HomeMy WebLinkAboutMINUTES - 04052011 - SD.3RECOMMENDATION(S):
1. ADOPT Resolution No. 2011/142 approving and authorizing the County Administrator to
execute a Financing Agreement for the purchase of East Bay Regional Communication
System Authority (EBRCSA) 2011 Series B Revenue Bonds with an anticipated par amount
of 2,455,113.76, not to exceed $3,000,000 for the Contra Costa County share of funding for
final infrastructure construction costs of the East Bay Regional Communication System
(EBRCS).
2. APPROVE and AUTHORIZE the County Administrator, or designee, to prepay the
"Service Payment", in an amount not to exceed $1,800,000, for the County Costa County
share of remaining infrastructure construction costs of the EBRCS pursuant to the Project
Operating Agreement between the EBRCSA and the County approved by the Board of
Supervisors on December 14, 2010.
3. APPROVE Appropriation Adjustment No. 5026 authorizing new revenue in Plant
Acquisition (0111) in the amount of $4.26 million from the General Fund-Reserve For
Contingencies (Capital Reserve) and appropriate for the purchase of EBRCSA 2011 Series
B Revenue Bonds and prepayment of the County "Service Payment".
APPROVE OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
Action of Board On: 04/05/2011 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF SUPERVISORS
AYE:John Gioia, District I Supervisor
Gayle B. Uilkema, District II
Supervisor
Mary N. Piepho, District III
Supervisor
Karen Mitchoff, District IV
Supervisor
Federal D. Glover, District V
Supervisor
Contact: Lisa Driscoll, 925-335-1023
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the
Board of Supervisors on the date shown.
ATTESTED: April 5, 2011
David J. Twa, County Administrator and Clerk of the Board of Supervisors
By: June McHuen, Deputy
cc: ORRICK, HERRINGTON, & SUTCLIFFE LLP - M. COLLINS, KNN PUBLIC FINANCE - M. BREITBART, EBRCS AUTHORITY - B. McCAMMON,
TAMALPAIS ADVISORS - J. BUCKLEY, TREASURER-TAX COLLECTOR - R. WATTS, AUDITOR-CONTROLLER - E. VERIGIN,
SHERIFF-CORONER - M. CASTEN, DEPT. OF INFO. TECH. - E. WOO, COUNTY ADMINISTRATOR - D. TWA, COUNTY ADMINISTRATOR - L.
DRISCOLL
SD. 3
To:Board of Supervisors
From:David Twa, County Administrator
Date:April 5, 2011
Contra
Costa
County
Subject:EAST BAY REGIONAL COMMUNICATION SYSTEM (EBRCS) - FINANCING AGREEMENT
4. Acting as the Governing Board of the Contra Costa County Fire Protection District
(CCCFPD), APPROVE and AUTHORIZE the County Administrator,
RECOMMENDATION(S): (CONT'D)
or designee, to prepay the "Service Payment", in an amount not to exceed $560,000, for
the CCCFPD share of remaining infrastructure construction costs of the EBRCS pursuant
to the Project Operating Agreement between the EBRCSA and the District approved by
the Board of Directors on December 14, 2010.
5. Acting as the Governing Board of the Contra Costa County Fire Protection District,
APPROVE Appropriation Adjustment No. 5028 authorizing new revenue in Contra
Costa County Fire Protection District Operating Fund (7300) in the amount of $560,000
from fund balance and appropriate for the prepayment of the District "Service Payment".
FISCAL IMPACT:
The recommended action appropriates $4.26 million from the General Fund Reserve for
Contingencies; $2.455 million to purchase EBRCSA 2011 Series B Revenue Bonds and
up to $1.80 million for Contra Costa County's share of infrastructure pre-payment.
Because these capital reserve funds are not required for current operations, and because
the County will receive interest payments on the majority of the monies, this transaction
will have no negative impact on the General Fund.
The recommended action also appropriates $560,000 from the Contra Costa County Fire
Protection District for the District's share of infrastructure pre-payment.
BACKGROUND:
The East Bay Regional Communication System (“EBRCS”) is a joint Public Safety radio
communication project, which was initiated by the Counties of Contra Costa and
Alameda. In 2007, the East Bay Regional Communication System Authority
(“EBRCSA”), a joint exercise of powers authority, was formed to further develop and
refine plans for this state-of-the-art communication system and has prepared various
operational analyses and associated cost estimates based on evolving plans. At one time it
was estimated that the project would require in excess of $80 million of external
funding—such as bond financing—to be paid back by the users of the project. Both
Alameda and Contra Costa counties have been successful in acquiring several grants to
partially offset system and project costs, including the Bay Area Super Urban Area
Security Initiative (SUASI), Urban Area Security Initiative (UASI), State Homeland
Security (SHSGP) programs, and Community Oriented Policing Services (COPS) grants
over the course of several years. To date approximately $39 million of grant funds have
been received.
The EBRCSA requires an additional $27.6 million for equipment, installation and
construction activities to complete the system. The Authority anticipates additional
Federal grant revenue of $10.5 million leaving $17.1 million to be secured by other
means. Financial teams from both counties have been working with EBRCSA to
determine the best course of action to fund the remaining $17.1 million to insure
compliance with federal standards. It was determined that the issuance of bonds to cover
the remaining infrastructure costs would be appropriate, but only after giving public
agencies participating in the EBRCS the opportunity to pay a share of the those
remaining infrastructure costs up-front. The remaining amount would be financed by
passing the debt service through to those participating agencies that did not pre-pay, as a
portion of the monthly per-radio user fee outlined in the Project Operating Agreement.
This financing structure was approved in concept by the Board on October 19, 2010.
Today’s action would approve the County to purchase bonds issued by the EBRCSA. Of
the $17.1 million necessary to finalize the system build-out, approximately $11 million in
pre-payments have been received by or committed to EBRCSA by participating agencies
resulting in the need to finance only $6.1 million. The remaining $6.1 million will be
generated by selling Convertible Capital Asset Bonds (CABs) to both counties based on
the number of radios scheduled for use by agencies within each jurisdiction; 60% in
Alameda and 40% in Contra Costa. This works out to approximately $3.7 million and
$2.4 million from Alameda and Contra Costa, respectively. The Alameda County Board
of Supervisors approved a similar Financing Agreement (“Agreement”) resulting in the
purchase of EBRCSA bonds on March 29, 2011.
Through the proposed Agreement, the County will purchase the bonds in April 2011,
begin receiving interest payments semi-annually commencing in December 2013 (with
the first principal payment beginning in June 2014) for a period 16 years, with a final
maturity date of June, 2027. The True Interest Cost (TIC) of this transaction is 4.05%.
Assuming a par amount of $2.455 million, the County would receive approximately $1.1
million in interest, in addition to repayment of the principal, over the term of the bonds.
In addition to the purchase of bonds, the County will pre-pay up to $1.8 million and the
Contra Costa County Fire Protection District (CCCFPD) will pre-pay up to $560,000 in
infrastructure costs resulting in reduced radio User Payments over the life of the bonds.
This will reduce the impact to operations for county departments and the CCCFPD once
the EBRCS is actuated and User Payments are assessed to entities using the system. It is
estimated that pre-payment of the bonds will save the county approximately $231,000
annually over the life of the bonds. The table below shows the impact to county
departments should the infrastructure costs be pre-paid or not pre-paid:
No Pre-Pay Pre-Pay
Department Radio
Count
Monthly
Cost
Annual
Cost
Monthly
Cost
Annual
Cost
Sheriff-Coroner 879 $39,555 $474,660 $26,370 $316,440
Animal
Services 62 2,790 33,480 1,860 22,320
District
Attorney 32 1,440 17,280 960 11,520
Health/EHSD 160 7,200 86,400 4,80 57,600
Public Works 81 3,645 43,740 2,430 29,160
DCD 69 3,105 37,260 2,070 24,840
Total 1,283 $57,735 $692,820 $38,490 $461,880
The use of county reserves in an amount not to exceed $4.26 million; $2.455 million to
purchase the bonds and $1.80 million to pre-pay the county share of infrastructure costs
would be the final step in contributing to the completion of the build-out of the EBRCS
system. The use of reserves for one-time project costs such as the EBRCS project is in
keeping with the County’s Reserve Policy. The recommendation to use reserves would
not have been made if the county was financing a larger EBRCSA funding requirement.
In that case, it would have been in the best interest of the county to issue a separate series
of lease revenue bonds during the financing of the West County Clinic project.
CONSEQUENCE OF NEGATIVE ACTION:
Financing required to complete the buildout of the EBRCS will not be provided to the
EBRCSA.
CHILDREN'S IMPACT STATEMENT:
No impact.
ATTACHMENTS
Resolution No. 2011/142
Resolution No. 2011/142 Exhibit A
EBRCS Financing Agreement
EBRCS Trust Agreement
Revenue Adjustment No. 5026
Appropriation Adjustment No. 5026
Revenue Adjustment No. 5028
Appropriation Adjustment No. 5028
OHS WEST:260976438.14
TRUST AGREEMENT
between the
EAST BAY REGIONAL COMMUNICATIONS SYSTEM AUTHORITY
and
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Trustee
Dated as of October 1, 2010
East Bay Regional Communications System Authority
Revenue Bonds,
2011 Series A
and
2011 Series B
OHS WEST:260976438.14
THIS TRUST AGREEMENT dated as of October 1, 2010 (the “Trust
Agreement”), by and between the EAST BAY REGIONAL COMMUNICATIONS SYSTEM
AUTHORITY (the “Authority”), a joint exercise of powers authority duly organized and existing
pursuant to an Agreement entitled “Joint Exercise of Powers Agreement for the East Bay
Regional Communications System Authority” (the “JPA Agreement”) by and between the
County of Contra Costa, the County of Alameda and certain other public entities, and Deutsche
Bank National Trust Company as trustee hereunder (the “Trustee”),
W I T N E S S E T H:
WHEREAS, the Authority is a joint exercise of powers authority duly organized
and operating pursuant to Chapter 5 of Division 7 of Title 1 of the Government Code of the State
of California (hereinafter, the “Act”);
WHEREAS, Article 4 of the Act authorizes and empowers the Authority to issue
bonds to assist local agencies in financing projects and programs consisting of certain public
improvements or working capital or liability and other insurance needs whenever a local agency
determines that there are significant public benefits from so doing;
WHEREAS, the County of Contra Costa (“Contra Costa”) and the County of
Alameda (“Alameda,” and collectively with Contra Costa, the “Counties”) each following a
public hearing duly noticed and held, has determined that the financing of the Project (as
hereinafter defined) will result in significant public benefits;
WHEREAS, the Authority is empowered pursuant to the aforementioned Article
4 of the Act to borrow money for the purpose of paying the cost of public capital improvements
within the State of California, including a P25 compliant or equivalent communications system
serving Alameda and Contra Costa Counties and individual political jurisdictions therein; and
WHEREAS, the Authority now wishes to borrow money for the purpose of
paying the cost of a P25 compliant or equivalent communications system serving Alameda and
Contra Costa Counties and individual political jurisdictions therein as further described in
Exhibit C hereto (the “Project”);
WHEREAS, the Authority intends to finance the Project by issuing the East Bay
Regional Communications System Authority Revenue Bonds, 2011 Series A (the “Series A
Bonds”) and 2011 Series B (the “Series B Bonds” and, together with the Series A Bonds, the
“Series 2011 Bonds”);
WHEREAS, the Counties will assist the Authority by purchasing the Bonds;
WHEREAS, the Authority has entered into and proposes to enter into operating
agreements (“Operating Agreements”) with the Counties and certain public entities therein that
will use the Project (the “Users”) whereby the Authority will own and operate the Project for the
benefit of the Users, and the Users will pay, pursuant to user fees, the cost of the Project (the
“Service Payments”) and the Authority’s annual operation (the “Operating Payments”)
(collectively, the “User Payments”);
OHS WEST:260976438.14
2
WHEREAS, the Authority has authorized the issuance of the Bonds, in an
aggregate principal amount not to exceed seventeen million dollars ($17,000,000) to assist in
financing the Project;
WHEREAS, the Bonds are to be secured by a pledge of a first lien on the Service
Payments to the extent received by the Authority from the Users pursuant to Operating
Agreements executed by each of them, which Service Payments are anticipated to be sufficient
in time and amount to pay the principal of and interest on the Bonds;
WHEREAS, to provide for the authentication and delivery of the Bonds (as
hereinafter defined), to establish and declare the terms and conditions upon which the Bonds are
to be issued and secured and to secure the full and timely payment of the principal thereof and
premium, if any, and interest thereon, the Authority has authorized the execution and delivery of
this Trust Agreement; and
WHEREAS, the Authority has determined that all acts and proceedings required
by law necessary to make the Bonds, when executed by the Authority and authenticated and
delivered by the Trustee, duly issued and the valid, binding and legal obligations of the Authority
payable in accordance with their terms, and to constitute this Trust Agreement a valid and
binding agreement of the parties hereto for the uses and purposes herein set forth, have been
done and taken, and have been in all respects duly authorized;
NOW, THEREFORE, THIS TRUST AGREEMENT WITNESSETH, that in
order to secure the full and timely payment of the principal of, premium, if any, and the interest
on all Bonds at any time issued and outstanding under this Trust Agreement, according to their
tenor, and to secure the performance and observance of all the covenants and conditions therein
and herein set forth, and to declare the terms and conditions upon and subject to which the Bonds
are to be issued and received, and in consideration of the premises and of the mutual covenants
herein contained and of the purchase and acceptance of the Bonds by the holders thereof, and for
other valuable consideration, the receipt whereof is hereby acknowledged, the Authority does
hereby covenant and agree with the Trustee, for the benefit of the respective holders from time to
time of the Bonds, as follows:
ARTICLE I
DEFINITIONS; EQUAL SECURITY
SECTION 1.01 Definitions. Unless the context otherwise requires, the terms
defined in this Section shall for all purposes hereof and of any Supplemental Trust Agreement
and of any certificate, opinion, request or other document herein or therein mentioned have the
meanings herein specified, unless otherwise defined in such other document. Capitalized terms
not otherwise defined herein shall have the meaning assigned to such terms in the Financing
Agreement.
“Accreted Interest” means, with respect to Capital Appreciation Bonds, as of the
date of calculation, the Accreted Value thereof minus the Denominational Amount thereof.
OHS WEST:260976438.14
3
“Accreted Value” means, with respect to Capital Appreciation Bonds or
Convertible Capital Appreciation Bonds, as of the date of calculation, the Denominational
Amount thereof plus the interest accrued thereon to such date of calculation, compounded from
the date of initial delivery at the interest rate thereof on each June 1 and December 1, to the
Conversion Date or as determined in accordance with the Supplemental Trust Agreement
authorizing such Bonds, assuming in any year that such Accreted Value increases in equal daily
amounts on the basis of a year of three hundred sixty (360) days composed of twelve (12)
months of thirty (30) days each.
“Act” means the Joint Exercise of Powers Act (being Chapter 5 of Division 7 of
Title 1 of the Government Code of the State, as amended) and all laws amendatory thereof or
supplemental thereto.
“Additional Bonds” means all bonds of the Authority authorized by and at any
time Outstanding pursuant hereto and executed, issued and delivered in accordance with
Article III.
“Alameda” means the County of Alameda, a county organized and validly
existing under the Constitution and general laws of the State.
“Authority” means the East Bay Regional Communications System Authority
created pursuant to the Act and its successors and assigns in accordance herewith.
“Authorized Denominations” means, with respect to each Series 2011 Bond,
$100,000 and integral multiples of $1,000 in excess thereof.
“Bond Counsel” means counsel of recognized national standing in the field of
law relating to municipal bonds, appointed by the Authority.
“Bond Fund” means the fund created by that name in Section 5.02 hereof.
“Bond Year” means the twelve (12)-month period ending on the respective
Principal Payment Date of each year of each series to which reference is made.
“Bondholder or “Owner” means any person who shall be the registered owner
of any Outstanding Bond.
“Bonds” means the Series A Bonds and the Series B Bonds and all Additional
Bonds of the Authority authorized by and at any time Outstanding pursuant hereto and executed,
issued and delivered in accordance with Section 2.02(a) and Section 3.01.
“Business Day” means a day that is not a Saturday, Sunday or legal holiday on
which banking institutions in the State of New York or California is authorized to remain closed,
or a day on which the Federal Reserve system is closed.
“Capitalized Interest Account” means the respective account of that name held
by the Trustee for payment of interest payments or the Bond through [December] 2013.
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“Capital Appreciation Bonds” means Bonds the interest on which is
compounded semiannually on each Interest Payment Date and paid at maturity as specified in the
accreted value table for such Bonds in an exhibit to a Supplemental Trust Agreement.
“Certificate of the Authority” means an instrument in writing signed by any of
the following officials of the Authority: Chair of the governing board of the Authority,
Executive Director of the Authority or a designee, or by any other person (whether or not an
officer of the Authority) who is specifically authorized by resolution of the Authority for that
purpose.
“Code” means the Internal Revenue Code of 1986, as amended.
“Contra Costa” means the County of Contra Costa, a county organized and
validly existing under the Constitution and general laws of the State.
“Convertible Capital Appreciation Bonds” means Bonds the interest on which
is compounded semiannually on each Interest Payment Date until a fixed date at which interest
becomes payable on a current basis.
“Conversion Date” means the date on which Convertible Capital Appreciation
Bonds commence accruing current interest on the Accreted Value thereof.
“Costs of Issuance” means all items of expense directly or indirectly payable by
or reimbursable to the County or the Authority and related to the authorization, execution and
delivery of the Financing Agreements, this Trust Agreement and the issuance and sale of the
Bonds, including, but not limited to, costs of preparation and reproduction of documents, fees
and charges of the Trustee, legal fees and charges, fees and disbursements of consultants and
professionals, fees and charges for preparation, execution and safekeeping of the Bonds, fees of
the Authority and any other authorized cost, charge or fee in connection with the issuance of the
Bonds.
“Costs of Issuance Fund” means the fund by that name established pursuant to
Section 3.01.
“Counties” means Alameda and Contra Costa.
“Current Interest Bonds” means Bonds the interest on which is payable on each
Interest Payment Date to the maturity date for each such Bond.
“Debt Service” means, for any Fiscal Year or other period, the sum of (1) the
interest accruing during such Fiscal Year or other period on all Outstanding Bonds, assuming
that all Outstanding Serial Bonds are retired as scheduled and that all Outstanding Term Bonds
are redeemed or paid from sinking fund payments as scheduled (except to the extent that such
interest is to be paid from the proceeds of sale of any Bonds so long as such funded interest is in
an amount equal to the gross amount necessary to pay such interest on the Bonds, (2) the
principal amount of all Outstanding Serial Bonds maturing during such Fiscal Year or other
period, and (3) the principal amount of all Outstanding Term Bonds required to be redeemed or
OHS WEST:260976438.14
5
paid (together with the redemption premiums, if any, thereon) during such Fiscal Year or other
period; provided, that the foregoing shall be subject to adjustment and recalculation as follows:
(a) with respect to Capital Appreciation Bonds, or Convertible Capital
Appreciation Bonds the Accreted Value payment shall be deemed a principal payment
and interest that is compounded and paid as Accreted Value shall be deemed due on the
scheduled redemption or payment date of such Capital Appreciation Bond; and
(b) with respect to Variable Rate Bonds, the interest payments shall be
calculated at a rate equal to 150% of the highest rate borne by such Bonds in the last
12 months, but not to exceed twelve percent (12%) per annum.
“Denominational Amount” means, with respect to Capital Appreciation Bonds,
the initial offering price thereof, which represents the principal amount thereof, and, with respect
to the Current Interest Bonds, the principal amount thereof.
“Event of Default” shall have the meaning specified in Section 7.01.
“Financing Agreement” means an agreement between the Authority and a
County, pursuant to which the County shall purchase the Series 2011 Bonds or a portion thereof.
“Fiscal Year” means the twelve (12)-month period terminating on June 30 of
each year, or any other annual accounting period hereafter selected and designated by the
Authority as its Fiscal Year in accordance with applicable law.
“Fixed Rate Bonds” means Bonds of any Series which bear interest at a fixed
interest rate from the date of such Bonds until the maturity or redemption date thereof.
“Government Securities” means (1) U.S. Treasury Certificates, Notes and
Bonds (including State and Local Government Series – “SLGS”); (2) direct obligations of the
U.S. Treasury which have been stripped by the Treasury itself, such as CATS, TIGRS and
similar securities; (3) Resolution Funding Corp. (REFCORP) strips (interest component only)
which have been stripped by request to the Federal Reserve Bank of New York in book entry
form; (4) pre-refunded municipal bonds rated “Aaa” by Moody's and “AAA” by S&P, or if not
rated by Moody's, then pre-refunded bonds that have been pre-refunded with cash, direct U.S. or
U.S. guaranteed obligations, or AAA-rated pre-refunded municipal obligations; (5) obligations
issued by the following agencies which are backed by the full faith and credit of the U.S.:
(a) U.S. Export-Import Bank direct obligations or fully guaranteed certificates of beneficial
ownership, (b) Farmers Home Administration (FmHA) certificates of beneficial ownership,
(c) Federal Financing Bank, (d) General Services Administration participation certificates,
(e) U.S. Maritime Administration Guaranteed Title XI financing, (f) U.S. Department of Housing
and Urban Development (HUD) Project Notes, Local Authority Bonds, New Communities
Debentures – U.S. government guaranteed debentures, and U.S. Public Housing Notes and
Bonds – U.S. government guaranteed public housing notes and bonds.
“Independent Certified Public Accountant” means any certified public
accountant or firm of such accountants duly licensed and entitled to practice and practicing as
OHS WEST:260976438.14
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such under the laws of the State or another state of the United States of America or a comparable
successor, appointed and paid by the Authority, and who, or each of whom –
(1) is in fact independent according to the Statement of Auditing Standards
No. 1 and not under the domination of the Authority or the County;
(2) does not have a substantial financial interest, direct or indirect, in the
operations of the Authority or the County; and
(3) is not connected with the Authority or the County as a member, officer or
employee of the Authority or the County, but who may be regularly retained to audit the
accounting records of and make reports thereon to the Authority or the County.
“Initial Payments” has the meaning ascribed thereto in the Operating
Agreements.
“Interest Payment Date” means June 1 and December 1 in each year,
commencing December 1, 2013 for the Series 2011 Bonds.
“Interest Payment Period” means the period from and including each Interest
Payment Date (or, for the first Interest Payment Period, the date of the Bonds) to and including
the day immediately preceding the next succeeding Interest Payment Date.
“Joint Powers Agreement” means the Joint Exercise of Powers Agreement for
the East Bay Regional Communications System Authority, dated as of September 11, 2007 by
and among the members thereto, including the Counties, as originally executed and as it may
from time to time be amended or supplemented pursuant to the provisions hereof and thereof.
“Moody’s” means Moody’s Investors Service a corporation duly organized and
existing under and by virtue of the laws of the State of Delaware, and its successors and assigns,
except that if such corporation shall be dissolved or liquidated or shall no longer perform the
functions of a securities rating agency, then the term “Moody’s” shall be deemed to refer to any
other nationally recognized securities rating agency selected by the County.
“Operating Agreements” means the Operating Agreements between the
Authority and the Users of the Project, executed from time to time. Copies of the current
Operating Agreements may be obtained from the Authority.
“Operating Payments” has the meaning ascribed thereto in the Operating
Agreements.
“Operation and Maintenance Fund” means the fund created by that name
pursuant to Section 5.02 hereof.
“Opinion of Counsel” means a written opinion of Bond Counsel.
“Outstanding,” when used as of any particular time with reference to Bonds,
means (subject to the provisions of Section 9.02) all Bonds except
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(1) Bonds theretofore canceled by the Trustee or surrendered to the Trustee
for cancellation;
(2) Bonds paid or deemed to have been paid within the meaning of
Section 10.01;
(3) Bonds deemed tendered but not yet presented for purchase; and
(4) Bonds in lieu of or in substitution for which other Bonds shall have been
executed, issued and delivered by the Authority pursuant hereto.
“Permitted Investments” means any of the following:
(1) Government Securities;
(2) direct obligations of the United States of America (including obligations
issued or held in book-entry form on the books of the Department of the Treasury) or obligations
the principal of and interest on which are unconditionally guaranteed by the United States of
America;
(3) bonds, debentures, notes or other evidence of indebtedness issued or
guaranteed by any of the following federal agencies and provided such obligations are backed by
the full faith and credit of the United States of America (stripped securities are only permitted if
they have been stripped by the agency itself): (a) Farmers Home Administration (FmHA)
certificates of beneficial ownership, (b) Federal Housing Administration (FHA) debentures,
(c) General Services Administration participation certificates, (d) Government National
Mortgage Association (GNMA or “Ginnie Mae”) guaranteed mortgage-backed bonds and
guaranteed pass-through obligations (participation certificates), (e) U.S. Maritime
Administration guaranteed Title XI financing, and (f) U.S. Department of Housing and Urban
Development (HUD) Project Notes and Local Authority Bonds;
(4) bonds, debentures, notes or other evidence of indebtedness issued or
guaranteed by any of the following non-full faith and credit U.S. government agencies (stripped
securities are only permitted if they have been stripped by the agency itself): (a) Federal Home
Loan Bank System senior debt obligations (consolidated debt obligations), (b) Federal Home
Loan Mortgage Corporation (FHLMC or “Freddie Mac”) participation certificates (mortgage-
backed securities) and senior debt obligations, (c) Federal National Mortgage Association
(FNMA or “Fannie Mae”) mortgage-backed securities and senior debt obligations (excluded are
stripped mortgage securities which are valued greater than par on the portion of unpaid
principal), (d) Resolution Funding Corp. (REFCORP) strips (interest component only) which
have been stripped by request to the Federal Reserve Bank of New York in book entry form, and
(e) Farm Credit System Consolidated systemwide bonds and notes;
(5) money market funds registered under the Federal Investment Company Act of
1940, the shares of which are registered under the Federal Securities Act of 1933, and which
have a rating by S&P of AAAm-G, AAAm, or AA-m and, if rated by Moody's, rated Aaa, Aal or
Aa2;
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(6) certificates of deposit secured at all times by collateral described in (2) and/or
(3) above (which collateral must be held by a third party and subject to a perfected first security
interest held by the Trustee) with a maturity of one year or less and issued by commercial banks,
savings and loan associations or mutual savings banks whose short term obligations are rated “A-
1+” or better by S&P and “Prime-l” by Moody's;
(7) certificates of deposit, savings accounts, deposit accounts or money market
deposits which are fully insured by FDIC, including BIF and SAIF;
(8) investment agreements, including guaranteed investment contracts;
(9) commercial paper rated “Prime-1” by Moody's and “A-1+” or better by S&P;
(10) bonds or notes issued by any state or municipality which is rated by Moody's
and S&P in one of the two highest long-term rating categories assigned by such agencies;
(11) federal funds or bankers acceptances with a maximum term of one year of
any bank which has an unsecured, uninsured and unguaranteed obligation rating of “Prime-1” or
“A3” or better by Moody's and “A-1+” or better by S&P;
(12) repurchase agreements that provide for the transfer of securities from a dealer
bank or securities firm (seller/borrower) to the Trustee (buyer/lender) and the transfer of cash
from the Trustee to the dealer bank or securities firm with an agreement that the dealer bank or
securities firm will repay the cash plus a yield to the Trustee in exchange for the securities at a
specified date and that satisfy the following criteria:
(a) repurchase agreements must be between the municipal entity and
dealer banks or securities firms that are (i) on the Federal Reserve reporting dealer list which fall
under the jurisdiction of the SIPC and which are rated A or better by S&P and Moody's, or
(ii) banks rated “A” or above by S&P and Moody's, and
(b) repurchase agreements must include the following: (i) securities that
are acceptable for transfer, including those describe in clauses (2) and (3) above, (ii) terms of not
more than 30 days, (iii) collateral must be delivered to the Trustee (if Trustee is not supplying the
collateral) or third party acting as agent for the Trustee (if the Trustee is supplying the collateral)
before or simultaneously with payment (perfection by possession of certificated securities),
(iv) the Trustee must have a perfected first priority security interest in the collateral, (v) collateral
must be free and clear of third-party liens and, in the case of an SIPC broker, must not have been
acquired pursuant to a repurchase agreement or reverse repurchase agreement, (vi) failure to
maintain the requisite collateral percentage, after a two day restoration period, requires the
Trustee to liquidate collateral, (vii) securities must be valued weekly and marked-to-market at
current market price plus accrued interest, and (viii) the value of-collateral must be equal to
104% or, if the securities used as collateral are FNMA or FHLMC securities, 105%, of the
amount of cash transferred to the dealer bank or security firm under the repurchase agreement
plus accrued interest and, if the value of securities held as collateral slips below such amount,
then additional cash and/or acceptable securities must be transferred;
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(13) pre-refunded municipal bonds rated “Aaa” by Moody's and “AAA” by S&P
or, if the there is no Moody's rating, then pre-refunded bonds pre-refunded with cash, direct U.S.
or U.S. guaranteed obligations, or AAA rated pre-refunded municipal obligations;
(14) money markets or mutual funds which are rated by S&P “AAAm-G” or
“AAAm” or higher and, if rated by Moody’s, are rated “Aaa” or higher, which funds may
include funds for which the Trustee, its affiliates or subsidiaries provide investment advisory or
other management services;
(15) the County of Alameda Investment Pool;
(16) the County of Contra Costa Investment Pool;
(17) the Local Agency Investment Fund of the State of California; and
(18) any other investment consented to by the Counties.
“Person” means a corporation, firm, association, partnership, trust, or other legal
entity or group of entities, including a governmental entity or any agency or political subdivision
thereof.
“Pledged Revenues” means all Service Payments paid by the Users and received
by the Authority pursuant to the Operating Agreements on and after July 1, 2013, and all interest
or other income from any investment, pursuant to Section 5.05, of any money in any fund or
account (other than the Rebate Fund) held by the Trustee and established pursuant to this Trust
Agreement.
“Principal Office” refers to the office of the Trustee noted in Section 11.10 and
such other offices as the Trustee may designate from time to time.
“Principal Payment Date” means any date on which principal of the Bonds is
required to be paid (whether by reason of maturity, redemption or acceleration). The scheduled
Principal Payment Dates for the Bonds will be June 1 or December 1 as specified therein.
“Project” means the 2011 Project and any additional facilities or improvements
financed with proceeds of Additional Bonds.
“Project Fund” means the fund by that name established pursuant to
Section 3.02 hereof.
“Qualified Institutional Buyer” has the meaning set forth in Rule 144A of the
Securities Act of 1933.
“Rating Category” means one of the general long-term (or short-term, if so
specifically provided) rating categories of either Moody’s and S&P, without regard to any
refinement or gradation of such rating category by a numerical modifier (unless a short-term
rating) or otherwise.
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“Record Date” means the close of business on the fifteenth (15th) calendar day
(whether or not a Business Day) of the month preceding any Interest Payment Date.
“Redemption Date” shall mean the date fixed for redemption of any Bonds.
“Redemption Price” means, with respect to any Bond (or portion thereof), the
principal amount of such Bond (or portion) plus the applicable premium, if any, payable upon
redemption thereof pursuant to the provisions of such Bond and this Trust Agreement.
“Reserve and Replacement Fund” means the fund by that name created
pursuant to Section 5.02 hereof.
“Reserve and Replacement Fund Requirement” as defined in the Project
Operating Agreement, namely that requirements for the Authority’s maintenance of a minimum
of $1,000,000 in the Reserve and Replacement Fund created by the Project Operating
Agreement, as set forth in Section 5.05.
“Responsible Officer” means any officer of the Trustee assigned to administer
its duties under this Trust Agreement.
“Revenue Fund” means the fund by that name created pursuant to Section 5.02
hereof.
“Revenues” means (i) the Initial Payments, (b) all User Payments received by the
Authority from the Users, including the proceeds of any business interruption insurance, and (c)
investment income with respect to any moneys held by the Trustee in the funds and accounts
established under the Trust Agreement and the Financing Agreements, and (d) all other funds
from any source legally available to the Authority.
“Serial Bonds” means Bonds for which no sinking fund payments are provided.
“Series” whenever used herein with respect to Bonds, means all of the Bonds
designated as being of the same series, authenticated and delivered in a simultaneous transaction,
regardless of variations in maturity, interest rate, redemption and other provisions, and any
Bonds thereafter authenticated and delivered upon transfer or exchange of or in lieu of or in
substitution for (but not to refund) such Bonds as herein provided.
“Series A Bonds” means the 2011 Series A Bonds.
“Series B Bonds” means the 2011 Series B Bonds.
“Series 2011 Bonds” means, collectively, the Series A Bonds and the Series B
Bonds issued pursuant to Section 2.01(b) hereof.
“Service Payments” means the annual payments by each User for the service
provided by the Project in the applicable Operating Period, in the amounts set forth in respective
Operating Agreements.
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“S&P” means Standard & Poor’s, a division of the McGraw-Hill Companies,
Inc., and its successors and assigns, except that if such entity shall be dissolved or liquidated or
shall no longer perform the functions of a securities rating agency, then the term S&P shall be
deemed to refer to any other nationally recognized securities rating agency selected by the
County.
“State” means the State of California.
“Supplemental Trust Agreement” means any trust agreement then in full force
and effect which has been duly executed and delivered by the Authority and the Trustee
amendatory hereof or supplemental hereto; but only if and to the extent that such Supplemental
Trust Agreement is executed and delivered pursuant to the provisions hereof.
“Tax Certificate” means the Tax Certificate and Agreement delivered by the
Authority and the respective County at the time of the issuance and delivery of a Series of
Bonds, as the same may be amended or supplemented in accordance with its terms.
“Term Bonds” means Bonds which are payable on or before their specified
maturity dates from sinking fund payments established for that purpose and calculated to retire
such Bonds on or before their specified maturity dates.
“Treasurer” means the treasurer of the Authority.
“Trust Agreement” means this Trust Agreement, dated as of October 1, 2010,
between the Authority and the Trustee, as originally executed and as it may from time to time be
amended or supplemented by all Supplemental Trust Agreements executed pursuant to the
provisions hereof.
“Trustee” means Deutsche Bank National Trust Company, or any other
association or corporation which may at any time be substituted as trustee hereunder as provided
in Section 8.01.
“2011 Project” means the portion of the Project financed with the proceeds of the
2011 Bonds as the same may be changed from time to time by the Authority by filing a
Certificate of the Authority with the Trustee and the Counties.
“Users” means users of the Project pursuant to the executed Operating
Agreements including the Counties.
“Variable Rate Bonds” means Bonds of any Series which bear interest at a
variable interest rate.
“Written Request of the Authority” means an instrument in writing signed by
or on behalf of the Authority by the Chair of its governing board or by its Executive Director or a
designee of such officer or by any other person (whether or not an officer of the Authority) who
is specifically authorized by resolution of the Board of Directors of the Authority to sign or
execute such a document on its behalf.
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SECTION 1.02 Equal Security. In consideration of the acceptance of the Bonds by
the Bondholders thereof, this Trust Agreement shall be deemed to be and shall constitute a
contract among the Authority, the Trustee and the Bondholders from time to time of all Bonds
authorized, executed, issued and delivered hereunder and then Outstanding to secure the full,
timely and final payment of the interest on and principal of and redemption premiums, if any, on
all Bonds which may from time to time be authorized, executed, issued and delivered hereunder,
subject to the agreements, conditions, covenants and provisions contained herein; and all
agreements and covenants set forth herein to be performed by or on behalf of the Authority shall
be for the equal and proportionate benefit, protection and security of all Bondholders of the
Bonds without distinction, preference or priority as to security or otherwise of any Bonds over
any other Bonds by reason of the number or date thereof or the time of authorization, sale,
execution, issuance or delivery thereof or for any cause whatsoever, except as expressly provided
herein or therein.
SECTION 1.03 Interpretation. Unless the context otherwise indicates, words
expressed in the singular shall include the plural and vice versa and the use of the neuter,
masculine, or feminine gender is for convenience only and shall be deemed to mean or include
the neuter, masculine or feminine gender, as appropriate. Headings of articles and sections
herein and the table of contents hereof are solely for convenience of reference, do not constitute
a part hereof and shall not affect the meaning, construction or effect hereof.
ARTICLE II
THE BONDS
SECTION 2.01 Authorization of Bonds; Series 2011 Bonds.
(a) Bonds may be issued hereunder from time to time in order to obtain
moneys to carry out the purposes of the Authority. The maximum principal amount of Bonds
which may be issued hereunder is not limited. The Bonds are designated generally as “East
Bay Regional Communications System Authority Revenue Bonds,” each Series thereof to bear
such additional designation as may be necessary or appropriate to distinguish such Series from
every other Series of Bonds. The Bonds may be issued in such Series as from time to time
shall be established and authorized by the Authority, subject to the covenants, provisions and
conditions herein contained.
(b) Two initial Series of Bonds are hereby created and designated “East Bay
Regional Communications System Authority Revenue Bonds, 2011 Series A” and “East Bay
Regional Communications System Authority Revenue Bonds, 2011 Series B.” The aggregate
principal amount of 2011 Series A Bonds which may be issued and Outstanding under this
Trust Agreement shall not exceed $3,681,751.81. The aggregate principal amount of 2011
Series B Bonds which may be issued and Outstanding under this Trust Agreement shall not
exceed $2,455,113.76.
(c) The Authority has reviewed all proceedings heretofore taken relative to
the authorization of the Bonds and has found, as a result of such review, and hereby finds and
determines that all acts, conditions and things required by law to exist, to have happened and to
OHS WEST:260976438.14
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have been performed precedent to and in the issuance of the Bonds do exist, have happened
and have been performed in due time, form and manner as required by law, and that the
Authority is now duly authorized, pursuant to each and every requirement of the Act, to issue
the Bonds in the form and manner provided herein for the purpose of providing funds to
finance the 2011 Project, and that the Bonds shall be entitled to the benefit, protection and
security of the provisions hereof.
(d) The validity of the issuance of the Bonds shall not be dependent on or
affected in any way by the proceedings taken by the Authority for the financing of the 2011
Project or by any contracts made by the Authority or its agents in connection therewith, and
shall not be dependent upon the performance by any person, firm or corporation of his or its
obligation with respect thereto. The recital contained in the Bonds that the same are issued
pursuant to the Act and pursuant hereto shall be conclusive evidence of their validity and of the
regularity of their issuance, and all Bonds shall be incontestable from and after their issuance.
The Bonds shall be deemed to be issued, within the meaning hereof, whenever the definitive
Bonds (or any temporary Bonds exchangeable therefor) shall have been delivered to the
purchaser thereof and the proceeds of sale thereof received.
SECTION 2.02 Terms of the Bonds.
(a) Payment of interest on the Bonds due on or before the maturity or prior
redemption thereof shall be paid by check mailed by first class mail on each Interest Payment
Date to the person in whose name the Bond is registered as of the applicable Record Date for
such Interest Payment Date at the address shown on the registration books maintained by the
Trustee pursuant to Section 2.07; provided, however, that interest on any Series of Bonds shall
be paid by wire transfer or other means to provide immediately available funds to any Owner
of at least $1,000,000 in aggregate principal amount of such Series of Bonds, at its option,
according to wire instructions given to the Trustee in writing for such purpose and on file as of
the applicable Record Date preceding the Interest Payment Date.
(b) Interest on any Bond shall cease to accrue (i) on the maturity date
thereof, provided that there has been irrevocably deposited with the Trustee an amount
sufficient to pay the principal amount thereof, plus interest accrued thereon to such date; or
(ii) on the redemption date thereof, provided there has been irrevocably deposited with the
Trustee an amount sufficient to pay the Redemption Price thereof, plus interest accrued thereon
to such date. The Owner of such Bond shall not be entitled to any other payment, and such
Bond shall no longer be Outstanding and entitled to the benefits of this Trust Agreement,
except for the payment of the principal amount or Redemption Price, of such Bond, as
appropriate, from moneys held by the Trustee for such payment.
(c) The principal of the Bonds shall be payable by check in lawful money of
the United States of America at the Principal Office of the Trustee, provided, however, that
principal on any Series of Bonds shall be paid by wire transfer or other means to provide
immediately available funds to any Owner of at least $1,000,000 in aggregate principal amount
of such Series of Bonds, at its option, according to wire instructions given to the Trustee in
writing for such purpose and on file as of the 15th day of the month preceding the Principal
Payment Date. No payment of principal shall be made on any Bond unless and until such
OHS WEST:260976438.14
14
Bond is surrendered to the Trustee for cancellation; provided that the Trustee may agree with
the Owner of any Bond or Bonds that such Owner may, in lieu of surrendering the same for a
new Bond, endorse on such Bond a record of partial payment of the principal of such Bond in
the form set forth below (which shall be typed or printed on such Bond):
PAYMENTS ON ACCOUNT OF PRINCIPAL
Payment Date
Principal
Amount Paid
Balance of Principal
Amount Unpaid
Signature of Owner
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
The Trustee shall maintain a record of each such partial payment made in
accordance with the foregoing agreement and such record shall be conclusive. Such partial
payment shall be valid upon payment of the amount thereof to the Owner of such Bond, and the
Authority and the Trustee shall be fully released and discharged from all liability to the extent of
such payment irrespective of whether such endorsement shall or shall not have been made upon
such Bond by the Owner thereof and irrespective of any error or omission in such endorsement.
(d) The Trustee shall identify all payments (whether made by check or by
wire transfer) of interest, principal, and premium by the registration number of the related
Bond.
SECTION 2.03 Terms of the Series 2011 Bonds.
(a) The Series A Bonds shall be issued as Convertible Capital Appreciation
Bonds in the principal amount of $3,681,751.81 with a conversion date of June 1, 2013. The
Series A shall mature in the year and in the principal amount and bear interest at the rate as set
forth in the following schedule, subject to prior redemption as described in Article IV hereof:
East Bay Regional Communications System Authority
Revenue Bonds,
2011 Series A
Maturity Date
(June 1) Principal Amount
Accreted
Value at
Conversion
Date
(June 1, 2013) Interest Rate
2027* $3,681,751.81 $4,007,000 4.05%
_______________
*Term Bond
OHS WEST:260976438.14
15
The Series A Bonds shall bear interest at the rates set forth above compounding
on June 1 and December 1 of each year until and including June, 2013 and thereafter accruing
current interest, payable commencing December 1, 2013 and semiannually thereafter on June 1
and December 1 in each year. The Series A Bonds shall pay interest from the Interest Payment
Date next preceding the date of authentication thereof, unless such date of authentication is after
the Record Date for an Interest Payment Date, in which event they shall pay interest from such
Interest Payment Date, or unless such date of authentication is on or prior to the Record Date for
the first Interest Payment Date, in which event they shall pay interest from the Conversion Date.
The amount of interest so payable on any Interest Payment Date shall be computed on the basis
of a 360-day year consisting of twelve 30-day months.
(b) The Series B Bonds shall be issued as Serial and Term Bonds in the
principal amount of $2,455,113.76. The Series B Bonds shall mature in the year and in the
principal amount and bear interest at the rate as set forth in the following schedule, subject to
prior redemption as described in Article IV hereof:
East Bay Regional Communications System Authority
Revenue Bonds,
2011 Series B
Maturity Date
(June 1) Principal Amount
Accreted
Value at
Conversion
Date
(June 1, 2013) Interest Rate
2027* $2,455,113.76 $2,672,000 4.05%
_______________
*Term Bond
The Series B Bonds shall bear interest at the rates set forth above compounding
on June 1 and December 1 of each year until and including June, 2013 and thereafter accruing
current interest, payable commencing December 1, 2013 and semiannually thereafter on June 1
and December 1 in each year. The Series B Bonds shall pay interest from the Interest Payment
Date next preceding the date of authentication thereof, unless such date of authentication is after
the Record Date for an Interest Payment Date, in which event they shall pay interest from such
Interest Payment Date, or unless such date of authentication is on or prior to the Record Date for
the first Interest Payment Date, in which event they shall pay interest from their dated date. The
amount of interest so payable on any Interest Payment Date shall be computed on the basis of a
360-day year consisting of twelve 30-day months.
(c) The Series 2011 Bonds shall be dated the date of issuance thereof, shall
be issued only in fully registered form in Authorized Denominations (not exceeding the
principal amount of Series 2011 Bonds maturing at any one time). The Series 2011 Bonds
initially shall be issued in the form of a single authenticated fully registered bond for each
maturity and series of such Bonds, in the principal amount of the Bonds of such maturity and
OHS WEST:260976438.14
16
series. Upon initial issuance, the ownership of all such Bonds shall be registered as specified
by the purchaser thereof in the registration records maintained by the Trustee pursuant to
Section 2.07. Payment of interest on the Series 2011 Bonds due on or before the maturity or
prior redemption thereof shall be paid by check mailed by first class mail on each Interest
Payment Date to the person in whose name the Bond is registered as of the applicable Record
Date for such Interest Payment Date at the address shown on the registration books maintained
by the Trustee pursuant to Section 2.07; provided, however, that interest on any Series of
Bonds shall be paid by wire transfer or other means to provide immediately available funds to
any Owner of at least $1,000,000 in aggregate principal amount of such Series of Bonds, at its
option, according to wire instructions given to the Trustee in writing for such purpose and on
file as of the applicable Record Date preceding the Interest Payment Date.
(d) Interest on any Bond shall cease to accrue (i) on the maturity date
thereof, provided that there has been irrevocably deposited with the Trustee an amount
sufficient to pay the principal amount thereof, plus interest accrued thereon to such date; or
(ii) on the redemption date thereof, provided there has been irrevocably deposited with the
Trustee an amount sufficient to pay the Redemption Price thereof, plus interest accrued thereon
to such date. The Owner of such Bond shall not be entitled to any other payment, and such
Bond shall no longer be Outstanding and entitled to the benefits of this Trust Agreement,
except for the payment of the principal amount or Redemption Price, of such Bond, as
appropriate, from moneys held by the Trustee for such payment.
(e) The principal of the Bonds shall be payable by check in lawful money of
the United States of America at the Principal Office of the Trustee, provided, however, that
principal on any Series of Bonds shall be paid by wire transfer or other means to provide
immediately available funds to any Owner of at least $1,000,000 in aggregate principal amount
of such Series of Bonds, at its option, according to wire instructions given to the Trustee in
writing for such purpose and on file as of the 15th day of the month preceding the Principal
Payment Date. No payment of principal shall be made on any Bond unless and until such
Bond is surrendered to the Trustee for cancellation; provided that the Trustee may agree with
the Owner of any Bond or Bonds that such Owner may, in lieu of surrendering the same for a
new Bond, endorse on such Bond a record of partial payment of the principal of such Bond in
the form set forth below (which shall be typed or printed on such Bond):
PAYMENTS ON ACCOUNT OF PRINCIPAL
Payment Date
Principal
Amount Paid
Balance of Principal
Amount Unpaid
Signature of Owner
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
___________ ___________ ___________ ___________
The Trustee shall maintain a record of each such partial payment made in
accordance with the foregoing agreement and such record shall be conclusive. Such partial
OHS WEST:260976438.14
17
payment shall be valid upon payment of the amount thereof to the Owner of such Bond, and the
Authority and the Trustee shall be fully released and discharged from all liability to the extent of
such payment irrespective of whether such endorsement shall or shall not have been made upon
such Bond by the Owner thereof and irrespective of any error or omission in such endorsement.
(f) The Trustee shall identify all payments (whether made by check or by
wire transfer) of interest, principal, and premium by the registration number of the related
Bond.
SECTION 2.04 Form of Bond. The Bonds and the authentication and registration
endorsement and assignment to appear thereon shall be substantially in the form set forth in
Exhibit A attached hereto and by this reference herein incorporated.
SECTION 2.05 Execution of Bonds. The Chair or the Executive Director of the
Authority is hereby authorized and directed to execute each of the Bonds on behalf of the
Authority and the Secretary of the Authority is hereby authorized and directed to countersign
each of the Bonds on behalf of the Authority. The signatures of such officers may be by printed,
lithographed or engraved by facsimile reproduction. In case any officer whose signature appears
on the Bonds shall cease to be such officer before the delivery of the Bonds to the purchaser
thereof, such signature shall nevertheless be valid and sufficient for all purposes as if such officer
had remained in office until such delivery of the Bonds.
Only those Bonds bearing thereon a certificate of authentication in the form
hereinbefore recited, executed manually and dated by the Trustee, shall be entitled to any benefit,
protection or security hereunder or be valid or obligatory for any purpose, and such certificate of
the Trustee shall be conclusive evidence that the Series 2011 Bonds so authenticated have been
duly authorized, executed, issued and delivered hereunder and are entitled to the benefit,
protection and security hereof.
SECTION 2.06 Transfer and Payment of Bonds. (a) Any Bond may, in
accordance with its terms, be transferred in the books required to be kept pursuant to the
provisions of Section 2.07 by the person in whose name it is registered, in person or by his duly
authorized attorney, upon surrender of such Bond for cancellation accompanied by delivery of a
duly executed written instrument of transfer in a form acceptable to the Trustee. Whenever any
Bond or Bonds shall be surrendered for transfer, the Authority shall execute and the Trustee shall
authenticate and deliver to the transferee a new Bond or Bonds of the same Series and maturity
for a like aggregate principal amount of Authorized Denominations. The Trustee shall require
the payment by the Bondholder requesting such transfer of any tax or other governmental charge
required to be paid with respect to such transfer as a condition precedent to the exercise of such
privilege.
The Authority and the Trustee may, except as otherwise provided herein, deem
and treat the registered owner of any Bond as the absolute owner of such Bond for the purpose of
receiving payment thereof and for all other purposes, whether such Bond shall be overdue or not,
and neither the Authority nor the Trustee shall be affected by any notice or knowledge to the
contrary; and payment of the interest on and principal of and redemption premium, if any, on
OHS WEST:260976438.14
18
such Bond shall be made only to such registered owner, which payments shall be valid and
effectual to satisfy and discharge liability on such Bond to the extent of the sum or sums so paid.
The Trustee shall not be required to register the transfer of or exchange any Bonds
which has been selected for redemption in whole or in part, from and after the day of mailing of
a notice of redemption of such Bond selected for redemption in whole or in part as provided in
Section 4.04 or during the period established by the Trustee for selection of Bonds for
redemption.
The Owner shall not sell any participation interests in the Series 2011 Bonds, but
shall only sell and transfer the entire outstanding principal amount of the Series 2011 Bonds
upon the consent of the Authority.
SECTION 2.07 Exchange of Bonds. Bonds may be exchanged at the Principal
Office of the Trustee for a like aggregate principal amount of Bonds of the same Series and
maturity of other authorized denominations. The Trustee shall require the payment by the
Bondholder requesting such exchange of any tax or other governmental charge required to be
paid with respect to such exchange as a condition precedent to the exercise of such privilege.
The Trustee shall not be required to exchange any Bond which has been selected for redemption
in whole or in part, from and after the day of mailing of a notice of redemption of such Bond
selected for redemption in whole or in part as provided in Section 4.04 or during the period
established by the Trustee for selection of Bonds for redemption.
SECTION 2.08 Bond Registration Books. The Trustee will keep at its office
sufficient books for the registration and transfer of the Bonds, which during normal business
hours shall be open to inspection by the Authority, and upon presentation for such purpose the
Trustee shall, under such reasonable regulations as it may prescribe, register or transfer the
Bonds in such books as hereinabove provided.
SECTION 2.09 Mutilated, Destroyed, Stolen or Lost Bonds; Temporary Bonds. If
any Bond shall become mutilated, the Trustee, at the expense of the Bondholder, shall thereupon
authenticate and deliver a new Bond of like tenor and amount in exchange and substitution for
the Bond so mutilated, but only upon surrender to the Trustee of the Bond so mutilated. Every
mutilated Bond so surrendered to the Trustee shall be Canceled .
If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or
theft may be submitted to the Trustee and, if such evidence be satisfactory to the Trustee and
indemnity satisfactory to the Trustee shall be given, the Trustee, at the expense of the
Bondholder, shall thereupon authenticate and deliver a new Bond of like tenor in lieu of and in
substitution for the Bond so lost, destroyed or stolen.
The Trustee may require payment of a reasonable sum for each new Bond issued
under this Section 2.08 and of the expenses which may be incurred by the Authority and the
Trustee in the premises. Any Bond issued under the provisions of this Section in lieu of any
Bond alleged to be lost, destroyed or stolen shall be equally and proportionately entitled to the
benefits of this Trust Agreement with all other Bonds of the same Series secured by this Trust
Agreement. Neither the Authority nor the Trustee shall be required to treat both the original
OHS WEST:260976438.14
19
Bond and any replacement Bond as being Outstanding for the purpose of determining the
principal amount of Bonds which may be issued hereunder or for the purpose of determining any
percentage of Bonds Outstanding hereunder, but both the original and replacement Bond shall be
treated as one and the same.
The Bonds issued under this Trust Agreement may be initially issued in
temporary form exchangeable for definitive Bonds when ready for delivery. The temporary
Bonds may be printed, lithographed or typewritten, shall be of such denominations as may be
determined by the Authority, shall be in fully registered form and may contain such reference to
any of the provisions of this Trust Agreement as may be appropriate. Every temporary Bond
shall be executed and authenticated as authorized by the Authority, in accordance with the terms
of the Act. If the Authority issues temporary Bonds it will execute and furnish definitive Bonds
without delay and thereupon the temporary Bonds may be surrendered, for cancellation, in
exchange therefor at the Principal Office of the Trustee, and the Trustee shall deliver in exchange
for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized
denominations. Until so exchanged, the temporary Bonds shall be entitled to the same benefits
under this Trust Agreement as definitive Bonds delivered hereunder.
ARTICLE III
ISSUANCE OF BONDS
SECTION 3.01 Procedure for the Issuance of Bonds. The Authority shall execute
the Series 2011 Bonds for issuance hereunder and shall deliver them to the Trustee, and
thereupon the Bonds shall be authenticated and delivered by the Trustee to the County purchaser
thereof upon the Written Request of the Authority and upon receipt of payment therefor the
Trustee shall deposit such proceeds to the following funds held by the Trustee pursuant hereto:
(a) To the Costs of Issuance Fund, an amount equal to $136,865.57; and
(b) To the Project Fund, the remaining proceeds from the sale of the Bonds,
or an amount equal to $6,000,000.
SECTION 3.02 Project Fund. The Trustee hereby agrees to establish and maintain
hereunder so long as proceeds remain therein the Project Fund. In addition to deposit made
pursuant to Section 3.01, the Authority shall deposit prepayments of Service Payments made on
or prior to the sizing of the Series 2011 Bonds into the Project Fund. The moneys in the Project
Fund shall be disbursed upon the Written Request of the Authority in substantially the form
attached hereto as Exhibit B, for the payment of costs relating to the financing and completion of
the Project. Upon completion of the Project, the Authority may upon its Written Request cause
the Project Fund to be closed and any remaining funds to be transferred to the Reserve and
Replacement Fund or as otherwise directed in the Written Request of the Authority.
SECTION 3.03 Conditions for the Issuance of Additional Bonds. The Authority
may at any time issue Additional Bonds pursuant to a Supplemental Trust Agreement, payable
from the Pledged Revenues as provided herein and secured by a pledge of and charge and lien
upon the Pledged Revenues as provided herein equal to the pledge, charge and lien securing the
OHS WEST:260976438.14
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Outstanding Bonds theretofore issued hereunder, but only subject to the following specific
conditions, which are hereby made conditions precedent to the issuance of any such Additional
Bonds:
(a) The Authority shall be in compliance with all agreements and covenants
contained herein.
(b) The Supplemental Trust Agreement shall require that the proceeds of the
sale of such Additional Bonds shall be applied to the acquisition (by purchase or lease) or
construction of the Project or for the refunding of Outstanding Bonds.
(c) The aggregate principal amount of Bonds issued and at any time
Outstanding hereunder shall not exceed any limit imposed by law, by this Trust Agreement or
by any Supplemental Trust Agreement.
(d) With respect to issuances other than the Series 2011 Bonds, if the Bonds
are outstanding, the consent of the Owners thereof.
SECTION 3.04 Proceedings for Authorization of Additional Bonds. Whenever the
Authority shall determine to execute and deliver any Additional Bonds pursuant to Section 3.03,
the Authority and the Trustee shall enter into a Supplemental Trust Agreement providing for the
issuance of such Additional Bonds, specifying the maximum principal amount of such
Additional Bonds and prescribing the terms and conditions of such Additional Bonds.
The Supplemental Trust Agreement shall prescribe the form or forms of such
Additional Bonds and, subject to the provisions of Section 3.03, shall provide for the distinctive
designation, denominations, method of numbering, dates, payment dates, interest rates (or
method of determining the rates, if variable), interest payment dates, provisions for redemption
(if desired) and places of payment of principal and interest.
Before such Additional Bonds shall be issued, the Authority shall file or cause to
be filed the following documents with the Trustee and the Counties:
(a) An Opinion of Counsel setting forth that (1) such Counsel has examined
the Supplemental Trust Agreement; and (2) the execution and delivery of the Additional Bonds
have been sufficiently and duly authorized by the Authority and the respective Counties where
the Project is located.
(b) A Certificate of the Authority stating that the requirements of
Section 3.03 have been met.
Upon the delivery to the Trustee of the foregoing instruments and upon the
Trustee’s receipt of Certificate of the Authority stating that all applicable provisions of this Trust
Agreement have been complied with (so as to permit the issuance of the Additional Bonds in
accordance with the Supplemental Trust Agreement then delivered to the Trustee), the Trustee
shall authenticate and deliver said Additional Bonds in the aggregate principal amount specified
in such Supplemental Trust Agreement to, or upon the Written Request of, the Authority.
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SECTION 3.05 Limitations on the Issuance of Obligations Payable from Pledged
Revenues. The Authority will not, so long as any of the Bonds are Outstanding, issue any
obligations or securities, however denominated, payable in whole or in part from Pledged
Revenues except the following:
(a) Bonds of any Series authorized pursuant to Section 3.04;
(b) Obligations which are junior and subordinate to the payment of the
principal, premium and interest requirements for the Bonds and which subordinated obligations
are payable as to principal, premium and interest, if any, only out of Pledged Revenues after
the prior payment of all amounts then required to be paid hereunder from Pledged Revenues
for principal, premium and interest for the Bonds, as the same become due and payable and at
the times and in the manner as required in this Trust Agreement.
ARTICLE IV
REDEMPTION OF BONDS
SECTION 4.01 Extraordinary Redemption. The Bonds are not subject to
extraordinary redemption.
SECTION 4.02 Optional Redemption. The Bonds are subject to optional
redemption prior to their maturity at the written direction of the Authority, from any moneys
deposited by the Authority, as a whole or in part on any date at the principal amount or Accreted
Value of Bonds called for redemption, together with accrued interest to the date fixed for
redemption, without premium.
SECTION 4.03 Mandatory Sinking Fund Redemption. The Series 2011 Term
Bonds, upon notice as hereinafter provided, shall also be subject to mandatory sinking fund
redemption prior to maturity, in part on June 1 of each year on the Mandatory Sinking Account
Payment Dates specified in Section 5.03, by lot, from and in the amount of the mandatory
sinking account payments set forth in Section 5.03 at a redemption price equal to the sum of the
principal amount thereof plus accrued interest thereon to the redemption date, without premium.
SECTION 4.04 Selection of Bonds for Redemption. The Authority shall designate
which maturities of Bonds are to be redeemed. If less than all Outstanding Bonds of the same
Series maturing by their terms on any one date are to be redeemed at any one time, the Trustee
shall select the Bonds of such maturity date to be redeemed by lot and shall promptly notify the
Authority in writing of the numbers of the Bonds so selected for redemption. For purposes of
such selection, Bonds shall be deemed to be composed of multiples of minimum Authorized
Denominations and any such multiple may be separately redeemed. In the event Term Bonds are
designated for redemption, the Authority may designate which sinking account payments are
allocated to such redemption.
SECTION 4.05 Notice of Redemption; Cancellation; Effect of Redemption.
Unless waived by the Owners thereof, notice of redemption shall be mailed by first-class mail by
the Trustee, not less than thirty (30) nor more than sixty (60) days prior to the redemption date to
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the respective Bondholders of the Bonds designated for redemption at their addresses appearing
on the registration books of the Trustee. Each notice of redemption shall state the date of such
notice, the date of issue of the Bonds, the Series, the redemption date, the Redemption Price, the
place or places of redemption (including the name and appropriate address of the Trustee), and,
if less than all of any such maturity is to be redeemed, the distinctive certificate numbers of the
Bonds of such maturity, to be redeemed and, in the case of Bonds to be redeemed in part only,
the respective portions of the principal amount thereof to be redeemed. Each such notice shall
also state that on said date there will become due and payable on each of said Bonds the
redemption price thereof, together with interest accrued thereon to the redemption date, and that
from and after such redemption date interest thereon shall cease to accrue, and shall require that
such Bonds be then surrendered at the address of the Trustee specified in the redemption notice.
Failure to receive such notice shall not invalidate any of the proceedings taken in connection
with such redemption.
The Trustee may give a conditional notice of redemption prior to the receipt of all
funds or satisfaction of all conditions necessary to effect the redemption, provided that
redemption shall not occur unless and until all conditions have been satisfied and the Trustee has
on deposit and available or, if applicable, has received, all of the funds necessary to effect the
redemption; otherwise, such redemption shall be Canceled by the Trustee and the Trustee shall
mail notice of such cancellation to the recipients of the notice of redemption being Canceled .
The Authority may, at its option, on or prior to the date fixed for redemption in
any notice of redemption rescind and cancel such notice of redemption by Written Request to the
Trustee and the Trustee shall mail notice of such cancellation to the recipients of the notice of
redemption being canceled.
If notice of redemption has been duly given as aforesaid and money for the
payment of the redemption price of the Bonds called for redemption is held by the Trustee, then
on the redemption date designated in such notice Bonds so called for redemption shall become
due and payable, and from and after the date so designated interest on such Bonds shall cease to
accrue, and the Bondholders of such Bonds shall have no rights in respect thereof except to
receive payment of the redemption price thereof.
All Bonds redeemed pursuant to the provisions of this Article shall be canceled
by the Trustee and shall be destroyed with a certificate of destruction furnished to the Authority
upon its request and shall not be reissued.
ARTICLE V
REVENUES
SECTION 5.01 Pledge of Pledged Revenues.
All Pledged Revenues and any other amounts held by the Trustee in any fund or
account established hereunder (other than amounts on deposit in the Rebate Fund created
pursuant to Section 6.03) are hereby irrevocably pledged and assigned to the payment of the
interest and premium, if any, on and principal of the Bonds as provided herein, and the Pledged
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Revenues and other amounts pledged hereunder shall not be used for any other purpose while
any of the Bonds remain Outstanding; provided, however, that out of the Pledged Revenues and
other moneys there may be applied such sums for such purposes as are permitted hereunder.
This pledge shall constitute a pledge of and charge and first lien upon the Pledged Revenues, all
other amounts pledged hereunder and all other moneys on deposit in the funds and accounts
established with the Trustee hereunder (excluding amounts on deposit in the Rebate Fund created
pursuant to Section 6.03) for the payment of the interest on and principal of the Bonds in
accordance with the terms hereof and thereof.
SECTION 5.02 Receipt and Deposit of Revenues in the Revenue Fund. In order
to carry out and effectuate the pledge, assignment, charge and lien contained herein, the
Authority agrees and covenants to create the following funds:
(a) The Revenue Fund, and, within the Revenue Fund,
(i) The Bond Fund (the “Bond Fund”), to be held in trust by the
Trustee for the benefit of the Bondholders;
(ii) The Operation and Maintenance Fund (the “Operation and
Maintenance Fund”;
(iii) The Reserve and Replacement Fund (the “Reserve and
Replacement Fund”);
(iv) and, within such fund, a Service Prepayment Account.
(b) All Revenues and all other amounts pledged hereunder when and as
received shall be received by the Authority in the Revenue Fund (the “Revenue Fund”).
Service Payments made on or after June 1, 2013 shall be transferred when and as received by
the Authority to the Trustee for deposit in the Bond Fund (the “Bond Fund”), which fund is
hereby created and which fund the Trustee hereby agrees and covenants to maintain in trust for
Bondholders so long as any Bonds shall be Outstanding hereunder. All Revenues and all other
amounts pledged and assigned hereunder shall be accounted for through the Revenue Fund,
and the Trustee shall have no beneficial right or interest in any of the Revenues except only as
herein provided. When the Authority receives any Operating Payments, it shall hold the same
in the Operation and Maintenance Fund within the Revenue Fund. When the Authority
receives any Initial Payments, it shall hold the same in the Reserve and Replacement Fund
within the Revenue Fund. All Revenues and all other amounts pledged and assigned hereunder,
whether received by the Authority or deposited with the Trustee as herein provided, shall
nevertheless be allocated, applied and disbursed solely to the purposes and uses hereinafter in
this Article set forth, and shall be accounted for separately and apart from all other accounts,
funds, money or other resources of the Trustee.
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SECTION 5.03 Establishment and Maintenance of Accounts for Use of Money in
the Bond Fund.
(a) Bond Fund. Subject to Section 6.03, all money in the Bond Fund shall
be set aside by the Trustee in the following respective special accounts or funds within the
Bond Fund (each of which is hereby created and each of which the Trustee hereby covenants
and agrees to cause to be maintained) in the following order of priority:
(1) Interest Account, and
(2) Principal Account.
All money in each of such accounts shall be held in trust by the Trustee and shall be applied,
used and withdrawn only for the purposes hereinafter authorized in this Section. On each June 1,
following payment of principal of and interest on the Bonds due on such date, any excess amount
on deposit in the Bond Fund shall be returned to the Authority for deposit in the Reserve and
Replacement Fund.
(b) Interest Account. On or before each Interest Payment Date following
the Conversion Date for such Bonds, the Trustee shall set aside from the Bond Fund and
deposit in the Interest Account that amount of money which is equal to the amount of interest
becoming due and payable on all Outstanding Bonds on such Interest Payment Date.
No deposit need be made in the Interest Account if the amount contained therein
and available to pay interest on the Bonds is at least equal to the aggregate amount of interest
becoming due and payable on all Outstanding Bonds on such Interest Payment Date.
All money in the Interest Account shall be used and withdrawn by the Trustee
solely for the purpose of paying the interest on the Bonds as it shall become due and payable
(including accrued interest on any Bonds purchased or redeemed prior to maturity).
(c) Principal Account. On or before each June 1 commencing June 1, 2014,
the Trustee shall set aside from the Bond Fund and deposit in the Principal Account an amount
of money equal to the amount of all sinking fund payments required to be made on such June 1
or December 1 into the respective sinking fund accounts for all Outstanding Term Bonds and
the principal amount of all Outstanding Serial Bonds maturing on such June 1 or December 1.
No deposit need be made in the Principal Account if the amount contained therein
and available to pay principal of the Bonds is at least equal to the aggregate amount of the
principal of all Outstanding Serial Bonds maturing by their terms on such June 1 or December 1
plus the aggregate amount of all sinking fund payments required to be made on such June 1 or
December 1 for all Outstanding Term Bonds.
The Trustee shall establish and maintain within the Principal Account a separate
subaccount for the Term Bonds of each Series and maturity, designated as the “____ Sinking
Account” (the “Sinking Account”), inserting therein the Series and maturity (if more than one
such account is established for such Series) designation of such Bonds. With respect to each
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Sinking Account, on each mandatory sinking account payment date established for such Sinking
Account, the Trustee shall apply the mandatory sinking account payment required on that date to
the redemption (or payment at maturity, as the case may be) of Term Bonds of the Series and
maturity for which such Sinking Account was established, upon the notice and in the manner
provided in Article IV.
The Trustee shall establish and maintain within the Principal Account a Sinking
Account for the Series 2011 Term Bonds maturing on June 1, 2027. Subject to the terms and
conditions set forth in this Section and Section 4.03, the Term Bonds maturing on June 1, 2027
shall be redeemed (or paid at maturity, as the case may be) by application of mandatory sinking
account payments in the amounts and upon the dates as follows:
Term Bonds Sinking Account
Mandatory Sinking Account
Payment Date (June 1)
Mandatory Sinking
Account Payments
Series A Bonds Series B Bonds
2014 $119,447.90 $79,938.21
2015 213,168.56 142,418.65
2016 222,356.86 147,931.63
2017 231,545.16 154,363.44
2018 240,733.46 160,795.25
2019 249,921.76 167,227.06
2020 260,947.72 173,658.87
2021 271,054.85 181,009.51
2022 282,080.81 188,360.15
2023 293,106.77 195,710.79
2024 305,051.56 203,061.43
2025 317,915.18 211,330.90
2026 330,778.80 220,519.20
2027* 343,642.42 228,788.67
__________________
*Maturity
If the Series 2011 Term Bonds are optionally redeemed in part, the Authority may
designate the Mandatory Sinking Account Payments to be allocated to such optional redemption.
All money in the Principal Account shall be used and withdrawn by the Trustee
solely for the purpose of paying the principal of the Bonds as it shall become due and payable,
whether at maturity or redemption, except that any money in any Sinking Account shall be used
and withdrawn by the Trustee only to redeem or to pay Term Bonds for which such Sinking
Account was created.
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SECTION 5.04 Reserve and Replacement Fund. (a) The Authority shall maintain
and hold a separate fund to be known as the “Reserve and Replacement Fund.” The Authority
shall deposit Initial Payments in the Reserve and Replacement Fund. The Authority may
withdraw amounts from the Reserve and Replacement Fund for use in repairing, improving or
replacing the Project or any component thereof; providing credits to Users pursuant to Exhibit A
of the Operating agreement, or for any other lawful purpose that is authorized by the Authority’s
Board of Directors; provided, however, that in the event any Service Payment is abated as
provided herein or is insufficient to pay Debt Service, amounts on deposit in the Reserve and
Replacement Fund may be used for transfer to the Bond Fund in an amount equal to such abated
Service Payments or such insufficiency until such time as the abatement is discontinued and
Pledged Revenues are sufficient to pay Debt Service.
(b) The Authority shall transfer all Service Payments made after sizing of
the Series 2011 Bonds and on or before June 30, 2013 to the Service Prepayment Account
within the Reserve and Replacement Account for use as set forth in Subsection (a) of this
Section 5.04. Amounts on deposit in the Service Prepayment Account maybe used for
acquisition, construction and improvement of the Project.
SECTION 5.05 Operation and Maintenance Fund. The Authority shall maintain
and the Treasurer shall hold a separate fund to be known as the “Operation and Maintenance
Fund.” The Authority shall deposit Operation and Maintenance Payments in the Operation and
Maintenance Fund. The Authority may withdraw amounts from the Operation and Maintenance
Fund for use in operating or maintaining the Project or any component thereof, or for any other
lawful purpose that is authorized by the Authority’s Board of Directors. At the end of each fiscal
year, the Authority shall transfer any moneys remaining in the Operation and Maintenance Fund
to the Reserve and Replacement Fund.
SECTION 5.06 Application of Insurance Proceeds. In the event of any damage to
or destruction of any part of the Project covered by insurance, the Authority shall cause the
proceeds of such insurance to be utilized for the repair, reconstruction or replacement of the
damaged or destroyed portion of the Project, and the Trustee shall hold said proceeds in a fund
established by the Trustee for such purpose separate and apart from all other funds designated
the “Insurance and Condemnation Fund,” to the end that such proceeds shall be applied to the
repair, reconstruction or replacement of the Project to at least the same good order, repair and
condition as it was in prior to the damage or destruction, insofar as the same may be
accomplished by the use of said proceeds. In the event that the Project is not replaced or
repaired, any insurance proceeds received by the Authority shall be used to pay principal of and
interest on the Bonds.
SECTION 5.07 Deposit and Investments of Money in Accounts and Funds.
Subject to Section 6.03, all money held by the Trustee in any of the accounts or funds established
pursuant hereto shall be invested in Permitted Investments at the Written Request of the
Authority or, if no instructions are received, in money market funds described in clause (5) of the
definition or the County Pool described in clause (15) of Permitted Investments. Such
investments shall, as nearly as practicable, mature on or before the dates on which such money is
anticipated to be needed for disbursement hereunder. For purposes of this restriction, Permitted
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Investments containing a repurchase option or put option by the investor shall be treated as
having a maturity of no longer than such option. Unless otherwise instructed by the Authority,
all interest or profits received on any money so invested in the Project Fund shall be deposited in
the Project Fund until completion of the related Project and shall thereafter be deposited in the
Bond Fund. The Trustee and its affiliates may act as principal, agent, sponsor or advisor with
respect to any investments. The Trustee shall not be liable for any losses on investments made in
accordance with the terms and provisions of this Trust Agreement.
Investments purchased with funds on deposit in the Bond Fund shall mature not
later than the payment date or redemption date, as appropriate, immediately succeeding the
investment.
Subject to Section 6.03, investments in any and all funds and accounts except for
the Rebate Fund may be commingled for purposes of making, holding and disposing of
investments, notwithstanding provisions herein for transfer to or holding in particular funds and
accounts amounts received or held by the Trustee hereunder, provided that the Trustee shall at all
times account for such investments strictly in accordance with the funds and accounts to which
they are credited and otherwise as provided in this Trust Agreement.
ARTICLE VI
COVENANTS OF THE AUTHORITY
SECTION 6.01 Punctual Payment and Performance. The Authority will
punctually pay out of the Pledged Revenues the interest on and principal of and redemption
premiums, if any, to become due on every Bond issued hereunder in strict conformity with the
terms hereof and of the Bonds, and will faithfully observe and perform all the agreements and
covenants to be observed or performed by the Authority contained herein and in the Bonds.
SECTION 6.02 Against Encumbrances. The Authority will not make any pledge
or assignment of or place any charge or lien upon the Pledged Revenues except as provided in
Section 5.01, and will not issue any bonds, notes or obligations payable from the Pledged
Revenues or secured by a pledge of or charge or lien upon the Pledged Revenues except as
provided in Section 3.04.
SECTION 6.03 Tax Covenants; Rebate Fund.
(a) In addition to the accounts created pursuant to Section 5.03, the Trustee
shall establish and maintain a fund separate from any other fund or account established and
maintained hereunder designated as the Rebate Fund. There shall be deposited in the Rebate
Fund such amounts as are required to be deposited therein pursuant to the Tax Certificate. All
money at any time deposited in the Rebate Fund shall be held by the Trustee in trust, to the
extent required to satisfy the Rebate Requirement (as defined in the Tax Certificate), for
payment to the United States of America. Notwithstanding the provisions of Sections 5.01,
5.02, 5.05, 9.01 and 10.01 relating to the pledge of Pledged Revenues, the allocation of money
in the Bond Fund, the investments of money in any fund or account, the application of funds
upon acceleration and the defeasance of Outstanding Bonds, all amounts required to be
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deposited into or on deposit in the Rebate Fund shall be governed exclusively by this Section
6.03 and by the Tax Certificate (which is incorporated herein by reference). The Trustee shall
be deemed conclusively to have complied with such provisions if it follows the written
directions of the Authority, and shall have no liability or responsibility to enforce compliance
by the Authority with the terms of the Tax Certificate.
(b) Any funds remaining in the Rebate Fund with respect to a Series of
Bonds after redemption and payment of all such Series of Bonds and all other amounts due
hereunder or under the Financing Agreement relating to such Series of Bonds, or provision
made therefor satisfactory to the Trustee, including accrued interest and payment of any
applicable fees and expenses of the Trustee and satisfaction of the Rebate Requirement (as
defined in the Tax Certificate), shall be withdrawn by the Trustee and remitted to or upon the
Written Request of the Authority.
(c) The Authority shall not use or permit the use of any proceeds of the
Bonds or any funds of the Authority, directly or indirectly, in any manner, and shall not take or
omit to take any action that would cause any of the Bonds to be treated as an obligation not
described in Section 103(a) of the Code. In the event that at any time the Authority is of the
opinion that for purposes of this Section 6.03(c) it is necessary to restrict or to limit the yield
on the investment of any moneys held by the Trustee under this Trust Agreement, the
Authority shall so instruct the Trustee under this Trust Agreement in writing, and the Trustee
shall take such action as may be necessary in accordance with such instructions.
(d) Notwithstanding any provisions of this Section 6.03, if the Authority
shall provide to the Trustee an Opinion of Counsel that any specified action required under this
Section 6.03 or the Tax Certificate is no longer required or that some further or different action
is required to maintain the exclusion from federal income tax of interest on the Bonds, the
Trustee and the Authority may conclusively rely on such opinion in complying with the
requirements of this Section, and, notwithstanding Article IX hereof, the covenants hereunder
shall be deemed to be modified to that extent.
(e) The foregoing provisions of this Section 6.03 shall not be applicable to
any Series of Bonds or the proceeds thereof that the Authority determines upon the issuance
thereof are to be taxable bonds, the interest on which is intended to be included in the gross
income of the Owner thereof for federal income tax purposes.
SECTION 6.04 Accounting Records and Reports. The Trustee will keep or cause
to be kept proper books of record and accounts in which complete and correct entries shall be
made of all transactions relating to the receipts, disbursements, allocation and application of the
Pledged Revenues, and such books shall be available for inspection by the Authority at
reasonable hours and under reasonable conditions. The Trustee shall provide to the Authority
monthly statements covering the funds and accounts held pursuant to the Trust Agreement. Not
more than one hundred eighty (180) days after the close of each Fiscal Year, the Trustee shall
furnish or cause to be furnished to the Authority a complete financial statement (which may be in
the form of the Trustee’s customary account statements) covering receipts, disbursements,
allocation and application of Pledged Revenues for such Fiscal Year. The Authority shall keep
or cause to be kept such information as is required under the Tax Certificate.
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SECTION 6.05 Prosecution and Defense of Suits. The Authority will defend
against every suit, action or proceeding at any time brought against the Trustee upon any claim
to the extent arising out of the receipt, application or disbursement of any of the Pledged
Revenues or to the extent involving the failure of the Authority to fulfill its obligations
hereunder; provided, that the Trustee or any affected Bondholder at its election may appear in
and defend any such suit, action or proceeding. The Authority will indemnify and hold harmless
the Trustee against any and all liability claimed or asserted by any person to the extent arising
out of such failure by the Authority, and will indemnify and hold harmless the Trustee against
any reasonable attorney’s fees or other reasonable expenses which it may incur in connection
with any litigation to which it may become a party by reason of its actions hereunder, except for
any loss, cost, damage or expense resulting from the negligence or willful misconduct by the
Trustee. Notwithstanding any contrary provision hereof, this covenant shall remain in full force
and effect even though all Bonds secured hereby may have been fully paid and satisfied.
SECTION 6.06 Further Assurances. Whenever and so often as reasonably
requested to do so by the Trustee or any Bondholder, the Authority will promptly execute and
deliver or cause to be executed and delivered all such other and further assurances, documents or
instruments, and promptly do or cause to be done all such other and further things as may be
necessary or reasonably required in order to further and more fully vest in the Bondholders all
rights, interests, powers, benefits, privileges and advantages conferred or intended to be
conferred upon them hereby.
SECTION 6.07 Maintenance of Revenues. The Authority will promptly collect all
user charges due for the use of the Project as the same become due, and will promptly and
vigorously enforce its rights against any User who does not pay such charges as they become
due. The Authority will at all times maintain and vigorously enforce all of its rights under the
Operating Agreements.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES OF BONDHOLDERS
SECTION 7.01 Events of Default and Acceleration of Maturities. If one or more
of the following events (herein called “events of default”) shall happen, that is to say:
(a) if default shall be made by the Authority in the due and punctual payment
of the interest on any Bond when and as the same shall become due and payable;
(b) if default shall be made by the Authority in the due and punctual payment
of the principal of any Bond when and as the same shall become due and payable, whether at
maturity as therein expressed or by proceedings for mandatory redemption;
(c) if default shall be made by the Authority in the performance of any of the
other agreements or covenants required herein to be performed by the Authority, and such
default shall have continued for a period of sixty (60) days or such additional time (with respect
to agreements or covenants that cannot be corrected or performed within such sixty (60) day
period but the correction of which is being diligently pursued by the Authority) as is reasonably
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required to correct any such default after the Authority shall have been given notice in writing of
such default by the Trustee; or
(d) if the Authority shall file a petition or answer seeking arrangement or
reorganization under the federal bankruptcy laws or any other applicable law of the United States
of America or any state therein, or if a court of competent jurisdiction shall approve a petition
filed with or without the consent of the Authority seeking arrangement or reorganization under
the federal bankruptcy laws or any other applicable law of the United States of America or any
state therein, or if under the provisions of any other law for the relief or aid of debtors any court
of competent jurisdiction shall assume custody or control of the Authority or of the whole or any
substantial part of its property; then and in each and every such case during the continuance of
such event of default the Trustee, upon the written request of the Bondholders of not less than a
majority in aggregate principal amount of the Bonds then Outstanding shall, by notice in writing
to the Authority, declare the principal of all Bonds then Outstanding and the interest accrued
thereon to be due and payable immediately, and upon any such declaration the same shall
become due and payable, anything contained herein or in the Bonds to the contrary
notwithstanding. The Trustee shall promptly notify all Bondholders by first class mail of any
such event of default which is continuing of which a Responsible Officer has actual knowledge
or written notice.
This provision, however, is subject to the condition that if at any time after the
principal of the Bonds then Outstanding shall have been so declared due and payable and before
any judgment or decree for the payment of the money due shall have been obtained or entered
the Authority shall deposit with the Trustee a sum sufficient to pay all matured interest on all the
Bonds and all principal of the Bonds matured prior to such declaration, with interest at the rate
borne by such Bonds on such overdue interest and principal, and the reasonable fees and
expenses of the Trustee, and any and all other defaults known to the Trustee (other than in the
payment of interest on and principal of the Bonds due and payable solely by reason of such
declaration) shall have been made good or cured to the satisfaction of the Trustee or provision
deemed by the Trustee to be adequate shall have been made therefor, then and in every such case
the Trustee or the Bondholders of not less than a majority in aggregate principal amount of
Bonds then Outstanding, by written notice to the Authority and to the Trustee, may on behalf of
the Bondholders of all the Bonds then Outstanding rescind and annul such declaration and its
consequences; but no such rescission and annulment shall extend to or shall affect any
subsequent default or shall impair or exhaust any right or power consequent thereon.
SECTION 7.02 Application of Funds Upon Acceleration. All moneys in the
accounts and funds provided in Sections 3.01, 3.02, 5.02, 5.03 and 5.04 upon the date of the
declaration of acceleration by the Trustee as provided in Section 7.01 and all Pledged Revenues
(other than Service Payments on deposit in the Rebate Fund) thereafter received by the Authority
hereunder shall be transmitted to the Trustee and shall be applied by the Trustee in the following
order –
First, to the payment of the reasonable fees, costs and expenses of the Trustee in
providing for the declaration of such event of default and carrying out its duties under this
Agreement, including reasonable compensation to their accountants and counsel together with
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interest on any amounts advanced as provided herein and thereafter to the payment of the
reasonable costs and expenses of the Bondholders, if any, in carrying out the provisions of this
Article, including reasonable compensation to their accountants and counsel; and
Second, upon presentation of the several Bonds, and the stamping thereon of the
amount of the payment if only partially paid or upon the surrender thereof if fully paid, to the
payment of the whole amount then owing and unpaid upon the Bonds for interest and principal,
with (to the extent permitted by law) interest on the overdue interest and principal at the rate
borne by such Bonds, and in case such money shall be insufficient to pay in full the whole
amount so owing and unpaid upon the Bonds, then to the payment of such interest, principal and
(to the extent permitted by law) interest on overdue interest and principal without preference or
priority among such interest, principal and interest on overdue interest and principal ratably to
the aggregate of such interest, principal and interest on overdue interest and principal.
SECTION 7.03 Institution of Legal Proceedings by Trustee. If one or more of the
events of default shall happen and be continuing, the Trustee may, and upon the written request
of the Bondholders of a majority in principal amount of the Bonds then Outstanding, and in each
case upon being indemnified to its reasonable satisfaction therefor, shall, proceed to protect or
enforce its rights or the rights of the Bondholders of Bonds under this Trust Agreement by a suit
in equity or action at law, either for the specific performance of any covenant or agreement
contained herein, or in aid of the execution of any power herein granted, or by mandamus or
other appropriate proceeding for the enforcement of any other legal or equitable remedy as the
Trustee shall deem most effectual in support of any of its rights and duties hereunder.
SECTION 7.04 Non-Waiver. Nothing in this Article or in any other provision
hereof or in the Bonds shall affect or impair the obligation of the Authority, which is absolute
and unconditional, to pay the interest on and principal of and redemption premiums, if any, on
the Bonds to the respective Bondholders of the Bonds at the respective dates of maturity or upon
prior redemption as provided herein from the Pledged Revenues as provided herein pledged for
such payment, or shall affect or impair the right of such Bondholders, which is also absolute and
unconditional, to institute suit to enforce such payment by virtue of the contract embodied herein
and in the Bonds.
A waiver of any default or breach of duty or contract by the Trustee or any
Bondholder shall not affect any subsequent default or breach of duty or contract or impair any
rights or remedies on any such subsequent default or breach of duty or contract. No delay or
omission by the Trustee or any Bondholder to exercise any right or remedy accruing upon any
default or breach of duty or contract shall impair any such right or remedy or shall be construed
to be a waiver of any such default or breach of duty or contract or an acquiescence therein, and
every right or remedy conferred upon the Bondholders by the Act or by this Article may be
enforced and exercised from time to time and as often as shall be deemed expedient by the
Trustee or the Bondholders.
If any action, proceeding or suit to enforce any right or exercise any remedy is
abandoned, the Authority, the Trustee and any Bondholder shall be restored to their former
positions, rights and remedies as if such action, proceeding or suit had not been brought or taken.
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SECTION 7.05 Actions by Trustee as Attorney-in-Fact. Any action, proceeding or
suit which any Bondholder shall have the right to bring to enforce any right or remedy hereunder
may be brought by the Trustee for the equal benefit and protection of all Bondholders, whether
or not the Trustee is a Bondholder, and the Trustee is hereby appointed (and the successive
Bondholders, by taking and holding the Bonds issued hereunder, shall be conclusively deemed to
have so appointed it) the true and lawful attorney-in-fact of the Bondholders for the purpose of
bringing any such action, proceeding or suit and for the purpose of doing and performing any
and all acts and things for and on behalf of the Bondholders as a class or classes as may be
advisable or necessary in the opinion of the Trustee as such attorney-in-fact.
SECTION 7.06 Remedies Not Exclusive. No remedy herein conferred upon or
reserved to the Bondholders is intended to be exclusive of any other remedy, and each such
remedy shall be cumulative and shall be in addition to every other remedy given hereunder or
now or hereafter existing at law or in equity or by statute or otherwise and may be exercised
without exhausting and without regard to any other remedy conferred by the Act or any other
law.
SECTION 7.07 Limitation on Bondholders’ Right to Sue. No Bondholder of any
Bond issued hereunder shall have the right to institute any suit, action or proceeding at law or
equity, for any remedy under or upon this Trust Agreement, unless (a) such Bondholder shall
have previously given to the Trustee written notice of the occurrence of an event of default as
defined in Section 7.01; (b) the Bondholders of at least a majority in aggregate principal amount
of all the Bonds then Outstanding shall have made written request upon the Trustee to exercise
the powers hereinbefore granted or to institute such suit, action or proceeding in its own name;
(c) said Bondholders shall have tendered to the Trustee reasonable security or indemnity against
the costs, expenses and liabilities to be incurred in compliance with such request; and (d) the
Trustee shall have refused or omitted to comply with such request for a period of sixty (60) days
after such request shall have been received by, and said tender of indemnity shall have been
made to, the Trustee.
Such notification, request, tender of indemnity and refusal or omission are hereby
declared, in every case, to be conditions precedent to the exercise by any Bondholder of Bonds
of any remedy hereunder; it being understood and intended that no one or more Bondholders of
Bonds shall have any right in any manner whatever by his or their action to enforce any right
under this Trust Agreement, except in the manner herein provided, and that all proceedings at
law or in equity to enforce any provision of this Trust Agreement shall be instituted, had and
maintained in the manner herein provided and for the equal benefit of all Bondholders of the
Outstanding Bonds.
ARTICLE VIII
THE TRUSTEE
SECTION 8.01 The Trustee. Deutsche Bank National Trust Company, shall serve
as the initial Trustee for the Bonds for the purpose of receiving all money which the Authority is
required to deposit with the Trustee hereunder and for the purpose of allocating, applying and
using such money as provided herein and for the purpose of paying the interest on and principal
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of and redemption premiums, if any, on the Bonds presented for payment, with the rights and
obligations provided herein. The Authority agrees that it will at all times maintain a Trustee
having a principal office in California.
The Authority, unless there exists any Event of Default as defined in Section 7.01,
may at any time remove the Trustee initially appointed and any successor thereto and may
appoint a successor or successors thereto by an instrument in writing; provided, that any such
successor shall be a bank, banking institution, or trust company, having (or whose parent holding
company has) a combined capital (exclusive of borrowed capital) and surplus of at least fifty
million dollars ($50,000,000) and subject to supervision or examination by federal or state
authority. If such bank, banking institution, or trust company publishes a report of condition at
least annually, pursuant to law or to the requirements of any supervising or examining authority
above referred to, then for the purpose of this Section the combined capital and surplus of such
bank, banking institution, or trust company shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. The Trustee may at any
time resign by giving written notice of such resignation to the Authority, and by mailing by first
class mail to the Bondholders notice of such resignation. Upon receiving such notice of
resignation, the Authority shall promptly appoint a successor Trustee by an instrument in
writing. Any removal or resignation of a Trustee and appointment of a successor Trustee shall
become effective only upon the acceptance of appointment by the successor Trustee. The
successor Trustee shall send notice of its acceptance by first class mail to the Bondholders. If,
within thirty (30) days after notice of the removal or resignation of the Trustee no successor
Trustee shall have been appointed and shall have accepted such appointment, the removed or
resigning Trustee may petition any court of competent jurisdiction for the appointment of a
successor Trustee, which court may thereupon, after such notice, if any, as it may deem proper
and prescribe and as may be required by law, appoint a successor Trustee having the
qualifications required hereby.
The Trustee is hereby authorized to pay or redeem the Bonds when duly presented
for payment at maturity or on redemption prior to maturity. The Trustee shall cancel all Bonds
upon payment thereof or upon the surrender thereof by the Authority and shall destroy such
Bonds and a certificate of destruction shall be delivered to the Authority upon its request. The
Trustee shall keep accurate records of all Bonds paid and discharged and canceled by it.
The Trustee shall, prior to an event of default, and after the curing of all events of
default that may have occurred, perform such duties and only such duties as are specifically set
forth in this Trust Agreement and no implied duties or obligations shall be read into this Trust
Agreement. The Trustee shall, during the existence of any event of default (that has not been
cured), exercise such of the rights and powers vested in it by this Trust Agreement, and use the
same degree of care and skill in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
SECTION 8.02 Liability of Trustee. The recitals of facts, agreements and
covenants herein and in the Bonds shall be taken as recitals of facts, agreements and covenants
of the Authority, and the Trustee assumes no responsibility for the correctness of the same or
makes any representation as to the sufficiency or validity hereof or of the Bonds, or shall incur
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any responsibility in respect thereof other than in connection with the rights or obligations
assigned to or imposed upon it herein, in the Bonds or in law or equity. The Trustee shall not be
liable in connection with the performance of its duties hereunder except for its own negligence or
willful misconduct.
The Trustee shall not be bound to recognize any person as the Bondholder of a
Bond unless and until such Bond is submitted for inspection, if required, and such Bondholder’s
title thereto satisfactorily established, if disputed.
The Trustee shall not be liable for any error of judgment made in good faith,
unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts.
The Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Bondholders of not less than a
majority (or any lesser amount that may direct the Trustee in accordance with this Agreement) in
aggregate principal amount of the Bonds at the time Outstanding, relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee under this Trust Agreement.
The Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Trust Agreement at the request, order or direction of any of the Bondholders
pursuant to the provisions of this Trust Agreement unless such Bondholders shall have offered to
the Trustee reasonable security or indemnity against the reasonable costs, expenses and liabilities
that may be incurred therein or thereby. The Trustee has no obligation or liability to the
Bondholders for the payment of the interest on, principal of or redemption premium, if any, with
respect to the Bonds from its own funds; but rather the Trustee’s obligations shall be limited to
the performance of its duties hereunder.
The Trustee shall not be deemed to have knowledge of any event of default
(except payment defaults) unless and until a Responsible Officer shall have actual knowledge
thereof or a Responsible Officer of the Trustee shall have received written notice thereof at its
Principal Office. The Trustee shall not be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or of any of the
documents executed in connection with the Bonds, or as to the existence of a default or event of
default thereunder. The Trustee shall not be responsible for the validity or effectiveness of any
collateral given to or held by it.
The Trustee may execute any of the trusts or powers hereunder or perform any
duties hereunder either directly or by or through attorneys-in-fact, agents or receivers, but shall
be answerable for the negligence or misconduct of any such attorney-in-fact, agent or receiver.
The Trustee shall be entitled to advice of counsel and other professionals concerning all matters
of trust and its duty hereunder, but the Trustee shall not be answerable for the professional
malpractice of any attorney-in-law or certified public accountant in connection with the
rendering of his professional advice in accordance with the terms of this Trust Agreement, if
such attorney-in-law or certified public accountant was selected by the Trustee with due care.
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The Trustee shall not be concerned with or accountable to anyone for the
subsequent use or application of any moneys which shall be released or withdrawn in accordance
with the provisions hereof.
Whether or not therein expressly so provided, every provision of this Trust
Agreement or related documents relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Article.
The Trustee makes no representation or warranty, express or implied, as to the
title, value, design, compliance with specifications or legal requirements, quality, durability,
operation, condition, merchantability or fitness for any particular purpose for the use
contemplated by the Authority or County of the Facilities or the Project. In no event shall the
Trustee be liable for incidental, indirect, special or consequential damages in connection with or
arising from this Trust Agreement for the existence, furnishing or use of the Facilities or the
Project.
The Trustee shall be protected in acting upon any notice, resolution, requisition,
request (including any Written Request of the Authority or the County), consent, order,
certificate, report, opinion, bond or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties. Before the Trustee acts or refrains
from acting, the Trustee may consult with counsel, who may be counsel of or to the Authority,
with regard to legal questions, and the opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken or suffered by it hereunder in good
faith and in accordance therewith.
Whenever in the administration of its rights and obligations hereunder the Trustee
shall deem it necessary or desirable that a matter be established or proved prior to taking or
suffering any action hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of bad faith on the part of the Trustee, be deemed to
be conclusively proved and established by a Certificate of the Authority, which certificate shall
be full warrant to the Trustee for any action taken or suffered under the provisions hereof upon
the faith thereof, but in its discretion the Trustee may in lieu thereof accept other evidence of
such matter or may require such additional evidence as it may deem reasonable.
No provision of this Trust Agreement shall require the Trustee to expend or risk
its own funds or otherwise incur any financial liability in the performance or exercise of any of
its duties hereunder, or in the exercise of its rights or powers.
The Trustee is not responsible for the content of any official statement or any
other offering or disclosure material prepared in connection with the Bonds.
SECTION 8.03 Compensation and Indemnification of Trustee. The Authority
covenants to pay (but solely from Operating Payments) to the Trustee from time to time, and the
Trustee shall be entitled to, compensation for all services rendered by it in the exercise and
performance of any of the powers and duties hereunder of the Trustee, and the Authority will pay
or reimburse the Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee, in accordance with any of the provisions of this Trust
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Agreement (including the reasonable compensation and the reasonable expenses and
disbursements of their counsel (including the allocated reasonable fees and disbursements of in-
house counsel) and of all persons not regularly in their employ) except any such expense,
disbursement or advance as may arise from their negligence or willful misconduct. The
Authority, to the extent permitted by law, shall indemnify, defend and hold harmless the Trustee
against any loss, damage, liability or expense incurred without negligence or willful misconduct
on the part of the Trustee arising out of or in connection with the acceptance or administration of
the trusts created hereby, including reasonable costs and expenses (including reasonable
attorneys’ fees and disbursements) of defending itself against or investigating any claim or
liability in connection with the exercise or performance of any of its powers hereunder. The
rights of the Trustee and the obligations of the Authority under this Section 8.03 shall survive the
discharge of the Bonds and this Trust Agreement and the resignation or removal of the Trustee.
ARTICLE IX
AMENDMENT OF THE TRUST AGREEMENT
SECTION 9.01 Amendment of the Trust Agreement.
(a) This Trust Agreement and the rights and obligations of the Authority and
of the Bondholders may be amended at any time by a Supplemental Trust Agreement which shall
become binding when the written consent of the Bondholders of a majority in aggregate principal
amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section
9.02, are filed with the Trustee; provided that if such modification or amendment will, by its
terms, not take effect so long as any Bonds of any particular maturity or Series remain
Outstanding, the consent of the Owners of such Bonds shall not be required and such Bonds shall
not be deemed to be Outstanding for the purpose of any calculation of Bonds Outstanding under
this Section. No such amendment shall (1) extend the maturity of or reduce the interest rate on
or amount of interest on or principal of or redemption premium, if any, on any Bond without the
express written consent of the Bondholder of such Bond, or (2) permit the creation by the
Authority of any pledge of or charge or lien upon the Pledged Revenues as provided herein
superior to or on a parity with the pledge, charge and lien created hereby for the benefit of the
Bonds, or (3) reduce the percentage of Bonds required for the written consent to any such
amendment, or (4) modify any rights or obligations of the Trustee, the Authority, or the Counties
without their prior written assent thereto, respectively. It shall not be necessary for the consent
of the Bondholders to approve the particular form of any Supplemental Trust Agreement, but it
shall be sufficient if such consent shall approve the substance thereof. Promptly after the
execution by the Authority and the Trustee of any Supplemental Trust Agreement pursuant to
this subsection (a), the Trustee shall mail a notice on behalf of the Authority, setting forth in
general terms the substance of such Supplemental Trust Agreement to the Bondholders at the
addresses shown on the registration books maintained by the Trustee. Any failure to give such
notice, or any defect therein, shall not, however, in any way impair or affect the validity of any
such Supplemental Trust Agreement.
(b) The Trust Agreement and the rights and obligations of the Authority and
of the Bondholders may also be amended at any time by a Supplemental Trust Agreement which
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shall become binding upon adoption but without the consent of any Bondholders, for any
purpose that will not materially adversely affect the interests of the Bondholders, including
(without limitation) for any one or more of the following purposes –
(i) to add to the agreements and covenants required herein to be performed by
the Authority other agreements and covenants thereafter to be performed by the
Authority, or to surrender any right or power reserved herein to or conferred herein on the
Authority;
(ii) to make such provisions for the purpose of curing any ambiguity or of
correcting, curing or supplementing any defective provision contained herein or in regard
to questions arising hereunder which the Authority may deem desirable or necessary;
(iii) to provide for the issuance of any Additional Bonds and to provide the
terms of such Additional Bonds, including provisions for full book-entry registration of
such Additional Bonds, subject to the conditions and upon compliance with the procedure
set forth in Article III (which shall be deemed not to adversely affect Bondholders);
(iv) to add to the agreements and covenants required herein, such agreements
and covenants as may be necessary to qualify the Trust Agreement under the Trust
Indenture Act of 1939; or
SECTION 9.02 Disqualified Bonds. Bonds owned or held by or for the account of
the Authority shall not be deemed Outstanding for the purpose of any consent or other action or
any calculation of Outstanding Bonds provided in this Article, and shall not be entitled to
consent to or take any other action provided in this Article.
SECTION 9.03 Endorsement or Replacement of Bonds After Amendment. After
the effective date of any action taken as hereinabove provided, the Authority may determine that
the Bonds may bear a notation by endorsement in form approved by the Authority as to such
action, and in that case upon demand of the Bondholder of any Outstanding Bonds and
presentation of his Bond for such purpose at the office of the Trustee a suitable notation as to
such action shall be made on such Bond. If the Authority shall so determine, new Bonds so
modified as, in the opinion of the Authority, shall be necessary to conform to such action shall be
prepared and executed, and in that case upon demand of the Bondholder of any Outstanding
Bond a new Bond or Bonds shall be exchanged at the office of the Trustee without cost to each
Bondholder for its Bond or Bonds then Outstanding upon surrender of such Outstanding Bonds.
SECTION 9.04 Amendment by Mutual Consent. The provisions of this Article
shall not prevent any Bondholder from accepting any amendment as to the particular Bonds held
by him, provided that due notation thereof is made on such Bonds.
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ARTICLE X
DEFEASANCE
SECTION 10.01 Discharge of Bonds.
(a) If the Authority shall pay or cause to be paid or there shall otherwise be
paid to the Bondholders of all or any portion of the Outstanding Bonds the interest thereon and
principal thereof and redemption premiums, if any, thereon at the times and in the manner
stipulated herein and therein, and the Authority shall pay in full all other amounts due hereunder
then the Bondholders of such Bonds shall cease to be entitled to the pledge of and charge and
lien upon the Pledged Revenues as provided herein, and all agreements, covenants and other
obligations of the Authority to the Bondholders of such Bonds hereunder shall thereupon cease,
terminate and become void and be discharged and satisfied. In such event, the Trustee shall
execute and deliver to the Authority all such instruments as may be necessary or desirable to
evidence such discharge and satisfaction, the Trustee shall pay over or deliver to the Authority
all money or securities held by it pursuant hereto which are not required for the payment of the
interest on and principal of and redemption premiums, if any, on such Bonds and for the payment
of all other amounts due hereunder.
(b) Any Outstanding Bonds shall prior to the maturity date or redemption date
thereof be deemed to have been paid within the meaning of and with the effect expressed in
subsection (a) of this Section if (1) in case any of such Bonds are to be redeemed on any date
prior to their maturity date, the Authority shall have given to the Trustee in form satisfactory to it
irrevocable instructions to provide notice in accordance with Section 4.05, (2) there shall have
been deposited with the Trustee (A) cash in an amount which shall be sufficient and/or
(B) noncallable Government Securities, the interest on and principal of which when paid will
provide cash which, together with the cash, if any, deposited with the Trustee at the same time,
in the opinion of an Independent Certified Public Accountant, shall be sufficient to pay when due
the interest to become due on such Bonds on and prior to the maturity date or redemption date
thereof, as the case may be, and the principal of and redemption premiums, if any, on such
Bonds, and (3) in the event such Bonds are not by their terms subject to redemption within the
next succeeding sixty (60) days, the Authority shall have given the Trustee in form satisfactory
to it irrevocable instructions to mail as soon as practicable, a notice to the Bondholders of such
Bonds that the deposit required by clause (2) above has been made with the Trustee and that such
Bonds are deemed to have been paid in accordance with this Section and stating the maturity
date or redemption date upon which money is to be available for the payment of the principal of
and redemption premiums, if any, on such Bonds.
(c) In the event of an advance refunding (i) the Authority shall cause to be
delivered, on the deposit date and upon any reinvestment of the defeasance amount, a report of
an independent firm of nationally recognized certified public accountants (“Accountants”)
verifying the sufficiency of the escrow established to pay the Bonds in full on the maturity date
or redemption date (“Verification”), (ii) the escrow agreement shall provide that no
(A) substitution of a Government Security shall be permitted except with another Government
Security and upon delivery of a new Verification and (B) reinvestment of a Government Security
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shall be permitted except as contemplated by the original Verification or upon delivery of a new
Verification, and (iii) there shall be delivered an Opinion of Bond Counsel to the effect that the
Bonds are no longer “Outstanding” under the Trust Agreement and if the Related County Bond
is still outstanding, that the tax exempt status of such bond is not adversely affected thereby;
each Verification and opinion shall be addressed to the Authority and the Trustee.
SECTION 10.02 Unclaimed Money. Anything contained herein to the contrary
notwithstanding, any money held by the Trustee in trust for the payment and discharge of any of
the Bonds or interest thereon which remains unclaimed for two (2) years after the date when such
Bonds or interest thereon have become due and payable, either at their stated maturity dates or
by call for redemption prior to maturity, if such money was held by the Trustee at such date, or
for two (2) years after the date of deposit of such money if deposited with the Trustee after the
date when such Bonds have become due and payable, shall be repaid by the Trustee to the
Authority as its absolute property free from trust, and the Trustee shall thereupon be released and
discharged with respect thereto and the Bondholders shall not look to the Trustee for the
payment of such Bonds.
ARTICLE XI
MISCELLANEOUS
SECTION 11.01 Liability of Authority Limited to Pledged Revenues.
Notwithstanding anything contained herein, the Authority shall not be required to advance any
money derived from any source other than the Pledged Revenues as provided herein for the
payment of the interest on or principal of or redemption premiums, if any, on the Bonds or for
the performance of any agreements or covenants herein contained. The Authority may, however,
advance funds for any such purpose so long as such funds are derived from a source legally
available for such purpose.
The Bonds are limited obligations of the Authority and are payable, as to interest
thereon, principal thereof and any premiums upon the redemption of any thereof, solely from the
Pledged Revenues as provided herein, and the Authority is not obligated to pay them except from
the Pledged Revenues. All the Bonds are equally secured by a pledge of and charge and lien
upon the Pledged Revenues, and the Pledged Revenues constitute a trust fund for the security
and payment of the interest on and principal of and redemption premiums, if any, on the Bonds
as provided herein. The Bonds are not a debt of the Counties, the State or any of its political
subdivisions, and neither the Counties, the State nor any of its political subdivisions is liable
thereon, nor in any event shall the Bonds be payable out of any funds or properties other than
those of the Authority as provided herein. The Bonds do not constitute an indebtedness within
the meaning of any constitutional or statutory limitation or restriction.
SECTION 11.02 Benefits of this Trust Agreement Limited to Parties and Third
Party Beneficiaries. Nothing contained herein, expressed or implied, is intended to give to any
person other than the Authority, the Trustee, and the Bondholders any right, remedy or claim
under or by reason hereof. Any agreement or covenant required herein to be performed by or on
behalf of the Authority or any member, officer or employee thereof shall be for the sole and
exclusive benefit of the Authority, the Trustee and the Bondholders.
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SECTION 11.03 Successor Is Deemed Included In All References To Predecessor.
Whenever herein either the Authority or any member, officer or employee thereof or of the State
is named or referred to, such reference shall be deemed to include the successor to the powers,
duties and functions with respect to the Project that are presently vested in the Authority or such
member, officer or employee, and all agreements and covenants required hereby to be performed
by or on behalf of the Authority or any member, officer or employee thereof shall bind and inure
to the benefit of the respective successors thereof whether so expressed or not.
SECTION 11.04 Execution of Documents by Bondholders. Any declaration,
request or other instrument which is permitted or required herein to be executed by Bondholders
may be in one or more instruments of similar tenor and may be executed by Bondholders in
person or by their attorneys appointed in writing. The fact and date of the execution by any
Bondholder or his attorney of any declaration, request or other instrument or of any writing
appointing such attorney may be proved by the certificate of any notary public or other officer
authorized to make acknowledgments of deeds to be recorded in the state or territory in which he
purports to act that the person signing such declaration, request or other instrument or writing
acknowledged to him the execution thereof, or by an affidavit of a witness of such execution
duly sworn to before such notary public or other officer. The ownership of any Bonds and the
amount, maturity, number and date of holding the same may be proved by the registration books
relating to the Bonds at the Principal Office of the Trustee.
Any declaration, request, consent or other instrument or writing of the
Bondholder of any Bond shall bind all future Bondholders of such Bond with respect to anything
done or suffered to be done by the Trustee or the Authority in good faith and in accordance
therewith.
SECTION 11.05 Waiver of Personal Liability. No member, officer or employee of
the Authority or either of the Counties shall be individually or personally liable for the payment
of the interest on or principal of or redemption premiums, if any, on the Bonds by reason of their
issuance, but nothing herein contained shall relieve any such member, officer or employee from
the performance of any official duty provided by the Act or any other applicable provisions of
law or hereby.
SECTION 11.06 Destruction of Canceled Bonds. Whenever provision is made for
the return to the Authority of any Bonds which have been Canceled pursuant to the provisions
hereof, the Authority may, by a Written Request of the Authority, direct the Trustee to destroy
such Bonds and furnish to the Authority a certificate of such destruction.
SECTION 11.07 Content of Certificates. Every Certificate of the Authority with
respect to compliance with any agreement, condition, covenant or provision provided herein
shall include (a) a statement that the person or persons making or giving such certificate have
read such agreement, condition, covenant or provision and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or investigation upon which
the statements contained in such certificate are based; (c) a statement that, in the opinion of the
signers, they have made or caused to be made such examination or investigation as is necessary
to enable them to express an informed opinion as to whether or not such agreement, condition,
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covenant or provision has been complied with; and (d) a statement as to whether, in the opinion
of the signers, such agreement, condition, covenant or provision has been complied with.
Any Certificate of the Authority may be based, insofar as it relates to legal
matters, upon an Opinion of Counsel unless the person making or giving such certificate knows
that the Opinion of Counsel with respect to the matters upon which his certificate may be based,
as aforesaid, is erroneous, or in the exercise of reasonable care should have known that the same
was erroneous. Any Opinion of Counsel may be based, insofar as it relates to factual matters
information with respect to which is in the possession of the Authority, upon a representation by
an officer or officers of the Authority unless the counsel executing such Opinion of Counsel
knows that the representation with respect to the matters upon which his opinion may be based,
as aforesaid, is erroneous, or in the exercise of reasonable care should have known that the same
was erroneous.
SECTION 11.08 Accounts and Funds. Any account or fund required herein to be
established and maintained by the Trustee may be established and maintained in the accounting
records of the Trustee either as an account or a fund, and may, for the purposes of such
accounting records, any audits thereof and any reports or statements with respect thereto, be
treated either as an account or a fund; but all such records with respect to all such accounts and
funds shall at all times be maintained in accordance with corporate trust industry standards and
with due regard for the protection of the security of the Bonds and the rights of the Bondholders.
SECTION 11.09 Business Day. When any action is provided for herein to be done
on a day named or within a specified time period, and the day or the last day of the period falls
on a day which is not a Business Day, such action may be performed on the next ensuing
Business Day with the same effect as though performed on the appointed day or within the
specified period.
SECTION 11.10 Notices; Notices to Rating Agencies. All written notices to be
given hereunder shall be given by mail to the party entitled thereto at the addresses set forth
below, or at such other addresses as such parties may provide to the other party in writing from
time to time, namely:
If to the Authority: East Bay Regional Communications System
Authority
4985 Broder Boulevard
Dublin, CA 94568
Attn: William J. McCammon
Telephone: (925) 803-7802
Facsimile: (925) 803-7878
If to the Trustee: Deutsche Bank National Trust Company
Trust & Securities Services
1761 East St. Andrew Place
Santa Ana, CA 92705-4934
Telephone: (714) 247-6038
Facsimile: (714) 247-6035
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42
If to the Counties: County of Contra Costa
Office of the County Administrator
651 Pine Street, 10th Floor
Martinez, CA 94553
Attn: Lisa Driscoll, County Finance Director
Telephone: (925) 335-1023
Facsimile: (925) 646-1353
County of Alameda
1221 Oak Street
Oakland, CA 94612
Attn: Donna Linton, Assistant County
Administrator
Telephone: (510) 208-4909
Facsimile: (510) 208-3999
The Trustee shall give written notice to the Counties of the redemption or
defeasance of any Bonds, the amendment of the Trust Agreement and any change in the Trustee
in accordance herewith.
SECTION 11.11 Article and Section Headings and References. The headings or
titles of the several articles and sections hereof and the table of contents appended hereto shall be
solely for convenience of reference and shall not affect the meaning, construction or effect
hereof. All references herein to “Articles,” “Sections” and other subdivisions or clauses are to
the corresponding articles, sections, subdivisions or clauses hereof; and the words “hereby,”
“herein,” “hereof,” “hereto,” “herewith,” “hereunder” and other words of similar import refer to
this Trust Agreement as a whole and not to any particular article, section, subdivision or clause
hereof.
SECTION 11.12 Partial Invalidity. If any one or more of the agreements or
covenants or portions thereof required hereby to be performed by or on the part of the Authority
or the Trustee shall be contrary to law, then such agreement or agreements, such covenant or
covenants or such portions thereof shall be null and void and shall be deemed separable from the
remaining agreements and covenants or portions thereof and shall in no way affect the validity
hereof or of the Bonds, and the Bondholders shall retain all the benefit, protection and security
afforded to them under the Act or any other applicable provisions of law. The Authority and the
Trustee hereby declare that they would have executed and delivered this Trust Agreement and
each and every other article, section, paragraph, subdivision, sentence, clause and phrase hereof
and would have authorized the issuance of the Bonds pursuant hereto irrespective of the fact that
any one or more articles, sections, paragraphs, subdivisions, sentences, clauses or phrases hereof
or the application thereof to any person or circumstance may be held to be unconstitutional,
unenforceable or invalid.
SECTION 11.13 Governing Law. This Trust Agreement shall be governed
exclusively by the provisions hereof and by the laws of the State as the same from time to time
exist.
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43
SECTION 11.14 Execution in Several Counterparts. This Trust Agreement may be
executed in any number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original; and all such counterparts, or as many of them as the Authority and the
Trustee shall preserve undestroyed, shall together constitute but one and the same instrument.
OHS WEST:260976438.14
44
IN WITNESS WHEREOF, the EAST BAY REGIONAL COMMUNICATIONS
SYSTEM AUTHORITY has caused this Trust Agreement to be signed in its name by its
Executive Director, and Deutsche Bank National Trust Company in acceptance of the trusts
created hereunder, has caused this Trust Agreement to be signed by one of its duly authorized
officers, all as of the day and year first above written.
EAST BAY REGIONAL COMMUNICATIONS
SYSTEM AUTHORITY
By:
Executive Director
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By:
Authorized Officer
OHS WEST:260976438.14
A-1
EXHIBIT A
[FORM OF BOND]
No. _____ $__________
EAST BAY REGIONAL COMMUNICATIONS SYSTEM AUTHORITY
REVENUE BOND 2011 SERIES [__]
NEITHER THE FULL FAITH AND CREDIT OF THE
AUTHORITY NOR THE MEMBERS OF THE AUTHORITY IS
PLEDGED FOR THE PAYMENT OF THE INTEREST ON OR
PRINCIPAL OF THE BONDS AND NO TAX OR OTHER
SOURCE OF FUNDS OTHER THAN THE PLEDGED
REVENUES HEREINAFTER REFERRED TO IS PLEDGED TO
PAY THE INTEREST ON OR PRINCIPAL OF THE BONDS.
NEITHER THE PAYMENT OF THE PRINCIPAL OF NOR
INTEREST ON THE BONDS CONSTITUTES A DEBT,
LIABILITY OR OBLIGATION OF THE PARTIES TO THE
AGREEMENT CREATING THE AUTHORITY.
Interest
Rate
Conversion
Date Maturity
Date
Accreted
Value of
Conversion
Dated
Date
____ % June 1, ____ _______, ____
REGISTERED OWNER:
PRINCIPAL SUM: _______________________________________ DOLLARS
The EAST BAY REGIONAL COMMUNICATIONS SYSTEM AUTHORITY, a
joint exercise of powers authority, duly organized and validly existing under and pursuant to the
laws of the State of California (the “Authority”), for value received, hereby promises to pay (but
only out of the Pledged Revenues hereinafter referred to) to the registered owner identified above
or registered assigns, on the maturity date specified above (subject to any right of prior
redemption hereinafter provided for) the principal sum specified above, together with interest on
such principal sum compounded on June 1 and December 1 of each year until and including the
Conversion Date, and after the Conversion Date on the Accredited Value thereon from the
OHS WEST:260976438.14
A-2
interest payment date next preceding the date of authentication of this Bond (unless this Bond is
registered as of an interest payment date or during the period from the fifteenth calendar day of
the month preceding an interest payment date to such interest payment date, in which event it
shall bear interest from such interest payment date, or unless this Bond is authenticated prior to
November 15, 2013, in which event it shall bear interest from the Conversion Date specified
above) until the principal hereof shall have been paid at the interest rate per annum specified
above, payable on December 1, 2013, and semiannually thereafter on each June 1 and
December 1. Interest due on or before the maturity or prior redemption of this Bond shall be
payable only by check mailed by first-class mail to the registered owner hereof; provided that
upon the written request of a Bondholder of $1,000,000 or more in aggregate principal amount of
Bonds of the Series of which this Bond is a part received by the Trustee (defined hereinafter)
prior to the applicable record date, interest shall be paid by wire transfer in immediately available
funds. The principal hereof is payable in lawful money of the United States of America upon
presentation of this Bond at the principal office of the Trustee, provided, however, that principal
on this Bond shall be paid by wire transfer or other means to provide immediately available
funds to any Owner of at least $1,000,000 in aggregate principal amount of this Bond, at its
option, according to wire instructions given to the Trustee in writing for such purpose and on file
as of the 15th day of the month preceding the Principal Payment Date. The Trustee may agree
with the Owner of any Bond or Bonds that such Owner may, in lieu of surrendering the same for
a new Bond, endorse on such Bond a record of partial payment of the principal of such Bond as
set forth in the form entitled “Payments on Account of Principal” attached hereto and made a
part hereof.
This Bond is one of a duly authorized issue of bonds of the Authority designated
as its “East Bay Regional Communications System Authority Revenue Bonds” (the “Bonds”)
unlimited as to principal amount and is the bond of a duly authorized series of such Bonds
known as “2011 Series [__] Bonds” (the “Bonds”) issued in a principal amount of
$____________, and is issued under and pursuant to the provisions of the Joint Exercise of
Powers Act (being Chapter 5 of Division 7 of Title 1 of the California Government Code, as
amended) and all laws amendatory thereof or supplemental thereto (the “Act”) and under and
pursuant to the provisions of a trust agreement, dated as of October 1, 2010 (as amended from
time to time, the “Trust Agreement”), between the Authority and Deutsche Bank National Trust
Company, as trustee (together with any successor as trustee under the Trust Agreement, the
“Trustee”) (copies of the Trust Agreement are on file at the office of the Trustee).
The Bonds are issued to provide funds to finance and refinance the acquisition,
construction, improvement, equipping, remodeling and refinancing of certain facilities, located in
the County of Contra Costa and the County of Alameda (as more fully defined in the Trust
Agreement, the “Project”). The Bonds are limited obligations of the Authority and are payable,
as to interest thereon and principal thereof, solely from certain proceeds of the Bonds held in
certain funds and accounts pursuant to the Trust Agreement and the Pledged Revenues (as more
fully defined in the Trust Agreement, the “Pledged Revenues”) derived from User Payments and
other payments made by the Users of the Project, and all interest or other investment income
thereon, pursuant to the Operating Agreements, (as amended from time to time, the “Operating
Agreements”), by and between the Authority and the Users, and the Authority is not obligated to
pay the interest or premium, if any, on and principal of the Bonds except from the Pledged
Revenues. All Bonds are equally and ratably secured in accordance with the terms and
OHS WEST:260976438.14
A-3
conditions of the Trust Agreement by a pledge and assignment of and charge and lien upon the
Pledged Revenues, and the Pledged Revenues constitute a trust fund for the security and
payment of the interest or premium, if any, on and principal of the Bonds as provided in the
Trust Agreement. The full faith and credit of the Authority, or the Counties of Alameda or
Contra Costa or other members of the Authority are not pledged for the payment of the interest
or premium, if any, on or principal of the Bonds. No tax shall ever be levied to pay the interest
on or principal of the Bonds. The Bonds are not secured by a legal or equitable pledge of or
charge or lien upon any property of the Authority or any of its income or receipts except the
Pledged Revenues, and neither the payment of the interest on nor principal (or premium, if any)
of the Bonds is a debt, liability or general obligation of the Authority, the Counties or any
member of the Authority for which such entity is obligated to levy or pledge any form of
taxation. Additional bonds payable from the Pledged Revenues may be issued which will rank
equally as to security with the Bond, but only subject to the conditions and upon compliance
with the procedures set forth in the Trust Agreement. Reference is hereby made to the Act and
to the Trust Agreement and any and all amendments thereof and supplements thereto for a
description of the terms on which the Bond is issued, the provisions with regard to the nature and
extent of the Pledged Revenues, the rights of the registered owners of the Bonds, security for
payment of the Bonds, remedies upon default and limitations thereon, and amendment of the
Trust Agreement (with or without consent of the registered owners of the Bonds); and all the
terms of the Trust Agreement are hereby incorporated herein and constitute a contract between
the Authority and the registered owner of this Bond, to all the provisions of which the registered
owner of this Bond, by acceptance hereof, agrees and consents.
The Bond is subject to optional redemption prior to its maturity at the written
direction of the Authority, from any moneys deposited by the Authority or the County, as a
whole or in part on any date, in Authorized denominations, together with accrued interest to the
date fixed for redemption, without premium.
Notice of redemption of this Bond shall be given by first-class mail not less than
thirty (30) days nor more than sixty (60) days before the redemption date to the registered owner
of any Bond selected for redemption, subject to and in accordance with provisions of the Trust
Agreement with respect thereto. If notice of redemption has been duly given as aforesaid and
money for the payment of the above-described redemption price is held by the Trustee, then this
Bond shall, on the redemption date designated in such notice, become due and payable at the
above-described redemption price; and from and after the date so designated, interest on this
Bond shall cease to accrue and the registered owner of this Bond shall have no rights with
respect hereto except to receive payment of the redemption price hereof.
If an Event of Default (as defined in the Trust Agreement) shall occur, the
principal of all Bonds may be declared due and payable upon the conditions, in the manner and
with the effect provided in the Trust Agreement. The Trust Agreement provides that in certain
events such declaration and its consequences may be rescinded by the holders of not less than a
majority in aggregate principal amount of the Bonds then outstanding or by the Trustee.
This Bond is not transferable without the prior written consent of the Authority.
The Authority and the Trustee may deem and treat the registered owner hereof as the absolute
owner hereof for the purpose of receiving payment of the interest hereon and principal hereof
OHS WEST:260976438.14
A-4
and for all other purposes, whether or not this Bond shall be overdue, and neither the Authority
nor the Trustee shall be affected by any notice or knowledge to the contrary; and payment of the
interest on and principal of this Bond shall be made only to such registered owner, which
payments shall be valid and effectual to satisfy and discharge liability on this Bond to the extent
of the sum or sums so paid.
This Bond shall not be entitled to any benefit, protection or security under the
Trust Agreement or become valid or obligatory for any purpose until the certificate of
authentication hereon endorsed shall have been executed and dated by the Trustee.
It is hereby certified and recited that all acts, conditions and things required by
law to exist, to have happened and to have been performed precedent to and in the issuance of
this Bond do exist, have happened and have been performed in due time, form and manner as
required by the Act, and by the Constitution and laws of the State of California, that the amount
of this Bond, together with all other indebtedness of the Authority, does not exceed any limit
prescribed by the Constitution or laws of the State of California and is not in excess of the
amount of Bonds permitted to be issued under the Trust Agreement.
IN WITNESS WHEREOF, the East Bay Regional Communications System
Authority has caused this Bond to be executed in its name and on its behalf by the manual or
facsimile signature of the Chair of the Authority and countersigned by the manual or facsimile
signature of the Secretary of said Authority, and has caused this Bond to be dated as of the Dated
Date specified above.
EAST BAY REGIONAL COMMUNICATIONS
SYSTEM AUTHORITY
By
Chair
Countersigned:
________________________________________
Secretary
OHS WEST:260976438.14
A-5
[FORM OF CERTIFICATE OF AUTHENTICATION
TO APPEAR ON BONDS]
This is one of the Bonds described in the within-mentioned Trust Agreement
which has been registered and authenticated on _____________, 2011.
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By
Authorized Signatory
OHS WEST:260976438.14
B-1
EXHIBIT B
FORM OF REQUISITION – PROJECT FUND
Date: _______________
No. __
Deutsche Bank National Trust Company
Re: East Bay Regional Communications System Authority
Revenue Bonds, 2011 Series ______________________
(Written Request of the Authority – 2011 Series __ Project Fund)
Ladies and Gentlemen:
This letter is our authorization to you to disburse from the Project Fund provided
for in Section 3.02 of the Trust Agreement dated as of October 1, 2010 (the “Trust Agreement”)
between the Authority and Deutsche Bank National Trust Company, as trustee, the amounts
indicated on Schedule A attached hereto to the therein-named individuals, firms and corporations
for project costs pursuant to the Trust Agreement.
The obligations in the stated amounts have been incurred by the East Bay
Regional Communications System Authority and each item thereof is a proper charge against the
Project Fund.
□ If checked here you are hereby authorized to close the Project Fund and
transfer any remaining balance (after payment of any amounts indicated in Schedule A) to the
Reserve and Replacement Fund.
Very truly yours,
EAST BAY REGIONAL COMMUNICATIONS
SYSTEM AUTHORITY
By
Authorized Representative
OHS WEST:260976438.14
B-2
SCHEDULE A
Item
No. Payee Amount Purpose
OHS WEST:260976438.14
C-1
EXHIBIT C
PROJECT DESCRIPTION
The East Bay Regional Communications System (EBRCS) is a P-25 compliant digital
communications system manufactured by Motorola providing interoperability for emergency
responders and others on the system in Alameda and Contra Costa counties. The system is a
Motorola Astro 25 SmartZone Project 25 700/800 MHz. system. The system consists of 36
repeater sites divided into 6 simulcast cells.
Cell Repeater Sites Channels Standalones Channels
ALCO
Northwest
4 16 1 4
ALCO
Southwest
7 12 1 5
ALCO East 4 10 1 4
CCCO West 4 10 1 5
CCCO Central 8 10
CCCO East 3 7 2 3-4
The EBRCS system specifications were developed by AECOM of Lynchburg Virginia. The
system Master site controller is located at the Alameda County Office of Emergency Services
and Homeland Security in Dublin. All of the repeater sites are connected back to the Master Site
through a looped digital microwave system. Each cell will have a prime site that will house
additional equipment to coordinate signal timing between itself and the other repeater sites
within the cell. Each repeater site is equipped with an emergency generator and a minimum of 2
hours of battery backup power, and meets Motorola’s R56 standards for grounding. The sites are
owned by multiple agencies within Alameda and Contra Costa counties, with the majority of the
sites owned by the two counties. The EBRCS Authority has entered into, or is in the process of
entering into, licensing agreements for use of the non county-owned sites. Each public safety
dispatch center has connectivity to the system through microwave. The EBRCS Authority will
provide dispatch consoles and/or console upgrades for each center. Currently there are 110
planned replacements and 39 upgrades to existing facilities.
OHS WEST:260976438.14
i
ARTICLE I DEFINITIONS; EQUAL SECURITY ............................................................ 2
SECTION 1.01 Definitions...................................................................................... 2
SECTION 1.02 Equal Security .............................................................................. 12
SECTION 1.03 Interpretation ................................................................................ 12
ARTICLE II THE BONDS ................................................................................................. 12
SECTION 2.01 Authorization of Bonds; Series 2011 Bonds ................................ 12
SECTION 2.02 Terms of the Bonds ...................................................................... 13
SECTION 2.03 Terms of the Series 2011 Bonds .................................................. 14
SECTION 2.04 Form of Bond ............................................................................... 17
SECTION 2.05 Execution of Bonds ...................................................................... 17
SECTION 2.06 Transfer and Payment of Bonds ................................................... 17
SECTION 2.07 Exchange of Bonds ...................................................................... 18
SECTION 2.08 Bond Registration Books ............................................................. 18
SECTION 2.09 Mutilated, Destroyed, Stolen or Lost Bonds; Temporary
Bonds ........................................................................................... 18
ARTICLE III ISSUANCE OF BONDS ............................................................................... 19
SECTION 3.01 Procedure for the Issuance of Bonds ........................................... 19
SECTION 3.02 Project Fund ................................................................................. 19
SECTION 3.03 Conditions for the Issuance of Additional Bonds ........................ 19
SECTION 3.04 Proceedings for Authorization of Additional Bonds ................... 20
SECTION 3.05 Limitations on the Issuance of Obligations Payable from
Pledged Revenues ........................................................................ 21
ARTICLE IV REDEMPTION OF BONDS ......................................................................... 21
SECTION 4.01 Extraordinary Redemption ........................................................... 21
SECTION 4.02 Optional Redemption ................................................................... 21
SECTION 4.03 Mandatory Sinking Fund Redemption ......................................... 21
SECTION 4.04 Selection of Bonds for Redemption ............................................. 21
SECTION 4.05 Notice of Redemption; Cancellation; Effect of Redemption ....... 21
ARTICLE V REVENUES ................................................................................................... 22
SECTION 5.01 Pledge of Pledged Revenues ........................................................ 22
SECTION 5.02 Receipt and Deposit of Revenues in the Revenue Fund .............. 23
SECTION 5.03 Establishment and Maintenance of Accounts for Use of
Money in the Bond Fund ............................................................. 24
OHS WEST:260976438.14
ii
SECTION 5.04 Reserve and Replacement Fund ................................................... 26
SECTION 5.05 Operation and Maintenance Fund ................................................ 26
SECTION 5.06 Application of Insurance Proceeds .............................................. 26
SECTION 5.07 Deposit and Investments of Money in Accounts and Funds ........ 26
ARTICLE VI COVENANTS OF THE AUTHORITY ........................................................ 27
SECTION 6.01 Punctual Payment and Performance ............................................ 27
SECTION 6.02 Against Encumbrances ................................................................. 27
SECTION 6.03 Tax Covenants; Rebate Fund ....................................................... 27
SECTION 6.04 Accounting Records and Reports ................................................. 28
SECTION 6.05 Prosecution and Defense of Suits ................................................ 29
SECTION 6.06 Further Assurances....................................................................... 29
SECTION 6.07 Maintenance of Revenues ............................................................ 29
ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BONDHOLDERS ........... 29
SECTION 7.01 Events of Default and Acceleration of Maturities ....................... 29
SECTION 7.02 Application of Funds Upon Acceleration .................................... 30
SECTION 7.03 Institution of Legal Proceedings by Trustee ................................ 31
SECTION 7.04 Non-Waiver .................................................................................. 31
SECTION 7.05 Actions by Trustee as Attorney-in-Fact ....................................... 32
SECTION 7.06 Remedies Not Exclusive .............................................................. 32
SECTION 7.07 Limitation on Bondholders’ Right to Sue .................................... 32
ARTICLE VIII THE TRUSTEE ............................................................................................. 32
SECTION 8.01 The Trustee .................................................................................. 32
SECTION 8.02 Liability of Trustee ...................................................................... 33
SECTION 8.03 Compensation and Indemnification of Trustee ............................ 35
ARTICLE IX AMENDMENT OF THE TRUST AGREEMENT ....................................... 36
SECTION 9.01 Amendment of the Trust Agreement ........................................... 36
SECTION 9.02 Disqualified Bonds....................................................................... 37
SECTION 9.03 Endorsement or Replacement of Bonds After Amendment ........ 37
SECTION 9.04 Amendment by Mutual Consent .................................................. 37
ARTICLE X DEFEASANCE.............................................................................................. 38
SECTION 10.01 Discharge of Bonds ...................................................................... 38
SECTION 10.02 Unclaimed Money ........................................................................ 39
ARTICLE XI MISCELLANEOUS ...................................................................................... 39
OHS WEST:260976438.14
iii
SECTION 11.01 Liability of Authority Limited to Pledged Revenues ................... 39
SECTION 11.02 Benefits of this Trust Agreement Limited to Parties and
Third Party Beneficiaries ............................................................. 39
SECTION 11.03 Successor Is Deemed Included In All References To
Predecessor .................................................................................. 40
SECTION 11.04 Execution of Documents by Bondholders ................................... 40
SECTION 11.05 Waiver of Personal Liability ........................................................ 40
SECTION 11.06 Destruction of Canceled Bonds .................................................. 40
SECTION 11.07 Content of Certificates ................................................................. 40
SECTION 11.08 Accounts and Funds ..................................................................... 41
SECTION 11.09 Business Day ................................................................................ 41
SECTION 11.10 Notices; Notices to Rating Agencies ........................................... 41
SECTION 11.11 Article and Section Headings and References ............................. 42
SECTION 11.12 Partial Invalidity........................................................................... 42
SECTION 11.13 Governing Law ............................................................................ 42
SECTION 11.14 Execution in Several Counterparts ............................................... 43
Execution ..................................................................................................................................... 43
Exhibit A Form of Bond ..................................................................................................... A-1
Exhibit B Form of Project Fund Requisition...................................................................... B-1
Exhibit C Description of Project ........................................................................................ C-1
OHS WEST:261110504.1
$2,455,113.76
EAST BAY REGIONAL
COMMUNICATIONS SYSTEM AUTHORITY
REVENUE BOND, 2011 SERIES B
FINANCING AGREEMENT
April __, 2011
East Bay Regional
Communications System Authority
Dublin, California
Ladies and Gentlemen:
The undersigned County of Contra Costa (the “County”) offers to enter into this
Financing Agreement (this “Financing Agreement”) with the East Bay Regional
Communications System Authority (the “Authority”). Upon acceptance of this offer, this
Financing Agreement shall be binding upon the Authority and the County. Capitalized terms not
otherwise defined herein shall have the respective meanings ascribed thereto in the Trust
Agreement (defined below).
1. Upon the terms and conditions and upon the basis of the representations,
warranties and covenants set forth herein, the County agrees to purchase from the Authority, and
the Authority agrees to sell to the County, all (but not less than all) of the $2,455,113.76
principal amount of the East Bay Regional Communications System Authority Revenue Bonds,
2011 Series B (the “2011 Series B Bonds” or the “Bonds”) at a purchase price equal to the
principal amount of the Bonds purchased. The acquisition of the Bonds shall be purchased with
monies legally available therefor.
2. The Bonds are authorized by Chapter 5 of Division 7 of Title 1 of the
Government Code of the State of California (the “Act”). The Bonds are further authorized by a
Resolution of the Authority, adopted by the Authority’s Board of Directors on October 15, 2010
(the “Resolution”). The Bonds shall be issued pursuant to Article 4 of the Act, the Resolution
and a Trust Agreement, dated as of October 1, 2010 (the “Trust Agreement”), between the
Authority and Deutsche Bank National Trust Company, as trustee (the “Trustee”). Capitalized
terms used herein and not otherwise defined herein, shall have the meanings ascribed thereto in
the Trust Agreement. The Bonds shall be secured by a pledge of Pledged Revenues.
3. The Bonds shall be dated the date of Closing (as defined in Section 6 hereof), and
shall be convertible capital appreciation bonds, shall convert to current interest bonds on June 1,
2013, with the first interest payment date of December 1, 2013, mature on the date and bear
interest at the rate, payable at the times, and shall be subject to redemption, all as set forth on
Exhibit A attached hereto.
OHS WEST:261110504.1
2
4. The County represents and warrants and covenants to the Authority as follows:
(a) The County has full power and authority to purchase the Bonds and to
enter into this Financing Agreement and any other instruments and documents required to
be executed by the County in connection with the purchase of the Bond. The County has
duly authorized the execution and delivery of, and the performance by the County of its
obligations contained in, this Financing Agreement. This Financing Agreement
(assuming due authorization, execution and delivery by and validity against the
Authority) constitutes and, as of the date of the Closing, will constitute, the valid and
binding agreement of the County enforceable in accordance with its terms, subject to the
effect of bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance,
moratorium and other similar laws relating to or affecting the creditors’ rights generally,
to the application of equitable principles, to the exercise of judicial discretion in
appropriate cases and to the limitations on legal remedies against Counties in the State of
California (the “State”).
(b) The County is entering into this Financing Agreement in accordance with
the Act to assist in the financing of the Project.
(c) To the knowledge of the County, there is no litigation pending (with
service of process against the County having been accomplished) or threatened against
the County: (1) seeking to restrain or enjoin the purchase by the County of the Bonds, or
(2) challenging any proceeding of the County taken with respect to the foregoing.
(d) All authorizations and approvals that are or will be necessary for the
purchase of the Bonds or for the valid execution, delivery or performance of this
Financing Agreement have been obtained.
(e) The execution, delivery and performance of this Financing Agreement
does not and will not conflict with, or result in a violation of, any provision of law, or any
order, writ, rule or regulation of any court or government agency or instrumentality
binding upon or applicable to the County and does not and will not in any material aspect
conflict with, result in a violation of, or constitute a default under, any agreement or
instrument, to which the County is a party or by which the County or any of its property
is bound, which would, in any such case, materially and adversely affect the County’s
ability to perform its obligations with respect to this Financing Agreement.
(f) In making its decision to purchase the Bonds, the County acknowledges
that it has either been supplied with or has had access to information to which a
reasonable investor would attach significance in making investment decisions, and it has
had the opportunity to ask questions and receive answers from knowledgeable individuals
concerning the Bonds and the security therefor, so that as a reasonable investor it has
been able to make its decision to purchase the Bonds.
(g) The County understands that the Bonds (i) are not being registered or
otherwise qualified for sale under the “Blue Sky” laws and regulations of any state,
(ii) will not be listed on any stock or other securities exchange, (iii) will carry no rating
OHS WEST:261110504.1
3
from any rating service, (iv) may not be sold, and (v) due to lack of a rating may not be
readily marketable. The County further understands that the Bonds have not been
registered under the Securities Act of 1933, as amended, and that such registration is not
legally required.
(h) The County is purchasing the Bonds for its own account and not with a
view toward or for sale in connection with any distribution thereof. The County has no
present intent to (i) dispose of all or any part of the Bonds, (ii) divide the Bonds into
participation interests or other units for sale, or (iii) deposit the Bonds into any fund or
trust of which participation interests can be sold to other parties. The County understands
that the Bonds are subject to resale restrictions and may not be marketable, so that the
County will be required to bear the risk of this investment for a certain period of time.
The County is able to bear the economic risk associated with this investment.
(i) The County understands that neither the Authority nor anyone else has
prepared or provided any offering statement, prospectus, offering circular, private
placement memorandum or other comprehensive offering statement containing material
information with respect to the Bonds or the Authority.
(j) At Closing, pursuant to the Trust Agreement, the Trustee shall establish
and hold in trust the following accounts:
(1) Bond Fund;
(2) Costs of Issuance Fund; and
(3) Project Fund.
(k) At Closing, the Authority shall deposit in the Costs of Issuance Fund an
amount necessary to pay the costs of issuance. All money in the Costs of Issuance Fund
shall be used to pay the Costs of Issuance of the Bonds and as indicated in Exhibit C
hereto.
(l) The Trustee shall establish and maintain the Project Fund so long as
proceeds remain therein. At Closing, Authority will cause the Trustee to deposit the
remaining amounts into the Project Fund. The moneys in the Project Fund shall be
disbursed by the Trustee upon the receipt by the Trustee of a Requisition of the Authority
in substantially the form attached to the Trust Agreement as Exhibit B for the payment of
costs relating to the financing and completion of the Project.
(m) The Bonds may be redeemed according to the redemption terms and
conditions set forth in the Trust Agreement.
5. The Authority represents and warrants and covenants to the County as follows:
(a) The Authority is duly organized and validly existing under the laws of the
State of California and has full power and authority to enter into this Financing
Agreement and the Trust Agreement and to issue and deliver the Bonds to the County as
OHS WEST:261110504.1
4
provided in this Financing Agreement and the Trust Agreement. The Authority has duly
authorized the execution and delivery of, and the performance by the Authority of its
obligations contained in, the Bonds, this Financing Agreement and the Trust Agreement.
This Financing Agreement (assuming due authorization, execution and delivery by and
validity against the County) constitutes and, as of the date of the Closing, this Financing
Agreement and the Trust Agreement (assuming due authorization, execution and delivery
by and validity against the other parties thereto) and the Bonds will constitute, the valid
and binding agreements of the Authority enforceable in accordance with their respective
terms, subject to the effect of bankruptcy, insolvency, reorganization, arrangement,
fraudulent conveyance, moratorium and other similar laws relating to or affecting the
creditors’ rights generally, to the application of equitable principles, to the exercise of
judicial discretion in appropriate cases and to the limitations on legal remedies against
governmental entities in the State.
(b) The Authority’s Board of Directors has full power and authority to adopt
its Resolution approving the Bonds, this Financing Agreement and the Trust Agreement.
The Resolution has been duly adopted by the Authority’s Board of Directors empowered
to do so at a regular meeting of the Board of Directors and has not been modified,
amended or repealed and is valid and binding and in full force and effect as of the date
hereof.
(c) The Authority duly authorized the execution and delivery of the Operating
Agreements, and will make its best efforts to execute and deliver future Operating
Agreements, and said executed agreements (assuming due authorization, execution and
delivery by and validity against the other parties thereto) constitute the valid and binding
agreements of the Authority, enforceable in accordance with their terms, subject to the
effect of bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance,
moratorium and other similar laws relating to or affecting the creditors’ rights generally,
to the application of equitable principles, to the exercise of judicial discretion in
appropriate cases and to the limitations on legal remedies against governmental entities in
the State. The Operating Agreements that have been executed remain in full force and
effect and have not been supplemented, modified or amended.
(d) To the knowledge of the Authority, there is no litigation pending (with
service of process against the Authority having been accomplished) or threatened against
the Authority: (1) seeking to restrain or enjoin the sale, issuance, execution or delivery of
the Bonds, or (2) challenging the validity of the Bonds, the Trust Agreement or the
Operating Agreements, or the pledge of the Revenues, or any proceeding of the Authority
taken with respect to the foregoing, or (3) challenging the organization or existence of the
Authority or the entitlement to their respective offices of any of the officers who caused
the Bonds to be executed and delivered on behalf of the Authority, or (4) challenging the
power or authority of the Authority to request and receive the Revenues pursuant to the
Operating Agreements.
(e) The Bonds, when issued and delivered in accordance with the Act, the
Resolution and the Trust Agreement and sold to the County as provided herein, will be
validly issued and outstanding obligations of the Authority enforceable in accordance
OHS WEST:261110504.1
5
with their terms and entitled to the benefits of the Act, the Resolution and the Trust
Agreement, subject to the effect of bankruptcy, insolvency, reorganization, arrangement,
fraudulent conveyance, moratorium and other similar laws relating to or affecting the
creditors’ rights generally, to the application of equitable principles, to the exercise of
judicial discretion in appropriate cases and to the limitations on legal remedies against
governmental entities in the State.
(f) All authorizations, approvals, licenses, permits, consents, filings,
registrations and orders of any court or governmental authority or agency having
jurisdiction of the matter that is or will be necessary for the issuance, sale, execution and
delivery of, and payment of the principal of and interest on, the Bonds, or for the valid
execution, delivery or performance of the Resolution, the Trust Agreement, the Operating
Agreements or this Financing Agreement have been obtained.
(g) The execution, issuance and delivery of, and the payment of principal of
and interest on, the Bonds and the execution, delivery and performance of the Resolution,
the Trust Agreement, the Operating Agreements and this Financing Agreement do not
and will not conflict with, or result in a violation of, any provision of law, including the
constitution of the State, or any order, writ, rule or regulation of any court or government
agency or instrumentality binding upon or applicable to the Authority and do not and will
not in any material aspect conflict with, result in a violation of, or constitute a default
under, any agreement or instrument, to which the Authority is a party or by which the
Authority or any of its property is bound, which would, in any such case, materially and
adversely affect the Authority’s ability to perform its obligations with respect to this
Financing Agreement, the Trust Agreement, the Resolution and the Bond.
(h) All written information provided by the Authority to the County
concerning the Authority, the Authority’s finances, and the Operating Agreements are
true and accurate in all material respects and does not include a false statement of a
material fact or omit any material fact necessary to make the statements therein, under the
circumstances in which they are made, not misleading.
6. At 9:00 a.m., California time, on April 21, 2011, subject to the terms and
conditions of this Financing Agreement, the Authority will deliver or cause to be delivered to the
County or its custodian at the office of Orrick, Herrington & Sutcliffe LLP in San Francisco,
California, or such other place as may be mutually agreed upon, the Bonds and the documents
required to be delivered pursuant to this Financing Agreement, and, the County will accept
delivery of the Bonds and such documents and pay the purchase price of the Bonds in
immediately available funds to the Trustee and the Authority will cause deposit of funds as set
forth in the Trust Agreement (such payment and delivery of documents are herein called the
“Closing”).
7. The County has entered into this Financing Agreement in reliance upon the
representations, warranties and covenants of the Authority contained herein and the performance
by the County of its obligations hereunder are and shall be subject to the following further
conditions:
OHS WEST:261110504.1
6
(a) At or prior to the Closing, the County and the Authority shall have
received each of the following documents:
(1) An opinion of Orrick, Herrington & Sutcliffe LLP (“Orrick”) as
Bond Counsel, dated the date of Closing, addressed to the Authority.
(2) Certified copies of the Resolution;
(3) Executed copies of the Trust Agreement ;
(4) Evidence of required filings with the California Debt and
Investment Advisory Commission; and
(5) A list of the executed Operating Agreements.
(6) Evidence of insurance obtained by the Authority.
(7) Any other documents, opinions and/or certifications, in form and
substance reasonably requested by and acceptable to the County and its counsel.
The opinions, certificates and other materials referred to above shall be in form and
substance satisfactory to the County and its counsel.
8. The Authority shall pay or cause to be paid all other expenses incident to the
issuance and sale of the Bond as herein provided, including but not limited to: (a) the cost of the
preparation and printing or other reproduction and distribution of the Resolution, the documents
and the Bonds, (b) the fees and disbursements of its Counsel, (c) the fees of any financial advisor
for the Authority, (d) the fee of the California Debt and Investment Advisory Commission, and
(e) the fees and disbursements of any other experts or consultants retained by the Authority in
connection with the transaction contemplated hereby. The County shall pay any other expenses
incurred by it.
9. Any notice or other communication to be given to the Authority under this
Financing Agreement may be given by delivering the notice or communication in writing
(including by fax) to the East Bay Regional Communications System Authority, 4985 Broder
Boulevard, Dublin California 94568, Attention: William J. McCammon (fax: 925-803-7878);
any notice or other communication to be given to the County under this Financing Agreement
may be given by delivering the notice or communication in writing to Contra Costa County,
Office of the County Administrator, 651 Pine Street, 10th Floor, Martinez, CA 94553 (fax: 925-
646-1353).
10. This Financing Agreement shall constitute the entire agreement between the
County and the Authority with respect to its subject matter and is made solely for the benefit of
the Authority and the County (including any successors of the County). No other person shall
acquire or have any right hereunder or by virtue hereof. All of the representations, warranties
and agreements of the Authority and the County in this Financing Agreement shall remain
operative and in full force and effect regardless of: (a) any investigation made by or on behalf of
OHS WEST:261110504.1
7
the County or the Authority; (b) delivery of payment for the Bonds hereunder; and (c) any
termination of this Financing Agreement.
11. This Financing Agreement may be executed in several counterparts, each of
which shall be regarded as an original and all of which shall constitute one and the same
document.
12. This Financing Agreement shall be governed by and interpreted under the laws of
the State. This Financing Agreement shall be enforceable in the State and any action arising out
of to this Financing Agreement shall be brought in the courts of the State located in the County
of Contra Costa or the County of Alameda, California and, by execution and delivery of this
Financing Agreement, the parties hereto consent and hereby accept for themselves and in respect
of their property, generally and unconditionally, the jurisdiction of the aforesaid courts. To the
extent permitted by law, the parties hereto hereby irrevocably waive any objection, including,
without limitation, any objection to the laying of venue or based on the grounds of forum non
conveniens, which they may now have or hereafter have to the bringing of any such action or
proceeding in such jurisdictions.
OHS WEST:261110504.1
S-1
IN WITNESS WHEREOF, the County has executed and delivered this Financing
Agreement as of the date first written above.
Very truly yours,
COUNTY OF CONTRA COSTA, as purchaser
By:
Title: County Administrator
Accepted:
EAST BAY REGIONAL
COMMUNICATIONS SYSTEM
AUTHORITY
By:
Executive Director
OHS WEST:261110504.1
A-1
EXHIBIT A
MATURITY, PRINCIPAL AMOUNT, INTEREST RATES
MATURITY
DATE
PRINCIPAL
AMOUNT
ACCRUED
VALUE AT
CONVERSION
DATE
INTEREST
RATE
June 1, 2027 $2,455,113.76 $2,672,000 4.05%
Interest Payment Dates: June 1 and December 1, commencing December 1, 2013 and on
maturity or earlier redemption.
Mandatory Redemption pursuant to Mandatory Sinking Account Schedule in the Trust
Agreement
Optional Redemption: prepayable at any time.
OHS WEST:261110504.1
D-1
EXHIBIT B
COSTS OF ISSUANCE
The following amounts shall be paid from the Costs of Issuance Fund at Closing:
Payee Amount
Orrick, Herrington & Sutcliffe (Bond Counsel) $58,500
KNN (Financial Advisor 76,000
Deutsche Bank (Trustee) 1,500