the Authority reasonably determines is prudent and necessary to assure
performance of such covenants and obligations and to protect the interests of the Bondholders;
provided however that the Authority shall have the right, with or without Bondholders consent at
its sole discretion, to waive a default in the performance of any such covenant or obligation, and
its consequences, to the extent and in the manner provided in Section 4-11(3).
(2) No Holder of any Bond issued under this Resolution shall have the right to institute
any proceeding, judicial or otherwise, for the enforcement of the covenants herein contained,
without the written concurrence of the Holders of not less than twenty-five percent (25%) in
aggregate principal amount of Outstanding Bonds but the Holders of this principal amount of
Bonds may, either at law or in equity, by suit, action, mandamus, application for appointment of
a receiver or other proceeding, protect and enforce the rights of all Holders of the Bonds, and
may enforce the performance of all covenants and duties of the Authority and its officials as set
forth in this Resolution, including but not limited to the collection and proper segregation and
application of all funds herein described. The Holders of not less than fifty-one percent (51%) in
aggregate principal amount of Outstanding Bonds shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Bondholders and for the
exercise of any power conferred on them, and the right to waive a default in the performance of
any such covenant, and its consequences, except a default in the payment of the principal of or
interest on any Bond when due or required to be redeemed. However, nothing herein shall
impair the absolute and unconditional right of the Holder of each the Bond to receive payment of
the principal thereof and interest thereon at the times provided in this Resolution, and to institute
suit for the enforcement of any such payment except to the extent that the Authority shall have
the right to accelerate payment of the Bonds as provided in Section 4-13 hereof.
(3) The Authority may in its discretion waive any Event of Default under the Lease and
its consequences and rescind any declaration of maturity of principal under Section 4-13, and
~23x446.~ 24
shall do so upon written request of the Holders of (1) fifty-one percent (51%) in aggregate
principal amount of all the Bonds Outstanding in respect of which default in the payment of
principal and/or interest exists, or (2) fifty-one percent (51%) in aggregate principal amount of all
the Bonds then Outstanding in the case of any other Event of Default; provided, however, that
there shall not be waived any Event of Default in the payment of Lease Payments, unless prior to
such waiver or rescission (a) all arrears of Lease Payments with interest equal to at least the
amount by which such Lease Payments is less than total amount of unpaid debt service due on
the Bonds and (b) all expenses of the Authority and Paying Agent, in connection with such
default shall have been paid or provided for and in case of any such waiver or rescission or in
case any proceeding taken by the Authority on account of any such default shall have been
discontinued or abandoned or determined adversely then and in every such case the Authority
and the Bondholders shall be restored to their former positions and rights hereunder respectively,
but no such waiver or rescission shall extend to any subsequent or other Event of Default, or
impair any right consequent thereon.
(4) If an Event of Default should occur under the Lease, all moneys received by the
Authority pursuant to any right given or action taken under the provisions of this Section 4-11 or
the Lease shall, after payment of the cost and expenses of the proceedings resulting in the
collection of such moneys and of the expenses, liabilities and advances incurred or made by the
Authority in connection therewith and any other sums due the Authority under the Lease (other
than any interest due on delinquent Lease Payments), be deposited in the Bond Fund or the
Project Acquisition Fund, as appropriate.
(5) The Authority and any Paying Agent shall be entitled to payment and/or
reimbursement for all advances, counsel fees and other expenses reasonably and necessarily
made or incurred in and about the execution of the trusts created by this Resolution and in and
about the exercise and performance of the powers and duties of the Authority hereunder and for
the reasonable and necessary costs and expenses incurred in defending any liability in the
premises of any character whatsoever (unless such liability is adjudicated to have resulted from
the negligence or willful default of the Authority). The Paying Agent shall also be entitled to a
reasonable fee for services hereunder. In this regard the Authority has made provisions in the
Lease for the payment of said fees, advances, counsel fees, costs and expenses and reference is
hereby made to said Lease for the provisions so made. Upon an Event of Default under the
Lease, but only upon such an Event of Default and failure of Lessee to make timely payments
under the Lease, the Authority shall have a lien with right of payment prior to the lien herein
created for the benefit of the Bondholders on all revenues derived from the Project by the
Authority including Lease Payments for said fees, advances, counsel fees, costs and expenses
incurred by it.
(6) The Authority shall give to the Holders of the Bonds of any Event of Default under
the Lease known to the Authority or termination of the Lease under Section 4.1 of the Lease,
within ninety (90) days after such event unless such default shall have been cured before the
giving of such notice; provided that such notice shall be given within ten (10) days if the event is
xe3z44~.z 25
either (i) a failure to pay when due any Lease Payments and to cure the same before giving such
notice or (ii) termination of the Lease under Section 4.1 thereof; and provided further that, except
in the case of default in the payment of Lease Payments or termination of the Lease under
Section 4.1 thereof, the Authority shall be protected in withholding such notice if and so long as
the governing body of the Authority or its chief executive officer in good faith determines that
the withholding of such notice is in the interest of the Bondholders.
4-12. Covenant to Lease, Sell and Operate. Subject to the provisions of Section 4-14, the
Authority agrees that if on Event of Default occurs under the Lease or Lessee terminates the
Lease under Section 4-1 thereof, the Authority will use its best efforts while any Bonds remain
Outstanding to lease or operate the Project to provide Net Revenues sufficient to pay the
principal, interest and call premium, if any, on the Bonds and in the event of sale, to obtain the
best price obtainable so that to the extent the Authority determines it reasonably possible all of
the Bonds and the interest thereon are paid in full. This covenant, to the extent that it may
obligate the Authority to re-lease or sell the Project for the benefit of the Bondholders, may be
enforced against the Authority only to the extent that at such time the Authority is permitted by
law to sell the property or to the extent that any consent required for re-leasing the property has
been given.
4-13. Acceleration. Subject to the provisions in Section 4~ 14, upon the occurrence of an
Event of Default under the Lease or termination of the Lease on account of a Non-appropriation
under Section 4-1 of the Lease, the Authority may, and upon the written request of the Holders of
not less than fifty-one (51%) percent in aggregate principal amount of Outstanding Bonds shall,
by notice in writing delivered to the Lessee, declare the principal of all Bonds then Outstanding
and the interest accrued thereon immediately due and payable, and such principal and interest
shall thereupon become and be immediately due and payable. The Authority shall promptly give
mailed notice of acceleration to the Bondholders.
4-14. Tax Exempt Status of Bonds; Designation of QTEO. The Authority shall not
knowingly take, nor fact to take, any action the effect of which would be to impair the tax exempt
status of the Bonds.
In order to qualify the Bonds as "qualified tax-exempt obligations" within the meaning of
Section 265(b)(3) of the Code, the Authority hereby makes the following factual statements and
representations:
(1) the Bonds are issued after August 7, 1986;
(2) the Bonds are not "private activity bonds" as defined in Section 141 of the Code,
treating "qualified 501(c)(3) bonds as not being private activity bonds;
(3) the Authority hereby designates the Bonds as "qualified tax-exempt obligations" for
purposes of Section 265(b)(3) of the Code;
~23~446.~ 26
(4) the reasonably anticipated amount of tax-exempt obligations (other than private
activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will
be issued by the Authority (and all entities treated as one issuer with the Authority, and all
subordinate entities whose obligations are treated as issued by the Authority) during this calendar
year 2000 will not exceed $10,000,000;
(5) not more than $10,000,000 of obligations issued by the Authority during this calendar
year 2000 have been designated for purposes of Section 265(b)(3) of the Code.
The Authority shall use its best efforts to comply with any federal procedural
requirements which may apply in order to effectuate the designation made by this section.
4-15. Conditions to Authority Action. Before taking any specific action under Sections
4-11, 4-12, 4-13, or 4-14 or the last paragraph in Section 5-5, the Authority may at its sole
discretion:
(1) Require that it be furnished an indemnity bond satisfactory to it for the
reimbursement of all expenses to which it may be put and to protect it against all liability, except
liability which is adjudicated to have resulted from the negligence or willful default of the
Authority;
(2) Act upon the opinion or advice of any Independent Counsel, Independent Engineer or
Independent Accountant selected by the Authority in the exercise of reasonable care, or upon the
direction of the Holders of a fifty-one percent (51%) in aggregate principal amount of
Outstanding Bonds; and the Authority shall not be responsible for any loss or damage resulting
from any action or nonaction taken in good faith in reliance upon such opinion or advice or
Bondholder direction; and
(3) Require the consent to the action of the Holders of not less than fifty-one percent
(51%) in principal amount of Outstanding Bonds.
~23~446.~ 27
ARTICLE FIVE
FUNDS AND ACCOUNTS
5-1. Deposit of Bond Proceeds. The Authority shall deposit, or shall direct the Purchaser
to deposit, with the Lessee all of the net proceeds of the sale of the Bonds (including accrued
interest thereon paid by the purchaser; less capitalized interest; and any unused discount) for
deposit in the Project Acquisition Fund as provided in Section 3.1 of the Lease.
5-2. Bond Fund. The Authority hereby establishes and shall maintain, so long as any of
the Bonds are Outstanding, a separate trust account for the benefit of the Bondholders to be
designated "2000 Public Project Revenue Bonds Bond Fund" (herein called the "Bond Fund")
into which the following deposits shall be made:
(1) All payments by the Lessee as Lease Payments under the Lease or any
Purchase Option Price (unless held in escrow to discharge Bonds under Article Eight
hereof).
(2) All other moneys received by the Authority from the Lessee when
accompanied by directions of the Lessee that such moneys are to be paid into the Bond
Fund or used for purposes for which moneys in the Bond Fund may be used. If the
Lessee so directs, such monies shall be credited against Lease Payments due or to become
due.
(3) If the Lease is terminated, all Net Revenues derived from the Project.
(4) All other moneys required to be deposited in the Bond Fund pursuant to any
provision of this Resolution or the Lease.
The moneys and investments in the Bond Fund are irrevocably pledged to and shall be
used by the Authority, from time to time, to the extent required, for the payment of principal of,
and interest and any premium on the Bonds as more fully provided in Section 5-5 hereof; and
shall be used for no other purpose, provided that the Authority may use sums in the Bond Fund to
be used to pay principal on Bonds of a particular maturity (and interest thereon) to instead
purchase the Bonds at a price not to exceed par and accrued interest.
5-3. Deposit of Funds with Paying Agent. The Authority shall transfer and remit sums
from the Bond Fund to the Paying Agent in advance of each interest and principal due date and
redemption date, from the balance then on hand in the Bond Fund, sufficient to pay all principal,
interest and redemption premiums then due on Bonds. The Paying Agent shall hold in trust for
the Holders of such Bonds representing such interest all sums so transferred to it until paid to
such Holders or otherwise disposed of as herein provided. Any money deposited with the
Paying Agent in trust for the Holder of any Bond and remaining unclaimed for six years after the
1231446.1 28
principal, premium, if any, or interest owing to the Holder becomes due and payable, shall be
paid to the Lessee upon request and shall be discharged from the trust, and the Holder of the
Bond shall thereafter, as an unsecured general creditor look only to the Lessee for the payment
thereof, and all liability of the Paying Agent, or the Authority with respect to such trust money
shall cease.
5-5. Priority of Payment and Application of Moneys. All Bonds issued hereunder and
secured hereby shall be equally and ratably secured by and payable from the Bond Fund, without
priority of one Bond over any other, except as otherwise expressly provided herein. Accordingly,
all moneys credited to the Bond Fund, shall be applied as follows:
(1) Unless the principal of all the Bonds shall have become or shall have been declared
due and payable, all such moneys shall be applied:
FIRST: To the payment to the persons entitled thereto of all installments of interest then
due on the Bonds, in the order of the maturity of the installments of such interest, and, if the
amount available shall not be sufficient to pay in full any particular installment, then to the
payment ratably, according to the amounts due on such installment, to the persons entitled
thereto, without any discrimination or privilege;
SECOND: To the payment to the persons entitled thereto of the unpaid principal of any
of the Bonds which shall have become due (other than Bonds called for redemption for the
payment of which moneys are held pursuant to the provisions of this Bond Resolution), in the
order of their due dates, and, if the amount available shall not be sufficient to pay in full Bonds
· due on any particular date, then to the payment ratably, according to the amount of principal due
on such date, to the persons entitled thereto without any discrimination or privilege; and
THIRD: To the payment of interest and premium, if any, on and the principal of the
Bonds, and to the redemption of Bonds, as thereafter may from time to time become due, all in
accordance with the provisions of Article Five hereof.
(2) If the principal of all Bonds shall have become due or shall have been declared due
and payable, all such moneys shall be applied to the payment of the principal and interest then
due and unpaid upon the Bonds, without preference or priority of principal over interest or of
interest over principal, or of any installment of interest .over any other installment of interest, or
of any Bond over any other Bond, ratably, according to the amounts due respectively for
principal and interest, to the persons entitled thereto without any discrimination or privilege.
(3) If the principal of all the Bonds shall have been declared due and payable, and if such
declaration shall thereafter have been rescinded and annulled under the provisions of this
Resolution, then, subject to the provisions of subparagraph (2) of this Section, in the event that
the principal of all the Bonds shall later become due or be declared due and payable, the moneys
shall be applied in accordance with the provisions of paragraph (1) of this Section.
s23s446.s 29
Subject to the provisions in Section 4-15, whenever moneys are to be applied by the
Authority pursuant to the provisions of this Section and there are insufficient sums in the Bond
Fund to pay principal and/or interest then due on the Bonds, the Authority shall apply such
moneys at such times, and from time to time, as the Authority shall determine, having due regard
to the amount of such moneys available for application and the likelihood of additional moneys
becoming available for such application in the future. Whenever the Authority shall apply such
funds, it shall fix the date (which shall be an interest payment date unless it shall deem another
date more suitable) upon which such application is to be made and upon such date interest on the
amounts of principal to be paid on such dates shall cease to accrue. The Authority shall give
such notice as it may deem appropriate of the deposit with the Paying Agent of any such moneys
and of the fixing of any such date, and shall not be required to make payment to the Holder of
any Bond until such Bond shall be presented to the Paying Agent for appropriate endorsement or
for cancellation if fully paid.
ARTICLE SIX
POSSESSION, USE AND RELEASE OF PROPERTY
6-1. Possession and Use. Subject to the terms hereof and to the pledge of rentals and
profits under the Lease, until the happening of an Event of Default under the Lease or
termination of the Lease under Section 4.2 thereof, the Lessee shall be permitted to possess, use
and enjoy the Project (except cash or other personal property deposited or pledged or determined
by the terms hereof to be deposited or pledged to the Authority) and to receive and use the issues
and profits of the Project.
6-2. Easement for Access or Utility Service The Authority is authorized, without notice
to or consent of the Holders of any Bonds, to join in the execution of a conveyance for access or
utility service and certain other easements and to subordinate the Lease to such easement
pursuant to Section 8.6 of the Lease or if the Lease has been terminated at the Authority's own
initiative, but only upon satisfaction of the applicable conditions set forth in said Section.
6-3. Release of Encumbered Equipment. The Authority is authorized, without notice to'
or consent of any Bondholders, to remove Project Equipment from time to time, provided that
the applicable conditions set forth in Section 3-2 of the Lease are met. If the Lessee or the
Authority desires to sell any Project Equipment that Authority has a fair market value in excess
of the fair market value of Project Equipment to be substituted therefor, the Authority may sell,
or permit such sale, without notice to or consent of any bondholders if the removed Project
Equipment is in good faith sold for cash and the net proceeds from the sale are deposited in the
Bond Fund.
6-4. Release of Unimproved Land. The Authority is hereby authorized, without notice to
or consent of any Bondholders, to join in the execution of such instruments as may be necessary
to release from the terms of the Lease unimproved Land, but only upon the satisfaction of the
applicable conditions set forth in Section 8.7 of the Lease.
x23x446.~ 31
ARTICLE SEVEN
INVESTMENTS
7-1. Investments by Authority. Subject to the provisions of Section 7-2, moneys held for
the credit of the Funds established by Article Five shall, to the extent practicable and permitted
by the Act, be invested as received and reinvested by the Authority in such securities asare
authorized by the Act after taking into consideration any recommendation made by the Lessee.
The Authority shall sell and reduce to cash funds a sufficient portion of investments under the
provisions of this Section whenever the cash balance in the Fund for which the investment was
made is insufficient for its current requirements. Securities so purchased as an investment of
moneys shall be paid by the Authority and shall be deemed at all times a part of the applicable
Fund, and the interest accruing thereon and any profit realized from such investments shall be
deemed at all times a part of the applicable Fund, and the interest accruing thereon and any profit
realized from such investments shall be credited to the Fund from which the investment was
made. Any loss resulting from such investment shall be charged to the Fund from which the
investment was made.
7-2. Return on Investments. The Authority will not cause any use to be made of the
proceeds of the Bonds to be issued which would cause such obligations to be arbitrage bonds
within the meaning of Section 148 of the Internal Revenue Code and any applicable and valid
temporary, proposed or final regulations from time to time promulgated thereunder if and to the
extent such provisions remain in full force and effect; and the Authority will comply with the
requirements of said Section 148 and with all such applicable regulations pertaining thereto
while the Bonds to be issued hereunder remain Outstanding.
ARTICLE EIGHT
DISCHARGE OF OBLIGATIONS TO BONDHOLDERS
8-1. Conditions of Discharge. When all of the Bonds issued and secured hereunder have
been discharged as provided in Section 8-2, and if all fees and expenses of the Authority and
Paying Agent required by this Resolution to be paid (other than sums deposited in escrow for
such purpose) have been paid, all pledges, covenants and other rights granted by this Resolution
shall cease as to the Holders of the Bonds, the Bonds shall no longer be considered Outstanding,
and the lien herein created upon any revenues derived from the Project may be discharged.
8-2. Payment of Bonds. (1) Bonds for the payment or redemption of which sufficient
cash shall have been deposited with the Paying Agent shall be deemed to be paid and discharged
within the meaning of this Section, provided, however, that if such Bonds are to be redeemed
prior to the maturity thereof, notice of such redemption shall have been duly. given and sufficient
cash shall also be deposited with the Paying Agent to pay any redemption premium.
(2) The Authority may also pay and discharge at any time any and all of the Bonds and
pay all future Paying Agent fees and expenses with respect thereto by irrevocably depositing in
escrow for the benefit of the Holders of said Bonds and the Paying Agent in a suitable banking
institution a sum of cash and securities in such aggregate face amount, bearing interest at such
rates and maturing or callable at the option of the holder thereof on such dates as shall be
required to provide amounts sufficient to pay when due (i) all redemption premiums, if any, on
the Bonds, (ii) all principal and interest due on said Bonds to their stated maturity dates or any
earlier permissible date upon which they may be redeemed prior to maturity in accordance with
their terms, (so long as notice of such redemption shall have been duly given as herein required),
and (iii) all such future Paying Agent fees and expenses; and provided further that the securities
deposited for this purpose shall be limited to securities which may be purchased for an escrow
account under the provisions of Section 475.67, Minnesota Statutes, or any amendments or
supplements thereto.
(3) All liability of the Authority to the Holders of any Bonds for the payment of principal
and interest and any premium thereon shall forthwith cease, terminate and be completely
discharged upon payment and discharge of the Bonds as provided in this section, and the Holders
shall have a claim therefor solely upon the cash or cash. and securities so deposited with the
Paying Agent or in escrow and shall not be entitled thereafter to any other benefit of or security
under this Resolution or the Lease.
(4) Any Bonds paid and discharged as provided in this Section 8-2 shall no longer be
deemed outstanding for the purposes of this Resolution.
ze3z446.t 33
8-3. Cancellation of Surrendered Bonds and Coupons. The Authority may at any time
surrender to the Paying Agent for cancellation by it any Bonds previously authenticated and
delivered hereunder, which the Authority acquired in any manner whatsoever, and such Bonds,
upon such surrender and cancellation, shall be deemed to be paid and retired.
~23~446.~ 34
ARTICLE NINE
SUPPLEMENTAL AND AMENDATORY RESOLUTIONS
9-1. Supplemental and Amendatory Resolutions Not Requiring Consent of Bondholders.
The Authority may, from time to time and at any time, without the consent of or notice to any of
the Bondholders, and when so required by this Resolution shall adopt a resolution or resolutions
supplemental to or amendatory of this Resolution as shall not be inconsistent with the terms and
provisions hereof (which supplemental or amendatory resolution or resolutions shall thereafter
form a part hereof), so as to thereby (1) permit the issuance of Additional Bonds as provided in
.Section 2-5, or duplicate Bonds as provided in Section 2-6, (2) cure any ambiguity or formal
defect or omission in this Resolution or in any supplemental resolution, (3) grant for the benefit
of the Bondholders any additional rights, remedies powers, authority or security that may
lawfully be granted to or conferred upon the Bondholders, (4) substitute or add additional
equipment, machinery or land or to release land or property in the manner specifically provided
herein or to more precisely identify any equipment or machinery forming a part of the Project and
generally described in Exhibit B and any other property, real or personal which may become a
part of the Project, (5) modify, eliminate and/or add to the provisions of this Resolution to such
extent as shall be necessary to prevent any interest on the Bonds from becoming taxable under
the Federal income tax laws or to allow the Bonds to be qualified under a different exemption
under Section 103 of the Internal Revenue Code, (6) make any other change determined by the
Authority necessary to reconcile the Resolution with the Lease or any amendment thereto or (7)
make any other change to the Resolution which in the reasonable judgment of the Authority is
not to the prejudice of any Holders of the Bonds who have not consented to the change.
9-2. Supplemental and Amendatow Resolution Requiring Consent of Bondholders.
Exclusive of supplemental and amendatory resolutions cOvered by Section 9-1 hereof and subject
to the terms and provisions contained in this Section, and not otherwise, the Authority upon
receipt of an instrument evidencing the consent to the below-mentioned supplemental or
amendatory resolution by the Holders of not less than fifty-one percent (51%) of the aggregate
principal amount of the Bonds outstanding, secured in accordance with the provisions of Sections
11-1 and 1-2, shall adopt such other resolution or resolutions supplemental or amendatory thereto
as shall be deemed necessary and desirable for the purpose of modifying, altering, amending,
adding to or rescinding, in any particular, any of the terms or provisions contained in this
Resolution or in any supplemental or amendatory resolt~tion; provided, however, that nothing
herein contained shall permit or be construed as permitting (1) an extension of the maturity of any
Bond of a nonconsenting Holder thereof, or (2) a reduction in the principal amount of any Bond
of a nonconsenting Holder thereof, or (3) a privilege or priority of any Bond or Bonds over any
other Bond or Bonds of a nonconsenting Holder thereof, or (4) a reduction in'the aggregate
principal amount of the Bonds required for consent to such supplemental or amendatory
resolution or (5) the subordination or release of the Authority's title to and security interest in the
Project except as otherwise permitted herein, without the consent of the Holders of one hundred
1231446.1 35
percent (100%) of the principal amount of the Bonds then outstanding (hereinafter "100%
Bondholder Consent") secured in accordance with Section 11-1.
Anything herein to the contrary notwithstanding, a supplemental or amendatory resolution
under this Article Nine which adversely affects the right of the Lessee under the Lease shall not
become effective unless and until the Lessee shall have consented in writing to the adoption and
delivery of such resolution, except supplemental or amendatory resolutions adopted after any
termination of the Lease. In this regard, the Authority shall cause notice of the proposed
adoption of any such supplemental or amendatory resolution, together with a copy of the
proposed amendatory resolution, to be mailed by certified or registered mail to the Lessee at least
fifteen (15) days prior to the proposed date of adoption and delivery of any such resolution. The
Lessee shall be deemed to have consented to the adoption and delivery of any such resolution if
the Authority does not receive a letter signed by a Representative of the Lessee of protest or
objection thereto on or before 4:30 o'clock P.M., Central Standard or Central Daylight time,
whichever is then in effect, of the fifteenth day after the mailing of the notice and a copy of the
proposed resolution to the Lessee unless such fifteenth day falls on a Business Day in which
event the letter of objection must be received on the next succeeding Business Day.
1231446.1 36
ARTICLE TEN
AMENDMENT TO LEASE
10-1. Amendments Without Bondholder Consent. The Authority and the Lessee may
without the consent of or notice to any of the Bondholders consent to any amendment, change or
modification of the Lease or the Ground Lease;
(1) to facilitate, (i) the conveyance of an easement for access or utility services and the
subordination of the rights of the Lessee, and the Authority under the Lease or the Ground Lease
to such easement as provided in Section 6-2, (ii) the release of equipment and unimproved land
as provided in Sections 6-3 and 6-4, or (iii) the issuance of Additional Bonds without
Bondholders' consent as provided by Section 2-5 or duplicate Bonds as provided in Section 2-6;
(2) which may be required by the provisions of the Lease, the Ground Lease or this
Resolution;
(3) for the purpose of curing any ambiguity or formal defect or omission;
(4) in connection with any property or equipment acquired and which constitutes a part
of the Project, including the Project Equipment described in Exhibit B, so as to more precisely
identify the same or substitute or add additional equipment supplied pursuant to the Lease or the
Ground Lease;
(5) to reconcile the Lease or the Ground Lease with any supplement to the Resolution; or
(6) to effect any other change therein which in the reasonable judgment of the Authority
is not to the prejudice of any Holders of the Bonds.
10-2. Amendments Requiring Bondholder Consent. Except for amendments, changes or
modifications as provided in Section 10-1 of this Resolution, neither the Authority nor the Lessee
shall consent to any other amendment, change or modification of the Lease or the Ground Lease
without publication of notice and the written approval or consent of the Holders of not less than
fifty-one percent (51%) in aggregate principal amount of the Bonds at the time outstanding given
and procured as provided in Sections 11-1 and 11-2. If. at any time the Lessee shall request the
consent of the Authority to any such proposed amendment, change or modification of the Lease
or the Ground Lease, the Authority shall in the absence of 100% Bondholder Consent, Upon
being satisfactorily indemnified with respect to expenses, cause notice of such proposed
amendment, change or modification to be published in the same manner as provided in Section
11-2.
~23~446.~ 37
ARTICLE ELEVEN
MISCELLANEOUS
11-1. Consent of Bondholders. Any consent, request, direction, approval, objection or
other instrument required by this Resolution to be signed and executed by the Bondholders may
be in any number of concurrent writings of similar tenor and must be signed or executed by such
Bondholders in person or by agent appointed in writing. Proof of the execution of any such
consent, request, direction, approval, objection or other instrument or of the writing appointing
any agent and of the ownership of Bonds, if made in the following manner, shall be sufficient for
any of the purposes of this Resolution, and shall be conclusive in favor of the Authority with
regard to any action taken by it under such request or other instrument, namely:
(1) The fact and date of the execution by any person of any such writing may be proved
by the certificate of any officer in any jurisdiction who by law has power to take acknowledge-
ments within said jurisdictions that the person signing such writing acknowledged before him the
execution thereof, or by an affidavit of any witness to such execution.
(2) The fact of the holding by any person of Bonds and the amounts and numbers of such
Bonds, and the date of the holding of the same, shall be proved by reference to the Bond
Register.
11-2. Notice of Amendments. If at any time the Authority desires to adopt any
supplemental or amendatory resolution and/or amend the Lease as herein provided without 100%
Bondholder Consent, unless consent of and notice to the Bondholders is not required, the
Authority shall cause notice of the proposed resolution or amendment to be published at least
once in a financial periodical or newspaper of general circulation published in a Minnesota city
of the first class or its metropolitan area. Such notice shall briefly set forth the nature of the
proposed resolution or amendment and shall state that copies thereof are on file at the principal
office of the Authority for inspection by all Bondholders. The Authority shall not, however, be
subject to any liability to any Bondholder by reason of its failure to publish such notice, and any
such failure shall not affect the validity of such resolution or amendment when consented to and
approved as herein provided. If the Holders of not less than fifty-one percent (51%) in aggregate
principal amount of the Bonds Outstanding hereunder at the time of the adoption of such
resolution or amendment shall have consented to and approved the adoption thereof as herein
provided, no Holder of any Bond shall have any right to object to any of the terms and provisions
contained 'therein, or the operation thereof or in any manner to question the propriety of the
adoption thereof, or to enjoin or restrain the Authority or the Lessee from adopting or executing
the same or from taking any action pursuant to the provisions thereof.
1123. Severability. If any provision of this Resolution shall be held or deemed to be or
shall, in fact, be inoperative or unenforceable as applied in any particular case in any jurisdiction
or jurisdictions or in all jurisdictions or in all cases because it conflicts with any provisions of
any constitution or statute or rule or public policy, or for any other reason, such circumstances
shall not have the effect of rendering the provision in question inoperative or unenforceable in
any other case or circumstance, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to any extent whatever. The invalidity of any one
or more phrases, sentences, clauses or paragraphs in this Resolution contained shall not affect the
remaining portions of this Resolution or any part thereof.
11-4. Authentication of Transcript. The officers of the Authority are directed to furnish
to the attorneys approving the legality thereof, certified copies of this Resolution and all
documents referred to herein, and affidavits or certificates as to all other matters which are
reasonably necessary to evidence the validity and marketability of the Bonds. All such certified
copies, certificates and affidavits, including any heretofore furnished, shall constitute recitals of
the Authority as to the correctness of all statements contained therein.
11-5. Limitation of Liability. To the extent permitted by law, no provision, covenant nor
agreement contained in this Resolution shall give rise or impose upon the Lessee or the Authority
or any of its officers, employees or agents any pecuniary liability.
11-6. Registration of Bond Resolution The Executive Director of the Authority is
authorized and directed to cause a copy of this Resolution to be filed with the County Auditors of
Hennepin and Carver Counties, and to obtain from the County Auditors certificates that the
Bonds have been duly entered upon the Auditor's Bond register.
11-7. Approval of Lessee. The Lessee has examined and given approval of this
Resolution and all terms hereof and approves the sale of the Bonds as provided for herein for the
price and terms set forth herein.
11-8. Authorization to Execute Lease, Ground Lease and Incidental Documents. The
forms of the proposed Lease and Ground Lease between the Authority and Lessee are hereby
approved and the Chairperson and Executive Director of the Authority are authorized to execute
the same, the official statement to be used by the Purchaser in marketing the Bonds, and such
other documents as Bond Counsel or Independent Counsel consider appropriate for Bond
Closing, in the name of and on behalf of the Authority.
11-9. Payment of Issuance Expenses. The Authority authorizes the Purchaser to forward
the amount of Bond proceeds allocable to the payment of issuance expenses to Resource Bank &
Trust Company, Minneapolis, Minnesota on the Bond Closing for further distribution as directed
by the Authority's financial advisor, Ehlers and Associates, Inc.
1231446.1 39
Adopted: Dec, ember 4, 2000.
Attest:
Executive Director
EXHIBIT A
LEGAL DESCRIPTION OF REAL ESTATE
Land lying and being in the County of Carver and State of Minnesota, described as follo~vs:
That part of the following described property:
The Southwest Quarter of the Southwest Quarter of 8ectlon 11, Town~hip 116
North, Range 23 West of the Sth Principal Meridian; except that part described
as commencing at the southwest corner of said Southwest Quarter of the South-
west Quarter; thence on an assumed bearing of South 87 degrees, 42 minutes
and 50 seconds East, along the south line thereof, a distance of 642.00 feet,
to the point of beginning of the'land to be described; thence North 2 degrees,
45 minutes and 41 seconds East, a distance of 277.0S feet; thence South 88 ·
degrees, 48 minutes and 27 seconds East, a distance of 19S.00 feet; thence
South 9 degrees, 05 minutes and 37 seconds East, a distance of 286.39 feet,
to the south line of said Southwest Quarter of the Southwest Quarter; thence
North 87 degrees, 42 minutes and 50 seconds West, along said south line, a
distance of 253.77 feet, to the' point of beginning.
And Government Lot $, Section 11, Township 116 North, Range 23 West of the
Sth Principal Meridian.
Lying west of a line 727.00 feet east of, measured at right angles to and parallel
with the west line of the Southwest Quarter of said Section 11.
Subject to public right-of-way easement tn State Highway No. 5.
EXHIBIT B
PROJECT
The construction and equipping of an approximate 9,760 square foot municipal building.
x23x446.~ B-1