10-10454rExtract of Minutes of Meeting
of the City Council of the City of
Richfield, Hennepin County, Minnesota
Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Richfield,
Minnesota, was duly held in the City Hall in said City on Tuesday, December 14, 2010, commencing at
7:00 P.M.
The following members were present:
and the following were absent:
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 General Obligation Tax Increment Refunding Bonds,
Series 2010B, proposed to be issued in the original aggregate principal amount of $6,355,000.
The City Manager presented a tabulation of the proposals which had been received in the manner
specified in the Terms of Proposal for the Bonds. The proposals were as set forth in EXHIBIT A attached.
After due consideration of the proposals, Member
then introduced the
following written resolution, the reading of which was dispensed with by unanimous consent, and moved its
adoption:
RESOLUTION N0.10454
A RESOLUTION AWARDING THE SALE OF GENERAL
OBLIGATION TAX INCREMENT REFUNDING BONDS, SERIES
2010B, IN THE ORIGINAL AGGREGATE PRINCIl'AL AMOUNT
OF $6,355,000; FIXING THEIR FORM AND SPECIFICATIONS;
DIRECTING THEIIZ EXECUTION AND DELIVERY; PROVIDING
FOR THEIR PAYMENT; PROVIDING FOR THE ESCROWING
AND INVESTMENT OF THE PROCEEDS THEREOF; AND
PROVIDING FOR THE REDEMPTION OF BONDS REFUNDED
THEREBY
BE IT RESOLVED By the City Council of the City of Richfield, Hennepin County, Minnesota
(the "City") as follows:
Section 1. Findings• Sale of Bonds.
1.01. Findings. It is hereby determined that:
(a) The City and the Housing and Redevelopment Authority in and for the City of Richfield
(the "Authority") have duly established the Interchange West and Lyndale Gateway Tax Increment
District (the "TIF District") within the Richfield Redevelopment Project Area (the "Project Area")
pursuant to Minnesota Statutes, Sections 469.001 to 469.047, as amended and Sections 469.174 to
469.1799, as amended (collectively, the "TIF Act").
(b) Pursuant to Section 469.178 of the TIF Act and Minnesota Statutes, Chapter 475, as
amended (the "Municipal Debt Act"), the City previously agreed to finance certain public redevelopment
costs to be incurred by the Authority or the City in the Project Area through the issuance of the City's
General Obligation Tax Increment Bonds, Series 2001A (the "Prior Bonds"), dated April 1, 2001, in the
original aggregate principal amount of $8,350,000.
(c) The City is authorized by Section 475.67, Subdivision 13, of the Municipal Debt Act to
issue and sell its general obligation bonds to refund outstanding bonds when determined by the City
Council to be necessary and desirable.
(d) The City finds it necessary and desirable to issue its General Obligation Tax Increment
Refunding Bonds, Series 2010B (the "Bonds"), in the original aggregate principal amount of $6,355,000,
to refund in advance of maturity and at their redemption date the Prior Bonds, currently outstanding in the
aggregate principal amount of $6,610,000, of which $6,275,000 in principal amount will be callable on
August 1, 2011.
(e) Proceeds of the Bonds are expected to be expended as follows:
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Project Designation & Description Total Project Cost
Deposit to Escrow Fund $6,362,997.19
Deposit to Debt Service Fund 4,790.00
Costs of Issuance 52,175.00
Underwriter's Compensation 60,181.01
Total $6.480,143.20*
* Includes par amount of $6, 355, 000.00, plus an original issue premium of $125,143.20.
(f) The City is authorized by Section 475.60, Subdivision 2(9) of the Municipal Debt Act to
negotiate the sale of the Bonds, it being determined that the City has retained an independent financial
advisor in connection with such sale. The actions of the City staff and financial advisors in negotiating
the sale of the Bonds are ratified and confirmed in all aspects.
1.02. Award to the Purchaser and Interest Rates. The proposal of United Bankers' Bank,
Bloomington, Minnesota (the "Purchaser") to purchase the Bonds of the City is determined to be a reasonable
offer and is accepted, the proposal being to purchase the Bonds price of $6,419,962.19 (par amount of
$6,355,000.00, plus original issue premium of $125,143.20, less underwriter's discount of $60,181.01),
plus accrued interest to date of delivery, if any, for Bonds bearing interest as follows:
Year Interest Rate
Year Interest Rate
2012 0.500% 2018 2.450%
2013 0.750 2019 2.800
2014 1.000 2020 3.050
2015 1.400 2021 3.250
2016 1.700 2022 3.400
2017 2.100 2024* 4.500
* Term Bond
True interest cost: 2.9842%
1.03. Purchase Contract. The sum of $115,802.19, being the amount proposed by the Purchaser
in excess of $6,304,160.00, shall be credited to the Debt Service Fund hereinafter created or the Escrow
Fund hereinafter created unless the funds are determined to be deposited in another fund by action of the
City's Finance Manager in consultation with the City's financial advisor. The Finance Manager of the
City is directed to deposit 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 proposers forthwith. The Mayor and City
Manager are directed to execute a contract with the Purchaser on behalf of the City.
1.04. Terms and Principal Amount of Bonds. The City will forthwith issue and sell the Bonds
pursuant to the Municipal Debt Act in the original aggregate principal amount of $6,355,000, originally dated
December 30, 2010, in the denomination of $5,000 each or any integral multiple thereof, numbered No. R-1,
upward, bearing interest as above set forth, and maturing serially on February 1 in the years and amounts as
follows:
Year Amount
Year Amount
2012 $ 370,000 2018 $ 480,000
2013 440,000 2019 490,000
2014 445,000 2020 510,000
2015 450,000 2021 525,000
2016 460,000 2022 545,000
2017 470,000 2024* 1,170,000
Term Bond
1.05. Optional Redemption. The City may elect on February 1, 2019, and on any day
thereafter to prepay Bonds due on or after February 1, 2020. Redemption may be in whole or in part and
if in part, at the option of the City and in such manner as the City will determine. If less than all Bonds of
a maturity are called for redemption, the City will notify DTC (as defined in Section 8 hereof) of the
particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each
participant's interest in such maturity to be redeemed and each participant will then select by lot the
beneficial ownership interests in such maturity to be redeemed. Prepayments will be at a price of par plus
accrued interest.
1.06. Term Bonds; Mandatory Redemption. The Bonds maturing on February 1, 2024, shall
hereinafter be referred to collectively as the "Term Bond." The principal amounts of the Term Bond subject
to mandatory sinking fund redemption on any date may be reduced through earlier optional redemptions, with
any partial redemptions of the Term Bond credited against future mandatory sinking fund redemptions of
such Term Bond in such order as the City shall determine. The Term Bond is subject to mandatory sinking
fund redemption and shall be redeemed in part at par plus accrued interest on February 1 of the following
years and in the principal amounts as follows:
Term Bond Maturing February 1, 2024
Year Amount
Year Amount
2023 $570,000
'~` Maturity
Section 2. Registration and Pam.
2024* $600,000
2.01. Registered Form. The Bonds will 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 the Bond will 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 the Bond will be dated as of the
date of original issue. The interest on the Bonds is payable on February 1 and August 1 of each year,
commencing August 1, 2011, to the registered owners of record as of the close of business on the fifteenth
day of the immediately preceding month, whether or not that day is a business day.
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2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating agent and
paying agent (the ``Registrar"). The effect of registration and the rights and duties of the City and the
Registrar with respect thereto are as follows:
(a) Re. ig stet. 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 foam 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 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 that
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 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 the Bond to
the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. The Registrar may impose a charge upon the owner
thereof for a transfer or exchange of Bonds 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 any 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 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 by the Registrar by mailing a copy of the
redemption notice by first class mail (postage prepaid) 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 if 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 Re istrar. The City appoints Wells Fargo Bank, National
Association, Minneapolis, Minnesota, as the initial Registrar. The Mayor and the City 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, the resulting 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 Finance
Manager must transmit to the Registrar moneys sufficient for the payment of all principal and interest then
due.
2.OS. Execution Authentication and Delivery. The Bonds will be prepared under the direction of
the City Manager and executed on behalf of the City by the signatures of the Mayor and the City Manager,
provided that those signatures may be printed, engraved or lithographed facsimiles of the originals. If an
officer whose signature or a facsimile of whose signature appears on the Bonds ceases to be such officer
before the delivery of a Bond, that 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 Registrar. Certificates of authentication on different Bonds
need not be signed by the same representative. The executed certificate of authentication on a Bond is
conclusive evidence that it has been authenticated and delivered under this Resolution. When the Bonds have
been so prepared, executed and authenticated, the City Manager will deliver the same to the Purchaser upon
payment of the purchase 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 EXHIBIT B attached hereto, 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.
Section 3. Form of Bond.
3.01. Execution of the Bonds. The Bonds will be printed or typewritten in substantially the form
attached hereto as EXHIBIT B.
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3.02. Approving Le ag 1 Opinion. The City Manager is authorized and directed to obtain a copy of
the proposed approving legal opinion of Kennedy & Graven, Chartered, Minneapolis, Minnesota, which is to
be complete except as to dating thereof and cause the opinion to be printed on or accompany each Bond.
Section 4. Bonds; Security; Escrow.
4.01. Debt Service Fund. For the convenience and proper administration of the moneys to be
borrowed and repaid on the Bonds, and to provide adequate and specific security for the Purchaser and
holders from time to time of the Bonds, there is hereby created a special fund to be designated the Tax
Increment Refunding Bonds, Series 2010B Debt Service Fund (the "Debt Service Fund") to be administered
and maintained by the Finance Manager as a bookkeeping account separate and apart from all other funds
maintained in the official financial records of the City. The Debt Service Fund will be maintained in the
manner herein specified until all of the Prior Bonds have been paid and until all of the Bonds and the interest
thereon have been fully paid.
To the Debt Service Fund there is hereby pledged and irrevocably appropriated and there will be
credited: (i) any balance remitted to the City upon the termination of the Escrow Agreement (as defined
herein); (ii) the tax increment revenues resulting from increases in taxable valuation of real property in the
TIF District (the "Tax Increment Revenues") pledged to the payment of the Bonds and interest thereon
pursuant to the Pledge Agreement (as defined herein); (iii) all investment earnings on funds in the Debt
Service Fund; and (iv) any and all other moneys which are properly available and are appropriated by the
City Council to the Debt Service Fund. The amount of any surplus remaining in the Debt Service Fund when
the Bonds and interest thereon are paid will be used as provided in Section 475.61, Subdivision 4 of the
Municipal Debt Act.
There is hereby appropriated to the Debt Service Fund (i) any amount over the minimum purchase
price paid by the Purchaser, to the extent designated for deposit in the Debt Service Fund in accordance with
Section 1.03; and (ii) the accrued interest paid by the Purchaser upon closing and delivery of the Bonds, if
any. If a payment of principal or interest on the Bonds becomes due when there is not sufficient money in the
Debt Service Fund to pay the same, the Finance Manager will pay such principal or interest from the general
fund of the City, and the general fund will be reimbursed for those advances out of the proceeds of the Tax
Increment Revenues when received. The debt service fund heretofore established for the Prior Bonds
pursuant to the resolution authorizing the sale and issuance of the Prior Bonds (the "Prior Bonds Resolution")
shall be terminated on August 1, 2011, following the redemption of the Prior Bonds, and all monies therein
are hereby transferred to the Debt Service Fund herein created.
4.02. Escrow Fund. A portion of the proceeds of the Bonds in the amount of $6,362,997.19 will
be deposited in a separate fund (the "Escrow Fund") maintained by Wells Fargo Bank, National Association,
in Minneapolis, Minnesota, acting as escrow agent (the "Escrow Agent"). Such funds will be received by the
Escrow Agent and applied to fund the Escrow Fund or to pay costs of issuing the Bonds. Proceeds of the
Bonds not used to pay costs of issuance on the Bonds are hereby irrevocably pledged and appropriated to the
Escrow Fund, together with all investment earnings thereon. The Escrow Fund will be invested in securities
maturing or callable at the option of the holder on such dates and bearing interest at such rates as will be
required to provide sufficient funds, together with any cash or other funds retained in the Escrow Fund to
(i) pay when due the interest to accrue on the Bonds to and including August 1, 2011 (the "Redemption
Date"); and (ii) pay on the Redemption Date the principal amount of the Prior Bonds then outstanding. The
Escrow Fund will be irrevocably appropriated to the payment of the principal of and interest on the Prior
Bonds until the proceeds of the Bonds therein are applied to prepayment of the Prior Bonds. The moneys in
the Escrow Fund will be used solely for the purposes herein set forth and for no other purpose, except that
any surplus in the Escrow Fund may be remitted to the City, all in accordance with the Escrow Agreement by
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and between the City and the Escrow Agent. Any moneys remitted to the City upon termination of the
Escrow Agreement will be deposited in the Debt Service Fund.
4.03. Pledge Agreement. A Tax Increment Pledge Agreement between the City and the
Authority, dated on or after December 1, 2010 (the "TIF Pledge Agreement"), is hereby approved and
shall be executed in substantially the form on file with the City, with such additions, deletions, and other
changes as are approved by the City Manager. The TIF Pledge Agreement is to be executed and
delivered in order to satisfy the requirements of Section 469.178, subdivision 2 of the TIF Act and
Section 475.58, subdivision 1, and Section 475.61, subdivision 1, of the Municipal Debt Act. The TIF
Pledge Agreement creates rights in the City and the Authority but is not intended to create duties or
obligations of the City or the Authority to any other persons (including the beneficial or registered owners
of the Bonds) with respect to the Tax Increment Revenues or other revenues described or referenced in
the TIF Pledge Agreement, except to the extent required by applicable law, and is not intended to create
rights in or claims by any other persons (including the beneficial or registered owners of the Bonds) with
respect to the Tax Increment Revenues or other revenues described or referenced in the TIF Pledge
Agreement, except to the extent required by applicable law.
4.04. Findings. It is hereby found and determined that based upon information presently available
from the City's financial advisors, the issuance of the Bonds will result in a reduction of debt service cost to
the City on the Prior Bonds, such that the present value of such debt service or interest cost savings
(the "Reduction") is at least 3.00% of the debt service on the Prior Bonds. The Reduction, after the inclusion
of all authorized expenses of refunding in the computation of the effective interest rate on the Bonds, is
adequate to authorize the issuance of the Bonds as provided by Section 475.67, Subdivisions 12 and 13 of the
Municipal Debt Act.
4.05. No Tax Levy Required. It is determined that the estimated collection of Tax Increment
Revenues for 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.
4.06. Filing of Resolution. The City Manager is authorized and directed to file a certified copy of
this resolution with the Taxpayer Services Division Manager of Hennepin County and to obtain the certificate
required by Section 475.63 of the Municipal Debt Act.
Section 5. Refundin • Fg indings• Redemption of Prior Bonds.
5.01. Purpose of Refunding. The Prior Bonds are the City's General Obligation Tax Increment
Bonds, Series 2001A, dated April 1, 2001, and issued in the original aggregate principal amount of
$8,350,000. The 2012 through 2024 maturities of the Prior Bonds will be called for redemption on
August 1, 2011 in the amount of $6,275,000. It is hereby found and determined that based upon
information presently available from the City's financial advisor, the issuance of the Bonds, a portion of
which will be used to redeem and prepay the Prior Bonds, is consistent with covenants made with the
holders of the Prior Bonds.
5.02. Proceeds Pledged to the Escrow Fund. As of the date of delivery of and payment for the
Bonds, proceeds of the Bonds in the amount of $6,362,997.19 are hereby pledged and appropriated and will
be deposited in the Escrow Fund for the purposes of redeeming the Prior Bonds on August 1, 2011, and
paying interest on the Bonds through August 1, 2011.
5.03. Notice of Redemption. The Prior Bonds maturing on February 1, 2012, and thereafter will
be redeemed and prepaid on the Redemption Date in accordance with their terms and in accordance with the
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terms and conditions set forth in the form of Notice of Call for Redemption attached hereto as EXHIBIT C,
which terms and conditions are hereby approved and incorporated herein by reference. The Registrar for the
Prior Bonds is authorized and directed to send a copy of the Notice of Redemption to each registered holder
of the Prior Bonds.
5.04. Escrow Agreement. On or prior to the delivery of the Bonds, the Mayor and the City
Manager are hereby authorized and directed to execute on behalf of the City an escrow agreement
(the "Escrow Agreement") with the Escrow Agent in substantially the form now on file with the City
Manager. All essential terms and conditions of the Escrow Agreement including payment by the City of
reasonable charges for the services of the Escrow Agent, are hereby approved and adopted and made a part of
this resolution, and the City covenants that it will promptly enforce all provisions thereof in the event of
default thereunder by the Escrow Agent.
Section 6. Authentication of Transcript.
6.01. City Proceedings and Records. 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, may be deemed
representations of the City as to the facts stated therein.
6.02. Certification as to Official Statement. The Mayor, City Manager, and Finance Manager are
hereby 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.
6.03. Other Certificates. The Mayor and City Manager are hereby authorized and directed to
furnish to the Purchaser at the closing such certificates as are required as a condition of sale. Unless
litigation shall have been commenced and be pending questioning the Bonds or the organization of the
City or incumbency of its officers, at the closing the Mayor and the City Manager shall also execute and
deliver to the Purchaser a suitable certificate as to absence of material litigation, and the City Manager
shall also execute and deliver a certificate as to payment for and delivery of the Bonds.
6.04. PaXment of Costs of Issuance. The City authorizes the Purchaser to forward the amount
of Bond proceeds allocable to the payment of issuance expenses (other than amounts payable to
Kennedy & Graven, Chartered, as Bond Counsel) to KleinBank, Chaska, Minnesota on the closing date
for further distribution as directed by the City's financial advisor, Ehlers & Associates, Inc.
Section 7. Tax Covenants.
7.01. Tax-Exempt Bonds. 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 action
v~~ithin 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.
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7.02. Not Private Activi _ Bonds. 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.
7.03. Qualified Tax-Exempt Obli atg ions. 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 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) which will be issued by the City (and all subordinate entities of the City) during
calendar year 2010 will not exceed $30,000,000; and
(d) not more than $30,000,000 of obligations issued by the City during calendar year
2010 have been designated for purposes of Section 265(b)(3) ofthe Code.
7.04. Procedural Requirements. 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.
Section 8. Book-Entr~System; Limited Obligation of City.
8.01. The Depository Trust Company. The Bonds will be initially issued in the form of a
separate single typewritten or printed fully registered Bond'for each of the maturities set forth in Section 1.04
hereof. Upon initial issuance, the ownership of each such Bond will be registered in the registration books
kept by the Registrar in the name of Cede & Co., as nominee for The Depository Trust Company, New York,
New York, and its successors and assigns ("DTC"). Except as provided in this section, all of the outstanding
Bonds will be registered in the registration books kept by the Registrar in the name of Cede & Co., as
nominee of DTC.
8.02. Participants. With respect to Bonds registered in the registration books kept by the Registrar
in the name of Cede & Co., as nominee of DTC, the City, the Registrar and the Paying Agent will have no
responsibility or obligation to any broker dealers, banks and other financial institutions from time to time for
which DTC holds Bonds as securities depository (the "Participants") or to any other person on behalf of
which a Participant holds an interest in the Bonds, including but not limited to any responsibility or obligation
with respect to (i) the accuracy of the records of DTC, Cede & Co. or any Participant with respect to any
ownership interest in the Bonds, (ii) the delivery to any Participant or any other person (other than a
registered owner of Bonds, as shown by the registration books kept by the Registrar), of any notice with
respect to the Bonds, including any notice of redemption, or (iii) the payment to any Participant or any other
person, other than a registered owner of Bonds, of any amount with respect to principal of, premium, if any,
or interest on the Bonds. The City, the Registrar and the Paying Agent may treat and consider the person in
whose name each Bond is registered in the registration books kept by the Registrar as the holder and absolute
owner of such Bond for the purpose of payment of principal, premium and interest with respect to such Bond,
for the purpose of registering transfers with respect to such Bonds, and for all other purposes. The Paying
Agent will pay all principal of, premium, if any, and interest on the Bonds only to or on the order of the
respective registered owners, as shown in the registration books kept by the Registrar, and all such payments
will be valid and effectual to fully satisfy and discharge the City's obligations with respect to payment of
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principal of, premium, if any, or interest on the Bonds to the extent of the sum or sums so paid. No person
other than a registered owner of Bonds, as shown in the registration books kept by the Registrar, will receive
a certificated Bond evidencing the obligation of this resolution. Upon delivery by DTC to the City Manager
of a written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co.,
the words "Cede & Co." will refer to such new nominee of DTC; and upon receipt of such a notice, the City
Manager will promptly deliver a copy of the same to the Registrar and Paying Agent.
8.03. Representation Letter. The City has heretofore executed and delivered to DTC a Blanket
Issuer Letter of Representations (the "Representation Letter") which shall govern payment of principal of,
premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any Paying Agent or
Registrar subsequently appointed by the City with respect to the Bonds will agree to take all action necessary
for all representations of the City in the Representation Letter with respect to the Registrar and Paying Agent,
respectively, to be complied with at all times.
8.04. Transfers Outside Book-Entry System. In the event the City, by resolution of the City
Council, determines that it is in the best interests of the persons having beneficial interests in the Bonds that
they be able to obtain Bond certificates, the City will notify DTC, whereupon DTC will notify the
Participants, of the availability through DTC of Bond certificates. In such event the City will issue, transfer
and exchange Bond certificates as requested by DTC and any other registered owners in accordance with the
provisions of this Resolution. DTC may determine to discontinue providing its services with respect to the
Bonds at any time by giving notice to the City and discharging its responsibilities with respect thereto under
applicable law. In such event, if no successor securities depository is appointed, the City will issue and the
Registrar will authenticate Bond certificates in accordance with this resolution and the provisions hereof will
apply to the transfer, exchange and method of payment thereof.
8.05. Payments to Cede & Co. Notwithstanding any other provision of this Resolution to the
contrary, so long as a Bond is registered in the name of Cede & Co., as nominee of DTC, payments with
respect to principal of, premium, if any, and interest on the Bond and notices with respect to the Bond will be
made and given, respectively in the manner provided in DTC's Operational Arrangements, as set forth in the
Representation Letter.
Section 9. Continuing_Disclosure.
9.01. City Compliance with Provisions of Continuing Disclosure Certificate. The City hereby
covenants and agrees that it will comply with and carry out all of the provisions of the Continuing
Disclosure Certificate. Notwithstanding any other provision of this Resolution, failure of the City to
comply with the Continuing Disclosure Certificate is not to be considered an event of default with respect
to the Bonds; however, any Bondholder may take such actions as may be necessary and appropriate,
including seeking mandate or specific performance by court order, to cause the City to comply with its
obligations under this section.
9.02. Execution of Continuing Disclosure Certificate. "Continuing Disclosure Certificate"
means that certain Continuing Disclosure Certificate executed by the Mayor and City Manager and dated
the date of issuance and delivery of the Bonds, as originally executed and as it may be amended from time
to time in accordance with the terms thereof.
Section 10. Defeasance. When all Bonds and all interest thereon have been discharged as
provided in this section; all pledges, covenants and other rights granted by this resolution to the holders of the
Bonds will cease, except that the pledge of the full faith and credit of the City for the prompt and full
payment of the principal of and interest on the Bonds will remain in full force and effect. The City may
discharge all Bonds which are due on any date by depositing with the Registrar on or before that date a sum
11
sufficient for the payment thereof in full. 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 remainder of this page is intentionally left blank.)
12
The motion for the adoption of the foregoing resolution was duly seconded by Member
and upon vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted.
13
Passed and adopted this 14th day of December, 2010.
CITY OF RICHFIELD, MINNESOTA
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'City Manager
Attest:
~.-~~t1 Vim'
City Clerk
13
EXHIBIT A
PROPOSALS
A-1
BID TABIJLATI~N
$6,455,OD0" General Obligation Tax Increment Refunding Bonds; Series 20106
CITY OF RICHFIELD, MINNESOTA
SALE: Jecernber 14, 2(}1C
RATING: Standard S Po.?rs Credit h~l~rkets'p,A+" BBi: 4.t3o%
NET TRUE
NAME OF BIDDER MATURITY RATE REOFFERING PRICE INTEREST INTEREST
(FelarUary 1) YIELD COST RATE
AWARD:'.~1NITEC) i3ANKER~' BANK
UNIT~CI BANKERS' BANK
Bloomington, t':linnesota
2~~12 0.544% 0.5044ro
2.`x.13 0.750°./0 0.75J°,~a
2 . ~ 714 1.0 Q ' ~' ° . ~ 0 1.0 O F i
2415 i.444°./0 1.404%
201& 1.744°~0 '1.704°fo
2417 2.140 °.•~0 2.1rJ `7°.fo
2018 2.45.0% 2.x54°.~0
2010' 2.840°./0 2.$04%
2+".25 3.fl50°,'0 3.454°!0
2421 3.254°./0 3.2s;G~ro
2';:22 3.a04°,'0 3.404°fo
2423°" 4.540°a 3.004°.~0
2424-• a.544°~0 3.4o4°f°
$6.519.554.00 $1,479,283.19 2.`3821%
NIL P,rAN K~EGAN 2012 3.404°./0
Ivlempl~is. Ten>~essee 23313 3.004°fo
2414 3.4fl41o
2015 3.444°fo
2016 3.444 ;~a
2x17 3.444°,/0
2418 3.444%0
2va19 3.440°./0
202~~ 3.440%
2421 3.750°./0
2422 3.754°./0
2'423 3.75fl°,6
2424 3.750°./0
"4ur,seq~;ent ts~ i~ici czr~ening the issue size decreased t~ $r,35,pGD
Adjusted Price - S6.A1;.!~32. 1:~
Adjusted Net I!7terest Crst - S 1.~16~~, 7 125
Adjusted TkC - 2.GR4i'~<
$5.571,134.60 $'1,536,216.13 3.1151
""? 1,175,~..~i~n Tern-: Bond rue'2C~24 ~•aith ri.~ndatary reden~pticzn n 2023 (Adjusted $1,17B,n001
A-2
X6.455,000 General Obligation Tax Increment Refunding Bonds, Series 20408
City of Richfield, Minnesota
Page 2
NET TRUE
NAME OF BIDDER MATURITY RATE REOFFERING PRICE INTEREST INTEREST
[February 4) YIELD COST RATE
BAIRCI
Agkl~var~ee. '~°, ssconeir~
STERNE, A ~"~E & LEACH, INC.
Birmiziel~am. Alabart7a
INCAFI'AL
Chicago, Illino'a
2012
2013
2014
2015
201 sa
217
2C' 18
2u1~
2020
2021
2022
2023
2024
2012
2313
2514
2015
2010
2017
2,:~ 18
2019
2320
2021
2022
'1423
2024
2.000°'0
2.000°.~0
3.L8o°`o
3.oD0~'O
.t.. "+l i~'.~. aj°
3.000 °!o
3.Oo~0%
3.OOG%
3.125%
3.50v`~0
3.500~fo
3.750°l0
3.75J°.~o
2.030°~
2.333•°>0
2.250°l0
2.5013°%0
2.750°~0
3.OOO°!o
3.250' o
3.250''0
3.400"0
3.50040
3.6oo°fo
3.62540
2.000%
2_COO°.~o
2.000°/0
3.OOO°I°
3.000°0
4.00040
4.393°~°
4.:1;": v
4.u00°/°
4.oUJ°.f°
4.511^'~40
$6,5Q2.05'1.60 $'1,568,87253 3.2821°io
$6.414.352.35 $1,599,837.34 3.2903°d
2012
2013
2vid
2015
2016
2v 17
2Q 18
2C~ 1:1
2020
2G21
2022
2023
2024
A-3
$6.631.586.50 $'1,657,1:73.52 3.3244%
EXHIBIT B
FORM OF BOND
No. R- UNITED STATES OF AMERICA $
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF RICHFIELD
GENERAL OBLIGATION REFUNDING BOND
SERIES 2010B
Date of
Rate Maturi Original Issue CUSIP
February 1, 20_ December 30, 2010
Registered Owner: Cede & Co.
The City of Richfield, Minnesota, a duly organized and existing municipal corporation in Hennepin
County, Minnesota (the "City"), acknowledges itself to be indebted and for value received promises to pay to
the Registered Owner specified above 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 August 1, 2011, 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 Wells Fargo Bank,
National Association, Minneapolis, Minnesota as 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 irrevocably pledged.
The City may elect on February 1, 2019, and on any day thereafter to prepay Bonds due on or after
February 1, 2020. Redemption may be in whole or in part and if in part, at the option of the City and in such
manner as the City will determine. If less than all Bonds of a maturity are called for redemption, the City will
notify Depository Trust Company ("DTC") of the particular amount of such maturity to be prepaid. DTC
will determine by lot the amount of each participant's interest in such maturity to be redeemed and each
participant will then select by lot the beneficial ownership interests in such maturity to be redeemed.
Prepayments will be at a price of par plus accrued interest.
The Bonds maturing on February 1, 2024, shall hereinafter be referred to collectively as the "Term
Bond." The principal amounts of the Term Bond subject to mandatory sinking fund redemption on any date
may be reduced through earlier optional redemptions, with any partial redemptions of the Term Bond
credited against future mandatory sinking fund redemptions of such Term Bond in such order as the City
shall determine. The Term Bond is subject to mandatory sinking fund redemption and shall be redeemed in
part at par plus accrued interest on February 1 of the following years and in the principal amounts as follows:
B-1
Term Bond Maturing February 1, 2024
Year Amount
Year
Amount
2023 $570,000 2024* $600,000
* Maturity
The City Council has designated the issue of Bonds of which this Bond forms a part as "qualified
tax-exempt obligations" 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
$30 million limit allowed by the Code for the calendar year of issue.
This Bond is one of an issue in the aggregate principal amount of $6,355,000 all of like original issue
date and tenor, except as to number, maturity date, and interest rate, all issued pursuant to a resolution
adopted by the City Council on December 14, 2010 (the "Resolution"), for the purpose of providing money
to refund in advance of maturity on August 1, 2011 (the "Redemption Date") a portion of certain general
obligation bonds of the City, pursuant to and in full conformity with the home rule charter of the City and the
Constitution and laws of the State of Minnesota, including Minnesota Statutes, Chapters 469 and 475, as
amended, and Minnesota Statutes, Section 475.67, Subdivision 13. The interest hereon is payable until the
Redemption Date primarily out of an escrow fund held by an escrow agent and a debt service fund and
thereafter from tax increment revenues resulting from increases in taxable valuation of real property in the
Interchange West and Lyndale Gateway Tax Increment District within the Richfield Redevelopment Project
Area, 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 tax increments 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.
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 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 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 transferor exchange.
The City and the 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 Registrar will 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 home rule charter of the City and 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 constitutional, statutory, or charter limitation of
indebtedness.
B-2
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 Registrar by manual
signature of one of its authorized representatives.
IN WITNESS WHEREOF, the City of Richfield, Hennepin County, Minnesota, by its City Council,
has caused this Bond to be executed on its behalf by the facsimile or manual signatures of the Mayor and City
Manager and has caused this Bond to be dated as of the date set forth below.
Dated: December 30, 2010
CITY OF RICHFIELD, MINNESOTA
Facsimile) (FacsimileZ
Mayor City Manager
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
WELLS FARGO
ASSOCIATION
By
BANK, NATIONAL
Its Authorized Officer
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this Bond, will be
construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by entireties
UNIF GIFT MIN ACT
Custodian
(Cust) (Minor)
under Uniform Gifts or Transfers to Minors
Act, State of
JT TEN -- as joint tenants with right of
survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list.
B-3
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:
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the Securities
Transfer Agent Medallion Program ("STAMP"), the Stock Exchange Medallion Program ("SEMP"), the
New York Stock Exchange, Inc. Medallion Signatures Program ("MSP") or other such "signature guarantee
program" as may be determined by the Registrar in addition to, or in substitution for, STAMP, SEMP or
MSP, all in accordance with the Securities Exchange Act of 1934, as amended.
The 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
B-4
PROVISIONS AS TO REGISTRATION
The ownership of the principal of and interest on the within Bond has been registered on the books of
the Registrar in the name of the person last noted below.
Date of Registration
Registered Owner
Signature of
Officer of Registrar
Cede & Co.
Federal ID #13-2555119
B-5
EXHIBIT C
NOTICE OF CALL FOR REDEMPTION
NOTICE OF CALL FOR REDEMPTION
$8,350,000
GENERAL OBLIGATION TAX INCREMENT BONDS
SERIES 2001A
CITY OF RICHFIELD
HENNEPTN COUNTY, MINNESOTA
NOTICE IS HEREBY GIVEN that, by order of the City Council of the City of Richfield, Hennepin
County, Minnesota (the "City"), there have been called for redemption and prepayment on
August 1, 2011
all outstanding bonds of the City designated as General Obligation Tax Increment Bonds, Series 2001A,
dated April 1, 2001, having stated maturity dates of February 1 in the years 2012 through 2024, both
inclusive, totaling $6,275,000 in principal amount, and with the following CUSIP numbers:
Year of Maturity
2012
2013
2014
2015
2016
2017
2019
2021
2024
Amount
$355,000
370,000
385,000
405,000
425,000
450,000
965,000
1,075,000
1,845,000
763325 F28
763325 F36
763325 F44
763325 F51
763325 F69
763325 F77
763325 F93
763325 G35
763325 G68
The bonds are being called at a price of par plus accrued interest to August 1, 2011, on which date all
interest on said bonds will cease to accrue. Holders of the bonds hereby called for redemption are requested
to present their bonds for payment at the main office of Wells Fargo Bank, National Association (formerly
known as Wells Fargo Bank Mimlesota, National Association), Minneapolis, Minnesota, on or before August
1, 2011.
Wells Fargo Bank, National Association
Attention: Corporate Trust Operations
Sixth Street and Marquette Avenue
MAC 9303-121
Minneapolis, MN 55479
Important Notice: In compliance with the Economic Growth and Tax Relief Reconciliation Act of
2003, the City is required to withhold a specified percentage of the principal amount of the redemption
CUSIP Number
C-1
price payable to the holder of any Bonds subject to redemption and prepayment on the Redemption Date,
unless the City is provided with the Social Security Number or Federal Employer Identification Number
of the holder, properly certified. Submission of a fully executed Request for Taxpayer Identification
Number and Certification, Form W-9 (Rev. October 2007), will satisfy the requirements of this
paragraph.
Dated: December 15, 2010.
BY ORDER OF THE CITY COUNCIL
By /s/ Steven Devich
City Manager
City of Richfield, Minnesota
C-2
STATE OF MINNESOTA CERTIFICATE OF TAXPAYER
SERVICES DNISION MANAGER
COUNTY OF HENNEPIN AS TO REGISTRATION WHERE
NO AD VALOREM TAX LEVY
I, the undersigned Taxpayer Services Division Manager of Hennepin County, Minnesota, hereby
certify that a certified copy of a resolution adopted by the governing body of the City of Richfield, Minnesota
(the "City"), on December 14, 2010, relating to the City's General Obligation Tax Increment Refunding
Bonds, Series 2010B, issued in the aggregate principal amount of $6,355,000 and dated December 30, 2010,
has been filed in my office and said bonds have been entered on the register of obligations in my office.
WITNESS My hand and official seal this day of December, 2010.
Taxpayer Services Division Manager
Hennepin County, Minnesota
(SEAL)
Deputy
RC 145-617 (JAE)
378986v1