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Update Results of 2004 Water <br />System Bonds Issuance <br />August 5, 2014 <br />Page 2 <br />5.0% <br />4.0% <br />3.0% <br />2.0% <br />1.0% <br />0.0% <br />'AAA' MMD Yield Curve Changes <br />Date (2119114) <br />4 7 10 13 16 19 22 25 28 <br />With world events creating investor concern, the resulting effect was increased attention in the <br />municipal bond market by investors. As a result, Stifel's underwriter, Ben Stern, developed a <br />marketing program that targeted these investors. Stifel's sales staff highlighted the strong rating for <br />the bonds, the "essential service" nature of the Water System and the City's strong financial <br />position. Investors were very responsive to the "City's position ". Based on strong early feedback <br />from the sales force on the morning of the bond pricing, Mr. Stern took an aggressive approach by <br />lowering interest rates by .05% (5 basis points) when we formally released the bonds to the sales <br />force on July 22. By lowering interest rates by the 5 basis points for the 2017 -2022 maturities it <br />saved the City hundreds of thousands of dollars. <br />The graph below demonstrates the extent to which the bonds were strongly received and how <br />orders outweighed what was available. <br />$ in Millions <br />$6 Total Par: $15,690,000 <br />$5 - ■ Total Orders: $41,960,000 <br />Oversubscribtion:2.7x's <br />$4 <br />$3 <br />$2 <br />$1 <br />� Orders Y= Par <br />20152016201720182019202020212022202320242025202620272028202920302031 <br />Maturity Year <br />3 -2 <br />