2.0. ERMUSR 08-29-2018 - Laserfiche WebLink

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APPENDIX I PROPOSED FORM OF LEGAL OPINION Kennedy dy Offices in 470 U.S.Bank Plaza e Muu►eapol. 200 South Sixth Street Minneapolis MN 55402-1458 ♦• Saint Paul (612)337-9300 telephone Graven (612)337-9310 fax St.Cloud www.kennedy-graven.com CHARTER ED AffumativeAction,Equal Opportunity Employer Electric Revenue Bonds, Series 2018A City of Elk River Elk River Municipal Utilities Commission Sherburne County, Minnesota We have acted as bond counsel in connection with the issuance by the City of Elk River, Sherburne Cou ty, Minnesota, and the Elk River Municipal Utilities Commission (collectively, the "Issuer"), of Elec ric Revenue Bonds, Series 2018A, originally dated the date hereof, in the total principal amount of $ . For the purpose of rendering this opinion we have examined certified copies of certain proc-edings taken by the Issuer in the authorization, sale and issuance of the Bonds, including the form of the It onds, and certain other proceedings and documents furnished by the Issuer. From our examination of such proceedings and other documents, assuming the genuineness of the signatures thereon and the accuracy of t e facts stated therein and continuing compliance by the Issuer with its covenants to comply with the Inte al Revenue Code of 1986, as amended, and based upon laws, regulations, rulings and decisions in effect on the date hereof,it is our opinion that: 1. The Bonds are in due form, have been duly executed and delivered, and are valid and bind ng special revenue obligations of the Issuer, enforceable against the Issuer in accordance with their term., except as such enforcement may be limited by Minnesota or United States laws relating to b. ptcy,reorganization,moratorium or creditors' rights. 2. As provided in a resolution adopted by the Municipal Utilities Commission on August 29, 201:, and a concurring resolution of the City Council on July 16,2018,the Bonds constitute a first and prior pari i lien upon the net revenues of the electric utility plant and system in accordance with and subject to the prove sions of the resolutions. 3. Interest on the Bonds is excludable from gross income of the recipient for federal income tax purposes and, to the same extent, is excludable from taxable net income of individuals, trusts, and estaies for Minnesota income tax purposes, and is not a preference item for purposes of the computation of t e federal alternative minimum tax (although interest on the Bonds is included in adjusted current earn ngs in calculating corporate alternative minimum taxable income for taxable years that began prior to Jo uary 1, 2018), or the computation of the Minnesota alternative minimum tax imposed on indi iduals, trusts and estates. However, such interest is subject to Minnesota franchise taxes on corporations (including financial institutions) measured by income. The opinion set forth in this para:raph is subject to the condition that the Issuer comply with all requirements of the Internal Revenue Cod- of 1986, as amended, that must be satisfied subsequent to the issuance of the Bonds in order that inte est thereon be, or continue to be, excludable from gross income for federal income tax purposes and fro taxable net income for Minnesota income tax purposes. The Issuer has covenanted to comply with all s ch requirements. Failure to comply with certain of such requirements may cause interest on the Bonos to be included in gross income for federal income tax purposes and taxable net income for Mi esota income tax purposes retroactively to the date of issuance of the Bonds. We express no opinion reg. ding tax consequences arising with respect to the Bonds other than as expressly set forth herein. I-1 44