Agenda - Council - 08/13/2013 - Laserfiche WebLink

Home

Loan of Series 2013 Bond Proceeds; Mortgage Proceeds of the Series 2013 Bonds will be loaned to the Company pursuant to the Loan Agreement under which the Company will agree to make monthly payments ("Loan Repayments") which, if fully and promptly paid, will be sufficient to pay when due the scheduled principal of and interest on the Series 2013 Bonds. See Appendix E: "THE LOAN AGREEMENT." Proceeds of the Loan will be applied to the refunding of the Series 2004 Bonds pursuant to an Escrow Agreement between the Company and the Trustee (the "Escrow Agreement"). Pursuant to a Tax Regulatory Agreement among the Company, the School, the Issuer and the Trustee (the "Tax Regulatory Agreement"), the Company and the School will make certain representations and covenants related to maintaining the exclusion from gross income for federal income tax purposes of interest on the Series 2013A Bonds. Pursuant to the Indenture, the Issuer will pledge to the Trustee, for the benefit of the holders of the Bonds, all of its interest in the Loan Agreement (other than certain indemnification and expense reimbursement payments) to secure payment of the principal of, premium, if any, and interest on the Bonds. Pursuant to an Amended and Restated Mortgage, Security Agreement and Assignment of Leases and Rents (the "Mortgage"), to be executed by the Company in favor of the Trustee, the payment of the principal of, premium, if any, and interest on the Bonds will be secured by a mortgage lien on and security interest in the Project, subject to certain "Permitted Encumbrances" described in the Mortgage. See Appendix E: "THE MORTGAGE." Lease Pursuant to a Lease Agreement dated as of 1, 2013 (the "Lease") between the Company and the School, the Company shall lease the Project to the School. The School shall use the Project for the charitable purpose of operating a public (charter) school in accordance with Minnesota Statutes, Section 124D.10. The term of the Lease shall be at least equal to the term of the Series 2013 Bonds. Payments due under the Lease shall be withdrawn by the Trustee from the Sweep Account (defined herein) for deposit in the Revenue Fund, and shall, in the aggregate, be equal to the amount necessary for the Company to pay semi-annual debt service on the Series 2013 Bonds and certain other fees and costs in connection with the Bonds. Lease payments shall be paid primarily from Building Lease Aid received by the School from the State pursuant to Minnesota Statutes, Section 124D.11, subd. 4. See Appendix E: "THE LEASE." Pledge and Covenant Agreement As additional security on the Series 2013 Bonds, the School shall pledge certain of its revenues to the Trustee for payments on the Series 2013 Bonds as necessary, pursuant to a Pledge and Covenant Agreement dated as of 1, 2013 (the "Pledge Agreement") from the School. The Pledge Agreement also provides that in the event Building Lease Aid is insufficient to make lease payments under the Lease, general education funding from the State, and other special State and federal pass -through education funding sources shall be applied to the payment of such insufficiency. Sae Appendix E: "THE INDENTURE" and "THE PLEDGE AGREEMENT." Under the Pledge Agreement, the revenues received by the School from the State shall be deposited into a Sweep Account, from which the Trustee shall withdraw the payments due from the School under the Lease. 34