RES 20-68EXTRACT OF MINUTES OF A MEETING
OF THE CITY COUNCIL
CITY OF OTSEGO, MINNESOTA
HELD: October 12, 2020
Pursuant to due call, 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 October 12, 2020, at 7:00
P.M., for the purpose in part of authorizing the issuance and awarding the sale of $2,950,000
General Obligation Improvement Refunding Bonds, Series 2020A.
The following members were present: Stockamp, Darkenwald, Tanner, Goede, Warehime
and the following were absent: None
Member Goede introduced the following resolution and moved its adoption:
RESOLUTION 2020-68 ACCEPTING PROPOSAL ON THE NEGOTIATED SALE OF
$2,950,000 GENERAL OBLIGATION IMPROVEMENT REFUNDING BONDS, SERIES
2020A, PLEDGING FOR THE SECURITY THEREOF SPECIAL ASSESSMENTS AND
LEVYING A TAX FOR THE PAYMENT THEREOF
A. WHEREAS, the City Council of the City of Otsego, Minnesota (the "City") has
heretofore determined and declared that it is necessary and expedient to issue $2,950,000
General Obligation Improvement Refunding Bonds, Series 2020A for (the "Bonds" or
individually, a "Bond"), pursuant to Minnesota Statutes, Chapters 475 for a current refunding on
November 17, 2020 (the "Call Date") of the City's $1,220,000 original principal amount of
General Obligation Improvement Refunding Bonds, Series 2010D, dated November 1, 2010 (the
"Prior 2010D Bonds"), and $4,640,000 original principal amount of General Obligation
Improvement Crossover Refunding Bonds, Series 2011A, dated December 1, 2011 (the "Prior
201 IA Bonds" and together with the Prior 201 OD Bonds, the "Prior Bonds"), maturing on and
after February 1, 2021, and;
B. WHEREAS, (i) $805,000 aggregate principal amount of the Prior 2010D Bonds
which matures on and after February 1, 2021 (the "Refunded 201 OD Bonds"), is callable on the
Call Date, at a price of par plus accrued interest, as provided in the Resolution adopted by the
City Council on October 25, 2010, authorizing the issuance of the Prior 201 OD Bonds (the "Prior
2010D Resolution"); and (ii) $2,365,000 aggregate principal amount of the Prior 201 IA Bonds
which matures on and after February 1, 2021 (the "Refunded 2011A Bonds"), is callable on the
Call Date, at a price of par plus accrued interest as provided in the resolution adopted by the City
Council on November 28, 2011, authorizing the issuance of the Prior 201 lA Bonds (the "Prior
2011A Resolution" and together with the Prior 201 OD Resolution, the "Prior Resolutions"); and
C. WHEREAS, the refunding of the Refunded 201 OD Bonds and the Refunded
2011A Bonds (together, the "Refunded Bonds") on the Call Date is consistent with covenants
made with the holders thereof, and is necessary and desirable for the reduction of debt service
cost to the City; and
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D. WHEREAS, the City has retained AEM Financial Solutions, in Edina, Minnesota,
as its independent municipal advisor for the sale of the Bonds and was therefore authorized to
sell the Bonds by private negotiation in accordance with Minnesota Statutes, Section 475.60,
Subdivision 2(9); and
E. WHEREAS, it is in the best interests of the City that the Bonds be issued in book -
entry form as hereafter provided.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Otsego,
Minnesota, as follows:
1. Acceptance of Officer; Purchase Contract.
(a) The offer of Northland Securities, Inc. (the "Purchaser"), to purchase the Bonds in
accordance with the terms and at the rates of interest hereinafter set forth, and to pay therefor the
sum of $3,226,799.50, plus interest accrued to settlement, is hereby accepted.
2. Bond Terms.
(a) Original Issue Date; Denominations; Maturities; Term Bond Option. The Bonds
shall be dated November 17, 2020, as the date of original issue, be issued forthwith on or after
such date in fully registered form, be numbered from R-1 upward in the denomination of $5,000
each or in any integral multiple thereof of a single maturity (the "Authorized Denominations")
and mature on February 1 in the years and amounts as follows:
Year Amount Year Amount
2021
$505,000
2025
$280,000
2022
475,000
2026
290,000
2023
495,000
2027
315,000
2024
270,000
2028
320,000
As may be requested by the Purchaser, one or more term Bonds may be issued having
mandatory sinking fund redemption and final maturity amounts conforming to the foregoing
principal repayment schedule, and corresponding additions may be made to the provisions of the
applicable Bond(s).
(b) Allocation. The aggregate principal amount of $740,000 maturing in each of the
years and amounts hereinafter set forth are issued to finance the refunding of the Refunded
201 OD Bonds (the "201 OD Refunding Portion"); and the aggregate principal amount of
$2,210,000 maturing in each of the years and amounts hereinafter set forth are issued to finance
the refunding of the Refunded 2011A Bonds (the "2011A Refunding Portion"):
Year 201 OD Refunding
Portion (Amount)
2021 $90,000
2022 85,000
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2011A Refunding
Portion (Amount)
$415,000
390,000
2
Total Amount
$505,000
475,000
2023
85,000
410,000
495,000
2024
90,000
180,000
270,000
2025
90,000
190,000
280,000
2026
95,000
195,000
290,000
2027
100,000
215,000
315,000
2028
105,000
215,000
320,000
If Bonds are prepaid, the prepayments shall be allocated to the portions of debt service
(and hence allocated to the payment of Bonds treated as relating to a particular portion of debt
service) as provided in this paragraph. If the source of prepayment moneys is the general fund of
the City, or other generally available source, the prepayment may be allocated to either or both of
the portions of debt service in such amounts as the City shall determine. If the source of the
prepayment is special assessments pledged to and taxes levied for the 201 OD Prior Bonds, the
prepayment shall be allocated to the 201 OD Refunding Portion of debt service. If the source of
the prepayment is special assessments pledged to and taxes levied for the 2011A Refunding
Bonds, the prepayment shall be allocated to the 2011A Refunding Portion of debt service.
(c) Book Entry OnlySystem. The Depository Trust Company, a limited purpose
trust company organized under the laws of the State of New York or any of its successors or its
successors to its functions hereunder (the "Depository") will act as securities depository for the
Bonds, and to this end:
(i) The Bonds shall be initially issued and, so long as they remain in book
entry form only (the "Boole Entry Only Period"), shall at all times be in the form of a
separate single fully registered Bond for each maturity of the Bonds; and for purposes of
complying with this requirement under paragraphs 5 and 10 Authorized Denominations
for any Bond shall be deemed to be limited during the Book Entry Only Period to the
outstanding principal amount of that Bond.
(ii) Upon initial issuance, ownership of the Bonds shall be registered in a bond
register maintained by the Bond Registrar (as hereinafter defined) in the name of CEDE
& CO, as the nominee (it or any nominee of the existing or a successor Depository, the
"Nominee").
(iii) With respect to the Bonds neither the City nor the Bond Registrar shall
have any responsibility or obligation to any broker, dealer, bank, or any other financial
institution for which the Depository holds Bonds as securities depository (the
"Participant") or the person for which a Participant holds an interest in the Bonds shown
on the books and records of the Participant (the "Beneficial Owner"). Without limiting
the immediately preceding sentence, neither the City, nor the Bond Registrar, shall have
any such responsibility or obligation with respect to (A) the accuracy of the records of the
Depository, the Nominee or any Participant with respect to any ownership interest in the
Bonds, or (B) the delivery to any Participant, any Owner or any other person, other than
the Depository, of any notice with respect to the Bonds, including any notice of
redemption, or (C) the payment to any Participant, any Beneficial Owner or any other
person, other than the Depository, of any amount with respect to the principal of or
premium, if any, or interest on the Bonds, or (D) the consent given or other action taken
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by the Depository as the Registered Holder of any Bonds (the "Holder"). For purposes of
securing the vote or consent of any Holder under this Resolution, the City may, however,
rely upon an omnibus proxy under which the Depository assigns its consenting or voting
rights to certain Participants to whose accounts the Bonds are credited on the record date
identified in a listing attached to the omnibus proxy.
(iv) The City and the Bond Registrar may treat as and deem the Depository to
be the absolute owner of the Bonds for the purpose of payment of the principal of and
premium, if any, and interest on the Bonds, for the purpose of giving notices of
redemption and other matters with respect to the Bonds, for the purpose of obtaining any
consent or other action to be taken by Holders for the purpose of registering transfers
with respect to such Bonds, and for all purpose whatsoever. The Bond Registrar, as
paying agent hereunder, shall pay all principal of and premium, if any, and interest on the
Bonds only to the Holder or the Holders of the Bonds as shown on the bond register, and
all such payments shall be valid and effective to fully satisfy and discharge the City's
obligations with respect to the principal of and premium, if any, and interest on the Bonds
to the extent of the sum or sums so paid.
(v) Upon delivery by the Depository to the Bond Registrar of written notice to
the effect that the Depository has determined to substitute a new Nominee in place of the
existing Nominee, and subject to the transfer provisions in paragraph 10, references to the
Nominee hereunder shall refer to such new Nominee.
(vi) So long as any Bond is registered in the name of a Nominee, all payments
with respect to the principal of and premium, if any, and interest on such Bond and all
notices with respect to such Bond shall be made and given, respectively, by the Bond
Registrar or City, as the case may be, to the Depository as provided in the Letter of
Representations to the Depository required by the Depository as a condition to its acting
as book -entry Depository for the Bonds (said Letter of Representations, together with any
replacement thereof or amendment or substitute thereto, including any standard
procedures or policies referenced therein or applicable thereto respecting the procedures
and other matters relating to the Depository's role as book -entry Depository for the
Bonds, collectively hereinafter referred to as the "Letter of Representations").
(vii) All transfers of beneficial ownership interests in each Bond issued in
book -entry form shall be limited in principal amount to Authorized Denominations and
shall be effected by procedures by the Depository with the Participants for recording and
transferring the ownership of beneficial interests in such Bonds.
(viii) In connection with any notice or other communication to be provided to
the Holders pursuant to this Resolution by the City or Bond Registrar with respect to any
consent or other action to be taken by Holders, the Depository shall consider the date of
receipt of notice requesting such consent or other action as the record date for such
consent or other action; provided, that the City or the Bond Registrar may establish a
special record date for such consent or other action. The City or the Bond Registrar shall,
to the extent possible, give the Depository notice of such special record date not less than
15 calendar days in advance of such special record date to the extent possible.
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12860109v1
(ix) Any successor Bond Registrar in its written acceptance of its duties under
this Resolution and any paying agency/bond registrar agreement, shall agree to take any
actions necessary from time to time to comply with the requirements of the Letter of
Representations.
(x) In the case of a partial prepayment of a Bond, the Holder may, in lieu of
surrendering the Bonds for a Bond of a lesser denomination as provided in paragraph 5,
make a notation of the reduction in principal amount on the panel provided on the Bond
stating the amount so redeemed.
(d) Termination of Book -Entry Only S sem. Discontinuance of a particular
Depository's services and termination of the book -entry only system may be effected as follows:
(i) The Depository may determine to discontinue providing its services with
respect to the Bonds at any time by giving written notice to the City and discharging its
responsibilities with respect thereto under applicable law. The City may terminate the
services of the Depository with respect to the Bond if it determines that the Depository
is no longer able to carry out its functions as securities depository or the continuation of
the system of book -entry transfers through the Depository is not in the best interests of
the City or the Beneficial Owners.
(ii) Upon termination of the services of the Depository as provided in the
preceding paragraph, and if no substitute securities depository is willing to undertake the
functions of the Depository hereunder can be found which, in the opinion of the City, is
willing and able to assume such functions upon reasonable or customary terms, or if the
City determines that it is in the best interests of the City or the Beneficial Owners of the
Bond that the Beneficial Owners be able to obtain certificates for the Bonds, the Bonds
shall no longer be registered as being registered in the bond register in the name of the
Nominee, but may be registered in whatever name or names the Holder of the Bonds
shall designate at that time, in accordance with paragraph 10. To the extent that the
Beneficial Owners are designated as the transferee by the Holders, in accordance with
paragraph 10, the Bonds will be delivered to the Beneficial Owners.
(iii) Nothing in this subparagraph (d) shall limit or restrict the provisions of
paragraph 10.
(e) Letter of Representations. The provisions in the Letter of Representations are
incorporated herein by reference and made a part of the resolution, and if and to the extent any
such provisions are inconsistent with the other provisions of this resolution, the provisions in the
Letter of Representations shall control.
3. Purpose; Findings. The Bonds shall provide funds for the current refunding of the
Refunded Bonds (the "Refunding"). It is hereby found, determined and declared that the
Refunding is pursuant to Minnesota Statutes, Section 475.67, and shall result in a reduction of
debt service cost to the City.
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4. Interest. The Bonds shall bear interest payable semiannually on February 1 and
August 1 of each year (each, an "Interest Payment Date"), commencing February 1, 2021,
calculated on the basis of a 360 -day year of twelve 30 -day months, at the respective rates per
annum set forth opposite the maturity years as follows:
Maturity Year
2021
2022
2023
2024
Interest Rate
4.000%
4.000
4.000
4.000
Maturity Year
2025
2026
2027
2028
Interest Rate
4.000%
4.000
4.000
4.000
5. No Optional Redemption. The Bonds shall not be subject to redemption and
prepayment prior to their stated maturity dates.
6. Bond Re isg_trar. Northland Trust Services, Inc., in Minneapolis, Minnesota, is
appointed to act as bond registrar and transfer agent with respect to the Bonds (the "Bond
Registrar"), and shall do so unless and until a successor Bond Registrar is duly appointed, all
pursuant to any contract the City 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 Bonds shall be paid to the registered holders (or
record holders) of the Bonds in the manner set forth in the form of Bond and paragraph t2 of this
resolution.
7. Form of Bond. The 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:
ON
12860109vl
UNITED STATES OF AMERICA
STATE OF MINNESOTA
WRIGHT COUNTY
CITY OF OTSEGO
R- $
GENERAL OBLIGATION IMPROVEMENT REFUNDING BOND, SERIES 2020A
Interest Rate Maturity Date of Original Issue CUSIP
_% February 1, November 17, 2020
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
The City of Otsego, Wright County, Minnesota (the "Issuer"), certifies 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, 2021, 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 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 Bond are payable upon presentation and surrender hereof at the
principal office of Northland Trust Services, Inc., in Minneapolis, Minnesota (the "Bond
Registrar"), acting as paying agent, or any successor paying agent duly appointed by the Issuer.
Interest on this Bond will be paid on each Interest Payment Date by check or draft mailed to the
person in whose name this 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 Bond are payable in lawful money of the United States of America. So long as
this Bond is registered in the name of the Depository or its Nominee as provided in the
Resolution hereinafter described, and as those terms are defined therein, payment of principal of,
premium, if any, and interest on this Bond and notice with respect thereto shall be made as
provided in the Letter of Representations, as defined in the Resolution, and surrender of this
Bond shall not be required for payment of the redemption price upon a partial redemption of this
Bond. Until termination of the book -entry only system pursuant to the Resolution, Bonds may
only be registered in the name of the Depository or its Nominee.
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12860109v1
No Optional Redemption. The Bonds shall not be subject to redemption and prepayment
prior to their stated maturity dates.
Issuance• Purpose; General Obligation. This Bond is one of an issue in the total principal
amount of $2,950,000, all of like date of original issue and tenor, except as to number, maturity,
interest rate, denomination and redemption privilege, issued pursuant to and in full conformity
with the Constitution and laws of the State of Minnesota and pursuant to a resolution adopted by
the City Council on October 12, 2020 (the "Resolution"), for the purpose of providing funds for a
current refunding of certain outstanding general obligation bonds of the Issuer. This Bond is
payable out of the General Obligation Improvement Refunding Bonds, Series 2020A Fund of the
Issuer. This Bond constitutes a general obligation of the Issuer, and to provide moneys for the
prompt and full payment of its principal, premium, if any, and interest when the same become
due, the full faith and credit and taxing powers of the Issuer have been and are hereby
irrevocably pledged.
Denominations; Exchange; Resolution. The Bonds are issuable solely in fully registered
form in Authorized Denominations (as defined in the Resolution) and are exchangeable for fully
registered 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 Bond Registrar.
Transfer. This Bond is transferable by the Holder in person or by the Holder's 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 Bond, one or more new fully registered 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 amount equal to the principal amount of
this Bond, of the same maturity and bearing interest at the same rate.
Fees 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 Bond and any legal or unusual costs regarding transfers and lost Bonds.
Treatment of Registered Owners. The Issuer and Bond Registrar may treat the person in
whose name this Bond is registered as the owner hereof for the purpose of receiving payment as
herein provided (except as otherwise provided herein with respect to the Record Date) and for all
other purposes, whether or not this Bond shall be overdue, and neither the Issuer nor the Bond
Registrar shall be affected by notice to the contrary.
Authentication. This 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.
N.
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Not Qualified Tax -Exempt Obligation. This Bond has not been designated by the Issuer
as a "qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the Internal Revenue
Code of 1986, as amended.
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 Bond, have been done, have happened and
have been performed, in regular and due form, time and manner as required by law and that this
Bond, together with all other debts of the Issuer outstanding on the date of original issue hereof
and 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 City of Otsego, Wright County, Minnesota, by its City
Council has caused this Bond to be executed on its behalf by the facsimile signatures of its
Mayor and its City Administrator -Finance Director, the corporate seal of the Issuer having been
intentionally omitted as permitted by law.
Date of Registration:
BOND REGISTRAR'S
CERTIFICATE OF
AUTHENTICATION
This Bond is one of the
Bonds described in the
Resolution mentioned
within.
NORTHLAND TRUST SERVICES, INC.
Minneapolis, Minnesota
Bond Registrar
Authorized Signature
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Registrable by: NORTHLAND TRUST
SERVICES, INC.
Payable at: NORTHLAND TRUST
SERVICES, INC.
CITY OF OTSEGO,
WRIGHT COUNTY, MINNESOTA
/s/ Facsimile
Mayor
/s/ Facsimile
City Administrator -Finance Director
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this 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
(State)
Transfers to Minors Act
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond
and does hereby irrevocably constitute and appoint attorney to transfer the
Bond on the books kept for the registration thereof, 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:
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 or any other "Eligible Guarantor
Institution" as defined in 17 CFR 240.17 Ad -15(a)(2).
The Bond Registrar will not effect transfer of this Bond unless the information
concerning the transferee requested below is provided.
Name and Address:
(Include information for all joint owners if the Bond is held by joint account.)
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12860109v1
8. Execution. The Bonds shall be in typewritten form, shall be executed on behalf of
the City by the signatures of its Mayor and City Administrator -Finance Director and be sealed
with the seal of the City; provided, as permitted by law, both signatures may be photocopied
facsimiles and the corporate seal has been omitted. In the event of disability or resignation or
other absence of either officer, the Bonds may be signed by the manual or facsimile signature of
the officer who may act on behalf of the absent or disabled officer. In case either officer whose
signature or facsimile of whose signature shall appear on the Bonds shall cease to be such officer
before the delivery of the Bonds, the signature or facsimile shall nevertheless be valid and
sufficient for all purposes, the same as if the officer had remained in office until delivery.
9. Authentication. No Bond shall be valid or obligatory for any purpose or be
entitled to any security or benefit under this resolution unless a Certificate of Authentication on
the 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
Bonds need not be signed by the same person. The Bond Registrar shall authenticate the
signatures of officers of the City on each Bond by execution of the Certificate of Authentication
on the Bond and by inserting as the date of registration in the space provided the date on which
the 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 of
November 17, 2020. The Certificate of Authentication so executed on each Bond shall be
conclusive evidence that it has been authenticated and delivered under this resolution.
10. Registration; Transfer; Exchange. The City 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 Bonds
and the registration of transfers of Bonds entitled to be registered or transferred as herein
provided.
Upon surrender for transfer of any Bond at the principal office of the Bond Registrar, the
City shall execute (if necessary), and the Bond Registrar shall authenticate, insert the date of
registration (as provided in paragraph 9) of, and deliver, in the name of the designated transferee
or transferees, one or more new 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 Bond may be registered in blank or in the name of
"bearer" or similar designation.
At the option of the Holder, Bonds may be exchanged for Bonds of any Authorized
Denomination or Denominations of a like aggregate principal amount and stated maturity, upon
surrender of the Bonds to be exchanged at the principal office of the Bond Registrar. Whenever
any Bonds are so surrendered for exchange, the City shall execute (if necessary), and the Bond
Registrar shall authenticate, insert the date of registration of, and deliver the Bonds which the
Holder making the exchange is entitled to receive.
All 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 City.
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All Bonds delivered in exchange for or upon transfer of Bonds shall be valid general
obligations of the City evidencing the same debt, and entitled to the same benefits under this
resolution, as the Bonds surrendered for such exchange or transfer.
Every 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 the Holder's 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 Bond and any
legal or unusual costs regarding transfers and lost Bonds.
Transfers shall also be subject to reasonable regulations of the City 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. The City Administrator -
Finance Director is hereby authorized to negotiate and execute the terms of said agreement.
11. Rights Upon Transfer or Exchange. Each Bond delivered upon transfer of or in
exchange for or in lieu of any other Bond shall carry all the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Bond.
12. Interest Payment; Record Date. Interest on any 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 City 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 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 days prior to the
Special Record Date.
13. Treatment of Registered Owner. The City and Bond Registrar may treat the
person in whose name any Bond is registered as the owner of such Bond for the purpose of
receiving payment of principal of and premium, if any, and interest (subject to the payment
provisions in paragraph 12) on, such Bond and for all other purposes whatsoever whether or not
such Bond shall be overdue, and neither the City nor the Bond Registrar shall be affected by
notice to the contrary.
14. Delivery, Application of Proceeds. The Bonds when so prepared and executed
shall be delivered by the City Administrator -Finance Director to the Purchaser upon receipt of
the purchase price, and the Purchaser shall not be obliged to see to the proper application thereof.
15. Fund and Accounts. There is hereby created a special fund to be designated the
"General Obligation Improvement Refunding Bonds, Series 2020A Fund" (the "Fund") to be
administered and maintained by the City Administrator -Finance Director as a bookkeeping
account separate and apart from all other funds maintained in the official financial records of the
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City. The Fund shall be maintained in the manner herein specified until all of the Bonds and the
interest thereon have been fully paid. There shall be maintained in the Fund the following
accounts:
(a) Payment Account. To the Payment Account there shall be credited the proceeds
of the Bonds. From the Payment Account, on or prior to the Call Date, the City Administrator -
Finance Director shall transfer (i) $812,752.72 of the proceeds of the 2010D Refunding Portion
of the Bonds from the Payment Account to the paying agent for the Prior 2010D Bonds and (ii)
$2,383,297.51of the proceeds of the 2011A Refunding Portion of the Bonds from the Payment
Account to the paying agent for the Prior 2011A Bonds, which sums are sufficient, together with
other funds on deposit in debt service funds for the Refunded Bonds, to pay the principal and
interest due on the Refunded Bonds due after the Call Date, including the principal and any
accrued interest due on the Refunded Bonds called for redemption on the Call Date. The
remainder of the monies in the Payment Account shall be used to pay the costs of issuance of the
Bonds. Any monies remaining in the Payment Account after payment of all costs of issuance
and payment of the Refunded Bonds shall be transferred to the Debt Service Account.
(b) Debt Service Account. There are hereby irrevocably appropriated and pledged to,
and there shall be credited to the Debt Service Account: (A) any balance remaining after the Call
Date in the 201 OD Debt Service Account created by the Prior 201 OD Resolution; (B) any balance
remaining after the Call Date in the 2011A Debt Service Account created by the Prior 2011A
Resolution; (C) any uncollected special assessments which were heretofore pledged for the
payment of the Refunded 201 OD Bonds and are herein pledged to the payment of the 201 OD
Refunding Portion of the Bonds; (D) any uncollected special assessments which were heretofore
pledged for the payment of the Refunded 2011A Bonds and are herein pledged to the payment of
the 2011A Refunding Portion of the Bonds; (E) any taxes herein or hereinafter levied for the
payment of the 2010D Refunding Portion of the Bonds; (F) any taxes herein or hereinafter levied
for the payment of the 2011A Refunding Portion of the Bonds; (G) any funds remaining in the
Payment Account after the cost of issuing the Bonds have been paid; H) all investment earnings
on funds held in the Debt Service Account; and (I) any and all other moneys which are properly
available and are appropriated by the governing body of the City to the Debt Service Account.
The amount of any surplus remaining in the Debt Service Account when the Bonds and interest
thereon are paid shall be used consistent with Minnesota Statutes, Section 475.61, Subdivision 4.
No portion of the 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 until such proceeds are
needed for the purpose for which the Bonds were issued and (2) in addition to the above in an
amount not greater than the lesser of five percent of the proceeds of the Bonds or $100,000. To
this effect, any proceeds of the Bonds and any sums from time to time held in the Debt Service
Account (or any other City account which will be used to pay principal or interest to become due
on the bonds payable therefrom) in excess of amounts which under then applicable federal
arbitrage regulations may be invested without regard to yield shall not be invested at a yield in
excess of the applicable yield restrictions imposed by said arbitrage regulations on such
investments after taking into account any applicable "temporary periods" or "minor portion"
made available under the federal arbitrage regulations. Money in the Fund shall not be invested
in obligations or deposits issued by, guaranteed by or insured by the United States or any agency
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or instrumentality thereof if and to the extent that such investment would cause the Bonds to be
"federally guaranteed" within the meaning of Section 149(b) of the Internal Revenue Code of
1986, as amended (the "Code").
16. Covenants Relating to the 201 OD Refunding Portion of the Bonds.
(a) Special Assessments. The City has heretofore levied special assessments
pursuant to the Prior 201 OD Resolution, which were pledged to the payment of the principal and
interest on the Prior 201 OD Bonds and, after the Call Date, the uncollected special assessments
for the Prior 201 OD Bonds are now pledged to the payment of principal and interest on the
2010D Refunding Portion of the Bonds. The special assessments are such that if collected in full
they, together with estimated collections of taxes herein pledged for the payment of the 201 OD
Refunding Portion of the Bonds, will produce at least five percent in excess of the amount
needed to meet when due the principal and interest payments on the 201OD Refunding Portion
of the Bonds. The special assessments were levied as provided below, payable in equal,
consecutive, annual installments, with general taxes for the years shown below and with interest
on the declining balance of all such assessments at the rate shown opposite such years:
Collection
Improvement Designation_ Levy Years Years Amount Rate
Queens Avenue Project
CSAH Project
See Attached Schedule
(b) Tax Levy' Coverage Test; Cancellation of Certain Tax Levies. To provide
moneys for payment of the principal and interest on the 201 OD Refunding Portion of the Bonds
there is hereby levied upon all of the taxable property in the City a direct annual ad valorem tax
which shall be spread upon the tax rolls and collected with and as part of other general property
taxes in the City for the years and in the amounts as follows:
Year of Tax Levy Year of Tax Collection Amount
See Attached Schedule
The tax levies are such that if collected in full they, together with estimated collections of
special assessments and any other revenues herein pledged for the payment of the 201 OD Bonds
Refunding Portion of the Bonds, will produce at least five percent in excess of the amount
needed to meet when due the principal and interest payments on the 201 OD Refunding Portion of
the Bonds. The tax levies shall be irrepealable so long as any of the 201 OD Refunding Portion
of the Bonds are outstanding and unpaid, provided that the City reserves the right and power to
reduce the levies in the manner and to the extent permitted by Minnesota Statutes, Section
475.61, Subdivision 3.
Upon payment of the Prior 201 OD Bonds, the uncollected taxes levied in the Prior 2010D
Resolution authorizing the issuance of the Prior 201 OD Bonds which are not needed to pay the
Prior 2010D Bonds as a result of the Refunding shall be canceled.
17. Covenants Relating to the 201 lA Refunding Portion of the Bonds.
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(a) Special Assessments. The City has heretofore levied special assessments
pursuant to the Prior 201 IA Resolution, which were pledged to the payment of the principal and
interest on the Prior 2011A Bonds and, after the Call Date, the uncollected special assessments
for the Prior 201 IA Bonds are now pledged to the payment of principal and interest on the
2011A Refunding Portion of the Bonds. The special assessments are such that if collected in full
they, together with estimated collections of taxes herein pledged for the payment of the 2011A
Refunding Portion of the Bonds, will produce at least five percent in excess of the amount
needed to meet when due the principal and interest payments on the 2011A Refunding Portion of
the Bonds. The special assessments were levied as provided below, payable in equal,
consecutive, annual installments, with general taxes for the years shown below and with interest
on the declining balance of all such assessments at the rate shown opposite such years:
Collection
Improvement Designation Levy Years Years Amount Rate
Queens Avenue Project
CSAH Project
See Attached Schedule
(b) Tax Levy; Coverage Test; Cancellation of Certain Tax Levies. To provide
moneys for payment of the principal and interest on the 2011A Refunding Portion of the Bonds
there is hereby levied upon all of the taxable property in the City a direct annual ad valorem tax
which shall be spread upon the tax rolls and collected with and as part of other general property
taxes in the City for the years and in the amounts as follows:
Year of Tax Levy Year of Tax Collection Amount
See Attached Schedule
The tax levies are such that if collected in full they, together with estimated collections of
special assessments and any other revenues herein pledged for the payment of the 2011A
Refunding Portion of the Bonds, will produce at least five percent in excess of the amount
needed to meet when due the principal and interest payments on the 2011A Refunding Portion of
the Bonds. The tax levies shall be irrepealable so long as any of the 2011A Refunding Portion of
the Bonds are outstanding and unpaid, provided that the City reserves the right and power to
reduce the levies in the manner and to the extent permitted by Minnesota Statutes, Section
475.61, Subdivision 3.
Upon payment of the Prior 2011A Bonds, the uncollected taxes levied in the Prior 2011A
Resolution authorizing the issuance of the Prior 2011A Bonds which are not needed to pay the
Prior 2011A Bonds as a result of the Refunding shall be canceled.
18. General Obligation Pledge. For the prompt and full payment of the principal and
interest on the Bonds, as the same respectively become due, the full faith, credit and taxing
powers of the City shall be and are hereby irrevocably pledged. If the balance in the Debt
Service Account is ever insufficient to pay all principal and interest then due on the Bonds and
any other bonds payable therefrom, the deficiency shall be promptly paid out of any other funds
15
12860109v1
of the City which are available for such purpose, and such other funds may be reimbursed with
or without interest from the Debt Service Account when a sufficient balance is available therein.
19. Prior Bonds, Approval and Security. Until retirement of the Prior Bonds, all
provisions theretofore made for the security thereof shall be observed by the City and all of its
officers and agents.
20. Redemption of Refunded Bonds. The City Administrator -Finance Director is
hereby authorized and directed to give mailed notice of redemption prior to the Call Date to the
paying agent for the Refunded Bonds, in substantially the form attached hereto as Exhibits A and
B. The Refunded Bonds shall be redeemed and prepaid on the Call Date in accordance with the
terms and conditions set forth in the Notices of Call for Redemption, which terms and conditions
are hereby approved and incorporated herein by reference.
21. Supplemental Resolution. The Prior Resolutions authorizing the issuance of the
Prior Bonds are hereby supplemented to the extent necessary to give effect to the provisions
hereof.
22. Defeasance. When all Bonds have been discharged as provided in this paragraph,
all pledges, covenants and other rights granted by this resolution to the registered holders of the
Bonds shall, to the extent permitted by law, cease. The City may discharge its obligations with
respect to any Bonds which are due on any date by irrevocably depositing with the Bond
Registrar on or before that date a sum sufficient for the payment thereof in full; or if any Bond
should not be paid when due, it may nevertheless be discharged by depositing with the Bond
Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such
deposit. The City may also at any time discharge its obligations with respect to any Bonds,
subject to the provisions of law now or hereafter authorizing and regulating such action, by
depositing irrevocably in escrow, with a suitable banking institution qualified by law as an
escrow agent for this purpose, cash or securities described in Minnesota Statutes, Section 475.67,
Subdivision 8, bearing interest payable at such times and at such rates and maturing on such
dates as shall be required, without regard to sale and/or reinvestment, to pay all amounts to
become due thereon to maturity or, if notice of redemption as herein required has been duly
provided for, to such earlier redemption date.
23. Continuing Disclosure. The City is the sole obligated person with respect to the
Bonds. The City hereby agrees, in accordance with the provisions of Rule 15c2-12 (the "Rule"),
promulgated by the Securities and Exchange Commission (the "Commission") pursuant to the
Securities Exchange Act of 1934, as amended, and a Continuing Disclosure Undertaking (the
"Undertaking") hereinafter described to:
(a) Provide or cause to be provided to the Municipal Securities Rulemaking Board
(the "MSRB") by filing at www.emma.msrb.org in accordance with the Rule, certain annual
financial information and operating data in accordance with the Undertaking. The City reserves
the right to modify from time to time the terms of the Undertaking as provided therein.
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(b) Provide or cause to be provided to the MSRB notice of the occurrence of certain
events with respect to the Bonds in not more than ten (10) business days after the occurrence of
the event, in accordance with the Undertaking.
(c) Provide or cause to be provided to the MSRB notice of a failure by the City to
provide the annual financial information with respect to the City described in the Undertaking, in
not more than ten (10) business days following such occurrence.
(d) The City agrees that its covenants pursuant to the Rule set forth in this paragraph
and in the Undertaking is intended to be for the benefit of the Holders of the Bonds and shall be
enforceable on behalf of such Holders; provided that the right to enforce the provisions of these
covenants shall be limited to a right to obtain specific enforcement of the City's obligations under
the covenants.
The Mayor and City Administrator -Finance Director of the City, or any other officer of
the City authorized to act in their place (the "Officers") are hereby authorized and directed to
execute on behalf of the City the Undertaking in substantially the form presented to the City
Council subject to such modifications thereof or additions thereto as are (i) consistent with the
requirements under the Rule, (ii) required by the Purchaser of the Bonds, and (iii) acceptable to
the Officers.
24. Certificate of Registration. A certified copy of this resolution is hereby directed
to be filed with the County Auditor of Wright County, Minnesota, together with such other
information as the County Auditor shall require, and there shall be obtained from the County
Auditor a certificate that the Bonds have been entered in the County Auditor's Bond Register,
and that the tax levy required by law has been made.
25. Records and Certificates. The officers of the City are hereby authorized and
directed to prepare and furnish to the Purchaser, and to the attorneys approving the legality of the
issuance of the Bonds, certified copies of all proceedings and records of the City relating to the
Bonds and to the financial condition and affairs of the City, and such other affidavits, certificates
and information as are required to show the facts relating to the legality and marketability of the
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 copies, certificates and affidavits, including any
heretofore furnished, shall be deemed representations of the City as to the facts recited therein.
26. Negative Covenant as to Use of Bond Proceeds and Project. The City hereby
covenants not to use the proceeds of the Bonds or to use the Project, or to cause or permit them
to be used, or to enter into any deferred payment arrangements for the cost of the Project, 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.
27. Tax -Exempt Status; Rebate. The City shall comply with requirements necessary
under the Code to establish and maintain the exclusion from gross income under Section 103 of
the Code of the interest on the Bonds, including without limitation (i) requirements relating to
temporary periods for investments, (ii) limitations on amounts invested at a yield greater than the
yield on the Bonds, and (iii) the rebate of excess investment earnings to the United States. The
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City expects to satisfy the six month expenditure exemption from gross proceeds of the Bonds as
provided in Section 1.148-7(c) of the Regulations. The Mayor and or City Administrator -
Finance Director are hereby authorized and directed to make such elections as to arbitrage and
rebate matters relating to the Bonds as they deem necessary, appropriate or desirable in
connection with the Bonds, and all such elections shall be, and shall be deemed and treated as,
elections of the City.
28, Not Designated as Qualified Tax -Exempt Obligations. The City will not
designate the Bonds as "qualified tax exempt obligations" for proposes of Section 265(b)(3) of
the Code.
29. Supplemental Resolution, The Prior Resolutions are hereby supplemented to the
extent necessary to give effect to the provisions hereof.
30. 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.
31. Headings. 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.
The motion for the adoption of the foregoing resolution was duly seconded by member
Warehime and, after a full discussion thereof and upon a vote being taken thereon, the following
voted in favor thereof: Stockamp, Darkenwald, Tanner, Goede, Warehime
and the following voted against the same: None
Whereupon the resolution was declared duly passed and adopted.
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EXHIBIT A
NOTICE OF CALL FOR REDEMPTION
CITY OF OTSEGO
WRIGHT COUNTY, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT REFUNDING BONDS, SERIES 2010D
NOTICE IS HEREBY GIVEN that by order of the City Council of the City of Otsego, Wright
County, Minnesota (the "City"), there have been called for redemption and prepayment on
November 17, 2020
those outstanding bonds of the City designated General Obligation Improvement Refunding
Bonds, Series 201 OD (the 'Bonds"), dated November 1, 2010, having stated maturity dates or
subject to mandatory redemption in the years 2021 through 2028, inclusive, and totaling
$805,000 in principal amount and having CUSIP numbers listed below:
Year
Principal Amount
CUSIP*
2021
$90,000
689146
LP 1
2023
190,000
689146
LQ9
2026
305,000
689146
LR7
2027
110,000
689146
LS5
2028
110,000
689146
LT3
The bonds are being called at a price of par plus accrued interest to November 17, 2020, on
which date all interest on the Bonds will cease to accrue. Holders of the bonds hereby called for
redemption are requested to present their bonds for payment at the offices of Northland Trust
Services, Inc., 150 South Fifth Street, Suite 3300, Minneapolis, MN, 55402.
Dated: October 12, 2020 BY ORDER OF THE CITY COUNCIL
/s/ Adam Flaherty
City Administrator -Finance Director
*The City shall not be responsible for the selection of or use of the CUSIP numbers, nor is any
representation made as to their correctness indicated in the notice. They are included solely for
the convenience of the holders
12860109v1
EXHIBIT B
NOTICE OF CALL FOR REDEMPTION
CITY OF OTSEGO
WRIGHT COUNTY, MINNESOTA
GENERAL OBLIGATION IMPROVEMENT CROSSOVER REFUNDING BONDS, SERIES
2011A
NOTICE IS HEREBY GIVEN that by order of the City Council of the City of Otsego, Wright
County, Minnesota (the "City"), there have been called for redemption and prepayment on
November 17, 2020
those outstanding bonds of the City designated General Obligation Improvement Crossover
Refunding Bonds, Series 2011A (the 'Bonds"), dated December 1, 2011, having stated maturity
dates or subject to mandatory redemption in the years 2021 through 2028, inclusive, and totaling
$2,365,000 in principal amount and having CUSIP numbers listed below:
Year
Principal Amount
CUSIP*
2021
$415,000
689146 MA3
2022
425,000
689146 MBI
2023
435,000
689146 MC9
2024
200,000
689146 MD7
2025
210,000
689146 ME5
2027
445,000
689146 MGO
2028
235,000
689146 MH8
The bonds are being called at a price of par plus accrued interest to November 17, 2020, on
which date all interest on the Bonds will cease to accrue. Holders of the bonds hereby called for
redemption are requested to present their bonds for payment at the offices of Northland Trust
Services, Inc., 150 South Fifth Street, Suite 3300, Minneapolis, MN, 55402.
Dated: October 12, 2020 BY ORDER OF THE CITY COUNCIL
/s/ Adam Flaherty
City Administrator -Finance Director
*The City shall not be responsible for the selection of or use of the CUSIP numbers, nor is any
representation made as to their correctness indicated in the notice. They are included solely for
the convenience of the holders
128601090
Levy Schedule
2010D
less:
Equals:
Levy Year
Collection Year
Special
381,363.17
2019
2020
Assessment
413,939.44
2020
2021
Revenues*
Net Levy
levy Year
Collection Year
41,303.78
59,584.88
2019
2020
39,353.82
77,196.18
2020
2021
37,403.85
75,576.15
2021
2022
-
114,660.00
2022
2023
-
110,880.00
2023
2024
$426,138.98
112,350.00
2024
2025
113,610.00
2025
2026
114,660.00
2026
2027
$118,061.45 $778,517.21
* Remaining assessment revenues provided by the City of Otsego.
2011A
Less: Equals:
Special
Assessment
Revenues*
Net Levy
Levy Year
Collection Year
73,466.50
381,363.17
2019
2020
70,950.56
413,939.44
2020
2021
68,434.62
421,075.38
2021
2022
56,476.07
174,313.93
2022
2023
54,373.24
179,356.76
2023
2024
52,270.41
178,729.59
2024
2025
50,167.58
193,642.42
2025
2026
-
234,780.00
2026
2027
$426,138.98
$2,177,200.69
* Remaining assessment revenues provided by the City of Otsego.
12860109v1
STATE OF MINNESOTA
COUNTY OF WRIGHT
CITY OF OTSEGO
I, the undersigned, being the duly qualified and acting City Clerk 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 of the City, duly called and held on the
date therein indicated, insofar as the minutes relate to considering proposals and awarding the
sale of $2,950,000 General Obligation Improvement Refunding Bonds, Series 2020A.
WITNESS my hand on October 12, 2020.
City Clerk
128601090