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designated by the City as qualified tax-exempt obligations pursuant to Section 265(b) (3) of the Code; (2) that the Bonds, being current refunding obligations, are not taken into account for purposes of the 2000 $10,000,000 limit, (3) the average maturity of the Bonds is less than the average maturity of the Refunded Bonds; and (4) that no Bond has a maturity date which is more than 30 years after the date that the original qualified tax-exempt obligations (being the Prior Bonds) were issued. 25. Defeasance. When any obligation of a Bond has been discharged as provided in this paragraph, all pledges, covenants and other rights granted by this Resolution to the registered owner of that Bond (with respect to the obligation thereof so defeased) shall, to the extent permitted by law, cease. The City may at any time discharge any or all of such obligation(s) with respect to any Bond, subject to the provisions of law now or hereafter authorizing or regulating such action, by depositing irrevocably in escrow, with a suitable institution qualified by law as an escrow agent for this purpose, cash or securities which are backed by the full faith and credit of the United States of America, bearing interest payable at such times and at such rates and maturing on such dates and in such amounts as shall be required and sufficient, subject to sale and/or reinvestment in like securities, to pay said obligation(s), which may include any interest payment on such Bond and/or principal amount due thereon at a stated maturity (or if irrevocable provision shall have been made for permitted prior redemption of such principal amount, at such earlier redemption date). 26. No Continuinq Disclosure Undertakinq. The Council hereby finds that the Bonds are exempt from continuing disclosure requirements of Rule 15c2-12 of the Securities and Exchange Commission, as recently amended and/or supplemented, because the Bonds are issued in the aggregate principal amount of less than $1,000,000. Consequently, the City is not covenanting to provide and will not provide annual financial information, notices of certain material events or any other disclosure or information which would otherwise be required by that Rule. 27. Severability. If any section, paragraph or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Resolution. 28. Headings. Headings in this Resolution are included for convenience of reference only and shall not limit or define the meaning of any provision hereof. Adopted on October 23, 2000, by the Elk River City Council. 1218477.1 24