Current Activities

The ongoing activities of TSASC, Inc. (“TSASC”) consist of carrying out the requirements of its indenture, including collecting tobacco settlement revenues (“TSRs”), applying pledged and, as needed, unpledged TSRs to pay principal and interest on its bonds, remitting to the City of New York any remaining unpledged TSRs and complying with federal tax law in order to maintain the tax exemption of its bonds. In addition, TSASC complies with annual continuing disclosure requirements, issues annual audited financial statements, and complies with state and local reporting requirements.

During Fiscal Year 2017, TSASC refinanced and restructured all of its outstanding debt under a new indenture which provides for senior and subordinate liens. The senior lien has regularly scheduled amortization beginning in Fiscal Year 2017 and a portion of the subordinate lien debt has regularly scheduled amortization beginning in Fiscal Year 2018. The majority of the subordinate lien debt has a flexible amortization schedule, similar to the prior bond structure. No additional TSASC debt has been issued since Fiscal Year 2017.

On December 9, 2024, TSASC entered into a Security Agreement with the Indenture Trustee (the “Security Agreement”), pursuant to which TSASC pledged to the Indenture Trustee unpledged TSRs. The Security Agreement stipulates that unpledged TSRs are to be used, to the extent needed, to cure shortfalls on debt service payments for TSASC’s outstanding bonds if pledged TSRs and liquidity reserves are insufficient to make these payments, beginning with the June 1, 2025, payment and through, at the latest, the June 1, 2028, payment.

As of June 30, 2025, TSASC has approximately $879 million of bonds outstanding.