smithville township, north carolina

NEW ISSUE—Book-Entry Only Ratings:Moody’s “A1”

S&P “AA”(See “Ratings” herein)

This Official Statement has been prepared by the Local Government Commission of North Carolina and Smithville Township, North Carolina to provide information in connection with the sale and issuance of the 2012 Bonds described herein. Selected information is presented on this cover page for the convenience of the user. To make an informed decision regarding the 2012 Bonds, a prospective investor should read this Official Statement in its entirety. Unless indicated, capitalized terms used on this cover page have the meanings given in this Official Statement.

$8,220,000SMITHVILLE TOWNSHIP, NORTH CAROLINALimited Tax Hospital Refunding Bonds, Series 2012

Dated: Date of Delivery Due: As shown on inside cover page

Tax Treatment In the opinion of Parker Poe Adams & Bernstein LLP, Bond Counsel, under existing law, (1) interest on the 2012 Bonds (a) is excludable from gross income for federal income tax purposes, and (b) is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, and (2) interest on the 2012 Bonds is exempt from State of North Carolina income taxation. See “TAX TREATMENT” herein.

Redemption The 2012 Bonds are not subject to optional redemption, but are subject to mandatory sinking fund redemption as set forth herein.

Security The 2012 Bonds constitute limited tax obligations of the Township, payable solely from a special limited ad valorem tax levied upon the assessed property located within the Township and limited to a rate of four cents per one hundred dollars assessed valuation.

Interest Payment Dates June 1 and December 1, commencing June 1, 2012.

Denominations $5,000 or any integral multiple thereof.

Expected Closing/Settlement on or about April 12, 2012.

Bond Counsel Parker Poe Adams & Bernstein LLP, Raleigh, North Carolina.

Underwriter’s Counsel McGuireWoods LLP, Charlotte, North Carolina.

Baird

The date of this Official Statement is March 30, 2012.

MATURITY SCHEDULE

$8,220,000 Limited Tax Hospital Refunding Bonds, Series 2012

$4,745,000 Serial 2012 Bonds

Due June 1 of the Year Indicated

Year Amount Rate Yield Year Amount Rate Yield 2014 $600,000 3.00% 0.76% 2017 $575,000 4.00% 1.48% 2015 625,000 3.00 1.04 2018 700,000 4.00 1.80 2016 645,000 4.00 1.29 2019 735,000 4.00 2.06 2017 100,000 2.375 1.48 2020 765,000 4.00 2.33

$1,650,000 5.00% Term 2012 Bonds due June 1, 2022 Yield 2.70%

$1,825,000 5.00% Term 2012 Bonds due June 1, 2024 Yield 3.00%

SMITHVILLE TOWNSHIP, NORTH CAROLINA

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BOARD OF COMMISSIONERS OF THE COUNTY OF BRUNSWICK, NORTH CAROLINA, acting as the governing body of the Township

William M. Sue ............................................................................................................................... Chairman

J. Phillip Norris ...................................................................................................................... Vice-Chairman

John Martin (Marty) Cooke, Jr.

Charles Warren

Scott Phillips

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J. ARTHUR DOSHER MEMORIAL HOSPITAL

Board of Trustees

Sherri Marshall ........................................................................................................................... Chairperson

Dr. Robert Zukoski ............................................................................................................. Vice-Chairperson

Don Hughes ..................................................................................................................................... Secretary

Joe Agovino

Debbie Barnes

James Woody

Karen Taylor

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Bond Counsel

Parker Poe Adams & Bernstein LLP Raleigh, North Carolina

TABLE OF CONTENTS

Page

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INTRODUCTION ....................................................................................................................................... 1 THE LOCAL GOVERNMENT COMMISSION OF NORTH CAROLINA .............................................. 1 THE 2012 BONDS ...................................................................................................................................... 2

Redemption Provisions ................................................................................................................... 2 Authorization and Purpose .............................................................................................................. 3 Source of Payment for the 2012 Bonds .......................................................................................... 3

PROFESSIONALS ...................................................................................................................................... 4 THE PLAN OF REFUNDING .................................................................................................................... 4 ESTIMATED SOURCES AND USES OF FUNDS ................................................................................... 5 THE TOWNSHIP ........................................................................................................................................ 5

Government .................................................................................................................................... 5 Hospital Facilities ........................................................................................................................... 5 Geographic and Demographic Characteristics ................................................................................ 6 Commerce and Industry .................................................................................................................. 6 Debt Information ............................................................................................................................. 7 Tax Information .............................................................................................................................. 8

THE COUNTY ............................................................................................................................................ 9 Geographic and Demographic Characteristics ................................................................................ 9 Commerce and Industry ................................................................................................................ 10 Employment .................................................................................................................................. 11 County Tax Information ............................................................................................................... 12 Financial Information of the County ............................................................................................. 13

CONTINUING DISCLOSURE ................................................................................................................. 14 APPROVAL OF LEGAL PROCEEDINGS .............................................................................................. 16 RATINGS .................................................................................................................................................. 16 TAX TREATMENT .................................................................................................................................. 16

General ......................................................................................................................................... 16 Original Issue Premium ................................................................................................................ 18

UNDERWRITING .................................................................................................................................... 18 MISCELLANEOUS .................................................................................................................................. 19 APPENDIX A — The North Carolina Local Government Commission APPENDIX B — Financial Statements for Brunswick County for Fiscal Year Ended June 30, 2011 APPENDIX C — Proposed Form of Bond Counsel Opinion APPENDIX D — Book-Entry Only System

STATE OF NORTH CAROLINA

DEPARTMENT OF STATE TREASURER

JANET D. COWELL TREASURER

State and Local Government Finance Division and the Local Government Commission

T. VANCE HOLLOMAN DEPUTY TREASURER

INTRODUCTION

This Official Statement, including the cover page and the appendices hereto, is intended to furnish information in connection with the issuance of $8,220,000 Limited Tax Hospital Refunding Bonds, Series 2012 (the "2012 Bonds") of Smithville Township, North Carolina (the "Township").

The Township is one of six townships located within Brunswick County, North Carolina (the "County"). The Township exists solely as a taxing district and performs no governmental functions aside from the administration of a public hospital, the J. Arthur Dosher Memorial Hospital (the "Hospital"), through a board of trustees (the "Board of Trustees") composed of residents of the Township elected at large by the eligible voters of the Township. For further information concerning the Board of Trustees and the government of the Township, see "THE TOWNSHIP — GOVERNMENT."

The information furnished herein includes certain information concerning the Township. Because the Township's territory is located entirely within the County, certain of the functions of the Township and the County are interrelated and certain data regarding the Township are not available, some information concerning the County is also provided. Officials of the County have assisted the Local Government Commission in gathering and assembling the information contained herein.

This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy any securities other than the 2012 Bonds offered hereby, nor shall there be any offer or solicitation of such offer or sale of the 2012 Bonds in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. Neither the delivery of this Official Statement nor the sale of any of the 2012 Bonds implies that the information herein is correct as of any date subsequent to the date hereof. The information contained herein is subject to change after the date of this Official Statement, and this Official Statement speaks only as of its date.

The Underwriter has provided the following sentence for inclusion in this Official Statement. The Underwriter has reviewed the information in this Official Statement in accordance with, and as a part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

THE LOCAL GOVERNMENT COMMISSION OF NORTH CAROLINA

The Local Government Commission of North Carolina (the "Commission"), a division of the Department of State Treasurer, State of North Carolina (the "State"), is a State agency that supervises the issuance of the bonded indebtedness of all units of local government and assists these units in the area of fiscal management. Appendix A to this Official Statement contains additional information concerning the Commission and its functions.

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THE 2012 BONDS

The 2012 Bonds will be dated their date of issuance and will bear interest from their date at the interest rates set forth on the inside front cover page. Interest on the 2012 Bonds will be payable semiannually on each June 1 and December 1, commencing June 1, 2012. The 2012 Bonds will mature, subject to the redemption provisions set forth below, on the date set forth on the inside cover page of this Official Statement.

The issuance of the 2003 Bonds and the contracting of the indebtedness evidenced thereby was approved by a majority of the qualified voters of the Township voting at an election held in the Township. The 2012 Bonds are limited obligations of the Township issued in accordance with the Registered Public Obligations Act, Chapter 159E of the General Statutes of North Carolina, and pursuant to Chapter 131E, Article 2, Part 2 of the General Statutes of North Carolina, as amended, and the Local Government Bond Act of North Carolina, a bond order adopted by the Board of Commissioners of the County acting as the governing board of the Township, and a resolution adopted by that board providing for the issuance of the 2012 Bonds.

THE 2012 BONDS ARE PAYABLE SOLELY FROM A LIMITED SPECIAL AD VALOREM TAX (See "THE 2012 BONDS - SOURCE OF PAYMENT FOR THE 2012 BONDS"). Other than the 2003 Bonds (see "THE PLAN OF REFUNDING"), the Township presently has no other debt payable from the limited special ad valorem tax.

The 2012 Bonds will be issuable as fully registered bonds in a book-entry only system under which The Depository Trust Company ("DTC") will act as securities depository nominee for the 2012 Bonds. Purchases and transfers of the 2012 Bonds may be made only in authorized denominations of $5,000 or integral multiples thereof and in accordance with the practices and procedures of DTC. See Appendix D hereto for a description of the book-entry only system and DTC.

REDEMPTION PROVISIONS

Optional Redemption. The 2012 Bonds are not subject to optional redemption before maturity.

Mandatory Sinking Fund Redemption. The 2012 Bonds maturing on June 1, 2022 in the principal amount of $1,650,000 are subject to mandatory sinking fund redemption prior to maturity in part at a redemption price equal to the principal amount to be redeemed plus accrued interest, if any, to the Redemption Date, without premium, on June 1 in the years and amounts as follows:

YEAR AMOUNT 2021 $805,000 2022* 845,000

*Maturity

The 2012 Bonds maturing on June 1, 2024 in the principal amount of $1,825,000 are subject to mandatory sinking fund redemption prior to maturity in part at a redemption price equal to the principal amount to be redeemed plus accrued interest, if any, to the Redemption Date, without premium, on June 1 in the years and amounts as follows:

YEAR AMOUNT 2023 $890,000 2024* 935,000

*Maturity

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DTC and its participants will determine which 2012 Bonds within a maturity are to be redeemed by lot; provided, however, that the portion of any 2012 Bond to be redeemed must be in the principal amount of $5,000 or integral multiples thereof and that, in selecting 2012 Bonds for redemption, each 2012 Bond is to be considered as representing that number of 2012 Bonds which is obtained by dividing the principal amount of such 2012 Bond by $5,000.

Notice of redemption is to be given not less than 30 days nor more than 60 days before the redemption date in writing to DTC or its nominee as the registered owner of such 2012 Bonds, by prepaid certified or registered United States mail, at the address provided to the Township by DTC, but any failure or defect in respect of such mailing will not affect the validity of the redemption. If DTC is not the registered owner of such 2012 Bonds, the Township will give notice at the time set forth above by prepaid first class United States mail, to the then-registered owners of such 2012 Bonds or portions thereof to be redeemed at the last address shown on the registration books kept by the Township. The Township will also mail or transmit by facsimile a copy of the notice of redemption within the time set forth above (1) to the LGC and (2) to the Municipal Securities Rule Making Board (the "MSRB") in an electronic format as prescribed by the MSRB.

AUTHORIZATION AND PURPOSE

The 2012 Bonds are being issued in accordance with the Registered Public Obligations Act, Chapter 159E of the General Statutes of North Carolina, and pursuant to Chapter 131E, Article 2, Part 2 of the General Statutes of North Carolina, as amended and the Local Government Bond Act of North Carolina, a bond order adopted by the Board of Commissioners of the County, acting as the governing board of the Township, and a resolution adopted by that board providing for the issuance of the 2012 Bonds.

The 2012 Bonds are being issued for the purpose of (1) refunding the Township's Limited Tax Hospital Bonds, Series 2003 (the "2003 Bonds") maturing on and after June 1, 2014 (the "Refunded 2003 Bonds," and (2) paying the costs of issuing the 2012 Bonds. After the refunding of the Refunded 2003 Bonds, there will be $1,135,000 principal amount of 2003 Bonds outstanding.

The 2003 Bonds were issued to finance, with any other available funds, the costs of improving the Hospital.

SOURCE OF PAYMENT FOR THE 2012 BONDS

The 2012 Bonds are payable solely from a special limited ad valorem tax levied upon the assessed property located within the Township and limited to a rate of four cents per one hundred dollars assessed valuation. The remaining outstanding 2003 Bonds are the only other obligation payable from such special ad valorem tax. The tax revenues are to be applied in each fiscal year first to the payment of the principal of and interest on the 2003 Bonds and 2012 Bonds. To the extent that tax monies in each fiscal year are not required for debt service, the excess tax revenues may be applied to the payment of the costs of maintaining and improving a public hospital for the Township.

By contractual agreement with the Board of Trustees, the County levies and collects the limited ad valorem tax for an annual fee equal to 1.5% of the amount of tax revenues collected in any year. In the past, the Board of Trustees has paid this fee from tax revenues collected.

The Board of Commissioners for the County has the authority to alter the boundaries of the Township, which could affect the amount of property assessed for the limited ad valorem tax. Such changes could be approved by the Board of Commissioners of the County without any further action of the residents of the Township.

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Currently the limited ad valorem tax levied against the assessed value of the property in the Township is four cents per one hundred dollars, which is the maximum rate permitted for the special ad valorem tax. The Board of Commissioners of the County has the authority to reduce the levy without any further action of the residents of the Township. From July 1, 1989 to June 30, 2008, the special ad valorem tax was levied at the rate of 4 cents per one hundred dollars of assessed value. From July 1, 2008 to June 30, 2011, the special ad valorem tax was levied at a rate of 2.25 cents per one hundred dollars of assessed value. Effective July 1, 2011, the Board of Commissioners of the County raised the levy to four cents per one hundred dollars of assessed value for the Fiscal Year ending June 30, 2012.

In addition to the risks posed by the potential changes discussed in the paragraphs above, other risks associated with the 2012 Bonds include a decrease in the amount of tax revenues collected due to a reduction in the assessed value of property subject to the tax resulting from (a) a change in the method by which assessed value of property is determined, (b) damage or destruction of property in the Township, and (c) closing of businesses or taxpayers moving out of the Township.

PROFESSIONALS

Robert W. Baird & Co. (the "Underwriter") is underwriting the 2012 Bonds. Parker Poe Adams & Bernstein LLP is serving as Bond Counsel to the Township. McGuireWoods LLP is serving as counsel to the Underwriter. Huey B. Marshall, Esq. is County Attorney and will be acting as Issuer Counsel on behalf of the Township. Murchison, Taylor & Gibson, PLLC is counsel to the Hospital. U.S. Bank National Association is serving as the escrow agent (the "Escrow Agent"). Barthe & Wahrman, P.A. is serving as the verification agent (the "Verification Agent").

THE PLAN OF REFUNDING

The 2012 Bonds are being issued for the purpose of (1) refunding the Refunded 2003 Bonds and (2) paying the costs of issuing the 2012 Bonds.

A portion of the proceeds from the sale of the 2012 Bonds will be applied to the purchase of certain direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (the "Government Obligations"). The Government Obligations will be held in trust by U.S. Bank National Association, as escrow agent (the "Escrow Agent") pursuant to an Escrow Agreement dated as of April 1, 2012 (the "Escrow Agreement") between the County and the Escrow Agent. The Government Obligations will mature at such times and in such amounts, and will bear interest payable at such times and in such amounts, so that sufficient moneys will be available to pay when due (1) interest on the Refunded 2003 Bonds to June 1, 2013 and (2) the redemption price of the Refunded 2003 Bonds. The Escrow Agent will apply the maturing principal of and the interest on the Government Obligations to the payment of the principal of and premium and interest on the Refunded 2003 Bonds. The Escrow Agent has been irrevocably instructed to redeem the Refunded 2003 Bonds on June 1, 2013, at a redemption price equal to the principal amount of the Refunded 2003 Bonds plus a premium of 2.00% of the principal amount thereof, plus accrued interest to the redemption date. Amounts on deposit under the Escrow Agreement will not secure the 2012 Bonds.

The Verification Agent will verify, from the information provided to it by the Underwriter, the mathematical accuracy, as of the date of issuance of the 2012 Bonds, of (1) the mathematical computations contained in the schedules provided by the Underwriter to determine that the deposit to the 2003 Bonds Account of the Escrow Fund, together with other funds available therefor listed in such schedules to be held by the Escrow Agent, will be sufficient to pay interest payments on the Refunded 2003 Bonds, when due, and the principal of and redemption premium of the Refunded 2003 Bonds on June 1, 2013 and (2) the mathematical computations of yield of the 2012 Bonds contained in the provided schedules. The Verification Agent will express no opinion on the exemption from taxation of the interest

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on the 2012 Bonds. Bond Counsel will rely on such verification in rendering its opinion as to the exclusion of interest on the 2012 Bonds from gross income of the recipients thereof for purposes of federal income taxation.

ESTIMATED SOURCES AND USES OF FUNDS

The following table presents estimated information as to sources and uses of funds and the plan of refunding:

Sources of Funds: Par Amount of 2012 Bonds $8,220,000 Original Issue Premium 1,192,907 Township Contribution1 146,618

Total $9,559,525 Uses of Funds:

Deposit to the Escrow Fund $9,419,944 Costs of Issuance2 139,581

Total $9,559,525 1 Consists of accrued interest on the Refunded 2003 Bonds. 2 Includes various professional fees, other financing costs and Underwriter's discount.

THE TOWNSHIP

GOVERNMENT

Smithville Township, as a part of Brunswick County, is governed by the Board of Commissioners for Brunswick County. The Board consists of five members elected at large on a partisan basis. The Commissioners are elected in November of even numbered years and take office on the first Monday in December following each election. At this time, the Board elects a chairman and vice chairman from among its members.

As the governing body of the Township, the Board of Commissioners is charged with crediting the limited hospital tax monies as collected to a special fiduciary hospital fund (the "Hospital Fund"). In each year, tax monies not required to pay debt service on the remaining outstanding 2003 Bonds or the 2012 Bonds are to be paid out of the Hospital Fund for maintenance and improvement of the Hospital.

The Hospital is administered by a Board of Trustees composed of residents of the Township elected at large by the eligible voters of the Township. The Board of Trustees is composed of seven members, all of which are elected for staggered six-year terms. Trustees serve without compensation.

The Board of Trustees is charged by statute with exclusive control of the expenditure of monies collected to the credit of the Hospital Fund. The Board of Trustees also appoints hospital administrative personnel.

HOSPITAL FACILITIES

The Hospital is the only hospital located in the Township. The Hospital is a township hospital located in the City of Southport, Smithville Township, Brunswick County, North Carolina. Founded through the effort of local physicians, the Hospital opened its doors in 1930 and subsequently was chartered as a public hospital under the joint ownership of Brunswick County and the City of Southport, each of whom maintained a one-half interest in the Hospital. The Hospital continued in this status until

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1976 when, pursuant to local election, the Hospital changed its organizational structure and became a township hospital under the provisions of Article 2, Chapter 131 of the General Statutes of North Carolina. An August 1976 referendum resulted in the levying of a tax to support a bond issue for the renovation and improvement of the Hospital. Chapter 131 was repealed with the creation of Chapter 131E in 1983. Chapter 131E did not expressly give townships the powers previously granted so a 1999 session law grandfathered existing townships and allowed townships to continue to operate under now-repealed Chapter 131, Article 2 but gave them Chapter 131E, Article 2, Part 2 powers, which included borrowing power.

In May, 2000 the voters of the Township elected to continue a tax to support the Hospital for an additional 30 years. The proceeds of this tax will be utilized to pay debt service on the 2012 Bonds offered hereby, the proceeds of which will be used for capital improvements to the Hospital. The State of North Carolina issued a Certificate of Need for the project in July, 2001.

The Hospital maintains a 36-bed acute care facility and 64 bed extended care facility and has 28 physicians and 31 affiliate members of the medical staff. It offers a full range of in-patient, out-patient, 24�hour emergency services and is fully accredited by the Joint Commission on Accreditation of Healthcare Organizations.

Brunswick Novant Medical Center, affiliated with Novant Health, opened to replace Brunswick Community Hospital in July 2011. This facility contains 74 private rooms, 5 operating rooms, 1 GI endoscopy room, a pharmacy, a lab and an emergency room. Brunswick Novant Medical Center is located in the approximate geographic center of the County and is approximately 17 miles from the Hospital. Brunswick Novant Medical Center primarily serves the residents of the western half of the County.

GEOGRAPHIC AND DEMOGRAPHIC CHARACTERISTICS

The Township is located in the southeastern corner of Brunswick County, North Carolina which is located in the coastal plains region of southeastern North Carolina, approximately equidistant from Washington, D.C. and Atlanta, Georgia.

Census data is not available on a township by township basis, however, the 2011 population of the Township is approximately 12,000. The population increases significantly in summer months due to the influx of vacationers. The Township is primarily rural in nature with the exception of the Town of Oak Island, the City of Southport, the Village of Bald Head Island, the Town of Caswell Beach and a portion of the Village of St. James.

The Board of Commissioners of Brunswick County may change the boundaries of the Township without any further action of the residents of the Township (See "THE 2012 BONDS - SOURCE OF

PAYMENT FOR THE 2012 BONDS").

COMMERCE AND INDUSTRY

The Township has an economy based upon marine products, agriculture, manufacturing and tourism. Tourism and retirement activities have increased significantly during the past decade. There is a large influx of people into the Township during the summer vacation months.

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DEBT INFORMATION

Legal Debt Limit. The Township may, from time to time, issue limited tax obligation bonds for the purpose of maintaining and improving a public hospital within the Township. In accordance with the provisions of the State Constitution and The Local Government Bond Act, as amended, after issuance of the 2012 Bonds offered hereby, the Township will have the statutory capacity to incur additional net debt in the approximate amount of $533,000.

The Township is accounted for in an agency fund that is maintained on its behalf on the books of the County. The Township levies an ad valorem tax that is collected by the County and from which the County remits to the Township's debt service payments. To the extent that tax monies in each year are not required for debt service, the excess tax revenues may be applied to the payment of the costs of maintaining and improving a public hospital for the Township. Bonds issued by the Township, including the 2012 Bonds, are not secured in any way by the taxing authority of the County. See pages B-68 and B-69 in Appendix B for unaudited information regarding the Agency Fund maintained by the County on behalf of the Township.

Debt Service Coverage Ratio. Pursuant to contract, the County levies and collects the limited hospital tax which is levied only on the taxable property within the Township (See "THE 2012 BONDS – SOURCE OF PAYMENT FOR THE 2012 BONDS"). The tax revenues collected will be used to pay the principal and interest on the 2012 Bonds. The remaining outstanding 2003 Bonds are the only other obligation payable from such special ad valorem tax. The chart below shows the Township's Debt Service Coverage Ratio for the prior five years and an estimate of the debt service coverage ratio following the issuance of the 2012 Bonds.

Fiscal Year Ended June 30

Assessed Valuation

Township Tax Levy Collected1

Debt Service Coverage Ratio

2008 $9,439,023,147 $3,715,167 3.73 2009 9,364,661,560 2,105,405 2.09 2010 9,743,491,407 2,180,228 2.16 2011 9,649,533,397 2,151,964 2.13 2012 6,784,762,337 2,478,4922 2.59

After 2012 Bonds now offered are issued

6,784,762,337 2,478,4922 2.86

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1 See "THE BONDS - SOURCE OF PAYMENT FOR THE 2012 BONDS" herein for a discussion of the tax levy. 2Township Levy Collected through February 17, 2012.

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Debt Service Requirements of the 2003 Bonds and the 2012 Bonds. Payments of principal of and interest on the 2012 Bonds and the 2003 Bonds that will be outstanding after the redemption of the Refunded 2003 Bonds shall be as follows:

Fiscal Year

2003 Bonds 2012 Bonds

Total Principal Interest Principal Interest

2012 $ 555,000 $ 24,150 $ - $ 47,595 $ 626,745 2013 580,000 26,100 - 349,675 955,775 2014 - - 600,000 349,675 949,675 2015 - - 625,000 331,675 956,675 2016 - - 645,000 312,925 957,925 2017 - - 675,000 287,125 962,125 2018 - - 700,000 261,750 961,750 2019 - - 735,000 233,750 968,750 2020 - - 765,000 204,350 969,350 2021 - - 805,000 173,750 978,750 2022 - - 845,000 133,500 978,500 2023 - - 890,000 91,250 981,250 2024 - - 935,000 46,750 981,750 Total $1,135,000 $ 50,250 $8,220,000 $2,823,770 $ 12,229,020

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Limited Tax Bonds Authorized and Unissued. There are no additional Township bonds authorized and unissued.

TAX INFORMATION

General Information.

Fiscal Year Ended or Ending June 30 2010 2011 20123

Assessed Valuation: Assessment Ratio1 100% 100% 100%

Real Property $8,331,074,733 $8,363,656,895 $5,285,484,679 Personal Property 319,868,016 189,741,254 366,334,824 Public Service Companies2 971,365,386 974,687,452 1,011,942,834 Motor Vehicles 121,183,272 121,447,796 121,000,000

Total Assessed Valuation $9,743,491,407 $9,649,533,397 $6,784,762,337 Rate per $100 $0.0225 $0.0225 $0.04 Net Levy $2,193,359 $2,172,298 $2,690,718 _______________

1Percentage of appraised value has been established by statute. 2Valuation of railroads, telephone companies and other utilities as determined by the North Carolina Property Tax Commission. 3Estimate.

Note: Revaluation of Real property became effective with 2011 tax levy. The next revaluation will take effect with the tax levy for the fiscal year beginning July 1, 2015.

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Tax Collections.


Prior Years' Levies Collected

Current Year's Levy Collected

Percentage of Current Year's Levy Collected

2008 $19,238 $3,695,929 97.9% 2009 54,511 2,050,894 96.9 2010 49,520 2,130,709 97.1 2011 47,618 2,105,705 96.9 2012

(Through February 17, 2012) 29,446 2,449,046 91.0

Ten Largest Township Taxpayers for Fiscal year 2010-2011.

Taxpayer Type of

Enterprise

2010-2011 Assessed Valuation Tax Levy

Percentage of Total Assessed

Valuation

Progress Energy1 Utility $785,493,333 $176,736 8.14% NC Eastern Municipal Power Agency Utility 159,088,889 35,795 1.63 Bald Head Island Limited Developer 121,862,222 27,419 1.25 Archer Daniels Midland Co. Industry 111,986,667 25,197 1.15 Brunswick Electric Utility 21,426,667 4,821 0.22 Wal-Mart Real Estate Business Trust Retail 17,182,222 3,866 0.18 MAS Properties, LLC2 Developer 15,048,889 3,386 0.15 Oak Island Golf & Country Club Leisure 10,275,556 2,312 0.11 Jesse Capel Etals Developer 8,435,556 1,898 0.09 Primary Energy of North Carolina Utility 7,146,667 1,608 0.07 Source: Brunswick County Tax Department. 1 Duke Energy and Progress Energy have announced plans to merge, subject to regulatory approval. It is uncertain how this

merger will affect the Township. 2 MAS Properties LLC is currently delinquent on its taxes and owes a total of $8,064 in taxes to the Township including balances

from the last three tax years: $ 317 for 2009, $ 4,031 for 2010 and $ 3,716 for 2011.

THE COUNTY

Because the Township's territory is located entirely within the County, certain of the functions of the Township and the County are interrelated and certain data regarding the Township separately are not available. Some information concerning the County is provided below. THE 2012 BONDS ARE NOT AN OBLIGATION OF THE COUNTY (See "THE 2012 BONDS - SOURCE OF PAYMENT FOR THE

2012 BONDS").

GEOGRAPHIC AND DEMOGRAPHIC CHARACTERISTICS

The population of the County was estimated to be 111,127 in July 2011 and has experienced an estimated growth rate of 46% since 2000.

The United States Department of Commerce, Bureau of the Census, has recorded the population of the County to be as follows:

1990 2000 2010

50,985 73,141 107,431

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Per capita income figures for the County and the State are presented in the following table:

Year County State

2006 $25,869 $33,373 2007 28,403 34,761 2008 30,324 35,740 2009 30,952 34,108 2010 Not available 34,977

Source: United States Department of Commerce, Bureau of Economic Analysis.

COMMERCE AND INDUSTRY

The County has a diversified economy based primarily upon tourism, manufacturing, agriculture, forestry and marine products. The value of the primary economic activities is shown by the following table:

2007 2008 2009 2010

Tourism $392,190,000 $392,830,000 $353,790,000 $395,380,000 Manufacturing Not Available Not Available Not Available Not Available Agriculture 37,530,000 39,867,088 35,951,000 35,384,000 Commercial

Seafood Landing

3,804,821

4,174,938

3,537,205

3,169,609 Sources: North Carolina Department of Agriculture, Brunswick County Economic Development Commission, North Carolina

Department of Commerce, North Carolina Marine Fisheries and the State Data Center.

Tourism contributions include permanent as well as secondary housing development, increased retail sales, increased employment opportunities and increased demand for potable water. Tourism or service sector jobs account for 82% of the County's employment, with manufacturing representing 16%, and agriculture/seafood accounting for the remaining 2%. Thirty-nine state of the art golf courses (with new courses under construction and in the planning stages) with most having residential/commercial development associated with them are located in the County. Agriculture remains an important factor in the County's economy with principal crops including tobacco, corn, soybeans, various grains, sweet potatoes, and blueberries. Livestock and poultry also contribute significantly to the agricultural economy along with greenhouse and nursery operations.

Construction activity in the County is illustrated by the following table showing the number and value of building permits issued by the County Building Inspections Department:

Fiscal Year

Residential Value1

No. of Permits

Commercial Value

No. of Permits

2008 $302,341,000 1,722 $89,747,000 463 2009 198,701,000 974 78,712,000 365 2010 185,428,000 1,050 44,519,000 260 2011 148,116,000 916 52,554,000 340 2012

(first 4 months)2 48,017,000 310 26,164,000 137

1 Does not include mobile homes. 2 In comparison, County building permits for the first four months of Fiscal Year 2011 were: Residential - 304 permits valued at

$49,427,000; and Commercial - 96 permits valued at $15,497,000. Source: County's Building Inspections Department.

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Much of the residential development in the County occurs in multi-unit developments, often in connection with golf-course development or in other settings aimed at the resort and retirement sectors.

Substantial portions of the County's employment and tax base are provided by Progress Energy Carolinas, Inc. ("PE") and the Brunswick Nuclear Plant ("BNP"), located in the County near Southport and owned jointly by PE and by North Carolina Eastern Municipal Power Agency. Duke Energy and Progress Energy have announced plans to merge, subject to regulatory approval. If approved, the merger would create the largest U.S. utility. It is uncertain how this merger will affect the County.

BNP is PE's largest energy production facility, producing about 18% of that corporation's total energy production. The County believes BNP will continue to operate and generate significant ad valorem tax revenues for the County, but can give no assurance that it will. Employment at BNP is currently over 1,000, and most of its employees live in the County.

Total retail sales in the County for the last five fiscal years ended June 30 are shown in the following table:


Total Retail Sales Increase (Decrease) over Previous Year

2008 $948,556,453 (0.3)% 2009 906,375,513 (4.4) 2010 953,091,346 5.1 2011 991,119,126 4.0 2012 (3 months)1 352,071,261 7.1

____________________ 1 Retail sales in the County for the first three months of Fiscal Year 2011 were $328,720,310. Source: North Carolina Department of Revenue, Sales and Use Tax Division.

EMPLOYMENT

The North Carolina Employment Security Commission has estimated the percentage of unemployment (not seasonally adjusted) in the County to be as follows:

2008 2009 2010 2011 2008 2009 2010 2011

January 6.1% 11.1% 13.9% 12.2% July 6.4% 10.6% 10.4% 10.4% February 5.7 11.7 13.5 11.9 August 6.6 10.6 10.2 10.8 March 5.2 10.9 12.4 10.9 September 6.4 10.4 9.8 10.6 April 4.7 9.9 10.8 10.3 October 6.9 10.6 9.8 10.5 May 5.5 10.4 10.5 10.0 November 8.1 11.5 11.0 10.5 June 5.9 10.7 10.6 10.3 December 9.2 12.4 11.3 11.9

The North Carolina Employment Security Commission has estimated the percentage of unemployment (not seasonally adjusted) in the County, the State and the United States to be as follows:

County State United States December 2008 9.2% 8.2% 7.1% December 2009 12,4 11.1 9.4 December 2010 11,3 9.7 9.1 December 2011 11.9 9.8 8.3

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The top ten largest employers in the County are shown in the following table:

Company or Institution Service or Product Approximate Number

of Employees

Brunswick County Board of Education Education 1,955 County of Brunswick Local Government 1,029 Progress Energy Carolinas, Inc. 1 Utility 833 Wal-Mart Associates Inc. Retail Chain 750 Food Lion LLC Grocery Chain 455 Brunswick Community Hospital LLC Medical Care Facility 450 DAK Americas Dacron Polyester Fiber 383 Dosher Memorial Hospital Medical Care Facility 362 Brunswick Community College Education 358 Ports America/Marine Terminals Corp. Trade/Transportation 325 Source: North Carolina Department Employment Security Commission. 1 Duke Energy and Progress Energy have announced plans to merge, subject to regulatory approval. It is uncertain how this merger will affect the County.

COUNTY TAX INFORMATION

General Information.

Fiscal Year Ended or Ending June 30

2009 2010 2011 2012 Estimate3

Assessed Valuation: 100% 100% 100% 100% Assessment Ratio1

Residential Property $24,540,162,506 $25,058,952,514 $25,098,973,654 $17,820,546,796 Business Property 6,222,828,289 6,390,536,083 6,400,742,277 4,544,597,275 Boats and Vessels 62,505,825 75,304,158 77,195,795 40,508,980 Public Service Companies2

1,209,123,070 1,149,034,376 1,153,728,963 1,198,574,131

Motor Vehicles 952,405,098 872,773,368 877,834,892 899,803,681 Total Assessed Valuation

$33,068,024,788 $33,546,600,499 $33,608,475,581 $24,504,030,863

Rate per $100 0.305 0.305 0.305 0.4425 Net Levy $ 100,857,476 $ 102,317,132 $ 102,505,851 $ 108,430,337 Per Capita Assessed Valuation

Population 106,586 108,176 111,127 114,078 Assessed Valuation $33,068,024,788 $33,546,600,499 $33,608,475,581 $24,504,030,863 Per Capita $ 310,247 $ 310,111 $ 302,433 $ 214,801

1 Percentage of appraised value has been established by statute. 2 Valuation of railroads, telephone companies and other utilities as determined by the North Carolina Property Tax Commission. 3 Estimate. Revaluation of real property became effective with the tax levy for the fiscal year ending June 30, 2011. Results of

the revaluation reflect an overall decrease in valuation of approximately 29%. The County's tax rate has been adjusted following revaluation to produce an approximately level tax yield. The County's next revaluation will take effect with the tax levy for the fiscal year beginning July 1, 2014.

Source: North Carolina State Data Center.

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Tax Collections.


Total Tax Levy

Collections Within Fiscal Year of Levy

Percentage of Current Year's Levy Collected

Percentage Collected as of June 30, 2011

2007 $83,889,972 $81,622,970 97.3% 99.7% 2008 96,784,569 94,153,697 97.3 99.6 2009 101,046,887 96,240,283 95.2 98.8 2010 101,891,061 96,670,482 94.9 94.9 2011 102,547,430 96,734,004 94.3 94.3

Ten Largest Taxpayers for Fiscal Year 2011.

Taxpayer Type of Business

2010 Assessed

Valuation

Percentage of Total

Assessed Valuation

Progress Energy Carolinas, Inc.1 Utility $800,052,745 2.38% DAK of America Chemicals 172,414,240 0.51 N.C. Eastern Municipal Power Agency Utility 160,376,972 0.48 Brunswick Electric Membership Corp. Utility 158,572,871 0.47 Bald Head Island Ltd Developer 121,860,637 0.36 Red Mountain Timberco LLC Forestry 117,491,110 0.35 Archer Daniels Midland Company Chemicals 111,987,145 0.33 MAS Properties LLC2 Developer 95,207,116 0.28 Odell Williamson Developer 76,596,620 0.23 Funston Land & Timber LLC Timber 72,577,480 0.22 Source: Brunswick County Tax Department. 1 Duke Energy and Progress Energy have announced plans to merge, subject to regulatory approval. It is uncertain how this

merger will affect the County. 2 MAS Properties LLC is currently delinquent on its taxes and owes a total of $3,495,718 in taxes to the County including

balances from the last four tax years: $581,695 for 2008, $986,250 for 2009, $1,172,346 for 2010 and $755,427 for 2011. FINANCIAL INFORMATION OF THE COUNTY

The financial statements of the County have been audited by certified public accountants for the Fiscal Year ended June 30, 2011. Copies of these financial statements containing the unqualified report of the independent certified public accountants are available in the office of Ms. Ann B. Hardy, Director of Fiscal Operations, 30 Government Center Drive, Bolivia, North Carolina 28422 ((910) 253-2068) or online by going to the County's website at http://www.brunsco.net/Departments/GeneralGovernment/Finance.aspx and clicking on the Financial Statements.

The audited financial statements in Appendix B are the Basic Financial Statements of the County and the notes thereto, taken from the Comprehensive Annual Financial Report of the County for the Fiscal Year ended June 30, 2011. The County will certify at the time that the 2012 Bonds are issued that there has been no material adverse change in the County's financial position since June 30, 2011. See pages B-68 and B-69 in Appendix B for unaudited information regarding the Agency Fund maintained by the County on behalf of the Township.

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CONTINUING DISCLOSURE

In accordance with the requirements of Rule 15c2-12 promulgated by the SEC under the Securities Exchange Act of 1934 ("Rule 15c2-12"), in a resolution adopted by the Board of Commissioners of the County, acting as the governing body of the Township, the County, acting on behalf of the Township, has undertaken, for the benefit of the beneficial owners of the 2012 Bonds, to provide:

(1) by not later than seven months after the end of each Fiscal Year, beginning with the Fiscal Year ending June 30, 2012, to the MSRB in an electronic format prescribed by the MSRB, the audited financial statements of the County, which include an agency fund to account for the debt of the Township, for the preceding 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 then available, unaudited financial statements of the County for such Fiscal Year to be replaced subsequently by audited financial statements of the County to be delivered within 15 days after such audited financial statements become available for distribution; (2) by not later than seven months after the end of each Fiscal Year, beginning with the Fiscal Year ending June 30, 2012, to the MSRB, (a) the financial and statistical data as of a date not earlier than the end of the preceding Fiscal Year for the type of information included under the captions "THE TOWNSHIP--DEBT INFORMATION" and "--TAX INFORMATION" (excluding information on overlapping units), and (b) 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 clause (1) above; (3) in a timely manner not in excess of 10 business days after the occurrence of the event, to the MSRB, notice of any of the following events with respect to the 2012 Bonds: (a) principal and interest payment delinquencies; (b) non-payment related defaults, if material; (c) unscheduled draws on the debt service reserves reflecting financial difficulties; (d) unscheduled draws on any credit enhancements reflecting financial difficulties; (e) substitution of any credit or liquidity providers, or their failure to perform; (f) adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material events affecting the tax status of the 2012 Bonds; (g) modification of the rights of the beneficial owners of the 2012 Bonds, if material; (h) call of any of the 2012 Bonds, if material, and tender offers; (i) defeasance of any of the 2012 Bonds; (j) release, substitution or sale of any property securing repayment of the 2012 Bonds, if material; (k) rating changes;

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(l) bankruptcy, insolvency, receivership or similar event of the Township; (m) the consummation of a merger, consolidation, or acquisition involving the Township or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to such actions, other than pursuant to its terms, if material; and (n) appointment of a successor or additional trustee or the change of name of a trustee, if material; and (4) in a timely manner to the MSRB, notice of the failure by the County to provide the required annual financial information described in (1) and (2) above on or before the date specified.

At present, Section 159-34 of the General Statutes of North Carolina requires that the County's

financial statements be prepared in accordance with generally accepted accounting principles and that they be audited in accordance with generally accepted auditing standards.

The County, acting on behalf of the Township, acknowledges in the resolution that its undertaking pursuant to Rule 15c2-12 is intended to be for the benefit of the Owners and the beneficial owners of the 2012 Bonds. The Resolution provides that if the County fails to comply with the undertaking described above, the Trustee or any beneficial owner of the 2012 Bonds may take action to enforce the rights of all beneficial owners with respect to such undertaking, including an action for specific performance; provided, however, that failure by the County to comply with such undertaking will not be an event of default under the resolution and will not result in acceleration of the payment of the 2012 Bonds. All actions must be instituted, had and maintained in the manner provided in the resolution for the benefit of all of the Owners and beneficial owners of the 2012 Bonds.

The County has not knowingly failed to comply with its previous continuing disclosure obligations; however, since 2008, the rating agencies have periodically downgraded the claims-paying ability of municipal bond insurers several times without giving notice of such downgrades to the County. The County has learned of some downgrades through general media sources and, when it did so, filed the appropriate material event notice related to such ratings downgrades to the extent they are applicable to the County's indebtedness; however, it is possible that the County either was unaware of a downgrade or did not learn of a downgrade in order to file a notice in a timely fashion.

The County, acting on behalf of the Township, may modify from time to time, consistent with Rule 15c2-12, the information provided or the format of the presentation of such information, to the extent necessary or appropriate in the judgment of the County, but:

(1) 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 or the Township;

(2) the information to be provided, as modified, would have complied with

the requirements of Rule 15c2-12 as of the date of this Official Statement, after taking into account any amendments or interpretations of Rule 15c2-12 as well as any changes in circumstances; and

(3) any such modification does not materially impair the interest of the

registered owners or the beneficial owners, as determined by nationally recognized bond

16

counsel or by the approving vote of the owners of a majority in principal amount of the 2012 Bonds.

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.

The provisions described under this caption terminate on payment, or provision having been made for payment in a manner consistent with Rule 15c2-12, in full of the principal of and interest on the 2012 Bonds.

All documents provided to the MSRB as described under this caption shall be provided in an

electronic format as prescribed by the MSRB and accompanied by identifying information as prescribed by the MSRB. The County, acting on behalf of the Township, may discharge its undertaking described above by transmitting those documents or notices in a manner subsequently required by the SEC in lieu of the manner described above.

APPROVAL OF LEGAL PROCEEDINGS

Certain legal matters incident to the authorization and issuance of the 2012 Bonds are subject to the approval of Parker Poe Adams & Bernstein LLP, Raleigh, North Carolina, Bond Counsel, whose legal opinion will be available at the time of the delivery of the 2012 Bonds. The proposed form of such opinion is attached hereto as Appendix C.

RATINGS

Moody's Investors Service, Inc. ("Moody's") and Standard & Poor's Ratings Services, a Standard & Poor's Financial Services LLC business ("S&P"), have assigned independent underlying ratings of "A1" and "AA," respectively, to the 2012 Bonds. Such ratings reflect only the view of Moody's and S&P at the time the ratings were given, and neither the Township nor the Underwriter make any representations as to the appropriateness of such ratings.

The ratings are not a recommendation to buy, sell or hold the 2012 Bonds and should be evaluated independently. There is no assurance that such ratings will not be withdrawn or revised downward by Moody's or S&P. Any such action may have an adverse effect on the market price of the 2012 Bonds. Neither the Township nor the Underwriter has undertaken any responsibility after the execution and delivery of the 2012 Bonds to assure maintenance of the ratings or to oppose any such revision or withdrawal.

TAX TREATMENT

GENERAL

On the date of issuance of the 2012 Bonds, Parker Poe Adams & Bernstein LLP, Raleigh, North Carolina ("Bond Counsel"), will render an opinion that, under existing law and assuming compliance by the County with certain provisions of the Internal Revenue Code of 1986, as amended (the "Code"), the interest on the 2012 Bonds is excludable from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations. The interest on the 2012 Bonds will be taken into account in determining adjusted current earnings of certain corporations (as defined for federal income tax purposes) and such corporations are required to include in the calculation of federal alternative minimum taxable income 75% of the excess of

17

such corporation's adjusted current earnings over its federal alternative minimum taxable income (determined without regard to this adjustment and prior to reduction for certain net operating losses).

The Code imposes various restrictions, conditions and requirements relating to the exclusion of interest on obligations, such as the 2012 Bonds, from gross income for federal income tax purposes, including, but not limited to, the requirement that the County rebate certain excess earnings on proceeds and amounts treated as proceeds of the 2012 Bonds to the United States Treasury, restrictions on the investment of such proceeds and other amounts, and restrictions on the ownership and use of the facilities financed or refinanced with proceeds of the 2012 Bonds. The foregoing is not intended to be an exhaustive listing of the post-issuance tax compliance requirements of the Code, but is illustrative of the requirements that must be satisfied by the County subsequent to issuance of the 2012 Bonds to maintain the excludability of the interest on the 2012 Bonds from gross income for federal income tax purposes. Bond Counsel's opinion is given in reliance on certifications by representatives of the County as to certain facts material to the opinion and the requirements of the Code. The County has covenanted in the Bond Resolution to comply with all requirements of the Code that must be satisfied subsequent to the issuance of the 2012 Bonds in order that the interest on the 2012 Bonds be, or continue to be, excludable from gross income for federal income tax purposes. The opinion of Bond Counsel assumes compliance by the County with such covenants, and Bond Counsel has not been retained to monitor compliance by the County with such covenants subsequent to the date of issuance of the 2012 Bonds. Failure to comply with certain of such requirements may cause the interest on the 2012 Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the 2012 Bonds. No other opinion is expressed by Bond Counsel regarding the federal tax consequences of the ownership of or the receipt or accrual of interest with respect to the 2012 Bonds. If the interest on the 2012 Bonds subsequently becomes included in gross income for federal income tax purposes due to a failure by the County to comply with any requirements described above, the Indenture does not require the County to redeem the 2012 Bonds or to pay any additional interest or penalty. The Internal Revenue Service has established an ongoing program to audit tax-exempt obligations to determine whether interest on such obligations is includible in gross income for federal income tax purposes. Bond Counsel cannot predict whether the Internal Revenue Service will commence an audit of the 2012 Bonds. Prospective purchasers and owners of the 2012 Bonds are advised that, if the Internal Revenue Service does audit the 2012 Bonds, under current Internal Revenue Service procedures, at least during the early stages of an audit, the Internal Revenue Service will treat the County as the taxpayer, and the owners of the 2012 Bonds may have limited rights, if any, to participate in such audit. The commencement of an audit could adversely affect the market value and liquidity of the 2012 Bonds until the audit is concluded, regardless of the ultimate outcome. Prospective purchasers of the 2012 Bonds should be aware that ownership of the 2012 Bonds and the accrual or receipt of interest on the 2012 Bonds may result in collateral federal income tax consequences to certain taxpayers, including, without limitation, financial institutions, property or casualty insurance companies, individual recipients of Social Security or Railroad Retirement benefits, certain Subchapter S Corporations with "excess net passive income," foreign corporations subject to the branch profits tax, life insurance companies and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry the 2012 Bonds. Bond Counsel does not express any opinion as to any such collateral tax consequences. Prospective purchasers of the 2012 Bonds should consult their own tax advisors as to the collateral tax consequences. Proposed legislation is considered from time to time by the United States Congress that, if enacted, would affect the tax consequences of owning the 2012 Bonds. No assurance can be given that any future legislation, or clarifications or amendments to the Code, if enacted into law, will not contain

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provisions which could cause the interest on the 2012 Bonds to be subject directly or indirectly to federal or State of North Carolina income taxation, adversely affect the market price or marketability of the 2012 Bonds or otherwise prevent the owners of the 2012 Bonds from realizing the full current benefit of the status of the interest on the 2012 Bonds.

Bond Counsel is further of the opinion that, under existing law, the interest on the 2012 Bonds is exempt from State of North Carolina income taxation.

Bond Counsel's opinion is based on existing law, which is subject to change. Such opinion is further based on factual representations made to Bond Counsel as of the date thereof. Bond Counsel assumes no duty to update or supplement its opinion to reflect any facts or circumstances that may thereafter come to Bond Counsel's attention, or to reflect any changes in law that may thereafter occur or become effective. Moreover, Bond Counsel's opinion is not a guarantee of a particular result, and is not binding on the Internal Revenue Service or the courts; rather, such opinion represents Bond Counsel's professional judgment based on its review of existing law, and in reliance on the representations and covenants that Bond Counsel deems relevant to such opinion. Bond Counsel's opinion expresses the professional judgment of the attorneys rendering the opinion regarding the legal issues expressly addressed therein. By rendering its opinion, Bond Counsel does not become an insurer or guarantor of the result indicated by that expression of professional judgment, of the transaction on which the opinion is rendered, or of the future performance of the County, nor does the rendering of such opinion guarantee the outcome of any legal dispute that may arise out of the transaction. ORIGINAL ISSUE PREMIUM

As indicated on the inside cover page, the 2012 Bonds are being sold at initial offering prices which are in excess of the principal amount payable at maturity. The difference between (a) the initial offering prices to the public (excluding bond houses and brokers) at which a substantial amount of the 2012 Bonds is sold and (b) the principal amount payable at maturity of such 2012 Bonds constitutes original issue premium, which original issue premium is not deductible for federal income tax purposes. In the case of an owner of a 2012 Bond, however, the amount of the original issue premium which is treated as having accrued over the term of such 2012 Bond is reduced from the owner's cost basis of such 2012 Bond in determining, for federal income tax purposes, the taxable gain or loss upon the sale, redemption or other disposition of such 2012 Bond (whether upon its sale, redemption or payment at maturity). Owners of 2012 Bonds should consult their tax advisors with respect to the determination, for federal income tax purposes, of the "adjusted basis" of such 2012 Bonds upon any sale or disposition and with respect to any state or local tax consequences of owning a Premium Bond.

UNDERWRITING

The underwriter for the 2012 Bonds is Robert W. Baird & Co.

The Underwriter has agreed under the terms of a Bond Purchase Agreement to purchase all of the 2012 Bonds, if any of the 2012 Bonds are to be purchased, at a purchase price equal to $9,336,160.50, representing the principal amount of the 2012 Bonds, plus original issue premium of $1,192,907.00 and less the Underwriter's discount of $76,746.50. The Underwriter's obligation to purchase the 2012 Bonds is subject to certain terms and conditions set forth in the Bond Purchase Agreement.

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MISCELLANEOUS

Any statements in this Official Statement involving matters of opinion or estimates, whether or not expressly so stated, are intended as such and not as representations of fact.

References herein to the State Constitution and legislative enactments are only brief outlines of certain provisions thereof and do not purport to summarize or describe all provisions thereof.

Parker Poe Adams & Bernstein LLP is serving as bond counsel for the County and, from time to time it and McGuireWoods LLP, counsel to the Underwriter, have represented the Underwriter as counsel in other financing transactions. Neither the County nor the Underwriter have conditioned the future employment of either of these firms in connection with any proposed financing issues for the County or for the Underwriter on the successful issuance of the 2012 Bonds.

[THIS PAGE INTENTIONALLY LEFT BLANK]

APPENDIX A

THE NORTH CAROLINA LOCAL GOVERNMENT COMMISSION

A-1

THE NORTH CAROLINA LOCAL GOVERNMENT COMMISSION The Local Government Commission (the "Commission") is composed of nine members: the State Treasurer, the Secretary of State, the State Auditor, the Secretary of Revenue and five others by appointment (three by the Governor, one by the General Assembly upon recommendation of the President Pro Tempore of the Senate and one by the General Assembly upon recommendation of the Speaker of the House of Representatives). The State Treasurer serves as Chairman and selects the Secretary of the Commission, who heads the administrative staff serving the Commission. A major function of the Commission is the approval, sale and delivery of substantially all North Carolina local government bonds and notes. A second key function is monitoring certain fiscal and accounting standards prescribed for units of local government by The Local Government Budget and Fiscal Control Act. In addition, the Commission furnishes, upon request, on-site assistance to units of local government concerning existing financial and accounting systems as well as aid in establishing new systems. Further, educational programs and materials are provided for local officials concerning finance and cash management. Before any unit of local government can incur bonded indebtedness, the proposed bond issue must be approved by the Commission. In determining whether to give such approval the Commission may consider, among other things, the unit's debt management procedures and policies, its compliance with The Local Government Budget and Fiscal Control Act and its ability to service the proposed debt. All general obligation issues are customarily sold on the basis of formal sealed bids submitted at the Commission's offices in Raleigh and are subsequently delivered to the successful bidder by the Commission. The Commission maintains records for all units of local government of principal and interest payments coming due on bonded indebtedness in the current and future years and monitors the payment by the units of local government of debt service through a system of monthly reports. As a part of its role in assisting and monitoring the fiscal programs of units of local government, the Commission attempts to ensure that the units of local government follow generally accepted accounting principles, systems and practices. The Commission's staff also counsels the units of local government in treasury and cash management, budget preparation and investment policies and procedures. Educational programs, in the form of seminars or classes, are also provided by the Commission in order to accomplish these tasks. The monitoring of the financial systems of units of local government is accomplished through the examination and analysis of the annual audited financial statements and other required reports. The Local Government Budget and Fiscal Control Act requires each unit of local government to have its accounts audited annually by a certified public accountant or by an accountant certified by the Commission as qualified to audit local government accounts. A written contract must be submitted to the Secretary of the Commission for his approval prior to the commencement of the audit. The Commission has the statutory authority to impound the books and records of any unit of local government and assume full control of all its financial affairs (a) when the unit defaults on any debt service payment or, in the opinion of the Commission, will default on a future debt service payment if the financial policies and practices of the unit are not improved or (b) when the unit persists, after notice and warning from the Commission, in willfully or negligently failing or refusing to comply with the provisions of The Local Government Finance Act. When the Commission takes action under this authority, the Commission is vested with all of the powers of the governing board of the unit of local government as to the levy of taxes, expenditure of money, adoption of budgets and all other financial powers conferred upon such governing board by law. In addition, if a unit of local government fails to pay any installment of principal or interest on its outstanding debt on or before its due date and remains in default for 90 days, the Commission may take such action as it deems advisable to investigate the unit's fiscal affairs, consult with its governing board

A-2

and negotiate with its creditors in order to assist the unit in working out a plan for refinancing, adjusting or compromising such debt. When a plan is developed that the Commission finds to be fair and equitable and reasonably within the ability of the unit of local government to meet, the Commission will enter an order finding that the plan is fair, equitable and within the ability of the unit to meet and will advise the unit to take the necessary steps to implement such plan. If the governing board of the unit declines or refuses to do so within 90 days after receiving the Commission's advice, the Commission may enter an order directing the unit to implement such plan and may apply for a court order to enforce such order. When a refinancing plan has been put into effect, the Commission has the authority (a) to require any periodic financial reports on the unit's financial affairs that the Secretary deems necessary and (b) to approve or reject the unit's annual budget ordinance. The governing board of the unit of local government must also obtain the approval of the Secretary of the Commission before adopting any annual budget ordinance. The power and authority granted to the Commission as described in this paragraph will continue with respect to a defaulting unit of local government until the Commission is satisfied that the unit has performed or will perform the duties required of it in the refinancing plan and until agreements made with the unit's creditors have been performed in accordance with such plan.

APPENDIX B

FINANCIAL STATEMENTS

Management Discussion and Analysis

The following is Management’s Discussion and Analysis of the financial activities of the County, lifted from the Comprehensive Annual Financial Report for the County of Brunswick for the fiscal year ended June 30, 2011. Management’s Discussion and Analysis provides an objective and easily readable short and long-term analysis of the County’s financial activities based on currently known facts, decisions or conditions. Management’s Discussion and Analysis is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. The independent auditors of the County have applied certain limited procedures, which consist primarily of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, they did not audit this information and did not express an opinion on it.

B-1


B-2

BASIC FINANCIAL STATEMENTS

The following financial statements are the Basic Financial Statements of the County and the notes thereto, lifted from the Comprehensive Annual Financial Report of the County for the fiscal year ended June 30, 2011.

B-14


SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCEFOR THE YEAR ENDED JUNE 30, 2011, WITH COMPARATIVE INFORMATION FOR JUNE 30, 2010

Revenues: Actual 2011 Actual 2010Ad Valorem Taxes:Current year taxes 2,108,130$ 2,106,872$ Prior years taxes 44,328 46,810 Penalties and interest 16,979 25,954 Total revenues 2,169,437 2,179,636

Expenditures:Debt Service:Principal retirement 525,000 500,000 Interest and fees 504,655 525,114 Total debt service 1,029,655 1,025,114

Other Human Services:Contribution to Dosher Hospital 1,135,721 1,199,128

Total expenditures 2,165,376 2,224,242

Net change in fund balance 4,061 (44,606)

Fund balance, beginning of year 1,091,255 1,135,861

Fund balance, end of year 1,095,315$ 1,091,255$

B-68

THE FOLLOWING TWO PAGES ARE UNAUDITED INFORMATION PROVIDED BY THE COUNTY REGARDING THE AGENCY FUND MAINTAINED BY THE COUNTY ON BEHALF OF THE TOWNSHIP.


BALANCE SHEETFOR THE YEAR ENDED JUNE 30, 2011, WITH COMPARATIVE INFORMATION FOR JUNE 30, 2010

Assets: June 30, 2011 June 30, 2010Cash in name of Brunswick County 1,093,957$ 1,087,557$ Interest receivable 1,359 3,698 Taxes receivable, net 44,880 35,344 Total assets 1,140,196$ 1,126,599$

Liabilities:Deferred revenue 44,881 35,344

Fund balance:Unassigned fund balance 1,095,315 1,091,255

Total liabilities and fund balance 1,140,196$ 1,126,599$

B-69

APPENDIX C

PROPOSED FORM OF BOND COUNSEL OPINION

C-1

APPENDIX C

PROPOSED FORM OF BOND COUNSEL OPINION

April 12, 2012

Smithville Township, North Carolina Bolivia, North Carolina

$8,220,000 Smithville Township, North Carolina

Limited Tax Hospital Refunding Bonds, Series 2012 Ladies and Gentlemen: We have acted as bond counsel in connection with the issuance and sale by Smithville Township, North Carolina (the “Township”) of $8,220,000 aggregate principal amount of its Limited Tax Hospital Refunding Bonds, Series 2012 (the “2012 Bonds”). The 2012 Bonds are issuable as fully registered obligations and will mature and bear interest at the rates and at the times established in the “Pricing Certificate” as defined in the Bond Resolution adopted by the Board of Commissioners (the “Board”) of the County of Brunswick, North Carolina (the “County”), sitting as governing body of the Township, on March 5, 2012 (the “Bond Resolution”). Proceeds of the 2012 Bonds will be used to defease the Township's Limited Tax Hospital Bonds, Series 2003 (the "2003 Bonds") maturing on and after June 1, 20__. After issuance of the 2012 Bonds, the 2003 Bonds maturing on June 1, 20__ through June 1, 20__ will remain outstanding (the "Outstanding 2003 Bonds"). In connection with the issuance of the 2012 Bonds, we have examined the following, and we have assumed the truth and accuracy of the representations, covenants and warranties set forth therein:

(a) Certified copies of (1) the bond order adopted by the Board on February 6, 2012 effective on the adoption thereof and (2) the Bond Resolution;

(b) A specimen 2012 Bond; and (c) Such other documents as we deemed relevant and necessary in rendering

this opinion.

We have also relied on the opinion of Murchison, Taylor & Gibson PLLC, counsel to the J. Arthur Dosher Memorial Hospital (the “Hospital”), dated the date hereof, with respect to the Hospital’s status as an organization exempt from federal income tax as described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, without undertaking to verify such opinion by independent investigation. From such examination we are of the opinion, under existing law, that:

Smithville Township, North Carolina April 12, 2012 Page 2

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1. The 2012 Bonds have been duly authorized under the provisions of the Constitution and laws of the State of North Carolina (the “State”), including Chapter 131E, Article 2, Part 2 of the North Carolina General Statutes, as amended and the Local Government Bond Act of North Carolina, as amended. 2. The 2012 Bonds are legal, valid and binding general obligations of the Township. The rights of the owners of the 2012 Bonds and the enforceability of the 2012 Bonds may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’ rights heretofore or hereafter enacted to the extent constitutionally applicable, and their enforcement may also be subject to the exercise of judicial discretion in appropriate cases. 3. The 2012 Bonds and the Outstanding 2003 Bonds are payable solely from a limited special ad valorem tax levied on the assessed property located within the Township and limited to a rate of four cents per $100 assessed valuation. 4. Interest on the 2012 Bonds is excludable from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, however, such interest is taken into account in determining adjusted current earnings for the purpose of computing federal alternative minimum tax imposed on certain corporations. The opinion set forth in the preceding sentence is subject to the condition that the Township comply with all requirements of the Internal Revenue Code of 1986, as amended, that must be satisfied subsequent to the issuance of the 2012 Bonds in order that interest thereon be, or continue to be, excludable from gross income for federal income tax purposes. The Township has covenanted to comply with all such requirements. Failure to comply with certain of such requirements may cause interest on the 2012 Bonds to be included in gross income for federal income tax purposes retroactive to the date of issuance of the 2012 Bonds. We express no opinion regarding other federal tax consequences arising with respect to the 2012 Bonds. 5. The interest on the 2012 Bonds is exempt from State of North Carolina income taxation. In rendering the foregoing opinions, we have assumed the accuracy and truthfulness of all public records and of all certifications, documents and other proceedings examined by us that have been executed or certified by public officials acting within the scope of their official capacities and have not verified the accuracy or truthfulness thereof. We have also assumed the genuineness of the signatures appearing upon such public records, certifications, and documents and proceedings. Respectfully submitted, PARKER POE ADAMS & BERNSTEIN LLP

APPENDIX D

BOOK-ENTRY SYSTEM

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THE FOLLOWING DESCRIPTION OF DTC, OF PROCEDURES AND RECORD KEEPING ON BENEFICIAL

OWNERSHIP INTERESTS IN THE 2012 BONDS, PAYMENT OF INTEREST AND OTHER PAYMENTS ON THE 2012

BONDS TO DTC PARTICIPANTS OR TO BENEFICIAL OWNERS, CONFIRMATION AND TRANSFER OF

BENEFICIAL OWNERSHIP INTERESTS IN THE 2012 BONDS, AND OR OTHER TRANSACTIONS BY AND

BETWEEN DTC, DTC PARTICIPANTS AND BENEFICIAL OWNERS IS BASED ON INFORMATION FURNISHED

BY DTC. The Depository Trust Company a subsidiary of The Depository Trust & Clearing Corporation

The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the 2012 Bonds. The 2012 Bonds will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered certificate will be issued for each maturity of the 2012 Bonds, in the aggregate principal amount of such maturity, and will be deposited with DTC. SO LONG AS

CEDE & CO. IS THE REGISTERED OWNER OF THE 2012 BONDS, AS DTC'S PARTNERSHIP NOMINEE, REFERENCE HEREIN TO THE OWNERS OR REGISTERED OWNERS OF THE 2012 BONDS SHALL MEAN CEDE &

CO. AND SHALL NOT MEAN THE BENEFICIAL OWNERS OF THE 2012 BONDS.

DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of the 2012 Bonds. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has Standard & Poor's highest rating: AAA. The DTC rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org.

Purchases of 2012 Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the 2012 Bonds on DTC's records. The ownership interest of each actual purchaser of the 2012 Bonds ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the 2012 Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in 2012 Bonds, except in the event that use of the book-entry system for the 2012 Bonds is discontinued.

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To facilitate subsequent transfers, all 2012 Bonds deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of 2012 Bonds with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the 2012 Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such 2012 Bonds arc credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of 2012 Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the 2012 Bonds, such as prepayments, tenders, defaults, and proposed amendments to the security documents. For example, Beneficial Owners of 2012 Bonds may wish to ascertain that the nominee holding the 2012 Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them.

Prepayment notices shall be sent to DTC. If less than all of the 2012 Bonds within a maturity are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to 2012 Bonds unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to County as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts 2012 Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

BECAUSE DTC IS TREATED AS THE OWNER OF THE 2012 BONDS FOR SUBSTANTIALLY ALL

PURPOSES UNDER THE BOND ORDER, BENEFICIAL OWNERS MAY HAVE A RESTRICTED ABILITY TO

INFLUENCE IN A TIMELY FASHION REMEDIAL ACTION OR THE GIVING OR WITHHOLDING OF REQUESTED

CONSENTS OR OTHER DIRECTIONS. IN ADDITION, BECAUSE THE IDENTITY OF BENEFICIAL OWNERS IS

UNKNOWN TO THE COMMISSION, TO THE COUNTY, TO DTC OR TO THE TRUSTEE, IT MAY BE DIFFICULT TO

TRANSMIT INFORMATION OF POTENTIAL INTEREST TO BENEFICIAL OWNERS IN AN EFFECTIVE AND

TIMELY MANNER. BENEFICIAL OWNERS SHOULD MAKE APPROPRIATE ARRANGEMENTS WITH THEIR

BROKER OR DEALER REGARDING DISTRIBUTION OF INFORMATION REGARDING THE 2012 BONDS THAT

MAY BE TRANSMITTED BY OR THROUGH DTC.

Prepayment proceeds, distributions, and dividend payments on the 2012 Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from Trustee, on the payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, the Trustee, the County or the Commission, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of prepayment proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the Trustee's responsibility, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and

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Indirect Participants. THE COMMISSION AND THE COUNTY CANNOT AND DO NOT GIVE ASSURANCE THAT

DIRECT AND INDIRECT PARTICIPANTS WILL PROMPTLY TRANSFER PAYMENTS TO BENEFICIAL OWNERS.

A Beneficial Owner shall give notice to elect to have its 2012 Bonds purchased or tendered, through its Participant, to the Remarketing Agent, and shall effect delivery of such 2012 Bonds by causing the Direct Participant to transfer the Participant's interest in the 2012 Bonds, on DTC's records, to the Remarketing Agent. The requirement for physical delivery of 2012 Bonds in connection with an optional tender or a mandatory purchase will be deemed satisfied when the ownership rights in the 2012 Bonds are transferred by Direct Participants on DTC's records and followed by a book-entry credit of tendered 2012 Bonds to the Remarketing Agent's DTC account.

DTC may discontinue providing its services as depository with respect to the 2012 Bonds at any time by giving reasonable notice to the Commission, the County and the Trustee. Under such circumstances, in the event that a successor depository is not obtained, physical certificates are required to be printed and delivered.

The Commission or the County may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, 2012 Bonds will be printed and delivered to DTC.

The information in this section concerning DTC and DTC's book-entry system has been obtained from sources the Commission and the County believe to be reliable, but the Commission and the County take no responsibility for the accuracy thereof.

THE COMMISSION, THE COUNTY AND THE TRUSTEE HAVE NO RESPONSIBILITY OR OBLIGATION TO

DTC, THE DIRECT PARTICIPANTS, THE INDIRECT PARTICIPANTS OR THE BENEFICIAL OWNERS WITH

RESPECT TO (1) THE ACCURACY OF ANY RECORDS MAINTAINED BY DTC OR ANY PARTICIPANT, OR THE

MAINTENANCE OF ANY RECORDS; (2) THE PAYMENT BY DTC OR ANY PARTICIPANT OF ANY AMOUNT DUE

TO ANY BENEFICIAL OWNER IN RESPECT OF THE 2012 BONDS, OR THE SENDING OF ANY TRANSACTION

STATEMENTS; (3) THE DELIVERY OR TIMELINESS OF DELIVERY BY DTC OR ANY PARTICIPANT OF ANY

NOTICE TO ANY BENEFICIAL OWNER WHICH IS REQUIRED OR PERMITTED UNDER THE BOND ORDER TO BE

GIVEN TO OWNERS; (4) THE SELECTION OF THE BENEFICIAL OWNERS TO RECEIVE PAYMENTS UPON ANY

PARTIAL PREPAYMENT OF THE 2012 BONDS; OR (5) ANY CONSENT GIVEN OR OTHER ACTION TAKEN BY

DTC OR ITS NOMINEE AS THE REGISTERED OWNER OF THE 2012 BONDS, INCLUDING ANY ACTION TAKEN

PURSUANT TO AN OMNIBUS PROXY.

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