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gae 6 rExpansion i f in Florida �. understanding with AAF to act as a conduit for the $1.75 billion PAB allocation. The Board's vote, however, was later revealed to be invalid due in large part to the fact that the voting Board members' terms had expired. In the Spring of 2015, attempts were made to establish a properly constituted Board, but there continued to be flaws in the constitution of the FDFC's Board of Directors, including lack of Senate confirmation, a lack of the statutorily required appointment of at least three bankers and potential conflicts of interest. How Will These Tax Exermt Bond Dollars Be Used? Based on the documents that were part of the FDFC's meeting packet, AAF will use the $600 million to retire its current high price debt, replacing it with lower price debt. Specifically, documents indicate that AAF intends to use almost all of the money from the new tax exempt bonds to pay off the only prior funds it had raised from the market—originally $405 million at 12% but now ballooning above $500 million with interest owed. In addition, documents indicate AAF intends to payoff $98 million of the Siemen's manufacturer financing of the five trains sets it purchased. The $98 million is only a portion of the cost of the five train sets, and leaves AAF with a debt of approximately $160 million. The trains were financed by Siemens to accommodate the AAF buyer. In a nutshell, nearly 100 percent of the new $600 million in financing would go to refinance debt already incurred in Phase 1. All AAF has accomplished is to get the right to issue tax exempt bonds to replace expiring or expensive existing debt that was either coming due (the trainsets) or was very expensive (the "toggle" bonds). Further, a recent article in Bond Buyer reveals the bonds will not be "rated" (because they are unrateable) and that they are "junk bonds". Updated Ridershiv and Revenue Studv The OPPAGA Research Memorandum dated November 13,-2017 stated: "FDFC staff is responsible for analyzing information provided by the borrower... FDFC also ensures that the borrower has provided documents to demonstrate that the proposed project is financially feasible and has the ability to repay investors." (Page 4) FDFC's most recent meeting materials included a new Ridership and Revenue Study prepared by Louis Berger US, Inc. ("Louis Berger") for Phase I of the project. This 2017 study (titled "Brightline Ridership and Revenue Study: Miami – Fort Lauderdale – Palm Beach Segment" dated October- 2017) sets forth the projections as to ridership and revenue that underpin the pro forma financials for the bond issue that FDFC approved. As explained below, this 2017 study is remarkably more optimistic about the prospects for the new train line than the 2013 study that Louis Berger prepared for the senior secured PIK toggle notes that AAF marketed in 2014. (The 4 145-8