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Resolution No. 87-02 RESOLUTION NO. RESOLUTION OF THE CITY OF TIGARD, WASHINGTON COUNTY, OREGON AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS, SERIES 1987. WHEREAS, the CITY OF TIGARD, Washington County, Oregon (the "City") is authorized pursuant to the Constitution and laws of the State of Oregon to issue advance refunding bonds for its outstanding general obligation bonds; and WHEREAS, the City resolved to submit to the Oregon State Treasurer a plan to refund the City's outstanding General Obligation City Building Bonds, Series 1984 (the "Refunded Bonds") ; and WHEREAS, the refunding plan has been submitted to the State Treasurer for approval; and WHEREAS, in order for a timely delivery the refunding bonds it is desirable to authorize the Acting Finance Director to sell and deliver the Refunding Bonds; now, therefore, THE CITY COUNCIL OF THE CITY OF TIGARD, WASHINGTON COUNTY, OREGON, RESOLVES AS FOLLOWS: Section 1. Issue. For the above purpose, the City shall issue its General Obligation Refunding Bonds, Series 1987, (the "Refunding Bonds"), in the approximate amount of TWO MILLION ONE HUNDRED FIFTEEN THOUSAND DOLLARS ($2,115,000) , to be dated January 1, 1987, to be in denominations of Five Thousand Dollars ($5,000) or integral multiples thereof, to be in fully registered form, to bear interest payable on June 1 and December 1 of each year until maturity or prior redemption commencing June 1, 1987. and to mature serially on June 1 of each year as follows: Year Amount Year Amount 1987 $ 10,000 1996 X145,000 1988 25,000 1997 160,000 1989 30,000 1998 170,000 1990 30,000 1999 180,000 1991 30,000 2000 190,000 1992 30,000 2001 205,000 1993 35,000 2002 215,000 1994 35,000 2003 235,000 1995 140,000 2004 250,000 The principal amount maturing in any year may be changed in order to maximize savings and properly size the issue. 1 - PESOLUTION Changes shall be made by the City Manager or Actdelivery nancf the ce Director pursuant to Section 8 hereof, prior Refunding Bonds. Section 2. Purpose. The net proceeds of the Refunding Bonds shall be used to advance refund the Refunded Bonds. The Refunding Bonds shall be issued in an amount sufficient, together with any additional funds contributed by the City to pay all principal and interest on the City's Refunded Bondsthrough the time they are called for redemption. The net proceeds Refunding Bonds shall be used to purchase government obligations which shall be placed irrevocably in escrow and used solely to pay principal and interest due on the Refunded Bonds. section 3. Redemption. The City reserves the right to redeem all or any portion of the Refunding bonds maturing after June 1, 1996, in inverse order of maturity and by lot within a maturity on June 1' 6uedninterestinterest thepayment fiixed for date thereafter, at par plusaccr redemption. Notice of redemption shall be given by publication as required by law and by mailing notice thereof to the registered owners of the bonds to be redeemed not less than nthirt days prior to the redemption date. Any failure to g ive noice shall not invalidate the redemption of the bonds. All bonds called for redemption shall cease to bear interest from the redemption date designated in the notice. Section 4. Security. The full faith and credit of the City are pledged to the successive holders of each of the Refunding Bonds for the punctual payment of such obligations, when due. The city shall levy annually, as provided direct ad valorem tax upon all of the taxable property within the City in sufficient amount, after taking into consideration discounts taken and delinquencies that may occur ir thes themenpo ment odebt f such taxes and other monies available service Bonds service on the Refunding Bonds. to pay the City covenants with the owners of promptly as they mature; its Refunding Bords to levy such a tax annually during each year that any of tie R- ending Bonds, or bonds issued to refund them, are outstanding. Section 5. Maintenance of Tax-Exemotystatus- The City shall take no action nor make any use of the proceeds of the Refunding Bonds or ad valorem tax revenues intended to be used to pay principal and interest on such bonds, which will cause the Refunding Bonds to lose their tax-exempt status under federal or State of Oregon income tax laws, regulations and judicial or administrative inter_retation.:. The City covenants to comply with all applicable provisions of the Internal Revenue Code of 1986 (the "Code"). The covenants contained in this section shall constitute contracts with the owners of the Bonds, and shall be 2 - RESOLUTION enforceable by them. Section 6. Form of Registered Bonds. The City may issue the Refunding Bonds as one or more typewritten, temporary bonds which shall be exchangeable for definitive bonds when definitive bonds are available. The Refunding Bonds shall be in substantially the following form: R- $ _ UNITED STATES OF AMERT_CA STATE OF OREGON I COUNTY OF WASHINGTON CITY OF TIGARD GENERAL, OBLIGATION REFUNDING BOND, SERIES 1987 DATED INTEREST % PER ANNUM MATURITY DATE CUSIP The CITY OF TIGARD, in the County of Washington, State of Oregon (the "City") , for value received, acknowledges itself indebted and hereby promises to pay to , or registered assigns, the principal amount of Dollars u ($ ) on the above maturity date together with interest thereon from the date hereof at the rate per annum indicated above. Interest is payable semiannally on the first day of June and the first day of December in each year until maturity or prior redemption, commencing June 1, 1987. Interest upon this bond is payable through the principal corporate trust office of the paying agent and registrar (the "Registrar") of the City by check or draft. Checks or drafts wi11 be mailed on the interest payment date to the name and address of the registered holder as they appear on the bond register as of the fifteenth day of the month prior to the interest payment date. Bond principal is payable upon presentation and surrender of this bond to the Registrar. ADDITIONAL PROVISIONS OF THIS BOND APPEAR ON THE REVERSE SIDE; THESE, PROVISIONS HAVE THE SAME EFFECT AS IF THEY WERE PRINTED HEREIN. IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all conditions, acts, and things required to exist, ro happen, and to be performed precedent to and in the issuance of this bond have existed, have happened, and have been performed in due time, form, and manner as required by the Constitution and Statutes of the State of Oregon and the Charter of the City; that the issue of which this bond is a part, and all other obligations of such City, are within every debt limitation and other limit prescribed by such Constitution and Statutes and Charter; and that the City has covenanted to provide for the levying annually of a direct ad 3 - RESOLUTION valorem tax upon all the property within the City so taxable for its purposes in an amount sufficient, with other available funds, to pay the interest on and the principal of the bonds of such issue as such obligations become due and payable. IN WITNESS WHEREOF, the City Council of the City of Tigard, Washington County, Oregon, has caused this bond to be signed by facsimile signature of its Mayor and attested by facsimile signature of its Acting Finance Director as of this 1st day of January, 1987. Mayor ATTEST: Acting Finance Director THIS BOND SHALL NOT BE VALID UNLESS PROPERLY AUTHENTICATED BY THE REGISTRAR IN THE SPACE INDICATED BELOW. DATED: REGISTRAR'S CERTIFICATE OF AUTHENTICATION This is one of the City of Tigard, Washington County, Oregon General Obligation Refunding Bonds, Series 1987, issued pursuant to the Resolution described herein. UNITED STATES NATIONAL BANK OF OREGON, as Registrar By: Authorized Officer Note to Printer: The following language should be printed on the reverse of the bond: This bond is one of the General Obligation Refunding Bonds, Series 1987, of the City, and is issued by the City far the purpose of advance refunding its General Obligation City Building Bonds, Series 1984, in full and strict accordance and compliance with all of the provisions of the Constitution and Statutes of the State of Oregon and the Chart ar of the City. The City reserves the right to redeem all or any portion of the bonds maturing after June 1, 1996, in inverse order of maturity and by lot within any maturity on June 1, 1996, and on any interest payment date thereafter, at par plus accrued interest to the date fixed for redemption. Notice of redemption shall be given by publication as 4 - RESOLUTION t, t required by law and by mailing notice thereof to the registered owners of the bonds Lo be redeemed not less than thirty days prior to the redemption date. Any failure to give notice shall not invalidate the redemption of the bonds. All bonds called for redemption shall cease to bear interest from the redemption date designated in the notice. The bonds are issuable in the form of registered bonds without coupons in the denominations of $5,000 or any integral multiple thereof. Any transfer of this bond must be registered, as provided in the resolution of the City authorizing the issuance of its General Obligation Refunding Bonds, Series 1987 (the "Resolution"), upon the bond register kept for that purpose at the office of the Registrar. The City and the Registrar may treat the person in whose name this bond is registered as its absolute owner for all purposes, as provided in the Resolution. This bond may be exchanged fcr bonds of the same series and maturity, but of different authorized denominations, as provided in the Resolution. The bondowner may exchange or transfer any bond by surrendering it (together with a written instrument of exchange or transfer satisfactory to the Registrar duly executed by the registered owner or his duly authorized attorney) at the office of the Registrar, in the manner and subject to the conditions set forth in the Re-olution. ASSIGNMENT FOR VALUE RECEIVED, the unders_; -ad sells, assigns and transfers unto Please insert social security or other identifying number of assignee the within Bond and does hereby irrevocably constitute and appoint as attorney to transfer this Bond on the books kept for registration thereof with the full power of substitution in the premises. Dated: 5 - RESOLUTION Ems NOTICE: The signature to this assignment must correspond with the name of the registered owner as it appears upon the face of the within bond in every particular, without alteration or enlargement or any change whatever. Signature Guaranteed (Bank, Trust Company or Firm) Authorized Officer The following abbreviations, when used in the inscription on the face of the within Bond, shall be construed as though they were written out in full according to applicable laws or regulations. TEN COM -- tenants in common TEN ENT -- as tenants by the entireties JT TEN -- as joint tenants with right of survivorship and not as tenants in common OREGON CUSTODIANS use the following CUST UL OREG as custodian under the laws of Oregon for MIN (Minor's Name) Additional abbreviations may also be used though not in the list above. Section 7. Authentication, Registration and Transfer. A. All Refunding Bonds shall be in registered form. The City shall appoint a registrar and paying agent for the Refunding Bonds (the "Registrar") when the Refunding Bonds are sold. A successor Registrar may be appointed for the Refunding Bonds by ordinance or resolution of the City. The Registrar shall provide notice to bondowners of any change in the Registrar not later than the bond payment date following the change in Registrar. B. No Refunding Bond shall be entitled to any right or benefit under this Resolution unless it shall have been authenticated by an authorized officer of the Registrar. The Registrar shall authenticate all Refunding Bonds to be delivered at closing of this bond issue, and shall additionally authenticate all Refunding Bonds properly surrendered for exchange or transfer pursuant to this Resolution. C. The ownership of all Refunding Bonds shall be 6 - RESOLUTION s® � entered in the bond register maintained by the Registrar, and the City and the Registrar may treat the person listed as owner in the bond register as the owner of the Refunding Bond for all purposes. D. The Registrar shall mail each interest payment on the interest payment date to the name and address of the bondowner as it appears on the bond register as of the fifteenth day of the month preceding an interest payment date (the "Record Date") . If payment is so mailed, neither the City nor the Registrar shall have any further liability to any party for such payment. E. Refunding Bonds may be exchanged for an equal principal amount of Refunding Bonds of the same maturity which are in different denominations, and Refunding Bonds may be transferred to other holders if the bondholder submits the following to the Registrar: (a) written instructions for exchange or transfer satisfactory to the Registrar, signed by the bondowner or his attorney in fact and guaranteed or witnessed in a manner satisfactory to the Registrar; and (b) the Refunding Bonds to be exchanged or transferred. F. The Registrar shall not be required to exchange or transfer any Refunding Bonds submitted to it during any period beginning with a Record Date and ending on the next following payment date; however, such Refunding Bonds shall be exchanged or transferred promptly following that payment date. G. The Registrar shall note the date of authentication on each Refunding Bond. The date of authentication shall be the date on which the bondowner's name is listed on the bond register. H. For purposes of this section, Refunding Bonds shall be considered submitted to the Registrar on the date the Registrar actually receives the materials described in subsection E. of this section. I. The City may alter these provisions regarding registration and transfer by mailing notification of the altered provisions to all bondowners. The altered provisions shall take effect on the date stated in the notice, which shall not be earlier than 45 days after notice is mailed. Section 8. Sale of Refunding Bonds. The City shall cause to be published in The -)>egonian, Portland, Oregon, and in the Daily Journal of Commerce Portland Business Today, Portland, Oregon, notices of sale of the Refunding Bonds, or summaries, in 7 - RESOLUTION the form substantially as shown on Exhibit A attached hereto and by this reference incorporated herein, or summaries, as provided by law. The Refunding Bonds shall be sold upon the terms and sold on the date and at the time and place stated in Exhibit A, unless the Mayor or Acting Finance Director establishes different terms or a different date, time, or place. The Acting Finance Director is hereby authorized to establish the final principal amounts and maturity schedule for the Refunding Bonds, to award the sale of the Refunding Bonds, and to take any and all action which may be required in order to sell and deliver the Refunding Bonds in accordance with this Resolution, without additional action by the City Council. The Acting Finance Director shall report the results of the sale of the Refunding Bonds to the City Council. Section 9. Escrow. As provided in Section 2 of this Resolution, the net proceeds of the Refunding Bonds are to be placed in irrevocable escrow. The City Manager or Acting Finance Director are hereby authorized to select an escrow agent and approve and execute an escrow agreement, which shall be substantially in the form attached as Exhibit B, with such changes as may be approved by counsel to the City. The escrow agent, City Manager or Acting Finance Director are hereby authorized to subscribe for and purchase the government obligations to be placed in the escrow, on behalf of the City. Section 10. Reemption of Refunded Bonds. Contingent solely on the issuancd e of the Refunding Bonds and the deposit of the net proceeds with the escrow agent, the City hereby irrevocably calls for redemption all its then outstanding Refunded Bonds, on June 1, 1994 at a price of 101% of par, plus interest accrued to June 1, 1994. Section 11. Designation of Bonds as Qualified Tax- Exempt Obligations. The City designates the bonds as "qualified tax-exempt obligations" pursuant to Section 255(b)(3) of the Code. The City covenants that it will not designate tax-exempt obligations in the current calendar year in an aggregate amount of more than $10,000,000. The City does not reasonably expect that it (or any of its subordinate entities) will issue more than $10,000,000 of tax-exempt obligations during the current calendar year. ADOPTED this p-rl= day of January, 1987. Mayor, City of Tigard, Oregon ATTEST: City Recorder Page 8 - RESOLUTION CWCcwc394 1 .mom EXHIBIT A OFFICIAL NOTICE OF BOND SALE APPROXIMATELY $2,115,000 STATE OF OREGON COUNTY OF WASHINGTON CITY OF TIGARD GENERAL OBLIGP_TION REFUNDING BONDS, SERIES 1987 NOTICE is hereby given that sealed bids will be received on behalf of the City of Tigard, Washington County, Oregon (the "City"), until 10:00 o'clock a.m. , Prevailing Pacific Time, on January 27, 1987, at the offices of Government Finance Associates, 1300 S.W. 5th Avenue, Suite 2929, Portland, Oregon 97201, at which time they will be publicly opened and announced. The bids shall be considered and acted upon by the City within four business hours. ISSUE: Approximately TWO MILLION ONE HUNDRED FIFTEEN THOUSAND DOLLARS ($2,115,000), consisting of registered bonds in denominations of FIVE THOUSAND DOLLARS ($5,000) or integral multiples thereof, all dated January 1, 1987. INTEREST RATE: Interest is payable semiannually on June 1 and December 1 of each year until maturity or prior redemption, commencing June 1, 1987. 3idders must specify the interest rate or rates which the bonds hereby offered fcr sale shall bear. The bids shall comply with the following conditions: 1) Each interest rate specified in any bid must be a multiple of One One- Hundredths (.01%) of one percent (1$) ; (2) No bond shall bear more than one rate of interest; (3) Each bond shall bear interest from its date to its stated maturity date at the interest rate specified in the bid; (4) All bonds maturing at any one time shall bear the same rate of interest; (5) No interest rate shall exceed ten percent (10$); and (6) The interest rate for any maturity shall not be less than the interest rate specified for any prior maturity. MATURITIES: The bonds shall mature serially on the first day of June of each year as follows: Ii 1 - (EXHIBIT A - OFFICIAL NOTICE OF BOND SALE) !�! I Year Amount Year Amount 1987 $ 10,000 1996 $145,000 1988 25,000 1997 160,000 1989 30,000 1998 170,000 1990 30,000 1999 180,000 1991 30,000 2000 190,000 1992 30,000 2001 205,000 1993 35,000 2002 215,000 1994 35,000 2003 235,000 1995 140,000 2004 250,000 The principal amount maturing in any year may be changed in order to maximize savings and properly size the issue. The bidder may contact the City's financial consultant the day prior to the bond sale to determine those changes, if any. REDEMPTION: The City reserves the right to redeem all or any portion of the Bonds maturing after June 1, 1996, in inverse order of maturity and by lot within a maturity on June 1, 1996, and on any interest payment date thereafter, at par plus accrued interest to the date fixed for redemption. Notice of redemption shall be given by publication as required by law and by mailing notice thereof to the registered owners of the bonds to be redeemed not less than thirty days prior to the redemption date. Any failure to give notice shall not invalidate the redemption of the bonds. All bonds called for redemption shall cease to bear interest from the redemption date designated in the notice. REGISTRATION: The bonds will be issued in fully registered form, and may be exchanged at the expense of the City for similar bonds ::f different authorized denominations. Bonds may not be converted to bearer form. PAYMENT: Principal and interest are payable, either at maturity or upon earlier redemption, through the office of the registrar and paying agent of the City. BANK ELIGIBILITY: The Bonds have been designated as "qualified tax-exempt obligations" under Section 265(b) (3) of the Internal Revenue Code of 1986 (the "Code"). PURPOSE: Proceeds of the bonds will be used to advance refund the City's General Obligation City Building Bonds, Series 1984. SECURITY: The bonds are general obligations of the City. The City has covenanted to levy an ad valorem tax annually which, with other available funds, will be sufficient to pay bond principal and interest as they come due. 2 - (EXHIBIT A - OFFICIAL NOTICE OF BOND SALE) 9 <, LEGAL OPINION: The approving opinion of Lindsay, Hart, Neil & Weigler, Lawyers, of Portland, Oregon, will be provided at no cost to the purchaser, and will be printed on the bonds at the expense of the City. TAX EXEMPT STATUS: Assuming compliance by the City with its covenants relating to the tax-exempt status of the bonds, interest on the bonds is exempt from taxation by the United States under present federal income tax laws and from personal income taxation by the State of Oregon under present state law (except for certain taxes on corporations) . The City has legal authority to comply with its covenants. The bonds are not "private activity bonds" under Section 141 of the Code. BEST BID: The bonds will be awarded to the responsible bidder whose proposal will result in the lowest true interest cost to the City. True interest cost will be determined by doubling the semiannual interest rate necessary to discount the debt service to January 1, 1957 and the price bid for the bonds. Each bidder is requested to supply the total interest cost and true interest cost that the City will pay if the bid is accepted. The purchaser must pay acer,.ed interest, computed on a 350-dav basis, from the date of the bonds to the date or delivery. The cost of printing the bonds will be paid by the City. REOFFERING PRICE: The successful bidder must certify the initial reoffering price of the Bonds to the City's financial advisor within 30 minutes after the bids are opened. This certification shall constitute the agreement of the bidder to offer all bonds in each maturity for sale at a price no greater than the certified price until at least ten percent of the principal amount of each maturity is sold at a price less than or equal to the certified price. Failure to honor this agreement may result in cancellation of the sale and forfeiture of the bidder's good faith deposit. DELIVERY: Delivery of th-- bonds will be made without cost to the successful bidder at such bank in the City of Portland, Oregon, as the successful bidder shall name. Payment for the bonds must be made in Federal funds. Delivery will be made within thirty days. INSURANCE: The City may qualify the bonds for insurance. The bidder may elect to insure the Bonds at the expense and risk of the bidder. The bidder must stat e in its bid whether the Bonds will be insured and what company will provide the insurance. Bidders electing to insure may bid a total discount of three percent (3a) FORM OF BID: All bids must be for not less than all the bonds hereby offered for sale, and for not less than ninety-eight 3 - (EXHIBIT A - OFFICIAL NOTICE OF BOND SALE) 0 percent (98%) of the par value thereof (unless the bidder elects to insure the bonds, as provided above) plus accrued interest to the date of delivery. Each bid together with bidder's check as herein specified must be enclosed in a sealed envelope addressed to the City and designated "Proposal for Bonds" . Bidders shall specify the price as a percentage of the final amount of Bond principal. BID CHECK: All bids must be unconditional and accompanied by a certified or cashier's check on a bank doing business in the State of Oregon for not less than Forty-Two Thousand Three Hundred Dollars ($42,300) payable to the order of the City to secure the City from any loss resulting from the failure of the bidder to comply with the terms of its bid. Checks will be forfeited to the City as liquidated damages in case the bidder to whom the bonds are awarded withdraws it:- bid or fails to complete its purchase in accordance with the terms thereof. No interest shall be allowed on the deposit but the check of the successful bidder will be retained as part payment of the bonds or for liquidated damages as described above. Checks of the unsuccessful bidders will be returned by the City promptly. RIGHT OF REJECTION: The City reserves the right to reject any or all bids, and to waive any irregularities. OFFICIAL STATEMENT AND ADDITIONAL INFORMATION: The City has prepared an official statement relating to the bonds, a copy of which will be furnished upon request to its financial advisor, Government Finance Associates, 1300 S.W. Fifth Avenue, Suite 2925, Portland, Oregon 97201, telephone (503) 222-1405; Attention Naomi Keck. Requests for additional information should be directed to the City's financial advisor. CUSIP: CUSIP numbers will be imprinted upon all bonds of this issue at the City's expense. Failure to print, or improperly imprinted numbers will not constitute basis for the purchaser to refuse to accept delivery. NO LITIGATION: At closing, the City will furnish the successful bidder a certificate that there is no litigation pending affecting the validity of the bonds. BY ORDER OF CITY OF TIGARD WASHINGTON COUNTY, OREGON 4 - (EXHIBIT A - OFFICIAL NOTICE OF BOND SALE) CWCcwc394 EXHIBIT B _ ^vLROW DEPOSIT AGREEMENT ESCROW DEPOSIT AGREEMENT, dated as of January 1, 1987, by and between the CITY OF TIGARD, Washington County, Oregon (the "Issuer"), and , Portland, Oregon (the "Escrow Agent") and its successors. THE PARTIES RECITE: A. Pursuant to a bond resolution, dated as of January 12, 1987 (the "Resolution"), the Issuer has determined to issue its General Obligation Refunding Bonds, Series 1987 (the "Refunding Bonds") , for the purpose of providing funds to pay the costs of refunding the callable portion of the Issuer's currently outstanding General Obligation City Building Bonds, Series 1984 (the "Refunded Bonds") . B. The Escrow Agent has reviewed the Resolution and this Agreement, and is willing to serve as Escrow Agent hereunder. C. The Escrow Agent has received true copies of this Resolution, the resolution authorizing the issuance of the Refunded Bonds (the "Refunded Bonds Resolution") , and the verification of , Certified Public Accountants, which is dated January _, 1987 the "Verification"). THE PARTIES AGREE: 1. Notice of Redemption. Pursuant to the Resolution, the Refunded Bonds have been designated for redemption on June 1, 1994 at a price of 101% of par, plus interest accrued to June 1, 1994. The Escrow Agent agrees to give notice of the redemption of the Refunded Bonds in the manner provided in the Refunded Bonds Resolution, and in substantially the form attached hereto as Appendix "A". The Escrow Agent hereby certifies t:lat provision satisfactory and acceptable to the Escrow Agent has beer. made for the giving of notice of redemption of the Refunded Bonds. The content of the notice shall be the responsibility of the Issuer. 2. Establishment of Escrow. There is hereby created and established with the Escrow Agent a special and irrevocable escrow designated City of Tigard, Washinaton County, Oregon Refunded Bonds Trust Account, Escrow Detosit Fund (the "Escrow Deposit Fund") to be held in the custody of the Escrow Agent separate and apart from other funds of the Issuer or of the CL Escrow Agent. The Escrow Deposit Fund will contain direct obligations of, or obligations guaranteed by, the United States Government ("Government Obligations") and monies to be applied as Page 1 - Escrow Deposit Agreement - Exhibit B provided herein, which will be in an amount at least sufficient to pay, as of any date of calculation, the principal of and the interest on the Refunded Bonds as the same shall become due through their redemption on the date indicated in Section 1 hereof, as shown in the Verification. 3. Deposit and Use of Funds. The Escrow Agent hereby acknowledges receipt of (i) the immediately available monies and (ii) the Government Obligations described in the Verification and agrees to deposit both in the Escrow Deposit Fund. (a) Such Government Obligations and monies, together with any income or interest earned thereon, shall be held in escrow and shall be applied solely to the payment of the principal of, and interest on the Refunded Bonds through their redemption date, as shown in the Verification. (b) The Escrow Agent shall receive the matured principal of and the interest on the Government Obligations as the sasae are payable. On or before each interest payment date on the Refunded Bonds, the Escrow Agent shall transfer sufficient funds to the paying agent for the Refunded Bonds (the "Paying Agent") for the payment of interest on and principal of the Refunded Bonds pursuant to the schedule shown in the Verification. 4. Irrevocable Escrow. The deposit of the Government Obligations and monies in the Escrow Deposit Fund shall constitute an irrevocable deposit and escrow for the benefit of the holders of the Refunded Bonds. 5. Reinvestment; Substitution of Investments. Any monies remaining in the Escrow Deposit Fund after an interest payment date on the Refunded Bonds shall be invested, to the largest integral multiple of $100 equalling or exceeding $1,000.00 which is less than the amount remaining, in United States Treasury Obligations, State and Local Government Series, which are purchased at par and bear a zero rate of interest, and mature when such funds are required to pay principal or interest on the Refunded Bonds, or their last redemption date, whichever is earlier. However, such funds may be reinvested in other Government Obliga*:ons, or at the direction of the Issuer, the Escrow Agent may redeem the Government Obligations and reinvest the proceeds thereof, together with other monies held in the Escrow Deposit Fund, in other Government Obligations specified by the Issuer, provided that the Issuer delivers to the Escrow Agent: (a) the opinion of nzcionally recognized bond counsel that the foregoing actions wi.Li not cause interest paid on the Refunding Bonds to become taxable under Federal income tax laws; and (b) the verification of an independent certified public accounting firm that the calculated earnings on the resulting investments in the Escrow Deposit Fund will be sufficient to pay principal and interest due on the Refunded Bonds according to the payment schedule shown in the Verification. Page 2 - Escrow Deposit Agreement - Exhibit B 6. Payment and Duties of Escrow Agent. (a) In consideration of its initial fee, the Escrow Agent agrees to establish the Escrow Deposit Fund, to invest the monies in that fund pursuant to this Escrow Deposit Agreement and the instructions of the Issuer and make disbursements to the Paying Agent, and to give notice of redemption, all as herein provided. The Issuer agrees to and shall pay to the Escrow Agent its out-of-pocket expenses, and its reasonable fees and expenses for additional action taken pursuant to this Escrow Deposit Agreement at the request of the Issuer. Such exoenses shall include the fees of any independent consultants, including, without limitation, attorneys, regardless of whether formal legal proceedings are required and, if required, on trial and appeal therefrom, from any monies of the Issuer lawfully available therefor. However, in no event shall the Escrow Agent have any lien whatsoever upon any of the monies and Government Obligations in the Escrow Deposit Fund for the payment of such fees and expenses. The Issuer hereby assumes liability for, and hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to indemnify, protect, save and keep harmless the Escrow Agent and its respective successors, assigns, agents and servants, from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, cost— expenses and disbursements (including legal fees and disbursements, regardless of whether formal legal proceedings are required, and, if required, on trial and appeal therefrom) of whatsoever kind and nature which ,..ay be imposed on, incurred by, or asserted against, at any time, the Escrow Agent (whether or not also indemnified against by the Issuer or any other person under any other agreement or instrument) and in any way relating to or arising out of the execution and delivery of this Escrow Deposit Agreement, the establishment of the Escrow Deposit Fund, the acceptance of the monies and securities or the proceeds thereof and any payment, transfer or other application of monies or securities by the Escrow Agent in accordance with the provisions of this Escrow Deposit Agreement, or as may arise by reason of an act, omission or error of the Escrow Agent made in good faith in the conduct of its duties; provided, however, that the Issuer shall not be required to indemnify the Escrow Agent against its own negligence, active or passive, or misconduct. In no event shall the Issuer be liable to any person by reason of the transactions contemplated hereby other than to the Escrow Agent as set forth in this Section 6. The indemnities contained in this Section 6 shall surviv^ the termination of this Escrow Deposit Agreement. (b) The Escrow Agent shall be under no obligation to inquire into or be in any way responsible for the performance or nonperformance by the Issuer of any of its obligations, or to protect any of the Issuer's rights under any bond proceeding or any of the Issuer's other contracts with or franchises or privileges from any state, county, municipality or other Page 3 - Escrow Deposit Agreement - Exhibit B governmental City or with any person. The Escrow Agent shall not be liable for any act done or step taken or omitted by it, or for any mistake of fact or law, or for anything which it may do or refrain from doing, except for its negligence, misconduct, or its default in the performance of any obligation imposed upon it hereunder. The Escrow Agent shall not be liable or responsible for any loss resulting from any investment made pursuant to this Escrow Deposit Agreement and in full compliance with the provisions hereof. 7. Escrow Inviolate. No paying agents' fees or other charges of any nature may be paid from the escrowed money or Government Obligations prior to retirement of all Refunded Bonds. The Issuer agrees that it will pay any and all such fees from its other legally available funds as such payments become due prior to such retirement. 8. Notice of Deficiency. If at any time there shall be insufficie, funds o:. hand in the Escrow Deposit Fund for the payment of principal and interest and premium, if any, falling due on the Refunded Bonds, the Escrow Agent shall promptly notify the Issuer of such deficiency. 9. Reporting. The Escrow Agent shall mail a report to the Issuer annually of the receipts, income, investments, redemptions and payments of and from all of the funds and accounts established hereunder during the next preceding fiscal year. 10. Time for Payment. The Escrow Agent shall make payments out of the Escrow Deposit Fund to the Paying Agent in sufficient time to permit the Paying Agent to pay principal of and interest on the Refunded Bonds without default. After all sums required for the payment of principal of and interest on the Refunded Bonds have been paid to the Paying Agent as herein provided, the Escrow Agent shall transfer any remaining monies or Government Obligations to the Issuer. 11. Irrevocable Escrow for Benefit of Bondholders. The Escrow Agent and the Issuer recognize that the holders from time to time of the Refunded Bonds and any coupons appertaining thereto have a beneficial and vested interest in the Government obligations and monies to be held by the Escrow Agent as herein provided and in the provisions of this Escrow Deposit Agreement. It is therefore recited, understood and agreed that this Escrow Deposit Agreement shall not be subject to revocation or amendment until its provisions have been fully executed. 12. Escrow Agert not Directly Liable. None of the provisions contained in this Escrow Deposit Agreement shall require the Escrow Agent to use or adva^.:e its own funds or otherwise incur direct financial liabil.ty in the performance of any of its duties or the exercise of any of its rights or powers hereunder. The Escrow Agent shall be under no liability for Page 4 - Escrow Deposit Agreement - Exhibit B interest on any funds or other property received by it hereunder except as herein expressly provided. 13. Segrsegation of Escrow. The Escrow Agent shall hold the Government Obligations and all monies received by it from the collection of principal of and interest on the Government Obligations, and all monies received from the Issuer hereunder, in a special fund and separate trust account wholly segregated from all other funds and investments deposited with the Escrow Agent, and shall never commingle such investments with other monies or investments. Title to such Government Obligations and monies shall remain in the Issuer. 14. Governing Law. This Escrow Deposit Agreement shall be governed by and construed in accordance with the laws of the State of Oregon. 15. Notices. Any notice, request, communication or other paper shall be sufficiently given and shall be deemed given when delivered or mailed, by registered or certified mail, postage prepaid or sent by telegram as follows: if to the Issuer, at: 13125 S.W. Hall Boulevard, Tigard, Oregon 97223; if to the Escrow Agent, at: The Issuer and the Escrow Agent may designate any further or different addresses to which subsequent notices, requests, communications or other papers shall be sent. 16. Severability. If any one or more of the covenants or agreements provided in this Escrow Deposit Agreement on the part of the Issuer or the Escrow Agent to be performed should be determined by a court of competent jurisdiction to be contrary to law, such covenant or agreement shall be deemed and construed to be severable from the remaining covenants and agreements herein contained and shall in no way affect the validity of the remaining provisions of this Escrow Deposit Agreement. 17. Counterparts. This Escrow Deposit Agreement may be executed in several counterparts, all or any of which shall be regarded for all purposes as one original and shall constitute and be but one and the same instrument. I j x Page 5 - Escrow Deposit Agreement Exhibit B j_ IN WITNESS WHEREOF, the parties hereto have each caused this Escrow Deposit Agreement to be executed by their duly authorized officers as of the date first above written. CITY OF TIGARD WASHINGTON COUNTY, OREGON By: Wayne Lowry Acting Finance Director as Escrow Agent By: Authorized Officer Page 6 - Escrow Deposit Agreement - Exhibit B CWCcwc394 APPENDIX A NOTICE OF REDEMPTION STATE OF OREGON CITY OF TIGARD WASHINGTON COUNTY, OREGON GENERAL OBLIGATION CITY BUILDING BONDS, SERIES 1984 The City of Tigard, Washington County, Oregon has called for redemption on , all of its General Obligation City Building Bonds, Series 1984, maturing after June 1, 1994.The Bonds will be due and payable at the office of in Oregon, at a redemption price equal to One Hundred One Percent of their principal amount, plus interest accrued to June 1, 1994. All interest on such Bonds shall cease to accrue after CITY OF TIGARD WASHINGTON COUNTY, OREGON By: Escrow Agent Page 7 - Appendix A to Escrow Deposit Agreement CWCcwc394 Exhibit B