HERITAGE ACADEMY SUMMARY LETTER.PDF

A PROFESSIONAL CORPORATION
One North Central Avenue, Suite 1200
Phoenix, Arizona 85004-4417
P 602.440.4800 F 602.257.9582
Offices in Arizona & Colorado
www,rcMave.com
John J. Fries
Direct Line: 602-440-4819
Direct Fax: 602-257-6919
E-mail: ifriesrcalaw.com
January 3, 2019
To: Board of Supervisors Board of Directors of
Maricopa County, Arizona The Industrial Development Authority
of the County of Maricopa
Re: Not to Exceed $20,000,000 — The Industrial Development Authority of the
County of Maricopa Charter School Revenue Bonds (Heritage Academy —
Maricopa Campus), Series 2019
Ladies and Gentlemen:
At the Authority Board meeting on January 8, 2019, the Authority Board will be
asked to grant final approval to the financing for the Heritage Academy — Maricopa Campus and
to adopt a resolution authorizing the issuance and sale of the bonds as described above (the
"Bonds"). The purpose of this letter is to provide a summary review of the proposed financing.
THE AUTHORITY
The Authority is an Arizona nonprofit corporation, formed with the permission of
Maricopa County and incorporated under and pursuant to the Arizona Industrial Development
Financing Act, Title 35, Chapter 5, Arizona Revised Statutes, as amended (the "Act"), and the
Authority is designated by law to be a political subdivision of the State of Arizona.
THE APPLICANT/BORROWER
The Applicant/Borrower for financing is Heritage Academy, Inc., an Arizona
nonprofit corporation designated as a 501(c)(3) organization under the Internal Revenue Code of
1986, as amended (the "Code").
THE PROJECT
The proceeds of the not to exceed $20,000,000 of Bonds will be used (a) to
finance the costs of acquiring, constructing, improving, renovating and equipping as applicable,
the land and building located near the northeast corner of Porter and Bowlin Roads, at the end of
Adams and Lucera Lanes, Maricopa, Arizona, to be owned by Heritage Academy, Inc. (the
"Maricopa Campus"); (b) to fund any required reserve funds; (c) to pay capitalized interest on a
portion of the Bonds; and (d) to pay eligible costs related to the issuance of the Bonds.
4507645.1
01/02/19

Board of Supervisors
Maricopa County, Arizona /ea& Hui/5
Board of Directors
of The Industrial Development Authority
of the County of Maricopa
January 3, 2019
Page 2
NOTIFICATION TO ARIZONA ATTORNEY GENERAL
As required by the provisions of Arizona Revised Statutes, Section 35-721.F, the
Authority will notify the Arizona Attorney General of the Authority's intention to issue the
Bonds.
PUBLIC HEARING
A public hearing pursuant to Section 147(f) of the Internal Revenue Code of
1986, as amended, will be held prior to the meeting of the Maricopa County Board of
Supervisors, and a Report of Public Hearing will be delivered to the Maricopa County Board of
Supervisors.
ALLOCATION FOR TAX EXEMPT FINANCING
No allocation of the Arizona volume cap' is required for the issuance of the
Bonds as the Applicant/Borrower is a nonprofit corporation designated as a 501(c)(3)
organization under the Code.
FINANCING PARTICIPANTS
The major participants in the financing are as follows:
Issuer: The Industrial Development Authority of the County of
Maricopa
Issuer Counsel: Ryley Carlock & Applewhite, a professional corporation
Applicant/Borrower: Heritage Academy, Inc.
Applicant/Borrower Counsel: Engelman Berger, PC
Bond Trustee: UMB Bank, National Association
Bond Underwriter: D.A. Davidson (S'L Co.
Bond Counsel: Gilmore & Bell, P.C.
Underwriter/Disclosure Counsel: Ballard Spahr, LTA)

Board of Supervisors
Maricopa County, Arizona Aorricyo
Board of Directors
of The Industrial Development Authority
of the County of Maricopa
January 3, 2019
Page 3
PRINCIPAL FINANCING DOCUMENTS
Document Parties
Bond Indenture (the "Indenture") Issuer and Trustee
Loan Agreement (the "Loan Agreement") Issuer and Borrower
Deed of Trust, Security Agreement, Assignment of Borrower
Rents and Leases and Fixture Filing (the "Deed of
Trust")
Limited Offering Memorandum Borrower and Bond Underwriter
Tax Certificate and Agreement Issuer and Borrower
Various assignment of contract instruments Borrower
Bond Purchase Agreement Borrower, Issuer and Bond
Underwriter
PLAN OF FINANCING
The Bonds will be issued in one or more tax exempt and taxable series in an
aggregate principal amount of not to exceed $20,000,000.
The Bonds will be issued under and pursuant to the terms and provisions of the
Indenture. The proceeds from the sale of the Bonds will be loaned by the Authority to the
Borrower pursuant to the terms of the Loan Agreement. The Borrower will be obligated to make
loan repayments in amounts and at such times as required to pay principal and interest on the
Bonds on their respective due dates.
The obligations of the Borrower to make periodic loan repayments as well as to
perform the other obligations of the Borrower as set forth in the Loan Agreement will be secured
by Deed of Trust as a first lien on the Maricopa Campus.
The Bonds will be underwritten by the Bond Underwriter (D.A. Davidson & Co.).
The Bonds, in their entirety, will be purchased by Hamlin Capital Management, LLC ("Hamlin")
for the accounts of persons for which Hamlin serves as a financial advisor. Hamlin will provide
the Bond Trustee, the Underwriter and the Authority with an agreed-upon form of Certificate

Board of Supervisors
Maricopa County, Arizona ,"400.JS
Board of Directors
of The Industrial Development Authority
of the County of Maricopa
January 3, 2019
Page 4
certifying that each account holder that will hold Bonds is either a "qualified institutional buyer,"
or "accredited investor" within the meaning of applicable security laws.
Finally, the Tax Certificate and Agreement will be executed by the Issuer and
Borrower to evidence various agreements aimed at establishing and preserving the tax exempt
status of the Bonds.
FINAL APPROVAL
At the Authority Board meeting on January 8, 2019, the Authority Board will be
asked by the Applicant/Borrower to grant final approval to the application for financing and to
adopt a resolution authorizing the issuance and sale of the Bonds.
BOARD OF SUPERVISORS APPROVAL
If the Authority Board acts to grant final approval for the financing and to adopt a
resolution authorizing the issuance and sale of the Bonds, the Maricopa County Board of
Supervisors will be requested to adopt a resolution approving the proceedings of the Authority
for the issuance of the Bonds.
Under the provisions of the Act, specifically A.R.S. § 35-721.B., the proceedings
under which the Bonds of the Authority are to be issued require the approval of the Maricopa
County Board of Supervisors.
Under the provisions of the Act, specifically A.R.S. § 35-742, Maricopa County is
not in any event liable for the payment of principal or interest on bonds issued by the Authority
or for the performance by the Authority of any pledge, mortgage, obligation or agreement of any
kind undertaken by the Authority and bonds of the Authority or any of its agreements or
obligations shall not be construed to constitute an indebtedness of Maricopa County within the
meaning of any constitution or statutory provision.
TRANSACTION CLOSING
If the required approvals of the Authority Board and the Maricopa County Board
of Supervisors are received, it is currently anticipated that the Bonds will be issued in late
January, 2019. At the time the Bonds are issued, it is anticipated the designated Bond Counsel,
Gilmore & Bell, P.C. will deliver its written opinion to the effect the Bonds have been validly
issued and that as to the portion of the Bonds designated as being tax-exempt, the interest on the
Bonds is exempt from federal and Arizona income taxation and that as to the portion of the

Board of Supervisors
Maricopa County, Arizona il‘torn,ys
Board of Directors
of The Industrial Development Authority
of the County of Maricopa
January 3, 2019
Page 5
Bonds which are not designated as tax-exempt, the interest on such Bonds will be exempt from
Arizona income taxation.
LEGAL COUNSEL RECOMMENDATION
As counsel to the Authority, we have reviewed drafts of the principal financing
documents, we have been advised that these documents are now in substantially final form, and
based upon our review of such and our review of the proceedings to date relating to the proposed
issuance of the Bonds, we believe the financing documents and proceedings are in substantial
conformance with the policies and guidelines of the Authority and are in both form and
substance acceptable for the Authority Board and Maricopa County Board of Supervisors to act
upon and that the Resolution presented to the Authority Board relating to authorizing the
issuance and sale of the Bonds, and related matters, and the Resolution of the Maricopa County
Board of Supervisors will be asked to adopt are in form and substance acceptable for the
adoption.