HomeMy WebLinkAboutContract 20032003
EXECUTION COPY
PAYING AGENT AGREEMENT
between
Columbia Heights Economic Development Authority,
as Issuer,
and
Bond Trust Services Corporation
as Paying Agent
Dated as of August 1, 2007
Relating to:
$2,890,000
Tax Increment Revenue Bonds
(Iluset Park Area Redevelopment Project)
Series 2007
This document drafted by:
Kennedy & Graven, Chartered (SJB}
470 U.S. Bank Plaza.
200 South Sixth Street
Minneapolis, Minnesota 55402-1458
TABLE OF CONTENTS
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Recitals by the Issuer ................................................................................................................................... I
ARTICLE ONE
Definitions and General Provisions
Section 1-l. Definitions ...................................................................................................................2
Section 1-2. Governing Law ........................................................................................................... 5
ARTICLE TWO
The Bonds
Section 2-1. Pledge Effected by the Paying Agent Agreement; Special Obligations ..................... 6
Section 2-2. Forms Generally ..........................:............................................................................... 6
Section 2-3. Principal Amount, Designation, Interest Rates and Maturities ................................... 6
Section 2-4. Payment of Interest and Principal ............................................................................... 7
Section 2-5. Registered From and Denominations .......................................................................... 7
Section 2-6. Execution of Bonds ..................................................................................................... 7
Section 2-7. Authentication of Bonds ............................................................................................. 7
Section 2-8. Registration and Transfer of Bonds and Agent Therefor ............................................ 8
Section 2-9. Transfer and Exchange of Bonds ................................................................................ 8
Section 2-10. Bonds Mutilated, Destroyed, Stolen or Lost ............................................................... 8
Section 2-11. Nonpresentment of Bonds ........................................................................................... 9
Section 2-12. Temporary Bonds ........................................................................................................ 9
Section 2-13. Description of the Book-Entry System ....................................................................... 9
ARTICLE THREE
Redemption of Bonds Before Maturity
Section 3-1. Redemption ...............................................................................................................12
Section 3-2. Election to Redeem, Notice to Paying Agent ............................................................ I3
Section 3-3. Selection of Bonds to be Redeemed ..........................................................................13
Section 3-4. Notice of Redemption ...............................................................................................13
Section 3-5. Bonds Payable on Redemption Date .........................................................................14
ARTICLE FOUR
Covenants of the Issuer
Section 4-1. Payment of Principal and Interest .............................................................................15
Section 4-2. Revenue Covenants ...................................................................................................15
Section 4-3. Additional Obligations ..............................................................................................16
Section 4-4 Obligations of Issuer as to Tax-Exempt Status of the Bonds ....................................16
ARTICLE FIVE
Funds, Application of Available Tax Increment and Other Matters
Section 5-1. Establishment of Funds ............................................................................................. 18
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Section 5-3. Bond Fund ................................................................................................................. 18
Section 5-4. Project Fund .............................................................................................................. 18
Section 5-5. Capitalized Interest Fund .......................................................................................... 19
Section 5-6. Costs of Issuance Fund ............................................................................................. 19
Section 5-7. Reserve Fund ............................................................................................................ 19
Section 5-8. Prepayment Fund ...................................................................................................... 20
Section 5-9. Rebate Fund .............................................................................................................. 20
Section 5-10. Investments ............................................................................................................... 21
ARTICLE SIX
Discharge of Lien
Section 6-1. Defeasance ................................................................................................................22
ARTICLE SEVEN
The Paying Agent
Section 7-I. Duties of Paying Agent .............................................................................................23
Section 7-2. Fees, Charges, and Expenses of the Paying Agent ...................................................23
Section 7-3. Resignation of the Paying Agent .............................................................................. 23
Section 7-4. Covenants of Issuer ...................................................................................................23
ARTICLE EIGHT
Miscellaneous
Section 8-1. Severability ...............................................................................................................25
Section 8-2. Notices ......................................................................................................................25
Section 8-3. Counterparts ..............................................................................................................25
Section 8-4. Limitation of Liability of Issuer and its Officers, Employees and Agents ................25
Section 8-5. Amounts Remaining in Funds ...................................................................................25
SIGNATURES ................................................................................................................................. S-1
EXHIBIT A -Farm of Bond ........:......:.:..............................................................................................A-1
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PAYING AGENT AGREEMENT
This Paying Agent Agreement, dated as of August 1, 2007 (this "Agreement"}, between the
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under its the laws of the State of Minnesota (the "Issuer"), and Band Trust Services Corporation, a
Minnesota limited purpose trust company, duly established, existing and authorized to accept and execute
trusts of the character herein set out, with its principal office in the City of Roseville, Minnesota (the
"Paying Agent"):
RECITALS
The Issuer and the City of Columbia Heights (the "City") previously established the Huset Park
Area Tax Increment Financing District (the "TIF District") pursuant to authority granted by Minnesota
Statutes, Sections 469.174-469.1799, as amended (the "Tax Increment Act"), within the Downtown CBD
Redevelopment Project (the "Redevelopment Project"), and adopted a tax increment financing plan for
the purpose of financing certain improvements within the TIF District. In order to provide for the
redevelopment of the Redevelopment Project and the TIF District, the Issuer, City and Huset Park
Development Corporation ("Redeveloper") entered into a Contract for Private Redevelopment, dated as
of October 25, 2004, as amended by an Amended and Restated Contract for Private Redevelopment dated
August 1, 2007 (the "Contract").
Pursuant to Section 469.178 of the Tax Increment Act, the Issuer is authorized to issue and sell its
bonds or notes for the purpose of financing or refinancing public redevelopment costs in a project (which
includes the Redevelopment Project established and administered under Minnesota Statues, Sections
469.001 to 469.047) and to pledge tax increment revenues derived from a tax increment financing district
established within the Redevelopment Project to the payment of the principal of and interest on such
obligations.
Pursuant to the terms of Resolution No. 2007-13, adopted by the Board of the Issuer on
July 24, 2007, and the terms and conditions of this Agreement, the Issuer will issue its Tax Increment
Revenue Bonds (Huset Park Area Redevelopment Project), Series 2007 (the "Bonds") and will apply the
proceeds derived from the sale of the Bonds to the payments of certain Public Redevelopment Costs as
defined in the Contract.
The execution and delivery of this Agreement and the issuance of ±he Bonds b,~ the Issuer have
been in all respects duly and validly authorized by the Issuer.
ARTICLE ONE
DEFINITIONS AND GENERAL PROVISIONS
Section I-1. Definitions. In this Agreement the following terms have the following respective
meanings unless the context hereof clearly requires otherwise. Capitalized terms used herein which are
not defined in this Section 1-1 have the meanings given them in the Contract.
"Additional Obligations" has the meaning provided in Section 4-3 hereof.
"Authorized Denominations" means $25,000, and integral multiples of $1,000 in excess of
$25,000.
"Available Tax Increment" means the Tax Increment derived from the Redevelopment Property
during the six-month period preceding each Payment Date after deducting $16,500 ($11,000 for the two six-
month periods ending February 15, 2008} and the fees of the Paying Agent described in Section 7-2 hereof.
"Board" means the Board of Commissioners of the Issuer.
"Bond Closing" means the date of issuance of and payment for the Bonds.
"Bond Counsel" means any attorney or firm of attorneys designated by the Issuer and nationally-
recognized in the field of municipal finance and acceptable to the Paying Agent.
"Bond Fund" means the Fund by that name created and established by Article Five of this
Agreement.
"Bondholder" or "Holder" means a person in whose name a Bond is registered in the Bond
Register.
"Bond Purchase Agreement" means the Bond Purchase Agreement, dated July 26, 2007, between
the Issuer and the Purchaser providing for the purchase of the Bonds, and any amendments or
supplements thereto.
"Bond K.egister" means the register maintained as provided in Section 2-8 of this Agreement.
"Bond Registrar" means the Paying Agent, who shall act as bond registrar, transfer agent and
paying agent, or any successor Paying Agent or other fiduciary acting as bond registrar, iransfer agent or
paying agent for the Bonds.
"Bonds" means the Tax Increment Revenue Bonds (Huset Park Area Redevelopment Project},
Series 2007, issued by the Issuer pursuant to this Agreement.
"Bond Year" means initially the period from the date of Bond Closing to and including
February I5, 2008, and thereafter each twelve month period beginning on each February 16 and ending
on February I S of the following year.
"Business Day" means any day other than a Saturday, Sunday, legal haliday or a day on which
banking institutions in the city where the principal corporate trust office of the Paying Agent is located
are authorized by law or executive order to close.
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"City" means the City of Columbia Heights, Minnesota.
"Code" means the Internal Revenue Code of 1986, as amended.
"Contract" means the Contract for Private Redevelopment, dated as of October 25, 2004, between
the Issuer and the Redeveloper, as amended by the Amended and Restated Contract for Private
Redevelopment, dated as of August 1, 2007, and the same may be amended from time to time.
"County" means Anoka County, Minnesota.
"DTC" means The Depository Trust Company, New York, New York, and its successors and
assigns.
Bonds.
"Depository" means a trust company or other fiduciary acting as a depository with respect to the
"Excess Available Tax Increment" means, as of each Payment Date, the Available Tax Increment
deposited in the Bond Fund that is in excess of the amount needed to pay debt service due on the Bonds
on such Payment Date, after taking into account any amounts then on deposit in the Bond Fund.
"Fund" means any of the funds created and described in Article Five.
"HRA Act" means Minnesota Statutes, Sections 469.001 to 469.047, as amended.
"Paying Agent Agreement" means this Agreement, together with any supplement or amendment
hereto entered into pursuant to the applicable provisions hereof.
"Issuer" means the Columbia Heights Economic Development Authority, a public body corporate
and politic under the laws of Minnesota.
"Issuer Order" means a written order or certificate of the Issuer executed by its Executive
Director or the designee of the Executive Director.
"Maturity" means, when used with respect to any Bond, the date on which the principal of such
Bond becomes due and payable as therein or herein provided, whether at the stated Maturity or by
scheduled redemption or declaration of acceleration or call for redemption or otherwise.
"Outstanding" means, when used with reference to Bonds, as of the date of determination, all
Bonds theretofore authenticated and delivered under this Agreement except:
(a) Bonds theretofore cancelled by the Paying Agent or delivered to the Paying
Agent for cancellation;
(b) Bonds and portions of Bonds for whose payment or redemption money or
securities (as provided in Article Six) shall have been theretofore irrevocably deposited with the
Paying Agent or any other paying agent for such Bonds in trust for the Holders of such Bonds,
provided, however, that if such Bonds are to be redeemed, notice of such redemption shall have
been duly given pursuant to this Agreement or irrevocable instructians to call such Bonds far
redemption at a stated Redemption Date shall have been given to the Paying Agent; and
(c) Bonds in exchange for or in lieu of which other Bonds shall have been
authenticated and delivered pursuant to this Agreement;
provided, however, that in determining whether the Holders of the requisite principal amount of
Outstanding Bonds have given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Bonds owned by the Issuer or purchased by the Paying Agent as provided herein shall be
disregarded and deemed not to be Outstanding, except that in determining whether the Paying Agent shall
be protected in relying upon any such request, demand, authorization, direction, notice, consent, or
waiver, only Bonds which the Paying Agent actually knows to be so owned shall be disregarded.
"Participants" means those broker-dealers, banks and other financial institutions from time to
time for which DTC holds Bonds as securities depository.
"Paying Agent" means Bond Trust Ser-vices Corporation, a limited purpose trust company, and
any successor appointed, qualified and acting as such under the provisions of this Agreement.
"Payment Date" means each February 15 and August 15, commencing on August 15, 2007.
"Permitted Investments" means any investment permitted pursuant to Minnesota Statutes,
Chapter 118A.
"Prepayment Fund" means the Fund by that name created and established by Article Five of this
Agreement.
"Project" means the redevelopment of the Redevelopment Property and construction of the
Minimum Improvements, all as defined in and in accordance with the Contract.
"Purchaser" means Piper Jaffray & Co.
"Record Date" means with respect to any Payment Date on the Bonds, (a) the fifteenth day of the
month (whether or not a Business Day) next preceding such Payment Date (each, a "Regular Record
Date") or (b) if there is a default in payment of interest due on such Payment Date, a "Special Record
Date" for the payment of such defaulted interest established by the Paying Agent in accordance with
Section 2-4.
"Redemption Date" means, with respect to any Bond to be redeemed, the date on which it is to be
redeemed pursuant to this Agreement.
"Redemption Price" means, with respect to any Bond to be redeemed, the price (principal amount
plus accrued interest plus premium, if any) at which it is to be redeemed pursuant to this Agreement.
"Redeveloper" means Huset Park Development Corporation, a Minnesota corporation, and its
assignees.
Issuer.
"Redevelopment Project" means the Downtown CDB Redevelopment Project administered by the
"Redevelopment Property" means the property described in Exhibit A of the Contract.
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"Representation Letter" means any letter of representations or agreement from the Issuer or the
Paying Agent to DTC with respect to the Bonds, and any similar letter or other agreement with any
successor depository for the Bonds.
"Reserve Requirement" means the amount from time to time required to be held or accumulated
in the Reserve Fund, that amount being equal to the least of: (i) ten percent (10%) of the original
principal amount of the Bonds; (ii) 125 percent of the average annual debt service on the Bonds; or
(iii} 50 percent of the maximum annual debt service on the Bonds (excluding the Bond Year ending
February 15, 2032).
"Subordinate Note" means the Limited Revenue Tax Increment Note issued by the Issuer to the
Redeveloper in the original aggregate principal amount of $6,650,000 pursuant to the Contract.
"State" means the State of Minnesota.
"Tax Increment" means that portion of the real property taxes which is paid with respect to the
Redevelopment Property and which is remitted to the Authority as tax increment pursuant to the Tax
Increment Act. The term Tax Increment does not include any amounts retained by or payable to the State
auditor under Section 469.177, subd. 11 of the Tax Increment Act, or any amounts described in Section
469.174, subd. 25, clauses (2) through (4} of the Tax Increment Act.
"Tax Increment Act" means Minnesota Statutes, Sections 469.174 through 469.1799, as
amended.
"TIF District" means the Huset Park Area Tax Increment Financing District established by the
Issuer and the City.
"Treasury Regulations" means the income tax regulations promulgated by the United States
Department of the Treasury under the Code and applicable to the Bonds.
Section 1-2. Governing Law. This Agreement shalt be construed in accordance with and
governed by the laws of the State, except that the laws of the United States of America shall apply to the
extent such federal laws preempt Minnesota law, or address subjects not governed by Minnesota law, or
to the extent provisions of this Agreement are intended to provide for compliance with the Code.
(The remainder of this page is intentionally left blank.)
ARTICLE TWO
THE BONDS
Section 2-l. Pledge Effected by the Paying A eg nt Agreement; Special Obli atg ions. The
Bonds are special limited obligations of the Issuer, the principal of and interest on which. are payable
solely from Available Tax Increment and shall be a valid claim of the respective Holders only against the
Available Tax Increment which is pledged and shall be used for no other purpose than to pay the
principal of and interest on the Bonds, except as otherwise expressly authorized in this Agreement. The
Bonds are not general or moral obligations of the City, the State, the Issuer or any political subdivision
or Issuer of the State. The Holder shall have no right to compel. the exercise of the taxing powers of the
State, the Issuer or any political subdivision or Issuer of the State. The Bonds are not an indebtedness of
the State, the Issuer or any political_ subdivision or Issuer of the State tx~ithin the meaning of any
constitutional or statutory limitation on indebtedness, other than the HIZA Act and the Tax Increment
Act.
Section 2-2. Farms Generallv. The Bonds and the Paying Agent's certificate of authentication.
shall be in substantially the forms set forth. in EXHIBIT A, with such other appropriate insertions,
omissions, substitutions or other variations as are required or permitted by this Agreement. Definitive
Bonds may be printed, lithographed or engraved or produced by a combination of these methods, or may
be produced in any other manner. All signatures appearing on the Bonds (other than the signature of an
officer of the Paying Agent appearing in the certificate of authentication} may be facsimiles.
Section 2-3. Principal Amount, Designation, Interest Rates, Maturities.
(a) The Bonds shall be issued under and secured by this Agreement and denominated "Tax
Increment Revenue Bonds (Huset Park Area Redevelopment Project), Series 2007." The Bonds shall be
issued in the aggregate principal amount of $2,890,000 and dated as of the date of original issue or the
first day of the month of original issue, as directed by the Purchaser.
(b) The Bonds shall be issued in fully registered form, numbered separately consecutively
upward, and the Bonds shall bear interest from their date of issue, payable each Payment Date. If a
default has occurred in the payment of any interest, the Paying Agent shall establish a special Record
Date for such payment as hereinafter provided. Interest on the Bonds shall be computed on the basis of a
3~0-day year with Twelve (i2} months of thirty (30} days.
(c} The Bonds shall mature on the dates listed below, in the following respective principal
amounts, and shall bear interest at the rates per amlum for each stated maturity of the Bonds as set forth
below opposite the respective stated maturities:
Stated Maturity Principal Amount
Interest Rate
February 1 S, 2017 $ 495,000 5.000%
February 15, 2022 510,000 5.200
February 15, 2032 1,885,000 5.375
(d) To the extent lawful, interest shall accrue on all principal of and interest on the Bonds not
paid when due at the rate of interest accruing on the Bonds immediately prior to such default.
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(e) The Bonds shall be subject to redemption and prepayment prior to maturity as provided
in Article Three.
Section 2-4. Payment of Interest and Prinei~al.
(a) The Bonds shall be payable in lawful money of the United States of America without
deduction for the services of the Paying Agent in immediately available funds: (i} in the case of principal
of, redemption price and any premium on such Bond, delivered or transmitted to the Holder when due;
and (ii) in the case of interest on such Bonds, delivered or transmitted on any date interest is due to the
Holder of that Bond at the close of business on the Record Date applicable to that Payment Date (the
"Regular Record Date"}. All Bonds shall be payable as to principal and redemption price in lawful
money of the United States at the principal office of the Paying Agent upon presentment and. surrender of
the Bonds being paid, and interest on each Bond shall be payable by check or draft drawn upon the
Paying Agent and mailed on the applicable Payment Date to the Holder thereof at the address of such
Holder as reflected on the Band Register on the Regular Record Date; provided that upon written
instruction from any Holder of not less than $1,000,000 principal amount of the Bonds received at least
five days prior to the Regular Record Date (or all Outstanding Bonds, if less than $1,000,000 principal
amount of Bonds is Outstanding), payments to such Holder may be made to such Holder in immediately
available funds, on the date such payment is due, by wire transfer as instructed by the Holder and upon
payment by the Holder of the cast of such wire transfer.
(b) Notwithstanding the foregoing, if and to the extent that the Issuer shall fail to make
payment or provision for payment of interest on any Bond due on any date, that interest ("defaulted
interest") shall cease to be payable to the person who was the Holder of that Bond. as of the original
Regular Record Date. When money becomes available for payment of such defaulted interest: (i) the
Paying Agent shall establish a "Special Record Date" for the payment of such defaulted interest which
shall be not more than fifteen (15) nor fewer than ten days prior to the date of the proposed payment; and
(ii) the Paying Agent shall cause notice of the proposed payment and of the Special Record Date to be
mailed by first class mail, postage prepaid, to each Holder at its address as it appears on the Bond
Register not fewer than ten days prior to the Special Record Date and, thereafter, such defaulted interest
shall be payable to the persons who are the Holders of the Bonds at the close of business on the Special
Record Date as above established.
Section 2-5. Registered Form and Denominations. All Bonds shall be in fully registered form
without coupons in Authorized Denominations and shall be issued in the Stated Maturities and shall bear
interest at such rages per am;um and have such other tern°~s as are set fortl~~ in this Agreement.
Section 2-6. Execution of Bonds. Each Bond shall be executed in the name of, and on behalf
of, the Issuer by the manual, facsimile or photocopied signature of its Executive Director, but the Issuer's
corporate seal may be omitted as permitted by law. Any Bond may be signed, sealed or attested on behalf
of the Issuer by any person who, at the date of such act, shall hold the proper office, and the validity
thereof shall not be impaired by the fact that one or more officers authorized to execute such Band shall
have ceased to be in office or did not hold such office on the formal issuance date thereof.
Section 2-7. Authentication of Bonds. Each Bond shall bear thereon a certificate of
authentication, substantially in the form set forth in EXHIBIT A. Only such Bonds as shall bear thereon
such. certificate of authentication, duly executed, shall be entitled to any security, right or benefit under
this Agreement. No Bond shall be valid or obligatory for any purpose unless such certificate of
authentication upon such Band shall have been manually executed by the Paying Agent. The Paying
Agent shall authenticate the signature of the officers of the Issuer on each Bond by execution of the
Paying Agent's Certificate of Authentication on the Bond and by inserting as the date of registration in
the space provided the date on which the Bond is authenticated, except that for purposes of delivering the
Bonds at the Bond Closing to the Purchaser, the Paying Agent shall insert as a date of registration the date
of original issue. Such certificate of authentication upon any Bond executed by the Paying Agent as
herein provided on behalf of the Issuer shall be conclusive and the only evidence that the Bond so
authenticated has been duly authenticated and delivered under this Agreement.
Section 2-8. Registration and Transfer of Bonds and Agent Therefor. The Issuer shall
maintain and keep, at the principal office of the Paying Agent, a Bond Register for the registration and
transfer of Bonds and, upon presentation thereof for such purpose at the principal office of the Paying
Agent, the Issuer shall register or cause to be registered therein and permit to be transferred thereon or to
be exchanged, under such reasonable regulations as the Issuer or Paying Agent may prescribe, any Bond
entitled to registration, transfer or exchange. The Paying Agent is hereby irrevocably appointed the agent
of the Issuer for such registration, transfer or exchange of Bonds.
Section 2-9. Transfer and Exchange of Bonds.
(a) Each Bond may be exchanged at the option of the Holder, and each Bond may be
transferred, upon presentation and surrender of the Bond at the principal office of the Paying Agent,
together with an assignment or instrument of transfer duly executed by the Holder or its duly authorized
attorney-in-fact in form satisfactory to the Paying Agent. Upon such presentation and surrender of a
Bond, the Issuer shall execute and the Paying Agent shall authenticate a Bond or Bonds of the same
series, maturity, and aggregate principal amount, bearing the same interest rate as the Bond surrendered;
whereupon the new Bond or Bonds shall be valid obligations of the Issuer secured hereby and shall
evidence all rights and privileges of the surrendered Bond, including all principal and all accrued and
unpaid interest due or payable thereon. All surrendered Bonds shall be cancelled.
(b) For every such exchange or transfer of Bonds, the Paying Agent may make a charge
sufficient to reimburse the Paying Agent for any tax, fee or other governmental charge required to be paid
with respect to such exchange or transfer, as well as the cost of preparing each new Bond upon each.
exchange or transfer and any other expenses of the Paying Agent incurred in connection with such
exchange or transfer shall be paid by the Issuer.
(c) Neither the Issuer nor the Paying Agent shall be required to register, transfer or exchange
Bonds for a period of fifteen (15) days next preceding any selection of Bonds to be redeemed or thereafter
any Bonds selected, called or being called for redemption as a whole or the portion being redeemed of
any Bonds selected, called or being called for redemption in part.
(d) No Bond may be transferred or exchanged in violation of any applicable federal or state
securities laws.
Section 2-10. Bonds Mutilated, Destroyed, Stolen or Lost. In the event that any Bond is
mutilated, destroyed, stolen or lost, the Issuer shall execute and the Paying Agent shall authenticate and
deliver, in lieu of any such mutilated, destroyed, stolen or Lost Bond, a new Bond of like date,
denomination and series as the Bond mutilated, destroyed, stolen or lost, but bearing a number not
contemporaneously outstanding, provided that, in the case of any mutilated Bond, such mutilated Band
shall first be surrendered to the Paying Agent, and in the case of any such destroyed, stolen or Lost Bond,
there shall be first furnished to the Paying Agent evidence of such destruction, theft or toss satisfactory to
the Paying Agent, together with indemnity in favor of the Paying Agent and the Issuer. The Paying
Agent may charge the Holder of such Bond their reasonable fees and expenses in this connection. All
such Bonds so surrendered to the Paying Agent shall be cancelled. by the Paying Agent. In case any such
mutilated, destroyed, stolen or lost Bond has become or is about to become due and payable, the Issuer
shall, instead of issuing a new Bond, cause the Paying Agent to pay such Bond out of money held by the
Paying Agent and available for such purpose. The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of
mutilated, destroyed, stolen or lost Bonds.
Section 2-11. Nonpresentment of Bonds. Except as otherwise provided by applicable law, in
the event any Band shall not be presented for payment when due, either at the stated Maturity thereof,
upon a Redemption Date, or otherwise, if money sufficient to pay such Bond shall have been made
available to the Paying Agent pursuant to the provisions of this Agreement for the benefit of the Holder
thereof, all liability of the Issuer to the Holder thereof for the payment of such Bond shall forthwith cease,
terminate and be completely discharged, and thereupon it shall be the duty of the Paying Agent to hold
such funds, without liability for interest thereon, for the benefit of the Holder of such Bond, who shall
thereafter be restricted exclusively to such funds, for any claim of whatever nature on his, her or its part
under this Agreement or on, or with respect to, said Bord; provided that any funds ~~~hich shall be so held
by the Paying Agent and which remain unclaimed by the Holder of any Bond not presented for payment
within two years after such date as upon which all of the Bonds shall have been fully paid or retired or
provision for such payment has been made as provided in Article Six of this Agreement shall be paid to
the Issuer, free of any trust or lien, and thereafter any such Holder shall look only to the Issuer for
payment of such amount without interest thereon and the Paying Agent shall have no further
responsibility with respect to such money.
Section 2-12. Temporary Bonds.
(a) Pending the preparation of definitive Bonds, the Issuer may execute, and the Paying
Agent shall authenticate and deliver, temporary Bonds which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any denomination, substantially of the tenor of the definitive
Bonds in lieu of which they are issued, with such changes as may be necessary to reflect more than one
stated Maturity in a temporary bond, in fully registered form, and with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such Bonds may determine, as
evidenced by their signing of such Bonds.
(b) If temporary Bonds are issued, the Issuer will cause definitive Bonds to be prepared
without unreasonable delay. After the preparation of definitive Bonds, the temporary Bonds shall be
exchangeable for definitive Bonds upon surrender of the temporary Bonds at the office of the Paying
Agent, without charge to the Holder. Upon surrender for cancellation of any one ar more temporary
Bonds, the Issuer shall execute and the Paying Agent shall authenticate and deliver in exchange therefor a
like principal amount of definitive Bonds of authorized denominations. Until so exchanged, the
temporary Bonds shall in ali respects be entitled to the same benefits under this Agreement as definitive
Bonds, and interest thereon, when and as payable, shall be paid to the Holder thereof as provided in this
Agreement.
Section 2-13. Description of the Book-Entry S sue.
(a) Notwithstanding any of the foregoing provisions of this Article II or other provisions of
this Paying Agent Agreement, the Bonds initially shall be issued in the form of a single authenticated
fully registered Bond far each stated maturity of Bonds, representing the aggregate principal amount of
the Bonds of such maturity, and the Bonds shall be governed by the provisions of this Section 2-13.
(b} Except as provided in this Section 2-13, all of the Qutstanding Bonds shall be registered
in the registration books kept by the Bond Registrar in the name of Cede & Co., as nominee of DTC.
With respect to the Bonds registered in the name of Cede & Co., as nominee of DTC, the Issuer, the
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Paying Agent, and the Bond Registrar shall have no responsibility or obligation to any Participant or to
any person on behalf of which a Participant holds an interest in the Bonds. Without limiting the
immediately preceding sentence, the Issuer, the Paying Agent, and the Bond Registrar shall have no
responsibility or obligation with respect to (a) the accuracy of the records of DTC, Cede & Co. or any
Participant with respect to any ownership interest in the Bonds, (b) the delivery to any Participant or any
other person, other than a Bondholder, as shown in the Bond Register, of any notice with respect to the
Bonds, including any notice of redemption, or (c} the payment to any Participant or any other person,
other than a Bondholder, as shown in the Bond Register, of any amount with respect to principal of,
premium, if any, or interest on the Bonds. The Issuer, the Paying Agent, and the Bond Registrar may
treat and consider the person in whose name each Bond is registered in the Bond Register as the Haider
and absolute owner of such Bond for the purpose of payment of principal, premium, if any, and interest
with respect to such Bond, for the purpose of giving notices of redemption and other matters with respect
to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes
whatsoever. The Paying P.gent shall pay all principal of, premium, if any, and interest on the Bonds only
to or upon the order of the respective Bondholders, as shown in the Bond Register, or their respective
attorneys duly authorized in writing, and all such payments shaIl be valid and effective to fully satisfy and
discharge the Issuer's obligations with respect to payment of principal of, premium, if any, and interest on
the Bonds to the extent of the sum or sums so paid. No person other than a Bondholder, as shown in the
Bond Register, shall receive a certificated Bond evidencing the obligation of the Issuer to make payments
of principal, premium, if any, and interest pursuant to this Paying Agent Agreement. Upon delivery by
DTC to the Issuer or the Paying Agent of written notice to the effect that DTC has determined to
substitute a new nominee in place of Cede & Co., and subject to the provisions herein with respect to
Regular Record Dates, the words "Cede & Co." in this Paying Agent Agreement shall refer to such new
nominee of DTC.
(c) The delivery by the Issuer of the Representation Letter shall not in any way limit the
provisions of preceding paragraph of this Section or in any other way impose upon the Issuer any
obligation whatsoever with respect to persons having interests in the Bonds other than the Bondholders,
as shown on the Bond Register kept by the Bond Registrar. The Paying Agent shall take all action
necessary for all representations of the Paying Agent in the Representation Letter with respect to the
Paying Agent to be complied with at all times.
(d) DTC may determine to discontinue providing its services with respect to the Bonds at any
time by giving reasonable written notice to the Issuer and the Paying Agent and discharging its
responsibilities with respect thereto under applicable law. The Issuer, in its discretion and without the
consent of any other person, may terminate the services of DTC with respect io the Bonds. Upon the
discontinuance or termination of the services of DTC with respect to the Bonds, unless a substitute
securities depository is appointed to undertake the functions of DTC hereunder, the Issuer is obligated to
deliver Bond certificates to the beneficial owners of the Bonds, as described herein, at its expense, and the
Bonds shall no Longer be restricted to being registered in the name of Cede & Co. as nominee of DTC, but
may be registered in whatever name or names Bondholders transferring or exchanging Bonds shall
designate, in accordance with the provisions of this Paying Agent Agreement.
(e) Notwithstanding any other provision of this Paying Agent Agreement to the contrary, so
long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect
to principal of, premium, if any, and interest on such Bond and all notices with respect to such Bond shall.
be made and given, respectively, in the manner provided in the Representation Letter.
(f) The Paying Agent is hereby authorized and requested to execute and deliver the
Representation Letter and, in connection. with any successor nominee for DTC or any successor
la
depository, enter into comparable arrangements and shall have the same rights with respect to its actions
thereunder as it has with respect to its actions under this Paying Agent Agreement.
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ARTICLE THREE
REDEMPTION OF BONDS BEFORE MATURITY
Section 3-1. Redemption. The Bonds are subject to redemption prior to maturity as follows:
(a) Optional Redemption. The Bonds may be redeemed, in whole or in part, in principal
increments of $1,000, at the option of the Issuer on or after August 15, 2014, on any date for which timely
notice of redemption can be given, at a Redemption Price equal to 101% of the principal amount of the
Bonds so redeemed plus interest accrued thereon to the Redemption Date; and on or after August 15,
2015, on any date for which timely notice of redemption can be given, at a Redemption Price equal to the
principal amount of the Bonds so redeemed plus interest accrued thereon to the Redemption Date. Bonds
shall be subject to optional redemption pursua_n_t to this Sectio_n_ 3-1(a) only if funds to implement such
redemption are deposited in the Bond Fund on or before the date on which notice of redemption is
required to be given by Section 3-4.
(b) Scheduled Mandatory Redemption. The Bonds maturing on February 15, 2017,
February 15, 2022, and February 15, 2032, are subject to scheduled mandatory redemption on the
mandatory sinking fund redemption dates and in the principal amounts set forth in the following tables, at
a redemption price equal to the principal amount thereof plus accrued interest to the redemption date,
without premium, subject to pro rata reduction of such scheduled mandatory redemption payments to the
extent that such Bonds are redeemed prior to maturity otherwise than pursuant to such scheduled
mandatory redemption:
Bonds Maturing February 15, 201'7
Redemption Date Principal Amount Redemption Date Principal Amount
February 15, 2009 $ 9,000 February 15, 2014 $62,000
February 15, 2010 43,000 February 15, 2015 68,000
February 15, 2011 48,000 February 15, 2016 74,000
February 15, 2012 53,000 February 15, 2017* 80,000
February 15, 2013 58,000
*Maturity
Bonds Maturing February I5, 2022
Redemption Date Principal Amount Redemption Date Principal Amount
February 15, 2018 $ 87,000 February 15, 2021 $109,000
February 15, 2019 94,000 February I5, 2022* 118,000
February 15, 2020 102,000
*Maturity
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Bands Maturing February 15, 2032
Redemption Date Principal Amount Redemption Date Principal Amount
February 15, 2023 $127,000 February 15, 2028 $179,000
February 15, 2024 136,000 February 15, 2029 192,000
February 15, 2025 146,000 February 15, 2030 205,000
February 15, 2026 156,000 February 15, 2031 218,000
February 15, 2027 168,000 February 15, 2032* 358,000
*Maturity
(c) Mandatorm Redemption from Excess Available Tax Increment. The Bonds are subject to
mandatory redemption, in principal increments of $1,000, on each Payment Date on which the conditions
of Section 5-3(b(ii) hereof exist, at a redemption price equal to the principal amount of the Bonds to be
redeemed plus accrued interest to the redemption date, without premium, from Excess Available Tax
Increment held in the Prepayment Fund as required by Section 5-3(b)(ii} hereof.
Section 3-2. Election to Redeem; Notice to Paying_ Agent. In case of any redemption of
Outstanding Bonds pursuant to Section 3-1(a) and Section 3-1(c), the Issuer shall notify the Paying Agent
pursuant to an Issuer Order, at least thirty (30) days prior to the Redemption Date fixed by the Issuer
(unless a shorter notice shall be satisfactory to the Paying Agent), of such Redemption Date and of the
principal amount of Bonds to be redeemed.
Section 3-3. Selection of Bonds to be Redeemed.
(a) In the case of a partial redemption pursuant to Section 3-1(a), the Paying Agent shall
select by lot the maturities of the Bonds to be redeemed and the principal amount (in increments of
$1,000) to be redeemed from each maturity.
(b) In the case of a partial redemption pursuant to Section 3-1(c), the Bonds shall be
redeemed in inverse order of maturity.
(c) The Paying Agent shall promptly notify the Issuer, in writing, of the Bonds selected for
redemption and, in the case of any Bond selected for partial. redemption, the principal amount thereof to
be redeemed, provided that any Bonds Outstanding after a partial redemption shalt be in Authorized
Denominations.
(d) If less than all. of the Bonds are to be redeemed other than in accordance with the
scheduled mandatory redemption provisions of Section 3-1(b), the Bonds so redeemed shall be selected
by maturity as set forth in Section 3-3(a) or Section 3-3(b), as applicable, and the scheduled mandatory
redemption requirements for each maturity described in Section 3-1(b) shall be adjusted so that the
resulting decrease in debt service on the Bonds (including scheduled mandatory redemption payments)
during each six-month period commencing on each Payment Date is proportional, as nearly as
practicable.
Section 3-4. Notice of Redemption.
(a) Notice of redemption shall be given by first-class mail, postage pre-paid, mailed not less
than fifteen (15) days prior to the Redemption Date, to each Holder of Bands to be redeemed at the
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address of such Holder appearing in the Band Register. For Bonds registered to Cede & Co., as nominee
of DTC, notice of redemption may instead by given by electronic notice, sent not less than fifteen (IS)
days prior to the Redemption Date. Neither failure to give notice by mail to any Holder, nor any defect in
any notice so mailed, shall affect the validity of the proceedings for redemption of the Bonds held by any
Holder to which proper notice by mail has been given.
(b) All notices of redemption shall state: (i) the Redemption Date; (ii) the Redemption Price;
(iii) the principal amount of Bonds to be redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the Bonds to be redeemed, specifying the CUSIP
numbers of the Bonds to be redeemed and their registration number and stated Maturity; (iv) that on the
Redemption Date, the Redemption Price will become due and payable upon each such Bond, and that
interest thereon shall cease to accrue from and after such date, provided that if redemption is conditioned
on funds being deposited in the Bond Fund in an amount sufficient to effect such redemption, this
condition shall be stated in the notice and if sufficient funds are not so deposited ir. the Bond Fund, the
Bonds to be redeemed shall not be due and payable on the Redemption Date and interest shall continue to
accrue thereon; and (v) the place or places where such Bands are to be surrendered for payment of the
Redemption Price.
Section 3-5. Bonds Payable on Redemption Date.
(a) Notice of redemption having been given as aforesaid, the Bonds to be redeemed shall, on
the Redemption Date, become due and payable at the Redemption Price therein specified and from and
after such date such Bonds shall cease to bear interest, except as otherwise provided herein in the case of
a conditional redemption when insufficient funds are deposited in the Bond Fund to effect such
redemption. Subject to the foregoing provision, upon surrender of any such Bond for redemption in
accordance with such notice, such Bond shall be paid at the Redemption Price.
(b) If any Bond called for redemption shall not be so paid upon surrender thereof for
redemption, the principal (and premium, if any) shall, until paid, bear interest from the Redemption Date
(and, if lawful, interest on overdue installments of principal, premium, if any, and interest) at the rate
borne by said Bond.
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ARTICLE FOUR
COVENANTS OF THE ISSUER
Section 4-l. Payment of Principal and Interest. The Issuer covenants that it will promptly pay
or cause to be paid from funds pledged to the Bond Fund the principal of and interest on every Bond at
the place, on the dates and in the manner provided herein, in said Bond according to the terms hereof and
thereof. The principal and interest are payable from the Available Tax Increment hereby specifically
assigned and pledged to the payment thereof for the benefit of the Bondholders in the manner and to the
extent herein specified, and nothing in the Bonds or in this Agreement shall be considered as assigning or
pledging any other funds or assets of the Issuer for such purposes, except as expressly provided in this
Agreement.
Section 4-2. Revenue Covenants. For the protection of the Holders of the Bonds, the Issuer
herein covenants and agrees to and with the Holders thereof from time to time as provided in this Section:
(a) The Issuer shall not act or omit to act in any way that would deprive the Issuer of the
right to receive Available Tax Increment revenues or use Available Tax Increment revenues as provided
in this Agreement.
(b) Except to the extent otherwise provided in Section 4-3 hereof, the Issuer shall not pledge
or encumber Available Tax Increment in any manner that would create a pledge, lien or encumbrance
against the Available Tax Increment superior to, or on a parity with, the pledge of Available Tax
Increment provided for in this Agreement, This covenant shall not be construed to preclude an expressly
subordinate pledge of Available Tax Increment.
(c} The Issuer shall cause Anoka County to remit all tax increment revenues from the TIF
District to the Issuer promptly, and the Issuer shall promptly determine the amount thereof that constitutes
Tax Increment and Available Tax Increment and shall promptly deposit all Available Tax Increment to in
the Bond Fund.
(d) The Issuer will not change the method of computation of Tax Increment pursuant to
Minnesota Statutes, Section 469.177, subdivision 3(c}, in such a way that the amount of Tax Increment
revenues available to pay the Bonds will be reduced.
(e) The Issuer shall calculate debt service coverage on the Bonds and any Additional
Obligations as of each February 1, commencing February 1, 2009. Debt service coverage shall be
calculated as the Available Tax Increment received by the Issuer as of the prior August IS Payment Date
plus the Available Tax Increment received by the Issuer for payment on the immediately next February 15
Payment Date, divided by the total principal and interest due on such two Payment Dates. Written notice
of such debt service coverage shall be delivered to the Purchaser on or before each February 2, and to any
Bondholder promptly upon receipt of a written request therefor.
(f} The pledge of Available Tax Increment from any parcel within. the TIF District may be
released from the pledge to the Bonds under this Agreement upon a determination by the Issuer that, after
such release, the Available Tax Increment is projected to be sufficient to produce debt service coverage
for the Bonds and any Additional Obligations of at least 125 percent. For the purposes of this Section,
such projections will be based on the same assumptions described in the last two sentences of Section 4-3.
15
Section 4-3. Additional Obligations. The Authority may issue additional bonds or notes
secured by a parity pledge of the Available Tax Increment ("Additional Obligations"}, for the purpose of
funding Public Redevelopment Costs under the Contract upon satisfaction of the following conditions:
(a) the Redeveloper has met the conditions precedent to the issuance of such Additional
Obligations and the initial disbursement of proceeds thereof under the Contract; and
(b) improvements in the TIF District as of the date of issue of the Additional Obligations are (i)
completed, or under construction (evidenced by commencement of footings or foundations) and expected
to be substantially completed within fifteen months thereafter; and (ii) projected to generate Available
Tax Increment sufficient to produce debt service coverage for the Bonds and the proposed Additional
Obligations of at least 120 percent. For the purposes of this Section, Available Tax Increment will be
projected by the Issuer assuming taxes at the lower of the original local tax rate for the TIF District or the
most recently available local tax rate, assuming property class rates in effect at the time of calculation;
and assuming aone-percent annual increase in the tax capacity of property in the TIF District. Estimates
of market value of all improvements will be made by the Authority, but in the case of owner-occupied
housing shall not exceed the projected sales price of completed units.
Section 4-4. Obligations of Issuer as to Tax-Exempt Status of the Bonds.
(a) The Issuer makes the following representations with respect to the exclusion from gross
income of interest on the Bonds for federal income tax purposes:
(i) In addition to the Bonds, no other obligations have been or are expected to be
issued under Section 103 of the Code for sale at substantially the same time as the Bonds:
(A) that are sold pursuant to the same plan of financing; and (B) that are payable in whole or part
by the Issuer or otherwise have with the Bonds any common or pooled security for the payment
of debt service thereon; or (C) which are otherwise treated as the same "issue of obligations" as
the Bonds under Section 103(a} of the Code.
(ii) The Issuer will not use the proceeds of the Bonds in such a manner as to cause
the Bonds to be "arbitrage bonds" within the meaning of Section 148 of the Code; to this end, the
Issuer shall:
(A) maintain, or cause to be maintained, records identifying all gross
proceeds (as def ned in Section 148(f}(5}(B} cf the Code} attributable tc the Bonds and
the yield derived from all investments thereof, including specifically earnings in excess
of the yield on the Bonds and any earnings derived from the investment of such arbitrage
profit;
(B) make, or cause to be made, as of the end of each fifth Bond Year (or so
often as the Issuer shall determine or as may be required by the Treasury Regulations), a
determination of the amount, if any, of earnings required by Section 148(f) of the Code to
be paid to the United States by the Issuer as the rebate of arbitrage profits; and
(C) as additional consideration for the purchase of the Bonds by the
Purchaser and the loan of the money represented thereby, and in order to induce such
purchase by measures designed to ensure the excludability of the interest thereon from
the gross income of the owners thereof for federal income tax purposes, pay, or cause to
be paid, to the United States at least once every five Bond Years the amount, if any,
which is required to be paid to the United States as the Rebate Amount, including the last
16
installment which shall be made no later than sixty (60) days after the day on which the
Bonds are paid in full.
(iii) No portion of the proceeds of the Bands shall be used directly or indirectly to
acquire higher yielding investments or to replace funds which were used directly or indirectly to
acquire higher yielding investments, except (A) for a reasonable temporary period until such
proceeds are needed for the purpose for which the Bonds were issued, and (B) in addition to the
above in an amount not greater than $100,000. To this end, any proceeds of the Bonds and any
sums from time to time held in the Funds for the Bonds (or any other Issuer account which will
be used to pay debt service to become due on the Bonds) in excess of amounts which under then-
applicable federal arbitrage regulations may be invested without regard to yield shall not be
invested at a yield in excess of the applicable yield restrictions imposed by said arbitrage
regulations on such investments, after taking into account any applicable "temporary periods",
minor portion or resen~e made available under the federal arbitrage regulations, Money in the
Funds for the Bands shall not be invested in obligations or deposits issued by, guaranteed by or
insured by the United States or any Issuer or instrumentality thereof if and to the extent that such
investment would cause the Bonds to be "federally guaranteed" within the meaning of
Section 149(b) of the Code. The proceeds of the Bonds shall not be invested in other tax-exempt
obligations the interest on which is subject to alternative minimum tax under the Code, unless the
Issuer has received an opinion of Bond Counsel to the effect that such investment will not
jeopardize the tax-exempt status of the Bonds.
(vi) The Issuer hereby covenants not to use the proceeds of the Bonds, or to cause or
permit them or any of them to be used, or to enter into any deferred payment arrangements for the
cost of the Project, in such a manner as to cause the Bonds to be "private activity bonds" within
the meaning of Sections 103 and 141 through 150 of the Code.
(vii) Notwithstanding any other provisions of this Agreement to the contrary, the
Issuer shall not otherwise use any of the proceeds of the Bonds or take or fail to take any action
the effect of which would cause interest on the Bonds to be included in gross income of the
Holders thereof for federal income tax purposes.
(b) The obligations of the Issuer under this Section 4-4 shall survive the defeasance or
payment in full of the Bonds.
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17
ARTICLE FIVE
FUNDS, APPLICATION OF AVAILABLE TAX INCREMENT AND OTHER MATTERS
Section 5-1. Establishment of Funds. The Issuer hereby establishes and shall maintain a Cost
of Issuance Fund, a Project Fund, a Bond Fund, a Capitalized Interest Fund, a Reserve Fund, a
Prepayment Fund and a Rebate Fund.
Section 5-2. Application of Proceeds. On the Bond Closing, the Issuer will receive proceeds
of the Bonds in the amount of $2,810,092.25 (the par amount of the Bonds, less the underwriter's
discount of $57,800 and Less original discount of $22,107.75}. The Issuer shall deposit or disburse such
proceeds of the Bonds as follows:
(a) $66,385.25 to the Cost of Issuance Fund.
(b) $2,537,846.33 to the Project Fund.
(c) $81,380.67 to the Capitalized Interest Fund.
(d) $124,480.00 to the Reserve Fund.
Section 5-3. Bond Fund.
(a} Upon receipt during each Bond Year, the Issuer shall deposit Available Tax Increment
into the Bond Fund in the amount that, together with any funds on deposit in the Bond Fund, is necessary
to pay principal and interest on the Bonds in that Bond Year. The Issuer shall also deposit in the Bond
Fund the amount referenced in Section 5-1(e).
(b) On each February 15, after the payment of interest and principal due on the Bonds, if
there is Excess Available Tax Increment, such Excess Available Tax Increment shall be applied first to
the credit of the Reserve Fund in any amount necessary to restore the balance therein to the Reserve
Requirement, and then as follows:
(i) If on that February 15, the Available Tax Increment in the most recently
completed Band Year was at least 120% of the principal and interest due with the respect to the
Bonds during that Bond Year, Excess Available Tax Increment is released from the pledge to the
Bonds and may be used by the Issuer for any purpose under law.
(ii) If on that February 15, the coverage test described in clause (i) of this paragraph
is not met for the most recently completed Bond Year, Excess Available Tax Increment shall be
transferred to the Prepayment Fund and shall be used far the redemption of the Bonds on the next
Payment Date pursuant to Section 3-1(c} hereof.
(c} All investment earnings on the funds in the Band Fund shall remain in the Bond Fund.
Section 5-4. Project Fund. The Issuer shall deposit in the Project Fund the amount referred to
in Section 5-2(b). The Issuer shall disburse funds from the Project Fund to the Redeveloper for
reimbursement of Public Redevelopment Costs upon receipt of the following: (i) a statement that each cast
identified in the certificate is a Public Redevelopment Cast as defined in the Contract and that no part of such
cost has been included in any previous certification or any disburseanent from any other public fmancing
18
source described in Article VII of the Contract, (ii} evidence that each identified Public Redevelopment Cost
has been paid or incurred by or on behalf of the Redeveloper, and (iii} a statement that no uncured event of
default by the Redeveloper has occurred and is continuing under the Contract.
All income derived from the investment of amounts in the Project Fund shall be credited as
received to the Project Fund. On the Completion Date of the Project, after payment of all Public
Redevelopment Costs relating thereto, any balance remaining in the Project Fund shall be transferred to
the Bond Fund and. used to pay principal and interest on the Bonds on the next Payment Date. Any
amounts so transferred to the Bond Fund shall be invested at a yield not exceeding the yield of the Bonds
unless the Issuer receives an opinion of Bond Counsel that investment at an unrestricted yield will not
adversely affect the exemption of interest on any Bonds.
Section 5-5. Capitalized Interest Fund. The Issuer shall deposit in the Capitalized Interest
Fund the amounts referred to in Section 5-2(c}. The Issuer shall, at least five days before any Payment
Date, transfer from the Capitalized Interest Account to the Bond Fund such amount which is sufficient
(together with amounts already on deposit in the Bond Fund or expected to be on deposit in the Bond
Fund on the next Payment Date, if any), for payment of all accrued interest and principal due on the
Bonds on the next Payment Date.
All income derived from the investment of amounts in the Capitalized Interest Fund, shall be
credited as received to the Capitalized Interest Fund.
If any funds remain in the Capitalized Interest Account after February 15, 2008, the remaining
funds shall be transferred to the Bond Fund and used to pay principal and interest on the Bonds on the
next Payment Date. Any amounts so transferred to the Bond Fund shall be invested at a yield not
exceeding the yield of the Bonds unless the Issuer receives an opinion of Bond Counsel that investment at
an unrestricted yield will not adversely affect the exemption of interest on any Bonds.
Section S-6. Costs of Issuance Fund. The Issuer shall deposit in the Costs of Issuance Fund
the amounts referred to in Section 5-Z(a). The Issuer shall use money on deposit to the credit of the Costs
of Issuance Fund, on the Bond Closing or as soon thereafter as practicable, to pay the costs of issuance of
the Bonds upon presentation of invoices therefor. Amounts remaining on deposit in the Costs of Issuance
Fund thirty (30) days after the date of issuance of the Bonds shall be transferred to the Capitalized Interest
Fund. Upon such final disbursement, the Issuer shall close the Costs of Issuance Fund.
Section 5-7, Reserve Fund.
(a) The Issuer shall deposit in the Reserve Fund the amounts referred to in Section 5-2(d),
representing the Reserve Requirement. The Issuer shall also deposit in the Reserve Fund the amounts of
Excess Available Tax Increment, if any, credited to the Reserve Fund in accordance with Section 5-3(b}
hereof.
(b) The Issuer shall transfer from the Reserve Fund to the Bond Fund on the day preceding
any Payment Date, such amount which, together with amounts already on deposit in the Bond Fund is
required. far the payment from the Bond Fund of interest and principal due on the next Payment Date.
(c) The Issuer shall transfer any amount in excess of the Reserve Requirement held in the
Reserve Fund on the day after a Payment Date (i) to the Rebate Fund, to the extent such amount consists
of any Rebate Amount and (ii) to the Bond Fund any other amounts.
19
Section 5-8. Prepayment Fund.
(a) Upon the transfer of Excess Available Tax Increment to the Prepayment Fund on any
Payment Date, the Issuer shall apply all such funds, along with interest earnings thereon, on the next
Payment Date to the redemption and prepayment of the Bonds in accordance with Article Three hereof.
(b} All investment earnings on the funds in the Prepayment Fund shall remain in the
Prepayment Fund.
Section 5-9. Rebate Fund.
(a) The Issuer shall establish and maintain a fund separate from any other fund established
and maintained hereunder, designated as the Rebate Fund. The Issuer shall deposit in the Rebate Fund
any P`ebate Amount tamed on the Funds described in, and pursuant to the provisions of, this Article Five.
Subject to the transfer provisions provided, all money at any time deposited in the Rebate Fund shall be
held by the Issuer in trust, to the extent required to satisfy the obligation of the Issuer to rebate arbitrage
profits to the United States of America. Neither the Issuer nor the Holder of any Bonds shall have rights
in or claim to such money. All amounts deposited into or on deposit in the Rebate Fund shall be
governed by this Section.
(b) The Issuer shall transfer from the Funds the amounts stated in an Issuer Order to be
Rebate Amounts to the Rebate Fund, for which purpose the Issuer Order shall specify the exact amounts
to be transferred from each Fund. In addition, there shall be deposited in the Rebate Fund amounts
provided by the Issuer and stated in an accompanying Issuer Order to be Rebate Amounts required to be
deposited in the Rebate Fund.
(c) The Issuer shall have no obligation to make any rebate payments pursuant to this Section,
other than from money held in the Funds created under this Indenture or from other money provided to it
by the Issuer.
(d} The Issuer shall invest all amounts held in the Rebate Fund, pursuant to the provisions of
this Section 5-9, and subject to written instructions of the Issuer. The Issuer shall retain in the Rebate
Fund alt earnings on investments of amounts held in the Rebate Fund (calculated by taking into account
net gains or losses on sales or exchanges and taking into account amortized discount or premium as a gain
or loss, respectively). Money shall not be transferred from the Rebate Fund except as provided in
paragraph (e} below.
(e) The Issuer shall remit part or all of the balances in the Rebate Fund to the United States,
as required by Section 148(a) of the Code at the written direction of the firm engaged by the Issuer to
provide rebate services. If on the first day of any Bond Year the amount credited to the Rebate Fund
exceeds the Rebate Requirement, if the Issuer so directs, the Issuer will deposit money into or transfer
money out of the Rebate Fund to the extent of such excess from or into such accounts or funds held by the
Issuer hereunder, as directed by the Issuer's written directions. Any funds remaining in the Rebate Fund
after redemption and payment of all of the Bonds, and receipt of evidence from the firm engaged by the
Issuer to perform rebate services that any Rebate Requirement has been paid, and satisfied, shall be
withdrawn and remitted to the Issuer.
(f) Notwithstanding any other provision of this Indenture, the obligation to remit the Rebate
Amounts to the United States and to comply with all other requirements of this Section shall survive the
defeasance or payment in full of the Bonds.
za
(g} Notwithstanding any provision of this Section, if the Issuer receives an opinion of Bond
Counsel to the effect that any action required under this Section is no longer required, or to the effect that
some further action is required, to maintain the exclusion from gross income of the interest with respect to
the Bonds pursuant to Section 103 of the Cade, the Issuer may rely conclusively on such opinion in
complying with the provisions hereof:
Section 5-10. Investments. Money held for the credit of any Fund established by this
Article Five shall be invested as received and reinvested by the Issuer in Permitted Investments only;
provided that any money credited to the Reserve Fund shall be invested in instruments with a maturity no
longer than five years. The Issuer covenants and certifies for the benefit of the Purchaser and Holders of
the Bonds from time to time Outstanding that money on deposit in any Fund, whether or not such money
was derived from the proceeds of the sale of the Bonds or from any other sources, are not intended to be
used in a manner which will cause the interest on the Bonds to become includable in gross income for
federal income tax purposes.
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21
ARTICLE SIX
DISCHARGE OF LIEN
Section 6-l. Defeasance. When all Bonds have been discharged as provided in this Section,
ali pledges, covenants and other rights granted by this Resolution to the Holders shall, to the extent
permitted by law, cease. The Issuer may discharge its obligations with respect to any Bonds which are
due on any date by irrevocably depositing with the Paying Agent on or before that date a sum sufficient
for the payment thereof in full; or if any Bond should not be paid when due, it may nevertheless be
discharged by depositing with the Paying Agent a sum sufficient for the payment thereof in full with
interest accrued to the date of such deposit. The Issuer may also discharge its obligations with respect to
any prepayable Bonds called for redemption on any date when they are prepayable according to their
terms, by depositing with the Paying Agent on or before that date a sum sufficient for the payment thereof
in full, provided that notice of redemption thereof has been duly given. The Issuer 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 suitable banking
institution qualified by law as an escrow agent for this purpose, cash or securities described in Minnesota
Statutes, Section 475.67, Subdivision 8, bearing interest payable at such times and at such rates and
maturing on such dates as shall be required, without regard to sale and/or reinvestment, to pay all amounts
to become due thereon to maturity or, if notice of redemption as herein required has been duly provided
for, to such earlier redemption date.
(The remainder of this page is intentionally left blank.)
22
ARTICLE SEVEN
THE FRYING AGENT
Section 7-1. Duties of Paving Agent. The duties and obligations of the Paying Agent as
provided herein shall include the following: (i) act as paying agent, authenticating agent, registrar, and
transfer agent for the Bonds; (ii) maintain a list of Holders as set forth herein and provide the Issuer with
such list upon request; (iii) effect Bond transfers and related administration in compliance with Securities
and Exchange Commission regulations for the transfer of registered securities, if applicable; (iv) maintain
a certificate inventory secured on bank premises if requested by the Issuer; (v) maintain files on securities
reported lost or stolen; (vi} issue replacement certificates for lost or stolen securities when properly
indemnified; (vii) coordinate the transfer of funds from the Issuer to include advance billing for debt
service requirements; (viii} disburse semiannual interest payments and principal payments to Holders as
due upon the receipt of debt service funds; (ix} cancel and destroy Bonds which have been paid at
maturity or upon earlier redemption or submitted for exchange or transfer; and (x) effect call and
redemption provisions as directed by the Issuer as provided for herein.
Section 7-2. Fees. Charges, and Expenses of the Pang Agent. The Paying Agent shall be
entitled to payment and/or reimbursement for reasonable fees for its services rendered hereunder and all
necessary advances, counsel fees, and other expenses reasonable or necessarily made or incurred by it in
connection with such service. The annual fee of the Paying Agent shall be $650, plus $100 in any Bond
Year in which Excess Available Tax Increment is deposited in the Prepayment Fund under Section
5-3(b)(ii) hereof. The Issuer shall pay to the Paying Agent, on the date of the execution and delivery of
this Agreement, the amount of $975, which represents the Paying Agent's fee through February 15, 2008.
Section 7-3. Resignation of the Pang Agent. The Paying Agent may at any time resign as
Paying Agent by giving thirty (30) days written notice by registered or certified mail to the Issuer and the
Holders. Such resignation shall take effect upon the appointment of a successor by the Issuer and such
successor's acceptance of such appointment.
follows:
Section 7-4. Covenants of Issuer. The Issuer covenants and agrees with the Paying Agent as
(a) The Paying Agent shall have no responsibility or liability whatsoever for (i) any
of the recitals herein or in any of the Bonds, (ii) the performance of or compliance with any
covenant, condition, term, or provision of this Agreement, and (iii) any undertaking or statement
of the Issuer hereunder of under this Agreement
(b) All payments to be made by, and all acts and duties required to be done by, the
Paying Agent under the terms and provisions of this Agreement, shall be made and done by the
Paying Agent without any further direction or authority of the Issuer; provided, however, that
with respect to any payments, that collected funds sufficient to make the respective payments are
on deposit with the Paying Agent.
(c) The Paying Agent has all the powers and duties herein set forth with no liability
in connection with any act or omission to act hereunder, except for its own negligence or willful
misconduct, and shall be under no obligation to institute any suit or action or other proceeding
under this Agreement or to enter any appearance in any suit, action or proceeding in which it may
be defendant or to take any steps in the enforcement of its, or any, rights and powers hereunder,
nor shall it be deemed to have failed to take any such action, unless and until it shall have been
2~
directed and indemnified by the party requesting that certain actions be taken to its satisfaction
against any and all casts and expenses, outlays, counsel fees and other disbursements, including
its own reasonable fees, and if any judgment, decree, or recovery be obtained by the Paying
Agent, payment of all sums due it, as aforesaid, shall be a first charge against the amount of any
such judgment, decree, or recovery.
(d) The obligations and duties of the Paying Agent are confined to those specifically
enumerated in this Agreement. The Paying Agent shall not be subject to, nor be under any
obligation to ascertain or construe the terms and conditions of any other instrument, whether or
not now or hereafter deposited with or delivered to the Paying Agent, or referred to in this
Agreement, nor shall the Paying Agent be obligated to inquire as to the form, execution,
sufficiency, or validity of any such instrument, nor to inquire as to the identity, authority, or rights
of the person or persons executing or delivering the same.
(e) The Paying Agent shall not be personally liable for any act which it may do or
omit to do hereunder in good faith and in the exercise of its own best judgment.
(fj The Paying Agent may consult with counsel. Any act done or omitted by the
Paying Agent pursuant to the advice of its counsel shall be deemed conclusively to have been
performed of omitted in good faith by the Paying Agent.
(g) The Paying Agent may rely and shall be protected in acting upon any certificate,
instrument, opinion, notice, letter, telegram, or any other document or security delivered to the
Paying Agent and believed by it to be genuine and to have been signed by the proper party of
parties.
(h) The Issuer covenants and agrees to indemnify and to hold the Paying Agent
harmless from and against all costs, damages, judgments, attorneys' fees (whether such attorneys
shall be regularly retained or specially employed), expenses, obligations, and liabilities of every
kind and nature which the Paying Agent may incur, sustain, or be required to pay in connection
with or arising out of this Agreement, and to pay to the Paying Agent on demand the amount of
all such costs, damages, judgments, attorneys' fees, expenses, obligations, and liabilities.
(The remainder of this page is intentionally left blank.)
2,4
ARTICLE EIGHT
MISCELLANEOUS
Section 8-1. Severability.
(a} If any provision of this Agreement shall be held or deemed to be or shall, in fact, be
inoperative or unenforceable as applied in any particular case in any jurisdiction or jurisdictions or in all
jurisdictions or in all cases because it conflicts with any provisions of any constitution or statute or rule of
public policy, or for any other reason, such circumstances shall not have the effect of rendering the
provision in question inoperative or unenforceable in any other case or circumstance, or of rendering any
other provision or provisions contained herein invalid, inoperative or unenforceable to any extent
whatever.
(b) The invalidity of any one or more phrases, sentences, clauses or paragraphs contained in
this Agreement shall not affect the remaining portions of this Agreement or any part thereof.
Section 8-2. Notices. All notices, certificates or other communications hereunder shall be in
writing and shall be deemed given when delivered personally or mailed by first class mail, postage
prepaid, with proper address as indicated below. The Issuer and the Paying Agent may, by written notice
given by each to the other, designate any address or addresses to which notices, certificates or other
communications to them shall be sent when required as contemplated by this Agreement. Until otherwise
provided by the respective parties, all notices, certificates and communications to each of them shall be
addressed.as follows:
To the Issuer: Columbia Heights Economic Development Authority
590 40`h Avenue NE
Columbia Heights, Minnesota
Attention: Project Director
To the Paying Agent: Bond Trust Services Corporation
Suite 110
3060 Centre Pointe Drive
Roseville, Minnesota 55113
Section 8-3. Counterparts. This Paying Agent Agreement may be simultaneously executed in
several counterparts, each of which shall be an original and all of which shall constitute but one and the
same instrument.
Section 8-4. Limitation of Liability of Issuer and its Officers, Employees and Agents. TO
THE EXTENT PERMITTED BY LAW, NO PROVISION, COVENANT OR AGREEMENT
CONTAINED IN THIS PAYING AGENT AGREEMENT OR THE BONDS OR ANY
OBLIGATION HEREIN OR THEREIN IlVIl'OSED UPON THE ISSUER, OR THE BREACH
THEREOF, SHALL CONSTITUTE OR GIVE RISE TO OR IMPOSE UPON THE ISSUER OR
ANY OF THEIR OFFICERS, EMPLOYEES OR AGENTS A PECUNIARY LIABILITY OR A
CHARGE UPON THE ISSUER'S GENERAL CREDIT OR T G POWERS.
Section 8-5. Amounts Remaining in Funds. Any amounts remaining in the Funds and
administered by the Paying Agent, after adequate provision has been made to discharge the Bonds, shall
belong to and be paid to the Issuer.
25
IN WITNESS WHEREOF, the Issuer has caused these presents to be signed in its name and on
its behalf by its board of commissioners, and to evidence its acceptance of the trusts hereby created, Bond
A e_ .. ,a +tn,. .1+~ +!, L.m o~ ;n itc Hama anra
1 rust ~erV1CeS C;OTpOratlOn, aS Yaylllg ~getit, 1taS Gaiiscu utcsc presettw w w s;g;~„u ,.~ ._~ ==u===~ ~~.-~
behalf by its duly authorized officers, all as of the first day of August, 2007.
B
By
~L. ,~
Executive Di e ~ or-Walter R. Fehst
S-1
COLUMBIA HEIGHTS ECONOMIC
DEVELOPMENT AUTIIORITY,
as Issuer
Execution page of the Paying Agent to the Paying Agent Agreement, dated as of August 1, 2007,
between the Columbia Heights Economic Development Authority, as Issuer, and Bond Trust Services
Corporation, as Paying Agent.
BOND TRUST SERVICES CORPORATION,
as Paying Agent
By ~=-` ~ ,1 ` !_
Its ~ k'~~~ etc
s-2
EXHIBIT A
Form of Bond
No. R-
UNITED STATES OF AMERICA
STATE OF MINNESOTA
ANOKA COUNTY
Columbia Heights Economic Development Authority
Tai: Increment Revenue Bands
(Iluset Park Area Redevelopment Project)
Series 2007
Maturity Date
Date of Issuance
Interest Rate CUSIP
February 15, 20_ August 3, 2007
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT: DOLLARS
KNOW ALL PERSONS BY THESE PRESENTS that the Columbia Heights Economic
Development Authority, a public body corporate and politic organized and existing under the laws of the
State of Minnesota (the "Issuer"}, certifies that it is indebted and for value received promises to pay to the
registered owner specified above, or registered assigns, in the manner hereinafter set forth but only out of
its Bond Fund or Prepayment Fund the principal amount specified above, on the stated maturity date
specified above, unless called for earlier redemption, and to pay interest thereon semiannually on
February 15 and August 15 of each year (each a "Payment Date"), commencing February 15, 2008, at the
rate per annum specified above (calculated on the basis of a 360-day year of twelve 30-day months) until
the principal sum is paid or has been provided for. This Bond will bear interest from the most recent
Payment Date to which interest has been paid or, if no interest has been paid, from the date of original
issue hereof: The principal. of and premium, if any, on this Bond are payable upon presentation and
surrender hereof at the principal corporate trust office of Bond Trust Services Corporation, as Paying
Agent (the "Paying Agent," which term includes any successor to its functions under the Paying Agent
Agreement hereinafter referred to}, acting as paying agent, or any successor paying agent duly appointed
by the Issuer. Interest on this Bond will be paid on each Payment Date by check or draft drawn upon the
Paying Agent mailed (or under certain conditions specified in the Paying Agent Agreement sent by wire
transfer} to the person in whose name this Bond is registered (the "Holder" or "Bondholder") on the
registration books of the Issuer maintained by the Paying Agent and at the address appearing thereon at
the close of business on the fifteenth day of the calendar month preceding such Payment Date (the
"Regular Record Date"). Any interest not so timely paid shall cease to be payable to the person who is
the Holder hereof as of the Regular Record Date, and shall be payable to the person who is the Holder
hereof at the claw of business on a date (the "Special Record Date") fixed by the Paying Agent whenever
money becomes available for payment of the defaulted interest. Nance of the Special Record Date shall
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be given to Bondholders not less than ten days prior to the Special Record Date. The principal of and
interest on this Bond are payable in lawful money of the United States of America.
If the date for payment of the principal of, premium, if any, or interest on this Bond shall be a
Saturday, Sunday, Legal holiday or a day on which banking institutions in the City of New York, New
York, or the city where the principal office of the Paying Agent is located are authorized by law or
executive order to close, then the date for such payment shall be the next succeeding day which is not a
Saturday, Sunday, legal holiday or a day on which such banking institutions are authorized to close, and
payment on such date shall have the same force and effect as if made on the nominal date of payment.
This Bond is one of an issue in the aggregate principal amount of $2,890,000 (the "Bonds"), all of
like date of original issue and tenor, except as to number, maturity, interest rate, denomination, and
redemption privilege, issued under and equally and ratably secured and entitled to the protection given by
an Paying Agent Agreement, dated as of August 1, 2007 (the "Paying Agent Agreement"), by and
between the Issuer and the Paying Agent. The Bonds are issued to finance certain public redevelopment
costs of a project under and pursuant to Minnesota Statutes, Sections 469.001 to 469.047 and 469.090 to
469.1081, as amended, and other applicable law (collectively, the "Act"}. Reference is made to the
Paying Agent Agreement, far a description of the provisions, among others, with respect to the nature and
extent of the security, the rights, duties and obligations of the Issuer and Paying Agent and the rights of
the Holders of the Bands, and the terms upon which the Bonds are issued and secured.
The Bonds are subject to redemption as follows:
(a) Optional Redemption. The Bonds may be redeemed, in whole or in part, in principal
increments of $1,000, at the option of the Issuer on or after August 15, 2014 on any date for which timely
notice of redemption can be given, at a redemption price equal to 101 % of the principal amount of the
Bonds so redeemed plus interest accrued thereon to the redemption date; and on or after August 15, 2015
on any date for which timely notice of redemption can be given, at a redemption price equal the principal
amount of the Bonds so redeemed plus interest accrued thereon to the redemption date.
(b} Scheduled Mandatory Redem tion. The Bonds maturing on February 15, 2017,
February 15, 2022, and February 15, 2032, are subject to scheduled mandatory redemption on the
mandatory sinking fund redemption dates and in the principal amounts set forth in the following tables, at
a redemption price equal to the principal amount thereof plus accrued interest to the redemption date,
without premium, subject to pro rata reduction of such scheduled mandatory redemption payments to the
extent that such Bonds are redeemed prior to maturity otherwise than pursuant to such scheduled
mandatary redemption:
Bonds Maturing February I5, 2017
Redemption Date Principal Amount Redemption Date Principal Amount
February 15, 2009 $ 9,000 February I s, 2014 $62,000
February 15, 2010 43,000 February 15, 2015 68,000
February 15, 2011 48,000 February 15, 2016 74,000
February 15, 2012 53,000 February I5, 2017* 80,000
February 15, 2013 58,000
*Maturity
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Bonds Maturing February 15, 2022
Redemption Date Principal Amount Redemption Date Principal Amount
February 15, 2018 $ 87,000 February 15, 2021 $109,000
February 15, 2019 94,000 February 15, 2022* 118,000
February 15, 2020 102,000
*Maturity
Bonds Maturing February 15, 2032
Redemption Date Principal Amount Redemption Date Principal Amount
February 1 S, 2023 $127,000 February 15, 2028 $179,000
February 15, 2024 136,000 February 15, 2029 192,000
February 15, 2025 146,000 February 15, 2030 205,000
February 15, 2026 156,000 February 15, 2031 218,000
February 15, 2027 168,000 February 15, 2032* 358,000
*Maturity
(c) Mandatory Redemption from Excess Available Tax Increment. The Bonds are subject to
mandatory redemption, and shall be redeemed and prepaid in inverse order of maturity in principal
increments of $1,000, on each Payment Date on which the conditions specified in Section S-3(b)(ii) of the
Paying Agent Agreement exist, at a redemption price equal to the principal amount of the Bonds to be
redeemed plus accrued interest to the redemption date, without premium, from Excess Available Tax
Increment held in the Prepayment Fund as required by Section 5-3(b)(ii) of the Paying Agent Agreement.
In the case of redemption of less than. all Bonds Outstanding pursuant to paragraph (a) above, the
Paying Agent shall select the maturities of the Bonds to be redeemed, and the principal amount (in
increments of $1,000} to be redeemed from each maturity. If less than all of the Outstanding principal
amount of the Bonds of a specific maturity are to be redeemed, the specific Bonds to be redeemed shall be
selected by the Paying Agent at random or in such manner as the Paying Agent shall deem fair and
appropriate in increments of $1,000 or any integral multiple thereof.
Notice of redemption shaI1 be given by first class mail, postage prepaid, mailed not less than
fifteen (15) days prior to the Redemption Date, to each Holder of Bonds to be redeemed at the address of
the Holder appearing in the Bond Register. For Bonds registered to Cede & Co., as nominee of DTC,
notice of redemption may instead by given by electronic notice, sent not less than fifteen (15) days prior
to the Redemption Date. No defect in or failure to give notice by mail to any Holder shall affect the
validity of the proceedings for redemption of any Bond held by any Holder to which proper notice by
mail has been given.
The Bonds are issued pursuant to and in full compliance with the Constitution and laws of the
State of Minnesota, particularly the Act, and pursuant to Resolution No. 2007-13, adopted by the Board
of Commissioners of the Issuer on Juiy 24, 2007 (the "Resolution"}. The Bonds are special obligations
payable solely from Available Tax Increment, (as defined in the Paying Agent Agreement} and certain
other funds pledged to the payment of the Bonds and interest thereon.
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The Bonds are issued by the Issuer to aid in financing a project under the Act. The Bonds do not
constitute a general or moral obligation of the State of Minnesota or its political subdivisions, including
the Issuer. The Bonds, including interest thereon, are payable solely from the revenues and assets
expressly pledged to the payment thereof. The Bands shall not constitute a debt of the Issuer within the
meaning of any constitutional or statutory limitation of indebtedness.
As provided in the Paying Agent Agreement and subject to certain limitations therein set forth,
this Bond is transferable by the Holder in person or by his, her or its attorney duly authorized in writing at
the principal office of the Paying Agent upon presentation and surrender hereof to the Paying Agent, duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and
Paying Agent duly executed by, the Holder hereof or his, her or its attorney duly authorized in writing.
Thereupon the Issuer shall execute and the Paying Agent shall authenticate and deliver, in exchange for
this Bond, one or more new fully registered Bands in the name of the transferee (but not registered in
blank or to "bearer" or similar designation) of the same series, of an authorized denomination or
denominations, for the same aggregate principal amount and of the same stated maturity and interest rate.
The Bonds are issued as fully registered bonds in the denomination of $100,000 and integral
multiples of $1,000 in excess of $25,000. The Bonds are exchangeable for one or more Bonds of the
same series, aggregate principal amount, interest rate and maturity date, upon surrender thereof by the
Holder at the principal office of the Paying Agent, in the manner and upon payment of the charges
provided in the Paying Agent Agreement.
The Paying Agent may require payment of a sum sufficient to cover any tax, fee or other
governmental charge required to be made in connection with the transfer or exchange of this Bond.
The Issuer, Paying Agent and any agent of the Issuer or Paying Agent may treat the person in
whose name this Bond is registered as the owner hereof for the purpose of receiving payment as herein
provided (except as otherwise provided with respect to the Record Date) anal for all other purposes,
whether or not this Bond shall be overdue, and the Issuer, Paying Agent and agents of the Issuer or
Paying Agent shall not be affected by notice to the contrary.
The Bonds have been designated by the Issuer as "qualified tax-exempt obligations" for purposes
of Section 265(b)(3) of the federal Internal Revenue Code of 1986, as amended.
Capitaiizecl terms which are used but not defined herein shall have the same meanings given them
in, or pursuant to, the Paying Agent Agreement.
This Bond shall not be valid or become obligatory for any purpose or be entitled to any security
or benefit under the Paying Agent Agreement unless the Certificate of Authentication hereon shall have
been executed by the Paying Agent.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions and things required by the
Constitution and laws of the State of Minnesota to be done, to happen and to be performed, precedent to
and in the execution and delivery of the Paying Agent Agreement and in the issuance of this Bond, have
been done, have happened and have been performed, in regular and due form, time and manner as
required by law, and that this Bond, together with atl other obligations of the Issuer outstanding on the
Date of Original Issue hereof and on the date of its issuance and delivery to the purchaser, does not
exceed any constitutional or statutory limitation of indebtedness.
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IN WITNESS WHEREOF, the Columbia Heights Economic Development Authority, has caused
this Bond to be executed in its name and on its behalf by the facsimile signatures of its authorized
officers, as of the Date of Original Issue first above written.
COLUMBIA HEIGHTS ECONOMIC
DEVELOPMENT AUTHORITY,
as Issuer
By
Its President
By
Its Executive Director
PAYING AGENT'S CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds described in the within mentioned Paying Agent Agreement.
Date of Registration:
August _, 2007
BOND TRUST SERVICES CORPORATION,
as Paying Agent
By
Responsible Agent
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ASSIGNMENT
FOR VALUE RECENED, the undersigned hereby sells, assigns and transfers unto
(Please Print or Typewrite Name and Address of Transferee)
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 Number or
Other Identifying Number of Assignee.
Signature Guaranteed:
Notice: The signature to this assignment must
correspond with the name as it appears on the face
of this Bond in every particular, without alteration
or any change whatever.
NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of the Securities
Transfer Agent Medallion Program ("STAMP"), the Stock Exchange Medallion Program ("SEMP"), the
New York Stock Exchange, Inc. Medallion Signatures Program ("MSP") or other such "signature
guarantee program" as may be determined by the Registrar in addition to, or in substitution for, STEMP,
SEMP or MSP, all in accordance with the Securities Exchange Act of 1934, as amended.
The Registrar will not effect transfer of this Bond unless the information concerning the assignee
requested below is provided.
Name and Address:
(Include information for all joint owners if this Bond is held by
joint account.)
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ABBREVIATIONS
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
JT TEN - as joint tenants with right
of survivorship and not as tenants in
common
TEN ENT - as tenants by entireties
UNIF GIFT MIN ACT -
Custodian
(Gust}
under Uniform
(Minor)
Gifts or Transfers to Minors Act
_ (State)
Additional abbreviations may also be used though not in the above list.
cLZas-4a ~sr~}
311384v.4
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