HomeMy WebLinkAboutMINUTES - 02062001 - SD.4 BOARD OF SUPERVISORS OF THE COUNTY OF CONTRA COSTA
RESOLUTION NO. 2001 149
RESOLUTION AUTHORIZING THE ISSUANCE OF
COUNTY OF CONTRA COSTA TAXABLE PENSION
OBLIGATION BONDS, REFUNDING SERIES 20015
APPROVING THE FORM OF AND AUTHORIZING THE
EXECUTION AND DELIVERY OF A FIRST
SUPPLEMENTAL TRUST AGREEMENT, A BOND
PURCHASE CONTRACT, AN ESCROW AGREEMENT, A
REMARKETING AGREEMENT, A STANDBY BOND
PURCHASE AGREEMENT, A DEALER MANAGER
AGREEMENT AND APPROVING AN OFFICIAL
STATEMENT FOR SAID BONDS AND AUTHORIZING A
TENDER OFFER OF THE COUNTY'S TAXABLE
PENSION OBLIGATION BONDS, 1994 SERIES A AND
OTHER ACTIONS RELATING THERETO
WHEREAS, the COUNTY OF CONTRA COSTA-(the"County") adopted a retirement
plan under the County Employees Retirement Law of 1937, being Division 4 of Title 3 of the
Government Code of the State of California, Sections 31450 through 31898, inclusive, as
amended (the "Retirement Law"); and
WHEREAS, the Retirement Law obligates the County to (1)make annual contributions
to the Contra Costa County Employees.Retirement Association(the "Association"), to fund
pension benefits for its employees, (2) amortize the unfunded accrued actuarial liability with
respect to such pension benefits over a period not exceeding 30 years, and (3) appropriate funds
for the purposes described in(1) and(2); and
WHEREAS, the County in 1994 evidenced its obligations to the Association to pay the
then-current unfunded accrued actuarial liability("UAAL") of the County,by issuing a
debenture (the "1994 Debenture") to the Association and authorized the issuance of additional
debentures in the future from time to time; and
WHEREAS, the County issued its Taxable Pension Obligations, 1994 Series A (the
1994 Series A Bonds") in an aggregate principal amount of$337,365,000 for the purpose of
refunding the 1994 Debenture, thereby providing a lower interest rate on the County's
outstanding obligations than charged to the County's then-current UAAL, and authorized the
issuance of additional bonds in the future from time to time; and
WHEREAS, the County has determined it is in its best interest to refund a portion of the
1994 Series A Bonds by the issuance of refunding bonds(the"Bonds") on a parity with the 1994
Series A Bonds; and
DOCSSFI:468618.4
WHEREAS, the 1994 Series A Bonds are not subject to optional redemption so the
County has determined to extend a tender offer to the owners of the 1994 Series A Bonds and to
defease a portion of the 1994 Series A Bonds if insufficient tenders are received; and.
WHEREAS, there are on file with the Clerk of the Board of Supervisors the proposed
forms of the following documents:
(i) a First Supplemental Trust Agreement (the"Supplemental Trust
Agreement") to be entered into between the County and BNY Western Trust Company,
successor to First Interstate Bank of California, as trustee (the "Trustee"), which
Supplemental Trust Agreement supplements and amends the Trust Agreement, dated as
of February 1, 1994 (collectively, the"Trust Agreement"), under which the 1994
Series A Bonds were issued;
(ii) a Remarketing Agreement (the"Remarketing Agreement") to be
entered into between the County and Bear, Stearns & Co. Inc., as remarketing agent;
(iii) an Escrow Agreement to be entered into between the County and
the Trustee;
(iv) a Preliminary Official Statement;
(v) a Bond Purchase Contract to be entered into between the County
and Bear, Stearns & Co. Inc. (the "Underwriter");
(vi) a Standby Bond Purchase Agreement to be entered into between
the County and Westdeutsche Landesbank Girozentrale, acting through its New York
Branch.
(vii) a Dealer Manager Agreement to be entered into between the
County and Bear, Stearns & Co. Inc.; and
(viii) an Invitation to Tender Bonds;
NOW, THEREFORE, IT IS RESOLVED, DETERMINED AND ORDERED by the
Board of Supervisors of the County of Contra Costa(the"Board"), as follows:
Section 1. All of the above recitals are true and correct and the Board hereby so finds
and determines:
Section 2. The Board hereby authorizes and approves the issuance of the Bonds and
hereby authorizes and directs the Chair of the Board and the Treasurer-Tax Collector to execute
the Bonds, and the Clerk of the Board to affix and attest the seal of the County and to cause the
Bonds to be authenticated and delivered in accordance with the Trust Agreement. The Bonds
shall be in substantially the form set forth in Exhibit A to the Supplemental Trust Agreement,
with such changes therein, deletions therefrom and additions thereto as the Chair of the Board
and the Treasurer-Tax Collector shall approve, such approval to be conclusively evidenced by
the execution and delivery of the Bonds; the Bonds may be issued in a single series or in two or
DOCSSF1:468618.4 2
more series and as fixed or variable rate Bonds, provided, however, that the aggregate principal
amount of the Bonds shall not exceed $125,000,000, the Bonds shall bear interest at a fixed or
variable rate, not to exceed the Maximum Rate(as defined in the Supplemental Trust
Agreement), the Bonds shall be dated their date of issuance or such other date specified in the
Supplemental Trust Agreement and the Bonds shall mature not later than June 1, 2014. The
Bonds shall constitute an obligation imposed by law, pursuant to the Constitution of the State of
California and the Retirement Law and an obligation of the County not limited as to payment
from any special source of funds. The Bonds shall not, however, constitute an obligation of the
County for which the County is obligated or permitted to levy or pledge any form of taxation or
for which the County has levied or pledged or will levy or pledge any form of taxation.
Section 3. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Supplemental Trust Agreement between the County and the Trustee, on file
with the Clerk of the Board. The Chair of the Board is hereby authorized and directed to execute
and deliver the Supplemental Trust Agreement on behalf of the County, substantially in the form
on file with the Clerk of the Board, with such changes therein, deletions therefrom and additions
thereto as the Chair shall approve, such approval to be conclusively evidenced by the execution
and delivery of the Supplemental Trust Agreement, and the Clerk of the Board is authorized and
directed to affix and attest the seal of the County thereto.
Section 4. The Board hereby authorizes and approves the Preliminary Official Statement,
relating to the Bonds, on file with the Clerk of the Board, and approves the distribution of the
Preliminary Official Statement by the Underwriter to potential purchasers of the Bonds. The
County Administrator or his designee is hereby authorized and directed to execute the final
Official Statement with such changes therein, deletions therefrom and additions thereto as the
County Administrator or his designee shall approve, such approval to be conclusively evidenced
by the execution and delivery of the final Official Statement. Distribution of the final Official
Statement by the Underwriters to actual purchasers of Bonds is hereby authorized and approved.
Section 5. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Bond Purchase Contract, to be dated the date of sale of the Bonds (the
"Purchase Contract"), between the County and the Underwriter, on file with the Clerk of the
Board. The County Administrator or his designee is hereby authorized and directed to execute
and deliver the Bond Purchase Contract, substantially in the form on file with the Clerk of the
Board, with such changes therein, deletions therefrom and additions thereto as the County
Administrator or his designee shall approve, such approval to be conclusively evidenced by the
execution and delivery of the Bond Purchase Contract; provided that the underwriters' discount
on the Bonds (exclusive of any original issue.discount) shall not exceed two percent (2%) of the
principal amount of the Bonds.
Section 6. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Remarketing Agreement,between the County and Bear, Stearns & Co. Inc., as
remarketing agent for the Bonds, on file with the Clerk of the Board. If the Bonds are issued as
variable rate Bonds, the County Administrator or his designee is hereby authorized and directed
to execute and deliver the Remarketing Agreement on behalf of the County, substantially in the
form on file with the Clerk of the Board,with such changes therein, deletions therefrom and
DOCSSF1:468618.4 3
additions thereto as the County Administrator or his designee shall approve, such approval to be
conclusively evidenced by the execution and delivery of the Remarketing Agreement.
Section 7. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Dealer Manager Agreement, between the County and Bear, Stearns & Co. Inc.,
as dealer manager of the tender offer for the 1994 Series A Bonds, on file with the Clerk of the
Board. The County Administrator or his designee is hereby authorized and directed to execute
and deliver the Dealer Manager Agreement on behalf of the County, substantially in the form on
file with the Clerk of the Board, with such changes therein, deletions therefrom and additions
thereto as the County Administrator or his designee shall approve, such approval to be
conclusively evidenced by the execution and delivery of the Dealer Manager Agreement.
Section 8. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Standby Bond Purchase Agreement,between the County and Westdeutsche
Landesbank Girozentrale, in order to provide liquidity for the Bonds, on file with the Clerk of the
Board. If the Bonds are issued as variable rate Bonds, the County Administrator or his designee
is hereby authorized and directed to execute and deliver the Standby Bond Purchase Agreement
on behalf of the County, substantially in the form on file with the Clerk of the Board, with such
changes therein, deletions therefrom and additions thereto as the County Administrator or his
designee shall approve, such approval to be conclusively evidenced by the execution and
delivery of the Standby Bond Purchase Agreement.
Section 9. The Board hereby authorizes and approves the execution and delivery of the
proposed form of an Invitation to Tender Bonds on file with the Clerk of the Board. The County
Administrator or his designee is hereby authorized and directed to execute and deliver the
Invitation to Tender Bonds on behalf of the County, substantially in the form on file with the
Clerk of the Board, with such changes therein, deletions therefrom and additions thereto as the
County Administrator or his designee shall approve, such approval to be conclusively evidenced
by the execution and delivery of the Invitation to Tender Bonds. Such officers are hereby further
authorized to take such actions and execute such contracts and certificates as are necessary to
extend the Invitation to Tender as contemplated therein, including, but not limited to, contracts
with Bondholder Communications Group, as information agent for such tender.
Section 10. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Escrow Agreement, between the County and the Trustee, on file with the Clerk
of the Board. In the event the County Administrator determines that portions of the 1994
Series A Bonds need to be defeased to accommodate the restructuring of the County's debt in
connection with or in lieu of the tender, the County Administrator or his designee is hereby
authorized and directed to execute and deliver the Escrow Agreement on behalf of the County,
substantially in the form on file with the Clerk of the Board,with such changes therein, deletions
therefrom and additions thereto as the County Administrator or his designee shall approve, such
approval to be conclusively evidenced by the execution and delivery of the Escrow Agreement
and in connection thereafter to execute or authorize the Trustee to execute escrow float
agreements and purchase securities for such escrow (the "Escrow Investments").
Section 11. The County Administrator or his designee is hereby authorized to execute
and deliver on behalf of the County an interest rate swap agreement and/or a hedging agreement
DOCSSF1:46861 R.4 4
and/or any other form of derivative agreement or arrangement with an institutional party;
provided, however, that the institutional party or its guarantor shall have a long-term credit rating
by at least one national credit agency equal to AA, the term of the swap agreement, derivative
agreement or hedging agreement shall not exceed the term of the Bonds, the County's
obligations shall be contingent upon certain performance by the counterparty to the agreement or
arrangement and that the County will have the right to terminate the agreement or arrangement
upon the occurrence of certain circumstances. The Board hereby finds and determines that such
agreements or arrangements will result in a lower cost of borrowing to the County.
Section 12. The Board hereby authorizes the County Administrator or his designee to
enter into one or more investment agreements on behalf of the County providing for the
investment of moneys in the funds and accounts created under the.Trust Agreement, as the
County Administrator or his designee deems appropriate, including the amendment, termination
or revision of the Debt Service Forward Delivery Agreement among the County, the Trustee and
Credit Suisse Financial Products, dated as of March 1, 1994 (collectively, the "Investment
Agreement"). The Board hereby finds and determines pursuant to Government Code section
5922, that the Investment Agreement and Escrow Investments will reduce the amount and
duration of interest rate risk with respect to amounts invested pursuant to such agreements. The
County Administrator or his designee is hereby authorized and directed to execute and deliver
the Investment Agreement and any other related agreement or agreements on behalf of the
County as may be approved by the County Administrator or his designee, such approval to be
conclusively evidenced by the execution and delivery of such agreement or agreements. Any
termination amounts required to be paid by the County with respect to the Investment Agreement
shall be paid from proceeds of the Bonds or amounts invested pursuant thereto. Any termination
amounts or up front payments received with respect to the Investment Agreement will be applied
as provided in the Trust Agreement.
Section 13. The supervisors, officers and employees of the County are hereby authorized
and directed,jointly and severally, to do any and all things which they may deem necessary or
advisable in order to consummate the transactions herein authorized and otherwise to carry out,
give effect to and comply with the terms and intent of this Resolution. The Chair of the Board of
Supervisors, the Clerk of the Board, the County Administrator and the Director, Capital Facilities
and Debt Management, in her official capacity and as designee of the County Administrator(the
"Director"), and the other officers and employees of the County are hereby authorized and
directed to execute and deliver any and all documents, certificates and representations, including,
but not limited to, signature certificates, no-litigation certificates and certificates concerning the
official statement describing the Bonds, necessary or desirable to accomplish the transactions set
forth above. If either the Chair of the Board or the Clerk of the Board and County Administrator
is unavailable at the time the documents authorized herein are to be executed and attested, such
documents may be executed by the'Vice-Chair of the Board, a Deputy Clerk or the Director,
respectively, with the same effect as if executed by the Chair of the Board or the Clerk of the
Board and the County Administrator.
Section 14. All actions heretofore taken by the supervisors, officers and agents of the
County with respect to the execution and delivery of the Bonds and the other transactions
authorized and contemplated herein are hereby approved, confirmed and ratified.
1)OCSSF1:468618.4 5
I
CLERK'S CERTIFICATE
Deputy Clerk of the Board of Supervisors of the County of
Contra Costa(the"County"),hereby certify as follows:
The foregoing is a full, true and correct copy of a resolution duly adopted at a regular
meeting of the Board of Supervisors of said County duly and regularly held at the regular
meeting place thereof on the day of , 2001, of which meeting all of the
members of said Board of Supervisors had due notice and at which a majority thereof was
present; and at said meeting said resolution was adopted by the following vote:
AYES:
NOES:
ABSTENTIONS:
An agenda of said meeting was posted at least 96 hours before said meeting in Martinez,
California, at a location freely accessible to members of the public, and a brief general
description of said resolution appeared on said agenda.
I have carefully compared the same with the original minutes of said meeting on file and
of record in my office; the foregoing resolution is a full, true and correct copy of the original
resolution adopted at said meeting and entered in said minutes; and said resolution has not been
amended, modified or rescinded since the date of its adoption, and the same is now in full force
and effect.
WITNESS my hand and the seal of the County of Contra Costa this day of
12001.
Deputy Clerk
of the Board of Supervisors
of the County of Contra Costa,
State of California
[Seal]
DOCSSF1:468618.4 7
Section 15. This Resolution shall take effect from and after its date of adoption.
PASSED AND ADOPTED this 6th day of February , 2001 by the
following vote:
AYES: SUPERVISORS GIOIA, GERBER, DESAULNIER, GLOVER and UILKEMA
NOES: NONE
ABSENT: NONE
ABSTAIN: NONE
Chair oft oard of Supervisors,
County of Contra Costa, California
A 1.TES ;.Philip J. Batchelor, Clerk
'of the Board of Supervisors
and County Administrator
By
Deputy Clerk of the Board of
Supervisors of the County of
Contra Costa, State of California
DOCSSF1-468618.4 6
Resolution 2001/49
CLERK'S CERTIFICATE
I, June L. McHuen , Deputy Clerk of the Board of Supervisors of the County of
Contra Costa(the"County"), hereby certify as follows:
The foregoing is a full, true and correct copy of a resolution duly adopted at a regular
meeting of the Board of Supervisors of said County duly and regularly held at the regular
meeting place thereof on the 6th day of February , 2001, of which meeting all of the
members of said Board of Supervisors had due notice and at which a majority thereof was
present; and at said meeting said resolution was adopted by the following vote:
AYES: SUPERVISORS GIOIA, GERBER, DESAULNIER, GLOVER and.'.:UILKEMA
NOES: NONE
ABSTENTIONS: NONE
An agenda of said meeting was posted at least 96 hours before said meeting in Martinez,
California, at a location freely accessible to members of the public, and a brief general
description of said resolution appeared on said agenda.
I have carefully compared the same with the original minutes of said meeting on file and
of record in my office; the foregoing resolution is a full, true and correct copy of the original
resolution adopted at said meeting and entered in said minutes; and said resolution has not been
amended, modified or rescinded since the date of its adoption, and the same is now in full force
and effect.
WITNESS my hand and the seal of the County of Contra Costa this 6th day of
FPh� r„aT, 2001.
_Deputy Clerk
of the Board of Supervisors
of the County of Contra Costa,
State of California
[Seal]
DOCSSF1:468618.4 7
RESOLUTION NO. 2001/49
BOARD OF SUPERVISORS OF THE COUNTY OF CONTRA COSTA
RESOLUTION NO. 20011/49
RESOLUTION AUTHORIZING THE ISSUANCE OF
COUNTY OF CONTRA COSTA TAXABLE PENSION
OBLIGATION BONDS, REFUNDING SERIES 2001,
APPROVING THE FORM OF AND AUTHORIZING THE
EXECUTION AND DELIVERY OF A FIRST
SUPPLEMENTAL TRUST AGREEMENT, A BOND
PURCHASE CONTRACT, AN ESCROW AGREEMENT, A
REMARKETING AGREEMENT, A STANDBY BOND
PURCHASE AGREEMENT, A DEALER MANAGER
AGREEMENT AND APPROVING AN OFFICIAL
STATEMENT FOR SAID BONDS AND AUTHORIZING A
TENDER OFFER OF THE COUNTY'S TAXABLE
PENSION OBLIGATION BONDS, 1994 SERIES A AND
OTHER ACTIONS RELATING THERETO
WHEREAS, the COUNTY OF CONTRA COSTA (the "County") adopted a retirement
plan under the County Employees Retirement Law of 1937, being Division 4 of Title 3 of the
Government Code of the State of California, Sections 31450 through 31898, inclusive, as
amended (the "Retirement Law"); and
WHEREAS, the Retirement Law obligates the County to (1)make annual contributions
to the Contra Costa County Employees Retirement Association(the"Association"), to fund
pension benefits for its employees, (2) amortize the unfunded accrued actuarial liability with
respect to such pension benefits over a period not exceeding 30 years, and (3) appropriate funds
for the purposes described in (1) and (2); and
WHEREAS, the County in 1994 evidenced its obligations to the Association to pay the
then-current unfunded accrued actuarial liability("UAAL") of the County, by issuing a
debenture (the"1994 Debenture") to the Association and authorized the issuance of additional
debentures in the future from time to time; and
WHEREAS, the County issued its Taxable Pension Obligations, 1994 Series A (the
"1994 Series A Bonds") in an aggregate principal amount of$337,365,000 for the purpose of
refunding the 1994 Debenture, thereby providing a lower interest rate on the County's
outstanding obligations than charged to the County's then-current UAAL, and authorized the
issuance of additional bonds in the future from time to time; and
WHEREAS, the County has determined it is in its best interest to refund a portion of the
1994 Series A Bonds by the issuance of refunding bonds (the"Bonds") on a parity with the 1994
Series A Bonds; and
DOCSSF1:468618.4
WHEREAS, the 1994 Series A Bonds are not subject to optional redemption so the
County has determined to extend a tender offer to the owners of the 1994 Series A Bonds and to
defease a portion of the 1994 Series A Bonds if insufficient tenders are received; and.
WHEREAS, there are on file with the Clerk of the Board of Supervisors the proposed
forms of the following documents:
(i) a First Supplemental Trust Agreement(the "Supplemental Trust
Agreement") to be entered into between the County and BNY Western Trust Company,
successor to First Interstate Bank of California, as trustee (the"Trustee"), which
Supplemental Trust Agreement supplements and amends the Trust Agreement, dated as
of February 1, 1994 (collectively, the "Trust Agreement"), under which the 1994
Series A Bonds were issued;
(ii) a Remarketing Agreement (the"Remarketing Agreement") to be
entered into between the County and Bear, Stearns & Co. Inc., as remarketing agent;
(iii) an Escrow Agreement to be entered into between the County and
the Trustee;
(iv) a Preliminary Official Statement;
(v) a Bond Purchase Contract to be entered into between the County
and Bear, Stearns & Co. Inc. (the "Underwriter");
(vi) a Standby Bond Purchase Agreement to be entered into between
the County and Westdeutsche Landesbank Girozentrale, acting through its New York
Branch.
(vii) a Dealer Manager Agreement to be entered into between the
County and Bear, Stearns & Co. Inc.; and
(viii) an Invitation to Tender Bonds;
NOW, THEREFORE, IT IS RESOLVED, DETERMINED AND ORDERED by the
Board of Supervisors of the County of Contra Costa(the "Board"), as follows:
Section 1. All of the above recitals are true and correct and the Board hereby so finds
and determines:
Section 2. The Board hereby authorizes and approves the issuance of the Bonds and
hereby authorizes and directs the Chair of the Board and the Treasurer-Tax Collector to execute
the Bonds, and the Clerk of the Board to affix and attest the seal of the County and to cause the
Bonds to be authenticated and delivered in accordance with the Trust Agreement. The Bonds
shall be in substantially the form set forth in Exhibit A to the Supplemental Trust Agreement,
with such changes therein, deletions therefrom and additions thereto as the Chair of the Board
and the Treasurer-Tax Collector shall approve, such approval to be conclusively evidenced by
the execution and delivery of the Bonds; the Bonds may be issued in a single series or in two or
DOC:SSF1.468618.4 2
more series and as fixed or variable rate Bonds, provided, however, that the aggregate principal
amount of the Bonds shall not exceed $125,000,000, the Bonds shall bear interest at a fixed or
variable rate, not to exceed the Maximum Rate (as defined in the Supplemental Trust
Agreement), the Bonds shall be dated their date of issuance or such other date specified in the
Supplemental Trust Agreement and the Bonds shall mature not later than June 1, 2014. The
Bonds shall constitute an obligation imposed by law, pursuant to the Constitution of the State of
California and the Retirement Law and an obligation of the County not limited as to payment
from any special source of funds. The Bonds shall not, however, constitute an obligation of the
County for which the County is obligated or permitted to levy or pledge any form of taxation or
for which the County has levied or pledged or will levy or pledge any form of taxation.
Section 3. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Supplemental Trust Agreement between the County and the Trustee, on file
with the Clerk of the Board. The Chair of the Board is hereby authorized and directed to execute
and deliver the Supplemental Trust Agreement on behalf of the County, substantially in the form
on file with the Clerk of the Board, with such changes therein, deletions therefrom and additions
thereto as the Chair shall approve, such approval to be conclusively evidenced by the execution
and delivery of the Supplemental Trust Agreement, and the Clerk of the Board is authorized and
directed to affix and attest the seal of the County thereto.
Section 4. The Board hereby authorizes and approves the Preliminary Official Statement,
relating to the Bonds, on file with the Clerk of the Board, and approves the distribution of the
Preliminary Official Statement by the Underwriter to potential purchasers of the Bonds. The
County Administrator or his designee is hereby authorized and directed to execute the final
Official Statement with such changes therein, deletions therefrom and additions thereto as the
County Administrator or his designee shall approve, such approval to be conclusively evidenced
by the execution and delivery of the final Official Statement. Distribution of the final Official
Statement by the Underwriters to actual purchasers of Bonds is hereby authorized and approved.
Section 5. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Bond Purchase Contract, to be dated the date of sale of the Bonds (the
"Purchase Contract"), between the County and the Underwriter, on file with the Clerk of the
Board. The County Administrator or his designee is hereby authorized and directed to execute
and deliver the Bond Purchase Contract; substantially in the form on file with the Clerk of the
Board, with such changes therein, deletions therefrom and additions thereto as the County
Administrator or his designee shall approve, such approval to be conclusively evidenced by the
execution and delivery of the Bond Purchase Contract; provided that the underwriters' discount
on the Bonds (exclusive of any original issue discount) shall not exceed two percent(2%) of the
principal amount of the Bonds.
Section 6. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Remarketing Agreement, between the County and Bear, Stearns & Co. Inc., as
remarketing agent for the Bonds, on file with the Clerk of the Board. If the Bonds are issued as
variable rate Bonds, the County Administrator or his designee is hereby authorized and directed
to execute and deliver the Remarketing Agreement on behalf of the County, substantially in the
form on file with the Clerk of the Board,with such changes therein, deletions therefrom and
UOCSSF1:468618.4 3
additions thereto as the County Administrator or his designee shall approve, such approval to be
conclusively evidenced by the execution and delivery of the Remarketing Agreement.
Section 7. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Dealer Manager Agreement,between the County and Bear, Stearns & Co. Inc.,
as dealer manager of the tender offer for the 1994 Series A Bonds, on file with the Clerk of the
Board. The County Administrator or his designee is hereby authorized and directed to execute
and deliver the Dealer Manager Agreement on behalf of the County, substantially in the form on
file with the Clerk of the Board, with such changes therein, deletions therefrom and additions
thereto as the County Administrator or his designee shall approve, such approval to be
conclusively evidenced by the execution and delivery of the Dealer Manager Agreement.
. Section 8. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Standby Bond Purchase Agreement, between the County and Westdeutsche
Landesbank Girozentrale, in order to provide liquidity for the Bonds, on file with the Clerk of the
Board. If the Bonds are issued as variable rate Bonds, the County Administrator or his designee
is hereby authorized and directed to execute and deliver the Standby Bond Purchase Agreement
on behalf of the County, substantially in the form on file with the Clerk of the Board, with such
changes therein, deletions therefrom and additions thereto as the County Administrator or his
designee shall approve, such approval to be conclusively evidenced by the execution and
delivery of the Standby Bond Purchase Agreement.
Section 9. The Board hereby authorizes and approves the execution and delivery of the
proposed form of an Invitation to Tender Bonds on file with the Clerk of the Board. The County
Administrator or his designee is hereby authorized and directed to execute and deliver the
Invitation to Tender Bonds on behalf of the County, substantially in the form on file with the
Clerk of the Board, with such changes therein, deletions therefrom and additions thereto as the
County Administrator or his designee shall approve, such approval to be conclusively evidenced
by the execution and delivery of the Invitation to Tender Bonds. Such officers are hereby further
authorized to take such actions and execute such contracts and certificates as are necessary to
extend the Invitation to Tender as contemplated therein, including, but not limited to, contracts
with Bondholder Communications Group, as information agent for such tender.
Section 10. The Board hereby authorizes and approves the execution and delivery of the
proposed form of Escrow Agreement,between the County and the Trustee, on file with the Clerk
of the Board. In the event the County Administrator determines that portions of the 1994
Series A Bonds need to be defeased to accommodate the restructuring of the County's debt in
connection with or in lieu of the tender, the County Administrator or his designee is hereby
authorized and directed to execute and deliver the Escrow Agreement on behalf of the County,
substantially in the form on file with the Clerk of the Board, with such changes therein, deletions
therefrom and additions thereto as the County Administrator or his designee shall approve, such
approval to be conclusively evidenced by the execution and delivery of the Escrow Agreement
and in connection thereafter to execute or authorize the Trustee to execute escrow float
agreements and purchase securities for such escrow(the"Escrow Investments").
Section 11. The County Administrator or his designee is hereby authorized to execute
and deliver on behalf of the County an interest rate swap agreement and/or a hedging agreement
UOCSSF1:468618.4 4
and/or any other form of derivative agreement or arrangement with an institutional party;
provided, however, that the institutional party or its guarantor shall have a long-term credit rating
by at least one national credit agency equal to AA, the term of the swap agreement, derivative
agreement or hedging agreement shall not exceed the term of the Bonds, the County's
obligations shall be contingent upon certain performance by the counterparty to the agreement or
arrangement and that the County will have the right to terminate the agreement or arrangement
upon the occurrence of certain circumstances. The Board hereby finds and determines that such
agreements or arrangements will result in a lower cost of borrowing to the County.
Section 12. The Board hereby authorizes the County Administrator or his designee to
enter into one or more investment agreements on behalf of the County providing for the
investment of moneys in the funds and accounts created under the Trust Agreement, as the
County Administrator or his designee deems appropriate, including the amendment, termination
or revision of the Debt Service Forward Delivery Agreement among the County, the Trustee and
Credit Suisse Financial Products, dated as of March 1, 1994 (collectively, the"Investment
Agreement"). The Board hereby finds and determines pursuant to Government Code section
5922, that the Investment Agreement and Escrow Investments will reduce the amount and
duration of interest rate risk with respect to amounts invested pursuant to such agreements. The
County Administrator or his designee is hereby authorized and directed to execute and deliver
the Investment Agreement and any other related agreement or agreements on behalf of the
County as may be approved by the County Administrator or his designee, such approval to be
conclusively evidenced by the execution and delivery of such agreement or agreements. Any
termination amounts required to be paid by the County with respect to the Investment Agreement
shall be paid from proceeds of the Bonds or amounts invested pursuant thereto. Any termination
amounts or up front payments received with respect to the Investment Agreement will be applied
as provided in the Trust Agreement.
Section 13. The supervisors, officers and employees of the County are hereby authorized
and directed,jointly and severally, to do any and all things which they may deem necessary or
advisable in order to consummate the transactions herein authorized and otherwise to carry out,
give effect to and comply with the terms and intent of this Resolution. The Chair of the Board of
Supervisors, the Clerk of the Board, the County Administrator and the Director, Capital Facilities
and Debt Management, in her official capacity and as designee of the County Administrator(the
"Director"), and the other officers and employees of the County are hereby authorized and
directed to execute and deliver any and all documents, certificates and representations, including,
but not limited to, signature certificates, no-litigation certificates and certificates concerning the
official statement describing the Bonds, necessary or desirable to accomplish the transactions set
forth above. If either the Chair of the Board or the Clerk of the Board and County Administrator
is unavailable at the time the documents authorized herein are to be executed and attested, such
documents may be executed by the Vice-Chair of the Board, a Deputy Clerk or the Director,
respectively, with the same effect as if executed by the Chair of the Board or the Clerk of the
Board and the County Administrator.
Section 14. All actions heretofore taken by the supervisors, officers and agents of the
County with respect to the execution and delivery of the Bonds and the other transactions
authorized and contemplated herein are hereby approved, confirmed and ratified.
DOC:SSF1:468618.4 5
Section 15. This Resolution shall take effect from and after its date of adoption.
PASSED AND ADOPTED this 6th day of February , 2001 by the
following vote:
AYES: SUPERVISORS GIOIA, GERBER, DESAULNIER, GLOVER and UILKEMA
NOES: NONE
ABSENT: NONE
ABSTAIN: NONE
Chair oft oard of Supervisors,
County of Contra Costa, California
I Seal]
ATTEST: Philip J. Batchelor, Clerk
of the Board of Supervisors
and County Administrator
B)Deputy
Clerk of the Board of
Supervisors of the County of
Contra Costa, State of California
DOCSSF1:468618.4 6
Resolution 2001/49
CLERK'S CERTIFICATE
1, June L. McHuen , Deputy Clerk of the Board of Supervisors of the County of
Contra Costa(the"County"), hereby certify as follows:
The foregoing is a full, true and correct copy of a resolution duly adopted at a regular
meeting of the Board of Supervisors of said County duly and regularly held at the regular
meeting place thereof on the 6th day of February , 2001, of which meeting all of the
members of said Board of Supervisors had due notice and at which a majority thereof was
present; and at said meeting said resolution was adopted by the following vote:
AYES: SUPERVISORS GIOIA, GERBER, DESAULNIER, GLOVER and'UILKEMA
NOES: NONE
ABSTENTIONS: NONE
An agenda of said meeting was posted at least 96 hours before said meeting in Martinez,
California, at a location freely accessible to members of the public, and a brief general
description of said resolution appeared on said agenda.
I have carefully compared the same with the original minutes of said meeting on file and
of record in my office; the foregoing resolution is a full, true and correct copy of the original
resolution adopted at said meeting and entered in said minutes; and said resolution has not been
amended, modified or rescinded since the date of its adoption, and the same is now in full force
and effect.
WITNESS my hand and the seal of the County of Contra Costa this 6th day of
FPbr„�v_, 2001.
61 Deputy Clerk
of the Board of Supervisors
- of the County of Contra Costa,
State of California
[Seal]_ --
DOCSSF1:468618.4 7
RESOLUTION NO. 2001/49
S!7 V
a -('11610/
COUNTY OF CONTRA COSTA, CALIFORNIA
Taxable Pension Obligation Bonds,
- - Refunding Series 2001
BOND PURCHASE CONTRACT
2001
Board of Supervisors
County of Contra Costa, California
County Administrator's Office
651 Pine Street, 11th Floor
Martinez, California 94553-0063
Ladies and Gentlemen:
The undersigned, Bear, Stearns & Co. Inc., as underwriter (the "Underwriter"), hereby
offers to enter into this Bond Purchase Contract (the "Purchase Contract') with you, the County
of Contra Costa, California (the "County"), for the purchase by the Underwriter of the Bonds (as
hereinafter defined) which will be issued and delivered under the Trust Agreement, dated as of
February 1, 1994, as supplemented by the First Supplemental Trust Agreement, dated as of
1, 2001 (collectively, the "Trust Agreement"), by and between the County and BNY
Western Trust Company, as trustee (the "Trustee").
[Please note: if transaction includes the defeasance to maturity of any of the 1994 Bonds
and/or the issuance of fixed rate bonds instead of variable rate bonds, then this Purchase Contract
will be revised accordingly.]
This offer is made subject to acceptance by the County prior to 11:59 p.m., California
time, on the date hereof. If this offer is not so accepted, this offer will be subject to withdrawal
by the Underwriter upon notice delivered to you at any time prior to acceptance. Upon
acceptance, this Purchase Contract shall be in full force and effect in accordance with its terms
and shall be binding upon the County and the Underwriter.
1. Purchase, Sale and Delivery of the Bonds.
(a) Subject to the terms and conditions and in reliance upon the representations,
warranties and agreements set forth herein, the Underwriter hereby agrees to purchase and the
County agrees to sell to the Underwriter all (but not less than all) of the County of Contra Costa,
California, Taxable Pension Obligation Bonds, Refunding Series 2001 (the "Bonds") in the
aggregate principal amount of $ The Bonds are absolute and unconditional
obligations of the County imposed upon the County by law and are not limited as to payment to
any special source of County funds. The Bonds shall mature on June 1, 2014 and shall initially
10021499/594046.4 1
SD-V
bear interest at a weekly rate of interest of_% per annum until Wednesday, , 2001
and thereafter at a weekly rate of interest as provided in the Trust Agreement.
The Bonds are being issued-(i) to purchase and cancel-(pursuant to-a tender offer program
being conducted by the County) a portion of the County's outstanding 1994 Taxable Pension
Obligation Bonds, 1994 Series A (the "1994 Bonds"), which were originally executed and
delivered in the aggregate principal amount of$337,365,000 and (ii) to pay costs of issuance. In
comlection with such tender offer program, the County and Bear, Stearns & Co. Inc., as Dealer
Manager, have heretofore entered into a Dealer Manager Agreement, dated , (the
"Dealer Manager Agreement").
The Bonds shall be substantially in the form described in, and shall be executed,
delivered and secured under and pursuant to, and shall be payable and subject to redemption as
provided in, the Trust Agreement. The Bonds shall be subject to tender and purchase in
accordance with the terms of the Trust Agreement and the Standby Bond Purchase Agreement
(the "Liquidity Facility"), dated as of January 1, 2001, by and between the County and
Westdeutsche Landesbank Girozentrale, acting through its New York Branch (the "Liquidity
Provider"). The Bonds shall be remarketed as provided in the Remarketing Agreement (the
"Remarketing Agreement"), dated as of 1, 2001, by and between the County and
Bear, Stearns & Co. Inc., as Remarketing Agent (the "Remarketing Agent").
(b) The County has heretofore delivered to the Underwriter copies of the Preliminary
Official Statement, dated , 2001, relating to the Bonds (as amended or
supplemented, the "Preliminary Official Statement"). The County hereby ratifies, confirms and
approves the use and distribution by the Underwriter prior to the date hereof of the Preliminary
Official Statement and the final Official Statement, dated , 2001 (the "Official
Statement") and all other documents, certificates and statements furnished by the County to the
Underwriter in connection with the transactions contemplated by this Purchase Contract, in
connection with the offer and sale of the Bonds.
The Trust Agreement, the Remarketing Agreement, the Liquidity Facility, the Dealer
Manager Agreement and the Bonds shall be collectively referred to herein as. the "Legal
Documents."
(c) The purchase price for the Bonds shall be $ (which reflects an
underwriting discount of $ and fees and expenses of the Liquidity Provider to be
paid by the Underwriter, on behalf of the County, in the amount of$ ).
(d) At a.m., California time, on , 2001, or at such other time or
on such other date as we mutually agree upon (the "Closing Date"), the Trustee will deliver or
cause to be delivered to the Underwriter, through the book-entry system of The Depository Trust
Company in New York, New York ("DTC"), the Bonds in the form of a separate single fully
registered Bond (which may be typewritten) and which shall bear a CUSIP number (timely
provided by the Underwriter), duly executed, together with the other documents mentioned
herein. The Underwriter will accept such delivery and pay the purchase price of the Bonds as set
forth in paragraph (c) above in immediately available finds (such delivery and payment being
10021499/594046.4 2
herein referred to as the "Closing") payable to the order of the Trustee in an amount equal to the
purchase price.
---..--.- - (e) The-Underwriter agrees to snake a bona fide public offering of the--Bonds at the
initial offering price set forth in the Official Statement, which price may be changed from time to
time by the Underwriter after such offering.
2. Representations, Warranties and Agreements of the County.
The County hereby represents, warrants and agrees with the Underwriter as follows:
(a) The County is and will be on the Closing Date a political subdivision of the State
of California duly organized and operating pursuant to the Constitution and laws of the State of
California with full power and authority to execute and deliver the Official Statement, and to
enter into this Purchase Contract and the Legal Documents;
(b) By official action of the County prior to or concurrently with the acceptance
hereof, the County has duly authorized and approved the execution and delivery of, and the
performance by the County of the obligations on its part contained in, the Legal Documents and
this Purchase Contract and the consummation by it of all other transactions contemplated by the
Official Statement, the Legal Documents and this Purchase Contract;
(c) To the best knowledge of the County atter reasonable investigation, the execution
and delivery of the Legal Documents, this Purchase Contract and the Official Statement, and
compliance with the provisions on the County's part contained herein and therein, will not in any
material respect conflict with or constitute a breach of or default under any law, administrative
regulation, judgment, decree, loan agreement, indenture, bond, note, resolution, agreement or
other instrument to which the County is a party or is otherwise subject, nor will any such
execution, delivery or compliance result in the creation or imposition of any lien, charge or other
security interest or encumbrance of any nature whatsoever upon any of the properties or assets of
the County under the terms of any such law, administrative regulation, judgment, decree, loan
agreement, indenture, bond, note, resolution, agreement or other instrument, except as provided
in the Legal Documents;
(d) To the best knowledge of the County atter reasonable investigation, the County is
not in any material respect in breach of or default under any applicable law or administrative
regulation of the State of California or the United States of America or any applicable judgment
or decree or any loan agreement, indenture, bond, note, resolution, agreement or other instrument
to which the County is a party or is otherwise subject, and no event has occurred and is
continuing which, with the passage of time or the giving of notice or both, would constitute a
default or an event of default under any such instrument;
(e) To the best knowledge of the County atter reasonable investigation, there is no
action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court,
governmental agency, public board or body, pending or threatened against the County in any
material respect affecting the existence,of the County or the titles of its officers and officials to
their respective offices or seeking to prohibit, restrain or enjoin the sale, execution or delivery of
10021499/594046.4 J
_T12 V
the Bonds or in any way contesting or affecting the validity or enforceability of the Legal
Documents or this Purchase Contract or contesting the powers of the County or its authority to
enter into or perform its obligations under any of the foregoing, or contesting in any way the
— completeness-or accuracy of the Official Statement, or any amendment or supplement thereto,
wherein an unfavorable decision, ruling or finding would materially adversely affect the validity
or enforceability of the Legal Documents or this Purchase Contract;
(f) The County will furnish such information, execute such instruments and take such
other action in cooperation with the Underwriter as the Underwriter may reasonably request in
order (i) to qualify the Bonds for offer and sale under the Blue Sky or other securities laws and
regulations of such states and other jurisdictions of the United States as the Underwriter may
designate and (ii) to determine the eligibility of the Bonds for investment under the laws of such
states and other jurisdictions, and will use its best efforts to continue such qualification in effect
so long as required for distribution of the Bonds (at the sole expense of the Underwriter);
provided, however, that in no event shall the County be required to take any action which would
subject it to general or unlimited service of process in any jurisdiction in which it is not now so
subj ect;
(g) As of the date hereof, and except for statements regarding DTC and the Liquidity
Provider and certain pricing information determined on the date hereof, as to which the County
does not make any representation or warranty,'the Preliminary Official Statement does not
contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they are made, not misleading
in any material respect;
n
(h) As of the date thereof, and except for statements regarding DTC and the Liquidity
Provider, as to which the County does not make any representation or warranty, the Official
Statement does not contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading in any material respect;
(i) If between the date hereof and the date which is the End of the Underwriting
Period (as hereinafter defined) for the Bonds, an event occurs which would cause the information
contained in the Official Statement, as then supplemented or amended, to contain an untrue
statement of a material fact or to omit to state a material fact required to be stated therein or
necessary to make such information therein, in the light of the circumstances under which it was
presented, not misleading in any material respect, the County will notify the Underwriter, and, if
in the opinion of the County or the Underwriter or their respective counsel, such event requires
the preparation and publication of a supplement or amendment to the Official Statement, the
County will forthwith prepare and furnish to the Underwriter (at the expense of the County) a
reasonable number of copies of an amendment of or supplement to the Official Statement (in
form and substance satisfactory to the Underwriter and counsel for the Underwriter) which will
amend or supplement the Official Statement so that it will not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements therein, in
the light of the circumstances existing at the time the Official Statement is delivered to
purchasers or prospective purchasers, not misleading in any material respect. For the purposes of
this paragraph (i), between the date hereof and the date which is the End of the Underwriting
10021499/594046.4 4
Sa �
e7 ell
Period
Period for the Bonds, the County will furnish such information with respect to itself as the
Underwriter may from time to time reasonably request;
- - --- - - - - 0) if the information contained in the Official Statement is amended or
supplemented pursuant to paragraph (i) above, at the time of each supplement or amendment
thereto and (unless subsequently again supplemented or amended pursuant to such paragraph) at
all times subsequent thereto up to and including the date which is the End of the Underwriting
Period for the Bonds, the portions of the Official Statement so supplemented or amended
(including any financial and statistical data contained therein), except for statements regarding
DTC and the Liquidity Provider, as to which the County does not make any representation or
warranty, will not contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make such information therein, in the light of the
circumstances under which it was presented, not misleading in any material respect;
(k) As used herein and for the purposes of the foregoing, the term "End of the
Underwriting Period" for the Bonds shall mean the Closing Date unless the County shall have
been notified in writing to the contrary by the Underwriter on or prior to the Closing Date; and
(1) To the extent permitted by law, the County agrees to indemnify and hold harmless
the Underwriter and each person, if any, who controls (within the meaning of Section 15 of the
Securities Act of 1933, as amended, or of Section 20 of the Securities Act of 1934, as amended)
the Underwriter, and the officers, directors, agents and employees of the County against any and
all losses, claims, damages, liabilities and expenses, including fees and expenses of legal counsel
(i) arising out of any statement or information in the Preliminary Official Statement or the
Official Statement, relating to the County, that is or is. alleged to be untrue or incorrect in any
material respect or the omission or alleged omission therefrom of any statement or information
that should be stated therein or that is necessary to make the statements therein relating to the
County not misleading in any material respect and (ii) with respect to the settlement of any
litigation commenced or threatened arising from a claim based upon any such untrue statement
or omission or alleged untrue statement or omission, then the aggregate amount paid in
settlement if such settlement is effected with the written consent of the County; provided,
however, that in no event shall this indemnification agreement inure to the benefit of the
Underwriter (or any person controlling the Underwriter) on account of any losses, claims,
damages., liabilities or actions arising from the sale of the Bonds upon the public offering to any
person by the Underwriter if such losses, claims, damages, liabilities or actions arise out of, or
are based upon, (i) an untrue statement or omission or alleged untrue statement or omission in
the Preliminary Official Statement and if the Official Statement shall correct the untrue statement
or omission or the alleged untrue statement or omission which is the basis of the loss, claim,
damage, liability or action for which indemnification is sought and a copy of the Official
Statement had not been sent or given to such person at or prior to confirmation of such sale to
such person or (ii) the negligence or wilfull misconduct of the Underwriter. In case any claim
shall.be made or action brought against the Underwriter or any controlling person based upon the
Preliminary Official Statement or the Official .Statement for which indemnity may be sought
against the County, as provided above, the Underwriter shall promptly notify the County in
writing setting forth the particulars of such claim or action and the County shall assume the
payment of all expenses (including fees and expenses of legal counsel) and the defense thereof,
including at its option the retaining of counsel acceptable to the Underwriter. The Underwriter
10021499/594046.4 5
A
or any such controlling person shall have the right to retain separate counsel in any such action
but shall bear the fees and expenses of such counsel unless the County shall have specifically
authorized the retaining of such counsel. If the parties to such suit include both the Underwriter
---or such controlling person or persons and the County, and the Underwriter or controlling person
or persons have been advised by such counsel that one or more legal defenses may be available
to it or them which may not be available to the County, the County shall not be entitled to
assume the defense of the suit.
3. Conditions'to the Obligations of the Underwriter.
The Underwriter hereby enters into this Purchase Contract in reliance upon the
representations and warranties of the County contained herein and the representations and
warranties to be contained in the documents and instruments to be delivered at the Closing and
upon the performance by the County of its obligations both on and as of the date hereof and as of
the Closing.Date. Accordingly, the Underwriter's obligations under this Purchase Contract to
purchase, to accept delivery of and to pay for the Bonds shall be subject, at the option of the
Underwriter, to the accuracy in all material respects of the representations and warranties of the
County contained herein as of the date hereof and as of the Closing Date, to the accuracy in all
material respects of the statements of the officers and other officials of the County made in any
certificate or other document furnished pursuant to the provisions hereof, to the performance by
the County of its obligations to be performed hereunder and under the Legal Documents at or
prior to the Closing Date, and also shall be subject to the following additional conditions:
(a) At the Closing, the Legal Documents shall have been duly authorized, executed
and delivered by the respective parties thereto, and the Official Statement shall have been duly
authorized, executed and delivered by the County,. all in substantially the forms heretofore
submitted to the Underwriter, with only such changes as shall have been agreed to by the
Underwriter, and shall be in full force and effect; and there shall be in full force and effect such
resolutions of the Board of Supervisors of the County as, in the opinion of Orrick, Herrington &
Sutcliffe LLP ("Bond Counsel"), shall be necessary or appropriate in connection with the
transactions contemplated hereby;
(b) Between the date hereof and the Closing Date, the market price or marketability,
at the initial offering price set forth in the Official Statement, of the Bonds shall not have been
materially adversely affected, in the reasonable judgment of the Underwriter (evidenced by. a
written notice from the Underwriter to the County terminating the obligation of the Underwriter
to accept delivery of and make any payment for the Bonds), by reason of any of the following:
(1) legislation enacted (or resolution passed) by or introduced or pending
legislation amended in the Congress or recommended for passage by the President of the United
States, the Speaker of the House of Representatives, the President Pro Tempore of the Senate, the
Chairperson or ranking minority member of the Committee of Ways and Means of the House of
Representatives or the Chairperson or ranking minority member of the Committee on Finance of
the Senate, or a decision rendered by a court established under Article III of the Constitution of
the United States or by the Tax Court of the United States, or an order, ruling, regulation (final,
temporary or proposed) or press release issued or made by or on behalf of the Treasury
Department of the United States or the Internal Revenue Service, with the purpose or effect,
10021499/594046.4 6
directly or indirectly, of imposing federal income taxation upon moneys that would be received
by the County;
- - - (2) -the declaration of war or engagement in major military hostilities -by the
United States or the occurrences of any other national emergency or calamity relating to the
effective operation of the government of or the financial community in the United States;
(3) the declaration of a general banking moratorium by federal, New York or
California authorities, or the general suspension of trading on any national securities exchange;
(4) the imposition by the New York Stock Exchange or other national
securities exchange, or any governmental authority, of any material restrictions not now in force
with respect to the Bonds or obligations of the general character of the Bonds or securities
generally, or the material increase of any such restrictions now in force, including those relating
to the extension of credit by, or the charge to the net capital requirements of, the Underwriter;
(5) legislation enacted (or resolution passed) by or introduced or pending
legislation amended in the Congress or recommended for passage by the President of the United
States, or an order, decree or injunction issued by any court of competent jurisdiction, or an
order, ruling, regulation (final, temporary or proposed) or press release issued or made by or on
behalf of the Securities and Exchange Commission, or any other governmental agency having
jurisdiction of the subject matter, to the effect that obligations of the general character of the
Bonds, including any or all underlying arrangements, are not exempt from registration under the
Securities Act of 1933, as amended, or that the Trust Agreement is not exempt from qualification
under the Trust Indenture Act of 1939, as amended, or that the execution, offering or sale of
obligations of the general character of the Bonds, including any or all underlying arrangements,
as contemplated hereby or by the Official Statement, otherwise is or would be in violation of the
federal securities laws as amended and then in effect;
(6) the withdrawal or downgrading of any rating of the Bonds by a national
rating agency; or
(7) any event occurring, or information becoming known which, in the
judgment of the Underwriter, makes untrue in any material respect any statement or information
contained in the Official Statement, or has the effect that the Official Statement contains any
untrue statement of a material fact or omits to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading in any material respect;
(c) At or prior to the Closing Date, the Underwriter shall have received the following
documents, in each case satisfactory in form and substance to the Underwriter:
(1) Two copies of the Legal Documents (excluding the Bonds) and this
Purchase Contract,each duly executed and delivered by the respective parties thereto;
(2) The approving opinion, dated the Closing Date and addressed to the
County, of Bond Counsel in substantially the form attached to the Official Statement as
10021499/594046.4 7
Appendix E, and a letter of such counsel, dated the Closing Date and addressed to the
Underwriter, to the effect that such opinion may be relied upon by the Underwriter to the same
extent as if such opinion were addressed to it;
(3) The supplemental opinion, dated the Closing Date and addressed to the
Underwriter, of Bond Counsel, substantially to the effect that (i) each of the Trust Agreement
and the Purchase Contract has been duly executed and delivered by the County and (assuming
due authorization, execution and delivery by and validity with respect to the other parties
thereto) constitutes a valid and binding obligation of the County, subject to laws relating to
bankruptcy or other, laws affecting creditors' rights generally, to the application of equitable
principles if equitable remedies are sought, to the'exercise of judicial discretion in appropriate
cases and to the limitations on legal remedies against public bodies in the State of California and
that no opinion is expressed with respect to the indemnification, contribution, choice of law,
choice of forum or waiver provisions therein; (ii) the Bonds are not subject to the registration
requirements of the Securities Act of 1933, as amended, and the Trust Agreement is exempt from
qualification under the Trust Indenture Act of 1939, as amended; and (iii) the statements
contained in the Official Statement under the captions "THE 2001 BONDS," "SECURITY AND
SOURCES OF PAYMENT FOR THE 2001 BONDS," "TAX MATTERS," "APPROVAL OF
LEGALITY=Validation Proceedings," and in Appendix D - "SUMMARY OF CERTAIN
PROVISIONS OF THE TRUST AGREEMENT" and in Appendix E - "PROPOSED FORM OF
BOND COUNSEL OPINION" (excluding therefrom all information contained in debt service
schedules and financial or statistical information as to which no view is expressed) insofar as
such statements purport to summarize certain provisions of the Trust Agreement and Bond
Counsel's opinion concerning certain tax matters relating to the Bonds, are accurate in all
material respects;
(4) The opinion of the County Counsel, dated the Closing Date and addressed
to the Underwriter, to the effect that (i) the County is a political subdivision of the State of
California duly organized and operating pursuant to the Constitution and laws of the State of
California; (ii) the resolution or resolutions of the County approving and authorizing the
execution and delivery by the County of the Legal Documents, the Purchase Contract and the
Official, Statement (the "County Resolution") were duly adopted at meetings of the Board of
Supervisors of the County which were called and held pursuant to law and with all public notice
required by law and at which a quorum was present and acting throughout; (iii) to the best
knowledge of such counsel after reasonable investigation, there is no action, suit, proceeding or
investigation at law or in equity before or by any court, public board or body, pending or
threatened against or affecting the County, to restrain or enjoin the payment of the amounts with
respect to the Trust Agreement, or in any way contesting or affecting the validity of the Legal
Documents or the Purchase Contract; (iv) the execution and delivery of the Legal Documents,
the Purchase Contract and the Official Statement, the adoption of the County Resolution, and
compliance by the County with the provisions of the foregoing, under the circumstances
contemplated thereby, do not and will not in any material respect conflict with or constitute on
the part of the County a breach or default under any agreement or other instrument to which the
County is a party (and of which such counsel is aware after reasonable investigation) or by which
it is bound (and of which such counsel is aware after reasonable investigation) or any existing
law, regulation, court order or consent decree to which the County is subject; (v) the Official
10021499/594046.4 8
Statement, the Legal Documents and the Purchase Contract have been duly authorized, executed
and delivered by the County and, assuming due authorization, execution and delivery by and
validity against the other parties thereto, constitute legal, valid and binding agreements of the
-- County- enforceable in -accordance with their respective terms, subject to laws relating to
bankruptcy, insolvency or other laws affecting the enforcement of creditors' rights generally and
the application of equitable principles if equitable remedies are sought, the exercise of judicial
discretion and the limitation on legal remedies against public entities in California; and (vi)
except as described in the Official Statement, no authorization, approval, consent, or other order
of the State of California or any other governmental authority or agency within the State of
California having jurisdiction over the County is required for the valid authorization, execution,
delivery and performance by the County of the Legal Documents, the Official Statement and the
Purchase Contract or for the adoption of the County Resolution which has not been obtained;
(5) The opinion, dated the Closing Date and addressed to the Underwriter and
the County, of Counsel to the Trustee, to the effect that (i) the Trustee is a banking corporation
duly organized and validly existing under the laws of the State of California, duly qualified to do
business and to exercise trust powers therein, having full power and authority to enter into and to
perform its duties as Trustee under the Trust Agreement, (ii) the Trustee has duly authorized,
executed and delivered the Trust Agreement, (iii) the Trust Agreement constitutes a legally valid
and binding agreement of the Trustee, enforceable against the Trustee in accordance with its
terms, (iv) the Bonds have been duly authenticated and delivered by the Trustee, (v) no
authorization, approval, consent, or other order of the State of California or any other
governmental authority or agency within the State of California having jurisdiction over the
Trustee is required for the valid authorization, execution, delivery and performance by the
Trustee of the Trust Agreement, and (vi) the execution and delivery of the Trust Agreement and
compliance by the Trustee with the provisions of the Trust Agreement, under the circumstances
contemplated thereby, do not and will not in any material respect conflict with or constitute on
the part of the Trustee a breach or default under any agreement or other instrument to which the
Trustee is a party (and of which such counsel is aware after reasonable investigation) or by
which it is bound (and of which such counsel is aware after reasonable investigation) or any
existing law, regulation, court order or consent decree to which the Trustee is subject;
(6) The opinion, dated the Closing Date and addressed to the Underwriter, of
Fulbright & Jaworski L.L.P., Los Angeles, California, counsel for the Underwriter
("Underwriter's Counsel") to the effect that (a) the Bonds are not subject to the registration
requirements of the Securities Act of 1933, as amended, and the Trust Agreement is exempt from
qualification under the Trust Indenture Act of 1939, as amended, and (b) without passing upon or
assuming any responsibility for the accuracy, completeness or fairness of the statements
contained in the Official Statement and making no representation that they have independently
verified the accuracy, completeness or fairness of any such statements, based upon the
information made available to personnel in their firm in the course of their participation in the
preparation of the Official Statement as Underwriter's Counsel, nothing has come to their
attention which would lead them to believe that the Official Statement as of its date (excluding
therefrom any information in the Official Statement relating to DTC or the operation of the
book-entry system, the information relating to the Liquidity Provider, any information in the
appendices of the Official Statement (other than Appendix D of the Official Statement), or any
10021499/594046.4 9
other financial or statistical data included in the Official Statement, as to which no opinion need
be expressed) contains an untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary to.make the statements therein, in the light of.the
...circum stances under which they were made, not misleading in any material respect;
(7) An opinion of Bond Counsel, dated the Closing Date and addressed to the
County and the Underwriter, substantially to the effect that upon the issuance of the Bonds and
the application of the proceeds thereof in accordance with the Trust Agreement, all liability of
the County in respect of the 1994 Bonds defeased to maturity with proceeds of the Bonds has
ceased, terminated and been discharged pursuant to the terms of the Trust Agreement;
(8) An opinion of counsel to the Liquidity Provider, dated the Closing Date
and addressed to the County, the Underwriter and the Trustee, to the effect that (i) the Liquidity
Facility has been duly authorized, executed and delivered by the Liquidity Provider and,
assuming due authorization, execution and delivery of the other parties thereto, the Liquidity
Facility constitutes the legal, valid and binding obligation of the Liquidity Provider enforceable
in accordance with its terms, subject to laws relating to bankruptcy, insolvency or other laws
affecting the enforcement of creditors' rights generally and the application of equitable principles
if equitable remedies are sought, and (ii) the statements in the Official Statement under the
caption "THE LIQUIDITY FACILITY," to the extent such statements purport to summarize
certain provisions of the Liquidity Facility, present a fair and accurate summary of such
provisions;
(9) A certificate or certificates, dated the Closing Date, signed by a duly
authorized official of the County satisfactory to the Underwriter, in form and substance
satisfactory to the Underwriter, to the effect that, to the best of such official's knowledge after
reasonable investigation, (a) the representations and warranties of the County contained in the
Purchase Contract are true and correct in all material respects on and as of the Closing Date with
the same effect as if made on the Closing Date; (b) no litigation is pending or threatened (i) to
restrain or enjoin the execution, sale or delivery of any of the Bonds or any payments with
respect to the Bonds, (ii) in any way contesting or affecting the validity or enforceability of the
Purchase Contract or the Legal Documents, or (iii) in any way contesting the existence or powers
of the County material to the issuance of the Bonds and the execution and delivery of the
Purchase Contract, the Legal Documents and the Official Statement; and (c) no event affecting
the County has occurred since the date of the Official Statement which either makes'untrue or
incorrect in any material respect as of the Closing Date any statement or information contained
in the Official Statement relating to the County or is not reflected in the Official Statement but
should be reflected therein in order to make the statements and information therein relating to the
County not misleading in any material'respect;
(10) A certificate, dated the date of Closing, signed by a duly authorized
official of the Trustee, satisfactory in form and substance to the Underwriter, to the effect that:
(i) the Trustee is a banking corporation duly organized and validly
existing under the laws of the State of California, having the full power and being qualified to
enter into and perform its duties under the "Trust Agreement and to execute and deliver the Bonds
10021499/594046.4 10
sem,.y
to the Underwriter, and the Trust Agreement constitutes the legal, valid and binding obligation of
the Trustee, enforceable in accordance with its terms;
...=-- - ---.-- -- (ii) the Trustee is duly authorized to enter into the Trust Agreement-and to
execute and deliver the Bonds to the Underwriter pursuant to the Trust Agreement;
(iii) the execution and delivery of the Trust Agreement and compliance
with the provisions on the Trustee's part contained therein, will not conflict with or constitute a
breach of or default under any law, administrative regulation,judgment, decree, loan agreement,
indenture, bond, note, resolution, agreement or other instrument to which the Trustee is a party
or is otherwise subject (except that no representation, warranty or agreement is made with
respect to any federal or state securities or blue sky laws or regulations), nor will any such
execution, delivery, adoption or compliance result in the creation or imposition of any lien,
charge or other security interest or encumbrance of any nature whatsoever upon any of the
properties or assets held by the Trustee pursuant to the lien created by the Trust Agreement under
the terms of any such law, administrative regulation, judgment, decree, loan agreement,
indenture, bond, note, resolution, agreement or other instrument, except as provided by the Trust
Agreement;
(iv) the 1994 Bonds purchased with proceeds of the Bonds have been
cancelled by the Trustee in accordance with the Trust Agreement; and
(v) to the best of the knowledge of the Trustee, it has not been served with
any action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court,
governmental agency, public board or body, nor is any such action or other proceeding
threatened against the Trustee, affecting the existence of the Trustee, or the titles of its officers to
their respective offices or seeking to prohibit, restrain or enjoin the execution and delivery of the
Bonds or the collection of revenues to be applied to pay the principal and interest with respect to
the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or
enforceability of the Legal Documents or the Purchase Contract, or contesting the powers of the
Trustee or its authority to enter into or.perform its obligations under the Trust Agreement,
wherein an unfavorable decision, ruling or finding would materially adversely affect the validity
or enforceability of the Legal Documents or the Purchase Contract;
(11) A certificate, signed by a duly authorized officer of the Liquidity Provider,
in form and substance satisfactory to the County and the Underwriter, dated the Closing Date, to
the effect that the statements and financial information in the Official Statement under the
caption "THE LIQUIDITY PROVIDER" are true and accurate;
(12) Two copies of the Official Statement, executed on behalf of the County by
an authorized representative of the County;
(13) Two certified copies of the general resolution of the Trustee authorizing
the execution and delivery of the Trust Agreement;
(14) Two certified copies of the County Resolution;
10021499/594046.4 11
sZ). y
a -G-ol
(15) Evidence that the ratings regarding the Bonds described in the Official
Statement are in frill force and effect as of the Closing Date; and
- -- -- - (16) Such-additional legal opinions, certificates, proceedings, instruments or -
evidences thereof and other documents as the Underwriter, Underwriter's Counsel or Bond
Counsel may reasonably request to evidence the truth and accuracy, as of the date hereof and as
of the Closing Date, of the representations and warranties of the County herein and of the
statements and information contained in the Official Statement, 'and the due performance or
satisfaction by the Trustee and the County at or prior to the Closing of all agreements then to be
performed and all conditions then to be satisfied by either of them in connection with the
transactions contemplated hereby and by the Legal Documents, this Purchase Contract and the
Official Statement.
4. Expenses.
All expenses and costs incident to the authorization, execution, delivery and sale of the
Bonds to the Underwriter, including the costs of printing of the Bonds, the Preliminary Official
Statement, the Official Statement, the cost of duplicating the Legal Documents and this Purchase
Contract, the fees and expenses of the Liquidity Provider, Bondholder Communications Group,
C.M. de Crinis & Co., Inc., accountants, other consultants and rating agencies, the initial fee of
the Trustee (including in its capacity as tender agent for the Bonds) and its counsel in connection
with the execution and delivery of the Bonds and the fees and expenses of Orrick, Herrington &
Sutcliffe LLP and counsel to the Liquidity Provider shall be paid from the proceeds of the Bonds
or by the County. All out-of-pocket expenses of the Underwriter, including traveling and other
expenses, including those associated with the California Debt and Investment Advisory
Commission, the production of the County's presentations to rating agencies and the preparation
of any Blue Sky Memorandum and Legal Investment Survey, and the fees and expenses of
Underwriter's Counsel, shall be paid by the Underwriter.
5. Notices.
Any notice or other co>nmunication to be given to the other party to this Purchase
Contract may be given by delivering the same in writing to such other party at the following
address:
Underwriter: Bear, Stearns & Co. Inc.
1999 Avenue of the Stars, 32nd Floor
Los Angeles, California 90067-6100
Attention: Michelle Issa
County: County of Contra Costa
County Administrator's Office
651 Pine Street, 6th Floor
Martinez, California 94553-0063
Attention: Director, Capital Facilities and Debt
Management
10021499/594046.4 12
6. Survival of Representations and Warranties.
- - --- -The representations and--warranties of the County set forth in or-made pursuant to this
Purchase Contract shall not be deemed to have been discharged, satisfied or otherwise rendered
void by reason of the Closing or termination of this Purchase Contract and regardless of any
investigations or statements as to the results thereof made by or on behalf of the Underwriter and
regardless of delivery of and payment for the Bonds.
This Purchase Contract may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original.
10021499/594046.4 13
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a
7. Effectiveness.
This Purchase Contract shall become effective and binding upon the respective parties
hereto-upon the execution-of-the acceptance hereof by a duly-authorized officer of the-County
and shall be valid and enforceable as of the time of such acceptance.
Very truly yours,
BEAR, STEARNS & CO. INC., as
Underwriter
By:
Michelle Issa
Managing Director,
ACCEPTED:
COUNTY OF CONTRA COSTA,
CALIFORNIA
By:
Laura W. Lockwood
Director, Capital Facilities and
Debt Manager
APPROVED AS TO FORM:
COUNTY COUNSEL
By:
County Counsel
10021499/594046.4 14
DEALER MANAGER AGREEMENT
[date]
Bear, Stearns & Co. Inc.
as Dealer Manager
1999 Avenue of the Stars
31"Floor
Los Angeles, California 90067
Ladies and Gentlemen:
The County of Contra Costa, California (the "County") plans to invite the beneficial
owners (the "Bondowners") of its outstanding Taxable Pension Obligation Bonds, 1994 Series A
(the "Bonds") to offer to sell such Bonds to the County for cash upon the terms and subject to the
conditions set forth in the County's "Invitation to. Tender Bonds" dated , 2001 (the
"Invitation"). The Bonds are listed in the Invitation.
In addition to the Invitation, the County has also prepared for use in connection with the
Invitation the following documents:
• "Letter from the County to Bondowners", including "Answers To Frequently Asked
Questions"
• "Request to Transmit To Your Clients and Their Brokers"
• "Notice To Our Clients"
• "Bondowner's Instructions"
• "Solicitation Fee Payment Request Form"
• Press Release dated 32001
• Preliminary Official Statement relating to the County's Taxable Pension Obligation
Bonds, Refunding Series 2001.
These seven documents are referred to in this Dealer Manager Agreement (this "Agreement") as
the "Ancillary Documents." The Invitation and the Ancillary Documents are referred to in this
Agreement as the "Invitation Material." Any other material relating to the Invitation prepared by
the County or that is approved by the County in writing subsequent to the execution of this
Agreement that is intended to be used by the Dealer Manager in connection with the Invitation is
referred to as the"Additional Material."
1. Appointment of the Dealer Manager
The County hereby appoints Bear, Stearns & Co. Inc. as the Dealer Manager in
connection with the Invitation (the "Dealer Manager"). The County and the Dealer Manager
593515.4 w97
� t7• �
agree that institutional investors with questions about the Invitation should contact the .Dealer
Manager. The County and the Dealer Manager agree that individual investors and their brokers
and account executives with questions about the Invitation should contact the Information Agent
described below. The County authorizes the Dealer Manager to act on its behalf in accordance
with this Agreement and the terms of the Invitation Material and Additional Material. The
County has approved the Invitation Material and authorizes the Dealer Manager to use the
Invitation Material and Additional Material in connection with the solicitation of offers to sell
Bonds to the County (subject to the third and fourth sentences of this Section 1). The Dealer
Manager agrees not to furnish written materials to holders or beneficial owners of Bonds in
connection with the Invitation other than the Invitation Material and Additional Material. In
performing its obligations under this Agreement, the Dealer Manager shall act as an independent
contractor and shall not be deemed to act as an agent of the County, and the County shall not be
deemed to act as the agent of the Dealer Manager.
2. The Information Agent
The County.has previously appointed Bondholder Communications Group of
New York City as the Information Agent for the Invitation.
3. Furnishing Material to. Information Services
The County shall provide or cause to be provided to the Information Services (as
defined in the Invitation) in the manner set forth in the Invitation the Invitation Material and any
Additional Material.
4. Solicitation of Offers to.Sell Bonds
(a) The Dealer Manager agrees to use its best efforts to solicit offers to sell
Bonds to the County pursuant to the Invitation (subject to the third and
fourth sentences of Section 1).
(b) The County agrees to furnish to the Dealer Manager a reasonable number
of copies of the Invitation Material and Additional Material for use in
connection with the Invitation. The County agrees to furnish to the Dealer
Manager as promptly as practicable prior to. the effective date thereof
copies of any written amendments 'or supplements to the Invitation
Material and any Additional Material. The County also agrees to notify
the Dealer Manager as promptly as practicable prior to the effective date
thereof of any extension or termination of the Invitation or of the
Settlement Date (as defined in the Invitation).
(c) The County agrees to advise the Dealer Manager promptly of the
occurrence of any event which would cause the County to extend,
terminate, modify, amend, supplement or waive any condition of the
Invitation, or to amend or supplement the Invitation Material or Additional
Material.
593515.4 w97 -2-
S'D• `r
(d) The County will not use or publish any material in connection with the
Invitation, or refer to the Dealer Manager in any such material, without
first consulting with the Dealer Manager. The County will promptly
inform the Dealer Manager of any litigation or administrative action with
respect to the Invitation.
(e) The County agrees to.use its best efforts to cause the Information Agent to
cooperate with the Dealer Manager as reasonably requested by the Dealer
Manager. The County will promptly furnish to the Dealer Manager copies
of all Bondowner lists furnished to the County by the Information Agent.
The Dealer Manager agrees to use the information furnished to it by the
County or the Information Agent only in connection with the Invitation
and not to furnish such information to any other person except in
connection with the Invitation.
5. Compensation and Expenses
(a) The County shall pay to the Dealer Manager, as compensation for its
services as the Dealer Manager hereunder, a fee of$ for each $1,000
principal amount of Bonds purchased by the County pursuant to the
Invitation, payable on the Settlement Date.
(b) Whether or not any Bonds are offered or purchased pursuant to the
Invitation, the County shall pay all expenses for the preparation, printing,
mailing and publishing of the Invitation Material and Additional Material.
If Bonds are purchased pursuant to the Invitation, the County shall pay all
of the Dealer Manager's reasonable out-of-pocket expenses incurred in
connection with its serving as Dealer Manager hereunder. In the event no
Bonds are offered or purchased pursuant to the Invitation, the County shall
negotiate in good faith with the Dealer Manager to determine the amount
of expenses to be reimbursed by the County to the Dealer Manager.
(c) The County will pay the solicitation fees and the reimbursements specified
in the Invitation.
6. Representations and Warranties by the County
The County represents and warrants to, and agrees with, the Dealer Manager that:
(a) The County has been duly created and is validly existing under the laws of
the State of California.
(b) The Invitation Material and any Additional Material, and the execution,
delivery and performance of this Agreement, have been duly authorized
by proper proceedings of the County, and this Agreement has been duly
executed and delivered by the County and constitutes the legal, valid and
binding agreement of the County, enforceable in accordance with its
terms, except that enforcement of this Agreement may be subject to
593515.4 w97 -3-
,SID
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
principles of equity.
(c) The Invitation Material and Additional Material do not and (as amended
or supplemented, if amended or supplemented) will not contain any untrue
statement of material fact relating to the terms of the Invitation or omit to
state any material fact necessary in order to make the statements made
relating to the terms of the Invitation, in the light of the circumstances
under which they were made, not misleading.
If, during the period commencing with the date of the Invitation to and
including the Settlement Date, any event shall occur which might or would
cause the Invitation Material or the Additional Material, as then amended
or supplemented, to contain any untrue statement of a material fact or to
omit to state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading,
the County shall notify the Dealer Manager thereof, and if in the opinion
of the Dealer Manager such event requires the preparation and publication
of a supplement or amendment to the Invitation Material or the Additional
Material, the County at its expense will prepare and furnish, or cause to be
prepared and furnished, to the Dealer Manager a reasonable number of
copies of the supplement or amendment to the Invitation Material or the
Additional Material in a form and in a manner approved by the Dealer
Manager.
(d) The making and consummation of the Invitation and the execution,
delivery and performance by the County of this Agreement do not and will
not conflict with, or result in the acceleration of any obligation under, or in
a breach of or constitute a default under, any of the provisions of any
material resolution, indenture, loan agreement or mortgage to which the
County is a party or by which it is bound or to which any material part of
its property or assets is subject, and do not and will not contravene in any
material respect any Federal, state or local law, rule or regulation to which
the County is subject, or any order applicable to the County of any court
or of any other governmental agency or instrumentality having jurisdiction
over it or any material part of its property.
(e) The County will apply proceeds from the sale of its Taxable Pension
Obligation Bonds, Refunding Series 2001, to the timely payment of the
aggregate purchase prices of the Bonds that it decides to purchase
pursuant to the Invitation, and all related fees and expenses payable by the
County. Such proceeds also may be used to establish a defeasance escrow
for a portion of the Bonds.
(f) As of the date hereof, there is no action, suit, proceeding, inquiry or
investigation, at law or in equity, before or by any court, government
593515.4 w97 -4-
Y
a-6 -oi
agency, public board or body, pending or, to the knowledge of the County,
threatened against the County, affecting the legal existence of the County
or the titles of its officers or officials to their respective offices, or
affecting or seeking to prohibit, restrain or enjoin the transactions
contemplated by this Agreement and the Invitation, or questioning,
contesting or affecting as to the County the validity or enforceability of
this Agreement, or contesting powers of the County to carry out the
transactions contemplated hereunder or under the Invitation Material or
the execution and delivery by the County of this Agreement, and nothing
has come to the attention of the County that there is any basis for any such
action, suit, proceeding, inquiry or investigation, wherein an unfavorable
decision, ruling or finding would materially adversely affect the
authorization, execution, delivery or performance by the County of this
Agreement.
7. Representations and Warranties by the Dealer Manager
The Dealer Manager represents and warrants to, and agrees with, the County that:
(a) This Agreement has been duly authorized, executed and delivered by the
Dealer Manager and constitutes its legal; valid and binding obligation,
enforceable in accordance with its terms, except as enforcement may be
limited by bankruptcy, insolvency, reorganization and similar laws
affecting creditors' rights and by general principles of equity.
(b) The execution, delivery and perfonmance of this Agreement by the Dealer
Manager does not and will not violate, in any material respect, any law,
regulation or rule to which the Dealer Manager is subject.
(c) During the period of the Invitation, the Dealer Manager shall not effect
any transactions in the Bonds for the purpose of raising or depressing the
price of the Bonds.
8. Conditions of Obligation
The Dealer Manager's obligations under this Agreement shall at all times be
subject, in the Dealer Manager's discretion, to the conditions that:
(a) All representations, warranties and other statements of the County
contained herein are now, and at all times during the Invitation will be,
true and correct in all material respects.
(b) The County at all times during the Invitation shall have performed all of
its obligations hereunder theretofore required to have been performed.
593515.4 w97 -5-
9. Indemnity and Survival of Certain Provisions
(a) To the extent permitted by applicable law, the County agrees to indemnify
and hold the Dealer Manager harmless against any and all losses,
damages, liabilities or claims (or actions in respect thereof)that arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Invitation Material or any Additional
Material or in any amendment or supplement to any of the foregoing or
that arise out of or are based upon the omission or alleged omission to
state therein a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, the Dealer Manager shall not be
indemnified for any claims, damages, losses, liabilities, costs or expenses
relating to an untrue statement of a material fact or omission to state a
material fact by, or based on written information provided by, the Dealer
Manager or any controlling person of the Dealer Manager or to the extent
that any loss, damage, expense, liability or claim incurred results from the
negligence, bad faith or willful misconduct of the Dealer Manager or any
of its affiliates, partners, directors, agents, employees or controlling
persons (if any) in performing the services that are the subject of this
Agreement.
(b) Subject to the limitations contained in this Section, in the event that the
Dealer. Manager becomes involved in any capacity in any action,
proceeding or investigation brought by or against any person (other than a
dispute between the Dealer Manager and the County arising out of this
Agreement), including Bondowners, in connection with any matter
referred to in subsection (a) of this Section for which the County has
agreed to indemnify and hold harmless the Dealer Manager, the County
also agrees periodically to reimburse the Dealer Manager for the Dealer
Manager's legal and other reasonable expenses (including the cost of any
investigation and preparation) incurred in connection therewith.
(c) Neither the Dealer Manager nor any of its affiliates, nor any partners,
directors, agents, employees or controlling persons (if any), as the case
may be, of the Dealer Manager or any such affiliates, shall have any
liability to the County or any person asserting claims on behalf of the
County for or in connection with any matter referred to in this Agreement
except to the extent that any loss, damage, expense, liability or claim
incurred by the County results from the negligence, bad faith or willful
misconduct of the Dealer Manager or any of its affiliates, partners,
directors, agents, employees or controlling persons (if any) in performing
the services that are the subject of this Agreement.
(d) Promptly after receipt by the Dealer Manager of notice of the Dealer
Manager's involvement in any action, proceeding or investigation
described in subsection (a) of this Section, the Dealer Manager shall, if a
593515.4 w97 -6-
claim in respect thereof is to be made against the County under subsection
(a) of this Section, notify the County in writing of such involvement, but
the failure so to notify the County shall not relieve the County from any
liability which it may otherwise have to the Dealer Manager under
subsection (a) of this Section except,to the extent that the County suffers
actual prejudice as a result of such failure. In case any such action,
proceeding or investigation shall be brought against or otherwise involve
the Dealer Manager and the Dealer Manager shall notify the County of the
commencement thereof or the Dealer Manager's involvement therein, the
County shall be entitled to participate therein, but the defense of any such
action, proceeding or investigation shall be conducted by the Dealer
Manager's counsel unless the Dealer Manager shall consent to a request
by the County to assume the defense thereof with counsel satisfactory to
the Dealer Manager. Upon any such assumption by the County of the
defense of such action, proceeding or investigation, the Dealer Manager
shall have the right to participate in such action, proceeding or
investigation and to retain the Dealer Manager's own counsel, but the
County shall not be liable to the Dealer Manager under this subsection for
any legal fees and expenses of other counsel subsequently incurred by the
Dealer Manager in connection with the defense thereof unless (i) the
County has agreed to pay such fees and expenses, (ii) the County shall
have failed to employ counsel satisfactory to the Dealer Manager in a
timely manner, or (iii) the Dealer Manager shall have been advised by
counsel that there are actual or potential conflicting interests between the
County and the Dealer Manager, including, but not limited to, situations in
which there are one or more legal defenses available to. the Dealer
Manager that are different from or additional to those available to the
County. . The Dealer Manager shall not consent to any compromise or
settlement of any such action, proceeding or investigation without the
County's prior written consent, unless such compromise or settlement
does not result in any liability to the County hereunder.
(e) If as a matter of law the indemnification provided for in subsection (a) of
this Section is unavailable to hold the Dealer Manager harmless, then the
County shall, to the extent permitted by applicable law, contribute to the
amount paid or payable by the Dealer Manager as a result of such loss,
damage, expense, liability or claim (or action in respect thereof) referred
to therein in such proportion as is appropriate to -reflect the relative
benefits of the County on the one hand and the Dealer Manager on the
other hand in the matters contemplated by this Agreement (taking into
account (i) the estimated reduction in debt service to be paid by the
County on and prior to the June 1, 2011 final maturity of the Bonds
(assuming that the variable rate bonds to be issued to provide moneys for
the purchase of Bonds bear an interest rate, taking into consideration
liquidity and remarketing fees, of 6.50% per annum) and (ii) the fees paid
or anticipated to be paid to the Dealer Manager pursuant to Section 5 of
this Agreement), as well as the relative fault of the County and the Dealer
593515.4 w97 -7-
Manager with respect to such loss, damage, expense, liability or claim (or
action in respect thereof) and any other relevant equitable considerations.
The County and the Dealer Manager agree that it would not be just and
equitable if contribution pursuant to this subsection were determined by
pro rata allocation or by any other method of allocation which does not
take account of the equitable considerations referred to in this subsection.
(f) The agreements contained in Section 5 and in this Section and the
representations and warranties set forth in Sections 6 and 7 hereof shall
survive any termination or cancellation of this Agreement, any completion
of the engagement provided by this Agreement, any investigation made by
or on behalf of the Dealer Manager, any of the Dealer Manager's officers
or partners, any person controlling the Dealer Manager or any other person
and any termination or expiration of the Invitation.
(g) The reimbursement, indemnity and contribution obligations of the County
under this Section shall be in addition to any liability that the County may
otherwise have, shall apply upon the same terms and conditions to the
Dealer Manager's affiliates and the partners, directors, officers, agents,
employees and controlling persons (if any), as the case may be, of the
Dealer Manager and any such affiliate, and shall be binding upon and
inure to the benefit of, as applicable, any successors, assigns, heirs and
personal representatives of the County, the Dealer Manager, any such
affiliate and any of such other person referred to above but there shall be
no double recovery with respect to any losses, damages, liabilities, claims,
costs or expenses.
10. Miscellaneous
(a) This Agreement is made solely for the benefit of the Dealer Manager, the
County and any partner, director, officer, agent, employee, controlling
person or affiliate referred to in Section 9 hereof, and their respective
successors, assigns, and legal representatives, and no other person or
entity shall acquire or have any right under or by virtue of this Agreement.
(b) In the event that any provision of this Agreement shall be determined to be
invalid or unenforceable in any respect, such determination shall not affect
any other provision hereof, which shall remain in full force and effect.
(c) Except as otherwise expressly provided in this Agreement, whenever
notice is required by the provisions of this Agreement to be given to (i) the
County, such notice shall be in writing addressed to the County, at the
Office of the County Administrator, 651 Pine Street, 6th Floor, Martinez,
California 94553, Attention: Director, Capital Facilities and Debt
Management; telephone (925) 335-1086, facsimile (925) 335-1093, and
(ii) the Dealer Manager, such notice shall be in writing addressed to Bear,
Stearns & Co. Inc., 1999 Avenue of the Stars, 3151 Floor, Los Angeles,
593515.4 w97 -8-
California 90067, Attention: Michelle Issa, telephone (310) 201-7883,
facsimile (3 10) 201-2754.
(d) This Agreement contains the entire understanding of the parties with
respect to the Dealer Manager acting as Dealer Manager of the Invitation,
superseding any and all prior agreements, understandings and negotiations
with respect to such activities by the Dealer Manager. This Agreement
shall be governed by and construed in accordance with the laws of the
State of California without regard to principles of conflict of laws. This
Agreement may be executed in any number of counterparts, each of which
shall be an original, but all such counterparts shall together constitute one
and the same agreement.
Please sign and return to us a duplicate of this letter, whereupon it will become a
binding agreement between us.
Very truly yours,
CONTRA COSTA COUNTY, CALIFORNIA
By:
County Administrator and Clerk
of the Board of Supervisors
The undersigned hereby confirms that the
foregoing letter, as of the date thereof,
correctly sets forth the agreement between
the County and the undersigned.
BEAR, STEARNS & CO. INC.
By:
Michelle Issa
Managing Director
593515.4 w97 -9-
J V.
ESCROW AGREEMENT
by and between
COUNTY OF CONTRA COSTA
and
BNY WESTERN TRUST COMPANY
Dated as of January 1, 2001
relating to the
COUNTY OF CONTRA COSTA TAXABLE PENSION OBLIGATION BONDS,
1994 SERIES A
Docssrl:371G18.3
ESCROW AGREEMENT
THIS ESCROW AGREEMENT, dated as of January 1, 2001, is entered into by
and between COUNTY OF CONTRA COSTA, a political subdivision duly organized and
existing under the Constitution and Laws of the State of California (the "County"), and BNY
WESTERN TRUST COMPANY, duly organized and existing under and by virtue of the laws of
the State of California, as trustee and as escrow bank (the "Escrow Agent").
WITNESSETH:
WHEREAS, the Escrow Agent, as trustee and the County have heretofore
executed the Trust Agreement, dated as of February 1, 1994, (the "Original Trust Agreement") .
(as supplemented by a First Supplemental Trust Agreement dated as of January 1, 2001 (the
"First Supplemental Trust Agreement", and collectively with the Original Trust Agreement the
"Trust Agreement");
WHEREAS, the County has heretofore issued $337,3655,000 County of Contra
Costa Taxable Pension Obligation Bonds, 1994 Series A (the"Refunded Bonds") pursuant to the
Original Trust Agreement;
WHEREAS, pursuant to Article III of the Original Trust Agreement, the County
may issue Additional Bonds for, among other purposes, the refunding of any Bonds then
Outstanding, provided that the conditions to the issuance of Additional Bonds as set forth in
Article III of the Original Trust Agreement are satisfied;
WHEREAS, the County has determined that it is in the County's best interests to
purchase pursuant to a tender a portion of the Refunded Bonds and/or to advance refund a
portion of the Refunded Bonds to their final maturity date and to issue its County of Contra
Costa, California Taxable Pension Obligation Bonds, Refunding Series 2001 in the aggregate
principal amount of$ (the "Refunding Bonds");
WHEREAS, Section 14.01 of the First Supplemental Trust Agreement provides
for the transfer and deposit of certainproceeds of the Refunding Bonds to the Escrow Fund
created hereunder to advance refund and defease the Refunded Bonds, and such proceeds shall be
in such amount and shall be invested in Permitted Investments under the Trust Agreement so as
to insure the full and timely payment of the Refunding Requirements (as hereinafter defined);
and,
WHEREAS, in order to further insure the full and timely payment of the
Refunding Requirements, the Escrow Agent is also being authorized and directed by the County
to enter into the Escrow Fund Forward Sale Agreement (herein, the "Forward Sale Agreement")
dated as of January 1, 2001 with (the"Provider"), which Forward Sale
Agreement is attached hereto as Exhibit D;
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TABLE OF CONTENTS
Page
Section1. Definitions.......................................................................................................................................2
Section 2. Creation and Purpose of Escrow.....................................................................................................3
Section3. Bondholder Notices.........................................................................................................................4
Section 4. Accounting for Escrow; Substitutions.............................................................................................4
Section 5. Investments and Reinvestments......................................................................................................5
Section 6. Sufficiency of Escrow.....................................................................................................................5
Section 7. Transfers for Payment of Refunded Bonds.....................................................................................5
Section 8. Termination of Escrow Agreement; Written Request of County....................................................5
Section9. Fees and Costs.................................................................................................................................5
Section10. Reports............................................................................................................................................6
Section 11. Character of Deposit. ......................................................................................................................6
Section 12. Exculpatory Provisions...........................................................................................
Section13. Time of Essence..............................................................................................................................8
Section14. Amendments. ..................................................................................................................................8
Section15. Successors.......................................................................................................................................8
Section16. Notices. ...........................................................................................................................................8
Section17. Severability. ....................................................................................................................................9
Section18. Law Governing. .............................................................................................:................................9
Section19. Counterparts.....................................................................................................................................9
EXHIBIT A REFUNDING REQUIREMENTS..............................................................................................A-1
EXHIBIT B ESCROWED SECURITIES.......................................................................................................B-1
EXHIBITC NOTICE OF DEFEASANCE.....................................................................................................C-1
EXHIBIT D ESCROW FUND FORWARD SALE AGREEMENT...............................................................D-1
EXHIBITE ELIGIBLE SECURITIES........................................................................................................... E-1
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NOW, THEREFORE, in of the mutual agreements.herein
contained, in order to secure the payment of the Refunding Requirements as heretofore provided,
the parties hereto mutually undertake, promise and agree for themselves, their respective
representatives, successors and assigns, as follows:
Section 1. Definitions.
As used in this Escrow Agreement the following terms have the following
meanings:
"Eligible Securities" means noncallable, nonprepayable, obligations listed in
Exhibit B attached hereto.
"Escrow Agent" means BNY Western Trust Company, or any successor thereto
appointed under this Escrow Agreement.
"Escrow Fund" means the fund by that name created pursuant to Section 2 hereof.
"Escrowed Securities" means (i) any of those certain Eligible Securities listed in
Exhibit B to this Escrow Agreement, and (ii) any Eligible Security sold to the Escrow Agent
pursuant to the terms of the Forward Sale Agreement.
"Forward Sale Agreement"means the Escrow Fund Forward Sale Agreement
dated as of January 1, 2001 between the Escrow Agent and the Provider, in the form attached
hereto as Exhibit D.
"Provider" means
"Rating Agency(ies)" means, collectively and severally, Standard & Poor's, a
division of the McGraw-Hill Companies, Inc. and Moody's Investors Service, Inc.
"Rating Confirmation" means written confirmation from each Rating Agency to
the effect that the action or amendment proposed to be taken in connection with such Rating
Confirmation will not result in a downgrading or withdrawal of the rating on the Refunded
Bonds.
"Refunded Bonds" means a portion of the Outstanding County of Contra Costa
Taxable Pension Obligation Bonds, Series 1994.
"Refunding Bonds"means the County's Taxable Pension Obligation Bonds
Refunding Series 2001, issued pursuant to the Trust Agreement.
"Refunding Requirements" means all installments of principal and interest on the
Refunded Bonds, to and including the final date of Refunded Bonds which is June 1, 2011, as
such payments become due, as shown in Exhibit A to this Escrow Agreement.
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"State" means the State of California.
All other capitalized terms used but not defined herein shall have the respective
meanings given to such terms in the Trust Agreement.
Section 2. Creation and Purpose of Escrow.
A. There is hereby created and established with the Escrow Agent a special and
irrevocable trust fund designated as the "County of Contra Costa Taxable Pension Obligation
Bonds, 1994 Series A Escrow Fund" (the"Escrow Fund"). The Escrow Agent shall keep the
Escrow Fund separate and apart from all other funds and moneys held by it and shall hold the
Escrow Fund in trust for the purposes described herein.
B'. On the date of the delivery of the Refunding Bonds to the initial purchasers
thereof, the Trustee, pursuant to Section 14.01 of the Supplemental Trust Agreement, will
deposit with the Escrow Agent in escrow, to be held and accounted for in the Escrow Fund and
paid out as provided in this Escrow Agreement and in the Trust Agreement, moneys representing
a portion of the proceeds from the sale of the Refunding Bonds, in the amount of$
Such moneys, together with the Fee Amount of$ delivered under the Forward Sale
Agreement, shall be sufficient for the purchase of the Escrowed Securities and to make the cash
deposit to the Escrow Fund.and shall be used by the Escrow Agent (i) to purchase the Escrowed
Securities and make such cash deposit on such date, and (ii) to comply with the purchase, sale,
delivery and payment requirements of the Forward Sale Agreement. The Escrow Agent is
hereby authorized and directed to enter into the Forward Sale Agreement and to take all actions
required thereunder by the Escrow Agent.
The amount of initial cash deposit and amount of funds allocated to the purchase
of the Escrowed Securities for the Escrow Fund are as follows:
Escrow Fund:
Beginning Cash: $
Purchase of Escrowed Securities: $
The principal of and interest on the Escrowed Securities and any uninvested cash held hereunder
in each Escrow Fund shall be applied by the Escrow Agent to the payment of the Refunding
Requirements related to such Escrow Fund.
C. Except as provided in the Forward Sale Agreement, the funds held in the
Escrow Fund shall not be subject to withdrawal other than to satisfy the Refunding
Requirements.
D. The County has determined, as verified by the report of an Independent
Certified Public Accountant, dated January_, 200.1 (the "Verification Report"), that the
Escrowed Securities are such that, if interest thereon and principal thereof are paid when due, the
Docssru:471618.3 3
proceeds from the collection of such interest and principal, together with any uninvested cash
held hereunder, will be sufficient to meet the Refunding Requirements.
E. The Escrow Agent shall hold all Escrowed Securities, whether acquired as
initial investments, subsequent investments or reinvestments hereunder, and the money received
from time to time as principal and interest thereon, in trust, to secure and for the payment of the
Refunding Requirements and shall collect the principal of and interest on the Escrowed
Securities held by it hereunder promptly as such principal and interest become due, subject only
to compliance with the requirements of the Forward Sale Agreement.
Section 3. Bondholder Notices.
The Escrow Agent is hereby irrevocably instructed to mail, as soon as practicable,
a notice of the defeasance of the Refunded Bonds in the form attached hereto as Exhibit C in
accordance with Section 9.01(b) of the Original Trust Agreement.
Section 4. Accounting for Escrow: Substitutions.
A. The moneys and the Escrowed Securities from time to time accounted for in
the Escrow Fund shall not be subject to withdrawal by the County nor otherwise subject to their
order except as otherwise provided in Sections 2 and 8 hereof and in order to comply with the
requirements of the Forward Sale Agreement.
B. the County may from time to time direct the.Escrow Agent to sell, exchange
or substitute Escrowed Securities; provided that there shall be no sale, exchange or substitution
.of the Escrowed Securities, unless the following are received:.(i) the written direction of the
County, (ii) receipt by the County and the Escrow Agent of a new Verification Report, prepared
by an Independent Certified Public Accountant, verifying the sufficiency of the escrow to pay all
current interest when due on the outstandirig Refunded Bonds in full to and including their
respective maturity dates and to pay when due all maturing principal on the Refunded Bonds in
full on their respective maturity dates (taking into account the cancellation of Refunded Bonds
purchased by the County for cancellation, including Refunded Bonds placed in escrow with the
Trustee for purchase from the proceeds of the sale of Escrowed Securities), (iii) receipt of an
opinion of nationally recognized.bond counsel that such investment will not adversely affect the
validity of the Refunding Bonds or the Refunded Bonds under State law and (iv) a Rating
Confirmation. The requirements of this Section 4 shall not apply with respect to the sales from
time to time to the Escrow Agent of Qualified Eligible Securities under and pursuant to the terms
of the Forward Sale Agreement.
Section 5. Investments and Reinvestments.
Except in order to comply with the requirements of the Forward Sale Agreement,
the Escrow Agent shall have no other obligation by virtue.of this Escrow Agreement, general
trust law or otherwise, to make any investment or reinvestment of any moneys in escrow at any
time except as expressly provided in the Forward Sale Agreement or except as expressly directed
oocssrI:471618.3 4
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by the County and upon receipt,but only in case of such County direction, of(i) the written
direction of the County, (ii) receipt by the County and the Escrow Agent of a new Verification
Report, prepared by an Independent Certified Public. Accountant, verifying.the sufficiency of the
escrow to pay all current interest when due on the outstanding Refunded Bonds in full to and
including their respective maturity dates and to pay when due all maturing principal on the
Refunded Bonds in frill on their respective maturity dates (taking into account the cancellation of
Refunded Bonds purchased by the County for cancellation, including Refunded Bonds placed in
escrow with the Trustee for purchase from the proceeds of the sale of Escrowed Securities), (iii)
receipt of an opinion of nationally recognized bond counsel that such investment will not
adversely affect the validity of the Refunding Bonds or the Refunded Bonds under State law and
(IV) a Rating Confirmation.
Section 6. Sufficiency of Escrow.
Moneys deposited in the Escrow Fund, including the investment earnings thereon
and any uninvested cash, shall be in.an amount, as determined by the County, which at all times
shall be sufficient to meet the Refunding Requirements not theretofore met.
Section 7. Transfers for Payment of Refunded Bonds.
The Escrow Agent shall make from time to time such transfers to the Trustee for
the Refunded Bonds as will assure, to the extent of moneys in the Escrow Fund, the payment of
the Refunding Requirements when due, as provided herein and in the Trust Agreement.
Section 8. Termination of Escrow Agreement; Written Request of County.
When the Escrow Agent shall have transferred, pursuant to Section 7 hereof, such
moneys as are required to pay in full and discharge all of the Refunded Bonds,the Escrow
Agent, after payment of all fees and expenses of the Escrow Agent,.shall immediately pay over
to the County or its order the moneys, if any, then remaining in the Escrow Fund and shall make
forthwith a final report to the County, and this Escrow Agreement shall terminate. The Prior
Trustee shall pay to the County any and all unclaimed moneys as provided in Section 9.02 of the
Original Trust Agreement and this shall constitute the Written Request.of the County for such
purpose.
Section 9. Fees and Costs.
A. The Escrow Agent's fees, expenses and reimbursement for costs incurred for
and in carrying out the provisions of this Escrow Agreement have been fixed by separate
agreement. The Escrow Agent shall also be entitled to additional fees, expenses and
reimbursement for costs incurred, including but not limited to, legal and accounting services in
connection with any litigation or other proceedings which may at any time be instituted
involving this Escrow Agreement not due to the negligence or willful misconduct of the Escrow
Agent. Under no circumstances shall any fees, expenses or reimbursement of costs of the
DocSSF1:471618.3 5
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Escrow Agent or any other party (including without limitation, the cost of any required
Verification Report) be paid out of amounts held in the Escrow Fund.
B. Payments to the Escrow Agent pursuant to this Section 9 shall not be for
deposit in the Escrow Fund, and the fees of and the costs incurred by the Escrow Agent shall not
be a charge on and in no event shall be deducted from the Escrow Fund.
Section 10. Reports.
A. On January 1, 2002 and on July 1 and January 1 of each year thereafter until
the termination of this Escrow Agreement, the Escrow Agent shall submit to the County a report
covering all money it shall have received and all payments it shall have made or caused to be
made hereunder during the preceding six-month period, including all purchases under the
Forward Sale Agreement. Such report shall be subject to audit by the County or by such
Independent Certified Public Accountant, as may be designated by the County.
B. The last report shall be made at the time provided in'Section 8 hereof.
C. Each such report shall also list all Escrowed Securities and Qualified Eligible
Securities and the amount of money accounted for in the Escrow Fund on the day preceding the
date of such report,:except for the last report.
Section 11. Character of Deposit.
A. It is recognized that title to the Escrowed Securities and moneys accounted for
in the Escrow Fund from time to time be vested in the Escrow Agent but subject always to the
prior trust, charge and lien thereon of this Escrow Agreement in favor of the owners of the
Refunded Bonds and the use thereof required to be made by the provisions hereof.
B. The Escrow Agent shall hold all such securities and moneys in the Escrow
Fund as special trust funds separate and wholly segregated from all other securities and funds of
the Escrow Agent or deposited therein, and shall never commingle such securities or moneys
with other securities or moneys.
C. No money paid into and accounted for in the Escrow Fund shall ever be
considered as a banking deposit and the Escrow Agent shall have no right or title with respect
thereto except in its capacity as Escrow Agent hereunder.
Section 12. Exculpatory Provisions.
A. The duties and responsibilities of the Escrow Agent are limited to those
expressly and specifically stated in this Escrow Agreement.
B: The Escrow Agent shall not be liable or responsible for any loss resulting from
any investment or reinvestment made pursuant to this Escrow Agreement and made in
DOCSSFI:471618.3 6
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compliance with the provisions hereof. The Escrow Agent shall not be liable or responsible for
the accuracy of any calculations or the sufficiency of any Escrowed Securities, the Escrow Fund
or any moneys held by it to meet the Refunding Requirements.
C. No provision of this Escrow Agreement shall be construed to relieve the
Escrow Agent from liability for its own negligent failure to act or its own willful misconduct.
D. The Escrow Agent shall be. under no obligation to inquire.into or be in any
way responsible for the performance or nonperformance by the County of any of its obligations,
nor shall it be responsible in any manner for the recitals or statements contained herein or in the
Refunded Bonds or any proceedings taken in connection therewith, such recitals and statements
being made solely by the County. The Escrow Agent may conclusively rely on any opinion,
written request, certificate, written direction or report of the County, any certified public
accountant, financial advisor or investment bank delivered to it and received in good faith in
connection with the transactions contemplated hereby and by the Forward Sale .Agreement.
E. Nothing in this agreement shall be construed to create any obligations or
liabilities on the part of the Escrow Agent to anyone other than the County, the holders of the
Refunded Bonds and the Provider.
F. The Escrow Agent may at any time resign by giving thirty (30) days written
notice to the County of such resignation. .The County shall promptly appoint a successor Escrow
Agent by the resignation.date. Resignation of the Escrow Agent will be effective only upon
acceptance of appointment by a successor Escrow Agent. If the County does not appoint a
successor, the Escrow Agent may petition any court of competent jurisdiction for the
appointment of a successor Escrow Agent, 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 Escrow
Agent. After receiving a notice of resignation of an Escrow Agent, the County may appoint a
temporary Escrow Agent to replace the resigning Escrow Agent until the County appoints a
successor Escrow Agent. Any such temporary Escrow Agent so appointed by the County shall
immediately and without further act be superseded by the successor Escrow Agent so appointed..
G. The County, to the extent permitted by law, agrees to indemnify the Escrow
Agent, its agents and its officers or employees for and hold the Escrow Agent, its agents, officers
or employees harmless from and against any and all liabilities, obligations, losses, damages,
penalties, actions,judgments, suits, claims, costs, expenses and disbursements of any kind or
nature whatsoever(including, without limitation, reasonable fees and disbursements of counsel
for the Escrow Agent) which may be imposed on, incurred by, or asserted against the Escrow .
Agent at any time by reason of the performance of its duties as Escrow Agent hereunder, in any
transaction.arising out of this Escrow Agreement, the Forward Sale Agreement or the Trust
Agreement or any of the transactions contemplated herein or in the Trust Agreement, unless due
.to the Escrow Agent's or its officers' or employees' or agents' negligence or willful misconduct.
Such indemnity shall survive the termination of this Escrow Agreement or resignation of the
Escrow Agent.
DOCSSr1:471618.3 7
H. The Escrow Agent may consult with counsel, who may be counsel of or to the
County, with regard to legal questions and the opinion of such counsel shall be full and complete.
authorization in respect of any action taken or suffered by it hereunder in good faith and in
accordance therewith.
Section 13. Time of Essence.
Time shall be of the essence in the performance of the obligations from time to
time imposed upon the Escrow Agent by this Escrow Agreement.
Section 14. Amendments.
This Escrow Agreement may not be revoked or amended by the parties hereto
unless there.shall first have been filed with the County and the Escrow Agent (i) a written
opinion of nationally recognized bond counsel stating that such amendment will not adversely
affect the validity of the Refunded Bonds or the Refunding Bonds under State law, (ii) a Rating
Confirmation and (iii) unless such amendment is not materially adverse to the interests of the
registered owners of the Refunded Bonds, the written consent of all the owners of the Refunded
Bonds then outstanding. Notice of any amendment to this Escrow Agreement shall be delivered
by the Escrow Agent to the Rating Agencies.
Section 15. Successors.
A. Whenever herein the County or the Escrow Agent is named or is referred to,
such provision shall be deemed to include any successor of the County or the Escrow Agent,
respectively, immediate or intermediate, whether so expressed or not. The Rating Agencies shall
be provided with notice of any change to the Escrow Agent.
B. All of the stipulations, obligations and agreements by or on behalf of, and
other provisions for the benefit of, the County or the Escrow Agent contained herein:
(1) Shall bind and inure to the benefit of any such successor; and
(2) Shall bind and shall inure to the benefit of any officer, board,
authority, agent or instrumentality to whom or to which there shall be transferred by or in
accordance with law any right, power or duty of the County or the Escrow Agent,
respectively, or of its successor.
Section 16. Notices..
All notices and communications hereunder shall be in writing and shall be
deemed to be duly given if received or sent by first class mail to the following addresses or to
such other.address as the recipient thereof shall request in.writing to the other party hereto:
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If to the County: County of Contra Costa
County Administrator's Office
651 Pine Street
Martinez, California 94553-0063
If to the Escrow Agent: BNY Western Trust Company
700 S. Flower St, Suite 500
Los Angeles, CA 90017
Attn: Corporate Trust
If to the Rating Agencies: Standard&Poor's
55 Water Street, 38th Floor
New York, NY 10041
Attn: Municipal Structured Group
Moody's Investors Service
99 Church Street, 9th Floor
New York,NY 10007
Attn: Anthony Plank
Section 17. Severability.
If any section, paragraph, clause or provision of this Escrow Agreement shall for
any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such
section, paragraph, clause or provision shall not affect any of the remaining provisions of this
Escrow Agreement. The Rating Agencies shall be notified of any determination of
unenforceability or invalidity of any portion of this Escrow Agreement.
Section 18. Law Governing.
This Escrow Agreement is made in the State of California and is to be construed
under the Constitution and laws of such State.
Section 19. Counterparts.
This Escrow Agreement may be executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same instrument.
DOCSSF1:471618.3 9
IN WITNESS WHEREOF, the COUNTY OF CONTRA COSTA has caused this
Escrow Agreement to be signed in its name by its duly authorized officer, and BNY WESTERN
COMPANY, has caused this Escrow Agreement to be signed in its name by its duly authorized
officer, all as of the day and year first above written.
COUNTY OF.CONTRA COSTA
By:
Chair of the Board of Supervisors
ATTEST:
Clerk of the Board of Supervisors
BNY WESTERN TRUST COMPANY,
as Escrow Agent
By:
Authorized Officer
DOCSSPI: 7.1618.3
EXHIBIT A
REFUNDING REQUIREMENTS
Period Interest Principal
Ending Due Due Total
Total
DOCSSF1:471618.3 A-1
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EXHIBIT B
ESCROWED SECURITIES
The following securities will be deposited into the Escrow Fund on January 2001:
Initial Cash Deposit: $
Issue Maturity Coupon Par Price Total Money CLSIP
Docssr1:471618.3 B-1
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EXHIBIT C
NOTICE OF DEFEASANCE
Notice to the Holders of Outstanding
County of Contra Costa
Taxable Pension Obligation Bonds,
1994 Series A
CUSIP#
NOTICE IS HEREBY GIVEN that the COUNTY OF CONTRA COSTA (the
"County") has on January_, 2001, from the proceeds of the sale of pension obligation general
fund bonds [and other sources], irrevocably set aside in an Escrow Fund created for such purpose
and held by BNY Western Trust Company, moneys which the County has determined, when
added to the investment earnings therefrom, shall be sufficient to pay the principal of and interest
on the outstanding bonds referenced above (the "Bonds"), as such payments become due up to
and including June 1, 2011, the final maturity for the Bonds.
The moneys so deposited in escrow (including the earnings derived from the
investment thereof) are irrevocably pledged to the payment of principal, premium and interest on
the outstanding Bonds. Said moneys have been invested in permitted investments pursuant to
the Trust Agreement defined in the next paragraph, which result in.the assignment of"AAA" and
"Aaa" ratings to the Bonds by Standard & Poor's, a division of the McGraw-Hill Companies,
Inc. and Moody's Investors Service Inc., respectively,and the first supplement thereto dated as
of January 1, 2001 (the "First Supplement").and which bear interest and mature on such dates as
to insure the payment of interest on the outstanding Bonds as such interest becomes due and to
pay the principal on the Bonds on each maturity date therefor, to and including the final maturity
date of June 1, 2011.
As a consequence of the foregoing actions and in accordance with the Trust
Agreement;dated as of February 1, 1994 as amended by the First Supplement (collectively the
"Trust Agreement"), between the County and BNY Western Trust Company, as trustee (the
"Trustee"), providing for the Bonds, the Bonds are deemed paid in accordance with Section 9.01
of the Trust Agreement.
Additional information regarding the foregoing actions may be obtained from
BNY Western Company.
DOCSSF1:471 6 u s.3 C-I
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EXHIBIT D
ESCROW FUND FORWARD SALE AGREEMENT
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EXHIBIT E
ELIGIBLE SECURITIES
[insert revised list of permitted defeasance securities asset forth in Exhibit B to the First
Supplemental Trust Agreement]
No other securities or investments not specifically described above (including without
limitation unit investment trusts and mutual funds) may be considered "Eligible Securities"
hereunder.
DOCSSFI-471618.3
PRELIMINARY OFFICIAL STATEMENT DATED ;' ,2001
NEW ISSUE—BOOK-ENTRY ONLY RATINGS:
TAXABLE(FEDERAL),TAX-EXEMPT(CALIFORNIA) See"RATINGS" herein
In the opinion of Orrick, Herrington & Sutcliffe LLP, Bond Counsel, based upon existing laws, regulations, rulings and court
decisions, interest on the 2001 Bonds is exempt from State of California personal income taxes. Interest on the 2001 Bonds is not
excludable front gross income for federal income tax purposes. Bond Counsel expresses no opinion regarding any other tax
consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the 2001 Bonds. See "TAX MATTERS"
herein.
COUNTY OF CONTRA COSTA, CALIFORNIA
[SEAL] TAXABLE PENSION OBLIGATION BONDS,
REFUNDING SERIES 2001
Dated: Date of Delivery Price: 100% Due: June 1, 2014
The County of Contra Costa, California Taxable Pension Obligation Bonds, Refunding Series 2001 (the "2001 Bonds") are
being issued to purchase and cancel, pursuant to a tender offer program, and/or refunding, a portion of the County of Contra Costa,
California Taxable Pension Obligation Bonds, 1994 Series A (the "1994 Bonds") and to pay the costs of issuance relating to the 2001
Bonds. See"PLAN OF REFUNDING"and"ESTIMATED SOURCES AND USES OF FUNDS"herein.
The 2001 Bonds will be issued pursuant to the Trust Agreement, dated as of February 1, 1994, between the County of Contra
Costa, California(the "County") and BNY Western Trust Company, as successor trustee (the "Trustee"), as supplemented by the First
Supplemental Trust Agreement, dated as of December 1,2000,between the County and the Trustee(together,the"Trust Agreement").
The 2001 Bonds will be absolute and unconditional obligations imposed upon the County by law. The 2001 Bonds will be payable on a
parity basis with the 1994 Bonds and will not be limited as to payment to any special source of funds of the County.
The 2001 Bonds will be issued as fully registered bonds and, when issued, will be registered in the name of Cede & Co., as
nominee of The Depository Trust Company,New York, New York("DTC"). DTC will act as securities depository of the 2001 Bonds.
Individual purchases of 2001 Bonds will be made in book-entry form only. Payments of principal of, premium, if any, and interest on
the 2001 Bonds are to be made to purchasers by DTC through DTC Participants. Purchasers will not receive physical delivery of the
2001 Bonds purchased by them. See"DESCRIPTION OF THE 2001 BONDS—Book-Entry System"herein.
The 2001 Bonds will be issued initially in denominations of$100,000 and any integral multiple of$5,000 in excess thereof.
The 2001 Bonds will be dated the date of initial issuance and delivery, and interest thereon will accrue initially at a Weekly Rate. The
first interest payment date for the 2001 Bonds will be _,2001*.
The 2001 Bonds are subject to redemption prior to maturity as described herein.
The 2001 Bonds are subject to mandatory tender upon certain events as described herein. While in certain interest rate modes,
the 2001 Bonds may be purchased upon the demand of the beneficial owner thereof at a price equal to the principal amount thereof plus
accrued interest. The purchase price of the 2001 Bonds is payable from the proceeds of remarketing of such 2001 Bonds, and, to the
extent remarketing proceeds are unavailable, from amounts available under a Standby Bond Purchase Agreement,dated as of January 1,
2001 (the "Liquidity Facility"), between the County and.Westdeutsche Landesbank Girozentrale, acting through its New York Branch
(the "Bank"). The obligation of the Bank to purchase tendered but unremarketed 2001 Bonds is subject to suspension or termination
upon the occurrence of certain events. Unless extended or terminated, the Liquidity Facility will expire on See
"DESCRIPTION OF THE 2001 BONDS,""THE LIQUIDITY FACILITY"and"THE BANK"herein.
THE 2001 BONDS DO NOT CONSTITUTE AN OBLIGATION OF THE COUNTY FOR WHICH THE COUNTY IS
OBLIGATED TO LEVY OR PLEDGE ANY FORM OF TAXATION. NEITHER THE 2001 BONDS NOR THE OBLIGATION OF
THE COUNTY TO MAKE PAYMENTS WITH RESPECT TO THE 2001 BONDS CONSTITUTES A DEBT OR AN
INDEBTEDNESS OF THE COUNTY, THE STATE OF CALIFORNIA, OR ANY OF ITS POLITICAL SUBDIVISIONS WITHIN
THE MEANING OF ANY CONSTITUTIONAL OR STATUTORY DEBT LIMITATION OR RESTRICTION.
The 2001 Bonds are offered-when, as and if issued and received by the Underwriter, and subject to the approval of validity by
Orrick, Herrington & Sutcliffe LLP, Bond Counsel, and certain other conditions. C.M. de Crinis &Co., Inc. is serving as Financial
Advisor to the County in connection with the issuance of the 2001 Bonds. Certain legal matters will be passed upon for the County by
County Counsel,.for the Underwriter by its counsel, Fulbright & Jaworski L.L.P., Los Angeles, California, and for.the Bank by its
counsel, Winston & Strawn,New York,New York. It is expected that the 2001 Bonds will be available for delivery through the DTC
book-entry system on or about February_,2001.
BEAR, STEARNS & CO. INC.
THIS COVER PAGE CONTAINS INFORMATION FOR REFERENCE ONLY. IT IS NOT A SUMMARY OF THIS
TRANSACTION. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATION ESSENTIAL
TO MAKE AN INFORMED INVESTMENT DECISION.
Dated: February,_,2001
*Preliminary,subject to change
10021499/594236.4 w97
No dealer, broker, •salesperson or other person has been authorized by the County of Contra
Costa, California (the "County") or the Underwriter to give any information or to make any
representations, other than as contained in this Official Statement, and if given or.made such other
information or representations must not be relied upon'as having been authorized by the County or the
Underwriter. This Official Statement does not constitute an offer to sell or the solicitationof an offer to
buy, nor shall there be any sale of the 2001 Bonds by any person in any jurisdiction in which it is
unlawful for such persons to make such offer, solicitation or sale.
This Official Statement is not to be construed as a contract with the purchasers of the 2001
Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of
opinion, whether or not expressly described herein, are intended solely as such and are not to be construed
as representations of fact.
The information set forth herein has been furnished by the County, and includes information
obtained from other sources which are believed to be reliable. The information and expressions of
opinion contained herein are subject to change without notice and neither the delivery of this Official
Statement nor any sale made hereunder shall, under any circumstances, create any implication that there
has been no change in the affairs of the County since the date hereof.
The Underwriter has provided the following sentence for inclusion in this Official Statement:
The Underwriter has reviewed the information in this Official Statement in accordance with, and as part
of, its responsibilities to investors under the federal securities laws as applied to the facts and
circumstances of this transaction,but the Underwriter does not guarantee the accuracy or completeness of
such information.
IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE COUNTY AND THE TERMS OF THE OFFERING, INCLUDING THE
MERITS AND RISKS INVOLVED. THE 2001 BONDS HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS OFFICIAL STATEMENT.
IN CONNECTION WITH THE OFFERING OF THE 2001 BONDS, THE UNDERWRITER
MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE.
MARKET PRICE OF THE 2001 BONDS AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE
PREVAIL IN THE OPEN MARKET.. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
Certain statements included or incorporated by reference in this Official Statement constitute
"forward-looking statements." Such statements are generally identifiable by the terminology used such as
"Plan," "project;" "expect," "anticipate," "intend," "believe," "estimate," "budget" or other similar words.
The achievement of certain results or other expectations contained in such forward-looking statements
involve known and unknown risks, uncertainties and other factors that may cause actual results,
performance or achievements described to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. The County does not plan to
issue any updates or revisions to those forward-looking statements if or when its expectations are met or
events, conditions or circumstances on which such statements are based occur.
10021499/594236.4 w97
COUNTY OF CONTRA COSTA, CALIFORNIA
BOARD OF SUPERVISORS .
Donna Gerber
(District 3)
Chair
John Gioia Gayle B. Uilkema
(District 1) (District 2)
(Vice-Chair)
Mark DeSaulmer Joe Canciamilla
(District 4) (District 5)
COUNTY OFFICIALS
Philip J. Batchelor
Clerk of the Board and
County.Administrator
Laura W. Lockwood
Director, Capital Facilities and Debt Management
Kenneth J. Corcoran William J. Pollacek
Auditor-Controller Treasurer-Tax Collector
Victor J. Westman Stephen L. Weir
County Counsel County Clerk-Recorder
BOND COUNSEL FINANCIAL ADVISOR
Orrick, Herrington & Sutcliffe LLP C.M. de Crinis & Co., Inc.
San Francisco, California Sausalito, California
.UNDERWRITER'S COUNSEL
Fulbright &Jaworski L.L.P.
Los Angeles, California
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TABLE OF CONTENTS
Page
SUMMARYSTATEMENT......................................................................................................................I
The County of Contra Costa, California........................................................................................i
The 2001 Bonds; Purpose of the Issue...........................................................................................i
Security and Source of Payment for the 2001 Bonds...........................................'........................ii
Bond Registration and Book-Entry System..................................................................................ii
Redemption of 2001 Bonds; Mandatory Tender of 2001 Bonds..................................................ii
INTRODUCTORY STATEMENT.......................................................................................................... 1
DESCRIPTION OF THE 2001 BONDS..................................................................................................2
General..........................................................................................................................................2
Intereston the 2001 Bonds ...........................................................................................................3
Optional Tender for Purchase of 2001 Bonds...............................................................................5
Mandatory Purchase of 2001 Bonds.............................................................................................6
Payment of Purchase Price............................................................................................................6
Redemption of the 2001 Bonds..............:.......................................................................................8
Book-Entry.System........................................................................................................................9
PLAN OF REFUNDING........................................................................................................................ 1.1
THE LIQUIDITY FACILITY................................................................................................................ 1.1
THEBANK ............................................................................................................................................ 12
Background Information.............................................................................................................. 1.2
TheNew York Branch................................................................................................................ 13
Summary of Results of Operations and Financial Condition fore the Fiscal Year Ended
December31, 1999.........................................................................................................13
United States and German Exchange Rates, and Generally Accepted Accounting
Principles.........................................................................................................................13
SECURITY AND SOURCE OF PAYMENT FOR THE 2001 BONDS............................................... 14
Obligation Imposed by Law; Deposits to Trustee ......................................................................14
Interest Reserve Account............................................................................................................ 15
ESTIMATED SOURCES.AND USES OF FUNDS ..............................................................................15
,DEBT SERVICE REQUIREMENTS.....................................................................................................16
COUNTY INFORMATION................................................................................................................... 17
CONSTITUTIONAL AND STATUTORY LIMITATIONS ON TAXES, REVENUES AND
APPROPRIATIONS................................................................................................................... 17
Article XIII A of the California Constitution ............................................................................. 17
Legislation Implementing Article XIII A................................................................................... 17
Article XIII B of the California Constitution.............................................................................. 18
Article XIII C and Article XIII D of the California Constitution............................................... 18
Proposition62............................................................................................................................. 19
Proposition187...........................................................................................................................20
Future Initiatives and Changes of Law.......................................................................................21
Limitations on Remedies ............................................................................................................21
TAXMATTERS.....................................................................................................................................22
APPROVAL OF LEGALITY.................................................................................................................22
ValidationProceedings................................................................................................................22
Opinionsof Counsel ...................................................................................................................22
LITIGATION..........................................................................................................................................23
RATINGS...............................................................................................................................................23
UNDERWRITING .................................................................................................................................23
VERIFICATION OF MATHEMATICAL COMPUTATIONS.............................................................23
ADDITIONAL INFORMATION...........................................................................................................24
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Si7. G
Table of Contents - Contimled
Page
APPENDIX A-GENERAL COUNTY ECONOMIC AND DEMOGRAPHIC
INFORMATION...........................................................................................................................A-1
APPENDIX B -COUNTY FINANCIAL INFORMATION....................................................................B-1
APPENDIX C -AUDITED FINANCIAL STATEMENTS OF THE COUNTY
FOR THE FISCAL YEAR ENDED JUNE 30, 2000 ..................................................................0-1
APPENDIX D- SUMMARY OF CERTAIN PROVISIONS OF THE TRUST
AGREEMENT.............................................................................................................................D-1
APPENDIX E -PROPOSED FORM OF BOND COUNSEL OPINION.................................................E-1
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SID. y
SUMMARY STATEMENT
This Summary Statement is subject in all respects to the more complete information
contained in this Official Statement, and the offering of the County of Contra Costa, California
Taxable Pension Obligation Bonds, Refunding Series 2001 to potential purchasers is made only
by means of the entire Official Statement.
The County of Contra Costa, California
The County of Contra Costa, California (the "County") was incorporated in 1850 as one
of the original 27 counties of the State of California. The County lies northeast of San Francisco
and is the ninth most populous county in California. The County seat is in the City. of Martinez.
Major industries in the County include petroleum refining, telecommunications, financial and
retail services, steel manufacturing, prefabricated metals, chemicals, electronic equipment, paper
products and food processing. For the fiscal year ended June 30, 2000, the County's General
Fund budget totaled approximately$888.2 million.
The 2001 Bonds; Purpose of the Issue
The County Employees Retirement Law of 1937, California Government Code Sections
31450 et seq. (the "Retirement Law") obligates the County (i) to appropriate, annual
contributions' to the Contra Costa County Employees' Retirement Association (the
"Association") to fund pension benefits for its employees and (ii) to amortize the then current
unfunded accrued actuarial liability with respect to such pension benefits. In 1994, the County
issued a debenture (the "Debenture") to the Association as evidence of the County's obligations
to the Association. Also in 1994, the County issued $337,365,000. of its Taxable Pension
Obligation Bonds, 1994 Series A (the "1994 Bonds") pursuant to a trust agreement, dated as of
February 1, 1994 (the "Original Trust Agreement"), to refund the Debenture and to provide a
payment obligation with an effective interest rate lower than the rate charged to the County on its
then current unfunded accrued actuarial liability.
The County of Contra Costa, California Taxable Pension Obligation Bonds, Refunding
Series 2001 (the "2001 Bonds," and together with the'1994 Bonds, the "Bonds") are being issued
to purchase and cancel, pursuant to a tender offer program, and/or refund, a portion of the 1994
Bonds and to pay the costs of issuance relating to the 2001 Bonds. .The County believes that by
purchasing and/or refunding a portion of the 1994 Bonds, it may be able to reduce its debt
service costs prior to the final maturity of the 1994 Bonds on June 1, 2011. In addition, the
County intends to restructure the amortization schedule of the Bonds (including the 2001 Bonds)
so that the final maturity of the Bonds occurs on June 1, 2014.
The 2001 Bonds are being issued pursuant to the Original Trust Agreement and the First
Supplemental Trust Agreement thereto, dated as of December 1, 2000.(together with the Original
Trust Agreement, the "Trust Agreement"), between the County and BNY Western Trust
Company, as trustee (the "Trustee"). The 2001 Bonds will be payable on a parity with the 1994
Bonds and any Additional Bonds (as defined in Appendix D attached hereto) hereafter issued by
the County. Issuance of the 2001 Bonds was approved by a resolution of the Board of
Supervisors of the County (the "Board of Supervisors") adopted on November 14, 2000.
10021499/594236.4 w97
The 2001 Bonds will be issued initially in denominations of $100,000 and any integral
multiple of$5,000 in excess thereof. The 2001 Bonds will be dated the date of initial issuance
and delivery,,and interest thereon will accrue initially at a Weekly Rate.
Security and Source of Payment for the 2001 Bonds
The obligation of the County to make payments with respect to the 2001 Bonds is an
absolute and unconditional obligation of the County imposed upon the County by law and
enforceable against the County pursuant to the Retirement Law. Payment of principal of,
premium, if any, and interest on the 2001 Bonds is not limited to any special source of finds.
The Trust Agreement provides that the County is obligated to deposit or cause to be
deposited with the Trustee the amount which, together with any amounts transferred from the
Surplus Account, will be sufficient to.pay the County's obligations on the Bonds for each fiscal
year within 30 days of the commencement of such fiscal year. Pursuant to. the Retirement Law,
the Board of Supervisors is obligated to make appropriations to pay the unfunded accrued
actuarial liability which is evidenced by the Bonds. In the event the Board of Supervisors fails or
neglects to make appropriations and transfers in respect of its obligation to. pay the Bonds, the
Retirement Law requires that the County Auditor transfer from any money available in any fund
in the County treasury amounts necessary to.make such payments, with such transfer having the
same force and effect as an appropriation by the Board of Supervisors. No assurance can be
given as to the amount and source of funds available in the County treasury for such transfer at
any particular time.
THE 2001 BONDS DO NOT CONSTITUTE AN OBLIGATION OF THE COUNTY
FOR WHICH THE COUNTY IS OBLIGATED. TO LEVY OR PLEDGE ANY FORM OF
TAXATION. NEITHER THE 2001 BONDS NOR THE OBLIGATION OF THE COUNTY TO
MAKE PAYMENTS WITH RESPECT. TO THE 2001 BONDS CONSTITUTES A DEBT OR
AN INDEBTEDNESS OF THE COUNTY, THE STATE OF CALIFORNIA, OR ANY OF ITS
POLITICAL SUBDIVISIONS. WITHIN THE MEANING OF ANY CONSTITUTIONAL OR
STATUTORY DEBT LIMITATION OR RESTRICTION.
Bond Registration and Book-Entry.System
The 2001 Bonds will be issued as fully registered bonds and, when issued, will be
registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York,
New York ("DTC"), DTC will act as securities depository of the 2001 Bonds. Individual
purchases of 2001 Bonds will be made in book-entry form only. Payments of principal of,
premium, if any, and interest on the 2001 Bonds are to be made to purchasers by DTC through
DTC participants. Purchasers will not receive physical delivery of the 2001 Bonds purchased by
r them.
Redemption of 2001.Bonds; Mandatory Tender of 2001 Bonds
The 2001 Bonds are subject to optional redemption and mandatory sinking fund
redemption prior to maturity as described herein.
10021499/594236.4 w97 11
S 1J•
Z-6-ol
The 2001 Bonds are subject to mandatory tender upon certain events as described herein.
While in certain interest rate modes, the 2001 Bonds may be purchased upon the demand of the
beneficial owner thereof at a price equal to the principal amount thereof plus accrued interest.
The purchase price of the 2001 Bonds is payable from the proceeds of remarketing of such 2001
Bonds and, to the extent remarketing proceeds are unavailable, from amounts available under the
Standby Bond Purchase Agreement, dated as of January 1, 2001 (the "Liquidity Facility"),
between the County and Westdeutsche Landesbank Girozentrale, acting through its New York
Branch (the "Bank"). The obligation of the Bank to purchase tendered but unremarketed 2001
Bonds is subject to suspension or termination upon the occurrence of certain events.
10021499/594236.4 w97 in