Educational Resource Center Inc

“The Board of Directors annually reviews the 990 tax return at a board meeting. In addition, the Board certifies the audited financial statements that are used in the preparation of the 990 tax return.”

“The Organization follows the necessary Texas Education Agency requirements of independence. All transactions are monitored for possible conflicts of interest. THe organization enforces policies that are in compliance with the requirements of the Texas Education Agency.”

“The BOARD OF DIRECTORS of the organization reviews and surveys comparable data in determining compensation. The Board of Directors approve the compensation of the organization's Executive Director.”

“The organization makes its governing documents and financial statements available upon request.”

“BRAINATION, INC. AND ITS AFFILIATES' OBLIGATIONS UNDER BONDS PAYABLE CONSIST OF EDUCATION REVENUE BONDS (SERIES 2013A) ISSUED THROUGH DANBURY HIGHER EDUCATION AUTHORITY, INC. AND DATED JUNE 1, 2013. ALL BONDS WERE CLOSED AND FUNDED ON JULY 2, 2013, WITH PROCEEDS BEING HELD BY THE U.S. BANK NATIONAL ASSOCIATION. THE BONDS' PROCEEDS WILL BE USED FOR PROPERTY ACQUISITION AND CONSTRUCTION AT THE ANNE FRANK INSPIRE ACADEMY CAMPUS AND WERE UNDERWRITTEN BY OPPENHEIMER & CO., INC. THE INTEREST RATES ON THE BONDS RANGE FROM 5.25% TO 6.50%, AND THE TERMS OF THE BONDS RANGE FROM TEN TO THIRTY YEARS. AS OF AUGUST 31, 2017, BONDS PAYABLE WAS $9,375,000, CONSISTING OF BONDS PAYABLE - CURRENT OF $160,000 AND BONDS PAYABLE - LONG-TERM OF $8,988,060 (NET OF A DISCOUNT OF $263,543 AND RELATED ACCUMULATED AMORTIZATION OF $36,603). AS OF AUGUST 31, 2016, BONDS PAYABLE WAS $9,530,000, CONSISTING OF BONDS PAYABLE - CURRENT OF $155,000 AND BONDS PAYABLE - LONG-TERM OF $9,139,275 (NET OF A DISCOUNT OF $263,543 AND RELATED ACCUMULATED AMORTIZATION OF $27,818). THE ORIGINAL AMOUNT OF THE DISCOUNT AT DATE OF ISSUANCE WAS $263,543, OF WHICH APPROXIMATELY $64,642 WAS PAID AT DATE OF ISSUANCE. AMORTIZATION EXPENSE RELATED TO THIS DISCOUNT FOR THE YEARS ENDED AUGUST 31, 2017 AND 2016 WAS $8,785. ISSUANCE COSTS PAID FOR THESE BONDS AT DATE OF ISSUANCE TOTALED $411,939. AMORTIZATION EXPENSE RELATED TO THESE COSTS FOR THE YEARS ENDED AUGUST 31, 2017 AND 2016 WAS $13,730 AND $13,731, RESPECTIVELY. Section 5.9 of the Series 2013A bond covenants establishes a debt service coverage ratio, which stipulates that available revenues (i.e., the amount of excess (deficit) of adjusted revenues over expenses) for each fiscal year must be equal to at least 1.10 times the annual debt service requirements of Braination, Inc. as of the end of the first fiscal year after the date of issuance of the bonds and annually thereafter until the bonds have been paid in full. Expenses include all operating and non-operating expenses or losses incurred during the fiscal year other than (a) interest expense, (b) depreciation and amortization, (c) extraordinary losses and (d) capital expenditures. As of August 31, 2016, Braination, Inc. was not in compliance with the liquidity requirement in the covenant. The noncompliance was not considered to be a material event, and Braination, Inc. performed the necessary corrective action to address the noncompliance. As of August 31, 2017, Braination, Inc. was in compliance with this covenant and all applicable covenants contained in the loan agreement. Interest expense on bonds payable was $598,998 and $547,570 for the years ended August 31, 2017 and 2016, respectively. Capitalized interest was $-0- and $61,084 for the years ended August 31, 2017 and 2016, respectively.”

“The organization's process for assuming responsibility for oversight of the audit, review, or compilation of its financial statements and the selection of an independent auditor have not changed from the prior year.”

“Braination inc 10325 bandera road san antonio, tx 78250 employer identification number: 74-2869255 for the year ending august 31, 2017 braination inc is making the de minimis safe harbor election under reg. Sec. 1.263(a)-1(f).”