HomeMy WebLinkAbout17- Bond Purchase Agreement - Tax Increment Urban Renewal Revenue Bond (NEURD), Series 2017BOND PURCHASE AGREEMENT
May 12, 2017
City of Bozeman
121 N. Rouse
Bozeman, MT 59771
Attention: Dennis Taylor, Interim City Manager
Anna Rosenberry, Assistant City Manager
Big Sky Western Bank
P.O. Box 667
Bozeman, MT 59771-0667
Attention: James J. Ness, President
Tax Increment Urban Renewal Revenue Bond
(Northeast Urban Renewal District), Series 2017
City of Bozeman, Montana
Ladies and Gentlemen:
The undersigned, Big Sky Western Bank, as purchaser (the "Purchaser"), hereby offers to enter
into this Bond Purchase Agreement (this "Agreement') with the City of Bozeman, Montana (the
"City"), for the sale by the City and purchase by the Purchaser of the above -referenced bond (the
"Bond"). This offer is made subject to the written acceptance hereof by the City and delivery of
such acceptance to the Purchaser (in the form of one or more executed counterparts hereof) at or
prior to 5:00 P.M., Bozeman, Montana time, on May 12, 2017. Upon such acceptance, this
Agreement will be in full force and effect in accordance with its terms and will be binding upon
the City and the Purchaser.
The Bond is being issued pursuant to a resolution (the "Bond Resolution") to be adopted by the
City on or about May 22, 2017, authorizing and fixing the terms and conditions of the Bond.
Capitalized terms not otherwise defined herein shall have the meanings given them in the Bond
Resolution.
1. Upon the terms and conditions and based on the representations, warranties and
covenants hereinafter set forth, the Purchaser hereby agrees to purchase from the City and the
City hereby agrees to sell to the Purchaser, all (but not less than all) of the Bond upon the terms
set forth in the Bond Resolution, including the following terms:
Principal Amount:
$1,446,000
Closing Date:
The date on which the first advance of the Bond is made to the City by the
Purchaser, which is expected to be on or about July 20, 2017
Term:
Approximately 25 -year term (50 semi-annual payments), absent earlier
prepayment or redemption. Semiannual installment payments commence
January 1, 2018 and conclude July 1, 2042, absent earlier prepayment or
redemption.
Interest Rate:
4.10% per annum, fixed for the entire term.
Draw -Down Bond:
The principal amount of the Bond will be advanced in two advances, with
the first advance of principal in the amount of $863,000 to be made on the
Closing Date to pay a portion of the costs of the East Peach Street Project,
and the second advance of principal in the principal amount of $583,000 to
be made on July 20, 2018, which is expected to pay a portion of the costs
of the East Tamarack Street Project, but may pay a portion of the costs of
the Other Priority Street Projects.
Amortization
Substantially as attached hereto as Exhibit A.
Schedule of Draw -
Down Bond:
Fees and Expenses:
The Purchaser will charge the City an origination fee equal to $11,951.50,
which is based on the amount of the second advance noted above
($583,000 multiplied by 4.10% with the product divided by 2). The City
will pay reasonable fees and expenses of bond counsel. Such amounts will
be paid from proceeds of the Bond or other amounts available to the City.
Redemption Terms:
The Bond is subject to redemption and prepayment without premium or
penalty in whole or in part at the option of the City on 30 days' prior
written notice. The City's notice of redemption and prepayment shall
specify the redemption date, redemption price, and the place at which the
Bond is to be surrendered for payment if redeemed and prepaid in full,
and, if redeemed and prepaid in part, the total principal amount of the
Bond to be redeemed and prepaid in part and the principal amounts on
each semiannual payment date that comprise the total partial prepayment
2. The Bond will be a special, limited obligation of the City, payable solely from and
secured by Tax Increment received from the Northeast Urban Renewal District and amounts on
hand in the debt service reserve account related to the Bond, as described in the Bond
Resolution.
3. This Agreement will be governed by and construed in accordance with the laws of
the State of Montana.
4. This Agreement may be executed in multiple counterparts, each of which will be
deemed an original but all of which together will constitute but one and the same instrument.
This Agreement may be delivered by the exchange of signed signature pages by facsimile
transmission or by e-mail with a pdf copy or other replicating image attached, and any printed or
copied version of any signature pages so delivered shall have the same force and effect as an
originally signed version of such signature page.
and redemption amount.
As described in greater detail in the Bond Resolution, if the Bond is
prepaid in part, the Purchaser will reamortize the principal remaining upon
redemption and prepayment as a result of and in accordance with the
prepayment notice of the City at the interest rate over the then -remaining
term.
Bank Qualification:
The City will designate the Bond as a "qualified tax-exempt obligation"
within the meaning of Section 265(b)(3) of the Internal Revenue Code of
1986, as amended.
2. The Bond will be a special, limited obligation of the City, payable solely from and
secured by Tax Increment received from the Northeast Urban Renewal District and amounts on
hand in the debt service reserve account related to the Bond, as described in the Bond
Resolution.
3. This Agreement will be governed by and construed in accordance with the laws of
the State of Montana.
4. This Agreement may be executed in multiple counterparts, each of which will be
deemed an original but all of which together will constitute but one and the same instrument.
This Agreement may be delivered by the exchange of signed signature pages by facsimile
transmission or by e-mail with a pdf copy or other replicating image attached, and any printed or
copied version of any signature pages so delivered shall have the same force and effect as an
originally signed version of such signature page.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed
as of the date first above written.
CITY OF BOZEMAN, MONTANA
By
Name: bennis Taylor
Title: Interim City Manager
By -
Name: na Ros erry
Title: Assistant City Manager
BIG SKY WESTERN BANK
4
EXHIBIT A
AMORTIZATION SCHEDULE
4.10%
Date
ADVANCES
Interest
Principal
Total Payment Balance
07/20/17
863,000.00
863,000.00
01/01/18
1
15,995.05
30,004.95
46,000.00 832,995.05
07/01/18
2
16,936.04
29,063.96
46,000.00 803,931.09
07/20/18
583,000.00
1,386,931.09
01/01/19
3
27,421.51
18,578.49
46,000.00 1,368,352.60
07/01/19
4
27,820.67
18,179.33
46,000.00 1,350,173.27
01/01/20
5
27,906.05
18,093.95
46,000.00 1,332,079.32
07/01/20
6
27,158.40
18,841.60
46,000.00 1,313,237.72
01/01/21
7
27,068.48
18,931.52
46,000.00 1,294,306.20
07/01/21
8
26,315.20
19,684.80
46,000.00 1,274,621.40
01/01/22
9
26,344.50
19,655.50
46,000.00 1,254,965.90
07/01/22
10
25,515.35
20,484.65
46,000.00 1,234,481.25
01/01/23
11
25,514.87
20,485.13
46,000.00 1,213,996.12
07/01/23
12
24,682.37
21,317.63
46,000.00 1,192,678.49
01/01/24
13
24,650.87
21,349.13
46,000.00 1,171,329.36
07/01/24
14
23,881.04
22,118.96
46,000.00 1,149,210.40
01/01/25
15
23,687.55
22,312.45
46,000.00 1,126,897.95
07/01/25
16
22,911.53
23,088.47
46,000.00 1,103,809.48
01/01/26
17
22,814.08
23,185.92
46,000.00 1,080,623.56
07/01/26
18
21,970.71
24,029.29
46,000.00 1,056,594.27
01/01/27
19
21,838.21
24,161.79
46,000.00 1,032,432.48
07/01/27
20
20,990.91
25,009.09
46,000.00 1,007,423.39
01/01/28
21
20,821.92
25,178.08
46,000.00 982,245.31
07/01/28
22
20,026.00
25,974.00
46,000.00 956,271.31
01/01/29
23
19,710.69
26,289.31
46,000.00 929,982.00
07/01/29
24
18,907.94
27,092.06
46,000.00 902,889.94
01/01/30
25
18,661.37
27,338.63
46,000.00 875,551.31
07/01/30
26
17,801.28
28,198.72
46,000.00 847,352.59
01/01/31
27
17,513.50
28,486.50
46,000.00 818,866.09
07/01/31
28
16,648.78
29,351.22
46,000.00 789,514.87
01/01/32
29
16,318.08
29,681.92
46,000.00 759,832.95
07/01/32
30
15,491.46
30,508.54
46,000.00 729,324.41
01/01/33
31
15,032.85
30,967.15
46,000.00 698,357.26
07/01/33
32
14,198.66
31,801.34
46,000.00 666,555.92
01/01/34
33
13,776.71
32,223.29
46,000.00 634,332.63
07/01/34
34
12,896.94
33,103.06
46,000.00 601,229.57
01/01/35
35
12,426.51
33,573.49
46,000.00 567,656.08
07/01/35
36
11,541.30
34,458.70
46,000.00 533,197.38
01/01/36
37
11,020.39
34,979.61
46,000.00 498,217.77
07/01/36
38
10,157.65
35,842.35
46,000.00 462,375.42
01/01/37
39
9,530.49
36,469.51
46,000.00 425,905.91
07/01/37
40
8,659.31
37,340.691
46,000.00 388,565.22
01/01/38
41
8,031.06
37,968.94
46,000.00 350,596.28
07/01/38
42
7,128.15
38,871.85
46,000.00 311,724.43
01/01/39
43
6,442.87
39,557.13
46,000.00 272,167.30
07/01/39
44
5,533.57
40,466.43
46,000.00 231,700.87
01/01/40
45
4,788.91
41,211.09
46,000.00 190,489.78
07/01/40
46
3,883.70
42,116.30
46,000.00 148,373.48
01/01/41
47
3,058.28
42,941.72
46,000.00 105,431.76
07/01/41
48
2,143.59
43,856.41
46,000.00 61,575.35
01/01/42
49
1,272.67
44,727.33
46,000.00 16,848.02
07/01/42
50
342.55
16,848.02
17,190.57 0.00
TOTALS
1,446,000.00
825,190.57 1,446,000.00
2,271,190.57
A-1