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MOODY'S ASSIGNS Aa2 TO CABARRUS COUNTY'S $11.9 MILLION REFUNDING CERTIFICATES OF PARTICIPATION, SERIES 2011 B; AND $22.7 MILLION REFUNDING CERTIFICATES OF PARTICIPATION SERIES 2011C AFFIRMS Aa1 RATING ON $119.8 MILLION OF GO DEBT OUTSTANDING Moody's Investors Service has assigned a Aa2 rating to Cabarrus County's (NC) $11.9 million Refunding Certificates of Participation (County of Cabarrus, North Carolina Installment Financing Contract), Series 2011 B and $22.7 milliont Series 2011C issued through the Cabarrus County Development Corporation. The Certificates of Participation (COPs) are secured by annual appropriations from Cabarrus County and by recourse to six school buildings. Proceeds will be used to refund the County's 2002 and 2003 Certificates of Participation. The refunding is expected to generate a net present value savings in excess of 4% with out extending debt maturity. 1 11 1 M The Aa2 rating is based on the satisfactory legal structure and essential nature of the pledged asset, as well as the long -term credit characteristics of the county. Concurrently, Moody's has affirmed the Aa1 rating on Cabarrus County's $119.8 million of outstanding general obligation debt and the Aa2 rating on $223 million of COPs. The rating reflects the county's solid financial position that has been bolstered by new management policies and a manageable debt burden. The rating further incorporates the county's taxbase, which we expect will remain challenged by the loss of its top taxpayer and a slowing economy, but will remain stable over the medium term given its proximity to the City of Charlotte (G.O. rated Aaa) as well as the presence of Lowe's Motor Speedway and the development of a research campus in the county. STRENGTHS: - Stable financial position - Favorable demographic profile. CHALLENGES: -Loss of major taxpayer. Attachment number 3 1 -1 Page 354