1998-43378-Resolution No. 98-104 Recorded 8/13/1998Z: F—, _ .
168 - 2646
98-433"78
REVIEWED
l
LEA CUUNSEL
M�
co
Deschutes County, Oregon
-D N
Resolution No. 98-104
Authorizing General Obligation Refunding Bonds, Series 1998.
Adopted August 12, 1998
MICROF!tMED KEMWIED
SE
�
S E. P 3 0 1998 SES 1998
168 26
Section1. Findings.........................................................................................
Section 2. Plan Submission; Experts..............................................................
Section 3. Bonds Authorized..........................................................................
Section 4. Refunding Bond Book -Entry Form ...............................................
Section 5. Optional Redemption.....................................................................
Section 6. Notice of Redemption of Bonds ....................................................
Section 7. Authentication, Registration And Transfer ....................................
Section 8. Security For Refunding Bonds .......................................................
Section 9. Refunding Bond Insurance............................................................
Section 10. Form of Refunding Bonds...........................................................
Section11. Execution.....................................................................................
Section 12. Tax -Exempt Status.......................................................................
Section 13. Delegation for Section 265(b)(3) Designation ............................
Section14. Escrow..........................................................................................
Section 15. Redemption Of Refundable Bonds ..............................................
Section 16. Defeasance...................................................................................
Exhibit A Form of Bond
Exhibit B Form of Escrow Deposit Agreement
Page 1 -- Resolution
..............1
..............1
..............2
..............2
..............4
..............4
..............6
..............7
..............7
..............7
..............7
..............7
..............8
..............8
..............8
..............8
J:\RDR\DESCHUTE.CO\GOAdvRef98\Res-auth.doc
;S
BEFORE THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON
RESOLUTION AUTHORIZING
ISSUANCE AND SALE OF
GENERAL OBLIGATION REFUNDING
BONDS SERIES 1998
RESOLUTION NO. 98-104
The Board of Commissioners of the Deschutes County finds:
Section 1. Findings.
1.1. The County is authorized pursuant to the Constitution and laws of the State
of Oregon to issue refunding bonds to refund its outstanding general obligation bonds.
1.2. Issuing refunding bonds to refund all or a portion of the County's General
Obligation Bonds, Series 1992 (the "Refundable Bonds") will benefit the County and its
taxpayers by reducing debt service costs; and,
1.3. The approval of the State Treasurer is required before such refunding bonds
may be issued; and,
1.4. A refunding plan must be submitted to the State Treasurer demonstrating that
the refunding will produce debt service savings before the State Treasurer may approve the
refunding; and,
1.5. Seattle -Northwest Securities Corporation has prepared a refunding plan for
the Refundable Bonds; and
1.6. The County expects to issue its refunding bonds if the State Treasurer
approves of the refunding; now, therefore,
follows:
BE IT RESOLVED by the Board of Commissioners of Deschutes County as
Section 2. Plan Submission; Experts.
Seattle -Northwest Securities Corporation is hereby authorized, on behalf of the
County, to submit a refunding plan for the Refundable Bonds to the State Treasurer for review
and approval. Seattle -Northwest Securities Corporation is hereby appointed underwriter for the
proposed refunding bonds and Preston Gates & Ellis LLP is appointed bond counsel. U.S. Bank
Trust National Association is appointed as escrow agent, paying agent and registrar.
Page 1 -- Resolution J:\RDR\DESCHUTE.CO\GOAdvRef.98\Res-auth.doc
168 - 2649
Section 3. Bonds Authorized.
For the above purpose, the County shall issue its General Obligation Refunding
Bonds, Series 1998 (the "Refunding Bonds"). The Finance Director (the Finance Director"), on
behalf of the County, and without further action by the Board of Commissioners, is authorized
to:
3.1. Participate in the preparation and authorize the distribution of a preliminary
official statement or other disclosure document for the Refunding Bonds;
3.2. Appoint an expert advisor to prepare the report required by ORS 287.028;
3.3. Negotiate the terms of, and execute, a bond purchase agreement with the
underwriter;
3.4. Establish the principal amount, interest rates, redemption terms, payment
dates and other terms of the Refunding Bonds, the series and dates thereof, provided that the
Refunding Bonds produce debt service savings having a present value of not less than three
percent of the principal amount of the Refunding Bonds and are sold at a true interest cost of not
to exceed 7% and are approved by the State Treasurer;
3.5. Execute and deliver an escrow deposit agreement (the "Escrow Deposit
Agreement"), in substantially the form attached as Exhibit B, with such changes as the Finance
Director finds are in the best interests of the County, and authorize the purchase of securities to
be held under the Escrow Deposit Agreement; and
3.6. Issue, sell and deliver the Refunding Bonds, and execute and deliver any
related certificates or documents which are reasonably required to refund the Refundable Bonds
in accordance with this resolution.
Section 4. Refunding Bond Book -Entry Form.
4.1. The Refunding Bonds shall be initially issued in book -entry form, with no
Refunding Bonds being made available to the Bondowners. The Finance Director shall execute
and deliver letters of representations to The Depository Trust Company, New York, New York
("DTC") for the Refunding Bonds, in form and substance satisfactory to DTC. So long as the
Refunding Bonds are in book -entry form:
4.1.1. Ownership of the Refunding Bonds shall be recorded through
entries on the books of banks and broker-dealer participants and correspondents that are
related to entries on the DTC system. The Refunding Bonds shall be initially issued in
the form of a global bond. Each global bond shall be registered in the name of
Cede & Co. as nominee of DTC as the owner of the Refunding Bond, and such global
bonds shall be lodged with DTC until early redemption or maturity of the Refunding
Bond issue.
Page 2 -- Resolution]:\RDR\DESC14UTE.CO\GOAdvRef.98\Res-auth.doc
168 2650
4.1.2. The Registrar shall remit payment for the maturing principal and
interest on the Refunding Bonds to DTC as owner of the Refunding Bonds for
distribution by the nominee to the beneficial owners by recorded entry on the books of
DTC participants and correspondents. While the Refunding Bonds are in book -entry
form, the Refunding Bonds will be available in denominations of $5,000 or any integral
multiple thereof.
4.2. In the event DTC determines not to continue to act as securities depository
for the Refunding Bonds, or the County determines that DTC shall no longer so act; then the
County will discontinue maintaining the Refunding Bonds in the book -entry form with DTC.
4.3. Notwithstanding the provisions regarding exchange and transfer of
Refunding Bonds set forth in this resolution, while the Refunding Bonds are in book -entry form
they may not be transferred or exchanged on the registration books maintained by the Paying
Agent except:
below;
4.3.1. to any successor depository designated by the County as provided
4.3.2. to any successor nominee designated by a depository; or
4.3.3. if the County elects to discontinue maintaining the Refunding
Bonds in book -entry form, the County shall cause the Paying Agent to authenticate and
deliver replacement Refunding Bonds in fully registered form in authorized
denominations in the names of the beneficial owners or their nominees; thereafter the
provisions set forth herein, regarding registration, transfer and exchange of Refunding
Bonds shall apply.
4.4. Upon the resignation of any institution acting as depository hereunder, or if
the County determines that continuation of any institution in the role of depository is not in the
best interests of the beneficial owners, the County shall attempt to identify another institution
qualified to act as depository hereunder or shall discontinue maintaining the Refunding Bonds in
book -entry form by resolution or ordinance. If the County is unable to identify such successor
depository prior to the effective date of the resignation, the County shall discontinue maintaining
the Refunding Bonds in book -entry form as provided above.
4.5. With respect to Refunding Bonds registered in the registration books
maintained by the Paying Agent in the name of the nominee of DTC, the County and the Paying
Agent shall have no responsibility or obligation to any participant or correspondent of DTC or to
any beneficial owner on behalf of which such participants or correspondents act as agent for the
beneficial owner with respect to:
4.5.1. the accuracy of the records of DTC, the Nominee or any participant
or correspondent with respect to any beneficial owner's interest in the Refunding Bonds;
Page 3 -- Resolution J:\RDR\DESCIfUTE.CO\GOAdvRef.98\Res-auth.doc
168 - 2651
4.5.2. the delivery to any participant or correspondent or any other person
of any notice with respect to the Refunding Bonds, including any notice of prepayment;
4.5.3. the selection by DTC of the beneficial interest in Refunding Bonds
to be redeemed prior to maturity; or
4.5.4. the payment to any participant, correspondent, or any other person
other than the registered owner of the Refunding Bonds as shown in the registration
books maintained by the Paying Agent, of any amount with respect to principal or interest
on the Refunding Bonds.
4.6. So long as the Refunding Bonds are in book -entry form, the Paying Agent
will give any notice of redemption or any other notices required to be given to registered owners
of Refunding Bonds only to DTC or its nominee registered as the registered owner thereof. Any
failure of DTC to advise any of its participants, or of any participant to notify the beneficial
owner, of any such notice and its content or effect will not affect the validity of the redemption
of the Refunding Bonds called for redemption or of any other action premised on such notice.
Neither the County nor the Paying Agent is responsible or liable for the failure of DTC or any
participant to make any payment or give any notice to a beneficial owner in respect of the
Refunding Bonds or any error or delay relating thereto.
4.7. The County shall pay or cause to be paid all principal and interest on the
Refunding Bonds only to or upon the order of the owner, as shown in the registration books
maintained by the Paying Agent, or their respective attorneys duly authorized in writing, and all
such payments shall be valid and effective to fully satisfy and discharge the County's obligation
with respect to payment thereof to the extent of the sum or sums so paid.
4.8. Upon delivery by DTC to the County and to the owner of written notice to
the effect that DTC has determined to substitute a new nominee in place of the nominee, then the
word "nominee" in this resolution shall refer to such new nominee of DTC, and upon receipt of
such notice, the County shall promptly deliver a copy thereof to the Paying Agent. DTC shall
tender the Refunding Bonds it holds to the Paying Agent for reregistration.
4.9. The provisions of this Section may be modified without the consent of the
beneficial owners in order to conform this Section to the standard practices of DTC for bonds
issued in book -entry form.
Section 5. Optional Redemption.
5.1. The County reserves the right to redeem all or any portion of the Bonds as
authorized in the Bond Purchase Agreement.
Section 6. Notice of Redemption of Bonds.
6.1. Notice of Redemption (DTC). So long as the Refunding Bonds are in
book -entry form, the Paying Agent shall notify DTC of any early redemption not less than
Page 4 -- Resolution 1:\RDR\DESCHUTE.CO\GOAdvRef9g\Res-auth.doc
168 - 2652
30 days prior to the date fixed for redemption, and shall provide such information in connection
therewith as required by a letter of representations submitted to DTC in connection with the
issuance of the Refunding Bonds.
6.2. Notice of Redemption (No DTC). During any period in which the
Refunding Bonds are not in book -entry form, unless waived by any Owner of the Refunding
Bonds to be redeemed, official notice of any redemption of Refunding Bonds shall be given by
the Paying Agent on behalf of the County by mailing a copy of an official redemption notice by
first class mail postage prepaid at least 30 days and not more than 60 days prior to the date fixed
for redemption to the Owner of the Refunding Bond or Bonds to be redeemed at the address
shown on the bond register or at such other address as is furnished in writing by such owner to
the Paying Agent. The County shall notify the Paying Agent of any intended redemption not less
than 45 days prior to the redemption date. All such official notices of redemption shall be dated
and shall state:
6.2.1. the redemption date,
6.2.2. the redemption price,
6.2.3. if less than all outstanding Refunding Bonds are to be redeemed,
the identification (and, in the case of partial redemption, the respective principal amounts)
of the Refunding Bonds to be redeemed,
6.2.4. that on the redemption date the redemption price will become due
and payable upon each such Refunding Bond or portion thereof called for redemption,
and that interest thereon shall cease to accrue from and after said date, and
6.2.5. the place where such Refunding Bonds are to be surrendered for
payment of the redemption price, which place of payment shall be the principal office of
the Paying Agent.
6.2.6. Prior to any redemption date, the County shall deposit with the
Registrar an amount of money sufficient to pay the redemption price of all the Bonds or
portions of Bonds which are to be redeemed on that date.
6.2.7. Official notice of redemption having been given as aforesaid, the
Bonds or portions of Bonds so to be redeemed shall, on the redemption date, become due
and payable at the redemption price therein specified, and from and after such date
(unless the County shall default in the payment of the redemption price) such Bonds or
portions of Bonds shall cease to bear interest. Upon surrender of such Bonds for
redemption in accordance with said notice, such Bonds shall be paid by the Registrar at
the redemption price. Installments of interest due on or prior to the redemption date shall
be payable as herein provided for payment of interest. Upon surrender for any partial
redemption of any Bond, there shall be prepared for the registered owner a new Bond or
Bonds of the same maturity in the amount of the unpaid principal. All Bonds which have
been redeemed shall be canceled and destroyed by the Registrar and shall not be reissued.
Page 5 -- Resolution]:\RDR\DESCHUTE.CO\GOAdvRef.98\Re-auth.doc
168 u 2653
Section 7. Authentication, Registration And Transfer.
7.1. 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 Paying Agent.
The Paying Agent shall authenticate all Refunding Bonds to be delivered at closing of the
Refunding Bonds, and shall additionally authenticate all Refunding Bonds properly surrendered
for exchange or transfer pursuant to this resolution.
7.2. The ownership of all Refunding Bonds shall be entered in the bond register
maintained by the Paying Agent, and the County and the Paying Agent may treat the person
listed as owner in the bond register as the owner of the Refunding Bond for all purposes.
7.3. While the Refunding Bonds are in book -entry form, the Paying Agent shall
transfer Refunding Bond principal and interest payments in the manner required by DTC.
7.4. If the Refunding Bonds cease to be in book -entry form, the Paying Agent
shall mail each interest payment on the interest payment date (or the next business day if the
payment date is not a business day) to the name and address of the Refunding Bondowners as
they appear 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 County nor the Paying
Agent shall have any further liability to any party for such payment.
7.5. 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 owners if the Refunding Bondowner submits the following to
the Paying Agent:
7.5.1. written instructions for exchange or transfer satisfactory to the
Paying Agent, signed by the Refunding Bondowner or attorney in fact and guaranteed or
witnessed in a manner satisfactory to the Paying Agent; and
7.5.2. the Refunding Bonds to be exchanged or transferred.
7.6. The Paying Agent 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.
7.7. The Paying Agent shall note the date of authentication on each Refunding
Bond. The date of authentication shall be the date on which the Refunding Bondowner's name is
listed on the bond register.
7.8. For purposes of this section, Refunding Bonds shall be considered submitted
to the Paying Agent on the date the Paying Agent actually receives the materials described in
Section 5.
Page 6 -- Resolution J:\RDR\DESCHUTE.CO\GOAdvRef9g\Re -auth.doc
168 2654
7.9. The County may alter these provisions regarding registration and transfer by
mailing notification of the altered provisions to all Refunding 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. Security For Refunding Bonds.
Pursuant to ORS 288.160 the County may issue general obligation refunding
bonds to refund general obligation bonds which were issued for capital construction or
improvements, upon compliance with the provisions of that statute. The Refundable Bonds were
issued for capital construction and improvements, and the Refunding Bonds shall be issued in
compliance with ORS 288.160. Accordingly, the Refunding Bonds shall replace the Refundable
Bonds which are refunded by the Refunding Bonds, and the full faith and credit of the County
are pledged to the successive owners of each of the Refunding Bonds for the punctual payment
of such obligations, when due. The County shall levy annually, as provided by law, a direct
ad valorem tax upon all of the taxable property within the County in sufficient amount, after
taking into consideration discounts taken and delinquencies that may occur in the payment of
such taxes and other moneys available for the payment of debt service on the Refunding Bonds,
to pay the Refunding Bonds promptly as they mature. The County covenants with the owners of
the Refunding Bonds to levy such a tax annually during each year that any of the Refunding
Bonds, or bonds issued to refund them, are outstanding.
Section 9. Refunding Bond Insurance.
The Finance Director may apply for municipal bond insurance for the Refunding
Bonds, and may expend Refunding Bond proceeds to pay any bond insurance premium.
Section 10. Form of Refunding Bonds.
The Refunding Bonds shall be in substantially the form attached hereto as
Exhibit A, with such changes as may be approved by the Finance Director. The Refunding
Bonds may be printed or typewritten, and may be issued as one or more temporary Refunding
Bonds which shall be exchangeable for definitive Refunding Bonds when definitive Refunding
Bonds are available.
Section 11. Execution.
The Refunding Bonds shall be executed on behalf of the County with the
facsimile signatures of the Chair and the Clerk.
Section 12. Tax -Exempt Status.
12.1. The County covenants to use the proceeds of the Refunding Bonds, and the
facilities financed with the Refundable Bonds, and to otherwise comply with the provisions of
the Internal Revenue Code of 1986, as amended, (the ".Code") so that interest paid on the
Page 7 -- Resolution 1:\RDR\DESCHUTE.CO\GOAdvRef.98\Res-auth.doc
168 u 2655
Refunding Bonds will not be includable in gross income of the bondowners. The County
specifically covenants:
12.1.1. to comply with the "arbitrage" provisions of Section 148 of the
Code, and pay any rebates due to the United States on the gross proceeds of the
Refunding Bonds;
12.1.2. to yield restrict and pay any rebates due to the United States on
any unexpended proceeds of the Refundable Bonds; and
12.1.3. to operate the facilities which were financed with the proceeds of
the Refundable Bonds, and any facilities which are financed with the unexpended
proceeds of the Refundable Bonds, so that the Refunding Bonds are not "private activity
bonds" under Section 141 of the Code.
12.2. The Finance Director may enter into covenants on behalf of the County to
protect the tax-exempt status of the Refunding Bonds.
Section 13. Delegation for Section 265(b)(3) Designation .
In the event that the Bonds are qualified tax-exempt obligations under
Section 265(b)(3) of the Code, the Finance Director is authorized to make the desigation required
by Section 265(b)(3)(B)(i)(III) of the Code.
Section 14. Escrow.
The net proceeds of the Refunding Bonds shall be placed in irrevocable escrow,
pursuant to the Escrow Deposit Agreement. U.S. Bank Trust National Association, as Escrow
Agent or the Finance Director are hereby authorized to subscribe for and purchase the
government obligations to be placed in the escrow, on behalf of the County.
Section 15. Redemption Of Refundable Bonds.
Contingent solely on the issuance of the Refunding Bonds and the deposit of the
net proceeds with the escrow agent, the County hereby irrevocably calls for redemption all of the
Refundable Bonds on December 1, 2002, which is the earliest date on which they are subject to
redemption.
Section 16. Defeasance.
If the County:
16.1. irrevocably deposits money or noncallable Government Obligations in
escrow with an independent trustee or escrow agent which are calculated to be sufficient for the
payment of Refunding Bonds which are to be defeased; and,
Page 8 -- Resolution 1:\RDR\DESCHUTE.CO\GOAdvRef98\Res-auth.doc
168 2656
16.2. files with the escrow agency or trustee an opinion from an independent,
certified public accountant to the effect that the money and the principal and interest to be
received from the Government Obligations are calculated to be sufficient, without further
reinvestment, to pay the defeased Refunding Bonds when due; and,
16.3. files with the escrow agent or trustee an opinion of nationally recognized
bond counsel that the proposed defeasance will not cause the interest component of the
Refunding Bonds to be includable in gross income under the Code;
then the County shall be obligated to pay the defeased Refunding Bonds solely from the money
and Government Obligations deposited with the escrow agent or trustee, and the County shall
have no further obligation to pay the defeased Refunding Bonds from any source except the
amounts deposited in the escrow. For purposes of this section, "Government Obligations" means
direct obligations of the United States, or obligations the principal of and interest on which are
fully and unconditionally guaranteed by the United States.
Dated this 12`' day of August, 1998.
Attest
Recording Secretary
Page 9 -- Resolution J:\RDR\DESCHUTE.CO\GOAdvRef.98\Res-auth.doc
168 2657
EXHIBIT A
(Form of Bond)
No. R- $
United States of America
State of Oregon
Deschutes County
Oregon
General Obligation Refunding Bonds
Series 1998
Dated Date: , 1998
Interest Rate: %
Maturity Date: 1,
CUSIP Number: -
Registered Owner: -----Cede & Co. -----
Principal Amount: ----- Dollars -----
Deschutes County, , Oregon (the County"), for value received, acknowledges
itself indebted and hereby promises to pay to the registered owner hereof, or registered assigns,
the principal amount as indicated above on the above maturity date together with interest thereon
from the date hereof at the rate per annum indicated above, computed on the basis of a 360 -day
year of twelve 30 -day months. Interest is payable semiannually on the first day of and the
first day of in each year until maturity or prior redemption, commencing 1, 199_.
Principal and interest payments shall be received by Cede & Co., as nominee of The Depository
Trust Company, or its registered assigns, on each payment date. Such payments shall be made
payable to the order of "Cede & Co."
This bond is one of a duly authorized series of bonds aggregating $ in
principal amount designated as General Obligation Refunding Bonds, Series 1998 (the "Bonds").
The Bonds are issued for the purpose of refunding portions of the County's outstanding General
Obligation Bonds, Series 1992. The Bonds are issued under and pursuant to Resolution No. 98-
104 (the Resolution") of the County adopted on August 12, 1998 and in full and strict accordance
and compliance with all of the provisions of the Constitution and Statutes of the State of Oregon.
The Bonds are initially issued as a book -entry -only security issue with no
certificates provided to the Bondowners. Records of Bond ownership will be maintained by the
Registrar and The Depository Trust Company and its participants.
Should the book -entry only security system be discontinued, the Bonds shall be
issued in the form of registered Bonds without coupons in the denominations of $5,000 or any
integral multiple thereof. Such Bonds may be exchanged for Bonds of the same aggregate
principal amount, but different authorized denominations, as provided in the Bond Resolution.
""°"� ""
Page 1 - Exhibit A (Form of Bond) ° `
n�n s, is9e
168 2658
Any transfer of this Bond must be registered, as provided in the Resolution, upon
the bond register kept for that purpose at the principal corporate trust office of the Registrar.
This Bond may be registered only by surrendering it, together with a written instrument of
transfer which is satisfactory to the Registrar and which is executed by the registered owner or
duly authorized attorney. Upon registration, a new registered Bond or Bonds, of the same series
and maturity and in the same aggregate principal amount, shall be issued to the transferee as
provided in the Resolution. The County and the Registrar may treat the person in whose name
this Bond is registered on the bond register as its absolute owner for all purposes, as provided in
the Resolution.
[insert term bond provisions, if applicable]
Notice of any call for redemption shall be given as required by the Letter of
Representations to The Depository Trust Company, as referenced in the Bond Resolution.
Interest on any Bond or Bonds so called for redemption shall cease on the redemption date
designated in the notice. The Issuer's paying agent and registrar, which is currently U.S. Bank
Trust National Association, in Portland, Oregon (the "Registrar"), will notify The Depository
Trust Company promptly of any Bonds called for redemption.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company to the issuer or its agent for registration of transfer, exchange
or payment, and any certificate issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of The Depository Trust
Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all conditions,
acts, and things required to exist, to 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 that the issue of
which this bond is a part, and all other obligations of such County, are within every debt
limitation and other limit prescribed by such Constitution and Statutes; and that the County has
covenanted to levy a tax upon all taxable property within the County in an amount sufficient,
with other available funds, to pay when due the interest on and the principal of the bonds.
M:\COM6
Page 2 - Exhibit A (Form of Bond) asLnoC
Augiul 5, 1998
168 2659
IN WITNESS WHEREOF, the Board of Commissioners has caused this bond to
be signed by facsimile signature of its Chair and attested by facsimile signature of its Clerk as of
the date indicated above.
Deschutes County,, Oregon
Chair
Finance Director
This Bond shall not be valid unless properly authenticated by the Registrar in the space indicated
below.
Dated:
Certificate of Authentication
This is one of County's $ General Obligation Refunding Bonds, Series
1998, issued pursuant to the Resolution described herein.
U.S. Bank Trust National Association, as Registrar
Authorized Officer
Page 3 - Exhibit A (Form of Bond)
-NIB_RSI.DOC
AUQua11, 1998
168 °s 2660
Assignment
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto:
(Please insert social security or other identifying number of assignee)
this 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:
NOTICE: The signature to this assignment must correspond with the name of the registered
owner as it appears upon the face of this bond in every particular, without alteration or
enlargement or any change whatever.
Signature Guaranteed
(Bank, Trust Company or Brokerage Firm)
Authorized Officer
The following abbreviations, when used in the inscription on the face of this 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 MIN
as custodian for (name of minor)
OR UNIF TRANS MIN ACT
under the Oregon Uniform Transfer to Minors Act
Additional abbreviations may also be used though not in the list above.
MiCOMe RSLDOC
Page 4 - Exhibit A (Form of Bond)
Augusl5, 1996
168 2661
EXHIBIT B
Form of Escrow Deposit Agreement
Page 1 - Exhibit B (Form of Escrow Deposit Agreement) M:\HWR\SfAYI N92 STAYARRS DOC
AY 5, 1
168 - 2662
Exhibit B
ESCROW DEPOSIT AGREEMENT
between
Deschutes County,
as Issuer
and
U.S. Bank Trust National Association,
as Escrow Agent
Dated as of , 1998
168 - 2663
Table of Contents
Article 1. Definitions and Interpretations....................................................................................3
Section1.1
Definitions....................................................................................................3
Section 1.2
Other Definitions.........................................................................................3
Section 1.3
Interpretations..............................................................................................3
Article 2. Deposit of Funds and Escrowed Securities..................................................................4
Section 2.1
Deposits in the Escrow Fund.......................................................................4
Article 3. Article 1.
Creation and Operation of Escrow Fund....................................................4
Section3.1
Escrow Fund................................................................................................4
Section 3.2
Payment of Principal and Interest................................................................4
Section 3.3
Sufficiency of Escrow Fund.........................................................................4
Section3.4
Trust Fund....................................................................................................5
Section 3.5
Security for Cash Balances..........................................................................5
Article 4. Limitation
on Investments...........................................................................................5
Section 4.1
Investments..................................................................................................5
Section 4.2
Substitution of Securities.............................................................................6
Article 5. Applicatio
n of Cash Balances.....................................................................................6
Section5.1
In General.....................................................................................................6
Article 6. Redemption of Refunded Bonds..................................................................................6
Section 6.1
Call for Redemption.....................................................................................6
Section 6.2
Notice of Redemption..................................................................................6
Article 7. Records and Reports....................................................................................................7
Section7.1
Records........................................................................................................7
Section7.2
Reports.........................................................................................................7
Article 8. Concerning
the Paying Agents and Escrow Agent......................................................7
Section 8.1
Representations............................................................................................7
Section 8.2
Limitation on Liability.................................................................................7
Section 8.3
Compensation..............................................................................................8
Section 8.4
Successor Escrow Agents............................................................................9
Section 8.5
Successor Escrow Agent by Merger, Consolidation, Transfer or Sale ........ 9
Article 9. Miscellaneous..............................................................................................................10
Section9.1
Notice...........................................................................................................10
Section 9.2
Termination of Responsibilities...................................................................10
Section 9.3
Binding Agreement......................................................................................10
Section9.4
Severability..................................................................................................10
168 r 2664
Section 9.5 Oregon Law Governs...................................................................................10
Section 9.6 Time of the Essence.....................................................................................11
Section 9.7 Notice to Moody's........................................................................................11
Section 9.8 Amendments................................................................................................11
Exhibit A -
Addresses of the Issuer and the Escrow Agent
Exhibit B -
Description of the Refunded Bonds
Exhibit C -
Schedule of Debt Service on Refunded Bonds
Exhibit D -
Description of Beginning Cash Deposit (if any) and Escrowed Securities
Exhibit E -
Escrow Fund Cash Flow
Appendix A -
Notice of Redemption
168 - 2665
ESCROW DEPOSIT AGREEMENT
Deschutes County, Oregon
General Obligation Refunding Bonds
Series 1998
THIS ESCROW AGREEMENT, dated as of , 1998 (herein, together with
any amendments or supplements hereto, called the "Agreement") is entered into by and between
the Deschutes County (herein called the "Issuer") and U.S. Bank Trust National Association, as
escrow agent (herein, together with any successor in such capacity, called the "Escrow Agent").
The notice addresses of the Issuer and the Escrow Agent are shown on Exhibit A attached hereto
and made a part hereof.
WITNESSETH:
WHEREAS, the Issuer heretofore has issued and there presently remain
outstanding the obligations described in Exhibit B attached hereto (the "Refunded Bonds"); and
WHEREAS, pursuant to a Resolution 98-104 of the Issuer adopted on August 12,
1998 the "Authorizing Action"), the Issuer has determined to issue its General Obligation
Refunding Bonds, Series 1998 (the "Refunding Bonds") for the purpose of providing funds to
pay the costs of refunding the Refunded Bonds; and
WHEREAS, the Escrow Agent has reviewed this Agreement, and is willing to
serve as Escrow Agent hereunder.
WHEREAS, Ernst & Young LLP, Memphis Tennessee, Certified Public
Accountants, have prepared a verification report which is dated , 1998 (the
"Verification Report") relating to the source and use of funds available to accomplish the
refunding of the Refunded Bonds, the investment of such funds and the adequacy of such funds
and investments to provide for the payment of the debt service due on the Refunded Bonds.
WHEREAS, pursuant to the Authorizing Action, all or a portion of the Refunded
Bonds have been designated for redemption prior to their scheduled maturity dates and, after
provision is made for such redemption, the Refunded Bonds will come due in such years, bear
interest at such rates, and be payable at such times and in such amounts as are set forth in
Exhibit C attached hereto and made a part hereof; and
WHEREAS, when Escrowed Securities have been deposited with the Escrow
Agent for the payment of all principal and interest of the Refunded Bonds when due and the
principal due upon redemption on December 1, 2002, then the Refunded Bonds shall no longer
be regarded as outstanding except for the purpose of receiving payment from the funds provided
for such purpose; and
Page 1 - Escrow Deposit Agreement J:\RDR\DESCHUTE.co\GOAavRef98\eaa.aoe
168 - 2666
WHEREAS, the Issuer's Authorizing Action authorizes the Issuer to issue
Refunding Bonds and to deposit the proceeds from the sale thereof, and any other available funds
or resources, with the Escrow Agent for the discharge and final payment of the Refunded Bonds;
and
WHEREAS, the Authorizing Action further authorizes the Issuer to enter into an
escrow agreement with the Escrow Agent with respect to the safekeeping, investment,
administration and disposition of any such deposit, upon such terms and conditions as the Issuer
and the Escrow Agent may agree, provided that such deposits may be invested only in direct
obligations of the United States of America, including obligations the principal of and interest on
which are unconditionally guaranteed by the United States of America, and which may be in
book entry form, and which shall mature and/or bear interest payable at such times and in such
amounts as will be sufficient to provide for the scheduled payment of the principal of, interest
and redemption premium (if any) on the Refunded Bonds when due and of the redemption price
on the Refunded Bonds when called for redemption; and
WHEREAS, the issuance, sale, and delivery of the Refunding Bonds have been
duly authorized to be issued, sold, and delivered for the purpose of obtaining the funds required
to provide for the payment of the principal of, interest on the Refunded Bonds as shown on
Exhibit C attached hereto; and
WHEREAS, the Issuer desires that, concurrently with the delivery of the
Refunding Bonds to the purchasers thereof, certain proceeds of the Refunding Bonds, together
with certain other available funds of the Issuer, shall be applied to purchase certain direct
obligations of the United States of America hereinafter defined as the "Escrowed Securities" for
deposit to the credit of the Escrow Fund created pursuant to the terms of this Agreement and to
establish a beginning cash balance (if needed) in such Escrow Fund; and
WHEREAS, the Escrowed Securities shall mature and the interest thereon shall be
payable at such times and in such amounts so as to provide moneys which, together with cash
balances from time to time on deposit in the Escrow Fund, will be sufficient to pay interest on
the Refunded Bonds as it accrues and becomes payable and the principal of the Refunded Bonds
as it becomes due and payable on the redemption date; and
WHEREAS, to facilitate the receipt and transfer of proceeds of the Escrowed
Securities, particularly those in book entry form, the Issuer desires to establish the Escrow Fund
at the corporate trust office of the Escrow Agent; and
WHEREAS, the Escrow Agent is a party to this Agreement to acknowledge its
acceptance of the terms and provisions hereof,
NOW, THEREFORE, in consideration of the mutual undertakings, promises and
agreements herein contained, the sufficiency of which hereby are acknowledged, and to secure
the full and timely payment of principal of and the interest and redemption premium (if any) on
Page 2 - Escrow Deposit Agreement J:\RDR\DESCHUTE.CO\GOAdvRef98\eda.doc
168 - 2667
the Refunded Bonds, the Issuer and the Escrow Agent mutually undertake, promise and agree for
themselves and their respective representatives and successors, as follows:
Article 1. Definitions and Interpretations.
Section 1.1 Definitions.
Unless the context clearly indicates otherwise, the following terms shall have the
meanings assigned to them below when they are used in this Agreement:
"Escrow Fund" means the fund created by this Agreement to be established, held
and administered by the Escrow Agent pursuant to the provisions of this Agreement.
"Escrowed Securities" means the noncallable Government Obligations described
in Exhibit D attached to this Agreement, or cash or other Government Obligations substituted
therefor pursuant to Section 4.2 of this Agreement.
"Government Obligations" means (a) direct, noncallable United States Treasury
Obligations, (b) United States Treasury Obligations - State and Local Government Series,
(c) direct, noncallable REFCORP debt obligations including STRIPS from noncallable
REFCORP debt obligations or STRIPS (stripped by the Federal Reserve Bank of New York).
"Paying Agent" means U.S. Bank Trust National Associaton, as the paying agent
for the Refunded Bonds.
"SLGS" means United States Treasury Obligations — State and Local Government
Series purchased from the Department of Treasury Bureau of Public Debt.
Section 1.2 Other Definitions.
The terms "Agreement," "Issuer," "Escrow Agent," "Authorizing Action,"
"Verification Report," "Refunded Bonds," and "Refunding Bonds" when they are used in this
Agreement, shall have the meanings assigned to them in the preamble to this Agreement.
Section 1.3 Interpretations.
The titles and headings of the articles and sections of this Agreement have been
inserted for convenience and reference only and are not to be considered a part hereof and shall
not in any way modify or restrict the terms hereof. This Agreement and all of the terms and
provisions hereof shall be liberally construed to effectuate the purposes set forth herein and to
achieve the intended purpose of providing for the refunding of the Refunded Bonds in
accordance with applicable law.
Page 3 - Escrow Deposit Agreement J:\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doe
168 v 2668
Article 2. Deposit of Funds and Escrowed Securities.
Section 2.1 Deposits in the Escrow Fund.
Concurrently with the sale and delivery of the Refunding Bonds the Issuer shall
deposit, or cause to be deposited, with the Escrow Agent, for deposit in the Escrow Fund, the
funds and Escrowed Securities described in Exhibit D attached hereto, and the Escrow Agent
shall, upon the receipt thereof, acknowledge such receipt to the Issuer in writing.
Article 3. Article 1. Creation and Operation of Escrow Fund.
Section 3.1 Escrow Fund.
The Escrow Agent has created on its books a special trust fund and irrevocable
escrow to be known as the Deschutes County General Obligation Refunding Bonds, Series 1998
Escrow Fund (the "Escrow Fund"). The Escrow Agent hereby agrees that upon receipt thereof it
will deposit to the credit of the Escrow Fund the funds and the Escrowed Securities described in
Exhibit "D" attached hereto. Such deposit, all proceeds therefrom, and all cash balances from
time to time on deposit therein (a) shall be the property of the Escrow Fund, (b) shall be applied
only in strict conformity with the terms and conditions of this Agreement, and (c) are hereby
irrevocably pledged to the payment of the principal of and interest on the Refunded Bonds,
which payment shall be made by timely transfers of such amounts at such times as are provided
for in Section 3.2 hereof. When the final transfers have been made for the payment of such
principal of and interest on the Refunded Bonds, any balance then remaining in the Escrow Fund
shall be transferred to the Issuer, and the Escrow Agent shall thereupon be discharged from any
further duties hereunder.
Section 3.2 Payment of Principal and Interest.
The Escrow Agent is hereby irrevocably instructed to transfer to the Paying Agent
from the cash balances from time to time on deposit in the Escrow Fund, the amounts required to
pay the principal of the Refunded Bonds at the respective redemption date and interest thereon to
such redemption date together with any redemption premium in the amounts and at the times
shown in Exhibit C attached hereto.
Section 3.3 Sufficiency of Escrow Fund.
The Issuer represents that, based upon the information provided in the
Verification Report, the successive receipts of the principal of and interest on the Escrowed
Securities will assure that the cash balance on deposit from time to time in the Escrow Fund will
be at all times sufficient to provide moneys for transfer to the Paying Agent at the times and in
the amounts required to pay the interest on the Refunded Bonds as such interest comes due and
the principal of the Refunded Bonds as the Refunded Bonds mature or are paid on an optional
redemption date prior to maturity and any redemption premium payable upon the optional
Page 4 - Escrow Deposit Agreement'_\RDR\DESC`-UTE.Co\G°"d"Re£98\eda.d°`
168 2669
redemption of the Refunded Bonds, all as more fully set forth in Exhibit E attached hereto. If,
for any reason, at any time, the cash balances on deposit or scheduled to be on deposit in the
Escrow Fund shall be insufficient to transfer the amounts required by the Paying Agent to make
the payments set forth in Section 3.2 hereof, the Issuer shall timely deposit in the Escrow Fund,
from any funds that are lawfully available therefor, additional funds in the amounts required to
make such payments. Notice of any such insufficiency shall be given promptly as hereinafter
provided, but the Escrow Agent shall not in any manner be responsible for any insufficiency of
funds in the Escrow Fund or the Issuer's failure to make additional deposits thereto.
Section 3.4 Trust Fund.
The Escrow Agent shall hold at all times the Escrow Fund, the Escrowed
Securities and all other assets of the Escrow Fund, wholly segregated from all other funds and
securities on deposit with the Escrow Agent; it shall never allow the Escrowed Securities or any
other assets of the Escrow Fund to be commingled with any other funds or securities of the
Escrow Agent; and it shall hold and dispose of the assets of the Escrow Fund only as set forth
herein. The Escrowed Securities and other assets of the Escrow Fund shall always be maintained
by the Escrow Agent as trust funds for the benefit of the owners of the Refunded Bonds; and a
special account thereof shall at all times be maintained on the books of the Escrow Agent. The
owners of the Refunded Bonds shall be entitled to the same preferred claim and first lien upon
the Escrowed Securities, the proceeds thereof, and all other assets of the Escrow Fund to which
they are entitled as owners of the Refunded Bonds. The amounts received by the Escrow Agent
under this Agreement shall not be considered as a banking deposit by the Issuer, and the Escrow
Agent shall have no right or title with respect thereto except as a trustee and Escrow Agent under
the terms of this Agreement. The amounts received by the Escrow Agent under this Agreement
shall not be subject to warrants, drafts or checks drawn by the Issuer or, except to the extent
expressly herein provided, by the Paying Agent.
Section 3.5 Security for Cash Balances.
Cash balances from time to time on deposit in the Escrow Fund shall, to the extent
not insured by the Federal Deposit Insurance Corporation or its successor, be continuously
secured by a pledge of direct obligations of, or obligations unconditionally guaranteed by, the
United States of America, having a market value at least equal to such cash balances.
Article 4. Limitation on Investments.
Section 4.1 Investments.
Except for the initial investment in the Escrowed Securities, and except as
provided in Section 4.2 hereof, the Escrow Agent shall not have any power or duty to invest or
reinvest any money held hereunder, or to make substitutions of the Escrowed Securities, or to
sell, transfer, or otherwise dispose of the Escrowed Securities.
Page 5 - Escrow Deposit Agreement 1:\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doc
168 - 2670
Section 4.2 Substitution of Securities.
At the written request of the Issuer, and upon compliance with the conditions
hereinafter stated, the Escrow Agent shall utilize cash balances in the Escrow Fund, or sell,
transfer, otherwise dispose of or request the redemption of the Escrowed Securities and apply the
proceeds therefrom to purchase Refunded Bonds or Government Obligations which do not
permit the redemption thereof at the option of the obligor, and in connection therewith the Issuer
reserves the right to call for redemption prior to maturity any of the Refunded Bonds to the
extent permitted by their authorizing order. The Issuer may, in connection with such transaction,
withdraw funds or Escrowed Securities from the Escrow Fund. Any such transaction may be
effected by the Escrow Agent only if (a) the Escrow Agent shall have received a written opinion
from a nationally recognized firm of certified public accountants that such transaction will not
cause the amount of money and securities in the Escrow Fund to be reduced below an amount
sufficient to provide for the full and timely payment of principal of, redemption premium on and
interest on all of the remaining Refunded Bonds as they become due, taking into account any
optional redemption thereof exercised by the Issuer in connection with such transaction; (b) the
Escrow Agent shall have received the unqualified written legal opinion of nationally recognized
bond counsel or tax counsel to the effect that such transaction will not cause any of the
Refunding Bonds or Refunded Bonds to be an "arbitrage bond" within the meaning of Section
148 of the Internal Revenue Code of 1986, as amended or, if applicable, Section 103(c) of the
Internal Revenue Code of 1954, as amended and (c) notice of such transaction is provided to the
rating agencies, if any, which have rated the Refunded Bonds.
Article 5. Application of Cash Balances.
Section 5.1 In General.
Except as provided in Section 3.2 and Section 4.2 hereof, no withdrawals,
transfers, or reinvestment shall be made of cash balances in the Escrow Fund. Cash balances
shall be held by the Escrow Agent as cash and as cash balances as shown on the books and
records of the Escrow Agent and shall not be reinvested by the Escrow Agent.
Article 6. Redemption of Refunded Bonds.
Section 6.1 Call for Redemption.
The Issuer hereby irrevocably calls the Refunded Bonds for redemption on their
earliest redemption dates, as shown in the Verification Report and on Appendix "A" attached
hereto.
Section 6.2 Notice of Redemption.
The Escrow Agent agrees to give notice of the redemption of the Refunded Bonds
pursuant to the terms of the Refunded Bonds and in substantially the form attached hereto as
Page 6 - Escrow Deposit Agreement J:\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doc
168 2671
Appendix A attached her The Escrow Agent hereby acknowledges that provision satisfactory
and acceptable to the Escrow Agent has been made for the giving of notice of redemption of the
Refunded Bonds.
Article 7. Records and Reports.
Section 7.1 Records.
The Escrow Agent will keep books of record and account in which complete and
accurate entries shall be made of all transactions relating to the receipts, disbursements,
allocations and application of the money and Escrowed Securities deposited to the Escrow Fund
and all proceeds thereof, and such books shall be available for inspection during business hours
and after reasonable notice.
Section 7.2 Reports.
While this Agreement remains in effect, the Escrow Agent annually shall prepare
and send to the Issuer a written report summarizing all transactions relating to the Escrow Fund
during the preceding year, including, without limitation, credits to the Escrow Fund as a result of
interest payments on or maturities of the Escrowed Securities and transfers from the Escrow
Fund for payments on the Refunded Bonds or otherwise, together with a detailed statement of all
Escrowed Securities and the cash balance on deposit in the Escrow Fund as of the end of such
period.
Article 8. Concerning the Paying Agents and Escrow Agent
Section 8.1 Representations.
The Escrow Agent hereby represents that it has all necessary power and authority
to enter into this Agreement and undertake the obligations and responsibilities imposed upon it
herein, and that it will carry out all of its obligations hereunder.
Section 8.2 Limitation on Liability.
The liability of the Escrow Agent to transfer funds for the payment of the
principal of and interest on the Refunded Bonds shall be limited to the proceeds of the Escrowed
Securities and the cash balances from time to time on deposit in the Escrow Fund.
Notwithstanding any provision contained herein to the contrary, the Escrow Agent shall have no
liability whatsoever for the insufficiency of funds from time to time in the Escrow Fund or any
failure of the obligors of the Escrowed Securities to make timely payment thereon, except for the
obligation to notify the Issuer promptly of any such occurrence.
The recitals herein and in the proceedings authorizing the Refunding Bonds shall
be taken as the statements of the Issuer and shall not be considered as made by, or imposing any
obligation or liability upon, the Escrow Agent.
Page 7 - Escrow Deposit Agreement J\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doe
168 °- 2672
The Escrow Agent is not a party to the proceedings authorizing the Refunding
Bonds or the Refunded Bonds and is not responsible for nor bound by any of the provisions
thereof (except to the extent that the Escrow Agent may be a place of payment and paying agent
and/or a paying agent/registrar therefor). In its capacity as Escrow Agent, it is agreed that the
Escrow Agent need look only to the terms and provisions of this Agreement.
The Escrow Agent makes no representations as to the value, conditions or
sufficiency of the Escrow Fund, or any part thereof, or as to the title of the Issuer thereto, or as to
the security afforded thereby or hereby, and the Escrow Agent shall not incur any liability or
responsibility in respect to any of such matters.
It is the intention of the parties hereto that the Escrow Agent shall never be
required to use or advance its own funds or otherwise incur personal financial liability in the
performance of any of its duties or the exercise of any of its rights and powers hereunder.
The Escrow Agent shall not be liable for any action taken or neglected to be taken
by it in good faith in any exercise of reasonable care and believed by it to be within the discretion
or power conferred upon it by this Agreement, nor shall the Escrow Agent be responsible for the
consequences of any error of judgment; and the Escrow Agent shall not be answerable except for
its own action, neglect or default, nor for any loss unless the same shall have been through its
negligence or want of good faith.
Unless it is specifically otherwise provided herein, the Escrow Agent has no duty
to determine or inquire into the happening or occurrence of any event or contingency or the
performance or failure of performance of the Issuer with respect to arrangements or contracts
with others, with the Escrow Agent's sole duty hereunder being to hold the Escrow Fund, to
dispose of and deliver the same in accordance with this Agreement. If, however, the Escrow
Agent is called upon by the terms of this Agreement to determine the occurrence of any event or
contingency, the Escrow -Agent shall be obligated, in making such determination, only to
exercise reasonable care and diligence, and in event of error in making such determination the
Escrow Agent shall be liable only for its own misconduct or its negligence. In determining the
occurrence of any such event or contingency the Escrow Agent may request from the Issuer or
any other person such reasonable additional evidence as the Escrow Agent in its discretion may
deem necessary to determine any fact relating to the occurrence of such event or contingency,
and in this connection may make inquiries of, and consult with, among others, the Issuer at any
time.
Section 8.3 Compensation.
The Issuer shall pay to the Escrow Agent fees for performing the services
hereunder and for the expenses incurred or to be incurred by the Escrow Agent in the
administration of this Agreement pursuant to the terms of its fee schedule. The Escrow Agent
hereby agrees that in no event shall it ever assert any claim or lien against the Escrow Fund for
Page 8 - Escrow Deposit. Agreement J:\RDR\DESCHUPE.CO\GOAdvRet98\eda.doe
168 , 2613
any fees for its services, whether regular or extraordinary, as Escrow Agent, or in any other
capacity, or for reimbursement for any of its expenses as Escrow Agent or in any other capacity.
Section 8.4 Successor Escrow Agents.
If at any time the Escrow Agent or its legal successor or successors should
become unable, through operation of law or otherwise, to act as escrow agent hereunder, or if its
property and affairs shall be taken under the control of any state or federal court or administrative
body because of insolvency or bankruptcy or for any other reason, a vacancy shall forthwith exist
in the office of Escrow Agent hereunder. In such event the Issuer, by appropriate action,
promptly shall appoint an Escrow Agent to fill such vacancy. If no successor Escrow Agent
shall have been appointed by the Issuer within 60 days, a successor may be appointed by the
owners of a majority in principal amount of the Refunded Bonds then outstanding by an
instrument or instruments in writing filed with the Issuer, signed by such owners or by their duly
authorized attorneys -in -fact. If, in a proper case, no appointment of a successor Escrow Agent
shall be made pursuant to the foregoing provisions of this section within three months after a
vacancy shall have occurred, the owner of any Refunded Bond may apply to any court of
competent jurisdiction to appoint a successor Escrow Agent. Such court may thereupon, after
such notice, if any, as it may deem proper, prescribe and appoint a successor Escrow Agent.
Any successor Escrow Agent shall be a corporation organized and doing business
under the laws of the United States or the State of Oregon, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at least $25,000,000
and subject to the supervision or examination by federal or state authority.
Any successor Escrow Agent shall execute, acknowledge and deliver to the Issuer
and the Escrow Agent an instrument accepting such appointment hereunder, and the Escrow
Agent shall execute and deliver an instrument transferring to such successor Escrow Agent,
subject to the terms of this Agreement, all the rights, powers and trusts of the Escrow Agent
hereunder. Upon the request of any such successor Escrow Agent, the Issuer shall execute any
and all instruments in writing for more fully and certainly vesting in and confirming to such
successor Escrow Agent all such rights, powers and duties.
. The obligations assumed by the Escrow Agent pursuant to this Agreement may be
transferred by the Escrow Agent to a successor Escrow Agent if (a) the requirements of this
Section 8.4 are satisfied; (b) the successor Escrow Agent has assumed all the obligations of the
Escrow Agent under this Agreement; and (c) all of the Escrowed Securities and money held by
the Escrow Agent pursuant to this Agreement have been duly transferred to such successor
Escrow Agent.
Section 8.5 Successor Escrow Agent by Merger, Consolidation, Transfer or Sale.
Should the Escrow Agent consolidate, merge with, transfer or sell substantially all
of its corporate trust business to any bank or banks, trust company or other banking institution,
Page 9 - Escrow Deposit Agreement l:\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doc
168 - 2674
such consolidation, merger, transfer or sale shall in no way affect the rights of the parties hereto,
or the owners of any of the Refunding Bonds or Refunded Bonds, and such succeeding
corporation shall be the Escrow Agent under this Agreement, without the execution or filing of
any paper or any further act on the part of the parties hereto, anything in this Agreement to the
contrary notwithstanding.
Article 9. Miscellaneous
Section 9.1 Notice.
Any notice, authorization, request, or demand required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given when mailed by
registered or certified mail, postage prepaid addressed to the Issuer or the Escrow Agent at the
address shown on Exhibit A attached hereto. The United States Post Office registered or
certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date
and fact of delivery. Any party hereto may change the address to which notices are to be
delivered by giving to the other parties not less than ten (10) days prior notice thereof.
Section 9.2 Termination of Responsibilities.
Upon the taking of all the actions as described herein by the Escrow Agent, the
Escrow Agent shall have no further obligations or responsibilities hereunder to the Issuer, the
owners of the Refunded Bonds or to any other person or persons in connection with this
Agreement.
Section 9.3 Binding Agreement.
This Agreement shall be binding upon the Issuer and the Escrow Agent and their
respective successors and legal representatives, and shall inure solely to the benefit of the owners
of the Refunded Bonds, the Issuer, the Escrow Agent and their respective successors and legal
representatives.
Section 9.4 Severability.
In case any one or more of the provisions contained in this Agreement shall for
any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provisions of this Agreement, but this Agreement
shall be construed as if such invalid or illegal or unenforceable provision had never been
contained herein.
Section 9.5 Oregon Law Governs.
This Agreement shall be governed exclusively by the provisions hereof and by the
applicable laws of the State of Oregon.
Page 10 - Escrow Deposit Agreement ):\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doc
168 2675
Section 9.6 Time of the Essence.
Time shall be of the essence in the performance of obligations from time to time
imposed upon the Escrow Agent by this Agreement.
Section 9.7 Notice to Moody's.
In the event that this agreement or any provision thereof is severed, amended or
revoked, the Issuer shall provide written notice of such severance, amendment or revocation to
Moody's Investors Service at 99 Church Street, New York, New York, 10007, Attention: Public
Finance Rating Desk/Refunded Bonds.
Section 9.8 Amendments.
This Agreement shall not be amended except to cure any ambiguity or formal
defect or omission in this Agreement. No amendment shall be effective unless the same shall be
in writing and signed by the parties thereto. No such amendment shall be made unless a prior
written opinion of a nationally recognized bond counsel is rendered which opines that the
amendment shall not adversely affect the rights of the holders of the Refunding Bonds or the
Refunded Bonds. No such amendment shall be made without first receiving written
confirmation from the rating agencies (if any), which have rated the Refunded Bonds that such
administrative changes will not result in a withdrawal or reduction of its rating then assigned to
the Refunded Bonds. If this Agreement is amended, prior written notice and copies of the
proposed changes shall be given to the rating agencies which have rated the Refunded Bonds.
EXECUTED as of the date first written above.
Deschutes County
Finance Director
U.S. Bank Trust National Association
as Escrow Agent
Authorized Officer
Page 11 - Escrow Deposit Agreement J-\RDR\DESCHUTE.CO\GOAdvRef.98\eda.doc
168 2676
Issuer:
Escrow Agent:
EXHIBIT A
Addresses of the Issuer and Escrow Agent
Deschutes County
1164 N.W. Bond Street
Bend, Oregon 97701
Attention: Finance Director
U.S. Bank Trust National Association
U.S. Bancorp Tower, 6th Floor
555 S.W. Oak, PL6
Portland, OR 97204
Attention: Corporate Trust Department
Page 1 - Exhibit A
168 2677
EXHIBIT B
Description of the Refunded Bonds
Deschutes County General Obligation Bonds, Series 1992 maturing on and after
December 1, 2003
Page 1 - Exhibit B
168 - 2678
EXHIBIT C
Schedule of Debt Service on Refunded Bonds
Period Ending
Interest
Principal
Redeemed
Redemption
Premium
Total
Dec 1, 1998
133,771.25
133,771.25
Jun 1, 1999
133,771.25
133,771.25
Dec , 1999
133,771.25
133,771.25
Jun 1, 2000
133,771.25
133,771.25
Dec 1, 2000
133,771.25
1335771.25
Jun 1, 2001
133,771.25
133,771.25
Dec 1, 2001
133,771.25
133,771.25
Jun 1, 2002
133,771.25
133,771.25
Dec 1, 2002
133,771.25
4,625,000.00
46,250.00
4,805,021.25
TOTAL
1,203,941.25
4,625,000.00
46,250.00
5,875,191.25
Page 1 - Exhibit C
168 v 2679
EXHIBIT D
Escrow Deposit
I. Cash
II. State and Local Government Series Obligations
Principal Amount Interest Rate Maturity Date
Page 1 - Exhibit D
EXHIBIT E
Escrow Fund Cash Flow
[to be provided by Verification Agent.]
Page 1 - Exhibit E
168 - 2680
p
168 2681
APPENDIX A
Notice of Redemption
General Obligation Bonds, Series 1992
NOTICE IS HEREBY GIVEN Deschutes County has called for redemption on
December 1, 2002, all of its then outstanding Deschutes County General Obligation Bonds,
Series 1992 (the "Bonds").
The Bonds will be redeemed at a price of one hundred one percent (101%) of their
principal amount, plus interest accrued to December 1, 2002. The redemption price of the Bonds
is payable on presentation and surrender of the Bonds at the office of-
U.S.
£
U.S. Bank Trust National Association
U.S. BankCorp Tower, 6th Floor
555 S.W. Oak, PL6
Portland, OR 97204
Interest on all Bonds or portions thereof which are redeemed shall cease to accrue
on December 1, 2002.
The following Bonds are being redeemed:
Maturity Date Principal Amount Interest Rate CUSIP Number
2003
$345,000
5.25%
2004
365,000
5.40
2005
390,000
5.50
2006
415,000
5.60
2007
440,000
5.75
2008
470,000
5.90
2009
500,000
6.00
2010
530,000
6.00
2011
565,000
6.00
2012
605,000
6.00
By Order of Deschutes County
U.S. Bank Trust National Association, as Paying Agent
Dated:
Under the Interest and Dividend Tax Compliance Act of 1983, payor may be
required to withhold 31 % of the redemption price from any Bondowner who fails to provide to
payor and certify under penalties of perjury, a correct taxpayer identifying number (employer
Page 1 - Appendix A(1)
168 v 2682
identification number or social security number, as appropriate) or an exemption certificate on or
before the date the Bonds are presented for payment. Bondowners who wish to avoid the
application of these provisions should submit a completed Form W-9 when presenting their
Bonds.
Page 2 - Appendix A(1)