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SPECIAL PUBLIC WORKS FUND DEVELOPMENT PROJECT INTERIM FINANCING CONTRACT
Project Name: Alder Creek Water Treatment Plant: Water Treatment Improvements
Project Number: B24004
This interim financing contract (“Contract”), dated as of the date the Contract is fully executed, is made by the State of Oregon, acting by and through its Oregon Infrastructure Finance Authority of the Oregon
Business Development Department (“OBDD”), and the City of Sandy (“Recipient”) for financing of the
project referred to above and described in Exhibit C (“Project”). This Contract becomes effective only when fully signed and approved as required by applicable law. Capitalized terms not defined in section 1 and elsewhere in the body of the Contract have the meanings assigned to them by Exhibit A.
This Contract includes the following exhibits, listed in descending order of precedence for purposes of resolving any conflict between two or more of the parts:
Exhibit A General Definitions Exhibit B Security Exhibit C Project Description Exhibit D Project Budget
SECTION 1 - KEY TERMS
The following capitalized terms have the meanings assigned below.
“Estimated Project Cost” means $9,500,000.
“Interest Rate” means 3.02% per annum.
“Loan Amount” means $9,500,000.
“Maturity Date” means the earlier of 3 years plus 90 days after the date of this Contract, or the receipt of Refunding Proceeds by either party.
“Project Closeout Deadline” means 90 days after the earlier of the Project Completion Date or the
Project Completion Deadline.
“Project Completion Deadline” means 36 months after the date of this Contract.
SECTION 2 - FINANCIAL ASSISTANCE
OBDD shall provide Recipient, and Recipient shall accept from OBDD, financing for the Project a non-revolving loan (the “Loan”) in an aggregate principal amount not to exceed the Loan Amount.
Notwithstanding the above, the aggregate total of Financing Proceeds disbursed under this
Contract cannot exceed the Costs of the Project.
SECTION 3 - DISBURSEMENTS
A.Reimbursement Basis. The Financing Proceeds will be disbursed to Recipient on an expensereimbursement or costs-incurred basis. Recipient must submit each disbursement request for theFinancing Proceeds on an OBDD-provided or OBDD-approved disbursement request form
(“Disbursement Request”).
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B.Financing Availability. OBDD’s obligation to make, and Recipient’s right to request, disbursementsunder this Contract terminates on the Project Closeout Deadline.
C.Payment to Contractors. OBDD, in its sole discretion, may make direct payment to suppliers,contractors and subcontractors and others for sums due them in connection with construction of the
Project, instead of reimbursing Recipient for those sums.
SECTION 4 - LOAN PAYMENT; PREPAYMENT
A.Promise to Pay. Recipient shall repay the Loan and all amounts due under this Contract in
accordance with its terms. Payments required under this Contract are, without limitation, payable
from the sources of repayment described in the Act and this Contract, including but not limited to
Exhibit B, and the obligation of Recipient to make all payments is absolute and unconditional.Payments will not be abated, rebated, set-off, reduced, abrogated, terminated, waived, postponed orotherwise modified in any manner whatsoever. Payments cannot remain unpaid, regardless of anycontingency, act of God, event or cause whatsoever, including (without limitation) any acts or
circumstances that may constitute failure of consideration, eviction or constructive eviction, thetaking by eminent domain or destruction of or damage to the Project, commercial frustration ofpurpose, any change in the laws, rules or regulations of the United States of America or of the Stateof Oregon or any political subdivision or governmental authority, nor any failure of OBDD to
perform any agreement, whether express or implied, or any duty, liability, or obligation arising out
of or connected with the Project or this Contract, or any rights of set off, recoupment, abatement or
counterclaim that Recipient might otherwise have against OBDD or any other party or parties;provided further, that payments hereunder will not constitute a waiver of any such rights.
B.Interest. Interest accrues at the Interest Rate on each disbursement from the date of disbursementuntil the Loan is fully paid. Interest is computed by counting the actual days occurring in a 360-day
year.
Recipient authorizes OBDD to calculate interest accrued under the Loan, including as necessary todetermine the loan amortization schedule, a loan prepayment, or a loan payoff amount. Absentmanifest error, such calculations will be conclusive.
C.Loan Payment. The entire outstanding balance of the Loan, including all accrued unpaid interest, is
due and payable in full on the Maturity Date.
D.Loan Prepayments.
(1)Mandatory Prepayment. The Refunding Proceeds shall be applied to repay the outstandingbalance of the Contract. Further, Recipient shall prepay all or part of the outstanding balance ofthe Loan as may be required by this Contract.
(2)Optional Prepayment. Recipient may prepay all or part of the outstanding balance of the Loanon any day except a Saturday, Sunday, legal holiday or day that banking institutions in Salem,Oregon are closed.
E.Application of Payments. Regardless of any designation by Recipient, payments and prepayments by
Recipient under this Contract or any of the Financing Documents will be applied first to any
expenses of OBDD, including but not limited to attorneys’ fees, then to unpaid accrued interest (inthe case of prepayment, on the amount prepaid), then to the principal of the Loan. In the case of aLoan prepayment that does not prepay all the principal of the Loan, OBDD will determine, in its solediscretion, the method for how the Loan prepayment will be applied to the outstanding principal
payments. A scheduled payment received before the scheduled repayment date will be applied to
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interest and principal on the scheduled repayment date, rather than on the day such payment is received.
SECTION 5 - CONDITIONS PRECEDENT
A.Conditions Precedent to OBDD’s Obligations. OBDD’s obligations are subject to the receipt of the
following items, in form and substance satisfactory to OBDD and its Counsel:
(1)This Contract duly signed by an authorized officer of Recipient.
(2)A copy of the ordinance, order or resolution of the governing body of Recipient authorizing the
borrowing and the contemplated transactions and the execution and delivery of this Contract
and the other Financing Documents.
(3)An opinion of Recipient’s Counsel.
(4)Such other certificates, documents, opinions and information as OBDD may reasonablyrequire.
B.Conditions to Disbursements. As to any disbursement, OBDD has no obligation to disburse funds
unless all following conditions are met:
(1) There is no Event of Default.
(2)The representations and warranties made in this Contract are true and correct on the date ofdisbursement as if made on such date.
(3)OBDD, in the reasonable exercise of its administrative discretion, has sufficient moneys in the
Special Public Works Fund for use in the Project and has sufficient funding, appropriations,
limitations, allotments and other expenditure authority to make the disbursement.
(4)Recipient has delivered to OBDD (in form and substance satisfactory to OBDD) an estimatedschedule of Disbursement Requests for Project design, including anticipated number,submission dates, and amounts and, prior to the beginning of Project construction, an estimated
schedule of Disbursement Requests for construction, including anticipated number, submission
dates, and amounts.
(5)OBDD (a) has received a completed Disbursement Request, (b) has received any writtenevidence of materials and labor furnished to or work performed upon the Project, itemizedreceipts or invoices for payment, and releases, satisfactions or other signed statements or forms
as OBDD may require, (c) is satisfied that all items listed in the Disbursement Request are
reasonable and that the costs for labor and materials were incurred and are properly included inthe Costs of the Project, and (d) has determined that the disbursement is only for costs definedas eligible costs under the Act and any implementing administrative rules and policies.
(6)Recipient has delivered documentation satisfactory to OBDD that, in addition to the Financing
Proceeds, Recipient has available or has obtained binding commitments for all funds necessary
to complete the Project.
(7)Any conditions to disbursement elsewhere in this Contract or in the other FinancingDocuments are met.
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SECTION 6 - USE OF FINANCIAL ASSISTANCE
A.Use of Proceeds. Recipient shall use the Financing Proceeds only for the activities described inExhibit C and according to the budget in Exhibit D. Recipient may not transfer Financing Proceeds
among line items in the budget without the prior written consent of OBDD.
B.Costs of the Project. Recipient shall apply the Financing Proceeds to the Costs of the Project inaccordance with the Act and Oregon law, as applicable. Financing Proceeds cannot be used for costsin excess of one hundred percent (100%) of the total Costs of the Project and cannot be used for pre-Award Costs of the Project, unless permitted by Exhibit C.
C.Costs Paid for by Others. Recipient may not use any of the Financing Proceeds to cover costs to be
paid for by other financing for the Project, whether from OBDD or from another State of Oregonagency or any third party.
SECTION 7 - REPRESENTATIONS AND WARRANTIES OF RECIPIENT
Recipient represents and warrants to OBDD:
A.Estimated Project Cost, Funds for Repayment. A reasonable estimate of the Costs of the Project is
shown in section 1, and the Project is fully funded. Recipient will have adequate funds available to
repay the Loan, and the Maturity Date does not exceed the usable life of the Project.
B.Organization and Authority.
(1)Recipient is a Municipality under the Act, and validly organized and existing under the laws ofthe State of Oregon.
(2)Recipient has all necessary right, power and authority under its organizational documents andunder Oregon law to (a) execute and deliver this Contract and the other Financing Documents,(b) incur and perform its obligations under this Contract and the other Financing Documents,and (c) borrow and receive financing for the Project.
(3)This Contract and the other Financing Documents executed and delivered by Recipient have
been authorized by an ordinance, order or resolution of Recipient’s governing body, and voterapproval, if necessary, that was adopted in accordance with applicable law and requirementsfor filing public notices and holding public meetings.
(4)This Contract and the other Financing Documents have been duly executed by Recipient, andwhen executed by OBDD, are legal, valid and binding, and enforceable in accordance with
their terms.
C.Full Disclosure. Recipient has disclosed in writing to OBDD all facts that materially adversely affectthe Project, or the ability of Recipient to make all payments and perform all obligations required bythis Contract and the other Financing Documents. Recipient has made no false statements of fact,
nor has it omitted information necessary to prevent any statements from being misleading. The
information contained in this Contract and the other Financing Documents is true and accurate in all
respects.
D.Pending Litigation. Recipient has disclosed in writing to OBDD all proceedings pending (or to theknowledge of Recipient, threatened) against or affecting Recipient, in any court or before anygovernmental authority or arbitration board or tribunal, that, if adversely determined, would
materially adversely affect the Project or the ability of Recipient to make all payments and perform
all obligations required by this Contract and the other Financing Documents.
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E.No Events of Default.
(1) No Events of Default exist or occur upon authorization, execution or delivery of this Contract
or any of the Financing Documents.
(2)Recipient has not violated, and has not received notice of any claimed violation of, anyagreement or instrument to which it is a party or by which the Project or its property may bebound, that would materially adversely affect the Project or the ability of Recipient to make all
payments and perform all obligations required by this Contract and the other Financing
Documents.
F.Compliance with Existing Agreements and Applicable Law. The authorization and execution of, andthe performance of all obligations required by, this Contract and the other Financing Documents willnot: (i) cause a breach of any agreement, indenture, mortgage, deed of trust, or other instrument, towhich Recipient is a party or by which the Project or any of its property or assets may be bound; (ii)
cause the creation or imposition of any third party lien, charge or encumbrance upon any property orasset of Recipient; (iii) violate any provision of the charter or other document pursuant to whichRecipient was organized or established; or (iv) violate any laws, regulations, ordinances, resolutions,or court orders related to Recipient, the Project or its properties or operations.
G.Governmental Consent. Recipient has obtained or will obtain all permits and approvals, and has
made or will make all notifications, declarations, filings or registrations, required for the making andperformance of its obligations under this Contract and the other Financing Documents, for thefinancing or refinancing and undertaking and completion of the Project.
SECTION 8 - COVENANTS OF RECIPIENT
Recipient covenants as follows:
A.Notice of Adverse Change. Recipient shall promptly notify OBDD of any adverse change in the
activities, prospects or condition (financial or otherwise) of Recipient or the Project related to theability of Recipient to make all payments and perform all obligations required by this Contract or the
other Financing Documents.
B.Compliance with Laws. Recipient shall comply with all applicable laws, rules, regulations and
orders of any court or governmental authority that relate to this Contract or the other Financing
Documents, and the Project and the operation of the System of which the Project is a component. In
particular, but without limitation, Recipient shall comply with the following, as applicable:
(1)State procurement regulations found in the Oregon Public Contracting Code, ORS chapters279A, 279B and 279C.
(2)State labor standards and wage rates found in ORS chapter 279C.
(3)OAR 123-042-0165 (5) requirements for signs and notifications.
These laws, rules, regulations and orders are incorporated by reference in this Contract to the extent required by law.
C.Project Completion Obligations. Recipient shall:
(1) Provide OBDD with copies of all plans and specifications relating to the Project, and a timeline
for the bidding/award process, at least ten (10) days before advertising for bids.
(2)Provide a copy of the bid tabulation, notice of award, and contract to OBDD within ten (10)days after selecting a construction contractor.
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(3)Permit OBDD to conduct inspection of the Project at any time.
(4)Complete the Project using its own fiscal resources or money from other sources to pay for any
Costs of the Project in excess of the total amount of financial assistance provided pursuant to
this Contract.
(5)Complete the Project no later than the Project Completion Deadline, unless otherwisepermitted by OBDD in writing.
(6) Obtain and maintain as-built drawings for all facilities constructed as part of the Project.
D.Ownership of Project. During the term of the Loan, the Project is and will continue to be owned byRecipient. The Project will be operated by Recipient or by a person under a management contract oroperating agreement with Recipient.
E.Operation and Maintenance of the Project. Recipient shall operate and maintain the Project in goodrepair and operating condition so as to preserve the long term public benefits of the Project,
including making all necessary and proper repairs, replacements, additions, and improvementsduring term of the Loan. On or before the Project Closeout Deadline, Recipient shall adopt a planacceptable to OBDD for the on-going operation and maintenance of the Project without reliance onOBDD financing and furnish OBDD, at its request, with evidence of such adoption. The plan must
include measures for generating revenues sufficient to assure the operation and maintenance of the
Project during the usable life of the Project.
F.Insurance, Damage. Recipient shall maintain, or cause to be maintained, insurance policies withresponsible insurers or self-insurance programs, insuring against liability and risk of direct physicalloss, damage or destruction of the Project, at least to the extent that similar insurance is customarilycarried by governmental units constructing, operating and maintaining similar facilities. Nothing in
this provision precludes Recipient from asserting a defense against any party other than OBDD,including a defense of immunity. If the Project or any portion is destroyed, any insurance proceedswill be paid to OBDD and applied to prepay the outstanding balance on the Loan in accordance withsection 4.D.(1), unless OBDD agrees in writing that the insurance proceeds may be used to rebuild
the Project.
G.Sales, Leases and Encumbrances. Except as specifically described in Exhibit D, Recipient shall notsell, lease, exchange, abandon, transfer or otherwise dispose of any substantial portion of or interestin the Project or any system that provides revenues for payment or is security for the Loan, unlessworn out, obsolete, or, in the reasonable business judgment of Recipient, no longer useful in theoperation of the Project. Nevertheless, OBDD may consent to such disposition if it has received 90
days’ prior written notice from Recipient. Such consent may require assumption by transferee of allof Recipient’s obligations under the Financing Documents and payment of OBDD’s costs related tosuch assumption. In the case of sale, exchange, transfer or other similar disposition, Recipient shall,within 30 days of receipt of any proceeds from such disposition, prepay the entire outstanding
balance on the Loan in accordance with section 4.D.(1), unless OBDD agrees otherwise in writing. If
Recipient abandons the Project, Recipient shall prepay the entire outstanding balance of the Loan
immediately upon demand by OBDD.
H.Condemnation Proceeds. If the Project or any portion is condemned, any condemnation proceedswill be paid to OBDD and applied to prepay the outstanding balance of the Loan in accordance withsection 4.D.(1).
I.Financial Records. Recipient shall keep accurate books and records for the revenues and funds thatare the source of repayment of the Loan, separate and distinct from its other books and records, andmaintain them according to generally accepted accounting principles established by the Government
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Accounting Standards Board in effect at the time. Recipient shall have these records audited annually by an independent certified public accountant, which may be part of the annual audit of all
records of Recipient.
J.Inspections; Information. Recipient shall permit OBDD and any party designated by OBDD: (i) toinspect, at any reasonable time, the property, if any, constituting the Project; and (ii) at anyreasonable time, to inspect and make copies of any accounts, books and records, including, without
limitation, its records regarding receipts, disbursements, contracts, investments and any other related
matters, and financial statements or other documents related to its financial standing. Recipient shallsupply any related reports and information as OBDD may reasonably require. In addition, Recipientshall, upon request, provide OBDD with copies of loan documents or other financing documents andany official statements or other forms of offering prospectus relating to any other bonds, notes orother indebtedness of Recipient that are issued after the date of this Contract.
K.Records Maintenance. Recipient shall retain and keep accessible all books, documents, papers, andrecords that are directly related to this Contract, the Project or the Financing Proceeds for aminimum of six years, or such longer period as may be required by other provisions of this Contractor applicable law, following the Project Closeout Deadline. If there are unresolved issues at the end
of such period, Recipient shall retain the books, documents, papers and records until the issues are
resolved.
L.Economic Benefit Data. OBDD may require Recipient to submit specific data on the economicdevelopment benefits of the Project and other information to evaluate the success and economicimpact of the Project, from the date of this Contract until six years after the Project CompletionDate. Recipient shall, at its own expense, prepare and submit the data within the time specified by
OBDD.
M.Disadvantaged Business Enterprises. ORS 200.090 requires all public agencies to “aggressivelypursue a policy of providing opportunities for disadvantaged business enterprises, minority-ownedbusinesses, woman-owned businesses, businesses that service-disabled veterans own and emerging
small businesses...” OBDD encourages Recipient in any contracting activity to follow good faith
efforts as described in ORS 200.045, available athttps://www.oregonlegislature.gov/bills_laws/ors/ors200.html. Additional resources are provided bythe Governor’s Policy Advisor for Economic and Business Equity. Also, the Certification Office forBusiness Inclusion and Diversity at the Oregon Business Development Department maintains a listof certified firms and can answer questions. Search for certified MWESB firms on the web at:
https://oregon4biz.diversitysoftware.com/FrontEnd/SearchCertifiedDirectory.asp?XID=2315&TN=o
regon4biz.
N.Professional Responsibility. A professional engineer or architect, as applicable, registered and ingood standing in Oregon, will be responsible for the design and construction of the Project. All
service providers retained for their professional expertise must be certified, licensed, or registered, as
appropriate, in the State of Oregon for their specialty. Recipient shall follow standard constructionpractices, such as bonding requirements for construction contractors, requiring errors and omissionsinsurance, and performing testing and inspections during construction.
O.Notice of Default. Recipient shall give OBDD prompt written notice of any Default as soon asRecipient becomes aware of its existence or reasonably believes a Default is likely.
P.Contributory Liability and Contractor Indemnification.
(1) If any third party makes any claim or brings any action, suit or proceeding alleging a tort asnow or hereafter defined in ORS 30.260 (“Third Party Claim”) against a party (the “NotifiedParty”) with respect to which the other party may have liability, the Notified Party must
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promptly notify the other party in writing and deliver a copy of the claim, process, and all legal pleadings related to the Third Party Claim. Either party is entitled to participate in the defense
of a Third Party Claim, and to defend a Third Party Claim with counsel of its own choosing. The foregoing provisions are conditions precedent for either party’s liability to the other in regards to the Third Party Claim.
If the parties are jointly liable (or would be if joined in the Third Party Claim), the parties shall
contribute to the amount of expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred and paid or payable in such proportion as is appropriate to reflect their respective relative fault. The relative fault of the parties shall be determined by reference to, among other things, the parties' relative intent, knowledge, access to information and opportunity to correct or prevent the circumstances resulting in such expenses, judgments, fines or settlement amounts. Each party’s contribution amount in any
instance is capped to the same extent it would have been capped under Oregon law if that party
had sole liability in the proceeding. This Section shall survive termination of this Contract.
(2) Recipient shall take all reasonable steps to require its contractor(s) that are not units of localgovernment as defined in ORS 190.003, if any, to indemnify, defend, save and hold harmless
the State of Oregon and its officers, employees and agents (“Indemnitee”) from and against any
and all claims, actions, liabilities, damages, losses, or expenses (including attorneys’ fees)arising from a tort (as now or hereafter defined in ORS 30.260) caused, or alleged to be caused,in whole or in part, by the negligent or willful acts or omissions of Recipient’s contractor orany of the officers, agents, employees or subcontractors of the contractor (“Claims”). It is thespecific intention of the parties that the Indemnitee shall, in all instances, except for Claims
arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnifiedby the contractor from and against any and all Claims. This Section shall survive terminationof this Contract.
Q.Further Assurances. Recipient shall, at the request of OBDD, authorize, sign, acknowledge and
deliver any further resolutions, conveyances, transfers, assurances, financing statements and other
instruments and documents as may be necessary or desirable for better assuring, conveying,granting, assigning and confirming the rights, security interests and agreements granted or intendedto be granted by this Contract and the other Financing Documents.
SECTION 9 - DEFAULTS
Any of the following constitutes an “Event of Default”:
A.Recipient fails to make any Loan payment when due.
B.Recipient fails to make, or cause to be made, any required payments of principal, redemptionpremium, or interest on any bonds, notes or other material obligations, for any other loan made bythe State of Oregon.
C.Any false or misleading representation is made by or on behalf of Recipient in this Contract, in any
other Financing Document or in any document provided by Recipient related to this Loan or the
Project.
D.(1) A petition, proceeding or case is filed by or against Recipient under any federal or state
bankruptcy or insolvency law, and in the case of a petition filed against Recipient, Recipient
acquiesces to such petition or such petition is not dismissed within 20 calendar days after such filing, or such dismissal is not final or is subject to appeal;
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(2)Recipient files a petition seeking to take advantage of any other law relating to bankruptcy,insolvency, reorganization, liquidation, dissolution, winding-up or composition or adjustment
of debts;
(3)Recipient becomes insolvent or bankrupt or admits its inability to pay its debts as they becomedue, or makes an assignment for the benefit of its creditors;
(4)Recipient applies for or consents to the appointment of, or taking of possession by, a custodian
(including, without limitation, a receiver, liquidator or trustee) of Recipient or any substantial
portion of its property; or
(5)Recipient takes any action for the purpose of effecting any of the above.
E.Recipient defaults under any other Financing Document and fails to cure such default within theapplicable grace period.
F.Recipient fails to perform any obligation required under this Contract, other than those referred to insubsections A through E of this section 9, and that failure continues for a period of 30 calendar daysafter written notice specifying such failure is given to Recipient by OBDD. OBDD may agree inwriting to an extension of time if it determines Recipient instituted and has diligently pursued
corrective action.
SECTION 10 - REMEDIES
A.Remedies. Upon any Event of Default, OBDD may pursue any or all remedies in this Contract orany other Financing Document, and any other remedies available at law or in equity to collectamounts due or to become due or to enforce the performance of any obligation of Recipient.
Remedies may include, but are not limited to:
(1) Terminating OBDD’s commitment and obligation to make any further disbursements ofFinancing Proceeds under the Contract.
(2)Declaring all payments under the Contract and all other amounts due under any of theFinancing Documents immediately due and payable, and upon notice to Recipient the same
become due and payable without further notice or demand.
(3) Barring Recipient from applying for future awards.
(4) Withholding amounts otherwise due to Recipient for application to the payment of amountsdue under this Contract, including as provided in ORS 285B.449.
(5) Foreclosing liens or security interests pursuant to this Contract or any other Financing
Document.
B.Application of Moneys. Any moneys collected by OBDD pursuant to section 10.A will be appliedfirst, to pay any attorneys’ fees and other fees and expenses incurred by OBDD; then, to pay interestdue on the Loan; then, to pay principal due on the Loan; and last, to pay any other amounts due andpayable under this Contract or any of the Financing Documents.
C.No Remedy Exclusive; Waiver; Notice. No remedy available to OBDD is intended to be exclusive,and every remedy will be in addition to every other remedy. No delay or omission to exercise anyright or remedy will impair or is to be construed as a waiver of such right or remedy. No single orpartial exercise of any right power or privilege under this Contract or any of the Financing
Documents will preclude any other or further exercise thereof or the exercise of any other such right,power or privilege. OBDD is not required to provide any notice in order to exercise any right or
remedy, other than notice required in section 9 of this Contract.
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D.Default by OBDD. In the event OBDD defaults on any obligation in this Contract, Recipient’sremedy will be limited to injunction, special action, action for specific performance, or other
available equitable remedy for performance of OBDD’s obligations.
SECTION 11 - MISCELLANEOUS
A.Time is of the Essence. Recipient agrees that time is of the essence under this Contract and the otherFinancing Documents.
B.Relationship of Parties; Successors and Assigns; No Third Party Beneficiaries.
(1)The parties agree that their relationship is that of independent contracting parties and thatRecipient is not an officer, employee, or agent of the State of Oregon as those terms are used in
ORS 30.265.
(2)Nothing in this Contract gives, or is to be construed to give, directly or indirectly, to any third
persons any rights and benefits greater than those enjoyed by the general public.
(3)This Contract will be binding upon and inure to the benefit of OBDD, Recipient, and their
respective successors and permitted assigns.
(4)Recipient may not assign or transfer any of its rights or obligations or any interest in thisContract or any other Financing Document without the prior written consent of OBDD. OBDDmay grant, withhold or impose conditions on such consent in its sole discretion. In the event of
an assignment, Recipient shall pay, or cause to be paid to OBDD, any fees or costs incurredbecause of such assignment, including but not limited to attorneys’ fees of OBDD’s Counsel.Any approved assignment is not to be construed as creating any obligation of OBDD beyondthose in this Contract or other Financing Documents, nor does assignment relieve Recipient of
any of its duties or obligations under this Contract or any other Financing Documents.
(5)Recipient hereby approves and consents to any assignment, sale or transfer of this Contract and
the Financing Documents that OBDD deems to be necessary.
C.Disclaimer of Warranties; Limitation of Liability. Recipient agrees that:
(1)OBDD makes no warranty or representation, either express or implied, as to the value, design,condition, merchantability or fitness for particular purpose or fitness for any use of the Projector any portion of the Project, or any other warranty or representation.
(2)The liability of OBDD under this Contract is contingent upon the availability of moneys in the
Special Public Works Fund for use in the project, and in no event are OBDD or its agentsliable or responsible for any direct, indirect, incidental, special, consequential or punitivedamages in connection with or arising out of this Contract or the existence, furnishing,functioning or use of the Project.
D.Notices and Communication. Except as otherwise expressly provided in this Contract, any
communication between the parties or notices required or permitted must be given in writing bypersonal delivery, email, or by mailing the same, postage prepaid, to Recipient or OBDD at theaddresses set forth below, or to such other persons or addresses that either party may subsequently
indicate pursuant to this Section.
Any communication or notice by personal delivery will be deemed effective when actually deliveredto the addressee. Any communication or notice so addressed and mailed will be deemed to bereceived and effective five (5) days after mailing. Any communication or notice given by emailbecomes effective 1) upon the sender’s receipt of confirmation generated by the recipient’s email
system that the notice has been received by the recipient’s email system or 2) the recipient’s
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confirmation of receipt, whichever is earlier. Notwithstanding this provision, the following notices may not be given by email: notice of default or notice of termination.
If to OBDD: Deputy Director Oregon Business Development Department 775 Summer Street NE Suite 200 Salem, OR 97301-1280
If to Recipient: Public Works Director
City of Sandy 39250 Pioneer Blvd Sandy, OR 97055
E.No Construction against Drafter. This Contract is to be construed as if the parties drafted it jointly.
F.Severability. If any term or condition of this Contract is declared by a court of competent jurisdictionas illegal, invalid or unenforceable, that holding will not invalidate or otherwise affect any other
provision.
G. Amendments, Waivers. This Contract may not be amended without the prior written consent of
OBDD (and when required, the Department of Justice) and Recipient. This Contract may not beamended in a manner that is not in compliance with the Act. No waiver or consent is effective unlessin writing and executed by the party against whom such waiver or consent is sought to be enforced.Such waiver or consent will be effective only in the specific instance and for the specific purpose
given.
H. Attorneys’ Fees and Other Expenses. To the extent permitted by the Oregon Constitution and theOregon Tort Claims Act, the prevailing party in any dispute arising from this Contract is entitled to
recover its reasonable attorneys’ fees and costs at trial and on appeal. Reasonable attorneys’ feescannot exceed the rate charged to OBDD by its attorneys. Recipient shall, on demand, pay to OBDDreasonable expenses incurred by OBDD in the collection of Loan payments.
I.Choice of Law; Designation of Forum; Federal Forum. The laws of the State of Oregon (without givingeffect to its conflicts of law principles) govern all matters arising out of or relating to this Contract,
including, without limitation, its validity, interpretation, construction, performance, and
enforcement.
Any party bringing a legal action or proceeding against any other party arising out of or relating tothis Contract shall bring the legal action or proceeding in the Circuit Court of the State of Oregon for
Marion County (unless Oregon law requires that it be brought and conducted in another county).
Each party hereby consents to the exclusive jurisdiction of such court, waives any objection to
venue, and waives any claim that such forum is an inconvenient forum.
Notwithstanding the prior paragraph, if a claim must be brought in a federal forum, then it must bebrought and adjudicated solely and exclusively within the United States District Court for the District ofOregon. This paragraph applies to a claim brought against the State of Oregon only to the extent
Congress has appropriately abrogated the State of Oregon’s sovereign immunity and is not consentby the State of Oregon to be sued in federal court. This paragraph is also not a waiver by the State ofOregon of any form of defense or immunity, including but not limited to sovereign immunity andimmunity based on the Eleventh Amendment to the Constitution of the United States.
J.Integration. This Contract (including all exhibits, schedules or attachments) and the other FinancingDocuments constitute the entire agreement between the parties on the subject matter. There are nounspecified understandings, agreements or representations, oral or written, regarding this Contract.
K. Execution in Counte,marts. This Contract may be signed in several counterparts, each of which is an
original and all of which constitute one and the same instrument.
Recipient, by its signature below, acknowledges that it has read this Contract, understands it, and agrees
to be bound by its terms and conditions.
s.NDY
ST ATE OF OREGON CITY OF SANDY
acting by and through its
Oregon Business Development Department
By: ____________ By:
Chris Cummings, Deputy Director
Date:
APPROVED AS TO LEGAL SUFFICIENCY IN ACCORDANCE WITH ORS 291.047:
Isl David Berryman per email dated 18 December 2024
David Berryman, Assistant Attorney General
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EXHIBIT A - GENERAL DEFINITIONS
As used in this Contract, the following terms have the meanings below.
“Act” means ORS 285B.410 through 285B.482, as amended.
“Award” means the award of financial assistance to Recipient by OBDD dated 22 November 2023.
“Costs of the Project” means Recipient’s actual costs (including any financing costs properly allocable to the Project) that are (a) reasonable, necessary and directly related to the Project, (b) permitted by generally accepted accounting principles to be Costs of the Project, and (c) are eligible or permitted uses of the Financing Proceeds under applicable state or federal statute and rule.
“Counsel” means an attorney at law or firm of attorneys at law duly admitted to practice law before the highest court of any state, who may be of counsel to, or an employee of, OBDD or Recipient.
“Financing Documents” means this Contract and all agreements, instruments, documents and
certificates executed pursuant to or in connection with OBDD’s financing of the Project.
“Financing Proceeds” means the proceeds of the Loan.
“Lottery Bonds” means any bonds issued by the State of Oregon that are special obligations of the State of Oregon, payable from unobligated net lottery proceeds, together with any refunding bonds, used
to finance or refinance the Project through the initial funding or refinancing of all or a portion of the
Loan.
“Municipality” means any entity described in ORS 285B.410(9).
“ORS” means the Oregon Revised Statutes.
“Project Completion Date” means the date on which Recipient completes the Project.
“Refunding Proceeds” means the proceeds of any subsequent short- or long-term financing, whether
resulting from the sale of tax-exempt bonds or otherwise, issued to refund the Loan or to finance the Project.
“System” means Recipient’s drinking water system, which includes the Project or components of the Project, as it may be modified or expanded from time to time.
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EXHIBIT B - SECURITY
A.Full Faith & Credit Pledge. Recipient pledges its full faith and credit and taxing power within thelimitations of Article XI, sections 11 and 11 b, of the Oregon Constitution to pay the amounts due
under this Contract. All amounts due under this Contract are payable from all legally available funds
of Recipient.
B.Refunding Proceeds. The outstanding principal of and accrued, but unpaid, interest on the Loan shallbe payable from any Refunding Proceeds. Recipient hereby grants to OBDD a security interest in
and irrevocably pledges the Refunding Proceeds to pay all of the obligations owed by Recipient to
OBDD under this Contract. The Refunding Proceeds pledged and hereafter received by Recipient
will be immediately subject to the lien of this pledge without physical delivery or further act, and thelien of this pledge will be superior to all other claims and liens to the fullest extent permitted by ORS287A.310. Recipient represents and warrants that this pledge of Refunding Proceeds complies with,and is valid and binding from the effective date of this Contract as described in, ORS 287A.310.
C.Pledge of Net Revenues of the System.
1.All payment obligations under this Contract and the other Financing Documents are payable fromthe revenues of Recipient’s System after payment of operation and maintenance costs of the System(“Net Revenues”). Recipient irrevocably pledges and grants to OBDD a security interest in the Net
Revenues to pay all of Recipient’s obligations under this Contract and the other Financing
Documents. The Net Revenues pledged pursuant to the preceding sentence and received by
Recipient will immediately be subject to the lien of this pledge without physical delivery, filing orfurther act, and the lien of this pledge is superior to all other claims and liens, except as provided insubsections 2 and 3 of this section C, to the fullest extent permitted by ORS 287A.310. Recipientrepresents and warrants that this pledge of Net Revenues complies with, and is valid and binding
from the date of this Contract as described in, ORS 287A.310.
2.Recipient shall not incur, without the prior written consent of OBDD, any obligation payable fromor secured by a lien on and pledge of the Net Revenues that is superior to, or on parity with theLoan.
3.Notwithstanding the requirements of subsection 2 of this section C, loans previously made and
loans made in the future by OBDD to Recipient that are secured by the Net Revenues may have a
lien on such Net Revenues on parity with the Loan; provided that nothing in this paragraph will adversely affect the priority of any of OBDD’s liens on such Net Revenues in relation to the lien(s) of any third party(ies).
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EXHIBIT C - PROJECT DESCRIPTION
Recipient will, with the assistance of a professional engineer licensed in Oregon, make water treatment improvements to the Alder Creek Water Treatment Plant. These improvements will include, but are not
limited to, procurement, design and installation of a containerized, pre-packaged, low-pressure membrane filtration treatment and neutralization system and installation of a canopy structure attached to an approximately 420 square foot concrete slab/foundation. The Costs of the Project include, but are not limited to, project management, construction bid services, construction management services, and
financial and reporting services, as well as pre-award funding for a conceptual design report for the
Alder Creek Water Treatment Plant.
EXHIBIT D - PROJECT BUDGET
Line Item Activity OBDD Funds Other / Matching Funds
Design/Engineering $1,150,000 $0
Construction $4,623,737 $0
Contingency $501,263 $0
Planning and Conceptual Design (Pre-Award) $150,000 $0
Membrane System Purchase $3,000,000 $0
Membrane System Procurement $75,000 $0
Total $9,500,000 $0