CHICAGO – A Minnesota city that defaulted on $26.4 million of revenue bonds for a broadband communications network would pay bondholders $5.75 million and free up escrowed funds under a proposed settlement.

If approved, the settlement between the city of Monticello and bondholder trustee Wells Fargo NA would stave off litigation threatened by investors accusing the city of securities fraud and misrepresenting the bonds in its offering statement. It would also save bondholders from what could be a costly legal battle with no certainty of recouping any of their investments. 

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