Loading...
HomeMy WebLinkAboutResolution 2666 Authorizing sale of notes for COP - was MCAP: 8-04-87 > 1 ","' l -I . CERTIFICATION OF MINUTES RELATING TO RESOLUTION AUTHORIZING THE ISSUANCE AND SALE TAX AND REVENUE ANTICIPATION NOTES, SERIES 1987 TO THE BOARD OF INVESTMENTS, FIXING THE FORM AND TERMS THEREOF AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS RELATED THERETO Issuer: City of Bozeman Kind, date, time and place of meeting: A regular meeting held Auqust 3 , 1987, at 2:00 R.m. , at Municipal Buildinq, 411 East Main Street, Bozeman, Montana . Members present: Mayor Mathre, Commissioner Jordan, Commissioner Stiff, Commissioner Martel and Commissioner Vant Hull Members absent: None Documents attached: Minutes of said meeting (pages): RESOLUTION NO. 2666 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE TAX AND REVENUE ANTICIPATION NOTES, SERIES 1987 TO THE BOARD OF INVESTMENTS, FIXING THE FORM AND TERMS THEREOF AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS RELATED THERETO I, the undersigned, being the duly qualified and acting recording officer of the public body issuing the obligations 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 public body 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 obligations; 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. WITNESS my hand officially as such recording officer this 4th day of ~~st , 1987. @~ d Jt!I~, Clerk of the Commission (SEAL) .~ ..-...---- .--.----.------.-. -.--.... -------- - --~--_.- ~ . Member Martel introduced and moved the adoption of the following resolution: RESOLUTION NO. 2666 RESOLUTION AUTHORIZING THE ISSUANCE AND SALE TAX AND REVENUE ANTICIPATION NOTES, SERIES 1987 TO THE BOARD OF INVESTMENTS, FIXING THE FORM AND TERMS THEREOF AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS RELATED THERETO RECITALS WHEREAS, the City of Bozeman , Montana (the "Local Government") is authorized pursuant to Title 7, Chapter 6, Part 11, Montana Code Annotated (the Local Government Act) to issue its short-term obligations in anticipation of taxes or revenues budgeted to be received and appropriated for expenditure during the fiscal year in which the obligations are issued and the proceeds o[ which are to be used solely for the purpose for which the taxes or revenues were appropriated and for costs and expenses incident thereto ("Tax and Revenue Anticipation Note or Notes"); and WHEREAS, The Board of Investments of the State of Montana (the "Board") is authorized pursuant to Title 17, Chapter 5, Part 16, Montana Code Annotated (the "Board Act") to purchase from cities, towns, counties, consolidated city-counties and school districts (Local Governments) notes, including Tax and Revenue Anticipation Notes in order to reduce the costs of public borrowing; and WHEREAS, to accomplish the purposes set forth above, the Board has developed a borrowing program (the "Program") whereby participating Local Governments, by simultaneously issuing their Tax and Revenue Anticipation Notes, may alleviate cash flow difficulties and reduce the interest and issuance costs of the Local Governments below what could be achieved if the Tax and Revenue Anticipation Notes were issued separately; and WHEREAS, it is in the best interests of the Local Government to participate in the Program by the issuance of its Tax and Revenue Anticipation Note (hereafter the "Note"); and ...on... __.___.". . - , WHEREAS, the Program contemplates that the Notes be issued and sold to the Board whereupon the Board will sell and assign its interest in the Notes to First Trust Company of Montana, in Billings, Montana (the "Trustee") as Trustee under an Indenture of Trust (the "Indenture") entered into among the Board, the Trustee and all Local Governments participating in the Program and that the Trustee is authorized to execute and deliver Certificates of Participation (the "Certificates") in the Notes and the Tax and Revenue Anticipation Notes of the other participating Local Governments and further authorizes the Trustee to cause such Certificates to be sold; and WHEREAS, the proceeds of the sale of the Notes will be used by the Local Governments to offset cash flow shortages during the current fiscal year; and WHEREAS, the Board has agreed to enter into a Contingent Purchase Agreement with the Trustee pursuant to which the Board will agree that if a Local Government is unable to pay the principal and interest on its Note on the Maturity Date, the Board will purchase a Renewal Note of such Local Government to enable the Trustee to pay the principal and interest on the Certificates at Maturity; NOW THEREFORE, BE IT RESOLVED, by the Governing Body of the Local Government as follows: ARTICLE I. DEFINITIONS 1.01. As used in this resolution, each of the terms listed below is defined as follows: "Advance" means the periodic disbursements by the Trustee of the proceeds of the Notes pursuant to the terms of the Resolution and the Indenture. "Authorized Representatives" means the officers of the Local Government designated by the Governing Body and set forth on Exhibit B hereto, to act on behalf of each Local Government by written certificate furnished to the Trustee, containing the specimen signature of such persons and signed on behalf of the Local Government by the Mayor or the City Manager, in the case of a city or town; the Chairman of Board of County Commissioners, in the case of a county; the Chief Executive in the case of a consolidated city-county; or the Chairman of the Board of Trustees, in the case of a school district. -2- '. . "Capitalized Interest" shall mean, with respect to each Local Government, its proportionate share of the amount initially deposited by the Trustee in the Capitalized Interest Account, which amount shall be sufficient together with interest earnings thereon to pay all interest due or to become due on such Local Government's Notes at Maturity. "Capitalized Interest Account" means the account established within the Debt Service Fund in Section 4.06 of the Indenture. "Contingent Purchase Agreement" means the agreement dated as of August 20, 1987 between the Board as Contingent Purchaser and the Trustee, regarding the obligation of the Contingent Purchaser to purchase the Renewal Note. "Contingent Purchase Fee" means the fee paid to the Board pursuant to the Contingent Purchase Agreement. "Contingent Purchaser" means the Board. "Cost of Issuance" means costs of issuance relating to the Notes and Certificates, including, but not limited to, the Board's Program Fee and its expenses, Contingent Purchase Fee, all printing expenses in connection with this Indenture of Trust, Notes, Note Resolutions, Contingent Purchase Agreement, Underwriter's Discount, the preliminary and final Official Statement for such Certificates, and such Certificates, the legal fees and expenses of counsel to the Contingent Purchaser, the Underwriters and Bond Counsel, any accounting expenses incurred in connection with determining that such Certificates are not arbitrage Certificates, and the Trustee's initial fee for such Certificates. "Governing Body" means in the case of a city or town, the city or town councilor commission; in the case of a county, the board of county commissioners; in the case of a school district, the board of trustees; and in the case of a consolidated city-county, the commission. "Investment Rate" means the rate of interest at which funds are invested pursuant to the Master Investment Agreement and the Local Government Investment Agreement. "Local Government Account" means the account created for each Local Government with the Proceeds Fund pursuant to Section 4.02 of the Indenture. -3- " . "Local Government Investment Agreement" means the agreement between the Local Governments and the Board regarding the investment of the proceeds of the Local Governments' Notes. "Local Governments" means cities, towns, counties, consolidated city-counties, school districts or high school districts organized and existing under the laws of the State of Montana and participating in the Program; the term Local Government means, unless the context indicates otherwise, the Local Government that adopts this Resolution. "Master Investment Agreement" means the Agreement entered into by the Trustee, the Board and the Qualified Institution providing for the investment of funds held by the Trustee. "Maturity Date" means the maturity date of the Notes and the Certificates. "Note" or "Notes" means the tax and revenue anticipation notes issued by the Local Government in anticipation of taxes and revenues to be received and appropriated for expenditure during the fiscal year ending June 30, 1988. "Purchase Date" means the date the Contingent Purchaser is obligated to purchase the Renewal Note pursuant to the Contingent Purchase Agreement, which date is also the Maturity Date of the Notes and Certificates. "Qualified Institution" means a qualified institution as defined in the Indenture. "Renewal Note" means the renewal note issued by the Local Government upon the terms and conditions described in Sections 3.04 and 3.17 hereof. Capitalized terms used herein but not defined shall have the meanings set forth in the Indenture. 1. 02. Exhibits. The following are exhibits to and a part of this Resolution: Exhibit A: Maximum Anticipated Cumulative Cash Flow Deficit Exhibit B: Certificate of Authorized Representatives. -4- . ARTICLE II. THE PROGRAM 2.01. Participation in the Proqram. The Governing Body finds that it is desirable and expedient to participate in the Program and to issue and sell simultaneously with other Local Governments its Notes to the Board and to authorize the Board to assign and sell to the Trustee its Notes and to authorize the Trustee to execute and deliver Certificates of Participation evidencing proportionate ownership interest in payments of principal and interest to be made by the Local Government in connection with the Notes. Subject to the provisions of Section 3.8 hereof, the Notes shall at all times be registered in the name of the Trustee and held by the Trustee for the benefit of the holders of the Certificates. 2.02. Form of Documents. The Governing Body hereby approves the form of the Indenture, the Contingent Purchase Agreement, and the Local Government Investment Agreement. The Indenture of Trust and the Local Government Investment Agreement shall be executed in the name and on behalf of the Local Government by two of the Authorized Representatives, who are designated in Exhibit B hereto, and the Contingent Purchase shall be signed by the Board. All such instruments shall be in substantially the form on file, but with all such changes therein, not inconsistent with law and which will not have a material adverse affect on the Local Government, as may be approved by the Authorized Representatives executing the Indenture and the Local Government Investment Agreements, which approval shall be conclusively evidenced by the execution thereof. 2.03. Approval of Sale of Notes and Appointment of Trustee. The Governing Body hereby approves the sale of the Notes to the Board, the sale and assignment of the Notes to the Trustee subject to the provisions of Section 3.02 hereof, the appointment of First Trust Company of Montana as trustee under the Indenture of Trust, as the paying agent and registrar for the Certificates, as the authenticating agent, paying agent and registrar for the Notes, and as agent for the Local Government for the purposes of entering into agreements for the sale of the Certificates and participation in the preparation of any Official Statements relating to the Certificates. -5- .-..---...--.--.-..--.--- ------..-... .. ARTICLE III. THE NOTES 3.0l. Authorization of Notes. Subject to the conditions of Section 3.02 hereof, there is hereby authorized to be issued and sold to the Board the Notes of the Local Government in the aggregate principal amount not to exceed the sum of (i) the Maximum Anticipated Cumulative Cash Flow Deficit of the Local Government as shown in Exhibit A, less investment earnings which are anticipated to accrue in the Local Government's Account pending Advances, (ii) an amount equal to the Capitalized Interest, and (iii) the Local Government's proportionate share of the Costs of Issuance, rounded down to the nearest $5,000 (the Series 1987 Notes), all as approved by the Authorized Representatives. If the interest rate on the Notes exceeds 5.625% and the Costs of Issuance to be paid by the Local Governments exceeds 2% of the Maximum Anticipated Cumulative Cash Flow Deficit shown on Exhibit A hereto, the issuance of such Notes shall not be authorized. The Board shall notify the Local Government of the precise principal amount of the Notes and the interest rate thereon upon the sale of the Certificates as provided in Section 3.02 hereof. The Authorized Representatives are hereby directed to prepare the Notes in the designated principal amount and at the designated interest rate and to execute, certify and return the executed Note to the Board. 3.02. Terms of the Notes. The Notes shall be in the aggregate principal amount determined as provided in Section 3.01 hereof, shall be issued initially as one in number, shall be dated as of the date of delivery to the Trustee, shall mature on September 20, 1988 (the Maturity Date), and shall bear interest at a rate designated by the Board, which rate shall not exceed 5.625% per annum, which shall be payable on the Maturity Date without option of prior payment. In order to provide for the security and marketability of the Notes and Certificates, the Local Government shall credit and deposit in its Local Government Account its Net Amount due under the Note under Section 5.02 of the Indenture on or before June 30, 1988i provided, howeve r , that such credit and deposit shall not relieve the Local Government of its obligation to pay principal of, and interest on its Note on the Maturity Date. The Notes of this series shall be numbered from R-I upwards, shall initially be issued in integral multiples of $5,000, and may subsequently be issued in any denomination or denominations to represent the percentage -6- ~ ..- "",... interest of a Certificate Owner, if the Certificate Owner wishes to exchange his Certificates for Notes, pursuant to Section .2.06 of the Indenture of Trust. The principal amount of the Notes shall be reduced if and to the extent necessary to obtain an approving legal opinion of bond counsel as to the legality thereof and the tax exempt status of interest thereon and if and to the extent necessary to comply with Section 148(f)(4)(B)(iii) or Section 148(f)(4)(C) of the Internal Revenue Code of 1986. 3.03. Purpose of Notes. The Notes are issued in anticipation of taxes and revenues budgeted to be received and appropriated for expenditures during the fiscal year ending June 30, 1988 as set forth on Exhibit A hereto. 3.04. Amount of Notes Not to Exceed. The maximum principal amount of the Notes set forth in Section 3.1 hereof does not exceed the Maximum Anticipated Cumulative Cash Flow Deficit for the Local Government as computed in accordance with Section 1.103-14(c) of the Treasury Regulations applicable under the Internal Revenue Code of 1986, as amended (the "Maximum Anticipated Cumulative Cash Flow Deficit"), less investment earnings which are anticipated to accrue in the Local Government's Account pending Advances, plus the Local Government's Capitalized Interest and the Local Government's proportionate share of Costs of Issuance. 3.05. Form of Notes. The Notes, the form of certification by the authenticating agent and the provisions for assignment of the Notes shall be, respectively, in substantially the following form (the text of which may be typewritten or printed on the face, or on the back, or partly on the face and partly on the back): -7- ------- -- --- -.-.--....----.- . Form of Notes UNITED STATES OF AMERICA STATE OF MONTANA NAME OF CITY, TOWN, COUNTY (CONSOLIDATED CITY-COUNTY) OR SCHOOL DISTRICT No. TAX AND REVENUE ANTICIPATION NOTE SERIES 1987 Interest Maturity Date of Rate ~ OriGinal Issue REGISTERED OWNER: PRINCIPAL AMOUNT: The Local Government named above (the "Local Government"), a political subdivision of the State of Montana, acknowledges itself to be indebted and for value received promises to pay to the registered owner specified above, or registered assigns, without option of prior payment, the principal sum specified above, on the maturity date specified above, and to pay interest thereon from the Date of Original Issue specified above until the principal amount is paid at the interest rate specified above, interest to be due and payable on the maturity date specified above. The principal of this Note is payable upon presentation and surrender hereof at the office of First Trust Company of Montana, Billings, Montana, as Note Registrar, in any coin or currency of the United States of America which at the time of payment is legal tender for public and private debts. The interest on this Note is payable by check or draft mailed to the registered holder in whose name this Note is at the time registered at the address as it appears on the bond register maintained by the Note Registrar. Interest on this Note shall be calculated -8- -- / ./.... on the basis of a 360 day year containing 12 thirty day months. This Note is one of a duly authorized series in the aggregate principal amount listed above (the "Notes"), all of like tenor and effect except as to serial number and denomination, issued under the authority and in full compliance with the provisions of the Constitution and laws of the State of Montana, particularly Title 7, Chapter 6, Part 11, Montana Code Annotated (the "Act") and pursuant to a resolution duly adopted by the governing body of the Local Government (the "Resolution"). The Note is issued in anticipation of taxes and revenues budgeted to be received and appropriated for expenditures during the fiscal year ending June 30, 1988. This Note shall constitute a general obligation of the Local Government and the pledge made in the Resolution is for the equal benefit, protection and security of the Holder hereof. Reference is hereby made to the Resolution for a description of the obligations and duties of the Local Government. The Trustee has been provided with a certified copy of the Resolution. In the event the principal of and interest on this Note is not paid on the Maturity Date, the obligations hereunder shall continue as hereinafter described and this Note shall be renewed as of such date upon the terms and conditions contained or referenced -in this paragraph and shall constitute the Renewal Note. The principal amount of the Renewal Note shall be an amount equal to the principal amount of the Note, and the obligation thereunder shall include the payment of all accrued interest thereon. The Renewal Note shall be dated as of the date of the Note, shall mature December 30, 1988, and shall bear interest until September 20, 1988 at the rate set forth above. From and after September 20, 1988, the Renewal Note shall bear interest at a rate equal to the yield on 52 week Treasury Bills as reported in the Wall Street Journal on the day preceding the Purchase Date, plus 2% per annum. The Note shall be exchanged for the Renewal Note which shall be issued in substantially the form of the Note with such changes therein as required hereby, to the registered owner and until the Renewal Note is issued this Note shall constitute the Renewal Note. All references hereafter to the Note or Notes shall include the Renewal Note or Notes and all obligations and covenants of the Local Government set forth in the Resolution shall extend to the Renewal Note and the Renewal Note shall be secured thereby and entitled to the benefits thereunder. -9- ------.. .--. . .- signatures of its authorized officers, all as of the Date of Original Issue specified above. Authenticating Agent's Certificate This is the Note described in the within mentioned Resolution. Date of Authentication: FIRST TRUST COMPANY OF MONTANA Authenticating Agent By Authorized Signature ASSIGNMENT For Value Received, the undersigned hereby sells, assigns and transfers unto (Please Print or Typewrite Name and Address of Assignee.) the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints attorney to transfer the within Note on the books kept for the registration thereof, with full power of substitution in the premises. Dated: -11- - ...--- . ~- PLEASE INSERT SOCIAL SECURITY NOTICE: THE SIGNATURE TO NUMBER OR OTHER IDENTIFYING THIS ASSIGNMENT MUST CORRESPOND WITH THE FACE AS IT APPEARS UPON THE FACE OF THIS NOTE IN EVERY PARTICULAR, WITHOUT ALTERNATION OR ANY CHANGES WHATSOEVER. Signature Guaranteed by: End of Form of Note 3.06. Payment of Principal and Interest. The principal of said Notes shall be payable at the office of First Trust Company of Montana (the "Note Registrar") and interest on said Note shall be mailed to the registered holders thereof at the addresses as they appear on the Note register maintained by the Note Registrar; and the Local Government shall pay the reasonable charges of said bank for its services as authenticating agent, transfer agent, paying agent and registrar. 3.07. Preparation of Notes. The Notes shall be prepared under the direction of the Authorized Representatives of the Local Government, and when so prepared shall be executed on behalf of the Local Government by the Authorized Representative and by the authorized signature of the Note Registrar. The Notes shall originally be registered in the name of the Trustee and prepared in typewritten form. When the Notes shall have been so prepared and executed, they shall be delivered to the Trustee. 3.08. Reqistration. As long as the Note issued hereunder shall remain outstanding, the Local Government shall maintain and keep at the office of the Note Registrar an office or agency for the paYment of the principal of and interest on such Note, as in this Resolution provided, and for the registration and transfer of such Note, and shall also keep at said office of the Note Registrar books for such registration and transfer. Upon surrender for transfer of any Note at the office of the Note Registrar with a written instrument of transfer satisfactory to the -12- .-... -- .--.-.--..-..-.. - -.---.--- .-.--.----- ...-.-....---..--.----. ~ Note Registrar, duly executed by the registered owner or his duly authorized attorney, and upon payment of any tax, fee or other governmental charge required to be paid with respect to such transfer, the Local Government shall execute and the Note Registrar shall authenticate and deliver, in the name of the designated transferee or transferees, one or more fully registered Note of the same series, of any authorized denomination. In all cases in which the privilege of exchanging Notes or transferring fully registered Notes is exercised, the Local Government shall execute and the Note Registrar shall authenticate and deliver, in the name of the designated transferee or transferees, one or more fully registered Notes of the same series, of any authorized denominations and of a like aggregate principal amount. The Notes, upon surrender thereof at the office of the Note Registrar may, at the option of the registered owner thereof, be exchanged for an equal aggregate principal amount of Notes of the same series of any authorized denotations. In all cases in which the privilege of exchanging Notes or transferring fully registered Notes is exercised, the Local Government shall execute and the Note Registrar shall deliver Notes in accordance with the provisions of this Resolution. For every such exchange or transfer of Notes, the Local Government or the Note Registrar may make a charge sufficient to reimburse it for any tax, fee or other governmental charge required to be paid by the person requesting such exchange or transfer, which sum or sums shall be paid by the person requesting such exchange or transfer as a condition precedent to the exercise of the privilege of making such exchange or transfer. 3.09. Exchanqe of Certificates for Notes. The Certificates, upon surrender thereof at the office of the Note Registrar may, at the option of the registered owner thereof, be exchanged for Notes of the series relating thereto in an aggregate principal amount equal to the percentage interest held by the registered owner of the Certificates in the Notes as indicated on such Certificates. The Local Government shall execute and the Note Registrar shall deliver (a) one Note in the name of the registered owner of the Certificates requesting the exchange and (b) one Note in the name of the Trustee in the aggregate principal amount equal to the balance of the Notes held by the Trustee and represented by outstanding Certificates, of the same series and of any authorized denomination. Notwithstanding any other provisions of this Resolution, the cost of preparing new Notes upon each exchange requested by a registered owner of a Certificate, and any other expenses of the Local Government or the Note -13- ........-...... .----. . Registrar or Trustee incurred in connection therewith (including fees of bond counselor other legal counsel, any applicable tax or other governmental charge) shall be paid by the registered owner of the Certificate requesting the exchange as a condition precedent to the exercise of the privilege of making such exchange. 3.10. Payment of Interest. Interest on any Note which is payable, and is punctually paid or duly provided for, on the Maturity Date shall be paid to the person in whose name that Note (or one or more Notes for which such Note was exchanged) is at the time registered. Each Note delivered under this Resolution upon transfer of or in exchange for or in lieu of any other Note shall carryall the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note and each such Note shall bear interest from such date that neither gain nor loss in interest shall result from such transfer, exchange or substitution. 3.11. Reqistered Owner. As to any Note, the Local Government and the Note Registrar and their respective successors, each in its discretion, may deem and treat the person in whose name the same for the time being shall be registered as the absolute owner thereof for all purposes and neither the Local Government nor the Note Registrar nor their respective successors shall be affected by any notice to the contrary. Payment of or on account of the principal of any Note shall be made only to or upon the order of the registered owner thereof, but such registration may be changed as above provided. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Note to the extent of the sum or sums so paid. 3.12. Use and Disbursement of the proceeds. The proceeds of the Note will be expended solely for the purposes for which the taxes or revenues were appropriated and for costs and expenses incident to the issuance and sale thereof. The proceeds from the sale of the Notes deposited in the Local Government's Account shall remain in the Local Government's Account pending disbursement at the request of the Local Government to pay the budgeted expenditures in anticipation of which the Notes were issued. Proceeds of the Notes held in the Local Government's Account shall be invested as described in Section 3.16 hereof and shall secure the Local Government's obligations hereunder and under the Indenture. Requests for disbursement shall be made in writing to the Trustee on a form approved by the Trustee. Requests for disbursement -14- -.------.---.--- .. ---." ,... ..........,... _ . -- _ ..- _ .--.... -- --......--.-......-.- -..--.-------------- -.-----.-.-.---...- . shall be delivered to the Trustee on or before the Monday of the week in which the Issuer wishes to receive funds (or the next. following Business Day) and the Trustee shall advance the funds on the next succeeding Wednesday (or the next following Business Day). The Trustee may alter the schedule for disbursements upon notice to the Local Government, if necessary. 3.13. Surplus Funds. Whenever there are sufficient moneys available in the fund or funds for which the Local Government has borrowed to pay the Local Government's current month's expenses payable from such fund, plus a reasonable carryover amount not to exceed the amount designated in the Local Government's budget for disbursement and expenses during the next month, any surplus moneys shall be paid to the Trustee for deposit in the Local Government Account created in the Indenture, if and to the extent the Local Government has any outstanding Advances from such Local Government Account. Payment of surplus funds shall be made no more often than weekly on Wednesday, or if a Wednesday is not a Business, on the next succeeding Business Day, upon written notice to the Trustee delivered no later than Monday of the week in which the surplus funds are to be paid. The Trustee may alter the schedule for repayment upon notice to the Local Government, if necessary. 3.14. Investment of Note Proceeds. Pursuant to the Local Government Investment Agreement, the terms of which are hereby approved, the Trustee shall invest the proceeds of the Note with the Board of Investment in its short term investment program (STIP) in a separate STIP fund designated as the STIP - Local Government Tax and Revenue Anticipation Note Fund (the "Fund"). The Board is hereby authorized to enter into the Master Investment Agreement with a Qualified Institution providing for the investment of the Fund. The rate of interest to be borne by the Fund shall be the Investment Rate, provided that interest earnings on the Local Government Accounts and the Capitalized Interest Account invested in the Fund will be credited with interest earnings as received under the Master Investment Agreement, 3.15. Funds in Trust. All moneys held by the Trustee with respect to any Fund created under the Indenture of Trust shall, until advanced to the Local Governments as provided in Section 4.04 of the Indenture of Trust, be held in trust for the Registered Owners of the Certificates and Notes and shall not be subject to any lien or attachment in any funds, sub-funds, accounts or -15- ----..--.----..-------.....-...-.-.--..--.-.------.--.--..--- . . sub-accounts, and shall be invested as provided in Section 6.01 of the Indenture of Trust. 3.16. Security for the Notes. As security for the payment of the principal and interest on the Notes and the performance of the covenants contained in this Resolution and the Indenture, the Local Government hereby pledges and assigns all of its right, title and interest and grants a security interest to the Trustee for the benefit of the Registered Owners of the Certificates and the Notes, in and to the proceeds of taxes and revenues budgeted to be received and appropriated for expenditure during the fiscal year ending June 30, 1988 and any other moneys available thereafter, except as limited below, and to all moneys and investments held in the corresponding Funds and Accounts created under the Indenture, and the proceeds of each of the above. The Note shall constitute a general obligation of the Local Government and the principal of and interest on the Note shall be payable from the money derived from the taxes and revenues in anticipation of which they were issued, income from investment of the proceeds of the Note, and any money and funds of the Issuer otherwise legally available therefor. The Local Government shall enforce its rights to receive and collect all such taxes and revenues to insure the prompt payment of the Issuer obligations hereunder. If a Local Government has not paid the Net Amount and any other additional amounts due thereunder as specified in Section 5.07 of the Indenture by July 15, 1988, the Local Government covenants to budget, appropriate and levy taxes in the then current fiscal year in an amount sufficient when combined with other moneys available therefor to repay the principal of and interest on the Renewal Note by December 30, 1988. ARTICLE IV. THE RENEWAL NOTES 4.01. Terms of the Renewal Note. In the event there is insufficient money available in the Local Government Account as provided in Section 5.03 of the Indenture to pay the principal of and interest on the Note on its Maturity Date, the Note by the terms hereof shall become the Renewal Note. The principal amount of the Renewal Note shall be an amount equal to the principal amount of the Note, and the obligation thereunder shall include the payment of all accrued interest thereon. The Renewal Note shall be dated as of the date of the Note, shall mature on December 30, 1988, and shall bear interest -16- . . from its dated date to September 20, 1988 at the rate set forth on the Note in accordance with Section 3.02 hereof. From and after September 20, 1988, the Note shall bear interest at a rate equal to the yield on 52 week Treasury Bills as reported in the Wall Street Journal on the day preceding the Purchase Date, plus 2% per annum. The provisions, representations, covenants and obligations contained in this Resolution relating to the Notes shall also apply to the Renewal Note unless otherwise provided or unless by their terms such provisions, representations, covenants and obligations are inconsistent with the stated terms of the Renewal Notes. The Renewal Note shall be prepayable, in whole or in part, at any time without prepayment penalty. 4.02. Purchase of the Renewal Note. Pursuant to the Contingent Purchase Agreement, the terms of which are hereby approved, if there are not sufficient moneys on deposit in a Local Government Account three days prior to the Maturity Date to pay principal and interest on the Local Government's Notes at the Maturity Date, pursuant to Section 5.03 of the Indenture, the Local Government recognizes and agrees, for the benefit of the holders of the Notes and the Certificates relating to such Local Government's Notes, that the Board shall purchase the Renewal Note from the Trustee, and the Trustee shall deposit the proceeds from the sale thereof to the Local Government.s Account for transfer to the Debt Service Fund under the Indenture. Upon the purchase of the Renewal Note by the Board, the Trustee shall transfer to the Board all funds held for or on behalf of such Local Government under the Indenture. Any funds received by the Board from the Trustee shall be first applied to the payment of accrued interest on the Note and then to reduce the principal amount of the Renewal Note. The Board shall be entitled to enforce all of the covenants and obligations of the Local Government under the Note and Note Resolution and the Local Government hereby covenants that all obligations of the Local Government under the Note and Note Resolution shall extend to the Renewal Note, unless inconsistent with the terms of the Renewal Note. 4.03 Authorization of Renewal Note. Subject to the terms and conditions set forth in Sections 4.01 and 4.02 hereof, the Trustee is authorized to execute and deliver to the Contingent Purchaser, a Renewal Note on behalf of the Local Government in substantially the form set forth at Section 3.08 with such changes as may be required to effectuate the terms of the Renewal Note, upon the payment and application of the Purchase Price -17- . , therefor. The Trustee is authorized to print on the Renewal Note the facsimile signatures of the Authorized Representatives previously provided to it. In case any officer whose signature, or a facsimile of whose signature, has been delivered to the Trustee shall cease to be such officer before the delivery of the Renewal Note, such signature or facsimile signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery. Section 4.04. provisions of Note and Note Resolution Applicable to Renewal Notes. All obligations and covenants of the Local Government set forth herein and in the Note shall extend to the Renewal Note, and the Renewal Note shall be secured hereby and thereby and entitled to the benefits hereunder and thereunder. ARTICLE V. THE CERTIFICATES 5.01. Execution of Certificates. The Trustee is authorized and directed to execute and deliver the Certificates on the Local Government's behalf, pursuant to the terms of the Indenture of Trust, in the aggregate principal amount specified in the Indenture of Trust and substantially in the form and otherwise containing the provisions set forth in the form of the Certificate contained in the Indenture of Trust, which terms and provisions are hereby approved and incorporated in this Resolution and made a part hereof. 5.02. Deliverv. The Certificates shall be executed by the Trustee in accordance with the Indenture of Trust. When so prepared and executed, the Certificates shall be delivered to the purchasers thereof upon payment of the purchase price thereof, pursuant to the terms of the Indenture of Trust. ARTICLE VI. MISCELLANEOUS 6.01. Proceedinas. The officers of the Local Government are hereby authorized and directed to prepare and furnish to the Trustee and the purchasers of the Certificates, certified copies of all proceedings and records of the Local Government relating to the power and authority of the Local Government to issue its Notes and -18- -...- .-.------ ----.------..... . , to execute and deliver the Indenture of Trust, the Investment Agreement, and certificates as to matters within their knowledge or as shown by the books and records under their custody and control, including a general and non-litigation certificate, and such certified copies and certificates shall be deemed representations of the Local Government as to the facts stated therein. 6.02. Certification of Resolution. The Authorized Representative is hereby authorized and directed to certify a copy of this Resolution and to obtain a certificate as to registration of the Notes. 6.03. Report. The officers of the Local Government are hereby authorized and directed to prepare and submit to the Secretary of the Treasury a statement meeting the information reporting requirements of Section l49(e) of the Code by the 15th day of the second calendar month after the close of the calendar quarter in which the Notes are issued. 6.04. Approval of Official Statement. The Local Government hereby authorizes the preparation and distribution of a Preliminary Official Statement and an Official Statement relating to the Certificates and authorizes the Authorized Representatives to certify as to the accuracy of the information therein relating to the Local Government. 6.05. Arbitraae Rebate. The Governing Body finds that either (a) the exception for small governmental units available under Section l48(f)(4)(C) of the Code is applicable to the Notes because (i) the Local Government has general taxing powers, (ii) the Notes are not private activity bonds under Section l41(a) of the Code, (iii) ninety-five percent or more of the net proceeds of the Notes are to be used for local governmental activities of the Local Government and (iv) the aggregate face amount of all tax-exempt bonds (other than private activity bonds) which will be issued by the Local Government during the current calendar year is not reasonably expected to exceed $5,000,000 or (b) within 6 months of the date of issuance of the Notes the cumulative cash flow deficit as defined in Section 148(f)(4)(B)(iii) of the Local Government will not exceed 90% of the aggregate face amount of the Notes. By:fii~1~l'l 01" ~ Title: Maar -19- ~-''''-I'I'", . __ ..__..__......___n__....__ ______.., ___... . ~ Attest: at dJ1 o .... {~ By: ~. ~.,{JJdJ<h./ Title: Clerk of the Commission Member Vant Hull seconded the motion and the following members voted in favor of thereof: Commissioner Martel. Commissioner Vant Hull, Commissioner Jordan, Commissioner stiff and Mavor Mathre the following members voted against the same: None -'~''''!''~I' I " ,",', ,,:.' .'" ,,'. '. '.~. I"J't'.. .i [:i\,'m~~ f '. .' . ............... ......... ,_ .... of Tp .... ........ Anlle".llIn, ............,. ....' .ffi~luit of lubJicltion -'~-_. .. ,_ " ,": ,. .1 ,r, "~'~' ,I . stale Of MQb ";Y:"~~':I C@y'ofGillflifiri' ",'.f'r: ,.1, AN A } 1,'Robl(1 L, SuKfWln, Clerk of STATE OF MONT =, the City . COmmiSSiOn of the County of Gallatin ss, City. Of Bozeman., Man.tane, do , hereby certify .thet the foregoo , ing is thl! Jrueand correct title Vivie Portnell , bemg duly sworn, and n~niber of Commission ResolutIon No, 2666 passed deposes and says' That..a.he is Princinal cl p.rk andadc;rpfed at a regular . session th(lf89fhelc1 on the 3rd D . 1 C ' I f I. I . day of AugllBt, j987. , of the Bozeman a 1 Y hromc e, a newspaper 0 genera Clrcu atIon, Dated '.Ibi$ 10lh<lay of Au- printed and published ;n Bozeman, Gallatin County, Montana; and that the ~~~~ notice hereunto annexed ( Resolution No. 2666-~~- .""" ) , has been correctly published in the regular and entire issue of every number of said paper for-1- eonseettti~ in!'H~rt;nn day of AU2ust 19 ~,and the last on the 87 Subscribed and sworn to before me th;s 18th day of 4st c 19 87 ~Aj 6~ Notary Public for the State of Montana, residing at I Bozeman, Montana , Iv,,' 'Y,y PU8L1C.for the state 01 Montana Residing at Bozeman, Montana My Commission expires July 6, 1Q90 -_..".."~~'"._- -..---------- ._._~ \ . , , Exhibit B Certificate of Authorized Representative The following officers of the City of Bozeman, Montana (Name of Local Government Unit) are authorized to act on behalf of the Local Government with respect to the issuance, sale, disbursement, and repayment of its Tax and Revenue Anticipation Note - Series 1987. Name Title ~anature ~ James E. Wysocki C~ty Manager ...~. . Miral D. Gamradt :::~kS:~~O:~. ~:t.- :;l~ Robin L. Sullivan Dated this 3rd day of Auqust , 1987. B ~f)~ Y Its ayor (To be signed by the Mayor or City Manager in the case of a City, the Chairman of the Board of County Commissioners, in the case of a County, the Chief Executive in the case of a City-County, or the Chairman of the Board of Trustees in the case of a School District.) -21-