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<br />I <br />I. OTHER CONSIDERATIONS <br />I Following is a summary of key factors in the finance plan: <br />, . We recommend the following call feature: <br />I Bonds maturing February 1, 2006 and thereafter will be subject to prepayment <br /> at the discretion ofthe City on February 1, 2005. <br />. . We anticipate that the City (in combination with any subordinate taxing <br /> jurisdictions or debt issued in the City's name by 501 (c)3 corporations) will not <br />I issue more than a total of $10,000,000 in tax-exempt debt during this calendar <br /> year. This will allow the Bonds to be designated as bank qualified. Bank qualified <br /> status broadens the market and achieves lower interest rates. <br />I . Because the City is not issuing more than $5,000,000 in tax-exempt obligations <br />I during calendar year 1997, the debt will qualify for the small issuer exemption <br /> from arbitrage rebate. <br />.- . The Bonds will be global book entry. As "paperless" bonds, you will avoid the costs <br /> of bond printing and the need for registrar/paying agent. The City will appoint <br /> itself as registrar/paying agent. <br />. . Standard and Poor's Corporation will be asked to rate this issue. The City <br />. currently has no outstanding credit rating since it has no bonds outstanding. <br /> Previously the City had an Al Moody's Investors Service bond rating. <br />I We hope to secure a similar rating from Standard and Poor's which would be an <br /> A +. Bonds rated A in the past month sold at a 5.37% TIC. These Bonds were <br />I similar in size with a slightly longer term than the schedule proposed for Arden <br /> Hills. Coupon rates ranged from 4.35% in 2001 to 5.50% in 2018. If current <br /> market conditions continue, we expect similar results. <br />, . We will request that bond insurance companies review this issue and qualify it for <br /> bond insurance. If qualified and purchasers choose to purchase the bond <br />I insurance, the issue will be rated "Aaa" by Moody's Investors Service and/or "AM" <br /> by Standard & Poor's Corporation. The estimated cost of the premium and the <br />I associated rating fees should be offset by the lower interest rates the community <br /> will receive by offering this issue "Aaa" rated and insured. It would be the option <br />I- of the bidders if they purchase bond insurance. <br />I Page 3 <br /> -.-. -- - L <br />