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HomeMy WebLinkAbout1992-042 Council ResolutionExtract of Minutes of Meeting of the City Council of the City of Lino Lakes, Anoka County, Minnesota Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Lino Lakes, Minnesota, was duly held in the City Hall in said City on Monday, March 23, 1992, commencing at 6:30 P.M. The following members were present: Linda Elliott, Sally Kuether, Wesley Neal and the following were absent: Mayor Vernon Reinert * * * The Mayor announced that the next order of business was consideration of the proposals which had been received for the purchase of the City's $1,060,000 General Obligation Water Revenue Bonds, Series 1992B . The City Administrator presented a tabulation of the proposals which had been received in the manner specified in the Terms of Proposal of the Bonds. The proposals were as follows: 8NG31647 L11140-23 AWARD: SPRINGSTED PUBLIC FINANCE ADVISORS Home Office 85 East Seventh Place Suite 100 Saint Paul, MN 55101-2143 (612) 223-3000 Fax: (612) 223-3002 222 South Ninth Street Suite 2825 Minneapolis, MN 55402-3368 (612) 333-9177 Fax: (612) 333-2363 16655 West Bluemound Road Suite 290 Brookfield, WI 53005-5935 (414) 782-8222 Fax: (414) 782-2904 6800 College Boulevard Suite 600 Overland Park, KS 6621 1-1 533 (913) 345-8062 Fax: (913) 345-1770 $1,060,000 CITY OF LINO LAKES, MINNESOTA GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 1992B PIPER, JAFFRAY & HOPWOOD INCORPORATED And Associates - In Association With - FBS INVESTMENT SERVICES, INC. NORWEST INVESTMENT SERVICES, INCORPORATED SALE: March 23, 1992 Moody's Rating: Baa Bidder Interest Rates Price Net Interest True Interest Cost Rate PIPER, JAFFRAY & HOPWOOD INCORPORATED American National Bank Saint Paul Juran & Moody, Incorporated Miller, Johnson & Kuehn, Inc. Craig-Hallum, Incorporated Moore, Juran and Company, Incorporated - In Association With - FBS INVESTMENT SERVICES, INC. NORWEST INVESTMENT SERVICES, INCORPORATED 4.50% 1994 5.10% 1995 5.25% 1996 5.50% 1997 5.75% 1998 6.00% 1999 6.15% 2000 6.30% 2001 6.40% 2002 6.50% 2003 6.60% 2004 6.70% 2005-2006 6.80% 2007-2008 $1,044,100.00 $728,076.67 6.6720% These Bonds are being reoffered at par. BBI: 6.79 Average Maturity: 10.32 Years After due consideration of the proposals, Member Kuether then introduced the following written resolution and moved its adoption the reading of which had been dispensed with by unanimous consent: RESOLUTION NO. 92-42 A RESOLUTION AWARDING THE SALE OF $1,060,000 GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 1992B; 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 Lino Lakes, Anoka County, Minnesota (City) as follows: Section 1. Sale of Bonds. 1.01. Theproposalof Piper, Jaffray & Hopwood Incorporated (Purchaser) to purchase $1,060,000 General Obligation Water Revenue Bonds, Series 1992B (Bonds) of the City described in the Terms of Proposal thereof is found and determined to be the highest and best proposal received and is accepted, the proposal being to purchase the Bonds at a price of $ 1,044,100 plus accrued interest to date of delivery, for Bonds bearing interest as follows: Year of Interest Year of Interest Maturity Rate Maturity Rate 1994 4.50% 2002 6.40% 1995 5.10 2003 6.50 1996 5.25 2004 6.60 1997 5.50 2005 6.70 1998 5.75 2006 6.70 1999 6.00 2007 6.80 2000 6.15 2008 6.80 2001 6.30 True interest rate: 6.6720% 1.02. The sum of $ -0- being the amount proposal by the Purchaser in excess of $1,044,100 will be credited to the Debt Service Fund hereinafter created. The City Clerk -Treasurer is directed to retain the good faith check of the Purchaser, pending completion of the sale of the Bonds, and to return the good faith checks of the unsuccessful bidders forthwith. The Mayor and City Clerk -Treasurer 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 principal amount of $1,060,000, originally dated April 1, 1992, 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 mature serially on February 1 in the years and amounts as follows: SNG31647 LN140-23 Year Amount Year Amount 1994 $ 25,000 2002 $ 75,000 1995 40,000 2003 80,000 1996 50,000 2004 85,000 1997 50,000 2005 90,000 1998 55,000 2006 100,000 1999 55,000 2007 105,000 2000 65,000 2008 115,000 2001 70,000 1.04. Optional Redemption. The City may elect on February 1, 2001 and on any date thereafter to prepay Bonds maturing on or after February 1, 2002. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, it shall be in such order as the City shall determine. 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 payments will 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, is payable by check or draft issued by the Registrar described herein. 2.02. Dates; Interest Payment Dates. Each Bond will be dated as of the last interest payment date preceding the date of authentication to which interest on the 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 (ii) the date of authentication is prior to the first interest payment date, in which case such Bond will be dated as of the date of original issue. The interest on the Bonds will be payable on February 1 and August 1 of each year, commencing February 1, 1993, 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 is a business day. 2.03. Registration. The City will 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 Registrar with respect thereto are as follows: (a) Register. The Registrar must keep at its principal corporate trust office a bond register in which the Registrar provides 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 a Bond duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar will 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 81fG31647 13140-23 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. When Bonds are surrendered by the registered owner for exchange the Registrar will 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. Bonds surrendered upon any transfer or exchange will be promptly cancelled by the Registrar and thereafter disposed of as directed by the City. (e) Improper or Unauthorized Transfer. When a Bond is presented to the Registrar for transfer, the Registrar may refuse to transfer the Bond until the Registrar is satisfied that the endorsement on the Bond or separate instrument of transfer is valid and genuine and that the requested transfer is legally authorized. The Registrar will incur no liability for the refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. (f) Persons Deemed Owners. The City and the Registrar may treat the person in whose name a Bond is registered in the bond register as the absolute owner of the Bond, whether the Bond is overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on the Bond and for all other purposes, and payments so made to a �- registered owner or upon the owner's order will 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 a transfer or exchange of Bonds, the Registrar may 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 the transfer or exchange. (h) Mutilated, Lost, Stolen or Destroyed Bonds. If a Bond becomes mutilated or is destroyed, stolen or lost, the Registrar will deliver a new Bond of like amount, number, maturity date and tenor in exchange and substitution for and upon cancellation of the mutilated Bond or in lieu of and in substitution for a 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 the 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 and as provided by law, in which both the City and the Registrar must be named as obligees. Bonds so surrendered to the Registrar will be cancelled by the Registrar and evidence of such cancellation must 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 is not necessary to issue a new Bond prior to payment. (i) Redemption. In the event any of the Bonds are called for redemption, notice thereof identifying the Bonds to be redeemed will be given 8NG31647 LN140-23 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 date fixed for redemption to the registered owner of each Bond to be redeemed at the address shown on the registration books kept by the Registrar and by publishing the notice in the manner required by law. Failure to give 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. 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 appoints Norwest Bank Minnesota, National Association, Minneapolis, Minnesota, as the initial Registrar. The Mayor and the City Clerk -Treasurer are authorized to execute and deliver, on behalf of the City, a contract with the Registrar. Upon merger or con- solidation of the Registrar with another corporation, if the resulting corporation is a bank or trust company authorized by law to conduct such business, such corporation is 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 must deliver all cash and Bonds in its possession to the successor Registrar and must deliver the bond register to the successor Registrar. On or before each principal or interest due date, without further order of this Council, the Treasurer must transmit to the Registrar moneys sufficient for the payment of all principal and interest then due. 2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the direction of the Clerk -Treasurer and executed on behalf of the City by the signatures of the Mayor and the Clerk -Treasurer, 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 appears on the Bonds ceases to be such officer before the delivery of any Bond, such signature or facsimile will nevertheless be valid and sufficient for all purposes, the same as if the officer had remained in office until delivery. Notwithstanding such execution, a Bond will not 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 the Bond has been duly executed by the manual signature of an authorized representative of the Regis- trar. Certificates of authentication on different Bonds need not be signed by the same representative. The executed certificate of authentication on each Bond is conclusive evidence that it has been authenticated and delivered under this Resolu- tion. When the Bonds have been so prepared, executed and authenticated, the Clerk -Treasurer shall deliver the same to the Purchaser upon payment of the pur- chase price in accordance with the contract of sale heretofore made and executed, and the Purchaser is not obligated to see to the application of the purchase price. 2.06. Temporary Bonds. The City may elect to deliver in lieu of printed definitive 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 will be exchanged therefor and cancelled. 811031647 1.11140-23 Section 3. Form of Bond. 3.01. The Bonds will be printed in substantially the following form: [Face of the Bond] UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF ANOKA CITY OF LINO LAKES GENERAL OBLIGATION WATER REVENUE BOND, SERIES 1992B Date of Rate Maturity Original Issue April 1, 1992 CUSIP No. $ The City of Lino Lakes, Minnesota, a duly organized and existing municipal corporation in Anoka 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, 1993, to the person in whose name this Bond is registered at the close of business on the fifteenth day (whether or not a business day) of the immediately preceding month. The interest hereon and, upon presentation and surrender hereof, the principal hereof are payable in lawful money of the United States of America by check or draft by , Minnesota, as Bond Registrar, Paying Agent, Transfer Agent and Authenticating Agent, or its designated successor under the Resolution 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 irrevo- cably pledged. The City may elect on February 1, 2001, and on any date thereafter, to prepay Bonds of this issue maturing on or after February 1, 2002. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in part, it shall be in such order as the City shall determine. 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, ... as amended (the Code) relating to disallowance of interest expense for financial institutions and within the $10 million limit allowed by the Code for the calendar year of issue . SNG31647 LA140-23 Additional provisions of this Bond contained on the reverse hereof have the same effect as though fully set forth in this place. This Bond is not valid or obligatory for any purpose or entitled to any security or benefit under the Resolution until the Certificate of Authentication hereon has been executed by the Bond Registrar by manual signature of one of its authorized representatives. IN WITNESS WHEREOF, the City of Lino Lakes, Anoka County, Minnesota, by its City Council, has caused this Bond to be executed on its behalf by the facsimile signatures of the Mayor and City Clerk -Treasurer and has caused this Bond to be dated as of the date set forth below. Dated: CITY OF LINO LAKES, MINNESOTA (Facsimile) (Facsimile) City Clerk -Treasurer 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 $1,060,000 all of like original issue date and tenor, except as to number, maturity date, redemp- tion privilege, and interest rate, all issued pursuant to a resolution adopted by the City Council on March 23, 1992 (the Resolution), for the purpose of providing money to aid in financing various improvements to the water system of the City, pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Section 444.075 and the City's home rule charter 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 ad valorem taxes on all taxable property in the City in the event of any deficiency in net revenues 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 ._ system free from competition by other like utilities; that adequate insurance on said plant and system and suitable fidelity bonds on employees will be carried; that proper and adequate books of account will be kept showing all receipts and SNG31647 LN140-23 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, Series 1992B 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 thereon when due; and that it will provide, by ad valorem tax levies, for any deficiency in required net water 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 name 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 and the City's home rule charter 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 _'onstitutional, statutory or charter 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 opinion rendered by bond counsel on the issue of Bonds of the City of Lino Lakes, Minne- sota, which includes the within Bond, dated as of the date of delivery of and payment for the Bonds. (Facsimile Signature) City Clerk -Treasurer 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: 3PG31647 1.1140-23 TEN COM -- as tenants UNIF GIFT MIN ACT Custodian -.- in common (Cust) (Minor) TEN ENT - JT TEN -- - as tenants under Uniform Gifts or by entireties Transfers to Minors 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: Notice: The assignor's signature to this assignment must correspond with the name as it appears upon the face of the within Bond in every particular, without alteration or any change whatever. Signature Guaranteed: Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm having a membership in one of the major stock exchanges. The Bond Registrar will not effect transfer of this Bond unless the information 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 City Clerk -Treasurer shall obtain a copy of the proposed approving legal opinion of Holmes & Graven, Chartered, Minneapolis, Minnesota, which shall be complete except as to dating thereof and shall cause the opinion to be printed on 8NG31647 LN140-23 each Bond, together with a certificate to be signed by the facsimile signature of the Clerk -Treasurer in substantially the form set forth in the form of Bond. The Clerk - Treasurer 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 will create and continue to operate its Water Fund to which will be credited all gross revenues of the water system and out of which will be paid all normal and reasonable expenses of current operations of the water system. Any balance therein are deemed net revenues and will be transferred, from time to time, to a General Obligation Water Revenue Bonds, Series 1992B Debt Service Fund (Debt Service Fund) hereby created in the Water Fund, which fund will be used only to pay principal of and interest on the Bonds and any other bonds similarly authorized. There will always be retained in the Debt Service Fund a sufficient amount to pay principal of and interest on all the Bonds, and the Clerk -Treasurer must report any current or anticipated deficiency in the Debt Service Fund to the City Council. There is appropriated to the Debt Service Fund all capitalized interest financed from Bond proceeds, if any, any amount over the minimum purchase price of the Bonds paid by the Purchaser and all accrued interest paid by the Purchaser upon closing and delivery of the Bonds. 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 public utilities and conveniences 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 those accounts except for a duly authorized purpose and in accordance with this resolution. (b) The City will also maintain 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 revenues from the water system in sums sufficient to pay 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 bond holder, or the holder's 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 will be audited at least annually 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 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. 8N031647 LN140-23 (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 plants, 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 law. (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 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 determined that the estimated collection of net revenues for the payment of principal and interest on the Bonds will produce at least five percent in excess of the amount needed to meet, when due, the principal and interest payments on the Bonds and that no tax levy is needed at this time. 4.04. The City Clerk -Treasurer is authorized and directed to file a certified copy of this resolution with the County Auditor and to obtain the certificate required by Minnesota Statutes, Section 475.63. Section 5. Authentication of Transcript. 5.01. The officers of the City are 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 certificates, 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 and City Clerk -Treasurer are authorized and directed to certify that they have examined the Official Statement prepared and circulated in connection with the issuance and sale of the Bonds and that to the best of their knowledge and belief the Official Statement is a complete and accurate representation of the facts and representations made therein as of the date of the Official Statement. Section 6. Tax Covenant . 6.01. 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 to 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 SNG31647 LA140-23 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. 6.02. The City shall comply with requirements necessary under the Code to establish and maintain the exclusion from gross income of the interest on the Bonds under Section 103 of the Code, 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 investment earnings to the United States to the extent required. 6.03. 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. 6.04. In order to qualify the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Code, the City 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 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 1992 will not exceed $10,000,000; and (d) not more than $10,000,000 of obligations issued by the City during calendar year 1992 have been designated for purposes of Section 265(b)(3) of the Code. 6.05. The City will use its best efforts to comply with any federal procedural requirements which may apply in order to effectuate the designations made by this section. The motion for the adoption of the foregoing resolution was duly seconded by Member Elliott , and upon vote being taken thereon, the following voted in favor thereof: Elliott, Kuether, Neal and the following voted against the same: None whereupon said resolution was declared duly passed and adopted. 8NG31647 LN130-23 STATE OF MINNESOTA ) ) COUNTY OF ANOKA ) SS. ) CITY OF LINO LAKES ) I, the undersigned, being the duly qualified and acting Clerk -Treasurer of the City of Lino Lakes, Anoka County, Minnesota, do hereby certify that I have carefully compared the attached and foregoing extract of minutes of a regular meeting of the City Council of the City held on March 23, 1992 with the original minutes on file in my office and the extract is a full, true and correct copy of the minutes insofar as they relate to the issuance and sale of $1,060,000 General Obligation Water Revenue Bonds, Series 1992B of the City. WITNESS My hand officially as such Clerk -Treasurer and the corporate seal of the City this day of March (SEAL) 8NG31647 LN140-23 , 1992. City Clerk -Treasurer Lino Lakes, Minnesota STATE OF MINNESOTA ) COUNTY OF ANOKA ) SS. CITY OF LINO LAKES ) I, the undersigned, being the duly qualified and acting Clerk -Treasurer of the City of Lino Lakes, Anoka County, Minnesota, do hereby certify that I have carefully compared the attached and foregoing extract of minutes of a regular meeting of the City Council of the City held on March 23, 1992 with the original minutes on file in my office and the extract is a full, true and correct copy of the minutes insofar as they relate to the issuance and sale of $1,060,000 General Obligation Water Revenue Bonds, Series 1992B of the City. WITNESS My hand officially as such Clerk -Treasurer and the corporate seal of the City this .Z' "qday of march , 1992. (SEAL) SNG31647 LN140-23 ZetA,t_ ( City Clerk -Treasurer Lino Lakes, Minnesota