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HomeMy WebLinkAbout92-04RESOLUTION NO. 92 -4 RESOLUTION AUTHORIZING ISSUANCE, AWARDING SALE, PRESCRIBING THE FORM AND DETAILS AND PROVIDING FOR THE PAYMENT OF $1,375,000 ICE ARENA LEASE REVENUE BONDS, SERIES 1992 A. WHEREAS, the City of Lakeville, Minnesota (the "City" ), the Housing and Redevelopment Authority of the City of Lakeville (the "Authority"), the Lakeville Community Corporation (the "Corporation "), Lakeville Hockey Boosters, Inc. ( "Boosters ") and Independent School District No. 194, Minnesota (the "District ") have entered into a Memorandum of Understanding, dated July 6, 1992 (the "Memorandum ") setting forth the general understandings of, and the actions to be taken by, each of the parties in connection with the development of an approximately 40,000 square foot ice arena facility (the "Arena ") in the City; and B. WHEREAS, the Memorandum provides that the Arena (i) will be constructed on land to be provided by the District to the Authority, (ii) will be owned by the Authority, (iii) will be leased by the Authority to the City pursuant to the terms of a lease- purchase agreement pursuant to which the City will be responsible for the construction of the Arena and will lease the Arena from the Authority for rentals sufficient to retire revenue bonds to be issued by the Authority to provide the financing for the Arena, and (iv) will be subleased by the City to the Corporation for operation for sublease rentals sufficient, together with certain gaming revenues to be provided by Boosters, to provide the City with the necessary funds to pay the rentals due to the Authority under the lease- purchase agreement; and C. WHEREAS, it is contemplated by the Memorandum, in Section III thereof, that funds for the construction of the Arena will be provided by the sale of lease revenue bonds by the Authority; and D . WHEREAS, the amount estimated to be necessary to finance the Arena will require the issuance of the Authority's Ice Arena Lease Revenue Bonds, Series 1992 (the "Series 1992 Bonds ", or individually a "Series 1992 Bond" ) in the aggregate principal amount of $1,375,000, as hereinafter provided; and E. WHEREAS, the Board reasonably expects that the rentals to be received by the Authority from the City pursuant to the lease- purchase agreement will be sufficient to pay the debt service on the Series 1992 Bonds and any Additional Bonds issued pursuant to Article III hereof as the same becomes due; and F. WHEREAS, the Bonds (as hereinafter defined) and the interest accruing thereon are payable solely from the rental payments to be provided by the City pursuant to the lease - purchase agreement and do not give rise to a charge against the general credit or taxing powers of the Authority or the City and neither the full faith and credit nor the taxing powers of the Authority or the City are pledged for the payment of the Bonds or interest thereon. NOW, TFEEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Lakeville, Minnesota, as follows: ARTICLE I DEFINITIONS Section 1.1. Definitions In addition to the words and terms elsewhere defined in this Resolution, including the foregoing recitals, the following words and terms as used in this Resolution shall have the following meanings unless the context or use indicates another or different meaning or intent: "Additional Bonds" means Bonds, if any, issued by the Authority pursuant to Article III hereof subsequent to the issuance of the Series 1992 Bonds. "Arena" means the approximate 40,000 square foot ice arena facility to be constructed in accordance with the Memorandum, as more fully described in Exhibit A to the Memorandum. "Bond Counsel" means an attorney or law firm selected by the City, having a favorable reputation for its opinions relating to municipal tax - exempt financing matters. "Bondholder" or "Holder ", with reference to any Bond, means the owner of such Bond, determined in accordance with the Resolution. "Code" means the Internal Revenue Code of 1986. "Counsel" means an attorney duly admitted to practice law before the highest court of any state and, unless otherwise expressly provided herein, may include legal counsel for the Authority. "Escrow Obligations" means, with respect to any obligation which secures all or a portion of a series of Bonds, the obligations permitted by law to be used to defease such series of Bonds or portion thereof. "Gaming Revenue Agreement" means the Gaming Revenue Agreement to be entered into between the City and Boosters, substantially in the form attached as Exhibit F to the Memorandum "Lease- Purchase Agreement" means the Lease- Purchase Agreement to be entered into between the Authority and the City relating to the Arena, substantially in the form attached as Exhibit D to the Memorandum. "Outstanding ", when used with respect to Bonds, means all Bonds which have been duly issued, authenticated and delivered by the Authority under this Resolution, except: (a) Bonds cancelled after purchase in the open market or because of payment at or before maturity; (b) Bonds for the payment or redemption of which cash or Escrow Obligations shall have been theretofore deposited with an escrow agent authorized by law (whether upon or prior to the maturity or redemption date of any such Bonds); provided that if such Bonds are to be prepaid or redeemed, notice of such -1- prepayment or redemption shall have been given or irrevocable arrangements shall have been made therefor, (c) Bonds in lieu of which others have been authenticated hereunder, and (d) Bonds held by the City. "Person" means any natural person, firm, joint venture, association, partnership, business trust, corporation, public body, agency or political subdivision thereof or any other similar entity. "Series 1992 Bonds" means the Ice Arena Lease Revenue Bonds, Series 1992, originally dated as of September 1, 1992, and issued by the Authority pursuant to this Resolution. "Sublease Agreement" means the Sublease Agreement to be entered into between the City, as sublessor, and the Corporation, as sublessee, substantially in the form attached as Exhibit E to the Memorandum. -2- ARTICLE 11 SALE AND TERMS OF SERIES 1992A BONDS Section 2.1. Determination of Public Purpose This Board hereby determines and finds that the provision of the Arena in the City would be of substantial public benefit to the residents of the City and would enhance the image of the City as a desirable location for homes and businesses, and, by providing an attractive amenity to the community available for use by residents of the community and students of the school district, would assist the Authority in attracting developers to the City for the purpose of developing and redeveloping land within the City, including land within redevelopment project areas and municipal development districts heretofore created by the Authority and the City, thereby assisting in the development and redevelopment of blighted areas and assisting in the prevention of blight and blighting factors and the causes of blight. Hence, the Board has determined that it is in furtherance of the corporate purposes of the Authority to cooperate with the City and other parties to the Memorandum in providing the Arena pursuant to the provisions of Minnesota Statutes, Sections 469.012 and 469.041, to issue the Series 1992 Bonds in accordance with the provisions of Sections 469.034, 469.035 and 475.79, and to enter into the Lease- Purchase Agreement for the Arena with the City in accordance with the provisions of Sections 465.035, 465.71, 469.012(21), and 471.64, subd. 1. Section 2.2. Sak. To provide financing for the construction of the Arena, this Board has determined to proceed with the issuance of the Series 1992 Bonds in accordance with the provisions of this resolution. This Board has received an offer to purchase the Series 1992 Bonds from Piper Jaffray, Inc. and John G. Kinnard & Company, Inc. (collectively, the 'Purchaser "), said offer being to purchase the Series 1992 Bonds at a price of $1,347,500 plus accrued interest to the day of delivery and payment, on the further terms and conditions hereinafter set forth. Said offer is hereby determined to be advantageous to the Authority and the residents of the City and the sale of the Series 1992 Bonds is hereby awarded to the Purchaser, and the Chair and Secretary are hereby authorized and directed on behalf of the Authority to execute a contract for the sale of the Bonds in accordance with the terms of the bid. Section 2.3. Title: Original Issue Date: Denominations: Maturities: Interest. The Series 1992 Bonds shall be titled "Ice Arena Lease Revenue Bonds, Series 1992 ", shall be dated September 1, 1992, as the date of original issue and shall be issued forthwith on or after such date as fully registered bonds. The Series 1992 Bonds shall be numbered from R -1 upward in the denomination of $5,000 each or in any integral multiple thereof of a single maturity. The Series 1992 Bonds shall mature on each February 1 and August 1 in the years and amounts as follows, and shall bear interest until maturity or earlier redemption at the rates per annum set forth opposite such maturity dates and amounts: -3- Maturity Maturity Date Amount Bait Date mount B= February 1, 1995 $20,000 5.00° February 1, 2004 $35,000 6.500 August 1, 1995 20,000 5.00 August 1, 2004 35,000 6.50 February 1, 1996 20,000 5.20 February 1, 2005 40,000 6.60 August 1, 1996 20,000 5.20 August 1, 2005 40,000 6.60 February 1, 1997 25,000 5.40 February 1, 2006 40,000 6.70 August 1, 1997 25,000 5.40 August 1, 2006 45,000 6.70 February 1, 1998 25,000 5.60 February 1, 2007 45,000 6.75 August 1, 1998 25,000 5.60 August 1, 2007 45,000 6.75 February 1, 1999 25,000 5.80 February 1, 2008 45,000 6.80 August 1, 1999 25,000 5.80 August 1, 2008 50,000 6.80 February 1, 2000 30,000 6.00 February 1, 2009 50,000 6.85 August 1, 2000 30,000 6.00 August 1, 2009 55,000 6.85 February 1, 2001 30,000 6.20 February 1, 2010 55,000 6.90 August 1, 2001 30,000 6.20 August 1, 2010 60,000 6.90 February 1, 2002 30,000 6.30 February 1, 2011 60,000 6.95 August 1, 2002 35,000 6.30 August 1, 2011 60,000 6.95 February 1, 2003 35,000 6.40 February 1, 2012 65,000 7.00 August 1, 2003 35,000 6.40 August 1, 2012 65,000 7.00 All dates are inclusive. Interest shall be payable semiannually on February 1 and August 1 in each year, commencing February 1, 1993. Interest shall be calculated on the basis of a 360 -day year of twelve 30-day months. Section 2.4. Qptional Rede=tion Series 1992 Bonds maturing on or after August 1, 2000 shall be subject to redemption, at the option of the Authority, in whole or in part, on February 1, 2000, and any interest payment date thereafter, at a price equal to the principal amount thereof plus interest accrued to the date of redemption. Section 2.5. Special Redemption Series 1992 Bonds may be redeemed by the Authority, in whole and not in part, on February 1, 1994, at a redemption price equal to their principal amount plus accrued interest to the redemption date, in the event the Authority determines, in its sole discretion, that the Corporation and Boosters have not met the fundraising and gaming revenue requirements speed in Section IV of the Memorandum, and the parties have been unable to execute the agreements and take the actions specified in Section V of the Memorandum. Section 2.6. Procedure for Redemption In the event of a partial redemption of the Series 1992 Bonds, the Authority shall select the maturities to be prepaid; and if only part of the Series 1992 Bonds having a common maturity date are called for prepayment, the specific Series 1992 Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Series 1992 Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of redemption shall be given to each affected registered Holder of the Bonds not less than thirty (30) days before the redemption date. No failure to mail a copy of such notice to a Holder, and no defect in any notice which is mailed, shall affect the validity of the redemption of any Series 1992 Bond not affected by such defect or failure. -4- To effect a partial redemption of Series 1992 Bonds having a common maturity date, the Bond Registrar prior to giving notice of redemption shall assign to each Series 1992 Bond having a common maturity date a distinctive number for each $5,000 of the principal amount of such Series 1992 Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers so assigned to such Series 1992 Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Series 1992 Bonds to be redeemed. The Series 1992 Bonds to be redeemed shall be the Series 1992 Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of each such Series 1992 Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Series 1992 Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the Authority or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the Authority and Bond Registrar duly executed by the Holder thereof or his, her or its attorney duly authorized in writing) and the Authority shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the Holder of such Series 1992 Bond, without service charge, a new Series 1992 Bond or Bonds having the same stated maturity and interest rate and of any authorized denomination or denominations, as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Series 1992 Bond so surrendered Section 2.7. Form of Bond The Series 1992 Bonds, together with the Bond Registrar's Certificate of Authentication, the form of Assignment and the registration information thereon, shall be in substantially the following form: -5- UNITED STATES OF AMERICA STATE OF MINNESOTA DAKOTA COUNTY HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF LAKEVILIX R- $ ICE ARENA LEASE REVENUE BOND, SERIES 1992 INTEREST MATURITY DATE OF RATE DATE ORIGINAL ISSUE CUSIP September 1, 1992 REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS KNOW ALL PERSONS BY THESE PRESENTS that the Housing and Redevelopment Authority of the City of Lakeville, Minnesota (the "Issuer "), hereby acknowledges that it is indebted and for value received promises to pay to the registered owner specified above, or registered assigns, in the manner hereinafter set forth, the principal amount specified above, on the maturity date specified above, unless called for earlier redemption, and to pay interest thereon semiannually on February 1 and August 1 of each year (each, an "Interest Payment Date ") commencing February 1, 1993, at the rate per annum specified above, (calculated on the basis of a 360 -day year of twelve 30-day months) until the principal sum is paid or has been provided for. This Series 1992 Bond will bear interest from the most recent Interest Payment Date to which interest has been paid or, if no interest has been paid, from the date of original issue hereof. The principal of and premium, if any, on this Series 1992 Bond are payable upon presentation and surrender hereof at the principal office of First Wisconsin Trust Company, in Milwaukee, Wisconsin (the "Bond Registrar "), acting as paying agent, or any successor paying agent duly appointed by the Issuer. Interest on this Series 1992 Bond will be paid on each Interest Payment Date by check or draft mailed to the person in whose name this Series 1992 Bond is registered (the "Holder" or "BondHolder ") on the registration books of the issuer maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth day of the calendar month next preceding such Interest Payment Date (the "Regular Record Date "). Any interest not so timely paid shall cease to be payable to the person who is the Holder hereof as of the Regular Record Date, and shall be payable to the person who is the Holder hereof at the close of business on a date (the "Special Record Date ") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given to BondHolders not less than ten days prior to the Special Record Date. The principal of and premium, if any, and interest on this Series 1992 Bond are payable in lawful money of the United States of America. 0 REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS so SERIES 1992 BOND SET FORTH ON THE REVERSE HEREOF, WHICH PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE. IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to happen and to be performed, precedent to and in the issuance of this Series 1992 Bond, have been done, have happened and have been performed, in regular and due form, time and manner as required by law, and this Series 1992 Bond, together with all other debts of the Issuer outstanding on the date of original issue hereof and on the date of its issuance and delivery to the original purchaser does not exceed any constitutional or statutory limitation of indebtedness. IN WITNESS WHEREOF, the Housing and Redevelopment Authority of the City of Lakeville, Minnesota, has caused this Series 1992 Bond to be executed in its behalf by the facsimile signatures of its Chair and its Secretary. Date of Registration: BOND REGISTRAR'S HOUSING AND REDEVELOPMENT CERTIFICATE OF AUTHORITY OF THE CITY OF AUTHENTICATION LAKEVI LIE, MINNESOTA This Series 1992 Bond is one of the Series 1992 Bonds described in the Resolution mentioned within. /s/ Facsimile Chair First Wisconsin Trust Company, Milwaukee, Wisconsin, as Bond Registrar By Authorized Signature /s/ Facsimile Secretary -7- 0 ON REVERSE OF SERIES 1992 BOND Qptional Redemption Series 1992 Bonds maturing on or after August 1, 2000 are subject to redemption and prepayment in whole or in part, at the option of the Issuer, on February 1, 2000 and on any interest payment date thereafter at a price of the principal amount thereof plus accrued interest to the date of redemption. Qptional Redemption on February 1. 1994 Series 1992 Bonds are also subject to redemption and prepayment, at the option of the Issuer, in whole but not in part, on February 1, 1994, at a price equal to the principal amount thereof plus interest accrued to the date of redemption, in the event the Issuer determines, in its sole discretion, that certain funds required to be raised for the construction of the ice arena financed by the Series 1992 Bonds have not been raised in accordance with the provisions of Section IV of that certain Memorandum of Understanding, dated July 6, 1992 (the " Memorandum "), between the Issuer, the City of Lakeville, Independent School District No. 194, Minnesota, Lakeville Community Corporation and Lakeville Hockey Boosters, Inc., and certain agreements specified in Section V of the Memorandum have not been executed by the foregoing parties. Procedure for Redemption In the event of a partial redemption of the Series 1992 Bonds, the Issuer shall select the maturities to be prepaid; and if only part of the Series 1992 Bonds having a common maturity date are called for prepayment, the specific Series 1992 Bonds to be prepaid shall be chosen by lot by the Bond Registrar. Series 1992 Bonds or portions thereof called for redemption shall be due and payable on the redemption date, and interest thereon shall cease to accrue from and after the redemption date. Mailed notice of redemption shall be given to each affected Holder of the Series 1992 Bonds not less than thirty (30) days before the redemption date. No failure to mail a copy of such notice to a Holder, and no defect in any notice which is mailed, shall affect the validity of the redemption of any Series 1992 Bond not affected by such defect or failure. Selection of Series 1992 Bonds for Redemption: Partial Redemption To effect a partial redemption of Series 1992 Bonds having a common maturity date, the Bored Registrar shall assign to each Series 1992 Bond having a common maturity date a distinctive number for each $5,000 of the principal amount of such Series 1992 Bond. The Series 1992 Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in its discretion, from the numbers assigned to the Series 1992 Bonds, as many numbers as, at $5,000 for each number, shall equal the principal amount of such Series 1992 Bonds to be redeemed. The Series 1992 Bonds to be redeemed shall be the Series 1992 Bonds to which were assigned numbers so selected; provided, however, that only so much of the principal amount of such Series 1992 Bond of a denomination of more than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If a Series 1992 Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the Issuer or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the Issuer and Bond Registrar duly executed by the Holder thereof or his, her or its attorney duly authorized in writing) and the Issuer shall execute (if necessary) and the Bond Registrar shall authenticate and deliver to the Holder of such Series 1992 Bond, without service charge, a new Series 1992 Bond or Series 1992 Bonds having the same stated maturity and interest rate and of any authorized denomination or denominations, as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Series 1992 Bond so surrendered. -8- ization. This Series 1992 Bond is one of an issue in the total principal amount of $1,375,000, all of like date of original issue and tenor, except as to M number, maturity, interest rate, denomination and redemption privilege, which Series 1992 Bond has been issued pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.012, 469.034, 469.035 and 475.79, and pursuant to a resolution adopted by the Board of Commissioners of the Issuer on August 3, 1992 (the "Resolution'), for the purpose of providing money to finance the construction and equipping of an approximately 40,000 square foot ice arena facility (the 'Project ") in the City of Lakeville. The Series 1992 Bonds are payable solely from the Ice Arena Lease Revenue Bond Sinking Fund of the Issuer, to which has been pledged the rental payments to be received by the Issuer from the City pursuant to the Lease- Purchase Agreement (the Agreement) to be executed between the Authority, as owner and lessor of the Project, and the City, as purchaser and lessee of the Project. Said rental payments, if timely made, will be in an amount sufficient to pay, with any proceeds of the Series 1992 Bonds and any other funds appropriated for such purpose, the principal of and interest on the Series 1992 Bonds as such becomes due. Pursuant to the provisions of the Agreement, the City has the right to cancel and terminate the Agreement, in whole but not in part, at the end of any fiscal year of the City and to return possession of the Project to the Issuer. The Series 1992 Bonds shall not constitute an indebtedness of the State of Minnesota, the City or any other political subdivision and neither the State, the City nor any other political subdivision shall be liable on the Series 1992 Bonds, nor shall the Series 1992 Bonds be payable out of any funds of the State, the City or other political subdivision other than the Issuer. No Holder of this Series 1992 Bond shall ever have the right to compel any exercise of the full faith and credit and taxing power of the State of Minnesota, the Issuer or the City to pay this Series 1992 Bond or the interest hereon, or to enforce payment thereof against any property of the State of Minnesota, the Issuer or the City other than the rental payments so pledged Additional Bonds may be issued and made payable on a parity with the Series 1992 Bonds from the Ice Arena Lease Revenue Bond Sinking Fund upon the terms and conditions provided in the Resolution. Remedies The Holders of twenty-five percent (25%) or more in aggregate principal amount of Bonds at any time outstanding may, either by law or in equity, by suit, action, or other proceedings, protect and enforce the rights of all Holders of Bonds then outstanding, or enforce and compel the performance of any and all of the covenants and duties specified in the Resolution to be performed by the Issuer or its officers and agents. Denominations: Exchange: Resolution The Series 1992 Bonds are issuable solely as fully registered bonds in the denominations of $5,000 and integral multiples thereof of a single maturity and are exchangeable for fully registered Series 1992 Bonds of other authorized denominations in equal aggregate principal amounts at the principal office of the Bond Registrar, but only in the manner and subject to the limitations provided in the Resolution. Reference is hereby made to the Resolution for a description of the rights and duties of the Bond Registrar. Copies of the Resolution are on file in the principal office of the Issuer. Transfer This Series 1992 Bond is transferable by the Holder in person or by his, her, or its attorney duly authorized in writing at the principal office of the Bond Registrar upon presentation and surrender hereof to the Bond Registrar, all subject to the terms and conditions provided in the Resolution and to reasonable regulations of the Issuer contained in any agreement with the Bond Registrar. Thereupon the Issuer shall execute and the Bond Registrar shall authenticate and deliver, in exchange for this Series 1992 Bond, one or more new fully registered Series 1992 Bonds in the name of the transferee (but not registered in blank or to "bearer" or similar designation), of an authorized denomination or denominations, in aggregate principal 0 amount equal to the principal amount of this Series 1992 Bond, of the same maturity and bearing so interest at the same rate. Fuss upon Transfer or Loss The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of this Series 1992 Bond and any legal or unusual costs regarding transfers and lost Series 1992 Bonds. Treatment of Registered Owners The Issuer and the Bond Registrar may treat the person in whose name this Series 1992 Bond is registered as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Series 1992 Bond shall be overdue, and neither the Issuer nor the Bond Registrar shall be affected by notice to the contrary. Authentication This Series 1992 Bond shall not be valid or become obligatory for any purpose or be entitled to any security unless the Certificate of Authentication hereon shall have been executed by the Bond Registrar. ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this Series 1992 Bond, shall 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 the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UTMA - as custodian for (Cust) (Minor) under the Uniform Transfers to Minors Act (State) Additional abbreviations may also be used though not in the above list. -10- N ASSIGNMENT For value received, the undersigned hereby sells, assigns and transfers unto the within Series 1992 Bond and does hereby irrevocably constitute and appoint attorney to transfer the Series 1992 Bond on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: Notice: The assignor's signature to this assignment must correspond with the name as it appears upon the face of the within Series 1992 Bond in every particular, without alteration or any change whatever. Signature(s) must be guaranteed by a national bank or trust company or by a brokerage firm having a membership in one of the major stock exchanges. -11- M Section 2.8. Execution . The Series 1992 Bonds shall be executed on behalf of the Authority by the facsimile signatures of its Chair and Secretary, and the corporate seal, if any, shall be omitted on the Series 1992 Bonds as permitted by law. In case either such officer a facsimile of whose signature shall appear on the Series 1992 Bonds shall cease to be such officer before the delivery of the Bonds, such facsimile shall nevertheless be valid and sufficient for all purposes, the same as if he or she had remained in office until delivery. Section 2.9. Authentication No Series 1992 Bond shall be valid or obligatory for any purpose or be entitled to any security or benefit under this resolution unless and until a Certificate of Authentication on such Series 1992 Bond, substantially in the form hereinabove set forth, shall have been duly executed by an authorized representative of the Bond Registrar. Certificates of Authentication on different Series 1992 Bonds need not be signed by the same person. The Bond Registrar shall authenticate the signatures of officers of the Authority on each Series 1992 Bond by execution of the Certificate of Authentication on the Series 1992 Bond and by inserting as the date of registration in the space provided the date on which the Series 1992 Bond is authenticated, except that for purposes of delivering the original Bonds to the Purchaser, the Bond Registrar shall insert as a date of registration the date of original issue, which date is September 1, 1992. The executed Certificate of Authentication on each Series 1992 Bond shall be conclusive evidence that it has been authenticated and delivered under this Resolution. Section 2.10. Bond Registrar First Wisconsin Trust Company, in Milwaukee, Wisconsin, is appointed to act as Bond Registrar and transfer agent with respect to the Series 1992 Bonds (the "Bond Registrar "), and shall do so unless and until a successor Bond Registrar is duly appointed, all pursuant to any contract the Authority and Bond Registrar shall execute which is consistent herewith. The Bond Registrar shall also serve as paying agent unless and until a successor paying agent is duly appointed. Principal and interest on the Series 1992 Bonds shall be paid to the registered Holders (or record Holders) of the Series 1992 Bonds in the manner set forth in the form of Series 1992 Bond and in Section 2.13 of Article II of this Resolution. Section 2.11. Registration: Transfer. Exchange The Authority will cause to be kept at the principal office of the Bond Registrar a Bond register in which, subject to such reasonable, regulations as the Bond Registrar may prescribe, the Bond Registrar shall provide for the registration of Series 1992 Bonds and the registration of transfers of Series 1992 Bonds entitled to be registered or transferred as herein provided. Upon surrender for transfer of any Series 1992 Bond at the principal office of the Bond Registrar, the Authority shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration and deliver, in the name of the designated transferee or transferees, one or more new Series 1992 Bonds of any authorized denomination or denominations of a like aggregate principal amount, having the same stated maturity and interest rate, as requested by the transferor, provided, however, that no Series 1992 Bond may be registered in blank or in the name of "bearer" or similar designation. At the option of the Holder, Series 1992 Bonds may be exchanged for Series 1992 Bonds of any authorized denomination or denominations of a like aggregate principal amount and stated maturity, upon surrender of the Series 1992 Bonds to be exchanged at the principal office of the Bond Registrar. Whenever any Series 1992 Bonds are so surrendered for exchange, the Authority shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of registration of, and deliver the Series 1992 Bonds which the Holder making the exchange is entitled to receive. -12- All Series 1992 Bonds surrendered upon any exchange or transfer provided for in this resolution shall be promptly canceled by the Bond Registrar and thereafter disposed of as directed by the Authority. All Series 1992 Bonds delivered in exchange for or upon transfer of Series 1992 Bonds shall be valid special obligations of the Authority evidencing the same debt, and entitled to the same benefits under this resolution, as the Series 1992 Bonds surrendered for such exchange or transfer. Every Series 1992 Bond presented or surrendered for transfer or exchange shall be duly endorsed or be accompanied by a written instrument of transfer, in form satisfactory to the Bond Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing. The Bond Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange of any Series 1992 Bond. Transfers shall also be subject to reasonable regulations of the Authority contained in any agreement with the Bond Registrar, including regulations which permit the Bond Registrar to close its transfer books between record dates and payment dates. Section 2.12. Rights Unon Transfer or Exchange Each Series 1992 Bond delivered upon transfer of or in exchange for or in lieu of any other Series 1992 Bond shall carry all the rights to interest accrued and unpaid, and to accrue, which were carried by such other Series 1992 Bond. Section 2.13. Interest Payment. Record Date Interest on any Series 1992 Bond shall be paid on each interest payment date by check or draft mailed to the person in whose name the Bond is registered (the "Holder" ) on the registration books of the Authority maintained by the Bond Registrar and at the address appearing thereon at the close of business on the fifteenth (15th) day of the calendar month next preceding such interest payment date (the "Regular Record Date ") . Any such interest not so timely paid shall cease to be payable to the person who is the Holder thereof as of the Regular Record Date, and shall be payable to the person who is the Holder thereof at the close of business on a date (the "Special Record Date ") fixed by the Bond Registrar whenever money becomes available for payment of the defaulted interest. Notice of the Special Record Date shall be given by the Bond Registrar to the Holders not less than ten (10) days prior to the Special Record Date. Section 2.14. Treatment of Registered Owner The Authority and the Bond Registrar may treat the person in whose name any Series 1992 Bond is registered as the owner of such Series 1992 Bond for the purpose of receiving payment of principal of and premium, if any, and interest on, such Series 1992 Bond and for all other purposes whatsoever whether or not such Series 1992 Bond shall be overdue, and neither the Authority nor the Bond Registrar shall be affected by notice to the contrary. Section 2.15. Deli verv.AQpl cation_ Proceeds The Series 1992 Bonds when so prepared and executed shall be delivered by the Authority to the Purchaser upon receipt of the purchase price, and the Purchaser shall not be obliged to see to the proper application thereof. -13- ARTICLE III ADDITIONAL BONDS Section 3.1. Additional Bonds. So long as any Bonds are Outstanding, the Authority may issue Additional Bonds payable on a parity with the Bonds then Outstanding from the Ice Arena Lease Revenue Bond Sinking Fund to fund improvements to or renovations and repairs of the Arena, or to refund, in whole or in part, Outstanding Bonds, but in any such case the Additional Bonds shall not be issued unless (i) the Lease- Purchase Agreement has been amended or supplemented to require the payment of rentals by the City at least sufficient to pay the principal of, premium, if any, and interest on all Outstanding Bonds, including the Additional Bonds to be issued, as such becomes due subsequent to the issuance of the Additional Bonds, (ii) the balance in the Ice Arena Lease Revenue Bond Reserve Fund is increased at the time of issuance of the Additional Bonds to an amount not less than the Reserve Requirement applicable after the issuance of the Additional Bonds (as defined in Section 4.4 hereof), and (iii) an opinion of Bond Counsel is filed with the Authority stating that the issuance of the Additional Bonds will not cause the interest payable on the Outstanding Bonds to become includible in gross income of the recipients thereof for federal income tax purposes. -14- ARTICLE IV CREATION OF FUNDS Section 4.1. Cost of Issuance Fund There shall be created on the books of the Authority a "Cost of Issuance Fund" into which shall be deposited the sum of $91,250 received from Boosters at closing of the Series 1992 Bonds. Funds on deposit in the Cost of Issuance Fund shall be used to pay costs of issuance in connection with the Series 1992 Bonds, including financial consulting fees, underwriter's compensation (by transfer of $27,500 to the Capital Expenditures Fund created in Section 4.2 to reimburse said Fund for the $27,500 underwriting fee subtracted by the Purchasers from the amount paid for the Series 1992 Bonds at closing), bond counsel fee, bond printing, Authority counsel fees, fees of the Bond Registrar and similar costs. Any funds remaining in the Cost of Issuance Fund upon payment of all issuance costs of the Series 1992 Bonds shall be remitted to Boosters. Section 4.2. Coital Expenditures Fund. (a) There shall be a Capital Expenditures Fund created on the books of the Authority which shall be used to record the receipt and disbursement of proceeds of Series 1992 Bonds and any other moneys appropriated for the payment of expenditures which, raider generally accepted accounting principles, constitute capital costs necessarily incurred for the construction of the Arena, including but not limited to the cost of improvements to land, buildings, structures and capital equipment, and the cost of all architectural, engineering, legal and other professional services relating thereto. Upon the issuance of the Series 1992 Bonds there shall be credited to the Capital Expenditures Fund $1,165,498.75 of the proceeds of the Series 1992 Bonds. There shall also be deposited into the Capital Expenditures Fund the fund drive proceeds and gaming revenues required to be provided by the Corporation and Boosters in accordance with the provisions of Section V B of the Memorandum. (b) In the event the Authority determines to call the Series 1992 Bonds for special redemption in accordance with the provisions of Section 2.5 hereof, funds on deposit in the Capital Expenditures Fund shall be transferred to the Ice Arena Lease Revenue Bond Sinking Fund and applied to the payment of the principal of and interest on the Series 1992 Bonds called for redemption on February 1, 1994. (c) Prior to February 1, 1994, investment earnings on funds on deposit in the Capital Expenditures Fund shall be transferred as received to the Ice Arena Lease Revenue Bond Sinking Fund and applied to payment of interest on the Series 1992 Bonds as such becomes due to and including February 1, 1994. Section 4.3. I ce Arena Lease Revenue Bond Sinldng Fund To the Ice Arena Lease Revenue Bond Sinking Fund (the "Sinking Fund "), which shall be created upon the books of the Authority, there is hereby appropriated the accrued interest received on the sale of the Series 1992 Bonds and capitalized interest in the amount of $44,501.25. To the Sinking Fund there is also irrevocably pledged and appropriated and shall be credited (i) the investment earnings on amounts held in the Capital Expenditures Fund transferred in accordance with Section 4.2 hereof, (ii) the investment earnings on amounts held in the Ice Arena Lease Revenue Bond Reserve Fund transferred in accordance with Section 4.4 hereof, and (iii) all rental payments received from the City pursuant to the provisions of Section 5.1 of the Lease- Purchase Agreement. The Sinking Fund shall be used only to pay the principal of and interest on the Bonds issued and made payable therefrom, including the Series 1992 Bonds. The balance on hand in the Sinking Fund on each -15- interest payment date will be used first pro rata to pay the interest then due on all Bonds payable therefrom, and second to pay the principal of the matured Bonds in order of their maturity dates, pro rata with respect to Bonds maturing on the same date. Investment earnings on amounts held in the Sinking Fund shall be retained therein and applied to the payment of principal of and interest on Bonds payable therefrom. Section 4.4. Ice Arena Lease Revenue Bond Reserve Fund There is hereby created on the books of the Authority an Ice Arena Lease Revenue Bond Reserve Fund (the "Reserve Fund") and the Authority hereby appropriates to the Reserve Fund from proceeds of the Series 1992 Bonds the sum of $137,500 which amount is equal to the "Reserve Requirement" for the Series 1992 Bonds. With respect to Bonds issued and made payable from the Sinking Fund, the 'Reserve Requirement" shall be equal to the lesser of (i) the maximum amount of principal and interest to become due in any future fiscal year on the Bonds payable from the Sinking Fund, or (ii) 10% of the proceeds of all Bonds issued and made payable from the Ice Sinking Fund (the "Reserve Requirement "). So long as the balance in the Reserve Fund is not less than the Reserve Requirement, interest earnings thereon shall be transferred as received to the Sinking Fund. Additionally, any amount by which the principal balance of funds on deposit in the Reserve Fund at any time exceeds the Reserve Requirement shall be transferred to the Sinking Fund. Moneys on hand in the Reserve Fund shall be used only to pay interest or principal actually due on Bonds when, if and to the extent that such interest or principal cannot be paid in full from the Sinking Fund, provided that the amount of the Reserve Fund allocable to any issue of Bonds may used at any time to discharge such issue of Bonds in accordance with Section 5. 1, so long as the balance remaining on hand in the Reserve Fund following such use is not less than the Reserve Requirement with respect to Outstanding Bonds which continue to be payable from the Sinking Fund. The balance in the Reserve Fund shall be deemed to be the sum of all cash and the amortized cost of all securities held in the Reserve Fund. Section 4.5. Investments All funds on hand in the foregoing funds shall be deposited or invested in accordance with Minnesota Statutes, Section 475.66. All securities so purchased shall mature at or before the time when it is estimated that the proceeds thereof will be needed for the purposes of the Fund from which funds are withdrawn for the purchase. Interest earnings on the Funds shall be accounted for as set forth in Sections 4.1 through 4.4 above. -16- FTIVIT& D DEFEASANCE, TAX COVENANTS, REMEDIES Section 5.1. Defeasance When all Bonds, or any series thereof, made payable from the Sinking Fund have been discharged as provided in this Section 5.1, all pledges, covenants and other rights granted by this resolution to the Holders of such Bonds shall cease. The Authority may discharge all Bonds which are due on any date by depositing with the paying agent or agents for such Bonds on or before that date a sum sufficient for the payment thereof in full; or if any Bond shall not be paid when due, it may nevertheless be discharged by depositing with the paying agent a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit. The Authority may also discharge any prepayable Bonds which are called for redemption on any date in accordance with their terms, by depositing with the paying agent or agents on or before that date an amount equal to the principal, interest and redemption premium, if any, which are then due thereon, provided that notice of such redemption has been duly given as provided in the resolution authorizing such Bonds. The Authority may also at any time discharge any issue of Bonds in its entirety, 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 United States agencies which are authorized by law to be so deposited, bearing interest payable at such times and at such rates and maturing on such dates as shall be required to provide funds sufficient to pay all principal, interest and redemption premiums, if any, to become due on all Bonds of the issue on and before their maturity, or, if some or all Bonds of the issue are to be called for redemption, to their earlier redemption date. Section 5.2. Bondholder Remedies The Holders of twenty-five percent (25%) or more in aggregate principal amount of all Outstanding Bonds may, either at law or in equity, by suit, action, or other proceedings, protect and enforce the rights of all Holders of all Outstanding Bonds or enforce or compel the performance of any and all of the covenants and duties specified in this Resolution, to be performed by the Authority or their officers and agents; provided, however, that nothing herein shall affect or impair the right of the Holder of any Bond to enforce the payment of the principal of and interest on any Bond at and after the maturity thereof, or the obligation of the Authority to pay the principal of and interest on each of the Bonds issued hereunder to the respective Holders thereof at the time and place, from the source and in the manner provided in the Bonds. Section 5.3. Arbitrage Covenants No portion of the gross proceeds of the Bonds shall be used directly or indirectly to acquire higher yielding investments or to replace funds which were used directly or indirectly to acquire higher yielding investments, except (1) for a reasonable temporary period, if any, until such proceeds are needed for the purpose for which the Bonds were issued, (2) as part of a reasonably required reserve fund not in excess of the Reserve Requirement and (3) in addition to the above in an amount not greater than the lesser of five percent (5%) of the proceeds of each issue of Bonds or $100,000. To this effect, any gross proceeds of the Bonds in excess of amounts which under the applicable federal arbitrage regulations may be invested in materially higher yielding obligations after taking into account any applicable "reasonably required reserve ", "temporary periods" or "minor portion" will be invested in nonpurpose investments with yields not materially higher than the yield of the issue of Bonds to which such gross proceeds are properly allocated under applicable federal arbitrage regulations. For purposes of complying with Section 148 of the Code and applicable regulations relating to arbitrage rebate, the Authority will (i) -17- prepare or have prepared a calculation of the rebatable arbitrage at the times and in a manner consistent with the provisions of Section 148 and applicable regulations, (ii) pay to the United States Department of the Treasury not later than 60 days after the end of each installment computation date, an amount equal to at least 90% of the rebatable arbitrage calculated as of the date of such computation date (less any amount thereof previously paid) and not later than 60 days after the final computation date, an amount equal to 100% of the rebatable arbitrage (less any amount thereof previously paid), (iii) make each required payment to the Internal Revenue Service Center, Philadelphia, Pennsylvania 19255, on or before the date such payment is due, accompanied by Internal Revenue Service Form 8038 -T (or in such other manner as may hereinafter be specified in applicable regulations of the Internal Revenue Service), and (iv) retain records of the calculations required by this Section 5.3 until six years after the final computation date. Section 5.4. ,Specific Tax Covenants The Authority makes the following specific covenants with the owners from time to time of the Series 1992 Bonds: (a) At all times during the term of the Series 1992 Bonds the Arena will owned by the Authority, by another governmental unit or by a 501(c)(3) organization (as defined in Section 150(a)(4) of the Code), and the Authority will not enter into any lease, use agreement, management agreement or other contract (or permit such action to be taken by any other party) if the effect of such action would be to cause the Series 1992 Bonds to be considered "private activity bonds" or "private loan bonds" under Section 141 of the Code (other than "qualified 501(c)(3) bonds" as defined in Section 145 of the Code). Pursuant to the Sublease Agreement, it is contemplated that the Arena will be subleased for operation by the City to the Corporation, which is a corporation exempt from federal income tax pursuant to the provisions of Section 501(a) and 501(c)(3) of the Code, for which corporation a determination letter has been issued. (b) In accordance with Section 147(f) of the Code, the Authority held a public hearing on the issuance of the Series 1992 Bonds on August 3, 1992, after notice of hearing published on July 20, 1992 in the official newspaper of the Authority. (c) No more than 2% of the proceeds of the Series 1992 Bonds will be used to pay issuance expenses of the Series 1992 Bonds. (d) The average maturity of the Series 1992 Bonds does not exceed 120% of the expected economic life of the Arena. (e) None of the proceeds of the Series 1992 Bonds will be used for a purpose specified in Section 147(e) of the Code (as modified by Section 147(hx2) of the Code). (f) Issuance of the Series 1992 Bonds will not cause the $150,000,000 limitation on non - hospital bonds specified in Section 145(b) to be exceeded with respect to any 501(c)(3) organization which is a test -period beneficiary, including the Corporation. (g) None of the proceeds of the Series 1992 Bonds will be used to reimburse the Authority or any other Person for costs of the Arena paid prior to the date of issuance of the Series 1992 Bonds, provided that proceeds may be expended to reimburse architectural, engineering and other preliminary expenditures as defined in Section 1.103- 18(i)(2) of the Regulations to the extent specified therein and in accordance with the provisions of Section 1.103 -18 of the Regulations. -18- (h) The Series 1992 Bonds are not "hedge bonds" within the meaning of Section 149(8) of the Code. The Authority expects to spend not less than 85% of the spendable proceeds of the Series 1992 Bonds within three years after the date hereof and less than 50% of the proceeds of the Series 1992 Bonds are invested in nonpurpose investments having a substantially guaranteed yield for four years or more. (i) There are no other governmental obligations of the Authority: (i) issued at substantially the same time as the Series 1992 Bonds; (ii) sold pursuant to a common plan of financing with the Series 1992 Bonds; and (iii) paid out of substantially the same source of funds or which will have substantially the same claim to be paid out of substantially the same source of funds) as will be used to pay the Series 1992 Bonds. -19- ARTICLE VI MISCELLANEOUS PROVISIONS Section 6.1. Severability If any section, paragraph or provision of this resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this resolution. Section 6.2. Records and Certificates The officers of the Authority are hereby authorized and directed to prepare and furnish to the original purchaser of the Series 1992 Bonds, and to the attorneys approving the legality of the issuance of the Series 1992 Bonds, certified copies of all proceedings and records of the Authority relating to the Series 1992 Bonds and the financial condition and affairs of the Authority, and such other affidavits, certifications and information as are required to show the facts relating to the legality and marketability of the Series 1992 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 coupons, certifications and affidavits, including any heretofore furnished, shall be deemed representations of the Authority as to the facts related therein. Section 6.3. Covenant With Bondholders: Enforcement of Lease - Purchase Agreement Each and all of the terms and provisions of this Resolution shall be and constitute a covenant on the part of the Authority to and with each and every Holder from time to time of the Outstanding Bonds issued hereunder. The Authority will proceed with due diligence to enforce its rights under the Lease- Purchase Agreement for the benefit and security from time to time of the Holders of the Outstanding Bonds. In the event possession of the Arena is returned to the Authority upon termination of the Lease- Purchase Agreement for any reason, the Authority will use its best efforts to lease or sell the Arena for the benefit of the Holders of the Outstanding Bonds and will apply any funds received from any such action, net of reasonable expenses, to the payment of the principal of and interest on the Outstanding Bonds. Section 6.4. Amendments No change, amendment, modification or alteration shall be made in the covenants made with Holders of the Bonds without the consent of the Holders of not less than sixty percent (60%) in principal amount of then such Outstanding Bonds except for changes, amendments, modifications and alterations made (a) to cure any ambiguity or formal defect or omission, or (b) any other change which would not materially prejudice the holders of such Outstanding Bonds; provided, however, that nothing herein contained shall permit or be construed as permitting (1) an extension of the maturity of the principal of or the interest on any such Bonds, or (2) a reduction in the principal amount of any such Bond or the rate of interest thereon, or (3) a privilege or priority of any such Bond or Bonds over any other Bond or Bonds except as otherwise provided herein, or (4) a reduction in the aggregate principal amount of such Bonds required for consent to any change, amendment, modification or alteration, or (5) modify any of the provisions of this paragraph without the consent of the Holders of one hundred percent (100%) of the principal amount of Bonds Outstanding, or, in the case of any modifications described in clauses (1) through (4) the Holders of only those Outstanding Bonds adversely affected by the modifications. Section 6.5. Certificate of Registration The Secretary is hereby directed to file a certified copy of this Resolution with the County Auditor of Dakota Authority, Minnesota, together -20- with such other information as he or she shall require, and to obtain the County Auditor's certificate that the Series 1992 Bonds have been entered in the County Auditor's Bond Register. Section 6.6. Hradj=. Headings in this Resolution are included for convenience of reference only and are not a part hereof, and shall not limit or define the meaning of any provision hereof. Section 6.7. Applicable Law This Resolution shall be governed by and interpreted in accordance with the laws of the State of Minnesota The motion for the adoption of the foregoing resolution was duly seconded by Commissioner Ruhmann and, after fully discussion thereof and upon a vote being taken thereon, the following voted in favor thereof ALL PRESENT and the following voted against the same: NONE Whereupon said resolution was declared duly passed and adopted. -21-