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HomeMy WebLinkAboutResolutions - 2007.07.19 - 28433MISCELLANEOUS RESOLUTION #07168 MISCELLANEOUS ORDINANCE # 30 July 19, 2007 RESOLUTION #07XXX BY: Finance Committee, Mike Rogers, Chairperson IN RE: AN AMENDMENT TO ORDINANCE NO. 28, AN ORDINANCE TO ESTABLISH AN ALTERNATIVE FUNDING MECHANISM FOR OAKLAND COUNTY TO FULFILL ITS CONTRACTUAL OBLIGATIONS TO PROVIDE RETIREE MEDICAL BENEFITS FOR RETIREES AND CERTAIN ACTIVE EMPLOYEES OF THE COUNTY; TO AUTHORIZE THE FORMATION BY THE COUNTY OF AN OAKLAND COUNTY RETIREE MEDICAL BENEFITS FUNDING TRUST FOR THE PURPOSE OF ISSUING TAXABLE CERTIFICATES OF PARTICIPATION TO PROVIDE FUNDS TO PAY A SPECIFIED AMOUNT OF THE UNFUNDED ACCRUED ACTUARIAL LIABILITIES OF THE COUNTY FOR THE ESTIMATED COSTS OF FULFILLING SUCH OBLIGATIONS; TO APPROVE THE FORM OF A CONTRACT BETWEEN THE COUNTY AND SUCH FUNDING TRUST; AND TO AUTHORIZE THE FORMATION BY THE COUNTY OF AN OAKLAND COUNTY INTERMEDIATE RETIREE MEDICAL BENEFITS TRUST FOR USE IN CONNECTION WITH SUCH ALTERNATIVE FUNDING MECHANISM. THIS ORDINANCE DOES NOT INTEND TO AND DOES NOT RESCIND ANY SUBSTANTIVE RIGHTS, ENTITLEMENTS OR OBLIGATIONS WITH RESPECT TO BENEFITS EARNED OR ACCRUED OF RETIREES OR EMPLOYEES OF THE COUNTY OR THEIR DEPENDENTS. THIS ORDINANCE DOES NOT SUPERSEDE ANY CONFLICTING PROVISION OF ANY COLLECTIVE BARGAINING AGREEMENTS. TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS Chairperson, Ladies and Gentlemen: THE COUNTY OF OAKLAND ORDAINS: Section 1. Amendment to Section 3 of Ordinance No. 28. Section 3 of Ordinance No. 28, adopted by the Oakland County Board of Commissioners on June 14, 2007, is hereby amended to read in its entirety as follows: "Section 3. Legislative findings. The Board of Commissioners expressly finds and determines that: A. The Board of Commissioners is authorized by statute to provide for medical benefits for County retirees and their dependents, and to create reserves for the purpose of providing pension and other retirement benefits on a sound actuarial basis. FINANCE COMMITTEE Motion carried unanimously on a roll call vote with Potter and Coulter absent. Las.Jul 12 07 Item #19 Ord-Res Amend Ord #28.doc * c B. The County is contractually obligated to provide retiree medical benefits to eligible retired and active County employees and their dependents, as confirmed and restated in the Retiree Medical Benefits Contractual Obligations Ordinance adopted by the Board of Commissioners on the same date as the adoption of this ordinance. C. Maintaining the actuarial integrity of the County's retiree medical benefits program is an important public purpose to ensure that retirees obtain the medical benefits to which they are entitled. D. Pursuant to Resolution No. 00210 adopted by the Board of Commissioners on August 24, 2000 and a trust agreement effective as of October 1, 2000, the County established a voluntary employee benefit association trust ("VEBA Trust") as a vehicle for funding the County's contractual obligations to provide retiree medical benefits, which continues in full force and effect. The VEBA Trust provides the County a prudent means to pay the costs of providing these benefits when they come due and to create reserves for the purpose of maintaining the actuarial integrity of the County's system for funding these benefits. F. The County, in consultation with the VEBA Trust's actuary, has estimated that the County's unfunded accrued actuarial liabilities for retiree medical benefits for certain eligible retired and active employees of the County is $552,491,798 as of September 30, 2006 ("Subject RMB UAAL"). G. It is in the best interest of the County to authorize by this ordinance an alternative to its traditional mechanism for funding the costs of fulfilling its contractual obligations to provide retiree medical benefits (an "Alternative Funding Mechanism"), to better maintain the actuarial integrity of its retiree medical benefits program and to reduce the financial burden to the County of the Subject RMB UAAL. The Alternative Funding Mechanism will enable the County to enter into a transaction (the "Funding Transaction") to obtain funds to fund the Subject RMB UAAL. H. Toward that end, it is in the best interest of the County to authorize by this ordinance these elements of the Alternative Funding Mechanism: (i) the establishment 2 A of the Funding Trust (as defined in this ordinance), designed to work in conjunction with the Intermediate Trust (as defined in this ordinance) and the VEBA Trust, and (ii) the County's entering into a related contract with the Funding Trust as a means for the County to fund the Subject RMB UAAL. I. This ordinance shall not be deemed to affect any benefits under the County's retiree medical benefit program or other subjects of collective bargaining or Act 312 arbitration awards and shall be so interpreted." Section 2. Addition of Section 4A containing final changes to the form of 2007 Contract and Funding Trust. As a supplement to the provisions of Section 4, Section 4A of Ordinance No. 28 adopted by the Oakland County Board of Commissioners on June 14, 2007 is hereby added to read in its entirety as follows: "Section 4A. Amendments to Definitions of 2007 Contract and Funding Trust Agreement. (A) The form of 2007 Contract is changed by inserting the language in Appendix A attached hereto. Otherwise the balance of the form of 2007 Contract approved in Ordinance No. 28 remains as approved. (B) The form of Funding Trust Agreement is changed by inserting the language in Appendix B attached hereto. Otherwise the balance of the form of Funding Trust Agreement approved in Ordinance No. 28 remains as approved. Section 3. Amendment to Section 8 of Ordinance No. 28. Section 8 of Ordinance No. 28, adopted by the Oakland County Board of Commissioners on June 14, 2007, is hereby amended to read in its entirety as follows: "Section 8. The 2007 Contract. 3 ‘' A. The Chairperson of the Board of Commissioners and County Clerk are authorized to execute and deliver the 2007 Contract, in the name of and on behalf of the County, to fund the Subject RMB UAAL. B. The terms and conditions for the 2007 Contract shall be in substantially the form attached hereto as Appendix A, with such changes as may be approved by the Chairperson of the Board of Commissioners. C. The authority of the Chairperson of the Board of Commissioners to make changes or additions to the form of the 2007 Contract is subject to the limitations contained in this ordinance. D. The 2007 Contract will provide for payments to be made by the County ("Contract Payments") consisting of Scheduled Payments, Optional Prepayments and Contract Charges as set forth in the form of the 2007 Contract attached hereto as Appendix A. The annual amounts of the Scheduled Payments will be as set forth on Appendix C. The actual semi-annual amounts of the Contract Charges are as set forth on Appendix D. E. The 2007 Contract shall permit the sale of participation interests under the Funding Trust and in the Contract Payments of the County to be made thereunder in the form of Certificates of Participation. F. In addition to the Subject RMB UAAL, the aggregate amount of Scheduled Payments may include amounts, not in excess of one and eight-tenths percent (1.80%) of the Subject RMB UAAL acceptable to the Director of the Department of Management and Budget, in connection with the County's obtaining funds to fund the Subject RMB UAAL through the Funding Trust's issuance of Certificates of Participation, including Costs of Issuance (as defined in the 2007 Contract) and prefunded Contract Charges. G. Scheduled Payments shall be paid over a period of not more than twenty (20) annual payments, as determined by the Director of the Department of Management and Budget. 4 H. No Scheduled Payment shall be subject to mandatory prepayment or acceleration. Section 4. Severability. If any provision of this ordinance is held invalid, the invalidity does not affect other provisions that can be given effect without the invalid provision. Section 5. Effective Date. This ordinance shall become effective upon adoption by the Board of Commissioners and approval by the County Executive. Chairperson, on behalf of the Finance Committee, I move the adoption of the foregoing Ordinance. FINANCE COMMITTEE las.r8-ocvb5c 5 A roll call vote on the foregoing Ordinance was then taken, and was as follows: YES: NO: ABSTAIN: The Ordinance was declared adopted. STATE OF MICHIGAN ) )ss. COUNTY OF OAKLAND ) CERTIFICATION The undersigned, being the Clerk of the County of Oakland, hereby certifies that the foregoing is a true and complete copy of an Ordinance duly adopted by the County of Oakland Board of Commissioners at its meeting held on the day of , 2007, at which meeting a quorum was present and remained throughout and that an original thereof is on file in the records of the County. I further certify that the meeting was conducted, and public notice thereof was given, pursuant to and in full compliance with Act No. 267, Public Acts of Michigan, 1976, as amended, and that minutes of such meeting were kept and will be or have been made available as required thereby. COUNTY CLERK DATED: ,2007 Las.r8-ocvb5c 6 APPENDIX A 1. The following definition contained in Section 101 of the form of 2007 Contract is being completed as to read as follows: "Scheduled Payments means the amounts as set forth on the attached Schedule A as the "Scheduled Payments." 2. Sections 3.04, 4.02 and 4.03 of the Form of 2007 Contract are amended to read as follows: "Section 3.04 Disposition of Certificate Proceeds The Funding Trust shall apply the proceeds of the sale of Certificates in the following order: first, irrevocably paying $552,491,798 to the Intermediate Trust; second, paying the Costs of Issuance to the Persons entitled thereto; and third irrevocably paying any remaining portion of such proceeds to the Intermediate Trust." Section 4.02 Optional Prepayment of Scheduled Payments (a) The County shall not voluntarily prepay any Scheduled Payment (an Optional Prepayment) in whole or in part unless such voluntary prepayment is expressly permitted in this Contract. (b) Scheduled Payments due prior to April 1, 2015, shall not be subject to voluntary prepayment. The County may prepay the Scheduled Payments due on or after April 1, 2015 (each a Selected Scheduled Payment) in whole or in part on any Contract Charge Payment Date on or after April 1, 2014 by paying the Funding Trust an amount equal to the sum of (i) the outstanding balance or the permitted portion (as applicable) of the particular Selected Scheduled Payment being prepaid, plus (ii) Contract Charges accrued from the last Contract Charge Payment Date to which Contract Charges were paid in full on the particular Selected Scheduled Payment to the Optional Prepayment Date. No prepayment premium is required. (c) The County shall exercise its option to make any Optional Prepayment by delivering a Prepayment Notice to the Funding Trust at least 45 days (or such shorter period as is acceptable to the Trustee) before the Optional Prepayment Date on which the County shall pay the Total Prepayment Amount to the Funding Trust in connection with such Optional Prepayment. Such Prepayment Notice shall state: (1) the Scheduled Payments to be prepaid in whole or in part by such Optional Prepayment and the date on which such Scheduled Payments are to be prepaid (Optional Prepayment Date) subject to the following: 1 (i) a Scheduled Payment may be selected by the County only if it is permitted by this Contract to be prepaid on the particular Optional Prepayment Date, and (ii) a Scheduled Payment may be selected by the County for partial prepayment only in an amount of at least $100,000 unless otherwise provided in this Contract; (2) the Optional Prepayment Amount; (3) such information in tabular or other form so as to readily permit the Trustee to identify the Scheduled Payments selected for prepayment. (d) The delivery by the County of a Prepayment Notice to the Funding Trust is a statement of the intention of the County to pay the Total Prepayment Amount to the Funding Trust on the Prepayment Receipt Day for the Optional Prepayment Date stated therein, and it obligates the County to so pay the Total Prepayment Amount to the Funding Trust. (e) Any Total Prepayment Amount received by the Funding Trust shall be used on the Prepayment Receipt Date to satisfy each of the priorities set forth in Section 7.01 higher than clause Fifth. Section 4.03 Satisfaction of Scheduled Payments by Delivery of Certificates (a) The County may deliver or cause to be delivered Certificates to the Funding Trust in satisfaction (whether in whole or in part) of Scheduled Payments at any time and in any denomination upon 45 days' prior notice to the Funding Trust (or such shorter period as is acceptable to the Trustee) (a Delivery Notice) subject to the following limitations. (1) A Scheduled Payment may be satisfied by delivery of Certificates entitled to payment from such Scheduled Payment (Eligible Certificates). (2) The amount of a Scheduled Payment deemed paid shall be equal to the de- nominations of the particular Eligible Certificates. (3) No Certificate shall be delivered in payment in whole or in part of the respective Scheduled Payment more than 45 days before the respective due date if at the time of such delivery the County has not paid all Contract Payments then and theretofore due. (4) No Scheduled Payment shall be satisfied by the delivery of Certificates until such Certificates have been delivered to the Trustee. (b) All Certificates received by the Funding Trust in payment of Scheduled Payments pursuant to this Section shall be immediately canceled by the Trustee." 2 miliiiiiiiiii limy 1 1 MI iiirlinpli I • I_ Ii I iiiiii ill •Mililigilli NEI I _I 9ililliilt Mir I I - -lir 1111 Ill ill 1111111111111 III II ilmillillil Mild. 111 1111111111101111 11 1 _ imi .11011FIE 1 1 gl111111111111 • • 1 1 mil EIM ME 111 EMU it min .._ mil 01 pun 1 11 INE IIISIMIE HI num imimpumemi III l ,l 1511 MEI I i„ _• ogingpmm I 1; ti AM luolimi I, ii-1 wommuridial II _ „I ricilititil618i8litiwih8.-:ilicl- 1: .1111Jr1;1 A. EiligiggligiaiE218.,...gg.2 ""- 511gElli - III. trig.WP7-12RIERIEL748gts2. gs IF2nE:i 'V' -2,22222222222222282-8888 # 222222222.2 2 221.222.2n 22222222n 28882 882.82 8812820 28 .8.8.80.8 8 v s IxamA ARR.RR VilikARRR R RRARRAR. R ._ .... li III 11 8888888888/88 !88888888881888888888888188 III 1156111/TN E DER 2 1'2 H 2 P 1 1 5 1"WIH ou , Mgg.1,..L.,..N.Ig.,32,.A.E5.EAN.02.. 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The following definition contained in Section 101 of the form of Trust Agreement is changed to provide in its entirety as follows: "Stated Funding Amount means $556,985,000." 2. Sections 202, 203, 204, 404 and 405 of the form of Trust Agreement are amended to read as follows: "Section 202. Tax Treatment; Restriction on Trustee's Powers (a) Certificates will be issued and the Funding Trust will acquire the Funding Trust Receivables, with the intention that for U.S. federal, state and local income, business, franchise, gross receipts, modified gross receipts and modified value added tax purposes: (i). the Funding Trust will be treated as a grantor trust under Subpart E, Part I of Subchapter J of Chapter 1 of the Internal Revenue Code of 1986, as amended; (ii). each Beneficial Owner of Certificates will be treated as the owner of an undivided pro rata interest in the portion of the Funding Trust attributable to such Beneficial Owner's Certificates; and (iii). the Funding Trust Receivables will constitute payments in respect of indebtedness. (b) In furtherance of such intention, the Trustee shall not have the power to vary the investment of the Beneficial Owners of the Certificates within the meaning of U.S. Treasury Department regulations section 301.7701-4(c) or to engage in any business unless the Trustee shall have received an opinion in form and substance reasonably satisfactory to the Trustee of counsel reasonably acceptable to the Trustee to the effect that such activity will not cause the Funding Trust to fail to be treated as such a grantor trust. (c) The County and the Trustee by entering into this Trust Agreement and each Certificateholder by its acceptance of its Certificate agree to treat the Funding Trust, the Certificates and the Funding Trust Receivables in accordance with the intention expressed in this Section (or any alternative intention expressed in this Trust Agreement) for U.S. federal, state and local income, business, franchise, gross receipts, modified gross receipts and modified value added tax purposes. 1 Section 203. Authentication and Delivery of Certificates by Trustee; Execution of Other Documents The Trustee shall authenticate and deliver the Certificates in accordance with an order from the County (a Delivery Order) stating the amount of Certificate proceeds to be received by the Trustee and providing for the disposition of such proceeds in accordance with Section 204. Section 204. Disposition of Certificate Proceeds The proceeds of the sale of Certificates shall be applied as follows: (1) (1) The amount of $552,491,798 shall be irrevocably deposited in the Intermediate Trust for application in accordance with the Intermediate Trust Agreement. (2) Up to $4,493,202 shall be paid for the Costs of Issuance. The Costs of Issuance shall be paid by the Trustee to those parties designated in a notice signed by an Authorized County Official. The balance, if any, shall be irrevocably deposited in the Intermediate Trust for application in accordance with the Intermediate Trust Agreement. Section 404. Form of Certificates The Certificates shall be in substantially the form set forth in Appendix A, with such changes as are approved by the person executing the same on behalf of the Funding Trust, such signature to be conclusive evidence of such approval. Section 405. Authorized Principal Amount The Principal Amount of the Certificates on initial issuance shall equal the Stated Funding Amount of $556,985,000." 3. Appendix A, the form of Certificate as attached to the form of Trust Agreement, is amended to read as follows: (3) 2 Appendix A Form of Certificate The Certificate shall be in the following form and tenor with such changes as are approved by the Person executing the same on behalf of the Funding Trust, such signature to be conclusive evidence of such approval. NOTICE: Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (DTC) to the 2007 Oakland County Retiree Medical Benefits Funding Trust 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 DTC (and any payment is made to Cede & Co. or to such other 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 inasmuch as the registered holder hereof, Cede & Co., has an interest herein. R-1 2007 Oakland County Retiree Medical Benefits Funding Trust Taxable Certificate of Participation, Series 2007 FUNDING RATE PRINCIPAL EUROCLEAR AND (INTEREST RATE) PAYMENT DATE CLEARSTREAM PER ANNUM (MATURITY DATE) CUSIP ISIN COMMON CODE ORIGINAL ISSUE DATE: REGISTERED HOLDER: CEDE & Co. DENOMINATION (PRINCIPAL): This is to Certify that the Registered Holder, or registered assigns, is the registered owner of this certificate, which evidences a beneficial ownership interest in the trust estate (the Trust Estate) described in the Trust Agreement, dated (the Trust Agreement), between the below identified the , as trustee (such trustee and any successors as trustee, the Trustee). Capitalized terms not defined herein and defined in the Trust Agreement or in the Contract (as hereinafter defined) are used herein as therein defined. 3 This certificate is the only certificate of a series of certificates (the Certificates) issued by the 2007 Oakland County Retiree Medical Benefits Funding Trust created pursuant to this Trust Agreement (the Funding Trust), evidencing a beneficial ownership interest in the portion of the Trust Estate attributable to this certificate (as described in the following paragraph) and which represents the entire beneficial ownership interest in such portion of the Trust Estate. The portion of the Trust Estate attributable to this Certificate consists of rights to receive all those certain payments (Funding Trust Receivables as defined in this Trust Agreement) made by the County of Oakland (the County) pursuant to the 2007 Oakland County Retiree Medical Benefits Contract, dated as of July 1, 2007 (the Contract), between the County and The Huntington National Bank, Columbus, Ohio„ as Trustee, listed in the columns captioned "20 Scheduled Payment" and "20 Contract Charges @ %" on Schedule A to the Contract. Accordingly, the Registered Holder of this certificate is entitled to receive, subject to the terms of the Contract and this Trust Agreement, in lawful money of the United States of America: (i) on the Maturity Date stated above, a portion of the Scheduled Payments coming due on that date equal to the Principal amount stated above, unless earlier redeemed as provided below, and (ii) interest (the Interest) on this certificate, payable on October 1, 2007 and semiannually thereafter (each an Interest Payment Date), from the Original Issue Date stated above, or the most recent date to which Interest has been paid, to (but not including) the next Interest Payment Date, computed as the cost of capital of this certificate by multiplying the outstanding Principal amount of this certificate by the Interest Rate per annum stated above. Interest on this certificate shall be computed on the basis of a 360-day year comprised of twelve 30-day months. So long as the Registered Holder is Cede & Co., or any other nominee of DTC, distributions of Principal and premium, if any, payable upon maturity or earlier redemption of this certificate will be paid by the Trustee by wire. Distributions to any other Registered Holder will be paid by check or draft, mailed, with respect to distributions of Interest, to the Registered Owner shown in the Certificate registry kept by the Trustee at the close of business on the 15 th day (whether or not a business day) preceding the respective Interest Payment Date (a Regular Record Date) and, with respect to payment of Principal and premium, if any, upon presentation and surrender of this certificate at the designated office of the Trustee. Subject in all respects to the foregoing, this Trust Agreement and Contract provide for allocation, computation, distribution and payments from the Trust Estate to the Registered Holder and all other registered owners of the Certificates in accordance with their relative entitlements in the event that the Trustee has received less than all the Funding Trust Receivables payable on any date by the under the Contract. On each Interest Payment Date (ending on the Maturity Date set forth above) amounts are payable as Interest on this certificate from amounts the Trustee has received from the County as a Contract Charge for such Interest Payment Date, computed as stated above, provided that such Contract Charge is sufficient to pay Interest on all outstanding Certificates, computed in accordance with their respective terms on the aggregate outstanding Principal amounts of all outstanding Certificates. Such Interest is payable to the respective Record Holders as of the particular Regular Record Date immediately prior to such Interest Payment Date. 4 Any principal of any particular Certificate shall be reduced by any amount previously paid as principal (excluding any amount representing a prepayment premium) (such principal to the extent not so reduced outstanding Principal). Outstanding Principal of this certificate is payable on the Maturity Date to the Registered Holder hereof if the Trustee has received a Principal Payment. The Contract and certificates evidencing a beneficial interest in other portions of the Trust Estate provide for other payments (including payments on such certificates) to be made on a parity with or prior to Interest and Principal hereon, and those other payments may result in either Interest or Principal not being timely paid in full. Reference is made to the Contract for a statement of the applicable priorities of payments. Optional Redemption The Scheduled Payments may be subject to prepayment on and after at the option of the County, in any order, in whole or in part on any interest payment date on or after at par plus accrued interest to the date of the prepayment. Redemption from Redemption Payments correspondingly reduces Principal payable on the Maturity Date (and the amount on which Interest is computed following such redemption). The Registered Holder, by purchasing or acquiring this certificate, and each beneficial owner of this certificate, by purchasing or acquiring a beneficial ownership interest therein, agree that for all U.S. federal, state and local income, business, franchise, gross receipts, modified gross receipts and modified value added tax purposes, (i) they will treat the Funding Trust as a grantor trust under the Internal Revenue Code of 1986, as amended, (ii) they will be treated as the owner of an undivided pro rata interest in the portion of the Funding Trust attributable to this certificate, and (iii) they will treat the Funding Trust Receivables as payments in respect of indebtedness (and will thereby also acknowledge that the Contract Payments including Scheduled Payments, Optional Prepayment Amounts and the Contract Charges made by the County are payments in respect of indebtedness). This certificate is payable solely from Contract Payments which may be received by the Trustee pursuant to the Contract. Such Contract Payments will include Scheduled Payments and Contract Charges payable by the County under the Contract corresponding to the Principal of and Interest on the Certificates. The County's obligations to make Contract Payments are unsecured contractual obligations of the County, enforceable in the same manner as any other contractual obligation of the County. Such payment obligations of the County are not general obligations of the County, and neither the faith and credit, taxing power nor any specific revenues of the County are pledged to the Contract Payments coming due under the Contract. The County's unconditional contractual obligation to pay all Contract Payments is not "subject to appropriation," as is customary with many certificate of participation transactions entered into by municipalities in the United States. The County's Contract is not subject to termination if the County were to fail to appropriate sufficient amounts for the required payments in any single year. The County is legally bound to make all Contract Payments for the full term of the Contract, and statutory remedies, including, but not limited to, the Revised Judicature Act 5 4. of 1961, Act No. 236 of the Michigan Public Acts of 1961, as amended, (Michigan Compiled Laws Section 600.6093), exist to enforce the County's obligations. Reference is hereby made to this Trust Agreement and the Contract (copies of which and other documents related to the Certificates are on file at the designated office of the Trustee, located in on the Original Issue Date) for a description of the rights, responsibilities, and remedies of the Certificateholders and the Trustee. Notice of Redemption shall be mailed by first-class mail, not less than 30 days nor more than 45 days before the Redemption Date, to the Registered Holder of this certificate, as shown on the Certificate registry kept by the Trustee, but neither failure to receive notice of redemption given as provided in this Trust Agreement nor any defect in the notice so mailed shall affect the sufficiency of the proceedings for redemption of any Certificates for which no failure or deficiency occurred. This Trust Agreement provides that the Trustee shall provide additional notice that provides material compliance with Securities Exchange Act Release No. 34-23856 (December 3, 1986) as the same may be modified, amended or supplemented from time to time by formal action of the Securities and Exchange Commission or by generally accepted practice of corporate trustees. No failure to give such additional notice or defect therein or in the manner in which given shall affect the sufficiency of the proceedings for the redemption of any Certificates. If this certificate is duly called for Redemption and payment is duly provided therefor as specified in this Trust Agreement, this certificate shall cease to accrue Interest from and after the date fixed for Redemption. The ownership of this certificate is transferable only upon the Registry kept by the Trustee at the designated corporate trust office of the Trustee by the Registered Holder hereof in person, or by such Registered Holder's attorney duly authorized in writing, upon the surrender of this certificate together with a written instrument of transfer satisfactory to the Trustee duly executed by the Registered Holder or such Registered Holder's attorney duly authorized in writing, and thereupon a new registered certificate or certificates of the same tenor, representing the same denomination in the aggregate and having the same Maturity Date shall be issued to the transferee in exchange therefor as provided in this Trust Agreement and upon the payment of the charges, if any, therein prescribed. This certificate is not valid for any purpose until the Trustee's Certificate of Authentication on this certificate has been executed by the Trustee. [The Trustee's Certificate of Authentication follows] 6 Certificate of Authentication This certificate is one of the Certificates described in the within-mentioned Trust Agreement. as Trustee of the Funding Trust By: Date of Authentication: 7 Assignment FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto (Please print or typewrite name and address of transferee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints attorney to transfer the within certificate on the books kept for registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: The signature(s) to this assignment must correspond with the name as it appears upon the face of the within certificate in every particular, without alteration or enlargement or any change whatsoever. When assignment is made by a guardian, trustee, executor or administrator, an officer of a corporation, or anyone in a representative capacity, proof of such person's authority to act must accompany the certificate. 8 Signature(s) must be guaranteed by an eligible guarantor institution participating in a Securities Transfer Association recognized signature guarantee program. The Transfer Agent will not effect transfer of this certificate unless the information concerning the transferee requested below is provided. Name and Address: PLEASE INSERT SOCIAL SECURITY NUMBER OR OTHER IDENTIFYING NUMBER OF (Include information for all joint owners TRANSFEREE if the certificate is held by joint account.) (Insert number for first named Transferee if held by joint account) 9 APPENDIX C ANNUAL AMOUNTS OF THE SCHEDULED PAYMENTS YEAR 2015 2016 2017 2018 2019 2020 2021 SCHEDULED YEAR PAYMENT 2008 $20,765,000 2009 16,610,000 2010 17,590,000 2011 18,320,000 2012 19,545,000 2013 20,520,000 2014 21,500,000 SCHEDULED PAYMENT YEAR $22,720,000 2022 23,940,000 2023 25,405,000 2024 26,875,000 2025 28,340,000 2026 29,805,000 2027 31,760,000 SCHEDULED PAYMENT $33,465,000 35,420,000 37,620,000 39,820,000 42,260,000 44,705,000 1 • APPENDIX D ACTUAL ANNUAL AMOUNT OF THE CONTRACT CHARGES The actual semi-annual amounts of the Contract Charges are shown below: Interest Contract Date Rate Charges 10/01/07 $8,556,771.88 04/01/08 6.000% 17,113,543.75 10/01/08 16,490,593.75 04/01/09 6.000% 16,490,593.75 10/01/09 15,992,293.75 04/01/10 6.000% 15,992,293.75 10/01/10 15,464,593.75 04/01/11 6.000% 15,464,593.75 10/01/11 14,914,993.75 04/01/12 6.000% 14,914,993.75 10/01/12 14,328,643.75 04/01/13 6.000% 14,328,643.75 10/01/13 13,713,043.75 04/01/14 6.000% 13,713,043.75 10/01/14 13,068,043.75 04/01/15 6.000% 13,068,043.75 10/01/15 12,386,443.75 04/01/16 6.000% 12,386,443.75 10/01/16 11,668,243.75 04/01/17 6.000% 11,668,243.75 10/01/17 10,906,093.75 04/01/18 6.000% 10,906,093.75 10/01/18 10,099,843.75 04/01/19 6.250% 10,099,843.75 10/01/19 9,214,218.75 04/01/20 6.250% 9,214,218.75 10/01/20 8,282,812.50 04/01/21 6.250% 8,282,812.50 10/01/21 7,290,312.50 04/01/22 6.250% 7,290,312.50 10/01/22 6,244,531.25 04/01/23 6.250% 6,244,531.25 10/01/23 5,137,656.25 04/01/24 6.250% 5,137,656.25 10/01/24 3,962,031.25 04/01/25 6.250% 3,962,031.25 10/01/25 2,717,656.25 04/01/26 6.250% 2,717,656.25 10/01/26 1,397,031.25 04/01/27 6.250% 1,397,031.25 Las.Jul 12 07 Item #19 Ord-Res Amend Ord #28.doc z o -RutIrTerlfiTon, County Clerk Resolution #07168 — (Ordinance #30) July 19, 2007 Moved by Rogers supported by KowaII the resolution be adopted. AYES: Douglas, Gershenson, Gingell, Gosselin, Gregory, Greimel, Hatchett, Jacobsen, KowaII, Long, Middleton, Nash, Potter, Potts, Rogers, Scott, Spector, Suarez, Zack, Bullard, Burns, Crawford. (22) NAYS: None. (0) A sufficient majority having voted in favor, the resolution was adopted. I IEREBY APPROVE DIE FOREGOING FORUM STATE OF MICHIGAN) COUNTY OF OAKLAND) I, Ruth Johnson, 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 July19, 2007, 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 19th day of July, 2007.