$100,000,000
(consisting of 4,000,000 in $25 denominations of)
COUNTY OF SAN DIEGO
TAXABLE PENSION OBLIGATION BONDS,
SERIES 2002C (PUBLIC INCOME NOTES (PINES®))
No. R-1 Maximum Number of Bonds
issued as of October, 3, 2002:
4,000,000
THE OBLIGATIONS OF THE COUNTY HEREUNDER, INCLUDING THE
OBLIGATION TO MAKE ALL PAYMENTS OF INTEREST AND PRINCIPAL WHEN
DUE, ARE OBLIGATIONS OF THE COUNTY IMPOSED BY LAW AND ARE
ABSOLUTE AND UNCONDITIONAL, WITHOUT ANY RIGHT OF SET-OFF OR
COUNTERCLAIM. THIS BOND DOES NOT CONSTITUTE AN OBLIGATION OF
THE COUNTY FOR WHICH THE COUNTY IS OBLIGATED OR PERMITTED TO
LEVY OR PLEDGE ANY FORM OF TAXATION OR FOR WHICH THE COUNTY
HAS LEVIED OR PLEDGED OR WILL LEVY OR PLEDGE ANY FORM OF
TAXATION. NEITHER THE BONDS NOR THE OBLIGATION OF THE COUNTY
TO MAKE PAYMENTS ON THE BONDS CONSTITUTE AN INDEBTEDNESS OF
THE COUNTY, THE STATE OF CALIFORNIA, OR ANY OF ITS POLITICAL
SUBDIVISIONS WITHIN THE MEANING OF ANY CONSTITUTIONAL OR
STATUTORY DEBT LIMITATION OR RESTRICTION.
Interest Rate Maturity Date Original Issue Date CUSIP
6.125% August 15, 2032 October 3, 2002 79739R201
REGISTERED OWNER: CEDE & CO.
PRINCIPAL SUM: ONE HUNDRED MILLION DOLLARS
The County of San Diego, a political subdivision organized and
existing under and pursuant to the Constitution and laws of the State of
California (the "County"), for value received hereby, promises to pay to the
registered owner identified above or registered assigns, on the maturity date
specified above (subject to any right of prior redemption hereinafter provided
for) the principal sum specified above, together with interest on such principal
sum from the interest payment date next preceding the date of authentication of
this Bond (unless this Bond is authenticated as of an interest payment date or
during the period from the sixteenth day of the month preceding an interest
payment date to such interest payment date, in which event it shall bear
interest from such interest payment date, or unless this Bond is authenticated
prior to February 1, 2003, in which event it shall bear interest from the
original issue date specified above) until the principal hereof shall have been
paid at the interest rate per annum specified above, payable on February 15,
2003, and semiannually on each February 15 and August 15 thereafter until
maturity. Interest due on or before the maturity or prior redemption of this
Bond shall be payable only by check mailed on the Interest Payment Date by
first-class mail to the registered owner hereof; provided that upon the written
request of a Holder of $1,000,000 or more in aggregate principal amount of Bonds
received by the Trustee prior to the applicable record date, interest shall be
paid by wire transfer in immediately available funds. The principal hereof is
payable in lawful money of the United States of America at the Corporate Trust
Office of BNY Western Trust Company, as Trustee.
This Bond is one of a duly authorized issue of bonds of the
County designated as its "Taxable Pension Obligation Bonds, Series 2002C (Public
Income Notes (PINES®))" (the "Bonds") in aggregate principal amount of One
Hundred Million Dollars ($100,000,000), all of like tenor and date (except for
such variations, if any, as may be required to designate varying numbers,
maturities and interest rates), and is issued under and pursuant to the
provisions of the Articles 10 and 11 (commencing with Section 53570) of Chapter
3 of Division 2 of Title 5 of the Government Code of the State of California,
and all laws amendatory thereof or supplemental thereto (the "Bond Law") and
under and pursuant to the provisions of a Trust Agreement, dated as of February
1, 1994, between the County and BNY Western Trust Company, as trustee (the
"Trustee") as supplemented by a First Supplemental Trust Agreement dated as of
September 1, 2002, between the County and the Trustee (as so supplemented, the
"Trust Agreement") (copies of which are on file at the Corporate Trust Office of
the Trustee.
Under the Trust Agreement, Additional Bonds and other
obligations may be issued on a parity with the Bonds, but subject to the
conditions and upon compliance with the procedures set forth in the Trust
Agreement. The Bonds and any bonds or other obligations issued on a parity with
the Bonds are obligations imposed by law payable from funds to be appropriated
by the County pursuant to County Employees Retirement Law of 1937, Division 4 of
Title 3 of the Government Code of the State of California, Sections 31450
through 31899.10 (the "Retirement Law"). Reference is hereby made to the Bond
Law and to the Trust Agreement and any and all amendments thereof and
supplements thereto for a description of the terms on which the Bonds are
issued, the rights of the registered owners of the Bonds, security for payment
of the Bonds, remedies upon default and limitations thereon, and amendment of
the Trust Agreement (with or without consent of the registered owners of the
Bonds); and all the terms of the Trust Agreement are hereby incorporated herein
and constitute a contract between the County and the registered owner of this
Bond, to all the provisions of which the registered owner of this Bond, by
acceptance hereof, agrees and consents.
This Bond is subject to optional redemption prior to its
maturity, at the option of the County, in whole or in part in Authorized
Denominations, on any date on or after August 15, 2007, at a redemption price
equal to the principal amount hereof plus interest accrued hereon to the date
fixed for redemption.
Notice of redemption of any Bond selected for redemption shall
be given by first-class mail not less than thirty (30) days nor more than sixty
(60) days before the redemption date to the registered owner hereof, subject to
and in accordance with provisions of the Trust Agreement with respect thereto.
If notice of redemption has been duly given as aforesaid and money for the
payment of the above-described redemption price is held by the Trustee, then
this Bond shall, on the redemption date designated in such notice, become due
and payable at the above-described redemption price; and from and after the date
so designated, interest on this Bond shall cease to accrue and the registered
owner of this Bond shall have no rights with respect hereto except to receive
payment of the redemption price hereof.
If an event of default, as defined in the Trust Agreement,
shall occur, the principal of all Bonds (and any additional bonds authorized by
the Trust Agreement) may be declared due and payable upon the conditions, in the
manner and with the effect provided in the Trust Agreement; except that the
Trust Agreement provides that in certain events such declaration and its
consequences may be rescinded under the circumstances as provided therein.
Pursuant to Section 31584 of the County Employees Retirement
Law of 1937, the Board of Supervisors of the County is obligated to make
appropriations to pay the unfunded accrued actuarial liability which is
evidenced by the Bonds and pursuant to such Section the County Auditor shall
transfer from any money available in any fund in the County Treasury the sums
specified in the Board of Supervisors fails to make such appropriations.
This Bond is transferable only on a register to be kept for
that purpose at the above-mentioned office of the Trustee by the registered
owner hereof in person or by his duly authorized attorney upon payment of the
charges provided in the Trust Agreement and upon surrender of this Bond together
with a written instrument of transfer satisfactory to the Trustee duly executed
by the registered owner or his duly authorized attorney, and thereupon a new
fully registered Bond or Bonds in the same aggregate principal amount of
authorized denominations will be issued to the transferee in exchange therefor.
The County and the Trustee may deem and treat the registered owner hereof as the
absolute owner hereof for the purpose of receiving payment of the interest
hereon and principal hereof and for all other purposes, whether or not this Bond
shall be overdue, and neither the County nor the Trustee shall be affected by
any notice or knowledge to the contrary; and payment of the interest on and
principal of this Bond shall be made only to such registered owner, which
payments shall be valid and effectual to satisfy and discharge liability on this
Bond to the extent of the sum or sums so paid.
This Bond shall not be entitled to any benefit, protection or
security under the Trust Agreement or become valid or obligatory for any purpose
until the certificate of authentication and registration hereon endorsed shall
have been executed and dated by the Trustee.
It is hereby certified that all acts, conditions and things
required by law to exist, to have happened and to have been performed precedent
to and in the issuance of this Bond do exist, have happened and have been
performed in due time, form and manner as required by law and that the amount of
this Bond, together with all other indebtedness of the County, does not exceed
any limit prescribed by the Constitution or laws of the State of California and
is not in excess of the amount of Bonds permitted to be issued under the Trust
Agreement.
IN WITNESS WHEREOF, the County of San Diego has caused this
Bond to be executed in its name and on its behalf by the facsimile signature of
the County Treasurer and countersigned by the facsimile signature of the Clerk
of the Board of Supervisors, and has caused this Bond to be dated as of the
original issue date specified above.
COUNTY OF SAN DIEGO
By __________________________________
Treasurer
Countersigned:
By _________________________________
Clerk of the Board of Supervisors
STATEMENT OF INSURANCE
MBIA Insurance Corporation (the "Insurer") has issued a policy
containing the following provisions, such policy being on file at BNY Western
Trust Company, 700 South Flower Street, Suite 500. Los Angeles, CA 90017.
The Insurer, in consideration of the payment of the premium
and subject to the terms of this policy, hereby unconditionally and irrevocably
guarantees to any owner, as hereinafter defined, of the following described
obligations, the full and complete payment required to be made by or on behalf
of the Issuer to BNY Western Trust Company or its successor (the "Paying Agent")
of an amount equal to (i) the principal of (either at the stated maturity or by
any advancement of maturity pursuant to a mandatory sinking fund payment) and
interest on, the Obligations (as that term is defined below) as such payments
shall become due but shall not be so paid (except that in the event of any
acceleration of the due date of such principal by reason of mandatory or
optional redemption or acceleration resulting from default or otherwise, other
than any advancement of maturity pursuant to a mandatory sinking fund payment,
the payments guaranteed hereby shall be made in such amounts and at such times
as such payments of principal would have been due had there not been any such
acceleration); and (ii) the reimbursement of any such payment which is
subsequently recovered from any owner pursuant to a final judgment by a court of
competent jurisdiction that such payment constitutes an avoidable preference to
such owner within the meaning of any applicable bankruptcy law. The amounts
referred to in clauses (i) and (ii) of the preceding sentence shall be referred
to herein collectively as the "Insured Amounts." "Obligations" shall mean:
$100,000,000
COUNTY OF SAN DIEGO
TAXABLE PENSION OBLIGATION BONDS,
SERIES 2002C (PUBLIC INCOME NOTES (PINES®))
Upon receipt of telephonic or telegraphic notice, such notice
subsequently confirmed in writing by registered or certified mail, or upon
receipt of written notice by registered or certified mail, by the Insurer from
the Paying Agent or any owner of an Obligation the payment of an Insured Amount
for which is then due, that such required payment has not been made, the Insurer
on the due date of such payment or within one business day after receipt of
notice of such nonpayment, whichever is later, will make a deposit of funds, in
an account with State Street Bank and Trust Company, N.A., in New York, New
York, or its successor, sufficient for the payment of any such Insured Amounts
which are then due. Upon presentment and surrender of such Obligations or
presentment of such other proof of ownership of the Obligations, together with
any appropriate instruments of assignment to evidence the assignment of the
Insured Amounts due on the Obligations as are paid by the Insurer, and
appropriate instruments to effect the appointment of the Insurer as agent for
such owners of the Obligations in any legal proceeding related to payment of
Insured Amounts on the Obligations, such instruments being in a form
satisfactory to State Street Bank and Trust Company, N.A., State Street Bank and
Trust Company, N.A. shall disburse to such owners or the Paying Agent payment of
the Insured Amounts due on such Obligations, less any amount held by the Paying
Agent for the payment of such Insured Amounts and legally available therefor.
This policy does not insure against loss of any prepayment premium which may at
any time be payable with respect to any Obligation.
As used herein, the term "owner" shall mean the registered
owner of any Obligation as indicated in the books maintained by the Paying
Agent, the Issuer, or any designee of the Issuer for such purpose. The term
owner shall not include the Issuer or any party whose agreement with the Issuer
constitutes the underlying security for the Obligations.
Any service of process on the Insurer may be made to the
Insurer at its offices located at 113 King Street, Armonk, New York 10504 and
such service of process shall be valid and binding.
This policy is non-cancellable for any reason. The premium on
this policy is not refundable for any reason including the payment prior to
maturity of the Obligations.
In the event the Insurer were to become insolvent, any claims
arising under a policy of financial guaranty insurance are excluded from
coverage by the California Insurance Guaranty Association, established pursuant
to Article 14.2 (commencing with Section 1063) of Chapter 1 of Part 2 of
Division 1 of the California Insurance Code.
MBIA INSURANCE CORPORATION
STD-R/CA-1
CERTIFICATE OF AUTHENTICATION
This is one of the Bonds described in the within-mentioned Trust Agreement
which has been authenticated on ____________.
BNY Western Trust Company, as Trustee
By __________________________________
Authorized Signatory
[FORM OF ASSIGNMENT]
For value received the undersigned hereby sells, assigns and
transfers unto _________________ (Taxpayer Identification Number _________) the
within Bond and all rights thereunder, and hereby irrevocably constitutes and
appoints _____________ attorney to transfer the within bond on the books kept
for registration thereof, with full power of substitution in the premises.
Dated: ____________
Note: The signature to this Assignment must correspond with the name as written
on the face of the Bond in every particular, without alteration or enlargement
or any change whatever.
Signature Guaranteed: _________________________________________
Notice: Signature must be guaranteed by an eligible guarantor institution.
