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HomeMy WebLinkAboutResolution 3566 $1,685,000 General Obligation Bonds, series 2003A, Library RESOLUTION NO. 3566 RESOLUTION RELATING TO $1,685,000 GENERAL OBLIGATION BONDS, SERIES 2003A; AUTHORIZING THE ISSUANCE AND CALLING FOR THE PUBLIC SALE THEREOF BE IT RESOLVED by the City Commission (the "Commission") ofthe City of Bozeman, Montana (the "City"), as follows: Section 1. Recitals. The electors of the City at an election duly called, noticed and held on June 28,2001, at which 6,403 of the 15,666 registered electors voted (41 % of the registered electors voted), by a vote of 4,205 in favor, and 2,198 opposed (66% of the votes cast were in favor), authorized this Commission to issue and sell general obligation bonds of the City in the principal amount of $4,000,000 for the purpose of acquiring land for and designing, constructing and equipping either a new public library or designing, constructing and equipping an expansion ofthe existing library (the "Project") and paying costs associated with the sale and issuance of the bonds. "). In 2001, the City issued bonds in the amount of $2,315,000 for the Project. The City has determined that it is necessary and desirable and in the best interests of the City to issue the remaining Bonds at this time in the aggregate principal amount of$1,685,000 (the "Bonds"). The indebtedness to be evidenced by the Bonds and all other indebtedness of the City does not exceed the limitation as set forth in Title 7, Chapter 7, Part 4201, M.C.A. The City has full power and authority to issue the Bonds. Section 2. Term of the Bonds. Pursuant to the authority described in Section 1, this Commission hereby authorizes the issuance and sale ofthe Bonds of the City in the aggregate principal amount of$I,685,000 for the purpose of financing the costs of the Projects. The Bonds shall be dated, as originally issued, as of February 1,2003, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1, 2003, at a rate or rates designated by the successful bidder at public sale and approved by this Commission. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of 1 %. The Bonds shall be offered and sold in accordance with the terms and conditions of sale which are set forth on Exhibit A hereto (the "Official Terms and Conditions"), which is incorporated by reference and made a part hereof. The Bonds shall mature, subject to redemption as hereinafter provided, on July 1 in each of the following years and amounts: ____.._.__...._______._____ __., '.._n_ 0___.___....,._..____..____.___ Year Amo unt Year Amount 2004 $ 65,000 2013 $ 95,000 2005 70, 000 2014 100,000 2006 70, 000 2015 95,000 2007 75, 000 2016 105,000 2008 75, 000 2017 110,000 2009 80, 000 2018 115,000 2010 80, 000 2019 120,000 2011 90, 000 2020 120,000 2012 90, 000 2021 130,000 Bonds shall be in the denomination of $5,000 each or any integral multiple thereof of single maturities. The Bonds shall be issuable only as fully registered bonds and shall be executed by the manual or facsimile signatures of the Mayor, City Manager and Clerk of the Commission. At the option of the underwriter, the Bonds shall be issued only in "book entry" form. Section 3. Public Sale. The Bonds shall be sold at a sale on the basis of sealed bids which is hereby called and shall be held at a regular meeting of this Commission on January 13, 2003, at 3:00 P.M., M.T. The City will receive sealed bids for the Bonds in accordance with the Official Terms and Conditions. The Clerk ofthe Commission is hereby authorized and directed to cause notice of the sale to be published, as required by Montana Code Annotated, Sections 7- 7-4252 and 17-5-106, in the Bozeman Daily Chronicle, Bozeman, Montana, once each week for two successive weeks preceding the week which contains the date of sale. The notice of sale shall be published in substantially the form set forth as Exhibit B to this resolution, which is hereby incorporated herein and made a part hereof. Section 4. Official Statement. The Clerk of the Commission and other officers of the City, in cooperation with Springsted Incorporated, of St. Paul, Minnesota, financial consultants to the City, are hereby authorized and directed to prepare on behalf of the City an official statement to be distributed to potential purchasers of the Bonds. Such official statement shall contain the Official Terms and Conditions and such other information as shall be advisable and necessary to describe accurately the City and the security for, and terms and conditions of, the Bonds. Section 5. Continuing Disclosure. In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph (b)(5) of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 (the "Rule"), the City will covenant and agree, for the benefit of the registered holders and beneficial owners from time to time of the outstanding Bonds, in the resolution prescribing the terms of the Bonds to provide annual reports of specified information and notice of the occurrence of certain events, if material. The City is the only "obligated person" in respect of the Bonds within the meaning of the Rule for the purposes of disclosing information on an ongoing basis. A description of the undertaking is set forth in the Official Statement. Failure of the City to enter into an undertaking substantially similar to that described in the Official Statement would relieve the successful bidder of its obligation to purchase the 2 -.. -...---.."".---... .---..--..---.. _______._.__..._..u__._. ...__.._.__ Bonds. The City has complied in all material respects with any undertaking previously entered into by it under the Rule. Section 6. Proceedings to the Attornev General. The Clerk of the Commission is hereby authorized and directed to furnish a certified copy of all proceedings taken by the City with respect to the issuance of the Bonds to the Attorney General for examination and request a report as to the validity of the Bonds, as required by Montana Code Annotated, Section 7-7-101. PASSED by the City Commission of the City of Bozeman, Montana, this 16th day of December, 2002. ~ ~ *' May r Attest: "-.. -0 ~4~ Clerk of the Goro-mission (SEAL) APPROVED AS TO FORM: 3 EXHffiIT A TERMS AND CONDITIONS OF SALE $1,685,000 General Obligation Bonds, Series 2003A City of Bozeman, Montana NOTICE IS HEREBY GIVEN by the City Commission (the "Commission") of the City of Bozeman, Montana (the "City"), that the City will receive sealed bids for the purchase of general obligation bonds in the office of the Clerk of the Commission in City Hall, at 411 E. Main Street, Bozeman, Montana, in the total principal amount of $1 ,685,000 (the "Bonds"), until 11 :00 A.M., M.T., on January 13, 2003. The bids will be opened and tabulated by the Clerk of the Commission and presented to the City Commission at its regular meeting at 3:00 P.M., M.T., on the same day, in the Commission meeting room, at which time the Commission will consider the bids received, and if a responsive and acceptable bid is received, award sale ofthe Bonds to the responsive bidder whose bid reflects the lowest true interest cost (TIC). THE BONDS The Bonds will bear an original issue date of February 1, 2003, and will bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1, 2003, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) of the immediately preceding month, at a rate or rates designated by the successful bidder at public sale and approved by the Commission. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of 1 %. No supplemental or "B" coupons or additional interest certificates are permitted. All Bonds ofthe same stated maturity must bear interest from date of original issue until paid at a single, uniform rate. Interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months. The Bonds shall mature, subject to redemption as hereinafter provided, on July 1 in each of the following years and amounts: Year Amount Year Amount 2004 $ 65,000 2013 $ 95,000 2005 70,000 2014 100,000 2006 70,000 2015 95,000 2007 75,000 2016 105,000 2008 75,000 2017 110,000 2009 80,000 2018 115,000 2010 80,000 2019 120,000 2011 90,000 2020 120,000 2012 90,000 2021 130,000 Bonds shall be in the denomination of $5,000 each or any integral multiple thereof of single maturities. The Bonds will be issued as fully registered bonds only and shall be executed by the manual or facsimile signatures of the Mayor, City Manager and the Clerk of the Commission. A-I ; The Bonds with stated maturities on or after July 1, 2013 will be subject to redemption on July 1, 2012, and any day thereafter, at the option of the City, in whole or in part, and ifin part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, if no designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date. BOOK ENTRY The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity, through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility ofDTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. PURPOSE AND SECURITY The Bonds will be issued for the purpose of acquiring land for and designing, constructing and equipping either a new public library or designing, constructing and equipping an expansion of the existing library and paying costs associated with the sale and issuance of the Bonds, in accordance with the provisions of Montana Code Annotated, Title 7, Chapter 7, Part 42, as amended. The Bonds will be general obligations of the City to the payment of which the full faith, credit and taxing power of the City will be pledged. Bidders should consult a copy of the Official Statement for a discussion ofthe security for the Bonds and the form of opinion of bond counsel relating to the Bonds. CONTINUING DISCLOSURE In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph (b)(5) of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 (the "Rule"), the City will covenant and agree, for the benefit of the registered holders and beneficial owners from time to time of the outstanding Bonds, in the resolution prescribing the terms of the Bonds to provide annual reports of specified information and notice of the occurrence of certain events, if material. The City is the only "obligated person" in respect of the Bonds within the meaning of the Rule for the purposes of disclosing information on an ongoing basis. A description ofthe undertaking is set forth in the Official Statement. Failure ofthe City to enter into an undertaking substantially similar to that described in the Official Statement would relieve A-2 \ " the successful bidder of its obligation to purchase the Bonds. The City has complied in all material respects with any undertaking previously entered into by it under the Rule. QUALIFIED TAX-EXEMPT OBLIGATIONS The Bonds will be designated by the City as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), and financial institutions described in Section 265(b)(5) ofthe Code may treat the Bonds for purposes of Sections 265(b)(2) and 291 (e)(l)(B) of the Code as if they were acquired on August 7, 1986. BIDDING AND SALE PROCEDURES Submission of Bids. Bids must be on the Official Bid form, a copy of which may be obtained from the Financial Advisor and enclosed in a sealed envelope marked as follows: "Bid for $1,685,000 General Obligation Bonds, Series 2003A, City of Bozeman, Montana" and delivered to the Clerk of the Commission. Each envelope when delivered must indicate on the outside the name and address of the bidder, or in the case of a group of bidders, of the representati ve. Basis of Award. The Bonds will be sold for not less than $1,163,095.00 with accrued interest to the date of delivery, and all bidders must state the lowest rate or rates of interest at which they will purchase the Bonds at par. Bids will be compared on the basis of true interest cost (TIC). The TIC is the effective cost of the Bonds based on bond proceeds received at closing calculated from the dated date of the Bonds. In the event that two or more bids state the lowest true interest cost, the sale of the Bonds will be awarded by lot. The Commission will accept sealed or faxed bids only. The Commission reserves the right to reject any and all bids and to sell the Bonds at private sale and to waive any informality and irregularity in any and all bids. Bidders must bid for all or none of the Bonds. Each bid must be unconditional (or conditioned on only those items specified in these Official Terms and Conditions of Sale). No bid may be altered or withdrawn after the time specified above for opening bids without the express consent of the Commission. Good Faith Deposit. A good faith deposit (the "Deposit") in the form of money, cashier's check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federal Deposit Insurance Corporation or a financial surety bond in the sum of$33,700 payable to the order of the City of Bozeman, Montana is required for each bid to be considered. If money, cashier's check, certified check, bank money order, or bank draft is used, it must accompany each bid and be delivered to the Clerk of the Commission. If a financial surety bond is used, it must be from an insurance company licensed and qualified to issue such a bond in the State of Montana and such bond must be submitted to the Clerk of the Commission, or its financial advisor prior to the opening of the bids. The financial surety bond must identify each bidder whose Deposit is guaranteed by such financial surety bond. If the Bonds are awarded to a bidder utilizing a financial surety bond, then that purchaser is required to submit its Deposit to the City in the form of a cashier's check (or wire transfer such amount as instructed by the City or its financial advisor) not later than 1:00 P.M., M.T., on the next business day following the award. If such Deposit is not received by that A-3 \ " time, the financial surety bond may be drawn by the City to satisfy the Deposit requirement. No interest on the Deposit will accrue to the purchaser. The Deposit will be applied to the purchase price of the Bonds. In the event the purchaser fails to honor its accepted bid, the Deposit will be retained by the City. The Deposit of the unsuccessful bidders will be returned immediately on award of sale of the Bonds or after rejection of all bids. Instructions for wiring a Deposit may be obtained from the City's Financial Advisor, Springsted Incorporated, 85 East 11 th Place, Suite 101, St. Paul, Minnesota 55101, (651) 223- 3000. BOND REGISTRAR, TRANSFER AGENT AND PAYING AGENT The Administrative Services Director of the City will act as bond registrar, transfer agent and paying agent (the "Registrar"). The bond register will be kept, transfers of ownership will be effected and principal of and interest on the Bonds will be paid by the Registrar. The City will pay the charges of the Registrar for such services. The City reserves the right to appoint a suitable bank or trust company as a successor Registrar. LEGAL OPINION An opinion as to the validity of the Bonds and the exclusion from gross income for federal and Montana income tax purposes of the interest thereon will be furnished by Dorsey & Whitney LLP, of Missoula, Montana, and Minneapolis, Minnesota, as Bond Counsel. The legal opinion will be delivered at the time of closing. The legal opinion will state that the Bonds are valid and binding general obligations of the City enforceable in accordance with their terms, except to the extent to which enforceability thereof may be limited by principles of equity, whether considered at law or in equity, or by state or federal laws relating to bankruptcy, reorganization, moratorium or creditors' rights. DELIVERY Within 40 days after the sale, the City will deliver to the Registrar the printed Bonds ready for completion and authentication. The original purchaser of the Bonds must notify the Registrar, at least five business days before issuance of the Bonds, ofthe persons in whose names the Bonds will be initially registered and the denominations of the Bonds to be originally issued. If notification is not received by that date, the Bonds will be registered in the name of the original purchaser and will be issued in denominations corresponding to the principal maturities of the Bonds. On the day of closing, the City will furnish to the purchaser the opinion of Bond Counsel described above, an arbitrage certification and a certificate stating that no litigation in any manner questioning the validity of the Bonds is then pending or, to the best knowledge of officers of the City, threatened. Payment for the Bonds must be received by the City in immediately available funds at its designated depository on the day of closing. The successful bidder shall submit to the Clerk of the Commission not earlier than 48 hours after the award of sale and not later than the date of closing a certificate, in form satisfactory to Bond Counsel, as to the initial reoffering prices of each stated maturity of the Bonds and stating that at least ten percent of the principal amount ofthe Bonds of each stated maturity has been sold at such prices. A-4 --_._-~-------_._---_._----- \ ~ OFFICIAL STATEMENT The City will prepare an Official Statement relating to the Bonds which the City will deem to be final as of its date. The City will deliver, at closing, a certificate executed by the Mayor, City Manager and Clerk of the Commission to the effect that, to the best of their knowledge, as of the date of closing, the information contained in the Official Statement, including any supplement thereto, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading; provided that no comment will be made with respect to any information provided by the successful bidder for inclusion in any supplement to the Official Statement. By submitting a bid for the Bonds, the successful bidder agrees: (1) to disseminate to all members of the underwriting syndicate copies of the Official Statement, including any supplements prepared by the City, (2) to file promptly a copy of the Official Statement, including any supplement prepared by the City, with a nationally recognized municipal securities repository, and (3) to take any and all other actions necessary to comply with applicable rules of the Securities and Exchange Commission and the Municipal Securities Rulemaking Board governing the offering, sale and delivery of the Bonds to ultimate purchasers. Within seven business days after the sale the City will furnish to the successful bidder without charge 95 copies of the final Official Statement relating to the Bonds. The successful bidder must notify the Clerk ofthe Commission in writing within two business days after the award of sale of the Bonds if it requires additional copies of the Official Statement. The cost of additional copies shall be paid by the successful bidder. COSTS; CUSIP NUMBERS The City will pay for the cost of bond counsel opinion, printing of the bonds and the fees and charges ofthe Registrar. The City will apply for CUSIP numbers but will assume no cost or obligation for the printing of CUSIP numbers on the Bonds or for the correctness of any numbers printed thereon. BY ORDER OF THE CITY COMMISSION Robin Sullivan, Clerk of the Commission A-5 \ '. EXHffiIT B NOTICE OF BOND SALE $1,685,000 General Obligation Bonds, Series 2003A City of Bozeman, Montana NOTICE IS HEREBY GIVEN that the City Commission (the "Commission") of the City of Bozeman, Montana (the "City"), will receive sealed bids for the purchase of $1 ,685,000 General Obligation Bonds, Series 2003A (the "Bonds") at the office ofthe Clerk of the Commission, City of Bozeman, 411 E. Main Street, Bozeman, Montana, until 11 :00 A.M., M.T., on January 13, 2003. The bids will be opened and tabulated by the Clerk of the Commission and presented to the Commission at its regular meeting at 3:00 P.M., M.T., on the same day in the City Commission meeting room. Bids will be compared on the basis of true interest cost (TIC) (calculated from the dated date). The Bonds will be issued for the purpose of acquiring land for and designing, constructing and equipping either a new public library or designing, constructing and equipping an expansion of the existing library and paying costs associated with the sale and issuance of the Bonds. If serial bonds are issued and sold, they will be issuable in the denominations of $5,000 or any integral multiple thereof of single maturities, and will mature on July 1, subject to redemption as hereinafter described, in the folIowing years and amounts: Year Amount Year Amount 2004 $ 65,000 2013 $ 95,000 2005 70,000 2014 100,000 2006 70,000 2015 95,000 2007 75,000 2016 105,000 2008 75,000 2017 110,000 2009 80,000 2018 115,000 2010 80,000 2019 120,000 2011 90,000 2020 120,000 2012 90,000 2021 130,000 The Bonds shall be issuable as fully registered bonds only, shall bear an original issue date of February 1,2003, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1,2003, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) ofthe immediately preceding month. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of 1 %. No supplemental or "B" coupons or additional interest certificates are permitted. The Bonds with stated maturities on or after July 1,2013 will be subject to redemption on July 1, 2012, and any day thereafter, at the option of the City, in whole or in part, and if in part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, ifno designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the Registrar by lot or other manner it deems B-1 ---- --- --..----.-.---..--- ..---- --...-.-.. ---.----....- - -.----------...--.---.-.....--...--.- ------...-----.--. , fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date. The Bonds will be issued in "book entry" only form. The City will designate the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. The Bonds will be sold for not less than $1,663,095 with accrued interest on the principal amount of the Bonds to the date of their delivery. The Commission reserves the right to reject any and all bids and to sell the Bonds at private sale. A good faith deposit in the form of money, cashier's check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federal Deposit Insurance Corporation or a financial surety bond in the sum of $33,700 payable to the order of the City of Bozeman, Montana, is required for each bid to be considered, as further specified in the Official Terms and Conditions of Sale. Copies of a statement of the Official Terms and Conditions of Sale and additional information may be obtained from Springsted Incorporated, 85 East 7th Place, Suite 100, St. Paul, Minnesota 55101, (651) 223-3000. Prospective bidders should consult the Official Terms and Conditions of Sale and the Preliminary Official Statement for a description of the Bonds, the security therefor, and the form of legal opinion proposed to be rendered by Dorsey & Whitney LLP, of Missoula, Montana, as bond counsel. Dated: ,2002. BY ORDER OF THE CITY COMMISSION Robin Sullivan Clerk of the Commission City of Bozeman, Montana Publish: December 29, 2002 January 5, 2003 B-2 .._.__.. __ .._._.. on_. .._.___ .._ _ . -... - .-. -..-- -.. -..-----.-...----- ----- -... .--... .--- - -- ---.- EXHIBIT A TERMS AND CONDITIONS OF SALE $1,685,000 General Obligation Bonds, Series 2003A City of Bozeman, Montana NOTICE IS HEREBY GIVEN by the City Commission (the "Commission") of the City of Bozeman, Montana (the "City"), that the City win receive sealed bids for the purchase of general obligation bonds in the office of the Clerk of the Commission in City Hall, at 411 E. Main Street, Bozeman, Montana, in the total principal amount of$I,685,000 (the "Bonds"), until 11:00 A.M., M.T., on January 13,2003. The bids will be opened and tabulated by the Clerk of the Commission and presented to the City Commission at its regular meeting at 3:00 P.M., M.T., on the same day, in the Commission meeting room, at which time the Commission will consider the bids received, and if a responsive and acceptable bid is received, award sale of the Bonds to the responsive bidder whose bid reflects the lowest true interest cost (TIC). THE BONDS The Bonds will bear an original issue date of February 1, 2003, and will bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1, 2003, to the registered owners of the Bonds as such appear in the bond register as ofthe close of business on the 15th day (whether or not a business day) of the immediately preceding month, at a rate or rates designated by the successful bidder at public sale and approved by the Commission. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of 1 % and shan be in level or ascending order. No supplemental or "B" coupons or additional interest certificates are permitted. All Bonds of the same stated maturity must bear interest from date of original issue until paid at a single, uniform rate. Interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months. The Bonds shall mature, subject to redemption as hereinafter provided, on July 1 in each ofthe following years and amounts: Year Amount Year Amount 2004 $ 65,000 2013 $ 95,000 2005 70,000 2014 100,000 2006 70,000 2015 95,000 2007 75,000 2016 105,000 2008 75,000 2017 110,000 2009 80,000 2018 115,000 2010 80,000 2019 120,000 2011 90,000 2020 120,000 2012 90,000 2021 130,000 Bonds shall be in the denomination of $5,000 each or any integral multiple thereof of single maturities. The Bonds will be issued as fully registered bonds only and shall be executed A-I .- -.- -.-...--.-..-.-.... -.---.--....--.---..-.- -----.---.----------.---. by the manual or facsimile signatures of the Mayor, City Manager and the Clerk of the Commission. The Bonds with stated maturities on or after July 1, 2013 will be subject to redemption on July I, 2012, and any day thereafter, at the option ofthe City, in whole or in part, and ifin part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, if no designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereofto be redeemed plus interest accrued to the redemption date. BOOK ENTRY The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"), New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of$5,000 or any multiple thereof ofa single maturity, through book entries made on the books and records ofDTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery ofthe Bonds, will be required to deposit the Bonds with DTC. PURPOSE AND SECURITY The Bonds will be issued for the purpose of acquiring land for and designing, constructing and equipping either a new public library or designing, constructing and equipping an expansion of the existing library and paying costs associated with the sale and issuance of the Bonds, in accordance with the provisions of Montana Code Annotated, Title 7, Chapter 7, Part 42, as amended. The Bonds will be general obligations of the City to the payment of which the full faith, credit and taxing power ofthe City will be pledged. Bidders should consult a copy of the Official Statement for a discussion of the security for the Bonds and the form of opinion of bond counsel relating to the Bonds. CONTINUING DISCLOSURE In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph (b)(5) of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 (the "Rule"), the City will covenant and agree, for the benefit of the registered holders and beneficial owners from time to time of the outstanding Bonds, in the resolution prescribing the terms of the Bonds to provide annual reports of specified information and notice of the occurrence of certain events, if material. The City is the only "obligated person" in respect of the Bonds within the A-2 ..._n____ --...---.-...-... meaning of the Rule for the purposes of disclosing information on an ongoing basis. A description of the undertaking is set forth in the Official Statement. Failure of the City to enter into an undertaking substantially similar to that described in the Official Statement would relieve the successful bidder of its obligation to purchase the Bonds. The City has complied in all material respects with any undertaking previously entered into by it under the Rule. QUALIFIED TAX-EXEMPT OBLIGATIONS The Bonds will be designated by the City as "qualified tax-exempt obligations" within the meaning of Section 265(b )(3) of the Internal Revenue Code of 1986, as amended (the "Code"), and financial institutions described in Section 265(b)(5) of the Code may treat the Bonds for purposes of Sections 265(b )(2) and 291 (e)(1 )(B) of the Code as if they were acquired on August 7, 1986. BIDDING AND SALE PROCEDURES Submission of Bids. Bids must be on the Official Bid form, a copy of which may be obtained from the Financial Advisor and enclosed in a sealed envelope marked as follows: "Bid for $1,685,000 General Obligation Bonds, Series 2003A, City of Bozeman, Montana" and delivered to the Clerk of the Commission. Each envelope when delivered must indicate on the outside the name and address of the bidder, or in the case of a group of bidders, of the representative. Basis of Award. The Bonds will be sold for not less than $1,163,095.00 with accrued interest to the date of delivery, and all bidders must state the lowest rate or rates of interest at which they will purchase the Bonds at par. Bids will be compared on the basis of true interest cost (TIC). The TIC is the effective cost of the Bonds based on bond proceeds received at closing calculated from the dated date of the Bonds. In the event that two or more bids state the lowest true interest cost, the sale of the Bonds will be awarded by lot. The Commission will accept sealed or faxed bids only. The Commission reserves the right to reject any and all bids and to sell the Bonds at private sale and to waive any informality and irregularity in any and all bids. Bidders must bid for all or none ofthe Bonds. Each bid must be unconditional (or conditioned on only those items specified in these Official Terms and Conditions of Sale). No bid may be altered or withdrawn after the time specified above for opening bids without the express consent of the Commission. Good Faith Deposit. A good faith deposit (the "Deposit") in the form of money, cashier's check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federal Deposit Insurance Corporation or a financial surety bond in the sum of $33,700 payable to the order of the City of Bozeman, Montana is required for each bid to be considered. Ifmoney, cashier's check, certified check, bank money order, or bank draft is used, it must accompany each bid and be delivered to the Clerk of the Commission. If a financial surety bond is used, it must be from an insurance company licensed and qualified to issue such a bond in the State of Montana and such bond must be submitted to the Clerk of the Commission, or its financial advisor prior to the opening of the bids. The financial surety bond must identify each bidder whose Deposit is guaranteed by such financial surety bond. If the Bonds are awarded to a bidder utilizing a financial surety bond, then A-3 that purchaser is required to submit its Deposit to the City in the form ofa cashier's check (or wire transfer such amount as instructed by the City or its financial advisor) not later than 1:00 P.M., M.T., on the next business day following the award. If such Deposit is not received by that time, the financial surety bond may be drawn by the City to satisfy the Deposit requirement. No interest on the Deposit will accrue to the purchaser. The Deposit will be applied to the purchase price of the Bonds. In the event the purchaser fails to honor its accepted bid, the Deposit will be retained by the City. The Deposit ofthe unsuccessful bidders will be returned immediately on award of sale of the Bonds or after rejection of all bids. Instructions for wiring a Deposit may be obtained from the City's Financial Advisor, Springsted Incorporated, 85 East i Place, Suite 100, St. Paul, Minnesota 5510 1, (651) 223- 3000. BOND REGISTRAR, TRANSFER AGENT AND PAYING AGENT The City will designate and contract with a suitable bank or trust company to act as bond registrar, transfer agent and paying agent (the "Registrar"). The bond register will be kept, transfers of ownership will be effected and principal of and interest on the Bonds will be paid by the Registrar. The City will pay the charges of the Registrar for such services. The City reserves the right to remove the Registrar and to appoint a successor. LEGAL OPINION An opinion as to the validity of the Bonds and the exclusion from gross income for federal and Montana income tax purposes of the interest thereon will be furnished by Dorsey & Whitney LLP, of Missoula, Montana, and Minneapolis, Minnesota, as Bond Counsel. The legal opinion will be delivered at the time of closing. The legal opinion will state that the Bonds are valid and binding general obligations of the City enforceable in accordance with their terms, except to the extent to which enforceability thereof may be limited by principles of equity, whether considered at law or in equity, or by state or federal laws relating to bankruptcy, reorganization, moratorium or creditors' rights. DELIVERY Within 40 days after the sale, the City will deliver to the Registrar the printed Bonds ready for completion and authentication. The original purchaser of the Bonds must notify the Registrar, at least five business days before issuance ofthe Bonds, of the persons in whose names the Bonds will be initially registered and the denominations of the Bonds to be originally issued. If notification is not received by that date, the Bonds will be registered in the name ofthe original purchaser and will be issued in denominations corresponding to the principal maturities of the Bonds. On the day of closing, the City will furnish to the purchaser the opinion of Bond Counsel described above, an arbitrage certification and a certificate stating that no litigation in any manner questioning the validity of the Bonds is then pending or, to the best knowledge of officers of the City, threatened. Payment for the Bonds must be received by the City in immediately available funds at its designated depository on the day of closing. The successful bidder shall submit to the Clerk of the Commission not earlier than 48 hours after the award of A-4 ...n ______". sale and not later than the date of closing a certificate, in fonn satisfactory to Bond Counsel, as to the initial reoffering prices of each stated maturity of the Bonds and stating that at least ten percent of the principal amount of the Bonds of each stated maturity has been sold at such prices. OFFICIAL STATEMENT The City will prepare an Official Statement relating to the Bonds which the City will deem to be final as of its date. The City will deliver, at closing, a certificate executed by the Mayor, City Manager and Clerk of the Commission to the effect that, to the best of their knowledge, as of the date of closing, the infonnation contained in the Official Statement, including any supplement thereto, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading; provided that no comment will be made with respect to any infonnation provided by the successful bidder for inclusion in any supplement to the Official Statement. By submitting a bid for the Bonds, the successful bidder agrees: (1) to disseminate to all members of the underwriting syndicate copies of the Official Statement, including any supplements prepared by the City, (2) to file promptly a copy of the Official Statement, including any supplement prepared by the City, with a nationaIly recognized municipal securities repository, and (3) to take any and all other actions necessary to comply with applicable rules of the Securities and Exchange Commission and the Municipal Securities Rulemaking Board governing the offering, sale and delivery of the Bonds to ultimate purchasers. Within seven business days after the sale the City will furnish to the successful bidder without charge 95 copies ofthe final Official Statement relating to the Bonds. The successful bidder must notify the Clerk of the Commission in writing within two business days after the award of sale of the Bonds if it requires additional copies of the Official Statement. The cost of additional copies shall be paid by the successful bidder. BOND INSURANCE AT PURCHASER'S OPTION Prospective purchasers may seek to qualify the Bonds for insurance. If the Bonds qualify for issuance of any policy of municipal bond insurance or commitment therefor at the option of the bidder, the purchase of any such insurance policy or the issuance of any such commitment shaIl be at the sole option and expense of the purchaser of the Bonds. Any increased costs of issuance of the Bonds resulting from such purchase of insurance shall be paid by the purchaser, except that, ifthe City has requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall be the responsibility of the purchaser. Failure of the municipal bond insurer to issue the policy after Bonds have been awarded to the purchaser shall not constitute cause for failure or refusal by the purchaser to accept delivery on the Bonds. A-5 COSTS; CUSIP NUMBERS The City will pay for the cost of bond counsel opinion, printing of the bonds and the fees and charges of the Registrar. The City will apply for CUSIP numbers but will assume no cost or obligation for the printing of CUSIP numbers on the Bonds or for the correctness of any numbers printed thereon. BY ORDER OF THE CITY COMMISSION Robin Sullivan, Clerk of the Commission A-6 ~ - __ __..____n_ EXHIBIT B NOTICE OF BOND SALE $1,685,000 General Obligation Bonds, Series 2003A City of Bozeman, Montana NOTICE IS HEREBY GIVEN that the City Commission (the "Commission") of the City of Bozeman, Montana (the "City"), will receive sealed bids for the purchase of$1,685,000 General Obligation Bonds, Series 2003A (the "Bonds") at the office ofthe Clerk ofthe Commission, City of Bozeman, 411 E. Main Street, Bozeman, Montana, until 11 :00 A.M., M.T., on January 13,2003. The bids will be opened and tabulated by the Clerk of the Commission and presented to the Commission at its regular meeting at 3:00 P.M., M.T., on the same day in the City Commission meeting room. Bids will be compared on the basis of true interest cost (TIC) (calculated from the dated date). The Bonds will be issued for the purpose of acquiring land for and designing, constructing and equipping either a new public library or designing, constructing and equipping an expansion of the existing library and paying costs associated with the sale and issuance of the Bonds. If serial bonds are issued and sold, they will be issuable in the denominations of $5,000 or any integral multiple thereof of single maturities, and will mature on July 1, subject to redemption as hereinafter described, in the following years and amounts: Year Amount Year Amount 2004 $ 65,000 2013 $ 95,000 2005 70,000 2014 100,000 2006 70,000 2015 95,000 2007 75,000 2016 105,000 2008 75,000 2017 110,000 2009 80,000 2018 115,000 2010 80,000 2019 120,000 2011 90,000 2020 120,000 2012 90,000 2021 130,000 The Bonds shall be issuable as fully registered bonds only, shall bear an original issue date of February 1,2003, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1,2003, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) of the immediately preceding month. Each rate must be expressed in an integral multiple of 1/8 or 5/1 00 of 1 % and shall be in level or ascending order. No supplemental or "B" coupons or additional interest certificates are permitted. The Bonds with stated maturities on or after July 1, 2013 will be subject to redemption on July 1,2012, and any day thereafter, at the option of the City, in whole or in part, and if in part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, ifno designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the B-1 --...---....-..--.-- Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date. The Bonds will be issued in "book entry" only form. The City will designate the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b )(3) of the Internal Revenue Code of 1986, as amended. The Bonds will be sold for not less than $1,663,095 with accrued interest on the principal amount of the Bonds to the date of their delivery. The Commission reserves the right to reject any and all bids and to seIl the Bonds at private sale. A good faith deposit in the form of money, cashier's check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federa] Deposit Insurance Corporation or a financial surety bond in the sum of $33,700 payable to the order of the City of Bozeman, Montana, is required for each bid to be considered, as further specified in the Offici a] Terms and Conditions of Sale. Copies of a statement of the Official Terms and Conditions of Sale and additional information may be obtained from Springsted Incorporated, 85 East 7th Place, Suite 100, St. Paul, Minnesota 55101, (65]) 223-3000. Prospective bidders should consult the Official Terms and Conditions of Sale and the Preliminary Official Statement for a description of the Bonds, the security therefor, and the form of legal opinion proposed to be rendered by Dorsey & Whitney LLP, of Missoula, Montana, as bond counsel. Dated: ,2002. BY ORDER OF THE CITY COMMISSION Robin Sullivan Clerk of the Commission City of Bozeman, Montana Publish: December 29,2002 January 5, 2003 B-2 ....--..,.------ EXHIBIT B NOTICE OF BOND SALE $1,685,000 General Obligation Bonds, Series 2003A City of Bozeman, Montana NOTICE IS HEREBY GIVEN that the City Commission (the "Commission") of the City of Bozeman, Montana (the "City"), will receive sealed bids for the purchase of$I,685,000 General Obligation Bonds, Series 2003A (the "Bonds") at the office ofthe Clerk ofthe Commission, City of Bozeman, 411 E. Main Street, Bozeman, Montana, until 11:00 A.M., M.T., on January 13,2003. The bids will be opened and tabulated by the Clerk ofthe Commission and presented to the Commission at its regular meeting at 3:00 P.M., M.T., on the same day in the City Commission meeting room. Bids will be compared on the basis oftrue interest cost (TIC) (calculated from the dated date). The Bonds will be issued for the purpose of acquiring land for and designing, constructing and equipping either a new public library or designing, constructing and equipping an expansion of the existing library and paying costs associated with the sale and issuance of the Bonds. If serial bonds are issued and sold, they will be issuable in the denominations of $5,000 or any integral multiple thereof of single maturities, and will mature on July 1, subject to redemption as hereinafter described, in the following years and amounts: Year Amount Year Amount 2004 $ 65,000 2013 $ 95,000 2005 70,000 2014 100,000 2006 70,000 2015 95,000 2007 75,000 2016 105,000 2008 75,000 2017 110,000 2009 80,000 2018 115,000 2010 80,000 2019 120,000 2011 90,000 2020 120,000 2012 90,000 2021 130,000 The Bonds shall be issuable as fully registered bonds only, shall bear an original issue date of February 1,2003, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing July 1,2003, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) ofthe immediately preceding month. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of 1 %_and shall be in leveLor a.sq:~;I14ing_9rder. No supplemental or "B" coupons or additional interest certificates are permitted. The Bonds with stated maturities on or after July 1, 2013 will be subject to redemption on July 1,2012, and any day thereafter, at the option ofthe City, in whole or in part, and if in part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, if no designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the ----.--..-....- ----.-------..--...- Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date. The Bonds will be issued in "book entry" only form. The City will designate the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b )(3) of the Internal Revenue Code of 1986, as amended. The Bonds will be sold for not less than $1,663,095 with accrued interest on the principal amount of the Bonds to the date of their delivery. The Commission reserves the right to reject any and all bids and to sell the Bonds at private sale. A good faith deposit in the form of money, cashier's check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federal Deposit Insurance Corporation or a financial surety bond in the sum of $33,700 payable to the order of the City of Bozeman, Montana, is required for each bid to be considered, as further specified in the Official Terms and Conditions of Sale. Copies of a statement of the Official Terms and Conditions of Sale and additional information may be obtained from Springsted Incorporated, 85 East 7th Place, Suite 100, St. Paul, Minnesota 55101, (651) 223-3000. Prospective bidders should consult the Official Terms and Conditions of Sale and the Preliminary Official Statement for a description of the Bonds, the security therefor, and the form of legal opinion proposed to be rendered by Dorsey & Whitney LLP, of Missoula, Montana, as bond counsel. Dated: ,2002. BY ORDER OF THE CITY COMMISSION Robin Sullivan Clerk of the Commission City of Bozeman, Montana Publish: December 29,2002 January 5, 2003 2