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HomeMy WebLinkAboutAgenda - 06-23-2005-8bORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: June 23, 2005 Action Agenda Item No. ~-b SUBJECT: Public Hearing on the Issuance of Refunding Bonds, Adoption of Refunding Bond Orders and Adoption of Bond Sale Resolution DEPARTMENT: Finance PUBLIC HEARING: (Y/N) Yes ATTACHMENT(S): Bond Order far Adoption Notice of Adoption of Bond Order Resolution for Bond Order Publication Band Sale Resolution INFORMATION CONTACT: Ken Chavious, ext 2453 Durham 688-7331 Mebane 336-227-2031 TELEPHONE NUMBERS: Hillsborough 732-8181 Chapel Hill 968-4501 PURPOSE: To conduct the required public hearing on the advisability of issuing refunding bonds, and then, if the Board so desires, to adopt the appropriate Bond Order and resolutions to provide for the sale of refunding bands and a portion of the bonds approved at the County's 2001 bond referendum. BACKGROUND: On June 14, 2005, the Board introduced the attached bond order in consideration of pursuing the refunding of bonds issued by the Ccunty in April 2000. In addition, the Board established June 23, 2005 as the public hearing date to receive public comment on the advisability of the proposed refunding. The public hearing notice has been published as required and all other procedural steps have taken place in accordance with Local Government Commission (LGC) and statutory regulations. In order to proceed with the refunding process, the Board is required to take action to adopt and publish the Bond order. This action can only occur after public comment on the refunding proposal. In addition to the action mentioned above, the Board is asked to consider adoption of a resolution formally authorizing the August 16, 2005 sale of the 2001 referendum bonds and the 2000 refunding bonds mentioned above as required by the LGC. The sale of the 2001 voter approved bonds will include funds far schools, parks, affordable housing and senior centers, The amount will be determined at the June 20, 2005 work session on capital projects. The required resolution for adoption will be completed after the amounts are determined by the Board. The Bond Sale resolution accomplishes the following: Formally authorizes the sale of the 2001 bonds. Formally authorizes the sale of the refunding bonds. Formally pledges the County's taxing power to provide for the payments on the bonds. • Authorizes the Finance Director, in consultation with the LGC, to set the final payment schedule. • Authorizes the County Manager and Finance Director to prepare an appropriate form of Official Statement to provide relevant information to potential bond purchasers. • Makes the required continuing disclosure commitments. • Authorizes County staff to complete the process of issuing bonds. The resolution has been prepared by Bond Counsel in compliance with the requirements of the LGC. FINANCIAL IMPACT: There is no immediate fiscal impact, however, once the refunding is complete, the County would realize annual savings of approximately $109,000 in debt payments. Savings for the remaining term of the bonds would be in the neighborhood of $1,500,000. Estimated debt service payments on the 2001 bonds will be provided once the sale amount is determined. RECOMMENDATION(S): The Manager recommends that the Board conduct the Public Hearing, adopt the bond order, the resolution for band order publication and the resolution formally authorizing the sale of the 2001 bands and the refunding bonds. 3 Bond Order for Adoption -- Refunding Bonds BOND ORDER AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS IN THE MAXIMUM AMOUNT OF $35,000,000 _ WHEREAS -- Orange County, North Carolina (the "County"), has previously issued its general obligation Public Improvement Bonds, Series 2000A and 2000B (the "Prior Bonds"), Based on the current state of the municipal bond market, the County lzas determined that refinancing all or a portion of the outstanding balance of the Prior Bonds would provide savings to the County. The County has applied to the North Carolina Local Government Commission for its approval of the issuance of County refunding bonds to carry out the refinancing of the Prior Bonds, The LGC has accepted the County's application. BE IT ORDERED by the Board of Commissioners of Orange County, North Carolina, as follows: 1. There are hereby ordered to be issued general obligation refunding bonds of the County to provide for the refinancing of all or a portion of the outstanding balance of the Prior Bonds, including paying related financing costs and other necessary or incidental costs, 2. The maximum aggregate principal amount of the bonds issued for such purpose will be $35,000,000. 3. Taxes will be levied in an amount sufficient to pay the principal of and interest on the bonds so issued, 4. A sworn statement of debt prepared by the County's Finance Officer has been filed with the Clerk to this Board and is available for public inspection. 5. This Bond Order takes effect immediately. 92982v1 `~ OranEe County Refunding Bonds -- Notice of Adoption of Bond Order The Orange County Board of Commissioners has adopted the following bond order, providing for the issuance of refunding bands. Further information regarding the bonds and the bond order appears at the end of this notice. * * * ~ * ~ BOND ORDER AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS IN THE MAXIMUM AMOUNT OF $35,000,000 WHEREAS -- Orange County, North Carolina (the "County"), has previously issued its general obligation Public Improvement Bonds, Series 2000A and 2000B (the "Prior Bonds"). Based on the current state of the municipal bond market, the County has determined that refinancing all or a portion of the outstanding balance of the Prior Bonds would provide savings to the County. The County has applied to the North Carolina Local Government Commission for its approval of the issuance of County refunding bonds to carry out the refinancing of the Prior Bonds. The LGC has accepted the County's application, BE IT ORDERED by the Board of Commissioners of Orange County, North Carolina, as follows: 1. There are hereby ordered to be issued general obligation refunding bonds of the County to provide for the refinancing of all or a portion of the outstanding balance of the Prior Bonds, including paying related financing costs and other necessary or incidental costs. 2. The maximum aggregate principal amount of the bonds issued for such purpose will be $3.5,000,000. 3. Taxes will be levied in an amount sufficient to pay the principal of and interest on the bonds so issued. 92982v1 5 4. A sworn staternent of debt prepared by the County's Finance Officer has been filed with the Clerk to this Board and is available for public inspection. 5. This Bond Order takes effect immediately. ~ * ~ ~: The foregoing order was adopted by the Orange County Board of Commissioners on June 23, 2005, and is hereby published this day of 2005. Any action or proceeding questioning the validity of the order must be begun within 30 days after the date of publication of this notice. By order of the Board of Commissioners. Donna Baker Clerk, Board of Commissioners Orange County, North Carolina 92982v1 Resolution re~ardin~ publication of Bond Order WHEREAS, there has been adopted at this meeting a bond order entitled as follows: BOND ORDER AUTHORIZING THE ISSUANCE OF GENERAL OBLIGATION REFUNDING BONDS IN THE MAXIMUM AMOUNT OF $35,000,000 AND WHEREAS, the General Statutes require the publication of a notice to complete the process of authorizing the bonds; BE IT THEREFORE RESOLVED by the Board of Conunissioners of Orange County, North Carolina, that the Clerk to this Board is authorized and directed to publish a notice of the adopfion of such Barad Order, in the forrtx provided for in Section 159-58 of the General Statutes, one time in a newspaper having general circulation in the County, 92982v1 RESOLUTION FOR A BOND SALE WHEREAS: The voters of Orange County, North Carolina (the "County"), on November 6, 2001, approved the issuance of County general obligation bonds for various purposes, including schools, senior centers and parks, recreation and open space (the "Referendum Bonds"). In addition, on June 23, 2005, the County's Board of Commissioners (the "Board") authorized the issuance of up to $35,000,000 of County general obligation refunding bonds (the "Refunding Bonds"). Tlie Refunding Bonds do not require referendum approvah The Referendum Bonds and the Refunding Bonds will be referred to collectively in this resolution as the "Bonds". The Board has determined that the County should now issue the Refunding Bonds and a portion of the Referendum Bonds, BE IT THEREFORE RESOLVED by the Board of Commissioners of Orange County, North Carolina, as follows: 1. Determination To Sell Referendum Bonds -The County will issue and sell Referendum Bonds for their authorized purposes, as follows: tTp to $ of the $3,500,000 authorized and unissued bonds for senior centers; Up to $ of the $5,500,00 authorized and unissued bonds for parks, recreation and open space; and As much as all of the $2.5,685,000 authorized and unissued school bonds. These bonds will be sold as a single issue of bonds to be designated "General Obligation [Public Improvement] Bonds, Series 200.5." 2. Determination To Sell Refiaadiug Bonds -- The County will also issue and sell the Refunding Bonds for their authorized purpose. The Refunding Bonds will be designated "General Obligation Refunding Bonds, Series 2005." The Refunding Bonds may be sold as a separate issue but simultaneously with the Referendum Bonds or may be combined for sale as a single issue with the Referendum Bonds, as the County's Finance Officer may determine in consultation with the North Carolina Local Government Commission (the "LGC"). If all the Bonds are combined for sale as a single issue, they shall carry such series designation as the Finance Officer may deternune, 3. Prryn:e~:t Provisioizs -- The principal of the Bonds will be payable on such dates and in such years and amounts as the Finance Officer determines after consultation with the LCC, except that the final maturity for the Bonds must not extend beyond December 31, 2030, Each Bond will bear interest at such rate as is determined at the time of its sale. Interest on each Bond will be payable semiannually (a) from September 1, 2005, if it is authenticated prior to the first interest payment date, or (b) otherwise from the interest payment date, that is, or immediately precedes, the date on which it is authenticated (unless payment of interest thereon is in default, in which case such Bonds will bear interest from the date to which interest has been paid), Principal, premium, if any, and interest will be payable in lawful money of the United States of America, `~ It is the Board's intention that the County should issue the maximum amount of bonds referred to in Section 1 above, and as many of the Refunding Bonds as are necessary and appropriate to carry out the planned refunding. The Finance Officer, however, in consultation with the County Manager and the LGC, may approve the issuance of lesser (but not greater) amounts of Referendum Bonds for any of the stated purposes. The Finance Officer is also authorized and directed to determine the final aggregate principal amount of Refunding Bonds to be issued, up to the $35,000,000 authorized maximum. The Finance Officer will execute a certificate prior to the initial delivery of the Bonds designating the final principal amount of bonds to be issued for each purpose, the principal payment schedule for the Bonds and the principal and interest payment dates for the Bonds. This certificate will be conclusive evidence of the Finance Officer's approval and determination of such matters. 4. Pledge of Faitl:, Credit a~:d Taxii:g Power -- The County's full faith and credit are hereby irrevocably pledged for the payment of the principal of and interest on the Bonds. Unless other funds are lawfully available and appropriated for timely payment of the Bonds, the County will levy and collect an annual ad valorem tax, without restriction as to rate or amount, on all locally taxable property in the County sufficient to pay the principal of and interest on the Bonds as the same become due. 5. Approval of Official Statement for Offering - the Bonds will be offered for sale pursuant to an official statement (the "Official Statement") relating to the Bonds in such form as the Finance Officer and County Manager, in consultation with the LGC, may deternine. This Official Statement shall be in a form substantially similar to the form of such documents as previously used by the County for prior sales of general obligation bonds. The Official Statement must have all appropriate updating of infornration and such other changes as may be necessary or appropriate to provide for such Official Statement to be accurate and complete in all material respects given its intended use in the marketing of the County's bonds. The Board acknowledges that it is the County's responsibility to ensure that the Official Statement, ili its final form, neither contains an untrue statement of a material fact nor omits to state a material fact required to be included therein for the purpose for which such Official Statement is to be used or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, By the adoption of this resolution, the Board members aclrnowledge and accept their responsibility for causing the County to fulfill these responsibilities for the Official Statement. /0 6. Redemption Provisions -~- The Bonds will be subject to redemption prior to maturity upon such terms and conditions as the Finance Officer, in consultation with the LGC, may determine. The Finance Officer must execute a certificate prior to the initial delivery of the Bonds designating redemption terms and conditions, and such certificate will be conclusive evidence of the Finance Officer's approval and determination of such ternrs and conditions. The County will give notice of redemption by certified or registered mail to the registered owners of the Bonds, The County will mail such notice not more than 60 days and not less than 30 days prior to the date fixed for redemption, 7. Forn: of Borrds -- The Bonds will be in substantially the form set out in Exhibit A. The Bonds will be dated September 1, 2005, will be in fully registered form, in denominations of $5,000 and integral multiples thereof, and will be numbered R-1 upward separately within each series or consecutively across the series, as the Finance Officer may determine, The Bonds must be signed by the manual or facsimile signature of the Board's Chair, must be countersigned by the manual or facsimile signature of the Board's Clerk or any Assistant Clerk, and the County's seal must be affixed thereto or a facsimile thereof printed thereon, No Bond will be valid unless at least one of the signatures appearing on such Bond (which may be the signature of the LGC's representative required by law) is manually applied or until such Bond has been authenticated by the manual signature of an authorized officer or employee of a bond registrar selected by the County. 8. Finance Officer as Registrar; Payments to Registered Owners -- The Finance Officer is appointed Registrar for the Bonds. As Registrar, the Finance Officer will maintain appropriate books and records of the ownership of the Bonds, The County will treat the registered owner of each Bond as the person exclusively entitled to payment of principal, premium, if any, and interest and the exercise of all rights and powers of the owner, except that interest payments will be made to the person shown as owner on the registration books on the 15th day of the month preceding each interest payment date. 9. Advertising Bonds for Sale -- The Finance Officer, in collaboration with the LGC, is authorized and directed to take all proper steps to advertise the Bonds in accordance with customary LGC procedures, including through the use of a "Notice of Sale" document in the LGC's customary form, The Finance Officer is authorized and directed to review and approve a form of Notice of Sale as such officer may determine to be in the County's best interest. 10. LGC To Sell Bo~ads -The County asks the LGC to sell the Bonds, to receive and evaluate bids and to award the Bonds on the basis of the best bid received. IL Completir:g Official Statement after Sale -- After bids have been received and the LGC has awarded the Bonds to the successful purchaser, the Finance Officer is authorized and directed to prepare, in collaboration with the LGC, a final Official Statement containing, among such other matters as may be appropriate, information required pursuant to Rule ISc2-12 ("Rule 15c2-12") promulgated by the United States Securities and Exchange Commission under the United States Securities Act of 1934, as amended. The County, together with the LGC, will arrange for the delivery within seven business days of the date the Bonds are sold of a reasonable number of copies of the final Official Statement to the successful bidder on the Bonds for delivery to each potential investor requesting a copy of the final Official Statement and to each person to whom such bidder and members of the bidding group initially sell the Bonds, 12. Finance Officer To Complete Bond Closing -After the sale of the Bonds, the Finance Officer and all other County officers and employees are authorized and directed to take all proper steps to have the Bonds prepared and executed in accordance with their terms and to deliver the Bonds to the purchaser upon payment for the Bonds, The Finance Officer is authorized and directed to hold the executed Bonds, and any other documents authorized or perrrritted by this resolution, in escrow on the County's behalf until the conditions for the delivery of the Bonds and other documents have been completed to the Finance Officer's satisfaction, and thereupon to release the executed Bonds and other documents for delivery to the appropriate persons or organizations. Without limiting the generality of the foregoing, this authorization and direction is specifically extended to authorize the Finance Officer (a) to enter into such agreements or take such other actions as such officer may deem appropriate in connection with obtaining bond insurance for the Bonds and providing for the refunding contemplated by this resolution (such as giving notice of redemption and executing an escrow agreement with an escrow agent), and (b) to approve changes to any documents or closing certifications previously signed by County officers or employees, provided that the Bonds will be in substantially the form approved by this resolution and that any such changes will not substantially alter the intent of such certificates from that expressed in the forms of such certificates as executed by such officers or employees, The Finance Officer's authorization of the release of any such document for delivery will constitute conclusive evidence of such officer's approval of any such changes. i~ l3. Undertakizzg for Continuing Disclosure -- The County undertakes, for the benefit of the beneficial owners of the Bonds, to provide continuing disclosure with respect to the Bonds as described in Exhibit B. The Board designates the Finance Officer as the County officer to be primarily responsible for the County's compliance with its undertakings for continuing disclosure provided for in this resolution. The Finance Officer will provide for the filings and reports (including the reports of material events) constituting the continuing disclosure provided for in this resolution. 14. Resolutions As To Tax Matters -- The County will not take or omit to take any action the taking or omission of which will cause the Bonds to be "arbitrage bonds," within the meaning of Section 148 of the "Code" (as defined below), or "private activity bonds" within the meaning of Code Section 141, or otherwise cause interest on the Bonds to be includable in gross income for federal income tax purposes. Without limiting the generality of the foregoing, the County will comply with any Code provision that Wray require the County at any time to pay to the United States any part of the earnings derived from the investment of the proceeds of the Bonds, and the County will pay arry such required rebate from its general funds, For this paragraph, "Code" means the United States Internal Revenue Code of 1986, as amended, including applicable Treasury regulations. 1 S. Book-Entry System for Boz:d Registration: -- The Bonds will be issued by means of a book-entry system, with one bond certificate for each maturity immobilized at The Depository Trust Company, New York, New York ("DTC"), and not available for distribution to the public. The book-entry system for registration will operate as described in the Official Statement, Therefore, (a) the County will pay principal, premium, if any, and interest on the Bonds to DTC or its nominee as registered owner of the Bonds, (b) the County will not be responsible or liable for such transfer of payments to parties other than DTC or for maintaining, supervising or reviewing the records maintained by DTC or any other person related to the Bonds, and (c) the County will not mail redemption notices (or any other notices related to the Bonds) to anyone other than DTC or its nominee so long as the book-enh~y system of registration with DTC is in effect, The County may elect to discontinue the book-entry system with DTC. The Finance Officer is authorized and directed to enter into any agreements such officer deems appropriate to put into place the book-entry system with DTC. 16. Approval of Financial Advisor- The Board confirms the selection of Ferris, Baker Watts, Inc. to serve as the County's financial advisor with respect to the refunding component of the bond issue, I3 17. Call of Prior Bonds for Redemption -The Board authorizes and directs the Finance Officer to make, on the County's behalf, an irrevocable call for redemption of such of the County's general obligation Public Improvement Bonds, Series 2000A and 2000B, as the Finance Officer (after consultation with the LCC) deems beneficial to the County. The Finance Officer will make this call for redemption by the execution and delivery of an appropriate certificate in connection with the original delivery of the Refunding Bonds, I8. Misce[lar:eous Provisions -- All County officers and employees are authorized and directed to take all such further action as they may consider necessary or desirable in connection with the furtherance of the purposes of this resolution. All such prior actions of County officers and employees are ratified, approved and confirmed. Upon the absence, unavailability or refusal to cat of the Chair or the Finance Officer, the County Manager may assume any responsibility or carry out any function assigned to the Chair or the Finance Officer in this resolution All other resolutions, or parts thereof, in conflict with this resolution are repealed, to the extent of the conflict. This resolution takes effect inunediately. /~l EXHIBIT A -Form of Bonds REGISTERED REGISTERED Number R-X UNITED STATES OF AMERICA STATE OF NORTH CAROLINA ORANGE COUNTY General Obligation (Public Improvement) Bond, Series 2005 INTEREST RATE MATURITY DATE DATED DATE CUSIP June 1, September 1, 2005 684 609 XXX REGISTERED OWNER: *****CEDE & CO.***** PRINCIPAL AMOUNT: **** THOUSAND DOLLARS ($ ,000)*** ORANGE COUNTY, NORTH CAROLINA (t/ie "County"), for value received, promises to pay to the registered owner hereof, or registered assigns or legal representative, the principal amount stated above on the maturity date stated above, subject to prior redemption as described herein, and to pay interest on this Bond semiannually on each 1 and 1, beginning , at the annual rate stated above. Interest is payable (a) from September 1, 2005, if this Bond is authenticated prior to , or (b) otherwise from the 1 or 1 that is, or immediately precedes, the date on which this Bond is authenticated (unless payment of interest hereon is in default, in which case this Bond will bear interest from the date to which interest has been paid). Principal, premium, if any, and interest are payable in lawful money of the United States of America. This Bond is one of an issue of the County's [$_] General Obligation [Public Improvement] Bonds, Series 200.5 (the "Bonds"), of like date and tenor, except as to number, denomination, rate of interest, privilege of redemption and maturity. The Bonds are issued pursuant to a resolution adopted by such Board on June 23, 200.5, and the Constitution and laws of the State of North Carolina, including the Local Government Bond Act. /5 The County's full faith and credit are pledged for the payment of principal of and interest on this Bond. The Bonds are issued by means of a book-entry system, with one bond certificate for each maturity immobilized at The Depository Trust Company, New Yorlc, New York ("DTC"), and not available for distribution to the public. Transfer of beneficial ownership interests in the Bonds in the principal amount of $5,000 or any integral multiple thereof will be effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. Principal, premium, if any, and interest on the Bonds are payable by the County to DTC or its nominee as registered owner of the Bonds. The County is not responsible or liable for such transfer of ownership or payments or for maintaining, supervising or reviewing the records maintained by DTC, its participants or persons acting through such participants. [Bonds maturing prior to 1, 2015, are not subject to redemption prior to maturity. Bonds maturing on 1, 2015, and thereafter are redeemable, at the County's option, from any moneys that may be made available for such purpose, irr whole on any date not earlier than 1, 2014, at a redemption price equal to 100% of the principal amount to be redeemed, plus interest accrued to the redemption date, without premium.] If less than all of the Bonds stated to mature on different dates are called for redemption, the Bonds to be redeemed will be selected in such manner as the County may determine. If less than all of the Bonds of any one maturity are called for redemption, the particular Bonds or portions of Bonds of such maturity to be redeemed will be selected by lot in such manner as the County in its discretion may determine; provided, however, that the portion of each Bond to be redeemed will be in the principal amount of $5,000 or some integral multiple thereof, and that, in selecting Bonds for redemption, each Bond will be considered as representing that number of Bonds which is obtained by dividing the principal amount of such Bond by $5,000. Notwithstanding the foregoing, so long as a book-entry system with DTC is used for determining beneficial ownership of Bonds, if less than all of the Bonds within a maturity are to be redeemed, DTC and its participants will determine which of the Bonds within any such maturity are to be redeemed. If a portion of a Bond is called for redemption, a new Bond in principal amount equal to the unredeemed portion thereof will be issued to the registered owner upon the surrender thereof. The County will give notice of redemption by certified or registered mail to DTC or its nominee as the registered owner of the Bonds. The County will mail such notice not more than 60 days and not less than 30 days prior to the date fixed 16 for redemption. The County is not responsible for sending notices of redemption to anyone other than DTC or its nominee. If (a) DTC determines not to continue to act as securities depository for the Bonds or (b) the County so elects, the County will discontinue the book-entry system with DTC, If the County fails to identify another qualified securities depository to replace DTC, the County will deliver replacement Bonds in the form of fully-registered certificates. The County Finance Officer has been appointed Registrar for the Bonds. As Registrar, the Finance Officer will maintain appropriate books and records indicating ownership of the Bonds, The County will treat the registered owner of this Bond as the person exclusively entitled to payment of principal, premium, if any, and interest and the exercise of all other rights and powers of the owner, except that interest payments will be made to the person shown as owner on the County's registration books on the 15th day of the month preceding each interest payment date, The Bonds are issued with the intent that North Carolina law will govern their terms. All acts, conditions and things required by the Constitution and laws of the State of North Carolina to happen, exist or be performed precedent to and in the issuance of this Bond have happened, exist and have been performed, and the issue of Bonds of which this Bond is one, together with all other indebtedness of the County, is within every debt and other limit prescribed by the Constitution and laws of the State of North Carolina. i7 IN WITNESS WHEREOF, Orange County, North Carolina, has caused this Bond to signed by the Chair of its Board of Commissioners, to be countersigned by the Clerk to such Board, its seal to be affixed hereto and this Bond to be dated September 1, 2005. COUNTERSIGNED: (SEAL [Sample only - do not siQn1 Sample only - do tot si~nl Clerk, Board of Commissioners Orange County, North Carolina Chair, Board of Corrurussioners Orange County, North Carolina The Bonds have been approved by the North Carolina Local Government Commission in accordance with the Local Government Bond Act, [Sample only - do not si~n~ Janice T. Burke Secretary, Local Government Commission ASSIGNMI';NT l~ FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and transfer(s) unto (Please print or type transferee's name and address, including zip code) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OR TRANSFEREE: the within bond and all rights thereunder, hereby irrevocably constituting and appointing , Attorney, to transfer said bond on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed: NOTICE: Signature(s) must be guaranteed by a participant in the Securities Transfer Agent Medallion Program ("STAMP") or similar program (Signature of Registered Owner) NOTICE: The signature above must correspond with the name of the registered owner as it appears on the front of this bond in every particular without alteration or enlargement or any change whatsoever. Exhibit B -- Undertaldn~ for Continuing Disclosure ~ The County undertakes, for the benefit of the beneficial owners of the Bonds, to provide the following: (a) by not later than seven months from the end of each of the County's fiscal years, to each nationally recognized municipal securities information repository ("NRMSIR"), and the state information depository for the State of North Carolina ("SID"), if any, audited County financial statements for such fiscal year, if available, prepared in accordance with Section 159-34 of the General Statutes of North Carolina, as it may be amended from time to time, or any successor statute, or, if such audited financial statements are not available by seven months from the end of any fiscal year, unaudited County financial statements for such fiscal year, to be replaced subsequently by audited County financial statements to be delivered within 15 days after such audited financial statements become available for distribution; (b) by not later than seven months from the end of each of the County's fiscal years, to each NRMSIR, and to the SID, if any, (I) the financial and statistical data as of a date not earlier than the end of the preceding fiscal year (which data will be prepared at least annually, will specify the date as to which such information was prepared and will be delivered with any subsequent material events notices specified in subparagraph (c) below) for the type of information included under heading "The County -Debt Information" and "- Tax Information" in the final Official Statement (excluding any information on overlapping or underlying units), and (ii) the combined budget of the County for the current fiscal year, to the extent such items are not included in the audited financial statements referred to in (a) above; (c) in a timely manner, to each NRMSIR or to the Municipal Securities Rulemaking Board ("MSRB"), and to the SID, if any, notice of any of the following events with respect to the Bonds, if material: (1) principal and interest payment delinquencies; (2) non-payment related defaults; (3) unscheduled draws on debt service reserves reflecting financial difficulties; (4) unscheduled draws on any credit enhancements reflecting financial difficulties; a~ (5) substitution of credit or liquidity providers, or their failure to perfornr; (6) adverse tax opinions or events affecting the tax-exempt status of the Bonds; (7) modifications to rights of the beneficial owners of the Bonds; (8) Bond calls; (9) defeasances; (10) release, substitution or sale of any property securing repayment of the Bonds; and (11) rating changes; and (d) in a timely manner, to each NRMSIR or to the MSRB, and to the SID, if any, notice of a failure of the County to provide required annual financial information described in (a) or (b) above on or before the date specified. If the County fails to comply with the undertaking described above, any beneficial owner of the Bonds may take action to protect and enforce the rights of all beneficial owners with respect to such undertaking, including an action for specific performance; provided, however, that failure to comply with such undertaking will not be an event of default and will not result in any acceleration of payment of the Bonds. All actions will be instituted, had and maintained in the manner provided in this paragraph for the benefit of all beneficial owners of the Bonds. The County, at its option, may make any filing required by this undertaking solely by transmitting such filing to the Texas Municipal Advisory Council (the "MAC") as provided at http://www.disclosureusa.org, unless the SEC has withdrawn the interpretive advice in its letter to the MAC dated September 7, 2004. The County reserves the right to modify from time to time the information to be provided to the extent necessary or appropriate in the County's .judgment, provided that: (a) any such modification may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of the County; ai (b) the information to be provided, as modified, would have complied with the requirements of Rule 1Sc2-12 as of the date of the final Official Statement, after taking into account any amendments or interpretations of Rule 1.Sc2-12, as well as any changes in circumstances; and (c) any such modification does not materially impair the interests of the beneficial owners, as determined either by parties unaffiliated with the County or by the approving vote of the registered owners of a majority in principal amount of the Borrds pursuant to the terms of the bond resolution, as it may be amended from time to time, at the time of the amendment. Any annual financial information containing modified operating data or financial information will explain, in narrative form, the reasons for the modification and the impact of the change in the type of operating data or financial information being provided.