OTHER-2025-035-Orange County North Carolina limited obligation bonds series 2025

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insurance be maintained with respect to the Mortgaged Property . Such insurance may not, however, cover all perils to which the Mortgaged Property is subject . OUTSTANDING GENERAL OBLIGATION DEBT OF THE COUNTY The County has issued general obligation bonds and may issue general obligation bonds and notes in the future . The County will pledge its faith and credit and taxing power to the payment of its general obligation bonds and notes to be issued . See Appendix A, "THE COUNTY—DEBT INFORMATION" attached hereto . FUNDS WHICH MAY OTHERWISE BE AVAILABLE TO PAY BOND PAYMENTS OR ADDITIONAL PAYMENTS OR TO MAKE OTHER PAYMENTS TO BE MADE BY THE COUNTY UNDER THE TRUST AGREEMENT MAY BE SUBJECT TO SUCH FAITH AND CREDIT PLEDGE BY THE COUNTY AND THEREFORE MAY BE REQUIRED TO BE APPLIED TO THE PAYMENT OF ITS GENERAL OBLIGATION INDEBTEDNESS . ENVIRONMENTAL RISKS The site of the Whitted Building has been owned by the County since 1975 . The site of the Blackwood Farm Park has been owned by the County since 2001 . The site of the Orange County Library has been owned by the County since 2010 . Culbreth Middle School has been owned by the County since 2014 and has been operated as a public school in the County since 1969 . Orange Middle School has been owned by the County since 2023 and has been operated as a public school in the County since 1968 . New Hope Elementary School has been owned by the County since 2023 and has been operated as a public school in the County since 1991 . Pathways Elementary School has been owned by the County since 2023 and has been operated as a public school in the County since 2000 . Orange High School has been owned by the County since 2023 and has been operated as a public school in the County since 1963 . Ephesus Elementary School has been owned by the County since 2023 and has been operated as a public school in the County since 1972 . The County is not aware of any material environmental contamination on such sites . Undiscovered or future environmental contamination could have a material adverse effect on the value of the Mortgaged Property ; however, the County is required under the Trust Agreement to undertake whatever environmental remediation may be required by law. ADDITIONAL BONDS The County may execute and deliver Additional Bonds under the Trust Agreement that are secured by the Mortgaged Property, thereby diluting the relative value of the collateral with respect to the 2025 Bonds and the Prior Bonds . In addition, remedies under the Trust Agreement and the Modified Deed of Trust are controlled by the Majority Owners . Upon issuance of the 2025 Bonds, the Owners of the 2025 Bonds will own a majority of the Bonds . BANKRUPTCY Under current North Carolina law, a local governmental unit such as the County may not file for bankruptcy protection without ( 1 ) the consent of the LGC and (2) the satisfaction of the requirements of § 109(c) of the United States Bankruptcy Code . If the County were to initiate bankruptcy proceedings with the consent of the LGC and satisfy the requirements of 11 U . S . C . § 109(c), the bankruptcy proceedings could have material and adverse effects on holders of the 2025 Bonds , including (a) delay in enforcement of their remedies, (b) subordination of their claims to claims of those supplying goods and services to the County after the initiation of bankruptcy proceedings and to the administrative expenses of bankruptcy proceedings and (c) imposition without their consent of a plan of reorganization reducing or delaying 15