2002-1125-Resolution No. 2002-084 Recorded 8/15/2002REVIEWED
COUNTY OFFICIAL
MARYHSUE SPENHOLLOW, COUNTYRCLERKS Q 2002.1125
COMMISSIONERS' JOURNAL AA/A/IMM 4862117 AM
11111111111111111111111111111111
20020021255
For Recording Stamp Only
BEFORE THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY,
OREGON
A RESOLUTION AUTHORIZING
ISSUANCE AND SALE OF
GENERAL OBLIGATION REFUNDING
BONDS, SERIES 2002.
* RESOLUTION NO. 2002-084
WHEREAS, the County is authorized pursuant to the Oregon Constitution and
laws of the State of Oregon to issue refunding bonds to refund its outstanding general obligation
bonds; and
WHEREAS, issuing refunding bonds to refund all or a portion of the following
outstanding County general obligation bonds (collectively, the "Refundable Bonds") may benefit
the County and its taxpayers by reducing debt service costs: (1) General Obligation Bonds, 1993
Series B (the "1993 Bonds"), (2) General Obligation Bonds, 1996 Series A dated March 1, 1996
and issued to finance public safety facilities and court improvements (the "1996 Public Safety
Bonds"), and (3) General Obligation Bonds, Series 1996 dated October 1, 1996 and issued to
finance fairground facilities (the "1996 Fair Bonds" collectively, with the 1996 Public Safety
Bonds, the "1996 Bonds"); and
WHEREAS, pursuant to ORS 288.620 the approval of the State Treasurer is
required before such refunding bonds may be issued to refund the 1996 Bonds because the
refunding of the 1996 Bonds constitutes an advance refunding; and,
WHEREAS, 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 of the 1996 Bonds; and,
WHEREAS, Seattle -Northwest Securities Corporation has prepared a refunding
plan for the 1996 Bonds; and
WHEREAS, the County expects to issue refunding bonds to refund all or a
portion of the 1993 Bonds and refunding bonds to refund all or a portion of the 1996 Public
Page I of 36 — RESOLUTION NO. 2002-084 (8/14/02)
Safety Bonds and all or a portion of the 1996 Fair Bonds if the State Treasurer approves of the
refunding; now, therefore,
BE IT RESOLVED by the Board of Commissioners of Deschutes County as follows:
Section 1. Plan Submission; Experts.
Seattle -Northwest Securities Corporation is hereby appointed underwriter for the
proposed refunding bonds. Western Financial Group, LLC is hereby appointed financial advisor
and is hereby authorized, on behalf of the County, to submit a refunding plan for the 1996 Bonds
to the State Treasurer for review and approval, Preston Gates & Ellis LLP is appointed bond
counsel, and U.S. Trust is appointed as paying agent and registrar (the "Paying Agent").
Section 2. Bonds Authorized.
For the above purpose, the County shall issue its General Obligation Refunding
Bonds, Series 2002 (the "Refunding Bonds") to refund all or a portion of the 1993 Bonds, the
1996 Public Safety Bonds or the 1996 Fair Bonds. The Refunding Bonds may only be issued to
refund the 1996 Bonds upon approval by the State Treasurer. The Refunding Bonds may be
issued in one or more series. The Finance Director or other designee of the Board (the "County
Official"), on behalf of the County, and without further action by the Board of Commissioners,
may:
2.1. Participate in the preparation and authorize the distribution of a preliminary
official statement or other disclosure document for the Refunding Bonds;
2.2. Appoint an escrow verification agent to provide services in connection with
the Refunding Bonds;
2.3. Negotiate the terms of, and execute, a bond purchase agreement with the
underwriter;
2.4. Establish the principal amount, interest rates, redemption terms, payment
dates and other terms of the Refunding Bonds; provided that the Refunding Bonds are sold at a
true interest cost of not to exceed 6%, and provided that the Refunding Bonds issued to refund
the 1996 Public Safety Bonds and the 1996 Fair Bonds must produce debt service savings having
a present value of not less than three percent of the principal amount of the respective Refunding
Bonds;
2.5. Determine whether to issue the Refunding Bonds in one or more series;
2.6. Select which series of Refundable Bonds to refund and which maturities of
the Refundable Bonds to refund;
2.7. Irrevocably call for redemption all or certain series of the Refundable Bonds
on the earliest date on which such Refundable Bonds are subject to redemption;
Page 2 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
2.8. Execute and deliver an escrow deposit agreement (the "Escrow Deposit
Agreement"), in substantially the form attached as Exhibit B, with such changes as the County
Official finds are in the best interests of the County, and authorize the purchase of securities to be
held under the Escrow Deposit Agreement;
2.9. Determine whether the Refunding Bonds are "qualified tax-exempt
obligations" pursuant to Section 265(b)(3) of the Internal Revenue Code of 1986, as amended
(the "Code"); and
2.10. Issue, sell and deliver the Refunding Bonds, and execute and deliver any
related certificates or documents that are reasonably required to refund the Refundable Bonds in
accordance with this resolution.
Section 3. Refunding Bond Book -Entry Form.
3.1. The Refunding Bonds shall be initially issued in book -entry form, with no
Refunding Bonds being made available to the Bond owners. The County Official 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:
3.1.1. 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 for each maturity. 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.
3.1.2. 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.
3.2. 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.
3.3. 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:
3.3.1. to any successor depository designated by the County as provided
below;
Page 3 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
3.3.2. to any successor nominee designated by a depository; or
3.3.3. 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.
3.4. 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.
3.5. 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:
3.5.1. 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;
3.5.2. 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;
3.5.3. the selection by DTC of the beneficial interest in Refunding Bonds
to be redeemed prior to maturity; or
3.5.4. 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.
3.6. 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.
Page 4 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
3.7. 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.
3.8. 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.
3.9. 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 4. Optional Redemption.
The County reserves the right to redeem all or any portion of the Bonds as
provided in the Bond Purchase Agreement.
Section 5. Notice of Redemption of Bonds.
5.1. 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
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.
5.2. 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:
5.2.1. the redemption date,
5.2.2. the redemption price,
5.2.3. 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,
Page 5 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
5.2.4. 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
5.2.5. 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.
5.2.6. 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 that are to be redeemed on that date.
5.2.7. 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.
Section 6. Authentication, Registration And Transfer.
6.1. 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.
6.2. 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.
6.3. 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.
6.4. 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 Bond owners 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.
Page 6 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
6.5. 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 Bond owner submits the following to
the Paying Agent:
6.5.1. written instructions for exchange or transfer satisfactory to the
Paying Agent, signed by the Refunding Bond owner or attorney in fact and guaranteed or
witnessed in a manner satisfactory to the Paying Agent; and
6.5.2. the Refunding Bonds to be exchanged or transferred.
6.6. 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.
6.7. 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 Bond owner's name
is listed on the bond register.
6.8. 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.
6.9. The County may alter these provisions regarding registration and transfer by
mailing notification of the altered provisions to all Refunding Bond owners. 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 7. Security For Refunding Bonds.
Pursuant to ORS 288.160 the County may issue general obligation bonds to
refund general obligation bonds that 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.
Page 7 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
Section 8. Refunding Bond Credit Enhancement.
The County Official may apply for credit enhancement for the Refunding Bonds,
and may expend Refunding Bond proceeds to pay any premium or fee for such credit
enhancement.
Section 9. 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 County Official. 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 10. Execution.
The Refunding Bonds shall be executed on behalf of the County with the
facsimile signatures of the Chair and the County Official.
Section 11. Tax -Exempt Status.
11.1. 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 Code so that interest paid on the Refunding Bonds will not be includable in gross income of
the bond owners. The County specifically covenants:
11.1.1. 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;
11.1.2. to yield restrict and pay any rebates due to the United States on
any unexpended proceeds of the Refundable Bonds; and
11.1.3. to operate the facilities which were financed with the proceeds of
the Refundable Bonds, and any facilities that 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.
11.2. The County Official may enter into covenants on behalf of the County to
protect the tax-exempt status of the Refunding Bonds.
Section 12. Escrow.
The net proceeds of the Refunding Bonds shall be placed in irrevocable escrow,
pursuant to the Escrow Deposit Agreement. The Escrow Agent and the County Official are
hereby authorized to subscribe for and purchase the government obligations to be placed in the
escrow, on behalf of the County.
Page 8 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
Section 13. Defeasance.
If the County:
13.1. 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,
13.2. 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,
13.3. 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 14th day of August, 2002.
BOARD OF COUNTY COMMISSIONERS OF
DESCHUTES COUNTY, OREGON
"00
M AEL M. DALY, C mmissioner
ATTEST:
rrt� 0111 1.
Recording Secretary
Page 9 of 36 — RESOLUTION NO. 2002-084 (8/14/02)
No. R-<<BondNumber>>
EXHIBIT A
(Form of Bond)
United States of America
Deschutes County, Oregon
General Obligation Refunding Bonds
Series 2002
Dated Date: 12002
Interest Rate Per Annum: «CouponRate>>%
Maturity Date: aMaturityYear>>
CUSIP Number: «CUSIPNumbr»
Registered Owner: -----Cede & Co. -----
Principal Amount:-----«PrincipalAmtSpelled>> Dollars -----
$«Princ ipalAmtNumber»
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 indicated above
on the Maturity Date indicated above together with interest thereon from the date hereof at the Interest 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 '200 _. Payment of each installment of principal or interest
shall be made to the Registered Owner hereof whose name appears on the registration books of the County
maintained by the County's paying agent and registrar, which is currently , in
Oregon (the "Registrar") as of the close of business on the fifteenth day of the calendar month immediately
preceding the applicable interest payment date. For so long as this Bond is subject to a book -entry -only system,
principal and interest payments shall be paid on each payment date to the nominee of the securities depository for the
Bonds. On the date of issuance of this Bond, the securities depository for the Bonds is The Depository Trust
Company, New York, New York, and Cede & Co. is the nominee of The Depository Trust Company. Such
payments shall be made payable to the order of "Cede & Co."
This bond is one of a duly authorized series of bonds of the County aggregating $ in
principal amount designated as General Obligation Refunding Bonds, Series 2002 (the "Bonds"). The Bonds are
issued for the purpose of refunding portions of the County's outstanding General Obligation Bonds, Series 1993
Series B, General Obligation Bonds, Series 1996, and General Obligation Bonds, 1996 Series A. The Bonds are
issued under and pursuant to Resolution No. of the County adopted on 12002
(the Resolution"), 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 constitute valid and legally binding obligations of the County. The full faith and credit
of the County are pledged for the punctual payment of the principal of and interest on the Bonds when due. The
County has pledged and is obligated by law to provide for the levy and collection annually of ad valorem taxes
without limitation as to rate or amount on all taxable property within the boundaries of the County to pay the
principal of and interest on the Bonds. The Bonds do not constitute a debt or indebtedness of the State of Oregon or
any political subdivision thereof other than the County.
The Bonds are initially issued as a book -entry -only security issue with no certificates provided to
the beneficial owners. Records of ownership of beneficial interests in the Bonds will be maintained by The
Depository Trust Company and its participants. Should the book -entry only security system be discontinued, the
County shall cause the Registrar to authenticate and deliver replacement Bonds in fully registered form in authorized
denominations in the names of the beneficial owners or their nominees, as provided in the Resolution. Any exchange
or transfer of this Bond must be registered, as provided in the Resolution.
[Insert Redemption Terms]
Unless the book -entry -only system is discontinued, notice of any call for redemption shall be given
as required by the Blanket Issuer Letter of Representations to The Depository Trust Company, as referenced in the
Resolution. Interest on any Bond or Bonds so called for redemption shall cease on the redemption date designated in
the notice. The Registrar will notify The Depository Trust Company of any Bonds called for redemption not less
than 30 days prior to the date fixed for redemption. If the book -entry -only system is discontinued, notice of
redemption shall be given by first-class mail, postage prepaid, not less than thirty days nor more than sixty days prior
to the date fixed for redemption to the Registered Owner of each Bond to be redeemed at the address shown on the
Bond register, as described in the Resolution.
Unless this Bond is presented by an authorized representative of The Depository Trust
Company to the County or the Registrar for registration of transfer, exchange or payment, and any Bond
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.
This Bond shall remain in the Registrar's custody subject to the provisions of the FAST Balance
Certificate Agreement currently in effect between the Registrar and The Depository Trust Company.
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 the 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.
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 County Official as of the date indicated
above.
BOARD OF COUNTY COMMISSIONERS OF
DESCHUTES COUNTY, OREGON
TOM DEWOLF, Chair
DENNIS R. LUKE, Commissioner
MICHAEL M. DALY, Commissioner
THIS BOND SHALL NOT BE VALID UNLESS PROPERLY AUTHENTICATED BY THE
REGISTRAR IN THE SPACE INDICATED BELOW.
CERTIFICATE OF AUTHENTICATION
This is one of the $ aggregate principal amount of Deschutes County,
Oregon General Obligation Refunding Bonds, Series 2002, issued pursuant to the Resolution described herein.
Date of authentication:
Authorized Officer
as Registrar
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.
NOTICE: Signature(s) must be guaranteed by a member of
the New York Stock Exchange or a commercial bank or trust
company
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
TENANT -- 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.
EXHIBIT B
Form of Escrow Deposit Agreement
ESCROW DEPOSIT AGREEMENT
between
Deschutes County,
as Issuer
and
as Escrow Agent
Dated as of , 2002
Deschutes County, Oregon
General Obligation Refunding Bonds, Series 2002
Table of Contents
Article 1. Definitions and Interpretations..................................................................... 3
Section 1.1
Definitions.
3
Section 1.2
Other Definitions.
4
Section 1.3
Interpretations.
4
Article 2. Deposit of Funds and Escrowed Securities ..................................................
4
Section 2.1
Deposits in the Escrow Fund.
4
Article 3. Creation and Operation of Escrow Fund ......................................................
5
Section 3.1
Escrow Fund.
5
Section 3.2
Payment of Principal and Interest.
6
Section 3.3
Sufficiency of Escrow Fund.
6
Section 3.4
Trust Fund.
7
Section 3.5
Cash Balances.
7
Article 4. Limitation on Investments...........................................................................
7
Section 4.1
Investments.
7
Section 4.2
Substitution of Securities.
7
Article 5. Redemption of Refunded Bonds..................................................................
8
Section 5.1
Call for Redemption.
8
Section 5.2
Notice of Redemption.
8
Article 6. Records and Reports....................................................................................
9
Section 6.1
Records.
9
Section 6.2
Reports.
9
Article 7. Concerning the Paying Agents and Escrow Agent ......................................
9
Section 7.1
Representations.
9
Section 7.2
Limitation on Liability.
9
Section 7.3
Compensation.
10
Section 7.4
Successor Escrow Agents.
11
Section 7.5
Successor Escrow Agent by Merger, Consolidation, Transfer or Sale.
11
Article8. Miscellaneous
..............................................................................................
12
Section 8.1
Notice.
12
Section 8.2
Termination of Responsibilities.
12
Section 8.3
Binding Agreement.
12
Section 8.4
Severability.
12
Section 8.5
Oregon Law Governs.
12
Section 8.6
Time of the Essence.
12
Section 8.7
Execution in Counterparts.
12
Section 8.8
Amendments.
13
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
Appendix B
Notice of Defeasance
ESCROW DEPOSIT AGREEMENT
Deschutes County, Oregon
General Obligation Refunding Bonds
Series 2002
THIS ESCROW AGREEMENT, dated as of , 2002
(herein, together with any amendments or supplements hereto, called the "Agreement") is entered
into by and between Deschutes County (herein called the "Issuer") and
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 Resolution No. of the Issuer adopted on
'(the "Authorizing Action"), the Issuer has determined to issue its General
Obligation Refunding Bonds, Series 2002 (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,
Certified Public Accountants, have
prepared a verification report which is dated , 2002 (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 upon
redemption as provided in this Agreement, 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
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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
the Refunded Bonds, the Issuer and the Escrow Agent mutually undertake, promise and agree for
themselves and their respective representatives and successors, as follows:
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Definitions and Interpretations.
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:
1993 Series B.
"1993 Bonds" means the Issuer's callable outstanding General Obligation Bonds,
"1993 Bonds Escrow Fund" means the fund described in Section 3.1(A) that will
be held and administered by the Escrow Agent pursuant to this Agreement.
in Exhibit D.
"1993 Bonds Escrowed Securities" means the Government Obligations described
"1996 Fair Bonds" means the County's callable outstanding General Obligation
Bonds, Series 1996.
"1996 Fair Bonds Escrow Fund" means the fund described in Section 3.1(B) that
will be held and administered by the Escrow Agent pursuant to this Agreement.
"1996 Fair Bonds Escrowed Securities" means the Government Obligations
described in Exhibit D.
"1996 Public Safety Bonds" means the Issuer's callable outstanding General
Obligation Bonds, 1996 Series A.
"1996 Public Safety Bonds Escrow Fund" means the fund described in Section
3.1(C) that will be held and administered by the Escrow Agent pursuant to this Agreement.
"1996 Public Safety Bonds Escrowed Securities" means the Government
Obligations described in Exhibit D.
"Escrow Fund" means the 1993 Bonds Escrow Fund, the 1996 Fair Bonds Escrow
Fund and the 1996 Public Safety Bonds Escrow Fund.
"Escrowed Securities" means the 1993 Bonds Escrowed Securities, the 1996 Fair
Bond Escrowed Securities and the 1996 Public Safety Bonds Escrowed Securities.
"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 , as the paying agent for
the Refunded Bonds.
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"SLGS" means United States Treasury Obligations — State and Local Government
Series purchased from the Department of Treasury Bureau of Public Debt.
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.
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.
Deposit of Funds and Escrowed Securities.
Deposits in the Escrow Fund.
(A) The Escrow Agent has received a wire transfer in the amount of
$ as proceeds of the Refunding Bonds and credited such amount to
the 1993 Bonds Escrow Fund.
(B)
The Escrow Agent has received a wire transfer in the amount of $
as proceeds of the Refunding Bonds and credited such amount to the 1996 Fair
Bonds Escrow Fund.
(C) The Escrow Agent has received a wire transfer in the amount of $
as proceeds of the Refunding Bonds and credited such amount to the 1996 Public
Safety Bonds Escrow Fund.
Escrowed Securities.
(A) The Escrow Agent has used all of the amounts in the 1993 Bonds
Escrow Fund to purchase the 1993 Bonds Escrowed Securities. By signing this
Agreement the Escrow Agent acknowledges receipt of the wire transfer and the receipt of
the 1993 Bonds Escrowed Securities.
(B) The Escrow Agent has used all of the amounts in the 1996 Fair
Bonds Escrow Fund to purchase the 1996 Fair Bonds Escrowed Securities. By signing
this Agreement the Escrow Agent acknowledges receipt of the wire transfer and the
receipt of the 1996 Fair Bonds Escrowed Securities.
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(C) The Escrow Agent has used all of the amounts in the 1996 Public
Safety Escrow Fund to purchase the 1996 Public Safety Escrowed Securities. By signing
this Agreement the Escrow Agent acknowledges receipt of the wire transfer and the
receipt of the 1996 Public Facilities Escrowed Securities.
Creation and Operation of Escrow Fund.
Escrow Fund.
(A) The Escrow Agent has created on its books a special trust fund and
irrevocable escrow to be known as the Deschutes County General Obligation Bonds,
1993 Series B Escrow Fund (the "1993 Bonds Escrow Fund"). The Escrow Agent hereby
agrees that upon receipt thereof it will deposit to the credit of the 1993 Bonds Escrow
Fund the funds and the 1993 Bonds Escrowed Securities. Such deposit, all proceeds
therefrom, and all cash balances from time to time on deposit therein (a) shall be the
property of the 1993 Bonds 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 1993 Bonds, which payment shall be
made by timely transfers of such amounts at such times as are provided for in 0(A)
hereof. When the final transfers have been made for the payment of such principal of and
interest on the 1993 Bonds, any balance then remaining in the 1993 Bonds Escrow Fund
shall be transferred to the Issuer, and the Escrow Agent shall thereupon be discharged
from any further duties hereunder.
(B) The Escrow Agent has created on its books a special trust fund and
irrevocable escrow to be known as the Deschutes County General Obligation Bonds,
Series 1996 Escrow Fund (the "1996 Fair Bonds Escrow Fund"). The Escrow Agent
hereby agrees that upon receipt thereof it will deposit to the credit of the 1996 Fair Bonds
Escrow Fund the funds and the 1996 Fair Bonds Escrowed Securities. Such deposit, all
proceeds therefrom, and all cash balances from time to time on deposit therein (a) shall be
the property of the 1996 Fair Bonds 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 1996 Fair
Bonds, which payment shall be made by timely transfers of such amounts at such times as
are provided for in 0(B) hereof. When the final transfers have been made for the payment
of such principal of and interest on the 1996 Fair Bonds, any balance then remaining in
the 1996 Fair Bonds Escrow Fund shall be transferred to the Issuer, and the Escrow Agent
shall thereupon be discharged from any further duties hereunder.
(C) The Escrow Agent has created on its books a special trust fund and
irrevocable escrow to be known as the Deschutes County General Obligation Bonds,
1996 Series A Escrow Fund (the "1996 Public Safety Bonds Escrow Fund"). The Escrow
Agent hereby agrees that upon receipt thereof it will deposit to the credit of the 1996
Public Safety Bonds Escrow Fund the funds and the 1996 Public Safety Bonds Escrowed
Securities. Such deposit, all proceeds therefrom, and all cash balances from time to time
on deposit therein (a) shall be the property of the 1996 Public Safety Bonds Escrow Fund,
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(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 1996 Public Safety Bonds, which payment shall be made by timely
transfers of such amounts at such times as are provided for in 0(C) hereof. When the
final transfers have been made for the payment of such principal of and interest on the
1996 Public Safety Bonds, any balance then remaining in the 1996 Public Safety Bonds
Escrow Fund shall be transferred to the Issuer, and the Escrow Agent shall thereupon be
discharged from any further duties hereunder.
Payment of Principal and Interest.
(A) 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 1993 Bonds
Escrow Fund, the amounts required to pay the principal of the 1993 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.
(B) 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 1996 Fair
Bonds Escrow Fund, the amounts required to pay the principal of the 1996 Fair 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.
(C) 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 1996 Public
Safety Bonds Escrow Fund, the amounts required to pay the principal of the 1996 Public
Safety 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.
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 are paid on the respective optional
redemption dates and any redemption premium payable upon the optional 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 0 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
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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.
Trust Fund.
(A) 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.
(B) The Escrow Agent shall hold at all times the 1993 Bonds Escrow
Fund, the 1993 Bonds Escrowed Securities and all other assets of the 1993 Bonds Escrow
Fund, in trust for the benefit of the owners of the 1993 Bonds.
(C) The Escrow Agent shall hold at all times the 1996 Fair Bonds
Escrow Fund, the 1996 Fair Bonds Escrowed Securities and all other assets of the 1996
Bonds Escrow Fund, in trust for the benefit of the owners of the 1996 Bonds.
(D) The Escrow Agent shall hold at all times the 1996 Public Safety
Escrow Fund, the 1996 Public Safety Escrowed Securities and all other assets of the 1996
Public Safety Bonds Escrow Fund, in trust for the benefit of the owners of the 1996
Public Safety Bonds Escrow Fund.
Cash Balances.
Cash balances from time to time on deposit in the Escrow Fund shall be held in
currency in the United States of America.
Limitation on Investments.
Investments.
Except for the initial investment in the Escrowed Securities as provided in Exhibit
D, and except as provided in 0 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.
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
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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.
Redemption of Refunded Bonds.
Call for Redemption.
The Issuer hereby irrevocably calls:
(A) the Issuer's General Obligation Bonds, 1993 Series B which
mature on or after December 1, 2003 for redemption on their earliest redemption date,
which is December 1, 2002; and
(B) the Issuer's General Obligation Bonds, Series 1996 which mature
on or after December 1, 2007 for redemption on their earliest redemption date, which is
December 1, 2006; and
(C) the Issuer's General Obligation Bonds, 1996 Series A which
mature on or after December 1, 2007 for redemption on their earliest redemption date,
which is December 1, 2006.
Notice of Defeasance and Redemption.
(A) The Escrow Agent agrees to cause the Paying Agent to give notice
of the defeasance of the 1996 Fair Bonds substantially in the forms attached hereto as
Appendix B-1 and B-2 promptly upon delivery of the Refunding Bonds.
(B) The Escrow Agent agrees to give notice of the redemption of the
1993 Bonds pursuant to the terms of the 1993 Bonds and in substantially the form
attached hereto as Appendix A-1 attached hereto.
(C) The Escrow Agent agrees to give notice of the redemption of the
1996 Fair Bonds pursuant to the terms of the 1996 Fair Bonds and in substantially the
form attached hereto as Appendix A-2 attached hereto.
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(D) The Escrow Agent agrees to give notice of the redemption of the
1996 Public Safety Bonds pursuant to the terms of the 1996 Public Safety Bonds and in
substantially the form attached hereto as Appendix A-3 attached hereto.
Records and Reports.
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.
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.
Concerning the Paying Agents and Escrow Agent
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.
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.
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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.
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
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.
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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 0 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.
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,
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.
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Miscellaneous
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.
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.
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.
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.
Oregon Law Governs.
This Agreement shall be governed exclusively by the provisions hereof and by the
applicable laws of the State of Oregon.
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.
Execution in Counterparts.
This Agreement may be simultaneously executed in multiple counterparts, all of which shall
constitute one and the same instrument and each of which shall be deemed to be an original.
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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 that have rated the Refunded Bonds.
EXECUTED as of the date first written above.
Deschutes County, Oregon
County Official
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EXECUTED as of the date first written above.
as Escrow Agent
Authorized Officer
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Issuer:
Escrow Agent:
EXHIBIT A
Addresses of the Issuer and Escrow Agent
Deschutes County
1340 N.W. Wall
Bend, OR 97701
Attention: Finance Director
Attention:
Page 1 - Exhibit A
EXHIBIT B
Description of the Refunded Bonds
General Obligation Bonds, 1993 Series B maturing on or after December 1, 2003.
2. General Obligation Bonds, Series 1996 maturing on or after December 1, 2007.
3. General Obligation Bonds, 1996 Series A maturing on or after December 1, 2007.
Page 1 - Exhibit B
EXHIBIT C
Schedule of Debt Service on Refunded Bonds
Payment Date Interest Principal Total
Page 1 - Exhibit C
EXHIBIT D
Escrow Deposit
I. Cash
II. State and Local Government Series Obligations
Purchase Date Principal Amount Interest Rate Maturity Date
Page 1 - Exhibit D
EXHIBIT E
Escrow Fund Cash Flow
Net Escrow
Date Principal Interest Rollovers Receipts
Page 1 - Exhibit E
APPENDIX A
Notice of Redemption
Deschutes County, Oregon
NOTICE IS HEREBY GIVEN that Deschutes County has called for redemption
on , all of its then outstanding General Obligation Bonds,
(the "Bonds").
The Bonds will be redeemed at a price of percent (100%) of their
principal amount, plus interest accrued to . The redemption
price of the Bonds is payable on presentation and surrender of the Bonds at the office of:
Interest on all Bonds or portions thereof that are redeemed shall cease to accrue on
The following Bonds are being redeemed:
Principal Date of Maturity Interest CUSIP
Amount (December 11 Rate Number
By Order of Deschutes County, Oregon
r
Dated:
as Escrow Agent
Under Section 3406(a)(1) of the Internal Revenue Code the Registrar may be
obligated to withhold a percentage of the principal of a holder who has failed to furnish the
Registrar with a valid taxpayer identification number and a certification that the owner is not
subject to backup withholding. Owners who wish to avoid the application of these provisions
should submit a completed IRS Form W-9 when presenting their certificates for payment.
Page 1 - Appendix A
Appendix B
Notice of Defeasance
Deschutes County, Oregon
Page 1 - Appendix A