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HomeMy WebLinkAbout970 - REGARDING the proposed City of Boulder Water & Sewer Revenue Refunding Bonds Series 2005A & 20RESOLUTION NO. 9 ~ ~ A RESOLUTION CONCERNING THE PROPOSED CITY OF BOULDER, COLORADO (ACTING THROUGH ITS WATER UTILITY ENTERPRISE AND ITS WASTEWATER UTILITY ENTERPRISE), WATER AND SEWER REVENUE REFiJNDING BONDS, SERIES 2005A AND SERIES 2005B IN THE AGGREGATE PRINCII'AL AMOUNT OF NOT TO EXCEED $10,000,000; AUTHORIZING THE OFFICIAL NOTICE OF BOND SALE WITH RESPECT TO SAID BONDS; PRESCRIBING CERTAIN DETAILS CONCERNING SAID PROPOSED SALE AND SAID BONDS; APPROVING THE FORM OF A PRELIMINARY OFFICIAL STATEMENT; AND PROVIDING THE EFFECTIVE DATE OF THIS RESOLUTION. WHEREAS, the City of Boulder, Colorado, in the County of Boulder and State of Colorado (the "City"), is a municipal corporation duly organized and existing as a home rule city pursuant to Article XX of the Constitution of the State of Colorado (the "Constitution") and the home rule charter of the City (the "Charter"); and WHEREAS, Article X, Section 20 of the Constitution ("Amendment One") requires that bonded debt (other than certain refunded debt) not be issued without prior voter approval unless the issuer is an "Enterprise" as defined in Amendment One; and WHEREAS, Ordinance No. 5601, introduced, read, passed and adopted on the 9th day of November 1993, added new sections 11-1-55 to -61 to the Boulder Revised Code, 1981 (the "City Code") providing for the establishment of the City's water system as a"water activity enterprise" within the meaning of Part 1 of Article 45.1 of Title 37, Colorado Revised Statutes, as amended, and naming the City's water system the "Water Utility Enterprise"; and WHEREAS, Ordinance No. 5601 also added new sections 11-2-36 to -42 to the City Code, providing for the establishment of the City's sanitary sewer system as a"water activity enterprise" within the meaning of Part 1 of Article 45.1 of Title 37, Colorado Revised Statutes, as amended, and naming the City's sanitary sewer system the "Wastewater Utility Enterprise"; and WHEREAS, pursuant to the Charter and the City Code, the City Council of the City (the "Council") is the governing body of the Water Utility Enterprise and the Wastewater Utility Enterprise and the Council need not announce or acknowledge that actions taken by the Council are taken by the governing body of the Water Utility Enterprise and/or the Wastewater Utility Enterprise; and WHEREAS, pursuant to the Charter and the City Code, the Water Utility Enterprise and the Wastewater Utility Enterprise may issue revenue bonds payable from revenues derived from the operation of such Enterprise without voter approval so long as such Enterprise qualifies as an `Bnterprise" within the meaning of Amendment One in the City's fiscal year of the issuance of such revenue bonds; and WHEREAS, the Water Utility Enterprise and the Wastewater Utility Enterprise are "Enterprises" within the meaning of Amendment One; and 02-132471.2 WHEREAS, the Council deems it advisable and necessary to issue revenue bonds of the City in an aggregate principal amount of not to exceed $10,000,000 designated Water and Sewer Revenue Refunding Bonds, Series 2005A and Series 2005B (together, the "Bonds") to provide funds with which to (a) current refund the City of Boulder, Colorado, Water and Sewer Revenue Bonds, Series 1992 (the "1992 Refunded Bonds"); (b) advance refund the City of Boulder, Colorado Water and Sewer Revenue Bonds, Series 1996 (the "1996 Refunded Bonds); (c) to fund reserve funds for the 2005 Bonds; and (d) to pay necessary incidental and appurtenant expenses in connection therewith, including the cost of issuance of the 2005 Bonds; and NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BOULDER THAT: Section 1. The Bonds shall be, and the same hereby are ordered to be, publicly sold, and the Council shall cause electronic bid proposals to be received and to be opened publicly for the purchase of the Bonds on May 3, 2005 at 10:00 a.m. unless the City Manager of the City (the "City Manager") determines to change the public sale date. In the event the public sale date is changed, the City Manager shall notify the Director of Finance and Record of the City (the "Director of Finance and Record") as to the date, hour and place that such electronic bid proposals shall be received and opened. The City shall indicate in the notice hereinafter described the date, the hour and the place that such electronic bid proposals shall be received and opened. Section 2. The Mayor of the City (the "Mayor") and the Director of Finance and Record together aze hereby authorized and directed to provide for the publication of the Official Notice of Bond Sale in the (Boulder) Daily Camera at such times as they deem adequate to give reasonable notice of the proposed sale, but no less than once after the date hereof and at least five days prior to the public sale date. The Official Notice of Bond Sale shall be in substantially the following form, with such changes therein, including but not limited to changes in dates, principal amounts and maturities and completions thereto, as shall be deemed to be in the best interest and to the best advantage of the City, the execution of such notice by the Mayor and the Director of Finance and Record to indicate conclusively the Council's approval of any and all such changes for purposes of this Resolution: [Form of Official Notice of Bond Sale] 02-132471.2 2 OFFICIAL NOTICE OF BOND SALE $1,110,000' CITY OF BOULDER, COLORADO (Acting through its Water U61ity Enterprise and its Wastewater Utility Enterprise) WATER AND SEWER REVENUE REFUNDING BONDS SERIES 2005A $7,940,000' CITY OF BOULDER, COLORADO (AMiog through its Water Utility Enterprise and its Wastewater Utility Enterprise) WATER AND SEWER REVENUE REFUNDING BONDS SERIES 20056 (Payable solely from certain net income of the municipal water system and municipal sanitary sewer system.) PUBLIC NOTICE IS HEREBY GIVEN that proposals will be received by the City Council of the City of Boulder (the "Council" and "City," respectively), in the County of Boulder and State of Colorado for the purchase of $1,110,000 original principal amount of its "Water and Sewer Revenue Refunding Bonds, Series 2005A" (the "Series 2005A Bonds") and $7,940,000 original principal amount of its "Water and Sewer Revenue Refunding Bonds, Series 20056" (the "Series 20056 Bonds" and together with the Series 2005A Bonds, the "Bonds"). Proposals for the purchase of such Bonds will be accepted through the receipt of bids through the use of an electronic bidding system. The bids will be received at the place and up to the time specified below: Date and Time: Tuesday, May 3, 2005 10:00 a.m. (Colorado Time) Submission of Electronic Bids: Electronic proposals shall be submitted through BIDCOMP/PARITY~' (the "Approved Provider"). Neither the Authority, Piper Jaffray & Co. (the "Financial Advisor") nor Kutak Rock LLP ("Bond Counsel") shall be responsible for, and each bidder expressly assumes the risk of, any incomplete, inaccurate or untimely bid submitted through the Approved Provider by such bidder, including, without limitation, by reason of faulty transmissions, mechanical failure, engaged telephone or telecommunications lines or any other cause arising from the delivery of bids through the Approved Provider. See "TERMS OF SALE- Information Regazding Electronic Proposals" herein. ` Subject to adjustment as set forth herein. oz-13za~t.z 3 Delivery Date of Bonds: The Bonds will be delivered on June 7, 2005. See "TERMS OF SALE-Manner and Time of Delivery." All electronic proposals shall be deemed to incorporate the provisions of the Official Bid Form. See instructions under "TERMS OF SALE-Form of Bid; Interest Rates and Limitations," below. BOND PROVISIONS Issue The City (acting through its Water Utility Enterprise and its Wastewater Utility Enterprise) will issue the Bonds pursuant to an ordinance to be adopted by the City (the "Ordinance"). Form, Dates and Maturities The Bonds subject to this Official Notice of Bond Sale will be issued as fully registered bonds and shall be executed and delivered only in global book-entry form registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), New York, New York, acting as securities depository of the Bonds. The Bonds maybe purchased in the denominations of $5,000 and any integral multiples thereof. The Bonds will be dated May 1, 2005. Interest will be payable on each June 1 and December 1, commencing December 1, 2005. The Bonds will mature on December 1 in each of the designated amounts and years as follows: Series 2005A Bonds Date Maturing Amounts (December 1) Maturing* 2005 $65,000 2006 135,000 2007 140,000 2008 145,000 2009 150,000 2010 150,000 2011 155,000 2012 170,000 *Estimate; subject to change; see "TERMS OF SALE-Adjustment of Principal Amount." 02-132471.2 Series 2005B Bonds Date Maturing Amounts (December 1) Maturing* 2005 $255,000 2006 590,000 2007 610,000 2008 625,000 2009 645,000 2010 665,000 2011 690,000 2012 715,000 2013 740,000 2014 770,000 2015 800,000 2016 835,000 *Estimate; subject to change; see "TERMS OF SALE-Adjustment of Principal Amount." Book-Entry The City, after consultation with its financial advisor, will make arrangements for custodial deposit of the Bonds with DTC, New York, New York. The Bonds will therefore be registered in the name of Cede & Co., as nominee of DTC, which will act as securities depository for the Bonds. Ownership interest in the Bonds will be transferred only pursuant to the "Book-Entry Only System" of DTC in a denomination of $5,000 or any integral multiple thereof. After the initial deposit of the Bonds with DTC, they may not be removed from such custodial deposit, transferred or exchanged except as provided in the Ordinance. Interest Rates and Limitations (a) It is permissible to bid different or "split" interest rates for the Bonds; provided, however, that only one interest rate shall be specified for any maturity of the Bonds. (b) Each rate stated must be in a multiple ofone-eighth (1/8) or one-twentieth (1/20) of one percent (1%) per annum. (c) The maximum interest rate named for any Bond shall not exceed the minimum interest rate named for any other Bond by more than 3.50% per annum. (d) A zero rate of interest may not be designated. (e) Each Bond shall beaz interest from its date to its stated maturity at the interest rate stated in the bid. (f) Bids may not provide for supplemental or "B" coupons or interest rates. 02-132471.2 (g) Bidders must only bid on both the Series 2005A and the Series 2005B Bonds together and may not bid on only the Series 2005A Bonds or the Series 2005B Bonds separately. Purpose of Issue The Bonds are authorized to be issued for the purposes of providing funds with which to (a) current refund the City of Boulder, Colorado, Water and Sewer Revenue Bonds, Series 1992 (the "1992 Refunded Bonds"); (b) advance refund the City of Boulder, Colorado, Water and Sewer Revenue Bonds, Series 1996 (the "1996 Refunded Bonds" and together with the 1992 Refunded Bonds, the "Refunded Bonds"); (c) fund reserve funds for the Bonds; and (d) pay necessary incidental and appurtenant expenses in connection therewith, including the cost of issuance of the 2005A Bonds. Redemption Optional Redemption. The Bonds are not subject to optional redemption. Term Bonds; Mandatory Sinking Fund Redemption. A bidder may request that Series 2005B Bonds maturing on and after December 1, 2014 be included in one term Series 2005B Bonds. Amounts included in a single term Series 2005B Bond must consist of consecutive maturities of Series 2005B Bonds and must bear the same rate of interest. Any such term Series 2005B Bond will be subject to mandatory sinking fund redemption in the same amounts and on the same dates as the Series 2005B Bonds would have matured if they were not included in a term Series 2005B Bond. Series 2005B Bonds redeemed pursuant to mandatory sinking fund redemption will be redeemed at a redemption price equal to the par amount of such Series 2005B Bonds plus accrued interest to the redemption date in the manner as otherwise provided in the Ordinance. Any election to designate Series 2005B Bonds as being included in a term Series 2005B Bond must be made in the Official Bid Form available from the City. See "TERMS OF SALE-Bid Proposals." Place of Payment Principal of and premium, if any, on the Bonds will be payable to the registered owner (Cede & Co.) upon presentation and surrender of the Bonds at the office of U.S. Bank National Association, at its operations center in St. Paul, Minnesota, as paying agent, or its successor or assignee (the "Paying Agent"). Interest on the Bonds will be payable by check or draft of the Paying Agent mailed or forwarded by wire transfer on the interest payment date to the registered owner thereof (Cede & Co.) as of the close of business on the Record Date (the 15th day of the month prior to each interest payment date on the Bonds, whether or not a business day). All payments of the principal of, premium if any, and interest on the Bonds shall be made in lawful money of the United States of America. Security The Bonds will be payable from, and will constitute a first and prior (but not exclusive) lien on, the Net Income of the municipal water system and the sanitary sewer system and moneys on deposit in the 2005A Bond Fund, 2005B Bond Fund, the 2005A Reserve Fund and the 2005B Reserve Fund established by the Ordinance. Net Income of the municipal water system and 02-132471.2 6 sanitary sewer system means the gross income derived from the operation and use of the water system and the sanitary sewer system as may be designated after the deduction of the operation and maintenance expenses as more fully described in the Official Statement prepared by the City with respect to the Bonds. Additional Bonds The Ordinance will permit the issuance of additional bonds of the City, payable from a lien on the Net Income on a parity with, or subordinate to, the lien thereof of the Bonds. Upon the issuance of the Bonds and the refunding of the Refunded Bonds, there will be $[13,075,000] City of Boulder, Colorado (Acting through its Water Utility Enterprise and its Wastewater Utility Enterprise), Water and Sewer Revenue Bonds, Series 1999, $19,720,000 City of Boulder, Colorado (Acting through its Water Utility Enterprise and its Wastewater Utility Enterprise), Water and Sewer Revenue Bonds, Series 2000 and $25,870,000 City of Boulder, Colorado (Acting through its Water Utility Enterprise and its Wastewater Utility Enterprise), Water and Sewer Revenue Bonds, Series 2001, outstanding payable from the Net Income on a parity with the Bonds. Authorization The Bonds are authorized to be issued by the Constitution of the State of Colorado, the Charter of the City, the laws of the State of Colorado, the ordinance of the City establishing the systems as "Enterprises" and the Ordinance. TERMS OF SALE Form of Bid; Interest Rates and Limitations. Any bidder is required to submit an unconditional and written bid for the entire issue of the Bonds, specifying the interest rate or rates and specifying the price at which the bidder will purchase the Bonds, which price shall be at or above paz plus accrued interest. Bidders must submit their bids through electronic means as provided in this Notice of Sale. All electronic proposals shall be deemed to incorporate the provisions of the Official Bid Form. Information Regarding Electronic Proposals. Electronic proposals must be submitted through BIDCOMP/PARITY~' (the "Approved Provider") in accordance with this Notice of Sale. If any provisions in this Notice of Sale conflict with information provided by the Approved Provider, this Notice of Sale shall control. The City is not responsible for proper operation of nor has any liability for any delays or interruptions of or any damages caused by the Approved Provider. The City is using the Approved Provider as a communications mechanism and not as the City's agent to conduct electronic bidding for the Bonds. The City is not bound by any advice and determination of the Approved Provider to the effect that any particular bid complies with the terms of this Notice of Sale. All costs and expenses incurred by prospective bidders in connection with their submission of bids through the Approved Provider aze the sole responsibility of the bidders, and the City is not responsible for any of such costs or expenses. Further information about the Approved Provider, including any fee charged, may be obtained from i-Deal, LLC at 395 Hudson Street, 02-132471 2 7 New York, New York 10014 (212-806-8304). The City does not assume any responsibility or liability for bids submitted through the Approved Provider. The City may regard the electronic submission of a bid through the Approved Provider (including information about the purchase price for the Bonds and interest rate to be borne by the various maturities of the Bonds and any other information included in such transmission) as though the same information were submitted by the bidder on the Bid Form and executed on the bidder's behalf by a duly authorized signatory. If such bid is accepted by the City, this Notice of Sale, the Bid Form and the information that is electronically transmitted through the Approved Provider shall form a contract and the successful bidder shall be bound by the terms of such contract. Good Faith Deposit A good faith deposit (the "Deposit") in the form of a certified or cashier's check or a financial surety bond (the "Financial Surety Bond") in the amount of $180,000, payable to the order of the City of Boulder, Colorado, is required for each bid to be considered. If a check is used, it must accompany each bid. If a Financial Surety Bond is used, it must be from an insurance company licensed to issue such a bond in the State of Colorado, and such bond must be submitted to the City or its financial advisor prior to the opening of the bids. The Financial Surety Bond must identify each bidder whose Deposit is guaranteed by such Financial Surety Bond. If the Bonds are awarded to a bidder utilizing a Financial Surety Bond, then that purchaser (the "Purchaser") is required to submit its Deposit to the City or its financial advisor in the form of a cashier's check (or wire transfer such amount as instructed by the City or its financial advisor) not later than 3:30 p.m. M.S.T. on the next business day following the award. If such Deposit is not received by that time, the Financial Surety Bond maybe drawn by the City to satisfy the Deposit requirement. No interest on the Deposit will accrue to the Purchaser. The Deposit of the Purchaser will either be applied to the purchase price of the Bonds or returned to the Purchaser on the closing date upon payment of the full purchase price of the Bonds. In the event the Purchaser fails to honor its accepted bid, the Deposit will be retained by the City. Deposits of all bidders other than the Purchaser shall be promptly returned to each such bidder. Tax Status Kutak Rock LLP, Denver, Colorado, bond counsel, will opine that, under existing laws, regulations, rulings and judicial decisions, the interest on the Bonds (a) is not includible in gross income for federal income tax purposes and is not includible in gross income for Colorado income tax purposes, (b) is not includible in alternative minimum taxable income for the purpose of the Colorado alternative minimum tax and (c) is not a specific preference item for purposes of the altemative minimum tax provisions contained in,the Internal Revenue Code of 1986, as amended (the "Code"); however, such opinion will also state that interest on the Bonds will be included in the adjusted current earnings of certain corporations, and such corporations are required to include in the calculation of altemative minimum taxable income 75% of the excess of each such corporation's adjusted current earnings over its alternative minimum taxable income (determined without regard to this adjustment and prior to reduction for certain net operating losses) and that the opinion described in clause (a) above is subject to continuing compliance by the City with the covenants regarding federal tax law contained in the Ordinance 02-132471.2 8 authorizing the Bonds and that failure to comply with such covenants could cause interest on the Bonds to be so included in federal and Colorado gross income retroactive to the date of issue of the Bonds. Bond counsel's opinion will also state that the accrual or receipt of interest on the Bonds may otherwise affect the federal income tax liability of the recipient and that the extent of these other tax consequences will depend upon the recipient's particular tax status or other items of income or deduction. If, prior to the delivery of the Bonds to the successful bidder therefor, the income received by private owners of obligations of the same type and chazacter as the Bonds shall be includible in gross income for federal or State of Colorado purposes, the successful bidder, at its election made prior to the tender by the City of the Bonds for delivery, may be relieved of any obligation under the contract to purchase the Bonds. In such case, the contract to purchase the Bonds shall terminate, and the deposit accompanying the purchaser's bid will be returned to the purchaser upon written request therefor. Any such option shall be exercised by a letter addressed to the Director of Finance and Record and bond counsel, and deposited in the United States mails, asfirst-class mail, postage prepaid. Sale Reservations The City reserves the privilege o£ (a) waiving any irregularity or informality in any bid; (b) rejecting any and all bids for the Bonds; and (c) reoffering the Bonds for sale in any manner permitted by law. Adjustment of Principal Amount Upon acceptance of bids, the Council, after consultation with its Financial Advisor, shall determine the amount of the 2005A Minimum Bond Reserve (as defined in the Ordinance) to be deposited to the 2005A Reserve Fund and compute the yield restriction applicable to the escrow for the 1992 Refunded Bonds (the "1992 Escrow Fund"), and shall determine the composition of the 1992 Escrow Fund (which shall be invested in United States Treasury Obligations). To the extent premium is received by the winning bidder and to the extent more or less 2005A Bond proceeds are required to fund the 2005A Reserve Fund and establish such 1992 Escrow Fund, the principal amount of the 2005A Bonds shall be adjusted upwazd or downwazd as the City shall in its discretion determine. Such adjustment shall not exceed $25,000 for any one year and shall not exceed $150,000 in total principal amount. Upon acceptance of bids, the Council, after consultation with its Financial Advisor, shall determine the amount of the 2005B Minimum Bond Reserve (as defined in the Ordinance) to be deposited to the 2005B Reserve Fund and compute the yield restriction applicable to the escrow for the 1996 Refunded Bonds (the 1996 Escrow Fund"), and shall determine the composition of the 1996 Escrow Fund (which shall be invested in United States Treasury Obligations). To the extent premium is received by the winning bidder and to the extent more or less 2005B Bond proceeds are required to fund the 2005B Reserve Fund and establish such 1996 Escrow Fund, the principal amount of the 2005B Bonds shall be adjusted upward or downwazd as the City shall in its discretion determine. Such adjustment shall not exceed $35,000 for any one year and shall not exceed $450,000 in total principal amount. 02-132471.2 9 Further, the City reserves the discretion, notwithstanding the foregoing, to vary the principal amount of Bonds in excess of the pazameters set forth above if the City deems it necessary to fund such reserves or accomplish such refundings, and notice thereof will be given over the Munifacts Wire Service prior to the time bids are to be received. Basis of Award The Bonds, subject to such sale reservations, shall be sold to the responsible bidder making the best bid for the Bonds to the best advantage of the City. The best bid shall be determined by computing the actuarial yield on the Bonds (i.e., using an actuarial or True Interest Cost method) for each bid received, and an award will be made (if any is made) to the responsible bidder submitting the bid that results in the lowest actuarial yield on the Bonds. "Actuarial yield" on the Bonds as used herein means that yield which, if used to compute the present worth as of the date of the Bonds (i.e., May 1, 2005) of all payments of principal and interest to be made on the Bonds from their date to their respective maturity dates (including mandatory sinking fund redemption dates) using the interest rates specified in the bid, produces an amount equal to the aggregate principal amount of the Bonds plus any premium bid. No adjustment shall be made in such calculation for accrued interest on the Bonds from their date to the date of delivery thereof. Such calculation shall be based on a 360-day year and a semiannual compounding interval. If there aze two or more equal bids for the Bonds and such equal bids are the best bids received, the Council shall determine in its discretion which bid will be accepted. No Sale Below Par or Discount or Commission The Bonds shall not be sold by the City at less than their principal amount and accrued interest thereon to the date of their delivery, nor will any discount or commission be allowed or paid on the sale of the Bonds; provided that the foregoing provision shall not preclude original issue discount so long as the total purchase price paid by the Purchaser to the City is at least equal to the par amount of the Bonds plus accrued interest. Time of Award The City shall open the bids at such time as hereinabove specified. It intends to take action upon determining the best bid and to award the Bonds or reject all bids for the Bonds by action of the Council at a meeting to be held not later than 24 hours after the expiration of the time for opening bids. Offering Price and Yie-ds On the date herein stated for opening bids, the successful bidder shall notify the Director of Finance and Record in writing o£ (a) the initial offering price of the Bonds to the public (excluding bond brokers and other intermediaries) at which a substantial portion of the Bonds of each maturity are sold; and (b) the initial offering yield to maturity for each maturity of the Bonds in a stated percentage for the Council's use in making any necessary azbitrage bond 02-132471.2 10 investment yield calculations for federal income tax purposes. hi addition, prior to delivery of the Bonds the successful bidder will be required to sign and deliver an exhibit to the no arbitrage certificate of the City with respect to the public offering price and yield of the Bonds in form and substance required by bond counsel. Manner and Time of Delivery The deposit of the successful bidder shall be credited to the purchaser at the time of delivery of the Bonds (without accruing interest). If the successful bidder for the Bonds fails or neglects to complete the purchase of the Bonds on the date the Bonds aze made ready and are tendered by the City for delivery, the amount of this deposit shall be forfeited (as liquidated damages for noncompliance with the bid) to the City, except as hereinafter provided. In that event, the City may reoffer the Bonds for sale. The purchaser shall not be required to accept delivery of any of the Bonds if they aze not tendered for delivery within 60 days from the date herein stated for opening bids, and, if the Bonds aze not so tendered within said period of time, the good faith deposit shall be returned to the purchaser upon its request. Unless the City shall otherwise notify the purchaser, the Bonds will be tendered to the purchaser for delivery on June 7, 2005. Payment and Place of Delivery The successful bidder shall be required to make payment of the balance due for the Bonds by wire transfer in immediately available funds to an account designated by the City. Such balance of the purchase price, including any premium, must be paid in such immediately available funds and not by any waiver of interest, nor by any other concession as a substitution for such immediately available funds. The successful bidder shall be required to accept delivery of the Bonds at the office of DTC in New York, New York. CUSIP Numbers CUSIP numbers shall be printed on the Bonds at the expense of the City. If an incorrect number is imprinted on any Bond or if a number is not printed thereon, any such error or omission shall not constitute cause for the successful bidder to refuse delivery of any Bond. Legal Opinion, Bonds and Transcript The legality of the Bond issue will be approved by the firm of Kutak Rock LLP, 1801 California Street, Suite 3100, Denver, Colorado 80202, whose unqualified approving opinion, together with the Bonds, a certified transcript of the proceedings, including a certificate stating that there is no litigation pending affecting the validity of the Bonds as of the date of their delivery, and other closing documents, will be furnished to the purchaser without charge by the City. A certified true copy of the approving opinion of bond counsel for the issue will be printed on each Bond at the City's expense. The City will deliver to the successful bidder at closing a certificate stating that to the best of its knowledge, the information included in the Official Statement does not contain any untrue statement of a material fact and does not omit to state a material fact necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. 02-132471.2 11 Financial Advisor Piper Jaffray & Co. is acting as financial advisor to the City in connection with the issuance of the Bonds. Pursuant to its contract with the City, it is required to submit a bid to purchase the Bonds. Rule ISc2-12 Compliance The City covenants and agrees to enter into a written agreement or contract, constituting an undertaking to provide ongoing disclosure about the City, for the benefit of the owners of the Bonds on or before the date of delivery of the Bonds as required by Section (b)(5) of Securities and Exchange Commission Rule 15c2-12 (17 CFR § 240.15c2-12) (the "Rule"), which undertaking shall be a part of the Ordinance and in the form summarized in the Preliminary Official Statement. The form of the Preliminary Official Statement has been approved by the Council. The City has not previously failed to supply any annual financial information as required. The Preliminary Official Statement which will be delivered pursuant to the sale of the Bonds is, except for Permitted Omissions (as defined below), final as of its date, within the meaning of the Rule, and the information therein is accurate and complete except for the Permitted Omissions. "Permitted Omissions" shall mean the offering prices, interest rates, selling compensation, delivery date, ratings, any other terms required by the City to be specified in the competitive bid, the identify of the underwriters and other terms of the Bonds depending on such matters, all with respect to the Bonds. To enable the successful bidder to comply with the Rule, after the awazd of the Bonds and within seven business days following receipt by the City of written advice from the successful bidder of the full name or names of the successful bidder (if the same cannot be readily ascertained from the Official Bid Form submitted thereby), the offering prices of the Bonds and the amount of selling compensation realized, the City will furnish thereto, in reasonable quantities as requested, copies of a final Official Statement. Failure by the successful bidder to provide (or delay by the successful bidder in providing) such information will prevent the City from famishing such Official Statement as described above, and the City shall not be responsible or liable in any manner for the accuracy of the information provided by the successful bidder or failure to furnish such Official Statement as described above which results from a failure by the successful bidder to provide the aforementioned information within the time specified. Information This Official Notice of Bond Sale, and a Preliminary Official Statement relating to the Bonds, may be obtained from Ms. Kathleen Simson Love, Office of the Director of Finance and Record, City of Boulder, Municipal Building, 1777 Broadway, Boulder, Colorado 80302, (303) 441-1819, or from Mr. Jonathan Heroux, Piper Jaffray & Co. 1050 Seventeenth Street, Suite 2100, Denver, Colorado 80265, (303) 820-5808. By order of the City Council of the City of Boulder, Colorado, dated this 19t1i day of April, 2005. 02-132471.2 12 [CITY SEAL] By /s/Mark Ruzzin Mayor By /s/ Kathleen Simson Love Director of Finance and Record [End of Form of Official Notice of Bond Sale] Section 3. Electronic bid proposals for the Bonds shall be received and opened at the time, place and manner provided in the Official Notice of Bond Sale as herein prescribed. Section 4. The Council hereby approves the distribution and use in connection with the offering of the Bonds of the Preliminary Official Statement in substantially the form presented to the Council at this meeting, with such changes therein, if any, as aze approved by the Director of Finance and Record or the City Attorney. Section 5. The Official Bid Form in substantially the following form is hereby approved, with such changes thereto as the Mayor and the Director of Finance and Record shall approve consistent with changes to the Official Notice of Bond Sale: [Fonn of Official Bid Form) oz-isza~i z 13 OFFICIAL BID FORM $110,000,000' CITY OF BOULDER, COLORADO (Acting through its Water Utllity Enterprise and Its Wastewater Utility Enterprise) WATER AND SEWER REVENUE REFUNDING BONDS SERIES 2005A $7,940,000' CITY OF BOULDER, COLORADO (Acting through Its Water Uddty Euterprise and its Wastewater Utility Enterprse) WATER AND SEWER REVENUE REFUNDING BONDS SERIES 2005B Ms. Kathleen Simson Love Office of the Director of Finance and Record c/o Piper Jaffray & Co.. 1050 17th Street, Suite 2100 Denver, CO 80202 Attention: P. Jonathan Heroux Dear Ms. Love: For $9,050,000* aggregate principal amount (subject to adjustment as provided in the Official Notice of Sale) of your legally issued City of Boulder, Colorado (Acting through its Water Utility Enterprise and its Wastewater Utility Enterprise), Water and Sewer Revenue Refunding Bonds, Series 2005A (the "Series 2005A Bonds") and City of Boulder, Colorado (Acting through its Water Utility Enterprise and its Wastewater Utility Enterprise), Water and Sewer Revenue Refunding Bonds, Series 2005B (the "Series 2005B Bonds" and together with the Series 2005A Bonds, the "Bonds"), described in the Official Notice of Bond Sale dated Apri119, 2005, included with the Preliminary Official Statement of the City of Boulder, Colorado (the "City") pertaining to the Bonds, which Notice is by reference made a part hereof, we will pay you par plus a premium of $ plus accrued interest to date of delivery to us for said Bonds to beaz interest and mature, and be sold to the public at the yields, as follows: ` Subject to adjustment as set forth herein. 02-132471.2 14 Series 2005A Bonds Maturity (December 1) Interest Rate Principal Amount* 2005 2006 2007 2008 2009 2010 2011 2012 $65,000 135,000 140,000 145,000 150,000 150,000 155,000 170,000 *Principal amount of 2005A Bonds may be adjusted upward or downwazd for such maturities as the City shall in its discretion determine in an aggregate amount not to exceed $25,000 in any yeaz and not to exceed $150,000 in total, in order to (i) fund the 2005A Reserve Fund to an amount equal to not less than the average annual debt service on the 2005A Bonds and all other Parity Bonds (ii) establish the 1992 Escrow Fund for the 1992 Refunded Bonds. The 2005A Bonds shall all be serial bonds. 02-132471.2 15 Series 2005B Bonds Maturity (December 1) Interest Rate Principal Amount* 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 $255,000 590,000 610,000 625,000 645,000 665,000 690,000 715,000 740,000 770,000 800,000 835,000 *Principal amount of 2005B Bonds may be adjusted upwazd or downwazd for such maturities as the City shall in its discretion determine in an aggregate amount not to exceed $35,000 in any year and not to exceed $450,000 in total, in order to (i) fund the 2005B Reserve Fund to an amount equal to not less than the average annual debt service on the 2005B Bonds and all other Parity Bonds (ii) establish the 1992 Escrow Fund for the 1992 Refunded Bonds. Check one of the following (if neither is checked, 2005B Bonds shall be all serial bonds): All serial bonds. _ Serial bonds for the yeazs 2005 through 2013, and a term bond for the yeazs 20_ through 20_. All other years shall be serial bonds. Our calculation (which is not a part of this bid) of the actuarial yield from the above, computed from the date of the Bonds (May 1, 2005) and giving effect to mandatory sinking fund redemption and assuming semiannual compounding, as set forth above, is: Actuarial Yield (as defined under "TERMS OF SALE-Basis Of Award" in the Official Notice of Bond Sale): Prior to our accepting delivery of said Bonds, you agree to famish a certified transcript of all legal proceedings requisite to their issuance and delivery, including a signature and no-litigation certificate in the customary form evidencing the legality of said Bonds and the security provisions relating thereto in form satisfactory to Kutak Rock LLP, Denver, Colorado, whose unqualified approving legal opinion in the customary form shall accompany said Bonds at delivery. You also agree to provide us with a reasonable quantity of final Official Statements 02-t 32471.2 16 within seven business days from the date this bid is accepted, and we hereby request of such final Official Statements. The Bonds are to be delivered to us on or about June 7, 2005. The cost of typing the Bonds for delivery in book-entry only form at The Depository Trust Company and the fees of the approving attorneys will be paid by the City. Unless we have provided for use of a Financial Surety Bond to evidence our good faith deposit, we herewith hand you a cashier's check or certified check for $180,000 as evidence of our good faith in complying with the terms and conditions of this proposal which is to apply as partial payment (without interest thereon) for said Bonds when the legality of same has been approved, and to be forfeited as fully liquidated damages should we fail or refuse to take up said Bonds as above provided. Said check is to be returned to us (without interest thereon) if this proposal is not accepted, or if the above attorneys should decline to approve the legality or tax-exempt status of the issue and as otherwise described in the Official Notice of Bond Sale. If in lieu of said check, we fiunished a Financial Surety Bond, we agree to furnish the required deposit no later than 3:30 p.m. M.S.T. on the day following acceptance of our bid, in accordance with the Official Notice of Bond Sale. This offer is for immediate acceptance unless otherwise specified above. We understand that Piper Jaffray & Co. is acting as financial advisor to the City in connection with the issuance of the Bonds and that, pursuant to its contract with the City, it is required to submit a bid to purchase the Bonds. Dated this 3`d day of May, 2005. Respectfully submitted, (Firm Name) By Name _ Title Telephone The foregoing proposal accepted by the City Council as the governing body of the City this 3'~ day of May, 2005. By ~ -t -~ Mayor [End of Form of Official Bid Form] 02-132471.2 17 Section 6. The Mayor and the Director of Finance and Record and its financial consultants aze hereby authorized and directed to take all other action necessary or appropriate to effectuate the provisions of this Resolution. All action heretofore taken (not inconsistent with this Resolution) is hereby ratified, approved and confirmed. Section 7. If any section, paragraph, clause or provision of this Resolution shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, pazagraph, clause or provision shall not affect any of the remaining provisions of this Resolution. Section 8. This Resolution shall take effect immediately upon its introduction and passage. 02-132471.2 18 INTRODUCED, READ, PASSED AND ADOPTED this 19`h day of April, 2005. [CITY SEAL] B P Y Mayor Attest: r --~. By Director of Finance and Record 02-132471 2 19