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Debt Issuance Servicuag Series 2006A and the 2014 through 2023 maturities of the G.O. Improvement bonds, Series 2007A (the "Prior Bonds"). Interest rates on the 2003 11RA Public Facilities Lease Revenue Bonds proposed to be refunded are 3.10% to 4.15%. The refunding is expected to reduce interest expense by approximately $555,371 over the next 11 years (average of $50,000/year). The Net Present Value Benefit of the refunding is estimated to be $510,497, equal to 13.174% of the refunded principal. The HRA will be utilizing the existing Debt Service Reserve Fund ($437,430) held in escrow to buy down the bonds. Interest rates on the 2006A G.O. Improvement Bonds proposed to be refunded are 4.0%. The refunding is expected to reduce interest expense by approximately $211.602 over the next 9 years (average of $24,000/year). The Net Present Value Benefit of the refunding is estimated to be $194,344, equal to 10.283% of the refunded principal. Interest rates on the 2007A G.O. Improvement Bonds proposed to be refunded are 3.65% to 4.10%. The refunding is expected to reduce interest expense by approximately $125,372 over the next 10 years (average of $14,000/year). The Net Present Value Benefit of the refunding is estimated to be $113,477, equal to 8.223% of the refunded principal. An advance refunding means the proceeds ol'the new 2012A Bonds will be escrowed in an amount sufficient to pay principal and interest Oil the Prior 13011ds through the call dates of 2/1/2013 and 2/1/2014 respectively. Bonds can only be advance refunded once during the life of the issue. 'file City's goal is to have the present value savings be at least 3% of the outstanding Prior Bonds. Term/Call Feature 'file Bonds are being issued I'or a 15 year term. Principal on the Bonds will be due on February I in IIIc years 2013 through 2028. The Bonds maturing February 1, 20217 and thereafter will be subject to prepayment at the discretion of the City on February 1, 2020 or any date thereafter. Bank Qualification Because the City is issuing less than $10,000,000 in the calendar year, the City will be able to designate the Bonds as "bank qualified" obligations. Bank qualified status broadens the market for the Bonds, which can result in lower interest rates. Rating, The City's most recent bond issues were rated AA by Standard & Door's. The City will request a new rating for the Bonds. If the winning bidder on the Bonds elects to purchase bond insurance, the rating Por the issue may be higher than the City's bond rating in the event that the bond rating of the insurer is higher than that of the C i ty. `m Presale Report City of St. Anthony, Minnesota February 28, 2012 Page 2