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HomeMy WebLinkAboutRES 88-039 RELATING TO $210,000 GENERAL OBLIGATION SEWER REVENUE BONDS OF 1988; AUTHORIZING THE ISSUANCE, AWARDING THE SALE, FIXING THE FORM AND DETAILS, AND PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF AND SECURITY THEREFOR CERT:-77-CATION OF MINUTES Rc.LA.TING 770 $210 , 000 GENER=.L OBLIGATION • SEVER REVEN:'E BONDS OF 1588 Issuer : City of St . =nthony, Minnesota Governing body : City Council Kind, date, time and place of Meeting : A regular meeting held on September 27 , 1988 , at 7 : ,0 o ' clock P.M. , at the City Hall . Members present : Sundland, :Enrooth, Makowske, Marks, Ranallo Members absent : • None Documents attached : Minutes of said meeting (including) : 1 through 19 RESOLUTION 88-039 RESOLUTION RELATING TO $2.10 , 000 GENERAL OBLIGATION SEWER REVENUE BONDS OF 1988 ; AUTHORIZING THE ISSUANCE, AWARDING THE SALE, FIXING THE FORM AND DETAILS, AND PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF AND SECURITY THEREFOR • I , the undersigned, being the duly qualified and acting recording officer of the public corporation issuing the obligations referred to in the title of this certificate, certify that the documents attached hereto , as described above, have been carefully compared with the original records of the corporation in my legal custody, from which they have been transcribed; that the documents are a correct and complete transcript of the minutes of a meeting of the governing body of the corporation, and correct and complete copies of all resolutions and other actions taken and of all documents approved by the governing body at the meeting , insofar as they relate to the obligations and that the meeting was duly held by the governing body at the time and place and was attended throughout by the members indicated above, pursuant to call and notice given as required by law. WITNESS my hand officially as . such recording officer this day of September, 1988 . Co nie J. K -oe_nlir. City Clerk Member Marks introduced the following • resolution and moved its adoption : RESOLUTION 88-039 RESOLUTION RELATING TO $210 , 000 GENERAL OBLIGATION SEWER REVENUE BONDS OF 1988 ; AUTHORIZING THE ISSUANCE, AWARDING THE SALE, FIXING THE FORM AND DETAILS, AND PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF AND SECURITY THEREFOR BE IT RESOLVED by the City Council (the Council) of the City of St . Anthony, Hennepin County, Minnesota (the City) , as follows : Section 1 . Authorization and Sale . 1 . 01 . Cost of Project . The City owns and operates a municipal sewer system (the System) . This Council has heretofore ordered . construction of improvements to the System, (the Improvements) . The present estimated total cost of the Improvements are as follows : Construction $198 , 600 Bond Issuance Costs 7, 284 Bond Discount 4 , 116 • Total $210 , 000 1. 02 . Authorization. To pay the costs of the Improvements this Council has determined that it is necessary and expedient for the City to . issue and sell its General Obligation Sewer Revenue -Bonds of 1988 (the Bonds) in the principal amount of $210 , 00.0 including every item of costs of the kinds authorized in Minnesota Statutes , Section 475 . 65, $4 , 116 of such amount representing interest as provided in Minnesota Statutes, Section 475 . 56 . 1 . 03 . Terms of the Bonds . The Bonds shall be entitled General- Obligation Sewer Revenue Bonds of 1988 , shall be in fully registered form, and shall be dated as of October 1 , 1988 . The Bonds shall mature in the principal amount of $25 , 000 on October 1 in each of the years 1989 and 1990, $30 , 000 on October 1 in each of the years 1991 through 1993 and $35, 000 on October 1 in 1994 and 1995 . Interest on the Bonds is payable- on April 1 and October 1 of each year, commencing April 1, 1989 . The Bonds shall be subject to redemption and prepayment at the option of the City on the terms hereinafter set forth in this Resolution. • 1 . 04 . Award of Sale . This Council has received the • bid of Miller & Schroeder Financial , Inc . , to purchase the Bonds on the terms set forth in Section 1 . 03 and the other terms set forth in this Resolution at the price of $ , plus accrued interest . The offer is reasonable and advantageous to the City and is hereby accepted by the City. The Bonds are sold to Miller & Schroeder Financial , Inc . (the "Purchaser" ) pursuant to the provisions of Minnesota Statutes , Section 475 . 60 , Subdivision 2 (2) . 1 . 05 . Issuance of .Bonds . The City is authorized by Minnesota Statutes , Section 115 . 465 and Chapter 475 to issue and sell the Bonds to pay the costs of the Improvements , and to pledge to the payment of the Bonds net revenues to be derived from charges for the service, use and availability of the System. The City has no obligations outstanding which constitute a lien upon any part of the revenue of the System. All acts, conditions and things which are required by the Constitution and laws of the State of Minnesota to be done, to exist - to happen and to be performed precedent to and in the valid issuance of the Bonds having been done, existing, having happened and having been performed, it is now necessary for this Council to establish the form and terms of the Bonds , to provide security therefor and to issue the Bonds forthwith. • Section 2 . Form of Bonds . The Bonds shall be prepared in substantially the following form: • -2- • [Face of the Bonds] UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTIES OF HENNEPIN AND RAMSEY CITY OF ST . ANTHONY GENERAL OBLIGATION SEWER REVENUE BOND OF 1988 Date of Rate Maturity Original Issue CUSIP October 1 , 1988.- REGISTERED SEE REVERSE FOR OWNER: CERTAIN DEFINITIONS PRINCIPAL DOLLARS AMOUNT: THE CITY OF ST. ANTHONY, Hennepin County, ' Minnesota • (the City) , acknowledges itself to be indebted and, for value received, hereby promises to pay to the registered owner above named, the principal amount indicated above, on the maturity date specified above, with interest thereon from the date hereof at the annual rate specified above, payable on April 1 and October 1 in each year , commencing April 1, 1989 , to the person in whose name this Bond is registered at the close of business on the 15th day (whether or not a business day) of the immediately preceding month, all subject to the provisions referred to herein with respect to the redemption of - the principal of this Bond before maturity. 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 of Marquette Bank Minneapolis , National Association, in Minneapolis , Minnesota, as Bond Registrar, Transfer Agent and Paying Agent (the Bond Registrar) , or its successor designated under the Resolution described herein. Additional provisions 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 hereon. . This Bond shall not be valid or become obligatory for any purpose or be entitled to any security or benefit under the -3- • 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 St . Anthony, Hennepin County, State of Minnesota , by its City Council , has caused this Bond to be executed by the facsimile signatures of the Mayor and the City Manager and by a printed facsimile of the official seal of the City and has caused this Bond to be dated as of the date set forth below. Date of Authentication: (Facsimile Signature) (Facsimile Signature) City Manager Mayor (Facsimile Seal) CERTIFICATE OF AUTHENTICATION This is one of the Bonds delivered pursuant to the Resolution mentioned within. MARQUETTE BANK MINNEAPOLIS, NATIONAL ASSOCIATION, as Trustee By Authorized Representative [Reverse of the Bonds] This Bond is one of an issue in the aggregate principal amount of $210 , 000 (the Bonds) , all of like date and tenor except as to serial number , interest rate, redemption privilege and maturity date issued pursuant to a resolution adopted by the City Council on September 27, 1988 (the Resolution) to finance construction of improvements to the sewer system in the City, and is issued pursuant to and in full conformity with the provisions of the Constitution and laws of the State of Minnesota thereunto enabling , including Minnesota Statutes , Section 115 . 465 and Chapter 475 . The Bonds are issuable only as fully registered bonds , in denominations of $5 , 000 or any integral multiple thereof , of single maturities . Bonds maturing in the years 1989 through 1992 are payable on their respective stated maturity dates without -4- option of prior payment , but Bonds having stated maturity dates • in the years 1993 through 1995 are each subject to redemption and prepayment , at the option of the City and in whole or in part , and if in part , in inverse order of maturities and by lot , assigned in proportion to their principal amount , within any maturity, on October 1 , 1992 and on any interest .payment date thereafter, at a price equal to the principal amount thereof to be redeemed plus interest accrued to the date of redemption. At least thirty days prior to the date set for redemption of any Bond, notice of the call for redemption will be published in a daily or weekly periodical , published in a Minnesota city of the first class or its metropolitan area, which circulates throughout the state and furnishes financial news as a part of its service, and will be mailed to the Bond Registrar and to the registered owner of each Bond to be redeemed at his address appearing in the Bond Register , but no defect in or failure to give such mailed notice of redemption shall affect the validity of proceedings for the redemption of any Bond. Upon the partial redemption of any Bond, a new Bond or Bonds will be delivered to the registered owner without charge, representing the remaining principal amount outstanding . 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 his • 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 his 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 to be done, to exist , to happen and to be performed precedent to and in the issuance of this Bond, have been done, do exist , have happened -5- • and have been performed in regular and due form, time and manner as so required; that in and by the Resolution, the City has covenanted and agreed with the holders of the Bonds that it will impose and collect charges for the service, use and availability of its sewer utility at the times and in amounts required to produce net revenues adequate, to pay all principal of and . interest on the Bonds and on all other bonds payable from net revenues of the sewer utility as such principal and interest respectively become due; that, if needed to pay such principal and interest , ad valorem taxes will be levied upon all taxable property in the City, without limitation as to rate or amount ; and that this Bond, together with all other indebtedness of the City outstanding on the date hereof , and on the date of its actual issuance and delivery, does not exceed any constitutional or -statutory limitation of indebtedness . 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 the applicable laws or regulations : TEN COM -- as tenants . UNIF GIFT MIN ACT. . . . .Custodian. . . . . in common (Cust) (Minor) • TEN ENT -- as tenants by the entireties under Uniform Gifts to JT TEN -- as joint tenants Minors with right of survivorship and Act . . . . . . . . . . . . . . . . . . . . . . not as tenants in (State) common Additional abbreviations may also be used. -6- ASSIGNMENT • FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto the within Bond and all rights thereunder, and hereby irrevocably constitutes and appoints attorney to transfer the within Bond on the books kept for registration thereof , with full power of substitution in the premises .. Dated: PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER NOTICE: The signature to this . OF ASSIGNEE: assignment must correspond with the name as it appears upon the face of the within Bond in every particular , without alteration or any change whatsoever . Signature(s) must be guaranteed by a commercial bank or trust company or by a brokerage firm having a membership in one of the major stock exchanges . Section 3 . Bond Terms , Execution and Delivery. • 3 . 01 . Maturities , Interest Rates , Denominations , Payment . The City shall forthwith 'issue and deliver the Bonds , which shall be denominated -"General Obligation Sewer Revenue Bonds of 1988 . " The Bonds shall be issuable in the denomination of $5 , 000 each or any integral multiple thereof ; shall mature on October 1 in the years and amounts set forth below, and Bonds maturing in such years and amounts shall bear interest from date of issue until paid or duly called for redemption at the rates per annum shown opposite such years and amounts as follows : Year Amount Rate 1989 $25 , 000 1990 25 , 000 1991 30, 000 1992 30 , 000 1993 30, 000 1994 35, 000 1995 35 ,000 The Bonds shall be issuable 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. Each Bond • -7- shall be dated by the Registrar as of the date of its • authentication . 3 . 02 . Dates ; Interest Payment Dates . Interest on the Bonds shall be payable on April 1 and October 1 in each year , commencing April 1 , 1989 , 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. 3 . 03 . Registration. The City shall appoint, and shall maintain, a bond registrar , transfer agent and paying agent ( the Registrar) . The effect of registration and the rights and duties of the City and the Registrar 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 shall 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 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 Bond is 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 duly authorized in writing. (d) Cancellation . All Bonds surrendered upon any transfer or exchange 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 -8- • the endorsement on such Bond or separate instrument of transfer is legally authorized. The Registrar shall incur no liability for its 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 any Bond is at any time registered in the bond register 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 of the City 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 (except for an exchange upon a partial redemption of a Bond) , 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 such transfer or exchange. • (h) Mutilated, Lost , Stolen or Destroyed Bonds . In case any Bond shall become mutilated or be lost , stolen or destroyed, 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 lost , stolen or destroyed, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a Bond lost , stolen or destroyed, upon filing with the Registrar of evidence satisfactory to it that such Bond was lost, stolen or destroyed, 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, lost , stolen or destroyed 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 . ( i ) Authenticating Agent . The Registrar is hereby designated authenticating agent for the Bonds , within the meaning of Minnesota Statutes , Section 475 . 55 , ® subdivision 1 . -9- • 3 . 04 . Appointment of Initial Registrar . The City hereby appoints Marquette Bank Minneapolis , National Association, as the initial Registrar . The Mayor and the City Manager are authorized to execute and deliver, on behalf of the City, a contract with Norwest Bank Minnesota , National Association, as 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 corporation 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 any Registrar upon thirty (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 Registrar . On or before each principal. or interest due date, without further order of this Council , the City Manager shall transmit to the Registrar, moneys sufficient for the payment of all principal and interest then due pursuant to Section 4 . 01 hereof . 3 . 05 . Redemption. Bonds maturing in the years 1989 through 1992 shall not be subject to redemption prior to maturity, but Bonds maturing in the years 1993 through 1995 • shall each be subject to redemption and prepayment, at the option of the City, in whole or in part , and if in part, in inverse order of maturities and, within any maturity, in $5, 000 principal amounts selected by the Registrar by lot, on October 1, 1992 and on any interest payment date thereafter at a price equal to the principal amount thereof to be redeemed plus interest accrued to the date of redemption. . At least thirty days prior to the date set for redemption of any Bond, the City Manager shall cause notice of the call for redemption to be published in a daily or weekly periodical published in a Minnesota city of the first class or its metropolitan area, which circulates throughout the state and furnishes financial news as a part of its service, and to be mailed to the Registrar and to the registered owner of each Bond to be redeemed, but no defect in or failure to give such mailed notice of redemption shall affect the validity of proceedings for the redemption of any Bond not affected by such defect or failure. Upon a partial redemption of any Bond, a new Bond or Bonds will be delivered to the registered owner without charge, representing the remaining principal amount outstanding . 3 . 06 . Preparation and Delivery. The Bonds shall be prepared under the direction of the City Manager and shall be executed on behalf of the City by the signatures of the Mayor and the City Manager , and shall be sealed with the official corporate seal of the City; provided that said signatures and -10- r • the corporate seal may be printed, engraved, or lithographed facsimiles thereof . 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 such 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 authorized representative of the Registrar . Certificates of authentication on different Bonds need not be signed by the same representative. The executed certificate of authentication on each Bond shall be conclusive evidence tha-t it has been authenticated and delivered under this resolution . When the Bonds have been so executed and authenticated, they shall be . delivered by the City Manager 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. Section 4 . Security Provisions . • 4 . 01 . 1988 Sewer Improvement Construction Fund. There is hereby created a special fund to be designated as the "1988 Sewer improvement Construction Fund" (the Construction Fund) , to be held and administered by the City separate and apart from all other funds of the City. The City appropriates to the Construction Fund the proceeds of the sale of the Bonds, less the amount required by Section 4 . 02 'hereof to be deposited in the Bond Fund therein created. The Construction Fund shall be used solely to defray expenses of the construction of the Improvements . Upon completion and payment of all costs of the construction of Improvements , any balance of the proceeds of Bonds remaining in the Construction Fund shall be credited and paid to the Bond Fund. 4 . 02 . 1988 Sewer Improvement Bond Fund . So long as any of the Bonds are outstanding and any principal thereof or interest thereon unpaid, the City shall maintain a separate and special 1988 Sewer Improvement Bond Fund (the Bond Fund) to be used for no purpose other than the payment of the principal of and interest on the Bonds and any additional obligations of the City payable therefrom pursuant to Section 4 . 03 hereof . If the balance in the Bond Fund is ever insufficient to pay all principal and interest then due on bonds payable therefrom, the City shall nevertheless provide sufficient money from any other funds of the City which are available for that purpose, and such other funds shall be reimbursed from subsequent receipts • -11- of net revenues of the System appropriated to the Bond Fund • and, if necessary, from the proceeds of the taxes levied for the Bond Fund . The City hereby appropriates to the Bond Fund the accrued interest on the Bonds and any amount in excess of $205 , 884 bid for the Bonds and received from the Purchaser upon delivery of the Bonds . The City shall deposit in the Bond Fund the proceeds of all taxes levied and all other money which may at any time be received for or appropriated to the payment' of such bonds and interest , including the net revenues of the System herein pledged and appropriated to the Bond Fund, all collections of any ad valorem taxes levied for the payment of the Bonds , and all other moneys received for or appropriated to the payment of the Bonds and interest thereon. 4 . 03 . Imposition of Charges ; Additional .Bonds . The City hereby covenants and agrees with the holders from time to time of the Bonds that so long as any of the Bonds are outstanding, the City will impose and collect reasonable charges for the service, use and availability of the System to the City and its inhabitants according to schedules calculated to produce net revenues which, will be sufficient , together with any ad valorem taxes levied for the payment of the Bonds , to pay all principal and interest when due on the Bonds , and said net revenues , to the extent necessary, are hereby irrevocably pledged and appropriated to the payment of the • Bonds and interest thereon; provided that nothing herein shall preclude the City from hereafter making further pledges and appropriations of net revenues of the System for the payment of additional obligations of the City hereafter authorized if the City Council determines before the authorization of such additional obligations that the estimated net revenues of the System will be sufficient , together with any other sources pledged to or projected to be used, for the payment of the principal of and interest on the Bonds and such .additional obligations . Such further pledges and appropriations of said net revenues may be made superior or subordinate to or on a parity with the pledge and appropriation herein made, as to the application of net revenues received from time to time . 4 . 04 . Full Faith and Credit Pledged; Tax Levy. The full faith and credit of the City shall be and are hereby irrevocably pledged for the prompt and full payment of the principal of and interest on the Bonds and any other obligations payable from the Bond Fund, as such principal and interest comes due, and the City covenants and agrees that it will make good any deficiency in the Bond -Fund from the general fund of the City. On or before October 1 of each year, beginning in the year 1989 , the City Finance Officer will calculate the total amount of cash on hand in the Bond Fund and the available net • -12- • revenues of the System on hand and estimated to be received on or before the first day of January next following and the proceeds of the ad valorem tax levy to be received on or before the first day of January next following , and shall determine the sufficiency of such total amount for the payment of principal of and interest on the Bonds coming due on or prior such first day of January. If such total amount is determined to be insufficient for such payment , this Council shall forthwith appropriate to the Bond Fund sufficient available moneys of the City to make good the insufficiency, and if available moneys of the City are not on hand in amounts sufficient for this purpose, this Council shall forthwith levy and certify to the Hennepin and Ramsey County Auditors for collection- in the - following--year a tax at least five percent ( 5%) in excess of the amounts adequate to make good the insufficiency. The City Finance Director shall also at the same time estimate the amount which will be on hand in the Bond Fund after payment of principal and interest payable on the Bonds on or prior the first day of January next following , and the amount of net revenues of the System and the proceeds of the ad valorem tax levy to be received in the period of 12 months beginning on the first day of January next following and shall determine the sufficiency of such estimated amounts for the payment of the principal of • and interest on the Bonds coming due during and immediately at the end of such 12-month period. If such amount is determined to be insufficient for such payment, this Council shall forthwith cause to be levied and certified to the Hennepin and Ramsey County Auditors for collection in the following year a tax at least five percent (5%) in excess of amounts adequate to make good the insufficiency. Section 5 . Defeasance . When all of the Bonds have been discharged as provided in this Section 5, all pledges , covenants and other rights granted by this resolution to the holders of the Bonds shall cease. The City may discharge its obligations with respect to any Bonds which are due on any date by irrevocably depositing with the Registrar on or before that date a sum sufficient for the payment thereof in full ; or, if any Bond should not be paid when due, it may nevertheless be discharged by depositing with the Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit . The City may also at any time discharge its obligations with respect to any Bonds , subject to the provisions of law now or hereafter authorizing and regulating such action, by depositing irrevocably in escrow, with a bank qualified by law as an escrow agent for this purpose, cash or securities which are • general obligations of the United States or securities of -13- • United States agencies which are authorized by law to be so deposited , bearing interest payable at such time and at such rates and maturing on such dates as shall be required, without reinvestment , to pay all principal and interest to become due thereon to maturity. Section 5 . County Auditor Registration, Certification of Proceedings , Investment of Moneys , Arbitrage, Official Statement and Fees . 5 . 01 . County Auditor Registration . The City Manager is hereby authorized and directed to file a certified copy of "pis resolution with the County Auditor of Hennepin County and the County Auditor of Ramsey County, together with such other information as the County Auditor shall require, and to obtain from said County Auditor a certificate that the Bonds have been entered on his bond register as required by law. 5 . 02 . Certification of Proceedings . The officers of the City and the County Auditor of Hennepin County are hereby authorized and directed to prepare and furnish to the purchaser of the Bonds and to Dorsey & Whitney, Bond Counsel , certified copies of all proceedings and records of the City, and such other affidavits , certificates and information as may be required to show the facts relating to the legality and • marketability of the Bonds as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies , certificates and affidavits , including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein . 5 . 03 . Covenants . 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 (the Regulations) , as such are enacted or promulgated and in effect on the date of issue of the Bonds, and covenants to take any and all actions within its powers to ensure that the interest on the Bonds will not become subject to taxation under the Code and the Regulations . For purposes of complying with the requirements of Section 148(f) (4) (C) of the Code relating to the exemption of certain small governmental units from the rebate requirements of the Code, the City represents that : ( i) the City is a governmental unit with general taxing powers ; -14- ( ii) the Bonds are not "private .activity bonds" as defined in Section 141 of the Code (Private Activity Bonds) ; (iii) ninety-five percent of the net proceeds of the Bonds are to be used for the local governmental purposes of the City; and ( iv) the aggregate face amount of all tax-exempt bonds (other than Private Activity Bonds) issued by the City in calendar- year in which the Bonds are to be issued is not reasonably expected to exceed $5 , 000 , 000 . 5 . 04 . Arbitrage Certification. The- Mayor and City Manager, being the officers of the City charged with the responsibility for issuing the Bonds pursuant to this resolution, are authorized and directed to execute and deliver to the purchaser thereof a certificate in accordance with the provisions of Section 148 of the Code, and Sections 1 . 103-13 , 1 . 103-14 and 1 . 103-15 of the Regulations , stating the facts, estimates and circumstances in existence on the date of issue and delivery of the Bonds which make it reasonable to expect that the proceeds of the Bonds will not be used in a manner that would cause the Bonds to be arbitrage bonds within the • meaning of the Code and Regulations . 5 . 05 . Interest Disallowance. The City hereby designates the Bonds as "qualified tax-exempt obligations" for purpose of Section 265 (b) of the Code relating to the disallowance of interest expenses for financial institutions . The City represents that in calendar year 1988 it does not reasonably- expect to issue tax-exempt obligations which are not private activity bonds (not treating qualified 501(c) (3) bonds under Section 145 of the Code as private activity bonds for purposes of this representation) in an amount in excess of $10 , 000, 000 . 2 ayor Attest : Ci Clerk �1 r' ri `,` -15- The motion for the adoption of the foregoing • resolution was duly seconded by Member Fnrnn h and upon vote being taken thereon, the following voted in favor thereof : Marks, Enrooth, Sundland, Makowske, Ranallo and the following voted against the same: None whereupon said. resolution was declared duly passed and adopted, and was signed by the Mayor , whose signature was attested by the City Clerk. • -16-