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HomeMy WebLinkAboutAgenda - 10-03-2017 - 8-h - General Obligation Bond Sale 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: October 3, 2017 Action Agenda Item No. 8-h SUBJECT: General Obligation Bond Sale DEPARTMENT: Finance and Administrative Services ATTACHMENT(S): INFORMATION CONTACT: General Obligation Bond Sale Resolution Gary Donaldson, 919-245-2453 Paul Laughton, 919-245-2152 Bob Jessup, 919-933-9891 PURPOSE: To approve a resolution providing final Board authorization for general obligation bond sale issues: 1) two-thirds school bonds in the amount of $5,900,000; 2) voter-approved school bonds in the amount of $40,000,000; and 3) voter-approved affordable housing bonds in the amount of $2,500,000. This is the first issuance of school and affordable housing general obligation bonds approved by the voters in the November 2016 election. BACKGROUND: At its June 20, 2017 regular meeting, the Board authorized the issuance of up to $5,900,000 of County general obligation school bonds. This was based on the North Carolina General Statutes which allow the County to issue general obligation bonds each year in an amount up to two-thirds of the principal retired in the prior fiscal year, without the need for voter approval. In addition, on November 8, 2016, the voters of Orange County approved the issuance of up to $120,000,000 of the County general obligation school bonds and up to $5,000,000 of general obligation affordable housing bonds. In accordance with the County Capital Investment Plan and in advisement with the County's bond counsel and financial advisor, staff recommends that the County proceed with a General Obligation Bond Sale. The Local Government Commission (LGC) has approved the aforementioned County General Obligation Bond applications and bond sale. The attached resolution for Board approval accomplishes the following: 1) Formally authorizes the sale of the $5,900,000 "two-thirds" school bonds, $40,000,000 in voter-approved school bonds, and $2,500,000 in voter-approved affordable housing bonds; 2) Formally pledges the County's taxing power to provide for payment on the bonds; 3) Approves the proposed form of the bonds; 2 4) Approves the form of the draft official statement for use in offering bonds to investors; 5) States the County's agreement to comply with the relevant provisions of federal tax law and the federal rules for continuing disclosure to the securities markets; and 6) Authorizes County staff to complete the process of issuing the bonds, and approves the steps to that end previously taken. This includes authorizing the Finance Officer to take all appropriate action to close these bonds. The affordable housing bonds will be issued on a taxable basis which means the interest rates on these bonds will be higher than on the school bonds, but staff in conjunction with the LGC and the County's financial adviser will structure the bond payment schedule to minimize the impact. Many local governments routinely issue their affordable housing bonds on a taxable basis because assets financed with those bonds routinely end up in private (non-governmental) ownership or use, in a manner not consistent with federal tax rules for tax-exempt borrowing. The actual interest rates on these bonds will be set when the LGC takes competitive bids on October 24, and the bond closings are scheduled for November 14 and 15. FINANCIAL IMPACT: The General Obligation bonds are included in the County's FY 2017- 2022 Capital Investment Plan and the debt affordability report from the Board's June 13, 2017 work session which indicated a tax equivalent impact ranging from 4.56 cents (upfront) to 5.76 cents (incremental). SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to this agenda item: • GOAL: ENSURE ECONOMIC SELF-SUFFICIENCY The creation and preservation of infrastructure, policies, programs and funding necessary for residents to provide shelter, food, clothing and medical care for themselves and their dependents. RECOMMENDATION(S): The Manager recommends that the Board approve the attached resolution and authorize the Manager and Chair to execute any appropriate documents. 3 RES-2017-063 s*h draft of September 19 Resolution To Sell General Obligation Bonds WHEREAS-- The voters of Orange County have previously approved the issuance of up to $120,000,000 of the County's general obligation school bonds and up to $5,000,000 of general obligation bonds for affordable housing purposes. The County has not yet issued any of these bonds. In addition, on June 20, 2017, the County's Board of Commissioners (the "Board") authorized the issuance of up to an additional $5,900,000 of County general obligation school bonds. These bonds are being issued under the provisions of law that allow the County to issue general obligation bonds to the extent of two- thirds of the amount the County paid down its debt in the prior fiscal year. They do not require voter approval. The Board has now determined that the County should issue $40,000,000 of the voter-approved school bonds, $2,500,000 of the voter-approved housing bonds and all $5,900,000 of the "two-thirds" school bonds. This resolution provides for the issuance of these bonds and takes related action, such as approving the form of the disclosure document that will be used to provide information to prospective bond investors. BE IT THEREFORE RESOLVED by the Board of Commissioners of Orange County, North Carolina, as follows: 1. County Will Sell Bonds -- The County will issue and sell $40,000,000 of the voter-approved school bonds, $2,500,000 of the voter-approved housing bonds and all $5,900,000 of the "two-thirds" school bonds. These bonds collectively will be called the "Bonds" in this resolution. 4 2. Bonds Will Be Issued in Series - The County will issue and sell the bonds in three separate series, as follows: (a) The two-thirds school bonds will be issued in the amount of $5,900,000 and will be designated "General Obligation School Bonds, Series 2017A (and called the "2017A Bonds" in this resolution). (b) There will then be a separate series of the voter-approved school bonds in the aggregate principal amount of $40,000,000 that will be designated "General Obligation School Bonds, Series 2017B (and called the "2017B Bonds" in this resolution). (c) There will finally be a separate series of the voter-approved bonds for affordable housing in the aggregate principal amount of $2,500,000 that will be designated "General Obligation Taxable Housing Bonds, Series 2017C (and called the "2017C Bonds" in this resolution). 3. Payment Provisions -- The Bonds will bear interest at the rates determined at the time of their sale by the Local Government Commission (currently scheduled for October 24). The principal of the Bonds will be payable in annual installments as the Finance Officer may determine after consultation with the LGC, except that the final maturity for the Bonds must not extend beyond December 31, 2027. 4. Pledge of Faith, Credit and Taxing Power -- The County's full faith and credit are hereby irrevocably pledged for the payment of the principal of and interest on the Bonds. Unless other funds are lawfully available and appropriated for timely payment of the Bonds, the County will levy and collect an annual ad valorem tax, without restriction as to rate or amount, on all locally taxable property in the County sufficient to pay the principal of and interest on the Bonds as the same become due. 5. Approval of Official Statement for Offering - There has been made available to each member of the Board a draft of an official statement (the "Official Statement") relating to the Bonds, which is designed to provide appropriate 5 information about the County and the financing to prospective investors in the Bonds. The draft Official Statement remains subject to completion and amendment. The Board approves the LGC's distribution of the Official Statement to prospective purchasers of the Bonds. The Official Statement as distributed must be in substantially the form presented to this meeting, which the Board approves, with changes as the Finance Officer may approve. The Board ratifies the prior actions of the Finance Officer and other County representatives, in collaboration with the LGC staff, in preparing the text of the Official Statement. The Board acknowledges that it is the County's responsibility, and ultimately the Board's responsibility, to ensure that the Official Statement in its final form neither contains an untrue statement of a material fact nor omits to state a material fact required to be included therein for the purpose for which the Official Statement is to be used or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. By the adoption of this resolution, the Board members acknowledge and accept their own responsibility for causing the County to fulfill these responsibilities for the Official Statement. The County deems the Official Statement as distributed by the LGC to be a "final official statement" within the meaning of Rule 15c2-12 of the Securities Exchange Act of 1934, as amended ("Rule 15c2-12"), except for the omission of certain final Bond pricing and other information that Rule 15c2-12 allows to be omitted. 6. Prepayment Provisions - The Board directs the Finance Officer, upon advice from the LGC, to determine the terms and conditions under which the Bonds will be subject to prepayment prior to maturity. The Finance Officer shall execute a certificate prior to the initial delivery of the Bonds designating prepayment terms and conditions. This certificate will be conclusive evidence of the Finance Officer's determination of these terms and conditions. 7. Form of Bonds; Payment Details -- The 2017A Bonds will be in substantially the form set out in Exhibit A. The 2017B Bonds and the 2017C Bonds will be in substantially the same form, with appropriate modifications to reflect 6 their different purpose, maturity schedule, interest rates, prepayment provisions and other series-specific details. The Bonds will be dated the date of their initial issuance, will be in fully registered form, will be in denominations of $5,000 and integral multiples thereof and will be numbered for identification from R-1 upward separately within each series or consecutively across the series, as the Finance Officer may determine. The Bonds must be signed by the manual or facsimile signature of the Board's Chair or the County Manager, and the County's seal must be affixed to the Bonds (or a facsimile of the seal printed on the Bonds) and attested by the manual or facsimile signature of the Clerk to this Board or any Deputy or Assistant Clerk. No Bond will be valid unless at least one of the signatures appearing on the Bond (which may be the signature of the LGC's representative required by law) is manually applied or until the Bond has been authenticated by the manual signature of an authorized officer or employee of a bond registrar selected by the Finance Officer. Interest on each Bond will be payable semiannually (a) from its date, if it is authenticated prior to the first interest payment date, or (b) otherwise from the interest payment date that is, or immediately precedes, the date on which it is authenticated (unless payment of interest is in default, in which case such Bond will bear interest from the date to which interest has been paid). Principal, interest and any prepayment premium will be payable in lawful money of the United States of America. The Board directs the Finance Officer to execute a certificate prior to the initial delivery of the Bonds designating the final aggregate principal amount of the Bonds (up to the maximum authorized amounts stated above), the final principal payment schedule, and the interest payment dates for the Bonds. This certificate will be conclusive evidence of the Finance Officer's approval and determination of these matters. 8. Finance Officer as Registrar; Payments to Registered Owners -- The Board appoints the Finance Officer as Registrar for the Bonds. As Registrar, the Finance Officer shall maintain appropriate books and records of the ownership of the Bonds. The County will treat the registered owner of each Bond as the person 7 exclusively entitled to payment of principal, interest and any prepayment premium and the exercise of all rights and powers of the owner, except that the County will make payments to the person shown as owner on the registration books at the end of the calendar day on the 15th day of the month (whether or not a business day) preceding each interest payment date. 9. Advertising Bonds for Sale - The Board directs the Finance Officer, in collaboration with the LGC, to take all proper steps to advertise the Bonds for sale in accordance with standard LGC procedures, including by using a "Notice of Sale" document in the LGC's customary form and in substantially the same form as used for prior County bond sales. The Board directs the Finance Officer to review and approve a form of Notice of Sale as that officer may determine to be in the County's best interest. 10. LGC To Sell Bonds -- The County asks the LGC to sell the Bonds, to receive and evaluate bids and to award the Bonds based on the best bid received. 11. Completing Official Statement after Sale - After the LGC has received bids and awarded the Bonds to the successful bidder, the Board directs the Finance Officer, in collaboration with the LGC, to prepare a final Official Statement within the meaning of Rule 15c2-12. The Board authorizes the Finance Officer to approve the final document as a final Official Statement. The County, together with the LGC, will arrange for the delivery within seven business days of the sale date of a reasonable number of copies of the final Official Statement to the successful bidder on the Bonds for delivery to each potential investor requesting a copy of the final Official Statement and to each entity to which the bidder and members of the bidding group initially sell the Bonds. 12. County Officers To Complete Closing - The Board authorizes the Finance Officer and all other County officers and employees to take all proper steps to deliver the Bonds to the purchaser upon payment for the Bonds, and to take all other proper steps to complete the issuance of the Bonds. The Board authorizes the Finance Officer to hold the executed Bonds, and any other documents permitted by this resolution, in escrow on the County's behalf until 8 the conditions for the delivery of the Bonds and other documents have been completed to the Finance Officer's satisfaction. The Finance Officer may then release the executed Bonds and other documents for delivery to the appropriate persons or organizations. Without limiting the generality of the foregoing, the Board specifically authorizes the Finance Officer to approve changes to any documents previously signed by County officers or employees, provided that the Bonds must be in substantially the form approved by this resolution and that any changes must not substantially alter the intent of the document from that expressed in the form originally executed. The Finance Officer's authorization of the release of any document for delivery will constitute conclusive evidence of his approval of any changes. In addition, the Board authorizes the Finance Officer to take all appropriate steps for the efficient and convenient carrying out of the County's on-going responsibilities with respect to the Bonds. This authorization includes, without limitation, contracting with third parties for reports and calculations that may be required under the Bonds, this resolution, or otherwise with respect to the Bonds. 13. Undertaking for Continuing Disclosure -- The County undertakes, for the benefit of the beneficial owners of the Bonds, to provide continuing disclosure with respect to the Bonds as described in Exhibit B. The Board designates the Finance Officer as the County officer to be primarily responsible for the County's compliance with its undertakings for continuing disclosure provided for in this resolution. The Finance Officer will provide for the filings and reports (including the reports of material events) constituting the continuing disclosure provided for in this resolution. 14. Resolutions as to Tax Matters -- The County will not take or omit to take any action the taking or omission of which will cause the 2017A Bonds or the 2017B Bonds to be "arbitrage bonds," within the meaning of Section 148 of the "Code" (as defined below), or "private activity bonds" within the meaning of Code Section 141, or otherwise cause interest on those Bonds to be includable in gross 9 income for federal income tax purposes. Without limiting the generality of the foregoing, the County will comply with any Code provision that may require the County at any time to pay to the United States any part of the earnings derived from the investment of the proceeds of the 2017A and the 2017B Bonds, and the County will pay any required rebate from its general funds. For this paragraph, "Code" means the United States Internal Revenue Code of 1986, as amended, including applicable Treasury regulations. 15. Book-Entry System for Bond Registration --The County will issue the Bonds by means of a book-entry system, with one bond certificate for each maturity immobilized at The Depository Trust Company, New York, New York ("DTC"), and not available for distribution to the public. The book-entry system for registration will operate as described in the Official Statement. Therefore, so long as the book- entry system of registration with DTC is in effect, (a) the County will make Bond payments only to DTC or its nominee as registered owner of the Bonds, (b) the County will not be responsible or liable for any transfer of payments to parties other than DTC or for maintaining, supervising or reviewing the records maintained by DTC or any other person related to the Bonds, and (c) the County will not send redemption notices (or any other notices related to the Bonds) to anyone other than DTC or its nominee. The Board, by resolution, may elect to discontinue the County's book-entry system with DTC. The Board authorizes the Finance Officer to enter into any agreements such officer deems appropriate to put into place and carry out the book-entry system with DTC. 16. Finding as to Useful Life and Term of the Bonds - The Board finds and determines that the average weighted maximum useful life of the projects to be financed with the proceeds of the Bonds is at least twenty-five years, subject to ordinary maintenance for projects of this type, and therefore the term of the Bonds will be within such maximum useful life. 17. Miscellaneous Provisions - The Board authorizes all County officers and employees to take all such further action as they may consider desirable in carrying out the purposes of this resolution. The Board ratifies all prior actions of County officers and employees in this regard. Upon the absence, unavailability or refusal to act of the Chair, the County Manager or the Finance Officer, any of such 10 officers may assume any responsibility or carry out any function assigned to another officer in this resolution. In addition, upon the unavailability of the Chair or the Clerk, respectively, any of the rights or responsibilities directed to such officers may be carried out or exercised by the Vice Chair or any Deputy or Assistant Clerk. All other resolutions, or parts thereof, in conflict with this resolution are repealed, to the extent of the conflict. This resolution takes effect immediately. 11 EXHIBIT A - Form of Bonds REGISTERED REGISTERED Number R-X UNITED STATES OF AMERICA STATE OF NORTH CAROLINA ORANGE COUNTY General Obligation School Bond, Series 2017A INTEREST RATE MATURITY DATE DATED DATE CUSIP February 1, October , 2017 684 609 XXX REGISTERED OWNER: *****CEDE & CO.***** PRINCIPAL AMOUNT: **** THOUSAND DOLLARS ($ ,000)*** ORANGE COUNTY, NORTH CAROLINA (the "County"), for value received, promises to pay to the registered owner of this Bond, or registered assigns or legal representative, the principal amount stated above on the maturity date stated above, subject to prior redemption as described below, and to pay interest on this Bond semiannually on each February 1 and August 1, beginning February 1, 2018, at the annual rate stated above. Interest is payable (a) from the dated date stated above, if this Bond is authenticated prior to February 1, 2018, or (b) otherwise from the February 1 or August 1 that is, or immediately precedes, the date on which this Bond is authenticated (unless payment of interest on this Bond is in default, in which case this Bond will bear interest from the date to which interest has been paid). 12 This Bond is one of an issue of the County's $5,900,000 General Obligation School Bonds, Series 2017A (the "Bonds"), of like date and tenor, except as to number, denomination, rate of interest, privilege of redemption and maturity. The Bonds are issued pursuant to a resolution adopted by the County's governing Board of Commissioners on October 3, 2017, and the Constitution and laws of the State of North Carolina, including the Local Government Bond Act. The County's full faith and credit are pledged for the payment of principal of and interest on this Bond. The Bonds are issued by means of a book-entry system, with one bond certificate for each maturity immobilized at The Depository Trust Company, New York, New York ("DTC"), and not available for distribution to the public. Transfer of beneficial ownership interests in the Bonds in the principal amount of$5,000 or any integral multiple thereof will be effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. Principal and interest on the Bonds are payable by the County to DTC or its nominee as registered owner of the Bonds. The County is not responsible or liable for such transfer of ownership or payments or for maintaining, supervising or reviewing the records maintained by DTC, its participants or persons acting through such participants. Bonds maturing prior to February 1, 2028, are not subject to redemption prior to maturity. Bonds maturing on February 1, 2029, and thereafter are redeemable, at the County's option, from any moneys that may be made available for that purpose, in whole or in part on any date not earlier than February 1, 2028, at a redemption price of 100% of the principal amount to be redeemed, plus interest accrued to the redemption date, without premium. If less than all the Bonds stated to mature on different dates are called for redemption, the County will select the Bonds to be redeemed in such manner as the County may determine. If less than all of the Bonds of any one maturity are called for redemption, the particular Bonds or portions of Bonds to be redeemed from that maturity will be selected by lot in such manner as the County in its discretion may 13 determine; provided, however, that the portion of each Bond to be redeemed will be in the principal amount of $5,000 or some integral multiple thereof, and that, in selecting Bonds for redemption, each Bond will be considered as representing that number of Bonds which is obtained by dividing the principal amount of such Bond by $5,000. Notwithstanding the foregoing, so long as a book-entry system with DTC is used for determining beneficial ownership of Bonds, if less than all the Bonds within a maturity are to be redeemed, DTC and its participants will determine which of the Bonds within any such maturity are to be redeemed. If a portion of a Bond is called for redemption, the County will issue a new Bond to the registered owner in a principal amount equal to the unredeemed portion, upon the registered owner's surrender of the Bond. The County will send notice of redemption to DTC or its nominee as the registered owner of the Bonds in such manner as may be provided for under DTC's then-current operating procedures. The County will send this notice not more than 60 days and not less than 30 days prior to the date fixed for redemption. The County is not responsible for sending redemption notices to anyone other than DTC or its nominee. If (a) DTC determines not to continue to act as securities depository for the Bonds or (b) the County so elects, the County will discontinue the book-entry system with DTC. If the County does not identify another qualified securities depository to replace DTC, the County will deliver replacement Bonds in the form of fully-registered certificates. The County Finance Officer has been appointed Registrar for the Bonds. As Registrar, the Finance Officer will maintain appropriate books and records indicating ownership of the Bonds. The County will treat the registered owner of this Bond as the person exclusively entitled to payment of principal, [premium, if any] and interest and the exercise of all other rights and powers of the owner, except that the County will make Bond payments to the person shown as owner on the County's registration books at the end of the calendar day on the 15th day of the month (whether or not a business day) preceding each interest payment date. Principal and interest are payable in lawful money of the United States of America. 14 The County intends that North Carolina law will govern this Bond and all matters of its interpretation. All acts, conditions and things required by the Constitution and laws of the State of North Carolina to happen, exist or be performed precedent to and in the issuance of this Bond have happened, exist and have been performed, and the issue of Bonds of which this Bond is one, together will all other indebtedness of the County, is within every debt and other limit prescribed by the Constitution and laws of the State of North Carolina. IN WITNESS WHEREOF, Orange County, North Carolina, has caused this Bond to be signed by its County Manager, its seal to be affixed hereto and attested by the Clerk to its Board of Commissioners, and this Bond to be dated November 14, 2017. (SEAL) ATTEST: [Sample only - do not sign] [Sample only - do not sign] Clerk, Board of Commissioners County Manager Orange County, North Carolina Orange County, North Carolina The Bonds have been approved by the North Carolina Local Government Commission in accordance with the Local Government Bond Act. [Sample only - do not sign] Greg C. Gaskins Secretary, Local Government Commission [Orange County, North Carolina $5,900,000 General Obligation School Bonds, Series 2017A] 15 ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and transfer(s) unto (Please print or type transferee's name and address, including zip code) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OR TRANSFEREE: the within bond and all rights thereunder, hereby irrevocably constituting and appointing , Attorney, to transfer said bond on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: Signature(s) must be (Signature of Registered Owner) guaranteed by a participant in the NOTICE: The signature above Securities Transfer Agent Medallion must correspond with the name of the Program ("STAMP") or similar program registered owner as it appears on the front of this bond in every particular without alteration or enlargement or any change whatsoever. [Orange County, North Carolina $5,900,000 General Obligation School Bonds, Series 2017A] 16 Exhibit B -- Undertaking for Continuing Disclosure The County undertakes, for the benefit of the beneficial owners of the Bonds, to provide the following items and information to the Municipal Securities Rulemaking Board (the "MSRB"): (a) by not later than seven months from the end of each of the County's fiscal years, audited County financial statements for such fiscal year, if available, prepared in accordance with Section 159-34 of the General Statutes of North Carolina, as it may be amended from time to time, or any successor statute, or, if such audited financial statements are not available by seven months from the end of any fiscal year, unaudited County financial statements for such fiscal year, to be replaced subsequently by audited County financial statements to be delivered within 15 days after such audited financial statements become available for distribution; (b) by not later than seven months from the end of each of the County's fiscal years, (i) the financial and statistical data as of a date not earlier than the end of the preceding fiscal year (which data will be prepared at least annually, will specify the date as to which such information was prepared and will be delivered with any subsequent material events notices specified in subparagraph (c) below) for the type of information included under heading The County - Debt Information" and "- Tax Information" in the final Official Statement (excluding any information on overlapping or underlying units), and (ii) the combined budget of the County for the current fiscal year, to the extent such items are not included in the audited financial statements referred to in (a) above; (c) in a timely manner, not in excess of ten business days after the occurrence of the event notice of any of the following events with respect to the Bonds: (1) principal and interest payment delinquencies; (2) non-payment related defaults; 17 (3) unscheduled draws on debt service reserves reflecting financial difficulties; (4) unscheduled draws on any credit enhancements reflecting financial difficulties; (5) substitution of credit or liquidity providers, or their failure to perform; (6) adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the Bonds, or other material events affecting the tax status of the Bonds; (7) modifications to rights of the beneficial owners of the Bonds, if material; (8) calls for redemption of the Bonds (other than calls pursuant to sinking fund redemption), if material, and tender offers; (9) defeasances; (10) release, substitution or sale of any property securing repayment of the Bonds; (11) rating changes; (12) bankruptcy, insolvency, receivership or similar proceedings related to the County or any other person or entity that may at any time become legally obligated to make payments on the Bonds (collectively, the "Obligated Persons"); (13) the consummation of a merger, consolidation, or acquisition involving an Obligated Person or the sale of all or substantially all of the assets of the Obligated Person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive 18 agreement relating to any such actions, other than pursuant to its terms, if material; and (14) Appointment of a successor or additional trustee or the change of name of a trustee, if material; and (d) in a timely manner, notice of a failure of the County to provide required annual financial information described in (a) or (b) above on or before the date specified. For the purposes of the event identified in subparagraph (12) above, the event is considered to occur when any of the following occurs: the appointment of a receiver, fiscal agent or similar officer for an Obligated Person in a proceeding under the U.S. Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the Obligated Person, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the Obligated Person. If the County fails to comply with the undertaking described above, any beneficial owner of the Bonds may take action to protect and enforce the rights of all beneficial owners with respect to such undertaking, including an action for specific performance; provided, however, that failure to comply with such undertaking will not be an event of default and will not result in any acceleration of payment of the Bonds. All actions will be instituted, had and maintained in the manner provided in this paragraph for the benefit of all beneficial owners of the Bonds. The County shall provide the documents and other information referred to above to the MSRB in an electronic format as prescribed by the MSRB and accompanied by identifying information as prescribed by the MSRB. 19 The County may discharge its undertaking as set forth in this resolution by providing such information in any manner that the United States Securities and Exchange Commission subsequently authorizes in lieu of the manner described above. The County reserves the right to modify from time to time the information to be provided to the extent necessary or appropriate in the County's judgment, provided that: (a) any such modification may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of the County; (b) the information to be provided, as modified, would have complied with the requirements of Rule 15c2-12 as of the date of the final Official Statement, after taking into account any amendments or interpretations of Rule 15c2-12, as well as any changes in circumstances; and (c) any such modification does not materially impair the interests of the beneficial owners, as determined either by parties unaffiliated with the County or by the approving vote of the registered owners of a majority in principal amount of the Bonds pursuant to the terms of the bond resolution, as it may be amended from time to time, at the time of the amendment. Any annual financial information containing modified operating data or financial information will explain, in narrative form, the reasons for the modification and the effect of the change in the type of operating data or financial information being provided.