HomeMy WebLinkAboutAgenda - 04-21-1998 - 8dORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: April 21, 1998
Action Agenda
Item No. ~ _d
SUBJECT: Resolution Approving a Modification for the Southern Village Elementary Financing
Documents
DEPARTMENT: Finance
PUBLIC H1:AK11Vli: (Y/ir)
BUDGET AMENDMENT: (Y/N)
ATTACHMENT(S): INFORMATION CONTACT:
Resolution and Modification Agreement Ken Chavious Ext. 2453
Prepazed by Bond Counsel .
TELEPHONE NUMBERS:
Hillsborough 732-8181
Chapel Hill 968-4501
Durham 688-7331
Mebane 227-2031
PURPOSE: To consider the adoption of a resolution approving a modification agreement to the
Southern Village Elementary School Financing documents.
BACKGROUND: On November 1996 the County Commissioner accepted a financing proposal
for $14 million from BB&T for the construction of the Southern Village Elementary School. The
proposal accepted by the Board contained a very favorable fixed interest rate of 4.92% and a 15 year
financing term. The initial financing proposal from BB&T included a conventional amortization
schedule which contained level principal and interest payments beginning in August of 1997.
However, staff subsequently requested a financing structure from BB&T which included only
interest payments in 1997-98 with principal payments beginning in August of 1998. Funds made
available from this restructuring were to be used to fund other school capital projects in the 1997-98
CIP. The Boazd accepted the BB&T proposal containing the restructured amortization schedule.
The closing for the Southern Village financing occurred on December 18, 1996. Among the
documents included at the closing was the Installment Purchase Agreement reflecting the initial
"conventional" amortization schedule. The closing documents were inadvertently filed with the
inclusion of the conventional amortization schedule. The County's Bond Counsel has prepared the
attached resolution to carry out needed corrections. The modification has no effect on the term or
interest rate contained in the original agreement. It is needed in order to correctly reflect the
repayment schedule which is being observed by the County and the bank. BB&T has
acknowledged the need for the modification.
RECOMMENDATION(S): The Manager recommends that the Board adopt the resolution
and authorize the Chair to execute the Modification Agreement.
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Resolution Approving a Modification for Southern Village Elementary
Financing Documents, To Correct the Payment Scherlnlps
WHEREAS:
In late 1996 and early 1997, Orange County, North Carolina (the "County"), entered into
financing agreements for Southern Village Elementary School.
There has been presented to this meeting a draft dated March 19, 1998, of a Modification
Agreement (the "Agreement") related to such financing agreements. The Agreement provides
for an adjustment to the payment schedules for the financings. These adjustmens will bring the
payment schedules in line with the County's overall capital improvement program, as intended at
the time of the financings.
BE IT THEREFORE RESOLVED by the Orange County Board of Commissioners,
as follows:
1. The Chair and Vice Chair of the County's Board of Commissioners, or either of
them, are hereby authorized and directed to execute and deliver the Agreement, and the Clerk to
this Boazd (or any assistant clerk) is hereby authorized and directed to affix the County's seal to
the Agreement and to attest the same. The Agreement shall be in substantially the form
submitted to this meeting, which is hereby approved, with such changes as may be approved by
the Chair or Vice Chair, such officer's execution to constitute conclusive evidence of such
officer's approval of any such changes.
2. The County's officers are hereby authorized and directed to take all such further
action as they may consider necessary or desirable in connection with the execution and delivery
of the Agreement and the consummation of the transactions contemplated thereby. The County
Finance Officer is hereby authorized and directed to hold executed copies of the Agreement, and
any other documents authorized or permitted by this resolution, in escrow on the County's behalf
until the conditions for the delivery of such documents have been completed to such officer's
satisfaction, and thereupon to release the executed copies of such documents for delivery to the
appropriate persons or organizations.
3. All other actions of County officers in furtherance of the purposes of this
resolution are hereby ratified, approved and confirmed. All other resolutions, or parts thereof, in
conflict with this resolution are hereby repealed to the extent of the conflict. This resolution
shall take effect immediately.
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Draft of March 19, 1998
Prepazed By and Return After
Recording To:
Robert M. Jessup, Jr.
Post Office Box 3168
Chapel Hill, NC 27515
This instrument has been preaudited in the
manner required by The Local Government
Budget and Fiscal Control Act.
Kenneth T. Chavious
Finance Officer
Orange County, North Cazolina
MODIFI ATION AGREEMENT.
STATE OF NORTH CAROLINA) COLLATERAL IS OR INCLUDES FIXTURES
ORANGE COUNTY )
THIS MODIFICATION AGREEMENT (this "Modification Agreement") is dated as
of , 1998, and is granted by ORANGE COUNTY, NORTH CAROLINA, a public
body of the State of North Cazolina (the "County"), to F. Louis Loyd, III, a citizen and resident
of Mecklenburg County, North Carolina, as trustee (the "Deed of Trust Trustee"), for the benefit
of BB&T GOVERNMENTAL FINANCE ("BB&TGF"), which is an operating unit of Branch
Banking & Trust Company of North Carolina.
This Modification Agreement, among other things, modifies and amends a
Financing Agreement and Deed of Trust (the "Original Agreement") dated as of December
1, 1996, which was recorded on December 19, 1997, at Book 1536, Page 459, Orange
County Registry, and a previous Modification Agreement (the "Prior Modification") dated
as of March 1, 1997, and recorded at Book 1564, Page 163, Orange County Registry.
BB&TGF is the assignee of BB&T Leasing Corporation's rights as beneficiary under the
Original Agreement. The current scheduled date for final repayment of amounts to be paid by the
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County pursuant to the Original Agreement and the Prior Modification remains on or about
February 1, 2012.
The North Carolina Local Government Commission joins in the execution of this
instrument for the purpose of evidencing its approval of the modifications effected by this
instrument.
The parties desire to modify the Original Agreement, as modified by the Prior
Modification. The purpose of the modification is to provide for an adjustment of the principal
and interest payments payable under the Original Agreement, as modified by the Prior
Modification.
The security interest evidenced hereby is a "construction mortgage" within the meaning
of N.C. Gen. Slat. § 25-9-313.
Now, therefore, for and in consideration of the premises, and for the purposes
described in the Original Agreement and the Prior Modification, the County covenants and
agrees with the Deed of Trust Trustee and BB&TGF (and their respective heirs, successors
and assigns), as follows:
1. Exhibit D to the Original Agreement, as modified by the Prior Modification, is
hereby amended to read as set forth on Exhibit A attached to this Modification Agreement and
incorporated herein by this reference.
2. Except as modified by this Modification Agreement, the terms and provisions of
the Original Agreement and the Prior Modification are in all respects ratified and confirmed.
3. Notwithstanding any other provision of this agreement, the Original Agreement
or the Prior Modification, the County, the Deed of Trust Trustee and BB&TGF intend to comply
with North Carolina General Statutes Section 160A-20. No deficiency judgment may be entered
against the County in violation of such Section 160A-20, including, without limitation, any
deficiency judgment for amounts that may be owed under this agreement or the Original
Agreement when the sale of all of the Mortgaged Property, as defined in the Original Agreement,
is insufficient to produce enough money to pay in full all Required Payments, as defined in the
Original Agreement.
4. This document may be executed in counterparts, including separate counterparts,
all of which shall constitute but a single agreement.
[The remainder of this page has been left blank intentionally)
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IN WITNESS WHEREOF, the County has caused this instrument to be executed as of
the day and year first above written by duly authorized officers.
ATTEST: (SEAL) ORANGE COUNTY, NORTH CAROLINA
Beverly A. Blythe
Clerk, Boazd of Commissioners
Mazgazet R. Brown
Chair, Boazd of Commissioners
STATE OF NORTH CAROLINA;
ORANGE COUNTY
I, a Notary Public of such County and State, certify that Mazgazet R. Brown and Beverly
A. Blythe personally came before me this day and acknowledged that they aze the Chair and
Clerk, respectively, of the Boazd of Commissioners of Orange County, North Carolina, and that
by authority duly given and as the act of Orange County, North Carolina, the foregoing
instrument was signed in the County's name by such Chair, sealed with its corporate seal and
attested by such Clerk.
WITNESS my hand and official stamp or seal, this day of ,1998.
[seal]
Notary Public
My commission expires:
This contract has been approved
under the provisions of Article 8,
Chapter 159 of the General
Statutes of North Cazolina.
Robert M. High
Secretary, North Carolina
Local Government Commission
By
[Robert M. High or
Designated Assistant]
Approved:
BB&T GOVERNMENTAL FINANCE
Bv:
F. Louis Loyd, III F. Louis Loyd, III,
Senior Vice President
[Modification Agreement dated as of , 1998.]
Approved:
F. Louis Loyd, III, as
Deed of Trust Trustee
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Revised Exhibit D (Payment Schedule) To Financing Agreement and Deed of Trust dated
as of December 1, 199'7 (the "Original Agreement"), granted by Orange County, North
Carolina, to F. Louis Loyd, III, Deed of Trust Trustee, for the benefit of BB&T Leasing
Corporation, and assigns (as previously modified).
Dated as of : , 1998 Account Numbers: 003-152300-001 & 002
This Payment Schedule is issued pursuant to a Modification Agreement dated as of
1998 (the "Agreement"). The Modification Agreement, among other things,
modifies and amends the Original Agreement and a previous modification agreement that was
dated as of March 1, 1997, and recorded at Book 1564, Page 163, Orange County Registry. All
terms used herein have the meanings ascribed to them in the Original Agreement.
RATES, PAYMENTS AND TERMS
Phase IFinancing -- The payments required to repay the advance made pursuant to the
Original Agreement call for an amortization period of approximately fifteen (15} years.
Payments are semi-annually in arrears in the amount of $xxxxxxxx at an interest rate of 4.92%.
A portion of each payment is paid as and represents payment of interest.
Payments aze due semi-annually beginning on August 1, 1997, and semi-annually on
each February 1 and August 1 thereafter (with the first principal payment due August 1, 1998),
with a final payment of all outstanding principal and accrued and unpaid interest due on
December 20, 2011, all as set forth in Schedule X-1 hereto.
Phase II Financing -- The payments required to repay the advance made pursuant to the
Modification Agreement call for an amortization period of approximately fifteen (15) yeazs.
Payments aze semi-annually in arrears in the amount of $xxxxxxxx at an interest rate of 4.92%.
A portion of each payment is paid as and represents payment of interest.
Payments are due semi-annually beginning on August 1, 1997, and semi-annually on
each February 1 and August 1 thereafter (with the first principal payment due August 1, 1998),
with a final payment of all outstanding principal and accrued and unpaid interest due on February
1, 2012, all as set forth in Schedule X-2 hereto.
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