HomeMy WebLinkAboutResolution 3408 $2,630,000 pooled SID bonds, series 2000 (Valley West)
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RESOLUTION NO. 3408
RESOLUTION RELATING TO $2,630,000 POOLED SPECIAL
IMPROVEMENT DISTRICT BONDS, SERIES 2000 (SPECIAL
IMPROVEMENT DISTRICT NOS. 666, 667 AND 668); FIXING THE FORM
AND DETAILS AND PROVIDING FOR THE EXECUTION AND DELIVERY
THEREOF AND SECURITY THEREFOR
BE IT RESOLVED by the City Commission (the "Commission") of the City of
Bozeman, Montana (the "City"), as follows:
Section 1. Recitals. It is hereby found, determined and declared as follows:
1.01. Resolutions of Intention. By Resolution Nos. 3380, 3381 and 3382, all
adopted August 7, 2000 (collectively, the "Resolutions of Intention"), this Commission declared
its intention to create Special Improvement District No. 666 ("SID No. 666"), Special
Improvement District No. 667 ("SID No. 667") and Special Improvement District No. 668 ("SID
No. 668"), respectively (collectively, the "Districts"), for the purpose of acquiring certain special
improvements for the special benefit of the Districts. Each of the Resolutions of Intention
designated the number of the District, described the boundaries thereof, stated whether the
District was an extended district and stated the general character of the improvements to be
purchased (collectively, the "Improvements") and an approximate estimate of the costs thereof,
in accordance with the provisions of Montana Code Annotated, Title 7, Chapter 12, Parts 41 and
42, as amended (the "Act"). By each Resolution of Intention this Commission also declared its
intention to cause the cost and expense of acquiring the Improvements specially benefiting a
District to be assessed against the properties included within the boundaries thereof in
accordance with one or more methods of assessment authorized in Montana Code Annotated,
Sections 7-12-4161 to 7-12-4165 and as set forth in the Resolution of Intention.
In the Resolutions of Intention, this Commission further found that it is in the
public interest, and in the best interest of the City and the Districts, to secure payment of
principal of and interest on the Bonds by the Special Improvement District Revolving Fund of
the City, on the basis of factors required to be considered under Section 7-12-4225 of the Act.
Those findings are hereby ratified and confirmed.
1.02. Notices. Notices of the passage of each of the Resolutions of Intention
were given by two publications, with at least six days between publications, the first no more
than 21 days prior to the hearing and the last no less than three days prior to the hearing, in the
Bozeman Daily Chronicle, a daily newspaper published within the City, as required by Montana
Code Annotated, Sections 7-12-4106(2) and 7-1-2121. Notices ofthe passage of each of the
Resolutions of Intention were also mailed the same day the notice was first published to all
persons, firms or corporations or the agents thereof having real property within each District,
listed in their names upon the last completed assessment roll for state, county and school district
taxes, at their last known addresses. The notices for each District described the general character
of the Improvements made therein or therefor, stated the estimated cost of such Improvements
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and the method or methods of assessment of such costs against properties in the District,
specified the time when and the place where the Commission would hear and pass upon all
protests made against the acquiring of such improvements or the creation or extension of such
District, and referred to the appropriate Resolutions of Intention as being on file in the office of
the Clerk of the Commission for a description of the boundaries of the District, all in accordance
with the provisions of each Resolution of Intention, and included a statement that, subject to the
limitations of Section 7-12-4222 of the Act, the general tax levy may be imposed on all taxable
property in the City to meet the financial requirements of the revolving fund.
1.03. Creation of Districts. At the times and places specified in the notices
hereinabove described, this Commission met to hear, consider and pass upon all protests made
against the acquiring of the hnprovements and the creation of each of the Districts, and, after
consideration thereof, it was determined and declared that insufficient protests against the
creation or extension of each of the Districts or the work had been filed in the time and manner
provided by law by the owners of the property to be assessed for the hnprovements in the
respective Districts, and this Commission did therefore by Resolution Nos. 3391, 3392 and 3393,
all adopted September 11, 2000, create the Districts and order the acquiring of the hnprovements
in each District in accordance with the Resolutions of Intention. In the resolutions, the
Commission also declared its intention to reimburse the City for costs paid before issuance of the
Bonds, as required by Section 1.150-2 of the Income Tax Regulations promulgated under the
Internal Revenue Code, and confirmed the findings it made with respect to the pledge of the
Revolving Fund in the Resolutions of Intention.
1.04. Acauisition of hnurovements. The hnprovements, including paving, gravel
base courses and subgrade preparation, curb, gutter and storm drainage, and installation and
construction of a water main and appurtenances thereto and sanitary sewer mains and
appurtenances thereto, which are being acquired for the benefit of the Districts were constructed
and installed by Valley West L.L.C. (the "Developer"). Upon review of the plans and
specifications pursuant to which the hnprovements were constructed and a review of the costs
thereof, the City's engineers determined acquisition prices for the Improvements in each of the
special improvement districts to be as follows:
SID No. 666 $1,187,175.15
SID No. 667 503,518.50
SID No. 668 634,862.38
The Developer and the City have agreed that the purchase prices are fair, just and reasonable.
The Commission hereby confirms and approves the acquisition prices of the hnprovements.
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1.05. Costs. It is currently estimated that the costs and expenses connected with
and incidental to the formation of the Districts to the City to be assessed against properties in the
District, including the acquisition costs of the hnprovements and all other costs and expenses,
including the deposit of proceeds in the Revolving Fund of $66,750 for SID No. 666, $28,750 for
SID No. 667 and $36,000 for SID No. 668 and in the District Reserve Subaccount in the
respective District Account of $6,048.85 for SID No. 666, $8,595.50 for SID No. 667 and
$7,199.62 for SID No. 668, for a total of $2,630,000. Such amounts will be levied and assessed
upon the assessable property within each of the Districts on the basis described in the
Resolutions of Intention. This Commission has jurisdiction and is required by law to levy and
assess such amounts, to collect such special assessments and credit the same to the special
improvement district accounts created for each District, which accounts are to be maintained on
the official books and records of the City separate from all other City funds, within the 2000
Pooled Special hnprovement District Sinking Fund (the "Sinking Fund") for the payment of
principal and interest when due on the bonds herein authorized.
1.06. Sale and Issuance of Bonds. For the purpose of financing the costs and
expenses of acquiring the hnprovements, which are to be assessed against the property within
each District as provided in the Resolutions of Intention, pursuant to Resolution No. 3394,
adopted September 11, 2000, this Commission determined that the issuance and sale of bonds in
a pooled single offering was in the best interests of the City and the Districts and would facilitate
the sale of the bonds at lower interest rates. This Commission then called for the public sale of
bonds in the total aggregate amount of $2,630,000 (the "Bonds"), which amount represents
Bonds for each District as follows:
District No. Principal Amount
666 $1,335,000
667 $575,000
668 $720,000
Advertisements for bids for the purchase of the Bonds were published in accordance with the
provisions of Montana Code Annotated, Sections 7-12-4204, 7-7-4252 and 17-5-106. Pursuant
to the October 2, 2000 minutes of the Commission, this Commission authorized the City to enter
into a contract with D.A. Davidson & Co., of Great Falls, Montana (the "Purchaser"), as the
lowest responsible bidder pursuant to which the Purchaser agreed to purchase from the City the
Bonds at a purchase price of $2,590,550, plus interest accrued thereon from the date of original
issue of the Bonds, at the rates of interest set forth in Section 2.01 hereof and upon the further
terms set forth in this resolution resulting in a total interest cost of 5.4912% per annum and at a
total dollar interest cost of $1,408,186.50.
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1.07. Recitals. All acts, conditions and things required by the Constitution and
laws of the State of Montana, including Montana Code Annotated, Title 7, Chapter 12, Parts 41
and 42, as amended, in order to make the Bonds valid and binding special obligations in
accordance with their terms and in accordance with the terms of this resolution have been done,
do exist, have happened and have been performed in regular and due form, time and manner as
so required.
Section 2. The Bonds.
2.01. Principal Amount. Maturities. Denominations. Date. Interest Rates. For the
purpose of paying the costs and expenses incurred in acquiring the Improvements, and in
anticipation of the collection of special assessments to be levied therefor, and in accordance with
the proposal described in Section 1.06, the City shall forthwith issue and deliver to the Purchaser
the Bonds payable solely from the Sinking Fund and denominated "Pooled Special Improvement
District Bonds, Series 2000 (Special Improvement District Nos. 666, 667 and 668)." The Bonds
shall be dated, as originally issued, and be registered as of October 15,2000, shall each be in the
denomination of $5,000 or any integral multiple thereof of single maturities, shall mature on July
1 in the years and principal amounts set forth below, and Bonds maturing in such years and
principal amounts shall bear interest from the date of original registration until paid or duly
called for redemption at the rates per annum set forth opposite such years and amounts,
respecti vel y:
Principal Principal
Year Amount Rate Year Amount
Rate
2001 $135,000 4.40% 2011 $140,000
5.10%
2002 135,000 4.50 2012 140,000
5.20
2003 135,000 4.55 2013 140,000
5.30
2004 135,000 4.60 2014 140,000
5.40
2005 135,000 4.70 2015 140,000
5.50
2006 135,000 4.75 2016 140,000
5.60
2007 140,000 4.80 2017 140,000
5.70
2008 140,000 4.85 2018 140,000
5.75
2009 140,000 4.90 2019 140,000
5.75
2010 140,000 5.00
2.02. Interest Payment Dates. Interest on the Bonds shall be payable on each
January 1 and July 1, commencing January 1,2001, to the owners of record thereof as such
appear on the bond registrar at the close of business on the fifteenth day of the immediately
preceding month, whether or not such day is a business day. Upon the original delivery of the
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Bonds to the Purchaser and upon each subsequent transfer or exchange of a Bond pursuant to
Section 2.04, the Registrar shall date each Bond as of the date of its authentication.
2.03. Method of Pavment. The Bonds shall be issued only in fully registered
form. The interest on and, upon surrender thereof at the principal office of the Registrar (as
hereinafter defined), the principal of each Bond, shall be payable by check or draft drawn on the
Registrar.
2.04. Registration. The City hereby appoints the Administrative Services
Director of the City, to act as registrar, transfer agent and paying agent (the "Registrar"). The
City reserves the right to appoint a bank, trust company or financial institution as successor bond
registrar, transfer agent or paying agent, as authorized by the Model Public Obligations
Registration Act of Montana, Montana Code Annotated, Title 17, Chapter 5, Part 11, as amended
(the "Registration Act"), but the City agrees to pay the reasonable and customary charges of the
Registrar for the services performed. This Section 2.04 shall establish a system of registration
for the Bonds as defined in the Registration Act.
The effect of registration and the rights and duties of the City and the Registrar
with respect thereto shall be as follows:
(a) Bond Register. The Registrar shall keep at its principal office a bond register
in which the Registrar shall provide for the registration of ownership of the Bonds and the
registration of transfers and exchanges of the Bonds entitled to be registered, transferred
or exchanged.
(b) Transfer. Upon surrender to the Registrar for transfer of any Bond duly
endorsed by the registered owner thereof or accompanied by a written instrument of
transfer, in form satisfactory to the Registrar, duly executed by the registered owner
thereof or by an attorney duly authorized by the registered owner in writing, the Registrar
shall authenticate and deliver, in the name of the designated transferee or transferees, one
or more new Bonds of a like aggregate principal amount and maturity, as requested by the
transferor. The Registrar may, however, close the books for registration of any transfer of
any Bond or portion thereof selected or called for redemption. No transfer or exchange of
a Bond shall affect its order of registration for purposes of redemption pursuant to Section
2.05.
(c) Exchan!!e. Whenever any Bond is surrendered by the registered owner for
exchange, the Registrar shall authenticate and deliver one or more new Bonds of a like
aggregate principal amount, interest rate and maturity, as requested by the registered
owner or the owner's attorney duly authorized in writing.
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(d) Cancellation. All Bonds surrendered upon any transfer or exchange shall be
promptly canceled by the Registrar and thereafter disposed of as directed by the City.
(e) ImDroDer or Unauthorized Transfer. When any Bond is presented to the
Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that
the endorsement on such Bond or separate instrument of transfer is valid and genuine and
that the requested transfer is legally authorized. The Registrar shall incur no liability for
the refusal, in good faith, to make transfers which it, in its judgment, deems improper or
unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in
whose name any Bond is at any time registered in the bond register as the absolute owner
of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving
payment of, or on account of, the principal of and interest on such Bond and for all other
purposes, and all such payments so made to any such registered owner or upon the
owner's order shall be valid and effectual to satisfy and discharge the liability of the City
upon such Bond to the extent of the sum or sums so paid.
(g) Taxes. Fees and Charges. For every transfer of Bonds or exchange of Bonds
(except an exchange upon a partial redemption of a Bond), the Registrar may impose a
charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee or
other governmental charge required to be paid with respect to such transfer or exchange.
(h) Mutilated. Lost. Stolen or Destroved Bonds. In case any Bond shall become
mutilated or be destroyed, stolen or lost, the Registrar shall deliver a new Bond of like
amount, number, maturity date and tenor in exchange and substitution for and upon
cancellation of any such mutilated Bond or in lieu of and in substitution for any such
Bond destroyed, stolen or lost, upon the payment of the reasonable expenses and charges
of the Registrar in connection therewith; and, in the case of a Bond destroyed, stolen or
lost, upon filing with the Registrar of evidence satisfactory to it that such Bond was
destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the
Registrar an appropriate bond or indemnity in form, substance and amount satisfactory to
it, in which both the City and the Registrar shall be named as obligees. All Bonds so
surrendered to the Registrar shall be canceled by it and evidence of such cancellation
shall be given to the City. If the mutilated, destroyed, stolen or lost Bond has already
matured or such Bond has been called for redemption in accordance with its terms, it
shall not be necessary to issue a new Bond prior to payment.
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2.05. Redemption.
(a) Mandatory Redem\Jtion. If on any interest payment date there will be a
balance in the Sinking Fund after payment of the principal and interest due on all Bonds drawn
against it, either from the prepayment of special assessments levied in the Districts or from the
transfer of surplus money from the Acquisition Subaccount to the Principal Subaccount as
provided in Section 3.02 or otherwise, the Administrative Services Director shall call for
redemption on the interest payment date outstanding Bonds, or portions thereof, in an amount
which, together with the interest thereon to the interest payment date, will equal the amount of
such funds on deposit in the Sinking Fund on that date. The redemption price shall equal the
amount of the principal amount of the Bonds to be redeemed plus interest accrued to the date of
redemption.
(b) ODtional RedemDtion. The Bonds are subject to redemption, in whole or in
part, at the option of the City from sources of funds available therefor other than those described
in Subsection (a) of this Section 2.05 on any interest payment date; provided, however, the Bonds
shall not be called for redemption (i) from amounts on deposit in the District Reserve
Subaccounts in the District Accounts or (ii) before July 1,2005, from the proceeds of refunding
special improvement district bonds or warrants. The redemption price shall equal the principal
amount of the Bonds to be redeemed plus interest accrued to the date of redemption.
(c) Selection of Bonds for Redemption: Partial Redemption. If less than all of the
Bonds are to be redeemed, Bonds shall be redeemed in order of the stated maturities thereof. If
less than all Bonds of a stated maturity are to be redeemed, the Bonds of such maturity shall be
selected for redemption in $5,000 principal amounts selected by the Registrar by lot or other
manner it deems fair. Upon partial redemption of a Bond, a new Bond or Bonds will be
delivered to the registered owner without charge, representing the remaining principal amount
thereof outstanding.
(d) Notice and Effect of Redemption. The date of redemption shall be fixed by
the Administrative Services Director, who shall give notice, by first class mail, postage prepaid
to the owner or owners of such Bonds at their addresses appearing in the bond register, of the
numbers of the Bonds or portions thereof to be redeemed and the date on which payment will be
made, which date shall be not less than thirty (30) days after the date of mailing notice. On the
date so fixed interest on the Bonds or portions thereof so redeemed shall cease.
2.06. Fonn. The Bonds shall be drawn in substantially the fonn set forth in
Exhibit A hereto, and by this reference made a part hereof, with such modifications as are
permitted by the Act.
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2.07. Execution. Registration and Delivery. The Bonds shall be prepared under
the direction of the Administrative Services Director and shall be executed on behalf of the City
by the signatures of the Mayor, the City Manager and the Clerk of the Commission and sealed
with the official seal of the City; provided that the signatures and the corporate seal may be
printed, engraved or lithographed facsimiles of the originals. In case any officer whose signature
or a facsimile of whose signature shall appear on the Bonds shall cease to be such officer before
the delivery of any Bond, such signature or facsimile shall nevertheless be valid and sufficient for
aH purposes, the same as if such officer had remained in office until delivery. Notwithstanding
such execution, no Bond shall be valid or obligatory for any purpose or entitled to any security or
benefit under this resolution unless a certificate of authentication on such Bond has been duly
executed by the manual signature of an authorized representative of the Registrar. Certificates of
authentication on different Bonds need not be signed by the same representative. The executed
certificate of authentication on each Bond shall be conclusive evidence that it has been
authenticated and delivered under this resolution. The Bonds shall be registered in order of their
serial numbers by the Registrar, as attested by the Certificate of Authentication, as of October 15,
2000. When the Bonds have been so executed, authenticated and registered, they shall be
delivered by the Registrar to the Purchaser upon payment of the purchase price in accordance
with the contract of sale heretofore made and executed. The Purchaser shaH not be obligated to
see to the application of the purchase price, but from the proceeds of the Bonds the
Administrative Services Director shaH credit forthwith $66,750 for SID No. 666, $28,750 for
SID No. 667 and $36,000 for SID No. 668 to the Revolving Fund, as required by Section 7-12-
4169(2) of the Act; $6,048.85 for SID No. 666, $8,595.50 for SID No. 667 and $7,199.62 for
SID No. 668 to the District Reserve Subaccount in the respective District Account; any accrued
interest to the Interest Subaccounts in the Sinking Fund, as provided in Section 3.03; and the
balance of such proceeds to the Acquisition Subaccounts in the respective District Accounts, in
proportion to the principal amounts of the Bonds aHocable to each of the Districts, as set forth in
Section 1.06, to be used solely for the purposes described in Section 3.02.
2.08. Securities Depository for Series 2000 Bonds.
(a) For purposes of this Section 2.08, the following tenns shall have the foHowing
meanings:
"Beneficial Owner" shaH mean, whenever used with respect to a Bond, the person
in whose name such Bond is recorded as the beneficial owner of such Bond by a
Participant on the records of such Participant, or such person's subrogee.
"Cede & Co." shaH mean Cede & Co., the nominee of DTC, and any successor
nominee of DTC with respect to the Bonds.
"DTC" shall mean The Depository Trust Company of New York, New York.
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"Participant" shall mean any broker-dealer, bank or other financial institution for
which DTC holds Bonds as securities depository.
"Representation Letter" means the Blanket Issuer Letter of Representations from
the City to DTC, attached to this resolution as Exhibit B, which is hereby
incorporated herein by reference and made a part hereof.
(b) The Bonds shall be initially issued as separately authenticated fully registered
Bonds, and one Bond shall be issued in the principal amount of each stated maturity of
the Bonds. Upon initial issuance, the ownership of such Bonds shall be registered in the
Bond register in the name of Cede & Co., as nominee of DTC. The Registrar and the
City may treat DTC (or its nominee) as the sole and exclusive owner of the Bonds
registered in its name for the purposes of payment of the principal of or interest on the
Bonds, selecting the Bonds or portions thereof to be redeemed, if any, giving any notice
permitted or required to be given to registered owners of Bonds under this resolution,
registering the transfer of Bonds, and for all other purposes whatsoever; and neither the
Registrar nor the City shall be affected by any notice to the contrary. Neither the
Registrar nor the City shall have any responsibility or obligation to any Participant, any
Person claiming a beneficial ownership interest in the Bonds under or through DTC or
any Participant, or any other Person which is not shown on the Bond register as being a
registered owner of any Bonds, with respect to the accuracy of any records maintained by
DTC or any Participant, with respect to the payment by DTC or any Participant of any
amount with respect to the principal of or interest on the Bonds, with respect to any notice
which is permitted or required to be given to owners of Bonds under this resolution, with
respect to the selection by DTC or any Participant of any person to receive payment in the
event of a partial redemption of the Bonds, or with respect to any consent given or other
action taken by DTC as registered owner of the Bonds. So long as any Bond is registered
in the name of Cede & Co., as nominee of DTC, the Registrar shall pay all principal of
and interest on such Bond, and shall give all notices with respect to such Bond, only to
Cede & Co. in accordance with the Representation Letter, and all such payments shall be
valid and effective to fully satisfy and discharge the City's obligations with respect to the
principal of and interest on the Bonds to the extent of the sum or sums so paid. No
Person other than DTC shall receive an authenticated Bond for each separate stated
maturity evidencing the obligation of the City to make payments of principal and interest.
Upon delivery by DTC to the Registrar of written notice to the effect that DTC has
determined to substitute a new nominee in place of Cede & Co., the Bonds will be
transferable to such new nominee in accordance with paragraph (e) hereof.
(c) In the event the City determines that it is in the best interest of the Beneficial
Owners that they be able to obtain Bonds in the form of Bond certificates, the City may
notify DTC and the Registrar, whereupon DTC shall notify the Participants of the
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availability through DTC of Bonds in the form of certificates. In such event, the Bonds
will be transferable in accordance with paragraph (e) hereof. DTC may determine to.
discontinue providing its services with respect to the Bonds at any time by giving notice
to the City and the Registrar and discharging its responsibilities with respect thereto under
applicable law. In such event the Bonds will be transferable in accordance with
paragraph (e) hereof.
(d) The Representation Letter sets forth certain matters with respect to, among
other things, notices, consents and approvals by registered owners of the Bonds and
Beneficial Owners and payments on the Bonds. The Registrar shall have the same rights
with respect to its actions thereunder as it has with respect to its actions under this
resolution.
(e) In the event that any transfer or exchange of Bonds is permitted under
paragraph (b) or (c) hereof, such transfer or exchange shall be accomplished upon receipt
by the Registrar of the Bonds to be transferred or exchanged and appropriate instruments
of transfer to the permitted transferee in accordance with the provisions of this resolution.
In the event Bonds in the form of certificates are issued to owners other than Cede & Co.,
its successor as nominee for DTC as owner of all the Bonds, or another securities
depository as owner of all the Bonds, the provisions of this resolution shall also apply to
all matters relating thereto, including, without limitation, the printing of such Bonds in
the form of Bond certificates and the method of payment of principal of and interest on
such Bonds in the form of Bond certificates.
Section 3. Sinkin2: Fund: Assessments.
3.01. Sinking: Fund. There is hereby created and established the Sinking Fund
designated as the "2000 Pooled Special Improvement District Sinking Fund," which shall be
maintained by the Administrative Services Director on the books and records of the City separate
and apart from all other funds of the City. Within the Sinking Fund there shall be maintained
separate accounts for each of the Districts, designated accordingly (collectively, the "District
Accounts"). Within each District Account there shall be maintained three separate subaccounts,
designated as the "Acquisition Subaccount," "Principal Subaccount," "Interest Subaccount" and
"District Reserve Subaccount," respectively.
3.02. Acquisition Subaccounts. There shall be credited to the Acquisition
Subaccount in the District Accounts the proceeds of the sale of the Bonds attributable to the
respective District as provided in Section 2.07. Any earnings on investment of money in a
Acquisition Subaccount shall be retained therein. All costs and expenses of acquiring the
Improvements to be paid from proceeds of the Bonds in and for the benefit of a District shall be
paid as incurred and allowed from the Acquisition Subaccount in the respective District Account
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in accordance with the provisions of applicable law, and money in the Acquisition Subaccount
shall be used for no other purpose; provided that after all claims and expenses with respect to
such Improvements have been fully paid and satisfied, any money remaining in said Acquisition
Subaccount shall be transferred to the Principal Subaccount in the District Account for the
District and used to redeem Bonds as provided in Section 3.03.
3.03. Principal Subaccounts and Interest Subaccounts. Money in the Principal
Subaccounts and the Interest Subaccounts shall be used only for payment of the principal of and
interest on the Bonds as such payments become due or to redeem Bonds. From the proceeds of
the Bonds, there shall be deposited in the Interest Subaccounts any interest on the Bonds accrued
to the date of their delivery, pro rata, in proportion to the principal amount of Bonds issued for
such District as set forth in Section 1.06.
Upon collection of the installment of principal and interest due on November 30
and May 31 of each fiscal year on the special assessments to be levied with respect to the
Improvements in each of the Districts, the Administrative Services Director shall credit to the
Interest Subaccount in the respective District Account so much of said special assessments as is
collected as interest payment and the balance thereof to the Principal Subaccount. Any
installment of any special assessment paid prior to its due date with interest accrued thereon to
the next succeeding interest payment date shall be credited with respect to principal and interest
payments in the same manner as other assessments are credited to the District Account. All
money in the Interest Subaccount and the Principal Subaccount shall be used first to pay interest
due, and any remaining money shall be used to pay Bonds then due and, if money is available, to
redeem Bonds in accordance with Section 2.05; provided that any money transferred to a
Principal Subaccount from the Acquisition Subaccount pursuant to Section 3.02 shall be applied
to redeem Bonds to the extent possible on the next interest payment date for which notice of
redemption may properly be given pursuant to Section 2.05. Redemption of Bonds shall be as
provided in Section 2.05, and interest shall be paid as accrued thereon to the date of redemption,
in accordance with the provisions of Section 7-12-4206 of the Act.
3.04. Loans from Revolving Fund. The Commission shall annually or more often
if necessary issue an order authorizing a loan or advance from the Special Improvement District
Revolving Fund of the City (the "Revolving Fund") to each of the District Accounts in an
amount sufficient to make good any deficiency then existing in the Interest Subaccount in the
District Account, and shall issue an order authorizing a loan or advance from the Revolving Fund
to each of the District Accounts in an amount sufficient to make good any deficiency then
existing in the Principal Subaccount of the District Account, in such order and in each case to the
extent that money is available in the Revolving Fund; provided, however, that at the time any
such loan or advance is to be made, the respective District Reserve Subaccount shall have been
or shall be depleted on the next interest payment date. A deficiency shall be deemed to exist in a
Principal Subaccount or an Interest Subaccount in a District Account if the money on deposit
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therein, together with any funds on deposit in the District Reserve Subaccount, on any December
15 or June 15 (excluding amounts in the Principal Subaccount representing prepaid special
assessments) is less than the amount necessary to pay Bonds due (other than upon redemption),
and interest on all Bonds payable, on the next succeeding interest payment date.
Pursuant to Ordinance No. 612, the City has undertaken and agreed to provide
funds for the Revolving Fund by levying such tax or making such loan from the General Fund as
authorized by Montana Code Annotated, Section 7-12-4222. In the event that the balance on
hand in the Revolving Fund fifteen days prior to any date when interest is due on special
improvement district bonds or warrants of the City is not sufficient to make good all deficiencies
then existing in the special improvement district funds for which the City has covenanted to
make loans from the Revolving Fund, the balance on hand in the Revolving Fund shall be
allocated to the funds of the special improvement districts in which such deficiencies then exist
in proportion to the amounts of the deficiencies on the respective dates of receipt of such money,
until all interest accrued on such special improvement district bonds or warrants of the City has
been paid. On any date when all accrued interest on special improvement district bonds and
warrants of the City payable from funds for which the City has covenanted to make loans from
the Revolving Fund has been paid, any balance remaining in the Revolving Fund shall be lent or
advanced to the special improvement district funds for payment and redemption of bonds to the
extent the special improvement district funds are deficient for such purpose, and, if money in the
Revolving Fund is insufficient therefor, pro rata, in an amount proportionate to the amount of
such deficiency.
The City hereby determines, covenants and agrees to levy the property tax
described in the immediately preceding paragraph to provide funds for the Revolving Fund so
long as any Bonds are outstanding to the extent required under the provisions of this Resolution
and the Act, even though such property tax levy may, under applicable law (including SB 184,
adopted by the Montana Legislature in 1999), require that property tax levies of the City for other
purposes be reduced correspondingly.
Section 4. Covenants. The City covenants and agrees with the owners from time
to time of each of the Bonds that until all the Bonds and interest thereon are fully paid:
4.01. Compliance with Resolution. The City will hold the Sinking Fund and the
Revolving Fund as trust funds, separate and apart from all of its other funds, and the City, its
officers and agents, will comply with all covenants and agreements contained in this resolution.
The provisions hereinabove made with respect to the Sinking Fund and the Revolving Fund are
in accordance with the undertaking and agreement of the City made in connection with the public
offering of the Bonds and the sale of the Bonds as set forth in Section 1.06.
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4.02. Payment for hnorovements. The hnprovements have been constructed and
from the proceeds of the Bonds the City will immediately acquire the Improvements for the
benefit of the Districts and will pay the costs thereof promptly out of the District Accounts and
within the amount of the proceeds of the Bonds appropriated thereto.
4.03. Levy of Assessments. The City will do all acts and things necessary for the
final and valid levy of special assessments upon all assessable real property within the boundaries
of the Districts in accordance with the Constitution and laws of the State of Montana and the
Constitution of the United States in an aggregate principal amount not less than the following
amounts for each of the Districts:
District No. Principal Amount
666 $1,335,000
667 $575,000
668 $720,000
Such special assessments shall be levied on the basis or bases prescribed in the Resolutions of
Intention and shall be payable in semiannual installments over a period of 19 years, each
installment being due in an amount equal to one-thirty-eighth of the principal amount of each
assessment, with interest on the whole amount remaining unpaid at an annual rate equal to the
sum of: (i) the average annual interest rate borne by the Bonds, plus (ii) one-half of one percent
(0.50%) per annum, interest being payable with principal installments. The assessments to be
levied will be payable on the 30th day of November in each of the years 2000 through 2018, and
on the 31st day of May in the years 2001 through 2019, inclusive, if not theretofore paid, and
shall become delinquent on such date unless paid in full. The first partial payment of each
assessment shall include interest on the entire assessment from the date of original registration of
the Bonds to May 31, 2019 and each subsequent partial payment shall include interest for six
months on that payment and the then remaining balance of the special assessment. The
assessments shall constitute a lien upon and against the property against which they are made and
levied, which lien may be extinguished only by payment of the assessment with all penalties, cost
and interest as provided in Montana Code Annotated, Section 7-12-4191. No tax deed issued
with respect to any lot or parcel of land shall operate as payment of any installment of the
assessment thereon which is payable after the execution of such deed, and any tax deed so issued
shall convey title subject only to the lien of said future installments, as provided in Montana
Code Annotated, Section 15-18-214.
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4.04. Reassessment. If at any time and for whatever reason any special
assessment or tax herein agreed to be levied is held invalid, the City and this Commission, its .
officers and employees, will take all steps necessary to correct the same and to reassess and re-
levy the same, induding the ordering of work, with the same force and effect as if made at the
time provided by ]aw, ordinance or resolution relating thereto, and will reassess and re-Ievy the
same with the same force and effect as an original levy thereof, as authorized in Montana Code
Annotated, Section 7-]2-4186. Any special assessment, or reassessment or re-Ievy shall, so far
as is practicable, be levied and collected as it would have been if the first levy had been enforced
induding the levy and collection of any interest accrued on the first levy.
If proceeds of the Bonds, induding investment income thereon, are applied to the
redemption of such Bonds, as provided in Montana Code Annotated, Sections 7-12-4205 and 7-
12-4206, or if refunding bonds are issued and the principal amount of the outstanding Bonds of
the Districts is decreased or increased, the City will reduce or increase, respectively, the
assessments levied in the respective Districts and then outstanding pro rata by the principal
amount of such prepayment or the increment above or below the outstanding principal amount of
bonds represented by the refunding bonds. The City and this Commission, its officers and
employees will reassess and re-Ievy such assessments, with the same effect as an original levy, in
such reduced or increased amounts in accordance with the provisions of Montana Code
Annotated, Sections 7-12-4176 through 7-12-4178.
4.05. Absence of Litigation. There is now no litigation pending or, to the best
knowledge of the City, threatened questioning the validity or regularity of the creation of the
Districts, the contracts for construction of the Improvements or the undertaking and agreement of
the City to levy special assessments therefor and to make good any deficiency in the collection
thereof through the levy of taxes for and the making of advances from the Revolving Fund, or the
right and power of the City to issue the Bonds or in any manner questioning the existence of any
condition precedent to the exercise of the City's powers in these matters. If any such litigation
should be initiated or threatened, the City will forthwith notify in writing the Purchaser, and will
furnish the Purchaser a copy of all documents, induding pleadings, in connection with such
litigation.
4.06. Waiver of Penal tv and Interest. The City covenants not to waive the
payment of penalty or interest on delinquent assessments levied on property in the Districts for
costs of the Improvements, unless the City determines, by resolution of the City Commission,
that such waiver is in the best interest of the owners of the outstanding Bonds.
Section 5. Tax Matters.
5.01. Use of Improvements. The Improvements will be owned and operated by
the City and available for use by members of the general public on a substantially equal basis.
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The City shall not enter into any lease, use or other agreement with any non-governmental person
relating to the use of the hnprovements or security for the payment of the Bonds which might
cause the Bonds to be considered "private activity bonds" or "private loan bonds" within the
meaning of Section 141 of the Internal Revenue Code of 1986, as amended (the "Code").
5.02. General Covenant. The City covenants and agrees with the owners from
time to time of the Bonds that it will not take or permit to be taken by any of its officers,
employees or agents any action which would cause the interest on the Bonds to become
includable in gross income for federal income tax purposes under the Code and applicable
Treasury Regulations (the "Regulations"), and covenants to take any and all actions within its
powers to ensure that the interest on the Bonds will not become includable in gross income for
federal income tax purposes under the Code and the Regulations.
5.03. Arbitrage Certification. The Mayor, the City Manager, the Administrative
Services Director and the Clerk of the Commission, being the officers of the City charged with
the responsibility for issuing the Bonds pursuant to this resolution, are authorized and directed to
execute and deliver to the Purchaser a certificate in accordance with the provisions of Section
148 of the Code, and Section 1. 148-2(b) of the Regulations, stating that on the basis of facts,
estimates and circumstances in existence on the date of issue and delivery of the Bonds, it is
reasonably expected that the proceeds of the Bonds will be used in a manner that would not cause
the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code and the
Regulations.
5.04. Arbitrage Rebate ExemDtion.
(a) The City hereby represents that the Bonds qualify for the exception for small
governmental units to the arbitrage rebate provisions contained in Section 148(f) of the Code.
Specifically, the City represents:
(1) Substantially all (not less than 95%) of the proceeds of the Bonds
(except for amounts to be applied to the payment of costs of issuance and amounts to be
deposited in the Interest Subaccounts pursuant to Section 3.03) will be used for local
governmental activities of the City.
(2) The aggregate face amount of all "tax-exempt bonds" (including warrants,
contracts, leases and other indebtedness, but excluding private activity bonds) issued by
or on behalf of the City and all subordinate entities thereof during 2000 is reasonably
expected not to exceed $5,000,000. To date in 2000, the City has issued no such tax-
exempt bonds, and in the calendar years 1995 through 1999, the average principal amount
of such tax-exempt bonds issued by the City in a single calendar year was $1,737,450.
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(b) If notwithstanding the provisions of paragraph (a) of this Section 5.04, the
arbitrage rebate provisions of Section 148(0 of the Code apply to the Bonds, the City hereby
covenants and agrees to make the determinations, retain records and rebate to the United States
the amounts at the times and in the manner required by said Section 148(0.
5.05. Information Reporting:. The City shall file with the Secretary of the
Treasury, not later than February 15,2001, a statement concerning the Bonds containing the
information required by Section 149( e) of the Code.
5.06. "Qualified Tax-Exempt Obligations." Pursuant to Section 265(b)(3)(B)(ii)
of the Code, the City hereby designates the Bonds as "qualified tax-exempt obligations" for
purposes of Section 265(b)(3) of the Code. The City has not designated any obligations in 2000
other than the Bonds under Section 265(b)(3). The City hereby represents that it does not
anticipate that obligations bearing interest not includable in gross income for purposes of federal
income taxation under Section 103 of the Code (including refunding obligations as provided in
Section 265(b)(3) of the Code and including "qualified 501(c)(3) Bonds" but excluding other
"private activity bonds," as defined in Sections 14l(a) and l45(a) of the Code) will be issued by
or on behalf of the City and all "subordinate entities" of the City in 2000 in an amount greater
than $10,000,000.
Section 6. Authentication of Transcript. The officers of the City are hereby
authorized and directed to furnish to the Purchaser and to bond counsel certified copies of all
proceedings relating to the issuance of the Bonds and such other certificates and affidavits as may
be required to show the right, power and authority of the City to issue the Bonds, and all
statements contained in and shown by such instruments, including any heretofore furnished, shall
constitute representations of the City as to the truth of the statements purported to be shown
thereby.
Section 7. Discharge.
7.01. General. When the liability of the City on all Bonds issued under and
secured by this resolution has been discharged as provided in this Section 7, all pledges,
covenants and other rights granted by this resolution to the owners of such obligations shall
cease.
7.02. Payment. The City may discharge its liability with reference to any Bond or
installment of interest thereon which is due on any date by on or before that date depositing with
the Registrar funds sufficient, or, if a City officer is the Registrar, mailing to the registered owner
of such Bond a check or draft in a sum sufficient and providing proceeds available, for the
payment thereof in full; or if any Bond or installment of interest thereon shall not be paid when
due, the City may nevertheless discharge its liability with reference thereto by depositing with the
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Registrar funds sufficient, or, if a City officer is the Registrar, by mailing to the registered owner
thereof a check or draft in a sum sufficient and providing proceeds available, for the payment
thereof in full with interest accrued to the date of such deposit or mailing.
7.03. Prepayment. The City may also discharge its obligations with respect to
any Bonds called for redemption on any date when they are prepayable according to their terms,
by on or before that date depositing with the Registrar funds sufficient, or, if a City officer is the
Registrar, mailing to the registered owner of such Bond a check or a draft in a sum sufficient and
providing proceeds available, for the payment of the principal, interest and redemption premium,
if any, which are then due; provided that notice of such redemption has been duly given as
provided herein or irrevocably provided for.
7.04. Escrow. The City may also at any time discharge its liability in its entirety
with reference to the Bonds, subject to the provisions of law now or hereafter authorizing and
regulating such action, by depositing irrevocably in escrow, with a bank qualified by law as an
escrow agent for this purpose, cash or securities which are authorized by law to be so deposited,
bearing interest payable at such times and at such rates and maturing on such dates as shall be
required, without reinvestment, to provide funds sufficient to pay all principal and interest to
become due on all Bonds on or before maturity or, if any Bond has been duly called for
redemption or notice of such redemption has been irrevocably provided for, on or before the
designated redemption date.
7.05. Irrevocable Deposits. If an officer of the City is the Registrar, any deposit
made under this Section 7 with the Registrar shall be irrevocable and held for the benefit of the
owners of Bonds in respect of which such deposits have been made.
Section 8. Continuing: Disclosure.
Section 8. Continuine: Disclosure.
(a) Pm:pose and Beneficiaries. To provide for the public availability of certain
information relating to the Bonds and the security therefor and to permit the original purchaser
and other participating underwriters in the primary offering of the Bonds to comply with
amendments to Rule 15c2-12 promulgated by the Securities and Exchange Commission (the
"SEC") under the Securities Exchange Act of 1934 (17 C.ER. ~ 240. 15c2-12), relating to
continuing disclosure (as in effect and interpreted from time to time, the "Rule"), which will
enhance the marketability of the Bonds, the City hereby makes the following covenants and
agreements for the benefit of the Owners (as hereinafter defined) from time to time of the
Outstanding Bonds. The District and the Revolving Fund are the only "obligated persons" in
respect of the Bonds within the meaning of the Rule for purposes of identifying the entities in
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respect of which continuing disclosure must be made. The City has complied in all material
respects with any undertaking previously entered into by it under the Rule.
If the City fails to comply with any provisions of this Section 8, any person
aggrieved thereby, including the Owners of any Outstanding Bonds, may take whatever action at
law or in equity may appear necessary or appropriate to enforce performance and observance of
any agreement or covenant contained in this Section 8, including an action for a writ of
mandamus or specific performance. Direct, indirect, consequential and punitive damages shall
not be recoverable for any default hereunder to the extent permitted by law. Notwithstanding
anything to the contrary contained herein, in no event shall a default under this Section 8
constitute a default under the Bonds or under any other provision of this resolution.
As used in this Section 8, "Owner" or "Bondowner" means, in respect of a Bond,
the registered owner or owners thereof appearing in the bond register maintained by the Registrar
or any "Beneficial Owner" (as hereinafter defined) thereof, if such Beneficial Owner provides to
the Registrar evidence of such beneficial ownership in form and substance reasonably
satisfactory to the Registrar. As used herein, "Beneficial Owner" means, in respect of a Bond,
any person or entity which (i) has the power, directly or indirectly, to vote or consent with respect
to, or to dispose of ownership of, such Bond (including persons or entities holding Bonds
through nominees, depositories or other intermediaries), or (b) is treated as the owner of the
Bond for federal income tax purposes.
(b) Information To Be Disclosed. The City will provide, in the manner set forth
in subsection (c) hereof, either directly or indirectly through an agent designated by the City, the
following information at the following times:
(1) on or before 270 days after the end of each fiscal year of the City, commencing with
the fiscal year ending June 30, 2000, the following financial information and operating data in
respect of the City (the "Disclosure Information "):
(A) the comprehensive annual financial report of the City for such
fiscal year, containing the audit report and opinion of the accountant or
government auditor relating thereto, as permitted or required by the laws
of the State of Montana, containing balance sheets as of the end of such
fiscal year and a statement of operations, changes in fund balances and
cash flows for the fiscal year then ended, for required funds, prepared in
accordance with generally accepted accounting principles promulgated by
the Financial Accounting Standards Board, as modified in accordance with
the governmental accounting standards promulgated by the Governmental
Accounting Standards Board or as otherwise provided under Montana law,
as in effect from time to time, or, if and to the extent such financial
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statements have not been prepared in accordance with such generally
accepted accounting principles for reasons beyond the reasonable control
of the City, noting the discrepancies therefrom and the effect thereof, and
certified as to accuracy and completeness in all material respects by the
Administrative Services Director; and
(B) To the extent not included in the financial report referred to in
paragraph (A) hereof, the information of the type set forth below contained
in the official statement dated October 11, 2000 (the "Official Statement"),
for such fiscal year or for the period most recently available, which
information may be unaudited, but is to be certified as to accuracy and
completeness in all material respects by the Administrative Services
Director as to the best of his or her knowledge (which certification may be
based on the reliability of information obtained from third party sources):
(1) updated information for the then most recent completed fiscal year in
format similar to the table in the section entitled "Revolving Fund" of the
Official Statement concerning the Revolving Fund Cash Balance and
outstanding bonds secured thereby; and
(2) updated information for the then most recent completed fiscal year in
format similar to the table in the section entitled "Summary of Outstanding
Special Improvement Districts" concerning the Bonds and other
outstanding special improvement district bonds of the City, including any
special improvement district bonds issued after the date of the Official
Statement;
(3) updated information for the then most recent completed fiscal year in
format similar to the table in the section entitled "Special Improvement
District Assessment Billings and Collections" of the Official Statement;
(4) updated information for the then most recent completed fiscal year in
format similar to the table in the section entitled "Statement of Changes in
Fund Balance of the Revolving Fund", including the amount of loans to
the District, if any;
(5) the market and taxable valuations of the City for the then current fiscal
year; and
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(6) tax collection infonnation for the then most recent completed fiscal year in
fonnat similar to the table in the section entitled "Tax Collections" in
Appendix A of the Official Statement.
Notwithstanding the foregoing, if the audited financial statements are not
available by the date specified, the City shall provide on or before such date unaudited financial
statements in the fonnat required for the audited financial statements as part of the Disclosure
Infonnation and, within 10 days after the receipt thereof, the City shall provide the audited
financial statements.
Any or all of the Disclosure Infonnation may be incorporated by reference, if it is
updated as required hereby from other documents, including official statements, which have been
submitted to each of the repositories hereinafter referred to under subsection (c) or the SEC. If
the document incorporated by reference is a final Official Statement, it must be available from
the Municipal Securities Rulemaking Board. The City shall clearly identify in the Disclosure
Infonnation each document so incorporated by reference.
If any part of the Disclosure Infonnation can no longer be generated because the
operations of the City have materially changed or been discontinued, such Disclosure
Infonnation need no longer be provided if the City includes in the Disclosure Infonnation a
statement to such effect; provided, however, if such operations have been replaced by other City
operations in respect of which data is not included in the Disclosure Infonnation and the City
detennines that certain specified data regarding such replacement operations would be a Material
Fact (as defined in paragraph (3) hereof), then, from and after such detennination, the Disclosure
Infonnation shall include such additional specified data regarding the replacement operations.
If the Disclosure Infonnation is changed or this Section 8 is amended as pennitted
by this paragraph (b)(l) or subsection (d), then the City shall include in the next Disclosure
Infonnation to be delivered hereunder, to the extent necessary, an explanation in narrative fonn
of the reasons for the amendment and the effect of any change in the type of financial
infonnation or operating data provided.
(2) In a timely manner, notice of the occurrence of any of the following events which is a
Material Fact (as hereinafter defined):
(A) Principal and interest payment delinquencies;
(B) Non-payment related defaults;
(C) Unscheduled draws on debt service reserves reflecting financial
difficulties;
(D) Unscheduled draws on credit enhancements reflecting financial
difficulties;
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(E) Substitution of credit or liquidity providers, or their failure to
perform;
(F) Adverse tax opinions or events affecting the tax-exempt status of
the security;
(G) Modifications to rights of security holders;
(H) Bond calls;
(I) Defeasances;
(J) Release, substitution, or sale of property securing repayment of
the securities; and
(K) Rating changes.
As used herein, a "Material Fact" is a fact as to which a substantial likelihood
exists that a reasonably prudent investor would attach importance thereto in deciding to buy, hold
or sell a Bond or, if not disclosed, would significantly alter the total information otherwise
available to an investor from the Official Statement, information disclosed hereunder or
information generally available to the public. Notwithstanding the foregoing sentence, a
"Material Fact" is also an event that would be deemed "material" for purposes of the purchase,
holding or sale of a Bond within the meaning of applicable federal securities laws, as interpreted
at the time of discovery of the occurrence of the event.
(3) In a timely manner, notice of the occurrence of any of the following events
or conditions:
(A) the failure of the City to provide the Disclosure Information
required under paragraph (b)( 1) at the time specified thereunder;
(B) the amendment or supplementing of this Section 8 pursuant to
subsection (d), together with a copy of such amendment or supplement and
any explanation provided by the City under subsection (d)(2);
(C) the termination of the obligations of the City under this Section 8
pursuant to subsection (d);
(D) any change in the accounting principles pursuant to which the financial
statements constituting a portion of the Disclosure Information are prepared; and
(E) any change in the fiscal year of the City.
(c) Manner of Disclosure. The City agrees to make available the information
described in subsection (b) to the following entities by telecopy, overnight delivery, mail or other
means, as appropriate:
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(1) the information described in paragraph (1) of subsection (b), to each then
nationally recognized municipal securities information repository under the Rule and to any state
information depository then designated or operated by the State of Montana as contemplated by
the Rule (the "State Depository"), if any;
(2) the information described in paragraphs (2) and (3) of subsection (b), to the
Municipal Securities Rulemaking Board and to the State Depository, if any; and
(3) the information described in subsection (b), to any rating agency then
maintaining a rating of the Bonds and, at the expense of such Bondowner, to any Bondowner
who requests in writing such information, at the time of transmission under paragraphs (1) or (2)
of this subsection (c), as the case may be, or, if such information is transmitted with a subsequent
time of release, at the time such information is to be released.
(d) Term: Amendments: Interpretation.
(1) The covenants of the City in this Section 8 shall remain in effect so long as
any Bonds are Outstanding. Notwithstanding the preceding sentence, however, the obligations of
the City under this Section 8 shall terminate and be without further effect as of any date on which
the City delivers to the Registrar an opinion of Bond Counsel to the effect that, because of
legislative action or final judicial or administrative actions or proceedings, the failure of the City
to comply with the requirements of this Section 8 will not cause participating underwriters in the
primary offering of the Bonds to be in violation of the Rule or other applicable requirements of
the Securities Exchange Act of 1934, as amended, or any statutes or laws successory thereto or
amendatory thereof.
(2) This Section 8 and the form and requirements of the Disclosure Information
may be amended or supplemented by the City from time to time, without notice to (except as
provided in paragraph (c)(3) hereof) or the consent of the Owners of any Bonds, by a resolution
of the City Commission filed in the office of the Clerk of the Commission of the City
accompanied by an opinion of Bond Counsel, who may rely on certificates of the City and others
and the opinion may be subject to customary qualifications, to the effect that: (i) such
amendment or supplement (a) is made in connection with a change in circumstances that arises
from a change in law or regulation or a change in the identity, nature or status of the City or the
type of operations conducted by the City, or (b) is required by, or better complies with, the
provisions of paragraph (b)(5) of the Rule; (ii) this Section 8 as so amended or supplemented
would have complied with the requirements of paragraph (b )(5) of the Rule at the time of the
primary offering of the Bonds, giving effect to any change in circumstances applicable under
clause (i)(a) and assuming that the Rule as in effect and interpreted at the time of the amendment
or supplement was in effect at the time of the primary offering; and (iii) such amendment or
supplement does not materially impair the interests of the Bondowners under the Rule.
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If the Disclosure Information is so amended, the City agrees to provide,
contemporaneously with the effectiveness of such amendment, an explanation, in narrative form,
of the reasons for the amendment and the effect, if any, of the change in the type of financial
information or operating data being provided hereunder.
(3) This Section 8 is entered into to comply with the continuing disclosure
provisions of the Rule and should be construed so as to satisfy the requirements of paragraph
(b)(5) of the Rule.
(e) Further Limitation of Liability of City. In and to the extent the limitations of
liability contained in subsection (a) are not effective, anything contained in this Section 8 to the
contrary notwithstanding, in making the agreements, provisions and covenants set forth in this
Section 8, the City has not obligated itself except with respect to the assessments pledged to pay
the Bonds and the covenant to utilize the Revolving Fund as permitted by law and described
herein. None of the agreements or obligations of the City contained herein shall be construed to
constitute an indebtedness of the City within the meaning of any constitutional or statutory
provisions whatsoever or constitute a pledge of the general credit or taxing powers of the City.
Section 9. Repeals and Effective Date.
9.01. Repeal. All provisions of other resolutions and other actions and
proceedings of the City and this Commission that are in any way inconsistent with the terms and
provisions of this resolution are repealed, amended and rescinded to the full extent necessary to
give full force and effect to the provisions of this resolution.
9.02. Effective Date. This resolution shall take effect immediately upon its
passage and adoption by this Commission.
PASSED AND ADOPTED by the City Commission of the City of Bozeman,
Montana, this 16th day of October, 2000.
(SEAL) ~(5~
Mayor
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Attest: ~--Id~
Clerk -of-the CciininisSion
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APPROVED AS TO FORM:
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EXHIBIT A
[Face of the Bond]
UNITED STATES OF AMERICA
STATE OF MONT ANA
GALLATIN COUNTY
CITY OF BOZEMAN
POOLED SPECIAL IMPROVEMENT
DISTRICT BOND, SERIES 2000
(Special Improvement District Nos. 666, 667 and 668)
Interest at the rate per annum specified below,
payable January 1,2001 and semiannually thereafter
on the 1st day of January and the 1st day of July
in each year.
No.R- ~
$
Date of Original
Rate Maturitv Issue
CUSIP
% July 1, October 15,2000
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
FOR VALUE RECEIVED, the City of Bozeman, Gallatin County, Montana, will
pay to the registered owner identified above, or registered assigns, on the maturity date specified
above the principal amount specified above, solely from the revenues hereinafter specified, as
authorized by Resolution No. , adopted October 16,2000 (the "Resolution"), all
subject to the provisions hereinafter described relating to the redemption of this Bond before
maturity. This Bond bears interest at the rate per annum specified above from the date of
registration of this Bond, as expressed herein, or from such later date to which interest hereon has
been paid or duly provided for, until the maturity date specified above or an earlier date on which
this Bond shall have been duly called for redemption by the Administrative Services Director.
Interest on this Bond is payable semiannually, commencing January 1,2001, on the 1st day of
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January and the 1st day of July in each year, to the owner of record of this Bond appearing as
such in the bond register as of the close of business on the 15th day (whether or not such is a
business day) of the immediately preceding month. Interest on and, upon presentation and
surrender hereof at the principal office of the bond registrar and paying agent hereinafter named,
the principal of this Bond is payable by check or draft of the Administrative Services Director of
the City of Bozeman, Montana, as bond registrar and paying agent, or its successor designated
under the Resolution (the "Registrar"). The principal of and interest on this Bond are payable in
lawful money of the United States of America.
Notwithstanding any other provisions of this Bond, so long as this Bond is
registered in the name of Cede & Co., as nominee of The Depository Trust Company, or in the
name of any other nominee of The Depository Trust Company or other securities depository, the
Registrar shall pay all principal of and interest on this Bond, and shall give all notices with
respect to this Bond, only to Cede & Co. or other nominee in accordance with the operational
arrangements of The Depository Trust Company or other securities depository as agreed to by the
City.
This Bond is one of an issue in the aggregate principal amount of $2,630,000 (the
"Bonds"), all of like date of original issue and tenor, except as to serial number, denomination,
date, interest rate and maturity date. The Bonds are issued pursuant to and in full conformity
with the Constitution and laws of the State of Montana thereunto enabling, including Montana
Code Annotated, Title 7, Chapter 12, Parts 41 and 42, as amended, to finance the costs of certain
local improvements (the "hnprovements") for the special benefit of property located in the
following Special Improvement Districts of the City: Special Improvement District Nos. 666,
667, and 668 (collectively, the "Districts"). The Bonds are issuable only as fully registered bonds
of single maturities in denominations of $5,000 or any integral multiple thereof.
This Bond is payable from the collection of a special tax or assessment levied
upon all assessable real property within the boundaries of the Districts, in an aggregate principal
amount of not less than $1,335,000 for Special Improvement District No. 666, $575,000 for
Special hnprovement District No. 667 and $720,000 for Special hnprovement District No. 668,
except as such amounts may be reduced or increased in accordance with provisions of Montana
law. Such assessments constitute a lien against the assessable real estate within the Districts, and
the Bonds are not general obligations of the City. The City has established in each District
Account, and funded with certain proceeds of the Bonds, a District Reserve Subaccount (the
"Reserve Subaccount"), from which moneys are to be applied to pay principal of and interest on
the Bonds in the event collections of special assessments are insufficient therefor. There is no
obligation for the City to replenish the Reserve Subaccounts if funds are withdrawn therefrom.
The City has also validly established a Special hnprovement District Revolving
Fund (the "Revolving Fund") to secure the payment of certain of its special improvement district
bonds, including the Bonds. The City has also agreed, to the extent permitted by the Act, to issue
orders annually authorizing loans or advances from the Revolving Fund to the 2000 Pooled
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Special hnprovement District Sinking Fund of the City (in which the district fund for each of the
special improvement districts described in the title hereof constitutes an account) (the "Sinking
Fund"), in amounts sufficient to make good any deficiency in the Sinking Fund to pay principal
of or interest on the Bonds after depletion of the respective Reserve Subaccount, to the extent
that funds are available in the Revolving Fund, and to provide funds for the Revolving Fund by
annually making a tax levy or loan from its general fund in an amount sufficient for that purpose,
subject to the limitation that no such tax levy or loan may in any year cause the balance in the
Revolving Fund to exceed five percent of the principal amount of the City's then outstanding
special improvement district bonds secured thereby and the durationallimitations specified in the
Act. While any property tax levy to be made by the City to provide funds for the Revolving Fund
is subject to levy limits under current law, the City has agreed in the Bond Resolution to levy
property taxes to provide funds for the Revolving Fund to the extent described in this paragraph
and, if necessary, to reduce other property tax levies correspondingly to meet applicable levy
limits.
The Bonds are subject to mandatory redemption in order of stated maturities and
within a stated maturity in $5,000 principal amounts selected by lot or other manner deemed fair
by the Registrar, on any interest payment date if, after paying all principal and interest then due
on the Bonds, there are funds to the credit of the Sinking Fund, from the prepayment of
assessments levied in the District or from surplus proceeds of the Bonds not required to pay costs
of the hnprovements, for the redemption thereof, and in the manner provided for the redemption
of the same. The Bonds are subject to redemption at the option of the City from other sources of
funds available therefor on any interest payment date; provided, however, that the City hereby
agrees that the Bonds are not to be called for redemption (i) from amounts on deposit in the
Reserve Subaccounts in the District Accounts or (ii) before July 1,2005, from the proceeds of
refunding special improvement district bonds or warrants. The redemption price is equal to the
principal amount of the Bonds or portions thereof to be redeemed plus interest accrued thereon to
the date of redemption. The date of redemption shall be fixed by the Administrative Services
Director, who shall give notice by first class mail, postage prepaid, to the owner or owners of
such Bonds at their addresses shown on the bond register, of the Bonds or portions thereof to be
redeemed and the date on which payment will be made, which date shall not be less than thirty
(30) days after the date of mailing of notice, on which date so fixed interest shall cease. On the
date so fixed interest on the Bonds or portions thereof so redeemed shall cease to accrue. Upon
partial redemption of any Bond, a new Bond or Bonds will be delivered to the registered owner
without charge, representing the remaining principal amount outstanding.
The Bonds have been designated by the City as "qualified tax-exempt
obligations" pursuant to Section 265 of the Internal Revenue Code of 1986, as amended.
As provided in the Resolution and subject to certain limitations set forth therein,
this Bond is transferable upon the books of the City at the principal office of the Registrar, by the
registered owner hereof in person or by his attorney duly authorized in writing upon surrender
hereof together with a written instrument of transfer satisfactory to the Registrar, duly executed
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by the registered owner or his attorney; and may also be surrendered in exchange for Bonds of
other authorized denominations. Upon such transfer or exchange, the City will cause a new
Bond or Bonds to be issued in the name of the transferee or registered owner, of the same
aggregate principal amount, bearing interest at the same rate and maturing on the same date,
subject to reimbursement for any tax, fee or governmental charge required to be paid with respect
to such transfer or exchange.
The City and the Registrar may deem and treat the person in whose name this
Bond is registered as the absolute owner hereof, whether this Bond is overdue or not, for the
purpose of receiving payment and for all other purposes, and neither the City nor the Registrar
shall be affected by any notice to the contrary.
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that
all things required to be done precedent to the issuance of this Bond have been properly done,
happened and been performed in the manner prescribed by the laws of the State of Montana and
the resolutions and ordinances of the City of Bozeman, Montana, relating to the issuance thereof;
and that the opinion attached hereto is a true copy of the legal opinion given by Bond Counsel
with reference to the Bonds, dated the date of original issuance and delivery of the Bonds.
This Bond shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Resolution until the Certificate of Authentication herein shall
have been executed by the Registrar by the manual signature of one of its authorized
representati ves.
IN WITNESS WHEREOF, the City of Bozeman, Gallatin County, Montana, by
its City Commission, has caused this Bond and the certificate hereof to be executed by the
facsimile signatures of the Mayor, the City Manager and the Clerk of the Commission, and by a
printed facsimile of the official seal of the City.
CITY OF BOZEMAN, MONTANA
(Facsimile Signature)
Mayor
(Facsimile Signature)
(Facsimile Seal) City Manager
(Facsimile Signature)
Clerk of the Commission
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____n____
. ,
, .
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned herein.
ADMINISTRATNE SERVICES DIRECTOR
OF THE CITY OF BOZEMAN, MONTANA,
as Bond Registrar, Transfer Agent
and Paying Agent
By
Authorized Representative
The following abbreviations, when used in the inscription on the face of this
Bond, shall be construed as though they were written out in full according to applicable laws or
regulations:
TEN COM -- as tenants UTMA........ ...Custodian......... ......
m common (Cust) (Minor)
TEN ENT -- as tenants
by the entireties
under Uniform Transfers to Minors
JT TEN -- as joint tenants Act............................. .
with right of (State)
survivorship and
not as tenants in
common
Additional abbreviations may also be used.
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ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
the within Bond and all rights thereunder, and hereby irrevocably
constitutes and appoints attorney to transfer the within Bond
on the
books kept for registration thereof, with full power of substitution in the premises.
Dated:
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE: NOTICE: The signature to this
assignment must correspond with the
name as it appears upon the face of the
within Bond in every particular, without
I I alteration, enlargement or any change
whatsoever.
SIGNATURE GUARANTEED
Signature(s) must be guaranteed by an
"eligible guarantor institution" meeting
the requirements of the Bond Registrar,
which requirements include membership
or participation in STAMP or such other
"signature guaranty program" as may be
determined by the Bond Registrar in
addition to or in substitution for STAMP,
all in accordance with the Securities
Exchange Act of 1934, as amended.
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EXHIBIT B
]IJ
Blanket Issuer Letter of Representations
[To be Completed by Issuer]
CIn OF BOZEMAN. MONTANA
[Name of Issuer]
April 17. 1995
[Date]
Attention: Underwriting Department - Eligibility
The Depository Trust Company
55 Water Street; 50th Floor
New York, NY 10041-0099
Ladies and Gentlemen:
This letter sets forth our understanding with respect to all issues (the "Securities") that Issuer
shall request be made eligible for deposit by The Depository Trust Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit at DTC, and to act in accordance
with DTC's Rules with respect to the Securities, Issuer represents to DTC that Issuer will comply
with the requirements stated in DTC's Operational Arrangements, as they may be amended from
time to time.
Note: Very truly yours,
Schedule A contains statements that OTC believes
accurately describe DTC, the method of effectinf book.
entry transfers of securities distributed through 0 C, and CITY OF BOZEMAN, MONTANA
certain related matters. ~u~r
.
(Authorized Officer's Signa
James E. Wysocki
Received and Accepted: City Manager
City of Bozeman
P. O. Box 640
THE DEPOSITORY TRUST COMPANY Bozeman, Montana 59715
o-a--~~~ (406) 582-2300
By:
r
23
R,-'~.. I Y1 ~/'H
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5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
r 6. Redemption notices shall be sent to Cede & Co. If less than all of the Securities within an issue are
being redeemed, DTC's practice is to detennine by lot the amount of the interest of each Direct
Participant in such issue to be redeemed]
7. Neither DTC nor Cede & Co. will consent or vote with respect to Securities. Under its usual
procedW'eS, DTC mails an Omnibus Proxy to the Issuer as soon as possible after the record date. The
Omnibus Proxy assigns Cede & Co. s consenting or voting rights to those Direct Participants to whose
accounts the Securities are credited on the record date (identified in a listing attached to the Omnibus
Proxy).
8. Principal and interest payments on the Securities will be made to DTC. DTCs practice is to credit
Direct Participants' accounts on payable date in accordance with their respective holdings shown on
DTC's records unless DTC has reason to believe that it will not receive payment on payable date.
Payments by Participants to Beneficial Owners will be governed by standing instrucIions and customary
practices, as is the case with securities held for the accounts of customers in bearer fonn or registered in
"street name," and will be the responsibility of such Participant and not of DTC, the Agent, or the
Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time.
Payment of principal and interest to DTC is the responsibility of the Issuer or the Agent, disbursement
of such payments to Direct Participants shall be the responsibility of DTC, and disbursement of such
pa~ents to the Beneficial Owners shall be the responsibility of Direct and Indirect Participants.
[9. A Beneficial Owner shall give notice to elect to have its Securities purchased or tendered, through
its Participant, to the [TenderlRemarketing] Agent, and shall effect delivery of such Securities by causing
the Direct Participant to transfer the Participant's interest in the Securities, on DTC's records, to the
[TenderlRemarketing] Agent. The requirement for physical deJivery of Securities in connection with a
demand for purchase or a mandatory purchase will be deemed satisfied when the ownership rights in
the Securities are transferred by Direct Participants on DTCs records.] .
10. DTC may discontinue providing its services as securities depositoxy with respect to the Securities
at any time by giving reasonable notice to the Issuer or the Agent. Under such ciIcumstances, in the
event that a successor securities depository is not obtained., Security certificates are required to be
printed and delivered.
11. The Issuer may decide to discontinue use of the system of book-entJy transfers through DTC (or
a successor securities depository). In that event, Security certificates will be printed and delivered.
l2. The information in this section concerning DTC and DTCs book-entry system has been obtained
from sources that the Issuer believes to be reliable, but the Issuer takes no responsibility for the
accuracy thereof.