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This is a function of interest rate and the finance period. For <br />example, if you fund $13 over 20 or 15 or 10 years, it will fund <br />different amounts - just like your home mortgage. If you take a <br />15 year mortgage versus a 30 year mortgage, it ups your payments <br />but cuts your time and your total interest. However, it appears <br />on the advice of Art Diamond that possibly in terms of the <br />market, $13 for 20 years would not be the most acceptable. Again <br />there is another question as to what the interest rate will do. <br />The structure of the agreement is contingent upon our getting <br />acceptable financing. In the language within the documents we <br />are preparing now for the bond issue necessary to fund this, the <br />staff has recommended that language be included that the charge <br />be $13 a month as a surcharge; however, the option is to raise <br />that charge contingent upon the necessity to fund an additional <br />amount. Chairman Scurlock noted there are other options we are <br />looking at - we can go to the pool, which we have not ruled out, <br />or go to a variable interest rate. What that would result in <br />would be a low interest rate at the front end and possibly higher <br />at the end. <br />Chairman Scurlock advised that there is another thing they <br />are looking at. After the Gifford project gets closed out and <br />the Farmers Home loan is actually issued (it is just a commitment <br />at this time), we are talking about a major refunding of all of <br />our issues, consolidating our debt, and getting rid of some of <br />the bond covenants, which are somewhat restrictive at this point. <br />We can't do that at this time since the loan has not actually <br />been granted, but once it is issued, they feel a discount similar <br />.to the one offered earlier will be offered, and at that time, he <br />felt there will be a serious look at recommending a refinancing <br />and rolling this issue up into that overall general issue. The <br />other option available, as shown through our cash flow analysis, <br />which will be coming to the Board fairly soon from Coopers <br />Lybrand, is that we are going to be looking at a potential for a <br />JUL 1988 62 BooK 7e F.9rE3®� <br />