RES 18-34EXTRACT OF MINUTES OF A MEETING
OF THE CITY COUNCIL
CITY OF OTSEGO, MINNESOTA
HELD: MAY 14, 2018
Pursuant to due call and notice thereof, a regular or special meeting of the City Council
of the City of Otsego, Wright County, Minnesota, was duly held at the City Hall on May 14,
2018, at 7:00 P.M. for the purpose in part of authorizing the competitive negotiated sale of the
$2,550,000 General Obligation Improvement Bonds, Series 2018A.
The following members were present: Stockamp, Heidner, Tanner, Warehime
and the following were absent: Darkenwald
Member Tanner introduced the following resolution and moved its adoption:
RESOLUTION 2018-34
RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2018A
A. WHEREAS, the City Council of the City of Otsego, Minnesota (the "City"), has
heretofore determined that it is necessary and expedient to issue General Obligation
Improvement Bonds, Series 2018A (the 'Bonds") to finance various improvement projects in the
City; and
B. WHEREAS, the City has retained Northland Securities, Inc., in Minneapolis,
Minnesota ("Northland"), as its independent municipal advisor and is therefore authorized to sell
the Bonds by competitive negotiated sale in accordance with Minnesota Statutes, Section 475.60,
Subdivision 2(9); and
C. WHEREAS, the City has retained Briggs and Morgan, Professional Association,
in Minneapolis, Minnesota as its bond counsel for purposes of this financing.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Otsego,
Minnesota, as follows:
1. Authorization. The City Council hereby authorizes Northland to solicit proposals
for the competitive negotiated sale of the Bonds.
2. Meeting; Proposal Opening. The City Council shall meet at the time and place
specified in the Notice of Sale, in substantially the form attached hereto as Exhibit A, for the
purpose of considering sealed proposals for and awarding the sale of the Bonds. The City
Administrator/Finance Director, or designee, shall open proposals at the time and place specified
in the Notice of Sale.
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3. Notice of Sale. The terms and conditions of the Bonds and the negotiation thereof
are in substantially in the form set forth in the Notice of Sale attached hereto as Exhibit A and
hereby approved and made a part hereof.
4. Official Statement. In connection with the competitive negotiated sale of the
Bonds, the City Administrator/Finance Director and other officers or employees of the City are
hereby authorized to cooperate with Northland and participate in the preparation of an official
statement for the Bonds, and to execute and deliver it on behalf of the City upon its completion.
The motion for the adoption of the foregoing resolution was duly seconded by member
Warehime and, after full discussion thereof and upon a vote being taken thereon, the following
voted in favor thereof. Stockamp, Heidner, Tanner, Warehime
and the following voted against the same: None
Whereupon the resolution was declared duly passed and adopted.
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STATE OF MINNESOTA
COUNTY OF WRIGHT
CITY OF OTSEGO
I, the undersigned, being the duly qualified and acting City Administrator/Finance
Director of the City of Otsego, Minnesota, DO HEREBY CERTIFY that I have compared the
attached and foregoing extract of minutes with the original thereof on file in my office, and that
the same is a full, true and complete transcript of the minutes of a meeting of the City Council
duly called and held on the date therein indicated, insofar as such minutes relate to the City's
$2,550,000 General Obligation Improvement Bonds, Series 2018A.
WITNESS my hand on May 14, 2018,
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City Administrator/Finance Director
EXHIBIT A
NOTICE OF SALE
$2,550,000*
GENERAL OBLIGATION IMPROVEMENT BONDS, SERIES 2018A
CITY OF OTSEGO, MINNESOTA
(Book-Entiy Only)
NOTICE IS HEREBY GIVEN that these Bonds will be offered for sale according to the following terms:
TIME AND PLACE:
Proposals (also referred to herein as "bids") will be opened by the City's Administrator, or designee, on
Monday, June 11, 2018, at 10:30 A.M., CT, at the offices of Northland Securities, Inc. (the City's "Municipal
Advisor"), 150 South 5th Street, Suite 3300, Minneapolis, Minnesota 55402. Consideration of the Proposals
for award of the sale will be by the City Council at its meeting at the City Offices beginning Monday, June 11,
2018, at 7:00 P.M., CT.
SUBMISSION OF PROPOSALS
Proposals may be:
a) submitted to the office of Northland Securities, Inc.,
b) faxed to Northland Securities, Inc. at 612-851-5918,
c) for proposals submitted prior to the sale, the final price and coupon rates may be submitted to Northland
Securities, Inc. by telephone at 612-851-5900 or 612-851-5915, or
d) submitted electronically.
Notice is hereby given that electronic proposals will be received via PARITYT"', or its successor, in the manner
described below, until 10:30 A.M., CT, on Monday, June 11, 2018. Proposals may be submitted electronically
via PARITYT" or its successor, pursuant to this Notice until 10:30 A.M., CT, but no Proposal will be received
after the time for receiving Proposals specified above. To the extent any instructions or directions set forth in
PARITYm, or its successor, conflict with this Notice, the terms of this Notice shall control. For further
information about PARITY"', or its successor, potential bidders may contact Northland Securities, Inc. or i -
Deal® at 1359 Broadway, 2nd floor, New York, NY 10018, telephone 212-849-5021
Neither the City nor Northland Securities, Inc, assumes any liability if there is a malfunction of PARITY"' or
its successor. All bidders are advised that each Proposal shall be deemed to constitute a contract between the
bidder and the City to purchase the Bonds regardless of the manner in which the Proposal is submitted.
BOOK -ENTRY SYSTEM
The Bonds will be issued by means of a book -entry system with no physical distribution of bond certificates
made to the public. The Bonds will be issued in fully registered form and one bond certificate, representing the
aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co.
as nominee of Depository Trust Company ("DTC"), New York, New York, which will act as securities
depository of the Bonds.
*The City reserves the right to increase or decrease the principal amount of the Bonds. Any such increase or decrease will be
made in multiples of $5,000 and may be made in any maturity. If any maturity is adjusted, the purchase price will also be
adjusted to maintain the same gross spread.
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Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a
single maturity through book entries made on the books and records of DTC and its participants. Principal and
interest are payable by the City through Northland Trust Services, Inc. Minneapolis, Minnesota (the "Paying
Agent/Registrar"), to DTC, or its nominee as registered owner of the Bonds. Transfer of principal and interest
payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments
to beneficial owners by participants will be the responsibility of such participants and other nominees of
beneficial owners. The successful bidder, as a condition of delivery of the Bonds, will be required to deposit
the bond certificates with DTC. The City will pay reasonable and customary charges for the services of the
Paying Agent/Registrar.
DATE OF ORIGINAL ISSUE OF BONDS
Date of Delivery (Estimated to be July 11, 2018)
AUTHORITY/PURPOSE/SECURITY
The Bonds are being issued pursuant to Minnesota Statutes, Chapters 429 and 475. Proceeds will be used to
finance the Kadler Avenue and Mississippi Shores improvement projects. The Bonds are payable from special
assessments against benefited property, and additionally secured by ad valorem taxes on all taxable property
within the City. The full faith and credit of the City is pledged to their payment and the City has validly
obligated itself to levy ad valorem taxes in the event of any deficiency in the debt service account established
for this issue.
INTEREST PAYMENTS
Interest is due semiannually on each February 1 and August 1, commencing February 1, 2019, to registered
owners of the Bonds appearing of record in the Bond Register as of the close of business on the fifteenth day
(whether or not a business day) of the calendar month preceding such interest payment date.
MATURITIES
Principal is due annually on February 1, inclusive, in each of the years and amounts as follows:
Year
Amount
Year
Amount
Year
Amount
2020
$195,000
2025
$215,000
2030
$75,000
2021
195,000
2026
220,000
2031
80,000
2022
205,000
2027
225,000
2032
80,000
2023
205,000
2028
235,000
2033
85,000
2024
210,000
2029
240,000
2034
85,000
Proposals for the Bonds may contain a maturity schedule providing for any combination of serial bonds and
term bonds, subject to mandatory redemption, so long as the amount of principal maturing or subject to
mandatory redemption in each year conforms to the maturity schedule set forth above.
INTEREST RATES
All rates must be in integral multiples of 1/20th or 1/8th of 1%. Rates nnrst be in level or ascending order. All
Bonds of the same maturity must bear a single uniform rate from date of issue to maturity.
ESTABLISHMENT OF ISSUE PRICE
(HOLD -THE -OFFERING -PRICE RULE MAY APPLY — BIDS NOT CANCELLABLE)
The winning bidder shall assist the City in establishing the issue price of the Bonds and shall execute and
deliver to the City at closing an "issue price" or similar certificate setting forth the reasonably expected initial
offering price to the public or the sales price or prices of the Bonds, together with the supporting pricing wires
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or equivalent communications, substantially in the form attached hereto as Exhibit A, with such modifications
as may be appropriate or necessary, in the reasonable judgment of the winning bidder, the City and Bond
Counsel. All actions to be taken by the City under this Notice of Sale to establish the issue price of the Bonds
may be taken on behalf of the City by the City's Municipal Advisor and any notice or report to be provided to
the City may be provided to the City's Municipal Advisor.
The City intends that the provisions of Treasury Regulation Section 1.148-1(f)(3)(i) (defining "competitive
sale" for purposes of establishing the issue price of the Bonds) will apply to the initial sale of the Bonds (the
"competitive sale requirements") because:
(1) the City shall disseminate this Notice of Sale to potential underwriters in a manner that is reasonably
designed to reach potential underwriters;
(2) all bidders shall have an equal opportunity to bid;
(3) the City may receive bids from at least three underwriters of municipal bonds who have established
industry reputations for underwriting new issuances of municipal bonds; and
(4) the City anticipates awarding the sale of the Bonds to the bidder who submits a firm offer to purchase
the Bonds at the highest price (or lowest cost), as set forth in this Notice of Sale.
Any bid submitted pursuant to this Notice of Sale shall be considered a firm offer for the purchase of the
Bonds, as specified in the bid.
In the event that the competitive sale requirements are not satisfied, the City shall promptly so advise the
winning bidder. The City may then determine to treat the initial offering price to the public as of the award
date of the Bonds as the issue price of each maturity by imposing on the winning bidder the Hold -the -Offering -
Price Rule as described in the following paragraph (the "Hold -the -Offering -Price Rule"). Bids will not be
subject to cancellation in the event that the City determines to apply the Hold -the -Offering -Price Rule to the
Bonds. Bidders should prepare their bids on the assumption that the Bonds will be subject to the Hold -
the -Offering -Price Rule in order to establish the issue price of the Bonds.
By submitting a bid, the winning bidder shall (i) confirm that the underwriters have offered or will offer the
Bonds to the public on or before the date of award at the offering price or prices (the "Initial Offering Price"),
or at the corresponding yield or yields, set forth in the bid submitted by the winning bidder and (ii) agree, on
behalf of the underwriters participating in the purchase of the Bonds, that the underwriters will neither offer
nor sell unsold Bonds of any maturity to which the Hold -the -Offering Price Rule shall apply to any person at a
price that is higher than the Initial Offering Price to the public during the period starting on the award date for
the Bonds and ending on the earlier of the following:
(1) the close of the fifth (5t business day after the award date; or
(2) the date on which the underwriters have sold at least 10% of a maturity of the Bonds to the public at a
price that is no higher than the Initial Offering Price to the public (the "10% Test"), at which time only
that particular maturity will no longer be subject to the Hold -the -Offering -Price Rule.
The City acknowledges that, in making the representation set forth above, the winning bidder will rely on (i)
the agreement of each underwriter to comply with the Hold -the -Offering -Price Rule, as set forth in an
agreement among underwriters and the related pricing wires, (ii) in the event a selling group has been created
in connection with the initial sale of the Bonds to the public, the agreement of each dealer who is a member of
the selling group to comply with the Hold -the -Offering -Price Rule, as set forth in a selling group agreement
and the related pricing wires, and (iii) in the event that an underwriter is a party to a retail distribution
agreement that was employed in connection with the initial sale of the Bonds to the public, the agreement of
each broker-dealer that is a party to such agreement to comply with the Hold -the -Offering -Price Rule, as set
forth in the retail distribution agreement and the related pricing wires. The City further acknowledges that
each underwriter shall be solely liable for its failure to comply with its agreement regarding the Hold -the -
Offering -Price Rule and that no underwriter shall be liable for the failure of any other underwriter, or of any
dealer who is a member of a selling group, or of any broker-dealer that is a party to a retail distribution
agreement to comply with its corresponding agreement regarding the Hold -the -Offering -Price Rule as
applicable to the Bonds.
By submitting a bid, each bidder confirms that: (i) any agreement among underwriters, any selling group
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agreement and each retail distribution agreement (to which the bidder is a party) relating to the initial sale of
the Bonds to the public, together with the related pricing wires, contains or will contain language obligating
each underwriter, each dealer who is a member of the selling group, and each broker-dealer that is a party to
such retail distribution agreement, as applicable, to comply with the Hold -the -Offering -Price Rule, if
applicable, in each case if and for so long as directed by the winning bidder and as set forth in the related
pricing wires, and (ii) any agreement among underwriters relating to the initial sale of the Bonds to the public,
together with the related pricing wires, contains or will contain language obligating each underwriter that is a
party to a retail distribution agreement to be employed in connection with the initial sale of the Bonds to the
public to require each broker-dealer that is a party to such retail distribution agreement to comply with the
Hold -the -Offering -Price Rule, if applicable, in each case if and for so long as directed by the winning bidder or
such underwriter and as set forth in the related pricing wires.
Notes: Sales of any Bonds to any person that is a related party to an underwriter shall not constitute sales to
the public for purposes of this Notice of Sale. Further, for pan poses of this Notice of Sale:
(1) "public" means any person other than an underwriter or a related party,
(2) "underwriter" paeans (A) any person that agrees pursuant to a written contract with the Cite (or with
the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds
to the public and (B) any person that agrees pursuant to a written contract directly or indirectly with
a person described in clause (A) to participate in the initial sale of the Bonds to the public (including
a member of a selling group or a party to a retail distribution agreement participating in the initial
sale of the Bonds to the public).
(3) a purchaser of any of the Bonds is a "related party" to an underwriter if the underwriter and the
purchaser are subject, directly or indirectly, to (i) at least 50% common ownership of the voting
power or the total value of their stock, if both entities are corporations (including direct ownership by
one corporation or another), (ii) more than 50% common ownership of their capital interests or
profits interests, if both entities are partnerships (including direct ownership by one partnership of
another), or (iii) more than 50% common ownership of the value of the outstanding stock of the
corporation or the capital interests or profit interests of the partnership, as applicable, if one entity is
a corporation and the other entity is a partnership (including direct ownership of the applicable stock
or interests by one entity) of the other), and
(4) "sale date" paeans the date that the Bonds are awarded by the City to the winning bidder.
ADJUSTMENTS TO PRINCIPAL AMOUNT AFTER PROPOSALS
The City reserves the right to increase or decrease the principal amount of the Bonds. Any such increase or
decrease will be made in multiples of $5,000 and may be made in any maturity. If any maturity is adjusted, the
purchase price will also be adjusted to maintain the same gross spread. Such adjustments shall be made
promptly after the sale and prior to the award of Proposals by the City and shall be at the sole discretion of the
City. The successful bidder may not withdraw or modify its Proposal once submitted to the City for any
reason, including post -sale adjustment. Any adjustment shall be conclusive and shall be binding upon the
successful bidder.
OPTIONAL REDEMPTION
Bonds maturing on February 1, 2027 through 2034 are subject to redemption and prepayment at the option of
the City on February 1, 2026 and any date thereafter, at a price of par plus accrued interest. Redemption may
be in whole or in part of the Bonds subject to prepayment. If redemption is in part, the maturities and principal
amounts within each maturity to be redeemed shall be determined by the City and if only part of the Bonds
having a common maturity date are called for prepayment, the specific Bonds to be prepaid shall be chosen by
lot by the Bond Registrar.
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CUSIP NUMBERS
If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither
the failure to print such numbers on any Bond nor any error with respect thereto shall constitute cause for a
failure or refusal by the successful bidder thereof to accept delivery of and pay for the Bonds in accordance
with terms of the purchase contract. The CUSIP Service Bureau charge for the assigmnent of CUSIP
identification numbers shall be paid by the successful bidder.
DELIVERY
Delivery of the Bonds will be within forty days after award, subject to an approving legal opinion by Briggs
and Morgan, Professional Association, Bond Counsel. The legal opinion will be paid by the City and delivery
will be anywhere in the continental United States without cost to the successful bidder at DTC.
TYPE OF PROPOSAL
Proposals of not less than $2,527,050 (99.10%) and accrued interest on the principal sum of $2,550,000 must
be filed with the undersigned prior to the time of sale. Proposals must be unconditional except as to legality.
Proposals for the Bonds should be delivered to Northland Securities, Inc. and addressed to:
Adam Flaherty, City Administrator
13400 90 St. NE
Otsego, Minnesota 55330
A good faith deposit (the "Deposit") in the amount of $51,000 in the form of a federal wire transfer (payable to
the order of the City) is only required from the apparent winningbidder, idder, and must be received within two
hours after the time stated for the receipt of Proposals. The apparent winning bidder will receive notification
of the wire instructions from the Municipal Advisor promptly after the sale. If the Deposit is not received from
the apparent winning bidder in the time allotted, the City may choose to reject their Proposal and then proceed
to offer the Bonds to the next lowest bidder based on the terms of their original proposal, so long as said bidder
wires funds for the Deposit amount within two hours of said offer.
The City will retain the Deposit of the successful bidder, the amount of which will be deducted at settlement
and no interest will accrue to the successful bidder. In the event the successful bidder fails to comply with the
accepted Proposal, said amount will be retained by the City. No Proposal can be withdrawn after the time set
for receiving Proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed,
or continued to another date without award of the Bonds having been made.
AWARD
The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost
(TIC) basis. The City's computation of the interest rate of each Proposal, in accordance with customary
practice, will be controlling. In the event of a tie, the sale of the Bonds will be awarded by lot. The City will
reserve the right to: (i) waive non -substantive informalities of any Proposal or of matters relating to the receipt
of Proposals and award of the Bonds, (ii) reject all Proposals without cause, and (iii) reject any Proposal which
the City determines to have failed to comply with the terms herein.
INFORMATION FROM SUCCESSFUL BIDDER
The successful bidder will be required to provide, in a timely manner, certain information relating to the initial
offering price of the Bonds necessary to compute the yield on the Bonds pursuant to the provisions of the
Internal Revenue Code of 1986, as amended.
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OFFICIAL STATEMENT
By awarding the Bonds to any underwriter or underwriting syndicate submitting a Proposal therefor, the City
agrees that, no more than seven business days after the date of such award, it shall provide to the senior
managing underwriter of the syndicate to which the Bonds are awarded, the Final Official Statement in an
electronic format as prescribed by the Municipal Securities Rulemaking Board (MSRB).
FULL CONTINUING DISCLOSURE UNDERTAKING
The City will covenant in the resolution awarding the sale of the Bonds and in a Continuing Disclosure
Undertaking to provide, or cause to be provided, annual financial information, including audited financial
statements of the City, and notices of certain material events, as required by SEC Rule 15c2-12.
BANK QUALIFICATION
The City will designate the Bonds as qualified tax-exempt obligations for purposes of Section 265(b)(3) of the
Internal Revenue Code of 1986, as amended.
BOND INSURANCE AT UNDERWRITER'S OPTION
If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the
option of the successful bidder, the purchase of any such insurance policy or the issuance of any such
commitment shall be at the sole option and expense of the successful bidder of the Bonds. Any increase in the
costs of issuance of the Bonds resulting from such purchase of insurance shall be paid by the successful bidder,
except that, if the City has requested and received a rating on the Bonds from a rating agency, the City will pay
that rating fee. Any other rating agency fees shall be the responsibility of the successful bidder. Failure of the
municipal bond insurer to issue the policy after the Bonds have been awarded to the successful bidder shall not
constitute cause for failure or refusal by the successful bidder to accept delivery on the Bonds.
The City reserves the right to reject any and all Proposals, to waive informalities and to adjourn the sale.
Dated: May 14, 2018 BY ORDER OF THE OTSEGO CITY COUNCIL
/s/ Adam Flaherty
City Administrator
Additional information may be obtained from:
Northland Securities, Inc.
150 South 5th Street, Suite 3300
Minneapolis, Minnesota 55402
Telephone No.: 612-851-5900
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EXHIBIT A — FORM OF ISSUE PRICE CERTIFICATES
[COMPETITIVE SALE SATISFIED]
The undersigned, on behalf of
certifies as set forth below with respect to the sale of the General
2018A (the "Bonds") of the City of Otsego, Minnesota (the "Issuer").
Reasonably Expected Initial Offering Price.
(the "Underwriter"), hereby
Obligation Improvement Bonds, Series
(a) As of the Sale Date, the reasonably expected initial offering prices of the Bonds to the Public
by the Underwriter are the prices listed in Schedule A (the "Expected Offering Prices"). The Expected
Offering Prices are the prices for the Maturities of the Bonds used by the Underwriter in formulating its bid to
purchase the Bonds. Attached as Schedule B is a true and correct copy of the bid provided by the Underwriter
to purchase the Bonds.
bid.
(b) The Underwriter was not given the opportunity to review other bids prior to submitting its
(c) The bid submitted by the Underwriter constituted a firm offer to purchase the Bonds.
2. Defined Terms.
(a) "Maturity" means Bonds with the same credit and payment terms. Bonds with different
maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate
Maturities.
(b) "Public" means any person (including an individual, trust, estate, partnership, association,
company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related
party" for purposes of this certificate generally means any two or more persons who have greater than 50
percent common ownership, directly or indirectly.
(c) "Sale Date" means the first day on which there is a binding contract in writing for the sale of
a Maturity of the Bonds. The Sale Date of the Bonds is
(d) "Underwriter" means (i) any person that agrees pursuant to a written contract with the Issuer
(or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to
the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person
described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a
member of a selling group or a party to a retail distribution agreement participating in the initial sale of the
Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only. Nothing in this
certificate represents the Underwriter's interpretation of any laws, including specifically Sections 103 and 148
of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned
understands that the foregoing information will be relied upon by the Issuer with respect to certain of the
representations set forth in the Nonarbitrage Certificate and with respect to compliance with the federal income
tax rules affecting the Bonds, and by Briggs and Morgan, Professional Association, Bond Counsel in
connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal
income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income
tax advice that it may give to the Issuer from time to time relating to the Bonds.
Cil
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[HOLD -THE -OFFERING -PRICE RULE]
The undersigned, on behalf of (the "Underwriter"), on behalf
of itself and (together, the "Underwriting Group"), hereby certifies as set forth
below with respect to the sale and issuance of General Obligation Improvement Bonds, Series 2018A (the
"Bonds") of the City of Otsego, Minnesota (the "Issuer").
Initial Offering Price of the Bonds.
(a) The Underwriter [The Underwriting Group] offered each Maturity of the Bonds to the Public
for purchase at the respective initial offering prices listed in Schedule A (the "Initial Offering Prices") on or
before the Sale Date. A copy of the pricing wire or equivalent communication for the Bonds is attached to this
certificate as Schedule B.
(b) As set forth in the Notice of Sale and bid award, the Underwriter [the members of the
Underwriting Group] [has][have] agreed in writing that, (i) for each Maturity of the Bonds, [it][they] would
neither offer nor sell any of the Bonds of such Maturity to any person at a price that is higher than the Initial
Offering Price for such Maturity during the Holding Period for such Maturity (the "hold -the -offering -price
rule"), and (ii) any selling group agreement shall contain the agreement of each dealer who is a member of the
selling group, and any retail distribution agreement shall contain the agreement of each broker-dealer who is a
party to the retail distribution agreement, to comply with the hold -the -offering -price rule. Pursuant to such
agreement, no Underwriter (as defined below) has offered or sold any Maturity of the Bonds at a price that is
higher than the respective Initial Offering Price for that Maturity of the Bonds during the Holding Period.
2. Defined Terms.
(a) "Holding Period" means, for each Maturity of the Bonds, the period starting on the Sale Date
and ending on the earlier of (i) the close of the fifth business day after the Sale Date ( ), or
(ii) the date on which the Underwriter [the Underwriters] [has] [have] sold at least 10% of such Maturity of the
Bonds to the Public at prices that are no higher than the Initial Offering Price for such Maturity.
(b) "Maturity" means Bonds with the same credit and payment terms. Bonds with different
maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate
Maturities.
(c) "Public" means any person (including an individual, trust, estate, partnership, association,
company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related
party" for purposes of this certificate generally means any two or more persons who have greater than 50
percent common ownership, directly or indirectly.
(d) "Sale Date" means the first day on which there is a binding contract in writing for the sale of
a Maturity of the Bonds. The Sale Date of the Bonds is , 2018.
(e) "Underwriter" means (i) any person that agrees pursuant to a written contract with the Issuer
(or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to
the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person
described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a
member of a selling group or a party to a retail distribution agreement participating in the initial sale of the
Bonds to the Public).
The representations set forth in this certificate are limited to factual matters only. Nothing in this
certificate represents the Representative's interpretation of any laws, including specifically Sections 103 and
148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The
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undersigned understands that the foregoing information will be relied upon by the Issuer [and the Borrower]
with respect to certain of the representations set forth in the Nonarbitrage Certificate and with respect to
compliance with the federal income tax rules affecting the Bonds, and by Briggs and Morgan, Professional
Association, Bond Counsel, in connection with rendering its opinion that the interest on the Bonds is excluded
from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form
8038-G, and other federal income tax advice that it may give to the Issuer [ and the Borrower] from time to
time relating to the Bonds.
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