Agenda - Council - 07/12/2022 - Laserfiche WebLink

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Various Operating Covenants of the Charter School The Loan Agreement and the Pledge Agreement also contain other financial requirements and covenants that the Charter School must comply with in the future. See "APPENDIX F —DEFINITIONS OF CERTAIN TERMS AND SUMMARIES OF DOCUMENTS — THE LOAN AGREEMENT" and "—THE PLEDGE AGREEMENT" in this Official Statement. Operating Reserve Balance and Days Cash on Hand Covenant.Pursuant to the terms of the Pledge Agreement,the Charter School covenants and agrees to maintain unrestricted Cash on Hand in its Operating Fund such that on each testing date (each June 30, commencing June 30, 20[22])the amount on deposit in such fund shall be equal to or greater than 30 Days Cash on Hand for the Fiscal Year ended June 30,20[22], and at the end of each Fiscal Year thereafter. The Charter School's Cash on Hand shall be tested annually at the end of each Fiscal Year, commencing June 30, 20[22]. The Charter School will cause its auditor to include a calculation of its Days Cash on Hand in its audited financial statements each Fiscal Year. The Charter School will provide the Trustee and the Majority Bondholder with a certification no later than December 31 of each year in the format of Exhibit B attached to the Continuing Disclosure Agreement that the Days Cash on Hand requirement has been met. The Indenture defines"Cash on Hand"as the sum of cash,cash equivalents,liquid investments and unrestricted marketable securities(valued at the lower of cost or market value) of the Charter School. Cash on Hand specifically does not include amounts held by the Trustee or the proceeds of any Indebtedness. Debt Service Coverage Ratio Covenants. In addition to the days cash on hand covenant discussed above, commencing with the Fiscal Year ending June 30, 20[23] and each Fiscal Year thereafter, as measured on the last day of each Fiscal year, the Charter School will also comply with either of the following covenants: (i) maintain Net Income Available for Debt Service in each Fiscal Year that will be at least 100% of the Principal and Interest Requirements on Long-Term Indebtedness during such Fiscal Year if the unrestricted Cash on Hand in its operating fund is at least 90 Days Cash on Hand;or(b) maintain Net Income Available for Debt Service in each Fiscal Year that will be at least 110% of the Principal and Interest Requirements on Long-Term Indebtedness during such Fiscal Year if the unrestricted Cash on Hand in its operation fund is less than 90 Days Cash on Hand, The Charter School will budget and set expenses and will operate its School Facility, subject to applicable requirements or restrictions imposed by law, to satisfy all obligations under the Lease and the Pledge Agreement. If the Cash on Hand at the end of any Fiscal Year is below the required amount, then, upon the written direction of a Majority Bondholder, the Charter School will promptly select an Independent Consultant acceptable to the Majority Bondholder in accordance with the provisions of the Pledge Agreement, to review and analyze the operations and administration of the Charter School, including the marketing programs of the Charter School, inspect the School Facility, and submit to the Charter School, the Trustee and the Majority Bondholder written reports, and make such recommendations as to the operation and administration of the Charter School as such Independent Consultant deems appropriate, including any recommendation as to a revision of the methods of operation thereof. The Charter School agrees to follow the recommendations of the Independent Consultant and, to the fullest extent allowed by law and its Charter Contract,to adopt and carry out such recommendations. So long as the Charter School is otherwise in full compliance with its obligations under the Pledge Agreement, including following, to the fullest extent allowed by law, the recommendations of the Independent Consultant, it shall not constitute an Event of Default if the Cash on Hand at the end of any Fiscal Year is less than the required amount of Cash on Hand. If requested,the Charter School shall provide the Trustee with a written certification that the Charter School is, to the fullest extent allowed by law, in 20