SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2024 NOTE E – LONG-TERM LIABILITIES - CONTINUED The annual requirements to amortize the general obligation bonds as of June 30, 2024, including interest payments, are as follows: Year ending June 30, Principal Interest Total 2025 $ 6,110,000 $ 1,277,339 $ 7,387,339 2026 6,565,000 1,050,939 7,615,939 2027 6,947,000 803,389 7,750,389 2028 7,345,000 472,900 7,817,900 2029 7,785,000 221,400 8,006,400 $ 34,752,000 $ 3,825,967 $ 38,577,967 Legal Debt Margin Article VI, Section 26(b) of the Constitution of Missouri limits the amount of General Obligation Bonds which can be authorized and outstanding by a school district to 15% of the assessed valuation of taxable tangible property within the District. The legal debt margin of the District at June 30, 2024 was: Constitutional debt limit $ 225,456,089 General obligation bonds payable (34,752,000) Amount available in Debt Service Fund 5,455,779 Legal debt margin $ 196,159,868 - 43 - SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2024 NOTE E – LONG-TERM LIABILITIES - CONTINUED Lease On June 1, 2019, the District entered into a $5,065,000 lease agreement. The proceeds of the lease were used as follows:  $550,867 of capital improvements to Meramec Elementary with $96,401 of related accumulated amortization  $4,514,133 of capital contributions to the joint venture, Clayton Recreation, Sports and Wellness Commission. See Note K for more information on the joint venture. Since this represents a capital contribution, there is not an asset or related accumulated depreciation. The District is only obligated to pay such payments under the lease as may lawfully be made from funds budgeted and appropriated for that purpose. Should the District fail to budget, appropriate or otherwise make available funds sufficient to pay the payments, the lease would be deemed terminated at the end of the current term and the collateral would transfer to the possession of the lessor. Meramec Elementary School is pledged as collateral. The District has the option to purchase the lessor's interest in the project through prepayment. If the prepayment is paid with internally generated funds (i.e. not in connection with refinancing or grant), there would be no prepayment premium. Otherwise, the prepayment premium would be 3% of the remaining principal portion if on or before the first anniversary of the commencement date; 2% of the remaining principal portion if after the first anniversary but on or before the second anniversary of the commencement date; 1% of the remaining principal portion if after the second anniversary of the commencement date. - 44 -