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City of Pequot Lakes, Minnesota <br />Recommendations for Issuance of Bonds <br />$1, 270, 000 General Obligation Utility Refunding Bonds, Series 2012A <br />The Council has under consideration the issuance of bonds to refund the outstanding maturities of the City's 2000A <br />General Obligation Bonds. This document provides information relative to the proposed issuance. <br />KEY EVENTS: The following summary schedule includes the timing of some of the key events that will <br />occur relative to the bond issuance. <br />June 5, 2012 <br />Week of June 25, 2012 <br />July 10, 2012,10:00 a.m. <br />July 10, 2012, 6:30 p.m. <br />Early August, 2012 <br />October 1, 2012 <br />Council sets sale date and terms <br />Rating conference is conducted <br />Competitive bids are received <br />Council considers award of bonds <br />Proceeds are received <br />Redeem the 2000A Bonds <br />RATING: An application will be made to Moody's Investors Service for a rating on the Bonds. This will <br />be the City's first application for a credit rating. <br />THE MARKET: Performance of the tax-exempt market is often measured by the Bond Buyer's Index ("BBI") <br />which measures the yield of high grade municipal bonds in the 20th year for general <br />obligation bonds (the BBI 20 Bond Index) and the 30th year for revenue bonds (the BBI 25 <br />Bond Index). The following chart illustrates these two indices over the past five years. <br />N <br />� <br />� <br />BBI 25-bond (Revenue) and 2U-bond (G.O.) R�tes for5 Years <br />Ending 5/242012 <br />6.5% <br />6.096 <br />5.596 <br />� +ti.. <br />�y �� . � <br />S.V IO <br />r\� "�� �ryi <br />4.5�6 r R�'� <br />4.096 <br />. � <br />,� <br />� <br />';� <br />. <br />.� <br />� � . <br />y�r <br />1 � � � <br />M' <br />5C24�D12 <br />25 bond:4.7al6 <br />20 bond:3.81l� <br />� • <br />' ., <br />. . '•�. <br />. u <br />� � •�e <br />�i. <br />1 � . /• .�, � � <br />� <br />+� •+. � �'. <br />� �. �' <br />ati+ . <br />3.5% . . . . . . . . . . . . . . . . . . . <br />� `�e' ��' � �� �w' � ��� �� � �� � , � � • �� �� � �� a' � $ ` � �� `� �e � "� , �' ���' �, �� �ti <br />� <br />���� Springsted <br />. . ��,�k. <br />- - -BBI 23 Bond <br />BBI 2[1 Bond <br />p��s Pnspared by Sprin�sted /ncnrpar�ted <br />