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HomeMy WebLinkAbout23-070 Sale of General Obligation Bonds, Series 2023AEXTRACT OF MINUTES OF A MEETING OF THE CITY COLTNCIL CITY OF PRIOR LAKE, MINNESOTA HELD: APRIL 17,2023 Pursuant to due call and notice thereof, a regular or special meeting of the City Council of the City of Prior Lake, Scott County, Minnesota, was duly held at the City Hall on April 17, 2023, at7:00 P.M. for the purpose in part of authorizing the competitive negotiated sale of the $4,670,000 General Obligation Bonds, Series 2023A. The following members were present: Mayor Kirt Briggs, Councilors Zach Braid, Kevin Burkart, Kim Churchill and Victor Lake. and the following were absent: None. Member introduced the following resolution and moved its adoption: RESoLUTToN No. 7b -1C RESOLUTION PROVIDING FOR THE COMPETITIVE NEGOTIATED SALE OF GENERAL OBLIGATION BONDS, SERIES 2023A A. WHEREAS, the City Council of the City of Prior Lake, Minnesota (the "City"), has heretofore determined that it is necessary and expedient to issue General Obligation Bonds, Series 2023A (the "Bonds") to finance the City's street improvement projects and to pay costs associated with the issuance of the Bonds; and B. WHEREAS, the City has retained Northland Securities, Inc., in Minneapolis, Minnesota ("Northland"), as its independent municipal advisor and is therefore authorized to sell the Bonds by competitive negotiated sale in accordance with Minnesota Statutes, Section 475.60, Subdivision 2(9); and C. WHEREAS, the City has retained Taft Stettinius & Hollister LLP, in Minneapolis, Minnesota as its bond counsel for purposes of this financing. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Prior Lake, Minnesota, as follows: l. Authorization. The City Council hereby authorizes Northland to solicit proposals for the competitive negotiated sale of the Bonds. 2. Meeting: Proposal Opening. The City Council shall meet at the time and place specified in the Notice of Sale, in substantially the form attached hereto as Attachment A, for thepurpose of considering sealed proposals for and awarding the sale of the Bonds. The FinanceDirector, or designee, shall open proposals at the time anl place specified in the Notice of Sale. 76905027v1 I 4. Official Statement. In connection with the competitive negotiated sale of the Bonds, the Finance Director and other officers or employees of the City are hereby authorized to cooperate with Northland and participate in the preparation of an official statement for the Bonds, and to execute and deliver it on behalf of the City upon its completion. The for the adoption of the foregoing resolution was duly seconded by member and, after full discussion thereof and upon a vote being taken thereon, the following voted in favor thereof: and the following voted against the same: Whereupon the resolution was declared duly passed and adopted. 2 76905027vt STATE OF MINNESOTA COLTNTY OF SCOTT CITY OF PRIOR LAKE I, the undersigned, being the duly qualified and acting City Clerk of the City of Prior Lake, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes of a meeting of the City Council duly called and held on the date therein indicated, insofar as such minutes relate to the City's $4,670,000 General Obligation Bonds, Series 2023A. WITNESS my hand on April 17,2023. City 3 76905027v1 ATTACHMENT A NOTICE OF SALE $4,670,000x GENERAL OBLIGATION BONDS, SERIES 2023A CITY OF PRIOR LAKE, MINNESOTA (Book-Entry Only) NOTICE IS HEREBY GIVEN that these Bonds willbe offered for sale according to the following terms: TIME AND PLACE: Proposals (also referred to herein as "bids") will be opened by the City's Finance Director, or designee, on Tuesday, June 20, 2023, at 10:30 A.M., CT, at the offices of Northland Securities, Inc. (the City's "Municipal Advisor"), 150 South 5th Street, Suite 3300, Minneapolis, Minnesota 55402. Consideration of the Proposals for award of the sale will be by the City Council at its meeting at the City Offices beginning Tuesday, June 20, 2023 at 7:00 P.M., CT. SUBMISSION OF PROPOSALS Proposals may be: a) submitted to the office of Northland Securities, Inc., b) faxed to Northland Securities, Inc. at 612-851-591 8,c) emailedtoPublicSale@northlandsecurities.com d) for proposals submitted prior to the sale, the final price and coupon rates may be submitted to Northland Securities, Inc. by telephone at 612-851-5900 or 612-851-4968, ore) submitted electronically. Notice is hereby given that electronic proposals will be received via PARITY'", or its successor, in the manner described below, until 10:30 A.M., CT, on Tuesday, June 20, 2023.Proposals may be submitted electronically via PARITY'" or its successor, pursuant to this Notice until 10:30 A.M., CT, but no Proposal will be received after the time for receiving Proposals specified above. To the extent any instructions or directions set forth in PARITY'", or its successor, conflict with this Notice, the terms of this Notice shall control. For further information about PARITY'", or its successor, potential bidders may contact Northland Securities, Inc. or i-Deal@ at 1359 Broadway, 2nd floor, New York, NY 10018, telephone 212-849-5021. Neither the City nor Northland Securities, Inc. assumes any liability if there is a malfunction of PARITY'" or its successor. All bidders are advised that each Proposal shall be deemed to constitute a contract between the bidder and the City to purchase the Bonds regardless of the manner in which the Proposal is submitted. BOOK-ENTRY SYSTEM The Bonds will be issued by means of a book-entry system with no physical distribution of bond certificates made to the public. The Bonds will be issued in fully registered form and one bond certificate, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of Depository Trust Company ("DTC"), New York, New york, which will act as securities depository of the Bonds. * The city reserves the right to increase or decrease the principal amount of the Bonds. Any such increase or decrease will be made in multiples of $5,000 and may be made in any maturity. If any maturity is adjusted, thepurchase price will also be adjusted to maintain the same gross spread. 76905027v1 A-1 Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the City through Northland Trust Services, Inc., Minneapolis, Minnesota (the "Paying AgenVRegistrar"), to DTC, or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by pafticipants will be the responsibility of such participants and other nominees of beneficial owners. The successful bidder, as a condition of delivery of the Bonds, will be required to deposit the bond certificates with DTC. The City will pay reasonable and customary charges for the services of the Paying AgenVRegistrar. DATE OF ORIGINAL ISSUE OF BONDS Date of Delivery (Estimated to be July 19,2023) AUTHORITY/PURPOSE/SECURITY The Bonds are being issued pursuant to Minnesota Statutes, Chapters 429 and 475 and Sections 162.18 and 475.58, Sub. 3b. Proceeds will be used to finance the City's street improvement projects and to pay costs associated with the issuance of the Bonds. The Bonds are payable from municipal state aid revenues and special assessments levied against benefited property and additionally secured by ad valorem taxes on all taxable property within the City. The full faith and credit of the City is pledged to their payment and the City has validly obligated itself to levy ad valorem taxes in the event of any deficiency in the debt service account established for this issue. INTEREST PAYMENTS Interest is due semiannually on each June 15 and December 15, commencing June 15,2024, to registered owners of the Bonds appearing of record in the Bond Register as of the close of business on the first day (whether or not a business day) of the calendar month of such interest payment date. MATURITIES Principal is due annually on December 15, inclusive, in each of the years and amounts as follows: Year 2024 2025 2026 2027 2028 Amount $360,000 415,000 425,000 435,000 435,000 Year 2029 2030 2031 2032 2033 Amount $495,000 510,000 520,000 530,000 545,000 Proposals for the Bonds may contain a maturity schedule providing for any combination of serial bonds and term bonds, subject to mandatory redemption, so long as the amount of principal maturing or subject to mandatory redemption in each year conforms to the maturity schedule set forth above. INTEREST RATES All rates must be in integral multiples of 1l20th or l/8th of l%o. The rate for any maturity may not be more than 2.00% less than the ratefor any preceding maturity. All Bonds of the same maturity must bear a single uniform rate from date of issue to maturity. ESTABLISHMENT OF ISSUE PRICE A-2 76905027v1 (HOLD-THE-OFFERING-PRICE RULE MAY APPLY _ BIDS NOT CANCELLABLE) The winning bidder shall assist the City in establishing the issue price of the Bonds and shall execute and deliver to the City at closing an "issue price" or similar certificate setting forth the reasonably expected initial offering price to the public or the sales price or prices of the Bonds, together with the supporting pricing wires or equivalent communications, substantially in the form attached hereto as Exhibit A, with such modifications as may be appropriate or necessary, in the reasonable judgment of the winning bidder, the City and Bond Counsel. All actions to be taken by the City under this Notice of Sale to establish the issue price of the Bonds may be taken on behalf of the City by the City's Municipal Advisor and any notice or report to be provided to the City may be provided to the City's Municipal Advisor. The City intends that the provisions of Treasury Regulation Section 1 . 148- I (fX3 )(i) (defining "competitive sale" for purposes of establishing the issue price of the Bonds) will apply to the initial sale of the Bonds (the "competitive sale requirements") because: ( 1) the City shall disseminate this Notice of Sale to potential underwriters in a manner that is reasonably designed to reach potential underwriters; (2) all bidders shall have an equal opportunity to bid; (3) the City may receive bids from at least three underwriters of municipal bonds who have established industry reputations for underwriting new issuances of municipal bonds; and (4) the City anticipates awarding the sale of the Bonds to the bidder who submits a firm offer to purchase the Bonds at the highest price (or lowest cost), as set forth in this Notice of Sale Any bid submitted pursuant to this Notice of Sale shall be considered a firm offer for the purchase of the Bonds, as specified in the bid. In the event that the competitive sale requirements are not satisfied, the City shall promptly so advise the winning bidder. The City may then determine to treat the initial offering price to the public as of the award date of the Bonds as the issue price of each maturity by imposing on the winning bidder the Hold-the- Offering-Price Rule as described in the following paragraph (the "Hold-the-Offering-Price Rule"). Bids will not be subject to cancellation in the event that the City determines to apply the Hold-the-Offering- Price Rule to the Bonds. Bidders should prepare their bids on the assumption that the Bonds will be subject to the Hold-the-Offering-Price Rule in order to establish the issue price of the Bonds. By submitting a bid, the winning bidder shall (i) confirm that the underwriters have offered or will offer the Bonds to the public on or before the date of award at the offering price or prices (the "lnitial Offering Price"), or at the corresponding yield or yields, set forth in the bid submitted by the winning bidder and (ii) agree, on behalf of the underwriters participating in the purchase of the Bonds, that the underwriters will neither offer nor sell unsold Bonds of any maturity to which the Hold-the-Offering Price Rule shall apply to any person at a price that is higher than the Initial Offering Price to the public during the period starting on the award date for the Bonds and ending on the earlier of the following: (l) the close of the fifth (5th) business day after the award date; or (2) the date on which the underwriters have sold at least 10% of a maturity of the Bonds to the public at a price that is no higher than the Initial Offering Price to the public (the "100% Test"), at which time only that particular maturity will no longer be subject to the Hold-the-Offering-price Rule. The City acknowledges that, in making the representations set forth above, the winning bidder will rely on(i) the agreement of each underwriter to comply with the requirements for establishing issue price oithe Bonds, including, but not limited to, its agreement to comply with the Hold-the-Offering-price Rule, if applicable to the Bonds, as set forth in an agreement among underwriters and the related pricing wires, (ii; in the event a selling group has been created in connection with the initial sale of the gonAs tolhe public, the agreement of each dealer who is a member of the selling group to comply with the requirements foiestablishing issue price of the Bonds, including but not limitedio, iti agreement to comply with the Hold- A-3 76905027v1 the-Offering-Price Rule, if applicable to the Bonds, as set forth in a selling group agreement and the related pricing wires, and (iii) in the event that an underwriter or dealer who is a member of the selling group is a party to a third-party distribution agreement that was employed in connection with the initial sale of the Bonds to the public, the agreement of each broker-dealer that is a party to such agreement to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the Holdthe-Offering-Price Rule, if applicable to the Bonds, as set forth in the third-party distribution agreement and the related pricing wires. The City further acknowledges that each underwriter shall be solely liable for its failure to comply with its agreement regarding the requirements for establishing issue price of the Bonds, including but not limited to, its agreement to comply with the Hold-the-Offering- Price Rule, if applicable to the Bonds, and that no underwriter shall be liable for the failure of any other underwriter, or of any dealer who is a member of a selling group, or of any broker-dealer that is a party to a third-party distribution agreement to comply with its corresponding agreement to comply with the requirements for establishing issue price of the Bonds, including, but not limited to, its agreement to comply with the Holdthe-Offering-Price Rule if applicable to the Bonds. By submitting a bid, each bidder confirms that: (i) any agreement among underwriters, any selling group agreement and each third-parry distribution agreement (to which the bidder is a party) relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each underwriter, each dealer who is a member of the selling group, and each broker-dealer that is a party to such third-party distribution agreement, as applicable, (A) to comply with the Hold-the- Offering-Price Rule, if applicable if and for so long as directed by the winning bidder and as set forth in the related pricing wires, (B) to promptly notifo the winning bidder of any sales of Bonds that to its knowledge, are made to a purchaser who is a related parry to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below), and (C) to acknowledge that, unless otherwise advised by the underwriter, dealer or broker-dealer, the winning bidder shall assume that each order submitted by the underwriter, dealer or broker-dealer is a sale to the public, and (ii) any agreement among underwriters or selling group agreement relating to the initial sale of the Bonds to the public, together with the related pricing wires, contains or will contain language obligating each underwriter or dealer that is a parfy to a third-parfy distribution agreement to be employed in connection with the initial sale of the Bonds to the public to require each broker-dealer that is a party to such retail distribution agreement to comply with the Hold-the-Offering-Price Rule, if applicable, in each case if and for so long as directed by the winning bidder or the underwriter and as set forth in the related pricing wires.' Notes: Sales of any Bonds to any person thst is a related party to an underwriter participating in the initial sale of the Bonds to the public (each such term being used as defined below) shall not constitute soles to the publicfor purposes of this Notice of Sale. Further,for purposes of this Notice of Sale; (1) "public" means ony person other than an underwriter or a related party, (2) "underwriter" means (A) any person that agrees pursuant to a written contract with the City (or with the lead underwriter toform an underwriting syndicote) to participate in the initial sale of the Bonds to the public and (B) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (A) to participate in the initial sale of the Bonds to the public (including a member of a selling group or a party to a third-party distribution agreement participating in the initial sale of the Bonds to the public). (3) a purchaser of any of the Bonds is a "related party" to an underwriter if the underwriter and the purchaser are subject, directly or indirectly, to (A) more than 50% common ownership of the voting power or the total value of their stock, if both entities are corporations (including direct ownership by one corporation or another), (B) more than 50% common ownership of their capital interesis or profits interests, if both entities are partnerships (including direct ownership by one partnership of another), or (C) more than 5096 common ownership of the value of the outstanding stock of tie corporation or the capital interests or profit interests of the partnership, as opplicable, done entity is a corporation and the other entity is a partnership (including direct ownership of the applicable stock or interests by one entity of the other), and (4) "sale date" means the date that the Bonds are awarded by the City to the winning bidder. A-4 76905027v1 ADJUSTMBNS TO PRINCIPAL AMOUNT AFTER PROPOSALS The City reserves the right to increase or decrease the principal amount of the Bonds. Any such increase or decrease will be made in multiples of $5,000 and may be made in any maturity. If any maturity is adjusted, the purchase price will also be adjusted to maintain the same gross spread. Such adjustments shall be made promptly after the sale and prior to the award of Proposals by the City and shall be at the sole discretion of the City. The successful bidder may not withdraw or modif, its Proposal once submitted to the City for any reason, including post-sale adjustment. Any adjustment shall be conclusive and shall be binding upon the successful bidder. OPTIONAL RBDEMPTION Bonds maturing on December 15,2032 and 2033 are subject to redemption and prepayment at the option of the City on Decembe r 15,2031 and any date thereafter, at a price of par plus accrued interest. Redemption may be in whole or in part of the Bonds subject to prepayment. If redemption is in paft, the maturities and principal amounts within each maturity to be redeemed shall be determined by the City and if only part of the Bonds having a common maturity date are called for prepayment, the specific Bonds to be prepaid shall be chosen by lot by the Bond Registrar. CUSP NUMBERS If the Bonds qualify for assignment of CUSIP numbers such numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto shall constitute cause for a failure or refusal by the successful bidder thereofto accept delivery ofand pay for the Bonds in accordance with terms of the purchase contract. The CUSIP Service Bureau charge for the assignment of CUSIP identification numbers shall be paid by the successful bidder. DELIVERY Delivery of the Bonds will be within thirty-five days after award, subject to an approving legal opinion by Taft Stettinius & Hollister, LLP, Bond Counsel.. The legal opinion will be paid by the City and delivery will be anywhere in the continental United States without cost to the successful bidder at DTC. TYPE OF PROPOSAL Proposals of not less than $4,623,300 (99.00%) and accrued interest on the principal sum of $4,670,000 must be filed with the undersigned prior to the time of sale. Proposals must be unconditional except as to legality. Proposals for the Bonds should be delivered to Northland Securities, Inc. and addressed to: Cathy Erickson, Finance Director 4646Dakota Street SE. Prior Lake, Minnesota 55372 A good faith deposit (the "Deposit") in the amount of $93,400 in the form of a federal wire transfer (payable to the order of the City) is only required from the apparent winning bidder, and must be received within two hours after the time stated for the receipt of Proposals. The apparent winning bidder will receive notification of the wire instructions from the Municipal Advisor promptly after the *le. tf the Deposit is not received from the apparent winning bidder in the time allotted, the City may choose to rejeit their Proposal and then proceed to offer the Bonds to the next lowest bidder based on the terms of theii original proposal, so long as said bidder wires funds for the Deposit amount within fwo hours of said offer. 76905027v1 A-5 The City will retain the Deposit of the successful bidder, the amount of which will be deducted at settlement and no interest will accrue to the successful bidder. In the event the successful bidder fails to comply with the accepted Proposal, said amount will be retained by the City. No Proposal can be withdrawn after the time set for receiving Proposals unless the meeting of the City scheduled for award of the Bonds is adjourned, recessed, or continued to another date without award of the Bonds having been made. AWARD The Bonds will be awarded on the basis of the lowest interest rate to be determined on a true interest cost (TIC) basis. The City's computation of the interest rate of each Proposal, in accordance with customary practice, will be controlling. In the event of a tie, the sale of the Bonds will be awarded by lot. The City will reserve the right to: (i) waive non-substantive informalities of any Proposal or of matters relating to the receipt of Proposals and award of the Bonds, (ii) reject all Proposals without cause, and (iii) reject any Proposal which the City determines to have failed to comply with the terms herein. INFORMATION FROM SUCCESSFUL BIDDER The successful bidder will be required to provide, in a timely manner, certain information relating to the initial offering price of the Bonds necessary to compute the yield on the Bonds pursuant to the provisions of the Internal Revenue Code of 1986, as amended. OFFICIAL STATBMENT By awarding the Bonds to any underwriter or underwriting syndicate submitting a Proposal therefor, the Cify agrees that, no more than seven business days after the date of such award, it shall provide to the senior managing underwriter of the syndicate to which the Bonds are awarded, the Final Official Statement in an electronic format as prescribed by the Municipal Securities Rulemaking Board (MSRB). FULL CONTINUING DISCLOSURE UNDERTAKING The City will covenant in the resolution awarding the sale of the Bonds and in a Continuing Disclosure Undertaking to provide, or cause to be provided, annual financial information, including audited financial statements of the City, and notices of certain materialevents, as required by SEC Rule l5c2-12. BAI\K QUALIFICATION The City will designate the Bonds as qualified tax-exempt obligations for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended. BOND INSURANCE AT UNDERWRITER'S OPTION If the Bonds qualif, for issuance of any policy of municipal bond insurance or commitment therefor at the option ofthe successful bidder, the purchase ofany such insurance policy or the issuance ofany such commitment shall be at the sole option and expense of the successful bidder of the Bonds. Any increase in the costs ofissuance ofthe Bonds resulting from such purchase ofinsurance shall be paid by the successful bidder, except that, if the City has requested and received a rating on the Bonds from a rating agency, the City will pay that rating fee. Any other rating agency fees shall be the responsibility of the successful bidder. Failure of the municipal bond insurer to issue the policy after the Bonds have been awarded to the successful bidder shall not constitute cause for failure or refusal by the successful bidder to accept delivery on the Bonds. The City reseryes the right to reject any and all Proposals, to waive informalities and to adjourn the sale. 76905027v1 A-6 Dated: April 17,2023 Additional information may be obtained from: Northland Securities, lnc. 150 South 5'h Street, Suite 3300 Minneapolis, Minnesota 55402 Telephone No.: 612-85 1 -5900 BY ORDER OF THE PRIOR LAKE CITY COUNCIL lsl Cathy Erickson Finance Director 76905027v1 A-7 EXHIBIT A IFORM OF ISSUE PNCE CERTIFICATE - COMPETITIVE SALE SATISFIEDJ Theundersigned,onbehalfof(the',Underwriter''),hereby certifies as set forth below with respect to the sale of the General Obligation Bonds, Series 2023A (the "Bonds") of the City of Prior Lake, Minnesota (the "Issuer"). 1. ReasonablyExpectedlnitialOfferingPrice. (a) As of the Sale Date, the reasonably expected initialoffering prices of the Bonds to the Public by the Underwriter are the prices listed in Schedule A (the "Expected Offering Prices"). The Expected Offering Prices are the prices for the Maturities of the Bonds used by the Underwriter in formulating its bid to purchase the Bonds. Attached as Schedule B is a true and correct copy of the bid provided by the Underwriter to purchase the Bonds. (b) (c) 2. The Underwriter was not given the opportunity to review other bids prior to submitting its bid. The bid submitted by the Underwriter constituted a firm offer to purchase the Bonds. Defined Terms. (a) "Maturity" means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities. (b) "Public" means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (c) "Sale Date" means the first day on which there is a binding contract in writing for the sale of a Maturity of the Bonds. The Sale Date of the Bonds is (d) "Underwriter" means (i) any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a wriffen contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a member of a selling group or aparty to a retaildistribution agreement participating in the initial sale of the Bonds to the Public). The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents the Underwriter's interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to certain of the representations set forth in the Nonarbitrage Certificate and with respect to compliance with the federal income tax rules affecting the Bonds, and by Taft Stettinius & Hollister LLP, Bond Counsel in connection with rendering its opinion that the interest on the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Intemal Revenue Service Form 8038-G, and other federal income tax advice thai it may give to the Issuer from time to time relating to the Bonds. Dated: luly 19,2023. 76589026v1 A-8 [FORM OF ISSUE PNCE CERTIFICATE _ HOLD-THE-OFFENNG.PRICE RULE APPLIESJ The undersigned, on behalf of (the "U nderwriter"), on behalf of itself, hereby certifies as set forth below with respect to the sale and issuance of General Obligation Bonds, Series 2023A (the "Bonds") of the City of Prior Lake, Minnesota (the "Issuer"). l. Initial Offering Price of the Bonds. (a) The Underwriter offered each Maturity of the Bonds to the Public for purchase at the respective initial offering prices listed in Schedule A (the "Initial Offering Prices") on or before the Sale Date. A copy of the pricing wire or equivalent communication for the Bonds is attached to this certificate as Schedule B. (b) As set forth in the Notice of Sale and bid award, the Underwriter has agreed in writing that, (i) for each Maturity of the Bonds, it would neither offer nor sell any of the Bonds of such Maturity to any person at a price that is higher than the Initial Offering Price for such Maturity during the Holding Period for such Maturity (the "hold-the-offering-price rule"), and (ii) any selling group agreement shall contain the agreement of each dealer who is a member of the selling group, and any retail distribution agreement shall contain the agreement of each broker-dealer who is a party to the retail distribution agreement, to comply with the hold-the-offering-price rule. Pursuant to such agreement, no Underwriter (as defined below) has offered or sold any Maturity of the Bonds at a price that is higher than the respective Initial Offering Price for that Maturity of the Bonds during the Holding Period. 2. Defined Terms. (a) "Holding Period" means, for each Maturity of the Bonds, the period starting on the Sale Date and ending on the earlier of (i) the close of the fifth business day after the Sale Date or (ii) the date on which the Underwriter has sold at least l0% of such Maturity of the Bonds to the Public at prices that are no higher than the Initial Offering Price for such Maturity. (b) "Maturity" means Bonds with the same credit and payment terms. Bonds with different maturity dates, or Bonds with the same maturity date but different stated interest rates, are treated as separate Maturities. (c) "Public" means any person (including an individual, trust, estate, partnership, association, company, or corporation) other than an Underwriter or a related party to an Underwriter. The term "related party" for purposes of this certificate generally means any two or more persons who have greater than 50 percent common ownership, directly or indirectly. (d) "Sale Date" means the first day on which there is a binding contract in writing for the sale of a Maturity of the Bonds. The Sale Date of the Bonds is (e) "Underwriter" means (i) any person that agrees pursuant to a written contract with the Issuer (or with the lead underwriter to form an underwriting syndicate) to participate in the initial sale of the Bonds to the Public, and (ii) any person that agrees pursuant to a written contract directly or indirectly with a person described in clause (i) of this paragraph to participate in the initial sale of the Bonds to the Public (including a member of a selling group or aparty to a retail distribution agreement participating in the initial sale of the Bonds to the Public). The representations set forth in this certificate are limited to factual matters only. Nothing in this certificate represents the Representative's interpretation of any laws, including specifically Sections 103 and 148 of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations thereunder. The undersigned understands that the foregoing information will be relied upon by the Issuer with respect to ceftain of the representations set forth in the Nonarbitrage Certificate and with respect to compliance with the federal income tax rules affecting the Bonds, and by Taft Stettinius & Hollister LLP, Bond Counsel, in connection with rendering its opinion that the interest on 76589026v I A-9 the Bonds is excluded from gross income for federal income tax purposes, the preparation of the Internal Revenue Service Form 8038-G, and other federal income tax advice that it may give to the Issuer from time to time relating to the Bonds. Dated: July 19,2023 76589026v1 A- 10 FULL DISCLOSURE DISSEMINATION AGENT AGREEMENT DISSEMINATION AGENT AGREEMENT (the "Dissemination Agreement"), dated as of (the "Effective Date") by and between the City of Prior Lake,4646 Dakota Street Prior Lake, MN 55372 (the "Issuer") and Northland Securities, Inc., 150 South 5th Street, Suite 3300, Minneapolis, MN 55402 ("the Dissemination Agent") is in connection with bond issues of the Issuer for which the Issuer has entered into continuing disclosure agreements (the "Bond Issues"). The Issuer and the Dissemination Agent covenant and agree as follows with respect to the Bond Issues: SECTION 1. Definitions. The following capitalized terms shall have the following meanings: "Annual Report" shall mean the document or documents filed by the Dissemination Agent to the EMMA system pursuant to this Dissemination Agreement. "Arurual Report Data" shall mean the Issuer's audited financial statements, such other financial information and operating data for each Bond Issue as may be requested by the Dissemination Agent to compile the Annual Report, and information collected by the Dissemination Agent (such as data from the county auditor). "Continuing Disclosure Agreement" (the "CDA") shall mean that certain agreement, certificate, or undertaking executed by the Issuer at the time of issuance of its bonds. "Disclosure Representative" shall mean the Finance Director of the Issuer or his or her designee, or such other officer or employee as the Issuer shall designate in writing to the Dissemination Agent from time to time. "EMMA" shall mean the Electronic Municipal Market Access system which is maintained by the Municipal Securities Rulemaking Board. The Securities and Exchange Commission designates the EMMA system as the single centralized repository for the electronic collection and availability of continuing disclosure information about municipal securities. "Listed Events" shall mean any of the material events listed in Section 5(a) of this Dissemination Agreement. "Rule" shall mean Rule 15c2-12(bx5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "State" shall mean the State of Minnesota. City of Prior Lake, MN Page 1 4/10/2023 SECTION 2. Purpose of the Dissemination Agreement. This Dissemination Agreement is being entered into by the Issuer and the Dissemination Agent in order to assist the Issuer in complying with the Rule. SECTION 3. Duties of the Dissemination Asent and the Issuer (a) The Dissemination Agent shall: (i) review and catalog the existing and future CDAs of the Issuer; (ii) collect information from third parties and Issuer, as applicable, to the extent necessary to prepare the Annual Report; (iii) prepare the Annual Report for submission to the EMMA system in a format consistent with the Rule; (iv) submit the Annual Report and any additional items required by each CDA to the EMMA system by December 31 of each year, commencing Decembe r 31, 2023 ; (") file Listed Event notices to the EMMA system on behalf of the Issuer; ("i) deliver a copy of the Annual Report to the Issuer for its records; (vii) deem all information provided by the Issuer to be accurate, free of defect, as well as not containing any material misstatements, falsehoods or omissions of fact. (b) The Issuer shall: (0 provide the Dissemination Agent all documents and information deemed necessary to fulfill the Issuer's reporting requirements under each respective CDA within the following timeframes: a. provide notice within five (5) days of occurrence of any of the Listed Events; and b. provided all other disclosure information within fourteen (14) days of request from the Dissemination Agen! (ii) ensure all information provided by the Issuer for completion of the Annual Report or related to Listed Events is accurate and free of defect, as well as not containing any material misstatements, falsehoods, or omissions of fac! and (iii) acknowledge that the Dissemination Agent shall be entitled to rely on all information provided by the Issuer without further investigation as to its completeness or accuracy. (c) If for any reason the Issuer fails to provide the required information related to the Annual Report or the occurrence of any of the Listed Events, the Dissemination Agent shall not be held liable in the event that the necessary disclosure requirement was not disseminated to EMMA within the applicable timeframe. If for any reason the Issuer fails to provide the required information related to the Annual Report or the occurrence of any of the Listed Events and the Issuer's delay results in any disclosure filing being after a stated deadline, the Dissemination Agent shall, without further direction or instruction from the Issuer, file a notice(s) with the applicable recipient with information provided by the Issuer, if any, andf or describing the failure and providing any other information the Dissemination Agent deems appropriate. City of Prior Lake, MN Page2 4/10/2023 SECTION 4. Content of Annual Reports. The Annual Report, prepared with the assistance of the Dissemination Agent for each Bond Issue, shall contain or incorporate by reference the financial information and operating data specified in the applicable CDA or continuing disclosure provisions of any applicable Resolution, Indenture, Loan Agreement or Lease Agreement. SECTION 5. Reporting of Material Events. (a) The following Listed Events are specified in the Rule and in the CDAs of the Issuer. Notice of the occurrence of any of the Listed Events or those listed in the Issuer's CDAs or in any applicable Resolution, Indenture, Loan Agreement or Lease Agreement, shall be filed within 10 days of occurrence: Principal and interest payment delinquencies; Non-payment related defaults, if material; Unscheduled draws on debt service reserves reflecting financial difficulties; Unscheduled draws on credit enhancements reflecting financial difficulties; Substitution of credit or liquidity providers, or their failure to perform; Adverse tax opinions, the issuance by the Intemal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701- TEB) or other material notices or determinations with respect to the tax status of the security, or other material events affecting the tax stafus of the security; Modifications to rights of security holders, if material; Bond calls, if material, and tender offers; Defeasances; Release, substifution, or sale of property securing repayment of the securities, if material; Rating changes; Bankruptcy, insolvency, receivership or similar event of the obligated person; The consummation of a merger, consolidation, or acquisition involving an obligated Person or the sale of all or substantially all of the assets of the obligated Person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material; 1,. 2. J. 4. 5. 6. 7. 8. 9. 10. 11,. 12. 13. City of Prior Lake, MN Page 3 4/10/2023 Appointrnent of a successor or additional trustee or the change of name of a trustee, if material; 15 The incurrence of a Financial Obligation of the Issuer, if material, or agreement to covenants, events of default, remedies, priority rights, or other terms of a Financial Obligation of the Issuer, any of which affect security holders, if material; and 1,6.Default, event of acceleration, termination event modification of terms, or other similar events under the terms of a Financial Obligation of the Issuer, any of which reflect financial difficulties. SECTION 6. Compensation and Terms. (a) The Issuer has engaged the Dissemination Agent to assist it in carrying out its obligations under this Dissemination Agreement. For its services hereunder, the Dissemination Agent shall be paid arurually a fee equal to: (0 $1,250 base fee; plus (ii) $250 per Bond Issue for each Bond Issue for which an Annual Report is required by the Rule to be filed. This fee shall encompass all duties of the Dissemination Agent listed under Section 3. For reporting years for which the Issuer has prepared an Official Statement for a new issue of bonds and said Official Statement can be used to partially satisfy reporting requirements, the annual fee shall be 50% of the annual fee quoted above. The annual fee shall have a cap at a maximum amount not to exceed $3,000 per year. In addition, the Issuer shall reimburse the Dissemination Agent for any out-of- pocket expenses incurred in preparing the Annual Report. (b) Fees quoted herein shall be firm for two (2) years from the Effective Date. After the initial two (2) year term, Northland may, at its discretion, adjust recurring fees under this Agreement by providing written notice of not less than ninety (90) days to the Issuer. The Issuer may terminate this Agreement within ninety (90) days of the date of such notice by providing written notice to the Dissemination Agent. If the Issuer fails to terminate the Agreement within the allotted time, then the Issuer shall be deemed to have agreed to the fee adjushnent. (c) The Issuer may discharge any such Dissemination Agent with or without appointing a successor or Dissemination Agent. Additionally, this Dissemination Agreement may be terminated by either party for any reason upon thirty (30) days written notice to the other party. A termination of this agreement shall not relieve the Issuer of its obligation to pay the Dissemination Agent for all services rendered and all reimbursable expenses incurred prior to the effective date of termination. SECTION 7. Amendment, Waiver. Notwithstanding any other provision of this Dissemination Agreement the Issuer and the Dissemination Agent may amend this Dissemination Agreement, and any provision of this Dissemination Agreement may be waived, in writing, as agreed to by the parties thereto. SECTION 8. Additional Information. Nothing in this Dissemination Agreement shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Dissemination Agreement or any other means of communication. '1.4 City of Prior Lake, MN Page4 4/10/2023 SECTION 9. Duties. Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Dissemination Agreement and the Issuer shall indemnify, hold harmless and defend the Dissemination Agent from and against any damages, costs or other liabilities (including reasonable attorneys' fees) arising from or relating to any breach of this Dissemination Agreement by the Issuer, including, but not limited to, damages, costs and other liabilities arising out of any information received from the Issuer and disseminated by the Dissemination Agent. Further, in no event shall the Dissemination Agent's total aggregate liability under this Dissemination Agreement be in excess of the amount of the annual fee paid by the Issuer to the Dissemination Agent. In addition, the Issuer acknowledges that the Dissemination Agent shall not be responsible and/or liable for any errors/ misstatements or omissions associated with any continuing disclosure report or filing, or for the correction thereof, that was prepared or disseminated by any party other than the Dissemination Agent. SECTION L0. Beneficiaries. This Dissemination Agreement shall inure solely to the benefit of the Issuer and the Dissemination Agent and shall create no rights in any other person or entity. SECTION 11. Counterparts, This Dissemination Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. CITY OF PRIOR LAKE, MINNESOTA NORTHLAND SECURITIES, INC 6'ufu*ByBy Its Finance Manager City of Prior Lake, MN Page 5 4/10/2023 IN WITNESS WHEREOF, thE CITY OF PRIOR LAKE and NORTHLAND SECURITIES, INC. have caused this Dissemination Agreement to be executed in their respective nameq all as of the date first written above.