RES 2021-66 Series 2021A Bond GO Water RevenueEXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE
CITY OF OTSEGO, MINNESOTA
HELD: AUGUST 23, 2021
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 August 23,
2021, at 7:00 P.M., for the purpose, in part, of authorizing the issuance and awarding the sale of
$4,345,000 General Obligation Water Revenue Bonds, Series 2021A.
The following members were present: Stocicamp, Dahl, Darkenwald, Goede, and Moores
and the following were absent: none
Member Darlcenwald introduced the following resolution and moved its adoption:
RESOLUTION NO. 2021-66
RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF
$4,345,000 GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 2021A,
PROVIDING FOR THEIR ISSUANCE AND PLEDGING NET REVENUES FOR THE
PAYMENT THEREOF
A. WHEREAS, the City Council of the City of Otsego, Minnesota (the "City") has
heretofore detei�rnined and declared that it is necessary and expedient to issue General Obligation
Water Revenue Bonds, Series 2021A (the "Bonds" or individually, a "Bond"), pursuant to
Minnesota Statutes, Chapter 475 and Section 444.075, to finance construction of a new water
tower (the "Project"); and
B. WHEREAS, the City owns and operates a municipal water utility system (the
"Water System") and a municipal sanitary sewer utility system (the "Sewer System" and together
with the Water System, the "System"), as separate revenue producing public utilities; and
C. WHEREAS, the net revenues of the System are pledged to the payment of the
City's outstanding General Obligation Water and Sewer Revenue Refunding Bonds, Series
2019A, in the original principal amount of $3,525,000, dated December 19, 2019 (the
"Outstanding System Bonds"); and
D. WHEREAS, the City proposes to issue on the same date as the Bonds, a
$7,390,000 General Obligation Water and Sewer Refunding Revenue Bonds, Series 2021B (the
" 2021B Bonds") to current refund General Obligation Water and Sewer Revenue Refunding
Bonds, Series 2010C on December 1, 2021; and the net revenues of the System will be pledged
to the payment of the 2021B Bonds; and
E. WHEREAS, the City has retained Northland Securities, Inc., in Minneapolis,
Minnesota ("Northland"), 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
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Statutes, Section 475.60, Subdivision 2(9) and proposals to purchase the Bonds have been
solicited by Northland; and
F. WHEREAS, the proposals set forth on Exhibit A attached hereto were received
by the Administrator/Finance Director, or designee, at the offices of Northland at 10:00 A.M.,
this same day pursuant to the Preliminary Official Statement for the Bonds dated August 16,
20210 and
G. WHEREAS, it is in the best interests of the City that the Bonds be issued in book -
entry form as hereinafter provided; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Otsego,
Minnesota, as follows:
1. Acceptance of Proposal. The proposal of Robert W. Baird & Co., Inc. (the
"Purchaser"), to purchase the Bonds in accordance with the Notice of Sale, at the rates of interest
hereinafter set forth, and to pay therefor the sum of $4,535,848.38, plus accrued interest accrued
to settlement, is hereby accepted and the Bonds are hereby awarded to the Purchaser.
2. Bond Terms.
(a) Oris�inal Issue Date• Denominations• Maturities; Term Bond Option. The Bonds
shall be dated September 23, 2021, as the date of original issue, be issued forthwith on or after
such date in fully registered form, be numbered from R4 upward in the denomination of $5,000
each or in any integral multiple thereof of a single maturity (the "Authorized Denominations"),
and shall mature on February 1 in the years and amounts as follows:
Year Amount Year Amount
2023 $215,000 2031 $305,000
2024 2505000 2032 3055000
2025 2601000 2033 310,000
2026 265,000 2034 315,000
2027 275,000 2035 3155000
2028 285,000 2036 3251000
2029 29000 2037 330,000
2030 300,000
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) Book Entry Only S sy tern. The Depository Trust Company, a limited purpose
trust company organized under the laws of the State of New Yorlc 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:
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(i) The Bonds shall be initially issued and, so long as they remain in book entry form
only (the "Book 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 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.
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(v) Upon delivery by the Depositary 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 on 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.
(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.
(c) Termination of Book -Entry Only S sy tem. 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.
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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 (c) shall limit or restrict the provisions of paragraph
10.
(d) 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. Pu ose. The Bonds shall provide funds to finance the Project. The total cost of
the Project, which shall include all costs enumerated in Minnesota Statutes, Section 475.65, is
estimated to be at least equal to the amount of the Bonds. Work on the Project shall proceed
with due diligence to completion. The City covenants that it shall do all things and perform all
acts required of it to assure that work on the Project proceeds with due diligence to completion
and that any and all permits and studies required under law for the Project are obtained.
4. Interest. The Bonds shall bear interest payable semiannually on February 1 and
August 1 of each year (each, an "Interest Payment Date"), commencing August 1, 2022,
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
2023
2024
2025
2026
2027
2028
2029
2030
Interest Rate
3.00%
3.00
3.00
3.00
3.00
3.00
3.00
1.00
Maturi Year
2031
2032
2033
2034
2035
2036
2037
Interest Rate
5. Redemption. All Bonds maturing February 1, 2030, and thereafter, shall be
subject to redemption and prepayment at the option of the City on February 1, 2029, and on any
date thereafter at a price of par plus accrued interest. Redemption may be in whole or in part of
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the Bonds subject to prepayment. If redemption is in part, the maturities and the 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. Bonds or portions thereof called for
redemption shall be due and payable on the redemption date, and interest thereon shall cease to
accrue from and after the redemption date. Mailed notice of redemption shall be given to the
paying agent and to each affected registered holder of the Bonds not more than sixty (60) days
and not fewer than thirty (30) days prior to the date fixed for redemption
To effect a partial redemption of Bonds having a common maturity date, the Bond
Registrar prior to giving notice of redemption shall assign to each Bond having a common
maturity date a distinctive number for each $5,000 of the principal amount of such Bond. The
Bond Registrar shall then select by lot, using such method of selection as it shall deem proper in
its discretion, from the numbers so assigned to such Bonds, as many numbers as, at $5,000 for
each number, shall equal the principal amount of such Bonds to be redeemed. The Bonds to be
redeemed shall be the Bonds to which were assigned numbers so selected; provided, however,
that only so much of the principal amount of each such Bond of a denomination of more than
$5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so selected. If
a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar (with, if the
City or Bond Registrar so requires, a written instrument of transfer in form satisfactory to the
City and Bond Registrar duly executed by the Holder thereof or the Holder's attorney duly
authorized in writing) and the City shall execute (if necessary) and the Bond Registrar shall
authenticate and deliver to the Holder of such Bond, without service charge, a new Bond or
Bonds of the same series having the same stated maturity and interest rate and of any Authorized
Denomination or Denominations, as requested by such Holder, in aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the Bond so surrendered.
6. Bond Re ig strar. 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 12.
7. Form of Bond. The Bonds, together with the Bond Registrar's Certificate of
Authentication, the form of Assignment and the registration inforrnation thereon, shall be in
substantially the following f6tm
G
13584738v1
R-
UNITED STATES OF AMERICA
STATE OF MINNESOTA
WRIGHT COUNTY
CITY OF OTSEGO
0
GENERAL OBLIGATION WATER REVENUE BOND, SERIES 2021A
Interest Rate Maturity Date Date of Original Issue CUSIP
February 1, 20 September 23, 2021
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT: DOLLARS
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, unless called for earlier redemption, in the manner hereinafter set forth, the
principal amount specified above, on the maturity date specified above, and to pay interest
thereon semiannually on February 1 and August 1 of each year (each, an "Interest Payment
Date"), commencing August 1, 2022, 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 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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Optional Redemption, The Bonds of this issue (the "Bonds") maturing February 1, 2030,
and thereafter, are subject to redemption and prepayment at the option of the Issuer on February
1, 2029, and on 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
the principal amounts within each maturity to be redeemed shall be determined by the Issuer; 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. Bonds or portions thereof
called for redemption shall be due and payable on the redemption date, and interest thereon shall
cease to accrue from and after the redemption date. Mailed notice of redemption shall be given
to the paying agent and to each affected registered holder of the Bonds not more than sixty (60)
days and not fewer than thirty (30) days prior to the date fixed for redemption.
Prior to the date on which any Bond or Bonds are directed by the Issuer to be redeemed
in advance of maturity, the Issuer will cause notice of the call thereof for redemption identifying
the Bonds to be redeemed to be mailed to the Bond Registrar and all Bondholders, at the
addresses shown on the Bond Register. All Bonds so called for redemption will cease to bear
interest on the specified redemption date, provided funds for their redemption have been duly
deposited.
Selection of Bonds for Redemption; Partial Redemption. To effect a partial redemption
of Bonds having a common maturity date, the Bond Registrar shall assign to each Bond having a
common maturity date a distinctive number for each $5,000 of the principal amount of such
Bond. The Bond Registrar shall then select by lot, using such method of selection as it shall
deem proper in its discretion, from the numbers assigned to the Bonds, as many numbers as, at
$5,000 for each number, shall equal the principal amount of the Bonds to be redeemed. The
Bonds to be redeemed shall be the Bonds to which were assigned numbers so selected; provided,
however, that only so much of the principal amount of such Bond of a denomination of more
than $5,000 shall be redeemed as shall equal $5,000 for each number assigned to it and so
selected. If a Bond is to be redeemed only in part, it shall be surrendered to the Bond Registrar
with, if the Issuer or Bond Registrar so requires, a written instrument of transfer in form
satisfactory to the Issuer and Bond Registrar duly executed by the Holder thereof or the Holder's
attorney duly authorized in writing) and the Issuer shall execute (if necessary) and the Bond
Registrar shall authenticate and deliver to the Holder of the Bond, without service charge, a new
Bond or Bonds of the same series having the same stated maturity and interest rate and of any
Authorized Denomination or Denominations, as requested by the Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of the Bond so
surrendered.
Issuance• Purpose; General Obli ag tion. This Bond is one of an issue in the total principal
amount of $4,345,000, all of like date of original issue and tenor, except as to number, maturity,
interest rate, denomination and redemption privilege, which Bond has been 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 of the Issuer on August 23, 2021 (the "Resolution"), for
the purpose of providing money to finance construction of a new water tower within the
jurisdiction of the Issuer. This Bond is payable out of the General Obligation Water Revenue
Bonds, Series 2021A 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,
13584738v1
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, i Dn 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.
Qualified Tax -Exempt Obli ag tion. This Bond has been designated by the Issuer as
"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; that the
Issuer has covenanted and agreed with the Holders of the Bonds that it will impose and collect
charges for the service, use and availability of the Water System at the times and in amounts
necessary to produce net revenues, together with other sums pledged to the payment of the
Bonds, adequate to pay all principal and interest when due on the Bonds; and that the Issuer will
levy a direct, annual, irrepealable ad valorem tax upon all of the taxable property of the Issuer,
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without limitation as to rate or amount, for the years and in amounts sufficient to pay the
principal and interest on the Bonds of this issue as they respectively become due, if the net
revenues from the Water System, and any other sums irrevocably appropriated to the Debt
Service Account are insufficient therefor; 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 Administrator/Finance Director, the corporate seal of the Issuer having been
intentionally omitted as permitted by law.
Date of Registration: Registrable by: NORTHLAND TRUST SERVICES, INC.
Payable at: NORTHLAND TRUST SERVICES, INC.
CITY OF OTSEGO,
WRIGHT COUNTY, MINNESOTA
BOND REGISTRAR'S
CERTIFICATE OF
AUTHENTICATION
/s/Facsimile
This Bond is one of the Mayor
Bonds described in the
Resolution mentioned
within.
/s/Facsimile f
NORTHLAND TRUST SERVICES, INC. Administrator/Finance D
Minneapolis, Minnesota
Bond Registrar
By:
Authorized Signature
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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
(Gust)
under the
(State)
Transfers to Minors Act
Minor
()
Uniform
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
and does hereby irrevocably constitute and appoint
Bond on the books kept for the registration thereof,
premises.
the within
Bond
attorney to transfer the
with full power of substitution in the
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:
Signatures) 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 inforrnation for ail joint owners if the Bond is held by joint account.)
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8. Execution. The Bonds shall be in typewritten form, shall be executed on behalf of
the City by the signatures of its Mayor and 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
September 23, 2021. 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 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.
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.
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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 wi
rnth 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 Administrator/Finance
Director is hereby authorized to negotiate and execute the terms of said agreement.
11. Ri hg is 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 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 Water Revenue Bonds, Series 2021A 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 City. The Fund
shall be maintained in the manner herein specified until all of the Bonds and the interest thereon
have been fully paid. The Operation and Maintenance Account heretofore established by the
City for the Water System shall continue to be maintained in the manner heretofore provided by
the City. All moneys remaining after paying or providing for the items set forth in the resolution
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135847380
establishing the Operation and Maintenance Account for the Water System shall constitute or are
referred to as "net revenues" until the Bonds have been paid. There shall be established and
maintained accounts of the Fund as follows:
(a) Construction Account. To the Construction Account there shall be credited the
proceeds of the sale of the Bonds. From the Construction Account there shall be paid all costs of
issuance of the Bonds and all costs and expenses of financing the Project, including the cost of
any construction contracts heretofore let and all other costs incurred and to be incurred of the
kind authorized in Minnesota Statutes, Section 475.65. Any balance remaining in the
Construction Account after completion of the Project 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: (1) the net revenues of the Water
System not otherwise pledged and applied to the payment of other obligations of the City, in an
amount, together with other funds which may herein or hereafter from time to time be
irrevocably appropriated to the account sufficient to meet the requirements of Minnesota
Statutes, Section 475.61 for the payment of the principal and interest of the Bonds; (ii) any
collections of all taxes which may hereafter be levied in the event the net revenues and other
Funds herein pledged to the payment of the principal and interest on the Bonds are insufficient
therefor; (iii) all funds remaining in the Construction Account after completion of the Project and
payment of the costs thereof; (iv) all investment earnings on funds held in the Debt Service
Account; and (v) 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. The moneys in the Debt
Service Account shall be used solely to pay the principal of and interest on the Bonds or any
other bonds hereafter issued and made payable from the Fund..
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 Construction
Account or Debt Service Account (or any other City fund or 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 as to yield
shall not be invested at a yield in excess of the applicable yield restrictions imposed by the
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 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").
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16. Coverage Test; Pledge of Net Revenues and Excess Net Revenues. It is hereby
found, determined and declared that the net revenues of the Water System are sufficient in
amount to pay when due the principal of and interest on the Bonds and a sum at least five percent
in excess thereof. It is hereby found, determined and declared that the net revenues of the
System are sufficient in an amount to pay when due the principal and interest on the Outstanding
System Bonds and the 2021B Bonds and a sum at least five percent in excess thereof. The net
revenues of the Water System are hereby pledged on a parity lien with the Outstanding System
Bonds, and the 2021E Bonds and shall be applied for that purpose, but solely to the extent
required to meet, together with other pledged sums, the principal and interest requirements of the
Bonds.
As used herein the term net revenues means the gross revenues derived by the City from
the operation of the Water System, including all charges for service, use, availability, and
connection to the Water System, and all monies received from the sale of any facilities or
equipment of the Water System or any by-products thereof, less all normal, reasonable, or
current costs of owning, operating, and maintaining the Water System. Excess net revenues of
the Water System in excess of those required for the foregoing may be used for any proper
purpose.
Nothing contained herein shall be deemed to preclude the City from making further
pledges and appropriations of the net revenues of the Water System for the payment of other or
additional obligations of the City, provided that it has first been determined by the City Council
that the estimated net revenues of the Water System will be sufficient in addition to all other
sources, for the payment of the Bonds and such additional obligations and any such pledge and
appropriation of the net revenues of the Water System may be made superior or subordinate to,
or on a parity with the pledge and appropriation herein.
17. Covenant to Maintain Rates and Charges. In accordance with Minnesota Statutes,
Section 444.0 75, the City hereby covenants and agrees with the Holders of the Bonds that it will
impose and collect charges for the service, use, availability and connection to the Water System
at the times and in the amounts required to produce net revenues adequate to pay all principal
and interest when due on the Bonds. Minnesota Statutes, Section 444.075, Subdivision 2,
provides as follows: "Real estate tax revenues should be used only, and then on a temporary
basis, to pay general or special obligations when the other revenues are insufficient to meet the
obligations".
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 irrevocably pledged. If the net revenues of the Water System
appropriated and pledged to the payment of principal and interest on the Bonds, together with
other funds irrevocably appropriated to the Debt Service Account shall at any time be
insufficient to pay such principal and interest when due, the City covenants and agrees to levy,
without limitation as to rate or amount an ad valorem tax upon all taxable property in the City
sufficient to pay such principal and interest as it becomes due. If the balance in the Debt Service
Account is ever insufficient to pay all principal and interest then due on the Bonds payable
therefrom, the deficiency shall be promptly paid out of any other accounts of the City which are
15
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available for such purpose, and such other funds may be reimbursed without interest from the
Debt Service Account when a sufficient balance is available therein.
19. 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 discharge its obligations with respect to any prepayable Bonds called
for redemption on any date when they are prepayable according to their terms, by depositing
with the Bond Registrar on or before that date a sum sufficient for the payment thereof in full,
provided that notice of redemption thereof has been duly given. 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.
20. Compliance With Reimbursement Bond Regulations. The provisions of this
paragraph are intended to establish and provide for the City's compliance with United States
Treasury Regulations Section 1.150.2 (the "Reimbursement Regulations") applicable to the
"reimbursement proceeds" of the Bonds, being those portions thereof which will be used by the
City to reimburse itself for any expenditure which the City paid or will have paid prior to the
Closing Date (a "Reimbursement Expenditure").
The City hereby certifies and/or covenants as follow(z:
(a) Not later than sixty days after the date of payment of a Reimbursement Expenditure,
the City (or person designated to do so on behalf of the City) has made or will have made a written
declaration of the City's official intent (a "Declaration") which effectively (i) states the City's
reasonable expectation to reimburse itself for the payment of the Reimbursement Expenditure out
of the proceeds of a subsequent borrowing; (ii) gives a general and functional description of the
property, project or program to which the Declaration relates and for which the Reimbursement
Expenditure is paid, or identifies a specific fund or account of the City and the general functional
purpose thereof fiom which the Reimbursement Expenditure was to be paid (collectively the
"Project"), and (iii) states the maximum principal amount of debt expected to be issued by the City
for the purpose of financing the Project, provided, however, that no such Declaration shall
necessarily have been made with respect to: (1) "preliminary expenditures" for the Project, defined
in the Reimbursement Regulations to include engineering or architectural, surveying and soil
testing expenses and similar prefatory costs, which in the aggregate do not exceed twenty percent
of the "issue price" of the Bonds, and (ii) a de minimis amount of Reimbursement Expenditures
not in excess of the lesser of $100,000 or five percent of the proceeds of the Bonds.
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(b) Each Reimbursement Expenditure is a capital expenditure or a cost of issuance of
the Bonds or any of the other types of expenditures described in Section 1.150-2(d)(3) of the
Reimbursement Regulations.
(c) The "reimbursement allocation" described in the Reimbursement Regulations for
each Reimbursement Expenditure shall and will be made forthwith following (but not prior to) the
issuance of the Bonds, and not later than 18 months after the later of (1) the date of the payment of
the Reimbursement Expenditure, or (ii) the date on which the Project to which the Reimbursement
Expenditure relates is first placed in service, but in no event more than three years after the date
of payment of the Reimbursement Expenditure.
(d) Each such reimbursement allocation will be made in a writing that evidences the
City's use of Bond proceeds to reimburse the Reimbursement Expenditure and, if made within 30
days after the Bonds are issued, shall be treated as made on the day the Bonds are issued.
Provided, however, that the City may take action contrary to any of the foregoing covenants in
this paragraph upon receipt of an opinion of its Bond Counsel for the Bonds stating in effect that
such action will not impair the tax-exempt status of the Bonds.
21. 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 15c2W l2 (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:
(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.
(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 Administrator/Finance Director 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
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to such modifications thereof or additions thereto as are (1) consistent with the requirements
under the Rule, (ii) required by the Purchaser of the Bonds, and (iii) acceptable to the Officers.
22. Certificate of Registration. The Administrator/Finance Director is hereby directed
to file a certified copy of this resolution with the County Auditor of Wright County, Minnesota,
together with such other information as the County Auditor shall require, and to obtain the
County Auditor's certificate that the Bonds have been entered in the County Auditor's Bond
Register.
23. 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.
24. 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.
25. Tax -Exempt Status of the Bonds; 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
(1) 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 City expects to satisfy the twenty-four month exemption for
gross proceeds of the Bonds as provided in Section 1.148-7(e) of the Regulations. The Mayor
and/or the 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.
26. Designation of Qualified Tax -Exempt Obli at�ns. In order to qualify the Bonds
as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Code, the
City hereby makes the following factual statements and representation.
(a) the Bonds are issued after August 7, 1986;
(b) the Bonds are not "private activity bonds" as defined in Section 141 of the Code;
(c) the City hereby designates the Bonds as "qualified tax-exempt obligations" for
purposes of Section 265(b)(3) of the Code;
13584738v1
(d) the reasonably anticipated amount of tax-exempt obligations (other than private
activity bonds, treating qualified 501(c)(3) bonds as not being private activity bonds) which will
be issued by the City (and all entities treated as one issuer with the City, and all subordinate
entities whose obligations are treated as issued by the City) during this calendar year 2021 will
not exceed $10,000,000,
(e) not more than $10,0005000 of obligations issued by the City during this calendar
year 2021 have been designated for purposes of Section 265(b)(3) of the Code; and
(f) the aggregate face amount of the Bonds does not exceed $10,000,0000
The City shall use its best efforts to comply with any federal procedural requirements
which may apply in order to effectuate the designation made by this paragraph.
27. Official Statement. The Official Statement relating to the Bonds prepared and
distributed by Northland is hereby approved and the officers of the City are authorized in
connection with the delivery of the Bonds to sign such certificates as may be necessary with
respect to the completeness and accuracy of the Official Statement,
28. 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.
29. 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
Stockamp and, after a full discussion thereof and upon a vote being taken thereon, the following
voted in favor thereof: Stockamp, Dahl, Darkenwald, Goede, and Moores
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 Clerk of the City %J 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 authorizing the issuance and awarding
the sale of $4,345,000 General Obligation Water Revenue Bonds, Series 2021A.
WITNESS my hand on August 23, 2021.
City Clerk
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EXHIBIT A
TABULATION OF BIDS
CITY OF OTSEGO, NIINNESOTA
$4, 575,000t
GENERAL OBLIGATION WATERREVENUE BONDS, SERIES 2021A
AWARD:
DATE OF SALE:
BIDDER
ROBERT W. BAII2D & CO., INC.
ROBERT W. BAIRD & CO., INC.
MONDAY, AUGUST 23, 2021
AA+
TRUE
PURCHASE NET INTEREST
PRICE INTEREST COST COST (TIC;
$4,780,985,30 $522,376.42 1.3033469%
Milwaukee, WI
Syndicate: C.L. Kind & Assodates; Colliers Securities LLC; ViningSparks IBG, Limited Partnership; Fidelity Capital Markets; Crews &
Aseodates, Inc.; Davenport & Co., L.L.C..; Loop Capital Markets; Country Club Bank; SuntRidge Partners; Sierra Padfic Securities; Ieaak
Bond Investments, Inc.; United Bankers' Bank; Wintrust Investments, LLC; FMS Bonds Inc.; BNYMellon Capital Markets; Midland
Securities; Flrat Southern LLC; InapereX; DlnosaurSecurities; First Bankers' Banc Securities, Inc.; Mountainside Securities LLC; Couunen:e
Bank, N.A.
PIPER SANDLER & CO.
Minneapolis, MN
D.A. DAVIDSON & CO.
Denver, CO
FHN FINANCIAL CAPITAL MARKETS
Memphis, TN
$4,800,491.75 $525,857.81 1.3100944%
$4,780,423.55 $535,596.06 1.3382609%
$4,857,112.98 $566,257.58 1.3980685%
t Paz amount decreased from $4,575,000 to $4,345,000. The adjusted purchase price is $4,535,848.38, plus accmed interest from the date
of issue to the date of delivery, and the adjusted TIC is 1.3130699%.
A-1
13584738v1