Tab 16 Resolution 4622CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE
I, the undersigned, being the duly qualified and acting recording officer of the City of Kalispell,
Montana (the "City"), hereby certify that the attached resolution is a true copy of a Resolution entitled:
""RESOLUTION RELATING TO $1,581,500 SPECIAL IMPROVEMENT DISTRICT NO. 343
BONDS - FIXING THE FORM AND DETAILS AND PROVIDING FOR THE EXECUTION
AND DELIVERY THEREOF AND SECURITY THEREFOR" (the "Resolution"), on file in the
original records of the City in my legal custody; that the Resolution was duly adopted by the City
Commission of the City at a regular meeting on June 4, 2001, and that the meeting was duly held by the
City Commission and was attended throughout by a quorum, pursuant to call and notice of such
meeting given as required by law; and that the Resolution has not as of the date hereof been amended
or repealed.
I further certify that, upon vote being taken on the Resolution at said meeting, the following
Council members voted in favor thereof: William E. Boharski, Jim Atkinson, Dale Haarr, Duane
Larson, Fred Leistiko, Douj� Scarff and Ron Van Natta; voted against the same: none; abstained fTom
voting thereon-, none; or were absent: 'Don Counsell and RqLdy Kenvon.
S
WITNESS my hand and seal officially thi `�'day of June, 2001.
0 F
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k9WRATE"- A
SEAL
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City Clerk
..............
RESOLUTION NO. 4622
RESOLUTION RELATING TO $1,581,500 SPECIAL IMPROVEMENT
DISTRICT NO. 343 BONDS FIXING THE FORM AND DETAILS AND
PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF AND
SECURITY THEREFOR
BE IT RESOLVED by the City Council (the "Council") of the City of Kalispell, Montana
(the "City"), as follows:
Section 1. Recitals. It is hereby found, determined and declared as follows:
1.01. Resolution of Intention. By Resolution No. 4596, adopted January 22, 2001 (the
"Resolution of Intention"), this Council declared its intention to create Special Improvement District No.
343 (the "District"), for the purpose of making special improvements for the special benefit of the
District. The Resolution of Intention designated the number of the District, described the boundaries
thereof, and stated the general character of the improvements to be made (the "Improvements") and an
approximate estimate of the costs thereof, in accordance with the provisions of Montana Code
Annotated, Title 7, Chapter 12, Parts 41 and 42, as amended (the "Act"). By the Resolution of
Intention this Council also declared its intention to cause the cost and expense of making the
improvements specially benefitting the District to be assessed against the properties included within the
boundaries thereof in accordance with one or more methods of assessment authorized in Montana
Code Annotated, Sections 7-12-4161 to 7-12-4165 and as set forth in the Resolution of Intention.
Capitalized tenns used herein without definition shall have the meanings given them in the Resolution of
Intention.
In the Resolution of Intention., this Council further found that it is in the public interest, and in
the best interest of the City and the District, to secure payment of principal of and interest on the Bonds
by the Special Improvement District Revolving Fund of the City, on the basis of the factors required to
be considered under Section 7-12-4225 of the Act. Those findings are hereby ratified and confirmed.
The Council further found that it is in the public interest, and in the best interest of the City and the
District, to establish a reserve account securing the Bonds in the District fund. Those findings are
hereby ratified and confirmed. The Council also declared its intention to reimburse the City for costs
paid before issuance of the Bonds, as required by Section 1. 150-2 of the Income Tax Regulations
promulgated under the Internal Revenue Code.
1.02. Notices. Notice of the passage of the Resolution of Intention was given by two
publications, with at least six days between publications, the first no more than 21 days prior to the
hearing and the last no less than 3 days prior to the hearing, in a qualified newspaper of general
circulation in the county in which the City is located or, if no such newspaper is published, in a qualified
newspaper published in an adjacent county, as required by Montana Code Annotated, Sections 7-12-
4106(2) and 7-1-2121. Notice of the passage of the Resolution of Intention was also mailed to all
persons, firms or corporations or the agents thereof having real property within the District listed in their
names upon the last completed assessment roll for state, county and school district taxes, at their last
known addresses. The notice described the general character of the ]Improvements, stated the
estimated cost of the Improvements and the method or methods of assessment of such costs against
properties in the District, specified the time when and the place where the Council would hear and pass
upon all protests made against the making of the Improvements or the creation of the District, referred
to the Resolution of Intention as being on file in the office of the City Clerk for a description of the
boundaries of the District, all in accordance with the provisions of the Resolution of Intention, and
included a statement that, subject to the limitations of Section 7-12-4222 of the Act, the general fund of
the City may be used to provide loans to the revolving fund or a general tax levy may be imposed on all
taxable property in the City to meet the financial requirements of the revolving fund.
1.03. 'Creation of District; -Modification of District Boundaries. At the time and place
specified in the notice hereinabove described, this Council met to hear, consider and pass upon all
protests made against the making of the Improvements and the creation of the District, and, after
consideration thereof and continuing the hearing for further deliberation, it was determined and declared
that insufficient protests against the creation of the District or the proposed work had been filed in the
time and manner provided by law by the owners of the property to be assessed for the Improvements
in the District, and this Council therefore, did by Resolution No. 4602, adopted March 5, 2001, create
the District and order the proposed Improvements in accordance with the Resolution of Intention. In
the resolution, the Council also confirmed the findings it made with respect to the pledge of the
Revolving Fund and the establishment of the Reserve Account in the Resolution of Intention. The
Council then determined that it was in the best interests of the District and the City to modify the
boundaries of the District and thereby remove a property from the District, and this Council did
therefore, by Resolution No. 4605, adopted March 19, 200 1, modify the boundaries of the District
and, in connection therewith, resolved to assess one of the properties in the District the assessment
originally scheduled to be levied against the property removed from the District, with the consent of the
owner of the property to be so assessed.
1.04. Construction Contracts and Related Costs. Plans, specifications, maps, profiles and
surveys for construction of the Improvements were prepared by the engineers acting for the City, and
were thereupon examined and approved by this Council. An advertisement for bids for construction of
the Improvements was published in the official newspaper of the City in accordance with the provisions
of Montana Code Annotated, Section 7-12-4141, after which the bids theretofore received were
opened and examined. After referring the bids to the engineers for the City it was determined that the
lowest regular proposal for the famishing of work and materials required for constructing the
Improvements in accordance with the approved plans and specifications was the following:
-2-
Work
.Bidder Contract Price
Realigning Sunnyview Lane, Extending Heritage Way, A-1 Paving $722,093.50
Site Grading, Certain Utilities Work, and Construction
and Installation of Surface Improvements
A contract for the construction of the Improvements was therefore awarded to said bidder, subject to
the right of owners of property liable to be assessed for the costs thereof to elect to take the work and
enter into written contracts therefor in the manner provided by Montana Code Annotated, Section 7-
12-4147, which election the property owners failed to make, whereupon the City and the successful
bidder entered into a written contract for construction of the Improvements upon the bidder having
executed and filed bonds satisfactory to this Council and in the form and manner provided by Montana
Code Annotated, Title 18, Chapter 2, Part 2, as amended.
In addition to the above contract for construction, the relocation and burying of the utilities
forming a part of the Improvements will require work and materials of various utility providers, the total
direct costs of which are estimated to be $3733215.47.
1.05. Costs. Costs of the Improvements in excess of the costs to be assessed against the
District will be paid from gas tax funds available therefor in the amount of $37,000. It is currently
estimated that the total costs and expenses of the Improvements are $1,618,500 and that the costs and
expenses to be assessed against properties benefitted by the Improvements, including costs of
preparation of plans, specifications, maps, profiles, engineering superintendence and inspection,
preparation of assessment rolls, expenses of making the assessments, the cost of work and materials
under the construction contract and all other costs and expenses, including the deposits of proceeds in
the Revolving Fund and in the Reserve Account in the District Fund, are $1,581,500. Such amount will
be levied and assessed upon the assessable real property within the District on the bases described in
the Resolution of Intention, and the City's contribution of $37,000 will have the effect of reducing the
total amount to be financed to $1,581,500 and of benefitting certain properties in the District to the
exclusion of two properties in the District, the owners of such two properties having consented thereto.
This Council has Jurisdiction and is required by law to levy and assess $1,581,500, together with
interest thereon, to collect such special assessments and credit the same to the special improvement
district fund created for the District, which fund is to be maintained on the official books and records of
the City separate from all other City funds, for the payment of principal and interest when due on the
bonds herein authon*zed.
1.06. Sale and Issuance of Bonds. For the purpose of financing the costs and expenses of
making the Improvements, which are to be assessed against the property within the District as provided
in the Resolution of Intention, this Council by Resolution No. 4610, adopted May 7, 200 1, called for
the public sale of bonds in the total aggregate amount of $1,581,500 (the "Bonds"). Advertisements
for bids for the purchase of the Bonds were published in accordance with the provisions of Montana
-3-
Code Annotated, Sections 7-12-4204, 7-7-4252 and 17-5-106. Pursuant to Resolution No. 4621,
adopted May 23, 200 1, this Council authorized the City to enter into a contract with D.A. Davidson &
Co. of Great Falls, Montana (the "Purchaser"), as the lowest responsible bidder pursuant to which the
Purchaser agreed to purchase from the City the Bonds at a purchase price of $1,549,870 plus interest
accrued thereon from the date of original issue of the Bonds, at the rates of interest set forth in Section
2.01 hereof and upon the further terms set forth in this resolution resulting in a true interest cost of
5.312% per annum and a total dollar interest cost of $861,265.79.
1.07. Recitals. All acts, conditions and things required by the Constitution and laws of the
State of Montana, including Montana Code Annotated, Title 7, Chapter 12, Parts 41 and 42, as
amended, in order to make the Bonds valid and binding special obligations in accordance with their
tenns and in accordance with the terms of this resolution have been done, do exist, have happened and
have been performed in regular and due form, time and manner as so required.
Section 2. The Bonds.
2.01. Principal Amount.,...Maturities 0
Denominations
, Date, Interest Rates. For the purpose of
paying the costs and expenses incurred in construction of the Improvements, and in anticipation of the
collection of special assessments to be levied therefor, and in accordance with the proposal described
in Section 1.06, the City shall forthwith issue and deliver to the Purchaser the Bonds payable solely
from the Special Improvement District No. 343 Fund (the "District Fund") and denominated "Special
Improvement District No. 343 Bonds." The Bonds shall be dated, as originally issued, and be
registered as of June 1, 2001, shall each be in the denomination of $5,000 or any integral multiple
thereof of single maturities, provided that the Bond with the stated maturity in 2002 shall be in the
principal amount of $6,500, shall mature on July 1 in the years and principal amounts set forth below,
and Bonds maturing in such years and principal amounts shall bear interest from the date of original
registration until paid or duly called for redemption at the rates per annum. set forth opposite such years
and amounts, respectively:
Principal
Principal
Year
Amount
Rate
Year
Amount
Rate
2002
$ 76�500
3.60%
2012
$8000
4.90%
2003
7500
3.75
2013
805000
5.00
2004
75NO
4.00
2014
W000
5.10
2005
75�000
4.10
2015
8000
5.20
2006
80)000
4.20
2016
80,000
5.30
2007
80�000
4.35
2017
809000
5.40
2008
80po
4.50
2018
K000
5.50
2009
K000
4.60
2019
805000
5.50
2010
805000
4.70
2020
803�000
5.50
2011
805000
4.80
2021
K000
5.50
KA I
2.02. Interest PgNIjent Dates. Interest on the Bonds shall be payable on each
January 1 and July 1, commencing January 1, 2002, to the owners of record thereof as such appear on
the bond registrar at the close of business on the fifteenth day of the immediately preceding month,
whether or not such day is a business day. Upon the original delivery of the Bonds to the Purchaser
and upon each subsequent transfer or exchange of a Bond pursuant to Section 2.04, the Registrar shall
date each Bond as of the date of its authentication.
2.03. Method of Pavrnent. The Bonds shall be issued only in fully registered form. The
interest on and, upon surrender thereof at the operations center of the Registrar (as hereinafter defined),
the principal of each Bond, shall be payable by check or draft drawn on the Registrar.
2.04. Registration. The City hereby appoints U.S. Bank Trust National Association MT, of
Billings, Montana, to act as registrar, transfer agent and paying agent (the "Registrar"). The City
reserves the right to appoint a successor bond registrar, transfer agent or paying agent, as authorized by
the Model Public Obligations Registration Act of Montana, Montana Code Annotated, Title 17,
Chapter 5, Part 11, as amended (the "Registration Act"), but the City agrees to pay the reasonable and
customary charges of the Registrar for the services performed. This Section 2.04 shall establish a
system of registration for the Bonds as defined in the Registration Act.
The effect of registration and the rights and duties of the City and the Registrar with respect
thereto shall be as follows:
(a) Bond Register. The Registrar shall keep at its operations center a bond register in which
the Registrar shall provide for the registration of ownership of the Bonds and the registration of transfers
and exchanges of the Bonds entitled to be registered, transferred or exchanged.
(b) Transfer. Upon surrender to the Registrar for transfer of any Bond duly endorsed by the
registered owner thereof or accompanied by a written instrument of transfer, in form satisfactory to the
Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the
registered owner in writing, the Registrar shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Bonds of a like aggregate principal amount and maturity, as
requested by the transferor. The Registrar may, however, close the books for registration of any
transfer of any Bond or portion thereof selected or called for redemption. No transfer or exchange of a
Bond shall affect its order of registration for purposes of redemption pursuant to Section 2.05.
(c) Exch . Whenever any Bond is surrendered by the registered owner for exchange, the
Registrar shall authenticate and deliver one or more new Bonds of a like aggregate principal amount,
interest rate and maturity, as requested by the registered owner or the owner's attorney duly authon* zed
in writing.
Irb"I
(d) Cancellation. All Bonds surrendered upon any transfer or exchange shall be promptly
cancelled by the Registrar and thereafter disposed of as directed by the City.
(e) hUroper or Unauthorized Transfer. When any Bond is presented to the Registrar for
transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on such
Bond or separate instrument of transfer is valid and genuine and that the requested transfer is legally
authorized. The Registrar shall incur no liability for the refusal, in good faith, to make transfers which it,
in its judgment, deems improper or unauthorized.
(f) Persons Deemed Owners. The City and the Registrar may treat the person in whose name
any Bond is at any time registered in the bond register as the absolute owner of such Bond, whether
such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the
principal of and interest on such Bond and for all other purposes, and all such payments so made to any
such registered owner or upon the owner's order shall be valid and effectual to satisfy and discharge
the liability of the City upon such Bond to the extent of the sum or sums so paid.
(g) Taxes, Fees and Charges. For every transfer of Bonds or exchange of Bonds (except an
exchange upon a partial redemption of a Bond), the Registrar may impose a charge upon the owner
thereof sufficient to reimburse the Registrar for any tax, fee or other governmental charge required to be
paid with respect to such transfer or exchange.
(h) Mutilated, Lost, -Stolen or Destroyed Bonds. In case any Bond shall become mutilated or
be destroyed, stolen or lost, the Registrar shall deliver a new Bond of like amount, number,, maturity
date and tenor in exchange and substitution for and upon cancellation of any such mutilated Bond or in
lieu of and in substitution for any such Bond destroyed, stolen or lost, upon the payment of the
reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a Bond
destroyed, stolen or lost, upon filing with the Registrar of evidence satisfactory to it that such Bond was
destroyed, stolen or lost, and of the ownership thereof, and upon furnishing to the Registrar an
appropriate bond or indemnity in form, substance and amount satisfactory to it, in which both the City
and the Registrar shall be named as obligees. All Bonds so surrendered to the Registrar shall be
cancelled by it and evidence of such cancellation shall be given to the City. If the mutilated, destroyed,
stolen or lost Bond has already matured or such Bond has been called for redemption in accordance
w ith its terms 9 it shall not be necessary to issue a new Bond prior to payment.
1 1
2.05. RedeWtion-
(a) Mandato].r 1
,y Redem-Ption. If on any *nterest payment date there will be a balance in the
Distn*ct Fund after payment of the principal and interest due on all Bonds drawn against it, either from
the prepayment of special assessments levied in the District or from the transfer of surplus money from
the Construction Account to the Principal Account as provided in Section 3.02 or otherwise, the City
Finance Officer shall call for redemption on the interest payment date outstanding Bonds, or portions
thereof, in an amount which, together with the interest thereon to the interest payment date, will equal
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the amount of such ftmds on deposit in the District Fund on that date. The redemption price shall equal
the amount of the principal amount of the Bonds to be redeemed plus interest accrued to the date of
redemption.
(b) Optional RedgMtion. The Bonds are subject to redemption, in whole or in part, at the
option of the City from sources of funds available therefor other than those described in Subsection (a)
of this Section 2.05 on any interest payment date; provided, however, the City agrees not to redeem
Bonds from (i) amounts on deposit in the Reserve Account in the District Fund or (ii) proceeds of
refunding bonds prior to July 1, 2006. The redemption price shall equal the principal amount of the
Bonds to be redeemed plus interest accrued to the date of redemption.
(c) Selection of Bonds for Redempti artial Redgmption. If less than all of the Bonds are
to be redeemed, Bonds shall be redeemed in order of the stated maturities thereof. If less than all
Bonds of a stated maturity are to be redeemed, the Bonds of such maturity shall be selected for
redemption in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair,
except that the Bond with the stated maturity in 2002 and in the principal amount of $6,500 shall be
redeemed before other Bonds of such stated maturity. Upon partial redemption of a Bond, a new
Bond or Bonds will be delivered to the registered owner without charge, representing the remaining
principal amount thereof outstanding.
(d) Notice and Effect of Redelnption. The date of redemption and the principal amount of
the Bonds shall be fixed by the City Finance Officer, who shall give notice thereof to the Registrar in
sufficient time for the Registrar to give notice, by first class mail, postage prepaid, or by other means
required by the securities depository, to the owner or owners of such Bonds at their addresses
appearing in the bond register, of the numbers of the Bonds or portions thereof to be redeemed and the
date on which payment will be made, which date shall be not less than thirty (30) days after the date of
mailing notice. On the date so fixed interest on the Bonds or portions thereof so redeemed shall cease.
2.06. Form. The Bonds shall be drawn in substantially the form set forth in Exhibit A hereto,
and by this reference made a part hereof, with such modifications as are permitted by the Act.
2.07. Execution, Registration and Deli . The Bonds shall be prepared under the direction
of the City Clerk and shall be executed on behalf of the City by the signatures of the Mayor, City
Manager and the Finance Officer; provided that the signatures and the corporate seal may be printed,
engraved or lithographed facsimiles of the originals. The seal of the City need not be impressed or
imprinted on any Bond. In case any officer whose signature or a facsimile of whose signature shall
appear on the Bonds shall cease to be such officer before the delivery of any Bond, such signature or
facsimile shall nevertheless be valid and sufficient for all purposes, the same as if such officer had
remained in office until delivery. Notwithstanding such execution, no Bond shall be valid or obligatory
for any purpose or entitled to any security or benefit under this resolution unless a certificate of
authentication and registration on such Bond has been duly executed by the manual signature of an
authorized representative of the Registrar. Certificates of authentication and registration on different
SVA
Bonds need not be signed by the same representative. The executed certificate of authentication and
registration on each Bond shall be conclusive evidence that it has been authenticated and delivered
under this resolution. The Bonds shall be registered in order of their serial numbers by the Registrar, as
attested by the Certificate of Authentication, as of June 1, 2001. When the Bonds have been so
executed, authenticated and registered, they shall be delivered by the Registrar to the Purchaser upon
payment of the purchase price in accordance with the contract of sale heretofore made and executed.
The Purchaser shall not be obligated to see to the application of the purchase price, but from the
proceeds of the Bonds the Finance Officer (or her designee) shall credit forthwith $79,075 to the
Revolving Fund, as required by Section 7-12-4169(2) of the Act, $79,075 to the District Reserve
Account in the District Fund, as authorized by Section 7-12-4169(3) of the Act, any accrued interest to
the Interest Account in the District Fund, and the balance of such proceeds to the Construction
Account in the District Fund.
2.08. Securities Dgpository for the Bonds.
(a) For purposes of this Section 2.08, the following terms shall have the following meanings:
1"Beneficial Owner" shall mean, whenever used with respect to a Bond, the person in whose
name such Bond is recorded as the beneficial owner of such Bond by a Participant on the
records of such Participant, or such person's subrogee.
"Cede & Co." shall mean Cede & Co., the nominee of DTC, and any successor nominee of
DTC with respect to the Bonds.
"DTC" shall mean The Depository Trust Company of New York, New York.
"Participant" shall mean any broker -dealer, bank or other financial institution for which DTC
holds the Bonds as securities depository.
"Representation Letter" shall mean the Blanket Issuer Letter of Representations from the City
to DTC, attached to this resolution as Exhibit B, which is hereby incorporated by reference
and made a part hereof.
(b) The Bonds shall be initially issued as separately authenticated fully registered Bonds, and
one Bond shall be issued in the principal amount of each stated maturity of.the Bonds. Upon initial
issuance, the ownership of such Bonds shall be registered in the Bond register in the name of Cede &
Co., as nominee of DTC. The Registrar and the City may treat DTC (or its nominee) as the sole and
exclusive owner of the Bonds registered in its name for the purposes of payment of the principal of or
interest on the Bonds, selecting the Bonds or portions thereof to be redeemed, if any, giving any notice
itted or required to be given to registered owners of Bonds under this Resolution, registering the
permi 1
transfer of Bonds'. and for all other purposes whatsoever; and neither the Registrar nor the City shall be
affected by any notice to the contrary. Neither the Registrar nor the City shall have any responsibility
191
or obligation to any Participant, any Person claiming a beneficial ownership interest in the Bonds under
or through DTC or any Participant, or any other Person which is not shown on the Bond register as
being a registered owner of any Bonds, with respect to the accuracy of any records maintained by
DTC or any Participant, with respect to the payment by DTC or any Participant of any amount with
respect to the principal of or interest on the Bonds, with respect to any notice which is permitted or
required to be given to owners of Bonds under this Resolution, with respect to the selection by DTC or
any Participant of any person to receive payment in the event of a partial redemption of the Bonds, or
with respect to any consent given or other action taken by DTC as registered owner of the Bonds. So
long as any Bond is registered in the name of Cede & Co., as nominee of DTC, the Registrar shall pay
all principal of and interest on such Bond, and shall give all notices with respect to such Bond, only to
Cede & Co. in accordance with the Representation Letter, and all such payments shall be valid and
effective to fully satisfy and discharge the City's obligations with respect to the principal of and interest
on the Bonds to the extent of the sum or sums so paid. No Person other than DTC shall receive an
authenticated Bond for each separate stated maturity evidencing the obligation of the City to make
payments of principal and interest. Upon delivery by DTC to the Registrar of written notice to the
effect that DTC has determined to substitute a new nominee in place of Cede & Co., the Bonds will be
transferable to such new nominee in accordance with paragraph (e) hereof.
(c) In the event the City determines that it is in the best interest of the Beneficial Owners that
they be able to obtain Bonds in the form of Bond certificates, the City may notify DTC and the
Registrar, whereupon DTC shall notify the Participants of the availability through DTC of Bonds in the
form of certificates. In such event, the Bonds will be transferable in accordance with paragraph (e)
hereof. DTC may determine to discontinue providing its services with respect to the Bonds at any time
by giving notice to the City and the Registrar and discharging its responsibilities with respect thereto
under applicable law. In such event the Bonds will be transferable in accordance with paragraph (e)
hereof.
(d) The Representation Letter sets forth certain matters with respect to, among other things,
notices, consents and approvals by registered owners of the Bonds and Beneficial Owners and
payments on the Bonds. The Registrar shall have the same rights with respect to its actions thereunder
as it has with respect to its actions under this resolution.
(e) In the event that any transfer or exchange of Bonds is permitted under paragraph (b) or (c)
hereof, such transfer or exchange shall be accomplished upon receipt by the Registrar of the Bonds to
be transferred or exchanged and appropriate instruments of transfer to the permitted transferee in
accordance with the provisions of this resolution. In the event Bonds in the form of certificates are
issued to owners other than Cede & Co., its successor as nominee for DTC as owner of all the Bonds,
or another securities depository as owner of all the Bonds, the provisions of this Resolution shall also
apply to all matters relating thereto, including, without limitation, the printing of such Bonds in the form
of Bond certificates and the method of payment of principal of and interest on such Bonds in the form of
Bond certificates.
In
Section 3. District Fund; Assessments.
3.01. District Fund. There is hereby created and established the District Fund designated as
the "Special Improvement District No. 343 Fund," which shall be maintained by the Finance Officer on
the books and records of the City separate and apart from all other funds of the City. Within the
District Fund there shall be maintained four separate accounts, designated as the "Construction
Account," "Principal Account," "Interest Account" and "District Reserve Account," respectively.
3.02. 'Construction Account. There shall be credited to the Construction Account certain
proceeds of the sale of the Bonds as provided in Section 2.07. Any earnings on investment of money in
the Construction Account shall be retained therein. All costs and expenses of constructing the
Improvements to be paid from proceeds of the Bonds shall be paid from time to time as incurred and
allowed from the Construction Account in accordance with the provisions of applicable law, and money
in the Construction Account shall be used for no other purpose- provided that upon completion of the
Improvements and after all claims and expenses with respect to the 1[mprovements have been fully paid
and satisfied, any money remaining in the Construction Account shall be transferred to the Principal
Account and used to redeem Bonds as provided in Section 3.03.
3.03. Principal Account and Interest Account. Money in the Principal Account and the
Interest Account shall be used only for payment of the principal of and interest on the Bonds as such
payments become due or to redeem Bonds. From the proceeds of the Bonds, there shall be deposited
in the Interest Account any interest on the Bonds accrued to the date of their delivery. Interest income
on funds in the Accounts shall be retained therein and used as any other funds therein.
Upon collection of the installment of principal and interest due on November 30 and May 31
of each fiscal year on the special assessments to be levied with respect to the Improvements, the
Finance Officer shall credit to the Interest Account so much of said special assessments as is collected
as interest payment and the balance thereof to the Principal Account. Any installment of any special
assessment paid prior to its due date with interest accrued thereon to the next succeeding interest
payment date shall be credited with respect to principal and interest payments in the same manner as
other assessments are credited to the District Fund. All money in the Interest Account and the Principal
Account shall be used first to pay interest due, and any remaining money shall be used to pay Bonds
then due and, if money is available,, to redeem Bonds in accordance with Section 2.05; provided that
any money transferred to a Principal Account from the Construction Account pursuant to Section 3.02
shall be applied to redeem Bonds to the extent possible on the next interest payment date for which
notice of redemption may properly be given pursuant to Section 2.05. Redemption of Bonds shall be
as provided in Section 2.05, and interest shall be paid as accrued thereon to the date of redemption, in
accordance with the provisions of Section 7-12-4206 of the Act.
3.04. District Reserve Account. Money in the District Reserve Account shall be applied on
any interest payment date to payment of principal of and interest on the Bonds at the
stated maturity thereof if funds on hand in the Principal Account and the Interest Account are insufficient
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therefor. Funds in the District Reserve Account must be used for such purpose before a loan is made
by the Revolving Fund therefor. If money is on hand in the District Reserve Account and all Bonds
have been paid or discharged as provided in Section 7, such money shall be transferred to the
Revolving Fund, as required by Section 7-12-4169(3).
3.05. Loans from Revolving Fund. The Council shall annually or more often if necessary
issue an order authorizing a loan or advance from the Revolving Fund to the District Fund in an amount
sufficient to make good any deficiency then existing in the Interest Account and shall issue an order
authorizing a loan or advance from the Revolving Fund to the District Fund in an amount sufficient to
make good any deficiency then existing in the Principal Account in such order and in each case to the
extent that money is available in the Revolving Fund- provided, however, that at the time any such loan
or advance is to be made, the District Reserve Account shall have been or shall be depleted on the next
interest payment date. A deficiency shall be deemed to exist in the Principal Account or the Interest
Account if the money on deposit therein, together with any funds on deposit in the District Reserve
Account, on any December 15 or June 15 (excluding amounts in the Principal Account representing
prepaid special assessments) is less than the amount necessary to pay Bonds due (other than upon
redemption), and interest on all Bonds payable, on the next succeeding interest payment date.
Pursuant to Ordinance No. 759, the City has undertaken and agreed to provide funds for the
Revolving Fund by levying such tax or making such loan from the General Fund as authorized by
Montana Code Annotated, Section 7-12-4222. In the event that the balance on hand in the Revolving
Fund fifteen days prior to any date when interest is due on special improvement district bonds or
warrants of the City is not sufficient to make good all deficiencies then existing in the special
improvement district funds for which the City has covenanted to make loans from the Revolving Fund,
the balance on hand in the Revolving Fund shall be allocated to the funds of the special improvement
districts in which such deficiencies then exist in proportion to the amounts of the deficiencies on the
respective dates of receipt of such money, until all interest accrued on such special improvement district
bonds or warrants of the City has been paid. On any date when all accrued interest on special
improvement district bonds and warrants of the City payable from funds for which the City has
covenanted to make loans from the Revolving Fund has been paid, any balance remaining in the
Revolving Fund shall be lent or advanced to the special improvement district funds for payment and
redemption of bonds to the extent the special improvement district funds are deficient for such purpose,
and, if money in the Revolving Fund is insufficient therefor, pro rata, in an amount proportionate to the
amount of such deficiency.
The City hereby determines, covenants and agrees to levy the property tax described in the
immediately preceding paragraph to provide funds for the Revolving Fund so long as any Bonds are
outstanding to the extent required under the provisions of this Resolution and the Act, even though such
property tax levy may, under applicable law (including SB 184, adopted by the Montana Legislature in
1999) or provisions of the home rule charter of the City, require that property tax levies of the City for
other purposes be reduced correspondingly.
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Section 4. Covenants. The City covenants and agrees with the owners ftorn time to time of
each of the Bonds that until all the Bonds and interest thereon are fully paid:
4.01. Compliance with Resolution. The City will hold the District Fund and the Revolving
Fund as trust funds, separate and apart from all of its other funds, and the City, its officers and agents,
will comply with all covenants and agreements contained in this resolution. The provisions hereinabove
made with respect to the District Fund and the Revolving Fund are in accordance with the undertaking
and ageement of the City made in connection with the public offering of the Bonds and the sale of the
Bonds as set forth in Section 1.06.
4.02. Construction of hIlprovements. The City will do all acts and things necessary to
enforce the provisions of the construction contracts and bonds referred to in Section 1.04 and to ensure
the completion of the Improvements for the benefit of the District in accordance with the plans and
specifications and within the time therein provided, and will pay all costs thereof promptly as incurred
and allowed, out of the District Fund and within the amount of the proceeds of the Bonds appropriated
thereto.
4.03. Leyy of Assessments. The City will do all acts and things necessary for the final and
valid levy of special assessments upon all assessable real property within the boundaries of the District
in accordance with the Constitution and laws of the State of Montana and the Constitution of the United
States, in an aggregate principal amount not less than $1,581,500. Such special assessments shall be
levied on the basis or bases prescribed in the Resolution of Intention, and shall be payable in equal,
semiannual installments over a period of 20 years, with interest on the whole amount remaining unpaid
at an annual rate equal to the sum of: (i) the average annual interest rate borne by the Bonds, plus (ii)
one-half of one percent (0.50%) per annum, interest being payable with principal installments. The
assessments to be levied will be payable on the 30th day of November in each of the years 2001
through 2020, and on the 3 1 st day of May in the years 2002 through 202 1, inclusive, if not theretofore
paid, and shall become delinquent on such date unless paid in fall. The first partial payment of each
assessment shall include interest on the entire assessment from the date of original registration of the
Bonds to January 1, 2002 and each subsequent partial payment shall include interest for six months on
that payment and the then remaining balance of the special assessment. The assessments shall
constitute a lien upon and against the property against which they are made and levied, which lien may
be extinguished only by payment of the assessment with all penalties, cost and interest as provided in
Montana Code Annotated, Section 7-12-419 1. No tax deed issued with respect to any lot or parcel
of land shall operate as payment of any installment of the assessment thereon which is payable after the
execution of such deed, and, any tax deed so issued shall convey title subject only to the lien of said
fature installments, as provided in Montana Code Annotated, Section 15-18-214.
4.04. Reassessment. If at any time and for whatever reason any special assessment or tax
herein agreed to be levied is held invalid, the City and this Council, its officers and employees, will take
all steps necessary to correct the same and to reassess and re -levy the same, including the ordering of
work, with the same force and effect as if made at the time provided by law, ordinance or resolution
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relating thereto, and will reassess and re -levy the same with the same force and effect as an original levy
thereof, as authorized in Montana Code Annotated, Section 7-12-4186. Any special assessment, or
reassessment or re -levy shall, so far as is practicable, be levied and collected as it would have been if
the first levy had been enforced including the levy and collection of any interest accrued on the first levy.
If proceeds of the Bonds, including investment income thereon, are applied to the redemption
of such Bonds, as provided in Montana Code Annotated, Sections 7-12-4205 and 7-12-4206, or if
refimding bonds are issued and the principal amount of the outstanding Bonds of the District is
decreased or increased, the City will reduce or increase, respectively, the assessments levied in the
District and then outstanding pro rata by the principal amount of such prepayment or the increment
above or below the outstanding principal amount of bonds represented by the refunding bonds. The
City and this Council, its officers and employees will reassess and re -levy such assessments, with the
same effect as an original levy, in such reduced or increased amounts in accordance with the provisions
of Montana Code Annotated, Sections 7-12-4176 through 7-12-4178.
4.05. Absence of Litigation. There is now no litigation pending or, to the best knowledge of
the City, threatened questioning the validity or regularity of the creation of the District, the contracts for
construction of the Improvements or the undertaking and agreement of the City to levy special
assessments therefor and to make good any deficiency in the collection thereof through the levy of taxes
for and the making of advances from the Revolving Fund, or the right and power of the City to issue the
Bonds or in any manner questioning the existence of any condition precedent to the exercise of the
City's powers in these matters. If any such litigation should be initiated or threatened, the City will
forthwith notify in writing the Purchaser, and will famish the Purchaser a copy of all documents,
including pleadings, in connection with such litigation.
4.06. Waiver of Penalty. "and interest. The City covenants not to waive the payment of
penalty or interest on delinquent assessments levied on property in the District for costs of the
Improvements, unless the City determines, by resolution of the City Council, that such waiver is in the
best interest of the owners of the outstanding Bonds.
Section 5. Tax Matters.
5.01. Use of 1=rovements. The Improvements will be owned and operated by the City
and available for use by members of the general public on a substantially equal basis. The City shall not
enter into any lease, use or other agreement with any non -governmental person relating to the use of the
Improvements or security for the payment of the Bonds which might cause the Bonds to be considered
"Private activity bonds" or "Private loan bonds" within the meaning of Section 141 of the Internal
Revenue Code of 1986, as amended (the "Code").
5.02. General Covenant. The City covenants and agrees with the owners from time to time
of the Bonds that it will not take or permit to be taken by any of its officers, employees or agents any
action which would cause the interest on the Bonds to become includable in gross income for federal
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income tax purposes under the Code and applicable Treasury Regulations applicable to the Bonds and
promulgated under the Code, including, without limitation, Treasury Regulations (the "Regulations"),
and covenants to take any and all actions within its powers to ensure that the interest on the Bonds will
0
not become includable in gross income for federal
income tax purposes under the Code and the Regulations.
5.03. Arbitrnre Certification. The Mayor, the City Manager and the Finance Officer, being
the officers of the City charged with the responsibility for issuing the Bonds pursuant to this resolution,
are authorized and directed to execute and deliver to the Purchaser a certificate in accordance with the
provisions of Section 148 of the Code, and Section 1. 148-2(b) of the Regulations, stating that on the
basis of facts, estimates and circumstances in existence on the date of issue and delivery of the Bonds, it
is reasonably expected that the proceeds of the Bonds will be used in a manner that would not cause
the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code and the Regulations.
5.04. Arbitrage. Rebate Exelnption.
(a) The City hereby represents that the Bonds qualify for the exception for small governmental
units to the arbitrage rebate provisions contained in Section 148(f) of the Code. Specifically, the City
represents:
(1) Substantially all (not less than 95%) of the proceeds of the Bonds (except for amounts to
be applied to the payment of costs of issuance and amounts to be deposited in the Interest
Account pursuant to Section 3.03) will be used for local governmental activities of the City.
(2) The aggregate face amount of all "tax-exempt bonds" (including warrants, contracts,
leases and other indebtedness, but excluding private activity bonds) issued by or on behalf of
the City and all subordinate entities thereof during 2001 is reasonably expected not to exceed
$5,000,000. To date in 2001 . the City has issued no such tax-exempt bonds, and in the
calendar years 1996 through 2000, the City issued no tax-exempt bonds, except for
$1,060,000 Water System Revenue Bonds, Series 1996, and $925,000 Sewerage System
Refunding Revenue Bonds, Series 1997.
(b) If notwithstanding the provisions of paragraph (a) of this Section 5.04, the arbitrage rebate
provisions of Section 148(f) of the Code apply to the Bonds, the City hereby covenants and agrees to
make the determinations, retain records and rebate to the United States the amounts at the times and in
the manner required by said Section 148(f).
5.05. "Quali led Tax-Expmt ObIwations." Pursuant to Section 265(b)(3)(B)(ii) of the
Code, the City hereby designates the Bonds as "qualified tax-exempt obligations" for purposes of
Section 265(b)(3) of the Code. The City has not designated any obligations in 2001 other than the
Bonds under Section 265(b)(3), except the City anticipates issuing a $761,000 Water System Revenue
Bond in June 2001, and after the date of this resolution. The City hereby represents that it does not
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anticipate that obligations bearing interest not includable in gross income for purposes of federal income
taxation under Section 103 of the Code (including refunding obligations as provided in Section
265(b)(3) of the Code and including 4'qualified 501(c)(3) Bonds" but excluding other "pn*vate activity
bonds," as defined in Sections 141 (a) and 145(a) of the Code) will be issued by or on behalf of the
City and all "subordinate entities" of the City in 2001 in an amount greater than $ 10,000,000.
5.06. 'Information Reporting. The City shall file with the Secretary of the Treasury, not later
than August 15, 2001, a statement concerning the Bonds containing the information required by Section
149(e) of the Code.
Section 6. Authentication of Trans . The officers of the City are hereby authon*zed and
directed to furnish to the Purchaser and to bond counsel certified copies of all proceedings relating to
the issuance of the Bonds and such other certificates and affidavits as may be required to show the
right, power and authority of the City to issue the Bonds, and all statements contained in and shown by
such instruments, including any heretofore furnished, shall constitute representations of the City as to the
truth of the statements purported to be shown thereby.
Section 7. Discharize.
7.01. General. When the liability of the City on all Bonds issued under and secured by this
resolution has been discharged as provided in this Section 7, all pledges, covenants and other rights
granted by this resolution to the owners of such obligations shall cease.
7.02. PgMent. The City may discharge its liability with reference to any Bond or installment
of interest thereon which is due on any date by on or before that date depositing with the Registrar
funds sufficient, or, if a City officer is the Registrar, mailing to the registered owner of such Bond a
check or draft in a sum sufficient and providing proceeds available, for the payment thereof in full; or if
any Bond or installment of interest thereon shall not be paid when due, the City may nevertheless
discharge its liability with reference thereto by depositing with the Registrar funds sufficient, or, if a City
officer is the Registrar, by mailing to the registered owner thereof a check or draft in a sum sufficient
and providing proceeds available, for the payment thereof in fall with interest accrued to the date of
such deposit or mailing.
7.03. Prgpayment. The City may also discharge its obligations with respect to any Bonds
called for redemption on any date when they are prepayable according to their terms, by on or before
that date depositing with the Registrar funds sufficient, or, if a City officer is the Registrar, mailing to the
registered owner of such Bond a check or a draft in a sum sufficient and providing proceeds available,
for the payment of the principal, interest and redemption premium, if any, which are then due; provided
that notice of such redemption has been duly given as provided herein or irrevocably provided for.
7.04. Escrow. The City may also at any time discharge its liability in its entirety with
reference to the Bonds, subject to the provisions of law now or hereafter authorizing and regulating
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such action, by depositing irrevocably in escrow, with a bank qualified by law as an escrow agent for
this purpose, cash or securities which are authorized by law to be so deposited, bearing interest
payable at such times and at such rates and maturing on such dates as shall be required, without
reinvestment, to provide funds sufficient to pay all principal and interest to become due on all Bonds on
or before maturity or, if any Bond has been duly called for redemption or notice of such redepiption has
been irrevocably provided for, on or before the designated redemption date.
Section 8. 'Continuing Disclosure.
8.01. PgMose and Beneficiaries. To provide for the public availability of certain information
relating to the Bonds and the security therefor and to permit the ori ginal purchaser and other
participating underwriters in the primary offering of the Bonds to comply with amendments to Rule
15c2-12 promulgated by the Securities and Exchange Commission (the "SEC") under the Securities
Exchange Act of 1934 (17 C.F.R. § 240.15c2-12), relating to continuing disclosure (as in effect and
interpreted from time to time, the "Rule"), which will enhance the marketability of the Bonds, the City
hereby makes the following covenants and agreements for the benefit of the Owners (as hereinafter
defined) from time to time of the Outstanding Bonds. The City, the District and the Revolving Fund of
the City are the only "obligated persons" in respect of the Bonds within the meaning of the Rule for
purposes of identifying the entities in respect of which continuing disclosure must be made.
If the City fails to comply with any provisions of this Section 8, any person aggrieved thereby,
including the Owners of any Outstanding Bonds, may take whatever action at law or in equity may
appear necessary or appropriate to enforce performance and observance of any agreement or
covenant contained in this Section 8. including an action for a wn't of mandamus or specific
perfon-nance. Direct, indirect, consequential and punitive damages shall not be recoverable for any
default hereunder. Notwithstanding anything to the contrary contained herein, in no event shall a default
under this Section 8 constitute a default�under the Bonds or under any:other provision of this resolution.
As used in this Section 8, "Owner" or "Bondowner" means, in respect of a Bond, the
registered owner or owners thereof appearing in the bond register maintained by the Registrar or any
"Beneficial Owner" (as hereinafter defined) thereof, if such Beneficial Owner provides to the Registrar
e *dence of such beneficial ownership in form and substance reasonably satisfactory to the Registrar.
vi
As used herein, "Beneficial Owner" means, in respect of a Bond, any person or entity which (a) has the
power, directly or indirectly,, to vote or consent with respect to, or to dispose of ownership of, such
Bond (including persons or entities holding Bonds through nominees, depositories or other
intermediaries), or (b) is treated as the owner of the Bond for federal income tax purposes.
8.02 Information to be Disclosed. The City will provide, in the manner set forth in subsection
8.03 hereof, either directly or indirectly through an agent designated by the City, the following
information at the following times:
(a) on or before 270 days after the end of each fiscal year of the City, commencing with the
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fiscal year ending June 30, 2002, the following financial information and operating data in respect of the
City (the "Disclosure Information"):
(1) the audited financial statements of the City for such fiscal year,
accompanied by the audit report and opinion of the accountant or government auditor
relating thereto, as permitted or required by the laws of the State of Montana,
containing the balance sheets as of the end of such fiscal year and a statement of
operations, changes in fund balances and cash flows for the fiscal year then ended for
required funds, prepared in accordance with generally accepted accounting principles
promulgated by the Financial Accounting Standards Board as modified in accordance
with the governmental accounting standards promulgated by the Governmental
Accounting Standards Board or as otherwise provided under Montana law, as in effect
from time to time, or, if and to the extent such financial statements have not been
prepared in accordance with such generally accepted accounting principles for reasons
beyond the reasonable control of the City, noting the discrepancies therefrom and the
effect thereof, and certified as to accuracy and completeness in all material respects by
the City Finance Officer; and
(2) To the extent not included in the financial statements referred to in
paragraph (1) hereof, the information of the type set forth below, which information
may be unaudited, but is to be certified as to accuracy and completeness in all material
respects by the City Finance Officer to the best of his or her knowledge, which
certification may be based on the reliability of information obtained fTom third party
sources*.
(A) updated information for the then most recent completed fiscal year
in format similar to the table in the section captioned "Revolving Fund" in the
Official Statement of the City, dated May 25, 2001 (the "Official Statement"),
concerning the Revolving Fund Cash Balance and outstanding bonds secured
thereby;
(B) a description of any special improvement district bonds issued
during the then most recent completed fiscal year;
(C) updated information for the then most recent completed fiscal year
in format similar to the table in the section captioned "Special Assessment
Billings and Collections" in the Official Statement;
(D) updated information for the then most recent completed fiscal year
in format similar to the table in the section captioned "Statement of Changes in
Fund Balance of the Revolving Fund", in the Official Statement-,
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(E) the market and taxable valuations of the City for the then current
fiscal year; and
(F) tax collection information for the then most recent completed fiscal
year in format similar to the table in the section captioned "Tax Collections" in
Appendix A to the Official Statement.
Notwithstanding the foregoing paragraph, if the audited financial statements are not available by
the date specified, the City shall provide on or before such date unaudited financial statements in the
format required for the audited financial statements as part of the Disclosure Infon-nation and, within ten
days after the receipt thereof, the City shall provide the audited financial statements.
Any or all of the Disclosure Information may be incorporated by reference, if it is updated as
required hereby, from other documents, including official statements, which have been submitted to
each of the repositories hereinafter referred to under subsection 8.03 or the SEC. If the document
incorporated by reference is a final official statement,, it must be available from the Municipal Securities
Rulemaking Board. The City shall clearly identify in the Disclosure Information each document so
incorporated by reference.
If any part of the Disclosure Information can no longer be generated because the operations of
the District or the City have materially changed or been discontinued, such Disclosure Information need
no longer be provided if the City includes in the Disclosure Information a statement to such effect;
provided, however, if such operations have been replaced by other City operations in respect of which
data is not included in the Disclosure Information and the City determines that certain specified data
regarding such replacement operations would be a Material Fact (as defined in paragraph (b) hereof),
then, from and after such determination, the Disclosure Information shall include such additional
specified data regarding the replacement operations.
If the Disclosure Information is changed or this Section 8 is amended as permitted by this
paragraph 8.02(a) or subsection 8.04, then the City shall include in the next Disclosure Information to
be delivered hereunder, to the extent necessary, an explanation of the reasons for the amendment and
the effect of any change in the type of financial information or operating data provided. Such
explanation shall include any change in the accounting principles pursuant to which the financial
statements constituting a portion of the Disclosure Information are prepared.
(b) In a timely manner, notice of the occurrence of any of the following events which is a
Material Fact (as hereinafter defined):
(1) Principal and interest payment delinquencies;
(2) Non-payment related defaults;
(3) Unscheduled draws on debt service reserves reflecting financial
difficulties;
M16
(4) Unscheduled draws on credit enhancements reflecting financial
difficulties-,
(5) Substitution of credit or liquidity providers, or their failure to
perform;
(6) Adverse tax opinions or events affecting the tax-exempt status of
the security;
(7) Modifications to rights of security holders;
(8) Bond calls-,
(9) Defeasances;
(10) Release, substitution, or sale of property securing repayment of
the secun*ties; and
(11) Rating changes.
As used herein, a "Material Fact" is a fact as to which a substantial likelihood exists that a
reasonably prudent investor would attach importance thereto in deciding to buy, hold or sell a Bond or,
if not disclosed, would significantly alter the total information otherwise available to an investor from the
Official Statement, information disclosed hereunder or information generally available to the public.
Notwithstanding the foregoing sentence, a "Material Fact" is also an event that would be deemed
".material" for purposes of the purchase, holding or sale of a Bond within the meaning of applicable
federal securities laws, as interpreted at the time of discovery of the occurrence of the event.
(c) In a timely manner, notice of the occurrence of any of the following events or conditions:
(1) the failure of the City to provide the Disclosure Information required under
paragraph 8.02(a) at the time specified thereunder;
(2) the amendment or supplementing of this Section 8 pursuant to subsection
8.04, together with a copy of such amendment or supplement and any explanation
provided by the City under subsection 8.04(b),
(3) the tennination of the obligations of the City under this Section 8 pursuant
to subsection 8.04; and
(4) any change in the fiscal year of the City.
8.03 Manner of Disclosure. The City agrees to make available the information described in
subsection 8.02 to the following entities by telecopy, overnight delivery, mail or other means, as
appropriate:
(a) the information described in paragraphs (a) of subsection 8.02, to each then nationally
recognized municipal securities information repository under the Rule and to any state information
_19-
depository then designated or operated by the State of Montana as contemplated by the Rule (the
"State Depository"'), if any,*
(b) the information described in paragraphs (b) and (c) of subsection 8.02, to the Municipal
Securities Rulemaking Board and to the State Depository, if any; and
(c) the infon-nation described in subsection 8.02, to any rating agency then maintaining a rating
of the Bonds and, at the expense of such Bondowner, to any Bondowner who requests in writing such
information, at the time of transmission under paragraphs (a) or (b) of this subsection 8.03, as the case
may be, or, if such information is transmitted with a subsequent time of release, at the time such
information is to be released.
8.04 Tenn-, Amendments-, Interpretation.
(a) The covenants of the City in this Section 8 shall remain in effect so long as any Bonds are
Outstanding.
(b) This Section 8 (and the form and requirements of the Disclosure Information) may be
amended or supplemented by the City from time to time, without notice to (except as provided in
paragraph 8.03(c) hereof) or the consent of the Owners of any Bonds, by a resolution of this Council
filed in the office of the recording officer of the City accompanied by an opinion of Bond Counsel, who
may rely on certificates of the City and others and the opinion may be subject to customary
qualifications, to the effect that such amendment or supplement (A) is made in connection with a change
in circumstances that arises from a change in law or regulation or a change in the identity,, nature or
status of the City, District or the District Fund and the Revolving Fund of the City or the type of
operations conducted by the City or the District, or (B) is required by, or better complies with, the
provisions of paragraph (b)(5) of the Rule, assuming that such provisions apply to the Bonds.
If the Disclosure Information is so amended, the City agrees to provide, contemporaneously
with the effectiveness of such amendment, an explanation of the reasons for the amendment and the
effect, if any, of the change in the type of financial information or operating data being provided
hereunder.
(c) This Section 8 is entered into as a continuing disclosure undertaking to provide continuing
disclosure identical to that required by the continuing disclosure provisions of the Rule and should be
construed so the undertaking would satisfy the requirements of paragraph (b)(5) of the Rule, assuming it
was otherwise applicable to the Bonds.
8.05 Further Limitation of Liability of City. In and to the extent the limitations of liability
contained in subsection 8.01 are not effective, anything contained in this Section 8 to the contrary
notwithstanding, in making the agreements, provisions and covenants set forth in this Section 8, the City
has not obligated itself except with respect to the assessments and the Revolving Fund. None of the
W112
agreements or obligations of the City contained herein shall be construed to constitute an indebtedness
of the City within the meaning of any constitutional or statutory provisions whatsoever or constitute a
pledge of the general credit or taxing powers of the City.
Section 9. Rgpeals and Effective Date.
9.01. Roeal. All provisions of other resolutions and other actions and proceedings of the City
and this Council that are in any way inconsistent with the terms and provisions of this resolution are
repealed, amended and rescinded to the fall extent necessary to give full force and effect to the
provisions of this resolution.
9.02. Effective Date. This resolution shall take effect immediately upon its passage and
adoption by this Council.
PASSED by the City Council of the City of Kalispell, Montana, this 4th day of June, 2001.
Attest:
City Clerk
:g�SEAL)
CORPOPATE
SEAL
OF W�
IN-80
wml-bm nip**t
Mayor
EXHIBIT A
[Face of the Bond]
UNITED STATES OF AMERICA
STATE OF MONTANA
COUNTY OF FLATHEAD
CITY OF KALISPELL
SPECIAL IMPROVEMENT
DISTRICT NO. 343 BOND
Interest at the rate per annum specified below
payable January 1, 2002 and
semiannually thereafter
on the I st day of January and the I st day of July in each year.
No.
Date of Original
Rate Maturit Issue CUSIP
% July 1, June 1', 2001
REGISTERED OWNER:
PRINCIPAL AMOUNT: DOLLARS
FOR VALUE RECEIVED, the City of Kalispell, Flathead County, Montana, will pay to the
registered owner identified above, or registered assigns, on the maturity date specified above the
principal amount specified above, solely from the revenues hereinafter specified, as authorized by
Resolution No. 4622 adopted June 4, 2001 (the "Resolution"), all subject to the provisions hereinafter
described relating to the redemption of this Bond before maturity. This Bond bears interest at the rate
per annurn specified above from the date of registration of this Bond, as expressed herein,, or ftom such
later date to which interest hereon has been paid or duly provided for, until the maturity date specified
above or an earlier date on which this Bond shall have been duly called for redemption by the City
A-1
Finance Officer. Interest on this Bond is payable semiannually, commencing January 1, 2002, on the
first day of January and the first day of July in each year, to the owner of record of this Bond appearing
as such in the bond register as of the close of business on the 15th day (whether or not such is a
business day) of the immediately preceding month. Interest on and, upon presentation and surrender
hereof at the operations center of the bond registrar and paying agent hereinafter named, the principal
of this Bond are payable by check or draft of U.S. Bank Trust National Association MT, as Bond
Registrar, Transfer Agent and Paying Agent, at its operations center in St. Paul, Minnesota, or its
successor designated under the Resolution (the "Registrar"). The principal of and interest on this Bond
are payable in lawful money of the United States of America.
Notwithstanding any other provisions of this Bond, so long as this Bond is registered in the
name of Cede & Co., as nominee of The Depository Trust Company, or in the name of any other
nominee of The Depository Trust Company or other securities depository, the Registrar shall pay all
principal of and interest on this Bond, and shall give all notices with respect to this Bond, only to Cede
& Co. or other nominee in accordance with the operational arrangements of The Depository Trust
Company or other securities depository as agreed to by the City.
This Bond is one of an issue in the aggregate principal amount of $1,581,500 (the "Bonds"),
all of like date of original issue and tenor, except as to serial number, denomination, date, interest rate
and maturity date. The Bonds are issued pursuant to and in full conformity with the Constitution and
laws of the State of Montana thereunto enabling, including Montana Code Annotated, Title 7, Chapter
12,, Parts 41 and 42, as amended (the "Act"), to finance the costs of certain local improvements (the
"Improvements") for the special benefit of property located in Special Improvement District No. 343 of
the City (the "District"). The Bonds are issuable only as fully registered bonds of single maturities in
denominations of $5,000 or any integral multiple thereof, except that the Bond with a stated maturity in
2002 shall be in the principal amount of $6,500.
This Bond is payable from the collection of a special tax or assessment levied upon all
assessable real property within the boundaries of the District, in an aggregate principal amount of not
less than $ 1 � 5 8 11) 5 00 , except as such amount may b e reduced or increas ed in accordance with
provisions of Montana law. Such assessments constitute a lien against the assessable real estate within
the District and are to be deposited into the Special Improvement District No. 343 Fund of the City
(the "District Fund"). The City has established in the District Fund, and fimded with certain proceeds
of the Bonds, a District Reserve Account (the "Reserve Account"), from which moneys are to be
applied to pay principal of and interest on the Bonds in the event collections of special assessments are
insufficient therefor. There is no obligation for the City to replenish the Reserve Account if funds are
withdrawn therefrom. The Bonds are not general obligations of the City.
The City has also validly established a Special Improvement District Revolving Fund (the
"Revolving Fund") to secure the payment of certain of its special improvement district bonds, including
the Bonds. The City has also agreed, to the extent permitted by the Act, to issue orders annually
authorizing loans or advances from the Revolving Fund to the District Fund, in amounts sufficient to
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make good any deficiency in the District Fund to pay principal of or interest on the Bonds after
depletion of the Reserve Account, to the extent that ftmds are available in the Revolving Fund, and to
provide funds for the Revolving Fund by annually making a tax levy or loan from its general fund in an
amount sufficient for that purpose, subject to the limitation that no such tax levy or loan may in any year
cause the balance in the Revolving Fund to exceed five percent of the principal amount of the City's
then outstanding special improvement district bonds secured thereby and the durational limitations
specified in the Act. While any property tax levy to be made by the City to provide funds for the
Revolving Fund is subject to levy limits under current law, the City has agreed in the Resolution to levy
property taxes to provide funds for the Revolving Fund to the extent described in this paragraph and, if
necessary, to reduce other property tax levies correspondingly to meet applicable levy limits.
The Bonds are subject to mandatory redemption in order of stated maturities and within a
stated maturity in $5,000 principal amounts selected by lot or other manner deemed fair by the
Registrar,, except that the Bond with a stated maturity in 2002 and in the principal amount of $6,500
shall be redeemed before other Bonds of such stated maturity, on any interest payment date if, after
paying all principal and interest then due on the Bonds, there are funds to the credit of the District Fund,
ftom the prepayment of assessments levied in the District or from surplus proceeds of the Bonds not
required to pay costs of the Improvements, for the redemption thereof, and in the manner provided for
the redemption of the same. The Bonds are subject to redemption at the option of the City from other
sources of funds available therefor on any interest payment date,; provided, however, that the City
hereby agrees not to redeem the Bonds from (i) amounts on deposit in the Reserve Account in the
District Fund or (ii) the proceeds of refunding special improvement district bonds prior to July 1, 2006.
The redemption price is equal to the principal amount of the Bonds or portions thereof to be redeemed
plus interest accrued thereon to the date of redemption. The date of redemption and principal amount
shall be fixed by the City Finance Officer, who shall give notice thereof to the Registrar in sufficient time
for the Registrar to give notice, by first class mail, postage prepaid, or by other means required by the
securities depository, to the owner or owners of such Bonds at their addresses shown on the bond
register, of the Bonds or portions thereof to be redeemed and the date on which payment will be made,
which date shall not be less than thirty (30) days after the date of mailing of notice, on which date so
fixed interest shall cease. On the date so fixed interest on the Bonds or portions thereof so redeemed
shall cease to accrue. Upon partial redemption of any Bond, a new Bond or Bonds will be delivered to
the registered owner without charge, representing the remaining principal amount outstanding.
The Bonds have been designated by the City as "qualified tax-exempt obligations"
pursuant to Section 265 of the Internal Revenue Code of 1986, as amended.
As provided in the Resolution and subject to certain limitations set forth therein, this Bond
is transferable upon the books of the City at the operations center of the Registrar, by the registered
owner hereof in person or by his attorney duly authorized in writing upon surrender hereof together with
a written instrument of transfer satisfactory to the Registrar, duly executed by the registered owner or
his attorney; and may also be surrendered in exchange for Bonds of other authorized denominations.
Upon such transfer or exchange, the City will cause a new Bond or Bonds to be issued in the name of
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the transferee or registered owner, of the same aggregate principal amount, bearing interest at the same
rate and maturing on the same date, subject to reimbursement for any tax, fee or governmental charge
required to be paid with respect to such transfer or exchange.
The City and the Registrar may deem and treat the person in whose name this Bond is
registered as the absolute owner hereof, whether this Bond is overdue or not, for the purpose of
receiving payment and for all other purposes, and neither the City nor the Registrar shall be affected by
any notice to the contrary. I
IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all
things required to be done precedent to the issuance of this Bond have been properly done, happened
and been performed in the manner prescribed by the laws of the State of Montana and the resolutions
and ordinances of the City of Kalispell, Montana, relating to the issuance thereof; and that the opinion
attached hereto is a true copy of the legal opinion given by Bond Counsel with reference to the Bonds,
dated the date of original issuance and delivery of the Bonds.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Resolution until the Certificate of Authentication and Registration herein
shall have been executed by the Registrar by the manual signature of one of its authorized
representatives.
IN WITNESS WHEREOF, the City of Kalispell, Flathead County, Montana, by its City
Council,, has caused this Bond to be executed by the facsimile signatures of the Mayor, City Manager
and the Finance Officer, and by a facsimile of the official seal of the City.
(Facsimile Seal)
E A
(Facsimile Signature)
Mayor
(Facsimile Signature)
City Manager
(Facsimile Signature)
Finance Officer
Dated:
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds delivered pursuant to the Resolution mentioned within.
U.S. BANK TRUST NATIONAL
ASSOCIATION MT,
as Bond Registrar, Transfer Agent,
and Paying Agent
VA
Authorized Signature
The following abbreviations, when used in the inscription on the face of this Bond, shall be
construed as though they were written out in full according to applicable laws or regulations:
TEN COM -- as tenants
4
in conunon
TEN ENT -- as tenants
UTMA ........ Custodian ......
(Cust) (Minor)
by the entireties
under Unifonn Transfers
JT TEN -- as joint tenants to Minors Act ....................
w *th *ght of
i n (State)
survivorship and
not as tenants in
conunon
Additional abbreviations may also be used.
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ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
the within Bond and all rights thereunder,
and hereby irrevocably constitutes and appoints
attorney to transfer the within Bond on the books kept for registration
thereof, with full power of substitution in the premises.
Dated:
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE:
SIGNATURE GUARANTEED
Signature(s) must be guaranteed by an
"eligible guarantor institution" meeting
the requirements of the Bond Registrar,
which requirements include membership
or participation in STAMP or such other
44signature guaranty program" as may be
determined by the Bond Registrar in
addition to or in substitution for STAMP,
all in accordance with the Securities
Exchange Act of 1934, as amended.
"-% - re
NOTICE: The signature to this
assignment must correspond with
the name as it appears upon the
face of the within Bond in every
particular, without alteration,
enlargement or any change
whatsoever.
EXHIBIT B
Blanket Issuer Letter of Representations
[To be Completed by Issuer]
CITY OF KALISPELL, MONTANA
[Name of Issuer]
November 4,1996
[Date]
Attention: Underwriting Department — Eligibility
The Depository Trust Company
a " Water Street; 50th Floor
0
New York, NY 10041- 0099
Ladies and Gentlemen:
This letter sets forth our understanding with respect to all issues (the ""Securities"") that Issuer
shall request be made eligible for deposit.by The Depository Trust Company ("DTC"").
J
To induce DTC to accept the SecuAties as eligible for deposit at DTC, and to act in accordance
'Mth DTC's Rules vAth respect to the Secunities,, Issuer represents to DTC that Issuer will comply
vAth the requirements stated in DTC's Operational Arrangements, as they may be amended from
time to time.
Note:
Schedule A contains statements that DTC believes
accurate�v describe DTC, the method of effectin book -
entry transfers of securities distributed through DTC1, and
.f
mrtain related matters.
Received and Accepted:
Bv:
Of
Very truly yours,
CITY OF KALISPELL, MONTANA
By: (Issuer)
r " Signature)
(.A,Uthorized *s
Clarence Krepps, City 7anager
(Typewrite Name &- 1-itle)
312 - 1st Avenue East
(Street Address)
Kalispell, Montana 59901
(Citv) (State) (Zip)
1
(406) 758-7700
(Phone Number)