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$600,000 Bonds 200B Golf Course Gross Revenue Bonds - Destroy 020126CLOSING INDEX $600,000 GOLF COURSE GROSS REVENUE BONDS, SERIES 2000B CITY OF NEW HOPE, MINNESOTA 1. Bond Counsel Opinion 2. Official Statement dated March 17, 2000 3. Certified copy of Resolution No. 00-58 adopted March 13, 2000 4. Certificate of Registrar 5. Certificate and Receipt of Finance Director/Treasurer 6. Officers' Certificate 7. Certificate of Purchaser 8. Certificate of Evensen Dodge, Inc. 9. IRS Form 8038G 10. Specimen Bond 11. County Auditor's Certificate DORSEY & WHITNEY LLP MINNEAPOLIS NEW YORK SEATTLE DENVER WASHINGTON, D.C. DES MOINES ANCHORAGE LONDON COSTA MESA City of New Hope New Hope, Minnesota Bernardi Securities, Inc. Chicago, Illinois PILLSBURY CENTER SOUTH 220 SOUTH SIXTH STREET MINNEAPOLIS, MINNESOTA $$402-1498 TELEPHONE: (612) 340-2600 FAX: (612) 340-2868 Re: $600,000 Golf Course Gross Revenue Bonds, Series 2000B City of New Hope, Hennepin County, Minnesota Ladies and Gentlemen: BILLINGS GREAT FALLS MISSOULA BRUSSELS FARGO HONG KONG ROCHESTER SALT LAKE CITY VANCOUVER As Bond Counsel in connection with the authorization, issuance and sale by the City of New Hope, Hennepin County, Minnesota (the "City"), of its Golf Course Gross Revenue Bonds, Series 2000B dated, as originally issued, as of April 1, 2000, in the total principal amount of $600,000 (the 'Bonds"), we have examined certified copies of certain proceedings taken, and certain affidavits and certificates furnished, by the City in the authorization, sale and issuance of the Bonds, including the form of the Bonds. As to questions of fact material to our opinion we have assumed the authenticity of and relied upon the proceedings, affidavits and certificates furnished to us without undertaking to verify the same by independent investigation. From our examination of such proceedings, affidavits and certificates, and based upon laws, regulations, rulings and decisions in effect on the date hereof, it is our opinion that: The Bonds are valid and binding obligations of the City enforceable in accordance with their terms. 2. The principal of and interest on the Bonds are payable solely and exclusively from the gross revenues derived by the City from the operation of its municipal golf course. The City is authorized under certain circumstances to issue additional revenue obligations on a parity of lien with the Bonds. The Bonds are not general obligations of the City and the taxing power of the District is not to be used to provide money for the payment of the principal thereof or interest thereon. DORSEY & WHITNEY LLP $600,000 Golf Course Gross City of New Hope, Hennepin Revenue Bonds, Series 2000B County, Minnesota -2- 3. Interest on the Bonds (a) is not includable in gross income for federal income tax purposes or in taxable net income of individuals, estates or trusts for Minnesota income tax purposes; (b) is includable in taxable income of corporations and financial institutions for purposes of the Minnesota franchise tax; (c) is not an item of tax preference includable in alternative minimum taxable income for purposes of the federal alternative minimum tax applicable to all taxpayers or the Minnesota alternative minimum tax applicable to individuals, estates and trusts; and (d) is includable in adjusted current earnings of corporations in determining alternative minimum taxable income for purposes of the federal alternative minimum tax imposed on corporations. 4. The City has designated the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), and, financial institutions described in Section 265(b)(5) of the Code may treat the Bonds for purposes of Section 265(b)(2) and 291(e)(1)(B) of the Code as if they were acquired on August 7, 1986. The opinions expressed in paragraphs 1 and 2 are subject as to enforceability to the effect of any state or federal laws relating to bankruptcy, insolvency, reorganization, moratorium or creditors' rights and the exercise of judicial discretion. The opinions set forth in paragraphs 3 and 4 are subject to the condition that the City comply with all the requirements of the Code that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes, and the Bonds be and continue to be qualified tax-exempt obligations. The City has covenanted in the resolution authorizing the issuance of the Bonds to comply with these continuing requirements. Failure of the City to comply with these requirements may result in the inclusion of interest on the Bonds in federal gross income and in Minnesota taxable net income, retroactive to the date of issuance of the Bonds. Except as stated in this opinion, we express no opinion regarding federal, state or other tax consequences to owners of the Bonds. We have not been asked, and have not undertaken, to review the accuracy, completeness or sufficiency of any offering materials relating to the Bonds, and accordingly, we express no opinion with respect thereto. Dated: April 11, 2000 Very truly yours, t l aw L&P NEW ISSUE: FULL BOOK -ENTRY Rating: Not Rated In the opinion of Bond Counsel, underpresent Minnesota and federal laws, regulations, rulings, and decisions, interest on the Bonds is not includable in gross income of the recipient for federal income tax purposes or in taxable net income of individuals, estates, and trusts for Minnesota income tax purposes (such interest is includable in taxable income of corporations and financial institutions for purposes of Minnesotafranchisetax). See"Tax Matters " herein. Dated: April 1, 2000 OFFICIAL STATEMENT $600,000 Golf Course Gross Revenue Bonds, Series 2000B CITY OF NEW HOPE, MINNESOTA Due: February 1, 2001/2020 The City of New Hope, Minnesota (the "City") is issuing $600,000 Golf Course Gross Revenue Bonds, Series 2000B (the "Bonds") pursuant to Minnesota Statutes, Chapter 475 and Section 471.191 Subd. 2 to finance improvements to the City's municipal golf course. The Bonds are not general obligations of the City, but are payable solely from the gross revenues of the City's municipal golf course. The Bonds will be issued as fully registered bonds without coupons and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"). DTC will act as securities depository of the Bonds. Individual purchases may be made in book -entry form only in the principal amount of $5,000 and integral multiples thereof. Purchasers will not receive Bonds representing their interest in the Bonds purchased. Principal of Bonds, payable annually on each February 1 commencing February 1, 2001, and interest on the Bonds, payable semi-annually on each February 1 and August 1 commencing August 1, 2000, will be paid to DTC, which will in mm remit such principal and interest to its participants for subsequent disbursement to the beneficial owners of the Bonds. See "Book -Entry Only System" herein. The Bonds will mature February 1 in the years and amounts as follows: Year Amount Rate Yield CUSIP Year Amount 2001 $25,000 6.125% 5.00% 645450 A R 8 2011 $30,000 2002 20,000 6.125% 5.10% 645450 A S 6 2012 30,000 2003 20,000 6.125% 5.20% 645450 A T 4 2013 30,000 2004 20,000 6.20% 5.30% 645450 A U 1 2014 35,000 2005 20,000 6.20% 5.40% 645450 A V 9 2015 35,000 2006 20,000 6.20% 5.500/. 645450 A W 7 2016 40,000 2007 25,000 6.20% 5.60% 645450 A X 5 2017 40,000 2008 25,000 6.20% 5.70% 645450 A Y 3 2018 40,000 2009 25,000 6.20% 5.80% 645450 A Z 0 2019 45,000 2010 25,000 6.20% 5.85% 645450 B A 4 2020 50,000 Rate Yield CUSIP 6.25% 5.90% 645450 B B 2 6.25% 6.00% 645450 B C 0 6.25% 6.05% 645450 B D 8 6.25% 6.10% 645450 B E 6 6.25% 6.25% 645450 B F 3 6.30% 6.30% 645450 B G 1 6.35% 6.35% 645450 B H 9 6.40% 6.40% 645450 B J 5 6.45% 6.45% 645450 B K 2 6.50% 6.50% 645450 B L 0 The Bonds maturing in the years 2008 and thereafter are subject to prior redemption on February 1, 2007 and any date thereafter at a price of par. BANK QUALIFIED: The Bonds are designated as "Qualified Tax -Exempt Obligations." LEGAL OPINION: Dorsey & Whitney LLP, Minneapolis, Minnesota Bernardi Securities, Inc. has agreed to purchase the Series 2000B Golf Course Revenue Bonds from the City of New Hope, Minnesota for an aggregate price of $591,000.70. The Series 2000B Bonds will be available for delivery on April 11,2000. The date of this Final Official Statement is March 17, 2000. (THIS COVER PAGE CONTAINS CERTAIN INFORMATION FOR QUICK REFERENCE ONLY. ITISNOTA SUMMARY OF THIS ISSUE. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATIONESSENTIAL TO THE MAKING OFANINFORMED INVESTMENTDECISION) BERNARDI SECURITIES, INC. No dealer, broker, salesman or other person has been authorized by the City, the Financial Advisor or the Underwriters to give any information or to make any representations other than those contained in this Final Official Statement and, if given or made, such information and representations must not be relied upon as having been authorized by the City, the Financial Advisor or the Underwriters. This Final Official Statement does not constitute an offer to sell or solicitation of an offer to buy, nor shall there be any sale of the Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth herein has been obtained from the City and other sources which are believed to be reliable, but it is not to be construed as a representation by the Financial Advisor or Underwriters. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Final Official Statement nor any sale made thereafter shall, under any circumstances, create any implication that there has been no change in the affairs of the City or in any other information contained herein, since the date hereof. TABLE OF CONTENTS Pape Introduction to the Official Statement .....................1 Roster of City Officials............................................2 Description of the Bonds.........................................3 Business and Industry ........................................14 Purpose and Authority .........................................3 Retail Sales and Buying Income ........................16 Security................................................................3 Construction.......................................................16 Redemption Provisions........................................3 Economic Development.....................................17 Sources and Uses of Funds..................................4 Education...........................................................18 Interest Computation............................................4 Indebtedness.......................................................... Registration, Transfer and Exchange...................4 General Obligation Debt....................................19 Book -Entry -Only System.....................................4 RevenueDebt.....................................................21 NoRating.............................................................6 DebtLimit..........................................................21 Federal Tax Considerations..................................6 Overlapping Debt...............................................23 Qualified Tax -Exempt Bonds ..............................7 Future Financing................................................23 Certain Bondholders' Risks.................................7 Financial Information............................................24 The Resolution.........................................................8 Financial Report .................................................24 Flow of Funds......................................................8 Results of Operations.........................................24 TheGolf Course......................................................9 The Budgetary Process.......................................25 TheProject.............................................................10 Investment Policy...............................................26 Historical Golf Course Revenues ....................... 10 Projected Debt Service Coverage ....................... 11 Financial Summary ................................................12 Miscellaneous........................................................27 General Information..............................................13 Employees..........................................................13 City Services and Recreation .............................13 Economic and Demographic Information .............14 0159089f Pape Population..........................................................14 Business and Industry ........................................14 Retail Sales and Buying Income ........................16 Construction.......................................................16 Economic Development.....................................17 Education...........................................................18 Indebtedness.......................................................... 19 General Obligation Debt....................................19 RevenueDebt.....................................................21 DebtLimit..........................................................21 Overlapping Debt...............................................23 Future Financing................................................23 Financial Information............................................24 Financial Report .................................................24 Results of Operations.........................................24 The Budgetary Process.......................................25 Investment Policy...............................................26 Certification...........................................................26 No Continuing Disclosure.....................................27 Miscellaneous........................................................27 Appendix A - Financial Statements Appendix B - Form of Legal Opinion (This page has been left blank intentionally.) INTRODUCTION TO THE OFFICIAL STATEMENT The following information is furnished solely to provide limited introductory information regarding the City of New Hope's $600,000 Golf Course Gross Revenue Bonds, Series 2000B (the "Bonds"), and does not purport to be comprehensive. All such information is qualified in its entirety by reference to the more detailed descriptions appearing in this Official Statement, including the appendices hereto. Issuer: City of New Hope, Minnesota Security: The Bonds are not general obligations of the City but will be payable from the gross revenues Terived by the City from the operation of its municipal golf course. Purpose and Authority: The Bonds financing improvements to the City's municipal golf course are issued pursuant to Minnesota Statutes, Chapter 475 and Minnesota Statutes, Section 471.191, Subdivision 2. Optional Redemption: The Bonds maturing in the years 2008 and thereafter are subject to prior redemption on February 1, 2007 and any date thereafter at a price of par plus accrued interest. Denominations: $5,000 or integral multiples thereof. Principal Payments: Annually on February 1, 2001 through 2020. Interest Payments: Semiannually on February 1, and August 1, commencing August 1, 2000. Tax Stains: Generally exempt from federal and state income taxes (see "Tax Matters" herein). The Bonds will be designated as Qualified Tax -Exempt Obligations. Professional Consultants: Bond Counsel: Dorsey & Whitney LLP Minneapolis, Minnesota Financial Advisor: Evensen Dodge, Inc. Minneapolis, Minnesota Registrar., City of New Hope, Minnesota The Official Statement is in a form deemed final as of its date for purposes of Securities and Exchange Commission Rule I5c2-11(b) (the "Rule'), but is subject to minor revision or amendment in accordance with the Rule. The Final Oficial Statement dated March 17, 2000, includes the maturity dates and amounts, interest rates and reoffering yields or prices, credit ratings, and any other information required by law Questions regarding the Obligations or the Official Statement can be directed to and additional copies of the Official Statement, the City's audited financial reports and the Resolution may be obtained from Daryl Sulander, Finance Director, City of New Hope, City Hall, 4401 Xylon Avenue, New Hope, Minnesota 55428, 612/531-5131 or Evensen Dodge, Inc., 601 Second Avenue South, Suite 5100, Minneapolis, Minnesota 55402, 612/338-3535, financial advisor to the City. The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made thereafter shall, under any circumstances, create any implication that there has been no change in the affairs of the City or in any other information contained herein, since the date hereof. ROSTER OF CITY OFFICIALS CITY OF NEW HOPE, MINNESOTA City Council W. Peter Enck Mayor Pat La Vine Norby Council Member Mark Thompson Council Member Sharon Cassen Council Member Don Collier Council Member Administration Daniel J. Donahue City Manager Sherry Draper Director ofAdministraton Sharon French Director of Parks and Recreation Gary Link Director of Police Valerie Leone City Clerk Guy Johnson Director of Public Works Kirk McDonald Director of Community Development Daryl Sulander Director of Finance / City Treasurer Bond Counsel DORSEY& WHITNEYLLP Minneapolis, Minnesota Financial Consultants EvENSENDODGE, ING Minneapolis, Minnesota Pa DESCRIPTION OF THE BONDS Purpose and Authority The Bonds financing improvements to the City's municipal golf course are issued pursuant to Minnesota Statutes, Chapter 475 and Minnesota Statutes, Section 471.191, Subdivision 2. Security The principal of and interest on the Bonds are payable solely and exclusively from the gross revenues derived by the City from the operation of its municipal golf course. The City is authorized under certain circumstances to issue additional revenue obligations on a parity of lien with the Bonds. The Bonds are not general obligations of the City and the taxing power of the City is not to be used to provide money for the payment of the principal thereof or interest thereon (see Flow of Funds herein). Redemption Provisions The Bonds maturing in the years 2001 through 2007 shall not be subject to redemption prior to maturity, but the Bonds maturing in the years 2008 through 2020 shall each be subject to redemption and prepayment, at the option of the City, in whole or in part, and if in part, in the maturities selected by the City and, within any maturity, in $5,000 principal amounts selected by the Registrar by lot, on February 1, 2007 and on any date thereafter at a price equal to the principal amount thereof to be redeemed plus interest accrued to the date of redemption. At least thirty days prior to the date set for redemption of any Bond, the City Manager shall cause notice of the call for redemption to be mailed to the Registrar and to the registered owner of each Bond to be redeemed, but no defect in or failure to give such mailed notice of redemption shall affect the validity of proceedings for the redemption of any Bond not affected by such defect or failure. The notice of redemption shall specify the redemption date, redemption price, the numbers, interest rates and CUSIP numbers of the Bonds to be redeemed and the place at which the Bonds are to be surrendered for payment, which is the principal office of the Registrar. Official notice of redemption having been given as aforesaid, the Bonds or portions thereof so to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified and from and after such date (unless the City shall default in the payment of the redemption price) such Bonds or portions thereof shall cease to bear interest. In addition to the notice prescribed by the preceding paragraph, the City shall also give or cause to be given, notice of the redemption of any Bond or Bonds or portions thereof at least 30 days before the redemption date by certified mail or telecopy to the Purchaser and all registered securities depositories then in the business of holding substantial amounts of obligations of the character of the Bonds (such depositories now being The Depository Trust Company, of Garden City, New York; Pacific Securities Depository Trust Company, of San Francisco, California; and Philadelphia Depository Trust Company, of Philadelphia, Pennsylvania) and one or more national information services that disseminate information regarding municipal bond redemptions; provided that any defect in or any failure to give any notice of redemption prescribed by this paragraph shall not affect the validity of the proceedings for the redemption of any Bond or portion thereof. Bonds in a denomination larger than $5,000 may be redeemed in part in any integral multiple of $5,000. The owner of any Bond redeemed in part shall receive, upon surrender of such Bond to the Registrar, one or more new Bonds of such same series in authorized denominations equal in principal amount to the unredeemed portion of the Bond so surrendered. Sources and Uses of Funds A table presenting the sources and uses of funds for the Bonds shown below. Table 1 Sources and Uses of Funds Sources of Funds: Par Amount of Bonds $ 600,000.00 Accrued Interest to April 11, 2000 1,046.49 Total Sources of Funds $ 601.046 49 Uses of Funds: Project Costs $ 588,048.70 Underwriting Discount Allowance 8,999.30 Cost of Issuance 2,952.00 Debt Service Fund 1,046.49 Total Uses of Funds 601.046.49 Interest Computation Interest on the Bonds will be computed on a 360 -day year, 30 -day month basis. Registration, Transfer and Exchange The City of New Hope will act as registrar for the Bonds. The Bonds will be initially registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"). DTC will act as securities depository for the Bonds. Individual purchases may be made in book -entry form only, in the principal amount of $5,000 or integral multiples thereof. Purchasers will not receive certificates representing their interest in the Bonds purchased. See "Book -Entry -Only System." Book -Entry -Only System The information contained in the following paragraphs of this subsection "Book -Entry Only System" has been extracted from a publication prepared by the Depository Trust Company ("DTC") entitled "SAMPLE OFFERING DOCUMENT LANGUAGE DESCRIBING BOOK -ENTRY ONLY ISSUANCE." The City makes no representation as to the completeness or accuracy of information or as to the absence of material adverse changes in such information subsequent to the date thereof. The Depository Trust Company ("DTC"), New York, New York will act as securities depository for the Bonds. The Bonds will be issued as fully -registered securities registered in the name of Cede & Co. (DTC's partnership nominee). One fully -registered Bond certificate will be issued for each annual maturity of the Bonds, each in the aggregate principal amount of such annual maturity, and will be deposited with DTC. DTC is a limited -purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds securities that its participants ("Participants") deposit with DTC. DTC also facilitates the settlement among Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book -entry changes in Participants' accounts, thereby eliminating the need for physical movement of security certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations ("Direct Participants"). DTC is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). The Rules applicable to DTC and its Participants are on file with the Securities and Exchange Commission. Purchases of Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC's records. The ownership interest of each actual purchaser of each Bond ("Beneficial Owner") is in tum to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Bonds are to be accomplished by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Bonds, except in the event that use of the book -entry system for the Bonds is discontinued. To facilitate subsequent transfers, all Bonds deposited by Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co. The deposit of Bonds with DTC and their registration in the name of Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to Cede & Co. If less than all of the Bonds within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each District Participant in such issue to be redeemed. Neither DTC or Cede & Co. will consent or vote with respect to the Bonds. Under its usual procedures, DTC mails an Omnibus Proxy to the City as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Principal and interest payments on the Bonds will be made to DTC. DTC's practice is to credit Direct Participants' accounts on the payable date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it will not receive payment on the payable date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC or the City, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to DTC is the responsibility of the City, disbursements of such payments to Direct Participants shall be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable notice to the City. Under such circumstances, in the event that a successor securities depository is not obtained, Bond certificates are required to be printed and delivered. The City may decide to discontinue use of the system of book -entry transfers through DTC (or a successor securities depository). In that event, Bond certificates will be printed and delivered. The information in this section concerning DTC and DTC's book -entry system has been obtained from sources that the City believes to be reliable, but the City takes no responsibility for the accuracy thereof. No Rating The Bonds are not rated. Federal Tax Considerations In the opinion of Dorsey & Whitney LLP, as Bond Counsel, on the basis of laws in effect on the date of issuance of the Bonds, interest on the Bonds is not includable in gross income for federal income tax purposes or in taxable net income of individuals, estates and trusts for Minnesota income tax purposes. Interest on the Bonds is not excludable, however, from the computation of income tax purposes of the Minnesota corporate income tax and the Minnesota corporate license tax. Certain provisions of the Internal Revenue Code of 1986, as amended (the "Code"), however, impose continuing requirements that must be met after the issuance of the Bonds in order for interest thereon to be and remain not includable in federal gross income and in Minnesota taxable net income. Noncompliance with such requirements by the City may cause the interest on the Bonds to be includable in gross income for purposes of federal gross income and in Minnesota taxable net income retroactive to the date of issuance of the Bonds irrespective in some cases of the date on which such noncompliance occurs or is ascertained. No provision has been made for redemption of or for an increase in the interest rate on the Bonds in the event that interest on the Bonds becomes includable in federal gross income or Minnesota taxable net income. Interest on the Bonds is not an item of tax preference includable in altemative minimum taxable income for purposes of the federal alternative minimum tax applicable to all taxpayers or the Minnesota alternative minimum tax applicable to individuals, estates and trusts, but is includable in adjusted current earnings or corporations in determining the alternative minimum taxable income for purposes of the alternative minimum tax and the environmental tax imposed by Section 59A of the Code. Interest on the Bonds may be includable in the income of a foreign corporation for purposes of the branch profits tax imposed by Section 884 of the Code and is includable in the net investment income of foreign insurance companies for purposes of Section 842(b) of the Code. In the case of an insurance company subject to the tax imposed by Section 831 of the Code, the amount which otherwise would be taken into account as losses incurred under Section 832(b)(5) of the Code must be reduced by an amount equal to fifteen percent of the interest on the Bonds that is received or accrued during the taxable year. Section 86 of the Code and corresponding provisions of Minnesota law require recipients of certain Social Security and railroad retirement benefits to take into account, in determining the taxability of such benefits, interest on the Bonds. Passive investment income, including interest on the Bonds, may be subject to federal income taxation under Section 1375 of the Code and corresponding provisions of Minnesota law for a Subchapter S corporation that has Subchapter C earnings and profits at the close of the taxable year if greater than twenty-five percent of the gross receipts is passive investment income. Section 265 of the Code denies a deduction for interest on indebtedness incurred or continued to purchase or carry the Bonds or, in the case of a financial institution, that portion of the holder's interest expense allocated to interest on the Bonds, except with respect to certain financial institutions (within the meaning of Section 265(b) of the Code.) The foregoing is not intended to be an exhaustive discussion of collateral tax consequences arising from receipt of interest on the Bonds. Prospective purchasers or bondholders should consult their tax advisors with respect to collateral tax consequences, including without limitation the calculations of alternative minimum tax, environmental tax or foreign branch profits tax liability or the inclusion of Social Security or other retirement payments in taxable income. Qualified Tax -Exempt Bonds The City will designate the Bonds as "qualified tax-exempt Bonds" for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended, relating to the ability of financial institutions to deduct from income for Federal income tax purposes, interest expense that is allocable to carrying and acquiring tax-exempt Bonds. Certain Bondholders'Bisks Prospective purchasers of the bonds should be aware that investment in the Bonds may entail some degree of risk. Each prospective investor in the Bonds is encouraged to read this Official Statement in its entirety. Particular attention should be given to the factors described below which, among others, could affect the payment of debt service on the bonds and which could also affect the market price of the Bonds to an extent that cannot be determined. This discussion of risk factors is not, and is not intended to be, exhaustive. 1. Limited Obligation The obligation of the City to pay debt service on the Bonds is a limited obligation of the City. The full faith and credit and taxing power of the City are not pledged to pay debt service on the Bonds, and the City does not have the authority to levy ad valorem property taxes in order to pay debt service on the Bonds. As further described elsewhere herein, debt service on the Bonds is payable solely from Gross Revenues derived by the City from the operation of its municipal golf course. While it is believed that revenues of the Golf Course will be sufficient to pay operating and maintenance costs of the Golf Course as well as debt service on the Bonds when due, a number of factors described below may affect the receipt of sufficient revenues from the Golf Course for such purposes, which may impair the ability of the City to make timely debt service payments on the Bonds. 2. General Factors that May Affect Sufficiency of Revenues As stated above, the City is obligated to pay debt service on the Bonds solely from gross revenues generated by the operation of the Golf Course. A number of factors may have an adverse affect on the receipt of monies in an amount sufficient to pay operating and maintenance expenses of the Golf Course as well as debt service on the Bonds. These factors include vandalism, adverse weather conditions, and the possible slowdown in play during construction of the new clubhouse. 3. Competition The Golf Course is subject to other competing golf courses in the area. This competition could have an adverse affect on the receipt of monies in an amount sufficient to pay operating and maintenance expenses of the golf course as well as debt service on the Bonds. THE RESOLUTION The following is a summary of certain provision of the Resolution: FLOW OF FUNDS Golf Course Fund The City shall establish and maintain, so long as the Bonds are outstanding, a separate fund to be designated the "The Golf Course Fund" (the "Golf Course Fund") and within such Revenue Fund accounts designated as the Revenue Bond Account, and Reserve Account. The City shall deposit in the Revenue Bond Account all Bond proceeds as well as all of the gross income and revenue derived by the City from the services, use, and availability of the Facilities from and after the issuance of the Bonds. On or prior to February I and August I of each year, commencing August 1, 2000, the City shall transfer from amounts then on deposit in the Golf Course Fund in the following amounts in the following order: (i) To the Revenue Bond Account, the amount required to be deposited therein as described below under the caption "Revenue Bond Account"; (ii) To the Reserve Account, such amount, if any, as may be required so that the balance therein shall equal the Debt Service Reserve Requirement. Any balance on hand from time to time not required to be deposited in the Revenue Bond Account or the Reserve Account within the next twelve months may be used for any lawful purpose. Revenue Bond Account The City shall establish and maintain, so long as the Bonds are outstanding, a separate account in its Golf Course Fund to be designated "Revenue Bond Account' (the "Revenue Bond Account'). The City shall make the following deposits into the Revenue Bond Account: a) From funds on deposit in the Golf Course Fund, on or prior to February 1 and August I of each year, commencing August 1, 2000, an amount equal to (1) the amount payable as interest on the Bonds due on such February 1 or August 1, plus (2) the amount payable as principal on the Bonds due on such February 1 or August 1, after crediting against any prior semiannual deposit, (i) the amount of accrued interest originally deposited to the credit of the Revenue Bond Account from the proceeds of the Bonds. b) On each principal and interest payment date, from funds on deposit in the Reserve Account, such additional amounts, if any, as may be necessary to meet principal and interest payments then due. The moneys and investments in the Revenue Bond Account are irrevocably pledged to and shall be used by the City for the payment of principal of and interest on the Bonds when such principal and interest shall become due and payable and for that purpose only. Reserve Account The City shall establish and maintain, so long as any of the Bonds are outstanding, an account in its Golf Course Fund to be designated "Reserve Account' (the "Reserve Account'), into which the City shall make the following deposits: a) The initial Debt Service Reserve Requirement from the proceeds of the sale of the Bonds shall be deposited promptly when received. b) From funds on deposit in the Golf Course Fund, after making required transfers to the Revenue Bond Account such amounts as may be necessary so that the funds and investments on deposit in the Reserve Account are promptly restored to the Debt Service Reserve Requirement. In computing the amounts on deposit in the Reserve Account at any time, Qualified Investments shall be valued at the cost thereof, including that portion of the purchase price which represents accrued interest. If the value of cash and investments in the Reserve Account is equal to or exceeds the Debt Service Reserve Requirement, all investment interest and income from the Reserve Account shall be transferred to the Revenue Bond Account and credited against amounts required to be deposited therein from the Golf Course Fund. Amounts on deposit in the Reserve Account are irrevocably pledged to and shall be used by the City to the extent required, to restore any deficiencies in the Revenue Bond Account and for the payment of principal of and interest on the Bonds when such principal and interest shall become due and payable and for that purpose only. Additional Bonds The City hereby agrees that it will not issue any additional obligations payable from the revenues of the Facilities or constituting a lien or charge thereon superior to or on a parity with the bonds payable from the Revenue Bond Account unless it has first retired, or placed in escrow within a depository bank, moneys or securities to discharge the outstanding bonds prior to the issuance of such additional obligations or unless the gross revenues of the Facilities in the last complete fiscal year immediately preceding the issuance of such additional obligations shall have been at least equal to 200% of the maximum amount of principal and interest to come due in any future fiscal year, during the remaining term of the outstanding bonds, on all of the outstanding bonds payable from the revenues of the Facilities and on the additional obligations then proposed to be issued. Notwithstanding the above provisions, nothing in this resolution shall be construed to preclude the City from issuing additional bonds, whether constituting a general obligation of the City or payable solely from revenues of the Facilities, for construction, reconstruction or improvement of the Facilities, provided such additional bonds are expressly made a lien and charge on the revenues of the Facilities subordinate and junior to that of the bonds payable from the Revenue Bond Account. THE GOLF COURSE The City operates the golf course as an Enterprise Fund. The acquisition, maintenance and improvement of the physical plan facilities required to provide these goods and services are financed from existing cash or the issuance of bonds (Revenues or General Obligations). The City has owned Village Greens Golf Course for the past 29 years. The par 3 nine -hole course is located on 26 acres of land at 8130 Bass Lake Road. The course has operated profitably each year, accumulating retained earnings of $746,000. The unaudited December 31, 1999 cash balance is $261,362. The City Council approved greens fee increases for the 2000 and 2001 seasons on February 28, 2000. The fees increased from $9 to $10 for the 2000 season and from $10 to $11 for the 2001 season. The greens fee and pro shop revenue (less cost of goods sold) for 1999 was $322,363, with 2000 net revenue budgeted at $360,000. The course's primary customers for the past 29 seasons have been senior adults, juniors and women. Senior, junior, and women league play represents a sizable portion of overall play. THE PROJECT The City is planning on constructing a new clubhouse to its existing municipal golf course. The plans call for a 3,000 square foot facility, which will house a pro -shop, concession area, storage space and a two -person office. Construction is to begin with removal of the current clubhouse by September 2000. The project is anticipated to be completed by April of 2001. Historical Golf Course Revenues Table 2 presents the annual golf course revenues, net income and yearly golf rounds for the years 1996 through 1999. Table 2 Historical Revenues Existing green fees and inflated operating costs impacted net income. Green fees will increase from $9 to $10 in 2000 and $10to$11 in 2001. (]) Opened shortened course in late May impacting net income. (The remainder of this page has been left blank intentionally). 10 Unaudited 1999 1998 1997 1996 Revenues: Green fees $288,673 $281,931 $251,677 $212,423 Concessions and Sales 44,952 51,767 43,074 38,510 Rentals 11,075 11,365 10,849 8,564 Other 31,432 8,439 10,771 10,105 Less cost of goods33 339 3( 5,568)2( 8,637) (26,057) Total Revenues 342,793 317,934 287,734 243,545 Operating expenses 293,466 240,437 214,377 237,561 Net Income (_) Retained Earnings (year end) 722,755 $681,646 $604,149 $530,792 Golf Rounds 37,371 40,488 36,351 29,839 Existing green fees and inflated operating costs impacted net income. Green fees will increase from $9 to $10 in 2000 and $10to$11 in 2001. (]) Opened shortened course in late May impacting net income. (The remainder of this page has been left blank intentionally). 10 Projected Debt Service Coverage Presented below is the debt service coverage on the Bonds based on 1999 revenues. Totals 1 021 979 6.855.680 804 460 o) Estimated average interest rate of 5.88%. (Z) Figures are based on 1999 golf course revenues. These are not projections of future revenues. ts) For information only. The Bonds are secured by a pledge of the gross revenues of the Golf Course. ll Table 3 Debt Service Coverage Fiscal Year Gross Debt Net Debt Ending Debt Gross Net Service Service 12/31 Service") Revenues (2) Revenues Coverage Coverage 3) 2000 NA $ 342,784 $ 90,223 NA NA 2001 $ 53,142 342,784 90,223 6.45 1.70 2002 52,720 342,784 90,223 6.50 1.71 2003 51,870 342,784 90,223 6.61 1.74 2004 50,910 342,784 90,223 6.73 1.77 2005 49,920 342,784 90,223 6.87 1.81 2006 48,900 342,784 90,223 7.01 1.85 2007 52,860 342,784 90,223 6.48 1.71 2008 51,535 342,784 90,223 6.65 1.75 2009 50,185 342,784 90,223 6.83 1.80 2010 48,823 342,784 90,223 7.02 1.85 2011 52,435 342,784 90,223 6.54 1.72 2012 50,755 342,784 90,223 6.75 1.78 2013 49,060 342,784 90,223 6.99 1.84 2014 52,335 342,784 90,223 6.55 1.72 2015 50,270 342,784 90,223 6.82 1.79 2016 53,170 342,784 90,223 6.45 1.70 2017 50,770 342,784 90,223 6.75 1.78 2018 48,330 342,784 90,223 7.09 1.87 2019 50,890 342,784 90,223 6.74 1.77 2020 53.100 342,784 90,223 6.46 1.70 Totals 1 021 979 6.855.680 804 460 o) Estimated average interest rate of 5.88%. (Z) Figures are based on 1999 golf course revenues. These are not projections of future revenues. ts) For information only. The Bonds are secured by a pledge of the gross revenues of the Golf Course. ll FINANCIAL SUMMARY (This summary is subject in all respects to more complete information contained in this Official Statement) INDICATED MARKET VALUE, 1998/99 $ 946,551,419 ESTIMATED MARKET VALUE, 1998/99 $ 867,041,100 TOTAL ADJUSTED NET TAX CAPACITY 1998/99 $ 15,640,003 GENERAL OBLIGATION DEBT $ 19,060,000 REVENUE DEBT (This Issue) $ 600,000 OVERLAPPING DEBT $ 8,749,706 POPULATION (1996 Estimate) 21,646 DEBT RATIOS Per % of Capita Indicated Amount (21,646) Market Value G.O. Debt $19,060,000 $ 881 2.01% Overlapping Debt 8,749,706 404 0.92% Total 527.809.706 $-1285 2.93% (The remainder of this page left blank intentionally) 12 GENERAL INFORMATION The City of New Hope is located in Hennepin County, approximately seven miles northwest of the central business district of the City of Minneapolis. The City is approximately 99% developed and had a 1990 census population of 21,853. The City describes itself as "styled for family living" and has become a prime residential area in the western suburbs of the Twin Cities of Minneapolis and St. Paul. New Hope was incorporated as a village in 1953. It is now governed by a Mayor and four Council members. City operating policy is established by this five -member elected City Council. Under the Plan B form of government, approved by the citizens in 1966, the Council provides the legal framework for City operations by adopting ordinances and resolutions, authorizing the execution of the regulations, and providing the financial and personnel resources needed to carry out the policy. The City Manager is responsible for the City's general administrative coordination. In addition, the Manager is directly charged with the responsibility for City purchasing, budgeting, planning, personnel and Civil Defense. The Manager's office, through the assistance of a Management Assistant/Community Development coordinator, also administers the City's Section 8 Rental Assistance Program, the Community Development Block Grant program and other local economic development programs. The City provides a full range of municipal services, including police and fire protection, parks and recreations, public improvements, street maintenance, sanitary and storm water, water, health, social, planning and general administrative services. Under an agreement dated November 1, 1963, the cities of New Hope, Golden Valley, and Crystal established joint ownership of a water supply and distribution system. A joint water commission was established to purchase water from the City of Minneapolis. Sewage treatment is provided by the Metropolitan Area Sewage System. The City's water and sewer utilities are connected to virtually all of the community's residential units and commercial industrial enterprises. Employees A total of 87 persons are employed by the City on a full-time basis. Summer employees total 225. All full-time and certain part-time employees of the City are covered by defined benefit pension plans administered by the Public Employees Retirement Association of Minnesota (PERA). PERA administers the Public Employees Retirement Fund (PERF) and the Public Employees Police and Fire Fund (PEPFF), which are cost-sharing multiple -employer retirement plans. The City's contribution for PERF pension costs during fiscal 1996 was $128,503 and for PEPFF was $147,637. City Services and Recreation The City provides police protection inter -related with surrounding communities through a mutual aid agreement. The police force has 38 full-time employees, of which 29 are police officers. Fire services are contracted with West Metro Fire -Rescue District. The City maintains over 200 acres of park land, including playgrounds, natural park areas, tennis courts, a nine -hole golf course, swimming pool and ice arena. 13 ECONOMIC AND DEMOGRAPHIC INFORMATION Population Table 4 shows the population of the City and of Hennepin County as recorded in the past three censuses and as estimated for 1996 and as projected for the year 2000 by the Metropolitan Council. Table 4 Population Statistics to Estimates/projections from the Metropolitan Council. Business and Industry The City of New Hope is part of the Minneapolis/St. Paul metropolitan area and, therefore, residents of the City find employment throughout the metropolitan area. The major employers in the City of New Hope are presented in Table 5. Employer North Ridge Care Center Egan Companies Lakeside Limited, Inc. Tool Products Company St. Therese Care Center Liberty Diversified Waymouth Farms, Inc. Nordic Press & Packaging Inc. Keelor Steel & Aluminum Co. Navarre Corporation Lakeside Nameplate Company Gaines & Hanson Printing Company Primo PiattaJ2) Reed Spectrum Oildyne Division Display Master, Inc. CSD CTS Corporation Ware Manufacturing Company Mello Smello-Internatural Designs, Inc. (') Includes 70-100 seasonal employees. (2) Formerly know as Creamette Company. Table 5 Principal Employers -1997 Type of Business Skilled Nursing Care Facilities Electrical Work Signs & Advertising Displays Aluminum Die -Castings Skilled Nursing Care Facilities Stationery Supplies Salted & Roasted Nuts & Seeds Commercial Printing, Lithographic Blast Furnaces & Steel Mills Computers, Peripherals & Software Manufacturing Industries Commercial Printing Macaroni and Spaghetti Plastics Materials Synthetic Resins Fluid Power Cylinders & Actuators Advertising Paper Coated & Laminated, Packaging Electronic Connectors Metal Stampings Business Services Source: Minnesota Department of Trade and Economic Development. 14 Number of Employees 1,050P) 625 350 340 200 200 175 175 160 150 150 140 130 120 120 115 110 110 100 100 City of Hennepin Year New Hope County 1970 23,087 941,911 1980 23,180 960,080 1990 21,853 1,032,431 1996(') 21,646 1,056,673 200011 23,300 1,109,820 to Estimates/projections from the Metropolitan Council. Business and Industry The City of New Hope is part of the Minneapolis/St. Paul metropolitan area and, therefore, residents of the City find employment throughout the metropolitan area. The major employers in the City of New Hope are presented in Table 5. Employer North Ridge Care Center Egan Companies Lakeside Limited, Inc. Tool Products Company St. Therese Care Center Liberty Diversified Waymouth Farms, Inc. Nordic Press & Packaging Inc. Keelor Steel & Aluminum Co. Navarre Corporation Lakeside Nameplate Company Gaines & Hanson Printing Company Primo PiattaJ2) Reed Spectrum Oildyne Division Display Master, Inc. CSD CTS Corporation Ware Manufacturing Company Mello Smello-Internatural Designs, Inc. (') Includes 70-100 seasonal employees. (2) Formerly know as Creamette Company. Table 5 Principal Employers -1997 Type of Business Skilled Nursing Care Facilities Electrical Work Signs & Advertising Displays Aluminum Die -Castings Skilled Nursing Care Facilities Stationery Supplies Salted & Roasted Nuts & Seeds Commercial Printing, Lithographic Blast Furnaces & Steel Mills Computers, Peripherals & Software Manufacturing Industries Commercial Printing Macaroni and Spaghetti Plastics Materials Synthetic Resins Fluid Power Cylinders & Actuators Advertising Paper Coated & Laminated, Packaging Electronic Connectors Metal Stampings Business Services Source: Minnesota Department of Trade and Economic Development. 14 Number of Employees 1,050P) 625 350 340 200 200 175 175 160 150 150 140 130 120 120 115 110 110 100 100 Table 6 lists some of the largest employers in the Minneapolis/St. Paul metropolitan area. Table 6 Largest Metro Area Employers Employer State of Minnesota U.S. Government University of Minnesota Dayton Hudson Corporation Allina Health Systems 3M Company NWA Inc. Norwest Corporation Hennepin County Fairview Hospital and Healthcare Services HealthPartners Honeywell, Inc. U.S. Bancorp City of Minneapolis Approximate Number Product/Service of Employees') State Goverment 52,676 Federal Government 33,383 State University 30,728 Retail 28,265 Health Care and Hospitals 21,200 Industrial & Consumer Services 20,370 Air Transportation 19,045 Banking, Financial Services 12,296 County Government 10,384 Health Care and Hospitals 10,000 Health Care and Hospitals 8,500 Automation and Control Systems 7,700 Banking, Financial Services 7,093 Local Goverment 5,555 (') Includes employees in Minnesota outside of the metropolitan area. Source: Minneapolis/Si. Paul City Business Top 25 Book ojLists, 1998. Table 7 sets forth the average annual unemployment rtes for the County, the Minneapolis/St. Paul metropolitan statistical area and the State for the years 1994 to 1999, and the average annual labor force for the County for the same periods. Table 7 Unemnlovment Statistics (') Includes Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington counties. Source: Minnesota Department of Employment Security. 15 State of Hennepin County Minneapolis/ Minnesota Year Labor Force Rate St. Paul MSA°i Rate 1999 665,198 1.9% 1.6% 2.5% 1998 650,699 2.5% 2.5% 2.5% 1997 643,647 2.4% 2.5% 3.3% 1996 642,750 3.0% 3.1% 4.0% 1995 641,358 2.8% 2.9% 3.7% 1994 645,899 3.2% 3.2% 4.0% (') Includes Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington counties. Source: Minnesota Department of Employment Security. 15 Retail Sales and Buying Income Table 8 lists median household effective buying income and per capita retail sales for Hennepin County and for the State of Minnesota for the years 1994 through 1998 as reported in Sales and Marketing Management's Survey of Buying Power. Table 8 Retail Sales/Buying Income The years following 1994 are not directly comparable to previous years. Statistics are now based on money income (after tax income) rather that one personal income (income after taxes and on -tax payments.) Construction Construction activity in the City as shown by its building permit records is summarized in Table 9. Table 9 Construction Costs Estimated Construction Costs Building Permits Calendar Year Residential Commercial Issued 1998 Median Household $4,390,583 534 1997 Effective Buying Income( Per Capita Retail Sales 558 Hennepin State of Hennepin State of Year County Minnesota Coun Minnesota 1998 $43,709 $37,050 $15,162 $10,456 1997 42,467 35,737 14,209 9,946 1996 40,539 34,346 13,796 9,662 1995 38,780 32,700 13,180 9,563 1994 43,208 38,076 12,296 9,183 The years following 1994 are not directly comparable to previous years. Statistics are now based on money income (after tax income) rather that one personal income (income after taxes and on -tax payments.) Construction Construction activity in the City as shown by its building permit records is summarized in Table 9. Table 9 Construction Costs Estimated Construction Costs Building Permits Calendar Year Residential Commercial Issued 1998 $2,912,677 $4,390,583 534 1997 2,214,971 6,513,477 558 1996 503,500 1,995,654 512 1995 1,144,275 415,000 443 1994 627,850 1,802,900 610 1993 50,250 4,539,000 476 1992 224,227 444,105 593 1991 113,000 1,180,000 417 1990 2,536,750 4,199,968 395 1989 1,465,000 4,242,815 426 1988 1,356,000 1,055,000 376 Source: City of New Hope and Hennepin County. 16 Economic Development One of the City's top priorities is to address the redevelopment of its commercial and industrial properties. Commercial and industrial properties comprise about 25% of the City's total market value for taxation purposes. With over 95% of industrial and commercial properties developed, the City has taken a proactive approach to improving the community through redevelopment or expansion of its developed properties. The 42nd Avenue commercial area is one area the City has focused on in its redevelopment efforts. It has purchased several blighted properties and cleared the sites for commercial redevelopment. It is actively addressing the rehabilitation of a brownfield site that will require soil clean-up before development can occur. In 1999, 42"d Avenue underwent significant streetscape improvements improving the entrance into the community and its major commercial area. The private market has responded with redevelopment projects, namely the construction of a new Walgreens store at 42"d and Winnetka Avenues and Kmart building and site improvements. Two of the City's four major shopping centers are located in the 42' Avenue area. The four shopping centers range from 60,000 to 79,884 square feet. Winnetka Commons, located at 36' and Winnetka Avenues, was opened in 1991 and is the newest shopping center in the City. At the same time, the City is working to maintain and improve the strong industrial businesses located in New Hope. The City is working with business expansions and site improvements by local industries. Some examples include Industrial Development Revenue Bonds issued for an equipment purchase at Ware Manufacturing and approval of expansions at Paddock Laboratories and Conductive Containers, Inc. A local business is developing plans for expansion at a city -owned parcel in need of soil improvements before development. The City is planning to improve the soils on the lot and sell the parcel to be developed. The City has also used redevelopment financing to assist with the development and maintenance of senior housing units. The City recently issued Housing Revenue Bonds for Minnesota Masonic Homes to acquire the North Ridge Care Center. Minnesota Masonic Homes purchased North Ridge, the City's largest employer and second largest senior care center in Minnesota, in 1999. The City is also in the process of making its Zoning Code more flexible to encourage redevelopment. The Zoning Code Update is just one of the recommendations of the Comprehensive Plan Update, which was approved in 1999, to foster redevelopment. The Comprehensive Plan outlines not only a desired land use pattern for the City, but also a series of commercial, industrial and housing goals to guide the City. The City has always prided itself on the diversity of housing units available in the City and is very proactive in providing a variety of life -cycle housing options. This includes providing opportunities for renters and homeowners of all income levels, family status, and disability status. Recent projects have included a 34 -unit rental rehabilitation and new construction project, and the rehabilitation of two homes for purchase and the new construction of an accessible home for purchase by low -to -moderate income families. The City also operates a variety of housing assistance programs to assist with remodeling and purchasing for first-time home buyers. (The remainder of this page has been left blank intentionally). 17 Education Independent School District No. 281 provides kindergarten through grade 12 instruction for students in a 32 -square - mile area which includes the cities of New Hope, Robbinsdale, Crystal and portions of the cities of Brooklyn Center, Brooklyn Park, Golden Valley and Plymouth. The District operates 21 buildings. There are also three private schools within the District. Enrollment for the District's public schools for 1999/00 and seven previous years is outlined in Table 10. Table 10 Enrollment Statistics Year Enrollment 1999/00 13,646 1998/99 13,701 1997/98 14,081 1996/97 14,007 1995/96 14,088 1994/95 14,114 1993/94 13,678 1992/93 13,486 Source: Independent School District No. 281. (The remainder of this page has been left blank intentionally.) 18 INDEBTEDNESS General Obligation Debt Table 11 and Table 12 summarize the City's general obligation debt outstanding upon issuance of the Obligations Revenue Supported Storm Sewer 12/01/95 3.90-5.40% $1,200,000 02/01/11 $ 1,025,000 $ 960,000 Utility Revenue 05/01/99 3.254.60% 2,950,000 02/01/14 2,950,000 2,750,000 Total $ 3,975,000 $ 3,710,000 TOTAL GENERAL OBLIGATION DEBT $17.415.000 $19.060,000 Less Available Debt Service 7,462,433t�1 NET GENERAL OBLIGATION DEBT S 4.927 0) As of December 31, 1999 the City held $5,727,948, of funds available to pay debt service on tax levy and special assessment debt, $1,274,485 of tax increment funds available to pay debt service for tax increment supported debt and $460,000 of revenue funds to pay debt service for revenue supported debt. 19 Table 11 General Obligation Long -Term Debt by Issue Outstanding Debt to be Outstanding Outstanding as of Interest Original Final 12/31/99 the issuance Issue Dated Range Amount Maturity Outstanding Debt of the Bonds Special Assessment Supported Improvement 12/01/91 4.75-6.50% $2,170,000 02/01/12 $ 1,340,000 $ 1,210,000 Improvement 11/01/92 4.10-6.35% 1,735,000 02/01/09 1,205,000 1,095,000 Improvement 12/01/95 4.75-5.00% 1,600,000 02/01/12 1,390,000 1,285,000 Refunding 12/01/95 4.00-4.90% 2,935,000 02/01/06 1,460,000 1,040,000 Improvement 12/29/97 3.80-4.95% 1,520,000 02/01/13 1,415,000 1,310,000 Improvement 05/01/99 3.50.4.75% 2,205,000 02/01/19 2,205,000 2.175,000 Total $ 9,015,000 $ 8,115,000 Tax Levy Supported Certificates of Indebt. 12/01/95 3.80%-4.20% $1,200,000 12/01/00 260,000 $ 260,000 Taxable 03/01/96 5.30%-6.85% 380,000 02/01/11 325,000 305,000 Certificates of Indebt 12/29/97 3.800/-4.2% 1,370,000 12/01/02 860,000 860,000 Refunding 03/01/98 3.60%-4.4% 1,510,000 02/01/10 1,405,000 1,300,000 Certificates of Indebt 04/01/00 4.55.4.80% 1,240,000 04/01/05 -- 1,240,000 Total $ 2,850,000 $ 3,965,000 Tax Increment Supported Refunding 02/01/94 3.104.25% $2,605,000 02/01/04 $ 1,575,000 $ 1,235,000 Bonds 04/01/00 5.00% 2,035,000 02/01/08 -- 2,035,000 Total $ 1,575,000 $ 3,270,000 Revenue Supported Storm Sewer 12/01/95 3.90-5.40% $1,200,000 02/01/11 $ 1,025,000 $ 960,000 Utility Revenue 05/01/99 3.254.60% 2,950,000 02/01/14 2,950,000 2,750,000 Total $ 3,975,000 $ 3,710,000 TOTAL GENERAL OBLIGATION DEBT $17.415.000 $19.060,000 Less Available Debt Service 7,462,433t�1 NET GENERAL OBLIGATION DEBT S 4.927 0) As of December 31, 1999 the City held $5,727,948, of funds available to pay debt service on tax levy and special assessment debt, $1,274,485 of tax increment funds available to pay debt service for tax increment supported debt and $460,000 of revenue funds to pay debt service for revenue supported debt. 19 N O N M M 01 O N �O N v1 vl Q� Vl �•. M V v1 ? vt � h OO N T 00 \O vl Vl-. p. U .-. b V N[�� b V O oo �O 7 M •-. 00 O � � F � O< r oo 'n '+t 'n O fA ' p' 0 0 C C 0 C 0 C 0 C 0 C 0 C 0 C 7 P 0 ZU N Oil G NVNi V MT�O U �� cs 0 0 0 0 0 0 0 0 0 0 I O O O O O O ,O. vi vi vi O vi -� Pn N N N N N N � F O v .p �.0-0 i W y d U U N O M O� r 7 M 00 n^ ap N V R N r GQ. ti ❑ v rA 0 0 0 �� o C C C C C C C C C C 0 is0 0 N Q oonMn�000 o'n o+N o. a O � q o. 0 o 0 0 0 0 0 0 0 0 0 0 0 0 0 v, 000000000000 n n oo O\ co V.w .N. 00 � 7 �D n N O� V b to N O 00 �O M- N— U N—�-+ r .N N M M ------ N N N O V y d N rA 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 0 0 C C C C C C C C C C C C C 0 0 0 N U hOO h OO h O viO vi 'nh vih vi vi 'n '� � = M \O M h h ^ DD ^ aO n n M M M N N N N Ln 4 h� 69 y 0 0 0 0 0 0 0 0 0 0 ^ ^ 0 N N N N N. N N 0 N N N N F N Revenue Debt The following table contains the City's only revenue debt (This Issue). Table 13 Revenue Debt Annual Maturity Schedule Year Principal Interest Total 2000 $ -- $12,558 $ 12,558 2001 25,000 36,908 61,908 2002 20,000 35,530 55,530 2003 20,000 34,305 54,305 2004 20,000 33,073 53,073 2005 20,000 31,833 51,833 2006 20,000 30,593 50,593 2007 25,000 29,198 54,198 2008 25,000 27,648 52,648 2009 25,000 26,098 51,098 2010 25,000 24,548 49,548 2011 30,000 22,835 52,835 2012 30,000 20,960 50,960 2013 30,000 19,085 49,085 2014 35,000 17,054 52,054 2015 35,000 14,866 49,866 2016 40,000 12,513 52,513 2017 40,000 9,983 49,983 2018 40,000 7,433 47,433 2019 45,000 4,701 49,701 2020 50,000 1.625 51,625 Total $600.000 $453.34 1 OS 34 Debt Limit The debt limit imposed on New Hope by Minnesota Law is 2% of the market value of the taxable property in the City. M.S.A. Section 475.53 provides: Except as otherwise provided in Section 475.51 no municipality, except a school district or a city of the fust class, shall incur or be subject to a net debt in excess of 2.00 percent of the market value of taxable property. M.S.A. Section 475.51 provides in relevant part: "Net Debt" means the amount remaining after deducting from its gross debt the amount of current revenues which are applicable within the current fiscal year to the payment of any debt, and the aggregate of the principal of the following: 21 (1) Obligations issued for improvements which are payable wholly or partly from the proceeds of special assessments levied upon property specially benefited thereby, including those which are general obligations of the municipality issuing them, if the municipality is entitled to reimbursement in whole or in part from the proceeds of the special assessments. (5) Obligations issued for the acquisition and betterment of public waterworks systems, and public lighting, heating or power systems, and of any combination thereof of for any other public convenience from which a revenue is or may be derived. (7) Amount of all money and the face value of all securities held as a sinking fund for the extinguishment of obligations other than those deductible under this subdivision. (11) All other obligations which under the provisions of the law authorizing their issuance are not to be included in computing the net debt of the municipality. Table 14 Debt Limit Computation (As of March 3, 2000) Indicated market value, 1998/1999 Debt limit - 2% of market value Amount of debt applicable to debt limit: Total bonded debt Less debt exempt from limit: Special assessment supported Tax increment/redevelopment Revenue supported Total debt not subject to limitation Total debt subject to limitation Legal Debt Margin $867,041,100 $ 17,340,822 19,060,000 8,115,000 3,270,000 3,710,000 15,095,000 3,965,000 $ 13.385 822 77.14° (The remainder of this page has been left blank intentionally.) 22 Overlapping Debt There are four taxing jurisdictions with outstanding debt which overlap the City. Table 15 sets forth the general obligation debt for those jurisdictions and the amount of that debt allocable to the City as of December 31, 1999. Overlapping Entity Hennepin Countyf�1 Metropolitan Councif'1 Hennepin Parks") ISD 281 Total Table 15 Overlapping General Obligation Debt % of Debt Allocable Portion of Debt Gross Deb P'1 to the Ci ri Allocable to the City $165,060,000 1.52% $2,508,912 121,345,000 1.52% 1,844,444 18,080,000 2.10% 379,680 18,900,000 21.30% 4,025,700 $323.385.000 t'1 Total debt is debt which is secured in whole or in part by the authority to levy taxes on real estate. Pursuant to Minnesota Statutes, Section 475.5 1, net debt amounts are determined by deducting from total debt the cash available for servicing the debt and debt which is intended to be financed primarily by revenues other than a real estate tax levy. o) Excludes general obligation revenue debt of $120,005,000 which is payable from fees. o) Excludes $539,225,000 (as of 12/31/99) relating to the acquisition and improvement of sewer systems in the seven -county metropolitan area. Such debt is self-supporting from revenue collected from area communities. Metropolitan Regional Transit Board debt is included under the Metropolitan Council. (4) As of December 1, 1999. Source: Hennepin County Auditor and individual entities. Future Financing The City plans on issuing no additional debt within the next six months. (The remainder of this page has been left blank intentionally.) 23 FINANCIAL INFORMATION Financial Report The City's accounting system is organized and operated on a fund basis using the modified accrual basis (the proprietary funds use the accrual basis) of accounting. The City's financial statements are available upon request for the years ended December 31, 1996 through 1998. Results of Operations Statements of revenues and expenditures of the City's General Fund have been compiled from information contained in the City's financial statements and organized in a manner to facilitate year-to-year comparison. Table 16 presents statements of revenues and expenditures for the Golf Course Fund for the years 1996 through 1999. Table 16 Statement of Revenues, Expenditures and Changes in Fund Balance for the Golf Course Fund (Years Ended December 31) Operating Revenue: Charges for Services Rentals Concessions and sales Other Total Operating Revenue Operating Expenses: Costs of goods sold Personal services Supplies Other services and charges Depreciation Other Total Expenses Operating Income (loss) Other Revenue (expense) Interest Revenue Interest Expense Gain on Sale of Equipment Other revenue(expense) -net Income (loss) before transfers Operating transfers from (to) other funds From other funds To other funds Net Income (loss) Retained earnings January 1 Retained earnings (deficit) December 31 Unaudited 1999 $288,673 11,075 44,952 31,432 $376,122 1998 $281,931 11,365 51,767 30,488 $375,551 1997 1996 $274,067 $212,423 10,849 8,564 43,074 38,510 10,771 10,105 $338,761 $269,602 $ 33,339 $ 35,568 $ 28,637 $ 26,057 169,981 158,165 140,348 129,895 38,051 23,379 19,294 16,019 50,336 60,904 50,133 57,168 34,114 30,117 31,972 34,476 984 1,028 1,207 639 $326,805 $309,161 $271,591 $264,254 49,327 66,390 67,170 5,348 4,357 11,107 6,187 2,223 (1,214) (1,587) 3,639 6,782 11,107 6,187 636 56,109 77,497 73,357 5,984 $05,000) 5.000) $ $ $ 41,109 77,497 73,357 5,984 681,646 604,149 530,792 524,808 $722,755 $681,646 $604,149 $530,792 24 The Budgetary Process The City's formal budget preparation process begins in July of each year when the City Manager reviews departmental budget data with City department heads. At the end of August, when the amount of local government aid for the budget year is known, a proposed budget is presented to the City Council for approval. The proposed budget as approved and the amount of the tax levy for the coming year is then submitted to Hennepin County by September 15 as required by State law. Following the mailing of truth -in -taxation notices by the County and public hearings, the formal appropriation budget is approved by Council resolution in mid-December. Expenditures may not legally exceed budgeted appropriations at the fund level. Monitoring of budgets is maintained at the expenditure category level. Formal budgetary integration is employed as a management control mechanism during the year for the general fund and revenues are continuously monitored and compared to budget estimates. Cash balances from the general fund are invested in U.S. Government obligations, certificates of deposit and other securities permitted by State law. Brokers and other financial intermediaries who invest City funds are required to submit periodic statements to the City showing conformity of investments with applicable legal requirements. Table 17 presents the City's 2000 Golf Course Fund Adopted Budget. Table 17 2000 Adopted Operating Revenues: Green Fees $300,000 Concessions 16,000 Rentals 10,000 Merchandise Sales 35,000 League & Lesson Registration 25,000 Other 8,000 Total Revenues $394,000 Operating Expenses: Personal Services 167,215 Supplies 79,550 Other Services and Charges 44,291 Total Expenditures $291,056 Operating Income (Loss) Before Depreciation 102,994 Depreciation 32,000 Operating Income (Loss) 70,994 Other Revenue (Expenses) Interest Earrings 10,000 Interest Expense Total Revenue (Expense) 10,000 Net Income (Loss) 80,944 Retained Earnings January 1 732,438 Retained Earnings December 31 $813.38 25 Investment Policy The City's investment policy states that the City will invest its funds in a manner which will provide the highest investment return with the maximum security while meeting the cash flow demands of the City and conforming to all state and local statutes governing the investment of public funds. Safety of principal is the foremost objective, followed closely in priority by liquidity and return on investment. The City invests funds only with financial institutions that have demonstrated financial stability. Banks outside of the Minneapolis/St. Paul seven -county metropolitan area and investment firms are restricted to those having minimum capital and surplus of $10,000,000. The City adheres to those investments permitted by Minnesota Statues, Chapter 118A, which include U.S. Government obligations, federal agency issues which are not directly guaranteed by the U.S. Government, shares in mutual funds investing exclusively in U.S. Government and agency issues, obligations of the State of Minnesota or Minnesota municipalities, bankers' acceptances of specified U.S. banks eligible for purchase by the Federal Reserve System, highest quality commercial paper maturing in 270 days or less issued by U.S. corporations or their Canadian subsidiaries, and interest-bearing bank deposits. The City diversifies investments by security type and institution, with a goal of investing no more than 50% of its investment portfolio in a single security type or financial institution. Maturities of investments are matched to the extent possible with anticipated cash requirements; at no time are more than 50% of funds invested in securities with maturities greater than five years. Compliance with the City's investment policy and with stated performance standards is ensured both by internal controls and independent annual review by an external auditor. As of December 31, 1999, the City's funds were invested in the following types of securities: Type of Investment Percentage U.S. Government securities 46.9% Money market funds 27.0% Negotiable certificates of deposit 17.1% Bank Accounts 5.1% State and Local Securities 3.9% CERTIFICATION The officers of the City will furnish a statement to the effect that this Official Statement, to the best of its knowledge and belief as of the date of sale and the date of delivery, is true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made herein, in light of the circumstances under which they were made, not misleading. 26 NO CONTINUING DISCLOSURE The City is not subject to the requirements of SEC Rule 15c2-12 since the principal amount of the Bonds is less than $1,000,000. MISCELLANEOUS Any statements made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of those estimates will be realized. The execution and delivery of this Official Statement by its finance director has been duly authorized by the City. By: /s/ Daryl Sulander Finance Director City of New Hope 27 (This page has been left blank intentionally.) APPENDIX A Financial Statements for the Year Ending December 31, 1998 (This page has been left blank intentionally.) _ | k # � EE E ' | _ !! k |!) | | k|( \- � \� ( | !2| EE E ' | _ !! k |!) | | k|( EE E ' | ( | !2| . „■;�5!■ - • - ;El�:: § R | | ! | u ' � | �|! ! ,l�•� !�! |! !�!t|�I||! �:1�.,=� -|.. - ., ��•,, . !.:! & � ' §■$r«■# !I! -M ■■�s■■, „■;�5!■ - • - ;El�:: § R | | ! | u ' � | �|! ! ,l�•� !�! |! !�!t|�I||! �:1�.,=� -|.. - ., ��•,, . !.:! all | | ! 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MINNEAPOLIS NEW YORK SEATTLE DENVER WASHINGTON, D.C. DES MOINES ANCHORAGE LONDON COSTA MESA City of New Hope New Hope, Minnesota DORSEY & WHITNEY LLP PILLSBURY CENTER SOUTH 220 SOUTH SIXTH STREET MINNEAPOLIS, MINNESOTA 55402-1498 TELEPHONE: (612) 340-2600 FAX: (612) 340-2868 Re: $600,000 Golf Course Gross Revenue Bonds, Series 2000B City of New Hope, Hennepin County, Minnesota Ladies and Gentlemen: BILLINGS GREAT FALLS MISSOULA BRUSSELS FARGO HONG KONG ROCHESTER SALT LAKE CITY VANCOUVER As Bond Counsel in connection with the authorization, issuance and sale by the City of New Hope, Hennepin County, Minnesota (the "City"), of its Golf Course Gross Revenue Bonds, Series 2000B dated, as originally issued, as of April 1, 2000, in the total principal amount of $600,000 (the "Bonds"), we have examined certified copies of certain proceedings taken, and certain affidavits and certificates furnished, by the City in the authorization, sale and issuance of the Bonds, including the form of the Bonds. As to questions of fact material to our opinion we have assumed the authenticity of and relied upon the proceedings, affidavits and certificates furnished to us without undertaking to verify the same by independent investigation. From our examination of such proceedings, affidavits and certificates, and based upon laws, regulations, rulings and decisions in effect on the date hereof, it is our opinion that: The Bonds are valid and binding obligations of the City enforceable in accordance with their terms. 2. The principal of and interest on the Bonds are payable solely and exclusively from the gross revenues derived by the City from the operation of its municipal golf course. The City is authorized under certain circumstances to issue additional revenue obligations on a parity of lien with the Bonds. The Bonds are not general obligations of the City and the taxing power of the District is not to be used to provide money for the payment of the principal thereof or interest thereon. 3. Interest on the Bonds (a) is not includable in gross income for federal income tax purposes or in taxable net income of individuals, estates or trusts for Minnesota income tax purposes; (b) is includable in taxable income of corporations and financial institutions for purposes of the Minnesota franchise tax; (c) is not an item of tax preference includable in alternative minimum taxable income for purposes of the federal alternative minimum tax applicable to all taxpayers or the Minnesota alternative minimum tax applicable to individuals, estates and trusts; and (d) is includable in adjusted current earnings of corporations in determining alternative minimum taxable income for purposes of the federal alternative minimum tax imposed on corporations. DORSEY & WHITNEY LLP City of New Hope, Minnesota Page -2- 4. The City has designated the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), and, financial institutions described in Section 265(b)(5) of the Code may treat the Bonds for purposes of Section 265(b)(2) and 291(e)(1)(B) of the Code as if they were acquired on August 7, 1986. The opinions expressed in paragraphs 1 and 2 are subject as to enforceability to the effect of any state or federal laws relating to bankruptcy, insolvency, reorganization, moratorium or creditors' rights and the exercise of judicial discretion. The opinions set forth in paragraphs 3 and 4 are subject to the condition that the City comply with all the requirements of the Code that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes, and the Bonds be and continue to be qualified tax-exempt obligations. The City has covenanted in the resolution authorizing the issuance of the Bonds to comply with these continuing requirements. Failure of the City to comply with these requirements may result in the inclusion of interest on the Bonds in federal gross income and in Minnesota taxable net income, retroactive to the date of issuance of the Bonds. Except as stated in this opinion, we express no opinion regarding federal, state or other tax consequences to owners of the Bonds. We have not been asked, and have not undertaken, to review the accuracy, completeness or sufficiency of any offering materials relating to the Bonds, and accordingly, we express no opinion with respect thereto. Dated: April _, 2000 Very truly yours, CERTIFICATION OF MINUTES RELATING TO $600,000 GOLF COURSE GROSS REVENUE BONDS, SERIES 2000B Issuer: City of New Hope, Minnesota Governing body: City Council Kind, date, time and place of meeting: A regular meeting held on March 13, 2000, at 7:00 o'clock P.M., at the New Hope City Hall. Members present: Enck, Cassen, Collier, Norby, Thompson Members absent: None Documents attached: Minutes of said meeting including (pages): I through 20 RESOLUTION NO. 00- 58 RESOLUTION RELATING TO $600,000 GOLF COURSE GROSS REVENUE BONDS, SERIES 200013; AWARDING THE SALE, FIXING THE FORM AND DETAILS AND PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF AND SECURITY THEREFOR I, the undersigned, being the duly qualified and acting recording officer of the public corporation issuing the obligations referred to in the title of this certificate, certify that the documents attached hereto, as described above, have been carefully compared with the original records of the corporation in my legal custody, from which they have been transcribed; that the documents are a correct and complete transcript of the minutes of a meeting of the governing body of the corporation, and correct and complete copies of all resolutions and other actions taken and of all documents approved by the governing body at the meeting, insofar as they relate to the obligations; and that the meeting was duly held by the governing body at the time and place and was attended throughout by the members indicated above, pursuant to call and notice given as required by law. WITNESS my hand officially as such recording officer this 13th day of March , 2000. Valerie Leone, City Clerk It was reported that two (_L) proposals had been received prior to 10:00 a.m., Central Time today for the purchase of the $600,000 Golf Course Gross Revenue Bonds, Series 2000B of the City in accordance with the Official Statement distributed by the City to potential purchasers of the Bonds. The proposals have been read and tabulated, and the terms of each have been determined to be as follows: Bid for Interest Net Interest Name of Bidder Principal Rates Cost [See attached] EVENSEN DODGE INC RESULTS OF SALE SALE DATE: MARCH 13, 2000 $600,000 Golf Course Revenue Bonds, Series 2000B City of New Hope, Minnesota Due: February 1, 2001-2020 Dated: April 1, 2000 Rating: Not Rated Bank Qualified: Yes BBI: 5.89% BIDDERS Address Year Rate Yield BERNARDI SECURITIES, INC. Chicago, IL 2001 6.125% 5.00% Price 2002 6.125% 5.10% 2003 6.125% 5.20% $ 591,000.70 2004 6.20% 5.30% 2005 6.20% 5.40% NIC 2006 6.20% 5.50% 2007 6.20% 5.60% $ 462,341.59 2008 6.20% 5.70% 2009 6.20% 5.80% TIR 2010 6.20% 5.85% 2011 6.25% 5.90% 6.5116% 2012 6.25% 6.00% 2013 6.25% 6.05% 2014 6.25% 6.10% 2015 6.25% 6.25% 2016 6.30% 6.30% 2017 6.35% 6.35% 2018 6.40% 6.40% 2019 6.45% 6.45% 2020 6.50% 6.50% JOHN G. KINNARD & CO., INC. Minneapolis, MN 2001 5.75% Price 2002 5.75% 2003 5.75% $ 591,000.00 2004 5.75% 2005 5.75% NIC 2006 6.15% 2007 6.15% $ 471,752.08 2008 6.15% 2009 6.15% TIR 2010 6.15% 2011 6.25% 6.6227% 2012 6.25% 2013 6.25% 2014 6.25% 2015 6.50% 2016 6.50% 2017 6.50% 2018 6.75% 2019 6.75% 2020 6.75% W: \F Doc „, ,,, u, •i„. A, _, Councilmember Norby then introduced the following resolution and moved its adoption: RESOLUTION NO. 00- 58 RESOLUTION RELATING TO $600,000 GOLF COURSE GROSS REVENUE BONDS, SERIES 200013; AWARDING THE SALE, 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 New Hope, Minnesota (the "City"), as follows: Section 1. Recitals. Authorization and Sale of Bonds. 1.01. Authorization. The City owns and operates a municipal golf course (the "Facilities") as an enterprise fund of the City. To finance the construction of a new clubhouse for the Facilities this Council hereby determines to issue and sell $600,000 principal amount of Golf Course Gross Revenue Bonds, Series 2000B, of the City (the "Bonds"), including every item of cost of the kinds authorized in Minnesota Statutes, Section 475.65, and $9,000 representing interest as provided in Minnesota Statutes, Section 475.56. 1.02. Sale of Bonds. The City has retained Evensen Dodge Inc., an independent financial advisor, to assist the City in connection with the sale of the Bonds. The Bonds are being sold pursuant to Minnesota Statutes, Section 475.60, Subdivision 2, paragraph (9), without meeting the requirements for public sale under Minnesota Statutes, Section 475.60, Subdivision 1. Pursuant to the Terms and Conditions of Sale for the Bonds, two (-L) proposals for the purchase of the Bonds were received at or before the time specified for receipt of proposals. The proposals have been publicly read and considered, and the purchase price, interest rates and net interest cost under the terms of each proposal have been determined. The most favorable proposal received is that of Bernardi Securities, Inc. sof Chicago , Illinois ,and associates (the "Purchaser"), to purchase the Bonds at a price of $ 591,000. 70 , the Bonds to bear interest at the rates set forth in Section 3.01. The proposal is hereby accepted, and the Mayor and the City Manager are hereby authorized and directed to execute a contract on the part of the City for the sale of the Bonds with the Purchaser. The good faith checks of the unsuccessful bidders shall be returned forthwith. 1.03. Performance of Requirements. The City is authorized by Minnesota Statutes, Section 471.191, to issue and sell the Bonds to pay the costs of improvements to the Facilities, and to pledge to the payment of the Bonds the gross revenues to be derived from charges for the service, use and availability of the Facilities. The City does not have any outstanding obligations which constitute a lien on the revenues of the Facilities. All acts, conditions and things which are required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be performed precedent to and in the valid issuance of the Bonds having been done, existing, having happened and having been performed, it is now necessary for this Council to establish the form and terms of the Bonds, to provide security therefor and to issue the Bonds forthwith. form: Section 2. Form of Bonds. The Bonds shall be prepared in substantially the following -2- Interest Rate REGISTERED OWNER: PRINCIPAL AMOUNT: UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF NEW HOPE GOLF COURSE GROSS REVENUE BOND, SERIES 2000B Maturity February 1, Date of Orieinal Issue April 1, 2000 CUSIP DOLLARS THE CITY OF NEW HOPE, Hennepin County, Minnesota (the "City"), acknowledges itself to be indebted and, for value received, hereby promises to pay solely from revenues appropriated and pledged to the Revenue Bond Account of its Golf Course Fund, as a lien and charge upon the gross revenues derived from time to time from the operation by the City of its municipal golf course (the "Facilities"), to the registered owner named above, or registered assigns, the principal amount specified above, on the maturity date specified above, with interest thereon from the date of original issue specified above, or from the most recent interest payment date to which interest has been paid or duly provided for, at the annual rate specified above. Interest hereon is payable on February 1 and August 1 in each year, commencing August 1, 2000, to the person in whose name this Bond is registered at the close of business on the 15th day (whether or not a business day) of the immediately preceding month, all subject to the provisions referred to herein with respect to the redemption of the principal of this Bond before maturity. The interest hereon and, upon presentation and surrender hereof at the office of the City Finance Director, in New Hope, Minnesota, as Registrar, Transfer Agent and Paying Agent (the "Bond Registrar"), or its successor designated under the Resolution described herein, the principal hereof, are payable in lawful money of the United States of America by check or draft of the City or the Bond Registrar if a successor to the City Finance Director as Bond Registrar has been designated under the Resolution described herein. -3- This Bond is one of an issue in the aggregate principal amount of $600,000 (the "Bonds") all of like date and tenor except as to serial number, interest rate, redemption privilege and maturity date, issued pursuant to a resolution adopted by the City Council on March 13, 2000 (the "Resolution"), for the purpose of financing the costs of improvements to the Facilities and is issued pursuant to and in full conformity with the provisions of the Constitution and laws of the State of Minnesota thereunto enabling, including Minnesota Statutes, Section 471.191 and Chapter 475. Said Bonds and the interest thereon are payable solely and exclusively from the gross revenues derived from the operation of the Facilities which have been pledged to the payment thereof and do not constitute a debt of the City within the meaning of any constitutional or statutory limitation of indebtedness, and the full faith and credit and taxing power of the City are not pledged to the payment of the principal of or interest on the Bonds. Additional revenue obligations may be issued on a parity of lien upon the gross revenues of the Facilities with the Bonds of this issue as provided in the Resolution. The Bonds are issuable only as fully registered bonds in denominations of $5,000 or any multiple thereof, of single maturities. Bonds maturing in the years 2001 through 2007 are payable on their respective stated maturity dates without option of prior payment, but Bonds having stated maturity dates in the years 2008 through 2020 are each subject to redemption and prepayment, at the option of the City and in whole or in part, and if in part, in the maturities selected by the City and, within any maturity, in $5,000 principal amounts selected by lot, on February 1, 2007 and on any date thereafter, at a price equal to the principal amount thereof to be redeemed plus accrued interest to the date of redemption. At least thirty days prior to the date set for redemption of any Bond, notice of the call for redemption will be mailed to the Bond Registrar and to the registered owner of each Bond to be redeemed at his address appearing in the Bond Register, but no defect in or failure to give such mailed notice of redemption shall affect the validity of the proceedings for the redemption of any Bond not affected by such defect or failure. Official notice of redemption having been given as aforesaid, the Bonds or portions of the Bonds so to be redeemed shall, on the redemption date, become due and payable at the redemption price herein specified and from and after such date (unless the City shall default in the payment of the redemption price) such Bond or portions of Bonds shall cease to bear interest. Upon the 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(b) of the Internal Revenue Code of 1986, as amended. As provided in the Resolution and subject to certain limitations set forth therein, this Bond is transferable upon the books of the City at the principal office of the Bond 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 Bond Registrar, duly executed by the -4- registered owner or his attorney; and may also be surrendered in exchange for Bonds of other authorized denominations. Upon such transfer or exchange, the City will cause a new Bond or Bonds to be issued in the name of the transferee or registered owner, of the same aggregate principal amount, bearing interest at the same rate and maturing on the same date, subject to reimbursement for any tax, fee or governmental charge required to be paid with respect to such transfer or exchange. The City and the Bond 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 Bond Registrar shall be affected by any notice to the contrary. IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be performed precedent to and in the issuance of this Bond in order to make this Bond a valid and binding special obligation of the City according to its terms, have been done, do exist, have happened and have been performed in regular and due form as so required; the City has covenanted and agreed with the holder hereof that until this bond is fully paid or discharged as provided in the Resolution there will be maintained on the official books and records of the City a separate and special Golf Course Fund, into which will be paid as received all gross revenues derived from the operation of the Facilities, and there will be maintained therein a separate and special Revenue Bond Account to which shall be irrevocably pledged and appropriated and credited on a periodic basis, as a lien and charge on all such gross revenues, a sum sufficient to ensure a balance therein at all times adequate to pay all principal and interest as such becomes due and payable on all bonds payable from the Golf Course Fund during any subsequent twelve month period; that reasonable rates and charges for all services and commodities furnished and made available by and through the Facilities will be established, maintained and revised when necessary and will be imposed and collected for the use of such Facilities in accordance with schedules such that the revenues derived therefrom in each year will be sufficient to enable the City to make the required deposit in the Revenue Bond Account, and that the revenues received in excess of such requirements, together with any other funds legally available which the City shall determine to include and provide for in its budget, will be sufficient to pay promptly as incurred all current, reasonable and necessary costs of the operation and maintenance of the Facilities, and to provide for necessary replacements and improvements thereof; that if necessary for payment of costs of operating and maintaining the Facilities the City will levy an ad valorem tax on all taxable property within the City, subject to the limitations imposed upon general purpose City tax levies; that the Resolution contains other covenants for the security of this Bond which will be promptly and fully performed as stipulated therein; and that the issuance of this Bond does not cause the indebtedness of the City to exceed any constitutional or statutory limitation. 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 hereon shall have been -5- executed by the Bond Registrar by the manual signature of the Bond Registrar, or in the event the City Finance Director is no longer acting as Bond Registrar, one of the authorized representatives of the Bond Registrar. IN WITNESS WHEREOF, the City of New Hope, Hennepin County, Minnesota, by its City Council, has caused this Bond to be executed by the facsimile signatures of the Mayor and the City Manager and has caused this Bond to be dated as of the date set forth below. Date of Authentication: City Manager CITY OF NEW HOPE Mayor CERTIFICATE OF AUTHENTICATION This is one of the Bonds delivered pursuant to the Resolution mentioned within. By City Finance Director, as Bond Registrar 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 in common TEN ENT — — as tenants by the entireties UNIF TRANS MIN ACT....... Custodian....... . (Cust) (Minor) JT TEN — — as joint tenants with right of survivorship and not as tenants in common under Uniform Transfers to Minors Act...................... (State) Additional abbreviations may also be used. -6- 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(s) must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Bond Registrar, which requirements include membership or participation in the Securities Transfer Association Medal ion Program (STAMP) or such other "signature guaranty program" as may be determined by the Bond Registrar in addition to or in substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. NOTICE: The signature(s) 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. Section 3. Bond Terms. Execution and Delivery. 3.01. Maturities, Interest Rates, Denominations, Payment. Dating of Bonds. The City shall forthwith issue and deliver the Bonds, which shall be denominated "Golf Course Gross Revenue Bonds, Series 2000B." The Bonds shall be dated as of April 1, 2000, shall be issuable in the denominations of $5,000 or any integral multiple thereof, shall mature on February I in the years and amounts set forth below, and Bonds maturing in such years and amounts shall bear interest from date of -7- issue until paid or duly called for redemption at the rates per annum set forth opposite such years and amounts as follows: Year Amount Rate Year Amount 2001 $25,000 6.125% 2011 $30,000 2002 20,000 6.125% 2012 30,000 2003 20,000 6.125% 2013 30,000 2004 20,000 6.20 % 2014 35,000 2005 20,000 6,20 % 2015 35,000 2006 20,000 6.20 % 2016 40,000 2007 25,000 6.20 % 2017 40,000 2008 25,000 6.20 % 2018 40,000 2009 25,000 6.20 % 2019 45,000 2010 25,000 6.20 % 2020 50,000 Rate 6.25 % 6.25% 6.25% 6.25% 6.25% 6.30% 6.35% 6.40% 6.45% 6.50% The Bonds shall be issuable only in fully registered form, of single maturities. The interest thereon and, upon surrender of each Bond at the principal office of the Registrar described herein, the principal amount thereof, shall be payable by check or draft issued by the Registrar. Each Bond shall be dated by the Registrar as of the date of its authentication. 3.02. Interest Payment Dates. Interest on the Bonds shall be payable on February I and August 1 in each year, commencing August 1, 2000, to the owners thereof as such appear of record in the bond register as of the close of business on the fifteenth day of the immediately preceding month, whether or not such day is a business day. Interest on the Bonds will be computed on the basis of a 360 -day year consisting of twelve 30 -day months and will be rounded pursuant to the rules of the Municipal Securities Rulemaking Board. 3.03. Registration. The City shall appoint, and shall maintain, a bond registrar, transfer agent and paying agent (the Registrar). The effect of registration and the rights and duties of the City and the Registrar with respect thereto shall be as follows: (a) Register. The Registrar shall keep at its principal office a bond register in which the Registrar shall provide for the registration of ownership of Bonds and the registration of transfers and exchanges of Bonds entitled to be registered, transferred or exchanged. (b) Transfer of Bonds. 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 In 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 after the fifteenth day of the month preceding each interest payment date and until such interest payment date. (c) Exchange of Bonds. Whenever any Bond is surrendered by the registered owner for exchange, the Registrar shall authenticate and deliver one or more new Bonds of a like aggregate principal amount, interest rate and maturity, as requested by the registered owner or the owner's attorney duly authorized in writing. (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) Improper 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 its 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 or exchange of Bonds (except for 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 lost, stolen or destroyed, the Registrar shall deliver a new Bond of like amount, number, interest rate, 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 lost, stolen or destroyed, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case of a Bond lost, stolen or destroyed, upon receipt by the Registrar of evidence satisfactory to it that such Bond was lost, stolen or destroyed, and of the ownership thereof, and upon receipt by the Registrar of an appropriate bond or indemnity in 0 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, lost, stolen or destroyed Bond has already matured or been called for redemption in accordance with its terms, it shall not be necessary to issue a new Bond prior to payment. 3.04. Appointment of Initial Re isg tray. The City hereby appoints the City Finance Director, as the initial Registrar. In the event that the City determines to discontinue the book entry -only system for the Bonds as described in paragraph (c) of Section 3.07, or DTC, as defined in Section 3.07, determines to discontinue providing its services with respect to the Bonds and a new securities depository is not appointed for the Bonds, the City will designate a suitable bank or trust company to act as successor Registrar if the City Finance Director is then acting as Registrar. The City reserves the right to remove any Registrar upon thirty (30) days' notice and upon the appointment of a successor Registrar, in which event the predecessor Registrar shall deliver all cash and Bonds in its possession to the successor Registrar. 3.05. Redemption. Bonds maturing in the years 2001 through 2007 are payable on their respective stated maturity dates without option of prior payment, but Bonds maturing in 2008 through 2020 are each subject to redemption, at the option of the City and in whole or in part, and if in part, in the maturities selected by the City and, within any maturity, in $5,000 principal amounts selected by the Registrar by lot, on February 1, 2007 and on any date thereafter, at a redemption price equal to the principal amount thereof to be redeemed plus accrued interest to the date of redemption. At least thirty days prior to the date set for redemption of any Bond, the City shall cause notice of the call for redemption to be mailed to the Registrar and to the registered owner of each Bond to be redeemed, but no defect in or failure to give such mailed notice of redemption shall affect the validity of proceedings for the redemption of any Bond not affected by such defect or failure. The notice of redemption shall specify the redemption date, redemption price, the numbers, interest rates and CUSIP numbers of the Bonds to be redeemed and the place at which the Bonds are to be surrendered for payment, which is the principal office of the Registrar. Official notice of redemption having been given as aforesaid, the Bonds or portions thereof so to be redeemed shall, on the redemption date, become due and payable at the redemption price therein specified and from and after such date (unless the City shall default in the payment of the redemption price) such Bonds or portions thereof shall cease to bear interest. Bonds in a denomination larger than $5,000 may be redeemed in part in any integral multiple of $5,000. The owner of any Bond redeemed in part shall receive without charge, upon surrender of such Bond to the Registrar, one or more new Bonds in authorized denominations equal in principal amount to be unredeemed portion of the Bond so surrendered. W11 3.06. Preparation and Delivery. The Bonds shall be prepared under the direction of the City Manager and shall be executed on behalf of the City by the signatures of the Mayor and the City Manager; provided that said signatures may be printed, engraved, or lithographed facsimiles thereof. 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 and until a certificate of authentication on such Bond has been duly executed by the manual signature of the Registrar, or in the event the City Finance Director is no longer acting as Registrar, an authorized representative of the Registrar. Certificates of authentication on different Bonds need not be signed by the same representative. The executed certificate of authentication on each Bond shall be conclusive evidence that it has been authenticated and delivered under this Resolution. When the Bonds have been so executed and authenticated, they shall be delivered by the City Manager to the Purchaser upon payment of the purchase price in accordance with the contract of sale heretofore made and executed, and the Purchaser shall not be obligated to see to the application of the purchase price. 3.07. Securities Depository. (a) For purposes of this Section the following terms shall have the following meanings: "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 Bonds as securities depository. "Representation Letter" shall mean the Representation Letter from the City to DTC previously executed by the City and on file with DTC. (b) The Bonds shall be initially issued as separately authenticated fully registered bonds, and one Bond shall be issued in the principal amount of each stated maturity of the Bonds. Upon initial issuance, the ownership of such Bonds shall be registered in the bond register in the name of Cede & Co., as nominee of DTC. The Registrar and the City may treat DTC (or its nominee) as the sole and exclusive owner of the Bonds registered in its name for the purposes of payment of the principal of or interest on the Bonds, selecting the Bonds or portions thereof to be redeemed, if any, giving any notice permitted or required to be given to registered owners of Bonds under this resolution, registering the transfer of Bonds, and for all other purposes whatsoever; and neither the Registrar nor the City shall be affected by any notice to the contrary. Neither the Registrar nor the City shall have any responsibility or obligation to any Participant, any person claiming a beneficial ownership interest in the Bonds under or through DTC or any Participant, or any other person which is not shown on the bond register as being a registered owner of any Bonds, with respect to the accuracy of any records maintained by DTC or any Participant, with respect to the payment by DTC or any Participant of any amount with respect to the principal of or interest on the Bonds, with respect to any notice which is permitted or required to be given to owners of Bonds under this resolution, with respect to the selection by DTC or any Participant of any person to receive payment in the event of a partial redemption of the Bonds, or with respect to any consent given or other action taken by DTC as registered owner of the Bonds. So long as any Bond is registered in the name of Cede & Co., as nominee of DTC, the Registrar shall pay all principal of and interest on such Bond, and shall give all notices with respect to such Bond, only to Cede & Co. in accordance with the Representation Letter, and all such payments shall be valid and effective to fully satisfy and discharge the City's obligations with respect to the principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than DTC shall receive an authenticated Bond for each separate stated maturity evidencing the obligation of the City to make payments of principal and interest. Upon delivery by DTC to the Registrar of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., the Bonds will be transferable to such new nominee in accordance with paragraph (d) 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 (d) 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 (d) hereof. (d) 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. _12_ Section 4. Security Provisions. 4.01. The Golf Course Fund. From and after the issuance of the Bonds, all Bond proceeds as well as all of the gross income and revenue derived by the City from the service, use and availability of the Facilities, and of any further additions or improvements thereto, including all amounts received with respect to services and commodities furnished by the Facilities to any person will be set aside, appropriated and pledged to the Golf Course Fund, which will be maintained as a separate and special fund on the books of the City at least until the Bonds and the interest thereon are fully paid. The City Finance Director will maintain or cause to be maintained the books and records showing all receipts and disbursements of revenues herein pledged to the Golf Course Fund and of all other moneys pertaining to the Facilities. The Golf Course Fund shall be used for debt retirement, for payment of capital expenditures necessarily incurred for the acquisition and betterment of the Facilities, including but not limited to land, easement, buildings, structures and equipment, and the cost of all architectural, engineering, legal and other professional services, printing and publication, and to pay, promptly when due, expenses which under accepted accounting principles constitute current, reasonable and necessary costs of the operation, administration and maintenance of the Facilities. 4.02. Revenue Bond Account and Reserve Account. There is hereby established in the Golf Course Fund a separate bookkeeping account to be designated as the Revenue Bond Account (the "Revenue Bond Account'). Upon receipt of Bond proceeds, the City shall set aside any accrued interest received from the sale of the Bonds to be deposited in the Revenue Bond Account and to be used to pay the interest due on August 1, 2000 Then, from the gross revenues received by the City from the operation of the Facilities, including all proceeds of the voluntary sale of the any real and personal property comprising part of the Facilities, the City shall set aside amounts necessary to pay principal and interest on the Bonds and any additional bonds payable from the Revenue Bond Account when due. The principal payment due on the Bonds will be paid each year on February 1 and the interest will be paid on February 1 and August I of each year. This requirement is cumulative, and if the full amount required cannot be transferred on any due date, the deficiency will be restored from the next gross revenues received by the City. The Revenue Bond Account will be used only to pay the principal of and interest on the Bonds when due. The balance therein on each payment date will be used first pro rata to pay the interest then due on all of said Bonds, and then to pay the principal of the matured bonds in order of their maturity dates, and in order of the dates of issue maturing on the same date, and in the order of the serial numbers of the Bonds issued and maturing on the same dates. There is hereby established in the Golf Course Fund a separate bookkeeping account to be designated as the Reserve Account (the "Reserve Account'). Upon the issuance of the Bonds the City shall deposit in the Reserve Account from funds on hand of the City and available therefor the sum of $ 56,394.80 which is the amount equal to the lesser of (i) the average Principal and Interest -13- Requirements to become due in any future calendar year on the bonds payable from the Revenue Bond Account, (ii) the maximum Principal and Interest Requirements to become due in any future calendar year on the bonds payable from the Revenue Bond Account, or (iii) 10% of the proceeds of all series of bonds issued and made payable from the Revenue Bond Account as to which any bond of such series is then Outstanding (the "Reserve Requirement"). The Reserve Account shall be maintained at the Reserve Requirement by the retention of interest earnings therein and/or the transfer thereto of gross income and revenues derived from the operation of the facilities in excess of the requirements of the Revenue Bond Account. Except as provided below, when and if the balance in the Reserve Account is more than the Reserve Requirement, the excess shall be transferred, not less often than annually, to the Revenue Bond Account. Moneys on hand in the Reserve Account shall be used only to pay interest or principal actually due on bonds payable from the Revenue Bond Account when, if and to the extent that such interest or principal cannot be paid in full from the Revenue Bond Account; provided that the amount of the Reserve Account allocable to any series of bonds may used at any time to discharge such series of bonds in accordance with Section 6, so long as the balance remaining on hand in the Reserve Account following such use is not less than the Reserve Requirement with respect to bonds which continue to be payable from the Revenue Bond Account. The balance in the Reserve Account shall be deemed to be the sum of all cash and the amortized cost of all securities held in the Reserve Account. 4.03. Establishment of Other Accounts. The City will reserve the right to establish other Accounts in the Golf Course Fund for the purpose of segregating revenues of the Facilities for the payment of principal and interest on other bonds issued by the City to finance improvements comprising part of the Facilities, and the right to pledge revenues of the Facilities to any such Account for such purpose, subject to the prior pledge thereof to the Accounts established in Sections 4.02 through 4.05 and the lien thereon of bonds payable from the Revenue Bond Account. 4.04. Deposit and Investment of Funds. All revenues and Bond proceeds appropriated to the Golf Course Fund, when uninvested, will be kept on deposit with one or more depository banks duly qualified under the laws of the State, with security as required by law, and will be invested and reinvested so far as possible, solely in securities which are authorized by law for the investment of municipal sinking funds. All securities so purchased will mature at or before the time when it is estimated that the proceeds thereof will be needed for the purposes of the Account from which funds are withdrawn for the purchase. All income, gain and loss on such investments will be credited or charged, as the case may be, to the Account from which the investment was made. 4.05. Issuance of RefundingBonds. onds. The City reserves the right and privilege of issuing and selling refunding certificates or bonds if and to the extent needed to refund maturing bonds payable from the Revenue Bond Account, if moneys in the Golf Course Fund are at any time insufficient for the payment in full of the principal and interest due thereon, which refunding obligations shall be payable from the Revenue Bond Account on a parity with the outstanding bonds payable therefrom, but shall M not mature earlier than the final maturity of all bonds then outstanding. Nothing herein shall require the holder of any bond to accept a refunding obligation in exchange therefor. 4.06. Additional Bonds. The City hereby agrees that it will not issue any additional obligations payable from the revenues of the Facilities or constituting a lien or charge thereon superior to or on a parity with the bonds payable from the Revenue Bond Account unless it has first retired, or placed in escrow within a depository bank, moneys or securities sufficient to discharge the outstanding bonds pursuant to Section 6 hereof prior to the issuance of such additional obligations or unless the gross revenues of the Facilities in the last complete fiscal year immediately preceding the issuance of such additional obligations shall have been at least equal to 200% of the maximum amount of principal and interest to come due in any future fiscal year, during the remaining term of the outstanding bonds, on all of the outstanding bonds payable from the revenues of the Facilities and on the additional obligations then proposed to be issued. Notwithstanding the above provisions, nothing in this resolution shall be construed to preclude the City from issuing additional bonds, whether constituting a general obligation of the City or payable solely from revenues of the Facilities, for construction, reconstruction or improvement of the Facilities, provided such additional bonds are expressly made a lien and charge on the revenues of the Facilities subordinate and junior to that of the bonds payable from the Revenue Bond Account. Section 5. Additional Covenants. 5.01. General Covenant. The City covenants and agrees with the holders from time to time of all bonds payable from the Revenue Bond Account in the Golf Course Fund, or any other account established pursuant to Section 4.03 unless otherwise provided, that until all bonds payable therefrom and interest thereon are fully paid or discharged as provided herein, it will fully and promptly perform and do all additional acts and things provided in this Section 5. 5.02. Rate Covenant. The City will review the rates and charges for the use of the Facilities to insure that said rates are reasonable and in accordance with schedules such that the gross revenues derived therefrom will at all times be sufficient to pay all principal and interest on all bonds payable from the Revenue Bond Account and, together with any other funds properly appropriated by the Council, to pay all expenses payable from the Golf Course Fund when due, and will revise such rates, charges and rentals whenever necessary for these purposes. 5.03. Continued Ownership. The City will continue its ownership and operation of the Facilities, and will cause it to be maintained in good and efficient operating condition, free from all liens on the revenues or the physical properties thereof, other than the liens herein provided, and will not sell or otherwise dispose of any capital assets of the Facilities except at their fair market value and will use the proceeds of any such sale or disposition to procure other capital assets of equal usefulness for the purposes of the Facilities, or to pay and redeem bonds payable from the Revenue Bond Account. -15- 5.04. Books and Records. The City will maintain proper and adequate books of record and accounts, reflecting all receipts and disbursements and all accrued claims and expenses in connection with the operation and maintenance of the Facilities, and the payment of bonds incurred therefor, and will make such records available for inspection at all reasonable times by the holder of any such bonds or the owner's agent or attorney 5.05. Insurance. The City will procure and keep in force at all times insurance on all buildings, structures, insurable improvements, and equipment constituting at any time a part of the Facilities, exclusive of foundations and excavations, against all perils covered under "all risks" insurance provided by the Insurance Department of the State of Minnesota, in such amounts as like properties are customarily insured for prudent owners thereof, and will maintain public liability insurance at all times in amounts not less than the amounts in excess of which the City is immune from tort liability under the laws of the State of Minnesota, for all acts and omissions of its officers and employees concerned with the operation and maintenance of the Facilities, and will procure and keep in force surety company bonds covering all officers and employees handling the Club's funds, in amounts sufficient to cover at all times the funds in their hands. In the event of loss or damage compensated by any such insurance or bonds, the proceeds thereof will be used to repair and restore the damage compensated. 5.06. Bondholder's Rights. No holder of any Bond issued and secured under the provisions hereof will have the right to institute any proceeding, judicial or otherwise, for the enforcement of the covenants herein contained, without the written concurrence of the holders of not less than 25 percent in aggregate principal amount of Bonds which are at such time outstanding and payable from the Revenue Bond Account, but the holders of this amount of such Bonds may, either at law or in equity, by suit, action or other proceeding, protect and enforce the rights of all holders of such Bonds and compel the performance of any and all of the covenants required herein to be performed by the City and its officers and agents, including but not limited to the establishment and maintenance of charges and fees and the collection and proper segregation of revenues and the use thereof. The holders of a majority in principal amount of such outstanding Bonds will have the right to direct the time, method and place of conducting any proceeding for any remedy available to such holders or the exercise of any power conferred upon them, and the right to waive a default in the performance of any such covenant, and its consequences, except a default in the payment of the principal of or interest on any such Bonds when due. However, nothing herein will impair the absolute and unconditional right of the holder of each such Bond to receive payment of the principal thereof and interest thereon as such principal and interest respectively become due, from the revenues and other sources pledged and appropriated for the payment thereof, and to institute suit for the enforcement of any such payment. 5.07. Bonds Not Debt. The Bonds authorized and contemplated herein will not constitute in any manner indebtedness of the City within the meaning of any provision of State law limiting the amount or method of incurring indebtedness. Ron 5.08. Budget for Operation and Maintenance. The City recognizes its obligation under Minnesota Statutes, Section 471.191, Subdiv. 2, to provide in its budget each year while any Bonds are outstanding and unpaid, for any anticipated deficiency in the revenues available for operation and maintenance of the Facilities. Section 6. Defeasance. When any Bond has been discharged as provided in this Section 6, all pledges, covenants and other rights granted by this resolution to the holders of such Bonds shall cease, and such Bonds shall no longer be deemed outstanding under this Resolution. The City may discharge its obligations with respect to any Bond which is due on any date by irrevocably depositing with the Registrar on or before that date a sum sufficient for the payment thereof in full; or, if any Bond should not be paid when due, the City may nevertheless discharge its obligations with respect thereto by depositing with the Registrar a sum sufficient for the payment thereof in full with interest accrued to the date of such deposit. The City may also at any time discharge its obligations with respect to any Bonds, subject to the provisions of law now or hereafter authorizing and regulating such action, by depositing irrevocably in escrow, with a bank qualified by law as an escrow agent for this purpose, cash or securities which are authorized by law to be so deposited, bearing interest payable at such times and at such rates and maturing on such dates as shall be required, without reinvestment, to pay all principal and interest to become due thereon to maturity or, if notice of redemption as herein required has been duly provided for, to such earlier redemption date. Section 7. CountVAuditor Registration, Certification of Proceedings, Investment of Money, Arbitrage, Official Statement and Fees. 7.01. County Auditor Registration. The City Clerk is hereby authorized and directed to file a certified copy of this Resolution with the County Auditor of Hennepin County, together with such other information as the County Auditor shall require, and to obtain from said County Auditor a certificate that the Bonds have been entered on his bond register as required by law. 7.02. Certification of Proceedings. The officers of the City and the County Auditor of Hennepin County are hereby authorized and directed to prepare and furnish to the Purchaser and to Dorsey & Whitney LLP, Bond Counsel to the City, certified copies of all proceedings and records of the City, and such other affidavits, certificates and information as may be required to show the facts relating to the legality and marketability of the Bonds as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates and affidavits, including any heretofore furnished, shall be deemed representations of the City as to the facts recited therein. 7.03. Covenant. The City covenants and agrees with the holders 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 subject to taxation under the Internal -17- Revenue Code of 1986, as amended (the "Code"), and Regulations promulgated thereunder (the Regulations), as such are enacted or promulgated and in effect on the date of issue of the Bonds, and covenants to take any and all actions within its powers to ensure that the interest on the Bonds will not become subject to taxation under such Code and Regulations. The Facilities are public improvements available for use by members of the general public on a substantially equal basis. The City will not enter into any lease, use agreement or other contract respecting the Improvements or security for the payment of the Bonds which would cause the Bonds to be considered "private activity bonds" or "private loan bonds" pursuant to Section 141 of the Code. 7.04. Arbitrage Rebate. For purposes of complying with the requirements of Section 148(f)(4)(C) of the Code relating to the exemption of certain small governmental units from the rebate requirements of the Code, the City represents that: (i) the City is a governmental unit with general taxing powers; (ii) the Bonds are not "private activity bonds" as defined in Section 141 of the Code (Private Activity Bonds); (iii) ninety-five percent of the net proceeds of the Bonds are to be used for the local governmental purposes of the City; and (iv) the aggregate face amount of all tax-exempt bonds (other than Private Activity Bonds and refunding bonds not taken into account under Section 148(f)(4)(D)(i)(IV) of the Code pursuant to Section 148(f)(4)(D)(iii) of the Code) issued by the City in calendar year in which the Bonds are to be issued is not reasonably expected to exceed $5,000,000. Therefore, pursuant to the provisions of Section 148(f)(4)(c) of the Code, the City shall not be required to comply with the arbitrage rebate requirements of paragraphs (2) and (3) of Section 148(f) of the Code. 7.05. Arbitrage Certification. The Mayor and the City Manager, 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 certification in accordance with the provisions of Section 148 of the Code, and the Regulations, stating the facts, estimates and circumstances in existence on the date of issue and delivery of the Bonds which make it reasonable to expect that the proceeds of the Bonds will not be used in a manner that would cause the Bonds to be arbitrage bonds within the meaning of the Code and Regulations. In 7.06. Oualified Tax -Exempt Obligations. In order to enhance the marketability of the Bonds, and since the City and all subordinate entities do not reasonably expect to issue in excess of $10,000,000 of governmental and qualified 501(c)(3) bonds during calendar year 2000, the Bonds are hereby designated by the City as "qualified tax-exempt obligations" pursuant to Section 265(b) of the Code. 7.07. Official Statement. The Official Statement relating to the Bonds, dated March 3, 2000, prepared and distributed on behalf of the City by Evensen Dodge Inc., is hereby approved. Evensen Dodge Inc. is hereby authorized on behalf of the City to prepare and distribute to the Purchaser a supplement to the Official Statement listing the offering price, the interest rates, selling compensation, delivery date, the underwriters and such other information relating to the Certificates required to be included in the Official Statement by Rule 15c2-12 adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934. Within seven business days from the date hereof, the City shall deliver to the Purchaser a reasonable number of copies of the Official Statement and such supplement. The officers of the City are hereby authorized and directed to execute such certificates as may be appropriate concerning the accuracy, completeness and sufficiency of the Official Statement. Section 8. Continuing Disclosure. The Securities and Exchange Commission has promulgated certain amendments to Rule 15c2-12 under the Securities Exchange Act of 1934 (17 C.F.R. § 240.15c2-12) (the "Rule") that make it unlawful for an underwriter to participate in the primary offering of municipal securities in a principal amount of $1,000,000 or more unless, before submitting a bid or entering into a purchase contract for the securities, it has reasonably determined that the issuer or an obligated person has undertaken in writing for the benefit of the holders of the securities to provide certain disclosure information to prescribed information repositories on a continuing basis or unless and to the extent the offering is exempt from the requirements of the Rule. The principal amount of the Bonds is less than $1,000,000. The City hereby represents that it has not issued within the six months before the date of issuance of the Bonds, and that it reasonably expects that it will not issue within six months after the date of issuance of the Bonds, other securities of the City of substantially the same security and providing financing for the same general purpose or purposes as the Bonds. Consequently, this Council hereby finds that the Rule is inapplicable to the Bonds, because the aggregate principal amount of the Bonds and any other securities required to be integrated with the Bonds thereunder is less than $1,000,000. Therefore, the City will not enter into any undertaking to provide continuing disclosure of any kind with respect to the Bonds. NMI Attest: City Clerk Mayor The motion for the adoption of the foregoing resolution was duly seconded by Councilmember Collier , and upon vote being taken thereon, the following voted in favor thereof: Enck, Cassen, Collier, Norby, Thompson and the following voted against the same: None whereupon said resolution was declared duly passed and adopted, and was signed by the Mayor which signature was attested by the City Clerk. -20- CERTIFICATE OF REGISTRAR The undersigned hereby certifies and declares that I am the Finance Director/Treasurer of the City of New Hope, Minnesota, and that: 1. I have been designated, by resolution of the City Council of the City of New Hope, Minnesota (the City), adopted on March 13, 2000 (the Resolution), to act as paying agent, registrar and transfer agent for $600,000 Golf Course Gross Revenue Bonds, Series 2000B (the Bonds) and has been designated to execute the certificates of authentication on the Bonds on behalf of the City as an authenticating agent. 2. On the date hereof, I have authenticated and delivered to The Depository Trust Company, on behalf of Bernardi Securities, Inc., in Chicago, Illinois (the Purchaser), $600,000 in aggregate principal amount of Bonds, maturing on February I in the years and amounts bearing interest from the date of issue until paid or duly called for redemption at the rates set forth below: Year Amount Rate Year Amount Rate 2001 $25,000 6.125% 2011 $30,000 6.25% 2002 20,000 6.125 2012 30,000 6.25 2003 20,000 6.125 2013 30,000 6.25 2004 20,000 6.20 2014 35,000 6.25 2005 20,000 6.20 2015 35,000 6.25 2006 20,000 6.20 2016 40,000 6.30 2007 25,000 6.20 2017 40,000 6.35 2008 25,000 6.20 2018 40,000 6.40 2009 25,000 6.20 2019 45,000 6.45 2010 25,000 6.20 2020 50,000 6.50 One Bond has been issued for each maturity set forth above. The Bonds so authenticated and delivered were registered, on the face thereof and also in the bond register maintained by the Registrar, in the name of Cede & Co., as nominee for The Depository Trust Company. IN WITNESS WHEREOF, I have hereunto set my hand this 11`" day of April, 2000. Finance Director/Treasurer CERTIFICATE AND RECEIPT OF FINANCE DIRECTOR/TREASURER I, Daryl Sulander, being the duly qualified and acting Finance Director/Treasurer of the City of New Hope, Hennepin County, Minnesota, hereby certify and acknowledge that on the date of this instrument I received from Bernardi Securities, Inc., of Chicago, Illinois, as purchaser thereof, the purchase price for the $600,000 Golf Course Gross Revenue Bonds, Series 2000B (the Bonds), dated as of April 1, 2000, said purchase price being computed as follows: Purchase price of Bonds $591.000.70 Accrued interest from April 1, 2000 to the date hereof 1.046.49 Total Purchase Price $592.047.19 and that I thereupon, as Bond Registrar, delivered the Bonds to the Purchaser. WITNESS my hand officially as such Finance Director this 11t' day of April, 2000. aryl Sulander Finance Director/Treasurer OFFICERS' CERTIFICATE We, W. PETER ENCK and DANIEL J. DONAHUE, hereby certify that we are the Mayor and the City Manager, respectively, of the City of New Hope, Minnesota (hereinafter, the City), and that: 1. In our capacity as such officers, we have affixed our signatures as such officers to each bond of an issue of $600,000 Golf Course Gross Revenue Bonds, Series 2000B, dated initially as of April 1, 2000 (hereinafter, the Bonds), of the City, and have delivered the Bonds to the City Finance Director (the Registrar) for authentication and delivery to The Depository Trust Company on behalf of the purchasers thereof. The Bonds are in fully registered form. 2. The Bonds mature on the dates, bear interest at the rates and are substantially in the form prescribed by a resolution duly adopted by the City Council of the City on March 13, 2000, entitled "Resolution Relating to $600,000 Golf Course Gross Revenue Bonds, Series 200013; Authorizing the Issuance, Awarding the Sale, Fixing the Form and Details, and Providing for the Execution and Delivery Thereof and Security Therefor," (hereinafter, the Resolution). The Bonds have been in all respects duly executed for delivery pursuant to authority conferred upon as such officers; that no obligations other than the Bonds have been issued pursuant to such authority; that none of the proceedings or records which have been certified to the purchaser of the Bonds or to the attorneys rendering an opinion as to the validity of the Bonds has been in any manner repealed, amended or changed, except as shown in the proofs so furnished; and that there has been no material change in the financial condition of the City or the facts affecting the Bonds except as shown on the proofs so furnished. 3. The Resolution has not been amended or repealed. 4. The Official Statement, dated March 17, 2000, relating to the Bonds, prepared by the City, did not as of the date thereof and does not as of the date hereof contain any misstatement of a material fact or omit to state any material fact necessary to make the statements contained therein not misleading in light of the circumstances under which they were made; provided that we make no comment regarding information provided by the purchaser of the Bonds for inclusion in the Official Statement relating to the purchase and the reoffering prices of the Bonds. 5. No litigation of any nature is now pending or, to the best of our knowledge, threatened, seeking to restrain or enjoin the issuance or delivery of the Bonds or the levy or collection of any special assessments or ad valorem taxes to pay the interest on or principal of the Bonds, or in any manner questioning the authority or proceedings for the issuance of the Bonds or the application of the proceeds thereof, or for the levy or collection of said special assessments or ad valorem taxes, or affecting the validity of the Bonds or questioning the corporate existence or boundaries of the City or the title of any of the present officers thereof to their respective offices. 6. On the basis of facts, estimates and circumstances in existence on the date of issue of the Bonds, the proceeds of the issue will not be used in a manner that would cause the Bonds to be "arbitrage bonds" within the meaning of applicable provisions of Section 148 of the Internal Revenue Code of 1986, as amended (hereinafter the Code) and of Sections 1.148-1 through 11 and 1.150-1 of the Income Tax Regulations, as amended to the date hereof; and that the facts and circumstances upon which this certificate is based are as follows: (a) The Bonds are being issued to finance the construction of a new clubhouse for the City's municipal golf course (hereinafter the Project). The Project is intended for use by members of the general public. (b) Based upon the most recent estimate of cost of the Project, the City expects to spend the following to construct the Project: Project Costs ......................... $588,048.70 Discount ............................ 8,999.30 Costs of Issuance ..................... 2,952.00 Total ............................. $600,000.00 (c) The City has entered into contracts for acquisition and construction of the Project in the sum of at least $30,000, which is an amount equal to 5% of the net sales proceeds of the Bonds. (d) Construction of the Project will proceed with due diligence to completion and are expected to be completed by April 1, 2000. (e) The City will receive $592,047.19 from the purchaser of the Bonds. This amount represents a payment of $591,000.70 for the principal of the Bonds plus $1,046.49 representing accrued interest on the Bonds from April 1, 2000, to the date hereof. (f) Of the amount set forth in (e), $588,048.70 will be used to pay the costs of the Project on the Bonds as set forth in (b), $2,952.00 will be used to pay costs of issuance of the Bonds (representing costs of financial advisors, legal services, advertising and printing and similar items), and $1,046.49 will be deposited in the Revenue Bond Account created by the Resolution in the Golf Course Fund of the City (the Sinking Fund) and be used to pay interest on the Bonds. (g) The amount to be received by the City from the purchaser of the Bonds, less the costs of issuance of the Bonds, does not exceed the amount to be spent by the City for the Project. -2- (h) The City expects to spend on the Project, within three years from the date hereof, all of the proceeds to be derived by the City from the sale of the Bonds. (i) The Project has not been and is not expected to be sold or otherwise disposed of by the City during the term of the Bonds. 0) The principal of and interest on the Bonds are payable from the Sinking Fund. The City expects to use only the Sinking Fund to pay principal of or interest on the Bonds. The gross revenues of the City's municipal golf course pledged to the Sinking Fund by the Resolution are expected to produce amounts sufficient to pay all principal of and interest on the Bonds when due. (k) In Section 4.02 of the Resolution the City has established in the Golf Course Fund a separate bookkeeping account to be designated as the Reserve Account (the "Reserve Account"). Upon the issuance of the Bonds the City shall deposit in the Reserve Account from funds on hand of the City and available therefor the sum of $56,394.80 which is the amount equal to the lesser of (i) the average Principal and Interest Requirements to become due in any future calendar year on the bonds payable from the Sinking Fund, (ii) the maximum Principal and Interest Requirements to become due in any future calendar year on the bonds payable from the Revenue Bond Account, or (iii) 10% of the proceeds of all series of bonds issued and made payable from the Revenue Bond Account as to which any bond of such series is then Outstanding (the "Reserve Requirement"). The funding of the Reserve Account was required in connection with the marketing of the Bonds. The Reserve Account shall be maintained at the Reserve Requirement by the retention of interest earnings therein and/or the transfer thereto of gross income and revenues derived from the operation of the municipal golf course in excess of the requirements of the Sinking Fund. Except as provided below, when and if the balance in the Reserve Account is more than the Reserve Requirement, the excess shall be transferred, not less often than annually, to the Sinking Fund. Moneys on hand in the Reserve Account shall be used only to pay interest or principal actually due on bonds payable from the Revenue Bond Account when, if and to the extent that such interest or principal cannot be paid in full from the Revenue Bond Account; provided that the amount of the Reserve Account allocable to any series of bonds may used at any time to discharge such series of bonds in accordance with the Resolution, so long as the balance remaining on hand in the Reserve Account following such use is not less than the Reserve Requirement with respect to bonds which continue to be payable from the Sinking Fund. (1) The provisions hereof are intended to establish and provide for the City's compliance with Section 1.150-2 of the Treasury Regulations (hereinafter the Reimbursement Regulations) applicable to the "reimbursement proceeds" of the Bonds, being those proceeds which will be used by the City to reimburse itself for any expenditure with respect to the Project -3- which the City paid or will have paid prior to the issuance of the Bonds (hereinafter a Reimbursement Expenditure). The City hereby certifies and/or covenants as follows: (i) On or before sixty days after the date of payment of each Reimbursement Expenditure, the City (or person designated to do so on behalf of the City) made or will have made a written declaration of the City's official intent (hereinafter a Declaration) which complies with the provisions of Section 1.150-2(e) of the Reimbursement Regulations; provided, however, that no such Declaration shall be necessary (i) with respect to certain unforeseeable expenditures, if any, with respect to the Project meeting the requirements of Section 150-2(f)(1) of the Reimbursement Regulations, (ii) with respect to "preliminary expenditures" for the Project as defined in Section 1.150-2(f)(2) of the Reimbursement Regulations, including engineering or architectural expenses and similar preparatory expenses, which in the aggregate do not exceed 20% of the "issue price" of the Bonds; or (iii) costs of issuance of the Bonds or an amount not in excess of $30,000, which is the lesser of (a) $100,000 or (b) 5% of the proceeds of the Bonds. (ii) As of the date of each Declaration, no funds from sources other than the Bonds were, or were reasonably expected to be, reserved, allocated on a long-term basis, or otherwise set aside by the City to provide financing for the Reimbursement Expenditure. (iii) Each Declaration was made a part of the publicly available official books, records or proceedings of the City and was continuously available for inspection by the general public at the main administrative office of the City during regular business hours beginning not later than 30 days after the making of the Declaration and continuing through the date of issuance of the Bonds, as required by the Reimbursement Regulations. (iv) Each Reimbursement Expenditure, other than the costs of issuing the Bonds, is a capital expenditure (i.e., a cost that is properly chargeable to capital account (or would be with a proper election) under general federal income tax principles). (v) The "reimbursement allocation" described in the Reimbursement Regulations for each Reimbursement Expenditure shall be made forthwith following (but not prior to) the issuance of the Bonds and in all events within the period ending on H the date which is the later of one year after payment of the Reimbursement Expenditure or one year after the date on which the Project to which the Reimbursement Expenditure relates is first placed in service. (vi) Each such reimbursement allocation will be evidenced by an entry on the official books or records of the City maintained for and in connection with the Bonds and will specifically identify the actual prior Reimbursement Expenditure or, in the case of the reimbursement of a particular fund or account described in the applicable Declaration, the fund or account from which the Reimbursement Expenditure was paid. (vii) The City is unaware of any facts or circumstances which would cause it to question the reasonableness or accuracy of this paragraph or of any of the Declarations, or its compliance with any of the covenants herein or therein contained. (m) No proceeds of the Bonds will be used, directly or indirectly, to replace funds of the City which are or were available and earmarked to be used for the purposes for which the Bonds are being issued. The average maturity of the Bonds does not exceed 120% of average reasonably expected economic life of the Project. (n) There are no governmental obligations (i) issued at substantially the same time as the Bonds, (ii) sold pursuant to a common plan of financing with the Bonds and (iii) that will be paid out of substantially the same source of funds (or that will have substantially the same claim to be paid out of substantially the same source of funds) as will be used to pay the Bonds. (o) The City reasonably expects that at least 85% of the spendable proceeds of the Bonds will be used to finance the acquisition and construction of the Project within three years of the date hereof and no more than 50% of said proceeds will be invested in nonpurpose investments having a substantially guaranteed yield for four years or more. (p) In Section 7.03 of the Resolution the City has covenanted and agreed with the holders 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 that would cause the interest on the Bonds to become subject to taxation under the Code and the Treasury Regulations promulgated thereunder. (q) For purposes of complying with the requirements of Section 148(f)(4)(D) of the Code as modified by Section 148(f)(4)(D)(v) thereof relating to the exemption of certain small governmental units from the rebate requirements of the Code, the City represents that: -5- (i) the City is a governmental unit with general taxing powers; (ii) The Bonds are not "private activity bonds" as defined in Section 141 of the Code (Private Activity Bonds); (iii) Ninety-five percent of the net proceeds of the Bonds are to be used for the local governmental purposes of the Issuer; and (iv) the aggregate face amount of all tax-exempt obligations (other than Private Activity Bonds and refunding bonds not taken into account under Section 148(f)(4)(D)(i)(IV) of the Code pursuant to Section 148(f)(4)(D)(iii) of the Code) issued by the City in calendar year 2000 is not reasonably expected to exceed $5,000,000. (r) To the best of the knowledge and belief of the undersigned, the expectations of the City, as set forth above, are reasonable, and there are no present facts, estimates or circumstances which would change the foregoing expectations. (s) The Commissioner of the Internal Revenue Service has not published notice in the Internal Revenue Bulletin that the City is disqualified with respect to arbitrage certifications. The City has not been notified by the Commissioner of any intent to publish such notice. (t) We are the officers of the City responsible for the issuance of the Bonds. 7. We are now, and were on April 1, 2000, the duly qualified and acting Mayor and City Manager and duly authorized to execute the Bonds. M WITNESS our hands and the seal of the City, this 1 I" day of April, 2000. CITY OF NEW HOPE, MINNESOTA Mayor f Cy Manager -7- APR 10 100 08:51PM EERNAP.DI SECURITIES P.4i5 CERTIFICATE OF PURCHASER The undersigned officer of Bernardi Securities, Inc., Chicago, Illinois, which has purchased the $400,000 Golf Course Cross Revenue Bonds, Series 2000B (the Bonds) of the City of New Hope, Minnesota, originally dated as of April 1, 2000, hereby certifies that the Bonds of each maturity were initially reoffered to the public at the prices shown in Exhibit A hereto, plus accrued interest. I further certify that, as of the date hereof, at least 10% of the principal amount of the Bonds of each maturity has been sold at said price or lower prices. Dated: April 11, 2000. BERNARDI SECURITIES, INC, LM APR 18 '00 98:51PM BERNARDI SECURITIES EXHIBIT A P.5/5 Reoffering Reoffering Year Amount Rate Pricc Yield Year Amount Rate Price Yield 2001 $25,000 6.125% $25,217.00 5.00% 2011 $30,000 6.25% $30,578.10 5.90% 2002 20,000 6.125 20,347.40 5.10 2012 30.000 6.25 30,410.70 6.00 2003 20,000 6.125 20,475.20 5.2D 2013 30,000 6.25 30,327.30 6.05 2004 20,000 6.20 20,611-00 5.30 2014 35,000 6.25 35,284.90 6.10 2005 20,000 6.20 20,667.20 5.40 2015 35,000 6.25 35,000.00 6.25 2006 20,000 6.20 20,685.80 5-50 2016 40,000 6.30 40,000.00 6.30 2007 25,000 6.20 25.836.50 5.60 2017 40,000 6.35 40,000.00 635 2008 25,000 6.20 25,694.25 5.70 2018 40,000 6.40 40,000.00 6A0 2009 25,000 6.20 25,553.00 5.80 2019 45,000 6.45 45,000.00 6.45 2010 25,000 6.20 25,482.75 5.85 2020 50,000 6.50 50,000.00 6.50 $600,000 Golf Course Gross Revenue Bonds, Series 2000B City of New Hope, Minnesota CERTIFICATE OF EVENSEN DODGE INC. The undersigned officer of Evensen Dodge Inc. hereby certifies that: 1. Evensen Dodge Inc., is acting as financial consultants in connection with the issuance by the City of New Hope, Minnesota (the "City"), of its $600,000 Golf Course Gross Revenue Bonds, Series 2000B, dated, as originally issued, as of April 1, 2000 (the "Bonds"). The information contained in this Certificate is correct, to the best of our knowledge, in reliance upon certain information provided to us by the City and the original purchaser of the Bonds. 2. The bid accepted by the City for the purchase of the Bonds is a reasonable bid under customary standards applicable in the municipal bond market. 3. The yield on the Bonds to maturity, based on the information supplied by the Purchaser in the Certificate of Purchaser is 6.1624%. The yield on the Bonds has been calculated, as provided in Section 1.148-4(6) of the Treasury Regulations as that discount rate that, when used in computing the present value of all unconditional payments of principal, interest and fees for qualified guaranties on the Bonds and amounts reasonably expected to be paid as fees for qualified guaranties on the Bonds, produces an amount equal to the present value, using the same discount rate, of the aggregate issue price of the Bonds as of the issue date. The "issue price" of the Bonds is $607,171.10, which is the initial offering price of the Bonds to the public, as shown by the Certificate of Purchaser. 4. The City's mailing address, including zip code, is: City of New Hope 4401 Xylon Avenue North New Hope, Minnesota 55428 5. The City's federal employer identification number is 41-6008870. 6. The City has directed that the report number for Internal Revenue Service Form 8038 relating to the Bonds, which is to be numbered consecutively in order of filing date based on the Forms 8038 filed by the City in 2000 (not the date of issue), be identified as 2000-2. 7. The weighted average maturity of the Bonds, based on the issue price of each stated maturity of the Bonds from their date of issue (not on the basis of the principal amount of the Bonds or from their dated date), is 11.858ycars. 8. The net interest cost of the Bonds, determined by dividing the total interest payments for the Bonds (reduced by any premium or accrued interest and increased by any discount) by the product of the issue price of the Bonds and the weighted average maturity of the Bonds) is 6.1823596%. 9. The terms used herein have the meanings given them in Section 148 of the Code, applicable Treasury Regulations or in the Instructions for Form 8038-G (Rev. May 1999). Dated: April 11, 2000. EVENSEN DODGE INC. -I)- Its Senior Vice President DORSEY & WHITNEY LLP MINNEAPOLIS PILLSBURY CENTER SOUTH NEW YORK 220 SOUTH SIXTH STREET SEATTLE MINNEAPOLIS, MINNESOTA 55402-1498 DENVER TELEPHONE: (612) 340-2600 WASHINGTON, D.C. FAX: (612) 340-2868 DES MOINES ANCHORAGE JEROME P. GILLIGAN LONDON (612) 340-2962 FAX (612) 340-2644 COSTA MESA giWgan.jerome@dorseylaw.com June 20, 2000 Director Internal Revenue Service Center Ogden, UT 84201 Re: $600,000 Golf Course Gross Revenue Bonds, Series 2000B City of New Hope, Minnesota Dear Sir or Madam: BILLINGS GREAT FALLS MISSOULA BRUSSELS FARGO HONG KONG ROCHESTER SALT LAKE CITY VANCOUVER Enclosed please find two copies of Form 8038-G for the above Bonds filed by the City of New Hope, Minnesota pursuant to Section 149(e) of the Internal Revenue Code of 1986, as amended, referred to above. Please file one (1) copy of the enclosed Form 8038-G and acknowledge receipt on the second copy, and return them to the undersigned. Thank you for your cooperation. JPG:cmn Enclosures CERTIFIED MAIL Yours truly, Fom, 8038-G I Information Return for Tax -Exempt Governmental Obligations May 1999) ► Under Internal Revenue Code section 149(e) (Rev. (Rev. May of the Treasury ► See separate Instructions. DepoInternal Revenue Service Caution: Use Form 8038 -GC if the issue pace is under $100,000. OMB No. 1545-0720 ► 1 Issuer's name 2 Issuer's employer Identification number CITY OF NEW HOPE 41-6008870 3 Number and street (or P.O. box it mail is not delivered to street address) RooMsuite 4 Report number 4401 XYLON AVENUE NORTH G 2000-2 5 City, town, or post office, state, and ZIP code 6 Date of issue NEW HOPE MN 55428 APRIL 11, 2000 7 Name of issue 8 CUSIP number GOLF COURSE GROSS REVENUE BONDS, SERIES 2000B 645450 B L 0 9 Name and title of officer or legal representative whom the IRS may call for more information 10 Telephone number of officer or legal representativeDARYL SULANDER, FINANCE DIRECTOR/TREASURER 612-531-5100 Part II 1 Type of Issue (check applicable box(es) and enter the issue price) See instructions and attach schedule 11 ❑ Education.................................................................. 11 12 ❑ Health and hospital........................................................... 12 13 ❑ Transportation.............................................................. 13 14 ❑ Public safety................................................................ 14 15 ❑ Environment (including sewage bonds) ............................................ 15 16 ❑ Housing...................................................................16 17 ❑ Utilities.................................................................... 17 18 ® Other. Describe► CLUBHOUSE FOR MUNICIPAL GOLF COURSE 18 607 171.10 19 If obligations are TANS or RANs, check box ► ❑ If obligations are BANS, check box ...... ► ❑ 20 If obligations are in the form of a lease or installment sale, check box ................. ► j-] Part III I Description of Obligations. (Complete for the entire issue for which this form is being filed.) (a) Final maturity date (b) Issue price (c) Stated redemption I== d) Weighted (.)Yield price at maturity average maturity 21 2/1/2020 1 $ 607, 171.10 $ 600,000 1 11.942 years 6.1624 % Part IV Uses of Proceeds of Bond Issue (including underwriters' discount) 22 Proceeds used for accrued interest .................................................. 22 1,046.49 23 Issue price of entire issue (enter amount from line 21, column (b)) .......................... 23 607 171.10 24 Proceeds used for bond issuance costs (including underwriters' discount) 24 19,122.40 25 Proceeds used for credit enhancement ........................... 25 0 26 Proceeds allocated to reasonably required reserve or replacement fund .. 26 0 27 Proceeds used to currently refund prior issues ..................... 27 0 28 Proceeds used to advance refund prior issues ..................... 28 0 29 Total (add lines 24 through 28) ..................................................... 29 19 122 .40 30 Nonrefundin proceeds of the issue (subtract line 29 from line 23 and enter amount here) ........ 30 586, 048. 70 Part V Description of Refunded Bonds (Complete this part only for refunding bonds.) 31 Enter the remaining weighted average maturity of the bonds to be currently refunded ........... ► years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded ........... ► years 33 Enter the last date on which the refunded bonds will be called ............................ ► 34 Enter the date(s) the refunded bonds were issued ► Part VI Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141(b)(5) ......... 35 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (see instructions) .... 36a b Enter the final maturity date of the guaranteed investment contract ► 37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units ........... 37a b If this issue is a loan made from the proceeds of another tax-exempt issue, check box ► Q and enter the name of the issuer ► and the date of the issue ► 38 If the issuer has designated the issue under section 265(b)(3)(B)(i)(Ill) (small issuer exception), check box ............ ► 39 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box ... . .............................. ► ❑ 40 If the issuer has identified a hedge, check box .......................................................... ► ❑ Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, Please they are true,rract,andc plate. DARYL SULANDER Sign ' 4/11/00 ' FINANCE DIRECTOR/TREASURER Here Signature of issuer' uthorized representative Date Type or print name and title For Paperwork Reduction Act Notice, see page 2 of the Instructions. ISA Form 8038-G (Rev. 5-99) ST FED6403F h E s ru fL M Postage $ .O u1 f1J certified Fee Ir Retum Receipt Fee Postmark 0 (Endorsement Required) Rale 0 Restricted Delivery Fee (n Q I O " 0 (Endorsement RequireIds 0 Total Postage 8 Fees $ N r1J Name ercm.ny) (To be completed by mai—le—r) M Er streeq d!��eFi+ze-Service Center -- C3 ......--Ogden, Utah_84201------ ----------------------------------------- Cby, state, ZIP+4 :aa - •Complete items 1 andfor 2 for additional cervices. •Complete items 3, 4a, and 4b. e Prim your name and address on the reverse of this form so that we can return this card to you. •Attach this form to the front of the mailpiece, or on the back if space does not permit. eWdte'Refum Receipt Requested' on the mailpieoe below the article number. -The Return Receipt will show to whom the article was delivered and the date delivered. o Awk.d,. AAA...e....A b.. ._ .... _,_. Director Internal Revenue Service Center Ogden, Utah 84201 X PS Form , December 1994 I also wish to receive the following services (for an extra f e): 4i 1. ddressee's Address 2 2. 0 Restricted Delivery N Consult postmaster for fee. n Anhnr Registered Express Mail Return Receipt and fee is paid) J �ELCertifiecl ❑ Insured ❑ COD rn Interest Rate REGISTERED OWNER: PRINCIPAL AMOUNT: UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF NEW HOPE GOLF COURSE GROSS REVENUE BOND, SERIES 2000B Maturity February 1, _ CEDE & CO. Date of Original Issue April 1, 2000 a; N* $ CUSIP 645450 DOLLARS THE CITY OF NEW HOPE, Hennepin County, Minnesota (the "City"), acknowledges itself to be indebted and, for value received, hereby promises to pay solely from revenues appropriated and pledged to the Revenue Bond Account of its Golf Course Fund, as a lien and charge upon the gross revenues derived from time to time from the operation by the City of its municipal golf course (the "Facilities"), to the registered owner named above, or registered assigns, the principal amount specified above, on the maturity date specified above, with interest thereon from the date of original issue specified above, or from the most recent interest payment date to which interest has been paid or duly provided for, at the annual rate specified above. Interest hereon is payable on February 1 and August 1 in each year, commencing August 1, 2000, to the person in whose name this Bond is registered at the close of business on the 15th day (whether or not a business day) of the immediately preceding month, all subject to the provisions referred to herein with respect to the redemption of the principal of this Bond before maturity. The interest hereon and, upon presentation and surrendenhereof at the office of the City Finance Director, in New Hope, Minnesota, as Registrar, Transfer Agent and Paying Agent (the "Bond Registrar"), or its successor designated under the Resolution described herein, the principal hereof, are payable in lawful money of the United States of America by check or draft of the City or the Bond Registrar if a successor to the City Finance Director as Bond Registrar has been designated under the Resolution described herein. This Bond is one of an issue in the aggregate principal amount of $600,000 (the `Bonds") all of like date and tenor except as to serial number, interest rate, redemption privilege and maturity date, issued pursuant to a resolution adopted by the City Council on March 13, 2000 (the "Resolution'), for the purpose of financing the costs of improvements to the Facilities and is issued pursuant to and in full conformity with the provisions of the Constitution and laws of the State of Minnesota thereunto enabling, including Minnesota Statutes, Section 471.191 and Chapter 475. Said Bonds and the interest thereon are payable solely and exclusively from the gross revenues derived from the operation of the Facilities which have been pledged to the payment thereof and do not constitute a debt of the City within the meaning of any constitutional or statutory limitation of indebtedness, and the full faith and credit and taxing power of the City are not pledged to the payment of the principal of or interest on the Bonds. Additional revenue obligations may be issued on a parity of lien upon the gross revenues of the Facilities with the Bonds of this issue as provided in the Resolution. The Bonds are issuable only as fully registered bonds in denominations of $5,000 or any multiple thereof, of single maturities. Bonds maturing in the years 2001 through 2007 are payable on their respective stated maturity dates without option of prior payment, but Bonds having stated maturity dates in the years 2008 through 2020 are each subject to redemption and prepayment, at the option of the City and in whole or in part, and if in part, in the maturities selected by the City and, within any maturity, in $5,000 principal amounts selected by lot, on February 1, 2007 and on any date thereafter, at a price equal to the principal amount thereof to be redeemed plus accrued interest to the date of redemption. At least thirty days prior to the date set for redemption of any Bond, notice of the call for redemption will be mailed to the Bond Registrar and to the registered owner of each Bond to be redeemed at his address appearing in the Bond Register, but no defect in or failure to give such mailed notice of redemption shall affect the validity of the proceedings for the redemption of any Bond not affected by such defect or failure. Official notice of redemption having been given as aforesaid, the Bonds or portions of the Bonds so to be redeemed shall, on the redemption date, become due and payable at the redemption price herein specified and from and after such date (unless the City shall default in the payment of the redemption price) such Bond or portions of Bonds shall cease to bear interest. Upon the 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(b) of the Internal Revenue Code of 1986, as amended. As provided in the Resolution and subject to certain limitations set forth therein, this Bond is transferable upon the books of the City at the principal office of the Bond 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 Bond 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 the transferee or registered owner, of the same aggregate principal amount, -2- 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 Bond 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 Bond Registrar shall be affected by any notice to the contrary. IT IS HEREBY CERTIFIED, RECITED, COVENANTED AND AGREED that all acts, conditions and things required by the Constitution and laws of the State of Minnesota to be done, to exist, to happen and to be performed precedent to and in the issuance of this Bond in order to make this Bond a valid and binding special obligation of the City according to its terms, have been done, do exist, have happened and have been performed in regular and due form as so required; the City has covenanted and agreed with the holder hereof that until this bond is fully paid or discharged as provided in the Resolution there will be maintained on the official,books and records of the City a separate and special Golf Course Fund, into which will be paid as received all gross revenues derived from the operation of the Facilities, and there will be maintained therein a separate and special Revenue Bond Account to which shall be irrevocably pledged and appropriated and credited on a periodic basis, as a lien and charge on all such gross revenues, a sum sufficient to ensure a balance therein at all times adequate to pay all principal and interest as such becomes due and payable on all bonds payable from the Golf Course Fund during any subsequent twelve month period; that reasonable rates and charges for all services and commodities furnished and made available by and through the Facilities will be established, maintained and revised when necessary and will be imposed and collected for the use of such Facilities in accordance with schedules such that the revenues derived therefrom in each year will be sufficient to enable the City to make the required deposit in the Revenue Bond Account, and that the revenues received in excess of such requirements, together with any other funds legally available which the City shall determine to include and provide for in its budget, will be sufficient to pay promptly as incurred all current, reasonable and necessary costs of the operation and maintenance of the Facilities, and to provide for necessary replacements and improvements thereof, that if necessary for payment of costs of operating and maintaining the Facilities the City will levy an ad valorem tax on all taxable property within the City, subject to the limitations imposed upon general purpose City tax levies; that the Resolution contains other covenants for the security of this Bond which will be promptly and fully performed as stipulated therein; and that the issuance of this Bond does not cause the indebtedness of the City to exceed any constitutional or statutory limitation. 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 hereon shall have been executed by the Bond Registrar by the manual signature of the Bond Registrar, or in the event the City Finance Director is no longer acting as Bond Registrar, one of the authorized representatives of the Bond Registrar. -3- IN WITNESS WHEREOF, the City of New Hope, Hennepin County, Minnesota, by its City Council, has caused this Bond to be executed by the facsimile signatures of the Mayor and the City Manager and has caused this Bond to be dated as of the date set forth below. Date of Authentication: April 11, 2000. City Manager CITY OF NEW HOPE CERTIFICATE OF AUTHENTICATION ` This is one of the Bonds delivered pursuant to the Resolution mentioned within. By City Finance Director, as Bond Registrar 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 UNIF TRANS MIN ACT....... Custodian....... . in common , (Cust) (Minor) TEN ENT — — as tenants by the entireties JT TEN — — as joint tenants with right of survivorship and not as tenants in common under Uniform Transfers to Minors Act...................... (State) Additional abbreviations may also be used. lie 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(s) must be guaranteed by an "eligible guarantor institution" meeting the requirements of the Bond Registrar, which requirements include membership or participation in the Securities Transfer Association Medalion Program (STAMP) or such other "signature guaranty program" as may be determined by the Bond Registrar in addition to or in substitution for STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. NOTICE: The signature(s) 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. -5- COUNTY AUDITOR'S CERTIFICATE AS TO REGISTRATION OF BONDS CITY OF NEW HOPE, MINNESOTA I, the undersigned, being the duly qualified and acting County Auditor of Hennepin County, Minnesota, hereby certify that there has been filed in my office a certified copy of Resolution No. 00-58 of the City Council of the City of New Hope, in said County, adopted March 13, 2000, awarding the sale, fixing the form and details and providing for the execution, delivery and security of $600,000 Golf Course Gross Revenue Bonds, Series 2000B, of the City, to be dated, as of April 1, 2000. I further certify that said Bonds have been entered on my bond register as required by Minnesota Statutes, Sections 475.62. WITNESS my hand and official seal this - day of April, 2000. (r s„ gTy ennepin ou uditor (SEAL)