Laserfiche WebLink
From: Sally Tasker <SIly.Tasker(abutlersnow.com> <br />Sent: Friday, August 29, 2014 9:37 AM <br />To: Aaron De,bng <br />Cc: 'Sam Light' (slight@ightkelly.com); Dee VVisor <br />Sbject:RE Smple interest <br />Good morning Aaron. <br />VVe looked at the Takoda Metro District Bonds official statement, and the <br />interest did compound so the developer is used to the compounding. I think our structure is a <br />little unusual. In the typical governmental bond issue, we have an amortization schedule for the <br />principal and scheduled amounts of interest that are generally due semiannually. The interest <br />that accrues on the bonds is simple interest, but the failure to pay interest on the due date is <br />also an event of default. In these cases, if the interest payment is not made when due, the interest <br />remains outstanding, but it does not compound. In our transaction, we have an interest rate and <br />an interest payment date, but the failure to pay is not an event of default. V1b also do not have <br />regularly scheduled principal payments. Payments are made to the extent that there are available <br />Pledged Fbvenues. We have en bonds that were structured like this that have compound <br />interest and we have seen simple interest. I think the bottom line is that this isa business <br />decision between the LRCand the developer /purchaser of the bonds. We also have to make sure <br />that the feasibility study still shows that the Bonds together will all accrued interest will be paid <br />in full by their maturity date if we structure thiswith compound interest. <br />Thank you. <br />-Sally <br />Farah P. Tasker <br />Butler Slow LLP <br />Direct: (720) 330 -2352 <br />Fax: (720) 330 -2301 <br />Sally.Tasker@butlersnow.com <br />1801 California Sreet, Site 5100 <br />Denver, 0080202 <br />