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July 21, 2003 Page 202
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<br />instructions regarding compliance with the requirements of the Code and any
<br />related regulations and procedures relating to the Bonds.
<br /> Section 14. There are hereby created appropriate funds and accounts of
<br />the Issuer for the receipt and expenditure of the proceeds of the Bonds and
<br />appropriate debt service funds and accounts of the Issuer for the receipt and
<br />disbursement of debt service payments on the Bonds.
<br /> Section 15. The Issuer hereby undertakes, for the benefit of the
<br />beneficial owners of the Bonds, to provide:
<br /> (a) by not later than seven months from the end of each fiscal year
<br />of the Issuer, commencing with the fiscal year ending June 30, 2003, to each
<br />nationally recognized municipal securities information repository ("NRMSIR")
<br />and to the state information depository for the State of North Carolina
<br />("SID"), if any, audited financial statements of the Issuer for such fiscal
<br />year, if available, prepared in accordance with Section 159-34 of the General
<br />Statutes of North Carolina, as it may be amended from time to time, or any
<br />successor statute, or, if such audited financial statements of the Issuer are
<br />not available by seven months from the end of such fiscal year, unaudited
<br />financial statements of the Issuer for such fiscal year to be replaced
<br />subsequently by audited financial statements of the Issuer to be delivered
<br />within 15 days after such audited financial statements become available for
<br />distribution;
<br /> (b) by not later than seven months from the end of each fiscal year
<br />of the Issuer, commencing with the fiscal year ending June 30, 2003, to each
<br />NRMSIR, and to the SID, if any, (i) the financial and statistical data as of
<br />a date not earlier than the end of the preceding fiscal year for the type of
<br />information included under heading "The County - Debt Information and - Tax
<br />Information" in the Official Statement relating to the Bonds and (ii) the
<br />combined budget of the Issuer for the current fiscal year, to the extent such
<br />items are not included in the financial statements referred to in (a) above;
<br /> (c) in a timely manner, to each NRMSIR or to the Municipal Securities
<br />Rulemaking Board ("MSRB"), and to the SID, if any, notice of any of the
<br />following events with respect to the Bonds, if material:
<br /> (1) principal and interest payment delinquencies;
<br /> (2) non-payment related defaults;
<br /> (3) unscheduled draws on debt service reserves reflecting financial
<br /> difficulties;
<br /> (4) unscheduled draws on any credit enhancements reflecting financial
<br /> difficulties;
<br /> (5) substitution of any credit or liquidity providers, or their
<br /> failure to perform;
<br /> (6) adverse tax opinions'or events affecting the tax-exempt status of
<br /> the Bonds;
<br /> (7) modification to the rights of the beneficial owners of the Bonds;
<br /> (8) call of any of the Bonds for redemption;
<br /> (9) defeasance of any of the Bonds;
<br /> (10) release, substitution or sale of any property securing repayment
<br /> of the Bonds; and
<br /> (11) rating changes; and
<br /> (d) in a timely manner, to each NRMSIR or to the MSRB, and to the
<br />SID, if any, notice of a failure of the Issuer to provide required annual
<br />financial information described in (a) or (b) above on or before the date
<br />specified.
<br /> If the Issuer fails to comply with the undertaking described above, any
<br />beneficial owner of the Bonds may take action to protect and enforce the
<br />rights of all beneficial owners with respect to such undertaking, including
<br />an action for specific performance; provided, however, that failure to comply
<br />with such undertaking shall not be an event of default and shall not result
<br />in any acceleration of payment of the Bonds. All actions shall be
<br />instituted, had and maintained in the manner provided in this paragraph for
<br />the benefit of all beneficial owners of the Bonds.
<br /> The Issuer reserves the right to modify from time to time the
<br />information to be provided to the extent necessary or appropriate in the
<br />judgment of the Issuer, provided that:
<br /> (a) any such modification may only be made in connection with a
<br /> change in circumstances that arises from a change in legal
<br /> requirements, change in law, or change in the identity, nature, or
<br /> status of the Issuer;
<br /> (b) the information to be provided, as modified, would have
<br /> complied with the requirements of Rule 15c2-12 issued under the
<br /> Securities Exchange Act of 1934 ("Rule 15c2-12") as of the date of the
<br /> Official Statement relating to the Bonds, after taking into account
<br /> any amendments or interpretations of Rule 15c2-12, as well as any
<br /> changes in circumstances; and
<br /> (c) any such modification does not materially impair the
<br /> interests of the beneficial owners, as determined either by parties
<br /> unaffiliated with the Issuer (such as bond counsel), or by the
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