Resolution 4266 - Intent to Sell Bonds - Water System Improvements1313
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RESOLUTION NO. 4266
RESOLUTION RELATING TO $1,060,000 WATER SYSTEM REVENUE
BONDS, SERIES 1996; AUTHORIZING THE ISSUANCE AND
PROVIDING FOR THE PUBLIC SALE THEREOF
BE IT RESOLVED by the City Council (the "Council') of the City of
Kalispell, Montana (the "City"), as follows:
Section 1. Recitals. The City is authorized pursuant to Title 7, Chapter
7, Part 44, Montana Code Annotated to issue its revenue bonds to finance in whole
or in part the cost of the acquisition, purchase, construction, reconstruction,
improvement, betterment or extension of its water system facilities. The Council
investigated the facts necessary and hereby finds, determines and declares it to be
necessary and desirable for the City to offer for sale $1,060,000 Water System
Revenue Bonds, Series 1996 (the "Bonds") for the purpose of engineering,
designing, constructing, and installing certain improvements to the existing water
system and related improvements (the "Project") and for funding certain costs
incidental to the sale and payment of bonds and to establish the debt service reserve
securing the Bonds.
Section 2. Tenn of Bonds. Pursuant to the authority described above,
this Council shall issue and sell Bonds of the City in the aggregate principal amount
not to exceed $1,060,000 for the purpose of providing funds to construct and install
the Project, funding the debt service reserve, and paying certain costs incidental to
the sale and payment of the Bonds. The Bonds shall be dated, as originally issued, as
of June 15, 1996, shall be issued in one series designated Series 1996 and shall bear
interest, payable semiannually on January 1 and July 1 of each year commencing
January 1,1997, at the rate or rates designated by the successful bidder at public sale
and approved by the Council, which rate or rates shall not exceed seven and one-
half percent (7.501/6) per annum, with the maximum difference between the highest
and lowest rate of interest not exceeding three and one-half percent (3.50%) per
annum and must be expressed in integral multiples of 1/8 or 1/20 of 1%. No
supplemental or "B" coupon interest shall' be allowed. The Bonds shall mature on
July 1 in each of the following years and amounts:
Year Amount
1997
$45,000
1998
50,000
1999
55,000
2000
55,000
2001
60,000
2002
60,000
2003
65,000
2004
70,000
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Year Amount
2005
$ 75,000
2006
75,000
2007
80,000
2008
85,000
2009
90,000
2010
95,000
2011
100,000
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The Bonds shall be in the denomination of $5,000 each or any integral
multiple thereof of single maturities. The Bonds shall be issued only as fully
registered bonds and shall be executed by the manual or facsimile signatures of the
Mayor, City Manager and City Finance Director.
The Bonds with stated maturities in 2004 and later years are subject to
redemption at the option of the City selected by lot or other manner it deems fair
within single maturities on any business day after January 1, 2004, at a redemption
price expressed as a percentage of the principal amount of the Bonds, plus accrued
interest, according to the following schedule:
Red m tion Date Price
January 1, 2004 through December 31, 2004 102% _
January 1, 2005 through December 31, 2005 101%
January 1, 2006 and thereafter 100%
Further terms and conditions for the sale of the Bonds are contained in
Exhibit A.
Section 3. Notice of Sal. All sealed bids for the Bonds shall be
submitted to the City Finance Director, on or before June 11, 1996, at 12:00 noon,
Mountain Time. The bids received will be presented to the Council immediately
thereafter on the same day in the Council Chambers at the City Hall, 312 - 1st
Avenue East, Kalispell, Montana, whereupon the Council will consider the award
of sale to the bidder whose bid results in the lowest net effective interest cost payable
on the bonds. The City Clerk of Council is authorized and directed to cause the
notice of the sale to be published, as required by Section 7-7-4434, M.C.A. once in the
Daily Inter Lake, a newspaper circulating in the City of Kalispell at least five days
prior to the date of sale, and may publish a summary of the notice in the Bond
Buyer, and in any other newspaper as may be determined appropriate by the City
Clerk of Council. The notice of sale shall be in substantially the form set forth in
Exhibit B to this resolution.
Section 4. Continuing Disclo ur . 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 awarding the
sale and prescribing the terms of the Bonds to provide certain specified information,
if customarily prepared and publicly available, and notice of the occurrence of
certain events, if material. The City's water system is the only "obligated person" in
respect of the Bonds within the meaning of the Rule and, giving effect to the
issuance of the Bonds, there will not be more than $10 million in principal amount
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of municipal securitiesoutstanding on the date of issuance of the Bonds as to which
the City's water system is an obligated person (excluding municipal securities
exempt from the Rule under paragraph (d)(1) thereof). 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.
PASSED by the City Council of the City of Kalispell, Montana, on this
20th day of May,1996.
ATTEST:
LWJ4�t-, ffl
City Clerk of
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EXHIBIT A
TERMS AND CONDITIONS OF SALE
$1,060,000 Water System Revenue Bonds,
Series 1996
City of Kalispell, Flathead County, Montana
Notice is hereby given by the City Council (the "Council") of Kalispell,
Montana (the "City"), that the Council at a meeting on June 11, 1996, at 12:00 noon,
M.T., in the City Hall, 312 - 1st Avenue East, Kalispell, Montana, will consider the
sale to the highest and best bidder for cash as evidenced by sealed bids, serial bonds
of the City in the total principal amount of $1,060,000 (the "Bonds") for the purpose
of engineering, designing, constructing, and installing certain improvements to the
existing water system, and for funding certain costs incidental to the sale and
payment of bonds and to establish the debt service reserve securing the Bonds. The
Bonds will be issued as fully registered bonds only.
The Bonds will be issued as bonds of single maturities in the
denominations of $5,000 each or any integral multiple thereof. The Bonds will
mature, subject to prior redemption and prepayment, on July 1, in the following
years and amounts:
Year Amount Year Amount
1997
$45,000
2005
$ 75,000
1998
50,000
2006
75,000
1999
55,000
2007
80,000
2000
55,000
2008
85,000
2001
60,000
2009
90,000
2002
60,000
2010
95,000
2003
65,000
2011
100,000
2004
70,000
The Bonds, will be dated, as originally issued, as of June 15,1996, and
will bear interest at the rate or rates, not exceeding seven and one-half percent
(7.50%) per annum, with the maximum difference between the highest and lowest
rate of interest not exceeding three and one-half percent (3.50%) and must be
expressed in integral multiples of 1/8 or 1/20 of 1%, designated by the successful
bidder at the sale. No supplemental or "B" coupon interest is allowed. Interest will
be payable semiannually on January 1 and July 1, of each year commencing January
1,1997.
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The Bonds with stated maturities in 2004 and later years are subject to
redemption at the option of the City, in $5,000 principal amounts selected by lot or
other manner it deems fair within single maturities on any business day after
January 1, 2004, at a redemption price expressed as a percentage of the principal
amount of the Bonds, plus accrued interest, according to the following schedule:
Redemption Date Price
January 1, 2004 through December 31, 2004 102%
January 1, 2005 through December 31, 2005 101%
January 1, 2006 and thereafter 100%
BIDDING AND SALE PROCEDURES
Submission of Bids. Bids must be on the Official Bid form, a: copy of
which may be obtained from the City or the Financial Consultant to the City and
enclosed in a sealed envelope marked as follows: "Bid for $1,060,000 Water System
Revenue Bonds, Kalispell, Montana, Series 1996." 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. The Bids shall be delivered to the City
Finance Director no later than 12:00 noon, M.T., on June 11, 1996.
Basis of Award. The Bonds will be sold for not less than $1,060,000 (par)
with accrued interest to the date of delivery, and all bidders must state the lowest
rate of interest at which they will purchase the bonds. Bids will be compared on the
basis of lowest net effective interest cost. The Council 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.
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 $21,200 (or 2% of the
final principal amount) payable to the order of the City of Kalispell 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 City
Finance Director. 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 City Finance Director, 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.,
Mountain Time, 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
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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. No interest will be allowed on the Deposit. The Deposit of the unsuccessful
bidders will be returned immediately on award of the Bonds to the purchaser or
after rejection of all bids.
Instructions for wiring Deposit may be obtained from the City's Financial
Advisor, D. A. Davidson & Co., 8 Third Street North, Great Falls, Montana 59401,
(406) 771-4212.
BOND REGISTRAR, TRANSFER AGENT
AND PAYING AGENT
The City will select a bank, financial institution 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.
DELIVERY
Within 30 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, 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 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 hereinafter described, 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 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 City, not earlier than
48 hours after the award of sale and not later than the day of closing, a certificate, in
form satisfactory to Bond Counsel, as to the initial reoffering price of each stated
maturity of the Bonds and stating that at least ten percent of the principal amount of
such Bonds of each stated maturity has been sold at such respective prices.
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
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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 awarding the sale and prescribing the terms of the Bonds to
provide certain specified information, if customarily prepared and publicly
available, and notice of the occurrence of certain events, if material. The City's
water system is the only "obligated person" in respect of the Bonds within the
meaning of the Rule and, giving effect to the issuance of the Bonds, there will not be
more than $10 million in principal amount of municipal securities outstanding on
the date of issuance of the Bonds as to which the City's water system is an obligated
person (excluding municipal securities exempt from the Rule under paragraph
(d)(1) thereof). 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.
LEGAL OPINION
An opinion as to the validity of the Bonds and the exclusion of the
interest thereon from gross income for federal income tax purposes and Montana
individual income tax purposes will be furnished by Dorsey & Whitney LLP, of
Missoula, Montana, and Minneapolis, Minnesota, as Bond Counsel. The legal
opinion will be printed on the Bonds. The legal opinion will state that the Bonds
are valid and binding special obligations of the City enforceable in accordance with
their terms, except to the extent to which enforceability thereof may be limited by
the exercise of judicial discretion or by state or federal laws relating to bankruptcy,
reorganization, moratorium or creditors' rights.
CUSIP NUMBERS
The City will assume no obligation for the assignment or printing of
CUSIP numbers on the Bonds or for the correctness of any numbers printed
thereon, but will permit such numbers to be assigned and printed at the expense of
the purchaser, if the original purchaser waives any delay in delivery occasioned
thereby.
OFFICIAL STATEMENT
Within seven business days after the sale the City will furnish to the
successful bidder without charge 100 copies of the final Official Statement relating to
the Bonds. The successful bidder must notify the City Clerk of Council in writing
within seven 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.
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Additional information regarding the City and the Bonds may be obtained
from the City's Financial Advisor, D. A. Davidson & Co., 8 Third Street North, Great
Falls, Montana 59401, (406) 771-4212.
BY ORDER OF THE CITY COUNCIL
IS/ c,
City Clerk of CoUU
City of Kalispell, ontana
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EXHIBIT B
NOTICE OF BOND SALE
$1,060,000 Water System Revenue Bonds, Series 1996
City of Kalispell, Montana
NOTICE IS HEREBY GIVEN that the City Council (the "Council") of
the City of Kalispell, Flathead County, Montana (the "City") will receive and open
sealed bids until 12:00 noon, M.T., on Tuesday, June 11, 1996. The bids will be
opened and tabulated by the City Finance Director and presented to the Council at
their special meeting immediately thereafter.
Amortization bonds will not be accepted.
The bonds will be in the amount of $5,000 or any integral multiple
thereof, and will mature on July 1 in the following years and amounts:
Year
Amount
Year
Amoun
1997
$45,000
2005
$ 75,000
1991
1999
50,000
55,000
2006
2007
75,000
80,000
2000
55,000
2008
85,000
2001
60,000
2009
90,000
2002
60,000
2010
95,000
2003
65,000
2011
100,000
2004
70,000
The bonds will be dated, as originally issued, as of June 15,1996, and
will bear interest at a rate not exceeding seven and one-half percent (7.50%) per
annum, with the maximum difference between the highest and lowest rate of
interest not exceeding three and one-half percent (3.50%) per annum expressed in
integral multiples of 1/8 or 1/20 of one percent (1.00%). No supplemental or "B"
coupons or additional interest certificates are permitted. Interest will be payable on
each January 1 and July 1, commencing January 1, 1997, to the registered owners of
the bonds appearing of record in the Bond Register as of the 15th day of the
immediately preceding month.
The bonds with stated maturities in 2004 and later years are subject to
redemption at the option of the City, in $5,000 principal amounts selected by lot or
other manner it deems fair within single maturities on any business day after
January 1, 2004, at a redemption price expressed as a percentage of the principal
amount of the Bonds, plus accrued interest, according to the following schedule:
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Redemption Date Price
January 1, 2004 through December 31, 2004 102%
January 1, 2005 through December 31, 2005 101%
January 1, 2006 and thereafter 100%
The bonds will be sold for not less than $1,060,000 (par) with accrued
interest, and all bidders must state the lowest rate of interest at which they will
purchase the bonds. The bonds shall be sold by sealed bids. The Council 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 $21,200 payable to the order of the City of Kalispell is
required for each bid to be considered, as further specified in the Terms and
Conditions of Sale.
A legal opinion will be furnished by Dorsey & Whitney LLP, of Missoula,
Montana and Minneapolis, Minnesota. Copies of a statement of Terms and
Conditions of Sale and additional information may be obtained from D. A.
Davidson & Co., 8 Third Street North, Great Falls, Montana, telephone (406) 771-
4212, financial consultants to the City. Prospective bidders should consult the Terms
and Conditions of Sale and the Preliminary Official Statement for a description of
the Bonds, the security therefor, and the legal opinion.
Dated: May 29 , 1996.
PUBLICATION DATE: June Z 1996.
BY ORDER OF THE CITY COUNCIL
City Clerk of o
City of Kalispe
Flathead County, Montana
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