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CERTIFICATE AS TO RESOLUTION AND VOTE I, the undersigned, being the duly qualified and acting recording officer of City of Missoula, Montana (the “City”), hereby certify that the attached resolution is a true copy of a Resolution entitled: “RESOLUTION RELATING TO $3,600,000 TAX INCREMENT URBAN RENEWAL REVENUE BONDS (URBAN RENEWAL DISTRICT II), SERIES 2006; AUTHORIZING THE ISSUANCE AND CALLING FOR THE PUBLIC SALE THEREOF” (the “Resolution”), on file in the original records of the City in my legal custody; that the Resolution was duly adopted by the City Council of the City at a regular meeting on July 10, 2006, and that the meeting was duly held by the City Council and was attended throughout by a quorum, pursuant to call and notice of such meeting given as required by law; and that the Resolution has not as of the date hereof been amended or repealed. I further certify that, upon vote being taken on the Resolution at said meeting, the following Council Members voted in favor thereof: Ballas, Childers, Haines, Hendrickson, Jaffe, Kendall, Marler, Nicholson, Reidy, Rye, Strohmaier, and Wilkins; voted against the same: none; abstained from voting thereon: none; or were absent: none. WITNESS my hand and seal officially this 10th day of July, 2006. (SEAL) Martha L. Rehbein Martha L. Rehbein, City Clerk ---PAGE BREAK--- RESOLUTION NUMBER 7105 RESOLUTION RELATING TO $3,600,000 TAX INCREMENT URBAN RENEWAL REVENUE BONDS (URBAN RENEWAL DISTRICT II), SERIES 2006; AUTHORIZING THE ISSUANCE AND CALLING FOR THE PUBLIC SALE THEREOF BE IT RESOLVED by the City Council (the “Council”) of the City of Missoula, Montana (the “City”), as follows: Section 1. Recitals. 1.01. The Council, pursuant to Ordinance No. 2803 (the “Ordinance”) adopted on December 16, 1991, created its Urban Renewal District II (the “District”) and adopted an urban renewal plan for the District which Plan has been amended by Resolution No. 6533 and Ordinance No. 3215 adopted on July 22, 2002, (the “Urban Renewal District II Plan” or the “Plan”). The Plan, as adopted, contains a tax increment financing provision all as set forth in the Ordinance in accordance with Montana Code Annotated (MCA), Title 7, Chapter 15, Parts 42 and 43, as amended (the “Act”). 1.02. Pursuant to Resolution No. 5210, adopted by the City on September 16, 1991, the Council determined that the Property described therein and commonly known as the Champion Mill Site Property (the “Mill Site Property”) was blighted within the meaning of Title 7, Chapter 15, Parts 42 and 43, M.C.A. 1.03. Resolution No. 5210 further provided that should the Mill Site Property be annexed into the City, it would be annexed to and included in the urban renewal district that was contemplated by Resolution No. 5210 (“Urban Renewal District II”). 1.04. The Missoula Redevelopment Agency (the “MRA”) has determined that the Mill Site Property has experienced continued deterioration due to neglect and vandalism since the Council declared that it was blighted through the adoption of Resolution No. 5210 on December 16, 1991, and that it continues to meet the definition of blight within the meaning of Title 7, Chapter 15, Parts 42 and 43, MCA. 1.05. Upon receipt of a petition signed by all persons with a property right interest in the Mill Site Property and pursuant to Resolution No. 6972, the City has annexed the Mill Site Property to the City and it is now part of Urban Renewal District II. 1.06. Pursuant to Resolution No. 6978, adopted on October 3, 2005, the Council approved the Remediation and Demolition Activities on the Mill Site Property as an Urban Renewal Project and authorized the use of tax increment financing to pay or secure the costs of the Remediation and Demolition Activities. 1.07. On June 12, 2006, the City adopted Resolution No. 7089, A Resolution of Intention Related to the Millsite Revitalization Project Proposed by Millsite Revitalization Project LLC: to Approve the Millsite Revitalization Project as an Urban Renewal Project for Urban Renewal District II; to Set Forth the Council’s Intention to Finance the Purchase of the Idaho Timber Lease through the Issuance of Tax Increment Urban Renewal Revenue Bonds Payable from the Tax Increment of Urban Renewal District II, Exclusive of the Mill Site Property (the URD II Bonds) and to Set Forth the Conditions Therefor; to Preliminarily Approve and Identify the Components of the Financing for Millsite Revitalization Project; Calling a Public Hearing on the Proposed Project and the Issuance of the URD II Bonds, and Authorizing the Negotiation and Finalization of a Development Agreement between the City, the Missoula Redevelopment Agency, and Millsite Revitalization Project to be Presented to the City Council for Public Hearing at a Later Date; and Related Matters (the “Resolution of Intention”). ---PAGE BREAK--- 2 1.08. The option to purchase the Leasehold Interest will expire on September 1, 2006, and the option to purchase the Mill Site Property will expire on December 31, 2007, unless extended. 1.09. The MRP and the MRA have determined that it is in the best interest of the Project and the City that the Leasehold Interest be acquired prior to the termination date of the option. 1.10. Pursuant to Notice of Public Hearing duly given, the City Council conducted a public hearing on the Project and the issuance of bonds payable from the tax increment revenues of Urban Renewal District II, exclusive of certain properties, in an amount not to exceed $3,600,000 for the purpose of acquiring the Leasehold Interest (the “Bonds”). 1.11. Subsequent to the public hearing, the City Council adopted a Resolution Approving the Project. 1.12. MRA staff and representatives of MRP are negotiating and finalizing the terms of an Agreement to Purchase the Idaho Timber Lease to be entered into between the City, MRP, and MRA, and a Sublease and Participation Agreement to be entered into between the City and MRP (collectively, the “City-MRP Lease Agreements”) prior to the sale of the Bonds. It is expected that final drafts of the City-MRP Lease Agreements will be presented to the Council no later than July 10, 2006, and for final approval on July 17, 2006. Section 2. Term of the Bonds. Pursuant to the authority described in Section 1, this Council hereby authorizes the issuance and sale of the Bonds of the City in an aggregate principal amount up to $3,600,000 for the purpose of financing the costs of purchasing the Leasehold Interest and paying costs associated with the sale and issuance of Bonds. The Bonds shall be dated, as originally issued, as of August 1, 2006, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing January 1, 2007, at a rate or rates designated by the successful bidder at public sale and approved by this Council; provided that no rate of interest shall exceed six percent (6.00%) per annum, the difference between the highest and lowest rates of interest shall not exceed one and one-half percent (1.50%) per annum and no supplemental or additional interest shall be permitted. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of The Bonds shall be offered and sold in accordance with the terms and conditions of sale which are set forth on Exhibit A hereto (the “Terms and Conditions of Sale”), which is incorporated by reference and made a part hereof. The Bonds mature serially, subject to redemption as hereinafter provided, on July 1 in each of the following years and amounts (unless combined into one or more term bonds): Year Amount Year Amount 2007 $75,000 2020 $145,000 2008 75,000 2021 150,000 2009 90,000 2022 155,000 2010 95,000 2023 165,000 2011 95,000 2024 170,000 2012 100,000 2025 180,000 2013 105,000 2026 185,000 2014 110,000 2027 195,000 2015 115,000 2028 205,000 2016 120,000 2029 215,000 2017 125,000 2030 225,000 2018 130,000 2031 240,000 2019 135,000 ---PAGE BREAK--- 3 Bidders will have the option of combining the series maturities of the Bonds into one or more term bonds. If any Bonds are issued as term bonds, such term bonds will be subject to annual mandatory sinking fund redemption in the principal amounts in the debt service schedule shown above. The Bonds with stated maturities on or after July 1, 2019 will be subject to redemption on July 1, 2018, and any day thereafter, at the option of the City, in whole or in part, and if in part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, if no designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date. The Bonds shall be issuable only as fully registered bonds and shall be executed by the manual or facsimile signatures of the Mayor, the Finance Director/Treasurer, and the City Clerk. The Bonds shall be issued only in “book entry” form. Section 3. Public Sale. The Bonds shall be sold at a competitive sale which is hereby called and shall be held on July 24, 2006, at 12:30 P.M., M.T. Bids for the Bonds may be submitted by written sealed bids or by electronic transmission through Parity™. The City will receive sealed bids or bids transmitted through ParityTM in accordance with the Terms and Conditions of Sale. The City Finance Director/Treasurer is authorized to reduce the principal amount of the Bonds if he and the Director of the MRA determine it to be appropriate and to modify the terms and conditions accordingly. The City Clerk is hereby authorized and directed to cause notice of the sale to be published, as required by Montana Code Annotated, Sections 7-7-4252 and 17-5-106, in the Missoulian, of Missoula, Montana, once each week for two successive weeks preceding the week which contains the date of sale. The notice of sale shall be published in substantially the form set forth as Exhibit B to this resolution, which is hereby incorporated herein and made a part hereof. Section 4. Official Statement. The Missoula Redevelopment Agency, the Finance Director/Treasurer and other officers of the City, in consultation with Dorsey & Whitney LLP of Missoula, Montana and Minneapolis, Minnesota, as Bond Counsel to the City, are hereby authorized and directed to prepare on behalf of the City an official statement to be distributed to potential purchasers of the Bonds. Such official statement shall contain the Terms and Conditions of Sale and such other information as shall be advisable and necessary to describe accurately the City and the security for, and terms and conditions of, the Bonds. Section 5. City-MRP Lease Agreements. If at any time prior to the July 24, 2006 sale date specified in Section 3 it becomes clear that the City, MRA, and MRP can not agree on the terms of the City–MRP Lease Agreements acceptable to all parties, the City Finance Director/Treasurer, at the request of the Mayor and the Director of the Missoula Redevelopment Agency, may cancel or postpone the sale of the Bonds. If the sale of the Bonds is postponed, the City Finance Director/Treasurer is authorized to make such changes and modifications to the Terms and Conditions and Notice of Sale as may be required. Section 6. Continuing Disclosure. In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 (the “Rule”), the City will covenant and agree, for the benefit of the registered holders and beneficial owners from time to time of the outstanding Bonds, in the resolution prescribing the terms of the Bonds, to provide annual reports of specified information and notice of the occurrence of certain events, if material. The City is the only “obligated person” in respect of the Bonds within the meaning of the Rule for the purposes of disclosing information on an ongoing basis. A description of the undertaking is set forth in the Official Statement. Failure of the City to enter into an undertaking substantially similar to that described in the Official Statement would relieve the successful bidder of its obligation to purchase the Bonds. The City has complied in all material respects with any undertaking previously entered into by it under the Rule. ---PAGE BREAK--- 4 PASSED by the City Council of the City of Missoula, Montana, this 10th day of July, 2006. Attest: Approved: Martha L. Rehbein John Engen Martha L. Rehbein, City Clerk John Engen, Mayor (SEAL) ---PAGE BREAK--- A-1 EXHIBIT A TERMS AND CONDITIONS OF SALE $3,600,000 Tax Increment Urban Renewal Revenue Bonds (Urban Renewal District II), Series 2006 City of Missoula, Montana NOTICE IS HEREBY GIVEN by the City Council (the “Council”) of the City of Missoula, Montana (the “City”), that the City will receive bids for the purchase of Tax Increment Urban Renewal Revenue bonds in the office of the City Clerk, City of Missoula, 435 Ryman Street, Missoula, Montana 59802, in the total principal amount of $3,600,000 (the “Bonds”), until 12:30 P.M., M.T., on July 24, 2006. Bids may be submitted by written sealed bids or by facsimile or electronic transmission through Parity™. The bids will be opened or accessed and tabulated by the City Clerk and presented to the City Council at its regular meeting at 7:00 P.M., M.T., on the same day, in the City Council Chambers, at which time the Council will consider the bids received, and if a responsive and acceptable bid is received, award sale of the Bonds to the responsive bidder whose bid reflects the lowest true interest cost (TIC). Bids may be submitted by facsimile to the City Clerk at (406) 258-4896 or to Springsted Incorporated at (651) 223-3046 until 12:30 P.M., M.T. on Monday, July 24, 2006. THE BONDS The Bonds will bear an original issue date of August 1, 2006, and will bear interest payable semiannually on January 1 and July 1 of each year, commencing January 1, 2007, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) of the immediately preceding month, at a rate or rates designated by the successful bidder at public sale and approved by the Council; provided that no rate of interest shall exceed six percent (6.00%) per annum and the difference between the highest and lowest rates of interest shall not exceed one and one-half percent (1.50%) per annum. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of No supplemental or coupons or additional interest certificates are permitted. All Bonds of the same stated maturity must bear interest from date of original issue until paid at a single, uniform rate. Interest will be calculated on the basis of a 360-day year consisting of twelve 30-day months. The Bonds mature serially, subject to redemption as hereinafter provided, on July 1 in each of the following years and amounts (unless combined into one or more term bonds): Year Amount Year Amount 2007 $75,000 2020 $145,000 2008 75,000 2021 150,000 2009 90,000 2022 155,000 2010 95,000 2023 165,000 2011 95,000 2024 170,000 2012 100,000 2025 180,000 2013 105,000 2026 185,000 2014 110,000 2027 195,000 2015 115,000 2028 205,000 2016 120,000 2029 215,000 2017 125,000 2030 225,000 2018 130,000 2031 240,000 2019 135,000 ---PAGE BREAK--- A-2 Bidders will have the option of combining the series maturities of the Bonds into one or more term bonds. If any Bonds are issued as term bonds, such term bonds will be subject to annual mandatory sinking fund redemption in the principal amounts in the debt service schedule shown above. The Bonds with stated maturities on or after July 1, 2019 will be subject to redemption on July 1, 2018, and any day thereafter, at the option of the City, in whole or in part, and if in part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, if no designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date. The Bonds will be issued as fully registered bonds only and shall be executed by the manual or facsimile signatures of the Mayor, the Finance Director/Treasurer, and the City Clerk. BOOK ENTRY The Bonds will be issued by means of a book entry system with no physical distribution of Bonds made to the public. The Bonds will be issued in fully registered form and one Bond, representing the aggregate principal amount of the Bonds maturing in each year, will be registered in the name of Cede & Co. as nominee of The Depository Trust Company New York, New York, which will act as securities depository of the Bonds. Individual purchases of the Bonds may be made in the principal amount of $5,000 or any multiple thereof of a single maturity, through book entries made on the books and records of DTC and its participants. Principal and interest are payable by the registrar to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to participants of DTC will be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants will be the responsibility of such participants and other nominees of beneficial owners. The purchaser, as a condition of delivery of the Bonds, will be required to deposit the Bonds with DTC. PURPOSE AND SECURITY The Bonds will be issued for the purpose of acquiring the Leasehold Interest of Idaho Timber in the Champion Mill Site Property, and paying costs associated with the sale and issuance of the Bonds, in accordance with the provisions of Montana Code Annotated, Title 7, Chapter 7, Parts 42 and 43, as amended. The Bonds are equally and ratably secured by a first lien upon and pledge of the Tax Increment of Urban Renewal District II. The Bonds do not constitute a general obligation or a pledge of other taxing power or the general credit of the City or any other Taxing Body. Bidders should consult a copy of the Preliminary Official Statement for a discussion of the security for the Bonds and the form of opinion of bond counsel relating to the Bonds. CONTINUING DISCLOSURE In order to permit bidders for the Bonds and other participating underwriters in the primary offering of the Bonds to comply with paragraph of Rule 15c2-12 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 (the “Rule”), the City will covenant and agree, for the benefit of the registered holders and beneficial owners from time to time of the outstanding Bonds, in the resolution prescribing the terms of the Bonds, to provide annual reports of specified information and notice of the occurrence of certain events, if material. The City is the only “obligated person” in respect of the Bonds within the meaning of the Rule for the purposes of disclosing information on an ongoing basis. A description of the undertaking is set forth in the Official Statement. Failure of the City to enter into an undertaking substantially similar to that described in the Official Statement would relieve the successful bidder of its obligation to purchase the Bonds. The City has complied in all material respects with any undertaking previously entered into by it under the Rule. BIDDING AND SALE PROCEDURES ---PAGE BREAK--- A-3 Submission of Bids. Bids must be on the Official Bid form, a copy of which may be obtained from the Financial Advisor and enclosed in a sealed envelope marked as follows: “Bid for $3,600,000 Tax Increment Urban Renewal Revenue Bonds (Urban Renewal District II), Series 2006, City of Missoula, Montana” and delivered to the City Clerk. Each envelope when delivered must indicate on the outside the name and address of the bidder, or in the case of a group of bidders, of the representative. Basis of Award. The Bonds will be sold for not less than $3,553,200 with accrued interest to the date of delivery, and all bidders must state the lowest rate or rates of interest at which they will purchase the Bonds at par. Bids will be compared on the basis of true interest cost (TIC). The TIC is the effective interest cost of the Bonds based on bond proceeds received at closing calculated from the dated date of the Bonds. In the event that two or more bids state the lowest true interest cost, the sale of the Bonds will be awarded by lot. The Council reserves the right to reject any and all bids and to sell the Bonds at private sale and to waive any informality and irregularity in any and all bids. Bidders must bid for all or none of the Bonds. Each bid must be unconditional (or conditioned on only those items specified in these Official Terms and Conditions of Sale). No bid may be altered or withdrawn after the time specified above for opening bids without the express consent of the Council. Electronic Transmission. To the extent any instructions or directions set forth in ParityTM conflict with these Terms and Conditions of Sale, the terms of these Terms and Conditions of Sale shall control. For further information about ParityTM, potential bidders may contact the Financial Advisor, Springsted Incorporated at (651) 223-3000 (Bond Services), or ParityTM at (212) 404-8102 (Client Services). In the event of a malfunction in the electronic bidding process, bidders may submit their bids by sealed bid including facsimile transmission to the City Clerk, Martha Rehbein, at facsimile number (406) 258-4896 (phone (406) 522-6078) or to Springsted Incorporated at facsimile number (651) 223- 3046 (phone (651) 223-3000). Good Faith Deposit. A good faith deposit (the “Deposit”) in the form of money, cashier’s check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federal Deposit Insurance Corporation or a financial surety bond in the sum of $72,000 payable to the order of the City of Missoula, Montana is required for each bid to be considered. If money, cashier’s check, certified check, bank money order, or bank draft is used, it must accompany each bid and be delivered to the City Clerk. If a financial surety bond is used, it must be from an insurance company licensed and qualified to issue such a bond in the State of Montana and such bond must be submitted to the City Clerk, or the City’s financial advisor prior to the opening of the bids. The financial surety bond must identify each bidder whose Deposit is guaranteed by such financial surety bond. If the Bonds are awarded to a bidder utilizing a financial surety bond, then that purchaser is required to submit its Deposit to the City in the form of a cashier’s check (or wire transfer such amount as instructed by the City or its financial advisor) not later than 1:00 P.M., M.T., on the next business day following the award. If such Deposit is not received by that time, the financial surety bond may be drawn by the City to satisfy the Deposit requirement. No interest on the Deposit will accrue to the purchaser. The Deposit will be applied to the purchase price of the Bonds. In the event the purchaser fails to honor its accepted bid, the Deposit will be retained by the City. The Deposit of the unsuccessful bidders will be returned immediately on award of sale of the Bonds or after rejection of all bids. Instructions for wiring a Deposit may be obtained from the City’s Financial Advisor, Springsted Incorporated, 380 Jackson Street, Suite 300, St. Paul, Minnesota 55101-2887, (651) 223- 3000. BOND REGISTRAR, TRANSFER AGENT AND PAYING AGENT The City will designate and contract with a suitable bank or trust company to act as bond registrar, transfer agent and paying agent (the “Registrar”). The bond register will be kept, transfers of ownership will be effected and principal of and interest on the Bonds will be paid by the Registrar. The ---PAGE BREAK--- A-4 City will pay the charges of the Registrar for such services. The City reserves the right to remove the Registrar and to appoint a successor. LEGAL OPINION An opinion as to the validity of the Bonds and the exclusion from gross income for federal and Montana income tax purposes of the interest thereon will be furnished by Dorsey & Whitney LLP, of Missoula, Montana, and Minneapolis, Minnesota, as Bond Counsel. The legal opinion will be delivered at the time of closing. The legal opinion will state that the Bonds are valid and binding Tax Increment Urban Renewal Revenues of the City enforceable in accordance with their terms, except to the extent to which enforceability thereof may be limited by the exercise of judicial discretion or by state or federal laws relating to bankruptcy, reorganization, moratorium or creditors’ rights. DELIVERY Within 30 days after the sale, the City will deliver to the Registrar the printed Bonds ready for completion and authentication. The original purchaser of the Bonds must notify the Registrar, at least five business days before issuance of the Bonds, of the persons in whose names the Bonds will be initially registered and the denominations of the Bonds to be originally issued. If notification is not received by that date, the Bonds will be registered in the name of the original purchaser and will be issued in denominations corresponding to the principal maturities of the Bonds. On the day of closing, the City will furnish to the purchaser the opinion of Bond Counsel described above, an arbitrage certification and a certificate stating that no litigation in any manner questioning the validity of the Bonds is then pending or, to the best knowledge of officers of the City, threatened. Payment for the Bonds must be received by the City in immediately available funds at its designated depositary on the day of closing. The successful bidder shall submit to the Finance Director/Treasurer not earlier than 48 hours after the award of sale and not later than the date of closing a certificate, in form satisfactory to Bond Counsel, as to the initial reoffering prices of each stated maturity of the Bonds and stating that at least ten percent of the principal amount of the Bonds of each stated maturity has been sold at such prices. OFFICIAL STATEMENT The City will prepare an Official Statement relating to the Bonds which the City will deem to be final as of its date. The City will deliver, at closing, a certificate executed by the Mayor, the Finance Director/Treasurer, and the City Clerk to the effect that, to the best of their knowledge, as of the date of closing, the information contained in the Official Statement, including any supplement thereto, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading; provided that no comment will be made with respect to any information provided by the successful bidder for inclusion in any supplement to the Official Statement. By submitting a bid for the Bonds, the successful bidder agrees: to disseminate to all members of the underwriting syndicate copies of the Official Statement, including any supplements prepared by the City, to file a copy of the Official Statement, including any supplement prepared by the City, with a nationally recognized municipal securities repository, and to take any and all other actions necessary to comply with applicable rules of the Securities and Exchange Council and the Municipal Securities Rulemaking Board governing the offering, sale and delivery of the Bonds to ultimate purchasers. Within seven business days after the sale the City will furnish to the successful bidder without charge 100 copies of the final Official Statement relating to the Bonds. The successful bidder must notify the Finance Director/Treasurer in writing within two business days after the award of sale of the Bonds if it requires additional copies of the Official Statement. The cost of additional copies shall be paid by the successful bidder. ---PAGE BREAK--- A-5 COSTS; CUSIP NUMBERS The City will pay for the cost of bond counsel opinion, and the fees and charges of the Registrar. The City will apply for CUSIP numbers but will assume no cost or obligation for the printing of CUSIP numbers on the Bonds or for the correctness of any numbers printed thereon. BY ORDER OF THE CITY COUNCIL City Clerk ---PAGE BREAK--- B-1 EXHIBIT B NOTICE OF BOND SALE $3,600,000 Tax Increment Urban Renewal Revenue Bonds (Urban Renewal District II), Series 2006 City of Missoula, Montana NOTICE IS HEREBY GIVEN that the City Council (the “Council”) of the City of Missoula, Montana (the “City”), will receive bids for the purchase of $3,600,000 Tax Increment Urban Renewal Revenue Bonds (Urban Renewal District II), Series 2006 (the “Bonds”) at the office of the City Clerk, City of Missoula, 435 Ryman, Missoula, Montana, until 12:30 P.M., M.T., on July 24, 2006. Bids for the purchase of the Bonds may be submitted as written sealed bids or by facsimile or electronic transmission through Parity™. The bids will be opened or accessed and tabulated by the City Clerk and presented to the Council at its regular meeting at 7:00 P.M., M.T., on the same day in the City Council Chambers. The Bonds will be awarded to the responsive bidder whose bid reflects the lowest true interest cost (TIC). Bids may be submitted by facsimile to the City Clerk at (406) 258-4896 or to Springsted Incorporated at (651) 223-3046 until 12:30 P.M., M.T. on Monday, July 24, 2006. The Bonds mature serially, subject to redemption as hereinafter provided, on July 1 in each of the following years and amounts (unless combined into one or more term bonds): Year Amount Year Amount 2007 $75,000 2020 $145,000 2008 75,000 2021 150,000 2009 90,000 2022 155,000 2010 95,000 2023 165,000 2011 95,000 2024 170,000 2012 100,000 2025 180,000 2013 105,000 2026 185,000 2014 110,000 2027 195,000 2015 115,000 2028 205,000 2016 120,000 2029 215,000 2017 125,000 2030 225,000 2018 130,000 2031 240,000 2019 135,000 Bidders will have the option of combining the series maturities of the Bonds into one or more term bonds. If any Bonds are issued as term bonds, such term bonds will be subject to annual mandatory sinking fund redemption in the principal amounts in the debt service schedule shown above. The Bonds will be issued in “book entry” only form. ---PAGE BREAK--- B-2 The Bond shall be issuable as fully registered bonds only, shall bear an original issue date of August 1, 2006, and shall bear interest payable semiannually on January 1 and July 1 of each year, commencing January 1, 2007, to the registered owners of the Bonds as such appear in the bond register as of the close of business on the 15th day (whether or not a business day) of the immediately preceding month. No interest rate may exceed six percent (6.00%) per annum, and the difference between the highest and lowest rate of interest may not exceed one and one-half percent (1.50%) per annum. Each rate must be expressed in an integral multiple of 1/8 or 5/100 of No supplemental or coupons or additional interest certificates are permitted. The Bonds with stated maturities on or after July 1, 2019 will be subject to redemption on July 1, 2018, and any day thereafter, at the option of the City, in whole or in part, and if in part from such stated maturities and in such principal amounts as the City may designate in writing to the Registrar (or, if no designation is made, in inverse order of maturities and within a stated maturity in $5,000 principal amounts selected by the Registrar by lot or other manner it deems fair), at a redemption price equal to the principal amount thereof to be redeemed plus interest accrued to the redemption date The Bonds will be sold for not less than $3,553,200 with accrued interest on the principal amount of the Bonds to the date of their delivery. The Council reserves the right to reject any and all bids and to sell the Bonds at private sale. A good faith deposit in the form of money, cashier’s check, certified check, bank money order, or bank draft drawn and issued by a federally chartered or state chartered bank insured by the Federal Deposit Insurance Corporation or a financial surety bond in the sum of $76,000.00 payable to the order of the City of Missoula, Montana, is required for each bid to be considered, as further specified in the Official Terms and Conditions of Sale. Copies of a statement of the Official Terms and Conditions of Sale and additional information may be obtained from Springsted Incorporated, 380 Jackson Street, Suite 300, St. Paul, Minnesota 55101-2887, (651) 223-3000. Prospective bidders should consult the Official Terms and Conditions of Sale and the Preliminary Official Statement for a description of the Bonds, the security therefor, and the form of legal opinion proposed to be rendered by Dorsey & Whitney LLP, of Missoula, Montana, as bond counsel. Dated: , 2006. BY ORDER OF THE CITY COUNCIL City Clerk City of Missoula, Montana Publish: July 11, 2006 July 18, 2006