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HomeMy WebLinkAboutCity Council Resolution 1987-4220 After due consideration of the bids, Councilmember Sisk introduced the following resolution and moved its adoption: RESOLUTION NO. 87-422 A RESOLUTION AWARDING THE SALE OF $3,300,000 GENERAL OBLIGATION WATER REVENUE BONDS OF 1987; FIXING THEIR FORM AND SPECIFICATIONS; DIRECTING THEIR EXECUTION AND DELIVERY; AND PROVIDING FOR THEIR PAYMENT BE IT RESOLVED By the City Council of the City of Plymouth, Hennepin County, Minnesota (City), as follows: Section 1. Sale of Bonds. 1.01. The bid of _Continental Illinois National Bank (Purchaser) to purchase $3,300,000 General Obligation Water Revenue Bonds of 1987 (Bonds) of the City described in the Official Notice of Sale thereof is hereby found and determined to be the highest and best bid received pursuant to duly advertised notice of sale and shall be and is hereby accepted, such bid being to purchase the Bonds at a price of $ plus accrued interest to date of delivery, _for Bonds bearing interest as follows: Year of Interest Year of Interest Maturity Rate Maturity Rate 1989 1998 1990 1999 1991 2000 1992 2001 1993 2002 1994 1995 1996 1997 Net effective interest rate: 1.02. The sum of $ being the amount bid by the Purchaser in excess of $3,250,500 shall be credited to the Debt Service Fund hereinafter' created. The Finance Director is directed to retain the good faith check of the Purchaser pending completion of the sale and delivery of the Bonds, and to return the checks of the unsuccessful bidders forthwith. The Mayor and City Manager are directed to execute a contract with the Purchaser on behalf of the City. 1.03. The City shall forthwith issue and sell the Bonds in the total prin- cipal amount of $3,300,000, originally dated June 16, 1987, in the denomination of $5,000 each or any integral multiple thereof, numbered No. R-1 upward, bearing interest as above set forth, and which Bonds mature serially on February 1 in the years and amounts as follows: Year Amount Year Amount 1989 $150,000 1996 ;225,000 1990 175,000 1997 250,000 1991 175,000 1998 275,000 1992 175,000 1999 275,000 1993 200.000 2000 300,000 1994 200.000 2001 325,000 1995 225,000 2002 350,000 1.04. Optional Redemption. The City may elect on February 1, 1995, and on any interest payment date thereafter, to prepay Bonds maturing on or after February 1. 1996. Redemption may be in whole or in part of the Bonds subject to prepayment, If redemption is in part, those Bonds remaining unpaid which have the latest maturity date will be prepaid first. If only part of the Bonds having a common maturity date are called for prepayment the specific Bonds to be prepaid will be chosen by lot by the Registrar. All prepayments shall be at a price of par plus accrued interest. Section 2. Registration and Payment. 2.01. Registered Form. The Bonds shall be issued only in fully registered form. The interest thereon and, upon surrender of each Bond, the principal amount thereof shall be payable by check or draft issued by the Registrar described herein. 2.02. Dates: Interest Payment Dates. Each Bond shall be dated as of the last interest payment date preceding the date of authentication to which inter- est on tl4e Bond has been paid or made available for payment, unless (i) the date of authentication is an interest payment date to -which interest has been paid or made available for payment, in which case such Bond shall be dated as of the date of authentication, or (11) the date of authentication is prior to the first Interest payment date, in which case such Bond shall be dated as of the date of original issue. The interest on the Bonds shall be payable on February 1 and August 1 of each year, commencing February 1, 1988, to the owner of record thereof as of the close of business on the fifteenth day of the immediately preceding month, whether or not such day In a business day. 2.03. Registration. The City shall appoint, and shall maintain, a bond registrar, transfer agent. authenticating agent and paying agent (Registrar). The effect of registration and the rights and duties of the City and the Regis- trar with respect thereto shall be as follows: (a) Register. The Registrar shall keep at its principal corporate trust office a bond register in which the Registrar &:.all provide for the registration of ownership of Bonds and the registration of transfers and exchanges of Bonds entitled to be registered, transferred or exchanged. (b) Transfer of Bonds. Upon surrender for transfer of any Bond duly endorsed by the registered owner thereof or accompanied by a written Instrument of transfer, in form satisfactory to the Registrar, duly r z r executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Bonds of a like aggregate principal amount and maturity, as requested by the transferor. The Registrar may. however. close the books for registration of any transfer after the fifteenth day of the month preceding each interest payment date and until such interest payment date. (c) Exchange of Bonds. Whenever any Bonds . a surrendered by the registered owner for exchange the Registrar shall authenticate and deliver one or more new Bonds of a like aggregate principal amount and maturity, as requested by the registered owner or the owner's attorney in writing. (d) Cancellation. All Bonds surrendered upon any transfer or ex- change shall be promptly cancelled by the Registrar and thereafter disposed of as directed by the City. (e) Improper or Unauthorized Transfer. When any Bond is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such Bond or separate Instru- ment of transfer is valid and genuine and that the requested transfer is legally authorized. The Registrar shall incur no liability for the re- fusal, in good faith. to make transfers which it, in its judgment, deems improper or unauthorized. (f) Persons Deemed Owners. The City and the Registrar my treat the person in whose name any Bond is at any time registered in the bond regis- ter as the absolute owner of such Bond, whether such Bond shall be overdue or not. for the purpose of receiving payment of. or on account of, the principal of and interest on such Bond and for all other purposes. and all such payments so made to any such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid. (g) Taxes, Fees and Charges. For every transfer or exchange of Bonds. the Registrar my impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee or other governmental charge required to be paid with respect to such transfer or exchange. (h) Mutilated, Lost, Stolen or Destroyed Bonds. In case any Bond shall become mutilated or be destroyed, stolen or lost, the Registrar shall deliver a new Bond of like amount, number, maturity date and tenor in exchange and substitution for and upon cancellation of any such mutilated Bond or in lieu of and in substitution for any such Bond destroyed, stolen - or lost, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a Bond destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to It that such Bond was destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or Indemnity in form, substance and amount satisfactory to it, in which both the City and the Registrar shall be named as obligees. All Bonds so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the City. If the mutilated, destroyed, stolen or lost Bond has already matured or been called for redemption in • accordance with its terms it shall not be necessary to issue a new Bond prior to payment. (1) Redemption. In the event any of the Bonds are called for redemp- tion, notice thereof identifying the Bonds to be redeemed will be given by the Registrar by mailing a copy of the redemption notice by first class mail (postage prepaid) not more than 60 and not less than 30 days prior to the data fixed for redemption to the registered owner of each Bond to be redeemed at the address sham on the registration books kept by the Regis- trar and by publishing said notice in the manner required by law. Failure to give such notice by publication or by mail to any registered owner, or any defect therein, will not affect the validity of any proceeding for the redemption of Bonds. All Bonds so called for redemption will cease to bear Interest after the specified redemption date, provided that the funds for the redemption are on deposit with the place of payment at that time. 2.04. Appointment of Initial Registrar. The City hereby appoints Norwest Bank Minneapolis. National Association, Minneapolis, Minnesota, as the initial Registrar. The Mayor and the Manager are authorized to execute and deliver, on behalf of the City. a contract with the Registrar. Upon merger or consolidation of the Registrar with another corporation, if the resulting corporation is a bank or trust company authorized by law to conduct such business, such corpo- ration shall be authorized to act as successor Registrar. The City agrees to pay the reasonable and customary charges of the Registrar for the services performed. The City reserves the right to remove the Registrar upon 30 days' •notice and upon the appointment of a successor Registrar, in which event the predecessor Registrar shall deliver all cash and Bonds in its possession to the successor Registrar and shall deliver the bond register to the successor Regis- trar. On or before each principal or interest due date, without further order of this Council. the Finance Director shall transmit to the Registrar moneys sufficient for the payment of all principal and interest then due. 2.05. Execution, Authenticatidn and Delivery. The Bonds shall be prepared under the direction of the Clerk and shall be executed on behalf of the City by the signatures of the Mayor and the Manager, provided that all signatures may be printed, engraved or lithographed facsimiles of the originals. In case any officer whose signature or a facsimile of whose signature shall appear on the Bonds shall cease to be such officer before the delivery of any Bond, such signature or facsimile shall nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in office until delivery. Notwithstanding such execution, no Bond shall be valid or obligatory for any purpose or entitled to any security or benefit under this Resolution unless and until a certificate of authentication on such Bond has been duly executed by the manual signature of an authorised representative of the Registrar. Certificates of authentication on different Bonds need not be signed by the same representa- tive. The executed certificate of authentication on each Bond shall be conclu- sive evidence that it has been authenticated and delivered under this Resolu- tion. When the Bonds have been so prepared, executed and authenticated, the Finance Director shall deliver the same to the Purchaser thereof upon payment of the purchase price in accordance with the contract of sale heretofore made and executed, and the Purchaser shall not be obligated to see to the application of the purchase price. 2.06. Temporary Bonds. The City may elect to deliver in lieu of printed Rdefinitive bonds, one or more typewritten temporary bonds in substantially the form set forth in Section 3 with such changes as may be necessary to reflect more than one maturity in a single temporary bond. Upon the execution and delivery of definitive bonds the temporary bonds shall be exchanged therefor and cancelled. Section 3. Form of Bond. 3.01. The Bonds shall be printed in substantially the following form: Rate Maturity x No. R- [Face of the Bond) UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF PLYMOUTH GENERAL OBLIGATION WATER REVENUE BOND OF 1987 Date of Original Issue CUSIP June 16, 1987 s The City of Plymouth, a du-- nr-.anized and existing municipal corporation In Hennepin County, Minnesota (City), acknowledges itself to be indebted and for value received hereby promises to pay to or registered assigns, the principal sum of $ on the maturity date specified above, with interest thereon from the date hereof at the annual rate specified above. payable February 1 and August 1 in each year, commencing February 1. 1988, to the person in whose name this Bond is registered at the close of business on the fifteenth day (whether or not a busiuess day) of the immediately preceding month. The interest hereon and, upon presentation and surrend-r hereof, the principal hereof are payable in lawful money of the United - States of. America by check or draft by Norwest Bank Minneapolis, National Association, Minneapolis. Minnesota. as Bond Registrar, Paying Agent, Transfer Agent, and Authenticating Agent, or its designated successor under the Resolu- tion described herein. For the prompt and full payment of such principal and Interest as the same respectively become due, the full faith and credit and taxing powers of the City have been and are hereby irrevocably pledged. The City may elect on February 1. 1995, and on any interest payment date thereafter, to prepay Bonds of this issue maturing on or after February 1, 1996. P_16deaption may be in whole or in part of the Bonds subject to prepayment. If •redemption is in part. those Bonds remaining unpaid which have the latest maturity date will be prepaid first. If only part of the Bonds having a common maturity date are called for prepayment the specific Bonds to be prepaid will be chosen by lot by the Registrar. All prepayments shall be at a price of par plus accrued interest. The City Council has designated the Bonds as "qualified tax exempt obliga- tions" within the meaning of Section 265 (b)(3) of the Internal Revenue Code of 1986 (the Code) and within the $10 million limit allowed by the Code for the current calendar year of issue. Additional provisicne of this Bond are contained on the reverse hereof and such provisions shall for all purposes have the same effect as though fully set forth in this place. This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the Resolution until the Certificate of Authentication hereon shall have been executed by the Bond Registrar by manual signature of one of its authorized representatives. IN WITNESS WHEREOF, the City of Plymouth, Hennepin County, Minnesota, by Its City Council. has caused this Bond to be executed on its behalf by the ,acsimile signatures of the Mayor and Manager and has caused this Bond to be dated as of the date set forth below. Dated: CITY OF PLYMOUTH, MINNESOTA (facsimile) (facsimile) City Manager Mayor CERTIFICATE OF AUTHENTICATION This is one of the Bonds delivered pursuant to the Resolution mentioned within. By Authorized Representative [Reverse of the Bond] This Bond is one of an issue in the aggregate principal amount of 0$3,300,000, all of like original issue date and tenor, except as to number, maturity date, redemption privilege and interest rate, issued pursuant to a r zz •resolution adopted by the City Council on June ZZ, 1987 (the Resolution), for the purpose of providing money to aid in financing various improvements to the water system of the City. as authorized by Minnesota Statutes, Section 444.075, and the principal hereof and interest hereon are payable primarily from the net revenues of the water system of the City in a special debt service fund of the City. as set forth in the Resolution to which reference is made for a full statement of rights and powers thereby conferred. The full faith and credit of the City are irrevocably pledged for payment of this Bond, and the City Council has obligated itself to levy taxes on all taxable property in the City in the event of any deficiency in net revenues and taxes pledged, which taxes may be levied without limitation as to rate or amount. The Bonds of this series are issued only as fully registered Bonds in denominations of $5,000 or any integral multiple thereof of single maturities. IT IS HEREBY CERTIFIED AND RECITED That in and by the Resolution, the City has covenanted and agreed that it will continue to own and operate the water plant and system, free from competition by other like utilities; that adequate Insurance on the system and suitable fidelity bonds on employees -ill be car- ried; that proper and adequate books of account will be kept showing all re- ceipts and disbursements relating to the Water Fund, into which it will pay all of the gross revenues from the water system; that it will also create and maintain a General Obligation Water Revenue Bonds of 1987 Debt Service Fund, into which it will pay. out of the net revenues from the water system a sum sufficient to pay principal hereof and interest hereon when due; and that it will provide, by ad valorem tax levies. for any deficiency in required net sewer • system revenues. As provided in the Resolution and subject to certain limitations set forth therein, this Bond is transferable upon the books of the City at the principal office of the Bond Registrar, by the registered owner hereof in person or by the owner's attorney duly authorized in writing upon surrender hereof together with a written instrument of transfer satisfactory to the Bond Registrar, duly executed by the registered owner or the owner's attorney; and may also be surrendered in exchange for Bonds of other authorized denominations. Upon such transfer or exchange the City will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of the same aggregate principal amount, bearing interest at the same rate and maturing on the same date, subject to reimbursement for any tax, fee or governmental charge required to be paid with respect to such transfer or exchange. The City and the Bond Registrar may deem and treat the person in whose -game this Bond is registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of receiving payment and for all other purposes, and neither the City nor the Bond Registrar shall be affected by any notice to - the contrary. IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be performed preliminary to and in the issuance of this Bond in order to make it a valid and binding general obligation of the City in accordance with its terms, have been done. do exist, have happened and have been performed as so required, and that the issuance of this Bond does not cause the indebtedness of the City to exceed any constitu- tional or statutory limitation of indebtedness. (Form of certificate to be printed on the reverse side of each Bond, following a full copy of the legal opinion.) I certify that the above is a full. true and correct copy of the legal pinion rendered by bond counsel on the issue of Bonds of the City of Plymouth, Minnesota, which includes the within Bond, dated as of the date of delivery of and payment for the Bonds. (Facsimile Signature) City Clerk 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 accord- ing to applicable laws or regulations: TEN COM -- as tenants UNIF GIFT MIN ACT Custodian in common (Cult (Minor TEN ENT -- as tenants by entireties under Uniform Gifts or Transfers to Minors JT TEN -- as joint tenants with right of survivorship and Act . . . . . . . . . . . not as tenants in common (State) Additional abbreviations may also be used though not in the above list. ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto the within Bond and all rights thereunder, and does hereby irrevocably constitute and appoint attorney to transfer the said Bond on the books kept for registration of the within Bond, with full power of substitution in the premises. Dated: Nctice: The assignor's signature to this assignment must correspond with the name as it appears upon the face of the within Bond in every particular, without alteration or any change whatever. • Signature Guaranteed: Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm having a membership in one of the major stock exchanges. The Bond Registrar will not effect transfer of this Bond unless the infor- mation concerning the assignee requested below is provided. Name and Address: (Include information for all joint owners if this Bond is held by joint account.) Please insert social security or other identifying number of assignee. 3.02. The Clerk shall obtain a copy of the proposed approving legal opinion of LeFevere, Lefler, Kennedy, O'Brien 6 Drawz, a Professional Asso- ciation, Minneapolis, Minnesota, which shall be complete except as to dating thereof and shall cause the opinion to be printed on each Bond, together with a certificate to be signed by the facsimile signature of the Clerk in substantial- ly the form set forth in the form of Bond. The Clerk is hereby authorized and directed to execute such certificate in the name of the City upon receipt of such opinion and to file the opinion in the City offices. Section 4. Payment: Security: Pledges and Covenants. 4.01. The City shall continue to operate its Water Fund to which shall be credited all gross revenues of the water system and out of which shall be paid all normal and reasonable expenses of current operations of the water system. Any balance therein shall be deemed net revenues and shall be transferred, from time to time, together with general taxes hereafter levied, to a General Obliga- tion Water Revenue Bonds of 1987 Debt Service Fund (Debt Service Fund) hereby created in the Water Fund, which fund shall be used only to pay principal of and interest on the Bonds and any other bonds similarly authorized. There shall always be retained in the Debt Service Fund a sufficient amount to pay principal of and interest on all the Bonds, and the Finance Director shall report any current or anticipated deficiency in the Debt Service Fund to the City Council. 4.02. The City Council covenants and agrees with the holders of the Bonds that so long as any of the Bonds remain outstanding and unpaid, it will keep and enforce the following covenants and agreements: (a) The City will continue to maintain and efficiently operate the water system as a public utility and convenience free from competition of other like utilities and will cause all revenues therefrom to be deposited in bank accounts and credited to the water system accounts as hereinabove provided, and will make no expenditures from said accounts except for a duly authorized purpose and in accordance with this resolution. (b) The City will also mai stain the Debt Service Fund as a separate account in the Water Fund and will cause money to be credited thereto from time to time, out of net reven:,es from the water system and ad valorem taxes, in sums sufficient to pa, principal of and interest on the Bonds when due. (c) The City will keep and maintain proper and adequate books of records and accounts separate from all other records of the City in which will be complete and correct entries as to all transactions relating to the water system and which shall be open to inspection and copying by any bondholder, his agent or attorney, at any reasonable time, and it will furnish certified transcripts therefrom upon request and upon payment of a reasonable fee therefor, and said account shall be audited at least annual- ly by a qualified public accountant and statements of such audit and report will be furnished to all bondholders upon request. (d) The City Council will cause all persons handling revenues of the water system to be bonded in reasonable amounts for the protection of the City and the bondholders and will cause the funds collected on account of the operations of the water system to be deposited in a bank whose deposits are guaranteed under the Federal Deposit Insurance Law. (e) The Council will keep the water system insured at all times against loss by fire, tornado and other risks customarily insured against with an insurer or insurers in good standing, in such amounts as are customary for like systems, to protect the holders, from time to time, of the Bonds and the City from any loss due to any such casualty and will apply the proceeds of such insurance to make good any such loss. (f) The City and each and all of its officers will punctually perform all duties with reference to the water system as required by the laws of the State of Minnesota. (g) The City will impose and collect charges of the nature authorized by Minnesota Statutes, section 444.075 at the times and in the amounts required to produce, together with any taxes designated as a source of payment of the Bonds, net revenues adequate to pay all principal and interest when due on the Bonds and to create and maintain such reserves securing said payments as may be provided in this resolution. (h) The City Council will levy general ad valorem taxes on all taxable property in the City, when required to meet any deficiency in net revenues. 4.03. It is hereby determin-d that the estimated collections of net water system revenues will produce at ltast five percent in excess of the amount needed to meet when due, the princilal and interest payments on the Bonds and that no tax lv�ry is needed at this time. The City Clerk is directed to file a certified copy of this resolution with the Auditor of Hennepin County, and •obtain the certificate required by Minnesota Statutes, Section 475.63. Section 5. Authentication of Transcript. 5.01. The officers of the City are hereby authorized and directed to prepare and furnish to the Purchaser and to the attorneys approving the Bonds, certified copies of proceedings and records of the City relating to the Bonds and to the financial condition and affairs of the City, and such other certifi- cates, affidavits and transcripts as may be required to show the facts within their knowledge or as shown by the books and records in their custody and under their control, relating to the validity and marketability of the Bonds and such Instruments, including any heretofore furnished, shall be deemed representations of the City as to the facts stated therein. 5.02. The Mayor, Manager and Finance Director are hereby authorized and directed to certify that they have examined the Official Statement prepared and circulated in cc nection with the issuance and sale of the Bonds and that to the best of their knowledge and belief said statement is a complete and accurate representation of the facts and representations made therein as of the date of the Official Statement. Sec. 6. Special Tax Covenant. 6.01. (a) The City covenants and agrees with the holders from time to timE of the Bonds that it will not take or permit to be taken by any of its *officers, employees or agents any action which would cause the interest on the Bonds to become subject Co taxation under the Internal Revenue Code of 1986, as amended (the Code), and the Treasury Regulations promulgated thereunder, in effect at the time of such actions, and that it will take or cause its officers, employees or agents to take, all affirmative action within its power that may be necessary to ensure that such interest will not become subject to taxation under the Code and applicable Treasury Regulations, as presently existing or as hereafter amended and made applicable to the Bonds. (b) The City shall comply with requirements necessary under the Code to establish and maintain the exclusion from gross income under Section 103 of the Code of the interest on the Bonds, including without limitation requirements relating to temporary periods for investments, limitations on amounts invested at a yield greater than the yield on the Bonds, and the rebate of excess Invest- ment earnings to the United States if the Bonds (together with other obligations reasonably expected to be issued in calendar year 1987) exceed the small -issuer exception amount of $5,000,000. For purposes of qualifying for the small -issuer exception to the federal arbitrage rebate requirements, the City hereby finds, •determines ano declares that the aggregate face amount of all tax-exempt bonds (other than private activity bonds) issued by the City (and all subordinate entities of the City) during the calendar year in which the Bonds are issued and outstanding at one time is not reasonably expected to exceed $5,000,000, all within the meaning of Section 148(f)(4)(C) of the Code. 6.02. The City further covenants not to use the proceeds of the Bonds or to cause or permit them or any of them to be used, in such a manner as to cause the Bonds to be "private activity bonds" within the meaning of Sections 103 and 141 through 150 of the Code. 6.03. In order to qualify the Bonds as "qualified tax-exempt obligations" . within the meaning of Section 265(b)(3) of the Code, the City hereby makes the following factual statements and representations: (a) the Bonds are not "private activity bonds" as defined in Section 141 of the Code; (b) the City hereby designates the Bonds as "qualified tax-exempt obligations" for purposes of Section 265(b)(3) of the Code. (c) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will be issued by the City (and all subordinate entities of the City) during calendar year 1987 will not exceed $10,000,000; and (d) not more than $10,000,000 of obligations issued by the City during calendar year 1987 have been designated for purposes of Section 265(b)(3) of the Code. The City shall use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designation made by this paragraph. DThe motion for the adoption of the foregoing resolution was duly seconded by Councilmember Vasiliou , and upon vote being taken thereon, the following voted in favor thereof: Mayor Schneider, Councilmembers Crain, Sisk, Vasiliou and Zitur and the following voted against: None whereupon said resolution was declared duly passed and adopted.