Nashua Performing Arts Center -- NMTC Term Sheet Confidential
October 14, 2020
leverage loan (the “Fund Loan”) from Fund Lender in the amount necessary to
permit the funding of the $9,750,000 QEI into Sub-CDE together with payment
of any fees by Investment Fund and establishment of any reserves identified in
the financial projections. Investor equity and the Fund Loan will both fully
fund on the transaction closing date.
Sub-CDE will use the $9,750,000 QEI it receives from Investment Fund to
make one or more loans to Borrower in the aggregate principal amount of
$9,555,000 and pay a sub-allocation fee to MCD in the amount of $195,000.
INVESTMENT FUND STRUCTURE
Investment Fand
Structure:
Investment Fund will be a single purpose limited liability company 100%
owned by Investor and managed by Fund Manager.
Investment Fund
Management:
Fund Manager will manage the day-to-day operations of Investment Fund,
including (but not limited to) receiving cash distributions from Sub-CDE and
payment of the obligations due to Fund Lender,
Investment Fund
Capitalization:
Investment Fund will receive equity and debt totaling approximately $9,998,750
fram the following sources:
Investor will contribute $2,889,900 in cash in exchange for a 100% LLC
membership interest (the “Fund Equity”) in Investment Fund. The amount of
the Fund Equity is computed based on a $9,750,000 NMTC allocation, tax
credits of 39% on the NMTC allocation, at a price of $0.76 per credit dollar.?
Fund Lender will make the Fund Loan to Investment Fund in an amount, that
when combined with the Fund Equity, is sufficient to fully fund the QEI, to pay
any Investment Fund fees, and to establish any reserves contemplated in the
final financial projections, which Fund Loan amount is anticipated to be
approximately $7,108,850.
Fund Equity:
The Fund Equity will be paid in at closing.
Return on Equity: Investor’s equity return is based on delivery of (1) 100% of
all NMTCs (expected to total $3,802,500); and (2) pass-through of 100% of
other tax benefits and costs derived from Investment Fund.
Fund Loan:
Pay-in Schedule: Funded in full at QLICI closing.
Fund Loan Term: At least 7 years, but currently expected to be at least thirty
(36) years.
Interest Rate: The interest rate shall be fixed for the entire term of the Fund
Loan, with a to-be-determined interest rate, subject to the commitment letter of
Fund Lender, ifany.
Amortization: Interest-only for the first seven years. Thereafter, the Fund Loan
will be amortized as determined by Fund Lender.
? The amounts in this paragraph are premised on the transaction closing during the fourth calendar quarter of 2020.
33231393
3
