Press Alt + R to read the document text or Alt + P to download or print.

No preview available

The URL can be used to link to this page

Home My WebLink About4.d. 1996 Bond Issue - Authorizing Issuance and Setting Bond Sale (1996A) CITY OF ROSEMOUNT EXECUTIVE SUMMARY FOR ACTION CITY COUNCIL MEETING DATE: May 7, 1996 AGENDA ITEM: 1996 Bond Issue -Authorizing Issuance and AGENDA SECTION: Setting Bond Sale (1996A) New Business PREPARED BY: Jeff May, Finance Director AGENDA'1E -n A # n_ ATTACHMENTS: Recommendations, Resolution APPROVED BY: This item is on the agenda for your consideration in authorizing the issuance and setting the sale of General Obligation Fire Station Bonds for the construction of the new fire station approved by referendum in November of 1995. Bids will be opened Tuesday, June 4, 1996, at 11:00 A.M. at the offices of Springsted Incorporated. The bids will be tabulated there, and then consideration for award of the Bonds will be by the City Council at 7:30 P.M., Central Time, of the same day. RECOMMENDED ACTION: Motion to adopt A RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF $1,780,000 GENERAL OBLIGATION FIRE STATION BONDS, SERIES 1996A. COUNCIL ACTION: CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 1996 - A RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF $1,780,000 GENERAL OBLIGATION FIRE STATION BONDS, SERIES 1996A WHEREAS, the City Council of the City of Rosemount, Minnesota, (the "City") has heretofore determined that it is necessary and expedient to issue its $1,780,000 General Obligation Fire Station Bonds, Series 1996A (the "Bonds") to finance the acquisition and construction of a fire station in the City; and WHEREAS, the City has retained Springsted Incorporated, in Saint Paul, Minnesota ("Springsted"), as its independent financial advisor and is therefore authorized to sell these obligations by a competitive negotiated sale in accordance with Minnesota Statutes, Section 475.60, Subdivision 2(9). NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Rosemount, Minnesota, as follows: 1. Authorization; Findings. The City Council hereby authorizes Springsted to solicit bids for the competitive negotiated sale of the Bonds. 2. Meeting: Bid Opening. This City Council shall meet at the time and place specified in the Terms of Proposal attached hereto as Exhibit A for the purpose of considering sealed bids for, and awarding the sale of, the Bonds. The Administrator, or his designee, shall open bids at the time and place specified in such Terms of Proposal. 3. Terms of Proposal. The terms and conditions of the Bonds and the negotiation thereof are fully set forth in the "Terms of Proposal" attached hereto as Exhibit A and hereby approved and made a part hereof. 4. Official Statement. In connection with said competitive negotiated sale, the Administrator and other officers or employees of the City are hereby authorized to cooperate with Springsted and participate in the preparation of an official statement for the Bonds, and to execute and deliver it on behalf of the City upon its completion. RESOLUTION 1996 - ADOPTED this 7th day of May, 1996. Cathy Busho, Mayor ATTEST: Susan M. Walsh, City Clerk Motion by: Seconded by: Voted in favor: Voted Against: • • - EXHIBIT A THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS • ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: TERMS OF PROPOSAL $1,780,000 CITY OF ROSEMOUNT, MINNESOTA GENERAL OBLIGATION FIRE STATION BONDS, SERIES 1996A (BOOK ENTRY ONLY) Proposals for the Bonds will be received on Tuesday, June 4, 1996, until 11:00 A.M., Central Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota, after which time they will be opened and tabulated. Consideration for award of the Bonds will be by the City Council at 7:30 P.M., Central Time, of the same day. SUBMISSION OF PROPOSALS Proposals may be submitted in a sealed envelope or by fax (612) 223-3002 to Springsted. Signed Proposals, without final price or coupons, may be submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting to Springsted the final Proposal price and coupons, by telephone (612) 223-3000 or fax (612) 223-3002 for inclusion in the submitted Proposal. Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the time of sale specified above. Proposals may also be filed electronically via PARITY, in accordance with PARITY Rules of Participation and the Terms of Proposal, within a one-hour period prior to the time of sale established above, but no Proposals will be received after that time. If rovisions in the Terms of Proposal oposal conflict with the PARITY Rules of Participation, the Terms of Proposal shall control. The normal fee for use of PARITY may be obtained from PARITY and such fee shall be the responsibility of the bidder. For further information about PARITY, potential bidders may contact PARITY at 100 116th Avenue SE, Suite 100, Bellevue, Washington 98004, telephone (206) 635-3545. Neither the City nor Springsted Incorporated assumes any liability if there is a malfunction of PARITY. All bidders are advised that each Proposal shall be deemed to constitute a contract between the bidder and the City to purchase the Bonds regardless of the manner of the Proposal submitted. DETAILS OF THE BONDS The Bonds will be dated July 1, 1996, as the date of original issue, and will bear interest payable on February 1 and August 1 of each year, commencing February 1, 1997. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Bonds will mature February 1 in the years and amounts as follows: 1997 $90,000 2002 $65,000 2007 $ 85,000 2012 $110,000 1998 $55,000 2003 $70,000 2008 $ 90,000 2013 $115,000 1999 $60,000 2004 $75,000 2009 $ 95,000 2014 $120,000 2000 $60,000 2005 $75,000 2010 $100,000 2015 $130,000 2001 $65,000 2006 $80,000 2011 $105,000 2016 $135,000 BOOK ENTRY SYSTEM The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, i - f • e representing the aggregate principal amount of the Bonds maturing in each year, will be • registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of$5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. REGISTRAR The City will name the registrar which shall be subject to applicable SEC regulations. The City will pay for the services of the registrar. OPTIONAL REDEMPTION The City may elect on February 1, 2006, and on any day thereafter, to prepay Bonds due on or after February•1, 2007. Redemption may be in whole or in part and if in part at the option of the City and in such manner as the City shall determine. If less than all Bonds of a maturity are called for redemption, the City will notify DTC of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest. SECURITY AND PURPOSE The Bonds will be general obligations of the City for which the City will pledge its full faith and credit and power to levy direct general ad valorem taxes. The proceeds will be used to finance the acquisition and construction of a fire station. TYPE OF PROPOSALS Proposals shall be for not less than $1,750,000 and accrued interest on the total principal amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in the form of a certified or cashier's check or a Financial Surety Bond in the amount of $17,800, payable to the order of the City. If a check is used, it must accompany each proposal. If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central Time, on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement. The City will deposit the check of the purchaser, the amount of which will be deducted at settlement and no interest will accrue to the purchaser. In the event the purchaser fails to comply with the accepted proposal, said amount will be retained by the City. No proposal can be withdrawn or amended after the time set for receiving proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made. Rates shall be in integral multiples of 5/100 or 1/8 of 1%. Rates must be in ascending order. Bonds of the same maturity shall bear a single rate from the date of the Bonds to the date of maturity. No conditional proposals will be accepted. ii - AWARD The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in accordance with customary practice, will be controlling. The City will reserve the right to: (1) waive non-substantive informalities of any proposal or of matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals without cause, and, (iii) reject any proposal which the City determines to have failed to comply with the terms herein. BOND INSURANCE AT PURCHASER'S OPTION If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the option of the underwriter, the purchase of any such insurance policy or the issuance of any such commitment shall be at the sole option and expense of the purchaser of the Bonds. Any increased costs of y e osts o issuance of the Bonds resulting from such purchase of insurance shall be paid by the purchaser, except that, if the City has requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall be the responsibility of the purchaser. Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on the Bonds. CUSIP NUMBERS If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the purchaser. SETTLEMENT Within 40 days following the date of their award, the Bonds will be delivered without cost to the purchaser at a place mutually satisfactory to the City and the purchaser. Delivery will be subject to receipt by the purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-litigation certificate. On the date of settlement payment for the Bonds shall be made in federal, or equivalent, funds which shall be received at the offices of the City or its designee not later than 12:00 Noon, Central Time. Except as compliance with the terms of payment for the Bonds shall have been made impossible by action of the City, or its agents, the purchaser shall be liable to the City for any loss suffered by the City by reason of the purchaser's non-compliance with said terms for payment. CONTINUING DISCLOSURE On the date of the actual issuance and delivery of the Bonds, the City will execute and deliver a Continuing Disclosure Undertaking whereunder the City will covenant to provide, or cause to be provided, annual financial information, including audited financial statements of the City, and notices of certain material events, as specified in and required by SEC Rule 15c2-12(b)(5). OFFICIAL STATEMENT The City has authorized the preparation of an Official Statement containing pertinent information relative to the Bonds, and said Official Statement will serve as a nearly-final Official Statement within the meaning of Rule 15c2-12 of the Securities and Exchange Commission. - iii - • For copies of the Official Statement or for any additional information prior to sale, any prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (612) 223-3000. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than seven business days after the date of such award, it shall provide without cost to the senior managing underwriter of the syndicate to which the Bonds are awarded 70 copies of the Official Statement and the addendum or addenda described above. The City designates the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for purposes of distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. Dated May 7, 1996 BY ORDER OF THE CITY COUNCIL /s/Susan M. Walsh Clerk - iv- Recommendations For City of Rosemount, Minnesota $1,780,000 General Obligation Fire Station Bonds, Series 1996A $1,035,000 General Obligation Storm Water Revenue Bonds, Series 1996B $500,000 General Obligation Water Revenue Bonds, Series 1996C Presented to: Mayor Cathy Busho Members, City Council Mr. Thomas Burt, Administrator Mr. Jeffrey May, Finance Director City of Rosemount 2875 145th Street West Rosemount, MN 55068 SPRINGSTED Public Finance Advisors Study No. R0704B4C4H3 SPRINGSTED Incorporated May 1, 1996 I a RECOMMENDATIONS Re: $1,780,000 General Obligation Fire Station Bonds, Series 1996A $1,035,000 General Obligation Storm Water Revenue Bonds, Series 1996B $500,000 General Obligation Water Revenue Bonds, Series 1996C The Series 1996A Bonds are being issued to finance construction of a new fire station pursuant to a referendum approved by City voters on November 7, 1995. The Series 1996B Bonds are being issued to finance the storm water portion of City Project#266, a street and utility reconstruction project. The Series 1996C Bonds are being issued to finance construction of Well #9. We recommend the following for all series of bonds: 1. Action Requested To establish the date and time of receiving bids and establish the terms and conditions of the offerings. 2. Sale Date and Time Tuesday, June 4, 1996, at 11:00 A.M. with award by the City Council at 7:30 P.M. that same day. 3. Authority for Each Bond Issue The bonds are being issued pursuant to Minnesota Statutes, Chapter 475. Additionally, the Series 1996B and the Series 1996C Bonds are being issued under Minnesota Statutes, Chapter 444. 4. Prepayment Provisions The City may elect on February 1, 2006, and on any day thereafter, to prepay the Series 1996A and Series 1996B Bonds due on or after February 1, 2007 at a price of par plus accrued interest. Due to the short maturity schedule for the Series 1996C Bonds, the Series 1996C Bonds will not be callable in advance of their stated maturities. 5. Credit Rating Comments The City is currently rated "A" by Moody's Investors Service. These issues will require a rating application to assure continuation of the rating. 6. Bank Qualification The City does not expect to issue more than $10,000,000 of tax-exempt obligations in 1996 and therefore these issues will be bank qualified. This will mean lower interest rates for the City than if the bonds were not bank qualified. 7. Rebate Requirements The bonds are subject to the federal arbitrage requirements. However, the City does not expect to issue more than $5,000,000 of tax-exempt debt in 1996. Therefore, the City will be exempt from reporting and rebating arbitrage earnings to the federal government as a small issuer. City of Rosemount, Minnesota May 1, 1996 8. Bona Fide Debt Service Fund The City must maintain bona fide debt service funds for each of the issues or be subject to yield restriction. 9. Economic Life The average life of the issues cannot exceed 120% of the economic life of the projects to be financed. The economic life of the fire station and the storm water and water improvements are all 40 to 50 years. The bonds are therefore within the economic life requirements. 10. Federal Reimbursement Regulations Federal reimbursement regulations require the City to make a declaration, within 60 days of the actual payment, of its intent to reimburse itself from expenses paid prior to the receipt of bond proceeds. It is our understanding the City has taken whatever actions are necessary to comply with the federal reimbursement regulations. 11. Continuing Disclosure These are the City's first issues subject to the new continuing disclosure requirements. The new SEC rules require the City to undertake an annual update of its Official Statement information and report any material events to the national repositories. Springsted provides continuing disclosure services. A summary of the SEC's continuing disclosure requirements has been provided to your staff for informational purposes. 12. Attachments Debt Service Schedules Terms of Proposals DISCUSSION General Obligation Fire Station Bonds, Series 1996A The proceeds of the Series 1996A Bonds are being used to finance the construction of a new fire station pursuant to a referendum approved by City voters on November 7, 1995 by a vote of 1,356 (yes) to 1,203 (no). The principal amount of$1,780,000 consists of$1,750,000 of proceeds to finance construction, which includes the costs of issuance of$21,935, and $30,000 to be used as a discount allowance for underwriters. The first interest payment is due February 1, 1997. Principal is due each February 1, 1997 through 2016 as shown on page 4 of these recommendations. The City made its first levy for this issue in 1995 in the amount of $155,000. The 1995 levy will be used to make the February 1, 1997 payment of principal and interest on the Series 1996A Bonds. Thereafter, each August 1 interest payment will be made from the first-half collections of taxes and each subsequent February 1 principal and interest payment will be made from second-half collections, plus surplus first-half collections. Page 2 City of Rosemount, Minnesota • May 1, 1996 General Obligation Storm Water Revenue Bonds, Series 1996B The proceeds of the Series 1996B Bonds are being used to finance storm water improvements within the City, specifically the storm water portion of City Project #266, a street and utility reconstruction project. The principal amount of$1,035,000 includes: Project Costs $1,001,749 Costs of Issuance 17,726 Allowance for Discount Bidding 15.525 Total Series 1996B Bond Issue $1.035.000 The first interest payment is due February 1, 1997. Principal is due each February 1, 1998 through 2012 as shown on page 5 of these recommendations. The City will repay the Series 1996B Bonds from net revenues of the City's Storm Water Utility, including storm connection fees. The City has recently approved an increase in Storm Water Utility rates equal to $1.50 per quarter per property beginning on July 1, 1996, with a second increase of$1.50 scheduled for January 1, 1998. General Obligation Water Revenue Bonds, Series 1996C The proceeds of the Series 1996C Bonds are being used to finance water improvements within the City, specifically the construction of a new well and pumping facility (Well #9). The principal amount of$500,000 includes: Project Costs $482,810 Costs of Issuance 11,190 Allowance for Discount Bidding 6.000 Total Series 1996C Bond Issue $500.000 The first interest payment is due February 1, 1997. Principal is due each February 1, 1998 through 2005 as shown on page 6 of these recommendations. The City will repay the Series 1996C Bonds from net revenues of the City's Water Utility, including storm connection fees. Respectfully submitted, 4Z67-e/2a SPRINGSTED Incorporated jmc Provided to Staff: a) Summary of Continuing Disclosure Requirements b) Continuing Disclosure Contracts Page 3 CITY OF ROSEMOUNT, MINNESOTA Prepared April 26, 1996 General Obligation Fire Station Bonds, By SPRINGSTED Incorporated Series 1996A Dated: 7- 1-1996 Mature: 2- 1 First Interest: 2- 1 -1997 Total Year of Year of Principal 105% Levy Mat. Principal Rates Interest & Interest of Total (1) (2) (3) (4) (5) (6) (7) 1995 1997 90,000 4.00% 54,014 144,014 151 ,215 1996 1998 55,000 4.15% 88,996 143,996 151 ,196 1997 1999 60,000 4.30% 86,713 146,713 154,049 1998 2000 60,000 4.40% 84,133 144,133 151 ,340 1999 2001 65,000 4.50% 81 ,493 146,493 153,818 2000 2002 65,000 4.60% 78,568 143,568 150,746 2001 2003 70,000 4.75% 75,578 145,578 152,857 2002 2004 75,000 4.85% 72,253 147,253 154,616 2003 2005 75,000 4.95% 68,615 143,615 150,796 2004 2006 80,000 5.05% 64,902 144,902 152,147 2005 2007 85,000 5.15% 60,862 145,862 153,155 2006 2008 90,000 5.25% 56,484 146,484 153,808 2007 2009 95,000 5.35% 51 ,759 146,759 154,097 2008 2010 100,000 5.45% 46,676 146,676 154,010 2009 2011 105,000 5.60% 41 ,226 146,226 153,537 2010 2012 110,000 5.70% 35,346 145,346 152,613 2011 2013 115,000 5.75% 29,076 144,076 151 ,280 2012 2014 120,000 5.80% 22,463 142,463 149,586 2013 2015 130,000 5.85% 15,503 145,503 152,778 2014 2016 135,000 5.85% 7,898 142,898 150,043 TOTALS: 1 ,780,000 1 ,122,558 2,902,558 3,047,687 Bond Years: 20,428.33 Annual Interest: 1 ,122,558 Avg. Maturity: 11 .48 Plus Discount: 30,000 Avg. Annual Rate: 5.495% Net Interest: 1 ,152,558 T.I.C. Rate: 5.663% N.I.C. Rate: 5.642% Interest rates are estimates; changes may cause significant alterations of this schedule. The actual underwriter's discount bid may also vary. Page 4 CITY OF ROSEMOUNT, MINNESOTA Prepared April 23, 1996 ''General Obligation Storm Water Bonds, By SPRINGSTED Incorporated Series 1996B Dated: 7- 1-1996 Mature: 2- 1 First Interest: 2- 1 -1997 Total Existing Total Year of Year of Principal Storm Water Debt 1 Revenue Mat. Principal Rates Interest & Interest Debt Service (1 ) (2) (3) (4) (5) (6) (7) (8) 1996 1997 0 0.00% 30,372 30,372 195,295 225,667 1997 1998 50,000 4.15% 52,067 102,067 195,532 297,599 1 1998 1999 50,000 4.30% 49,992 99,992 195,295 295,287 1999 2000 55,000 4.40% 47,842 102,842 194,605 297,447 2000 2001 55,000 4.50% 45,422 100,422 198,450 298,872 2001 2002 60,000 4.60% 42,947 102,947 196,647 299,594 2002 2003 60,000 4.75% 40,187 100,187 194,448 294,635 2003 2004 65,000 4.85% 37,337 102,337 196,760 299,097 2004 2005 65,000 4.95% 34,184 99,184 198,320 297,504 2005 2006 70,000 5.05% 30,966 100,966 159,165 260,131 2006 2007 75,000 5.15% 27,431 102,431 156,605 259,036 2007 2008 80,000 5.25% 23,568 103,568 158,625 262,193 2008 2009 80,000 5.35% 19,368 99,368 0 99,368 2009 2010 85,000 5.45% 15,088 100,088 0 100,088 2010 2011 90,000 5.60% 10,455 100,455 0 100,455 2011 2012 95,000 5.70% 5,415 100,415 0 100,415 TOTALS: 1 ,035,000 512,641 1 ,547,641 2,239,747 3,787,388 1 Bond Years: 9,783.75 Annual Interest: 512,641 Avg. Maturity: 9.45 Plus Discount: 15,525 Avg. Annual Rate: 5.240% Net Interest: 528,166 T.I.C. Rate: 5.418% N.I.C. Rate: 5.398% Interest rates are estimates; changes may cause significant alterations of this schedule. The actual underwriter's discount bid may also vary. Page 5 CITY OF ROSEMOUNT, MINNESOTA Prepared April 23, 1996 'General Obligation Water Revenue Bonds, By SPRINGSTED Incorporated Series 1996C Dated: 7- 1-1996 Mature: 2- 1 First Interest: 2- 1 -1997 Total Existing Total Year of Year of Principal Water Debt Revenue Mat. Principal Rates Interest & Interest Debt Service (1) (2) (3) (4) (5) (6) (7) (8) 1996 1997 0 0.00% 13,374 13,374 156,633 170,007 1997 1998 55,000 4.15% 22,926 77,926 142,160 220,086 1998 1999 55,000 4.30% 20,643 75,643 143,410 219,053 1999 2000 60,000 4.40% 18,278 78,278 144,210 222,488 2000 2001 60,000 4.50% 15,638 75,638 144,590 220,228 2001 2002 65,000 4.60% 12,938 77,938 144,645 222,583 2002 2003 65,000 4.75% 9,948 74,948 144,245 219,193 2003 2004 70,000 4.85% 6,860 76,860 143,370 220,230 2004 2005 70,000 4.95% 3,465 73,465 147,000 220,465 TOTALS: 500,000 124,070 624,070 1 ,310,263 1 ,934,333 Bond Years: 2,641 .67 Annual Interest: 124,070 Avg. Maturity: 5.28 Plus Discount: 6,000 Avg. Annual Rate: 4.697% Net Interest: 130,070 T.I.C. Rate: 4.951% N.I.C. Rate: 4.924% Interest rates are estimates; changes may cause significant alterations of this schedule. The actual underwriter's discount bid may also vary. Page 6 THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: TERMS OF PROPOSAL $1,780,000 CITY OF ROSEMOUNT, MINNESOTA GENERAL OBLIGATION FIRE STATION BONDS, SERIES 1996A (BOOK ENTRY ONLY) Proposals for the Bonds will be received on Tuesday, June 4, 1996, until 11:00 A.M., Central Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota, after which time they will be opened and tabulated. Consideration for award of the Bonds will be by the City Council at 7:30 P.M., Central Time, of the same day. SUBMISSION OF PROPOSALS Proposals may be submitted in a sealed envelope or by fax (612) 223-3002 to Springsted. Signed Proposals, without final price or coupons, may be submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting to Springsted the final Proposal price and coupons, by telephone (612) 223-3000 or fax (612) 223-3002 for inclusion in the submitted Proposal. Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the time of sale specified above. Proposals may also be filed electronically via PARITY, in accordance with PARITY Rules of Participation and the Terms of Proposal, within a one-hour period prior to the time of sale established above, but no Proposals will be received after that time. If provisions in the Terms of Proposal conflict with the PARITY Rules of Participation, the Terms of Proposal shall control. The normal fee for use of PARITY may be obtained from PARITY and such fee shall be the responsibility of the bidder. For further information about PARITY, potential bidders may contact PARITY at 100 116th Avenue SE, Suite 100, Bellevue, Washington 98004, telephone (206) 635-3545. Neither the City nor Springsted Incorporated assumes any liability if there is a malfunction of PARITY. All bidders are advised that each Proposal shall be deemed to constitute a contract between the bidder and the City to purchase the Bonds regardless of the manner of the Proposal submitted. DETAILS OF THE BONDS The Bonds will be dated July 1, 1996, as the date of original issue, and will bear interest payable on February 1 and August 1 of each year, commencing February 1, 1997. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Bonds will mature February 1 in the years and amounts as follows: 1997 $90,000 2002 $65,000 2007 $ 85,000 2012 $110,000 1998 $55,000 2003 $70,000 2008 $ 90,000 2013 $115,000 1999 $60,000 2004 $75,000 2009 $ 95,000 2014 $120,000 2000 $60,000 2005 $75,000 2010 $100,000 2015 $130,000 2001 $65,000 2006 $80,000 2011 $105,000 2016 $135,000 BOOK ENTRY SYSTEM The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, Page 7 } representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of$5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. REGISTRAR The City will name the registrar which shall be subject to applicable SEC regulations. The City will pay for the services of the registrar. OPTIONAL REDEMPTION The City may elect on February 1, 2006, and on any day thereafter, to prepay Bonds due on or after February 1, 2007. Redemption may be in whole or in part and if in part at the option of the City and in such manner as the City shall determine. If less than all Bonds of a maturity are called for redemption, the City will notify DTC of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest. SECURITY AND PURPOSE The Bonds will be general obligations of the City for which the City will pledge its full faith and credit and power to levy direct general ad valorem taxes. The proceeds will be used to finance the acquisition and construction of a fire station. TYPE OF PROPOSALS Proposals shall be for not less than $1,750,000 and accrued interest on the total principal amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in the form of a certified or cashier's check or a Financial Surety Bond in the amount of $17,800, payable to the order of the City. If a check is used, it must accompany each proposal. If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central Time, on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement. The City will deposit the check of the purchaser, the amount of which will be deducted at settlement and no interest will accrue to the purchaser. In the event the purchaser fails to comply with the accepted proposal, said amount will be retained by the City. No proposal can be withdrawn or amended after the time set for receiving proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made. Rates shall be in integral multiples of 5/100 or 1/8 of 1%. Rates must be in ascending order. Bonds of the same maturity shall bear a single rate from the date of the Bonds to the date of maturity. No conditional proposals will be accepted. Page 8 AWARD The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in accordance with customary practice, will be controlling. The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals without cause, and, (iii) reject any proposal which the City determines to have failed to comply with the terms herein. BOND INSURANCE AT PURCHASER'S OPTION If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the option of the underwriter, the purchase of any such insurance policy or the issuance of any such commitment shall be at the sole option and expense of the purchaser of the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance shall be paid by the purchaser, except that, if the City has requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall be the responsibility of the purchaser. Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on the Bonds. CUSIP NUMBERS If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the purchaser. SETTLEMENT Within 40 days following the date of their award, the Bonds will be delivered without cost to the purchaser at a place mutually satisfactory to the City and the purchaser. Delivery will be subject to receipt by the purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-litigation certificate. On the date of settlement payment for the Bonds shall be made in federal, or equivalent, funds which shall be received at the offices of the City or its designee not later than 12:00 Noon, Central Time. Except as compliance with the terms of payment for the Bonds shall have been made impossible by action of the City, or its agents, the purchaser shall be liable to the City for any loss suffered by the City by reason of the purchaser's non-compliance with said terms for payment. CONTINUING DISCLOSURE On the date of the actual issuance and delivery of the Bonds, the City will execute and deliver a Continuing Disclosure Undertaking whereunder the City will covenant to provide, or cause to be provided, annual financial information, including audited financial statements of the City, and notices of certain material events, as specified in and required by SEC Rule 15c2-12(b)(5). OFFICIAL STATEMENT The City has authorized the preparation of an Official Statement containing pertinent information relative to the Bonds, and said Official Statement will serve as a nearly-final Official Statement within the meaning of Rule 15c2-12 of the Securities and Exchange Commission. Page 9 For copies of the Official Statement or for any additional information prior to sale, any prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (612) 223-3000. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than seven business days after the date of such award, it shall provide without cost to the senior managing underwriter of the syndicate to which the Bonds are awarded 70 copies of the Official Statement and the addendum or addenda described above. The City designates the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for purposes of distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. Dated May 7, 1996 BY ORDER OF THE CITY COUNCIL /s/Susan M. Walsh Clerk Page 10 i THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: TERMS OF PROPOSAL $1,035,000 CITY OF ROSEMOUNT, MINNESOTA GENERAL OBLIGATION STORM WATER REVENUE BONDS, SERIES 1996B (BOOK ENTRY ONLY) Proposals for the Bonds will be received on Tuesday, June 4, 1996, until 11:00 A.M., Central Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota, after which time they will be opened and tabulated. Consideration for award of the Bonds will be by the City Council at 7:30 P.M., Central Time, of the same day. SUBMISSION OF PROPOSALS Proposals may be submitted in a sealed envelope or by fax (612) 223-3002 to Springsted. Signed Proposals, without final price or coupons, may be submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting to Springsted the final Proposal price and coupons, by telephone (612) 223-3000 or fax (612) 223-3002 for inclusion in the submitted Proposal. Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the time of sale specified above. Proposals may also be filed electronically via PARITY, in accordance with PARITY Rules of Participation and the Terms of Proposal, within a one-hour period prior to the time of safe established above, but no Proposals will be received after that time. If provisions in the Terms of Proposal conflict with the PARITY Rules of Participation, the Terms of Proposal shall control. The normal fee for use of PARITY may be obtained from PARITY and such fee shall be the responsibility of the bidder. For further information about PARITY, potential bidders may contact PARITY at 100 116th Avenue SE, Suite 100, Bellevue, Washington 98004, telephone (206) 635-3545. Neither the City nor Springsted Incorporated assumes any liability if there is a malfunction of PARITY. All bidders are advised that each Proposal shall be deemed to constitute a contract between the bidder and the City to purchase the Bonds regardless of the manner of the Proposal submitted. DETAILS OF THE BONDS The Bonds will be dated July 1, 1996, as the date of original issue, and will bear interest payable on February 1 and August 1 of each year, commencing February 1, 1997. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Bonds will mature February 1 in the years and amounts as follows: 1998 $50,000 2002 $60,000 2006 $70,000 2010 $85,000 1999 $50,000 2003 $60,000 2007 $75,000 2011 $90,000 2000 $55,000 2004 $65,000 2008 $80,000 2012 $95,000 2001 $55,000 2005 $65,000 2009 $80,000 BOOK ENTRY SYSTEM The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate principal amount of the Bonds maturing in each year, will be Page 11 registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. REGISTRAR The City will name the registrar which shall be subject to applicable SEC regulations. The City will pay for the services of the registrar. OPTIONAL REDEMPTION The City may elect on February 1, 2006, and on any day thereafter, to prepay Bonds due on or after February 1, 2007. Redemption may be in whole or in part and if in part at the option of the City and in such manner as the City shall determine. If less than all Bonds of a maturity are called for redemption, the City will notify DTC of the particular amount of such maturity to be prepaid. DTC will determine by lot the amount of each participant's interest in such maturity to be redeemed and each participant will then select by lot the beneficial ownership interests in such maturity to be redeemed. All prepayments shall be at a price of par plus accrued interest. SECURITY AND PURPOSE The Bonds will be general obligations of the City for which the City will pledge its full faith and credit and power to levy direct general ad valorem taxes. In addition the City will pledge net revenues of the City's Storm Water Utility. The proceeds will be used to finance construction of storm water improvements within the City. TYPE OF PROPOSALS Proposals shall be for not less than $1,019,475 and accrued interest on the total principal amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in the form of a certified or cashier's check or a Financial Surety Bond in the amount of $10,350, payable to the order of the City. If a check is used, it must accompany each proposal. If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is required to submit its Deposit to Springsted Incorporated in the form of a certified or cashiers check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central Time, on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement. The City will deposit the check of the purchaser, the amount of which will be deducted at settlement and no interest will accrue to the purchaser. In the event the purchaser fails to comply with the accepted proposal, said amount will be retained by the City. No proposal can be withdrawn or amended after the time set for receiving proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made. Rates shall be in integral multiples of 5/100 or 1/8 of 1%. Rates must be in ascending order. Bonds of the same maturity shall bear a single rate from the date of the Bonds to the date of maturity. No conditional proposals will be accepted. Page 12 AWARD The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in accordance with customary practice, will be controlling. The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals without cause, and, (iii) reject any proposal which the City determines to have failed to comply with the terms herein. BOND INSURANCE AT PURCHASER'S OPTION If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the option of the underwriter, the purchase of any such insurance policy or the issuance of any such commitment shall be at the sole option and expense of the purchaser of the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance shall be paid by the purchaser, except that, if the City has requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall be the responsibility of the purchaser. Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on the Bonds. CUSIP NUMBERS If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the purchaser. SETTLEMENT Within 40 days following the date of their award, the Bonds will be delivered without cost to the purchaser at a place mutually satisfactory to the City and the purchaser. Delivery will be subject to receipt by the purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-litigation certificate. On the date of settlement payment for the Bonds shall be made in federal, or equivalent, funds which shall be received at the offices of the City or its designee not later than 12:00 Noon, Central Time. Except as compliance with the terms of payment for the Bonds shall have been made impossible by action of the City, or its agents, the purchaser shall be liable to the City for any loss suffered by the City by reason of the purchaser's non-compliance with said terms for payment. CONTINUING DISCLOSURE On the date of the actual issuance and delivery of the Bonds, the City will execute and deliver a Continuing Disclosure Undertaking whereunder the City will covenant to provide, or cause to be provided, annual financial information, including audited financial statements of the City, and notices of certain material events, as specified in and required by SEC Rule 15c2-12(b)(5). OFFICIAL STATEMENT The City has authorized the preparation of an Official Statement containing pertinent information relative to the Bonds, and said Official Statement will serve as a nearly-final Official Statement within the meaning of Rule 15c2-12 of the Securities and Exchange Commission. Page 13 For copies of the Official Statement or for any additional information prior to sale, any prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (612) 223-3000. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than seven business days after the date of such award, it shall provide without cost to the senior managing underwriter of the syndicate to which the Bonds are awarded 40 copies of the Official Statement and the addendum or addenda described above. The City designates the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for purposes of distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. Dated May 7, 1996 BY ORDER OF THE CITY COUNCIL /s/Susan M. Walsh Clerk Page 14 THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THIS ISSUE ON ITS BEHALF. PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: TERMS OF PROPOSAL $500,000 CITY OF ROSEMOUNT, MINNESOTA GENERAL OBLIGATION WATER REVENUE BONDS, SERIES 1996C (BOOK ENTRY ONLY) Proposals for the Bonds will be received on Tuesday, June 4, 1996, until 11:00 A.M., Central Time, at the offices of Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota, after which time they will be opened and tabulated. Consideration for award of the Bonds will be by the City Council at 7:30 P.M., Central Time, of the same day. SUBMISSION OF PROPOSALS Proposals may be submitted in a sealed envelope or by fax (612) 223-3002 to Springsted. Signed Proposals, without final price or coupons, may be submitted to Springsted prior to the time of sale. The bidder shall be responsible for submitting to Springsted the final Proposal price and coupons, by telephone (612) 223-3000 or fax (612) 223-3002 for inclusion in the submitted Proposal. Springsted will assume no liability for the inability of the bidder to reach Springsted prior to the time of sale specified above. Proposals may also be filed electronically via PARITY, in accordance with PARITY Rules of Participation and the Terms of Proposal, within a one-hour period prior to the time of sale established above, but no Proposals will be received after that time. If provisions in the Terms of Proposal conflict with the PARITY Rules of Participation, the Terms of Proposal shall control. The normal fee for use of PARITY may be obtained from PARITY and such fee shall be the responsibility of the bidder. For further information about PARITY, potential bidders may contact PARITY at 100 116th Avenue SE, Suite 100, Bellevue, Washington 98004, telephone (206) 635-3545. Neither the City nor Springsted Incorporated assumes any liability if there is a malfunction of PARITY. All bidders are advised that each Proposal shall be deemed to constitute a contract between the bidder and the City to purchase the Bonds regardless of the manner of the Proposal submitted. DETAILS OF THE BONDS The Bonds will be dated July 1, 1996, as the date of original issue, and will bear interest payable on February 1 and August 1 of each year, commencing February 1, 1997. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Bonds will mature February 1 in the years and amounts as follows: 1998 $55,000 2001 $60,000 2004 $70,000 1999 $55,000 2002 $65,000 2005 $70,000 2000 $60,000 2003 $65,000 BOOK ENTRY SYSTEM The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases Page 15 of the Bonds may be made in the principal amount of$5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. REGISTRAR The City will name the registrar which shall be subject to applicable SEC regulations. The City will pay for the services of the registrar. OPTIONAL REDEMPTION The Bonds will not be subject to payment in advance of their respective stated maturity dates. SECURITY AND PURPOSE The Bonds will be general obligations of the City for which the City will pledge its full faith and credit and power to levy direct general ad valorem taxes. In addition the City will pledge net revenues of the City's Water Utility. The proceeds will be used to finance construction of a new water well and pumping facility. TYPE OF PROPOSALS Proposals shall be for not less than $494,000 and accrued interest on the total principal amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in the form of a certified or cashier's check or a Financial Surety Bond in the amount of $5,000, payable to the order of the City. If a check is used, it must accompany each proposal. If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Minnesota, and preapproved by the City. Such bond must be submitted to Springsted Incorporated prior to the opening of the proposals. The Financial Surety Bond must identify each underwriter whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are awarded to an underwriter using a Financial Surety Bond, then that purchaser is required to submit its Deposit to Springsted Incorporated in the form of a certified or cashier's check or wire transfer as instructed by Springsted Incorporated not later than 3:30 P.M., Central Time, on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond may be drawn by the City to satisfy the Deposit requirement. The City will deposit the check of the purchaser, the amount of which will be deducted at settlement and no interest will accrue to the purchaser. In the event the purchaser fails to comply with the accepted proposal, said amount will be retained by the City. No proposal can be withdrawn or amended after the time set for receiving proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made. Rates shall be in integral multiples of 5/100 or 1/8 of 1%. Rates must be in ascending order. Bonds of the same maturity shall bear a single rate from the date of the Bonds to the date of maturity. No conditional proposals will be accepted. AWARD The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis. The City's computation of the interest rate of each proposal, in accordance with customary practice, will be controlling. The City will reserve the right to: (i) waive non-substantive informalities of any proposal or of matters relating to the receipt of proposals and award of the Bonds, (ii) reject all proposals without cause, and, (iii) reject any proposal which the City determines to have failed to comply with the terms herein. Page 16 CUSIP NUMBERS If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto will constitute cause for failure or refusal by the purchaser to accept delivery of the Bonds. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the purchaser. SETTLEMENT Within 40 days following the date of their award, the Bonds will be delivered without cost to the purchaser at a place mutually satisfactory to the City and the purchaser. Delivery will be subject to receipt by the purchaser of an approving legal opinion of Briggs and Morgan, Professional Association, of Saint Paul and Minneapolis, Minnesota, and of customary closing papers, including a no-litigation certificate. On the date of settlement payment for the Bonds shall be made in federal, or equivalent, funds which shall be received at the offices of the City or its designee not later than 12:00 Noon, Central Time. Except as compliance with the terms of payment for the Bonds shall have been made impossible by action of the City, or its agents, the purchaser shall be liable to the City for any loss suffered by the City by reason of the purchaser's non-compliance with said terms for payment. CONTINUING DISCLOSURE On the date of the actual issuance and delivery of the Bonds, the City will execute and deliver a Continuing Disclosure Undertaking whereunder the City will covenant to provide, or cause to be provided, annual financial information, including audited financial statements of the City, and notices of certain material events, as specified in and required by SEC Rule 15c2-12(b)(5). OFFICIAL STATEMENT The City has authorized the preparation of an Official Statement containing pertinent information relative to the Bonds, and said Official Statement will serve as a nearly-final Official Statement within the meaning of Rule 15c2-12 of the Securities and Exchange Commission. For copies of the Official Statement or for any additional information prior to sale, any prospective purchaser is referred to the Financial Advisor to the City, Springsted Incorporated, 85 East Seventh Place, Suite 100, Saint Paul, Minnesota 55101, telephone (612) 223-3000. The Official Statement, when further supplemented by an addendum or addenda specifying the maturity dates, principal amounts and interest rates of the Bonds, together with any other information required by law, shall constitute a "Final Official Statement" of the City with respect to the Bonds, as that term is defined in Rule 15c2-12. By awarding the Bonds to any underwriter or underwriting syndicate submitting a proposal therefor, the City agrees that, no more than seven business days after the date of such award, it shall provide without cost to the senior managing underwriter of the syndicate to which the Bonds are awarded 20 copies of the Official Statement and the addendum or addenda described above. The City designates the senior managing underwriter of the syndicate to which the Bonds are awarded as its agent for purposes of distributing copies of the Final Official Statement to each Participating Underwriter. Any underwriter delivering a proposal with respect to the Bonds agrees thereby that if its proposal is accepted by the City (i) it shall accept such designation and (ii) it shall enter into a contractual relationship with all Participating Underwriters of the Bonds for purposes of assuring the receipt by each such Participating Underwriter of the Final Official Statement. Dated May 7, 1996 BY ORDER OF THE CITY COUNCIL /s/Susan M. Walsh Clerk Page 17