September 2, 2023 – In the fall of 2022, the Calhoun School, a premier co-educational independent school on New York City’s upper west side agreed to acquire the Metropolitan Montessori School in a merger. Among the many synergies that the merger partners expected to enjoy were those relating to the schools’ respective physical facilities.
Both schools had previously received financing from commercial banks under a New York City program provided by Build NYC Resource Corporation which had issued its bonds in support of the financing. The program, which is available to 501(c)3 and other tax-exempt entities, provides a tax exemption for the interest the banks receive on the bonds – a savings that had been passed on to the schools in the form of beneficial interest rates.
Ensuring that the bond regimes survived the merger was of paramount importance to the schools’ financial plan. They turned to DHC for guidance in dealing with Build NYC Resource Corporation and the banks.
DHC was successful in ensuring that the banks and NYC EDC approved the plan of merger under which one building would be sold to a third party in order to reduce debt and finance the combined schools’ operations.
On June 30, 2023, Jeffrey Citron, William Walzer, and Nicholas Terzulli, quarterbacked a closing in which the merger was concluded, one of the schools’ buildings was sold, mortgages were spread and amended, debt to the banks was reduced, and the favorable financing terms were preserved.
The DHC team worked round the clock to ensure that all went off without a hitch and shepherded the deal to completion on time, on target and on budget.