HomeMy WebLinkAboutResolutions - 2014.01.22 - 21151MISCELLANEOUS RESOLUTION #14001 January 16, 2014
BY: FINANCE COMMITTEE - Thomas Middleton, Chairperson
IN RE: RESOLUTION APPROVING AND RATIFYING THE IRREVOCABLE ESCROW AGREEMENT,
PART II BETWEEN THE COUNTY OF OAKLAND AND THE HUNTINGTON NATIONAL BANK AS
ESCROW PART II AGENT
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Chairperson, Ladies and Gentlemen:
WHEREAS, the Oakland County VEBA (the "VEBA Trust") is a trust established by the Oakland
County VEBA Trust Agreement effective as of October 1, 2000 between the County and the Trustees
described therein (or their successors, the "VEBA Trustees"), as amended, for the purposes of (i)
accumulating the funds needed to pay for Retiree Medical Benefits and (ii) receiving contributions for that
purpose from the County; and
WHEREAS, pursuant to an enabling ordinance enacted by the Oakland County Board of
Commissioners on June 14, 2007 (the "Funding Ordinance") authorizing an alternate funding mechanism
for the County to amortize its estimated unfunded accrued actuarial liabilities for Retiree Medical Benefits
for certain retirees and certain active employees of the County, and their eligible dependents, as of
October 1, 2006 (the "Designated Liabilities") over a period ending April 1, 2027 (the "Funding Period");
and
WHEREAS, the County established an intermediate trust (the "Intermediate Trust") to irrevocably
receive a certain amount of the net proceeds (the "Funding Proceeds") from the sale by the 2007 Oakland
County Retiree Medical Benefits Funding Trust (the "Funding Trust") of its Taxable Certificates of
Participation, Series 2007 (the "Certificates") and to hold, invest and distribute to the Intermediate Trust
(defined below) assets, all in accordance with such trust agreement, as it may be amended in accordance
with its terms; and
WHEREAS, the County has authorized and entered into the 2007 Oakland County Retiree
Medical Benefits Contract (the "Contract") with the Funding Trust to assist it in exercising its essential
governmental function of providing post-retirement health benefits for its eligible employees, their
spouses and eligible dependents and in satisfying its contractual obligations to provide Retiree Medical
Benefits by issuing and selling the Certificates and the County has made Contract Payments to the
Funding Trust pursuant to the Contract in order to satisfy its obligations to the Funding Trust; and
WHEREAS, the Funding Trust provides:
In the event that any health care benefits plan, program or arrangement becomes
effective during the period that any Certificates are outstanding with the effect of
supplanting and superseding the County's obligations to pay for all of the costs of
providing retiree medical benefits (the Optional Prepayment Trigger), the Intermediate
Trust will have fulfilled its designated purpose, and then (i) all, or the applicable portion
(as the case may be), of the then existing assets of the Intermediate Trust, to the extent
no longer needed to pay future costs of providing County retiree medical benefits, shall
be deemed Surplus Intermediate Trust Assets, and (ii) if the County, at its option and in
its sole discretion, gives written notice to the Trustee, with a copy to the Trustees of the
Intermediate Trust, of the County's irrevocable election to optionally redeem all or a
portion (to the extent of the available Surplus Intermediate Trust Assets) of the then
outstanding principal amount of the Certificates through an Optional Prepayment as
defined in the Contract, then the Intermediate Trust shall (A) transfer all or a portion (as
the case may be) of the available Surplus Intermediate Trust Assets to the Trustee as
such optional prepayment for and on behalf of the County and (B) promptly give written
notice thereof to the County.
FINANCE COMMITTEE VOTE:
Motion carried unanimously on a roll call vote with Crawford absent.
WHEREAS, effective October 9, 2012, the Michigan legislature enacted an amendment to Public
Act No. 34 of the Public Acts of Michigan of 2001, as amended ("Act 34") into law. Said Act, as amended,
provided the County the power to take various actions in connection with refunding of the County's
existing contractual obligations under the Contract including establishing a new grantor trust to implement
the covering of the County's retirees health care liability which was the first step in permitting the County
to put in effect a new health care benefits "plan, program or arrangement" (the "Superseding Plan") which
will have the effect of supplanting and superseding the County's obligations under the Contract; and
WHEREAS, the County has issued $350,000,000 of refunding bonds (the "Refunding Bonds") for
the purpose of refunding, as permitted in Public Act No, 329 of the Public Acts of Michigan of 2012, the
existing obligations under the Contract which was the second step in implementing the Superseding Plan;
and
WHEREAS, the County was not contractually obligated to keep the VEBA Trust fully funded (and
in fact until September 30, 2013 the VEBA Trust was not fully funded as it had always had a retirees
medical benefit ("RMB") unfunded actuarial accrued liability ("UAAL") even after the Certificates were
issued); and
WHEREAS, as a part of a new "Plan, Program or Arrangement" the County, during the fall of
2013, undertook to contract with a new Superseding Trust to provide, through such Trust, a mechanism
which will keep the VEBA fund at a level where VEBA assets are always equal to at least 100% of the
amount necessary to avoid any RMB UAAL, if required through future ARC payments amortizing the
UAAL until such time as the UAAL is fully funded; and
WHEREAS, the County, as permitted by Act 34, created a new grantor trust, the 2013
Superseding Oakland County Retiree Medical Benefits Trust (the "Superseding Trust"), which will enter
into a new contract (the "Superseding Contract") with the County under which Superseding Contract, the
County will be obligated to the Superseding Trust to do the following:
A. Pay to the new grantor trust on April 1, 2014, an amount based on the
September 30, 2013 actuarial report received by the County from its actuary so that,
based on the actuarial assumptions contained therein, as of April 1, 2014 the VEBA
Trust will be fully funded with no retiree medical benefits ("RMB") unfunded actuarial
accrued liability ("UAAL"),
B. In all future years, after April 1,2014, transfer the actuarially required contribution
("ARC") as determined by the actuary to be made to the VEBA Trust no later than
eighteen months after the September 30th for which the actuarial report applies; and
WHEREAS, on October 31, 2013 the Oakland County Board of Commissioners adopted a
resolution approving the 2013 Superseding Oakland County Retiree Medical Benefits Plan (the
"Superseding Plan Resolution"); and
WHEREAS, the Superseding Plan Resolution authorized the Oakland County Executive or any
Deputy County Executive to execute and complete any and all steps in the Superseding Plan which
remained to occur after October 31, 2013; and
WHEREAS, the Superseding Plan Resolution authorized the Oakland County Executive or any
Deputy Oakland County Executive to certify to the Oakland County Clerk that all actions required to
complete the Superseding Plan have been completed which is conclusive evidence of the completion of
the Superseding Plan; and
WHEREAS, on December 9, 2013 the County entered into the Superseding Contract with the
Superseding Trust (which requires sufficient funds to be on deposit in the future in the VEBA Trust) the
ultimate beneficiaries of the new "plan, program or arrangement" (the County's employees and County's
taxpayers) are in a substantially better protected position than they are were before December 9, 2013;
and
WHEREAS, on December 12, 2013, Gerald D. Poisson, Chief Deputy Oakland County Executive
certified that the 2013 Superseding Oakland County Retiree Medical Benefits Plan was now complete
and in effect and on that same date filed a copy of his certification with the Oakland County Clerk; and
WHEREAS, on December 12, 2013 based upon various actions which had been taken between
November of 2012 and December 12, 2013, the County of Oakland received an opinion from Axe &
Ecklund, P.C. which provided as follows:
"1. As of July 31, 2007, the closing date of original issuance of the COPS, the
County was only obligated to provide health care benefits to its retirees pursuant to prior
labor contracts and pursuant to an ordinance (Ordinance No. 27, as amended by
Ordinance No 29) which codified its obligations under the labor contracts. As of the
date hereof, the County is now obligated by contract under a new program to provide for
the payment of such retiree health care benefits through a newly created Trust entitled
"2013 Superseding Oakland County Retiree Medical Benefits Trust" effective as of
October 3, 2013 (the "Superseding Trust"), under which Superseding Trust the County is
required to make annual transfers of assets to the Oakland County VEBA Trust from
which all County retirees health care defined benefits are paid pursuant to a Superseding
Contract made as of December 9, 2013.
2. This new contractual obligation of the County thereby has superseded the
arrangement which existed between July 31, 2007 and December 8, 2013, during which
time the COPS were outstanding obligations of the County under the 2007 Oakland
County Retiree Medical Benefits Funding Trust.
3. Since this new plan qualifies as a "plan, program or arrangement" as
described in Section 402 of the 2007 Oakland County Retiree Medical Benefits Contract
(the "Contract") between the 2007 Oakland County Retiree Medical Benefits Funding
Trust (the "Funding Trust") and the County, there now exists in the 2007 Oakland County
Intermediate Retiree Medical Benefits Trust ("Intermediate Trust") "Surplus Intermediate
Trust Assets" as defined in Subsection 402(c) of the Contract from which the County
may direct the Trustee of the Funding Trust as provided in Subsection 402(d) of the
Contract and in the optional redemption provisions of the COPS to call the COPS at the
County's option."
; and
WHEREAS, on December 12, 2013 Board of the 2007 Oakland County Intermediate Trust
authorized the following action:
"At any time the Treasurer of the 2007 Intermediate Trust shall receive instructions
from the County of Oakland to transfer "Surplus Intermediate Trust Assets" to
Huntington National Bank as Trustee of the 2007 Oakland County Retiree Medical
Benefits Funding Trust..., the Treasurer shall thereafter without further action of these
Trustees transfer those "Surplus Intermediate Trust Assets" to Huntington National
Bank."
; and
WHEREAS, on January 7, 2014, the County of Oakland and The Huntington National Bank,
Grand Rapids, Michigan, as Escrow Part II Agent, entered into the Irrevocable Escrow Agreement, Part ll
as authorized by the Order Authorizing the Execution of the Irrevocable Escrow Agreement, Part II in
connection with the $350,000,000 of County of Oakland Retirees Health Care Refunding Bonds, Series
2013A& Series 2013B (the "Order") a copy of which is attached hereto as Appendix I.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE
COUNTY OF OAKLAND, MICHIGAN, AS FOLLOWS:
1. The Order and the Escrow Agreement, Part II described in Appendix I attached hereto
are hereby approved and ratified, and the actions of the Oakland County Executive and the Oakland
County Treasurer in executing and delivering the Escrow Agreement, Part II are hereby ratified and
confirmed.
2. This resolution shall take immediate effect upon its adoption and the signature of the
Oakland County Executive indicating his approval.
Chairperson, on behalf of the Finance Committee, I move adoption of the foregoing resolution.
APPENDIX I
ORDER AUTHORIZING THE EXECUTION OF
THE IRREVOCABLE ESCROW AGREEMENT, PART II
IN CONNECTION WITH THE
$350,000,000
OF
COUNTY OF OAKLAND RETIREES HEALTH CARE
REFUNDING BONDS, SERIES 2013A & SERIES 2013B
January 7, 2014
WHEREAS, on the date of this Order, the undersigned, the
County Executive of the County of Oakland (the "County"), as
permitted in paragraph 1 of the bond resolution (Miscellaneous
Resolution No. 12299) adopted by the Oakland County Board of
Commissioners on November 28, 2012, as amended on June 13, 2013
by Miscellaneous Resolution No. 13147 (the "Bond Resolution") is
authorized to execute the Irrevocable Escrow Agreement, Part II
(the "Second Agreement") in connection with the issuance by the
County of County of Oakland Retirees Health Care Refunding Bonds,
Series 2013A and Series 20133 (the "Refunding Bonds"); and
WHEREAS, the purpose of the Refunding Bonds was to make
available sufficient funds to permit the County to take steps
subsequently which would permit the County to allow full funding
of the Oakland County VEBA Trust (the "VEBA"); and
WHEREAS, the full funding of the VEBA has been completed and
the County has adopted a "superseding plan, program or
arrangement" having the effect of superseding the County's
obligations to pay for the costs of providing Retiree Medical
Care Benefits (the "Superseding Plan"); and
WHEREAS, on December 12, 2013, the County's Superseding Plan
became effective as certified by the Chief Deputy Oakland County
Executive on December 12, 2013; and
WHEREAS, the 2007 Oakland County Intermediate Retiree
Medical Benefits Trust (the "Intermediate Trust") now holds
$422,135,000 in surplus assets (the "Surplus Assets"), which may
be transferred to the Escrow Part II Agent on the date of
execution of this Second Agreement at the option of County to
be subsequently used to redeem prior to maturity the Contract
Obligations which mature in the years 2015 through 2027 as
described in the Second Agreement (the "Redeemable Contract
Obligations"); and
WHEREAS, the County has the right to cause the Intermediate
Trust to transfer the Surplus Assets to the Escrow Part II Agent
to be used for the purpose of redeeming the Redeemable Contract
Obligations; and
NOW, THEREFORE, IT IS ORDERED BY THE COUNTY EXECUTIVE OF THE
COUNTY OF OAKLAND ON BEHALF OF THE COUNTY OF OAKLAND as follows:
1. The Irrevocable Escrow Agreement, Part II between the County
of Oakland and Huntington National Bank in the form attached
hereto as Appendix A with such changes and alterations as may be
approved by me or by my designee at the time it is executed on
behalf of the County is hereby approved.
2. Any Deputy County Executive or any one or more of them, and
each of them is, at any time hereafter and without further action
by me, authorized to execute the Irrevocable Escrow Agreement,
Part II as my designee in the form attached hereto as Appendix A
with such changes in or additions to such form (including but not
limited to, completing any blanks therein) as the Deputy County
Executive executing the same may determine to be necessary or
advisable and that the execution of the Irrevocable Escrow
Agreement, Part II by such a designee on behalf of this County
shall be conclusive evidence of their determination in that
respect.
Dated: January /, 2014
L. Brooks Pat rson
County Execu ive
County of Oakland
Dmh/ar-oak248 II
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APPENDIX A
Irrevocable Escrow Agreement Part II
I
IRREVOCABLE ESCROW AGREEMENT
PART II
COUNTY OF OAKLAND
This Irrevocable Escrow Agreement, Part II (the "Second
Agreement"), dated as of January 7, 2014, is between the COUNTY
OF OAKLAND, Michigan (the "County") and THE HUNTINGTON NATIONAL
BANK, Grand Rapids, Michigan, as escrow part II agent (the
"Escrow Part II Agent").
WHEREAS, the County has previously entered into the below
described contract under which it is obligated to make payments
for the costs of providing certain retiree medical benefits, of
which the principal amounts listed below remain outstanding:
Existing Contract
Oakland County Retiree Medical
Benefits Contract between the
2007 Oakland County Retiree
Medical Benefits Funding Trust
and the County of Oakland
dated as of July 1, 2007
Outstanding
Principal
$443,635,000
maturing in
the years
2014 through 2027
(all of such outstanding principal payment obligations being
hereinafter referred to as the "Contract Obligations") all
bearing interest, and due as to principal, as more fully
described in Appendix / to this Second Agreement; and
WHEREAS, because of the adoption of Act 329 of the Public
Acts of Michigan of 2012 the County has been authorized to take
action to adopt a "superseding plan, program or arrangement"
having the effect of supplanting and superseding the County's
obligations to pay for the costs of providing retiree medical
benefits (the "Superseding Plan"); and
WHEREAS, one of the steps in the Superseding Plan is the
funding of the Oakland County VEBA Trust (the "VEBA") at a level
where the total value of assets in the VEBA at least equals 100%
of the accrued actuarial liability of the County to the VEBA as
of the applicable date of determination; and
WHEREAS, for the purpose of achieving such full funding of
the VEBA, the County Board of Commissioners adopted a refunding
bond resolution on November 28, 2012 and an Amendment to Bond
Resolution on June 13, 2013 (together the "Refunding
Resolution") authorized the issuance of certain refunding bonds
as designated and described in the Refunding Resolution, which
bonds were issued and dated September 27, 2013 (the "Refunding
Bonds"); and
WHEREAS, on September 27, 2013, the County and the Escrow
Part II Agent entered into an Escrow Agreement, Part I (the
"First Agreement"); and
WHEREAS, pursuant to the First Agreement, on September 27,
2013, the County deposited $350,000,000 from the proceeds of the
Refunding Bonds with the Escrow Part II Agent for the account of
the County to establish the First Escrow Fund (as defined below)
as one of the County's necessary steps implementing the
Superseding Plan; and
WHEREAS, pursuant to the First Agreement, the Escrow Part
II Agent on September 27, 2013, used $348,800,000 of such bond
proceeds to purchase for the account of the County direct
obligations of, or obligations the principal of and interest on
which are unconditionally guaranteed by, the United States of
America ("US Government Securities"); and
WHEREAS, pursuant to the First Agreement, the Escrow Part II Agent purchased and held in the , First Escrow Fund
$348,800,000 of US Government Securities (more particularly
described in Appendix II attached hereto), which the Escrow Part
II Agent has transferred to the 2007 Oakland County Intermediate
Retiree Medical Benefits Trust (the "Intermediate Trust") as
instructed by the County; and
WHEREAS, on December 12, 2013, the County's Superseding
Plan became effective as certified by the Chief Deputy Oakland
County Executive on December 12, 2013; and
WHEREAS, the Intermediate Trust now holds $422,135,000 in
surplus assets (the "Surplus Assets") as more particularly
described in Appendix III attached hereto, which may be transferred to the Escrow Part II Agent on the date of execution
of this Second Agreement at the option of the County to be
subsequently used to redeem prior to maturity the Contract
Obligations which mature in the years 2015 through 2027 as
described in Appendix IV attached hereto (the "Redeemable
Contract Obligations"); and
WHEREAS, the County has the right to cause the Intermediate
Trust to transfer the Surplua Assets to the Escrow Part II Agent
to be used for the purpose of redeeming the Redeemable Contract
Obligations; and
WHEREAS, the County will on the date of execution of this
Second Agreement transfer or cause to be transferred to the
Escrow Part II Agent the amounts described in Appendix IV
attached hereto, which will permit the Escrow Part II Agent, in
its capacity as the Contract Obligations Paying Agent, to redeem
the Redeemable Contract Obligations on April 1, 2014; and
2
WHEREAS, the County will on the date of execution of this
Second Agreement transfer or cause to be transferred from County
Funds to the Escrow Part II Agent the amounts described in
Appendix V attached hereto, which will permit the Escrow Part II
Agent, in its capacity as the Contract Obligations Paying Agent,
to pay on April 1, 2014 the outstanding principal amount of the
Contract Obligations that mature on April 1, 2014, and interest
due that date an all outstanding Contract Obligations, in the
aggregate sum of $35,213,043.75; and
WHEREAS, the term "Authorized County Official" means any of
the persons named in Exhibit A attached hereto; and
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements set forth below, the County and
the Escrow Part II Agent agree as follows for the respective
equal and proportionate benefit and security of the holders of
the Contract Obligations;
Section 1.
(a) Definitions. Unless the context clearly indicates
otherwise, the following terms shall have the meanings assigned
to them below when they are used in this Second Agreement;
"Contract Obligations" hag the meaning given to such term
in the first WHEREAS paragraph above.
"212nractOoligs_pailAent" means the Huntington
National Bank, Grand Rapids, Michigan, in its capacity as Paying
Agent for the Contract Obligations.
"County" means the County of Oakland, Michigan.
"County Contract" means the Oakland County Retirees Medical
Benefits Contract between the 2007 Oakland County Retiree
Medical Benefits Funding Trust and the County of Oakland, dated
as of July 1, 2007.
"County Contract Ordinances" means the ordinances duly
adopted by the Board of Commissioners of the County on June 14,
2007, and amended July 19, 2007, authorizing the issuance, sale
and delivery of the Contract Obligations.
"Escrow Part II Agent" means the Huntington National Bank,
Grand Rapids, Michigan, and its successors as Escrow Part II
Agent under this Second Agreement.
"Second Escrow Fund" means the Oakland County Retiree
Medical Benefits Contract Obligations Second Escrow Fund created
and described in Section 3 of this Second Agreement.
"Intermediate Trust" means the 2007 Oakland County
Intermediate Retiree Medical Benefits Trust.
3
"Investment Securities" means those securities delivered to
the Escrow Part II Agent as described in Sections 3 and 5
hereof,
"Prepayment Receipt Day" means March 31, 2014 as required
by Section 6.01 and 7.01 of the County Contract.
"Redeemable Contract Obligations" means the Contract
Obligations in the aggregate outstanding principal amount of
$422,135,000, which mature in the years 2015 through 2027, as
more particularly described in Appendix IV attached hereto.
"Refunding Resolution" means the resolution duly adopted by
the Board of Commissioners of the County on November 28, 2012,
and amended on June 13, 2013, authorizing the issuance, sale and
delivery of the Refunding Bonds.
(b) Interpretations. The titles and headings of the
articles and sections of this Second Agreement have been
inserted for convenience and reference only and are not to be
considered a part hereof and shall not in any way modify or
restrict the terms hereof. This Second Agreement and all of the
terms and provisions hereof shall be liberally construed to
effectuate the purposes set forth herein and to achieve the
intended purpose of providing for the refunding of the
Redeemable Contract _Obligations in accordance with applicable
law.
Section 2. Continued and New Appointment of Escrow Part 11
Agent. This Escrow Agreement is separate from the First
Agreement, which remains in continuing effect. The Escrow Part
II Agent is already appointed and acting, and agrees to continue
to act, as the Escrow Part TT Agent under the First Agreement
and in such capacity agrees to comply with all requirements of
the First Agreement. The Escrow Part II Agent also accepts its
appointment under this Second Agreement and agrees to comply
with all requirements of this Second Agreement, to be custodian
of the Second Escrow Fund created under this Second Agreement
and to perform its duties as custodian of the Second Escrow
Fund, but only upon and subject to the following express terms
and conditions:
(a) The Escrow Part II Agent may perform any of its
duties by or through attorneys, agents, receivers or
employees but shall be answerable for the conduct of the
same in accordance with the Standards specified in this
Second Agreement and shall be entitled to advice of counsel
concerning all matters of and the duties under this Second
Agreement, and may in all cases pay such reasonable
compensation to such counsel and in addition to all such
attorneys, agents, receivers and employees as may
reasonably be employed in connection with the same. The
Escrow Part II Agent may act or refrain from acting and
shall be fully protected in so acting or refraining from
acting upon the opinion or advice of any counsel. The
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Escrow Part II Agent shall not be responsible for any loss
or damage resulting from any action or non-action taken in
good faith in reliance upon such opinion or advice.
(b) The Escrow Part II Agent shall not be responsible
for any recital in this Second Agreement, or in the
Refunding Bonds or for the validity of the execution by the
County of this Second Agreement or of any supplements to it
or instruments of further assurance. The Escrow Part II
Agent shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions or
agreements on the part of the County, except as set forth
in this Second Agreement. The Escrow Part II Agent shall
be only obligated to perform such duties and only such
duties as are specifically set forth in this Second
Agreement and no implied covenants or obligations shall be
read into this Second Agreement against the Escrow Part II
Agent.
(c) The Escrow Part II Agent may become ,the owner of
the Refunding Bonds or the Contract Obligations with the
same rights which it would have if not Escrow Part II
Agent.
(d) The Escrow Part II Agent shall be protected in
acting upon any notice, request, consent, certificate,
order, affidavit, letter, telex, telegram or other paper or
document believed to be genuine and correct and to have
been signed or sent by the proper person or persons.
(e) As to the existence or non-existence of any fact
or as to the sufficiency or validity of any instrument,
paper or proceeding, the Escrow Part II Agent shall be
entitled to rely upon a certificate of the County signed by
(i) an Authorized County Official, or (ii) any other duly
authorized person as sufficient evidence of the facts
contained in it, but may secure such further evidence
deemed necessary or advisable, but shall in no case be
bound to secure the same. The Escrow Part IT Agent may
accept a certificate of the Secretary of the Board of
Commissioners of the County to the effect that a resolution
in the form attached to such certificate has been adopted
by the County as conclusive evidence that such resolution
has been duly adopted, and is in full force and effect.
(f) The permissive right of the Escrow Part II Agent
to do things enumerated in this Second Agreement shall
never be construed as a duty. The Escrow Part II Agent
shall only be responsible for the performance of the
express duties outlined in this Second Agreement and it
shall not be answerable for other than its gross negligence
or willful default in the performance of those express
duties.
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(g) At any and all reasonable times the Escrow Part
II Agent and its duly authorized agents, attorneys,
experts, accountants and representatives, shall have the
right fully to inspect any and all of the books, papers and
records of the County pertaining to the Contract
Obligations, and to take such memoranda from and in regard
to the same as may be desired.
(h) The Escrow Part II Agent shall not be required to
give any bond or surety in respect of the execution of the
powers contained in or otherwise in respect to this Second
Agreement.
(i) Before taking any action under this Second
Agreement (except making investments, collecting investments and making payments to the paying agents with
respect to the Contract Obligations) the Escrow Part II
Agent may require that a satisfactory indemnity bond be
furnished for the reimbursement of all expenses to which it
may be put and to protect it against all liability except
liability which is adjudicated to have resulted from gross
negligence or willful default by reason of any action so
taken.
(j) The Escrow Part II Agent shall be, and hereby is,
indemnified and saved harmless from any liabilities, costs
and expenses, including reasonable attorney fees, acceptance of the Escrow Account or arising from the
performance of its duties hereunder, unless such losses,
liabilities, costs and expenses shall have been finally
adjudicated to have resulted from the bad faith or gross
negligence of the Escrow Part II Agent, and such
indemnification shall survive its resignation or removal,
or the termination of this Second Agreement, as permitted
by law.
(k) The Escrow Part II Agent shall, in the event that
(i) any dispute shall arise between the parties with
respect to the disposition or disbursement of any of the
assets held hereunder or (ii) the Escrow Fart II Agent
shall be uncertain as to how to proceed in a situation not
explicitly addressed by the terms of this Second Agreement,
be permitted to interplead all of the assets held hereunder
into a court of competent jurisdiction, and thereafter be
fully relieved from any and all liability or obligation
with respect to such interpleaded assets.
(1) The Escrow Part II Agent may obey and comply with
any order or process of a court (whether or not such court
shall have jurisdiction) commanding it to do or to refrain
from some act in relation to the subject matter of this
Escrow. It may rely and continue to rely conclusively upon
such orders or process, notwithstanding that it may be
found subsequently to be void or voidable, until one of the
officers of the Escrow Part II Agent, shall have actual
knowledge that such order or process shall have been
modified, annulled, set aside, vacated or quashed.
(m) The Escrow Part II Agent shall have only those
duties as are specifically provided herein, which shall be
deemed purely ministerial in nature, and shall under no
circumstance be deemed a fiduciary for the County. The
Escrow Part II Agent shall neither be responsible for, nor
chargeable with, knowledge of the terms and conditions of
any other agreement, instrument or document to which the
County is a party (other than the County Contract
Ordinances), in connection herewith. This Second Agreement
sets forth all matters pertinent to the escrow contemplated
hereunder, and no additional obligations of the Escrow Part
II Agent shall be inferred from the terms of this Second
Agreement or any other agreement. IN NO EVENT SHALL THE
ESCROW PART II AGENT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR
ANY (i) DAMAGES OR EXPENSES ARISING OUT OF THE SERVICES
PROVIDED HEREUNDER, OTHER THAN DAMAGES WHICH RESULT FROM
THE ESCROW PART II AGENT'S FAILURE TO ACT IN ACCORDANCE
WITH THE STANDARDS SET FORTH IN THIS SECOND AGREEMENT, OR
(ii) SPECIAL OR CONSEQUENTIAL DAMAGES, EVEN IF THE ESCROW
PART II AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
Section 3. Escrow Fund.
(a) On January 7, 2014 the County has irrevocably deposited
moneys with the Escrow Part II Ageht for the account of the
County from the Surplus Assets (as described in Appendix III
attached hereto) in the Intermediate Trust to establish in part
the Second Escrow Fund and to permit the Escrow Part II Agent to
call the Redeemable Contract Obligations on April 1, 2014.
(b) On January 7, 2014 the County irrevocably deposited
moneys with the Escrow Part II Agent (as described in Appendix
III attached hereto)for the account of the County to permit the
Escrow Part II Agent, in its capacity as the Contract
Obligations Paying Agent, to pay the principal and interest due
on April 1, 2014 on the Contract Obligations described in
Appendix V attached hereto.
(c) The Escrow Part II Agent has created on its books a
special and irrevocable escrow fund to be known as the Oakland
County Retiree Medical Benefits Contract Obligations Second
Escrow Fund. The Escrow Part II Agent hereby acknowledges that
there has been deposited to the credit of such Second Escrow
Fund the beginning cash balance as described in paragraphs (a)
and (b) above. All cash, securities and all proceeds therefrom
in the Second Escrow Fund, including assets acquired with such
proceeds, shall be the property of the Second Escrow Fund and
shall be applied only in strict conformity with the terms and
conditions of this Second Agreement. All of the escrowed
7
securities, all proceeds therefrom, including assets acquired
with such proceeds, and all cash balances from time to time on
deposit in the Escrow Fund hereby are pledged irrevocably to the
payment of the principal of and interest on the Contract
Obligations, which payment shall be made by timely transfers to
the Contract Obligations Paying Agent in such amounts and at
such times as are provided for in Section 4 hereof. When the
final transfers have been made to the Contract Obligations
Paying Agent for the payment of the principal of and interest on
the Contract Obligations in accordance with Appendix IV attached
hereto, any balance then remaining in the Second Escrow Fund, if
any, shall be transferred to the County, and the Escrow Part II
Agent thereupon shall be discharged from any further duties
hereunder.
(d) The County represents that the successive receipts of
the principal of and interest on the Investment Securities will
assure that the cash balance on deposit from time to time in the
Second Escrow Fund will be at all times sufficient to provide
moneys for transfer to the Contract Obligations Paying Agent at
the times and in the amounts required to pay the interest on the
Contract Obligations and to pay the principal of and interest on
the Redeemable Contract Obligations upon the redemption of the
Redeemable Contract Obligations, all as more fully set forth on
Appendix III attached hereto. If, for any reason, at any time,
the cash balances on deposit or scheduled to be on deposit in
the Second Escrow Fund shall be insufficient to transfer the
amounts required by the Contract Obligations Paying Agent to
make the payments set forth in paragraphs (a) and (b) of Section
4 hereof, the County shall deposit in the Second Escrow Fund
additional funds in the amounts required to make such payments
when due. Notice of any such insufficiency shall be given
promptly as hereinafter provided, but the Escrow Part II Agent
shall not in any manner be responsible for any insufficiency of
funds in the Escrow Fund or the County's failure to make
additional deposits thereto.
(e) The Escrow Part II Agent at all times shall hold the
Escrow Fund, the Investment Securities and all other assets of
the Escrow Fund as special trust funds but need not segregate
such funds and securities except to the extent required by law;
and it shall hold and dispose of the assets of the Escrow Fund
only as set forth herein. The Investment Securities and other
assets of the Escrow Fund always shall be maintained by the
Escrow Part II Agent as escrow funds for the benefit of the
holders of the Contract Obligations, and a special account
thereof at all times shall be maintained on the books of the
Escrow Part II Agent. The holders of the Contract Obligations
shall be entitled to a preferred claim and first lien upon the
Investment Securities, the proceeds thereof and all other assets
of the Escrow Fund. The amounts received by the Escrow Part II
Agent under this Second Agreement shall not be considered as a
banking deposit by the County, and the Escrow Part II Agent
shall have no right to title with respect thereto except in its
capacity as Escrow Part II Agent under the terms of this Second
8
Agreement. The amounts received by the Escrow Part II Agent
under this Second Agreement shall not be subject to warrants,
drafts Or checks drawn by the County or by the Contract
Obligations Paying Agent.
(f) Cash balances from time to time on deposit in the
Escrow Fund, to the extent not insured by the Federal Deposit
Insurance Corporation or its successor, shall be secured
continuously by a pledge of direct obligations of, or
unconditionally guaranteed by, the United States of America,
having a market value at least equal to such cash balances.
(g) The Escrow Part II Agent makes no representations as
to the value, conditions or sufficiency of the Escrow Fund, or
any part thereof, or as to the title of the County thereto, or
as to the security afforded thereby or hereby, and the Escrow
Part II Agent shall not incur any liability or responsibility in
respect to any of such matters.
Section 4. Duties of Escrow Part 11 Agent in Connection
with Redemption of Redeemable Contract Obligations and Payment
of the Contract Obligations Maturing on April 1, 2014.
(a) The Escrow Part II Agent is hereby directed by the
County to, and shall take all steps required by the County
Contract Ordinances (copies of which have been furnished to the
Escrow Part II Agent) to cause the Redeemable Contract
Obligations to be called for redemption on April 1, 2014. The
Escrow Part II Agent is hereby directed to take all action
legally required to effect the call of Redeemable Contract
Obligations on such date and in connection therewith, the Escrow
Part II Agent shall notify the Contract Obligations Paying Agent
not later than February 15, 2014, to take all steps required by
the County Contract Ordinances to call the Redeemable Contract
Obligations for redemption on April 1, 2014. Such notification
shall include instructions to the Contract Obligations Paying
Agent to mail by first-class Mail not later than February 28,
2014, a notice of redemption to the registered holders of each
of the outstanding Redeemable Contract Obligations at the
registered addresses as shown on the registration books kept by
the Contract Obligations Paying Agent on the day that such
notice is mailed.
(b) The County hereby directs the Escrow Part II Agent to
take all steps required by the Contract Obligations Ordinances
to enable and cause the Contract Obligations Paying Agent to pay
the principal of the Contract Obligations maturing on April 1,
2014 and to pay the interest due thereon on that date.
(c) Notwithstanding Sections 4(a) and (b), the Escrow Part
II Agent will have no obligation to take the steps identified
in those provisions unless and until it has received an executed
opinion of Bond Counsel in the form attached hereto as Appendix
VI.
9
Section 5. Investments. As directed by the County, moneys
deposited in the Escrow Fund shall be immediately invested in
direct obligations of the United States of America and/or
obligations the principal of, premium (if any) and interest on
which are fully guaranteed by the United States of America
("Investment Securities") to the extent not already so invested.
The "Investment Securities" to be purchased will be
selected by the County and the County's investment advisor will
provide to the Escrow Part II Agent the appropriate "Trade
Tickets".
The investment income from the Investment Securities in the
Escrow Fund shall be held in cash in the Escrow Fund and shall
not be reinvested. All moneys not invested as provided in this
Second Agreement shall be held by the Escrow Part II Agent as a
trust deposit until direction to release/disburse same is
provided to the Escrow Part II Agent.
Section 6. Use of Moneys. The Escrow Part II Agent has
already received payment of paying agents' fees on the Contract
Obligations and no other charges may be paid from the escrowed
moneys or Investment Securities prior to retirement of all
Contract Obligations, and the County agrees that it will pay any
such other fees from its other legally available funds as such
payments become due prior to such retirement.
Section 7. Deficiency in Second Escrow Fund. After this Second Agreement is executed and delivered, at such time or
times as there shall be insufficient funds on hand in the Escrow
Fund for the payment of the principal of, premium (if any) and
interest falling due on the Contract Obligations, the Escrow
Part II Agent shall promptly notify the County of such
deficiency, as provided for under Section 18 below.
Section 8. Reports to County. The Escrow Part II Agent
shall deliver to the Authorized Officials and the County
Treasurer a statement reflecting each transaction relating to
the Second Escrow Fund on April 30, 2014.
Section 9. Fees of Escrow Part II Agent and Costs of
Closing the Escrow.
(a) The Escrow Part II Agent agrees with the County that
the charges, fees and expenses of the Escrow Part II Agent
throughout the term of this Second Agreement shall be the total
sum of One Thousand Dollars ($1,000.00), which charges, fees and
expenses shall be paid from moneys deposited with the Escrow
Part II Agent by the County on the date this Second Agreement is
executed. The County agrees to reimburse the Escrow Part II
Agent for any and all reasonable expenses which it may have at
any time incurred in connection with the Second Agreement, and
shall indemnify and save the Escrow Part II Agent harmless from
any claims, liabilities, judgments, reasonable attorney's fees,
10
court costs and all other expenses of every kind and nature
which may at any time be incurred by reason of its acceptance
of, and its performance under, this Second Agreement. The
Escrow Part II Agent shall not be required, without its consent,
to relinquish, deliver or pay over any instrument, money or
other property deposited with it in this Second Agreement unless
and until it shall have been paid and reimbursed its fees and
expenses, as permitted by law.
(b) In addition to the fees of the Escrow Part 11 Agent,
there will be a fee of $1,750 which will be paid to Causey
Demgen & Moore, P.C., Denver, Colorado, for services as
Verification Agent in connection with the preparation of the
Verification Report as well as $2,500 to Robert W. Baird for
services as Bidding Agent for the County.
(c) On January 7, 2014, the County will deposit $5,250
with the Escrow Part II Agent to cover the cost of the Escrow
Part II Agent and the other costs specified in subparagraph (b)
above.
Section 10. Payments from Escrow Fund to Prepayment and
Retire the Contract Obligations. The Escrow Part IT Agent shall without further authorization or direction from the County,
collect the principal of and interest on the Investment
Securities promptly as the same shall become due and, to the
extent that Investment Securities and other moneys are
sufficient for such purpose, shall make timely payments out of
the Escrow Fund to the Contract Obligations Paying Agent as
follows: (a) $422,135,000 of which payments will be deposited in
the Funding Trust on the Prepayment Date, for the prepayment of
the principal of the Redeemable Contract Obligations and (b)
$35,213,043.15 to pay the principal and interest due on the
Contract Obligations which mature on April 1, 2014.
Section 11. Interest of Contract Obligation Holders Not Affected. After this Second Agreement has been executed and
delivered, the Escrow Part II Agent and the County recognize
that the holders from time to time of the Contract Obligations
have a beneficial and vested interest in the Investment
Securities and moneys to be held by the Escrow Part II Agent as
provided in this Second Agreement. It is therefore recited,
understood and agreed that once this Second Agreement has been
executed and delivered this Second Agreement shall not be
subject to revocation or amendment and no moneys on deposit in
the Second Escrow Fund for the Contract Obligations can be used
in any manner for bonds, notes, or other indebtedness of the
County.
Section 12. Escrow Part II Agent Not Obligated. None of the provisions contained in this Second Agreement shall require
the Escrow Part II Agent to use or advance its own moneys or
otherwise incur financial liability in the performance of any of
its duties or the exercise of any of its rights or powers under
this Second Agreement. The Escrow Part II Agent shall be under
'11
no liability for interest on any funds or other property
received by it under this Second Agreement, except as expressly
.provided.
Section 13. Payment of Other Amounts. The County agrees
that it will promptly and without delay remit to the Escrow Part
II Agent such additional sum or sums of money as may be
necessary to assure the payment of any Contract Obligations and
to fully pay and discharge any obligation or obligations or
charges, fees or expenses incurred by the Escrow Part II Agent
in carrying out any of the duties, terms or provisions of this
Second Agreement that are in excess of the sums provided for
under Sections 4 and 6 above.
Section 14. Segregation of Funds. The Escrow Part II Agent
shall hold the Investment Securities and all moneys received by
it from the collection of principal and interest on the
Investment Securities, and all moneys received from the County
under this Second Agreement, in a separate escrow account.
Section 15. Resignation of Escrow Part II Agent. The Escrow Part II Agent may resign as such following the giving of
thirty (30) days prior written notice to the County. 'Similarly,
the Escrow Part II Agent may be removed and replaced following
the giving of thirty (30) days prior written notice to the
Escrow Part II Agent by the County. In either event, the duties
of the Escrow Part II Agent shall terminate thirty (30) days
after the date of such notice (or as of such earlier date as may
be mutually agreeable); and the Escrow Part II Agent shall then
deliver the balance of the Second Escrow Fund then in its
possession to a successor Escrow Part II Agent as shall be
appointed by the County.
If the County shall have failed to appoint a successor
prior to the expiration of thirty (30) days following the date
of the notice of resignation or removal, the then acting Escrow
Part II Agent may petition any court of competent jurisdiction
for the appointment of a successor Escrow Part II Agent or for
other appropriate relief and any such resulting appointment
shall be binding upon the County.
Upon acknowledgment by any successor Escrow Part II Agent
of the receipt of the then remaining balance of the Second
Escrow Fund, the then acting Escrow Part II Agent shall be fully
released and relieved of all duties, responsibilities, and
obligations under this Second Agreement.
Section 16. Benefit. This Second Agreement shall be for
the sole and exclusive benefit of the County, the Escrow Part II
Agent and the holders of the Contract Obligations. With the
exception of rights expressly conferred in this Second
Agreement, nothing expressed in or to be implied from this
Second Agreement is intended or shall be construed to give to
any person other than the parties set forth above any legal or
12
equitable right, remedy or claim under or in respect to this
Second Agreement.
Section 17. Severabi1ity. If any provision of this Second
Agreement shall be held or deemed to be invalid or shall, in
fact, be illegal, inoperative or unenforceable, the same shall
not affect any other provision or provisions contained in this
Second Agreement or render the same invalid, inoperative or
unenforceable to any extent whatsoever.
Section 18. Notices. Any notice, request, communication or
other paper shall be sufficiently given and shall be deemed
given when delivered or mailed, by registered or certified mail,
postage prepaid or sent by facsimile transmission, except
reports as required in Section 8 which may be delivered by
regular mail, as follows:
If to the County:
COUNTY OF OAKLAND
Andrew E. Meisner, County Treasurer
1200 N. Telegraph Road
Pontiac, MI 48341-0479
If to the Escrow Part II Agent:
THE HUNTINGTON NATIONAL BANK
Ellen Campbell
The Huntington National Bank
Corporate Trust MI-230
50 Monroe Avenue NW,
Grand Rapids, MI 49503
The County and the Escrow Part II Agent may designate any
further or different addresses to which subsequent notices,
requests, communications or other papers shall be sent and shall
be required to provide written notification of said address
change.
Section 19. Governing Law, This Second Agreement shall be
governed by and construed in accordance with the laws of the
State of Michigan.
13
IN WITNESS WHEREOF, the parties to this Second Agreement
have duly executed it by their duly authorized officers as of
the date first above written.
COUNTY OF OAKLAND
By:
L. Brooks Patterson
Its: County Executive
By:
Andrew E. Meisner
Its: County Treasurer
THE HUNTINGTON NATIONAL BANK
(as Escrow Part II Agent)
By:
Its:
Dmh/ES II-OAK248(rf)
14
EXHIBIT A
AUTHORIZED COUNTY orricIALs
L. Brooks Patterson, Oakland County Executive
Gerald Poisson, Chief Deputy Oakland County Executive
Andrew E. Meisner, Oakland County Treasurer
Robert Daddow, Deputy Oakland County Executive
Laurie Van Pelt, Oakland County Director of the Department of
Management and Budget
Dmh/ES 11 -0AK248(rf)
1
APPENDIX
CONTRACT OBLIGATIONS
REMAINING ORIGINAL DEBT SERVICE SCHEDULE
WITH RESPECT TO $556,985,000 ORIGINAL PRINCIPAL AMOUNT OF
TAXABLE CERTIFICATE OF PARTICIPATION, SERIES 2007
Total
Data Principal Coupon Interest Debt Service Annual Total
04/01/14
10/01/14
04/01/15
10/01/15
04/01/16
10/01/16
04/01/17
10/01/17
04/01/16
10/01/16
04/01/19
10/01/19
04/01/20
10/01/20
04/01/21
10/01/21
04/01/22
10/01/22
04/01/23
10/01/23
04/01/24
10/01/24
04/01/25
10/01/25
04/01/26
10/01/26
04/01/27
21,500,000.00 6.00%
22,720,000.00 6.00%
23,940,000.00 6.00%
25,405,000.00 6.00%
26,675,000.00 6.00%
28,340,000.00 6.25%
29,805,000.00 6.25%
31,760,000.00 6.25%
33,465,000.00 6.25%
35,420,000.00 6.25%
37,620,000.00 6.25%
39,820,000.00 6.25%
42,260,000.00 6.25%
44,705,000.00 6.25%
13,713,043,75
13,068,043.75
13,066,043,75
12,386,443.75
12,386,443.73
11,668,243.75
11,668,293.75
10,906,093.75
10,906,093.75
10,099,843.75
10,099,843.75
9,214,218.75
9,214,218.75
8,282,812.50
6,282,812,50
7,290,312.50
7,290,312.50
6,244,531.25
6,244,531.25
5,137,656,25
5,137,656.25
3,962,031.25
3,962,031.25
2,717,656.25
2,117,656.25
1,397,031.25
1,397,031.25
35,213,043.75
13,068,043.75
35,788,043.75
12,386,443,75
36,326,443.75
11,666,243.75
37,073,293.75
10,906,093.75
37,781,093.75
10,099,843,75
36,439,843.75
9,214,216.15
39,019,218.75
8,282,812.50
40,042,812.50
7,290,312,50
40,755,312.50
6,244,531,25
41,664,531.25
3,137,656.25
42,757,656.25
3,962,031.25
43,762,031.25
2,717,656.25
44,977,656.25
1,397,031.25
46,102,031.25
46,281 0 087.50
46,174,487.50
47,994,687.50
47,979,337.50
47,860,937.50
47,654,062.50
97,302,031.25
47,333,125.00
46,999,643.75
46,802,167.50
46,719,667.50
46,499,667.50
46,374,687.50
46,102,031,25
8216,462,861.25 $662,097,881.25 1662,0 1,68 .25
1
APPENDIX IX
US Government Securities Purchased with bond proceeds of
$350,000,000 County of Oakland Retirees Health Care Refunding
Bonds, Series 2013A and Series 2013B
US Government Securities
Maturity CUSIP Type Yield Par Amount
03/27/2014 912796CE7 T-5111 0.022815% $348,800,000
Purchase Date Cost
09/27/2013 $348,760,543.74
US Government Securities Purchased with Surplus Assets from the
Intermediate Trust
Dmh/ES II -OAK248(rf)
1
APPENDIX I21
Surplus Assets totaling $422,135,000
which are held by the Intermediate Trust
which may be transferred to the Escrow Part II Agent
at the option of the County
US Government Securities transferred by Oakland County
(forwarded by the Oakland County Intermediate Trust pursuant to
instructions from Oakland County)
Maturity CUSIP Type Yield Par Amount
03/27/2014 912796CE7 T-Bill 0.022815% $348,800,000
Purchase Date Cost
09/27/2013 $348,760,543.74
US Government Securities Purchased with Surplus Assets from the
Intermediate Trust
On Tuesday, January 7, 2014, the Oakland County caused a wire
transfer in the amount of $73,335,000 to The Huntington National
Bank (the "Escrow Part II Agent") as described on Section 3(a)
of the Second Agreement.
The following US Government Securities were purchased with
proceeds of the wire transferred funds
Maturity CUSIP Type Yield Par Amount
Dath/ES 11 -0AK248(rf)
1
APPENDIX IV
Redeemable Contract Obligations
Debt Service Schedule
which total $422,135,000
in principal amount
Date Principal Coupon
10/01/2014 - -
04/01/2015 22,720,000.00 6.000%
10/01/2015 -
04/01/2016 23,940,000.00 6.000%
10/01/2016 - -
04/01/2017 25,405,000.00 6.000%
10/01/2017 - -
04/01/2018 26,875,000.00 6.000%
10/01/2018 - -
04/01/2019 28,340,000.00 6.250%
10/01/2019 - -
04/01/2020 29,805,000.00 6.250%
10/01/2020 -
09/01/2021 31,760,000.00 6.250%
10/01/2021 - -
04/01/2022 33,465,000.00 6.250%
10/01/2022 -
04/01/2023 35,920,000.00 6.250%
10/01/2023 - -
04/01/2024 37,620,000.00 6.250%
10/01/2024 - -
04/01/2025 39,820,000.00 6.250%
10/01/2025 - -
04/01/2026 42,260,000.00 6.250%
10/01/2026 - -
04/01/2027 94,705,000.00 6.250%
10/01/2027 - -
1
APPENDIX V
The County of Oakland is transferring or causing to be
transferred the $35,213,043.15 to pay the principal
and interest due on the Contract Obligations
which mature on April 1, 2014
US Government Securities Purchased with County funds
Maturity CU SIP Type Yield Par Amount
Purchase Date Cost
Dmh/ES II-OAK248(rf)
1
241,,RUIDIX VI
January 7, 2014
County of Oakland
Pontiac, Michigan
Re: $556,985,000 2007 Oakland County Retiree Medical Benefits Trust Taxable
Certificates of Participation, Series 2007 DEFEASANCE
We have acted as counsel to the County of Oakland (the "County") Michigan in
connection with the defeasance of $443,635,000 of the County's outstanding contractual
obligations to make contract payments to the 2007 Oakland County Retiree Medical Benefits
Funding Trust,(the "Funding Trust") which permits the Funding Trust to make payments to the
holders of the 2007 Oakland County Retiree Medical Benefits Funding Trust Taxable
Certificates of Participation, Series 2007, dated as of July 1, 2007 (originally issue in the
principal amount of $556,985,000) (the "Certificates") maturing in the years 2014 thru 2027,
which were issued to provide moneys to fund (on the date of original delivery of the Certificates)
specific amounts of the County's estimated unfunded accrued actuarial retiree medical benefits
liabilities and to pay costs of issuance of the Certificates (all of such outstanding Certificates are
referred to as the "CERTIFICATES TO BE DEFEASED").
On the date hereof, the County and The Huntington National Bank, Grand Rapids,
Michigan, as escrow agent (the "Escrow Agent"), have entered into an Irrevocable Escrow
Agreement Part II, dated as of January 7, 2014 (the "Escrow Agreement"), under which there has
been deposited with the Escrow Agent certain securities of the United States Treasury (the
"Investment Securities") for the purpose of paying, when due, the principal of and interest on the
CERTIFICATES TO BE DEFEASED. The firm of Causey Demgen & Moore, P.C., Denver,
Colorado has delivered a report (the "Verification Report") confirming the accuracy of the
arithmetical computation which establishes the adequacy of the Investment Securities deposited
with the Escrow Agent for such purpose. As a result of such deposit the CERTIFICATES TO
BE DEFEASED are no longer "outstanding" and are deemed to be legally defeased.
County of Oakland
January 7, 2014
Page Two
In rendering the foregoing opinion, we have relied upon the matters set forth in the
Verification Report, and have not independently undertaken to verify the adequacy of the
securities deposited with the Escrow Agent under the Escrow Agreement to provide moneys
sufficient to pay the principal, redemption premium and interest to become due with respect to
the CERTIFICATES TO BE DEFEASED from the date hereof to and including April 1, 2014,
the maturity and redemption date.
AXE & ECKLUND, P.C.
By:
Dmh/op-0AK248
Dmh/ES IT-OAK248(rf)
2
Resolution #14001 January 22, 2014
Moved by Spisz supported by Hatchett the resolutions (with fiscal notes attached) on the amended
Consent Agenda be adopted.
AYES: Gershenson, Gosselin, Hatchett, Hoffman, Jackson, Long, Matis, Middleton, Quarles,
Runestad, Scott, Spisz, Taub, VVeipert, Woodward, Zack, Bosnic, Crawford, Dwyer. (19)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the amended
Consent Agenda were adopted.
HEREBY APPROVE THIS RESOLUTION
CHIEF DE 0J1N rIVE
ACTING PURSUANT TO iviCL 45.559A (7)
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on January 22,
2014, with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 22nd day of January 2014.
Lisa Brown, Oakland County