Transactions and Case Studies: $4,685,000 Special Purpose Revenue Bonds, Series 2014A

Port of Morrow
Morrow County Oregon
(Kodiak Carbonic, LLC Project)

The Project involves the installation of plant equipment (“Plant Equipment”) currently owned by the Kodiak Carbonic, LLC (the “Borrower”) and the construction of infrastructure surrounding the same (collectively, the “Plant”). The Plant Equipment is designed to capture emissions of a nearby ethanol production facility owned by Pacific Ethanol Columbia, LLC (“Pacific Ethanol”) (the “Ethanol Facility”), and process the same into liquid carbon dioxide for resale. The Project will be located adjacent to the Ethanol Facility on real property owned by the Port in Boardman, Oregon (the “Property”), via a sublease from Pacific Ethanol. The intent is to sell substantially all of the product processed by the Project to a single purchaser, Air Liquide Industrial U.S. LP (“Air Liquide”), pursuant to a “take or pay” contract that is subject to extension by Air Liquide prior to the maturity of the Bonds.

MCM privately placed the non-rated $4,685,000 floating rate, tax-exempt, industrial revenue bonds with a 10 year amortization and a balloon payment due on Aug. 15, 2020 and arranged for a fixed interest rate swap at 3.58% with a commercial bank. Security for the bonds includes a lien on the leasehold estate, including the Project, the ground sublease, the Pacific Ethanol Contract, the Air Liquide contract, all Project Revenues, the funds and accounts established under the indenture.