Nashua Performing Asts Center -- NMTC Term Sheet
October 14, 2020
Confidential
Reserves:
Subject to the terms of the final financial projections, a cash reserve may be
required at the Investment Fund level.
Distributions:
During the NMTC Compliance Period, cash received by Investment Fund from
Sub-CDE will be distributed and used as follows: (1) payment of permitted
administrative and operating expenses, including the annual management fee,
and (2) payment of interest on the Fund Loan.
Put/Call Agreement
At the end of the seven-year NMTC Compliance Period, Investor shall have the
right to put all of its membership interest in Investment Fund to an affiliate of
Borrower, Sponsor or Fund Lender (“Option Purchaser”) for $1,000. In the
event that Investor fails to exercise its put option, Option Purchaser will have an
option to purchase Investor’s membership interest in Investment Fund at fair
market value as determined by an appraisal made by a qualified appraiser
determined by the Option Purchaser.
Other Terms:
Fund Lender wifl not be entitled to collect, receive, or make any claim against
or with respect to any indemnity payments made to Investment Fund pursuant to
the provisions of Sub-CDE's operating agreement or any indemnification
agreement (collectively, “Indemnity Payments”) to satisfy any indebtedness or
other sums due, or that may become due, under or in connection with the Fund
Loan or the Fund Loan Documents, and (b) any and all such Indemnity
Payments, whenever made, shall be permitted to be distributed by Investment
Fund to its member as compensation for the loss or recapture of New Markets
Tax Credits for which such Indemnity Payments shall have been made. Fund
Lender will acknowledge and agree that it has not bargained for, and does not
intend to have, the right to collect or receive any Indemnity Payments, and Fund
Lender will expressly waive and release any and all rights to prohibit, set aside,
revoke, or seek the return of any such Indemnity Payments made to Investment
Fund and distributed to its member, whether pursuant to the Fund Loan
Documents or any bankruptcy, fraudulent transfer, insolvency, or other federal
or state laws providing any such rights.
SUB-CDE STRUCTURE
Sub-CDE
Ownership
Structure:
Sub-CDE will be a single-purpose limited liability company. Investment Fund
will own a 99.99% interest (the “Jnvestor Member”) and Allocatee will own a
0.01% interest and serve as the managing member (the “Managing Member"),
The Sub-CDE may elect to either be taxed as a partnership for federal income tax
Purposes of as a corporation for federal income tax purposes.
Sub-CDE
Management:
The Managing Member shall arrange for the management of operations,
compliance, loan disbursement and servicing, and asset management for Sub-
CDE.
Sab-CDE
Capitalization:
Sub-CDE shall receive a total of $9,750,975 from Investment Fund and Managing
Member. It is anticipated that $9,555,000 of these funds will be used to make the
QLICI Loans to Borrower as outlined below (assuming a fourth quarter 2020
closing):
33231393
