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HomeMy WebLinkAbout1993-218 e CERTIFICATION OF MINUTES RELATING TO $1,055,000 GENERAL OBLIGATION IMPROVEMENT REFUNDING BONDS, SERIES 1994A Issuer: City of Stillwater, Minnesota Governing Body: City Council Kind, date, time and place of meeting: A regular meeting held on November 16, 1993, at o'clock P,M, at City Hall Members present: Members absent: Documents Attached: Minutes of said meeting (pages): RESOLUTION NO, RESOLUTION AUTHORIZING ISSUANCE AND SALE OF $1,055,000 GENERAL OBLIGATION IMPROVEMENT REFUNDING BONDS, SERIES 1994A TERMS OF PROPOSAL 4It I, the undersigned, being the duly qualified and acting recording officer of the public corporation issuing the bonds referred to in the title of this certificate, certify that the documents attached hereto, as described above, have been carefully compared with the original records of said corporation in my legal custody, from which they have been transcribed; that said documents are a correct and complete transcript of the minutes of a meeting of the governing body of said corporation, and correct and complete copies of all resolutions and other actions taken and of all documents approved by the governing body at said meeting, so far as they relate to said bonds; and that said meeting was duly held by the governing body at the time and place and was attended throughout by the members indicated above, pursuant to call and notice of such meeting given as required by law, this WITNESS my hand officially as such recording officer day of November, 1993, City Clerk . Member introduced the following resolution and moved tts adoption: RESOLUTION AUTHO~IZING ISSUANCE AND SALE OF $1,055,000 GENERAL OBLIGATItN IMPROVEMENT REFUNDING BONDS, SERIES 1994A BE IT RESOL~ED by the City Council of City of Stillwater, Minnesota I (the Issuer), as follows: Section 1, I Authorization, The Issuer presently has outstanding the folIo ing issue of general obligation bonds issued pursuant to Minnesota Statutes, Chapters 429 and 475: Title General Obligation Improvement Bonds, Series 1984A The Issuer presently debt service savings through 2005 maturiti $3,720,000 in princip accordance with Minne hereby authorizes the amount of General ObI 1994A (the Bonds), th moneys of the Issuer Section 2, financial consultant a form of Terms of Pr and hereby approved a Each and all of the p adopted as the terms thereof, Springsted advisers, pursuant to Subdivision 2, paragr for the Bonds on beha Section 3. the time and place sh of considering sealed taking such action th City, The motion was duly seconded by taken thereon, the fo e Date of Issue Original Principal Amount 10/1/84 $4,850,000 stimates that it can effect a substantial y refunding on February 1, 1994, the 1995 s of said outstanding bonds, which aggregate I amount, in advance of their maturity in ota Statutes, Section 475,67, The Issuer issuance and sale of $1,055,000 principal gation Improvement Refunding Bonds, Series proceeds of which, together with other s required, shall be used for this purpose, e Terms of Proposal, Springsted Incorporated, o the Issuer, has presented to this Council posal for the Bonds which is attached hereto d shall be placed on file by the Clerk, ovisions of the Terms of Proposal are hereby nd conditions of the Bonds and of the sale ncorporated, as independent financial Minnesota Statutes, Section 475,60, ph (9) is hereby authorized to solicit bids f of the Issuer on a negotiated basis, Sale Meeting, This Council shall meet at wn in the Terms of Proposal, for the purpose bids for the purchase of the Bonds and of reon as may be in the best interests of the adoption of the foregoing resolution and upon vote being voted in favor thereof: and the following vot d against the same: whereupon the resolut on was declared duly passed and adopted, . I' : I , , , :e e .e THE CITY HAS AUTHORIZED SPRINGSTED INCORPORATED TO NEGOTIATE THiS iSSUE ON ITS BEHALF, PROPOSALS WILL BE RECEIVED ON THE FOLLOWING BASIS: TERMS OF PROPOSAL $1,055,000 CllY OF STILLWATER, MINNESOTA GENERAL OBLIGATION IMPROVEMENT REFUNDING SONOS, SERIES 1994A Proposals for the Bonds will be received on Tuesday, December 14, 1993, until 11 :30 A.M., Central Tim(\ at the offices of Springsted Incorporated, 85 East Seventh Place, Suite) 10C, Saint Paul, Minnesota. after which time they will be opened and tabulated. Consideration for aWiard of the Bonds will be by the City Council at 7:00 P,M" Central Time, of the same day. DETAILS OF THE BONDS The Bonds will be dated January 1, 1994, as the date 01 original issue, and will bear interest payable on February 1 and August 1 of each year, commencing August 1, 1994, Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Bonds will be issued in the denomination of $5,000 each, or in integra! multiples thereof, as requastCld by the purchaser, and fully registered as to principal and interest. Principal will be payable at the maIn corporate office of the registrar and interest on each Bond will be payablo by check or draft of the registrar mailed to the registered holder thereof at the holder's address as it appears on the books of the registrar as of the close of business on the 15th day of the immediately preceding month. The Bonds will mature February 1 in the years and amounts as follows: 1996 $ 90,000 1997 $ 90,000 1998 $ 95,000 1999 $100.000 2000 $105,000 2001 $105,000 , 2002 $1 10,000 2003 $115,000 2004 $120,000 2005 $125.000 OPTIONAL REDEMPTION The City may elect on February 1, 2002, and on any day thereafter, to prepay Bonds due or, 0; attar February 1, 2003, Redemption may be in whole or in part and if in part. at the option of the City and in such order as the City shall dotermine and within a maturity by lot as sele.cted oy the registrar, 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 :pecal! assessments against benefited property, The proceeds will be used to ref Lind the 1995 through 2005 maturities of the City's $4,850,000 General Obligation Improvement Bonds. Series 1984A, dated October 1, 1984. TYPE OF PROPOSALS Proposals snail be for not less than $1,044,450 and accrued interest on the total princ;p.J1 amount of the Bonds, Proposals shall be accompanied by a Good Faith Deposit ("Deposit") In . i - the form of a certified or cas~ier'S check or a Financial Surety Bond in the amount of $10,550, e payable to the order of the ~ity, If a check is used, It must accompany each proposal. If a Financial Surety Bond is use~, it must be from an insurance company licensed to issue such a bond in the State of Minneso a, and preapproved by the City. Such bond must be Submitted to SpringsteCl Incorporated pri r to the opening of the proposals. The Financial Surety Bond must identify each underwrit r whose Deposit is guaranteed by such Financial Surety Bond_ If the Bonds are awarded to a underwriter using a Financial Surety Bond, then that purchaser is required to submit its Deposi to Springsted Incorporated in the farm Of a certified or cashier's check or wire transfer as I structed by Sprlngsted Incorporated not later than 3;30 P,M., Central Time, on the next bu iness day following the award. If such Deposit is not rocelved by that time, the Financial Su ety Bond may be drawn by the City to satisfy the Deposit requirement. The City will eposit the check of the purchaser, the amount of which will be deducted <>t settlement and 0 interest will accru'e to the purchaser. In the evant the purchaser fails to comply with the ac epted proposal, said amount will be retained by the City. No proposal can be withdrawn r amended after the time set for receiving proposals unless the meeting of the City schedule 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 ot 5/100 or 1/8 of , %. Rates must be in ascending order, Bonds of the same maturity shall bear a single rate from the date 01 the Bonds to the date of maturity. No conditional proposals will be ccepted, AWARD The Bonds will be awarded n the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis, he City's computation 01 the interest rate of each proposal, in accordance with customary wactice, will be controlling. The City wi!! reserve the righ. to: (i) waive non-substantive informalities of any proposal or of matters relating to the recei t of proposals and award of the Bonds, (ii) reject all proposals without cause, and, (Hi) reje any proposal which the City determines to have failed to comply with the terms herein, e BON11NSURANCE AT PURCHASER'S OPTION If the Bonds quali~' for issu nce of any policy of municipal bond insurance or commitment therefor at the option of th underwriter, the purchase of any such insurance policy or the issuance of 3ny such commi~ment shall be at the sole option and expense of the purchaser of the Bonds, Any increased ~osts of Issuance of the Bonds resulting from such purchase of in. surance shall be paid by th+. purchaser, except that, if the City has requested and received a rating on the Bonds from a ating agency, the City will pay that rating fee. Any other rating agency fees shall be the res onsibillty of the purchaser. Failure of th~ municipal bon1lnsurer to issue the polley after Bonds have been awarded to the purchaser shall not constltut cause for failure or refusal by the purchaser to accept delivery on the Bonds. REGISTRAR The City will name the registr r which shall be subject to applicable SEe regulations. The City will pay for the services of th registrar. CUSIP NUMBERS If the Bonds quality for assl nment of CUSIP numbers such numbers will be printed on the A Bonds, but neither the failur to print such numbers on any BCi"\d ()or any' error with respect .. thereto will constitute cause for failure or refusal by the purchasor to accept delivery of the Bonds. The CUS!? Service ureau charge for the assignment of CUSIP identification numbers shall be palo by the purchas r. . e e e .. SETTLEMENT Within 40 days following the date of ~heir award, the Bonds will be delivered without cost to the purchaser at ;3 place mutually satisfactory to the City and the purchaser. Delivery will be subject to receipt by the purchaser of an approving legal opinion of Dorsey & Whitney of Minneapolis, Minnesota, which opinion will be printed on the Bonds, 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 ot 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 p~yment. 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 J. nearly-final Official Statement within the meaning of Rule ,5c2.12 of the Securities and Exchange Commission. For copiCls 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 lnlormation required by law, shall constitute a "Final Official Statement" of thIS City with respect to the Bonds, as that term is defined In Rule 1 5c2-' 2, By awarding the Bonds to any Undel"Nriter or under-Nritlng syndicate submitting a proposal therefor, the City agrees that, no more than ~9ven business: days after the date of such award, it shall provide without cost to the senior managing underNriter of the syndicate to which the Bonds are awarded 40 copies of the Official Statement and the addendum or addenda described abovs. The City designates tha .::enior managing u!:derwriter of the syndicate to which the Bonds are awarded as its agent :or purposes of dl<:rtributing copies of the Final Official Statement to each Participating Underwl it.sr. Any underwriter deliveri~g a proposal with respect to the Bcnd~ agrees thereby that if Its proposal is 2ccepted 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 November 16, 1993 BY ORDER OF THE CI1Y COUNCIL /s/ Mary Lou Johnson Clerk -111- . , e Recommendations For City of Stillwater, Minnesota $1 ,055,000 General Obligation Improvement Refunding Bonds, Series 1994A e - Study No. S078403 SPRINGSTED Incorporated November 11, 1993 , e e e SPRINGSTED 120 South Sixth Street Suite 2507 Minneapolis, MN 55402-1800 (612) 333-9177 Fax: (612) 349-5230 PUBLIC FINANCE ADVISORS Home Office 85 East Seventh Place Suite 100 Saint Paul, MN 55101-2143 (612) 223-3000 Fax: (612) 223-3002 16655 West Bluemound Road Suite 290 Brookfield, WI 53005,5935 (414) 782-8222 Fax: (414) 782-2904 6800 College Boulevard Suite 600 Overland Park, KS 66211-1533 (913) 345-8062 Fax: (913) 345-1770 November 11, 1993 Mr, Charles M. Hooley, Mayor Members, City Council Mr. Nile Kriesel, Coordinator Ms. Diane Deblon, Finance Director City of Stillwater 216 North Fourth Street Stillwater, MN 55082-4898 1800 K Street NW Suite 831 Washington, DC 20006,2200 (202) 466-3344 Fax: (202) 223-1362 Re: Recommendations for the Issuance of $1,055,000 General Obligations Improvement Refunding Bonds, Series 1994A We respectfully request your consideration of our recommendations for the issuance of the above-mentioned issue according to the attached Terms of Proposal. It is our recommendation the City refund the 1995 through 2005 maturities totaling $3,720,000 of the City's $4,850,000 General Obligation Improvement Bonds, Series 1984A, (the "Series 1984A Bonds"), dated October 1, 1984 for interest cost savings purposes. Proceeds of the 1984A Bonds were used, in addition to funds on hand, to refund the City's $6,100,000 General Obligation Temporary Improvement Bonds, Series 1981 A, dated November 1, 1981. The average net effective interest rate on the outstanding bonds is 9.86%. Based on current market conditions, it is estimated the new refunding bonds could be sold at a net effective rate of 4,58%, which, including an investment by the City of approximately $2,707,004, will result in net savings to the City estimated to be $2,162,947, for a present value savings of approximately $1,106,397. This refunding has been structured with fairly even net savings averaging approximately $196,631 annually. The proceeds of the bond issue will provide sufficient monies for the City to retire the 1995 through 2005 principal maturities on the Series 1984A Bonds, as well as pay the costs of issuance and the underwriter's discount needed for the purchaser to remarket the bonds. The 1995 through 2005 maturities of the Series 1984A Bonds will be eligible for prepayment on February 1, 1994 at a price of par plus accrued interest. As noted herein, the City will invest approximately $2,707,004 of available funds on hand in the debt service account for this issue, These funds on hand represent prepayments of assessments and those prepayments will be proportionally allocated to the entire remaining debt service requirements, This will permit the City to refinance the $3,720,000 of bonds outstanding with the issuance of $1,055,000, Appendix I, attached to these recommendations, provides a summary of the sources and uses of funds for the refunding, as well as a detailed comparison between the refunding issue proposed and the existing debt service on the Series 1984A Bonds, Schedule A shows the current debt service payments on the Series 1984A Bonds that are outstanding, On e e e City of Stillwater, Minnesota November 11, 1993 February 1, 1994, the 1995 through 2005 maturities, totaling $3,720,000, will be called for redemption as indicated in Schedule B. The City will make the principal payment due February 1, 1994 as originally scheduled on the Series 1984A Bonds, as well as the semiannual interest payment due on that date (Schedule C), Schedule D shows the estimated debt service on the new issue, The new bonds will be dated January 1, 1994 and will mature February 1 , 1996 through 2005, the same maturity length as the Series 1984A Bonds, The City will begin to pay debt service on this issue beginning on August 1, 1994. Column 6 of Schedule E shows the anticipated annual savings due to the refunding. It is our understanding debt service is to be paid from special assessments and the collection of general ad valorem taxes. The first interest due August 1, 1994 and those due through August 1, 1995 are expected to be paid from collections of special assessments originally pledged to both the 1981 A and 1984A Bonds. Thereafter, each August 1 interest payment will be made from first-half collections of special assessments and an annual tax levy, with each February 1 principal and interest payment to be made from second-half collections of special assessments and taxes, together with excess first-half collections, This payment cycle will continue for the life of the issue. The first tax levy will be made in 1994 for first collection in 1995, Since this issue is a "current refunding" in which payment of the refunded bonds is made within 90 days, the City will not have to establish an escrow account for the bond proceeds, Income earned on reinvestment of the proceeds until the call date has been included as a revenue source to help reduce the size of this issue. We have included an allowance for underwriters' discount of $10,550, or $10 per $1,000 bond, The discount provides the underwriters with all or part of their profit and/or working capital for purchasing the issue and permits them to reoffer the bonds to the investing public at a price of par, We recommend the bonds maturing on and after February 1, 2003 be subject to payment in advance of their stated maturity on February 1, 2002 and any day thereafter at a price of par plus accrued interest. This call feature, representing $360,000 or 34% of the bonds, will permit early redemption of the issue should assessment collections be received by the City sooner than currently scheduled. Interest rates change rapidly with changing market conditions. As always, the City reserves the right to cancel the bonds if interest rates received are unfavorable. We recommend an application be made to Moody's Investors Service of New York for a rating of the bonds, We will provide Moody's with the necessary data upon which they will make their rating analysis and make the application on your behalf. The rating fee will be billed directly to the City by Moody's, All tax-exempt bonds are subject to federal arbitrage regulations. The "final" arbitrage regulations were published in June, 1993. One of the requirements included rebating arbitrage profits to the U,S, Treasury, There are certain exemptions to arbitrage rebate requirements, including a small issuer exemption if the obligations are for a governmental purpose and the City reasonably expects to issue not more than $5,000,000 of tax-exempt obligations during 1994, Even if the City chooses to issue over $5 million of tax-exempt bonds during 1994, there will be no rebate required for this issue since a current refunding is exempt from rebate so long as the refunding issue is no larger than the amount refunded. A 1993 change in the federal arbitrage regulations will require special attention be paid to the accumulation and investment of monies in the debt service fund. Investments of funds which exceed a bona fide fund level will have to be restricted to the yield of the bonds. Page 2 e - e City of Stillwater, Minnesota November 11, 1993 A bona fide debt service fund is defined as a fund which is used to achieve a proper matching of revenues with principal and interest payments within each bond year and is depleted at least once each bond year except for a reasonable carryover amount which may not exceed the greater of: 1, The earnings on the fund for the preceding bond year; or 2, One-twelfth of the principal and interest payments on the issue for the immediately preceding bond year, Any earnings from a bona fide debt service fund are exempt from rebate, Amounts in a debt service fund in excess of the amount of a bona fide debt service fund are restricted to an investment rate equal to or less than the bond yield and may be invested in market rate obligations, if their yield is at or below the bond yield; in specially restricted State and Local Government Securities (SLGS) issued by the U,S, Treasury, or eligible tax-exempt obligations, A debt service fund can lose its bona fide status when the issuer accumulates too much investment earnings and/or prepaid assessments. It is important to monitor the fund to assure compliance with the new regulations, The tax reform act also restricts the ability of banks to deduct tax-exempt interest as a carrying expense under certain circumstances in calculating their tax liability. Since the City expects to issue less than $10,000,000 of tax-exempt obligations within calendar 1994, these obligations will be eligible to be designated as "qualified obligations," thereby carrying the most favorable tax-exempt interest rates. The 1993 "final" arbitrage regulations brought all tax-exempt issues into the calculation of "economic life." Previously, this requirement was only for private activity bonds. The intent of this requirement is that the U.S. Treasury does not want bonds outstanding longer than is necessary, thus creating more tax-exempt bonds in the marketplace than are needed, The general safe harbor for assuring that the bonds comply with the regulations is if the average maturity of the bonds does not exceed 120% of the economic life of the financed facilities. Since the 1984A Bonds were originally issued to finance street improvements, sanitary and storm sewer and water main improvements, which, under generally accepted accounting principles, have an economic life of at least 20 years, of which 120% equals 24 years, the City is in compliance with this regulation. The average maturity of this issue (refunding bonds) is 6.894 years, The time which has elapsed from the date of issuance of the 1981 Bonds (November 1, 1981) to the date of issuance of this issue (January 1, 1994) is 12.166 years, for a total of 19,060 years, which is within the limit. We recommend this issue be offered for sale on Tuesday, December 14, 1993, with proposals to be received in the offices of Springsted Incorporated at 11 :30 A.M., where they will be verified and checked for accuracy, The option of Sure-Bid will again be available to underwriters, as described in the Terms of Proposal attached to these recommendations, A representative of Springsted Incorporated will be present at the City Council's 7:00 P,M. meeting that evening to provide results of the refunding and recommendations as to the acceptability of the proposals received. Respectfully submitted, /~~~ ~(!Qt~4k#L SPRINGSTED Incorporated rlw Page 3 APPENDIX I City of Stillwater, Minnesota ..0. Refunding Bonds, Series 1994A Prepared: 11/08/93 By SPRINGSTED Incorporated Current Refunding Summary Partial Current Refunding of G.O, Improvement Bonds, Series 1984A Even Annual Debt Service Structure Refunding Bond Rating: A Date of Bonds: Delivery Date: Refunded Call: 1 st Callable: 01/01/94 01/11/94 02/01/94 02/01/95 Uses of Funds on: 01/11/94 Refunded Bond Call Date Sources I Uses Sources of Funds on: 02101/94 Invest. Proceeds Mature: 1 ,011,450.00 Inv, Earnings @ 2,75%: 1,545.27 Funds from Issuer: 2,707,004.73 Total Sources of Funds: 3,720,000.00 Uses of Funds on: 02101/94 Refunded Principal: 3,720,000,00 Refunded Call Premium: Excess Proceeds: Total Uses of Funds: 3,720,000.00 Refunding Delivery Date Sources I Uses Sources of Funds on: 01/11/94 Refunding Principal: Accrued Interest: uotal Sources of Funds: 1,055,000.00 1,239.02 1,056,239.02 Discount @ $10.00 Acc, Int. & Unused Disc: Refunding Expenses: Investment to Call Date: Total Uses of Funds: 10.550,00 1,239,02 33,000.00 1,011,450.00 1,056,239.02 Refunded / Refunding Bond Comparison As of: Refunded Refunding 01/01/94 Statistics Statistics Principal: 3,720,000 1,055,000 Interest: 2.556,135 322,227 Bond Yrs: 25,920 7,273 Avg. Mat: 6.968 6.894 IC: 9.86% 4.58% Total Net Savings/Present Value Savings Future Savings: 4,868,712.92 Less Funds From Issuer: 2,707,004.73 Plus Accr. Int. to D/S Fund: 1,239.02 Plus Exc, Proc. to D/S Fund: Total Net Savings: 2,162.947,21 Present Value Sav@ 4,41%: 1,106.397.89 As % of P.V, Refunded Int.: 52.82% Page 4 , SCHEDULE A City of Stillwater, Minnesota ~,O, Improvement Bonds, Series 1984A ~isting Debt Service Prepared: 11/08/93 By SPRINGSTED Incorporated Date Principal Rate Interest Semi-Annual Annual 02/01/94 190,000.00 8,900% 189,626,25 379,626,25 379,626.25 08/01/94 181,171.25 181,171.25 02/01/95 205,000,00 9,100% 181,171.25 386,171.25 567,342,50 08/01/95 171,843,75 171,843,75 02/01/96 225,000.00 9,250% 171,843,75 396,843,75 568,687,50 08/01/96 161,437.50 161,437,50 02/01/97 250,000,00 9,400% 161,437.50 411,437,50 572,875,00 08/01/97 149,687.50 149,687,50 02/01/98 270,000,00 9.500% 149,687,50 419,687,50 569,375,00 08/01/98 136,862,50 136,862,50 02/01/99 300,000,00 9,600% 136,862,50 436,862,50 573,725.00 08/01/99 122,462,50 122,462,50 02/01/2000 325,000,00 9,700% 122,462.50 447,462,50 569,925,00 08/01/2000 106,700.00 106,700,00 02/01/2001 355,000,00 9,800% 106,700.00 461,700,00 568,400,00 08/01/2001 89,305,00 8.9,305,00 02/01/2002 390,000,00 9.900% 89,305,00 479,305,00 568,610,00 08/01/2002 70,000,00 70,000.00 <</01/2003 430,000,00 10,000% 70,000,00 500,000,00 570,000,00 /01/2003 48,500,00 48,500,00 02/01/2004 470,000,00 10,000% 48,500,00 518,500,00 567,000,00 08/01/2004 25,000.00 25,000,00 02/01/2005 500,000.00 10.000% 25,000,00 525,000,00 550,000,00 Totals "ond Years: Avg, Mat,,: NIC...,.,. : 3,910,000,00 2,715,566,25 6,625,566,25 6,625,566,25 25,935,83 6.633 9.861% All lower calculations are made from the date of the refunding bonds Refunded Bonds Only A vg. Ma t. , : 6 , 968 NIC. , , , , , , : 9.862 Page 5 , City of Stillwater, Minnesota ~O. Improvement Bonds, Series 1984A ~funded Principal and any Call Premium Date Principal 02/01/94 3,720,000.00 e ~::l:ate....~:~~~:~~~:oo First Date Called~....: Call Premium..........: Premium 02/01/94 02/01/95 SCHEDULE 8 Prepared: 11/08/93 By SPRINGSTED Incorporated Semi-Annual Annual 3,720,000.00 3,720,000.00 3,720,000.00 3,720,000.00 This portion will be paid with proceeds. Page 6 l SCHEDULE C City of Stillwater, Minnesota ~.O. Improvement Bonds, Series 1984A ~n-Refunded Debt Service Prepared: 11/08/93 By SPRINGSTED Incorporated Date Principal Rate Interest Semi-Annual Annual 02/01/94 190,000.00 8.900% 189,626.25 379,626.25 379,626.25 e tiotals This portion Will' be paid by the issuer. The first payment includes interest on the entire existing debt service. 190,000.00 189,626.25 379,626.25 379,626.25 Page 7 SCHEDULE D 1 City of Stillwater, Minnesota G.O. Refunding Bonds, Series 1994A ~funding Debt Service Prepared: 11/08/93 By SPRINGSTED Incorporated Date Principal Rate Interest Semi-Annual Annual 08/01/94 26,019.58 26,019.58 02/01/95 22,302.50 22,302.50 48,322.08 08/01/95 22,302.50 22,302.50 02/01/96 90,000.00 3.350% 22,302.50 112,302.50 134,605.00 08/01/96 20,795.00 20,795.00 02/01/97 90,000.00 3.550% 20,795.00 110,795.00 131,590.00 08/01/97 19,197.50 19,197.50 02/01/98 95,000.00 3.750% 19,197.50 114,197.50 133,395.00 08/01/98 17,416.25 17,416.25 02/01/99 100',000.00 3.950% 17,416.25 117,416.25 134,832.50 08/01/99 15,441. 25 15,441. 25 02/01/2000 105,000.00 4.150% 15,441. 25 120,441.25 135,882.50 08/01/2000 13,262.50 13,262.50 02/01/2001 105,000.00 4.300% 13,262.50 118,262.50 131,525.00 08/01/2001 11,005.00 11,005.00 02/01/2002 110,000.00 4.450% 11,005.00 121,005.00 132,010.00 08/01/2002 8,557.50 8,557.50 ./01/2003 115,000.00 4.600% 8,557.50 123,557.50 132,115.00 /01/2003 5,912.50 5,912.50 02/01/2004 120,000.00 4.750% 5,912.50 125,912.50 131,825.00 08/01/2004 3,062.50 3,062.50 02/01/2005 125,000.00 4.900% 3,062.50 128,062.50 131,125.00 Totals e,nd Date.: Avg. Mat..: NIC....... : 1,055,000.00 322,227.08 1,377,227.08 1,377,227.08 01/01/94 6.894 4.576% Delivery. . : Discount.%: Bond Yield: 01/11/94 1.00000% 4.40846% Page 8 t City of Stillwater, Minnesota .0. Refunding Bonds, Series 1994A nual Savings Analysis Date (1 ) 02/01/94 08/01/94 02/01/95 08/01/95 02/01/96 08/01/96 02/01/97 08/01/97 02/01/98 08/01/98 02/01/99 08/01/99 02/01/2000 08/01/2000 02/01/2001 08/01/2001 02/01/2002 08/01/2002 ./01/2003 /01/2003 02/01/2004 08/01/2004 02/01/2005 .tals Present Present As % of Refunding Non-Refunded Debt Service Debt Service (2) (3) 48,322.08 134,605.00 131,590.00 133,395.00 134,832.50 135,882.50 131,525.00 132,010.00 132,115.00 131,825.00 131,125.00 1,377,227.08 Value Rate...: Value Savings: P.V. Ref. Int: 379,626.25 379,626.25 4.4085% 1,106,397.89 52.82% Total New Debt Service (4 ) 379,626.25 48,322.08 134,605.00 131,590.00 133,395.00 134,832.50 135,882.50 131,525.00 132,010.00 132,115.00 131,825.00 131,125.00 SCHEDULE E Prepared: 11/08/93 By SPRINGSTED Incorporated Existing Debt Service (5 ) 379,626.25 567,342.50 568,687.50 572,875.00 569,375.00 573,725.00 569,925.00 568,400.00 568,610.00 570,000.00 567,000.00 550,000.00 Savings or (Loss) (6 ) 519,020.42 434,082.50 441,285.00 435,980.00 438,892.50 434,042.50 436,875.00 436,600.00 437,885.00 435,175.00 418,875.00 1,756,853.33 6,625,566.25 4,868,712.92 Funds from Issuer....: (2,707,004.73) Acc. Int. to D/S Fund: 1,239.02 Total Net Savings....: 2,162,947.21 Page 9 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 ,055,000 CITY OF STILLWATER, MINNESOTA GENERAL OBUGATION IMPROVEMENT REFUNDING BONDS, SERIES 1994A Proposals for the Bonds will be received on Tuesday, December 14, 1993, until 11 :30 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 7:00 P.M., Central Time, of the same day. DETAILS OF THE BONDS The Bonds will be dated January 1, 1994, as the date of original issue, and will bear interest payable on February 1 and August 1 of each year, commencing August 1, 1994. Interest will be computed on the basis of a 360-day year of twelve 30-day months. The Bonds will be issued in the denomination of $5,000 each, or in integral multiples thereof, as requested by the purchaser, and fully registered as to principal and interest. Principal will be payable at the main corporate office of the registrar and interest on each Bond will be payable by check or draft of the registrar mailed to the registered holder thereof at the holder's address as it appears on the books of the registrar as of the close of business on the 15th day of the immediately preceding month. The Bonds will mature February 1 in the years and amounts as follows: 1996 $ 90,000 1997 $ 90,000 1998 $ 95,000 1999 $100,000 2000 $105,000 2001 $105,000 2002 $110,000 2003 $115,000 2004 $120,000 2005 $125,000 OPTIONAL REDEMPTION The City may elect on February 1, 2002, and on any day thereafter, to prepay Bonds due on or after February 1, 2003. Redemption may be in whole or in part and if in part, at the option of the City and in such order as the City shall determine and within a maturity by lot as selected by the registrar. 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 specail assessments against benefited property. The proceeds will be used to refund the 1995 through 2005 maturities of the City's $4,850,000 General Obligation Improvement Bonds, Series 1984A, dated October 1, 1984. TYPE OF PROPOSALS Proposals shall be for not less than $1,044,450 and accrued interest on the total principal amount of the Bonds. Proposals shall be accompanied by a Good Faith Deposit ("Deposit") in Page 10 Page 11 ~ e e e 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 Dorsey & Whitney of Minneapolis, Minnesota, which opinion will be printed on the Bonds, 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. 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 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 St,atement. Dated November 16, 1993 BY ORDER OF THE CITY COUNCIL /s/ Mary Lou Johnson Clerk Page 12