San Luis Obispo County Treasury Investment Pool's primary investment objectives are the safety and preservation of capital and liquidity sufficient to meet scheduled cash flow
In addition, scheduled monthly cash flow from one pool may be diverted to cover deficiencies in scheduled cash flow
on the other pool in limited circumstances.
The earnings are expected to represent 18% of scheduled cash flow
in addition to 30% contract assistance from the commonwealth (G.
There is no requirement that scheduled cash flows
from investments be sufficient to repay the notes, and the issuer has the right to use the investment proceeds to finance the payment of taxes, operating and organizational costs.
These factors have increased the possibility that scheduled cash flows
under the permitted investments could be diverted from the EEN noteholders.