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HomeMy WebLinkAbout02-085 t CITY OF LAKEVILLE RESOLUTION Date :April 15, 2002 Resolution No, 02-85 Motion By sellows Seconded By Mulvihill A RESOLUTION AWARDING THE SALE OF $220,144 GENERAL OBLIGATION CAPITAL NOTE, SERIES 2002; FIXING ITS FORM AND SPECIFICATIONS; DIRECTING ITS EXECUTION AND DELIVERY; AND PROVIDIlVG FOR ITS PAYMENT BE IT RESOLVED By the City Council of the City of Lakeville, Dakota County, Minnesota (City) as follows: Section 1. Sale of Note. 1.01. (a) By Resolution. No. 02-37 the City has accepted the .offer of the League of Minnesota Cities Insurance Trust (Purchaser) to purchase certificates ofindebtedness (herein, Note) of the City to be issued and sold under the authority granted by Minnesota Statutes, section 412.301 (Act) for the purchase of bleachers (Bleachers) for the City recreation program. (b) The City has let contracts for, or reasonably estimates that the cost of the Bleachers is $550,716,. including all administrative and financing costs, and that the sum of $220,144 is to be financed by the issuance of the Note. (c) The City will therefore issue and sell its. General Obligation Capital Note, Series 2002 (Note) in the total principal amount of $220,144 pursuant to the Act to finance a portion of the costs of the Bleachers. The Mayor,. Administrator, Finance Director and City Clerk are authorized and directed to execute and deliver all documents necessary to effect the purchase of the Note by the Purchaser. 1.02. The Mayor and Administrator are authorized and .directed to execute a contract for the purchase of the Note with the Purchaser on behalf of the City. 1.03. The City will forthwith issue and sell the Note to Purchaser pursuant to the Act in the total principal amount of $220,144, originally dated as of delivery to the Purchaser, numbered No. R-1, bearing interest at the rate of 3.00% per annum, and maturing on February 1 in the years and installment amounts as follows: DJK-211793v1 LE110-48 Year Amount 2003. $40,244 2004 43,000 2005 44,300 2006 45,600 2007 47,000 1.04. Optional Redemption. The City may elect on any date to prepay the Note in inverse order-of installment maturities and in increments of $1,000. Prepayments will be at a price of par plus accrued interest to date. of redemption. The City must give the holder of the Note at least 30 days written notice of redemption. Section 2. Form: Registration and Pa 1~. 2.01. Registered Form. The Note .will be issued as a single typewritten note im fully registered form. The interest thereon and the principal amount thereof, is payable by check or draft issued by the Registrar. 2.02. Dates; Interest Payment Dates. The Note will be dated as of delivery to the Purchaser. The interest on the Note is payable on February 1 and August 1 of each .year, commencing February 1, 2003. 2.03. Registration. The City appoints the City Clerk as note 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) Re •sg~ter. The Registrar must keep at the Registrar's principal office a note register in which the Registrar provides for the registration of ownership of the Note and the registration of transfers and exchanges of notes entitled to be registered, transferred or exchanged. (b) Transfer of Certificates. Upon surrender for transfer of the Note 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 notes 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) Persons Deemed Owners. The City and the Registrar may treat the person in whose name a Note is registered in the bond register as the absolute owner of the Note, whether the Note is overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on the Note 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 Note to the extent of the sum or sums so paid. DJK-211793x1 LE110-48 (d) Taxes, Fees and Charges. The Registrar may impose a .charge upon the owner thereof for a transfer or exchange of notes sufficient to .reimburse the Registrar for any tax, fee or other governmental charge required to be paid with respect to the transfer or exchange. 2.04. Execution, Authentication and Delivery. The Note will be prepared under the direction of the City Clerk and executed on behalf of the City by the signatures of the Mayor and the City Clerk. If an officer whose signature or a facsimile of whose signature appears on the Note ceases to be such officer before the delivery of the Note, 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. When the Note has been so prepared, executed and authenticated, the City Clerk. will deliver the same to the Purchaser upon .payment of the purchase price, and the Purchaser is not obligated to see to the application of the purchase price. Section 3. .Form of Note. 3.01. The Note will be printed or typewritten in substantially the following form: No. R-1 UNITED STATES DF AMERICA $220,144 STATE OF MINNESOTA . COUNTY OF DAKOTA CITY OF LAKEVILLE GENERAL OBLIGATION CAPITAL NOTE, SERIES 2002 The City of Lakeville, Minnesota, a duly organized and existing municipal corporation in Dakota County, Minnesota (City), acknowledges itself to be indebted and for value received hereby promises to pay to the League of Minnesota Cities Insurance Trust or its registered: assigns the principal sum of $220,144 on February 1 in the years and the installment amounts as follows: Year Installment Amount 2003 $40,244 2004 43,000 2005 44,300 2006 45,600 2007 47,000 together with interest at the rate of 3.00°/a per annum payable February 1 and August 1 in each year, commencing February 1, 2003. The interest hereon and installment principal amounts hereof are payable in lawful money of the United States of America by the City Clerk of the City as Note DJK-211793v1 LE110-48 Registrar and paying agent. For the prompt and full payment of such principal and interest as the same respectively become due, the fizll faith and credit and taxing powers of the City have been and are hereby irrevocably pledged. The City may elect on any date to prepay installment amounts of this Note in inverse order of installment maturities and in increments of $1,000.. Prepayments will be at a price of par plus accrued interest to date of redemption. The City must .give the holder of this Note at least 30 days written notice of redemption. This Note is issued pursuant. to a resolution adopted by the City Council on April 15, 2002. (the Resolution), for the-purpose of providing money to defray expenses incurred or to be incurred. in purchasing certain items of capital equipment, pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, section 412.301, and the principal hereof and interest hereon are payable primarily from ad valorem taxes, 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 forpayment of this Note and. the City Council has obligated itself to levy additional ad valorem taxes on all taxable properly in .the. City in the event of any deficiency, which taxes may be -levied without-limitation_as to .rate<or amount. As provided in the Resolution and subject to certain.limitations setforth therein; this Note is transferable upon the books of the City at the principal office of the Note 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 Note Registrar, duly executed by the registered owner or the owner's attorney; and may also be surrendered in exchange for notes of other authorized denominations. Upon such transfer or exchange the City will cause a new. note or Notes 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 Note Registrar may deem and treat the person in whose name this Note is registered as the absolute owner hereof, whether this Note is overdue or not, for the purpose of receiving payment and for all other purposes, and neither the City nor the Note 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 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 Note 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 Note does not cause the indebtedness of the City to exceed any constitutional, statutory limitation of indebtedness. The City Council has designated this Note as a "qualified tax exempt obligation" 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. DJK-211793v1 LEI10-48 IN WITNESS WHEREOF, the City of Lakeville, Dakota County, Minnesota, by its City Council, has caused this. Note to be executed on its behalf by `the manual signatures of the Mayor and City Clerk and has caused this Note to be dated as of the date set forth below. Dated: April 15, 2002 CITY OF LAKEVILLE, MINNESOTA 1 ~ /V City Clerk Mayor 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.. Signature of the Date of Registration Registered Owner Ci Clerk League of Minnesota Cities Insurance Trust Federal ID #41-6007047 Section 4. Payment; Security; Pledges and Covenants. 4.OL The Note is payable from the General Obligation Capital Note, Series 2002 Debt Service Fund (Debt Service Fund) hereby created, and the .proceeds of the ad valorem .taxes hereinafter levied are pledged to the Debt Service Fund. If a payment of principal or interest on the Note becomes due or is paid at an installment maturity or early redemption when there is not sufficient money in the Debt Service Fund to pay the same, the City Administrator must pay such principal or interest from the general fund of the City, and the general fund may be reimbursed for those advances out of the proceeds of the taxes levied by this resolution, when collected. 4.02. (a) For the purpose of paying the principal of and interest on the .Note, there is levied a direct annual irrepealable ad valorem taxupon all of the taxable property in the City, which. will be spread upon the tax rolls and collected with and as part of other general taxes of the City. The tax will be credited to the Debt Service Fund above provided and wi1L be in the .years and amounts as follows (year stated being year of levy for collection the following year): Year • 2002/2003 $50,820 2003/2004 50,830 DJK-211793vi LE110-48 1 Y 2004/2005 50,800 2005/2006 50,900 (b) There is irrevocably appropriated to the Debt Service Fund from funds properly available for such purpose, the sum of $46,301.35 for the purpose of .paying the principal of and interest on the Note due on February 1, 2003. 4.03. It is determined that the foregoing appropriation and the estimated collection of the and taxes will produce at least five percent in excess of the amount needed to meet when due, the principal and interest payments on the Note. The tax levy herein provided is irrepealable until the Note is .paid, provided that at the time the City makes its annual tax levies, the City Clerk may certify to the County Treasurer/Auditor of Dakota County the amount available in the Debt Service Fund to pay principal and interest due during the ensuing year, and the County Auditor will. thereupon reduce the levy collectible during such year by the amount so certified. 4.04. The City Clerk is authorized and directed to file a certified copy of this resolution with the .County Treasurer/Auditor of Dakota County 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 Note, certified .copies of proceedings and records of the City relating to the Note 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 Note, and such. instruments, including any heretofore _fizrnished, will be deemed representations of the City as to the facts stated therein. 5.02. It is determined that no official statement or prospectus has been prepared or circulated by the City in connection with the sale of the Note and that the Purchaser has made its own investigation concerning the City as set forth in an investment letter of even date, receipt of which is hereby acknowledged. Section 6. Tax Covenant. 6.01. The City covenants and agrees with the holders from time to time of the Note 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 Note 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 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 Note. 6.02. (a) The City will comply with requirements necessary under the .Code to establish and maintain the exclusion from gross income of the interest on the Note under Section DJK-211793v1 LE110-48 103 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 Note, and the rebate of excess investment earnings to the United States if the Note (together with other obligations reasonably expected to be issued in calendar year 2002) exceeds the small-issuer exception amount of $5,000,000. (b) For purposes of qualifying for the small issuer exception to the federal arbitrage rebate requirements, the City finds, determines and declares that the aggregate face amount of all tax-exempt bonds (other than private activity bonds) issued by the City (and all subordinate entities of the City). during the calendar year in which the Note is issued and outstanding at one time is not reasonably expected to exceed $5,000,000, all within the meaning of Section 148(f)(4)(C) of the Code. 6.03. The City further covenants not to use the proceeds of the Note or to cause or permit them or any of them to be used, in such a manner as to cause the Note to be a "private activity bond" within the meaning of Sections 103 and 141. through 150 of the Code. 6.04. In order to qualify the Note as a "qualified tax-exempt obligation" within the meaning of Section 265(b)(3) of the Code, the City makes the following factual statements and representations: (a) the Note is not a "private activity bond" as .defined in Section 141 of the Code; • (b) the City designates .the Note as a "qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the. Code; (c) the reasonably anticipated amount of tax-exempt obligations (other than private activity bonds that are. not qualified 501(c)(3) bonds) which will be issued by the City (and all subordinate entities of the City) during calendar year 2002 will not exceed $10,000,000; and. (d) not more than $10,000,000 of obligations issued by the City during calendar year 2002 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. DJK-211793v1 LE110-48 Approved and adopted by the City Council of the City of Lakeville, Minnesota, this 15th day of April, 2002. CITY OF T.AKRVILLE, MINNESOTA Robert D. Johns ,Mayor Attest: harlene Friedges, City rk DJK-211793vi LE110-48