From a Facebook conversation with Steven Poole

Steven Poole; "Have a CPA type question regarding the Civil Rights museum audit.

First I'll quote the relevant passage then ask my question.

"The Museum Landlord, LLC has the following Outstanding Loans: (1) SCD Loan -- The Project has a loan with Stonehenge Community Development XII in the original amount of $18,971,651. Interest accrues daily on the unpaid balance, at the fixed rate of 1% per annum. Accrued interest only payments are due quarterly through March 2019. Commencing April 1, 2019 and continuing until August 17, 2044 (maturity date), principal payments equal to 97% of Operating Cash Flow, as defined by the Landlord Agreement, for the preceding quarter, plus accrued interest are due. All principal and any unpaid interest shall be due and payable at maturity. THE LOAN IS GUARANTEED BY THE DEVELOPER (SIM, short for Sit-In Movement)."

Steven Poole; Does this mean if the for-profit "Museum Landlord, LLC" -- which is owned by the for-profit International Civil Rights Center and Museum, or ICRCM -- defaults on the loan that debt then falls on the non-profit Sit-In Movement because is has guaranteed the loan?
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George Hartzman; They have something guaranteed by a BB&T line of credit as well. Ask the city. Len Lucas did the audit. He knows his stuff, but still has to work there. So ask the detail in an FOIA.

"Commencing April 1, 2019 and continuing until August 17, 2044 (maturity date), principal payments equal to 97% of Operating Cash Flow, as defined by the Landlord Agreement, for the preceding quarter, plus accrued interest are due."

George Hartzman; Ask for the landlord agreement.

97% of operating cash flow plus interest? Looks like someone got sold a bridge.

They agreed to give 97% of any profits plus interest for 25 years?

What happened to the $30 million?

Did they really spend $30 million on the building?

I would think a covenant like that would go to someone getting paid from the upfront money.

I am not a CPA btw, but I could play one on tv.

For the record, Len Lucas has been to one of my CPA education classes.