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HomeMy WebLinkAboutAgenda - 04-21-20; 8-e - Adoption of the Final Financing Resolution Authorizing the Issuance of $40,750,000 in Installment Purchase Financing for Various Capital Investment Plan Projects 1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: April 21, 2020 Action Agenda Item No. 8-e SUBJECT: Adoption of the Final Financing Resolution Authorizing the Issuance of $40,750,000 in Installment Purchase Financing for Various Capital Investment Plan Projects DEPARTMENT: Finance and Administrative Services ATTACHMENT(S): INFORMATION CONTACT: Attachment 1 . Resolution Approving Gary Donaldson, (919) 245-2453 Financing Terms and Paul Laughton, (919) 245-2152 Documents for 2020 Robert Jessup, (919) 933-9891 Installment Financing Attachment 2. Deed of Trust Attachment 3. Trust Agreement Attachment 4. School Project Category Descriptions Attachment 5. Proposal from Capital One Attachment 6. PowerPoint PURPOSE: To adopt the final financing resolution authorizing the borrowing of approximately $40,750,000 in installment financing to finance capital investment projects and equipment for the fiscal year, including amounts to pay transaction costs. BACKGROUND: At the March 10, 2020 Board Business meeting, the Board of County Commissioners conducted a public hearing and was provided preliminary information of capital projects and equipment financing. The Board made a preliminary determination to finance costs of these projects and equipment, and financing costs by the use of an installment financing, as authorized under Section 160A-20 of the North Carolina General Statutes. The statutes require that the County adopt a financing resolution supporting the application to the Local Government Commission (LGC) for approval of the financing. County staff has been in contact with the LGC staff, and expects no issues in receiving full LGC approval. With action on this resolution, the Board (a) approves the substantially final financing documents, (b) approves the sale of a limited obligation bond to Capital One Public Funding, LLC pursuant the attached proposal, and (c) authorizes staff to complete the financing. The financing team, which includes the County's financial advisor and bond counsel, has determined that the shift from a public sale to a privately bank financed transaction is prudent due to pandemic induced inefficiencies in the public finance market which have resulted in postponed or cancelled bond transactions. To eliminate the risk of not being able to obtain proceeds next month to fund the Construction Manager at Risk (CMAR) Northern Campus project and the other 2 County and School projects, the financing team has determined that a private bank financed transaction with Capital One is now the best option. Capital One will hold an interest rate of 2.7% through May 12, 2020, with three bids having been received. It is important to note that this interest rate is well within the County's Debt and Affordability Model. The County's ability to close in May and fund the CMAR and other Capital Investment Plan (CIP) projects without uncertainties regarding capital market access was a strong financing consideration for shifting to this privately placed bank financing. If the Board adopts the resolution, staff expects to close and receive proceeds by mid-May. The financing strategy at this time does include moving forward with the competitive sale of the General Obligation (GO) bonds for Orange County Schools. The County's AAA rating was affirmed by all three rating agencies the week of March 30, 2020. The rationale for the varying financing approaches between this transaction and the GO bonds is that the capital market acceptance of the GO bond is based on the government's full faith and credit/taxing power which is well established with investors, and the GO bond sale will now not compete with the Northern Campus CMAR bank financing. FINANCIAL IMPACT: A preliminary estimate of maximum debt service applicable to the capital investment projects and equipment financing would require the highest debt service payment of $3.6 million in FY 2021-22. The tax rate equivalent for the estimated highest debt service payment is approximately 1.91 cents. SOCIAL JUSTICE IMPACT: The following Orange County Social Justice Goal is applicable to this item: • GOAL: FOSTER A COMMUNITY CULTURE THAT REJECTS OPPRESSION AND INEQUITY The fair treatment and meaningful involvement of all people regardless of race or color; religious or philosophical beliefs; sex, gender or sexual orientation; national origin or ethnic background; age; military service; disability; and familial, residential or economic status. • GOAL: CREATE A SAFE COMMUNITY The reduction of risks from vehicle/traffic accidents, childhood and senior injuries, gang activity, substance abuse and domestic violence. • GOAL: ENABLE FULL CIVIC PARTICIPATION Ensure that Orange County residents are able to engage government through voting and volunteering by eliminating disparities in participation and barriers to participation. ENVIRONMENTAL IMPACT: The following Orange County Environmental Responsibility Goal impacts are applicable to this item: • ENERGY EFFICIENCY AND WASTE REDUCTION Initiate policies and programs that: 1) conserve energy; 2) reduce resource consumption; 3) increase the use of recycled and renewable resources; and 4) minimize waste stream impacts on the environment. • RESULTANT IMPACT ON NATURAL RESOURCES AND AIR QUALITY Assess and where possible mitigate adverse impacts created to the natural resources of the site and adjoining area. Minimize production of greenhouse gases. RECOMMENDATION(S): The Manager recommends that the Board approve the final financing resolution authorizing the steps to proceed with the financing of the stated capital projects and equipment. 3 RES-2020-026 Attachment 1 s*h draft of Mri18 Resolution providing final approval of terms and documents for Spring 2020 installment financing WHEREAS- The Board of Commissioners has previously determined to carry out various public improvements and acquisitions, as identified in the County's capital improvement plan and as described on Exhibit A. The Board has determined to carry out the financings by using an installment financing, as authorized under Section 160A-20 of the North Carolina General Statutes. Capital One Public Funding, LLC (the "Lender"), has submitted a proposal to provide the financing. County staff has made available to the Board the draft documents listed on Exhibit B (the "Documents"), which relate to the County's carrying out the financing plan. This resolution provides the County Board's final approval of the financing terms and the substantially final financing documents. BE IT THEREFORE RESOLVED by the Board of Commissioners of Orange County, North Carolina, as follows: 1. Determination to Proceed with Financing -- The Board confirms its decision to carry out the proposed installment financing as described above, to provide financing for new public assets and improvements. The County will carry out the projects with financing from the Lender substantially in accordance with a financing proposal from the Lender dated April 1, 2020. Under the financing plan, the County will receive funds from the Lender to carry out the projects. The County will repay the funds over time, with interest. The County will secure its repayment obligation by granting a mortgage-like interest in some or all of the following facilities: (a) the County's Government Services Annex at 208 S. Cameron St. in Hillsborough, along with the County's Link Center and the 4 District Attorney's office building; (b) the County's Emergency Operations Center on Meadowlands Drive in Hillsborough; (c) the proposed site of the new Northern County Campus; and (d) the County's Southern Campus in Chapel Hill. 2. Approval of Documents;Direction to Execute Documents--The Board approves the forms of the Documents submitted to this meeting. The Board authorizes the Chair and the County Manager,or either of them,to execute and deliver the Documents when in final form. The Documents in their respective final forms must be in substantially the forms presented,with changes as the Chair or the County Manager may approve. The execution and delivery of any Document by an authorized County officer will be conclusive evidence of that officer's approval of any changes. The Agreements in final form, however, must be consistent with the financing plan described in this resolution and must provide (a) for the amount financed by the Town not to exceed $43,000,000, (b) for an annual interest rate not to exceed 2.70% (in the absence of default, or a change in tax status), and (c) for a financing term not to extend beyond December 31, 2040. The amount financed under the Documents may include amounts to pay financing expenses and other necessary and incidental costs. 4. Officers to Complete Closing - The Board authorizes the County Manager, the Finance Officer and all other County officers and employees to take all proper steps to complete the financing in accordance with the terms of this resolution. The Board authorizes the County Manager to hold executed copies of all financing documents authorized by this resolution in escrow on the County's behalf until the conditions for their delivery have been completed to her satisfaction, and then to release the executed documents for delivery to the appropriate persons or organizations. Without limiting the generality of the previous paragraphs, the Board specifically authorizes the County Manager (a) to approve and enter into, on behalf of the County, any additional agreements appropriate to carry out the financing plan contemplated by this resolution, and (b) to approve changes to any documents previously signed by County officers or employees, provided that the changes do not substantially alter the intent from that expressed in the form originally signed. The 5 County Manager's authorization of the release of any document for delivery will constitute conclusive evidence of her approval of any changes. In addition, the County Manager and the Finance Officer are authorized to take all appropriate steps for the efficient and convenient carrying out of the County's on- going responsibilities with respect to the financing. This authorization includes, without limitation, contracting with third parties for reports and calculations that may be required under the Documents, this resolution or otherwise with respect to the bonds. 6. Miscellaneous Provisions - The Board authorizes all County officers and employees to take all further action as they may consider desirable to carry out the purposes of this resolution. In particular,the Board directs the Clerk to this Board to apply the County's seal to the final form Documents, and to attest to the application of the seal. The Board ratifies all prior actions of County officers and employees to this end. Upon the unavailability or refusal to act of the County Manager, the Chair or the Finance Officer,any other of those officers may assume any responsibility or carry out any function assigned in this resolution. In addition, the Vice Chair or any Deputy or Assistant Clerk may carry out or exercise any rights or responsibilities assigned in this resolution to the Chair or the Clerk. The Board repeals all other Board proceedings, or parts of proceedings, in conflict with this resolution, to the extent of the conflict. This resolution takes effect immediately. 6 Exhibit A - list of projects to be financed with estimated amounts Component Estimated Cost Facility, Accessibility, Safety and Security Projects $ 212,634 Generator Projects $ 33,000 HVAC Projects $ 230,218 Major Plumbing Repairs $ 50,885 Northern Campus— Detention Center $ 21,989,681 Northern Campus— EAC $ 5,677,065 Northern Campus— Parks Operations $ 1,404,810 Government Services (Link) Remediation $ 581,503 Skill Development Relocation - Europa Center Upfits $ 254,953 Roofing and Fagade Projects $ 686,167 Parks and Recreation Facility Renovations. Repairs, Safety Improvements $ 246,500 Conservation Easements $ 259,514 River Park, Phase II $ 118,509 ITGC Initiatives $ 197,826 IT Infrastructure $ 489,910 Communication Systems $ 273,221 Solid Waste - Equipment and Vehicles $ 717,228 Solid Waste - Administrative Building Remediation $ 281,324 Sportsplex Capital Items - 2 Vans $ 70,090 Schools - Recurring Capital Needs $ 3,000,000 Schools - Improvements to Older Facilities $ 472,941 Schools—Other Various Projects $ 3,242,252 Total Project Costs $ 40,490,231 The County will also use additional loan proceeds to pay financing costs. 7 Exhibit B -- Draft Documents (a) A draft dated April 8, 2020, of a Third Supplemental Trust Agreement to be dated on or about May 1, 2020, between the County and The Bank of New York Mellon Trust Company, N.A. (the "Trustee"), providing for the advance of funds to the County, for the issuance of a limited obligation bond to the Lender, for the County's obligation to repay the amounts advanced, and for the County's responsibilities for the use and care of the collateral (b) A draft dated April 8, 2020, of a Deed of Trust Supplement#3 to be dated on or about May 1, 2020, from the County to a deed of trust trustee for the Trustee's benefit, providing for a security interest in property to secure the County's obligations under the limited obligation bonds and the other financing documents. 8 Attachment 2 s*h draft of April 9 Prepared by and return after recording to: Robert M. Jessup Jr. Sanford Holshouser LLP 209 Lloyd St., Suite 3S0 Carrboro, NC 27S10 DEED OF TRUST SUPPLEMENT #3 PINS 9874-15-3612 9864-39-4358 9874-80-2738 9880-00-8527 Brief description: Link Center Building at 200 S. Cameron St., Government Services Annex at 208 S. Cameron St. and District Attorney's office building at 144 E. Margaret Lane, all in Hillsborough Future North Campus Site off Highway 70 Emergency Operations Center on Meadowlands Drive in Hillsborough Southern Campus Site off Homestead Rd. in Chapel Hill Supplements RB 6486, Page 413; RB 6613, Page 17; and RB 6633, Page 1121; also see RB , Page (partial release) STATE OF NORTH CAROLINA ) The collateral is or includes fixtures. ORANGE COUNTY ) This instrument secures future advances. 9 DEED OF TRUST SUPPLEMENT #3 THIS DEED OF TRUST SUPPLEMENT#3 (this "Supplement") is dated as of May 1, 2020, and is granted by ORANGE COUNTY, NORTH CAROLINA, a political subdivision of the State of North Carolina(the"County"),to Amy K.Johnson,as trustee (the "Deed of Trust Trustee"), for the benefit of THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,AS TRUSTEE ("BNY-M"). RECITALS: The County is issuing its [$43,000,000] Limited Obligation Bonds, Series 2020 (the "2020 Bonds"), under a Third Supplemental Trust Agreement dated as of May 1, 2020 (the "2020 Agreement"), between the County and BNY-M, as trustee. The County is issuing the 2020 Bonds to provide funds, to be used together with other available funds, to acquire, construct, equip and otherwise improve a variety of County facilities and assets, as well as to pay financing costs and other related costs. The 2020 Agreement supplements a Trust Agreement dated as of June 1, 2018 (the "2018 Agreement"), between the County and BNY-M, as trustee, which the parties previously supplemented by a First Supplemental Trust Agreement dated as of April 1, 2019, and a Second Supplemental Trust Agreement dated as of October 1, 2019 (as supplemented, the "Prior Agreement"). Under the Prior Agreement, the County issued its $7,510,000 Limited Obligation Bonds, Series 2018, its $14,135,000 Limited Obligation Bonds, Series 2019A, and its $29,745,000 Limited Obligation Bonds, Series 2019B (together,the "Prior Bonds").The County secured its repayment obligation with respect to the Prior Bonds by granting a security interest in certain Mortgaged Property, as defined in the 2019B Deed of Trust (as defined below). The parties have now agreed that the Mortgaged Property will also secure the County's repayment obligations with respect to the 2020 Bonds as provided in the 2020 Agreement. Accordingly, this Supplement supplements the Deed of Trust and Security Agreement granted by the County for the benefit of BNY-M dated as of June 1, 2018 (the "2018 Deed of Trust") and recorded at RB 6486, Page 413, Orange County Registry, which has been previously supplemented by instruments recorded at RB 2 10 6613, Page 17, and RB 6633, Page 1121 (this is the "2019B Deed of Trust"), Orange County Registry (those instruments, together with the 2018 Deed of Trust, are referred to as the "Existing Deed of Trust" in this Supplement). The Existing Deed of Trust, as modified by this Supplement, is referred to as the "Modified Deed of Trust" in this Supplement. The Mortgaged Property includes the real property described in Exhibit A. The County is the record owner of that real property. The County executes and delivers this Supplement to secure current advances under the 2020 Agreement of[$43,000,000],as well as (a) total outstanding advances with respect to the Prior Bonds of approximately$50,595,000 and (b) potential future advances up to a total maximum principal amount of $200,000,000, all as described and pursuant to the Existing Deed of Trust.The time during which such future advances may be made is 30 years from June 1, 2018. The current scheduled date for final repayment of amounts secured under this Supplement and the Existing Deed of Trust is October 1, 2040. NOW, THEREFORE, (1) in consideration of the execution and delivery of the 2020 Bonds and the 2020 Agreement and other good and valuable consideration, the receipt and sufficiency of which the County acknowledges, (2) to secure the County's performance of all its covenants under this Supplement, the Existing Deed of Trust, the 2020 Agreement, the Prior Agreement, the 2020 Bonds and the Prior Bonds (together, the "Loan Documents"), and (3) to charge the Mortgaged Property with that payment and performance, the County sells, grants and conveys to the Deed of Trust Trustee, her successors and assigns forever, in trust,with power of sale,the Mortgaged Property, as defined in the 2019B Deed of Trust, which includes the property described in Exhibit A; BUT TAKE NOTE THAT Parcel 4 as defined in the 2019B Deed of Trust has previously been released from the lien of the Existing Deed of Trust; 3 11 TO HAVE AND TO HOLD the Mortgaged Property with all privileges and appurtenances belonging thereunto, to the Deed of Trust Trustee, her successors and assigns forever, upon the trusts, terms and conditions and for the purposes set out below, in fee simple in trust; SUBJECT, HOWEVER, to the encumbrances described in Exhibit B; BUT THIS CONVEYANCE IS MADE UPON THIS SPECIAL TRUST: if the County pays its "Obligations," as defined in Section 1-1 below, in full and in accordance with the Loan Documents, and the County complies with all the terms, covenants and conditions of the Loan Documents, this conveyance will be null and void and will be canceled of record at the County's request and cost, and title will revest as provided by law; BUT IF, HOWEVER, THERE OCCURS AN EVENT OF DEFAULT UNDER THE LOAN DOCUMENTS,then BNY-M will have the remedies provided for in this Modified Deed of Trust, including directing the Deed of Trust Trustee to sell the Mortgaged Property under power of sale. The County covenants with the Deed of Trust Trustee and BNY-M that the County is seized of and has the right to convey the Mortgaged Property in fee simple, that the Mortgaged Property is free and clear of all liens and encumbrances other than Permitted Encumbrances, as defined in the Prior Agreement and the 2020 Agreement, that title to the Mortgaged Property is marketable, and that the County will forever warrant and defend title to the Mortgaged Property (subject to the Permitted Encumbrances) against the claims of all persons. THE COUNTY COVENANTS AND AGREES with the Deed of Trust Trustee and BNY-M (and their respective heirs, successors and assigns), in consideration of the foregoing, as follows: 1. Security Provided 1-1 Security for Payment and Performance. The Modified Deed of Trust secures the County's payment, as and when the same become due and payable, of all amounts payable by the County under the Loan Documents (the "Obligations") and the County's timely compliance with all terms, covenants and conditions of (a) 4 12 the Loan Documents and (b) any Additional Bonds, as defined in and as may be executed and delivered pursuant to the Prior Agreement. 1-2 Present and Future Advances. This Deed of Trust is executed to secure all the County's present and future obligations to the Trustee related to the Mortgaged Property as described in and pursuant to the Modified Deed of Trust.The total amount, including present and future obligations, that may be secured by this Modified Deed of Trust at any one time is $200,000,000.The period within which future obligations may be incurred is 30 years from June 1, 2018. 1-3 Existing Deed of Trust Otherwise Confirmed. Except as provided by this Supplement, the County ratifies, approves and confirms the terms of the Existing Deed of Trust. 1-4 County's Obligation Limited. Notwithstanding any other provision of the Loan Documents, the parties intend that this transaction will comply with North Carolina General Statutes Section 160A-20. No deficiency judgment may be entered against the County in violation of Section 160A-20. No provision of this Supplement should be construed or interpreted as creating a pledge of the County's faith and credit within the meaning of any constitutional debt limitation. No provision of this Supplement should be construed or interpreted as an illegal delegation of governmental powers, nor as an improper donation or lending of the County's credit within the meaning of the North Carolina constitution. The County's taxing power is not and may not be pledged, directly or indirectly contingently, to secure any moneys due under this Supplement. Nothing in this Section is intended to impair or prohibit foreclosure under the Modified Deed of Trust if the Obligations are not paid when due or otherwise upon the occurrence of an Event of Default under the Loan Documents. No provision of this Supplement restricts the County's future issuance of any of its bonds or other obligations payable from any class or source of the County's moneys (except to the extent the Loan Documents restrict the incurrence of additional obligations secured by the Mortgaged Property). To the extent of any conflict between this Section and any other provision of this Supplement, this Section takes priority. 5 13 2. Miscellaneous 2-1 Notices. (a) Any communication provided for in this Supplement must be in writing (not to include facsimile transmission or electronic mail). (b) Any communication under this Supplement will be deemed given on the delivery date shown on a United States Postal Service certified mail receipt, or a delivery receipt (or similar evidence) from a national commercial package delivery service, if addressed as follows: (i) if to the County, to Orange County Manager, Re: Notice under 2020 LOBS Deed of Trust, Post Office Box 8181, Hillsborough, NC 27278 (ii) if to the Deed of Trust Trustee, to Deed of Trust Trustee, c/o The Bank of New York Mellon Trust Company, N.A., Re: Notice for 2020 Financing for Orange County, 10161 Centurion Parkway North, Jacksonville, FL 32256 (iii) if to BNY-M, to The Bank of New York Mellon Trust Company, N.A., Re: Notice for 2020 Financing for Orange County, 10161 Centurion Parkway North, Jacksonville, FL 322S6 (c) A copy of any notice must also be sent to the Lender, Capital One Public Funding, LLC, at (d) Any addressee may designate additional or different addresses for communications by notice given under this Section to each of the others. The County must send copies of any notices it sends to the Deed of Trust Trustee also to BNY-M. 2-2 Definitions. All capitalized terms used in this Supplement and not otherwise defined have the meanings ascribed to them otherwise in the Loan Documents. 2-3 Governing Law; Forum. The County, BNY-M, the Lender and the Deed of Trust Trustee intend that North Carolina law will govern this Supplement and all matters of its interpretation. To the extent permitted by law, the County, BNY-M, the 6 14 Lender and the Deed of Trust Trustee agree that any action brought with respect to this Supplement must be brought in the North Carolina General Court of Justice in Orange County, North Carolina. 2-4 Limitation of Liability of Officers and Agents. No officer, agent or employee of the County, BNY-M or the Deed of Trust Trustee will be subject to any personal liability or accountability by reason of the execution of this Supplement or any other documents related to the transactions contemplated by this Supplement. Those officers or agents are deemed to execute documents in their official capacities only, and not in their individual capacities. This Section does not relieve any officer, agent or employee from the performance of any official duty provided by law. 2-5 Covenants Run with the Land. All covenants contained in the Modified Deed of Trust run with the real estate encumbered by the Modified Deed of Trust 2-6 Further Instruments. Upon the request of BNY-M or the Deed of Trust Trustee, the County will execute, acknowledge and deliver any further instruments reasonably necessary or desired by BNY-M or the Deed of Trust Trustee to carry out more effectively the purposes of this Supplement or any other document related to the transactions contemplated by this Supplement, and to subject to the liens and security interests of this Supplement all or any part of the Mortgaged Property intended to be given or conveyed, whether now given or conveyed or acquired and conveyed subsequent to the date of this Supplement. 2-7 Entire Agreement; Amendments. This Supplement, together with the other Loan Documents, constitutes the County's entire agreement with the Trustee and the Deed of Trust Trustee with respect to its general subject matter. This Supplement may not be changed except in accordance with the other Loan Documents. The consent of the Deed of Trust Trustee is not required for any changes. [The remainder of this page has been left blank intentionally.] 15 IN WITNESS WHEREOF, the County has caused this instrument to be signed, sealed and delivered by duly authorized officers, as of the day and year first above written. (SEAL) ATTEST: ORANGE COUNTY, NORTH CAROLINA By: Donna S. Baker Bonnie B. Hammersley Clerk, Board of Commissioners County Manager STATE OF NORTH CAROLINA; ORANGE COUNTY I, a Notary Public of such County and State, certify that Bonnie B. Hammersley and Donna S. Baker personally came before me this day and acknowledged that they are the County Manager and the Clerk of the Board of Commissioners, respectively, of Orange County, North Carolina, and that by authority duly given and as the act of such County, the foregoing instrument was signed in the County's name by such County Manager, sealed with its corporate seal and attested by such Clerk. WITNESS my hand and official stamp or seal, this day of May, 2020. [SEAL] Notary Public My commission expires: [Deed of Trust Supplement#3 dated as of May 1, 2020 for the benefit of The Bank of New York Mellon Trust Company, N.A., as Trustee] g 16 EXHIBIT A - Pledged Sites Description TRACT 1 [Government Service Annex, Link Center and District Attorneys' Office]: BEING that certain property containing 9.202 acres, more or less, adjacent to South Cameron Street as shown on a plat entitled "Recombination Survey Properties of Orange County" as prepared by Riley Surveying, P.A. dated June 5, 2007 and recorded June 7, 2007 in Plat Book 102, Page 36, Orange County Register of Deeds. PIN Number: 9874-15-3612 TRACT 2 [North Campus SiteL BEING all of that 19.334-acre parcel, more or less, shown on survey entitled "Recombination Survey, Property of Orange County" dated as of September 6, 2019 and recorded in Plat Book 120, Page 159, Orange County Registry. PIN Number: 9864-39-4358 TRACT 3 [E-911 Center in the Meadowlands -- Approximately 22,000-square foot building located on Meadowlands Drive, Hillsborough) BEGINNING at a point located in the eastern margin of the 60 foot wide right- of-way of Meadowlands Drive, said beginning point being further located South 12' 12' 30" West 360.84 feet from a nail located at the intersection of the center line of Meadowlands Drive with the center line of the 60 foot wide right-of-way of N.C. Highway 70; and running thence from said beginning point South 73' 36' 46" East 407.39 feet to a point; thence South 04' 48' 02" West 329.70 feet to a point; thence North 67' 16' 01" West 494.62 feet to a point located in the aforesaid easterly margin of the right-of-way of Meadowlands Drive; thence with said easterly margin of the right-of-way of Meadowlands Drive in two calls as follow: (1) with the arc of a circular curve to the left having a radius of 525.05 feet (and a chord course and distance of North 23' 54' 22" East 134.12 feet), an arc distance of 134.49 feet to a point; thence (2) North 16' 34' 02" East 135.34 feet to the point or place of BEGINNING; containing 3.00 acres and being Lot A as shown on a survey entitled "Subdivision of Property Surveyed for Meadowlands Associates" by Alois Callemyn Land Surveyors dated February 26, 1996 and recorded in Plat Book 75, Page 146, in the Orange County Registry. 9 17 PIN Number: 9874-80-2738 TRACT 4 - Intentionally omitted TRACT 5 [Southern Campus Site] BEGINNING in the center of the public road leading from Calvander to Orange Church witnessed by an iron stake on the South side of said road; running thence South 2 degrees 30 minutes east 1,304 feet to an iron stake and pointers in the line of the University of North Carolina property; thence with said property East 1,194 feet to an iron stake in Will Freeland's land; thence with his line North 1,190 feet to the center of said road; thence with the center of said road North 84 degrees West 1,250 feet to the beginning, containing 34.10 acres, more or less, as surveyed by J. Ralph Weaver, County Surveyor, on November 20, 1940, and being part of the land formerly owned by Mrs. J. Walker Womble. BEING also described as the Lands of the County of Orange and the Project Homestead Lease Lot as shown on that plat entitled "Easement Plat for Orange County Senior Center"and recorded in Plat Book 102, Page 99, Orange County Registry. PIN Number: 9880-00-8527 10 18 EXHIBIT B -- Existing Encumbrances As to all Tracts: the Deed of Trust and Security Agreement granted by the County for the benefit of BNY-M dated as of June 1, 2018, and recorded at RB 6486, Page 413, Orange County Registry, as previously supplemented (referred to as the "Existing Deed of Trust" in this instrument, and further defined above). All references to books and pages in the lists below are to the Orange County Registry. As to Tract 1: 1. Subject to Matters shown on plats recorded in Plat Book 102, Page 34; Plat Book 102, Page 36; Plat Book 59, Page 179; and Plat Book 110, Page 91. 2. Conservation Easement to Orange County recorded in Book 4296, page 308. 3. Title to that portion of the Land lying below the mean high water mark of Eno River. 4. Riparian rights incident to the Land. 5. Easement to the Town of Hillsborough recorded in Book 1030, Page 546. 6. Easement(s) to Duke Power Company recorded in Book 1146, Page 153. 7. Right of Way Agreement between Orange County and Duke Energy Carolinas, LLC recorded in Book 5905, Page 73. As to Tract 2: 1. Subject to matters shown on plat recorded in Plat Book 118, Page 105. 2. Subject to matters shown on plat recorded in Plat Book 94, Page 68 including a 30-foot joint driveway easement and septic easement located on the Land. 3. Rights of others for ingress and egress purposes in and to the use of easements located on the Land. 4. Commissioners' Second Revised Final Report recorded in Book 3446, Page 26 and Order of Confirmation recorded in Book 3446, Page 29. 5. Title to that portion of the Land within the right-of-way of US Hwy 70 and West Hill Ave. 6. Easement(s) to Duke Power Company recorded in Book 114, Page 95. 7. Easement(s) and/or Right(s) of Way to Jean A. Hall, heirs and assigns recorded in Book 3446 at Page 39, Orange County Registry. 8. Non-exclusive perpetual right and easement of ingress and egress for a driveway for Dorothy Hall Holloway and Husband, Bill Holloway and their successors and assigns, recorded in Book 3831 at Page 375, Orange County Registry. 9. Declaration of Restrictions and Provisions for Private Road Maintenance recorded in Book 376 at Page 552. 10.Easement recorded in Book 376 at Page 555, Orange County Registry. 11 19 11.Easement(s) and/or Right(s) of Way to Hillsboro Power and Light Co. recorded in Book 87 at Page 437, Orange County Registry. 12.Easement(s) and/or Right(s) of Way to State Highway Commission recorded in Book 183 at Page 512, Orange County Registry. 13.Terms and conditions and rights of others in and to that Buffer Easement recorded in Book 6625 at Page 2007, Orange County Registry. 14.Buffer Easement recorded in Book 6625 at Page 2012, Orange County Registry. As to Tract 3: 1. Restrictions appearing of record in Book 654, Page 517 and amended in Book 1081 at Page 425. 2. Subject to matters shown on plat recorded in Plat Book 75, Page 146. 3. Easement(s) to Town of Hillsborough recorded in Book 804, Page 444. 4. Easement(s) to Duke Power Company recorded I Book 676, Page 500. 5. Easement(s) to Public Service Company of North Carolina recorded in Book 1083, Page 235. 6. Title to that portion of the Land within the right-of-way of Meadowland Drive. 7. Termination Agreement recorded in Book 4126, Page 346. 8. Town of Hillsborough Conditional Use Permit#2007-04 recorded in Book 4416, Page 496. 9. Sand Filter SCM (Stormwater Control Measure) Operation and Maintenance Agreement recorded in Book 6468 at Page 214, Orange County Registry. 10.Stormwater Control Measure Access and Maintenance Easement to the Town of Hillsborough recorded in Book 6616 at Page 1294, Orange County Registry. Tract 4 - Intentionally omitted As to Tract 5: 1. Special Needs Housing Program Deed of Trust, Assignment of Rents and Leases, and Security Agreement from Inter-Faith Council for Social Service, Inc. to A. Robert Kucab, Trustee for North Carolina Housing Finance Agency to secure a note in the amount of$150,000.00 and recorded in Book 1636, page 285, Orange County Registry.As modified by Modification to Promissory Note, Deed of Trust and Declaration of Deed Restrictions recorded in Book 5911, page 372, Orange County Registry. 2. Orange County Home Program Deed of Trust and Security Agreement from Interfaith Council for Social Services, Inc.to Geoffrey E. Gledhill,Trustee for the benefit of Orange County to secure a note in the amount of $50,000.00 and recorded in Book 1731, Page 1, Orange County Registry. As affected by that Request for Notice recorded in Book 2358, Page 156, Orange County Registry. 12 20 3. Lease from Orange County, North Carolina as Lessor and Inter-Faith Council for Social Service, Inc. recorded in Book 1579, Page 152, Orange County Registry. 4. Agreement between Interfaith Council for Social Service, Inc., Orange County, and Orange Water and Sewer Authority recorded in Book 1543, Page 313, Orange County Registry. S. Restrictions appearing in that Declaration of Deed Restrictions between Inter- Faith Council for Social Service, Inc. and North Carolina Housing Finance Agency recorded in Book 1636, Page 300, Orange County Registry. 6. Matters shown on plat recorded in: a. Plat Book 59, Page 96; b. Plat Book 78, Page 51; c. Plat Book 78, page 88; d. Plat Book 80, Page 179; and e. Plat Book 102, Page 99, Orange County Registry. 7. Easement(s) and/or Right(s) of way to Duke Power Company as recorded in Book 131 at Page 368 and Book 1610 at Page 213, Orange County Registry. 8. Easement(s) and/or Right(s) of Way to University of North Carolina recorded in Book 136 at Pages 341 and 528, Orange County Registry. 9. Ordinance to Extend the Corporate Limits of the Town of Chapel Hill recorded in Book 725, Page 436, Orange County Registry and adopted Ordinance to Extend the Corporate Limits of the Town of Chapel Hill recorded in Book 818, Page 223, Orange County Registry. 10.Deed of Easement to Orange Water and Sewer Authority recorded in Book 1684, Page 47 and Book 1684, Page 50, Orange County Registry. 11.Right of Way Agreement between Orange County and Duke Energy Corporation recorded in Book 3800, Page 116 and Book 4162, Page 547, Orange County Registry. 12.Stormwater Operations and Management Plan recorded in Book 4349, Page 234, Orange County Registry. 13.Orange Water and Sewer Authority Dedication recorded in Book 4504, Page 77, Orange County Registry. 14.Town of Chapel Hill Special Use Permit recorded in Book 1283, Page 256, Orange County Registry as modified by that Modification of Special Use Permit recorded in Book 1437, Page 33; by Special Use Permit Modification recorded in Book 4349, Page 228; and by that Special Use Permit Modification recorded in Book 5878, Page 49, Orange County Registry. 13 21 Attachment 3 s*h draft of April 8 Third Supplemental Trust Agreement by and between Orange County, North Carolina and The Bank of New York Mellon Trust Company, N.A., as Trustee Relating to the issuance of [$43,000,000] Limited Obligation Bonds Series 2020 22 THIS THIRD SUPPLEMENTAL TRUST AGREEMENT is dated as of May 1, 2020 (this "Supplemental Agreement"), is between ORANGE COUNTY, NORTH CAROLINA, a political subdivision of the State of North Carolina (the "County"), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association having an office in Jacksonville, Florida, as trustee (the "Trustee"), and relates to the issuance of [$43,000,000] Limited Obligation Bonds, Series 2020 (the "2020 Bonds"). RECITALS The County and the Trustee executed and delivered a Trust Agreement dated as of June 1, 2018 (the "2018 Agreement"). The 2018 Agreement provides for the issuance of a 2018 series of limited obligation bonds (the "2018 Bonds"), and allows for the issuance of additional series of limited obligation bonds. The 2018 Agreement provides that the parties will enter into a supplemental agreement for each issue of limited obligation bonds. The County and the Trustee are now entering into this Supplemental Agreement to supplement the 2018 Agreement and provide for the issuance of the 2020 Bonds as additional bonds under the Trust Agreement. The 2020 Bonds are issued and secured on a parity with the 2018 Bonds and the rest of the "Prior Bonds," as defined below. The County is issuing the 2020 Bonds to provide funds to be used, together with other available funds, on a project (the "2020 Project") to acquire, construct, equip and otherwise improve a variety of County facilities and assets, including those described in Exhibit A, and to pay financing costs and other related costs. Each of the 2020 Bonds represents an "installment contract" within the meaning of Section 160A-20 of the North Carolina General Statutes, between the County and the owner of that Bond. The Trustee serves under this Supplemental Agreement for and on behalf of the bondholders. Unless the context clearly requires otherwise, capitalized terms used in this Supplemental Agreement and not otherwise defined have the meanings set forth in Exhibit B or in the 'Prior Agreement,"as defined in Exhibit B. 1 23 NOW, THEREFORE, in consideration of the covenants contained in this Supplemental Agreement, the parties agree as follows: ARTICLE I THE 2020 Bonds Section 1.01. Provision for 2020 Bonds; Advance. (a) The County will issue, and the Trustee will authenticate and deliver, 2020 Bonds in an aggregate principal amount of[$43,000,000]. (b) The County acknowledges that the amount paid to it from the issuance and sale of the 2020 Bonds will be $ . The County will use the amount paid as provided in this Supplemental Agreement to pay 2020 Project Costs. Section 1.02. Bonds Constitute Installment Contracts. Each of the 2020 Bonds, together with the County's corresponding obligations under the Trust Agreement and the Deed of Trust, constitutes a separate"installment contract"within the meaning of Section 160A-20 between the County and the owner of that Bond. The County's payment obligations, and its other obligations under this Agreement and with respect to the Bonds, are secured by the lien on the Mortgaged Property created under the Deed of Trust and by the other security provided for in the Trust Agreement. Section 1.03. Agreement Supplements 2018 Agreement; 2020 Bonds Are Additional Bonds. (a) This Supplemental Agreement is a "supplemental agreement" for the issuance of Additional Bonds as provided in the 2018 Agreement, and the 2020 Bonds are "Additional Bonds" as defined in the 2018 Agreement. (b) Except as modified by this Supplemental Agreement, all terms of the Prior Agreement remain in effect and apply with respect to the 2020 Bonds to the same extent as to all Prior Bonds. Section 1.04. Form and Details; Payments. The 2020 Bonds will be issued as a single fully registered bond designated "Limited Obligation Bond, Series 2020," and in substantially the form of Exhibit C, with any changes as the Trust Agreement permits or requires. This 2020 Bond will be (a) dated the date of its initial 2 24 delivery to the Lender, (b) payable as to interest semiannually until payment on each Payment Date at the annual rate of 2.70% (calculated based on a 360-day year consisting of twelve 30-day months and subject to adjustment as provided below), and (c) payable as to principal on October 1 in installments in years and amounts as follows: Maturity Date Principal Maturity Date Principal (October 11 Amount ($1 (October Amount f$1 [To come] Exhibit D shows a schedule of payments due on the 2020 Bonds with respect to each Payment Date. Upon any prepayment or redemption of the 2020 Bonds, the County will recalculate the schedule of payments to reflect the redemption, and will then deliver a substitute Exhibit D to the Trustee reflecting the recalculated payment schedule. Section 1.05. Interest Rate and Payment Adjustment. Upon any "Rate Adjustment Event," as defined below, (a) the unpaid principal of the 2020 Bonds will continue to be payable as shown in Section 1.04,but(b) the interest on the 2020 Bonds shall be recalculated, at an interest rate equal to an annualized interest rate equal to the "Prime Rate," as defined below, plus 2% (200 basis points),to the date (retroactively, if need be) determined pursuant to the Rate Adjustment Event to be the date interest became includable in any Bondholder's gross income for federal income tax purposes. The Bondholder shall promptly prepare a substitute debt service schedule reflecting the new interest rate and resulting payment schedule, and deliver a copy of the new schedule to the County, the Trustee and to the LGC. The County shall pay interest at each adjusted rate as in effect from time to time (subject to credit for interest previously paid) to each affected Bondholder, notwithstanding the fact that any particular Bondholder may not be a Bondholder on 3 25 the date of a Rate Adjustment Event. The County shall additionally pay to all affected Bondholders any interest, penalties or other charges assessed against or payable by such Bondholder and attributable to a Rate Adjustment Event, notwithstanding the prior repayment of the 2020 Bonds in full or any transfer to another Bondholder. The Trustee has no responsibility to calculate any such additional interest, penalties or charges, or to confirm that any have been paid,with those matters lying only between the County and the affected Bondholders. "Rate Adjustment Event" means (1) any action by the Internal Revenue Service (including the delivery of a deficiency notice) or any other federal court or administrative body or (2) receipt by the Bondholder of an opinion of nationally- recognized bond counsel acceptable to the County, in either case determining in effect that interest on the 2020 Bonds is includable in gross income for federal income tax purposes as a result of (i) any action the County takes, or fails to take, or (ii) any representation made by the County being a misrepresentation. "Prime Rate" means the rate by that name published by Capital One Bank, N.A., as in effect from time to time, whether or not that bank or any affiliate at any time is the registered Bondholder. Section 1.06. Redemption Dates and Prices. The 2020 Bonds are subject to redemption as described in Section 2.01. Section 1.07. Delivery of 2020 Bonds. The Trustee will authenticate and deliver the 2020 Bonds when it has received the following items: a) Certified copies of County Board resolutions (i) approving the terms and conditions under which the 2020 Bonds are to be executed and delivered and (ii) authorizing the execution, delivery and issuance of the 2020 Bonds, this Supplemental Agreement, and Deed of Trust Supplement #3 (as described in Exhibit B) b) Evidence satisfactory to the Trustee that the LGC has approved the issuance of the 2020 Bonds c) An executed copy of this Supplemental Agreement 4 26 d) An executed copy of Deed of Trust Supplement#3,which extends the benefit of the security provided to the Trustee under the Prior Deed of Trust to secure the County's performance of its obligations under this Supplemental Agreement and 2020 Bonds, as contemplated by Section 1.06(iv) of the 2018 Agreement e) An Opinion of Bond Counsel to the effect that the execution and delivery of the 2020 Bonds as Additional Bonds is permitted under the terms of the Prior Agreement and has been duly authorized f) A County Certificate directing the Trustee as to the application of the proceeds from the sale of the 2020 Bonds g) Evidence of the issuance or proposed issuance of one or more lender's title insurance policies (or an appropriate endorsement to an existing policy) in favor of the Trustee, in an aggregate face amount of insurance equal to the total amount of Outstanding Bonds plus the principal amount of the 2020 Bonds, and including the instrument referenced in (d) above as an insured instrument Section 1.08. Limited Obligation. The 2020 Bonds are limited obligations of the County, as provided and described in Section 4.05 of the 2018 Agreement. ARTICLE II REDEMPTION Section 2.01. Redemption Dates and Prices. (a) The County may redeem the 2020 Bond in whole or in part on any Payment Date. Under this subsection, the redemption amount must be at least$500,000 and not more than $1,000,000, and the County may make only one partial redemption in any calendar year. In addition, under this subsection the source of funds for redemption under this subsection may not be proceeds of any obligations issued to refinance the 2020 Bond. If the County redeems a portion of the 2020 Bond, the County will prepare, and the Trustee will deliver, a new 2020 Bond in principal amount equal to the unpaid portion to the registered owner upon the surrender of the 2020 Bond. 5 27 (b) In addition, the County may redeem the 2020 Bond in whole, but not in part, on any date on or after October 1, 2030, by paying all interest accrued and unpaid to the redemption date and all the unpaid principal. (c) No premium or penalty is payable for a redemption made under this Section. Section 2.02. Redemption Notices. (a) The Trustee,at the County's direction, upon being satisfactorily indemnified by the County with respect to expenses and with at least two Business Days' notice, will send notice of redemption no less than 30 nor more than 60 days prior to the redemption date, to the registered owner of the 2020 Bond at its address as it appears on the Trustee's registration books, by registered or certified mail.The Trustee shall also send a copy of the notice to the LGC. (b) Any redemption notice may state that the redemption to be effected is conditioned upon -- (i) the Trustee's receipt on or prior to the redemption date of moneys sufficient to pay the principal of and interest on the 2020 Bonds or portions thereof to be redeemed; or (ii) any other condition not unacceptable to the Trustee. If a notice contains a condition and the Trustee either (i) does not receive moneys sufficient to pay the principal of and interest on the 2020 Bonds on or prior to the redemption date, or (ii) the stated condition is not fulfilled, in either case on or before the redemption date, then redemption will not be made,and the Trustee must,within a reasonable time, give notice the same way the redemption notice was given that the moneys were not so received (or condition was not fulfilled) and the redemption was not made. (c) Each redemption notice must specify (i) the complete designation of the 2020 Bonds to be redeemed, (ii) the CUSIP numbers of the 2020 Bonds to be redeemed, if any, (iii) the dated dates, maturity dates and interest rates of the 2020 6 28 Bonds to be redeemed, (iv) the date fixed for redemption, (v) any conditions to the redemption, as contemplated by subsection (b) above, (vi) the principal amount of 2020 Bonds or portions thereof to be redeemed, (vii) the applicable redemption price, (viii) the address of the place or places of payment, (ix) the Trustee's name and telephone number, and the name of a contact person, (x) that interest accrued to the date fixed for redemption will be paid as specified in the notice, and (xi) that on and after the established redemption date, interest on 2020 Bonds which have been redeemed will cease to accrue. The Trustee must also include in any redemption notice any additional information provided by the County for use in the notice. Section 2.04. 2020 Bonds Payable on Redemption Date; Interest Ceases To Accrue. If on or before the date fixed for redemption funds are deposited with the Trustee to pay the principal of and interest accrued to the redemption date on 2020 Bonds called for redemption, the 2020 Bonds (or portions of 2020 Bonds) called for redemption cease to accrue interest from and after the redemption date. Thereafter, those 2020 Bonds (a) are no longer entitled to the benefits provided by the Trust Agreement and (b) are not deemed to be Outstanding under the Trust Agreement. ARTICLE III DEPOSIT AND USE OF 2020 PROCEEDS; OTHER FUNDS Section 3.01. Disbursement of Proceeds. The Trustee will apply proceeds from the sale of the 2020 Bonds as provided in the certificate described in Section 1.07(f). Section 3.02. Creation and Use of 2020 Proceeds Fund. The Trustee will establish a special fund designated as the "Orange County 2020 Proceeds Fund." The Trustee will keep this Fund separate and apart from all other funds and moneys held by it, and will hold and administer this Fund as provided in this Supplemental Agreement. Moneys in the 2020 Proceeds Fund will be expended only as described in Sections 3.03 and 3.04. The Trustee is not required to disburse any moneys from the 2020 Proceeds Fund during the continuation of any Event of Default. Section 3.03. Deposits to 2020 Proceeds Fund; Payment of Project Costs. (a) The Trustee will deposit into the 2020 Proceeds Fund the amount 7 29 specified in the certificate referenced in Section 1.07(f) and all other amounts paid to it for deposit in the 2020 Proceeds Fund. (b) The Trustee will disburse moneys in the 2020 Proceeds Fund from time to time, either to pay 2020 Project Costs directly or to reimburse the County for previous expenditures on any of those costs, upon receipt of a requisition substantially in the form of Exhibit E. The Trustee will accept requisitions that the County submits by electronic mail or by facsimile transmission. The Trustee may rely conclusively on requisitions as authorization for payments, and the Trustee has no duty or responsibility to verify any matters in the requisitions. (c) Unless otherwise directed by the County, the Trustee will disburse moneys from the 2020 Proceeds Fund that are due to the County by wire transfer to any bank account in the United States as the County may designate to the Trustee from time to time. Section 3.04. Transfer of Unexpended Proceeds. Upon the first to occur of (a) July 1, 2023, or (b) receipt of a County Certificate stating that there are no more 2020 Project Costs to be paid from the 2020 Proceeds Fund, the Trustee will withdraw all remaining moneys in the 2020 Proceeds Fund and deposit those moneys in the Payment Fund. The Trustee will then apply those moneys to Bond payments as directed by a County Representative. In the absence of any direction from the County, the Trustee will deposit those moneys in the Interest Account and use them to pay interest on the 2020 Bonds as the same becomes due. Section 3.05. Use of Funds and Accounts from 2018 Agreement. The Trustee is to maintain and administer the Bond Payment Fund (and its principal and interest accounts) and the Net Proceeds Fund established under the 2018 Agreement to the same effect and purpose as provided in the 2018 Agreement with respect to the 2020 Bonds as to the 2018 Bonds and all Bonds generally. ARTICLE IV MISCELLANEOUS PROVISIONS Section 4.01. Notices. 8 30 (a) Any communication provided for in this Supplemental Agreement or the 2020 Bonds must be in writing (not to include facsimile transmission or electronic mail, except as provided in Section 3.03). (b) Any communication sent under this Agreement must also be sent to the County and the Trustee, along with any other parties to which the communication may be addressed. Any party sending a communication under this Supplemental Agreement must also send a copy to the Lender,so long as the Lender is the registered owner of the 2020 Bond. Any party sending a communication under this Supplemental Agreement that relates to amendments or defaults must also send a copy to the LGC. (c) Any communication under this Supplemental Agreement will be deemed given on the delivery date shown on a United States Postal Service certified mail receipt, or a delivery receipt (or similar evidence) from a national commercial package delivery service, if addressed as follows: (i) if to the County, to Orange County Manager, Re: Notice under 2020 LOBs Trust Agreement, Post Office Box 8181, Hillsborough, NC 27278 (ii) if to the Trustee, to The Bank of New York Mellon Trust Company, N.A., Re: Notice for 2020 Financing for Orange County, 10161 Centurion Parkway North, Jacksonville, FL 32256 (iii) If to the LGC, to the North Carolina Local Government Commission, Attn: Secretary of the Commission, Re: Notice for 2020 Orange County LOBs Financing, Longleaf Building, 3200 Atlantic Ave., Raleigh, NC 27604 (iv) If to the Lender, to (d) Any addressee (including the LGC and the Lender) may designate additional or different addresses for communications by notice given under this Section to each of the others. (e) Whenever this Supplemental Agreement requires the giving of a notice, the person entitled to receive the notice may waive the notice, in writing. The giving 9 31 or receipt of the notice will then not be a condition to the validity of any action taken in reliance upon the waiver. Section 4.02. Definition of "Restricted Yield." With respect to the 2020 Bonds, a "Restricted Yield" means a "yield," within the meaning of Treas. Regs. Secs. 1.103-13(c), -13(d), 1.148-9T(a), or any successor or other provision that may be applicable, not in excess of a "yield" equal to %. Section 4.03. Consent to Jurisdiction. The Trustee consents to jurisdiction in the State of North Carolina for any lawsuit arising from this Supplemental Agreement, or arising from any of the related transactions contemplated by this Supplemental Agreement. Section 4.04. Binding Effect; Limitation of Rights. This Supplemental Agreement is binding upon, inures to the benefit of and is enforceable by the parties and their respective successors and assigns. Nothing expressed or implied in this Supplemental Agreement or the 2020 Bonds gives any person other than the Trustee, the County and the Owners any right, remedy or claim under or with respect to this Supplemental Agreement. Section 4.05. Severability. If any provision of this Supplemental Agreement is determined to be unenforceable, that does not affect any other provision of this Supplemental Agreement. Section 4.06. Counterparts. This Supplemental Agreement may be signed in several counterparts,including separate counterparts. Each will be an original,but all of them together constitute the same instrument. Section 4.07. Restriction on transfer. Notwithstanding any indication in the Master Agreement to the contrary, the Trustee will not register the transfer of any 2020 Bond to any person other than a bank, an insurance company or a similar financial institution unless the LGC has previously approved the transfer. Section 4.08. Definitions; Rules of Interpretation. Unless the context clearly requires otherwise, capitalized terms used as defined terms in this Supplemental Agreement and not otherwise defined have the meanings set forth in Exhibit B, and if not defined there will have the meanings set forth in the Prior 10 32 Agreement. This Supplemental Agreement will be interpreted in accordance with the rules of interpretation set forth in the 2018 Agreement. [The remainder of this page has been left blank intentionally.] 11 33 IN WITNESS WHEREOF,the parties have caused this Third Supplemental Trust Agreement to be executed in their corporate names by their duly authorized officers, all as of May 1, 2020. (SEAL) ATTEST: ORANGE COUNTY, NORTH CAROLINA By: Donna S. Baker Bonnie B. Hammersley Clerk, Board of Commissioners County Manager The Bank of New York Mellon Trust Company, N.A., as Trustee By: Terence Rawlins,Vice President [Third Supplemental Trust Agreement dated as of May 1, 2020] 12 34 Exhibit A - list of projects to be financed with estimated amounts Component Estimated Cost Facility, Accessibility, Safety and Security Projects $ 212,634 Generator Projects $ 33,000 HVAC Projects $ 230,218 Major Plumbing Repairs $ 50,885 Northern Campus— Detention Center $ 21,989,681 Northern Campus— EAC $ 5,677,065 Northern Campus— Parks Operations $ 1,404,810 Government Services (Link) Remediation $ 581,503 Skill Development Relocation - Europa Center Upfits $ 254,953 Roofing and Fagade Projects $ 686,167 Parks and Recreation Facility Renovations. Repairs, Safety Improvements $ 246,500 Conservation Easements $ 259,514 River Park, Phase II $ 118,509 ITGC Initiatives $ 197,826 IT Infrastructure $ 489,910 Communication Systems $ 273,221 Solid Waste - Equipment and Vehicles $ 717,228 Solid Waste -Administrative Building Remediation $ 281,324 Sportsplex Capital Items - 2 Vans $ 70,090 Schools - Recurring Capital Needs $ 3,000,000 Schools - Improvements to Older Facilities $ 472,941 Schools—Other Various Projects $ 3,242,252 Total Project Costs $ 40,490,231 The County also expects to use financing proceeds to pay Financing Costs. The amounts stated above are estimates only. The County may use any portion of the 2020 Bond proceeds for any of the 2020 Project Costs, subject to the County's obligation to undertake and complete those components of the project related to the 13 35 "Mortgaged Property," as defined in the Deed of Trust, and the limitation on the use of funds only for 2020 Project Costs. Components of the 2020 Project related to the Mortgaged Property include the following: • The Northern Campus improvements described in the table above • The Link Center and Emergency Services Building remediations referenced in the table above 14 36 EXHIBIT B - Definitions: Rules of Construction For all purposes of this Supplemental Agreement, unless the context requires otherwise, the following terms have the following meanings. "2020 Bonds" means the County's Limited Obligation Bonds, Series 2020, originally issued in the aggregate principal amount of [$43,000,000] pursuant to the Prior Agreement and this Supplemental Agreement. "2020 Proceeds Fund" means the Orange County 2020 Proceeds Fund established pursuant to Section 3.02. "2020 Project"has the meaning assigned in the preambles to this Supplemental Agreement. "2020 Project Costs" means "Project Costs," as defined in the 2018 Agreement, related to the 2020 Project. "Deed of Trust" means the Prior Deed of Trust as modified by the "Deed of Trust Supplement #3" dated as of May 1, 2020, also granted by the County for the Trustee's benefit. "Payment Date" with respect to the 2020 Bonds means each April 1 and October 1, beginning October 1, 2020. "Prior Agreement" means the Trust Agreement dated as of June 1, 2018, between the County and The Bank of New York Mellon Trust Company, N.A., as trustee, as supplemented by (a) a First Supplemental Trust Agreement dated as of April 1, 2019, between the County and the Trustee, and (a) a Second Supplemental Trust Agreement dated as of November 1, 2019, also between the County and the Trustee. "Prior Deed of Trust" means the Deed of Trust and Security Agreement dated as of June 1, 2018, from the County to a Deed of Trust Trustee for the County's benefit, as supplemented by (a) a Deed of Trust Supplement#1 dated as of April 1, 2019, and (b) a Deed of Trust Supplement#2 dated as of November 1, 2019. 15 37 "Supplemental Agreement" means this Third Supplemental Trust Agreement, as it may be properly amended or supplemented from time to time. "Trust Agreement" means the Prior Agreement as modified and supplemented by this Supplemental Agreement, as it may be further amended or supplemented from time to time. All other capitalized terms used in this Third Supplemental Trust Agreement and not otherwise defined have the meanings ascribed thereto in the Prior Agreement. 16 38 Exhibit C - Form of 2020 Bond Registered Bond Number R-1 LIMITED OBLIGATION BOND, SERIES 2020 ORANGE COUNTY, NORTH CAROLINA ORANGE COUNTY, NORTH CAROLINA (the "County"), for value received, promises to pay, but solely from the sources and in the manner provided, to Capital One Public Funding, LLC or registered assigns (the "Bondholder"), the principal sum of [FORTY-THREE MILLION DOLLARS] [*****$431000,000*****] in principal installments payable on each October 1 as shown on Schedule I. together with interest on the unpaid principal from the date hereof until payment of the entire principal sum at the annual rate of 2.70%, payable on each April 1 and October 1, beginning October 1, 2020, subject to redemption and adjustment as described below. Interest is payable (a) from May_, 2020, if this Bond is authenticated prior to October 1, 2020, or (b) otherwise from the April 1 or October 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). In all events, (1) all payments on this Bond will be applied first to interest accrued and unpaid to the payment date and then to principal, and (2) if not sooner paid,the entire principal of and interest on this Bond will be due and payable on October 1, 2040. Principal and interest are payable in lawful money of the United States of America. 17 39 Upon any"Rate Adjustment Event," as defined below, (a) the unpaid principal of the this Bond will continue to be payable as shown in Schedule I,but (b) the interest on the this Bond shall be recalculated, at an interest rate equal to an annualized interest rate equal to the "Prime Rate," as defined below, plus 2% (200 basis points),to the date (retroactively, if need be) determined pursuant to the Rate Adjustment Event to be the date interest became includable in any Bondholder's gross income for federal income tax purposes. The Bondholder shall promptly prepare a substitute debt service schedule reflecting the new interest rate and resulting payment schedule, and deliver a copy of the new schedule to the County, the Trustee (as defined below) and to the LGC (as defined below). The County shall pay interest at each adjusted rate as in effect from time to time (subject to credit for interest previously paid) to each affected Bondholder, notwithstanding the fact that any particular Bondholder may not be a Bondholder on the date of a Rate Adjustment Event. The County shall additionally pay to all affected Bondholders any interest, penalties or other charges assessed against or payable by such Bondholder and attributable to a Rate Adjustment Event, notwithstanding the prior repayment of this Bond in full or any transfer to another Bondholder. The Trustee has no responsibility to calculate any such additional interest, penalties or charges, or to confirm that any have been paid, with those matters lying only between the County and the affected Bondholders. "Rate Adjustment Event" means (1) any action by the Internal Revenue Service (including the delivery of a deficiency notice) or any other federal court or administrative body or (2) receipt by the Bondholder of an opinion of nationally- recognized bond counsel acceptable to the County, in either case determining in effect that interest on the this Bond is includable in gross income for federal income tax purposes as a result of (i) any action the County takes, or fails to take, or (ii) any representation made by the County being a misrepresentation. "Prime Rate" means the rate by that name published by Capital One Bank, N.A., as in effect from time to time, whether or not that bank or any affiliate at any time is the registered Bondholder. 18 40 This Bond constitutes the entire issue of [$43,000,000] Limited Obligation Bonds, Series 2020 (the "Bonds"), issued under, and equally and ratably secured by, a Trust Agreement dated as of June 1, 2018,between the County and The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee"), as previously supplemented and as supplemented by a Third Supplemental Trust Agreement between the County and the Trustee and dated as of May 1, 2020 (as supplemented, the "Trust Agreement"). This Bond constitutes an installment contract within the meaning of Section 160A-20 of the North Carolina General Statutes between the County and the owner (from time to time) of this Bond. The Bond is payable solely from funds appropriated on an annual basis by the County's governing Board of Commissioners and other funds available for the purpose of payment pursuant to the Trust Agreement, such as certain net insurance and condemnation awards and the proceeds of remedial action, which revenues and other moneys have been pledged as described in the Trust Agreement to secure payment of the Bond. Neither the County's faith and credit nor its taxing power is pledged to the payment of any amounts due under the Bond. As provided for under that Section 160A-20, no deficiency judgment may be rendered against the County in any action for breach of a contractual obligation under the Bond or the Trust Agreement. To further secure its obligations under the Trust Agreement, the County has granted, for the benefit of the Trustee on behalf of the owners of the Bonds, a security interest in certain public facilities and the related real property, and certain other property, pursuant to the Trust Agreement and a Deed of Trust and Security Agreement dated as of June 1, 2018, as previously supplemented and as supplemented by a Deed of Trust Supplement #3 dated as of May 1, 2020, delivered by the County for the Trustee's benefit (as supplemented, the "Deed of Trust"). The security provided to owners of the Bond under the Deed of Trust and otherwise is on parity with the security provided to owners of prior bonds issued under the Trust Agreement. Additional Bonds secured by a parity interest in the property securing the Bond may be issued under the terms and conditions set forth in the Trust Agreement. Reference is made to the Trust Agreement and the Deed of Trust referenced above for the provisions, among others, with respect to the nature and extent of the 19 41 security,the rights, duties and obligations of the County and the Trustee, the rights of the Owners of the Bond and the terms upon which the Bond is executed, delivered and secured, to all of which provisions the owner of this Bond, by the acceptance of this Bond, agrees. This Bond may not be redeemed prior to maturity except as provided in this Bond and in the Trust Agreement. The County may redeem this Bond in whole or in part on any April 1 or October 1, provided that (a) the redemption amount must be at least $500,000 and not more than $1,000,000, (b) the County may make only one partial redemption in any calendar year, and (c) the source of funds for redemption may not be proceeds of any obligations issued to refinance this Bond. If the County redeems a portion of this Bond, the County will prepare, and the Trustee will deliver, a new bond in principal amount equal to the unpaid portion to the registered owner upon the surrender of the Bond. In addition, the County may redeem this Bond in whole, but not in part, on any date on or after October 1, 2030, by paying all interest accrued and unpaid to the redemption date and all the unpaid principal. No premium or penalty is payable for a redemption made as described above. The Trustee will send redemption notice to the Bondholder, at its address as it appears on the Trustee's Bond Register (as defined in the Trust Agreement),not more than 60 nor less than 30 days prior to the redemption date. If on or before the date fixed for redemption funds have been deposited with the Trustee to pay the principal and interest accrued to the redemption date with respect to the Bond called for redemption, the Bond or portion called for redemption will cease to accrue interest from and after the redemption date, will no longer be entitled to the benefits provided by the Trust Agreement, and will not be deemed to be Outstanding under the Trust Agreement. The Owner of this Bond has no right to enforce the provisions of the Trust Agreement or to institute action to enforce the covenants therein, or to take any action with respect to any event of default thereunder, or to institute, appear in or 20 42 defend any suit or other proceeding with respect thereto, except as provided in the Trust Agreement. Changes to or supplements of the Trust Agreement may be made to the extent and in the circumstances permitted by the Trust Agreement. Ownership of this Bond will be registered on the Bond Register (as defined in the Trust Agreement) kept for that purpose by the Trustee, which will act as Bond registrar. This Bond may be exchanged, and its transfer may be effected, only by its Owner in person or by attorney duly authorized in writing at the designated office of the Trustee, but only in the manner, subject to the limitations and upon payment of the charges provided in the Trust Agreement, and upon surrender and cancellation of this Bond. The Trustee will not register the transfer of the Bond to any person other than a bank, an insurance company or a similar financial institution unless the North Carolina Local Government Commission has previously approved the transfer. Upon exchange or registration of such transfer a new registered Bond of the same maturity and interest rate for the same aggregate principal amount will be issued in exchange therefor. The County and the Trustee may deem and treat the person in whose name this Bond is registered on the Bond Register as the absolute owner of this Bond for the purpose of receiving payment of or on account of principal of and interest due on this Bond and for all other purposes, and neither the County nor the Trustee will be affected by any notice to the contrary, except that interest payments will be made to the persons shown as Owners on the Trustee's registration books on the Record Date, which is the end of the calendar day on the 15th day of the month (whether or not a business day) preceding each Payment Date. 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 execution and delivery of this Bond have happened, exist and have been performed. The County intends that North Carolina law will govern this Bond and all matters of its interpretation. This Bond will not be entitled to any benefit under the Trust Agreement or be valid or obligatory for any purpose until the Trustee has executed the Certificate of Authentication appearing on this Bond. 21 43 IN WITNESS WHEREOF, the County has caused this instrument to be signed, sealed and delivered by duly authorized officers, all as of May 2020. (SEAL) ORANGE COUNTY ATTEST: NORTH CAROLINA By: Donna S. Baker Bonnie B. Hammersley Clerk, Board of Commissioners County Manager [Orange County, North Carolina [$43,000,000] Limited Obligation Bonds, Series 20201 [Schedule I - Payment Schedule to be attached] 22 44 This Bond has been approved under the provisions of Section 160A-20 and Article 8, Chapter 159 of the General Statutes of North Carolina. Greg C. Gaskins Secretary, North Carolina Local Government Commission By [Greg C. Gaskins or Designated Assistant] CERTIFICATE OF AUTHENTICATION This Bond is the Bond referred to in the Third Supplemental Trust Agreement dated as of May 1, 2020, between Orange County, North Carolina, and The Bank of New York Mellon Trust Company, N.A., as trustee. Date of Authentication: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee By: Authorized Officer [Orange County, North Carolina [$43,000,000] Limited Obligation Bonds, Series 20201 23 45 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 OF TRANSFEREE: the within bond and all rights thereunder, hereby irrevocably constituting and appointing , Attorney, to transfer said certificate on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: (Signature of Owner) NOTICE: The signature above must NOTICE: Signature(s) must be correspond with the name the Owner guaranteed by a participant in the as it appears on the front of this Securities Transfer Agent Medallion certificate in every particular without Program ("STAMP") or similar alteration or enlargement or any program change whatsoever. 24 46 EXHIBIT D - Schedule of Payments on 2020 Bonds Principal is payable in the amounts and on the dates as shown below, subject to redemption of the 2020 Bond as provided in this Supplemental Agreement. Interest is payable on the dates shown below. The 2020 Bonds will bear interest from the Closing Date until paid. Interest is calculated at the annual rate of 2.70%, subject to adjustment as provided in this Supplemental Agreement. The schedule below shows the expected interest payment amounts. The County's obligation with respect to the 2020 Bonds on each Payment Date is the amount shown below as the "total payment" for that date, subject to adjustment as provided in Section 3.05(c) of the 2018 Agreement. Payments are due to the Bondholders on the indicated Payment Dates. The County will deposit the amounts required for payment with the Trustee by the 25tn day of the month preceding the Payment Date. Payment Date Principal Interest Total Payment [To come] 25 47 Exhibit E - Form of Requisition [Date] The Bank of New York Mellon Trust Company, N.A., as Trustee Attention: Corporate Trust Regarding: Requisition under 2020 Supplemental Trust Agreement for Orange County, North Carolina RE: Request by Orange County, North Carolina (the "County"), for disbursement of funds from a Bond Proceeds Fund created under a Third Supplemental Trust Agreement dated as of May 1, 2020 (the "2020 Agreement"), with Orange County, North Carolina (the "County") To the Trustee: Pursuant to the terms and conditions of the 2020 Agreement, the County authorizes and requests the disbursement of funds from the "Orange County 2020 Proceeds Fund" established under that 2020 Agreement for the costs described below. Capitalized terms used in this requisition and not otherwise defined have the meanings ascribed in the 2020 Agreement. This is requisition number 2020 - from the 2020 Proceeds Fund. Total Amount for Disbursement Payee Payee's address 26 48 Orange County makes this requisition pursuant to the following representations: 1. The County has appropriated in its current fiscal year funds sufficient to pay the Bond Payments and estimated Additional Payments due in the current fiscal year. 2. The purpose of this disbursement is for payment of 2020 Project Costs as provided for in the Trust Agreement. 3. The requested disbursement has not been subject to any previous requisition. 4. No notice of any lien, right to lien or attachment upon, or claim affecting the right to receive payment of, any of the moneys payable herein to any of the persons,firms or corporations named herein has been received,or if any notice of any such lien, attachment or claim has been received, such lien, attachment or claim has been released or discharged or will be released or discharged upon payment of this requisition. S. This requisition contains no items representing payment on account of any percentage entitled to be retained on the date of this requisition. 6. No Event of Default is continuing, and no event or condition is existing which, with notice or lapse of time or both, would become an Event of Default. 7. The County has insurance in place that complies with the insurance requirements of the Trust Agreement. 8. No portion of the amounts set forth in this requisition represents amounts paid or payable as North Carolina state sales taxes. ORANGE COUNTY, NORTH CAROLINA By: !Exhibit Form Only-Do Not Sign] Title: County Representative 27 49 Attachment 4 Explanation of School Capital Funding Schools—Recurring Capital • Schools must use Recurring Capital outlay funds in one or more of the following categories: o Category I—Facility Improvements o Category II—Equipment and Furnishings o Category III—Vehicles and Bus Purchases Schools—Improvements to Older Facilities • When the 2016 Bond Referendum was approved for$120 million for Schools,the Board of County Commissioners also approved $5 million ($1 million over a 5-year period)for Schools to use towards improvements to their older facilities, as outlined in the Assessment studies of Older Facilities. This funding began in FY 2016-17 and the final year of this funding is scheduled for FY 2020-21. Schools—Other Various Projects • These funds are part of the annual funding provided to Schools to go towards their long range capital needs as outlined in the Capital Investment Plan. 50 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) TABLE OF CONTENTS Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Report Page Limited Obligation Bond,Series 2020 Sources and Uses of Funds . . . . . . . . . . . . . . . . . . . . . . . . 1 Bond Summary Statistics . . . . . . . . . . . . . . . . . . . . . . . . . 2 Bond Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Net Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Proof of Arbitrage Yield . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Form 8038 Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 51 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) Page 1 SOURCES AND USES OF FUNDS Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Dated Date 05/08/2020 Delivery Date 05/08/2020 Limited Obligation Bond,Series Sources: 2020 Bond Proceeds: Par Amount 40,731,000.00 40,731,000.00 Limited Obligation Bond,Series Uses: 2020 Project Fund Deposits: IT-Governance Council Initiatives 197,826.00 IT Infrastructure 489,910.00 Solid Waste-Equipment and Vehicles 717,228.00 Sportsplex Capital Items-2 Vans 70,090.00 Communication Systems(Portable Radios) 273,221.00 Schools Recurring Capital 3,000,000.00 Parks and Recreation Facility Renovations 246,500.00 HVAC Projects 230,218.00 Conservation Easements 259,514.00 Facility Accessibility&Security Improvements 212,634.00 Generator Projects 33,000.00 Major Plumbing Repairs 50,885.00 North Campus Detention Center 21,989,681.00 Northern Campus Environment and Ag Center 5,677,065.00 Northern Campus Parks Operations Center 1,404,810.00 River Park, Phase II 118,509.00 Roofing Projects 686,167.00 Schools Older Facilities Improvements 472,941.00 Schools Various Facilities Improvements 3,242,252.00 Skills Development Relocation(Europa) 254,953.00 Government Services(Link)Remediation 581,503.00 Solid Waste-Administrative Building Remediation 281,324.00 40,490,231.00 Cost of Issuance: Cost of Issuance 240,000.00 Other Uses of Funds: Additional Proceeds 769.00 40,731,000.00 52 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) Page 2 BOND SUMMARY STATISTICS Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Dated Date 05/08/2020 Delivery Date 05/08/2020 Last Maturity 10/01/2040 Arbitrage Yield 2.700173% True Interest Cost(TIC) 2.700173% Net Interest Cost(NIC) 2.700000% All-In TIC 2.770146% Average Coupon 2.700000% Average Life(years) 10.116 Duration of Issue(years) 8.572 Par Amount 40,731,000.00 Bond Proceeds 40,731,000.00 Tota I Interest 11,124,681.99 Net Interest 11,124,681.99 Total Debt Service 51,855,681.99 Maximum Annual Debt Service 3,525,540.50 Average Annual Debt Service 2,542,291.37 Underwriter's Fees(per$1000) Average Takedown Other Fee Total Underwriter's Discount Bid Price 100.000000 Par Average Average Bond Component Value Price Coupon Life Serial Bonds 40,731,000.00 100.000 2.700% 10.116 40,731,000.00 10.116 All-in Arbitrage TIC TIC Yield Par Value 40,731,000.00 40,731,000.00 40,731,000.00 +Accrued Interest + Premium(Discount) Underwriter's Discount Cost of Issuance Expense (240,000.00) Other Amounts Target Value 40,731,000.00 40,491,000.00 40,731,000.00 Target Date 05/08/2020 05/08/2020 05/08/2020 Yield 2.700173% 2.770146% 2.700173% 53 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) Page 3 BOND PRICING Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Maturity Bond Component Date Amount Rate Yield Price Serial Bonds: 10/01/2021 2,459,000 2.700% 2.700% 100.000 10/01/2022 2,467,000 2.700% 2.700% 100.000 10/01/2023 2,473,000 2.700% 2.700% 100.000 10/01/2024 2,481,000 2.700% 2.700% 100.000 10/01/2025 2,489,000 2.700% 2.700% 100.000 10/01/2026 2,347,000 2.700% 2.700% 100.000 10/01/2027 2,351,000 2.700% 2.700% 100.000 10/01/2028 2,228,000 2.700% 2.700% 100.000 10/01/2029 1,813,000 2.700% 2.700% 100.000 10/01/2030 1,813,000 2.700% 2.700% 100.000 10/01/2031 1,789,000 2.700% 2.700% 100.000 10/01/2032 1,789,000 2.700% 2.700% 100.000 10/01/2033 1,789,000 2.700% 2.700% 100.000 10/01/2034 1,789,000 2.700% 2.700% 100.000 10/01/2035 1,789,000 2.700% 2.700% 100.000 10/01/2036 1,773,000 2.700% 2.700% 100.000 10/01/2037 1,773,000 2.700% 2.700% 100.000 10/01/2038 1,773,000 2.700% 2.700% 100.000 10/01/2039 1,773,000 2.700% 2.700% 100.000 10/01/2040 1,773,000 2.700% 2.700% 100.000 40,731,000 Dated Date 05/08/2020 Delivery Date 05/08/2020 First Coupon 10/01/2020 Par Amount 40,731,000.00 Original Issue Discount Production 40,731,000.00 100.000000% Underwriter's Discount Purchase Price 40,731,000.00 100.000000% Accrued Interest Net Proceeds 40,731,000.00 54 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2O2O) Page 4 NET DEBT SERVICE Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Total Net Annual Date Principal Coupon Interest Debt Service Debt Service Net D/S 10/01/2020 436,839.99 436,839.99 436,839.99 04/01/2021 549,868.50 549,868.50 549,868.50 06/30/2021 986,708.49 10/01/2021 2,459,000 2.700% 549,868.50 3,008,868.50 3,008,868.50 04/01/2022 516,672.00 516,672.00 516,672.00 06/30/2022 3,525,540.50 10/01/2022 2,467,000 2.700% 516,672.00 2,983,672.00 2,983,672.00 04/01/2023 483,367.50 483,367.50 483,367.50 06/30/2023 3,467,039.50 10/01/2023 2,473,000 2.700% 483,367.50 2,956,367.50 2,956,367.50 04/01/2024 449,982.00 449,982.00 449,982.00 06/30/2024 3,406,349.50 10/01/2024 2,481,000 2.700% 449,982.00 2,930,982.00 2,930,982.00 04/01/2025 416,488.50 416,488.50 416,488.50 06/30/2025 3,347,470.50 10/01/2025 2,489,000 2.700% 416,488.50 2,905,488.50 2,905,488.50 04/01/2026 382,887.00 382,887.00 382,887.00 06/30/2026 3,288,375.50 10/01/2026 2,347,000 2.700% 382,887.00 2,729,887.00 2,729,887.00 04/01/2027 351,202.50 351,202.50 351,202.50 06/30/2027 3,081,089.50 10/01/2027 2,351,000 2.700% 351,202.50 2,702,202.50 2,702,202.50 04/01/2028 319,464.00 319,464.00 319,464.00 06/30/2028 3,021,666.50 10/01/2028 2,228,000 2.700% 319,464.00 2,547,464.00 2,547,464.00 04/01/2029 289,386.00 289,386.00 289,386.00 06/30/2029 2,836,850.00 10/01/2029 1,813,000 2.700% 289,386.00 2,102,386.00 2,102,386.00 04/01/2030 264,910.50 264,910.50 264,910.50 06/30/2030 2,367,296.50 10/01/2030 1,813,000 2.700% 264,910.50 2,077,910.50 2,077,910.50 04/01/2031 240,435.00 240,435.00 240,435.00 06/30/2031 2,318,345.50 10/01/2031 1,789,000 2.700% 240,435.00 2,029,435.00 2,029,435.00 04/01/2032 216,283.50 216,283.50 216,283.50 06/30/2032 2,245,718.50 10/01/2032 1,789,000 2.700% 216,283.50 2,005,283.50 2,005,283.50 04/01/2033 192,132.00 192,132.00 192,132.00 06/30/2033 2,197,415.50 10/01/2033 1,789,000 2.700% 192,132.00 1,981,132.00 1,981,132.00 04/01/2034 167,980.50 167,980.50 167,980.50 06/30/2034 2,149,112.50 10/01/2034 1,789,000 2.700% 167,980.50 1,956,980.50 1,956,980.50 04/01/2035 143,829.00 143,829.00 143,829.00 06/30/2035 2,100,809.50 10/01/2035 1,789,000 2.700% 143,829.00 1,932,829.00 1,932,829.00 04/01/2036 119,677.50 119,677.50 119,677.50 06/30/2036 2,052,506.50 10/01/2036 1,773,000 2.700% 119,677.50 1,892,677.50 1,892,677.50 04/01/2037 95,742.00 95,742.00 95,742.00 06/30/2037 1,988,419.50 10/01/2037 1,773,000 2.700% 95,742.00 1,868,742.00 1,868,742.00 04/01/2038 71,806.50 71,806.50 71,806.50 06/30/2038 1,940,548.50 10/01/2038 1,773,000 2.700% 71,806.50 1,844,806.50 1,844,806.50 04/01/2039 47,871.00 47,871.00 47,871.00 06/30/2039 1,892,677.50 10/01/2039 1,773,000 2.700% 47,871.00 1,820,871.00 1,820,871.00 04/01/2040 23,935.50 23,935.50 23,935.50 06/30/2040 1,844,806.50 10/01/2040 1,773,000 2.700% 23,935.50 1,796,935.50 1,796,935.50 06/30/2041 1,796,935.50 40,731,000 11,124,681.99 51,855,681.99 51,855,681.99 51,855,681.99 55 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) Page 5 NET DEBT SERVICE Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Period Total Net Ending Principal Coupon Interest Debt Service Debt Service 06/30/2021 986,708.49 986,708.49 986,708.49 06/30/2022 2,459,000 2.700% 1,066,540.50 3,525,540.50 3,525,540.50 06/30/2023 2,467,000 2.700% 1,000,039.50 3,467,039.50 3,467,039.50 06/30/2024 2,473,000 2.700% 933,349.50 3,406,349.50 3,406,349.50 06/30/2025 2,481,000 2.700% 866,470.50 3,347,470.50 3,347,470.50 06/30/2026 2,489,000 2.700% 799,375.50 3,288,375.50 3,288,375.50 06/30/2027 2,347,000 2.700% 734,089.50 3,081,089.50 3,081,089.50 06/30/2028 2,351,000 2.700% 670,666.50 3,021,666.50 3,021,666.50 06/30/2029 2,228,000 2.700% 608,850.00 2,836,850.00 2,836,850.00 06/30/2030 1,813,000 2.700% 554,296.50 2,367,296.50 2,367,296.50 06/30/2031 1,813,000 2.700% 505,345.50 2,318,345.50 2,318,345.50 06/30/2032 1,789,000 2.700% 456,718.50 2,245,718.50 2,245,718.50 06/30/2033 1,789,000 2.700% 408,415.50 2,197,415.50 2,197,415.50 06/30/2034 1,789,000 2.700% 360,112.50 2,149,112.50 2,149,112.50 06/30/2035 1,789,000 2.700% 311,809.50 2,100,809.50 2,100,809.50 06/30/2036 1,789,000 2.700% 263,506.50 2,052,506.50 2,052,506.50 06/30/2037 1,773,000 2.700% 215,419.50 1,988,419.50 1,988,419.50 06/30/2038 1,773,000 2.700% 167,548.50 1,940,548.50 1,940,548.50 06/30/2039 1,773,000 2.700% 119,677.50 1,892,677.50 1,892,677.50 06/30/2040 1,773,000 2.700% 71,806.50 1,844,806.50 1,844,806.50 06/30/2041 1,773,000 2.700% 23,935.50 1,796,935.50 1,796,935.50 40,731,000 11,124,681.99 51,855,681.99 51,855,681.99 56 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) Page 6 PROOF OF ARBITRAGE YIELD Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Present Value to 05/08/2020 Date Debt Service Total @ 2.7001731403% 10/01/2020 436,839.99 436,839.99 432,210.63 04/01/2021 549,868.50 549,868.50 536,794.15 10/01/2021 3,008,868.50 3,008,868.50 2,898,197.76 04/01/2022 516,672.00 516,672.00 491,038.58 10/01/2022 2,983,672.00 2,983,672.00 2,797,870.70 04/01/2023 483,367.50 483,367.50 447,228.92 10/01/2023 2,956,367.50 2,956,367.50 2,698,899.62 04/01/2024 449,982.00 449,982.00 405,321.21 10/01/2024 2,930,982.00 2,930,982.00 2,604,912.96 04/01/2025 416,488.50 416,488.50 365,223.70 10/01/2025 2,905,488.50 2,905,488.50 2,513,917.25 04/01/2026 382,887.00 382,887.00 326,872.45 10/01/2026 2,729,887.00 2,729,887.00 2,299,472.60 04/01/2027 351,202.50 351,202.50 291,888.54 10/01/2027 2,702,202.50 2,702,202.50 2,215,915.59 04/01/2028 319,464.00 319,464.00 258,483.68 10/01/2028 2,547,464.00 2,547,464.00 2,033,738.59 04/01/2029 289,386.00 289,386.00 227,950.46 10/01/2029 2,102,386.00 2,102,386.00 1,633,997.10 04/01/2030 264,910.50 264,910.50 203,148.62 10/01/2030 2,077,910.50 2,077,910.50 1,572,234.84 04/01/2031 240,435.00 240,435.00 179,499.87 10/01/2031 2,029,435.00 2,029,435.00 1,494,918.36 04/01/2032 216,283.50 216,283.50 157,196.04 10/01/2032 2,005,283.50 2,005,283.50 1,438,036.34 04/01/2033 192,132.00 192,132.00 135,947.01 10/01/2033 1,981,132.00 1,981,132.00 1,383,118.04 04/01/2034 167,980.50 167,980.50 115,712.58 10/01/2034 1,956,980.50 1,956,980.50 1,330,099.36 04/01/2035 143,829.00 143,829.00 96,453.93 10/01/2035 1,932,829.00 1,932,829.00 1,278,918.21 04/01/2036 119,677.50 119,677.50 78,133.58 10/01/2036 1,892,677.50 1,892,677.50 1,219,207.73 04/01/2037 95,742.00 95,742.00 60,852.65 10/01/2037 1,868,742.00 1,868,742.00 1,171,931.39 04/01/2038 71,806.50 71,806.50 44,431.65 10/01/2038 1,844,806.50 1,844,806.50 1,126,303.45 04/01/2039 47,871.00 47,871.00 28,837.19 10/01/2039 1,820,871.00 1,820,871.00 1,082,269.76 04/01/2040 23,935.50 23,935.50 14,037.01 10/01/2040 1,796,935.50 1,796,935.50 1,039,777.91 51,855,681.99 51,855,681.99 40,731,000.00 Proceeds Summary Delivery date 05/08/2020 Par Value 40,731,000.00 Target for yield calculation 40,731,000.00 57 Apr 13,2020 1:17 pm Prepared by DEC Finance (Finance 8.500 Orange County, NC:2020) Page 7 FORM 8038 STATISTICS Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One Dated Date 05/08/2020 Delivery Date 05/08/2020 Redemption Bond Component Date Principal Coupon Price Issue Price at Maturity Serial Bonds: 10/01/2021 2,459,000.00 2.700% 100.000 2,459,000.00 2,459,000.00 10/01/2022 2,467,000.00 2.700% 100.000 2,467,000.00 2,467,000.00 10/01/2023 2,473,000.00 2.700% 100.000 2,473,000.00 2,473,000.00 10/01/2024 2,481,000.00 2.700% 100.000 2,481,000.00 2,481,000.00 10/01/2025 2,489,000.00 2.700% 100.000 2,489,000.00 2,489,000.00 10/01/2026 2,347,000.00 2.700% 100.000 2,347,000.00 2,347,000.00 10/01/2027 2,351,000.00 2.700% 100.000 2,351,000.00 2,351,000.00 10/01/2028 2,228,000.00 2.700% 100.000 2,228,000.00 2,228,000.00 10/01/2029 1,813,000.00 2.700% 100.000 1,813,000.00 1,813,000.00 10/01/2030 1,813,000.00 2.700% 100.000 1,813,000.00 1,813,000.00 10/01/2031 1,789,000.00 2.700% 100.000 1,789,000.00 1,789,000.00 10/01/2032 1,789,000.00 2.700% 100.000 1,789,000.00 1,789,000.00 10/01/2033 1,789,000.00 2.700% 100.000 1,789,000.00 1,789,000.00 10/01/2034 1,789,000.00 2.700% 100.000 1,789,000.00 1,789,000.00 10/01/2035 1,789,000.00 2.700% 100.000 1,789,000.00 1,789,000.00 10/01/2036 1,773,000.00 2.700% 100.000 1,773,000.00 1,773,000.00 10/01/2037 1,773,000.00 2.700% 100.000 1,773,000.00 1,773,000.00 10/01/2038 1,773,000.00 2.700% 100.000 1,773,000.00 1,773,000.00 10/01/2039 1,773,000.00 2.700% 100.000 1,773,000.00 1,773,000.00 10/01/2040 1,773,000.00 2.700% 100.000 1,773,000.00 1,773,000.00 40,731,000.00 40,731,000.00 40,731,000.00 Stated Weighted Maturity Interest Issue Redemption Average Date Rate Price at Maturity Maturity Yield Final Maturity 10/01/2040 2.700% 1,773,000.00 1,773,000.00 Entire Issue 40,731,000.00 40,731,000.00 10.1158 2.7002% Proceeds used for accrued interest 0.00 Proceeds used for bond issuance costs(including underwriters'discount) 240,000.00 Proceeds used for credit enhancement 0.00 Proceeds allocated to reasonably required reserve or replacement fund 0.00 58 Apr 13,2020 1:17 pm Prepared by DBC Finance (Finance 8.500 Orange County, NC:2020) Page 8 DISCLAIMER Orange County, NC Limited Obligation Bond,Series 2020 Final Numbers Capital One The U.S.Securities and Exchange Commission(the'SEC')has clarified that a broker,dealer or municipal securities dealer engaging in municipal advisory activities outside the scope of underwriting a particular issuance of municipal securities should be subject to municipal advisor registration.Davenport&Company LLC('Davenport')has registered as a municipal advisor with the SEC.As a registered municipal advisor Davenport may provide advice to a municipal entity or obligated person.An obligated person is an entity other 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ORANGE COUNTY NORTH CAROLIN 2020 Bank Financing Final Financing Resolution includes Northern Campus Gary Donaldson, Chief Financial Officer April 21, 2020 60 Pu rp ose ➢ Seek Board Approval of bank financed transaction pursuant to NC Statute Section 160A-20 ➢ Capital One Bank will hold 2.7% interest rate through May 12, 2020 ➢ Financing secured by a Deed of Trust, with a security interest in various County buildings and land with a total collateral value estimated at $40 million ➢ 2020 Bank Financing will fund various County projects including: - Northern Campus: $29.07 Million - Schools Capital Improvements: $6.72 Million - Other County Projects: $3.63 Million - Solid Waste-Admin Building: $0.28 Million - Vehicle Replacements (7 Years): $0.79 Million -Total: $40.49 N4e -- ORANGE COUNTY NORTH CAROLINA 61 Northern Campus Renderings N Deter Von Center Northern Campuz Envir-onment and Agracukarai Center& Parks Operations Baee ORANGE COUNTY NORTH CAROLINA Com onent Estimated Cost 62 Final Projects to be Financed Facility,Accessibility,Safety and Security Projects212,634 Generator Projects 0 HVAC Projects230,218 Major Plumbing Repairs50,885 Northern Campus—Detention Center21,989,681 Northern Campus—EAC5,677,065 Northern Campus—Parks Operations1,404,810 581,503 Government Services (Link) Remediation Skill Development Relocation- Europa Center Upfits254,953 Roofing and Facade Projects686,167 Parks and Recreation Facility Renovations. Repairs,Safety Improvements246,500 Conservation Easements 259,514 River Park, Phase II118,509 ITGC Initiatives197,826 IT Infrastructure489,910 Communication Systems273,221 Solid Waste- Equipment and Vehicles717,228 Solid Waste-Administrative Building Remediation281,324 Sportsplex Capital Items- 2 Vans70,090 Schools- Recurring Capital Needs3,000,000 Schools- Improvements to Older Facilities472,941 Schoolewe liffilVarious Projects3,242,252 Total Project Costs40,490,231 COUNTYuKArqut NORTHA' • 63 Key Financing Terms ➢ Security Pledge- County collateral Government Services Annex, Government Services Link Center, District Attorney Building, Emergency Operations Center and the Northern Campus Collateral value totals $65 Million; and Subject to Annual Appropriations ➢ Payments made to the Trustee no lather than March 25 (for April 1 payment) and no later than September 25 (for October 1 payment) ➢ Maturity Term- 7- 20 Year maturities matches with the useful life of the assets ➢ Maximum Annual Debt Service not exceeding $3.6 Million (FY 2021-22) ➢ Source of Repayment- Property Tax, Solid Waste Fees and Sportsplex Fees ➢ Subordinate Lien and Pledge to General Obligation Bonds ORANGE COUNTY NORTH CAROLINA 64 Key Debt Model Metrics Debt Ratios 10-Year Payback Debt to Assessed Value IDS to GF Revenues 2020 65.17% 1.63% 13.26% 2021 64.61% 1.69% 14.33% 2022 62.52% 1.88% 16.75% 2023 62.33% 1.88% 16.49% 2024 64.14% 1.82% 16.66% 2025 65.88% 1.69% 15.79% 2026 68.11% 1.53% 15.07% Note: Includes the Spring 2020 Financing plus future 2021-2026 CIP projects as of April 3, 2020. ORANGE COUNTY NORTH CAROLINA 65 Debt Service Retirement and Additional Debt Capacity Existing and Proposed Tax Supported Debt Service 45.0 .2 40.0 — 35.0 ■- 30.0 25.0 - 20.0 - 15.0 - 10.0 - - - - - - - - - - -, ■ ■ ■ ■ ■ — 11 ■ e o � 0 C C10C) IDo0iDoCDIDCDC1OoI NC14 " " C%j • Existin g • 2020 Note: Additional Debt Capacity beginning FY 2025; with proposed GO Bond Referendum November 2024 ORANGE COUNTY NORTH CAROLINA 66 Questions/Comments ORANGE COUNTY NORTH CAROLINA