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HomeMy WebLinkAbout96-076RESOLUTION NO. 9h-~h RESOLUTION OF THE BOARD OF SUPERVISORS OF BUl-fE COUNTY AUTHORIZING THE ISSUANCE OF 1996-1997 TAX AND REVENUE ANTICIPATION NOTES FOR BUTTE COUNTY OFFICE OF EDUCATION WHEREAS, pursuant to Sections 53850, et seq., of the Government Code of the State of California (the "Act") contained in Article 7.6 thereof, entitled "Temporary Borrowing," school districts and county offices of education organized and existing under the laws of the State of California are authorized to borrow money by the issuance of temporary notes for any purpose which the office is authorized to expend moneys, including, but not limited to, current expenses, capital expenditures, and the discharge of any obligation or indebtedness; and WHEREAS, Section 53853 of the Act provides that such notes must be issued in the name of the office by the Board of Supervisors of the County (the "County Board"), the County Superintendent of which has jurisdiction over the office, as soon as possible following the receipt of a resolution of the Board of Education of the office requesting the borrowing; and WHEREAS, the County Superintendent of Butte County (the "County") has jurisdiction over the Butte County Office of Education (the "Office"); and WHEREAS, the Board of Education of the Office {the "Office Board") has requested that the County Board authorize the issuance of and offer for sale tax and revenue anticipation notes in the name of and on behalf of the Office under and pursuant to the provisions of the Act in an amount not to exceed Thirty Million Dollars ($30,000,000) at an interest rate not to exceed five percent {5%); NOW, THEREFORE, the Board of Supervisors of Butte County hereby resolves as follows: Section 1. Findings. All of the above recitals are true and correct and the County Board so finds and determines. Section 2. Authorization of Issuance of Notes; Terms Thereof; Paying Agent. The County Board hereby approves the request of the Office Board to issue notes on its behalf in an amount not to exceed $30,000,000 principal amount of Notes under Section 53850, et seq., of the Act, designated "Butte County Office of Education, -1- 2sosa~.~ Butte County, State of California, 1996-1997 Tax and Revenue Anticipation Notes" (the "Notes"); to be numbered from 1 consecutively upward in order of issuance; to be in the denominations of $5,000, or integral multiples thereof, to be dated the date of delivery thereof; to mature (without option of prior redemption) one year from the date of delivery; and to bear interest, payable at maturity and computed on a 30-day month/360-day year basis, at the rate or rates determined at the time of sale thereof, but not in excess of five percent (5%) per annum. Both the principal of and interest on the Notes shall be payable, only upon surrender thereof, in lawful money of the United States of America at the principal office of the Butte County Treasurertfax Collector, Oroville, California, which is hereby designated by this Board as the paying agent for the Notes (the "Paying Agent"). Section 3. Form of Notes. The Notes shall be issued in registered form, without coupons signed by facsimile or manual signature of the County Treasurer or designee, and shall be substantially in the form and substance set forth in Exhibit A attached hereto and by reference incorporated herein, the blanks in said farm to be filled in with appropriate words and figures. The Notes shall be issued in fully registered form, and at the closing, there shall be one Note registered in the name of Cede & Co., as nominee of the Depositary Trust Company, New York, New York ("DTC"). DTC is hereby appointed depository for the Notes. There shall be printed on each Note the legal opinion of Kronick, Moskovitz, Tiedemann & Girard respecting the validity of said Notes and, immediately following such legal opinion, a certificate executed with the manual or facsimile signature of the Clerk of the County Board, said certificate to be in substantially the following form: I HEREBY CERTIFY that the foregoing is a true and correct copy of the legal opinion regarding the Notes therein described that was manually signed by Kronick, Moskovitz, Tiedemann & Girard, and was dated as of the date of delivery of and payment for said Notes. Manual or Facsimile Signature Clerk of the Board of Supervisors Section 4. Transfer and Exchange of Notes. Subject to the provisions of Section 5 hereof, the registration of any Note may, in accordance with its terms, be transferred, upon the registration books kept by the Paying Agent for such purpose, by the person in whose name it is registered, in person or by his or her duly authorized attorneys, upon surrender of such Note for cancellation, accompanied by delivery of a written instrument of transfer, fully executed in a form approved by the Paying Agent. -2- 2sosa~.~ Whenever any Note or Notes shall be surrendered for registration or transfer, the Paying Agent shall execute and deliver a new Note or Notes, for a like aggregate principal amount. The Paying Agent shall require the Note owner requesting such registration of transfer to pay any tax or other governmental charge required to be paid with respect to such transfer. The County may require the owner requesting such registration of transfer to pay such additional reasonable charge as may be necessary to cover customary expenses incurred and fees charged by the Paying Agent with respect to such registration of transfer. The Paying Agent may treat the registered owner of any Note as the absolute owner thereof for all purposes whatsoever in accordance with this resolution, and the Paying Agent shall not be affected by any notice to the contrary. Subject to the provisions of Section 4 hereof, Notes may be exchanged at the Office of the Paying Agent in Oroville, California far a like aggregate principal amount of Notes in other authorized denominations. The Paying Agent shall require the payment by the Note owner requesting such exchange of any tax or other governmental charge required to be paid with respect to such exchange. The Paying Agent may require the owner requesting such exchange to pay such additional reasonable charge as may be necessary to cover customary expenses incurred and fees charged by the Paying Agent or the Office with respect to such exchange. Section 5. Use of Depository. (1) The Notes shall be initially registered as provided in Section 3 hereof. Registered ownership of the Notes, or any portion thereof, may not thereafter be transferred except: (i) To any successor of Cede & Co., as nominee of the Depository Trust Company, or its nominee, or to any substitute depository designated pursuant to clause (ii) of this Section 5 (a "substitute depository"); provided, that any successor of Cede & Co., as nominee of The Depository Trust Company or a substitute depository, shall be qualified under any applicable laws to provide the services proposed to be provided by it; (ii) Ta any substitute depository not objected to by the Paying Agent, upon (1) the resignation of The Depository Trust company or its successor (ar any substitute depository or its successor) from its functions as depository, or (2} a determination by the Office to substitute another depository for The Depository Trust Company (or its successor} because The Depository Trust Company or its successor {or any substitute depository or its -3- 2soss~.~ successor) is not longer able to carry out its function as depository; provided, that any such substitute depository shall be qualified under any applicable laws to provide the services proposed to be provided by it; or (iii) To any person as provided below, upon (1) the resignation of the Depository Trust Company or its successor (or substitute depository or its successor) from its functions as depository, or (2) a determination by the Office to remove the Depository Trust Company or its successor (or any substitute depository or its successor) from its functions as depository. {2) In the case of any transfer pursuant to clause {i) or clause (ii) of subsection (1) of this Section 5, upon receipt of the outstanding Notes by the Paying Agent, together with a request of the Office to the Paying Agent, a new Note shall be executed and delivered in the aggregate principal amount of the Notes registered in the name of such successor or such substitute depository, or their nominees, as the case may be, all as specified in such request of the Office. In the case of any transfer pursuant to clause (iii) of subsection (1) of this subparagraph (d), upon receipt of the outstanding Notes by the Paying Agent together with a request of the Office to the Paying Agent, new Notes shall be executed and delivered in such denominations numbered in the manner determined by the Paying Agent and registered in the names of such persons as are requested in such a request of the Office; provided that the Paying Agent shall not be required to deliver such new Notes within a period less than sixty (60} days from the date of receipt of such a request of the Office. Thereafter, Notes shall be transferred pursuant to Section 3 hereof. (3) The Office and the Paying Agent shall be entitled to treat the person in whose name any Note is registered as the owner thereof for all purposes of this resolution and any applicable laws, notwithstanding any notice to the contrary received by the Paying Agent or the Office; and the Office and the Paying Agent shall have no responsibility far transmitting payments to, communication with, notifying, or otherwise dealing with any beneficial owners of the Notes and neither the Office nor the Paying Agent will have any responsibility or obligations, legal or otherwise, to the beneficial owners or to any other party, including The Depository Trust Company or its successor (or substitute depository or its successor), except for the Owner of any Notes. (4) So long as the outstanding Notes are registered in the name of Cede & Co. or its registered assigns, the Office and the Paying Agent shall cooperate with Cede & Co., as sale registered Owner, or its registered assigns in effecting -~- zsosa~.i payment of the principal of and interest on the Notes by arranging for payment in such manner that funds for such payments are properly identified and are made immediately available on the date they are due. Section 6. Deposit of Note Proceeds: No Arbitrage. The moneys so borrowed shall be initially deposited in the Treasury of the County in a proceeds fund (the "Proceeds Funds") to the credit of the Office and subsequently credited upon delivery of the District Notes to the respective general funds of the districts in the amount of the respective loans requested from the Office by certain school districts within the County. Until used or expended, the moneys shall be invested in investments as permitted by applicable California law. The Office has covenanted that it will make no use of the proceeds of the Notes that would cause the Notes to be "arbitrage bonds" under Section 148 of the Code; and, to that end, so long as any of the Notes are outstanding, the Office, and all of its officers having custody or control of such proceeds, shall comply with all requirements of (a} said section, including restrictions on the use and investment of proceeds of the Notes and the rebate of a portion of investment earnings on certain amounts, including proceeds of the Notes, if required, to the Federal government, and (b) of the Income Tax Regulations of the United States Treasury promulgated thereunder or any predecessor provisions, to the extent that such regulations are, at the time, applicable and in effect, so that the Notes will not be "arbitrage bonds." To the extent that monies invested or held by the County are subject to arbitrage rebate, neither the County or any officer or employee of the County shall assume hereunder or under the provisions of any rebate certificate any duty or obligation to make the actual calculations of arbitrage rebate liability of the Office, or to pay any such rebate or any penalties in regard thereto if the Office miscalculates or fails to pay or cause such rebate or such penalties to be paid. Section 7. Payment of Notes. (A) Source of Payment. The principal amount of the Notes, together with the interest thereon, shall be payable from taxes, income, revenue, cash receipts, and other moneys which are received by the Office during fiscal year 1996-1997 and which are available therefor. The Notes shall be a general obligation of the Office, and, to the extent the Notes are not paid from the Pledged Revenues defined below, the Notes shall be paid with interest thereon from any other moneys of the Office lawfully available therefor, as provided herein and by law. -5- zsasa~ ~ (B) Pledq_ed Revenues. The Notes shall be secured by a pledge of and first lien and charge against the first unrestricted revenues to be received by the County on behalf of the Office in such months and in such amounts as shall be determined by the Butte County Superintendent of Schools (the "Superintendent"), or the Superintendent's designee, prior to the date of the sale of the Notes, sufficient to pay the principal of and interest on the Notes at maturity {such pledged amounts being hereinafter called the "Pledged Revenues"). The term "unrestricted revenues" shall mean taxes, income, revenue, cash receipts, and other money of the Office as provided in Section 53856 of the Act, which are intended as receipts for the general fund of the Office and which are generally available far the payment of current expenses and other obligations of the Office, all as further defined in the Office Resolution. (C) Covenant Re aq riling Additional Short-Term Borrowing. The Office has covenanted and warranted that it will not request the County TreasurerlTax Collector (in such capacity, the "County Treasurer") to make temporary transfers of funds in the custody of the County Treasurer to meet any obligations of the Office during the 1996-1997 fiscal year pursuant to the authority of Article XVI, Section 6, of the Constitution of the State of California or any other legal authority. (D} Deposit of Pledged Revenues in Repayment Fund. The Pledged Revenues shall be deposited in the County Treasury in the appropriate account in a special fund designated as the "Butte County Office of Education Tax and Revenue Anticipation Notes Repayment Fund" (herein called the "Repayment Fund") and applied as directed in this Resolution. Separate accounts shall be established within the Repayment Fund for the deposit of (i) unrestricted revenues received by the Office as payments with respect to each loan made from the proceeds of the Notes to a school district and (ii) unrestricted revenues from other sources. Any moneys placed in the Repayment Fund shall be for the benefit of the holders of the Notes, and until the Notes and all interest thereon are paid or until provision has been made for the payment of the Notes at maturity with interest to maturity, the moneys in the Repayment Fund shall be applied anly for the purposes for which the Repayment Fund is created. (E) Disbursement and Investment of Moneys in Repayment Fund. From the date this Resolution takes effect, all Pledged Revenues shall, when received, be deposited in the Repayment Fund to be held, invested and accounted for as provided herein. After such date as the amount of Pledged Revenues deposited in the Repayment Fund shall be sufficient to pay in full the principal of and interest on the Notes, when due, any moneys in excess of such amount remaining in or accruing to the Repayment Fund shall be transferred to the general fund of the Office upon the request of the Office. On the maturity date of the Notes, the -6- 2sosa7.~ moneys in the Repayment Fund shall be used, to the extent necessary, to pay the principal of and interest on the Notes. Moneys in the Repayment Fund shall be invested in investment securities by the County Treasurer, or such other appropriate investment officer of the County, directly, or through an investment agreement, in investments as permitted by applicable California law, as it is now in effect and as it may be amended, modified or supplemented from time to time, and the proceeds of any such investments shall, as received, be deposited in the Repayment Fund and shall be part of the Pledged Revenues. Moneys so invested, and the earnings thereon, shall be accounted for as Pledged Revenues, to be withdrawn solely far deposit in the Repayment Fund and used, to the extent necessary, to pay the principal of and interest on the Notes. Sufficient money for the payment of principal and interest for the maturing Notes must be placed into the Repayment Fund in the County Treasury at least one business day prior to the maturity of the Notes. Section 8. Execution of Notes. The County Board hereby directs the County Treasurer to sign the Notes manually ar by facsimile signature, the Clerk of the County Board (the "Clerk") to countersign the Notes manually or by facsimile signature (provided at least one of the signatures is manual); the Clerk to affix the seal of the County thereto or a facsimile of the seal thereto; and said officers to cause the blank spaces thereof to be filled in as may be appropriate. Section 9. Sale of the Notes. The Notes will be sold either at a private sale to an underwriter or underwriters upon terms and conditions as are acceptable to the Office and consistent herewith or by competitive bid and awarded as set forth in an Official Notice of Sale which the Financial Advisor and the Superintendent of the Office, or his or her designee, are hereby authorized to prepare consistent with this Resolution. The County Treasurer, or his or her designee, is hereby authorized to decide between competitive or private sale in conjunction with advice from the financial advisor. If the sale is negotiated, the County Treasurer, or his or her designee, is authorized to negotiate the sale of no mare than $30,000,000 of notes at an interest rate of not more than 5%. If the sale is by competitive bid, the Superintendent of the Office, or his or her designee, is hereby directed to execute, and the Clerk of the Office is directed to publish, the Official Notice of Sale. The County Treasurer, or his or her designee, is hereby authorized and directed to open the bids at the time and place specified in the Official Notice of Sale. The County Treasurer, or his or her designee, is hereby authorized and directed to receive and record the receipt of all bids made pursuant to the Official Notice of Sale, to cause said bids to be examined for compliance with the Official Notice of Sale, to cause computations -7' 256587.1 to be made as to which bidder has bid the lowest true interest cost, as provided in the Official Notice of Sale, to announce the bidder of the lowest true interest cost, and, with the prior concurrence of the Superintendent of the Office or the Superintendent's designee, to award the sale to said bidder, and to notify this Board of the foregoing. Section 10. Paying Agent. The County Treasurer is hereby appointed to act as the bond registrar and the Paying Agent of the Office for the purpose of receiving the payments of principal and interest made by the Office on the Notes at maturity, to hold, allocate, use, and apply said payments and to perform such other duties and powers of the Paying Agent as are prescribed in this Resolution. Section 11. Delivery of Notes. The proper officers of the County shall cause the Notes to be delivered to the successful bidder when the County Treasurer has received confirmation of receipt of the proceeds. Section 13. Further Actions Authorized. The County Treasurer and other appropriate officers of the County are further authorized and directed to make, execute and deliver to the purchaser or purchasers of the Notes (a) a Certificate in the form customarily required by purchasers of bonds of public corporations generally, certifying to the genuineness and the execution of the Notes, and (b} a receipt in similar form evidencing the payment of the purchase price of the Notes which receipt shall be conclusive evidence that said purchase price of the Notes have been paid and has been received on the behalf of the Office. Any purchaser or subsequent taker or holder of the Notes is hereby authorized to rely upon and shall be justified in relying upon any Certificate ar receipt with respect to the Notes. Such officers and any other officers of the Office or of the County are hereby authorized to execute any and all other documents required to consummate the sale and delivery of the Notes. PASSED AND ADOPTED by the Board of Supervisors of Butte County this 23rd day of July, 1996, by the following vote: AYES: Supervisors Meyer, NOES: None ABSENT: None Attest: Cler~C;; Board of Supervisors County of Butte Dolan, Houx, Thomas and Chair McLaughlin ~: ~ '~ Chair, Board of Su rvisors, County of Butte '$' 250587.1 EXHIBIT A BUTTE COUNTY OFFICE OF EDUCATION STATE OF CALIFORNIA 1996-1997 TAX AND REVENUE ANTICIPATION NOTE NO. REGISTERED OWNER: Cede & Ca. 1996 CUSIP: 124081 FOR VALUE RECEIVED, the Butte County Office of Education, State of California, acknowledges itself indebted to and promises to pay the Registered holder hereof at the principal office of the Butte County Treasurer/Tax Collector, Oroville, California (the Paying Agent") the principal sum of DOLLARS ($ .QO) in lawful money of the United States of America, on , 1996, together with interest thereon at the rate of PERCENT ( %) per annum in like lawful money of the United States of America from the date hereof until payment in full of said principal sum. Both the principal of and interest on this Note shall be payable only to the registered owner hereof upon surrender of this Note as the same shall fall due; provided, however, that no interest shall be payable for any period after maturity during which the registered owner fails to properly present this Note for payment. It is hereby certified, recited and declared that this Note is one of an authorized issue of Notes entitled "Butte County Office of Education, Butte County, State of California, 1996-1997 Tax and Revenue Anticipation Notes" (the "Notes") in the aggregate principal amount of Dollars ($ .00), all of like date, tenor, and effect, made, executed, and given pursuant to and by authority of a resolution of the A-1 Board of Supervisors of the County of Butte duly passed and adopted on July 23, 1996, under and by authority of Article 7.6 (commencing with Section 53850) of Chapter 4, Part 1, Division 2, Title 5, California Government Cade, on behalf of the Office, and that all acts, conditions, and things required to exist, happen and be performed precedent to and in the issuance of this Note have existed, happened, and had been performed in regular and due time, form and manner as required by law, and that this Note, together with all other indebtedness and obligations of the Office, does not exceed any limit prescribed by the Constitution or statutes of the State of California. The principal amount of the Notes, together with the interest thereon, shall be payable only from taxes, income, revenue, cash receipts, and other moneys that are received by the Office during Fiscal Year 1996-1997. As security for the payment of the principal of and interest an the Notes, the Office has pledged an amount equal to twenty-five percent (25 %) of the principal amount of the Notes from the unrestricted revenues received by the Office in the month ending February 28, 1997 an amount equal to twenty-five percent (25 %} of the principal amount of the Notes from the unrestricted revenues received by the Office in the month ending March 31, 1997, an amount equal to twenty-five percent (25%} of the principal amount of the Notes from the unrestricted revenues received by the Office in the month ending Apri130, 1997 and an amount equal to twenty-five percent (25 %) of the principal amount of the Notes, plus an amount sufficient to pay interest on the Notes, from unrestricted revenues received by the Office in the month ending May 31, 1997 (such pledged amounts being hereinafter called the "Pledged Revenues"); and the principal of the Notes and the interest thereon shall constitute a first lien and charge against and shall be payable from the first money received by the Office from such Pledged Revenues, and to the extent not so paid shall be paid from any other moneys of the Office lawfully available therefor. Unless this certificate is presented by an authorized representative of the Depository Trust Company, a New York corporation ("DTC"), to the issuer or its agent for registration of transfer, exchange or payment and any certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of the DTC (and any payment is made to Cede & Co.or to any such entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein. A-2 IN WITNESS WHEREOF, the Board of Supervisors has caused this Note to be executed by facsimile or manual signature, and countersigned by the Clerk of the County Board by facsimile signature or manual signature and has caused its official seal to be affixed hereto or a facsimile of its official seal to be printed hereon this day of 1996. COUNTY OF BUTTE [Seal] By: Assistant Treasurer Countersigned: By: Clerk of the Board of Supervisors A-3 1996 Butte County Office of Education 1859 Bird Street Oroville, California 95965 Re: Butte County Office of Education State of California 1996-1997 Tax and Revenue Participation Notes Dear Board Members: We have acted as bond counsel to the Butte County Office of Education (the "Office") in connection with the issuance by the Board of Supervisors of Butte Gounty (the "Board") of $ principal amount of Butte County Office of Education State of California 1996-1997 Tax and Revenue Anticipation Notes, dated 1996 (the "Notes"), pursuant to Article 7.6 (commencing with Section 53850), Chapter 4, Part 1, Division 2, Title 5 of the California Government Code, pursuant to the provisions of Resolution No. adopted by the Board of Education of the Office on July 8, 1996, and Resolution Na. adopted by the Board on July 23, 1996 (collectively, the "Note Resolution"). As to questions of fact material to our opinion, we have relied upon the representations of the Office contained in the Note Resolution and in the certified proceedings and other certifications of public officials furnished to us without undertaking to verify the same by independent investigation. Based upon the foregoing, we are of the opinion, under existing law, as follows: 1. The Office is duly created and validly existing as a county office of education with the power to cause the Board to issue the Notes on its behalf and to perform its obligations under the Note Resolution. 2. The Note Resolution has been duly adopted by the Board and creates a valid first lien on the funds pledged under the Note Resolution for the security of the Notes. A-~ 250632.1 3. The Notes have been duly authorized, executed and delivered by the Board and are valid and binding general obligations of the Office enforceable in accordance with their terms. 4. The interest on the Notes is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; it should be noted, however, for the purpose of computing the alternative minimum tax imposed an corporations (as defined for federal income tax purposes), such interest is taken into account in determining adjusted earnings. The opinions set forth in the preceding sentence are subject to the condition that the Office comply with all requirements of the Code that must be satisfied subsequent to the issuance of the Notes in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes. The Office has covenanted to comply with eacl-i such requirement. Failure to comply with certain of such requirements may cause the inclusion of interest on the Notes in gross income for federal income tax purposes to be retroactive to the date of issuance of the Notes. We express no opinion regarding other federal tax consequences arising with respect to the Notes. 5. Interest on the Notes is excluded from gross income for California personal income tax purposes. It is to be understood that the rights of the holders of the Notes and the enforceability of the Notes and the Note Resolution may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted to the extent constitutionally applicable, and that their enforcement may also be subject to the exercise of judicial discretion in appropriate cases. Very truly yours, KRONICK, MOSKOVITZ, TIEDEMANN & GIRARD A Professional Corporation A-5 2sossz.~ I HEREBY CERTIFY that the foregoing is a true and correct copy of the legal opinion upon the Notes therein described that was manually signed by Kronick, Moskovitz, Tiedemann & Girard, and was dated as of the date of delivery of and payment for said notes. Clerk of the Board of Supervisors 250626.1 A-6 RESOLUTION NO. 9 6 - ~ 5 RESOLUTION OF THE OFFICE OF EDUCATION OF BUTTE COUNTY AUTHORIZING THE ISSUANCE OF 1996-1997 TAX AND REVENUE ANTICIPATION NOTES FOR SAID OFFICE AND REQUESTING THE BOARD OF SUPERVISORS OF BUTTE COUNTY TO ISSUE SAID NOTES WHEREAS, pursuant to Sections 53850, et seq., of the Government Code of the State of California (the "Act") contained in Article 7.6 thereof, entitled "Temporary Borrowing," on or after the first day of any fiscal year (being July 1), the Butte County Office of Education (the "Office") may borrow money by issuing tax and revenue anticipation notes for any purpose for which the Office is authorized to expend moneys, including, but not limited to, current expenses, capital expenditures, and the discharge of any obligation or indebtedness of the Office; and WHEREAS, Section 53853 of the Act provides that such notes must be issued in the name of the Office by the Board of Supervisors of the county (the "County Board"), the county superintendent of which has jurisdiction over the Office, as soon as possible following the receipt of a resolution of the governing board of the Office requesting the borrowing; and WHEREAS, the County Superintendent of Butte County (the "County") has jurisdiction over the Office, and this Board of Education (the "Office Board"), being the governing board of the Office, hereby requests the borrowing of not to exceed Thirty Million Dollars ($30,000,000) at an interest rate not to exceed FIVE PERCENT {5°l0) through the issue by the County Board of 1996-1997 Tax and Revenue Anticipation Notes (the "Notes") in the name of the Office; and WHEREAS, the Office Board has found and determined that said $30,000,000 maximum principal amount of Notes to be issued by the County Board on behalf of the Office in fiscal year 1996-1997, when added to the interest payable thereon, does not exceed eighty-five percent (85%) of the estimated amount of the uncollected taxes, income, revenue {including, but not limited to, revenue from state and federal governments), cash receipts and other moneys of the Office which will be available for the payment of the Notes and interest thereon, as required by Section 53858 of the Act; and 250633.3 1 NOW, THEREFORE, the Board of Education of Butte County Office of Education hereby resolves as follows: Section 1. Findings. All of the above recitals are true and correct and the Office Board so finds and determines. Section 2. Authorization of Issuance of Notes; Terms Thereof; Paying Agent. The Office Board hereby authorizes the borrowing of an amount not to exceed $30,000,000 principal amount of and requests the County Board to issue in the name of the Office, Notes under Sections 53850, et seq., of the Act, designated "Butte County Office of Education, Butte County, State of California, 1996-1997 Tax and Revenue Anticipation Notes" (the "Notes"); to be numbered from 1 consecutively upward in order of issuance; to be in the denominations of $5,000, or integral multiples thereof, to be dated the date of delivery thereof; to mature (without option of prior redemption) one year from the date of delivery; and to bear interest, payable at maturity and computed on a 30-day month/360-day year basis, at the rate ar rates to be borne by the Notes, determined at the time of sale thereof, but not in excess of five percent (5°I°) per annum. Both the principal of and interest on the Notes shall be payable, only upon surrender thereof, in lawful money of the United States of America at the principal office of the Butte County Treasurer/Tax Collector, Oroville, California, which is hereby designated by this Board as the paying agent for the Notes (the "Paying Agent"). The Office Board hereby authorizes loans to be made to certain of those districts within the Office's jurisdiction (the "Districts") from the proceeds of the Notes, provided that such loans shall be repayable at a rate of interest, computed on a 30-day month1360-day year basis, at the rate to be borne by the Notes, and as otherwise provided in the resolutions of the Districts authorizing such loans (the "District Resolutions"). Section 3. Form of Notes. The Notes shall be in the form attached to the resolution entitled "Resolution of the Board of Supervisors of Butte County Authorizing the Issuance of the 1996-1997 Tax and Revenue Anticipation Notes far the Butte County Office of Education." That resolution, to be adopted by the County Board in substantially the form on file with the Secretary of the Office Board, is hereby approved. Section 4. Deposit of Note Proceeds; No Arbitrage. The moneys sa harrowed shall be initially deposited in the Treasury of the County in a proceeds fund to the credit of the Office and subsequently credited in the amount of the respective loans concurrently with the delivery of the District Notes to the respective general funds of the District. Until used or expended, the moneys may be invested in investments as permitted by applicable California law. The Office hereby covenants that it will make no use of the proceeds of the Notes that would cause the Notes to be "arbitrage bonds" 250633.3 2 under Section 148 of the Code; and, to that end, so long as any of the Notes are outstanding, the Office, and all of its officers having custody ar control of such proceeds, shall comply with all requirements of (a) said section, including restrictions on the use and investment of proceeds of the Notes and the rebate of a portion of investment earnings on certain amounts, including proceeds of the Notes, if required, to the Federal government, and (b) of the Income Tax Regulations of the United States Treasury promulgated thereunder or any predecessor provisions, to the extent that such regulations are, at the time, applicable and in effect, so that the Notes will not be "arbitrage bonds." Section 5. Payment of Notes. (A) Source of Payment. The principal amount of the Notes, together with the interest thereon, shall be payable from taxes, income, revenue, cash receipts, and other moneys which are received by the Office during fiscal year 1996-1997 and which are available therefor. The Notes shall be a general obligation of the Office, and, to the extent the Notes are not paid from the Pledged Revenues defined below, the Notes shall be paid with interest thereon from any other moneys of the Office lawfully available therefor, as provided herein and by law. (B} Pledged Revenues. The Notes shall be secured by a pledge of and first lien and charge against the first unrestricted revenues to be received by the County on behalf of the Office in such months and in such amounts as shall be determined by the Butte County Superintendent of Schools (the "Superintendent"), or the Superintendent's designee, prior to the date of the sale of the Notes, sufficient to pay the principal of and interest on the Notes at maturity (such pledged amounts being hereinafter called the "Pledged Revenues"). The term "unrestricted revenues" shall mean taxes, income, revenue, cash receipts, and other money of the Office as provided in Section 53856 of the Act, which are intended as receipts for the general fund of the Office and which are generally available for the payment of current expenses and other obligations of the Office, including, but not limited ta, those amounts paid by the Districts under the District Notes. The dates so designated shall constitute the "deposit dates" referred to in Section 5(B) of each District resolution. (C} Covenant Regarding Additional Short-Term Borrowing. The Office hereby covenants and warrants that it will not request the County TreasurerlTax Collector (in such capacity, the "County Treasurer") to make temporary transfers of funds in the custody of the County Treasurer to meet any obligations of the Office during the 1996-1997 fiscal year pursuant to the authority of Article XVI, Section 6, of the Constitution of the State of California or any other legal authority. 250633.3 3 (D) Deposit of Pledged Revenues in Repayment Fund. The Pledged Revenues shall be deposited in the County Treasury in the appropriate account in a special fund designated as the "Butte County Office of Education Tax and Revenue Anticipation Notes Repayment Fund" (herein called the "Repayment Fund") and applied as directed in this Resolution. Any moneys placed in the Repayment Fund shall be for the benefit of the holders of the Notes, and until the Notes and all interest thereon are paid or until provision has been made for the payment of the Notes at maturity with interest to maturity, the moneys in the Repayment Fund shall be applied only for the purposes for which the Repayment Fund is created. {E) Disbursement and Investment of Moneys in Repayment Fund. From the date this Resolution takes effect, all Pledged Revenues shall, when received, be deposited in the Repayment Fund to be held, invested and accounted for as provided herein. After such date as the amount of Pledged Revenues deposited in the Repayment Fund shall be sufficient to pay in full the principal of and interest on the Notes, when due, any moneys in excess of such amount remaining in or accruing to the Repayment Fund shall be transferred to the general fund of the Office upon the request of the Office. The Office hereby covenants to return to the respective District any amount received by the Office which represents any portion of a deposit made by the District described in Section 4 hereof and the investment earnings thereon. On the maturity date of the Notes, the moneys in the Repayment Fund shall be used, to the extent necessary, to pay the principal of and interest on the Notes. Moneys in the Repayment Fund shall be invested in investment securities by the County Treasurer, or such other appropriate investment officer of the County, directly, or through an investment agreement, in investments as permitted by applicable California law, as it is now in effect and as it may be amended, modified or supplemented from time to time, and the proceeds of any such investments shall, as received, be deposited in the Repayment Fund and shall be part of the Pledged Revenues. Moneys so invested, and the earnings thereon, shall be accounted for as Pledged Revenues, to be withdrawn solely for deposit in the Repayment Fund and used, to the extent necessary, to pay the principal of and interest on the Notes. Sufficient money for the payment of principal and interest far the maturing Notes must be placed into the Repayment Fund in the County Treasury at least one business day prior to the maturity of the Notes. Section 6. Execution of Notes. The Office hereby requests the County Treasurer, or designated deputy thereof, to sign the Notes manually or by facsimile signature; the Clerk of the County Board (the "Clerk") to countersign the Notes manually or by facsimile signature (provided at least one of the foregoing signatures is manual; the Clerk to affix the seal of the County or a facsimile of the seal thereto; and said officers to cause the blank spaces thereof to be filled in as may be appropriate. 250633.3 4 Section 7. Sale of the Notes. The Notes will be sold either at a private sale to an underwriter or underwriters upon terms and conditions as are acceptable to the Office and consistent herewith or by competitive bid and awarded as set forth in an Official Notice of Sale which the Financial Advisor and the County Superintendent, or his or her designee, are hereby authorized to prepare consistent with this Resolution. The County Treasurer, or his or her designee, is hereby authorized to decide between competitive or private sale in conjunction with advice from the financial advisor. If the sale is negotiated, the County Treasurer, or his or her designee, is authorized to negotiate the sale of no more than $30,000,000 of notes at an interest rate of not more than 5%. If the sale is by competitive bid, the Superintendent, or his or her designee, is hereby directed to execute, and the Clerk of the Office is directed to publish, the Official Notice of Sale. The County Treasurer, or his or her designee, is hereby authorized and directed to open the bids at the time and place specified in the Official Notice of Sale. The County Treasurer, or his or her designee, is hereby authorized and directed to receive and record the receipt of all bids made pursuant to the Official Notice of Sale, to cause said bids to be examined far compliance with the Official Notice of Sale, to cause computations to be made as to which bidder has bid the lowest true interest cost, as provided in the Official Notice of Sale, to announce the bidder of the lowest true interest cost, and to award the sale to said bidder, and to notify this Board and the County Board of the foregoing in accordance with this resolution and that of the County Board. Section 8. Paying Agent. The County Treasurer is hereby appointed to act as the registrar and Paying Agent of the Office for the purpose of receiving the payments of principal and interest made by the Office on the Notes at maturity, to hold, allocate, use, and apply said payments and to perform such other duties and powers of the Paying Agent as are prescribed in this Resolution. The Office shall compensate the County for the services of the County Treasurer for any expense determined by the County Treasurer. Section 9. Authorization of Preliminary Official Statement and Official Statement. The Official Statement relating to the Notes in preliminary form is hereby approved. The Superintendent, or his or her designee, is hereby authorized and requested to execute and deliver the Official Statement in substantially the form presented to the Office Board, with such changes and additions thereto deemed advisable by the Superintendent or any other qualified officer of the Office. The Office authorizes the distribution by the financial advisor of the Official Statement to prospective purchasers of the Notes, and authorizes and directs the Superintendent, or the Superintendent's designee, on behalf of the Office, to deem "final" pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 {the "Rule") the Official Statement 250633.3 5 prior to its distribution by the Office's financial advisor. The execution of the Official Statement, shall be conclusive evidence of the approval of the Official Statement by the Office. The Superintendent, or the Superintendent's designee, is separately authorized and directed to execute a statement that the facts contained in the Official Statement, and any supplement or amendment thereto (which shall be deemed an original part thereto for purposes of such statement) were, at the time of the sale of the Notes, true and correct and are material respects and that the Official Statement did not, an the date of the sale of the Notes, and does not, as of the date of the delivery of the Notes, contain any untrue statement of a material fact with respect to the Office or omit to state material facts with respect to the Office required to be stated or necessary to make any statement made therein not misleading in the light of the circumstances under which it was made. The Superintendent, or the Superintendent's designee, shall take such further action as prior to the signing of the Official Statement as are deemed necessary or appropriate to verify the accuracy thereof. The Superintendent, or his or her designee, is hereby authorized to execute, as necessary, a continuing disclosure certificate as may be required pursuant to subsection 15c2-12(b}(5}(i)(C) of the Rule. Section 10. Delivery of Notes. The proper officers of the County Board are hereby requested to deliver the Notes to the successful bidder when the County Treasurer has received confirmation of receipt of the proceeds. All actions heretofore taken by the officers and agents of the Office Board with respect to the Notes are hereby approved, confirmed, and ratified, and the officers of the Office Board are hereby authorized and directed to do any and all things and take any and all actions which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Notes in accordance with this Resolution, any supplemental resolution to this Resolution, and resolutions hereafter adopted by the County Board. Section 11. Financial Advisor. The Office Board hereby confirms the hiring of Government Financial Strategies, Inc., as financial advisor to the Office with respect to the sale of the Notes. Section 12. Bond Counsel. The Office Board hereby confirms the hiring of Kronick, Moskovitz, Tiedemann & Girard, as bond counsel to the Office with respect to the sale of the Notes. Section 13. Further Actions Authorized. All actions heretofore taken by the officers and agents of the Office Board with respect to the sale and issuance of the Notes are hereby approved, and the Superintendent, the Secretary of the Board and any 250633.3 6 and all other officers of the Office are hereby authorized and directed for and in the name and on behalf of the Office, to do any and all things and take any and all actions related to the execution and delivery of any and all certificates, requisitions, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Notes. The Secretary of the Board is hereby authorized and directed to file a certified copy of this Resolution with the County Board, which shall constitute the request of the Office that the County Board issue and sell the Notes as soon as practicable, and to simultaneously provide certified copies of this Resolution to the County Treasurer. PASSED AND ADOPTED by the Board of Education of the Butte County Office of Education this 8th day of July, 1996, by the fallowing vote: AYES: NOES: ABSENT: Attest: erk, oar o duration ~-~. _ 'Butte County Office of Education _ \ President, Board of Education Butte County Office Education Office 250633.3 7