Loading...
HomeMy WebLinkAbout88-068RESOLUTION $$- 068 Introduced By: Seconded By: RESOLUTION OF THE BOARD OF SUPERVISORS OF COUNTY OF BUTTE, AUTHORIZING THE ISSUANCE OF TA% AND REVENUE ANTICIPATION NOTES TO PAY 19$8/1983 OPERATING EXPENSES AND OTHER OBLIGATIONS DF THE COUNTY, PROVIDING FOR THE PAYMENT OF SUCH NOTES, AND MAKING OTHER DETERMINATIONS IN CONNNECTION THEREWITH. Recitals WHEREAS pursuant to Article 7.6, Chapter 4, Part 1, Division 2, Title 5 of the Government Code of the State of California {the "Government Code"}, the County of Butte, California (the "County"), is authorized to {i) issue tax and revenue anticipation notes the proceeds of which will be used and expended for certain purposes, including current operating expenses, prior to the receipt of certain anticipated revenues, and (ii} pledge certain moneys to be received by the County for the payment of such notes and the interest thereon; and WHEREAS, pursuant to Article 3, Chapter 9, Part 2~, Division 3, Title 2 of the Education Code of the State of California (the "Education Code"} the County is required to advance from certain County funds amounts needed by the school districts of the County to meet their current expenses of maintenance prior to the. receipt by such school districts of the first revenues accruing during the fiscal year, which first revenues will. be applied to replenish such County funds so (1) advanced, and such advances by the County constitute obligations for which the proceeds of its tax and revenue anticipation notes may be expended; and WHEREAS, the County presently anticipates issuing tax and revenue anticipation notes for such purposes for its 1988/1989 fiscal year; NOW,•THEREFOR, BE IT RESOLVED, BY THE BOARD OF SUPERVISORS OF THE COUNTY OF BUTTE by the favorable vote of not less than a majority of all the members of said Board, AS FOLLOWS: Section 1. Tax and Revenue Anticipation Notes {the "Notes") of the County in a principal amount not to exceed $3,150,000 are hereby authorized to be issued to pay current operating expenses and other obligations for the 1988/19$9 fiscal year of the County in anticipation of the receipt of revenues anticipated to be received in such fiscal year. Said Notes shall be dated on or after July 1, 1988 and shall mature, without option of prior redemption, not more than one year from their dated date. The Notes shall be designated "Tax and Revenue Anticipation Notes-1988/1989", sha11 be numbered consecutively from one (1) upwards, and shall be in denominations of $5,000 or integral multiples thereof. The Notes shall bear interest from their date at a fixed rate of interest as to be hereafter determined. Both the principal of and interest on the Notes shall be payable at maturity, upon the surrender thereof, in lawful money of the United States of America, at the principal {2) corporate trust office of Security Pacific National Trust Company (New York) New York, New York {the "Paying Agent"). Said Notes shall be issued in bearer form without coupons, and shall not be registrable as to either principal or interest, and shall be in substantially the form attached hereto as Appendix A and hereby made a part hereof. • Section 2. The Notes shall be issued in anticipation of the receipt of unrestricted moneys to be received or accrued during the County's 1988/1989 fiscal year, including taxes, income, revenues, cash receipts, and other moneys intended as receipts for the General Fund and other unrestricted funds of the County and which are generally available for the payment of current expenses and other obligations of the County {the "Unrestricted Moneys"), As of the date hereof, the County has not received any of the Unrestricted Moneys hereinabove described, and has not pledged any of said Unrestricted Moneys to the payment of any notes, bonds, certificates or other obligations of the County, Section 3. The County hereby pledges to the payment of the principal of the Notes the Unrestricted Moneys expected to be received as follows: the first $787,500 thereof in February, 1969; the first $787,500 thereof in March, 1989; the first $787,500 thereof in April, 19$9; and the first $787,500 thereof in May, 1989. The County hereby pledges to the payment of the interest on the Notes the amount necessary to pay such interest from the first $378,000 of Unrestricted Moneys to be received in {3) June, 1989 {all of said portions of the Unrestricted Moneys pledged to pay the principal of and interest on the Notes hereinafter referred to as the "Pledged Revenues"). In the event that Notes in an amount less than $3,150,000 are issued, the amount of Pledged Revenues as designated herein for each of the months of February, 19$9 through May, 1989, inclusive, shall be reduced equally. The principal of the Notes and the interest thereon shall constitute a first lien and charge against the Pledged Revenues and shall be payable from the first moneys received by the County from such Pledged Revenues. All of said Pledged Revenues as and when received shall be subject to such lien and charge. Said Notes shall be general obligations of the County and, to the extent not paid from the Pledged Revenues, shall be paid with interest thereon from any other moneys of the County lawfully available therefor. Each Note shall be secured by the Pledged Revenues ratably according to the amount of principal and interest due thereon. Section 4. All Pledged Revenues as and when received and any other lawfully available funds of the County as appropriated or allocated for the payment of the Notes, shall be deposited by the County in a special fund to be applied only to the payment of the Notes and the interest thereon. Such fund is hereby established and designated: "Tax and Revenue Anticipation Note-1986/1989 Payment Fund" {the "Note Payment Fund" or the "Fund"}. In the event that in any of the months from February, 1989 to June, 19$9, the Pledged Revenues received by the County (4) are insufficient to permit deposit into the Note Payment Fund of the full amount of Pledged Revenues required to be deposited in such month, then the amount of any deficiency in such deposit shall be satisfied and made up by the last business day of such month, from any other moneys of the County lawfully available for the payment of the Notes and interest thereon. The Fund will be held by and maintained with the Treasurer-Tax Collector of the County, in Oroville, California. All Pledged Revenues and any other moneys or investments deposited in the Fund shall be held in trust for the benefit of the holders of the Notes, and shall be applied only upon the maturity of the Notes to pay the principal thereof and the interest thereon. Moneys deposited in the Fund may not be used for any other purpose. Moneys in the Fund may be invested at the direction of the County in the following investments provided such investments mature at such times and in such principal amounts as to permit the timely disbursement from the Fund as herein provided. Any investment securities deposited in the fund must meet all the requirements for investment securities purchased with moneys in the Fund and, in addition, at the time of their deposit must have a market value equal to at least 100 of their stated par value. (a} United States Treasury notes, bonds, bills or certificates of indebtedness, or those for which the faith and credit of the United States are pledged for the payment of principal and interest. (5} {b) Obligations issued by banks for cooperatives, federal land banks, federal intermediate credit banks, federal home loan banks, the Federal Home Laan Bank Board, the Tennessee Valley Authority, or in obligations, participations or other instruments of or issued by, the Federal National Mortgage Association; or in guaranteed portions of Small Business Administration notes; or in obligations, participations, or other instruments of or issued by a federal agency or a United States government-sponsored enterprise. (c) $i11s of exchange or time drafts drawn on and accepted by a commercial bank, otherwise known as bankers' acceptances, which are eligible for purchase by the Federal Reserve System. Purchases of bankers' acceptances may not exceed 270 days' maturity or g0~ of the moneys deposited in the Fund which may be invested. No more than 30~ of such funds may be invested in the bankers' acceptances of any one commercial bank. {d} Investments in repurchase agreements provided that each such repurchase agreement {i) is acceptable in form to the Treasurer-Tax Collector, (ii} provides that such agreement constitutes a purchase and sale of securities and is not a loan of funds by the County, (iii) provides for the physical transfer of certificated United States Government Obligations to the custody of the Treasurer- Tax Collector or to a custodial account in the name of {5) the Treasurer-Tax Collector with the Federal Reserve Bank in San Francisco and for the registration of title to "book entry" United States Government Obligations to the Treasurer-Tax Collector in the Federal Reserve Bank in San Francisco, (iv} provides that United States Government Obligations acquired pursuant to such repurchase agreements shall be valued at least quarterly at the lower of the then current market value thereof or the repurchase price thereof set forth in the applicable repurchase agreement, (v} is with any state or national bank with a rating on short-term obligations of P-1 or better from Moody's Investors Service and A-1 or better from Standard & Poor's Corporation, and (vi} provides that the Treasurer-Tax Collector may sell the related obligations if the other party to the applicable repurchase agreement shall fail to promptly repurchase such obligation on the day required by the repurchase agreement. The term "Repurchase Agreement" means a purchase of securities by the Treasurer-Tax Collector pursuant to an agreement by which the seller will repurchase such securities on or before a specified date, or on the demand of either party, and for a . specified amount. Such securities shall mean securities of the same issuer, description, issue date and maturity. (7) (e) Certificates of deposit issued by a nationally or state-chartered bank provided that such certificates of deposit shall be (i) continuously and fully insured by the Federal Deposit Insurance Corporation or (ii) continuously and fully secured by such securities as are described above in clauses {a) and (b), which shall have a market value (exclusive of accrued interest) determined weekly of at least 11Q~ of the principal amount of such certificates of deposit or (iii) continously and fully secured by securities as described in Section 53651(m) of the Government Code. At such time when the amount in the Fund is sufficient to pay all principal and interest on the Notes at maturity, the County shall not be required to make any further deposits therein, and any excesses may be withdrawn from the Fund and applied by the County for any lawful purpose. Section 5. The principal amount of the Notes, together with the principal amount of all other notes of the County issued in the 1988/1989 fiscal year of the County, pursuant to Article 7.6, Chapter 4, Part 1, Division 2, Title 5 of the Code, will not exceed B5~ of the estimated amount of the uncollected income, revenue, cash receipts, and other moneys of the County which will be available for the payment of all of the Notes, and the interest thereon. Section 6. The proceeds of the Notes shall be deposited in the County's General Fund, and may be expended for (8) the purposes for which the Pledged Revenues are to be received, including, but not limited to, advances to the school districts of the County. The amounts of such advances to each school district will be repaid to the County from the first revenues accruing to such school district after such advance is made during the 1988/1989 fiscal year. Section 7. The Notes shall be executed in the~name of the County by the manual or facsimile signature of its Treasurer-Tax Collector and shall be countersigned by the manual or facsimile signature of its Clerk of the Board of Supervisors, and the seal of the County shall be affixed, imprinted, or otherwise reproduced on each of said Notes, The Notes shall be authenticated by the Paying Agent, in which case the signatures of both the aforesaid officers may be facsimile. Section 8. The Purchase Contract for the Notes, in the form attached hereto as Appendix B and hereby made a part hereof, be and the same hereby is approved. The Treasurer-Tax Collector is hereby authorized to determine the amount of Notes to be sold, the dates of issuance and maturity of the Notes, the interest rate on the Notes and to approve the sale of the Notes to Ehrlich Bober & Co., Inc., the Underwriter, at the purchase price and on the terms and conditions set forth in the Purchase Contract, and the Treasurer-Tax Collector is hereby authorized and directed to execute the Purchase Contract with such changes, insertions and omissions as may be approved by the Treasurer-Tax (g} Collector, said execution being conclusive evidence of such approval. Section 9. The Auditor-Controller is hereby authorized to approve the preliminary and final Official Statements and their use in connection with the offering and sale of the Notes, to execute the final Official Statement and any amendment or supplement thereto, in the name of and on behalf of the County, and thereupon to cause the final Official Statement and any such amendment or supplement to be delivered to the Underwriter with such approval to be conclusively evidenced by his execution and delivery thereof. Section 1C. The County shall at all times do and perform all acts and things necessary or desirable in order to assure that interest paid on the Notes shall, for the purposes of federal income taxation, be excludable from the gross income of the recipients thereof and exempt from such taxation. The County shall not permit at any time or times any of the proceeds of the Notes or any other funds of the County to be used directly or indirectly to acquire any securities or obligations, the acquisition of which would cause any Note to be an "arbitrage bond" as defined in Section 148 of the Internal Revenue Code of 1986, as amended. The Auditor-Controller is hereby authorized to execute an Arbitrage and Use of Proceeds Certificate in respect to the Notes for and on behalf of the County. (10) Section 11. Said Notes are hereby designated as "qualified tax-exempt obligations" pursuant to the provisions of the Internal Revenue Code of 1986, as amended {the "Code"). In making such designation it has been determined that: {a} the County does not reasonably anticipate that the amount of "qualified tax-exempt obligations" to be issued by the County during the current calendar year will exceed $10,000,000; and {b) the amount of "qualified tax-exempt obligations" issued by the County during the current calendar year does not as of this date, and including this issue, exceed $10,000,000. Section 12. All of the recitals relating to the availability of reserve funds only for designated purposes and the reasonable requirements of such reserve funds for such purposes, contained in Resolution No. 83-111 passed and adopted by the Butte County Board of Supervisors on June 21, 1983 are hereby reaffirmed as true and correct. It is also hereby determined that (i} the moneys in the Self-Insurance Fund, in the amount of $3,205,35$. , as of May 1, 1988, shall be available only for the purpose of paying public liability claims against the County and are reasonably required for such purpose, (ii} the moneys in the Workers' Compensation Reserve Fund, in the amount of $ 3, 673, 525. as of May 1, {11) 1988, shall be available only for the purpose of paying workers' compensation claims against the County and are reasonably required for such purpose, and (iii) the moneys in the Unemployment Compensation Insurance Claims-Payment Fund, in the amount of $ 641.450. ,,, as of May 1, 1988, shall be available only for the purpose of paying unemployment compensation insurance claims against the County and are reasonably required for such purpose. Section 13. It is hereby covenanted and warranted by the County that all recitals and representations contained in this resolution are true and correct, and that the County. acting through its appropriate officers, has taken or will take all steps necessary to be taken, to be and remain eligible to collect, and to collect the Pledged Revenues described herein in the amounts and at the times anticipated in accordance with all applicable laws and regulations, in order to provide for the prompt payment of the Notes authorized herein and to comply with the provisions of this resolution, Section l4. This resolution shall take effect immediately. PASSED AND ADOPTED by the Hoard of Supervisors of the County of Butte this 7th day of June, 1988, by the following vote: (12) AYES: Supervisors Dolan, Fulton, McLaughlin, Vercruse and Chairman McInturf NOES : Nane ABSENT: None. 1 (SEAL} C airma of he oard of Su rvisors Attest: ~-c-e~-- Clerk of the Board of Supervisors {13) APPENDIX A FORM OF NOTE No. United States o€ America $ State o€ California COUNTY OF BUTTE TAX AND REVENUE ANTICIPATION NOTE-19$8/19$9 FOR VALUE RECEIVED, the County of Butte, California {the "County"), duly created and existing under the laws of the State of California, promises to pay to the bearer hereof, the sum of DOLLARS ($ ) on the day of 1989, together with interest thereon from the date hereof at the rate of per centum ( ~) per annum, payable at maturity. Both principal of and interest on this Note will be paid in lawful money of the United States of America, upon surrender of this Note at the principal corporate trust office of Security Pacific National Trust Company (New York), Agent"). This Note is one the Notes of which are of denomination, and is issu Part I, Division 2, Title New York, New York (the "Paying of an authorized issue of $ , like tenor except as to number and ed pursuant to Article 7.6, Chapter 4, 5 of the Government Code of the State of California, and a resolution duly adopted by the Board of Supervisors of the County on June 1988 (the "Resolution"). (1) Payment of the principal of and interest on this Note is secured by a pledge of unrestricted moneys expected to be received by the County including taxes, income, revenue, cash receipts, and other moneys intended as receipts for the General Fund and other unrestricted funds of the County and which are generally available for the payment of current expenses and other obligations of•the County during its 1988/1989 fiscal year (the "Unrestricted Moneys"). The County has pledged to the payment of the principal of the Notes the Unrestricted Moneys expected to be received as follows: the first $ of such revenues in February, 1989; the first $ of such revenues in March, 1989; the first $ of such revenues in April, 1989; and the first $ of such revenues in May, 1989; all as more particularly described in the Resolution. The County has pledged to the payment of the interest on the Notes the amount necessary to pay such interest from the first $378,000 of Unrestricted Moneys to be received in dune, 1989. The Notes and the interest thereon shall be a first lien and charge against, and shall be payable from, the first moneys received by the County from said gledged moneys. The Notes are general obligations of the County, and, to the extent not paid from said pledged moneys, the Notes shall be laid with interest thereon from any other moneys of the County lawfully available therefor. This Note is not subject to call or redemption prior to maturity. (2) This Note shall not be valid or become obligatory for any purpose until the Certificate of Authentication hereon shall have been duly executed by the Paying Agent. This Note has been designated by the District as a "qualified tax-exempt obligation" pursuant to Section 266 of the Internal Revenue Code of 1986, as amended. IT IS•HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Note have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Note, together with all other indebtedness of the County, does not exceed any debt limit prescribed by the laws or Constitution of the State of California. IN WITNESS WHEREOF, the County of Butte, California, has caused this Nate to be signed by the facsimile signature of its Treasurer and countersigned by the facsimile signature of its Clerk of the Board of Supervisors and its corporate seal (or a facsimile thereof), to be printed, engraved, stamped or otherwise placed hereon and has caused this Note to be dated the day of , 1388. (Facsimile Seal) (Facsimile Signature) Countersigned: Treasurer-Tax Collector of the County of Sutte, California {Facsimile Signature) Clerk of the Board of Supervisors of the County of B:~tte, California (~~ CERTIFICATE OF AUTHENTICATION It is hereby certified that this Note is one of the duly authorized issue of Notes referred to herein. SECURITY PACIFIC NATIONAL TRUST COMPANY (NEW YORK) Paying Agent By Authorized Signature (4) APPENDI$ B COUNTY OF BUTTE, CALIFORNIA Tax and Revenue Anticipation Notes-1988/1989 CONTRACT OF PURCHASE Oroville, California Dick Puelicher 1988 Treasurer-Tax Collector County of Butte 25 County Center Drive Oroville, California 95965 Dear Mr. Puelicher: The undersigned (the "Underwriter") offers to enter into this agreement with the County of Butte, California (the "County") which, upon the County's acceptance hereof, will be binding upon the County and upon the Underwriter. This offer is made subject to the written acceptance of this Contract of Purchase by the County and the delivery of such acceptance to the Underwriter at or prior to 4:00 o'clock P.M. California time, on the date hereof. 1. Upon the terms and conditions and upon the basis of the representations and warranties hereinafter set forth, the Underwriter hereby purchases from the County for reoffering to the public, and the County hereby sells to the Underwriter for such purpose, all (but not less than all) of $ (or such lesser amount as shall actually be~issued in accordance with the provisions of the resolution as hereinafter defined), principal amount of the County's Tax and Revenue Anticipation Notes 1986/1989 dated 1988 and due 1989 (the "Notes") bearing interest at the rate of per centum { ~} per annum, at a purchase price of $ , plus accrued interest, if any, from ~, 1988, to the date of the Closing (as hereinafter defaned . 2. The Notes shall be as described in the Resolution adopted by the Board of Supervisors of the County on dune , 1988, authorizing the issuance of the Notes {the "Resolution" , and shall be issued under the provisions of the Constitution and laws of the State of California (the "State"). (1) 3. At the time of or before the County's acceptance hereof, the County shall deliver to the Underwriter an Official Statement of the County, dated ~ , 198$, relating to the Notes (which, together with all appendices thereto and with such changes therein and supplements thereto which are consented to in writing by the Underwriter, is herein called the "Official Statement"), in a form satisfactory to the Underwriter and duly executed by the County. The County authorizes the use and reproduction of the Official Statement in connection with the offering and sale of the Notes by the Underwriter. The County also approves of and ratifies the use and reproduction by the Underwriter prior to the date of the Official Statement of a Preliminary Official Statement of the County relating to the Notes (which, together with all appendices thereto, is herein called the "Preliminary Official Statement"} in connection with the offering of the Notes. 4. The Underwriter agrees to make a bona fide public offering of all the Notes at the initial public offering price as set forth on the cover page of the Official Statement. Subsequent to such initial public offering, the Underwriter reserves the right to change the public offering price as it may deem necessary in connection with the marketing of the Notes. 5. At ZO:00 o'clock A.M., New York City time, on 1988, or at such other time or on such later business day as shall have`been mutually agreed upon by the County and the Underwriter (the "Closing"), the County will deliver to the Underwriter at the offices of Ehrlich Bober & Co., Inc., 101 Park Avenue, New York, New Yark, or at such other place as the County and the Underwriter may mutually agree upon, the Notes in definitive form duly executed, together with the other documents hereinafter mentioned; and the Underwriter will accept such delivery and pay the purchase price as set forth in paragraph 1 hereof in "Federal Reserve Funds" to the order of the County. The Notes will be made available in San Francisco, California or New York, New York for checking and packaging and will be taken up by the Underwriter for safekeeping two business days prior to the Closing. 6. The County represents and warrants to the Underwriter that: (A} The County is validly existing under the laws of the State, including the State Constitution, with right and power to sell the Notes as of the date hereof and to hereafter issue the Notes and to execute, deliver and perform its obligations under this Contract of Purchase and the Notes. (B} (i} At or prior to the Closing, the County will have taken all action required to be taken by it to authorize the (2} issuance and delivery of the Notes and the performance of its obligations thereunder, (ii} the County has, and at the date of the Closing will continue to have, full legal right, power and authority to enter into this Contract of Purchase and, at the date o€ the Closing, will have full legal right, power and authority to issue and deliver the Notes to the Underwriter and to perform its obligations thereunder as provided herein and therein; at or prior to the Closing, the execution and delivery of, and the performance by the County of its obligations contained in the Notes and this Contract of Purchase shall have been duly authorized; {iii} this Contract of Purchase has been duly executed and delivered and constitutes a valid and legally binding obligation of the County; and (iv) the County has duly authorized the consummation by it of all transactions contemplated by this Contract of Purchase. {C) The Notes shall be secured as to the payment of principal and interest from the revenues and in the manner as described in the Resolution and the Official Statement. All of the Notes shall be general obligations of the County, and, to the extent not paid from the revenues pledged thereto, they shall be paid from any other moneys of the County lawfully available therefor. {D} The County reasonably anticipates that the revenues anticipated to be received or accrued in its 1988/1989 fiscal year, including the revenues pledged to the payment of the Notes, will be received in cash in the amounts and by the respective dates indicated in the Official Statement. As of the Closing, the County will have taken all action to be taken by such date required by law, regulation or administrative order or directive, or in the County's judgment necessary and feasible, in order to qualify for and to receive in cash such anticipated revenues in such amounts and by such dates, and the County will use its best efforts to cause such revenues to be received in cash at the times indicated in the 1988/1989 Cash Flow Schedule in the Official Statement. The County agrees that it will not issue any additional notes secured by a pledge of the revenues pledged to pay the Notes. {E} There are no present or foreseeable events, conditions or determinations of which the County is aware which will prevent the receipt of and application by the County of the revenues pledged to pay the Notes. (F} The Official Statement (excluding therefrom the "Price" on the cover page, and the information under the caption "Underwriting", as to which no representations or warranties are made), as of its date and at all times (3) subsequent thereto up to and including the date of the Closing, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. {G) The issuance of the Notes, the execution, delivery and performance of this Contract of Purchase, the performance of the County's obligations under the Notes and compliance with the provisions hereof and thereof by the County, do not and will not conflict with or constitute on the part of the County a breach of, or a default under, any existing law, ordinance, regulation, decree, order or resolution, or {to the best knowledge of the County, after due investigation) any agreement, indenture, mortgage, lease ar other instrument, to which the County is subject or by which it is bound. {H) All authorizations, consents or approvals af, or filings or registrations, if any, with any Governmental Authority or court necessary for the valid issuance of and performance by the County of its obligations under the Notes will have been duly obtained or made prior to the issuance of the Notes land disclosed to the Underwriter). As used herein, the term "Governmental Authority" refers to any legislative body or governmental official, department, commission, board, bureau, agency, instrumentality, body or public benefit corporation. (I} As of the time of acceptance hereof and as of the Closing, except as disclosed in the Official Statement, no action, suit, proceeding or investigation is pending or (to the best knowledge of the County) threatened against the County or (to the best knowledge of the County, no independent investigation having been made) any other person in any court or before any Governmental Authority seeking to restrain or enjoin the issuance or delivery of any of the Notes or in any way contesting or affecting the validity of the Resolution, the Notes, this Contract of Purchase, or the receipt or application of the revenues pledged to pay the Notes or the payment of principal of and interest on the Notes, or contesting the powers of the County to issue the Notes. (J} Any certificate signed by any official or other representative of the County and delivered to the Underwriter pursuant to this Contract of Purchase shall be deemed a representation and warranty by the County to the Underwriter as to the statements therein made, {~) (K} A copy of the Resolution has been delivered to the Underwriter and such Resolution will not be amended without the consent of the Underwriter which consent will not be unreasonably withheld. 7. The Underwriter has entered into this Contract of Purchase in reliance upon the representations and warranties of the County contained herein, the Resolution, and the performance by the County of its obligations hereunder, as of the date hereof and as of the date of the Closing. The Underwriter's obligations under this Contract of Purchase are and shall be subject to the following further conditions as of the Closing: (A) The representations and warranties of the County contained herein shall not be materially inaccurate at the date hereof and at and as of the Closing. as if made at and as of the Closing, and the statements made in all certificates and other documents delivered to the Underwriter at the Closing pursuant hereto shall not be materially inaccurate at the Closing; and the County shall be in compliance with each of the agreements made by it in this Contract of Purchase (unless such agreements are waived by the Underwriter), (B} At the time of the Closing this Contract of Purchase shall be in full force and effect; the Resolution and this Contract of Purchase shall not have been amended, modified or supplemented except as may have been agreed to in writing by the Underwriter; all actions which, in the opinion of Hawkins, Deiafield & Wood, New York, New York, Bond Counsel to the County, (the "Bond Counsel"}, shall be necessary in connection with the transactions contemplated hereby shall have been duly taken and shall be in full force and effect; and the County shall perform or have performed all of its obligations required under or specified in the Resolution, this Contract of Purchase, or the Official Statement to be performed at or prior to the Closing. (C} The provisions of law governing the payment of the revenues pledged to pay the Notes shall be in full force and effect and shall not have been amended in any respect that would materially adversely affect the prospects that such revenues will be received in the amounts and by the respective dates indicated in the Resolution and the Official Statement. (D) Except as disclosed in the Official Statement, no decision, ruling or finding shall have been entered by any court or Governmental Authority since the date of this Contract of Purchase (and-not reversed on appeal or otherwise set aside) (i) which has any of the effects described in (5} Section 6(I}, or {ii} which declares this Contract of Purchase to be invalid or unenforceable in whole or in material part. {E} In recognition of the desire of the County and the Underwriter to effect a successful public offering of the Notes, and in view of the potential adverse impact of any of the following events on a public .offering, the Underwriter shall have the right to cancel its obligations to acquire the Notes, by written notice from the Underwriter to the County, if between the date hereof and the Closing: (i) the Official Statement shall have been amended, modified or supplemented without the consent in writing of the Underwriter, unless such consent was unreasonably witheld or {ii} any event shall occur which, in the reasonable professional judgment of the Underwriter, makes untrue any statement of a material fact set forth in the Official Statement or results in an omission to state a material fact necessary to make the statements therein, in the light of the circumstances under which they are made, not misleading; or (iii} the market for the Notes or the ability of the Underwriter to enforce contracts for the sale of the Notes shall have been materially and adversely affected, in the reasonable professional judgment of the Underwriter, by (a) legislation enacted by the Congress of the United States, or passed by either House of the Congress, or recommended to the Congress for passage by the President of the United States, or favorably reported for passage to either House of the Congress by a committee of such House to which such legislation has been referred for consideration, or a decision rendered by a court of the United States or by the United States Tax Court, ar a ruling, order, official statement, or regulation (final, temporary or proposed) made by the Treasury Department of the United States or the Internal Revenue Service, with respect to Federal taxation upon interest received on obligations of the general character of the Notes or which would have the effect of changing, directly or indirectly, the Federal income tax consequences of interest on obligations of the general character of the Notes in the hands of the holders thereof, or (b} any new outbreak of hostilities or other national or international calamity or crisis or an event of fiscal default by a city, municipality, district or authority located in the State, the effect of such outbreak, calamity, crisis or default being such as would cause a major disruption in the municipal bond market, or {c) a general suspension of trading on the New York Stock Exchange, or fixing of minimum or maximum prices for trading or maximum ranges for prices for securities on the New York Stock Exchange, whether by virtue of a determination by that Exchange or by order of the Securities and Exchange Commission or any other governmental authority having {g) jurisdiction, or (d} a general banking moratorium declared by either Federal or State authorities having jurisdiction, or (e} any action, suit, proceding or investigation described in Section 6{I) hereof or any decision described in Section 7{D} hereof, or {f) any default by the County, the State or by any state public benefit corporation or other city or state governmental agency (except an industrial development agency) existing under the laws of California. (F} At or prior to the Closing, the Underwriter shall receive the following documents each dated on and as of the date of the Closing: (1} Unqualified approving opinion of Bond Counsel, as to the validity and tax-exempt status of the Notes. {2) A certificate of the County, executed on its behalf by its Auditor-Controller, substantially in the form attached hereto aG Fxh;h;r A {3) An opinion of the County Counsel, substantially in the form attached hereto as Exhibit B. (4} An Arbitrage and Use of Proceeds Certificate, satisfactory in form and substance to Bond Counsel. {5) Evidence of the deposit of funds required to be so deposited as of the date hereof to pay the outstanding $3,700,000 Tax and Revenue Anticipation Notes-1987/1988 of the County due July 1, 3988. {5} Evidence that any rating on the Notes heretofore obtained has not been changed or withdrawn. (7) Such additional legal opinions, certificates, proceedings, instruments and other documents as the Underwriter, Underwriter's Counsel or Bond Counsel may reasonably request to evidence compliance by the County with legal requirements, the accuracy, as of the time of Closing, of the County's representations herein contained and the due performance or satisfaction by the County at or prior to such time of all agreements then to be performed and all conditions then to be satisfied by the County. If the County shall be unable to satisfy the conditions to-the Underwriter's obligations contained in this Contract of Purchase or if the Underwriter's obligations shall be terminated for any reason permitted by this Contract of Purchase, this Contract of Purchase shall terminate and neither the County nor the Underwriter shall have any further obligation hereunder, {7) except that the respective obligations of the parties to pay certain expenses as provided in Section 10 herein shall continue in full force and effect. 8. The performance by the County of its obligations is conditioned upon {i) the performance by the Underwriter of its obligations hereunder; and (ii) receipt by the County and the Underwriter of opinions and certificates being delivered at the closing by persons and entities other than the County. 9. At the Closing, the Underwriter shall advise the County as to whether or not the Underwriter is still offering Notes, and far a period of not exceeding 20 days after the Closing, if and so long as such offering continues {a) the County will furnish such information with respect to itself as the Underwriter may from time to time reasonably request and {b) if any event shall occur as a result of which it is necessary, in the opinion of the County or the Underwriter, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances then existing, the County will forthwith prepare and furnish to the Underwriter (at the expense of the Underwriter) a reasonable number of copies of an amendment of or supplement to the Official Statement (in form and substance satisfactory to Bond Counsel to the County 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 then existing, not misleading. 10. Whether or not the Notes are issued as contemplated by this Contract of Purchase, the Underwriter shall pay (i) the cost of preparation and reproduction of this Contract of Purchase, the Preliminary Official Statement and the final Official Statement, and the cost of printing the Notes; (ii) fees of the California Debt Advisory Commission and of any rating agencies rating the Notes; and (iii) other expenses incurred by it in connection with offering and distribution of the Notes, including the fees and disbursements of counsel retained by it. The County shall be responsible for any other costs that may be incurred, pursuant to contract or otherwise, in connection with the issuance of the Notes. 11. Any notice or other communication to be given to the County under this Contract of Purchase may be given by delivering the same in writing to the Treasurer-Tax Collector, or to such other person as he may designate in writing, and to Hawkins, Delafield & Wood, 67 Wall Street, New York, New York, or at such other address or to such other firm as the County shall hereafter advise the Underwriter in writing, and any notice or other communication to be given to the Underwriter under this ($) Contract of Purchase {other than the acceptance hereof as specified in the first paragraph hereof} may be given by delivering the same in writing to Ehrlich Bober & Co., Inc., 401 Wilshire Boulevard; Suite 1250, Santa Monica, California 90401, Attention: Investment Banking Division. The approval of the Underwriter or the determination of its satisfaction as to any document referred to herein shall be in writing signed by Ehrlich Bober & Co., Inc., and delivered to the County. 12, This Contract of Purchase when accepted by the County in writing as heretofore specified shall constitute the entire agreement between the County and the Underwriter and is made solely for the benefit of the County and •the Underwriter (including the successors or assigns of the Underwriter). No other person shall acquire or have any right hereunder or by virtue hereof. 13. This Contract of Purchase may be simultaneously in original and all instrument. several counterparts each of of which shall constitute but Very truly yours, executed which shall be an one and the same EHRLICH BOBER & CO., INC. By Underwriter Accepted: County of Butte By Treasurer-Tax Collector (9) EXHIBIT A to the Contract of Purchase CERTIFICATE OF THE AUDITOR-CONTROLLER COUNTY OF BUTTE JAMES L. JOHANSEN, Auditor-Controller, County of Butte, California {the "County"), hereby certifies on behalf of the County as follows: 1. i am the official of the County having overall responsibility for the financial operations of the County. 2. The County's Official Statement, dated , 1988, (the "Official Statement") relating to the sale of $ of the County's Tax and Revenue Anticipation Notes-1988 1989 {the "Notes"?, delivered pursuant to the Contract of Purchase, dated 1988 between the County and the Underwriter (the "Contract of Purchase") (excluding from such Official Statement the "Price" on the cover page and the information under the caption "Underwriting") as of the date hereof does not contain any untrue statement of a material fact or omit any statement of a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 3. The representations and warranties of the County in the Contract of Purchase, are true and correct on and as of the date hereof as if made on and as of the date hereof, and the County has complied with and performed all of its covenants and agreements in the Contract of Purchase. 4. Each of the conditions in Section 7 of the Contract of Purchase to be satisfied by the County has been satisfied by the County on the date hereof and the County is not aware of any other condition of the Contract of Purchase that has not been satisfied on the date hereof. 5. The Notes being delivered on the date hereof to the Underwriter under the Contract of Purchase and the sources of payment thereof conform to the descriptions thereof contained in the County's Official Statement delivered to such Underwriter. (10} 6. There has been no material adverse change in the financial condition or results of operations of the County from the date of the Official Statement to the date hereof. IN WITNESS WHEREOF, I have hereunto set my hand this day of 1988. COUNTY OF BUTTE By Auditor-Controller (11y EXHIBIT $ to the Contract of Purchase (Letterhead of County Counsel) 1988 Board of Supervisors County of Butte 25 County Center Drive Oroville, California Ehrlich Bober & Co., Inc. 401 Wilshire Boulevard Suite 1250 Santa Monica, California Gentlemen: Reference is made to a Contract of Purchase dated , 1988 ("Contract of Purchase"), between the County of Butte the "County") and Ehrlich Bober & Co., Inc., in connection with which you have requested my opinion as to the matters set forth below. All terms used herein have the definitions set forth in the Contract of Purchase and the Official Statement, referred to herein. I have examined such portions of the Constitution of the United States of America, the Constitution and Statutes of the State of California (the "State") and such applicable court decisions as I deemed necessary or relevant for purposes of the opinions set forth below, and made such further inquiries and investigations as I deemed necessary or appropriate for purposes of such opinions. Based on the foregoing, I advise you that in my opinion: 1. There is no litigation of any nature pending or threatened to restrain or enjoin the issuance, sale, execution or delivery of the Contract of Purchase, the Notes or any of the proceedings taken with respect to the issuance and sale of the Notes, the application of moneys to the payment of the Notes or in any manner questioning the proceedings and authority under which the Notes were authorized or affecting the validity of the Notes, the existence or boundaries of the County or the title of (12) officials of the County who have acted with respect to the proceedings for the issuance and sale of the Notes to their respective offices, and no authority or proceedings for the issuance and sale of the Notes have been repealed, revoked or rescinded; 2. The statements contained in the Official Statement dated 1688 under the caption "Litigation" are accurate and complete in all material respects. Except as disclosed in the Official Statement, there are no matters of litigation now pending or threatened the outcome of which would have an adverse material effect on the financial condition of the County during the period the Notes will be outstanding, 3. The issuance of the Notes, the execution, delivery and performance of the Contract of Purchase, the performance of the County's obligations under the Notes and compliance with the provisions thereof by the County, do not and will not conflict with or constitute on the part of the County a breach of, or a default under any agreement, indenture, mortgage, lease or other instrument, to which the County is subject or by which it is bound. Very truly yours, (13) CLERK'S CERTIFICATE I, MARTIN J. NTCHOLS, Clerk of the Board of Supervisors, County of Butte, State of California, HEREBY~CERTIFY that the foregoing annexed extract from the minutes of a meeting of the Board of Supervisors of said County of Butte duly called and held on June 1988, has been compared by me with the original minutes as officially recorded in my office in the minute book of said Board of Supervisors and is a true, complete and correct copy thereof and of the whole of said original minutes so far as the same relate to the subject matters referred to in said extract. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of said County of Butte this day of , 1988. {SEAL} Clerk of the Board of Supervisors