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1, 2002, between the Authority and U.S. Bank National Association, as trustee (the "Trustee")
<br />(the " 2002A Indenture") and a resolution adopted by Authority on August 12, 2002 (the "Series
<br />2002A Bond Resolution"). The proceeds of the Series 2002A Bonds were used for construction
<br />and furnishing of a certain public safety facility (the "Safety Facility"). The City currently leases
<br />the Safety Facility pursuant to a Lease Agreement, dated September 1, 2002 (the "Lease
<br />Agreement"), between the Authority, as lessor, and the City, as lessee. The City has determined
<br />to terminate the Lease Agreement and purchase the Safety Facility from the Authority by
<br />refunding the Series 2002A Bonds, which are currently outstanding in the principal amount of
<br />$5,840,000
<br />(b) The Authority also previously issued its City Hall Expansion Revenue Bonds,
<br />Series 20028 (City of Elk River Lease Purchase Obligation), dated September 1, 2002 (the
<br />"Series 20028 Bonds"), pursuant to a Trust Indenture, dated November 1, 1991, as supplemented
<br />by a Supplement to Trust Indenture dated December 1, 1997, and further supplemented by a
<br />Supplement to Trust Indenture dated September 1, 2002, between the Authority and U.S. Bank
<br />National Association (formerly First Trust National Association), as trustee (the "Trustee")
<br />(collectively the "20028 Indenture") and a resolution adopted by Authority on August 12, 2002
<br />(the "Series 20028 Bond Resolution"). The proceeds of the Series 20028 Bonds were used for
<br />the expansion of the City Hall, including related furnishings, equipment and site improvements
<br />(the "City Hall Facility"). The City currently leases the City Facility pursuant to a Lease
<br />Purchase Agreement, dated November 1, 1991, as supplemented by a Supplement to Lease
<br />Purchase Agreement dated December 1, 1997, as further supplemented by a Supplement to Lease
<br />Purchase Agreement dated September 1, 2002 (collectively the "Lease Purchase Agreement"),
<br />between the Authority, as lessor, and the City, as lessee. The City has determined to terminate
<br />the Lease Purchase Agreement and purchase the City Hall Facility from the Authority by
<br />refunding the Series 20028 Bonds, which are currently outstanding in the principal amount of
<br />$1,270,000.
<br />(c) Pursuant to a resolution adopted by the City Council of the City on March 15,
<br />2010, the City has determined to issue its General Obligation Capital Improvement Plan Bonds,
<br />Series 2010A (the "Bonds") in the aggregate principal amount of $7,370,000, and use a portion
<br />of the proceeds of such bonds to finance the acquisition of the Safety Facility and the City Hall
<br />Facility and refund the outstanding Series 2002A Bonds and Series 20028 Bonds issued by the
<br />Authority.
<br />(d) Article X of the 2002A Indenture provides that, following the satisfaction of
<br />certain conditions, the Series 2002A Bonds may be defeased and will no longer be considered
<br />outstanding under the 2002A Indenture. Those conditions include the Authority depositing with
<br />the Trustee cash and/or obligations sufficient to pay and discharge the entire indebtedness on the
<br />Series 2002A Bond, providing the Trustee with an opinion of counsel of bond counsel, and the
<br />providing the Trustee with a certificate of the Authority indicating all conditions precedent to
<br />defeasance are satisfied.
<br />365439v1 JSB EL185-I I
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