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9.a Resolution 05-15-18-06 Awarding the sale of General Obligation Street Reconstruction Bonds Extract of Minutes of Meeting of the City Council of the City of Scandia, Minnesota Pursuant to due call and notice thereof, a regular meeting of the City Council of the City of Scandia, Minnesota, was duly held at City Hall in the City on Tuesday, May 15, 2018, 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 p roposal that had been received from Robert W. Baird & Co., Inc., Milwaukee, Wisconsin, for the purchase of the City’s $3,835,000 General Obligation Street Reconstruction Bonds, Series 2018A. After due consideration of the proposal, Councilmember __________________ then introduced the following resolution and moved its adoption: 2 RESOLUTION NO. 05-15-18-06 A RESOLUTION AWARDING THE SALE OF $3,835,000 GENERAL OBLIGATION STREET RECONSTRUCTION BONDS, SERIES 2018A; FIXING THEIR FORM AND SPECIFICATIONS; DIRECTING THEIR EXECUTION AND DELIVERY; AND PROVIDING FOR THEIR PAYMENT BE IT RESOLVED By the City Council (the “Council”) of the City of Scandia, Minnesota (the “City”) as follows: Section 1. Sale of Bonds. 1.01 Background; Findings. It is determined that: (a) On February 20, 2018, this Council held a duly noticed public hearing (the “Public Hearing”) on a proposed Five-Year Street Reconstruction Plan, 2018-2022 (the “Plan”), pursuant to Minnesota Statutes, Section 475.58, Subdivision 3b, as amended, for the purpose of considering the financing of reconstruction of streets within the City that are rated Poor and Very Poor under the City’s most recent Pavement Management Plan, conducted in 2008, including reclaiming existing streets, culvert replacement (as needed), minor ditching, and guard rail replacement (collectively, the “Project”). (b) The Public Hearing on February 20, 2018 covered consideration of the Plan and the preliminary issuance of general obligation street reconstruction bonds thereunder. This Council adopted the Plan and authorized the preliminary issuance of general obligation street reconstruction bonds thereunder pursuant to Resolution No. 02-20-18-03, adopted on February 20, 2018. (c) The City has received a proposal from Park Construction Company for construction of the Project, at a total cost of $3,732,404.50 (the “Project Costs”). The City is authorized to issue its general obligation street reconstruction bonds pursuant to Minnesota Statutes, Chapter 475, as amended (the “Act”), and more specifically, Section 475.58, Subdivision 3b of the Act, to finance all or a portion of the Project Costs, as well as costs of issuance of the underlying debt obligation. (d) The City proposes to finance a portion of the Project Costs through the issuance of its General Obligation Street Reconstruction Bonds, Series 2018A (the “Bonds”), in the total aggregate principal amount of $3,835,000.00. (e) It is necessary and expedient to the sound financial management of the affairs of the City for the City to issue the Bonds, pursuant to the Act, to provide financing for the costs of the Project Costs and the costs of issuance of the Bonds. The actions of City staff and legal counsel related to the sale of the Bonds are ratified and confirmed in all aspects. 1.02. Award to the Purchaser and Interest Rates. The proposal of Robert W. Baird & Co., Inc., Milwaukee, Wisconsin (the “Purchaser”) to purchase the Bonds described in the Notice of Sale thereof is found and determined to be a reasonable offer and is accepted, the proposal being to purchase the Bonds at a price of $3,847,771.05 (par amount of $3,835,000.00, less underwriter’s discount $46,874.00, less original issue discount of $5,404.15, plus reoffering premium of $65,049.20), for Bonds bearing interest as follows: 3 Year Interest Rate Year Interest Rate 2019 3.000% 2027 3.000% 2020 3.000% 2028 3.000% 2021 3.000% 2029 3.000% 2022 3.000% 2030 3.000% 2023 3.000% 2031 3.000% 2024 3.000% 2032 3.125% 2025 3.000% 2033 3.125% 2026 3.000% 1.03. Purchase Contract. The Mayor and the City Administrator are authorized and directed to execute a contract with the Purchaser on behalf of the City. 1.04. Terms and Principal Amounts of the Bonds. The City will forthwith issue and sell the Bonds pursuant to the Act in the total principal amount of $3,835,000.00, originally dated June 15, 2018, numbered R-1, upward, bearing interest as above set forth, and maturing serially on December 15 in the years and amounts as follows: Year Amount Year Amount 2019 $155,000.00 2027 $265,000.00 2020 $215,000.00 2028 $275,000.00 2021 $220,000.00 2029 $280,000.00 2022 $230,000.00 2030 $290,000.00 2023 $235,000.00 2031 $300,000.00 2024 $245,000.00 2032 $305,000.00 2025 $250,000.00 2033 $315,000.00 2026 $255,000.00 1.05. Optional Redemption. The City may elect on December 15, 2025, and on any date thereafter to prepay Bonds due on or after December 15, 2026. 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 7 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. Section 2. Registration and Payment. 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 4 of the date of original issue. The interest on the Bonds is payable on June 15 and December 15 of each year, commencing June 15, 2019 to the registered owners of record as of the close of business on the first day of the month of the interest payment date, whether or not that day is a business day. 2.03. Registration. The City will appoint a bond registrar, transfer agent, authenticating agent and paying agent for the Bonds (the “Registrar”). The effect of registration and the rights and duties of the City and the Registrar with respect thereto are as follows: (a) Register. 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 form satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorize d 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 first day of the month of the 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 any 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 certificate 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 Bonds 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 5 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 certificate 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 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 the proceedings 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 Registrar. The City appoints Northland Trust Services, Incorporated, Minneapolis, Minnesota, as the initial Registrar for the Bonds. The Mayor and the City Administrator 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 City Administrator must transmit to the Registrar money sufficient for the payment of all principal and interest then due. 2.05. Execution, Authentication and Delivery. The Bonds will be prepared under the direction of the City Administrator and executed on behalf of the City by the signatures of the Mayor and the City Administrator, provided that all 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 any Bonds, 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 Administrator 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 Section 3 hereof. Upon the execution and delivery of the definitive Bonds the temporary Bonds will be exchanged therefor and cancelled. 6 Section 3. Form of Bonds. 3.01. Form. The Bonds will be printed or typewritten in substantially the form as attached hereto as Exhibit A. 3.02. Approving Legal Opinion. The City Administrator is authorized and directed to obtain a copy of the proposed approving legal opinion of Eckberg Lammers, P.C., Stillwater, Minnesota, Bond Counsel to the City, which is to be complete except as to dating thereof and cause the opinion to be printed on or accompany each Bonds. Section 4. Payment; Security; Pledges and Covenants. 4.01. Funds and Accounts. (a) Debt Service Fund. The Bonds are payable from the General Obligation Street Reconstruction Bonds, Series 2018A Debt Service Fund (the “Debt Service Fund”) created herein, 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 Bonds becomes due when there is not sufficient money in the Debt Service Fund to pay the same, the City Administrator will 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. (b) Project Construction Fund. The proceeds of the Bonds, less costs of issuance thereof, together with any reoffering premium utilized for such purpose and any other funds appropriated by the City during the construction of the Project, will be deposited in a separate construction fund (the “Construction Fund”) to be used solely to defray expenses of the Project. Any balance remaining in the Construction Fund after completion of the Project may be used to pay the cost in whole or in part of any other improvement instituted under the Act under the direction of this Council. When the Project is completed and the cost thereof paid, the Construction Fund is to be closed and subsequent collections of taxes for the Project are to be deposited in the Debt Service Fund. 4.02. Pledge of Taxes. For the purpose of paying the principal of and interest on the Bonds, there is levied a direct annual irrepealable ad valorem tax upon all of the taxable property in the City, which tax will be spread upon the tax rolls and collected with and as part of other general taxes of the City. Such tax will be credited to the Debt Service Fund above provided and will be in the years and amounts (year stated being year of collection) attached hereto as Exhibit B. 4.03. Certification to County Auditor as to Debt Service Fund Amount. As required by Section 475.61 of the Act, it is determined that the estimated collection of the foregoing taxes will produce at least five percent (5%) in excess of the amount needed to meet when due the principal and interest payments on the Bonds. The tax levy herein provided is irrepealable until all of the Bonds are paid, provided that at the time the City makes its annual tax levies, the City Administrator may certify to the Washington County Auditor-Treasurer the amount available in the Debt Service Fund to pay principal and interest due during the ensuing year, and the County Auditor-Treasurer will thereupon reduce the levy collectible during such year by the amount so certified, as provided by Section 475.61, Subdivision 3 of the Act. 4.04. Certificate as to Registration. The City Administrator is authorized and directed to file a certified copy of this Resolution with the Washington County Auditor-Treasurer and to obtain the certificate required by Section 475.63 of the Act. 7 4.05. Reimbursement Intent. This Resolution is intended to serve as an “official intent” of the City to comply with the reimbursement bond requirements set forth in United States Treasury Regulations, Section 1.150-2, as amended. Section 5. Authentication of Transcript. 5.01. 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, will be deemed representations of the City as to the facts stated therein. The Mayor and the City Administrator are authorized and directed to furnish to the Purchaser at closing on the Bonds 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 closing the Mayor and the City Administrator shall also execute and deliver to the Purchaser a suitable certificate as to the absence of material litigation, and the City Administrator shall also execute and deliver a certificate as to payment for and delivery of the Bonds. 5.02. Certification as to Official Statement. The Mayor and the City Administrator are 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. 5.03. Payment of Costs of Issuance. The City authorizes the Purchaser to forward the amount of Bond proceeds allocable to the payment of costs of issuance of the Bonds to the Registrar on the closing date of the Bonds for further distribution as directed by the City’s municipal advisor, Northland Securities, Inc. Section 6. Tax Covenants. 6.01. 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 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 Bonds. 6.02. No Rebate Required. 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 obligations (other than private activity bonds) issued by the City (and all subordinate entities of the City) during the calendar year in which the Bonds are issued and outstanding at one time is not reasonably expected to exceed $5,000,000, all within the meaning of Section 148(f)(4)(D) of the Code. 6.03. Not Private Activity 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. 8 6.04. Qualified Tax-Exempt Obligations. 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 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 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 2018 will not exceed $10,000,000; and (d) not more than $10,000,000 of obligations issued by the City during calendar year 2018 have been designated for purposes of Section 265(b)(3) of the Code. 6.05. 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 7. Book-Entry System; Limited Obligation of City. 7.01. DTC. 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 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. 7.02. 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 and the Registrar 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 and the Registrar 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, if any, and interest with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purp oses. The Registrar 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 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 Administrator 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 Administrator will promptly deliver a copy of the same to the Registrar. 9 7.03. Representation Letter. The City has heretofore executed and delivered to DTC a Blanket Issuer Letter of Representations (the “Representation Letter”) which will govern payment of principal of, premium, if any, and interest on the Bonds and notices with respect to the Bonds. Any 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 to be complied with at all times. 7.04. Transfers Outside Book-Entry System. In the event the City, by resolution of this 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 owner 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. 7.05. 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 Bonds and all notices with respect to the Bonds will be made and given, respectively, in the manner provided in DTC’s Operational Arrangements, as set forth in the Representation Letter. Section 8. Continuing Disclosure. 8.01. Execution of Continuing Disclosure Certificate. “Continuing Disclosure Certificate” means that certain Continuing Disclosure Certificate executed by the Mayor and the City Administrator 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. 8.02. City Compliance with Provisions of Continuing Disclosure Certificate. The City 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 will not 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. Section 9. 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 Purchaser on or before that date a sum 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 Purchaser a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit. 10 Passed and adopted by the City Council of the City of Scandia, Minnesota this 15th day of May, 2018. CITY OF SCANDIA, MINNESOTA ____________________________________ Christine Maefsky, Mayor Attest: ____________________________________ Neil Soltis, City Administrator 11 The motion for the adoption of the foregoing resolution was duly seconded by Councilmember ____________________, and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon the resolution was declared duly passed and adopted. STATE OF MINNESOTA ) ) COUNTY OF WASHINGTON ) SS. ) CITY OF SCANDIA ) I, the undersigned, being the duly qualified and acting Administrator of the City of Scandia, Minnesota, certify that I have carefully compared the attached and foregoing extract of minutes of a regular meeting of the City Council of the City held on May 15, 2018 with the original minutes on file in my office and the extract is a full, true and correct copy of the minutes insofar as they relate to the issuance and sale of the City’s General Obligation Street Reconstruction Bonds, Series 2018A, in the aggregate principal amount of $3,835,000. WITNESS My hand officially as such Administrator and the corporate seal of the City this ______ day of _______________, 2018. City Administrator City of Scandia, Minnesota (SEAL) A-1 EXHIBIT A FORM OF BONDS No. R-___ UNITED STATES OF AMERICA $_________ STATE OF MINNESOTA COUNTY OF WASHINGTON CITY OF SCANDIA GENERAL OBLIGATION STREET RECONSTRUCTION BOND, SERIES 2018A Rate Maturity Date of Original Issue CUSIP December 15, 20__ June 15, 2018 _______ Registered Owner: Cede & Co. The City of Scandia, Minnesota, a duly organized and existing municipal corporation and political subdivision located in Washington 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 June 15 and December 15 in each year, commencing June 15, 2019, to the person in whose name this Bond is registered at the close of business on the first day (whether or not a business day) of the calendar month of such interest payment date. 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 Northland Trust Services, Inc., 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 December 15, 2025, and on any date thereafter to prepay Bonds due on or after December 15, 2026. 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 The Depository Trust Company, New York, New York (“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 City Council of the City 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 $10 million limit allowed by the Code for the calendar year of issue. A-2 This Bond is one of an issue in the aggregate principal amount of $3,835,000, all of like original issue date and tenor, except as to number, maturity date, redemption privilege, and interest rate, issued pursuant to a resolution adopted by the City Council of the City on May 15, 2018 (the “Resolution”), for the purpose of financing the reconstruction of streets within the City as provided within the City’s Five- Year Street Reconstruction Plan, 2018-2022 (the “Project”), pursuant to and in full conformity with the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Chapter 475, and Section 475.58, Subdivision 3b, as amended. The principal hereof and interest hereon are payable from ad valorem taxes imposed on all taxable property in the City, 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 of the City has obligated itself to levy additional ad valorem taxes on all taxable property in the City in the event of any deficiency, 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 transfer or 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 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 or statutory limitation of indebtedness. 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. A-3 IN WITNESS WHEREOF, the City of Scandia, 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 the City Administrator and has caused this Bond to be dated as of the date set forth below. Dated: ____________________ CITY OF SCANDIA, MINNESOTA (Facsimile) (Facsimile) Mayor City Administrator CERTIFICATE OF AUTHENTICATION This is one of the Bonds delivered pursuant to the Resolution mentioned within. NORTHLAND TRUST SERVICES, INC. By Authorized Representative ______________________________________ 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 UNIF GIFT MIN ACT _________ Custodian _________ in common (Cust) (Minor) TEN ENT -- as tenants under Uniform Gifts or by entireties Transfers to Minors JT TEN -- as joint tenants with right of survivorship and Act . . . . . . . . . . . . not as tenants in common (State) Additional abbreviations may also be used though not in the above list. _______________________________________ A-4 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 A-5 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 Registrar June 15, 2018 Cede & Co. Federal ID #13-2555119 EXHIBIT B TAX LEVY SCHEDULE Year of Tax Levy Year of Tax Collection Amount 2018 2019 $345,174.38 2019 2020 $342,483.75 2020 2021 $340,961.25 2021 2022 $344,531.25 2022 2023 $342,536.25 2023 2024 $345,633.75 2024 2025 $343,166.25 2025 2026 $340,541.25 2026 2027 $343,008.75 2027 2028 $345,161.25 2028 2029 $341,748.75 2029 2030 $343,428.75 2030 2031 $344,793.75 2031 2032 $340,593.75 2032 2033 $341,085.95